XML 25 R12.htm IDEA: XBRL DOCUMENT
v3.20.2

Reserve for Losses and Loss Adjustment Expenses | 9 Months Ended
--- | ---
Sep. 30, 2020
Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract] |
Reserve for losses and loss adjustment expenses | Reserve for Losses and Loss Adjustment Expenses The following table represents an analysis of losses and loss adjustment expenses and a reconciliation of the beginning and ending reserve for losses and loss adjustment expenses:
| Three Months Ended |  | Nine Months Ended
| September 30, |  | September 30,
| 2020 |  | 2019 |  | 2020 |  | 2019
Reserve for losses and loss adjustment expenses at beginning of period | $ | 15,044,874 |  |  | $ | 12,230,316 |  |  | $ | 13,891,842 |  |  | $ | 11,853,297 |
Unpaid losses and loss adjustment expenses recoverable | 4,156,157 |  |  | 3,024,797 |  |  | 4,082,650 |  |  | 2,814,291 |
Net reserve for losses and loss adjustment expenses at beginning of period | 10,888,717 |  |  | 9,205,519 |  |  | 9,809,192 |  |  | 9,039,006 |
Net incurred losses and loss adjustment expenses relating to losses occurring in: |  |  |  |  |  |  |
Current year | 1,264,315 |  |  | 855,352 |  |  | 3,673,346 |  |  | 2,419,044 |
Prior years | (48,042) |  |  | (52,897) |  |  | (111,132) |  |  | (130,514) |
Total net incurred losses and loss adjustment expenses | 1,216,273 |  |  | 802,455 |  |  | 3,562,214 |  |  | 2,288,530 |
Retroactive reinsurance transactions (1) | — |  |  | — |  |  | 60,635 |  |  | (225,500) |
Net foreign exchange (gains) losses | 114,122 |  |  | (73,200) |  |  | 22,706 |  |  | (74,981) |
Net paid losses and loss adjustment expenses relating to losses occurring in: |  |  |  |  |  |  |
Current year | (189,961) |  |  | (175,611) |  |  | (359,395) |  |  | (301,099) |
Prior years | (512,263) |  |  | (399,948) |  |  | (1,578,464) |  |  | (1,366,741) |
Total net paid losses and loss adjustment expenses | (702,224) |  |  | (575,559) |  |  | (1,937,859) |  |  | (1,667,840) |
Net reserve for losses and loss adjustment expenses at end of period | 11,516,888 |  |  | 9,359,215 |  |  | 11,516,888 |  |  | 9,359,215 |
Unpaid losses and loss adjustment expenses recoverable | 4,383,638 |  |  | 3,030,169 |  |  | 4,383,638 |  |  | 3,030,169 |
Reserve for losses and loss adjustment expenses at end of period | $ | 15,900,526 |  |  | $ | 12,389,384 |  |  | $ | 15,900,526 |  |  | $ | 12,389,384 |
(1) During 2020 first quarter, a subsidiary of the Company entered into a reinsurance to close agreement of the 2017 and prior years of account previously covered by a third party arrangement, while in the 2019 first quarter, a subsidiary of the Company entered into a retroactive reinsurance transaction with third party reinsurer to reinsure run-off liabilities associated with certain U.S. insurance exposures. Development on Prior Year Loss Reserves 2020 Third Quarter During the 2020 third quarter, the Company recorded net favorable development on prior year loss reserves of $48.0 million, which consisted of $2.3 million from the insurance segment, $42.0 million from the reinsurance segment, $4.5 million from the mortgage segment, partially offset by $0.7 million unfavorable from the ‘other’ segment. The insurance segment’s net favorable development of $2.3 million, or 0.3 loss ratio points, for the 2020 third quarter consisted of $12.9 million of net favorable development in short-tailed and long-tailed lines and $10.6 million of net adverse development in medium-tailed lines. Net favorable development of $11.8 million in short-tailed lines reflected $8.0 million of favorable development from property (excluding marine), primarily from the 2015 to 2018 accident years (i.e., the year in which a loss occurred) and $3.4 million of favorable development in travel and accident, primarily from the 2019 accident year. Net favorable development of $1.1 million in long-tailed lines reflected $8.7 million of favorable development in construction and national accounts, primarily from the 2018 accident year, and $4.2 million of favorable development related to other business, including alternative markets and excess workers’ compensation, primarily from the 2013 to 2017 accident years, partially offset by $11.7 million of adverse development in executive assurance and casualty, primarily from the 2015 and 2019 accident year. Net adverse development in medium-tailed lines included $7.1 million of adverse development in program business, primarily from 2015 to 2018 accident years and $3.7 million of adverse development in contract binding, across all accident years. The reinsurance segment’s net favorable development of $42.0 million, or 7.6 loss ratio points, for the 2020 third quarter consisted of $45.6 million of net favorable development in short-tailed and medium-tailed lines and net adverse development of $3.6 million from long-tailed lines. Net favorable development in short-tailed lines reflected $27.6 million of favorable development related to property catastrophe and property other than property catastrophe business, primarily from the 2016 to 2019 underwriting years (i.e., all premiums and losses attributable to contracts having an inception or renewal date within the given twelve-month period), and $7.8 million of favorable development from other specialty, primarily from the 2016 to 2019 underwriting years. Net favorable development of $9.4 million in medium-tailed lines reflected favorable development in marine and aviation across most underwriting years. Adverse development of $3.6 million in long-tailed lines reflected an increase in reserves from casualty, primarily from the 2012 to 2019 underwriting years. The mortgage segment’s net favorable development was $4.5 million, or 1.3 loss ratio points, for the 2020 third quarter, primarily driven by subrogation recoveries on second lien business and student loan business. 2019 Third Quarter During the 2019 third quarter, the Company recorded net favorable development on prior year loss reserves of $52.9 million, which consisted of $4.4 million from the insurance segment, $15.3 million from the reinsurance segment, $33.0 million from the mortgage segment and $0.2 million from the ‘other’ segment. The insurance segment’s net favorable development of $4.4 million, or 0.7 loss ratio points, for the 2019 third quarter consisted of $24.8 million of net favorable development in short-tailed lines and $20.4 million of net adverse development in medium-tailed and long-tailed lines. Net favorable development in short-tailed lines primarily resulted from lenders products and property (including special risk other than marine) reserves across all accident years (i.e., the year in which a loss occurred). Net adverse development in medium-tailed and long-tailed lines included $6.3 million of adverse development in executive assurance reserves, primarily from the 2016 to 2018 accident years, $4.9 million of adverse development in casualty reserves, primarily related to contract binding business across most accident years, $4.2 million of adverse development in program business, primarily from the 2018 accident year, and $3.8 million in healthcare reserves, primarily from the 2016 to 2018 accident years. The reinsurance segment’s net favorable development of $15.3 million, or 4.2 loss ratio points, for the 2019 third quarter consisted of $35.2 million of net favorable development from short-tailed and medium-tailed lines and net adverse development of $19.9 million from long-tailed lines. Net favorable development in short-tailed and medium lines reflected $26.5 million of favorable development from property catastrophe and property other than property catastrophe reserves, primarily related to 2017 and 2018 catastrophic events, and favorable development in marine and aviation and other reserves across most underwriting years (i.e., all premiums and losses attributable to contracts having an inception or renewal date within the given twelve-month period). Adverse development in long-tailed lines reflected an increase in reserves from casualty from various underwriting years. The mortgage segment’s net favorable development was $33.0 million, or 9.6 loss ratio points, for the 2019 third quarter. The 2019 third quarter development was primarily driven by favorable claim rates on first lien business and subrogation recoveries on second lien and student loan business. Nine Months Ended September 30, 2020 During the nine months ended September 30, 2020, the Company recorded net favorable development on prior year loss reserves of $111.1 million, which consisted of $5.9 million from the insurance segment, $93.8 million from the reinsurance segment, $10.8 million from the mortgage segment and $0.6 million from the ‘other’ segment. The insurance segment’s net favorable development of $5.9 million, or 0.3 loss ratio points, for the 2020 period consisted of $41.6 million of net favorable development in short-tailed and long-tailed lines, partially offset by $35.7 million of net adverse development in medium-tailed lines. Net favorable development of $27.2 million in short-tailed lines reflected $17.5 million of favorable development from property (excluding marine), primarily from the 2015 to 2018 accident years, $6.2 million of favorable development on travel and accident, primarily from 2019 accident year, and $3.5 million of favorable development in lenders products, primarily from the 2018 and 2019 accident years. Net favorable development of $14.4 million in long-tailed lines included $11.7 million of favorable development related to other business, including alternative markets and excess workers’ compensation, primarily from the 2013 to 2017 accident years. Net adverse development in medium-tailed lines reflected $23.0 million of adverse development in contract binding business, across all accident years, and $13.5 million of adverse development in program business, primarily from the 2016 to 2018 accident years. The reinsurance segment’s net favorable development of $93.8 million, or 5.9 loss ratio points, for the 2020 period consisted of $113.0 million of net favorable development from short-tailed and medium-tailed lines, partially offset by $19.2 million of net adverse development from long-tailed lines. Net favorable development of $101.8 million in short-tailed lines reflected $52.1 million related to property catastrophe and property other than property catastrophe business, primarily from the 2016 to 2019 underwriting years, and $47.1 million from other specialty lines, across most underwriting years. Adverse development in long-tailed lines of $19.2 million reflected an increase in reserves from casualty, primarily from the 2012 to 2015 underwriting years. The mortgage segment’s net favorable development was $10.8 million, or 1.0 loss ratio points, for the 2020 period, primarily driven by subrogation recoveries on second lien business and student loan business. Nine Months Ended September 30, 2019 During the nine months ended September 30, 2019, the Company recorded net favorable development on prior year loss reserves of $130.5 million, which consisted of $11.4 million from the insurance segment, $26.3 million from the reinsurance segment, $92.5 million from the mortgage segment and $0.3 million from the ‘other’ segment. The insurance segment’s net favorable development of $11.4 million, or 0.7 loss ratio points, for the 2019 period consisted of $42.6 million of net favorable development in short-tailed lines, partially offset by $31.2 million of net adverse development in medium-tailed and long-tailed lines. Net favorable development in short-tailed lines primarily resulted from lenders products and property (including special risk other than marine) reserves across all accident years, partially offset by net adverse development in travel business, primarily from the 2018 accident year. Net adverse development in medium-tailed and long-tailed lines reflected $27.4 million of adverse development in program business, primarily from the 2018 accident year, and $12.8 million of adverse development in casualty business, primarily from contract binding business across most accident years. Such amounts were partially offset by $9.0 million of net favorable development in other medium-tailed and long-tailed lines, including professional liability, marine and surety business, across most accident years. The reinsurance segment’s net favorable development of $26.3 million, or 2.4 loss ratio points, for the 2019 period consisted of $37.1 million of net favorable development from short-tailed and medium-tailed lines, offset by $10.8 million of net adverse development from long-tailed lines. Net favorable development in short-tailed lines reflected $22.6 million from other specialty lines and $9.5 million from property catastrophe reserves. Favorable development in medium-tailed lines reflected reductions in marine and aviation reserves of $10.4 million across most underwriting years. The mortgage segment’s net favorable development was $92.5 million, or 9.1 loss ratio points, for the 2019 period. The 2019 development was primarily driven by lower than expected claim rates on first lien business and subrogation recoveries on second lien and student loan business.

X
- References No definition available. + Details
Name: | us-gaap_LiabilityForFuturePolicyBenefitsAndUnpaidClaimsAndClaimsAdjustmentExpenseAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for liabilities related to future policy benefits and unpaid claims and claim adjustments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 40 -URI http://asc.fasb.org/subtopic&trid=2560295 + Details
Name: | us-gaap_LiabilityForFuturePolicyBenefitsAndUnpaidClaimsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration