Reserves for Losses and Loss Adjustment Expenses

6 Months Ended

Jun. 30, 2018

Reserves For Loss And Adjustment Expenses

Reserves for Losses and Loss Adjustment Expenses

The following table represents a reconciliation of beginning and ending consolidated loss and loss adjustment expenses (“LAE”) reserves for the six months ended June 30, 2018 and 2017 and the twelve months ended December 31, 2017:



	Six Months Ended June 30, 2018			Six Months Ended June 30, 2017			Twelve Months Ended December 31, 2017
	($ in millions)
Provision for losses and LAE at the start of the year	$	6,749.5		$	5,319.9		$	5,319.9
Less reinsurance recoverable	(1,515.2		)	(560.7		)	(560.7		)
Net loss and LAE at the start of the year	5,234.3			4,759.2			4,759.2

Net loss and LAE expenses (disposed)	—			—			(125.5		)

Provision for losses and LAE for claims incurred:
Current year	700.8			749.2			2,100.1
Prior years	(80.2		)	(74.9		)	(105.4		)
Total incurred	620.6			674.3			1,994.7
Losses and LAE payments for claims incurred:
Current year	(49.7		)	(54.4		)	(397.5		)
Prior years	(874.7		)	(686.7		)	(1,157.6		)
Total paid	(924.4		)	(741.1		)	(1,555.1		)

Foreign exchange losses/(gains)	(54.1		)	99.6			161.0

Net losses and LAE reserves at period end	4,876.4			4,792.0			5,234.3
Plus reinsurance recoverable on unpaid losses at period end	1,656.4			779.4			1,515.2
Provision for losses and LAE at the end of the relevant period	$	6,532.8		$	5,571.4		$	6,749.5

For the six months ended June 30, 2018, there was a reduction of $80.2 million in the Company’s estimate of the ultimate claims to be paid in respect of prior accident years compared to a reduction of $74.9 million for the six months ended June 30, 2017. The Company ceded $125.5 million of reserves as part of an adverse development cover purchased during the twelve months ended December 31, 2017. For additional information on the reserve releases, please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Reserves for Losses and Loss Adjustment Expenses” below.



	Insurance
	Incurred Claims, IBNR and Allocated Loss Adjustment Expenses, Net of Reinsurance								As at June 30, 2018
									Total of IBNR Plus Expected Development on Reported Claims	Cumulative Number of Reported Claims
	For the Years Ended December 31,
	Unaudited Prior Years
Accident Year	2012	2013	2014	2015	2016	2017	Q2 2018
	$ (in millions)
2012	605.0	626.8	655.9	669.9	654.7	638.2	647.2		45.9	15,682
2013		689.6	667.9	679.0	660.4	650.6	651.1		32.4	14,631
2014			755.6	730.1	702.4	695.1	699.5		68.0	18,836
2015				916.0	905.9	855.1	858.1		154.4	21,132
2016					909.3	881.6	873.6		284.6	21,052
2017						896.1	847.7		175.9	20,622
2018							307.0		192.9	6,929
						Total	$	4,884.2



	Insurance
	Cumulative Paid Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance

	For the Years Ended December 31,
	Unaudited Prior Years
Accident Year	2012	2013	2014	2015	2016	2017	Q2 2018
	($ in millions)
2012	117.3	307.9	378.5	452.9	502.8	524.7	531.7
2013		90.7	254.5	364.9	455.0	502.8	532.7
2014			99.5	247.5	389.8	465.9	481.0
2015				119.2	326.9	471.9	523.4
2016					117.3	346.1	415.4
2017						167.8	369.5
2018							32.2
					Total		$	2,885.9

	All outstanding liabilities for 2012 and subsequent years, net of reinsurance						$	1,998.3
		All outstanding liabilities before 2012, net of reinsurance					114.0
		Liabilities for claims and claim adjustment expenses, net of reinsurance					$	2,112.3



	Reinsurance
	Incurred Claims, IBNR and Allocated Loss Adjustment Expenses, Net of Reinsurance								As at June 30, 2018
									Total of IBNR Plus Expected Development on Reported Claims	Cumulative Number of Reported Claims
	For the Years Ended December 31,
	Unaudited Prior Years
Accident Year	2012	2013	2014	2015	2016	2017	Q2 2018
	$ (in millions)
2012	692.8	737.3	720.9	690.6	689.4	687.9	686.7		71.2	3,838
2013		579.6	572.2	550.2	524.3	504.9	499.7		66.2	3,689
2014			550.6	529.9	514.2	487.1	477.5		82.8	3,696
2015				580.3	564.5	558.2	536.9		117.6	3,899
2016					749.1	762.8	768.9		218.1	3,709
2017						1,190.2	1,189.0		420.5	3,746
2018							362.5		289.9	1,415
				Total			$	4,521.2



	Reinsurance
	Cumulative Paid Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance

	For the Years Ended December 31,
	Unaudited Prior Years
Accident Year	2012	2013	2014	2015	2016	2017	Q2 2018
	($ in millions)
2012	63.2	248.2	360.9	414.8	458.7	496.5	511.4
2013		63.2	186.8	278.4	320.1	359.9	371.6
2014			57.0	172.6	248.5	289.2	308.1
2015				57.5	171.4	272.1	306.2
2016					125.5	350.7	400.0
2017						227.9	508.1
2018							17.5
					Total		$	2,422.9

	All outstanding liabilities for 2012 and subsequent years, net of reinsurance						2,098.3
		All outstanding liabilities before 2012, net of reinsurance					619.9
		Liabilities for claims and claim adjustment expenses, net of reinsurance					$	2,718.2



	Six Months Ended June 30, 2018
	($ in millions)
Net outstanding liabilities:
Insurance lines	2,112.3
Reinsurance lines	2,718.2
Net loss and LAE	4,830.5

Reinsurance recoverable on unpaid losses:
Insurance lines	1,382.8
Reinsurance lines	273.6
Total reinsurance recoverable on unpaid losses	1,656.4

Insurance lines other than short-duration	—
Unallocated claims incurred	49.7
Other	(3.8	)
	45.9

Provision for losses and LAE at the end of the period	6,532.8