SiriusPoint Ltd
For the period ended Dec 31, 2025. Filed Feb 24, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 24, 2026
SPNT$26.41+0.3%Stored close · as of Nov 9, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-21.
0001576018-25-000010
Item 1A. Risk FactorsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-24.
0001576018-26-000032
Item 1A. Risk FactorsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 317 previous paragraphs and 302 current paragraphs.
165 unchanged; 103 reworded; 33 added; 46 removed; 3 previous and 1 current paragraphs rearranged.
Tables are not compared: 0 previous and 0 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (33)
Current report
•Operational Risks. Operational risks include risks related to our ability to attract, develop and retain key personnel, distribution partners and underwriting talent, fluctuations in our results of operations, the performance of strategic partnerships, joint ventures, delegated underwriting authorities, and other third party relationships, including risks associated with delegating authority to third party managing general agents (“MGAs”).
Current report
•Technology Risks. Technology risks include risks related to operational, cybersecurity, and technology-related risks, including system failures, data breaches, or business interruption events, impacting the Company directly or indirectly through our business partners and service providers.
Current report
We may be adversely impacted by inflation and the changing tariff landscape.
Current report
A significant amount of communication between our employees and our business banking and investment partners depends on information technology and electronic data exchange. We also license certain systems, platforms, datasets and, increasingly AI-driven tools and models from third parties and rely on cloud-based infrastructure and externally hosted systems. We cannot be certain that we will maintain continued access to these systems, platforms, datasets or models, or that they will operate as intended. AI models may produce inaccurate, biased, or unpredictable outputs, may degrade over time, or may require retraining based on data we do not control. We also cannot guarantee that we could replace these tools without degrading operational performance or slowing our underwriting or claims response time. In addition, if we adopt an overly cautious approach in evaluating, updating, or integrating new technology or AI‑enabled systems, we may delay necessary improvements, prolong exposure to outdated or less secure systems, or impede operational efficiency, which could increase our vulnerability to cybersecurity incidents or other technology‑related failures.
Current report
Like all companies, our information technology systems are susceptible to interruptions or failures related to events beyond our control, including natural disasters, terrorist attacks, third party service outages, and general technology failures. As AI technologies become more integrated into our operations, failures, errors or unexpected behavior in these systems could also disrupt key business processes. We believe that we have established and implemented appropriate security measures, controls, and procedures to safeguard our systems and periodically evaluate and test their adequacy, including through vulnerability assessments, penetration testing, and employee training. We also maintain business continuity and disaster recovery plans designed to support continued operations of key business processes during disruptive events, including disruptions arising from cybersecurity or AI-related incidents. Nonetheless, disruptions or breaches of our information technology and AI-enabled systems — whether at our Company or affecting our third party providers — remain possible and may negatively impact our business.
Current report
We are subject to evolving cybersecurity, data protection, and AI-related laws and regulations across the jurisdictions in which we operate. Regulatory expectations for cybersecurity governance, AI governance, reporting, and operational resilience continue to increase globally. Compliance with new or developing requirements — including AI model documentation, data governance controls, risk assessments, testing, third‑party oversight, breach notification, and incident response protocols — may increase our compliance costs and operational burdens. As our operations expand into additional jurisdictions and as the regulatory landscape for AI and automated decision-making evolves, we expect that our cybersecurity, data privacy, and AI compliance costs will continue to rise.
Current report
If coverage for terrorist acts cannot be excluded, we may face significant gaps in our reinsurance protection. Because terrorist events cannot be predicted with statistical certainty, estimating potential losses is difficult, and a future attack could materially impact our financial condition and results of operations. These events may also trigger multiple claims, and contractual provisions intended to limit our liability may not be effective.
Current report
In addition to physical climate risks, we may face growing market expectations to support a low-carbon transition by reducing or eliminating underwriting and investment exposure to carbon-intensive industries, which could render portions of our business less sustainable. Climate-related governmental policies, including emission restrictions and mandated technologies, may further reduce demand for our products and affect the performance of related investments. We are also subject to complex and rapidly changing climate-related laws and policy initiatives, the implications of which are uncertain and may adversely impact on our business.
Current report
Legislation adversely affecting the private insurance and reinsurance markets may be enacted at the federal, regional or state level. While similar bills were proposed but not enacted in prior years, in 2025 members of Congress reintroduced significant federal catastrophe reinsurance legislation, including the Incorporating National Support for Unprecedented Risks and Emergencies (INSURE) Act, which would create a federally backed catastrophic property loss reinsurance program capitalized with federal funds. If enacted, this program would provide reinsurance above certain loss thresholds for a wide range of perils and could serve as a subsidized public‑sector alternative to private catastrophe reinsurers, potentially reducing the role of the private market and limiting demand for our products. Industry groups have expressed concern that such legislation could shift catastrophic risk to federal taxpayers, distort market pricing, and reduce the need for private reinsurance capacity. Even if not enacted in its current form, continued reintroduction and growing political attention to catastrophe‑insurance availability may increase the likelihood of federal intervention in the future.
Current report
In addition, worsening insurance‑market conditions—such as insurer withdrawals from high‑risk states and rising reinsurance costs—have contributed to renewed legislative momentum. These conditions, particularly in catastrophe‑exposed states such as California, Florida, Texas, and Louisiana, have prompted policymakers to consider federal or expanded state‑level mechanisms to stabilize property‑insurance markets. In California specifically, heightened wildfire risk, regulatory rate‑approval constraints, and increased insurer non‑renewals have led to extensive legislative and administrative activity aimed at maintaining residential‑property‑insurance availability. For example, the California Department of Insurance has advanced proposals that would expand the use of catastrophe‑modeling in rate filings while also conditioning such changes on insurers’ participation in writing coverage in designated wildfire‑exposed ZIP codes. California lawmakers and regulators have also considered or implemented revisions to the FAIR Plan’s structure, coverage obligations, and permissible rate levels. Any expansion of the FAIR Plan or imposition of mandatory‑writing or market‑stabilization requirements on private insurers could reduce demand for private reinsurance or alter the mix, pricing, or risk profile of the exposures we reinsure. Legislative or regulatory initiatives that constrain insurers’ ability to obtain actuarially adequate rates in California could also reduce private‑market capacity and further encourage public‑sector or quasi‑public alternatives, thereby limiting demand for our catastrophe‑exposed products in the state. Any such measures, if adopted, could reduce market share available to private insurers and reinsurers and adversely affect our ability to price or offer catastrophe‑exposed coverage profitably.
Current report
State legislation also continues to evolve. Florida, for example, has in the past enacted laws altering the size, operations, or competitive position of Citizens Property Insurance Corporation (“Citizens”) and the Florida Hurricane Catastrophe Fund (“FHCF”) in ways that expanded their role relative to the private market. Additional legislative action in Florida or other catastrophe‑prone states could further diminish aggregate private‑market demand for our products. Because we are a significant provider of catastrophe‑exposed coverage globally and in these regions, any reduction in private‑market participation or shift toward public‑sector mechanisms could disproportionately and adversely affect our business, financial condition, and results of operations.
Current report
Independent rating agencies assess the financial strength and claims-paying ability of insurers and reinsurers based on criteria established by each agency. These criteria incorporate assessments of capital adequacy, operating performance, enterprise risk management, and other factors, many of which are influenced by general economic and market conditions outside of our control. Rating agencies may revise their criteria, methodologies, or outlooks at any time and, as a result, our ratings are subject to change at the sole discretion of the agencies. Policyholders, brokers, agents, reinsurers, investors, and other counterparties rely heavily on these ratings when evaluating the financial soundness and competitiveness of insurance and reinsurance providers, making our ratings an important factor in maintaining and growing our business.
Current report
Leadership transitions — whether planned or unplanned — can create challenges that may adversely impact our business if not effectively managed. Changes in key senior management may divert leadership attention from our financial, operational and strategic objectives, disrupt the continuity of ongoing initiatives, or reduce organizational morale. Difficulty attracting, integrating, or retaining qualified senior leaders could negatively affect our ability to execute our strategic plans, maintain strong governance practices, and preserve important relationships with clients, MGAs, regulators and other business partners. Any such disruption, or the perception that we are not effectively managing leadership transitions, may be viewed negatively by rating agencies and shareholders, which could adversely affect our ratings, financial performance, and long‑term strategic positioning.
Current report
Our future success depends significantly extent on the leadership, industry knowledge, and execution of our strategic goals by senior management team and our senior underwriting executives. The pool of executives with the breadth of experience required in our industry remains limited, and competition for qualified leaders continues to be strong. The departure of one or more members of senior management or other key personnel could delay, disrupt or prevent the effective implementation of our business strategy and could materially and negatively impact our operations and performance.
Current report
We also maintain offices across multiple jurisdictions — including the U.S., Canada, Bermuda, the U.K., Sweden and Switzerland — some of which impose residency, licensing, or work‑authorization requirements that may affect our ability to recruit or retain personnel. For example, Bermuda law restricts non‑Bermudians from working in Bermuda without an approved work permit issued by the Bermuda Department of Immigration. If the Bermuda Department of Immigration, or any similar governing authority in jurisdictions where we operate, were to modify its policies in a way that prevents existing employees from continuing in their roles or limits our ability to hire qualified personnel, our operations could be disrupted and our financial performance could be adversely affected. We do not currently maintain key person life insurance on any member of our senior management. If a member of senior management were to die, become incapacitated, or leave the Company to pursue other opportunities, we would be solely responsible for identifying and recruiting a suitable replacement. Any delay or inability to fill such a critical role could materially and negatively impact our business and hinder the achievement of our strategic goals.
Current report
In addition, our ability to upstream dividends or other distributions may also be limited by factors beyond explicit regulatory constraints, including adverse financial performance at our operating subsidiaries, increased capital needs driven by business growth, volatility in underwriting or investment results, or strategic decisions to retain capital to support current or future regulatory, ratings‑agency, or business requirements. These operational or financial pressures could reduce the amount of distributable capital available to us, further constraining our ability to pay dividends or service our obligations at the holding‑company level.
Current report
Because we depend on dividends and other permissible payments from our operating subsidiaries, any regulatory or financial restriction on their ability to distribute funds to us could materially and adversely affect our liquidity, financial condition, ability to pay dividends to shareholders, and our ability to meet obligations under our outstanding indebtedness.
Current report
In line with industry practice, we often remit claims payments to reinsurance brokers and MGAs, who then forward those funds to the ceding companies. If a broker or MGA fails to transfer these amounts, we may remain liable for the payment, depending on the jurisdiction. Conversely, premiums paid by clients to reinsurance brokers or MGAs are often deemed paid to us, even if we have not actually received them. Because intermediaries generally maintain lower capital levels than the insurers and reinsurers they serve, their financial distress or failure could result in credit losses to us.
Current report
We may be unable to purchase the retrocessional coverage we need, or we may be unable to collect on such coverage, either of which could adversely affect our business, financial condition, and results of operations.
Current report
We obtain retrocession to manage concentrations of risk, but market conditions can limit the availability, credit quality or terms of such protection. Although we place retrocession with reinsurers that have strong financial strength ratings, a reinsurer’s financial condition may deteriorate, and its insolvency, refusal, or inability to pay claims would leave us fully responsible for the underlying liabilities.
Current report
At times, pricing or capacity constraints may lead us to retain more risk by purchasing less, or no, retrocession for certain exposures or regions. This increases our potential losses in the event of significant insured events and may materially affect our financial results.
Current report
Strategic transactions involve financial, accounting, tax, regulatory, integration, and operational challenges. They may also expose us to unforeseen liabilities, business disruption, retention issues, or unfavorable market conditions. Divestitures carry their own risks, including failure to achieve expected value, post‑closing claims, and distraction to ongoing operations. Acquisitions or strategic investments may underperform relative to the price paid, fail to deliver expected synergies, or result in unexpected charges.
Current report
Through these transactions, we may assume unknown or undisclosed business, operational, tax, regulatory, or compliance liabilities. Due‑diligence and indemnification protections may not fully mitigate these risks. In addition, our strategic investments are generally illiquid and subject to transfer restrictions, meaning we may be unable to sell them when desired, secure an acceptable price, or avoid substantial or total losses.
Current report
We are required to maintain effective disclosure controls and procedures and internal control over financial reporting. While these controls are designed to provide reasonable assurance, no control system can prevent all errors or fraud. All systems have inherent limitations—including the risk of human error, faulty judgment, breakdowns in operation, or circumvention through collusion or individual misconduct. Controls may also become inadequate over time due to changes in conditions or deterioration in compliance.
Current report
As we execute our strategy to expand and deepen our relationships with MGAs — including through selective investments, acquisitions, and the development of new or existing subsidiaries and partnerships — we may incur losses and face additional risks. While these partnerships can enhance distribution of our insurance products and services, they may also expose us to heightened cyber, technology, and emerging-asset risks (such as cryptocurrency risk), as well as increased equity exposure to early-stage MGAs that carry significant uncertainty of success.
Current report
Many MGAs in which we invest are early-stage businesses with higher operating costs, evolving business models, and greater execution risk. Our MGA investments are generally illiquid and are subject to transfer restrictions, which may prevent us from selling our interests when desired or from securing an acceptable price. As a result, we face the possibility of highly variable returns on investments, including substantial or total loss of our invested capital.
Current report
In some cases, we also provide reinsurance to our MGA partners, increasing our potential exposure to underwriting and operational performance risk. There is no assurance that we will be able to successfully incubate, scale, or generate earnings from these partnerships.
Current report
Although we conduct business, financial, and legal due diligence before pursuing MGA investments and other strategic opportunities, such diligence may not identify all material issues. Some opportunities may not be successfully executed or may require significant financial, managerial and operational resources. These factors could have a negative impact on our operating results, financial condition, and ability to achieve expected strategic benefits.
Current report
We conduct due diligence before entering into MGA arrangements, but if we fail to confirm that an MGA has sufficient underwriting expertise or regulatory understanding, or if the MGA’s business is early‑stage with limited historical data or rapidly evolving products or markets, we may incur losses, including those related to initial pricing and reserving.
Current report
In addition, rating agencies and other organizations increasingly assess companies based on their ESG performance. Unfavorable ESG ratings — whether of our company or of the industries in which we operate — may influence investor sentiment, limit access to capital, or divert investment to competitors viewed as better aligned with ESG expectations.
Current report
In addition, we may be subject to regulations, guidance, and determinations issued by regulatory authorities empowered under the Healthcare Act. Compliance with evolving healthcare‑related rules could increase operating costs or limit our ability to offer certain products, and adverse regulatory actions or changes could negatively impact our business, financial condition, and results of operations.
Current report
Limited or changing analysts coverage could adversely affect our share price.
Current report
The market for our common stock relies in part on research analysts who publish reports about our business, financial performance, and industry. If one or more analysts cease coverage of us, reduce the frequency or depth of their reports, or publish negative or inaccurate commentary, our stock price and trading volume could decline. Analyst coverage is outside our control. Reduced visibility in the investment community may limit investor awareness of our company, decrease demand for our shares, and contribute to increased volatility. In addition, if analyst estimates differ from our actual results, or if we fail to meet published expectations, our stock price could be adversely affected even if our underlying business performance remains consistent.
Removed paragraphs (46)
Previous report
•Operational Risks. Operational risks include risks related to retention of key employees and internal controls.
Previous report
•Cyber Risks. Cyber risks include risks related to technology breaches or failures, including those resulting from a malicious cyber-attack on us or our business partners and service providers.
Previous report
We may not successfully implement our strategic transformation or fully realize the anticipated benefits from the transformation.
Previous report
As part of our strategic transformation, we have focused on: (i) re-underwriting to reduce underwriting volatility and improve performance, (ii) de-risking our investment portfolio and (iii) re-balancing the business mix in our portfolio and growing the Insurance & Services segment. Further, as part of our strategic transformation, we made changes to the structure and composition of our international branch network. We reduced the locations from which we underwrite property catastrophe reinsurance. We closed our offices in Hamburg, Miami and Singapore, and reduced our footprint in Liege and Toronto. Following these closures and the scaling of our operations, we continue to serve clients and underwrite property catastrophe reinsurance business from Bermuda.
Previous report
Our ability to achieve our strategic transformation is subject to a number of risks, including:
Previous report
•We may experience lower premium growth from our reinsurance business as we reshape our reinsurance book, which may not be offset by increased premiums in our Insurance & Services business or appreciation of our strategic investments in the near term or at all.
Previous report
•We may be unsuccessful in recruiting and retaining the talent required to operate and grow our Insurance & Services business as we face competition for such talent from larger or more well-established companies with a stronger brand association and greater resources.
Previous report
•We may experience departure of employees with historical institutional knowledge which may be disruptive to, or cause uncertainty in, our business. The failure to ensure a smooth transition and effective transfer of knowledge involving senior employees could hinder our strategic execution.
Previous report
•Our profitability and share price may be impacted by the loss of premium growth from the reinsurance business as the changes we make to our business take time to implement.
Previous report
•The transformation may require significant management time and effort and may divert attention from our core existing operations.
Previous report
We cannot assure you that we will be able to continue to successfully implement our transformation initiatives. Further, our ability to achieve the anticipated benefits of this transformation, including the anticipated levels of cost savings and efficiencies, within expected timeframes is subject to many estimates and assumptions, which are, in turn, subject to significant economic, competitive and other uncertainties, some of which are beyond our control. We may not be able to successfully implement, or fully realize the anticipated positive impact of, our transformation initiatives, or execute successfully on our transformation strategy, in the expected timeframes or at all. In addition, our efforts, if properly executed, may not result in our desired outcome of improved financial performance.
Previous report
We may continue to be adversely impacted by inflation.
Previous report
Furthermore, a significant amount of communication between our employees and our business, banking and investment partners depends on information technology and electronic information exchange. We have licensed certain systems and data from third parties. We cannot be certain that we will have access to these, or comparable systems, or that our technology or applications will continue to operate as intended. In addition, we cannot be certain that we would be able to replace these systems without slowing our underwriting response time. Like all companies, our information technology systems are vulnerable to interruptions or failures due to events that may be beyond our control, including, but not limited to, natural disasters, terrorist attacks and general technology failures.
Previous report
We believe that we have established and implemented appropriate security measures, controls and procedures to safeguard our information technology systems and to prevent unauthorized access to such systems and any data processed or stored in such systems, and we periodically evaluate and test the adequacy of such measures, controls and procedures. In addition, we have established a business continuity plan which is designed to ensure that we are able to maintain all aspects of our key business processes functioning in the midst of certain disruptive events, including any disruptions to or breaches of our information technology systems. Despite these safeguards, disruptions to and breaches of our information technology systems are possible and may negatively impact our business.
Previous report
The cybersecurity regulatory environment is evolving, and we expect the costs of complying with new or developing regulatory requirements will increase. In addition, as our operations expand to other jurisdictions, we will be required to comply with cybersecurity laws in those jurisdictions, which will further increase our cost of compliance.
Previous report
In the event coverage of terrorist acts cannot be excluded, we, in our capacity as a primary insurer, would have a significant gap in our own reinsurance protection with respect to potential losses as a result of any terrorist act. It is impossible to predict the occurrence of such events with statistical certainty and difficult to estimate the amount of loss per occurrence they will generate. If there is a future terrorist attack, the possibility exists that losses resulting from such event could prove to be material to our financial condition and results of operations. Terrorist acts may also cause multiple claims, and our attempts to limit our liability through contractual policy provisions may not be effective.
Previous report
In addition to physical risks, we may also encounter market pressure to contribute to a low-carbon economy. This involves reducing insurance liability exposure or no longer underwriting risks for carbon-intensive businesses, as well as reducing asset portfolio exposure or ceasing investments in such businesses. There is a potential risk that certain aspects of our business cease to be viable due to this transition. Government policies or regulations aimed at slowing climate change, such as emission controls or technology mandates, may have an adverse impact on the demand for our products and our investments in relevant sectors. We are subject to complex and changing laws, regulation and public policy debates relating to climate change which are difficult to predict and quantify and may have an adverse impact on our business.
Previous report
Legislation adversely impacting the private markets could be enacted on a state, regional or federal level. In the past, federal bills have been proposed in Congress which would, if enacted, create a federal reinsurance backstop or guarantee mechanism for catastrophic risks, including those we currently insure and reinsure in the private markets. These measures were not enacted by Congress; however, new bills to create a federal catastrophe reinsurance program to back up state insurance or reinsurance programs, or to establish other similar or analogous funding mechanisms or structures, may be introduced. We believe that such legislation, if enacted, could contribute to the growth, creation or alteration of state insurance entities in a manner that would be adverse to us and to market participants more generally. If enacted, bills of this nature would likely further erode the role of private market catastrophe reinsurers and could adversely impact our financial results, perhaps materially. Moreover, we believe that numerous modeled potential catastrophes could exceed the actual or politically acceptable bonded capacity of Citizens Property Insurance Corporation (“Citizens”) and of the Florida Hurricane Catastrophe Fund (“FHCF”). This could lead to a severe dislocation or the necessity of federal intervention in the Florida market, either of which would adversely impact the private insurance and reinsurance industry.
Previous report
From time to time, the state of Florida has enacted legislation altering the size and the terms and operations of the FHCF and the state sponsored insurer, Citizens, in ways that expanded the ability of Citizens to compete with private insurance companies and other companies that cede business to us, which reduced the role of the private insurance and reinsurance markets in Florida. We cannot assess the likelihood of other related legislation passing, or the precise impact on us, our clients or the market should any such legislation be adopted. Because we are a large provider of catastrophe-exposed coverage globally and in Florida, adverse legislation may have a greater adverse impact on us than it would on other reinsurance market participants. In addition, other states, particularly those with Atlantic or Gulf Coast exposures or seismic exposures (such as California), may enact new or expanded legislation that would diminish aggregate private market demand for our products.
Previous report
Third-party rating agencies assess and rate the financial strength, including claims-paying ability, of insurers and reinsurers. These ratings are based upon criteria established by the rating agencies and are subject to revision at any time at the sole discretion of the rating agencies. Some of the criteria relate to general economic conditions and other circumstances outside of the rated company's control. These financial strength ratings are used by policyholders, agents and brokers to assess the suitability of insurers and reinsurers as business counterparties and are an important factor in establishing our competitive position in insurance and reinsurance markets.
Previous report
In December 2024, we entered into a $400 million senior unsecured revolving credit facility (the “Facility”) with JPMorgan Chase Bank, N.A. as administrative agent. In certain circumstances, a downgrade of our debt ratings will result in an increase in interest rates and fees, which could require the use of cash that we might otherwise use in operating our business. See “Risks Relating to Our Business—Inability to service our indebtedness could adversely affect our liquidity and financial condition and could potentially result in a downgrade or withdrawal of our credit ratings, any of which could adversely affect our financial condition and results of operations.”
Previous report
A significant decrease in our capital or surplus would enable certain clients to terminate reinsurance agreements or to require additional collateral.
Previous report
Certain of our reinsurance contracts contain provisions that permit our clients to cancel the contract or require additional collateral in the event of a downgrade in our ratings below specified levels or a reduction of our capital or surplus below specified levels over the course of the agreement. Whether a client would exercise such cancellation rights would likely depend, among other things, on the reason the provision is triggered, the prevailing market conditions, the degree of unexpired coverage and the pricing and availability of replacement reinsurance coverage.
Previous report
Leadership transitions can be inherently difficult to manage, and any future transitions may cause disruption to our business due to, among other things, diverting management’s attention away from the Company’s financial and operational goals or causing a deterioration in morale. Failure to attract and retain key senior management may negatively impact our credit ratings and impact our client, MGA and other third-party relationships, which may adversely impact our financial and operational goals and strategic plans, as well as our financial performance.
Previous report
Our future success depends to a significant extent on the efforts of our senior management and our senior underwriting executives to implement our business strategy. We believe there are only a limited number of available and qualified executives with substantial experience in our industry. Accordingly, the loss of the services of one or more of the members of our senior management or other key personnel could delay or prevent us from fully implementing our business strategy and, consequently, significantly and negatively affect our business. In addition, we have offices in various jurisdictions such as Belgium, Bermuda, Canada, Sweden, Switzerland, the U.K., and the U.S. many of which may have residency and other mandatory requirements that may affect our personnel. For example, our ability to hire in Bermuda is constrained by Bermuda law, which provides that non-Bermudians are not permitted to engage in any occupation in Bermuda without an approved work permit from the Bermuda Department of Immigration. If the Bermuda Department of Immigration, or any similar governing body in any of the jurisdictions in which we maintain offices, changes its current policies with respect to work permits resulting in our employees being unable to work in such jurisdictions, our operations could be disrupted and our financial performance could be adversely affected.
Previous report
We do not currently maintain key person life insurance with respect to any of our senior management. If any member of senior management dies or becomes incapacitated, or leaves the company, for example, to pursue employment opportunities elsewhere, we would be solely responsible for locating an adequate replacement for such senior management and for bearing any related cost. To the extent that we are unable to locate an adequate replacement or are unable to do so within a reasonable period of time, our business may be significantly and negatively affected.
Previous report
In accordance with industry practice, we frequently pay amounts owed on claims under our policies to reinsurance brokers and MGAs that, in turn, remit these amounts to the ceding companies that have reinsured a portion of their liabilities with us. In the event a broker or MGA fails to make such a payment, depending on the jurisdiction, we may remain liable to the client for the deficiency. Conversely, in certain jurisdictions, when the client pays premiums for policies to reinsurance brokers or MGAs for payment to us, these premiums are considered to have been paid and the client will no longer be liable to us for these premiums, whether or not we have actually received them. Intermediaries generally are less capitalized than the businesses we reinsure and therefore may be unable to pay their debts when due. Consequently, we assume a degree of credit risk associated with reinsurance brokers around the world.
Previous report
We may be unable to purchase reinsurance for the liabilities we reinsure, and if we successfully purchase such reinsurance, we may be unable to collect, which could adversely affect our business, financial condition and results of operations.
Previous report
We have purchased, and may continue to purchase, retrocessional coverage in order to mitigate the effect of a potential concentration of losses upon our financial condition. While we are selective in regard to our reinsurers, placing reinsurance with those reinsurers with strong financial strength ratings from AM Best, S&P or a combination thereof, the financial condition of a reinsurer may change based on market conditions. The insolvency or inability or refusal of a reinsurer to make payments under the terms of its agreement with us could have an adverse effect on us because we remain liable to our client. From time to time, market conditions have limited, and in some cases have prevented, reinsurers from obtaining the types and amounts of retrocession that they consider adequate for their business needs. Accordingly, we may not be able to obtain our desired amounts of retrocessional coverage or negotiate terms that we deem appropriate or acceptable or obtain retrocession from entities with satisfactory creditworthiness. Our failure to establish adequate retrocessional arrangements or the failure of our retrocessional arrangements to protect us from overly concentrated risk exposure could significantly and negatively affect our business, financial condition and results of operations.
Previous report
In addition, due to factors such as the price or availability of reinsurance coverage, we sometimes decide to increase the amount of risk retained by purchasing less reinsurance or no reinsurance for a particular geographical region. Such determinations have the effect of increasing our financial exposure to losses associated with such risks and, in the event of significant losses associated with a given risk, could have a material adverse effect on our financial condition and results of operations.
Previous report
We pursue strategic transactions from time to time, including acquisitions or dispositions of businesses or assets. Any strategic transactions could be significant and could have a material adverse impact on our reputation, business, results of operation or financial condition. We face a number of risks arising from these types of transactions, including financial, accounting, tax and regulatory challenges; difficulties with integration, business retention, execution of strategy, unforeseen liabilities or market conditions; and other managerial or operating risks and challenges. Divestitures subject us to risks such as failure to obtain appropriate value, post-closing claims being levied against us and disruption to our other businesses during the negotiation or execution process or thereafter. Our acquisitions or strategic investments may underperform relative to the price paid or resources committed by us; we may not achieve anticipated cost savings; or we may otherwise be adversely affected by transaction-related charges. These risks and difficulties may prevent us or delay us from realizing the expected benefits from the strategic transactions we enter into.
Previous report
Through our acquisitions or strategic investments, we may also assume unknown or undisclosed business, operational, tax, regulatory and other liabilities and be subject to reputational concerns, fail to properly assess known contingent liabilities, or assume businesses with internal control deficiencies or regulatory compliance issues. Risk-mitigating provisions that we put in place in the course of negotiating and executing these transactions, such as due diligence efforts and indemnification provisions, may not be sufficient to fully address these liabilities and contingencies. As our strategic investments are generally illiquid and we are subject to transfer restrictions in relation to those investments, we may be unable to sell our interests in those investments at the desired time or to find a buyer for our interests, and therefore, we are at risk of highly variable returns on investments and substantial or total loss in relation to those investments.
Previous report
We are required to maintain effective disclosure controls and procedures and internal control over financial reporting. Effective internal controls are necessary for us to provide reliable financial reports and prevent fraud. Our management does not expect that our disclosure controls or our internal controls over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met, as a result of the inherent limitations in all control systems. These inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons or by collusion of two or more people. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate.
Previous report
As part of our strategic plan, we may continue to selectively invest in or acquire MGAs and develop business through new or existing subs and partnerships. Such plans have involved, and may at times involve, additional selective investments in, or acquisitions of, MGAs and the development of businesses through new or existing subsidiaries and partnerships. While we believe our partnerships with MGAs will facilitate the distribution of our insurance products and services, we may also have increased exposure to additional risks, such as cyber and crypto currency. In addition, the investments in these MGAs may result in increased equity concentration in early-stage MGAs that carry a high degree of uncertainty of success. In some cases, we may provide reinsurance to these MGAs. We may not be able to successfully incubate and develop or generate any earnings from these partnerships.
Previous report
It is not possible at this time to fully predict the future prospects or other characteristics of such businesses. Moreover, many of the MGAs we have invested in, and may invest in, are early-stage companies that carry higher operating expenses and a higher degree of uncertainty. Our investments in MGAs are illiquid, and we are subject to transfer restrictions in relation to those investments. We may be unable to sell our interests in those investments at the desired time or to find a buyer for our interests, and therefore, we are at risk of highly variable returns on investments and substantial or total loss in relation to those investments. Although we intend to conduct business, financial and legal due diligence in connection with the evaluation of any future investment opportunities, our due diligence investigations may not identify every matter that could have a material adverse effect on us. Efforts to pursue certain investment opportunities may be unsuccessful or require significant financial or other resources, which could have a negative impact on our operating results and financial condition.
Previous report
We have and may continue to enter into arrangements with MGAs to secure insurance and reinsurance policies on our behalf. Pursuant to these arrangements, we grant MGAs delegated authority to underwrite risks on our behalf. While we perform due diligence prior to entering into these arrangements, if we do not perform the appropriate level of due diligence or if we fail to confirm that the MGA has adequate knowledge of the underwriting process and relevant regulations, we could face significant losses, which could have an adverse effect on our business, financial condition and operating results. In addition, the insurance and re-insurance business written by some of the MGAs we partner with is inherently uncertain because these MGAs are typically early-stage ventures which may lack historical data, are growing rapidly and may represent new products, markets or technologies. As a result, we may face significant losses if we do not properly address the risks, including but not limited to the initial reserving and pricing of the business produced by the MGAs.
Previous report
In addition, organizations that provide information to investors on corporate governance and related matters have developed ratings processes for evaluating companies on their approach to ESG matters, and unfavorable ratings of our company or our industries may lead to negative investor sentiment and the diversion of investment to other companies or industries.
Previous report
Post Brexit developments could negatively impact SiriusPoint’s investment portfolio, business and results of operations.
Previous report
The impact of the withdrawal of the U.K. from the E.U. in 2019/20, referred to as “Brexit”, on the U.K. economy continues to incrementally develop but has largely stabilized, however aspects of the post Brexit arrangements remain under review between the U.K. and E.U. and continue to develop. The continued post-Brexit political landscape and dialogue between the U.K. and E.U. could result in potential negative impacts, such as increased volatility and illiquidity, and potentially lower economic growth on markets in the U.K. and Europe, which may negatively impact the value of SiriusPoint's investment portfolio, business and results of operations.
Previous report
In 2016 and early 2021, one of our legacy U.S. subgroups with legacy tax attributes experienced an “ownership change” for purposes of Section 382 of the Internal Revenue Code of 1986, as amended (the "Code"), which is defined as an increase in the percentage of ownership (by value) of one or more "5-percent shareholders" (as defined in the Code) by more than 50% over the lowest percentage owned by such shareholders at any time during the prior three years (calculated on a rolling basis). As a result, such U.S. subgroup is subject to annual limitations on its tax loss and credit carryforwards based on the equity value of the subgroup immediately before each ownership change, multiplied by an IRS-published rate. We have taken into account the application of Section 382 in evaluating the recoverability of our net deferred tax assets in the U.S. In the event the U.S. subgroup experiences another ownership change in the future, the Section 382 limitation would apply on top of the pre-existing Section 382 limitations.
Showing the first 40 of 46 passages. Open the source sections for the rest.
Reworded paragraphs (103)
Previous wording
•Strategic Risks. Strategic risks include failure to execute on our strategy of re-underwriting to reduce underwriting volatility and improving underwriting performance, de-risking our investment portfolio, and transforming our business, including re-balancing our portfolio and growing the Insurance & Services segment; and risks arising from any strategic transactions such as acquisitions, dispositions, investments, mergers or joint ventures or entry into new lines of business.
Current wording
•Strategic Risks. Strategic risks include risks associated with the development and execution of our business strategy, including our strategy to expand and deepen our relationships with MGAs and any strategic transactions such as acquisitions, dispositions, investments, mergers, joint ventures, or entry into new lines of business.
Previous wording
•Catastrophe Risks. Catastrophe risks include, among other things, the impact of the COVID-19 pandemic or other unpredictable catastrophic events, such as natural perils and other disasters, such as hurricanes, windstorms, earthquakes, floods, wildfires and severe winter weather, on various lines of our business, including predominantly our property catastrophe excess line of business, and also our aviation, casualty, contingency, credit and accident and health (including trip cancellation) businesses.
Current wording
•Catastrophe Risks. Catastrophe risks include, among other things, natural catastrophes, extreme weather events, epidemics, pandemics, man-made events and other large loss occurrences, including hurricanes, windstorms, earthquakes, floods, wildfires, and severe winter weather, on various lines of our business, including predominantly our property catastrophe excess line of business, and also our aviation, casualty, contingency, credit, and accident and health (including travel insurance) businesses.
Previous wording
•Insurance Underwriting Risks. Insurance underwriting risks include inadequate pricing or loss and loss adjustment reserves.
Current wording
•Insurance Underwriting Risks. Insurance underwriting risks include the adequacy, accuracy and development of pricing or loss and loss adjustment reserves, the lack of available capital, periods characterized by excess underwriting capacity and unfavorable premium rates, and our ability to maintain or improve underwriting discipline, risk selection, and portfolio diversification across lines and geographies.
Previous wording
•Market, Credit and Liquidity Risks. Market, credit and liquidity risks include risks related to the performance of financial markets, impact of inflation, foreign currency fluctuations, economic and political conditions, inability to raise the funds necessary to pay the principal of our interest on our outstanding debt obligations and a downgrade or withdrawal of our financial ratings.
Current wording
•Market, Credit, and Liquidity Risks. Market, credit, and liquidity risks include risks related to the performance and volatility of financial markets, credit events, interest rate movements, inflation, foreign exchange fluctuations, changes in asset valuation, economic and political conditions (including uncertainties and conflicts), inability to raise the funds necessary to pay the principal of our interest on our outstanding debt obligations and a downgrade or withdrawal of our financial ratings.
Previous wording
•Competition Risks. Competition risks include risks related to our ability to compete successfully in the insurance and reinsurance market and the effect of consolidation in the insurance and reinsurance industry.
Current wording
•Competition Risks. Competition risks include risks related to our ability to compete successfully in the insurance and reinsurance market, the cyclicality of these markets, and the effect of consolidation in the insurance and reinsurance industry.
Previous wording
•Climate Change Risks. Climate change risks include risks such as increased severity and frequency of weather-related natural disasters and catastrophes and increased coastal flooding in many geographic areas.
Current wording
•Climate Change Risks. Climate change risks include risks such as increased severity and frequency of weather-related natural disasters and catastrophes, including wildfires, and increased coastal flooding in many geographic areas.
Previous wording
•Regulatory and Litigation Risks. Regulatory and litigation risks include risks related to the outcome of legal and regulatory proceedings, regulatory constraints on SiriusPoint’s business, including legal restrictions on certain of
Current wording
•Regulatory and Litigation Risks. Regulatory and litigation risks include risks related to the outcome of legal and regulatory proceedings, regulatory, legal, and compliance developments affecting our insurance, reinsurance, MGAs, Lloyd’s or international operations, including capital, solvency, reporting, conduct risk, and data protection requirements, regulatory constraints on SiriusPoint’s business, including legal restrictions on certain of SiriusPoint’s insurance and reinsurance subsidiaries’ ability to pay dividends and other distributions to SiriusPoint, and losses from unfavorable outcomes from litigation and other legal proceedings.
Previous wording
•seasonality of the insurance and reinsurance businesses;
Current wording
•seasonality and cyclicality of the insurance and reinsurance businesses;
Previous wording
In 2024, economies around the world continued to experience heightened levels of inflation, which caused central banks to respond by raising interest rates. In operating our business, we are continuing to experience the effects of inflation. Furthermore, our operations, like those of other insurers and reinsurers, are susceptible to the effects of inflation because premiums are established before the ultimate amounts of losses and loss expenses are known. Although we consider the potential effects of inflation when setting premium rates, premiums may not fully offset the effects of inflation and thereby essentially result in underpricing the risks we insure and reinsure. Loss reserves include assumptions about future payments for settlement of claims and claims-handling expenses, such as the value of replacing property, associated labor costs for the property business we write and litigation costs. To the extent inflation causes costs to increase above loss reserves established for claims, we will be required to increase loss reserves with a corresponding reduction in net income in the period in which the deficiency is identified, which may have a material adverse effect on our results of operations or financial condition. Unanticipated higher inflation could also lead to additional interest rate increases, which would negatively impact the value of our fixed income securities and potentially other investments. To the extent higher inflation could lead to currency fluctuations, we may also experience increased volatility in foreign exchange gains and losses in our financial statements.
Current wording
Economies around the world continue to experience heightened levels of inflation. Inflation can be caused by any number of factors including, but not limited to, expansionary monetary policy and deficit spending by the government, rising wages, an imbalance of the supply and demand for goods, supply chain disruptions and the imposition of tariffs. Recently, the U.S. administration imposed and/or announced (and in some cases postponed) tariffs on imports from various countries and on certain products, which may lead to retaliatory tariffs on U.S. exports, unpredictable economic consequences including inflation, trade wars and capital market volatility. In operating our business, we are continuing to experience the effects of inflation, along with potential further economic impact from the changing tariff landscape. Furthermore, our business, like those of other insurers and reinsurers, are susceptible to the effects of inflation because premiums are established before the ultimate amounts of losses and loss expenses are known. Although we consider the potential effects of inflation when setting premium rates, premiums may not fully offset the effects of inflation and thereby essentially result in underpricing the risks we insure and reinsure. Loss reserves include assumptions about future payments for settlement of claims and claims-handling expenses, such as the value of replacing property, associated labor costs for the property business we write and litigation costs. To the extent inflation causes costs to increase above loss reserves established for claims, we will be required to increase loss reserves with a corresponding reduction in net income in the period in which the deficiency is identified, which may have a material adverse effect on our results of operations or financial condition. Unanticipated higher inflation could lead to additional interest rate increases, which would negatively impact the value of our fixed income securities and potentially other investments. The changing tariff landscape may hinder economic growth that may in turn impact our credit and mortgage business. Heightened market volatility could lead to a rise in credit spread which could impact the company’s short-term capital and liquidity positions. To the extent higher inflation could lead to currency fluctuations, we may also experience increased volatility in foreign exchange gains and losses in our financial statements.
Previous wording
Technology breaches or failures, including those resulting from a malicious cyber-attack on us or our business partners and service providers, could disrupt or otherwise negatively impact our business.
Current wording
Operational, cybersecurity, technology-related, and artificial intelligence (“AI”) risks, including system failures, data breaches, ransomware attacks, supply chain compromises of third party service providers, failures or harmful outputs of AI models, or other business interruption events — including those resulting from malicious cyber-attacks on us or our business partners or service providers — could disrupt or otherwise negatively impact our business.
Previous wording
Our business depends upon our ability to securely process, store, transmit and safeguard confidential and proprietary information that is in our possession. This information includes confidential information relating to our business, personally identifiable information and protected health information belonging to employees, customers, claimants and business partners. We implement and maintain reasonable security processes, practices and procedures appropriate to the nature of the information we hold, and we rely on sophisticated commercial control technologies to maintain security and confidentiality of our systems. Nevertheless, our systems are vulnerable to a variety of forms of unauthorized access, including hackers, computer viruses, and cyber-attacks from individual or state actors, as well as breaches that result from employee error or malfeasance or lost or stolen computer devices. For example, the Russia/Ukraine conflict has created, and may, along with other global conflicts, continue to create heightened cybersecurity threats to our information technology infrastructure.
Current wording
Our business depends upon our ability to securely process, store, transmit, and safeguard confidential and proprietary information that is in our possession. This information includes confidential information relating to our business, as well as personally identifiable information and protected health information belonging to employees, customers, claimants and business partners. We implement and maintain reasonable security processes, practices, and procedures appropriate to the nature of the information we hold, and we rely on sophisticated commercial control technologies — including, increasingly, AI-enabled technologies — to maintain security and confidentiality of our systems. Nevertheless, our systems are vulnerable to a variety of forms of unauthorized access, including hackers, computer viruses, ransomware, AI-enabled social engineering attacks, and cyber-attacks carried out by individual or state-sponsored actors. In addition, breaches can result from employee error, malfeasance, or lost or stolen devices. Heightened geopolitical tensions and ongoing international conflicts have also contributed to an increase in the frequency, sophistication, and potential impact of global cybersecurity threats, including those amplified by generative AI technologies.
Previous wording
It is possible that insurance policies we have in place with third parties would not entirely protect us in the event that we experienced a breach, interruption or widespread failure of our information technology systems. In addition, in the ordinary course of our business we process personal information and personal health information in connection with claims made under our accident and health business, as well as other business lines. A misuse or mishandling of personal information being sent to or received from an employee, client or other third party could damage our business or our reputation or result in significant monetary damages, regulatory enforcement actions, fines and criminal prosecution in one or more jurisdictions which would not be covered by insurance. Although we attempt to protect this personal information, and have implemented privacy procedures and training programs to mitigate the risk of a privacy breach, we may be unable to protect personal information in all cases. As a result, we could be held responsible for violations of global data privacy laws, such as the General Data Protection Regulation, for our failure, or the failure on the part of our third party vendors or agents, to securely process, store or transmit such personal information. The potential consequences of a material privacy incident include reputational damage, litigation with third parties and remediation costs, which in turn could have a material adverse effect on our results of operations.
Current wording
It is possible that insurance policies we have in place with third parties would not fully protect us against losses arising from a breach, interruption, AI-driven system failure or widespread failure of our information technology systems. In the ordinary course of our business, we process personal information and personal health information in connection with claims made under our accident and health business, as well as other business lines. Any misuse, mishandling, or unauthorized disclosure of such information — whether by us, a policyholder, or a third party vendor -- could damage our business or reputation, result in significant monetary damages, regulatory enforcement actions, fines, or criminal prosecution which may not be fully covered by insurance. The use of AI tools may increase the risk of inadvertent data exposure, improper data ingestion, or unauthorized model training on sensitive information. Although we maintain privacy procedures and employee training programs intended to mitigate these risks, we may be unable to prevent unauthorized access to or disclosure of personal information in all cases.
Previous wording
We cannot assure you that we will be able to compete successfully in the insurance and reinsurance market. Our failure to compete effectively would significantly and negatively affect our financial condition and results of operations may increase the likelihood that we are deemed to be a passive foreign investment company or an investment company. See“Risks Relating to Taxation—If we were treated as a passive foreign investment company (“PFIC”) for U.S. federal income tax purposes, our U.S. shareholders would be subject to adverse tax consequences.”
Current wording
We cannot assure that we will be able to compete successfully in the insurance and reinsurance markets, and any failure to do so could materially and adversely affect our financial condition and results of operations and may increase the likelihood that we are deemed to be a passive foreign investment company or an investment company. See“Risks Relating to Taxation—If we were treated as a passive foreign investment company (“PFIC”) for U.S. federal income tax purposes, our U.S. shareholders would be subject to adverse tax consequences.”
Previous wording
The insurance and reinsurance industry, including our competitors, customers and insurance and reinsurance brokers, has experienced significant consolidation over the last several years. These consolidated client and competitor enterprises may try to use their enhanced market power to negotiate price reductions for our products and services and/or obtain a larger market share through increased line sizes. If competitive pressures require us to reduce our prices, we would generally expect to reduce our future underwriting activities, resulting in reduced premiums and a reduction in expected earnings. If the insurance industry consolidates further, competition for customers could become more intense and we could incur greater expenses relating to customer acquisition and retention, further reducing our operating margins. In addition, insurance companies that merge may be able to spread their risks across a consolidated, larger capital base so that they require less reinsurance. Reinsurance intermediaries could also continue to consolidate, which may adversely affect our ability to access business and distribute our products. We could also experience more robust competition from larger, better capitalized competitors. Any of the foregoing could adversely affect our business or our results of operations.
Current wording
The insurance and reinsurance industry, including our competitors, customers and insurance and reinsurance brokers, has experienced significant consolidation over the last several years. These consolidated client and competitor enterprises may try to use their enhanced market power to negotiate price reductions for our products and services and/or obtain a larger market share through increased line sizes. If competitive pressures require us to reduce our prices, we would generally expect to reduce our future underwriting activities, resulting in reduced premiums and a reduction in expected earnings. If the insurance industry consolidates further, competition for customers could become more intense and we could incur greater expenses relating to customer acquisition and retention, further reducing our operating margins. In addition, insurance companies that merge may be able to spread their risks across a consolidated, larger capital base so that they require less reinsurance. Reinsurance intermediaries could also continue to consolidate, which may adversely affect our ability to access business and distribute our products. We could also face competition from larger and better- capitalized companies, and any such competitive pressures could adversely affect our business or our results of operations.
Previous wording
Many of our contracts are written for a one-year term. In our financial forecasting process, we make assumptions about the renewal of certain prior year’s contracts. The insurance and reinsurance industries have historically been cyclical businesses with periods of intense competition, often based on price. If actual renewals do not meet expectations or if we choose not to write on a renewal basis because of pricing conditions, our premiums written in future years and our future operations would be materially adversely affected.
Current wording
Many of our contracts are written for a one-year term. In our financial forecasting process, we make assumptions about the renewal of certain prior year’s contracts. The insurance and reinsurance industries have historically been cyclical businesses with periods of intense competition, often based on price. If actual renewals do not meet expectations, or if we choose not to renew certain contracts because of pricing conditions, our premiums written in future years and our future operations would be materially adversely affected.
Previous wording
We outsource a number of technology and business process functions to third-party providers. We may continue to do so in the future as we review the effectiveness of our organization. If we do not effectively select, develop, implement and monitor our outsourcing relationships, we may not realize productivity improvements or cost efficiencies and may experience operational difficulties, increased costs and a loss of business that may have an adverse effect upon on our operations or financial condition.
Current wording
We outsource a number of technology and business process functions to third-party providers. We may continue to do so in the future as we review the effectiveness of our organization. If we do not optimally select, develop, implement, and monitor our outsourcing relationships, we may not realize productivity improvements or cost efficiencies and may experience operational difficulties, increased costs, and a loss of business that may have an adverse effect upon on our operations or financial condition.
Previous wording
We periodically negotiate provisions and renewals of these relationships, and such terms may not remain acceptable to us or such third parties. If such third-party providers experience disruptions or do not perform as anticipated, or we experience problems with a transition to a third-party provider, we may experience operational difficulties, an inability to meet obligations (including, but not limited to, policyholder obligations), a loss of business and increased costs, or suffer other negative consequences, all of which may have a material adverse effect on our business and results of operations. In addition, our ability to receive services from third-party providers based in different countries might be impacted by political instability, unanticipated regulatory requirements or policies inside or outside of the U.S. As a result, our ability to conduct our business might be adversely affected.
Current wording
We periodically negotiate provisions and renewals of these relationships, and such terms may not remain acceptable to us or such third parties. If such third-party providers experience disruptions or do not perform as anticipated, or we experience problems with a transition to a third-party provider, we may experience operational difficulties, an inability to meet obligations (including, but not limited to, policyholder obligations), a loss of business, increased costs, or suffer other negative consequences, all of which may have a material adverse effect on our business and results of operations. In addition, our ability to obtain services from third-party providers operating in other jurisdictions may be adversely impacted by political instability, unexpected regulatory developments, or governmental policy changes within or outside the United States. As a result, our ability to conduct our business might be adversely affected.
Previous wording
We, and our MGAs and other agents who have the ability to bind policies on our behalf, rely on information provided by insureds or their representatives when underwriting insurance policies. While we may make inquiries to validate or supplement the information provided, we may make underwriting decisions based on incorrect or incomplete information. It is possible that we will misunderstand the nature or extent of the activities and the corresponding extent of the risks that we insure because of our reliance on inadequate or inaccurate information. If any such agents exceed their authority, engage in fraudulent activities or otherwise fail to comply with applicable laws when conducting business on our behalf, our financial condition and results of operations could be materially adversely affected.
Current wording
We, and our MGAs and other agents with binding authority, rely on information provided by insureds or their representatives when underwriting insurance policies. Although we may make inquiries to validate or supplement the information provided, underwriting decisions may still be based on incomplete or inaccurate information, and we may consequently misunderstand the nature or extent of the activities we insure or the corresponding risks. In addition, if any such agents exceed their delegated authority, engage in fraudulent or improper conduct, or otherwise fail to comply with applicable legal or regulatory requirements while conducting business on our behalf, our financial condition and results of operations could be materially adversely affected.
Previous wording
Given the inherent uncertainty of models and software, their usefulness as a tool to evaluate risk is subject to a high degree of uncertainty that could result in actual losses that are materially different than our estimates including PMLs, and our financial results may be adversely impacted, perhaps significantly.
Current wording
Given the inherent uncertainty of models and software, their usefulness as a tool to evaluate risk is subject to a high degree of uncertainty that could result in actual losses that are materially different than our estimates including Probable Maximum Losses (PMLs), and our financial results may be adversely impacted, perhaps significantly.
Previous wording
We use third-party vendor and proprietary analytic and modeling capabilities, including global property catastrophe models, which consolidate and report on all our worldwide property exposures, to calculate expected PML from various property natural catastrophe scenarios. We use these models and software to help us control risk accumulation, inform management and other stakeholders of capital requirements and to improve the risk/return profile in our overall portfolio of insurance and reinsurance contracts. However, given the inherent uncertainty of modeling techniques and the application of such techniques, these models and databases may not accurately address a variety of matters impacting our coverages. The construction of these models and the selection of assumptions requires significant actuarial judgement.
Current wording
We use third-party vendor and proprietary analytic and modeling capabilities, including global property catastrophe models, which consolidate and report on all our worldwide property exposures, to calculate expected PML from various property natural catastrophe scenarios. We use these models and software to help us control risk accumulation, inform management and other stakeholders of capital requirements, and to improve the risk/return profile in our overall portfolio of insurance and reinsurance contracts. However, given the inherent uncertainty of modeling techniques and the application of such techniques, these models and databases may not accurately address a variety of matters impacting our coverages. The construction of these models and the selection of assumptions require significant actuarial judgment.
Previous wording
For example, catastrophe modeling is dependent upon several broad economic and scientific assumptions, such as storm surge (the water that is pushed toward the shore by the force of a windstorm), demand surge (the localized increase in prices of goods and services that often follows a catastrophe) and zone density (the percentage of insured perils that would be affected in a region by a catastrophe). Third-party modeling software also does not provide information for all regions or perils for which we write business. Catastrophe modeling is inherently uncertain due to process risk (the probability and magnitude of the underlying event) and parameter risk (the probability of making inaccurate model assumptions).
Current wording
For example, catastrophe modeling relies on a number of broad economic and scientific assumptions, including storm surge (the water that is pushed toward the shore by the force of a windstorm), demand surge (the localized increase in the prices of goods and services following a catastrophe), and zone density (the proportion of insured exposures in a region that may be affected by a catastrophic event). Third-party modeling software also does not capture all regions or perils for which we write business. In addition, catastrophe models are inherently uncertain due to process risk — the probability and magnitude of the underlying event — and parameter risk — the probability that model assumptions are inaccurate. Although we maintain model‑governance and validation processes intended to reduce these risks, such controls cannot eliminate the inherent uncertainty of models or prevent significant variances between modeled outcomes and actual results.
Previous wording
The inherent uncertainties underlying, or the incorrect usage or misunderstanding of, these tools may lead to unanticipated exposure to risks relating to certain perils or geographic regions which could have a material adverse effect on our business, prospects, financial condition or results of operations. Furthermore, these models typically rely on either precedent or industry data, both of which may be incomplete or may be subject to errors by employees, failure to document transactions properly, failure to comply with regulatory requirements or information technology failures. Given the inherent uncertainty in these models as well as the underlying assumptions and data, the results of our models may not accurately address the emergence of a variety of matters which might impact certain of our coverages. Some forms of insurance and reinsurance provide coverage for aggregated loss result over a period of time making it inherently difficult to track how these coverages will be impacted by any single or series of events. Accordingly, these models may understate the exposures we are assuming and our financial results may be adversely affected, perhaps significantly. Any such impact could also be felt across our insurance and reinsurance contract portfolio, since similar models and judgment are used in analyzing the majority of our transactions. For more information about the risks resulting from the inherent uncertainty of modeling techniques, see“Risks Relating to Our Business—Our claims and claim expense reserves are subject to inherent uncertainties, which could cause our losses to exceed our loss reserves.”
Current wording
The inherent uncertainties underlying, or the incorrect usage or misunderstanding of, these tools may lead to unanticipated exposure to risks relating to certain perils or geographic regions which could have a material adverse effect on our business, prospects, financial condition, or results of operations. Furthermore, these models typically rely on either precedent or industry data, both of which may be incomplete or may be subject to error, failure to document transactions properly, failure to comply with regulatory requirements, or information technology failures. Given the inherent uncertainty in these models, as well as the underlying assumptions and data, the results of our models may not accurately address the emergence of a variety of matters which might impact certain of our coverages. Some forms of insurance and reinsurance provide coverage for aggregated loss result over a period of time making it inherently difficult to track how these coverages will be impacted by any single or series of events. Accordingly, these models may understate the exposures we are assuming and our financial results may be adversely affected, perhaps significantly. Any such impact could also be felt across our insurance and reinsurance contract portfolio, since similar models and judgment are used in analyzing the majority of our transactions. For more information about the risks resulting from the inherent uncertainty of modeling techniques, see“Risks Relating to Our Business—Our claims and claim expense reserves are subject to inherent uncertainties, which could cause our losses to exceed our loss reserves.”
Previous wording
Our claims and claim expense reserves reflect our estimates, using actuarial and statistical projections at a given point in time, of our expectations of the ultimate settlement and administration costs of claims incurred. We use actuarial and computer models, historical reinsurance and insurance industry loss statistics, and management’s experience and judgment to assist in the establishment of appropriate claims and claim expense reserves. Reserves are estimates of claims an insurer or reinsurer ultimately expects to pay, based upon facts and circumstances known at the time, predictions of future events, estimates of future trends in claim severity and other variable factors. The inherent uncertainties of estimating loss reserves generally are greater for reinsurance and MGA produced insurance businesses as compared to traditional primary insurance, primarily due to:
Current wording
Our claims and claim expense reserves reflect our estimates, using actuarial and statistical projections at a given point in time, of our expectations of the ultimate settlement and administration costs of claims incurred. We use actuarial and computer models, historical insurance and reinsurance industry loss statistics, and management’s experience and judgment to assist in the establishment of appropriate claims and claim expense reserves. Reserves are estimates of claims an insurer or reinsurer ultimately expects to pay, based upon facts and circumstances known at the time, predictions of future events, estimates of future trends in claim severity, and other variable factors. The inherent uncertainties of estimating loss reserves generally are greater for reinsurance and MGA-produced insurance businesses as compared to traditional primary insurance, primarily due to:
Previous wording
Our estimates and judgments are based on numerous factors and may be revised as additional experience and other data become available and are reviewed, as new or improved methodologies are developed, as loss trends and claims inflation impact future payments, or as current laws or interpretations thereof change. Due to the many assumptions and estimates involved in establishing reserves and the inherent uncertainty of modeling techniques, the reserving process is inherently uncertain. It is expected that some of our assumptions or estimates will prove to be inaccurate, and that our actual net claims and claim expenses paid and reported will differ, perhaps materially, from the reserve estimates reflected in our financial statements. For example, our significant gross and net reserves associated with the large catastrophe events in the past several years remain subject to significant uncertainty. As information emerges and losses are paid, we expect our reserves may change, perhaps materially.
Current wording
Our estimates and judgments are based on numerous factors and may be revised as additional experience and other data become available and are reviewed, as new or improved methodologies are developed, as loss trends and claims inflation evolve, or as applicable laws or interpretations change. Because establishing reserves involves many assumptions and estimates, and because modeling techniques involve inherent uncertainty, the reserving process is itself inherently uncertain. As a result, some of our assumptions or estimates may inevitably prove to be inaccurate, and our actual net claims and claim expenses paid and reported may differ, possibly materially, from the reserves reflected in our financial statements. For example, our significant gross and net reserves associated with large catastrophe events in the recent years remain subject to meaningful uncertainty, and as information emerges and claims develop, we expect our reserves may change, perhaps materially.
Previous wording
Accordingly, we may underestimate the exposures we are assuming and our results of operations and financial condition may be adversely impacted, perhaps significantly. Conversely, we may prove to be too conservative which could contribute to factors which would impede our ability to grow in respect of new markets or perils or in connection with our current portfolio of coverages.
Current wording
Accordingly, we may underestimate the exposures we are assuming and our results of operations and financial condition may be adversely impacted, perhaps significantly. Conversely, we may prove to be too conservative, which could contribute to factors which could hinder our ability to grow in new markets or perils or in connection with our current portfolio of coverages.
Previous wording
We write reinsurance contracts and insurance policies that cover unpredictable catastrophic events. Covered unpredictable catastrophic events, predominantly in our insurance and reinsurance property lines of business, include natural perils and other disasters, such as hurricanes, windstorms, earthquakes, floods, wildfires and severe winter weather. Catastrophes can also include terrorist attacks, explosions, infrastructure failures and pandemics similar to the COVID-19 pandemic. We have significant exposure to a potential major earthquake or series of earthquakes in various geographic regions, including in
Current wording
We write reinsurance contracts and insurance policies that cover unpredictable catastrophic events. Covered unpredictable catastrophic events, predominantly in our insurance and reinsurance property lines of business, include natural perils, extreme weather events, and other disasters, such as hurricanes, windstorms, earthquakes, floods, wildfires, heat waves, and severe winter weather. Catastrophes can also include terrorist attacks, explosions, infrastructure failures, epidemics, pandemics, financial crises and impacts of geopolitical uncertainty. We have significant exposure to a potential major earthquake or series of earthquakes in various geographic regions, including in California, the Midwestern United States, Canada, and Latin America. We also have significant exposure to windstorm and flood damage in various geographic regions, including Northern Europe and the United States. While we have taken steps to reduce our exposure to catastrophe risks, these risks may still affect our results of operations and financial condition.
Previous wording
Similar exposures to losses caused by the same types of catastrophic events occur in other lines of business such as aviation, casualty, contingency, credit, marine, and accident and health (including trip cancellation), including pandemic risk.
Current wording
Similar exposures to losses caused by the same types of catastrophic events occur in other lines of business such as aviation, casualty, contingency, credit, marine, and accident and health (including travel insurance), including pandemic risk.
Previous wording
The extent of catastrophe losses is a function of both the severity of the event and total amount of insured exposure affected by the event. Increases in the value and concentration of insured property or insured individuals, the effects of inflation, changes in weather patterns, such as climate change, and increased terrorism could increase the future frequency and/or severity of claims from catastrophic events. Claims from catastrophic events could materially adversely affect our results of operations and financial condition. Our ability to write new reinsurance contracts and insurance policies could also be impacted as a result of corresponding reductions in our capital levels. For a further discussion, see “Risks Relating to our Business—Global climate change may have a material adverse effect on our business, operating results and financial condition.”
Current wording
The extent of catastrophe losses is a function of the frequency, severity, and development of the insured exposure. Increases in the value and concentration of insured property or insured policyholders, the effects of inflation, changes in weather patterns, such as climate change, and increased terrorism could increase the future frequency and/or severity of claims from catastrophic events. Claims from catastrophic events could materially adversely affect our results of operations and financial condition. Our ability to write new reinsurance contracts and insurance policies could also be impacted as a result of corresponding reductions in our capital levels.
Previous wording
Although we attempt to manage our exposure to such events through a multitude of approaches, including geographic diversification, geographic limits, individual policy limits, exclusions or limitations from coverage, purchase of insurance and reinsurance, the availability of these management tools may be dependent on market factors and, to the extent available, may not respond in the way that is expected. For instance, we seek to manage our exposure to catastrophe losses by limiting the aggregate insured value of policies in geographic areas with exposure to catastrophic events by estimating PML for many different catastrophe scenarios and by buying reinsurance, including retrocession coverage. To manage and analyze aggregate insured values and PML, we use a variety of tools, including external and internal catastrophe modeling software packages. Estimates of PMLs are dependent on many variables, including assumptions about demand surge and storm surge, loss adjustment expenses, insurance-to-value for the underlying properties, the relationship of the actual event parameters to the modelled event and the quality of portfolio data provided to us by ceding companies (in the case of our reinsurance operations). Accordingly, if these assumptions about the variables are incorrect, the losses we might incur from an actual catastrophe could be materially higher than our expectation of losses generated from modelled catastrophe scenarios which could materially adversely affect our financial condition, liquidity or results of operations.
Current wording
Although we attempt to manage our exposure to catastrophic events through a variety of approaches -- including geographic diversification, geographic limits, individual policy limits, exclusions, or limitations from coverage, and the purchase of insurance and reinsurance -- the availability and effectiveness of these tools may depend on market conditions and, even when available, may not perform as anticipated. For example, we manage our exposure to catastrophe losses by limiting aggregate insured values in geographic areas prone to catastrophic events, estimating PML for multiple catastrophe scenarios, and purchasing reinsurance, including retrocession coverage. To evaluate aggregate insured values and PML, we use a range of tools, including external and internal catastrophe modeling software. Estimates of PMLs depend on numerous variables, including assumptions about demand surge and storm surge, loss adjustment expenses, insurance-to-value for the underlying properties, how actual event parameters compare to modeled events, and the quality of portfolio data provided by ceding companies in our reinsurance operations. If any of these assumptions prove incorrect, the losses we might incur from an actual catastrophe could be materially higher than the modeled losses we expected, which could materially adversely affect our financial condition, liquidity, or results of operations.
Previous wording
Given the reinsurance retention limits imposed under TRIA (as defined below) and its subsequent legislative extensions, and that some or many of our policies may not include a terrorism exclusion, future foreign or domestic terrorist attacks may result in losses that have a material adverse effect on our business, results of operations and/or financial condition.
Current wording
Given the reinsurance retention limits imposed under the U.S. Terrorism Risk Insurance Act of 2002, as extended through December 31, 2027 (“TRIA”), and the fact that some of our policies may not include a terrorism exclusion, foreign or domestic terrorist attacks may result in losses that have a material adverse effect on our business, results of operations, or financial condition.
Previous wording
Under the Terrorism Risk Insurance Act of 2002 (“TRIA”), which was subsequently extended through December 31, 2027, commercial insurers are required to offer insurance coverage against terrorist incidents and are reimbursed by the federal government under the Terrorism Risk Insurance Program (“TRIP”) for paid claims, subject to deductible and retention amounts. TRIA, and its related rules, contain certain definitions, requirements and procedures for insurers filing claims with the Treasury for payment of the federal share of compensation for insured losses under TRIP. TRIA also contains specific provisions designed to manage litigation arising out of, or resulting from, a certified act of terrorism. The Claims Procedures Rule enacted under TRIA specifically addresses requirements for federal payment, submission of an initial notice of insured loss, loss certifications, timing and process for payment, associated recordkeeping requirements, as well as the Treasury’s audit and investigation authority. These procedures will apply to all insurers that wish to receive their payment of the federal share of compensation for insured losses under TRIA.
Current wording
Under TRIA, commercial insurers are required to offer insurance coverage against terrorist incidents and are reimbursed by the federal government under the Terrorism Risk Insurance Program (“TRIP”) for paid claims, subject to deductible and retention amounts. TRIA, and its related rules, contain certain definitions, requirements, and procedures for insurers filing claims with the Treasury for payment of the federal share of compensation for insured losses under TRIP. TRIA also contains specific provisions designed to manage litigation arising out of, or resulting from, a certified act of terrorism. The Claims Procedures Rule enacted under TRIA specifically addresses requirements for federal payment, submission of an initial notice of insured loss, loss certifications, timing and process for payment, associated recordkeeping requirements, as well as the Treasury’s audit and investigation authority. These procedures apply to all insurers that wish to receive their payment of the federal share of compensation for insured losses under TRIA.
Previous wording
We have material exposures arising from our coverages for natural disasters and catastrophes. Changes in climate conditions have resulted in increased severity and frequency of weather-related natural disasters and catastrophes. For example, during the year ended December 31, 2024, the industry experienced several significant severe weather events. In addition, rising sea levels are expected to add to the risks associated with coastal flooding in many geographical areas. We believe that these changes in climate conditions, when coupled with projected demographic trends in catastrophe-exposed regions, have increased the average economic value of expected losses, increased the number of people exposed per year to natural disasters and in general have exacerbated disaster risk, including risks to infrastructure, global supply chains and agricultural production. This could lead to higher overall losses that we may not be able to recoup, particularly in the current economic and competitive environment, and in light of higher insurance and reinsurance costs. Over the long-term, global climate change could impair our ability to predict the costs associated with future weather events and could also give rise to new environmental liability claims in the energy, manufacturing and other industries we serve.
Current wording
We have material exposures arising from our coverages for natural disasters and catastrophes. Changes in climate conditions have resulted in increased severity and frequency of weather-related natural disasters and catastrophes. For example, during the year ended December 31, 2025, the industry experienced several significant severe weather events. In addition, rising sea levels are expected to add to the risks associated with coastal flooding in many geographical areas. We believe that these changes in climate conditions, when coupled with projected demographic trends in catastrophe-exposed regions, have increased the average economic value of expected losses, increased the number of people exposed per year to natural disasters, and have generally exacerbated disaster risk, including risks to infrastructure, global supply chains, and agricultural production. This could lead to higher overall losses that we may not be able to recoup, especially in light of current economic conditions, competitive pressures, and rising insurance and reinsurance costs. Over the long-term, global climate change could impair our ability to accurately predict the costs associated with future weather events and may also lead to new environmental liability claims in the energy, manufacturing, and other industries we serve.
Previous wording
A substantial portion of our coverages may be adversely impacted by climate change, and we cannot assure you that our risk assessments and models accurately reflect environmental and climate related risks. Given the scientific uncertainty of predicting the effect of climate cycles and global climate change on the frequency and severity of natural catastrophes and the resulting lack of adequate predictive tools, we may be unable to adequately model the associated exposures and potential losses in connection with such catastrophes, which could have a material adverse effect on our business, operating results and financial condition. The frequency and severity of weather-related natural disasters and catastrophes and potential connections to climate change are currently being analyzed by the insurance industry.
Current wording
A substantial portion of our coverages may be adversely impacted by climate change, and our risk assessments and models may not fully reflect environmental or climate-related risks. Scientific uncertainty regarding how climate cycles and global climate change influence the frequency and severity of natural catastrophes, combined with limitations in current predictive tools, may prevent us from accurately modeling associated exposures and losses As a result, our business, operating results, and financial condition could be materially adversely affected. The insurance industry continues to study the evolving relationship between climate change and weather-related natural disasters.
Previous wording
We write insurance and reinsurance policies covering casualty risks. Casualty insurance generally covers the financial consequences of the legal liability of an individual or organization resulting from negligent acts causing bodily injury and/or property damage to a third party. Claims from such business can take years to develop and settle and can be subject to unanticipated claims and economic and social inflation. In addition, we could be adversely affected by proposals or enacted legislation to expand the scope of coverage under existing policies or extend the statute of limitations for certain casualty risks. For example, state legislatures across the U.S. are enacting reforms for claims of past childhood sexual abuse that previously were barred by statutes of limitations, resulting in the revival of old claims. These legislative developments may greatly expand the universe of claimants for which we may be liable. Accordingly, if our pricing and/or reserving assumptions are incorrect, higher than expected losses could materially adversely affect our financial condition, liquidity or results of operations.
Current wording
We write insurance and reinsurance policies covering casualty risks, which generally relate to the legal liability of individuals or organizations for bodily injury or property damage caused to third parties. Claims arising from these risks can take many years to emerge, develop, and ultimately settle, and are susceptible to unanticipated claim patterns, as well as economic and social inflation. In addition, legislative or regulatory actions — such as efforts to expand the scope of coverage under existing policies or extend statutes of limitations — could materially increase our exposure. For example, several U.S. states have enacted laws reviving otherwise time-barred claims relating to past childhood sexual abuse, significantly expanding the population of potential claimants to whom we may be liable. If our pricing or reserving assumptions prove incorrect, higher than expected losses from these or other casualty risks could materially adversely affect our financial condition, liquidity, or results of operations.
Previous wording
Recent or future U.S. federal or state legislation may impact the private markets and decrease the demand for our property insurance and reinsurance products, which would adversely affect our business and results of operations.
Current wording
Recent or future U.S. federal or state legislation may impact the private catastrophe risk markets and reduce the demand for our property insurance and reinsurance products.
Previous wording
We are reliant on financial strength and credit ratings, and any downgrade or withdrawal of ratings and/or change in outlook may have a material adverse effect on our business, prospects, financial condition and results from operations.
Current wording
We are reliant on financial strength and credit ratings, and any downgrade, withdrawal of ratings, or change in outlook may have a material adverse effect on our business, prospects, financial condition and results from operations.
Previous wording
The maintenance of an "A-" or better financial strength rating from AM Best and/or S&P of “A3” or better financial strength rating from Moody’s is particularly important to our operating insurance and reinsurance subsidiaries to bind property and casualty insurance and reinsurance business in most markets. In addition, issuer credit ratings are used by existing or potential investors to assess the likelihood of repayment on a particular debt issue. Accordingly, the maintenance of an investment grade credit rating (e.g., "BBB-" or better from S&P or Fitch) is important to our ability to raise new debt with acceptable terms. Strong credit ratings are important factors that provide better financial flexibility when issuing new debt or restructuring existing debt. A downgrade, withdrawal or similar action concerning our credit ratings could limit our ability to raise new debt or could make new debt more costly and/or result in more restrictive conditions.
Current wording
The maintenance of an "A-" or better financial strength rating from AM Best and/or an “A3” or better financial strength rating from Moody’s is particularly important to our operating insurance and reinsurance subsidiaries in order to bind property and casualty insurance and reinsurance business in most markets. In addition, issuer credit ratings are used by existing or potential investors to assess the likelihood of repayment on a particular debt issue. Similarly, maintaining investment grade credit rating (e.g., "BBB-" or better from S&P or Fitch) is important to our ability to access the capital markets on acceptable terms. Strong credit ratings support our financial flexibility and allow us to raise or refinance debt at more favorable interest rates and covenant terms. A downgrade, withdrawal or adverse outlook change with respect to any of our credit ratings could limit our ability to access capital, increase our borrowing costs, reduce the attractiveness of our securities to investors, or result in more restrictive terms on future financing arrangements.
Previous wording
Rating agencies periodically evaluate us and our operating insurance and reinsurance companies to confirm that we continue to meet the criteria of the ratings previously assigned to us. A downgrade or withdrawal of the financial strength rating of our operating insurance and reinsurance companies could severely limit or prevent us from writing new policies or renewing existing policies, which could have a material adverse effect on our results of operations and financial condition. Additionally, some of our assumed reinsurance contracts contain optional cancellation, commutation and/or funding provisions that would be triggered if AM Best and/or S&P were to downgrade our rating below "A-" or withdraw the financial strength ratings of our principal insurance and reinsurance operating subsidiaries. A downgrade may also require us to establish trusts or post letters of credit for ceding company clients. A client may choose to exercise these rights depending on, among other things, the reasons for such a downgrade, the extent of the downgrade, the prevailing market conditions, the degree of unexpired coverage, and the pricing and availability of replacement reinsurance coverage. We cannot predict in advance how many of our clients would exercise such rights in the event of a downgrade or withdrawal, but widespread exercise of these options could be materially adverse.
Current wording
Rating agencies periodically review our company and our operating insurance and reinsurance subsidiaries to determine whether we continue to meet the criteria associated with our current ratings. A downgrade or withdrawal of a financial strength rating could significantly impair our ability to write new policies or renew existing policies, adversely affect broker and client confidence, and result in the loss of business opportunities. Additionally, certain of our assumed reinsurance contracts contain optional cancellation, commutation and/or funding provisions that may be triggered if AM Best and/or S&P downgrades our rating below "A-" or withdraws the ratings altogether. Depending on the nature of the downgrade and prevailing market conditions, cedents could exercise their rights under these provisions, require us to post collateral (such as letters of credit or trust funds), or seek alternative reinsurance arrangements. We cannot predict in advance how many clients would exercise these rights following a downgrade or withdrawal. However, widespread exercise of such rights could have a material adverse effect on our liquidity, financial condition, results of operations, and future business prospects.
Previous wording
Our foreign operations are also subject to legal, political and operational risks that may be greater than those present in the U.S. As a result, our operations at these foreign locations could be temporarily or permanently disrupted.
Current wording
Our foreign operations are also subject to legal, political and operational risks that may be greater than those present in the U.S. As a result, our operations at these foreign locations could be temporarily or permanently disrupted. Our foreign operations are also subject to legal, political and operational risks that may be greater than those present in the U.S., and our operations in these foreign locations could be temporarily or permanently disrupted.
Previous wording
If we do not successfully manage transitions associated with key management changes, it may be viewed negatively by our rating agencies and shareholders and could have an adverse impact on our business.
Current wording
If we do not successfully manage transitions associated with key management changes, our business, reputation and ratings could be adversely affected.
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Current report — wording carried from elsewhere
Since 2017, the member countries of the G20/OECD Inclusive Framework on BEPS have developed a two-pillar approach to address the tax challenges arising from the digitalization of the economy. “Pillar One” addresses nexus and profit allocation challenges, while “Pillar Two” addresses perceived base erosion. Pillar One includes exclusions for Regulated Financial
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
SiriusPoint’s insurance and reinsurance subsidiaries’ ability to pay dividends and other distributions to SiriusPoint, and losses from unfavorable outcomes from litigation and other legal proceedings.
Previous report — wording carried elsewhere
California, the Midwestern United States, Canada, and Latin America. We also have significant exposure to windstorm and flood damage in various geographic regions, including Northern Europe and the United States. While we have taken steps to reduce our exposure to catastrophe risks, these risks may still affect our results of operations and financial condition. For more information about our risks due to terrorist attacks, see“Risks Relating to Our Business—We have exposure to potential terrorist acts that can materially and adversely affect our business, results of operations and/or financial condition.”
Previous report — wording carried elsewhere
•any future sales of our common shares or other securities; and