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Reinsurance | 6 Months Ended
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Jun. 30, 2017
Insurance [Abstract] |
Reinsurance | 4. Reinsurance The Company seeks to reduce its risk of loss by reinsuring certain levels of risk in various areas of exposure with other insurance enterprises or reinsurers, generally as of the beginning of the hurricane season on June 1st of each year. The Company’s current reinsurance program consists of catastrophe excess of loss reinsurance, subject to the terms and conditions of the applicable agreements. The Company is responsible for insured losses related to catastrophes and other events in excess of coverage provided by its reinsurance program. The Company remains responsible for the settlement of insured losses irrespective of the ability of any of its reinsurers to make payments otherwise due to the Company. Amounts recoverable from reinsurers are estimated in a manner consistent with the terms of the reinsurance contracts. Reinsurance premiums, losses and loss adjustment expenses (“LAE”) are accounted for on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts. In order to reduce credit risk for amounts due from reinsurers, the Insurance Entities seek to do business with financially sound reinsurance companies and regularly evaluate the financial strength of all reinsurers used. The following table presents ratings from rating agencies and the unsecured amounts due from the Company’s reinsurers whose aggregate balance exceeded 3% of the Company’s stockholders’ equity as of the dates presented (in thousands):
|  | Ratings as of June 30, 2017 |  | Due from as of |
|  |  |  | Standard |  |  |  |  |  |  |  |  |  |
|  |  |  | and Poor's |  | Moody's |  |  |  |  |  |  |  |
|  | AM Best |  | Rating |  | Investors |  | June 30, |  |  | December 31, |
Reinsurer |  | Company |  | Services |  | Service, Inc. |  | 2017 |  |  | 2016 |
Florida Hurricane Catastrophe Fund (1) |  | n/a |  | n/a |  | n/a |  | $ | — |  |  | $ | 46,364 |
Total (2) |  |  |  |  |  |  |  | $ | — |  |  | $ | 46,364 |
(1) | No rating is available, because the fund is not rated.
(2) | Amounts represent prepaid reinsurance premiums.
The Company’s reinsurance arrangements had the following effect on certain items in the Condensed Consolidated Statements of Income for the periods presented (in thousands):
| Three Months Ended June 30, |
| 2017 |  |  | 2016 |
|  |  |  |  |  |  |  |  | Losses and Loss |  |  |  |  |  |  |  |  |  |  | Losses and Loss |
| Premiums |  |  | Premiums |  |  | Adjustment |  |  | Premiums |  |  | Premiums |  |  | Adjustment |
| Written |  |  | Earned |  |  | Expenses |  |  | Written |  |  | Earned |  |  | Expenses |
Direct | $ | 296,191 |  |  | $ | 244,623 |  |  | $ | 85,656 |  |  | $ | 271,921 |  |  | $ | 226,819 |  |  | $ | 58,434 |
Ceded |  | (311,338 | ) |  |  | (75,614 | ) |  |  | (5,472 | ) |  |  | (72,874 | ) |  |  | (70,358 | ) |  |  | 1,649 |
Net | $ | (15,147 | ) |  | $ | 169,009 |  |  | $ | 80,184 |  |  | $ | 199,047 |  |  | $ | 156,461 |  |  | $ | 60,083 |
| Six Months Ended June 30, |
| 2017 |  |  | 2016 |
|  |  |  |  |  |  |  |  | Losses and Loss |  |  |  |  |  |  |  |  |  |  | Losses and Loss |
| Premiums |  |  | Premiums |  |  | Adjustment |  |  | Premiums |  |  | Premiums |  |  | Adjustment |
| Written |  |  | Earned |  |  | Expenses |  |  | Written |  |  | Earned |  |  | Expenses |
Direct | $ | 541,606 |  |  | $ | 480,998 |  |  | $ | 156,439 |  |  | $ | 499,894 |  |  | $ | 448,071 |  |  | $ | 124,581 |
Ceded |  | (311,524 | ) |  |  | (150,430 | ) |  |  | (5,685 | ) |  |  | (146,933 | ) |  |  | (139,162 | ) |  |  | 1,619 |
Net | $ | 230,082 |  |  | $ | 330,568 |  |  | $ | 150,754 |  |  | $ | 352,961 |  |  | $ | 308,909 |  |  | $ | 126,200 |
The following prepaid reinsurance premiums and reinsurance recoverable (payable) and receivable are reflected in the Condensed Consolidated Balance Sheets as of the dates presented (in thousands):
| June 30, |  |  | December 31, |
| 2017 |  |  | 2016 |
Prepaid reinsurance premiums | $ | 285,480 |  |  | $ | 124,385 |
Reinsurance recoverable on unpaid losses and LAE | $ | 1,393 |  |  | $ | 106 |
Reinsurance recoverable (payable) on paid losses |  | 1,318 |  |  |  | (1,532 | )
Reinsurance receivable, net |  | — |  |  |  | 186 |
Reinsurance recoverable (payable) and receivable | $ | 2,711 |  |  | $ | (1,240 | )

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- References No definition available. + Details
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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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -URI http://asc.fasb.org/topic&trid=2303980 + Details
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