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Short Duration Contracts

12 Months Ended

Dec. 31, 2021

Short Duration Contracts Disclosure [Abstract]

Short duration contracts

The Company’s reserves for losses and loss adjustment expenses primarily relate to short-duration contracts with various characteristics (e.g., type of coverage, geography, claims duration). The Company considered such information in determining the level of disaggregation for disclosures related to its short-duration contracts, as detailed in the table below:

Reportable segment

Level of disaggregation

Included lines of business

Insurance

Property energy, marine and aviation

Property energy, marine and aviation

Third party occurrence business

Excess and surplus casualty (excluding contract binding); construction and national accounts; and other (including alternative market risks, excess workers’ compensation and employer’s liability insurance coverages)

Third party claims-made business

Professional lines

Multi-line and other specialty

Programs; contract binding (part of excess and surplus casualty); travel, accident and health; lenders products; and other (contract and commercial surety coverages)

Reinsurance

Casualty

Casualty

Property catastrophe

Property catastrophe

Property excluding property catastrophe

Property excluding property catastrophe

Marine and aviation

Marine and aviation

Other specialty

Other specialty

Mortgage

Direct mortgage insurance in the U.S.

Mortgage insurance on U.S. primary exposures

The Company determined the following to be insignificant for disclosure purposes: (i) certain mortgage business, including non-U.S. primary business, second lien and student loan exposures, global mortgage reinsurance and participation in various GSE credit risk-sharing products, (ii) certain reinsurance business, including casualty clash and non-traditional lines and (iii) amounts associated with Southern Rock Holdings Limited. See Note 2. Such amounts are included as reconciling items.

The Company is required to establish reserves for losses and loss adjustment expenses (“Loss Reserves”) that arise from the business the Company underwrites. Loss Reserves for the insurance, reinsurance and mortgage segments represent estimates of future amounts required to pay losses and loss adjustment expenses for insured or reinsured events which have occurred at or before the balance sheet date. Loss Reserves do not reflect contingency reserve allowances to account for future loss occurrences. Losses arising from

future events will be estimated and recognized at the time the losses are incurred and could be substantial.

Insurance Segment

Loss Reserves for the insurance segment are comprised of estimated amounts for (1) reported losses (“case reserves”) and (2) incurred but not reported losses (“IBNR reserves”). Generally, claims personnel determine whether to establish a case reserve for the estimated amount of the ultimate settlement of individual claims. The estimate reflects the judgment of claims personnel based on general corporate reserving practices, the experience and knowledge of such personnel regarding the nature and value of the specific type of claim and, where appropriate, advice of counsel. The Company also contracts with a number of outside third party administrators in the claims process who, in certain cases, have limited authority to establish case reserves. The work of such administrators is reviewed and monitored by our claims personnel. Loss Reserves are also established to provide for loss adjustment expenses and represent the estimated expense of settling claims, including legal and other fees and the general expenses of administering the claims adjustment process. Periodically, adjustments to the case reserves may be made as additional information is reported or payments are made. IBNR reserves are established to provide for incurred claims which have not yet been reported at the balance sheet date as well as to adjust for any projected variance in case reserving. Actuaries estimate ultimate losses and loss adjustment expenses using various generally accepted actuarial methods applied to known losses and other relevant information. Like case reserves, IBNR reserves are adjusted as additional information becomes known or payments are made. The process of estimating reserves involves a considerable degree of judgment by management and, as of any given date, is inherently uncertain.

Ultimate losses and loss adjustment expenses are generally determined by projection of claim emergence and settlement patterns observed in the past that can reasonably be expected to persist into the future. In forecasting ultimate losses and loss adjustment expenses with respect to any line of business, past experience with respect to that line of business is the primary resource, developed through both industry and company experience, but cannot be relied upon in isolation. Uncertainties in estimating ultimate losses and loss adjustment expenses are magnified by the length of the time lag between when a claim actually occurs and when it is reported and settled. This time lag is sometimes referred to as the “claim-tail.” During this period additional facts regarding coverages written in prior accident years, as well as about actual claims and trends, may become known and, as a result, may lead to adjustments of the related Loss Reserves. If the Company determines that an adjustment is appropriate, the adjustment is recorded in the accounting period in which such determination is made. Accordingly, should Loss

Reserves need to be increased or decreased in the future from amounts currently established, future results of operations would be negatively or positively impacted respectively. The Company authorizes managing general agents, general agents and other producers to write program business on the Company’s behalf within prescribed underwriting authorities. This delegated authority process introduces additional complexity to the actuarial determination of unpaid future losses and loss adjustment expenses. In order to monitor adherence to the underwriting guidelines given to such parties, the Company periodically performs underwriting and claims due diligence reviews.

In determining ultimate losses and loss adjustment expenses, the cost to indemnify claimants, provide needed legal defense and other services for insureds and administer the investigation and adjustment of claims are considered. These claim costs are influenced by many factors that change over time, such as expanded coverage definitions as a result of new court decisions, inflation in costs to repair or replace damaged property, inflation in the cost of medical services and legislated changes in statutory benefits, as well as by the particular, unique facts that pertain to each claim. As a result, the rate at which claims arose in the past and the costs to settle them may not always be representative of what will occur in the future. The factors influencing changes in claim costs are often difficult to isolate or quantify and developments in paid and incurred losses from historical trends are frequently subject to multiple and conflicting interpretations. Changes in coverage terms or claims handling practices may also cause future experience and/or development patterns to vary from the past. A key objective of actuaries in developing estimates of ultimate losses and loss adjustment expenses, and resulting IBNR reserves, is to identify aberrations and systemic changes occurring within historical experience and adjust for them so that the future can be projected more reliably. Because of the factors previously discussed, this process requires the substantial use of informed judgment and is inherently uncertain.

Although Loss Reserves are initially determined based on underwriting and pricing analyses, the Company’s insurance segment applies several generally accepted actuarial methods, as discussed below, on a quarterly basis to evaluate the Loss Reserves, in addition to the expected loss method, in particular for Loss Reserves from more mature accident years (the year in which a loss occurred). Each quarter, as part of the reserving process, the segments’ actuaries reaffirm that the assumptions used in the reserving process continue to form a sound basis for the projection of liabilities. If actual loss activity differs substantially from expectations based on historical information, an adjustment to Loss Reserves may be supported. The Company places more or less reliance on a particular actuarial method based on the facts and circumstances at the time the estimates of Loss Reserves are made.

These methods generally fall into one of the following categories or are hybrids of one or more of the following categories:

•Expected loss methods - these methods are based on the assumption that ultimate losses vary proportionately with premiums. Expected loss and loss adjustment expense ratios are typically developed based upon the information derived by underwriters and actuaries during the initial pricing of the business, supplemented by industry data available from organizations, such as statistical bureaus and consulting firms, where appropriate. These ratios consider, among other things, rate increases and changes in terms and conditions that have been observed in the market. Expected loss methods are useful for estimating ultimate losses and loss adjustment expenses in the early years of long-tailed lines of business, when little or no paid or incurred loss information is available, and is commonly applied when limited loss experience exists for a company.

•Historical incurred loss development methods - these methods assume that the ratio of losses in one period to losses in an earlier period will remain constant in the future. These methods use incurred losses (i.e., the sum of cumulative historical loss payments plus outstanding case reserves) over discrete periods of time to estimate future losses. Historical incurred loss development methods may be preferable to historical paid loss development methods because they explicitly take into account open cases and the claims adjusters’ evaluations of the cost to settle all known claims. However, historical incurred loss development methods necessarily assume that case reserving practices are consistently applied over time. Therefore, when there have been significant changes in how case reserves are established, using incurred loss data to project ultimate losses may be less reliable than other methods.

•Historical paid loss development methods - these methods, like historical incurred loss development methods, assume that the ratio of losses in one period to losses in an earlier period will remain constant. These methods use historical loss payments over discrete periods of time to estimate future losses and necessarily assume that factors that have affected paid losses in the past, such as inflation or the effects of litigation, will remain constant in the future. Because historical paid loss development methods do not use incurred losses to estimate ultimate losses, they may be more reliable than the other methods that use incurred losses in situations where there are significant changes in how incurred losses are established by a company’s claims adjusters. However, historical paid loss development methods are more leveraged (meaning that small changes in payments have a larger impact on estimates of ultimate losses) than

actuarial methods that use incurred losses because cumulative loss payments take much longer to equal the expected ultimate losses than cumulative incurred amounts. In addition, and for similar reasons, historical paid loss development methods are often slow to react to situations when new or different factors arise than those that have affected paid losses in the past.

•Adjusted historical paid and incurred loss development methods - these methods take traditional historical paid and incurred loss development methods and adjust them for the estimated impact of changes from the past in factors such as inflation, the speed of claim payments or the adequacy of case reserves. Adjusted historical paid and incurred loss development methods are often more reliable methods of predicting ultimate losses in periods of significant change, provided the actuaries can develop methods to reasonably quantify the impact of changes. As such, these methods utilize more judgment than historical paid and incurred loss development methods.

•Bornhuetter-Ferguson (“B-F”) paid and incurred loss methods - these methods utilize actual paid and incurred losses and expected patterns of paid and incurred losses, taking the initial expected ultimate losses into account to determine an estimate of expected ultimate losses. The B-F paid and incurred loss methods are useful when there are few reported claims and a relatively less stable pattern of reported losses.

•Frequency-Severity methods - These methods utilize actual paid and incurred claim experience, but break the data down into its component pieces: claim counts, often expressed as a ratio to exposure or premium (frequency), and average claim size (severity). The component pieces are projected to an ultimate level and multiplied together to result in an estimate of ultimate loss. These methods are especially useful when the severity of claims can be confined to a relatively stable range of estimated ultimate average claim value.

•Additional analyses - other methodologies are often used in the reserving process for specific types of claims or events, such as catastrophic or other specific major events. These include vendor catastrophe models, which are typically used in the estimation of Loss Reserves at the early stage of known catastrophic events before information has been reported to an insurer or reinsurer.

In the initial reserving process for short-tail insurance lines (consisting of property, energy, marine and aviation and other exposures including travel, accident and health and lenders products), the Company relies on a combination of the reserving methods discussed above. For catastrophe-exposed business, the reserving process also includes the usage of catastrophe models for known events and a heavy

reliance on analysis of individual catastrophic events and management judgment. The development of losses on short-tail business can be unstable, especially for policies characterized by high severity, low frequency losses. As time passes, for a given accident year, additional weight is given to the paid and incurred B-F loss development methods and eventually to the historical paid and incurred loss development methods in the reserving process. The Company makes a number of key assumptions in their reserving process, including that historical paid and reported development patterns are stable, catastrophe models provide useful information about our exposure to catastrophic events that have occurred and underwriters’ judgment as to potential loss exposures can be relied on. The expected loss ratios used in the initial reserving process for short-tail business have varied over time due to changes in pricing, reinsurance structure, estimates of catastrophe losses, policy changes (such as attachment points, class and limits) and geographical distribution. As losses in short-tail lines are reported relatively quickly, expected loss ratios are selected for the current accident year based upon actual attritional loss ratios for earlier accident years, adjusted for rate changes, inflation, changes in reinsurance programs and expected attritional losses based on modeling. Furthermore, ultimate losses for short-tail business are known in a reasonably short period of time.

In the initial reserving process for medium-tail and long-tail insurance lines (consisting of third party occurrence business, third party claims made business, and other exposures including surety, programs and contract binding exposures), the Company primarily relies on the expected loss method. The development of the Company’s medium-tail and long-tail business may be unstable, especially if there are high severity major events, as a portion of the Company’s casualty business is in high excess layers. As time passes, for a given accident year, additional weight is given to the paid and incurred B-F loss development methods and historical paid and incurred loss development methods in the reserving process. The Company makes a number of key assumptions

in reserving for medium-tail and long-tail lines, including that the pricing loss ratio is the best estimate of the ultimate loss ratio at the time the policy is entered into, that the loss development patterns, which are based on a combination of company and industry loss development patterns and adjusted to reflect differences in the insurance segment’s mix of business, are reasonable and that claims personnel and underwriters analyses of our exposure to major events are assumed to be the best estimate of exposure to the known claims on those events. The expected loss ratios used in the initial reserving process for medium-tail and long-tail business for recent accident years have varied over time, in some cases significantly, from earlier accident years. As the credibility of historical experience for earlier accident years increases, the experience from these accident years will be given a greater weighting in the actuarial analysis to determine future accident year expected loss ratios, adjusted for changes in pricing, loss trends, terms and conditions and reinsurance structure.

In 2021 and 2018, the Company entered into loss portfolio transfer and adverse development cover reinsurance agreements accounted for as retroactive reinsurance. The agreements transfers Loss Reserves and future favorable or adverse development on certain runoff programs and certain third party occurrence business, within multi-line and other specialty business (the “Covered Lines”). As incurred losses and allocated loss adjustment expenses for the Covered Lines are ceded to the reinsurer, the Company is not exposed to changes in the amount, timing and uncertainty of cash flows arising from the Covered Lines. To avoid distortion, the incurred losses and allocated loss adjustment expenses and cumulative paid losses and loss adjustment expenses for the Covered Lines are excluded entirely from the tables below. Unpaid loss and loss adjustment expenses recoverable at December 31, 2021 included $390.1 million related to such reinsurance agreements.

The following tables present information on the insurance segment’s short-duration insurance contracts:

Property, energy, marine and aviation ($000’s except claim count)
Incurred losses and allocated loss adjustment expenses, net of reinsurance																																																																		December 31, 2021
																																																																		Total of IBNR liabilities plus expected development on reported claims						Cumulative number of reported claims
						Year ended December 31,
Accident year						2012 unaudited						2013 unaudited						2014 unaudited						2015 unaudited						2016 unaudited						2017 unaudited						2018 unaudited						2019 unaudited						2020 unaudited						2021
2012						$	233,149					$	232,498					$	205,776					$	199,469					$	197,005					$	192,993					$	190,770					$	178,616					$	178,250					$	178,343					$	627					4,245
2013												159,102						156,785						149,199						143,400						134,952						133,869						128,624						127,290						126,276						25						4,243
2014																		148,368						145,957						147,465						136,201						132,307						134,329						135,032						134,942						3,098						3,884
2015																								112,409						109,865						103,995						102,515						97,852						91,830						91,892						3,804						4,536
2016																														104,449						101,306						105,657						100,471						96,437						92,553						874						6,160
2017																																				280,715						246,291						235,951						230,439						231,228						8,248						6,426
2018																																										180,981						186,030						173,693						170,057						9,136						5,020
2019																																																179,056						178,564						165,477						6,667						5,080
2020																																																						359,394						329,362						66,698						4,186
2021																																																												426,870						158,163						2,951
																																																						Total						$	1,947,000
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance
2012						$	20,638					$	93,394					$	138,977					$	161,831					$	167,540					$	179,945					$	181,307					$	173,184					$	174,032					$	174,384
2013												32,292						84,936						110,808						120,111						122,244						125,475						123,356						124,688						124,841
2014																		25,881						53,751						77,892						84,195						87,812						98,553						115,383						122,296
2015																								23,580						64,953						76,338						86,253						87,926						86,246						87,316
2016																														24,828						83,552						98,683						97,506						95,002						91,241
2017																																				30,228						139,867						195,532						211,708						215,895
2018																																										30,026						102,285						134,858						142,838
2019																																																26,130						105,380						133,911
2020																																																						55,619						194,487
2021																																																												90,423
																														Total																														1,377,632
																														All outstanding liabilities before 2012, net of reinsurance																														17,517
																								Liabilities for losses and loss adjustment expenses, net of reinsurance																																				$	586,885

Third party occurrence business ($000’s except claim count)
						Incurred losses and allocated loss adjustment expenses, net of reinsurance																																																												December 31, 2021
																																																																		Total of IBNR liabilities plus expected development on reported claims						Cumulative number of reported claims
						Year ended December 31,
Accident year						2012 unaudited						2013 unaudited						2014 unaudited						2015 unaudited						2016 unaudited						2017 unaudited						2018 unaudited						2019 unaudited						2020 unaudited						2021
2012						$	241,368					$	263,451					$	269,204					$	272,004					$	258,371					$	253,758					$	243,863					$	244,448					$	242,332					$	239,075					$	43,924					65,731
2013												283,228						297,225						307,152						302,165						282,122						274,717						272,849						269,754						270,558						54,640						67,113
2014																		330,015						336,019						338,890						343,113						339,701						344,197						342,934						343,569						66,498						75,904
2015																								359,058						391,884						398,908						392,143						391,455						382,722						386,801						91,081						78,785
2016																														389,832						394,485						406,082						399,571						374,896						367,818						115,303						79,005
2017																																				417,377						417,941						422,624						412,512						407,115						145,130						84,692
2018																																										430,415						453,190						450,937						451,459						189,965						77,700
2019																																																456,353						487,547						481,045						253,849						84,895
2020																																																						607,249						616,910						428,750						89,560
2021																																																												622,713						543,386						65,477
																																																						Total						$	4,187,063
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance
2012						$	6,984					$	30,915					$	58,650					$	83,637					$	108,660					$	130,098					$	143,885					$	155,085					$	163,016					$	168,119
2013												6,857						29,265						71,449						101,293						122,288						149,292						164,403						174,946						184,800
2014																		9,228						40,346						71,624						112,702						162,123						191,305						211,643						224,101
2015																								11,139						44,605						88,515						139,492						181,704						211,715						227,697
2016																														11,709						41,979						87,616						136,870						164,662						194,773
2017																																				13,408						52,356						99,874						135,111						165,606
2018																																										17,025						63,848						115,137						154,248
2019																																																18,431						73,222						121,859
2020																																																						24,509						76,743
2021																																																												26,301
																														Total																														1,544,247
																														All outstanding liabilities before 2012, net of reinsurance																														242,741
																								Liabilities for losses and loss adjustment expenses, net of reinsurance																																				$	2,885,557

Third party claims-made business ($000’s except claim count)
Incurred losses and allocated loss adjustment expenses, net of reinsurance																																																																		December 31, 2021
																																																																		Total of IBNR liabilities plus expected development on reported claims						Cumulative number of reported claims
						Year ended December 31,
Accident year						2012 unaudited						2013 unaudited						2014 unaudited						2015 unaudited						2016 unaudited						2017 unaudited						2018 unaudited						2019 unaudited						2020 unaudited						2021
2012						$	317,654					$	320,207					$	318,453					$	313,907					$	291,316					$	275,665					$	277,683					$	285,163					$	285,527					$	286,118					$	11,570					15,576
2013												301,956						320,659						324,442						320,524						294,674						291,205						281,996						271,501						273,948						11,739						15,696
2014																		264,537						279,846						299,104						279,043						282,058						298,017						292,247						288,318						22,336						15,676
2015																								258,989						277,615						276,492						260,063						255,432						252,478						267,925						20,617						14,724
2016																														275,394						291,645						308,453						314,747						322,042						327,230						42,509						15,749
2017																																				271,088						286,565						312,554						308,917						323,854						60,718						16,404
2018																																										273,521						315,085						320,653						337,083						85,411						15,854
2019																																																290,217						318,469						318,498						119,673						12,982
2020																																																						384,852						414,580						240,888						10,049
2021																																																												516,420						435,910						8,550
																																																						Total						$	3,353,974
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance
2012						$	17,718					$	69,069					$	121,211					$	164,724					$	190,395					$	209,295					$	227,389					$	251,313					$	255,337					$	260,173
2013												19,032						87,458						137,963						179,395						198,008						217,132						238,951						245,687						247,078
2014																		13,817						63,312						129,712						173,089						208,074						229,958						243,791						249,960
2015																								9,066						52,046						100,089						126,499						174,161						193,186						216,986
2016																														10,568						68,226						127,286						158,230						205,596						242,431
2017																																				9,306						67,669						113,208						143,340						196,125
2018																																										12,287						68,424						118,361						158,709
2019																																																12,418						65,477						122,362
2020																																																						17,161						87,547
2021																																																												23,349
																														Total																														1,804,720
																														All outstanding liabilities before 2012, net of reinsurance																														64,171
																								Liabilities for losses and loss adjustment expenses, net of reinsurance																																				$	1,613,425

Multi-line and other specialty ($000’s except claim count)
Incurred losses and allocated loss adjustment expenses, net of reinsurance																																																																		December 31, 2021
																																																																		Total of IBNR liabilities plus expected development on reported claims						Cumulative number of reported claims
						Year ended December 31,
Accident year						2012 unaudited						2013 unaudited						2014 unaudited						2015 unaudited						2016 unaudited						2017 unaudited						2018 unaudited						2019 unaudited						2020 unaudited						2021
2012						$	254,684					$	265,479					$	259,582					$	257,240					$	256,379					$	248,066					$	248,310					$	245,205					$	245,260					$	243,849					$	2,057					55,219
2013												266,089						274,285						265,594						265,672						253,554						254,916						250,252						247,443						246,682						3,461						71,613
2014																		303,053						327,098						319,706						319,418						318,297						314,300						311,097						310,097						5,770						109,575
2015																								335,250						358,587						357,364						365,362						357,123						349,895						347,669						7,201						148,924
2016																														409,367						431,760						428,579						416,724						410,610						408,621						11,032						175,261
2017																																				483,414						502,068						492,166						501,753						505,135						16,867						219,810
2018																																										513,466						565,717						563,969						566,283						32,467						247,052
2019																																																568,337						613,673						641,832						63,880						235,824
2020																																																						622,241						572,265						192,056						149,004
2021																																																												637,258						361,237						75,250
																																																						Total						$	4,479,691
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance
2012						$	78,523					$	166,414					$	190,754					$	209,916					$	223,798					$	232,640					$	233,862					$	237,221					$	240,191					$	239,928
2013												86,911						151,897						181,721						214,941						226,769						235,801						237,863						238,792						239,831
2014																		108,003						197,609						235,079						267,959						282,104						292,638						294,049						295,551
2015																								138,393						236,516						278,265						306,313						321,395						327,082						330,872
2016																														176,238						305,250						342,345						363,392						379,885						385,890
2017																																				181,454						343,049						381,419						424,219						446,749
2018																																										212,316						390,009						443,644						480,852
2019																																																212,629						386,894						488,094
2020																																																						173,123						311,112
2021																																																												157,346
																														Total																														3,376,225
																														All outstanding liabilities before 2012, net of reinsurance																														22,375
																								Liabilities for losses and loss adjustment expenses, net of reinsurance																																				$	1,125,841

The following table presents the average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance, as of December 31, 2021:

						Average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance
						Year 1						Year 2						Year 3						Year 4						Year 5						Year 6						Year 7						Year 8						Year 9						Year 10
Property, energy, marine and aviation						19.3		%				43.5		%				19.1		%				6.6		%				1.4		%				2.3		%				3.2		%				0.5		%				0.3		%				0.2		%
Third party occurrence business						3.3		%				9.3		%				11.6		%				11.0		%				9.8		%				8.7		%				5.4		%				4.1		%				3.5		%				2.1		%
Third party claims-made business						4.4		%				18.0		%				17.8		%				12.3		%				12.7		%				7.9		%				7.0		%				4.3		%				1.0		%				1.7		%
Multi-line and other specialty						34.7		%				29.5		%				11.0		%				8.6		%				4.6		%				2.8		%				0.7		%				0.7		%				0.8		%				(0.1)		%

Reinsurance Segment

Loss Reserves for the Company’s reinsurance segment are comprised of (1) case reserves, (2) additional case reserves (“ACRs”) and (3) IBNR reserves. The Company receives reports of claims notices from ceding companies and records case reserves based upon the amount of reserves recommended by the ceding company. Case reserves may be supplemented by ACRs, which may be estimated by the Company’s claims personnel ahead of official notification from the ceding company, or when judgment regarding the size or severity of the known event differs from the ceding company. In certain instances, the Company establishes ACRs even when the ceding company does not report any liability on a known event. In addition, specific claim information reported by ceding companies or obtained through claim audits can alert the Company to emerging trends such as changing legal interpretations of coverage and liability, claims from unexpected sources or classes of business, and significant changes in the frequency or severity of individual claims. Such information is often used in the process of estimating IBNR reserves. IBNR reserves are established to provide for incurred claims which have not yet been reported at the balance sheet date as well as to adjust for any projected variance in case reserving. Actuaries estimate ultimate losses and loss adjustment expenses using various generally accepted actuarial methods applied to known losses and other relevant information. Like case reserves, IBNR reserves are adjusted as additional information becomes known or payments are made. The process of estimating Loss Reserves involves a considerable degree of judgment by management and, as of any given date, is inherently uncertain.

The estimation of Loss Reserves for the reinsurance segment is subject to the same risk factors as the estimation of Loss Reserves for the insurance segment. In addition, the inherent uncertainties of estimating such reserves are even greater for reinsurers, due primarily to the following factors: (1) the claim-tail for reinsurers is generally longer because claims are first reported to the ceding company and then to the reinsurer through one or more intermediaries, (2) the reliance on premium estimates, where reports have not been received from the ceding company, in the reserving process, (3) the potential for writing a number of reinsurance contracts with different ceding companies with the same exposure to a single loss event, (4) the diversity of loss development

patterns among different types of reinsurance contracts, (5) the necessary reliance on the ceding companies for information regarding reported claims and (6) the differing reserving practices among ceding companies.

Ultimate losses and loss adjustment expenses are generally determined by projection of claim emergence and settlement patterns observed in the past that can reasonably be expected to persist into the future. As with the insurance segment, the process of estimating Loss Reserves for the reinsurance segment involves a considerable degree of judgment by management and, as of any given date, is inherently uncertain. As discussed above, such uncertainty is greater for reinsurers compared to insurers. As a result, our reinsurance operations obtain information from numerous sources to assist in the process. Pricing actuaries from the reinsurance segment devote considerable effort to understanding and analyzing a ceding company’s operations and loss history during the underwriting of the business, using a combination of ceding company and industry statistics. Such statistics normally include historical premium and loss data by class of business, individual claim information for larger claims, distributions of insurance limits provided, loss reporting and payment patterns, and rate change history. This analysis is used to project expected loss ratios for each treaty during the upcoming contract period.

As mentioned above, there can be a considerable time lag from the time a claim is reported to a ceding company to the time it is reported to the reinsurer. The lag can be several years in some cases and may be attributed to a number of reasons, including the time it takes to investigate a claim, delays associated with the litigation process, the deterioration in a claimant’s physical condition many years after an accident occurs, the case reserving approach of the ceding company, etc. In the reserving process, the Company assumes that such lags are predictable, on average, over time and therefore the lags are contemplated in the loss reporting patterns used in their actuarial methods. This means that the reinsurance segment must rely on estimates for a longer period of time than does an insurance company. Backlogs in the recording of assumed reinsurance can also complicate the accuracy of loss reserve estimation. As of December 31, 2021 there were no significant backlogs related to the processing of assumed reinsurance information at our reinsurance operations.

The reinsurance segment relies heavily on information reported by ceding companies, as discussed above. In order to determine the accuracy and completeness of such information, underwriters, actuaries, and claims personnel often perform audits of ceding companies and regularly review information received from ceding companies for unusual or unexpected results. Material findings are usually discussed with the ceding companies. The Company sometimes encounters situations where they determine that a claim presentation from a ceding company is not in accordance with contract terms. In these situations, the Company attempts to resolve the dispute with the ceding company. Most situations are resolved amicably and without the need for litigation or arbitration. However, in the infrequent situations where a resolution is not possible, the Company will vigorously defend its position in such disputes.

Although Loss Reserves are initially determined based on underwriting and pricing analysis, the Company applies several generally accepted actuarial methods, as discussed above, on a quarterly basis to evaluate its Loss Reserves in addition to the expected loss method, in particular for reserves from more mature underwriting years (the year in which business is underwritten). Each quarter, as part of the reserving process, the Company’s actuaries reaffirm that the assumptions used in the reserving process continue to form a sound basis for projection of liabilities. If actual loss activity differs substantially from expectations based on historical information, an adjustment to Loss Reserves may be supported. Estimated Loss Reserves for more mature underwriting years are now based more on actual loss activity and historical patterns than on the initial assumptions based on pricing indications. More recent underwriting years rely more heavily on internal pricing assumptions. The Company places more or less reliance on a particular actuarial method based on the facts and circumstances at the time the estimates of Loss Reserves are made.

In the initial reserving process for short-tail reinsurance lines (consisting of property excluding property catastrophe and property catastrophe exposures), the Company relies on a combination of the reserving methods discussed above. For known catastrophic events, the reserving process also includes the usage of catastrophe models and a heavy reliance on analysis which includes ceding company inquiries and management judgment. The development of property losses may be unstable, especially where there is high catastrophic exposure, may be characterized by high severity, low frequency losses for excess and catastrophe-exposed business and may be highly correlated across contracts. As time passes, for a given underwriting year, additional weight is given to the paid and incurred B-F loss development methods and historical paid and incurred loss development

methods in the reserving process. The Company makes a number of key assumptions in reserving for short-tail lines, including that historical paid and reported development patterns are stable, catastrophe models provide useful information about our exposure to catastrophic events that have occurred and our underwriters’ judgment and guidance received from ceding companies as to potential loss exposures may be relied on. The expected loss ratios used in the initial reserving process for property exposures have varied over time due to changes in pricing, reinsurance structure, estimates of catastrophe losses, terms and conditions and geographical distribution. As losses in property lines are reported relatively quickly, expected loss ratios are selected for the current underwriting year incorporating the experience for earlier underwriting years, adjusted for rate changes, inflation, changes in reinsurance programs, expectations about present and future market conditions and expected attritional losses based on modeling. Due to the short-tail nature of property business, reported loss experience emerges quickly and ultimate losses are known in a reasonably short period of time.

In the initial reserving process for medium-tail and long-tail reinsurance lines (consisting of casualty, other specialty, marine and aviation and other exposures), the Company primarily relies on the expected loss method. The development of medium-tail and long-tail business may be unstable, especially if there are high severity major events, with business written on an excess of loss basis typically having a longer tail than business written on a pro rata basis. As time passes, for a given underwriting year, additional weight is given to the paid and incurred B-F loss development methods and eventually to the historical paid and incurred loss development methods in the reserving process. Our reinsurance operations make a number of key assumptions in reserving for medium-tail and long-tail lines, including that the pricing loss ratio is the best estimate of the ultimate loss ratio at the time the contract is entered into, historical paid and reported development patterns are stable and claims personnel and underwriters’ analyses of our exposure to major events are our best estimate of our exposure to the known claims on those events. The expected loss ratios used in our reinsurance operations’ initial reserving process for medium-tail and long-tail contracts have varied over time due to changes in pricing, terms and conditions and reinsurance structure. As the credibility of historical experience for earlier underwriting years increases, the experience from these underwriting years is used in the actuarial analysis to determine future underwriting year expected loss ratios, adjusted for changes in pricing, loss trends, terms and conditions and reinsurance structure.

The following tables present information on the reinsurance segment’s short-duration insurance contracts:

Casualty ($000’s)
Incurred losses and allocated loss adjustment expenses, net of reinsurance																																																																		December 31, 2021
																																																																		Total of IBNR liabilities plus expected development on reported claims						Cumulative number of reported claims
						Year ended December 31,
Accident year						2012 unaudited						2013 unaudited						2014 unaudited						2015 unaudited						2016 unaudited						2017 unaudited						2018 unaudited						2019 unaudited						2020 unaudited						2021
2012						$	143,029					$	141,202					$	137,049					$	125,104					$	115,131					$	109,788					$	118,457					$	121,721					$	120,260					$	119,222					$	24,441					N/A
2013												166,016						159,257						155,066						148,784						136,717						135,155						131,475						135,762						135,959						30,873						N/A
2014																		216,882						222,109						219,355						233,552						230,019						239,765						240,067						236,378						41,077						N/A
2015																								223,208						221,922						230,830						238,126						242,180						249,029						252,809						57,345						N/A
2016																														215,222						227,534						251,415						266,254						273,266						272,689						54,087						N/A
2017																																				270,728						257,088						273,166						301,616						313,605						66,450						N/A
2018																																										281,141						294,820						285,646						290,955						66,572						N/A
2019																																																336,062						348,015						374,002						120,045						N/A
2020																																																						386,684						374,912						234,251						N/A
2021																																																												445,047						392,885						N/A
																																																						Total						$	2,815,578
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance
2012						$	1,306					$	8,486					$	14,690					$	25,523					$	36,562					$	47,807					$	59,511					$	69,877					$	75,833					$	79,364
2013												2,480						9,930						23,044						43,069						54,567						63,136						70,803						76,703						81,856
2014																		3,920						16,061						40,804						63,441						91,098						114,456						134,529						145,376
2015																								4,463						20,275						47,288						71,098						96,835						120,566						138,035
2016																														5,739						25,649						51,684						86,798						113,835						132,814
2017																																				6,429						30,360						64,075						113,307						137,921
2018																																										7,580						31,218						106,571						129,196
2019																																																15,815						57,643						96,935
2020																																																						17,730						50,603
2021																																																												14,794
																														Total																														1,006,894
																														All outstanding liabilities before 2012, net of reinsurance																														297,823
																								Liabilities for losses and loss adjustment expenses, net of reinsurance																																				$	2,106,507

Property catastrophe ($000’s)
Incurred losses and allocated loss adjustment expenses, net of reinsurance																																																																		December 31, 2021
																																																																		Total of IBNR liabilities plus expected development on reported claims						Cumulative number of reported claims
						Year ended December 31,
Accident year						2012 unaudited						2013 unaudited						2014 unaudited						2015 unaudited						2016 unaudited						2017 unaudited						2018 unaudited						2019 unaudited						2020 unaudited						2021
2012						$	149,957					$	122,942					$	108,590					$	102,114					$	99,885					$	99,071					$	97,037					$	97,145					$	96,531					$	96,447					$	105					N/A
2013												67,257						47,780						36,401						31,902						29,345						28,617						27,727						27,865						27,657						(138)						N/A
2014																		45,159						30,877						25,296						22,412						20,652						19,945						19,841						19,615						(10)						N/A
2015																								33,579						18,075						11,580						5,585						3,775						3,130						2,920						67						N/A
2016																														25,641						18,719						14,575						10,772						8,362						7,426						881						N/A
2017																																				87,504						54,768						50,553						36,846						25,121						(712)						N/A
2018																																										77,868						60,418						41,642						27,657						4,783						N/A
2019																																																38,570						24,808						23,534						4,576						N/A
2020																																																						267,750						334,185						40,561						N/A
2021																																																												316,197						61,821						N/A
																																																						Total						$	880,759
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance
2012						$	25,850					$	70,832					$	83,822					$	90,727					$	92,886					$	94,015					$	94,625					$	95,312					$	95,414					$	95,606
2013												12,200						19,201						24,038						25,894						27,652						27,891						27,892						28,597						28,346
2014																		13,622						19,939						18,402						19,231						18,821						19,013						19,154						19,241
2015																								(3,152)						(2,518)						1,786						2,050						1,616						1,705						1,781
2016																														(6,722)						2,521						2,796						4,082						3,312						3,668
2017																																				30,704						32,228						37,791						27,797						14,969
2018																																										27,497						12,506						24,259						(4,612)
2019																																																3,834						12,680						18,134
2020																																																						53,275						155,063
2021																																																												64,764
																														Total																														396,960
																														All outstanding liabilities before 2012, net of reinsurance																														2,449
																								Liabilities for losses and loss adjustment expenses, net of reinsurance																																				$	486,248

Property excluding property catastrophe ($000’s)
Incurred losses and allocated loss adjustment expenses, net of reinsurance																																																																		December 31, 2021
																																																																		Total of IBNR liabilities plus expected development on reported claims						Cumulative number of reported claims
						Year ended December 31,
Accident year						2012 unaudited						2013 unaudited						2014 unaudited						2015 unaudited						2016 unaudited						2017 unaudited						2018 unaudited						2019 unaudited						2020 unaudited						2021
2012						$	156,162					$	121,808					$	123,689					$	119,124					$	114,699					$	112,477					$	111,001					$	108,436					$	102,994					$	103,367					$	508					N/A
2013												115,473						76,905						70,558						66,208						64,486						63,702						62,504						63,269						62,782						384						N/A
2014																		143,464						117,448						99,328						90,710						88,438						84,130						82,408						80,940						923						N/A
2015																								215,095						189,109						184,774						189,045						188,343						177,281						173,659						8,482						N/A
2016																														177,039						146,307						138,375						136,868						140,681						137,579						12,700						N/A
2017																																				271,713						253,859						240,749						233,153						216,358						13,045						N/A
2018																																										225,638						242,069						238,052						214,942						11,593						N/A
2019																																																216,653						206,997						196,840						17,777						N/A
2020																																																						371,752						343,078						51,075						N/A
2021																																																												552,066						255,343						N/A
																																																						Total						$	2,081,611
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance
2012						$	26,153					$	78,080					$	93,198					$	101,868					$	102,844					$	103,480					$	102,658					$	102,598					$	102,504					$	102,525
2013												25,993						42,737						49,816						52,997						53,796						55,676						61,183						62,113						62,139
2014																		23,496						62,800						71,692						76,634						78,274						78,657						78,567						78,268
2015																								75,622						119,237						149,814						160,848						166,025						159,675						159,925
2016																														33,400						95,616						99,428						104,984						112,838						115,102
2017																																				27,569						125,768						158,066						166,087						181,628
2018																																										30,047						108,863						153,944						169,054
2019																																																43,230						124,222						150,931
2020																																																						101,969						208,888
2021																																																												136,712
																														Total																														1,365,172
																														All outstanding liabilities before 2012, net of reinsurance																														7,595
																								Liabilities for losses and loss adjustment expenses, net of reinsurance																																				$	724,034

Marine and aviation ($000’s)
Incurred losses and allocated loss adjustment expenses, net of reinsurance																																																																		December 31, 2021
																																																																		Total of IBNR liabilities plus expected development on reported claims						Cumulative number of reported claims
						Year ended December 31,
Accident year						2012 unaudited						2013 unaudited						2014 unaudited						2015 unaudited						2016 unaudited						2017 unaudited						2018 unaudited						2019 unaudited						2020 unaudited						2021
2012						$	58,992					$	58,868					$	55,053					$	52,286					$	51,079					$	49,727					$	46,046					$	43,028					$	41,182					$	40,016					$	1,005					N/A
2013												38,881						37,668						36,653						35,251						35,157						34,415						33,970						30,316						27,605						2,394						N/A
2014																		30,958						29,159						27,373						25,674						23,677						23,310						22,031						21,984						4,909						N/A
2015																								33,646						37,505						31,790						31,736						30,789						28,464						27,680						3,867						N/A
2016																														27,351						22,747						23,567						19,273						16,969						15,019						6,708						N/A
2017																																				28,800						26,346						23,830						20,827						19,903						6,387						N/A
2018																																										28,017						26,084						24,615						24,756						6,452						N/A
2019																																																48,929						55,307						60,983						15,112						N/A
2020																																																						83,457						76,598						36,671						N/A
2021																																																												111,046						89,459						N/A
																																																						Total						$	425,590
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance
2012						$	2,658					$	11,433					$	27,528					$	33,313					$	35,055					$	36,257					$	37,746					$	38,038					$	38,131					$	38,116
2013												4,945						13,731						18,415						21,388						22,398						23,672						24,049						23,786						23,753
2014																		4,177						7,985						11,590						12,469						14,645						15,080						15,956						16,036
2015																								7						13,418						19,023						20,861						22,629						22,306						22,445
2016																														(7,333)						(1,687)						521						3,261						5,864						6,767
2017																																				1,660						6,541						9,367						11,030						11,632
2018																																										2,005						6,968						11,236						13,585
2019																																																10,756						21,580						29,068
2020																																																						9,220						26,519
2021																																																												8,643
																														Total																														196,564
																														All outstanding liabilities before 2012, net of reinsurance																														16,855
																								Liabilities for losses and loss adjustment expenses, net of reinsurance																																				$	245,881

Other specialty ($000’s)
Incurred losses and allocated loss adjustment expenses, net of reinsurance																																																																		December 31, 2021
																																																																		Total of IBNR liabilities plus expected development on reported claims						Cumulative number of reported claims
						Year ended December 31,
Accident year						2012 unaudited						2013 unaudited						2014 unaudited						2015 unaudited						2016 unaudited						2017 unaudited						2018 unaudited						2019 unaudited						2020 unaudited						2021
2012						$	222,558					$	211,839					$	202,046					$	196,138					$	193,882					$	196,539					$	194,726					$	189,193					$	181,246					$	179,364					$	2,392					N/A
2013												252,744						226,032						216,250						212,721						213,614						211,261						210,825						204,894						201,830						6,409						N/A
2014																		274,826						256,332						258,114						251,474						246,393						248,083						243,652						237,478						7,857						N/A
2015																								209,764						201,057						199,468						196,521						196,840						193,626						182,162						8,549						N/A
2016																														223,191						220,661						215,078						209,564						215,614						210,344						13,182						N/A
2017																																				269,254						258,419						247,203						245,505						241,598						30,855						N/A
2018																																										320,538						316,231						308,190						324,536						40,807						N/A
2019																																																360,854						341,409						326,168						51,165						N/A
2020																																																						533,861						460,084						102,130						N/A
2021																																																												582,446						300,667						N/A
																																																						Total						$	2,946,010
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance
2012						$	45,663					$	121,679					$	144,429					$	155,445					$	163,160					$	167,164					$	171,519					$	173,305					$	173,606					$	173,494
2013												57,317						119,445						145,521						161,608						171,189						176,483						183,772						184,111						186,956
2014																		68,869						146,652						182,184						195,433						201,974						212,991						215,597						219,060
2015																								54,359						114,382						138,350						145,419						154,369						162,314						164,471
2016																														65,055						138,648						162,661						174,403						186,247						189,411
2017																																				73,366						164,829						192,274						199,051						205,998
2018																																										71,167						201,732						231,358						245,330
2019																																																79,718						158,132						216,647
2020																																																						97,617						243,980
2021																																																												126,635
																														Total																														1,971,982
																														All outstanding liabilities before 2012, net of reinsurance																														7,777
																								Liabilities for losses and loss adjustment expenses, net of reinsurance																																				$	981,805

The following table presents the average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance, as of December 31, 2021:

						Average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance
						Year 1						Year 2						Year 3						Year 4						Year 5						Year 6						Year 7						Year 8						Year 9						Year 10
Casualty						2.5		%				7.3		%				11.6		%				11.3		%				9.6		%				8.4		%				7.7		%				5.9		%				4.4		%				3.0		%
Property catastrophe						21.6		%				30.0		%				32.8		%				(14.2)		%				(11.6)		%				2.2		%				1.0		%				1.2		%				(0.4)		%				0.2		%
Property excluding property catastrophe						26.7		%				38.9		%				13.3		%				5.8		%				3.4		%				0.4		%				2.0		%				0.4		%				—		%				—		%
Marine and aviation						4.9		%				26.9		%				19.0		%				10.3		%				7.4		%				2.9		%				2.4		%				—		%				0.1		%				—		%
Other specialty						26.3		%				34.2		%				12.9		%				5.2		%				4.2		%				3.1		%				2.1		%				0.9		%				0.8		%				(0.1)		%

Mortgage Segment

The Company’s mortgage segment includes (1) U.S. primary mortgage insurance (2) U.S. credit risk transfer and other, and (3) international mortgage insurance and reinsurance. The latter two categories along with second lien and student loan exposures are excluded on the basis of insignificance for the purposes of presenting disclosures related to short duration contracts.

For primary mortgage insurance business, the Company establishes case reserves for loans that have been reported as delinquent by loan servicers as well as those that are delinquent but not reported (IBNR reserves). The Company also reserves for the expenses of adjusting claims related to these delinquencies. The trigger that creates a case reserve estimate is that an insured loan is reported to us as being two payments in arrears. The actuarial reviews and documentation created in the reserving process are completed in accordance with generally accepted actuarial standards.

The selected assumptions reflect actuarial judgment based on the analysis of historical data and experience combined with information concerning current underwriting, economic, judicial, regulatory and other influences on ultimate claim settlements.

Because the reserving process requires the Company to forecast future conditions, it is inherently uncertain and requires significant judgment and estimation. The use of different estimates would result in the establishment of different reserve levels. Additionally, changes in estimates are likely to occur from period to period as economic conditions change, and the ultimate liability may vary significantly from the estimates used. Major risk factors include (but are not limited to) changes in home prices and borrower equity, which can limit the borrower’s ability to sell the property and satisfy the outstanding loan balance, and changes in unemployment, which can affect the borrower’s income and ability to make mortgage payments. The unique nature of the COVID-19 pandemic, with no historical

precedent, adds further uncertainty to current reserve estimates.

The lead actuarial methodology used by the Company is a frequency-severity method based on the inventory of pending delinquencies. Each month the loan servicers report the delinquency status of each insured loan. Using the frequency-severity method allows the Company to take advantage of its knowledge of the number of delinquent loans and the coverage provided (“risk size”) on those loans by directly relating the reserves to these amounts. The delinquencies are grouped into homogeneous cohorts for analysis, reflecting product type and age of delinquency. A claim rate is then developed for each cohort which represents the frequency with which the delinquencies become claims. The claim frequency rates are based on an analysis of the patterns of emerging cure counts and claim counts, the foreclosure status of the pending delinquencies, the product and geographical mix of the delinquencies and our view of future economic and claim conditions, which include trends in home prices and unemployment. Claim rates can vary materially by age of delinquency, depending on the mix of delinquencies and economic conditions.

Claim size severity estimates are determined by examining the risk sizes on the delinquent loans and estimating the portion of risk that will be paid, as well as any expenses. This is done based on a review of historical development patterns, an assessment of economic conditions and the level of equity the borrowers may have in their homes, as well as considering economic conditions and loss mitigation opportunities. Mortgage insurance is generally not subject to large claim sizes, as with some other lines of insurance. A claim size over $250,000 is rare, and this helps reduce the volatility of claim size estimates.

The claim rate and claim size assumptions generate case reserves for the population of reported delinquencies. The reserve for unreported delinquencies (included in IBNR reserves) is estimated by looking at historical patterns of reporting. Claim rates and claim sizes can then be assigned to estimated unreported delinquencies using assumptions made in the establishment of case reserves.

Mortgage insurance Loss Reserves are short-tail, in the sense that the vast majority of delinquencies are resolved within two years of being reported. Due to the forbearances and foreclosure moratoriums associated with COVID-19, settlement timelines may be extended. While reserves are initially analyzed by reserve cohort, as described above, they are also rolled up by underwriting year to ensure that reserve assumptions are consistent with the performance of the underwriting year. The accuracy of prior reserve assumptions is also checked in hindsight to determine if adjustments to the assumptions are needed.

Loss Reserves for the Company’s mortgage reinsurance business and GSE credit risk sharing transactions are comprised of case reserves and IBNR reserves. The Company’s mortgage reinsurance operations receive reports of delinquent loans and claims notices from ceding companies and record case reserves based upon the amount of reserves recommended by the ceding company. In addition, specific claim and delinquency information reported by ceding companies is used in the process of estimating IBNR reserves.

The following table presents information on the mortgage segment’s short-duration insurance contracts:

U.S. primary mortgage insurance ($000’s except claim count)
Incurred losses and allocated loss adjustment expenses, net of reinsurance																																																																		December 31, 2021
																																																																					Total of IBNR liabilities plus expected development on reported claims						Cumulative number of paid claims
Year ended December 31,
Accident year						2012 unaudited						2013 unaudited						2014 unaudited						2015 unaudited						2016 unaudited						2017 unaudited						2018 unaudited						2019 unaudited									2020 unaudited						2021
2012						$	520,835					$	480,592					$	475,317					$	469,238					$	467,296					$	459,467					$	458,065					$	456,286								$	456,331					$	456,362					1						15,080
2013												469,311						419,668						411,793						405,809						395,693						393,149						390,987									391,062						391,324						1						9,468
2014																		316,095						297,151						279,434						266,027						265,992						261,091									262,682						262,829						4						6,299
2015																								222,790						197,238						198,001						194,677						189,235									190,913						190,560						1						4,554
2016																														183,556						170,532						148,715						140,608									142,392						141,657						1						3,424
2017																																				179,376						132,220						107,255									108,181						109,242						1						2,474
2018																																										132,318						96,357									89,120						87,962						60						1,635
2019																																																108,424									119,253						110,362						181						851
2020																																																									420,003						373,533						2,686						189
2021																																																															144,375						2,246						11
																																																Total															$	2,268,206
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance
2012						(106,065)						186,605						327,605						395,695						426,024						441,577						448,151						452,348									453,587						453,986
2013												41,447						203,957						308,956						353,189						373,909						382,200						386,853									387,894						387,879
2014																		20,099						129,159						201,925						233,879						247,038						254,175									256,285						256,875
2015																								16,159						92,431						151,222						171,337						180,321									183,472						184,025
2016																														11,462						72,201						113,357						127,286									131,161						131,717
2017																																				8,622						48,112						78,650									87,317						89,756
2018																																										3,966						31,478									50,135						55,853
2019																																																2,899									20,105						29,102
2020																																																									1,040						4,144
2021																																																															469
																																																															1,593,806
																														All outstanding liabilities before 2012, net of reinsurance																														14,288
																								Liabilities for losses and loss adjustment expenses, net of reinsurance																																				$	688,688

The following table presents the average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance, as of December 31, 2021:

Average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance
						Year 1						Year 2						Year 3						Year 4						Year 5						Year 6						Year 7						Year 8						Year 9						Year 10
U.S. Primary						2.7		%				34.9		%				25.3		%				10.5		%				4.4		%				2.1		%				0.9		%				0.5		%				0.1		%				0.1		%

The following table represents a reconciliation of the disclosures of net incurred and paid loss development tables to the reserve for losses and loss adjustment expenses at December 31, 2021:

			December 31, 2021
Net outstanding liabilities
Insurance
Property, energy, marine and aviation			$	586,885
Third party occurrence business			2,885,557
Third party claims-made business			1,613,425
Multi-line and other specialty			1,125,841
Reinsurance
Casualty			2,106,507
Property catastrophe			486,248
Property excluding property catastrophe			724,034
Marine and aviation			245,881
Other specialty			981,805
Mortgage
U.S. primary			688,688
Other short duration lines not included in disclosures			441,459
Total for short duration lines			11,886,330
Unpaid losses and loss adjustment expenses recoverable
Insurance
Property, energy, marine and aviation			354,432
Third party occurrence business			1,537,549
Third party claims-made business			921,086
Multi-line and other specialty			199,485
Reinsurance
Casualty			592,879
Property catastrophe			484,598
Property excluding property catastrophe			118,939
Marine and aviation			111,298
Other specialty			373,292
Mortgage
U.S. primary			48,259
Other short duration lines not included in disclosures (1)			887,457
Intercompany eliminations			(4,146)
Total for short duration lines			5,625,128
Lines other than short duration			76,240
Discounting			(55,575)
Unallocated claims adjustment expenses			225,033
			245,698
Total gross reserves for losses and loss adjustment expenses			$	17,757,156

(1)    Includes unpaid loss and loss adjustment expenses recoverable of $390.1 million related to the loss portfolio transfer reinsurance agreements.

X

- Definition

Short Duration Contracts Disclosure [Abstract]

+ References

No definition available.

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X

- Definition

The entire disclosure for insurance products considered to be short-duration contracts because the contract provides insurance protection for a fixed period of short duration and enables the insurer to cancel the contract or to adjust the provisions of the contract at the end of any contract period, such as adjusting the amount of premiums charged or coverage provided, and on contracts on which amounts are paid but insurance risk is not transferred.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-URI http://asc.fasb.org/topic&trid=2303980

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