Neon completes reinsurance deal with StarStone; exits medical malpractice account

Lloyd’s re/insurer Neon has completed a deal with specialty insurer StarStone, a subsidiary of Enstar Group, to reinsure to close (RITC) its 2007 year of account of Syndicate 2468.

The transaction includes a quota share of the Italian public hospital (IPH) portfolio written by the 2008 year of account of Syndicate 2468, and represents a complete exit for Neon from its medical malpractice account relating to IPH.

Neon believes the current Italian team understand the portfolio and will continue to service the business.

Martin Reith, CEO of Neon, said: “The reinsurance transactions with StarStone mark a complete exit from our Italian Public Hospitals account. Given the widely-known issues impacting our syndicate as a result of this legacy portfolio, I am delighted that we are now able to bring finality to our supportive capital providers.

“Whilst we will continue to address legacy issues as part of the turnaround, this represents a key milestone for us – we have drawn a clear line in the sand and the transactions provide further evidence of the positive momentum developed by Neon management since joining.”

Jeff Consolino, chief financial officer at American Financial Group and chairman of Neon Capital, said: “We are pleased that Martin and his new management team have secured agreement to close the 2007 year of account and exit from its Italian Public Hospital exposure.

“Reaching agreement on the reinsurance to close transaction means the Neon management team is better positioned to direct their energies and Neon’s capital resources toward building a strong, profitable business.”