Reserves for Losses and Loss Adjustment Expenses

9 Months Ended

Sep. 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 nine months ended September 30, 2018 and 2017 and the twelve months ended December 31, 2017:



	Nine Months Ended September 30, 2018			Nine Months Ended September 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)	—			(125.7		)	(125.5		)

Provision for losses and LAE for claims incurred:
Current year	1,151.4			1,543.3			2,100.1
Prior years	(99.7		)	(92.8		)	(105.4		)
Total incurred	1,051.7			1,450.5			1,994.7
Losses and LAE payments for claims incurred:
Current year	(93.5		)	(150.4		)	(397.5		)
Prior years	(1,170.1		)	(947.7		)	(1,157.6		)
Total paid	(1,263.6		)	(1,098.1		)	(1,555.1		)

Foreign exchange losses/(gains)	(63.3		)	135.2			161.0

Net losses and LAE reserves at period end	4,959.1			5,121.1			5,234.3
Plus reinsurance recoverable on unpaid losses at period end	1,767.1			1,369.5			1,515.2
Provision for losses and LAE at the end of the relevant period	$	6,726.2		$	6,490.6		$	6,749.5

For the nine months ended September 30, 2018, there was a reduction of $99.7 million in the Company’s estimate of the ultimate claims to be paid in respect of prior accident years compared to a reduction of $92.8 million for the nine months ended September 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 September 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	Q3 2018
	$ (in millions)
2012	603.9	625.8	654.8	668.7	653.6	637.1	644.3		27.2	15,726
2013		688.3	666.7	677.9	659.2	649.4	651.7		34.4	14,661
2014			754.2	728.7	701.0	693.7	696.7		51.9	18,872
2015				913.8	903.6	852.8	864.4		124.8	21,221
2016					907.3	879.6	885.7		264.7	21,224
2017						894.2	815.6		158.6	21,367
2018							469.4		289.8	12,316
						Total	$	5,027.8



	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	Q3 2018
	($ in millions)
2012	117.1	307.5	377.9	452.1	502.0	523.8	530.4
2013		90.4	253.9	364.2	454.2	501.9	537.4
2014			99.4	247.1	389.2	465.1	507.8
2015				119.0	326.0	470.6	544.5
2016					117.1	345.5	448.2
2017						167.5	400.2
2018							54.5
					Total		$	3,023.0

	All outstanding liabilities for 2012 and subsequent years, net of reinsurance						$	2,004.8
		All outstanding liabilities before 2012, net of reinsurance					101.3
		Liabilities for claims and claim adjustment expenses, net of reinsurance					$	2,106.1



	Reinsurance
	Incurred Claims, IBNR and Allocated Loss Adjustment Expenses, Net of Reinsurance								As at September 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	Q3 2018
	$ (in millions)
2012	691.8	736.3	720.0	689.6	688.3	686.8	680.4		59.5	3,875
2013		578.6	571.0	548.8	523.1	503.8	497.8		59.0	3,737
2014			549.4	528.4	512.8	485.6	480.3		76.4	3,769
2015				578.5	562.7	556.6	537.8		103.7	4,006
2016					747.8	761.3	764.3		190.5	3,901
2017						1,187.2	1,185.0		339.2	4,165
2018							652.2		517.9	1,971
				Total			$	4,797.8



	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	Q3 2018
	($ in millions)
2012	63.0	247.7	360.4	414.2	458.1	495.8	514.0
2013		63.1	186.4	277.8	319.4	359.1	376.4
2014			56.9	172.1	247.8	288.4	314.4
2015				57.4	170.9	271.5	317.6
2016					125.5	350.5	420.7
2017						227.7	573.4
2018							39.0
					Total		$	2,555.5

	All outstanding liabilities for 2012 and subsequent years, net of reinsurance						2,242.3
		All outstanding liabilities before 2012, net of reinsurance					569.1
		Liabilities for claims and claim adjustment expenses, net of reinsurance					$	2,811.4



	Nine Months Ended September 30, 2018
	($ in millions)
Net outstanding liabilities:
Insurance lines	2,106.1
Reinsurance lines	2,811.4
Net loss and LAE	4,917.5

Reinsurance recoverable on unpaid losses:
Insurance lines	1,448.6
Reinsurance lines	318.5
Total reinsurance recoverable on unpaid losses	1,767.1

Insurance lines other than short-duration	—
Unallocated claims incurred	47.3
Other	(5.7	)
	41.6

Provision for losses and LAE at the end of the period	6,726.2