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Rising Property Reinsurance Impacts SCMIRF Insurance

SC Municipal Insurance and Risk Financing Fund insures properties, such as town halls, water and wastewater treatment plants and recreational facilities. To provide continuity of city operations, it is important for a city or town to insure against property losses from events such as fires, floods, hurricanes and lightning damage. Because such losses can have very large costs, SCMIRF routinely purchases reinsurance to protect municipalities and its financial integrity, against catastrophic or other large losses. 

The increasing frequency and volatility of events such as hurricanes, severe convective storms, wildfires and floods has resulted in increased property claims not only in South Carolina, but worldwide. A recent PropertyCasualty360 article noted that the definition of natural catastrophes has expanded to events such as winter freezes, like the one experienced in December 2022 during Winter Storm Elliott. 

Increased claims, along with increased building values and inflationary pressures, has resulted in skyrocketing costs to repair or rebuild damaged properties. Unfortunately, increased claims activity and inflationary pressures continues to increase the cost to provide property insurance for SCMIRF members. 

Some property insurers are expected to experience an increase of potentially 50% in reinsurance costs, or possibly a greater amount, during the 2024 renewals. Heather Ricard, director of the Municipal Association of SC’s risk management programs, noted that SCMIRF has already experienced significant growth in reinsurance costs and expects further increases during the January 1, 2024, renewal. 

In order to help reduce property claims and better manage reinsurance cost, Ricard encouraged SCMIRF members to take action now, such as regularly inspecting and maintaining properties; installing leak detection systems; and installing lightning arrestors. Proactive measures such as these can help SCMIRF manage reinsurance costs. 

“Reinsurers consider a number of factors, such as condition of buildings, property locations, as well as overall history, in setting future reinsurance rates, so preventing claims is critical in managing this cost,” Ricard said.   

For more information about SCMIRF, contact Heather Ricard at or 803.933.1258.