US retail insurer Lemonade renewed its reinsurance programme, expecting to cede around 18% of premium to reinsurers.
This is a drop from 20% previously and means that the firm will retain a larger share of its gross profit.
Lemonade said it had grown its coverage for “higher-volatility and catastrophe-exposed risks”, which includes additional tail catastrophe protection.
The insurer added that it also expected to update its ancillary reinsurance programmes, which included allowing its property per risk coverage to expire while growing its European catastrophe excess of loss programme.
“This renewal improves Lemonade's reinsurance economics, coverage, and capital efficiency at the same time,” said Tim Bixby, chief financial officer of Lemonade. “We are retaining more premium, adding protection against the volatility that matters most, and doing so on terms that are attractive on a risk-adjusted basis.”