Reinsurance News

Enstar completes loss portfolio transfer with Argo

10th November 2022 - Author: Pete Carvill

Enstar has completed a loss portfolio transfer with underwriting firm Argo to reinsure a number of its direct US casualty insurance portfolios relating to accident years 2011 to 2019.

Enstar’s subsidiary covers ground up reserves of $746m and an additional $275m of cover in excess of $821m, up to a policy limit of $1.1bn. Argo will retain a loss corridor of $75m up to $821m.

Dominic Silvester, chief executive officer of Enstar, said: “We are pleased to complete this accretive transaction and partner with Argo. We remain well-positioned with ample capacity and a robust pipeline to provide tailored, capital relief solutions to additional partners and deliver long-term value for our stakeholders.”

Completion of the transaction followed receipt of regulatory approvals and satisfaction of various other closing conditions.

This news comes days after the firm posted a net loss of $444m in Q3 2022. That contrasted with the firm saying that its net loss for the year currently stands at $1.2bn, compared to net earnings of $365m from the same period last year.

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The company also reported a return on equity (ROE) of 10.6% and adjusted ROE of 2.9% for the quarter compared to 2.9% and 2.8%, respectively, in Q3 2021.

The firm noted that ROE was impacted by $395m of net unrealised losses arising primarily from interest rate increases on fixed maturity portfolios that are classified as trading, combined with $151m of net unrealized losses in the company’s non-core portfolios.

Among Enstar’s operational highlights have been the reinsurance agreement it entered into with specialty insurance underwriter, Argo Group International Holdings, for ground up reserves of $746m, and its completed agreement with Probitas Managing Agency Limited to cover 2018 and prior year of account exposures of Syndicate 1492.

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