Everest adds $600m to casualty reserves

Everest Group strengthened gross casualty reinsurance reserves by $600 million in the third quarter, following more than $200 million in the previous quarter, the Royal Gazette Bermuda Re reported.

The reinsurance treaty segment recorded $253 million of net adverse prior-year reserve development and posted a $191 million underwriting loss for the three months ended Sept. 30. The $600 million gross strengthening was included in that development figure.

The reserve charge came against a smaller premium base: treaty gross written premiums fell 6.2% on a comparable basis to about $2.7 billion, while group gross written premiums fell 14.5% to $3.74 billion.

Investment income rose to $634 million from $540 million, more than covering a $223 million group pre-tax underwriting loss. Everest attributed the gain to higher returns from alternative investments.

Group net income was $233 million, down from $255 million a year earlier, and the combined ratio deteriorated to 107.1% from 103.4%. Pre-tax catastrophe losses rose to $322 million from $50 million. The largest loss events were a Colombia earthquake, events in the Middle East and weather-related losses around the world. For the first nine months of 2026, Everest reported net income of $1.45 billion.

Casualty claims take years to develop and settle, so an underwriting year is repriced long after the premium is booked. Social inflation—rising liability claims costs driven by litigation and larger jury awards—has pushed payouts above what underwriters expected. Munich Re board member Stafan Golling told The Insurer that US liability loss development for the 2014 to 2019 underwriting years was still rising sharply. "I would say we should not be surprised if the market will continue to report further reserve strengthening in the coming years," he said.