James River Group Holdings has entered two principal operating subsidiaries into a loss portfolio transfer reinsurance transaction with Aleka Insurance, a wholly-owned captive insurer of Uber Technologies.
Under the terms of the transaction, Aleka will substantially reinsure all of James River’s legacy portfolio of commercial auto policies relating to Uber’s business, totalling around US$345.1 million in liabilities.
In addition, Bermuda-based insurance holding firm James River will recognise an after-tax loss associated with the loss portfolio transfer of around $23.5 million.
Both of the James River subsidiaries and Aleka are part of an administrative services agreement with Helmsman Management Services for selected claims management services, in which Helmsman will be responsible for the claims handling of reinsured commercial auto policies.
Frank D’Orazio, CEO of James River, comments: “While we are confident in our carried reserves for this portfolio, the transaction brings economic finality to substantially all of our commercial auto run-off portfolio, effectively insulating the portfolio from further potential reserve development.”
“This decisive step enables James River to focus firmly on the future and continue to build on the progress we have made in advancing our core businesses and risk management practices. We are pleased to be working with a long-term insured partner in Uber to pursue our stated goals.”
