UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

~~_X_~~ ~~Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934~~

~~For the quarterly period ended~~ ~~March 31,~~ ~~2022~~

~~___~~ ~~Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934~~


			☒						Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
									For the quarterly period ended March 31, 2023

									Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission file number 1-15731

EVEREST RE GROUP, LTD.

(Exact name of registrant as specified in its charter)

~~Bermuda~~	~~98-0365432~~
Bermuda		98-0365432
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

~~Seon Place – 4th Floor~~

~~141 Front Street~~

~~PO Box HM 845~~

~~HamiltonHM 19, Bermuda~~


Seon Place – 4th Floor 141 Front Street PO Box HM 845 Hamilton Bermuda						HM 19
(Address of principal executive offices)						(Zip Code)

441-295-0006

(~~Address, including zip code, and~~Registrant’s telephone number, including area ~~code,~~code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of ~~registrant’s principal executive office)~~

the Act:

Class

Trading Symbol

Name of Exchange where Registered

Common Shares, $0.01 par value

New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

~~Indicate~~

If an emerging growth company, indicate by check mark if the registrant ~~is an emerging growth company and~~ has elected not to use the extended transition period for

complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange ~~act.~~

~~YES~~

Act. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES

~~Securities registered pursuant to Section 12(b)~~

Indicate the number of shares outstanding of each of the ~~Act:~~

issuer’s classes of common stock, as of the latest practicable date.

~~Class~~

~~Trading Symbol~~

~~Name of Exchange where~~

~~Registered~~

Class

Number of Shares Outstanding

At May 1, ~~2022~~

2023

Common Shares, $0.01 par value

~~New York Stock Exchange~~

~~39,437,963~~

39,275,224

Table of Contents

EVEREST RE GROUP, LTD

Table of Contents

Form 10-Q

~~Page~~

~~PART I~~

~~FINANCIAL INFORMATION~~

~~Item 1.~~	~~Financial Statements~~
				Page
			PART I

			FINANCIAL INFORMATION

Item 1.			Financial Statements

			Consolidated Balance Sheets as of March 31, 2023 (unaudited) and December 31, 2022 ~~(unaudited)~~	1
			~~and December 31, 2021~~	1

	Consolidated Statements of Operations and Comprehensive Income (Loss) for the three months ended March 31, 2023 and 2022 (unaudited)	2
			~~three months ended March 31, 2022 and 2021 (unaudited)~~	2

	Consolidated Statements of Changes in Shareholders’ Equity for the three months ended March 31, 2023 and 2022 (unaudited)	3
			~~months ended March 31, 2022 and 2021 (unaudited)~~	3

	Consolidated Statements of Cash Flows for the three months ended March 31, 2023 and 2022 (unaudited)	4
			~~March 31, 2022 and 2021 (unaudited)~~	4

	Notes to Consolidated Interim Financial Statements (unaudited)	5

Item 2.			Management’s Discussion and Analysis of Financial Condition and
	Results of Operation	2729

Item 3.			Quantitative and Qualitative Disclosures About Market Risk	4243

Item 4.			Controls and Procedures	4243

~~PART II~~

~~OTHER INFORMATION~~

Table of Contents

EVEREST RE GROUP, LTD.

CONSOLIDATED BALANCE SHEETS

March 31,

December 31,
(Dollars and share amounts in thousands, except par value per share)
2022

2021

(unaudited)

ASSETS:

Fixed maturities - available for sale
$
21,998,415

$
22,308,272
(amortized cost: 2022, $22,693,029; 2021, $22,063,592, credit allowances: 2022, $(41,591); 2021, $(29,738))

Equity securities, at fair value

1,780,526

1,825,908
Short-term investments (cost: 2022, $823,889; 2021, $1,178,386)

823,875

1,178,337
Other invested assets

2,917,039

2,919,965
Cash

1,778,218

1,440,861
Total investments and cash

29,298,073

29,673,343
Accrued investment income

156,997

149,105
Premiums receivable

3,264,023

3,293,598
Reinsurance recoverables

2,101,641

2,053,354
Funds held by reinsureds

920,054

868,601
Deferred acquisition costs

842,739

872,289
Prepaid reinsurance premiums

496,632

515,445
Income taxes

117,609

2,381
Other assets

789,014

757,167
TOTAL ASSETS
$
37,986,782

$
38,185,283

LIABILITIES:

Reserve for losses and loss adjustment expenses
$
19,495,637

$
19,009,486
Future policy benefit reserve

34,523

35,669
Unearned premium reserve

4,571,705

4,609,634
Funds held under reinsurance treaties

4,732

18,391
Other net payable to reinsurers

464,000

449,723
Losses in course of payment

133,888

260,684
Senior notes

2,346,147

2,345,800
Long term notes

223,799

223,774
Borrowings from FHLB

519,000

519,000
Accrued interest on debt and borrowings

38,843

17,348
Unsettled securities payable

67,698

16,698
Other liabilities

559,181

539,896
Total liabilities

28,459,153

28,046,103

Commitments and contingencies (Note 7)

(nil)

(nil)

SHAREHOLDERS' EQUITY:

Preferred shares, par value: $0.01; 50,000 shares authorized;

0 shares issued and outstanding

-

-
Common shares, par value: $0.01; 200,000 shares authorized; (2022) 69,977

and (2021) 69,790 outstanding before treasury shares

700

698
Additional paid-in capital

2,271,890

2,274,431
Accumulated other comprehensive income (loss), net of deferred income

tax expense (benefit) of $(89,926) at 2022 and $26,781 at 2021

(832,820)

11,523
Treasury shares, at cost; 30,529 shares (2022) and 30,524 shares (2021)

(3,848,630)

(3,847,308)
Retained earnings

11,936,489

11,699,836
Total shareholders' equity

9,527,629

10,139,180
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
$
37,986,782

$
38,185,283

The accompanying notes are an integral part of the consolidated financial statements.

March 31, December 31,
(Dollars and share amounts in millions, except par value per share) 2023 2022
(unaudited)
ASSETS:
Fixed maturities - available for sale, at fair value (amortized cost: 2023, $25,247; 2022, $24,191, credit allowances: 2023, $(62); 2022, $(54)) $ 23,560 $ 22,236
Fixed maturities - held to maturity, at amortized cost (fair value: 2023, $814; 2022, $821, net of credit allowances: 2023, $(9); 2022, $(9)) 825 839
Equity securities, at fair value 250 281
Other invested assets 4,156 4,085
Short-term investments 1,034 1,032
Cash 1,610 1,398
Total investments and cash 31,435 29,872
Accrued investment income 235 217
Premiums receivable (net of credit allowances: 2023, $(30); 2022, $(29)) 3,922 3,619
Reinsurance paid loss recoverables (net of credit allowances: 2023, $(24); 2022, $(23)) 182 136
Reinsurance unpaid loss recoverables 2,125 2,105
Funds held by reinsureds 1,071 1,056
Deferred acquisition costs 1,011 962
Prepaid reinsurance premiums 611 610
Income tax asset, net 387 459
Other assets (net of credit allowances: 2023, $(7); 2022, $(5)) 860 930
TOTAL ASSETS $ 41,839 $ 39,966
LIABILITIES:
Reserve for losses and loss adjustment expenses $ 22,878 $ 22,065
Future policy benefit reserve 29 29
Unearned premium reserve 5,418 5,147
Funds held under reinsurance treaties 10 13
Other net payable to reinsurers 618 567
Losses in course of payment 123 74
Senior notes 2,348 2,347
Long-term notes 218 218
Borrowings from FHLB 519 519
Accrued interest on debt and borrowings 41 19
Unsettled securities payable 201 1
Other liabilities 422 526
Total liabilities 32,825 31,525
Commitments and contingencies (Note 7)
SHAREHOLDERS' EQUITY:
Preferred shares, par value: $0.01; 50.0 shares authorized; no shares issued and outstanding — —
Common shares, par value: $0.01; 200.0 shares authorized; (2023) 70.0 and (2022) 69.9 outstanding before treasury shares 1 1
Additional paid-in capital 2,295 2,302
Accumulated other comprehensive income (loss), net of deferred income tax expense (benefit) of $(218) at 2023 and $(250) at 2022 (1,716) (1,996)
Treasury shares, at cost; 30.8 shares (2023) and 30.8 shares (2022) (3,908) (3,908)
Retained earnings 12,342 12,042
Total shareholders' equity 9,014 8,441
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 41,839 $ 39,966

The accompanying notes are an integral part of the consolidated financial statements.

Table of Contents

EVEREST RE GROUP, LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME (LOSS)

Three Months Ended

March 31,
(Dollars in thousands, except per share amounts)
2022

2021

(unaudited)
REVENUES:

Premiums earned
$
2,791,765

$
2,387,865
Net investment income

242,830

260,413
Net gains (losses) on investments:

Credit allowances on fixed maturity securities

(11,853)

(6,977)
Gains (losses) from fair value adjustments

(136,860)

29,056
Net realized gains (losses) from dispositions

(4,914)

16,823
Total net gains (losses) on investments

(153,627)

38,902
Other income (expense)

15,363

56,593
Total revenues

2,896,331

2,743,773

CLAIMS AND EXPENSES:

Incurred losses and loss adjustment expenses

1,789,863

1,711,419
Commission, brokerage, taxes and fees

605,230

489,011
Other underwriting expenses

161,293

142,231
Corporate expenses

14,020

12,378
Interest, fees and bond issue cost amortization expense

24,078

15,639
Total claims and expenses

2,594,484

2,370,678

INCOME (LOSS) BEFORE TAXES

301,847

373,095
Income tax expense (benefit)

4,096

31,233

NET INCOME (LOSS)
$
297,751

$
341,862

Other comprehensive income (loss), net of tax:

Unrealized appreciation (depreciation) ("URA(D)") on securities arising during the period

(815,177)

(288,615)
Reclassification adjustment for realized losses (gains) included in net income (loss)

4,178

(3,666)
Total URA(D) on securities arising during the period

(810,999)

(292,281)

Foreign currency translation adjustments

(34,102)

(9,582)

Reclassification adjustment for amortization of net (gain) loss included in net income (loss)

758

2,043
Total benefit plan net gain (loss) for the period

758

2,043
Total other comprehensive income (loss), net of tax

(844,343)

(299,820)

COMPREHENSIVE INCOME (LOSS)
$
(546,592)

$
42,042

EARNINGS PER COMMON SHARE:

Basic
$
7.57

$
8.53
Diluted

7.56

8.52

The accompanying notes are an integral part of the consolidated financial statements.

Three Months Ended
March 31,
(Dollars in millions, except per share amounts) 2023 2022
(unaudited)
REVENUES:
Premiums earned $ 3,100 $ 2,792
Net investment income 260 243
Net gains (losses) on investments:
Credit allowances on fixed maturity securities (8) (12)
Gains (losses) from fair value adjustments 4 (137)
Net realized gains (losses) from dispositions 8 (5)
Total net gains (losses) on investments 5 (154)
Other income (expense) (79) 15
Total revenues 3,286 2,896
CLAIMS AND EXPENSES:
Incurred losses and loss adjustment expenses 1,966 1,790
Commission, brokerage, taxes and fees 661 605
Other underwriting expenses 200 161
Corporate expenses 19 14
Interest, fees and bond issue cost amortization expense 32 24
Total claims and expenses 2,878 2,594
INCOME (LOSS) BEFORE TAXES 408 302
Income tax expense (benefit) 43 4
NET INCOME (LOSS) $ 365 $ 298
Other comprehensive income (loss), net of tax:
Unrealized appreciation (depreciation) ("URA(D)") on securities arising during the period 246 (815)
Reclassification adjustment for realized losses (gains) included in net income (loss) 3 4
Total URA(D) on securities arising during the period 249 (811)
Foreign currency translation adjustments 31 (34)
Reclassification adjustment for amortization of net (gain) loss included in net income (loss) — 1
Total benefit plan net gain (loss) for the period — 1
Total other comprehensive income (loss), net of tax 280 (844)
COMPREHENSIVE INCOME (LOSS) $ 645 $ (547)
EARNINGS PER COMMON SHARE:
Basic $ 9.31 $ 7.57
Diluted 9.31 7.56

The accompanying notes are an integral part of the consolidated financial statements.

Table of Contents

EVEREST RE GROUP, LTD.

CONSOLIDATED STATEMENTS OF

CHANGES IN SHAREHOLDERS’ EQUITY

(Dollars in thousands, except share and dividends per share amounts)
2022

2021

(unaudited)
COMMON SHARES (shares outstanding):

Balance, January 1

39,266,633

39,983,481
Issued during the period, net

187,044

196,481
Treasury shares acquired

(5,000)

(97,462)
Balance, March 31

39,448,677

40,082,500

COMMON SHARES (par value):

Balance, January 1
$
698

$
696
Issued during the period, net

2

2
Balance, March 31

700

698

ADDITIONAL PAID-IN CAPITAL:

Balance, January 1

2,274,431

2,245,301
Share-based compensation plans

(2,541)

436
Balance, March 31

2,271,890

2,245,737

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS),

NET OF DEFERRED INCOME TAXES:

Balance, January 1

11,523

534,899
Net increase (decrease) during the period

(844,343)

(299,820)
Balance, March 31

(832,820)

235,079

RETAINED EARNINGS:

Balance, January 1

11,699,836

10,567,452
Net income (loss)

297,751

341,862
Dividends declared ($1.55 per share 2022 and $1.55 per share 2021)

(61,097)

(62,228)
Balance, March 31

11,936,489

10,847,085

TREASURY SHARES AT COST:

Balance, January 1

(3,847,308)

(3,622,172)
Purchase of treasury shares

(1,322)

(23,545)
Balance, March 31

(3,848,630)

(3,645,717)

TOTAL SHAREHOLDERS' EQUITY, March 31
$
9,527,629

$
9,682,882

The accompanying notes are an integral part of the consolidated financial statements.

Three Months Ended
March 31,
(Dollars in millions, except dividends per share amounts) 2023 2022
(unaudited)
COMMON SHARES (shares outstanding):
Balance beginning of period 39 39
Issued (redeemed) during the period, net — —
Treasury shares acquired — —
Balance end of period 39 39
COMMON SHARES (par value):
Balance beginning of period $ 1 $ 1
Issued during the period, net — —
Balance end of period 1 1
ADDITIONAL PAID-IN CAPITAL:
Balance beginning of period 2,302 2,274
Share-based compensation plans (7) (3)
Balance end of period 2,295 2,272
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS), NET OF DEFERRED INCOME TAXES:
Balance beginning of period (1,996) 12
Net increase (decrease) during the period 280 (844)
Balance end of period (1,716) (833)
RETAINED EARNINGS:
Balance beginning of period 12,042 11,700
Net income (loss) 365 298
Dividends declared ($1.65 per share in 1Q2023 and $1.55 per share in 1Q2022) (65) (61)
Balance, end of period 12,342 11,936
TREASURY SHARES AT COST:
Balance beginning of period (3,908) (3,847)
Purchase of treasury shares — (1)
Balance end of period (3,908) (3,849)
TOTAL SHAREHOLDERS' EQUITY, END OF PERIOD $ 9,014 $ 9,528

The accompanying notes are an integral part of the consolidated financial statements.

Table of Contents

EVEREST RE GROUP, LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

March 31,
(Dollars in thousands)
2022

2021

(unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:

Net income (loss)
$
297,751

$
341,862
Adjustments to reconcile net income to net cash provided by operating activities:

Decrease (increase) in premiums receivable

(14,203)

(105,460)
Decrease (increase) in funds held by reinsureds, net

(67,033)

(25,584)
Decrease (increase) in reinsurance recoverables

(125,881)

(14,518)
Decrease (increase) in income taxes

1,251

24,908
Decrease (increase) in prepaid reinsurance premiums

(7,167)

(27,071)
Increase (decrease) in reserve for losses and loss adjustment expenses

632,398

655,070
Increase (decrease) in future policy benefit reserve

(1,146)

(162)
Increase (decrease) in unearned premiums

4,045

196,631
Increase (decrease) in other net payable to reinsurers

46,310

105,390
Increase (decrease) in losses in course of payment

(125,074)

11,980
Change in equity adjustments in limited partnerships

(97,831)

(116,767)
Distribution of limited partnership income

71,174

18,125
Change in other assets and liabilities, net

47,052

(149,480)
Non-cash compensation expense

11,912

11,021
Amortization of bond premium (accrual of bond discount)

19,254

17,323
Net (gains) losses on investments

153,627

(38,902)
Net cash provided by (used in) operating activities

846,439

904,366

CASH FLOWS FROM INVESTING ACTIVITIES:

Proceeds from fixed maturities matured/called - available for sale

849,019

818,352
Proceeds from fixed maturities sold - available for sale

418,988

228,278
Proceeds from equity securities sold, at fair value

90,101

281,313
Distributions from other invested assets

162,719

52,211
Cost of fixed maturities acquired - available for sale

(2,010,859)

(1,776,730)
Cost of equity securities acquired, at fair value

(195,026)

(174,981)
Cost of other invested assets acquired

(137,430)

(98,939)
Net change in short-term investments

354,761

308,585
Net change in unsettled securities transactions

46,399

(93,610)
Net cash provided by (used in) investing activities

(421,328)

(455,521)

CASH FLOWS FROM FINANCING ACTIVITIES:

Common shares issued during the period for share-based compensation, net of expense

(14,450)

(10,583)
Purchase of treasury shares

(1,322)

(23,545)
Dividends paid to shareholders

(61,097)

(62,229)
Cost of shares withheld on settlements of share-based compensation awards

(16,692)

(12,507)
Net cash provided by (used in) financing activities

(93,561)

(108,864)

EFFECT OF EXCHANGE RATE CHANGES ON CASH

5,807

(8,972)

Net increase (decrease) in cash

337,357

331,009
Cash, beginning of period

1,440,861

801,651
Cash, end of period
$
1,778,218

$
1,132,660

SUPPLEMENTAL CASH FLOW INFORMATION:

Income taxes paid (recovered)
$
2,681

$
6,417
Interest paid

2,210

1,880

The accompanying notes are an integral part of the consolidated financial statements.

Three Months Ended
March 31,
(Dollars in millions) 2023 2022
(unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 365 $ 298
Adjustments to reconcile net income to net cash provided by operating activities:
Decrease (increase) in premiums receivable (259) (14)
Decrease (increase) in funds held by reinsureds, net (17) (67)
Decrease (increase) in reinsurance recoverables 7 (126)
Decrease (increase) in income taxes 41 1
Decrease (increase) in prepaid reinsurance premiums 28 (7)
Increase (decrease) in reserve for losses and loss adjustment expenses 681 632
Increase (decrease) in future policy benefit reserve — (1)
Increase (decrease) in unearned premiums 226 4
Increase (decrease) in other net payable to reinsurers 17 46
Increase (decrease) in losses in course of payment 47 (125)
Change in equity adjustments in limited partnerships (5) (98)
Distribution of limited partnership income 48 71
Change in other assets and liabilities, net (121) 47
Non-cash compensation expense 12 12
Amortization of bond premium (accrual of bond discount) (1) 19
Net (gains) losses on investments (5) 154
Net cash provided by (used in) operating activities 1,064 846
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from fixed maturities matured/called/repaid - available for sale 562 849
Proceeds from fixed maturities sold - available for sale 72 419
Proceeds from fixed maturities matured/called/repaid - held to maturity 28 —
Proceeds from equity securities sold 46 90
Distributions from other invested assets 137 163
Cost of fixed maturities acquired - available for sale (1,613) (2,011)
Cost of fixed maturities acquired - held to maturity (11) —
Cost of equity securities acquired (1) (195)
Cost of other invested assets acquired (242) (137)
Net change in short-term investments 4 355
Net change in unsettled securities transactions 267 46
Net cash provided by (used in) investing activities (752) (421)
CASH FLOWS FROM FINANCING ACTIVITIES:
Common shares issued (redeemed) during the period for share-based compensation, net of expense (19) (14)
Purchase of treasury shares — (1)
Dividends paid to shareholders (65) (61)
Cost of shares withheld on settlements of share-based compensation awards (19) (17)
Net cash provided by (used in) financing activities (103) (94)
EFFECT OF EXCHANGE RATE CHANGES ON CASH 3 6
Net increase (decrease) in cash 212 337
Cash, beginning of period 1,398 1,441
Cash, end of period $ 1,610 $ 1,778
SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes paid (recovered) $ 2 $ 3
Interest paid 10 2

The accompanying notes are an integral part of the consolidated financial statements.

Table of Contents

NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS (UNAUDITED)

For the Three Months Ended March 31, ~~2022~~2023 and ~~2021~~

2022

1. GENERAL

Everest Re Group, Ltd. (“Group”), a Bermuda company, through its subsidiaries, principally provides reinsurance and insurance in the U.S., Bermuda and international markets. As used in this document, “Company” means Group and its subsidiaries.

2. BASIS OF PRESENTATION

The unaudited consolidated financial statements of the Company as of March 31, ~~2022~~2023 and December 31, ~~2021~~2022 and for the three months ended March 31, ~~2022~~2023 and ~~2021~~2022 include all adjustments, consisting of normal recurring accruals, which, in the opinion of management, are necessary for a fair statement of the results on an interim basis. Certain financial information, which is normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), has been omitted since it is not required for interim reporting purposes. The December 31, ~~2021~~2022 consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP. The results for the three months ended March 31, ~~2022~~2023 and ~~2021~~2022 are not necessarily indicative of the results for a full year. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the years ended December 31, 2022, 2021 ~~2020~~ and ~~2019,~~2020, included in the Company’s most recent Form 10-K filing.

The Company consolidates the results of operations and financial position of all voting interest entities ("VOE") in which the Company has a controlling financial interest and all variable interest entities ("VIE") in which the Company is considered to be the primary beneficiary. The consolidation assessment, including the determination as to whether an entity qualifies as a VIE or VOE, depends on the facts and circumstances surrounding each entity.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities (and disclosure of contingent assets and liabilities) at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Ultimate actual results could differ, possibly materially, from those estimates.

All intercompany accounts and transactions have been eliminated.

~~Certain reclassifications and format changes have been made to prior years’ amounts to conform to the 2022 presentation.~~

Application of Recently Issued Accounting Standard Changes.

The Company did not adopt any new accounting standards that had a material impact during the three months ended March 31, ~~2022.~~2023. The Company assessed the adoption impacts of recently issued accounting standards by the Financial Accounting Standards Board on the Company’s consolidated financial statements as well as material updates to previous assessments, if any, from the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2021.~~2022. There were no ~~new material~~ accounting standards issued in the three months ended March 31, ~~2022,~~2023, that ~~impacted~~are expected to have a material impact to Group.

~~Any issued guidance and pronouncements, other than those directly referenced above, are deemed by the Company to be either not applicable or immaterial to its financial statements.~~

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3. INVESTMENTS

The ~~following~~ tables ~~show~~below present the amortized cost, allowance for credit losses, gross unrealized appreciation/(depreciation) and market value of fixed maturity securities ~~as of~~- available for sale for the ~~dates~~periods indicated:

At March 31, 2022

Amortized

Allowance for

Unrealized

Unrealized

Market
(Dollars in thousands)
Cost

Credit Losses

Appreciation

Depreciation

Value
Fixed maturity securities

U.S. Treasury securities and obligations of

U.S. government agencies and corporations
$
1,387,723

$
-

$
9,506

$
(41,423)

$
1,355,806

Obligations of U.S. states and political subdivisions

560,375

(151)

9,538

(10,574)

559,188

Corporate securities

7,510,255

(20,049)

64,802

(263,958)

7,291,050

Asset-backed securities

4,046,636

(7,679)

13,228

(54,294)

3,997,891

Mortgage-backed securities

Commercial

1,021,013

-

2,762

(31,904)

991,871

Agency residential

2,387,754

-

5,354

(109,611)

2,283,497

Non-agency residential

5,759

-

-

(114)

5,645

Foreign government securities

1,414,589

-

16,763

(68,970)

1,362,382

Foreign corporate securities

4,358,925

(13,712)

31,776

(225,904)

4,151,085
Total fixed maturity securities
$
22,693,029

$
(41,591)

$
153,729

$
(806,752)

$
21,998,415

At December 31, 2021

Amortized

Allowance for

Unrealized

Unrealized

Market
(Dollars in thousands)
Cost

Credit Losses

Appreciation

Depreciation

Value
Fixed maturity securities

U.S. Treasury securities and obligations of

U.S. government agencies and corporations
$
1,407,256

$
-

$
23,720

$
(10,358)

$
1,420,618

Obligations of U.S. states and political subdivisions

558,842

(151)

29,080

(1,150)

586,621

Corporate securities

7,443,535

(19,267)

195,210

(62,580)

7,556,898

Asset-backed securities

3,579,439

(7,679)

21,817

(11,848)

3,581,729

Mortgage-backed securities

Commercial

1,032,506

-

37,550

(5,690)

1,064,366

Agency residential

2,361,208

-

32,997

(18,873)

2,375,332

Non-agency residential

6,530

-

22

(16)

6,536

Foreign government securities

1,423,634

-

41,957

(28,079)

1,437,512

Foreign corporate securities

4,250,642

(2,641)

95,195

(64,536)

4,278,660
Total fixed maturity securities
$
22,063,592

$
(29,738)

$
477,548

$
(203,130)

$
22,308,272


	At March 31, 2023
(Dollars in millions)	Amortized Cost		Allowance for Credit Losses		Unrealized Appreciation		Unrealized Depreciation		Fair Value
Fixed maturity securities - available for sale
U.S. Treasury securities and obligations of U.S. government agencies and corporations	$	1,323	$	—	$	5	$	(69)	$	1,259
Obligations of U.S. states and political subdivisions	424		—		2		(30)		396
Corporate securities	7,202		(55)		29		(497)		6,679
Asset-backed securities	4,567		—		5		(129)		4,443
Mortgage-backed securities
Commercial	1,075		—		1		(102)		974
Agency residential	3,690		—		19		(244)		3,465
Non-agency residential	5		—		—		(1)		4
Foreign government securities	1,616		—		8		(153)		1,471
Foreign corporate securities	5,345		(7)		22		(491)		4,869
Total fixed maturity securities - available for sale	$	25,247	$	(62)	$	91	$	(1,716)	$	23,560

(Some amounts may not reconcile due to rounding.)


	At December 31, 2022
(Dollars in millions)	Amortized Cost		Allowance for Credit Losses		Unrealized Appreciation		Unrealized Depreciation		Fair Value
Fixed maturity securities - available for sale
U.S. Treasury securities and obligations of U.S. government agencies and corporations	$	1,334	$	—	$	6	$	(82)	$	1,257
Obligations of U.S. states and political subdivisions	444		—		2		(32)		413
Corporate securities	7,044		(45)		31		(561)		6,469
Asset-backed securities	4,229		—		5		(171)		4,063
Mortgage-backed securities
Commercial	1,023		—		—		(105)		919
Agency residential	3,382		—		7		(290)		3,099
Non-agency residential	5		—		—		(1)		4
Foreign government securities	1,586		—		8		(179)		1,415
Foreign corporate securities	5,143		(10)		23		(562)		4,596
Total fixed maturity securities - available for sale	$	24,191	$	(54)	$	81	$	(1,982)	$	22,236

(Some amounts may not reconcile due to rounding.)

The following tables show amortized cost, allowance for credit losses, gross unrealized appreciation/(depreciation) and ~~market~~fair value of fixed maturity securities - held to maturity for the periods indicated:


	At March 31, 2023
(Dollars in millions)	Amortized Cost		Allowance for Credit Losses		Unrealized Appreciation		Unrealized Depreciation		Fair Value
Fixed maturity securities - held to maturity
Corporate securities	$	152	$	(2)	$	1	$	(3)	$	148
Asset-backed securities	640		(6)		1		(12)		624
Mortgage-backed securities
Commercial	14		—		—		—		14
Foreign corporate securities	28		(1)		2		—		29
Total fixed maturity securities - held to maturity	$	834	(9)		$	4	$	(15)	$	814

(Some amounts may not reconcile due to rounding.)

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	At December 31, 2022
(Dollars in millions)	Amortized Cost		Allowance for Credit Losses		Unrealized Appreciation		Unrealized Depreciation		Fair Value
Fixed maturity securities - held to maturity
Corporate securities	$	152	$	(2)	$	—	$	(6)	$	144
Asset-backed securities	661		(6)		2		(15)		642
Mortgage-backed securities
Commercial	7		—		—		—		7
Foreign corporate securities	28		(1)		2		—		28
Total fixed maturity securities - held to maturity	$	848	$	(9)	$	3	$	(22)	$	821

(Some amounts may not reconcile due to rounding.)

The amortized cost and fair value of fixed maturity securities - available for sale are shown in the following table by contractual maturity. ~~Mortgage-backed securities are generally more likely to be prepaid than other fixed maturity securities.~~ As the stated maturity of such securities may not be indicative of actual maturities, the totals for mortgage-backed and asset-backed securities are shown separately.

At March 31, 2022

At December 31, 2021

Amortized

Market

Amortized

Market
(Dollars in thousands)
Cost

Value

Cost

Value
Fixed maturity securities – available for sale:

Due in one year or less
$
1,391,977

$
1,391,679

$
1,398,742

$
1,398,006
Due after one year through five years

7,302,421

7,112,007

7,075,077

7,154,468
Due after five years through ten years

4,896,715

4,673,737

5,003,792

5,100,672
Due after ten years

1,640,754

1,542,088

1,606,298

1,627,163
Asset-backed securities

4,046,636

3,997,891

3,579,439

3,581,729
Mortgage-backed securities:

Commercial

1,021,013

991,871

1,032,506

1,064,366
Agency residential

2,387,754

2,283,497

2,361,208

2,375,332
Non-agency residential

5,759

5,645

6,530

6,536
Total fixed maturity securities
$
22,693,029

$
21,998,415

$
22,063,592

$
22,308,272


	At March 31, 2023				At December 31, 2022
(Dollars in millions)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Fixed maturity securities – available for sale
Due in one year or less	$	1,449	$	1,417	$	1,331	$	1,314
Due after one year through five years	8,385		7,877		8,131		7,546
Due after five years through ten years	4,548		4,072		4,636		4,057
Due after ten years	1,528		1,310		1,454		1,233
Asset-backed securities	4,567		4,443		4,229		4,063
Mortgage-backed securities
Commercial	1,075		974		1,023		919
Agency residential	3,690		3,465		3,382		3,099
Non-agency residential	5		4		5		4
Total fixed maturity securities - available for sale	$	25,247	$	23,560	$	24,191	$	22,236

(Some amounts may not reconcile due to rounding.)

The amortized cost and fair value of fixed maturity securities - held to maturity are shown in the following table by contractual maturity. As the stated maturity of such securities may not be indicative of actual maturities, the totals for mortgage-backed and asset-backed securities are shown separately.


	At March 31, 2023				At December 31, 2022
(Dollars in millions)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Fixed maturity securities – held to maturity
Due in one year or less	$	5	$	5	$	5	$	5
Due after one year through five years	63		63		63		61
Due after five years through ten years	43		42		43		41
Due after ten years	68		67		68		65
Asset-backed securities	640		624		661		642
Mortgage-backed securities
Commercial	14		14		7		7
Total fixed maturity securities - held to maturity	$	834	$	814	$	848	$	821

(Some amounts may not reconcile due to rounding.)

During the third quarter of 2022, the Company re-designated a portion of its fixed maturity securities from its fixed maturity – available for sale portfolio to its fixed maturity – held to maturity portfolio. The fair value of the securities reclassified at the date of transfer was $722 million, net of allowance for current expected credit losses, which was subsequently recognized as the new amortized cost basis. As of March 31, 2023, these securities had an unrealized loss

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of $48 million, which remained in accumulated other comprehensive income on the balance sheet and will be amortized into income through an adjustment to the yields of the underlying securities over the remaining life of the securities.

The Company evaluated fixed maturity securities classified as held to maturity for current expected credit losses as of March 31, 2023 utilizing risk characteristics of each security, including credit rating, remaining time to maturity, adjusted for prepayment considerations, and subordination level, and applying default and recovery rates, which include the incorporation of historical credit loss experience and macroeconomic forecasts, to develop an estimate of current expected credit losses. These fixed maturities classified as held to maturity are of a high credit quality and are all rated investment grade as of March 31, 2023.

The changes in net unrealized appreciation (depreciation) for the Company’s investments are derived from the following sources for the periods indicated:

Three Months Ended

March 31,
(Dollars in thousands)
2022

2021
Increase (decrease) during the period between the market value and cost

of investments carried at market value, and deferred taxes thereon:

Fixed maturity securities and short-term investments
$
(927,407)

$
(322,708)
Change in unrealized appreciation (depreciation), pre-tax

(927,407)

(322,708)
Deferred tax benefit (expense)

116,408

40,427
Change in unrealized appreciation (depreciation),

net of deferred taxes, included in shareholders’ equity
$
(810,999)

$
(292,281)


	Three Months Ended March 31,
(Dollars in millions)	2023		2022
Increase (decrease) during the period between the fair value and cost of investments carried at fair value, and deferred taxes thereon:
Fixed maturity securities - available for sale and short-term investments	$	279	$	(927)
Change in unrealized appreciation (depreciation), pre-tax	279		(927)
Deferred tax benefit (expense)	(30)		116
Change in unrealized appreciation (depreciation), net of deferred taxes, included in shareholders’ equity	$	249	$	(811)

(Some amounts may not reconcile due to rounding.)

The tables below display the aggregate ~~market~~fair value and gross unrealized depreciation of fixed maturity securities - available for sale by security type and contractual maturity, in each case subdivided according to length of time that individual securities had been in a continuous unrealized loss position for the periods ~~indicated.~~

Duration of Unrealized Loss at March 31, 2022 By Security Type

Less than 12 months

Greater than 12 months

Total

Gross

Gross

Gross

Unrealized

Unrealized

Unrealized
(Dollars in thousands)
Market Value

Depreciation

Market Value

Depreciation

Market Value

Depreciation
Fixed maturity securities - available for sale

U.S. Treasury securities and obligations of

U.S. government agencies and corporations
$
735,568

$
(31,508)

$
140,967

$
(9,915)

$
876,535

$
(41,423)
Obligations of U.S. states and political subdivisions

135,080

(8,844)

12,751

(1,683)

147,831

(10,527)
Corporate securities

3,552,799

(191,372)

804,526

(71,842)

4,357,325

(263,214)
Asset-backed securities

3,072,751

(51,294)

41,984

(3,000)

3,114,735

(54,294)
Mortgage-backed securities

Commercial

696,096

(29,358)

19,307

(2,546)

715,403

(31,904)
Agency residential

1,405,047

(67,884)

511,034

(41,727)

1,916,081

(109,611)
Non-agency residential

4,831

(102)

815

(12)

5,646

(114)
Foreign government securities

868,416

(37,826)

173,278

(31,144)

1,041,694

(68,970)
Foreign corporate securities

2,674,129

(177,921)

444,844

(47,682)

3,118,973

(225,603)
Total
$
13,144,717

$
(596,109)

$
2,149,506

$
(209,551)

$
15,294,223

$
(805,660)
Securities where an allowance for credit loss was recorded

18,830

(1,092)

-

-

18,830

(1,092)
Total fixed maturity securities
$
13,163,547

$
(597,201)

$
2,149,506

$
(209,551)

$
15,313,053

$
(806,752)

Duration of Unrealized Loss at March 31, 2022 By Maturity

Less than 12 months

Greater than 12 months

Total

Gross

Gross

Gross

Unrealized

Unrealized

Unrealized
(Dollars in thousands)
Market Value

Depreciation

Market Value

Depreciation

Market Value

Depreciation
Fixed maturity securities

Due in one year or less
$
170,052

$
(2,305)

$
105,909

$
(9,957)

$
275,961

$
(12,262)
Due in one year through five years

3,852,436

(164,170)

755,276

(55,787)

4,607,712

(219,957)
Due in five years through ten years

2,843,780

(178,654)

628,985

(82,375)

3,472,765

(261,029)
Due after ten years

1,099,724

(102,342)

86,196

(14,147)

1,185,920

(116,489)
Asset-backed securities

3,072,751

(51,294)

41,984

(3,000)

3,114,735

(54,294)
Mortgage-backed securities

2,105,974

(97,344)

531,156

(44,285)

2,637,130

(141,629)
Total
$
13,144,717

$
(596,109)

$
2,149,506

$
(209,551)

$
15,294,223

$
(805,660)
Securities where an allowance for credit loss was recorded

18,830

(1,092)

-

-

18,830

(1,092)
Total fixed maturity securities
$
13,163,547

$
(597,201)

$
2,149,506

$
(209,551)

$
15,313,053

$
(806,752)

indicated:


	Duration of Unrealized Loss at March 31, 2023 By Security Type
	Less than 12 months				Greater than 12 months				Total
(Dollars in millions)	Fair Value		Gross Unrealized Depreciation		Fair Value		Gross Unrealized Depreciation		Fair Value		Gross Unrealized Depreciation
Fixed maturity securities - available for sale
U.S. Treasury securities and obligations of U.S. government agencies and corporations	$	359	$	(10)	$	764	$	(59)	$	1,124	$	(69)
Obligations of U.S. states and political subdivisions	113		(6)		119		(22)		232		(28)
Corporate securities	2,358		(89)		3,177		(407)		5,536		(496)
Asset-backed securities	1,644		(37)		1,881		(92)		3,525		(129)
Mortgage-backed securities
Commercial	317		(20)		634		(82)		951		(102)
Agency residential	1,270		(49)		1,373		(195)		2,643		(244)
Non-agency residential	1		—		4		(1)		4		(1)
Foreign government securities	392		(17)		895		(136)		1,287		(153)
Foreign corporate securities	1,504		(67)		2,743		(425)		4,247		(492)
Total	$	7,958	$	(295)	$	11,590	$	(1,419)	$	19,548	$	(1,714)
Securities where an allowance for credit loss was recorded	3		(1)		—		(1)		3		(2)
Total fixed maturity securities - available for sale	$	7,961	$	(296)	$	11,591	$	(1,420)	$	19,551	$	(1,716)

(Some amounts may not reconcile due to rounding.)

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	Duration of Unrealized Loss at March 31, 2023 By Maturity
	Less than 12 months				Greater than 12 months				Total
(Dollars in millions)	Fair Value		Gross Unrealized Depreciation		Fair Value		Gross Unrealized Depreciation		Fair Value		Gross Unrealized Depreciation
Fixed maturity securities - available for sale
Due in one year or less	$	849	$	(14)	$	285	$	(19)	$	1,134	$	(32)
Due in one year through five years	2,342		(86)		4,391		(436)		6,733		(523)
Due in five years through ten years	1,196		(66)		2,308		(422)		3,503		(489)
Due after ten years	339		(22)		715		(172)		1,055		(194)
Asset-backed securities	1,644		(37)		1,881		(92)		3,525		(129)
Mortgage-backed securities	1,588		(70)		2,010		(278)		3,598		(347)
Total	$	7,958	$	(295)	$	11,590	$	(1,419)	$	19,548	$	(1,714)
Securities where an allowance for credit loss was recorded	3		(1)		—		(1)		3		(2)
Total fixed maturity securities - available for sale	$	7,961	$	(296)	$	11,591	$	(1,420)	$	19,551	$	(1,716)

(Some amounts may not reconcile due to rounding.)

The aggregate ~~market~~fair value and gross unrealized losses related to ~~investments~~fixed maturity securities - available for sale in an unrealized loss position at March 31, ~~2022~~2023 were ~~$15.3~~$19.6 billion and ~~$806.8 million,~~$1.7 billion, respectively. The ~~market~~fair value of securities for the single issuer (the United States government), whose securities comprised the largest unrealized loss position at March 31, ~~2022,~~2023, did not exceed ~~4.0%~~4.8% of the overall ~~market~~fair value of the Company’s fixed maturity ~~securities.~~securities available for sale. The ~~market~~fair value of the securities for the issuer with the second largest unrealized loss position at March 31, ~~2022,~~2023, comprised less than ~~0.9%~~0.8% of the Company’s fixed maturity ~~securities.~~securities available for sale. In addition, as indicated on the above table, there was no significant concentration of unrealized losses in any one market sector. The ~~$597.2~~$296 million of unrealized losses related to fixed maturity securities - available for sale that have been in an unrealized loss position for less than one year were generally comprised of domestic and foreign corporate securities, agency residential and commercial mortgage-backed securities, asset-backed securities and foreign government securities. Of these unrealized losses, ~~$551.4~~$263 million were related to securities that were rated investment grade by at least one nationally recognized rating agency. The ~~$209.6 million~~$1.4 billion of unrealized losses related to fixed maturity securities - available for sale in an unrealized loss position for more than one year related primarily to ~~domestic~~foreign and ~~foreign~~domestic corporate securities, agency residential mortgage-backed securities, ~~and~~ foreign government securities and asset-backed securities. Of these unrealized losses, ~~$201.8 million~~$1.3 billion were related to securities that were rated investment grade by at least one nationally recognized rating agency. In all instances, there were no projected cash flow shortfalls to recover the full book value of the investments and the related interest obligations. The mortgage-backed securities still have excess credit coverage and are current on interest and principal payments. Based upon the Company’s current evaluation of securities in an unrealized loss position as of March 31, ~~2022,~~2023, the unrealized losses are due to changes in interest rates and non-issuer specific credit spreads and are not credit-related. In addition, the contractual terms of these securities do not permit these securities to be settled at a price less than their amortized cost.

The Company, given the size of its investment portfolio and capital position, does not have the intent to sell these securities; and it is more likely than not that the Company will not have to sell the security before recovery of its cost basis. In addition, all securities currently in an unrealized loss position are current with respect to principal and interest payments.

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	Duration of Unrealized Loss at December 31, 2022 By Security Type
	Less than 12 months				Greater than 12 months				Total
(Dollars in millions)	Fair Value		Gross Unrealized Depreciation		Fair Value		Gross Unrealized Depreciation		Fair Value		Gross Unrealized Depreciation
Fixed maturity securities - available for sale
U.S. Treasury securities and obligations of U.S. government agencies and corporations	$	668	$	(31)	$	487	$	(52)	$	1,155	$	(82)
Obligations of U.S. states and political subdivisions	235		(23)		27		(9)		261		(32)
Corporate securities	4,143		(326)		1,316		(234)		5,459		(561)
Asset-backed securities	3,204		(142)		456		(29)		3,661		(171)
Mortgage-backed securities
Commercial	806		(90)		101		(15)		907		(105)
Agency residential	1,905		(132)		870		(158)		2,776		(289)
Non-agency residential	4		—		1		(1)		4		—
Foreign government securities	985		(100)		321		(79)		1,306		(179)
Foreign corporate securities	3,264		(372)		853		(189)		4,117		(561)
Total	$	15,213	$	(1,217)	$	4,432	$	(764)	$	19,645	$	(1,982)
Securities where an allowance for credit loss was recorded	2		—		—		—		2		—
Total fixed maturity securities - available for sale	$	15,215	$	(1,217)	$	4,432	$	(764)	$	19,647	$	(1,982)

(Some amounts ~~presented in the tables below include $15.7 million of market value and $(0.4) million of gross unrealized depreciation as of December 31, 2021 related~~may not reconcile due to ~~fixed maturity securities for which the Company has recorded an allowance for credit losses.~~

Duration of Unrealized Loss at December 31, 2021 By Security Type

Less than 12 months

Greater than 12 months

Total

Gross

Gross

Gross

Unrealized

Unrealized

Unrealized
(Dollars in thousands)
Market Value

Depreciation

Market Value

Depreciation

Market Value

Depreciation
Fixed maturity securities - available for sale

U.S. Treasury securities and obligations of

U.S. government agencies and corporations
$
504,168

$
(6,264)

$
91,735

$
(4,094)

$
595,903

$
(10,358)
Obligations of U.S. states and political subdivisions

51,094

(1,038)

2,558

(112)

53,652

(1,150)
Corporate securities

2,132,576

(38,316)

472,831

(24,264)

2,605,407

(62,580)
Asset-backed securities

1,954,079

(11,180)

41,823

(668)

1,995,902

(11,848)
Mortgage-backed securities

Commercial

221,852

(2,854)

40,496

(2,836)

262,348

(5,690)
Agency residential

1,101,215

(12,178)

279,697

(6,695)

1,380,912

(18,873)
Non-agency residential

2,320

(14)

156

(2)

2,476

(16)
Foreign government securities

392,447

(9,709)

100,673

(18,370)

493,120

(28,079)
Foreign corporate securities

1,734,510

(46,247)

210,722

(18,289)

1,945,232

(64,536)
Total fixed maturity securities
$
8,094,261

$
(127,800)

$
1,240,691

$
(75,330)

$
9,334,952

$
(203,130)

rounding.)


	Duration of Unrealized Loss at December 31, 2022 By Maturity
	Less than 12 months				Greater than 12 months				Total
(Dollars in millions)	Fair Value		Gross Unrealized Depreciation		Fair Value		Gross Unrealized Depreciation		Fair Value		Gross Unrealized Depreciation
Fixed maturity securities - available for sale
Due in one year or less	$	989	$	(19)	$	40	$	(7)	$	1,029	$	(26)
Due in one year through five years	4,935		(383)		1,645		(209)		6,580		(592)
Due in five years through ten years	2,698		(360)		911		(230)		3,609		(590)
Due after ten years	672		(91)		408		(116)		1,080		(207)
Asset-backed securities	3,204		(142)		456		(29)		3,661		(171)
Mortgage-backed securities	2,715		(222)		972		(173)		3,687		(395)
Total	$	15,213	$	(1,217)	$	4,432	$	(764)	$	19,645	$	(1,982)
Securities where an allowance for credit loss was recorded	2		—		—		—		2		—
Total fixed maturity securities - available for sale	$	15,215	$	(1,217)	$	4,432	$	(764)	$	19,647	$	(1,982)

Duration of Unrealized Loss at December 31, 2021 By Maturity

Less than 12 months

Greater than 12 months

Total

Gross

Gross

Gross

Unrealized

Unrealized

Unrealized
(Dollars in thousands)
Market Value

Depreciation

Market Value

Depreciation

Market Value

Depreciation
Fixed maturity securities

Due in one year or less
$
129,860

$
(2,415)

$
136,827

$
(11,832)

$
266,687

$
(14,247)
Due in one year through five years

2,165,467

(35,264)

446,247

(28,685)

2,611,714

(63,949)
Due in five years through ten years

1,727,823

(47,413)

244,454

(22,038)

1,972,277

(69,451)
Due after ten years

791,645

(16,482)

50,991

(2,574)

842,636

(19,056)
Asset-backed securities

1,954,079

(11,180)

41,823

(668)

1,995,902

(11,848)
Mortgage-backed securities

1,325,387

(15,046)

320,349

(9,533)

1,645,736

(24,579)
Total fixed maturity securities
$
8,094,261

$
(127,800)

$
1,240,691

$
(75,330)

$
9,334,952

$
(203,130)

(Some amounts may not reconcile due to rounding.)

The aggregate ~~market~~fair value and gross unrealized losses related to fixed maturity - available for sale investments in an unrealized loss position at December 31, ~~2021~~2022 were ~~$9.3~~$19.6 billion and ~~$203.1 million,~~$2.0 billion, respectively. The ~~market~~fair value of securities for the single issuer (the United States government), whose securities comprised the largest unrealized loss position at December 31, ~~2021,~~2022, did not exceed ~~2.7%~~5.2% of the overall ~~market~~fair value of the Company’s fixed maturity ~~securities.~~securities - available for sale. The ~~market~~fair value of the securities for the issuer with the second largest unrealized loss comprised less than ~~0.5%~~0.2% of the Company’s fixed maturity ~~securities.~~securities - available for sale. In addition, as indicated on the above table, there was no significant concentration of unrealized losses in any one market sector. The ~~$127.8 million~~$1.2 billion of unrealized losses related to fixed maturity securities - available for sale that have been in an unrealized loss position for less than one year were generally comprised of domestic and foreign corporate securities, asset-backed securities, agency residential mortgage-backed ~~securities, asset-backed~~ securities and foreign government securities. Of these unrealized losses, ~~$116.2 million~~$1.1 billion were related to securities that were rated investment grade by at least one nationally recognized rating agency. The ~~$75.3~~$764 million of unrealized losses related to fixed maturity securities - available for sale in an unrealized loss position for more than one year related

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primarily to domestic and foreign corporate securities, ~~foreign government~~agency residential mortgage-backed securities and ~~agency residential mortgage-backed~~foreign government securities. Of these unrealized losses, ~~$72.3~~$732 million were related to securities that were rated investment grade by at least one nationally recognized rating agency. In all instances, there were no projected cash flow shortfalls to recover the full book value of the investments and the related interest obligations. The mortgage-backed securities still have excess credit coverage and are current on interest and principal payments.

The components of net investment income are presented in the table below for the periods indicated:

Three Months Ended

March 31,
(Dollars in thousands)
2022

2021
Fixed maturities
$
148,226

$
140,916
Equity securities

4,146

4,838
Short-term investments and cash

159

180
Other invested assets:

Limited partnerships

88,437

114,333
Other

11,831

6,019
Gross investment income before adjustments

252,799

266,286
Funds held interest income (expense)

3,685

7,966
Future policy benefit reserve income (expense)

(222)

(291)
Gross investment income

256,262

273,961
Investment expenses

(13,432)

(13,548)
Net investment income
$
242,830

$
260,413


	Three Months Ended March 31,
(Dollars in millions)	2023		2022
Fixed maturities	$	247	$	148
Equity securities	1		4
Short-term investments and cash	17		—
Other invested assets
Limited partnerships	(15)		88
Other	22		12
Gross investment income before adjustments	272		253
Funds held interest income (expense)	—		4
Future policy benefit reserve income (expense)	—		—
Gross investment income	272		256
Investment expenses	(12)		(13)
Net investment income	$	260	$	243

(Some amounts may not reconcile due to rounding.)

The Company records results from limited partnership investments on the equity method of accounting with changes in value reported through net investment income. The net investment income from limited partnerships is dependent upon the Company’s share of the net asset values of interests underlying each limited partnership. Due to the timing of receiving financial information from these partnerships, the results are generally reported on a one month or quarter lag. If the Company determines there has been a significant

decline in value of a limited partnership during this lag period, a loss will be recorded in the period in which the Company identifies the decline.

The Company had contractual commitments to invest up to an additional ~~$2.5~~$2.7 billion in limited partnerships and private placement loan securities at March 31, ~~2022.~~2023. These commitments will be funded when called in accordance with the partnership and loan agreements, which have investment periods that expire, unless extended, through 2027.

~~2026~~.

~~The~~

During the fourth quarter of 2022, the Company ~~participates in a private placement liquidity sweep facility (“the facility”). The primary purpose~~entered into corporate-owned life insurance policies, which are carried within other invested assets at policy cash surrender value of ~~the facility is to enhance the Company’s return on its short-term investments~~$954 million and ~~cash positions. The facility invests in high quality, short-duration securities and permits daily liquidity. The Company consolidates its participation in the facility. As~~$939 million as of March 31, 2023 and December 31, 2022, ~~the market value of investments in the facility consolidated within the Company’s balance sheets was $773.3 million.~~

respectively.

Variable Interest Entities

The Company is engaged with various special purpose entities and other entities that are deemed to be VIEs primarily as an investor through normal investment activities but also as an investment manager. A VIE is an entity that either has investors that lack certain essential characteristics of a controlling financial interest, such as simple majority kick-out rights, or lacks sufficient funds to finance its own activities without financial support provided by other entities. The Company performs ongoing qualitative assessments of its VIEs to determine whether the Company has a controlling financial interest in the VIE and therefore is the primary beneficiary. The Company is deemed to have a controlling financial interest when it has both the ability to direct the activities that most significantly impact the economic performance of the VIE and the obligation to absorb losses or right to receive benefits from the VIE that could potentially be significant to the VIE. Based on the Company’s assessment, if it determines it is the primary beneficiary, the Company consolidates the VIE in the Company’s Consolidated Financial Statements. As of March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, the Company did not hold any securities for which it is the primary beneficiary.

The Company, through normal investment activities, makes passive investments in general and limited partnerships and other alternative investments. For these non-consolidated VIEs, the Company has determined it is not the primary beneficiary as it has no ability to direct activities that could significantly affect the economic performance of the investments. The Company’s maximum exposure to loss as of March 31, ~~2022~~2023 and December 31, ~~2021~~2022 is limited to the

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total carrying value of ~~$2.9~~$4.2 billion and ~~$2.9~~$4.1 billion, respectively, which are included in general and limited partnerships and other alternative investments in Other Invested Assets in the Company's Consolidated Balance Sheets. As of March 31, ~~2022,~~2023, the Company has outstanding commitments totaling $2.2 billion whereby the Company is committed to fund these investments and may be called by the partnership during the commitment period to fund the purchase of new investments and partnership expenses. These investments are generally of a passive nature in that the Company does not take an active role in management.

In addition, the Company makes passive investments in structured securities issued by VIEs for which the Company is not the manager. These investments are included in asset-backed securities, which includes collateralized loan obligations and are ~~reported in~~classified as fixed maturities, ~~available-for-sale.~~available for sale. The Company has not provided financial or other support with respect to these investments other than its original investment. For these investments, the Company determined it is not the primary beneficiary due to the relative size of the Company’s investment in comparison to the principal amount of the structured securities issued by the VIEs, the level of credit subordination which reduces the Company’s obligation to absorb losses or right to receive benefits and the Company’s inability to direct the activities that most significantly impact the economic performance of the VIEs. The Company’s maximum exposure to loss on these investments is limited to the amount of the Company’s investment.

The components of net gains (losses) on investments are presented in the ~~tables~~table below for the periods indicated:

Three Months Ended

March 31,
(Dollars in thousands)
2022

2021
Fixed maturity securities, market value:

Allowance for credit losses
$
(11,853)

$
(6,977)
Net realized gains (losses) from dispositions

2,799

9,174
Equity securities, fair value:

Net realized gains (losses) from dispositions

(11,787)

6,238
Gains (losses) from fair value adjustments

(136,860)

29,056
Other invested assets

4,152

1,346
Short-term investments gain (loss)

(78)

66
Total net gains (losses) on investments
$
(153,627)

$
38,902

(Some amounts may not reconcile due to rounding.)

Roll Forward of Allowance for Credit Losses

Three Months Ended March 31, 2022

Obligations of

U.S. States

Foreign

Corporate

Asset-Backed

and Political

Corporate

Securities

Securities

Subdivisions

Securities

Total
(Dollars in thousands)

Beginning Balance

$
(19,267)

$
(7,679)

$
(151)

$
(2,641)

$
(29,738)
Credit losses on securities where credit

losses were not previously recorded

(1,929)

-

-

(11,184)

(13,113)
Increases in allowance on previously

impaired securities

-

-

-

-

-
Decreases in allowance on previously

impaired securities

-

-

-

-

-
Reduction in allowance due to disposals

1,147

-

-

113

1,260

Balance as of March 31, 2022

$
(20,049)

$
(7,679)

$
(151)

$
(13,712)

$
(41,591)

Roll Forward of Allowance for Credit Losses

Three Months Ended March 31, 2021

Foreign

Foreign

Corporate

Asset-Backed

Government

Corporate

Securities

Securities

Securities

Securities

Total
(Dollars in thousands)

Beginning Balance
$
(1,220)

$
-

$
(22)

$
(503)

$
(1,745)
Credit losses on securities where credit

losses were not previously recorded

(2,383)

(4,915)

-

-

(7,298)
Increases in allowance on previously

impaired securities

-

-

-

-

-
Decreases in allowance on previously

impaired securities

-

-

-

-

-
Reduction in allowance due to disposals

-

-

22

298

320

Balance as of March 31, 2021
$
(3,603)

$
(4,915)

$
-

$
(205)

$
(8,723)

Three Months Ended
March 31,
(Dollars in millions) 2023 2022
Fixed maturity securities
Allowance for credit losses $ (8) $ (12)
Net realized gains (losses) from dispositions 2 3
Equity securities, fair value
Net realized gains (losses) from dispositions 7 (12)
Gains (losses) from fair value adjustments 4 (137)
Other invested assets — 4
Total net gains (losses) on investments $ 5 $ (154)

(Some amounts may not reconcile due to rounding.)

The following tables provide a roll forward of the Company’s beginning and ending balance of allowance for credit losses for the periods indicated:


	Roll Forward of Allowance for Credit Losses - Fixed Maturities - Available for Sale
	Three Months Ended March 31, 2023
(Dollars in millions)	Corporate Securities		Foreign Corporate Securities		Total
Beginning Balance	$	(45)	$	(10)	$	(54)
Credit losses on securities where credit losses were not previously recorded	(12)		—		(12)
Increases in allowance on previously impaired securities	—		—		—
Decreases in allowance on previously impaired securities	—		—		—
Reduction in allowance due to disposals	2		3		5
Balance, end of period	$	(55)	$	(7)	$	(62)

(Some amounts may not reconcile due to rounding.)

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	Roll Forward of Allowance for Credit Losses - Fixed Maturities - Held to Maturity
	Three Months Ended March 31, 2023
(Dollars in millions)	Corporate Securities		Asset-Backed Securities		Foreign Corporate Securities		Total
Beginning Balance	$	(2)	$	(6)	$	(1)	$	(9)
Credit losses on securities where credit losses were not previously recorded	—		—		—		—
Increases in allowance on previously impaired securities	—		—		—		—
Decreases in allowance on previously impaired securities	—		—		—		—
Reduction in allowance due to disposals	—		—		—		—
Balance, end of period	$	(2)	$	(6)	$	(1)	$	(9)

(Some amounts may not reconcile due to rounding.)


		Roll Forward of Allowance for Credit Losses - Fixed Maturities - Available for Sale
	Three Months Ended March 31, 2022
(Dollars in millions)		Corporate Securities		Asset-Backed Securities		Foreign Corporate Securities		Total
Beginning Balance		$	(19)	$	(8)	$	(3)	$	(30)
Credit losses on securities where credit losses were not previously recorded		(2)		—		(11)		(13)
Increases in allowance on previously impaired securities		—		—		—		—
Decreases in allowance on previously impaired securities		—		—		—		—
Reduction in allowance due to disposals		1		—		—		1
Balance, end of period		$	(20)	$	(8)	$	(14)	$	(42)

(Some amounts may not reconcile due to rounding.)

The proceeds and split between gross gains and losses from dispositions of fixed maturity and equity securities, are presented in the table below for the periods indicated:


	Three Months Ended March 31,
(Dollars in millions)	2023		2022
Proceeds from sales of fixed maturity securities - available for sale	$	72	$	419
Gross gains from dispositions	11		20
Gross losses from dispositions	(9)		(17)

Proceeds from sales of equity securities	$	46	$	90
Gross gains from dispositions	7		4
Gross losses from dispositions	—		(15)

Three Months Ended

March 31,
(Dollars in thousands)
2022

2021
Proceeds from sales of fixed maturity securities
$
418,988

$
228,278
Gross gains from dispositions

20,122

14,864
Gross losses from dispositions

(17,324)

(5,690)

Proceeds from sales of equity securities
$
90,101

$
281,313
Gross gains from dispositions

3,508

12,304
Gross losses from dispositions

(15,294)

(6,066)

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4. RESERVE FOR LOSSES, LAE AND FUTURE POLICY BENEFIT RESERVE

Activity in the reserve for losses and ~~LAE~~loss adjustment expenses (“LAE”) is summarized for the periods indicated:

Three Months Ended

March 31,
(Dollars in thousands)
2022

2021
Gross reserves beginning of period
$
19,009,486

$
16,322,143
Less reinsurance recoverables on unpaid losses

(1,946,365)

(1,843,691)
Net reserves beginning of period

17,063,121

14,478,452

Incurred related to:

Current year

1,790,798

1,713,253
Prior years

(935)

(1,834)
Total incurred losses and LAE

1,789,863

1,711,419

Paid related to:

Current year

307,661

215,302
Prior years

918,834

837,035
Total paid losses and LAE

1,226,495

1,052,337

Foreign exchange/translation adjustment

(121,934)

(5,841)

Net reserves end of period

17,504,555

15,131,694
Plus reinsurance recoverables on unpaid losses

1,991,082

1,882,112
Gross reserves end of period
$
19,495,637

$
17,013,806

(Some amounts may not reconcile due to rounding.)


	Three Months Ended March 31,
	2023		2022
(Dollars in millions)
Gross reserves beginning of period	$	22,065	$	19,009
Less reinsurance recoverables on unpaid losses	(2,105)		(1,946)
Net reserves beginning of period	19,960		17,063

Incurred related to:
Current year	1,966		1,791
Prior years	—		(1)
Total incurred losses and LAE	1,966		1,790

Paid related to:
Current year	684		308
Prior years	641		919
Total paid losses and LAE	1,325		1,226

Foreign exchange/translation adjustment	152		(122)

Net reserves end of period	20,753		17,505
Plus reinsurance recoverables on unpaid losses	2,125		1,991
Gross reserves end of period	$	22,878	$	19,496

(Some amounts may not reconcile due to rounding.)

Current year incurred losses were ~~$1.8~~$2.0 billion and ~~$1.7~~$1.8 billion for the three months ended March 31, ~~2022~~2023 and ~~2021,~~2022, respectively. Gross and net reserves increased for the three months ended March 31, ~~2022,~~2023, reflecting an increase in underlying exposure due to earned premium growth, ~~partially offset by a reduction~~year over year, and an increase of ~~$155.0~~$175 million in 2023 current year ~~catastrophe losses.~~attritional losses compared to 2022.

5. FAIR VALUE

GAAP guidance regarding fair value measurements addresses how companies should measure fair value when they are required to use fair value measures for recognition or disclosure purposes under GAAP and provides a common definition of fair value to be used throughout GAAP. It defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly fashion between market participants at the measurement date. In addition, it establishes a three-level valuation hierarchy for the disclosure of fair value measurements. The valuation hierarchy is based on the transparency of inputs to the valuation of an asset or liability. The level in the hierarchy within which a given fair value measurement falls is determined based on the

lowest level input that is significant to the measurement, with Level 1 being the highest priority and Level 3 being the lowest priority.

The levels in the hierarchy are defined as follows:

Level 1:Inputs to the valuation methodology are observable inputs that reflect unadjusted quoted prices for identical assets or liabilities in an active market;

Level 2:Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument;

Level 3:Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The Company’s fixed maturity and equity securities are primarily managed by third party investment asset managers. The investment asset managers managing publicly traded securities obtain prices from nationally recognized pricing services. These services seek to utilize market data and observations in their evaluation process. They use pricing

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applications that vary by asset class and incorporate available market information and when fixed maturity securities do not trade on a daily basis the services will apply available information through processes such as benchmark curves, benchmarking of like securities, sector groupings and matrix pricing. In addition, they use model processes, such as the Option Adjusted Spread model to develop prepayment and interest rate scenarios for securities that have prepayment features.

The investment asset managers do not make any changes to prices received from either the pricing services or the investment brokers. In addition, the investment asset managers have procedures in place to review the reasonableness of the prices from the service providers and may request verification of the prices. The Company also continually performs quantitative and qualitative analysis of prices, including but not limited to initial and ongoing review of pricing methodologies, review of prices obtained from pricing services and third party investment asset managers, review of pricing statistics and trends, and comparison of prices for certain securities with a secondary price source for reasonableness. No material variances were noted during these price validation procedures. In limited situations, where financial markets are inactive or illiquid, the Company may use its own assumptions about future cash flows and risk-adjusted discount rates to determine fair value. At March 31, ~~2022, $2.1~~2023, $1.7 billion of fixed maturities ~~market value~~ were fair valued using unobservable inputs. The majority of these fixed maturities were valued by investment managers’ valuation committees and many of these fair values were substantiated by valuations from independent third parties. The Company has procedures in place to evaluate these independent third party valuations. At December 31, ~~2021, $2.1~~2022, $1.7 billion of fixed maturities ~~market value~~ were fair valued using unobservable inputs.

The Company internally manages a ~~public equity~~ portfolio of assets which had a fair value at March 31, ~~2022~~2023 and December 31, ~~2021~~2022 of ~~$1.4~~$3.4 billion and ~~$1.3~~$2.7 billion, ~~respectively. During the fourth quarter of 2021, the Company began to internally manage a portfolio~~respectively, primarily comprised of collateralized loan obligations included in asset-backed securities ~~which had a fair value of $2.1 billion~~ and ~~$2.0 billion at March 31, 2022 and December 31, 2021, respectively.~~US treasury fixed maturities. All prices for these securities were obtained from publicly published sources or nationally recognized pricing vendors.

Equity securities denominated in U.S. currency with quoted prices in active markets for identical assets are categorized as Level 1 since the quoted prices are directly observable. Equity securities traded on foreign exchanges are categorized as Level 2 due to the added input of a foreign exchange conversion rate to determine fair ~~or market~~ value. The Company uses foreign currency exchange rates published by nationally recognized sources.

Fixed maturity securities listed in the tables have been categorized as Level 2, since a particular security may not have traded but the pricing services are able to use valuation models with observable market inputs such as

interest rate yield curves and prices for similar fixed maturity securities in terms of issuer, maturity and seniority. For foreign government securities and foreign corporate securities, the fair values provided by the third party pricing services in local currencies, and where applicable, are converted to U.S. dollars using currency exchange rates from nationally recognized sources.

In addition to the valuations from investment managers, some of the fixed maturities with fair values categorized as Level 3 result when prices are not available from the nationally recognized pricing services and are derived using unobservable inputs. The Company will value the securities with unobservable inputs using comparable market information or receive fair values from investment managers. The investment managers may obtain non-binding price quotes for the securities from brokers. The single broker quotes are provided by market makers or broker-dealers who are recognized as market participants in the markets in which they are providing the quotes. The prices received from brokers are reviewed for reasonableness by the third party asset managers and the Company. If the broker quotes are for foreign denominated securities, the quotes are converted to U.S. dollars using currency exchange rates from nationally recognized sources.

The composition and valuation inputs for the presented fixed maturities categories Level 1 and Level 2 are as follows:

•U.S. Treasury securities and obligations of U.S. government agencies and corporations are primarily comprised of U.S. Treasury bonds and the fair value is based on observable market inputs such as quoted prices, reported trades, quoted prices for similar issuances or benchmark yields;

•Obligations of U.S. states and political subdivisions are comprised of state and municipal bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities, benchmark yields and credit spreads;

•Corporate securities are primarily comprised of U.S. corporate and public utility bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities, benchmark yields and credit spreads;

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•Asset-backed and mortgage-backed securities fair values are based on observable inputs such as quoted prices, reported trades, quoted prices for similar issuances or benchmark yields and cash flow models using observable inputs such as prepayment speeds, collateral performance and default spreads;

•Foreign government securities are comprised of global non-U.S. sovereign bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities and models with observable inputs such as benchmark yields and credit spreads and then, where applicable, converted to U.S. dollars using an exchange rate from a nationally recognized source;

•Foreign corporate securities are comprised of global non-U.S. corporate bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities and models with observable inputs such as benchmark yields and credit spreads and then, where applicable, converted to U.S. dollars using an exchange rate from a nationally recognized source.

The following tables present the fair value measurement levels for all assets and liabilities, which the Company has recorded at fair value ~~(fair and market value)~~ as of the periods indicated:


			Fair Value Measurement Using
	March 31, 2023		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(Dollars in millions)
Assets:
Fixed maturities - available for sale
U.S. Treasury securities and obligations of U.S. government agencies and corporations	$	1,259	$	—	$	1,259	$	—
Obligations of U.S. States and political subdivisions	396		—		396		—
Corporate securities	6,679		—		5,970		709
Asset-backed securities	4,443		—		3,422		1,020
Mortgage-backed securities
Commercial	974		—		974		—
Agency residential	3,465		—		3,465		—
Non-agency residential	4		—		4		—
Foreign government securities	1,471		—		1,471		—
Foreign corporate securities	4,869		—		4,853		16
Total fixed maturities - available for sale	23,560		—		21,815		1,745

Equity securities, fair value	250		140		110		—

(Some amounts may not reconcile due to rounding.)

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Fair Value Measurement Using:

Quoted Prices

in Active

Significant

Markets for

Other

Significant

Identical

Observable

Unobservable

Assets

Inputs

Inputs
(Dollars in thousands)

March 31, 2022

(Level 1)

(Level 2)

(Level 3)
Assets:

Fixed maturities, market value

U.S. Treasury securities and obligations of

U.S. government agencies and corporations

$
1,355,806

$
-

$
1,355,806

$
-
Obligations of U.S. States and political subdivisions

559,188

-

559,188

-
Corporate securities

7,291,050

-

6,576,394

714,656
Asset-backed securities

3,997,891

-

2,609,200

1,388,691
Mortgage-backed securities

Commercial

991,871

-

985,981

5,890
Agency residential

2,283,497

-

2,283,497

-
Non-agency residential

5,645

-

5,645

-
Foreign government securities

1,362,382

-

1,362,382

-
Foreign corporate securities

4,151,085

-

4,135,159

15,926
Total fixed maturities, market value

21,998,415

-

19,873,252

2,125,163

Equity securities, fair value

1,780,526

1,698,324

82,202

-

Fair Value Measurement Using:

Quoted Prices

in Active

Significant

Markets for

Other

Significant

Identical

Observable

Unobservable

Assets

Inputs

Inputs
(Dollars in thousands)

December 31, 2021

(Level 1)

(Level 2)

(Level 3)
Assets:

Fixed maturities, market value

U.S. Treasury securities and obligations of

U.S. government agencies and corporations

$
1,420,618

$
-

$
1,420,618

$
-
Obligations of U.S. States and political subdivisions

586,621

-

586,621

-
Corporate securities

7,556,898

-

6,756,324

800,574
Asset-backed securities

3,581,729

-

2,330,448

1,251,281
Mortgage-backed securities

Commercial

1,064,366

-

1,064,366

-
Agency residential

2,375,332

-

2,375,332

-
Non-agency residential

6,536

-

6,536

-
Foreign government securities

1,437,512

-

1,437,512

-
Foreign corporate securities

4,278,660

-

4,262,645

16,015
Total fixed maturities, market value

22,308,272

-

20,240,402

2,067,870

Equity securities, fair value

1,825,908

1,742,367

83,541

-


			Fair Value Measurement Using
(Dollars in millions)	December 31, 2022		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Fixed maturities - available for sale
U.S. Treasury securities and obligations of U.S. government agencies and corporations	$	1,257	$	—	$	1,257	$	—
Obligations of U.S. States and political subdivisions	413		—		413		—
Corporate securities	6,469		—		5,754		715
Asset-backed securities	4,063		—		3,069		994
Mortgage-backed securities
Commercial	919		—		919		—
Agency residential	3,099		—		3,099		—
Non-agency residential	4		—		4		—
Foreign government securities	1,415		—		1,415		—
Foreign corporate securities	4,596		—		4,579		16
Total fixed maturities - available for sale	22,236		—		20,511		1,725

Equity securities, fair value	281		132		150		—

(Some amounts may not reconcile due to rounding.)

In addition, ~~$299.6~~$316 million and ~~$286.6~~$292 million of investments within other invested assets on the consolidated balance sheets as of March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively, are not included within the fair value hierarchy tables as the assets are measured at ~~NAV~~net asset value (“NAV”) as a practical expedient to determine fair value.

The following table presents the activity under Level 3, fair value measurements using significant unobservable inputs for fixed maturities available for sale, for the periods indicated:


		Total Fixed Maturities, Available for Sale
	Three Months Ended March 31, 2023
(Dollars in millions)		Corporate Securities		Asset-Backed Securities		Foreign Corporate		Total
Beginning balance fixed maturities		$	715	$	994	$	16	$	1,725
Total gains or (losses) (realized/unrealized)
Included in earnings		1		—		—		1
Included in other comprehensive income (loss)		(4)		18		—		14
Purchases, issuances and settlements		(3)		9		—		5
Transfers in/(out) of Level 3 and reclassification of securities in/(out) of investment categories		—		—		—		—
Ending balance		$	709	$	1,020	$	16	$	1,745

The amount of total gains or losses for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at the reporting date		$	—	$	—	$	—	$	—

(Some amounts may not reconcile due to rounding.)

Table of Contents


		Total Fixed Maturities, Available for Sale
	Three Months Ended March 31, 2022
(Dollars in millions)		Corporate Securities		Asset-Backed Securities		CMBS		Foreign Corporate		Total
Beginning balance fixed maturities		$	801	$	1,251	$	—	$	16	$	2,068
Total gains or (losses) (realized/unrealized)
Included in earnings		16		—		—		—		16
Included in other comprehensive income (loss)		(4)		(29)		—		—		(33)
Purchases, issuances and settlements		(98)		166		6		—		74
Transfers in/(out) of Level 3 and reclassification of securities in/(out) of investment categories		—		—		—		—		—
Ending balance		$	715	$	1,389	$	6	$	16	$	2,125

The amount of total gains or losses for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at the reporting date		$	—	$	—	$	—	$	—	$	—

(Some amounts may not reconcile due to rounding.)

There were no transfers of assets in/(out) of Level 3 for the three months ended March 31, 2022.

Total Fixed Maturities, Market Value

Three Months Ended March 31, 2022

Three Months Ended March 31, 2021

Corporate

Asset-Backed

Foreign

Corporate

Asset-Backed

Foreign

(Dollars in thousands)

Securities

Securities

CMBS

Corporate

Total

Securities

Securities

Corporate

Total
Beginning balance fixed maturities at market value

$
800,574

$
1,251,281

$
-

$
16,015

$
2,067,870

$
701,492

$
623,033

$
5,699

$
1,330,224
Total gains or (losses) (realized/unrealized)

Included in earnings

15,943

102

-

13

16,058

(1,789)

(4,168)

3

(5,954)
Included in other comprehensive income (loss)

(4,167)

(28,788)

(23)

(61)

(33,039)

2,836

(3,135)

49

(250)
Purchases, issuances and settlements

(97,694)

166,096

5,913

(41)

74,274

2,003

169,630

(153)

171,480
Transfers in and/or (out) of Level 3

-

-

-

-

-

-

-

-

-
Ending balance

$
714,656

$
1,388,691

$
5,890

$
15,926

$
2,125,163

$
704,542

$
785,360

$
5,599

$
1,495,500

The amount of total gains or losses for the period

included in earnings (or changes in net assets)

attributable to the change in unrealized gains

or losses relating to assets still held

at the reporting date

$
318

$
-

$
-

$
-

$
318

$
-

$
-

$
-

$
-

(Some amounts may not reconcile due to rounding.)

Financial Instruments Disclosed, But Not Reported, at Fair Value

Certain financial instruments disclosed, but not reported, at fair value are excluded from the fair value hierarchy tables above. Fair values of fixed maturity securities held to maturity and senior notes can be found within Notes 3 and 11, respectively. Short-term investments are stated at cost, which approximates fair value.

6. EARNINGS PER COMMON SHARE

Basic earnings per share are calculated by dividing net income by the weighted average number of common shares outstanding. Diluted earnings per share reflect the potential dilution that would occur if options granted under various share-based compensation plans were exercised resulting in the issuance of common shares that would participate in the earnings of the entity.

Table of Contents

Net income (loss) per common share has been computed as per below, based upon weighted average common basic and dilutive shares outstanding.


	Three Months Ended March 31,
(Dollars in millions, except per share amounts)		2023			2022
Net income (loss) per share:
Numerator
Net income (loss)		$	365		$	298
Less: dividends declared-common shares and unvested common shares		(65)			(61)
Undistributed earnings		300			237
Percentage allocated to common shareholders (1)		98.7		%	98.7		%
		296			234
Add: dividends declared-common shareholders		64			60
Numerator for basic and diluted earnings per common share		$	360		$	294

Denominator
Denominator for basic earnings per weighted-average common shares		38.7			38.8
Effect of dilutive securities:
Options		—			—
Denominator for diluted earnings per adjusted weighted-average common shares		38.7			38.8

Per common share net income (loss)
Basic		$	9.31		$	7.57
Diluted		$	9.31		$	7.56

(1) Basic weighted-average common shares outstanding		38.7			38.8
Basic weighted-average common shares outstanding and unvested common shares expected to vest		39.2			39.3
Percentage allocated to common shareholders		98.7		%	98.7		%

(Some amounts may not reconcile due to rounding.)

Three Months Ended

March 31,
(Dollars in thousands, except per share amounts)
2022

2021
Net income (loss) per share:

Numerator

Net income (loss)
$
297,751

$
341,862

Less: dividends declared-common shares and unvested common shares

(61,097)

(62,229)

Undistributed earnings

236,653

279,633

Percentage allocated to common shareholders (1)

98.7
%

98.7
%

233,504

276,031

Add: dividends declared-common shareholders

60,282

61,415

Numerator for basic and diluted earnings per common share
$
293,785

$
337,446

Denominator

Denominator for basic earnings per weighted-average common shares

38,823

39,543

Effect of dilutive securities:

Options

14

54

Denominator for diluted earnings per adjusted weighted-average common shares

38,837

39,597

Per common share net income (loss)

Basic
$
7.57

$
8.53

Diluted
$
7.56

$
8.52

⁽¹⁾
Basic weighted-average common shares outstanding

38,823

39,543

Basic weighted-average common shares outstanding and unvested common shares expected to vest

39,347

40,059

Percentage allocated to common shareholders

98.7
%

98.7
%

(Some amounts may not reconcile due to rounding.)

There were ~~0 anti-diluted~~no options outstanding ~~for the three months ended~~as of March 31, ~~2022 and 2021.~~

~~All outstanding options~~2023. Options granted under share-based compensation plans ~~expire on~~have all expired as of September 19, 2022.

7. COMMITMENTS AND CONTINGENCIES

In the ordinary course of business, the Company is involved in lawsuits, arbitrations and other formal and informal dispute resolution procedures, the outcomes of which will determine the Company’s rights and obligations under insurance and reinsurance agreements. In some disputes, the Company seeks to enforce its rights under an agreement or to collect funds owing to it. In other matters, the Company is resisting attempts by others to collect funds or enforce alleged rights. These disputes arise from time to time and are ultimately resolved through both informal and formal means, including negotiated resolution, arbitration and litigation. In all such matters, the Company believes that its positions are legally and commercially reasonable. The Company considers the statuses of these proceedings when determining its reserves for unpaid loss and ~~loss adjustment expenses.~~

LAE.

Aside from litigation and arbitrations related to these insurance and reinsurance agreements, the Company is not a party to any other material litigation or arbitration.

The war in the Ukraine is ongoing and an evolving event. Economic and legal sanctions have been levied against Russia, specific named individuals and entities connected to the Russian government, as well as businesses located in the Russian Federation and/or owned by Russian nationals by numerous countries, including the United States. The significant political and economic uncertainty surrounding the war and associated sanctions have impacted economic and investment markets both within Russia and around the world. To the bestTable of ~~our knowledge at this time, the Company has limited financial exposure related to the Russian invasion of the~~Contents

~~Ukraine. However, given the ongoing nature of the war and the high degree of uncertainty around both exposures and coverage, a reasonable estimation of potential loss is not credible at this time.~~

8. OTHER COMPREHENSIVE INCOME (LOSS)

The following ~~table presents~~tables present the components of comprehensive income (loss) in the consolidated statements of operations for the periods indicated:

Three Months Ended March 31, 2022

Three Months Ended March 31, 2021
(Dollars in thousands)
Before Tax

Tax Effect

Net of Tax

Before Tax

Tax Effect

Net of Tax
Unrealized appreciation (depreciation) ("URA(D)") on securities - non-credit related
$
(932,309)

$
117,132

$
(815,177)

$
(329,166)

$
40,551

$
(288,615)
Reclassification of net realized losses (gains) included in net income (loss)

4,902

(724)

4,178

(3,542)

(124)

(3,666)
Foreign currency translation adjustments

(34,603)

501

(34,102)

(8,988)

(594)

(9,582)
Reclassification of benefit plan liability amortization included in net income (loss)

960

(202)

758

2,586

(543)

2,043
Total other comprehensive income (loss)
$
(961,050)

$
116,707

$
(844,343)

$
(339,110)

$
39,290

$
(299,820)


	Three Months Ended March 31, 2023
(Dollars in millions)	Before Tax		Tax Effect		Net of Tax
Unrealized appreciation (depreciation) ("URA(D)") on securities - non-credit related	$	273	$	(27)	$	246
Reclassification of net realized losses (gains) included in net income (loss)	6		(3)		3
Foreign currency translation adjustments	33		(2)		31
Reclassification of benefit plan liability amortization included in net income (loss)	—		—		—
Total other comprehensive income (loss)	$	312	$	(32)	$	280


	Three Months Ended March 31, 2022
(Dollars in millions)	Before Tax		Tax Effect		Net of Tax
Unrealized appreciation (depreciation) ("URA(D)") on securities - non-credit related	$	(932)	$	117	$	(815)
Reclassification of net realized losses (gains) included in net income (loss)	5		(1)		4
Foreign currency translation adjustments	(35)		1		(34)
Reclassification of benefit plan liability amortization included in net income (loss)	1		—		1
Total other comprehensive income (loss)	$	(961)	$	117	$	(844)

The following table presents details of the amounts reclassified from AOCI for the periods indicated:


	Three Months Ended March 31,				Affected line item within the statements of operations and comprehensive income (loss)
AOCI component	2023		2022
(Dollars in millions)
URA(D) on securities	$	6	$	5		Other net realized capital gains (losses)
	(3)		(1)			Income tax expense (benefit)
	$	3	$	4		Net income (loss)

Benefit plan net gain (loss)	$	—	$	1		Other underwriting expenses
	—		—			Income tax expense (benefit)
	$	—	$	1		Net income (loss)

Table of Contents

Three Months Ended

March 31,

Affected line item within the statements of
AOCI component

2022

2021

operations and comprehensive income (loss)
(Dollars in thousands)

URA(D) on securities

$
4,902

$
(3,542)

Other net realized capital gains (losses)

(724)

(124)

Income tax expense (benefit)

$
4,178

$
(3,666)

Net income (loss)

Benefit plan net gain (loss)

$
960

$
2,586

Other underwriting expenses

(202)

(543)

Income tax expense (benefit)

$
758

$
2,043

Net income (loss)

The following table presents the components of accumulated other comprehensive income (loss), net of tax, in the consolidated balance sheets for the periods indicated:

Three Months Ended

March 31,
(Dollars in thousands)
2022

2021
Beginning balance of URA (D) on securities
$
239,397

$
724,159
Current period change in URA (D) of investments - non-credit related

(810,999)

(292,281)
Ending balance of URA (D) on securities

(571,602)

431,878

Beginning balance of foreign currency translation adjustments

(177,481)

(115,390)
Current period change in foreign currency translation adjustments

(34,102)

(9,582)
Ending balance of foreign currency translation adjustments

(211,583)

(124,972)

Beginning balance of benefit plan net gain (loss)

(50,392)

(73,870)
Current period change in benefit plan net gain (loss)

758

2,043
Ending balance of benefit plan net gain (loss)

(49,634)

(71,827)

Ending balance of accumulated other comprehensive income (loss)
$
(832,820)

$
235,079

(Some amounts may not reconcile due to rounding.)


	Three Months Ended March 31,
(Dollars in millions)	2023		2022
Beginning balance of URA(D) on securities	$	(1,709)	$	239
Current period change in URA(D) of investments - non-credit related	249		(811)
Ending balance of URA(D) on securities	(1,460)		(572)

Beginning balance of foreign currency translation adjustments	(254)		(177)
Current period change in foreign currency translation adjustments	31		(34)
Ending balance of foreign currency translation adjustments	(223)		(212)

Beginning balance of benefit plan net gain (loss)	(33)		(50)
Current period change in benefit plan net gain (loss)	—		1
Ending balance of benefit plan net gain (loss)	(33)		(49)

Ending balance of accumulated other comprehensive income (loss)	$	(1,716)	$	(833)

(Some amounts may not reconcile due to rounding.)

9. CREDIT FACILITIES

The Company has multiple active letter of credit facilities for a total commitment of up to ~~$1.2~~$1.5 billion as of March 31, ~~2022.~~2023. The Company also has additional uncommitted letter of credit facilities of up to ~~$340.0~~$440 million which may be accessible via written request and corresponding authorization from the applicable lender. There is no guarantee the uncommitted capacity will be available to us on a future date.

The terms and outstanding amounts for each facility are discussed below:

~~Group Credit Facility~~

Effective May 26, 2016, Group, Everest Reinsurance (Bermuda), Ltd. (“Bermuda Re”) and Everest International Reinsurance, Ltd. (“Everest International”), both direct subsidiaries of Group, entered into a five year, $800.0 million senior credit facility with a syndicate of lenders, which amended and restated in its entirety the June 22, 2012, four year, $800.0 million senior credit facility. Both the May 26, 2016 and June 22, 2012 senior credit facilities, which have similar terms, are referred to as the “2016 Group Credit Facility”. Wells Fargo Corporation (“Wells Fargo Bank”) is the administrative agent for the 2016 Group Credit Facility.

Effective May 26, 2021, the term of the 2016 Group Credit Facility expired. The Company elected not to renew this facility to allow for the replacement by other collateralized letter of credit facilities such as those described below. As a result of the non-renewal in May 2021, letter of credit commitment/availability in the 2016 Group Credit Facility as of March 31, 2022 is limited only to the remaining $13.3 million of letters of credit currently in force and scheduled to expire in 2022. No additional letters of credit will be issued under the 2016 Group Credit Facility, and the facility will be dormant once the remaining letters of credit have expired. As of March 31, 2022, the Company was in compliance with all Group Credit Facility covenants.

~~The following table summarizes the outstanding letters of credit and/or borrowings for the periods indicated:~~

(Dollars in thousands)

At March 31, 2022

At December 31, 2021
Bank

Commitment

In Use

Date of Expiry

Commitment

In Use

Date of Expiry
Wells Fargo Bank Group Credit Facility

$
13,319

$
13,319

12/30/2022

$
39,198

$
39,198

12/30/2022
Total Wells Fargo Bank Group Credit Facility

$
13,319

$
13,319

$
39,198

$
39,198

Bermuda Re Wells Fargo Bilateral Letter of Credit Facility

Effective February 23, 2021, Bermuda Re entered into a letter of credit issuance facility with Wells Fargo referred to as the “2021 Bermuda Re Wells Fargo Bilateral Letter of Credit Facility.” The Bermuda Re Wells Fargo Bilateral Letter of Credit Facility originally provided for the issuance of up to ~~$50.0~~$50 million of secured letters of credit. Effective May 5, 2021, the agreement was amended to provide for the issuance of up to ~~$500.0~~$500 million of secured letters of credit.

The following table summarizes the outstanding letters of credit for the periods indicated:

(Dollars in thousands)

At March 31, 2022

At December 31, 2021
Bank

Commitment

In Use

Date of Expiry

Commitment

In Use

Date of Expiry
Wells Fargo Bank Bilateral LOC Agreement

$
500,000

$
422,521

12/30/2022

$
500,000

$
351,497

12/30/2022
Total Wells Fargo Bank Bilateral LOC Agreement

$
500,000

$
422,521

$
500,000

$
351,497

(Dollars in millions)

At March 31, 2023

At December 31, 2022

Bank

Commitment

In Use

Date of Expiry

Commitment

In Use

Date of Expiry

Wells Fargo Bank Bilateral LOC Agreement

500

445

12/29/2023

500

463

12/29/2023

(Some amounts may not reconcile due to rounding.)

Bermuda Re Citibank Letter of Credit Facility

Effective August 9, 2021, Bermuda Re entered into a new letter of credit issuance facility with Citibank N.A. which superseded the previous letter of credit issuance facility with Citibank ~~N.A.~~ that was effective December 31, 2020. Both of these ~~agreements~~ are referred to as the “Bermuda Re ~~Citibank~~ Letter of Credit Facility”. The current Bermuda Re Citibank Letter of Credit Facility provides for the committed issuance of up to ~~$230.0~~$230 million

of secured letters of credit. In addition, the facility provided for the uncommitted issuance of up the ~~$140.0~~$140 million, which may be accessible via written request by the Company and corresponding authorization from Citibank N.A.

Table of Contents

The following table summarizes the outstanding letters of credit for the periods indicated:

(Dollars in thousands)

At March 31, 2022

At December 31, 2021
Bank

Commitment

In Use

Date of Expiry

Commitment

In Use

Date of Expiry
Bermuda Re Citibank LOC Facility- Committed

$
230,000

$
425

12/16/22

$
230,000

$
4,425

02/28/22

218,377

12/31/22

925

03/01/22

473

01/21/23

1,264

11/24/22

4,425

02/28/23

423

12/16/22

1,088

03/01/23

146

12/20/22

990

08/15/23

216,622

12/31/22

1,240

09/23/23

473

01/21/23

147

12/20/23

985

08/15/23

–

1,234

09/23/23
Bermuda Re Citibank LOC Facility - Uncommitted

140,000

84,203

12/31/22

140,000

84,203

12/31/22

22,233

03/30/26

22,731

12/30/25
Total Citibank Bilateral Agreement

$
370,000

$
333,600

$
370,000

$
333,429


(Dollars in millions)	At March 31, 2023					At December 31, 2022
Bank	Commitment		In Use		Date of Expiry	Commitment		In Use		Date of Expiry
Bermuda Re Citibank LOC Facility- Committed	$	230	$	1	8/15/2023	$	230	$	1	1/1/2023
	—		3		9/23/2023	—		4		2/28/2023


	—		217		12/31/2023	—		1		3/1/2023

	—		4		2/29/2024	—		1		8/15/2023
	—		1		3/1/2024	—		3		9/23/2023
	—		1		12/1/2024	—		212		12/31/2023
Bermuda Re Citibank LOC Facility - Uncommitted	140		106		12/31/2023	140		87		12/31/2023
	—		18		3/30/2027	—		18		12/30/2026
Total Citibank Bilateral Agreement	$	370	$	353		$	370	$	329

(Some amounts may not reconcile due to rounding.)

Bermuda Re Bayerische Landesbank Bilateral Secured Credit Facility

Effective August 27, 2021 Bermuda Re entered into a letter of credit issuance facility with Bayerische Landesbank, an agreement referred to as the “Bermuda Re Bayerische Landesbank Bilateral ~~LOC~~Secured Credit Facility”. The Bermuda Re Bayerische Landesbank Bilateral ~~LOC~~Secured Credit Facility provides for the committed issuance of up to ~~$200.0~~$200 million of secured letters of credit.

The following table summarizes the outstanding letters of credit for the periods indicated:

(Dollars in millions)

At March 31, 2023

At December 31, 2022

Bank

Commitment

In Use

Date of Expiry

Commitment

In Use

Date of Expiry

Bayerische Landesbank Bilateral Secured Credit Facility

200

175

12/31/2023

200

183

12/31/2023

(Some amounts may not reconcile due to rounding.)

Bermuda Re Bayerische Landesbank Bilateral Unsecured Letter of Credit Facility

Effective December 30, 2022, Bermuda Re entered into a new additional letter of credit issuance facility with Bayerische Landesbank, New York Branch, referred to as the “Bayerische Landesbank Bilateral Unsecured Letter of Credit Facility”. The Bermuda Re Bayerische Landesbank Bilateral Unsecured Letter of Credit Facility provides for the committed issuance of up to $150 million of unsecured letters of credit.

(Dollars in thousands)

At March 31, 2022

At December 31, 2021
Bank

Commitment

In Use

Date of Expiry

Commitment

In Use

Date of Expiry
Bayerische Landesbank Bilateral LOC Agreement

$
200,000

$
156,197

12/31/2022

$
200,000

$
154,691

12/31/2022
Total Bayerische Landesbank Bilateral LOC Agreement

$
200,000

$
156,197

$
200,000

$
154,691

The following table summarizes the outstanding letters of credit for the periods indicated:

(Dollars in millions)

At March 31, 2023

At December 31, 2022

Bank

Commitment

In Use

Date of Expiry

Commitment

In Use

Date of Expiry

Bayerische Landesbank Bilateral Unsecured LOC Agreement - Committed

150

12/31/2023

150

12/31/2023

(Some amounts may not reconcile due to rounding.)

Bermuda Re Lloyd’s Bank Credit ~~Facility.~~

Facility

Effective October 8, 2021 Bermuda Re entered into a letter of credit issuance facility with Lloyd’s Bank Corporate Markets PLC, an agreement referred to as the “Bermuda Re Lloyd’s Bank Credit Facility”. The Bermuda Re Lloyd’s Bank Credit Facility provides for the committed issuance of up to ~~$50.0~~$50 million of secured letters of credit, and subject to credit approval a maximum total facility amount of ~~$250.0~~$250 million.

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The following table summarizes the outstanding letters of credit for the periods indicated:

(Dollars in thousands)

At March 31, 2022

At December 31, 2021
Bank

Commitment

In Use

Date of Expiry

Commitment

In Use

Date of Expiry
Bermuda Re Lloyd's Bank Credit Facility-Committed

$
50,000

$
46,008

12/31/2022

$
50,000

$
46,008

12/31/2022
Bermuda Re Lloyd's Bank Credit Facility-Uncommitted

200,000

84,806

12/31/2022

-

-

Total Bermuda Re Lloyd's Bank Credit Facility

$
250,000

$
130,814

$
50,000

$
46,008


(Dollars in millions)	At March 31, 2023					At December 31, 2022
Bank	Commitment		In Use		Date of Expiry	Commitment		In Use		Date of Expiry
Bermuda Re Lloyd's Bank Credit Facility-Committed	$	50	$	50	12/31/2023	$	50	$	50	12/31/2023
Bermuda Re Lloyd's Bank Credit Facility-Uncommitted	200		156		12/31/2023	200		136		45291
Total Bermuda Re Lloyd's Bank Credit Facility	$	250	$	206		$	250	$	186

(Some amounts may not reconcile due to rounding.)

Bermuda Re Barclays Bank Credit ~~Facility.~~

Facility

Effective November 3, 2021 Bermuda Re entered into a letter of credit issuance facility with Barclays Bank PLC, an agreement referred to as the “Bermuda Re Barclays Credit Facility”. The Bermuda Re Barclays Credit Facility provides for the committed issuance of up to ~~$200.0~~$200 million of secured letters of credit.

The following table summarizes the outstanding letters of credit for the periods indicated:

(Dollars in millions)

At March 31, 2023

At December 31, 2022

Bank

Commitment

In Use

Date of Expiry

Commitment

In Use

Date of Expiry

Bermuda Re Barclays Bilateral Letter of Credit Facility

200

179

12/31/2023

200

179

12/31/2023

Bermuda Re Nordea Bank Letter of Credit Facility

Effective November 21, 2022, Bermuda Re entered into a letter of credit issuance facility with Nordea Bank ABP, New York Branch, referred to as the “Nordea Bank Letter of Credit Facility”. The Bermuda Re Nordea Bank Letter of Credit Facility provides for the committed issuance of up to $200 million of unsecured letters of credit, and subject to credit approval, uncommitted issuance of $100 million for a maximum total facility amount of $300 million.

(Dollars in thousands)

At March 31, 2022

At December 31, 2021
Bank

Commitment

In Use

Date of Expiry

Commitment

In Use

Date of Expiry
Bermuda Re Barclays Bilateral Letter of Credit Facility

$
200,000

$
171,628

12/31/2022

$
200,000

$
186,299

12/31/2022
Total Bermuda Re Barclays Bilateral Letter of Credit Facility

$
200,000

$
171,628

$
200,000

$
186,299

The following table summarizes the outstanding letters of credit for the periods indicated:


(Dollars in millions)	At March 31, 2023					At December 31, 2022
Bank	Commitment		In Use		Date of Expiry	Commitment		In Use		Date of Expiry
Nordea Bank ABP, NY Unsecured LOC Facility - Committed	$	200	$	200	12/31/2023	$	200	$	50	12/31/2023
Nordea Bank ABP, NY Unsecured LOC Facility - Uncommitted	100		100		12/31/2023	100		100		12/31/2023
Total Nordea Bank ABP, NY LOC Facility	$	300	$	300		$	300	$	150

(Some amounts may not reconcile due to rounding.)

Federal Home Loan Bank Membership

Everest Reinsurance Company (“Everest Re”) is a member of the Federal Home Loan Bank of New York (“FHLBNY”), which allows Everest Re to borrow up to 10% of its statutory admitted assets. As of March 31, ~~2022,~~2023, Everest Re had admitted assets of approximately ~~$20.4~~$23.1 billion which provides borrowing capacity of up to approximately ~~$2.0~~$2.3 billion. As of March 31, ~~2022,~~2023, Everest Re has ~~$519.0~~$519 million of borrowings outstanding, ~~with maturities~~all of which expire in ~~November and December, 2022, and interest payable at interest rates between 0.53% and 0.65%.~~2023. Everest Re incurred interest expense of ~~$0.7~~$6 million and ~~$0.3~~$0.7 million for the three months ended March 31, ~~2022~~2023 and ~~2021,~~2022, respectively. The FHLBNY membership agreement requires that 4.5% of borrowed funds be used to acquire additional membership stock.

10. COLLATERALIZED REINSURANCE AND TRUST AGREEMENTS

Certain subsidiaries of Group have established trust agreements, which effectively use the Company’s investments as collateral, as security for assumed losses payable to certain non-affiliated ceding companies. At March 31, 2023, the total

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amount on deposit in trust accounts was $2.5 billion, which includes $202 million of restricted cash. At March 31, 2022, the total amount on deposit in trust accounts was $1.8 ~~billion.~~

billion, which includes $365 million of restricted cash.

The Company reinsures some of its catastrophe exposures with the segregated accounts of Mt. Logan Re. Mt. Logan Re is a Collateralized insurer registered in Bermuda and 100% of the voting common shares are owned by Group. Each segregated account invests predominantly in a diversified set of catastrophe exposures, diversified by risk/peril and across different geographic regions globally.

The following table summarizes the premiums and losses that are ceded by the Company to Mt. Logan Re segregated accounts and assumed by the Company from Mt. Logan Re segregated accounts.

Three Months Ended

March 31,
Mt. Logan Re Segregated Accounts

2022

2021
(Dollars in thousands)

Ceded written premiums

$
50,239

$
99,110
Ceded earned premiums

50,443

78,107
Ceded losses and LAE

40,620

80,843

Assumed written premiums

793

2,476
Assumed earned premiums

793

2,476
Assumed losses and LAE

-

-

Effective April 1, 2018, the Company entered into a retroactive reinsurance transaction with one of the Mt. Logan Re segregated accounts to retrocede $269.2 million of casualty reserves held by Bermuda Re related to accident years 2002 through 2015. As consideration for entering the agreement, the Company transferred cash of $252.0 million to the Mt. Logan Re segregated account. The maximum liability to be retroceded under the agreement will be $319.0 million. The Company will retain liability for any amounts exceeding the maximum liability. As of March 31, 2022 and December 31, 2021, the Company has a reinsurance recoverable of $192.5 million and $206.1 million, respectively. In addition, the Company has a deferred gain liability of $14.4 million and $15.5 million as of March 31, 2022 and December 31, 2021, respectively, reported in other liabilities.


	Three Months Ended March 31,
Mt. Logan Re Segregated Accounts		2023		2022
(Dollars in millions)
Ceded written premiums		$	53	$	50
Ceded earned premiums		46		50
Ceded losses and LAE		36		41

Assumed written premiums		1		1
Assumed earned premiums		1		1
Assumed losses and LAE		—		—

The Company entered into various collateralized reinsurance agreements with Kilimanjaro Re Limited (“Kilimanjaro”), a Bermuda based special purpose reinsurer, to provide the Company with catastrophe reinsurance coverage. These agreements are multi-year reinsurance contracts which cover named storm and earthquake events. The table below summarizes the various agreements.

(Dollars in thousands)

Class

Description

Effective Date

Expiration Date

Limit

Coverage Basis
Series 2017-1 Class A-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/13/2017

4/13/2022

50,000

Aggregate
Series 2017-1 Class B-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/13/2017

4/13/2022

75,000

Aggregate
Series 2017-1 Class C-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/13/2017

4/13/2022

175,000

Aggregate
Series 2018-1 Class A-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/30/2018

5/6/2022

62,500

Aggregate
Series 2018-1 Class B-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/30/2018

5/6/2022

200,000

Aggregate
Series 2018-1 Class A-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/30/2018

5/5/2023

62,500

Aggregate
Series 2018-1 Class B-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/30/2018

5/5/2023

200,000

Aggregate
Series 2019-1 Class A-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

12/12/2019

12/19/2023

150,000

Occurrence
Series 2019-1 Class B-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

12/12/2019

12/19/2023

275,000

Aggregate
Series 2019-1 Class A-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

12/12/2019

12/19/2024

150,000

Occurrence
Series 2019-1 Class B-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

12/12/2019

12/19/2024

275,000

Aggregate
Series 2021-1 Class A-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/21/2025

150,000

Occurrence
Series 2021-1 Class B-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/21/2025

85,000

Aggregate
Series 2021-1 Class C-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/21/2025

85,000

Aggregate
Series 2021-1 Class A-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/20/2026

150,000

Occurrence
Series 2021-1 Class B-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/20/2026

90,000

Aggregate
Series 2021-1 Class C-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/20/2026

90,000

Aggregate

Total available limit as of March 31, 2022

$
2,325,000

(Dollars in millions)

Class

Description

Effective Date

Expiration Date

Limit

Coverage Basis

Series 2018-1 Class A-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/30/2018

5/5/2023

Aggregate

Series 2018-1 Class B-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/30/2018

5/5/2023

200

Aggregate

Series 2019-1 Class A-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

12/12/2019

12/19/2023

150

Occurrence

Series 2019-1 Class B-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

12/12/2019

12/19/2023

275

Aggregate

Series 2019-1 Class A-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

12/12/2019

12/19/2024

150

Occurrence

Series 2019-1 Class B-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

12/12/2019

12/19/2024

275

Aggregate

Series 2021-1 Class A-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/21/2025

150

Occurrence

Series 2021-1 Class B-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/21/2025

Aggregate

Series 2021-1 Class C-1

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/21/2025

Aggregate

Series 2021-1 Class A-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/20/2026

150

Occurrence

Series 2021-1 Class B-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/20/2026

Aggregate

Series 2021-1 Class C-2

US, Canada, Puerto Rico – Named Storm and Earthquake Events

4/8/2021

4/20/2026

Aggregate

Series 2022-1 Class A

US, Canada, Puerto Rico – Named Storm and Earthquake Events

6/22/2022

6/22/2025

300

Aggregate

Total available limit as of March 31, 2023

2,063

Recoveries under these collateralized reinsurance agreements with Kilimanjaro are primarily dependent on estimated industry level insured losses from covered events, as well as the geographic location of the events. The estimated

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industry level of insured losses is obtained from published estimates by an independent recognized authority on insured property losses. ~~Currently,~~As of March 31, 2023, none of the published insured loss estimates for catastrophe events during the applicable covered periods of the various agreements have exceeded the single event retentions or aggregate retentions under the terms of the agreements that would result in a recovery.

Kilimanjaro has financed the various property catastrophe reinsurance coverages by issuing catastrophe bonds to unrelated, external investors. The proceeds from the issuance of the ~~Notes listed below~~catastrophe bonds are held in reinsurance trusts throughout the duration of the applicable reinsurance agreements and invested solely in U.S. government money market funds with a rating of at least “AAAm” by Standard & Poor’s.

(Dollars in thousands)

Note Series

Issue Date

Maturity Date

Amount
Series 2017-1 Class A-2

4/13/2017

4/13/2022

$
50,000
Series 2017-1 Class B-2

4/13/2017

4/13/2022

75,000
Series 2017-1 Class C-2

4/13/2017

4/13/2022

175,000
Series 2018-1 Class A-1

4/30/2018

5/6/2022

62,500
Series 2018-1 Class B-1

4/30/2018

5/6/2022

200,000
Series 2018-1 Class A-2

4/30/2018

5/5/2023

62,500
Series 2018-1 Class B-2

4/30/2018

5/5/2023

200,000
Series 2019-1 Class A-1

12/12/2019

12/19/2023

150,000
Series 2019-1 Class B-1

12/12/2019

12/19/2023

275,000
Series 2019-1 Class A-2

12/12/2019

12/19/2024

150,000
Series 2019-1 Class B-2

12/12/2019

12/19/2024

275,000
Series 2021-1 Class A-1

4/8/2021

4/21/2025

150,000
Series 2021-1 Class B-1

4/8/2021

4/21/2025

85,000
Series 2021-1 Class C-1

4/8/2021

4/21/2025

85,000
Series 2021-1 Class A-2

4/8/2021

4/20/2026

150,000
Series 2021-1 Class B-2

4/8/2021

4/20/2026

90,000
Series 2021-1 Class C-2

4/8/2021

4/20/2026

90,000

$
2,325,000

The catastrophe bonds’ issue date, maturity date and amount correspond to the reinsurance agreements listed above.

11. SENIOR NOTES

The table below displays Everest Reinsurance Holdings’ (“Holdings”) outstanding senior notes. ~~Market~~Fair value is based on quoted market prices, but due to limited trading activity, these senior notes are considered Level 2 in the fair value hierarchy.

March 31, 2022

December 31, 2021

Consolidated Balance

Consolidated Balance

(Dollars in thousands)
Date Issued

Date Due

Principal Amounts

Sheet Amount

Market Value

Sheet Amount

Market Value
4.868% Senior notes
6/5/2014

6/1/2044

$
400,000

$
397,343

$
437,148

$
397,314

$
503,840
3.5% Senior notes
10/7/2020

10/15/2050

1,000,000

980,178

895,420

980,046

1,054,520
3.125% Senior notes
10/4/2021

10/15/2052

1,000,000

968,626

832,780

968,440

983,140

$
2,400,000

$
2,346,147

$
2,165,348

$
2,345,800

$
2,541,500


					March 31, 2023				December 31, 2022
(Dollars in millions)	Date Issued	Date Due	Principal Amounts		Consolidated Balance Sheet Amount		Fair Value		Consolidated Balance Sheet Amount		Fair Value
4.868% Senior notes	6/5/2014	6/1/2044	$	400	$	397	$	373	$	397	$	343
3.5% Senior notes	10/7/2020	10/15/2050	1,000		981		728		981		677
3.125% Senior notes	10/4/2021	10/15/2052	1,000		969		677		969		627
			$	2,400	$	2,348	$	1,778	$	2,347	$	1,647

(Some amounts may not reconcile due to rounding.)

Interest expense incurred in connection with these senior notes is as follows for the periods indicated:

Three Months Ended

March 31,
(Dollars In thousands
2022

2021
Interest expense incurred 4.868% Senior notes
$
4,868

$
4,868
Interest expense incurred 3.5% Senior notes

8,807

8,805
Interest expense incurred 3.125% Senior notes

7,913

-

$
21,588

$
13,673


			Three Months Ended March 31,
(Dollars in millions)	Interest Paid	Payable Dates		2023		2022
4.868% Senior notes	semi-annually	June 1/ December 1		$	5	$	5
3.5% Senior notes	semi-annually	April 15/October 15		9		9
3.125% Senior notes	semi-annually	April 15/October 15		8		8
				$	22	$	22

(Some amounts may not reconcile due to rounding.)

12. ~~LONG TERM~~LONG-TERM SUBORDINATED NOTES

The table below displays Holdings’ outstanding fixed to floating rate ~~long term~~long-term subordinated notes. ~~Market~~Fair value is based on quoted market prices, but due to limited trading activity, these subordinated notes are considered Level 2 in the fair value hierarchy.

Maturity Date

March 31, 2022

December 31, 2021

Original

Consolidated Balance

Market

Consolidated Balance

Market
(Dollars in thousands)
Date Issued

Principal Amount

Scheduled

Final

Sheet Amount

Value

Sheet Amount

Value
Long term subordinated notes
4/26/2007

$
400,000

5/15/2037

5/1/2067

$
223,799

$
208,685

$
223,774

$
216,289

Maturity Date

March 31, 2023

December 31, 2022

(Dollars in millions)

Date Issued

Original
Principal Amount

Scheduled

Final

Consolidated Balance
Sheet Amount

Fair
Value

Consolidated Balance
Sheet Amount

Fair
Value

Long-term subordinated notes

4/26/2007

400

5/15/2037

5/1/2067

218

197

218

187

During the fixed rate interest period from May 3, 2007 through May 14, 2017, interest was at the annual rate of 6.6%, payable semi-annually in arrears on November 15 and May 15 of each year, commencing on November 15, 2007. During the floating rate interest period from May 15, 2017 through maturity, interest will be based on the 3 month LIBOR plus 238.5 basis points, reset quarterly, payable quarterly in arrears on February 15, May 15, August 15 and November 15 of each year, subject to Holdings’ right to defer interest on 1one or more occasions for up to ten consecutive years. Deferred interest will accumulate interest at the applicable rate compounded quarterly for periods from and including May 15, 2017. The reset quarterly interest rate for February ~~16, 2022~~15, 2023 to May ~~15, 2022~~14, 2023 is ~~2.89%~~7.25%.

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Holdings may redeem the ~~long term~~long-term subordinated notes on or after May 15, 2017, in whole or in part at 100% of the principal amount plus accrued and unpaid interest; however, redemption on or after the scheduled maturity date and prior to May 1, 2047 is subject to a replacement capital covenant. This covenant is for the benefit of certain senior note holders and it mandates that Holdings receive proceeds from the sale of another subordinated debt issue, of at least similar size, before it may redeem the subordinated notes. The Company’s 4.868% senior notes, due on June 1, 2044, 3.5% senior notes due on October 15, 2050 and 3.125% senior notes due on October 15, 2052 are the Company’s ~~long term~~long-term indebtedness that ~~ranks~~rank senior to the ~~long term~~long-term subordinated notes.

~~On March 19,~~

In 2009, ~~Group announced~~ the ~~commencement~~Company had reduced its outstanding amount of long-term subordinated notes through the initiation of a cash tender offer for any and all of the ~~6.60% fixed to floating rate long term~~long-term subordinated notes. ~~Upon expiration of the tender offer, the Company had reduced its outstanding debt by $161.4 million. In addition, during 2020, the Company repurchased and retired $13.2 million of the notes.~~

Interest expense incurred in connection with these ~~long term~~long-term subordinated notes is as follows for the periods indicated:

Three Months Ended

March 31,
(Dollars in thousands)
2022

2021
Interest expense incurred
$
1,530

$
1,462


	Three Months Ended March 31,
(Dollars in millions)		2023		2022
Interest expense incurred		$	4	$	2

13. SEGMENT REPORTING

The Reinsurance operation writes worldwide property and casualty reinsurance and specialty lines of business, on both a treaty and facultative basis, through reinsurance brokers, as well as directly with ceding companies. Business is written in the U.S., Bermuda, and Ireland offices, as well as, through branches in Canada, Singapore, the United Kingdom and Switzerland. The Insurance operation writes property and casualty insurance directly and through brokers, surplus lines brokers and general agents within the U.S., Bermuda, Canada, Europe, Singapore and South America through its offices in the U.S., Canada, Chile, Singapore, the United Kingdom, Ireland, and ~~a branch~~branches located in the ~~Netherlands.~~

Netherlands, France, Germany and Spain.

These segments are managed independently, but conform with corporate guidelines with respect to pricing, risk management, control of aggregate catastrophe exposures, capital, investments and support operations. Management generally monitors and evaluates the financial performance of these operating segments based upon their underwriting results.

Underwriting results include earned premium less losses and loss adjustment expenses (“LAE”) incurred, commission and brokerage expenses and other underwriting expenses. The Company measures its underwriting results using ratios, in particular loss, commission and brokerage and other underwriting expense ratios, which, respectively, divide incurred losses, commissions and brokerage and other underwriting expenses by premiums earned.

The Company does not maintain separate balance sheet data for its operating segments. Accordingly, the Company does not review and evaluate the financial results of its operating segments based upon balance sheet data.

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The following tables present the underwriting results for the operating segments for the periods indicated:

Reinsurance
Three Months Ended March 31, 2022

Three Months Ended March 31, 2021
(Dollars in thousands)
Reinsurance

Insurance

Total

Reinsurance

Insurance

Total
Gross written premiums
$
2,185,612

$
1,000,739

$
3,186,351

$
2,059,015

$
872,418

$
2,931,433
Net written premiums

2,081,449

730,564

2,812,013

1,912,950

640,987

2,553,937

Premiums earned
$
2,066,254

$
725,511

$
2,791,765

$
1,777,452

$
610,413

$
2,387,865
Incurred losses and LAE

1,324,716

465,147

1,789,863

1,271,906

439,513

1,711,419
Commission and brokerage

514,243

90,987

605,230

408,724

80,287

489,011
Other underwriting expenses

50,453

110,840

161,293

51,996

90,235

142,231
Underwriting gain (loss)
$
176,842

$
58,537

$
235,379

$
44,826

$
378

$
45,204

Net investment income

242,830

260,413
Net gains (losses) on investments

(153,627)

38,902
Corporate expenses

(14,020)

(12,378)
Interest, fee and bond issue cost amortization expense

(24,078)

(15,639)
Other income (expense)

15,363

56,593
Income (loss) before taxes

$
301,847

$
373,095


	Three Months Ended March 31, 2023
(Dollars in millions)	Reinsurance		Insurance		Total
Gross written premiums	$	2,637	$	1,106	$	3,743
Net written premiums	2,454		875		3,329

Premiums earned	$	2,242	$	858	$	3,100
Incurred losses and LAE	1,411		555		1,966
Commission and brokerage	560		101		661
Other underwriting expenses	63		136		200
Underwriting gain (loss)	$	207	$	66	$	273

Net investment income					260
Net gains (losses) on investments					5
Corporate expenses					(19)
Interest, fee and bond issue cost amortization expense					(32)
Other income (expense)					(79)
Income (loss) before taxes					$	408

~~The Company produces business in the U.S., Bermuda and internationally. The net income deriving from and assets residing in the individual foreign countries in which the Company writes business are~~

(Some amounts may not identifiable in the Company’s financial records. Based on gross written premium, the table below presents the largest country, other than the U.S., in which the Company writes business, for the periods indicated:

Three Months Ended

March 31,
(Dollars in thousands)
2022

2021
United Kingdom gross written premium
$
311,581

$
366,148

reconcile due to rounding.)


	Three Months Ended March 31, 2022
(Dollars in millions)	Reinsurance		Insurance		Total
Gross written premiums	$	2,186	$	1,001	$	3,186
Net written premiums	2,081		731		2,812

Premiums earned	$	2,066	$	726	$	2,792
Incurred losses and LAE	1,325		465		1,790
Commission and brokerage	514		91		605
Other underwriting expenses	50		111		161
Underwriting gain (loss)	$	177	$	59	$	235

Net investment income					243
Net gains (losses) on investments					(154)
Corporate expenses					(14)
Interest, fee and bond issue cost amortization expense					(24)
Other income (expense)					15
Income (loss) before taxes					$	302

~~No other country represented more than 5% of the Company’s revenues.~~

(Some amounts may not reconcile due to rounding.)

14. SHARE-BASED COMPENSATION PLANS

For the three months ended March 31, ~~2022,~~2023, a total of ~~196,808~~174,171 restricted stock ~~awards were granted: 187,760 and 9,048 restricted share~~ awards were granted on February 23, ~~2022 and February 24, 2022,~~2023, with a fair value of ~~$301.535~~$382.385 per ~~share and $287.9425 per share, respectively. Additionally, 18,340~~share. Also, 14,975 performance share unit awards were granted on February 23, ~~2022,~~2023, with a fair value of ~~$301.535~~$382.385 per ~~unit.~~

share.

15. INCOME TAXES

The Company is domiciled in Bermuda and has ~~significant~~ subsidiaries and/or branches in Belgium, Canada, Chile, France, Germany, Ireland, the Netherlands, Singapore, Spain, Switzerland, the United Kingdom, and the United States. The Company’s Bermuda domiciled subsidiaries are exempt from income taxation under Bermuda law until 2035. The Company’s

non-Bermudian subsidiaries and branches are subject to income taxation at varying rates in their respective domiciles.

The Company generally applies the estimated Annualized Effective Tax Rate (“AETR”) approach for calculating its tax provision for interim periods as prescribed by ASC 740-270, Interim Reporting. Under the AETR approach, the estimated annualized effective tax rate is applied to the interim year-to-date pre-tax income/(loss) to determine the income tax

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expense or benefit for the year-to-date period. The tax expense or benefit for the quarter represents the difference between the year-to-date tax expense or benefit for the current year-to-date period less such amount for the immediately preceding year-to-date period. Management considers the impact of all known events in its estimation of the Company’s annual pre-tax income/(loss) and annualized effective tax rate.

16. SUBSEQUENT EVENTS

The Company has evaluated known recognized and non-recognized subsequent events. The Company does not have any subsequent events to report.

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ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

Industry Conditions.

The worldwide ~~reinsurance~~insurance and ~~insurance~~reinsurance businesses are highly competitive, as well as cyclical by product and market. As such, financial results tend to fluctuate with periods of constrained availability, higher rates and stronger profits followed by periods of abundant capacity, lower rates and constrained profitability. Competition in the types of ~~reinsurance~~insurance and ~~insurance~~reinsurance business that we underwrite is based on many factors, including the perceived overall financial strength of the reinsurer or insurer, ratings of the reinsurer or insurer by A.M. Best and/or Standard & Poor’s, underwriting expertise, the jurisdictions where the reinsurer or insurer is licensed or otherwise authorized, capacity and coverages offered, premiums charged, other terms and conditions of the ~~reinsurance~~insurance and ~~insurance~~reinsurance business offered, services offered, speed of claims payment and reputation and experience in lines written. Furthermore, the market impact from these competitive factors related to reinsurance and insurance is generally not consistent across lines of business, domestic and international geographical areas and distribution channels.

We compete in the U.S., Bermuda and international ~~reinsurance~~insurance and ~~insurance~~reinsurance markets with numerous global competitors. Our competitors include independent reinsurance and insurance companies, subsidiaries or affiliates of established worldwide insurance companies, reinsurance departments of certain insurance companies, domestic and international underwriting operations, including underwriting syndicates at Lloyd’s of London and certain government sponsored risk transfer vehicles. Some of these competitors have greater financial resources than we do and have established ~~long term~~long-term and continuing business relationships, which can be a significant competitive advantage. In addition, the lack of strong barriers to entry into the reinsurance business and recently, the securitization of ~~reinsurance~~insurance and ~~insurance~~reinsurance risks through capital markets provide additional sources of potential reinsurance and insurance capacity and competition.

Worldwide insurance and reinsurance market conditions historically have been competitive. Generally, there ~~was~~is ample insurance and reinsurance capacity relative to demand, as well as additional capital from the capital markets through insurance linked financial instruments. These financial instruments such as side cars, catastrophe bonds and collateralized reinsurance funds, provided capital markets with access to insurance and reinsurance risk exposure. The capital markets demand for these products ~~was being~~is primarily driven by ~~a low interest environment and~~ the desire to achieve greater risk diversification and potentially higher returns on their investments. This ~~increased~~ competition ~~was~~ generally ~~having~~has a negative impact on rates, terms and conditions; however, the impact varies widely by market and coverage.

~~The~~ Based on recent competitive behaviors in the insurance and reinsurance industry, ~~continues~~natural catastrophe events and the macroeconomic backdrop, there has been some dislocation in the market which we expect to ~~deal with the impacts of~~have a ~~global pandemic, COVID-19~~positive impact on rates and ~~its subsequent variants. We continue to service~~terms and ~~meet the needs of our clients while ensuring the safety and health of our employees and customers.~~

~~Prior to the pandemic, there was a growing industry consensus that there was some firming of (re)insurance rates for the areas impacted by the recent catastrophes.~~ conditions, generally, though local market specificities can vary.

The increased frequency of catastrophe losses ~~that continued to be~~ experienced ~~in 2022 and~~ throughout ~~2021~~recent years appears to be ~~further~~ pressuring the increase of rates. As business activity continues to regain strength after the pandemic and current macroeconomic uncertainty, rates ~~also~~ appear to be firming in most lines of business, particularly in the casualty lines that had seen significant losses such as excess casualty and directors’ and officers’ liability. Other casualty lines are experiencing modest rate increase, while some lines such as workers’ compensation were experiencing softer market conditions. ~~It is too early to tell what the~~The impact on pricing conditions ~~will be, but it~~ is likely to change depending on the line of business and geography.

While we are unable to predict the full impact the pandemic will have on the insurance industry as it continues to have a negative impact on the global economy, we are well positioned to continue to service our clients.

Our capital position remains a source of strength, with high quality invested assets, significant liquidity and a low operating expense ratio. Our diversified global platform with its broad mix of products, distribution and geography is resilient.

Table of our knowledge at this time, the Company has limited financial exposure related to the Russian invasion of the Ukraine. However, given the ongoing nature of the war and the high degree of uncertainty around both exposures and coverage, a reasonable estimation of potential loss is not credible at this time.Contents

Financial Summary.

We monitor and evaluate our overall performance based upon financial results. The following table displays a summary of the consolidated net income (loss), ratios and shareholders’ equity for the periods indicated.

Three Months Ended

Percentage

March 31,

Increase/
(Dollars in millions)
2022

2021

(Decrease)
Gross written premiums
$
3,186.4

$
2,931.4

8.7
%
Net written premiums

2,812.0

2,553.9

10.1
%

REVENUES:

Premiums earned
$
2,791.8

$
2,387.9

16.9
%
Net investment income

242.8

260.4

-6.8
%
Net gains (losses) on investments

(153.6)

38.9

NM

Other income (expense)

15.4

56.6

-72.9
%
Total revenues

2,896.3

2,743.8

5.6
%

CLAIMS AND EXPENSES:

Incurred losses and loss adjustment expenses

1,789.9

1,711.4

4.6
%
Commission, brokerage, taxes and fees

605.2

489.0

23.8
%
Other underwriting expenses

161.3

142.2

13.4
%
Corporate expenses

14.0

12.4

12.9
%
Interest, fees and bond issue cost amortization expense

24.1

15.6

54.5
%
Total claims and expenses

2,594.5

2,370.7

9.5
%

INCOME (LOSS) BEFORE TAXES

301.8

373.1

-19.1
%
Income tax expense (benefit)

4.1

31.2

-86.9
%
NET INCOME (LOSS)
$
297.8

$
341.9

-12.9
%

RATIOS:

Point Change
Loss ratio

64.1
%

71.7
%

(7.6)

Commission and brokerage ratio

21.7
%

20.5
%

1.2

Other underwriting expense ratio

5.8
%

5.9
%

(0.1)

Combined ratio

91.6
%

98.1
%

(6.5)

At

At

Percentage

March 31,

December 31,

Increase/
(Dollars in millions, except per share amounts)
2022

2021

(Decrease)
Balance sheet data:

Total investments and cash
$
29,298.1

$
29,673.3

-1.3
%
Total assets

37,986.8

38,185.3

-0.5
%
Loss and loss adjustment expense reserves

19,495.6

19,009.5

2.6
%
Total debt

3,088.9

3,088.6

-
%
Total liabilities

28,459.2

28,046.1

1.5
%
Shareholders' equity

9,527.6

10,139.2

-6.0
%
Book value per share

241.52

258.21

-6.5
%

(NM, not meaningful)

(Some amounts may not reconcile due to rounding.)


	Three Months Ended March 31,						Percentage Increase/ (Decrease)
(Dollars in millions)	2023			2022
Gross written premiums	$	3,743		$	3,186		17.5	%
Net written premiums	3,329			2,812			18.4	%

REVENUES:
Premiums earned	$	3,100		$	2,792		11.0	%
Net investment income	260			243			7.0	%
Net gains (losses) on investments	5			(154)			-103.3	%
Other income (expense)	(79)			15			NM
Total revenues	3,286			2,896			13.5	%

CLAIMS AND EXPENSES:
Incurred losses and loss adjustment expenses	1,966			1,790			9.9	%
Commission, brokerage, taxes and fees	661			605			9.3	%
Other underwriting expenses	200			161			23.8	%
Corporate expenses	19			14			34.9	%
Interest, fees and bond issue cost amortization expense	32			24			33.1	%
Total claims and expenses	2,878			2,594			10.9	%

INCOME (LOSS) BEFORE TAXES	408			302			35.0	%
Income tax expense (benefit)	43			4			NM
NET INCOME (LOSS)	$	365		$	298		22.6	%

RATIOS:							Point Change
Loss ratio	63.4		%	64.1		%	(0.7)
Commission and brokerage ratio	21.3		%	21.7		%	(0.4)
Other underwriting expense ratio	6.4		%	5.8		%	0.6
Combined ratio	91.2		%	91.6		%	(0.4)

At
March 31, At
December 31, Percentage
Increase/
(Decrease)
(Dollars in millions, except per share amounts) 2023 2022
Balance sheet data:
Total investments and cash $ 31,435 $ 29,872 5.2 %
Total assets 41,839 39,966 4.7 %
Loss and loss adjustment expense reserves 22,878 22,065 3.7 %
Total debt 3,085 3,084 — %
Total liabilities 32,825 31,525 4.1 %
Shareholders' equity 9,014 8,441 6.8 %
Book value per share 229.49 215.54 6.5 %

(NM, not meaningful)

(Some amounts may not reconcile due to rounding.)

Revenues.

Premiums. Gross written premiums increased by ~~8.7%~~17.5% to $3.7 billion for the three months ended March 31, 2023, compared to $3.2 billion in for the three months ended March 31, 2022, ~~compared to $2.9 billion three months ended March 31, 2021,~~ reflecting a ~~$128.3~~$451 million, or ~~14.7%, increase in our insurance business and a $126.6 million, or 6.1%~~20.6%, increase in our reinsurance ~~business. The rise in insurance premiums was primarily due to increases in specialty casualty~~ business and ~~other specialty~~a $105 million, or 10.5%, increase in our insurance business. The increase in reinsurance premiums was primarily due to increases in casualty pro rata business, property pro rata business and financial lines of

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business. The increase in insurance premiums was primarily due to increases in property/short tail business and other specialty lines of business.

Net written premiums increased by ~~10.1%~~18.4% to $3.3 billion for the three months ended March 31, 2023, compared to $2.8 billion for the three months ended March 31, 2022, ~~compared~~which is consistent with the percentage change in gross written premiums. Premiums earned increased by 11.0% to ~~$2.6~~$3.1 billion ~~for~~during the three months ended March 31, ~~2021. The higher percentage increase in net written premiums~~2023, compared to ~~gross written premiums mainly related to a reduction in business ceded to the segregated accounts of Mt. Logan Re in~~$2.8 billion during the three months ended March 31, 2022 compared to the three months ended March 31, 2021. Premiums earned increased by 16.9% to $2.8 billion for the three months ended March 31, 2022, compared to $2.4 billion for the three months ended March 31, 2021.2022. The change in premiums earned relative to net written premiums iswas primarily the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period. ~~Accordingly, the significant increases in gross written premiums from pro rata business during the latter half of 2021 contributed to the current quarter percentage increase in net earned premiums.~~

Other Income (Expense). We recorded other expense of $79 million and other income of ~~$15.4 million and $56.6~~$15 million for the three months ended March 31, 2023 and 2022, ~~and 2021,~~ respectively. TheThe changes were primarily the result of fluctuations in foreign currency exchange rates. We recognized foreign currency exchange expense of $85 million for the three months ended March 31, 2023 and foreign currency exchange income of ~~$13.1~~$13 million ~~and $51.8 million~~ for the three months ended March 31, ~~2022 and 2021, respectively.~~2022.

Net Investment Income. Refer to Consolidated Investments Results Section below.

Net Gains (Losses) on Investments. Refer to Consolidated Investments Results Section below.

Claims and Expenses.

Incurred Losses and Loss Adjustment Expenses. The following table presents our incurred losses and loss adjustment expenses (“LAE”) for the periods indicated.

Three Months Ended March 31,

Current

Ratio %/

Prior

Ratio %/

Total

Ratio %/
(Dollars in millions)
Year

Pt Change

Years

Pt Change

Incurred

Pt Change
2022

Attritional
$
1,675.8

60.0
%

$
(0.9)

-
%

1,674.9

60.0
%
Catastrophes

115.0

4.1
%

-

-
%

115.0

4.1
%
Total
$
1,790.8

64.1
%

$
(0.9)

-
%

$
1,789.9

64.1
%

2021

Attritional
$
1,443.3

60.4
%

$
(1.8)

-0.1
%

$
1,441.4

60.3
%
Catastrophes

270.0

11.3
%

-

-
%

270.0

11.3
%
Total
$
1,713.3

71.7
%

$
(1.8)

-0.1
%

$
1,711.4

71.7
%

Variance 2022/2021

Attritional
$
232.5

(0.4)
pts

$
0.9

0.1
pts

$
233.5

(0.3)
pts
Catastrophes

(155.0)

(7.2)
pts

-

-
pts

(155.0)

(7.2)
pts
Total
$
77.5

(7.6)
pts

$
0.9

0.1
pts

$
78.5

(7.6)
pts


	Three Months Ended March 31,
(Dollars in millions)	Current Year		Ratio %/ Pt Change		Prior Years		Ratio %/ Pt Change		Total Incurred		Ratio %/ Pt Change
2023
Attritional	$	1,851	59.7	%	$	—	—	%	$	1,851	59.7	%
Catastrophes	115		3.7	%	—		—	%	115		3.7	%
Total	$	1,966	63.4	%	$	—	—	%	$	1,966	63.4	%

2022
Attritional	$	1,676	60.0	%	$	(1)	—	%	$	1,675	60.0	%
Catastrophes	115		4.1	%	—		—	%	115		4.1	%
Total	$	1,791	64.1	%	$	(1)	—	%	$	1,790	64.1	%

Variance 2023/2022
Attritional	$	175	(0.3)	pts	$	1	—	pts	$	176	(0.3)	pts
Catastrophes	—		(0.4)	pts	—		—	pts	—		(0.4)	pts
Total	$	175	(0.7)	pts	$	1	—	pts	$	176	(0.7)	pts

(Some amounts may not reconcile due to rounding.)

Incurred losses and LAE increased by ~~4.6%~~9.9% to $2.0 billion for the three months ended March 31, 2023, compared to $1.8 billion for the three months ended March 31, 2022,~~, compared to $1.7 billion~~ ~~for the three months ended March 31, 2021~~, primarily due to an increase of ~~$232.5~~$175 million in current year attritional ~~losses, partially offset by a decline of $155.0 million in current year catastrophe~~ losses. The increase in current year attritional losses was mainly due to the impact of the increase in premiums earned. The current year catastrophe losses of ~~$115.0~~$115 million for the three months ended March 31, 2023 related primarily to the 2023 Turkey earthquakes ($75.0 million), and the 2023 New Zealand storms ($40.0 million). The $115 million of current year catastrophe losses for the three months ended March 31, 2022 related primarily to the 2022 Australia floods ($75.0 million), the 2022 European storms ($30.0 million), and the 2022 March U.S. storms ($10.0 million). ~~The $270.0 million of current year catastrophe~~

Catastrophe losses and loss expenses typically have a material effect on our incurred losses and loss adjustment expense results and can vary significantly from period to period. Losses from natural catastrophes contributed 3.7 percentage points to the combined ratio for the three months

ended March 31, ~~2021 related~~2023, compared with 4.1 percentage points for the three months ended March 31, 2022. The Company has up to $350.0 million of catastrophe bond protection (“CAT Bond”) that attaches at a $48.1 billion Property Claims Services (“PCS”) Industry loss threshold. This recovery would be recognized on a pro-rata basis up to a $63.8 billion PCS Industry loss level. PCS’s current industry estimate of $48.9 billion issued in April 2023 exceeds the ~~Texas winter storms ($260.0 million) and~~attachment point. The potential recovery under the ~~2021 Australia floods ($10.0 million).~~CAT Bond is currently estimated to

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be $19 million but is subject to further revision of the industry loss estimate. No portion of the potential CAT bond recovery has been included in the Company’s current financial results.

Commission, Brokerage, Taxes and Fees. Commission, brokerage, taxes and fees increased by ~~23.8%~~9.3% to ~~$605.2~~$661 million for the three months ended March 31, ~~2022,~~2023 compared to ~~$489.0~~$605 million for the three months ended March 31, ~~2021.~~2022. The increase was primarily due to the impact of the ~~increases~~increase in premiums earned and changes in the mix of business.

Other Underwriting Expenses. Other underwriting expenses were ~~$161.3~~$200 million and ~~$142.2~~$161 million for the three months ended March 31, ~~2022~~2023 and ~~2021,~~March 31, 2022, respectively. The increase in other underwriting expenses was mainly due to the impact of the increase in premiums earned as well as the continued build out of our insurance operations, including an expansion of the international insurance platform.

Corporate Expenses. Corporate expenses, which are general operating expenses that are not allocated to segments, were ~~$14.0~~$19 million and ~~$12.4~~$14 million for the three months ended March 31, 2023 and 2022, ~~and 2021,~~ respectively. The increase from 2022 to 2023 was mainly due to ~~higher~~ information technology costs and external consulting costs.~~compensation expenses from an increased staff count.~~

Interest, Fees and Bond Issue Cost Amortization Expense. Interest, fees and other bond amortization expense was ~~$24.1~~$32 million and ~~$15.6~~$24 million for the three months ended March 31, 2023 and 2022, ~~and 2021,~~ respectively.~~The increase was primarily due to the issuance of $1.0 billion of senior notes in October 2021.~~ Interest expense was ~~also~~mainly impacted by the ~~movements~~movement in the floating interest rate related to the ~~long term~~long-term subordinated notes, which is reset quarterly per the note ~~agreement. The floating~~agreement, as well as variable interest rate ~~was 2.89% as of March 31, 2022.~~costs on borrowings from FHLB.

Income Tax Expense (Benefit). We had income tax expense of ~~$4.1~~$43 million and ~~$31.2~~$4 million for the three months ended March 31, 2023 and 2022, ~~and 2021~~, respectively. I~~ncome~~Income tax expense is primarily a function of the geographic location of the Company’s pre-tax income and the statutory tax rates in those jurisdictions. The effective tax rate (“ETR”) is primarily affected by tax-exempt investment income, foreign tax credits and dividends. Variations in the ETR generally result from changes in the relative levels of pre-tax income, including the impact of catastrophe losses and net capital gains (losses), among jurisdictions with different tax rates.

On August 16, 2022, the Inflation Reduction Act of 2022 (“IRA”) was enacted. We have evaluated the tax provisions of the IRA, the most significant of which are the corporate alternative minimum tax and the share repurchase excise tax and do not expect the legislation to have a material impact on our results of operations. As the IRS issues additional guidance, we will evaluate any impact to our consolidated financial statements.

Net Income (Loss).

Our net income was ~~$297.8~~$365 million and ~~$341.9~~$298 million for the three months ended March 31, ~~2022~~2023 and ~~2021,~~2022, respectively. These changes were primarily driven by the financial component fluctuations explained above.

Ratios.

Our combined ratio decreased by ~~6.5~~0.4 points to ~~91.6%~~ 91.2% for the three months ended March 31, ~~2022~~,2023, compared to ~~98.1%~~ 91.6% for the three months ended March 31, ~~2021~~.2022. The loss ratio component decreased ~~7.6~~by 0.7 points for the three months ended March 31, ~~2022~~2023 over the same period last year mainly due to ~~a decline~~changes in the mix of ~~$155.0 million~~business and no change in ~~current year~~ catastrophe ~~losses.~~losses despite the considerable increase in gross written premiums. The commission and brokerage ratio components ~~increased~~decreased to ~~21.7%~~ 21.3% for the three months ended March 31, ~~2022~~ 2023 compared to ~~20.5%~~ 21.7% for the three months ended March 31, ~~2021~~ 2022. The decrease was mainly due to changes in the mix of business. The other underwriting expense ratios ~~decreased slightly~~increased to ~~5.8%~~ 6.4% for the three months ended March 31, ~~2022~~ 2023 compared to ~~5.9%~~ 5.8% for the three months ended March 31, ~~2021~~.

2022. These increases were mainly due to higher insurance operations costs.

Shareholders’ Equity.

Shareholders’ equity ~~decreased~~increased by ~~$611.6~~$573 million to ~~$9.5~~$9.0 billion at March 31, ~~2022~~2023 from ~~$10.1~~$8.4 billion at December 31, ~~2021,~~2022, principally as a result of $~~811.0~~ $365 million of net income, $249 million of unrealized ~~depreciation~~appreciation on available for sale fixed maturity portfolio net of tax $~~61.1~~ ~~million of shareholder dividends, $34.1~~and $31 million of net foreign currency translation adjustments, $~~2.5~~ partially offset by $65 million of shareholder dividends and $7 million of share-based compensation ~~transactions and the repurchase of 5,000 common shares for $1.3 million, partially offset by $297.8~~ ~~million of net income and $0.8 million of net benefit plan obligation adjustments, net of tax.~~

transactions.

Consolidated Investment Results

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Net Investment Income.

Net investment income ~~decreased~~increased by ~~6.8%~~7.0% to ~~$242.8 billion~~ $260 million for the three months ended March 31, ~~2022~~ 2023 compared with net investment income of ~~$260.4~~$243 million for the three months ended March 31, ~~2021~~.2022. The ~~decrease~~increase for the three months ended March 31, 2023 was primarily the result of ~~a decline of $25.9 million in limited partnership income, partially offset by an additional $7.3 million of~~higher income from fixed maturity ~~investments.~~investments and short-term investments due to rising reinvestment rates, partially offset by a decline in limited partnership income. The limited partnership income primarily reflects ~~increases~~decreases in their reported net asset values. As such, until these asset values are monetized and the resultant income is distributed, they are subject to future increases or decreases in the asset value, and the results may be volatile.

The following table shows the components of net investment income for the periods indicated.

Three Months Ended

March 31,
(Dollars in millions)
2022

2021
Fixed maturities
$
148.2

$
140.9
Equity securities

4.1

4.8
Short-term investments and cash

0.2

0.2
Other invested assets

Limited partnerships

88.4

114.3
Other

11.8

6.0
Gross investment income before adjustments

252.8

266.3
Funds held interest income (expense)

3.7

8.0
Future policy benefit reserve income (expense)

(0.2)

(0.3)
Gross investment income

256.3

274.0
Investment expenses

(13.4)

(13.5)
Net investment income
$
242.8

$
260.4

(Some amounts may not reconcile due to rounding.)


	Three Months Ended March 31,
(Dollars in millions)	2023		2022
Fixed maturities	$	247	$	148
Equity securities	1		4
Short-term investments and cash	17		—
Other invested assets
Limited partnerships	(15)		88
Other	22		12
Gross investment income before adjustments	272		253
Funds held interest income (expense)	—		4
Future policy benefit reserve income (expense)	—		—
Gross investment income	272		256
Investment expenses	(12)		(13)
Net investment income	$	260	$	243

(Some amounts may not reconcile due to rounding.)

The following table shows a comparison of various investment yields for the periods indicated.

Three Months Ended

March 31,

2022

2021
Annualized pre-tax yield on average cash and invested assets
3.3
%

4.2
%
Annualized after-tax yield on average cash and invested assets
2.9
%

3.7
%
Annualized return on invested assets
1.2
%

4.8
%


	Three Months Ended March 31,
	2023		2022
Annualized pre-tax yield on average cash and invested assets	3.2	%	3.3	%
Annualized after-tax yield on average cash and invested assets	2.8	%	2.9	%
Annualized return on invested assets	3.3	%	1.2	%

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Net Gains (Losses) on Investments.

The following table presents the composition of our net gains (losses) on investments for the periods indicated.

Three Months Ended March 31,
(Dollars in millions)

2022

2021

Variance
Realized gains (losses) from dispositions:

Fixed maturity securities:

Gains
$
20.1

$
14.9

$
5.2
Losses

(17.3)

(5.7)

(11.6)
Total

2.8

9.2

(6.4)

Equity securities, fair value:

Gains

3.5

12.3

(8.8)
Losses

(15.3)

(6.1)

(9.2)
Total

(11.8)

6.2

(18.0)

Other Invested Assets:

Gains

4.5

1.4

3.1
Losses

(0.3)

(0.1)

(0.2)
Total

4.2

1.3

2.9

Short Term Investments:

Gains

-

0.1

(0.1)
Losses

(0.1)

-

(0.1)
Total

(0.1)

0.1

(0.2)

Total net realized gains (losses) from dispositions:

Gains

28.1

28.7

(0.6)
Losses

(33.0)

(11.9)

(21.1)
Total

(4.9)

16.8

(21.7)

Allowance for credit losses:

(11.9)

(7.0)

(4.9)

Gains (losses) from fair value adjustments:

Equity securities, fair value

(136.9)

29.1

(166.0)
Total

(136.9)

29.1

(166.0)

Total net gains (losses) on investments
$
(153.6)

$
38.9

$
(192.5)

(Some amounts may not reconcile due to rounding.)


	Three Months Ended March 31,
(Dollars in millions)	2023		2022		Variance
Realized gains (losses) from dispositions:
Fixed maturity securities - available for sale
Gains	$	11	$	20	$	(9)
Losses	(9)		(17)		8
Total	2		3		(1)

Equity securities
Gains	7		4		4
Losses	—		(15)		15
Total	7		(12)		19

Other Invested Assets
Gains	—		5		(5)
Losses	—		—		—
Total	—		4		(4)

Total net realized gains (losses) from dispositions
Gains	18		28		(10)
Losses	(9)		(33)		24
Total	9		(5)		14

Allowance for credit losses	(8)		(12)		4

Gains (losses) from fair value adjustments
Equity securities	4		(137)		141
Total	4		(137)		141

Total net gains (losses) on investments	$	5	$	(154)	$	159

(Some amounts may not reconcile due to rounding.)

Net gains (losses) on investments during the three months ended March 31, ~~2022~~2023 primarily relate to net ~~losses~~gains from fair value adjustments on equity securities in the amount of ~~$136.9~~$4 million as a result of equity market ~~declines~~increases during the first quarter of ~~2022.~~2023. In addition, we realized $9 million of gains due to the disposition of investments and recorded an increase to the allowance for credit losses ~~during the three months ended March 31, 2022 in the amount~~ of ~~$11.9 million primarily related to our direct holdings of Russian corporate fixed maturity securities.~~

$8 million.

Segment Results.

The Company manages its reinsurance and insurance operations as autonomous units and key strategic decisions are based on the aggregate operating results and projections for these segments of business.

The Reinsurance operation writes worldwide property and casualty reinsurance and specialty lines of business, on both a treaty and facultative basis, through reinsurance brokers, as well as directly with ceding companies. Business is written in the U.S., Bermuda, and Ireland offices, as well as, through branches in Canada, Singapore, the United Kingdom and Switzerland. The Insurance operation writes property and casualty insurance directly and through brokers, surplus lines brokers and general agents within the U.S., Bermuda, Canada, Europe, Singapore and South America through its offices in the U.S., Canada, Chile, Singapore, the United Kingdom, Ireland and ~~a branch~~branches located in the ~~Netherlands.~~

Netherlands, France, Germany and Spain.

Table of Contents

generally monitors and evaluates the financial performance of these operating segments based upon their underwriting results.

Underwriting results include earned premium less ~~losses and loss adjustment expenses (“LAE”)~~LAE incurred, commission and brokerage expenses and other underwriting expenses. We measure our underwriting results using ratios, in particular loss, commission and brokerage and other underwriting expense ratios, which, respectively, divide incurred losses, commissions and brokerage and other underwriting expenses by premiums earned.

Our loss and LAE reserves are management’s best estimate of our ultimate liability for unpaid claims. We re-evaluate our estimates on an ongoing basis, including all prior period reserves, taking into consideration all available information, and in particular, recently reported loss claim experience and trends related to prior periods. Such re-evaluations are recorded in incurred losses in the period in which re-evaluation is made.

The following discusses the underwriting results for each of our segments for the periods indicated.

Reinsurance.

The following table presents the underwriting results and ratios for the Reinsurance segment for the periods indicated.

Three Months Ended March 31,
(Dollars in millions)
2022

2021

Variance

% Change
Gross written premiums
$
2,185.6

$
2,059.0

$
126.6

6.1
%
Net written premiums

2,081.4

1,913.0

168.5

8.8
%

Premiums earned
$
2,066.3

$
1,777.5

$
288.8

16.2
%
Incurred losses and LAE

1,324.7

1,271.9

52.8

4.2
%
Commission and brokerage

514.2

408.7

105.5

25.8
%
Other underwriting expenses

50.5

52.0

(1.5)

-3.0
%
Underwriting gain (loss)
$
176.8

$
44.8

$
132.0

-294.5
%

Point Chg
Loss ratio

64.1
%

71.6
%

(7.5)

Commission and brokerage ratio

24.9
%

23.0
%

1.9

Other underwriting expense ratio

2.4
%

2.9
%

(0.5)

Combined ratio

91.4
%

97.5
%

(6.1)

(NM, Not Meaningful)

(Some amounts may not reconcile due to rounding.)


	Three Months Ended March 31,
(Dollars in millions)	2023			2022			Variance		% Change
Gross written premiums	$	2,637		$	2,186		451		20.6	%
Net written premiums	2,454			2,081			373		17.9	%

Premiums earned	$	2,242		$	2,066		$	176	8.5	%
Incurred losses and LAE	1,411			1,325			86		6.5	%
Commission and brokerage	560			514			46		9.0	%
Other underwriting expenses	63			50			13		25.4	%
Underwriting gain (loss)	$	207		$	177		$	30	17.1	%

									Point Chg
Loss ratio	62.9		%	64.1		%			(1.2)
Commission and brokerage ratio	25.0		%	24.9		%			0.1
Other underwriting expense ratio	2.8		%	2.4		%			0.4
Combined ratio	90.8		%	91.4		%			(0.6)

(NM, Not Meaningful)

(Some amounts may not reconcile due to rounding.)

Premiums. Gross written premiums increased by ~~6.1%~~20.6% to $2.6 billion for the three months ended March 31, 2023 from $2.2 billion for the three months ended March 31, 2022, ~~from $2.1~~primarily due to increases in casualty pro rata business, property pro rata business and financial lines of business. Net written premiums increased by 17.9% to $2.5 billion for the three months ended March 31, ~~2021, primarily due to increases in~~ ~~casualty pro rata business and financial lines of business. Net written premiums increased by 8.8%~~2023 compared to $2.1 billion for the three months ended March 31, 2022, ~~compared~~ which is consistent with the percentage change in gross written premiums. Premiums earned increased by 8.5% to ~~$1.9~~$2.2 billion for the three months ended March 31, ~~2021. The higher percentage increase in net written premiums~~2023, compared to gross written premiums mainly related to a reduction in business ceded to the segregated accounts of Mt. Logan Re in the three months ended March 31, 2022 compared to the three months ended March 31, 2021. ~~Premiums earned increased by 16.2%~~ to $2.1 billion for the three months ended March 31, ~~2022,~~ ~~compared to $1.8 billion~~ ~~for the three months ended March 31, 2021~~.2022. The change in premiums earned relative to net written premiums iswas primarily the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.

~~Accordingly, the significant increases in gross written premiums from pro rata business during the latter half~~Table of ~~2021 contributed to the current quarter percentage increase in net earned premiums.~~Contents

Incurred Losses and LAE. The following table presents the incurred losses and LAE for the Reinsurance segment for the periods indicated.

Three Months Ended March 31,

Current

Ratio %/

Prior

Ratio %/

Total

Ratio %/
(Dollars in millions)
Year

Pt Change

Years

Pt Change

Incurred

Pt Change
2022

Attritional
$
1,216.3

58.9
%

$
(1.6)

-0.1
%

1,214.7

58.8
%
Catastrophes

110.0

5.3
%

-

-
%

110.0

5.3
%
Total Segment
$
1,326.3

64.2
%

$
(1.6)

-0.1
%

$
1,324.7

64.1
%

2021

Attritional
$
1,051.2

59.1
%

$
(1.8)

-0.1
%

1,049.4

59.0
%
Catastrophes

222.5

12.5
%

-

-
%

222.5

12.5
%
Total Segment
$
1,273.7

71.6
%

$
(1.8)

-0.1
%

$
1,271.9

71.6
%

Variance 2022/2021

Attritional
$
165.1

(0.2)
pts

$
0.2

-
pts

$
165.3

(0.2)
pts
Catastrophes

(112.5)

(7.2)
pts

-

-
pts

(112.5)

(7.2)
pts
Total Segment
$
52.6

(7.4)
pts

$
0.2

-
pts

$
52.8

(7.5)
pts


	Three Months Ended March 31,
(Dollars in millions)	Current Year		Ratio %/ Pt Change		Prior Years		Ratio %/ Pt Change		Total Incurred		Ratio %/ Pt Change
2023
Attritional	$	1,298	57.9	%	$	—	—	%	1,298		57.9	%
Catastrophes	113		5.0	%			—	%	113		5.0	%
Total Segment	$	1,411	62.9	%	$	—	—	%	$	1,411	62.9	%

2022
Attritional	$	1,216	58.9	%	$	(2)	-0.1	%	1,215		58.8	%
Catastrophes	110		5.3	%	—		—	%	110		5.3	%
Total Segment	$	1,326	64.2	%	$	(2)	-0.1	%	$	1,325	64.1	%

Variance 2023/2022
Attritional	$	82	(1.0)	pts	$	2	0.1	pts	$	83	(0.9)	pts
Catastrophes	3		(0.3)	pts	—		—	pts	3		(0.3)	pts
Total Segment	$	85	(1.3)	pts	$	2	0.1	pts	$	86	(1.2)	pts

Incurred losses increased by ~~4.2%~~6.5% to ~~$1.32~~$1.4 billion for the three months ended March 31, ~~2022,~~2023, compared to ~~$1.27~~$1.3 billion for the three months ended March 31, ~~2021~~.2022. The increase was primarily due to an increase of ~~$165.1~~$82 million in current year attritional ~~losses, partially offset by a decrease of $112.5 million in current year catastrophe~~ losses. The increase in current year attritional losses was mainly related to the impact of the increase in premiums ~~earned~~.earned. The current year catastrophe losses of ~~$110.0~~$113 million for the three months ended March 31, 2023 related primarily to the 2023 Turkey earthquakes ($75.0 million) and the 2023 New Zealand storms ($38.0 million). The $110 million of current year catastrophe losses for the three months ended March 31, 2022 related primarily to the 2022 Australia floods ($75.0 million), the 2022 European storms ($30.0 million), and the 2022 March U.S. storms ($5.0 million). ~~The $222.5 million of current year catastrophe losses for the three months ended March 31, 2021 related to the Texas winter storms ($212.5 million) and the 2021 Australia floods ($10.0 million).~~

Segment Expenses. Commission and brokerage expense increased by ~~25.8%~~9.0% to ~~$514.2~~$560 million for the three months ended March 31, ~~2022~~ 2023 compared to ~~$408.7~~$514 million for the three months ended March 31, ~~2021~~.2022. The increase was mainly due to the impact of the increase in premiums ~~earned and changes in the mix of business.~~

earned. Segment other underwriting expenses ~~decreased~~increased to ~~$50.5~~$63 million for the three months ended March 31, ~~2022~~ 2023 from ~~$52.0~~$50 million for the three months ended March 31, ~~2021.~~2022. The ~~decrease~~increase was ~~mainly~~ due ~~to lower variable compensation expenses.~~t

o increased personnel and direct and indirect expenditures supporting the increased premium volume of the segment.

Insurance.

The following table presents the underwriting results and ratios for the Insurance segment for the periods indicated.


	Three Months Ended March 31,
(Dollars in millions)	2023		2022		Variance		% Change
Gross written premiums	$	1,106	$	1,001	$	105	10.5	%
Net written premiums	875		731		145		19.7	%

Premiums earned	$	858	$	726	$	133	18.2	%
Incurred losses and LAE	555		465		90		19.4	%
Commission and brokerage	101		91		10		11.1	%
Other underwriting expenses	136		111		25		23.1	%
Underwriting gain (loss)	$	66	$	59	$	7	12.1	%

							Point Chg
Loss ratio	64.7%		64.1%				0.6
Commission and brokerage ratio	11.8%		12.5%				(0.7)
Other underwriting expense ratio	15.9%		15.3%				0.6
Combined ratio	92.4%		91.9%				0.5

(NM not meaningful)

Table of Contents

Three Months Ended March 31,
(Dollars in millions)
2022

2021

Variance

% Change
Gross written premiums
$
1,000.7

$
872.4

$
128.3

14.7
%
Net written premiums

730.6

641.0

89.6

14.0
%

Premiums earned
$
725.5

$
610.4

$
115.1

18.9
%
Incurred losses and LAE

465.1

439.5

25.6

5.8
%
Commission and brokerage

91.0

80.3

10.7

13.3
%
Other underwriting expenses

110.8

90.2

20.6

22.8
%
Underwriting gain (loss)
$
58.5

$
0.4

$
58.2

NM

Point Chg
Loss ratio

64.1
%

72.0
%

(7.9)

Commission and brokerage ratio

12.5
%

13.2
%

(0.7)

Other underwriting expense ratio

15.3
%

14.8
%

0.5

Combined ratio

91.9
%

99.9
%

(8.0)

(NM not meaningful)

(Some amounts may not reconcile due to rounding.)

(Some amounts may not reconcile due to rounding.)

Premiums. Gross written premiums increased by ~~14.7%~~10.5% to ~~$1.0~~$1.1 billion for the three months ended March 31, ~~2022~~ 2023 compared to ~~$872.4 million~~ $1.0 billion for the three months ended March 31, ~~2021. This rise~~2022. The increase in insurance premiums was primarily ~~related~~due to increases in ~~specialty casualty~~property/short tail business and other specialty lines of business. Net written premiums increased by ~~14.0%~~19.7% to ~~$730.6~~$875 million for the three months ended March 31, ~~2022~~ 2023 compared to ~~$641.0~~$731 million for the three months ended March 31, ~~2021, which is consistent with~~ ~~the~~2022. The higher percentage change in net written premiums compared to gross written ~~premiums.~~premiums is due to higher net retention resulting from changes in the mix of business. Premiums earned increased ~~18.9%~~18.2% to ~~$725.5~~$858 million for the three months ended March 31, ~~2022~~ 2023 compared to ~~$610.4~~$726 million for the three months ended March 31, ~~2021~~2022.. The change in premiums earned relative to net written premiums is the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period. ~~Accordingly, the significant increases in gross written premiums during the latter half of 2021 contributed to the current quarter percentage increase in net earned premiums.~~

Incurred Losses and LAE. The following table presents the incurred losses and LAE for the Insurance segment for the periods indicated.

Three Months Ended March 31,

Current

Ratio %/

Prior

Ratio %/

Total

Ratio %/
(Dollars in millions)
Year

Pt Change

Years

Pt Change

Incurred

Pt Change
2022

Attritional
$
459.5

63.3
%

$
0.7

0.1
%

460.1

63.4
%
Catastrophes

5.0

0.7
%

-

-
%

5.0

0.7
%
Total Segment
$
464.5

64.0
%

$
0.7

0.1
%

$
465.1

64.1
%

2021

Attritional
$
392.0

64.2
%

$
-

-
%

$
392.0

64.2
%
Catastrophes

47.5

7.8
%

-

-
%

47.5

7.8
%
Total Segment
$
439.5

72.0
%

$
-

-
%

$
439.5

72.0
%

Variance 2022/2021

Attritional
$
67.5

(0.9)
pts

$
0.7

0.1
pts

$
68.1

(0.8)
pts
Catastrophes

(42.5)

(7.1)
pts

-

-
pts

(42.5)

(7.1)
pts
Total Segment
$
25.0

(8.0)
pts

$
0.7

0.1
pts

$
25.6

(7.9)
pts

(Some amounts may not reconcile due to rounding.)


	Three Months Ended March 31,
(Dollars in millions)	Current Year		Ratio %/ Pt Change		Prior Years		Ratio %/ Pt Change		Total Incurred		Ratio %/ Pt Change
2023
Attritional	$	553	64.5	%	$	—	—	%	553		64.5	%
Catastrophes	2		0.2	%	—		—	%	2		0.2	%
Total Segment	$	555	64.7	%	$	—	—	%	$	555	64.7	%

2022
Attritional	$	460	63.3	%	$	1	0.1	%	460		63.4	%
Catastrophes	5		0.7	%	—		—	%	5		0.7	%
Total Segment	$	465	64.0	%	$	1	0.1	%	$	465	64.1	%

Variance 2023/2022
Attritional	$	94	1.2	pts	$	(1)	(0.1)	pts	$	93	1.1	pts
Catastrophes	(3)		(0.5)	pts	—		—	pts	(3)		(0.5)	pts
Total Segment	$	91	0.7	pts	$	(1)	(0.1)	pts	$	90	0.6	pts

(Some amounts may not reconcile due to rounding.)

Incurred losses and LAE increased by ~~5.8%~~19.4% to ~~$465.1~~$555 million for the three months ended March 31, ~~2022~~2023 compared to ~~$439.5~~$465 million for the three months ended March 31, ~~2021~~.2022. The increase was mainly due to an

increase of ~~$67.5~~$94 million in current year attritional ~~losses, partially offset by a decrease in current year catastrophe losses of $42.5 million.~~losses. The increase in current year attritional losses was primarily due to the impact of the increase in premiums earned. The current year catastrophe losses of ~~$5.0~~$2 million related to the ~~2022 March U.S. storms~~.2023 New Zealand storms. The ~~$47.5~~$5 million of current year catastrophe losses for the three months ended March 31, ~~2021~~ 2022 related to the ~~Texas winter~~2022 March U.S. storms.

Segment Expenses. Commission and brokerage increased by ~~13.3%~~11.1% to ~~$91.0~~$101 million for the three months ended March 31, ~~2022~~2023 compared to ~~$80.3~~$91 million for the three months ended March 31, ~~2021. The increase was mainly due to the impact of the increase in premiums earned.~~

2022. Segment other underwriting expenses increased to ~~$110.8~~$136 million for the three months ended March 31, ~~2022~~2023 compared to ~~$90.2~~$111 million for the three months ended March 31, ~~2021.~~2022. The ~~increase was~~increases were mainly due to the impact of the increase in premiums earned and increased expenses related to the continued build out of the insurance business, including an expansion of the international insurance platform.

FINANCIAL CONDITION

Investments. Total investments were ~~$27.5~~$29.8 billion at March 31, ~~2022, a decrease~~2023, an increase of ~~$712.6 million~~$1.3 billion compared to ~~$28.2~~$28.5 billion at December 31, ~~2021. This decrease~~2022. The rise in investments was primarily related to ~~declines~~an increase in fixed ~~maturity securities and short-term investments. Fixed maturity securities decreased~~maturities, available for sale due to ~~decreases in fair values resulting from higher interest rates, partially offset by~~an overall net ~~purchases~~purchase of ~~securities. Short-term investments decreased as a result~~$1.0 billion of ~~the reinvestment of funds related to the settlement of affiliated reinsurance agreements~~fixed maturities, available for sale during the ~~three months ended March 31, 2022.~~first quarter of 2023.

The Company’s limited partnership investments are comprised of limited partnerships that invest in private ~~equities.~~equity, private credit and private real estate. Generally, the limited partnerships are reported on a month or quarter lag. We receive annual audited financial statements for all of the limited partnerships which are prepared using fair value accounting in accordance with FASB guidance. For the quarterly reports, the Company reviews the financial reports for

Table of Contents

any unusual changes in carrying value. If the Company becomes aware of a significant decline in value during the lag reporting period, the loss will be recorded in the period in which the Company identifies the decline.

The table below ~~summarize~~summarizes the composition and characteristics of our investment portfolio ~~as of~~for the ~~dates~~periods indicated.

At

At

March 31, 2022

December 31, 2021
Fixed income portfolio duration (years)
3.1

3.2

Fixed income composite credit quality
A+

A+


	At March 31, 2023	At December 31, 2022
Fixed income portfolio duration (years)	3.0	3.1
Fixed income composite credit quality	A+	A+

Reinsurance Recoverables.

Reinsurance recoverables for both paid and unpaid losses totaled ~~$2.1~~$2.3 billion and ~~$2.1~~$2.2 billion at March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively. At March 31, ~~2022, $649.0~~2023, $500 million, or ~~30.9%~~21.6%, was receivable from Mt. Logan Re collateralized segregated accounts; ~~$224.1~~$269 million, or ~~10.7%~~11.7%, was receivable from Munich Reinsurance America, Inc. (“Munich Re”) and ~~$123.5~~$135 million, or ~~5.9%~~5.8% was receivable from Endurance Specialty Holdings, Ltd. (“Endurance”). No other retrocessionaire accounted for more than 5% of our recoverables.

Loss and LAE Reserves. Gross loss and LAE reserves totaled ~~$19.5~~$22.9 billion and ~~$19.0~~$22.1 billion at March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively.

The following tables summarize gross outstanding loss and LAE reserves by segment, classified by case reserves and IBNR reserves, for the periods indicated.

At March 31, 2022

Case

IBNR

Total

% of
(Dollars in millions)
Reserves

Reserves

Reserves

Total
Reinsurance
$
5,639.4

$
8,480.4

$
14,119.8

72.4
%
Insurance

1,570.3

3,652.5

5,222.8

26.8
%
Total excluding A&E

7,209.6

12,132.9

19,342.5

99.2
%
A&E

148.4

4.8

153.1

0.8
%
Total including A&E
$
7,358.0

$
12,137.7

$
19,495.6

100.0
%

(Some amounts may not reconcile due to rounding.)

At December 31, 2021

Case

IBNR

Total

% of
(Dollars in millions)
Reserves

Reserves

Reserves

Total
Reinsurance
$
5,415.0

$
8,312.3

$
13,727.3

72.2
%
Insurance

1,546.2

3,562.4

5,108.6

26.9
%
Total excluding A&E

6,961.2

11,874.7

18,835.9

99.1
%
A&E

163.7

9.9

173.6

0.9
%
Total including A&E
$
7,124.8

$
11,884.7

$
19,009.5

100.0
%

(Some amounts may not reconcile due to rounding.)


	At March 31, 2023
(Dollars in millions)	Case Reserves		IBNR Reserves		Total Reserves		% of Total
Reinsurance	$	6,186	$	10,329	$	16,515	72.2	%
Insurance	1,842		4,250		6,093		26.6	%
Total excluding A&E	8,028		14,579		22,607		98.8	%
A&E	132		139		271		1.2	%
Total including A&E	$	8,160	$	14,718	$	22,878	100.0	%

(Some amounts may not reconcile due to rounding.)


	At December 31, 2022
(Dollars in millions)	Case Reserves		IBNR Reserves		Total Reserves		% of Total
Reinsurance	$	6,045	$	9,818	$	15,862	71.9	%
Insurance	1,863		4,062		5,925		26.9	%
Total excluding A&E	7,908		13,880		21,787		98.7	%
A&E	138		140		278		1.3	%
Total including A&E	$	8,046	$	14,019	$	22,065	100.0	%

(Some amounts may not reconcile due to rounding.)

Changes in premiums earned and business mix, reserve re-estimations, catastrophe losses and changes in catastrophe loss reserves and claim settlement activity all impact loss and LAE reserves by segment and in total.

Our carried loss and LAE reserves represent management’s best estimate of our ultimate liability for unpaid claims. We continuously re-evaluate our reserves, including re-estimates of prior period reserves, taking into consideration all available information and, in particular, newly reported loss and claim experience. Changes in reserves resulting from such re-evaluations are reflected in incurred losses in the period when the re-evaluation is made. Our analytical methods and processes operate at multiple levels including individual contracts, groupings of like contracts, classes and lines of business, internal business units, segments, accident years, legal entities, and in the aggregate. In order to set appropriate reserves, we make qualitative and quantitative analyses and judgments ~~at these various levels. Additionally, the attribution of reserves, changes in reserves and incurred losses among accident years requires qualitative and quantitative adjustments and allocations~~ at these various levels. We utilize actuarial science, business expertise and management judgment in a manner intended to ensure the accuracy and consistency of our reserving practices. Management’s best estimate is developed through collaboration with actuarial, underwriting, claims, legal and finance departments and culminates with the input of reserve committees. Each segment

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reserve committee includes the participation of the relevant parties from actuarial, finance, claims and segment senior management and has the responsibility for recommending and approving management’s best estimate. Reserves are further reviewed by Everest’s Chief Reserving Actuary and senior management. The objective of such process is to determine a single best estimate viewed by management to be the best estimate of its ultimate loss liability. Nevertheless, our reserves are estimates, which are subject to variation, which may be significant.

There can be no assurance that reserves for, and losses from, claim obligations will not increase in the future, possibly by a material amount. However, we believe that our existing reserves and reserving methodologies lessen the probability that any such increase would have a material adverse effect on our financial condition, results of operations or cash flows.

Asbestos and Environmental Exposures. Asbestos and Environmental (“A&E&E”) exposures represent a separate exposure group for monitoring and evaluating reserve adequacy. The following table summarizes the outstanding loss reserves with respect to A&E reserves on both a gross and net of retrocessions basis for the periods indicated.

At

At

March 31,

December 31,
(Dollars in millions)
2022

2021
Gross reserves
$
153.1

$
175.2
Ceded reserves

(17.5)

(19.0)
Net reserves
$
135.6

$
156.1

(Some amounts may not reconcile due to rounding.)


	At March 31,		At December 31,
(Dollars in millions)	2023		2022
Gross reserves	$	271	$	278
Ceded reserves	(20)		(21)
Net reserves	$	251	$	257

(Some amounts may not reconcile due to rounding.)

With respect to asbestos only, at March 31, ~~2022,~~2023, we had net asbestos loss reserves of ~~$135.8~~$227 million, or ~~100.2%~~90.4%, of total net A&E reserves, all of which was for assumed business.

Ultimate loss projections for A&E liabilities cannot be accomplished using standard actuarial techniques. We believe that our A&E reserves represent management’s best estimate of the ultimate liability; however, there can be no assurance that ultimate loss payments will not exceed such reserves, perhaps by a significant amount.

Industry analysts use the “survival ratio” to compare the A&E reserves among companies with such liabilities. The survival ratio is typically calculated by dividing a company’s current net reserves by the three year average of annual paid losses. Hence, the survival ratio equals the number of years that it would take to exhaust the current reserves if future loss payments were to continue at historical levels. Using this measurement, our net three year asbestos survival ratio was ~~3.8~~6.7 years at March 31, ~~2022.~~2023. These metrics can be skewed by individual large settlements occurring in the prior three years and therefore, may not be indicative of the timing of future payments.

LIQUIDITY AND CAPITAL RESOURCES

Capital. Shareholders’ equity at March 31, ~~2022~~2023 and December 31, ~~2021~~2022 was ~~$9.5~~$9.0 billion and ~~$10.1~~$8.4 billion, respectively. Management’s objective in managing capital is to ensure its overall capital level, as well as the capital levels of its operating subsidiaries, exceed the amounts required by regulators, the amount needed to support our current financial strength ratings from rating agencies and our own economic capital models. The Company’s capital has historically exceeded these benchmark levels.

Our two main operating companies Bermuda Re and Everest Re are regulated by the Bermuda Monetary Authority (“BMA”) and the State of Delaware, Department of Insurance, respectively. Both regulatory bodies have their own capital adequacy models based on statutory capital as opposed to GAAP basis equity. Failure to meet the required statutory capital levels could result in various regulatory restrictions, including business activity and the payment of dividends to their parent companies.

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The regulatory targeted capital and the actual statutory capital for Bermuda Re and Everest Re were as follows:


	Bermuda Re (2) At December 31,				Everest Re (2) At December 31,
(Dollars in millions)	2023		2022		2023		2022
Regulatory targeted capital	$	2,217	$	2,169	$	3,353	$	2,960
Actual capital	$	2,759	$	3,184	$	5,553	$	5,717

Bermuda Re ⁽¹⁾

Everest Re ⁽²⁾

At December 31,

At December 31,
(Dollars in millions)
2021

2020

2021

2020
Regulatory targeted capital
$
2,169.3

$
1,923.2

$
2,960.0

$
2,489.8
Actual capital
$
3,184.1

$
2,930.3

$
5,717.1

$
5,276.0

⁽¹⁾Regulatory targeted capital represents the target capital level from the applicable year's BSCR calculation.

⁽²⁾Regulatory targeted capital represents 200% of the RBC authorized control level calculation for the applicable year.

Our financial strength ratings as determined by A.M. Best, Standard & Poor’s and Moody’s are important as they provide our customers and investors with an independent assessment of our financial strength using a rating scale that provides for relative comparisons. We continue to possess significant financial flexibility and access to

debt and equity markets as a result of our financial strength, as evidenced by the financial strength ratings as assigned by independent rating agencies.

We maintain our own economic capital models to monitor and project our overall capital, as well as the capital at our operating subsidiaries. A key input to the economic models is projected income and this input is continually compared to actual results, which may require a change in the capital strategy.

~~On October 4, 2021, we issued $1.0 billion of 31 year senior notes with an interest coupon rate of 3.125%. These senior notes will mature on October 15, 2052 and will pay interest semi-annually.~~

During the first quarter of ~~2022, we repurchased 5,000~~ 2023, there were no shares ~~for $1.3 million~~repurchased in the open ~~market and~~market. We paid ~~$61.1~~$65 million in dividends to adjust our capital position and enhance ~~long term~~long-term expected returns to our shareholders. In ~~2021,~~2022, we repurchased ~~887,622~~241,273 shares for ~~$225.1~~$61 million in the open market and paid ~~$246.7~~$255 million in ~~dividends to adjust our capital position and enhance long term expected returns to our shareholders.~~dividends. We may at times enter into a Rule 10b5-1 repurchase plan agreement to facilitate the repurchase of shares. On May 22, 2020, our existing Board authorization to purchase up to 30 million of our shares was amended to authorize the purchase of up to 32 million shares. As of March 31, ~~2022,~~2023, we had repurchased ~~30.5~~30.8 million shares under this authorization.

We may continue, from time to time, to seek to retire portions of our outstanding debt securities through cash repurchases, in open-market purchases, privately negotiated transactions or otherwise. Such repurchases, if any, will be subject to and depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved in any such transactions, individually or in the aggregate, may be material.

Liquidity. Our liquidity requirements are generally met from positive cash flow from operations. Positive cash flow results from reinsurance and insurance premiums being collected prior to disbursements for claims, which disbursements generally take place over an extended period after the collection of premiums, sometimes a period of many years. Collected premiums are generally invested, prior to their use in such disbursements, and investment income provides additional funding for loss payments. Our net cash flows from operating activities were ~~$846.4 million~~$1.1 billion and ~~$904.4~~$846 million for the three months ended March 31, ~~2022~~2023 and ~~2021,~~2022, respectively. Additionally, these cash flows reflected net catastrophe loss payments of ~~$196.0~~$198 million and ~~$173.6~~$196 million for the three months ended March 31, ~~2022~~2023 and ~~2021,~~2022, respectively and net tax payments of ~~$2.7~~$2 million and ~~$6.4~~$3 million for the three months ended March 31, 2023 and 2022, ~~and 2021,~~ respectively.

If disbursements for claims and benefits, policy acquisition costs and other operating expenses were to exceed premium inflows, cash flow from reinsurance and insurance operations would be negative. The effect on cash flow from insurance operations would be partially offset by cash flow from investment income. Additionally, cash inflows from investment maturities ~~and dispositions,~~- both short-term investments and longer term maturities are available to supplement other operating cash flows.

We do not expect to supplement negative insurance operations cash flows from investment dispositions.

As the timing of payments for claims and benefits cannot be predicted with certainty, we maintain portfolios of ~~long term~~long-term invested assets with varying maturities, along with short-term investments that provide additional liquidity for payment of claims. At March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, we held cash and short-term investments of $2.6 billion and ~~$2.6~~$2.4 billion, respectively. Our short-term investments are generally readily marketable and can be converted to cash. In addition to these cash and short-term investments, at March 31, ~~2022,~~2023, we had $1.4 billion of available for sale fixed maturity securities maturing within one year or less, ~~$7.1~~$7.9 billion maturing within one to five years and ~~$6.2~~$5.4 billion maturing after five years. Our ~~$1.8 billion~~$250 million of equity securities are comprised primarily of publicly traded securities that we believe can be easily liquidated. We believe that these fixed maturity and equity securities, in conjunction with the short-term investments and positive cash flow from operations, provide ample sources of liquidity for the expected payment of losses in the near future. We do not anticipate selling a significant amount of securities to pay losses and ~~LAE but have the ability to do so. Sales of securities might result in net gains (losses) on investments.~~LAE. At March 31, ~~2022~~2023 we had ~~$653.0 million~~$1.6 billion of

net pre-tax unrealized depreciation related to fixed maturity - available for

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sale securities, comprised of ~~$806.8 million~~$1.7 billion of pre-tax unrealized depreciation and ~~$153.7~~$91 million of pre-tax unrealized appreciation.

Management generally expects annual positive cash flow from operations, which reflects the strength of overall pricing. However, given the recent set of catastrophic events, cash flow from operations may decline and could become negative in the near term as significant claim payments are made related to the catastrophes. However, as indicated above, the Company has ample liquidity to settle its catastrophe ~~claims.~~

claims and/or any payments due for its catastrophe bond program.

In addition to our cash flows from operations and liquid investments, we also have multiple active credit facilities that provide commitments of up to ~~$1.2~~$1.5 billion of collateralized standby letters of credit to support business written by our Bermuda operating subsidiaries. In addition, the Company has the ability to request access to an additional ~~$340.0~~$440 million of uncommitted credit facilities, which would require approval from the applicable lender. There is no guarantee the uncommitted capacity will be available to us on a future date. See Note 9 – Credit Facilities for further details.

Market Sensitive Instruments.

The SEC’s Financial Reporting Release #48 requires registrants to clarify and expand upon the existing financial statement disclosure requirements for derivative financial instruments, derivative commodity instruments and other financial instruments (collectively, “market sensitive instruments”). We do not generally enter into market sensitive instruments for trading purposes.

Our current investment strategy seeks to maximize after-tax income through a high quality, diversified, fixed maturity portfolio, while maintaining an adequate level of liquidity. Our mix of investments is adjusted periodically, consistent with our current and projected operating results and market conditions. The fixed maturity securities in the investment portfolio are comprised of non-trading ~~available for sale~~ securities. Additionally, we have invested in equity securities.

The overall investment strategy considers the scope of present and anticipated Company operations. In particular, estimates of the financial impact resulting from non-investment asset and liability transactions, together with our capital structure and other factors, are used to develop a net liability analysis. This analysis includes estimated payout characteristics for which our investments provide liquidity. This analysis is considered in the development of specific investment strategies for asset allocation, duration and credit quality. The change in overall market sensitive risk exposure principally reflects the asset changes that took place during the period.

Interest Rate Risk. Our ~~$29.3~~$31.4 billion investment portfolio, at March 31, ~~2022,~~2023, is principally comprised of fixed maturity securities, which are generally subject to interest rate risk and some foreign currency exchange rate risk, and some equity securities, which are subject to price fluctuations and some foreign exchange rate risk. The overall economic impact of the foreign exchange risks on the investment portfolio is partially mitigated by changes in the dollar value of foreign currency denominated liabilities and their associated income statement impact.

Interest rate risk is the potential change in value of the fixed maturity securities portfolio, including short-term investments, from a change in market interest rates. In a declining interest rate environment, it includes prepayment risk on the ~~$3.4~~$4.5 billion of mortgage-backed securities in the ~~$22.0~~$24.4 billion fixed maturity portfolio. Prepayment risk results from potential accelerated principal payments that shorten the average life and thus the expected yield of the security.

The table below displays the potential impact of market value fluctuations and after-tax unrealized appreciation on our fixed maturity portfolio (including ~~$823.9 million~~$1.0 billion of short-term investments) for the period indicated based on upward and downward parallel and immediate 100 and 200 basis point shifts in interest rates. For legal entities with a U.S. dollar functional currency, this modeling was performed on each security individually. To generate appropriate price estimates on mortgage-backed securities, changes in prepayment expectations under different interest rate environments were

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taken into account. For legal entities with a non-U.S. dollar

functional currency, the effective duration of the involved portfolio of securities was used as a proxy for the market value change under the various interest rate change scenarios.

Impact of Interest Rate Shift in Basis Points

At March 31, 2022

-200

-100

0

100

200
(Dollars in millions)

Total Market/Fair Value
$
24,300.1

$
23,561.2

$
22,822.3

$
22,083.4

$
21,344.5

Market/Fair Value Change from Base (%)

6.5
%

3.2
%

0.0
%

(3.2)
%

(6.5)
%
Change in Unrealized Appreciation

After-tax from Base ($)
$
1,286.2

$
643.1

$
-

$
(643.1)

$
(1,286.2)


	Impact of Interest Rate Shift in Basis Points At March 31, 2023
	-200			-100			0			100			200
(Dollars in millions)
Total Fair Value	$	26,918		$	26,168		$	25,419		$	24,670		$	23,921
Fair Value Change from Base (%)	5.9		%	2.9		%	—		%	(2.9)		%	(5.9)		%
Change in Unrealized Appreciation
After-tax from Base ($)	$	1,317		$	659		$	—		$	(659)		$	(1,317)

We had ~~$19.5~~$22.9 billion and ~~$19.0~~$22.1 billion of gross reserves for losses and LAE as of March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively. These amounts are recorded at their nominal value, as opposed to present value, which would reflect a discount adjustment to reflect the time value of money. Since losses are paid out over a period of time, the present value of the reserves is less than the nominal value. As interest rates rise, the present value of the reserves decreases and, conversely, as interest rates decline, the present value increases. These movements are the opposite of the interest rate impacts on the fair value of investments. While the difference between present value and nominal value is not reflected in our financial statements, our financial results will include investment income over time from the investment portfolio until the claims are paid. Our loss and loss reserve obligations have an expected duration of approximately ~~3.9~~3.8 years, which is reasonably consistent with our fixed income portfolio. If we were to discount our loss and LAE reserves, net of ceded reserves, the discount would be approximately ~~$1.6~~$3.8 billion resulting in a discounted reserve balance of approximately ~~$15.9~~$16.9 billion, representing approximately ~~69.5%~~66.6% of the value of the fixed maturity investment portfolio funds.

Equity Risk. Equity risk is the potential change in fair ~~and/or market~~ value of the common stock, preferred stock and mutual fund portfolios arising from changing prices. Our equity investments consist of a diversified portfolio of individual securities and mutual funds, which invest principally in high quality common and preferred stocks that are traded on the major exchanges, and mutual fund investments in emerging market debt. The primary objective of the equity portfolio is to obtain greater total return relative to our core bonds over time through market appreciation and income.

The table below displays the impact on ~~fair/market~~fair value and after-tax change in ~~fair/market~~fair value of a 10% and 20% change in equity prices up and down for the period indicated.

Impact of Percentage Change in Equity Fair/Market Values

At March 31, 2022
(Dollars in millions)
-20%

-10%

0%

10%

20%
Fair/Market Value of the Equity Portfolio
$
1,424.4

$
1,602.5

$
1,780.5

$
1,958.6

$
2,136.6
After-tax Change in Fair/Market Value
$
(282.2)

$
(141.1)

$
-

$
141.1

$
282.2


	Impact of Percentage Change in Equity Fair Values At March 31, 2023
(Dollars in millions)	-20%		-10%		0%		10%		20%
Fair Value of the Equity Portfolio	$	200	$	225	$	250	$	275	$	300
After-tax Change in Fair Value	$	(41)	$	(20)	$	—	$	20	$	41

Foreign Currency Risk. Foreign currency risk is the potential change in value, income and cash flow arising from adverse changes in foreign currency exchange rates. Each of our non-U.S./Bermuda (“foreign”) operations maintains capital in the currency of the country of its geographic location consistent with local regulatory guidelines. Each foreign operation may conduct business in its local currency, as well as the currency of other countries in which it operates. The primary foreign currency exposures for these foreign operations are the Canadian Dollar, the Singapore Dollar, the British Pound Sterling and the Euro. We mitigate foreign exchange exposure by generally matching the currency and duration of our assets to our corresponding operating liabilities. In accordance with FASB guidance, the impact on the ~~market~~fair value of available for sale fixed maturities due to changes in foreign currency exchange rates, in relation to functional currency, is reflected as part of other comprehensive income. Conversely, the impact of changes in foreign currency exchange rates, in relation to functional currency, on other assets and liabilities is reflected through net income as a component of other income (expense). In addition, we translate the assets, liabilities and income of non-U.S. dollar functional

currency legal entities to the U.S. dollar. This translation amount is reported as a component of other comprehensive income.

Safe Harbor Disclosure.

This report contains forward-looking statements within the meaning of the U.S. federal securities laws. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the federal securities laws. In some cases, these statements can be identified by the use of forward-looking words such as “may”, ~~“will”~~

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“will”, “should”, “could”, “anticipate”, “estimate”, “expect”, “plan”, “believe”, “predict”, “potential” and “intend”. Forward-looking statements contained in this report include information regarding our reserves for losses and LAE, the CARES Act, the impact of the Tax Cut and Jobs Act, the adequacy of capital in relation to regulatory required capital, the adequacy of our provision for uncollectible balances, estimates of our catastrophe exposure, include:

•the effects of catastrophic and pandemic events on our financial ~~statements,~~ statements;

•estimates of our catastrophe exposure;

•information regarding our reserves for losses and LAE;

•our failure to accurately assess underwriting risk;

•decreases in pricing for property and casualty reinsurance and insurance;

•our ability to maintain our financial strength ratings;

•the failure of our insured, intermediaries and reinsurers to satisfy their obligations;

•our inability or failure to purchase reinsurance;

•consolidation of competitors, customers and insurance and reinsurance brokers;

•the effect on our business of the highly competitive nature of our industry, including the effect of new entrants to, competing products for and consolidation in the (re)insurance industry;

•our ability to retain our key executive officers and to attract or retain the executives and employees necessary to manage our business;

•the performance of our investment portfolio;

•our ability to determine any impairments taken on our investments;

•foreign currency exchange rate fluctuations;

•the effect of cybersecurity risks, including technology breaches or failure, on our business;

•the CARES Act;

•the impact of the Tax Cut and Jobs Act;

•the adequacy of capital in relation to regulatory required capital; and

•the ability of Everest Re, Holdings, Everest Underwriting Group (Ireland) Limited, Everest Dublin Insurance Holdings ~~Ireland, Dublin Holdings,~~Limited (Ireland), Bermuda Re and Everest International Reinsurance, Ltd. to pay ~~dividends and the settlement costs of our specialized equity index put option contracts.~~ dividends.

Forward-looking statements only reflect our expectations and are not guarantees of performance. These statements involve risks, uncertainties and assumptions. Actual events or results may differ materially from our expectations. Important factors that could cause our actual events or results to be materially different from our expectations include those discussed under the caption ITEM 1A, “Risk Factors” in the Company’s most recent 10-K filing. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market Risk Instruments. See “Liquidity and Capital Resources - Market Sensitive Instruments” in PART I – ITEM 2.

ITEM 4.CONTROLS AND PROCEDURES

As of the end of the period covered by this report, our management carried out an evaluation, with the participation of the Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)). Based on their evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission’s rules and forms. Our management, with the participation of the Chief Executive Officer and Chief Financial Officer, also conducted an evaluation of our internal control over financial reporting to determine whether any changes occurred during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Based on that evaluation, there has been no such change during the quarter covered by this report.

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PART II

~~PART II~~

ITEM 1. LEGAL PROCEEDINGS

resolved through both informal and formal means, including negotiated resolution, arbitration and litigation. In all such matters, the Company believes that its positions are legally and commercially reasonable. The Company considers the statuses of these proceedings when determining its reserves for unpaid loss and loss adjustment expenses.

Aside from litigation and arbitrations related to these insurance and reinsurance agreements, the Company is not a party to any other material litigation or arbitration.

ITEM 1A. RISK FACTORS

No material changes.

ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities.

Issuer Purchases of Equity Securities

(a)
(b)
(c)
(d)

Maximum Number (or

Total Number of
Approximate Dollar

Shares (or Units)
Value) of Shares (or

Purchased as Part
Units) that May Yet

Total Number of

of Publicly
Be Purchased Under

Shares (or Units)
Average Price Paid
Announced Plans or
the Plans or
Period
Purchased
per Share (or Unit)
Programs
Programs (1)
January 1 - 31, 2022
-
$
-
-
1,470,181
February 1 - 28, 2022
44,455
$
299.5577
-
1,470,181
March 1 - 31, 2022
11,175
$
269.9151
5,000
1,465,181
Total
55,630
$
-
5,000
1,465,181


Issuer Purchases of Equity Securities
	(a)	(b)		(c)	(d)
Period	Total Number of Shares (or Units) Purchased (2)	Average Price Paid per Share (or Unit)		Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs (1)
January 1 - 31, 2023	—	$	—	—	1,228,908
February 1 - 28, 2023	44,937	$	382.9829	—	1,228,908
March 1 - 31, 2023	6,273	$	340.8460	—	1,228,908
Total	51,210	$	—	—	1,228,908

(1)On May 22, 2020, the Company’s executive committee of the Board of Directors approved an amendment to the share repurchase program authorizing the Company and/or its subsidiary Holdings, to purchase up to a current aggregate of 32.0 million of the Company’s shares (recognizing that the number of shares authorized for repurchase has been reduced by those shares that have already been purchased) in open market transactions, privately negotiated transactions or both. Currently, the Company and/or its subsidiary Holdings have repurchased ~~30.5~~30.8 million of the Company’s shares.

(2)Shares that have not been repurchased through a publicly announced plan or program consist of shares repurchased by the Company from employees in order to satisfy tax withholding obligations on vestings and/or settlements of share based compensation awards.

ITEM 3.DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.MINE SAFETY DISCLOSURES

Not applicable.

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ITEM 5.OTHER INFORMATION

~~None.~~

None.

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ITEM 6.EXHIBITS

Exhibit Index


Exhibit No.						Description

10.1						Employment Agreement, effective January 1, 2023, between Everest Global Services, Inc. and Joseph V. Taranto, filed herewith

10.2						Separation, Transition Services, and General Release Agreement between Everest Global Services, Inc., Everest Re Group, Ltd., and its current and former parents, subsidiaries, affiliates, predecessors, successors and assigns, and Sanjoy Mukherjee, filed herewith

31.1						Section 302 Certification of Juan C. Andrade

31.2						Section 302 Certification of Mark Kociancic

32.1						Section 906 Certification of Juan C. Andrade and Mark Kociancic

101.INS						XBRL Instance Document

101.SCH						XBRL Taxonomy Extension Schema

101.CAL						XBRL Taxonomy Extension Calculation Linkbase

101.DEF						XBRL Taxonomy Extension Definition Linkbase

101.LAB						XBRL Taxonomy Extension Labels Linkbase

101.PRE						XBRL Taxonomy Extension Presentation Linkbase

104						Cover Page Interactive Data File (embedded within the Inline XBRL document)

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Everest Re Group, Ltd.

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


			Everest Re Group, Ltd.
			(Registrant)


			/S/ MARK KOCIANCIC
			Mark Kociancic
			Executive Vice President and
Chief Financial Officer

			(Duly Authorized Officer and Principal Financial Officer)

Dated: May ~~5, 2022~~

4, 2023

~~Item 1.~~	~~Legal Proceedings~~	42
			PART II
~~Item 1A.~~			~~Risk Factors~~	43
			OTHER INFORMATION

Item 1.			Legal Proceedings	44

Item 1A.			Risk Factors	44

Item 2.			Unregistered Sales of Equity Securities and Use of Proceeds	4344

Item 3.			Defaults Upon Senior Securities	4344

Item 4.			Mine Safety Disclosures	4344

Item 5.			Other Information	4345

Item 6.			Exhibits	4446

	March 31,		December 31,
(Dollars and share amounts in thousands, except par value per share)	2022		2021
	(unaudited)
ASSETS:
Fixed maturities - available for sale	$	21,998,415	$	22,308,272
(amortized cost: 2022, $22,693,029; 2021, $22,063,592, credit allowances: 2022, $(41,591); 2021, $(29,738))
Equity securities, at fair value		1,780,526		1,825,908
Short-term investments (cost: 2022, $823,889; 2021, $1,178,386)		823,875		1,178,337
Other invested assets		2,917,039		2,919,965
Cash		1,778,218		1,440,861
Total investments and cash		29,298,073		29,673,343
Accrued investment income		156,997		149,105
Premiums receivable		3,264,023		3,293,598
Reinsurance recoverables		2,101,641		2,053,354
Funds held by reinsureds		920,054		868,601
Deferred acquisition costs		842,739		872,289
Prepaid reinsurance premiums		496,632		515,445
Income taxes		117,609		2,381
Other assets		789,014		757,167
TOTAL ASSETS	$	37,986,782	$	38,185,283

LIABILITIES:
Reserve for losses and loss adjustment expenses	$	19,495,637	$	19,009,486
Future policy benefit reserve		34,523		35,669
Unearned premium reserve		4,571,705		4,609,634
Funds held under reinsurance treaties		4,732		18,391
Other net payable to reinsurers		464,000		449,723
Losses in course of payment		133,888		260,684
Senior notes		2,346,147		2,345,800
Long term notes		223,799		223,774
Borrowings from FHLB		519,000		519,000
Accrued interest on debt and borrowings		38,843		17,348
Unsettled securities payable		67,698		16,698
Other liabilities		559,181		539,896
Total liabilities		28,459,153		28,046,103

Commitments and contingencies (Note 7)		(nil)		(nil)

SHAREHOLDERS' EQUITY:
Preferred shares, par value: $0.01; 50,000 shares authorized;
0 shares issued and outstanding		-		-
Common shares, par value: $0.01; 200,000 shares authorized; (2022) 69,977
and (2021) 69,790 outstanding before treasury shares		700		698
Additional paid-in capital		2,271,890		2,274,431
Accumulated other comprehensive income (loss), net of deferred income
tax expense (benefit) of $(89,926) at 2022 and $26,781 at 2021		(832,820)		11,523
Treasury shares, at cost; 30,529 shares (2022) and 30,524 shares (2021)		(3,848,630)		(3,847,308)
Retained earnings		11,936,489		11,699,836
Total shareholders' equity		9,527,629		10,139,180
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	37,986,782	$	38,185,283

The accompanying notes are an integral part of the consolidated financial statements.


	March 31,		December 31,
(Dollars and share amounts in millions, except par value per share)	2023		2022
	(unaudited)
ASSETS:
Fixed maturities - available for sale, at fair value (amortized cost: 2023, $25,247; 2022, $24,191, credit allowances: 2023, $(62); 2022, $(54))	$	23,560	$	22,236
Fixed maturities - held to maturity, at amortized cost (fair value: 2023, $814; 2022, $821, net of credit allowances: 2023, $(9); 2022, $(9))	825		839
Equity securities, at fair value	250		281
Other invested assets	4,156		4,085
Short-term investments	1,034		1,032
Cash	1,610		1,398
Total investments and cash	31,435		29,872
Accrued investment income	235		217
Premiums receivable (net of credit allowances: 2023, $(30); 2022, $(29))	3,922		3,619
Reinsurance paid loss recoverables (net of credit allowances: 2023, $(24); 2022, $(23))	182		136
Reinsurance unpaid loss recoverables	2,125		2,105
Funds held by reinsureds	1,071		1,056
Deferred acquisition costs	1,011		962
Prepaid reinsurance premiums	611		610
Income tax asset, net	387		459
Other assets (net of credit allowances: 2023, $(7); 2022, $(5))	860		930
TOTAL ASSETS	$	41,839	$	39,966

LIABILITIES:
Reserve for losses and loss adjustment expenses	$	22,878	$	22,065
Future policy benefit reserve	29		29
Unearned premium reserve	5,418		5,147
Funds held under reinsurance treaties	10		13
Other net payable to reinsurers	618		567
Losses in course of payment	123		74
Senior notes	2,348		2,347
Long-term notes	218		218
Borrowings from FHLB	519		519
Accrued interest on debt and borrowings	41		19
Unsettled securities payable	201		1
Other liabilities	422		526
Total liabilities	32,825		31,525

Commitments and contingencies (Note 7)

SHAREHOLDERS' EQUITY:
Preferred shares, par value: $0.01; 50.0 shares authorized; no shares issued and outstanding	—		—
Common shares, par value: $0.01; 200.0 shares authorized; (2023) 70.0 and (2022) 69.9 outstanding before treasury shares	1		1
Additional paid-in capital	2,295		2,302
Accumulated other comprehensive income (loss), net of deferred income tax expense (benefit) of $(218) at 2023 and $(250) at 2022	(1,716)		(1,996)
Treasury shares, at cost; 30.8 shares (2023) and 30.8 shares (2022)	(3,908)		(3,908)
Retained earnings	12,342		12,042
Total shareholders' equity	9,014		8,441
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	41,839	$	39,966

	Three Months Ended
	March 31,
(Dollars in thousands, except per share amounts)	2022		2021
	(unaudited)
REVENUES:
Premiums earned	$	2,791,765	$	2,387,865
Net investment income		242,830		260,413
Net gains (losses) on investments:
Credit allowances on fixed maturity securities		(11,853)		(6,977)
Gains (losses) from fair value adjustments		(136,860)		29,056
Net realized gains (losses) from dispositions		(4,914)		16,823
Total net gains (losses) on investments		(153,627)		38,902
Other income (expense)		15,363		56,593
Total revenues		2,896,331		2,743,773

CLAIMS AND EXPENSES:
Incurred losses and loss adjustment expenses		1,789,863		1,711,419
Commission, brokerage, taxes and fees		605,230		489,011
Other underwriting expenses		161,293		142,231
Corporate expenses		14,020		12,378
Interest, fees and bond issue cost amortization expense		24,078		15,639
Total claims and expenses		2,594,484		2,370,678

INCOME (LOSS) BEFORE TAXES		301,847		373,095
Income tax expense (benefit)		4,096		31,233

NET INCOME (LOSS)	$	297,751	$	341,862

Other comprehensive income (loss), net of tax:
Unrealized appreciation (depreciation) ("URA(D)") on securities arising during the period		(815,177)		(288,615)
Reclassification adjustment for realized losses (gains) included in net income (loss)		4,178		(3,666)
Total URA(D) on securities arising during the period		(810,999)		(292,281)

Foreign currency translation adjustments		(34,102)		(9,582)

Reclassification adjustment for amortization of net (gain) loss included in net income (loss)		758		2,043
Total benefit plan net gain (loss) for the period		758		2,043
Total other comprehensive income (loss), net of tax		(844,343)		(299,820)

COMPREHENSIVE INCOME (LOSS)	$	(546,592)	$	42,042

EARNINGS PER COMMON SHARE:
Basic	$	7.57	$	8.53
Diluted		7.56		8.52

The accompanying notes are an integral part of the consolidated financial statements.


	Three Months Ended March 31,
(Dollars in millions, except dividends per share amounts)		2023		2022
	(unaudited)
COMMON SHARES (shares outstanding):
Balance beginning of period		39		39
Issued (redeemed) during the period, net		—		—
Treasury shares acquired		—		—
Balance end of period		39		39

COMMON SHARES (par value):
Balance beginning of period		$	1	$	1
Issued during the period, net		—		—
Balance end of period		1		1

ADDITIONAL PAID-IN CAPITAL:
Balance beginning of period		2,302		2,274
Share-based compensation plans		(7)		(3)
Balance end of period		2,295		2,272

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS), NET OF DEFERRED INCOME TAXES:
Balance beginning of period		(1,996)		12
Net increase (decrease) during the period		280		(844)
Balance end of period		(1,716)		(833)

RETAINED EARNINGS:
Balance beginning of period		12,042		11,700
Net income (loss)		365		298
Dividends declared ($1.65 per share in 1Q2023 and $1.55 per share in 1Q2022)		(65)		(61)
Balance, end of period		12,342		11,936

TREASURY SHARES AT COST:
Balance beginning of period		(3,908)		(3,847)
Purchase of treasury shares		—		(1)
Balance end of period		(3,908)		(3,849)

TOTAL SHAREHOLDERS' EQUITY, END OF PERIOD		$	9,014	$	9,528

	Three Months Ended
	March 31,
(Dollars in thousands)	2022		2021
	(unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	297,751	$	341,862
Adjustments to reconcile net income to net cash provided by operating activities:
Decrease (increase) in premiums receivable		(14,203)		(105,460)
Decrease (increase) in funds held by reinsureds, net		(67,033)		(25,584)
Decrease (increase) in reinsurance recoverables		(125,881)		(14,518)
Decrease (increase) in income taxes		1,251		24,908
Decrease (increase) in prepaid reinsurance premiums		(7,167)		(27,071)
Increase (decrease) in reserve for losses and loss adjustment expenses		632,398		655,070
Increase (decrease) in future policy benefit reserve		(1,146)		(162)
Increase (decrease) in unearned premiums		4,045		196,631
Increase (decrease) in other net payable to reinsurers		46,310		105,390
Increase (decrease) in losses in course of payment		(125,074)		11,980
Change in equity adjustments in limited partnerships		(97,831)		(116,767)
Distribution of limited partnership income		71,174		18,125
Change in other assets and liabilities, net		47,052		(149,480)
Non-cash compensation expense		11,912		11,021
Amortization of bond premium (accrual of bond discount)		19,254		17,323
Net (gains) losses on investments		153,627		(38,902)
Net cash provided by (used in) operating activities		846,439		904,366

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from fixed maturities matured/called - available for sale		849,019		818,352
Proceeds from fixed maturities sold - available for sale		418,988		228,278
Proceeds from equity securities sold, at fair value		90,101		281,313
Distributions from other invested assets		162,719		52,211
Cost of fixed maturities acquired - available for sale		(2,010,859)		(1,776,730)
Cost of equity securities acquired, at fair value		(195,026)		(174,981)
Cost of other invested assets acquired		(137,430)		(98,939)
Net change in short-term investments		354,761		308,585
Net change in unsettled securities transactions		46,399		(93,610)
Net cash provided by (used in) investing activities		(421,328)		(455,521)

CASH FLOWS FROM FINANCING ACTIVITIES:
Common shares issued during the period for share-based compensation, net of expense		(14,450)		(10,583)
Purchase of treasury shares		(1,322)		(23,545)
Dividends paid to shareholders		(61,097)		(62,229)
Cost of shares withheld on settlements of share-based compensation awards		(16,692)		(12,507)
Net cash provided by (used in) financing activities		(93,561)		(108,864)

EFFECT OF EXCHANGE RATE CHANGES ON CASH		5,807		(8,972)

Net increase (decrease) in cash		337,357		331,009
Cash, beginning of period		1,440,861		801,651
Cash, end of period	$	1,778,218	$	1,132,660

SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes paid (recovered)	$	2,681	$	6,417
Interest paid		2,210		1,880

The accompanying notes are an integral part of the consolidated financial statements.

		At March 31, 2022
		Amortized		Allowance for		Unrealized		Unrealized		Market
(Dollars in thousands)		Cost		Credit Losses		Appreciation		Depreciation		Value
Fixed maturity securities
	U.S. Treasury securities and obligations of
	U.S. government agencies and corporations	$	1,387,723	$	-	$	9,506	$	(41,423)	$	1,355,806
	Obligations of U.S. states and political subdivisions		560,375		(151)		9,538		(10,574)		559,188
	Corporate securities		7,510,255		(20,049)		64,802		(263,958)		7,291,050
	Asset-backed securities		4,046,636		(7,679)		13,228		(54,294)		3,997,891
	Mortgage-backed securities
	Commercial		1,021,013		-		2,762		(31,904)		991,871
	Agency residential		2,387,754		-		5,354		(109,611)		2,283,497
	Non-agency residential		5,759		-		-		(114)		5,645
	Foreign government securities		1,414,589		-		16,763		(68,970)		1,362,382
	Foreign corporate securities		4,358,925		(13,712)		31,776		(225,904)		4,151,085
Total fixed maturity securities		$	22,693,029	$	(41,591)	$	153,729	$	(806,752)	$	21,998,415

		At December 31, 2021
		Amortized		Allowance for		Unrealized		Unrealized		Market
(Dollars in thousands)		Cost		Credit Losses		Appreciation		Depreciation		Value
Fixed maturity securities
	U.S. Treasury securities and obligations of
	U.S. government agencies and corporations	$	1,407,256	$	-	$	23,720	$	(10,358)	$	1,420,618
	Obligations of U.S. states and political subdivisions		558,842		(151)		29,080		(1,150)		586,621
	Corporate securities		7,443,535		(19,267)		195,210		(62,580)		7,556,898
	Asset-backed securities		3,579,439		(7,679)		21,817		(11,848)		3,581,729
	Mortgage-backed securities
	Commercial		1,032,506		-		37,550		(5,690)		1,064,366
	Agency residential		2,361,208		-		32,997		(18,873)		2,375,332
	Non-agency residential		6,530		-		22		(16)		6,536
	Foreign government securities		1,423,634		-		41,957		(28,079)		1,437,512
	Foreign corporate securities		4,250,642		(2,641)		95,195		(64,536)		4,278,660
Total fixed maturity securities		$	22,063,592	$	(29,738)	$	477,548	$	(203,130)	$	22,308,272

	Roll Forward of Allowance for Credit Losses
	Three Months Ended March 31, 2022
					Obligations of
					U.S. States		Foreign
	Corporate		Asset-Backed		and Political		Corporate
	Securities		Securities		Subdivisions		Securities		Total
(Dollars in thousands)
Beginning Balance	$	(19,267)	$	(7,679)	$	(151)	$	(2,641)	$	(29,738)
Credit losses on securities where credit
losses were not previously recorded		(1,929)		-		-		(11,184)		(13,113)
Increases in allowance on previously
impaired securities		-		-		-		-		-
Decreases in allowance on previously
impaired securities		-		-		-		-		-
Reduction in allowance due to disposals		1,147		-		-		113		1,260

Balance as of March 31, 2022	$	(20,049)	$	(7,679)	$	(151)	$	(13,712)	$	(41,591)

	Roll Forward of Allowance for Credit Losses
	Three Months Ended March 31, 2021
					Foreign		Foreign
	Corporate		Asset-Backed		Government		Corporate
	Securities		Securities		Securities		Securities		Total
(Dollars in thousands)
Beginning Balance	$	(1,220)	$	-	$	(22)	$	(503)	$	(1,745)
Credit losses on securities where credit
losses were not previously recorded		(2,383)		(4,915)		-		-		(7,298)
Increases in allowance on previously
impaired securities		-		-		-		-		-
Decreases in allowance on previously
impaired securities		-		-		-		-		-
Reduction in allowance due to disposals		-		-		22		298		320

Balance as of March 31, 2021	$	(3,603)	$	(4,915)	$	-	$	(205)	$	(8,723)

			Fair Value Measurement Using:
			Quoted Prices
			in Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
			Assets		Inputs		Inputs
(Dollars in thousands)	March 31, 2022		(Level 1)		(Level 2)		(Level 3)
Assets:
Fixed maturities, market value
U.S. Treasury securities and obligations of
U.S. government agencies and corporations	$	1,355,806	$	-	$	1,355,806	$	-
Obligations of U.S. States and political subdivisions		559,188		-		559,188		-
Corporate securities		7,291,050		-		6,576,394		714,656
Asset-backed securities		3,997,891		-		2,609,200		1,388,691
Mortgage-backed securities
Commercial		991,871		-		985,981		5,890
Agency residential		2,283,497		-		2,283,497		-
Non-agency residential		5,645		-		5,645		-
Foreign government securities		1,362,382		-		1,362,382		-
Foreign corporate securities		4,151,085		-		4,135,159		15,926
Total fixed maturities, market value		21,998,415		-		19,873,252		2,125,163

Equity securities, fair value		1,780,526		1,698,324		82,202		-

(Dollars in thousands)
Note Series	Issue Date	Maturity Date	Amount
Series 2017-1 Class A-2	4/13/2017	4/13/2022	$	50,000
Series 2017-1 Class B-2	4/13/2017	4/13/2022		75,000
Series 2017-1 Class C-2	4/13/2017	4/13/2022		175,000
Series 2018-1 Class A-1	4/30/2018	5/6/2022		62,500
Series 2018-1 Class B-1	4/30/2018	5/6/2022		200,000
Series 2018-1 Class A-2	4/30/2018	5/5/2023		62,500
Series 2018-1 Class B-2	4/30/2018	5/5/2023		200,000
Series 2019-1 Class A-1	12/12/2019	12/19/2023		150,000
Series 2019-1 Class B-1	12/12/2019	12/19/2023		275,000
Series 2019-1 Class A-2	12/12/2019	12/19/2024		150,000
Series 2019-1 Class B-2	12/12/2019	12/19/2024		275,000
Series 2021-1 Class A-1	4/8/2021	4/21/2025		150,000
Series 2021-1 Class B-1	4/8/2021	4/21/2025		85,000
Series 2021-1 Class C-1	4/8/2021	4/21/2025		85,000
Series 2021-1 Class A-2	4/8/2021	4/20/2026		150,000
Series 2021-1 Class B-2	4/8/2021	4/20/2026		90,000
Series 2021-1 Class C-2	4/8/2021	4/20/2026		90,000
			$	2,325,000

					March 31, 2022				December 31, 2021
					Consolidated Balance				Consolidated Balance
(Dollars in thousands)	Date Issued	Date Due	Principal Amounts		Sheet Amount		Market Value		Sheet Amount		Market Value
4.868% Senior notes	6/5/2014	6/1/2044	$	400,000	$	397,343	$	437,148	$	397,314	$	503,840
3.5% Senior notes	10/7/2020	10/15/2050		1,000,000		980,178		895,420		980,046		1,054,520
3.125% Senior notes	10/4/2021	10/15/2052		1,000,000		968,626		832,780		968,440		983,140
			$	2,400,000	$	2,346,147	$	2,165,348	$	2,345,800	$	2,541,500

	Three Months Ended
	March 31,
(Dollars In thousands	2022		2021
Interest expense incurred 4.868% Senior notes	$	4,868	$	4,868
Interest expense incurred 3.5% Senior notes		8,807		8,805
Interest expense incurred 3.125% Senior notes		7,913		-
	$	21,588	$	13,673

	Three Months Ended						Percentage
	March 31,						Increase/
(Dollars in millions)	2022			2021			(Decrease)
Gross written premiums	$	3,186.4		$	2,931.4		8.7	%
Net written premiums		2,812.0			2,553.9		10.1	%

REVENUES:
Premiums earned	$	2,791.8		$	2,387.9		16.9	%
Net investment income		242.8			260.4		-6.8	%
Net gains (losses) on investments		(153.6)			38.9		NM
Other income (expense)		15.4			56.6		-72.9	%
Total revenues		2,896.3			2,743.8		5.6	%

CLAIMS AND EXPENSES:
Incurred losses and loss adjustment expenses		1,789.9			1,711.4		4.6	%
Commission, brokerage, taxes and fees		605.2			489.0		23.8	%
Other underwriting expenses		161.3			142.2		13.4	%
Corporate expenses		14.0			12.4		12.9	%
Interest, fees and bond issue cost amortization expense		24.1			15.6		54.5	%
Total claims and expenses		2,594.5			2,370.7		9.5	%

INCOME (LOSS) BEFORE TAXES		301.8			373.1		-19.1	%
Income tax expense (benefit)		4.1			31.2		-86.9	%
NET INCOME (LOSS)	$	297.8		$	341.9		-12.9	%

RATIOS:							Point Change
Loss ratio		64.1	%		71.7	%	(7.6)
Commission and brokerage ratio		21.7	%		20.5	%	1.2
Other underwriting expense ratio		5.8	%		5.9	%	(0.1)
Combined ratio		91.6	%		98.1	%	(6.5)

	At			At			Percentage
	March 31,			December 31,			Increase/
(Dollars in millions, except per share amounts)	2022			2021			(Decrease)
Balance sheet data:
Total investments and cash	$	29,298.1		$	29,673.3		-1.3	%
Total assets		37,986.8			38,185.3		-0.5	%
Loss and loss adjustment expense reserves		19,495.6			19,009.5		2.6	%
Total debt		3,088.9			3,088.6		-	%
Total liabilities		28,459.2			28,046.1		1.5	%
Shareholders' equity		9,527.6			10,139.2		-6.0	%
Book value per share		241.52			258.21		-6.5	%

(NM, not meaningful)
(Some amounts may not reconcile due to rounding.)

	Three Months Ended March 31,
	Current		Ratio %/		Prior		Ratio %/		Total		Ratio %/
(Dollars in millions)	Year		Pt Change		Years		Pt Change		Incurred		Pt Change
2022
Attritional	$	1,675.8	60.0	%	$	(0.9)	-	%		1,674.9	60.0	%
Catastrophes		115.0	4.1	%		-	-	%		115.0	4.1	%
Total	$	1,790.8	64.1	%	$	(0.9)	-	%	$	1,789.9	64.1	%

2021
Attritional	$	1,443.3	60.4	%	$	(1.8)	-0.1	%	$	1,441.4	60.3	%
Catastrophes		270.0	11.3	%		-	-	%		270.0	11.3	%
Total	$	1,713.3	71.7	%	$	(1.8)	-0.1	%	$	1,711.4	71.7	%

Variance 2022/2021
Attritional	$	232.5	(0.4)	pts	$	0.9	0.1	pts	$	233.5	(0.3)	pts
Catastrophes		(155.0)	(7.2)	pts		-	-	pts		(155.0)	(7.2)	pts
Total	$	77.5	(7.6)	pts	$	0.9	0.1	pts	$	78.5	(7.6)	pts

	At March 31, 2022
	Case		IBNR		Total		% of
(Dollars in millions)	Reserves		Reserves		Reserves		Total
Reinsurance	$	5,639.4	$	8,480.4	$	14,119.8	72.4	%
Insurance		1,570.3		3,652.5		5,222.8	26.8	%
Total excluding A&E		7,209.6		12,132.9		19,342.5	99.2	%
A&E		148.4		4.8		153.1	0.8	%
Total including A&E	$	7,358.0	$	12,137.7	$	19,495.6	100.0	%

(Some amounts may not reconcile due to rounding.)

	Bermuda Re ⁽¹⁾				Everest Re ⁽²⁾
	At December 31,				At December 31,
(Dollars in millions)	2021		2020		2021		2020
Regulatory targeted capital	$	2,169.3	$	1,923.2	$	2,960.0	$	2,489.8
Actual capital	$	3,184.1	$	2,930.3	$	5,717.1	$	5,276.0

Issuer Purchases of Equity Securities
	(a)	(b)		(c)	(d)
					Maximum Number (or
				Total Number of	Approximate Dollar
				Shares (or Units)	Value) of Shares (or
				Purchased as Part	Units) that May Yet
	Total Number of			of Publicly	Be Purchased Under
	Shares (or Units)	Average Price Paid		Announced Plans or	the Plans or
Period	Purchased	per Share (or Unit)		Programs	Programs (1)
January 1 - 31, 2022	-	$	-	-	1,470,181
February 1 - 28, 2022	44,455	$	299.5577	-	1,470,181
March 1 - 31, 2022	11,175	$	269.9151	5,000	1,465,181
Total	55,630	$	-	5,000	1,465,181