This Quarterly Report on Form 10-Q contains forward-looking statements. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q may be forward-looking statements. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements regarding: our outlook; our business strategy; writing new business and retaining existing policies; availability of reinsurance coverage; expectations on future growth; future Citizens Property Insurance Corporation (“Citizens”)take-out opportunities; anticipated future operating results and operating expenses, cash flows, capital resources and liquidity; reserves for losses and loss adjustment expenses; competition; future regulatory, judicial and legislative changes; forecasts of future revenues and appropriately planning our expenses; and our plans regarding our capital expenditures and investment portfolio as our business grows. In some cases, you can identify forward-looking statements by terms such as “anticipates,” “believes,” “contemplates,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “targets,” “will,” “would” or the negative of these terms or other similar expressions.
Forward-looking statements are neither historical facts nor assurances of future performance, and are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following:
| • | the potential that we may face significant losses due to being a property and casualty insurer and our exposure to catastrophic events and severe weather conditions, which can be unpredictable; |
| • | our loss reserves are estimates and may be inadequate to cover our actual liability for losses, and actual claims incurred have exceeded, and in the future may exceed, reserves established for claims; |
| • | the dependence of our financial results on the regulatory, legal, economic and weather conditions in Florida due to the fact that we conduct substantially all of our business in Florida; |
| • | changing climate conditions may increase the severity and frequency of catastrophic events and severe weather conditions; |
| • | the severity and frequency of catastrophe events of which of are unpredictable; |
| • | dependence upon the effectiveness of exclusions and other loss limitation methods in the insurance policies we assume or write; |
| • | reliance upon third-party distribution partners, including independent insurance agents, homebuilder-affiliated agents and national insurance carriers; |
| • | our ability to pursue Citizens’ take-out opportunities; |
| • | cyclical changes in the insurance industry; |
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| • | our ability to obtain reinsurance coverage at commercially reasonable rates, or at all; |
| • | credit risk of our reinsurers who may suffer a downgrade; |
| • | the inherent uncertainty of models and our reliance on such models as a tool to evaluate risk, and the dependence of our results upon our ability to accurately price the risks we underwrite; |
| • | the possibility that our information technology systems may fail or be disrupted; |
| • | our ability to expand our business and the possible need to acquire additional capital in the future to fund such expansion; |
| • | the ability of our claims department, or the third-party claims adjusters whom we may engage, to effectively manage or remediate claims as well as unanticipated increases in the severity or frequency of claims; |
| • | the possibility that actual renewals of our existing policies will not meet expectations; |
| • | increased competition and market conditions, including changes in our financial stability and credit ratings; |
| • | the extensive regulatory environment in which we operate that requires approval of rate increases, can mandate rate decreases, and that can dictate underwriting practices and mandate participation in loss sharing arrangements, and other potential further restrictive regulation we may face; |
| • | mandatory assessments or competition for government entities may create short-term liabilities or affect our ability to underwrite more policies; and |
| • | other risks identified in Part II, Item 1A “Risk Factors” in this Quarterly Report on Form 10-Q. |
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PART I – FINANCIAL INFORMATION
