Legacy specialist Enstar Group announced that one of its wholly-owned subsidiaries closed a previously announced Loss Portfolio Transfer (LPT) agreement with RACQ Insurance to reinsure 80% of RACQ’s motor vehicle Compulsory Third Party (CTP) insurance liabilities covering accident years 2021 and prior.
Effective from July 1, 2022, the reinsurance agreement entails RACQ ceding net reserves amounting to approximately AUD$360 million (USD$235 million).
Enstar’s subsidiary will provide coverage in excess of the ceded reserves, amounting to approximately AUD$200 million (USD$130 million).
The specific amounts of net loss reserves ceded and the settlement and limit amounts provided in the agreement will be adjusted to account for claims paid between the effective date and the closing date of the transaction, as per the contract’s terms.
The completion of this transaction was made possible following the receipt of regulatory approvals and the satisfaction of various other closing conditions.
Enstar Group had announced this LPT agreement in February 2023.
In April, Enstar Group’s wholly owned subsidiaries completed a LPT transaction with certain subsidiaries of QBE Insurance Group on a diversified portfolio of business.
