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Segment Reporting Disclosures | 6 Months Ended
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Jun. 30, 2020
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] |
Segment Reporting Disclosures | Segment Reporting Disclosures The chief operating decision maker reviews the Company's ongoing underwriting operations on a global basis in the following two segments: Insurance and Reinsurance. In determining how to allocate resources and assess the performance of its underwriting results, management considers many factors, including the nature of the insurance product sold, the type of account written and the type of customer served. The Insurance segment includes all direct business and facultative placements written within the Company's underwriting operations. The Reinsurance segment includes all treaty reinsurance written within the Company's underwriting operations. All investing activities related to the Company's insurance operations are included in the Investing segment. The chief operating decision maker reviews and assesses Markel Ventures’ performance in the aggregate, as a single operating segment. The Markel Ventures segment primarily consists of controlling interests in a diverse portfolio of businesses that operate in various industries. The Company's other operations include the results of the Company's insurance-linked securities operations and program services business, as well as the results of its legal and professional consulting services. Other operations also include results for lines of business discontinued prior to, or in conjunction with, acquisitions, including development on asbestos and environmental loss reserves and results attributable to the run-off of life and annuity reinsurance business, which are monitored separately from the Company's ongoing underwriting operations. For purposes of segment reporting, none of these other operations are considered to be reportable segments. Segment profit for each of the Company's underwriting segments is measured by underwriting profit. The property and casualty insurance industry commonly defines underwriting profit as earned premiums net of losses and loss adjustment expenses and underwriting, acquisition and insurance expenses. Underwriting profit does not replace operating income or net income computed in accordance with U.S. GAAP as a measure of profitability. Underwriting profit or loss provides a basis for management to evaluate the Company's underwriting performance. Segment profit for the Investing segment is measured by net investment income and net investment gains. Segment profit for the Markel Ventures segment is measured by operating income. For management reporting purposes, the Company allocates assets to its underwriting operations and to its Investing and Markel Ventures segments and certain of its other operations, including its program services and insurance-linked securities operations. Underwriting assets include assets attributed to the Company's Insurance and Reinsurance segments, discontinued underwriting lines of business, as well as assets that are not specifically allocated to the Company's other operations. Underwriting and investing assets are not allocated to the Company's underwriting segments since the Company does not manage its assets by underwriting segment. The Company does not allocate capital expenditures for long-lived assets to either of its underwriting segments for management reporting purposes. a)The following tables summarize the Company's segment disclosures.
| Quarter Ended June 30, 2020 |  |  |  |  |  |  |  |  |  |
(dollars in thousands) | Insurance |  | Reinsurance |  | Investing |  | Markel Ventures (1) |  | Other (2) |  | Consolidated
Gross premium volume | $ | 1,553,436 |  |  | $ | 223,277 |  |  | $ | — |  |  | $ | — |  |  | $ | 596,479 |  |  | $ | 2,373,192 |
Net written premiums | 1,267,976 |  |  | 188,830 |  |  | — |  |  | — |  |  | (411) |  |  | 1,456,395 |
Earned premiums | 1,120,151 |  |  | 240,555 |  |  | — |  |  | — |  |  | (532) |  |  | 1,360,174 |
Losses and loss adjustment expenses: |  |  |  |  |  |  |  |  |  |  |
Current accident year | (730,201) |  |  | (147,163) |  |  | — |  |  | — |  |  | — |  |  | (877,364) |
Prior accident years | 151,205 |  |  | 12,280 |  |  | — |  |  | — |  |  | 663 |  |  | 164,148 |
Amortization of policy acquisition costs | (238,784) |  |  | (63,411) |  |  | — |  |  | — |  |  | — |  |  | (302,195) |
Other operating expenses | (167,298) |  |  | (17,506) |  |  | — |  |  | — |  |  | (2,363) |  |  | (187,167) |
Underwriting profit (loss) | 135,073 |  |  | 24,755 |  |  | — |  |  | — |  |  | (2,232) |  |  | 157,596 |
Net investment income | — |  |  | — |  |  | 95,561 |  |  | 54 |  |  | — |  |  | 95,615 |
Net investment gains | — |  |  | — |  |  | 911,243 |  |  | — |  |  | — |  |  | 911,243 |
Products revenues | — |  |  | — |  |  | — |  |  | 423,581 |  |  | — |  |  | 423,581 |
Services and other revenues | — |  |  | — |  |  | — |  |  | 254,504 |  |  | 86,898 |  |  | 341,402 |
Products expenses | — |  |  | — |  |  | — |  |  | (364,483) |  |  | — |  |  | (364,483) |
Services and other expenses | — |  |  | — |  |  | — |  |  | (222,656) |  |  | (62,284) |  |  | (284,940) |
Amortization of intangible assets (3) | — |  |  | — |  |  | — |  |  | (11,596) |  |  | (26,158) |  |  | (37,754) |
Segment profit (loss) | $ | 135,073 |  |  | $ | 24,755 |  |  | $ | 1,006,804 |  |  | $ | 79,404 |  |  | $ | (3,776) |  |  | $ | 1,242,260 |
Interest expense |  |  |  |  |  |  |  |  |  |  | (45,427) |
Net foreign exchange losses |  |  |  |  |  |  |  |  |  |  | (21,460) |
Income before income taxes |  |  |  |  |  |  |  |  |  |  | $ | 1,175,373 |
U.S. GAAP combined ratio (4) | 88 | % |  | 90 | % |  |  |  |  |  | NM | (5) | 88 | %
(1)Products expenses and services and other expenses for the Markel Ventures segment include depreciation expense of $14.3 million for the quarter ended June 30, 2020. (2)Other represents the total profit (loss) attributable to the Company's operations that are not included in a reportable segment as well as any amortization of intangible assets that is not allocated to a reportable segment. Amortization of intangible assets attributable to the Company's underwriting segments was $10.7 million for the quarter ended June 30, 2020, however, the Company does not allocate amortization of intangible assets between the Insurance and Reinsurance segments. (3)Segment profit for the Markel Ventures segment includes amortization of intangible assets attributable to Markel Ventures. Amortization of intangible assets is not allocated to the Company's Insurance and Reinsurance segments. (4)The U.S. GAAP combined ratio is a measure of underwriting performance and represents the relationship of incurred losses, loss adjustment expenses and underwriting, acquisition and insurance expenses to earned premiums. (5)NM - Ratio is not meaningful
| Quarter Ended June 30, 2019 |  |  |  |  |  |  |  |  |  |
(dollars in thousands) | Insurance |  | Reinsurance |  | Investing |  | Markel Ventures (1) |  | Other (2) |  | Consolidated
Gross premium volume | $ | 1,368,348 |  |  | $ | 223,381 |  |  | $ | — |  |  | $ | — |  |  | $ | 655,418 |  |  | $ | 2,247,147 |
Net written premiums | 1,126,170 |  |  | 178,802 |  |  | — |  |  | — |  |  | 666 |  |  | 1,305,638 |
Earned premiums | 991,269 |  |  | 207,728 |  |  | — |  |  | — |  |  | 464 |  |  | 1,199,461 |
Losses and loss adjustment expenses: |  |  |  |  |  |  |  |  |  |  |
Current accident year | (657,372) |  |  | (139,340) |  |  | — |  |  | — |  |  | — |  |  | (796,712) |
Prior accident years | 101,721 |  |  | 18,190 |  |  | — |  |  | — |  |  | (1,319) |  |  | 118,592 |
Amortization of policy acquisition costs | (208,609) |  |  | (54,456) |  |  | — |  |  | — |  |  | — |  |  | (263,065) |
Other operating expenses | (179,432) |  |  | (23,306) |  |  | — |  |  | — |  |  | 3,487 |  |  | (199,251) |
Underwriting profit | 47,577 |  |  | 8,816 |  |  | — |  |  | — |  |  | 2,632 |  |  | 59,025 |
Net investment income | — |  |  | — |  |  | 111,633 |  |  | 198 |  |  | — |  |  | 111,831 |
Net investment gains | — |  |  | — |  |  | 425,653 |  |  | — |  |  | — |  |  | 425,653 |
Products revenues | — |  |  | — |  |  | — |  |  | 501,676 |  |  | — |  |  | 501,676 |
Services and other revenues | — |  |  | — |  |  | — |  |  | 115,311 |  |  | 85,184 |  |  | 200,495 |
Products expenses | — |  |  | — |  |  | — |  |  | (425,138) |  |  | — |  |  | (425,138) |
Services and other expenses | — |  |  | — |  |  | — |  |  | (99,860) |  |  | (70,936) |  |  | (170,796) |
Amortization of intangible assets (3) | — |  |  | — |  |  | — |  |  | (10,510) |  |  | (25,790) |  |  | (36,300) |
Segment profit (loss) | $ | 47,577 |  |  | $ | 8,816 |  |  | $ | 537,286 |  |  | $ | 81,677 |  |  | $ | (8,910) |  |  | $ | 666,446 |
Interest expense |  |  |  |  |  |  |  |  |  |  | (41,267) |
Net foreign exchange gains |  |  |  |  |  |  |  |  |  |  | 25,015 |
Income before income taxes |  |  |  |  |  |  |  |  |  |  | $ | 650,194 |
U.S. GAAP combined ratio (4) | 95 | % |  | 96 | % |  |  |  |  |  | NM | (5) | 95 | %
(1)Products expenses and services and other expenses for the Markel Ventures segment include depreciation expense of $13.5 million for the quarter ended June 30, 2019. (2)Other represents the total profit (loss) attributable to the Company's operations that are not included in a reportable segment as well as any amortization of intangible assets that is not allocated to a reportable segment. Amortization of intangible assets attributable to the Company's underwriting segments was $9.8 million for the quarter ended June 30, 2019, however, the Company does not allocate amortization of intangible assets between the Insurance and Reinsurance segments. (3)Segment profit for the Markel Ventures segment includes amortization of intangible assets attributable to Markel Ventures. Amortization of intangible assets is not allocated to the Company's Insurance and Reinsurance segments. (4)The U.S. GAAP combined ratio is a measure of underwriting performance and represents the relationship of incurred losses, loss adjustment expenses and underwriting, acquisition and insurance expenses to earned premiums. (5)NM - Ratio is not meaningful
| Six Months Ended June 30, 2020 |  |  |  |  |  |  |  |  |  |
(dollars in thousands) | Insurance |  | Reinsurance |  | Investing |  | Markel Ventures (1) |  | Other (2) |  | Consolidated
Gross premium volume | $ | 2,968,147 |  |  | $ | 736,463 |  |  | $ | — |  |  | $ | — |  |  | $ | 991,406 |  |  | $ | 4,696,016 |
Net written premiums | 2,463,713 |  |  | 641,579 |  |  | — |  |  | — |  |  | (2,419) |  |  | 3,102,873 |
Earned premiums | 2,227,002 |  |  | 466,515 |  |  | — |  |  | — |  |  | (2,634) |  |  | 2,690,883 |
Losses and loss adjustment expenses: |  |  |  |  |  |  |  |  |  |  |
Current accident year | (1,736,836) |  |  | (320,893) |  |  | — |  |  | — |  |  | — |  |  | (2,057,729) |
Prior accident years | 267,337 |  |  | (1,632) |  |  | — |  |  | — |  |  | 2,460 |  |  | 268,165 |
Amortization of policy acquisition costs | (478,204) |  |  | (119,802) |  |  | — |  |  | — |  |  | — |  |  | (598,006) |
Other operating expenses | (350,600) |  |  | (33,392) |  |  | — |  |  | — |  |  | (2,527) |  |  | (386,519) |
Underwriting loss | (71,301) |  |  | (9,204) |  |  | — |  |  | — |  |  | (2,701) |  |  | (83,206) |
Net investment income | — |  |  | — |  |  | 183,620 |  |  | 238 |  |  | — |  |  | 183,858 |
Net investment losses | — |  |  | — |  |  | (770,198) |  |  | — |  |  | — |  |  | (770,198) |
Products revenues | — |  |  | — |  |  | — |  |  | 775,742 |  |  | — |  |  | 775,742 |
Services and other revenues | — |  |  | — |  |  | — |  |  | 413,380 |  |  | 174,016 |  |  | 587,396 |
Products expenses | — |  |  | — |  |  | — |  |  | (678,554) |  |  | — |  |  | (678,554) |
Services and other expenses | — |  |  | — |  |  | — |  |  | (366,208) |  |  | (136,288) |  |  | (502,496) |
Amortization of intangible assets (3) | — |  |  | — |  |  | — |  |  | (23,437) |  |  | (52,175) |  |  | (75,612) |
Segment profit (loss) | $ | (71,301) |  |  | $ | (9,204) |  |  | $ | (586,578) |  |  | $ | 121,161 |  |  | $ | (17,148) |  |  | $ | (563,070) |
Interest expense |  |  |  |  |  |  |  |  |  |  | (90,457) |
Net foreign exchange gains |  |  |  |  |  |  |  |  |  |  | 56,841 |
Loss before income taxes |  |  |  |  |  |  |  |  |  |  | $ | (596,686) |
U.S. GAAP combined ratio (4) | 103 | % |  | 102 | % |  |  |  |  |  | NM | (5) | 103 | %
(1)Products expenses and services and other expenses for the Markel Ventures segment include depreciation expense of $28.1 million for the six months ended June 30, 2020. (2)Other represents the total profit (loss) attributable to the Company's operations that are not included in a reportable segment as well as any amortization of intangible assets that is not allocated to a reportable segment. Amortization of intangible assets attributable to the Company's underwriting segments was $21.1 million for the six months ended June 30, 2020, however, the Company does not allocate amortization of intangible assets between the Insurance and Reinsurance segments. (3)Segment profit for the Markel Ventures segment includes amortization of intangible assets attributable to Markel Ventures. Amortization of intangible assets is not allocated to the Company's Insurance and Reinsurance segments. (4)The U.S. GAAP combined ratio is a measure of underwriting performance and represents the relationship of incurred losses, loss adjustment expenses and underwriting, acquisition and insurance expenses to earned premiums. (5)NM - Ratio is not meaningful
| Six Months Ended June 30, 2019 |  |  |  |  |  |  |  |  |  |
(dollars in thousands) | Insurance |  | Reinsurance |  | Investing |  | Markel Ventures (1) |  | Other (2) |  | Consolidated
Gross premium volume | $ | 2,561,196 |  |  | $ | 736,758 |  |  | $ | — |  |  | $ | — |  |  | $ | 1,204,235 |  |  | $ | 4,502,189 |
Net written premiums | 2,124,528 |  |  | 657,769 |  |  | — |  |  | — |  |  | 434 |  |  | 2,782,731 |
Earned premiums | 1,964,996 |  |  | 438,238 |  |  | — |  |  | — |  |  | 204 |  |  | 2,403,438 |
Losses and loss adjustment expenses: |  |  |  |  |  |  |  |  |  |  |
Current accident year | (1,275,870) |  |  | (278,812) |  |  | — |  |  | — |  |  | — |  |  | (1,554,682) |
Prior accident years | 174,295 |  |  | 6,895 |  |  | — |  |  | — |  |  | 7,626 |  |  | 188,816 |
Amortization of policy acquisition costs | (408,608) |  |  | (116,284) |  |  | — |  |  | — |  |  | — |  |  | (524,892) |
Other operating expenses | (355,153) |  |  | (37,865) |  |  | — |  |  | — |  |  | 382 |  |  | (392,636) |
Underwriting profit | 99,660 |  |  | 12,172 |  |  | — |  |  | — |  |  | 8,212 |  |  | 120,044 |
Net investment income | — |  |  | — |  |  | 225,563 |  |  | 450 |  |  | — |  |  | 226,013 |
Net investment gains | — |  |  | — |  |  | 1,037,844 |  |  | — |  |  | — |  |  | 1,037,844 |
Products revenues | — |  |  | — |  |  | — |  |  | 850,470 |  |  | — |  |  | 850,470 |
Services and other revenues | — |  |  | — |  |  | — |  |  | 221,280 |  |  | 172,559 |  |  | 393,839 |
Products expenses | — |  |  | — |  |  | — |  |  | (744,564) |  |  | — |  |  | (744,564) |
Services and other expenses | — |  |  | — |  |  | — |  |  | (194,730) |  |  | (150,672) |  |  | (345,402) |
Amortization of intangible assets (3) | — |  |  | — |  |  | — |  |  | (21,317) |  |  | (55,651) |  |  | (76,968) |
Segment profit (loss) | $ | 99,660 |  |  | $ | 12,172 |  |  | $ | 1,263,407 |  |  | $ | 111,589 |  |  | $ | (25,552) |  |  | $ | 1,461,276 |
Interest expense |  |  |  |  |  |  |  |  |  |  | (81,557) |
Net foreign exchange gains |  |  |  |  |  |  |  |  |  |  | 3,151 |
Income before income taxes |  |  |  |  |  |  |  |  |  |  | $ | 1,382,870 |
U.S. GAAP combined ratio (4) | 95 | % |  | 97 | % |  |  |  |  |  | NM | (5) | 95 | %
(1)Products expenses and services and other expenses for the Markel Ventures segment include depreciation expense of $27.5 million for the six months ended June 30, 2019. (2)Other represents the total profit (loss) attributable to the Company's operations that are not included in a reportable segment as well as any amortization of intangible assets that is not allocated to a reportable segment. Amortization of intangible assets attributable to the Company's underwriting segments was $19.7 million for the six months ended June 30, 2019, however, the Company does not allocate amortization of intangible assets between the Insurance and Reinsurance segments. (3)Segment profit for the Markel Ventures segment includes amortization of intangible assets attributable to Markel Ventures. Amortization of intangible assets is not allocated to the Company's Insurance and Reinsurance segments. (4)The U.S. GAAP combined ratio is a measure of underwriting performance and represents the relationship of incurred losses, loss adjustment expenses and underwriting, acquisition and insurance expenses to earned premiums. (5)NM - Ratio is not meaningful b)The following table reconciles segment assets to the Company's consolidated balance sheets.
(dollars in thousands) | June 30, 2020 |  | December 31, 2019
Segment assets: |  |  |
Investing | $ | 22,097,531 |  |  | $ | 22,129,633 |
Underwriting | 7,229,312 |  |  | 6,621,639 |
Markel Ventures | 3,741,583 |  |  | 2,550,835 |
Total segment assets | 33,068,426 |  |  | 31,302,107 |
Other operations | 5,999,200 |  |  | 6,171,708 |
Total assets | $ | 39,067,626 |  |  | $ | 37,473,815 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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