Palomar Holdings Inc, the parent company of Palomar Specialty Reinsurance Company Bermuda Ltd, has announced the successful completion of certain reinsurance programmes starting on June 1, and has increased the company’s full year 2024 adjusted net income guidance.

The company said it procured approximately $400 million of incremental limit to support the growth of its earthquake franchise. Palomar’s reinsurance coverage now extends to $3.06 billion for earthquake events, $735 million for Hawaii hurricane events, and $117.5 million for all continental United States hurricane events.

It added that the reinsurance programme provides ample capacity for the company’s growth in the subject business lines as well as coverage to a level exceeding Palomar’s 1:250-year peak zone probable maximum loss.

Palomar said its per occurrence event retention is $15.5 million for hurricane events, reduced from $17.5 million the previous year, and $20 million for earthquake events, levels that continue to be meaningfully within management’s previously stated guideposts of less than one quarter’s adjusted net income and less than 5 per cent of the company’s surplus on an after-tax basis.

It said $420 million of the $3.06 billion earthquake limit was sourced through a new catastrophe bond, Torrey Pines Re Series 2024-1.

The new catastrophe bond issuance, which is listed on the Bermuda Stock Exchange, is the fifth insurance-linked securities transaction Palomar has sponsored.

“We are very pleased with the successful June 1 placement and are very grateful for the continued support of our reinsurance and ILS partners,” said Mac Armstrong, Palomar’s chairman and chief executive officer.

“Importantly, we renewed our reinsurance programme at terms and pricing that were better than our initial expectations and reduced our hurricane event retention.

“As a result, we are raising our full year 2024 adjusted net income guidance to a range of $122 million to $128 million from the previously indicated range of $113 million to $118 million.”