Bermuda-based insurance and reinsurance firm Everest has entered into an adverse development reinsurance agreement, effective October 1, 2025, supported by Longtail Re, an affiliate of Stone Ridge Holdings Group, with the cover composed of two layers in excess of the $5.4 billion of North America Insurance and Other segment liability subject reserves.
The second layer is $500 million, for which Everest will pay approximately $122 million in consideration upon closing the transaction, which will be reported as an incurred loss during the fourth quarter of 2025.
As per the firm, it will have a co-participation of $100 million in each layer, and the agreement will be accounted for as a retroactive reinsurance agreement.
“The agreement provides $1.2 billion of gross limit protection against future adverse reserve development arising from substantially all insurance policies written by Everest Insurance’s® North American business for accident years 2024 and prior. Everest will retain sole authority to handle and resolve claims,” the firm added.
Gallagher Re acted as the sole structuring agent and advisor for the transaction.
Jim Williamson, Everest President and Chief Executive Officer, commented, “The transaction is a decisive step in strengthening our reserves and insulating our US Casualty insurance portfolio from further potential reserve development.
“We are pleased to be working with long-time partner Stone Ridge to enhance our risk capacity, optimize capital efficiency and deliver greater value to our clients and shareholders.”
In related news, AIG today revealed that it has entered into definitive agreements to acquire the renewal rights to the majority of Everest’s global retail insurance portfolios, representing approximately $2 billion in aggregate premium.
Terms of the agreements were not disclosed. Except in the European Union, AIG expects to commence writing policies for existing Everest clients on January 1, 2026.
Peter Zaffino, Chairman & CEO, AIG, said, “We expect these renewal rights transactions to drive incremental growth in our general insurance portfolio, and we will be able to write these policies within our existing balance sheet with no incremental capital required.
“Jim Williamson, President and CEO of Everest Group, and the underwriting team at Everest have done a very good job repositioning Everest’s global retail insurance portfolio, and we see these portfolios as very additive to our business.
“We look forward to working closely with the Everest team to ensure a seamless transition for clients and brokers, while continuing to meet their needs with world-class solutions and exceptional service. AIG will continue to work with Everest Group as a key reinsurance partner.”
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