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Business Segments (Tables) | 9 Months Ended
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Sep. 30, 2022
Segment Reporting [Abstract] |
Significant components of the Company's continuing operations and selected balance sheet items | The Company's results of operations and selected balance sheet items by segment are presented in the following tables.
Three months ended September 30, 2022 | Specialty |  | Commercial |  | International |  | Life & Group |  | Corporate & Other |  |  |  |
(In millions) |  |  |  |  |  | Eliminations |  | Total
Operating revenues |  |  |  |  |  |  |  |  |  |  |  |  |
Net earned premiums | $ | 810 |  |  | $ | 1,023 |  |  | $ | 270 |  |  | $ | 118 |  |  | $ | — |  |  | $ | — |  |  | $ | 2,221 |
Net investment income | 102 |  |  | 112 |  |  | 16 |  |  | 187 |  |  | 5 |  |  | — |  |  | 422 |
Non-insurance warranty revenue | 399 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 399 |
Other revenues | (1) |  |  | 13 |  |  | — |  |  | — |  |  | 1 |  |  | (2) |  |  | 11 |
Total operating revenues | 1,310 |  |  | 1,148 |  |  | 286 |  |  | 305 |  |  | 6 |  |  | (2) |  |  | 3,053 |
Claims, benefits and expenses |  |  |  |  |  |  |  |  |  |  |  |  |
Net incurred claims and benefits | 459 |  |  | 733 |  |  | 169 |  |  | 310 |  |  | (13) |  |  | — |  |  | 1,658 |
Policyholders’ dividends | 2 |  |  | 5 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 7 |
Amortization of deferred acquisition costs | 169 |  |  | 163 |  |  | 51 |  |  | — |  |  | — |  |  | — |  |  | 383 |
Non-insurance warranty expense | 371 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 371 |
Other insurance related expenses | 88 |  |  | 145 |  |  | 35 |  |  | 29 |  |  | 1 |  |  | (1) |  |  | 297 |
Other expenses | 15 |  |  | 3 |  |  | 11 |  |  | 2 |  |  | 47 |  |  | (1) |  |  | 77 |
Total claims, benefits and expenses | 1,104 |  |  | 1,049 |  |  | 266 |  |  | 341 |  |  | 35 |  |  | (2) |  |  | 2,793 |
Core income (loss) before income tax | 206 |  |  | 99 |  |  | 20 |  |  | (36) |  |  | (29) |  |  | — |  |  | 260 |
Income tax (expense) benefit on core income (loss) | (45) |  |  | (19) |  |  | (1) |  |  | 14 |  |  | 4 |  |  | — |  |  | (47) |
Core income (loss) | $ | 161 |  |  | $ | 80 |  |  | $ | 19 |  |  | $ | (22) |  |  | $ | (25) |  |  | $ | — |  |  | 213 |
Net investment gains (losses) |  |  |  |  |  |  |  |  |  |  |  |  | (96) |
Income tax (expense) benefit on net investment gains (losses) |  |  |  |  |  |  |  |  |  |  |  |  | 11 |
Net investment gains (losses), after tax |  |  |  |  |  |  |  |  |  |  |  |  | (85) |
Net income (loss) |  |  |  |  |  |  |  |  |  |  |  |  | $ | 128 |
Three months ended September 30, 2021 | Specialty |  | Commercial |  | International |  | Life & Group |  | Corporate & Other |  |  |  |
(In millions) |  |  |  |  | Eliminations |  | Total
Operating revenues |  |  |  |  |  |  |  |  |  |  |  |  |
Net earned premiums | $ | 773 |  |  | $ | 893 |  |  | $ | 271 |  |  | $ | 123 |  |  | $ | — |  |  | $ | (1) |  |  | $ | 2,059 |
Net investment income | 116 |  |  | 141 |  |  | 14 |  |  | 240 |  |  | 2 |  |  | — |  |  | 513 |
Non-insurance warranty revenue | 357 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 357 |
Other revenues | 1 |  |  | 7 |  |  | — |  |  | (1) |  |  | 2 |  |  | (1) |  |  | 8 |
Total operating revenues | 1,247 |  |  | 1,041 |  |  | 285 |  |  | 362 |  |  | 4 |  |  | (2) |  |  | 2,937 |
Claims, benefits and expenses |  |  |  |  |  |  |  |  |  |  |  |  |
Net incurred claims and benefits | 446 |  |  | 720 |  |  | 171 |  |  | 296 |  |  | (6) |  |  | — |  |  | 1,627 |
Policyholders’ dividends | — |  |  | 5 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 5 |
Amortization of deferred acquisition costs | 165 |  |  | 148 |  |  | 55 |  |  | — |  |  | — |  |  | — |  |  | 368 |
Non-insurance warranty expense | 330 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 330 |
Other insurance related expenses | 71 |  |  | 125 |  |  | 32 |  |  | 27 |  |  | (1) |  |  | (1) |  |  | 253 |
Other expenses | 13 |  |  | 8 |  |  | 4 |  |  | 1 |  |  | 37 |  |  | (1) |  |  | 62 |
Total claims, benefits and expenses | 1,025 |  |  | 1,006 |  |  | 262 |  |  | 324 |  |  | 30 |  |  | (2) |  |  | 2,645 |
Core income (loss) before income tax | 222 |  |  | 35 |  |  | 23 |  |  | 38 |  |  | (26) |  |  | — |  |  | 292 |
Income tax (expense) benefit on core income (loss) | (49) |  |  | (8) |  |  | (6) |  |  | 3 |  |  | 5 |  |  | — |  |  | (55) |
Core income (loss) | $ | 173 |  |  | $ | 27 |  |  | $ | 17 |  |  | $ | 41 |  |  | $ | (21) |  |  | $ | — |  |  | 237 |
Net investment gains (losses) |  |  |  |  |  |  |  |  |  |  |  |  | 22 |
Income tax (expense) benefit on net investment gains (losses) |  |  |  |  |  |  |  |  |  |  |  |  | (3) |
Net investment gains (losses), after tax |  |  |  |  |  |  |  |  |  |  |  |  | 19 |
Net income (loss) |  |  |  |  |  |  |  |  |  |  |  |  | $ | 256 |
Nine months ended September 30, 2022 | Specialty |  | Commercial |  | International |  | Life & Group |  | Corporate & Other |  |  |  |
(In millions) |  |  |  |  |  | Eliminations |  | Total
Operating revenues |  |  |  |  |  |  |  |  |  |  |  |  |
Net earned premiums | $ | 2,376 |  |  | $ | 2,901 |  |  | $ | 803 |  |  | $ | 356 |  |  | $ | (1) |  |  | $ | — |  |  | $ | 6,435 |
Net investment income | 305 |  |  | 343 |  |  | 44 |  |  | 600 |  |  | 10 |  |  | — |  |  | 1,302 |
Non-insurance warranty revenue | 1,173 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,173 |
Other revenues | — |  |  | 25 |  |  | — |  |  | — |  |  | 4 |  |  | (5) |  |  | 24 |
Total operating revenues | 3,854 |  |  | 3,269 |  |  | 847 |  |  | 956 |  |  | 13 |  |  | (5) |  |  | 8,934 |
Claims, benefits and expenses |  |  |  |  |  |  |  |  |  |  |  |  |
Net incurred claims and benefits | 1,360 |  |  | 1,916 |  |  | 487 |  |  | 884 |  |  | 36 |  |  | — |  |  | 4,683 |
Policyholders’ dividends | 5 |  |  | 15 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 20 |
Amortization of deferred acquisition costs | 488 |  |  | 467 |  |  | 146 |  |  | — |  |  | — |  |  | — |  |  | 1,101 |
Non-insurance warranty expense | 1,092 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,092 |
Other insurance related expenses | 250 |  |  | 409 |  |  | 112 |  |  | 89 |  |  | 4 |  |  | (1) |  |  | 863 |
Other expenses | 40 |  |  | 21 |  |  | 25 |  |  | 7 |  |  | 133 |  |  | (4) |  |  | 222 |
Total claims, benefits and expenses | 3,235 |  |  | 2,828 |  |  | 770 |  |  | 980 |  |  | 173 |  |  | (5) |  |  | 7,981 |
Core income (loss) before income tax | 619 |  |  | 441 |  |  | 77 |  |  | (24) |  |  | (160) |  |  | — |  |  | 953 |
Income tax (expense) benefit on core income (loss) | (134) |  |  | (91) |  |  | (14) |  |  | 31 |  |  | 29 |  |  | — |  |  | (179) |
Core income (loss) | $ | 485 |  |  | $ | 350 |  |  | $ | 63 |  |  | $ | 7 |  |  | $ | (131) |  |  | $ | — |  |  | 774 |
Net investment gains (losses) |  |  |  |  |  |  |  |  |  |  |  |  | (166) |
Income tax (expense) benefit on net investment gains (losses) |  |  |  |  |  |  |  |  |  |  |  |  | 38 |
Net investment gains (losses), after tax |  |  |  |  |  |  |  |  |  |  |  |  | (128) |
Net income (loss) |  |  |  |  |  |  |  |  |  |  |  |  | $ | 646 |
September 30, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |
(In millions) |  |  |  |  |  |  |  |  |  |  |  |  |
Reinsurance receivables | $ | 1,511 |  |  | $ | 952 |  |  | $ | 385 |  |  | $ | 453 |  |  | $ | 2,420 |  |  | $ | — |  |  | $ | 5,721 |
Insurance receivables | 1,061 |  |  | 1,640 |  |  | 309 |  |  | 4 |  |  | — |  |  | — |  |  | 3,014 |
Deferred acquisition costs | 379 |  |  | 315 |  |  | 93 |  |  | — |  |  | — |  |  | — |  |  | 787 |
Goodwill | 117 |  |  | — |  |  | 25 |  |  | — |  |  | — |  |  | — |  |  | 142 |
Deferred non-insurance warranty acquisition expense | 3,653 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 3,653 |
Insurance reserves |  |  |  |  |  |  |  |  |  |  |  |  |
Claim and claim adjustment expenses | 6,925 |  |  | 9,172 |  |  | 2,262 |  |  | 3,645 |  |  | 2,696 |  |  | — |  |  | 24,700 |
Unearned premiums | 3,144 |  |  | 2,364 |  |  | 576 |  |  | 111 |  |  | — |  |  | — |  |  | 6,195 |
Future policy benefits | — |  |  | — |  |  | — |  |  | 10,454 |  |  | — |  |  | — |  |  | 10,454 |
Deferred non-insurance warranty revenue | 4,706 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 4,706 |
Nine months ended September 30, 2021 | Specialty |  | Commercial |  | International |  | Life & Group |  | Corporate & Other |  |  |  |
(In millions) |  |  |  |  | Eliminations |  | Total
Operating revenues |  |  |  |  |  |  |  |  |  |  |  |  |
Net earned premiums | $ | 2,270 |  |  | $ | 2,629 |  |  | $ | 789 |  |  | $ | 369 |  |  | $ | — |  |  | $ | (1) |  |  | $ | 6,056 |
Net investment income | 367 |  |  | 463 |  |  | 42 |  |  | 724 |  |  | 12 |  |  | — |  |  | 1,608 |
Non-insurance warranty revenue | 1,054 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,054 |
Other revenues | 1 |  |  | 17 |  |  | 1 |  |  | (1) |  |  | 5 |  |  | (4) |  |  | 19 |
Total operating revenues | 3,692 |  |  | 3,109 |  |  | 832 |  |  | 1,092 |  |  | 17 |  |  | (5) |  |  | 8,737 |
Claims, benefits and expenses |  |  |  |  |  |  |  |  |  |  |  |  |
Net incurred claims and benefits | 1,312 |  |  | 1,947 |  |  | 485 |  |  | 899 |  |  | 23 |  |  | — |  |  | 4,666 |
Policyholders’ dividends | 2 |  |  | 16 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 18 |
Amortization of deferred acquisition costs | 478 |  |  | 449 |  |  | 157 |  |  | — |  |  | — |  |  | — |  |  | 1,084 |
Non-insurance warranty expense | 973 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 973 |
Other insurance related expenses | 212 |  |  | 376 |  |  | 106 |  |  | 77 |  |  | 9 |  |  | (1) |  |  | 779 |
Other expenses | 36 |  |  | 28 |  |  | (4) |  |  | 5 |  |  | 119 |  |  | (4) |  |  | 180 |
Total claims, benefits and expenses | 3,013 |  |  | 2,816 |  |  | 744 |  |  | 981 |  |  | 151 |  |  | (5) |  |  | 7,700 |
Core income (loss) before income tax | 679 |  |  | 293 |  |  | 88 |  |  | 111 |  |  | (134) |  |  | — |  |  | 1,037 |
Income tax (expense) benefit on core income (loss) | (148) |  |  | (60) |  |  | (21) |  |  | 9 |  |  | 24 |  |  | — |  |  | (196) |
Core income (loss) | $ | 531 |  |  | $ | 233 |  |  | $ | 67 |  |  | $ | 120 |  |  | $ | (110) |  |  | $ | — |  |  | 841 |
Net investment gains (losses) |  |  |  |  |  |  |  |  |  |  |  |  | 117 |
Income tax (expense) benefit on net investment gains (losses) |  |  |  |  |  |  |  |  |  |  |  |  | (22) |
Net investment gains (losses), after tax |  |  |  |  |  |  |  |  |  |  |  |  | 95 |
Net income (loss) |  |  |  |  |  |  |  |  |  |  |  |  | $ | 936 |
December 31, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |
(In millions) |  |  |  |  |  |  |  |  |  |  |  |  |
Reinsurance receivables | $ | 1,200 |  |  | $ | 923 |  |  | $ | 381 |  |  | $ | 401 |  |  | $ | 2,579 |  |  | $ | — |  |  | $ | 5,484 |
Insurance receivables | 1,136 |  |  | 1,488 |  |  | 340 |  |  | 6 |  |  | 4 |  |  | — |  |  | 2,974 |
Deferred acquisition costs | 363 |  |  | 278 |  |  | 96 |  |  | — |  |  | — |  |  | — |  |  | 737 |
Goodwill | 117 |  |  | — |  |  | 31 |  |  | — |  |  | — |  |  | — |  |  | 148 |
Deferred non-insurance warranty acquisition expense | 3,476 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 3,476 |
Insurance reserves |  |  |  |  |  |  |  |  |  |  |  |  |
Claim and claim adjustment expenses | 6,433 |  |  | 8,890 |  |  | 2,280 |  |  | 3,754 |  |  | 2,817 |  |  | — |  |  | 24,174 |
Unearned premiums | 3,001 |  |  | 2,066 |  |  | 585 |  |  | 109 |  |  | — |  |  | — |  |  | 5,761 |
Future policy benefits | — |  |  | — |  |  | — |  |  | 13,236 |  |  | — |  |  | — |  |  | 13,236 |
Deferred non-insurance warranty revenue | 4,503 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 4,503 |
Revenues by line of business | The following table presents operating revenues by line of business for each reportable segment.
Periods ended September 30 | Three Months |  | Nine Months
(In millions) | 2022 |  | 2021 |  | 2022 |  | 2021
Specialty |  |  |  |  |  |  |
Management & Professional Liability | $ | 688 |  |  | $ | 684 |  |  | $ | 2,041 |  |  | $ | 2,044 |
Surety | 171 |  |  | 157 |  |  | 481 |  |  | 454 |
Warranty & Alternative Risks | 451 |  |  | 406 |  |  | 1,332 |  |  | 1,194 |
Specialty revenues | 1,310 |  |  | 1,247 |  |  | 3,854 |  |  | 3,692 |
Commercial |  |  |  |  |  |  |
Middle Market | 397 |  |  | 363 |  |  | 1,133 |  |  | 1,119 |
Construction | 372 |  |  | 345 |  |  | 1,046 |  |  | 978 |
Small Business | 149 |  |  | 144 |  |  | 430 |  |  | 413 |
Other Commercial | 230 |  |  | 189 |  |  | 660 |  |  | 599 |
Commercial revenues | 1,148 |  |  | 1,041 |  |  | 3,269 |  |  | 3,109 |
International |  |  |  |  |  |  |
Canada | 93 |  |  | 87 |  |  | 272 |  |  | 253 |
Europe | 112 |  |  | 123 |  |  | 350 |  |  | 349 |
Hardy | 81 |  |  | 75 |  |  | 225 |  |  | 230 |
International revenues | 286 |  |  | 285 |  |  | 847 |  |  | 832 |
Life & Group revenues | 305 |  |  | 362 |  |  | 956 |  |  | 1,092 |
Corporate & Other revenues | 6 |  |  | 4 |  |  | 13 |  |  | 17 |
Eliminations | (2) |  |  | (2) |  |  | (5) |  |  | (5) |
Total operating revenues | 3,053 |  |  | 2,937 |  |  | 8,934 |  |  | 8,737 |
Net investment gains (losses) | (96) |  |  | 22 |  |  | (166) |  |  | 117 |
Total revenues | $ | 2,957 |  |  | $ | 2,959 |  |  | $ | 8,768 |  |  | $ | 8,854 |

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