Community and Growth

In March 2020, we formalized our longstanding commitment to ESG by establishing a Sustainability Committee with responsibility for overseeing ESG initiatives across the organization and adopting a Human Rights and Environmental Policy. This committee works to identify areas where improvements can be made regarding environmental and social responsibility.

Sustainability

HCI Group is acutely aware of the risks that climate change poses to the insurance industry and our business. There is an emerging scientific consensus on climate change, which may affect the frequency and severity of storms, floods and other severe weather events. As a Florida-focused underwriter, we have a proven track record of managing weather volatility through sound business practices, disciplined risk selection, and technological innovation. We believe these foundational pillars will support profitable growth in Florida and our expansion states as the effects of climate change spread beyond coastal regions.

HCI's Insurance operations cope with climate change in the following ways:

Pricing and coverage

‍Our homeowners policies are issued with only a one-year duration and we have the ability to adjust pricing, coverage, and deductibles on an annual basis to manage increasing climate risk.

Technology-enabled underwriting and administration

‍We exercise significant discretion around which policies we choose to underwrite and administer our policies using an efficient and scalable platform that we developed internally. Our unique approach to risk selection and policy administration allows us to control costs in a way that is differentiated within our industry.

Reinsurance

‍Our insurance subsidiaries maintain robust reinsurance programs with sufficient limits to cover multiple large weather events. Our reinsurance program enjoys strong support from more than 40 reinsurance companies, many of which have partnered with HCI Group for many years.

We believe the combination of dynamic pricing, underwriting, technology, and reinsurance helps to mitigate the impact that climate change has on our business.

Environmental Policy

At HCI Group Inc. we are committed to a long-term sustainable approach to caring for and safeguarding the environment. Specifically, “sustainability” means that we endeavor to balance environmental considerations and social responsibility withour business goals. As a result, we strive to evolve and implement our Corporate Environmental Policy, in addition to complying with environmental laws and regulations. Over the long run, only a sustainable approach will benefit the consumers, customers, shareholders, associates and communities we serve by both meeting our business goals and protecting and improving the quality of the environment in which we all live.

Our environmental policy includes two major components to help minimize our impact on the environment and achieve our objectives around the sustainability:
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Waste Reduction and Recycling

We strive to preserve the environment by using the principles of reducing, reusing, and recycling. The company’s locations recycle office paper, plastics, and aluminum where possible.

Resource Conservation

HCI recognizes the positive impact we can have on the environment and the welfare of our employees by eliminating unnecessary commute times through flexible work schedules. During the COVID pandemic, HCI quickly embraced a work-from-home policy to protect the health and safety of our employees. After careful deliberation, with feedback from our stakeholders, we decided to make aspects of this arrangement permanent through the implementation of a hybrid model, incorporating flexible work schedules and Employee Collaboration Days.

Better managing the environmental footprint of our workforce also extends to our physical offices. As needed, old lamps, ballasts and light switches at company locations are being replaced with high efficiency lighting such as “green” lamps and ballasts. As needed, light switches are being replaced with energy saving motion detector switches that will automatically turn off the lights with a timer after the last person leaves a room. Energy features built into computer hardware, programs and equipment to automatically shut down computer monitors and other peripherals when not in use is being installed on computer equipment.

The environment is a top priority for HCI Group Inc. As a growing company, HCI believes that the well-being of our society depends on a healthy environment and that a proper ethic strives for a sustainable balance between growth and environmental preservation. We recognize our responsibility to provide solutions that help others manage environmental risks, to reduce our own environmental impact, and to make meaningful contributions to environmental causes.

Work Environment

At HCI Group, we recognize that our success is dependent on the quality of our people. We are committed to creating a work environment that encourages and rewards excellence, provides development opportunities for employees at all levels, and fosters an atmosphere of inclusion and respect. Our human capital management focuses on recruiting the best talent, providing competitive compensation packages, offering comprehensive benefits designed to meet individual needs, and implementing programs that promote employee engagement in service to the community. We are proud of our commitment to diversity in hiring practices as well as ongoing initiatives such as mandatory harassment prevention training for all employees.

To ensure professional growth within our organization, we provide access to educational resources and continued education courses. Additionally, we offer incentives through our Bravo program which allows employees to earn paid time off or cash bonuses by participating in charitable causes or engaging in professional development activities. Through these efforts we strive to attract and retain top talent while empowering creativity and innovation across the entire organization.

Our commitment to diversity and inclusion is reflected in the composition of our board and workforce. At the board level, at least half of our board members contribute to gender or ethnic diversity. With respect to our overall workforce, in 2022 62% of our US employees were female and 42% identify as members of a racial or ethnic minority group. In addition, we employ over 100 employees in Noida, India contributing to international diversity.

We celebrate diversity and inclusion across the company and forbid any form of discrimination based upon race, gender, religion, or ethnicity. To that end, beginning in 2022, we authorized Juneteenth (emancipation of enslaved people) as an annual paid holiday for employees.

Core Values

While national governments bear the primary responsibility for upholding human rights, our company practices and policies, including policies addressing equal employment, harassment avoidance, charitable contributions and workplace safety, work to promote and protect human rights.

We strive to conduct our business in a manner that respects the human rights and dignity of all, and we support international efforts to promote and protect human rights. HCI’s core values work to further develop its culture as one committed to ethical business practices and good corporate citizenship. Our policy applies to all employees of HCI Group Inc., its subsidiaries, and affiliates worldwide.

Financial Strength

HCI Group recognizes that our policyholders rely on insurance products to insure what is, in most cases, their most valuable asset —their home. HCI strives to maintain a healthy balance sheet, strong reinsurance program, and robust claims handling capabilities so we can support our policyholders when they are in need.

In recent years, HCI’s insurance subsidiaries withstood several large named storms, including Hurricane Irma in 2017 and Hurricane Ian in 2022, while maintaining strong balance sheets and an Exceptional “A” Financial Stability Rating® from Demotech.

Business Integrity

At HCI Group, we are committed to upholding the highest standards of business ethics and integrity.

We have zero-tolerance policies in place regarding any form of bribery, corruption or unethical behavior. Our Code of Conduct is designed to ensure the conduct of employees, officers and directors remains in compliance with laws, regulations and ethical principles.

Corporate Governance

We believe that strong corporate governance and incentive alignment serves as the bedrock for our organization, business strategy, and execution. Accordingly, HCI has adopted the following policies and programs to promote effective corporate governance:

Board Structure
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We have Audit, Compensation, Governance, and Sustainability Committees with publicly available charters.
We have a Lead Independent Director, and a majority of our directors are also independent.
In 2018, we established an innovative Board Observer Program to broaden our candidate pool and encourage diversity. While our most recent class of observers ended their tenure in 2021, we expect to continue this program in the coming years.
Four HCI directors have been elected from the Board Observer Program, with three of those candidates contributing to gender and ethnic diversity. One of those candidates has since transferred to a position on the board of directors of our subsidiary TypTap Insurance Group, Inc.
We have a director share ownership policy that requires our directors to acquire and hold $200,000 of the Company’s shares within five years of their election.
Our board is highly engaged, typically meeting at least once per month.
Our directors generally sit on no more than three boards, allowing them to focus their attention on HCI Group.

Shareholder Rights
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We have no shareholders rights plan (“poison pill”).
Our Code of Conduct is designed to ensure the conduct of employees, officers and directors remains in compliance with laws, regulations and ethical principles.
We prohibit derivative trading or hedging of our securities by our employees, officers, and directors.

Compensation
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HCI is committed to a pay-for-performance framework for both long and short-term compensation with an overarching goal to align the incentives of our management team with our shareholders.
Our chief executive officer is required to hold shares equaling three times his or her base salary within five years of becoming chief executive officer.
Guided by our Compensation Committee Charter, our board has a Compensation Committee comprised of at least three independent directors, meeting the higher levels of independence as required by the rules of the Securities and Exchange Commission and the New York Stock Exchange. Long-term compensation is awarded in restricted shares and stock options, which vest based on time and performance-based measures.

Committed to a Better Tomorrow

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