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Reinsurance | 6 Months Ended
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Jun. 30, 2020
Reinsurance Disclosures [Abstract] |
Reinsurance | Reinsurance The following table summarizes the effect of reinsurance and retrocessional reinsurance on premiums written and earned.
| Quarter Ended June 30, |  |  |  |  |  |  |  |  |  |  |  |  |  |
| 2020 |  |  |  |  |  |  |  | 2019 |  |  |  |  |  |
(dollars in thousands) | Direct |  | Assumed |  | Ceded |  | Net Premiums |  | Direct |  | Assumed |  | Ceded |  | Net Premiums
Underwriting: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Written | $ | 1,460,090 |  |  | $ | 316,905 |  |  | $ | (319,772) |  |  | $ | 1,457,223 |  |  | $ | 1,323,128 |  |  | $ | 268,837 |  |  | $ | (286,978) |  |  | $ | 1,304,987 |
Earned | 1,287,268 |  |  | 346,262 |  |  | (272,600) |  |  | 1,360,930 |  |  | 1,159,544 |  |  | 331,842 |  |  | (292,374) |  |  | 1,199,012 |
Program services and other: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Written | 567,864 |  |  | 28,333 |  |  | (597,025) |  |  | (828) |  |  | 652,716 |  |  | 2,466 |  |  | (654,531) |  |  | 651 |
Earned | 498,381 |  |  | 26,588 |  |  | (525,725) |  |  | (756) |  |  | 538,131 |  |  | 12,878 |  |  | (550,560) |  |  | 449 |
Consolidated: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Written | 2,027,954 |  |  | 345,238 |  |  | (916,797) |  |  | 1,456,395 |  |  | 1,975,844 |  |  | 271,303 |  |  | (941,509) |  |  | 1,305,638 |
Earned | $ | 1,785,649 |  |  | $ | 372,850 |  |  | $ | (798,325) |  |  | $ | 1,360,174 |  |  | $ | 1,697,675 |  |  | $ | 344,720 |  |  | $ | (842,934) |  |  | $ | 1,199,461 |
| Six Months Ended June 30, |  |  |  |  |  |  |  |  |  |  |  |  |  |
| 2020 |  |  |  |  |  |  |  | 2019 |  |  |  |  |  |
(dollars in thousands) | Direct |  | Assumed |  | Ceded |  | Net Premiums |  | Direct |  | Assumed |  | Ceded |  | Net Premiums
Underwriting: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Written | $ | 2,809,331 |  |  | $ | 895,561 |  |  | $ | (599,161) |  |  | $ | 3,105,731 |  |  | $ | 2,450,516 |  |  | $ | 846,934 |  |  | $ | (515,610) |  |  | $ | 2,781,840 |
Earned | 2,562,939 |  |  | 672,962 |  |  | (542,138) |  |  | 2,693,763 |  |  | 2,291,100 |  |  | 619,217 |  |  | (507,540) |  |  | 2,402,777 |
Program services and other: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Written | 956,788 |  |  | 34,336 |  |  | (993,982) |  |  | (2,858) |  |  | 1,170,417 |  |  | 34,322 |  |  | (1,203,848) |  |  | 891 |
Earned | 1,043,724 |  |  | 40,311 |  |  | (1,086,915) |  |  | (2,880) |  |  | 1,053,083 |  |  | 29,273 |  |  | (1,081,695) |  |  | 661 |
Consolidated: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Written | 3,766,119 |  |  | 929,897 |  |  | (1,593,143) |  |  | 3,102,873 |  |  | 3,620,933 |  |  | 881,256 |  |  | (1,719,458) |  |  | 2,782,731 |
Earned | $ | 3,606,663 |  |  | $ | 713,273 |  |  | $ | (1,629,053) |  |  | $ | 2,690,883 |  |  | $ | 3,344,183 |  |  | $ | 648,490 |  |  | $ | (1,589,235) |  |  | $ | 2,403,438 |
Substantially all of the premiums written and earned in the Company's program services and other fronting operations for the quarter and six months ended June 30, 2020 and 2019 were ceded. The percentage of consolidated ceded earned premiums to gross earned premiums was 37% and 38% for the quarter and six months ended June 30, 2020, respectively, and 41% and 40% for the quarter and six months ended June 30, 2019, respectively. The percentage of consolidated assumed earned premiums to net earned premiums was 27% for both the quarter and six months ended June 30, 2020 and 29% and 27% for the quarter and six months ended June 30, 2019, respectively. Substantially all of the incurred losses and loss adjustment expenses in the Company's program services and other fronting operations, which totaled $394.5 million and $702.5 million for the quarter and six months ended June 30, 2020, respectively, and $338.8 million and $703.8 million for the quarter and six months ended June 30, 2019, respectively, were ceded. The following table summarizes the effect of reinsurance and retrocessional reinsurance on losses and loss adjustment expenses in the Company's underwriting operations.
| Quarter Ended June 30, |  |  |  | Six Months Ended June 30, |  |
(dollars in thousands) | 2020 |  | 2019 |  | 2020 |  | 2019
Gross | $ | 868,069 |  |  | $ | 893,276 |  |  | $ | 2,111,626 |  |  | $ | 1,715,030 |
Ceded | (154,307) |  |  | (215,389) |  |  | (321,487) |  |  | (349,412) |
Net losses and loss adjustment expenses | $ | 713,762 |  |  | $ | 677,887 |  |  | $ | 1,790,139 |  |  | $ | 1,365,618 |
The following table presents the Company's reinsurance recoverables and the related allowance for credit losses.
(dollars in thousands) | June 30, 2020 |  | December 31, 2019
Reinsurance recoverables, gross | $ | 5,505,162 |  |  | $ | 5,459,561 |
Allowance for credit losses | (32,813) |  |  | (26,849) |
Reinsurance recoverables | $ | 5,472,349 |  |  | $ | 5,432,712 |
Following the adoption of ASC 326, as described in note 1, beginning January 1, 2020 the Company considers reasonable and supportable forecasts of future economic conditions in addition to information about past events and current conditions to determine the allowance for credit losses. The increase in the allowance for credit losses on reinsurance recoverables from December 31, 2019 to June 30, 2020 reflects the impact of adopting this standard effective January 1, 2020 as well as a decline in short-term economic conditions as forecasted during the first six months of 2020 as a result of expected impacts from the COVID-19 pandemic.

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- Definition The entire disclosure pertaining to the existence, magnitude and information about insurance that has been ceded to or assumed from another insurance company, including the methodologies and assumptions used in determining recorded amounts. + 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 + Details
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