AXIS completes $2.3bn LPT deal with Enstar

AXIS Capital has finalised a $2.3 billion loss portfolio transfer agreement with Enstar Group.

The Bermuda-based global specialty re/insurer said it will retain claims control under the deal, while Enstar will assume associated reserves and handle specified administrative functions.

The LPT reinsurance deal covers $3.1 billion in reserves as of September 30, 2024, with AXIS ceding $2.3 billion to Enstar under a 75% ground-up quota share.

AXIS expects a roughly $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, the company previously indicated. 

“AXIS will maintain claims control for the covered reserves subject to certain administrative rights of Enstar,” it said.

This follows a $425 million charge in January 2024 to address pre-2019 liability claims, pushing AXIS to a $150 million Q4 loss — down from a $40.9 million profit in 2022.

The LPT reinsurance agreement was provided by Enstar’s wholly owned subsidiary, Cavello Bay Reinsurance.

Completion of the transaction followed receipt of regulatory approvals and satisfaction of various other closing conditions.

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