Bermuda-based insurance group Enstar Group has announced that one of its wholly owned subsidiaries completed a previously announced transaction to reinsure portfolios of Allianz Re’s US run-off business.
The closing followed receipt of regulatory approval and satisfaction of closing conditions. In the transaction, Enstar assumes net reinsurance reserves of approximately $1.1 billion, by reinsuring 50 percent of certain workers’ compensation, construction defect, and asbestos, pollution and toxic tort business originally held by Fireman’s Fund Insurance Company.
Consideration for the transaction includes Enstar transferring approximately $110 million to a reinsurance collateral trust, which was funded from available cash on hand, and the provision of a limited parental guarantee. The combined monetary total of the support offered by Enstar will initially be capped at $270 million.
As part of the transaction, Enstar is providing consulting services with respect to the entire $2.2 billion portfolio, including Allianz Re’s retained 50 percent share.
Enstar Group, Allianz Re, Insurance, Reinsurance, Run-off, Bermuda, North America