Citizens insurance better prepared in case of hurricane after closing $900 million deal
Jul 15, 2011
The following article was published in the Fort Myers News-Press on July 15, 2011:
Citizens Insurance better prepared in case of hurricane after closing $900 million deal
Citizens Property Insurance Corp. said Friday it closed on $900 million in pre-event bond financing to help with the costs of providing coverage to coastal customers. It is used to provide liquid funds to pay policyholders in a timely manner if a hurricane hits.
Citizens now has more than $16 billion in claims paying ability for the 2011 hurricane season.
James R. Malone, Chairman of the Citizens Board of Governors said, “This financing demonstrates Citizens’ continuing commitment to our policyholders, but it does not represent a financial burden on other citizens of the state. The issuance of these bonds does not require an assessment of any type, since all debt service will be paid from internal resources of the company.”
Overall, the bonds will have an average life of 5.6 years.
Citizens also said that rating service Standard & Poor’s has revised its outlook from negative to stable for Citizens’ Coastal Account and confirmed its A+ rating on outstanding Citizens bonds.