What Happens Now That Florida’s Insurance Capital Stack is Decimated?

The Florida insurance market capital stack is likely decimated after hurricane Ian's landfall last week, raising the question of how this marketplace replenishes it and also highlighting the need for access to efficient sources of capital.

But that access to capital can't be at any price and someone is going to have to pay something risk commensurate to get access to it.

Which is a discussion for another day, about trimming the fat out of the insurance risk-to-capital chain, but right now more immediate pressures may emerge, as Florida's insurance market is looking at a serious depletion of surplus and capital.

Let's work through the industry stack, starting with insurer capital.

The Florida specialists are going to have been seriously impacted by hurricane Ian and it's not expected that they'll all survive this event. Exactly who will fail is harder to tell at this stage, although names are beginning to be mentioned of which carriers might struggle and could end up under the watchful eye of the Florida Department of Financial Services (DFS).