Porch Group, Inc. announced on October 28, 2024, that the Texas Department of Insurance (TDI) approved its application to form and license the Porch Insurance Reciprocal Exchange (PIRE). This approval is a key step in Porch's strategy to enhance profitability and stabilize earnings within its Insurance segment by mitigating direct exposure to claims and weather risks.
Under the new structure, Porch will operate as the attorney-in-fact for PIRE, earning commissions and fees that are expected to blend to approximately 20% of Gross Written Premium. Porch plans to contribute $10 million cash to capitalize PIRE in exchange for a surplus note.
The company also intends to sell Homeowners of America Insurance Company (HOAIC) to PIRE on or around January 1, 2025, including all its policies, premium, assets, and liabilities. This strategic realignment is designed to create a simpler, more predictable business with higher margins and growth potential for Porch shareholders.
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