As global non-life run-off reserves climb past $1.1 trillion, deal activity accelerated sharply in 2025, with about 45 publicly disclosed transactions — putting Bermudian-domiciled reinsurers, insurance-linked securities vehicles and investor platforms at the heart of a more sophisticated legacy market.

The shift is less about the size of the reserve pool and more about how it is being accessed, according to panellists at an AM Best briefing.

Andrew Ward, PwC partner, said that his firm now estimated global non-life run-off reserves at “over a trillion dollars”, but only about $23 billion sits on the balance sheets of active legacy acquirers.

“That gap is where innovation is happening,” Mr Ward said, noting the increased use of sidecars, adverse development covers and forward-exit structures — many of them routed through Bermuda for capital, regulation and execution.

Those structures are drawing private equity, ILS managers and specialist reinsurers seeking defined exits rather than permanent capital lock-up. Mr Ward said the market had become “much more specialised and more segmented”, adding that top-tier investors “do not enter this market without a hell of a lot of due diligence and hard work”.

Panellists pointed to a clear move away from one-off disposals towards longer-term strategic partnerships.

Anguel Zaprianov, executive vice-president at Enstar Group, one of Bermuda’s largest players in the run-off space, recently acquired by Sixth Street, said the market had “reinvented itself” from a balance-sheet clean-up tool into a form of specialised underwriting focused on reserve risk, claims management and capital solutions.

Recent transactions illustrate that evolution.

In one deal, Enstar structured a “core exit option” for an American managing general agent, Starwind, and its casualty sidecar, Fractal Re.

Investors were given a defined seven-year exit, at which point Enstar would assume the liabilities on to its own balance sheet — crystallising returns for the investors while freeing up capital.

In another recent transaction, Enstar partnered with Onex, a Canadian private equity firm, to provide a balance-sheet solution that allowed Onex to acquire Accredited free and clear, enabling the buyer to focus on front-end income rather than reserve risk.

A separate deal with Access Capital saw Enstar assume reserve development and capital risk, allowing the cedant to use capital in other initiatives.

“These are not just run-off transactions,” Mr Zaprianov said. “They are capital solutions, strategic solutions and risk-management solutions.”

For cedants, the motivation is increasingly capital efficiency rather than distress, he said.

Raj Bohra, executive vice-president at Gallagher Re, said run-off was now being used to free management focus and support growth.

“It’s more about capital efficiency and not necessarily capital relief,” he said

He added that transferring reserves and associated capital could allow insurers to redeploy their resources into live business opportunities.

Dan Hofmeister, AM Best associate director, said the sector had mastered traditional structured solutions such as adverse development covers and loss portfolio transfers and was now moving towards a more proactive role.

He said: “The model is evolving from ‘we’ll take your troubled business’ to ‘how can we be part of your everyday strategic discussions?'”