Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 15, 2017 | Jun. 30, 2016 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | Y | ||
Entity Registrant Name | ALLEGHANY CORP /DE | ||
Entity Central Index Key | 775,368 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 15,412,743 | ||
Entity Public Float | $ 8,156,404,713 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | ||
Available-for-sale securities at fair value: | ||||
Equity securities (cost: 2016 - $2,816,572; 2015 - $2,740,984) | $ 3,109,523 | $ 3,005,908 | ||
Debt securities (amortized cost: 2016 - $12,927,103; 2015 - $13,529,923) | 12,983,213 | 13,605,963 | ||
Short-term investments | 778,410 | 365,810 | ||
Marketable Securities, Total | 16,871,146 | 16,977,681 | ||
Other invested assets | 645,245 | 676,811 | ||
Total investments | 18,111,269 | 17,832,439 | ||
Cash | 594,091 | 475,267 | ||
Accrued investment income | 113,763 | 115,313 | ||
Premium balances receivable | 743,692 | 752,103 | ||
Reinsurance recoverables | 1,272,219 | 1,249,948 | ||
Ceded unearned premiums | 201,023 | 190,368 | ||
Deferred acquisition costs | 448,634 | 419,448 | ||
Property and equipment at cost, net of accumulated depreciation and amortization | 112,920 | 101,306 | ||
Goodwill | [1] | 284,974 | 141,015 | |
Intangible assets, net of amortization | [1] | 378,680 | 212,790 | |
Current taxes receivable | 25,950 | 12,129 | ||
Net deferred tax assets | 354,852 | 468,440 | ||
Funds held under reinsurance agreements | 591,602 | 234,549 | ||
Other assets | 522,922 | 633,964 | ||
Total assets | 23,756,591 | 22,839,079 | ||
Liabilities, Redeemable Noncontrolling Interests and Stockholders' Equity | ||||
Loss and loss adjustment expenses | 11,087,199 | [2] | 10,799,242 | |
Unearned premiums | 2,175,498 | 2,076,061 | ||
Senior Notes and other debt | 1,476,489 | 1,419,363 | ||
Reinsurance payable | 90,659 | 69,297 | ||
Other liabilities | 912,081 | 894,690 | ||
Total liabilities | 15,741,926 | 15,258,653 | ||
Redeemable noncontrolling interests | 74,720 | 25,719 | ||
Common stock (shares authorized: 2016 and 2015 - 22,000,000; shares issued: 2016 and 2015 - 17,459,961) | 17,460 | 17,460 | ||
Contributed capital | 3,611,993 | 3,611,631 | ||
Accumulated other comprehensive income | 109,284 | 116,273 | ||
Treasury stock, at cost (2016 - 2,049,797 shares; 2015 - 1,915,884 shares) | (812,840) | (747,784) | ||
Retained earnings | 5,014,048 | 4,557,127 | ||
Total stockholders' equity attributable to Alleghany stockholders | 7,939,945 | 7,554,707 | ||
Total liabilities, redeemable noncontrolling interest and stockholders' equity | 23,756,591 | 22,839,079 | ||
Commercial Mortgage Loan Portfolio | ||||
Available-for-sale securities at fair value: | ||||
Commercial mortgage loans | $ 594,878 | $ 177,947 | ||
[1] | Goodwill and intangible assets have been reduced by amounts written-down in prior periods. | |||
[2] | Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Equity securities, cost | $ 2,816,572 | $ 2,740,984 |
Debt securities, amortized cost | $ 12,927,103 | $ 13,529,923 |
Common stock,Shares authorized | 22,000,000 | 22,000,000 |
Common stock,Shares issued | 17,459,961 | 17,459,961 |
Treasury stock, shares | 2,049,797 | 1,915,884 |
Consolidated Statements of Earn
Consolidated Statements of Earnings and Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Revenues | ||||
Net premiums earned | $ 4,975,777 | $ 4,230,286 | $ 4,410,647 | |
Net investment income | 438,455 | 438,817 | 459,876 | |
Net realized capital gains | 63,205 | 213,897 | 247,058 | |
Other than temporary impairment losses | (45,165) | (133,868) | (36,294) | |
Other revenue | 698,747 | 250,346 | 150,522 | |
Total revenues | 6,131,019 | 4,999,478 | 5,231,809 | |
Costs and Expenses | ||||
Net loss and loss adjustment expenses | 2,917,166 | 2,339,790 | 2,494,565 | |
Commissions, brokerage and other underwriting expenses | [1] | 1,657,251 | 1,423,889 | 1,421,306 |
Other operating expenses | 765,226 | 342,361 | 252,673 | |
Corporate administration | 42,960 | 46,503 | 47,054 | |
Amortization of intangible assets | 19,012 | (2,211) | (5,750) | |
Interest expense | 81,599 | 91,778 | 90,052 | |
Total costs and expenses | 5,483,214 | 4,242,110 | 4,299,900 | |
Earnings (losses) before income taxes | 647,805 | 757,368 | 931,909 | |
Income taxes | 187,141 | 195,173 | 251,777 | |
Net earnings | 460,664 | 562,195 | 680,132 | |
Net earnings attributable to noncontrolling interest | 3,743 | 1,880 | 893 | |
Net earnings attributable to Alleghany stockholders | 456,921 | 560,315 | 679,239 | |
Net earnings | 460,664 | 562,195 | 680,132 | |
Other comprehensive income: | ||||
Change in unrealized gains (losses), net of deferred taxes of $36,468, ($83,332) and $193,881 for 2016, 2015 and 2014, respectively | 67,726 | (154,759) | 360,065 | |
Less: reclassification for net realized capital gains and other than temporary impairment losses, net of taxes of ($36,281), ($37,044) and ($77,042) for 2016, 2015 and 2014, respectively | (67,380) | (68,796) | (143,077) | |
Change in unrealized currency translation adjustment, net of deferred taxes of ($3,889), ($7,940) and ($21,464) for 2016, 2015 and 2014, respectively | (7,223) | (14,746) | (39,861) | |
Retirement plans | (112) | 990 | (10,473) | |
Comprehensive income (loss) | 453,675 | 324,884 | 846,786 | |
Comprehensive income attributable to noncontrolling interest | 3,743 | 1,880 | 893 | |
Comprehensive income attributable to Alleghany stockholders | $ 449,932 | $ 323,004 | $ 845,893 | |
Basic earnings per share attributable to Alleghany stockholders | $ 29.60 | $ 35.14 | $ 41.40 | |
Diluted earnings per share attributable to Alleghany stockholders | $ 29.59 | $ 35.13 | $ 41.40 | |
[1] | Includes amortization associated with deferred acquisition costs of $1,253.2 million, $1,024.5 million and $1,042.0 million for the years ended December 31, 2016, 2015 and 2014, respectively. |
Consolidated Statements of Ear5
Consolidated Statements of Earnings and Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Change in unrealized gains (losses), deferred taxes | $ 36,468 | $ (83,332) | $ 193,881 |
Reclassification for net realized capital gains and other than temporary impairment losses, taxes | (36,281) | (37,044) | (77,042) |
Change in unrealized currency translation adjustment, deferred taxes | $ (3,889) | $ (7,940) | $ (21,464) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Contributed Capital | Accumulated Other Comprehensive Income | Treasury Stock | Retained Earnings |
Beginning Balance at Dec. 31, 2013 | $ 6,923,757 | $ 17,460 | $ 3,613,151 | $ 186,930 | $ (213,911) | $ 3,320,127 |
Net earnings | 679,239 | 679,239 | ||||
Other comprehensive income (loss), net of tax: | ||||||
Retirement plans | (10,473) | (10,473) | ||||
Change in unrealized appreciation of investments, net | 216,988 | 216,988 | ||||
Change in unrealized currency translation adjustment, net | (39,861) | (39,861) | ||||
Comprehensive income attributable to Alleghany stockholders | 845,893 | 166,654 | 679,239 | |||
Dividends paid | 0 | 0 | 0 | 0 | 0 | 0 |
Treasury stock repurchase | (300,478) | (300,478) | ||||
Other, net | 4,256 | (2,434) | 6,690 | |||
Ending Balance at Dec. 31, 2014 | 7,473,428 | 17,460 | 3,610,717 | 353,584 | (507,699) | 3,999,366 |
Redeemable noncontrolling interests balance at Dec. 31, 2013 | 23,764 | |||||
Other comprehensive income (loss), net of tax: | ||||||
Net earnings attributable to redeemable noncontrolling interest | 893 | |||||
Comprehensive income attributable to noncontrolling interest | 893 | |||||
Other net changes to redeemable noncontrolling interest | (16,041) | |||||
Redeemable noncontrolling interests balance at Dec. 31, 2014 | 8,616 | |||||
Net earnings | 560,315 | 560,315 | ||||
Other comprehensive income (loss), net of tax: | ||||||
Retirement plans | 990 | 990 | ||||
Change in unrealized appreciation of investments, net | (223,555) | (223,555) | ||||
Change in unrealized currency translation adjustment, net | (14,746) | (14,746) | ||||
Comprehensive income attributable to Alleghany stockholders | 323,004 | (237,311) | 560,315 | |||
Dividends paid | 0 | 0 | 0 | 0 | 0 | 0 |
Treasury stock repurchase | (243,814) | (243,814) | ||||
Other, net | 2,089 | 914 | 3,729 | (2,554) | ||
Ending Balance at Dec. 31, 2015 | 7,554,707 | 17,460 | 3,611,631 | 116,273 | (747,784) | 4,557,127 |
Other comprehensive income (loss), net of tax: | ||||||
Net earnings attributable to redeemable noncontrolling interest | 1,880 | |||||
Comprehensive income attributable to noncontrolling interest | 1,880 | |||||
Other net changes to redeemable noncontrolling interest | 15,223 | |||||
Redeemable noncontrolling interests balance at Dec. 31, 2015 | 25,719 | |||||
Net earnings | 456,921 | 456,921 | ||||
Other comprehensive income (loss), net of tax: | ||||||
Retirement plans | (112) | (112) | ||||
Change in unrealized appreciation of investments, net | 346 | 346 | ||||
Change in unrealized currency translation adjustment, net | (7,223) | (7,223) | ||||
Comprehensive income attributable to Alleghany stockholders | 449,932 | (6,989) | 456,921 | |||
Dividends paid | 0 | 0 | 0 | 0 | 0 | 0 |
Treasury stock repurchase | (68,320) | (68,320) | ||||
Other, net | 3,626 | 362 | 3,264 | |||
Ending Balance at Dec. 31, 2016 | 7,939,945 | $ 17,460 | $ 3,611,993 | $ 109,284 | $ (812,840) | $ 5,014,048 |
Other comprehensive income (loss), net of tax: | ||||||
Net earnings attributable to redeemable noncontrolling interest | 3,743 | |||||
Comprehensive income attributable to noncontrolling interest | 3,743 | |||||
Other net changes to redeemable noncontrolling interest | 45,258 | |||||
Redeemable noncontrolling interests balance at Dec. 31, 2016 | $ 74,720 |
Consolidated Statements of Cha7
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - shares | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Common stock, shares issued | 17,459,961 | 17,459,961 | 17,459,961 | 17,459,961 |
Treasury stock, shares | 2,049,797 | 1,915,884 | 1,405,638 | 693,769 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities | |||
Net earnings | $ 460,664 | $ 562,195 | $ 680,132 |
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 160,469 | 163,062 | 178,949 |
Net realized capital (gains) losses | (63,205) | (213,897) | (247,058) |
Other than temporary impairment losses | 45,165 | 133,868 | 36,294 |
(Increase) decrease in reinsurance recoverables, net of reinsurance payable | (909) | 101,332 | (8,838) |
(Increase) decrease in premium balances receivable | 8,411 | (68,255) | (8,593) |
(Increase) decrease in ceded unearned premiums | (10,655) | (5,933) | (11,287) |
(Increase) decrease in deferred acquisition costs | (29,186) | (66,279) | (18,429) |
(Increase) decrease in funds held under reinsurance agreements | (357,053) | (104,442) | 25,948 |
Increase (decrease) in unearned premiums | 99,437 | 241,877 | 68,634 |
Increase (decrease) in loss and loss adjustment expenses | 287,957 | (797,974) | (355,325) |
Change in unrealized foreign exchange losses (gains) | 155,230 | 172,006 | 172,856 |
Other, net | 36,602 | 208,418 | (140,504) |
Net adjustments | 332,263 | (236,217) | (307,353) |
Net cash provided by (used in) operating activities | 792,927 | 325,978 | 372,779 |
Cash flows from investing activities | |||
Purchases of debt securities | (5,960,516) | (7,474,017) | (6,783,116) |
Purchases of equity securities | (2,093,644) | (3,496,203) | (1,521,201) |
Sales of debt securities | 4,895,282 | 6,377,573 | 5,558,948 |
Maturities and redemptions of debt securities | 1,512,879 | 1,653,606 | 1,437,988 |
Sales of equity securities | 2,067,095 | 3,172,826 | 1,043,181 |
Net (purchases) sales of short-term investments | (442,784) | 326,765 | 624,209 |
Net (purchases) sales and maturities of commercial mortgage loans | (416,931) | (177,947) | |
Purchases of property and equipment | (24,005) | (27,258) | (43,681) |
Purchases of subsidiaries, net of cash acquired | (180,242) | (156,867) | (8,203) |
Other, net | (29,861) | (26,820) | (257,090) |
Net cash provided by (used in) investing activities | (672,727) | 171,658 | 51,035 |
Cash flows from financing activities | |||
Proceeds from issuance of senior notes | 297,942 | ||
Debt issue costs paid | (3,625) | ||
Treasury stock acquisitions | (68,320) | (243,814) | (300,478) |
Repayment of Senior Notes | (367,002) | (318,588) | |
Other, net | 50,906 | 2,033 | 22,674 |
Net cash provided by (used in) financing activities | (17,414) | (608,783) | (302,075) |
Effect of exchange rate changes on cash | 16,038 | (18,845) | (14,795) |
Net increase (decrease) in cash | 118,824 | (129,992) | 106,944 |
Cash at beginning of period | 475,267 | 605,259 | 498,315 |
Cash at end of period | 594,091 | 475,267 | 605,259 |
Cash paid during period for: | |||
Interest paid | 80,817 | 102,146 | 100,977 |
Income taxes paid (refund received) | $ 83,023 | $ 59,699 | $ 335,050 |
Summary of Significant Accounti
Summary of Significant Accounting Principles | 12 Months Ended |
Dec. 31, 2016 | |
Summary of Significant Accounting Principles | 1. Summary of Significant Accounting Principles (a) Principles of Financial Statement Presentation Alleghany Corporation (“Alleghany”), a Delaware corporation owns and manages certain operating subsidiaries and investments, anchored by a core position in property and casualty reinsurance and insurance. Through its wholly-owned subsidiary Alleghany Insurance Holdings LLC (“AIHL”) and its subsidiaries, Alleghany is engaged in the property and casualty insurance business. AIHL’s insurance operations are principally conducted by its subsidiaries RSUI Group, Inc. (“RSUI”), CapSpecialty, Inc. (“CapSpecialty”) and Pacific Compensation Corporation (“PacificComp”). CapSpecialty has been a subsidiary of AIHL since January 2002, RSUI has been a subsidiary of AIHL since July 2003 and PacificComp has been a subsidiary of AIHL since July 2007. AIHL Re LLC (“AIHL Re”), a captive reinsurance company which provides reinsurance to Alleghany’s insurance operating subsidiaries and affiliates, has been a wholly-owned subsidiary of Alleghany since its formation in May 2006. Alleghany’s reinsurance operations commenced on March 6, 2012 when Alleghany consummated a merger with Transatlantic Holdings, Inc. (“TransRe”) and TransRe became one of Alleghany’s wholly-owned subsidiaries. Although Alleghany’s primary sources of revenues and earnings are its reinsurance and insurance operations and investments, Alleghany also sources, executes, manages and monitors certain private capital investments primarily through its wholly-owned subsidiary Alleghany Capital Corporation (“Alleghany Capital”). Alleghany Capital’s investments are included in other activities for segment reporting purposes and include: • Stranded Oil Resources Corporation (“SORC”), an exploration and production company focused on enhanced oil recovery, headquartered in Golden, Colorado; • Bourn & Koch, Inc. (“Bourn & Koch”), a manufacturer and remanufacturer/retrofitter of precision machine tools and supplier of replacement parts, headquartered in Rockford, Illinois; • 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 • Jazwares, LLC (together with its affiliates, “Jazwares”), a toy and consumer electronics company, headquartered in Sunrise, Florida. The results of IPS have been included in Alleghany’s consolidated results beginning with its acquisition by Alleghany Capital on October 31, 2015. On April 15, 2016, Alleghany Capital acquired an additional 50 percent of Jazwares’ outstanding equity, bringing its equity ownership interest to 80 percent and, as of that date, the results of Jazwares have been included in Alleghany’s consolidated results. Prior to April 15, 2016, Jazwares was accounted for under the equity method of accounting. In addition, Alleghany owns and manages properties in the Sacramento, California region through its wholly-owned subsidiary Alleghany Properties Holdings LLC (“Alleghany Properties”). Alleghany owned an approximately 15 percent equity interest in ORX Exploration, Inc. (“ORX”), a regional oil and gas exploration and production company, until it was sold on December 23, 2016. Alleghany’s public equity investments are managed primarily through Alleghany’s wholly-owned subsidiary Roundwood Asset Management LLC. 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 accumulated other 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 interest. Because all noncontrolling interests have the option to sell their ownership interests to Alleghany in the future (generally through 2023), the portion of stockholders’ equity that is not attributable to Alleghany stockholders is presented on the Consolidated Balance Sheets as redeemable noncontrolling interest for all periods presented. During 2016 and 2015, Bourn & Koch had approximately 11 percent and 12 percent, respectively, noncontrolling interests outstanding, Kentucky Trailer had approximately 20 percent noncontrolling interests outstanding, IPS had approximately 16 percent noncontrolling interests outstanding beginning October 31, 2015 and Jazwares had approximately 20 percent noncontrolling interests outstanding beginning April 15, 2016. 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 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 statement of earnings and comprehensive income in the period in which the changes are made. (b) Investments Investments consist of debt securities, equity securities, short-term investments, commercial mortgage loans and other invested assets. Alleghany considers all of its marketable equity securities, debt securities and short-term investments as available-for-sale AFS securities are recorded at fair value. Unrealized gains and losses during the year, net of the related tax effect, applicable to AFS securities, as well as partnership investments that Alleghany accounts for as AFS, are excluded from earnings and reflected in comprehensive income, and the cumulative effect is reported as a separate component of stockholders’ equity until realized. If a decline in fair value is deemed to be other than temporary, the investment is written down to its fair value and the amount of the write-down is recorded as an other than temporary impairment (“OTTI”) loss on the statement of earnings. In addition, any portion of such decline related to debt securities that is believed to arise from factors other than credit is recorded as a component of other comprehensive income rather than against earnings. Commercial mortgage loans are carried at unpaid principal balance, less allowance for loan losses. The allowance for loan losses is a valuation allowance for incurred credit losses when management believes the uncollectibility of a loan balance is probable. Subsequent recoveries, if any, are credited to the allowance. Interest income on loans is accrued as earned. Other invested assets include invested assets not identified above, primarily related to: (i) equity investments in operating companies where Alleghany has significant influence (an aggregate common stock position held at or above 20 percent is presumed to convey significant influence); (ii) partnership investments (including hedge funds and private equity funds); and (iii) non-marketable Non-marketable Net realized gains and losses on investments are determined in accordance with the specific identification method. Net investment income consists primarily of: (i) interest income from debt securities, short-term investments, commercial mortgage loans, funds withheld by cedants and cash, including any premium amortization or discount accretion; (ii) dividend income from equity securities; and (iii) investment income from other invested assets, which generally includes distributions when receivable and earnings from investments accounted for under the equity method; less expenses related to investments. Interest income is accrued when earned. Premiums and discounts arising from the purchase of certain debt securities are treated as a yield adjustment over the estimated useful life of the securities, adjusted for anticipated prepayments using the retrospective interest method. Under this method, the effective yield on a security is estimated. Such estimates are based on the prepayment terms of the security, past actual cash flows, and assumptions as to future expected cash flow. The future expected cash flow assumptions consider various prepayment assumptions based on historical experience, as well as current market conditions. Periodically, the effective yield is re-estimated re-estimation, See Note 4 for additional information regarding investments. (c) Fair value Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between willing, able and knowledgeable market participants at the measurement date. Fair value measurements are not adjusted for transaction costs. In addition, a three-tiered hierarchy for inputs is used in management’s determination of fair value of financial instruments that emphasizes the use of observable inputs over the use of unobservable inputs by requiring that the observable inputs be used when available. Observable inputs are market participant assumptions based on market data obtained from sources independent of the reporting entity. Unobservable inputs are the reporting entity’s own assumptions about market participant assumptions based on the best information available under the circumstances. In assessing the appropriateness of using observable inputs in making its fair value determinations, Alleghany considers whether the market for a particular security is “active” or not based on all the relevant facts and circumstances. A market may be considered to be inactive if there are relatively few recent transactions or if there is a significant decrease in market volume. Furthermore, Alleghany considers whether observable transactions are “orderly” or not. Alleghany does not consider a transaction to be orderly if there is evidence of a forced liquidation or other distressed condition; as such, little or no weight is given to that transaction as an indicator of fair value. Although Alleghany is responsible for the determination of the fair value of its 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, Valuation service providers typically obtain data about market transactions and other key valuation model inputs from multiple sources and, through the use of widely accepted internal valuation models, provide a single fair value measurement for individual securities for which a fair value has been requested under the terms of service agreements. The inputs used by the valuation service providers include, but are not limited to, market prices from recently completed transactions and transactions of comparable securities, interest rate yield curves, credit spreads, currency rates and other market observable information, as applicable. The valuation models take into account, among other things, market observable information as of the measurement date as well as the specific attributes of the security being valued including its term, interest rate, credit rating, industry sector and, when applicable, collateral quality and other issue or issuer specific information. When market transactions or other market observable data is limited, the extent to which judgment is applied in determining fair value is greatly increased. The three-tiered hierarchy used in management’s determination of fair value is broken down into three levels based on the reliability of inputs as follows: • Level 1: Valuations are based on unadjusted quoted prices in active markets that Alleghany has the ability to access for identical, unrestricted assets and do not involve any meaningful degree of judgment. An active market is defined as a market where transactions for the financial instrument occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Alleghany’s Level 1 assets include publicly traded common stocks and mutual funds (which are included on the balance sheet in equity securities) where Alleghany’s valuations are based on quoted market prices. • Level 2: Valuations are based on direct and indirect observable inputs other than quoted market prices included in Level 1. Level 2 inputs include quoted prices for similar assets in active markets and inputs other than quoted prices that are observable for the asset, such as the terms of the security and market-based inputs. Terms of the security include coupon, maturity date and any special provisions that may, for example, enable the investor, at its election, to redeem the security prior to its scheduled maturity date (such provisions may apply to all debt securities except U.S. Government obligations). Market-based inputs include interest rates and yield curves that are observable at commonly quoted intervals and current credit rating(s) of the security. Market-based inputs may also include credit spreads of all debt securities except U.S. Government obligations, and currency rates for certain foreign government obligations and foreign corporate bonds denominated in foreign currencies. Fair values are determined using a market approach that relies on the securities’ relationships to quoted prices for similar assets in active markets, as well as the other inputs described above. In determining the fair values for the vast majority of commercial mortgage-backed securities (“CMBS”) and other asset- backed securities, as well as a small portion of residential mortgage-backed securities (“RMBS”), an income approach is used to corroborate and further support the fair values determined by the market approach. The income approach primarily involves developing a discounted cash flow model using the future projected cash flows of the underlying collateral, and the terms of the security. Level 2 assets generally include short-term investments and most debt securities. Alleghany’s Level 2 liabilities consist of the Senior Notes, as defined in Note 1(n). • Level 3: Valuations are based on techniques that use significant inputs that are unobservable. The valuation of Level 3 assets requires the greatest degree of judgment. These measurements may be made under circumstances in which there is little, if any, market activity for the asset. Alleghany’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment. In making the assessment, Alleghany considers factors specific to the asset. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement is classified is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Assets classified as Level 3 principally include certain RMBS, CMBS, other asset-backed securities (primarily, collateralized loan obligations), U.S. corporate bonds, partnership investments and non-marketable Mortgage-backed and asset-backed securities are initially valued at the transaction price. Subsequently, Alleghany uses widely accepted valuation practices that produce a fair value measurement. The vast majority of fair values are determined using an income approach. The income approach primarily involves developing a discounted cash flow model using the future projected cash flows of the underlying collateral, as well as other inputs described below. A few Level 3 valuations are based entirely on non-binding Since Level 3 valuations are based on techniques that use significant inputs that are unobservable with little or no market activity, the fair values under the market approach for Level 3 securities are less credible than under the income approach; however, the market approach, where feasible, is used to corroborate the fair values determined by the income approach. The market approach primarily relies on the securities’ relationships to quoted transaction prices for similarly structured instruments. To the extent that transaction prices for similarly structured instruments are not available for a particular security, other market approaches are used to corroborate the fair values determined by the income approach, including option adjusted spread analyses. Unobservable inputs, significant to the measurement and valuation of mortgage-backed and asset-backed securities, are generally used in the income approach, and include assumptions about prepayment speed and collateral performance, including default, delinquency and loss severity rates. Significant changes to any one of these inputs, or combination of inputs, could significantly change the fair value measurement for these securities. The impact of prepayment speeds on fair value is dependent on a number of variables including whether the securities were purchased at a premium or discount. A decrease in interest rates generally increases the assumed rate of prepayments, and an increase in interest rates generally decreases the assumed speed of prepayments. Increased prepayments increase the yield on securities purchased at a discount and reduce the yield on securities purchased at a premium. In a decreasing prepayment environment, yields on securities purchased at a discount are reduced but are increased for securities purchased at a premium. Changes in default assumptions on underlying collateral are generally accompanied by directionally similar changes in other collateral performance factors, but generally result in a directionally opposite change in prepayment assumptions. Fair values for partnership and non-marketable non-marketable Level 3 liabilities consist of the debt of Alleghany Capital’s operating subsidiaries. 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. In addition to such procedures, Alleghany reviews the reasonableness of its classification of securities within the three-tiered hierarchy to ensure that the classification is consistent with GAAP. See Note 3 for additional information regarding fair value. (d) Cash Cash includes all deposit balances with a bank that are available for immediate withdrawal, whether interest-bearing or non-interest (e) Premiums and Unearned Premiums Premiums are recognized as revenue on a pro rata basis over the term of an insurance policy. Assumed reinsurance premiums written and earned are based on reports received from ceding companies for pro rata treaty contracts and are generally recorded as written based on contract terms for excess-of-loss Unearned premiums and ceded unearned premiums represent the portion of gross premiums written and ceded premiums written, respectively, relating to the unexpired periods of such coverages. Assumed reinsurance premiums written and earned, along with related costs, for which data has not been reported by the ceding companies, are estimated based on historical patterns and other relevant factors. These estimates may change when actual data for such estimated items becomes available. Premium balances receivable are reported net of an allowance for estimated uncollectible premium amounts. Such allowance is based upon an ongoing review of amounts outstanding, length of collection periods, the creditworthiness of the insured and other relevant factors. Amounts deemed to be uncollectible are written off against the allowance. (f) Reinsurance Ceded Reinsurance is used to mitigate the exposure to losses, manage capacity and protect capital resources. Reinsuring loss exposures does not relieve a ceding entity from its obligations to policyholders and cedants. Reinsurance recoverables (including amounts related to incurred but not yet reported (“IBNR”) claims) and ceded unearned premiums are reported as assets. To minimize exposure to losses from a reinsurer’s inability to pay, the financial condition of such reinsurer is evaluated initially upon placement of the reinsurance and periodically thereafter. In addition to considering the financial condition of a reinsurer, the collectability of the reinsurance recoverables is evaluated (and where appropriate, whether an allowance for estimated uncollectible reinsurance recoverables is to be established) based upon a number of other factors. Such factors include the amounts outstanding, length of collection periods, disputes, any collateral or letters of credit held and other relevant factors. To the extent that an allowance for uncollectible reinsurance recoverable is established, amounts deemed to be uncollectible are written off against the allowance for estimated uncollectible reinsurance recoverables. Alleghany currently has no allowance for uncollectible reinsurance recoverables. Ceded premiums written are recorded in accordance with the applicable terms of the various reinsurance contracts and ceded premiums earned are charged against revenue over the period of the various reinsurance contracts. This also generally applies to reinstatement premiums paid to a reinsurer, which arise when contractually-specified ceded loss triggers have been breached. Ceded commissions reduce commissions, brokerage and other underwriting expenses and ceded losses incurred reduce net loss and loss adjustment expense (“LAE”) incurred over the applicable periods of the various reinsurance contracts with third-party reinsurers. If premiums or commissions are subject to adjustment (for example, retrospectively-rated or experience-rated), the estimated ultimate premium or commission is recognized over the period of the contract. Amounts recoverable from reinsurers are estimated in a manner consistent with the claim liability associated with the reinsured business and consistent with the terms of the underlying reinsurance contract. See Note 5 for additional information on reinsurance ceded and reinsurance recoverables. (g) Deferred Acquisition Costs Acquisition costs related to unearned premiums that vary with, and are directly related to, the production of such premiums are deferred. Furthermore, such deferred costs: (i) represent only incremental, direct costs associated with the successful acquisition of a new or renewal insurance or reinsurance contract; (ii) are essential to the contract transaction; (iii) would not have been incurred had the contract transaction not occurred; and (iv) are related directly to the acquisition activities involving underwriting, policy issuance and processing. Acquisition costs principally relate to commissions. To a lesser extent, acquisition costs can include premium taxes and certain qualifying underwriting expenses. For insurance policies written, acquisition costs are generally incurred directly and include commissions, premium taxes and certain qualifying underwriting expenses. For reinsurance contracts written, acquisition costs are generally incurred through brokerage commissions and indirectly through ceding commissions, which are deferred. Deferred acquisition costs are amortized to expense as the related premiums are earned, generally over a period of one year. Deferred acquisition costs are reviewed at least annually to determine their recoverability from future income, including investment income. If any such costs are determined not to be recoverable they are charged to expense. Anticipated net loss and LAE and estimated remaining costs of servicing the contracts are considered when evaluating recoverability of deferred acquisition costs. (h) Property and Equipment Property and equipment is carried at cost, net of accumulated depreciation and amortization. Depreciation of buildings and equipment is principally calculated using the straight-line method over the estimated useful life of the respective assets. Estimated useful lives for such assets range from three to 20 years. Amortization of leasehold improvements is principally calculated using the straight-line method over the estimated useful life of the leasehold improvement or the life of the lease, whichever is less. Rental expense on operating leases is recorded on a straight-line basis over the term of the lease, regardless of the timing of actual lease payments. (i) Goodwill and Other Intangible Assets Goodwill and other intangible assets, net of amortization, are recorded as a consequence of business acquisitions. Goodwill represents the excess, if any, of the amount paid to acquire subsidiaries and other businesses over the fair value of their net assets as of the date of acquisition. Other intangible assets are recorded at their fair value as of the acquisition date. A significant amount of judgment is needed to determine the fair value as of the date of acquisition of other intangible assets and the net assets acquired in a business acquisition. The determination of the fair value of other intangible assets and net assets often involves the use of valuation models and other estimates, which involve many assumptions and variables and are inherently subjective. Other intangible assets that are not deemed to have an indefinite useful life are amortized over their estimated useful lives. Goodwill and intangible assets that have an indefinite useful life are not subject to amortization. Goodwill and other intangible assets deemed to have an indefinite useful life are tested annually in the fourth quarter of every year for impairment. Goodwill and other intangible assets are also tested whenever events and changes in circumstances suggest that the carrying amount may not be recoverable. A significant amount of judgment is required in performing goodwill and other intangible asset impairment tests. These tests may include estimating the fair value of Alleghany’s operating subsidiaries and other intangible assets. If it is determined that an asset has been impaired, the asset is written down by the amount of the impairment, with a corresponding charge to net earnings. Subsequent reversal of any impairment charge is not permitted. With respect to goodwill, a qualitative assessment is first made to determine whether it is necessary to perform quantitative testing. This initial assessment includes, among other factors, consideration of: (i) past, current and projected future earnings and equity; (ii) recent trends and market conditions; and (iii) valuation metrics involving similar companies that are publicly-traded and acquisitions of similar companies, if available. If this initial qualitative assessment indicates that the fair value of an operating subsidiary may be less than its carrying amount, a second step is taken, involving a comparison between the estimated fair value of the operating subsidiary with its respective carrying amount including goodwill. Under GAAP, fair value refers to the amount for which the entire operating subsidiary may be bought or sold. The methods for estimating the fair value of an operating subsidiary values include asset and liability fair values and other valuation techniques, such as discounted cash flows and multiples of earnings or revenues. All of these methods involve significant estimates and assumptions. If the carrying value exceeds estimated fair value, there is an indication of potential impairment, and a third step is performed to measure the amount of impairment. The third step involves calculating an implied fair value of goodwill by measuring the excess of the estimated fair value of the operating subsidiary over the aggregate estimated fair value of the individual assets less liabilities. If the carrying value of goodwill exceeds the implied fair value of goodwill, an impairment charge is recorded for the excess. See Note 2 for additional information on goodwill and other intangible assets. (j) Income Taxes Alleghany files a consolidated federal income tax return with its subsidiaries. Alleghany’s consolidated federal income tax return includes as part of its taxable income all items of income of non-U.S. A valuation allowance is provided when it is more likely than not that some portion of the deferred tax assets will not be realized. This determination is based upon a review of all available information, both positive and negative, including Alleghany’s earnings history, the timing, character and amount of future earnings potential, the reversal of taxable temporary differences and the tax planning strategies available. See Note 9 for additional information on income taxes. (k) Loss Reserves The reserves for loss and LAE represent management’s best estimate of the ultimate cost of all reported and unreported losses incurred through the balance sheet date. The reserves for loss and LAE include but are not limited to: (i) reports and individual case estimates received from ceding companies with respect to assumed reinsurance business; (ii) the accumulation of individual estimates for claims reported with respect to direct insurance business; (iii) estimates for IBNR claims based on past experience, modified for current trends and industry data; and (iv) estimates of expenses for investigating and settling claims based on past experience. The methods used to determine such estimates and to establish the resulting reserves are continually reviewed and updated. Any adjustments are reflected in current income. Net loss and LAE consist of the estimated ultimate cost of settling claims incurred within the reporting period (net of related reinsurance recoverable), including IBNR claims, plus changes in estimates of prior period losses. The estimation of the liability for unpaid loss and LAE is inherently difficult and subjective, especially in view of changing legal and economic environments that impact loss reserve development and, therefore, quantitative techniques frequently have to be supplemented by subjective considerations and managerial judgment. In addition, trends that have affected development of liabilities in the past may not necessarily occur or affect liability development to the same degree in the future. While the reserving process is difficult for the insurance business, the inherent uncertainties of estimating loss reserves are even greater for the reinsurance business, due primarily to the longer-term nature of most of the business, the diversity of development patterns among different types of reinsurance contracts, the necessary reliance on the ceding companies for information regarding reported claims and differing reserving practices among ceding companies, which may change without notice. TransRe writes a significant amount of non-proportional Each of Alleghany’s reinsurance and insurance subsidiaries establishes reserves on its balance sheet for unpaid loss and LAE related to its property and casualty reinsurance and insurance contracts. As of any ba |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets | 2. Goodwill and Intangible Assets On April 15, 2016, Alleghany Capital acquired an additional 50 percent of Jazwares’ outstanding equity for $162.8 million, bringing its equity ownership interest to 80 percent and, as of that date, the results of Jazwares have been included in Alleghany’s consolidated results. Prior to April 15, 2016, Jazwares was accounted for under the equity method of accounting. The $162.8 million purchase price includes $122.1 million in cash paid on April 18, 2016 and $40.7 million of potential contingent consideration based on future profitability. In connection with the acquisition, $130.0 million, $52.4 million and $89.7 million of goodwill, indefinite-lived intangible assets and finite-lived intangible assets, respectively, were recorded. Indefinite-lived intangible assets relate to trade name and finite-lived intangible assets relate to license agreements, customer relationships and owned content. On October 31, 2015, Alleghany Capital acquired approximately 84 percent of the equity in IPS for $106.3 million, including $89.9 million in cash paid on November 2, 2015, $12.5 million of potential contingent consideration based on future profitability and $3.9 million of estimated purchase price adjustments. In connection with the acquisition, $23.5 million, $27.9 million and $49.3 million of goodwill, indefinite-lived intangible assets and finite-lived intangible assets, respectively, were recorded. Indefinite-lived intangible assets relate to trade name, and finite-lived intangible assets relate to customer relationships, back-log not-to-compete. The amount of goodwill and intangible assets, net of accumulated amortization expense, reported on Alleghany’s consolidated balance sheets as of December 31, 2016 and 2015 were as follows: December 31, 2016 December 31, 2015 Gross Accumulated Net Carrying (1) Gross Accumulated Net Carrying (1) ($ in millions) Insurance Segment (2) $ 49.0 $ - $ 49.0 $ 49.0 $ - $ 49.0 Insurance Segment - Intangible assets: Agency relationships 17.9 9.8 8.1 17.9 9.0 8.9 State insurance licenses 25.8 - 25.8 25.8 - 25.8 Trade name 35.5 - 35.5 35.5 - 35.5 Brokerage and reinsurance relationships 33.8 30.4 3.4 33.8 28.2 5.6 Renewal rights 24.2 24.1 0.1 24.2 24.1 0.1 Other 4.1 4.1 - 4.1 4.1 - Total insurance segment intangibles 141.3 68.4 72.9 141.3 65.4 75.9 Total insurance segment goodwill and $ 190.3 $ 68.4 $ 121.9 $ 190.3 $ 65.4 $ 124.9 Reinsurance Segment (2) Value of business in-force $ 291.4 $ 291.4 $ - $ 291.4 $ 291.4 $ - Loss and LAE reserves (98.8) (72.7) (26.1) (98.8) (65.1) (33.7) State and foreign insurance licenses 19.0 - 19.0 19.0 - 19.0 Trade name 50.0 - 50.0 50.0 - 50.0 Renewal rights 44.0 17.8 26.2 44.0 13.5 30.5 Leases (28.1) (13.8) (14.3) (28.1) (10.9) (17.2) Internally-developed software 10.0 10.0 - 10.0 10.0 - Total reinsurance segment intangibles $ 287.5 $ 232.7 $ 54.8 $ 287.5 $ 238.9 $ 48.6 Other Activities (2)(3) $ 236.0 $ - $ 236.0 $ 92.0 $ - $ 92.0 Other Activities (3) Trade name 126.6 - 126.6 38.9 - 38.9 Licence agreements 66.2 5.9 60.3 - - - Other 84.0 19.9 64.1 53.0 3.6 49.4 Total other activities intangibles 276.8 25.8 251.0 91.9 3.6 88.3 Total other activities goodwill and $ 512.8 $ 25.8 $ 487.0 $ 183.9 $ 3.6 $ 180.3 Alleghany consolidated: Goodwill $ 285.0 $ - $ 285.0 $ 141.0 $ - $ 141.0 Intangible assets 705.6 326.9 378.7 520.7 307.9 212.8 Goodwill and other intangibles assets $ 990.6 $ 326.9 $ 663.7 $ 661.7 $ 307.9 $ 353.8 (1) Goodwill and intangible assets have been reduced by amounts written-down in prior periods. (2) See Note 13 for additional information on Alleghany’s segments of business. (3) Primarily represents goodwill and other intangible assets related to the acquisition of: (i) Jazwares on April 15, 2016; (ii) IPS on October 31, 2015; (iii) Bourn & Koch on April 26, 2012; and (iv) a controlling equity interest in Kentucky Trailer on August 30, 2013. Also reflects minor acquisitions made by Jazwares and Bourn & Koch in 2016 and Kentucky Trailer in 2015 and 2014. Trade names and state and foreign insurance licenses have an indefinite useful life. The economic useful lives of significant intangible assets in the reinsurance and insurance segments are as follows: agency relationships — 15 years; brokerage and reinsurance relationships — 15 years; renewal rights — between five and 14 years; loss and LAE reserves — 15 years; leases — 10 years; and internally developed software — 2.5 years. The economic useful life of license agreements is 8 years. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value of Financial Instruments | 3. Fair Value of Financial Instruments The carrying values and estimated fair values of Alleghany’s consolidated financial instruments as of December 31, 2016 and 2015 were as follows: December 31, 2016 December 31, 2015 Carrying Value Fair Value Carrying Value Fair Value ($ in millions) Assets Investments (excluding equity method investments and loans) (1) $ 16,899.2 $ 16,899.2 $ 17,007.6 $ 17,007.6 Liabilities Senior Notes and other debt (2) $ 1,476.5 $ 1,584.3 $ 1,419.4 $ 1,525.0 (1) This table includes AFS investments (debt and equity securities, as well as partnership and non-marketable (2) See Note 8 for additional information on the Senior Notes and other debt. Alleghany’s financial instruments measured at fair value and the level of the fair value hierarchy of inputs used as of December 31, 2016 and 2015 were as follows: Level 1 Level 2 Level 3 Total ($ in millions) As of December 31, 2016 Equity securities: Common stock $ 3,105.2 $ - $ 4.3 $ 3,109.5 Preferred stock - - - - Total equity securities 3,105.2 - 4.3 3,109.5 Debt securities: U.S. Government obligations - 1,243.3 - 1,243.3 Municipal bonds - 4,185.8 - 4,185.8 Foreign government obligations - 1,047.1 - 1,047.1 U.S. corporate bonds - 2,120.2 72.9 2,193.1 Foreign corporate bonds - 1,088.4 0.4 1,088.8 Mortgage and asset-backed securities: RMBS (1) - 994.5 5.9 1,000.4 CMBS - 730.5 4.3 734.8 Other asset-backed securities (2) - 586.1 903.8 1,489.9 Total debt securities - 11,995.9 987.3 12,983.2 Short-term investments - 778.4 - 778.4 Other invested assets (3) - - 28.1 28.1 Total investments (excluding equity method investments and loans) $ 3,105.2 $ 12,774.3 $ 1,019.7 $ 16,899.2 Senior Notes and other debt $ - $ 1,491.5 $ 92.8 $ 1,584.3 Level 1 Level 2 Level 3 Total ($ in millions) As of December 31, 2015 Equity securities: Common stock $ 3,001.2 $ 4.7 $ - $ 3,005.9 Preferred stock - - - - Total equity securities 3,001.2 4.7 - 3,005.9 Debt securities: U.S. Government obligations - 1,074.7 - 1,074.7 Municipal bonds - 4,339.6 - 4,339.6 Foreign government obligations - 941.4 - 941.4 U.S. corporate bonds - 2,126.9 49.8 2,176.7 Foreign corporate bonds - 1,230.3 - 1,230.3 Mortgage and asset-backed securities: RMBS (1) - 1,238.5 14.9 1,253.4 CMBS - 1,003.2 20.2 1,023.4 Other asset-backed securities (2) - 613.5 953.0 1,566.5 Total debt securities - 12,568.1 1,037.9 13,606.0 Short-term investments - 365.8 - 365.8 Other invested assets (3) - - 29.9 29.9 Total investments (excluding equity method investments and loans) $ 3,001.2 $ 12,938.6 $ 1,067.8 $ 17,007.6 Senior Notes and other debt $ - $ 1,488.7 $ 36.3 $ 1,525.0 (1) Primarily includes government agency pass-through securities guaranteed by a government agency or government sponsored enterprise, among other types of RMBS. (2) Includes $903.8 million and $946.7 million of collateralized loan obligations as of December 31, 2016 and 2015, respectively. (3) Includes partnership and non-marketable In 2016, there were transfers of $20.2 million of securities out of Level 3 that were principally due to an increase in observable inputs related to the valuation of such assets and, specifically, an increase in broker quotes. Of the $20.2 million of transfers, $8.6 million related to U.S. corporate bonds, $5.8 million related to CMBS and $5.8 million related to several other types of securities. In 2016, there were transfers of $10.6 million of securities into Level 3 that were principally due to a decrease in observable inputs related to the valuation of such assets and, specifically, a decrease in broker quotes. Of the $10.6 million of transfers, $7.3 million related to U.S. corporate bonds, $1.9 million related to foreign corporate bonds and $1.4 million related to common stock. There were no other material transfers between Levels 1, 2 or 3 in 2016. In 2015, there were transfers of $22.9 million of securities out of Level 3 that were principally due to an increase in observable inputs related to the valuation of such assets. Of the $22.9 million of transfers, $15.9 million related to U.S. corporate bonds, $5.5 million related to foreign corporate bonds and $1.5 million related to other invested assets. In 2015, there were transfers of $19.9 million of securities into Level 3 that were principally due to a decrease in observable inputs related to the valuation of such assets. Of the $19.9 million of transfers, $14.2 million related to U.S. corporate bonds, $5.0 million related to other invested assets and $0.7 million related to foreign corporate bonds. There were no other transfers between Levels 1, 2 or 3 in 2015. The following tables present reconciliations of the changes during 2016 and 2015 in Level 3 assets measured at fair value: Debt Securities Mortgage and asset-backed Year Ended December 31, 2016 Common U.S. Foreign RMBS CMBS Other Other (1) Total ($ in millions) Balance as of January 1, 2016 $ - $ 49.8 $ - $ 14.9 $ 20.2 $ 953.0 $ 29.9 $ 1,067.8 Net realized/unrealized gains (losses) included in: Net earnings (2) (0.6) (0.3) - 0.3 (0.2) 4.2 4.7 8.1 Other comprehensive income 1.8 0.1 - (0.5) 0.4 27.4 (1.5) 27.7 Purchases 2.2 46.1 0.4 - - 177.0 - 225.7 Sales (0.2) (15.0) (0.2) (7.0) (9.7) (76.8) (4.7) (113.6) Issuances - - - - - - - - Settlements - (6.5) - (1.8) (0.6) (177.5) - (186.4) Transfers into Level 3 1.4 7.3 1.9 - - - - 10.6 Transfers out of Level 3 (0.3) (8.6) (1.7) - (5.8) (3.5) (0.3) (20.2) Balance as of December 31, 2016 $ 4.3 $ 72.9 $ 0.4 $ 5.9 $ 4.3 $ 903.8 $ 28.1 $ 1,019.7 Debt Securities Mortgage and asset-backed Year Ended December 31, 2015 U.S. Foreign RMBS CMBS Other Other (1) Total ($ in millions) Balance as of January 1, 2015 $ 36.7 $ 6.0 $ 18.2 $ 23.3 $ 933.1 $ 24.1 $ 1,041.4 Net realized/unrealized gains (losses) included in: Net earnings (2) (0.6) - 0.6 (0.4) 2.7 1.0 3.3 Other comprehensive income (1.3) 0.8 (1.1) (1.0) (25.9) 0.2 (28.3) Purchases 35.5 - - - 233.3 1.8 270.6 Sales (1.9) (2.0) - - (182.3) (0.7) (186.9) Issuances - - - - - - - Settlements (16.9) - (2.8) (1.7) (7.9) - (29.3) Transfers into Level 3 14.2 0.7 - - - 5.0 19.9 Transfers out of Level 3 (15.9) (5.5) - - - (1.5) (22.9) Balance as of December 31, 2015 $ 49.8 $ - $ 14.9 $ 20.2 $ 953.0 $ 29.9 $ 1,067.8 (1) Includes partnership and non-marketable (2) There were no OTTI losses recorded in net earnings related to Level 3 instruments still held as of December 31, 2016 and 2015. Net unrealized losses related to Level 3 investments as of December 31, 2016 and 2015 were not material. See Note 1(c) for Alleghany’s accounting policy on fair value. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2016 | |
Investments | 4. Investments (a) Unrealized Gains and Losses The amortized cost or cost and the fair value of AFS securities as of December 31, 2016 and 2015 are summarized as follows: Amortized Gross Gross Fair Value ($ in millions) As of December 31, 2016 Equity securities: Common stock $ 2,816.6 $ 332.1 $ (39.2) $ 3,109.5 Preferred stock - - - - Total equity securities 2,816.6 332.1 (39.2) 3,109.5 Debt securities: U.S. Government obligations 1,265.7 2.2 (24.6) 1,243.3 Municipal bonds 4,161.0 66.9 (42.1) 4,185.8 Foreign government obligations 1,030.9 20.2 (4.0) 1,047.1 U.S. corporate bonds 2,168.9 43.5 (19.3) 2,193.1 Foreign corporate bonds 1,068.3 27.3 (6.8) 1,088.8 Mortgage and asset-backed securities: RMBS 1,005.9 7.0 (12.5) 1,000.4 CMBS 728.8 9.6 (3.6) 734.8 Other asset-backed securities (1) 1,497.6 4.0 (11.7) 1,489.9 Total debt securities 12,927.1 180.7 (124.6) 12,983.2 Short-term investments 778.4 - - 778.4 Total investments $ 16,522.1 $ 512.8 $ (163.8) $ 16,871.1 Amortized Gross Gross Fair Value ($ in millions) As of December 31, 2015 Equity securities: Common stock $ 2,741.0 $ 351.9 $ (87.0) $ 3,005.9 Preferred stock - - - - Total equity securities 2,741.0 351.9 (87.0) 3,005.9 Debt securities: U.S. Government obligations 1,086.8 1.9 (14.0) 1,074.7 Municipal bonds 4,213.6 134.8 (8.8) 4,339.6 Foreign government obligations 924.1 18.6 (1.3) 941.4 U.S. corporate bonds 2,201.3 23.4 (48.0) 2,176.7 Foreign corporate bonds 1,219.0 24.0 (12.7) 1,230.3 Mortgage and asset-backed securities: RMBS 1,255.1 10.7 (12.4) 1,253.4 CMBS 1,024.8 8.2 (9.6) 1,023.4 Other asset-backed securities (1) 1,605.2 0.3 (39.0) 1,566.5 Total debt securities 13,529.9 221.9 (145.8) 13,606.0 Short-term investments 365.8 - - 365.8 Total investments $ 16,636.7 $ 573.8 $ (232.8) $ 16,977.7 (1) Includes $903.8 million and $946.7 million of collateralized loan obligations as of December 31, 2016 and 2015, respectively. (b) Contractual Maturity The amortized cost or cost and the estimated fair value of debt securities by contractual maturity as of December 31, 2016 are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Fair Value ($ in millions) Short-term investments due in one year or less $ 778.4 $ 778.4 Mortgage and asset-backed securities (1) 3,232.3 3,225.1 Debt securities with maturity dates: One year or less 428.6 430.8 Over one through five years 3,048.5 3,074.5 Over five through ten years 3,229.1 3,250.7 Over ten years 2,988.6 3,002.1 Total debt securities 12,927.1 12,983.2 Equity securities 2,816.6 3,109.5 Total $ 16,522.1 $ 16,871.1 (1) Mortgage and asset-backed securities by their nature do not generally have single maturity dates. (c) Net Investment Income Net investment income for 2016, 2015 and 2014 was as follows: Year Ended December 31, 2016 2015 2014 ($ in millions) Interest income $ 385.7 $ 376.4 $ 384.4 Dividend income 50.3 54.0 63.0 Investment expenses (26.3) (27.2) (28.8) Equity in results of Pillar Investments (1) 15.8 23.3 22.0 Equity in results of Ares (1) 11.5 6.6 8.6 Equity in results of ORX - (6.3) (3.2) Other investment results 1.5 12.0 13.9 Total $ 438.5 $ 438.8 $ 459.9 (1) See Note 4(h) for discussion of the Pillar Investments and the investment in Ares, each as defined therein. As of December 31, 2016, non-income (d) Realized Gains and Losses The proceeds from sales of AFS securities were $7.0 billion, $9.6 billion and $6.6 billion in 2016, 2015 and 2014, respectively. Realized capital gains and losses in 2016 primarily reflect sales of equity and debt securities. Realized capital gains and losses for 2015 and 2014 generally reflect sales of equity securities. In addition, Alleghany Capital recognized a $98.8 million capital loss due to an impairment charge from a write-down of certain SORC assets in 2016 and a gain of $13.2 million on April 15, 2016 in connection with its acquisition of an additional 50 percent equity ownership in Jazwares, when its pre-existing The SORC assets that were written-down relate specifically to SORC’s acquisition of a certain legacy oil field for the sole purpose of applying enhanced oil recovery techniques. After completing construction of its underground facility in 2014, SORC commenced its drilling program in 2015. The drilling program, however, was delayed by third-party equipment problems that have since been corrected as well as a longer than expected trial-and-error oil-recovery Realized capital gains from equity securities in 2015 include the sales of certain equity securities resulting from a partial restructuring of the equity portfolio, the sales of certain equity securities which had their cost basis reduced in earlier periods for the recognition of OTTI losses, and a $25.8 million capital loss due to an impairment charge related to a write-off The amount of gross realized capital gains and gross realized capital losses in 2016, 2015 and 2014 were as follows: Year Ended December 31, 2016 2015 2014 ($ in millions) Gross realized capital gains $ 344.7 $ 424.2 $ 301.1 Gross realized capital losses (281.5) (210.3) (54.0) Net realized capital gains $ 63.2 $ 213.9 $ 247.1 Gross realized loss amounts exclude OTTI losses, as discussed below. (e) OTTI losses Alleghany holds its equity and debt securities as AFS and, as such, these securities are recorded at fair value. Alleghany continually monitors the difference between cost and the estimated fair value of its equity and debt investments, which involves uncertainty as to whether declines in value are temporary in nature. The analysis of a security’s decline in value is performed in its functional currency. If the decline is deemed temporary, Alleghany records the decline as an unrealized loss in stockholders’ equity. If the decline is deemed to be other than temporary, Alleghany writes its cost-basis or amortized cost-basis down to the fair value of the security and records an OTTI loss on its statement of earnings. In addition, any portion of such decline 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. Management’s assessment of equity securities initially involves an evaluation of all securities that are in an unrealized loss position, regardless of the duration or severity of the loss, as of the applicable balance sheet date. Such initial review consists primarily of assessing whether: (i) there has been a negative credit or news event with respect to the issuer that could indicate the existence of an OTTI; and (ii) Alleghany has the ability and intent to hold an equity security for a period of time sufficient to allow for an anticipated recovery (generally considered to be 12 months from the balance sheet date). To the extent that an equity security in an unrealized loss position is not impaired based on the initial review described above, Alleghany then further evaluates such equity security and deems it to be other than temporarily impaired if it has been in an unrealized loss position for 12 months or more or if its unrealized loss position is greater than 50 percent of its cost, absent compelling evidence to the contrary. Alleghany then evaluates those equity securities where the unrealized loss is at least 20 percent of cost as of the balance sheet date or that have been in an unrealized loss position continuously for six months or more preceding the balance sheet date. This evaluation takes into account quantitative and qualitative factors in determining whether such securities are other than temporarily impaired including: (i) market valuation metrics associated with the equity security (such as dividend yield and price-to-earnings Debt securities in an unrealized loss position are evaluated for OTTI if they meet any of the following criteria: (i) they are trading at a discount of at least 20 percent to amortized cost for an extended period of time (nine consecutive months or more); (ii) there has been a negative credit or news event with respect to the issuer that could indicate the existence of an OTTI; 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 an OTTI 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 an OTTI 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 OTTI loss recognized in earnings is the non-credit 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. OTTI losses in 2016 reflect $45.2 million of unrealized losses that were deemed to be other than temporary and, as such, were required to be charged against earnings. Upon the ultimate disposition of the securities for which OTTI losses have been recorded, a portion of the loss may be recoverable depending on market conditions at the time of disposition. Of the $45.2 million of OTTI losses, $23.3 million related to equity securities, primarily in the retail, financial service, technology, chemical and entertainment sectors, and $21.9 million related to debt securities, primarily in the energy sector. The determination that unrealized losses on equity and debt securities were other than temporary was primarily due to the severity and duration of the decline in the fair value of equity and debt securities relative to their costs. OTTI losses in 2015 reflect $133.9 million of unrealized losses that were deemed to be other than temporary and, as such, were required to be charged against earnings. Of the $133.9 million of OTTI losses, $115.6 million related to equity securities, primarily in the energy, pharmaceutical, gaming and airline sectors, and $18.3 million related to debt securities, primarily in the energy and financial service sectors. The determination that unrealized losses on equity and debt securities were other than temporary was primarily due to the fact that Alleghany lacked the intent to hold the securities for a period of time sufficient to allow for an anticipated recovery and, to a lesser extent, based on the duration of the decline in the fair value of equity securities relative to their costs. OTTI losses in 2014 reflect $36.3 million of unrealized losses that were deemed to be other than temporary and, as such, were required to be charged against earnings. Of the $36.3 million of OTTI losses, $28.7 million relate to equity securities, primarily in the mining sector, and $7.6 million relate to debt securities, primarily in the energy sector. The determination that unrealized losses on such securities were other than temporary was primarily based on the severity of the decline in the fair value of equity securities relative to their cost as of the balance sheet date, and the fact that Alleghany lacked the intent to hold debt securities for a period of time sufficient to allow for an anticipated recovery. After adjusting the cost basis of securities for the recognition of OTTI losses, the remaining gross unrealized investment losses for debt and equity securities as of December 31, 2016 were deemed to be temporary, based on, among other factors: (i) the duration of time and the relative magnitude to which the fair value of these investments had been below cost were not indicative of an OTTI 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 may ultimately record a realized loss after having originally concluded that the decline in value was temporary. Risks and uncertainties are inherent in the methodology. Alleghany’s methodology for assessing other than temporary declines in value 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. (f) Aging of Gross Unrealized Losses As of December 31, 2016 and 2015, gross unrealized losses and related fair values for equity securities and debt securities, grouped by duration of time in a continuous unrealized loss position, were as follows: Less Than 12 Months 12 Months or More Total Fair Value Gross Fair Value Gross Fair Value Gross ($ in millions) As of December 31, 2016 Equity securities: Common stock $ 619.4 $ 39.2 $ - $ - $ 619.4 $ 39.2 Preferred stock - - - - - - Total equity securities 619.4 39.2 - - 619.4 39.2 Debt securities: U.S. Government obligations 975.0 24.6 - - 975.0 24.6 Municipal bonds 1,464.5 39.7 41.6 2.4 1,506.1 42.1 Foreign government obligations 238.3 4.0 - - 238.3 4.0 U.S. corporate bonds 727.9 18.1 52.6 1.2 780.5 19.3 Foreign corporate bonds 331.0 6.6 4.1 0.2 335.1 6.8 Mortgage and asset-backed securities: RMBS 652.0 11.4 43.4 1.1 695.4 12.5 CMBS 148.9 1.4 117.7 2.2 266.6 3.6 Other asset-backed securities 334.7 1.6 550.4 10.1 885.1 11.7 Total debt securities 4,872.3 107.4 809.8 17.2 5,682.1 124.6 Total temporarily impaired securities $ 5,491.7 $ 146.6 $ 809.8 $ 17.2 $ 6,301.5 $ 163.8 Less Than 12 Months 12 Months or More Total Fair Value Gross Fair Value Gross Fair Value Gross ($ in millions) As of December 31, 2015 Equity securities: Common stock $ 1,355.6 $ 87.0 $ - $ - $ 1,355.6 $ 87.0 Preferred stock - - - - - - Total equity securities 1,355.6 87.0 - - 1,355.6 87.0 Debt securities: U.S. Government obligations 818.4 13.9 7.9 0.1 826.3 14.0 Municipal bonds 276.2 2.4 108.3 6.4 384.5 8.8 Foreign government obligations 208.5 1.3 - - 208.5 1.3 U.S. corporate bonds 1,149.8 39.0 70.0 9.0 1,219.8 48.0 Foreign corporate bonds 479.9 10.8 12.5 1.9 492.4 12.7 Mortgage and asset-backed securities: RMBS 511.1 6.5 250.6 5.9 761.7 12.4 CMBS 593.1 9.4 15.1 0.2 608.2 9.6 Other asset-backed securities 1,164.8 27.2 265.0 11.8 1,429.8 39.0 Total debt securities 5,201.8 110.5 729.4 35.3 5,931.2 145.8 Total temporarily impaired securities $ 6,557.4 $ 197.5 $ 729.4 $ 35.3 $ 7,286.8 $ 232.8 As of December 31, 2016, Alleghany held a total of 1,317 debt securities and equity securities that were in an unrealized loss position, of which 138 securities, all debt securities, were in an unrealized loss position continuously for 12 months or more. The unrealized losses associated with these debt securities consisted primarily of losses related to other asset-backed securities, municipal bonds and CMBS. As of December 31, 2016, the vast majority of Alleghany’s debt securities were rated investment grade, with 5.1 percent of debt securities having issuer credit ratings that were below investment grade or not rated, compared with 3.6 percent as of December 31, 2015. (g) Statutory Deposits Investments with fair values of approximately $1.7 billion as of December 31, 2016, the substantial majority of which were debt securities and equity securities, were deposited with governmental authorities as required by law. (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 invested $175.0 million and AIHL invested $25.0 million 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 December 31, 2016, Alleghany’s carrying value in the Pillar Investments, as determined under the equity method of accounting, was $233.7 million, which is net of returns of capital received from the Pillar Investments. In July 2013, AIHL invested $250.0 million in Ares Management LLC (“Ares”), an asset manager, in exchange for a 6.25 percent equity stake in Ares, with an agreement to engage Ares to manage up to $1.0 billion in certain investment strategies. In May 2014, Ares completed an initial public offering of its common units. Upon completion of the initial public offering, Alleghany’s equity investment in Ares converted to limited partner interests in certain Ares subsidiaries that are convertible into an aggregate 5.9 percent interest in Ares common units. These interests may be converted at any time at Alleghany’s discretion. Until Alleghany determines to convert its limited partner interests into Ares common units, Alleghany classifies its investment in Ares as a component of other invested assets and accounts for its investment using the equity method of accounting. As of December 31, 2016, AIHL’s carrying value in Ares was $224.0 million, which is net of returns of capital received from Ares. (i) Investments in Commercial Mortgage Loans As of December 31, 2016, the carrying value of Alleghany’s commercial loan portfolio was $594.9 million, representing the unpaid principal balance on the loans. As of December 31, 2016, there was no allowance for loan losses. The commercial 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, mature in two to ten years and the principal amounts of the loans were no more than approximately two-thirds |
Reinsurance Ceded
Reinsurance Ceded | 12 Months Ended |
Dec. 31, 2016 | |
Reinsurance Ceded | 5. 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 purchase reinsurance and retrocessional coverages from highly-rated third-party reinsurers. 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. (b) Reinsurance Recoverables Amounts recoverable from reinsurers are recognized in a manner consistent with the claims liabilities associated with the reinsurance placement and presented on the balance sheet as reinsurance recoverables. Such balances as of December 31, 2016 and 2015 consisted of the following: As of December 31, 2016 2015 ($ in millions) Reinsurance recoverables on paid losses $ 36.0 $ 80.6 Ceded outstanding loss and LAE 1,236.2 1,169.3 Total $ 1,272.2 $ 1,249.9 The following table presents information regarding concentration of Alleghany’s reinsurance recoverables and the ratings profile of its reinsurers as of December 31, 2016: Reinsurer (1) Rating (2) Amount Percentage ($ in millions) Swiss Reinsurance Company A+(Superior) $ 172.1 13.5% PartnerRe Ltd A (Excellent) 116.1 9.1% Syndicates at Lloyd’s of London A (Excellent) 105.0 8.3% Chubb Corporation A++(Superior) 91.4 7.2% RenaissanceRe Holdings Ltd A+(Superior) 91.0 7.2% W.R. Berkley Corporation A+(Superior) 89.9 7.1% Allianz SE A+(Superior) 63.5 5.0% Allied World Assurance Company Holdings, AG (3) A (Excellent) 60.5 4.8% Hannover Ruck SE A+(Superior) 46.9 3.7% Fairfax Financial Holdings Ltd (3) A (Excellent) 43.6 3.4% All other reinsurers 392.2 30.7% Total reinsurance recoverables (4) $ 1,272.2 100.0% Secured reinsurance recoverables (5) $ 183.3 14.4% (1) Reinsurance recoverables reflect amounts due from one or more reinsurance subsidiaries of the listed company. (2) Represents the A.M. Best financial strength rating for the applicable reinsurance subsidiary or subsidiaries from which the reinsurance recoverable is due. (3) In December 2016, Fairfax Financial Holdings Ltd announced its agreement to acquire Allied World Assurance Company Holdings, AG. (4) Approximately 94 percent of our reinsurance recoverables balance as of December 31, 2016 was due from reinsurers having an A.M. Best financial strength rating of A (Excellent) or higher. (5) Represents reinsurance recoverables secured by funds held, trust agreements and letters of credit. Alleghany had no allowance for uncollectible reinsurance as of December 31, 2016 and 2015. Reinsured loss and LAE ceded included in Alleghany’s consolidated statements of earnings were $325.8 million, $309.6 million and $250.3 million for 2016, 2015 and 2014, respectively. (c) Premiums Written and Earned The following table presents property and casualty premiums written and earned for 2016, 2015 and 2014: Year Ended December 31, 2016 2015 2014 ($ in millions) Gross premiums written – direct $ 1,490.3 $ 1,505.6 $ 1,529.4 Gross premiums written – assumed 4,276.8 3,616.6 3,567.2 Ceded premiums written (675.3) (633.0) (599.1) Net premiums written $ 5,091.8 $ 4,489.2 $ 4,497.5 Gross premiums earned – direct $ 1,871.1 $ 1,515.9 $ 1,517.0 Gross premiums earned – assumed 3,833.9 3,403.3 3,540.5 Ceded premiums earned (729.2) (688.9) (646.9) Net premiums earned $ 4,975.8 $ 4,230.3 $ 4,410.6 (d) Significant Reinsurance Contracts Alleghany’s reinsurance and insurance subsidiaries reinsure portions of the risks they underwrite or assume with multiple reinsurance programs. A discussion of the more significant programs follows. RSUI reinsures its property lines of business through a program consisting of surplus share treaties, facultative placements, per risk and catastrophe excess of loss treaties. RSUI’s catastrophe reinsurance program and property per risk reinsurance program run on an annual basis from May 1 to the following April 30. RSUI’s catastrophe reinsurance program covers catastrophe risks including, among others, windstorms and earthquakes. As of December 31, 2016, the catastrophe reinsurance program consisted of three layers, with portions of the first and second layers placed on May 1, 2015 and May 1, 2016 and portions of the third layer placed on May 1, 2014 and May 1, 2016. The catastrophe reinsurance program provides coverage for $600.0 million of losses in excess of a $200.0 million net retention after application of surplus share treaties and facultative reinsurance. The first layer provides coverage for $300.0 million of losses, subject to a 5.0 percent co-participation co-participation co-participation In addition, RSUI’s property per risk reinsurance program runs on an annual basis from May 1 to the following April 30 and thus expired on April 30, 2016. On May 1, 2016, the property per risk program was renewed and the new program will expire on April 30, 2017. For the 2016 to 2017 period, RSUI’s property per risk reinsurance program provides coverage for $90.0 million of losses, subject to a 10.0 percent co-participation (e) Significant Intercompany Reinsurance Contracts In the second quarter of 2013, AIHL Re and PacificComp’s wholly-owned subsidiary Pacific Compensation Insurance Company (“PCIC”), entered into an intercompany reinsurance contract, effective January 1, 2013, pursuant to which AIHL Re provides PCIC with coverage for adverse development on net loss and allocated LAE in excess of PCIC’s carried reserves at December 31, 2012 and accident year stop-loss coverage for any net losses and allocated LAE in excess of 75.0 percent of net premiums earned for PCIC for accident years 2013 through 2017. AIHL Re’s commitments also are intended to cover the statutory collateral requirements at PCIC, if and when necessary. AIHL Re’s obligations are subject to an aggregate limit of $100.0 million. In connection with such intercompany reinsurance agreement, Alleghany and AIHL Re entered into a contract whereby Alleghany will guarantee the recoverable balances owed to PCIC from AIHL Re up to $100.0 million. Subsequent to the entry into the above agreements, A.M. Best Company, Inc. upgraded PCIC’s rating to A- In the third quarter of 2015, AIHL Re and CapSpecialty (specifically, the insurance subsidiaries of CapSpecialty) entered into an intercompany reinsurance contract, effective July 1, 2015, pursuant to which AIHL Re provides CapSpecialty with coverage primarily for adverse development on certain net loss and allocated LAE in excess of its carried reserves at June 30, 2015. AIHL Re’s commitments are intended to cover the statutory collateral requirements at CapSpecialty, if and when necessary, and AIHL Re’s obligations are subject to an aggregate limit of $50.0 million. In connection with such intercompany reinsurance agreement, Alleghany and AIHL Re entered into a contract whereby Alleghany will guarantee the recoverable balances owed to CapSpecialty from AIHL Re up to $50.0 million. The above agreements had no impact on Alleghany’s consolidated results of operations and financial condition. |
Liability for Loss and LAE
Liability for Loss and LAE | 12 Months Ended |
Dec. 31, 2016 | |
Liability for Loss and LAE | 6. Liability for Loss and LAE (a) Liability Rollforward Activity in liability for loss and LAE in 2016, 2015 and 2014 is summarized as follows: Year Ended December 31, 2016 2015 2014 ($ in millions) Reserves as of January 1 $ 10,799.2 $ 11,597.2 $ 11,952.5 Less: reinsurance recoverables (1) 1,169.3 1,289.4 1,302.1 Net reserves as of January 1 9,629.9 10,307.8 10,650.4 Other adjustments 2.4 (1.9) 56.9 (2 ) Incurred loss and LAE, net of reinsurance, related to: Current year 3,285.2 2,555.3 2,709.7 Prior years (368.0) (215.5) (215.2) Total incurred loss and LAE, net of reinsurance 2,917.2 2,339.8 2,494.5 Paid loss and LAE, net of reinsurance, related to: (3) Current year 734.3 417.6 520.8 Prior years 1,866.5 2,390.4 2,178.1 Total paid loss and LAE, net of reinsurance 2,600.8 2,808.0 2,698.9 Foreign exchange effect (97.7) (207.8) (195.1) Net reserves as of December 31 9,851.0 9,629.9 10,307.8 Reinsurance recoverables as of December 31 (1) 1,236.2 1,169.3 1,289.4 Reserves as of December 31 $ 11,087.2 $ 10,799.2 $ 11,597.2 (1) Reinsurance recoverables in this table include only ceded loss and LAE reserves. (2) Represents reserves acquired in connection with a loss portfolio transfer transaction. (3) Includes paid losses, net of reinsurance, related to commutations. Gross loss and LAE reserves as of December 31, 2016 increased from December 31, 2015, reflecting increases in the reinsurance and insurance segments. The increase in gross loss and LAE reserves at the reinsurance segment primarily reflects the impact of higher net premiums earned and higher catastrophe losses, partially offset by favorable prior accident year loss reserve development. The increase in gross loss and LAE reserves at the insurance segment primarily reflects higher current accident year losses and higher catastrophe losses, partially offset by favorable prior accident year loss reserve development. Gross loss and LAE reserves as of December 31, 2015 decreased from December 31, 2014, reflecting a decrease in the reinsurance segment loss and LAE reserves, partially offset by an increase in the insurance segment. The decrease in gross loss and LAE reserves in the reinsurance segment primarily reflects favorable prior accident year loss reserve development, loss payments including amounts related to commutations in the fourth quarter of 2015 with certain cedants and the impact of changes in foreign currency exchange rates. The increase in gross loss and LAE reserves in the insurance segment primarily reflects higher current accident year losses. (b) Liability Development The (favorable) unfavorable prior accident year loss reserve development for 2016, 2015 and 2014 is summarized as follows: Year Ended December 31, 2016 2015 2014 ($ in millions) Reinsurance Segment: Property: Catastrophe events $ (14.2) (1) $ (28.0) (2) $ (17.3) (3) Non-catastrophe (91.5) (4) (48.7) (5) (55.8) (6) Total property (105.7) (76.7) (73.1) Casualty & other: Malpractice treaties (7) (10.8) (12.1) (12.7) Commuted A&E Liabilities (8) - 38.2 - Other (177.0) (9) (157.7) (10) (96.6) (11) Total casualty & other (187.8) (131.6) (109.3) Total Reinsurance Segment (293.5) (208.3) (182.4) Insurance Segment: RSUI: Casualty (35.3) (12) (2.9) (13) (30.1) (14) Property and other (33.0) (15) (9.0) (16) (5.3) (17) Total RSUI (68.3) (11.9) (35.4) CapSpecialty: Ongoing lines of business (0.3) 11.0 ( 18) 0.2 Terminated Program (19) (1.9) (6.3) - Asbestos-related illness and environmental impairment liability (2.0) - - Total CapSpecialty (4.2) 4.7 0.2 PacificComp (2.0) (20) - 2.4 ( 21) Total incurred related to prior years $ (368.0) $ (215.5) $ (215.2) (1) Reflects favorable prior accident year loss reserve development from several catastrophes that occurred in the 2010 through 2015 accident years. (2) Includes favorable prior accident year loss reserve development of ($27.7) million from Super Storm Sandy in 2012 and various smaller amounts on catastrophes that occurred in the 2010, 2011, 2013 and 2014 accident years, partially offset by unfavorable prior accident year development from the New Zealand earthquake in 2010. (3) Includes favorable prior accident year loss reserve development of ($1.6) million from Super Storm Sandy in 2012 and ($15.7) million of net favorable prior accident year loss reserve development from other catastrophes. The ($15.7) million primarily reflects favorable prior accident year loss reserve development from several catastrophes that occurred primarily in the 2011 and 2013 accident years, partially offset by unfavorable prior accident year loss reserve development from the New Zealand earthquake in 2010. (4) Reflects favorable prior accident year loss reserve development primarily related to the 2011 and 2015 accident years. (5) Reflects favorable prior accident year loss reserve development primarily related to the 2013 and 2014 accident years. (6) Reflects favorable prior accident year loss reserve development primarily related to the 2012 accident year and, to a lesser extent, the 2011 accident year. (7) Represents certain medical malpractice treaties pursuant to which the increased underwriting profits created by the favorable prior accident year loss reserve development are largely retained by the cedants. As a result, the favorable prior accident year development is largely offset by an increase in profit commission expense incurred when such favorable prior accident year loss reserve development occurs. (8) Represents unfavorable prior accident year loss reserve development related to a commutation and release agreement entered into on November 30, 2015 by TransRe with AIG Property Casualty, Inc., National Indemnity Company and Resolute Management, Inc. with respect to certain reinsurance contracts (the “Commutation Agreement”), including contracts covering asbestos-related illness and environmental impairment liabilities for 1986 and prior years (the “Commuted A&E Liabilities”). (9) Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2003 through 2015 accident years. (10) Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2005 through 2014 accident years, including ($30.7) million of favorable prior accident year development related to French medical malpractice loss reserves commuted in the fourth quarter of 2015 with a European cedant, partially offset by unfavorable prior accident year development from the 2004 and prior accident years. (11) Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2003 through 2007 and 2010 through 2011 accident years, partially offset by unfavorable prior accident year loss reserve development from the 2013 accident year and the 2002 and prior accident years. (12) Primarily reflects favorable prior accident year loss reserve development in the umbrella/excess, general liability and professional liability lines of business related to the 2006 through 2012 accident years. (13) Primarily reflects favorable prior accident year loss reserve development in the umbrella/excess, general liability and professional liability lines of business related to the 2006 through 2011 accident years, partially offset by unfavorable prior accident year loss reserve development in the directors’ and officers’ liability lines of business related to the 2011 through 2014 accident years. (14) Primarily reflects favorable prior accident year loss reserve development in the professional liability, general liability and umbrella/excess lines of business, and primarily related to the 2006 through 2010 accident years, partially offset by unfavorable prior accident year loss reserve development in the directors’ and officers’ liability lines of business in the 2011 and 2012 accident years. (15) Includes favorable prior accident year loss reserve development of ($20.6) million from Super Storm Sandy in 2012 and various other smaller amounts primarily from the non-catastrophe property lines of business in recent accident years. (16) Primarily reflects favorable prior accident year development of ($4.1) million from Super Storm Sandy in 2012, net of reinsurance, and favorable prior accident year loss reserve development related to unallocated LAE reserves. (17) Primarily reflects favorable prior accident year development on unallocated LAE reserves and prior year catastrophe loss reserves from recent accident years. (18) Primarily reflects unfavorable prior accident year loss reserve development related to the casualty lines of business from the 2011 through 2013 accident years. (19) Represents certain specialty lines of business written through a program administrator in connection with a terminated program related to the 2010 and 2009 accident years and reflects (favorable) loss emergence compared with loss emergence patterns assumed in earlier periods for such business. (20) Primarily reflects favorable prior accident year loss reserve development related to 2012 and prior accident years. (21) Primarily reflects unfavorable prior accident year loss reserve development related to 2009 and prior accident years. (c) Supplementary Information on Incurred and Paid Loss and LAE Development The following is supplemental information about incurred and paid loss and LAE development, net of reinsurance. Information is also included for the portion of unpaid loss and LAE, net of reinsurance recoverables, that relate to IBNR and, for the insurance segment, the cumulative number of reported insurance claims. Reinsurance Segment - Property Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 IBNR ($ in millions) 2007 $ 508.3 $ 437.5 $ 426.4 $ 423.8 $ 420.9 $ 419.6 $ 418.4 $ 416.7 $ 415.8 $ 415.3 $ - 2008 645.0 508.0 510.9 515.9 511.9 510.9 509.4 508.7 508.8 - 2009 489.3 377.4 359.7 358.0 357.1 357.6 355.9 353.7 - 2010 615.6 527.1 528.0 540.4 581.2 606.0 609.9 25.4 2011 1,351.2 1,342.3 1,269.4 1,240.7 1,235.2 1,217.1 9.6 2012 697.2 579.1 530.3 495.6 478.1 21.3 2013 501.2 470.6 444.6 422.1 21.1 2014 496.4 464.8 451.3 37.4 2015 368.8 332.0 59.7 2016 684.1 262.2 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 5,472.4 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 ($ in millions) 2007 $ 128.4 $ 306.2 $ 362.8 $ 393.8 $ 402.7 $ 407.5 $ 409.8 $ 410.0 $ 411.0 $ 411.0 2008 163.3 350.8 435.2 477.1 495.0 501.5 503.1 505.0 505.6 2009 114.7 251.7 310.9 332.4 340.6 345.5 347.9 345.7 2010 169.3 349.0 418.9 472.3 513.5 540.1 563.7 2011 407.8 796.4 1,014.3 1,129.2 1,171.0 1,187.2 2012 90.3 268.9 377.8 416.7 438.0 2013 113.1 277.4 361.0 389.8 2014 109.4 297.6 360.0 2015 96.0 217.7 2016 210.5 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 4,629.2 Total incurred loss and LAE for the 2007 through 2016 accident years $ 5,472.4 Cumulative paid loss and LAE for the 2007 through 2016 accident years 4,629.2 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 2.8 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 846.0 Reinsurance Segment - Casualty & Other Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of Accident Year 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 IBNR ($ in millions) 2007 $ 2,043.1 $ 2,024.0 $ 2,038.1 $ 2,033.2 $ 2,014.2 $ 1,998.4 $ 1,990.2 $ 1,953.8 $ 1,938.0 $ 1,928.4 $ 122.3 2008 2,262.7 2,301.0 2,311.8 2,294.4 2,313.3 2,323.3 2,324.8 2,304.4 2,293.5 154.3 2009 2,228.9 2,188.7 2,177.5 2,168.7 2,165.9 2,171.6 2,193.4 2,186.0 170.0 2010 2,123.1 2,108.9 2,076.5 2,041.8 1,982.7 1,953.2 1,927.9 245.5 2011 2,027.2 2,033.2 2,002.2 1,967.5 1,932.1 1,913.6 283.7 2012 1,899.8 1,937.4 1,932.7 1,866.3 1,817.0 364.2 2013 1,649.3 1,671.0 1,637.6 1,600.9 453.7 2014 1,652.2 1,624.0 1,603.1 603.6 2015 1,558.2 1,567.7 789.4 2016 1,894.7 1,295.2 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 18,732.8 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident Year 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 ($ in millions) 2007 $ 354.0 $ 721.7 $ 912.8 $ 1,137.3 $ 1,282.4 $ 1,402.1 $ 1,495.0 $ 1,572.8 $ 1,657.3 $ 1,695.4 2008 452.8 853.4 1,137.0 1,337.2 1,515.3 1,676.2 1,809.2 1,912.0 1,972.5 2009 482.0 850.2 1,089.8 1,285.3 1,445.2 1,597.3 1,749.2 1,828.7 2010 438.8 779.7 985.0 1,154.9 1,305.4 1,458.7 1,541.8 2011 406.1 695.8 959.1 1,194.3 1,360.6 1,475.3 2012 401.7 721.3 941.1 1,109.3 1,264.1 2013 287.6 608.6 789.9 959.3 2014 281.0 528.6 752.8 2015 250.7 509.5 2016 402.1 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 12,401.5 Total incurred loss and LAE for the 2007 through 2016 accident years $ 18,732.8 Cumulative paid loss and LAE for the 2007 through 2016 accident years 12,401.5 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 767.1 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 7,098.4 Insurance Segment - RSUI - Property Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of December 31, 2016 Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 IBNR Cumulative (1) ($ in millions, except reported claims) 2007 $ 69.2 $ 67.8 $ 66.9 $ 64.2 $ 64.7 $ 64.5 $ 64.8 $ 65.8 $ 65.8 $ 65.8 $ 0.6 1,192 2008 176.0 181.3 178.2 183.8 193.3 192.8 192.2 192.4 192.5 0.8 1,839 2009 78.3 63.1 60.1 62.5 63.1 63.7 64.5 64.7 0.9 1,313 2010 110.2 101.7 101.8 105.7 104.2 109.8 109.9 1.1 1,630 2011 168.8 162.0 160.5 159.9 159.0 159.3 1.5 2,202 2012 270.9 262.5 258.6 256.1 235.1 6.6 2,309 2013 157.3 157.2 150.4 152.1 3.1 2,387 2014 170.7 166.2 155.9 6.7 3,079 2015 140.5 136.1 11.8 2,958 2016 181.4 49.0 2,944 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 1,452.8 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 ($ in millions) 2007 $ 24.7 $ 47.0 $ 58.5 $ 61.4 $ 62.9 $ 63.1 $ 63.4 $ 64.9 $ 65.0 $ 65.1 2008 65.3 138.8 155.3 173.1 187.6 189.0 190.6 191.2 191.6 2009 36.6 51.0 54.3 58.9 61.4 61.9 63.3 63.6 2010 53.0 83.6 92.4 98.6 100.6 101.1 101.5 2011 61.0 118.4 144.0 154.3 156.1 157.2 2012 62.0 157.5 181.9 193.5 202.4 2013 72.7 118.7 134.0 141.1 2014 93.2 133.8 145.0 2015 70.8 106.9 2016 72.0 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 1,246.4 Total incurred loss and LAE for the 2007 through 2016 accident years $ 1,452.8 Cumulative paid loss and LAE for the 2007 through 2016 accident years 1,246.4 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 2.1 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 208.5 (1) Represents claims reported by insured claimants. Insurance Segment - RSUI - Casualty Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of December 31, 2016 Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 IBNR Cumulative (1) ($ in millions, except reported claims) 2007 $ 252.8 $ 257.6 $ 253.6 $ 252.2 $ 243.9 $ 232.6 $ 225.7 $ 215.5 $ 206.4 $ 201.7 $ 22.1 5,992 2008 255.0 255.0 260.6 254.8 245.3 237.0 230.8 220.9 216.9 27.5 7,105 2009 230.1 233.7 234.4 236.3 236.3 232.2 221.8 212.0 34.8 6,843 2010 204.1 204.1 204.1 203.4 194.6 178.6 177.0 28.9 6,859 2011 205.9 205.9 208.3 212.1 211.6 206.8 45.3 7,459 2012 226.3 226.3 230.3 242.8 238.9 72.6 7,518 2013 264.8 264.8 277.6 280.1 99.4 8,503 2014 292.0 322.7 321.1 144.3 9,870 2015 300.2 300.2 207.6 8,661 2016 290.7 252.2 7,156 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 2,445.4 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 ($ in millions) 2007 $ 4.1 $ 24.2 $ 63.0 $ 88.9 $ 117.4 $ 151.4 $ 158.8 $ 164.2 $ 170.5 $ 171.9 2008 9.5 35.1 89.5 124.4 145.3 157.4 164.2 171.3 179.4 2009 7.2 38.0 73.2 101.9 136.9 149.5 157.5 166.4 2010 4.7 30.9 70.1 90.1 122.6 128.6 132.9 2011 6.5 31.9 66.7 100.3 118.4 138.5 2012 6.8 38.4 96.0 125.5 144.0 2013 10.1 50.0 103.4 146.2 2014 13.0 69.5 130.1 2015 9.0 47.3 2016 13.7 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 1,270.4 Total incurred loss and LAE for the 2007 through 2016 accident years $ 2,445.4 Cumulative paid loss and LAE for the 2007 through 2016 accident years 1,270.4 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 54.0 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 1,229.0 (1) Represents claims reported by insured claimants. Insurance Segment - CapSpecialty (1) Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of December 31, 2016 Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 IBNR Cumulative (2) ($ in millions, except reported claims) 2007 $ 110.2 $ 107.8 $ 103.6 $ 108.4 $ 109.2 $ 109.9 $ 109.3 $ 109.7 $ 107.9 $ 107.2 $ 1.1 11,028 2008 102.6 97.1 93.2 90.1 89.6 94.3 94.2 96.5 96.8 0.5 8,835 2009 92.2 93.3 90.4 95.7 98.8 99.0 97.9 98.0 0.7 8,527 2010 93.2 110.8 117.9 134.8 134.5 129.8 129.5 3.0 8,205 2011 74.0 71.2 74.4 76.9 79.4 78.4 2.5 5,682 2012 72.7 71.8 66.2 69.3 69.7 2.7 5,250 2013 78.7 81.4 85.2 84.4 4.6 5,106 2014 102.8 102.7 101.0 14.4 5,772 2015 111.0 111.8 34.1 5,193 2016 129.4 78.0 4,628 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 1,006.2 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 ($ in millions) 2007 $ 30.7 $ 56.4 $ 74.9 $ 91.1 $ 99.3 $ 104.2 $ 105.7 $ 106.8 $ 107.8 $ 107.9 2008 26.3 43.8 63.9 74.6 82.4 87.2 90.3 91.7 93.1 2009 27.7 50.1 62.5 78.2 87.2 92.7 94.4 95.7 2010 22.0 56.2 78.4 98.1 111.0 119.2 121.6 2011 16.3 31.9 44.7 57.7 67.3 69.8 2012 18.6 38.6 46.9 57.2 63.3 2013 23.4 48.0 62.0 69.6 2014 34.0 56.3 71.9 2015 30.9 57.4 2016 30.3 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 780.6 Total incurred loss and LAE for the 2007 through 2016 accident years $ 1,006.2 Cumulative paid loss and LAE for the 2007 through 2016 accident years 780.6 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 10.8 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 236.4 (1) The vast majority of the CapSpecialty’s loss and LAE reserves relate to its casualty lines of business. (2) Represents claims reported by insured claimants. Insurance Segment - PacificComp Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of December 31, 2016 Accident 2007 (unaudited) 2008 (unaudited) 2009 (unaudited) 2010 (unaudited) 2011 (unaudited) 2012 (unaudited) 2013 (unaudited) 2014 (unaudited) 2015 (unaudited) 2016 IBNR Cumulative (1) ($ in millions, except reported claims) 2007 $ 90.9 $ 105.6 $ 112.4 $ 113.8 $ 116.8 $ 118.7 $ 121.7 $ 122.8 $ 123.4 $ 123.0 $ 4.5 8,449 2008 79.1 90.0 100.6 107.3 108.3 110.8 110.9 109.9 109.1 5.7 5,789 2009 58.2 61.0 74.5 75.8 80.2 82.0 82.0 83.0 4.3 3,013 2010 4.1 5.1 5.4 5.7 6.0 6.0 5.8 0.5 211 2011 2.8 2.8 3.0 3.0 3.0 2.8 0.3 100 2012 14.5 15.1 15.1 15.1 14.7 2.0 560 2013 31.0 30.4 30.4 29.3 5.7 1,005 2014 52.6 52.6 53.5 8.1 2,218 2015 76.6 76.8 25.4 3,362 2016 104.8 47.2 4,302 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 602.8 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident 2007 (unaudited) 2008 (unaudited) 2009 (unaudited) 2010 (unaudited) 2011 (unaudited) 2012 (unaudited) 2013 (unaudited) 2014 (unaudited) 2015 (unaudited) 2016 ($ in millions) 2007 $ 17.9 $ 39.7 $ 59.2 $ 74.7 $ 85.9 $ 92.9 $ 97.8 $ 103.1 $ 106.8 $ 108.9 2008 15.5 35.6 55.3 69.2 78.6 85.8 91.2 94.6 97.2 2009 12.0 28.0 41.1 50.8 58.3 64.7 68.6 71.7 2010 1.4 2.7 3.4 4.0 4.5 4.8 4.9 2011 0.6 1.1 1.7 2.0 2.1 2.5 2012 2.4 5.6 8.2 10.0 11.0 2013 4.7 10.1 15.4 18.4 2014 8.8 20.8 30.1 2015 10.4 24.9 2016 15.6 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 385.2 Total incurred loss and LAE for the 2007 through 2016 accident years $ 602.8 Cumulative paid loss and LAE for the 2007 through 2016 accident years 385.2 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 15.1 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 232.7 (1) Represents claims reported by insured claimants. Loss and LAE Reserve Summary and Reconciliation to Consolidated Balance Sheet Unpaid loss and LAE as of December 31, 2016 (1) Gross Loss and Reinsurance Net Loss and ($ in millions) Reinsurance Segment Property $ 952.7 $ (106.7) $ 846.0 Casualty & other 7,324.4 (226.0) 7,098.4 8,277.1 (332.7) 7,944.4 Insurance Segment RSUI - Property 395.3 (186.8) 208.5 RSUI - Casualty 1,981.0 (752.0) 1,229.0 RSUI 2,376.3 (938.8) 1,437.5 CapSpecialty 267.8 (31.4) 236.4 PacificComp 234.5 (1.8) 232.7 2,878.6 (972.0) 1,906.6 Eliminations (68.5) 68.5 – Total $ 11,087.2 $ (1,236.2) $ 9,851.0 (1) Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. (d) Supplementary Information on Historical Loss and LAE Duration (Unaudited) The following is supplemental information about average historical loss and LAE duration, net of reinsurance, as of December 31, 2016. Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance As of December 31, 2016 Years 1 2 3 4 5 6 7 8 9 10 Reinsurance Segment: Property 28.6% 37.2% 16.6% 7.8% 3.8% 1.9% 1.4% (0.1%) 0.2% 0.0% Casualty & other 19.9% 17.3% 11.9% 10.0% 7.9% 6.8% 5.5% 4.1% 3.5% 2.0% Insurance Segment: RSUI - Property 40.1% 31.3% 10.3% 6.1% 3.4% 0.6% 0.9% 1.0% 0.2% 0.2% RSUI - Casualty 3.4% 13.5% 20.2% 13.9% 12.5% 8.3% 3.3% 3.4% 3.4% 0.7% CapSpecialty 25.9% 23.8% 16.2% 14.0% 9.2% 5.1% 2.0% 1.2% 1.2% 0.1% PacificComp 16.5% 19.8% 16.8% 11.8% 7.5% 7.7% 3.9% 3.7% 2.6% 1.8% |
Credit Agreements
Credit Agreements | 12 Months Ended |
Dec. 31, 2016 | |
Credit Agreements | 7. Credit Agreements On October 15, 2013, Alleghany entered into a four-year credit agreement (the “Credit Agreement”) which provides for an unsecured credit facility in an aggregate principal amount of up to $200.0 million. The Credit Agreement is scheduled to terminate on October 15, 2017, unless terminated at an earlier date. Borrowings under the Credit Agreement will be available for working capital and general corporate purposes. Borrowings under the Credit Agreement bear a floating rate of interest based in part on Alleghany’s credit rating, among other factors. The Credit Agreement requires that all loans be repaid in full no later than October 15, 2017. The Credit Agreement also requires Alleghany to pay a commitment fee each quarter in a range of between 0.125 and 0.30 percent per annum, based upon Alleghany’s credit rating, on the daily unused amount of the commitments. The Credit Agreement contains representations, warranties and covenants customary for bank loan facilities of this nature. In the fourth quarter of 2015, Alleghany borrowed and repaid $60.0 million under the Credit Agreement. As of December 31, 2016, there were no outstanding borrowings under the Credit Agreement. In addition to the Credit Agreement, several of Alleghany Capital’s subsidiaries have credit agreements with third-party financial institutions. Any borrowings under such agreements are not guaranteed by Alleghany or Alleghany Capital. See Note 8(c) for information on the borrowings arising from these credit agreements. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2016 | |
Debt | 8. Debt (a) Alleghany Senior Notes On September 9, 2014, Alleghany completed a public offering of $300.0 million aggregate principal amount of its 4.90% senior notes due on September 15, 2044 (the “2044 Senior Notes”). The 2044 Senior Notes are unsecured and unsubordinated general obligations of Alleghany. Interest on the 2044 Senior Notes is payable semi-annually on March 15 and September 15 of each year. The terms of the 2044 Senior Notes permit redemption prior to their maturity. The indenture under which the 2044 Senior Notes were issued contains covenants that impose conditions on Alleghany’s ability to create liens on, or engage in sales of, the capital stock of AIHL, TransRe or RSUI. The 2044 Senior Notes were issued at approximately 99.3 percent of par, resulting in proceeds after underwriting discount, commissions and other expenses of $294.3 million and an effective yield of approximately 5.0 percent. On June 26, 2012, Alleghany completed a public offering of $400.0 million aggregate principal amount of its 4.95% senior notes due on June 27, 2022 (the “2022 Senior Notes”). The 2022 Senior Notes are unsecured and unsubordinated general obligations of Alleghany. Interest on the 2022 Senior Notes is payable semi-annually on June 27 and December 27 of each year. The terms of the 2022 Senior Notes permit redemption prior to their maturity. The indenture under which the 2022 Senior Notes were issued contains covenants that impose conditions on Alleghany’s ability to create liens on, or engage in sales of, the capital stock of AIHL, TransRe or RSUI. The 2022 Senior Notes were issued at approximately 99.9 percent of par, resulting in proceeds after underwriting discount, commissions and other expenses of $396.0 million and an effective yield of approximately 5.05 percent. On September 20, 2010, Alleghany completed a public offering of $300.0 million aggregate principal amount of its 5.625% senior notes due on September 15, 2020 (the “2020 Senior Notes”). The 2020 Senior Notes are unsecured and unsubordinated general obligations of Alleghany. Interest on the 2020 Senior Notes is payable semi-annually on March 15 and September 15 of each year. The terms of the 2020 Senior Notes permit redemption prior to their maturity. The indenture under which the 2020 Senior Notes were issued contains covenants that impose conditions on Alleghany’s ability to create liens on, or engage in sales of, the capital stock of AIHL or RSUI. The 2020 Senior Notes were issued at approximately 99.6 percent of par, resulting in proceeds after underwriting discount, commissions and other expenses of $298.9 million and an effective yield of approximately 5.67 percent. (b) TransRe Senior Notes On December 14, 2005, TransRe completed a public offering of $750.0 million aggregate principal amount of its 2015 Senior Notes. Prior to the merger with TransRe, a portion of the 2015 Senior Notes was repurchased by TransRe. On October 15, 2014, TransRe redeemed $300.0 million aggregate principal amount of the 2015 Senior Notes for $324.4 million, consisting of the $300.0 million aggregate principal amount redeemed, $18.6 million of redemption premium and $5.8 million of accrued and unpaid interest to the date of redemption. Of the $324.4 million redemption amount, $297.3 million was funded by a capital contribution from Alleghany primarily using the $294.3 million of net proceeds from Alleghany’s issuance of the 2044 Senior Notes. As a result of this early extinguishment of debt, TransRe recorded a realized loss, before tax, of $9.4 million in 2014. On December 14, 2015, the remaining $367.0 million outstanding aggregate principal amount of TransRe’s 2015 Senior Notes matured and was repaid. On November 23, 2009, TransRe completed a public offering of $350.0 million aggregate principal amount of its 8.00% senior notes due on November 30, 2039 (the “2039 Senior Notes”). The 2039 Senior Notes are unsecured and unsubordinated general obligations of TransRe and are not guaranteed by Alleghany. Interest on the 2039 Senior Notes is payable semi-annually. The terms of the 2039 Senior Notes permit redemption prior to their maturity. The indentures under which the 2039 Senior Notes were issued contain covenants that impose conditions on TransRe’s ability to create liens on, or engage in sales of, the capital stock of certain of its subsidiaries, including Transatlantic Reinsurance Company, TransRe Zurich Ltd. or Fair American Insurance and Reinsurance Company. (c) Alleghany Capital Operating Subsidiaries The debt associated with Alleghany Capital’s operating subsidiaries totaled $92.8 million and $36.3 million as of December 31, 2016 and 2015, respectively. As of December 31, 2016, the $92.8 million includes $41.0 million of debt at Kentucky Trailer related primarily to a mortgage loan, borrowings to finance small acquisitions and borrowings under its available credit facility, $31.2 million of borrowings by Jazwares under its available credit facility and $20.6 million of debt at Bourn & Koch related to borrowings to finance an acquisition. None of these liabilities are guaranteed by Alleghany or Alleghany Capital. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Taxes | 9. Income Taxes Income tax expense (benefit) consisted of the following: Federal State Foreign Total ($ in millions) Year ended December 31, 2016 Current $ 49.4 $ 4.9 $ 23.4 $ 77.7 Deferred 109.6 0.3 (0.5) 109.4 $ 159.0 $ 5.2 $ 22.9 $ 187.1 Year ended December 31, 2015 Current $ 93.3 $ 3.1 $ 50.0 $ 146.4 Deferred 49.2 (0.4) - 48.8 $ 142.5 $ 2.7 $ 50.0 $ 195.2 Year ended December 31, 2014 Current $ 115.4 $ 4.9 $ 118.2 $ 238.5 Deferred 12.9 0.4 - 13.3 $ 128.3 $ 5.3 $ 118.2 $ 251.8 Income before income taxes from domestic operations was $407.7 million, $376.7 million and $633.8 million in 2016, 2015 and 2014, respectfully. Income before income taxes from foreign operations was $240.1 million, $380.7 million and $298.1 million in 2016, 2015 and 2014, respectively. Foreign tax expense was primarily attributable to the United Kingdom (the “U.K.”). The difference between the federal income tax rate and the effective income tax rate was as follows: Year Ended December 31, 2016 2015 2014 Federal income tax rate 35.0% 35.0% 35.0% Foreign tax credits (0.6) (0.4) - Income subject to dividends-received deduction (1.6) (1.6) (1.3) Tax-exempt (6.5) (6.8) (6.5) State taxes, net of federal tax benefit 0.6 0.2 0.4 Prior period adjustment 2.4 (0.2) 0.1 Other, net (0.4) (0.4) (0.7) Effective tax rate 28.9% 25.8% 27.0% The increase in the effective tax rate in 2016 from 2015 primarily reflects larger prior period income tax expense adjustments, higher state income taxes and lower tax-exempt out-of-period The slight decrease in the effective tax rate in 2015 compared with 2014 primarily reflects lower taxable income in 2015, partially offset by lower interest income arising from municipal bond securities. The tax effects of temporary differences that give rise to the deferred tax assets and deferred tax liabilities as of December 31, 2016 and 2015 are as follows: As of December 31, 2016 2015 ($ in millions) Deferred tax assets: Loss and LAE reserves $ 212.1 $ 242.7 Minimum tax credit carry forward 28.9 110.2 Compensation accruals 166.7 161.9 Unearned premiums 139.1 134.0 OTTI losses 19.5 21.9 State net operating loss carry forward 25.2 17.9 Other 173.3 167.2 Gross deferred tax assets before valuation allowance 764.8 855.8 Valuation allowance (25.2) (17.9) Gross deferred tax assets 739.6 837.9 Deferred tax liabilities: Net unrealized gains on investments 125.8 120.8 Deferred acquisition costs 163.3 146.8 Purchase accounting adjustments 30.2 43.8 Other 65.4 58.1 Gross deferred tax liabilities 384.7 369.5 Net deferred tax assets $ 354.9 $ 468.4 A valuation allowance is provided against deferred tax assets when, in the opinion of management, it is more likely than not that a portion of the deferred tax asset will not be realized. As of December 31, 2016 and 2015, Alleghany recognized $25.2 million and $17.9 million, respectively, of deferred tax assets for certain state net operating and capital loss carryovers, and a valuation allowance of $25.2 million and $17.9 million, respectively, has been established against these deferred tax assets as Alleghany does not currently anticipate it will generate sufficient income in these states to absorb such loss carryovers. The Internal Revenue Code provides for limits on the utilization of certain tax benefits following a corporate ownership change. Upon the closing of the merger with TransRe, TransRe was subject to an annual limitation on its ability to use its foreign tax credit carryforwards and its minimum tax credit carryforwards. The total amount of foreign tax credit carryforwards and minimum tax credit carryforwards that were available prior to the merger are not diminished by this provision. The limitation provides for an annual limit on the amount of the carryforwards that can be used each year. The unused carryovers are available to be used in subsequent years, subject to the annual limitation. The annual limitation is estimated at approximately $42.7 million. Alleghany’s income tax returns are currently under examination by the Internal Revenue Service for the 2012, 2013 and 2014 tax years. TransRe’s income tax returns, which all relate to periods prior to the merger with Alleghany, are currently under examination by the Internal Revenue Service. The following table lists the tax years of Alleghany and TransRe tax returns that remain subject to examination by major tax jurisdictions as of December 31, 2016. Major Tax Jurisdiction Open Tax Years Australia 2012-2015 Canada 2012-2015 France 2009, 2010 and 2013-2015 Germany 2013-2015 Hong Kong 2014-2015 Japan 2010-2015 Singapore 2014-2016 Switzerland 2015 U.K. 2014-2015 U.S. 2007-2015 Alleghany believes that, as of December 31, 2016, it had no material uncertain tax positions. Interest and penalties relating 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 December 31, 2016. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Stockholders' Equity | 10. Stockholders’ Equity (a) Common Stock Repurchases In October 2012, the Alleghany Board of Directors authorized the repurchase of shares of Common Stock, at such times and at prices as management determined to be advisable, up to an aggregate of $300.0 million (the “2012 Repurchase Program”). In July 2014, the Alleghany Board of Directors authorized, upon the completion of the 2012 Repurchase 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 $350.0 million (the “2014 Repurchase Program”). In the fourth quarter of 2014, Alleghany completed the 2012 Repurchase Program and subsequent repurchases have been made pursuant to the 2014 Repurchase Program. In November 2015, the Alleghany Board of Directors authorized the repurchase, upon the completion of the 2014 Repurchase Program, of additional shares of Common Stock, at such times and at prices as management determines to be advisable, up to an aggregate of $400.0 million (the “2015 Repurchase Program”). In the first quarter of 2016, Alleghany completed the 2014 Repurchase Program and subsequent repurchases have been made pursuant to the 2015 Repurchase Program. As of December 31, 2016, Alleghany had $379.2 million remaining under its share repurchase authorization. Pursuant to the 2012 Repurchase Program, 2014 Repurchase Program and the 2015 Repurchase Program, as applicable, Alleghany repurchased shares of Common Stock in 2016, 2015 and 2014 as follows: Year Ended December 31, 2016 2015 2014 Shares repurchased 142,186 520,466 732,391 Cost of shares repurchased (in millions) $ 68.3 $ 243.8 $ 300.5 Average price per share repurchased $ 480.49 $ 468.45 $ 410.27 (b) Accumulated Other Comprehensive Income The following table presents a reconciliation of the changes during 2016 and 2015 in accumulated other comprehensive income attributable to Alleghany stockholders: Unrealized Unrealized Retirement Total ($ in millions) Balance as of January 1, 2016 $ 231.9 $ (104.0) $ (11.6) $ 116.3 Other comprehensive income (loss), net of tax: Other comprehensive income (loss) before reclassifications 67.7 (7.2) (0.1) 60.4 Reclassifications from accumulated other comprehensive income (67.4) - - (67.4) Total 0.3 (7.2) (0.1) (7.0) Balance as of December 31, 2016 $ 232.2 $ (111.2) $ (11.7) $ 109.3 Unrealized Unrealized Retirement Total ($ in millions) Balance as of January 1, 2015 $ 455.4 $ (89.2) $ (12.6) $ 353.6 Other comprehensive income (loss), net of tax: Other comprehensive income (loss) before reclassifications (154.8) (14.8) 1.0 (168.6) Reclassifications from accumulated other comprehensive income (68.7) - - (68.7) Total (223.5) (14.8) 1.0 (237.3) Balance as of December 31, 2015 $ 231.9 $ (104.0) $ (11.6) $ 116.3 Reclassifications out of accumulated other comprehensive income attributable to Alleghany stockholders during 2016 and 2015 were as follows: Accumulated Other Comprehensive Income Component Line in Consolidated Statement of Earnings Year Ended December 31, 2016 2015 ($ in millions) Unrealized appreciation of investments: Net realized capital gains (1) $ (148.8) $ (239.7) Other than temporary impairment losses 45.2 133.9 Income taxes 36.2 37.1 Total reclassifications: Net earnings $ (67.4) $ (68.7) (1) For 2016, excludes a ($98.8) million impairment charge from a write-down of certain SORC assets and the Jazwares Remeasurement Gain of $13.2 million. For 2015, excludes a ($25.8) million realized capital loss related to an impairment charge related to a write-off (c) Regulations and Dividend Restrictions As of December 31, 2016, approximately $6.6 billion of Alleghany’s total equity of $7.9 billion was unavailable for dividends or advances to Alleghany from its subsidiaries. The remaining $1.3 billion was available for dividends or advances to Alleghany from its subsidiaries, or was retained at the Alleghany parent company-level and, as such, was available to pay dividends to Alleghany’s stockholders as of December 31, 2016. The ability of Alleghany’s reinsurance and insurance subsidiaries to pay dividends or other distributions is subject to the laws and regulations applicable to each subsidiary, as well as each subsidiary’s need to maintain capital requirements adequate to maintain its operations and financial strength ratings issued by independent rating agencies. In the U.S., Alleghany’s reinsurance and insurance subsidiaries are subject to insurance laws and regulations that restrict the amount and timing of dividends they may pay without the prior approval of regulatory authorities. Under the insurance holding company laws and regulations, Alleghany’s reinsurance and insurance subsidiaries may not pay an “extraordinary” dividend or distribution without the approval of state insurance regulators. In general, an “extraordinary” dividend or distribution is defined as a dividend or distribution that, together with other dividends and distributions made within the preceding 12 months, exceeds the lesser (or, in some jurisdictions, the greater) of (i) 10 percent of the statutory surplus of the reinsurer or insurer as of the end of the prior calendar year (or, in certain states, as of the end of the prior quarter) and (ii) the net income during the prior calendar year (or, in certain states, the adjusted statutory net investment income). In addition, certain states where Alleghany’s reinsurance and insurance subsidiaries are domiciled prohibit a domestic insurance company from paying dividends except out of earned surplus. TransRe’s operations are also regulated in various foreign jurisdictions with respect to currency, amount and type of security deposits, amount and type of reserves and amount and type of local investment. Regulations governing constitution of technical reserves and remittance balances in some countries may hinder remittance of profits and repatriation of assets. International operations and assets held abroad may also be adversely affected by political and other developments in foreign countries, including possible tax changes, nationalization and changes in regulatory policy, as well as by consequences of hostilities and unrest. The risks of such occurrences and their overall effect upon TransRe vary from country to country and cannot easily be predicted. A summary of dividends paid to Alleghany by its reinsurance and insurance subsidiaries in 2016, 2015 and 2014 follows: Year Ended December 31, 2016 2015 2014 ($ in millions) TransRe (1) $ 375.0 $ 250.0 $ 300.0 RSUI 100.0 150.0 225.0 Total $ 475.0 $ 400.0 $ 525.0 (1) In 2016, 2015 and 2014, TRC paid dividends of $350.0 million, $400.0 million and $400.0 million, respectively, to the TransRe holding company. As of December 31, 2016, a maximum amount of $15.0 million was available for dividends by TRC without prior approval of the applicable regulatory authorities. The statutory net income of Alleghany’s reinsurance and insurance subsidiaries was $688.9 million and $741.0 million for the years ended December 31, 2016 and 2015, respectively. As of December 31, 2016 and 2015, the combined statutory capital and surplus of Alleghany’s reinsurance and insurance subsidiaries was $6.7 billion and $6.6 billion, respectively. As of December 31, 2016, the amount of statutory capital and surplus necessary to satisfy regulatory requirements was not significant in relation to the actual statutory capital and surplus of Alleghany’s reinsurance and insurance companies in the U.S. |
Earnings Per Share of Common St
Earnings Per Share of Common Stock | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share of Common Stock | 11. Earnings Per Share of Common Stock The following is a reconciliation of the earnings and share data used in the basic and diluted earnings per share computations for 2016, 2015 and 2014: Year Ended December 31, 2016 2015 2014 ($ in millions, except share amounts) Net earnings available to Alleghany stockholders $ 456.9 $ 560.3 $ 679.2 Adjustment related to redeemable noncontrolling interests - (2.6) - Income available to common stockholders for basic earnings per share 456.9 557.7 679.2 Effect of dilutive securities - 0.1 - Income available to common stockholders for diluted earnings per share $ 456.9 $ 557.8 $ 679.2 Weighted average common shares outstanding applicable to basic earnings per share 15,436,286 15,871,055 16,405,388 Effect of dilutive securities 6,363 8,046 - Adjusted weighted average common shares outstanding applicable to diluted earnings 15,442,649 15,879,101 16,405,388 68,429, 77,441 and 72,528 contingently issuable shares were potentially available during 2016, 2015 and 2014, respectively, 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 | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies | 12. Commitments and Contingencies (a) 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. (b) Leases Alleghany and its subsidiaries lease certain facilities, furniture and equipment under long-term lease agreements. In addition, certain land, office space and equipment are leased under non-cancelable Year Aggregate Minimum ($ in millions) 2017 $ 37.2 2018 35.0 2019 31.3 2020 27.6 2021 25.0 2022 and thereafter 119.3 (c) Asbestos-Related Illness and Environmental Impairment Exposure Loss and LAE include amounts for risks relating to asbestos-related illness and environmental impairment. As of December 31, 2016 and 2015, such gross and net reserves were as follows: December 31, 2016 December 31, 2015 Gross Net Gross Net ($ in millions) TransRe $ 165.7 $ 160.0 $ 174.9 $ 168.4 CapSpecialty 6.3 6.3 8.7 8.6 Total $ 172.0 $ 166.3 $ 183.6 $ 177.0 The reserves carried for such claims, including the IBNR portion, are based upon known facts and current law at the respective balance sheet dates. However, significant uncertainty exists in determining the amount of ultimate liability for asbestos-related illness and environmental impairment losses, particularly for those occurring in 1985 and prior, which, before TransRe’s entry into the Commutation Agreement, represented the majority of TransRe’s asbestos-related illness and environmental impairment reserves. This uncertainty is due to inconsistent and changing court resolutions and judicial interpretations with respect to underlying policy intent and coverage and uncertainties as to the allocation of responsibility for resultant damages, among other reasons. Further, possible future changes in statutes, laws, regulations, theories of liability and other factors could have a material effect on these liabilities and, accordingly, future earnings. (d) Energy Holdings As of December 31, 2016, Alleghany had holdings in energy sector businesses of $871.1 million, comprised of $313.3 million of debt securities, $408.6 million of equity securities and $149.2 million of our equity attributable to SORC. |
Segments of Business
Segments of Business | 12 Months Ended |
Dec. 31, 2016 | |
Segments of Business | 13. 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 business into two reportable segments – reinsurance and insurance. Other activities include Alleghany Capital and corporate activities. In addition, reinsurance and insurance underwriting activities are evaluated separately from investment and other activities. Net realized capital gains and OTTI losses are not considered relevant in evaluating investment performance on an annual basis. Segment accounting policies are described in Note 1. 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 & other. TransRe provides property and casualty reinsurance to insurers and reinsurers through brokers and on a direct basis to ceding companies. TransRe also writes a modest amount of insurance business, which is included in the reinsurance segment. Over one-third The insurance segment consists of property and casualty insurance operations conducted in the U.S. by AIHL through its insurance operating subsidiaries RSUI, CapSpecialty and PacificComp. RSUI also writes a modest amount of assumed reinsurance business, which is included in the insurance segment. The components of other activities are Alleghany Capital and corporate activities. Alleghany Capital consists of manufacturing and service operations, oil and gas operations and corporate operations and investments at the Alleghany Capital level. Manufacturing and service operations are conducted through Bourn & Koch, Kentucky Trailer, IPS and Jazwares. Oil and gas operations are conducted through SORC, and also included Alleghany Capital’s investment in ORX until it was sold on December 23, 2016. ORX was accounted for under the equity method of accounting. The primary components of corporate activities are Alleghany Properties and other activities at the Alleghany parent company. In addition, corporate activities include interest expense associated with the Alleghany Senior Notes, whereas interest expense associated with the TransRe Senior Notes is included in “Total Segments” and interest expense associated with other debt is included in Alleghany Capital. Information related to Senior Notes and other debt can be found in Note 8. (b) Results Segment results for Alleghany’s two reportable segments and for corporate activities for 2016, 2015 and 2014 are shown in the tables below: Reinsurance Segment Insurance Segment Other Activities Year Ended December 31, 2016 Property Casualty (1) Total RSUI Cap Pacific Total Total Alleghany Corporate (2) Consolidated ($ in millions) Gross premiums written $ 1,515.5 $ 2,814.8 $ 4,330.3 $ 1,056.4 $ 266.5 $ 139.8 $ 1,462.7 $ 5,793.0 $ - $ (25.9) $ 5,767.1 Net premiums written 1,237.2 2,732.2 3,969.4 734.1 250.0 138.3 1,122.4 5,091.8 - - 5,091.8 Net premiums earned 1,168.0 2,677.0 3,845.0 754.5 237.5 138.8 1,130.8 4,975.8 - - 4,975.8 Net loss and LAE 578.4 1,707.0 2,285.4 403.8 125.3 102.7 631.8 2,917.2 - - 2,917.2 Commissions, brokerage and other underwriting (3) 376.2 922.8 1,299.0 212.3 107.3 38.7 358.3 1,657.3 - - 1,657.3 Underwriting profit (loss) (4) $ 213.4 $ 47.2 $ 260.6 $ 138.4 $ 4.9 $ (2.6) $ 140.7 401.3 - - 401.3 Net investment income 433.1 (2.3) 7.7 438.5 Net realized capital gains 159.9 (86.0) (10.7) 63.2 Other than temporary impairment losses (45.2) - - (45.2) Other revenue 4.4 687.1 7.3 698.8 Other operating expenses 80.6 680.5 4.1 765.2 Corporate administration 1.0 - 42.0 43.0 Amortization of intangible assets (3.1) 22.1 - 19.0 Interest expense 27.2 1.9 52.5 81.6 Earnings (losses) before income taxes $ 847.8 $ (105.7) $ (94.3) $ 647.8 Reinsurance Segment Insurance Segment Other Activities Year Ended December 31, 2015 Property Casualty (1) Total RSUI Cap Pacific Total Total Alleghany Corporate (2) Consolidated ($ in millions) Gross premiums written $ 1,171.9 $ 2,490.2 $ 3,662.1 $ 1,148.4 $ 236.6 $ 103.1 $ 1,488.1 $ 5,150.2 $ - $ (28.0) $ 5,122.2 Net premiums written 953.6 2,433.7 3,387.3 779.4 220.6 101.9 1,101.9 4,489.2 - - 4,489.2 Net premiums earned 887.4 2,228.1 3,115.5 809.8 205.0 100.0 1,114.8 4,230.3 - - 4,230.3 Net loss and LAE 292.1 1,426.6 1,718.7 428.8 115.7 76.6 621.1 2,339.8 - - 2,339.8 Commissions, brokerage and other underwriting (3) 295.6 774.2 1,069.8 222.9 94.3 36.9 354.1 1,423.9 - - 1,423.9 Underwriting profit (loss) (4) $ 299.7 $ 27.3 $ 327.0 $ 158.1 $ (5.0) $ (13.5) $ 139.6 466.6 - - 466.6 Net investment income 427.6 5.4 5.8 438.8 Net realized capital gains 242.6 (25.6) (3.1) 213.9 Other than temporary impairment losses (125.5) - (8.4) (133.9) Other revenue 6.5 241.0 2.9 250.4 Other operating expenses 80.4 259.3 2.6 342.3 Corporate administration 0.9 - 45.6 46.5 Amortization of intangible assets (5.3) 3.1 - (2.2) Interest expense 38.3 1.5 52.0 91.8 Earnings (losses) before income taxes $ 903.5 $ (43.1) $ (103.0) $ 757.4 Reinsurance Segment Insurance Segment Other Activities Year Ended December 31, 2014 Property Casualty (1) Total RSUI Cap Pacific Total Total Alleghany Corporate (2) Consolidated ($ in millions) Gross premiums written $ 1,205.4 $ 2,394.7 $ 3,600.1 $ 1,242.1 $ 212.7 $ 70.5 $ 1,525.3 $ 5,125.4 $ - $ (28.8) $ 5,096.6 Net premiums written 1,073.4 2,336.7 3,410.1 825.5 192.4 69.5 1,087.4 4,497.5 - - 4,497.5 Net premiums earned 1,048.6 2,282.1 3,330.7 828.2 184.4 67.3 1,079.9 4,410.6 - - 4,410.6 Net loss and LAE 423.2 1,486.0 1,909.2 427.3 103.0 55.0 585.3 2,494.5 - - 2,494.5 Commissions, brokerage and other underwriting (3) 319.3 757.2 1,076.5 220.8 92.0 32.0 344.8 1,421.3 - - 1,421.3 Underwriting profit (loss) (4) $ 306.1 $ 38.9 $ 345.0 $ 180.1 $ (10.6) $ (19.7) $ 149.8 494.8 - - 494.8 Net investment income 448.9 2.8 8.2 459.9 Net realized capital gains 230.0 2.8 14.3 247.1 Other than temporary impairment losses (36.3) - - (36.3) Other revenue 4.0 145.6 0.9 150.5 Other operating expenses 85.7 164.5 2.5 252.7 Corporate administration 1.3 - 45.8 47.1 Amortization of intangible assets (6.1) 0.4 - (5.7) Interest expense 46.8 0.9 42.3 90.0 Earnings (losses) before income taxes $ 1,013.7 $ (14.6) $ (67.2) $ 931.9 (1) Primarily consists of the following assumed 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; surety; and credit. (2) Includes elimination of minor reinsurance activity between segments. (3) Includes amortization associated with deferred acquisition costs of $1,253.2 million, $1,024.5 million and $1,042.0 million for the years ended December 31, 2016, 2015 and 2014, respectively. (4) 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, net realized capital gains, OTTI losses, other revenue, 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 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) Foreign operations Information associated with Alleghany’s foreign operations in its reinsurance segment (representing the vast majority of Alleghany’s foreign operations), is as follows: • Foreign gross premiums written in 2016, 2015 and 2014 were approximately $1.5 billion, $1.6 billion and $1.7 billion, respectively. • Foreign net premiums earned in 2016, 2015 and 2014 were approximately $1.4 billion, $1.4 billion and $1.5 billion, respectively. The foreign country in which Alleghany generates the largest amount of premium revenues is the U.K. Net premiums earned by operations in the U.K. in 2016, 2015 and 2014 were $622.3 million, $640.4 million and $654.8 million, respectively. (d) Identifiable assets and equity As of December 31, 2016, the identifiable assets of the reinsurance segment, insurance segment and other activities were $15.7 billion, $6.7 billion and $1.4 billion, respectively, of which cash and invested assets represented $13.1 billion, $5.1 billion and $0.5 billion, respectively. As of December 31, 2016, Alleghany’s equity attributable to the reinsurance segment, insurance segment and other activities was $5.2 billion, $2.8 billion and ($0.1) billion, respectively. (e) Concentration Significant portions of the reinsurance segment’s gross premiums written are produced by a limited number of brokers. Gross premiums written produced by the reinsurance segment’s three largest brokers were approximately 25 percent, 20 percent, and 16 percent in 2016, 26 percent, 20 percent and 10 percent in 2015 and approximately 29 percent, 22 percent and 11 percent in 2014. A large whole account quota share treaty entered into in the fourth quarter of 2015 accounted for approximately 20 percent in 2016 and 6 percent in 2015 of gross premiums written in the reinsurance segment. |
Long-Term Compensation Plans
Long-Term Compensation Plans | 12 Months Ended |
Dec. 31, 2016 | |
Long-Term Compensation Plans | 14. Long-Term Compensation Plans (a) Parent Company-Level As of December 31, 2016, Alleghany had long-term compensation plans for parent company-level employees and directors. Parent company-level, long-term compensation awards to current employees do not include stock options but consist only of restricted stock awards, including restricted stock units and performance share awards. Parent company-level, long-term compensation awards to non-employee Amounts recognized as compensation expense in the consolidated statements of earnings and comprehensive income with respect to long-term compensation awards under plans for parent company-level employees and directors were $17.1 million, $19.7 million and $21.2 million in 2016, 2015 and 2014, respectively. The amount of related income tax benefit in the consolidated statements of earnings and comprehensive income with respect to these plans was $6.0 million, $6.9 million and $7.4 million in 2016, 2015 and 2014, respectively. In 2016, 2015 and 2014, $5.7 million, $4.7 million and $4.5 million of Common Stock at fair market value, respectively, and $14.4 million, $10.9 million and $7.6 million of cash, respectively, was paid by Alleghany under these plans for parent company-level employees and directors. As noted above, as of December 31, 2016 and 2015, all outstanding awards were accounted for under the fair-value-based method of accounting. The following is a summary of the parent company-level, long-term compensation plans. Director Restricted Stock Plan The annual grant to each non-employee non-employee Alleghany Long-Term Incentive Plans In February 2012, Alleghany adopted the 2012 Long-Term Incentive Plan (the “2012 LTIP”), which was approved by Alleghany stockholders in April 2012. Awards under the 2012 LTIP may include, but are not limited to, cash and/or shares of Common Stock, rights to receive cash and/or shares of Common Stock and options to purchase shares of Common Stock, including options intended to qualify as incentive stock options under the Internal Revenue Code, and options not intended to so qualify. Under the 2012 LTIP, the following types of awards were outstanding as of December 31, 2016: • Performance Share Awards — Participants are entitled, at the end of a four-year award period, to a maximum amount equal to the value of one and one-half • Restricted Share Awards — From time to time, Alleghany has awarded to certain management employees restricted shares or restricted stock units of Common Stock. These awards entitle the participants to a specified maximum amount equal to the value of one share of Common Stock for each restricted share or restricted stock unit issued to them based on the market value on the grant date, subject to certain conditions. The expense is recognized ratably over the performance period, which can be extended under certain circumstances. (b) TransRe Book Value Unit Plan and Mid-Term TransRe has a Book Value Unit Plan and a Mid-Term mid-term (c) RSUI Restricted Share Plan RSUI has a Restricted Stock Unit Plan (the “RSUI Plan”) for the purpose of providing equity-like incentives to key employees of RSUI. Under the RSUI Plan, restricted stock units (“units”) are issued. Additional units, defined as the “Deferred Equity Pool,” were issued in 2016, 2015 and 2014 and may be created in the future if certain financial performance measures are met. Units may only be settled in cash. The fair value of each unit is calculated as stockholder’s equity of RSUI, adjusted for certain capital transactions and accumulated compensation expense recognized under the RSUI Plan, divided by the sum of RSUI common stock outstanding and the original units available under the RSUI Plan. The units vest on the fourth anniversary of the date of grant and contain certain restrictions, relating to, among other things, forfeiture in the event of termination of employment and transferability. In 2016, 2015 and 2014, RSUI recorded $25.4 million, $22.7 million and $28.2 million, respectively, in compensation expense related to the RSUI Plan. During the same periods, a deferred tax benefit of $8.9 million, $7.9 million and $9.9 million, respectively, related to the compensation expense was recorded. (d) Other Subsidiary Plans Long-term incentive plans exist at certain other subsidiaries for the purpose of providing equity-like incentives to key employees. The awards under such plans were not material to Alleghany’s results of operations, financial condition or cash flows for the three years ended December 31, 2016. |
Employee Retirement Benefit Pla
Employee Retirement Benefit Plans | 12 Months Ended |
Dec. 31, 2016 | |
Employee Retirement Benefit Plans | 15. Employee Retirement Benefit Plans (a) Overview Alleghany and certain of its subsidiaries provide a variety of retirement benefits. Alleghany provides supplemental retirement benefits through deferred compensation programs and profit sharing plans for certain of its parent company-level officers and employees. In addition, Alleghany’s subsidiaries sponsor both qualified, defined contribution retirement plans for substantially all employees, including executives, and non-qualified Alleghany has endorsement split-dollar life insurance policies for its parent company-level officers that are effective during employment, as well as retirement. Premiums are paid by Alleghany and death benefits are split between Alleghany and the beneficiaries of the officers. Death benefits for current employees that inure to the beneficiaries are generally equal to four times the annual salary at the time of an officer’s death. After retirement, death benefits that inure to the beneficiaries are generally equal to the annual salary of the officer as of the date of retirement. In addition, Alleghany and TransRe have defined benefit pensions plans for certain of their employees, as further described below. These employee retirement plans are not material to Alleghany’s results of operations, financial condition or cash flows for the three years ended December 31, 2016. (b) Parent Company-Level Alleghany has an unfunded, noncontributory defined benefit pension plan for parent company-level executives, which was frozen as of December 31, 2013, and a funded, noncontributory defined benefit pension plan for parent company-level employees. The projected benefit obligations of the defined benefit pension plans as of December 31, 2016 and 2015 was $30.2 million and $28.2 million, respectively, and the related fair value of plan assets was $2.4 million and $2.5 million, respectively. (c) TransRe TransRe has an unfunded, noncontributory defined benefit plan and a funded noncontributory defined benefit plan for certain of its employees in the U.S. Benefits under TransRe’s defined benefit plans were frozen as of December 31, 2009. As of December 31, 2016 and 2015, the projected benefit obligation was $65.4 million and $63.0 million, respectively, and the related fair value of plan assets was $48.7 million and $46.7 million, respectively. |
Quarterly Results of Operations
Quarterly Results of Operations (unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Results of Operations (unaudited) | 16. Quarterly Results of Operations (unaudited) Selected quarterly financial data for 2016 and 2015 are presented below: Quarter Ended March 31 June 30 September 30 December 31 ($ in millions, except per share data) 2016 Revenues $ 1,478.9 $ 1,582.1 $ 1,614.6 $ 1,455.3 Net earnings (1) 154.5 77.1 155.8 69.5 Basic earnings per share of Common Stock (1)(2) 10.00 4.99 10.09 4.51 2015 Revenues $ 1,157.6 $ 1,300.5 $ 1,189.1 $ 1,352.4 Net earnings (1) 125.2 182.5 96.5 156.1 Basic earnings per share of Common Stock (1)(2) 7.82 11.41 6.07 9.86 (1) Attributable to Alleghany stockholders. (2) Earnings per share by quarter may not equal the amount for the full year due to the timing of repurchases of Common Stock, as well as rounding. |
Summary of Investments - Other
Summary of Investments - Other Than Investments in Related Parties | 12 Months Ended |
Dec. 31, 2016 | |
Summary of Investments - Other Than Investments in Related Parties | Schedule I – Summary of Investments – Other Than Investments in Related Parties ALLEGHANY CORPORATION AND SUBSIDIARIES December 31, 2016 Type of Investment Cost Fair Value Amount at ($ in millions) Fixed maturities: Bonds: U.S. Government obligations $ 1,265.7 $ 1,243.3 $ 1,243.3 Municipal bonds 4,161.0 4,185.8 4,185.8 Foreign government obligations 1,030.9 1,047.1 1,047.1 U.S. corporate bonds 2,168.9 2,193.1 2,193.1 Foreign corporate bonds 1,068.3 1,088.8 1,088.8 Mortgage and asset-backed securities: RMBS 1,005.9 1,000.4 1,000.4 CMBS 728.8 734.8 734.8 Other asset-backed securities 1,497.6 1,489.9 1,489.9 Fixed maturities 12,927.1 12,983.2 12,983.2 Equity securities: Common stocks: Public utilities - - - Banks, trust and insurance companies 443.1 523.9 523.9 Industrial, miscellaneous and all other 2,373.5 2,585.6 2,585.6 Nonredeemable preferred stocks - - - Equity securities 2,816.6 3,109.5 3,109.5 Commercial mortgage loans 594.9 594.9 594.9 Other invested assets 645.2 645.2 645.2 Short-term investments 778.4 778.4 778.4 Total investments $ 17,762.2 $ 18,111.2 $ 18,111.2 |
Condensed Financial Information
Condensed Financial Information of Registrant | 12 Months Ended |
Dec. 31, 2016 | |
Condensed Financial Information of Registrant | Schedule II – Condensed Financial Information of Registrant Condensed Balance Sheets ALLEGHANY CORPORATION December 31, 2016 and 2015 2016 2015 ($ in thousands) Assets Equity securities (cost: 2016 – $171,860; 2015 – $217,039) $ 187,413 $ 216,776 Debt securities (amortized cost: 2016 – $31,505; 2015 – $31,746) 31,564 30,483 Short-term investments 235,510 83,135 Other invested assets 36,741 - Cash 6,139 2,477 Property and equipment at cost, net of accumulated depreciation and amortization 5,537 259 Other assets 14,359 18,920 Net deferred tax assets 39,503 45,775 Investment in subsidiaries 8,611,000 8,325,073 Total assets $ 9,167,766 $ 8,722,898 Liabilities, Redeemable Noncontrolling Interests and Stockholders’ Equity Senior notes $ 991,376 $ 990,421 Other liabilities 112,342 110,058 Current taxes payable 49,383 41,993 Total liabilities 1,153,101 1,142,472 Redeemable noncontrolling interest 74,720 25,719 Stockholders’ equity attributable to Alleghany stockholders 7,939,945 7,554,707 Total liabilities, redeemable noncontrolling interest and stockholders’ equity $ 9,167,766 $ 8,722,898 See accompanying Notes to Condensed Financial Statements Condensed Statements of Earnings ALLEGHANY CORPORATION Year ended December 31, 2016 2015 2014 ($ in thousands) Revenues Net investment income $ 7,688 $ 5,800 $ 8,169 Net realized capital gains (10,674 ) (9,088 ) 14,349 Other than temporary impairment losses - (2,388 ) - Other revenue 159 218 265 Total revenues (2,827 ) (5,458 ) 22,783 Costs and Expenses Interest expense 52,470 52,056 42,310 Corporate administration 42,035 45,573 45,741 Total costs and expenses 94,505 97,629 88,051 Operating (losses) (97,332 ) (103,087 ) (65,268 ) Equity in earnings of consolidated subsidiaries 745,137 860,455 997,177 Earnings before income taxes 647,805 757,368 931,909 Income taxes 187,141 195,173 251,777 Net earnings 460,664 562,195 680,132 Net earnings attributable to noncontrolling interest 3,743 1,880 893 Net earnings attributable to Alleghany stockholders $ 456,921 $ 560,315 $ 679,239 See accompanying Notes to Condensed Financial Statements Condensed Statements of Cash Flows ALLEGHANY CORPORATION Year ended December 31, 2016 2015 2014 ($ in thousands) Cash flows from operating activities Net earnings $ 460,664 $ 562,195 $ 680,132 Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: Equity in undistributed net (earnings) losses of consolidated subsidiaries (524,201 ) (628,747 ) (722,445 ) Depreciation and amortization 2,035 1,949 1,845 Net realized capital (gains) losses 10,674 9,088 (14,349 ) Other than temporary impairment losses - 2,388 - Increase (decrease) in other liabilities and taxes payable 14,677 38,065 22,654 Net adjustments (496,815 ) (577,257 ) (712,295 ) Net cash (used in) provided by operating activities (36,151 ) (15,062 ) (32,163 ) Cash flows from investing activities Purchases of equity securities (132,129 ) (440,143 ) (226,418 ) Sales of debt securities - 39,548 - Maturities and redemptions of debt securities 73 89 121 Sales of equity securities 166,634 256,502 216,951 Net (purchase) sale in short-term investments (152,375 ) 69,808 (74,842 ) Purchases of property and equipment (5,779 ) (4 ) (158 ) Other, net (37,600 ) 259 383 Net cash (used in) provided by investing activities (161,176 ) (73,941 ) (83,963 ) Cash flows from financing activities Proceeds from issuance of senior notes - - 297,942 Debt issue costs paid - - (3,625 ) Treasury stock acquisitions (68,320 ) (243,814 ) (300,478 ) Capital contributions to consolidated subsidiaries (163,732 ) (175,635 ) (453,551 ) Distributions from consolidated subsidiaries 434,900 497,283 566,723 Other, net (1,859 ) 3,111 2,294 Net cash provided by (used in) financing activities 200,989 80,945 109,305 Effect of exchange rate changes on cash - - - Net (decrease) increase in cash 3,662 (8,058 ) (6,821 ) Cash at beginning of period 2,477 10,535 17,356 Cash at end of period $ 6,139 $ 2,477 $ 10,535 Supplemental disclosures of cash flow information Cash paid during the period for: Interest paid $ 51,375 $ 51,620 $ 36,675 Income taxes paid (refunds received) 37,220 (8,523 ) 221,309 See accompanying Notes to Condensed Financial Statements Notes to Condensed Financial Statements ALLEGHANY CORPORATION 1. Investment in Consolidated Subsidiaries. Reference is made to Note 1 to the Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of this Form 10-K. 2. Income Taxes. Reference is made to Note 9 to the Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of this Form 10-K. 3. Commitments and Contingencies. Reference is made to Note 12 to the Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of this Form 10-K. 4. Stockholders’ Equity. Reference is made to Note 10 to the Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of this Form 10-K 5. Senior Notes. Reference is made to Note 8 to the Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of this Form 10-K. 6. Credit Agreement. Reference is made to Note 7 to the Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of this Form 10-K. 7. Long-Term Compensation Plans. Reference is made to Note 14 to the Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of this Form 10-K. 8. Employee Retirement Benefit Plans. Reference is made to Note 15 to the Consolidated Financial Statements set forth in Part II, Item 8, “Financial Statements and Supplementary Data” of this Form 10-K. |
Supplemental Insurance Informat
Supplemental Insurance Information | 12 Months Ended |
Dec. 31, 2016 | |
Supplemental Insurance Information | Schedule III – Supplemental Insurance Information ALLEGHANY CORPORATION AND SUBSIDIARIES At December 31, For the Year Ended December 31, Year Line of Business Deferred Future Unearned Other Premium Net Benefits, Amortization Other Premiums ($ in millions) 2016 Property and Casualty Insurance $ 448.6 $ 11,087.2 $ 2,175.5 $ - $ 4,975.8 $ 433.1 $ 2,917.2 $ 1,253.2 $ 404.1 $ 5,091.8 2015 Property and Casualty Insurance $ 419.4 $ 10,779.2 $ 2,076.1 $ - $ 4,230.3 $ 427.6 $ 2,339.8 $ 1,024.5 $ 399.4 $ 4,489.2 2014 Property and Casualty Insurance $ 353.2 $ 11,597.2 $ 1,834.2 $ - $ 4,410.6 $ 448.9 $ 2,494.5 $ 1,042.0 $ 379.3 $ 4,497.5 |
Reinsurance
Reinsurance | 12 Months Ended |
Dec. 31, 2016 | |
Reinsurance | Schedule IV – Reinsurance ALLEGHANY CORPORATION AND SUBSIDIARIES Year ended December 31, Year Line of Business Gross Amount Ceded to Other Assumed from Net Amount Percentage of ($ in millions) 2016 Property and casualty $ 1,871.1 $ 729.2 $ 3,833.9 $ 4,975.8 77.1% 2015 Property and casualty $ 1,515.9 $ 688.9 $ 3,403.3 $ 4,230.3 80.5% 2014 Property and casualty $ 1,517.0 $ 646.9 $ 3,540.5 $ 4,410.6 80.3% |
Valuation and Qualifying Accoun
Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2016 | |
Valuation and Qualifying Accounts | Schedule V – Valuation and Qualifying Accounts ALLEGHANY CORPORATION AND SUBSIDIARIES Year Description Balance at Charged to Charged to Deductions Balance at ($ in millions) 2016 Allowance for uncollectible reinsurance recoverables $ - $ - $ - $ - $ - Allowance for uncollectible premiums receivable $ 0.8 $ 1.2 $ - $ 1.0 $ 1.0 2015 Allowance for uncollectible reinsurance recoverables $ - $ - $ - $ - $ - Allowance for uncollectible premiums receivable $ 0.4 $ 1.1 $ - $ 0.7 $ 0.8 2014 Allowance for uncollectible reinsurance recoverables $ - $ - $ - $ - $ - Allowance for uncollectible premiums receivable $ 0.5 $ 0.6 $ - $ 0.7 $ 0.4 |
Supplemental Information Concer
Supplemental Information Concerning Insurance Operations | 12 Months Ended |
Dec. 31, 2016 | |
Supplemental Information Concerning Insurance Operations | SCHEDULE VI – Supplemental Information Concerning Insurance Operations ALLEGHANY CORPORATION AND SUBSIDIARIES At December 31, For the Year Ended December 31, Deferred Reserves Discount if Unearned Earned Net Claims and Claim Amortization Paid Claims Premiums Year Line of Business Current Prior ($ in millions) 2016 Property and Casualty Insurance $ 448.6 $ 11,087.2 $ - $ 2,175.5 $ 4,975.8 $ 433.1 $ 3,285.2 $ (368.0) $ 1,253.2 $ 2,600.8 $ 5,091.8 2015 Property and Casualty Insurance $ 419.4 $ 10,779.2 $ - $ 2,076.1 $ 4,230.3 $ 427.6 $ 2,555.3 $ (215.5) $ 1,024.5 $ 2,808.0 $ 4,489.2 2014 Property and Casualty Insurance $ 353.2 $ 11,597.2 $ - $ 1,834.2 $ 4,410.6 $ 448.9 $ 2,709.7 $ (215.2) $ 1,042.0 $ 2,698.9 $ 4,497.5 |
Summary of Significant Accoun31
Summary of Significant Accounting Principles (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Principles of Financial Statement Presentation | (a) Principles of Financial Statement Presentation Alleghany Corporation (“Alleghany”), a Delaware corporation owns and manages certain operating subsidiaries and investments, anchored by a core position in property and casualty reinsurance and insurance. Through its wholly-owned subsidiary Alleghany Insurance Holdings LLC (“AIHL”) and its subsidiaries, Alleghany is engaged in the property and casualty insurance business. AIHL’s insurance operations are principally conducted by its subsidiaries RSUI Group, Inc. (“RSUI”), CapSpecialty, Inc. (“CapSpecialty”) and Pacific Compensation Corporation (“PacificComp”). CapSpecialty has been a subsidiary of AIHL since January 2002, RSUI has been a subsidiary of AIHL since July 2003 and PacificComp has been a subsidiary of AIHL since July 2007. AIHL Re LLC (“AIHL Re”), a captive reinsurance company which provides reinsurance to Alleghany’s insurance operating subsidiaries and affiliates, has been a wholly-owned subsidiary of Alleghany since its formation in May 2006. Alleghany’s reinsurance operations commenced on March 6, 2012 when Alleghany consummated a merger with Transatlantic Holdings, Inc. (“TransRe”) and TransRe became one of Alleghany’s wholly-owned subsidiaries. Although Alleghany’s primary sources of revenues and earnings are its reinsurance and insurance operations and investments, Alleghany also sources, executes, manages and monitors certain private capital investments primarily through its wholly-owned subsidiary Alleghany Capital Corporation (“Alleghany Capital”). Alleghany Capital’s investments are included in other activities for segment reporting purposes and include: • Stranded Oil Resources Corporation (“SORC”), an exploration and production company focused on enhanced oil recovery, headquartered in Golden, Colorado; • Bourn & Koch, Inc. (“Bourn & Koch”), a manufacturer and remanufacturer/retrofitter of precision machine tools and supplier of replacement parts, headquartered in Rockford, Illinois; • 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 • Jazwares, LLC (together with its affiliates, “Jazwares”), a toy and consumer electronics company, headquartered in Sunrise, Florida. The results of IPS have been included in Alleghany’s consolidated results beginning with its acquisition by Alleghany Capital on October 31, 2015. On April 15, 2016, Alleghany Capital acquired an additional 50 percent of Jazwares’ outstanding equity, bringing its equity ownership interest to 80 percent and, as of that date, the results of Jazwares have been included in Alleghany’s consolidated results. Prior to April 15, 2016, Jazwares was accounted for under the equity method of accounting. In addition, Alleghany owns and manages properties in the Sacramento, California region through its wholly-owned subsidiary Alleghany Properties Holdings LLC (“Alleghany Properties”). Alleghany owned an approximately 15 percent equity interest in ORX Exploration, Inc. (“ORX”), a regional oil and gas exploration and production company, until it was sold on December 23, 2016. Alleghany’s public equity investments are managed primarily through Alleghany’s wholly-owned subsidiary Roundwood Asset Management LLC. 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 accumulated other 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 interest. Because all noncontrolling interests have the option to sell their ownership interests to Alleghany in the future (generally through 2023), the portion of stockholders’ equity that is not attributable to Alleghany stockholders is presented on the Consolidated Balance Sheets as redeemable noncontrolling interest for all periods presented. During 2016 and 2015, Bourn & Koch had approximately 11 percent and 12 percent, respectively, noncontrolling interests outstanding, Kentucky Trailer had approximately 20 percent noncontrolling interests outstanding, IPS had approximately 16 percent noncontrolling interests outstanding beginning October 31, 2015 and Jazwares had approximately 20 percent noncontrolling interests outstanding beginning April 15, 2016. 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 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 statement of earnings and comprehensive income in the period in which the changes are made. |
Investments | (b) Investments Investments consist of debt securities, equity securities, short-term investments, commercial mortgage loans and other invested assets. Alleghany considers all of its marketable equity securities, debt securities and short-term investments as available-for-sale AFS securities are recorded at fair value. Unrealized gains and losses during the year, net of the related tax effect, applicable to AFS securities, as well as partnership investments that Alleghany accounts for as AFS, are excluded from earnings and reflected in comprehensive income, and the cumulative effect is reported as a separate component of stockholders’ equity until realized. If a decline in fair value is deemed to be other than temporary, the investment is written down to its fair value and the amount of the write-down is recorded as an other than temporary impairment (“OTTI”) loss on the statement of earnings. In addition, any portion of such decline related to debt securities that is believed to arise from factors other than credit is recorded as a component of other comprehensive income rather than against earnings. Commercial mortgage loans are carried at unpaid principal balance, less allowance for loan losses. The allowance for loan losses is a valuation allowance for incurred credit losses when management believes the uncollectibility of a loan balance is probable. Subsequent recoveries, if any, are credited to the allowance. Interest income on loans is accrued as earned. Other invested assets include invested assets not identified above, primarily related to: (i) equity investments in operating companies where Alleghany has significant influence (an aggregate common stock position held at or above 20 percent is presumed to convey significant influence); (ii) partnership investments (including hedge funds and private equity funds); and (iii) non-marketable Non-marketable Net realized gains and losses on investments are determined in accordance with the specific identification method. Net investment income consists primarily of: (i) interest income from debt securities, short-term investments, commercial mortgage loans, funds withheld by cedants and cash, including any premium amortization or discount accretion; (ii) dividend income from equity securities; and (iii) investment income from other invested assets, which generally includes distributions when receivable and earnings from investments accounted for under the equity method; less expenses related to investments. Interest income is accrued when earned. Premiums and discounts arising from the purchase of certain debt securities are treated as a yield adjustment over the estimated useful life of the securities, adjusted for anticipated prepayments using the retrospective interest method. Under this method, the effective yield on a security is estimated. Such estimates are based on the prepayment terms of the security, past actual cash flows, and assumptions as to future expected cash flow. The future expected cash flow assumptions consider various prepayment assumptions based on historical experience, as well as current market conditions. Periodically, the effective yield is re-estimated re-estimation, See Note 4 for additional information regarding investments. |
Fair value | (c) Fair value Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between willing, able and knowledgeable market participants at the measurement date. Fair value measurements are not adjusted for transaction costs. In addition, a three-tiered hierarchy for inputs is used in management’s determination of fair value of financial instruments that emphasizes the use of observable inputs over the use of unobservable inputs by requiring that the observable inputs be used when available. Observable inputs are market participant assumptions based on market data obtained from sources independent of the reporting entity. Unobservable inputs are the reporting entity’s own assumptions about market participant assumptions based on the best information available under the circumstances. In assessing the appropriateness of using observable inputs in making its fair value determinations, Alleghany considers whether the market for a particular security is “active” or not based on all the relevant facts and circumstances. A market may be considered to be inactive if there are relatively few recent transactions or if there is a significant decrease in market volume. Furthermore, Alleghany considers whether observable transactions are “orderly” or not. Alleghany does not consider a transaction to be orderly if there is evidence of a forced liquidation or other distressed condition; as such, little or no weight is given to that transaction as an indicator of fair value. Although Alleghany is responsible for the determination of the fair value of its 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, Valuation service providers typically obtain data about market transactions and other key valuation model inputs from multiple sources and, through the use of widely accepted internal valuation models, provide a single fair value measurement for individual securities for which a fair value has been requested under the terms of service agreements. The inputs used by the valuation service providers include, but are not limited to, market prices from recently completed transactions and transactions of comparable securities, interest rate yield curves, credit spreads, currency rates and other market observable information, as applicable. The valuation models take into account, among other things, market observable information as of the measurement date as well as the specific attributes of the security being valued including its term, interest rate, credit rating, industry sector and, when applicable, collateral quality and other issue or issuer specific information. When market transactions or other market observable data is limited, the extent to which judgment is applied in determining fair value is greatly increased. The three-tiered hierarchy used in management’s determination of fair value is broken down into three levels based on the reliability of inputs as follows: • Level 1: Valuations are based on unadjusted quoted prices in active markets that Alleghany has the ability to access for identical, unrestricted assets and do not involve any meaningful degree of judgment. An active market is defined as a market where transactions for the financial instrument occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Alleghany’s Level 1 assets include publicly traded common stocks and mutual funds (which are included on the balance sheet in equity securities) where Alleghany’s valuations are based on quoted market prices. • Level 2: Valuations are based on direct and indirect observable inputs other than quoted market prices included in Level 1. Level 2 inputs include quoted prices for similar assets in active markets and inputs other than quoted prices that are observable for the asset, such as the terms of the security and market-based inputs. Terms of the security include coupon, maturity date and any special provisions that may, for example, enable the investor, at its election, to redeem the security prior to its scheduled maturity date (such provisions may apply to all debt securities except U.S. Government obligations). Market-based inputs include interest rates and yield curves that are observable at commonly quoted intervals and current credit rating(s) of the security. Market-based inputs may also include credit spreads of all debt securities except U.S. Government obligations, and currency rates for certain foreign government obligations and foreign corporate bonds denominated in foreign currencies. Fair values are determined using a market approach that relies on the securities’ relationships to quoted prices for similar assets in active markets, as well as the other inputs described above. In determining the fair values for the vast majority of commercial mortgage-backed securities (“CMBS”) and other asset- backed securities, as well as a small portion of residential mortgage-backed securities (“RMBS”), an income approach is used to corroborate and further support the fair values determined by the market approach. The income approach primarily involves developing a discounted cash flow model using the future projected cash flows of the underlying collateral, and the terms of the security. Level 2 assets generally include short-term investments and most debt securities. Alleghany’s Level 2 liabilities consist of the Senior Notes, as defined in Note 1(n). • Level 3: Valuations are based on techniques that use significant inputs that are unobservable. The valuation of Level 3 assets requires the greatest degree of judgment. These measurements may be made under circumstances in which there is little, if any, market activity for the asset. Alleghany’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment. In making the assessment, Alleghany considers factors specific to the asset. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement is classified is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Assets classified as Level 3 principally include certain RMBS, CMBS, other asset-backed securities (primarily, collateralized loan obligations), U.S. corporate bonds, partnership investments and non-marketable Mortgage-backed and asset-backed securities are initially valued at the transaction price. Subsequently, Alleghany uses widely accepted valuation practices that produce a fair value measurement. The vast majority of fair values are determined using an income approach. The income approach primarily involves developing a discounted cash flow model using the future projected cash flows of the underlying collateral, as well as other inputs described below. A few Level 3 valuations are based entirely on non-binding Since Level 3 valuations are based on techniques that use significant inputs that are unobservable with little or no market activity, the fair values under the market approach for Level 3 securities are less credible than under the income approach; however, the market approach, where feasible, is used to corroborate the fair values determined by the income approach. The market approach primarily relies on the securities’ relationships to quoted transaction prices for similarly structured instruments. To the extent that transaction prices for similarly structured instruments are not available for a particular security, other market approaches are used to corroborate the fair values determined by the income approach, including option adjusted spread analyses. Unobservable inputs, significant to the measurement and valuation of mortgage-backed and asset-backed securities, are generally used in the income approach, and include assumptions about prepayment speed and collateral performance, including default, delinquency and loss severity rates. Significant changes to any one of these inputs, or combination of inputs, could significantly change the fair value measurement for these securities. The impact of prepayment speeds on fair value is dependent on a number of variables including whether the securities were purchased at a premium or discount. A decrease in interest rates generally increases the assumed rate of prepayments, and an increase in interest rates generally decreases the assumed speed of prepayments. Increased prepayments increase the yield on securities purchased at a discount and reduce the yield on securities purchased at a premium. In a decreasing prepayment environment, yields on securities purchased at a discount are reduced but are increased for securities purchased at a premium. Changes in default assumptions on underlying collateral are generally accompanied by directionally similar changes in other collateral performance factors, but generally result in a directionally opposite change in prepayment assumptions. Fair values for partnership and non-marketable non-marketable Level 3 liabilities consist of the debt of Alleghany Capital’s operating subsidiaries. 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. In addition to such procedures, Alleghany reviews the reasonableness of its classification of securities within the three-tiered hierarchy to ensure that the classification is consistent with GAAP. See Note 3 for additional information regarding fair value. |
Cash | (d) Cash Cash includes all deposit balances with a bank that are available for immediate withdrawal, whether interest-bearing or non-interest |
Premiums and Unearned Premiums | (e) Premiums and Unearned Premiums Premiums are recognized as revenue on a pro rata basis over the term of an insurance policy. Assumed reinsurance premiums written and earned are based on reports received from ceding companies for pro rata treaty contracts and are generally recorded as written based on contract terms for excess-of-loss Unearned premiums and ceded unearned premiums represent the portion of gross premiums written and ceded premiums written, respectively, relating to the unexpired periods of such coverages. Assumed reinsurance premiums written and earned, along with related costs, for which data has not been reported by the ceding companies, are estimated based on historical patterns and other relevant factors. These estimates may change when actual data for such estimated items becomes available. Premium balances receivable are reported net of an allowance for estimated uncollectible premium amounts. Such allowance is based upon an ongoing review of amounts outstanding, length of collection periods, the creditworthiness of the insured and other relevant factors. Amounts deemed to be uncollectible are written off against the allowance. |
Reinsurance Ceded | (f) Reinsurance Ceded Reinsurance is used to mitigate the exposure to losses, manage capacity and protect capital resources. Reinsuring loss exposures does not relieve a ceding entity from its obligations to policyholders and cedants. Reinsurance recoverables (including amounts related to incurred but not yet reported (“IBNR”) claims) and ceded unearned premiums are reported as assets. To minimize exposure to losses from a reinsurer’s inability to pay, the financial condition of such reinsurer is evaluated initially upon placement of the reinsurance and periodically thereafter. In addition to considering the financial condition of a reinsurer, the collectability of the reinsurance recoverables is evaluated (and where appropriate, whether an allowance for estimated uncollectible reinsurance recoverables is to be established) based upon a number of other factors. Such factors include the amounts outstanding, length of collection periods, disputes, any collateral or letters of credit held and other relevant factors. To the extent that an allowance for uncollectible reinsurance recoverable is established, amounts deemed to be uncollectible are written off against the allowance for estimated uncollectible reinsurance recoverables. Alleghany currently has no allowance for uncollectible reinsurance recoverables. Ceded premiums written are recorded in accordance with the applicable terms of the various reinsurance contracts and ceded premiums earned are charged against revenue over the period of the various reinsurance contracts. This also generally applies to reinstatement premiums paid to a reinsurer, which arise when contractually-specified ceded loss triggers have been breached. Ceded commissions reduce commissions, brokerage and other underwriting expenses and ceded losses incurred reduce net loss and loss adjustment expense (“LAE”) incurred over the applicable periods of the various reinsurance contracts with third-party reinsurers. If premiums or commissions are subject to adjustment (for example, retrospectively-rated or experience-rated), the estimated ultimate premium or commission is recognized over the period of the contract. Amounts recoverable from reinsurers are estimated in a manner consistent with the claim liability associated with the reinsured business and consistent with the terms of the underlying reinsurance contract. See Note 5 for additional information on reinsurance ceded and reinsurance recoverables. |
Deferred Acquisition Costs | (g) Deferred Acquisition Costs Acquisition costs related to unearned premiums that vary with, and are directly related to, the production of such premiums are deferred. Furthermore, such deferred costs: (i) represent only incremental, direct costs associated with the successful acquisition of a new or renewal insurance or reinsurance contract; (ii) are essential to the contract transaction; (iii) would not have been incurred had the contract transaction not occurred; and (iv) are related directly to the acquisition activities involving underwriting, policy issuance and processing. Acquisition costs principally relate to commissions. To a lesser extent, acquisition costs can include premium taxes and certain qualifying underwriting expenses. For insurance policies written, acquisition costs are generally incurred directly and include commissions, premium taxes and certain qualifying underwriting expenses. For reinsurance contracts written, acquisition costs are generally incurred through brokerage commissions and indirectly through ceding commissions, which are deferred. Deferred acquisition costs are amortized to expense as the related premiums are earned, generally over a period of one year. Deferred acquisition costs are reviewed at least annually to determine their recoverability from future income, including investment income. If any such costs are determined not to be recoverable they are charged to expense. Anticipated net loss and LAE and estimated remaining costs of servicing the contracts are considered when evaluating recoverability of deferred acquisition costs. |
Property and Equipment | (h) Property and Equipment Property and equipment is carried at cost, net of accumulated depreciation and amortization. Depreciation of buildings and equipment is principally calculated using the straight-line method over the estimated useful life of the respective assets. Estimated useful lives for such assets range from three to 20 years. Amortization of leasehold improvements is principally calculated using the straight-line method over the estimated useful life of the leasehold improvement or the life of the lease, whichever is less. Rental expense on operating leases is recorded on a straight-line basis over the term of the lease, regardless of the timing of actual lease payments. |
Goodwill and Other Intangible Assets | (i) Goodwill and Other Intangible Assets Goodwill and other intangible assets, net of amortization, are recorded as a consequence of business acquisitions. Goodwill represents the excess, if any, of the amount paid to acquire subsidiaries and other businesses over the fair value of their net assets as of the date of acquisition. Other intangible assets are recorded at their fair value as of the acquisition date. A significant amount of judgment is needed to determine the fair value as of the date of acquisition of other intangible assets and the net assets acquired in a business acquisition. The determination of the fair value of other intangible assets and net assets often involves the use of valuation models and other estimates, which involve many assumptions and variables and are inherently subjective. Other intangible assets that are not deemed to have an indefinite useful life are amortized over their estimated useful lives. Goodwill and intangible assets that have an indefinite useful life are not subject to amortization. Goodwill and other intangible assets deemed to have an indefinite useful life are tested annually in the fourth quarter of every year for impairment. Goodwill and other intangible assets are also tested whenever events and changes in circumstances suggest that the carrying amount may not be recoverable. A significant amount of judgment is required in performing goodwill and other intangible asset impairment tests. These tests may include estimating the fair value of Alleghany’s operating subsidiaries and other intangible assets. If it is determined that an asset has been impaired, the asset is written down by the amount of the impairment, with a corresponding charge to net earnings. Subsequent reversal of any impairment charge is not permitted. With respect to goodwill, a qualitative assessment is first made to determine whether it is necessary to perform quantitative testing. This initial assessment includes, among other factors, consideration of: (i) past, current and projected future earnings and equity; (ii) recent trends and market conditions; and (iii) valuation metrics involving similar companies that are publicly-traded and acquisitions of similar companies, if available. If this initial qualitative assessment indicates that the fair value of an operating subsidiary may be less than its carrying amount, a second step is taken, involving a comparison between the estimated fair value of the operating subsidiary with its respective carrying amount including goodwill. Under GAAP, fair value refers to the amount for which the entire operating subsidiary may be bought or sold. The methods for estimating the fair value of an operating subsidiary values include asset and liability fair values and other valuation techniques, such as discounted cash flows and multiples of earnings or revenues. All of these methods involve significant estimates and assumptions. If the carrying value exceeds estimated fair value, there is an indication of potential impairment, and a third step is performed to measure the amount of impairment. The third step involves calculating an implied fair value of goodwill by measuring the excess of the estimated fair value of the operating subsidiary over the aggregate estimated fair value of the individual assets less liabilities. If the carrying value of goodwill exceeds the implied fair value of goodwill, an impairment charge is recorded for the excess. See Note 2 for additional information on goodwill and other intangible assets. |
Income Taxes | (j) Income Taxes Alleghany files a consolidated federal income tax return with its subsidiaries. Alleghany’s consolidated federal income tax return includes as part of its taxable income all items of income of non-U.S. A valuation allowance is provided when it is more likely than not that some portion of the deferred tax assets will not be realized. This determination is based upon a review of all available information, both positive and negative, including Alleghany’s earnings history, the timing, character and amount of future earnings potential, the reversal of taxable temporary differences and the tax planning strategies available. See Note 9 for additional information on income taxes. |
Loss Reserves | (k) Loss Reserves The reserves for loss and LAE represent management’s best estimate of the ultimate cost of all reported and unreported losses incurred through the balance sheet date. The reserves for loss and LAE include but are not limited to: (i) reports and individual case estimates received from ceding companies with respect to assumed reinsurance business; (ii) the accumulation of individual estimates for claims reported with respect to direct insurance business; (iii) estimates for IBNR claims based on past experience, modified for current trends and industry data; and (iv) estimates of expenses for investigating and settling claims based on past experience. The methods used to determine such estimates and to establish the resulting reserves are continually reviewed and updated. Any adjustments are reflected in current income. Net loss and LAE consist of the estimated ultimate cost of settling claims incurred within the reporting period (net of related reinsurance recoverable), including IBNR claims, plus changes in estimates of prior period losses. The estimation of the liability for unpaid loss and LAE is inherently difficult and subjective, especially in view of changing legal and economic environments that impact loss reserve development and, therefore, quantitative techniques frequently have to be supplemented by subjective considerations and managerial judgment. In addition, trends that have affected development of liabilities in the past may not necessarily occur or affect liability development to the same degree in the future. While the reserving process is difficult for the insurance business, the inherent uncertainties of estimating loss reserves are even greater for the reinsurance business, due primarily to the longer-term nature of most of the business, the diversity of development patterns among different types of reinsurance contracts, the necessary reliance on the ceding companies for information regarding reported claims and differing reserving practices among ceding companies, which may change without notice. TransRe writes a significant amount of non-proportional Each of Alleghany’s reinsurance and insurance subsidiaries establishes reserves on its balance sheet for unpaid loss and LAE related to its property and casualty reinsurance and insurance contracts. As of any balance sheet date, there are claims that have not yet been reported, and some claims may not be reported for many years after the date a loss occurs. As a result of this historical pattern, the liability for unpaid loss and LAE includes significant estimates for IBNR claims. Additionally, reported claims are in various stages of the settlement process. Each claim is settled individually based upon its merits, and certain claims may take years to settle, especially if legal action is involved. As a result, the liabilities for unpaid loss and LAE include significant judgments, assumptions and estimates made by management relating to the actual ultimate losses that will arise from the claims. As noted above, as of any balance sheet date, not all claims that have occurred have been reported to us, and if reported may not have been settled. The time period between the occurrence of a loss and the time it is settled is referred to as the “claim tail.” Reported losses for the shorter-tailed classes, such as property, generally reach the ultimate level of incurred losses in a relatively short period of time and as such, are only relevant for the more recent accident years. Casualty claims can have a very long claim tail, in certain situations extending for many years. In addition, casualty claims are more susceptible to litigation and the legal environment and can be significantly affected by changing contract interpretations, all of which contribute to extending the claim tail. For long-tail casualty lines of business, estimating the ultimate liabilities for unpaid loss and LAE is a more complex process and depends on a number of factors, including the line and volume of the business involved. Alleghany’s loss reserve review processes use actuarial methods that vary by operating subsidiary and line of business and produce point estimates for each class of business. The actuarial methods used include the following methods: • Reported Loss Development Method: • Paid Development Method: • Expected Loss Ratio Method: • Bornhuetter-Ferguson Method: See Note 6 and Note 12(c) for additional information on loss reserves. |
Earnings Per Share of Common Stock Attributable to Alleghany Stockholders | (l) Earnings Per Share of Common Stock Attributable to Alleghany Stockholders Basic earnings per share of common stock is based on the average number of shares of outstanding common stock, par value $1.00 per share, of Alleghany (“Common Stock”) during the period, retroactively adjusted for stock dividends, where applicable. Diluted earnings per share of Common Stock are based on those shares used to calculate basic earnings per share of Common Stock plus the dilutive effect of stock-based compensation awards, retroactively adjusted for stock dividends, where applicable. See Note 11 for additional information on earnings per share. |
Stock-Based Compensation Plans | (m) Stock-Based Compensation Plans The cost resulting from all stock-based compensation transactions is recognized in the financial statements, with fair value as the measurement objective in accounting for stock-based compensation arrangements. The fair value-based measurement method applies in accounting for stock-based compensation transactions with employees. Non-employee |
Senior Notes and Other Debt | (n) Senior Notes and Other Debt Debt consists of senior notes issued by Alleghany (the “Alleghany Senior Notes”), senior notes issued by TransRe (the “TransRe Senior Notes,” and together with the Alleghany Senior Notes, the “Senior Notes”), and other debt. The Senior Notes and other debt are carried at unpaid principal balance including any unamortized premium or discount. See Note 8 for additional information on the Senior Notes and other debt. |
Currency Translation | (o) Currency Translation Assets and liabilities denominated in foreign currencies are translated into U.S. dollars at period-end Transaction gains and losses on assets and liabilities denominated in foreign currencies are recorded as a component of net realized capital gains during the period in which they occur. |
Other Revenues and Other Operating Expenses | (p) Other Revenues and Other Operating Expenses Noninsurance revenues and related operating expenses arising from the sale of manufactured goods and services is generally recognized as the transfer of goods and services to customers takes place. Noninsurance revenues reflect the payment or payments that are expected to be received from the customers for those goods and services. |
Reclassification | (q) Reclassification Certain prior year amounts have been reclassified to conform to the 2016 presentation of the financial statements. |
Recent Accounting Standards | (r) Recent Accounting Standards Recently Adopted In February 2015, the Financial Accounting Standards Board (the “FASB”) issued guidance that amended the analysis that must be performed to determine whether an entity should consolidate certain types of legal entities. Under this guidance, the evaluation of whether limited partnerships and similar entities are variable interest entities or voting interest entities is modified, the presumption that general partners should consolidate limited partnerships is eliminated and the process to determine the primary beneficiary of a variable interest entity is modified. This guidance was effective in the first quarter of 2016. Alleghany adopted this guidance in the first quarter of 2016 and the implementation did not have a material impact on Alleghany’s results of operations and financial condition. In April 2015, the FASB issued guidance that requires debt issuance costs related to debt liabilities be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, which is consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected. This guidance was effective in the first quarter of 2016. Alleghany adopted this guidance on a retrospective basis in the first quarter of 2016 and the implementation resulted in a reduction of other assets and a corresponding decrease in Senior Notes and other debt of approximately $7 million as of March 31, 2016 and December 31, 2015. In May 2015, the FASB issued guidance that requires disclosures related to short-duration insurance contracts. The guidance applies to property and casualty insurance and reinsurance entities, among others, and requires the following annual disclosure related to the liability for loss and LAE: (i) net incurred and paid claims development information by accident year for up to ten years; (ii) a reconciliation of incurred and paid claims development information to the aggregate carrying amount of the liability for loss and LAE; (iii) IBNR liabilities by accident year and in total; (iv) a description of reserving methodologies (as well as any changes to those methodologies); (v) quantitative information about claim frequency by accident year; and (vi) the average annual percentage payout of incurred claims by age by accident year. In addition, the guidance requires insurance entities to disclose for annual and interim reporting periods a roll-forward of the liability for loss and LAE. This guidance is effective for annual periods beginning after December 15, 2015, and interim periods within annual periods beginning after December 15, 2016, with early adoption permitted. Alleghany has adopted this guidance as of December 31, 2016 and the implementation did not have an impact on its results of operations and financial condition. See Note 1(k) and Note 6 for the new disclosures. Future Application of Accounting Standards In May 2014, the FASB, together with the International Accounting Standards Board, issued guidance on the recognition of revenue from contracts with customers. Under this guidance, revenue is recognized as the transfer of goods and services to customers takes place and in amounts that reflect the payment or payments that are expected to be received from the customers for those goods and services. This guidance also requires new disclosures about revenue. Revenues related to insurance and reinsurance are not impacted by this guidance. In July 2015, the FASB determined that it would delay the effective date of the new revenue standard by a year. This guidance is now effective in the first quarter of 2018 for public entities, with early adoption permitted in 2017. Alleghany will adopt this guidance in the first quarter of 2018 and does not currently believe that the implementation will have a material impact on its results of operations and financial condition. In January 2016, the FASB issued guidance that changes the recognition and measurement of certain financial instruments. This guidance requires investments in equity securities (except those accounted for under the equity method of accounting) to be measured at fair value with changes in fair value recognized in net income. For equity securities that do not have readily determinable fair values, measurement may be at cost, adjusted for any impairment and changes resulting from observable price changes for a similar investment of the same issuer. This guidance also changes the presentation and disclosure of financial instruments by: (i) requiring that financial instrument disclosures of fair value use the exit price notion; (ii) requiring separate presentation of financial assets and financial liabilities by measurement category and form, either on the balance sheet or the accompanying notes to the financial statements; (iii) requiring separate presentation in other comprehensive income for the portion of the change in a liability’s fair value resulting from instrument-specific credit risk when an election has been made to measure the liability at fair value; and (iv) eliminating the requirement to disclose the methods and significant assumptions used to estimate the fair value for financial instruments measured at amortized cost on the balance sheet. This guidance is effective for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Except for the change in presentation for instrument-specific credit risk, this guidance does not permit early adoption. Alleghany will adopt this guidance in the first quarter of 2018. As of January 1, 2018, unrealized gains or losses of equity securities, net of deferred taxes, will be reclassified from accumulated other comprehensive income to retained earnings. Subsequently, all changes in unrealized gains or losses of equity securities, net of deferred taxes, will be presented in the consolidated statement of earnings, rather than the consolidated statement of comprehensive income. Alleghany does not currently believe that the implementation will have a material impact on its financial condition. In February 2016, the FASB issued guidance on leases. Under this guidance, a lessee is required to recognize assets and liabilities for leases with terms of more than one year, whereas under current guidance, a lessee is only required to recognize assets and liabilities for those leases qualifying as capital leases. This guidance also requires new disclosures about the amount, timing and uncertainty of cash flows arising from leases. The accounting by lessors is to remain largely unchanged. This guidance is effective in the first quarter of 2019 for public entities, with early adoption permitted. Alleghany will adopt this guidance in the first quarter of 2019 and does not currently believe that the implementation will have a material impact on its results of operations and financial condition. See Note 12(b) for further information on Alleghany’s leases. In June 2016, the FASB issued guidance on credit losses. Under this guidance, a company is required to measure all expected credit losses on loans, reinsurance recoverables and other financial assets accounted for at cost or amortized cost, as applicable. Estimates of expected credit losses are to be based on historical experience, current conditions and reasonable and supportable forecasts. Credit losses for securities accounted for on an AFS basis are to be measured in a manner similar to GAAP as currently applied and cannot exceed the amount by which fair value is less than the amortized cost. Credit losses for all financial assets are to be recorded through an allowance for credit losses. Subsequent reversals in credit loss estimates are permitted and are to be recognized in earnings. This guidance also requires new disclosures about the significant estimates and judgments used in estimating credit losses, as well as the credit quality of financial assets. This guidance is effective in the first quarter of 2020 for public entities, with early adoption permitted. Alleghany will adopt this guidance in the first quarter of 2020 and does not currently believe that the implementation will have a material impact on its results of operations and financial condition. In January 2017, the FASB issued guidance that simplifies the subsequent measurement of goodwill. Under this guidance, if an initial qualitative assessment indicates that the fair value of an operating subsidiary may be less than its carrying amount, an impairment charge is recognized for the amount by which the carrying amount of the operating subsidiary exceeds its estimated fair value. Any resulting impairment loss recognized cannot exceed the total amount of goodwill associated with the operating subsidiary. This guidance is effective in the first quarter of 2020 for public entities. Alleghany will adopt this guidance in the first quarter of 2020 and does not currently believe that the implementation will have a material impact on its results of operations and financial condition. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Asset, Net of Accumulated Amortization Expense on Consolidated Balance Sheets | The amount of goodwill and intangible assets, net of accumulated amortization expense, reported on Alleghany’s consolidated balance sheets as of December 31, 2016 and 2015 were as follows: December 31, 2016 December 31, 2015 Gross Accumulated Net Carrying (1) Gross Accumulated Net Carrying (1) ($ in millions) Insurance Segment (2) $ 49.0 $ - $ 49.0 $ 49.0 $ - $ 49.0 Insurance Segment - Intangible assets: Agency relationships 17.9 9.8 8.1 17.9 9.0 8.9 State insurance licenses 25.8 - 25.8 25.8 - 25.8 Trade name 35.5 - 35.5 35.5 - 35.5 Brokerage and reinsurance relationships 33.8 30.4 3.4 33.8 28.2 5.6 Renewal rights 24.2 24.1 0.1 24.2 24.1 0.1 Other 4.1 4.1 - 4.1 4.1 - Total insurance segment intangibles 141.3 68.4 72.9 141.3 65.4 75.9 Total insurance segment goodwill and $ 190.3 $ 68.4 $ 121.9 $ 190.3 $ 65.4 $ 124.9 Reinsurance Segment (2) Value of business in-force $ 291.4 $ 291.4 $ - $ 291.4 $ 291.4 $ - Loss and LAE reserves (98.8) (72.7) (26.1) (98.8) (65.1) (33.7) State and foreign insurance licenses 19.0 - 19.0 19.0 - 19.0 Trade name 50.0 - 50.0 50.0 - 50.0 Renewal rights 44.0 17.8 26.2 44.0 13.5 30.5 Leases (28.1) (13.8) (14.3) (28.1) (10.9) (17.2) Internally-developed software 10.0 10.0 - 10.0 10.0 - Total reinsurance segment intangibles $ 287.5 $ 232.7 $ 54.8 $ 287.5 $ 238.9 $ 48.6 Other Activities (2)(3) $ 236.0 $ - $ 236.0 $ 92.0 $ - $ 92.0 Other Activities (3) Trade name 126.6 - 126.6 38.9 - 38.9 Licence agreements 66.2 5.9 60.3 - - - Other 84.0 19.9 64.1 53.0 3.6 49.4 Total other activities intangibles 276.8 25.8 251.0 91.9 3.6 88.3 Total other activities goodwill and $ 512.8 $ 25.8 $ 487.0 $ 183.9 $ 3.6 $ 180.3 Alleghany consolidated: Goodwill $ 285.0 $ - $ 285.0 $ 141.0 $ - $ 141.0 Intangible assets 705.6 326.9 378.7 520.7 307.9 212.8 Goodwill and other intangibles assets $ 990.6 $ 326.9 $ 663.7 $ 661.7 $ 307.9 $ 353.8 (1) Goodwill and intangible assets have been reduced by amounts written-down in prior periods. (2) See Note 13 for additional information on Alleghany’s segments of business. (3) Primarily represents goodwill and other intangible assets related to the acquisition of: (i) Jazwares on April 15, 2016; (ii) IPS on October 31, 2015; (iii) Bourn & Koch on April 26, 2012; and (iv) a controlling equity interest in Kentucky Trailer on August 30, 2013. Also reflects minor acquisitions made by Jazwares and Bourn & Koch in 2016 and Kentucky Trailer in 2015 and 2014. |
Fair Value of Financial Instr33
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Carrying Values and Estimated Fair Values of Consolidated Financial Instruments | The carrying values and estimated fair values of Alleghany’s consolidated financial instruments as of December 31, 2016 and 2015 were as follows: December 31, 2016 December 31, 2015 Carrying Value Fair Value Carrying Value Fair Value ($ in millions) Assets Investments (excluding equity method investments and loans) (1) $ 16,899.2 $ 16,899.2 $ 17,007.6 $ 17,007.6 Liabilities Senior Notes and other debt (2) $ 1,476.5 $ 1,584.3 $ 1,419.4 $ 1,525.0 (1) This table includes AFS investments (debt and equity securities, as well as partnership and non-marketable (2) See Note 8 for additional information on the Senior Notes and other debt. |
Financial Instruments Measured at Fair Value and Level of Fair Value Hierarchy of Inputs | Alleghany’s financial instruments measured at fair value and the level of the fair value hierarchy of inputs used as of December 31, 2016 and 2015 were as follows: Level 1 Level 2 Level 3 Total ($ in millions) As of December 31, 2016 Equity securities: Common stock $ 3,105.2 $ - $ 4.3 $ 3,109.5 Preferred stock - - - - Total equity securities 3,105.2 - 4.3 3,109.5 Debt securities: U.S. Government obligations - 1,243.3 - 1,243.3 Municipal bonds - 4,185.8 - 4,185.8 Foreign government obligations - 1,047.1 - 1,047.1 U.S. corporate bonds - 2,120.2 72.9 2,193.1 Foreign corporate bonds - 1,088.4 0.4 1,088.8 Mortgage and asset-backed securities: RMBS (1) - 994.5 5.9 1,000.4 CMBS - 730.5 4.3 734.8 Other asset-backed securities (2) - 586.1 903.8 1,489.9 Total debt securities - 11,995.9 987.3 12,983.2 Short-term investments - 778.4 - 778.4 Other invested assets (3) - - 28.1 28.1 Total investments (excluding equity method investments and loans) $ 3,105.2 $ 12,774.3 $ 1,019.7 $ 16,899.2 Senior Notes and other debt $ - $ 1,491.5 $ 92.8 $ 1,584.3 Level 1 Level 2 Level 3 Total ($ in millions) As of December 31, 2015 Equity securities: Common stock $ 3,001.2 $ 4.7 $ - $ 3,005.9 Preferred stock - - - - Total equity securities 3,001.2 4.7 - 3,005.9 Debt securities: U.S. Government obligations - 1,074.7 - 1,074.7 Municipal bonds - 4,339.6 - 4,339.6 Foreign government obligations - 941.4 - 941.4 U.S. corporate bonds - 2,126.9 49.8 2,176.7 Foreign corporate bonds - 1,230.3 - 1,230.3 Mortgage and asset-backed securities: RMBS (1) - 1,238.5 14.9 1,253.4 CMBS - 1,003.2 20.2 1,023.4 Other asset-backed securities (2) - 613.5 953.0 1,566.5 Total debt securities - 12,568.1 1,037.9 13,606.0 Short-term investments - 365.8 - 365.8 Other invested assets (3) - - 29.9 29.9 Total investments (excluding equity method investments and loans) $ 3,001.2 $ 12,938.6 $ 1,067.8 $ 17,007.6 Senior Notes and other debt $ - $ 1,488.7 $ 36.3 $ 1,525.0 (1) Primarily includes government agency pass-through securities guaranteed by a government agency or government sponsored enterprise, among other types of RMBS. (2) Includes $903.8 million and $946.7 million of collateralized loan obligations as of December 31, 2016 and 2015, respectively. (3) Includes partnership and non-marketable |
Reconciliations of Changes in Level Three Assets Measured at Fair Value | The following tables present reconciliations of the changes during 2016 and 2015 in Level 3 assets measured at fair value: Debt Securities Mortgage and asset-backed Year Ended December 31, 2016 Common U.S. Foreign RMBS CMBS Other Other (1) Total ($ in millions) Balance as of January 1, 2016 $ - $ 49.8 $ - $ 14.9 $ 20.2 $ 953.0 $ 29.9 $ 1,067.8 Net realized/unrealized gains (losses) included in: Net earnings (2) (0.6) (0.3) - 0.3 (0.2) 4.2 4.7 8.1 Other comprehensive income 1.8 0.1 - (0.5) 0.4 27.4 (1.5) 27.7 Purchases 2.2 46.1 0.4 - - 177.0 - 225.7 Sales (0.2) (15.0) (0.2) (7.0) (9.7) (76.8) (4.7) (113.6) Issuances - - - - - - - - Settlements - (6.5) - (1.8) (0.6) (177.5) - (186.4) Transfers into Level 3 1.4 7.3 1.9 - - - - 10.6 Transfers out of Level 3 (0.3) (8.6) (1.7) - (5.8) (3.5) (0.3) (20.2) Balance as of December 31, 2016 $ 4.3 $ 72.9 $ 0.4 $ 5.9 $ 4.3 $ 903.8 $ 28.1 $ 1,019.7 Debt Securities Mortgage and asset-backed Year Ended December 31, 2015 U.S. Foreign RMBS CMBS Other Other (1) Total ($ in millions) Balance as of January 1, 2015 $ 36.7 $ 6.0 $ 18.2 $ 23.3 $ 933.1 $ 24.1 $ 1,041.4 Net realized/unrealized gains (losses) included in: Net earnings (2) (0.6) - 0.6 (0.4) 2.7 1.0 3.3 Other comprehensive income (1.3) 0.8 (1.1) (1.0) (25.9) 0.2 (28.3) Purchases 35.5 - - - 233.3 1.8 270.6 Sales (1.9) (2.0) - - (182.3) (0.7) (186.9) Issuances - - - - - - - Settlements (16.9) - (2.8) (1.7) (7.9) - (29.3) Transfers into Level 3 14.2 0.7 - - - 5.0 19.9 Transfers out of Level 3 (15.9) (5.5) - - - (1.5) (22.9) Balance as of December 31, 2015 $ 49.8 $ - $ 14.9 $ 20.2 $ 953.0 $ 29.9 $ 1,067.8 (1) Includes partnership and non-marketable (2) There were no OTTI losses recorded in net earnings related to Level 3 instruments still held as of December 31, 2016 and 2015. |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Amortized Cost or Cost and Fair Value of Available For Sale Securities | The amortized cost or cost and the fair value of AFS securities as of December 31, 2016 and 2015 are summarized as follows: Amortized Gross Gross Fair Value ($ in millions) As of December 31, 2016 Equity securities: Common stock $ 2,816.6 $ 332.1 $ (39.2) $ 3,109.5 Preferred stock - - - - Total equity securities 2,816.6 332.1 (39.2) 3,109.5 Debt securities: U.S. Government obligations 1,265.7 2.2 (24.6) 1,243.3 Municipal bonds 4,161.0 66.9 (42.1) 4,185.8 Foreign government obligations 1,030.9 20.2 (4.0) 1,047.1 U.S. corporate bonds 2,168.9 43.5 (19.3) 2,193.1 Foreign corporate bonds 1,068.3 27.3 (6.8) 1,088.8 Mortgage and asset-backed securities: RMBS 1,005.9 7.0 (12.5) 1,000.4 CMBS 728.8 9.6 (3.6) 734.8 Other asset-backed securities (1) 1,497.6 4.0 (11.7) 1,489.9 Total debt securities 12,927.1 180.7 (124.6) 12,983.2 Short-term investments 778.4 - - 778.4 Total investments $ 16,522.1 $ 512.8 $ (163.8) $ 16,871.1 Amortized Gross Gross Fair Value ($ in millions) As of December 31, 2015 Equity securities: Common stock $ 2,741.0 $ 351.9 $ (87.0) $ 3,005.9 Preferred stock - - - - Total equity securities 2,741.0 351.9 (87.0) 3,005.9 Debt securities: U.S. Government obligations 1,086.8 1.9 (14.0) 1,074.7 Municipal bonds 4,213.6 134.8 (8.8) 4,339.6 Foreign government obligations 924.1 18.6 (1.3) 941.4 U.S. corporate bonds 2,201.3 23.4 (48.0) 2,176.7 Foreign corporate bonds 1,219.0 24.0 (12.7) 1,230.3 Mortgage and asset-backed securities: RMBS 1,255.1 10.7 (12.4) 1,253.4 CMBS 1,024.8 8.2 (9.6) 1,023.4 Other asset-backed securities (1) 1,605.2 0.3 (39.0) 1,566.5 Total debt securities 13,529.9 221.9 (145.8) 13,606.0 Short-term investments 365.8 - - 365.8 Total investments $ 16,636.7 $ 573.8 $ (232.8) $ 16,977.7 (1) Includes $903.8 million and $946.7 million of collateralized loan obligations as of December 31, 2016 and 2015, respectively. |
Amortized Cost and Estimated Fair Value of Debt Securities by Contractual Maturity | The amortized cost or cost and the estimated fair value of debt securities by contractual maturity as of December 31, 2016 are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Fair Value ($ in millions) Short-term investments due in one year or less $ 778.4 $ 778.4 Mortgage and asset-backed securities (1) 3,232.3 3,225.1 Debt securities with maturity dates: One year or less 428.6 430.8 Over one through five years 3,048.5 3,074.5 Over five through ten years 3,229.1 3,250.7 Over ten years 2,988.6 3,002.1 Total debt securities 12,927.1 12,983.2 Equity securities 2,816.6 3,109.5 Total $ 16,522.1 $ 16,871.1 (1) Mortgage and asset-backed securities by their nature do not generally have single maturity dates. |
Net Investment Income | Net investment income for 2016, 2015 and 2014 was as follows: Year Ended December 31, 2016 2015 2014 ($ in millions) Interest income $ 385.7 $ 376.4 $ 384.4 Dividend income 50.3 54.0 63.0 Investment expenses (26.3) (27.2) (28.8) Equity in results of Pillar Investments (1) 15.8 23.3 22.0 Equity in results of Ares (1) 11.5 6.6 8.6 Equity in results of ORX - (6.3) (3.2) Other investment results 1.5 12.0 13.9 Total $ 438.5 $ 438.8 $ 459.9 (1) See Note 4(h) for discussion of the Pillar Investments and the investment in Ares, each as defined therein. |
Amount of Gross Realized Capital Gains and Gross Realized Capital Losses of Available For Sale Securities | The amount of gross realized capital gains and gross realized capital losses in 2016, 2015 and 2014 were as follows: Year Ended December 31, 2016 2015 2014 ($ in millions) Gross realized capital gains $ 344.7 $ 424.2 $ 301.1 Gross realized capital losses (281.5) (210.3) (54.0) Net realized capital gains $ 63.2 $ 213.9 $ 247.1 |
Gross Unrealized Losses and Related Fair Values for Debt Securities and Equity Securities Grouped by Duration of Time in Continuous Unrealized Loss Position | As of December 31, 2016 and 2015, gross unrealized losses and related fair values for equity securities and debt securities, grouped by duration of time in a continuous unrealized loss position, were as follows: Less Than 12 Months 12 Months or More Total Fair Value Gross Fair Value Gross Fair Value Gross ($ in millions) As of December 31, 2016 Equity securities: Common stock $ 619.4 $ 39.2 $ - $ - $ 619.4 $ 39.2 Preferred stock - - - - - - Total equity securities 619.4 39.2 - - 619.4 39.2 Debt securities: U.S. Government obligations 975.0 24.6 - - 975.0 24.6 Municipal bonds 1,464.5 39.7 41.6 2.4 1,506.1 42.1 Foreign government obligations 238.3 4.0 - - 238.3 4.0 U.S. corporate bonds 727.9 18.1 52.6 1.2 780.5 19.3 Foreign corporate bonds 331.0 6.6 4.1 0.2 335.1 6.8 Mortgage and asset-backed securities: RMBS 652.0 11.4 43.4 1.1 695.4 12.5 CMBS 148.9 1.4 117.7 2.2 266.6 3.6 Other asset-backed securities 334.7 1.6 550.4 10.1 885.1 11.7 Total debt securities 4,872.3 107.4 809.8 17.2 5,682.1 124.6 Total temporarily impaired securities $ 5,491.7 $ 146.6 $ 809.8 $ 17.2 $ 6,301.5 $ 163.8 Less Than 12 Months 12 Months or More Total Fair Value Gross Fair Value Gross Fair Value Gross ($ in millions) As of December 31, 2015 Equity securities: Common stock $ 1,355.6 $ 87.0 $ - $ - $ 1,355.6 $ 87.0 Preferred stock - - - - - - Total equity securities 1,355.6 87.0 - - 1,355.6 87.0 Debt securities: U.S. Government obligations 818.4 13.9 7.9 0.1 826.3 14.0 Municipal bonds 276.2 2.4 108.3 6.4 384.5 8.8 Foreign government obligations 208.5 1.3 - - 208.5 1.3 U.S. corporate bonds 1,149.8 39.0 70.0 9.0 1,219.8 48.0 Foreign corporate bonds 479.9 10.8 12.5 1.9 492.4 12.7 Mortgage and asset-backed securities: RMBS 511.1 6.5 250.6 5.9 761.7 12.4 CMBS 593.1 9.4 15.1 0.2 608.2 9.6 Other asset-backed securities 1,164.8 27.2 265.0 11.8 1,429.8 39.0 Total debt securities 5,201.8 110.5 729.4 35.3 5,931.2 145.8 Total temporarily impaired securities $ 6,557.4 $ 197.5 $ 729.4 $ 35.3 $ 7,286.8 $ 232.8 |
Reinsurance Ceded (Tables)
Reinsurance Ceded (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Reinsurance Recoverables | Amounts recoverable from reinsurers are recognized in a manner consistent with the claims liabilities associated with the reinsurance placement and presented on the balance sheet as reinsurance recoverables. Such balances as of December 31, 2016 and 2015 consisted of the following: As of December 31, 2016 2015 ($ in millions) Reinsurance recoverables on paid losses $ 36.0 $ 80.6 Ceded outstanding loss and LAE 1,236.2 1,169.3 Total $ 1,272.2 $ 1,249.9 |
Information Regarding Concentration of Reinsurance Recoverables and Ratings Profile of its Reinsurers | The following table presents information regarding concentration of Alleghany’s reinsurance recoverables and the ratings profile of its reinsurers as of December 31, 2016: Reinsurer (1) Rating (2) Amount Percentage ($ in millions) Swiss Reinsurance Company A+(Superior) $ 172.1 13.5% PartnerRe Ltd A (Excellent) 116.1 9.1% Syndicates at Lloyd’s of London A (Excellent) 105.0 8.3% Chubb Corporation A++(Superior) 91.4 7.2% RenaissanceRe Holdings Ltd A+(Superior) 91.0 7.2% W.R. Berkley Corporation A+(Superior) 89.9 7.1% Allianz SE A+(Superior) 63.5 5.0% Allied World Assurance Company Holdings, AG (3) A (Excellent) 60.5 4.8% Hannover Ruck SE A+(Superior) 46.9 3.7% Fairfax Financial Holdings Ltd (3) A (Excellent) 43.6 3.4% All other reinsurers 392.2 30.7% Total reinsurance recoverables (4) $ 1,272.2 100.0% Secured reinsurance recoverables (5) $ 183.3 14.4% (1) Reinsurance recoverables reflect amounts due from one or more reinsurance subsidiaries of the listed company. (2) Represents the A.M. Best financial strength rating for the applicable reinsurance subsidiary or subsidiaries from which the reinsurance recoverable is due. (3) In December 2016, Fairfax Financial Holdings Ltd announced its agreement to acquire Allied World Assurance Company Holdings, AG. (4) Approximately 94 percent of our reinsurance recoverables balance as of December 31, 2016 was due from reinsurers having an A.M. Best financial strength rating of A (Excellent) or higher. (5) Represents reinsurance recoverables secured by funds held, trust agreements and letters of credit. |
Property and Casualty Premiums Written and Earned | The following table presents property and casualty premiums written and earned for 2016, 2015 and 2014: Year Ended December 31, 2016 2015 2014 ($ in millions) Gross premiums written – direct $ 1,490.3 $ 1,505.6 $ 1,529.4 Gross premiums written – assumed 4,276.8 3,616.6 3,567.2 Ceded premiums written (675.3) (633.0) (599.1) Net premiums written $ 5,091.8 $ 4,489.2 $ 4,497.5 Gross premiums earned – direct $ 1,871.1 $ 1,515.9 $ 1,517.0 Gross premiums earned – assumed 3,833.9 3,403.3 3,540.5 Ceded premiums earned (729.2) (688.9) (646.9) Net premiums earned $ 4,975.8 $ 4,230.3 $ 4,410.6 |
Liability for Loss and LAE (Tab
Liability for Loss and LAE (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Activity in Liability for Loss and Loss Adjustment Expense | Activity in liability for loss and LAE in 2016, 2015 and 2014 is summarized as follows: Year Ended December 31, 2016 2015 2014 ($ in millions) Reserves as of January 1 $ 10,799.2 $ 11,597.2 $ 11,952.5 Less: reinsurance recoverables (1) 1,169.3 1,289.4 1,302.1 Net reserves as of January 1 9,629.9 10,307.8 10,650.4 Other adjustments 2.4 (1.9) 56.9 (2 ) Incurred loss and LAE, net of reinsurance, related to: Current year 3,285.2 2,555.3 2,709.7 Prior years (368.0) (215.5) (215.2) Total incurred loss and LAE, net of reinsurance 2,917.2 2,339.8 2,494.5 Paid loss and LAE, net of reinsurance, related to: (3) Current year 734.3 417.6 520.8 Prior years 1,866.5 2,390.4 2,178.1 Total paid loss and LAE, net of reinsurance 2,600.8 2,808.0 2,698.9 Foreign exchange effect (97.7) (207.8) (195.1) Net reserves as of December 31 9,851.0 9,629.9 10,307.8 Reinsurance recoverables as of December 31 (1) 1,236.2 1,169.3 1,289.4 Reserves as of December 31 $ 11,087.2 $ 10,799.2 $ 11,597.2 (1) Reinsurance recoverables in this table include only ceded loss and LAE reserves. (2) Represents reserves acquired in connection with a loss portfolio transfer transaction. (3) Includes paid losses, net of reinsurance, related to commutations. |
(Favorable) Unfavorable Prior Accident Year Loss Reserve Development | The (favorable) unfavorable prior accident year loss reserve development for 2016, 2015 and 2014 is summarized as follows: Year Ended December 31, 2016 2015 2014 ($ in millions) Reinsurance Segment: Property: Catastrophe events $ (14.2) (1) $ (28.0) (2) $ (17.3) (3) Non-catastrophe (91.5) (4) (48.7) (5) (55.8) (6) Total property (105.7) (76.7) (73.1) Casualty & other: Malpractice treaties (7) (10.8) (12.1) (12.7) Commuted A&E Liabilities (8) - 38.2 - Other (177.0) (9) (157.7) (10) (96.6) (11) Total casualty & other (187.8) (131.6) (109.3) Total Reinsurance Segment (293.5) (208.3) (182.4) Insurance Segment: RSUI: Casualty (35.3) (12) (2.9) (13) (30.1) (14) Property and other (33.0) (15) (9.0) (16) (5.3) (17) Total RSUI (68.3) (11.9) (35.4) CapSpecialty: Ongoing lines of business (0.3) 11.0 ( 18) 0.2 Terminated Program (19) (1.9) (6.3) - Asbestos-related illness and environmental impairment liability (2.0) - - Total CapSpecialty (4.2) 4.7 0.2 PacificComp (2.0) (20) - 2.4 ( 21) Total incurred related to prior years $ (368.0) $ (215.5) $ (215.2) (1) Reflects favorable prior accident year loss reserve development from several catastrophes that occurred in the 2010 through 2015 accident years. (2) Includes favorable prior accident year loss reserve development of ($27.7) million from Super Storm Sandy in 2012 and various smaller amounts on catastrophes that occurred in the 2010, 2011, 2013 and 2014 accident years, partially offset by unfavorable prior accident year development from the New Zealand earthquake in 2010. (3) Includes favorable prior accident year loss reserve development of ($1.6) million from Super Storm Sandy in 2012 and ($15.7) million of net favorable prior accident year loss reserve development from other catastrophes. The ($15.7) million primarily reflects favorable prior accident year loss reserve development from several catastrophes that occurred primarily in the 2011 and 2013 accident years, partially offset by unfavorable prior accident year loss reserve development from the New Zealand earthquake in 2010. (4) Reflects favorable prior accident year loss reserve development primarily related to the 2011 and 2015 accident years. (5) Reflects favorable prior accident year loss reserve development primarily related to the 2013 and 2014 accident years. (6) Reflects favorable prior accident year loss reserve development primarily related to the 2012 accident year and, to a lesser extent, the 2011 accident year. (7) Represents certain medical malpractice treaties pursuant to which the increased underwriting profits created by the favorable prior accident year loss reserve development are largely retained by the cedants. As a result, the favorable prior accident year development is largely offset by an increase in profit commission expense incurred when such favorable prior accident year loss reserve development occurs. (8) Represents unfavorable prior accident year loss reserve development related to a commutation and release agreement entered into on November 30, 2015 by TransRe with AIG Property Casualty, Inc., National Indemnity Company and Resolute Management, Inc. with respect to certain reinsurance contracts (the “Commutation Agreement”), including contracts covering asbestos-related illness and environmental impairment liabilities for 1986 and prior years (the “Commuted A&E Liabilities”). (9) Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2003 through 2015 accident years. (10) Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2005 through 2014 accident years, including ($30.7) million of favorable prior accident year development related to French medical malpractice loss reserves commuted in the fourth quarter of 2015 with a European cedant, partially offset by unfavorable prior accident year development from the 2004 and prior accident years. (11) Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2003 through 2007 and 2010 through 2011 accident years, partially offset by unfavorable prior accident year loss reserve development from the 2013 accident year and the 2002 and prior accident years. (12) Primarily reflects favorable prior accident year loss reserve development in the umbrella/excess, general liability and professional liability lines of business related to the 2006 through 2012 accident years. (13) Primarily reflects favorable prior accident year loss reserve development in the umbrella/excess, general liability and professional liability lines of business related to the 2006 through 2011 accident years, partially offset by unfavorable prior accident year loss reserve development in the directors’ and officers’ liability lines of business related to the 2011 through 2014 accident years. (14) Primarily reflects favorable prior accident year loss reserve development in the professional liability, general liability and umbrella/excess lines of business, and primarily related to the 2006 through 2010 accident years, partially offset by unfavorable prior accident year loss reserve development in the directors’ and officers’ liability lines of business in the 2011 and 2012 accident years. (15) Includes favorable prior accident year loss reserve development of ($20.6) million from Super Storm Sandy in 2012 and various other smaller amounts primarily from the non-catastrophe property lines of business in recent accident years. (16) Primarily reflects favorable prior accident year development of ($4.1) million from Super Storm Sandy in 2012, net of reinsurance, and favorable prior accident year loss reserve development related to unallocated LAE reserves. (17) Primarily reflects favorable prior accident year development on unallocated LAE reserves and prior year catastrophe loss reserves from recent accident years. (18) Primarily reflects unfavorable prior accident year loss reserve development related to the casualty lines of business from the 2011 through 2013 accident years. (19) Represents certain specialty lines of business written through a program administrator in connection with a terminated program related to the 2010 and 2009 accident years and reflects (favorable) loss emergence compared with loss emergence patterns assumed in earlier periods for such business. (20) Primarily reflects favorable prior accident year loss reserve development related to 2012 and prior accident years. (21) Primarily reflects unfavorable prior accident year loss reserve development related to 2009 and prior accident years. |
Loss and LAE Reserve Summary and Reconciliation to Consolidated Balance Sheet | Loss and LAE Reserve Summary and Reconciliation to Consolidated Balance Sheet Unpaid loss and LAE as of December 31, 2016 (1) Gross Loss and Reinsurance Net Loss and ($ in millions) Reinsurance Segment Property $ 952.7 $ (106.7) $ 846.0 Casualty & other 7,324.4 (226.0) 7,098.4 8,277.1 (332.7) 7,944.4 Insurance Segment RSUI - Property 395.3 (186.8) 208.5 RSUI - Casualty 1,981.0 (752.0) 1,229.0 RSUI 2,376.3 (938.8) 1,437.5 CapSpecialty 267.8 (31.4) 236.4 PacificComp 234.5 (1.8) 232.7 2,878.6 (972.0) 1,906.6 Eliminations (68.5) 68.5 – Total $ 11,087.2 $ (1,236.2) $ 9,851.0 (1) Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. |
Average Historical Loss and LAE Duration | The following is supplemental information about average historical loss and LAE duration, net of reinsurance, as of December 31, 2016. Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance As of December 31, 2016 Years 1 2 3 4 5 6 7 8 9 10 Reinsurance Segment: Property 28.6% 37.2% 16.6% 7.8% 3.8% 1.9% 1.4% (0.1%) 0.2% 0.0% Casualty & other 19.9% 17.3% 11.9% 10.0% 7.9% 6.8% 5.5% 4.1% 3.5% 2.0% Insurance Segment: RSUI - Property 40.1% 31.3% 10.3% 6.1% 3.4% 0.6% 0.9% 1.0% 0.2% 0.2% RSUI - Casualty 3.4% 13.5% 20.2% 13.9% 12.5% 8.3% 3.3% 3.4% 3.4% 0.7% CapSpecialty 25.9% 23.8% 16.2% 14.0% 9.2% 5.1% 2.0% 1.2% 1.2% 0.1% PacificComp 16.5% 19.8% 16.8% 11.8% 7.5% 7.7% 3.9% 3.7% 2.6% 1.8% |
Reinsurance Segment | Property | |
Supplemental Information About Incurred and Paid Loss and LAE Development and Reconciliation to Consolidated Balance Sheet | Reinsurance Segment - Property Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 IBNR ($ in millions) 2007 $ 508.3 $ 437.5 $ 426.4 $ 423.8 $ 420.9 $ 419.6 $ 418.4 $ 416.7 $ 415.8 $ 415.3 $ - 2008 645.0 508.0 510.9 515.9 511.9 510.9 509.4 508.7 508.8 - 2009 489.3 377.4 359.7 358.0 357.1 357.6 355.9 353.7 - 2010 615.6 527.1 528.0 540.4 581.2 606.0 609.9 25.4 2011 1,351.2 1,342.3 1,269.4 1,240.7 1,235.2 1,217.1 9.6 2012 697.2 579.1 530.3 495.6 478.1 21.3 2013 501.2 470.6 444.6 422.1 21.1 2014 496.4 464.8 451.3 37.4 2015 368.8 332.0 59.7 2016 684.1 262.2 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 5,472.4 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 ($ in millions) 2007 $ 128.4 $ 306.2 $ 362.8 $ 393.8 $ 402.7 $ 407.5 $ 409.8 $ 410.0 $ 411.0 $ 411.0 2008 163.3 350.8 435.2 477.1 495.0 501.5 503.1 505.0 505.6 2009 114.7 251.7 310.9 332.4 340.6 345.5 347.9 345.7 2010 169.3 349.0 418.9 472.3 513.5 540.1 563.7 2011 407.8 796.4 1,014.3 1,129.2 1,171.0 1,187.2 2012 90.3 268.9 377.8 416.7 438.0 2013 113.1 277.4 361.0 389.8 2014 109.4 297.6 360.0 2015 96.0 217.7 2016 210.5 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 4,629.2 Total incurred loss and LAE for the 2007 through 2016 accident years $ 5,472.4 Cumulative paid loss and LAE for the 2007 through 2016 accident years 4,629.2 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 2.8 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 846.0 |
Reinsurance Segment | Casualty & Other | |
Supplemental Information About Incurred and Paid Loss and LAE Development and Reconciliation to Consolidated Balance Sheet | Reinsurance Segment - Casualty & Other Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of Accident Year 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 IBNR ($ in millions) 2007 $ 2,043.1 $ 2,024.0 $ 2,038.1 $ 2,033.2 $ 2,014.2 $ 1,998.4 $ 1,990.2 $ 1,953.8 $ 1,938.0 $ 1,928.4 $ 122.3 2008 2,262.7 2,301.0 2,311.8 2,294.4 2,313.3 2,323.3 2,324.8 2,304.4 2,293.5 154.3 2009 2,228.9 2,188.7 2,177.5 2,168.7 2,165.9 2,171.6 2,193.4 2,186.0 170.0 2010 2,123.1 2,108.9 2,076.5 2,041.8 1,982.7 1,953.2 1,927.9 245.5 2011 2,027.2 2,033.2 2,002.2 1,967.5 1,932.1 1,913.6 283.7 2012 1,899.8 1,937.4 1,932.7 1,866.3 1,817.0 364.2 2013 1,649.3 1,671.0 1,637.6 1,600.9 453.7 2014 1,652.2 1,624.0 1,603.1 603.6 2015 1,558.2 1,567.7 789.4 2016 1,894.7 1,295.2 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 18,732.8 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident Year 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 ($ in millions) 2007 $ 354.0 $ 721.7 $ 912.8 $ 1,137.3 $ 1,282.4 $ 1,402.1 $ 1,495.0 $ 1,572.8 $ 1,657.3 $ 1,695.4 2008 452.8 853.4 1,137.0 1,337.2 1,515.3 1,676.2 1,809.2 1,912.0 1,972.5 2009 482.0 850.2 1,089.8 1,285.3 1,445.2 1,597.3 1,749.2 1,828.7 2010 438.8 779.7 985.0 1,154.9 1,305.4 1,458.7 1,541.8 2011 406.1 695.8 959.1 1,194.3 1,360.6 1,475.3 2012 401.7 721.3 941.1 1,109.3 1,264.1 2013 287.6 608.6 789.9 959.3 2014 281.0 528.6 752.8 2015 250.7 509.5 2016 402.1 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 12,401.5 Total incurred loss and LAE for the 2007 through 2016 accident years $ 18,732.8 Cumulative paid loss and LAE for the 2007 through 2016 accident years 12,401.5 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 767.1 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 7,098.4 |
Insurance Segment | Pacific Comp | |
Supplemental Information About Incurred and Paid Loss and LAE Development and Reconciliation to Consolidated Balance Sheet | Insurance Segment - PacificComp Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of December 31, 2016 Accident 2007 (unaudited) 2008 (unaudited) 2009 (unaudited) 2010 (unaudited) 2011 (unaudited) 2012 (unaudited) 2013 (unaudited) 2014 (unaudited) 2015 (unaudited) 2016 IBNR Cumulative (1) ($ in millions, except reported claims) 2007 $ 90.9 $ 105.6 $ 112.4 $ 113.8 $ 116.8 $ 118.7 $ 121.7 $ 122.8 $ 123.4 $ 123.0 $ 4.5 8,449 2008 79.1 90.0 100.6 107.3 108.3 110.8 110.9 109.9 109.1 5.7 5,789 2009 58.2 61.0 74.5 75.8 80.2 82.0 82.0 83.0 4.3 3,013 2010 4.1 5.1 5.4 5.7 6.0 6.0 5.8 0.5 211 2011 2.8 2.8 3.0 3.0 3.0 2.8 0.3 100 2012 14.5 15.1 15.1 15.1 14.7 2.0 560 2013 31.0 30.4 30.4 29.3 5.7 1,005 2014 52.6 52.6 53.5 8.1 2,218 2015 76.6 76.8 25.4 3,362 2016 104.8 47.2 4,302 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 602.8 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident 2007 (unaudited) 2008 (unaudited) 2009 (unaudited) 2010 (unaudited) 2011 (unaudited) 2012 (unaudited) 2013 (unaudited) 2014 (unaudited) 2015 (unaudited) 2016 ($ in millions) 2007 $ 17.9 $ 39.7 $ 59.2 $ 74.7 $ 85.9 $ 92.9 $ 97.8 $ 103.1 $ 106.8 $ 108.9 2008 15.5 35.6 55.3 69.2 78.6 85.8 91.2 94.6 97.2 2009 12.0 28.0 41.1 50.8 58.3 64.7 68.6 71.7 2010 1.4 2.7 3.4 4.0 4.5 4.8 4.9 2011 0.6 1.1 1.7 2.0 2.1 2.5 2012 2.4 5.6 8.2 10.0 11.0 2013 4.7 10.1 15.4 18.4 2014 8.8 20.8 30.1 2015 10.4 24.9 2016 15.6 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 385.2 Total incurred loss and LAE for the 2007 through 2016 accident years $ 602.8 Cumulative paid loss and LAE for the 2007 through 2016 accident years 385.2 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 15.1 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 232.7 (1) Represents claims reported by insured claimants. |
Insurance Segment | CapSpecialty Incorporated | |
Supplemental Information About Incurred and Paid Loss and LAE Development and Reconciliation to Consolidated Balance Sheet | Insurance Segment - CapSpecialty (1) Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of December 31, 2016 Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 IBNR Cumulative (2) ($ in millions, except reported claims) 2007 $ 110.2 $ 107.8 $ 103.6 $ 108.4 $ 109.2 $ 109.9 $ 109.3 $ 109.7 $ 107.9 $ 107.2 $ 1.1 11,028 2008 102.6 97.1 93.2 90.1 89.6 94.3 94.2 96.5 96.8 0.5 8,835 2009 92.2 93.3 90.4 95.7 98.8 99.0 97.9 98.0 0.7 8,527 2010 93.2 110.8 117.9 134.8 134.5 129.8 129.5 3.0 8,205 2011 74.0 71.2 74.4 76.9 79.4 78.4 2.5 5,682 2012 72.7 71.8 66.2 69.3 69.7 2.7 5,250 2013 78.7 81.4 85.2 84.4 4.6 5,106 2014 102.8 102.7 101.0 14.4 5,772 2015 111.0 111.8 34.1 5,193 2016 129.4 78.0 4,628 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 1,006.2 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 ($ in millions) 2007 $ 30.7 $ 56.4 $ 74.9 $ 91.1 $ 99.3 $ 104.2 $ 105.7 $ 106.8 $ 107.8 $ 107.9 2008 26.3 43.8 63.9 74.6 82.4 87.2 90.3 91.7 93.1 2009 27.7 50.1 62.5 78.2 87.2 92.7 94.4 95.7 2010 22.0 56.2 78.4 98.1 111.0 119.2 121.6 2011 16.3 31.9 44.7 57.7 67.3 69.8 2012 18.6 38.6 46.9 57.2 63.3 2013 23.4 48.0 62.0 69.6 2014 34.0 56.3 71.9 2015 30.9 57.4 2016 30.3 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 780.6 Total incurred loss and LAE for the 2007 through 2016 accident years $ 1,006.2 Cumulative paid loss and LAE for the 2007 through 2016 accident years 780.6 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 10.8 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 236.4 (1) The vast majority of the CapSpecialty’s loss and LAE reserves relate to its casualty lines of business. (2) Represents claims reported by insured claimants. |
Property Insurance | Insurance Segment | RSUI | |
Supplemental Information About Incurred and Paid Loss and LAE Development and Reconciliation to Consolidated Balance Sheet | Insurance Segment - RSUI - Property Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of December 31, 2016 Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 IBNR Cumulative (1) ($ in millions, except reported claims) 2007 $ 69.2 $ 67.8 $ 66.9 $ 64.2 $ 64.7 $ 64.5 $ 64.8 $ 65.8 $ 65.8 $ 65.8 $ 0.6 1,192 2008 176.0 181.3 178.2 183.8 193.3 192.8 192.2 192.4 192.5 0.8 1,839 2009 78.3 63.1 60.1 62.5 63.1 63.7 64.5 64.7 0.9 1,313 2010 110.2 101.7 101.8 105.7 104.2 109.8 109.9 1.1 1,630 2011 168.8 162.0 160.5 159.9 159.0 159.3 1.5 2,202 2012 270.9 262.5 258.6 256.1 235.1 6.6 2,309 2013 157.3 157.2 150.4 152.1 3.1 2,387 2014 170.7 166.2 155.9 6.7 3,079 2015 140.5 136.1 11.8 2,958 2016 181.4 49.0 2,944 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 1,452.8 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 ($ in millions) 2007 $ 24.7 $ 47.0 $ 58.5 $ 61.4 $ 62.9 $ 63.1 $ 63.4 $ 64.9 $ 65.0 $ 65.1 2008 65.3 138.8 155.3 173.1 187.6 189.0 190.6 191.2 191.6 2009 36.6 51.0 54.3 58.9 61.4 61.9 63.3 63.6 2010 53.0 83.6 92.4 98.6 100.6 101.1 101.5 2011 61.0 118.4 144.0 154.3 156.1 157.2 2012 62.0 157.5 181.9 193.5 202.4 2013 72.7 118.7 134.0 141.1 2014 93.2 133.8 145.0 2015 70.8 106.9 2016 72.0 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 1,246.4 Total incurred loss and LAE for the 2007 through 2016 accident years $ 1,452.8 Cumulative paid loss and LAE for the 2007 through 2016 accident years 1,246.4 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 2.1 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 208.5 (1) Represents claims reported by insured claimants. |
Casualty Insurance | Insurance Segment | RSUI | |
Supplemental Information About Incurred and Paid Loss and LAE Development and Reconciliation to Consolidated Balance Sheet | Insurance Segment - RSUI - Casualty Incurred Loss and LAE, Net of Reinsurance Year Ended December 31, As of December 31, 2016 Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 IBNR Cumulative (1) ($ in millions, except reported claims) 2007 $ 252.8 $ 257.6 $ 253.6 $ 252.2 $ 243.9 $ 232.6 $ 225.7 $ 215.5 $ 206.4 $ 201.7 $ 22.1 5,992 2008 255.0 255.0 260.6 254.8 245.3 237.0 230.8 220.9 216.9 27.5 7,105 2009 230.1 233.7 234.4 236.3 236.3 232.2 221.8 212.0 34.8 6,843 2010 204.1 204.1 204.1 203.4 194.6 178.6 177.0 28.9 6,859 2011 205.9 205.9 208.3 212.1 211.6 206.8 45.3 7,459 2012 226.3 226.3 230.3 242.8 238.9 72.6 7,518 2013 264.8 264.8 277.6 280.1 99.4 8,503 2014 292.0 322.7 321.1 144.3 9,870 2015 300.2 300.2 207.6 8,661 2016 290.7 252.2 7,156 Total Incurred Loss and LAE for the 2007 through 2016 accident years $ 2,445.4 Paid Loss and LAE, Net of Reinsurance Year Ended December 31, Accident 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 ($ in millions) 2007 $ 4.1 $ 24.2 $ 63.0 $ 88.9 $ 117.4 $ 151.4 $ 158.8 $ 164.2 $ 170.5 $ 171.9 2008 9.5 35.1 89.5 124.4 145.3 157.4 164.2 171.3 179.4 2009 7.2 38.0 73.2 101.9 136.9 149.5 157.5 166.4 2010 4.7 30.9 70.1 90.1 122.6 128.6 132.9 2011 6.5 31.9 66.7 100.3 118.4 138.5 2012 6.8 38.4 96.0 125.5 144.0 2013 10.1 50.0 103.4 146.2 2014 13.0 69.5 130.1 2015 9.0 47.3 2016 13.7 Cumulative Paid Loss and LAE for the 2007 through 2016 accident years $ 1,270.4 Total incurred loss and LAE for the 2007 through 2016 accident years $ 2,445.4 Cumulative paid loss and LAE for the 2007 through 2016 accident years 1,270.4 Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 54.0 Unpaid loss and LAE, net of reinsurance recoverables, as of December 31, 2016 $ 1,229.0 (1) Represents claims reported by insured claimants. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Expense (Benefit) | Income tax expense (benefit) consisted of the following: Federal State Foreign Total ($ in millions) Year ended December 31, 2016 Current $ 49.4 $ 4.9 $ 23.4 $ 77.7 Deferred 109.6 0.3 (0.5) 109.4 $ 159.0 $ 5.2 $ 22.9 $ 187.1 Year ended December 31, 2015 Current $ 93.3 $ 3.1 $ 50.0 $ 146.4 Deferred 49.2 (0.4) - 48.8 $ 142.5 $ 2.7 $ 50.0 $ 195.2 Year ended December 31, 2014 Current $ 115.4 $ 4.9 $ 118.2 $ 238.5 Deferred 12.9 0.4 - 13.3 $ 128.3 $ 5.3 $ 118.2 $ 251.8 |
Difference between Federal Income Tax Rate and Effective Income Tax Rate | The difference between the federal income tax rate and the effective income tax rate was as follows: Year Ended December 31, 2016 2015 2014 Federal income tax rate 35.0% 35.0% 35.0% Foreign tax credits (0.6) (0.4) - Income subject to dividends-received deduction (1.6) (1.6) (1.3) Tax-exempt (6.5) (6.8) (6.5) State taxes, net of federal tax benefit 0.6 0.2 0.4 Prior period adjustment 2.4 (0.2) 0.1 Other, net (0.4) (0.4) (0.7) Effective tax rate 28.9% 25.8% 27.0% |
Tax Effects of Temporary Differences that Give Rise to Significant Portions of Deferred Tax Assets and Deferred Tax Liabilities | The tax effects of temporary differences that give rise to the deferred tax assets and deferred tax liabilities as of December 31, 2016 and 2015 are as follows: As of December 31, 2016 2015 ($ in millions) Deferred tax assets: Loss and LAE reserves $ 212.1 $ 242.7 Minimum tax credit carry forward 28.9 110.2 Compensation accruals 166.7 161.9 Unearned premiums 139.1 134.0 OTTI losses 19.5 21.9 State net operating loss carry forward 25.2 17.9 Other 173.3 167.2 Gross deferred tax assets before valuation allowance 764.8 855.8 Valuation allowance (25.2) (17.9) Gross deferred tax assets 739.6 837.9 Deferred tax liabilities: Net unrealized gains on investments 125.8 120.8 Deferred acquisition costs 163.3 146.8 Purchase accounting adjustments 30.2 43.8 Other 65.4 58.1 Gross deferred tax liabilities 384.7 369.5 Net deferred tax assets $ 354.9 $ 468.4 |
Tax Year Returns that Remain Subject to Examination by Major Tax Jurisdiction | The following table lists the tax years of Alleghany and TransRe tax returns that remain subject to examination by major tax jurisdictions as of December 31, 2016. Major Tax Jurisdiction Open Tax Years Australia 2012-2015 Canada 2012-2015 France 2009, 2010 and 2013-2015 Germany 2013-2015 Hong Kong 2014-2015 Japan 2010-2015 Singapore 2014-2016 Switzerland 2015 U.K. 2014-2015 U.S. 2007-2015 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Schedule of Common Stock Repurchases | Pursuant to the 2012 Repurchase Program, 2014 Repurchase Program and the 2015 Repurchase Program, as applicable, Alleghany repurchased shares of Common Stock in 2016, 2015 and 2014 as follows: Year Ended December 31, 2016 2015 2014 Shares repurchased 142,186 520,466 732,391 Cost of shares repurchased (in millions) $ 68.3 $ 243.8 $ 300.5 Average price per share repurchased $ 480.49 $ 468.45 $ 410.27 |
Reconciliation of Accumulated Other Comprehensive Income | The following table presents a reconciliation of the changes during 2016 and 2015 in accumulated other comprehensive income attributable to Alleghany stockholders: Unrealized Unrealized Retirement Total ($ in millions) Balance as of January 1, 2016 $ 231.9 $ (104.0) $ (11.6) $ 116.3 Other comprehensive income (loss), net of tax: Other comprehensive income (loss) before reclassifications 67.7 (7.2) (0.1) 60.4 Reclassifications from accumulated other comprehensive income (67.4) - - (67.4) Total 0.3 (7.2) (0.1) (7.0) Balance as of December 31, 2016 $ 232.2 $ (111.2) $ (11.7) $ 109.3 Unrealized Unrealized Retirement Total ($ in millions) Balance as of January 1, 2015 $ 455.4 $ (89.2) $ (12.6) $ 353.6 Other comprehensive income (loss), net of tax: Other comprehensive income (loss) before reclassifications (154.8) (14.8) 1.0 (168.6) Reclassifications from accumulated other comprehensive income (68.7) - - (68.7) Total (223.5) (14.8) 1.0 (237.3) Balance as of December 31, 2015 $ 231.9 $ (104.0) $ (11.6) $ 116.3 |
Reclassifications of Accumulated Other Comprehensive Income | Reclassifications out of accumulated other comprehensive income attributable to Alleghany stockholders during 2016 and 2015 were as follows: Accumulated Other Comprehensive Income Component Line in Consolidated Statement of Earnings Year Ended December 31, 2016 2015 ($ in millions) Unrealized appreciation of investments: Net realized capital gains (1) $ (148.8) $ (239.7) Other than temporary impairment losses 45.2 133.9 Income taxes 36.2 37.1 Total reclassifications: Net earnings $ (67.4) $ (68.7) (1) For 2016, excludes a ($98.8) million impairment charge from a write-down of certain SORC assets and the Jazwares Remeasurement Gain of $13.2 million. For 2015, excludes a ($25.8) million realized capital loss related to an impairment charge related to a write-off |
Summary of Dividends Paid to Alleghany by its reinsurance and insurance subsidiaries | A summary of dividends paid to Alleghany by its reinsurance and insurance subsidiaries in 2016, 2015 and 2014 follows: Year Ended December 31, 2016 2015 2014 ($ in millions) TransRe (1) $ 375.0 $ 250.0 $ 300.0 RSUI 100.0 150.0 225.0 Total $ 475.0 $ 400.0 $ 525.0 (1) In 2016, 2015 and 2014, TRC paid dividends of $350.0 million, $400.0 million and $400.0 million, respectively, to the TransRe holding company. |
Earnings Per Share of Common 39
Earnings Per Share of Common Stock (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Reconciliation of Earnings and Share Data used in Basic and Diluted Earnings per Share Computations | The following is a reconciliation of the earnings and share data used in the basic and diluted earnings per share computations for 2016, 2015 and 2014: Year Ended December 31, 2016 2015 2014 ($ in millions, except share amounts) Net earnings available to Alleghany stockholders $ 456.9 $ 560.3 $ 679.2 Adjustment related to redeemable noncontrolling interests - (2.6) - Income available to common stockholders for basic earnings per share 456.9 557.7 679.2 Effect of dilutive securities - 0.1 - Income available to common stockholders for diluted earnings per share $ 456.9 $ 557.8 $ 679.2 Weighted average common shares outstanding applicable to basic earnings per share 15,436,286 15,871,055 16,405,388 Effect of dilutive securities 6,363 8,046 - Adjusted weighted average common shares outstanding applicable to diluted earnings 15,442,649 15,879,101 16,405,388 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Aggregate Minimum Payments under Operating Leases with Initial or Remaining Terms of More Than One Year | The aggregate minimum payments under operating leases with initial or remaining terms of more than one year as of December 31, 2016 were as follows: Year Aggregate Minimum ($ in millions) 2017 $ 37.2 2018 35.0 2019 31.3 2020 27.6 2021 25.0 2022 and thereafter 119.3 |
Asbestos Related Illnesses and Environmental Impairment Loss and Loss Adjustment Expense Reserves | Loss and LAE include amounts for risks relating to asbestos-related illness and environmental impairment. As of December 31, 2016 and 2015, such gross and net reserves were as follows: December 31, 2016 December 31, 2015 Gross Net Gross Net ($ in millions) TransRe $ 165.7 $ 160.0 $ 174.9 $ 168.4 CapSpecialty 6.3 6.3 8.7 8.6 Total $ 172.0 $ 166.3 $ 183.6 $ 177.0 |
Segments of Business (Tables)
Segments of Business (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Results for Reportable Segments and Corporate Activities | Segment results for Alleghany’s two reportable segments and for corporate activities for 2016, 2015 and 2014 are shown in the tables below: Reinsurance Segment Insurance Segment Other Activities Year Ended December 31, 2016 Property Casualty (1) Total RSUI Cap Pacific Total Total Alleghany Corporate (2) Consolidated ($ in millions) Gross premiums written $ 1,515.5 $ 2,814.8 $ 4,330.3 $ 1,056.4 $ 266.5 $ 139.8 $ 1,462.7 $ 5,793.0 $ - $ (25.9) $ 5,767.1 Net premiums written 1,237.2 2,732.2 3,969.4 734.1 250.0 138.3 1,122.4 5,091.8 - - 5,091.8 Net premiums earned 1,168.0 2,677.0 3,845.0 754.5 237.5 138.8 1,130.8 4,975.8 - - 4,975.8 Net loss and LAE 578.4 1,707.0 2,285.4 403.8 125.3 102.7 631.8 2,917.2 - - 2,917.2 Commissions, brokerage and other underwriting (3) 376.2 922.8 1,299.0 212.3 107.3 38.7 358.3 1,657.3 - - 1,657.3 Underwriting profit (loss) (4) $ 213.4 $ 47.2 $ 260.6 $ 138.4 $ 4.9 $ (2.6) $ 140.7 401.3 - - 401.3 Net investment income 433.1 (2.3) 7.7 438.5 Net realized capital gains 159.9 (86.0) (10.7) 63.2 Other than temporary impairment losses (45.2) - - (45.2) Other revenue 4.4 687.1 7.3 698.8 Other operating expenses 80.6 680.5 4.1 765.2 Corporate administration 1.0 - 42.0 43.0 Amortization of intangible assets (3.1) 22.1 - 19.0 Interest expense 27.2 1.9 52.5 81.6 Earnings (losses) before income taxes $ 847.8 $ (105.7) $ (94.3) $ 647.8 Reinsurance Segment Insurance Segment Other Activities Year Ended December 31, 2015 Property Casualty (1) Total RSUI Cap Pacific Total Total Alleghany Corporate (2) Consolidated ($ in millions) Gross premiums written $ 1,171.9 $ 2,490.2 $ 3,662.1 $ 1,148.4 $ 236.6 $ 103.1 $ 1,488.1 $ 5,150.2 $ - $ (28.0) $ 5,122.2 Net premiums written 953.6 2,433.7 3,387.3 779.4 220.6 101.9 1,101.9 4,489.2 - - 4,489.2 Net premiums earned 887.4 2,228.1 3,115.5 809.8 205.0 100.0 1,114.8 4,230.3 - - 4,230.3 Net loss and LAE 292.1 1,426.6 1,718.7 428.8 115.7 76.6 621.1 2,339.8 - - 2,339.8 Commissions, brokerage and other underwriting (3) 295.6 774.2 1,069.8 222.9 94.3 36.9 354.1 1,423.9 - - 1,423.9 Underwriting profit (loss) (4) $ 299.7 $ 27.3 $ 327.0 $ 158.1 $ (5.0) $ (13.5) $ 139.6 466.6 - - 466.6 Net investment income 427.6 5.4 5.8 438.8 Net realized capital gains 242.6 (25.6) (3.1) 213.9 Other than temporary impairment losses (125.5) - (8.4) (133.9) Other revenue 6.5 241.0 2.9 250.4 Other operating expenses 80.4 259.3 2.6 342.3 Corporate administration 0.9 - 45.6 46.5 Amortization of intangible assets (5.3) 3.1 - (2.2) Interest expense 38.3 1.5 52.0 91.8 Earnings (losses) before income taxes $ 903.5 $ (43.1) $ (103.0) $ 757.4 Reinsurance Segment Insurance Segment Other Activities Year Ended December 31, 2014 Property Casualty (1) Total RSUI Cap Pacific Total Total Alleghany Corporate (2) Consolidated ($ in millions) Gross premiums written $ 1,205.4 $ 2,394.7 $ 3,600.1 $ 1,242.1 $ 212.7 $ 70.5 $ 1,525.3 $ 5,125.4 $ - $ (28.8) $ 5,096.6 Net premiums written 1,073.4 2,336.7 3,410.1 825.5 192.4 69.5 1,087.4 4,497.5 - - 4,497.5 Net premiums earned 1,048.6 2,282.1 3,330.7 828.2 184.4 67.3 1,079.9 4,410.6 - - 4,410.6 Net loss and LAE 423.2 1,486.0 1,909.2 427.3 103.0 55.0 585.3 2,494.5 - - 2,494.5 Commissions, brokerage and other underwriting (3) 319.3 757.2 1,076.5 220.8 92.0 32.0 344.8 1,421.3 - - 1,421.3 Underwriting profit (loss) (4) $ 306.1 $ 38.9 $ 345.0 $ 180.1 $ (10.6) $ (19.7) $ 149.8 494.8 - - 494.8 Net investment income 448.9 2.8 8.2 459.9 Net realized capital gains 230.0 2.8 14.3 247.1 Other than temporary impairment losses (36.3) - - (36.3) Other revenue 4.0 145.6 0.9 150.5 Other operating expenses 85.7 164.5 2.5 252.7 Corporate administration 1.3 - 45.8 47.1 Amortization of intangible assets (6.1) 0.4 - (5.7) Interest expense 46.8 0.9 42.3 90.0 Earnings (losses) before income taxes $ 1,013.7 $ (14.6) $ (67.2) $ 931.9 (1) Primarily consists of the following assumed 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; surety; and credit. (2) Includes elimination of minor reinsurance activity between segments. (3) Includes amortization associated with deferred acquisition costs of $1,253.2 million, $1,024.5 million and $1,042.0 million for the years ended December 31, 2016, 2015 and 2014, respectively. (4) Underwriting profit represents net premiums earned less net loss and LAE and commissions, brokerage and other underwriting expenses, all as determined in accordance with GAAP, and does not include net investment income, net realized capital gains, OTTI losses, other revenue, other operating expenses, corporate administration, amortization of intangible assets or interest expense. Underwriting profit does not replace earnings before income taxes determined in accordance with GAAP as a measure of profitability. Rather, Alleghany believes that underwriting profit enhances the understanding of its segments’ operating results by highlighting net earnings attributable to their underwriting performance. Earnings before income taxes (a GAAP measure) may show a profit despite an underlying underwriting loss. Where underwriting losses persist over extended periods, a reinsurance or an insurance company’s ability to continue as an ongoing concern may be at risk. Therefore, Alleghany views underwriting profit as an important measure in the overall evaluation of performance. |
Quarterly Results of Operatio42
Quarterly Results of Operations (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Selected Quarterly Financial Data | Selected quarterly financial data for 2016 and 2015 are presented below: Quarter Ended March 31 June 30 September 30 December 31 ($ in millions, except per share data) 2016 Revenues $ 1,478.9 $ 1,582.1 $ 1,614.6 $ 1,455.3 Net earnings (1) 154.5 77.1 155.8 69.5 Basic earnings per share of Common Stock (1)(2) 10.00 4.99 10.09 4.51 2015 Revenues $ 1,157.6 $ 1,300.5 $ 1,189.1 $ 1,352.4 Net earnings (1) 125.2 182.5 96.5 156.1 Basic earnings per share of Common Stock (1)(2) 7.82 11.41 6.07 9.86 (1) Attributable to Alleghany stockholders. (2) Earnings per share by quarter may not equal the amount for the full year due to the timing of repurchases of Common Stock, as well as rounding. |
Summary of Significant Accoun43
Summary of Significant Accounting Principles - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | Mar. 06, 2012 | Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 22, 2016 | Apr. 15, 2016 | Oct. 31, 2015 |
Significant Accounting Policies [Line Items] | |||||||
Par value of common stock outstanding | $ 1 | ||||||
Accounting Standards Update 2015-03 | |||||||
Significant Accounting Policies [Line Items] | |||||||
Reduction of other assets | $ 7 | $ 7 | |||||
Senior Notes | Accounting Standards Update 2015-03 | |||||||
Significant Accounting Policies [Line Items] | |||||||
Increase (decrease) in senior notes and other debt | $ (7) | $ (7) | |||||
Minimum | |||||||
Significant Accounting Policies [Line Items] | |||||||
Useful life of property and equipment | 3 years | ||||||
Maximum | |||||||
Significant Accounting Policies [Line Items] | |||||||
Useful life of property and equipment | 20 years | ||||||
Kentucky Trailer | |||||||
Significant Accounting Policies [Line Items] | |||||||
Ownership of interest held by noncontrolling partners | 20.00% | ||||||
Integrated Project Services LLC | |||||||
Significant Accounting Policies [Line Items] | |||||||
Ownership of interest held by noncontrolling partners | 16.00% | 16.00% | |||||
Bourn & Koch, Inc. | |||||||
Significant Accounting Policies [Line Items] | |||||||
Ownership of interest held by noncontrolling partners | 11.00% | 12.00% | |||||
Jazwares, LLC | |||||||
Significant Accounting Policies [Line Items] | |||||||
Ownership of interest held by noncontrolling partners | 20.00% | 20.00% | |||||
ORX | |||||||
Significant Accounting Policies [Line Items] | |||||||
Ownership interest percentage | 15.00% | ||||||
TransRe | |||||||
Significant Accounting Policies [Line Items] | |||||||
Business acquisition date | Mar. 6, 2012 | ||||||
Jazwares, LLC | |||||||
Significant Accounting Policies [Line Items] | |||||||
Ownership interest acquired | 50.00% | ||||||
Ownership Percentage by Parent | 80.00% |
Goodwill and Intangible Asset44
Goodwill and Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands | Apr. 18, 2016 | Apr. 15, 2016 | Nov. 02, 2015 | Oct. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Goodwill | [1] | $ 284,974 | $ 141,015 | ||||
Agency Relationships | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Economic useful lives of significant intangible assets | 15 years | ||||||
Brokerage and Reinsurance Relationships | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Economic useful lives of significant intangible assets | 15 years | ||||||
Renewal rights | Minimum | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Economic useful lives of significant intangible assets | 5 years | ||||||
Renewal rights | Maximum | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Economic useful lives of significant intangible assets | 14 years | ||||||
Loss and LAE reserves | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Economic useful lives of significant intangible assets | 15 years | ||||||
Leases | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Economic useful lives of significant intangible assets | 10 years | ||||||
Internally-developed software | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Economic useful lives of significant intangible assets | 2 years 6 months | ||||||
License agreements | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Economic useful lives of significant intangible assets | 8 years | ||||||
Jazwares, LLC | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Purchase price for acquisition | $ 162,800 | ||||||
Cash consideration paid for acquisition | $ 122,100 | ||||||
Potential contingent consideration on acquisition | 40,700 | ||||||
Goodwill | 130,000 | ||||||
Indefinite-lived intangible assets acquired | 52,400 | ||||||
Finite-lived intangible assets acquired | $ 89,700 | ||||||
Ownership interest acquired | 50.00% | ||||||
Ownership Percentage by Parent | 80.00% | ||||||
Integrated Project Services LLC | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Purchase price for acquisition | $ 106,300 | ||||||
Cash consideration paid for acquisition | $ 89,900 | ||||||
Potential contingent consideration on acquisition | $ 12,500 | ||||||
Ownership interest acquired | 84.00% | ||||||
Purchase price adjustments on acquisition | $ 3,900 | ||||||
Goodwill | 23,500 | ||||||
Indefinite-lived intangible assets acquired | 27,900 | ||||||
Finite-lived intangible assets acquired | $ 49,300 | ||||||
[1] | Goodwill and intangible assets have been reduced by amounts written-down in prior periods. |
Goodwill and Intangible Asset,
Goodwill and Intangible Asset, Net of Accumulated Amortization Expense on Consolidated Balance Sheets (Detail) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Goodwill and other intangible assets, Gross carrying value | $ 990,600,000 | $ 661,700,000 | |
Intangible assets excluding goodwill, gross | 705,600,000 | 520,700,000 | |
Finite lived intangible assets, accumulated amortization | 326,900,000 | 307,900,000 | |
Goodwill and other intangible assets, Net carrying value | [1] | 663,700,000 | 353,800,000 |
Intangible assets excluding goodwill, net of amortization | [1] | 378,680,000 | 212,790,000 |
Goodwill, gross | 284,974,000 | 141,015,000 | |
Accumulated Amortization | 0 | 0 | |
Goodwill | [1] | 284,974,000 | 141,015,000 |
Insurance Segment | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Goodwill and other intangible assets, Gross carrying value | [2] | 190,300,000 | 190,300,000 |
Intangible assets excluding goodwill, gross | 141,300,000 | 141,300,000 | |
Finite lived intangible assets, accumulated amortization | [2] | 68,400,000 | 65,400,000 |
Goodwill and other intangible assets, Net carrying value | [1],[2] | 121,900,000 | 124,900,000 |
Intangible assets excluding goodwill, net of amortization | [1] | 72,900,000 | 75,900,000 |
Goodwill, gross | [2] | 49,000,000 | 49,000,000 |
Accumulated Amortization | [2] | 0 | 0 |
Goodwill | [1],[2] | 49,000,000 | 49,000,000 |
Insurance Segment | Agency Relationships | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Finite lived intangible assets, gross | 17,900,000 | 17,900,000 | |
Finite lived intangible assets, accumulated amortization | 9,800,000 | 9,000,000 | |
Finite lived intangible assets, net | [1] | 8,100,000 | 8,900,000 |
Insurance Segment | Brokerage and Reinsurance Relationships | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Finite lived intangible assets, gross | 33,800,000 | 33,800,000 | |
Finite lived intangible assets, accumulated amortization | 30,400,000 | 28,200,000 | |
Finite lived intangible assets, net | [1] | 3,400,000 | 5,600,000 |
Insurance Segment | Renewal rights | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Finite lived intangible assets, gross | 24,200,000 | 24,200,000 | |
Finite lived intangible assets, accumulated amortization | 24,100,000 | 24,100,000 | |
Finite lived intangible assets, net | [1] | 100,000 | 100,000 |
Insurance Segment | Other | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Finite lived intangible assets, gross | 4,100,000 | 4,100,000 | |
Finite lived intangible assets, accumulated amortization | 4,100,000 | 4,100,000 | |
Insurance Segment | State insurance licenses | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Indefinite lived intangible assets, gross | 25,800,000 | 25,800,000 | |
Indefinite Lived Intangible Assets Accumulated Amortization | 0 | 0 | |
Indefinite lived intangible assets, net | [1] | 25,800,000 | 25,800,000 |
Insurance Segment | Trade name | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Indefinite lived intangible assets, gross | 35,500,000 | 35,500,000 | |
Indefinite Lived Intangible Assets Accumulated Amortization | 0 | 0 | |
Indefinite lived intangible assets, net | [1] | 35,500,000 | 35,500,000 |
Reinsurance Segment | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Intangible assets excluding goodwill, gross | [2] | 287,500,000 | 287,500,000 |
Finite lived intangible assets, accumulated amortization | [2] | 232,700,000 | 238,900,000 |
Intangible assets excluding goodwill, net of amortization | [1],[2] | 54,800,000 | 48,600,000 |
Reinsurance Segment | Renewal rights | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Finite lived intangible assets, gross | [2] | 44,000,000 | 44,000,000 |
Finite lived intangible assets, accumulated amortization | [2] | 17,800,000 | 13,500,000 |
Finite lived intangible assets, net | [1],[2] | 26,200,000 | 30,500,000 |
Reinsurance Segment | Value of business in-force | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Finite lived intangible assets, gross | [2] | 291,400,000 | 291,400,000 |
Finite lived intangible assets, accumulated amortization | [2] | 291,400,000 | 291,400,000 |
Reinsurance Segment | Loss and LAE reserves | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Finite lived intangible assets, gross | [2] | (98,800,000) | (98,800,000) |
Finite lived intangible assets, accumulated amortization | [2] | (72,700,000) | (65,100,000) |
Finite lived intangible assets, net | [1],[2] | (26,100,000) | (33,700,000) |
Reinsurance Segment | Leases | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Finite lived intangible assets, gross | [2] | (28,100,000) | (28,100,000) |
Finite lived intangible assets, accumulated amortization | [2] | (13,800,000) | (10,900,000) |
Finite lived intangible assets, net | [1],[2] | (14,300,000) | (17,200,000) |
Reinsurance Segment | Internally-developed software | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Finite lived intangible assets, gross | [2] | 10,000,000 | 10,000,000 |
Finite lived intangible assets, accumulated amortization | [2] | 10,000,000 | 10,000,000 |
Reinsurance Segment | Trade name | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Indefinite lived intangible assets, gross | [2] | 50,000,000 | 50,000,000 |
Indefinite Lived Intangible Assets Accumulated Amortization | [2] | 0 | 0 |
Indefinite lived intangible assets, net | [1],[2] | 50,000,000 | 50,000,000 |
Reinsurance Segment | State and foreign insurance licenses | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Indefinite lived intangible assets, gross | [2] | 19,000,000 | 19,000,000 |
Indefinite Lived Intangible Assets Accumulated Amortization | [2] | 0 | 0 |
Indefinite lived intangible assets, net | [1],[2] | 19,000,000 | 19,000,000 |
Other activities | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Goodwill and other intangible assets, Gross carrying value | [2],[3] | 512,800,000 | 183,900,000 |
Intangible assets excluding goodwill, gross | [3] | 276,800,000 | 91,900,000 |
Finite lived intangible assets, accumulated amortization | [2],[3] | 25,800,000 | 3,600,000 |
Goodwill and other intangible assets, Net carrying value | [1],[2],[3] | 487,000,000 | 180,300,000 |
Intangible assets excluding goodwill, net of amortization | [1],[3] | 251,000,000 | 88,300,000 |
Goodwill, gross | [2],[3] | 236,000,000 | 92,000,000 |
Accumulated Amortization | [2],[3] | 0 | 0 |
Goodwill | [1],[2],[3] | 236,000,000 | 92,000,000 |
Other activities | Other | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Finite lived intangible assets, gross | [3] | 84,000,000 | 53,000,000 |
Finite lived intangible assets, accumulated amortization | [3] | 19,900,000 | 3,600,000 |
Finite lived intangible assets, net | [1],[3] | 64,100,000 | 49,400,000 |
Other activities | License agreements | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Finite lived intangible assets, gross | [3] | 66,200,000 | |
Finite lived intangible assets, accumulated amortization | [3] | 5,900,000 | |
Finite lived intangible assets, net | [1],[3] | 60,300,000 | |
Other activities | Trade name | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Indefinite lived intangible assets, gross | [3] | 126,600,000 | 38,900,000 |
Indefinite Lived Intangible Assets Accumulated Amortization | [3] | 0 | 0 |
Indefinite lived intangible assets, net | [1],[3] | $ 126,600,000 | $ 38,900,000 |
[1] | Goodwill and intangible assets have been reduced by amounts written-down in prior periods. | ||
[2] | See Note 13 for additional information on Alleghany's segments of business. | ||
[3] | Primarily represents goodwill and other intangible assets related to the acquisition of: (i) Jazwares on April 15, 2016; (ii) IPS on October 31, 2015; (iii) Bourn & Koch on April 26, 2012; and (iv) a controlling equity interest in Kentucky Trailer on August 30, 2013. Also reflects minor acquisitions made by Jazwares and Bourn & Koch in 2016 and Kentucky Trailer in 2015 and 2014. |
Carrying Values and Estimated F
Carrying Values and Estimated Fair Values of Consolidated Financial Instruments (Detail) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 | |
Assets | |||
Investments (excluding equity method investments and loans) | [1] | $ 16,899.2 | $ 17,007.6 |
Liabilities | |||
Senior Notes and other debt | [2] | 1,584.3 | 1,525 |
Carrying Value | |||
Assets | |||
Investments (excluding equity method investments and loans) | [1] | 16,899.2 | 17,007.6 |
Liabilities | |||
Senior Notes and other debt | [2] | $ 1,476.5 | $ 1,419.4 |
[1] | This table includes AFS investments (debt and equity securities, as well as partnership and non-marketable equity investments carried 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 carried at unpaid principal balance. The fair value of short-term investments approximates amortized cost. The fair value of all other categories of investments is discussed below. | ||
[2] | See Note 8 for additional information on the Senior Notes and other debt. |
Financial Instruments Measured
Financial Instruments Measured at Fair Value and Level of Fair Value Hierarchy of Inputs (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale equities | $ 3,109,523 | $ 3,005,908 | |
Estimated fair value of available for sale debt securities | 12,983,213 | 13,605,963 | |
Estimated fair values of financial instruments | 16,871,100 | 16,977,700 | |
Total investments (excluding equity method investments and loans) | [1] | 16,899,200 | 17,007,600 |
Senior Notes and other debt | [2] | 1,584,300 | 1,525,000 |
Equity Securities | Common Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale equities | 3,109,500 | 3,005,900 | |
Debt Securities | 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 | 1,243,300 | 1,074,700 | |
Debt Securities | Municipal bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 4,185,800 | 4,339,600 | |
Debt Securities | 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 | 1,047,100 | 941,400 | |
Debt Securities | 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 | 2,193,100 | 2,176,700 | |
Debt Securities | 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 | 1,088,800 | 1,230,300 | |
Debt Securities | Mortgage and asset backed securities | RMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [3] | 1,000,400 | 1,253,400 |
Debt Securities | Mortgage and asset backed securities | CMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 734,800 | 1,023,400 | |
Debt Securities | Mortgage and asset backed securities | 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] | 1,489,900 | 1,566,500 |
Short-term Investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair values of financial instruments | 778,400 | 365,800 | |
Other invested assets | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair values of financial instruments | [5] | 28,100 | 29,900 |
Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale equities | 3,105,200 | 3,001,200 | |
Total investments (excluding equity method investments and loans) | 3,105,200 | 3,001,200 | |
Level 1 | Equity Securities | Common Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale equities | 3,105,200 | 3,001,200 | |
Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale equities | 4,700 | ||
Estimated fair value of available for sale debt securities | 11,995,900 | 12,568,100 | |
Total investments (excluding equity method investments and loans) | 12,774,300 | 12,938,600 | |
Senior Notes and other debt | 1,491,500 | 1,488,700 | |
Level 2 | Equity Securities | Common Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale equities | 4,700 | ||
Level 2 | Debt Securities | 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 | 1,243,300 | 1,074,700 | |
Level 2 | Debt Securities | Municipal bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 4,185,800 | 4,339,600 | |
Level 2 | Debt Securities | 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 | 1,047,100 | 941,400 | |
Level 2 | Debt Securities | 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 | 2,120,200 | 2,126,900 | |
Level 2 | Debt Securities | 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 | 1,088,400 | 1,230,300 | |
Level 2 | Debt Securities | Mortgage and asset backed securities | RMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [3] | 994,500 | 1,238,500 |
Level 2 | Debt Securities | Mortgage and asset backed securities | CMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | 730,500 | 1,003,200 | |
Level 2 | Debt Securities | Mortgage and asset backed securities | 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] | 586,100 | 613,500 |
Level 2 | Short-term Investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair values of financial instruments | 778,400 | 365,800 | |
Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale equities | 4,300 | ||
Estimated fair value of available for sale debt securities | 987,300 | 1,037,900 | |
Total investments (excluding equity method investments and loans) | 1,019,700 | 1,067,800 | |
Senior Notes and other debt | 92,800 | 36,300 | |
Level 3 | Equity Securities | Common Stock | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale equities | 4,300 | ||
Level 3 | Debt Securities | 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 | 72,900 | 49,800 | |
Level 3 | Debt Securities | 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 | 400 | ||
Level 3 | Debt Securities | Mortgage and asset backed securities | RMBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | [3] | 5,900 | 14,900 |
Level 3 | Debt Securities | Mortgage and asset backed securities | 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 | 20,200 | |
Level 3 | Debt Securities | Mortgage and asset backed securities | 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] | 903,800 | 953,000 |
Level 3 | Other invested assets | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair values of financial instruments | [5] | $ 28,100 | $ 29,900 |
[1] | This table includes AFS investments (debt and equity securities, as well as partnership and non-marketable equity investments carried 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 carried at unpaid principal balance. The fair value of short-term investments approximates amortized cost. The fair value of all other categories of investments is discussed below. | ||
[2] | See Note 8 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] | Includes $903.8 million and $946.7 million of collateralized loan obligations as of December 31, 2016 and 2015, respectively. | ||
[5] | Includes partnership and non-marketable equity investments accounted for on an AFS basis, and excludes investments accounted for using the equity method. |
Financial Instruments Measure48
Financial Instruments Measured at Fair Value and Level of Fair Value Hierarchy of Inputs (Parenthetical) (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | $ 12,983,213 | $ 13,605,963 | |
Other asset-backed securities | Debt Securities | Mortgage and 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] | 1,489,900 | 1,566,500 |
Other asset-backed securities | Debt Securities | Mortgage and asset backed securities | Collateralized loan obligations | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Estimated fair value of available for sale debt securities | $ 903,800 | $ 946,700 | |
[1] | Includes $903.8 million and $946.7 million of collateralized loan obligations as of December 31, 2016 and 2015, respectively. |
Fair Value of Financial Instr49
Fair Value of Financial Instruments - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Gross transfers out of Level 3 | $ 20.2 | $ 22.9 | |
Gross transfers into Level 3 | 10.6 | 19.9 | |
Debt Securities | U.S. corporate bonds | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Gross transfers out of Level 3 | 8.6 | 15.9 | |
Gross transfers into Level 3 | 7.3 | 14.2 | |
Debt Securities | Foreign corporate bonds | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Gross transfers out of Level 3 | 1.7 | 5.5 | |
Gross transfers into Level 3 | 1.9 | 0.7 | |
Other invested assets | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Gross transfers out of Level 3 | [1] | 0.3 | 1.5 |
Gross transfers into Level 3 | [1] | $ 5 | |
Equity Securities | Common Stock | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Gross transfers out of Level 3 | 0.3 | ||
Gross transfers into Level 3 | 1.4 | ||
CMBS | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Gross transfers out of Level 3 | 5.8 | ||
Securities Other Than U.S. Corporate Bonds and Commercial Mortgage Backed Securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Gross transfers out of Level 3 | $ 5.8 | ||
[1] | Includes partnership and non-marketable equity investments accounted for on an AFS basis. |
Reconciliations of Changes in L
Reconciliations of Changes in Level Three Assets Measured at Fair Value (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | $ 1,067.8 | $ 1,041.4 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | 8.1 | 3.3 |
Other comprehensive income | 27.7 | (28.3) | |
Purchases | 225.7 | 270.6 | |
Sales | (113.6) | (186.9) | |
Issuances | 0 | 0 | |
Settlements | (186.4) | (29.3) | |
Transfers into Level 3 | 10.6 | 19.9 | |
Transfers out of Level 3 | (20.2) | (22.9) | |
Ending balance | 1,019.7 | 1,067.8 | |
Equity Securities | Common Stock | |||
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | (0.6) | |
Other comprehensive income | 1.8 | ||
Purchases | 2.2 | ||
Sales | (0.2) | ||
Issuances | 0 | ||
Transfers into Level 3 | 1.4 | ||
Transfers out of Level 3 | (0.3) | ||
Ending balance | 4.3 | ||
Debt Securities | U.S. corporate bonds | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 49.8 | 36.7 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | (0.3) | (0.6) |
Other comprehensive income | 0.1 | (1.3) | |
Purchases | 46.1 | 35.5 | |
Sales | (15) | (1.9) | |
Issuances | 0 | 0 | |
Settlements | (6.5) | (16.9) | |
Transfers into Level 3 | 7.3 | 14.2 | |
Transfers out of Level 3 | (8.6) | (15.9) | |
Ending balance | 72.9 | 49.8 | |
Debt Securities | Foreign corporate bonds | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 6 | ||
Net realized/unrealized gains (losses) included in: | |||
Other comprehensive income | 0.8 | ||
Purchases | 0.4 | ||
Sales | (0.2) | (2) | |
Issuances | 0 | 0 | |
Transfers into Level 3 | 1.9 | 0.7 | |
Transfers out of Level 3 | (1.7) | (5.5) | |
Ending balance | 0.4 | ||
Debt Securities | Mortgage and asset backed securities | RMBS | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 14.9 | 18.2 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | 0.3 | 0.6 |
Other comprehensive income | (0.5) | (1.1) | |
Sales | (7) | ||
Issuances | 0 | 0 | |
Settlements | (1.8) | (2.8) | |
Ending balance | 5.9 | 14.9 | |
Debt Securities | Mortgage and asset backed securities | CMBS | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 20.2 | 23.3 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | (0.2) | (0.4) |
Other comprehensive income | 0.4 | (1) | |
Sales | (9.7) | ||
Issuances | 0 | 0 | |
Settlements | (0.6) | (1.7) | |
Transfers out of Level 3 | (5.8) | ||
Ending balance | 4.3 | 20.2 | |
Debt Securities | Mortgage and asset backed securities | Other asset-backed securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 953 | 933.1 | |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1] | 4.2 | 2.7 |
Other comprehensive income | 27.4 | (25.9) | |
Purchases | 177 | 233.3 | |
Sales | (76.8) | (182.3) | |
Issuances | 0 | 0 | |
Settlements | (177.5) | (7.9) | |
Transfers out of Level 3 | (3.5) | ||
Ending balance | 903.8 | 953 | |
Other invested assets | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | [2] | 29.9 | 24.1 |
Net realized/unrealized gains (losses) included in: | |||
Net earnings | [1],[2] | 4.7 | 1 |
Other comprehensive income | [2] | (1.5) | 0.2 |
Purchases | [2] | 1.8 | |
Sales | [2] | (4.7) | (0.7) |
Issuances | [2] | 0 | 0 |
Transfers into Level 3 | [2] | 5 | |
Transfers out of Level 3 | [2] | (0.3) | (1.5) |
Ending balance | [2] | $ 28.1 | $ 29.9 |
[1] | There were no OTTI losses recorded in net earnings related to Level 3 instruments still held as of December 31, 2016 and 2015. | ||
[2] | Includes partnership and non-marketable equity investments accounted for on an AFS basis. |
Amortized Cost or Cost and Fair
Amortized Cost or Cost and Fair Value of Available For Sale Securities (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost or Cost | $ 16,522,100 | $ 16,636,700 | |
Gross Unrealized Gains | 512,800 | 573,800 | |
Gross Unrealized Losses | (163,800) | (232,800) | |
Fair Value | 16,871,100 | 16,977,700 | |
Equity securities, cost | 2,816,572 | 2,740,984 | |
Equity securities, gross unrealized gains | 332,100 | 351,900 | |
Equity securities, gross unrealized losses | (39,200) | (87,000) | |
Equity securities, fair value | 3,109,523 | 3,005,908 | |
Debt securities, amortized cost | 12,927,103 | 13,529,923 | |
Debt securities, gross unrealized gains | 180,700 | 221,900 | |
Debt securities, gross unrealized losses | (124,600) | (145,800) | |
Debt securities, fair value | 12,983,213 | 13,605,963 | |
Debt Securities | U.S. Government obligations | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Debt securities, amortized cost | 1,265,700 | 1,086,800 | |
Debt securities, gross unrealized gains | 2,200 | 1,900 | |
Debt securities, gross unrealized losses | (24,600) | (14,000) | |
Debt securities, fair value | 1,243,300 | 1,074,700 | |
Debt Securities | Municipal bonds | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Debt securities, amortized cost | 4,161,000 | 4,213,600 | |
Debt securities, gross unrealized gains | 66,900 | 134,800 | |
Debt securities, gross unrealized losses | (42,100) | (8,800) | |
Debt securities, fair value | 4,185,800 | 4,339,600 | |
Debt Securities | Foreign government obligations | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Debt securities, amortized cost | 1,030,900 | 924,100 | |
Debt securities, gross unrealized gains | 20,200 | 18,600 | |
Debt securities, gross unrealized losses | (4,000) | (1,300) | |
Debt securities, fair value | 1,047,100 | 941,400 | |
Debt Securities | U.S. corporate bonds | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Debt securities, amortized cost | 2,168,900 | 2,201,300 | |
Debt securities, gross unrealized gains | 43,500 | 23,400 | |
Debt securities, gross unrealized losses | (19,300) | (48,000) | |
Debt securities, fair value | 2,193,100 | 2,176,700 | |
Debt Securities | Foreign corporate bonds | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Debt securities, amortized cost | 1,068,300 | 1,219,000 | |
Debt securities, gross unrealized gains | 27,300 | 24,000 | |
Debt securities, gross unrealized losses | (6,800) | (12,700) | |
Debt securities, fair value | 1,088,800 | 1,230,300 | |
Debt Securities | Mortgage and asset backed securities | RMBS | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Debt securities, amortized cost | 1,005,900 | 1,255,100 | |
Debt securities, gross unrealized gains | 7,000 | 10,700 | |
Debt securities, gross unrealized losses | (12,500) | (12,400) | |
Debt securities, fair value | [1] | 1,000,400 | 1,253,400 |
Debt Securities | Mortgage and asset backed securities | CMBS | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Debt securities, amortized cost | 728,800 | 1,024,800 | |
Debt securities, gross unrealized gains | 9,600 | 8,200 | |
Debt securities, gross unrealized losses | (3,600) | (9,600) | |
Debt securities, fair value | 734,800 | 1,023,400 | |
Debt Securities | Mortgage and asset backed securities | Other asset-backed securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Debt securities, amortized cost | [2] | 1,497,600 | 1,605,200 |
Debt securities, gross unrealized gains | [2] | 4,000 | 300 |
Debt securities, gross unrealized losses | [2] | (11,700) | (39,000) |
Debt securities, fair value | [2] | 1,489,900 | 1,566,500 |
Equity Securities | Common Stock | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Equity securities, cost | 2,816,600 | 2,741,000 | |
Equity securities, gross unrealized gains | 332,100 | 351,900 | |
Equity securities, gross unrealized losses | (39,200) | (87,000) | |
Equity securities, fair value | 3,109,500 | 3,005,900 | |
Short-term Investments | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost or Cost | 778,400 | 365,800 | |
Fair Value | $ 778,400 | $ 365,800 | |
[1] | Primarily includes government agency pass-through securities guaranteed by a government agency or government sponsored enterprise, among other types of RMBS. | ||
[2] | Includes $903.8 million and $946.7 million of collateralized loan obligations as of December 31, 2016 and 2015, respectively. |
Amortized Cost or Cost and Fa52
Amortized Cost or Cost and Fair Value of Available For Sale Securities (Parenthetical) (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Available-for-sale Securities [Line Items] | |||
Estimated fair value of available for sale debt securities | $ 12,983,213 | $ 13,605,963 | |
Other asset-backed securities | Debt Securities | Mortgage and asset backed securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Estimated fair value of available for sale debt securities | [1] | 1,489,900 | 1,566,500 |
Other asset-backed securities | Debt Securities | Mortgage and asset backed securities | Collateralized loan obligations | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Estimated fair value of available for sale debt securities | $ 903,800 | $ 946,700 | |
[1] | Includes $903.8 million and $946.7 million of collateralized loan obligations as of December 31, 2016 and 2015, respectively. |
Amortized Cost and Estimated Fa
Amortized Cost and Estimated Fair Value of Debt Securities by Contractual Maturity (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Available-for-sale Securities [Line Items] | |||
Short-term investments due in one year or less, amortized cost or cost | $ 778,410 | $ 365,810 | |
Mortgage and asset-backed securities, amortized cost or cost | [1] | 3,232,300 | |
Debt securities with maturity dates, amortized cost or cost: | |||
One year or less | 428,600 | ||
Over one through five years | 3,048,500 | ||
Over five through ten years | 3,229,100 | ||
Over ten years | 2,988,600 | ||
Debt securities, amortized cost | 12,927,103 | 13,529,923 | |
Equity securities, cost | 2,816,572 | 2,740,984 | |
Amortized Cost or Cost | 16,522,100 | 16,636,700 | |
Short-term investments due in one year or less, fair value | 778,400 | ||
Mortgage and asset-backed securities, fair value | [1] | 3,225,100 | |
Debt securities with maturity dates, fair value: | |||
One year or less | 430,800 | ||
Over one through five years | 3,074,500 | ||
Over five through ten years | 3,250,700 | ||
Over ten years | 3,002,100 | ||
Total debt securities, fair value | 12,983,213 | 13,605,963 | |
Equity securities, fair value | 3,109,523 | 3,005,908 | |
Fair Value | $ 16,871,100 | $ 16,977,700 | |
[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 | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Net Investment Income [Line Items] | ||||
Interest income | $ 385,700 | $ 376,400 | $ 384,400 | |
Dividend income | 50,300 | 54,000 | 63,000 | |
Investment expenses | (26,300) | (27,200) | (28,800) | |
Other investment results | 1,500 | 12,000 | 13,900 | |
Net investment income | 438,455 | 438,817 | 459,876 | |
Ares | ||||
Net Investment Income [Line Items] | ||||
Equity results | [1] | 11,500 | 6,600 | 8,600 |
ORX | ||||
Net Investment Income [Line Items] | ||||
Equity results | (6,300) | (3,200) | ||
Pillar Holdings and Funds | Pillar Capital Holdings Limited And Managed Funds | ||||
Net Investment Income [Line Items] | ||||
Equity results | [1] | $ 15,800 | $ 23,300 | $ 22,000 |
[1] | See Note 4(h) for discussion of the Pillar Investments and the investment in Ares, each as defined therein. |
Investments - Additional Inform
Investments - Additional Information (Detail) | Apr. 15, 2016USD ($) | Apr. 30, 2014USD ($) | Jul. 31, 2013USD ($) | Dec. 31, 2012USD ($) | Dec. 31, 2016USD ($)Investment | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Apr. 14, 2016 | Oct. 15, 2014USD ($) | May 31, 2014 |
Investment [Line Items] | ||||||||||
Proceeds from sales of AFS securities | $ 7,000,000,000 | $ 9,600,000,000 | $ 6,600,000,000 | |||||||
Pre-tax net realized capital gains (loss) | $ 63,205,000 | 213,897,000 | 247,058,000 | |||||||
Securities impairment test description | Management’s assessment of equity securities initially involves an evaluation of all securities that are in an unrealized loss position, regardless of the duration or severity of the loss, as of the applicable balance sheet date. Such initial review consists primarily of assessing whether: (i) there has been a negative credit or news event with respect to the issuer that could indicate the existence of an OTTI; and (ii) Alleghany has the ability and intent to hold an equity security for a period of time sufficient to allow for an anticipated recovery (generally considered to be 12 months from the balance sheet date). To the extent that an equity security in an unrealized loss position is not impaired based on the initial review described above, Alleghany then further evaluates such equity security and deems it to be other than temporarily impaired if it has been in an unrealized loss position for 12 months or more or if its unrealized loss position is greater than 50 percent of its cost, absent compelling evidence to the contrary.Alleghany then evaluates those equity securities where the unrealized loss is at least 20 percent of cost as of the balance sheet date or that have been in an unrealized loss position continuously for six months or more preceding the balance sheet date. This evaluation takes into account quantitative and qualitative factors in determining whether such securities are other than temporarily impaired including: (i) market valuation metrics associated with the equity security (such as dividend yield and price-to-earnings ratio); (ii) current views on the equity security, as expressed by either Alleghany’s internal stock analysts and/or by third-party stock analysts or rating agencies; and (iii) credit or news events associated with a specific issuer, such as negative news releases and rating agency downgrades with respect to the issuer of the equity security. Debt securities in an unrealized loss position are evaluated for OTTI if they meet any of the following criteria: (i) they are trading at a discount of at least 20 percent to amortized cost for an extended period of time (nine consecutive months or more); (ii) there has been a negative credit or news event with respect to the issuer that could indicate the existence of an OTTI; 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 an OTTI 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 an OTTI 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 OTTI 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. | |||||||||
Other than temporary impairment losses | $ 45,165,000 | $ 133,868,000 | 36,294,000 | |||||||
Number of debt and equity securities in an unrealized loss position | Investment | 1,317 | |||||||||
Percentage of debt securities owned with credit rating below investment grade or not rated | 5.10% | 3.60% | ||||||||
Statutory deposit, investments at fair value | $ 1,700,000,000 | |||||||||
Other invested assets | 645,245,000 | $ 676,811,000 | ||||||||
Stranded Oil Resources Corporation | ||||||||||
Investment [Line Items] | ||||||||||
Pre-tax net realized capital gains (loss) | (98,800,000) | |||||||||
2015 Notes | Transatlantic Holdings Incorporated | ||||||||||
Investment [Line Items] | ||||||||||
Loss on early extinguishment of debt | (9,400,000) | |||||||||
Senior notes, face value repurchased | $ 300,000,000 | $ 300,000,000 | ||||||||
Senior notes, interest rate | 5.75% | |||||||||
Senior notes, maturity date | Dec. 14, 2015 | |||||||||
Pillar Capital Holdings Limited And Managed Funds | Pillar Holdings and Funds | ||||||||||
Investment [Line Items] | ||||||||||
Other invested assets | 233,700,000 | |||||||||
Pillar Capital Holdings Limited And Managed Funds | Pillar Holdings and Funds | Reinsurance Segment | ||||||||||
Investment [Line Items] | ||||||||||
Investment in other invested asset | $ 175,000,000 | |||||||||
Pillar Capital Holdings Limited And Managed Funds | Pillar Holdings and Funds | Insurance Segment | ||||||||||
Investment [Line Items] | ||||||||||
Investment in other invested asset | $ 25,000,000 | |||||||||
ORX | ||||||||||
Investment [Line Items] | ||||||||||
Pre-tax net realized capital gains (loss) | (25,800,000) | |||||||||
Ares | ||||||||||
Investment [Line Items] | ||||||||||
Other invested assets | $ 224,000,000 | |||||||||
Investment in other invested asset | $ 250,000,000 | |||||||||
Percentage of equity stake | 6.25% | |||||||||
Potential ownership interest, upon conversion of limited partner equity interests into common stock | 5.90% | |||||||||
Conversion of Investment Interest Description | These interests may be converted at any time at Alleghany's discretion. | |||||||||
Jazwares, LLC | ||||||||||
Investment [Line Items] | ||||||||||
Ownership interest acquired | 50.00% | |||||||||
Gain on acquisition | $ 13,200,000 | $ 13,200,000 | ||||||||
Commercial Mortgage Loan Portfolio | ||||||||||
Investment [Line Items] | ||||||||||
Commercial mortgage loans | 594,878,000 | 177,947,000 | ||||||||
Allowance for loan losses on commercial mortgage loans | 0 | |||||||||
Jazwares, LLC | ||||||||||
Investment [Line Items] | ||||||||||
Ownership interest percentage | 30.00% | |||||||||
Equity Securities | ||||||||||
Investment [Line Items] | ||||||||||
Other than temporary impairment losses | 23,300,000 | 115,600,000 | $ 28,700,000 | |||||||
Debt Securities | ||||||||||
Investment [Line Items] | ||||||||||
Other than temporary impairment losses | $ 21,900,000 | $ 18,300,000 | $ 7,600,000 | |||||||
Number of securities in an unrealized loss position for 12 months or more | Investment | 138 | |||||||||
Debt Securities | U.S. Government obligations | ||||||||||
Investment [Line Items] | ||||||||||
Pre-tax net realized capital gains (loss) | $ 34,000,000 | |||||||||
Minimum | Commercial Mortgage Loan Portfolio | ||||||||||
Investment [Line Items] | ||||||||||
Term of commercial mortgage loans | 2 years | |||||||||
Minimum | Equity Securities | ||||||||||
Investment [Line Items] | ||||||||||
Percentage of unrealized loss to cost where a security would be deemed to be other than temporarily impaired, absent compelling evidence to the contrary | 50.00% | |||||||||
Percentage of unrealized loss to cost where a security would be evaluated for other than temporarily impairment | 20.00% | |||||||||
Minimum | Debt Securities | ||||||||||
Investment [Line Items] | ||||||||||
Percentage of unrealized loss to cost where a security would be evaluated for other than temporarily impairment | 20.00% | |||||||||
Maximum | Ares | ||||||||||
Investment [Line Items] | ||||||||||
Investment commitment in investment fund | $ 1,000,000,000 | |||||||||
Maximum | Commercial Mortgage Loan Portfolio | ||||||||||
Investment [Line Items] | ||||||||||
Term of commercial mortgage loans | 10 years | |||||||||
Percentage of principal amount of loans to the property's appraised value | 66.67% |
Amount of Gross Realized Capita
Amount of Gross Realized Capital Gains and Gross Realized Capital Losses of Available For Sale Securities (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Gain (Loss) on Investments [Line Items] | |||
Gross realized capital gains | $ 344,700 | $ 424,200 | $ 301,100 |
Gross realized capital losses | (281,500) | (210,300) | (54,000) |
Net realized capital gains | $ 63,205 | $ 213,897 | $ 247,058 |
Gross Unrealized Losses and Rel
Gross Unrealized Losses and Related Fair Values for Equity Securities and Debt Securities Grouped by Duration of Time in Continuous Unrealized Loss Position (Detail) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | $ 5,491.7 | $ 6,557.4 |
Securities, less than 12 months, gross unrealized losses | 146.6 | 197.5 |
Securities, 12 months or more, fair value | 809.8 | 729.4 |
Securities, 12 months or more, gross unrealized losses | 17.2 | 35.3 |
Total, fair value | 6,301.5 | 7,286.8 |
Total, gross unrealized losses | 163.8 | 232.8 |
Equity Securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 619.4 | 1,355.6 |
Securities, less than 12 months, gross unrealized losses | 39.2 | 87 |
Total, fair value | 619.4 | 1,355.6 |
Total, gross unrealized losses | 39.2 | 87 |
Equity Securities | Common Stock | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 619.4 | 1,355.6 |
Securities, less than 12 months, gross unrealized losses | 39.2 | 87 |
Total, fair value | 619.4 | 1,355.6 |
Total, gross unrealized losses | 39.2 | 87 |
Debt Securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 4,872.3 | 5,201.8 |
Securities, less than 12 months, gross unrealized losses | 107.4 | 110.5 |
Securities, 12 months or more, fair value | 809.8 | 729.4 |
Securities, 12 months or more, gross unrealized losses | 17.2 | 35.3 |
Total, fair value | 5,682.1 | 5,931.2 |
Total, gross unrealized losses | 124.6 | 145.8 |
Debt Securities | U.S. Government obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 975 | 818.4 |
Securities, less than 12 months, gross unrealized losses | 24.6 | 13.9 |
Securities, 12 months or more, fair value | 7.9 | |
Securities, 12 months or more, gross unrealized losses | 0.1 | |
Total, fair value | 975 | 826.3 |
Total, gross unrealized losses | 24.6 | 14 |
Debt Securities | Municipal bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 1,464.5 | 276.2 |
Securities, less than 12 months, gross unrealized losses | 39.7 | 2.4 |
Securities, 12 months or more, fair value | 41.6 | 108.3 |
Securities, 12 months or more, gross unrealized losses | 2.4 | 6.4 |
Total, fair value | 1,506.1 | 384.5 |
Total, gross unrealized losses | 42.1 | 8.8 |
Debt Securities | Foreign government obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 238.3 | 208.5 |
Securities, less than 12 months, gross unrealized losses | 4 | 1.3 |
Total, fair value | 238.3 | 208.5 |
Total, gross unrealized losses | 4 | 1.3 |
Debt Securities | U.S. corporate bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 727.9 | 1,149.8 |
Securities, less than 12 months, gross unrealized losses | 18.1 | 39 |
Securities, 12 months or more, fair value | 52.6 | 70 |
Securities, 12 months or more, gross unrealized losses | 1.2 | 9 |
Total, fair value | 780.5 | 1,219.8 |
Total, gross unrealized losses | 19.3 | 48 |
Debt Securities | Foreign corporate bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 331 | 479.9 |
Securities, less than 12 months, gross unrealized losses | 6.6 | 10.8 |
Securities, 12 months or more, fair value | 4.1 | 12.5 |
Securities, 12 months or more, gross unrealized losses | 0.2 | 1.9 |
Total, fair value | 335.1 | 492.4 |
Total, gross unrealized losses | 6.8 | 12.7 |
Debt Securities | Mortgage and asset backed securities | RMBS | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 652 | 511.1 |
Securities, less than 12 months, gross unrealized losses | 11.4 | 6.5 |
Securities, 12 months or more, fair value | 43.4 | 250.6 |
Securities, 12 months or more, gross unrealized losses | 1.1 | 5.9 |
Total, fair value | 695.4 | 761.7 |
Total, gross unrealized losses | 12.5 | 12.4 |
Debt Securities | Mortgage and asset backed securities | CMBS | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 148.9 | 593.1 |
Securities, less than 12 months, gross unrealized losses | 1.4 | 9.4 |
Securities, 12 months or more, fair value | 117.7 | 15.1 |
Securities, 12 months or more, gross unrealized losses | 2.2 | 0.2 |
Total, fair value | 266.6 | 608.2 |
Total, gross unrealized losses | 3.6 | 9.6 |
Debt Securities | Mortgage and asset backed securities | Other asset-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities, less than 12 months, fair value | 334.7 | 1,164.8 |
Securities, less than 12 months, gross unrealized losses | 1.6 | 27.2 |
Securities, 12 months or more, fair value | 550.4 | 265 |
Securities, 12 months or more, gross unrealized losses | 10.1 | 11.8 |
Total, fair value | 885.1 | 1,429.8 |
Total, gross unrealized losses | $ 11.7 | $ 39 |
Reinsurance Recoverables (Detai
Reinsurance Recoverables (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Ceded Credit Risk [Line Items] | ||||||
Reinsurance recoverables on paid losses | $ 36,000 | $ 80,600 | ||||
Ceded outstanding loss and LAE | [2] | 1,236,200 | [1] | 1,169,300 | $ 1,289,400 | $ 1,302,100 |
Total | $ 1,272,219 | $ 1,249,948 | ||||
[1] | Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. | |||||
[2] | Reinsurance recoverables in this table include only ceded loss and LAE reserves. |
Information Regarding Concentra
Information Regarding Concentration of Reinsurance Recoverables and Ratings Profile of its Reinsurers (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | $ 1,272,219 | $ 1,249,948 | |
Reinsurance Recoverable | Reinsurer Concentration Risk | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [1],[2] | $ 1,272,200 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [1],[2] | 100.00% | |
Reinsurance Recoverable | Reinsurer Concentration Risk | Ceded Credit Risk, Secured | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2],[3] | $ 183,300 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[3] | 14.40% | |
Reinsurance Recoverable | Reinsurer Concentration Risk | All other reinsurers | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2] | $ 392,200 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2] | 30.70% | |
A+ (Superior) | Reinsurance Recoverable | Reinsurer Concentration Risk | Swiss Reinsurance Company | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2],[4] | $ 172,100 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[4] | 13.50% | |
A+ (Superior) | Reinsurance Recoverable | Reinsurer Concentration Risk | Renaissance Re Holdings Limited | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2],[4] | $ 91,000 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[4] | 7.20% | |
A+ (Superior) | Reinsurance Recoverable | Reinsurer Concentration Risk | W.R. Berkley Corporation | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2],[4] | $ 89,900 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[4] | 7.10% | |
A+ (Superior) | Reinsurance Recoverable | Reinsurer Concentration Risk | Allianz SE | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2],[4] | $ 63,500 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[4] | 5.00% | |
A+ (Superior) | Reinsurance Recoverable | Reinsurer Concentration Risk | Hannover Ruck SE | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2],[4] | $ 46,900 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[4] | 3.70% | |
A (Excellent) | Reinsurance Recoverable | Reinsurer Concentration Risk | PartnerRe Limited | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2],[4] | $ 116,100 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[4] | 9.10% | |
A (Excellent) | Reinsurance Recoverable | Reinsurer Concentration Risk | Syndicates at Lloyd's of London | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2],[4] | $ 105,000 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[4] | 8.30% | |
A (Excellent) | Reinsurance Recoverable | Reinsurer Concentration Risk | Allied World Assurance Company Holdings Ag | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2],[4],[5] | $ 60,500 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[4],[5] | 4.80% | |
A (Excellent) | Reinsurance Recoverable | Reinsurer Concentration Risk | Fairfax Financial Holdings Limited | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2],[4],[5] | $ 43,600 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[4],[5] | 3.40% | |
A++ (Superior) | Reinsurance Recoverable | Reinsurer Concentration Risk | Chubb Corporation | |||
Ceded Credit Risk [Line Items] | |||
Reinsurance Recoverable | [2],[4] | $ 91,400 | |
Reinsurance recoverable as percentage of total reinsurance recoverables | [2],[4] | 7.20% | |
[1] | Approximately 94 percent of our reinsurance recoverables balance as of December 31, 2016 was due from reinsurers having an A.M. Best financial strength rating of A (Excellent) or higher. | ||
[2] | Reinsurance recoverables reflect amounts due from one or more reinsurance subsidiaries of the listed company. | ||
[3] | Represents reinsurance recoverables secured by funds held, trust agreements and letters of credit. | ||
[4] | Represents the A.M. Best financial strength rating for the applicable reinsurance subsidiary or subsidiaries from which the reinsurance recoverable is due. | ||
[5] | In December 2016, Fairfax Financial Holdings Ltd announced its agreement to acquire Allied World Assurance Company Holdings, AG. |
Information Regarding Concent60
Information Regarding Concentration of Reinsurance Recoverables and Ratings Profile of its Reinsurers (Parenthetical) (Detail) - Reinsurance Recoverable - Reinsurer Concentration Risk | 12 Months Ended | |
Dec. 31, 2016 | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable as percentage of total reinsurance recoverables | 100.00% | [1],[2] |
A (Excellent) or higher | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable as percentage of total reinsurance recoverables | 94.00% | |
[1] | Approximately 94 percent of our reinsurance recoverables balance as of December 31, 2016 was due from reinsurers having an A.M. Best financial strength rating of A (Excellent) or higher. | |
[2] | Reinsurance recoverables reflect amounts due from one or more reinsurance subsidiaries of the listed company. |
Reinsurance Ceded - Additional
Reinsurance Ceded - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Effects of Reinsurance [Line Items] | |||
Ceded loss and loss adjustment expenses incurred | $ 325.8 | $ 309.6 | $ 250.3 |
AIHL Re Limited Liability Company reinsurance of Pacific Compensation Insurance Company | Alleghany Corporation | Financial Guarantee | |||
Effects of Reinsurance [Line Items] | |||
Guarantee amount related to intercompany reinsurance agreement | 100 | ||
AIHL Re Limited Liability Company reinsurance of Pacific Compensation Insurance Company | Pacific Compensation Insurance Company | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage before co-participation | $ 100 | ||
Accident year stop-loss coverage initiation point | 75.00% | ||
AIHL Re Limited Liability Company reinsurance of Pacific Compensation Insurance Company | Minimum | Pacific Compensation Insurance Company | |||
Effects of Reinsurance [Line Items] | |||
Accident year covered by stop-loss coverage | 2,013 | ||
AIHL Re Limited Liability Company reinsurance of Pacific Compensation Insurance Company | Maximum | Pacific Compensation Insurance Company | |||
Effects of Reinsurance [Line Items] | |||
Accident year covered by stop-loss coverage | 2,017 | ||
AIHL Re Limited Liability Company reinsurance of CapSpecialty Incorporated | Alleghany Corporation | Financial Guarantee | |||
Effects of Reinsurance [Line Items] | |||
Guarantee amount related to intercompany reinsurance agreement | $ 50 | ||
RSUI | |||
Effects of Reinsurance [Line Items] | |||
Description of reinsurance program | RSUI’s catastrophe reinsurance program covers catastrophe risks including, among others, windstorms and earthquakes. As of December 31, 2016, the catastrophe reinsurance program consisted of three layers, with portions of the first and second layers placed on May 1, 2015 and May 1, 2016 and portions of the third layer placed on May 1, 2014 and May 1, 2016. The catastrophe reinsurance program provides coverage for $600.0 million of losses in excess of a $200.0 million net retention after application of surplus share treaties and facultative reinsurance. The first layer provides coverage for $300.0 million of losses, subject to a 5.0 percent co-participation by RSUI in excess of $200.0 million, the second layer provides coverage for $100.0 million of losses in excess of $500.0 million, with no co-participation by RSUI and the third layer provides coverage for $200.0 million of losses in excess of $600.0 million, with no co-participation by RSUI. The first and second layers of coverage include the following expiration terms: approximately 34 percent of coverage limits, which originally expired on April 30, 2016 and was renewed May 1, 2016, currently expires on April 30, 2019; approximately 33 percent of coverage limits expire on April 30, 2017; and approximately 33 percent of coverage limits expire on April 30, 2018. The third layer of coverage originally expired on April 30, 2017. However, effective May 1, 2016, approximately 39 percent of the third layer of coverage was cancelled and replaced with the same coverage for a three year period expiring on April 30, 2019. The remaining coverage limits expire on April 30, 2017. In addition, RSUI’s property per risk reinsurance program runs on an annual basis from May 1 to the following April 30 and thus expired on April 30, 2016. On May 1, 2016, the property per risk program was renewed and the new program will expire on April 30, 2017. For the 2016 to 2017 period, RSUI’s property per risk reinsurance program provides coverage for $90.0 million of losses, subject to a 10.0 percent co-participation by RSUI, in excess of a $10.0 million net retention per risk after application of surplus share treaties and facultative reinsurance. | ||
RSUI | Current Catastrophe Reinsurance Program | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage before co-participation | $ 600 | ||
Net retention | 200 | ||
RSUI | Current Catastrophe Reinsurance Program | Layer 1 | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage before co-participation | 300 | ||
Net retention | $ 200 | ||
Percentage of co-participation | 5.00% | ||
RSUI | Current Catastrophe Reinsurance Program | Layer 1 | Period 2 | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage initiation date | May 1, 2015 | ||
Reinsurance coverage expiration date | Apr. 30, 2017 | ||
Percentage of reinsurance program layer | 33.00% | ||
RSUI | Current Catastrophe Reinsurance Program | Layer 1 | Period 3 | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage initiation date | May 1, 2015 | ||
Reinsurance coverage expiration date | Apr. 30, 2018 | ||
Percentage of reinsurance program layer | 33.00% | ||
RSUI | Current Catastrophe Reinsurance Program | Layer 1 | Period 1 | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage initiation date | May 1, 2016 | ||
Reinsurance coverage expiration date | Apr. 30, 2019 | ||
Percentage of reinsurance program layer | 34.00% | ||
RSUI | Current Catastrophe Reinsurance Program | Layer 2 | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage before co-participation | $ 100 | ||
Net retention | $ 500 | ||
RSUI | Current Catastrophe Reinsurance Program | Layer 2 | Period 2 | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage initiation date | May 1, 2015 | ||
Reinsurance coverage expiration date | Apr. 30, 2017 | ||
Percentage of reinsurance program layer | 33.00% | ||
RSUI | Current Catastrophe Reinsurance Program | Layer 2 | Period 3 | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage initiation date | May 1, 2015 | ||
Reinsurance coverage expiration date | Apr. 30, 2018 | ||
Percentage of reinsurance program layer | 33.00% | ||
RSUI | Current Catastrophe Reinsurance Program | Layer 2 | Period 1 | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage initiation date | May 1, 2016 | ||
Reinsurance coverage expiration date | Apr. 30, 2019 | ||
Percentage of reinsurance program layer | 34.00% | ||
RSUI | Current Catastrophe Reinsurance Program | Layer 3 | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage before co-participation | $ 200 | ||
Net retention | $ 600 | ||
RSUI | Current Catastrophe Reinsurance Program | Layer 3 | Period 2 | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage initiation date | May 1, 2016 | ||
Reinsurance coverage expiration date | Apr. 30, 2019 | ||
Percentage of reinsurance program layer | 39.00% | ||
RSUI | Current Catastrophe Reinsurance Program | Layer 3 | Period 1 | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage initiation date | May 1, 2014 | ||
Reinsurance coverage expiration date | Apr. 30, 2017 | ||
RSUI | Property Per Risk | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage before co-participation | $ 90 | ||
Net retention | $ 10 | ||
Percentage of co-participation | 10.00% | ||
Reinsurance coverage initiation date | May 1, 2016 | ||
Reinsurance coverage expiration date | Apr. 30, 2017 | ||
CapSpecialty Incorporated | AIHL Re Limited Liability Company reinsurance of CapSpecialty Incorporated | |||
Effects of Reinsurance [Line Items] | |||
Reinsurance coverage before co-participation | $ 50 |
Property and Casualty Premiums
Property and Casualty Premiums Written and Earned (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Effects of Reinsurance [Line Items] | |||
Net premiums written | $ 5,091,800 | $ 4,489,200 | $ 4,497,500 |
Net premiums earned | 4,975,777 | 4,230,286 | 4,410,647 |
Property and Casualty Insurance | |||
Effects of Reinsurance [Line Items] | |||
Gross premiums written - direct | 1,490,300 | 1,505,600 | 1,529,400 |
Gross premiums written - assumed | 4,276,800 | 3,616,600 | 3,567,200 |
Ceded premiums written | (675,300) | (633,000) | (599,100) |
Net premiums written | 5,091,800 | 4,489,200 | 4,497,500 |
Gross premiums earned - direct | 1,871,100 | 1,515,900 | 1,517,000 |
Gross premiums earned - assumed | 3,833,900 | 3,403,300 | 3,540,500 |
Ceded premiums earned | (729,200) | (688,900) | (646,900) |
Net premiums earned | $ 4,975,800 | $ 4,230,300 | $ 4,410,600 |
Activity in the Liability for L
Activity in the Liability for Loss and Loss Adjustment Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||||||
Reserves as of January 1 | $ 10,799,242 | $ 11,597,200 | $ 11,952,500 | |||
Less: reinsurance recoverables | [1] | 1,169,300 | 1,289,400 | 1,302,100 | ||
Net reserves as of January 1 | 9,629,900 | 10,307,800 | 10,650,400 | |||
Other adjustments | 2,400 | (1,900) | 56,900 | [2] | ||
Incurred loss and LAE, net of reinsurance, related to: | ||||||
Current year | 3,285,200 | 2,555,300 | 2,709,700 | |||
Prior years | (368,000) | (215,500) | (215,200) | |||
Total incurred loss and LAE, net of reinsurance | 2,917,166 | 2,339,790 | 2,494,565 | |||
Paid loss and LAE, net of reinsurance, related to: | ||||||
Current year | [3] | 734,300 | 417,600 | 520,800 | ||
Prior years | [3] | 1,866,500 | 2,390,400 | 2,178,100 | ||
Total paid loss and LAE, net of reinsurance | [3] | 2,600,800 | 2,808,000 | 2,698,900 | ||
Foreign exchange effect | (97,700) | (207,800) | (195,100) | |||
Net reserves as of December 31 | 9,851,000 | [4] | 9,629,900 | 10,307,800 | ||
Reinsurance recoverables as of December 31 | [1] | 1,236,200 | [4] | 1,169,300 | 1,289,400 | |
Reserves as of December 31 | $ 11,087,199 | [4] | $ 10,799,242 | $ 11,597,200 | ||
[1] | Reinsurance recoverables in this table include only ceded loss and LAE reserves. | |||||
[2] | Represents reserves acquired in connection with a loss portfolio transfer transaction. | |||||
[3] | Includes paid losses, net of reinsurance, related to commutations. | |||||
[4] | Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. |
(Favorable) Unfavorable Prior A
(Favorable) Unfavorable Prior Accident Year Loss Reserve Development (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | $ (368) | $ (215.5) | $ (215.2) | ||||
Reinsurance Segment | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (293.5) | (208.3) | (182.4) | ||||
Reinsurance Segment | Property | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (105.7) | (76.7) | (73.1) | ||||
Reinsurance Segment | Property | Property Catastrophe | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (14.2) | [1] | (28) | [2] | (17.3) | [3] | |
Reinsurance Segment | Property | Property Non-catastrophe | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (91.5) | [4] | (48.7) | [5] | (55.8) | [6] | |
Reinsurance Segment | Casualty & Other | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (187.8) | (131.6) | (109.3) | ||||
Reinsurance Segment | Casualty & Other | All Other Casualty and Other | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (177) | [7] | (157.7) | [8] | (96.6) | [9] | |
Reinsurance Segment | Casualty & Other | The Medical Malpractice Treaties | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | [10] | (10.8) | (12.1) | (12.7) | |||
Reinsurance Segment | Casualty & Other | A&E Commutations | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | [11] | 38.2 | |||||
Insurance Segment | RSUI | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (68.3) | (11.9) | (35.4) | ||||
Insurance Segment | RSUI | Property and Other Insurance | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (33) | [12] | (9) | [13] | (5.3) | [14] | |
Insurance Segment | RSUI | Casualty Insurance | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (35.3) | [15] | (2.9) | [16] | (30.1) | [17] | |
Insurance Segment | CapSpecialty Incorporated | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (4.2) | 4.7 | 0.2 | ||||
Insurance Segment | CapSpecialty Incorporated | Ongoing Lines Of Business | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (0.3) | 11 | [18] | 0.2 | |||
Insurance Segment | CapSpecialty Incorporated | Terminated Program Business | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | [19] | (1.9) | $ (6.3) | ||||
Insurance Segment | CapSpecialty Incorporated | Asbestos and Environmental | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (2) | ||||||
Insurance Segment | Pacific Comp | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | $ (2) | [20] | $ 2.4 | [21] | |||
[1] | Reflects favorable prior accident year loss reserve development from several catastrophes that occurred in the 2010 through 2015 accident years. | ||||||
[2] | Includes favorable prior accident year loss reserve development of ($27.7) million from Super Storm Sandy in 2012 and various smaller amounts on catastrophes that occurred in the 2010, 2011, 2013 and 2014 accident years, partially offset by unfavorable prior accident year development from the New Zealand earthquake in 2010. | ||||||
[3] | Includes favorable prior accident year loss reserve development of ($1.6) million from Super Storm Sandy in 2012 and ($15.7) million of net favorable prior accident year loss reserve development from other catastrophes. The ($15.7) million primarily reflects favorable prior accident year loss reserve development from several catastrophes that occurred primarily in the 2011 and 2013 accident years, partially offset by unfavorable prior accident year loss reserve development from the New Zealand earthquake in 2010. | ||||||
[4] | Reflects favorable prior accident year loss reserve development primarily related to the 2011 and 2015 accident years. | ||||||
[5] | Reflects favorable prior accident year loss reserve development primarily related to the 2013 and 2014 accident years. | ||||||
[6] | Reflects favorable prior accident year loss reserve development primarily related to the 2012 accident year and, to a lesser extent, the 2011 accident year. | ||||||
[7] | Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2003 through 2015 accident years. | ||||||
[8] | Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2005 through 2014 accident years, including ($30.7) million of favorable prior accident year development related to French medical malpractice loss reserves commuted in the fourth quarter of 2015 with a European cedant, partially offset by unfavorable prior accident year development from the 2004 and prior accident years. | ||||||
[9] | Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2003 through 2007 and 2010 through 2011 accident years, partially offset by unfavorable prior accident year loss reserve development from the 2013 accident year and the 2002 and prior accident years. | ||||||
[10] | Represents certain medical malpractice treaties pursuant to which the increased underwriting profits created by the favorable prior accident year loss reserve development are largely retained by the cedants. As a result, the favorable prior accident year development is largely offset by an increase in profit commission expense incurred when such favorable prior accident year loss reserve development occurs. | ||||||
[11] | Represents unfavorable prior accident year loss reserve development related to a commutation and release agreement entered into on November 30, 2015 by TransRe with AIG Property Casualty, Inc., National Indemnity Company and Resolute Management, Inc. with respect to certain reinsurance contracts (the "Commutation Agreement"), including contracts covering asbestos-related illness and environmental impairment liabilities for 1986 and prior years (the "Commuted A&E Liabilities"). | ||||||
[12] | Includes favorable prior accident year loss reserve development of ($20.6) million from Super Storm Sandy in 2012 and various other smaller amounts primarily from the non-catastrophe property lines of business in recent accident years. | ||||||
[13] | Primarily reflects favorable prior accident year development of ($4.1) million from Super Storm Sandy in 2012, net of reinsurance, and favorable prior accident year loss reserve development related to unallocated LAE reserves. | ||||||
[14] | Primarily reflects favorable prior accident year development on unallocated LAE reserves and prior year catastrophe loss reserves from recent accident years. | ||||||
[15] | Primarily reflects favorable prior accident year loss reserve development in the umbrella/excess, general liability and professional liability lines of business related to the 2006 through 2012 accident years. | ||||||
[16] | Primarily reflects favorable prior accident year loss reserve development in the umbrella/excess, general liability and professional liability lines of business related to the 2006 through 2011 accident years, partially offset by unfavorable prior accident year loss reserve development in the directors' and officers' liability lines of business related to the 2011 through 2014 accident years. | ||||||
[17] | Primarily reflects favorable prior accident year loss reserve development in the professional liability, general liability and umbrella/excess lines of business, and primarily related to the 2006 through 2010 accident years, partially offset by unfavorable prior accident year loss reserve development in the directors' and officers' liability lines of business in the 2011 and 2012 accident years. | ||||||
[18] | Primarily reflects unfavorable prior accident year loss reserve development related to the casualty lines of business from the 2011 through 2013 accident years. | ||||||
[19] | Represents certain specialty lines of business written through a program administrator in connection with a terminated program related to the 2010 and 2009 accident years and reflects (favorable) loss emergence compared with loss emergence patterns assumed in earlier periods for such business. | ||||||
[20] | Primarily reflects favorable prior accident year loss reserve development related to 2012 and prior accident years. | ||||||
[21] | Primarily reflects unfavorable prior accident year loss reserve development related to 2009 and prior accident years. |
(Favorable) Unfavorable Prior65
(Favorable) Unfavorable Prior Accident Year Loss Reserve Development (Parenthetical) (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | $ (368) | $ (215.5) | $ (215.2) | ||||
Reinsurance Segment | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (293.5) | (208.3) | (182.4) | ||||
Reinsurance Segment | Property | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (105.7) | (76.7) | (73.1) | ||||
Reinsurance Segment | Casualty & Other | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (187.8) | (131.6) | (109.3) | ||||
Insurance Segment | RSUI | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (68.3) | (11.9) | (35.4) | ||||
Property Catastrophe | Reinsurance Segment | Property | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (14.2) | [1] | (28) | [2] | (17.3) | [3] | |
Property Catastrophe | Super Storm Sandy | Reinsurance Segment | Property | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (27.7) | (1.6) | |||||
Property Catastrophe | Other Catastrophe | Reinsurance Segment | Property | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (15.7) | ||||||
All Other Casualty and Other | Reinsurance Segment | Casualty & Other | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (177) | [4] | (157.7) | [5] | (96.6) | [6] | |
All Other Casualty and Other | Reinsurance Segment | Casualty & Other | French Medical Malpractice Commutation with European Client | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | $ (30.7) | ||||||
Property and Other Insurance | Insurance Segment | RSUI | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | (33) | [7] | (9) | [8] | $ (5.3) | [9] | |
Property and Other Insurance | Super Storm Sandy | Insurance Segment | RSUI | |||||||
Claims Development [Line Items] | |||||||
Claims incurred related to prior years | $ (20.6) | $ (4.1) | |||||
[1] | Reflects favorable prior accident year loss reserve development from several catastrophes that occurred in the 2010 through 2015 accident years. | ||||||
[2] | Includes favorable prior accident year loss reserve development of ($27.7) million from Super Storm Sandy in 2012 and various smaller amounts on catastrophes that occurred in the 2010, 2011, 2013 and 2014 accident years, partially offset by unfavorable prior accident year development from the New Zealand earthquake in 2010. | ||||||
[3] | Includes favorable prior accident year loss reserve development of ($1.6) million from Super Storm Sandy in 2012 and ($15.7) million of net favorable prior accident year loss reserve development from other catastrophes. The ($15.7) million primarily reflects favorable prior accident year loss reserve development from several catastrophes that occurred primarily in the 2011 and 2013 accident years, partially offset by unfavorable prior accident year loss reserve development from the New Zealand earthquake in 2010. | ||||||
[4] | Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2003 through 2015 accident years. | ||||||
[5] | Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2005 through 2014 accident years, including ($30.7) million of favorable prior accident year development related to French medical malpractice loss reserves commuted in the fourth quarter of 2015 with a European cedant, partially offset by unfavorable prior accident year development from the 2004 and prior accident years. | ||||||
[6] | Generally reflects favorable prior accident year loss reserve development in a variety of casualty & other lines of business primarily from the 2003 through 2007 and 2010 through 2011 accident years, partially offset by unfavorable prior accident year loss reserve development from the 2013 accident year and the 2002 and prior accident years. | ||||||
[7] | Includes favorable prior accident year loss reserve development of ($20.6) million from Super Storm Sandy in 2012 and various other smaller amounts primarily from the non-catastrophe property lines of business in recent accident years. | ||||||
[8] | Primarily reflects favorable prior accident year development of ($4.1) million from Super Storm Sandy in 2012, net of reinsurance, and favorable prior accident year loss reserve development related to unallocated LAE reserves. | ||||||
[9] | Primarily reflects favorable prior accident year development on unallocated LAE reserves and prior year catastrophe loss reserves from recent accident years. |
Supplemental Information About
Supplemental Information About Incurred and Paid Loss and LAE Development - Reinsurance Segment - Property (Detail) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 | Dec. 31, 2008 | Dec. 31, 2007 | ||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | $ 9,851 | [1] | $ 9,629.9 | $ 10,307.8 | $ 10,650.4 | |||||||
Reinsurance Segment | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 7,944.4 | ||||||||||
Reinsurance Segment | Property | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 | 2.8 | |||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 846 | ||||||||||
Reinsurance Segment | Property | Accident Year 2007 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 415.3 | 415.8 | 416.7 | 418.4 | $ 419.6 | $ 420.9 | $ 423.8 | $ 426.4 | $ 437.5 | $ 508.3 | ||
Paid Loss and LAE, Net of Reinsurance | 411 | 411 | 410 | 409.8 | 407.5 | 402.7 | 393.8 | 362.8 | 306.2 | $ 128.4 | ||
Reinsurance Segment | Property | Accident Year 2008 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 508.8 | 508.7 | 509.4 | 510.9 | 511.9 | 515.9 | 510.9 | 508 | 645 | |||
Paid Loss and LAE, Net of Reinsurance | 505.6 | 505 | 503.1 | 501.5 | 495 | 477.1 | 435.2 | 350.8 | $ 163.3 | |||
Reinsurance Segment | Property | Accident Year 2009 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 353.7 | 355.9 | 357.6 | 357.1 | 358 | 359.7 | 377.4 | 489.3 | ||||
Paid Loss and LAE, Net of Reinsurance | 345.7 | 347.9 | 345.5 | 340.6 | 332.4 | 310.9 | 251.7 | $ 114.7 | ||||
Reinsurance Segment | Property | Accident Year 2010 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 609.9 | 606 | 581.2 | 540.4 | 528 | 527.1 | 615.6 | |||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 25.4 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 563.7 | 540.1 | 513.5 | 472.3 | 418.9 | 349 | $ 169.3 | |||||
Reinsurance Segment | Property | Accident Year 2011 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 1,217.1 | 1,235.2 | 1,240.7 | 1,269.4 | 1,342.3 | 1,351.2 | ||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 9.6 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 1,187.2 | 1,171 | 1,129.2 | 1,014.3 | 796.4 | $ 407.8 | ||||||
Reinsurance Segment | Property | Accident Year 2012 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 478.1 | 495.6 | 530.3 | 579.1 | 697.2 | |||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 21.3 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 438 | 416.7 | 377.8 | 268.9 | $ 90.3 | |||||||
Reinsurance Segment | Property | Accident Year 2013 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 422.1 | 444.6 | 470.6 | 501.2 | ||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 21.1 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 389.8 | 361 | 277.4 | $ 113.1 | ||||||||
Reinsurance Segment | Property | Accident Year 2014 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 451.3 | 464.8 | 496.4 | |||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 37.4 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 360 | 297.6 | $ 109.4 | |||||||||
Reinsurance Segment | Property | Accident Year 2015 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 332 | 368.8 | ||||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 59.7 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 217.7 | $ 96 | ||||||||||
Reinsurance Segment | Property | Accident Year 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 684.1 | |||||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 262.2 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 210.5 | |||||||||||
Reinsurance Segment | Property | Accident Year 2007 through 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 5,472.4 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 4,629.2 | |||||||||||
[1] | Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. |
Supplemental Information Abou67
Supplemental Information About Incurred and Paid Loss and LAE Development - Reinsurance Segment - Casualty (Detail) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 | Dec. 31, 2008 | Dec. 31, 2007 | ||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | $ 9,851 | [1] | $ 9,629.9 | $ 10,307.8 | $ 10,650.4 | |||||||
Reinsurance Segment | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 7,944.4 | ||||||||||
Reinsurance Segment | Casualty & Other | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 | 767.1 | |||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 7,098.4 | ||||||||||
Reinsurance Segment | Casualty & Other | Accident Year 2007 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 1,928.4 | 1,938 | 1,953.8 | 1,990.2 | $ 1,998.4 | $ 2,014.2 | $ 2,033.2 | $ 2,038.1 | $ 2,024 | $ 2,043.1 | ||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 122.3 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 1,695.4 | 1,657.3 | 1,572.8 | 1,495 | 1,402.1 | 1,282.4 | 1,137.3 | 912.8 | 721.7 | $ 354 | ||
Reinsurance Segment | Casualty & Other | Accident Year 2008 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 2,293.5 | 2,304.4 | 2,324.8 | 2,323.3 | 2,313.3 | 2,294.4 | 2,311.8 | 2,301 | 2,262.7 | |||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 154.3 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 1,972.5 | 1,912 | 1,809.2 | 1,676.2 | 1,515.3 | 1,337.2 | 1,137 | 853.4 | $ 452.8 | |||
Reinsurance Segment | Casualty & Other | Accident Year 2009 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 2,186 | 2,193.4 | 2,171.6 | 2,165.9 | 2,168.7 | 2,177.5 | 2,188.7 | 2,228.9 | ||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 170 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 1,828.7 | 1,749.2 | 1,597.3 | 1,445.2 | 1,285.3 | 1,089.8 | 850.2 | $ 482 | ||||
Reinsurance Segment | Casualty & Other | Accident Year 2010 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 1,927.9 | 1,953.2 | 1,982.7 | 2,041.8 | 2,076.5 | 2,108.9 | 2,123.1 | |||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 245.5 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 1,541.8 | 1,458.7 | 1,305.4 | 1,154.9 | 985 | 779.7 | $ 438.8 | |||||
Reinsurance Segment | Casualty & Other | Accident Year 2011 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 1,913.6 | 1,932.1 | 1,967.5 | 2,002.2 | 2,033.2 | 2,027.2 | ||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 283.7 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 1,475.3 | 1,360.6 | 1,194.3 | 959.1 | 695.8 | $ 406.1 | ||||||
Reinsurance Segment | Casualty & Other | Accident Year 2012 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 1,817 | 1,866.3 | 1,932.7 | 1,937.4 | 1,899.8 | |||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 364.2 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 1,264.1 | 1,109.3 | 941.1 | 721.3 | $ 401.7 | |||||||
Reinsurance Segment | Casualty & Other | Accident Year 2013 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 1,600.9 | 1,637.6 | 1,671 | 1,649.3 | ||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 453.7 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 959.3 | 789.9 | 608.6 | $ 287.6 | ||||||||
Reinsurance Segment | Casualty & Other | Accident Year 2014 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 1,603.1 | 1,624 | 1,652.2 | |||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 603.6 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 752.8 | 528.6 | $ 281 | |||||||||
Reinsurance Segment | Casualty & Other | Accident Year 2015 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 1,567.7 | 1,558.2 | ||||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 789.4 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 509.5 | $ 250.7 | ||||||||||
Reinsurance Segment | Casualty & Other | Accident Year 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 1,894.7 | |||||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | 1,295.2 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | 402.1 | |||||||||||
Reinsurance Segment | Casualty & Other | Accident Year 2007 through 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 18,732.8 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 12,401.5 | |||||||||||
[1] | Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. |
Supplemental Information Abou68
Supplemental Information About Incurred and Paid Loss and LAE Development - Insurance Segment - RSUI - Property (Detail) $ in Millions | Dec. 31, 2016USD ($)Claim | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) | Dec. 31, 2011USD ($) | Dec. 31, 2010USD ($) | Dec. 31, 2009USD ($) | Dec. 31, 2008USD ($) | Dec. 31, 2007USD ($) | ||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | $ 9,851 | [1] | $ 9,629.9 | $ 10,307.8 | $ 10,650.4 | |||||||
Insurance Segment | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 1,906.6 | ||||||||||
Insurance Segment | RSUI | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 1,437.5 | ||||||||||
Insurance Segment | RSUI | Property Insurance | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 | 2.1 | |||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 208.5 | ||||||||||
Insurance Segment | RSUI | Property Insurance | Accident Year 2007 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 65.8 | 65.8 | 65.8 | 64.8 | $ 64.5 | $ 64.7 | $ 64.2 | $ 66.9 | $ 67.8 | $ 69.2 | ||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 0.6 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 1,192 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 65.1 | 65 | 64.9 | 63.4 | 63.1 | 62.9 | 61.4 | 58.5 | 47 | $ 24.7 | ||
Insurance Segment | RSUI | Property Insurance | Accident Year 2008 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 192.5 | 192.4 | 192.2 | 192.8 | 193.3 | 183.8 | 178.2 | 181.3 | 176 | |||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 0.8 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 1,839 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 191.6 | 191.2 | 190.6 | 189 | 187.6 | 173.1 | 155.3 | 138.8 | $ 65.3 | |||
Insurance Segment | RSUI | Property Insurance | Accident Year 2009 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 64.7 | 64.5 | 63.7 | 63.1 | 62.5 | 60.1 | 63.1 | 78.3 | ||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 0.9 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 1,313 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 63.6 | 63.3 | 61.9 | 61.4 | 58.9 | 54.3 | 51 | $ 36.6 | ||||
Insurance Segment | RSUI | Property Insurance | Accident Year 2010 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 109.9 | 109.8 | 104.2 | 105.7 | 101.8 | 101.7 | 110.2 | |||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 1.1 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 1,630 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 101.5 | 101.1 | 100.6 | 98.6 | 92.4 | 83.6 | $ 53 | |||||
Insurance Segment | RSUI | Property Insurance | Accident Year 2011 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 159.3 | 159 | 159.9 | 160.5 | 162 | 168.8 | ||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 1.5 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 2,202 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 157.2 | 156.1 | 154.3 | 144 | 118.4 | $ 61 | ||||||
Insurance Segment | RSUI | Property Insurance | Accident Year 2012 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 235.1 | 256.1 | 258.6 | 262.5 | 270.9 | |||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 6.6 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 2,309 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 202.4 | 193.5 | 181.9 | 157.5 | $ 62 | |||||||
Insurance Segment | RSUI | Property Insurance | Accident Year 2013 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 152.1 | 150.4 | 157.2 | 157.3 | ||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 3.1 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 2,387 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 141.1 | 134 | 118.7 | $ 72.7 | ||||||||
Insurance Segment | RSUI | Property Insurance | Accident Year 2014 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 155.9 | 166.2 | 170.7 | |||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 6.7 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 3,079 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 145 | 133.8 | $ 93.2 | |||||||||
Insurance Segment | RSUI | Property Insurance | Accident Year 2015 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 136.1 | 140.5 | ||||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 11.8 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 2,958 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 106.9 | $ 70.8 | ||||||||||
Insurance Segment | RSUI | Property Insurance | Accident Year 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 181.4 | |||||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 49 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 2,944 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 72 | |||||||||||
Insurance Segment | RSUI | Property Insurance | Accident Year 2007 through 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 1,452.8 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 1,246.4 | |||||||||||
[1] | Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. | |||||||||||
[2] | Represents claims reported by insured claimants. |
Supplemental Information Abou69
Supplemental Information About Incurred and Paid Loss and LAE Development - Insurance Segment - RSUI - Casualty (Detail) $ in Millions | Dec. 31, 2016USD ($)Claim | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) | Dec. 31, 2011USD ($) | Dec. 31, 2010USD ($) | Dec. 31, 2009USD ($) | Dec. 31, 2008USD ($) | Dec. 31, 2007USD ($) | ||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | $ 9,851 | [1] | $ 9,629.9 | $ 10,307.8 | $ 10,650.4 | |||||||
Insurance Segment | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 1,906.6 | ||||||||||
Insurance Segment | RSUI | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 1,437.5 | ||||||||||
Insurance Segment | RSUI | Casualty Insurance | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 | 54 | |||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 1,229 | ||||||||||
Insurance Segment | RSUI | Casualty Insurance | Accident Year 2007 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 201.7 | 206.4 | 215.5 | 225.7 | $ 232.6 | $ 243.9 | $ 252.2 | $ 253.6 | $ 257.6 | $ 252.8 | ||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 22.1 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 5,992 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 171.9 | 170.5 | 164.2 | 158.8 | 151.4 | 117.4 | 88.9 | 63 | 24.2 | $ 4.1 | ||
Insurance Segment | RSUI | Casualty Insurance | Accident Year 2008 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 216.9 | 220.9 | 230.8 | 237 | 245.3 | 254.8 | 260.6 | 255 | 255 | |||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 27.5 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 7,105 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 179.4 | 171.3 | 164.2 | 157.4 | 145.3 | 124.4 | 89.5 | 35.1 | $ 9.5 | |||
Insurance Segment | RSUI | Casualty Insurance | Accident Year 2009 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 212 | 221.8 | 232.2 | 236.3 | 236.3 | 234.4 | 233.7 | 230.1 | ||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 34.8 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 6,843 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 166.4 | 157.5 | 149.5 | 136.9 | 101.9 | 73.2 | 38 | $ 7.2 | ||||
Insurance Segment | RSUI | Casualty Insurance | Accident Year 2010 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 177 | 178.6 | 194.6 | 203.4 | 204.1 | 204.1 | 204.1 | |||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 28.9 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 6,859 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 132.9 | 128.6 | 122.6 | 90.1 | 70.1 | 30.9 | $ 4.7 | |||||
Insurance Segment | RSUI | Casualty Insurance | Accident Year 2011 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 206.8 | 211.6 | 212.1 | 208.3 | 205.9 | 205.9 | ||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 45.3 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 7,459 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 138.5 | 118.4 | 100.3 | 66.7 | 31.9 | $ 6.5 | ||||||
Insurance Segment | RSUI | Casualty Insurance | Accident Year 2012 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 238.9 | 242.8 | 230.3 | 226.3 | 226.3 | |||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 72.6 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 7,518 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 144 | 125.5 | 96 | 38.4 | $ 6.8 | |||||||
Insurance Segment | RSUI | Casualty Insurance | Accident Year 2013 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 280.1 | 277.6 | 264.8 | 264.8 | ||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 99.4 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 8,503 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 146.2 | 103.4 | 50 | $ 10.1 | ||||||||
Insurance Segment | RSUI | Casualty Insurance | Accident Year 2014 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 321.1 | 322.7 | 292 | |||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 144.3 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 9,870 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 130.1 | 69.5 | $ 13 | |||||||||
Insurance Segment | RSUI | Casualty Insurance | Accident Year 2015 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 300.2 | 300.2 | ||||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 207.6 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 8,661 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 47.3 | $ 9 | ||||||||||
Insurance Segment | RSUI | Casualty Insurance | Accident Year 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 290.7 | |||||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 252.2 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 7,156 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 13.7 | |||||||||||
Insurance Segment | RSUI | Casualty Insurance | Accident Year 2007 through 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 2,445.4 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 1,270.4 | |||||||||||
[1] | Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. | |||||||||||
[2] | Represents claims reported by insured claimants. |
Supplemental Information Abou70
Supplemental Information About Incurred and Paid Loss and LAE Development - Insurance Segment - CapSpecialty (Detail) $ in Millions | Dec. 31, 2016USD ($)Claim | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) | Dec. 31, 2011USD ($) | Dec. 31, 2010USD ($) | Dec. 31, 2009USD ($) | Dec. 31, 2008USD ($) | Dec. 31, 2007USD ($) | ||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | $ 9,851 | [1] | $ 9,629.9 | $ 10,307.8 | $ 10,650.4 | |||||||
Insurance Segment | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 1,906.6 | ||||||||||
Insurance Segment | CapSpecialty Incorporated | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 | [2] | 10.8 | ||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1],[2] | 236.4 | ||||||||||
Insurance Segment | CapSpecialty Incorporated | Accident Year 2007 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | [2] | 107.2 | 107.9 | 109.7 | 109.3 | $ 109.9 | $ 109.2 | $ 108.4 | $ 103.6 | $ 107.8 | $ 110.2 | |
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | [2] | $ 1.1 | ||||||||||
Cumulative Number of Reported Claims | Claim | [2],[3] | 11,028 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | [2] | $ 107.9 | 107.8 | 106.8 | 105.7 | 104.2 | 99.3 | 91.1 | 74.9 | 56.4 | $ 30.7 | |
Insurance Segment | CapSpecialty Incorporated | Accident Year 2008 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | [2] | 96.8 | 96.5 | 94.2 | 94.3 | 89.6 | 90.1 | 93.2 | 97.1 | 102.6 | ||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | [2] | $ 0.5 | ||||||||||
Cumulative Number of Reported Claims | Claim | [2],[3] | 8,835 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | [2] | $ 93.1 | 91.7 | 90.3 | 87.2 | 82.4 | 74.6 | 63.9 | 43.8 | $ 26.3 | ||
Insurance Segment | CapSpecialty Incorporated | Accident Year 2009 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | [2] | 98 | 97.9 | 99 | 98.8 | 95.7 | 90.4 | 93.3 | 92.2 | |||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | [2] | $ 0.7 | ||||||||||
Cumulative Number of Reported Claims | Claim | [2],[3] | 8,527 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | [2] | $ 95.7 | 94.4 | 92.7 | 87.2 | 78.2 | 62.5 | 50.1 | $ 27.7 | |||
Insurance Segment | CapSpecialty Incorporated | Accident Year 2010 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | [2] | 129.5 | 129.8 | 134.5 | 134.8 | 117.9 | 110.8 | 93.2 | ||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | [2] | $ 3 | ||||||||||
Cumulative Number of Reported Claims | Claim | [2],[3] | 8,205 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | [2] | $ 121.6 | 119.2 | 111 | 98.1 | 78.4 | 56.2 | $ 22 | ||||
Insurance Segment | CapSpecialty Incorporated | Accident Year 2011 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | [2] | 78.4 | 79.4 | 76.9 | 74.4 | 71.2 | 74 | |||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | [2] | $ 2.5 | ||||||||||
Cumulative Number of Reported Claims | Claim | [2],[3] | 5,682 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | [2] | $ 69.8 | 67.3 | 57.7 | 44.7 | 31.9 | $ 16.3 | |||||
Insurance Segment | CapSpecialty Incorporated | Accident Year 2012 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | [2] | 69.7 | 69.3 | 66.2 | 71.8 | 72.7 | ||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | [2] | $ 2.7 | ||||||||||
Cumulative Number of Reported Claims | Claim | [2],[3] | 5,250 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | [2] | $ 63.3 | 57.2 | 46.9 | 38.6 | $ 18.6 | ||||||
Insurance Segment | CapSpecialty Incorporated | Accident Year 2013 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | [2] | 84.4 | 85.2 | 81.4 | 78.7 | |||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | [2] | $ 4.6 | ||||||||||
Cumulative Number of Reported Claims | Claim | [2],[3] | 5,106 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | [2] | $ 69.6 | 62 | 48 | $ 23.4 | |||||||
Insurance Segment | CapSpecialty Incorporated | Accident Year 2014 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | [2] | 101 | 102.7 | 102.8 | ||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | [2] | $ 14.4 | ||||||||||
Cumulative Number of Reported Claims | Claim | [2],[3] | 5,772 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | [2] | $ 71.9 | 56.3 | $ 34 | ||||||||
Insurance Segment | CapSpecialty Incorporated | Accident Year 2015 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | [2] | 111.8 | 111 | |||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | [2] | $ 34.1 | ||||||||||
Cumulative Number of Reported Claims | Claim | [2],[3] | 5,193 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | [2] | $ 57.4 | $ 30.9 | |||||||||
Insurance Segment | CapSpecialty Incorporated | Accident Year 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | [2] | 129.4 | ||||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | [2] | $ 78 | ||||||||||
Cumulative Number of Reported Claims | Claim | [2],[3] | 4,628 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | [2] | $ 30.3 | ||||||||||
Insurance Segment | CapSpecialty Incorporated | Accident Year 2007 through 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | [2] | 1,006.2 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | [2] | $ 780.6 | ||||||||||
[1] | Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. | |||||||||||
[2] | The vast majority of the CapSpecialty's loss and LAE reserves relate to its casualty lines of business. | |||||||||||
[3] | Represents claims reported by insured claimants. |
Supplemental Information Abou71
Supplemental Information About Incurred and Paid Loss and LAE Development - Insurance Segment - PacificComp (Detail) $ in Millions | Dec. 31, 2016USD ($)Claim | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) | Dec. 31, 2011USD ($) | Dec. 31, 2010USD ($) | Dec. 31, 2009USD ($) | Dec. 31, 2008USD ($) | Dec. 31, 2007USD ($) | ||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | $ 9,851 | [1] | $ 9,629.9 | $ 10,307.8 | $ 10,650.4 | |||||||
Insurance Segment | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 1,906.6 | ||||||||||
Insurance Segment | Pacific Comp | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Unpaid loss and LAE, net of reinsurance recoverables, prior to 2007 | 15.1 | |||||||||||
Unpaid loss and LAE, net of reinsurance recoverables | [1] | 232.7 | ||||||||||
Insurance Segment | Pacific Comp | Accident Year 2007 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 123 | 123.4 | 122.8 | 121.7 | $ 118.7 | $ 116.8 | $ 113.8 | $ 112.4 | $ 105.6 | $ 90.9 | ||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 4.5 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 8,449 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 108.9 | 106.8 | 103.1 | 97.8 | 92.9 | 85.9 | 74.7 | 59.2 | 39.7 | $ 17.9 | ||
Insurance Segment | Pacific Comp | Accident Year 2008 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 109.1 | 109.9 | 110.9 | 110.8 | 108.3 | 107.3 | 100.6 | 90 | 79.1 | |||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 5.7 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 5,789 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 97.2 | 94.6 | 91.2 | 85.8 | 78.6 | 69.2 | 55.3 | 35.6 | $ 15.5 | |||
Insurance Segment | Pacific Comp | Accident Year 2009 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 83 | 82 | 82 | 80.2 | 75.8 | 74.5 | 61 | 58.2 | ||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 4.3 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 3,013 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 71.7 | 68.6 | 64.7 | 58.3 | 50.8 | 41.1 | 28 | $ 12 | ||||
Insurance Segment | Pacific Comp | Accident Year 2010 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 5.8 | 6 | 6 | 5.7 | 5.4 | 5.1 | 4.1 | |||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 0.5 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 211 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 4.9 | 4.8 | 4.5 | 4 | 3.4 | 2.7 | $ 1.4 | |||||
Insurance Segment | Pacific Comp | Accident Year 2011 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 2.8 | 3 | 3 | 3 | 2.8 | 2.8 | ||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 0.3 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 100 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 2.5 | 2.1 | 2 | 1.7 | 1.1 | $ 0.6 | ||||||
Insurance Segment | Pacific Comp | Accident Year 2012 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 14.7 | 15.1 | 15.1 | 15.1 | 14.5 | |||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 2 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 560 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 11 | 10 | 8.2 | 5.6 | $ 2.4 | |||||||
Insurance Segment | Pacific Comp | Accident Year 2013 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 29.3 | 30.4 | 30.4 | 31 | ||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 5.7 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 1,005 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 18.4 | 15.4 | 10.1 | $ 4.7 | ||||||||
Insurance Segment | Pacific Comp | Accident Year 2014 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 53.5 | 52.6 | 52.6 | |||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 8.1 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 2,218 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 30.1 | 20.8 | $ 8.8 | |||||||||
Insurance Segment | Pacific Comp | Accident Year 2015 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 76.8 | 76.6 | ||||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 25.4 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 3,362 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 24.9 | $ 10.4 | ||||||||||
Insurance Segment | Pacific Comp | Accident Year 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 104.8 | |||||||||||
Incurred But Not Reported Loss and Loss Adjustment Expense Reserves | $ 47.2 | |||||||||||
Cumulative Number of Reported Claims | Claim | [2] | 4,302 | ||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 15.6 | |||||||||||
Insurance Segment | Pacific Comp | Accident Year 2007 through 2016 | ||||||||||||
Claims Development [Line Items] | ||||||||||||
Incurred Loss and LAE, net of reinsurance | 602.8 | |||||||||||
Paid Loss and LAE, Net of Reinsurance | $ 385.2 | |||||||||||
[1] | Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. | |||||||||||
[2] | Represents claims reported by insured claimants. |
Loss and LAE Reserve Summary an
Loss and LAE Reserve Summary and Reconciliation to Consolidated Balance Sheet (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||
Gross Loss and LAE Reserves | $ 11,087,199 | [1] | $ 10,799,242 | $ 11,597,200 | $ 11,952,500 | |
Reinsurance Recoverables on Unpaid Losses | [2] | (1,236,200) | [1] | (1,169,300) | (1,289,400) | (1,302,100) |
Net Loss and LAE Reserves | 9,851,000 | [1] | $ 9,629,900 | $ 10,307,800 | $ 10,650,400 | |
Reinsurance Segment | ||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||
Gross Loss and LAE Reserves | [1] | 8,277,100 | ||||
Reinsurance Recoverables on Unpaid Losses | [1] | (332,700) | ||||
Net Loss and LAE Reserves | [1] | 7,944,400 | ||||
Reinsurance Segment | Property | ||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||
Gross Loss and LAE Reserves | [1] | 952,700 | ||||
Reinsurance Recoverables on Unpaid Losses | [1] | (106,700) | ||||
Net Loss and LAE Reserves | [1] | 846,000 | ||||
Reinsurance Segment | Casualty & Other | ||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||
Gross Loss and LAE Reserves | [1] | 7,324,400 | ||||
Reinsurance Recoverables on Unpaid Losses | [1] | (226,000) | ||||
Net Loss and LAE Reserves | [1] | 7,098,400 | ||||
Insurance Segment | ||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||
Gross Loss and LAE Reserves | [1] | 2,878,600 | ||||
Reinsurance Recoverables on Unpaid Losses | [1] | (972,000) | ||||
Net Loss and LAE Reserves | [1] | 1,906,600 | ||||
Insurance Segment | RSUI | ||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||
Gross Loss and LAE Reserves | [1] | 2,376,300 | ||||
Reinsurance Recoverables on Unpaid Losses | [1] | (938,800) | ||||
Net Loss and LAE Reserves | [1] | 1,437,500 | ||||
Insurance Segment | RSUI | Property Insurance | ||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||
Gross Loss and LAE Reserves | [1] | 395,300 | ||||
Reinsurance Recoverables on Unpaid Losses | [1] | (186,800) | ||||
Net Loss and LAE Reserves | [1] | 208,500 | ||||
Insurance Segment | RSUI | Casualty Insurance | ||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||
Gross Loss and LAE Reserves | [1] | 1,981,000 | ||||
Reinsurance Recoverables on Unpaid Losses | [1] | (752,000) | ||||
Net Loss and LAE Reserves | [1] | 1,229,000 | ||||
Insurance Segment | CapSpecialty Incorporated | ||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||
Gross Loss and LAE Reserves | [1] | 267,800 | ||||
Reinsurance Recoverables on Unpaid Losses | [1] | (31,400) | ||||
Net Loss and LAE Reserves | [1],[3] | 236,400 | ||||
Insurance Segment | Pacific Comp | ||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||
Gross Loss and LAE Reserves | [1] | 234,500 | ||||
Reinsurance Recoverables on Unpaid Losses | [1] | (1,800) | ||||
Net Loss and LAE Reserves | [1] | 232,700 | ||||
Eliminations | ||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||
Gross Loss and LAE Reserves | [1] | (68,500) | ||||
Reinsurance Recoverables on Unpaid Losses | [1] | $ 68,500 | ||||
[1] | Includes unallocated LAE, which aggregate to 1.3 percent of gross loss and LAE reserves as of December 31, 2016. Net loss and LAE Reserves by component are shown in the preceding tables, and consolidated gross loss and LAE reserves is presented in the Consolidated Balance Sheets. | |||||
[2] | Reinsurance recoverables in this table include only ceded loss and LAE reserves. | |||||
[3] | The vast majority of the CapSpecialty's loss and LAE reserves relate to its casualty lines of business. |
Loss and LAE Reserve Summary 73
Loss and LAE Reserve Summary and Reconciliation to Consolidated Balance Sheet (Parenthetical) (Detail) | Dec. 31, 2016 |
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |
Unallocated LAE as a percentage of gross loss and LAE reserves | 1.30% |
Average Historical Loss and LAE
Average Historical Loss and LAE Duration, Net of Reinsurance (Detail) | Dec. 31, 2016 |
Reinsurance Segment | Property | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year One | 28.60% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Two | 37.20% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Three | 16.60% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Four | 7.80% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Five | 3.80% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Six | 1.90% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Seven | 1.40% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Eight | (0.10%) |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Nine | 0.20% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Ten | 0.00% |
Reinsurance Segment | Casualty & Other | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year One | 19.90% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Two | 17.30% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Three | 11.90% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Four | 10.00% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Five | 7.90% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Six | 6.80% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Seven | 5.50% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Eight | 4.10% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Nine | 3.50% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Ten | 2.00% |
Insurance Segment | RSUI | Property Insurance | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year One | 40.10% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Two | 31.30% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Three | 10.30% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Four | 6.10% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Five | 3.40% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Six | 0.60% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Seven | 0.90% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Eight | 1.00% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Nine | 0.20% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Ten | 0.20% |
Insurance Segment | RSUI | Casualty Insurance | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year One | 3.40% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Two | 13.50% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Three | 20.20% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Four | 13.90% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Five | 12.50% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Six | 8.30% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Seven | 3.30% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Eight | 3.40% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Nine | 3.40% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Ten | 0.70% |
Insurance Segment | CapSpecialty Incorporated | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year One | 25.90% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Two | 23.80% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Three | 16.20% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Four | 14.00% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Five | 9.20% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Six | 5.10% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Seven | 2.00% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Eight | 1.20% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Nine | 1.20% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Ten | 0.10% |
Insurance Segment | Pacific Comp | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year One | 16.50% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Two | 19.80% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Three | 16.80% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Four | 11.80% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Five | 7.50% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Six | 7.70% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Seven | 3.90% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Eight | 3.70% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Nine | 2.60% |
Average Annual Percentage Payout of Loss and LAE Incurred, Net of Reinsurance Year Ten | 1.80% |
Credit Agreements - Additional
Credit Agreements - Additional Information (Detail) - Alleghany Corporation - Revolving Credit Facility - USD ($) $ in Millions | Oct. 15, 2013 | Dec. 31, 2015 | Dec. 31, 2016 |
Line of Credit Facility [Line Items] | |||
Revolving credit facility, initiation date | Oct. 15, 2013 | ||
Line of credit facility, term | 4 years | ||
Revolving credit facility, maximum borrowing capacity | $ 200 | ||
Revolving credit facility expiration date | Oct. 15, 2017 | ||
Borrowings under Credit Agreement | $ 60 | ||
Repayment under Credit Agreement | $ 60 | ||
Credit facility borrowings outstanding | $ 0 | ||
Minimum | |||
Line of Credit Facility [Line Items] | |||
Borrowing under line of credit, commitment fee percentage | 0.125% | ||
Maximum | |||
Line of Credit Facility [Line Items] | |||
Borrowing under line of credit, commitment fee percentage | 0.30% |
Debt - Additional Information (
Debt - Additional Information (Detail) - USD ($) $ in Thousands | Dec. 14, 2015 | Oct. 15, 2014 | Sep. 09, 2014 | Jun. 26, 2012 | Sep. 10, 2010 | Nov. 23, 2009 | Dec. 31, 2016 | Dec. 31, 2014 | Dec. 31, 2015 | Dec. 14, 2005 |
Debt Instrument [Line Items] | ||||||||||
Senior Notes and other debt | $ 1,476,489 | $ 1,419,363 | ||||||||
Other activities | Alleghany Capital Corporation | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior Notes and other debt | $ 92,800 | $ 36,300 | ||||||||
Alleghany Corporation | 2044 Senior Notes | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior notes, face value | $ 300,000 | |||||||||
Senior notes, maturity date | Sep. 15, 2044 | |||||||||
Senior notes, frequency of interest payment | Interest on the 2044 Senior Notes is payable semi-annually on March 15 and September 15 of each year. | |||||||||
Senior notes, interest rate | 4.90% | |||||||||
Senior notes, issuance rate | 99.30% | |||||||||
Proceeds from issuance of Senior notes | $ 294,300 | |||||||||
Senior notes, effective yield | 5.00% | |||||||||
Alleghany Corporation | 2022 Senior Notes | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior notes, face value | $ 400,000 | |||||||||
Senior notes, maturity date | Jun. 27, 2022 | |||||||||
Senior notes, frequency of interest payment | Interest on the 2022 Senior Notes is payable semi-annually on June 27 and December 27 of each year. | |||||||||
Senior notes, interest rate | 4.95% | |||||||||
Senior notes, issuance rate | 99.90% | |||||||||
Proceeds from issuance of Senior notes | $ 396,000 | |||||||||
Senior notes, effective yield | 5.05% | |||||||||
Alleghany Corporation | 2020 Senior Notes | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior notes, face value | $ 300,000 | |||||||||
Senior notes, maturity date | Sep. 15, 2020 | |||||||||
Senior notes, frequency of interest payment | Interest on the 2020 Senior Notes is payable semi-annually on March 15 and September 15 of each year. | |||||||||
Senior notes, interest rate | 5.625% | |||||||||
Senior notes, issuance rate | 99.60% | |||||||||
Proceeds from issuance of Senior notes | $ 298,900 | |||||||||
Senior notes, effective yield | 5.67% | |||||||||
Transatlantic Holdings Incorporated | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Capital contribution from parent | $ 297,300 | |||||||||
Transatlantic Holdings Incorporated | 2015 Notes | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior notes, face value | $ 750,000 | |||||||||
Senior notes, maturity date | Dec. 14, 2015 | |||||||||
Senior notes, interest rate | 5.75% | |||||||||
Senior notes, matured amount | $ 367,000 | |||||||||
Senior notes, face value repurchased | 300,000 | $ 300,000 | ||||||||
Total cost of senior notes repurchased | 324,400 | |||||||||
Senior notes, redemption premium | 18,600 | |||||||||
Senior notes, repurchased, accrued and unpaid interest | $ 5,800 | |||||||||
Loss on early extinguishment of debt | $ (9,400) | |||||||||
Transatlantic Holdings Incorporated | 2039 Notes | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior notes, face value | $ 350,000 | |||||||||
Senior notes, maturity date | Nov. 30, 2039 | |||||||||
Senior notes, frequency of interest payment | Semi-annually | |||||||||
Senior notes, interest rate | 8.00% | |||||||||
Kentucky Trailer | Other activities | Alleghany Capital Corporation | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior Notes and other debt | $ 41,000 | |||||||||
Jazwares, LLC | Other activities | Alleghany Capital Corporation | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior Notes and other debt | 31,200 | |||||||||
Bourn & Koch, Inc. | Other activities | Alleghany Capital Corporation | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior Notes and other debt | $ 20,600 |
Income Tax Expense (Benefit) (D
Income Tax Expense (Benefit) (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Reconciliation of Provision of Income Taxes [Line Items] | |||
Current | $ 77,700 | $ 146,400 | $ 238,500 |
Deferred | 109,400 | 48,800 | 13,300 |
Income taxes | 187,141 | 195,173 | 251,777 |
Federal | |||
Reconciliation of Provision of Income Taxes [Line Items] | |||
Current | 49,400 | 93,300 | 115,400 |
Deferred | 109,600 | 49,200 | 12,900 |
Income taxes | 159,000 | 142,500 | 128,300 |
State | |||
Reconciliation of Provision of Income Taxes [Line Items] | |||
Current | 4,900 | 3,100 | 4,900 |
Deferred | 300 | (400) | 400 |
Income taxes | 5,200 | 2,700 | 5,300 |
Foreign | |||
Reconciliation of Provision of Income Taxes [Line Items] | |||
Current | 23,400 | 50,000 | 118,200 |
Deferred | (500) | ||
Income taxes | $ 22,900 | $ 50,000 | $ 118,200 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Taxes [Line Items] | |||
Income (Loss) before Income Taxes, Domestic | $ 407,700,000 | $ 376,700,000 | $ 633,800,000 |
Income (Loss) before Income Taxes, Foreign | 240,100,000 | 380,700,000 | 298,100,000 |
Income tax expense | 187,141,000 | 195,173,000 | $ 251,777,000 |
State net operating loss carry forward | 25,200,000 | 17,900,000 | |
Valuation allowance | 25,200,000 | $ 17,900,000 | |
Annual limitation on the use of foreign tax credit carryforwards and minimum tax credit carryforwards by Transatlantic | 42,700,000 | ||
Interest or penalties accrued for uncertain tax positions | 0 | ||
Prior Period Adjustments | |||
Income Taxes [Line Items] | |||
Income tax expense | $ 16,100,000 |
Difference between Federal Inco
Difference between Federal Income Tax Rate and Effective Income Tax Rate (Detail) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Reconciliation of Statutory Federal Tax Rate [Line Items] | |||
Federal income tax rate | 35.00% | 35.00% | 35.00% |
Foreign tax credits | (0.60%) | (0.40%) | |
Income subject to dividends-received deduction | (1.60%) | (1.60%) | (1.30%) |
Tax-exempt interest | (6.50%) | (6.80%) | (6.50%) |
State taxes, net of federal tax benefit | 0.60% | 0.20% | 0.40% |
Prior period adjustment | 2.40% | (0.20%) | 0.10% |
Other, net | (0.40%) | (0.40%) | (0.70%) |
Effective tax rate | 28.90% | 25.80% | 27.00% |
Tax Effects of Temporary Differ
Tax Effects of Temporary Differences that Give Rise to Significant Portions of Deferred Tax Assets and Deferred Tax Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Loss and LAE reserves | $ 212,100 | $ 242,700 |
Minimum tax credit carry forward | 28,900 | 110,200 |
Compensation accruals | 166,700 | 161,900 |
Unearned premiums | 139,100 | 134,000 |
OTTI losses | 19,500 | 21,900 |
State net operating loss carry forward | 25,200 | 17,900 |
Other | 173,300 | 167,200 |
Gross deferred tax assets before valuation allowance | 764,800 | 855,800 |
Valuation allowance | (25,200) | (17,900) |
Gross deferred tax assets | 739,600 | 837,900 |
Deferred tax liabilities: | ||
Net unrealized gains on investments | 125,800 | 120,800 |
Deferred acquisition costs | 163,300 | 146,800 |
Purchase accounting adjustments | 30,200 | 43,800 |
Other | 65,400 | 58,100 |
Gross deferred tax liabilities | 384,700 | 369,500 |
Net deferred tax assets | $ 354,852 | $ 468,440 |
Tax Year Returns that Remain Su
Tax Year Returns that Remain Subject to Examination by Major Tax Jurisdiction (Detail) | 12 Months Ended |
Dec. 31, 2016 | |
Australia | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,012 |
Australia | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,015 |
Canada | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,012 |
Canada | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,015 |
France | Earliest Tax Year | Period 1 | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,009 |
France | Earliest Tax Year | Period 2 | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,013 |
France | Latest Tax Year | Period 1 | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,010 |
France | Latest Tax Year | Period 2 | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,015 |
GERMANY | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,013 |
GERMANY | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,015 |
HONG KONG | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,014 |
HONG KONG | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,015 |
Japan | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,010 |
Japan | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,015 |
SINGAPORE | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,014 |
SINGAPORE | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,016 |
SWITZERLAND | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,015 |
U.K. | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,014 |
U.K. | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,015 |
U.S. | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,007 |
U.S. | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Open Tax Years | 2,015 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2016 | Dec. 31, 2015 | Nov. 30, 2015 | Dec. 31, 2014 | Jul. 31, 2014 | Dec. 31, 2013 | Oct. 31, 2012 | |
Stockholders Equity Note [Line Items] | |||||||
Amount of equity unavailable for dividends or advances from subsidiaries | $ 6,600,000 | ||||||
Stockholders' equity attributable to Alleghany stockholders | 7,939,945 | $ 7,554,707 | $ 7,473,428 | $ 6,923,757 | |||
Amount available for dividends or advances, parent level | 1,300,000 | ||||||
Operating Segments | |||||||
Stockholders Equity Note [Line Items] | |||||||
Statutory net income of insurance operating units | 688,900 | 741,000 | |||||
Combined statutory capital and surplus of insurance operating unit | 6,700,000 | $ 6,600,000 | |||||
Transatlantic Reinsurance Company | Maximum | |||||||
Stockholders Equity Note [Line Items] | |||||||
Amount of dividend that can be declared without regulatory approval | 15,000 | ||||||
2012 Repurchase Program | |||||||
Stockholders Equity Note [Line Items] | |||||||
Aggregate amount of common stock authorized for repurchase | $ 300,000 | ||||||
2014 Repurchase Program | |||||||
Stockholders Equity Note [Line Items] | |||||||
Aggregate amount of common stock authorized for repurchase | $ 350,000 | ||||||
2015 Repurchase Program | |||||||
Stockholders Equity Note [Line Items] | |||||||
Aggregate amount of common stock authorized for repurchase | $ 400,000 | ||||||
Stock repurchase program, remaining share authorized for repurchase | $ 379,200 |
Schedule of Common Stock Repurc
Schedule of Common Stock Repurchases (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Schedule Of Common Share Purchase [Line Items] | |||
Shares repurchased | 142,186 | 520,466 | 732,391 |
Cost of shares repurchased (in millions) | $ 68,320 | $ 243,814 | $ 300,478 |
Average price per share repurchased | $ 480.49 | $ 468.45 | $ 410.27 |
Reconciliation of Accumulated O
Reconciliation of Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | $ 7,554,707 | $ 7,473,428 |
Other comprehensive income (loss), net of tax: | ||
Reclassifications from accumulated other comprehensive income | (67,400) | (68,700) |
Ending Balance | 7,939,945 | 7,554,707 |
Unrealized Appreciation of Investments | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | 231,900 | 455,400 |
Other comprehensive income (loss), net of tax: | ||
Other comprehensive income (loss) before reclassifications | 67,700 | (154,800) |
Reclassifications from accumulated other comprehensive income | (67,400) | (68,700) |
Total | 300 | (223,500) |
Ending Balance | 232,200 | 231,900 |
Unrealized Currency Translation Adjustment | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | (104,000) | (89,200) |
Other comprehensive income (loss), net of tax: | ||
Other comprehensive income (loss) before reclassifications | (7,200) | (14,800) |
Total | (7,200) | (14,800) |
Ending Balance | (111,200) | (104,000) |
Retirement Plans | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | (11,600) | (12,600) |
Other comprehensive income (loss), net of tax: | ||
Other comprehensive income (loss) before reclassifications | (100) | 1,000 |
Total | (100) | 1,000 |
Ending Balance | (11,700) | (11,600) |
Accumulated Other Comprehensive Income (Loss) | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | 116,273 | 353,584 |
Other comprehensive income (loss), net of tax: | ||
Other comprehensive income (loss) before reclassifications | 60,400 | (168,600) |
Reclassifications from accumulated other comprehensive income | (67,400) | (68,700) |
Total | (7,000) | (237,300) |
Ending Balance | $ 109,284 | $ 116,273 |
Reclassifications of Accumulate
Reclassifications of Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Net realized capital gains | $ (63,205) | $ (213,897) | $ (247,058) | |
Other than temporary impairment losses | 45,165 | 133,868 | 36,294 | |
Income taxes | 187,141 | 195,173 | $ 251,777 | |
Total reclassifications | (67,400) | (68,700) | ||
Unrealized Appreciation of Investments | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Total reclassifications | (67,400) | (68,700) | ||
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 | [1] | (148,800) | (239,700) | |
Other than temporary impairment losses | 45,200 | 133,900 | ||
Income taxes | $ 36,200 | $ 37,100 | ||
[1] | For 2016, excludes a ($98.8) million impairment charge from a write-down of certain SORC assets and the Jazwares Remeasurement Gain of $13.2 million. For 2015, excludes a ($25.8) million realized capital loss related to an impairment charge related to a write-off of Alleghany's investment in ORX. |
Reclassifications of Accumula86
Reclassifications of Accumulated Other Comprehensive Income (Parenthetical) (Detail) - USD ($) $ in Thousands | Apr. 15, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Realized capital gains (losses) | $ 63,205 | $ 213,897 | $ 247,058 | |
Jazwares, LLC | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Gain on acquisition | $ 13,200 | 13,200 | ||
Stranded Oil Resources Corporation | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Realized capital gains (losses) | $ (98,800) | |||
ORX | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Realized capital gains (losses) | $ (25,800) |
Summary of Dividends Paid to Al
Summary of Dividends Paid to Alleghany by Operating Subsidiaries (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
TransRe | ||||
Dividends Payable [Line Items] | ||||
Dividends paid | [1] | $ 375 | $ 250 | $ 300 |
RSUI | ||||
Dividends Payable [Line Items] | ||||
Dividends paid | 100 | 150 | 225 | |
Transatlantic Holdings Incorporated And Rsui Group Incorporated | ||||
Dividends Payable [Line Items] | ||||
Dividends paid | $ 475 | $ 400 | $ 525 | |
[1] | In 2016, 2015 and 2014, TRC paid dividends of $350.0 million, $400.0 million and $400.0 million, respectively, to the TransRe holding company. |
Summary of Dividends Paid to 88
Summary of Dividends Paid to Alleghany by Operating Subsidiaries (Parenthetical) (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Transatlantic Reinsurance Company | |||
Dividends Payable [Line Items] | |||
Dividends paid | $ 350 | $ 400 | $ 400 |
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 | 12 Months Ended | |||||||||||||||||
Dec. 31, 2016 | [1] | Sep. 30, 2016 | [1] | Jun. 30, 2016 | [1] | Mar. 31, 2016 | [1] | Dec. 31, 2015 | [1] | Sep. 30, 2015 | [1] | Jun. 30, 2015 | [1] | Mar. 31, 2015 | [1] | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Earnings Per Share Disclosure [Line Items] | |||||||||||||||||||
Net earnings available to Alleghany stockholders | $ 69,500 | $ 155,800 | $ 77,100 | $ 154,500 | $ 156,100 | $ 96,500 | $ 182,500 | $ 125,200 | $ 456,921 | $ 560,315 | $ 679,239 | ||||||||
Adjustment related to redeemable noncontrolling interests | (2,600) | ||||||||||||||||||
Income available to common stockholders for basic earnings per share | 456,900 | 557,700 | 679,200 | ||||||||||||||||
Effect of dilutive securities | 100 | ||||||||||||||||||
Income available to common stockholders for diluted earnings per share | $ 456,900 | $ 557,800 | $ 679,200 | ||||||||||||||||
Weighted average common shares outstanding applicable to basic earnings per share | 15,436,286 | 15,871,055 | 16,405,388 | ||||||||||||||||
Effect of dilutive securities | 6,363 | 8,046 | |||||||||||||||||
Adjusted weighted average common shares outstanding applicable to diluted earnings per share | 15,442,649 | 15,879,101 | 16,405,388 | ||||||||||||||||
[1] | Attributable to Alleghany stockholders. |
Earnings Per Share of Common 90
Earnings Per Share of Common Stock - Additional Information (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Earnings Per Share [Line Items] | |||
Shares excluded in diluted earnings per share computation | 68,429 | 77,441 | 72,528 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Commitments and Contingencies Disclosure [Line Items] | ||||
Rent expense | $ 37,500 | $ 34,000 | $ 33,800 | |
Investments, debt securities | 12,983,213 | 13,605,963 | ||
Investments, equity securities | 3,109,523 | 3,005,908 | ||
Stockholders' equity | $ 7,939,945 | $ 7,554,707 | $ 7,473,428 | $ 6,923,757 |
Maximum | ||||
Commitments and Contingencies Disclosure [Line Items] | ||||
Non-cancelable operating leases, expiration date | 2,031 | |||
Energy Sector Business | ||||
Commitments and Contingencies Disclosure [Line Items] | ||||
Investments and equity in consolidated subsidiaries | $ 871,100 | |||
Investments, debt securities | 313,300 | |||
Investments, equity securities | 408,600 | |||
Energy Sector Business | Stranded Oil Resources Corporation | ||||
Commitments and Contingencies Disclosure [Line Items] | ||||
Stockholders' equity | $ 149,200 |
Aggregate Minimum Payments unde
Aggregate Minimum Payments under Operating Leases with Initial or Remaining Terms of More Than One Year (Detail) $ in Millions | Dec. 31, 2016USD ($) |
Schedule of Operating Leases [Line Items] | |
2,017 | $ 37.2 |
2,018 | 35 |
2,019 | 31.3 |
2,020 | 27.6 |
2,021 | 25 |
2022 and thereafter | $ 119.3 |
Asbestos Related Illnesses and
Asbestos Related Illnesses and Environmental Impairment Loss and Loss Adjustment Expense Reserves (Detail) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Commitments and Contingencies [Line Items] | ||
Gross asbestos-related illness and environmental impairment reserves | $ 172 | $ 183.6 |
Net asbestos-related illness and environmental impairment reserves | 166.3 | 177 |
Reinsurance Segment | ||
Commitments and Contingencies [Line Items] | ||
Gross asbestos-related illness and environmental impairment reserves | 165.7 | 174.9 |
Net asbestos-related illness and environmental impairment reserves | 160 | 168.4 |
Insurance Segment | CapSpecialty Incorporated | ||
Commitments and Contingencies [Line Items] | ||
Gross asbestos-related illness and environmental impairment reserves | 6.3 | 8.7 |
Net asbestos-related illness and environmental impairment reserves | $ 6.3 | $ 8.6 |
Segments of Business - Addition
Segments of Business - Additional Information (Detail) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016USD ($)Segment | Dec. 31, 2015USD ($)Segment | Dec. 31, 2014USD ($)Segment | Dec. 31, 2013USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of reportable segments | Segment | 2 | 2 | 2 | |
Gross premiums written | $ 5,767,100 | $ 5,122,200 | $ 5,096,600 | |
Net premiums earned | 4,975,777 | 4,230,286 | 4,410,647 | |
Identifiable assets | 23,756,591 | 22,839,079 | ||
Stockholders' equity attributable to Alleghany stockholders | $ 7,939,945 | $ 7,554,707 | $ 7,473,428 | $ 6,923,757 |
ORX | ||||
Segment Reporting Information [Line Items] | ||||
Disposal date | Dec. 23, 2016 | |||
Reinsurance Segment | Gross Premiums Written | Largest Broker Concentration Risk | ||||
Segment Reporting Information [Line Items] | ||||
Percentage of gross premiums written | 25.00% | 26.00% | 29.00% | |
Reinsurance Segment | Gross Premiums Written | Second Largest Broker Concentration Risk | ||||
Segment Reporting Information [Line Items] | ||||
Percentage of gross premiums written | 20.00% | 20.00% | 22.00% | |
Reinsurance Segment | Gross Premiums Written | Third Largest Broker Concentration Risk | ||||
Segment Reporting Information [Line Items] | ||||
Percentage of gross premiums written | 16.00% | 10.00% | 11.00% | |
Reinsurance Segment | Gross Premiums Written | Large Whole Account Quota Share Treaty | ||||
Segment Reporting Information [Line Items] | ||||
Percentage of gross premiums written | 20.00% | 6.00% | ||
Reinsurance Segment | Non-US | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | $ 1,500,000 | $ 1,600,000 | $ 1,700,000 | |
Net premiums earned | 1,400,000 | 1,400,000 | 1,500,000 | |
Reinsurance Segment | U.K. | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 622,300 | 640,400 | 654,800 | |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | 5,793,000 | 5,150,200 | 5,125,400 | |
Net premiums earned | 4,975,800 | 4,230,300 | 4,410,600 | |
Operating Segments | Reinsurance Segment | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | 4,330,300 | 3,662,100 | 3,600,100 | |
Net premiums earned | 3,845,000 | 3,115,500 | 3,330,700 | |
Identifiable assets | 15,700,000 | |||
Cash and invested assets | 13,100,000 | |||
Stockholders' equity attributable to Alleghany stockholders | 5,200,000 | |||
Operating Segments | Insurance Segment | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | 1,462,700 | 1,488,100 | 1,525,300 | |
Net premiums earned | 1,130,800 | $ 1,114,800 | $ 1,079,900 | |
Identifiable assets | 6,700,000 | |||
Cash and invested assets | 5,100,000 | |||
Stockholders' equity attributable to Alleghany stockholders | 2,800,000 | |||
Other activities | ||||
Segment Reporting Information [Line Items] | ||||
Identifiable assets | 1,400,000 | |||
Cash and invested assets | 500,000 | |||
Stockholders' equity attributable to Alleghany stockholders | $ (100,000) |
Results for Reportable Segments
Results for Reportable Segments and Other Activities (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | $ 5,767,100 | $ 5,122,200 | $ 5,096,600 | |
Net premiums written | 5,091,800 | 4,489,200 | 4,497,500 | |
Net premiums earned | 4,975,777 | 4,230,286 | 4,410,647 | |
Net loss and LAE | 2,917,166 | 2,339,790 | 2,494,565 | |
Commissions, brokerage and other underwriting expenses | [1] | 1,657,251 | 1,423,889 | 1,421,306 |
Underwriting profit (loss) | [2] | 401,300 | 466,600 | 494,800 |
Net investment income | 438,455 | 438,817 | 459,876 | |
Net realized capital gains | 63,205 | 213,897 | 247,058 | |
Other than temporary impairment losses | (45,165) | (133,868) | (36,294) | |
Other revenue | 698,747 | 250,346 | 150,522 | |
Other operating expenses | 765,226 | 342,361 | 252,673 | |
Corporate administration | 42,960 | 46,503 | 47,054 | |
Amortization of intangible assets | 19,012 | (2,211) | (5,750) | |
Interest expense | 81,599 | 91,778 | 90,052 | |
Earnings (losses) before income taxes | 647,805 | 757,368 | 931,909 | |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | 5,793,000 | 5,150,200 | 5,125,400 | |
Net premiums written | 5,091,800 | 4,489,200 | 4,497,500 | |
Net premiums earned | 4,975,800 | 4,230,300 | 4,410,600 | |
Net loss and LAE | 2,917,200 | 2,339,800 | 2,494,500 | |
Commissions, brokerage and other underwriting expenses | [1] | 1,657,300 | 1,423,900 | 1,421,300 |
Underwriting profit (loss) | [2] | 401,300 | 466,600 | 494,800 |
Net investment income | 433,100 | 427,600 | 448,900 | |
Net realized capital gains | 159,900 | 242,600 | 230,000 | |
Other than temporary impairment losses | (45,200) | (125,500) | (36,300) | |
Other revenue | 4,400 | 6,500 | 4,000 | |
Other operating expenses | 80,600 | 80,400 | 85,700 | |
Corporate administration | 1,000 | 900 | 1,300 | |
Amortization of intangible assets | (3,100) | (5,300) | (6,100) | |
Interest expense | 27,200 | 38,300 | 46,800 | |
Earnings (losses) before income taxes | 847,800 | 903,500 | 1,013,700 | |
Operating Segments | Reinsurance Segment | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | 4,330,300 | 3,662,100 | 3,600,100 | |
Net premiums written | 3,969,400 | 3,387,300 | 3,410,100 | |
Net premiums earned | 3,845,000 | 3,115,500 | 3,330,700 | |
Net loss and LAE | 2,285,400 | 1,718,700 | 1,909,200 | |
Commissions, brokerage and other underwriting expenses | [1] | 1,299,000 | 1,069,800 | 1,076,500 |
Underwriting profit (loss) | [2] | 260,600 | 327,000 | 345,000 |
Operating Segments | Reinsurance Segment | Property | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | 1,515,500 | 1,171,900 | 1,205,400 | |
Net premiums written | 1,237,200 | 953,600 | 1,073,400 | |
Net premiums earned | 1,168,000 | 887,400 | 1,048,600 | |
Net loss and LAE | 578,400 | 292,100 | 423,200 | |
Commissions, brokerage and other underwriting expenses | [1] | 376,200 | 295,600 | 319,300 |
Underwriting profit (loss) | [2] | 213,400 | 299,700 | 306,100 |
Operating Segments | Reinsurance Segment | Casualty & Other | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | [3] | 2,814,800 | 2,490,200 | 2,394,700 |
Net premiums written | [3] | 2,732,200 | 2,433,700 | 2,336,700 |
Net premiums earned | [3] | 2,677,000 | 2,228,100 | 2,282,100 |
Net loss and LAE | [3] | 1,707,000 | 1,426,600 | 1,486,000 |
Commissions, brokerage and other underwriting expenses | [1],[3] | 922,800 | 774,200 | 757,200 |
Underwriting profit (loss) | [2],[3] | 47,200 | 27,300 | 38,900 |
Operating Segments | Insurance Segment | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | 1,462,700 | 1,488,100 | 1,525,300 | |
Net premiums written | 1,122,400 | 1,101,900 | 1,087,400 | |
Net premiums earned | 1,130,800 | 1,114,800 | 1,079,900 | |
Net loss and LAE | 631,800 | 621,100 | 585,300 | |
Commissions, brokerage and other underwriting expenses | [1] | 358,300 | 354,100 | 344,800 |
Underwriting profit (loss) | [2] | 140,700 | 139,600 | 149,800 |
Operating Segments | Insurance Segment | RSUI | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | 1,056,400 | 1,148,400 | 1,242,100 | |
Net premiums written | 734,100 | 779,400 | 825,500 | |
Net premiums earned | 754,500 | 809,800 | 828,200 | |
Net loss and LAE | 403,800 | 428,800 | 427,300 | |
Commissions, brokerage and other underwriting expenses | [1] | 212,300 | 222,900 | 220,800 |
Underwriting profit (loss) | [2] | 138,400 | 158,100 | 180,100 |
Operating Segments | Insurance Segment | CapSpecialty Incorporated | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | 266,500 | 236,600 | 212,700 | |
Net premiums written | 250,000 | 220,600 | 192,400 | |
Net premiums earned | 237,500 | 205,000 | 184,400 | |
Net loss and LAE | 125,300 | 115,700 | 103,000 | |
Commissions, brokerage and other underwriting expenses | [1] | 107,300 | 94,300 | 92,000 |
Underwriting profit (loss) | [2] | 4,900 | (5,000) | (10,600) |
Operating Segments | Insurance Segment | Pacific Comp | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | 139,800 | 103,100 | 70,500 | |
Net premiums written | 138,300 | 101,900 | 69,500 | |
Net premiums earned | 138,800 | 100,000 | 67,300 | |
Net loss and LAE | 102,700 | 76,600 | 55,000 | |
Commissions, brokerage and other underwriting expenses | [1] | 38,700 | 36,900 | 32,000 |
Underwriting profit (loss) | [2] | (2,600) | (13,500) | (19,700) |
Other activities | Alleghany Capital Corporation | ||||
Segment Reporting Information [Line Items] | ||||
Net investment income | (2,300) | 5,400 | 2,800 | |
Net realized capital gains | (86,000) | (25,600) | 2,800 | |
Other revenue | 687,100 | 241,000 | 145,600 | |
Other operating expenses | 680,500 | 259,300 | 164,500 | |
Amortization of intangible assets | 22,100 | 3,100 | 400 | |
Interest expense | 1,900 | 1,500 | 900 | |
Earnings (losses) before income taxes | (105,700) | (43,100) | (14,600) | |
Other activities | Corporate activities | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | [4] | (25,900) | (28,000) | (28,800) |
Net investment income | [4] | 7,700 | 5,800 | 8,200 |
Net realized capital gains | [4] | (10,700) | (3,100) | 14,300 |
Other than temporary impairment losses | [4] | (8,400) | ||
Other revenue | [4] | 7,300 | 2,900 | 900 |
Other operating expenses | [4] | 4,100 | 2,600 | 2,500 |
Corporate administration | [4] | 42,000 | 45,600 | 45,800 |
Interest expense | [4] | 52,500 | 52,000 | 42,300 |
Earnings (losses) before income taxes | [4] | $ (94,300) | $ (103,000) | $ (67,200) |
[1] | Includes amortization associated with deferred acquisition costs of $1,253.2 million, $1,024.5 million and $1,042.0 million for the years ended December 31, 2016, 2015 and 2014, respectively. | |||
[2] | Underwriting profit represents net premiums earned less net loss and LAE and commissions, brokerage and other underwriting expenses, all as determined in accordance with GAAP, and does not include net investment income, net realized capital gains, OTTI losses, other revenue, other operating expenses, corporate administration, amortization of intangible assets or interest expense. Underwriting profit does not replace earnings before income taxes determined in accordance with GAAP as a measure of profitability. Rather, Alleghany believes that underwriting profit enhances the understanding of its segments' operating results by highlighting net earnings attributable to their underwriting performance. Earnings before income taxes (a GAAP measure) may show a profit despite an underlying underwriting loss. Where underwriting losses persist over extended periods, a reinsurance or an insurance company's ability to continue as an ongoing concern may be at risk. Therefore, Alleghany views underwriting profit as an important measure in the overall evaluation of performance. | |||
[3] | Primarily consists of the following assumed reinsurance lines of business: directors' and officers' liability; errors and omissions liability; general liability; medical malpractice; ocean marine and aviation; auto liability; accident and health; surety; and credit. | |||
[4] | Includes elimination of minor reinsurance activity between segments. |
Results for Reportable Segmen96
Results for Reportable Segments and Other Activities (Parenthetical) (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Segment Reporting Information [Line Items] | |||
Amortization associated with deferred acquisition costs | $ 1,253.2 | $ 1,024.5 | $ 1,042 |
Long-Term Compensation Plans -
Long-Term Compensation Plans - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Restricted Stock Units (RSUs) | RSUI | |||
Executive Compensation Plan Expense [Line Items] | |||
Compensation expense recognized | $ 25.4 | $ 22.7 | $ 28.2 |
Income tax benefit related to share based compensation expense | 8.9 | 7.9 | 9.9 |
Parent Company | |||
Executive Compensation Plan Expense [Line Items] | |||
Compensation expense recognized | 17.1 | 19.7 | 21.2 |
Income tax benefit related to share based compensation expense | 6 | 6.9 | 7.4 |
Fair value of common stocks issued to satisfy share based compensations | 5.7 | 4.7 | 4.5 |
Compensation costs paid in cash | $ 14.4 | 10.9 | 7.6 |
Parent Company | Performance Share Awards | |||
Executive Compensation Plan Expense [Line Items] | |||
Share based compensation arrangement by share based payment award expiration period | 4 years | ||
Reinsurance Segment | Book Value Unit Plan Bvu And Midterm Incentive Plan Grant | |||
Executive Compensation Plan Expense [Line Items] | |||
Compensation expense recognized | $ 50.7 | 54.9 | 55.3 |
Income tax benefit related to share based compensation expense | $ 17.7 | $ 19.2 | $ 19.4 |
Employee Retirement Benefit P98
Employee Retirement Benefit Plans - Additional Information (Detail) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Parent Company | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Projected benefit obligation | $ 30.2 | $ 28.2 |
Fair value of plan assets | 2.4 | 2.5 |
Transatlantic Holdings Incorporated | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Projected benefit obligation | 65.4 | 63 |
Fair value of plan assets | $ 48.7 | $ 46.7 |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||||||
Schedule Of Quarterly Financial Data [Line Items] | |||||||||||||||||||
Revenues | $ 1,455,300 | $ 1,614,600 | $ 1,582,100 | $ 1,478,900 | $ 1,352,400 | $ 1,189,100 | $ 1,300,500 | $ 1,157,600 | $ 6,131,019 | $ 4,999,478 | $ 5,231,809 | ||||||||
Net earnings | $ 69,500 | [1] | $ 155,800 | [1] | $ 77,100 | [1] | $ 154,500 | [1] | $ 156,100 | [1] | $ 96,500 | [1] | $ 182,500 | [1] | $ 125,200 | [1] | $ 456,921 | $ 560,315 | $ 679,239 |
Basic earnings per share of Common Stock | $ 4.51 | [1],[2] | $ 10.09 | [1],[2] | $ 4.99 | [1],[2] | $ 10 | [1],[2] | $ 9.86 | [1],[2] | $ 6.07 | [1],[2] | $ 11.41 | [1],[2] | $ 7.82 | [1],[2] | $ 29.60 | $ 35.14 | $ 41.40 |
[1] | Attributable to Alleghany stockholders. | ||||||||||||||||||
[2] | Earnings per share by quarter may not equal the amount for the full year due to the timing of repurchases of Common Stock, as well as rounding. |
Summary of Investments Other Th
Summary of Investments Other Than Investments in Related Parties (Detail) $ in Millions | Dec. 31, 2016USD ($) |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | $ 17,762.2 |
Fair Value | 18,111.2 |
Amount at which shown in Balance sheet | 18,111.2 |
U.S. Government obligations | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 1,265.7 |
Fair Value | 1,243.3 |
Amount at which shown in Balance sheet | 1,243.3 |
Municipal bonds | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 4,161 |
Fair Value | 4,185.8 |
Amount at which shown in Balance sheet | 4,185.8 |
Foreign Government Debt | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 1,030.9 |
Fair Value | 1,047.1 |
Amount at which shown in Balance sheet | 1,047.1 |
U.S. corporate bonds | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 2,168.9 |
Fair Value | 2,193.1 |
Amount at which shown in Balance sheet | 2,193.1 |
Foreign corporate bonds | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 1,068.3 |
Fair Value | 1,088.8 |
Amount at which shown in Balance sheet | 1,088.8 |
RMBS | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 1,005.9 |
Fair Value | 1,000.4 |
Amount at which shown in Balance sheet | 1,000.4 |
CMBS | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 728.8 |
Fair Value | 734.8 |
Amount at which shown in Balance sheet | 734.8 |
Other asset-backed securities | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 1,497.6 |
Fair Value | 1,489.9 |
Amount at which shown in Balance sheet | 1,489.9 |
Fixed Maturities | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 12,927.1 |
Fair Value | 12,983.2 |
Amount at which shown in Balance sheet | 12,983.2 |
Banks, trust and insurance companies | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 443.1 |
Fair Value | 523.9 |
Amount at which shown in Balance sheet | 523.9 |
Industrial, miscellaneous and all other | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 2,373.5 |
Fair Value | 2,585.6 |
Amount at which shown in Balance sheet | 2,585.6 |
Equity Securities | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 2,816.6 |
Fair Value | 3,109.5 |
Amount at which shown in Balance sheet | 3,109.5 |
Commercial mortgage loans | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 594.9 |
Fair Value | 594.9 |
Amount at which shown in Balance sheet | 594.9 |
Other invested assets | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 645.2 |
Fair Value | 645.2 |
Amount at which shown in Balance sheet | 645.2 |
Short-term Investments | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Cost | 778.4 |
Fair Value | 778.4 |
Amount at which shown in Balance sheet | $ 778.4 |
Condensed Balance Sheets (Detai
Condensed Balance Sheets (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Assets | ||||
Equity securities (cost: 2016 - $171,860; 2015 - $217,039) | $ 3,109,523 | $ 3,005,908 | ||
Debt securities (amortized cost: 2016 - $31,505; 2015 - $31,746) | 12,983,213 | 13,605,963 | ||
Short-term investments | 778,410 | 365,810 | ||
Other invested assets | 645,245 | 676,811 | ||
Cash | 594,091 | 475,267 | $ 605,259 | $ 498,315 |
Property and equipment at cost, net of accumulated depreciation and amortization | 112,920 | 101,306 | ||
Other assets | 522,922 | 633,964 | ||
Net deferred tax assets | 354,852 | 468,440 | ||
Total assets | 23,756,591 | 22,839,079 | ||
Liabilities, Redeemable Noncontrolling Interests and Stockholders' Equity | ||||
Senior notes | 1,476,489 | 1,419,363 | ||
Other liabilities | 912,081 | 894,690 | ||
Total liabilities | 15,741,926 | 15,258,653 | ||
Redeemable noncontrolling interest | 74,720 | 25,719 | 8,616 | 23,764 |
Stockholders' equity attributable to Alleghany stockholders | 7,939,945 | 7,554,707 | 7,473,428 | 6,923,757 |
Total liabilities, redeemable noncontrolling interest and stockholders' equity | 23,756,591 | 22,839,079 | ||
Parent Company | ||||
Assets | ||||
Equity securities (cost: 2016 - $171,860; 2015 - $217,039) | 187,413 | 216,776 | ||
Debt securities (amortized cost: 2016 - $31,505; 2015 - $31,746) | 31,564 | 30,483 | ||
Short-term investments | 235,510 | 83,135 | ||
Other invested assets | 36,741 | |||
Cash | 6,139 | 2,477 | $ 10,535 | $ 17,356 |
Property and equipment at cost, net of accumulated depreciation and amortization | 5,537 | 259 | ||
Other assets | 14,359 | 18,920 | ||
Net deferred tax assets | 39,503 | 45,775 | ||
Investment in subsidiaries | 8,611,000 | 8,325,073 | ||
Total assets | 9,167,766 | 8,722,898 | ||
Liabilities, Redeemable Noncontrolling Interests and Stockholders' Equity | ||||
Senior notes | 991,376 | 990,421 | ||
Other liabilities | 112,342 | 110,058 | ||
Current taxes payable | 49,383 | 41,993 | ||
Total liabilities | 1,153,101 | 1,142,472 | ||
Redeemable noncontrolling interest | 74,720 | 25,719 | ||
Stockholders' equity attributable to Alleghany stockholders | 7,939,945 | 7,554,707 | ||
Total liabilities, redeemable noncontrolling interest and stockholders' equity | $ 9,167,766 | $ 8,722,898 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parenthetical) (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Condensed Financial Statements, Captions [Line Items] | ||
Equity securities, cost | $ 2,816,572 | $ 2,740,984 |
Debt securities, amortized cost | 12,927,103 | 13,529,923 |
Parent Company | ||
Condensed Financial Statements, Captions [Line Items] | ||
Equity securities, cost | 171,860 | 217,039 |
Debt securities, amortized cost | $ 31,505 | $ 31,746 |
Condensed Statements of Earning
Condensed Statements of Earnings (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||||||
Revenues | |||||||||||||||||||
Net investment income | $ 438,455 | $ 438,817 | $ 459,876 | ||||||||||||||||
Net realized capital gains | 63,205 | 213,897 | 247,058 | ||||||||||||||||
Other than temporary impairment losses | (45,165) | (133,868) | (36,294) | ||||||||||||||||
Other revenue | 698,747 | 250,346 | 150,522 | ||||||||||||||||
Total revenues | $ 1,455,300 | $ 1,614,600 | $ 1,582,100 | $ 1,478,900 | $ 1,352,400 | $ 1,189,100 | $ 1,300,500 | $ 1,157,600 | 6,131,019 | 4,999,478 | 5,231,809 | ||||||||
Costs and Expenses | |||||||||||||||||||
Interest expense | 81,599 | 91,778 | 90,052 | ||||||||||||||||
Corporate administration | 42,960 | 46,503 | 47,054 | ||||||||||||||||
Total costs and expenses | 5,483,214 | 4,242,110 | 4,299,900 | ||||||||||||||||
Earnings (losses) before income taxes | 647,805 | 757,368 | 931,909 | ||||||||||||||||
Income taxes | 187,141 | 195,173 | 251,777 | ||||||||||||||||
Net earnings | 460,664 | 562,195 | 680,132 | ||||||||||||||||
Net earnings attributable to noncontrolling interest | 3,743 | 1,880 | 893 | ||||||||||||||||
Net earnings attributable to Alleghany stockholders | $ 69,500 | [1] | $ 155,800 | [1] | $ 77,100 | [1] | $ 154,500 | [1] | $ 156,100 | [1] | $ 96,500 | [1] | $ 182,500 | [1] | $ 125,200 | [1] | 456,921 | 560,315 | 679,239 |
Parent Company | |||||||||||||||||||
Revenues | |||||||||||||||||||
Net investment income | 7,688 | 5,800 | 8,169 | ||||||||||||||||
Net realized capital gains | (10,674) | (9,088) | 14,349 | ||||||||||||||||
Other than temporary impairment losses | (2,388) | ||||||||||||||||||
Other revenue | 159 | 218 | 265 | ||||||||||||||||
Total revenues | (2,827) | (5,458) | 22,783 | ||||||||||||||||
Costs and Expenses | |||||||||||||||||||
Interest expense | 52,470 | 52,056 | 42,310 | ||||||||||||||||
Corporate administration | 42,035 | 45,573 | 45,741 | ||||||||||||||||
Total costs and expenses | 94,505 | 97,629 | 88,051 | ||||||||||||||||
Operating (losses) | (97,332) | (103,087) | (65,268) | ||||||||||||||||
Equity in earnings of consolidated subsidiaries | 745,137 | 860,455 | 997,177 | ||||||||||||||||
Earnings (losses) before income taxes | 647,805 | 757,368 | 931,909 | ||||||||||||||||
Income taxes | 187,141 | 195,173 | 251,777 | ||||||||||||||||
Net earnings | 460,664 | 562,195 | 680,132 | ||||||||||||||||
Net earnings attributable to noncontrolling interest | 3,743 | 1,880 | 893 | ||||||||||||||||
Net earnings attributable to Alleghany stockholders | $ 456,921 | $ 560,315 | $ 679,239 | ||||||||||||||||
[1] | Attributable to Alleghany stockholders. |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities | |||
Net earnings | $ 460,664 | $ 562,195 | $ 680,132 |
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 160,469 | 163,062 | 178,949 |
Net realized capital (gains) losses | (63,205) | (213,897) | (247,058) |
Other than temporary impairment losses | 45,165 | 133,868 | 36,294 |
Net adjustments | 332,263 | (236,217) | (307,353) |
Net cash (used in) provided by operating activities | 792,927 | 325,978 | 372,779 |
Cash flows from investing activities | |||
Purchases of equity securities | (2,093,644) | (3,496,203) | (1,521,201) |
Sales of debt securities | 4,895,282 | 6,377,573 | 5,558,948 |
Maturities and redemptions of debt securities | 1,512,879 | 1,653,606 | 1,437,988 |
Sales of equity securities | 2,067,095 | 3,172,826 | 1,043,181 |
Net (purchase) sale in short-term investments | (442,784) | 326,765 | 624,209 |
Purchases of property and equipment | (24,005) | (27,258) | (43,681) |
Other, net | (29,861) | (26,820) | (257,090) |
Net cash provided by (used in) investing activities | (672,727) | 171,658 | 51,035 |
Cash flows from financing activities | |||
Proceeds from issuance of senior notes | 297,942 | ||
Debt issue costs paid | (3,625) | ||
Treasury stock acquisitions | (68,320) | (243,814) | (300,478) |
Other, net | 50,906 | 2,033 | 22,674 |
Net cash provided by (used in) financing activities | (17,414) | (608,783) | (302,075) |
Effect of exchange rate changes on cash | 16,038 | (18,845) | (14,795) |
Net (decrease) increase in cash | 118,824 | (129,992) | 106,944 |
Cash at beginning of period | 475,267 | 605,259 | 498,315 |
Cash at end of period | 594,091 | 475,267 | 605,259 |
Cash paid during the period for: | |||
Interest paid | 80,817 | 102,146 | 100,977 |
Income taxes paid (refunds received) | 83,023 | 59,699 | 335,050 |
Parent Company | |||
Cash flows from operating activities | |||
Net earnings | 460,664 | 562,195 | 680,132 |
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: | |||
Equity in undistributed net (earnings) losses of consolidated subsidiaries | (524,201) | (628,747) | (722,445) |
Depreciation and amortization | 2,035 | 1,949 | 1,845 |
Net realized capital (gains) losses | 10,674 | 9,088 | (14,349) |
Other than temporary impairment losses | 2,388 | ||
Increase (decrease) in other liabilities and taxes payable | 14,677 | 38,065 | 22,654 |
Net adjustments | (496,815) | (577,257) | (712,295) |
Net cash (used in) provided by operating activities | (36,151) | (15,062) | (32,163) |
Cash flows from investing activities | |||
Purchases of equity securities | (132,129) | (440,143) | (226,418) |
Sales of debt securities | 39,548 | ||
Maturities and redemptions of debt securities | 73 | 89 | 121 |
Sales of equity securities | 166,634 | 256,502 | 216,951 |
Net (purchase) sale in short-term investments | (152,375) | 69,808 | (74,842) |
Purchases of property and equipment | (5,779) | (4) | (158) |
Other, net | (37,600) | 259 | 383 |
Net cash provided by (used in) investing activities | (161,176) | (73,941) | (83,963) |
Cash flows from financing activities | |||
Proceeds from issuance of senior notes | 297,942 | ||
Debt issue costs paid | (3,625) | ||
Treasury stock acquisitions | (68,320) | (243,814) | (300,478) |
Capital contributions to consolidated subsidiaries | (163,732) | (175,635) | (453,551) |
Distributions from consolidated subsidiaries | 434,900 | 497,283 | 566,723 |
Other, net | (1,859) | 3,111 | 2,294 |
Net cash provided by (used in) financing activities | 200,989 | 80,945 | 109,305 |
Effect of exchange rate changes on cash | 0 | 0 | 0 |
Net (decrease) increase in cash | 3,662 | (8,058) | (6,821) |
Cash at beginning of period | 2,477 | 10,535 | 17,356 |
Cash at end of period | 6,139 | 2,477 | 10,535 |
Cash paid during the period for: | |||
Interest paid | 51,375 | 51,620 | 36,675 |
Income taxes paid (refunds received) | $ 37,220 | $ (8,523) | $ 221,309 |
Supplemental Insurance Infor105
Supplemental Insurance Information (Detail) - Property and Casualty Insurance - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Supplementary Insurance Information, by Segment [Line Items] | |||
Deferred Policy Acquisition Costs | $ 448.6 | $ 419.4 | $ 353.2 |
Future Policy Benefits, Losses, Claims and Loss Expenses | 11,087.2 | 10,779.2 | 11,597.2 |
Unearned Premiums | 2,175.5 | 2,076.1 | 1,834.2 |
Other Policy Claims and Benefits Payable | 0 | 0 | 0 |
Premium Revenue | 4,975.8 | 4,230.3 | 4,410.6 |
Net Investment Income | 433.1 | 427.6 | 448.9 |
Benefits, Claims, Losses and Settlement Expenses | 2,917.2 | 2,339.8 | 2,494.5 |
Amortization of Deferred Policy Acquisition Costs | 1,253.2 | 1,024.5 | 1,042 |
Other Operating Expenses | 404.1 | 399.4 | 379.3 |
Premiums Written | $ 5,091.8 | $ 4,489.2 | $ 4,497.5 |
Reinsurance (Detail)
Reinsurance (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | |||
Net Amount | $ 4,975,777 | $ 4,230,286 | $ 4,410,647 |
Property and Casualty Insurance | |||
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | |||
Gross Amount | 1,871,100 | 1,515,900 | 1,517,000 |
Ceded to Other Companies | 729,200 | 688,900 | 646,900 |
Assumed from Other Companies | 3,833,900 | 3,403,300 | 3,540,500 |
Net Amount | $ 4,975,800 | $ 4,230,300 | $ 4,410,600 |
Percentage of Amount Assumed to Net | 77.10% | 80.50% | 80.30% |
Valuation and Qualifying Acc107
Valuation and Qualifying Accounts (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Allowance for uncollectible reinsurance recoverables | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Charged to Other Accounts | $ 0 | $ 0 | $ 0 |
Allowance for Uncollectible Premiums Receivable | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Beginning Balance | 0.8 | 0.4 | 0.5 |
Charged to Costs and Expenses | 1.2 | 1.1 | 0.6 |
Charged to Other Accounts | 0 | 0 | 0 |
Deductions | 1 | 0.7 | 0.7 |
Ending Balance | $ 1 | $ 0.8 | $ 0.4 |
Supplemental Information Con108
Supplemental Information Concerning Insurance Operations (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Supplemental Information for Property, Casualty Insurance Underwriters [Line Items] | |||
Deferred Policy Acquisition Costs | $ 448.6 | $ 419.4 | $ 353.2 |
Reserves for Unpaid Claims and Claim Adjustment Expenses | 11,087.2 | 10,779.2 | 11,597.2 |
Discount if Any Deducted, in Reserves for Unpaid Claims and Claim Adjustment Expenses | 0 | 0 | 0 |
Unearned Premiums | 2,175.5 | 2,076.1 | 1,834.2 |
Earned Premiums | 4,975.8 | 4,230.3 | 4,410.6 |
Net Investment Income | 433.1 | 427.6 | 448.9 |
Claims and Claim Adjustment Expense Incurred Related to Current Year | 3,285.2 | 2,555.3 | 2,709.7 |
Claims and Claim Adjustment Expense Incurred Related to Prior Year | (368) | (215.5) | (215.2) |
Amortization of Deferred Policy Acquisition Costs | 1,253.2 | 1,024.5 | 1,042 |
Paid Claims and Claim Adjustment Expenses | 2,600.8 | 2,808 | 2,698.9 |
Premiums Written | $ 5,091.8 | $ 4,489.2 | $ 4,497.5 |