XML 68 R49.htm IDEA: XBRL DOCUMENT v3.20.4

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

SCHEDULE OF INCOME TAX EXPENSE AND NET TAX ASSETS

The following table provides an analysis of income tax expense and net tax assets:

			Year ended December 31,			2020						2019						2018
			Current income tax expense (benefit)
			U.S.			$	(1,122)					$	12,601					$	(5,401)
			Europe			365						22,425						10,409
			Other			—						469						51
			Deferred income tax expense (benefit)
			U.S.			(3,098)						17,665						15,288
			Europe			(8,466)						(29,468)						(49,833)
			Total income tax expense (benefit)			$	(12,321)					$	23,692					$	(29,486)
			Net current tax receivables (payables)			$	12,205					$	13,130					$	9,683
			Net deferred tax assets (liabilities)			(1,625)						18,621						39,775
			Net tax assets			$	10,580					$	31,751					$	49,458

SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES

The following table provides details of the significant components of deferred tax assets and liabilities:

			At December 31,			2020						2019
			Deferred tax assets:
			Discounting of net reserves for losses and loss expenses			$	47,912					$	40,523
			Unearned premiums			46,049						42,709
			Operating and capital loss carryforwards(1)			80,008						85,901
			Accruals not currently deductible			28,096						29,705
			Tax credits			11,142						2,956
			Other deferred tax assets			24,266						14,355
			Deferred tax assets before valuation allowance			237,473						216,149
			Valuation allowance			(20,778)						(18,560)
			Deferred tax assets net of valuation allowance			216,695						197,589
			Deferred tax liabilities:
			Deferred acquisition costs			(33,550)						(38,320)
			Net unrealized investments gains			(62,921)						(30,434)
			Intangible assets			(46,132)						(44,199)
			Equalization reserves			(2,825)						(2,825)
			Other deferred tax liabilities			(72,892)						(63,190)
			Deferred tax liabilities			(218,320)						(178,968)
			Net deferred tax assets			$	(1,625)					$	18,621

(1)    At December 31, 2020 and 2019, the total operating loss carryforwards includes Lloyd's deferred year of account losses of $39 million and $50 million, respectively.

SUMMARY OF TAX CREDITS

The following table summarizes total operating and capital loss carryforwards and tax credits:

			At December 31,			2020						2019
			Operating and Capital Loss Carryforwards(1)
			Singapore (branch) operating loss carryforward			$	110,504					$	103,899
			U.K. operating loss carryforward(2)			357,226						431,374
			Ireland operating loss carryforward			404						9,064
			Ireland capital loss carryforward			716						716
			Belgian operating loss carryforward			1,850						—
			Tax Credits(1)
			Ireland foreign tax credit			$	2,386					$	2,092
			U.K. tax credit			8,756						864

(1)    At December 31, 2020, all remaining operating and capital loss carryforwards and tax credits can be carried forward indefinitely.

(2)    At December 31, 2020 and 2019, the U.K. operating loss carryforward includes Lloyd's deferred year of account losses of $206 million and $293 million, respectively.

SUMMARY OF OPERATING AND CAPITAL LOSS CARRYFORWARDS

The following table summarizes total operating and capital loss carryforwards and tax credits:

			At December 31,			2020						2019
			Operating and Capital Loss Carryforwards(1)
			Singapore (branch) operating loss carryforward			$	110,504					$	103,899
			U.K. operating loss carryforward(2)			357,226						431,374
			Ireland operating loss carryforward			404						9,064
			Ireland capital loss carryforward			716						716
			Belgian operating loss carryforward			1,850						—
			Tax Credits(1)
			Ireland foreign tax credit			$	2,386					$	2,092
			U.K. tax credit			8,756						864

(1)    At December 31, 2020, all remaining operating and capital loss carryforwards and tax credits can be carried forward indefinitely.

(2)    At December 31, 2020 and 2019, the U.K. operating loss carryforward includes Lloyd's deferred year of account losses of $206 million and $293 million, respectively.

VALUATION ALLOWANCE ROLL FORWARD

The following table shows an analysis of the movement in the Company's valuation allowance:

			At December 31,			2020						2019
			Income tax expense:
			Valuation allowance - beginning of year			$	18,560					$	13,891
			Operating loss carryforwards			661						2,445
			Foreign tax credit			293						(114)
			U.K. branch assets and other foreign rate differentials			1,264						2,338
			Valuation allowance - end of year			$	20,778					$	18,560
			Accumulated other comprehensive income:
			Valuation allowance - beginning of year			—						5,064
			Change in investment - related items			—						(5,064)
			Valuation allowance - end of year			—						—
			Total valuation allowance - end of year			$	20,778					$	18,560

EFFECTIVE TAX RATE RECONCILIATION

The following table presents the distribution of income before income taxes between domestic and foreign jurisdictions as well as a reconciliation of the actual income tax rate to the amount computed by applying the effective tax rate of 0% under Bermuda law to income before income taxes:

			Year ended December 31,			2020						2019						2018
			Income (loss) before income taxes
			Bermuda (domestic)			$	(45,951)					$	179,418					$	181,597
			Foreign			(86,794)						167,747						(168,062)
			Total income (loss) before income taxes			$	(132,745)					$	347,165					$	13,535
			Reconciliation of effective tax rate (% of income before income taxes)
			Expected tax rate			0.0		%				0.0		%				0.0		%
			Foreign taxes at local expected rates:
			U.S.			5.6		%				8.1		%				65.7		%
			Europe			9.2		%				0.4		%				(289.7)		%
			Valuation allowance			(1.7)		%				1.3		%				(13.4)		%
			Net tax exempt income			—		%				—		%				(3.3)		%
			Change in European enacted tax rate			(1.7)		%				—		%				16.9		%
			Other			(2.1)		%				(3.0)		%				5.9		%
			Actual tax rate			9.3		%				6.8		%				(217.9)		%

X

- References

No definition available.

+ Details

Name:	us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix:	us-gaap_
Data Type:	xbrli:stringItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32639-109319

+ Details

Name:	us-gaap_ScheduleOfComponentsOfIncomeTaxExpenseBenefitTableTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32537-109319

+ Details

Name:	us-gaap_ScheduleOfDeferredTaxAssetsAndLiabilitiesTableTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 12
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32687-109319

+ Details

Name:	us-gaap_ScheduleOfEffectiveIncomeTaxRateReconciliationTableTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of pertinent information, such as tax authority, amounts, and expiration dates, of net operating loss carryforwards, including an assessment of the likelihood of utilization.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32559-109319

+ Details

Name:	us-gaap_SummaryOfOperatingLossCarryforwardsTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of tax credit carryforwards available to reduce future taxable income, including amounts, expiration dates, limitations on use and the related deferred tax assets and valuation allowances.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32559-109319

+ Details

Name:	us-gaap_SummaryOfTaxCreditCarryforwardsTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of valuation allowances to reduce deferred tax assets to net realizable value, including identification of the deferred tax asset more likely than not will not be fully realized and the corresponding amount of the valuation allowance.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 2
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32537-109319

+ Details

Name:	us-gaap_SummaryOfValuationAllowanceTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration