Reinsurance

The following table contains a listing of direct, assumed, and ceded reinsurance amounts for premiums written, premiums earned, and loss and loss expenses incurred for the periods indicated. For more information concerning reinsurance, refer to Note 8. “Reinsurance” in Item 8. “Financial Statements and Supplementary Data.” of our 2012 Annual Report.



	Quarter ended September 30,					Nine Months ended September 30,
($ in thousands)	2013			2012		2013		2012
Premiums written:
Direct	$	570,849		520,943		1,650,855		1,504,429
Assumed	22,053			17,976		34,913		44,712
Ceded	(100,154		)	(88,401	)	(280,719	)	(252,888	)
Net	$	492,748		450,518		1,405,049		1,296,253
Premiums earned:
Direct	$	518,307		474,055		1,516,454		1,389,373
Assumed	11,066			18,595		32,480		49,683
Ceded	(91,805		)	(86,425	)	(264,174	)	(261,790	)
Net	$	437,568		406,225		1,284,760		1,177,266
Loss and loss expense incurred:
Direct	$	350,648		327,883		1,055,248		881,537
Assumed	7,264			13,970		22,758		35,039
Ceded	(74,595		)	(69,602	)	(245,246	)	(103,516	)
Net	$	283,317		272,251		832,760		813,060

The growth in direct premium written ("DPW") for our ten insurance subsidiaries ("Insurance Subsidiaries") in both Third Quarter and Nine Months 2013 compared to Third Quarter and Nine Months 2012 reflects: (i) pure price increases that we have achieved in our Standard Insurance Operations; and (ii) strong retention in our Standard Insurance Operations.

Direct premiums earned increases in Third Quarter and Nine Months 2013 were consistent with the fluctuation in DPW for the twelve-month period ended September 30, 2013 as compared to the twelve-month period ended September 30, 2012.

Assumed premiums written for Nine Months 2013 decreased compared to the same period last year as E&S business, which was previously written through a reinsurance fronting agreement, is now written directly by our Insurance Subsidiaries. Decreases in assumed premiums earned in Third Quarter and Nine Months 2013 compared to Third Quarter and Nine Months 2012 were driven by the E&S premiums.

Direct loss and loss expense incurred in Nine Months 2013 included an increase of approximately $128 million related to flood losses covered under the NFIP for Hurricane Sandy, which occurred in October 2012. Total estimated gross flood losses covered by the Insurance Subsidiaries' WYO policies under the NFIP program for this storm were $1,179 million at September 30, 2013 and $1,052 million at December 31, 2012, of which approximately $1,148 million was paid through September 30, 2013.

As all flood losses are fully ceded under the NFIP, the increase in direct loss and loss expense drives the corresponding increase in our ceded losses.

The ceded premiums and losses related to our participation in the NFIP, under which 100% of our flood premiums, losses, and loss expenses are ceded to the NFIP, are as follows:



NFIP	Quarter ended September 30,					Nine Months ended September 30,
($ in thousands)	2013			2012		2013		2012
Ceded premiums written	$	(64,196	)	(58,923	)	(183,364	)	(171,172	)
Ceded premiums earned	(57,920		)	(53,222	)	(169,697	)	(157,895	)
Ceded loss and loss expense incurred	(34,879		)	(32,702	)	(162,780	)	(24,534	)