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Reserve for Losses and Loss Adjustment Expenses | 9 Months Ended
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Sep. 30, 2023
Insurance [Abstract] |
Reserve for Losses and Loss Adjustment Expenses | Reserve for Losses and Loss Adjustment Expenses The following table presents a reconciliation of unpaid losses and loss adjustment expenses ("LAE") for the nine months ended September 30, 2023 and 2022:
(Expressed in thousands of U.S. Dollars) | 2023 |  |  |  | 2022 |  |
Gross unpaid losses and loss expenses, beginning of period | $ | 2,856,275 |  |  |  |  | $ | 2,415,491 |  |  |
Reinsurance recoverable on unpaid losses | 1,177,863 |  |  |  |  | 1,112,543 |  |  |
Net unpaid losses and loss expenses, beginning of period | 1,678,412 |  |  |  |  | 1,302,948 |  |  |
Net losses and loss expenses incurred in respect of losses occurring in: |  |  |  |  |  |  |
Current year | 528,457 |  |  |  |  | 600,536 |  |  |
Prior years | (8,903) |  |  |  |  | (3,522) |  |  |
Total incurred | 519,554 |  |  |  |  | 597,014 |  |  |
Net losses and loss expenses paid in respect of losses occurring in: |  |  |  |  |  |  |
Current year | 28,521 |  |  |  |  | 18,901 |  |  |
Prior years | 397,407 |  |  |  |  | 236,661 |  |  |
Total paid | 425,928 |  |  |  |  | 255,562 |  |  |
Foreign currency revaluation and other | 19,661 |  |  |  |  | (39,331) |  |  |
Net unpaid losses and loss expenses, end of period | 1,791,699 |  |  |  |  | 1,605,069 |  |  |
Reinsurance recoverable on unpaid losses | 1,157,123 |  |  |  |  | 1,151,128 |  |  |
Gross unpaid losses and loss expenses, end of period | $ | 2,948,822 |  |  |  |  | $ | 2,756,197 |  |  |
Net favorable prior year development of $8.9 million for the nine months ended September 30, 2023 was comprised of $4.9 million and $4.0 million of favorable prior year development on catastrophe and attritional losses, respectively. See below for further details: •Net favorable development of $20.3 million on specialty contracts, driven by lower than expected claims development across various classes; offset by •Net unfavorable development of $8.8 million on casualty contracts, primarily related to higher than expected claims development across various classes; and •Net unfavorable development of $6.6 million on property contracts, primarily driven by higher than expected claims related to Winterstorm Elliott and development on certain attritional claims, including claims arising from exited classes of business. In addition, casualty business protected by the LPT discussed in Note 7, Reinsurance, recorded favorable gross development, which, in addition to amortization of the associated deferred gain, resulted in a net positive earnings impact of $4.0 million. Net favorable prior year development of $3.5 million for the nine months ended September 30, 2022 was comprised of $15.0 million of favorable prior year development on catastrophe losses offset by $11.5 million of unfavorable prior year development on attritional losses. See below for further details: •Net favorable development of $23.6 million on specialty contracts, driven by reductions in loss estimates; and •Net favorable development of $1.6 million on property contracts, driven by reductions in loss estimates; offset by •Net unfavorable development of $27.7 million on casualty contracts, including claims arising from exited classes of business. . In addition, casualty business protected by the LPT discussed in Note 7, Reinsurance, recorded favorable gross development which was partially offset by amortization of the associated deferred gain, resulting in a net positive earnings impact of $6.0 million. Reinsurance recoverable on unpaid losses related to the LPT discussed in Note 7, Reinsurance was recognized for each of the nine months ended September 30, 2023 and 2022 in the reconciliation of beginning and ending gross and net loss and LAE reserves presented above. The Company amortized acquisition costs of $78.5 million and $65.7 million for the three months ended September 30, 2023 and 2022, respectively, and $220.5 million and $194.8 million for the nine months ended September 30, 2023 and 2022, respectively. Ukraine Conflict The estimate of net reserves for losses and loss adjustment expenses related to the ongoing Ukraine conflict is subject to significant uncertainty. As at September 30, 2023 and December 31, 2022, our recorded reserves relating to the Ukraine conflict totaled $66.2 million and $79.3 million, respectively. Covid-19 Our Covid-19 losses also remain subject to significant uncertainty. Actual ultimate losses for these events may differ materially from the Company's current estimates. As at September 30, 2023 and December 31, 2022, our recorded reserves relating to Covid-19 totaled $13.9 million and $39.0 million, respectively. While the Company believes, based on current facts and circumstances, that its estimates of net reserves for losses and loss adjustment expenses are adequate for losses and loss adjustment expenses that have been incurred at September 30, 2023, the Company will continue to monitor its assumptions as new information becomes available and will adjust its estimate of net reserves for losses and loss adjustment expenses as appropriate. Actual ultimate losses for these events may differ materially from the Company's current estimates.

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- Definition The entire disclosure for liabilities related to future policy benefits and unpaid claims and claim adjustments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 944 -SubTopic 40 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//944-40/tableOfContent + Details
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