AXIS Advances Transition To Specialty Underwriter, Announces Loss Portfolio Transfer Reinsurance Agreement With Enstar On Reinsurance Segment Reserves; AXIS To Retrocede $2.3B Of Reinsurance Reserves To Enstar Under LPT Agreement; Expects $60M Benefit Over Several Years
AXIS Capital Holdings Limited ("AXIS Capital" or "AXIS" or "the Company") (NYSE:AXS) and Enstar Group Limited ("Enstar") (NASDAQ:ESGR) today announced that they have entered into a loss portfolio transfer ("LPT") reinsurance agreement covering a portfolio of reinsurance segment business. The closing of the transaction is subject to regulatory approvals and other customary conditions, and is expected to occur during the first half of 2025.
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Under the LPT reinsurance agreement, which is structured as a 75% ground-up quota share, AXIS will retrocede to Enstar $2.3 billion of reinsurance segment reserves. This transaction is predominantly attributable to casualty portfolios related to 2021 and prior underwriting years totaling $3.1 billion at September 30th. AXIS expects to recognize an approximate $60 million benefit from the excess of reserves ceded over the consideration over the next several years, according to the payment patterns of these reserves. AXIS will maintain claims control for the covered reserves subject to certain administrative rights of Enstar.
The LPT reinsurance agreement will be provided by Enstar's wholly owned subsidiary and S&P 'A' financial strength rated reinsurance platform, Cavello Bay Reinsurance Limited.
