Business Context and Reporting Period
This Form 8-K filing by Palomar Holdings, Inc. (PLMR) is dated May 29, 2026. The report discloses the successful completion of reinsurance programs effective June 1, 2026, and an update to the company's full-year 2026 adjusted net income guidance.
Key Financial Metrics and Reinsurance Capacity
- Earthquake Coverage: Total reinsurance coverage exhausts at $3.92 billion, supported by approximately $421 million of incremental limit.
- Hurricane Coverage (Continental U.S.): Coverage exhausts at $135 million.
- Hawaii Hurricane Coverage (Laulima Exchange): Per occurrence coverage increased to $865 million (a $130 million year-over-year increase).
- Retention Levels:
- Hurricane events: $11 million per occurrence.
- Earthquake events: $20 million per occurrence.
- Insurance Linked Securities (ILS): The company issued its seventh catastrophe bond, Torrey Pines Re Series 2026-1, securing $410 million of protection. Total multi-year ILS capacity stands at $1.28 billion.
Material Changes Versus Prior Period
- Guidance Update: The company increased its full-year 2026 adjusted net income guidance (specific figures not provided in the filing text).
- Capacity Expansion: Added $421 million in incremental earthquake limits and $130 million in Hawaii hurricane coverage compared to the prior year.
- Capital Structure: Expanded the reinsurance panel to over 100 reinsurers and ILS investors, all rated "A-" or better or fully collateralized.
Outlook, Management Commentary, and Risks
Management states the new reinsurance program provides ample capacity for growth and coverage exceeding the company's 1:250-year peak zone Probable Maximum Loss (PML). Retention levels remain within management's guideposts of less than one quarter's adjusted net income and less than 5% of stockholders' equity. The program includes prepaid reinstatements across substantially all layers, limiting additional premium costs in multiple event scenarios.
Investor Verification Checklist
- Verify the specific numerical increase in the full-year 2026 adjusted net income guidance referenced in the press release (Exhibit 99.2).
- Confirm the terms and pricing of the Torrey Pines Re Series 2026-1 catastrophe bond.
- Review the updated corporate presentation (Exhibit 99.1) for detailed growth projections.
- Assess the impact of the $1.28 billion ILS capacity on the company's overall capital efficiency.