Enstar Group has announced that its wholly-owned subsidiaries have reached an agreement for a ground-up Loss Portfolio Transfer (LPT) with certain subsidiaries of QBE on a diversified portfolio of business.
Enstar states that this business covers International and North American financial lines, European and North American reinsurance portfolios, and several US discontinued programs.
The firm’s subsidiaries will assume net loss reserves from QBE of $1.9bn and will provide $900m of cover in excess of the ceded reserves on business largely underwritten between 2010 and 2018.
The transaction will complete upon receipt of regulatory approvals and satisfaction of various other closing conditions.
Upon completion, a portion of the portfolio currently underwritten via QBE’s Lloyd’s syndicates 386 and 2999 will be transferred into Enstar syndicate 2008.
Dominic Silvester, Enstar’s Chief Executive Officer, commented, “This transaction, our second significant collaboration with leading insurance group, QBE, represents a unique and emerging business opportunity for Enstar.
“In addition to covering QBE’s discontinued lines, we are providing our expertise on seasoned liabilities within ongoing lines of business as a source of value creation.
“This innovative structure requires strong alignment of interests, and we have secured that with our long-standing partner QBE.”
Towards the end of last year, Enstar announced that it had 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.
At the time, Enstar said that its subsidiaries would cover ground up reserves of $746m and an additional $275m of cover in excess of $821m, up to a policy limit of $1.1bn, while Argo would retain a loss corridor of $75m up to $821m.