The Porch Group and others have announced that the Texas Department of Insurance has approved its application to form insurance reciprocal exchanges. This announcement was shared in a post on the company's website.
On October 28, 2024, Porch Group announced that the Texas Department of Insurance (TDI) approved its application to form and license the Porch Insurance Reciprocal Exchange (PIRE), a new homeowners insurance reciprocal exchange. According to Porch Group, this strategic move aims to increase profitability and stabilize earnings by reducing direct exposure to claims and weather-related risks. Porch will serve as the operator, managing PIRE's operations, similar to models used by Farmers Insurance and Erie Insurance. The company plans to contribute $10 million in cash to capitalize PIRE and intends to sell Homeowners of America Insurance Company (HOAIC) to PIRE around January 1, 2025. As the operator, Porch expects to earn commissions and fees blending to a take rate of approximately 20% of Gross Written Premium.
In February 2025, Clearcover, a next-generation auto insurer, launched the Clearcover Inter-Insurance Exchange (CIX), a reciprocal exchange designed to extend the company's reach into the non-standard auto insurance market. CIX operates on a subscriber-based model, meaning policyholders collectively own a stake in the exchange, which can help keep premiums competitive. Initially launching in Illinois, Clearcover plans to scale CIX's operations to additional markets, aiming to enhance profitability, drive growth, and redefine the auto insurance experience.
In March 2025, The Baldwin Group announced the signing of a note purchase agreement to raise $110 million in surplus financing for the launch of its debut reciprocal insurance exchange, the Builder Reciprocal Insurance Exchange (BRIE). Of this amount, $95 million will be funded by Gallatin Point Capital, with the remaining provided by Baldwin affiliates. BRIE will focus on providing capacity for the firm's builder-sourced homeowners book of business, with Baldwin's specialty managing general agency division serving as the attorney-in-fact.
Texas maintains a robust insurance market, ranking as the nation's second-largest and sixth-largest globally with $265.7 billion in premiums written in 2023. According to TDI data, despite challenges such as rising premiums due to inflation and severe weather events, TDI's regulatory efforts have fostered a competitive environment. This is evidenced by the approval of over ten new property and casualty insurers entering the market since 2023. These developments indicate a healthy insurer environment in Texas with increased capacity and options for consumers.
