SiriusPoint LtdSPNT
SiriusPoint Ltd Commitments Disclosure
21. Commitments and contingencies
Concentrations of credit risk
The Company has exposure to credit risk as it relates to its business written through brokers, if any of the Company’s brokers are unable to fulfill their contractual obligations with respect to payments to the Company. In addition, in some jurisdictions, if the broker fails to make payments to the insured under the Company’s policy, the Company may remain liable to the insured for the deficiency. These brokers are fairly large and well established, and there are no indications they are financially distressed. The Company’s exposure to such credit risk is somewhat mitigated in certain jurisdictions by contractual terms.
For the years ended December 31, 2025 and December 31, 2024, no individual source accounted for more than 10% of gross written premium. For the year ended December 31, 2023, Guy Carpenter & Company accounted for 12.1% of gross written premium. No other source individually contributed more than 10% of total gross written premium in any of the last three years.
The Company is exposed to credit risk through reinsurance contracts with companies that write credit risk insurance. The Company’s portfolio of risk is predominantly U.S. mortgage insurance and mortgage credit risk transfer. The Company provides its clients in these lines of business with reinsurance protection against credit deterioration, defaults or other types of financial non-performance. The Company proactively manages the risks associated with these credit-sensitive lines of business by closely monitoring its risk aggregation and by diversifying the underlying risks where possible. The Company has bought some retrocessional coverage against a subset of these risks.
The Company has exposure to credit risk related to balances receivable under our reinsurance contracts, including funds withheld and premiums receivable, and the possibility that counterparties may default on their obligations to the Company. The risk of counterparty default is partially mitigated by the fact that any amount owed from a reinsurance counterparty
would be netted against any losses or acquisition costs the Company would pay in the future. The Company monitors the collectability of these balances on a regular basis.
Litigation
From time to time in the normal course of business, the Company may be involved in formal and informal dispute resolution processes, which may include arbitration or litigation, the outcomes of which determine the rights and obligations under the Company’s insurance and reinsurance contracts and other contractual agreements. In some disputes, the Company may seek to enforce its rights under an agreement or to collect funds owed to it. In other matters, the Company may resist attempts by others to collect funds or enforce alleged rights. The Company may also be involved, from time to time in the normal course of business, in formal and informal dispute resolution processes that do not arise from, or are not directly related to, claims activity. The Company believes that no individual litigation or arbitration to which it is presently a party is likely to have a material adverse effect on its results of operations, financial condition, business or operations.
Leases
The Company operates globally and leases office space under various non-cancelable operating lease agreements.
During the year ended December 31, 2025, the Company recognized operating lease expense of $10.3 million (2024 - $10.4 million and 2023 - $10.3 million), including property taxes and routine maintenance expense as well as rental expenses related to short term leases.
The following table presents the lease balances within the consolidated balance sheets as of December 31, 2025 and 2024:
| December 31, 2025 | December 31, 2024 | ||||||||||
Operating lease right-of-use assets(1) | $ | 20.7 | $ | 22.8 | |||||||
Operating lease liabilities(2) | $ | 24.6 | $ | 24.5 | |||||||
| Weighted average lease term (years) | 4.6 | 5.2 | |||||||||
| Weighted average discount rate | 3.2 | % | 3.0 | % | |||||||
(1) are included in Other assets on the Company’s consolidated balance sheets.
(2) Operating lease liabilities are included in on the Company’s consolidated balance sheets.
Future minimum rental commitments as of December 31, 2025 under these leases are expected to be as follows:
| Future Payments | |||||
| 2026 | $ | 6.1 | |||
| 2027 | 5.3 | ||||
| 2028 | 5.6 | ||||
| 2029 | 4.6 | ||||
| 2030 and thereafter | 3.0 | ||||
| Total lease liability as of December 31, 2025 | $ | 24.6 | |||
Liability-classified capital instruments
On February 26, 2021, the Company completed its acquisition of Sirius International Insurance Group, Ltd. (“Sirius Group”). The aggregate consideration for the transaction included the issuance of preference shares, warrants, and other contingent value components, which, when outstanding, were previously recorded at fair value in Liability-classified capital instruments on the consolidated balance sheets. As of December 31, 2024, all of the instruments were settled, exercised or expired.
Series A Preference Shares
On February 26, 2021, certain holders of Sirius Group shares elected to receive Series A preference shares, par value $0.10 per share (“Series A Preference Shares”), with respect to the consideration price of the Sirius Group acquisition. The Company issued 11,720,987 Series A Preference Shares.
Pursuant to the CMIG Series A and Repurchase Agreement, the Company settled all Series A Preference Shares held by CM Bermuda during the third quarter of 2024, which resulted in a loss of $90.7 million and is recorded in Loss on settlement and change in fair value of liability classified instruments in the Company’s consolidated income statement during the year ended December 31, 2024. For further details on the CMIG Series A and Repurchase Agreement, see Note 3 “Significant transactions”.
During the year ended December 31, 2023, the Company recorded a loss of $35.8 million from the change in fair value of the Series A Preference Shares.
Merger Warrants
On February 26, 2021, the Company issued certain warrants with respect to the consideration price of the Sirius Group acquisition (the “Merger Warrants”).
Pursuant to the CMIG Securities Purchase Agreement, the Company settled all Merger Warrants held by CM Bermuda during the fourth quarter of 2024, which resulted in a loss of $25.9 million and is recorded in Loss on settlement and change in fair value of liability classified instruments in the Company’s consolidated income statement during the year ended December 31, 2024. For further details on the CMIG Securities Purchase Agreement, see Note 3 “Significant transactions”.
During the year ended December 31, 2023, the Company recorded a loss of $15.0 million from the change in fair value of the Merger Warrants.
Sirius Group Private Warrants
On February 26, 2021, the Company entered into an assumption agreement pursuant to which the Company agreed to assume all of the warrants issued on November 5, 2018 and November 28, 2018 (the “Private Warrants”) by Sirius Group to certain counterparties. The 5,418,434 Private Warrants were all exercised before their maturity on November 5, 2023.
Sirius Group Public Warrants
Under the merger agreement between Sirius Group and Easterly Acquisition Corporation (“Easterly”), each of Easterly’s existing issued and outstanding public warrants was converted into a warrant exercisable for Sirius Group common shares (“Sirius Group Public Warrants”). The Sirius Group Public Warrants expired without exercise on October 27, 2023.
Contingent Value Rights
On February 26, 2021, the Company entered into a contingent value rights agreement with respect to the consideration price of the Sirius Group acquisition. The contingent value rights (“CVRs”) became publicly traded on the OTCQX Best Market during the quarter ended June 30, 2021. The CVRs matured on February 26, 2023 and were settled for $38.5 million.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 24, 2026 | Showing above |
| 2024 | Feb 21, 2025 | |
| 2023 | Feb 29, 2024 | |
| 2022 | Feb 24, 2023 | |
| 2021 | Mar 1, 2022 | |
About Commitments Disclosures
Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.
Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.