Hartford Fire Insurance, National Indemnity terminate A&E reinsurance agreement
The Hartford says it received $1.12 billion in cash on Sept. 25 and expects a $497 million before-tax net gain for the three and nine months ended Sept. 30, 2026.
By Navneeta Nandan Sept 28 (The Insurer) — Hartford Fire Insurance Company and certain of its affiliates and National Indemnity Company (NICO) agreed to terminate their existing aggregate excess of loss reinsurance agreement, which provided asbestos and environmental adverse development cover reinsurance since December 31, 2016. In a regulatory filing submitted by The Hartford Insurance Group to the SEC on September 23, the company added that the commutation agreement also resolves the confidential arbitration regarding the parties' dispute under the reinsurance agreement. 12 billion in cash, terminating the agreement.
As a result, for the three and nine months ended September 30, 2026, The Hartford expects to recognize a before-tax net gain of $497 million, an increase in net income of $393 million, and no impact on core earnings. The Hartford declined to comment further on the commutation and release agreement with NICO. 7 billion. This included both run-off A&E and A&E reserves in business insurance and personal insurance.
The $650 million reinsurance premium was placed in a collateral trust account as security for NICO’s claim payment obligations. The ADC covered substantially all the A&E reserve development up to the reinsurance limit, which was exhausted as of December 31, 2025. 5 billion limit. Cumulative ceded losses up to the $650 million reinsurance premium paid were recognized as a dollar-for-dollar offset to direct losses incurred.
Cumulative ceded losses exceeding the $650 million reinsurance premium paid had resulted in a deferred gain of $850 million.