Everest Group, Ltd DEF 14A, filed Apr 14, 2023
Everest Group, Ltd. (EG)
DEF 14A
2023-04-14
View Original
Added on
June 12, 2026
About this DEF 14A
Everest Group, Ltd filed this DEF 14A on April 14, 2023.
`
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section
14(a) of
the Securities Exchange Act of 1934 (Amendment No.
)
Filed by the Registrant
☒
Filed by a Party other than the Registrant
☐
Check the appropriate box:
☐
Preliminary Proxy Statement
☐
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
☒
Definitive Proxy Statement
☐
Definitive Additional
Materials
☐
Soliciting Material Pursuant to §
240.14a -12
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
☒
No fee required
☐
Fee paid previously with preliminary materials
☐
Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a
-
6(i)(1) and
0-11
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 17, 2023
TO THE SHAREHOLDERS OF EVEREST RE GROUP, LTD.:
The Annual General Meeting of Shareholders of Everest Re Group, Ltd. (the “Company”), a Bermuda
company, will be held at Fairmont Hamilton Princess, 76 Pitts Bay Road, Hamilton, Bermuda on May 17,
2023 at 10:00 a.m., local time, for the following purposes:
1.
To elect John J. Amore, Juan C. Andrade, William F. Galtney, Jr., John A. Graf, Meryl Hartzband, Gerri
Losquadro, Hazel McNeilage, Roger M. Singer and Joseph V. Taranto as directors of the Company, each
to serve for a one-year period to expire at the 2024 Annual General Meeting of Shareholders or until
such director’s successor shall have been duly elected or appointed or until such director’s office is
otherwise vacated.
2.
To appoint PricewaterhouseCoopers LLP, an independent registered public accounting firm, as the
Company’s independent auditor for the year ending December 31, 2023 and authorize the Company’s
Board of Directors, acting through its Audit Committee, to determine the independent auditor’s
remuneration.
3. To approve, by non -binding advisory vote, 2022 compensation paid to the Company’s Named Executive
Officers.
4. To cast a non-binding advisory vote on the frequency of future non-binding advisory votes on executive
compensation.
5.
To consider and approve a resolution to change the name of the Company from “Everest Re Group,
Ltd.” to “Everest Group, Ltd.” and to amend our Bye-laws accordingly.
6.
To consider and act upon such other business, if any, as may properly come before the meeting and
any and all adjournments thereof.
The Company’s financial statements for the year ended December 31, 2022, together with the report of
the Company’s auditor in respect of those financial statements, as approved by the Company’s Board of
Directors, will be presented at this Annual General Meeting.
Only shareholders of record identified in the Company’s Register of Members at the close of business on
March 20, 2023 are entitled to notice of and vote at, the Annual General Meeting.
You are cordially invited to attend the meeting in person. Whether or not you expect to attend the meeting
in
person, you are urged to vote by internet or telephone as directed on the enclosed proxy or by signing and
dating the proxy and returning it promptly in the postage prepaid envelope provided.
By Order of the Board of Directors
Juan C. Andrade
President & CEO
April 14, 2023
Hamilton, Bermuda
`
TABLE OF CONTENTS
ENVIRONMENTAL, SOCIAL AND GOVERNANCE 3
PROPOSAL NO. 1—ELECTION OF DIRECTORS 17
Information
Concerning
Director
Nominees
Information
Concerning
Executive
Officers
THE BOARD OF DIRECTORS AND ITS
COMMITTEES 31
Director
Enhanced Compensation Committee
Independence Requirements 34
Audit Committee 39
Audit Committee Report 39
Risk
Code of Ethics for CEO and Senior Financial
Officers 42
Shareholder and Interested Party
Communications
with
Directors
COMMON SHARE OWNERSHIP BY DIRECTORS
AND EXECUTIVE OFFICERS 44
PRINCIPAL
BENEFICIAL
OWNERS
OF
COMMON SHARES 45
2022
Director
Compensation
Table
Executive
THE COMPANY’S COMPENSATION
PHILOSOPHY AND OBJECTIVES 52
Components of the Company’s Compensation
Program 53
The Role of Peer Companies and Benchmarking 54
Incentive Based Bonus Plans 55
Executive Performance Annual Incentive Plan 55
Link Between Pay and Performance for 2022 63
Summary of Direct Compensation Awarded
in 2022
Other Forms of Compensation 68
Clawback Policy 69
Perquisites and Other Benefits 69
Tax
and
Accounting
Implications
Summary Compensation Table 70
2022 Grants of Plan-Based Awards 71
Outstanding Equity Awards at Fiscal Year-End 2022 72
Share Option Exercises and Shares Vested 73
2022
Pension
Benefits
Table
PAY VERSUS PERFORMANCE DISCLOSURE 76
CEO PAY RATIO DISCLOSURE 80
EMPLOYMENT, CHANGE OF CONTROL AND
OTHER AGREEMENTS 81
Potential
Payments
Upon
Termination
or
Change in Control 82
Termination or Change of Control 84
COMPENSATION COMMITTEE
INTERLOCKS
AND
INSIDER
PARTICIPATION
PROPOSAL
NO.
3—NON-BINDING
ADVISORY
VOTE ON EXECUTIVE COMPENSATION 88
PROPOSAL NO. 4—NON-BINDING ADVISORY
VOTE ON FREQUENCY OF VOTE ON EXECUTIVE
COMPENSATION 89
PROPOSAL NO. 5—NAME CHANGE 90
2023 Proxy Statement
1
Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to be Held on May 17,
2023 at Fairmont Hamilton Princess, 76 Pitts Bay Road, Hamilton, Bermuda at 10:00 a.m. local time.
The
proxy
statement
and
annual
report
to
shareholders
are
available
at
https://investors.everestre.com/shareholder -proxy-materials
PROXY STATEMENT
_______________
ANNUAL GENERAL MEETING OF SHAREHOLDERS
May 17, 2023
GENERAL INFORMATION
The enclosed Proxy Card is being solicited on behalf of the Board of Directors (the “Board”) for use at the 2023 Annual
General Meeting of Shareholders of Everest Re Group, Ltd., a Bermuda company (the “Company”), to be held on May
17, 2023 and at any adjournment thereof. It may be revoked at any time before it is exercised by giving a later-dated
proxy, notifying the Secretary of the Company in writing at the Company’s registered office at Clarendon House, 2
Church Street, Hamilton HM 11, Bermuda, or by voting in person at the Annual General Meeting. All shares represented
at the meeting by properly executed proxies will be voted as specified and, unless otherwise specified, will be voted:
(1) for the election of John J. Amore, Juan C. Andrade, William F. Galtney, Jr., John A. Graf, Meryl Hartzband, Gerri
Losquadro, Hazel McNeilage, Roger M. Singer and Joseph V. Taranto as directors of the Company; (2) for the appointment
of PricewaterhouseCoopers LLP, an independent registered public accounting firm, as the Company’s independent
auditor for 2023 and for authorizing the Company’s Board of Directors acting through its Audit Committee to determine
the independent auditor’s remuneration; (3) for the approval, by non-binding advisory vote, of the 2022 compensation
paid to the Named Executive Officers (as defined herein); (4) to cast a non-binding advisory vote on the frequency of
future non-binding advisory votes on executive compensation; and (5) for the approval to formally change our corporate
name from Everest Re Group, Ltd. to Everest Group, Ltd. and amend our Bye-Laws to reflect the name change.
Only shareholders of record at the close of business on March 20, 2023 will be entitled to vote at the meeting. On
that date, 49,007,914 Common Shares, par value $.01 per share (“Common Shares”), were outstanding. However,
this amount includes 9,719,971 Common Shares held by Everest Re Advisors, Ltd. (“Re Advisors”), the Company’s
subsidiary. As provided in the Company’s Bye-laws, Re Advisors may vote only 4,851,783 of its shares. The outstanding
share amount also excludes 40,870 shares with no voting rights. The limitation of Re Advisors voting shares to 4,851,783
and the exclusion of 40,870 shares with no voting rights results in 44,098,856 Common Shares entitled to vote.
The election of each nominee for director and the approval of all other matters to be voted upon at the Annual
General Meeting require the affirmative vote of a majority of the votes cast at the Annual General Meeting, provided
there is a quorum consisting of not less than two persons present in person or by proxy holding in excess of 50%
of the issued and outstanding Common Shares entitled to attend and vote at the Annual General Meeting. The
Company has appointed inspectors of election to count votes cast in person or by proxy. Common Shares owned
by shareholders who are present in person or by proxy at the Annual General Meeting but who elect to abstain from
voting will be counted towards the presence of a quorum. However, such Common Shares and Common Shares
owned by shareholders and not voted in person or by proxy at the Annual General Meeting (including “broker non-
votes”) will not be counted towards the majority needed to elect a director or approve any other matter before the
shareholders and, thus, will have no effect on the outcome of those votes.
This Proxy Statement, the attached Notice of Annual General Meeting, the Annual Report of the Company for the year
ended December 31, 2022 (including financial statements) and the enclosed Proxy Card are first being mailed to the
Company’s shareholders on or about April 14, 2023.
All
references
in
this
document
to
“$”
or
“dollars”
are
references
to
the
currency
of
the
United
States
of
America.
The Company knows of no specific matter to be brought before the Annual General Meeting that is not referred
to in the attached Notice of Annual General Meeting of Shareholders and this Proxy Statement. If any such matter
comes before the meeting, including any shareholder proposal properly made, the proxy holders will vote proxies
in accordance with their best judgment with respect to such matters. To be properly made, a shareholder proposal
must comply with the Company’s Bye-laws and, in order for any matter to come before the meeting, it must relate
to
matters referred to in the attached Notice of Annual General Meeting.
Executive Summary
2
2023 Proxy Statement
EXECUTIVE SUMMARY
This summary highlights certain information contained in the Company’s Proxy Statement. The summary does not
contain all of the information that you should consider, and we encourage you to read the entire Proxy Statement
carefully.
Financial Highlights
Against the backdrop of heightened global catastrophe activity for another consecutive year, the Company
earned $597 million of net income in fiscal year 2022. Gross written premiums grew by 6.9% to $14 billion, and the
Company earned $1.1 billion of net operating income and generated a 10.6% after tax operating return on adjusted
shareholders’ equity.
1
The foregoing performance demonstrates the strength of and success in our core strategic underwriting and risk
management initiatives, our ability to sustain multiple natural peril events and our resilience in the face of climate
change
and
social
and
material
inflation. Indeed, in
2022, the
Company
generated
a Total
Shareholder
Return
(“TSR”)
of
5.4%.
2
Such results were directly attributable to our core philosophy of long-term value creation for our shareholders
by
focusing on disciplined underwriting standards, diversifying our product line to maintain growth and protecting our
capital base by employing intelligent protection measures designed to minimize against downside exposure.
The resilience of our franchise led by the dedication and hard work of our people helped us to achieve positive results
for the year.
Returning Value to Shareholders
We returned $316 million to shareholders in 2022 in the form of dividends and share repurchases. The Company
repurchased $61 million of shares and paid $255 million in dividends.
Contribution of Insurance & Reinsurance Divisions to Overall Results
The success of our global diversification strategy and committed investment in the continued expansion of our
insurance segment manifested in another milestone of $4.6 billion in premium written by the Everest Insurance®
division. Diligent portfolio management and underwriting actions to improve returns resulted in an improved 94.8%
combined ratio for the Everest Insurance® division in 2022 (compared to a 97.1% combined ratio in 2021) and a
90.4% attritional combined ratio (compared to a 91.2% attritional combined ratio in 2021). The Everest Insurance®
division’s 2022 gross written premium also increased 16.4% compared to 2021. The increase in our premium was
the result of disciplined underwriting in conjunction with our ability to capitalize on improving economic conditions,
driving exposure growth and new business opportunities, a favorable rate environment and high renewal retention.
Our Reinsurance Division continued to execute its strategy of volatility management and reduced exposure to natural
catastrophe events, while maximizing profit, ultimately writing $9.3 billion in premiums with a 96.4% combined ratio
(compared to a 98.1% combined ratio in 2021) and a 86.2% attritional combined ratio (compared to a 86.3% attritional
combined
ratio
in
2021). The
2022
gross
written
premiums
for
the
Reinsurance
Division
also
increased
3%
compared
2021. Our premium growth has been driven by continued partnership with our core clients and Everest’s position as
a preferred reinsurance partner in the market.
1
Adjusted shareholders’ equity excludes net after-tax unrealized (appreciation) depreciation of available for sale Fixed Maturity securities. The Company
generally
uses
after-tax
operating
income
(loss), a
non-GAAP
financial
measure, to
evaluate
its
performance. Further
explanation
and
a
reconciliation
net income (loss) to after-tax operating income (loss) can be found at the back of the Everest Annual Report.
2
Total Shareholder Return (“TSR”), unless otherwise noted herein, means annual growth in Book Value Per Share (excluding Unrealized Gains and Losses
Fixed Maturity Investments) plus Dividends Per Share.
ESG
2023 Proxy Statement
3
ENVIRONMENTAL, SOCIAL AND GOVERNANCE
Environmental and Corporate Social Responsibility
Our commitment to Environmental, Social and Governance (“ESG”) issues is a core pillar of our corporate strategy at
Everest. Our dedication to these values benefits our stakeholders, communities and the environment over the long-
term. The sustainability of our Company is impacted not only by climate change and the heightened challenges of risk
management, exposure analysis and product development, but it also depends on the strength and well-being of our
employees and their diversity, professional development and opportunities to lead at work. Recognizing our impact
on the environment and reaching out to the communities in which we operate to promote environmental awareness
and support eco-friendly initiatives around the globe are integral to our strategic objectives. Thus, ESG is more than
an annual compliance exercise. It is a core element of our long-term strategy and a philosophy that we endeavor to
permeate across all operating disciplines including Human Resources, Actuarial, Finance and Accounting, Product
Development, Underwriting, Enterprise Risk Management, Legal & Compliance, Claims and Information Technology,
among others. The integration of ESG across our Company is one of our strategic priorities going forward in support
of our overall strategic objective to create long-term value for our shareholders.
Our recent ESG highlights, as well as a brief roadmap of upcoming disclosure goals and events, include:
1st Quarter 2022
Launched the EverGreen Business Resource Group. EverGreen focuses on
enhancing and streamlining our efforts to cultivate and drive a company-wide
culture of sustainability focusing on green initiatives throughout the organization.
In 2022, EverGreen held a Hurricane Season Kickoff event with a climate scientist
to present the hurricane season forecast and share his insights on how climate
change impacts the formation and strength of tropical storms and organized an
electronics recycling event at our U.S. headquarters.
Apr-22
Publication of Everest’s second comprehensive Corporate Responsibility Report, in
accordance with the Global Reporting Initiative standards and in alignment with the
Task Force on Climate-related Financial Disclosures recommendations.
4th Quarter 2022
and ongoing
Conducted a climate risk analysis of our investment portfolio to understand the
financed emissions associated with our investments and our exposure to climate risks
and opportunities, one of the key aspects of the Task Force on Climate- Related
Financial Disclosures recommendations.
1st Quarter 2023
Completion of greenhouse gas inventory of Scope 1 and 2 emissions for the 2022
calendar year from our U.S. and international offices. This data will be used to
determine a carbon footprint baseline and support us in developing Scope 1 and
2 emission reduction targets and goals throughout our business operations.
1st Quarter 2023
Completion of greenhouse gas inventory for Scope 3 emissions categories,
including: business travel, employee commuting and purchased goods and
services. This data will be used to create an improved understanding of our Scope
3 emissions and allow us to create emission reduction targets and goals for Scope
3 categories.
Apr-23
Publication of Everest’s supplemental Corporate Responsibility Report disclosures,
available at:
https://www.everestre.com/Corporate-Responsibility
2023-24
Continue to design investment, underwriting and product development strategies
to incorporate ESG and climate-related risks and opportunities into our core
business operations.
2023-
24
Invest in initiatives and resources for professional development to arm our people
with next-generation skills, promotive innovation and support a talented, diverse
workforce.
ESG
4
2023 Proxy Statement
Everest
currently
aligns
its
ESG
disclosures
and
initiatives
with
the
following
five
leading
frameworks:
Global Reporting
Initiative (“GRI”)
Standards
The GRI standards are one of the most widely adopted and globally recognized
standards for sustainability reporting.
Sustainability
Accounting
Standards Board
(“SASB”)
SASB publishes a set of standards for 77 different industries (including
insurance), which identify the minimal set of financially material sustainability
topics and their associated metrics for a typical company in a given industry.
Task Force on
Climate-related
Financial Disclosures
(“TCFD”)
The TCFD was set up by the Financial Stability Board of the G20 to develop
recommendations for companies to use when disclosing climate-related risks and
opportunities to their stakeholders.
Principles for
Responsible
Investment (“PRI”)
The UN-supported PRI is a global leading proponent of responsible investment,
with over 5,000 signatories representing more than U.S. $120 trillion in AUM.
Principles for
Sustainable Insurance
(“PSI”)
Endorsed by the UN Secretary-General, these principles have led to the largest
collaborative initiative between the UN and the insurance industry.
We encourage you to go to our website and review our Corporate Responsibility Reports and associated disclosures.
Our comprehensive Corporate Responsibility Report is released on a two-year update cycle; however, we produce
supplemental reports and actively update our stakeholders in real-time during the year to highlight key milestone
accomplishments in climate risk reporting, diversity and inclusion initiatives and community outreach.
We reported under the TCFD framework for the first time in 2022. The TCFD was developed to implement more
effective
climate-related
disclosures
to
enable
stakeholders
to
understand
the
concentration
of
carbon-related
assets
in
the financial sector and the financial system’s exposures to climate -related risks. The TCFD is structured around four
disclosure areas: 1) governance, 2) strategy, 3) risk management and 4) climate-related metrics. Many of the TCFD
recommended disclosures are consistent with our prior disclosures under the GRI and SASB frameworks. Additionally,
our
TCFD disclosures include Scope 3 emissions categories demonstrating our commitment to considering climate issues
in our business strategy and operations.
Moreover, Everest is a signatory to the PSI, a global sustainability framework of the United Nations Environment
Programme’s Finance Initiative. The PSI serves as a global framework for the insurance industry to better understand,
prevent and reduce ESG risks and better manage opportunities to provide quality and reliable risk protection. The
PSI has led to the largest collaboration between the UN and the insurance industry. More than 200 organizations
have now joined the PSI, representing about one-third of world premium volume.
3
Signatories of the PSI pledge to
focus on embedding ESG into company strategy and risk management procedures, as well as working with clients,
suppliers, regulators, governments and other key stakeholders to build awareness and drive action on ESG issues.
Finally, as a signatory to the PRI, the world’s leading proponent of responsible investment, we continue to refine our
investment guidelines to comport with the aim of the PRI. As a result, nearly 85% of Everest’s total assets are managed
by other PRI members, including approximately 95% of its fixed-income assets, which comprise the majority of the
Company’s investment portfolio.
Corporate Governance Profile and Compensation Best Practices
We operate our business consistent with sound corporate practices and strong corporate governance that promote
the long-term interests of our shareholders, strengthen the accountability of the Board and management and help
build trust in the Company. Our Board encourages and reviews management performance in the context of business
practices that emphasize sustainability and best-in-class corporate governance. Our philosophy has always been to
generate long-term value for our shareholders. This emphasis is reflected in our compensation philosophy, enterprise
risk management and business model. We further recognize the potential impact of such exogenous threats as climate
change and natural resource depletion and strive to incorporate such risks, to the extent they can be quantified, into
our
risk management profile to preserve the sustainability of our business.
3
Information is latest available from https://www.unepfi.org/insurance/insurance.
ESG
2023 Proxy Statement
5
The Board adheres to the Company’s Corporate Governance Guidelines and Ethics Guidelines and Index to
Compliance Policies, which are available on the Company’s website at http://www.everestre.com. The Board also
aims to meet or exceed, where applicable, the corporate governance standards established by the New York Stock
Exchange (“NYSE”). The Board regularly reviews the Company’s corporate governance policies and procedures to
identify areas for improvement reflecting evolving best practices raised by our shareholders. In addition, as set forth
in more detail in this Proxy Statement in the section entitled “Compensation Discussion and Analysis,” the Board
strives to respond to shareholder concerns regarding compensation practices from a governance perspective.
Diversity, Equity and Inclusion
Our strength and success derive from our diversity, and we are at our best when we embrace diverse views and
perspectives. Equality in opportunity, career development, compensation and respect for all individuals are
fundamental human rights that are at the forefront of our culture and promoted within our workplace. In 2022, we
identified new ways to expand and mature in the diversity, equity and inclusion (“DEI”) space. We approach DEI as
a consistent, dedicated effort to create a lasting positive impact on our colleagues, clients and the communities we
serve across the globe.
Our Board is committed to diversity within its structure as well as emphasizing its importance in our senior executive
leadership. We believe that diversity in gender, age, ethnicity and skill set allows for dynamic and evolving perspectives
in governance, strategy, corporate responsibility, human rights and risk management. We have three highly respected
women as members of our Board with proven leadership experience.
Ms. Gerri Losquadro serves as Chair of the Board’s Risk Committee, which establishes and monitors the Company’s
group-wide risk management principles, including underwriting, reserve analysis and risk appetite levels. Ms. Meryl
Hartzband serves as Chair of the Board’s Audit Committee. The Company also appointed Ms. Hazel McNeilage as an
independent, non-executive member of the Board in November 2022.
Proactive diversity recruitment is integral to succession planning at both the board level and throughout all levels of
the organization. Our Talent Development team works with senior management to identify diverse talent across the
Company as potential leaders. These individuals are provided management and executive leadership training and
education to enhance their skill sets and provide opportunities for advancement.
Our DEI Council brings focused attention and awareness of social justice reforms across the organization and society.
Over the past year, our council members have helped shape and drive various initiatives and programs that continue
to broaden people’s perceptions, foster a deeper understanding of different cultures and encourage our employees
to become involved in employee-led initiatives that connect colleagues and provide opportunities to serve in their
communities.
The work of the DEI Council has helped enhance the employee experience for all of our colleagues across the
organization worldwide. The Council encourages continuous and open dialogue between executive and senior
management and traditionally underrepresented groups at all levels, without fear of reprisal or retaliation, to identify
areas of improvement and carry out the message of inclusion both inside and outside our organization. Among the
key actions led by the DEI Council in 2022 were forming and supporting additional Employee Resource Groups
(“ERGs”), developing a regional representation network and leveraging specific talent development and talent
acquisition initiatives that will positively influence the composition of our workforce.
Increasing Cultural
Intelligence &
Bias Awareness
Training
Cultural intelligence refers to the ability to relate and function effectively in culturally
diverse settings. We have helped to increase cultural intelligence through the
development and enhancement of our employee resources. This includes DEI
education and tools made available through bias awareness and reduction training
offered through Blue Ocean Brain – our interactive and immersive online learning
platform. In addition, bias awareness and reduction content has been incorporated
across existing Everest development programs.
Everest employees completed over 16,000 hours of digital learning in 2022, through
a variety of means, including LinkedIn Learning, The Institutes, Workday and Blue
Ocean Brain. 3,827 hours of this learning was dedicated to compliance courses,
including harassment prevention and enterprise risk management.
Harassment
Prevention Training
Everest conducts annual harassment training. Everest expanded its mandatory
Harassment
Prevention
international branch offices.
ESG
6
2023 Proxy Statement
Everest-NJ LEEP
Partnership
15 Everest employees volunteered for NJ LEEP’s annual industry “Week- on-the-
Job” event which serves low-income and first-generation students. The program
offers 10th grade students real-world experience working in corporations, law
firms and government offices, enabling them to discover new areas of interest
and career possibilities. Everest hosted five students and offered them
opportunities to join several Everest-led technical, professional and development
workshops.
Diversity
Considerations
for Mentorship
Program
Employee participation in the Everest mentorship program continues to expand
as new colleagues join the Everest team and utilize the program to encourage
diverse participation across the company. The DEI Council, through its ERGs,
took advantage of the mentorship program in proactively matching under-
represented mentees with senior and executive level managers as mentors for
underrepresented colleagues.
Management
Training,
Leadership
Programs and
Networking
Our management and leadership training programs have been revised to include
bias awareness and reduction education. We have piloted leadership
development programs focused on underrepresented groups, which are now
under consideration for incorporation into the leadership development
curriculum. There has also been a focus on developing networking opportunities
for underrepresented colleagues to have more frequent and direct access to
senior management.
Everest employees completed 14,921 hours of instructor-led, skills-based training
in 2022 (approximately 6.25 hours of instructor-led training per employee).
Employee
Resource Groups
Everest supports our employees through several ERGs, including the Black ERG,
Latino ERG, LGBTQ+ ERG, Pan-Asian ERG, Women’s Networking Group and Everest
Charitable Outreach. We also introduced the Rising Professionals Group in 2022.
These ERGs leverage networking events and professional development
opportunities and promote cultural traditions and awareness at Everest.
These ERGs carried out various successful events and programs in 2022, including
celebrations of Women’s History, Hispanic Heritage, Pride Awareness and Black
History Months; the Pan-Asian World Showcase; leadership coffee hours and fireside
chats; community involvement events, offering colleagues the opportunity to
support businesses in underrepresented communities; and strategic sponsorship
events. Everest’s U.S. offices are now also closed in honor of Juneteenth, also known
as “Freedom Day,” to commemorate the effective end of slavery in the U.S.
This year, 1,223 Everest employees participated in at least one of the 77 events held
by our ERGs, totaling over 3,971 hours of employee engagement in corporate
sponsored events.
Awards
Inside P&C Honors awarded Everest with its Diversity & Inclusion Award, which
recognizes a company in the industry committed to furthering inclusion and
diversity by actively improving the opportunities and advancement of inclusivity
and socio-economic diversity.
Industry Support
Everest is supportive of a variety of initiatives to advance DEI efforts, including
sponsoring conferences by the National African American Insurance Association
and the International Association of Black Actuaries, as well as the Dive In
Festival, a leading insurance industry event for advancing DEI in all forms.
Everest also recently became a founding sponsor of the Network of Actuarial
Women and Allies, whose mission is to connect and empower women of all
backgrounds, races, ethnicities and life circumstances so they can be successful
in the actuarial profession.
ESG
2023 Proxy Statement
7
Training
and
Development
Cybersecurity
In October 2022, Everest held its inaugural Cybersecurity Awareness Month. As part of
this initiative, we held mandatory,
company-wide training to teach colleagues to be vigilant in spotting red flags in the office, as well as digital space. We
also launched a new Cyber Corner with an easy-to-access portal on our internal company website. This educational
hub is an accessible repository of regular news, tips and information to ensure that cyber risk prevention is top-of-mind
for our employees, and that we all have the resources we need to protect Everest against cyber threats.
Corporate Responsibility and Sustainability
We believe that our future is determined by our actions taken today that go beyond just business strategy and also
incorporate the values important to our employees and the communities in which we operate, including providing
a diverse and inclusive work environment that offers employees the opportunity to further their development,
supporting our communities through the donation of time and financial resources and working with our clients
and customers toward finding environmentally sustainable solutions to the adverse impacts of climate change and
maintaining our integrity across all aspects of the Company.
Further details of our progress in the areas of diversity, pay equity, talent development and ESG can be found in our
second Corporate Responsibility Report which we published in April 2022 in compliance with the GRI framework.
Our 2022 supplemental disclosures were also published in April 2023 with updated data. We invite shareholders to
carefully review these reports which are available at http://www.everestre.com/Corporate -Responsibility and welcome
feedback on our progress and the reports. The Company also included additional climate-related disclosures in
alignment with the TCFD recommendations within its 2022 supplemental Corporate Responsibility Report.
Community Outreach & Volunteer Work
Everest Charitable Outreach
As responsible corporate citizens, we believe strongly in the importance of advocating for change, giving back
to global communities and helping those less fortunate. Our mission is to support education, health, social and
environmental issues that impact our neighbors. This is why we founded Everest Charitable Outreach (“ECO”). ECO
is a community service organization sponsored by the Company that coordinates employees to work with charities
in the local communities where we operate. Through ECO, we partner with organizations that use their funds directly
their causes with limited overhead expense. We endeavor to assure that at least 80% of the Company’s financial
donations to each of our partner organizations goes directly to the community endeavors being supported. But
donation of time is more important to ECO than financial support.
The cornerstone of ECO’s community outreach efforts involves working closely with our local offices around the
globe in developing programs that encourage active employee participation in a variety of events within their local
communities and neighborhoods. In furtherance of this goal, we were proud to support over 450 of our employees
committing 1,350 volunteer hours in 2022 to support a range of charitable causes, including:
RARITAN HABITAT
FOR HUMANITY
Everest employees from our New Jersey and New York offices volunteered with
Raritan Valley Habitat for Humanity to assemble benches for a community
garden in Flemington, New Jersey, as part of a larger civic revitalization project.
GROW-A-ROW
Employees volunteered with Grow-a-Row to glean apples to be distributed to those
struggling with food insecurity and would otherwise be unable to buy fresh produce
for themselves. The group gleaned 3,150 pounds of apples, which will provide about
12,600 servings. The apples picked were sent to a community food bank truck,
bound for one of Grow-A-Row’s hunger relief partner organizations such as the
Community Foodbank of New Jersey, City Harvest in New York City, Philabundance in
Philadelphia, the Mid-Atlantic Regional Cooperative and at free farmers markets in
Camden, Jersey City, East Orange, Newark, Morristown and Trenton, New Jersey and
Philadelphia, Pennsylvania.
On another occasion, Everest volunteered with Grow-A-Row for a peach tree thinning
event. Tree thinning is an important agricultural practice that improves trees’ growth
rates, health and ability to yield high-quality produce.
ESG
8
2023 Proxy Statement
CAMP JOTONI
Camp Jotoni is a special needs summer camp for children and adults with
disabilities. 15 of our colleagues participated in a clean-up day to prepare the
facilities, cabins and grounds for the summer sessions.
COVENANT
HOUSE SLEEP
OUT
Everest supported the Covenant House (Re) Insurance Industry Sleep Out event in 2022.
The
Covenant
House aids homeless youth by providing shelter, food, clothing and
essential services such as job training, education, healthcare, mental health counseling and
legal aid. Everest’s team raised $14,830, which included a $10,000 corporate contribution
to Covenant House.
PORT LYMPNE
ANIMAL RESCUE
A team of 35 volunteers from the London Reinsurance team volunteered at Port
Lympne, a local animal reserve and breeding sanctuary for rare and endangered
animals to construct a new Meerkat reserve.
AKHIL AUTISM
FOUNDATION
Nine Everest employees, as well as additional friends and family participated in the
Akhil Autism Foundation 3k/5k walk to raise funds for autism research.
RISE AGAINST
HUNGER
Everest employees across 10 offices volunteered with Rise Against Hunger to pack
72,363 nutritious meals that were distributed to Rise Against Hunger’s partners
throughout the world.
UNITED WAY
TOOLS FOR
SCHOOLS
125 Everest employees donated to United Way’s Tools for Schools program in 2022
to provide much-needed school supplies to students and teachers in local
communities. Employees across 12 offices donated over 1,000 items and we
surpassed our goal of donating $10,000 worth of school supplies.
SOLES4SOULS
New in 2022, U.S. employees can support Soles4Souls on an ongoing basis.
Soles4Souls is a U.S.-based nonprofit that collects unwanted shoes and clothing and
provides them to those in need. Employees are able to donate shoes and clothing to
reduce waste. In 2022, employees donated over 170 pairs of shoes and 190 pieces
of clothing.
Everest Cares
Everest Cares is our global philanthropic program, designed to align a substantial portion of our charitable giving
with three of the United Nations’ 17 Sustainable Development Goals: climate, hunger and justice. These pillars
align with our employees’ passions to create a sense of shared purpose that connects them to the Company, their
community and the world. We recognize the cross-cutting nature of these issues, including the effects of climate
change upon our food supply and the disproportionate impacts of climate change and environmental injustices on
vulnerable communities. Through this program, we intend to demonstrate to our employees, shareholders and the
global community that Everest is more than a promise to pay claims.
We have partnered with charitable organizations that align with the identified pillars. Our Employee Matching Gifts
program is a component of our Everest Cares program and matches employee donations dollar for dollar made
to pre-selected organizations, which focus on our three philanthropic pillars. Overall, including Everest Cares, the
Company and its employees donated approximately $600,000 in 2022 to a range of charitable organizations.
Climate Change and Environmental Conscience
Policy
Climate change is a real and persistent threat. As a global (re)insurance organization, our business involves protecting
our customers from the impact of natural catastrophes and large-scale weather events through insurance and
reinsurance. Insured losses from natural catastrophes have steadily increased on average for the last two decades,
due in large part to human population growth, urbanization, economic development and a higher concentration of
assets in exposed areas, and these losses will be further aggravated by the human impact on climate change.
We recognize the global impact of climate change on extreme natural perils and the fact that insurance is a critical risk
transfer component for economic and social recovery from the effects of
extreme natural catastrophe events. The rise
in
air and sea temperatures is contributing to the increase in both frequency and intensity of extreme weather events.
These
events can become catastrophic for people all around the globe. The devastation caused by disasters like
floods,
droughts, wildfires
and
hurricanes
is
getting
more
and
more
severe
as
the
global
climate
continues
to
change.
ESG
2023 Proxy Statement
9
We have an opportunity and the
responsibility
to manage a risk
environment
made volatile by global
climate
change.
We
recognize that insured losses due to extreme weather events are increasing over time, and that as climate change worsens,
these losses will continue to grow. This is why we employ a data-driven approach to responding to these risks in all aspects
of our business, from modelling, to actuarial and to
underwriting.
We can draw upon not only industry sources of
data,
but also data and information from our own extensive claims and
underwriting
portfolios given Everest’s half-century
of
operating history as a global insurance and reinsurance organization. Our pricing and exposure models strive to quantify
the human impacts of
climate
change to better allow us to price the risk products we sell and how we deploy our risk capital.
We are
committed
to
providing
solutions that help our clients manage the impact of their business on the
environment
and mitigate financial risks associated with exposure to climate change. While the benefit of
risk transfer through insurance
on the global economy is paramount in helping families and entire communities rebuild homes and businesses and
keep people working, we also seek to influence change in behavior to improve the environment and mitigate the human
impact on climate change. To that end, our risk portfolios are expanding to provide broad insurance and reinsurance
protection for renewable energy programs and environmentally sound private and public construction projects. At
the
same time, we look to reduce our capacity and exposure to regions more susceptible to increased severity of climate
change, thereby, proactively curbing the expansion of human activity into environmentally sensitive locations.
We also continue to monitor, control and reduce where possible our own ecological impact, while, remaining pro-
active and forward-looking in a changing climate and weather environment. Among our goals as a Company is to
achieve a zero emissions workplace across all of our offices by 2050.
Addressing climate risk is fundamental to our long-term sustainability. We approach the challenge of climate risk in a
measured, team-oriented fashion leveraging our intellectual capital, historical data and organizational passion. True
to our culture, we identify tactical areas of opportunity in mitigating climate risk across four broad pillars: (1) adhering
to the PRI as a strategic component of our investment portfolio; (2) utilizing our vast (re)insurance experience in
working with the global community to enhance risk protection through our adoption of the Principles for Sustainable
Insurance; (3) providing insurance protection for clean energy programs; and (4) influencing societal behavior to
mitigate climate change risk.
Climate Risk Actions and Initiatives
UN-PRI Signatory
•
Everest continually assesses the impact of climate risks on our investment
portfolio and identifies investment opportunities in the shift to a low-carbon
global economy.
•
We review and update our investment guidelines to reflect the PRI. We also
employ a principles-based investment strategy designed to diversify our
global portfolio by identifying emerging opportunities across various sectors
that contribute long-term value to society. Our investment strategy assumes a
proactive and measured approach in transitioning investment from declining
heavy carbon-emitting industries to eco-friendly and value generating
opportunities including renewable energy, government sponsored green
bonds and public works projects.
•
We review the investment guidelines and actions of our pertinent third-party
asset managers to ensure their compliance with the PRI in the context of the
portfolios that they manage. Our main fixed income asset manager has had
a policy in place since 2019 restricting any further purchase of bonds on
behalf of Everest issued by companies that generate more than 25% of their
revenue from coal. As of year-end 2022, less than $20 million of our fixed
income portfolio is exposed to companies that derive greater than 25% of
their revenue from coal-related businesses, while our public equity portfolio
had approximately $2 million of coal -related exposure, and our private equity
portfolio had less than $100,000 of exposure, which represent a significant
decrease in investment exposures to coal over the past few years.
• Currently, Everest
has invested over $200 million in green bonds, which
are fixed-
income
instruments
specifically
designed
to
fund
projects
with
environmental
and/
or climate or other social benefits. We also hold nearly $20 million of investments
in three ESG-related exchanged-traded funds (“ETFs”) helping enable the
production of renewable energy in various areas of the world.
ESG
10
2023 Proxy Statement
UN-PSI Signatory
• Everest is a
signatory
United Nations Environment Programme’s Finance Initiative.
• The PSI serves as a global framework for the insurance industry to better
understand, prevent and reduce ESG risks and better manage opportunities to
provide quality and reliable risk protection. The PSI has led to the largest
collaboration between the UN and the insurance industry and has steadily
grown to represent over 30% of world premium volume.
• Everest is proud to have already reported initial disclosures in accordance
with the PSI framework, contained within Everest’s recently published
Corporate Responsibility Report, within four months of officially becoming a
signatory to the PSI.
• Going forward, Everest will continue to support the PSI by among other
actions: working with communities to develop insurance solutions to help
transition to renewables; supporting government sponsored green initiative
programs; providing market leading project credit coverages; and providing
coverage to protect against defaults by renewable energy developers.
Providing
Insurance
Protection for
Clean Energy
Programs
As the renewable energy industry rapidly grows, Everest is committed to helping
lead the transition to a clean energy future. McKinsey estimates that by 2026,
global renewable-electricity capacity will rise more than 80 percent from 2020
levels, and by 2035, renewables will generate 60 percent of the world’s
electricity.4 This dramatic growth presents an excellent insurance growth
opportunity, with some recent highlights and initiatives by Everest in this area
listed below:
• Everest insures the International Finance Corporation’s Managed Co-Lending
Portfolio Program (“MCPP”). The MCPP is one of the most successful efforts to
date to connect institutional investors with impact- driven opportunities that
support global development priorities. Insurance company participants use
unfunded structures to provide the MCCP with credit coverage on individual
loans. Everest has supported the funding of the following projects through the
MCCP over the past year:
– Financing climate smart projects in Colombia to mitigate the impacts of climate
change;
– Lending to small and medium-sized enterprises in Nepal to priority sectors of
agriculture and tourism;
– Lending to underserved micro, small and medium-sized enterprises in rural
areas of India with a focus on emission standard compliant vehicles;
– Lending for trade related short-term financing to small and medium-sized
Nigerian enterprises, affected by the COVID-19 pandemic;
– Lending to eligible climate projects to assist a local Kenyan bank meet its target
of greening 25% of its loan portfolio by 2025.
4
See
https://www.mckinsey.com/industries/electric -power-and-natural-gas/our-insights/renewable -energy-development-in-a-net-zero -world
ESG
2023 Proxy Statement
11
• A
growing
to allocating capacity to renewable energy projects, enabling financers to
provide additional credit for renewable energy development. Among other
projects, we have provided credit risk insurance for renewable energy projects,
including solar and wind energy in Brazil, Chile, Colombia, Egypt, Mexico,
Panama, Peru, Senegal, South Africa and Taiwan. For example, in Taiwan,
Everest supported the conversion of a 2GW portfolio of diesel generators to
natural gas and the installation of solar power generation. In Peru, Everest
supported a development finance institution’s construction of a 300MW wind
farm.
•
• A growing percentage of our excess casualty energy portfolio is comprised of
electric power generation from clean energy sources. Recent
examples
providing capacity to Vineyard Wind in connection with a significant off-shore
wind project development on the outer continental shelf south of Massachusetts
which will be among the first utility-scale offshore wind energy projects in the
U.S., as well as providing capacity to SOLV Energy, a leading solar services
provider serving the utility, high voltage and energy storage markets in North
America, which has helped build over 8GW of solar energy projects since 2008.
• In 2022, Everest began providing reinsurance support for Marsh’s new hydrogen
facility, a first-of-its-kind insurance and reinsurance facility
that
dedicated insurance capacity for new and existing green and blue hydrogen
energy projects globally. Energy operators have found it particularly challenging
to secure adequate insurance for these new and emerging technologies;
however, Marsh’s facility will support the scale-up of the clean hydrogen
industry and expedite the transition to renewable energy.
•
Everest
provides insurance coverage for companies developing breakthrough
technologies, including fuel cells, energy storage, carbon capture, renewable
fuels and waste-to-energy solutions. This coverage helps project developers
access capital to accelerate the deployment of these technologies to address
global challenges.
• We also provide reinsurance support for the Clean Energy Risk
Solutions
program, which provides performance warranties for renewable energy
projects and enables debt financing. This protects the development and global
distribution of clean energy technologies that deliver value to the renewable
energy markets, including solar, waste-to-energy and energy storage.
• We
partnered
insurance company, to offer an array of property and casualty products
designed for the renewable energy industry, including solar energy, battery
storage facilities and wind assets.
• Everest Insurance® has partnered with one of the largest
underwriters
renewable energy projects in North America to provide property coverages for
wind and solar energy facilities.
• Everest has written an expanding amount of tax liability insurance coverage in recent
years,
which
investment
renewable energy projects and can potentially mean the difference between a project
receiving sufficient investment and commencing start-up or not. We expect further
opportunities in this area as governments encourage the growth of the renewable
energy sector.
ESG
12
2023 Proxy Statement
Supporting a
More Sustainable
Economy
Everest is also supporting the development of innovative technologies through loan
guarantees which will help support the transition to a more sustainable economy. This
includes loan guarantee support for:
• Materials technology platform focused on a recyclable, biodegradable and marine -safe
packaging applications and solutions to solve the difficulties of processing polymer
polyvinyl alcohol, expand the use of sustainable plastic and facilitate the circular
economy;
• Biotech company with global operations supporting sustainable tailings management by
extracting valuable minerals currently discarded from mining operations which results
in reduced mineral waste and a new source of recycled water;
• Biotech company offering a variety of solutions, including consumer products to replace
toxic chemicals in household, personal care and industrial products; technologies that
make the oil and gas industry more sustainable; and organic and biorational soil
technology to improve farmer profits and soil health, with the benefits of carbon
sequestration and reduced nitrous oxide emissions.
Influencing
Societal Behavior
to Mitigate Climate
Change Risk
• We also seek to influence change in behavior to improve the environment and
mitigate
• We have reduced our capacity and exposure to regions more susceptible to
increased
expansion of human activity into environmentally sensitive locations.
• We work with our insureds to consider the impact of climate risk on their
operations
mitigation services we provide.
• We provide insurance premium credits to policyholders that demonstrate sound
environmental
facilities and operations as an economic incentive to reduce their exposure to
risk of loss associated with climate change.
Memberships and Affiliations
The Company is active in various affiliations and memberships in supporting our customers and clients in the transition
from a carbon economy to renewables. For example, Everest has been a long-time active and contributing member
of the Reinsurance Association of America (“RAA”), whose advocacy work includes efforts to identify ways the (re)
insurance sector can minimize the effects of climate change along with a commitment to work with policymakers,
regulators and the scientific, academic and business communities to assist in promoting awareness and understanding
of the risks associated with climate change. The Company’s participation in the RAA includes membership on the
RAA’s Extreme Events Committee that focuses on catastrophe modeling improvements to reflect climate change.
The
RAA’s
statement
on
climate
change
policy
is
located
at:
www.reinsurance.org/Advocacy/RAA_Policy_Statements.
As noted above, Everest is also a signatory to the PRI and has been incorporating ESG principles into our investment
guidelines and decisions in accordance with the PRI. The PRI is the world’s leading proponent of responsible
investment, with over 5,000 signatories representing more than US$120 trillion in assets under management as
of November 2022. The PRI defines responsible investment as a strategy and practice to incorporate ESG factors
into investment decisions and active ownership. The PRI is a part of the United Nations Environment Programme’s
Financial Initiative.
Finally, Everest is one of the few Bermuda or North American-based insurance sector companies to sign on to the
PSI,
which ensures better management of ESG issues and strengthens the insurance industry’s contribution to building
a resilient, inclusive and sustainable society. Everest’s commitment to the PSI reflects our recognition of the impact
of climate change on the global environment and our stated goal of achieving a zero-emissions workplace across all
global offices by 2050.
ESG
2023 Proxy Statement
13
Risk Management Profile
We also strive to incorporate environmental risks, to the extent they can be quantified, into our risk management
profile. We have a highly developed Enterprise Risk Management (“ERM”) practice that identifies key risks that the
Company is exposed to and establishes tolerance levels and mitigation strategies to preserve the sustainability of
our business. Environmental risks, including those directly related to climate change, feature prominently in the
Company’s ERM goals.
We have established a robust risk management process to identify, research, assess and address various business
risks. As a (re)insurance company, we are at the forefront of identifying and limiting climate change risks. We are
exposed to climate-related risks on both sides of the balance sheet – as risk carriers, as well as institutional investors.
Everest closely monitors the risks posed by climate change, including physical and transition related risks which may
result in short, medium and long-term impacts to insurance and reinsurance organizations. Everest acknowledges the
transition risks related to climate change, including political, regulatory, technology and reputational risks. Everest’s
underwriting and investment strategies consider the transition risks, including through enhancing renewable energy
coverage and limiting fossil fuel investments.
A key component of our ERM framework is the implementation of a new Integrated Risk Management (IRM) tool
to help us establish a thorough register of all enterprise risks, formalize our process for managing risks, increase
cooperation among colleagues and escalate relevant risks. Most importantly, the IRM tool will help us build consensus
about the initiatives required to mitigate negative effects should any of these risks materialize. There are two core
components of this system – Risk Lifecycle and Risk Events:
•
Risk Lifecycle
—this component pertains to identifying, analyzing, assessing and monitoring risks. Also, included in this
component is an area to capture current controls and future plans around the identified risks. The Risk Lifecycle
currently being rolled out across the organization.
•
Risk Events
—this component will allow for reporting of an event or situation that can impact the organization. The
Risk
Events component is scheduled to be rolled out in the first half of 2023.
Operations
Everest is also cognizant of physical climate risks when making operational decisions to ensure our infrastructure
can adapt to the impacts of climate change. While Everest, as a (re)insurance organization, has a modest ecological
footprint, the Company nonetheless strives to maintain an environmental consciousness in its operations as part of
its stance toward environmental policy. For instance, in light of expanding office space requirements occasioned by
growth, Everest is focused on office properties that exhibit positive environmental features:
Location
ESG Features
Warren, New Jersey (U.S. Headquarters)
• LEED Silver certified
• Green roof
• Charging stations for electric vehicles
• Natural light-maximizing workspaces
Hamilton, Bermuda (Corporate Headquarters)
• Double-glazed solar controlled glass
• Seawater air conditioning system
• Energy-conserving lighting
Chicago, IL
• LEED Gold certified
Houston, TX
• LEED Gold certified
Los Angeles, CA
• LEED Platinum certified
New York, NY
• LEED Gold certified
San Francisco, CA
• LEED Platinum certified
Tampa, FL
• LEED Gold certified
Walnut Creek, CA
• LEED Gold certified
ESG
14
2023 Proxy Statement
Everest also promotes flex hours and a work-from-home policy to help reduce traffic congestion at any given office
location at any given point in time. We also incorporate a paperless claims processing system designed to significantly
reduce the need for printing hard copies of claims files. In addition, we are proud that Everest received the United Way
of Northern New Jersey Impact Award for its recently opened U.S. headquarters, which is given for a real estate project
considered to have had the most positive impact in northern New Jersey during a given year.
Underwriting and Environmental Solutions & Practices
The Company continuously researches external and internal data to assess and refine our pricing, modeling and
underwriting practices related to climate risks. We recognize that over an extended period of time, sustained shifts in
atmospheric and climate dynamics could give rise to increased probability and severity of extreme events. To meet
this challenge, our underwriting, actuarial, ERM, claims and catastrophe
modeling teams work in unison to research and analyze external raw
climate and meteorological data in conjunction with our internal claims and
loss information data to assess geographical impacts of climate change
and develop predictive analytics models to improve pricing, product
development and claims management. In order to timely respond to
changing circumstances that may impact areas of Everest’s business and
ensure that the Company’s senior executive management and Board are
up-to-date, our climate risk monitoring structure promotes identification
and reporting of climate risks throughout the year as shown in the chart to
the right.
Everest has also been at the forefront in continuing to develop advanced
insurance solutions and products related to environmental risk for our
clients, including coverages for specialized environmental contractors
as well as industrial and commercial component manufacturers. Our loss
control teams work with our clients and policyholders in these industries
to develop and implement loss prevention practices, promote worker safety at their facilities and integrate the latest
environmentally sustainable materials and practices at their locations. In recent years, Everest has also been an
increasingly active supporter of renewable energy transactions through structured credit insurance, including wind
farm projects, in various locations around in the world.
Shareholder Feedback
•
We are committed to ensuring that we understand our
shareholders’ issues and potential concerns, and that our
shareholders understand our corporate governance and
executive compensation programs. This includes how our
executive compensation program rewards the achievement of
our strategic objectives and aligns the interests of our Named
Executive Officers with those of the Company’s shareholders.
• Overall, our shareholders expressed support for our long-term
strategy, Investor Day and ESG initiatives. There was universal
appreciation for the opportunity to engage in the outreach
discussions and our willingness to consider shareholder input
into our governance protocols.
We have reached out to
shareholders totaling approximately
ESG
2023 Proxy Statement
15
Highlights of our corporate governance and compensation best practices include:
Governance Profile Best Practice
Company Practice
ü
⬝⬝
Size of Board
9
ü
⬝⬝
Number of Independent Directors
7
ü
⬝⬝
Board Independence Standards
The Board has adopted director independence
standards stricter than the listing standards of the
NYSE.
ü
⬝⬝
Director Independence on Key Committees
The Board's Audit, Compensation and Nominating
and Governance Committees are composed
entirely of independent directors.
ü
⬝⬝
Separate Chairman and CEO
Yes
ü
⬝⬝
Independent Lead Director
Yes
ü
⬝⬝
Annual Election of All Directors
Yes
ü
⬝⬝
Majority Voting for Directors
Yes
ü
⬝⬝
Board Meeting Attendance
Each director or appointed alternate director
attended 100% of Board meetings in 2022.
ü
⬝⬝
Annual General Meeting Attendance
Director attendance is expected at the Annual
General Meeting per Governance Guidelines, and
100% of directors attended the 2022 Annual
General Meeting.
ü
⬝⬝
No Over-Boarding
Directors are prohibited from sitting on the boards
of competitors.
ü
⬝⬝
Regular Executive Sessions of
Non-Management Directors
Yes
ü
⬝⬝
Shareholder Access
No minimum share ownership or holding
thresholds is necessary to nominate qualified
director to Board.
ü
⬝⬝
Policy Prohibiting Insider Pledging or
Hedging of Company’s Stock
Yes
ü
⬝⬝
Annual Equity Grant to Non-Employee
Directors
Yes
ü
⬝⬝
Annual Board and Individual Director
Performance Evaluations
Yes
ü
⬝⬝
Clawback Policy
Clawback Policy covers current and former
employees, including Named Executive Officers,
providing for forfeiture and repayment of any
incentive-based compensation granted or paid to
an individual during the period in which he or she
engaged in material willful misconduct including,
but not limited to fraudulent misconduct.
ü
⬝⬝
Code of Business Conduct and Ethics for
Directors and Executive Officers
Yes
ü
⬝⬝
No Separate Change in Control Agreement
for the CEO
CEO participates in the Senior Executive Change in
Control Plan (“CIC Plan”) along with the other Named
Executive Officers.
ESG
16
2023 Proxy Statement
Governance Profile Best Practice
Company Practice
ü
⬝⬝
Double Trigger for Change-in-Control
Yes
ü
⬝⬝
No Excise Tax Assistance
No “gross-up” payments by the Company of any
“golden parachute” excise taxes upon a change-in-
control
ü
⬝⬝
Say on Pay Frequency
Say on Pay Advisory Vote considered by
Shareholders annually
ü
⬝⬝
No Re-pricing of Options and SARs
The Board adheres to a strict policy of no re-
pricing of Options and SARs.
ü
⬝⬝
Minimum Vesting Period of Options and
Restricted Shares
Minimum one-year vesting period for equity
awards
However, the Board has always instituted a five-
year vesting period for equity awards to executive
officers except for performance shares which must
meet key performance metrics over the course of
three years prior to settlement.
Three-year vesting period for equity awards to
Directors
ü
⬝⬝
Share Recycling
No liberal share recycling
ü
⬝⬝
Stock Ownership Guidelines for Executive
Officers
Six times base salary for CEO; three times base
salary for other Named Executive Officers
ü
⬝⬝
Stock Ownership Guidelines for Non-
Management Directors
Five times annual retainer
ü
⬝⬝
Use of Performance Shares as Element of
Long-Term Incentive Compensation
Yes
Voting Matters and Board’s Voting Recommendations
Proposal
Board’s Voting Recommendations
Page
Election of Director Nominees
(Proposal 1)
FOR ALL DIRECTOR NOMINEES
17
Appointment of PricewaterhouseCoopers LLP as
Company Auditor
(Proposal 2)
FOR
87
Non-Binding Advisory Vote on Executive
Compensation
(Proposal 3)
FOR
88
Non-Binding Advisory Vote on Frequency of Vote
on Executive Compensation
(Proposal 4)
FOR 1 YEAR
89
Corporate Name Change
(Proposal 5)
FOR
90
Proposal No. 1—Election of Directors
2023 Proxy Statement
17
PROPOSAL NO. 1—ELECTION OF DIRECTORS
The Board of Directors recommends that you vote FOR the director nominees described below. Proxies will be so
voted unless shareholders specify otherwise in their proxies.
At the 2023 Annual General Meeting, the nominees for director positions are to be elected to serve until the 2024
Annual General Meeting of Shareholders or until their qualified successors are elected or until such director’s office is
otherwise vacated. At its regularly scheduled meeting in February 2023, the Nominating and Governance Committee
recommended to the Board the nominations of John J. Amore, Juan C. Andrade, William F. Galtney, Jr., John A. Graf,
Meryl Hartzband, Gerri Losquadro, Hazel McNeilage, Roger M. Singer and Joseph V. Taranto, all of whom are currently
directors of the Company. The Board accepted the Nominating and Governance Committee recommendations, and
each nominee accepted his or her nomination. It is not expected that any of the nominees will become unavailable
for election as a director, but if any nominee should become unavailable prior to the meeting, proxies will be voted
for such persons as the Board shall recommend, unless the Board reduces the number of directors accordingly. There are
no arrangements or understandings between any director or any nominee for election as a director and any other
person
pursuant to which such person was selected as a director or nominee.
Important Factors in Assessing Board Composition
The Nominating and Governance Committee strives to maintain an engaged, independent Board with broad and
diverse experience, skills and judgment that is committed to representing the long-term interests of our shareholders.
In
evaluating director candidates and considering incumbent directors for nomination to the Board, the Committee
considers each nominee’s character, independence, leadership, financial literacy, personal and professional
accomplishments, industry knowledge and experience.
For incumbent directors, the factors also include attendance and past performance on the Board and its committees.
Each director nominee has a demonstrated record of accomplishment in areas relevant to the Company’s business
and qualifications that contribute to the Board’s ability to effectively function in its oversight role.
The Nominating and Governance Committee seeks current and potential directors who will collectively bring to the
Board a variety of skills, including:
•
Leadership:
Demonstrated ability to hold significant leadership positions and effectively manage complex
organizations is important to evaluating and developing key management talent.
•
Insurance and/or Reinsurance Industry Experience:
Experience in the insurance and/or reinsurance markets is
critical to strategic planning and oversight of our business operations.
•
Risk Management:
Experience in identifying, assessing and managing risks is critical to oversight of current and
emerging organizational and systemic risks in order to inform and adapt the Company’s strategic planning.
•
Regulatory:
Understanding of the laws and regulations that impact our heavily regulated industry, as well as
understanding the impact of government actions and public policy. Both areas are important to oversight of
insurance operations.
•
Finance and Accounting:
Financial experience and literacy are essential for understanding and overseeing our
financial reporting, investment performance and internal controls to ensure transparency and accuracy.
•
Corporate Governance:
Understanding of corporate governance matters is essential to ensuring effective
governance of the Company and protecting shareholder interests.
• Business Operations:
A practical understanding of developing, implementing and assessing our business operations
and processes and experience making strategic decisions, are critical to the oversight of our business, including the
assessment of our operating plan, risk management and long-term sustainability strategy.
•
Information Technology/Cybersecurity:
A practical understanding of information systems and technology use in
our business operations and processes, as well as a recognition of the risk management aspects of cyber risks and
cyber security.
•
International:
Experience and knowledge of global insurance and financial markets is especially important in
understanding and reviewing our business and strategy.
Proposal No. 1—Election of Directors
18
2023 Proxy Statement
In addition to evaluating a candidate’s technical skills relevant to the success of a large, publicly traded company
in today’s business environment, our Board considers additional intangible factors including an understanding of
our business and technology; education and professional background; and geographic, gender, age and ethnic
diversity. Each director must demonstrate critical thinking, clear business ethics, an appreciation for diversity and a
commitment to sustainability. The Nominating and Governance Committee’s objective is to recommend a group that
best perpetuate the success of our business and represent shareholder interests through the exercise of sound
judgment using its diversity of experience and perspectives.
Passing of Board Director John A. Weber
All of us at Everest were deeply saddened by the passing of our dear friend
and colleague John A. Weber. Mr. Weber was elected to the Everest Board in
2003, serving as Chairman of the Investment Policy Committee for 18 years,
and having most recently served on the following Committees in 2022: Audit,
Compensation, Executive, Investment Policy and Nominating and Governance.
Mr. Weber also served as a director of the Company’s Bermuda operating
subsidiaries Everest Reinsurance (Bermuda), Ltd. and Everest International
Reinsurance, Ltd. Mr. Weber’s contributions to Everest over the past two
decades have been instrumental to Everest’s growth, strategic evolution and
results. Mr. Weber was valued not only for his financial and investment insights
as the Chair of the Investment Policy Committee, but also his compassion and
humility as a leader. Everest is a better company in all respects as a result of
Mr. Weber’s service. He will be sincerely missed, and the Company is privileged
to have had the benefit of such a deeply committed Board member.
Proposal No. 1—Election of Directors
2023 Proxy Statement
19
Information Concerning Director Nominees
Each nominee’s biography below includes a summary of the key skills and experience of such nominee that contribute
to the director’s ability to effectively oversee the Company and act in the long-term best interests of shareholders.
JOHN J. AMORE
Age: 74
Director Since: September 19, 2012 Independent
Committees:
•
Audit
•
Compensation (Chairman)
•
Nominating and Governance
•
Risk
Qualifications and Skills:
• Executive
• Insurance/Reinsurance
Industry
Experience
•
Finance and Accounting
•
Corporate Governance
• Business
•
International
• Risk
Management
•
Claims
Background:
Mr. Amore retired as a member of the Group Executive Committee of Zurich Financial Services Group, now known as
Zurich Insurance Group, Ltd., in 2010, for which he continued to act as a consultant through 2012. From 2004 through
2010, he served as CEO of the Global General Insurance business segment after having served as CEO of the Zurich
North America Corporate business division from 2001 through 2004. He became CEO of Zurich U.S. in 2000, having
previously served as CEO of the Zurich U.S. Specialties business unit. Before joining Zurich in 1992, he was vice
chairman of Commerce and Industry Insurance Company, a subsidiary of American International Group, Inc. (“AIG”).
Mr. Amore served as a delegate for the Geneva Association and is an Overseer Emeritus of the Board of Overseers
for the School of Risk Management, Insurance and Actuarial Science at St. John’s University in New York. He is also a
member of the Board of Directors of the W. F. Casey Foundation, Brooklyn, New York and the Board of Trustees and
Finance, Audit and Investment Committees of Embry-Riddle Aeronautical University.
Proposal No. 1—Election of Directors
20
2023 Proxy Statement
JUAN C. ANDRADE, CEO & PRESIDENT
Age: 57
Director Since: February 26, 2020 Non-Independent
Committees:
• Investment
Policy
•
Risk
•
Executive
Qualifications and Skills:
• Executive
• Corporate Governance
• Insurance/Reinsurance
Industry
Experience
• International
• Finance and Accounting
•
Risk
Management
• Business
•
Regulatory
• Mergers and Acquisitions
•
Claims
•
Marketing and Branding
Background:
Juan C. Andrade is President and Chief Executive Officer of Everest Re Group, Ltd., a leading global provider of
reinsurance and insurance solutions.
Juan has close to 30 years of experience in the insurance industry, successfully leading large and complex domestic
and international businesses. He has served in executive leadership roles in underwriting, product development and
innovation, claims, sales and distribution, strategy development and general management.
Juan joined Everest from Chubb where he was responsible for their general insurance business in more than 50
countries outside of North America. Before commencing his insurance career, Juan worked in national security and
international
affairs
within
the
U.S.
Federal
Government’s
Executive
Branch
and
The
Executive
Office
of
the
President.
Juan serves on the Board of Directors of USAA, a leading provider of insurance, investing and banking solutions to
members of the U.S. military, veterans and their families. He was recently recognized by Latino Leaders Magazine
for his service and contributions to USAA. Juan serves on the Board of Overseers of the St. John’s University School
of Risk Management, Insurance and Actuarial Science. Juan is a member of the Board of Trustees of The Institutes,
an organization committed to meeting the evolving professional development needs of the risk management
and insurance community. He also serves on the Board of Directors of the American Property Casualty Insurance
Association (APCIA), the primary national trade association for the insurance industry. Juan is a member of the Geneva
Association, the only international association of insurance companies and the think tank for the global insurance
industry. Geneva Association members protect 2.6 billion people worldwide and manage over $21 trillion in assets.
He is also a member of The Wall Street Journal’s CEO Council, an exclusive invitation-only group of the world’s
leading CEOs and influential global business leaders.
Juan received a Bachelor of Science degree in Journalism with a minor in Political Science from the University of
Florida and was honored as a Distinguished Alumni in 2018. Juan was also inducted into the University of Florida
College of Journalism and Communications Hall of Fame in 2021. This honor recognizes alumni who have excelled
in their careers and has only been awarded to 165 individuals since inception in 1970. He serves on the University of
Florida Foundation National Board.
He also holds a Master of Arts degree in International Economics and Latin American Studies from the Johns Hopkins
University School of Advanced International Studies.
Proposal No. 1—Election of Directors
2023 Proxy Statement
21
WILLIAM GALTNEY
Age: 70
Director Since: March 12, 1996 Independent
Committees:
•
Audit
•
Compensation
•
Executive
•
Nominating and Governance (Chairman)
•
Risk
a
Qualifications and Skills:
• Executive
• Insurance/Reinsurance
Industry
Experience
•
Finance and Accounting
•
Investments
•
Merger & Acquisition
•
Corporate Governance
• Business
• Risk
Management
•
Claims
•
Marketing and Branding
Background:
Mr. Galtney served as a director of Everest Re from March 1996 to February 2000. Thereafter he became a director
of the Company upon the restructuring of Everest Holdings. Since April 1, 2005 he has been President and CEO of
Galtney Group, Inc. Prior thereto, he was President (from June 2001 until December 31, 2004) and Chairman (until
March 31, 2005) of Gallagher Healthcare Insurance Services, Inc. (“GHIS”), a wholly-owned subsidiary of Arthur J.
Gallagher & Co. (“Gallagher”). From 1983 until its acquisition by Gallagher in June 2001, Mr. Galtney was the Chairman
and Chief Executive Officer of Healthcare Insurance Services, Inc. (predecessor to GHIS), a managing general and
surplus lines agency previously indirectly owned by The Galtney Group, Inc.
Proposal No. 1—Election of Directors
22
2023 Proxy Statement
JOHN A. GRAF
Age: 63
Director Since: May 18, 2016 Independent
Committees
:
• Audit
• Compensation
• Nominating and Governance
• Investment Policy (Chairman)
Qualifications and Skills:
• Executive
• Insurance/Reinsurance
Industry
Experience
•
Corporate Governance
• Risk
Management
•
Finance and Accounting
•
Investments
•
International
• Business
•
Regulatory
Background:
Mr. Graf serves as the Non-Executive Vice Chairman of Global Atlantic Financial Group (“Global Atlantic”) and joined
the Board of Directors upon Global Atlantic’s acquisition of Forethought Financial Group (“Forethought Financial”)
in 2014. He served as Chairman and CEO of Forethought Financial from 2006 to 2014. He serves on the Audit,
Risk and Compliance Committees of Global Atlantic. Until December 2015, he served as a non-executive director
of QBE Insurance Group Limited where he chaired the Investment and Personnel Committees. In 2005, he served
as Chairman, CEO and President of AXA Financial, Inc. where he also served as Vice Chairman of the Board and
President and Chief Operating Officer of its subsidiaries, AXA Equitable Life Insurance Company and MONY Life
Insurance
Company. From
2001
through
2004
he
was
the
Executive Vice
President
of
Retirement
Savings, AIG
as
well
as
serving as Vice Chairman and member of the Board of Directors of AIG SunAmerica following AIG’s acquisition of
American General Corporation in 2001, where he served as Vice-Chairman.
Proposal No. 1—Election of Directors
2023 Proxy Statement
23
MERYL HARTZBAND
Age: 68
Director Since: May 23, 2019 Independent
Committees:
• Audit (Chairwoman)
• Compensation
• Investment Policy
• Nominating and Governance
Qualifications and Skills:
• Executive
• Insurance/Reinsurance
Industry
Experience
•
Finance and Accounting
•
Investments
•
Merger & Acquisition
•
Corporate Governance
• Business
• Risk
Management
Background:
Ms. Hartzband retired in 2015 as a founding partner of Stone Point Capital, where she also served as the firm’s Chief
Investment Officer. Additionally, from 1982 to 1999, she served as Managing Director at J.P. Morgan & Co., specializing
in private equity investments in the financial services industry. She currently serves on the Board of Directors at Greenhill
& Co. and Conning Holdings Ltd. She has previously been a director at The Navigators Group, Inc., Travelers Property
Casualty Corp., AXIS Capital Holdings Limited, ACE Limited and numerous portfolio companies of Stone Point.
Proposal No. 1—Election of Directors
24
2023 Proxy Statement
GERRI LOSQUADRO
Age: 72
Director Since: May 14, 2014 Independent
Committees
:
•
Audit
• Compensation
• Nominating and Governance
• Risk (Chairwoman)
Qualifications and Skills:
• Executive
• Insurance/Reinsurance
Industry
Experience
•
Corporate Governance
•
Finance and Accounting
• Risk
Management
• Business
•
International
• Information
Technology/Cyber
Security
•
Claims
Background:
Ms. Losquadro retired in 2012 as Senior Vice President and head of Global Business Services at Marsh & McLennan
Companies, Inc. (“MMC”) and served on the MMC Global Operating Committee. Prior to becoming a senior executive
at MMC, Ms. Losquadro was a Managing Director and senior executive at Guy Carpenter responsible for brokerage of
global reinsurance programs including all insurance lines, treaty and facultative and the development and execution
of Guy Carpenter’s account management program. From 1986 to 1992, Ms. Losquadro held senior leadership
positions at AIG’s American Home Insurance Company and AIG Risk Management. From 1982 to 1986, she served as
Manager of Special Accounts of Zurich Insurance Group.
Proposal No. 1—Election of Directors
2023 Proxy Statement
25
HAZEL MCNEILAGE
Age: 66
Director Since: November 16, 2022 Independent
Committees:
•
Audit
• Compensation
• Nominating and Governance
• Risk
Qualifications and Skills:
• Executive
• Insurance/Reinsurance
Industry
Experience
• International
• Life
Insurance
Industry
Experience
• Information
•
Finance and Accounting
•
Investments
•
Corporate Governance
• Business
• Risk
Management
Background:
Ms. McNeilage was Head of EMEA for Northern Trust’s Asset Management business and served as a member of
the company’s global and international management teams. She held various executive roles in global investment
management at Principal Financial including Global Head of Distribution and Head of International Investments and
she was part of the executive team that successfully navigated the business through the financial crisis. Earlier in her
career, Ms. McNeilage served as Head of Investment Consulting for Asia Pacific with Towers Perrin. She currently
serves on the boards of Reinsurance Group of America and Scholarship America as well as the advisory board of 9th
Gear Technologies. Most recently, she became a director of Alvarium Tiedemann Holdings. Ms. McNeilage is a Fellow
of both the Institute and Faculty of Actuaries (UK) and the Institute of Actuaries of Australia. She earned certificates
from Carnegie Mellon University and Harvard University in cyber security, a certificate from Massachusetts Institute
of Technology in artificial intelligence, and she is a Board Leadership Fellow of the National Association of Corporate
Directors. Ms. McNeilage earned a Bachelor of Science (Hons) degree from the University of Lancaster, England.
Proposal No. 1—Election of Directors
26
2023 Proxy Statement
ROGER M. SINGER, INDEPENDENT LEAD DIRECTOR
Age: 76
Director Since: February 24, 2010 Lead Independent Director
Committees
:
•
• Compensation
• Nominating and Governance
Qualifications and Skills:
• Executive
• Insurance/Reinsurance
Industry
Experience
•
Corporate Governance
•
Finance and Accounting
•
Regulatory
•
International
•
Legal
•
Mergers & Acquisitions
Background:
Mr. Singer was elected as director of Everest Reinsurance (Bermuda), Ltd. (“Bermuda Re”) and Everest International
Reinsurance, Ltd. (“International Re”), both Bermuda subsidiaries of the Company, on January 17, 2012. In 2022,
he was elected as Lead Independent Director of the Company. Mr. Singer, currently retired, was the Senior Vice
President, General Counsel and Secretary to OneBeacon Insurance Group LLC (formerly known as CGU Corporation)
and its predecessors, CGU Corporation and Commercial Union Corporation, from August of 1989 through December
2005. He continued to serve as director and consultant to OneBeacon Insurance Group LLC and its twelve subsidiary
insurance companies through 2006. Mr. Singer served with the Commonwealth of Massachusetts as the Commissioner
of
Insurance from July 1987 through July 1989 and as First Deputy Commissioner of Insurance from February 1985
through July 1987. He has also held various positions in state and federal government, including Assistant Secretary,
Office of Consumer Affairs and Business Regulation, Commonwealth of Massachusetts, Assistant Attorney General,
Office of the Massachusetts Attorney General and Staff Attorney, Federal Trade Commission.
Proposal No. 1—Election of Directors
2023 Proxy Statement
27
JOSEPH V. TARANTO, CHAIRMAN
Age: 74
Director Since: March 12, 1996 Non-Independent
Committees
:
•
Executive
• Investment Policy
Qualifications and Skills:
• Executive
• Insurance/Reinsurance
Industry
Experience
• Business
•
Corporate Governance
•
Finance and Accounting
•
Mergers & Acquisitions
•
Investments
•
Regulatory
•
International
• Risk
Management
•
Marketing and Branding
Background:
Mr. Taranto is a director and Chairman of the Board of the Company, as well as a part-time non-executive employee
of the Company’s affiliate, Everest Global, as of January 1, 2020. He retired on December 31, 2013 as Chief Executive
Officer of the Company and Chief Executive Officer and Chairman of the Board of Everest Holdings and Everest
Re, in which capacity he had served since October 17, 1994. On February 24, 2000, he became Chairman of the
Board and Chief Executive Officer of the Company upon the restructuring of Everest Holdings. Between 1986
and 1994, Mr. Taranto was a director and President of Transatlantic Holdings, Inc. and a director and President of
Transatlantic Reinsurance Company and Putnam Reinsurance Company (both subsidiaries of Transatlantic Holdings,
Inc.). Mr. Taranto was selected to serve on the Board because of his considerable experience as CEO of publicly
traded international insurance and reinsurance companies, intimate knowledge of Everest Re Group, Ltd.’s operations
and
significant insight into the insurance and reinsurance markets.
Proposal No. 1—Election of Directors
28
2023 Proxy Statement
Information Concerning Executive Officers
The following information has been furnished by the Company’s Named Executive Officers who are not also director
nominees. Executive officers are elected by the Board following each Annual General Meeting and serve at the
pleasure of the Board.
MIKE KARMILOWICZ
Age: 54
Mr. Karmilowicz serves as Executive Vice President of the Company and has served as President and CEO of Everest
Insurance® since 2021. He has also served as President of Everest Insurance® North America P&C since January
2020. Mr. Karmilowicz joined Everest Insurance® in July 2015 and served as Senior Vice President of Everest
Insurance® and President of Everest Specialty Underwriters Services, LLC (“ESU”), which comprises the Executive
Solutions Group (Financial Institutions, Public & Private D&O, & Cyber), Professional Liability, Alternative Solutions
(Transactional Liability & Private Equity), Political Risk & Trade Credit and Surety segments. He also held management
responsibility for EverSports & Entertainment Insurance® Inc., Everest’s leading Sports, Entertainment and Leisure
insurance organization. Mr. Karmilowicz has nearly 30 years of experience in the insurance industry, having worked
in increasingly responsible management and underwriting positions at carriers including Zurich and The Hartford.
MARK KOCIANCIC
Age: 53
Mr. Kociancic is the Executive Vice President and Chief Financial Officer of the Company. He is also a Director and
Executive Vice President of Everest Denali Insurance Company (“Everest Denali”), Everest Indemnity Insurance
Company (“Everest Indemnity”), Everest National Insurance Company (“Everest National”), Everest Premier Insurance
Company (“Everest Premier”) and Everest Security Company (“Everest Security”). Mr. Kociancic also serves as a director
International Re, Mt. Logan Re, Ltd. (“Mt. Logan”) and Bermuda Re and as a Director, Executive Vice President, and
Chief Financial Officer of Everest Re. He joined the Company on October 12, 2020, from SCOR, where he most
recently served as Group Chief Financial Officer since 2013. He had previously served in various senior executive
roles with SCOR’s U.S. operations beginning in 2006, prior to being named Group Deputy Chief Financial Officer in
2012 and then Group Chief Financial Officer. He holds a CPA designation from the Canadian Institute of Chartered
Accountants and a CFA designation from the Chartered Financial Analysts Institute.
Proposal No. 1—Election of Directors
2023 Proxy Statement
29
SANJOY MUKHERJEE
5
Age: 56
Mr. Mukherjee is the Executive Vice President, General Counsel and Secretary of the Company. Since 2006, he has
served as Executive Vice President, Secretary, General Counsel and Chief Compliance Officer of Everest Global,
Everest Holdings and Everest Re, also serving as a director of them.
From 2016 to 2020, he served as Managing Director and CEO of Bermuda Re and still serves as Director, Executive
Vice President and General Counsel. During 2016, he became a Director of Everest Premier and Everest Denali. In
2015, he became a director, Chairman and CEO of Everest Preferred International Holdings, Ltd. (“Everest Preferred”)
and Everest International Holdings (Bermuda), Ltd. (“Bermuda Holdings”), a director of Everest Service Company (UK),
Ltd.,
Everest Corporate Member, Ltd. and Everest International Assurance, Ltd. During 2013, he became a director of
Mt.
Logan and in 2012 a director of EverSports & Entertainment Insurance, Inc. and Executive Vice President, Secretary
and
General Counsel of EverSports & Entertainment Insurance, Inc. and SIG Sports, Leisure and Entertainment Risk
Purchasing Group LLC. From 2009 to 2015, he served as Secretary of Everest Reinsurance Company (Ireland), dac
(“Ireland Re”) and Everest Underwriting Group (Ireland) Limited (“Ireland Underwriting”), where he continues to serve
as director. Since 2005, he has served as General Counsel of Everest National and Mt. McKinley Managers, L.L.C.,
a director, EVP, General Counsel, Compliance Officer and Secretary of Everest National and Director, EVP, General
Counsel and Secretary of Everest Indemnity and EVP, General Counsel, Compliance Officer and Secretary of Everest
Security Insurance Company (“Everest Security”). Since 2008, he has been Secretary and a director of Mt. Whitney
Securities, LLC. He became a Vice President of Mt. McKinley Insurance Co.in 2002, where he also served as a director
from 2011, until Mt. McKinley’s sale in 2015. In 2017, he became a director of Everest Dublin Insurance Holdings.
Prior to joining the Company in 2000 as Associate General Counsel, Mr. Mukherjee developed an array of functional
experience in the insurance and reinsurance industries including legal, claims management, underwriting,
contract wording, accounting and finance, regulatory compliance and risk management. From 1994 to 2000, he
was engaged in the private practice of law as a commercial litigator and corporate attorney specializing in the
insurance and reinsurance industries. Prior to receiving his law license, Mr. Mukherjee was a Senior Consultant
with
Andersen
Consulting
(n/k/a
Accenture)
specializing
in
the
manufacturing
and
financial
services
industries
and
an auditor with the public accounting firm of Touche Ross. Mr. Mukherjee’s credentials include a B.S., J.D., MBA
(Finance) and LL.M. (Tax).
5
On March 14, 2023, Everest announced that Sanjoy Mukherjee will be leaving the Company effective April 21, 2023, and that Brent Hoffman,
currently Head of Claims and Chief Operations Officer for the Company’s Reinsurance Division, has been appointed interim General Counsel. After
Mr. Mukherjee’s departure on April 21, he will remain available as an advisor to Everest to assist in the transition into July 2023.
Proposal No. 1—Election of Directors
30
2023 Proxy Statement
JIM WILLIAMSON
Age: 49
Mr. Williamson joined Everest in 2020 as the Group Executive Vice President and Chief Operating Officer. In May
2021, Mr. Williamson also took on additional responsibilities as Head of
Reinsurance for Everest. He is also a Director
International Re, Bermuda Re and Everest Reinsurance Company and also serves as Executive Vice President,
COO and Head of Reinsurance Division for Everest Reinsurance Company. Prior to Everest, Mr. Williamson spent
seven years with Chubb in various positions, including as Division President, North America Small Business from
January 2016 until September 2020. Mr. Williamson also spent over eight years at The Hartford, where he began
his insurance career as a casualty underwriter and later led the underwriting and service operation for the small
business insurance franchise. Over the years, at The Hartford, Chubb and now Everest, he has worked in all aspects
of the P&C commercial and consumer lines industry both in the U.S. and internationally running large and successful
businesses. He has also had functional responsibilities for actuarial, technology and claims organizations during
his career. Mr. Williamson holds an MBA from The Wharton School at the University of Pennsylvania and a B.S. from
Bryant College.
The Board Of Directors and its Committees
2023 Proxy Statement
31
THE BOARD OF DIRECTORS AND ITS COMMITTEES
Board of Directors
John J.
Amore
Juan C.
Andrade
William F.
Galtney, Jr.
John A.
Graf
Meryl
Hartzband
Gerri
Losquadro
Hazel
McNeilage
Roger M.
Singer
Joseph V.
Taranto
Skills
&
Experience
Executive
X
X
X
X
X
X
X
X
X
Insurance Industry
Experience
X
X
X
X
X
X
X
X
X
Reinsurance Industry
Experience
X
X
X
X
X
X
X
X
X
Claims
X
X
X
X
Risk
X
X
X
X
X
X
X
X
Regulatory
X
X
X
X
Finance/Capital
Management and
Accounting
X
X
X
X
X
X
X
X
X
Corporate Governance
X
X
X
X
X
X
X
X
X
Business
Operations
X
X
X
X
X
X
X
X
X
International
X
X
X
X
X
X
X
X
Investments
X
X
X
X
X
Merger & Acquisition
X
X
X
X
X
X
Information Technology/
Cyber Security
X
X
X
Legal
X
Marketing & Branding
X
X
X
* Further specific details concerning the Board’s race, ethnicity and gender make-up can be found within Everest’s Corporate Responsibility Reports
available on Everest’s website.
The Board Of Directors and its Committees
32
2023 Proxy Statement
The Company’s commitment to strong corporate governance helps us compete effectively, sustain our success over
dynamic economic cycles and build long-term shareholder value.
Role of the Board
Governance is a continuing focus at the Company, starting with the Board and extending to management and all
employees. The Board reviews the Company’s policies and business strategies and advises and counsels the CEO and
the
other executive officers who manage the Company’s businesses. In addition, as noted above, we solicit feedback from
our
shareholders
and
engage
in
discussions
with
various
stakeholders
on
governance
issues
and
improvements.
Board Committees and Their Roles
The Board conducts its business through its meetings and meetings of its committees. The Board currently maintains
Audit, Nominating and Governance, Compensation, Executive, Investment Policy and Risk Committees. NYSE listing
standards require that the Audit, Compensation and Nominating and Governance Committees are each entirely
composed of independent directors with written charters addressing such committee’s purpose and responsibilities
and that the performance of such committees be evaluated annually.
•
Audit Committee
The Audit Committee assists the Board in its oversight of the integrity of the Company’s financial statements,
the Company’s compliance with legal and regulatory requirements, the independent auditor’s qualifications and
independence and the performance of the Company’s internal audit function.
•
Nominating and Governance
The Nominating and Governance Committee is charged with annually determining the appropriate size of the
Board, identifying individuals qualified to become new Board members consistent with the criteria adopted by the
Board in the Corporate Governance Guidelines, recommending to the Board the director nominees for the next
annual meeting of shareholders, annually evaluating and recommending to the Board any appropriate changes to
the Corporate Governance Guidelines and overseeing the Company’s ESG initiatives and status. The Nominating
and Governance Committee also reviews the Board’s governance standards to ensure that they continue to reflect
the best practices insisted upon by our shareholders.
•
Compensation Committee
The Compensation Committee is primarily responsible for discharging the Board’s responsibilities relating to the
compensation of the Company’s officers at the level of Senior Vice President and above, as well as the Comptroller,
Treasurer, Secretary and the Chief Internal Audit Officer, reviewing the Compensation Discussion and Analysis
with
management and evaluating whether compensation arrangements create risks to the Company.
•
Executive Committee
The Executive Committee was created to engage in special projects at the behest of the full Board as well as serve
as the Board’s representative delegee on emergent matters when a full convening of the Board is impractical.
•
Investment Policy Committee
The
Investment
Policy
Committee
oversees
asset
allocation
and
manager
selection
as
well
as
the
overall
risk
profile
the Company’s portfolio.
• Risk Committee
The Risk Committee was created to oversee the Company’s ERM practices and principles, including identifying,
monitoring and overseeing the overall risk management functions of the Company as well as establishing the
Company’s risk appetite and tolerance levels. The Risk Committee fosters robust discussion among executives and
directors on complex underwriting opportunities, strategy, product development, loss mitigation and hedging
strategies as well as emerging risks such as climate change.
The Board operates its committees in a collaborative fashion, with meetings of each committee being open to
informational attendance by non-committee Board members and executives. This fosters rigorous discussion, cross-
committee information sharing and risk identification and allows for better informed oversight.
The Board Of Directors and its Committees
2023 Proxy Statement
33
Membership on Board Committees
Name
Audit
Compensation
Executive
Investment
Policy
Nominating
and
Governance
Risk
Committee
Independent
John J. Amore
X
Chair
X
X
X
Juan C. Andrade
X
X
X
William F. Galtney, Jr.
X
X
X
Chair
X
X
John A. Graf
X
X
Chair
X
X
Meryl Hartzband
Chair
X
X
X
X
Gerri Losquadro
X
X
X
Chair
X
Hazel
X
X
X
X
X
Roger M. Singer
X
X
X
X
Joseph V. Taranto
X
X
Meetings
4
4
4
4
4
4
Four formal meetings of the Board were held in 2022. Each applicable director attended 100% of the total number
of meetings of the Board and meetings of all committees of the Board on which the director served either in person
or through an alternate director appointment as permitted by the Bye-laws and the Bermuda Companies Act 1981.
The directors are expected to attend the Annual General Meeting pursuant to the Company’s Corporate Governance
Guidelines. All applicable directors attended the 2022 Annual General Meeting of Shareholders.
Director Independence
Our Board of Directors has established criteria for determining director “independence” as set forth in our Corporate
Governance Guidelines. These criteria incorporate all the requirements for director independence contained in the
NYSE listing standards. No director shall be deemed to be “independent” unless the Board shall have affirmatively
determined that no material relationship exists between such director and the Company other than the director’s
service as a member of our Board or any Board committee. In addition, the following enhanced criteria apply to
determine independence:
•
no director who is an employee, or whose immediate family member is an executive officer of the Company, is
deemed independent until three years after the end of such employment relationship;
•
no director is independent who:
(i) is
a
current
partner
or
employee
of
a
firm
that
is
the
Company’s
internal
or
external
auditor;
(ii) has
an
immediate
family
member
who
is
a
current
partner
of
such
firm;
(iii)
has an immediate family member who is a current employee of such firm and personally works on the
Company’s audit; or
(iv)
was or had an immediate family member who was within the last three years a partner or employee of such
firm and personally worked on the Company’s audit within that time;
•
no director who is employed, or whose immediate family member is employed, as an executive officer of another
company where any of our present executives serve on that company’s compensation committee is deemed
independent until three years after the end of such service or the employment relationship;
• no director who is an executive officer or an employee, or whose immediate family member is an executive officer, of
a
company that makes payments to, or receives payments from, the Company for property or services in an amount
that,
in any single year, exceeds $10,000 is deemed independent;
•
no director who has a personal services contract with the Company, or any member of the Company’s senior
management is independent;
•
no director who is affiliated with a not-for-profit entity that receives significant contributions from the Company is
independent; and
• no
director
who
is
employed
by
a
public
company
at
which
an
executive
officer
of
the
Company
serves
as
a
director
is
independent.
The Board Of Directors and its Committees
34
2023 Proxy Statement
Enhanced Audit Committee Independence Requirements
The members of our Audit Committee must meet the following additional independence requirements:
•
no director who is a member of the Audit Committee shall be deemed independent if such director is affiliated with
the Company or any of its subsidiaries in any capacity, other than in such director’s capacity as a member of our Board
of Directors, the Audit Committee or any other Board committee or as an independent subsidiary director; and
• no director who is a member of
the Audit Committee shall be deemed independent if
such director receives, directly
or
indirectly, any consulting, advisory or other compensatory fee from the Company or any of its subsidiaries, other
than
fees received in such director’s capacity as a member of our Board of Directors, the Audit Committee or any other
Board committee, or as an independent subsidiary director and fixed amounts of compensation under a
retirement
plan, including
deferred
compensation, for
prior
service
with
the
Company
(provided
such
compensation
not contingent in any way on continued service).
Enhanced Compensation Committee Independence Requirements
The members of our Compensation Committee must meet the following additional independence requirements:
•
no director shall be considered independent who:
(i)
is currently an officer (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934 (the “Exchange Act”))
of the Company or a subsidiary of the Company, or otherwise employed by the Company or subsidiary of the
Company;
(ii)
receives compensation, either directly or indirectly, from the Company or a subsidiary of the Company, for
services rendered as a consultant or in any capacity other than as a director, except for an amount that does not
exceed the dollar amount for which disclosure would be required pursuant to Item 404(a) of Regulation S-K; or
(iii)
possesses an interest in any other transaction for which disclosure would be required pursuant to Item 404(a)
of Regulation S-K.
In assessing the independence of members of the Compensation Committee the Board will consider all factors
specifically relevant to determining whether a director has a relationship to the Company that is material to such
member’s
ability
to
be
independent
from
management
in
connection
with
his
or
her
duties, including
but
not
limited
to
(i) the source of his or her compensation, including any consulting advisory, or other compensatory fee paid by the
Company to such director and (ii) whether such director is affiliated with the Company, a subsidiary of the Company
or an affiliate of a subsidiary of the Company.
Independence Determination
Our Board has affirmatively determined that Mses. Hartzband, Losquadro and McNeilage and Messrs. Amore, Galtney,
Graf and Singer each meet the criteria for independence for Board members set forth above. Moreover, all members
of the Audit Committee and Compensation Committee meet the further requirements for independence set forth
above with respect to those committees.
The Board considered whether these directors had any material relationships with the Company, its affiliates
or the Company’s external auditor and concluded that none of them had a relationship that impaired his or her
independence. The Board based its determination on personal discussions with the directors and a review of each
director’s responses to an annual questionnaire regarding employment, compensation history, affiliations and family
and
other relationships. The questionnaire responses form the basis for reviewing a director’s financial transactions
involving the Company that is disclosed by a director, regardless of the amount in question. This annual review is
performed in compliance with the Company’s Bye-laws and the Bermuda Companies Act 1981 and the results are
approved by resolution of the Board of Directors. Directors are also subject to the Company’s Ethics Guidelines
which
require
full
and
timely
disclosure
to
the
Company
of
any
situation
that
may
result
in
a
conflict
or
appearance
of
a
conflict.
Additionally, in accordance with our Corporate Governance Guidelines and the disclosure requirement set forth in
Bye-law 21(b) of the Company’s Bye-laws (which in turn requires compliance with the Bermuda Companies Act 1981),
each
director must disclose to the other directors any potential conflicts of interest he may have with respect to any
matter
under discussion. If a director is disqualified by the Chairman because of a conflict, he must refrain from voting
on a
matter in which he may have a material interest
Board Structure and Risk Oversight
2023 Proxy Statement
35
BOARD STRUCTURE AND RISK OVERSIGHT
Board Diversity
Our Board believes that it is essential that directors represent diverse perspectives, skills and experience. Diversity is
important because having various perspectives contributes to more effective decision-making and risk management.
The objective of the Nominating and Governance Committee is to recommend a slate of candidates that can best
perpetuate the success of our business and represent shareholder interests through the exercise of sound judgment
honed by diverse experiences and perspectives. When evaluating the qualifications, experiences and backgrounds
of
director candidates, the Board reviews and discusses many aspects of
diversity such as gender, age, ethnicity, education,
professional experience, personal accomplishment and differences in viewpoints and skills. Director recruitment
efforts include these factors, and the Board strives to recruit candidates that enhance the Board’s diversity. Our Board’s
Nominating & Governance Committee is especially committed to expanding its pool of director candidates to ensure the
inclusion of highly qualified women and persons of color.
Leadership Structure
The Board reviews the Company’s leadership structure from time to time to ensure that it serves the best interests
of the shareholders and positions the Company for future success. We believe that the Company is best served
with a separate CEO, Chairman of the Board and Independent Lead Director so that three separate and distinct
voices provide appropriate guidance and diverse points of views on governance and strategy while preserving and
aligning shareholder interests. This leadership structure emphasizes a team approach to the appropriate balance of
leadership, independent oversight and strong corporate governance.
The CEO is responsible for setting the strategic direction, culture and day-to-day leadership and performance of the
Company, while remaining cognizant and fully up-to-date of the current dynamics of the market such as where risk
factors lie and where growth opportunities and potential exist.
The Chairman of the Board, among other things, provides guidance and counsel to the CEO, consults with the CEO
in setting the agenda for the Board meetings and presides over meetings of the full Board. Our current Chairman,
with decades of leadership experience, industry expertise and gravitas and institutional knowledge regarding the
Company, has successfully navigated multiple (re)insurance market cycles and remains connected to both the industry
and the Company’s current operations.
The Independent Lead Director provides a forum for independent director deliberation and feedback and helps
ensure that all Board members have the means to and do carry out their responsibilities in accordance with their
fiduciary duties. The Independent Lead Director also coordinates the annual board performance evaluation and works
with the Chairman in coordinating matters of priority among the independent directors and facilitating dialogue on
substantive matters of governance involving the Board. The Independent Lead Director is selected annually by the
independent directors and serves as an independent leadership voice to ensure the Company’s alignment of interest
with shareholders to deliver long-term best-in-class return and total value creation.
The Chairman and Independent Lead Director work together to ensure the Company is proceeding in the right
direction while maintaining best practices in corporate governance. Further, our CEO, Chairman and Independent
Lead Director work closely to discuss strategic initiatives for the Company. This tripartite leadership framework was
put in place to make sure different points of view are given appropriate weight at Board meetings and that no single
viewpoint is given disproportionate deference.
Given his vast executive leadership and operational experience and knowledge of the (re)insurance industry and
market, as well as his value to our competitors, the Board believes it is in the best interests of the Company for
Mr. Taranto to remain a non-executive part-time employee of the Company and continue to chair the Board of
Directors. In addition to Mr. Taranto and Mr. Andrade, both of whom are non-independent, the Board is comprised of
seven outside directors, all of whom are independent. Mr. Roger M. Singer served as the Independent Lead Director in
2022 and, in that capacity, complements the talents and contributions of Messrs. Andrade and Taranto and promotes
confidence in our governance structure by providing an independent perspective to that of management.
Prior to each scheduled meeting of the Board of Directors, the directors who are not officers of the Company meet
in executive session outside the presence of management to determine and discuss any items including those that
should be brought to the attention of management.
In December 2021, the Board announced the extension of President and CEO Juan C. Andrade’s employment
agreement through the end of 2023 with automatic annual extensions following his term. Mr. Andrade’s leadership,
experience and dedication to Everest, particularly in response to the COVID-19 Pandemic, has been evident since he
Board Structure and Risk Oversight
36
2023 Proxy Statement
became CEO on January 1, 2020, and the Board is extremely confident that under Mr. Andrade’s leadership, Everest
is well-positioned for continued success.
The Independent Lead Director: Role and Responsibilities
While Mr. Taranto serves as Chairman, Board leadership also comes from our Independent Lead Director, Mr. Singer.
The responsibilities of the Independent Lead Director include:
•
Coordinating executive sessions of the independent members of the Board without management present;
• Authorization
to
call
meetings
of
the
independent
directors;
•
Serving as a liaison between the Chairman and the independent directors and providing a forum for independent
director feedback at executive sessions;
•
Communicating regularly with the CEO and the other directors on matters of Board governance;
• Assisting
in
Board
meeting
agenda
preparation
in
consultation
with
the
Chairman;
•
Overseeing the annual Board review and evaluation process including individual director evaluations and facilitating
discussion of the results;
•
Leading board discussions on oversight of Environmental, Social and Governance reporting;
• Assuring
that
all
Board
members
carry
out
their
responsibilities
as
directors;
•
If requested and, when appropriate, consultation and direct communication with shareholders as the independent
representative of the Board.
Board Role in Risk Oversight
Prudent risk management is embodied throughout our Company as part of our culture and is a key point of
emphasis by our Board. Given the complex risk-based nature of our business, the Board divides its risk management
responsibilities among financial and operational risks. Financial risk oversight is within the purview of the Audit
Committee. In accordance with NYSE requirements, the Company’s Audit Committee Charter provides that the Audit
Committee has the responsibility to discuss with management the Company’s major financial risk exposures and the
steps management has taken to monitor and control its risk profile, including the Company’s financial risk assessment
and risk management guidelines. Upon the Audit Committee’s recommendation, the Board has adopted a formal
Risk Appetite Statement that is reviewed annually and establishes upper boundaries on risk taking in certain areas
of the Company including assets, investments and property and casualty business, including natural catastrophe
exposure and potential maximum loss.
In order to monitor the Company’s compliance with the Board’s Risk Appetite Statement with more granularity across
the
Company’s key operational areas of underwriting, exposure management, emerging risks and technology, the
Board established a separate Risk Committee. In managing and implementing the Board’s Risk Appetite Statement,
the Company developed an ERM process for managing the Company’s risk tolerance profile on a holistic basis.
The objective of ERM is to provide an internal framework for assessing risk – both to manage downside threats, as
well as identify upside opportunities – with the ultimate goal of enhancing shareholder value. Company-wide ERM
is coordinated through a centralized ERM Unit responsible for implementing the risk management framework that
identifies, assesses, monitors, controls and communicates the Company’s risk exposures. The ERM Unit is overseen
by our Chief Risk Officer and is staffed and supported with seasoned and accredited actuarial, accounting and
management staff.
The Risk Committee reviews ERM status with the Chief Risk Officer each quarter to assess not only operational and
systemic level risks, but also the level of resources allocated to the ERM Unit. The Board also oversees identification
and management of risk at the Board committee level. While each Board committee is responsible for evaluating the
Company’s operational risks falling within its area, the Board is kept informed of the respective committee’s activities
and actions through committee reports. Moreover, the limited size of our Board allows for each committee meeting
to be attended by all Board members regardless of their respective formal committee appointments.
In order to monitor compliance and liaise with the Board regarding the Company’s ERM activities, we created the
Enterprise Risk Committee (ERC). The ERC oversees additional aspects of risk management, including establishing
our risk management principles, policies and risk appetite levels in collaboration with the Board. The Underwriting
Risk Committee, Financial Risk Committee and Operational Risk Committee report to the ERC. These committees
meet quarterly to review their status and plans, initiate new efforts and produce a quarterly risk management report
disclosing key risks. The Underwriting Risk Committee monitors underwriting performance and risk, including
Board Structure and Risk Oversight
2023 Proxy Statement
37
underwriting controls, while the Financial Risk Committee monitors financial risk, including the cost of capital, liquidity
and investor confidence. The Operational Risk Committee monitors operational risk and functional compliance with
risk management policies. The ERC reports directly to the Board of Directors. Further, our Emerging Risk Committee
identifies, analyzes, evaluates and monitors emerging risks that could generate opportunities or material adverse
consequences for the group and then translates those insights into actionable strategic recommendations to senior
management.
Cybersecurity
Our Board views cybersecurity risk as an enterprise-wide concern that involves people, processes and technology
and accordingly treats it as a Board level matter. Cybersecurity threats embody a persistent and dynamic threat to
our entire industry and are not limited to information technology. Our directors endeavor to educate themselves
in this area through literature, seminars and other industry publications. Further, the Board is considering adding
this specialized skillset when considering future candidates for Board membership. In recognition of the specialized
nature of this risk, the Company appointed a Chief Information Security Officer (“CISO”) dedicated to assessing the
Company’s data security risk, monitoring cyber threat intelligence and taking the steps necessary to implement
pertinent safeguards and protocols to manage the risk. In addition, the ERC annually reviews the Company’s cyber
exposure across all lines of business and security safeguards for protected privacy data held by the Company. The
ERC works in conjunction with the Company’s CISO in assessing the Company’s vulnerabilities to cyber threats. In view of
the specialized nature of this risk, continuous dialogue throughout the year is essential in assessing the operational
risk
to our business of third-party hacking, ransomware exposure and other security threats.
Climate Risk
Risk—identifying, modeling and managing it—is at the core of the insurance industry. Today, the science is clear: there
is no greater long-term risk to our planet than that posed by climate change. We recognize that climate change and
emerging ESG issues, among other factors, are only becoming increasingly and more urgently important for both
Everest and the (re)insurance industry at large.
Climate change contributes to higher sea surface temperatures, rising sea levels and increasing trends in extreme
weather events including floods, droughts, winter storms, wildfires and hurricane intensity. The growing expansion
and concentration of humans and rising property values on coastlines and other ecologically sensitive areas means
that extreme weather conditions can quickly turn into catastrophe events in terms of losses inflicted. As a risk transfer
mechanism for our clients, we are committed to providing insurance and reinsurance protection that protects
communities from climate change impacts and help them rebuild, developing effective loss mitigation strategies and
supporting our communities in collaboration with governments to limit human impact on the global environment.
We have a responsibility to manage a risk environment made volatile by global climate change. We are exposed to
climate-related risks on both sides of the balance sheet—as risk carriers, as well as institutional investors. Increased
frequency and severity of extreme weather-related events directly attributable to climate change impacts the volatility
and magnitude of losses across geographies.
As an insurer and reinsurer of property and capital that may be impacted by climate and weather conditions, the
Company quantifies and manages such risk by utilizing the latest meteorological and parametric risk models,
updated to take into account the human impact on climate change, to evaluate and assess deviations in historic
climate patterns as a predictive factor for catastrophe risk and its related impact on both pricing and accumulation as
an
aid to underwriting and product development. Such potential maximum loss and accumulation exposure analyses
assessed quarterly by the ERC and then presented to the Board’s Risk Committee as part of its oversight of the ERM
process.
Our risk management strategies seek to minimize the impact of severe climate and weather events on our capital
by, among other things, maintaining a diversified business portfolio – spread by line and geography – and by
employing a tactical approach to managing risk, including, but not limited to, utilization of third-party capital to
leverage opportunity and issuance of catastrophe bonds. Furthermore, we encourage and work with our insureds to
consider the impact of climate risk on their operations and property in conjunction with underwriting, engineering
and loss mitigation services we provide. Policyholders that demonstrate sound environmental practices and adopt
loss mitigating measures to protect their facilities and operations receive insurance premium credits as an economic
incentive to reduce their exposure to risk of loss associated with climate change.
Board Structure and Risk Oversight
38
2023 Proxy Statement
As an investor, the Company assesses the impact of climate risks on our global investment portfolio and identifies
investment opportunities in the green sector in anticipation of
the shift to a low-carbon global economy. The Company’s
investment portfolio is also highly diversified by risk, industry, location, type and duration of security to further mitigate
the impact of climate change. Moreover, as a signatory to the PRI, we review and update our investment guidelines
annually to reflect these principles. We employ a principles-based investment strategy designed to diversify our
global portfolio by identifying emerging opportunities across various sectors that contribute long-term value to
society and the environment, while acting in compliance with certain regulatory restrictions on the composition of
our investment portfolio. Such a strategy does not eliminate or seek to withdraw from specific industries at the outset.
Rather, our investment strategy assumes a proactive and measured approach in transitioning our portfolio from
declining heavy carbon-emitting industries to eco-friendly and value generating opportunities including renewable
energy, government sponsored green bonds and public works projects. We also endeavor to invest in companies
that employ a strategy for expanding the use of renewable and sustainable materials in their production processes
and ensure recognition and support of human rights in their supply chains.
Finally, in addition to seeking ways to further our underwriting support of the zero-carbon energy transition, we
continue to analyze the Company’s exposures to fossil fuels within our underwriting portfolios. In 2022, insurance
premium from companies that generate 25% or more of their revenue from coal represented less than approximately
.09% of
Everest’s overall 2022 gross written premium. Further, insurance premium from companies that generate 25%
or
more of their revenue from oil or natural gas represented less than approximately 0.75% of our overall 2022 gross
written
premium.
Board Committees
2023 Proxy Statement
39
BOARD COMMITTEES
Audit Committee
The principal purposes of the Company’s Audit Committee, as set forth in its Charter, are to oversee the integrity
of the Company’s financial statements and the Company’s compliance with legal and regulatory requirements,
oversee the independent registered public accounting firm, evaluate the independent registered public accounting
firm’s qualifications and independence and oversee the performance of the Company’s internal audit function. The
Company’s Chief Internal Audit Officer reports directly to the Chairman of the Audit Committee. The Audit Committee
meets with the Company’s management, Chief Internal Audit Officer and the independent registered public
accounting firm, both separately and together, to review the Company’s internal control over financial reporting and
financial statements, audit findings and significant accounting and reporting issues. The Audit Committee Charter is
reviewed annually and revised as necessary to comply with all applicable laws, rules and regulations. The Charter is
available on the Company’s website at http://www.everestre.com.
No member of the Audit Committee may serve on the Audit Committee of more than two other public companies
unless the Board has determined that such service will not affect such member’s ability to serve on the Company’s
Audit Committee.
Based upon their significant financial experience gained in various leadership and operational roles regarding financial
assessment and reporting, the Board has determined that all members of the Audit Committee are financially literate
and
qualify as “audit committee financial experts” as defined by SEC rules and have accounting or related financial
management expertise as required by NYSE listing standards.
Audit Committee Report
The Audit Committee has reviewed and discussed with management, which has primary responsibility for the
financial statements and with PricewaterhouseCoopers LLP, the Company’s independent auditors, the audited
financial statements for the year ended December 31, 2022 (the “Audited Financial Statements”). In addition, the
Audit Committee has discussed with PricewaterhouseCoopers LLP the matters required to be discussed by Public
Company Accounting Oversight Board Auditing Standard No. 1301 “Communications with Audit Committees.”
The Audit Committee has received the written disclosures from PricewaterhouseCoopers LLP as required by
applicable requirements of the Public Company Accounting Oversight Board regarding PricewaterhouseCoopers
LLP’s communications with the Audit Committee concerning independence and has discussed with that firm its
independence. The Audit Committee also has discussed with Company management and PricewaterhouseCoopers
LLP such other matters and received such assurances from them as the Committee deemed appropriate. Based on
the foregoing review and discussions and relying thereon, the Audit Committee recommended to the Board the
inclusion of the Audited Financial Statements in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2022.
The Audit Committee devoted substantial time in 2022 to discussing with the Company’s independent auditors and
internal auditors the status and operating effectiveness of the Company’s internal control over financial reporting. The
Audit Committee’s oversight involved several meetings, both with management and with the independent auditors
outside the presence of management, to monitor the preparation of management’s report on the effectiveness of
the Company’s internal controls. The meetings reviewed in detail the standards that were established, the content of
management’s assessment and the auditors’ testing and evaluation of the design and operational effectiveness of the
internal controls. As reported in the Company’s Annual Report on Form 10-K filed February 24, 2023, the independent
auditors concluded that, as of December 31, 2022, the Company maintained, in all material respects, effective internal
control over financial reporting based upon the criteria established in the Internal Control-Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).
Under its Charter and the “Audit and Non-Audit Services Pre-Approval Policy” (the “Policy”), the Audit Committee is
required to pre-approve the audit and non-audit services to be performed by the independent auditors. The Policy
mandates specific approval by the Audit Committee for any service that has not received a general pre-approval or
that exceeds pre-approved cost levels or budgeted amounts. For both specific and general pre-approval, the Audit
Committee considers whether such services are consistent with the SEC’s rules on auditor independence. The Audit
Committee also considers whether the independent auditors are best positioned to provide the most effective and
efficient service and whether the service might enhance the Company’s ability to manage or control risk or improve
audit quality. The Audit Committee is also mindful of the relationship between fees for audit and non-audit services
in deciding whether to pre-approve any such services. It may determine, for each fiscal year, the appropriate ratio
between the total amount of audit, audit-related and tax fees and a total amount of fees for certain permissible
non-audit services classified below as “All Other Fees”. All such factors are considered as a whole and no one factor
Board Committees
40
2023 Proxy Statement
is determinative. The Audit Committee further considered whether the performance by PricewaterhouseCoopers
LLP of the non-audit related services disclosed below is compatible with maintaining their independence. The Audit
Committee approved all the audit-related fees, tax fees and all other fees for 2022 and 2021.
The fees billed to the Company by PricewaterhouseCoopers LLP and its worldwide affiliates related to 2022 and 2021
are
as follows:
2022
2021
Audit Fees
(1)
$6,719,687
$6,439,802
Audit-Related Fees
(2)
587,563
610,138
Tax
(3)
712,558
614,200
All Other Fees
(4)
38,550
37,200
(1) Audit fees include the annual audit and quarterly financial statement reviews, internal control audit (as required by the Sarbanes
Oxley Act of 2002), subsidiary audits and procedures required to be performed by the independent auditors to be able to form
an opinion on the Company’s consolidated financial statements. Audit fees also include statutory audits or financial audits of
subsidiaries or affiliates of the Company and services associated with SEC registration statements, periodic reports and other
documents filed with the SEC or other documents issued in connection with securities offerings.
(2) Audit-related fees include assurance and related services that are reasonably related to the performance of the audit or review of the
Company’s financial statements; accounting consultations related to accounting, financial reporting or disclosure matters not
classified as “audit services”; assistance with understanding and implementing new accounting and financial reporting guidance
from
rulemaking authorities; financial audits of employee benefit plans; agreed-upon or expanded audit procedures related to
accounting and/or billing records required to respond to or comply with financial, accounting or regulatory reporting matters
and assistance with internal control reporting requirements.
(3) Tax
fees
include
tax
compliance,
tax
planning
and
tax
advice
and
may
be
granted
general
pre-approval
by
the
Audit
Committee.
(4) All
other
fees
are
for
accounting
and
research
subscriptions.
Compensation Committee
Meryl Hartzband, Chairwoman
John J. Amore
William F. Galtney, Jr.
John A. Graf
Gerri Losquadro
Hazel McNeilage
Roger M. Singer
The Compensation Committee exercises authority with respect to all compensation and benefits afforded all officers
at the Senior Vice President level and above, the Named Executive Officers and the Company’s Chief Financial Officer,
Comptroller, Treasurer, Chief Internal Audit Officer, Chief
Risk Officer and Secretary. The Compensation Committee also
has
oversight
responsibilities
for
all
of
the
Company’s
compensation
and
benefit
programs, including
administration
the Company’s 2020 Stock Incentive Plan, which was approved by shareholders at the 2020 Annual General
Meeting (the “2020 Stock Incentive Plan”) and the Executive Performance Annual Incentive Plan. The Compensation
Committee adopted a Charter which is available on the Company’s website at http://www.everestre.com. The
Compensation Committee Charter, which is reviewed annually and revised as necessary to comply with all
applicable laws, rules and regulations, provides that the Compensation Committee may form and delegate authority
to subcommittees or to committees of the Company’s subsidiaries when appropriate. This delegation authority was not
exercised by the Compensation Committee during 2022. Additional information on the Compensation Committee’s
processes and procedures for consideration of executive compensation are addressed in this Proxy Statement under
the heading “Compensation Discussion and Analysis”.
Board Committees
2023 Proxy Statement
41
Compensation Committee Report
Management has the primary responsibility for the Company’s financial statements and reporting process, including
disclosure of executive compensation. The Compensation Committee has reviewed and discussed with
management the Compensation Discussion and Analysis contained in this Proxy Statement and based on this review
and discussion, recommended to the Board of Directors that the Compensation Discussion and Analysis be included
in this Proxy Statement.
Nominating and Governance Committee
John J. Amore (Chairman)
William F. Galtney, Jr.
John A. Graf
Meryl Hartzband
Gerri Losquadro
Hazel McNeilage
Roger M. Singer
The Nominating and Governance Committee is vested with the authority and responsibility to identify and recommend
qualified individuals to be nominated as directors of the Company and to develop and recommend to the Board
the Corporate Governance Guidelines applicable to the Company. Further, the Committee Chairman facilitates
discussion of Board governance best practices in conjunction with management. The Charter is available on the
Company’s website at http://www.everestre.com.
Shareholder Nominations for Director
The Nominating and Governance Committee will consider a shareholder’s nominee for director who is proposed
in accordance with the procedures set forth in Bye-law 12 of the Company’s Bye-laws, which is available on the
Company’s website or by mail from the Corporate Secretary’s office. In accordance with this Bye-law, written notice
of a shareholder’s intent to make such a nomination at the 2024 Annual General Meeting of Shareholders must
be received by the Secretary of the Company at the address listed below under Shareholder and Interested Party
Communications with Directors, between November 16, 2023 and December 16, 2023. Such notice shall set forth
the name and address, as it appears on the Register of Members, of the shareholder who intends to make the
nomination; a representation that the shareholder is a holder of record of shares of the Company entitled to vote at
such meeting and intends to appear in person or by proxy at the meeting to make such nomination; the class and
number of shares of the Company which are held by the shareholder; the name and address of each individual to
be nominated; a description of all arrangements or understandings between the shareholder and any such nominee
and any other person or persons (naming such person or persons) pursuant to which such nomination is to be made
by the shareholder; such other information regarding any such nominee required to be included in a proxy statement
filed pursuant to Regulation 14A under the Securities Exchange Act of 1934; and the consent of any such nominee to
serve as a director, if so elected.
As with any candidate for director, the Nominating and Governance Committee will consider a shareholder candidate
nominated in accordance with the procedures of Bye-law 12 based solely on his/her character, judgment, education,
training, business experience and expertise. In addition to complying with independence standards of the NYSE,
the SEC and the Company, candidates for director must possess the highest levels of personal and professional
ethics, integrity and values and be willing to devote sufficient time to perform their Board and Committee duties. It
is in the Company’s best interests that the Board be comprised of individuals whose skills, experience, diversity and
expertise complement those of the other Board members. The objective is to have a Board which, taken as a whole, is
knowledgeable in the areas of insurance/reinsurance markets and operations, accounting (using generally accepted
accounting practices and/or statutory accounting practices for insurance companies), financial management and
investment, legal/regulatory and any other areas which the Board and Committee deem appropriate in light of the
continuing operations of the Company and its subsidiaries. Financial services-related experience, other relevant
prior service, a familiarity with national and international issues affecting the Company’s operations and a diversity of
background and experience are also among the relevant criteria to be considered. Following interviews, meetings
and such inquiries and investigations determined to be appropriate under the circumstances, the Committee makes
its director recommendations to the Board. The foregoing criteria are as specified in the Company’s Corporate
Governance Guidelines. As a part of the annual self-evaluation process, the Nominating and Governance Committee
assesses its adherence to the Corporate Governance Guidelines.
Board Committees
42
2023 Proxy Statement
Board Evaluation
The Board conducts an annual performance evaluation under the oversight of the Nominating and Governance
Committee Chair. The evaluation process entails the use of an outside law firm to conduct individual director interviews
covering a wide array of topics that include, among other things, leadership, individual director assessment, training
and
Board effectiveness to assist in candid discussions that identify and promote areas for improvement as well as
successes. Upon completion of the individual director interviews, the third-party firm summarizes the directors’
assessments and individual reviews into a report that is provided to the chair of the Nominating & Governance
Committee for discussion with the Board at the February meeting. The Board identifies successes and areas for
improvement and establishes goals for the upcoming fiscal year.
Commitment to Environment, Social and Governance (“ESG”)
Our Company and Board believe that creation of long-term value for our shareholders implicitly requires the
enactment and execution of business practices and strategies that, while delivering competitive returns, also help
to advance environmental and societal issues. The Company understands it has a responsibility not only to provide
solutions that help our clients manage their environmental and climate change risks, but also to monitor and control
our
own ecological impact. Additionally, the Board is considering adding expertise in the environmental and climate risk
space when considering future candidates for Board membership. As a demonstration of our commitment to
responsible investment practices, the Company is a signatory to the PRI and the PSI. Independent of the nature of
our business, the Company prides itself on having an environmental and social conscience and encourages all of
our executives and employees to take an active role in this mission. The Board previously formally memorialized
the oversight of the Company’s ESG practices within the Nominating and Governance Committee charter, and the
Company published its second Corporate Responsibility Report in 2022 in accordance with the Global Reporting
Initiative standards as well as a supplemental report under Sustainability Account Standards Board guidelines which
are both available on the Company’s corporate website. In addition to these frameworks, our report published in
2022 aligned with the recommendations of the TCFD.
Risk Committee
Everest’s Risk Committee is the heart of the Board’s risk management function. Given the nature of insurance as a
risk-bearing endeavor, the Risk Committee serves a critical role in protecting the Company’s capital and ensuring
management alignment with our shareholders. The Risk Committee focuses the Board’s attention on the Company’s
most critical operational and systemic risk management capabilities. It is responsible for the general oversight of
Everest’s ERM practices, including identifying, monitoring and overseeing the overall risk management functions of
the Company as well as establishing the Company’s risk appetite and tolerance levels. Specific areas that fall within the
purview of this Committee’s risk review include but are not limited to: complex underwriting opportunities, reserving,
capital allocation, expansion opportunities, product development, actuarial pricing and analytics, underwriting margin
improvement opportunities, de-risking, loss mitigation and hedging strategies involving third-party capital and the
Company’s subsidiary Mt. Logan Re, deep dives into various product lines and whether to expand or discontinue
such lines, as well as timely areas of concern that may arise from time to time during any given quarter or year, such
as the impacts of COVID-19 or the impacts of inflation on claims or invested assets and appropriate risk-management
actions to take in response.
Ultimately, the Risk Committee serves as an invaluable resource for timely input and robust dialogue between
independent directors of the Company, with extensive risk management expertise and experience and Company
executives. It also provides yet another lens of protection against undue or inappropriate risk taking that may not be
aligned with the long-term interests of the Company. Further, it fosters an integrated, enterprise-wide approach to
identifying and managing risk and provides an impetus toward improving the quality of risk reporting and monitoring,
both for management and the Board. On no less than a quarterly basis, this Committee regularly meets and receives
extensive updates and detailed reports from such officers of the Company as the Group Chief Operating Officer and
Head of Reinsurance, the President and CEO of the Insurance Division, the Chief Underwriting Officers of both the
Insurance and Reinsurance Divisions and the Company’s Group Chief Risk Officer and Chief Actuary.
Code of Ethics for CEO and Senior Financial Officers
The Company’s Code of Conduct includes its “Ethics Guidelines” that are intended to guide all of the Company’s
decisions and behavior by holding all directors, officers and employees to the highest standards of integrity. In
addition to being bound by the Ethics Guidelines provisions relating to ethical conduct, conflict of interest and
compliance with the law, the Company has adopted a code of ethics that applies to the Chief Executive Officer, Chief
Financial Officer and Senior Financial Officers in compliance with specific regulations promulgated by the SEC. The
text of the Code of Ethics for the Chief Executive Officer and Senior Financial Officers is posted on the Corporate
Governance
page
on
the
Company’s
website
at
http://www.everestre.com.
This
document
is
also
available
in
print
to
Board Committees
2023 Proxy Statement
43
any shareholder who requests a copy from the Corporate Secretary at the address below. In the event the Company
makes any amendment to or grants any waiver from the provisions of its Code of Ethics, the Company intends to
disclose such amendment or waiver on its website within five business days.
Shareholder and Interested Party Communications with Directors
We reach out annually for feedback from our shareholders on concerns, suggestions for improvement and to identify
emerging best practices in governance and shareholder values. However, shareholders and interested parties are
encouraged to communicate directly with the Board of Directors or with individual directors. All communications
should be directed to the Company’s Secretary at the following address and in the following manner.
Everest Re Group, Ltd. Corporate Secretary
c/o Everest Global Services, Inc.
Warren Corporate Center
100 Everest Way
Warren, NJ 07059
Any
such
communication
should
prominently
indicate
on
the
outside
of
the
envelope
that
it
is
intended
for
the
Board
of
Directors, for the Non-Management Directors or for any individual director. Each communication addressed to an
individual director and received by the Company’s Secretary from shareholders or interested parties, which is
related to the operation of the Company and is not solely commercial in nature, will promptly be forwarded to the
specified party. Communications addressed to the “Board of Directors” or to the “Non-Management Directors” will
be forwarded to the Chairman of the Nominating and Governance Committee.
Common Share Ownership by Directors and Executive Officers
44
2023 Proxy Statement
COMMON SHARE OWNERSHIP BY DIRECTORS AND
EXECUTIVE OFFICERS
The following table sets forth the beneficial ownership of Common Shares as of March 20, 2023 by the directors of
the Company, the executive officers listed in the Summary Compensation Table currently employed by the Company
and by all directors and executive officers of the Company as a group. Information in this table was furnished to the
Company by the respective directors and Named Executive Officers. Unless otherwise indicated in a footnote, each
person listed in the table possesses sole voting power and sole dispositive power with respect to the shares shown
in the table as owned by that person.
Name
of
Beneficial
Owner
Amount and Nature of
Beneficial
Ownership
Percent
of Class
(14)
John J. Amore
22,298
(1)
*
William F. Galtney, Jr.
63,170
(2)
*
John A. Graf
14,059
(3)
*
Meryl Hartzband
8,595
(4)
*
Gerri Losquadro
12,955
(5)
*
Hazel
1,377
(6)
*
Roger M. Singer
16,420
(7)
*
Joseph V. Taranto
311,731
(8)
*
Juan C. Andrade
54,427
(9)
*
Mike Karmilowicz
10,551
(10)
*
Mark Kociancic
26,882
(11)
*
Sanjoy Mukherjee
43,871
(12)
*
Jim Williamson
11,695
(13)
*
All
directors,
nominees
and
executive
officers
as
a
group
(13
persons)
598,031
1.4
* Less
than
1%
(1)
Includes 2,050 restricted shares issued to Mr. Amore under the Company’s 2003 Non-Employee Director Equity Compensation Plan (“2003
Directors Plan”) which may not be sold or transferred until the vesting requirements are satisfied.
(2)
Includes 34,106 shares owned by various family related investments in which Mr. Galtney maintains a beneficial ownership and for which he
serves as the General Partner. Also includes 2,050 restricted shares issued to Mr. Galtney under the 2003 Directors Plan which may not be sold or
transferred until the vesting requirements are satisfied.
(3) Includes 2,050 restricted shares issued to Mr. Graf under the 2003 Directors Plan which may not be sold or transferred until the vesting requirements
are satisfied.
(4)
Includes 2,050 restricted shares issued to Ms. Hartzband under the 2003 Directors Plan which may not be sold or transferred until the vesting
requirements have been satisfied.
(5)
Includes 2,050 restricted shares issued to Ms. Losquadro under the 2003 Directors Plan which may not be sold or transferred until the vesting
requirements have been satisfied.
(6)
Includes 1,377 restricted shares issued to Ms. McNeilage under the 2003 Directors Plan which may not be sold or transferred until the vesting
requirements have been satisfied
(7)
Includes 2,050 restricted shares issued to Mr. Singer under the 2003 Directors Plan which may not be sold or transferred until the vesting
requirements are satisfied.
(8) Includes 19,330 shares owned by various family related trusts and investments in which Mr. Taranto maintains a beneficial ownership. Also, includes
2,050 restricted shares issued to Mr. Taranto under the Company’s 2020 Stock Incentive Plan which may not be sold or transferred until the vesting
requirements are satisfied.
(9) Includes 18,060 restricted shares issued to Mr. Andrade under the Company’s 2010 Stock Incentive Plan and 16,811 shares issued to Mr. Andrade
under the Company’s 2020 Stock Incentive Plan which may not be sold or transferred until the vesting requirements have been satisfied.
(10) Includes 983 restricted shares issued to Mr. Karmilowicz under the company’s 2010 stock incentive plan and 6,091 restricted shares issued under
Company’s 2020 Stock Incentive Plan which may not be sold or transferred until the vesting requirements have been satisfied.
(11) Includes 20,962 restricted shares issued to Mr. Kociancic under the Company’s 2020 Stock Incentive Plan which may not be sold or transferred until
the vesting requirements have been satisfied.
(12) Includes 2,279 restricted shares issued to Mr. Mukherjee under the Company’s 2010 Stock Incentive Plan and 4,611 shares issued to Mr. Mukherjee
under the Company’s 2020 Stock Incentive Plan which may not be sold or transferred until the vesting requirements have been satisfied.
(13) Includes 9,739 restricted shares issued to Mr. Williamson under the Company’s 2020 Stock Incentive Plan which may not be sold or transferred until
the vesting requirements have been satisfied.
(14) Based
on
44,098,856
total
Common
Shares
outstanding
and
entitled
to
vote
as
of
March
20,
2023.
Principal Beneficial Owners of Common Shares
2023 Proxy Statement
45
PRINCIPAL BENEFICIAL OWNERS OF COMMON SHARES
To the best of the Company’s knowledge, the only beneficial owners of 5% or more of the outstanding Common
Shares as of December 31, 2022 are set forth below. This table is based on information provided in Schedule 13G
Information Statements filed with the SEC by the parties listed in the table.
Name
and
Address
of
Beneficial
Owner
Number of
Shares
Beneficially
Percent
Class
Everest
Re
Advisors,
Ltd.
Seon Place, 141 Front Street, 4th Floor
Hamilton HM 19, Bermuda
9,719,971
(1)
19.9%
The Vanguard Group
100 Vanguard Boulevard
Malvern,
Pennsylvania
19355
4,857,673
(2)
9.9%
BlackRock,
55 East 52
nd
Street
New York, New York 10022
2,899,304
(3)
5.9%
(1)
Everest Re Advisors, ltd., a direct wholly-owned subsidiary of the company had sole power to vote and direct the disposition
of 9,719,971 Common Shares as of December 31, 2022. According to the Company’s Bye-laws, the total voting power of any
Shareholder owning more than 9.9% of the Common Shares will be reduced to 9.9% of the total voting power of the Common
Shares.
(2)
The Vanguard Group reports in its Schedule 13G that it has no sole power to vote or direct the vote, shared voting power for
59,127 Common Shares, sole dispositive power with respect to 4,684,876 Common Shares and shared dispositive power with
respect to 172,797 Common Shares.
(3) BlackRock, Inc. reports in its Schedule 13G that it has sole power to vote or direct the vote of 2,617,745 Common Shares and sole
dispositive power with respect to 2,899,304 Common Shares.
Directors’ Compensation
46
2023 Proxy Statement
DIRECTORS’ COMPENSATION
Each member of the Board who is not otherwise affiliated with the Company as an employee and/or officer (“Non-
Employee Director” or “Non-Management Director”) was compensated in 2022 for services as a director and was
also reimbursed for out-of-pocket expenses associated with each meeting attended. Each Non-Employee Director is
compensated in the form of an annual retainer and a discretionary equity grant.
The Board reviews director compensation annually. In reviewing compensation, the Board considered several
factors, including the need to recruit and retain quality director candidates with expertise relevant to the Company’s
objectives and attuned to the increased regulatory and shareholder focus on Board governance and oversight.
The Board also considered the amount of time spent by directors in attending all scheduled Board and committee
meetings, preparing for meetings, communicating with management throughout the year and attending various
educational seminars. Our directors do not receive any additional compensation for service as a committee chair,
attending regular Board and committee meetings or special meetings of individual committees or the Board.
Each Non-Employee Director or Alternate attended the four scheduled meetings of the Board in 2022, as well as
an annual informational meeting in February to review and discuss corporate governance matters and long-term
strategic plans for the Company. Moreover, because we believe that a smaller board allows for greater exchange
of ideas and more focused and efficient interaction with management, each Non-Employee Director frequently
participates in every meeting of the Audit, Nominating and Governance, Compensation, Risk and Investment
Policy Committees, irrespective of whether the director is a formal appointee to such committee or an invitee of
the committee. Our directors believe they are at their most effective when working as a collective unit in sharing
ideas, offering opinions and engaging in spirited debate at all committee and Board meetings. Finally, various Non-
Employee Directors attend and report back to the Board on educational seminars relating to changes in accounting
rules and FASB pronouncements, tax regulations, ERM, governance best practices, information technology and
cyber security.
During our annual outreach in past years, several shareholders indicated that our director compensation program was
not in line with that of our peer group, primarily as a consequence of the heightened performance of the Company’s
share price as a result of our exceptional long-term performance. While the Board’s oversight directly contributed
to achieving the long-term value creation for shareholders, the Board took notice of our shareholders’ observations
and took action to bring its director compensation in line with our peers. The Board refined its director compensation
structure and implemented a limit on Non-Employee Director compensation to $450,000, comprised of a fixed cash
retainer and restricted share awards.
Each Non-Employee Director received a standard retainer of $125,000 in 2022 payable in the form of cash or
Common Shares at his or her election and an equity award equal in value to $325,000, for a total compensation value
of
$450,000. Giving Non-Employee Directors an opportunity to receive their standard retainer in the form of Common
Shares
is intended to further align their interests with those of the Company’s shareholders. The value of Common
Shares
issued is calculated based on the average of the highest and lowest sale prices of the Common Shares on each installment
date or, if no sale is reported for that day, the preceding day for which there is a reported sale. We believe
that these
revisions to the director compensation structure will bring total compensation per independent director more in
line with our peers while recognizing the contribution of our Board in building long-term shareholder value while
preserving the Board’s alignment of interest with our shareholders.
As a non-independent Chairman of the Board, Mr. Taranto provides enhanced duties more akin to an employee. Such
duties include consulting with the CEO to approve share buybacks; working with the CEO and the Corporate Secretary
scheduling, preparing agendas and ensuring information flow for Board meetings; recruitment and orientation of
new
directors; developing and maintaining business relationships beneficial to the Company at industry conferences
and
events; and providing support, advice and counsel on any special or extraordinary projects at the request of the Board.
Given Mr. Taranto’s enhanced duties including his availability to collaborate and work with the Company’s CEO that
go beyond his role as Chairman of the Board, effective January 1, 2021, Mr. Taranto entered into a non-executive,
part-time employment relationship with the Company’s affiliate, Everest Global, for a term of two years pursuant to
which he received an annual base salary of $425,000. Mr. Taranto’s employment with Everest Global was renewed
on January 1, 2023 for a two-year term, pursuant to which Mr. Taranto will receive an annual base salary of
$425,000.
As
an employee, Mr. Taranto is also eligible to receive an annual equity award at the discretion of the Board not to
exceed the value of any equity award granted to the non-executive members of the Board.
Directors’ Compensation
2023 Proxy Statement
47
The table below summarizes the compensation paid by the Company to Directors for the fiscal year ended
December 31, 2022.
6
2022 DIRECTOR COMPENSATION TABLE
Name
Fees
Earned or
Paid in
Cash
(1)
Share
Awards
(2)
Option
Awards
(3)
Non-Equity
Incentive Plan
Compensation
Change in
Pension Value
and
Nonqualified
Deferred
Compensation
Earnings
All Other
Compensation
(4)
Total
John J. Amore
$125,000
$325,663
—
—
—
$15,665
$466,328
William F. Galtney, Jr.
$125,000
$325,663
—
—
—
$15,665
$466,328
John A. Graf
$125,000
$325,663
—
—
—
$15,665
$466,328
Meryl Hartzband
$125,000
$325,663
—
—
—
$16,079
$466,742
Gerri Losquadro
$125,000
$325,663
—
—
—
$15,665
$466,328
Roger M. Singer
$125,000
$325,663
—
—
—
$25,665
$476,328
Joseph V. Taranto
(5)
$425,000
$325,663
—
—
—
$15,665
$766,328
John A. Weber
$125,000
$325,663
—
—
—
$25,665
$476,328
(1)
For their Board services in 2022, all of the directors elected to receive their compensation in cash except for Ms. Hartzband and Mr. Graf, who each
received 444 shares in compensation for their services.
(2)
The amount shown is the aggregate grant date fair value of the 2022 grant computed in accordance with Financial Accounting Standards Board
Statement Accounting Standards Codification Topic 718 (“FASB ASC Topic 718”) calculated by multiplying the number of shares by the fair market
value (the average of the high and low of the Company’s stock price on the NYSE on the date of grant) (“FMV”). Each of the Non-Employee Directors
was awarded 1,131 restricted shares on February 24, 2022 at FMV of $287.9425.
(3)
In July 2022, Mr. Amore exercised 454 option awards which had been awarded to him upon his appointment to the Board in September 2022.
(4)
Dividends paid on each director’s restricted shares. For Mr. Singer and Mr. Weber, also includes $10,000 in director fees for meetings attended as
directors of both Bermuda Re and International Re.
(5) Mr. Taranto’s
compensation
reflects
his
salary
and
share
awards
received
as
a
non-executive
employee
of
Everest
Global.
6
This 2022 Director Compensation Table excludes the compensation of Juan C. Andrade. The compensation of Mr. Andrade, a director and also
President and CEO of the Company, is set forth in the 2022 Summary Compensation Table. The 2022 Director Compensation Table does include the
compensation of Joseph V. Taranto, who is a non-executive employee of the Company.
Compensation Discussion and Analysis
48
2023 Proxy Statement
COMPENSATION DISCUSSION AND ANALYSIS
Executive Summary
The Company’s executive compensation program is intended to align the interests of our executive officers with
those of our shareholders. We stress merit-based performance awards and structure overall compensation to provide
appropriate incentives to executives to optimize net earnings and to increase book value per share. For 2022, Named
Executive Officers received annual awards based largely on such value-based financial performance metrics as
growth in book value per share and return on equity.
Our executive compensation program is designed and endorsed by the Compensation Committee. In designing the
Company’s
executive
compensation
program, the
Compensation
Committee
endeavors
to
reflect
the
core
objectives
of (i) attracting and retaining a talented team of executives who will provide creative leadership and ensure success
for the Company in a dynamic and competitive marketplace; (ii) supporting the execution of the Company’s business
strategy and the achievement of long-term financial objectives; (iii) creating long-term shareholder value; and (iv)
rewarding executives in a manner that is market competitive and seeks to incentivize executives to achieve long-term
profitable financial results.
We believe our compensation structure appropriately addresses the performance of our executive leadership team
in the face of significant global catastrophe activity for another consecutive year. The industry saw an estimated $115
billion of insured catastrophe losses in 2022, one of the highest catastrophe loss years on record, as a result of events
including Hurricane Ian and other events including European Hailstorms, Hurricane Fiona and Typhoon Nanmadol.
We provide our clients protection against risk and, accordingly, we expect intermittent volatility in our financial results.
Our executive compensation structure is designed to align management’s interest with our shareholders by incentivizing
long-term value creation rather than short-term gains through strategies designed to normalize catastrophe volatility
over the long-term. In that regard, as stewards of our shareholders’ capital, our portfolio management strategies seek to
minimize the impact of
severe events on our capital. Among other things, this is accomplished by maintaining a diversified
business portfolio – spread by line and geography – and by employing a tactical approach to managing risk, including,
but not limited to, de-risking our property exposures to reduce volatility during times of
inadequate pricing, utilizing third
party capital to leverage opportunity and issuance of
catastrophe
bonds. This is an important
distinction
as Everest
not
only outperforms during periods of benign catastrophe loss activity, but also performs well during periods of significant
catastrophe activity. Thus, despite yet another consecutive year of significant catastrophe activity, the Company was still
able to achieve positive earnings:
•
Gross
written
premiums
grew
to
$14
billion
from
$13
billion
in
2021.
•
The Company earned $1,065 million in after-tax operating income
7
representing a 10.6% after tax operating return
on equity (“ROE”)
8
.
•
The
Company
returned
$316
million
in
capital
to
shareholders
during
2022
as
follows:
– We
paid
quarterly
dividends
totaling
$255
million
in
2022.
– We
returned
$61
million
to
shareholders
through
share
repurchases.
7
The Company generally uses after-tax operating income (loss), a non-GAAP financial measure, to evaluate its performance. After-tax operating income
(loss) consists of net income (loss) excluding after-tax net gains (losses) on investments, after-tax net foreign exchange income (expense) and the tax
charge related to the enactment of the Tax Cuts and Jobs Act of 2017 (TCJA).
8
Further
explanation
and
a
reconciliation
of
net
income
(loss)
to
after-tax
operating
income
(loss)
can
be
found
at
the
back
of
the
Everest Annual
Report.
Compensation Discussion and Analysis
2023 Proxy Statement
49
Since going public in 1995, the Company has achieved compound annual growth in dividend-adjusted book value
per share of 10%.
* Including Stock Appreciation & Dividends
We have always emphasized prudent risk management and technical underwriting as the key tenets for building
and sustaining long-term value for our shareholders. Our compensation structure properly reflects management’s
alignment with our shareholders, especially during periods of extreme macroeconomic conditions including a global
pandemic, inflationary pressure, interest rate swings and volatile equities markets in conjunction with extreme natural
catastrophe events.
These results reinforce a strategic vision developed by experience, ingenuity and humility. While we are always mindful
of the human and economic tolls associated with all forms of natural catastrophe losses, we are in the business of
offering protection against volatility for our clients and customers while endeavoring to create long-term value for
our shareholders even during periods of extreme catastrophe activity. The fact that we have achieved consistent
book value per share growth over time showcases our ability to manage over cycles through successful underwriting
and
risk management strategies grounded in an innovative culture that values sustainable performance and capital
preservation. This unwavering commitment to long-term value creation for our shareholders is precisely the intent
behind our compensation philosophy.
Compensation Practices
50
2023 Proxy Statement
COMPENSATION PRACTICES
Compensation
Practices
and
2022
Say-On-Pay
Vote
Say on Pay
Say on Pay Results from
2017 to 2022
Everest received a high level of voting
approval,93.73%, for the Say on Pay advisory vote at
its 2022 Annual General Meeting. Accordingly, the
Committee did not make any significant changes to
the structure of the Company’s compensation
program
A primary focus of our Compensation Committee is ensuring that the Company’s executive compensation program
serves the best interests of our shareholders while appropriately rewarding our executive leadership for their
performance and seeks to incentivize executives to achieve long-term profitable financial results.
Our compensation program incorporates numerous compensation best practices that address common shareholder
concerns and advance the Company’s philosophy of long-term shareholder growth. Highlights include:
•
No separate change-in-control (“CIC”) agreement for the CEO
•
CEO and all participants in the CIC Plan are subject to double-trigger provisions
•
No “gross-up” payments by the Company of any “golden parachute” excise taxes upon a change-in-control
• Incentive
cash
bonuses
for
all
Named
Executive
Officers
tied
to
specific
Company
financial
performance
metrics
•
For 2022, approximately 41% of Named Executive Officers’ long-term incentive compensation (excluding any
Named Executive Officers no longer employed with the Company) is in the form of performance share units that
can only be earned upon satisfaction of specific Company financial performance metrics over a 3-year period
•
Say on Pay Advisory Vote considered by shareholders annually
• Stock
ownership
and
retention
guidelines
for
executive
vice
presidents
and
above
Compensation Practices
2023 Proxy Statement
51
* Total Stock Return Index is a measure of performance and is calculated as the change in share price plus reinvestment of dividends, assuming an
initial investment of $100.
Source: Nasdaq/Thomson
The Company’s Compensation Philosophy and Objectives
52
2023 Proxy Statement
THE COMPANY’S COMPENSATION PHILOSOPHY AND
OBJECTIVES
The Company’s executive compensation program is designed to attract, motivate and retain highly talented
individuals whose abilities are critical to the ongoing success of the Company. In this regard, the Company’s executive
compensation program utilizes a dual approach. In the first instance, the program has a short-term component
consisting of a base salary and a performance-based cash bonus predominantly tied to a Company financial metric.
Secondly, the Compensation Committee rewards long-term performance through the use of discretionary time-
based, as well as performance-based, equity awards tied to specific financial performance factors designed to closely
align the interests of key executives with the longer-term interests of the Company’s shareholders.
The Compensation Committee is guided by the following principles when making compensation decisions individually
and collectively with respect to our executives:
• Compensation of executive officers is based on the level of job responsibility, contribution to the performance of the
Company, individual performance in light of general economic and industry conditions, teamwork, resourcefulness
and
ability to manage our business.
• Compensation awards and levels are intended to be reasonably competitive with compensation paid by organizations
of similar stature to both motivate the Company’s key employees and minimize the potential for disruptive and
costly key employee turnover.
• Compensation is intended to align the interests of
the executive officers with those of
the Company’s shareholders
basing a significant part of total compensation on our executives’ contributions over time to the generation of
shareholder value.
The Company’s Compensation Philosophy and Objectives
2023 Proxy Statement
53
Components of the Company’s Compensation Program
Components of Executive Compensation
Short
Term
Compensation Component
Description
Key Features
Fixed component of
compensation intended to
attract and retain top talent
Generally positioned near the
median of our pay level peer group,
but varies with individual skills,
experience, responsibilities and
performance
At
-
Risk
Pay
Performance goals
established at the beginning
of each fiscal year that
support long-term growth
and operational efficiencies
Intended to motivate annual
performance with respect to
key financial measures,
coupled with individual
performance factors
For 2022, the maximum potential
bonus was tied to the Company
Adjusted ROE. Final awards also
consider achievement of individual
goals
All applicable Named Executive
Officers (“NEOs”) were selected as
participants in the Executive
Performance Annual Incentive Plan
(“Executive Incentive Plan”) for 2022
with the maximum bonus potential
available for award to any participant
in
the
Plan
not
to
exceed
$3.5
million
The total bonus determination for
a participant in 2022 is arrived at
by application of two independent
components based upon a 60%
and 40% weighting for all Named
Executive Officers: (1) Company
financial performance criteria and
(2) individual performance criteria as
set forth further herein.
No guaranteed minimum award
Long
Term
Long-Term Incentive Awards
At-risk, long-term, equity-
based compensation to
encourage multi-year
performance and retention
Intended to motivate long-
term performance with
respect to key financial
measures and align our NEOs’
interests with those of our
shareholders
Tied to the rate of annual operating
ROE and TSR relative to our peer
group over a three-year period,
along with annual TSR against
targets for the 2022 PSU
Payouts range from 0% of target
payout to 175% of target payout,
depending on performance after 3
years
Intended to motivate long-
term performance and value
creation, align our NEOs’
interests with shareholders’
interests and promote
retention
Vests at the rate of 20% per year after
anniversary of grant over a five-year
period
The Company’s Compensation Philosophy and Objectives
54
2023 Proxy Statement
The Compensation Committee meets each February to review and approve compensation for each Named Executive
Officer including any adjustments to base salary, bonus awards and equity grants in consideration of the officer’s
prior fiscal year’s performance as well as performance over time. In addition, from time to time, the Compensation
Committee may make separate salary adjustments to Named Executive Officers during the course of the year to
recognize mid-year promotions, changes in job functions and responsibilities, or other circumstances.
As shown in the charts below, the Compensation Committee manages the pay mix for our executive officers such
that a substantial portion is “at risk” compensation so as to better align the interests of our Named Executive Officers
with the Company’s shareholders. The average of all Named Executive Officers’ at-risk compensation was 80%. The
amounts above and in the chart below do not include the amounts set forth in the columns labeled “Change in
Pension Value and Nonqualified Deferred Compensation Earnings” and “All Other Compensation” in the Summary
Compensation Table.
In addition, all employees including executive officers received other compensation in the form of benefits. Such
other compensation included Company-paid term life insurance, partially subsidized medical and dental plans,
Company-paid disability insurance and participation in a Company-sponsored 401(k) employee savings plan. Certain
executives also participated in a Supplemental Savings Plan whose purpose is principally to restore benefits that
would otherwise have been limited by U.S. benefit plan rules applicable to the 401(k) employee savings plan.
The Role of Peer Companies and Benchmarking
The Compensation Committee identified a peer group comprised of companies that are similar to us in industry and
size for purposes of benchmarking and evaluating the competitiveness of our pay levels and compensation packages
our Named Executive Officers. In determining the final peer group, the Compensation Committee selected
publicly
traded
insurers
and
reinsurers
that
directly
compete
with
the
Company
for
business
and
talent, and
changes
the Company’s peer group have been primarily due to consolidations among several peer group companies in
recent years. The Compensation Committee reviews both compensation and performance at peer companies as a
benchmark when setting compensation levels that it believes are commensurate with the Company’s performance.
Although the Committee did not set compensation components to meet specific benchmarks, such as targeting
salaries
“above
the
median”
or
equity
compensation
“at
the
75th
percentile”
of
peer
companies
at
the
outset
of
2022,
it
did
utilize
the
peer
group
compensation
data
in
determining
appropriate
incentive
compensation
amounts
relative
individual and Company performance awarded to our Named Executive Officers for the 2022 fiscal year. Further, the
Committee utilized such peer group metrics in setting Named Executive Officer targets for the 2022 fiscal year.
The Company’s Compensation Philosophy and Objectives
2023 Proxy Statement
55
For 2022, the Committee selected the following companies to serve as our pay level peer group:
Alleghany Corporation
Cincinnati
Financial
Corporation
The Hartford Financial Services Group, Inc.
Arch Capital Group, Ltd.
Markel Corporation
W.R. Berkley Corporation
Axis
Capital
Holdings,
Limited
Renaissance
Chubb Limited
The Hanover Insurance Group, Inc.
Base Salary and Bonus Determinations
The base salaries for all executive officers are determined by the Compensation Committee, established upon hire
or
assignment date and reconsidered annually or as responsibilities change. In setting an executive’s initial base salary, the
Compensation Committee considers the executive’s abilities, qualifications, accomplishments and prior experience.
The Compensation Committee also considers base salaries of similarly situated executive officers in its identified peer
companies when assessing competitive conditions in the industry. Subsequent adjustments to the executive’s base
salary in the form of annual raises or upon renewal of an employment agreement take into account the executive’s
prior performance, the financial performance of the Company and the executive’s contribution to the Company’s
performance over time, as well as competitive conditions in the industry.
Incentive Based Bonus Plans
In connection with fiscal year 2022 performance, the Company awarded annual performance-based cash bonuses to
the applicable Named Executive Officers pursuant to the Executive Performance Annual Incentive Plan.
Executive Performance Annual Incentive Plan
The Compensation Committee identifies the executive officers eligible to participate in the Executive Incentive Plan.
In addition to other criteria, the Executive Incentive Plan provides that the total amount of awards granted to all
participants in any one year may not exceed 10% of the Company’s average annual income before taxes for the
preceding five years.
Pursuant to the terms of the Executive Incentive Plan, the Compensation Committee, within 90 days after the
beginning of the fiscal year, selects those executive officers of the Company and its subsidiaries who will participate
in the Executive Incentive Plan for that year. The Compensation Committee sets maximum potential bonus amounts
for each participant based on achievement of specific performance criteria, chosen from among the performance
criteria set forth in the Executive Incentive Plan, that most closely aligns Company financial performance to long-
term shareholder value creation. The Compensation Committee may exercise discretion and award an amount that
is less than the potential maximum amount to reflect actual corporate, business unit and individual performance. The
Compensation Committee determined that the maximum potential bonus for Mr. Andrade and any participant in the
Executive Incentive Plan cannot exceed $3.5 million. For Messrs. Karmilowicz, Kociancic, Mukherjee and Williamson,
their maximum potential bonus is further limited to 200% of their respective base salaries, subject to the foregoing
$3.5 million cap. In addition, and subject to the foregoing maximums, the total bonus determination for a participant
in 2022 is arrived at by application of two independent components based upon a 60% and 40% weighting for the
Named Executive Officers: (1) Company financial performance criteria and (2) individual performance criteria. For
each applicable Named Executive Officer, the Compensation Committee established full-year operating plan ROE
targets for the Company as the financial performance criteria to be applied in connection with a portion of their
bonus compensation. Further, for each Named Executive Officer, the Compensation Committee considers 60% of
the
potential maximum bonus eligible to be earned based on tiered Company Adjusted Operating ROE
9
results above
and below the set operating plan ROE target. In determining that only the above percentages of the maximum bonus
should be tied to achievement of these additional financial performance metrics, the Committee desired to preserve
financial metrics as being the predominant determinant of whether a participant had earned the maximum bonus
potential.
9
Adjusted Operating ROE adjusts actual operating ROE by limiting catastrophe activity to 40% of anticipated catastrophe losses in the annual operating
plan and 60% of actual catastrophe losses for the current fiscal year.
The Company’s Compensation Philosophy and Objectives
56
2023 Proxy Statement
The Compensation Committee separately considers the remaining 40% of the potential maximum bonus eligible to
be earned by a participant based upon successful achievement of
individual generally non-financial goals established
each participant. Consideration of individual performance is done to acknowledge that the property and casualty
(re)insurance business is a risk-based endeavor where a company’s financial results in any one financial year may
be impacted by exogenous factors beyond human control such as an unexpected severe hurricane season or other
natural peril catastrophe activity. Implicit in such a determination is the recognition that our financial success over the
long term is not dependent on any one financial year’s results. Individual goals in any given year include, but are not
limited to, factors that may be applicable to each NEO, such as demonstrated leadership, ESG and diversity, business
year highlights, risk management and loss mitigation protection practices, strategic goal setting, performance against
annual operating plan, capital management, strategic expansion initiatives and growing Everest’s investor base.
Finally, the 40% subjective element also allows the Compensation Committee broad discretion to consider market
performance measures such as total shareholder return (“TSR”) into executive performance without setting a specific
performance target.
This balanced approach allows the Company to remain competitive and foster retention of highly performing Named
Executive Officers. Further, the Committee is not bound to any minimum bonus amount and retains discretion to scale
the payments below the potential maximum bonus and to award no cash bonus to any Named Executive Officer.
The Compensation Committee in February 2022 selected Messrs. Andrade, Karmilowicz, Kociancic, Mukherjee and
Williamson to participate in the Executive Incentive Plan for fiscal year 2022, which tied their maximum potential
bonus awards to the performance criteria as described in more detail below.
2022 INCENTIVE-BASED BONUS TARGETS AND AWARDS
Named Executive Officer
Target
Incentive
Bonus
(% Base
Salary)
Target
Incentive
Bonus
Potential
Maximum
Incentive
Bonus
Actual
Bonus
Award
Juan C. Andrade CEO
220%
$
2,750,000
$
3,500,000
$
2,900,000
Mike Karmilowicz
Executive Vice President and CEO of Everest
Insurance
®
130%
1,007,500
1,550,000
$
1,070,750
Mark Kociancic
Executive Vice President & Chief Financial Officer
130%
1,137,500
1,750,000
$
1,273,900
Sanjoy Mukherjee
Executive Vice President, General Counsel &
Secretary
130%
845,000
1,300,000
$
900,000
Jim Williamson
Executive Vice President, Chief Operating Officer
and Head of Reinsurance
130%
1,040,000
1,600,000
$
1,167,000
TOTAL
$
6,780,000
$
9,700,000
$
7,311,650
Long-Term Compensation Determinations
The second component of the Company’s executive compensation plan is premised on a strategic view of
compensation. This long-term compensation component is achieved through the 2020 Stock Incentive Plan. Awards
under the 2020 Stock Incentive Plan are generally intended to reinforce management’s long-term emphasis on
corporate performance, provide an incentive for key executives to remain with the Company for the long term and
provide a strong incentive for employees to work to increase shareholder value by aligning employees’ interests with
those of the shareholders.
Equity awards may take the form of share options, share appreciation rights, restricted shares or performance share
units. Options and restricted shares are awarded on the day that they are granted by the Compensation Committee
and valued as of the grant date. Options are issued with an exercise price equal to the fair market value of the
Company’s stock on the grant date. The Company determines fair market value by averaging the high and low market
price on the grant date.
The Company’s Compensation Philosophy and Objectives
2023 Proxy Statement
57
With respect to the equity award process, the CEO makes recommendations to the Compensation Committee for each
eligible executive officer, and the proposed awards are discussed with and reviewed by the Compensation Committee.
While the Compensation Committee takes into account management’s input on award recommendations, all final
determinations are in the subjective judgment and discretion of the Compensation Committee. In determining the
final award amounts, the Compensation Committee reviews each recipient’s demonstrated past and expected future
individual performance, his/her contribution to the financial performance of the Company over time, the recipient’s
level of responsibility within the Company, his/her ability to affect shareholder value and the value of past share
awards. Finally, the Compensation Committee also considers the value of equity awards granted to similarly situated
executive officers by our pay level peer group in order to ensure a competitively attractive overall compensation
package.
Equity grants are made at the Compensation Committee’s February meeting. There is no plan or practice to grant
equity awards in coordination with the release of material non-public information. Additionally, the Company’s Ethics
Guidelines and Insider Trading Policy prohibit our executive officers, directors and other employees from trading in
options in the Company’s shares. Prohibited options include options awarded under the 2020 Stock Incentive Plan,
as well as any expired stock incentive plans, “put” options and “call” options. Further, “[t]he Company’s anti-hedging
policy prohibits its officers, directors or other employees from engaging in transactions geared toward ‘shorting’
the Company’s stock or trading in straddles, equity swaps or other derivative securities that are directly linked to
the Company’s common shares.” The foregoing anti-hedging policy is part of the Company’s “Inside Information
and Restrictions on Trading” section of the Company’s Ethics Guidelines, which provides a series of restrictions
applicable to all transactions in Company stock and other classes of securities by directors, officers and employees
of the Company (as well as to others living in the same household as such people). There is no category of hedging
transaction relevant to the Company’s securities that is specifically permitted as to any officers, directors or other
employees of the Company. The Board has adopted stock ownership and retention guidelines for all senior officers
with the title of Executive Vice President or above, in order to further align the personal interests of these executives
with those of our shareholders.
Time-Vested Share Awards
We believe that restricted shares, share options and performance share unit awards encourage employee retention
and reward consistent long-term shareholder value creation. Such awards vest over a five-year period at the rate
of 20% per year for the Named Executive Officers and are generally forfeited if the recipient leaves the Company
before vesting. Furthermore, the expiration of share options ten years after they are granted is designed to encourage
recipients to work towards maximizing the Company’s growth over the long-term and not simply cater to short-term
profits.
Performance Share Units
The Compensation Committee grants annual performance-based equity awards to Named Executive Officers in the
form of Performance Share Units (“PSU”) that can only be earned upon the achievement of certain Company financial
metrics measured over three one-year performance periods based on annual goals and one three-year performance
period based on goals measured over that period. At fiscal year-end 2022, we completed the third and final year
of the PSU performance period for our 2020 awards, the second year of the PSU performance period for our 2021
awards and the first year of the PSU performance period for our 2022 awards. For the 2020, 2021 and 2022 PSU, the
performance
period
was
January
1,
2020
through
December
31,
2022,
January
1,
2021
through
December
31,
2023
and
January
1,
2022
through
December
31,
2024,
respectively.
Each PSU gives the participant the right to receive up to 1.75 shares upon settlement at the end of the three-year
performance period based upon satisfaction of certain financial performance targets. For the 2020 PSU, the shares
represented by the PSU may only be earned upon the satisfactory achievement of two financial performance metrics:
cumulative Book Value Per Share (“BVPS”) growth measured against peers over a three-year period and Operating
Return on Equity. For the 2021 PSU, a third performance metric was introduced: annual BVPS growth measured
against targets set by the Compensation Committee. The Compensation Committee elected to use BVPS as one of
the financial metrics for the PSU because this metric correlates with long-term shareholder value. BVPS is defined as
the tangible book value of a share as determined under GAAP, adjusted for dividends paid to shareholders during the
performance period. For purposes of calculating the new third metric for the 2021 PSU, annual BVPS growth measured
against targets set by the Compensation Committee, BVPS is calculated in the same manner, except excluding any
adjustment for dividends paid to shareholders. For the 2022 PSU, the Compensation Committee elected to use Total
Shareholder Return for the relative measure for performance period 2022-2024 instead of change in BVPS relative to
peer groups.
The Company’s Compensation Philosophy and Objectives
58
2023 Proxy Statement
Operating Return on Equity (“Operating ROE”), for purposes of PSU awards, is defined as operating income divided by
average adjusted shareholders’ equity. In setting the target metric for the 2022 performance year, operating income
equals net income/(loss) attributable to the Company, excluding after-tax net realized capital gains/(losses). Average
adjusted shareholders’ equity equals the average of beginning-of-period and end-of-period shareholders’ equity,
excluding the after-tax net unrealized appreciation/(depreciation) on investments recorded in accumulated other
comprehensive income. The Compensation Committee selected Operating ROE as one of the financial metrics for
the PSU because this metric correlates closely with shareholder value over both intermediate and longer-term periods
and
is a widely-used financial metric in the insurance and reinsurance industry for assessing company performance. The
tables below set forth the 2020, 2021 and 2022 PSU Target Awards for each NEO and performance measures.
Named Executive Officers
Target
Award
Juan C.
Andrade
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
2020
PSU
6,770
780
—
1,150
—
2021
PSU
8,260
1,355
2,045
1,610
1,435
2022
PSU
7,050
1,340
1,755
1,360
1,410
2020 PSU TARGET MEASURES
Award Multiplier
Weight
Performance
Year
Target
ROE
0%
25%
100%
175%
Operating ROE
60.0%
2020
11.1%
<4.1%
4.1%
11.1%
>=16.1%
2021
11.1%
<4.1%
4.1%
11.1%
>=16.1%
2022
12.4%
<5.4%
5.4%
12.4%
>=17.4%
Award Multiplier
Weight
Performance
Period
Target
0.0%
25%
100%
175%
3Yr Relative Change in
BVPS to Peers
40.0%
2020–2022
Median
<26th
26th %tile
Median
>=75th %tile
2021 PSU TARGET MEASURES
Award Multiplier
Weight
Performance
Year
Target
ROE
0%
25%
100%
175%
Operating ROE
50.0%
2021
11.1%
<4.1%
4.1%
11.1%
>=16.1%
2022
12.4%
<5.4%
5.4%
12.4%
>=17.4%
Award Multiplier
Weight
Performance
Year
Target
Growth
0%
25%
100%
175%
Growth in BVPS
25.0%
2021
8%
<3.0%
3%
8%
>=13.0%
25.0%
2022
10.5%
<5.5%
5.5%
10.5%
>=15.5%
Award Multiplier
Weight
Performance
Period
Target
0.0%
25%
100%
175%
3Yr Relative Change in
BVPS to Peers
25.0%
2021–2023
Median
<26%tile
26%tile
Median
>=75%tile
The Company’s Compensation Philosophy and Objectives
2023 Proxy Statement
59
2022 PSU TARGET MEASURES
Award Multiplier
Weight
Performance
Year
Target
ROE
0%
25%
100%
175%
Operating ROE
50.0%
2022
12.4%
<5.4%
5.4%
12.4%
>=17.4%
Award Multiplier
Weight
Performance
Year
Target
Growth
0%
25%
100%
175%
TSR
25.0%
2022
13%
<8%
8%
13%
>=18%
Award Multiplier
Weight
Performance
Period
Target
0.0%
25%
100%
175%
3Yr TSR Compared to
Peers
25.0%
2022-
2024
Median
<26%tile
26%tile
Median
>=75%tile
As displayed above, the portions of the 2020, 2021 and 2022 PSU grants that are subject to the Operating ROE
financial metric (60% for the 2020 PSU and 50% for the 2021 and 2022 PSU) are eligible to be earned annually in
one-third tranches over the three-year performance period based upon target Operating ROE figures determined by
the Committee annually. In setting the 2022 Operating ROE target, the Committee considered the Company’s 2022
operating business plan reflecting management’s view of market conditions, modeled expected results, business mix
and
product diversification and the continued global economic uncertainty relating to the Pandemic.
The Committee further noted that the 12.4% target Operating ROE for 2022 represented an increase over the prior
year’s result of 12.2%. In recent years, the Compensation Committee has generally set higher Operating ROE targets
compared to the previous year’s actual Operating ROE results
10
in order to continue to set a high level of achievement
for
executive management, as demonstrated in the following table:
Year
Target ROE (%)
Actual ROE (%)
2017
10
4.6
2018
11
2.3
2019
12.2
10.3
2020
11.1
8.4
2021
11.1
12.2
2022
12.4
10.6
For the 2022 annual performance period, the Committee set a target Operating ROE of 12.4% with one-third of the
applicable Named Executive Officers’ 2020, 2021 and 2022 PSU eligible to be earned as measured by the Company’s
year performance from January 1, 2022 through December 31, 2022. Earn-outs between the performance levels are
determined by straight-line interpolation.
The tables below set forth the amount of 2020, 2021 and 2022 PSU eligible to be earned to date by each applicable
NEO based upon Operating ROE. The earn-out reflects the percentage of the total target award that can be earned in
any one performance period which is one third of 50% (i.e., 16.7%) of the NEO’s total PSU target award for the 2021
and 2022 PSU and one third of 60% (i.e., 20%) for the 2020 PSU. The number of shares actually earned is calculated
by applying the target award multiplier based upon the Company’s full year performance:
10
For the 2020 period only with respect to the 2020 PSU award calculations, the Actual Operating ROE of 8.4% stated herein was determined after
adjusting to exclude COVID-19 related losses, as further detailed in Everest’s April 9, 2021 proxy statement. No further COVID-19 related adjustments
Actual Operating ROE were made for the 2021 and 2022 years.
The Company’s Compensation Philosophy and Objectives
60
2023 Proxy Statement
2020 PSU ROE Grant
OPERATING ROE
Juan C.
Andrade
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
Target
Award
Target
Award
Target
Award
Target
Award
Target
Award
6,770
780
N/A
1,150
N/A
Target
Actual
Earn
Out %
Target
Multiplier
Earned
PSU
Earned
PSU
Earned
PSU
Earned
PSU
Earned
PSU
2020 Period
11.1%
8.4%
20%
71.1%
963
111
—
164
—
2021 Period
11.1%
12.2%
20%
116.5%
1,578
182
—
268
—
2022 Period
12.4%
10.6%
20%
80.7%
1,093
126
—
186
—
2021 PSU ROE Grant
OPERATING ROE
Juan C.
Andrade
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
Target
Award
Target
Award
Target
Award
Target
Award
Target
Award
8,260
1,355
2,045
1,610
1,435
Target
Actual
Earn
Out %
Target
Multiplier
Earned
PSU
Earned PSU
Earned
PSU
Earned
PSU
Earned
PSU
2021 Period
11.1%
12.2%
16.7%
116.5%
1,604
264
398
313
279
2022 Period
12.4%
10.6%
16.7%
80.7%
1,111
183
275
217
193
2022 PSU ROE Grant
OPERATING ROE
Juan C.
Andrade
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
Target
Award
Target
Award
Target
Award
Target
Award
Target
Award
7,050
1,340
1,755
1,360
1,410
Target
Actual
Earn
Out %
Target
Multiplier
Earned
PSU
Earned PSU
Earned
PSU
Earned
PSU
Earned
PSU
2022 Period
12.4%
10.6%
16.7%
80.7%
949
181
236
183
190
All earned shares resulting from achievement of the metrics herein are delivered to the participant upon the
Committee’s confirmation of the final earned amounts at the end of each of the 2020, 2021 and 2022 PSU respective
three-year performance periods.
2021 PSU BVPS Growth Against Target Grant
For the 2022 PSU, the Compensation Committee used growth in BVPS measured against targets selected by the
Compensation Committee as a metric. The growth in BVPS award metrics determined by the Committee in February
2023 are as follows:
2021 Growth in BVPS Award
Juan
Andrade
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
Target
Award
Target
Award
Target
Award
Target
Award
Target
Award
8,260
1,355
2,045
1,610
1,435
Target
Actual
Earn
Out %
Award
Multiplier
Earned
PSU
Earned PSU
Earned
PSU
Earned
PSU
Earned
PSU
2021 Period
8%
12%
8.3%
160%
1,102
181
273
215
192
2022 Period
10.5%
2.8%
8.3%
0%
0
0
0
0
0
The Company’s Compensation Philosophy and Objectives
2023 Proxy Statement
61
2020-22 PSU BVPS Growth Against Peers Grant
The PSU eligible to be earned based upon the relative BVPS growth against peers are benchmarked against a selected
peer group, as measured cumulatively from January 1, 2020 through December 31, 2022 for the 2020 PSU and January
1, 2021 through December 31, 2023 for the 2021 PSU. For the 2022 PSU awards, the Committee determined that the
following companies shall serve as the peer group for purposes of determining the BVPS growth achievement:
Alleghany Corporation
Cincinnati
Financial
Corporation
The Hartford Financial Services Group, Inc.
Arch Capital Group, Ltd.
Markel Corporation
W.R. Berkley Corporation
Axis
Capital
Holdings,
Limited
Renaissance
Chubb Limited
The Hanover Insurance Group, Inc.
Companies that are no longer listed on a public exchange (e.g., due to
acquisition
or merger) during the
measurement
periods are omitted from the cumulative relative BVPS growth benchmarking from inception of the measurement periods.
Earn-outs between target levels for PSU subject to the BVPS growth metric are also determined by straight-line
interpolation and will be certified by the Committee for eligibility at the end of the 2020 and 2021 PSU three-year
performance periods (on or before March 15, 2022 and March 15, 2023, respectively to the 2020 and 2021 PSU).
For the 2020 PSU, the BVPS growth metrics determined by the Committee in February 2023 are as follows:
2020 PSU Growth in BVPS
against Peers
Juan
Andrade
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
Target
Award
Target
Award
Target
Award
Target
Award
Target
Award
6,770
780
N/A
1,150
N/A
Weight
Award
Multiplier
Earned PSU
Earned PSU
Earned PSU
Earned PSU
Earned PSU
2020-2022
Period
40.0%
118%
3,196
369
—
543
—
As a result, the total 2020 PSU earned, taking into account satisfactory achievement of the two financial performance
metrics is as follows:
Juan
Andrade
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
2020 PSU Target Award
6,770
780
1,150
—
Total 2020 Operating ROE PSU Earned
3,634
419
618
—
Total 2020 BVPS PSU Earned
3,196
369
543
—
Total PSU Earned
6,830
788
N/A
1,161
N/A
PSU shares not earned because of failure to achieve the set metrics are forfeited. All earned shares resulting from
achievement of the metrics are delivered to the participant upon confirmation by the Committee of the final earned
amounts at the end of the PSU three-year performance period.
2022 PSU TSR Against Target Grant
For the 2022 PSU, as noted above, the Compensation Committee decided to change the metric Relative Change in
Tangible BVPS to Total Shareholder Return on a go-forward basis. The growth in TSR award metrics determined by the
Committee in February 2023 are as follows:
2022 TSR Award
Juan
Andrade
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
Target
Award
Target
Award
Target
Award
Target
Award
Target
Award
7,050
1,340
1,755
1,360
1,410
Target
Actual
Earn
Out %
Award
Multiplier
Earned
PSU
Earned
PSU
Earned
PSU
Earned
PSU
Earned
PSU
2022 Period
13%
5.4%
8.3%
0%
0
0
0
0
0
The Company’s Compensation Philosophy and Objectives
62
2023 Proxy Statement
2022-24 PSU TSR Against Peers Grant
The PSU eligible to be earned based upon the relative TSR growth against peers are benchmarked against a selected
peer group, as measured cumulatively from January 1, 2022 through December 31, 2024 for the 2022 PSU. For
the 2022 PSU awards, the Committee determined that the following companies shall serve as the peer group for
purposes of determining the TSR growth achievement:
Alleghany Corporation
Cincinnati
Financial
Corporation
The Hartford Financial Services Group, Inc.
Arch Capital Group, Ltd.
Markel Corporation
W.R. Berkley Corporation
Axis
Capital
Holdings,
Limited
Renaissance
Chubb Limited
The Hanover Insurance Group, Inc.
Companies that are no longer listed on a public exchange (e.g., due to acquisition or merger) during the measurement
periods are omitted from the cumulative relative TSR growth benchmarking from inception of the measurement
periods.
Earn-outs between target levels for PSU subject to the TSR growth metric are also determined by straight-line
interpolation and will be certified by the Committee for eligibility at the end of the 2022, 2023 and 2024 PSU
three-year performance periods (on or before March 15, 2023 and March 15, 2024, respectively, with respect to
the 2022 PSU).
For the 2022 PSU, the TSR growth metrics determined by the Committee are as follows:
2022 PSU TSR
Against Peers
Juan
Andrade
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
Target
Award
Target
Award
Target
Award
Target
Award
Target
Award
7,050
1,340
1,755
1,360
1,410
Weight
Award
Multiplier
Earned
PSU
Earned PSU
Earned
PSU
Earned PSU
Earned
PSU
2022-2024
Period
25.0%
TBD
TBD
TBD
TBD
TBD
TBD
Named Executive Officer Compensation
The final amounts and factors considered by the Compensation Committee in making its decisions with regard to the
2022 performance year for each Named Executive Officer are described more fully below. Although the Compensation
Committee establishes certain Company performance metrics, targets and ceilings on cash bonuses for each Named
Executive Officer, the Compensation Committee feels that an effective compensation program must be linked to
the Company’s performance and value generated for shareholders over the long-term. In this regard, performance-
measuring metrics are limited to those measurements that are deemed especially important to creating shareholder
value, while retaining the flexibility to also make awards based on subjective criteria.
The Compensation Committee’s philosophy is to encourage management to act in the best interests of the Company
and
our shareholders even when such actions may temporarily reduce short-term profitability, for example:
• investments
in
our
business
in
the
form
of
human
capital
and
intellectual
resources;
•
reserving methodologies and reserve positions;
• diversification
of
risk
within
our
insurance
and
reinsurance
portfolios;
•
capital management strategies;
• long-term
strategic
growth
initiatives;
and
•
creativity in the development of new products.
Furthermore, the Committee recognizes that the (re)insurance industry is cyclical and often volatile and susceptible
to uncontrollable exogenous factors beyond human control. Consequently, although the Compensation Committee
places greater weight on financial performance factors and targets when evaluating an individual executive’s
performance, it also identifies certain individual goals tailored to an individual’s role and responsibilities when
assessing the overall performance of Named Executive Officers.
The Company’s Compensation Philosophy and Objectives
2023 Proxy Statement
63
Company Financial Performance Assessment
The Compensation Committee assesses the financial performance of the Company in the context of the business
environment in which it operates, the performance of competitors with reasonably comparable operations and against
management’s operating business plan for the period under review. The Compensation Committee also considers
management’s decisions and strategies deployed in positioning the Company for future growth and profitability. Our
compensation program is designed to reward executive officers for developing and achieving a business strategy
that emphasizes creation of longer-term shareholder value.
The Compensation Committee attaches significant importance to our executives’ ability to generate shareholder
value over time by achieving an attractive increase in dividend-adjusted book value per common share and in the
achievement of returns that provide an attractive compound growth rate in shareholder return. Through fiscal year
2022, the Company has generated compound annual growth rate of 10% per year since going public in 1995 and
achieved total return over the S&P 500 of 1,380 points.
This attractive long-term performance has been achieved during a period of significant natural catastrophe activity, a
protracted period of very low interest rates as well as repeated periods of soft market conditions.
Financial Performance Measures Linking CEO and NEO Compensation to Company Performance
in 2022
When analyzing the performance and considering the overall compensation of our Named Executive Officers, the
Compensation Committee reviews the Company’s operational, strategic and financial performance over the short-
and long-term periods. As noted above, in linking executive pay to Company performance, the Compensation
Committee selected the key Company financial performance metrics of Operating ROE and Total Shareholder Return
in the incentive cash bonus and performance share awards pursuant to the Executive Incentive Plan and Performance
Share Units, respectively. In addition to these key financial performance indicators, the Compensation Committee
also identified additional financial metrics as most important in linking executive pay to Company performance.
These additional financial indicators are not necessarily tied to any one specific short-term financial target, but rather
serve to incentivize management to focus on long-term value creation.
For 2022, the Compensation Committee identified Attritional Combined Ratio, Operating Expense Ratio, Average
Rating Agency Financial Strength Rating and Gross Written Premium Growth Rate as the most important financial
measures linking PEO and NEO compensation to Company performance. The importance of these financial
performance indicators to our shareholders is reflected in their incorporation as the baseline targets for the Company’s
May 2021 Investor Day presentation and three- year strategic plan. Management’s ability to meet these Investor Day
performance targets were factored into the determination of the overall short-term incentive-based compensation
awarded to the CEO and NEOs.
In 2022, despite another consecutive year of significant global catastrophe activity, Everest delivered strong results in line
with our strategic plan and continuing focus on prudent risk management, disciplined underwriting and profitable growth.
The Compensation Committee took subjective note of executive management’s role in shaping 2022 results
against
challenging market dynamics
The Company’s Compensation Philosophy and Objectives
64
2023 Proxy Statement
Investor Day Financial Targets
At Everest’s inaugural May 2021 Investor Day, Everest set ambitious financial targets for its three-year (2021–2023)
strategic plan, including the metrics below. In determining executive compensation for 2022, the Compensation
Committee took note of executive management’s significant progress toward the Investor Day targets.
Key Financial Target
2022 Results and Progress Toward Financial Targets
2023 Total Shareholder Return (“TSR”) greater than
13%, with near-term results of approximately 11%
Everest achieved TSR of 5.4% for 2022 despite significant
global catastrophe activity and challenging macroeconomic
conditions of inflation and public equities market volatility.
10 to 15% gross written premium Compound
Annual Growth Rate (“CAGR”) from 2021 through
2023, with the Reinsurance Division contributing
8 to 12% CAGR for that time-period and the
Insurance Division contributing 18 to 22% CAGR
In 2022, Everest achieved 6.9% overall gross written premium
year over year growth from 2021.
The Reinsurance Division achieved 2.7% growth in 2022, while
the Insurance Division achieved 16.4% growth.
Low 90’s combined ratio by 2023
In 2022, Everest achieved a combined ratio of 96% and an
attritional combined ratio of 87.4%.
The Reinsurance Division delivered a 96.4% combined ratio and
an attritional combined ratio of 86.2%. The Insurance Division
delivered a 94.8% combined ratio and an attritional combined
ratio of 90.4%.
Individual Performance Assessment Factors
In evaluating individual performance, the Compensation Committee subjectively considers the following qualitative
individual factors:
• executive
officer’s
individual
performance
in
his/her
area
of
responsibility;
• individual
effort
in
achieving
company
goals;
• effectiveness
in
fostering
and
working
within
a
team-oriented
approach;
• creativity,
demonstrated
leadership
traits
and
future
potential;
•
level of experience; and
• total
compensation
relative
to
the
executive’s
internal
peers.
No single individual performance factor is given materially more weight than another, although all are considered
in the context of an executive’s overall performance. Rather, these factors are representative of the qualities that we
believe make an effective executive.
The Company’s Compensation Philosophy and Objectives
2023 Proxy Statement
65
Summary of Direct Compensation Awarded in 2022
The cash and equity compensation components for each Named Executive Officer relating to fiscal year 2022
performance are highlighted in the table below. This table is provided to better assist shareholders in understanding
Compensation Committee’s specific decisions on individual performance-based compensation relating to the
2022 fiscal year, exclusive of any benefits or pension or retirement related deferred compensation that is not
performance related. This table differs from the SEC disclosure rules reflected in the “Summary Compensation Table”
primarily by disclosing equity awards granted at the Board’s February 2023 meeting.
Name
Title/Business
Annual
Base
Salary
Incentive
Cash
Bonus
Time-
Vested
Equity
Award
Performance-
Based
Equity Award
Total Direct
Compensation
Juan C. Andrade
President and CEO
$
1,250,000
$
2,900,000
$
2,375,000
$
2,375,000
$
8,900,000
Mike Karmilowicz
Executive Vice
President and CEO of
Everest Insurance
®
$
775,000
$
1,070,750
$
875,400
$
399,600
$
3,120,750
Mark Kociancic
Executive Vice
President and Chief
Financial Officer
$
875,000
$
1,273,900
$
1,180,500
$
509,500
$
3,838,900
Sanjoy Mukherjee
Executive Vice
President and General
Counsel, Secretary
$
650,000
$
900,000
$
585,000
$
390,000
$
2,525,000
Jim Williamson
Executive Vice
President, Chief
Operating Officer and
Head of Reinsurance
$
800,000
$
1,167,000
$
940,400
$
419,600
$
3,327,600
Incentive Cash Bonus
All NEOs were selected by the Compensation Committee at its February 2022 meeting to participate in the Executive
Incentive Plan for fiscal year 2022. Under the Executive Incentive Plan, total bonus determination for a participant
is arrived at by application of two independent components: (1) Company financial performance criteria and (2)
individual performance criteria. These components are further weighted 60% financial criteria and 40% individual
performance criteria.
For 2022, the Compensation Committee adopted the 2022 operating plan ROE as the target financial performance
metric. Although several shareholders indicated a preference for multiple financial metrics to measure performance,
Compensation Committee believes that for (re)insurance companies such as Everest whose ultimate success in
value
creation and sustainability derive from disciplined underwriting, prudent risk management and careful exposure analysis
in maximizing capital efficiency, Operating ROE is the key performance indicator that ties each of these value
components
together. Even as a single measurement metric, Operating ROE provides a holistic measurement of operating
performance because Operating ROE encompasses the results of key individual performance indicators including
growth strategy, revenue, loss ratio, expense management and combined ratio. Further, it removes any short-term
incentive for management to maximize any one particular metric in a given year.
In setting the Operating ROE financial performance criteria for the non-equity incentive compensation, the
Compensation Committee determined that the targets were fair yet demanding in consideration of:
• the
2022
operating
plan,
•
the average operating return on equity achieved over several market cycles,
•
the average operating return on equity among the Company peer group, and
• the
fact
that
the
Company
operates
in
an
increasingly
competitive
and
challenging
market
cycle.
In
measuring
the
NEOs’
performance
against
the
target
operating
plan
ROE, the
Compensation
Committee
calculates
Adjusted Operating ROE. For purposes of this calculation, the Committee employs a formulaic adjustment to
actual GAAP Operating ROE to more accurately reflect a normalized catastrophe risk management measure over
time and evaluate the executive team’s risk mitigation strategies. The formula adjusts actual Operating ROE by
limiting catastrophe activity to 40% of anticipated catastrophe losses in the annual operating plan and 60% of actual
The Company’s Compensation Philosophy and Objectives
66
2023 Proxy Statement
catastrophe losses for the current fiscal year. Our annual operating plan assumes a “normalized” level of natural
catastrophe losses as derived from a 10,000-year simulation of potential modeled events, updated to quantify the
growing impact of human contribution to climate risk and the increased exposure factors associated with expected
increased loss severity and frequency from extreme climate events. Such a “normalized” catastrophe loss level
translates to a net after-tax Operating ROE that can range widely from low single digit to mid-teens return for a given
year based on competitive market factors such as interest rate changes, business mix, market capacity and the impact
of
alternative capital. Utilizing an adjusted catastrophe loss load in any one year will reflect, over the long term, the
performance of the portfolio relative to expected and does not overly benefit compensation during benign years
of catastrophe activity nor unduly penalize during extreme years. This method contemplates the fact that due to the
nature
of
catastrophe
events
any
one
year
has
inherent
volatility
and
that
the
catastrophe
load
used
in
setting
targets
is
an average annualized amount expected over the long term. Consequently, over time the long-term performance of
the portfolio relative to expected will be reflected in the calculation of incentive compensation.
Mr. Andrade’s Annual Cash Incentive Goals and Compensation
Mr. Andrade served as the Company’s President and CEO in 2022, with a base salary of $1.25 million. For the 2022
fiscal year, the Compensation Committee established the following separate financial and individual performance-
based criteria for purposes of establishing the bonus award amount for Mr. Andrade under the Executive Incentive
Plan.
Financial Performance Goal
Performance Level
Financial Performance Measure
(ROE)
Potential Maximum Bonus
Maximum
>=17.4%
$3.5
million
Target
12.4%
220% of Base Salary
Threshold
5.4%
50% of Base Salary
Below Threshold
<5.4%
Zero
As described above under the section entitled “Executive Performance Annual Incentive Plan”, the Compensation
Committee considers 60% of Mr. Andrade’s potential maximum bonus to be independently determined based
on the above tiered Company Operating ROE results. After comparing the Company’s 2022 fiscal year results to
the performance measures established for Mr. Andrade, the Compensation Committee concluded that based on
the Adjusted Operating ROE of 11.9%, Mr. Andrade’s maximum potential cash bonus as compared to target, was
$1,558,929.
Performance Measure
2022
Plan Operating
ROE
(Target)
2022
Adjusted
Operating ROE
Percentage of
Base Salary
Maximum Bonus
Resulting
Maximum Bonus
Potential
Operating ROE
12.4%
11.9%
60%
$1,558,929
The Compensation Committee separately considered the 40% portion of the maximum bonus eligible to be earned
based upon successful achievement of individual goals.
Individual Performance Measure
Maximum Bonus Potential
40% of 280% Base Salary Bonus Maximum
$1,400,000
Mr. Andrade’s total resulting maximum potential cash bonus in consideration of both the financial and individual
performance measures was as follows.
Performance Measure
2022 Plan Operating ROE
(Target)
2022 Adjusted
Operating ROE
Resulting Maximum
Bonus Potential
Operating ROE
12.4%
11.9%
$1,558,929
Individual
$1,400,000
Total
Potential
Cash
Bonus
$2,958,929
The Company’s Compensation Philosophy and Objectives
2023 Proxy Statement
67
In determining the final bonus and equity award, the Compensation Committee took note of the Company’s strong
risk management and portfolio optimization strategy under Mr. Andrade’s guidance in conjunction with his execution
responsibilities as CEO. The Committee gave particular consideration to Mr. Andrade’s initiatives to enhance
operational efficiency and technology transformation throughout the Company.
In awarding Mr. Andrade a cash bonus of $2,900,000, restricted share awards valued at $2,375,000 and PSU award
target valued at $2,375,000, the Compensation Committee recognized Mr. Andrade’s exceptional leadership in
overseeing execution of the Company’s long-term core strategic strategy, managing the Company’s potential
maximum loss exposure and protecting our capital base by employing intelligent capital protection measures against
unplanned and outsized natural perils, while deploying a strategic vision emphasizing diversification of our business
portfolio. The Committee further noted Mr. Andrade’s leadership in maintaining an industry leading expense ratio
while continuing to invest and help expand the Company’s global insurance operations, including establishing new
markets
in
2022
such
as
Singapore
and
Chile. Such
strategies
contributed
to
the
Company’s
positive
financial
results
a year dominated by significant industry catastrophe activity.
Other Named Executive Officers’ Annual Cash Incentive Goals and Compensation
For the 2022 fiscal year, the Compensation Committee established the following separate financial and individual
performance-based criteria under the Executive Incentive Plan for purposes of establishing the incentive cash bonus
award amount for Messrs. Karmilowicz, Kociancic, Mukherjee and Williamson.
Performance
Level
Financial
Performance
Measure
(Plan
Operating
ROE)
Potential Maximum Bonus for each NEO
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
Maximum
>=17.4%
200%
Base
Salary
200%
Base
Salary
200%
Base
Salary
200%
Base
Salary
$1,550,000
$1,750,000
$1,300,000
$1,600,000
Target
12.4%
130%
Base
Salary
130%
Base
Salary
130%
Base
Salary
130%
Base
Salary
$1,007,500
$1,137,500
$
845,000
$1,040,000
Threshold
5.4%
25%
Base
Salary
25%
Base
Salary
25%
Base
Salary
25%
Base
Salary
$ 193,750
$
218,750
$ 162,500
$
200,000
Below
Threshold
<5.4%
Zero
$ 0
Zero
$ 0
Zero
$ 0
Zero
$ 0
The Compensation Committee considers 60% of each NEO’s potential maximum bonus to be independently
determined
based
on
the
above
tiered
Company
ROE
results. After
comparing
the
Company’s
2022
fiscal
year
results
to
the performance measures established, the Compensation Committee concluded that based on the Adjusted
Operating ROE of 11.9%, each NEO’s maximum potential cash bonus in consideration of the financial performance
goal was as shown in the table below:
Mike Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
Financial
Performance
Measure (ROE)
2022
Plan Operating
ROE
(Target)
2022
Adjusted
Operating
ROE
Resulting
Maximum Bonus
Potential
Resulting
Maximum
Bonus
Potential
Resulting
Maximum
Bonus
Potential
Resulting
Maximum
Bonus
Potential
60.0%
12.4%
11.9%
$569,625
$643,125
$477,750
$588,000
The Company’s Compensation Philosophy and Objectives
68
2023 Proxy Statement
The Compensation Committee separately considered the 40% portion of the maximum bonus:
Individual Performance Measure
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
40% of 200% Base Salary Bonus Maximum
$620,000
$700,000
$520,000
$640,000
The
NEOs
total
resulting
maximum
cash
bonus
was
as
follows:
Mike
Karmilowicz
Mark
Kociancic
Sanjoy
Mukherjee
Jim
Williamson
Performance
Measure
2022
Plan Operating
ROE
(Target)
2022
Adjusted
Operating
ROE
Resulting
Maximum
Bonus
Potential
Resulting
Maximum
Bonus
Potential
Resulting
Maximum
Bonus
Potential
Resulting
Maximum
Bonus
Potential
Operating ROE
12.4%
11.9%
$
569,625
$
643,125
$477,750
$
588,000
Individual
$
620,000
$
700,000
$520,000
$
640,000
Total
Maximum
Bonus
$1,189,625
$1,343,125
$997,750
$1,228,000
Mr. Karmilowicz’s
Compensation
A key member of the Everest Insurance executive team since joining the Company in 2015, Mr. Karmilowicz served as
the
Company’s Executive Vice President and President and CEO of the Insurance Division in 2022, with a base salary
of
$775,000. In awarding Mr. Karmilowicz a cash bonus of $1,070,750, restricted share awards valued at $875,400 and
2022 PSU award target valued at $399.000, the Compensation Committee recognized Mr. Karmilowicz’s leadership
in managing several U.S. and global lines of business and overall responsibility for the successful management of
Everest’s global Insurance Division results in 2022.
Mr.
Kociancic’s
Compensation
A key member of the Company’s executive team, Mr. Kociancic served as the Company’s Executive Vice President and
Group Chief Financial Officer with a base salary of $875,000. In awarding Mr. Kociancic a cash bonus of $1,273,900,
restricted share awards valued at $1,180,500 and 2022 PSU award target valued at $509,500, the Compensation
Committee recognized Mr. Kociancic’s leadership in managing the financial functions of the Company including
financial reporting, investments, accounting, budgeting and tax planning and expense management.
Mr. Mukherjee’s Compensation
A key member of the Company’s executive team since joining the Company in 2000, Mr. Mukherjee served as the
Company’s Executive Vice President, General Counsel, Chief Compliance Officer and Corporate Secretary in 2022,
with a base salary of
$650,000. In awarding Mr. Mukherjee a cash bonus of
$900,000, restricted share awards valued at
$585,000 and 2022 PSU award target valued at $390,000, the Compensation Committee recognized Mr. Mukherjee’s
leadership in overseeing the Company’s global legal operations and compliance responsibilities including overseeing
Company’s ESG initiatives, managing all external litigations against the Company as well as providing guidance and
obtaining regulatory approvals on structuring the Company’s global expansion strategy.
Mr. Williamson’s Compensation
A key member of the Company’s executive team, Mr. Williamson served as the Company’s Group Chief Operating
Officer and Head of Reinsurance with a base salary of $800,000. In awarding Mr. Williamson a cash bonus of $1,167,000,
restricted share awards valued at $940,400 and 2022 PSU award target valued at $419,600, the Compensation
Committee recognized Mr. Williamson’s leadership in serving as Group Chief Operating Officer and simultaneously
as
Head
of
the
Everest
Reinsurance
Division, while
profitably
growing
a
balanced
and
diversified
reinsurance
portfolio.
Other Forms of Compensation
Apart from the salary, bonus and long-term compensation components discussed above, all employees including
executive officers receive other forms of compensation from the Company. That compensation includes Company-
paid term life insurance, partially subsidized medical and dental plan, Company-paid disability insurance and
participation in a Company-sponsored 401(k) employee savings plan. Certain executives also participate in a
Supplemental Savings Plan.
The Company’s Compensation Philosophy and Objectives
2023 Proxy Statement
69
Clawback Policy
The Company has a clawback policy covering current and former employees, including Named Executive Officers.
The policy provides for forfeiture and repayment of any incentive-based compensation (including vested and
unvested equity awards) granted or paid to an individual during the period in which he or she engaged in material
willful misconduct, including but not limited to fraudulent misconduct. The policy also requires the repayment and
termination of payments and benefits provided to such individual pursuant to any severance or similar agreement.
The Company is in the process of reviewing and updating the Clawback Policy to satisfy the requirements of Rule
10D-1 adopted by the SEC on October 26, 2022 consistent with Section 10D added to the Exchange Act as part of the
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. New Rule 10D-1 directs the national securities
exchanges to establish listing standards that prohibit the listing of any security of a company that does not adopt and
implement a written policy requiring the recovery, or “clawback,” of certain incentive-based executive compensation.
The Company will adopt such new compliant clawback policy no later sixty days following the date that the NYSE
publishes final listing standards as required by Rule 10D-1, which is expected to be later this year.
Perquisites and Other Benefits
When deemed appropriate, the Company provides Named Executive Officers with perquisites and other personal
benefits that are reasonable and consistent with the overall compensation plan and the philosophy of attracting and
retaining key employees. The Compensation Committee periodically reviews these awards of perquisites and other
benefits.
Tax and Accounting Implications
Section 162(m) of the Code limits the deductibility of annual compensation in excess of $1 million paid to “covered
employees” of the Company with some limited exceptions for compensation paid pursuant to certain arrangements
in place on November 2, 2017. For 2018 and after, our covered employees will generally include anyone who (i) is
the CEO or chief financial officer at any time during the year, (ii) was one of the other Named Executive Officers who
was an executive officer as of the last day of the fiscal year and (iii) was a covered employee for any previous year
after 2016.
As with prior years, although the Compensation Committee will consider deductibility under Section 162(m) with
respect to the compensation arrangements for executive officers, deductibility will not be the sole factor used in
determining appropriate levels or methods of compensation. The Compensation Committee considers many factors
when designing its compensation arrangements in addition to the deductibility of the compensation and maintains
the flexibility to grant awards or pay compensation amounts that are non-deductible if they believe it is in the best
interest of our Company and our shareholders.
It is the Compensation Committee’s objective to have its U.S. tax-paying executives not be subject to penalties under
Code Section 409A (“§409A”). Accordingly, all applicable compensation and benefit programs have been amended
and are administered in accordance with §409A.
The foregoing provides a general overview of the Company’s philosophy on executive compensation. The tables
contained in the subsequent sections attribute specific dollar values to the various aspects of executive compensation
previously discussed.
Compensation of Executive Officers
70
2023 Proxy Statement
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth compensation paid or accrued to the Company’s Named Executive Officers who served
during fiscal year 2022 (collectively, the “Named Executive Officers or NEOs”). The principal position listed under the
name of each officer is as of December 31, 2022. Further, as noted above, Sanjoy Mukherjee will be departing the
Company effective April 21, 2023.
2022 SUMMARY COMPENSATION TABLE
Stock
Awards
Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
(3)
Name and
Principal
Position
Year
Salary
Bonus
Restricted
Stock
Awards
(1)
Performance
Share Unit
Awards
(2)
Non-Equity
Incentive Plan
Compensation
All Other
Compensation
Total
Juan C. Andrade
CEO and President
2022
$
1,250,000
$
—
2,125,822
2,125,822
$
2,900,000
$
—
$
704,555
$
9,106,199
2021
1,250,000
—
2,000,902
$
2,000,902
3,000,000
—
614,322
8,866,126
2020
1,298,077
—
1,876,272
1,876,272
2,500,000
—
512,591
8,063,212
Mike Karmilowicz
Executive Vice President and CEO of Everest Insurance®
2022
$
749,154
$
—
$
809,621
$
404,057
$
1,070,750
$
—
$
234,808
$
3,268,390
2021
660,000
667,371
328,235
1,060,800
163,874
2,880,280
Mark Kociancic
Executive Vice President and Chief Financial Officer
2022
$
875,000
$
—
1,059,896
$
529,194
$
1,273,900
$
—
$
376,631
$
4,114,621
2021
875,000
—
993,184
495,381
1,401,400
—
285,175
4,050,140
2020
201,923
—
$
5,000,048
—
500,000
—
89,743
5,791,714
Sanjoy
Executive Vice President, General Counsel and Secretary
2022
$
650,000
$
—
$
615,131
$
410,088
$
900,000
$
(600,167)
$
213,188
$
2,188,240
2021
641,231
—
585,010
390,006
975,000
81,008
146,004
2,818,259
2020
632,307
—
478,075
318,717
700,000
724,858
138,885
2,992,842
Jim Williamson
Executive Vice President, Chief Operating Officer and Head of Reinsurance
2022
$
801,923
$
—
$
851,836
$
425,164
$
1,167,000
$
—
$
284,018
$
3,529,941
2021
702,167
703,707
347,614
1,210,000
—
216,735
3,180,223
(1) The amounts are the aggregate grant date fair value for restricted awards granted during 2022 computed in accordance with FASB ASC Topic 718.
Restricted shares vest at the rate of 20% per year over five years.
(2)
The amounts are the aggregate grant date fair value for performance share unit awards granted during 2022 computed in accordance with FASB
ASC Topic 718, at the target achievement percentage (100%). The performance achievement factor can range between 0% and 175% of the target
grant. If the participants achieved the maximum performance achievement factor, the value of the performance share unit grants would be as follows:
Mr. Andrade $3,720,188; Mr. Karmilowicz $707,100; Mr. Kociancic $926,089; Mr. Mukherjee $717,653 and Mr. Williamson $744,038.
(3) Represents the aggregate change in the present value of the officers’ accumulated benefit under the qualified and supplemental pension plans from
December 31, 2021 to December 31, 2022. Earnings on the Supplemental Savings Plan are not included as they are invested in the same investment
offerings as the qualified savings plan and are not preferential.
Compensation of Executive Officers
2023 Proxy Statement
71
For the Named Executive Officers, the 2022 amount in the All Other Compensation column include:
Andrade
Karmilowicz
Kociancic
Mukherjee
Williamson
Life
premiums
$
1,345
$
1,345
$
1,335
$
1,345
$
1,345
Employer Matching
Contributions
(Qualified and
Non-qualified)
37,501
22,475
26,251
19,501
23,308
Dividends on Restricted
Shares
252,197
44,681
146,438
50,528
60,059
Employer Discretionary
Contribution
(4)
340,000
126,697
159,349
105,600
119,216
Umbrella insurance
premiums
611
611
611
611
611
Car Allowance
12,000
—
12,000
—
12,000
Stipend
(5)
—
—
—
—
35,500
Executive
11,000
11,000
0
11,000
11,000
Executive
49,901
27,999
30,647
24,603
20,979
Total:
704,555
234,808
376,631
213,188
284,018
(4) Messrs. Andrade, Kociancic, Williamson and Karmilowicz are not participating in the Retirement Plan or Supplemental Retirement
Plan and instead receive an additional qualified plan contribution pursuant to the revision of the Company’s Savings Plan that is
applicable to those employees hired after April 1, 2010.
(5) The amount reported for Mr. Williamson includes portions of the $100,000 cash stipend paid for taking on additional responsibilities
as Head of Reinsurance in May 2021. Mr. Williamson received stipend payments totaling $64,500 in 2021 and the remainder of the
stipend payments ($35,500) in early 2022.
Grants of Plan-Based Awards
The following table sets forth certain information concerning equity and cash awards granted under the Company’s
Stock Incentive Plan and the Executive Performance Annual Incentive Plan during 2022 to the Named Executive
Officers.
2022 GRANTS OF PLAN-BASED AWARDS
Estimated Future
Payouts Under
Non-Equity Incentive Plan
Awards
(1)
Estimated Future
Payouts Under
Equity Incentive Plan Awards
Restricted
Stock
Awards
Number
of Shares
(2)
Grant Date Fair Value
of Stock Awards
Name
Grant Date
Threshold
Target
Maximum
Threshold
Target
(4)
Maximum
(3)
Restricted
Stock
Awards
(3)
PSU
Awards
(6)
Juan C.
Andrade
2/23/2022
—
2,750,000
3,500,000
—
7,050
12,338
7,050
2,125,822
2,125,822
Mike
Karmilowicz
2/23/2022
—
1,007,500
1,550,000
—
1,340
2,345
2,685
809,621
404,057
Mark
Kociancic
2/23/2022
—
1,137,500
1,750,000
—
1,755
3,071
3,515
1,059,896
529,194
Sanjoy
Mukherjee
2/23/2022
—
845,000
1,300,000
—
1,360
2,380
2,040
615,131
410,088
Jim
Williamson
2/23/2022
—
1,040,000
1,600,000
—
1,410
2,468
2,825
851,836
425,164
(1) Potential awards to be made pursuant to the Executive Performance Annual Incentive Plan. The actual award is shown in the “Non-
Equity Incentive Compensation Plan” column of the Summary Compensation Plan table.
(2) This column shows the number of restricted shares granted in 2022 to the Named Executive Officers pursuant to the 2020 Stock
Incentive Plan for grants made on February 23, 2022. Restricted shares vest at the rate of 20% per year over five years. During the
restricted period, quarterly dividends are paid to the Named Executive Officer.
Compensation of Executive Officers
72
2023 Proxy Statement
(3) The
grant
date
fair
value
of
each
equity
award
calculated
in
accordance
with
FASB
ASC
Topic
718.
(4) This column shows the number of performance share units outstanding on December 31, 2022 for each Named Executive Officers
pursuant to the 2020 Stock Incentive Plan, assuming achievement at the target level (100%). Performance share units vest 100%
after
three years.
(5) This column shows the number of performance share units outstanding on December 31, 2022 for each Named Executive Officers
pursuant to the 2020 Stock Incentive Plan, assuming achievement at the maximum level (175%). Performance share units vest
100% after three years.
(6) The
grant
date
fair
value
of
each
equity
award
calculated
in
accordance
with
FASB
ASC
Topic
718.
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END 2022
Stock Awards
(1)
Restricted Stock Awards
PSU
Name
Number of Shares
or
Units of Stock That
Have
Not
Vested
(1)
Market Value of
Shares or Units of
Stock That Have
Not Vested
(2)
Equity Incentive
Plan Awards:
Number of Unearned
Shares, Units or
Other Rights
That
Have
Not Vested
(1)
Equity Incentive
Plan Awards:
Market or
Payout Value
of
Unearned
Shares,
Units or
Other Rights
That Have
Not Vested
(2)
Juan C. Andrade
33,072
$10,955,761
16,482
$5,459,827
Mike Karmilowicz
6,874
$ 2,277,150
2,945
$
975,673
Mark Kociancic
19,395
$ 6,424,982
4,095
$1,356,551
Sanjoy Mukherjee
7,325
$ 2,426,553
3,194
$1,057,994
Jim Williamson
8,425
$ 2,790,950
3,108
$1,029,587
(1) Restricted shares vest at the rate of 20% annually over a five-year period. Grant dates for the restricted shares are as shown in the
table that follows:
(2) Determined by multiplying the NYSE December 31, 2022 closing price of $331.27 by the number of outstanding restricted share
awards or by the number of both unvalued and unvested performance share unit awards.
Compensation of Executive Officers
2023 Proxy Statement
73
Grant
2/21/2018
2/27/2019
9/18/2019
11/19/2019
2/26/2020
11/18/2020
2/23/2021
2/23/2022
Juan C. Andrade
Restricted
Awards
—
—
15,352
—
4,062
—
6,608
7,050
PSU Awards
—
—
—
—
6,770
—
8,260
7,050
Mike Karmilowicz
Restricted
Awards
331
718
—
—
936
—
2,204
2,685
PSU Awards
—
—
—
—
780
—
1,355
1,340
Mark Kociancic
Restricted
Awards
—
—
—
—
—
12,600
3,280
3,515
PSU Awards
—
—
—
—
—
—
2,045
1,755
Sanjoy Mukherjee
Restricted
Awards
342
774
—
1,202
1,035
—
1,932
2,040
PSU Awards
—
—
—
—
1,150
—
1,610
1,360
Jim Williamson
Restricted
Awards
—
—
—
—
—
3,276
2,324
2,825
PSU Awards
—
—
—
—
—
—
1,435
1,410
Share Option Exercises and Shares Vested
The following table sets forth certain information concerning the number and value of vested shares at the end of
2022
held
by
the
Named
Executive
Officers. The
Named
Executive
Officers
do
not
hold
any
outstanding
stock
options.
SHARES VESTED
Share Awards
(PSU
Grants)
Share Awards (Restricted Stock)
Name
Number of Shares
Acquired on
Settlement
Value Realized
Settlement
(1)
Number of Shares
Acquired on
Vesting
Value Realized
on
Vesting
(2)
Juan C. Andrade
—
—
10,682
$3,068,732
Mike Karmilowicz
—
—
1,853
$
555,748
Mark Kociancic
—
—
5,020
$1,599,911
Sanjoy Mukherjee
1,269
$348,172
2,509
$
766,009
Jim Williamson
—
—
1,673
$
526,881
(1) Amount
reflects
the
aggregate
market
share
value
on
the
day
of
settlement
of
the
performance
share
unit
award.
(2) Amount
reflects
the
aggregate
market
share
value
on
the
day
that
the
restricted
shares
vest.
Retirement Plan
Mr. Mukherjee participated in the Everest Reinsurance Company Retirement Plan (the “Retirement Plan”) and in
the Supplemental Retirement Plan (the “Supplemental Plan”), both of which are defined benefit pension plans. The
Retirement Plan and Supplemental Plan were both closed to new employees as of April 1, 2010. Additionally, effective
January 1, 2018, accrued benefits under the Supplemental Retirement Plan were frozen for the participating NEOs in
that plan as of December 31, 2017.
A participant’s “final average earnings” under the Retirement Plan will be his or her average annual “earnings” under
the plan during the 72 consecutive months of continuous service in which the participant received the greatest
amount of earnings out of the final 120 months of continuous service. For this purpose, “earnings” generally include
the
participant’s
base
salary,
cash
bonus
payments
under
the
Executive
Incentive
Plan
and,
for
participants
who
held
Compensation of Executive Officers
74
2023 Proxy Statement
positions equivalent to or senior to that of department vice president when that position existed, cash payments
under the Company’s Annual Incentive Plan. “Earnings” does not include any other compensation set forth in the
Summary Compensation Table.
Final average earnings will be determined under the Supplemental Plan in the same manner as under the Retirement
Plan, except that a participant’s earnings are not subject to the limitations under the Internal Revenue Code.
“Continuous service” under the Retirement Plan and Supplemental Plan will be the number of years and months
worked for Everest Re and certain affiliates, including during the period of affiliation with Prudential.
The table below shows the present value of accumulated benefits payable to each of the Named Executive Officers
determined using interest rate and mortality rate assumptions consistent with those in the Company’s financial
statements and the number of years of service credited to each. A participant becomes vested in the Supplemental
Plan upon reaching five years of service, retirement at age 65 or upon a Change of Control. If a participant leaves
the
Company prior to becoming vested in the Supplemental Plan, he receives no benefits.
2022 PENSION BENEFITS TABLE
Name
Plan Name
Number of
Years Credited
Service
Present value
of Accumulated
Benefit
Payments
During
Last Fiscal
Year
Juan C. Andrade
Retirement
N/A
—
—
Supplemental Plan
—
—
Mike Karmilowicz
Retirement
N/A
—
—
Supplemental Plan
—
—
Mark Kociancic
Retirement
N/A
—
—
Supplemental Plan
—
—
Sanjoy Mukherjee
Retirement
22.5
1,065,291
—
Supplemental Plan
2,955,364
—
Jim Williamson
Retirement
N/A
—
—
Supplemental Plan
—
—
(1)
The table employs the discount rate of 5.25% on December 31, 2022 and 2.86% on December 31, 2021 for the Retirement Plan
and pre-retirement Supplemental Plan. Post retirement, the Supplemental Plan discount rate is 5% for both years.
The Mortality Table used for 12/31/2022 is the Pri-2012 White Collar Table with Scale MP-2021 for the Retirement Plan projected to
executive’s
assumed
retirement
age. Updated Table
417(e)
Mortality
is
used
for
the
Supplemental
Plan
post-retirement
projected
executive’s assumed retirement age.
For 12/31/2021, the Mortality Table used is the Pri-2012 White Collar Table with Scale MP-2021 for the Retirement Plan projected to
executive’s
assumed
retirement
age. Updated Table
417(e)
Mortality
is
used
for
the
Supplemental
Plan
post-retirement
projected
executive’s assumed retirement age.
The payment form assumes 50% Joint and Survivor for the Retirement Plan (wives assumed to be 4 years younger than their
husbands) unless final benefit election has already been made and single life annuity for the Supplemental Plan at earliest
unreduced retirement age.
The Assumptions for the 2022 calculations related to Retirement Plan and the pre -retirement Supplemental Plans are the same as
those used in the FAS ASC 715 disclosure report for year ending December 31, 2022.
The information above has been developed assuming that the participants will retire at the earliest age at which they would receive
an unreduced benefit. Mr. Mukherjee is eligible to receive an unreduced benefit under the Retirement Plan at age 63 and 10
months and at age 60 under the Supplemental Retirement Plan.
Employees hired after April 2010 do not accrue benefits in the Defined Benefit Plan. As of December 31, 2017, accruals in the
Supplemental Retirement Plan were frozen. Participants receive a non-elective contribution in the Supplemental Savings Plan.
Compensation of Executive Officers
2023 Proxy Statement
75
2022 NON-QUALIFIED DEFERRED COMPENSATION TABLE
The 2022 Non-qualified Deferred Compensation Table shows information about the Supplemental Savings Plan
(1)
and Deferred Bonus and Salary Contribution Plan
Name
Executive
Contributions in
Last
Fiscal
Year
(2)
Registrant
Contributions in
Last
Fiscal
Year
(2)
Aggregate
Earnings in
Last
Fiscal
Year
Aggregate
Withdrawal/
Distributions
Aggregate
Balance at Last
Fiscal
Year-End
(3)
Juan
C. Andrade
Everest Re Supplemental
Savings Plan
28,350
343,950
14,054
—
967,477
Non-qualified deferred
bonus and salary
contribution plan
Mike Karmilowicz
Everest Re Supplemental
Savings Plan
13,325
118,672
(29,704
)
—
299,365
Non-qualified deferred
bonus and salary
contribution plan
Mark Kociancic
Everest Re Supplemental
Savings Plan
17,100
155,098
(30,009
)
—
266,661
Non-qualified deferred
bonus and salary
contribution plan
227,640
27,661
255,301
Sanjoy
Mukherjee
Everest Re Supplemental
Savings Plan
10,350
115,950
(165,345
)
—
673,960
Non-qualified deferred
bonus and salary
contribution plan
113,750
(5,047
)
108,704
Jim Williamson
Everest Re Supplemental
Savings Plan
14,158
115,073
(20,581
)
—
192,197
Non-qualified deferred
bonus and salary
contribution plan
288,616
78,392
367,007
(1)
The Supplemental Savings Plan has the same investment elections as the Company’s 401(k) plan and is designed to allow each
participant to contribute a percentage of
his base salary and receive a company match beyond the contribution limits prescribed
by
the Code with regard to 401(k) plans. When the annual IRS 401(a) (17) compensation maximum is reached under the qualified
savings
plan, eligible employees may contribute to the Supplemental Savings Plan which allows for up to a 3% employee
contribution and a 3% company match plus an additional discretionary contribution by the Company. Withdrawal is permitted
only upon cessation of employment.
(2) All
of
the
amounts
reported
in
this
column
are
included
in
the
2022
Summary
Compensation
Table
as
applicable.
(3) The
amounts
reported
in
this
column
represent
the
aggregate
balances
from
the
Everest
Re
Supplemental
Savings
Plan.
Pay Versus Performance Disclosure
76
2023 Proxy Statement
PAY
VERSUS PERFORMANCE DISCLOSURE
As required by Section 953(a) of the Dodd-Frank Wall
Street
Reform and Consumer Protection Act and Item 402(v)
of Regulation S-K, we are providing the following information regarding the relationship between compensation
actually paid to our Named Executive Officers and the Company’s financial performance.
Pay Versus Performance Table
The table below reflects information on compensation both as reported in the Summary Compensation Table (“SCT
Total Pay”) and as “compensation actually paid” (or “CAP”) for the applicable fiscal year for our principal executive
officer (“PEO”) and for all of our other named executive officers (“Non-PEO NEOs”) (as an average for such year for
the Non-PEO NEOs), accompanied by total shareholder return (TSR) and Net Income metrics, as well as Adjusted
Operating ROE (the Company-selected measure). Adjusted Operating ROE was selected as the most relevant and
important measure in the relationship of compensation actually paid to NEOs relative to 2022 Company performance.
Adjusted Operating ROE is a relevant measure in our short-term and long-term incentive plans for our Named
Executive Officers.
Average
Summary
Compensation
Table
Total for
Non-PEO
NEOs ($)
22
Average
Compensation
Actually
Paid to
Non-PEO
NEOs ($)
Value for Initial Fixed $100
Investmetn13 Based on:
Year
Summary
Compensation
Table
Total for
PEO($)
11
Compensation
Actually
Paid to
PEO ($)
12
Total
Shareholder
Return ($)
15
Peer Group
Total
Shareholder
Return($)
16
Net
Income ($)
Adjusted
Operating
ROE (%)
14
2022
2021
2020
The following table details the adjustment to the SCT Total Pay for our PEO to determine the CAP as computed in
accordance with Item 402(v). Amounts do not reflect actual compensation earned by or paid to our NEOs during the
applicable year. The PEO did not participate in any defined benefit pension plan.
11
served
as
the
Principal
Executive
Officer
(“PEO”)
of
Everest
for
all
applicable
years
in
this
table.
12
The non-PEO Named Executive Officers (“NEOs”) for 2020 include John Doucette, Craig Howie, Mark Kociancic, Sanjoy Mukherjee and Jonathan Zaffino; for
2021 include: John Doucette, Mike Karmilowicz, Mark Kociancic, Sanjoy Mukherjee and Jim Williamson; and for 2022 include: Mike Karmilowicz, Mark
Kociancic, Sanjoy Mukherjee and Jim Williamson.
13
Assumes
$100
invested
on
12/31/19
in
Everest
common
stock,
including
reinvestment
of
dividends.
14
plan and 60% of
actual catastrophe losses for the current fiscal year. For 2021 and 2022, the ratio for determining Adjusted Operating ROE was 50%
the operating plan and 50% actual catastrophe losses for the respective fiscal years.
15
For purposes of Everest’s Pay Versus Performance Disclosure section, cumulative Total Shareholder Return is defined as the change in the total dollar
security or entire portfolio of securities, over some period of time, assuming $100 dollars of initial investment. Total returns reflect
changes in stock price as well as
all distributions or dividends paid to shareholders. The procedure for calculating an index begins with calculating total
returns for each individual company in the index.
The total return of each company in the index is calculated by multiplying the closing price of a share
by the ending shares held, based on a $100 initial investment.
Any
dividends paid are reinvested by dividing the dividend per share by the stock price
Each company’s total return is then weighted for each period
based on its market capitalization at the beginning of the period, relative to the market capitalization of
the entire group.
The market capitalization is
in a weighted average total
return for each period. Total Shareholder Return in all other sections of
this proxy refers to Everest’s Investor Day definition, defined as
annual growth
16
The
S&P
Insurance
(Property
and
Casualty)
Index
is
used
as
Everest’s
peer
group
for
purposes
of
the
pay
versus
performance
disclosure
.
Pay Versus Performance Disclosure
2023 Proxy Statement
77
PEO SCT TOTAL PAY TO CAP RECONCILIATION
Fiscal Year
SCT Total
$8,063,212
$8,866,126
$9,106,199
– Grant Date Fair Value of Stock Awards Granted in Fiscal Year
$(3,752,544 )
$(4,001,805 )
$(4,251,644 )
+ Fair Value at Fiscal Year -End of Outstanding Unvested Stock Awards
Granted in Fiscal Year
$3,169,579
$4,525,158
$4,670,907
± Change in Fair Value of Outstanding Unvested Stock Awards Granted in
Prior Fiscal Years17
$(1,312,596 )
$1,402,574
$2,354,332
± Change in Fair Value as of Vesting Date of Stock Awards Granted in Prior
Fiscal Years for Which Applicable Vesting Conditions Were Satisfied During
Fiscal Year18
$(563,092 )
$147,447
$142,718
Compensation Actually Paid
$5,604,559
$10,939,500
$12,022,513
The following table details the adjustment to the SCT Total Pay as the average for our other NEOs to determine
“compensation actually paid” as computed in accordance with Item 402(v) for the other NEOs. Amounts do not reflect
actual compensation earned by or paid to our NEOs during the applicable year.
NEO AVERAGE SCT TOTAL PAY TO CAP RECONCILIATION
Fiscal Year
Average SCT Total
$3,209,042
$3,185,203
$3,275,300
– Grant Date Fair Value of Stock Awards Granted in Fiscal Year
$(1,799,573 )
$(1,164,932 )
$(1,276,247 )
+ Fair Value at Fiscal Year -End of Outstanding Unvested Stock
Awards Granted in Fiscal Year
$1,455,572
$1,317,281
$1,402,100
± Change in Fair Value of Outstanding Unvested Stock Awards
Granted in Prior Fiscal Years19
$(236,502 )
$362,214
$563,880
± Change in Fair Value as of Vesting Date of Stock Awards Granted
in Prior Fiscal Years for Which Applicable Vesting Conditions Were
Satisfied During Fiscal Year20
$(95,518 )
$49,873
$114,067
– Change in Actuarial Present Value of Accumulated Benefit
Under Defined Benefit Pension Plan
$(235,821 )
$(16,202 )
N/A
+ Service cost and prior service cost
$26,334
$30,048
$19,050
Average Compensation Actually Paid
$2,323,534
$3,763,486
$4,098,149
17
Difference
between
Fair
Value
from
End
of
Prior Year
to
End
of
Current Year
18
Difference
between
Fair Value
from
End
of
Prior Year
to Vesting
Date
19
Difference
between
Fair
Value
from
End
of
Prior Year
to
End
of
Current Year
20
Difference
between
Fair Value
from
End
of
Prior Year
to Vesting
Date
21
In
2021, the
change
in
actuarial
present
value
was
negative
$11,030
for
Mr. Doucette
and
$81,008
for
Mr. Mukherjee. Under
the
rule, the
change
in
value is deducted only if the value is positive. Thus, only Mr. Mukherjee’s value was incorporated into the calculation.
22
The change in actuarial present value for Mr. Mukherjee was negative $600,167 in 2022. Under the rule, the change in actuarial present value is deducted only if
the value is positive. Thus, this value was not incorporated into the calculation.
Pay Versus Performance Disclosure
78
2023 Proxy Statement
Relationship Between Compensation Actually Paid and Financial Performance Measures
The following graphs further demonstrate the relationship between the compensation actually paid and performance
measures that are included in the preceding pay versus performance tabular disclosure.
Comparison of 3 Year Cumulative TSR
Everest Re Group, Ltd. versus S&P Property & Casualty Insurance
Compensation Actually Paid (“CAP”) versus Cumulative Total Shareholder Return (“TSR”)
Pay Versus Performance Disclosure
2023 Proxy Statement
79
Compensation Actually Paid (“CAP”) versus Net Income
Compensation Actually Paid (“CAP”) versus Adjusted Operating ROE
Tabular Disclosure of the Most Important Measures Linking Compensation Actually Paid in 2022 to Company
Performance
Below is an unranked list of the Company’s most important financial performance measures used to link the PEO
and NEOs’ compensation actually paid to Company performance for 2022. For further information regarding
these financial performance measures and their function in our executive compensation program, please see the
Compensation Discussion and Analysis section above.
Pay Versus Performance Disclosure
80
2023 Proxy Statement
CEO PAY RATIO DISCLOSURE
Fiscal
2022
2022
Employee
Median
Employee
CEO
Annual Base Salary
$ 136,000
$ 1,250,000
Bonus Paid
March 2023
$ 12,000
$ 2,900,000
Res Share Value Granted
Feb. 2022
$ 0
$ 2,125,000
Perf Share Target Value Granted
Feb. 2022
$ 0
$ 2,125,000
Pension Value and Nonqualified Deferred Comp Earnings
PY 2022
$ 0
$ 0
All Other Compensation
PY 2022
$ 15,052
$ 704,555
Total
Comp
$ 163,052
$ 9,104,555
In 2022, the ratio of the total annual compensation of our CEO to the median compensation of our employees was
55.83 to one.
Methodology
•
Date selected to determine employee population for purposes of identifying the median employee– December 1,
2022.
•
Median employee identified using Total Compensation, which includes base salary, bonus and stock awards (if any), as
well as any other compensation.
• Employees
from
all
Everest
locations
included
in
calculation
to
identify
median.
• Salaries,
bonuses
and
stock
for
non-US
employees
converted
to
USD
(12/1/2022
conversion
rates).
• Salaries
for
part-time
employees
annualized
to
a
full-time
equivalent.
•
Annual salary, bonus and stock target amounts were included for mid-year hired employees who were not otherwise
eligible to participate in the full 2022 annual compensation review process.
•
“All Other Compensation” includes insurance premiums, allowances, employer matching contributions (qualified and
non-qualified), dividends on restricted shares and employer discretionary contributions.
23
Total Shareholder Return as defined at Everest’s Investor Day is defined as annual growth in Book Value Per Share (excluding Unrealized Gains and Losses
on Fixed Maturity investments) plus Dividends Per Share.
Employment, Change of Control and Other Agreements
2023 Proxy Statement
81
EMPLOYMENT, CHANGE OF CONTROL AND OTHER
AGREEMENTS
Employment agreements have been entered into with Messrs. Andrade, Kociancic, Karmilowicz, Williamson and
Mukherjee. Employment agreements are entered into when it is determined that an employment agreement assists in
obtaining assurance as to the executive’s continued employment in light of the prevailing market competition for the
particular position, or where the Compensation Committee believes that an employment agreement is appropriate to
attract an executive in light of market conditions and the prior experience of the executive. Employment agreements
with
key executive officers further provide the Company protection against the potential loss of business that could
result
from the departure of
a key executive by including non-disclosure, non-compete and non-solicitation covenants
in such
agreements. The terms of the agreement take into consideration the executive’s prior background, experience,
compensation, competitive conditions and negotiations with the executive. On February 23, 2022, the Compensation
Committee selected Messrs. Andrade, Karmilowicz, Kociancic, Mukherjee and Williamson to become participants in
the
Executive
Incentive
Plan.
Messrs. Andrade,
Karmilowicz,
Kociancic,
Mukherjee
and
Williamson
are
all
participants
in the Senior Executive Change of Control Plan (See “Change of Control Arrangements”).
Juan C. Andrade
. Effective August 1, 2019, the Company, Everest Global and Everest Holdings entered into an
employment agreement with Mr. Andrade to serve as President and CEO of those companies. On December 17,
2021, Everest announced the extension of Mr. Andrade’s employment agreement through the end of 2023 with
automatic annual extensions following this term. The agreement provides for an annual salary of $1.25 million, subject
to increases, if any, as determined and approved by the Compensation Committee and eligibility for an equity grant
with a target value of 360% of his salary. The employment agreement’s material terms for a termination on death,
disability
or
a
termination
without
cause
or
resignation
for
good
reason
are
outlined
in
the
sections
and
tables
below.
Mike Karmilowicz
. Mr. Karmilowicz entered into an employment agreement with Everest National Insurance
Company, a member of the Company effective August 3, 2020 continuing in effect up through and including August 3,
2023 to serve as Executive Vice President and CEO of the Company. Mr. Karmilowicz’s base salary is $650,000 per
year, subject to increases, if any, as determined and approved by the Compensation Committee of the Group’s Board
of Directors. During the term, he is eligible to participate in an annual incentive bonus program established by Group
with a target annual incentive bonus of 130% of his base salary.
Mark Kociancic
. Effective October 12, 2020, Everest Global entered into an employment agreement with Mr.
Kociancic
under which he currently serves as Executive Vice President and Chief Financial Officer of the Company. The
agreement, which terminates on October 12, 2023, provides for an annual salary of $875,000, subject to increases,
if any, as determined and approved by the Compensation Committee and eligibility for an equity grant with a target
value of 170% of his salary. The employment agreement’s material terms for a termination on death, disability or a
termination without cause or resignation for good reason are outlined in the sections and tables below.
Sanjoy Mukherjee
. On January 1, 2017, Everest Global entered into an employment agreement with Mr. Mukherjee
under which he is to serve as the General Counsel, Chief Compliance Officer and Secretary. The agreement was
automatically renewed following the agreement’s initial expiration date of January 1, 2020 (and shall continue in force
unless terminated in accordance with the terms of
the agreement or as otherwise agreed by the parties) and provided
for
an annual salary of $500,000, subject to increases, if any, as determined and approved by the Compensation
Committee. The employment agreement provides for Mr. Mukherjee’s continued eligibility to receive PSU not
previously forfeited subject to his signing a general release and waiver in the event of his retirement at age 65,
death or disability prior to the last day of the restricted period. In the event of his termination without cause or for
good
reason, the
PSU
will
continue
to
settle
pursuant
to
their
terms. The
employment
agreement’s
material
terms
for
a termination on death, disability or a termination without cause or resignation for good reason are outlined in the
sections and tables below.
On March 14, 2023, Everest announced that Sanjoy Mukherjee will be leaving the Company effective April 21, 2023.
Subject to the terms of the transition agreement entered into by Mr. Mukherjee and the Company dated March 10,
2023 (the “Transition Agreement”), he will serve as an advisor to the Company from April 22, 2023 through July 3,
2023 (the “Separation Date”) and, for such services, he will receive a one-time payment of $50,000. Subject to the
terms of Mr. Mukherjee’s employment agreement and the Transition Agreement, Mr. Mukherjee will receive accrued
payments, vesting of equity awards, insurance benefits and a separation allowance in accordance with the terms of his
employment agreement, a one-time payment of two years of his base annual salary payable in January 2025 and a
cash payment in lieu of a tranche of six hundred and one (601) restricted shares that would otherwise have vested
on
November 19, 2024 (based on the market price of the Company’s stock at the close of the New York Stock Exchange
on the Separation Date).
Employment, Change of Control and Other Agreements
82
2023 Proxy Statement
Jim Williamson
. Mr. Williamson entered into an employment agreement with Everest Global to serve as Executive Vice
President and Chief Operating Officer effective October 1, 2020 and to continue in effect up through and including
October 1, 2023. During the term, Mr. Williamson’s base salary is $700,000 per annum, subject to increases, if any,
as determined and approved by the Compensation Committee of Group’s Board of Directors with a target annual
incentive bonus of 130% of base salary. Effective May 10, 2021, Mr. Williamson assumed the additional responsibilities
as
the Head of the Everest Reinsurance Division.
Change of Control Arrangements
. The Company’s change of control arrangements, embodied within the Senior
Executive Change of Control Plan, are principally intended to provide continuity of management by motivating
executive officers to remain with the Company, despite the uncertainty that arises in the context of a change in
control. The Senior Executive Change of Control Plan is designed to be compliant with §409A. A violation of §409A
may subject an executive to recognition of income with respect to nonqualified deferred compensation at the time
such compensation becomes vested plus a 20 percent tax and interest. Accordingly, in order to comply with the
requirements of §409A, the Senior Executive Change of Control Plan requires the participant to wait six months
following a termination of employment due to a change of control in order to receive any payments under the plan.
The Change of
Control Plan is administered by the Compensation Committee, which selects participants from among
the
senior executives of the Company and its subsidiaries. Among others, the Compensation Committee has selected
Mr.
Andrade, Mr. Karmilowicz, Mr. Kociancic, Mr. Williamson and Mr. Mukherjee to participate in the plan.
The Senior Executive Change of Control Plan provides that if, within two years after the occurrence of a material
change (as defined in the plan) a participant terminates his or her employment for good reason (as defined in the
plan) or the Company terminates the participant’s employment for any reason other than for due cause (as defined
in the plan), then (a) all of the participant’s outstanding share options granted under the Company’s stock plans shall
immediately vest and remain exercisable for three months following termination of employment; (b) all restrictions on
the participant’s restricted shares awarded under the Company’s share plans shall immediately terminate and lapse,
(this does not include PSU which are not subject to the Senior Executive Change of Control Plan); (c) the participant
shall receive a cash payment six months after termination equal to the participant’s average salary and annual
incentive bonus for the three most recent taxable years (or such shorter period as may be applicable) multiplied by
a number between 2.00 and 2.99 as determined by the Compensation Committee (for Mr. Andrade, the number
is 2.5; for Messrs. Karmilowicz, Kociancic, Williamson and Mukherjee the number is 2.00); (d) the participant shall
continue to be covered under the Company’s medical and dental insurance plans for a period of two years from the
date of termination; and (e) the participant shall receive “special retirement benefits” in an amount that will equal
the retirement benefits he or she would have received under the Everest Reinsurance Retirement Plan and/or the
Everest Reinsurance Employee Saving Plan and any supplemental, substitute or successor plans adopted by the
Company had he or she continued in the employ of the Company for a two year period following termination. Special
Retirement benefits shall be paid six months after termination.
The Senior Executive Change of Control Plan includes a “Best Net” provision regarding the determination and
treatment of parachute payments. Under the “Best Net” provision, in lieu of an automatic reduction in benefits
in the event of an excess parachute payment that triggers the excise tax, benefits are reduced to avoid an
excess parachute payment only if doing so results in a higher after-tax benefit to the participant. The participant
and the Company shall agree on a national accounting firm to perform the calculations necessary to determine
the
amount of the parachute payment, as well as the maximum amount the participant would be entitled to
receive
without
being
subject
to
the
excise
tax. The
PSU
award
is
not
subject
to
the
Change
in
Control
Plan
and
is
governed by the Performance Stock Unit Award Agreement and any pertinent employment agreement.
Potential Payments Upon Termination or Change in Control
The tables below give a reasonable estimate of the incremental amount of compensation that might be paid to each
of the Named Executive Officers in the event of termination of his employment on December 31, 2022. The amounts
shown assume that such termination, change in control, death or disability was effective as of December 31, 2022
and includes estimates of amounts to which the Named Executive Officer might be entitled incremental to what he
earned during such time. The actual amounts to be paid out can only be determined at the time of such executive’s
separation from the Company and may be changed at the discretion of the Compensation Committee.
Payments Made Upon Termination.
Regardless of the manner in which a Named Executive Officer’s employment
terminates, he is entitled to receive amounts earned during his term of employment. Such amounts include: accrued
salary, amounts contributed under the Employee Savings Plan and the Supplemental Savings Plan (see Non-qualified
Deferred Compensation Table) and amounts accrued and vested through the Company’s Retirement Plan and the
Supplemental Retirement Plan. (See Pension Benefits Table.) The retirement plans offer a survivor annuity, if elected by
the
participant.
For
a
termination
for
good
reason
or
without
cause,
each
of
Messrs. Andrade,
Karmilowicz,
Kociancic,
Employment, Change of Control and Other Agreements
2023 Proxy Statement
83
Williamson and Mukherjee would be eligible to earn all remaining installments of PSU subject to his signing a waiver
of all claims, and certain non-compete agreements under the terms of the employment agreements would apply. All
other PSU would be forfeited.
As noted above, on March 14, 2023, Everest announced that Sanjoy Mukherjee will be leaving the Company effective
April 21, 2023. Subject to the terms of the Transition Agreement, he will serve as an advisor to the Company from
April
22, 2023
through July
3, 2023
(the
“Separation
Date”)
and, for
such
services, he
will
receive
a
one-time
payment
of
$50,000. Subject to the terms of Mr. Mukherjee’s employment agreement and the Transition Agreement, Mr.
Mukherjee will receive accrued payments, vesting of equity awards, insurance benefits and a separation allowance in
accordance with the terms of his employment agreement, a one-time payment of two years of his base annual salary
payable in January 2025 and a cash payment in lieu of a tranche of six hundred and one (601) restricted shares that
would otherwise have vested on November 19, 2024 (based on the market price of the Company’s stock at the
close
of the New York Stock Exchange on the Separation Date).
Payments Made Upon Retirement.
In the event of retirement, in addition to the items above, all who are eligible will
receive the pension benefits shown in the Pension Benefits Table with a reduction for early retirement. Generally,
subject to satisfaction of the express terms of the pertinent equity award agreement that defines retirement as
reaching the age of 65 or older and a voluntary termination of employment, outstanding restricted shares vest as a
result of retirement with the consent of the Compensation Committee. PSU are forfeited if retirement occurs prior
to age 65. In the event of retirement at age 65 or older but prior to the conclusion of the restricted period (3rd
anniversary of grant date), the participant remains eligible to receive all remaining installments of PSU. The settlement
date of PSU for completed installment periods would be the 60-day anniversary of the retirement. The remaining PSU
would be settled between the certification that performance criteria have been met and March 15th of the calendar
year following the last performance period.
Payments Made Upon Death or Disability.
In the event of death or disability, in addition to the benefits listed under the
headings above, the Named Executive Officer will receive benefits under the Company’s disability plan or payments
under the Company’s life insurance program, as available to employees generally. Pursuant to the terms of their
employment agreements, in the event of the death or disability of Mr. Andrade, Mr. Williamson, Mr. Karmilowicz, Mr.
Kociancic, or Mr. Mukherjee, any incentive bonus earned but not yet paid for the completed full fiscal year immediately
preceding the employment termination date would be paid. So, assuming a hypothetical death or disability of those
Named Executive Officers on December 31, 2022, each would be entitled to any incentive bonus earned but not yet paid
relating to fiscal 2022 performance. Such bonus amounts would have been $2,900,000 for Mr. Andrade, $1,070,750
for Mr. Karmilowicz, $1,273,900 for Mr. Kociancic, $900,000 for Mr. Mukherjee and $1,167,000 for Mr. Williamson as
reported in the Summary Compensation Table.
In the event of the death or disability of any of the Named Executive Officers, unvested share options become
exercisable and the restrictions on restricted shares lapse. The following table lists the value of equity awards for each
Named Executive Officer at the NYSE closing price of $331.27 at 2022 year-end as if all vested on December 30,
2022. For PSU, in the event of death or disability prior to the conclusion of the restricted period (3rd anniversary of
grant date), the participant remains eligible to receive all remaining installments of PSU. The settlement date of PSU
for completed installment periods would be the 60-day anniversary of the death or disability. The remaining shares
would be settled between the certification of the performance and the March 15th of the calendar year following the
last performance period.
The number of
shares that would be delivered in the event of
an executive’s retirement at age 65 or death or disability
is
valued as of December 31, 2022 in the table below.
Name
PSU
Restricted
Shares
Total
Juan C. Andrade
$6,861,327
$10,955,761
$17,817,088
Mike Karmilowicz
$1,069,123
$ 2,277,150
$ 3,346,273
Mark Kociancic
$1,141,264
$ 6,424,982
$ 7,566,246
Sanjoy Mukherjee
$1,276,790
$ 2,426,553
$ 3,703,343
Jim Williamson
$
853,116
$ 2,790,950
$ 3,644,066
Employment, Change of Control and Other Agreements
84
2023 Proxy Statement
Termination or Change of Control
As
described
above, each
of
the
Named
Executive
Officers
is
a
participant
in
the
Company’s
Senior
Executive
Change
Control Plan. Payments are made under the plan to the respective Named Executive Officer if he suffers a covered
termination of employment within two years following a change in control. The table below gives a reasonable estimate
of what might be paid to each Named Executive Officer in the event of a covered termination of his employment on
December 31, 2022, based on the plan terms in effect at that time.
Messrs. Andrade, Karmilowicz, Kociancic, Williamson and Mukherjee’s employment agreements separately address
payments that may be made and benefits continued in the event of a termination without due cause or resignation
for good reason, outside of a change in control, as defined in the respective agreements.
Name
Incremental Benefit
Termination
Without
Cause or
Resignation
for Good Reason
Termination
Following
Change in
Control
Juan C. Andrade
Cash Payment
$
5,400,000
(1)
8,915,065
(5)
Restricted
Stock
Value
$
5,085,657
(2)
10,955,761
(6)
PSU Value
$
3,741,757
(3)
6,861,327
(7)
Benefits Continuation
$
57,092
(4)
40,000
Pension Enhancement
1,393,000
Total
Value
$
14,284,506
28,165,153
(8)
Mike Karmilowicz
Cash Payment
$
2,620,750
(1)
2,684,841
(5)
Restricted
Stock
Value
$
692,354
(2)
2,277,150
(6)
PSU Value
$
511,927
(3)
1,069,123
(7)
Benefits Continuation
$
28,888
(4)
40,000
Pension Enhancement
443,000
Total
Value
$
3,853,919
6,514,114
(8)
Mark Kociancic
Cash Payment
$
3,023,900
(1)
3,350,934
(5)
Restricted
Stock
Value
$
1,895,858
(2)
6,424,982
(6)
PSU Value
$
367,086
(3)
1,141,264
(7)
Benefits Continuation
$
28,546
(4)
40,000
Pension Enhancement
553,000
Total
Value
$
5,315,390
11,510,180
(8)
Sanjoy Mukherjee
Cash Payment
$
2,200,000
(1)
2,815,693
(5)
Restricted
Stock
Value
$
850,039
(2)
2,426,553
(6)
PSU Value
$
1,276,790
(3)
1,276,790
(7)
Benefits Continuation
$
18,465
(4)
26,000
Pension Enhancement
801,000
Total
Value
$
4,345,294
7,346,036
(8)
Jim Williamson
Cash Payment
$
2,767,000
(1)
2,824,616
(5)
Restricted
Stock
Value
$
741,382
(2)
2,790,950
(6)
PSU Value
$
265,444
(3)
853,116
(7)
Benefits Continuation
$
28,924
(4)
40,000
Pension Enhancement
408,000
Total
Value
$
3,802,750
6,916,682
(8)
Employment, Change of Control and Other Agreements
2023 Proxy Statement
85
(1)
Pursuant to the terms of the Mr. Andrade’s employment agreement, he would be paid a separation allowance in equal
installments over a 24-month period equal to two times his base salary. Messrs. Mukherjee, Karmilowicz, Kociancic and
Williamson would each be paid two times his base salary over a 12-month period. All would receive any annual incentive
bonus earned but not yet paid for the completed full fiscal year prior to termination.
(2)
Pursuant to the terms of the Named Executive Officer’s employment agreement, unvested restricted stock will continue
to vest in accordance with its terms in the 12-month period following termination for Messrs. Karmilowicz, Kociancic,
Mukherjee and Williamson. For Mr. Andrade, unvested stock would continue to vest for only the portions related to his
initial $10 million equity grant.
(3) Under
the
terms
of
their
respective
employment
agreements, Mr. Mukherjee
would
receive
the
PSU
installments
pursuant
achieved performance goals throughout the life of the PSU. Messrs. Andrade, Kociancic and Williamson would receive the
PSU installments pursuant to any performance goals achieved prior to departure from the Company. The remaining PSU
installments will vest pursuant to the Performance Stock Unit Award Agreement terms and are valued at the target
performance (100%) for purpose of this table.
(4)
Pursuant to the terms of the Named Executive Officer’s employment agreement, he shall continue to participate in the
disability and life insurance programs until the earlier of a certain number of months or his eligibility to be covered by
comparable benefits of a subsequent employer and he will receive a cash payment to enable him to pay for medical and
dental coverage for a certain number of months. For Mr. Andrade, the number is 24, for Messrs. Mukherjee, Karmilowicz,
Kociancic and Williamson it is 12.
(5) The Senior Executive Change of Control Agreement provides for a cash payment that equals the average of the executive’s
salary and bonus for the previous three years times a factor assigned by the Board. The factor is 2.0 for Messrs. Mukherjee,
Karmilowicz, Kociancic and Williamson and 2.5 for Mr. Andrade.
(6)
The unvested equity awards for each Named Executive Officer are valued at the NYSE closing price of $331.27 at 2022
year-end as if all vested on December 31, 2022.
(7)
In the event of a Change in Control, the Company may elect to continue the Performance Stock Awards subject to the
2010 Stock Incentive Plan and Performance Stock Unit Award Agreement. According to the award agreement, completed
installments are valued according to the actual achievement factor, and the remaining installments are valued at the target
performance (100%).
(8)
The Senior Executive Change of Control Plan includes a “Best Net” provision regarding the determination and treatment
of parachute payments that could potentially result in a reduced figure based on each participant’s relevant circumstances
as calculated by an accounting firm agreed to by the participant and the Company. Under the provision, in lieu of an
automatic reduction in benefits in the event of an excess parachute payment that triggers the excise tax, benefits are
reduced to avoid an excess parachute payment only if doing so results in a higher after-tax benefit to the participant.
Compensation Committee Interlocks and Insider Participation
86
2023 Proxy Statement
COMPENSATION COMMITTEE INTERLOCKS AND
INSIDER PARTICIPATION
During 2022, the Compensation Committee was comprised of John J. Amore, William F. Galtney, Jr., John A. Graf,
Meryl Hartzband, Gerri Losquadro, Roger M. Singer and John A. Weber until his passing, all of whom are Non-
Employee Directors of the Company and none of whom is or has been an officer of the Company. No Compensation
Committee interlocks existed during 2022.
Proposal No. 2—Appointment of Independent Auditors
2023 Proxy Statement
87
PROPOSAL NO. 2—APPOINTMENT OF INDEPENDENT
AUDITORS
The Board of Directors recommends that you vote FOR the appointment of PricewaterhouseCoopers LLP, an
independent registered public accounting firm, as the Company’s independent auditor for the year ending December
31,
2023 and the authorization of the Board of Directors acting by the Audit Committee of the Board of Directors to
determine the independent auditor’s remuneration. Proxies will be so voted unless shareholders specify otherwise
in their proxies.
PricewaterhouseCoopers LLP has been appointed to serve as the Company’s auditor each year at the Annual General
Meeting of Shareholders pursuant to the Board’s recommendation, which is based on the recommendation of the Audit
Committee. For the 2022 Annual General Meeting, and in accordance with the Sarbanes-Oxley Act of 2002 (“Sarbanes
Oxley”), the Audit Committee has evaluated the performance and independence of PricewaterhouseCoopers LLP
and has recommended their appointment as the Company’s independent auditor for the year ending December
31, 2023. In making its recommendation, the Audit Committee reviews both the audit scope and estimated fees for
professional services for the coming year. Representatives of PricewaterhouseCoopers LLP will be present at the
2023 Annual General Meeting, will have the opportunity to make a statement if they so desire and will be available to
respond to appropriate questions from shareholders.
Proposal No. 3—Non-Binding Advisory Vote on Executive Compensation
88
2023 Proxy Statement
PROPOSAL NO. 3—NON-BINDING ADVISORY VOTE ON
EXECUTIVE COMPENSATION
The Board of Directors recommends that you vote FOR the non-binding advisory approval of the Named Executive
Officers’ compensation. Proxies will be so voted unless shareholders specify otherwise in their proxies. Proxies given
beneficial holders to shareholders of record may not be so voted unless beneficial holders specify a vote for
approval in their proxies.
The Dodd-Frank Wall Street Reform and Consumer Protection Act of
2010, or the Dodd-Frank Act, enables shareholders
to
vote
to
approve, on
an
advisory
(nonbinding)
basis, the
compensation
of
the
Company’s
Named
Executive
Officers
as
disclosed in this Proxy Statement in accordance with the rules of the SEC.
As described in detail under the heading “Executive Compensation – Compensation Discussion and Analysis”, the
Company’s executive compensation program is designed to attract, reward and retain talented executives whose
abilities are critical to the success of the Company and its long-term goals of profitability and strong shareholder
returns. Please read the “Compensation Discussion and Analysis” discussion for additional details about our executive
compensation programs, including information about the fiscal year 2022 compensation of our Named Executive
Officers.
Shareholders are being asked to indicate their support for the Company’s Named Executive Officer compensation
as described in this Proxy Statement, which includes the “Compensation Discussion and Analysis” section and the
compensation tables and related narrative disclosure. This proposal, commonly known as a “say-on-pay” proposal,
gives
shareholders
the
opportunity
to
express
their
views
on
our
Named
Executive
Officers’
compensation. This
vote
is not intended to address any specific item of compensation, but rather the overall compensation of the Company’s
Named Executive Officers and the philosophy, policies and practices described in this Proxy Statement. Accordingly,
the Board recommends that you vote “FOR” on an advisory basis the compensation of the Named Executive Officers.
The say-on-pay vote is advisory and, therefore, not binding on the Company, the Compensation Committee or the
Board of Directors. However, the Board of Directors and the Compensation Committee value the opinions of the
Company’s shareholders and will review the voting results and consider shareholder concerns.
Proposal No. 4—Non-Binding Advisory Vote on the Frequency of the Advisory Vote on Executive Compensation
2023 Proxy Statement
89
PROPOSAL NO. 4—NON-BINDING ADVISORY VOTE
ON THE FREQUENCY OF THE ADVISORY VOTE ON
EXECUTIVE COMPENSATION
For the reasons set forth below, the Board of Directors recommends a vote for frequency of “EVERY YEAR” for
future non-binding shareholder votes on executive compensation. Proxies will be voted unless shareholders specify
otherwise in their proxies. Proxies given by beneficial holders to shareholders of record may not be so voted unless
beneficial holders specify a vote for frequency of “EVERY YEAR” in their proxies.
Pursuant to Rule 14a-21 under the Exchange Act, we are required to submit to shareholders an advisory, non-binding vote
asking them to indicate how frequently we should seek an advisory vote on the compensation of the Company’s
Named
Executive Officers, as disclosed pursuant to the SEC’s compensation disclosure rules, such as Proposal No. 3 of this
Proxy Statement. By voting on this Proposal No. 4, shareholders may indicate whether they would prefer an
advisory
vote on Named Executive Officer compensation once every one, two or three years, or they can abstain from
voting.
The advisory vote by the Company’s shareholders on frequency is distinct from the advisory vote on the compensation
of the Company’s Named Executive Officers. This deals with the issue of how frequently an advisory vote on
compensation should be presented to shareholders and, in this regard, shareholders may provide advice on the
following resolution:
“Resolved that the compensation of the Company’s Named Executive Officers be submitted to shareholders for an
advisory vote:
1.
Every year (annual);
2.
Every two years (biennial); or
3.
Every three years (triennial).”
You
may
vote
for
one
of
these
three
alternatives,
or
you
may
abstain
from
making
a
choice.
After careful consideration of this Proposal, the Board of Directors has determined that an advisory vote on executive
compensation that occurs every year (annually) is the most appropriate alternative for the Company, and therefore the
Board
of
Directors
recommends
that
you
vote
for
a
one-year
interval
for
the
advisory
vote
on
executive
compensation.
In formulating its recommendation, the Board of Directors considered the fact that the Compensation Committee
and the Board evaluate, adjust and approve Named Executive Officer compensation on an annual basis. The Board
believes that having an annual advisory vote on executive compensation will allow shareholders to provide timely
input on our compensation philosophy, policies and practices as disclosed in the Proxy Statement every year.
Additionally, an annual advisory vote on executive compensation is consistent with the Board’s desire to seek input
from shareholders on our executive compensation philosophy, policies and practices.
The option of one year, two years, or three years that receives the highest number of votes cast by shareholders will
be the frequency for the advisory vote on executive compensation that has been selected by shareholders. However,
because this vote is advisory and not binding on the Board of Directors in any way, the Board may decide that it is in
the best interests of our shareholders and the Company to hold an advisory vote on executive compensation more or
less
frequently than the option approved by shareholders.
Proposal
No. 5—
Change
the Name
of the Company
from
Everest
Re
Group,
Ltd. to
Everest Group,
Ltd. and to
Amend our Bye-Laws Accordingly
90
2023 Proxy Statement
PROPOSAL NO. 5—CHANGE THE NAME OF THE
COMPANY FROM EVEREST RE GROUP, LTD. TO
EVEREST GROUP, LTD. AND TO AMEND OUR BYE-LAWS
ACCORDINGLY
The Board of Directors recommends that you vote FOR a resolution, pursuant to Section 10 of the Bermuda Companies
Act 1981 (the “Act”), to change the name of the Company from “Everest Re Group, Ltd.” to “Everest Group, Ltd.”
and an accompanying amendment to the Company’s Bye-laws, Proxies will be so voted unless shareholders specify
otherwise in their proxies. Proxies given by beneficial holders to shareholders of record may not be so voted unless
beneficial holders specify a vote for approval in their proxies.
Shareholders are being asked to consider and approve the resolution to change the Company’s name and the
accompanying Bye-law amendment as described below. Under Sections 10(1), 13(5) and 77 of the Act and Sections
44 and 98 of our Bye-laws, our shareholders must approve the resolution and accompanying Bye-law amendment
by the affirmative vote of a majority of the votes cast at the Annual General Meeting. The Board has unanimously
approved the name change resolution and accompanying Bye-law amendment and recommends their approval and
adoption by the shareholders.
The name change proposal reflects Everest’s positioning and commitment to underwrite opportunity for colleagues,
customers, shareholders and communities worldwide, across both its insurance and reinsurance platforms. We have
been expanding our primary insurance business to benefit more people and places worldwide, while simultaneously
building
on
our
position
as
a
preeminent
global
reinsurance
leader
and
preferred
partner. Because
of
the
association
the word “Re” with reinsurance, the Board believes that the current name of Everest Re Group, Ltd. no longer
accurately reflects the full diversity of operations of the Company, and that the proposed name change will better
align with the Company’s refreshed brand and strategic evolution.
The name change proposal, if approved by our shareholders, would have the effect of changing the legal name of
the Company. The name change will be effectuated by filing a certified copy of the name change resolution with
the Bermuda Registrar of Companies. The Company intends to file the resolution promptly after the shareholders
approve the name change and to specify a future effective date and time for the name change in order to allow for
an orderly transition. The Company will announce the actual effective date and time of the name change via a press
release. If shareholders approve the name change, we also plan to change our stock ticker symbol from “RE” to “EG,”
effective at the same time as the name change becomes effective. Our CUSIP number will not change as a result of
the name change.
The name change proposal, if approved by our shareholders, would have the effect of changing the legal name of the
Company. The name change will become effective upon the filing of a certified copy of the name change resolution
with the Bermuda Registrar of Companies. The Company intends to file the resolution promptly after the shareholders
approve the name change and to specify a future effective date and time for the name change in order to allow for
an orderly transition. The Company will announce the actual effective date and time of the name change via a press
release. If shareholders approve the name change, we also plan to change our stock ticker symbol from “RE” to “EG,”
effective at the same time as the name change becomes effective. Our CUSIP number will not change as a result of
the name change.
If the name change is not approved, the Company’s legal name will continue to be Everest Re Group, Ltd.
The change in the Company’s name will not affect the legal status of the Company or the rights of any shareholder
in any respect, or the transferability of share certificates presently outstanding. The currently outstanding share
certificates evidencing shares of the Company’s securities bearing the name Everest Re Group, Ltd. will continue to be
valid and to represent shares of Everest Re Group, Ltd. following the name change. In the future, new share certificates
will be issued bearing the new name, but this will not affect the validity of current share certificates.
Miscellaneous —General
Matters
2023 Proxy Statement
91
MISCELLANEOUS—GENERAL MATTERS
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company’s executive officers and directors and persons who own more
than ten percent of a registered class of the Company’s equity securities, to file reports of ownership and changes in
ownership on Forms 3, 4 and 5 with the SEC. Executive officers, directors and greater than ten percent shareholders
are required by SEC regulation to furnish the Company with copies of all Forms 3, 4 and 5 they file.
Based solely on the Company’s review of the copies of the forms it has received and representations that no other
reports were required, the Company believes that all of its executive officers and directors have filed with the SEC on
a timely basis all required Forms 3, 4 and 5 with respect to transactions during fiscal year 2022.
Shareholder Proposals for the 2024 Annual General Meeting of Shareholders
To be considered for inclusion in the Company’s Proxy Statement and Proxy Card relating to the 2024 Annual General
Meeting of Shareholders, a shareholder proposal must be received by the Secretary of the Company in proper form
at the Company’s registered office at Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda, no later than
December 16, 2023. If the shareholder proposal relates to a nomination for director, then the proposal must be
made in accordance with the procedures set forth in Bye-law 12 and discussed in the section titled “Nominating
and Governance Committee.” This Bye-law is available on the Company’s website or by mail from the Corporate
Secretary’s office.
Proxy Solicitations
The expense of this proxy solicitation will be borne by the Company. In addition to solicitation by mail, proxies may
be solicited in person or by telephone, facsimile or mail by directors or officers who are employees of the Company
without additional compensation. Georgeson LLC will provide solicitation services to the Company for a fee not to
exceed $9,000 plus out-of-pocket expenses. The firm will solicit proxies by personal interview, telephone, facsimile
and mail. The Company will, on request, reimburse shareholders of record who are brokers, dealers, banks or voting
trustees, or their nominees, for their reasonable expenses in sending proxy materials and annual reports to the
beneficial owners of the shares they hold of record.
Transfer Agent and Registrar
The Company has appointed Computershare Trust Company, N.A. to serve as transfer agent, registrar and dividend
paying agent for the Common Shares. Correspondence relating to any share accounts or dividends should be
addressed to:
Computershare
Investor
Services
P.O. BOX 43006
Providence,
RI
02940-3006
Overnight correspondence should be sent to:
Computershare Investor Services
150 Royall St., Suite 101
Canton, MA 02021
(877) 373-6374 (Shareholder Services – Toll Free)
(781) 575-2725 (Shareholder Services)
All
transfers
of
certificates
for
Common
Shares
should
also
be
mailed
to
the
above
address.
By Order of the Board of Directors
Juan C. Andrade
President & CEO
April
14, 2023
[THIS PAGE INTENTIONALLY LEFT BLANK.]
[THIS PAGE INTENTIONALLY LEFT BLANK.]
jJ,
FSC
www.fsc.org
MIX
Paper
I
Supporting
responsible forestry
FSC
®
C127009
Everest vote ENDORSEMENT LINE SACKPACK -MR A SAMPLE DESIGNATION (IF ANY) ADD 1 ADD 2 ADD 3 ADD 4 ADD 5 ADD 6 C123456789 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext Your vote matters - here's how to vote! You may vote online or by phone instead of mailing this card. Votes submitted electronically must be received by May 16.2023 at 1159 P.M., Eastern Time. Online Go to www.investorvote.com/RE or scan the OR code - login details are located in the shaded bar below. Phone Call toll free 1-800-652-V0TE (8683) within the USA, US territories and Canada Save paper, time and money! Sign up for electronic delivery at www.inve storvote.com/RE Using a black ink pen. mart your votes with an X as shown in this example. Please do not write outside the designated areas. 2023 Annual Meeting Proxy Card ( 1234 5678 9012 345) IF WTING BY MAIL, SIGH, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. fl A Proposals - The Board of Directors recommend a vote FOR all the nominees listed and FOR Proposals 2,3 and 5 and for 1 YEAR on Proposal 4. t Election of Directors for a term to end in 2024.
01- John J. Amore 04-John A. Graf For Against Abstain 02 - Juan C. Andrade 05- Meryl Hartzband 08 - Roger M. Singer 07 - Hazel McNeilage For Against Abstain 03 - William F. Galtney, Jr. 06 - Gerri Losquadro 09 - Joseph V. Taranto For Against Abstain 3. For the approval, by non-binding advisory vote, of the 2022 compensation paid to the NEOs. 2. For the appointment of PricewaterhouseCoopers LLP as the Company's independent registered public account in g firm to act as the Company's independent auditor for 2023 and authorize the Company's Board of Directors acting through its Audit Committee to determine the independent auditor's remuneration. For Against Abstain For Against Abstain 4. Advisory Vote on the frequency of future advisory votes on executif compensation. 1 Year 2 Years 3 Years Abstain 5. To consider and approve a resolution to change the name of the Company from "Everest Re Group, Ltd." to "Everest Group, Ltd." and to amend our Bye-laws accordingly. For Against Abstain Q Authorized Signatures - This section must be completed for your vote to count. Please date and sign below. Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor,
administrator, corporate officer, trustee, guardian, or custodian, please give full title. Date (mm/dd/yyyy) - Please print date below. Signature 1 - Please keep signature within the box. Signature 2 - Please keep signature within the box. C 1234567890 J NT 1 U P X 575648 MR A SAMPLE (THIS AREA tS SET LP TO ACCOMMODATE 140 CHARACTERS) MR ASAM PLE AND MR A SAMPLE AMD MR A SAMPLE AMD MR A SAMLE AND MR A SAMPLE AMD MR A SAMPLE AMD MR A SAMLE AND MR A SAMPLE AMD
2023 Annual Meeting of Everest Re Group, Ltd. Shareholders Wednesday. May 17.2023.10:00 A.M. Local Time Fairmont Hamilton Princess, 76 Pitts Bay Road, Hamilton, Bermuda The proxy statement and annual report to shareholders are available at https://investors.everestre.com/shareholder -proxy-materials Small steps make an impact. Help the environment by consenting to receive electronic delivery, sign up at www.inves torvote.com/RE IF VOTING BY MAIL, SIGH, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. Everest Re Group, Ltd. Notice of 2023 Annual Meeting of Shareholders Proxy Solicited by Board of Directors for Annual Meeting - May 17,2023 The undersigned hereby appoints Juan C. Andrade and Mark Kociancic, and each of them, as proxies of the undersigned, each with full power to act without the others and with full power of substitution, to vote all the Common Shares of EVEREST RE GROUP, LTD. held in the name of the undersigned at the close of business on March 20, 2023, at the Annual General Meeting of Shareholders to be held on Wednesday, May 17, 2023, at Fairmont Hamilton Princess, 76 Pitts Bay Road, Hamilton, Bermuda at 10:00 a.m. (local time), and at any
adjournment or postponement thereof, with all the powers the undersigned would have if personally present, on the matters set forth hereon in accordance with any directions given by the undersigned and, in their discretion, on all other matters that may properly come before the Annual General Meeting, all in accordance with the accompanying Notice and Proxy Statement, receipt of which is acknowledged. IF THIS PROXY IS PROPERLY EXECUTED AND RETURNED, THE SHARES REPRESENTED THEREBY WILL BE VOTED. IF A CHOICE IS SPECIFIED BY THE SHAREHOLDER, THE SHARES WILL BE VOTED ACCORDINGLY. IF NOT OTHERWISE SPECIFIED, THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED FOR ALL THE NOMINEES LISTED AND FOR PROPOSALS 2,3 AND 5 AND FOR 1 YEAR ON PROPOSAL 4. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. Yo u are encouraged to specify your choices by marking the appropriate boxes (SEE REVERSE SIDO, but you need not mark any box if you wish to vote in accordance with the Board of Directors' recommendations. THE PROXIES CANNOT VOTE YOUR SHARES UNLESS YOU SIGN AND RETURN THIS CARD. (Items to be voted appear on reverse side) C Non-Voting Items
Change of Address - Please print new address below. Comments - Please print your comments below.