Bermudian-based Enstar Group Limited has reported a third-quarter net loss of $444 million.

That compares with a net loss of $196 million for the three months ended September 30, 2021.

The company has reported a net loss of $1.2 billion for the first nine months of the year, compared with net earnings of $365 million for the nine months ended September 30, 2021.

Return on equity was minus 10.6 per cent and adjusted ROE was minus 2.9 per cent for the quarter compared with minus 2.9 per cent and minus 2.8 per cent, respectively, in the third quarter a year ago.

Enstar said ROE was impacted by $395 million of net unrealised losses arising primarily from interest-rate increases on fixed-maturity portfolios that are classified as trading, combined with $151 million of net unrealised losses in Enstar's non-core portfolios.

The company said its group regulatory solvency, or economic balance sheet, strengthened during the third quarter due to the impact of a higher discount rate on its reserves and its core fixed-income securities being shorter in duration than its insurance liabilities.

Run-off liability earnings of $109 million, or 3.7 per cent, were driven by reductions in the value of certain portfolios that are held at fair value and favourable development on Enstar’s workers' compensation and marine, aviation and transit lines of business, partially offset by adverse development on its general casualty and motor lines of business.

Dominic Silvester, Enstar CEO, said: “The significant rise in interest rates to combat high inflation continues to drive unrealised bond losses in our investment portfolio. However, we expect our bond portfolio to recover these unrealised losses over time as these bonds will amortise back to par or full principal value as they reach maturity.”

He added: “Our balance sheet remains strong, and we have the capacity to meet market demand. We will continue to provide tailored solutions to our clients, drive positive claims outcomes and invest for the long term. We are confident that this focus will provide exceptional returns for our stakeholders.”