CNA, Berkshire deal eliminates legacy liability; National Indemnity to take CNA's asbestos risk for $2 billion.(NEWS)

Byline: JUDY GREENWALD

CNA Financial Corp.'s agreement to cede $1.6 billion in net asbestos and environmental pollution liabilities to Berkshire Hathaway Inc. and pay a $2 billion premium to Berkshire for $4 billion in reinsurance coverage removes a potentially major legacy liability for CNA, experts and analysts say.

The agreement between several CNA units and Berkshire unit National Indemnity Co. will cover credit risks on existing third-party reinsurance related to the liabilities, CNA said last week.

"We believe this transaction is consistent with our focus on financial stability and delivering improved levels of operating consistency as we effectively …