Esure had reported a solvency ratio of just 108% for the year-end 2018
Esure has announced an improved solvency capital coverage ratio of 149%, as of the end of March.
A posting on the London Stock Exchange in February warned that its solvency ratio had dropped from 155% at the year end of 2017 to 110%. Its 2018 results showed solvency coverage had dropped further to 108%.
This had put it only just above its solvency capital requirement, and in need of bolstering.
However, in an update, esure revealed it has restored the solvency ratio to a more healthy 149% through implementing a reinsurance arrangement.
The loss transfer portfolio agreement sees a reinsurer assume the group’s existing open and future claims liabilities through the transfer of the group’s net claims liabilities at 31 March 2019.
The arrangement includes adverse development cover, preventing net claims liabilities deteriorating beyond a pre-agreed point.
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