1025-00005 · Quorum Insurance Holdings · Pre-Litigation/Motions

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SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK — COMMERCIAL DIVISION

PINNACLE ATLANTIC REINSURANCE LTD.,

Plaintiff/Petitioner,

-against-

QUORUM CASUALTY & SURETY COMPANY,

Defendant/Respondent.

Index No.: __/2026 (to be assigned upon filing)

AFFIDAVIT OF TOBIAS ENGSTRÖM IN SUPPORT OF DEFENDANT'S MOTION TO COMPEL ARBITRATION AND STAY LITIGATION

STATE OF CONNECTICUT ) COUNTY OF HARTFORD ) ss.:

I, Tobias Engström, being duly sworn, depose and state as follows:

I am over eighteen (18) years of age, competent to testify, and make this affidavit based upon my personal knowledge and upon review of business records maintained by Quorum Insurance Holdings Corp. and its subsidiaries in the ordinary course of business. Unless otherwise indicated, the facts set forth herein are within my personal knowledge, and if called upon to testify, I could and would competently testify to the matters stated herein. This affidavit is submitted in support of the motion by Defendant/Respondent Quorum Casualty & Surety Company ("QC&S") to compel arbitration and stay litigation pursuant to Article 75 of the New York Civil Practice Law and Rules ("CPLR") and the Federal Arbitration Act, 9 U.S.C. §§ 1–16 (the "FAA").

Paragraph 1 — Background and Qualifications of Affiant

1. I currently hold the title of Senior Vice President, Reinsurance & Capital Markets, at Quorum Insurance Holdings Corp. ("QIH"), a Delaware corporation publicly traded on the Nasdaq Stock Market under the ticker symbol "QIHC," with its principal executive offices located at 200 Constitution Plaza, Suite 3400, Hartford, Connecticut 06103. I have served in this capacity at QIH since April 2014, a period of approximately twelve years.

2. In my role as Senior Vice President, Reinsurance & Capital Markets, I am responsible for the oversight, negotiation, placement, and administration of reinsurance programs maintained by QIH and its insurance company subsidiaries. My responsibilities include directing QIH's relationships with reinsurance counterparties, reinsurance intermediaries, and brokers, as well as overseeing the management and resolution of reinsurance recoverables and disputes arising under reinsurance treaties and facultative certificates placed on behalf of QIH's subsidiaries.

3. I have direct supervisory responsibility over the reinsurance program of QC&S, a New York-domiciled stock property and casualty insurance company assigned National Association of Insurance Commissioners ("NAIC") Number 24891. QC&S is QIH's principal insurance subsidiary and maintains its principal office at 200 Constitution Plaza, Suite 3200, Hartford, Connecticut 06103. QC&S is a wholly owned subsidiary of QIH.

4. Prior to joining QIH, I held positions in reinsurance underwriting and treaty management at Sterling Reach Corporation and at Glenrock Partners LLC. I hold a Master of Business Administration degree from the Wharton School of the University of Pennsylvania and a Bachelor of Science degree in Actuarial Science from the University of Connecticut. I am a Fellow of the Casualty Actuarial Society (FCAS) and a Chartered Property Casualty Underwriter (CPCU). I have over twenty-two years of experience in the reinsurance industry.

Paragraph 2 — Purpose of the Affidavit

5. I submit this affidavit to provide the Court with facts regarding the following matters:

(a) The negotiation and execution of Aggregate Excess-of-Loss Reinsurance Treaty No. PA-QCS-2019-EXL-0044 (the "Treaty") between QC&S, as cedent, and Pinnacle Atlantic Reinsurance Ltd. ("Pinnacle Atlantic" or "PARL"), a Bermuda Class 4 insurer registered with the Bermuda Monetary Authority under Registration Number BMA-4R-2008-0331;

(b) The parties' mutual intent that all disputes arising under or in connection with the Treaty be resolved through binding arbitration as set forth in Article 22 of the Treaty (the "Arbitration Clause");

(c) The role of Broadreach Intermediaries Inc. ("Broadreach"), a New York-licensed reinsurance intermediary, in the placement and administration of the Treaty; and

(d) The authentication of the Treaty and related documents attached hereto as Exhibits A through F.

6. I am the most knowledgeable person at QIH and QC&S regarding the negotiation, execution, and administration of the Treaty. I was the lead negotiator on behalf of QC&S during the placement of the Treaty and am a signatory to the Treaty.

Paragraph 3 — Description of Quorum Casualty & Surety Company

7. QC&S is a New York-domiciled stock property and casualty insurance company. QC&S is licensed to write insurance in all fifty states, the District of Columbia, and the U.S. Virgin Islands, and is assigned NAIC Number 24891. QC&S has been continuously licensed and actively writing insurance business in the State of New York since 1962.

8. As of the most recent available financial statements, QC&S's A.M. Ridgeway rating (2025) is A (Excellent), with a Stable outlook. QC&S's statutory surplus as reported in its Annual Statement filed with the New York State Department of Financial Services as of December 31, 2025 was approximately $1.42 billion.

9. QC&S principally writes commercial general liability, excess and umbrella liability, and professional liability (including errors and omissions and directors and officers) insurance policies, among other commercial lines of business. QC&S is a wholly owned subsidiary of QIH. For fiscal year 2025, QIH reported gross written premium of approximately $4.18 billion and net earned premium of approximately $2.93 billion, as disclosed in QIH's Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission.

Paragraph 4 — Description of Pinnacle Atlantic Reinsurance Ltd.

10. Pinnacle Atlantic Reinsurance Ltd. ("Pinnacle Atlantic" or "PARL") is a Bermuda-domiciled Class 4 insurer, registered with the Bermuda Monetary Authority under Registration Number BMA-4R-2008-0331. Pinnacle Atlantic maintains its registered office at Clarendon House, 14 Church Street, Hamilton HM 11, Bermuda, and maintains a United States office at 1285 Avenue of the Americas, 28th Floor, New York, New York 10019.

11. Pinnacle Atlantic is a subsidiary of Pinnacle Atlantic Group Holdings Ltd. ("PAGH"), a Bermuda exempted company. PAGH and its subsidiaries, including Pinnacle Atlantic, constitute a global reinsurance group specializing in casualty treaty and facultative reinsurance. For fiscal year 2025, Pinnacle Atlantic reported gross reinsurance assumed of approximately $9.6 billion. Pinnacle Atlantic's Chief Executive Officer is Sir Edmund Haverford.

12. Pinnacle Atlantic has, throughout its relationship with QC&S, maintained its U.S. office in New York, New York, and has regularly transacted reinsurance business within the State of New York.

Paragraph 5 — Description of Broadreach Intermediaries Inc.

13. Broadreach Intermediaries Inc. ("Broadreach") is a New York corporation and licensed reinsurance intermediary, with its principal office located at 100 Wall Street, 18th Floor, New York, New York 10005. Broadreach is licensed as a reinsurance intermediary in the State of New York and in numerous other jurisdictions throughout the United States.

14. The Account Executive at Broadreach responsible for the placement and ongoing administration of the Treaty is James "Jamie" Castellano. Mr. Castellano was the primary point of contact at Broadreach throughout the negotiation, placement, and administration of the Treaty.

15. Broadreach served as the intermediary broker for the placement and administration of the Treaty, as expressly designated under Article 9 of the Treaty (the "Intermediary Clause"). In its capacity as intermediary, Broadreach facilitated all premium payments and claims-settlement transmittals between QC&S and Pinnacle Atlantic. In accordance with standard industry practice and the terms of Article 9, all premium remittances by QC&S to Pinnacle Atlantic, and all reinsurance recovery payments by Pinnacle Atlantic to QC&S, were processed through Broadreach's fiduciary trust accounts.

16. Broadreach holds the original treaty slips, placement records, and certain correspondence relating to the negotiation and placement of the Treaty.

Paragraph 6 — Negotiation of the Treaty

17. In early 2019, QC&S undertook a comprehensive review of its reinsurance program for its commercial casualty lines of business, including commercial general liability, excess and umbrella liability, and professional liability. The purpose of the review was to evaluate the adequacy and pricing of QC&S's aggregate excess-of-loss protection, particularly in light of increasing loss activity in QC&S's professional liability and commercial general liability books of business.

18. As part of this review, I personally led the negotiations on behalf of QC&S for the placement of a new aggregate excess-of-loss reinsurance treaty to provide protection for QC&S's commercial casualty lines. I was the principal decision-maker at QC&S with respect to the structure, terms, and conditions of the treaty to be placed.

19. QC&S engaged Broadreach to act as its reinsurance intermediary for the placement of the Treaty. Jamie Castellano of Broadreach was designated as the lead Account Executive for this engagement. Through Broadreach, QC&S solicited proposals from a number of prospective reinsurers, including Pinnacle Atlantic.

20. Jamie Castellano of Broadreach facilitated communications with prospective reinsurers, including Pinnacle Atlantic, and circulated preliminary term sheets and draft treaty language among the parties. The negotiations between QC&S and Pinnacle Atlantic involved multiple rounds of term sheets, draft treaty language, and written comments exchanged between the parties through Broadreach.

21. In addition to communications exchanged through Broadreach, the negotiations involved a series of in-person meetings between QC&S personnel (including myself), Broadreach representatives (including Mr. Castellano), and Pinnacle Atlantic representatives. Among the Pinnacle Atlantic personnel with whom I personally negotiated was Conrad Hesse, who at that time served in an underwriting capacity at Pinnacle Atlantic and who currently holds the title of Senior Vice President, Treaty Disputes & Recoveries. Mr. Hesse was one of Pinnacle Atlantic's principal representatives during the negotiation of the Treaty's terms and conditions, including the arbitration provision.

22. The negotiations took place principally in New York, New York, including meetings held at Broadreach's offices at 100 Wall Street, at Pinnacle Atlantic's U.S. office at 1285 Avenue of the Americas, and at various other locations in the New York metropolitan area. The parties also exchanged drafts and comments via electronic mail and telephone throughout the negotiation period, which extended from approximately February 2019 through June 2019.

Paragraph 7 — Key Terms of the Treaty

23. The Treaty that resulted from the negotiations described above bears the designation Aggregate Excess-of-Loss Reinsurance Treaty No. PA-QCS-2019-EXL-0044. A true and complete copy of the Treaty, including all endorsements and amendments through the date of this affidavit, is attached hereto as Exhibit A. The key terms of the Treaty are as follows:

(a) Treaty Number: PA-QCS-2019-EXL-0044.

(b) Effective Date: July 1, 2019.

(d) Cedent: Quorum Casualty & Surety Company.

(e) Reinsurer: Pinnacle Atlantic Reinsurance Ltd.

(f) Original Treaty Term: Five (5) years, from July 1, 2019 through June 30, 2024, with automatic annual extensions unless either party provides ninety (90) days' prior written notice of non-renewal.

(g) Covered Lines of Business: Commercial general liability, excess and umbrella liability, and professional liability policies issued by QC&S.

(h) Retention per Treaty Year: $120,000,000 (one hundred twenty million dollars) in aggregate net incurred losses.

(i) Cession Limit per Treaty Year: $200,000,000 (two hundred million dollars) in aggregate net incurred losses in excess of the retention, covering losses from $120,000,000 to $320,000,000.

(j) Treaty Premium: Provisional rate of 42% of ceded earned premium, subject to a slide-scale adjustment based on loss experience, with a minimum rate of 35% and a maximum rate of 52%.

(k) Intermediary Clause: Article 9, designating Broadreach Intermediaries Inc. as the intermediary broker for the placement and administration of the Treaty.

(l) Governing Law: Article 16, providing that the Treaty shall be governed by and construed in accordance with the laws of the State of New York, without regard to its principles of conflicts of law.

(m) Arbitration: Article 22, providing for binding arbitration of all disputes arising under or in connection with the Treaty, conducted before a three-member arbitration panel seated in New York, New York, under the ARIAS-U.S. Rules.

24. I executed the Treaty on behalf of QC&S in my capacity as Senior Vice President, Reinsurance & Capital Markets, of QIH, acting as an authorized signatory of QC&S. The Treaty was countersigned on behalf of Pinnacle Atlantic by authorized representatives of that company.

Paragraph 8 — Treaty Extensions

25. The Treaty was originally set to expire on June 30, 2024. However, pursuant to the automatic renewal provision described in Paragraph 23(f) above, the Treaty has been extended beyond its original expiration date through two successive automatic one-year extensions.

26. The first automatic extension covered the period from July 1, 2024 through June 30, 2025. Neither party provided ninety (90) days' prior written notice of non-renewal in advance of the June 30, 2024 expiration date, and accordingly, the Treaty automatically extended for one additional year.

27. The second automatic extension covered the period from July 1, 2025 through June 30, 2026. Again, neither party provided timely notice of non-renewal in advance of the June 30, 2025 anniversary date, and accordingly, the Treaty automatically extended for a second additional year.

28. On October 1, 2025, Pinnacle Atlantic provided QC&S with written notice of non-renewal of the Treaty. A true and complete copy of the non-renewal notice is attached hereto as Exhibit E. Because the non-renewal notice was delivered more than ninety (90) days in advance of the June 30, 2026 expiration of the second extension period, the Treaty will lapse at the end of the second extension period on June 30, 2026. As of the date of this affidavit, the Treaty remains in force.

29. During the entire term of the Treaty, including both automatic extension periods, both parties performed their respective obligations under the Treaty. This includes, among other things, QC&S's timely payment of treaty premium and submission of loss reports and cession statements, and Pinnacle Atlantic's payment of reinsurance recoverables in respect of ceded losses. In particular, between October 15, 2022 and March 29, 2024, Pinnacle Atlantic paid a total of $78,400,000 (seventy-eight million four hundred thousand dollars) in reinsurance recoverables to QC&S across seven separate billing installments. These payments were processed through Broadreach in accordance with the Treaty's billing and settlement procedures. Representative billing transmittals evidencing these payments are attached hereto as Exhibit F.

Paragraph 9 — Negotiation and Intent of the Arbitration Clause (Article 22)

30. Article 22 of the Treaty (the "Arbitration Clause") provides for binding arbitration of all disputes arising under or in connection with the Treaty. A true and complete copy of Article 22, extracted from the Treaty for the Court's convenience, is attached hereto as Exhibit B.

31. Specifically, Article 22 provides that any dispute arising out of or relating to the formation, interpretation, performance, or breach of the Treaty, or any other matter arising under or in connection with the Treaty, shall be submitted to and resolved by a panel of three arbitrators, each of whom shall be a current or former officer of an insurance or reinsurance company, seated in New York, New York, and conducted in accordance with the ARIAS-U.S. Rules then in effect, as modified by the specific provisions of Article 22.

32. I was directly involved in the negotiation of Article 22. The arbitration provision was a subject of specific and detailed discussion between the negotiating teams of QC&S and Pinnacle Atlantic during the treaty negotiation process in the spring of 2019.

33. During the course of negotiations, both QC&S and Pinnacle Atlantic specifically discussed the scope of the arbitration provision, the selection and qualifications of arbitrators, the procedural rules to govern any arbitration, and the seat of arbitration. These discussions were conducted both in person and through written correspondence exchanged via Broadreach. At various stages of the negotiation, the parties exchanged redlined drafts of Article 22, reflecting proposed modifications and comments from each side.

34. Both parties understood and intended that Article 22 would serve as the exclusive mechanism for resolving any and all disputes arising under or relating to the Treaty. This includes, without limitation, disputes concerning the validity of cessions, loss allocation and reserve development, notice requirements, claim settlements and the follow-the-fortunes and follow-the-settlements doctrines, premium calculations and adjustments, and all other obligations arising under or in connection with the Treaty.

35. The arbitration clause was not a boilerplate or form provision inserted without deliberation. Rather, Article 22 was specifically negotiated and agreed upon by the parties as a material term of the Treaty. Both parties were represented by experienced reinsurance professionals who were fully aware of the implications and scope of the arbitration provision.

36. At no point during the negotiation of the Treaty did Pinnacle Atlantic propose, nor did any party agree, that certain categories of claims or disputes would be carved out from the scope of the arbitration clause. There was no discussion or suggestion by any party that disputes concerning late notice, loss allocation, follow-the-fortunes compliance, or premium reporting would be excluded from arbitration or subject to resolution through court litigation. To the contrary, the parties' intent was to ensure that all Treaty-related disputes would be resolved by arbitrators possessing specialized knowledge of the reinsurance industry.

37. The breadth of the arbitration language contained in Article 22 was intentional and reflects both parties' preference for the resolution of reinsurance disputes by a panel composed of individuals with reinsurance industry expertise. This preference is consistent with the longstanding custom and practice in the reinsurance industry, which strongly favors arbitration as the dispute resolution mechanism for treaty-based disputes. Both QC&S and Pinnacle Atlantic are sophisticated reinsurance market participants that routinely include arbitration clauses in their reinsurance treaties and that have extensive experience with reinsurance arbitration proceedings.

Paragraph 10 — Course of Dealing Between the Parties

38. QC&S and Pinnacle Atlantic have maintained a reinsurance relationship extending beyond the Treaty at issue in this proceeding. In addition to the Treaty, QC&S and Pinnacle Atlantic are parties to other reinsurance agreements and have an ongoing business relationship spanning multiple treaty years and multiple lines of business.

39. Throughout the Treaty's term, including both automatic extension periods, all disputes and questions regarding Treaty administration—including loss reports, billing statements, premium calculations, loss allocation, reserve development notifications, claims settlement practices, and treaty interpretation—were addressed between the parties, either directly or through Broadreach as intermediary, with the mutual understanding that any dispute that could not be resolved through informal discussions and negotiations would be submitted to binding arbitration under Article 22.

40. To the best of my knowledge and belief, no dispute between QC&S and Pinnacle Atlantic arising under the Treaty has previously been commenced by either party through court litigation. Throughout the entire term of the Treaty, the parties' course of dealing has consistently contemplated arbitration as the exclusive dispute resolution mechanism for Treaty-based disputes. This mutual understanding was reflected in the parties' conduct, their communications, and their consistent adherence to the terms and procedures set forth in the Treaty.

41. Pinnacle Atlantic's pre-suit demand letter dated February 14, 2026, transmitted by its counsel, Hargrove, Fitch & Calloway LLP ("HFC"), of 51 West 52nd Street, 40th Floor, New York, New York 10019, with lead partner Nathaniel R. Calloway III, is the first instance in which Pinnacle Atlantic or its counsel has asserted that Article 22 of the Treaty is inapplicable to any category of dispute arising under the Treaty. Prior to the February 14, 2026 demand letter, neither Pinnacle Atlantic nor any representative or counsel acting on its behalf ever suggested, orally or in writing, that the arbitration clause did not apply to any dispute under the Treaty, or that any particular category of dispute would be properly resolved through court litigation rather than arbitration.

Paragraph 11 — The Current Dispute Falls Within the Arbitration Clause

42. On December 12, 2025, Pinnacle Atlantic sent a reservation-of-rights letter to QC&S concerning the treaty year 2022 ("TY 2022") and treaty year 2023 ("TY 2023") cessions made by QC&S under the Treaty. A true and complete copy of this reservation-of-rights letter is attached hereto as Exhibit C. The reservation-of-rights letter raised general concerns regarding the cessions for those treaty years but did not assert that Article 22 was inapplicable or that Pinnacle Atlantic intended to pursue litigation rather than arbitration.

43. On February 14, 2026, Hargrove, Fitch & Calloway LLP, acting as counsel for Pinnacle Atlantic, sent a pre-suit demand letter to QC&S demanding the return of $78,400,000 (seventy-eight million four hundred thousand dollars) in previously paid reinsurance recoverables, plus $12,600,000 (twelve million six hundred thousand dollars) in accrued interest, for a total demand of $91,000,000 (ninety-one million dollars). A true and complete copy of this demand letter is attached hereto as Exhibit D.

44. The demand letter asserts four distinct grounds in support of Pinnacle Atlantic's claim:

(1) Late Notice Under Article 7: Pinnacle Atlantic alleges that QC&S provided untimely notice to Pinnacle Atlantic regarding the Meridian Docks mass tort claim cluster, in purported violation of the notice requirements set forth in Article 7 of the Treaty.

(2) Misallocation of IBNR Reserve Development Under Article 5: Pinnacle Atlantic alleges that QC&S improperly allocated approximately $22,300,000 (twenty-two million three hundred thousand dollars) in incurred but not reported ("IBNR") reserve development to the ceded loss account under Article 5 of the Treaty.

(3) Failure to Follow the Fortunes / Settlements Under Article 11: Pinnacle Atlantic alleges that QC&S failed to comply with the follow-the-fortunes and follow-the-settlements obligations set forth in Article 11 of the Treaty in connection with the settlement of the Veridian Financial Services errors and omissions ("E&O") claim cluster.

(4) Inaccurate Premium Reporting Under Article 3: Pinnacle Atlantic alleges that QC&S submitted inaccurate premium reports to Pinnacle Atlantic under Article 3 of the Treaty, resulting in an underpayment of treaty premium.

45. Each of these four grounds asserted in the demand letter directly arises under or relates to specific articles of the Treaty—namely, Articles 3, 5, 7, and 11. These claims concern the interpretation and application of the Treaty's provisions governing premium reporting, loss allocation and reserve development, notice requirements, and claim settlement practices—all matters that are at the core of the reinsurance relationship established by the Treaty.

46. These are quintessential Treaty-based disputes that fall squarely within the scope of Article 22's broad arbitration clause, which encompasses all disputes "arising out of or relating to the formation, interpretation, performance, or breach of this Treaty, or any other matter arising under or in connection with this Treaty." There is no colorable argument that the claims raised by Pinnacle Atlantic fall outside the scope of Article 22.

47. HFC's assertion in the February 14, 2026 demand letter that Article 22 is inapplicable to the claims at issue is wholly inconsistent with the plain language of Article 22, the intent of the parties as specifically negotiated and agreed upon during the placement of the Treaty, and the course of dealing between QC&S and Pinnacle Atlantic throughout the Treaty's term.

Paragraph 12 — Pinnacle Atlantic's Performance Under the Treaty Preceding the Dispute

48. As set forth above, between October 15, 2022 and March 29, 2024, Pinnacle Atlantic paid a total of $78,400,000 (seventy-eight million four hundred thousand dollars) in reinsurance recoverables to QC&S across seven separate billing installments. Each of these payments was made through the intermediary, Broadreach, in accordance with the Treaty's billing and settlement procedures as set forth in Articles 5 and 9 of the Treaty. Representative billing transmittals evidencing these payments are attached hereto as Exhibit F.

49. At the time of and prior to making each of these seven installment payments, Pinnacle Atlantic did not raise any objection to the validity or propriety of the cessions submitted by QC&S, the notice provided by QC&S regarding underlying claims (including the Meridian Docks mass tort cluster), the allocation of IBNR reserve development under Article 5, the settlement of the Veridian Financial Services E&O claim cluster, or the premium reporting submitted by QC&S under Article 3. Pinnacle Atlantic paid each billing installment in full and without reservation or qualification.

50. Pinnacle Atlantic's reservation-of-rights letter was not sent until December 12, 2025, more than twenty (20) months after the final billing installment payment of $9,200,000 was made on March 29, 2024. During the intervening period of more than twenty months, Pinnacle Atlantic did not communicate any concern, objection, or reservation regarding any aspect of QC&S's cessions, notices, loss allocations, premium reporting, or settlement practices under the Treaty.

51. Pinnacle Atlantic's prolonged silence, followed by a belated demand for the return of all reinsurance recoverables previously paid without objection, underscores the importance of resolving these Treaty-based disputes through the arbitration mechanism that both parties specifically negotiated and agreed upon. Arbitration before a panel of reinsurance industry professionals is the appropriate forum for the resolution of these complex reinsurance disputes, as both parties intended when they entered into the Treaty.

Paragraph 13 — Authentication of Treaty and Exhibits

52. The following documents are attached hereto as exhibits to this affidavit and are each authenticated as described below:

(a) Exhibit A: Attached hereto as Exhibit A is a true and complete copy of the Aggregate Excess-of-Loss Reinsurance Treaty No. PA-QCS-2019-EXL-0044, effective July 1, 2019, including all endorsements and amendments through the date of this affidavit. I am personally familiar with this document, as I was the lead negotiator on behalf of QC&S during the placement of the Treaty and am a signatory to the Treaty.

(b) Exhibit B: Attached hereto as Exhibit B is a true and complete copy of Article 22 of the Treaty (Arbitration), extracted from the Treaty for the Court's convenience. Exhibit B reproduces Article 22 in its entirety, without alteration or omission.

(c) Exhibit C: Attached hereto as Exhibit C is a true and complete copy of the reservation-of-rights letter from Pinnacle Atlantic to QC&S, dated December 12, 2025. This letter was received by QC&S at its offices in Hartford, Connecticut, and a copy was maintained in QC&S's and QIH's business records in the ordinary course of business.

(d) Exhibit D: Attached hereto as Exhibit D is a true and complete copy of the pre-suit demand letter from Hargrove, Fitch & Calloway LLP on behalf of Pinnacle Atlantic to QC&S, dated February 14, 2026. This letter was received by QC&S and forwarded to QC&S's outside counsel, Calderwood & Harkness LLP, and a copy was maintained in QC&S's and QIH's business records in the ordinary course of business.

(e) Exhibit E: Attached hereto as Exhibit E is a true and complete copy of the non-renewal notice from Pinnacle Atlantic to QC&S, dated October 1, 2025. This notice was received by QC&S at its offices in Hartford, Connecticut, and a copy was maintained in QC&S's and QIH's business records in the ordinary course of business.

(f) Exhibit F: Attached hereto as Exhibit F are representative billing transmittals evidencing the seven installment payments by Pinnacle Atlantic totaling $78,400,000 (seventy-eight million four hundred thousand dollars), covering the period from October 15, 2022 through March 29, 2024. Each of these billing transmittals was transmitted through Broadreach Intermediaries Inc. in accordance with Article 9 of the Treaty and was maintained in QC&S's and QIH's business records in the ordinary course of business.

53. I attest that each exhibit attached hereto is a true and correct copy of the original document as maintained in the records of QC&S and/or QIH. I have reviewed each document and confirmed its accuracy and completeness.

Paragraph 14 — Conclusion

54. For the foregoing reasons, I respectfully submit as follows:

(a) The Treaty contains a valid and enforceable arbitration clause in Article 22, which provides for binding arbitration of all disputes arising under or in connection with the Treaty before a three-member panel of arbitrators seated in New York, New York, and conducted under the ARIAS-U.S. Rules.

(b) The arbitration clause set forth in Article 22 was specifically negotiated and agreed upon by both QC&S and Pinnacle Atlantic as a material term of the Treaty. Both parties intended that Article 22 would serve as the exclusive mechanism for the resolution of all disputes arising under or in connection with the Treaty, without exception or carve-out.

(c) All four grounds raised in Pinnacle Atlantic's pre-suit demand letter dated February 14, 2026—namely, the alleged late notice under Article 7, the alleged misallocation of IBNR reserve development under Article 5, the alleged failure to follow the fortunes/settlements under Article 11, and the alleged inaccurate premium reporting under Article 3—constitute disputes arising under the Treaty and fall squarely within the scope of Article 22.

(d) The parties' course of dealing throughout the entire term of the Treaty, including both automatic extension periods, confirms the mutual understanding that disputes under the Treaty would be resolved through binding arbitration in accordance with Article 22. No dispute under the Treaty has ever been commenced through court litigation, and Pinnacle Atlantic never previously asserted that the arbitration clause was inapplicable.

(e) Pinnacle Atlantic should be compelled to arbitrate its claims against QC&S pursuant to Article 22 of the Treaty, under the ARIAS-U.S. Rules, before a three-member panel of arbitrators seated in New York, New York.

55. I respectfully request that the Court grant QC&S's motion to compel Pinnacle Atlantic to submit its claims to binding arbitration pursuant to Article 22 of the Treaty and to stay any and all litigation in this proceeding pending completion of the arbitration.

I declare under penalty of perjury under the laws of the State of Connecticut and the laws of the United States that the foregoing is true and correct.

________________________________________

Tobias Engström Senior Vice President, Reinsurance & Capital Markets Quorum Insurance Holdings Corp. 200 Constitution Plaza, Suite 3400 Hartford, CT 06103

Date: ___, 2026

NOTARY ACKNOWLEDGMENT

STATE OF CONNECTICUT ) COUNTY OF HARTFORD ) ss.:

Sworn to and subscribed before me this _ day of ___, 2026, by Tobias Engström, who is personally known to me or who produced satisfactory evidence of identification.

________________________________________

Notary Public, State of Connecticut My Commission Expires: _____

[Notary Stamp / Seal]

EXHIBIT LIST

The following exhibits are attached hereto and incorporated by reference into the foregoing Affidavit of Tobias Engström:

ATTORNEY CERTIFICATION / FILING BLOCK

Prepared by:

CALDERWOOD & HARKNESS LLP

By: ________

Jeffrey Park, Esq. One Liberty Plaza, 55th Floor New York, New York 10006 Telephone: (212) 558-4000 Facsimile: (212) 558-3588

Matter No. 1025-00005

Attorneys for Defendant/Respondent Quorum Casualty & Surety Company

Exhibit	Description
Exhibit A	Aggregate Excess-of-Loss Reinsurance Treaty No. PA-QCS-2019-EXL-0044, effective July 1, 2019 (complete with all endorsements and amendments through date of affidavit)
Exhibit B	Article 22 of the Treaty (Arbitration) — extracted for convenience of the Court
Exhibit C	Pinnacle Atlantic Reinsurance Ltd. Reservation-of-Rights Letter, dated December 12, 2025
Exhibit D	Pre-Suit Demand Letter from Hargrove, Fitch & Calloway LLP on behalf of Pinnacle Atlantic Reinsurance Ltd., dated February 14, 2026
Exhibit E	Pinnacle Atlantic Reinsurance Ltd. Non-Renewal Notice, dated October 1, 2025
Exhibit F	Representative Billing Transmittals — Seven Installment Payments totaling $78,400,000 (October 15, 2022 through March 29, 2024), transmitted through Broadreach Intermediaries Inc.

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK — COMMERCIAL DIVISION
PINNACLE ATLANTIC REINSURANCE LTD.,
Plaintiff/Petitioner,
-against-
QUORUM CASUALTY & SURETY COMPANY,
Defendant/Respondent.
Index No.: __/2026 (to be assigned upon filing)
AFFIDAVIT OF TOBIAS ENGSTRÖM IN SUPPORT OF DEFENDANT'S MOTION TO COMPEL ARBITRATION AND STAY LITIGATION
STATE OF CONNECTICUT ) COUNTY OF HARTFORD ) ss.:
I, Tobias Engström, being duly sworn, depose and state as follows:
I am over eighteen (18) years of age, competent to testify, and make this affidavit based upon my personal knowledge and upon review of business records maintained by Quorum Insurance Holdings Corp. and its subsidiaries in the ordinary course of business. Unless otherwise indicated, the facts set forth herein are within my personal knowledge, and if called upon to testify, I could and would competently testify to the matters stated herein. This affidavit is submitted in support of the motion by Defendant/Respondent Quorum Casualty & Surety Company ("QC&S") to compel arbitration and stay litigation pursuant to Article 75 of the New York Civil Practice Law and Rules ("CPLR") and the Federal Arbitration Act, 9 U.S.C. §§ 1–16 (the "FAA").
Paragraph 1 — Background and Qualifications of Affiant
1.  I currently hold the title of Senior Vice President, Reinsurance & Capital Markets, at Quorum Insurance Holdings Corp. ("QIH"), a Delaware corporation publicly traded on the Nasdaq Stock Market under the ticker symbol "QIHC," with its principal executive offices located at 200 Constitution Plaza, Suite 3400, Hartford, Connecticut 06103. I have served in this capacity at QIH since April 2014, a period of approximately twelve years.
2.  In my role as Senior Vice President, Reinsurance & Capital Markets, I am responsible for the oversight, negotiation, placement, and administration of reinsurance programs maintained by QIH and its insurance company subsidiaries. My responsibilities include directing QIH's relationships with reinsurance counterparties, reinsurance intermediaries, and brokers, as well as overseeing the management and resolution of reinsurance recoverables and disputes arising under reinsurance treaties and facultative certificates placed on behalf of QIH's subsidiaries.
3.  I have direct supervisory responsibility over the reinsurance program of QC&S, a New York-domiciled stock property and casualty insurance company assigned National Association of Insurance Commissioners ("NAIC") Number 24891. QC&S is QIH's principal insurance subsidiary and maintains its principal office at 200 Constitution Plaza, Suite 3200, Hartford, Connecticut 06103. QC&S is a wholly owned subsidiary of QIH.
4.  Prior to joining QIH, I held positions in reinsurance underwriting and treaty management at Sterling Reach Corporation and at Glenrock Partners LLC. I hold a Master of Business Administration degree from the Wharton School of the University of Pennsylvania and a Bachelor of Science degree in Actuarial Science from the University of Connecticut. I am a Fellow of the Casualty Actuarial Society (FCAS) and a Chartered Property Casualty Underwriter (CPCU). I have over twenty-two years of experience in the reinsurance industry.
Paragraph 2 — Purpose of the Affidavit
5.  I submit this affidavit to provide the Court with facts regarding the following matters:
(a) The negotiation and execution of Aggregate Excess-of-Loss Reinsurance Treaty No. PA-QCS-2019-EXL-0044 (the "Treaty") between QC&S, as cedent, and Pinnacle Atlantic Reinsurance Ltd. ("Pinnacle Atlantic" or "PARL"), a Bermuda Class 4 insurer registered with the Bermuda Monetary Authority under Registration Number BMA-4R-2008-0331;
(b) The parties' mutual intent that all disputes arising under or in connection with the Treaty be resolved through binding arbitration as set forth in Article 22 of the Treaty (the "Arbitration Clause");
(c) The role of Broadreach Intermediaries Inc. ("Broadreach"), a New York-licensed reinsurance intermediary, in the placement and administration of the Treaty; and
(d) The authentication of the Treaty and related documents attached hereto as Exhibits A through F.
6.  I am the most knowledgeable person at QIH and QC&S regarding the negotiation, execution, and administration of the Treaty. I was the lead negotiator on behalf of QC&S during the placement of the Treaty and am a signatory to the Treaty.
Paragraph 3 — Description of Quorum Casualty & Surety Company
7.  QC&S is a New York-domiciled stock property and casualty insurance company. QC&S is licensed to write insurance in all fifty states, the District of Columbia, and the U.S. Virgin Islands, and is assigned NAIC Number 24891. QC&S has been continuously licensed and actively writing insurance business in the State of New York since 1962.
8.  As of the most recent available financial statements, QC&S's A.M. Ridgeway rating (2025) is A (Excellent), with a Stable outlook. QC&S's statutory surplus as reported in its Annual Statement filed with the New York State Department of Financial Services as of December 31, 2025 was approximately $1.42 billion.
9.  QC&S principally writes commercial general liability, excess and umbrella liability, and professional liability (including errors and omissions and directors and officers) insurance policies, among other commercial lines of business. QC&S is a wholly owned subsidiary of QIH. For fiscal year 2025, QIH reported gross written premium of approximately $4.18 billion and net earned premium of approximately $2.93 billion, as disclosed in QIH's Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission.
Paragraph 4 — Description of Pinnacle Atlantic Reinsurance Ltd.
10.  Pinnacle Atlantic Reinsurance Ltd. ("Pinnacle Atlantic" or "PARL") is a Bermuda-domiciled Class 4 insurer, registered with the Bermuda Monetary Authority under Registration Number BMA-4R-2008-0331. Pinnacle Atlantic maintains its registered office at Clarendon House, 14 Church Street, Hamilton HM 11, Bermuda, and maintains a United States office at 1285 Avenue of the Americas, 28th Floor, New York, New York 10019.
11.  Pinnacle Atlantic is a subsidiary of Pinnacle Atlantic Group Holdings Ltd. ("PAGH"), a Bermuda exempted company. PAGH and its subsidiaries, including Pinnacle Atlantic, constitute a global reinsurance group specializing in casualty treaty and facultative reinsurance. For fiscal year 2025, Pinnacle Atlantic reported gross reinsurance assumed of approximately $9.6 billion. Pinnacle Atlantic's Chief Executive Officer is Sir Edmund Haverford.
12.  Pinnacle Atlantic has, throughout its relationship with QC&S, maintained its U.S. office in New York, New York, and has regularly transacted reinsurance business within the State of New York.
Paragraph 5 — Description of Broadreach Intermediaries Inc.
13.  Broadreach Intermediaries Inc. ("Broadreach") is a New York corporation and licensed reinsurance intermediary, with its principal office located at 100 Wall Street, 18th Floor, New York, New York 10005. Broadreach is licensed as a reinsurance intermediary in the State of New York and in numerous other jurisdictions throughout the United States.
14.  The Account Executive at Broadreach responsible for the placement and ongoing administration of the Treaty is James "Jamie" Castellano. Mr. Castellano was the primary point of contact at Broadreach throughout the negotiation, placement, and administration of the Treaty.
15.  Broadreach served as the intermediary broker for the placement and administration of the Treaty, as expressly designated under Article 9 of the Treaty (the "Intermediary Clause"). In its capacity as intermediary, Broadreach facilitated all premium payments and claims-settlement transmittals between QC&S and Pinnacle Atlantic. In accordance with standard industry practice and the terms of Article 9, all premium remittances by QC&S to Pinnacle Atlantic, and all reinsurance recovery payments by Pinnacle Atlantic to QC&S, were processed through Broadreach's fiduciary trust accounts.
16.  Broadreach holds the original treaty slips, placement records, and certain correspondence relating to the negotiation and placement of the Treaty.
Paragraph 6 — Negotiation of the Treaty
17.  In early 2019, QC&S undertook a comprehensive review of its reinsurance program for its commercial casualty lines of business, including commercial general liability, excess and umbrella liability, and professional liability. The purpose of the review was to evaluate the adequacy and pricing of QC&S's aggregate excess-of-loss protection, particularly in light of increasing loss activity in QC&S's professional liability and commercial general liability books of business.
18.  As part of this review, I personally led the negotiations on behalf of QC&S for the placement of a new aggregate excess-of-loss reinsurance treaty to provide protection for QC&S's commercial casualty lines. I was the principal decision-maker at QC&S with respect to the structure, terms, and conditions of the treaty to be placed.
19.  QC&S engaged Broadreach to act as its reinsurance intermediary for the placement of the Treaty. Jamie Castellano of Broadreach was designated as the lead Account Executive for this engagement. Through Broadreach, QC&S solicited proposals from a number of prospective reinsurers, including Pinnacle Atlantic.
20.  Jamie Castellano of Broadreach facilitated communications with prospective reinsurers, including Pinnacle Atlantic, and circulated preliminary term sheets and draft treaty language among the parties. The negotiations between QC&S and Pinnacle Atlantic involved multiple rounds of term sheets, draft treaty language, and written comments exchanged between the parties through Broadreach.
21.  In addition to communications exchanged through Broadreach, the negotiations involved a series of in-person meetings between QC&S personnel (including myself), Broadreach representatives (including Mr. Castellano), and Pinnacle Atlantic representatives. Among the Pinnacle Atlantic personnel with whom I personally negotiated was Conrad Hesse, who at that time served in an underwriting capacity at Pinnacle Atlantic and who currently holds the title of Senior Vice President, Treaty Disputes & Recoveries. Mr. Hesse was one of Pinnacle Atlantic's principal representatives during the negotiation of the Treaty's terms and conditions, including the arbitration provision.
22.  The negotiations took place principally in New York, New York, including meetings held at Broadreach's offices at 100 Wall Street, at Pinnacle Atlantic's U.S. office at 1285 Avenue of the Americas, and at various other locations in the New York metropolitan area. The parties also exchanged drafts and comments via electronic mail and telephone throughout the negotiation period, which extended from approximately February 2019 through June 2019.
Paragraph 7 — Key Terms of the Treaty
23.  The Treaty that resulted from the negotiations described above bears the designation Aggregate Excess-of-Loss Reinsurance Treaty No. PA-QCS-2019-EXL-0044. A true and complete copy of the Treaty, including all endorsements and amendments through the date of this affidavit, is attached hereto as Exhibit A. The key terms of the Treaty are as follows:
(a) Treaty Number: PA-QCS-2019-EXL-0044.
(b) Effective Date: July 1, 2019.
(c) Type: Aggregate Excess-of-Loss Reinsurance Treaty, covering casualty lines of business.
(d) Cedent: Quorum Casualty & Surety Company.
(e) Reinsurer: Pinnacle Atlantic Reinsurance Ltd.
(f) Original Treaty Term: Five (5) years, from July 1, 2019 through June 30, 2024, with automatic annual extensions unless either party provides ninety (90) days' prior written notice of non-renewal.
(g) Covered Lines of Business: Commercial general liability, excess and umbrella liability, and professional liability policies issued by QC&S.
(h) Retention per Treaty Year: $120,000,000 (one hundred twenty million dollars) in aggregate net incurred losses.
(i) Cession Limit per Treaty Year: $200,000,000 (two hundred million dollars) in aggregate net incurred losses in excess of the retention, covering losses from $120,000,000 to $320,000,000.
(j) Treaty Premium: Provisional rate of 42% of ceded earned premium, subject to a slide-scale adjustment based on loss experience, with a minimum rate of 35% and a maximum rate of 52%.
(k) Intermediary Clause: Article 9, designating Broadreach Intermediaries Inc. as the intermediary broker for the placement and administration of the Treaty.
(l) Governing Law: Article 16, providing that the Treaty shall be governed by and construed in accordance with the laws of the State of New York, without regard to its principles of conflicts of law.
(m) Arbitration: Article 22, providing for binding arbitration of all disputes arising under or in connection with the Treaty, conducted before a three-member arbitration panel seated in New York, New York, under the ARIAS-U.S. Rules.
24.  I executed the Treaty on behalf of QC&S in my capacity as Senior Vice President, Reinsurance & Capital Markets, of QIH, acting as an authorized signatory of QC&S. The Treaty was countersigned on behalf of Pinnacle Atlantic by authorized representatives of that company.
Paragraph 8 — Treaty Extensions
25.  The Treaty was originally set to expire on June 30, 2024. However, pursuant to the automatic renewal provision described in Paragraph 23(f) above, the Treaty has been extended beyond its original expiration date through two successive automatic one-year extensions.
26.  The first automatic extension covered the period from July 1, 2024 through June 30, 2025. Neither party provided ninety (90) days' prior written notice of non-renewal in advance of the June 30, 2024 expiration date, and accordingly, the Treaty automatically extended for one additional year.
27.  The second automatic extension covered the period from July 1, 2025 through June 30, 2026. Again, neither party provided timely notice of non-renewal in advance of the June 30, 2025 anniversary date, and accordingly, the Treaty automatically extended for a second additional year.
28.  On October 1, 2025, Pinnacle Atlantic provided QC&S with written notice of non-renewal of the Treaty. A true and complete copy of the non-renewal notice is attached hereto as Exhibit E. Because the non-renewal notice was delivered more than ninety (90) days in advance of the June 30, 2026 expiration of the second extension period, the Treaty will lapse at the end of the second extension period on June 30, 2026. As of the date of this affidavit, the Treaty remains in force.
29.  During the entire term of the Treaty, including both automatic extension periods, both parties performed their respective obligations under the Treaty. This includes, among other things, QC&S's timely payment of treaty premium and submission of loss reports and cession statements, and Pinnacle Atlantic's payment of reinsurance recoverables in respect of ceded losses. In particular, between October 15, 2022 and March 29, 2024, Pinnacle Atlantic paid a total of $78,400,000 (seventy-eight million four hundred thousand dollars) in reinsurance recoverables to QC&S across seven separate billing installments. These payments were processed through Broadreach in accordance with the Treaty's billing and settlement procedures. Representative billing transmittals evidencing these payments are attached hereto as Exhibit F.
Paragraph 9 — Negotiation and Intent of the Arbitration Clause (Article 22)
30.  Article 22 of the Treaty (the "Arbitration Clause") provides for binding arbitration of all disputes arising under or in connection with the Treaty. A true and complete copy of Article 22, extracted from the Treaty for the Court's convenience, is attached hereto as Exhibit B.
31.  Specifically, Article 22 provides that any dispute arising out of or relating to the formation, interpretation, performance, or breach of the Treaty, or any other matter arising under or in connection with the Treaty, shall be submitted to and resolved by a panel of three arbitrators, each of whom shall be a current or former officer of an insurance or reinsurance company, seated in New York, New York, and conducted in accordance with the ARIAS-U.S. Rules then in effect, as modified by the specific provisions of Article 22.
32.  I was directly involved in the negotiation of Article 22. The arbitration provision was a subject of specific and detailed discussion between the negotiating teams of QC&S and Pinnacle Atlantic during the treaty negotiation process in the spring of 2019.
33.  During the course of negotiations, both QC&S and Pinnacle Atlantic specifically discussed the scope of the arbitration provision, the selection and qualifications of arbitrators, the procedural rules to govern any arbitration, and the seat of arbitration. These discussions were conducted both in person and through written correspondence exchanged via Broadreach. At various stages of the negotiation, the parties exchanged redlined drafts of Article 22, reflecting proposed modifications and comments from each side.
34.  Both parties understood and intended that Article 22 would serve as the exclusive mechanism for resolving any and all disputes arising under or relating to the Treaty. This includes, without limitation, disputes concerning the validity of cessions, loss allocation and reserve development, notice requirements, claim settlements and the follow-the-fortunes and follow-the-settlements doctrines, premium calculations and adjustments, and all other obligations arising under or in connection with the Treaty.
35.  The arbitration clause was not a boilerplate or form provision inserted without deliberation. Rather, Article 22 was specifically negotiated and agreed upon by the parties as a material term of the Treaty. Both parties were represented by experienced reinsurance professionals who were fully aware of the implications and scope of the arbitration provision.
36.  At no point during the negotiation of the Treaty did Pinnacle Atlantic propose, nor did any party agree, that certain categories of claims or disputes would be carved out from the scope of the arbitration clause. There was no discussion or suggestion by any party that disputes concerning late notice, loss allocation, follow-the-fortunes compliance, or premium reporting would be excluded from arbitration or subject to resolution through court litigation. To the contrary, the parties' intent was to ensure that all Treaty-related disputes would be resolved by arbitrators possessing specialized knowledge of the reinsurance industry.
37.  The breadth of the arbitration language contained in Article 22 was intentional and reflects both parties' preference for the resolution of reinsurance disputes by a panel composed of individuals with reinsurance industry expertise. This preference is consistent with the longstanding custom and practice in the reinsurance industry, which strongly favors arbitration as the dispute resolution mechanism for treaty-based disputes. Both QC&S and Pinnacle Atlantic are sophisticated reinsurance market participants that routinely include arbitration clauses in their reinsurance treaties and that have extensive experience with reinsurance arbitration proceedings.
Paragraph 10 — Course of Dealing Between the Parties
38.  QC&S and Pinnacle Atlantic have maintained a reinsurance relationship extending beyond the Treaty at issue in this proceeding. In addition to the Treaty, QC&S and Pinnacle Atlantic are parties to other reinsurance agreements and have an ongoing business relationship spanning multiple treaty years and multiple lines of business.
39.  Throughout the Treaty's term, including both automatic extension periods, all disputes and questions regarding Treaty administration—including loss reports, billing statements, premium calculations, loss allocation, reserve development notifications, claims settlement practices, and treaty interpretation—were addressed between the parties, either directly or through Broadreach as intermediary, with the mutual understanding that any dispute that could not be resolved through informal discussions and negotiations would be submitted to binding arbitration under Article 22.
40.  To the best of my knowledge and belief, no dispute between QC&S and Pinnacle Atlantic arising under the Treaty has previously been commenced by either party through court litigation. Throughout the entire term of the Treaty, the parties' course of dealing has consistently contemplated arbitration as the exclusive dispute resolution mechanism for Treaty-based disputes. This mutual understanding was reflected in the parties' conduct, their communications, and their consistent adherence to the terms and procedures set forth in the Treaty.
41.  Pinnacle Atlantic's pre-suit demand letter dated February 14, 2026, transmitted by its counsel, Hargrove, Fitch & Calloway LLP ("HFC"), of 51 West 52nd Street, 40th Floor, New York, New York 10019, with lead partner Nathaniel R. Calloway III, is the first instance in which Pinnacle Atlantic or its counsel has asserted that Article 22 of the Treaty is inapplicable to any category of dispute arising under the Treaty. Prior to the February 14, 2026 demand letter, neither Pinnacle Atlantic nor any representative or counsel acting on its behalf ever suggested, orally or in writing, that the arbitration clause did not apply to any dispute under the Treaty, or that any particular category of dispute would be properly resolved through court litigation rather than arbitration.
Paragraph 11 — The Current Dispute Falls Within the Arbitration Clause
42.  On December 12, 2025, Pinnacle Atlantic sent a reservation-of-rights letter to QC&S concerning the treaty year 2022 ("TY 2022") and treaty year 2023 ("TY 2023") cessions made by QC&S under the Treaty. A true and complete copy of this reservation-of-rights letter is attached hereto as Exhibit C. The reservation-of-rights letter raised general concerns regarding the cessions for those treaty years but did not assert that Article 22 was inapplicable or that Pinnacle Atlantic intended to pursue litigation rather than arbitration.
43.  On February 14, 2026, Hargrove, Fitch & Calloway LLP, acting as counsel for Pinnacle Atlantic, sent a pre-suit demand letter to QC&S demanding the return of $78,400,000 (seventy-eight million four hundred thousand dollars) in previously paid reinsurance recoverables, plus $12,600,000 (twelve million six hundred thousand dollars) in accrued interest, for a total demand of $91,000,000 (ninety-one million dollars). A true and complete copy of this demand letter is attached hereto as Exhibit D.
44.  The demand letter asserts four distinct grounds in support of Pinnacle Atlantic's claim:
(1) Late Notice Under Article 7: Pinnacle Atlantic alleges that QC&S provided untimely notice to Pinnacle Atlantic regarding the Meridian Docks mass tort claim cluster, in purported violation of the notice requirements set forth in Article 7 of the Treaty.
(2) Misallocation of IBNR Reserve Development Under Article 5: Pinnacle Atlantic alleges that QC&S improperly allocated approximately $22,300,000 (twenty-two million three hundred thousand dollars) in incurred but not reported ("IBNR") reserve development to the ceded loss account under Article 5 of the Treaty.
(3) Failure to Follow the Fortunes / Settlements Under Article 11: Pinnacle Atlantic alleges that QC&S failed to comply with the follow-the-fortunes and follow-the-settlements obligations set forth in Article 11 of the Treaty in connection with the settlement of the Veridian Financial Services errors and omissions ("E&O") claim cluster.
(4) Inaccurate Premium Reporting Under Article 3: Pinnacle Atlantic alleges that QC&S submitted inaccurate premium reports to Pinnacle Atlantic under Article 3 of the Treaty, resulting in an underpayment of treaty premium.
45.  Each of these four grounds asserted in the demand letter directly arises under or relates to specific articles of the Treaty—namely, Articles 3, 5, 7, and 11. These claims concern the interpretation and application of the Treaty's provisions governing premium reporting, loss allocation and reserve development, notice requirements, and claim settlement practices—all matters that are at the core of the reinsurance relationship established by the Treaty.
46.  These are quintessential Treaty-based disputes that fall squarely within the scope of Article 22's broad arbitration clause, which encompasses all disputes "arising out of or relating to the formation, interpretation, performance, or breach of this Treaty, or any other matter arising under or in connection with this Treaty." There is no colorable argument that the claims raised by Pinnacle Atlantic fall outside the scope of Article 22.
47.  HFC's assertion in the February 14, 2026 demand letter that Article 22 is inapplicable to the claims at issue is wholly inconsistent with the plain language of Article 22, the intent of the parties as specifically negotiated and agreed upon during the placement of the Treaty, and the course of dealing between QC&S and Pinnacle Atlantic throughout the Treaty's term.
Paragraph 12 — Pinnacle Atlantic's Performance Under the Treaty Preceding the Dispute
48.  As set forth above, between October 15, 2022 and March 29, 2024, Pinnacle Atlantic paid a total of $78,400,000 (seventy-eight million four hundred thousand dollars) in reinsurance recoverables to QC&S across seven separate billing installments. Each of these payments was made through the intermediary, Broadreach, in accordance with the Treaty's billing and settlement procedures as set forth in Articles 5 and 9 of the Treaty. Representative billing transmittals evidencing these payments are attached hereto as Exhibit F.
49.  At the time of and prior to making each of these seven installment payments, Pinnacle Atlantic did not raise any objection to the validity or propriety of the cessions submitted by QC&S, the notice provided by QC&S regarding underlying claims (including the Meridian Docks mass tort cluster), the allocation of IBNR reserve development under Article 5, the settlement of the Veridian Financial Services E&O claim cluster, or the premium reporting submitted by QC&S under Article 3. Pinnacle Atlantic paid each billing installment in full and without reservation or qualification.
50.  Pinnacle Atlantic's reservation-of-rights letter was not sent until December 12, 2025, more than twenty (20) months after the final billing installment payment of $9,200,000 was made on March 29, 2024. During the intervening period of more than twenty months, Pinnacle Atlantic did not communicate any concern, objection, or reservation regarding any aspect of QC&S's cessions, notices, loss allocations, premium reporting, or settlement practices under the Treaty.
51.  Pinnacle Atlantic's prolonged silence, followed by a belated demand for the return of all reinsurance recoverables previously paid without objection, underscores the importance of resolving these Treaty-based disputes through the arbitration mechanism that both parties specifically negotiated and agreed upon. Arbitration before a panel of reinsurance industry professionals is the appropriate forum for the resolution of these complex reinsurance disputes, as both parties intended when they entered into the Treaty.
Paragraph 13 — Authentication of Treaty and Exhibits
52.  The following documents are attached hereto as exhibits to this affidavit and are each authenticated as described below:
(a) Exhibit A: Attached hereto as Exhibit A is a true and complete copy of the Aggregate Excess-of-Loss Reinsurance Treaty No. PA-QCS-2019-EXL-0044, effective July 1, 2019, including all endorsements and amendments through the date of this affidavit. I am personally familiar with this document, as I was the lead negotiator on behalf of QC&S during the placement of the Treaty and am a signatory to the Treaty.
(b) Exhibit B: Attached hereto as Exhibit B is a true and complete copy of Article 22 of the Treaty (Arbitration), extracted from the Treaty for the Court's convenience. Exhibit B reproduces Article 22 in its entirety, without alteration or omission.
(c) Exhibit C: Attached hereto as Exhibit C is a true and complete copy of the reservation-of-rights letter from Pinnacle Atlantic to QC&S, dated December 12, 2025. This letter was received by QC&S at its offices in Hartford, Connecticut, and a copy was maintained in QC&S's and QIH's business records in the ordinary course of business.
(d) Exhibit D: Attached hereto as Exhibit D is a true and complete copy of the pre-suit demand letter from Hargrove, Fitch & Calloway LLP on behalf of Pinnacle Atlantic to QC&S, dated February 14, 2026. This letter was received by QC&S and forwarded to QC&S's outside counsel, Calderwood & Harkness LLP, and a copy was maintained in QC&S's and QIH's business records in the ordinary course of business.
(e) Exhibit E: Attached hereto as Exhibit E is a true and complete copy of the non-renewal notice from Pinnacle Atlantic to QC&S, dated October 1, 2025. This notice was received by QC&S at its offices in Hartford, Connecticut, and a copy was maintained in QC&S's and QIH's business records in the ordinary course of business.
(f) Exhibit F: Attached hereto as Exhibit F are representative billing transmittals evidencing the seven installment payments by Pinnacle Atlantic totaling $78,400,000 (seventy-eight million four hundred thousand dollars), covering the period from October 15, 2022 through March 29, 2024. Each of these billing transmittals was transmitted through Broadreach Intermediaries Inc. in accordance with Article 9 of the Treaty and was maintained in QC&S's and QIH's business records in the ordinary course of business.
53.  I attest that each exhibit attached hereto is a true and correct copy of the original document as maintained in the records of QC&S and/or QIH. I have reviewed each document and confirmed its accuracy and completeness.
Paragraph 14 — Conclusion
54.  For the foregoing reasons, I respectfully submit as follows:
(a) The Treaty contains a valid and enforceable arbitration clause in Article 22, which provides for binding arbitration of all disputes arising under or in connection with the Treaty before a three-member panel of arbitrators seated in New York, New York, and conducted under the ARIAS-U.S. Rules.
(b) The arbitration clause set forth in Article 22 was specifically negotiated and agreed upon by both QC&S and Pinnacle Atlantic as a material term of the Treaty. Both parties intended that Article 22 would serve as the exclusive mechanism for the resolution of all disputes arising under or in connection with the Treaty, without exception or carve-out.
(c) All four grounds raised in Pinnacle Atlantic's pre-suit demand letter dated February 14, 2026—namely, the alleged late notice under Article 7, the alleged misallocation of IBNR reserve development under Article 5, the alleged failure to follow the fortunes/settlements under Article 11, and the alleged inaccurate premium reporting under Article 3—constitute disputes arising under the Treaty and fall squarely within the scope of Article 22.
(d) The parties' course of dealing throughout the entire term of the Treaty, including both automatic extension periods, confirms the mutual understanding that disputes under the Treaty would be resolved through binding arbitration in accordance with Article 22. No dispute under the Treaty has ever been commenced through court litigation, and Pinnacle Atlantic never previously asserted that the arbitration clause was inapplicable.
(e) Pinnacle Atlantic should be compelled to arbitrate its claims against QC&S pursuant to Article 22 of the Treaty, under the ARIAS-U.S. Rules, before a three-member panel of arbitrators seated in New York, New York.
55.  I respectfully request that the Court grant QC&S's motion to compel Pinnacle Atlantic to submit its claims to binding arbitration pursuant to Article 22 of the Treaty and to stay any and all litigation in this proceeding pending completion of the arbitration.
I declare under penalty of perjury under the laws of the State of Connecticut and the laws of the United States that the foregoing is true and correct.
________________________________________
Tobias Engström Senior Vice President, Reinsurance & Capital Markets Quorum Insurance Holdings Corp. 200 Constitution Plaza, Suite 3400 Hartford, CT 06103
Date: ___, 2026
NOTARY ACKNOWLEDGMENT
STATE OF CONNECTICUT ) COUNTY OF HARTFORD ) ss.:
Sworn to and subscribed before me this _ day of ___, 2026, by Tobias Engström, who is personally known to me or who produced satisfactory evidence of identification.
________________________________________
Notary Public, State of Connecticut My Commission Expires: _____
[Notary Stamp / Seal]
EXHIBIT LIST
The following exhibits are attached hereto and incorporated by reference into the foregoing Affidavit of Tobias Engström:
ATTORNEY CERTIFICATION / FILING BLOCK
Prepared by:
CALDERWOOD & HARKNESS LLP
By: ________
Jeffrey Park, Esq. One Liberty Plaza, 55th Floor New York, New York 10006 Telephone: (212) 558-4000 Facsimile: (212) 558-3588
Matter No. 1025-00005
Attorneys for Defendant/Respondent Quorum Casualty & Surety Company
Exhibit | Description
Exhibit A | Aggregate Excess-of-Loss Reinsurance Treaty No. PA-QCS-2019-EXL-0044, effective July 1, 2019 (complete with all endorsements and amendments through date of affidavit)
Exhibit B | Article 22 of the Treaty (Arbitration) — extracted for convenience of the Court
Exhibit C | Pinnacle Atlantic Reinsurance Ltd. Reservation-of-Rights Letter, dated December 12, 2025
Exhibit D | Pre-Suit Demand Letter from Hargrove, Fitch & Calloway LLP on behalf of Pinnacle Atlantic Reinsurance Ltd., dated February 14, 2026
Exhibit E | Pinnacle Atlantic Reinsurance Ltd. Non-Renewal Notice, dated October 1, 2025
Exhibit F | Representative Billing Transmittals — Seven Installment Payments totaling $78,400,000 (October 15, 2022 through March 29, 2024), transmitted through Broadreach Intermediaries Inc.

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK — COMMERCIAL DIVISION

PINNACLE ATLANTIC REINSURANCE LTD.,

QUORUM CASUALTY & SURETY COMPANY,

NOTARY ACKNOWLEDGMENT

EXHIBIT LIST

ATTORNEY CERTIFICATION / FILING BLOCK

CALDERWOOD & HARKNESS LLP

Record

Parties

Dates

Amounts