v2.3.0.15

Segments

9 Months Ended

Sep. 30, 2011

Segments

11. Segments

The Company currently operates three business segments: Diversified Reinsurance, AmTrust Quota Share Reinsurance and ACAC Quota Share. The Company evaluates segment performance based on segment profit separately from the results of our investment portfolio. Other operating expenses allocated to the segments are called General and Administrative expenses which are allocated on an actual basis except salaries and benefits where management’s judgment is applied; the Company does not allocate general corporate expenses to the segments. In determining total assets by segment, the Company identifies those assets that are attributable to a particular segment such as reinsurance balances receivable, funds withheld, prepaid reinsurance premiums, reinsurance recoverable on unpaid losses, deferred commission and other acquisition costs, loans, goodwill and intangibles, and restricted cash and investments. All remaining assets are allocated to Corporate.

The following tables summarize the underwriting results of our operating segments:

For the three months ended September 30, 2011		Diversified Reinsurance				AmTrust Quota Share Reinsurance				ACAC Quota Share				Total
Net premiums written		$	188,652			$	173,502			$	66,432			$	428,586
Net premiums earned			197,803				159,668				62,806				420,277
Other insurance revenue			4,530				—				—				4,530
Net loss and loss adjustment expenses			(123,267	)			(110,727	)			(40,510	)			(274,504	)
Commissions and other acquisition expenses			(62,032	)			(44,845	)			(19,900	)			(126,777	)
General and administrative expenses			(8,468	)			(538	)			(408	)			(9,414	)
Underwriting income		$	8,566			$	3,558			$	1,988			$	14,112
Reconciliation to net income attributable to Maiden shareholders
Net investment income and realized and unrealized investment gains (losses)															15,849
Amortization of intangible assets															(1,258	)
Foreign exchange losses															(1,103	)
Interest and amortization expenses															(8,178	)
Accelerated amortization of junior subordinated debt discount and issuance cost															—
Junior subordinated debt repurchase expense															—
Other general and administrative expenses															(3,061	)
Income tax expense															(359	)
Loss attributable to noncontrolling interest															2
Net income attributable to Maiden shareholders														$	16,004
Net loss and loss expense ratio*			60.9	%			69.3	%			64.5	%			64.6	%
Acquisition cost ratio**			30.7	%			28.1	%			31.7	%			29.8	%
General and administrative expense ratio***			4.2	%			0.4	%			0.6	%			3.0	%
Combined ratio****			95.8	%			97.8	%			96.8	%			97.4	%

For the three months ended September 30, 2010		Diversified Reinsurance				AmTrust Quota Share Reinsurance				ACAC Quota Share				Total
Net premiums written		$	104,452			$	110,313			$	58,670			$	273,435
Net premiums earned			142,419				120,747				46,427				309,593
Net loss and loss adjustment expenses			(95,409	)			(76,199	)			(29,017	)			(200,625	)
Commissions and other acquisition expenses			(34,228	)			(39,011	)			(15,717	)			(88,956	)
General and administrative expenses			(6,745	)			(220	)			(124	)			(7,089	)
Underwriting income		$	6,037			$	5,317			$	1,569			$	12,923
Reconciliation to net income attributable to Maiden shareholders
Net investment income and realized and unrealized investment gains (losses)															19,127
Amortization of intangible assets															(1,452	)
Foreign exchange gains															1,187
Interest and amortization expenses															(9,117	)
Other general and administrative expenses															(3,751	)
Income tax expense															(391	)
Net Income attributable to Maiden shareholders														$	18,526
Net loss and loss expense ratio*			67.0	%			63.1	%			62.5	%			64.8	%
Acquisition cost ratio**			24.0	%			32.3	%			33.9	%			28.7	%
General and administrative expense ratio***			4.8	%			0.2	%			0.2	%			3.5	%
Combined ratio****			95.8	%			95.6	%			96.6	%			97.0	%

For the nine months ended September 30, 2011		Diversified Reinsurance				AmTrust Quota Share Reinsurance				ACAC Quota Share				Total
Net premiums written		$	605,490			$	516,665			$	192,897			$	1,315,052
Net premiums earned			542,325				410,441				181,829				1,134,595
Other insurance revenue			11,364				—				—				11,364
Net loss and loss adjustment expenses			(349,999	)			(279,006	)			(117,280	)			(746,285	)
Commissions and other acquisition expenses			(161,709	)			(120,198	)			(57,766	)			(339,673	)
General and administrative expenses			(24,805	)			(1,802	)			(1,423	)			(28,030	)
Underwriting income		$	17,176			$	9,435			$	5,360			$	31,971
Reconciliation to net income attributable to Maiden shareholders
Net investment income and realized and unrealized investment gains (losses)															55,446
Amortization of intangible assets															(3,775	)
Foreign exchange gains															898
Interest and amortization expenses															(26,588	)
Accelerated amortization of junior subordinated debt discount and issuance cost															(20,313	)
Junior subordinated debt repurchase expense															(15,050	)
Other general and administrative expenses															(9,577	)
Income tax expense															(2,037	)
Loss attributable to noncontrolling interest															5
Net income attributable to Maiden shareholders														$	10,980
Net loss and loss expense ratio*			63.2	%			68.0	%			64.5	%			65.1	%
Acquisition cost ratio**			29.2	%			29.3	%			31.8	%			29.6	%
General and administrative expense ratio***			4.5	%			0.4	%			0.8	%			3.3	%
Combined ratio****			96.9	%			97.7	%			97.1	%			98.0	%

For the nine months ended September 30, 2010		Diversified Reinsurance				AmTrust Quota Share Reinsurance				ACAC Quota Share				Total
Net premiums written		$	409,075			$	340,992			$	147,709			$	897,776
Net premiums earned			455,378				333,070				68,858				857,306
Net loss and loss adjustment expenses			(294,044	)			(209,184	)			(43,036	)			(546,264	)
Commissions and other acquisition expenses			(123,128	)			(108,249	)			(23,422	)			(254,799	)
General and administrative expenses			(18,343	)			(1,292	)			(124	)			(19,759	)
Underwriting income		$	19,863			$	14,345			$	2,276			$	36,484
Reconciliation to net income attributable to Maiden shareholders
Net investment income and realized and unrealized investment gains (losses)															56,430
Amortization of intangible assets															(4,356	)
Foreign exchange losses															(380	)
Interest and amortization expenses															(27,348	)
Other general and administrative expenses															(9,117	)
Income tax expense															(981	)
Net Income attributable to Maiden shareholders														$	50,732
Net loss and loss expense ratio*			64.6	%			62.8	%			62.5	%			63.7	%
Acquisition cost ratio**			27.0	%			32.5	%			34.0	%			29.7	%
General and administrative expense ratio***			4.0	%			0.4	%			0.2	%			3.4	%
Combined ratio****			95.6	%			95.7	%			96.7	%			96.8	%

* Calculated by dividing net loss and loss adjustment expenses by net earned premium and other insurance revenue.

** Calculated by dividing commission and other acquisition expenses by net earned premium and other insurance revenue.

*** Calculated by dividing general and administrative expenses by net earned premium and other insurance revenue.

**** Calculated by adding together net loss and loss expense ratio, acquisition cost ratio and general and administrative expense ratio.

As of September 30, 2011		Diversified Reinsurance				AmTrust Quota Share Reinsurance				ACAC Quota Share				Total
Reinsurance balances receivable, net		$	191,064			$	107,761			$	73,696			$	372,521
Funds withheld			143,952				—				—				143,952
Prepaid reinsurance premiums			39,339				—				—				39,339
Reinsurance recoverable on unpaid losses			12,573				—				—				12,573
Deferred commission and other acquisition costs			103,850				114,714				29,580				248,144
Loan to related party			—				167,975				—				167,975
Goodwill and intangible assets, net			100,026				—				—				100,026
Restricted investments and cash			966,990				429,926				57,491				1,454,407
Corporate and other assets			749				—				—				717,130
Total Assets		$	1,558,543			$	820,376			$	160,767			$	3,256,067

As of December 31, 2010		Diversified Reinsurance				AmTrust Quota Share Reinsurance				ACAC Quota Share				Total
Reinsurance balances receivable, net		$	131,109			$	25,566			$	69,658			$	226,333
Funds withheld			152,713				—				—				152,713
Prepaid reinsurance premiums			28,992				—				—				28,992
Reinsurance recoverable on unpaid losses			6,656				—				—				6,656
Deferred commission and other acquisition costs			85,252				92,155				26,224				203,631
Loan to related party			—				167,975				—				167,975
Goodwill and intangible assets, net			103,905				—				—				103,905
Restricted investments and cash			1,136,252				358,621				23,979				1,518,852
Corporate and other assets			88				—				—				573,505
Total Assets		$	1,644,967			$	644,317			$	119,861			$	2,982,562

The following tables set forth financial information relating to gross and net premiums written and earned by major line of business for the three and nine months ended September 30, 2011 and 2010:

For the three months ended September 30,		2011								2010
		Total				% of Total				Total				% of Total
Net premiums written
Diversified Reinsurance
Property		$	46,908				10.9	%		$	37,471				13.7	%
Casualty			106,413				24.8	%			54,178				19.8	%
Accident and Health			13,238				3.1	%			12,803				4.7	%
International			22,093				5.2	%			—				—
Total Diversified Reinsurance			188,652				44.0	%			104,452				38.2	%
AmTrust Quota Share Reinsurance
Small Commercial Business			57,836				13.5	%			43,664				16.0	%
Specialty Program			38,242				8.9	%			20,996				7.7	%
Specialty Risk and Extended Warranty			77,424				18.1	%			45,653				16.7	%
Total AmTrust Quota Share Reinsurance			173,502				40.5	%			110,313				40.4	%
ACAC Quota Share
Automobile Liability			38,453				9.0	%			33,565				12.2	%
Automobile Physical Damage			27,979				6.5	%			25,105				9.2	%
Total ACAC Quota Share			66,432				15.5	%			58,670				21.4	%
		$	428,586				100.0	%		$	273,435				100.0	%

For the nine months ended September 30,		2011								2010
		Total				% of Total				Total				% of Total
Net premiums written
Diversified Reinsurance
Property		$	168,612				12.8	%		$	131,800				14.7	%
Casualty			314,216				23.9	%			238,194				26.5	%
Accident and Health			36,779				2.8	%			39,081				4.4	%
International			85,883				6.5	%			—				—
Total Diversified Reinsurance			605,490				46.0	%			409,075				45.6	%
AmTrust Quota Share Reinsurance
Small Commercial Business			174,448				13.3	%			147,494				16.4	%
Specialty Program			73,674				5.6	%			51,897				5.8	%
Specialty Risk and Extended Warranty			268,543				20.4	%			141,601				15.8	%
Total AmTrust Quota Share Reinsurance			516,665				39.3	%			340,992				38.0	%
ACAC Quota Share
Automobile Liability			110,661				8.4	%			84,524				9.4	%
Automobile Physical Damage			82,236				6.3	%			63,185				7.0	%
Total ACAC Quota Share			192,897				14.7	%			147,709				16.4	%
		$	1,315,052				100.0	%		$	897,776				100.0	%

For the three months ended September 30,		2011								2010
		Total				% of Total				Total				% of Total
Net premiums earned
Diversified Reinsurance
Property		$	45,345				10.8	%		$	42,800				13.8	%
Casualty			107,757				25.6	%			86,028				27.8	%
Accident and Health			10,425				2.5	%			13,591				4.4	%
International			34,276				8.2	%			—				—
Total Diversified Reinsurance			197,803				47.1	%			142,419				46.0	%
AmTrust Quota Share Reinsurance
Small Commercial Business			55,542				13.2	%			46,744				15.1	%
Specialty Program			26,642				6.3	%			21,494				6.9	%
Specialty Risk and Extended Warranty			77,484				18.5	%			52,509				17.0	%
Total AmTrust Quota Share Reinsurance			159,668				38.0	%			120,747				39.0	%
ACAC Quota Share
Automobile Liability			36,126				8.6	%			26,001				8.4	%
Automobile Physical Damage			26,680				6.3	%			20,426				6.6	%
Total ACAC Quota Share			62,806				14.9	%			46,427				15.0	%
		$	420,277				100.0	%		$	309,593				100.0	%

For the nine months ended September 30,		2011								2010
		Total				% of Total				Total				% of Total
Net premiums earned
Diversified Reinsurance
Property		$	134,741				11.9	%		$	132,138				15.4	%
Casualty			285,716				25.2	%			270,103				31.5	%
Accident and Health			33,524				3.0	%			53,137				6.2	%
International			88,344				7.7	%			—				—
Total Diversified Reinsurance			542,325				47.8	%			455,378				53.1	%
AmTrust Quota Share Reinsurance
Small Commercial Business			156,041				13.7	%			154,884				18.1	%
Specialty Program			63,155				5.6	%			52,948				6.2	%
Specialty Risk and Extended Warranty			191,245				16.9	%			125,238				14.6	%
Total AmTrust Quota Share Reinsurance			410,441				36.2	%			333,070				38.9	%
ACAC Quota Share
Automobile Liability			104,146				9.2	%			38,595				4.5	%
Automobile Physical Damage			77,683				6.8	%			30,263				3.5	%
Total ACAC Quota Share			181,829				16.0	%			68,858				8.0	%
		$	1,134,595				100.0	%		$	857,306				100.0	%

X

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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