$1.12 Billion Ends Hartford and Berkshire Reinsurance Fight

Global Insurance Desk: The Hartford has collected a $1.12 billion payment from National Indemnity Company, a Berkshire Hathaway subsidiary, to end a long-running asbestos and environmental reinsurance arrangement and put to rest a related arbitration fight.

Hartford Fire Insurance Company and certain affiliates reached the Reinsurance Commutation and Release Agreement with National Indemnity on September 23. The cash changed hands two days later, at which point the parties formally terminated their Aggregate Excess of Loss Reinsurance Agreement and released each other from further obligations under it.

That original cover dated back to the end of 2016. Hartford had paid a $650 million premium for up to $1.5 billion of protection against adverse development on its asbestos and environmental reserves, which then stood at roughly $1.7 billion. By the close of 2024, the company had exhausted the full $1.5 billion limit after ceding cumulative adverse development of that amount.

Recoveries had started flowing in the first quarter of this year, only for National Indemnity to halt further payments amid the dispute that later went to arbitration. Hartford had disclosed the existence of the arbitration earlier but never publicly described what the disagreement was about.

The company expects the commutation to produce a $497 million pretax gain and lift net income by $393 million for both the third quarter and the first nine months of 2026. The gain stems mainly from the release of a deferred gain that had built up on the retroactive reinsurance. Core earnings will not be affected.

A Hartford spokesman declined additional comment beyond the regulatory filing that disclosed the transaction.

The deal closes a chapter on one of the more significant adverse-development covers struck in the mid-2010s as carriers sought to ring-fence long-tail asbestos and environmental liabilities that continue to generate claims decades after the underlying policies were written.

The details come from The Hartford’s regulatory filing.