Property insurance capacity in the US is beginning to improve in several regions, creating potential growth opportunities, according to TWFG chairman and CEO Gordy Bunch (pictured above).
However, conditions in California remain challenging, he said during the company’s earnings call.
Bunch noted that California’s property market has not stabilized and pointed to the California FAIR Plan as a key factor. He compared the state's residual market to Citizens in Florida and Louisiana during peak stress periods, saying it has taken on a disproportionate share of risk. He said a rate increase could help rebalance the market.
Bunch also said developments in California’s property segment are tied to wildfire exposure, confidence in new catastrophe models, and reinsurance support. Filing new programs in the state remains difficult, he added, especially when competing with a state-run plan.
TWFG may explore a wrap-around product for the FAIR Plan if market conditions tighten further.
To address current capacity constraints, Bunch said TWFG has secured access to additional secondary and tertiary property markets, which are now available to its agents.
In Florida, TWFG is pursuing expansion after maintaining a limited presence in what Bunch described as a previously volatile market. Following recent legislative reforms, the company is now working with reciprocal and stock insurers to support take-outs from Citizens Property Insurance Corp.
Bunch said TWFG is more open to participating in the Florida market than it had been in the past.
The Woodlands Financial Group (TWFG) is licensed in all 50 states. It operates through 520 retail locations and 14 corporate offices nationwide.
In 2024, TWFG reported robust financial performance. Total revenues for the fourth quarter increased by 30.8% to $51.7 million, up from $39.6 million in the same period the previous year.
Net income for the quarter rose to $8.2 million, compared to $5.2 million in the prior year period. Commission income saw a 20.7% increase, reaching $43.7 million, while contingent income surged by 371.4% to $5.0 million.
Total written premium for the quarter grew by 20.0%, amounting to $361.4 million. The organic revenue growth rate for the quarter was 20.5%, and adjusted EBITDA increased by 91.7% to $13.8 million.
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