Reinsurance

9 Months Ended

Sep. 30, 2021

Retrocession Arrangements And Reinsurance Ceded Receivables [Abstract]

Retrocession Arrangements and Reinsurance Ceded Receivables

Reinsurance Ceded Receivables and Other

Retrocession reinsurance treaties do not relieve the Company from its obligations to direct writing companies. Failure of retrocessionaires to honor their obligations could result in losses to the Company. Consequently, allowances would be established for amounts deemed uncollectible. At September 30, 2021 and December 31, 2020, no allowances were deemed necessary. The Company regularly evaluates the financial condition of the insurance companies from which it assumes and to which it cedes reinsurance.

Retrocessions are arranged through the Company’s retrocession pools for amounts in excess of the Company’s retention limit. As of September 30, 2021 and December 31, 2020, all rated retrocession pool participants followed by the A.M. Best Company were rated “A- (excellent)” or better. The Company verifies retrocession pool participants’ ratings on a quarterly basis. For a majority of the retrocessionaires that were not rated, security in the form of letters of credit or trust assets has been posted. In addition, the Company performs annual financial reviews of its retrocessionaires to evaluate financial stability and performance.

The following table presents information for the Company’s reinsurance ceded receivables and other, including the respective amount and A.M. Best rating for each reinsurer representing in excess of five percent of the total as of September 30, 2021 or December 31, 2020 (dollars in millions):


		September 30, 2021				December 31, 2020
Reinsurer	A.M. Best Rating	Amount		% of Total		Amount		% of Total
Reinsurer A	A+	$	1,634	63.2	%	$	—	—	%
Reinsurer B	A+	412		15.9		420		42.7
Reinsurer C	A+	223		8.6		216		22.0
Reinsurer D	A	64		2.5		64		6.5
Reinsurer E	A+	45		1.7		46		4.7
Reinsurer F	A++	44		1.7		55		5.6
Other reinsurers		164		6.4		182		18.5
Total		$	2,586	100.0	%	$	983	100.0	%

Included in the total reinsurance ceded receivables and other balance were $229 million and $278 million of claims recoverable, of which $13 million and $10 million were in excess of 90 days past due, as of September 30, 2021 and December 31, 2020, respectively. Also included in the total reinsurance ceded receivable and other is a deposit asset on reinsurance of $1,634 million as of September 30, 2021.