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Third Party Reinsurance | 3 Months Ended
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Mar. 31, 2021
Reinsurance Disclosures [Abstract] |
Third Party Reinsurance | Third Party Reinsurance In the normal course of business, Ark may seek to limit losses that may arise from catastrophes or other events by reinsuring with third party reinsurers. Ark remains liable for risks reinsured in the event that the reinsurer does not honor its obligations under reinsurance contracts. The following table summarizes the effects of reinsurance on written and earned premiums and on losses and LAE for Ark.
|  | Three Months Ended March 31, 2021 |  |
Millions |  |  |
Written premiums: |  |  |  |
Gross |  | $ | 404.5 |  |  |
Ceded |  | (62.1) |  |  |
Net written premiums |  | $ | 342.4 |  |  |
Earned premiums: |  |  |  |
Gross |  | $ | 162.6 |  |  |
Ceded |  | (58.0) |  |  |
Net earned premiums |  | $ | 104.6 |  |  |
Losses and LAE: |  |  |  |
Gross |  | $ | 115.6 |  |  |
Ceded |  | (49.6) |  |  |
Net Losses and LAE |  | $ | 66.0 |  |  |
As of March 31, 2021, Ark had $447.5 million and $1.5 million of reinsurance recoverables on unpaid and paid losses. As reinsurance contracts do not relieve Ark of its obligation to its policyholders, Ark seeks to reduce the credit risk associated with reinsurance balances by avoiding over-reliance on specific reinsurers through the application of concentration limits and thresholds. Ark is selective with its reinsurers, placing reinsurance with only those reinsurers having a strong financial condition. Ark monitors the financial strength of its reinsurers on an ongoing basis. As of March 31, 2021, Ark’s reinsurance recoverables on unpaid losses of $447.5 million included $331.0 million related to TPC Providers, which are collateralized. Of the remaining $116.5 million of reinsurance recoverables on unpaid losses, 90% are from reinsurers with an A.M. Best rating of “A” (Excellent, which is the third highest of 16 financial strength ratings). See Note 10 — “Municipal Bond Guarantee Insurance” for third-party reinsurance balances related to White Mountains financial guarantee business.

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- Definition The entire disclosure pertaining to the existence, magnitude and information about insurance that has been ceded to or assumed from another insurance company, including the methodologies and assumptions used in determining recorded amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -URI http://asc.fasb.org/topic&trid=2303980 + Details
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