v3.2.0.727
Reinsurance
 6 Months Ended
Jun. 30, 2015
Reinsurance Disclosures [Abstract]  
Reinsurance
Reinsurance

The following tables summarize the effect of reinsurance and retrocessional reinsurance on premiums written and earned.
 
Quarter Ended June 30,
 
2015
 
2014
(dollars in thousands)
Written
 
Earned
 
Written
 
Earned
Direct
$
951,885

 
$
875,376

 
$
976,446

 
$
852,867

Assumed
313,901

 
304,324

 
366,932

 
336,617

Ceded
(231,442
)
 
(222,143
)
 
(259,047
)
 
(223,885
)
Net premiums
$
1,034,344

 
$
957,557

 
$
1,084,331

 
$
965,599

 
Six Months Ended June 30,
 
2015
 
2014
(dollars in thousands)
Written
 
Earned
 
Written
 
Earned
Direct
$
1,753,465

 
$
1,719,946

 
$
1,771,757

 
$
1,681,159

Assumed
764,794

 
617,159

 
931,378

 
684,316

Ceded
(448,485
)
 
(435,898
)
 
(479,493
)
 
(450,501
)
Net premiums
$
2,069,774

 
$
1,901,207

 
$
2,223,642

 
$
1,914,974



The percentage of ceded earned premiums to gross earned premiums was 19% for the quarters and six months ended June 30, 2015 and 2014. The percentage of assumed earned premiums to net earned premiums was 32% and 35%, respectively for the quarters ended June 30, 2015 and 2014 and 32% and 36%, respectively, for the six months ended June 30, 2015 and 2014.

Incurred losses and loss adjustment expenses were net of reinsurance recoverables (ceded incurred losses and loss adjustment expenses) of $143.3 million and $141.3 million, respectively, for the quarters ended June 30, 2015 and 2014 and $232.1 million and $238.9 million, respectively, for the six months ended June 30, 2015 and 2014.

On March 9, 2015, the Company completed a retrospective reinsurance transaction to cede a portfolio of policies comprised of liabilities arising from asbestos and environmental exposures that originated before 1992 in exchange for payments totaling $89.0 million, which included cash paid at closing of $69.9 million. At the time of the transaction, reserves for unpaid losses and loss adjustment expenses on the policies ceded totaled $94.1 million, resulting in a deferred gain of $5.1 million which will be recognized in earnings in future periods in proportion to actual reinsurance recoveries received pursuant to the transaction. The ceded reserves represented approximately 35% of our net asbestos and environmental reserves for losses and loss adjustment expenses as of December 31, 2014.