Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | Apr. 28, 2022 | |
Cover [Abstract] | ||
Amendment Flag | false | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | ALLEGHANY CORP /DE | |
Entity Central Index Key | 0000775368 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 13,454,888 | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Trading Symbol | Y | |
Title of 12(b) Security | Common Stock, $1.00 par value | |
Security Exchange Name | NYSE | |
Entity File Number | 1-9371 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 51-0283071 | |
Entity Address, Address Line One | 1411 Broadway, 34th Floor | |
Entity Address, City or Town | NY | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10018 | |
City Area Code | 212 | |
Local Phone Number | 752-1356 | |
Document Quarterly Report | true | |
Document Transition Report | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Investments: | ||
Equity securities | $ 3,413,525 | $ 3,683,820 |
Debt securities, fair value | 15,558,624 | 16,061,560 |
Short-term investments | 1,305,804 | 1,142,258 |
Marketable Securities, Total | 20,277,953 | 20,887,638 |
Commercial mortgage loans | 462,556 | 475,860 |
Other invested assets | 561,195 | 557,800 |
Total investments | 21,301,704 | 21,921,298 |
Cash | 993,056 | 927,966 |
Accrued investment income | 93,895 | 87,610 |
Premium balances receivable | 1,528,474 | 1,458,679 |
Reinsurance recoverables | 2,164,653 | 2,195,975 |
Ceded unearned premiums | 483,088 | 463,412 |
Deferred acquisition costs | 636,654 | 586,753 |
Property and equipment at cost, net of accumulated depreciation and amortization | 303,591 | 304,452 |
Goodwill | 754,648 | 753,607 |
Intangible assets, net of amortization | 909,420 | 924,406 |
Net deferred tax assets | 104,966 | 0 |
Funds held under reinsurance agreements | 506,005 | 634,182 |
Other assets | 2,114,273 | 2,010,335 |
Total assets | 31,894,427 | 32,268,675 |
Liabilities, Redeemable Noncontrolling Interests and Stockholders’ Equity | ||
Loss and loss adjustment expenses | 14,316,367 | 14,357,635 |
Unearned premiums | 3,386,395 | 3,179,513 |
Senior notes and other debt | 2,822,777 | 2,847,199 |
Reinsurance payable | 360,919 | 322,902 |
Current taxes payable | 63,912 | 34,297 |
Net deferred tax liabilities | 0 | 56,958 |
Other liabilities | 1,982,891 | 1,965,943 |
Total liabilities | 22,933,261 | 22,764,447 |
Redeemable noncontrolling interests | 365,793 | 317,346 |
Common stock | 17,460 | 17,460 |
Contributed capital | 3,593,370 | 3,608,905 |
Accumulated other comprehensive (loss) income | (464,460) | 141,822 |
Treasury stock | (2,029,904) | (1,934,531) |
Retained earnings | 7,478,907 | 7,353,226 |
Total stockholders’ equity attributable to Alleghany stockholders | 8,595,373 | 9,186,882 |
Total liabilities, redeemable noncontrolling interests and stockholders’ equity | $ 31,894,427 | $ 32,268,675 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Equity securities, cost | $ 2,400,563 | $ 2,552,722 |
Debt securities, amortized cost | 15,993,207 | 15,727,143 |
Allowance for credit losses | $ 1,084 | $ 502 |
Common stock, Shares authorized | 22,000,000 | 22,000,000 |
Common stock, Shares issued | 17,459,961 | 17,459,961 |
Treasury stock, shares | 4,005,073 | 3,861,426 |
Consolidated Statements of Earn
Consolidated Statements of Earnings and Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenues | ||
Net premiums earned | $ 1,605,458 | $ 1,604,763 |
Net investment income | 113,476 | 153,484 |
Change in the fair value of equity securities | (138,777) | 112,728 |
Net realized capital gains | (10,003) | 12,931 |
Change in allowance for credit losses on available for sale securities | (582) | 1,972 |
Product and service revenues | 1,149,162 | 767,835 |
Total revenues | 2,718,734 | 2,653,713 |
Costs and Expenses | ||
Net loss and loss adjustment expenses | 941,787 | 1,112,070 |
Commissions, brokerage and other underwriting expenses | 477,165 | 476,036 |
Other operating expenses | 1,028,892 | 723,889 |
Corporate administration | 10,723 | 9,558 |
Amortization of intangible assets | 14,082 | 11,478 |
Interest expense | 32,110 | 23,752 |
Total costs and expenses | 2,504,759 | 2,356,783 |
Earnings before income taxes | 213,975 | 296,930 |
Income taxes | 45,082 | 58,867 |
Net earnings | 168,893 | 238,063 |
Net earnings attributable to noncontrolling interest | 43,212 | 8,022 |
Net earnings attributable to Alleghany stockholders | 125,681 | 230,041 |
Net earnings | 168,893 | 238,063 |
Other comprehensive income (loss): | ||
Change in unrealized gains, net of deferred taxes of ($163,282) and ($57,932) in 2022 and 2021, respectively | (614,251) | (217,935) |
Change in unrealized currency translation adjustment, net of deferred taxes of ($139) and $654 for 2022 and 2021, respectively | (523) | 2,461 |
Retirement plans | 130 | (965) |
Comprehensive (loss) income | (437,389) | 9,851 |
Comprehensive income attributable to noncontrolling interests | 43,212 | 8,022 |
Comprehensive (loss) income attributable to Alleghany stockholders | $ (480,601) | $ 1,829 |
Basic earnings per share attributable to Alleghany stockholders | $ 9.29 | $ 16.44 |
Diluted earnings per share attributable to Alleghany stockholders | $ 9.29 | $ 16.37 |
Accumulated Net Unrealized Investment Gain Loss | ||
Other comprehensive income (loss): | ||
Less: reclassification for net realized capital gains and change in allowance for credit losses on available for sale securities, net of taxes of $2,223 and ($3,130) for 2022 and 2021, respectively | $ 8,362 | $ (11,773) |
Consolidated Statements of Ea_2
Consolidated Statements of Earnings and Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Change in unrealized gains, deferred taxes | $ (163,282) | $ (57,932) |
Change in unrealized currency translation adjustment, deferred taxes | (139) | 654 |
Accumulated Net Unrealized Investment Gain Loss | ||
Reclassification for net realized capital gains and change in allowance for credit losses on available for sale securities, taxes | $ 2,223 | $ (3,130) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Contributed Capital | Accumulated Other Comprehensive Income (loss) | Treasury Stock | Retained Earnings |
Beginning Balance at Dec. 31, 2020 | $ 8,755,720 | $ 17,460 | $ 3,613,454 | $ 452,402 | $ (1,645,930) | $ 6,318,334 |
Net earnings | 230,041 | 0 | 0 | 0 | 0 | 230,041 |
Other comprehensive income (loss), net of tax: | ||||||
Retirement plans | (965) | 0 | 0 | (965) | 0 | 0 |
Change in unrealized appreciation of investments, net | (229,708) | 0 | 0 | (229,708) | 0 | 0 |
Change in unrealized currency translation adjustment, net | 2,461 | 0 | 0 | 2,461 | 0 | 0 |
Comprehensive (loss) income attributable to Alleghany stockholders | 1,829 | 0 | 0 | (228,212) | 0 | 230,041 |
Treasury stock repurchase | (63,192) | 0 | 0 | 0 | (63,192) | 0 |
Other, net | 1,524 | 0 | 310 | 0 | 1,214 | 0 |
Ending Balance at Mar. 31, 2021 | 8,695,881 | 17,460 | 3,613,764 | 224,190 | (1,707,908) | 6,548,375 |
Redeemable noncontrolling interests balance at Dec. 31, 2020 | 233,809 | |||||
Redeemable Non-controlling Interests | ||||||
Net earnings (losses) attributable to redeemable noncontrolling interests | 8,022 | |||||
Retirement plans attributable to redeemable noncontrolling interests | 0 | |||||
Change in unrealized appreciation of investments, net, attributable to redeemable noncontrolling interests | 0 | |||||
Change in unrealized currency translation adjustment, net, attributable to redeemable noncontrolling interests | 0 | |||||
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest | 8,022 | |||||
Other net changes to redeemable noncontrolling interests | (8,268) | |||||
Redeemable noncontrolling interests balance at Mar. 31, 2021 | 233,563 | |||||
Beginning Balance at Dec. 31, 2021 | 9,186,882 | 17,460 | 3,608,905 | 141,822 | (1,934,531) | 7,353,226 |
Net earnings | 125,681 | 0 | 0 | 0 | 0 | 125,681 |
Other comprehensive income (loss), net of tax: | ||||||
Retirement plans | 130 | 0 | 0 | 130 | 0 | 0 |
Change in unrealized appreciation of investments, net | (605,889) | 0 | 0 | (605,889) | 0 | 0 |
Change in unrealized currency translation adjustment, net | (523) | 0 | 0 | (523) | 0 | 0 |
Comprehensive (loss) income attributable to Alleghany stockholders | (480,601) | 0 | 0 | (606,282) | 0 | 125,681 |
Treasury stock repurchase | (95,987) | 0 | 0 | 0 | (95,987) | 0 |
Other, net | (14,921) | 0 | (15,535) | 0 | 614 | 0 |
Ending Balance at Mar. 31, 2022 | 8,595,373 | $ 17,460 | $ 3,593,370 | $ (464,460) | $ (2,029,904) | $ 7,478,907 |
Redeemable noncontrolling interests balance at Dec. 31, 2021 | 317,346 | |||||
Redeemable Non-controlling Interests | ||||||
Net earnings (losses) attributable to redeemable noncontrolling interests | 43,212 | |||||
Retirement plans attributable to redeemable noncontrolling interests | 0 | |||||
Change in unrealized appreciation of investments, net, attributable to redeemable noncontrolling interests | 0 | |||||
Change in unrealized currency translation adjustment, net, attributable to redeemable noncontrolling interests | 0 | |||||
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest | 43,212 | |||||
Other net changes to redeemable noncontrolling interests | 5,235 | |||||
Redeemable noncontrolling interests balance at Mar. 31, 2022 | $ 365,793 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - shares | Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Stockholders' Equity [Abstract] | ||||
Common stock, Shares issued | 17,459,961 | 17,459,961 | 17,459,961 | 17,459,961 |
Treasury stock, shares | 4,005,073 | 3,861,426 | 3,519,292 | 3,418,781 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash flows from operating activities | ||
Net earnings | $ 168,893 | $ 238,063 |
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 45,109 | 43,554 |
Change in the fair value of equity securities | 138,777 | (112,728) |
Net realized capital (gains) losses | 10,003 | (12,931) |
Change in allowance for credit losses on available for sale securities | 582 | (1,972) |
(Increase) decrease in reinsurance recoverables, net of reinsurance payable | 69,339 | (6,669) |
(Increase) decrease in premium balances receivable | (69,795) | (138,822) |
(Increase) decrease in ceded unearned premiums | (19,676) | (34,049) |
(Increase) decrease in deferred acquisition costs | (49,901) | (41,969) |
(Increase) decrease in funds held under reinsurance agreements | 128,177 | 8,951 |
Increase (decrease) in unearned premiums | 206,882 | 192,735 |
Increase (decrease) in loss and loss adjustment expenses | (41,268) | 322,420 |
Change in unrealized foreign currency exchange rate losses (gains) | 34,879 | 44,344 |
Other, net | (111,098) | (58,632) |
Net adjustments | 342,010 | 204,232 |
Net cash provided by operating activities | 510,903 | 442,295 |
Cash flows from investing activities | ||
Purchases of debt securities | (1,527,777) | (1,401,010) |
Purchases of equity securities | (147,826) | (746,350) |
Sales of debt securities | 778,330 | 1,197,630 |
Maturities and redemptions of debt securities | 426,106 | 552,933 |
Sales of equity securities | 276,605 | 262,690 |
Net (purchases) sales of short-term investments | (163,620) | 117,295 |
Net (purchases) sales and maturities of commercial mortgage loans | 13,304 | 30,618 |
(Purchases) sales of property and equipment | (14,249) | (12,322) |
Purchases of affiliates and subsidiaries, net of cash acquired | 0 | 0 |
Other, net | 56,101 | 101,159 |
Net cash (used in) provided by investing activities | (303,026) | 102,643 |
Cash flows from financing activities | ||
Treasury stock acquisitions | (95,987) | (63,192) |
Increase (decrease) in other debt | (24,820) | (55,729) |
Other, net | (13,992) | (8,938) |
Net cash used in financing activities | (134,799) | (127,859) |
Effect of foreign exchange rate changes on cash | (7,988) | (11,047) |
Net increase in cash | 65,090 | 406,032 |
Cash at beginning of period | 927,966 | 791,442 |
Cash at end of period | 993,056 | 1,197,474 |
Supplemental disclosures of cash flow information | ||
Interest paid | 19,243 | 10,000 |
Income taxes paid | $ 13,766 | $ 22,599 |
Summary of Significant Accounti
Summary of Significant Accounting Principles | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Principles | 1. Summary of Significant Accounting Principles (a) Principles of Financial Statement Presentation This Quarterly Report on Form 10-Q (this “Form 10-Q”) should be read in conjunction with the Annual Report on Form 10-K for the year ended December 31, 2021 (the “2021 Form 10-K”) of Alleghany Corporation (“Alleghany”). Alleghany, a Delaware corporation, owns and supports certain operating subsidiaries and manages investments, anchored by a core position in property and casualty reinsurance and insurance. Through its wholly-owned subsidiary Transatlantic Holdings, Inc. (“TransRe”), an Alleghany subsidiary since March 2012, Alleghany is engaged in the property and casualty reinsurance business. Through its wholly-owned subsidiary Alleghany Insurance Holdings LLC (“AIHL”), Alleghany is engaged in the property and casualty insurance business. AIHL’s insurance operations are principally conducted by its subsidiaries RSUI Group, Inc. (“RSUI”) and CapSpecialty, Inc. (“CapSpecialty”). RSUI and CapSpecialty have been subsidiaries of AIHL since July 2003 and January 2002, respectively. AIHL Re LLC (“AIHL Re”), a captive reinsurance company, which provides reinsurance to Alleghany’s current and former insurance operating subsidiaries and affiliates, has been a subsidiary of Alleghany since its formation in May 2006. Although Alleghany’s primary sources of revenues and earnings are its reinsurance and insurance operations and investments, Alleghany also generates revenues and expenses from a diverse portfolio of non-financial businesses that are owned and supported through its wholly-owned subsidiary Alleghany Capital Corporation (“Alleghany Capital”). Alleghany Capital’s businesses include: • Precision Cutting Technologies, Inc. (“PCT”), a holding company headquartered in Rockford, Illinois, with four operating businesses: (i) Bourn & Koch, Inc., a provider of precision automated machine tool solutions; (ii) Diamond Technology Innovations, Inc., a manufacturer of waterjet orifices and nozzles and a provider of related services; (iii) Coastal Industrial Distributors, LLC, a provider of high-performance solid carbide end mills; and (iv) Supermill LLC, a manufacturer of high-performance solid carbide end mills; • R.C. Tway Company, LLC (“Kentucky Trailer”), a manufacturer of custom trailers and truck bodies for the moving and storage industry and other markets, headquartered in Louisville, Kentucky; • IPS-Integrated Project Services, LLC (“IPS”), a global provider of design, engineering and related services to the biopharmaceutical and life sciences markets, and cost and project management services for clients in the data center, technology and other sectors, headquartered in Blue Bell, Pennsylvania; • Jazwares, LLC (together with its affiliates, “Jazwares”), a global toy company, headquartered in Sunrise, Florida; • WWSC Holdings, LLC (“W&W|AFCO Steel”), a structural steel fabricator and erector, headquartered in Oklahoma City, Oklahoma; • CHECO Holdings, LLC (“Concord”), a hotel management and development company, headquartered in Raleigh, North Carolina; • Wilbert Funeral Services, Inc. (“Wilbert”), a provider of products and services for the funeral and cemetery industries and precast concrete markets, headquartered in Overland Park, Kansas; and • Piedmont Manufacturing Group, LLC (“Piedmont”), a provider of injection molded and thermoformed parts and multi-component assemblies for original equipment manufacturer customers in a range of end-markets, headquartered in Belmont, North Carolina. The results of Piedmont have been included in Alleghany’s consolidated results from its formation and subsequent acquisition of Wilbert, Inc., doing business as Wilbert Plastic Services (“WPS”) on May 10, 2021. In addition, Alleghany owns certain other holding-company investments. Alleghany’s wholly-owned subsidiary Alleghany Properties Holdings LLC (“Alleghany Properties”) owns and manages certain properties in the Sacramento, California region. Alleghany’s public equity investments are managed primarily through Alleghany’s wholly-owned subsidiary Roundwood Asset Management LLC. On March 20, 2022, Alleghany entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Berkshire Hathaway Inc., a Delaware corporation (“Berkshire”) and O&M Acquisition Corp., a Delaware corporation and a wholly-owned subsidiary of Berkshire (“Merger Sub”). Pursuant to the Merger Agreement and subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub will be merged with and into Alleghany, with Alleghany continuing as the surviving corporation and a wholly-owned subsidiary of Berkshire (“Merger”). As a result of the Merger, each issued and outstanding share of Alleghany's common stock, par value $ 1.00 per share (the “Common Stock”) (other than shares (a) held in the treasury of Alleghany or owned by Berkshire or any direct or indirect wholly-owned subsidiary of Berkshire or (b) held by a stockholder who has demanded and perfected such holder's demand for appraisal rights in accordance with Delaware law) will be cancelled and extinguished and converted into the right to receive $ 848.02 in cash, without interest, representing a total equity value of approximately $ 11.6 billion. The closing of the Merger is subject to certain conditions, including (i) the approval and adoption of the Merger Agreement by the holders of at least 75 % of the voting power of the outstanding shares of Common Stock, (ii) the expiration or termination of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and applicable foreign antitrust laws, (iii) the receipt of authorizations required to be obtained from applicable insurance regulators and (iv) other customary closing conditions. The Merger Agreement generally requires Alleghany to operate its business in the ordinary course pending consummation of the proposed Merger and restricts Alleghany, without Berkshire’s consent, from taking certain specified actions until the Merger is completed. For a description of the treatment of equity awards under the Merger Agreement, see Alleghany’s definitive proxy statement filed with the SEC on April 29, 2022. Unless the context otherwise requires, references to “Alleghany” include Alleghany together with its subsidiaries. The accompanying consolidated financial statements include the results of Alleghany and its wholly-owned and majority-owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”). All material inter-company balances and transactions have been eliminated in consolidation. The portion of stockholders’ equity, net earnings and comprehensive income that is not attributable to Alleghany stockholders is presented on the consolidated balance sheets, the consolidated statements of earnings and comprehensive income and the consolidated statements of changes in stockholders’ equity as noncontrolling interests. Because all noncontrolling interests have the option to sell their ownership interests to Alleghany in the future (generally through 2028), the portion of stockholders’ equity that is not attributable to Alleghany stockholders is presented on the consolidated balance sheets and the consolidated statements of changes in stockholders’ equity as redeemable noncontrolling interests for all periods presented. In addition, Alleghany accretes the redeemable noncontrolling interests up to their future estimated redemption value over the period from the date of issuance to the earliest redemption date. The redemption value of the equity interests is generally based on the subsidiary’s earnings in specified periods preceding the applicable redemption date, calculated based on either a specified formula or an independent fair market valuation. Accretion related to redemption values based on a specified formula are recorded as a component of net earnings attributable to noncontrolling interests, whereas accretion related to redemption values based on an independent fair market valuation are recorded as a component of contributed capital. Accretion may increase or decrease each period, however, the redeemable noncontrolling interest balance may not go below the initial balance established at the acquisition date. The following table presents the components of net earnings attributable to noncontrolling interests for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Accretion of redeemable noncontrolling interests $ 18.8 $ 0.6 Portion of net earnings attributable to noncontrolling interests 24.4 7.5 Total $ 43.2 $ 8.1 In addition, accretion reduced contributed capital by $ 16.5 million and $ 0.0 million fo r the three months ended March 31, 2022 and 2021, respectively. Such accretion may be adjusted later in 2022 as certain significant noncontrolling interest holders have the right to put their respective equity interests to Alleghany Capital. The difference between any actual payouts that may be negotiated and agreed, as compared to the carrying value of such noncontrolling interests, will be recorded as accretion and charged to contributed capital. As of March 31, 2022, the noncontrolling interests outstanding were approximately as follows: Kentucky Trailer - 22 percent; IPS - 18 percent; Jazwares - 24 percent; W&W|AFCO Steel - 20 percent; and Concord - 15 percent. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Alleghany relies on historical experience and on various other assumptions that it believes to be reasonable under the circumstances to make judgments about the carrying value of assets and liabilities and reported revenues and expenses that are not readily apparent from other sources. Actual results may differ materially from those reported results to the extent that those estimates and assumptions prove to be inaccurate. Changes in estimates are reflected in the consolidated statements of earnings and comprehensive income in the period in which the changes are made. (b) Other Significant Accounting Principles Alleghany’s significant accounting principles can be found in Note 1 to Notes to Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of the 2021 Form 10-K. (c) Recent Accounting Standards Recently Adopted In August 2020, the Financial Accounting Standards Board (the “FASB”) issued guidance that simplifies the accounting and disclosure requirements for certain financial instruments with characteristics of liabilities and equity, such as convertible debt and convertible preferred stock. This guidance also modifies the accounting for certain contracts involving an entity’s own stock. This guidance was effective in the first quarter of 2022 for public companies, with early adoption permitted. Alleghany adopted this guidance in the first quarter of 2022 and the adoption did not have a material impact on its results of operations and financial condition. In May 2021, the FASB issued guidance on how issuers should account for modifications or exchanges of freestanding equity-classified written call options that remain classified as equity after the modification or exchange. Under this guidance, the issuer will determine the accounting for the modification or exchange based on the economic substance of the modification or exchange (i.e. to issue equity, to issue or modify debt, or other reasons). This guidance was effective in the first quarter of 2022 for all entities, with early adoption permitted when applied as of the beginning of the fiscal year. Alleghany adopted this guidance in the first quarter of 2022 and the adoption did not have a material impact on its results of operations and financial condition. Future Application of Accounting Standards In October 2021, the FASB issued guidance related to contract assets and liabilities recorded in a business combination. A contract asset is recorded when the amount of goods or services transferred to a customer exceed the amount received or receivable from the customer, and a contract liability is recorded when the amount received or receivable from a customer exceeds the amount of goods or services transferred to the customer. The guidance requires that the acquirer of a business determine and record a customer contract asset or liability it would have recorded if the acquirer had entered into the original contract with the customer at the same date and at the same terms as the acquiree using preexisting revenue recognition guidance. Under current guidance, contract assets and liabilities are recorded at acquisition date fair value. As a result of this guidance, the acquisition date recognition and measurement of customer contract assets and liabilities will likely be similar to the acquiree carrying values, and post-acquisition revenue recognition will likely be similar to what the acquiree would have recorded. This guidance is effective for public companies for business acquisitions completed on or after January 1, 2023, with early adoption permitted subject to certain conditions and requirements. Alleghany will adopt this guidance for business acquisitions completed on or after January 1, 2023 and does not currently believe that the implementation will have a material impact on its results of operations and financial condition. In March 2022, the FASB issued guidance on credit losses. Under this guidance, all loan and receivable modifications, including modifications made for borrowers experiencing financial difficulty, shall be accounted for using the current expected credit loss model (the “Model”). This guidance applies to entities that have previously adopted the Model. Entities that have not yet adopted the Model will continue to use pre-existing accounting rules. This guidance also expands disclosure requirements for modifications made for borrowers experiencing financial difficulty. This guidance is effective in the first quarter of 2023 for public companies, with early adoption permitted. Alleghany previously adopted the Model in the first quarter of 2020 and will adopt this guidance in the first quarter of 2023. Alleghany does not currently believe that the implementation will have a material impact on its results of operations and financial condition. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 2. Fair Value of Financial Instruments The following table presents the carrying value and estimated fair value of Alleghany’s consolidated financial instruments as of March 31, 2022 and December 31, 2021: March 31, 2022 December 31, 2021 Carrying Value Fair Value Carrying Value Fair Value ($ in millions) Assets Investments (excluding equity method investments and loans) (1) $ 20,277.9 $ 20,277.9 $ 20,887.7 $ 20,887.7 Liabilities Senior notes and other debt (2) $ 2,822.8 $ 2,950.2 $ 2,847.2 $ 3,157.9 (1) This table includes debt and equity securities, as well as partnership and non-marketable equity investments accounted for at fair value that are included in other invested assets. This table excludes investments accounted for using the equity method and commercial mortgage loans that are accounted for at unpaid principal balance. The fair value of short-term investments approximates amortized cost. (2) See Note 8 to Notes to Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of the 2021 Form 10-K for additional information on the senior notes and other debt. The following tables present Alleghany’s financial instruments at fair value and the level of the fair value hierarchy of inputs used as of March 31, 2022 and December 31, 2021: Level 1 Level 2 Level 3 Total ($ in millions) As of March 31, 2022 Equity securities: Common stock $ 3,406.5 $ 2.4 $ — $ 3,408.9 Preferred stock — 3.3 1.3 4.6 Total equity securities 3,406.5 5.7 1.3 3,413.5 Debt securities: U.S. Government obligations — 1,593.0 — 1,593.0 Municipal bonds — 2,641.9 — 2,641.9 Foreign government obligations — 818.0 — 818.0 U.S. corporate bonds — 2,676.8 674.0 3,350.8 Foreign corporate bonds — 997.0 189.4 1,186.4 Mortgage and asset-backed securities: Residential mortgage-backed securities (“RMBS”) (1) — 1,830.1 1.8 1,831.9 Commercial mortgage-backed securities (“CMBS”) — 1,044.4 4.3 1,048.7 Other asset-backed securities (2) — 1,759.1 1,328.8 3,087.9 Total debt securities — 13,360.3 2,198.3 15,558.6 Short-term investments — 1,305.8 — 1,305.8 Total investments (excluding equity method investments and loans) $ 3,406.5 $ 14,671.8 $ 2,199.6 $ 20,277.9 Senior notes and other debt $ — $ 2,194.2 $ 756.0 $ 2,950.2 Level 1 Level 2 Level 3 Total ($ in millions) As of December 31, 2021 Equity securities: Common stock $ 3,677.1 $ 2.1 $ — $ 3,679.2 Preferred stock — 3.3 1.3 4.6 Total equity securities 3,677.1 5.4 1.3 3,683.8 Debt securities: U.S. Government obligations — 2,050.7 — 2,050.7 Municipal bonds — 2,535.9 — 2,535.9 Foreign government obligations — 854.9 — 854.9 U.S. corporate bonds — 2,807.0 670.3 3,477.3 Foreign corporate bonds — 1,049.7 177.2 1,226.9 Mortgage and asset-backed securities: RMBS (1) — 2,007.1 1.9 2,009.0 CMBS — 905.9 — 905.9 Other asset-backed securities (2) — 1,652.7 1,348.3 3,001.0 Total debt securities — 13,863.9 2,197.7 16,061.6 Short-term investments — 1,142.3 — 1,142.3 Total investments (excluding equity method investments and loans) $ 3,677.1 $ 15,011.6 $ 2,199.0 $ 20,887.7 Senior notes and other debt $ — $ 2,377.4 $ 780.5 $ 3,157.9 (1) Primarily includes government agency pass-through securities guaranteed by a government agency or government sponsored enterprise, among other types of RMBS. (2) Include s $ 1,281.5 million an d $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. In the three months ended March 31, 2022, Alleghany did not transfer any financial instruments into Level 3. In the three months ended March 31, 2022, Alleghany transferred out of Leve l 3 $ 18.3 million of financial instruments, principally due to an increase in observable inputs related to the valuation of such assets. Specifically, during the first three months of 2022, there was a decrease in the weight given to non-binding broker quotes and, as a result, there was a corresponding increase in quoted prices for similar assets in active markets. All of the $ 18.3 million of transfers related to other asset-backed securities. In the three months ended March 31, 2021, Alleghany transferred into Level 3 $ 5.8 million of financial instruments, principally due to a decrease in observable inputs related to the valuation of such assets. Specifically, during the first three months of 2021, there was an increase in the weight given to non-binding broker quotes and, as a result, there was a corresponding decrease in quoted prices for similar assets in active markets. All of the $ 5.8 million of transfers related to other asset-backed securities. In the three months ended March 31, 2021, Alleghany transferred out of Level 3 $ 10.9 million of financial instruments, principally due to an increase in observable inputs related to the valuation of such assets. Specifically, during the first three months of 2021, there was a decrease in the weight given to non-binding broker quotes and, as a result, there was a corresponding increase in quoted prices for similar assets in active markets. Of the $ 10.9 million of transfers, $ 5.8 million related to CMBS and $ 5.1 million related to other asset-backed securities. The following tables present reconciliations of the changes during the three months ended March 31, 2022 and 2021 in Level 3 assets measured at fair value: Debt Securities Mortgage and asset-backed Three Months Ended March 31, 2022 Preferred U.S. Foreign RMBS CMBS Other Asset- Other (1) Total ($ in millions) Balance as of January 1, 2022 $ 1.3 $ 670.3 $ 177.2 $ 1.9 $ — $ 1,348.3 $ — $ 2,199.0 Net realized/unrealized gains (losses) included in: Net earnings (2) — 0.2 — — — — — 0.2 Other comprehensive (loss) — ( 35.5 ) ( 10.0 ) — — ( 12.2 ) — ( 57.7 ) Purchases — 43.3 24.3 — 4.3 62.5 — 134.4 Sales — — — — — ( 28.3 ) — ( 28.3 ) Issuances — — — — — — — — Settlements — ( 4.3 ) ( 2.1 ) ( 0.1 ) — ( 23.2 ) — ( 29.7 ) Transfers into Level 3 — — — — — — — — Transfers out of Level 3 — — — — — ( 18.3 ) — ( 18.3 ) Balance as of March 31, 2022 $ 1.3 $ 674.0 $ 189.4 $ 1.8 $ 4.3 $ 1,328.8 $ — $ 2,199.6 Debt Securities Mortgage and asset-backed Three Months Ended March 31, 2021 Preferred U.S. Foreign RMBS CMBS Other Asset- Other (1) Total ($ in millions) Balance as of January 1, 2021 $ 1.3 $ 631.6 $ 189.5 $ 2.5 $ 5.8 $ 902.7 $ 0.3 $ 1,733.7 Net realized/unrealized gains (losses) included in: Net earnings (2) — 0.2 — — — 0.1 0.1 0.4 Other comprehensive income (loss) — ( 17.1 ) ( 3.9 ) — — 6.7 ( 0.1 ) ( 14.4 ) Purchases — 19.6 2.0 — — 192.2 — 213.8 Sales — — — — — ( 0.1 ) ( 0.3 ) ( 0.4 ) Issuances — — — — — — — — Settlements — ( 23.6 ) ( 1.2 ) ( 0.2 ) — ( 88.1 ) — ( 113.1 ) Transfers into Level 3 — — — — — 5.8 — 5.8 Transfers out of Level 3 — — — — ( 5.8 ) ( 5.1 ) — ( 10.9 ) Balance as of March 31, 2021 $ 1.3 $ 610.7 $ 186.4 $ 2.3 $ — $ 1,014.2 $ — $ 1,814.9 (1) Includes partnership and non-marketable equity investments accounted for at fair value. (2) There wer e minimal or no credit losses recorded in net earnings related to Level 3 instruments still held as of March 31, 2022 and 2021. With respect to changes in Level 3 liabilities during the first three months of 2022, the decrease in senior notes and other debt reflects decreased borrowings at Alleghany Capital subsidiaries due to a reduction in working capital needs. Although Alleghany is responsible for the determination of the fair value of Alleghany’s financial assets and the supporting methodologies and assumptions, it employs third-party valuation service providers to gather, analyze and interpret market information and derive fair values based upon relevant methodologies and assumptions for individual instruments. When those providers are unable to obtain sufficient market observable information upon which to estimate the fair value for a particular security, fair value is determined either by requesting a quote, which is generally non-binding, from brokers who are knowledgeable about these securities or by employing widely accepted valuation models. As of March 31, 2022 and December 31, 2021, the fair value for the vast majority of debt securities included in Level 3 was provided by such third-party valuation service providers, and as such, valuation details on these securities are generally not available to Alleghany. Alleghany employs specific control processes to determine the reasonableness of the fair values of its financial assets and liabilities. Alleghany’s processes are designed to ensure that the values received or internally estimated are accurately recorded and that the data inputs and the valuation techniques used are appropriate, consistently applied and that the assumptions are reasonable and consistent with the objective of determining fair value. Alleghany assesses the reasonableness of individual security values received from valuation service providers through various analytical techniques. In addition, Alleghany validates the reasonableness of fair values by comparing information obtained from Alleghany’s valuation service providers to other third-party valuation sources for selected securities. Alleghany also validates prices obtained from brokers for selected securities through reviews by those who have relevant expertise and who are independent of those charged with executing investing transactions. See Note 1(c) to Notes to Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of the 2021 Form 10-K for Alleghany’s accounting policy on fair value. |
Investments
Investments | 3 Months Ended |
Mar. 31, 2022 | |
Investments [Abstract] | |
Investments | 3. Investments (a) Unrealized Gains and Losses The following tables present the amortized cost and the fair value of AFS securities as of March 31, 2022 and December 31, 2021: Amortized Gross Gross Allowance for Credit Losses Fair Value ($ in millions) As of March 31, 2022 Debt securities: U.S. Government obligations $ 1,649.9 $ 4.0 $ ( 60.9 ) $ — $ 1,593.0 Municipal bonds 2,673.2 39.2 ( 70.5 ) — 2,641.9 Foreign government obligations 844.1 1.7 ( 27.8 ) — 818.0 U.S. corporate bonds 3,421.9 44.4 ( 115.0 ) ( 0.5 ) 3,350.8 Foreign corporate bonds 1,232.6 2.8 ( 48.4 ) ( 0.6 ) 1,186.4 Mortgage and asset-backed securities: RMBS 1,922.0 9.1 ( 99.2 ) — 1,831.9 CMBS 1,068.4 1.9 ( 21.6 ) — 1,048.7 Other asset-backed securities (1) 3,181.1 3.1 ( 96.3 ) — 3,087.9 Total debt securities 15,993.2 106.2 ( 539.7 ) ( 1.1 ) 15,558.6 Short-term investments 1,305.8 — — — 1,305.8 Total investments $ 17,299.0 $ 106.2 $ ( 539.7 ) $ ( 1.1 ) $ 16,864.4 Amortized Gross Gross Allowance for Credit Losses Fair Value ($ in millions) As of December 31, 2021 Debt securities: U.S. Government obligations $ 2,039.7 $ 27.9 $ ( 16.9 ) $ — $ 2,050.7 Municipal bonds 2,412.7 127.3 ( 4.1 ) — 2,535.9 Foreign government obligations 850.8 12.0 ( 7.9 ) — 854.9 U.S. corporate bonds 3,336.9 159.2 ( 18.3 ) ( 0.5 ) 3,477.3 Foreign corporate bonds 1,216.6 19.9 ( 9.6 ) — 1,226.9 Mortgage and asset-backed securities: RMBS 1,993.6 37.2 ( 21.8 ) — 2,009.0 CMBS 879.8 28.3 ( 2.2 ) — 905.9 Other asset-backed securities (1) 2,997.0 22.0 ( 18.0 ) — 3,001.0 Total debt securities 15,727.1 433.8 ( 98.8 ) ( 0.5 ) 16,061.6 Short-term investments 1,142.3 — — — 1,142.3 Total investments $ 16,869.4 $ 433.8 $ ( 98.8 ) $ ( 0.5 ) $ 17,203.9 (1) Includ es $ 1,281.5 million and $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. (b) Contractual Maturity The following table presents the amortized cost and estimated fair value of debt securities by contractual maturity as of March 31, 2022. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Cost Fair Value ($ in millions) As of March 31, 2022 Short-term investments due in one year or less $ 1,305.8 $ 1,305.8 Mortgage and asset-backed securities (1) 6,171.5 5,968.5 Debt securities with maturity dates: One year or less 557.1 557.6 Over one through five years 3,625.9 3,556.2 Over five through ten years 3,053.7 2,938.8 Over ten years 2,585.0 2,537.5 Total debt securities $ 15,993.2 $ 15,558.6 (1) Mortgage and asset-backed securities by their nature do not generally have single maturity dates. (c) Net Investment Income The following table presents net investment income for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Interest income $ 100.3 $ 99.9 Dividend income 12.7 16.7 Investment expenses ( 7.2 ) ( 6.0 ) Partnerships and other investment results 7.7 42.9 Total $ 113.5 $ 153.5 As of March 31, 2022, non-income producing invested assets were immaterial. (d) Change in the Fair Value of Equity Securities The proceeds from sales of equity securities wer e $ 0.3 billion and $ 0.3 billion for the three months ended March 31, 2022 and 2021, respectively. The following table presents changes in the fair value of equity securities for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Change in the fair value of equity securities sold during the period $ ( 18.2 ) $ ( 3.2 ) Change in the fair value of equity securities held at the end of the period ( 120.7 ) 115.9 Change in the fair value of equity securities $ (138.9 ) $ 112.7 (e) Realized Gains and Losses The proceeds from sales of debt securities w ere $ 0.8 billion a nd $ 1.2 billion for the three months ended March 31, 2022 and 2021, respectively. Realized capital gains and losses for the three months ended March 31, 2022 and 2021 primarily reflect the sale of debt securities. The following table presents amounts of gross realized capital gains and gross realized capital losses for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Gross realized capital gains $ 11.2 $ 20.9 Gross realized capital losses ( 21.2 ) ( 8.0 ) Net realized capital gains $ ( 10.0 ) $ 12.9 Gross realized loss amounts exclude change in allowance for credit losses on AFS securities, as discussed below. (f) Credit quality for AFS securities Alleghany holds its debt securities as AFS and, as such, these securities are recorded at fair value. Credit losses on AFS securities are recorded through an allowance for credit losses. Changes in the allowance for credit losses are recorded for (or as a reversal of) credit losses on AFS securities. Any portion of a decline in fair value related to a debt security that is believed to arise from factors other than credit is recorded as a component of other comprehensive income rather than charged against earnings. Alleghany continually monitors the difference between amortized cost and the estimated fair value of its debt investments. The analysis of a security’s decline in value is performed in its functional currency. Debt securities in an unrealized loss position are evaluated for credit losses if they meet any of the following criteria: (i) they are trading at a discount of at least 20 percent to amortized cost and have a credit rating below investment grade or are not rated; (ii) there has been a negative credit or news event with respect to the issuer that could indicate the existence of a credit loss; or (iii) Alleghany intends to sell, or it is more likely than not that Alleghany will sell, the debt security before recovery of its amortized cost basis. If Alleghany intends to sell, or it is more likely than not that Alleghany will sell, a debt security before recovery of its amortized cost basis, the total amount of the unrealized loss position is recognized as a credit loss in earnings. To the extent that a debt security that is in an unrealized loss position is not impaired based on the preceding, Alleghany will consider a debt security to be impaired when it believes it to be probable that Alleghany will not be able to collect the entire amortized cost basis. For debt securities in an unrealized loss position as of the end of each quarter, Alleghany develops a best estimate of the present value of expected cash flows. If the results of the cash flow analysis indicate that Alleghany will not recover the full amount of its amortized cost basis in the debt security, Alleghany records a credit loss in earnings equal to the difference between the present value of expected cash flows and the amortized cost basis of the debt security. If applicable, the difference between the total unrealized loss position on the debt security and the total loss recognized in earnings is the non-credit related portion, which is recorded as a component of other comprehensive income. In developing the cash flow analyses for debt securities, Alleghany considers various factors for the different categories of debt securities. For municipal bonds, Alleghany takes into account the taxing power of the issuer, source of revenue, credit risk and enhancements and pre-refunding. For mortgage and asset-backed securities, Alleghany discounts its best estimate of future cash flows at an effective rate equal to the original effective yield of the security or, in the case of floating rate securities, at the current coupon. Alleghany’s models include assumptions about prepayment speeds, default and delinquency rates, underlying collateral (if any), credit ratings, credit enhancements and other observable market data. For corporate bonds, Alleghany reviews business prospects, credit ratings and available information from asset managers and rating agencies for individual securities. Change in allowance for credit losses on AFS securities in the first three months of 2022 reflects $ 0.6 million of unrealized losses related to a decline in creditworthiness of certain foreign corporate bonds. Change in allowance for credit losses on AFS securities in the first three months of 2021 primarily reflects a $ 2.0 million reduction of credit losses on AFS securities from the sale of debt securities. The following table presents a rollforward of Alleghany’s allowance for credit losses on AFS securities for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Allowance for Credit Losses Beginning balance $ 0.5 $ 2.6 Provision for credit losses 0.6 ( 2.0 ) Charge-offs — — Recoveries — — Ending balance $ 1.1 $ 0.6 The gross unrealized investment losses for debt securities as of March 31, 2022 were deemed to be temporary, based on, among other factors: (i) the relative magnitude to which the fair value of these investments had been below cost were not indicative of a credit loss; (ii) the absence of compelling evidence that would cause Alleghany to call into question the financial condition or near-term business prospects of the issuer of the security; and (iii) Alleghany’s ability and intent to hold the security for a period of time sufficient to allow for any anticipated recovery. Alleghany’s methodology for assessing credit losses contains inherent risks and uncertainties which could include, but are not limited to, incorrect assumptions about financial condition, liquidity or future prospects, inadequacy of any underlying collateral and unfavorable changes in economic conditions or social trends, interest rates or credit ratings. Alleghany’s consolidated investment portfolio consists mainly of highly rated and liquid debt and equity securities listed on national securities exchanges. The overall credit quality of the debt securities portfolio is measured using the lowest rating of three large, reputable rating agencies. In this regard, the overall weighted-average credit quality rating of Alleghany’s debt securities portfolio as of March 31, 2022 and December 31, 2021, was AA-. Although a portion of Alleghany’s debt securities, which consists predominantly of municipal bonds, is insured by third-party financial guaranty insurance companies, the impact of such insurance was not significant to the debt securities’ credit quality rating as of March 31, 2022. The following table presents the ratings of Alleghany’s debt securities as of March 31, 2022: Ratings as of March 31, 2022 AAA / Aaa AA / Aa A BBB / Baa Below (1) Total ($ in millions) U.S. Government obligations $ 1.3 $ 1,591.7 $ — $ — $ — $ 1,593.0 Municipal bonds 279.3 1,813.9 462.8 78.1 7.8 2,641.9 Foreign government obligations 361.0 371.8 84.1 1.1 — 818.0 U.S. corporate bonds 14.5 158.3 1,429.0 1,416.9 332.1 3,350.8 Foreign corporate bonds 156.6 65.0 573.1 355.7 36.0 1,186.4 Mortgage and asset-backed securities: RMBS 6.2 1,819.3 0.4 0.8 5.2 1,831.9 CMBS 447.6 368.0 200.6 32.5 — 1,048.7 Other asset-backed securities 1,460.3 677.5 479.9 406.7 63.5 3,087.9 Total debt securities $ 2,726.8 $ 6,865.5 $ 3,229.9 $ 2,291.8 $ 444.6 $ 15,558.6 Percentage of debt securities, before 17.5 % 44.1 % 20.8 % 14.7 % 2.9 % 100.0 % (1) Cons ists of $ 130.6 million of securities rated BB / Ba, $ 188.9 million of securities rated B, $ 31.3 million of securities rated CCC, $ 0.5 million of securities rated CC, $ 2.9 million of securities rated below CC and $ 90.4 million of not rated securities. (g) Aging of Gross Unrealized Losses The following tables present gross unrealized losses and related fair values for Alleghany’s AFS securities before an allowance for credit losses, grouped by duration of time in a continuous unrealized loss position, as of March 31, 2022 and December 31, 2021: Less Than 12 Months 12 Months or More Total Fair Value Gross Fair Value Gross Fair Value Gross ($ in millions) As of March 31, 2022 Debt securities: U.S. Government obligations $ 1,224.2 $ 50.4 $ 149.6 $ 10.5 $ 1,373.8 $ 60.9 Municipal bonds 966.9 67.4 25.3 3.1 992.2 70.5 Foreign government obligations 533.2 16.4 138.6 11.4 671.8 27.8 U.S. corporate bonds 1,633.7 85.1 192.9 29.9 1,826.6 115.0 Foreign corporate bonds 804.4 37.3 110.4 11.1 914.8 48.4 Mortgage and asset-backed securities: RMBS 879.0 48.3 551.9 50.9 1,430.9 99.2 CMBS 830.9 18.7 35.4 2.9 866.3 21.6 Other asset-backed securities 2,355.6 84.7 350.9 11.6 2,706.5 96.3 Total temporarily impaired securities $ 9,227.9 $ 408.3 $ 1,555.0 $ 131.4 $ 10,782.9 $ 539.7 Less Than 12 Months 12 Months or More Total Fair Value Gross Fair Value Gross Fair Value Gross ($ in millions) As of December 31, 2021 Debt securities: U.S. Government obligations $ 1,196.3 $ 11.1 $ 122.1 $ 5.8 $ 1,318.4 $ 16.9 Municipal bonds 267.3 4.0 2.8 0.1 270.1 4.1 Foreign government obligations 350.0 5.3 73.2 2.6 423.2 7.9 U.S. corporate bonds 814.2 12.4 79.3 5.9 893.5 18.3 Foreign corporate bonds 460.6 8.3 34.6 1.3 495.2 9.6 Mortgage and asset-backed securities: RMBS 1,072.8 20.5 50.7 1.3 1,123.5 21.8 CMBS 197.8 0.6 40.9 1.6 238.7 2.2 Other asset-backed securities 1,609.9 13.2 291.5 4.8 1,901.4 18.0 Total temporarily impaired securities $ 5,968.9 $ 75.4 $ 695.1 $ 23.4 $ 6,664.0 $ 98.8 As of March 31, 2022, Alleghany held a total of 3,252 , de bt securities that were in an unrealized loss position, of which 460 securities were in an unrealized loss position continuously for 12 months or more. The unrealized losses associated with these debt securities consisted of losses related primarily to U.S. corporate bonds and other asset-backed securities. (h) Investments in Certain Other Invested Assets In December 2012, TransRe obtained an ownership interest in Pillar Capital Holdings Limited (“Pillar Holdings”), a Bermuda- based insurance asset manager focused on collateralized reinsurance and catastrophe insurance-linked securities. Additionally, TransRe and, to a lesser extent, AIHL invested in limited partnership funds managed by Pillar Holdings (the “Funds”). The objective of the Funds is to create portfolios with attractive risk-reward characteristics and low correlation with other asset classes, using the extensive reinsurance and capital market experience of the principals of Pillar Holdings. Alleghany has concluded that both Pillar Holdings and the Funds (collectively, the “Pillar Investments”) represent variable interest entities and that Alleghany is not the primary beneficiary, as it does not have the ability to direct the activities that most significantly impact each entity’s economic performance. Therefore, the Pillar Investments are not consolidated and are accounted for under the equity method of accounting. Alleghany’s potential maximum loss in the Pillar Investments is limited to its cumulative net investment. As of March 31, 2022 and December 31, 2021, Alleghany’s carrying value in the Pillar Investments, as determined under the equity method of accounting, was $ 157.3 million a nd $ 156.4 million, respectively, which is reported as a component of other invested assets and is net of returns of capital received from the Pillar Investments. (i) Investments in Commercial Mortgage Loans As of March 31, 2022 and December 31, 2021, the carrying value of Alleghany’s commercial mortgage loan portfolio was $ 462.6 million a nd $ 475.9 million, respectively, representing the unpaid principal balance on the loans, less allowance for credit losses. The estimated fair value of the commercial mortgage loan portfolio approximated carrying value as of March 31, 2022 and December 31, 2021 . The commercial mortgage loan portfolio consists primarily of first mortgages on commercial properties in major metropolitan areas in the U.S. The loans earn interest at fixed- and floating-rates, and mature in two to ten years from loan origination. As of March 31, 2022, the vast majority of loans in Alleghany’s portfolio were originated in the 2016 through 2019 years. The principal amounts of the loans were no more than approximately two-thirds of the property’s appraised value at the time the loans were made and the estimated fair value of underlying collateral was approximately double that of the commercial mortgage loan portfolio carrying value as of March 31, 2022 . Fair value estimates of underlying collateral are updated on a rolling basis at least annually, with a portion of the portfolio updated each quarter. As of March 31, 2022 , there was no loan in default or in arrears. The following table presents a rollforward of Alleghany’s allowance for credit losses on commercial mortgage loans for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Allowance for Credit Losses Beginning balance $ 0.2 $ 1.4 Provision for credit losses 0.2 0.2 Charge-offs — — Recoveries — — Ending balance $ 0.4 $ 1.6 |
Reinsurance Ceded
Reinsurance Ceded | 3 Months Ended |
Mar. 31, 2022 | |
Insurance [Abstract] | |
Reinsurance Ceded | 4. Reinsurance Ceded (a) Overview Alleghany’s reinsurance and insurance subsidiaries reinsure portions of the risks they underwrite in order to reduce the effect of individual or aggregate exposure to losses, manage capacity, protect capital resources, reduce volatility in specific lines of business, improve risk-adjusted portfolio returns and enable them to increase gross premium writings and risk capacity without requiring additional capital. Alleghany’s reinsurance and insurance subsidiaries generally purchase reinsurance and retrocessional coverages from highly-rated third-party reinsurers or on a collateralized basis. If the assuming reinsurers are unable or unwilling to meet the obligations assumed under the applicable reinsurance agreements, Alleghany’s reinsurance and insurance subsidiaries would remain liable for such reinsurance portion not paid by these reinsurers. As such, funds, trust agreements and letters of credit are held to collateralize a portion of Alleghany’s reinsurance recoverables and Alleghany’s reinsurance and insurance subsidiaries reinsure portions of the risks they underwrite or assume with multiple reinsurance programs. A summary of the more significant programs follows. TransRe enters into various retrocession arrangements, including property catastrophe retrocession contracts, to manage the effects of individual or aggregate exposure to losses, reduce volatility in specific lines of business, improve risk-adjusted portfolio returns, strengthen its market position and enhance capital efficiency. These include excess-of-loss and quota share treaties in both traditional rated and collateralized form as well as catastrophe bonds. TransRe’s retrocession protections generally have a one-year term and renewal dates occur throughout the year, with the majority renewing at January 1. The catastrophe bonds, however, have a four-year term, with maturities in 2022 and 2023. RSUI reinsures its property lines of business through a program consisting of surplus share treaties, facultative placements, and per risk and catastrophe excess of loss treaties. RSUI’s catastrophe reinsurance program and property per risk reinsurance program each run on an annual basis from May 1 to the following April 30 and portions expired on April 30, 2022. Both programs were renewed on May 1, 2022 with substantially similar terms as the expired programs. RSUI reinsures certain portions of its casualty lines of business utilizing various quota share treaties and facultative placements. (b) Reinsurance Recoverables Amounts recoverable from reinsurers are recognized in a manner consistent with the loss and loss adjustment expense (“LAE”) liabilities associated with the reinsurance placement and presented on the balance sheet as reinsurance recoverables, and are recorded after an allowance for credit losses. Such balances as of March 31, 2022 and December 31, 2021 are presented in the table below: As of March 31, As of December 31, 2022 2021 ($ in millions) Reinsurance recoverables on paid losses $ 145.1 $ 173.1 Ceded outstanding loss and LAE 2,022.3 2,026.1 Reinsurance recoverables, before allowance for credit losses 2,167.4 2,199.2 Allowance for credit losses ( 2.7 ) ( 3.2 ) Total $ 2,164.7 $ 2,196.0 The following table presents information regarding concentration of Alleghany’s reinsurance recoverables and the ratings profile of Alleghany's reinsurers as of March 31, 2022: Reinsurer (1) Rating (2) Amount Percentage ($ in millions) PartnerRe Ltd A+ (Superior) $ 161.8 7.5 % Syndicates at Lloyd's of London A (Excellent) 156.8 7.2 % Kane SAC Ltd, Rondout Segregated Account (3) not rated 131.6 6.1 % Fairfax Financial Holdings Ltd A (Excellent) 128.9 5.9 % RenaissanceRe Holdings Ltd A+ (Superior) 128.1 5.9 % Swiss Reinsurance Company A+ (Superior) 99.2 4.6 % Integral Reinsurance Ltd. (3) not rated 86.7 4.0 % Chubb Ltd. A++ (Superior) 80.1 3.7 % W.R. Berkley Corporation A+ (Superior) 76.1 3.5 % SiriusPoint Ltd. (3) A- (Excellent) 70.9 3.3 % All other reinsurers 1,047.2 48.3 % Total reinsurance recoverables, before allowance for credit losses (4) $ 2,167.4 100.0 % Allowance for credit losses ( 2.7 ) Total $ 2,164.7 Secured reinsurance recoverables (3) $ 957.6 44.2 % (1) Reinsurance recoverables reflect amounts due from one or more reinsurance subsidiaries of the listed company. (2) Represents the A.M. Best Company, Inc. financial strength rating for the applicable reinsurance subsidiary or subsidiaries from which the reinsurance recoverable is due. (3) Represents reinsurance recoverables secured by funds held, trust agreements or letters of credit. (4) Approxim ately 66 percent of Alleghany's reinsurance recoverables balance as of March 31, 2022 was due from reinsurers having an A.M. Best Company, Inc. financial strength rating of A (Excellent) or higher, with a majority of the other reinsurance recoverables being secured by funds held, trust agreements or letters of credit. The following table presents a rollforward of Alleghany’s allowance for credit losses on reinsurance recoverables for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Allowance for Credit Losses Beginning balance $ 3.2 $ 7.9 Provision for credit losses ( 0.5 ) ( 1.9 ) Charge-offs — — Recoveries — — Ending balance $ 2.7 $ 6.0 |
Liability for Loss and LAE
Liability for Loss and LAE | 3 Months Ended |
Mar. 31, 2022 | |
Insurance [Abstract] | |
Liability for Loss and LAE | 5. Liability for Loss and LAE (a) Liability Rollforward The following table presents the activity in the liability for loss and LAE for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Reserves as of January 1 $ 14,357.6 $ 12,970.6 Less: reinsurance recoverables (1) 2,026.1 1,703.7 Net reserves as of January 1 12,331.5 11,266.9 Other adjustments ( 0.1 ) — Incurred loss and LAE, net of reinsurance, related to: Current year 995.1 1,168.2 Prior years ( 53.3 ) ( 56.1 ) Total incurred loss and LAE, net of reinsurance 941.8 1,112.1 Paid loss and LAE, net of reinsurance, related to: (2) Current year 68.2 87.4 Prior years 902.1 766.8 Total paid loss and LAE, net of reinsurance 970.3 854.2 Foreign currency exchange rate effect ( 8.8 ) 29.5 Net reserves as of March 31 12,294.1 11,554.3 Reinsurance recoverables as of March 31 (1) 2,022.3 1,738.7 Reserves as of March 31 $ 14,316.4 $ 13,293.0 (1) Reinsurance recoverables in this table include only ceded loss and LAE reserves. (2) Includes paid losses and LAE, net of reinsurance, related to commutations. Gross loss and LAE reserves as of March 31, 2022 approximated gross loss and LAE reserves as of December 31, 2021, primarily reflecting catastrophe losses incurred in first three months of 2022, offset by payments on catastrophe losses incurred in prior years and net favorable prior accident year loss reserve development. (b) Liability Development The following table presents the (favorable) unfavorable prior accident year loss reserve development, including from the Pandemic (defined in Note 9(a)), for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Reinsurance Segment Property: Catastrophe events (excluding Pandemic) $ ( 2.4 ) (1) $ ( 4.5 ) (2) Pandemic ( 4.3 ) 29.8 Non-catastrophe ( 12.4 ) (3) ( 11.5 ) (4) Total ( 19.1 ) 13.8 Casualty & specialty: Catastrophe events (excluding Pandemic) ( 1.7 ) ( 1.3 ) Pandemic 0.9 ( 11.8 ) Non-catastrophe ( 30.0 ) (5) ( 54.2 ) (6) Total ( 30.8 ) ( 67.3 ) Total Reinsurance Segment ( 49.9 ) ( 53.5 ) Insurance Segment RSUI: Casualty ( 1.8 ) (7) ( 1.1 ) (8) Property and other ( 4.5 ) (9) ( 1.6 ) (10) Total ( 6.3 ) ( 2.7 ) CapSpecialty 2.9 (11) 0.1 (12) Total incurred related to prior years $ ( 53.3 ) $ ( 56.1 ) (1) Primarily reflects favorable prior accident year loss reserve development related to several catastrophic events in the 2018 and 2019 accident years. (2) Primarily reflects favorable prior accident year loss reserve development related to Hurricane Michael in the 2018 accident year, partially offset by unfavorable prior accident year loss reserve development related to Hurricane Laura in the 2020 accident year. (3) Primarily reflects favorable prior accident year loss reserve development in the 2018 through 2020 accident years. (4) Primarily reflects favorable prior accident year loss reserve development in the 2020 accident year. (5) Primarily reflects favorable prior accident year loss reserve development in the longer-tailed lines of business in the 2008 and prior accident years and shorter-tailed lines of business in the 2019 through 2021 accident years, partially offset by unfavorable prior accident year development in the longer-tailed lines of business in the 2009 through 2018 accident years. (6) Primarily reflects favorable prior accident year loss reserve development in the longer-tailed lines of business in the 2016 and earlier accident years and (7) Primarily reflects favorable prior accident year loss reserve development in in the directors' and officers' liability lines of business in the 2018 and earlier accident years and the umbrella/excess lines of business in the 2015 and earlier accident years. (8) Primarily reflects favorable prior accident year loss reserve development in the umbrella/excess lines of business in the 2007 through 2014 accident years, partially offset by unfavorable prior accident year loss reserve development in the directors' and officers' liability lines of business in the 2013 accident year. (9) Primarily reflects favorable prior accident year loss reserve development related to catastrophe losses in the 2021 accident year and, to a lesser extent, the 2020 accident year. (10) Primarily reflects favorable prior accident year loss reserve development related to catastrophes in the 2017 and 2018 accident years, partially offset by unfavorable prior accident year loss reserve development related to catastrophes in the 2020 accident year. (11) Primarily reflects unfavorable prior accident year loss reserve development in several casualty liability lines of business in the 2014 through 2018 accident years. (12) Primarily reflects unfavorable prior accident year loss reserve development in several casualty lines of business. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 6. Income Taxes The effective tax rate on earnings before income taxes for the first three months of 2022 was 21.1 percent compared with 19.8 percent for the first three months of 2021. The higher effective tax rate in the first quarter of 2022 primarily reflects higher compensation-related permanent tax expenses. Alleghany believes that, as of March 31, 2022 , it had no material uncertain tax positions. Interest and penalties related to unrecognized tax expenses (benefits) are recognized in income tax expense, when applicable. There were no material liabilities for interest or penalties accrued as of March 31, 2022 . |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | 7. Stockholders’ Equity (a) Common Stock Repurchases In September 2019, the Alleghany Board of Directors authorized, upon the completion of a previously announced program, the repurchase of shares of Common Stock, at such times and at prices as management determines to be advisable, up to an aggregate of $ 500.0 million. Upon the public announcement of the Merger Agreement, repurchases of shares of Common Stock ceased. As of March 31, 2022, Alleghany had $ 45.9 million remaining under its share repurchase authorizations. The following table presents the shares of Common Stock that Alleghany repurchased in the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 Shares repurchased 144,864 103,025 Cost of shares repurchased (in millions) $ 96.0 $ 63.2 Average price per share repurchased $ 662.60 $ 613.36 (b) Accumulated Other Comprehensive Income (Loss) The following tables present a reconciliation of the changes during the three months ended March 31, 2022 and 2021 in accumulated other comprehensive income (loss) attributable to Alleghany stockholders: Unrealized Unrealized Retirement Total ($ in millions) Balance as of January 1, 2022 $ 259.1 $ ( 103.7 ) $ ( 13.6 ) $ 141.8 Other comprehensive (loss) income, net of tax: Other comprehensive (loss) income before reclassifications ( 614.3 ) ( 0.5 ) 0.1 ( 614.7 ) Reclassifications from accumulated other comprehensive income 8.4 — — 8.4 Total ( 605.9 ) ( 0.5 ) 0.1 ( 606.3 ) Balance as of March 31, 2022 $ ( 346.8 ) $ ( 104.2 ) $ ( 13.5 ) $ ( 464.5 ) Unrealized Unrealized Retirement Total ($ in millions) Balance as of January 1, 2021 $ 564.9 $ ( 99.4 ) $ ( 13.1 ) $ 452.4 Other comprehensive income (loss), net of tax: Other comprehensive (loss) income before reclassifications ( 217.9 ) 2.5 ( 1.0 ) ( 216.4 ) Reclassifications from accumulated other comprehensive income ( 11.8 ) — — ( 11.8 ) Total ( 229.7 ) 2.5 ( 1.0 ) ( 228.2 ) Balance as of March 31, 2021 $ 335.2 $ ( 96.9 ) $ ( 14.1 ) $ 224.2 The following table presents unrealized appreciation of investment reclassifications out of accumulated other comprehensive income or loss attributable to Alleghany stockholders during the three months ended March 31, 2022 and 2021: Accumulated Other Three Months Ended Comprehensive Income Component Line in Consolidated Statement of Earnings 2022 2021 ($ in millions) Unrealized appreciation of investments: Net realized capital gains $ 10.0 $ ( 12.9 ) Change in allowance for credit losses on 0.6 ( 2.0 ) Income taxes ( 2.2 ) 3.1 Total reclassifications: Net losses (earnings) $ 8.4 $ ( 11.8 ) |
Earnings Per Share of Common St
Earnings Per Share of Common Stock | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share of Common Stock | 8. Earnings Per Share of Common Stock The following table presents a reconciliation of the earnings and share data used in the basic and diluted earnings per share computations for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions, except share amounts) Net earnings available to Alleghany stockholders $ 125.7 $ 230.0 Effect of dilutive securities — ( 0.8 ) Income available to common stockholders for diluted earnings per share $ 125.7 $ 229.2 Weighted average common shares outstanding applicable to basic earnings per share 13,522,787 13,989,410 Effect of dilutive securities — 9,576 Adjusted weighted average common shares outstanding applicable to diluted earnings per share 13,522,787 13,998,986 Contingently issuable shares (1) — 40,789 (1) Contingently issuable shares were potentially available in the periods presented, but were not included in the diluted earnings per share computations because the impact was anti-dilutive to the earnings per share calculation. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies (a) The Pandemic The COVID-19 global pandemic (the “Pandemic”) has significantly disrupted many aspects of society, as well as financial markets, and has caused widespread global economic dislocation. Although widespread vaccine rollouts have occurred in the U.S. in early 2021 and are continuing, new variants of the virus have emerged. Alleghany cannot reasonably estimate the duration or severity of the Pandemic, or the extent to which the related disruption may adversely impact its results of operations, financial position and cash flows, or those of its subsidiaries. Adverse impacts from the Pandemic in future periods may include realized and unrealized losses in Alleghany’s investment portfolio and receivables, increased underwriting losses at its reinsurance and insurance segments, and impairment losses on certain subsidiary goodwill and intangible assets. (b) Legal Proceedings Certain of Alleghany’s subsidiaries are parties to pending litigation and claims in connection with the ordinary course of their businesses. Each such subsidiary makes provisions for estimated losses to be incurred in such litigation and claims, including legal costs. In the opinion of management, such provisions are adequate, and management does not believe that any pending litigation will have a material adverse effect on Alleghany’s consolidated results of operations, financial position or cash flows. (c) Leases Alleghany and its subsidiaries lease certain facilities, land, furniture and equipment under long-term, non-cancelable lease agreements that expire at various dates in future years. Most of Alleghany’s leases relate to office facilities. Alleghany’s lease agreements do not contain any material restrictive covenants and substantially all are considered to be operating leases. Additional information about leases can be found in Note 12(b) to Notes to Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of the 2021 Form 10-K. (d) Hotel Development Commitments Commencing in 2020, Alleghany Capital invest ed in certain hotel development projects. As of March 31, 2022, Alleghany Capital has invested $ 5.3 million in certain hotel development projects. The projects are conducted through certain limited liability entities, which are variable interest entities, to which Alleghany is not the primary beneficiary. As of March 31, 2022 Alleghany guaranteed up to $ 5.3 million of debt of these entities to certain third-party lenders, for which Alleghany receives a fee. |
Segments of Business
Segments of Business | 3 Months Ended |
Mar. 31, 2022 | |
Segment Reporting [Abstract] | |
Segments of Business | 10. Segments of Business (a) Overview Alleghany’s segments are reported in a manner consistent with the way management evaluates the businesses. As such, Alleghany classifies its businesses into three reportable segments – reinsurance, insurance and Alleghany Capital. Reinsurance and insurance underwriting activities are evaluated separately from investment and other activities. Segment accounting policies are described in Note 1 to Notes to Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of the 2021 Form 10-K. The reinsurance segment consists of property and casualty reinsurance operations conducted by TransRe’s reinsurance operating subsidiaries and is further reported through two major product lines – property, and casualty & specialty. TransRe provides property and casualty reinsurance to insurers and other reinsurers through brokers and on a direct basis to ceding companies. TransRe writes a modest amount of property and casualty insurance business, which is included in the reinsurance segment. Aside from the U.S., a significant portion of the premiums earned by TransRe’s operations are generated by offices located in Canada, Europe, Asia, Australia, Africa and those serving Latin America and the Caribbean. Although the majority of the premiums earned by these offices typically relate to the regions where they are located, a significant portion may be derived from other regions of the world, including the U.S. In addition, although a significant portion of the assets and liabilities of these foreign offices generally relate to the countries where the ceding companies and reinsurers are located, most investments are located in the country of domicile of these offices. The insurance segment consists of property and casualty insurance operations conducted in the U.S. by AIHL through its insurance operating subsidiaries RSUI and CapSpecialty. RSUI also writes a modest amount of assumed reinsurance business, which is included in the insurance segment. The Alleghany Capital segment consists of industrial operations, consumer & services operations and corporate operations at the Alleghany Capital level, which include certain hotel development projects. Industrial operations are conducted through PCT, Kentucky Trailer, W&W|AFCO Steel, Wilbert and, beginning May 10, 2021, Piedmont. Consumer & services operations are conducted through IPS, Jazwares and Concord. On October 14, 2021, IPS acquired the outstanding equity of Anchorbuoy Limited (with its subsidiaries, referred to as 262.5 million U.S. dollar-equivalent, consisting of: (i) $ 98.6 million of cash from IPS (which includes a $ 97.4 million contribution from Alleghany); (ii) the issuance of certain noncontrolling interests in IPS, which were valued at $ 38.8 million and which increased the aggregate noncontrolling interests in IPS from approximately 15 percent to approximately 18 percent; and (iii) $ 125.1 million of U.S. dollar-equivalent incremental debt, which is denominated in Euro. In connection with the acquisition, Alleghany recorded $ 102.1 million of goodwill, $ 124.7 million of finite-lived intangible assets related to customer relationships and $ 15.5 million of indefinite-lived intangible assets related to trade names and trademarks. The acquisition-date consideration transferred and purchase price allocation to the acquired assets and liabilities of Linesight were based on estimated fair values that have not been finalized. As a result, the fair value recorded for these items is a provisional estimate and may be subject to adjustment. Once completed, any adjustment resulting from the valuations may impact the individual amounts recorded for assets acquired and liabilities assumed, as well as the residual goodwill. The acquisition accounting for Linesight is expected to be finalized later in 2022. Corporate activities are not classified as a segment. The primary components of corporate activities are Alleghany Properties and activities at the Alleghany parent company. Corporate activities also include the elimination of minor activity between segments. In addition, corporate activities include interest expense associated with the senior notes issued by Alleghany, whereas interest expense associated with senior notes issued by TransRe is included in “Total Segments” and interest expense associated with other debt is included in Alleghany Capital. Information related to the senior notes and other debt can be found in Note 8 to Notes to Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of the 2021 Form 10-K. (b) Results The following tables present segment results for Alleghany’s three reportable segments and for corporate activities for the three months ended March 31, 2022 and 2021: Reinsurance Segment Insurance Segment Three Months Ended Property Casualty & (1) Total RSUI Cap Total Subtotal Alleghany Total Corporate Activities Consolidated ($ in millions) Gross premiums written $ 454.4 $ 1,074.0 $ 1,528.4 $ 517.4 $ 112.2 $ 629.6 $ 2,158.0 $ — $ 2,158.0 $ ( 11.0 ) $ 2,147.0 Net premiums written 346.6 1,011.4 1,358.0 342.1 92.7 434.8 1,792.8 — 1,792.8 — 1,792.8 Net premiums earned 291.5 871.4 1,162.9 346.4 96.2 442.6 1,605.5 — 1,605.5 — 1,605.5 Net loss and LAE 162.1 560.9 723.0 159.4 59.4 218.8 941.8 — 941.8 — 941.8 Commissions, brokerage and 86.7 281.6 368.3 72.2 36.7 108.9 477.2 — 477.2 — 477.2 Underwriting profit (2) $ 42.7 $ 28.9 $ 71.6 $ 114.8 $ 0.1 $ 114.9 186.5 — 186.5 — 186.5 Net investment income 108.5 — 108.5 5.0 113.5 Change in the fair value of equity securities ( 154.1 ) — ( 154.1 ) 15.2 (138.9 ) Net realized capital gains ( 16.1 ) 6.1 ( 10.0 ) — ( 10.0 ) Change in allowance for credit losses on available for sale securities ( 0.6 ) — ( 0.6 ) — ( 0.6 ) Product and service revenues 8.0 1,121.4 1,129.4 19.8 1,149.2 Other operating expenses 13.6 1,013.3 1,026.9 1.9 1,028.8 Corporate administration — — — 10.7 10.7 Amortization of intangible assets 0.4 13.7 14.1 — 14.1 Interest expense 6.7 5.7 12.4 19.7 32.1 Earnings before income taxes $ 111.5 $ 94.8 $ 206.3 $ 7.7 $ 214.0 Reinsurance Segment Insurance Segment Three Months Ended Property Casualty & (1) Total RSUI Cap Total Subtotal Alleghany Total Corporate Activities Consolidated ($ in millions) Gross premiums written $ 565.3 $ 972.9 $ 1,538.2 $ 420.9 $ 102.2 $ 523.1 $ 2,061.3 $ — $ 2,061.3 $ ( 10.9 ) $ 2,050.4 Net premiums written 459.0 935.9 1,394.9 272.5 87.4 359.9 1,754.8 — 1,754.8 — 1,754.8 Net premiums earned 371.3 858.6 1,229.9 283.6 91.3 374.9 1,604.8 — 1,604.8 — 1,604.8 Net loss and LAE 323.5 525.4 848.9 208.2 55.0 263.2 1,112.1 — 1,112.1 — 1,112.1 Commissions, brokerage and 109.2 266.8 376.0 64.1 35.9 100.0 476.0 — 476.0 — 476.0 Underwriting (loss) profit (2) $ ( 61.4 ) $ 66.4 $ 5.0 $ 11.3 $ 0.4 $ 11.7 16.7 — 16.7 — 16.7 Net investment income 123.1 — 123.1 30.4 153.5 Change in the fair value of equity securities 85.3 — 85.3 27.4 112.7 Net realized capital gains 10.5 0.9 11.4 1.5 12.9 Change in allowance for credit losses on available for sale securities 1.9 — 1.9 0.1 2.0 Product and service revenues 8.6 759.1 767.7 0.1 767.8 Other operating expenses 14.4 709.2 723.6 0.3 723.9 Corporate administration ( 0.5 ) — ( 0.5 ) 10.1 9.6 Amortization of intangible assets 0.2 11.3 11.5 — 11.5 Interest expense 6.8 3.8 10.6 13.1 23.7 Earnings before income taxes $ 225.2 $ 35.7 $ 260.9 $ 36.0 $ 296.9 (1) Primarily consists of the following reinsurance lines of business: directors’ and officers’ liability; errors and omissions liability; general liability; medical malpractice; ocean marine and aviation; auto liability; accident and health; mortgage reinsurance; surety; and credit. (2) Underwriting profit represents net premiums earned less net loss and LAE and commissions, brokerage and other underwriting expenses, all as determined in accordance with GAAP, and does not include net investment income, change in the fair value of equity securities, net realized capital gains, change in allowance for credit losses on available for sale securities, product and service revenues, other operating expenses, corporate administration, amortization of intangible assets or interest expense. Underwriting profit does not replace earnings before income taxes determined in accordance with GAAP as a measure of profitability. Rather, Alleghany believes that underwriting profit enhances the understanding of its reinsurance and insurance segments’ operating results by highlighting net earnings attributable to their underwriting performance. Earnings before income taxes (a GAAP measure) may show a profit despite an underlying underwriting loss. Where underwriting losses persist over extended periods, a reinsurance or an insurance company’s ability to continue as an ongoing concern may be at risk. Therefore, Alleghany views underwriting profit as an important measure in the overall evaluation of performance. (c) Identifiable Assets and Equity The following table presents identifiable assets, the portion of identifiable assets related to cash and invested assets and equity attributable to Alleghany for Alleghany’s reportable segments and for corporate activities as of March 31, 2022: Identifiable Invested Assets Equity ($ in millions) Reinsurance segment $ 18,771.4 $ 14,734.9 $ 4,892.4 Insurance segment 8,320.4 5,967.3 2,677.8 Subtotal 27,091.8 20,702.2 7,570.2 Alleghany Capital 3,419.2 169.6 1,357.6 Total segments 30,511.0 20,871.8 8,927.8 Corporate activities 1,383.4 1,423.0 ( 332.4 ) Consolidated $ 31,894.4 $ 22,294.8 $ 8,595.4 The debt associated with Alleghany Capital’s operating subsidiaries totaled $ 756.0 million and $ 780.5 million as of March 31, 2022 and December 31, 2021, respectively, and is generally used to support working capital needs and to help finance acquisitions. As of March 31, 2022, the $ 756.0 million includes: • $ 267.9 million of borrowings by Jazwares under its available credit facilities to support its seasonal peak working capital requirements and borrowings incurred and assumed from its recent acquisitions; • $ 172.1 million of borrowings by IPS under its available credit facility and term loans, including U.S. dollar-equivalent Euro-based borrowings incurred from its acquisition of Linesight in 2021; • $ 125.4 million of borrowings by W&W|AFCO Steel under its available credit facilities; • $ 74.7 million of borrowings by Wilbert under its available credit facility and term loans; • $ 60.4 million of term loans at Kentucky Trailer primarily related to borrowings to finance small acquisitions, including its recent acquisitions and borrowings under its available credit facilities; • $ 31.4 million at Piedmont primarily related to borrowings to finance the acquisition of WPS in May 2021; and • $ 24.1 million of term loans at PCT primarily related to borrowings to finance recent acquisitions. None of the above liabilities are guaranteed by Alleghany or Alleghany Capital. In December 2019, third-party, floating-rate term loans at Concord were repaid and replaced with approximately $ 33 million of intercompany floating-rate debt funded by the Alleghany parent company. The intercompany debt and related interest expenses are eliminated at the Alleghany consolidated level. (d) Alleghany Capital Product and Service Revenues For Alleghany Capital’s industrial and consumer & services operations, product and service revenues consist of the sale of manufactured goods and services. The following table presents product and service revenues for the Alleghany Capital segment for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Industrial (1) $ 461.6 $ 404.4 Consumer & services (2) 659.8 354.7 Corporate & other — — Alleghany Capital $ 1,121.4 $ 759.1 (1) For the three months ended March 31, 2022 and 2021, the vast majority of industrial product and service revenues were recognized as goods and services transferred to customers over time. (2) For the three months ended March 31, 2022 and 2021, approximat ely 59 percent a nd 63 percent, respectively, of consumer & services product and service revenues were recognized as services transferred to customers over time, with the remainder recognized as goods transferred at a point in time. |
Summary of Significant Accoun_2
Summary of Significant Accounting Principles (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Principles of Financial Statement Presentation | (a) Principles of Financial Statement Presentation This Quarterly Report on Form 10-Q (this “Form 10-Q”) should be read in conjunction with the Annual Report on Form 10-K for the year ended December 31, 2021 (the “2021 Form 10-K”) of Alleghany Corporation (“Alleghany”). Alleghany, a Delaware corporation, owns and supports certain operating subsidiaries and manages investments, anchored by a core position in property and casualty reinsurance and insurance. Through its wholly-owned subsidiary Transatlantic Holdings, Inc. (“TransRe”), an Alleghany subsidiary since March 2012, Alleghany is engaged in the property and casualty reinsurance business. Through its wholly-owned subsidiary Alleghany Insurance Holdings LLC (“AIHL”), Alleghany is engaged in the property and casualty insurance business. AIHL’s insurance operations are principally conducted by its subsidiaries RSUI Group, Inc. (“RSUI”) and CapSpecialty, Inc. (“CapSpecialty”). RSUI and CapSpecialty have been subsidiaries of AIHL since July 2003 and January 2002, respectively. AIHL Re LLC (“AIHL Re”), a captive reinsurance company, which provides reinsurance to Alleghany’s current and former insurance operating subsidiaries and affiliates, has been a subsidiary of Alleghany since its formation in May 2006. Although Alleghany’s primary sources of revenues and earnings are its reinsurance and insurance operations and investments, Alleghany also generates revenues and expenses from a diverse portfolio of non-financial businesses that are owned and supported through its wholly-owned subsidiary Alleghany Capital Corporation (“Alleghany Capital”). Alleghany Capital’s businesses include: • Precision Cutting Technologies, Inc. (“PCT”), a holding company headquartered in Rockford, Illinois, with four operating businesses: (i) Bourn & Koch, Inc., a provider of precision automated machine tool solutions; (ii) Diamond Technology Innovations, Inc., a manufacturer of waterjet orifices and nozzles and a provider of related services; (iii) Coastal Industrial Distributors, LLC, a provider of high-performance solid carbide end mills; and (iv) Supermill LLC, a manufacturer of high-performance solid carbide end mills; • R.C. Tway Company, LLC (“Kentucky Trailer”), a manufacturer of custom trailers and truck bodies for the moving and storage industry and other markets, headquartered in Louisville, Kentucky; • IPS-Integrated Project Services, LLC (“IPS”), a global provider of design, engineering and related services to the biopharmaceutical and life sciences markets, and cost and project management services for clients in the data center, technology and other sectors, headquartered in Blue Bell, Pennsylvania; • Jazwares, LLC (together with its affiliates, “Jazwares”), a global toy company, headquartered in Sunrise, Florida; • WWSC Holdings, LLC (“W&W|AFCO Steel”), a structural steel fabricator and erector, headquartered in Oklahoma City, Oklahoma; • CHECO Holdings, LLC (“Concord”), a hotel management and development company, headquartered in Raleigh, North Carolina; • Wilbert Funeral Services, Inc. (“Wilbert”), a provider of products and services for the funeral and cemetery industries and precast concrete markets, headquartered in Overland Park, Kansas; and • Piedmont Manufacturing Group, LLC (“Piedmont”), a provider of injection molded and thermoformed parts and multi-component assemblies for original equipment manufacturer customers in a range of end-markets, headquartered in Belmont, North Carolina. The results of Piedmont have been included in Alleghany’s consolidated results from its formation and subsequent acquisition of Wilbert, Inc., doing business as Wilbert Plastic Services (“WPS”) on May 10, 2021. In addition, Alleghany owns certain other holding-company investments. Alleghany’s wholly-owned subsidiary Alleghany Properties Holdings LLC (“Alleghany Properties”) owns and manages certain properties in the Sacramento, California region. Alleghany’s public equity investments are managed primarily through Alleghany’s wholly-owned subsidiary Roundwood Asset Management LLC. On March 20, 2022, Alleghany entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Berkshire Hathaway Inc., a Delaware corporation (“Berkshire”) and O&M Acquisition Corp., a Delaware corporation and a wholly-owned subsidiary of Berkshire (“Merger Sub”). Pursuant to the Merger Agreement and subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub will be merged with and into Alleghany, with Alleghany continuing as the surviving corporation and a wholly-owned subsidiary of Berkshire (“Merger”). As a result of the Merger, each issued and outstanding share of Alleghany's common stock, par value $ 1.00 per share (the “Common Stock”) (other than shares (a) held in the treasury of Alleghany or owned by Berkshire or any direct or indirect wholly-owned subsidiary of Berkshire or (b) held by a stockholder who has demanded and perfected such holder's demand for appraisal rights in accordance with Delaware law) will be cancelled and extinguished and converted into the right to receive $ 848.02 in cash, without interest, representing a total equity value of approximately $ 11.6 billion. The closing of the Merger is subject to certain conditions, including (i) the approval and adoption of the Merger Agreement by the holders of at least 75 % of the voting power of the outstanding shares of Common Stock, (ii) the expiration or termination of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and applicable foreign antitrust laws, (iii) the receipt of authorizations required to be obtained from applicable insurance regulators and (iv) other customary closing conditions. The Merger Agreement generally requires Alleghany to operate its business in the ordinary course pending consummation of the proposed Merger and restricts Alleghany, without Berkshire’s consent, from taking certain specified actions until the Merger is completed. For a description of the treatment of equity awards under the Merger Agreement, see Alleghany’s definitive proxy statement filed with the SEC on April 29, 2022. Unless the context otherwise requires, references to “Alleghany” include Alleghany together with its subsidiaries. The accompanying consolidated financial statements include the results of Alleghany and its wholly-owned and majority-owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”). All material inter-company balances and transactions have been eliminated in consolidation. The portion of stockholders’ equity, net earnings and comprehensive income that is not attributable to Alleghany stockholders is presented on the consolidated balance sheets, the consolidated statements of earnings and comprehensive income and the consolidated statements of changes in stockholders’ equity as noncontrolling interests. Because all noncontrolling interests have the option to sell their ownership interests to Alleghany in the future (generally through 2028), the portion of stockholders’ equity that is not attributable to Alleghany stockholders is presented on the consolidated balance sheets and the consolidated statements of changes in stockholders’ equity as redeemable noncontrolling interests for all periods presented. In addition, Alleghany accretes the redeemable noncontrolling interests up to their future estimated redemption value over the period from the date of issuance to the earliest redemption date. The redemption value of the equity interests is generally based on the subsidiary’s earnings in specified periods preceding the applicable redemption date, calculated based on either a specified formula or an independent fair market valuation. Accretion related to redemption values based on a specified formula are recorded as a component of net earnings attributable to noncontrolling interests, whereas accretion related to redemption values based on an independent fair market valuation are recorded as a component of contributed capital. Accretion may increase or decrease each period, however, the redeemable noncontrolling interest balance may not go below the initial balance established at the acquisition date. The following table presents the components of net earnings attributable to noncontrolling interests for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Accretion of redeemable noncontrolling interests $ 18.8 $ 0.6 Portion of net earnings attributable to noncontrolling interests 24.4 7.5 Total $ 43.2 $ 8.1 In addition, accretion reduced contributed capital by $ 16.5 million and $ 0.0 million fo r the three months ended March 31, 2022 and 2021, respectively. Such accretion may be adjusted later in 2022 as certain significant noncontrolling interest holders have the right to put their respective equity interests to Alleghany Capital. The difference between any actual payouts that may be negotiated and agreed, as compared to the carrying value of such noncontrolling interests, will be recorded as accretion and charged to contributed capital. As of March 31, 2022, the noncontrolling interests outstanding were approximately as follows: Kentucky Trailer - 22 percent; IPS - 18 percent; Jazwares - 24 percent; W&W|AFCO Steel - 20 percent; and Concord - 15 percent. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Alleghany relies on historical experience and on various other assumptions that it believes to be reasonable under the circumstances to make judgments about the carrying value of assets and liabilities and reported revenues and expenses that are not readily apparent from other sources. Actual results may differ materially from those reported results to the extent that those estimates and assumptions prove to be inaccurate. Changes in estimates are reflected in the consolidated statements of earnings and comprehensive income in the period in which the changes are made. |
Recent Accounting Standards | (c) Recent Accounting Standards Recently Adopted In August 2020, the Financial Accounting Standards Board (the “FASB”) issued guidance that simplifies the accounting and disclosure requirements for certain financial instruments with characteristics of liabilities and equity, such as convertible debt and convertible preferred stock. This guidance also modifies the accounting for certain contracts involving an entity’s own stock. This guidance was effective in the first quarter of 2022 for public companies, with early adoption permitted. Alleghany adopted this guidance in the first quarter of 2022 and the adoption did not have a material impact on its results of operations and financial condition. In May 2021, the FASB issued guidance on how issuers should account for modifications or exchanges of freestanding equity-classified written call options that remain classified as equity after the modification or exchange. Under this guidance, the issuer will determine the accounting for the modification or exchange based on the economic substance of the modification or exchange (i.e. to issue equity, to issue or modify debt, or other reasons). This guidance was effective in the first quarter of 2022 for all entities, with early adoption permitted when applied as of the beginning of the fiscal year. Alleghany adopted this guidance in the first quarter of 2022 and the adoption did not have a material impact on its results of operations and financial condition. Future Application of Accounting Standards In October 2021, the FASB issued guidance related to contract assets and liabilities recorded in a business combination. A contract asset is recorded when the amount of goods or services transferred to a customer exceed the amount received or receivable from the customer, and a contract liability is recorded when the amount received or receivable from a customer exceeds the amount of goods or services transferred to the customer. The guidance requires that the acquirer of a business determine and record a customer contract asset or liability it would have recorded if the acquirer had entered into the original contract with the customer at the same date and at the same terms as the acquiree using preexisting revenue recognition guidance. Under current guidance, contract assets and liabilities are recorded at acquisition date fair value. As a result of this guidance, the acquisition date recognition and measurement of customer contract assets and liabilities will likely be similar to the acquiree carrying values, and post-acquisition revenue recognition will likely be similar to what the acquiree would have recorded. This guidance is effective for public companies for business acquisitions completed on or after January 1, 2023, with early adoption permitted subject to certain conditions and requirements. Alleghany will adopt this guidance for business acquisitions completed on or after January 1, 2023 and does not currently believe that the implementation will have a material impact on its results of operations and financial condition. In March 2022, the FASB issued guidance on credit losses. Under this guidance, all loan and receivable modifications, including modifications made for borrowers experiencing financial difficulty, shall be accounted for using the current expected credit loss model (the “Model”). This guidance applies to entities that have previously adopted the Model. Entities that have not yet adopted the Model will continue to use pre-existing accounting rules. This guidance also expands disclosure requirements for modifications made for borrowers experiencing financial difficulty. This guidance is effective in the first quarter of 2023 for public companies, with early adoption permitted. Alleghany previously adopted the Model in the first quarter of 2020 and will adopt this guidance in the first quarter of 2023. Alleghany does not currently believe that the implementation will have a material impact on its results of operations and financial condition. |
Summary of Significant Accoun_3
Summary of Significant Accounting Principles (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Noncontrolling Interest [Abstract] | |
Components of Net Earnings Attributable to Noncontrolling Interests | The following table presents the components of net earnings attributable to noncontrolling interests for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Accretion of redeemable noncontrolling interests $ 18.8 $ 0.6 Portion of net earnings attributable to noncontrolling interests 24.4 7.5 Total $ 43.2 $ 8.1 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Carrying Value and Estimated Fair Value of Consolidated Financial Instruments | The following table presents the carrying value and estimated fair value of Alleghany’s consolidated financial instruments as of March 31, 2022 and December 31, 2021: March 31, 2022 December 31, 2021 Carrying Value Fair Value Carrying Value Fair Value ($ in millions) Assets Investments (excluding equity method investments and loans) (1) $ 20,277.9 $ 20,277.9 $ 20,887.7 $ 20,887.7 Liabilities Senior notes and other debt (2) $ 2,822.8 $ 2,950.2 $ 2,847.2 $ 3,157.9 (1) This table includes debt and equity securities, as well as partnership and non-marketable equity investments accounted for at fair value that are included in other invested assets. This table excludes investments accounted for using the equity method and commercial mortgage loans that are accounted for at unpaid principal balance. The fair value of short-term investments approximates amortized cost. (2) See Note 8 to Notes to Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of the 2021 Form 10-K for additional information on the senior notes and other debt. |
Financial Instruments at Fair Value and Level of Fair Value Hierarchy of Inputs | The following tables present Alleghany’s financial instruments at fair value and the level of the fair value hierarchy of inputs used as of March 31, 2022 and December 31, 2021: Level 1 Level 2 Level 3 Total ($ in millions) As of March 31, 2022 Equity securities: Common stock $ 3,406.5 $ 2.4 $ — $ 3,408.9 Preferred stock — 3.3 1.3 4.6 Total equity securities 3,406.5 5.7 1.3 3,413.5 Debt securities: U.S. Government obligations — 1,593.0 — 1,593.0 Municipal bonds — 2,641.9 — 2,641.9 Foreign government obligations — 818.0 — 818.0 U.S. corporate bonds — 2,676.8 674.0 3,350.8 Foreign corporate bonds — 997.0 189.4 1,186.4 Mortgage and asset-backed securities: Residential mortgage-backed securities (“RMBS”) (1) — 1,830.1 1.8 1,831.9 Commercial mortgage-backed securities (“CMBS”) — 1,044.4 4.3 1,048.7 Other asset-backed securities (2) — 1,759.1 1,328.8 3,087.9 Total debt securities — 13,360.3 2,198.3 15,558.6 Short-term investments — 1,305.8 — 1,305.8 Total investments (excluding equity method investments and loans) $ 3,406.5 $ 14,671.8 $ 2,199.6 $ 20,277.9 Senior notes and other debt $ — $ 2,194.2 $ 756.0 $ 2,950.2 Level 1 Level 2 Level 3 Total ($ in millions) As of December 31, 2021 Equity securities: Common stock $ 3,677.1 $ 2.1 $ — $ 3,679.2 Preferred stock — 3.3 1.3 4.6 Total equity securities 3,677.1 5.4 1.3 3,683.8 Debt securities: U.S. Government obligations — 2,050.7 — 2,050.7 Municipal bonds — 2,535.9 — 2,535.9 Foreign government obligations — 854.9 — 854.9 U.S. corporate bonds — 2,807.0 670.3 3,477.3 Foreign corporate bonds — 1,049.7 177.2 1,226.9 Mortgage and asset-backed securities: RMBS (1) — 2,007.1 1.9 2,009.0 CMBS — 905.9 — 905.9 Other asset-backed securities (2) — 1,652.7 1,348.3 3,001.0 Total debt securities — 13,863.9 2,197.7 16,061.6 Short-term investments — 1,142.3 — 1,142.3 Total investments (excluding equity method investments and loans) $ 3,677.1 $ 15,011.6 $ 2,199.0 $ 20,887.7 Senior notes and other debt $ — $ 2,377.4 $ 780.5 $ 3,157.9 (1) Primarily includes government agency pass-through securities guaranteed by a government agency or government sponsored enterprise, among other types of RMBS. (2) Include s $ 1,281.5 million an d $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. |
Reconciliations of Changes in Level Three Assets Measured at Fair Value | The following tables present reconciliations of the changes during the three months ended March 31, 2022 and 2021 in Level 3 assets measured at fair value: Debt Securities Mortgage and asset-backed Three Months Ended March 31, 2022 Preferred U.S. Foreign RMBS CMBS Other Asset- Other (1) Total ($ in millions) Balance as of January 1, 2022 $ 1.3 $ 670.3 $ 177.2 $ 1.9 $ — $ 1,348.3 $ — $ 2,199.0 Net realized/unrealized gains (losses) included in: Net earnings (2) — 0.2 — — — — — 0.2 Other comprehensive (loss) — ( 35.5 ) ( 10.0 ) — — ( 12.2 ) — ( 57.7 ) Purchases — 43.3 24.3 — 4.3 62.5 — 134.4 Sales — — — — — ( 28.3 ) — ( 28.3 ) Issuances — — — — — — — — Settlements — ( 4.3 ) ( 2.1 ) ( 0.1 ) — ( 23.2 ) — ( 29.7 ) Transfers into Level 3 — — — — — — — — Transfers out of Level 3 — — — — — ( 18.3 ) — ( 18.3 ) Balance as of March 31, 2022 $ 1.3 $ 674.0 $ 189.4 $ 1.8 $ 4.3 $ 1,328.8 $ — $ 2,199.6 Debt Securities Mortgage and asset-backed Three Months Ended March 31, 2021 Preferred U.S. Foreign RMBS CMBS Other Asset- Other (1) Total ($ in millions) Balance as of January 1, 2021 $ 1.3 $ 631.6 $ 189.5 $ 2.5 $ 5.8 $ 902.7 $ 0.3 $ 1,733.7 Net realized/unrealized gains (losses) included in: Net earnings (2) — 0.2 — — — 0.1 0.1 0.4 Other comprehensive income (loss) — ( 17.1 ) ( 3.9 ) — — 6.7 ( 0.1 ) ( 14.4 ) Purchases — 19.6 2.0 — — 192.2 — 213.8 Sales — — — — — ( 0.1 ) ( 0.3 ) ( 0.4 ) Issuances — — — — — — — — Settlements — ( 23.6 ) ( 1.2 ) ( 0.2 ) — ( 88.1 ) — ( 113.1 ) Transfers into Level 3 — — — — — 5.8 — 5.8 Transfers out of Level 3 — — — — ( 5.8 ) ( 5.1 ) — ( 10.9 ) Balance as of March 31, 2021 $ 1.3 $ 610.7 $ 186.4 $ 2.3 $ — $ 1,014.2 $ — $ 1,814.9 (1) Includes partnership and non-marketable equity investments accounted for at fair value. (2) There wer e minimal or no credit losses recorded in net earnings related to Level 3 instruments still held as of March 31, 2022 and 2021. |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Investments [Abstract] | |
Amortized Cost and Fair Value of Available For Sale Securities | The following tables present the amortized cost and the fair value of AFS securities as of March 31, 2022 and December 31, 2021: Amortized Gross Gross Allowance for Credit Losses Fair Value ($ in millions) As of March 31, 2022 Debt securities: U.S. Government obligations $ 1,649.9 $ 4.0 $ ( 60.9 ) $ — $ 1,593.0 Municipal bonds 2,673.2 39.2 ( 70.5 ) — 2,641.9 Foreign government obligations 844.1 1.7 ( 27.8 ) — 818.0 U.S. corporate bonds 3,421.9 44.4 ( 115.0 ) ( 0.5 ) 3,350.8 Foreign corporate bonds 1,232.6 2.8 ( 48.4 ) ( 0.6 ) 1,186.4 Mortgage and asset-backed securities: RMBS 1,922.0 9.1 ( 99.2 ) — 1,831.9 CMBS 1,068.4 1.9 ( 21.6 ) — 1,048.7 Other asset-backed securities (1) 3,181.1 3.1 ( 96.3 ) — 3,087.9 Total debt securities 15,993.2 106.2 ( 539.7 ) ( 1.1 ) 15,558.6 Short-term investments 1,305.8 — — — 1,305.8 Total investments $ 17,299.0 $ 106.2 $ ( 539.7 ) $ ( 1.1 ) $ 16,864.4 Amortized Gross Gross Allowance for Credit Losses Fair Value ($ in millions) As of December 31, 2021 Debt securities: U.S. Government obligations $ 2,039.7 $ 27.9 $ ( 16.9 ) $ — $ 2,050.7 Municipal bonds 2,412.7 127.3 ( 4.1 ) — 2,535.9 Foreign government obligations 850.8 12.0 ( 7.9 ) — 854.9 U.S. corporate bonds 3,336.9 159.2 ( 18.3 ) ( 0.5 ) 3,477.3 Foreign corporate bonds 1,216.6 19.9 ( 9.6 ) — 1,226.9 Mortgage and asset-backed securities: RMBS 1,993.6 37.2 ( 21.8 ) — 2,009.0 CMBS 879.8 28.3 ( 2.2 ) — 905.9 Other asset-backed securities (1) 2,997.0 22.0 ( 18.0 ) — 3,001.0 Total debt securities 15,727.1 433.8 ( 98.8 ) ( 0.5 ) 16,061.6 Short-term investments 1,142.3 — — — 1,142.3 Total investments $ 16,869.4 $ 433.8 $ ( 98.8 ) $ ( 0.5 ) $ 17,203.9 (1) Includ es $ 1,281.5 million and $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. |
Amortized Cost and Estimated Fair Value of Debt Securities by Contractual Maturity | The following table presents the amortized cost and estimated fair value of debt securities by contractual maturity as of March 31, 2022. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Cost Fair Value ($ in millions) As of March 31, 2022 Short-term investments due in one year or less $ 1,305.8 $ 1,305.8 Mortgage and asset-backed securities (1) 6,171.5 5,968.5 Debt securities with maturity dates: One year or less 557.1 557.6 Over one through five years 3,625.9 3,556.2 Over five through ten years 3,053.7 2,938.8 Over ten years 2,585.0 2,537.5 Total debt securities $ 15,993.2 $ 15,558.6 (1) Mortgage and asset-backed securities by their nature do not generally have single maturity dates. |
Net Investment Income | The following table presents net investment income for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Interest income $ 100.3 $ 99.9 Dividend income 12.7 16.7 Investment expenses ( 7.2 ) ( 6.0 ) Partnerships and other investment results 7.7 42.9 Total $ 113.5 $ 153.5 |
Summary of Changes in Fair Value of Equity Securities | The following table presents changes in the fair value of equity securities for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Change in the fair value of equity securities sold during the period $ ( 18.2 ) $ ( 3.2 ) Change in the fair value of equity securities held at the end of the period ( 120.7 ) 115.9 Change in the fair value of equity securities $ (138.9 ) $ 112.7 |
Amounts of Gross Realized Capital Gains and Gross Realized Capital Losses of Available For Sale Securities | The following table presents amounts of gross realized capital gains and gross realized capital losses for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Gross realized capital gains $ 11.2 $ 20.9 Gross realized capital losses ( 21.2 ) ( 8.0 ) Net realized capital gains $ ( 10.0 ) $ 12.9 |
Allowance for Credit Losses on Available for Sale Securities | The following table presents a rollforward of Alleghany’s allowance for credit losses on AFS securities for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Allowance for Credit Losses Beginning balance $ 0.5 $ 2.6 Provision for credit losses 0.6 ( 2.0 ) Charge-offs — — Recoveries — — Ending balance $ 1.1 $ 0.6 |
Summary of Rating of Debt securities | The following table presents the ratings of Alleghany’s debt securities as of March 31, 2022: Ratings as of March 31, 2022 AAA / Aaa AA / Aa A BBB / Baa Below (1) Total ($ in millions) U.S. Government obligations $ 1.3 $ 1,591.7 $ — $ — $ — $ 1,593.0 Municipal bonds 279.3 1,813.9 462.8 78.1 7.8 2,641.9 Foreign government obligations 361.0 371.8 84.1 1.1 — 818.0 U.S. corporate bonds 14.5 158.3 1,429.0 1,416.9 332.1 3,350.8 Foreign corporate bonds 156.6 65.0 573.1 355.7 36.0 1,186.4 Mortgage and asset-backed securities: RMBS 6.2 1,819.3 0.4 0.8 5.2 1,831.9 CMBS 447.6 368.0 200.6 32.5 — 1,048.7 Other asset-backed securities 1,460.3 677.5 479.9 406.7 63.5 3,087.9 Total debt securities $ 2,726.8 $ 6,865.5 $ 3,229.9 $ 2,291.8 $ 444.6 $ 15,558.6 Percentage of debt securities, before 17.5 % 44.1 % 20.8 % 14.7 % 2.9 % 100.0 % (1) Cons ists of $ 130.6 million of securities rated BB / Ba, $ 188.9 million of securities rated B, $ 31.3 million of securities rated CCC, $ 0.5 million of securities rated CC, $ 2.9 million of securities rated below CC and $ 90.4 million of not rated securities. |
Gross Unrealized Losses and Related Fair Values for AFS Securities before an Allowance for Credit Losses Grouped by Duration of Time in Continuous Unrealized Loss Position | The following tables present gross unrealized losses and related fair values for Alleghany’s AFS securities before an allowance for credit losses, grouped by duration of time in a continuous unrealized loss position, as of March 31, 2022 and December 31, 2021: Less Than 12 Months 12 Months or More Total Fair Value Gross Fair Value Gross Fair Value Gross ($ in millions) As of March 31, 2022 Debt securities: U.S. Government obligations $ 1,224.2 $ 50.4 $ 149.6 $ 10.5 $ 1,373.8 $ 60.9 Municipal bonds 966.9 67.4 25.3 3.1 992.2 70.5 Foreign government obligations 533.2 16.4 138.6 11.4 671.8 27.8 U.S. corporate bonds 1,633.7 85.1 192.9 29.9 1,826.6 115.0 Foreign corporate bonds 804.4 37.3 110.4 11.1 914.8 48.4 Mortgage and asset-backed securities: RMBS 879.0 48.3 551.9 50.9 1,430.9 99.2 CMBS 830.9 18.7 35.4 2.9 866.3 21.6 Other asset-backed securities 2,355.6 84.7 350.9 11.6 2,706.5 96.3 Total temporarily impaired securities $ 9,227.9 $ 408.3 $ 1,555.0 $ 131.4 $ 10,782.9 $ 539.7 Less Than 12 Months 12 Months or More Total Fair Value Gross Fair Value Gross Fair Value Gross ($ in millions) As of December 31, 2021 Debt securities: U.S. Government obligations $ 1,196.3 $ 11.1 $ 122.1 $ 5.8 $ 1,318.4 $ 16.9 Municipal bonds 267.3 4.0 2.8 0.1 270.1 4.1 Foreign government obligations 350.0 5.3 73.2 2.6 423.2 7.9 U.S. corporate bonds 814.2 12.4 79.3 5.9 893.5 18.3 Foreign corporate bonds 460.6 8.3 34.6 1.3 495.2 9.6 Mortgage and asset-backed securities: RMBS 1,072.8 20.5 50.7 1.3 1,123.5 21.8 CMBS 197.8 0.6 40.9 1.6 238.7 2.2 Other asset-backed securities 1,609.9 13.2 291.5 4.8 1,901.4 18.0 Total temporarily impaired securities $ 5,968.9 $ 75.4 $ 695.1 $ 23.4 $ 6,664.0 $ 98.8 |
Allowance for Credit Losses on Commercial Mortgage Loans | The following table presents a rollforward of Alleghany’s allowance for credit losses on commercial mortgage loans for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Allowance for Credit Losses Beginning balance $ 0.2 $ 1.4 Provision for credit losses 0.2 0.2 Charge-offs — — Recoveries — — Ending balance $ 0.4 $ 1.6 |
Reinsurance Ceded (Tables)
Reinsurance Ceded (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Insurance [Abstract] | |
Reinsurance Recoverables After Allowance for Credit Losses | Amounts recoverable from reinsurers are recognized in a manner consistent with the loss and loss adjustment expense (“LAE”) liabilities associated with the reinsurance placement and presented on the balance sheet as reinsurance recoverables, and are recorded after an allowance for credit losses. Such balances as of March 31, 2022 and December 31, 2021 are presented in the table below: As of March 31, As of December 31, 2022 2021 ($ in millions) Reinsurance recoverables on paid losses $ 145.1 $ 173.1 Ceded outstanding loss and LAE 2,022.3 2,026.1 Reinsurance recoverables, before allowance for credit losses 2,167.4 2,199.2 Allowance for credit losses ( 2.7 ) ( 3.2 ) Total $ 2,164.7 $ 2,196.0 |
Information Regarding Concentration of Reinsurance Recoverables and Ratings Profile of Our Reinsurers | The following table presents information regarding concentration of Alleghany’s reinsurance recoverables and the ratings profile of Alleghany's reinsurers as of March 31, 2022: Reinsurer (1) Rating (2) Amount Percentage ($ in millions) PartnerRe Ltd A+ (Superior) $ 161.8 7.5 % Syndicates at Lloyd's of London A (Excellent) 156.8 7.2 % Kane SAC Ltd, Rondout Segregated Account (3) not rated 131.6 6.1 % Fairfax Financial Holdings Ltd A (Excellent) 128.9 5.9 % RenaissanceRe Holdings Ltd A+ (Superior) 128.1 5.9 % Swiss Reinsurance Company A+ (Superior) 99.2 4.6 % Integral Reinsurance Ltd. (3) not rated 86.7 4.0 % Chubb Ltd. A++ (Superior) 80.1 3.7 % W.R. Berkley Corporation A+ (Superior) 76.1 3.5 % SiriusPoint Ltd. (3) A- (Excellent) 70.9 3.3 % All other reinsurers 1,047.2 48.3 % Total reinsurance recoverables, before allowance for credit losses (4) $ 2,167.4 100.0 % Allowance for credit losses ( 2.7 ) Total $ 2,164.7 Secured reinsurance recoverables (3) $ 957.6 44.2 % (1) Reinsurance recoverables reflect amounts due from one or more reinsurance subsidiaries of the listed company. (2) Represents the A.M. Best Company, Inc. financial strength rating for the applicable reinsurance subsidiary or subsidiaries from which the reinsurance recoverable is due. (3) Represents reinsurance recoverables secured by funds held, trust agreements or letters of credit. (4) Approxim ately 66 percent of Alleghany's reinsurance recoverables balance as of March 31, 2022 was due from reinsurers having an A.M. Best Company, Inc. financial strength rating of A (Excellent) or higher, with a majority of the other reinsurance recoverables being secured by funds held, trust agreements or letters of credit. |
Allowance for Credit Losses on Reinsurance Recoverables | The following table presents a rollforward of Alleghany’s allowance for credit losses on reinsurance recoverables for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Allowance for Credit Losses Beginning balance $ 3.2 $ 7.9 Provision for credit losses ( 0.5 ) ( 1.9 ) Charge-offs — — Recoveries — — Ending balance $ 2.7 $ 6.0 |
Liability for Loss and LAE (Tab
Liability for Loss and LAE (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Insurance [Abstract] | |
Activity in Liability for Loss and Loss Adjustment Expense | The following table presents the activity in the liability for loss and LAE for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Reserves as of January 1 $ 14,357.6 $ 12,970.6 Less: reinsurance recoverables (1) 2,026.1 1,703.7 Net reserves as of January 1 12,331.5 11,266.9 Other adjustments ( 0.1 ) — Incurred loss and LAE, net of reinsurance, related to: Current year 995.1 1,168.2 Prior years ( 53.3 ) ( 56.1 ) Total incurred loss and LAE, net of reinsurance 941.8 1,112.1 Paid loss and LAE, net of reinsurance, related to: (2) Current year 68.2 87.4 Prior years 902.1 766.8 Total paid loss and LAE, net of reinsurance 970.3 854.2 Foreign currency exchange rate effect ( 8.8 ) 29.5 Net reserves as of March 31 12,294.1 11,554.3 Reinsurance recoverables as of March 31 (1) 2,022.3 1,738.7 Reserves as of March 31 $ 14,316.4 $ 13,293.0 (1) Reinsurance recoverables in this table include only ceded loss and LAE reserves. (2) Includes paid losses and LAE, net of reinsurance, related to commutations. |
(Favorable) Unfavorable Prior Accident Year Loss Reserve Development | The following table presents the (favorable) unfavorable prior accident year loss reserve development, including from the Pandemic (defined in Note 9(a)), for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Reinsurance Segment Property: Catastrophe events (excluding Pandemic) $ ( 2.4 ) (1) $ ( 4.5 ) (2) Pandemic ( 4.3 ) 29.8 Non-catastrophe ( 12.4 ) (3) ( 11.5 ) (4) Total ( 19.1 ) 13.8 Casualty & specialty: Catastrophe events (excluding Pandemic) ( 1.7 ) ( 1.3 ) Pandemic 0.9 ( 11.8 ) Non-catastrophe ( 30.0 ) (5) ( 54.2 ) (6) Total ( 30.8 ) ( 67.3 ) Total Reinsurance Segment ( 49.9 ) ( 53.5 ) Insurance Segment RSUI: Casualty ( 1.8 ) (7) ( 1.1 ) (8) Property and other ( 4.5 ) (9) ( 1.6 ) (10) Total ( 6.3 ) ( 2.7 ) CapSpecialty 2.9 (11) 0.1 (12) Total incurred related to prior years $ ( 53.3 ) $ ( 56.1 ) (1) Primarily reflects favorable prior accident year loss reserve development related to several catastrophic events in the 2018 and 2019 accident years. (2) Primarily reflects favorable prior accident year loss reserve development related to Hurricane Michael in the 2018 accident year, partially offset by unfavorable prior accident year loss reserve development related to Hurricane Laura in the 2020 accident year. (3) Primarily reflects favorable prior accident year loss reserve development in the 2018 through 2020 accident years. (4) Primarily reflects favorable prior accident year loss reserve development in the 2020 accident year. (5) Primarily reflects favorable prior accident year loss reserve development in the longer-tailed lines of business in the 2008 and prior accident years and shorter-tailed lines of business in the 2019 through 2021 accident years, partially offset by unfavorable prior accident year development in the longer-tailed lines of business in the 2009 through 2018 accident years. (6) Primarily reflects favorable prior accident year loss reserve development in the longer-tailed lines of business in the 2016 and earlier accident years and (7) Primarily reflects favorable prior accident year loss reserve development in in the directors' and officers' liability lines of business in the 2018 and earlier accident years and the umbrella/excess lines of business in the 2015 and earlier accident years. (8) Primarily reflects favorable prior accident year loss reserve development in the umbrella/excess lines of business in the 2007 through 2014 accident years, partially offset by unfavorable prior accident year loss reserve development in the directors' and officers' liability lines of business in the 2013 accident year. (9) Primarily reflects favorable prior accident year loss reserve development related to catastrophe losses in the 2021 accident year and, to a lesser extent, the 2020 accident year. (10) Primarily reflects favorable prior accident year loss reserve development related to catastrophes in the 2017 and 2018 accident years, partially offset by unfavorable prior accident year loss reserve development related to catastrophes in the 2020 accident year. (11) Primarily reflects unfavorable prior accident year loss reserve development in several casualty liability lines of business in the 2014 through 2018 accident years. (12) Primarily reflects unfavorable prior accident year loss reserve development in several casualty lines of business. |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Common Stock Repurchases | The following table presents the shares of Common Stock that Alleghany repurchased in the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 Shares repurchased 144,864 103,025 Cost of shares repurchased (in millions) $ 96.0 $ 63.2 Average price per share repurchased $ 662.60 $ 613.36 |
Reconciliation of Accumulated Other Comprehensive Income (Loss) | The following tables present a reconciliation of the changes during the three months ended March 31, 2022 and 2021 in accumulated other comprehensive income (loss) attributable to Alleghany stockholders: Unrealized Unrealized Retirement Total ($ in millions) Balance as of January 1, 2022 $ 259.1 $ ( 103.7 ) $ ( 13.6 ) $ 141.8 Other comprehensive (loss) income, net of tax: Other comprehensive (loss) income before reclassifications ( 614.3 ) ( 0.5 ) 0.1 ( 614.7 ) Reclassifications from accumulated other comprehensive income 8.4 — — 8.4 Total ( 605.9 ) ( 0.5 ) 0.1 ( 606.3 ) Balance as of March 31, 2022 $ ( 346.8 ) $ ( 104.2 ) $ ( 13.5 ) $ ( 464.5 ) Unrealized Unrealized Retirement Total ($ in millions) Balance as of January 1, 2021 $ 564.9 $ ( 99.4 ) $ ( 13.1 ) $ 452.4 Other comprehensive income (loss), net of tax: Other comprehensive (loss) income before reclassifications ( 217.9 ) 2.5 ( 1.0 ) ( 216.4 ) Reclassifications from accumulated other comprehensive income ( 11.8 ) — — ( 11.8 ) Total ( 229.7 ) 2.5 ( 1.0 ) ( 228.2 ) Balance as of March 31, 2021 $ 335.2 $ ( 96.9 ) $ ( 14.1 ) $ 224.2 |
Reclassifications of Accumulated Other Comprehensive Income (Loss) | The following table presents unrealized appreciation of investment reclassifications out of accumulated other comprehensive income or loss attributable to Alleghany stockholders during the three months ended March 31, 2022 and 2021: Accumulated Other Three Months Ended Comprehensive Income Component Line in Consolidated Statement of Earnings 2022 2021 ($ in millions) Unrealized appreciation of investments: Net realized capital gains $ 10.0 $ ( 12.9 ) Change in allowance for credit losses on 0.6 ( 2.0 ) Income taxes ( 2.2 ) 3.1 Total reclassifications: Net losses (earnings) $ 8.4 $ ( 11.8 ) |
Earnings Per Share of Common _2
Earnings Per Share of Common Stock (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Reconciliation of Earnings and Share Data used in Basic and Diluted (Losses) Earnings per Share Computations | The following table presents a reconciliation of the earnings and share data used in the basic and diluted earnings per share computations for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions, except share amounts) Net earnings available to Alleghany stockholders $ 125.7 $ 230.0 Effect of dilutive securities — ( 0.8 ) Income available to common stockholders for diluted earnings per share $ 125.7 $ 229.2 Weighted average common shares outstanding applicable to basic earnings per share 13,522,787 13,989,410 Effect of dilutive securities — 9,576 Adjusted weighted average common shares outstanding applicable to diluted earnings per share 13,522,787 13,998,986 Contingently issuable shares (1) — 40,789 (1) Contingently issuable shares were potentially available in the periods presented, but were not included in the diluted earnings per share computations because the impact was anti-dilutive to the earnings per share calculation. |
Segments of Business (Tables)
Segments of Business (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Segment Reporting [Abstract] | |
Results for Reportable Segments and Corporate Activities | The following tables present segment results for Alleghany’s three reportable segments and for corporate activities for the three months ended March 31, 2022 and 2021: Reinsurance Segment Insurance Segment Three Months Ended Property Casualty & (1) Total RSUI Cap Total Subtotal Alleghany Total Corporate Activities Consolidated ($ in millions) Gross premiums written $ 454.4 $ 1,074.0 $ 1,528.4 $ 517.4 $ 112.2 $ 629.6 $ 2,158.0 $ — $ 2,158.0 $ ( 11.0 ) $ 2,147.0 Net premiums written 346.6 1,011.4 1,358.0 342.1 92.7 434.8 1,792.8 — 1,792.8 — 1,792.8 Net premiums earned 291.5 871.4 1,162.9 346.4 96.2 442.6 1,605.5 — 1,605.5 — 1,605.5 Net loss and LAE 162.1 560.9 723.0 159.4 59.4 218.8 941.8 — 941.8 — 941.8 Commissions, brokerage and 86.7 281.6 368.3 72.2 36.7 108.9 477.2 — 477.2 — 477.2 Underwriting profit (2) $ 42.7 $ 28.9 $ 71.6 $ 114.8 $ 0.1 $ 114.9 186.5 — 186.5 — 186.5 Net investment income 108.5 — 108.5 5.0 113.5 Change in the fair value of equity securities ( 154.1 ) — ( 154.1 ) 15.2 (138.9 ) Net realized capital gains ( 16.1 ) 6.1 ( 10.0 ) — ( 10.0 ) Change in allowance for credit losses on available for sale securities ( 0.6 ) — ( 0.6 ) — ( 0.6 ) Product and service revenues 8.0 1,121.4 1,129.4 19.8 1,149.2 Other operating expenses 13.6 1,013.3 1,026.9 1.9 1,028.8 Corporate administration — — — 10.7 10.7 Amortization of intangible assets 0.4 13.7 14.1 — 14.1 Interest expense 6.7 5.7 12.4 19.7 32.1 Earnings before income taxes $ 111.5 $ 94.8 $ 206.3 $ 7.7 $ 214.0 Reinsurance Segment Insurance Segment Three Months Ended Property Casualty & (1) Total RSUI Cap Total Subtotal Alleghany Total Corporate Activities Consolidated ($ in millions) Gross premiums written $ 565.3 $ 972.9 $ 1,538.2 $ 420.9 $ 102.2 $ 523.1 $ 2,061.3 $ — $ 2,061.3 $ ( 10.9 ) $ 2,050.4 Net premiums written 459.0 935.9 1,394.9 272.5 87.4 359.9 1,754.8 — 1,754.8 — 1,754.8 Net premiums earned 371.3 858.6 1,229.9 283.6 91.3 374.9 1,604.8 — 1,604.8 — 1,604.8 Net loss and LAE 323.5 525.4 848.9 208.2 55.0 263.2 1,112.1 — 1,112.1 — 1,112.1 Commissions, brokerage and 109.2 266.8 376.0 64.1 35.9 100.0 476.0 — 476.0 — 476.0 Underwriting (loss) profit (2) $ ( 61.4 ) $ 66.4 $ 5.0 $ 11.3 $ 0.4 $ 11.7 16.7 — 16.7 — 16.7 Net investment income 123.1 — 123.1 30.4 153.5 Change in the fair value of equity securities 85.3 — 85.3 27.4 112.7 Net realized capital gains 10.5 0.9 11.4 1.5 12.9 Change in allowance for credit losses on available for sale securities 1.9 — 1.9 0.1 2.0 Product and service revenues 8.6 759.1 767.7 0.1 767.8 Other operating expenses 14.4 709.2 723.6 0.3 723.9 Corporate administration ( 0.5 ) — ( 0.5 ) 10.1 9.6 Amortization of intangible assets 0.2 11.3 11.5 — 11.5 Interest expense 6.8 3.8 10.6 13.1 23.7 Earnings before income taxes $ 225.2 $ 35.7 $ 260.9 $ 36.0 $ 296.9 (1) Primarily consists of the following reinsurance lines of business: directors’ and officers’ liability; errors and omissions liability; general liability; medical malpractice; ocean marine and aviation; auto liability; accident and health; mortgage reinsurance; surety; and credit. (2) Underwriting profit represents net premiums earned less net loss and LAE and commissions, brokerage and other underwriting expenses, all as determined in accordance with GAAP, and does not include net investment income, change in the fair value of equity securities, net realized capital gains, change in allowance for credit losses on available for sale securities, product and service revenues, other operating expenses, corporate administration, amortization of intangible assets or interest expense. Underwriting profit does not replace earnings before income taxes determined in accordance with GAAP as a measure of profitability. Rather, Alleghany believes that underwriting profit enhances the understanding of its reinsurance and insurance segments’ operating results by highlighting net earnings attributable to their underwriting performance. Earnings before income taxes (a GAAP measure) may show a profit despite an underlying underwriting loss. Where underwriting losses persist over extended periods, a reinsurance or an insurance company’s ability to continue as an ongoing concern may be at risk. Therefore, Alleghany views underwriting profit as an important measure in the overall evaluation of performance. |
Summary of Identifiable Assets and Equity | The following table presents identifiable assets, the portion of identifiable assets related to cash and invested assets and equity attributable to Alleghany for Alleghany’s reportable segments and for corporate activities as of March 31, 2022: Identifiable Invested Assets Equity ($ in millions) Reinsurance segment $ 18,771.4 $ 14,734.9 $ 4,892.4 Insurance segment 8,320.4 5,967.3 2,677.8 Subtotal 27,091.8 20,702.2 7,570.2 Alleghany Capital 3,419.2 169.6 1,357.6 Total segments 30,511.0 20,871.8 8,927.8 Corporate activities 1,383.4 1,423.0 ( 332.4 ) Consolidated $ 31,894.4 $ 22,294.8 $ 8,595.4 |
Summary of Alleghany Capital Product and Service Revenues | For Alleghany Capital’s industrial and consumer & services operations, product and service revenues consist of the sale of manufactured goods and services. The following table presents product and service revenues for the Alleghany Capital segment for the three months ended March 31, 2022 and 2021: Three Months Ended 2022 2021 ($ in millions) Industrial (1) $ 461.6 $ 404.4 Consumer & services (2) 659.8 354.7 Corporate & other — — Alleghany Capital $ 1,121.4 $ 759.1 (1) For the three months ended March 31, 2022 and 2021, the vast majority of industrial product and service revenues were recognized as goods and services transferred to customers over time. (2) For the three months ended March 31, 2022 and 2021, approximat ely 59 percent a nd 63 percent, respectively, of consumer & services product and service revenues were recognized as services transferred to customers over time, with the remainder recognized as goods transferred at a point in time. |
Summary of Significant Accoun_4
Summary of Significant Accounting Principles - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | Mar. 20, 2022 | Mar. 31, 2022 | Mar. 31, 2021 | Oct. 14, 2021 | Oct. 13, 2021 |
Significant Accounting Policies [Line Items] | |||||
Accretion reduced capital contribution | $ 16.5 | $ 0 | |||
Berkshire Hathaway Inc. | |||||
Significant Accounting Policies [Line Items] | |||||
Par value of common stock issued and outstanding | $ 1 | ||||
Minimum Alleghany voting power required for the approval of the merger | 75.00% | ||||
Cash offered per share of Alleghany common stock | $ 848.02 | ||||
Purchase price for acquisition | $ 11,600 | ||||
Kentucky Trailer | |||||
Significant Accounting Policies [Line Items] | |||||
Ownership of interest held by noncontrolling partners | 22.00% | ||||
Integrated Project Services LLC | |||||
Significant Accounting Policies [Line Items] | |||||
Ownership of interest held by noncontrolling partners | 18.00% | 18.00% | 15.00% | ||
Jazwares, LLC | |||||
Significant Accounting Policies [Line Items] | |||||
Ownership of interest held by noncontrolling partners | 24.00% | ||||
WWSC Holdings, LLC | |||||
Significant Accounting Policies [Line Items] | |||||
Ownership of interest held by noncontrolling partners | 20.00% | ||||
Concord | |||||
Significant Accounting Policies [Line Items] | |||||
Ownership of interest held by noncontrolling partners | 15.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Principles - Components of Net Earnings Attributable to Noncontrolling Interests (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Noncontrolling Interest [Line Items] | ||
Accretion of redeemable noncontrolling interests | $ 18,800 | $ 600 |
Portion of net earnings attributable to noncontrolling interests | 24,400 | 7,500 |
Total | $ 43,212 | $ 8,022 |
Carrying Values and Estimated F
Carrying Values and Estimated Fair Values of Consolidated Financial Instruments (Detail) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 | |
Assets | |||
Investments (excluding equity method investments and loans) | [1] | $ 20,277.9 | $ 20,887.7 |
Liabilities | |||
Senior notes and other debt | [2] | 2,950.2 | 3,157.9 |
Carrying Value | |||
Assets | |||
Investments (excluding equity method investments and loans) | [1] | 20,277.9 | 20,887.7 |
Liabilities | |||
Senior notes and other debt | [2] | $ 2,822.8 | $ 2,847.2 |
[1] | This table includes debt and equity securities, as well as partnership and non-marketable equity investments accounted for at fair value that are included in other invested assets. This table excludes investments accounted for using the equity method and commercial mortgage loans that are accounted for at unpaid principal balance. The fair value of short-term investments approximates amortized cost. | ||
[2] | See Note 8 to Notes to Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of the 2021 Form 10-K for additional information on the senior notes and other debt. |
Financial Instruments at Fair V
Financial Instruments at Fair Value and Level of Fair Value Hierarchy of Inputs (Detail) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | $ 3,413,525 | $ 3,683,820 | |
Estimated fair value of available for sale debt securities | 15,558,624 | 16,061,560 | |
Estimated fair value of investments (excluding equity method investments and loans) | [1] | 20,277,900 | 20,887,700 |
Senior notes and other debt | [2] | 2,950,200 | 3,157,900 |
Common Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | 3,408,900 | 3,679,200 | |
Preferred Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | 4,600 | 4,600 | |
U.S. Government obligations | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 1,593,000 | 2,050,700 | |
Municipal bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 2,641,900 | 2,535,900 | |
Foreign government obligations | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 818,000 | 854,900 | |
U.S. corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 3,350,800 | 3,477,300 | |
Foreign corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 1,186,400 | 1,226,900 | |
RMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [3] | 1,831,900 | 2,009,000 |
CMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 1,048,700 | 905,900 | |
Other asset-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [4],[5] | 3,087,900 | 3,001,000 |
Short-term Investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of investments (excluding equity method investments and loans) | 1,305,800 | 1,142,300 | |
Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | 3,406,500 | 3,677,100 | |
Estimated fair value of available for sale debt securities | 0 | 0 | |
Estimated fair value of investments (excluding equity method investments and loans) | 3,406,500 | 3,677,100 | |
Senior notes and other debt | 0 | 0 | |
Level 1 | Common Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | 3,406,500 | 3,677,100 | |
Level 1 | Preferred Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | 0 | 0 | |
Level 1 | U.S. Government obligations | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 0 | 0 | |
Level 1 | Municipal bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 0 | 0 | |
Level 1 | Foreign government obligations | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 0 | 0 | |
Level 1 | U.S. corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 0 | 0 | |
Level 1 | Foreign corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 0 | 0 | |
Level 1 | RMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [3] | 0 | 0 |
Level 1 | CMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 0 | 0 | |
Level 1 | Other asset-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [5] | 0 | 0 |
Level 1 | Short-term Investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of investments (excluding equity method investments and loans) | 0 | 0 | |
Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | 5,700 | 5,400 | |
Estimated fair value of available for sale debt securities | 13,360,300 | 13,863,900 | |
Estimated fair value of investments (excluding equity method investments and loans) | 14,671,800 | 15,011,600 | |
Senior notes and other debt | 2,194,200 | 2,377,400 | |
Level 2 | Common Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | 2,400 | 2,100 | |
Level 2 | Preferred Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | 3,300 | 3,300 | |
Level 2 | U.S. Government obligations | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 1,593,000 | 2,050,700 | |
Level 2 | Municipal bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 2,641,900 | 2,535,900 | |
Level 2 | Foreign government obligations | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 818,000 | 854,900 | |
Level 2 | U.S. corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 2,676,800 | 2,807,000 | |
Level 2 | Foreign corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 997,000 | 1,049,700 | |
Level 2 | RMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [3] | 1,830,100 | 2,007,100 |
Level 2 | CMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 1,044,400 | 905,900 | |
Level 2 | Other asset-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [5] | 1,759,100 | 1,652,700 |
Level 2 | Short-term Investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of investments (excluding equity method investments and loans) | 1,305,800 | 1,142,300 | |
Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | 1,300 | 1,300 | |
Estimated fair value of available for sale debt securities | 2,198,300 | 2,197,700 | |
Estimated fair value of investments (excluding equity method investments and loans) | 2,199,600 | 2,199,000 | |
Senior notes and other debt | 756,000 | 780,500 | |
Level 3 | Common Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | 0 | 0 | |
Level 3 | Preferred Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of equities | 1,300 | 1,300 | |
Level 3 | U.S. Government obligations | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 0 | 0 | |
Level 3 | Municipal bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 0 | 0 | |
Level 3 | Foreign government obligations | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 0 | 0 | |
Level 3 | U.S. corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 674,000 | 670,300 | |
Level 3 | Foreign corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 189,400 | 177,200 | |
Level 3 | RMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [3] | 1,800 | 1,900 |
Level 3 | CMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 4,300 | 0 | |
Level 3 | Other asset-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [5] | 1,328,800 | 1,348,300 |
Level 3 | Short-term Investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of investments (excluding equity method investments and loans) | $ 0 | $ 0 | |
[1] | This table includes debt and equity securities, as well as partnership and non-marketable equity investments accounted for at fair value that are included in other invested assets. This table excludes investments accounted for using the equity method and commercial mortgage loans that are accounted for at unpaid principal balance. The fair value of short-term investments approximates amortized cost. | ||
[2] | See Note 8 to Notes to Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of the 2021 Form 10-K for additional information on the senior notes and other debt. | ||
[3] | Primarily includes government agency pass-through securities guaranteed by a government agency or government sponsored enterprise, among other types of RMBS. | ||
[4] | Includ es $ 1,281.5 million and $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. | ||
[5] | Include s $ 1,281.5 million an d $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. |
Financial Instruments at Fair_2
Financial Instruments at Fair Value and Level of Fair Value Hierarchy of Inputs (Parenthetical) (Detail) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | $ 15,558,624 | $ 16,061,560 | |
Other asset-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [1],[2] | 3,087,900 | 3,001,000 |
Collateralized loan obligations | Other asset-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | $ 1,281,500 | $ 1,320,400 | |
[1] | Includ es $ 1,281.5 million and $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. | ||
[2] | Include s $ 1,281.5 million an d $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Gross transfers into Level 3 | $ 0 | $ 5.8 |
Gross transfers out of Level 3 | 18.3 | 10.9 |
U.S. corporate bonds | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Gross transfers into Level 3 | 0 | 0 |
Gross transfers out of Level 3 | 0 | 0 |
CMBS | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Gross transfers into Level 3 | 0 | 0 |
Gross transfers out of Level 3 | 0 | 5.8 |
Other asset-backed securities | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Gross transfers into Level 3 | 0 | 5.8 |
Gross transfers out of Level 3 | $ 18.3 | $ 5.1 |
Reconciliation of Changes in Le
Reconciliation of Changes in Level 3 Assets Measured at Fair Value (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | $ 2,199 | $ 1,733.7 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | 0.2 | 0.4 |
Other comprehensive income (loss) | (57.7) | (14.4) | |
Purchases | 134.4 | 213.8 | |
Sales | (28.3) | (0.4) | |
Issuances | 0 | 0 | |
Settlements | (29.7) | (113.1) | |
Transfers into Level 3 | 0 | 5.8 | |
Transfers out of Level 3 | (18.3) | (10.9) | |
Ending balance | 2,199.6 | 1,814.9 | |
Preferred Stock | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 1.3 | 1.3 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | 0 | 0 |
Other comprehensive income (loss) | 0 | 0 | |
Purchases | 0 | 0 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | 0 | 0 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Ending balance | 1.3 | 1.3 | |
U.S. corporate bonds | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 670.3 | 631.6 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | 0.2 | 0.2 |
Other comprehensive income (loss) | (35.5) | (17.1) | |
Purchases | 43.3 | 19.6 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | (4.3) | (23.6) | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Ending balance | 674 | 610.7 | |
Foreign corporate bonds | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 177.2 | 189.5 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | 0 | 0 |
Other comprehensive income (loss) | (10) | (3.9) | |
Purchases | 24.3 | 2 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | (2.1) | (1.2) | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Ending balance | 189.4 | 186.4 | |
RMBS | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 1.9 | 2.5 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | 0 | 0 |
Other comprehensive income (loss) | 0 | 0 | |
Purchases | 0 | 0 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | (0.1) | (0.2) | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Ending balance | 1.8 | 2.3 | |
CMBS | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 0 | 5.8 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | 0 | 0 |
Other comprehensive income (loss) | 0 | 0 | |
Purchases | 4.3 | 0 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | 0 | 0 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | (5.8) | |
Ending balance | 4.3 | 0 | |
Other asset-backed securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 1,348.3 | 902.7 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | 0 | 0.1 |
Other comprehensive income (loss) | (12.2) | 6.7 | |
Purchases | 62.5 | 192.2 | |
Sales | (28.3) | (0.1) | |
Issuances | 0 | 0 | |
Settlements | (23.2) | (88.1) | |
Transfers into Level 3 | 0 | 5.8 | |
Transfers out of Level 3 | (18.3) | (5.1) | |
Ending balance | 1,328.8 | 1,014.2 | |
Other invested assets | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | [2] | 0 | 0.3 |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1],[2] | 0 | 0.1 |
Other comprehensive income (loss) | [2] | 0 | (0.1) |
Purchases | [2] | 0 | 0 |
Sales | [2] | 0 | (0.3) |
Issuances | [2] | 0 | 0 |
Settlements | [2] | 0 | 0 |
Transfers into Level 3 | [2] | 0 | 0 |
Transfers out of Level 3 | [2] | 0 | 0 |
Ending balance | [2] | $ 0 | $ 0 |
[1] | There wer e minimal or no credit losses recorded in net earnings related to Level 3 instruments still held as of March 31, 2022 and 2021. | ||
[2] | Includes partnership and non-marketable equity investments accounted for at fair value. |
Amortized Cost and Fair Value o
Amortized Cost and Fair Value of Available For Sale Securities (Detail) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
Schedule of Available-for-sale Securities [Line Items] | |||||
Debt securities, amortized cost | $ 15,993,207 | $ 15,727,143 | |||
Debt securities, gross unrealized gains | 106,200 | 433,800 | |||
Debt securities, gross unrealized losses | (539,700) | (98,800) | |||
Debt securities, allowance for credit losses | (1,084) | (502) | $ (600) | $ (2,600) | |
Debt securities, fair value | 15,558,624 | 16,061,560 | |||
Amortized Cost or Cost | 17,299,000 | 16,869,400 | |||
Gross Unrealized Gains | 106,200 | 433,800 | |||
Gross Unrealized Losses | (539,700) | (98,800) | |||
Allowance for Credit Losses | (1,100) | (500) | |||
Fair Value | 16,864,400 | 17,203,900 | |||
U.S. Government obligations | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Debt securities, amortized cost | 1,649,900 | 2,039,700 | |||
Debt securities, gross unrealized gains | 4,000 | 27,900 | |||
Debt securities, gross unrealized losses | (60,900) | (16,900) | |||
Debt securities, allowance for credit losses | 0 | 0 | |||
Debt securities, fair value | 1,593,000 | 2,050,700 | |||
Municipal bonds | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Debt securities, amortized cost | 2,673,200 | 2,412,700 | |||
Debt securities, gross unrealized gains | 39,200 | 127,300 | |||
Debt securities, gross unrealized losses | (70,500) | (4,100) | |||
Debt securities, allowance for credit losses | 0 | 0 | |||
Debt securities, fair value | 2,641,900 | 2,535,900 | |||
Foreign government obligations | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Debt securities, amortized cost | 844,100 | 850,800 | |||
Debt securities, gross unrealized gains | 1,700 | 12,000 | |||
Debt securities, gross unrealized losses | (27,800) | (7,900) | |||
Debt securities, allowance for credit losses | 0 | 0 | |||
Debt securities, fair value | 818,000 | 854,900 | |||
U.S. corporate bonds | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Debt securities, amortized cost | 3,421,900 | 3,336,900 | |||
Debt securities, gross unrealized gains | 44,400 | 159,200 | |||
Debt securities, gross unrealized losses | (115,000) | (18,300) | |||
Debt securities, allowance for credit losses | (500) | (500) | |||
Debt securities, fair value | 3,350,800 | 3,477,300 | |||
Foreign corporate bonds | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Debt securities, amortized cost | 1,232,600 | 1,216,600 | |||
Debt securities, gross unrealized gains | 2,800 | 19,900 | |||
Debt securities, gross unrealized losses | (48,400) | (9,600) | |||
Debt securities, allowance for credit losses | (600) | 0 | |||
Debt securities, fair value | 1,186,400 | 1,226,900 | |||
RMBS | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Debt securities, amortized cost | 1,922,000 | 1,993,600 | |||
Debt securities, gross unrealized gains | 9,100 | 37,200 | |||
Debt securities, gross unrealized losses | (99,200) | (21,800) | |||
Debt securities, allowance for credit losses | 0 | 0 | |||
Debt securities, fair value | [1] | 1,831,900 | 2,009,000 | ||
CMBS | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Debt securities, amortized cost | 1,068,400 | 879,800 | |||
Debt securities, gross unrealized gains | 1,900 | 28,300 | |||
Debt securities, gross unrealized losses | (21,600) | (2,200) | |||
Debt securities, allowance for credit losses | 0 | 0 | |||
Debt securities, fair value | 1,048,700 | 905,900 | |||
Other asset-backed securities | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Debt securities, amortized cost | [2] | 3,181,100 | 2,997,000 | ||
Debt securities, gross unrealized gains | [2] | 3,100 | 22,000 | ||
Debt securities, gross unrealized losses | [2] | (96,300) | (18,000) | ||
Debt securities, allowance for credit losses | [2] | 0 | 0 | ||
Debt securities, fair value | [2],[3] | 3,087,900 | 3,001,000 | ||
Short-term Investments | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Amortized Cost or Cost | 1,305,800 | 1,142,300 | |||
Gross Unrealized Gains | 0 | 0 | |||
Gross Unrealized Losses | 0 | 0 | |||
Allowance for Credit Losses | 0 | 0 | |||
Fair Value | $ 1,305,800 | $ 1,142,300 | |||
[1] | Primarily includes government agency pass-through securities guaranteed by a government agency or government sponsored enterprise, among other types of RMBS. | ||||
[2] | Includ es $ 1,281.5 million and $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. | ||||
[3] | Include s $ 1,281.5 million an d $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. |
Amortized Cost and Fair Value_2
Amortized Cost and Fair Value of Available For Sale Securities (Parenthetical) (Detail) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | |
Schedule of Available-for-sale Securities [Line Items] | |||
Estimated fair value of available for sale debt securities | $ 15,558,624 | $ 16,061,560 | |
Other asset-backed securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Estimated fair value of available for sale debt securities | [1],[2] | 3,087,900 | 3,001,000 |
Other asset-backed securities | Collateralized loan obligations | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Estimated fair value of available for sale debt securities | $ 1,281,500 | $ 1,320,400 | |
[1] | Includ es $ 1,281.5 million and $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. | ||
[2] | Include s $ 1,281.5 million an d $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. |
Amortized Cost and Estimated Fa
Amortized Cost and Estimated Fair Value of Debt Securities by Contractual Maturity (Detail) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |||
Short-term investments due in one year or less, amortized cost | $ 1,305,800 | ||
Mortgage and asset-backed securities, amortized cost | [1] | 6,171,500 | |
Debt securities with maturity dates, amortized cost: | |||
One year or less | 557,100 | ||
Over one through five years | 3,625,900 | ||
Over five through ten years | 3,053,700 | ||
Over ten years | 2,585,000 | ||
Debt securities, amortized cost | 15,993,207 | $ 15,727,143 | |
Short-term investments due in one year or less, fair value | 1,305,804 | 1,142,258 | |
Mortgage and asset-backed securities, fair value | [1] | 5,968,500 | |
Debt securities with maturity dates, fair value: | |||
One year or less | 557,600 | ||
Over one through five years | 3,556,200 | ||
Over five through ten years | 2,938,800 | ||
Over ten years | 2,537,500 | ||
Total debt securities, fair value | $ 15,558,624 | $ 16,061,560 | |
[1] | Mortgage and asset-backed securities by their nature do not generally have single maturity dates. |
Net Investment Income (Detail)
Net Investment Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Investment Income, Net [Abstract] | ||
Interest income | $ 100,300 | $ 99,900 |
Dividend income | 12,700 | 16,700 |
Investment expenses | (7,200) | (6,000) |
Partnerships and other investment results | 7,700 | 42,900 |
Total | $ 113,476 | $ 153,484 |
Investments - Additional Inform
Investments - Additional Information (Detail) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022USD ($)Investment | Mar. 31, 2021USD ($) | Dec. 31, 2021USD ($) | |
Investments [Line Items] | |||
Proceeds from sale of equity securities | $ 276,605 | $ 262,690 | |
Proceeds from sale of debt securities | $ 778,330 | 1,197,630 | |
Securities impairment test description | Alleghany continually monitors the difference between amortized cost and the estimated fair value of its debt investments. The analysis of a security’s decline in value is performed in its functional currency. Debt securities in an unrealized loss position are evaluated for credit losses if they meet any of the following criteria: (i) they are trading at a discount of at least 20 percent to amortized cost and have a credit rating below investment grade or are not rated; (ii) there has been a negative credit or news event with respect to the issuer that could indicate the existence of a credit loss; or (iii) Alleghany intends to sell, or it is more likely than not that Alleghany will sell, the debt security before recovery of its amortized cost basis. If Alleghany intends to sell, or it is more likely than not that Alleghany will sell, a debt security before recovery of its amortized cost basis, the total amount of the unrealized loss position is recognized as a credit loss in earnings. To the extent that a debt security that is in an unrealized loss position is not impaired based on the preceding, Alleghany will consider a debt security to be impaired when it believes it to be probable that Alleghany will not be able to collect the entire amortized cost basis. For debt securities in an unrealized loss position as of the end of each quarter, Alleghany develops a best estimate of the present value of expected cash flows. If the results of the cash flow analysis indicate that Alleghany will not recover the full amount of its amortized cost basis in the debt security, Alleghany records a credit loss in earnings equal to the difference between the present value of expected cash flows and the amortized cost basis of the debt security. If applicable, the difference between the total unrealized loss position on the debt security and the total loss recognized in earnings is the non-credit related portion, which is recorded as a component of other comprehensive income. In developing the cash flow analyses for debt securities, Alleghany considers various factors for the different categories of debt securities. For municipal bonds, Alleghany takes into account the taxing power of the issuer, source of revenue, credit risk and enhancements and pre-refunding. For mortgage and asset-backed securities, Alleghany discounts its best estimate of future cash flows at an effective rate equal to the original effective yield of the security or, in the case of floating rate securities, at the current coupon. Alleghany’s models include assumptions about prepayment speeds, default and delinquency rates, underlying collateral (if any), credit ratings, credit enhancements and other observable market data. For corporate bonds, Alleghany reviews business prospects, credit ratings and available information from asset managers and rating agencies for individual securities. | ||
Changes in allowance for credit losses (reduction) for available for sale securities | $ 582 | $ (1,972) | |
Other invested assets | 561,195 | $ 557,800 | |
Commercial mortgage loans | 462,556 | 475,860 | |
Commercial mortgage loan investments in default or in arrears | $ 0 | ||
Commercial mortgage loan principal amount description | The principal amounts of the loans were no more than approximately two-thirds of the property’s appraised value at the time the loans were made and the estimated fair value of underlying collateral was approximately double that of the commercial mortgage loan portfolio carrying value as of March 31, 2022. | ||
Minimum | |||
Investments [Line Items] | |||
Term of commercial mortgage loans | 2 years | ||
Maximum | |||
Investments [Line Items] | |||
Term of commercial mortgage loans | 10 years | ||
Pillar Capital Holdings Limited And Managed Funds | |||
Investments [Line Items] | |||
Other invested assets | $ 157,300 | $ 156,400 | |
Debt Securities [Member] | |||
Investments [Line Items] | |||
Number of securities in an unrealized loss position | Investment | 3,252 | ||
Number of securities in an unrealized loss position for 12 months or more | Investment | 460 |
Summary of Changes in Fair Valu
Summary of Changes in Fair Value of Equity Securities (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Equity Securities, FV-NI, Gain (Loss) [Abstract] | ||
Change in the fair value of equity securities sold during the period | $ (18,200) | $ (3,200) |
Change in the fair value of equity securities held at the end of the period | (120,700) | 115,900 |
Change in the fair value of equity securities | $ (138,777) | $ 112,728 |
Amounts of Gross Realized Capit
Amounts of Gross Realized Capital Gains and Gross Realized Capital Losses (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | ||
Gross realized capital gains | $ 11,200 | $ 20,900 |
Gross realized capital losses | (21,200) | (8,000) |
Net realized capital gains | $ (10,003) | $ 12,931 |
Allowance for Credit Losses on
Allowance for Credit Losses on Available for Sale Securities (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Financing Receivable Allowance For Credit Losses [Line Items] | ||
Beginning balance | $ 502 | $ 2,600 |
Provision for credit losses | 582 | (1,972) |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Ending balance | $ 1,084 | $ 600 |
Summary of Rating of Debt secur
Summary of Rating of Debt securities (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Dec. 31, 2021 | ||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | $ 15,558,624 | $ 16,061,560 | |
Percentage of debt securities, before allowance for credit losses | 100.00% | ||
AAA / Aaa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | $ 2,726,800 | ||
Percentage of debt securities, before allowance for credit losses | 17.50% | ||
AA / Aa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | $ 6,865,500 | ||
Percentage of debt securities, before allowance for credit losses | 44.10% | ||
A | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | $ 3,229,900 | ||
Percentage of debt securities, before allowance for credit losses | 20.80% | ||
BBB / Baa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | $ 2,291,800 | ||
Percentage of debt securities, before allowance for credit losses | 14.70% | ||
Below BBB / Baa or Not Rated | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | [1] | $ 444,600 | |
Percentage of debt securities, before allowance for credit losses | [1] | 2.90% | |
U.S. Government obligations | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | $ 1,593,000 | 2,050,700 | |
U.S. Government obligations | AAA / Aaa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 1,300 | ||
U.S. Government obligations | AA / Aa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 1,591,700 | ||
U.S. Government obligations | A | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 0 | ||
U.S. Government obligations | BBB / Baa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 0 | ||
U.S. Government obligations | Below BBB / Baa or Not Rated | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | [1] | 0 | |
Municipal bonds | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 2,641,900 | 2,535,900 | |
Municipal bonds | AAA / Aaa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 279,300 | ||
Municipal bonds | AA / Aa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 1,813,900 | ||
Municipal bonds | A | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 462,800 | ||
Municipal bonds | BBB / Baa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 78,100 | ||
Municipal bonds | Below BBB / Baa or Not Rated | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | [1] | 7,800 | |
Foreign government obligations | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 818,000 | 854,900 | |
Foreign government obligations | AAA / Aaa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 361,000 | ||
Foreign government obligations | AA / Aa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 371,800 | ||
Foreign government obligations | A | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 84,100 | ||
Foreign government obligations | BBB / Baa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 1,100 | ||
Foreign government obligations | Below BBB / Baa or Not Rated | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | [1] | 0 | |
U.S. corporate bonds | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 3,350,800 | 3,477,300 | |
U.S. corporate bonds | AAA / Aaa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 14,500 | ||
U.S. corporate bonds | AA / Aa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 158,300 | ||
U.S. corporate bonds | A | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 1,429,000 | ||
U.S. corporate bonds | BBB / Baa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 1,416,900 | ||
U.S. corporate bonds | Below BBB / Baa or Not Rated | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | [1] | 332,100 | |
Foreign corporate bonds | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 1,186,400 | 1,226,900 | |
Foreign corporate bonds | AAA / Aaa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 156,600 | ||
Foreign corporate bonds | AA / Aa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 65,000 | ||
Foreign corporate bonds | A | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 573,100 | ||
Foreign corporate bonds | BBB / Baa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 355,700 | ||
Foreign corporate bonds | Below BBB / Baa or Not Rated | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | [1] | 36,000 | |
RMBS | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | [2] | 1,831,900 | 2,009,000 |
RMBS | AAA / Aaa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 6,200 | ||
RMBS | AA / Aa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 1,819,300 | ||
RMBS | A | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 400 | ||
RMBS | BBB / Baa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 800 | ||
RMBS | Below BBB / Baa or Not Rated | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | [1] | 5,200 | |
CMBS | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 1,048,700 | 905,900 | |
CMBS | AAA / Aaa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 447,600 | ||
CMBS | AA / Aa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 368,000 | ||
CMBS | A | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 200,600 | ||
CMBS | BBB / Baa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 32,500 | ||
CMBS | Below BBB / Baa or Not Rated | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | [1] | 0 | |
Other asset-backed securities | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | [3],[4] | 3,087,900 | $ 3,001,000 |
Other asset-backed securities | AAA / Aaa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 1,460,300 | ||
Other asset-backed securities | AA / Aa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 677,500 | ||
Other asset-backed securities | A | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 479,900 | ||
Other asset-backed securities | BBB / Baa | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | 406,700 | ||
Other asset-backed securities | Below BBB / Baa or Not Rated | |||
Financing Receivable Allowance For Credit Losses [Line Items] | |||
Debt securities, fair value | [1] | $ 63,500 | |
[1] | Cons ists of $ 130.6 million of securities rated BB / Ba, $ 188.9 million of securities rated B, $ 31.3 million of securities rated CCC, $ 0.5 million of securities rated CC, $ 2.9 million of securities rated below CC and $ 90.4 million of not rated securities. | ||
[2] | Primarily includes government agency pass-through securities guaranteed by a government agency or government sponsored enterprise, among other types of RMBS. | ||
[3] | Includ es $ 1,281.5 million and $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. | ||
[4] | Include s $ 1,281.5 million an d $ 1,320.4 million of collateralized loan obligations as of March 31, 2022 and December 31, 2021, respectively. |
Summary of Rating of Debt sec_2
Summary of Rating of Debt securities (Parenthetical) (Detail) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Financing Receivable Allowance For Credit Losses [Line Items] | ||
Debt securities | $ 15,558,624 | $ 16,061,560 |
BB / Ba | ||
Financing Receivable Allowance For Credit Losses [Line Items] | ||
Debt securities | 130,600 | |
B | ||
Financing Receivable Allowance For Credit Losses [Line Items] | ||
Debt securities | 188,900 | |
CCC | ||
Financing Receivable Allowance For Credit Losses [Line Items] | ||
Debt securities | 31,300 | |
CC | ||
Financing Receivable Allowance For Credit Losses [Line Items] | ||
Debt securities | 500 | |
Below CC | ||
Financing Receivable Allowance For Credit Losses [Line Items] | ||
Debt securities | 2,900 | |
Not rated securities | ||
Financing Receivable Allowance For Credit Losses [Line Items] | ||
Debt securities | $ 90,400 |
Gross Unrealized Losses and Rel
Gross Unrealized Losses and Related Fair Values for AFS Securities before an Allowance for Credit Losses Grouped by Duration of Time in Continuous Unrealized Loss Position (Detail) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | $ 9,227.9 | $ 5,968.9 |
Securities, less than 12 months, gross unrealized losses | 408.3 | 75.4 |
Securities, 12 months or more, fair value | 1,555 | 695.1 |
Securities, 12 months or more, gross unrealized losses | 131.4 | 23.4 |
Total, fair value | 10,782.9 | 6,664 |
Total, gross unrealized losses | 539.7 | 98.8 |
U.S. Government obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 1,224.2 | 1,196.3 |
Securities, less than 12 months, gross unrealized losses | 50.4 | 11.1 |
Securities, 12 months or more, fair value | 149.6 | 122.1 |
Securities, 12 months or more, gross unrealized losses | 10.5 | 5.8 |
Total, fair value | 1,373.8 | 1,318.4 |
Total, gross unrealized losses | 60.9 | 16.9 |
Municipal bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 966.9 | 267.3 |
Securities, less than 12 months, gross unrealized losses | 67.4 | 4 |
Securities, 12 months or more, fair value | 25.3 | 2.8 |
Securities, 12 months or more, gross unrealized losses | 3.1 | 0.1 |
Total, fair value | 992.2 | 270.1 |
Total, gross unrealized losses | 70.5 | 4.1 |
Foreign government obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 533.2 | 350 |
Securities, less than 12 months, gross unrealized losses | 16.4 | 5.3 |
Securities, 12 months or more, fair value | 138.6 | 73.2 |
Securities, 12 months or more, gross unrealized losses | 11.4 | 2.6 |
Total, fair value | 671.8 | 423.2 |
Total, gross unrealized losses | 27.8 | 7.9 |
U.S. corporate bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 1,633.7 | 814.2 |
Securities, less than 12 months, gross unrealized losses | 85.1 | 12.4 |
Securities, 12 months or more, fair value | 192.9 | 79.3 |
Securities, 12 months or more, gross unrealized losses | 29.9 | 5.9 |
Total, fair value | 1,826.6 | 893.5 |
Total, gross unrealized losses | 115 | 18.3 |
Foreign corporate bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 804.4 | 460.6 |
Securities, less than 12 months, gross unrealized losses | 37.3 | 8.3 |
Securities, 12 months or more, fair value | 110.4 | 34.6 |
Securities, 12 months or more, gross unrealized losses | 11.1 | 1.3 |
Total, fair value | 914.8 | 495.2 |
Total, gross unrealized losses | 48.4 | 9.6 |
RMBS | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 879 | 1,072.8 |
Securities, less than 12 months, gross unrealized losses | 48.3 | 20.5 |
Securities, 12 months or more, fair value | 551.9 | 50.7 |
Securities, 12 months or more, gross unrealized losses | 50.9 | 1.3 |
Total, fair value | 1,430.9 | 1,123.5 |
Total, gross unrealized losses | 99.2 | 21.8 |
CMBS | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 830.9 | 197.8 |
Securities, less than 12 months, gross unrealized losses | 18.7 | 0.6 |
Securities, 12 months or more, fair value | 35.4 | 40.9 |
Securities, 12 months or more, gross unrealized losses | 2.9 | 1.6 |
Total, fair value | 866.3 | 238.7 |
Total, gross unrealized losses | 21.6 | 2.2 |
Other asset-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 2,355.6 | 1,609.9 |
Securities, less than 12 months, gross unrealized losses | 84.7 | 13.2 |
Securities, 12 months or more, fair value | 350.9 | 291.5 |
Securities, 12 months or more, gross unrealized losses | 11.6 | 4.8 |
Total, fair value | 2,706.5 | 1,901.4 |
Total, gross unrealized losses | $ 96.3 | $ 18 |
Allowance for Credit Losses o_2
Allowance for Credit Losses on Commercial Mortgage Loans (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Financing Receivable Allowance For Credit Losses [Line Items] | ||
Beginning balance | $ 0.2 | $ 1.4 |
Provision for credit losses | 0.2 | 0.2 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Ending balance | $ 0.4 | $ 1.6 |
Reinsurance Ceded - Additional
Reinsurance Ceded - Additional Information (Detail) - Reinsurance Segment | 3 Months Ended |
Mar. 31, 2022 | |
Effects Of Reinsurance [Line Items] | |
Retrocession protection term | 1 year |
Term of catastrophe bonds | 4 years |
Reinsurance Recoverables After
Reinsurance Recoverables After Allowance for Credit Losses (Detail) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
Insurance [Abstract] | |||||
Reinsurance recoverables on paid losses | $ 145,100 | $ 173,100 | |||
Ceded outstanding loss and LAE | [1] | 2,022,300 | 2,026,100 | $ 1,738,700 | $ 1,703,700 |
Reinsurance recoverables, before allowance for credit losses | 2,167,400 | 2,199,200 | |||
Allowance for credit losses | (2,700) | (3,200) | $ (6,000) | $ (7,900) | |
Total | $ 2,164,653 | $ 2,195,975 | |||
[1] | Reinsurance recoverables in this table include only ceded loss and LAE reserves. |
Information Regarding Concentra
Information Regarding Concentration of Reinsurance Recoverables and The Ratings Profile of Our Reinsurers (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||||
Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | ||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | $ 2,167,400 | $ 2,199,200 | |||
Allowance for credit losses | (2,700) | (3,200) | $ (6,000) | $ (7,900) | |
Reinsurance recoverables | 2,164,653 | $ 2,195,975 | |||
Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [1],[2] | 2,167,400 | |||
Allowance for credit losses | [2] | (2,700) | |||
Reinsurance recoverables | [2] | $ 2,164,700 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [1],[2] | 100.00% | |||
Syndicates at Lloyd's of London | A (Excellent) | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [2],[3] | $ 156,800 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[3] | 7.20% | |||
Kane SAC Ltd, Rondout Segregated Account | Not Rated | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [2],[3],[4] | $ 131,600 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[3],[4] | 6.10% | |||
PartnerRe Limited | A+ (Superior) | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [2],[3] | $ 161,800 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[3] | 7.50% | |||
RenaissanceRe Holdings Ltd | A+ (Superior) | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [2],[3] | $ 128,100 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[3] | 5.90% | |||
Fairfax Financial Holdings Ltd | A (Excellent) | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [2],[3] | $ 128,900 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[3] | 5.90% | |||
Swiss Reinsurance Company | A+ (Superior) | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [2],[3] | $ 99,200 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[3] | 4.60% | |||
Integral Reinsurance Ltd | Not Rated | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [2],[3],[4] | $ 86,700 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[3],[4] | 4.00% | |||
Chubb Ltd. | A++ (Superior) | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [2],[3] | $ 80,100 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[3] | 3.70% | |||
W.R. Berkley Corporation | A+ (Superior) | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [2],[3] | $ 76,100 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[3] | 3.50% | |||
SiriusPoint Ltd. | A- (Excellent) | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [2],[3],[4] | $ 70,900 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[3],[4] | 3.30% | |||
All other reinsurers | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables, before allowance for credit losses | [2] | $ 1,047,200 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2] | 48.30% | |||
Ceded Credit Risk, Secured | Reinsurance Recoverable | Reinsurer Concentration Risk | |||||
Ceded Credit Risk [Line Items] | |||||
Reinsurance recoverables | [2],[4] | $ 957,600 | |||
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[4] | 44.20% | |||
[1] | Approxim ately 66 percent of Alleghany's reinsurance recoverables balance as of March 31, 2022 was due from reinsurers having an A.M. Best Company, Inc. financial strength rating of A (Excellent) or higher, with a majority of the other reinsurance recoverables being secured by funds held, trust agreements or letters of credit. | ||||
[2] | Reinsurance recoverables reflect amounts due from one or more reinsurance subsidiaries of the listed company. | ||||
[3] | Represents the A.M. Best Company, Inc. financial strength rating for the applicable reinsurance subsidiary or subsidiaries from which the reinsurance recoverable is due. | ||||
[4] | Represents reinsurance recoverables secured by funds held, trust agreements or letters of credit. |
Information Regarding Concent_2
Information Regarding Concentration of Reinsurance Recoverables and The Ratings Profile of Our Reinsurers (Parenthetical) (Detail) - Reinsurance Recoverable - Reinsurer Concentration Risk | 3 Months Ended | |
Mar. 31, 2022 | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable as percentage of total reinsurance recoverables | 100.00% | [1],[2] |
Reinsurers Rated A Or Higher | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable as percentage of total reinsurance recoverables | 66.00% | |
[1] | Approxim ately 66 percent of Alleghany's reinsurance recoverables balance as of March 31, 2022 was due from reinsurers having an A.M. Best Company, Inc. financial strength rating of A (Excellent) or higher, with a majority of the other reinsurance recoverables being secured by funds held, trust agreements or letters of credit. | |
[2] | Reinsurance recoverables reflect amounts due from one or more reinsurance subsidiaries of the listed company. |
Allowance for Credit Losses o_3
Allowance for Credit Losses on Reinsurance Recoverables (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Allowance for Credit Losses | ||
Beginning balance | $ 3.2 | $ 7.9 |
Provision for credit losses | (0.5) | (1.9) |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Ending balance | $ 2.7 | $ 6 |
Liability for Loss and LAE - Ac
Liability for Loss and LAE - Activity in the Liability for Loss and Loss Adjustment Expense (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | ||
Activity in liability for loss and loss adjustment expense | |||
Reserves as of January 1 | $ 14,357,635 | $ 12,970,600 | |
Less: reinsurance recoverables | [1] | 2,026,100 | 1,703,700 |
Net reserves as of January 1 | 12,331,500 | 11,266,900 | |
Other adjustments | (100) | 0 | |
Incurred loss and LAE, net of reinsurance, related to: | |||
Current year | 995,100 | 1,168,200 | |
Prior years | (53,300) | (56,100) | |
Total incurred loss and LAE, net of reinsurance | 941,787 | 1,112,070 | |
Paid loss and LAE, net of reinsurance, related to: | |||
Current year | [2] | 68,200 | 87,400 |
Prior years | [2] | 902,100 | 766,800 |
Total paid loss and LAE, net of reinsurance | [2] | 970,300 | 854,200 |
Foreign currency exchange rate effect | (8,800) | 29,500 | |
Net reserves as of March 31 | 12,294,100 | 11,554,300 | |
Reinsurance recoverables as of March 31 | [1] | 2,022,300 | 1,738,700 |
Reserves as of March 31 | $ 14,316,367 | $ 13,293,000 | |
[1] | Reinsurance recoverables in this table include only ceded loss and LAE reserves. | ||
[2] | Includes paid losses and LAE, net of reinsurance, related to commutations. |
Liability for Loss and LAE - (F
Liability for Loss and LAE - (Favorable) Unfavorable Prior Accident Year Loss Reserve Development (Detail) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2022 | Mar. 31, 2021 | |||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | $ (53.3) | $ (56.1) | ||
Reinsurance Segment | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | (49.9) | (53.5) | ||
Reinsurance Segment | Property | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | (19.1) | 13.8 | ||
Reinsurance Segment | Property | Catastrophe Events (Excluding Pandemic) | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | (2.4) | [1] | (4.5) | [2] |
Reinsurance Segment | Property | Pandemic | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | (4.3) | 29.8 | ||
Reinsurance Segment | Property | Non-catastrophe | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | (12.4) | [3] | (11.5) | [4] |
Reinsurance Segment | Casualty & Specialty | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | (30.8) | (67.3) | ||
Reinsurance Segment | Casualty & Specialty | Catastrophe Events (Excluding Pandemic) | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | (1.7) | (1.3) | ||
Reinsurance Segment | Casualty & Specialty | Pandemic | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | 0.9 | (11.8) | ||
Reinsurance Segment | Casualty & Specialty | Non-catastrophe | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | (30) | [5] | (54.2) | [6] |
Insurance Segment | RSUI | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | (6.3) | (2.7) | ||
Insurance Segment | RSUI | Casualty Insurance | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | (1.8) | [7] | (1.1) | [8] |
Insurance Segment | RSUI | Property and Other Insurance | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | (4.5) | [9] | (1.6) | [10] |
Insurance Segment | CapSpecialty Incorporated | ||||
Claims Development [Line Items] | ||||
Claims incurred related to prior years | $ 2.9 | [11] | $ 0.1 | [12] |
[1] | Primarily reflects favorable prior accident year loss reserve development related to several catastrophic events in the 2018 and 2019 accident years. | |||
[2] | Primarily reflects favorable prior accident year loss reserve development related to Hurricane Michael in the 2018 accident year, partially offset by unfavorable prior accident year loss reserve development related to Hurricane Laura in the 2020 accident year. | |||
[3] | Primarily reflects favorable prior accident year loss reserve development in the 2018 through 2020 accident years. | |||
[4] | Primarily reflects favorable prior accident year loss reserve development in the 2020 accident year. | |||
[5] | Primarily reflects favorable prior accident year loss reserve development in the longer-tailed lines of business in the 2008 and prior accident years and shorter-tailed lines of business in the 2019 through 2021 accident years, partially offset by unfavorable prior accident year development in the longer-tailed lines of business in the 2009 through 2018 accident years. | |||
[6] | Primarily reflects favorable prior accident year loss reserve development in the longer-tailed lines of business in the 2016 and earlier accident years and | |||
[7] | Primarily reflects favorable prior accident year loss reserve development in in the directors' and officers' liability lines of business in the 2018 and earlier accident years and the umbrella/excess lines of business in the 2015 and earlier accident years. | |||
[8] | Primarily reflects favorable prior accident year loss reserve development in the umbrella/excess lines of business in the 2007 through 2014 accident years, partially offset by unfavorable prior accident year loss reserve development in the directors' and officers' liability lines of business in the 2013 accident year. | |||
[9] | Primarily reflects favorable prior accident year loss reserve development related to catastrophe losses in the 2021 accident year and, to a lesser extent, the 2020 accident year. | |||
[10] | Primarily reflects favorable prior accident year loss reserve development related to catastrophes in the 2017 and 2018 accident years, partially offset by unfavorable prior accident year loss reserve development related to catastrophes in the 2020 accident year. | |||
[11] | Primarily reflects unfavorable prior accident year loss reserve development in several casualty liability lines of business in the 2014 through 2018 accident years. | |||
[12] | Primarily reflects unfavorable prior accident year loss reserve development in several casualty lines of business. |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate | 21.10% | 19.80% |
Interest or penalties accrued for uncertain tax positions | $ 0 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) $ in Millions | Mar. 31, 2022 | Sep. 30, 2019 |
Stockholders Equity Note [Line Items] | ||
Remaining authorized repurchases under share repurchase program | $ 45.9 | |
Stock Repurchase Programs 2019 | ||
Stockholders Equity Note [Line Items] | ||
Aggregate amount of common stock authorized for repurchase | $ 500 |
Schedule of Common Stock Repurc
Schedule of Common Stock Repurchases (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Stockholders' Equity Note [Abstract] | ||
Shares repurchased | 144,864 | 103,025 |
Cost of shares repurchased | $ 95,987 | $ 63,192 |
Average price per share repurchased | $ 662.60 | $ 613.36 |
Reconciliation of Accumulated O
Reconciliation of Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | $ 9,186,882 | $ 8,755,720 |
Other comprehensive (loss) income, net of tax: | ||
Ending Balance | 8,595,373 | 8,695,881 |
Unrealized Appreciation of Investments | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | 259,100 | 564,900 |
Other comprehensive (loss) income, net of tax: | ||
Other comprehensive (loss) income before reclassifications | (614,300) | (217,900) |
Reclassifications from accumulated other comprehensive income | 8,400 | (11,800) |
Total | (605,900) | (229,700) |
Ending Balance | (346,800) | 335,200 |
Unrealized Currency Translation Adjustment | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | (103,700) | (99,400) |
Other comprehensive (loss) income, net of tax: | ||
Other comprehensive (loss) income before reclassifications | (500) | 2,500 |
Reclassifications from accumulated other comprehensive income | 0 | 0 |
Total | (500) | 2,500 |
Ending Balance | (104,200) | (96,900) |
Retirement Plans | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | (13,600) | (13,100) |
Other comprehensive (loss) income, net of tax: | ||
Other comprehensive (loss) income before reclassifications | 100 | (1,000) |
Reclassifications from accumulated other comprehensive income | 0 | 0 |
Total | 100 | (1,000) |
Ending Balance | (13,500) | (14,100) |
Accumulated Other Comprehensive Income (loss) | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | 141,822 | 452,402 |
Other comprehensive (loss) income, net of tax: | ||
Other comprehensive (loss) income before reclassifications | (614,700) | (216,400) |
Reclassifications from accumulated other comprehensive income | 8,400 | (11,800) |
Total | (606,300) | (228,200) |
Ending Balance | $ (464,460) | $ 224,190 |
Reclassifications of Accumulate
Reclassifications of Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Net realized capital gains | $ 10,003 | $ (12,931) |
Change in allowance for credit losses on available for sale securities | 582 | (1,972) |
Income taxes | 45,082 | 58,867 |
Unrealized Appreciation of Investments | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Total reclassifications | 8,400 | (11,800) |
Reclassification out of Accumulated Other Comprehensive Income | Unrealized Appreciation of Investments | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Net realized capital gains | 10,000 | (12,900) |
Change in allowance for credit losses on available for sale securities | 600 | (2,000) |
Income taxes | $ (2,200) | $ 3,100 |
Reconciliation of Earnings and
Reconciliation of Earnings and Share Data used in Basic and Diluted Earnings per Share Computations (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | ||
Earnings Per Share [Abstract] | |||
Net earnings available to Alleghany stockholders | $ 125,681 | $ 230,041 | |
Effect of dilutive securities | 0 | (800) | |
Income available to common stockholders for diluted earnings per share | $ 125,700 | $ 229,200 | |
Weighted average common shares outstanding applicable to basic earnings per share | 13,522,787 | 13,989,410 | |
Effect of dilutive securities | 0 | 9,576 | |
Adjusted weighted average common shares outstanding applicable to diluted earnings per share | 13,522,787 | 13,998,986 | |
Contingently issuable shares | [1] | 0 | 40,789 |
[1] | Contingently issuable shares were potentially available in the periods presented, but were not included in the diluted earnings per share computations because the impact was anti-dilutive to the earnings per share calculation. |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Commitments and Contingencies Disclosure [Line Items] | ||
Investment in other invested asset | $ 561,195 | $ 557,800 |
Hotel Development Projects | ||
Commitments and Contingencies Disclosure [Line Items] | ||
Investment in other invested asset | 5,300 | |
Hotel Development Projects | Maximum | ||
Commitments and Contingencies Disclosure [Line Items] | ||
Guaranteed debt of entities | $ 5,300 |
Segments of Business - Addition
Segments of Business - Additional Information (Detail) $ in Thousands | Oct. 14, 2021USD ($) | Mar. 31, 2022USD ($)Segment | Dec. 31, 2021USD ($) | Oct. 13, 2021 |
Segment Reporting Information [Line Items] | ||||
Number of reportable segments | Segment | 3 | |||
Senior notes and other debt | $ 2,822,777 | $ 2,847,199 | ||
Goodwill | $ 754,648 | 753,607 | ||
Integrated Project Services L L C [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Ownership of interest held by noncontrolling interests | 18.00% | 18.00% | 15.00% | |
Anchorbuoy Limited Acquisition By Integrated Project Services Llc [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Purchase price for acquisition | $ 262,500 | |||
Cash consideration paid for acquisition | 98,600 | |||
Incremental debt | 125,100 | |||
Goodwill | 102,100 | |||
Issuance of Non controlling interest | 38,800 | |||
Anchorbuoy Limited Acquisition By Integrated Project Services Llc [Member] | Trade Names and Trade Marks [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Indefinite lived intangible assets | 15,500 | |||
Anchorbuoy Limited Acquisition By Integrated Project Services Llc [Member] | Alleghany Corporation | ||||
Segment Reporting Information [Line Items] | ||||
Contribution from Alleghany | 97,400 | |||
Anchorbuoy Limited Acquisition By Integrated Project Services Llc [Member] | Customer Relationships | ||||
Segment Reporting Information [Line Items] | ||||
Finite lived intangible assets | $ 124,700 | |||
Operating Segments | Alleghany Capital Corporation Segment | ||||
Segment Reporting Information [Line Items] | ||||
Senior notes and other debt | $ 756,000 | $ 780,500 | ||
Operating Segments | Alleghany Capital Corporation Segment | Integrated Project Services L L C [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Senior notes and other debt | 172,100 | |||
Operating Segments | Alleghany Capital Corporation Segment | Jazwares, LLC | ||||
Segment Reporting Information [Line Items] | ||||
Senior notes and other debt | 267,900 | |||
Operating Segments | Alleghany Capital Corporation Segment | Kentucky Trailer | ||||
Segment Reporting Information [Line Items] | ||||
Senior notes and other debt | 60,400 | |||
Operating Segments | Alleghany Capital Corporation Segment | Wilbert Funeral Services, Inc | ||||
Segment Reporting Information [Line Items] | ||||
Senior notes and other debt | 74,700 | |||
Operating Segments | Alleghany Capital Corporation Segment | WWSC Holdings, LLC | ||||
Segment Reporting Information [Line Items] | ||||
Senior notes and other debt | 125,400 | |||
Operating Segments | Alleghany Capital Corporation Segment | Piedmont Manufacturing Group, LLC | ||||
Segment Reporting Information [Line Items] | ||||
Senior notes and other debt | 31,400 | |||
Operating Segments | Alleghany Capital Corporation Segment | Precision Cutting Technologies, Inc | ||||
Segment Reporting Information [Line Items] | ||||
Senior notes and other debt | 24,100 | |||
Operating Segments | Alleghany Capital Corporation Segment | Concord | Floating Rate Debt Funded by Alleghany Corporation | ||||
Segment Reporting Information [Line Items] | ||||
Senior notes and other debt | $ 33,000 |
Results for Reportable Segments
Results for Reportable Segments and Corporate Activities (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | ||
Segment Reporting Information [Line Items] | |||
Gross premiums written | $ 2,147,000 | $ 2,050,400 | |
Net premiums written | 1,792,800 | 1,754,800 | |
Net premiums earned | 1,605,458 | 1,604,763 | |
Net loss and LAE | 941,787 | 1,112,070 | |
Commissions, brokerage and other underwriting expenses | 477,165 | 476,036 | |
Underwriting (loss) profit | [1] | 186,500 | 16,700 |
Net investment income | 113,476 | 153,484 | |
Change in the fair value of equity securities | (138,777) | 112,728 | |
Net realized capital gains | (10,003) | 12,931 | |
Change in allowance for credit losses on available for sale securities | (582) | 1,972 | |
Product and service revenues | 1,149,162 | 767,835 | |
Other operating expenses | 1,028,892 | 723,889 | |
Corporate administration | 10,723 | 9,558 | |
Amortization of intangible assets | 14,082 | 11,478 | |
Interest expense | 32,110 | 23,752 | |
Earnings before income taxes | 213,975 | 296,930 | |
Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Gross premiums written | 2,158,000 | 2,061,300 | |
Net premiums written | 1,792,800 | 1,754,800 | |
Net premiums earned | 1,605,500 | 1,604,800 | |
Net loss and LAE | 941,800 | 1,112,100 | |
Commissions, brokerage and other underwriting expenses | 477,200 | 476,000 | |
Underwriting (loss) profit | [1] | 186,500 | 16,700 |
Net investment income | 108,500 | 123,100 | |
Change in the fair value of equity securities | (154,100) | 85,300 | |
Net realized capital gains | (10,000) | 11,400 | |
Change in allowance for credit losses on available for sale securities | (600) | 1,900 | |
Product and service revenues | 1,129,400 | 767,700 | |
Other operating expenses | 1,026,900 | 723,600 | |
Corporate administration | 0 | (500) | |
Amortization of intangible assets | 14,100 | 11,500 | |
Interest expense | 12,400 | 10,600 | |
Earnings before income taxes | 206,300 | 260,900 | |
Operating Segments | Reinsurance Segment | |||
Segment Reporting Information [Line Items] | |||
Gross premiums written | 1,528,400 | 1,538,200 | |
Net premiums written | 1,358,000 | 1,394,900 | |
Net premiums earned | 1,162,900 | 1,229,900 | |
Net loss and LAE | 723,000 | 848,900 | |
Commissions, brokerage and other underwriting expenses | 368,300 | 376,000 | |
Underwriting (loss) profit | [1] | 71,600 | 5,000 |
Operating Segments | Reinsurance Segment | Property | |||
Segment Reporting Information [Line Items] | |||
Gross premiums written | 454,400 | 565,300 | |
Net premiums written | 346,600 | 459,000 | |
Net premiums earned | 291,500 | 371,300 | |
Net loss and LAE | 162,100 | 323,500 | |
Commissions, brokerage and other underwriting expenses | 86,700 | 109,200 | |
Underwriting (loss) profit | [1] | 42,700 | (61,400) |
Operating Segments | Reinsurance Segment | Casualty & Specialty | |||
Segment Reporting Information [Line Items] | |||
Gross premiums written | [2] | 1,074,000 | 972,900 |
Net premiums written | [2] | 1,011,400 | 935,900 |
Net premiums earned | [2] | 871,400 | 858,600 |
Net loss and LAE | [2] | 560,900 | 525,400 |
Commissions, brokerage and other underwriting expenses | [2] | 281,600 | 266,800 |
Underwriting (loss) profit | [1],[2] | 28,900 | 66,400 |
Operating Segments | Insurance Segment | |||
Segment Reporting Information [Line Items] | |||
Gross premiums written | 629,600 | 523,100 | |
Net premiums written | 434,800 | 359,900 | |
Net premiums earned | 442,600 | 374,900 | |
Net loss and LAE | 218,800 | 263,200 | |
Commissions, brokerage and other underwriting expenses | 108,900 | 100,000 | |
Underwriting (loss) profit | [1] | 114,900 | 11,700 |
Operating Segments | Insurance Segment | RSUI | |||
Segment Reporting Information [Line Items] | |||
Gross premiums written | 517,400 | 420,900 | |
Net premiums written | 342,100 | 272,500 | |
Net premiums earned | 346,400 | 283,600 | |
Net loss and LAE | 159,400 | 208,200 | |
Commissions, brokerage and other underwriting expenses | 72,200 | 64,100 | |
Underwriting (loss) profit | [1] | 114,800 | 11,300 |
Operating Segments | Insurance Segment | CapSpecialty Incorporated | |||
Segment Reporting Information [Line Items] | |||
Gross premiums written | 112,200 | 102,200 | |
Net premiums written | 92,700 | 87,400 | |
Net premiums earned | 96,200 | 91,300 | |
Net loss and LAE | 59,400 | 55,000 | |
Commissions, brokerage and other underwriting expenses | 36,700 | 35,900 | |
Underwriting (loss) profit | [1] | 100 | 400 |
Operating Segments | Reinsurance Segment and Insurance Segment | |||
Segment Reporting Information [Line Items] | |||
Gross premiums written | 2,158,000 | 2,061,300 | |
Net premiums written | 1,792,800 | 1,754,800 | |
Net premiums earned | 1,605,500 | 1,604,800 | |
Net loss and LAE | 941,800 | 1,112,100 | |
Commissions, brokerage and other underwriting expenses | 477,200 | 476,000 | |
Underwriting (loss) profit | [1] | 186,500 | 16,700 |
Net investment income | 108,500 | 123,100 | |
Change in the fair value of equity securities | (154,100) | 85,300 | |
Net realized capital gains | (16,100) | 10,500 | |
Change in allowance for credit losses on available for sale securities | (600) | 1,900 | |
Product and service revenues | 8,000 | 8,600 | |
Other operating expenses | 13,600 | 14,400 | |
Corporate administration | 0 | (500) | |
Amortization of intangible assets | 400 | 200 | |
Interest expense | 6,700 | 6,800 | |
Earnings before income taxes | 111,500 | 225,200 | |
Operating Segments | Alleghany Capital Corporation Segment | |||
Segment Reporting Information [Line Items] | |||
Gross premiums written | 0 | 0 | |
Net premiums written | 0 | 0 | |
Net premiums earned | 0 | 0 | |
Net loss and LAE | 0 | 0 | |
Commissions, brokerage and other underwriting expenses | 0 | 0 | |
Underwriting (loss) profit | [1] | 0 | 0 |
Net investment income | 0 | 0 | |
Change in the fair value of equity securities | 0 | 0 | |
Net realized capital gains | 6,100 | 900 | |
Change in allowance for credit losses on available for sale securities | 0 | 0 | |
Product and service revenues | 1,121,400 | 759,100 | |
Other operating expenses | 1,013,300 | 709,200 | |
Corporate administration | 0 | 0 | |
Amortization of intangible assets | 13,700 | 11,300 | |
Interest expense | 5,700 | 3,800 | |
Earnings before income taxes | 94,800 | 35,700 | |
Corporate activities | |||
Segment Reporting Information [Line Items] | |||
Gross premiums written | (11,000) | (10,900) | |
Net premiums written | 0 | 0 | |
Net premiums earned | 0 | 0 | |
Net loss and LAE | 0 | 0 | |
Commissions, brokerage and other underwriting expenses | 0 | 0 | |
Underwriting (loss) profit | [1] | 0 | 0 |
Net investment income | 5,000 | 30,400 | |
Change in the fair value of equity securities | 15,200 | 27,400 | |
Net realized capital gains | 0 | 1,500 | |
Change in allowance for credit losses on available for sale securities | 0 | 100 | |
Product and service revenues | 19,800 | 100 | |
Other operating expenses | 1,900 | 300 | |
Corporate administration | 10,700 | 10,100 | |
Amortization of intangible assets | 0 | 0 | |
Interest expense | 19,700 | 13,100 | |
Earnings before income taxes | $ 7,700 | $ 36,000 | |
[1] | Underwriting profit represents net premiums earned less net loss and LAE and commissions, brokerage and other underwriting expenses, all as determined in accordance with GAAP, and does not include net investment income, change in the fair value of equity securities, net realized capital gains, change in allowance for credit losses on available for sale securities, product and service revenues, other operating expenses, corporate administration, amortization of intangible assets or interest expense. Underwriting profit does not replace earnings before income taxes determined in accordance with GAAP as a measure of profitability. Rather, Alleghany believes that underwriting profit enhances the understanding of its reinsurance and insurance segments’ operating results by highlighting net earnings attributable to their underwriting performance. Earnings before income taxes (a GAAP measure) may show a profit despite an underlying underwriting loss. Where underwriting losses persist over extended periods, a reinsurance or an insurance company’s ability to continue as an ongoing concern may be at risk. Therefore, Alleghany views underwriting profit as an important measure in the overall evaluation of performance. | ||
[2] | Primarily consists of the following reinsurance lines of business: directors’ and officers’ liability; errors and omissions liability; general liability; medical malpractice; ocean marine and aviation; auto liability; accident and health; mortgage reinsurance; surety; and credit. |
Summary of Identifiable Assets
Summary of Identifiable Assets and Equity (Detail) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Segment Reporting Information [Line Items] | ||||
Identifiable Assets | $ 31,894,427 | $ 32,268,675 | ||
Invested Assets and Cash | 22,294,800 | |||
Equity Attributable to Alleghany | 8,595,373 | $ 9,186,882 | $ 8,695,881 | $ 8,755,720 |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Identifiable Assets | 30,511,000 | |||
Invested Assets and Cash | 20,871,800 | |||
Equity Attributable to Alleghany | 8,927,800 | |||
Operating Segments | Reinsurance Segment | ||||
Segment Reporting Information [Line Items] | ||||
Identifiable Assets | 18,771,400 | |||
Invested Assets and Cash | 14,734,900 | |||
Equity Attributable to Alleghany | 4,892,400 | |||
Operating Segments | Insurance Segment | ||||
Segment Reporting Information [Line Items] | ||||
Identifiable Assets | 8,320,400 | |||
Invested Assets and Cash | 5,967,300 | |||
Equity Attributable to Alleghany | 2,677,800 | |||
Operating Segments | Reinsurance Segment and Insurance Segment | ||||
Segment Reporting Information [Line Items] | ||||
Identifiable Assets | 27,091,800 | |||
Invested Assets and Cash | 20,702,200 | |||
Equity Attributable to Alleghany | 7,570,200 | |||
Operating Segments | Alleghany Capital Corporation Segment | ||||
Segment Reporting Information [Line Items] | ||||
Identifiable Assets | 3,419,200 | |||
Invested Assets and Cash | 169,600 | |||
Equity Attributable to Alleghany | 1,357,600 | |||
Corporate activities | ||||
Segment Reporting Information [Line Items] | ||||
Identifiable Assets | 1,383,400 | |||
Invested Assets and Cash | 1,423,000 | |||
Equity Attributable to Alleghany | $ (332,400) |
Summary of Alleghany Capital Pr
Summary of Alleghany Capital Product and Service Revenues (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | ||
Other Revenues [Line Items] | |||
Product and service revenues | $ 1,149,162 | $ 767,835 | |
Operating Segments | |||
Other Revenues [Line Items] | |||
Product and service revenues | 1,129,400 | 767,700 | |
Operating Segments | Alleghany Capital Corporation Segment | |||
Other Revenues [Line Items] | |||
Product and service revenues | 1,121,400 | 759,100 | |
Operating Segments | Alleghany Capital Corporation Segment | Industrial Segment | |||
Other Revenues [Line Items] | |||
Product and service revenues | [1] | 461,600 | 404,400 |
Operating Segments | Alleghany Capital Corporation Segment | Non-industrial Segment | |||
Other Revenues [Line Items] | |||
Product and service revenues | [2] | 659,800 | 354,700 |
Operating Segments | Alleghany Capital Corporation Segment | Corporate & Other | |||
Other Revenues [Line Items] | |||
Product and service revenues | $ 0 | $ 0 | |
[1] | For the three months ended March 31, 2022 and 2021, the vast majority of industrial product and service revenues were recognized as goods and services transferred to customers over time. | ||
[2] | For the three months ended March 31, 2022 and 2021, approximat ely 59 percent a nd 63 percent, respectively, of consumer & services product and service revenues were recognized as services transferred to customers over time, with the remainder recognized as goods transferred at a point in time. |
Summary of Alleghany Capital _2
Summary of Alleghany Capital Product and Service Revenues (Parenthetical) (Detail) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Operating Segments | Alleghany Capital Corporation Segment | Non-Industrial Segment | Transferred over Time [Member] | ||
Other Revenues [Line Items] | ||
Product and service revenue percentage | 59.00% | 63.00% |