Everest gets revised negative outlook from AM Best following Q3’25 reserve charges

Core Viewpoint - AM Best has revised the outlooks of Everest Group, Ltd. and its subsidiaries to negative from stable, while affirming strong financial ratings [1][2] Group and Company Summary - Everest Group, Ltd. and its operating subsidiaries have received a negative outlook, with affirmed Financial Strength Rating (FSR) of A+ and Long-Term Issuer Credit Ratings (Long-Term ICR) of "aa-" [1][2] - The Long-Term ICRs for Everest Reinsurance Holdings, Inc. have also been affirmed at "a-" with a negative outlook [2] Financial Performance and Risks - The ratings reflect Everest's strong balance sheet, adequate operating performance, favorable business profile, and effective enterprise risk management (ERM) capabilities [3] - Recent developments indicate elevated uncertainty surrounding Everest's business profile and ERM, particularly due to significant reserve charges [3][4] - In Q3, Everest reported reserve charges of $478 million primarily related to its retail commercial insurance business, marking the second material reserve charge in 12 months [4] Strategic Changes and Future Outlook - The uncertainty is compounded by the decision to sell its retail commercial book of business through a renewal rights transaction with American International Group, Inc., and the signing of an adverse development cover for prior accident years [5] - AM Best noted that the addition of an adverse development cover and the sale of the retail commercial insurance business could enhance confidence in Everest's future performance [6] - The negative outlooks reflect increased operational risk as Everest shifts its strategy to focus on reinsurance and global specialty insurance segments, which constitute over 80% of its business [6]