XML 29 R13.htm IDEA: XBRL DOCUMENT
v3.20.4

Investments | 12 Months Ended
--- | ---
Dec. 31, 2020
Investments [Abstract] |
Investments | INVESTMENTS Fixed Maturity Investments Trading The following table summarizes the fair value of fixed maturity investments trading:
| At December 31. | 2020 |  | 2019 |
| U.S. treasuries | $ | 4,960,409 |  |  | $ | 4,467,345 |  |
| Agencies | 368,032 |  |  | 343,031 |  |
| Non-U.S. government | 491,531 |  |  | 497,392 |  |
| Non-U.S. government-backed corporate | 338,014 |  |  | 321,356 |  |
| Corporate | 4,261,025 |  |  | 3,075,660 |  |
| Agency mortgage-backed | 1,113,792 |  |  | 1,148,499 |  |
| Non-agency mortgage-backed | 291,444 |  |  | 294,604 |  |
| Commercial mortgage-backed | 791,272 |  |  | 468,698 |  |
| Asset-backed | 890,984 |  |  | 555,070 |  |
| Total fixed maturity investments trading | $ | 13,506,503 |  |  | $ | 11,171,655 |  |
Contractual maturities of fixed maturity investments trading are described in the following table. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
| At December 31, 2020 | Amortized Cost |  | Fair Value |  |  |  |  |  |  |  |  |
| Due in less than one year | $ | 632,368 |  |  | $ | 637,418 |  |  |  |  |  |  |  |  |  |
| Due after one through five years | 5,265,502 |  |  | 5,391,122 |  |  |  |  |  |  |  |  |  |
| Due after five through ten years | 3,674,901 |  |  | 3,806,564 |  |  |  |  |  |  |  |  |  |
| Due after ten years | 549,661 |  |  | 583,908 |  |  |  |  |  |  |  |  |  |
| Mortgage-backed | 2,145,366 |  |  | 2,196,507 |  |  |  |  |  |  |  |  |  |
| Asset-backed | 887,237 |  |  | 890,984 |  |  |  |  |  |  |  |  |  |
| Total | $ | 13,155,035 |  |  | $ | 13,506,503 |  |  |  |  |  |  |  |  |  |
Equity Investments Trading The following table summarizes the fair value of equity investments trading:
| At December 31. | 2020 |  | 2019 |
| Financials | $ | 452,765 |  |  | $ | 248,189 |  |
| Communications and technology | 119,592 |  |  | 79,206 |  |
| Consumer | 44,477 |  |  | 35,987 |  |
| Industrial, utilities and energy | 43,380 |  |  | 38,583 |  |
| Healthcare | 35,140 |  |  | 29,510 |  |
| Basic materials | 7,263 |  |  | 5,456 |  |
| Total | $ | 702,617 |  |  | $ | 436,931 |  |
Pledged Investments At December 31, 2020, $8.1 billion of cash and investments at fair value were on deposit with, or in trust accounts for the benefit of, various counterparties, including with respect to the Company’s letter of credit facilities (2019 - $7.0 billion). Of this amount, $2.5 billion is on deposit with, or in trust accounts for the benefit of, U.S. state regulatory authorities (2019 - $2.0 billion). Reverse Repurchase Agreements At December 31, 2020, the Company held $126.5 million (2019 - $57.6 million) of reverse repurchase agreements. These loans are fully collateralized, are generally outstanding for a short period of time and are presented on a gross basis as part of short term investments on the Company’s consolidated balance sheets. The required collateral for these loans typically includes high-quality, readily marketable instruments at a minimum amount of 102% of the loan principal. Upon maturity, the Company receives principal and interest income. Net Investment Income The components of net investment income are as follows:
| Year ended December 31, | 2020 |  | 2019 |  | 2018 |
| Fixed maturity investments | $ | 278,215 |  |  | $ | 318,503 |  |  | $ | 211,973 |  |
| Short term investments | 20,799 |  |  | 56,264 |  |  | 33,571 |  |
| Equity investments | 6,404 |  |  | 4,808 |  |  | 4,474 |  |
| Other investments |  |  |  |  |  |
| Catastrophe bonds | 54,784 |  |  | 46,154 |  |  | 31,051 |  |
| Other | 9,417 |  |  | 8,447 |  |  | — |  |
| Cash and cash equivalents | 2,974 |  |  | 7,676 |  |  | 3,810 |  |
|  | 372,593 |  |  | 441,852 |  |  | 284,879 |  |
| Investment expenses | (18,555) |  |  | (17,645) |  |  | (14,914) |  |
| Net investment income | $ | 354,038 |  |  | $ | 424,207 |  |  | $ | 269,965 |  |
Net Realized and Unrealized Gains (Losses) on Investments Net realized and unrealized gains (losses) on investments are as follows:
| Year ended December 31, | 2020 |  | 2019 |  | 2018 |
| Net realized gains (losses) on fixed maturity investments | 276,901 |  |  | 90,260 |  |  | (69,814) |  |
| Net unrealized gains (losses) on fixed maturity investments trading | 216,859 |  |  | 170,183 |  |  | (57,310) |  |
| Net realized and unrealized gains (loss) on fixed maturity investments trading | 493,760 |  |  | 260,443 |  |  | (127,124) |  |
| Net realized and unrealized gains (losses) on investments-related derivatives | 68,608 |  |  | 58,891 |  |  | (8,784) |  |
| Net realized gains on equity investments trading sold during the period | 3,532 |  |  | 31,062 |  |  | 27,739 |  |
| Net unrealized gains (losses) on equity investments trading still held at reporting date | 262,064 |  |  | 64,087 |  |  | (66,900) |  |
| Net realized and unrealized gains (losses) on equity investments trading | 265,596 |  |  | 95,149 |  |  | (39,161) |  |
| Net realized and unrealized losses on other investments - catastrophe bonds | (7,031) |  |  | (9,392) |  |  | (8,668) |  |
| Net realized and unrealized (losses) gains on other investments - other | (297) |  |  | 9,018 |  |  | 569 |  |
| Net realized and unrealized gains (losses) on investments | $ | 820,636 |  |  | $ | 414,109 |  |  | $ | (183,168) |  |
Other Investments The table below shows the fair value of the Company’s portfolio of other investments:
| At December 31, | 2020 |  | 2019 |
| Catastrophe bonds | $ | 881,290 |  |  | $ | 781,641 |  |
| Private equity investments | 345,501 |  |  | 271,047 |  |
| Senior secured bank loan funds | 19,604 |  |  | 22,598 |  |
| Hedge funds | 10,553 |  |  | 12,091 |  |
| Total other investments | $ | 1,256,948 |  |  | $ | 1,087,377 |  |
Included in net realized and unrealized gains on investments for 2020 is a loss of $2.4 million (2019 - loss of $5.5 million, 2018 - income of $0.3 million) representing the change in estimate during the period related to the difference between the Company’s estimated fair value due to the lag in reporting, as discussed in “Note 2. Significant Accounting Policies,” and the actual amount as reported in the final net asset values provided by the Company’s fund managers. The Company has committed capital to private equity investments, other investments and investments in other ventures of $1.8 billion, of which $809.0 million has been contributed at December 31, 2020. The Company’s remaining commitments to these investments at December 31, 2020 totaled $1.0 billion. In the future, the Company may enter into additional commitments in respect of private equity investments or individual portfolio company investment opportunities. Investments in Other Ventures, under Equity Method The table below shows the Company’s portfolio of investments in other ventures, under equity method:
|  |  |  | 2020 |  |  |  | 2019 |
| At December 31, |  |  | Ownership % |  | Carrying Value |  |  |  | Ownership % |  | Carrying Value |
| Tower Hill Companies (1) |  |  | 2.0% - 25.0% |  | 30,470 |  |  |  |  | 2.0% - 25.0% |  | 36,779 |  |
| Top Layer Re |  |  | 50.0% |  | 26,958 |  |  |  |  | 50.0% |  | 35,363 |  |
| Other |  |  | 25.0% |  | 40,945 |  |  |  |  | 26.6% |  | 34,407 |  |
| Total investments in other ventures, under equity method |  |  |  |  | $ | 98,373 |  |  |  |  |  |  | $ | 106,549 |  |
(1) The Company has equity interests in Bluegrass Insurance Management, LLC, Tower Hill Claims Service, LLC, Tower Hill Holdings, Inc., Tower Hill Insurance Group, LLC, Tower Hill Insurance Managers, LLC, Tower Hill Re Holdings, Inc., Tower Hill Signature Insurance Holdings, Inc. and Tomoka Re Holdings, Inc. (collectively, the “Tower Hill Companies”). The table below shows the Company’s equity in earnings of other ventures, under equity method:
| Year ended December 31, | 2020 |  | 2019 |  | 2018 |
| Top Layer Re | $ | 9,595 |  |  | $ | 8,801 |  |  | $ | 8,852 |  |
| Tower Hill Companies | 3,104 |  |  | 10,337 |  |  | 9,605 |  |
| Other | 4,495 |  |  | 4,086 |  |  | 17 |  |
| Total equity in earnings of other ventures, under equity method | $ | 17,194 |  |  | $ | 23,224 |  |  | $ | 18,474 |  |
During 2020, the Company received $30.0 million of distributions from its investments in other ventures, under equity method (2019 – $36.5 million, 2018 – $26.1 million). Losses from the Company’s investments in other ventures, under equity method, net of distributions received, were $1.6 million at December 31, 2020 (2019 - losses of $0.8 million, 2018 - earnings of $3.8 million). Except for Top Layer Re, which is recorded on a current quarter basis, the equity in earnings of the Company’s investments in other ventures are reported one quarter in arrears.

X
- References No definition available. + Details
Name: | us-gaap_InvestmentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for investments in certain debt and equity securities. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2209399 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 946 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2324412 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -URI http://asc.fasb.org/topic&trid=2196928 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 940 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2176304 + Details
Name: | us-gaap_InvestmentsInDebtAndMarketableEquitySecuritiesAndCertainTradingAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration