In separate announcements late Wednesday, CNA Financial Corp. and Enstar said they had reached an agreement to have a subsidiary of Enstar reinsure a legacy portfolio of excess workers comp policies, representing $690 million in prior-year loss reserves.

Under the retroactive reinsurance agreement, CNA will cede net excess workers compensation liabilities relating to business written in 2007 and prior from its principal operating subsidiary Continental Casualty Company.

The reinsurance deal has an aggregate limit of $1 billion.

In a statement, CNA Chair and CEO Dino Robusto said, “The transfer of legacy reserves supports CNA’s continued commitment to advancing our core business.”

The transaction is expected to close in the first quarter of 2021, subject to regulatory approval and other closing conditions, at which time CNA expects to recognize an after-tax loss of approximately $12 million.

Sources: CNA, Enstar