Everest Group has added another $253 million in net adverse casualty reserve development in the third quarter of 2026, its third successive quarter of significant reserve additions to its US liability book. That pattern has now accumulated well over $1 billion in strengthening since the $1.7 billion charge that rocked the company at the end of 2024.
The Bermuda-headquartered reinsurer and specialty insurer posted net income of $233 million for the quarter, down from $255 million in Q3 2025, with a group combined ratio of 107.1%, which included $268 million in net unfavorable reserve development across total reportable segments, adding 8.5 points to that ratio. Pre-tax catastrophe losses of $322 million added 10.5 points to that ratio, driven by the Colombia earthquake, events in the Middle East, and a series of weather-related losses globally. Strip those out alongside the reserve charges and the attritional picture looks considerably more stable, with Everest’s attritional combined ratio for its core businesses coming in at 87.0%, broadly flat against a year ago.
But the casualty reserve line is where the pressure lies.
The $253 million in net adverse development in Q3 2026 included gross casualty reserve strengthening of approximately $600 million before reinsurance recoveries, concentrated in the reinsurance treaty segment. That follows more than $200 million of reinsurance casualty strengthening in Q2 2026, and the $1.7 billion charge taken across both the reinsurance and insurance divisions at year-end 2024.
Running in parallel, Everest has reduced its casualty XOL premium by 24.8% and its casualty pro-rata premium by 15.8% year-on-year in Q3 2026 alone. Since January 2024, the company has cut casualty premium by more than $1.2 billion in total, according to earlier management commentary.
The combination of repeated reserve additions on the existing book while simultaneously shrinking new casualty writings reflects a reinsurer still working through the consequences of what Jim Williamson, Everest’s president and chief executive, previously described as a “high concentration in casualty” compounded by social inflation. Everest attributed its original reserve charge in 2024 to “a combination of social inflation and portfolio concentrations in certain US casualty line classes,” and the additions in subsequent quarters suggest that work is not finished.
The adverse development cover (ADC) Everest put in place in October 2025, providing $1.2 billion of protection on prior-year North American liabilities in the global wholesale and specialty (GW&S) and legacy segments, limits further downside from the insurance book. The reinsurance treaty segment, however, sits outside that cover, and it is where the Q3 2026 additions are concentrated.
The quarter was not uniformly negative. Everest’s global wholesale and specialty segment, its direct-access, broker-facing business, grew gross written premium by 3.2% on a comparable basis, with financial lines up 27.5%, specialty up 21.5%, and casualty up 19.7%. That last figure is a notable contrast to the reinsurance treaty book, where casualty is being cut, and reflects Everest’s preference for direct-access business where it can exercise tighter control over terms and conditions.
The segment’s attritional combined ratio of 93.7% held roughly steady. Net investment income reached $634 million for the quarter, up from $540 million a year earlier, giving the group a meaningful earnings buffer against underwriting losses.
Everest also spent $474 million repurchasing its own shares in Q3 2026, bringing the year-to-date buyback total to $1.2 billion. That accelerated pace of capital return, against a backdrop of shrinking casualty premium, reflects a deliberate choice to deploy capital away from a line that has proved consistently more expensive than priced.
Casualty reinsurance has faced mounting pressure from social inflation, which refers to rising claims costs driven by increased litigation, larger jury awards, and expanded policy interpretations. Reinsurers across the market have responded by strengthening reserves to address higher-than-expected loss costs.
Everest is among the more prominent to have disclosed the scale of that problem, but it is not alone. Casualty reinsurance conditions remain influenced by social inflation and reserving risk, particularly in the US, with some insurers taking reserve strengthening actions and portfolio adjustments to manage exposures, according to a Morningstar DBRS report in 2026.
The consequence for casualty reinsurance buyers is a market where major capacity providers are actively reducing their exposure to the lines most affected by litigation costs. Everest’s reinsurance treaty segment cut casualty XOL premium by nearly a quarter in a single quarter. That kind of withdrawal, repeated across multiple carriers, tightens available capacity for cedants placing US casualty programs, whether general liability, excess casualty, or professional lines, and puts upward pressure on pricing at upcoming renewals.
Everest’s 2024 reserve charge and the sequence of additions that followed have been covered in detail elsewhere. What Q3 2026 confirms is that the challenge of long-tail casualty business driven by social inflation and post-pandemic claims uncertainty has not been resolved by the remediation steps taken since.
At the Q2 2026 earnings call in August, Williamson said Everest expected “market conditions to remain competitive” at the January 1, 2027 renewal “absent large cat losses or other external shocks.” That signals that the company is not anticipating meaningful pricing relief in casualty reinsurance as it heads into the next major renewal cycle.
