Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2021 | Feb. 21, 2022 | Jun. 30, 2021 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Amendment Flag | false | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2021 | ||
Entity File Number | 001-16209 | ||
Entity Registrant Name | ARCH CAPITAL GROUP LTD. | ||
Entity Incorporation, State or Country Code | D0 | ||
Entity Tax Identification Number | 98-0374481 | ||
Entity Address, Address Line One | Waterloo House, Ground Floor | ||
Entity Address, Address Line Two | 100 Pitts Bay Road, | ||
Entity Address, City or Town | Pembroke | ||
Entity Address, Postal Zip Code | HM 08, | ||
Entity Address, Country | BM | ||
City Area Code | (441) | ||
Local Phone Number | 278-9250 | ||
Entity Listings [Line Items] | |||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 14.3 | ||
Entity Common Stock, Shares Outstanding | 379,042,099 | ||
Documents Incorporated by Reference | Portions of Part III and Part IV incorporate by reference our definitive proxy statement for the 2022 annual meeting of shareholders to be filed with the Securities and Exchange Commission pursuant to Regulation 14A within 120 days after December 31, 2021. | ||
Entity Central Index Key | 0000947484 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Common shares | |||
Entity Listings [Line Items] | |||
Title of 12(b) Security | Common Shares, $0.0011 par value per share | ||
Trading Symbol | ACGL | ||
Security Exchange Name | NASDAQ | ||
Series F depositary share equivalent | |||
Entity Listings [Line Items] | |||
Title of 12(b) Security | Depositary shares, each representing a 1/1,000th interest in a 5.45% Series F preferred share | ||
Trading Symbol | ACGLO | ||
Security Exchange Name | NASDAQ | ||
Series G depositary share equivalent | |||
Entity Listings [Line Items] | |||
Title of 12(b) Security | Depositary shares, each representing a 1/1,000th interest in a 4.55% Series G preferred share | ||
Trading Symbol | ACGLN | ||
Security Exchange Name | NASDAQ |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2021 | |
Audit Information [Abstract] | |
Auditor Name | PricewaterhouseCoopers LLP |
Auditor Location | New York, New York |
Auditor Firm ID | 238 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Investments: | ||
Fixed maturities available for sale, at fair value (amortized cost: $17,973,823 and $18,143,305; net of allowance for credit losses: $2,883 and $2,397) | $ 17,998,109 | $ 18,717,825 |
Short-term investments available for sale, at fair value (amortized cost: $1,734,738 and $1,924,292; net of allowance for credit losses: $0 and $0 ) | 1,734,716 | 1,924,922 |
Collateral received under securities lending, at fair value (amortized cost: $0 and $301,089) | 0 | 301,096 |
Equity securities, at fair value | 1,804,170 | 1,444,830 |
Other investments (portion measured at fair value: $1,973,550 and $3,824,796) | 1,973,550 | 4,324,796 |
Investments accounted for using the equity method | 3,077,611 | 2,047,889 |
Total investments | 26,588,156 | 28,761,358 |
Cash | 858,668 | 906,448 |
Accrued investment income | 85,453 | 103,299 |
Securities pledged under securities lending, at fair value (amortized cost: $0 and $294,493) | 0 | 294,912 |
Investment in operating affiliates | 1,135,655 | 129,291 |
Premiums receivable (net of allowance for credit losses: $39,958 and $37,781) | 2,633,280 | 2,064,586 |
Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses (net of allowance for credit losses: $13,230 and $11,636) | 5,880,735 | 4,500,802 |
Contractholder receivables (net of allowance for credit losses: $3,437 and $8,638) | 1,828,691 | 1,986,924 |
Ceded unearned premiums | 1,729,455 | 1,234,075 |
Deferred acquisition costs | 901,841 | 790,708 |
Receivable for securities sold | 60,179 | 92,743 |
Goodwill and intangible assets | 944,983 | 692,863 |
Other assets | 2,453,849 | 1,724,288 |
Total assets | 45,100,945 | 43,282,297 |
Liabilities | ||
Reserve for losses and loss adjustment expenses | 17,757,156 | 16,513,929 |
Unearned premiums | 6,011,942 | 4,838,965 |
Reinsurance balances payable | 1,583,253 | 683,263 |
Contractholder payables | 1,832,127 | 1,995,562 |
Collateral held for insured obligations | 242,352 | 215,581 |
Senior notes | 2,724,394 | 2,861,113 |
Revolving credit agreement borrowings | 0 | 155,687 |
Securities lending payable | 0 | 301,089 |
Payable for securities purchased | 64,850 | 218,779 |
Other liabilities | 1,329,742 | 1,510,888 |
Total liabilities | 31,545,816 | 29,294,856 |
Commitments and Contingencies | ||
Redeemable noncontrolling interests | 9,233 | 58,548 |
Shareholders’ Equity | ||
Non-cumulative preferred shares | 830,000 | 780,000 |
Common shares ($0.0011 par, shares issued: 583,289,850 and 579,000,841) | 648 | 643 |
Additional paid-in capital | 2,085,075 | 1,977,794 |
Retained earnings | 14,455,868 | 12,362,463 |
Accumulated other comprehensive income (loss), net of deferred income tax | (64,600) | 488,895 |
Common shares held in treasury, at cost (shares: 204,365,956 and 172,280,199) | (3,761,095) | (2,503,909) |
Total shareholders' equity available to Arch | 13,545,896 | 13,105,886 |
Non-redeemable noncontrolling interests | 0 | 823,007 |
Total shareholders' equity | 13,545,896 | 13,928,893 |
Total liabilities, noncontrolling interests and shareholders' equity | $ 45,100,945 | $ 43,282,297 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Fixed maturities available for sale, at amortized cost | $ 17,973,823 | $ 18,143,305 |
Short-term investments available for sale, at amortized cost | 1,734,738 | 1,924,292 |
Allowance for credit losses on investments | 2,883 | 2,397 |
Collateral received under securities lending agreements, at amortized cost | 0 | 301,089 |
Investments accounted for using the fair value option | 1,973,550 | 3,824,796 |
Securities pledged under securities lending, at amortized cost | 0 | 294,493 |
Allowance for credit losses on premiums receivable | 39,958 | 37,781 |
Allowance for credit losses on reinsurance recoverable | 13,230 | 11,636 |
Allowance for credit loss on contractholder receivable | $ 3,437 | $ 8,638 |
Common shares, par value per share | $ 0.0011 | $ 0.0011 |
Common shares issued (shares) | 583,289,850 | 579,000,841 |
Common shares held in treasury (shares) | 204,365,956 | 172,280,199 |
Short-term investments | ||
Short-term investments available for sale, at amortized cost | $ 1,734,738 | $ 1,924,292 |
Allowance for credit losses on investments | 0 | 0 |
Fixed maturities | ||
Allowance for credit losses on investments | $ 2,883 | $ 2,397 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues | |||
Net premiums earned | $ 8,082,298 | $ 6,991,935 | $ 5,786,498 |
Net investment income | 389,118 | 519,608 | 627,738 |
Net realized gains (losses) | 379,845 | 823,460 | 363,198 |
Other underwriting income | 22,073 | 26,784 | 24,861 |
Equity in net income of investments accounted for using the equity method | 366,402 | 146,693 | 123,672 |
Other income (loss) | 10,244 | 29 | 0 |
Total revenues | 9,249,980 | 8,508,509 | 6,925,967 |
Expenses | |||
Losses and loss adjustment expenses | 4,584,803 | 4,689,599 | 3,133,452 |
Acquisition expenses | 1,303,178 | 1,004,842 | 840,945 |
Other operating expenses | 998,595 | 875,176 | 800,997 |
Corporate expenses | 79,157 | 81,988 | 80,111 |
Amortization of intangible assets | 82,955 | 69,031 | 82,104 |
Interest expense | 139,470 | 143,456 | 120,872 |
Net foreign exchange losses (gains) | (41,529) | 83,634 | 20,609 |
Total expenses | 7,146,629 | 6,947,726 | 5,079,090 |
Income (loss) before income taxes and income (loss) from operating affiliates | 2,103,351 | 1,560,783 | 1,846,877 |
Income taxes: | |||
Current tax expense (benefit) | 295,533 | 197,662 | 144,361 |
Deferred tax expense (benefit) | (166,951) | (85,824) | 11,449 |
Income tax expense | 128,582 | 111,838 | 155,810 |
Income (loss) from operating affiliates | 264,693 | 16,766 | 2,233 |
Net income | 2,239,462 | 1,465,711 | 1,693,300 |
Net (income) loss attributable to noncontrolling interests | (82,613) | (60,190) | (56,981) |
Net income available to Arch | 2,156,849 | 1,405,521 | 1,636,319 |
Preferred share dividends | (48,343) | (41,612) | (41,612) |
Loss on redemption of preferred shares | (15,101) | 0 | 0 |
Net income available to Arch common shareholders | $ 2,093,405 | $ 1,363,909 | $ 1,594,707 |
Net income per common share and common share equivalent | |||
Basic (per share) | $ 5.34 | $ 3.38 | $ 3.97 |
Diluted (per share) | $ 5.23 | $ 3.32 | $ 3.87 |
Weighted average common shares and common share equivalents outstanding | |||
Basic (shares) | 391,748,715 | 403,062,179 | 401,802,815 |
Diluted (shares) | 400,345,936 | 410,259,455 | 411,609,478 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Comprehensive Income | |||
Net income | $ 2,239,462 | $ 1,465,711 | $ 1,693,300 |
Unrealized appreciation (decline) in value of available-for-sale investments: | |||
Unrealized holding gains (losses) arising during year | (386,929) | 678,717 | 500,771 |
Reclassification of net realized (gains) losses, included in net income | (116,068) | (426,187) | (118,941) |
Foreign currency translation adjustments | (64,482) | 33,336 | 18,110 |
Comprehensive income | 1,671,983 | 1,751,577 | 2,093,240 |
Net (income) loss attributable to noncontrolling interests | (82,613) | (60,190) | (56,981) |
Other comprehensive (income) loss attributable to noncontrolling interests | 13,984 | (9,062) | (9,130) |
Comprehensive income available to Arch | $ 1,603,354 | $ 1,682,325 | $ 2,027,129 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Total | Non-cumulative preferred shares | Common shares | Additional paid-in capital | Retained earnings | Retained earningsCumulative Effect, Period of Adoption, Adjustment | Retained earningsCumulative Effect, Period of Adoption, Adjusted Balance | Accumulated other comprehensive income (loss) | Unrealized appreciation (decline) in value of available-for-sale investments, net of deferred income tax | Foreign currency translation adjustments, net of deferred income tax | Common shares held in treasury, at cost |
Balance at beginning of year at Dec. 31, 2018 | $ 780,000 | $ 634 | $ 1,793,781 | $ 9,426,299 | $ 0 | $ 9,426,299 | $ (178,720) | $ (114,178) | $ (64,542) | $ (2,382,167) | |
Preferred shares issued | 0 | ||||||||||
Preferred shares redeemed | 0 | ||||||||||
Common shares issued, net | 4 | ||||||||||
Issue costs on preferred shares issued | 0 | ||||||||||
Loss on redemption of preferred shares | $ 0 | 0 | 0 | ||||||||
Amortization of share-based compensation | 64,152 | ||||||||||
Other changes | 31,750 | ||||||||||
Net income | 1,693,300 | 1,693,300 | |||||||||
Net (income) loss attributable to noncontrolling interests | (56,981) | (56,981) | |||||||||
Preferred share dividends | (41,612) | (41,612) | |||||||||
Unrealized holding gains (losses) during period, net of reclassification adjustment | 381,830 | ||||||||||
Unrealized holding gains (losses) during period attributable to noncontrolling interests | (9,166) | ||||||||||
Foreign currency translation adjustments | 18,110 | 18,110 | |||||||||
Foreign currency translation adjustments attributable to noncontrolling interests | 37 | ||||||||||
Shares repurchased for treasury | (2,871) | (23,880) | |||||||||
Balance at end of year at Dec. 31, 2019 | 11,497,371 | 780,000 | 638 | 1,889,683 | 11,021,006 | (22,452) | 10,998,554 | 212,091 | 258,486 | (46,395) | (2,406,047) |
Non-redeemable noncontrolling interests | 762,777 | ||||||||||
Total shareholders' equity | 12,260,148 | ||||||||||
Preferred shares issued | 0 | ||||||||||
Preferred shares redeemed | 0 | ||||||||||
Common shares issued, net | 5 | ||||||||||
Issue costs on preferred shares issued | 0 | ||||||||||
Loss on redemption of preferred shares | 0 | 0 | 0 | ||||||||
Amortization of share-based compensation | 70,535 | ||||||||||
Other changes | 17,576 | ||||||||||
Net income | 1,465,711 | 1,465,711 | |||||||||
Net (income) loss attributable to noncontrolling interests | (60,190) | (60,190) | |||||||||
Preferred share dividends | (41,612) | (41,612) | |||||||||
Unrealized holding gains (losses) during period, net of reclassification adjustment | 252,530 | ||||||||||
Unrealized holding gains (losses) during period attributable to noncontrolling interests | (9,721) | ||||||||||
Foreign currency translation adjustments | 33,336 | 33,336 | |||||||||
Foreign currency translation adjustments attributable to noncontrolling interests | 659 | ||||||||||
Shares repurchased for treasury | (83,472) | (97,862) | |||||||||
Balance at end of year at Dec. 31, 2020 | $ 13,105,886 | 780,000 | 643 | 1,977,794 | 12,362,463 | $ 0 | $ 12,362,463 | 488,895 | 501,295 | (12,400) | (2,503,909) |
Accounting Standards Update [Extensible Enumeration] | Accounting Standards Update 2016-13 [Member] | ||||||||||
Non-redeemable noncontrolling interests | $ 823,007 | ||||||||||
Total shareholders' equity | 13,928,893 | ||||||||||
Preferred shares issued | 500,000 | ||||||||||
Preferred shares redeemed | (450,000) | ||||||||||
Common shares issued, net | 5 | ||||||||||
Issue costs on preferred shares issued | (14,179) | ||||||||||
Loss on redemption of preferred shares | (15,101) | 15,101 | (15,101) | ||||||||
Amortization of share-based compensation | 86,053 | ||||||||||
Other changes | 20,306 | ||||||||||
Net income | 2,239,462 | 2,239,462 | |||||||||
Net (income) loss attributable to noncontrolling interests | (82,613) | (82,613) | |||||||||
Preferred share dividends | (48,343) | (48,343) | |||||||||
Unrealized holding gains (losses) during period, net of reclassification adjustment | (502,997) | ||||||||||
Unrealized holding gains (losses) during period attributable to noncontrolling interests | 15,188 | ||||||||||
Foreign currency translation adjustments | (64,482) | (64,482) | |||||||||
Foreign currency translation adjustments attributable to noncontrolling interests | (1,204) | ||||||||||
Shares repurchased for treasury | (1,234,294) | (1,257,186) | |||||||||
Balance at end of year at Dec. 31, 2021 | 13,545,896 | $ 830,000 | $ 648 | $ 2,085,075 | $ 14,455,868 | $ (64,600) | $ 13,486 | $ (78,086) | $ (3,761,095) | ||
Non-redeemable noncontrolling interests | 0 | ||||||||||
Total shareholders' equity | $ 13,545,896 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating Activities | |||
Net income | $ 2,239,462 | $ 1,465,711 | $ 1,693,300 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Net realized (gains) losses | (427,367) | (844,625) | (377,967) |
Equity in net income or loss of investments accounted for using the equity method and other income or loss | (464,050) | (47,951) | (14,013) |
Amortization of intangible assets | 82,955 | 69,031 | 82,104 |
Share-based compensation | 87,094 | 71,262 | 66,417 |
Changes in: | |||
Reserve for losses and loss adjustment expenses, net of unpaid losses and loss adjustment expenses recoverable | 1,762,190 | 2,113,827 | 489,981 |
Unearned premiums, net of ceded unearned premiums | 936,039 | 445,781 | 252,569 |
Premiums receivable | (685,214) | (318,643) | (237,752) |
Deferred acquisition costs | (263,243) | (143,948) | (47,260) |
Reinsurance balances payable | 500,065 | 65,950 | 182,132 |
Other items, net | (340,376) | 10,110 | (41,052) |
Net cash provided by operating activities | 3,427,555 | 2,886,505 | 2,048,459 |
Investing Activities: | |||
Purchases of fixed maturity investments | (35,451,858) | (39,765,277) | (30,053,777) |
Purchases of equity securities | (1,175,480) | (1,595,010) | (811,967) |
Purchases of other investments | (1,859,096) | (1,808,727) | (1,470,545) |
Proceeds from the sale of fixed maturity investments | 33,577,445 | 37,949,346 | 28,595,865 |
Proceeds from sales of equity securities | 918,145 | 1,147,264 | 429,818 |
Proceeds from sales, redemptions and maturities of other investments | 1,765,533 | 1,029,578 | 1,209,559 |
Proceeds from redemptions and maturities of fixed maturity investments | 1,628,755 | 871,134 | 643,265 |
Net settlements of derivative instruments | (40,072) | 179,006 | 59,982 |
Net (purchases) sales of short-term investments | 165,272 | (1,029,681) | 39,833 |
Change in cash collateral related to securities lending | 0 | 81,210 | (62,193) |
Purchase of operating affiliate | (753,916) | 0 | 0 |
Impact of the deconsolidation of the variable interest entity | (349,202) | 0 | 0 |
Purchases of fixed assets | (41,394) | (39,872) | (37,837) |
Other | (523,864) | (62,197) | (348,486) |
Net cash provided by (used for) investing activities | (2,139,732) | (3,043,226) | (1,806,483) |
Financing Activities: | |||
Proceeds from issuance of preferred shares, net | 485,821 | 0 | 0 |
Redemption of preferred shares | (450,000) | 0 | 0 |
Purchases of common shares under share repurchase program | (1,234,294) | (83,472) | (2,871) |
Proceeds from common shares issued, net | 6,418 | 1,876 | 6,203 |
Proceeds from borrowings | 0 | 1,018,793 | 200,083 |
Repayments of borrowings | 0 | (359,000) | (49,182) |
Change in cash collateral related to securities lending | 0 | (81,210) | 62,193 |
Change in third party investment in non-redeemable noncontrolling interests | 15,971 | (2,867) | (75,056) |
Change in third party investment in redeemable noncontrolling interests | 0 | 0 | (161,882) |
Dividends paid to redeemable noncontrolling interests | (1,907) | (4,945) | (12,515) |
Other | (3,278) | 73,715 | (6,023) |
Preferred dividends paid | (48,280) | (41,612) | (41,612) |
Net Cash Provided by (Used in) Financing Activities | (1,229,549) | 521,278 | (80,662) |
Effects of exchange rate changes on foreign currency cash and restricted cash | (34,047) | 22,289 | 17,741 |
Increase (decrease) in cash and restricted cash | 24,227 | 386,846 | 179,055 |
Cash and restricted cash, beginning of year | 1,290,544 | 903,698 | 724,643 |
Cash and restricted cash, end of year | 1,314,771 | 1,290,544 | 903,698 |
Supplemental cash flow information | |||
Income taxes paid (received) | 286,810 | 202,940 | 109,463 |
Interest paid | $ 139,301 | $ 133,491 | $ 126,945 |
General
General | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | Arch Capital Group Ltd. (“Arch Capital”) is a publicly listed Bermuda exempted company which provides insurance, reinsurance and mortgage insurance on a worldwide basis through its wholly owned subsidiaries. As used herein, the “Company” means Arch Capital and its subsidiaries. Similarly, “Common Shares” means the common shares of Arch Capital. The Company’s consolidated financial statements included the results of Somers Holdings Ltd. (formerly Watford Holdings Ltd.) and its wholly owned subsidiaries (“Somers”) through June 30, 2021. Effective July 1, 2021, Somers is wholly owned by Greysbridge Holdings Ltd., (“Greysbridge”) and Greysbridge is owned 40% by the Company, 30% by certain investment funds managed by Kelso & Company (“Kelso”) and 30% by certain investment funds managed by Warburg Pincus LLC (“Warburg”). Based on the governing documents of Greysbridge, the Company concluded that, while it retains significant influence over Somers, Somers no longer constitutes a variable interest entity. Accordingly, effective July 1, 2021, Arch no longer consolidates the results of Somers in its consolidated financial statements and footnotes. See note 12, “Variable Interest Entity and Noncontrolling Interests” . The Company has reclassified the presentation of certain prior year information to conform to the current presentation, including the correct presentation of ‘income (loss) from operating affiliates’ on its consolidated statements of income for all periods presented to reclass such item from ‘other income (loss)’. The Company also changed its presentation of ‘investment in operating affiliates’ on its consolidated balance sheet for all periods presented to reclass such item from ‘other assets’. Such reclassifications had no effect on the Company’s net income, comprehensive income, shareholders’ equity or cash flows. Management views the impact of the prior period misclassification as not material to the financial statements on a quantitative and qualitative basis. See note 9 . Tabular amounts are in U.S. Dollars in thousands, except share amounts, unless otherwise noted. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
Business Acquired | Westpac Lenders Mortgage Insurance Limited (“WLMI”) On August 31, 2021, the Company completed the acquisition of WLMI, an Australian Prudential Regulation Authority authorized captive lenders mortgage insurance (“LMI”) provider to the Westpac Banking Corporation (“Westpac”). As part of the acquisition, WLMI will retain its existing risk in force and remain Westpac’s exclusive provider of LMI on new mortgage originations for a period of 10 years. Upon completion of this transaction, the Company renamed WLMI to Arch Lenders Mortgage Indemnity Limited (“Arch Indemnity”). Arch Indemnity will become the Company’s primary provider of LMI to the Australian market. Somerset Bridge Group Limited, Southern Rock Holdings Limited and affiliates (“Somerset Group”) On August 6, 2021, the Company completed the acquisition of Somerset Group. The acquisition includes Somerset Group’s motor insurance managing general agent, distribution capabilities through direct and aggregator channels, affiliated insurer and fully integrated claims operation. In connection with the acquisitions noted above, the Company increased its goodwill and intangible assets by $350.1 million. Barbican Group Holdings Limited On November 29, 2019, the Company closed the acquisition of Barbican Group Holdings Limited and its subsidiaries (collectively, “Barbican”). The Ardonagh Group On January 1, 2019, the Company’s U.K. insurance operations entered into a transaction with The Ardonagh Group to acquire renewal rights for a U.K. commercial lines book of business, consisting of commercial property, casualty, motor, professional liability, personal accident and travel business. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Significant accounting policies | (a) Basis of Presentation The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of Arch Capital and its subsidiaries, including Arch Reinsurance Ltd. (“Arch Re Bermuda”), Arch Reinsurance Company (“Arch Re U.S.”), Arch Capital Group (U.S.) Inc.(“Arch-U.S.”), Arch Insurance Company, Arch Specialty Insurance Company, Arch Property & Casualty Insurance Company (“Arch P&C”), Arch Indemnity Insurance Company (“Arch Indemnity Insurance”), Arch Insurance Canada Ltd. (“Arch Insurance Canada”), Arch Reinsurance Europe Designated Activity Company (“Arch Re Europe”), Arch Mortgage Insurance Company (“AMIC”), Arch Mortgage Guaranty Company, United Guaranty Residential Insurance Company (“UGRIC”), Arch Indemnity, Arch Insurance (EU) Designated Activity Company (“Arch Insurance (EU)”), Arch Insurance (U.K.) Limited (“Arch Insurance (U.K.)”) and the Company’s participation on Lloyd’s of London syndicates 2012 (“Arch Syndicate 2012”) and 1955 (“Arch Syndicate 1955”). All significant intercompany transactions and balances have been eliminated in consolidation. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates and assumptions. The Company’s principal estimates include: • The reserve for losses and loss adjustment expenses; • Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses, including the provision for uncollectible amounts; • Estimates of written and earned premiums; • The valuation of the investment portfolio and assessment of allowance for credit losses; • The valuation of purchased intangible assets; • The assessment of goodwill and intangible assets for impairment; and • The valuation of deferred tax assets. (b) Premium Revenues and Related Expenses Insurance. Insurance premiums written are generally recorded at the policy inception and are primarily earned on a pro rata basis over the terms of the policies for all products, usually 12 months. Premiums written include estimates that are derived from multiple sources which include the historical experience of the underlying business, similar business and available industry information. Unearned premium reserves represent the portion of premiums written that relates to the unexpired terms of in-force insurance policies. Reinsurance. Reinsurance premiums written include amounts reported by brokers and ceding companies, supplemented by the Company’s own estimates of premiums where reports have not been received. The determination of premium estimates requires a review of the Company’s experience with the ceding companies, familiarity with each market, the timing of the reported information, an analysis and understanding of the characteristics of each line of business, and management’s judgment of the impact of various factors, including premium or loss trends, on the volume of business written and ceded to the Company. On an ongoing basis, the Company’s underwriters review the amounts reported by these third parties for reasonableness based on their experience and knowledge of the subject class of business, taking into account the Company’s historical experience with the brokers or ceding companies. In addition, reinsurance contracts under which the Company assumes business generally contain specific provisions which allow the Company to perform audits of the ceding company to ensure compliance with the terms and conditions of the contract, including accurate and timely reporting of information. Based on a review of all available information, management establishes premium estimates where reports have not been received. Premium estimates are updated when new information is received and differences between such estimates and actual amounts are recorded in the period in which estimates are changed or the actual amounts are determined. Reinsurance premiums written are recorded based on the type of contracts the Company writes. Premiums on the Company’s excess of loss and pro rata reinsurance contracts are estimated when the business is underwritten. For excess of loss contracts, premiums are recorded as written based on the terms of the contract. Estimates of premiums written under pro rata contracts are recorded in the period in which the underlying risks are expected to incept and are based on information provided by the brokers and the ceding companies. For multi-year reinsurance treaties which are payable in annual installments, generally, only the initial annual installment is included as premiums written at policy inception due to the ability of the reinsured to commute or cancel coverage during the term of the policy. The remaining annual installments are included as premiums written at each successive anniversary date within the multi-year term. Reinsurance premiums written, irrespective of the class of business, are generally earned on a pro rata basis over the terms of the underlying policies or reinsurance contracts. Contracts and policies written on a “losses occurring” basis cover claims that may occur during the term of the contract or policy, which is typically 12 months. Accordingly, the premium is earned evenly over the term. Contracts which are written on a “risks attaching” basis cover claims which attach to the underlying insurance policies written during the terms of such contracts. Premiums earned on such contracts usually extend beyond the original term of the reinsurance contract, typically resulting in recognition of premiums earned over a 24-month period. Certain of the Company’s reinsurance contracts include provisions that adjust premiums or acquisition expenses based upon the experience under the contracts. Premiums written and earned, as well as related acquisition expenses, are recorded based upon the projected experience under such contracts. The Company also writes certain reinsurance business that is intended to provide insurers with risk management solutions that complement traditional reinsurance. Under these contracts, the Company assumes a measured amount of insurance risk in exchange for an anticipated margin, which is typically lower than on traditional reinsurance contracts. The terms and conditions of these contracts may include additional or return premiums based on loss experience, loss corridors, sublimits and caps. Examples of such business include aggregate stop-loss coverages, financial quota share coverages and multi-year retrospectively rated excess of loss coverages. If these contracts are deemed to transfer risk, they are accounted for as reinsurance. Otherwise, such contracts are accounted for under the deposit method. Mortgage. Mortgage guaranty insurance policies are contracts that are generally non-cancelable by the insurer, are renewable at a fixed price, and provide for payment of premiums on a monthly, annual or single basis. Upon renewal, the Company is not able to re-underwrite or re-price its policies. Consistent with industry accounting practices, premiums written on a monthly basis are earned as coverage is provided. Premiums written on an annual basis are amortized on a monthly pro rata basis over the year of coverage. Primary mortgage insurance premiums written on policies covering more than one year are referred to as single premiums. A portion of the revenue from single premiums is recognized in premiums earned in the current period, and the remaining portion is deferred as unearned premiums and earned over the estimated expiration of risk of the policy. If single premium policies related to insured loans are canceled due to repayment by the borrower and the policy is a non-refundable product, the remaining unearned premium related to each canceled policy is recognized as earned premium upon notification of the cancellation. Reinstatement premiums for the Company’s insurance and reinsurance operations are recognized at the time a loss event occurs, where coverage limits for the remaining life of the contract are reinstated under pre-defined contract terms. Reinstatement premiums, if obligatory, are fully earned when recognized. The accrual of reinstatement premiums is based on an estimate of losses and loss adjustment expenses, which reflects management’s judgment. Premium estimates are reviewed by management at least quarterly. Such review includes a comparison of actual reported premiums to expected ultimate premiums along with a review of the aging and collection of premium estimates. Based on management’s review, the appropriateness of the premium estimates is evaluated, and any adjustment to these estimates is recorded in the period in which it becomes known. Adjustments to premium estimates could be material and such adjustments could directly and significantly impact earnings favorably or unfavorably in the period they are determined because the estimated premium may be fully or substantially earned. A significant portion of amounts included as premiums receivable, which represent estimated premiums written, net of commissions, are not currently due based on the terms of the underlying contracts. Unearned premiums represent the portion of premiums written that is applicable to the estimated unexpired risk of insured loans. A portion of premium payments may be refundable if the insured cancels coverage, which generally occurs when the loan is repaid, the loan amortizes to a sufficiently low amount to trigger a lender permitted or legally required cancellation, or the value of the property has increased sufficiently in accordance with the terms of the contract. Premium refunds reduce premiums earned in the consolidated statements of income. Generally, only unearned premiums are refundable. Premiums receivable include amounts receivable from agents, brokers and insured that are both currently due and amounts not yet due on insurance, reinsurance and mortgage insurance policies. Premiums receivable balances are reported net of an allowance for expected credit losses. The Company monitors credit risk associated with premiums receivable through its ongoing review of amounts outstanding, aging of the receivable, historical loss data, and counterparty financial strength measures. The allowance also includes estimated uncollectible amounts related to dispute risk. In certain instances, credit risk may be reduced by the Company’s right to offset loss obligations or unearned premiums against premiums receivable. Any allowance for credit losses is charged to net realized gains (losses) in the period the receivable is recorded and revised in subsequent periods to reflect changes in the Company’s estimate of expected credit losses. See note 7, “Allowance for Expected Credit Losses” for additional information. Acquisition Costs. Acquisition costs that are directly related and incremental to the successful acquisition or renewal of business are deferred and amortized based on the type of contract. The Company’s insurance and reinsurance operations capitalize incremental direct external costs that result from acquiring a contract but do not capitalize salaries, benefits and other internal underwriting costs. For the Company’s mortgage insurance operations, which include a substantial direct sales force, both external and certain internal direct costs are deferred and amortized. For property and casualty insurance and reinsurance contracts, deferred acquisition costs are amortized over the period in which the related premiums are earned. Consistent with mortgage insurance industry accounting practice, amortization of acquisition costs related to the mortgage insurance contracts for each underwriting year’s book of business is recorded in proportion to estimated gross profits. Estimated gross profits are comprised of earned premiums and losses and loss adjustment expenses. For each underwriting year, the Company estimates the rate of amortization to reflect actual experience and any changes to persistency or loss development. Deferred acquisition costs are carried at their estimated realizable value and take into account anticipated losses and loss adjustment expenses, based on historical and current experience, and anticipated investment income. A premium deficiency occurs if the sum of anticipated losses and loss adjustment expenses, unamortized acquisition costs and maintenance costs exceed unearned premiums (including expected future premiums) and anticipated investment income. A premium deficiency reserve (“PDR”) is recorded by charging any unamortized acquisition costs to expense to the extent required in order to eliminate the deficiency. If the premium deficiency exceeds unamortized acquisition costs then a liability is accrued for the excess deficiency. To assess the need for a PDR on mortgage exposures, the Company develops loss projections based on modeled loan defaults related to its current policies in force. This projection is based on recent trends in default experience, severity and rates of defaulted loans moving to claim, as well as recent trends in the rate at which loans are prepaid, and incorporates anticipated interest income. Evaluating the expected profitability of the Company’s existing mortgage insurance business and the need for a PDR for its mortgage business involves significant reliance upon assumptions and estimates with regard to the likelihood, magnitude and timing of potential losses and premium revenues. No premium deficiency charges were recorded by the Company during 2021, 2020 or 2019. (c) Deposit Accounting Certain assumed reinsurance contracts that are deemed not to transfer insurance risk, are accounted for using the deposit method of accounting. However, it is possible that the Company could incur financial losses on such contracts. Management exercises significant judgment in the assumptions used in determining whether assumed contracts should be accounted for as reinsurance contracts or deposit contracts. For those contracts that contain only significant underwriting risk, the estimated profit margin is deferred and amortized over the contract period and such amount is included in the Company’s underwriting results. When the estimated profit margin is explicit, the margin is reflected as other underwriting income and any adverse financial results on such contracts are reflected as incurred losses. When the estimated profit margin is implicit, the margin is reflected as an offset to paid losses and any adverse financial results on such contracts are reflected as incurred losses. Additional judgments are required when applying the accounting guidance with respect to the revenue recognition criteria for contracts deemed to transfer only significant underwriting risk. For those contracts that contain only significant timing risk, an accretion rate is established at inception of the contract based on actuarial estimates whereby the deposit accounting liability is increased to the estimated amount payable over the contract term. The accretion on the deposit is based on the expected rate of return required to fund the expected future payment obligations. Periodically the Company reassesses the estimated ultimate liability and the related expected rate of return. The accretion of the deposit accounting liability as well as changes to the estimated ultimate liability and the accretion rate would be reflected as part of interest expense in the Company’s results of operations. Any negative accretion in a deposit accounting liability is shown in other underwriting income in the Company’s results of operations. Under some of these contracts, the ceding company retains the related assets on a funds-held basis. Such amounts are included in “Other assets” on the Company’s balance sheet. Interest income produced by those assets are recorded as part of net investment income in the Company's results of operations. (d) Retroactive Reinsurance Retroactive reinsurance reimburses a ceding company for liabilities incurred as a result of past insurable events covered by the underlying policies reinsured. In certain instances, reinsurance contracts cover losses both on a prospective basis and on a retroactive basis and, accordingly, the Company bifurcates the prospective and retrospective elements of these reinsurance contracts and accounts for each element separately where practical. Underwriting income generated in connection with retroactive reinsurance contracts is deferred and amortized into income over the settlement period while losses are charged to income immediately. Subsequent changes in estimated amount or timing of cash flows under such retroactive reinsurance contracts are accounted for by adjusting the previously deferred amount to the balance that would have existed had the revised estimate been available at the inception of the reinsurance transaction, with a corresponding charge or credit to income. (e) Reinsurance Ceded In the normal course of business, the Company purchases reinsurance to increase capacity and to limit the impact of individual losses and events on its underwriting results by reinsuring certain levels of risk with other insurance enterprises or reinsurers. The Company uses pro rata, excess of loss and facultative reinsurance contracts. Reinsurance ceding commissions that represent a recovery of acquisition costs are recognized as a reduction to acquisition costs while the remaining portion is deferred. The accompanying consolidated statement of income reflects premiums and losses and loss adjustment expenses and acquisition costs, net of reinsurance ceded. See note 8, “Reinsurance” for information on the Company's reinsurance usage. Reinsurance premiums ceded and unpaid losses and loss adjustment expenses recoverable are estimated in a manner consistent with that of the original policies issued and the terms of the reinsurance contracts. If the reinsurers are unable to satisfy their obligations under the agreements, the Company’s insurance or reinsurance subsidiaries would be liable for such defaulted amounts. Reinsurance recoverables are recorded as assets, predicated on the reinsurers’ ability to meet their obligations under the reinsurance agreements. In certain instances, the Company obtains collateral, including letters of credit and trust accounts to further reduce the credit exposure on its reinsurance recoverables. The Company reports its reinsurance recoverables net of an allowance for expected credit loss. The allowance is based upon the Company’s ongoing review of amounts outstanding, the financial condition of its reinsurers, amounts and form of collateral obtained and other relevant factors. A ratings based probability-of-default and loss-given-default methodology is used to estimate the allowance for expected credit loss. Any allowance for credit losses is charged to net realized gains (losses) in the period the recoverable is recorded and revised in s ubsequent periods to reflect changes in the Company’s estimate of expected credit losses . See note 7, “Allowance for Expected Credit Losses” for additional information. (f) Cash Cash includes cash equivalents, which are investments with original maturities of three months or less which are not part of the investment portfolio. (g) Restricted Cash Restricted cash represents amounts held for the benefit of third parties and is legally or contractually restricted as to withdrawal or usage by the Company. Such amounts are included in “Other assets” on the Company’s balance sheet. (h) Investments The Company currently classifies substantially all of its fixed maturity investments and short-term investments as “available for sale” and, accordingly, they are carried at estimated fair value (also known as fair value) with the changes in fair value recorded as an unrealized gain or loss component of accumulated other comprehensive income in shareholders’ equity. The fair value of fixed maturity securities and equity securities is generally determined from quotations received from nationally recognized pricing services, or when such prices are not available, by reference to broker or underwriter bid indications. Short-term investments comprise securities due to mature within one year of the date of issue. Short-term investments include certain cash equivalents which are part of investment portfolios under the management of external and internal investment managers. Prior to the termination of its program in 2021, the Company entered into securities lending agreements with financial institutions to enhance investment income whereby it loaned certain of its securities to third parties, primarily major brokerage firms, for short periods of time through a lending agent. Such securities have been reclassified as “Securities pledged under securities lending, at fair value.” The Company maintained legal control over the securities it lent, retained the earnings and cash flows associated with the loaned securities and received a fee from the borrower for the temporary use of the securities. Collateral received was required at a rate of 102% or greater of the fair value of the loaned securities including accrued investment income and was monitored and maintained by the lending agent. Such collateral is reflected as “Collateral received under securities lending, at fair value.” The Company’s investment portfolio includes certain funds that, due to their ownership structure, are accounted for by the Company using the equity method. In applying the equity method, these investments are initially recorded at cost and are subsequently adjusted based on the Company’s proportionate share of the net income or loss of the funds (which include changes in the fair value of the underlying securities in the funds). Such investments are generally recorded on a one three The Company’s investment portfolio includes equity securities that are accounted for at fair value. Such holdings primarily include publicly traded common stocks. Dividend income on equities is reflected in net investment income. Changes in fair value on equity securities are included in “Net realized gains (losses)” in the consolidated statement of income. The Company elected to carry certain fixed maturity securities, equity securities, short-term investments and other investments at fair value under the fair value option afforded by accounting guidance regarding the fair value option for financial assets and liabilities. The fair value for certain of the Company’s other investments are determined using net asset values (“NAVs”) as advised by external fund managers. The NAV is based on the fund manager’s valuation of the underlying holdings in accordance with the fund’s governing documents. Changes in fair value of investments accounted for using the fair value option are included in “Net realized gains (losses).” The primary reasons for electing the fair value option were to address simplification and cost-benefit considerations. The Company invests in reverse repurchase agreements that are generally treated as collateralized receivables. Receivables for reverse repurchase agreements are reflected in “Other investments” or “Short-term investments” in the Company's consolidated balance sheet depending on their terms. These agreements are recorded at their contracted resale amount plus accrued interest, other than those that are accounted for at fair value. In reverse repurchase transactions, the Company obtains an interest in the purchased assets that are received as collateral. The Company invests in limited partner interests and shares of limited liability companies. Such amounts are included in investments accounted for using the equity method and other investments. These investments can often have characteristics of a variable interest entity (“VIE”). A VIE refers to entities that have characteristics such as (i) insufficient equity at risk to allow the entity to finance its activities without additional financial support or (ii) instances where the equity investors, as a group, do not have the characteristic of a controlling financial interest. If the Company is determined to be the primary beneficiary, it is required to consolidate the VIE. The primary beneficiary is defined as the variable interest holder that is determined to have the controlling financial interest as a result of having both (i) the power to direct the activities of a VIE that most significantly impact the economic performance of the VIE and (ii) the obligation to absorb losses or right to receive benefits from the VIE that could potentially be significant to the VIE. At inception of the VIE as well as on an ongoing basis, the Company determines whether it is the primary beneficiary based on an analysis of the Company’s level of involvement in the VIE, the contractual terms, and the overall structure of the VIE. The Company's maximum exposure to loss with respect to these investments is limited to the investment carrying amounts reported in the Company's consolidated balance sheet and any unfunded commitment. The Company conducts a periodic review to identify and evaluate credit based impairments related to the Company’s available for sale investments. The Company derives estimated credit losses by comparing expected future cash flows to be collected to the amortized cost of the security. Estimates of expected future cash flows consider among other things, macroeconomic conditions as well as the financial condition, near-term and long-term prospects for the issuer, and the likelihood of the recoverability of principal and interest. Effective January 1, 2020, credit losses are recognized through an allowance account subject to reversal, rather than a reduction in amortized cost. Declines in value attributable to factors other than credit are reported in other comprehensive income while the allowance for credit loss is charged to net realized gains (losses). For available for sale investments that the Company intends to sell or for which it is more likely than not that the Company would be required to sell before an anticipated recovery in value, the full amount of the impairment is included in net realized gains (losses). The new cost basis of the investment is the previous amortized cost basis reduced by the impairment recognized in net realized gains (losses). The new cost basis is not adjusted for any subsequent recoveries in fair value. The Company reports accrued investment income separately from investment balances and has elected not to measure an allowance for credit losses for accrued investment income . Any uncollectible accrued interest income is written off in the period it is deemed uncollectible. Prior to January 1, 2020, the Company performed quarterly reviews of its investments to determine whether declines in fair value below the cost basis were considered other-than-temporary in accordance with applicable accounting guidance regarding the recognition and presentation of OTTI. The process of determining whether a security was other-than-temporarily impaired required judgment and involved analyzing many factors. These factors included (i) an analysis of the liquidity, business prospects and overall financial condition of the issuer, (ii) the time period in which there was a significant decline in value, (iii) the significance of the decline and (iv) the analysis of specific credit events. When there were credit-related losses associated with debt securities for which the Company did not have an intent to sell and it was more likely than not that it would not be required to sell the security before recovery of its cost basis, the amount of the OTTI related to a credit loss was recognized in earnings and the amount of the OTTI related to other factors ( e.g. , interest rates, market conditions, etc.) was recorded as a component of other comprehensive income (loss). The amount of the credit loss of an impaired debt security was the difference between the amortized cost and the greater of (i) the present value of expected future cash flows and (ii) the fair value of the security. In instances where no credit loss existed but it was more likely than not that the Company would have to sell the debt security prior to the anticipated recovery, the decline in fair value below amortized cost was recognized as an OTTI in earnings. In periods after the recognition of an OTTI on debt securities, the Company accounted for such securities as if they had been purchased on the measurement date of the OTTI at an amortized cost basis equal to the previous amortized cost basis less the OTTI recognized in earnings. For debt securities for which OTTI were recognized in earnings, the difference between the new amortized cost basis and the cash flows expected to be collected would be accreted or amortized into net investment income. See note 9, “Investment Information” for additional information. Net investment income includes interest and dividend income together with amortization of market premiums and discounts and is net of investment management and custody fees. Anticipated prepayments and expected maturities are used in applying the interest method for certain investments such as mortgage and other asset-backed securities. When actual prepayments differ significantly from anticipated prepayments, the effective yield is recalculated to reflect actual payments to date and anticipated future payments. The net investment in such securities is adjusted to the amount that would have existed had the new effective yield been applied since the acquisition of the security. Such adjustments, if any, are included in net investment income when determined. Investment gains or losses realized on the sale of investments, except for certain fund investments, are determined on a first-in, first-out basis and are reflected in net income. Investment gains or losses realized on the sale of certain fund investments are determined on an average cost basis. Unrealized appreciation or decline in the value of available for sale securities, which are carried at fair value, is excluded from net income and recorded as a separate component of accumulated other comprehensive income, net of applicable deferred income tax. (i) Derivative Instruments The Company recognizes all derivative instruments, including embedded derivative instruments, at fair value in its consolidated balance sheets. The Company employs the use of derivative instruments within its operations to mitigate risks arising from assets and liabilities held in foreign currencies as well as part of its overall investment strategy. For such instruments, changes in assets and liabilities measured at fair value are recorded as “Net realized gains” in the consolidated statements of income. In addition, the Company’s derivative instruments include amounts related to underwriting activities where an insurance or reinsurance contract meets the accounting definition of a derivative instrument. For such contracts, changes in fair value are reflected in “Other underwriting income” in the consolidated statements of income as the underlying contract originates from the Company’s underwriting operations. For the periods ended 2021, 2020, and 2019, the Company did not designate any derivative instruments as hedges under the relevant accounting guidance. See note 11, “Derivative Instruments” for additional information. (j) Reserves for Losses and Loss Adjustment Expenses Insurance and Reinsurance. The reserve for losses and loss adjustment expenses consists of estimates of unpaid reported losses and loss adjustment expenses and estimates for losses incurred but not reported. The reserve for unpaid reported losses and loss adjustment expenses, established by management based on reports from ceding companies and claims from insureds, excludes estimates of amounts related to losses under high deductible policies, and represents the estimated ultimate cost of events or conditions that have been reported to or specifically identified by the Company. Such reserves are supplemented by management’s estimates of reserves for losses incurred for which reports or claims have not been received. The Company’s reserves are based on a combination of reserving methods, incorporating both Company and industry loss development patterns. The Company selects the initial expected loss and loss adjustment expense ratios |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | The Company classifies its businesses into three underwriting segments– insurance, reinsurance and mortgage– and two operating segments– corporate and ‘other.’ The Company determined its reportable segments using the management approach described in accounting guidance regarding disclosures about segments of an enterprise and related information. The accounting policies of the segments are the same as those used for the preparation of the Company’s consolidated financial statements. Intersegment business is allocated to the segment accountable for the underwriting results. The Company’s insurance, reinsurance and mortgage segments each have managers who are responsible for the overall profitability of their respective segments and who are directly accountable to the Company’s chief operating decision makers, the Chief Executive Officer of Arch Capital, Chief Financial Officer and Treasurer of Arch Capital and the President and Chief Underwriting Officer of Arch Capital. The chief operating decision makers do not assess performance, measure return on equity or make resource allocation decisions on a line of business basis. Management measures segment performance for its three underwriting segments based on underwriting income or loss. The Company does not manage its assets by underwriting segment, with the exception of goodwill and intangible assets, and, accordingly, investment income is not allocated to each underwriting segment. The insurance segment consists of the Company’s insurance underwriting units which offer specialty product lines on a worldwide basis. Product lines include: • Construction and national accounts: primary and excess casualty coverages to middle and large accounts in the construction industry and a wide range of products for middle and large national accounts, specializing in loss sensitive primary casualty insurance programs (including large deductible, self-insured retention and retrospectively rated programs). • Excess and surplus casualty: primary and excess casualty insurance coverages, including middle market energy business, and contract binding, which primarily provides casualty coverage through a network of appointed agents to small and medium risks. • Lenders products: collateral protection, debt cancellation and service contract reimbursement products to banks, credit unions, automotive dealerships and original equipment manufacturers and other specialty programs that pertain to automotive lending and leasing. • Professional lines: directors’ and officers’ liability, errors and omissions liability, employment practices liability, fiduciary liability, crime, professional indemnity and other financial related coverages for corporate, private equity, venture capital, real estate investment trust, limited partnership, financial institution and not-for-profit clients of all sizes and medical professional and general liability insurance coverages for the healthcare industry. The business is predominately written on a claims-made basis. • Programs: primarily package policies, underwriting workers’ compensation and umbrella liability business in support of desirable package programs, targeting program managers with unique expertise and niche products offering general liability, commercial automobile, inland marine and property business with minimal catastrophe exposure. • Property, energy, marine and aviation: primary and excess general property insurance coverages, including catastrophe-exposed property coverage, for commercial clients. Coverages for marine include hull, war, specie and liability. Aviation and stand-alone terrorism are also offered. • Travel, accident and health: specialty travel and accident and related insurance products for individual, group travelers, travel agents and suppliers, as well as accident and health, which provides accident, disability and medical plan insurance coverages for employer groups, medical plan members, students and other participant groups. • Other: includes alternative market risks (including captive insurance programs), excess workers’ compensation and employer’s liability insurance coverages for qualified self-insured groups, associations and trusts, and contract and commercial surety coverages, including contract bonds (payment and performance bonds) primarily for medium and large contractors and commercial surety bonds for Fortune 1000 companies and smaller transaction business programs. The reinsurance segment consists of the Company’s reinsurance underwriting units which offer specialty product lines on a worldwide basis. Product lines include: • Casualty: provides coverage to ceding company clients on third party liability and workers’ compensation exposures from ceding company clients, primarily on a treaty basis. Exposures include, among others, executive assurance, professional liability, workers’ compensation, excess and umbrella liability, excess motor and healthcare business. • Marine and aviation: provides coverage for energy, hull, cargo, specie, liability and transit, and aviation business, including airline and general aviation risks. Business written may also include space business, which includes coverages for satellite assembly, launch and operation for commercial space programs. • Other specialty: provides coverage to ceding company clients for proportional motor and other lines including surety, accident and health, workers’ compensation catastrophe, agriculture, trade credit and political risk. • Property catastrophe: provides protection for most catastrophic losses that are covered in the underlying policies written by reinsureds, including hurricane, earthquake, flood, tornado, hail and fire, and coverage for other perils on a case-by-case basis. Property catastrophe reinsurance provides coverage on an excess of loss basis when aggregate losses and loss adjustment expense from a single occurrence of a covered peril exceed the retention specified in the contract. • Property excluding property catastrophe: provides coverage for both personal lines and commercial property exposures and principally covers buildings, structures, equipment and contents. The primary perils in this business include fire, explosion, collapse, riot, vandalism, wind, tornado, flood and earthquake. Business is assumed on both a proportional and excess of loss basis. In addition, facultative business is written which focuses on commercial property risks on an excess of loss basis. • Other. includes life reinsurance business on both a proportional and non-proportional basis, casualty clash business and, in limited instances, non-traditional business which is intended to provide insurers with risk management solutions that complement traditional reinsurance. The mortgage segment includes the Company’s U.S. primary mortgage insurance, U.S. credit risk transfer (“CRT”) which are predominately with government sponsored enterprises (“GSE”) and international mortgage insurance and reinsurance operations. AMIC and UGRIC (combined “Arch MI U.S.”) are approved as eligible mortgage insurers by Federal National Mortgage Association (“Fannie Mae”) and Federal Home Loan Mortgage Corporation (“Freddie Mac”), each a GSE. Arch MI U.S. also includes Arch Mortgage Guaranty Company, which is not a GSE-approved entity. The corporate segment results include net investment income, net realized gains or losses (which includes changes in the allowance for credit losses on financial assets and net impairment losses recognized in earnings), equity in net income or loss of investments accounted for using the equity method, other income (loss), corporate expenses, transaction costs and other, amortization of intangible assets, interest expense, net foreign exchange gains or losses, income taxes, income or loss from operating affiliates and items related to the Company’s non-cumulative preferred shares. Such amounts exclude the results of the ‘other’ segment. The ‘other’ segment included the results of Somers through June 30, 2021. In July 2021, the Company completed the previously disclosed acquisition of Somers by Greysbridge. Based on the governing documents of Greysbridge, the Company concluded that, while it retains significant influence over Somers, Somers no longer constitutes a variable interest entity. Accordingly, effective July 1, 2021, Arch no longer consolidates the results of Somers in its consolidated financial statements (see note 12, “Variable Interest Entity and Noncontrolling Interests” ). The following tables summarize the Company’s underwriting income or loss by segment, together with a reconciliation of underwriting income or loss to net income available to Arch common shareholders, summary information regarding net premiums written and earned by major line of business and net premiums written by location: Year Ended December 31, 2021 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 5,867,734 $ 5,093,930 $ 1,507,825 $ 12,463,788 $ 457,465 $ 12,752,487 Premiums ceded (1,719,541) (1,839,556) (246,757) (3,800,153) (102,763) (3,734,150) Net premiums written 4,148,193 3,254,374 1,261,068 8,663,635 354,702 9,018,337 Change in unearned premiums (521,725) (413,931) 22,351 (913,305) (22,734) (936,039) Net premiums earned 3,626,468 2,840,443 1,283,419 7,750,330 331,968 8,082,298 Other underwriting income (loss) — 3,669 17,665 21,334 739 22,073 Losses and loss adjustment expenses (2,344,365) (1,924,719) (56,677) (4,325,761) (259,042) (4,584,803) Acquisition expenses (606,265) (536,754) (97,418) (1,240,437) (62,741) (1,303,178) Other operating expenses (558,906) (212,810) (194,010) (965,726) (32,869) (998,595) Underwriting income (loss) $ 116,932 $ 169,829 $ 952,979 1,239,740 (21,945) 1,217,795 Net investment income 346,808 42,310 389,118 Net realized gains (losses) 299,207 80,638 379,845 Equity in net income (loss) of investments accounted for using the equity method 366,402 — 366,402 Other income (loss) 10,244 — 10,244 Corporate expenses (77,119) — (77,119) Transaction costs and other (1,103) (935) (2,038) Amortization of intangible assets (82,057) (898) (82,955) Interest expense (131,060) (8,410) (139,470) Net foreign exchange gains (losses) 42,854 (1,325) 41,529 Income (loss) before income taxes and income (loss) from operating affiliates 2,013,916 89,435 2,103,351 Income tax expense (128,348) (234) (128,582) Income (loss) from operating affiliates 264,693 — 264,693 Net income (loss) 2,150,261 89,201 2,239,462 Amounts attributable to redeemable noncontrolling interests (2,346) (1,953) (4,299) Amounts attributable to nonredeemable noncontrolling interests — (78,314) (78,314) Net income (loss) available to Arch 2,147,915 8,934 2,156,849 Preferred dividends (48,343) — (48,343) Loss on redemption of preferred shares (15,101) — (15,101) Net income (loss) available to Arch common shareholders $ 2,084,471 $ 8,934 $ 2,093,405 Underwriting Ratios Loss ratio 64.6 % 67.8 % 4.4 % 55.8 % 78.0 % 56.7 % Acquisition expense ratio 16.7 % 18.9 % 7.6 % 16.0 % 18.9 % 16.1 % Other operating expense ratio 15.4 % 7.5 % 15.1 % 12.5 % 9.9 % 12.4 % Combined ratio 96.7 % 94.2 % 27.1 % 84.3 % 106.8 % 85.2 % Goodwill and intangible assets $ 256,434 $ 183,523 $ 505,026 $ 944,983 $ — $ 944,983 Total investable assets $ 27,442,153 $ — $ 27,442,153 Total assets 45,100,945 — 45,100,945 Total liabilities 31,545,816 — 31,545,816 (1) Certain amounts included in the gross premiums written of each segment are related to intersegment transactions. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total. Year Ended December 31, 2020 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 4,688,562 $ 3,472,086 $ 1,473,999 $ 9,632,691 $ 728,546 $ 10,088,068 Premiums ceded (1,525,655) (1,014,716) (194,149) (2,732,564) (190,957) (2,650,352) Net premiums written 3,162,907 2,457,370 1,279,850 6,900,127 537,589 7,437,716 Change in unearned premiums (291,487) (295,141) 118,085 (468,543) 22,762 (445,781) Net premiums earned 2,871,420 2,162,229 1,397,935 6,431,584 560,351 6,991,935 Other underwriting income (31) 4,454 20,316 24,739 2,045 26,784 Losses and loss adjustment expenses (2,092,453) (1,628,320) (528,344) (4,249,117) (440,482) (4,689,599) Acquisition expenses, net (418,483) (354,048) (134,240) (906,771) (98,071) (1,004,842) Other operating expenses (489,153) (168,011) (162,202) (819,366) (55,810) (875,176) Underwriting income (loss) $ (128,700) $ 16,304 $ 593,465 481,069 (31,967) 449,102 Net investment income 401,908 117,700 519,608 Net realized gains (losses) 813,781 9,679 823,460 Equity in net income (loss) of investments accounted for using the equity method 146,693 — 146,693 Other income (loss) 29 — 29 Corporate expenses (68,492) — (68,492) Transaction costs and other (9,456) (4,040) (13,496) Amortization of intangible assets (69,031) — (69,031) Interest expense (120,214) (23,242) (143,456) Net foreign exchange gains (losses) (80,161) (3,473) (83,634) Income (loss) before income taxes and income (loss) from operating affiliates 1,496,126 64,657 1,560,783 Income tax (expense) benefit (111,812) (26) (111,838) Income (loss) from operating affiliates 16,766 — 16,766 Net income (loss) 1,401,080 64,631 1,465,711 Amounts attributable to redeemable noncontrolling interests (2,997) (4,117) (7,114) Amounts attributable to nonredeemable noncontrolling interests — (53,076) (53,076) Net income (loss) available to Arch 1,398,083 7,438 1,405,521 Preferred dividends (41,612) — (41,612) Net income (loss) available to Arch common shareholders $ 1,356,471 $ 7,438 $ 1,363,909 Underwriting Ratios Loss ratio 72.9 % 75.3 % 37.8 % 66.1 % 78.6 % 67.1 % Acquisition expense ratio 14.6 % 16.4 % 9.6 % 14.1 % 17.5 % 14.4 % Other operating expense ratio 17.0 % 7.8 % 11.6 % 12.7 % 10.0 % 12.5 % Combined ratio 104.5 % 99.5 % 59.0 % 92.9 % 106.1 % 94.0 % Goodwill and intangible assets $ 280,978 $ 18,963 $ 385,272 $ 685,213 $ 7,650 $ 692,863 Total investable assets $ 26,856,295 $ 2,657,612 $ 29,513,907 Total assets 39,791,983 3,490,314 43,282,297 Total liabilities 26,789,149 2,505,707 29,294,856 (1) Certain amounts included in the gross premiums written of each segment are related to intersegment transactions. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total. Year Ended December 31, 2019 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 3,907,993 $ 2,323,223 $ 1,466,265 $ 7,695,645 $ 754,881 $ 8,138,960 Premiums ceded (1,266,267) (720,500) (204,509) (2,189,440) (222,019) (2,099,893) Net premiums written 2,641,726 1,602,723 1,261,756 5,506,205 532,862 6,039,067 Change in unearned premiums (244,646) (136,334) 104,584 (276,396) 23,827 (252,569) Net premiums earned 2,397,080 1,466,389 1,366,340 5,229,809 556,689 5,786,498 Other underwriting income — 6,444 16,005 22,449 2,412 24,861 Losses and loss adjustment expenses (1,615,475) (1,011,329) (53,513) (2,680,317) (453,135) (3,133,452) Acquisition expenses, net (361,614) (239,032) (134,319) (734,965) (105,980) (840,945) Other operating expenses (454,770) (141,484) (153,092) (749,346) (51,651) (800,997) Underwriting income (loss) $ (34,779) $ 80,988 $ 1,041,421 1,087,630 (51,665) 1,035,965 Net investment income 491,067 136,671 627,738 Net realized gains (losses) 348,037 15,161 363,198 Equity in net income (loss) of investments accounted for using the equity method 123,672 — 123,672 Corporate expenses (65,667) — (65,667) Transaction costs and other (14,444) — (14,444) Amortization of intangible assets (82,104) — (82,104) Interest expense (93,735) (27,137) (120,872) Net foreign exchange gains (losses) (9,252) (11,357) (20,609) Income (loss) before income taxes and income (loss) from operating affiliates 1,785,204 61,673 1,846,877 Income tax benefit (155,790) (20) (155,810) Income (loss) from operating affiliates 2,233 — 2,233 Net income 1,631,647 61,653 1,693,300 Amounts attributable to redeemable noncontrolling interests — (16,909) (16,909) Amounts attributable to nonredeemable noncontrolling interests — (40,072) (40,072) Net income (loss) available to Arch 1,631,647 4,672 1,636,319 Preferred dividends (41,612) — (41,612) Net income (loss) available to Arch common shareholders $ 1,590,035 $ 4,672 $ 1,594,707 Underwriting Ratios Loss ratio 67.4 % 69.0 % 3.9 % 51.3 % 81.4 % 54.2 % Acquisition expense ratio 15.1 % 16.3 % 9.8 % 14.1 % 19.0 % 14.5 % Other operating expense ratio 19.0 % 9.6 % 11.2 % 14.3 % 9.3 % 13.8 % Combined ratio 101.5 % 94.9 % 24.9 % 79.7 % 109.7 % 82.5 % Goodwill and intangible assets $ 289,021 $ 2,516 $ 438,896 $ 730,433 $ 7,650 $ 738,083 Total investable assets $ 22,285,676 $ 2,704,589 $ 24,990,265 Total assets 34,374,468 3,510,893 37,885,361 Total liabilities 22,977,636 2,592,173 25,569,809 (1) Certain amounts included in the gross premiums written of each segment are related to intersegment transactions. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total. The following tables provide summary information regarding net premiums earned by major line of business and net premiums written by underwriting location: INSURANCE SEGMENT Year Ended December 31, 2021 2020 2019 Net premiums earned (1) Professional Lines (2) $ 942,817 $ 655,872 $ 499,224 Property, energy, marine and aviation 702,693 517,247 298,966 Programs 506,867 432,854 414,103 Construction and national accounts 381,306 387,934 325,687 Excess and surplus casualty (3) 318,027 270,620 200,615 Travel, accident and health 255,590 190,944 305,085 Lenders products 153,958 114,687 66,079 Other (4) 365,210 301,262 287,321 Total $ 3,626,468 $ 2,871,420 $ 2,397,080 Net premiums written by underwriting location (1) United States $ 2,813,039 $ 2,158,415 $ 1,983,476 Europe 1,125,192 856,572 559,214 Other 209,962 147,920 99,036 Total $ 4,148,193 $ 3,162,907 $ 2,641,726 (1) Insurance segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions. (2) Includes professional liability, executive assurance and healthcare business. (3) Includes casualty and contract binding business. (4) Includes alternative markets, excess workers' compensation and surety business. REINSURANCE SEGMENT Year Ended December 31, 2021 2020 2019 Net premiums earned (1) Property excluding property catastrophe $ 836,573 $ 562,208 $ 362,841 Other Specialty (2) 818,801 626,409 478,517 Casualty (3) 666,754 549,056 429,288 Property catastrophe 280,738 237,736 90,934 Marine and aviation 152,955 109,624 48,274 Other (4) 84,622 77,196 56,535 Total $ 2,840,443 $ 2,162,229 $ 1,466,389 Net premiums written by underwriting location (1) United States $ 828,504 $ 687,622 $ 529,943 Bermuda 1,557,294 1,001,990 578,618 Europe and other 868,576 767,758 494,162 Total $ 3,254,374 $ 2,457,370 $ 1,602,723 (1) Reinsurance segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions. (2) Includes proportional motor, surety, accident and health, workers’ compensation catastrophe, agriculture, trade credit and other. (3) Includes executive assurance, professional liability, workers’ compensation, excess motor, healthcare and other. (4) Includes life, casualty clash and other. MORTGAGE SEGMENT Year Ended December 31, 2021 2020 2019 Net premiums earned by underwriting location United States $ 970,507 $ 1,158,563 $ 1,134,849 Other 312,912 239,372 231,491 Total $ 1,283,419 $ 1,397,935 $ 1,366,340 Net premiums written by underwriting location United States $ 914,477 $ 1,021,950 $ 1,032,868 Other 346,591 257,900 228,888 Total $ 1,261,068 $ 1,279,850 $ 1,261,756 OTHER SEGMENT Year Ended December 31, 2021 2020 2019 Net premiums earned (1) Casualty (2) $ 138,551 $ 245,272 $ 246,894 Other specialty (3) 118,356 186,717 185,547 Property catastrophe 15,235 23,037 13,399 Property excluding property catastrophe 6,578 1,130 3,503 Marine and aviation 190 429 — Other (4) 53,058 103,766 107,346 Total $ 331,968 $ 560,351 $ 556,689 Net premiums written by underwriting location (1) United States $ 63,403 $ 115,471 $ 127,176 Europe 91,499 $ 97,753 $ 52,065 Bermuda 199,800 $ 324,365 $ 353,621 Total $ 354,702 $ 537,589 $ 532,862 (1) Other segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions. (2) Includes professional liability, excess motor, programs and other. (3) Includes proportional motor and other. (4) Includes mortgage, US programs and other. |
Reserve for Losses and Loss Adj
Reserve for Losses and Loss Adjustment Expenses | 12 Months Ended |
Dec. 31, 2021 | |
Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract] | |
Reserve for losses and loss adjustment expenses | The following table represents an analysis of losses and loss adjustment expenses and a reconciliation of the beginning and ending reserve for losses and loss adjustment expenses: Year Ended December 31, 2021 2020 2019 Reserve for losses and loss adjustment expenses at beginning of year $ 16,513,929 $ 13,891,842 $ 11,853,297 Unpaid losses and loss adjustment expenses recoverable 4,314,855 4,082,650 2,814,291 Net reserve for losses and loss adjustment expenses at beginning of year 12,199,074 9,809,192 9,039,006 Net incurred losses and loss adjustment expenses relating to losses occurring in: Current year 4,940,987 4,851,051 3,297,037 Prior years (356,184) (161,452) (163,585) Total net incurred losses and loss adjustment expenses 4,584,803 4,689,599 3,133,452 Net losses and loss adjustment expense reserves of acquired business (1) 104,176 — 209,486 Retroactive reinsurance transactions (2) (444,147) 182,210 (225,500) Impact of deconsolidation of Somers (3) (1,460,611) — — Foreign exchange (gains) losses and other 1,181 179,190 36,003 Net paid losses and loss adjustment expenses relating to losses occurring in: Current year (734,846) (661,529) (621,202) Prior years (2,091,705) (1,999,588) (1,762,053) Total net paid losses and loss adjustment expenses (2,826,551) (2,661,117) (2,383,255) Net reserve for losses and loss adjustment expenses at end of year 12,157,925 12,199,074 9,809,192 Unpaid losses and loss adjustment expenses recoverable 5,599,231 4,314,855 4,082,650 Reserve for losses and loss adjustment expenses at end of year $ 17,757,156 $ 16,513,929 $ 13,891,842 ( 1) Represents activity related to the Company’s acquisitions in the 2021 and the 2019 period. See Note 2 . (2) See ‘Retroactive Reinsurance Transactions’ section. (3) See note 12 Development on Prior Year Loss Reserves Year Ended December 31, 2021 During 2021, the Company recorded estimated net favorable development on prior year loss reserves of $356.2 million, which consisted of net favorable development of $16.2 million from the insurance segment, $178.8 million from the reinsurance segment, $169.6 million from the mortgage segment, partially offset by $8.4 million of adverse development from the ‘other’ segment (activity prior to the deconsolidation of Somers). The insurance segment’s net favorable development of $16.2 million, or 0.4 points of net earned premium, consisted of $109.8 million of net favorable development in short-tailed and long-tailed lines mostly offset by $93.5 million of net adverse development from medium-tailed lines. Net favorable development of $81.7 million in short-tailed lines reflected $38.9 million of favorable development from property (excluding marine), primarily from the 2018 to 2020 accident years ( i.e. , the year in which a loss occurred), $26.7 million of favorable development in lenders products, primarily from the 2020 accident year, and $16.2 million of favorable development on travel and accident, primarily from the 2016 to 2020 accident years. Net favorable development of $28.1 million in long-tailed lines reflected favorable development in construction, national accounts and alternative markets, primarily from the 2016 to 2019 accident years, partially offset by adverse development in executive assurance, primarily from the 2015, 2017 and 2018 accident years. Net adverse development in medium-tailed lines reflected $57.6 million of adverse development in contract binding, primarily from the 2013 to 2019 accident years and $30.8 million of adverse development in professional liability, primarily from the 2018 to 2020 accident years. The reinsurance segment’s net favorable development of $178.8 million, or 6.3 points of net earned premium, consisted of $184.1 million of net favorable development from short-tailed and medium-tailed lines, partially offset by $5.3 million of net adverse development from long-tailed lines. Net favorable development of $175.5 million in short-tailed lines reflected $123.3 million from other specialty lines, primarily from the 2014 to 2019 underwriting years ( i.e. , losses attributable to contracts having an inception or renewal date within the given twelve-month period), and $88.6 million of favorable development from property other than property catastrophe business, primarily from the 2015 to 2020 underwriting years. Such amounts were partially offset by adverse development of $36.4 million from property catastrophe, primarily from the 2020 underwriting year. Adverse development in long-tailed lines reflected an increase in casualty reserves, primarily from the 2018 underwriting year. The mortgage segment’s net favorable development of $169.6 million, or 13.2 points of net earned premium. Approximately a third of this development came from the U.S. first lien portfolio, which benefited from improving economic conditions and rising home prices, resulting in reduced claim rate assumptions primarily associated with pre-pandemic delinquencies. Various vintage CRT contracts also experienced similar effects and contributed to the favorable development, including the effect of contracts called by the GSEs. Subrogation recoveries on second lien and student loan business and international business also contributed to the favorable development. Year Ended December 31, 2020 During 2020, the Company recorded estimated net favorable development on prior year loss reserves of $161.5 million, which consisted of net favorable development of $7.8 million from the insurance segment, $134.0 million from the reinsurance segment, $19.0 million from the mortgage segment, and $0.7 million from the ‘other’ segment. The insurance segment’s net favorable development of $7.8 million, or 0.3 points of net earned premium, consisted of $83.0 million of net favorable development in short-tailed and long-tailed lines partially offset by $75.2 million of net adverse development from medium-tailed lines. Net favorable development of $33.6 million in short-tailed lines reflected $21.6 million of favorable development from property (excluding marine), primarily from the 2015 to 2018 accident years, and $8.4 million of favorable development on travel and accident, primarily from the 2019 accident year. Net favorable development of $49.4 million in long-tailed lines included $38.8 million of favorable development related to other business, including alternative markets and excess workers’ compensation, across all accident years, and $9.3 million of favorable development related to construction business. Net adverse development in medium-tailed lines reflected $37.9 million of adverse development in surety business, primarily from the 2019 accident year, $23.1 million in contract binding business, primarily from the 2016 to 2019 accident years, and $16.0 million in program business, primarily from the 2016 to 2019 accident years. The reinsurance segment’s net favorable development of $134.0 million, or 6.2 points of net earned premium, consisted of $155.9 million of net favorable development from short-tailed and medium-tailed lines, partially offset by $21.9 million of net adverse development from long-tailed lines. Net favorable development of $144.0 million in short-tailed lines reflected $87.7 million related to property catastrophe and property other than property catastrophe business, primarily from the 2015 to 2019 underwriting years, and $53.6 million from other specialty lines, across most underwriting years. The net reduction of loss estimates for the reinsurance segment’s short-tailed lines primarily resulted from varying levels of reported and paid claims activity than previously anticipated which led to decreases in certain loss ratio selections during 2020. Adverse development in long-tailed lines reflected an increase in casualty reserves, primarily from the 2012 to 2015 underwriting years. The mortgage segment’s net favorable development of $19.0 million, or 1.4 points of net earned premium, included $16.2 million of favorable development on U.S. primary mortgage insurance business. Such development was primarily driven by subrogation recoveries on second lien business and student loan business. Year Ended December 31, 2019 During 2019, the Company recorded estimated net favorable development on prior year loss reserves of $163.6 million, which consisted of net favorable development of $15.8 million from the insurance segment, $46.4 million from the reinsurance segment and $125.2 million from the mortgage segment, partially offset by $23.8 million of net adverse development from the ‘other’ segment. The insurance segment’s net favorable development of $15.8 million, or 0.7 points of net earned premium, consisted of $54.9 million of net favorable development from short-tailed lines and $39.1 million of net adverse development from medium-tailed and long-tailed lines. Net favorable development in short-tailed lines primarily resulted from lenders products and property (including special risk other than marine) reserves across all accident years, partially offset by net adverse development in travel business, primarily from the 2018 accident year. Net adverse development in medium-tailed and long-tailed lines of $39.1 million was primarily due to net adverse development of $33.6 million in contract binding business, primarily from the 2013 to 2017 accident years, and $30.1 million in programs, primarily from the 2014 and 2018 accident years. Such amounts were partially offset by net favorable development of $19.3 million in professional liability business, primarily from the 2013 to 2016 accident years, and $15.8 million in surety business, primarily from the 2014 to 2016 accident years. The reinsurance segment’s net favorable development of $46.4 million, or 3.2 points of net earned premium, consisted of $70.5 million of net favorable development from short-tailed lines and $16.0 million of net favorable development from medium-tailed lines, partially offset by $40.1 million of net adverse development from long-tailed lines. Favorable development in short-tailed lines included $33.7 million from property catastrophe and property other than property catastrophe reserves, primarily from the 2017 and 2018 underwriting years and $40.8 million in other specialty, primarily from 2016 to 2018 underwriting years. The net reduction of loss estimates for the reinsurance segment’s short-tailed lines primarily resulted from varying levels of reported and paid claims activity than previously anticipated which led to decreases in certain loss ratio selections during 2019. Net favorable development of $16.0 million in medium-tailed lines included reductions in marine and aviation reserves, primarily from the 2011 to 2017 underwriting years. Net adverse development in long-tailed lines of $40.1 million was primarily due to net adverse development of $44.5 million in casualty business, primarily from the 2013 to 2018 underwriting years. The mortgage segment’s net favorable development of $125.2 million, or 9.2 points of net earned premium, included $117.1 million of favorable development on U.S. primary mortgage insurance business. Such development was primarily driven by lower than expected claim rates on first lien business and subrogation recoveries on second lien business. Retroactive Reinsurance Transactions In 2021, the Company entered into a retroactive reinsurance transaction with third party reinsurer to reinsure run-off liabilities associated with certain U.S. insurance exposures. In 2021, the Company entered into a reinsurance to close with the related party, in connection with the 2018 and prior years of account for certain London syndicate business. See Note 16 . In 2020, the Company entered into a reinsurance-to-close agreement related to a third party arrangement covering the 2017 and prior years of account for certain London syndicate business. |
Short Duration Contracts
Short Duration Contracts | 12 Months Ended |
Dec. 31, 2021 | |
Short Duration Contracts Disclosure [Abstract] | |
Short duration contracts | The Company’s reserves for losses and loss adjustment expenses primarily relate to short-duration contracts with various characteristics ( e.g. , type of coverage, geography, claims duration). The Company considered such information in determining the level of disaggregation for disclosures related to its short-duration contracts, as detailed in the table below: Reportable segment Level of disaggregation Included lines of business Insurance Property energy, marine and aviation Property energy, marine and aviation Third party occurrence business Excess and surplus casualty (excluding contract binding); construction and national accounts; and other (including alternative market risks, excess workers’ compensation and employer’s liability insurance coverages) Third party claims-made business Professional lines Multi-line and other specialty Programs; contract binding (part of excess and surplus casualty); travel, accident and health; lenders products; and other (c ontract and commercial surety coverages) Reinsurance Casualty Casualty Property catastrophe Property catastrophe Property excluding property catastrophe Property excluding property catastrophe Marine and aviation Marine and aviation Other specialty Other specialty Mortgage Direct mortgage insurance in the U.S. Mortgage insurance on U.S. primary exposures The Company determined the following to be insignificant for disclosure purposes: (i) certain mortgage business, including non-U.S. primary business, second lien and student loan exposures, global mortgage reinsurance and participation in various GSE credit risk-sharing products, (ii) certain reinsurance business, including casualty clash and non-traditional lines and (iii) amounts associated with Southern Rock Holdings Limited. See Note 2 . Such amounts are included as reconciling items. The Company is required to establish reserves for losses and loss adjustment expenses (“Loss Reserves”) that arise from the business the Company underwrites. Loss Reserves for the insurance, reinsurance and mortgage segments represent estimates of future amounts required to pay losses and loss adjustment expenses for insured or reinsured events which have occurred at or before the balance sheet date. Loss Reserves do not reflect contingency reserve allowances to account for future loss occurrences. Losses arising from future events will be estimated and recognized at the time the losses are incurred and could be substantial. Insurance Segment Loss Reserves for the insurance segment are comprised of estimated amounts for (1) reported losses (“case reserves”) and (2) incurred but not reported losses (“IBNR reserves”). Generally, claims personnel determine whether to establish a case reserve for the estimated amount of the ultimate settlement of individual claims. The estimate reflects the judgment of claims personnel based on general corporate reserving practices, the experience and knowledge of such personnel regarding the nature and value of the specific type of claim and, where appropriate, advice of counsel. The Company also contracts with a number of outside third party administrators in the claims process who, in certain cases, have limited authority to establish case reserves. The work of such administrators is reviewed and monitored by our claims personnel. Loss Reserves are also established to provide for loss adjustment expenses and represent the estimated expense of settling claims, including legal and other fees and the general expenses of administering the claims adjustment process. Periodically, adjustments to the case reserves may be made as additional information is reported or payments are made. IBNR reserves are established to provide for incurred claims which have not yet been reported at the balance sheet date as well as to adjust for any projected variance in case reserving. Actuaries estimate ultimate losses and loss adjustment expenses using various generally accepted actuarial methods applied to known losses and other relevant information. Like case reserves, IBNR reserves are adjusted as additional information becomes known or payments are made. The process of estimating reserves involves a considerable degree of judgment by management and, as of any given date, is inherently uncertain. Ultimate losses and loss adjustment expenses are generally determined by projection of claim emergence and settlement patterns observed in the past that can reasonably be expected to persist into the future. In forecasting ultimate losses and loss adjustment expenses with respect to any line of business, past experience with respect to that line of business is the primary resource, developed through both industry and company experience, but cannot be relied upon in isolation. Uncertainties in estimating ultimate losses and loss adjustment expenses are magnified by the length of the time lag between when a claim actually occurs and when it is reported and settled. This time lag is sometimes referred to as the “claim-tail.” During this period additional facts regarding coverages written in prior accident years, as well as about actual claims and trends, may become known and, as a result, may lead to adjustments of the related Loss Reserves. If the Company determines that an adjustment is appropriate, the adjustment is recorded in the accounting period in which such determination is made. Accordingly, should Loss Reserves need to be increased or decreased in the future from amounts currently established, future results of operations would be negatively or positively impacted respectively. The Company authorizes managing general agents, general agents and other producers to write program business on the Company’s behalf within prescribed underwriting authorities. This delegated authority process introduces additional complexity to the actuarial determination of unpaid future losses and loss adjustment expenses. In order to monitor adherence to the underwriting guidelines given to such parties, the Company periodically performs underwriting and claims due diligence reviews. In determining ultimate losses and loss adjustment expenses, the cost to indemnify claimants, provide needed legal defense and other services for insureds and administer the investigation and adjustment of claims are considered. These claim costs are influenced by many factors that change over time, such as expanded coverage definitions as a result of new court decisions, inflation in costs to repair or replace damaged property, inflation in the cost of medical services and legislated changes in statutory benefits, as well as by the particular, unique facts that pertain to each claim. As a result, the rate at which claims arose in the past and the costs to settle them may not always be representative of what will occur in the future. The factors influencing changes in claim costs are often difficult to isolate or quantify and developments in paid and incurred losses from historical trends are frequently subject to multiple and conflicting interpretations. Changes in coverage terms or claims handling practices may also cause future experience and/or development patterns to vary from the past. A key objective of actuaries in developing estimates of ultimate losses and loss adjustment expenses, and resulting IBNR reserves, is to identify aberrations and systemic changes occurring within historical experience and adjust for them so that the future can be projected more reliably. Because of the factors previously discussed, this process requires the substantial use of informed judgment and is inherently uncertain. Although Loss Reserves are initially determined based on underwriting and pricing analyses, the Company’s insurance segment applies several generally accepted actuarial methods, as discussed below, on a quarterly basis to evaluate the Loss Reserves, in addition to the expected loss method, in particular for Loss Reserves from more mature accident years (the year in which a loss occurred). Each quarter, as part of the reserving process, the segments’ actuaries reaffirm that the assumptions used in the reserving process continue to form a sound basis for the projection of liabilities. If actual loss activity differs substantially from expectations based on historical information, an adjustment to Loss Reserves may be supported. The Company places more or less reliance on a particular actuarial method based on the facts and circumstances at the time the estimates of Loss Reserves are made. These methods generally fall into one of the following categories or are hybrids of one or more of the following categories: • Expected loss methods - these methods are based on the assumption that ultimate losses vary proportionately with premiums. Expected loss and loss adjustment expense ratios are typically developed based upon the information derived by underwriters and actuaries during the initial pricing of the business, supplemented by industry data available from organizations, such as statistical bureaus and consulting firms, where appropriate. These ratios consider, among other things, rate increases and changes in terms and conditions that have been observed in the market. Expected loss methods are useful for estimating ultimate losses and loss adjustment expenses in the early years of long-tailed lines of business, when little or no paid or incurred loss information is available, and is commonly applied when limited loss experience exists for a company. • Historical incurred loss development methods - these methods assume that the ratio of losses in one period to losses in an earlier period will remain constant in the future. These methods use incurred losses ( i.e. , the sum of cumulative historical loss payments plus outstanding case reserves) over discrete periods of time to estimate future losses. Historical incurred loss development methods may be preferable to historical paid loss development methods because they explicitly take into account open cases and the claims adjusters’ evaluations of the cost to settle all known claims. However, historical incurred loss development methods necessarily assume that case reserving practices are consistently applied over time. Therefore, when there have been significant changes in how case reserves are established, using incurred loss data to project ultimate losses may be less reliable than other methods. • Historical paid loss development methods - these methods, like historical incurred loss development methods, assume that the ratio of losses in one period to losses in an earlier period will remain constant. These methods use historical loss payments over discrete periods of time to estimate future losses and necessarily assume that factors that have affected paid losses in the past, such as inflation or the effects of litigation, will remain constant in the future. Because historical paid loss development methods do not use incurred losses to estimate ultimate losses, they may be more reliable than the other methods that use incurred losses in situations where there are significant changes in how incurred losses are established by a company’s claims adjusters. However, historical paid loss development methods are more leveraged (meaning that small changes in payments have a larger impact on estimates of ultimate losses) than actuarial methods that use incurred losses because cumulative loss payments take much longer to equal the expected ultimate losses than cumulative incurred amounts. In addition, and for similar reasons, historical paid loss development methods are often slow to react to situations when new or different factors arise than those that have affected paid losses in the past. • Adjusted historical paid and incurred loss development methods - these methods take traditional historical paid and incurred loss development methods and adjust them for the estimated impact of changes from the past in factors such as inflation, the speed of claim payments or the adequacy of case reserves. Adjusted historical paid and incurred loss development methods are often more reliable methods of predicting ultimate losses in periods of significant change, provided the actuaries can develop methods to reasonably quantify the impact of changes. As such, these methods utilize more judgment than historical paid and incurred loss development methods. • Bornhuetter-Ferguson (“B-F”) paid and incurred loss methods - these methods utilize actual paid and incurred losses and expected patterns of paid and incurred losses, taking the initial expected ultimate losses into account to determine an estimate of expected ultimate losses. The B-F paid and incurred loss methods are useful when there are few reported claims and a relatively less stable pattern of reported losses. • Frequency-Severity methods - These methods utilize actual paid and incurred claim experience, but break the data down into its component pieces: claim counts, often expressed as a ratio to exposure or premium (frequency), and average claim size (severity). The component pieces are projected to an ultimate level and multiplied together to result in an estimate of ultimate loss. These methods are especially useful when the severity of claims can be confined to a relatively stable range of estimated ultimate average claim value. • Additional analyses - other methodologies are often used in the reserving process for specific types of claims or events, such as catastrophic or other specific major events. These include vendor catastrophe models, which are typically used in the estimation of Loss Reserves at the early stage of known catastrophic events before information has been reported to an insurer or reinsurer. In the initial reserving process for short-tail insurance lines (consisting of property, energy, marine and aviation and other exposures including travel, accident and health and lenders products), the Company relies on a combination of the reserving methods discussed above. For catastrophe-exposed business, the reserving process also includes the usage of catastrophe models for known events and a heavy reliance on analysis of individual catastrophic events and management judgment. The development of losses on short-tail business can be unstable, especially for policies characterized by high severity, low frequency losses. As time passes, for a given accident year, additional weight is given to the paid and incurred B-F loss development methods and eventually to the historical paid and incurred loss development methods in the reserving process. The Company makes a number of key assumptions in their reserving process, including that historical paid and reported development patterns are stable, catastrophe models provide useful information about our exposure to catastrophic events that have occurred and underwriters’ judgment as to potential loss exposures can be relied on. The expected loss ratios used in the initial reserving process for short-tail business have varied over time due to changes in pricing, reinsurance structure, estimates of catastrophe losses, policy changes (such as attachment points, class and limits) and geographical distribution. As losses in short-tail lines are reported relatively quickly, expected loss ratios are selected for the current accident year based upon actual attritional loss ratios for earlier accident years, adjusted for rate changes, inflation, changes in reinsurance programs and expected attritional losses based on modeling. Furthermore, ultimate losses for short-tail business are known in a reasonably short period of time. In the initial reserving process for medium-tail and long-tail insurance lines ( consisting of third party occurrence business, third party claims made business, and other exposures including surety, programs and contract binding exposures), the Company primarily relies on the expected loss method. The development of the Company’s medium-tail and long-tail business may be unstable, especially if there are high severity major events, as a portion of the Company’s casualty business is in high excess layers. As time passes, for a given accident year, additional weight is given to the paid and incurred B-F loss development methods and historical paid and incurred loss development methods in the reserving process. The Company makes a number of key assumptions in reserving for medium-tail and long-tail lines, including that the pricing loss ratio is the best estimate of the ultimate loss ratio at the time the policy is entered into, that the loss development patterns, which are based on a combination of company and industry loss development patterns and adjusted to reflect differences in the insurance segment’s mix of business, are reasonable and that claims personnel and underwriters analyses of our exposure to major events are assumed to be the best estimate of exposure to the known claims on those events. The expected loss ratios used in the initial reserving process for medium-tail and long-tail business for recent accident years have varied over time, in some cases significantly, from earlier accident years. As the credibility of historical experience for earlier accident years increases, the experience from these accident years will be given a greater weighting in the actuarial analysis to determine future accident year expected loss ratios, adjusted for changes in pricing, loss trends, terms and conditions and reinsurance structure. In 2021 and 2018, the Company entered into loss portfolio transfer and adverse development cover reinsurance agreements accounted for as retroactive reinsurance. The agreements transfers Loss Reserves and future favorable or adverse development on certain runoff programs and certain third party occurrence business, within multi-line and other specialty business (the “Covered Lines”). As incurred losses and allocated loss adjustment expenses for the Covered Lines are ceded to the reinsurer, the Company is not exposed to changes in the amount, timing and uncertainty of cash flows arising from the Covered Lines. To avoid distortion, the incurred losses and allocated loss adjustment expenses and cumulative paid losses and loss adjustment expenses for the Covered Lines are excluded entirely from the tables below. Unpaid loss and loss adjustment expenses recoverable at December 31, 2021 included $390.1 million related to such reinsurance agreements. The following tables present information on the insurance segment’s short-duration insurance contracts: Property, energy, marine and aviation ($000’s except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 233,149 $ 232,498 $ 205,776 $ 199,469 $ 197,005 $ 192,993 $ 190,770 $ 178,616 $ 178,250 $ 178,343 $ 627 4,245 2013 159,102 156,785 149,199 143,400 134,952 133,869 128,624 127,290 126,276 25 4,243 2014 148,368 145,957 147,465 136,201 132,307 134,329 135,032 134,942 3,098 3,884 2015 112,409 109,865 103,995 102,515 97,852 91,830 91,892 3,804 4,536 2016 104,449 101,306 105,657 100,471 96,437 92,553 874 6,160 2017 280,715 246,291 235,951 230,439 231,228 8,248 6,426 2018 180,981 186,030 173,693 170,057 9,136 5,020 2019 179,056 178,564 165,477 6,667 5,080 2020 359,394 329,362 66,698 4,186 2021 426,870 158,163 2,951 Total $ 1,947,000 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 20,638 $ 93,394 $ 138,977 $ 161,831 $ 167,540 $ 179,945 $ 181,307 $ 173,184 $ 174,032 $ 174,384 2013 32,292 84,936 110,808 120,111 122,244 125,475 123,356 124,688 124,841 2014 25,881 53,751 77,892 84,195 87,812 98,553 115,383 122,296 2015 23,580 64,953 76,338 86,253 87,926 86,246 87,316 2016 24,828 83,552 98,683 97,506 95,002 91,241 2017 30,228 139,867 195,532 211,708 215,895 2018 30,026 102,285 134,858 142,838 2019 26,130 105,380 133,911 2020 55,619 194,487 2021 90,423 Total 1,377,632 All outstanding liabilities before 2012, net of reinsurance 17,517 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 586,885 Third party occurrence business ($000’s except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 241,368 $ 263,451 $ 269,204 $ 272,004 $ 258,371 $ 253,758 $ 243,863 $ 244,448 $ 242,332 $ 239,075 $ 43,924 65,731 2013 283,228 297,225 307,152 302,165 282,122 274,717 272,849 269,754 270,558 54,640 67,113 2014 330,015 336,019 338,890 343,113 339,701 344,197 342,934 343,569 66,498 75,904 2015 359,058 391,884 398,908 392,143 391,455 382,722 386,801 91,081 78,785 2016 389,832 394,485 406,082 399,571 374,896 367,818 115,303 79,005 2017 417,377 417,941 422,624 412,512 407,115 145,130 84,692 2018 430,415 453,190 450,937 451,459 189,965 77,700 2019 456,353 487,547 481,045 253,849 84,895 2020 607,249 616,910 428,750 89,560 2021 622,713 543,386 65,477 Total $ 4,187,063 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 6,984 $ 30,915 $ 58,650 $ 83,637 $ 108,660 $ 130,098 $ 143,885 $ 155,085 $ 163,016 $ 168,119 2013 6,857 29,265 71,449 101,293 122,288 149,292 164,403 174,946 184,800 2014 9,228 40,346 71,624 112,702 162,123 191,305 211,643 224,101 2015 11,139 44,605 88,515 139,492 181,704 211,715 227,697 2016 11,709 41,979 87,616 136,870 164,662 194,773 2017 13,408 52,356 99,874 135,111 165,606 2018 17,025 63,848 115,137 154,248 2019 18,431 73,222 121,859 2020 24,509 76,743 2021 26,301 Total 1,544,247 All outstanding liabilities before 2012, net of reinsurance 242,741 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 2,885,557 Third party claims-made business ($000’s except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 317,654 $ 320,207 $ 318,453 $ 313,907 $ 291,316 $ 275,665 $ 277,683 $ 285,163 $ 285,527 $ 286,118 $ 11,570 15,576 2013 301,956 320,659 324,442 320,524 294,674 291,205 281,996 271,501 273,948 11,739 15,696 2014 264,537 279,846 299,104 279,043 282,058 298,017 292,247 288,318 22,336 15,676 2015 258,989 277,615 276,492 260,063 255,432 252,478 267,925 20,617 14,724 2016 275,394 291,645 308,453 314,747 322,042 327,230 42,509 15,749 2017 271,088 286,565 312,554 308,917 323,854 60,718 16,404 2018 273,521 315,085 320,653 337,083 85,411 15,854 2019 290,217 318,469 318,498 119,673 12,982 2020 384,852 414,580 240,888 10,049 2021 516,420 435,910 8,550 Total $ 3,353,974 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 17,718 $ 69,069 $ 121,211 $ 164,724 $ 190,395 $ 209,295 $ 227,389 $ 251,313 $ 255,337 $ 260,173 2013 19,032 87,458 137,963 179,395 198,008 217,132 238,951 245,687 247,078 2014 13,817 63,312 129,712 173,089 208,074 229,958 243,791 249,960 2015 9,066 52,046 100,089 126,499 174,161 193,186 216,986 2016 10,568 68,226 127,286 158,230 205,596 242,431 2017 9,306 67,669 113,208 143,340 196,125 2018 12,287 68,424 118,361 158,709 2019 12,418 65,477 122,362 2020 17,161 87,547 2021 23,349 Total 1,804,720 All outstanding liabilities before 2012, net of reinsurance 64,171 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 1,613,425 Multi-line and other specialty ($000’s except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 254,684 $ 265,479 $ 259,582 $ 257,240 $ 256,379 $ 248,066 $ 248,310 $ 245,205 $ 245,260 $ 243,849 $ 2,057 55,219 2013 266,089 274,285 265,594 265,672 253,554 254,916 250,252 247,443 246,682 3,461 71,613 2014 303,053 327,098 319,706 319,418 318,297 314,300 311,097 310,097 5,770 109,575 2015 335,250 358,587 357,364 365,362 357,123 349,895 347,669 7,201 148,924 2016 409,367 431,760 428,579 416,724 410,610 408,621 11,032 175,261 2017 483,414 502,068 492,166 501,753 505,135 16,867 219,810 2018 513,466 565,717 563,969 566,283 32,467 247,052 2019 568,337 613,673 641,832 63,880 235,824 2020 622,241 572,265 192,056 149,004 2021 637,258 361,237 75,250 Total $ 4,479,691 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 78,523 $ 166,414 $ 190,754 $ 209,916 $ 223,798 $ 232,640 $ 233,862 $ 237,221 $ 240,191 $ 239,928 2013 86,911 151,897 181,721 214,941 226,769 235,801 237,863 238,792 239,831 2014 108,003 197,609 235,079 267,959 282,104 292,638 294,049 295,551 2015 138,393 236,516 278,265 306,313 321,395 327,082 330,872 2016 176,238 305,250 342,345 363,392 379,885 385,890 2017 181,454 343,049 381,419 424,219 446,749 2018 212,316 390,009 443,644 480,852 2019 212,629 386,894 488,094 2020 173,123 311,112 2021 157,346 Total 3,376,225 All outstanding liabilities before 2012, net of reinsurance 22,375 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 1,125,841 The following table presents the average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance, as of December 31, 2021: Average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Property, energy, marine and aviation 19.3 % 43.5 % 19.1 % 6.6 % 1.4 % 2.3 % 3.2 % 0.5 % 0.3 % 0.2 % Third party occurrence business 3.3 % 9.3 % 11.6 % 11.0 % 9.8 % 8.7 % 5.4 % 4.1 % 3.5 % 2.1 % Third party claims-made business 4.4 % 18.0 % 17.8 % 12.3 % 12.7 % 7.9 % 7.0 % 4.3 % 1.0 % 1.7 % Multi-line and other specialty 34.7 % 29.5 % 11.0 % 8.6 % 4.6 % 2.8 % 0.7 % 0.7 % 0.8 % (0.1) % Reinsurance Segment Loss Reserves for the Company’s reinsurance segment are comprised of (1) case reserves, (2) additional case reserves (“ACRs”) and (3) IBNR reserves. The Company receives reports of claims notices from ceding companies and records case reserves based upon the amount of reserves recommended by the ceding company. Case reserves may be supplemented by ACRs, which may be estimated by the Company’s claims personnel ahead of official notification from the ceding company, or when judgment regarding the size or severity of the known event differs from the ceding company. In certain instances, the Company establishes ACRs even when the ceding company does not report any liability on a known event. In addition, specific claim information reported by ceding companies or obtained through claim audits can alert the Company to emerging trends such as changing legal interpretations of coverage and liability, claims from unexpected sources or classes of business, and significant changes in the frequency or severity of individual claims. Such information is often used in the process of estimating IBNR reserves. IBNR reserves are established to provide for incurred claims which have not yet been reported at the balance sheet date as well as to adjust for any projected variance in case reserving. Actuaries estimate ultimate losses and loss adjustment expenses using various generally accepted actuarial methods applied to known losses and other relevant information. Like case reserves, IBNR reserves are adjusted as additional information becomes known or payments are made. The process of estimating Loss Reserves involves a considerable degree of judgment by management and, as of any given date, is inherently uncertain. The estimation of Loss Reserves for the reinsurance segment is subject to the same risk factors as the estimation of Loss Reserves for the insurance segment. In addition, the inherent uncertainties of estimating such reserves are even greater for reinsurers, due primarily to the following factors: (1) the claim-tail for reinsurers is generally longer because claims are first reported to the ceding company and then to the reinsurer through one or more intermediaries, (2) the reliance on premium estimates, where reports have not been received from the ceding company, in the reserving process, (3) the potential for writing a number of reinsurance contracts with different ceding companies with the same exposure to a single loss event, (4) the diversity of loss development patterns among different types of reinsurance contracts, (5) the necessary reliance on the ceding companies for information regarding reported claims and (6) the differing reserving practices among ceding companies. Ultimate losses and loss adjustment expenses are generally determined by projection of claim emergence and settlement patterns observed in the past that can reasonably be expected to persist into the future. As with the insurance segment, the process of estimating Loss Reserves for the reinsurance segment involves a considerable degree of judgment by management and, as of any given date, is inherently uncertain. As discussed above, such uncertainty is greater for reinsurers compared to insurers. As a result, our reinsurance operations obtain information from numerous sources to assist in the process. Pricing actuaries from the reinsurance segment devote considerable effort to understanding and analyzing a ceding company’s operations and loss history during the underwriting of the business, using a combination of ceding company and industry statistics. Such statistics normally include historical premium and loss data by class of business, individual claim information for larger claims, distributions of insurance limits provided, loss reporting and payment patterns, and rate change history. This analysis is used to project expected loss ratios for each treaty during the upcoming contract period. As mentioned above, there can be a considerable time lag from the time a claim is reported to a ceding company to the time it is reported to the reinsurer. The lag can be several years in some cases and may be attributed to a number of reasons, including the time it takes to investigate a claim, delays associated with the litigation process, the deterioration in a claimant’s physical condition many years after an accident occurs, the case reserving approach of the ceding company, etc. In the reserving process, the Company assumes that such lags are predictable, on average, over time and therefore the lags are contemplated in the loss reporting patterns used in their actuarial methods. This means that the reinsurance segment must rely on estimates for a longer period of time than does an insurance company. Backlogs in the recording of assumed reinsurance can also complicate the accuracy of loss reserve estimation. As of December 31, 2021 there were no significant backlogs related to the processing of assumed reinsurance information at our reinsurance operations. The reinsurance segment relies heavily on information reported by ceding companies, as discussed above. In order to determine the accuracy and completeness of such information, underwriters, actuaries, and claims personnel often perform audits of ceding companies and regularly review information received from ceding companies for unusual or unexpected results. Material findings are usually discussed with the ceding companies. The Company sometimes encounters situations where they determine that a claim presentation from a ceding company is not in accordance with contract terms. In these situations, the Company attempts to resolve the dispute with the ceding company. Most situations are resolved amicably and without the need for litigation or arbitration. However, in the infrequent situations where a resolution is not possible, the Company will vigorously defend its position in such disputes. Although Loss Reserves are initially determined based on underwriting and pricing analysis, the Company applies several generally accepted actuarial methods, as discussed above, on a quarterly basis to evaluate its Loss Reserves in addition to the expected loss method, in particular for reserves from more mature underwriting years (the year in which business is underwritten). Each quarter, as part of the reserving process, the Company’s actuaries reaffirm that the assumptions used in the reserving process continue to form a sound basis for projection of liabilities. If actual loss activity dif |
Allowance for Expected Credit L
Allowance for Expected Credit Losses | 12 Months Ended |
Dec. 31, 2021 | |
Credit Loss [Abstract] | |
Allowance for expected credit losses | Premiums Receivable The following table provides a roll forward of the allowance for expected credit losses of the Company’s premium receivables: Year Ended December 31, 2021 Premium Receivables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 2,064,586 $ 37,781 Change for provision of expected credit losses (2) 2,177 Balance at end of period $ 2,633,280 $ 39,958 Year Ended December 31, 2020 Balance at beginning of period $ 1,778,717 $ 21,003 Cumulative effect of accounting change (1) 6,539 Change for provision of expected credit losses (2) 10,239 Balance at end of period $ 2,064,586 $ 37,781 (1) Adoption of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)”. (2) Amounts deemed uncollectible are written-off in operating expenses. For the 2021 and 2020 periods, amounts written off totaled $3.8 million and $2.8 million, respectively. Reinsurance Recoverables The Company monitors the financial condition of its reinsurers and attempts to place coverages only with substantial, financially sound carriers. Although the Company has not experienced any material credit losses to date, an inability of its reinsurers or retrocessionaires to meet their obligations to it over the relevant exposure periods for any reason could have a material adverse effect on its financial condition and results of operations. The following table provides a roll forward of the allowance for expected credit losses of the Company’s reinsurance recoverables: Year Ended December 31, 2021 Reinsurance Recoverables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 4,500,802 $ 11,636 Change for provision of expected credit losses 1,594 Balance at end of period $ 5,880,735 $ 13,230 Year Ended December 31, 2020 Balance at beginning of period $ 4,346,816 $ 1,364 Cumulative effect of accounting change (1) 12,010 Change for provision of expected credit losses (1,738) Balance at end of period 4,500,802 $ 11,636 (1) Adoption of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)”. The following table summarizes the Company’s reinsurance recoverables on paid and unpaid losses (not including ceded unearned premiums) at December 31, 2021 and 2020: December 31, 2021 2020 Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses $ 5,880,735 $ 4,500,802 % due from carriers with A.M. Best rating of “A-” or better 69.7 % 63.9 % % due from all other rated carriers 0.1 % 0.1 % % due from all other carriers with no A.M. Best rating (1) 30.2 % 36.0 % Largest balance due from any one carrier as % of total shareholders’ equity (2) 6.7 % 1.8 % (1) At December 31, 2021 and 2020 period, over 91% and 94% of such amount is collateralized through reinsurance trusts, funds withheld arrangements, letters of credit or other, respectively. (2) The 2021 period included impact of deconsolidation of Somers. See note 12. Contractholder Receivables The following table provides a roll forward of the allowance for expected credit losses of the Company’s contractholder receivables: Year Ended December 31, 2021 Contractholder Receivables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 1,986,924 $ 8,638 Change for provision of expected credit losses (5,201) Balance at end of period $ 1,828,691 $ 3,437 Year Ended December 31, 2020 Balance at beginning of period $ 2,119,460 $ — Cumulative effect of accounting change (1) 6,663 Change for provision of expected credit losses 1,975 Balance at end of period 1,986,924 $ 8,638 (1) Adoption of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)”. |
Reinsurance
Reinsurance | 12 Months Ended |
Dec. 31, 2021 | |
Reinsurance Disclosures [Abstract] | |
Reinsurance | In the normal course of business, the Company’s insurance subsidiaries cede a portion of their premium through pro rata and excess of loss reinsurance agreements on a treaty or facultative basis. The Company’s reinsurance subsidiaries participate in “common account” retrocessional arrangements for certain pro rata treaties. Such arrangements reduce the effect of individual or aggregate losses to all companies participating on such treaties, including the reinsurers, such as the Company’s reinsurance subsidiaries, and the ceding company. In addition, the Company’s reinsurance subsidiaries may purchase retrocessional coverage as part of their risk management program. The Company’s mortgage subsidiaries cede a portion of their premium through quota share arrangements and enter into various aggregate excess of loss mortgage reinsurance agreements with various special purpose reinsurance companies. Reinsurance recoverables are recorded as assets, predicated on the reinsurers’ ability to meet their obligations under the reinsurance agreements. If the reinsurers are unable to satisfy their obligations under the agreements, the Company’s insurance or reinsurance subsidiaries would be liable for such defaulted amounts. The effects of reinsurance on the Company’s written and earned premiums and losses and loss adjustment expenses with unaffiliated reinsurers were as follows: Year Ended December 31, 2021 2020 2019 Premiums Written Direct $ 7,706,832 $ 6,553,910 $ 5,681,523 Assumed 5,045,655 3,534,158 2,457,437 Ceded (3,734,150) (2,650,352) (2,099,893) Net $ 9,018,337 $ 7,437,716 $ 6,039,067 Premiums Earned Direct $ 7,149,794 $ 6,361,451 $ 5,447,829 Assumed 4,333,873 3,213,873 2,337,950 Ceded (3,401,369) (2,583,389) (1,999,281) Net $ 8,082,298 $ 6,991,935 $ 5,786,498 Losses and Loss Adjustment Expenses Direct $ 4,266,758 $ 4,392,392 $ 2,953,072 Assumed 2,826,820 2,204,323 1,602,528 Ceded (2,508,775) (1,907,116) (1,422,148) Net $ 4,584,803 $ 4,689,599 $ 3,133,452 Bellemeade Re The Company has entered into various aggregate excess of loss mortgage reinsurance agreements with various special purpose reinsurance companies domiciled in Bermuda (the “Bellemeade Agreements”). For the respective coverage periods, the Company will retain the first layer of the respective aggregate losses and the special purpose reinsurance companies will provide second layer coverage up to the outstanding coverage amount. The Company will then retain losses in excess of the outstanding coverage limit. The aggregate excess of loss reinsurance coverage decreases over a ten Note 12, “Variable Interest Entity and Noncontrolling Interests.” The following table summarizes the respective coverages and retentions at December 31, 2021: December 31, 2021 Initial Coverage at Issuance Current Remaining Retention, Net Bellemeade 2017-1 Ltd. (1) $ 368,114 $ 108,368 $ 125,926 Bellemeade 2018-1 Ltd. (2) 374,460 181,136 122,118 Bellemeade 2018-3 Ltd. (3) 506,110 302,563 128,020 Bellemeade 2019-1 Ltd. (4) 341,790 181,324 97,845 Bellemeade 2019-2 Ltd. (5) 621,022 398,316 156,419 Bellemeade 2019-3 Ltd. (6) 700,920 409,859 181,583 Bellemeade 2019-4 Ltd. (7) 577,267 411,954 116,292 Bellemeade 2020-2 Ltd. (8) 449,167 218,877 222,567 Bellemeade 2020-3 Ltd. (9) 451,816 365,141 154,732 Bellemeade 2020-4 Ltd. (10) 337,013 186,065 129,824 Bellemeade 2021-1 Ltd. (11) 643,577 630,163 149,189 Bellemeade 2021-2 Ltd. (12) 616,017 616,017 139,763 Bellemeade 2021-3 Ltd. (13) 639,391 639,391 140,545 Total $ 6,626,664 $ 4,649,174 $ 1,864,823 (1) Issued in October 2017, covering in-force policies issued between January 1, 2017 and June 30, 2017. (2) Issued in April 2018, covering in-force policies issued between July 1, 2017 and December 31, 2017. (3) Issued in October 2018, covering in-force policies issued between January 1, 2018 and June 30, 2018. (4) Issued in March 2019, covering in-force policies primarily issued between 2005 to 2008 under United Guaranty Residential Insurance Company (“UGRIC”); as well as policies issued through 2015 under both UGRIC and Arch Mortgage Insurance Company. (5) Issued in April 2019, covering in-force policies issued between July 1, 2018 and December 31, 2018. (6) Issued in July 2019, covering in-force policies issued in 2016. (7) Issued in October 2019, covering in-force policies issued between January 1, 2019 and June 30, 2019. (8) Issued in September 2020, covering in-force policies issued between January 1, 2020 and May 31, 2020. $423 million was directly funded by Bellemeade 2020-2 Ltd. with an additional $26 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (9) Issued in November 2020, covering in-force policies issued between June 1, 2020 and August 31, 2020. $418 million was directly funded by Bellemeade 2020-3 Ltd. with an additional $34 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (10) Issued in December 2020, covering in-force policies issued between July 1, 2019 and December 31, 2019. $321 million was directly funded by Bellemeade 2020-4 Ltd. with an additional $16 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (11) Issued in March 2021, covering in-force policies issued between September 1, 2020 and November 30, 2020. $580 million was directly funded by Bellemeade Re 2021-1 Ltd. with an additional $64 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (12) Issued in June 2021, covering in-force policies issued between December 1, 2020 and March 31, 2021. $523 million was directly funded by Bellemeade Re 2021-2 Ltd. via insurance-linked notes, with an additional $93 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (13) Issued in September 2021, covering in-force policies issued between April 1, 2021 and June 30, 2021. $508 million was directly funded by Bellemeade Re 2021-3 Ltd. via insurance-linked notes, with an additional $131 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. |
Investment Information
Investment Information | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Investment Information [Abstract] | |
Investment Information | Available For Sale Investments The following table summarizes the fair value and cost or amortized cost of the Company’s securities classified as available for sale: Estimated Gross Unrealized Gains Gross Unrealized Losses Allowance for Expected Credit Losses (2) Cost or December 31, 2021 Fixed maturities: Corporate bonds $ 6,553,333 $ 104,170 $ (69,194) $ (2,037) $ 6,520,394 Mortgage backed securities 408,477 2,825 (5,410) (48) 411,110 Municipal bonds 404,666 18,724 (1,409) (2) 387,353 Commercial mortgage backed securities 1,046,484 1,740 (3,117) (6) 1,047,867 U.S. government and government agencies 4,772,764 10,076 (45,967) — 4,808,655 Non-U.S. government securities 2,120,294 54,048 (34,749) (82) 2,101,077 Asset backed securities 2,692,091 6,540 (11,108) (708) 2,697,367 Total 17,998,109 198,123 (170,954) (2,883) 17,973,823 Short-term investments 1,734,716 568 (590) — 1,734,738 Total $ 19,732,825 $ 198,691 $ (171,544) $ (2,883) $ 19,708,561 December 31, 2020 Fixed maturities (1): Corporate bonds $ 7,856,571 $ 414,247 $ (34,388) $ (896) $ 7,477,608 Mortgage backed securities 630,001 8,939 (5,028) (278) 626,368 Municipal bonds 494,522 27,291 (3,835) (11) 471,077 Commercial mortgage backed securities 389,900 8,722 (2,954) (122) 384,254 U.S. government and government agencies 5,557,077 22,612 (12,611) — 5,547,076 Non-U.S. government securities 2,433,733 153,891 (8,060) — 2,287,902 Asset backed securities 1,634,804 19,225 (10,715) (1,090) 1,627,384 Total 18,996,608 654,927 (77,591) (2,397) 18,421,669 Short-term investments 1,924,922 2,693 (2,063) — 1,924,292 Total $ 20,921,530 $ 657,620 $ (79,654) $ (2,397) $ 20,345,961 (1) In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities pledged. For purposes of this table, the Company has excluded the collateral received under securities lending, at fair value and included the securities pledged under securities lending, at fair value. See “—Securities Lending Agreements.” In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions. (2) Effective January 1, 2020, the Company adopted ASU 2016-13 and as a result any credit impairment losses on the Company’s available-for-sale investments are recorded as an allowance, subject to reversal. The following table summarizes, for all available for sale securities in an unrealized loss position, the fair value and gross unrealized loss by length of time the security has been in a continual unrealized loss position: Less than 12 Months 12 Months or More Total Estimated Fair Gross Unrealized Losses Estimated Fair Gross Unrealized Losses Estimated Fair Gross Unrealized Losses December 31, 2021 Fixed maturities: Corporate bonds $ 3,639,582 $ (63,938) $ 98,867 $ (5,256) $ 3,738,449 $ (69,194) Mortgage backed securities 222,176 (3,545) 46,809 (1,865) 268,985 (5,410) Municipal bonds 26,665 (385) 16,361 (1,024) 43,026 (1,409) Commercial mortgage backed securities 675,603 (2,805) 5,908 (312) 681,511 (3,117) U.S. government and government agencies 4,211,621 (44,180) 33,373 (1,787) 4,244,994 (45,967) Non-U.S. government securities 1,511,301 (31,983) 62,957 (2,766) 1,574,258 (34,749) Asset backed securities 1,667,002 (9,853) 33,082 (1,255) 1,700,084 (11,108) Total 11,953,950 (156,689) 297,357 (14,265) 12,251,307 (170,954) Short-term investments 284,733 (590) — — 284,733 (590) Total $ 12,238,683 $ (157,279) $ 297,357 $ (14,265) $ 12,536,040 $ (171,544) December 31, 2020 Fixed maturities (1): Corporate bonds $ 747,442 $ (33,086) $ 3,934 $ (1,302) $ 751,376 $ (34,388) Mortgage backed securities 284,619 (4,788) 3,637 (240) 288,256 (5,028) Municipal bonds 67,937 (3,835) — — 67,937 (3,835) Commercial mortgage backed securities 126,624 (2,916) 2,655 (38) 129,279 (2,954) U.S. government and government agencies 1,285,907 (12,611) — — 1,285,907 (12,611) Non-U.S. government securities 543,844 (7,658) 2,441 (402) 546,285 (8,060) Asset backed securities 634,470 (9,110) 57,737 (1,605) 692,207 (10,715) Total 3,690,843 (74,004) 70,404 (3,587) 3,761,247 (77,591) Short-term investments 97,920 (2,063) — — 97,920 (2,063) Total $ 3,788,763 $ (76,067) $ 70,404 $ (3,587) $ 3,859,167 $ (79,654) (1) In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities pledged. For purposes of this table, the Company has excluded the collateral received and reinvested and included the fixed maturities pledged. See “—Securities Lending Agreements.” In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions. At December 31, 2021, on a lot level basis, approximately 4,700 security lots out of a total of approximately 10,240 security lots were in an unrealized loss position and the largest single unrealized loss from a single lot in the Company’s fixed maturity portfolio was $1.1 million. The Company believes that such securities were temporarily impaired at December 31, 2021. At December 31, 2020, on a lot level basis, approximately 2,320 security lots out of a total of approximately 11,180 security lots were in an unrealized loss position and the largest single unrealized loss from a single lot in the Company’s fixed maturity portfolio was $0.9 million. The contractual maturities of the Company’s fixed maturities and fixed maturities pledged under securities lending agreements are shown in the following table. Expected maturities, which are management’s best estimates, will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. December 31, 2021 December 31, 2020 Maturity Estimated Fair Value Amortized Cost Estimated Fair Value Amortized Cost Due in one year or less $ 300,889 $ 299,772 $ 348,200 $ 339,951 Due after one year through five years 8,355,255 8,339,387 10,629,959 10,340,819 Due after five years through 10 years 4,689,155 4,684,393 4,881,564 4,654,754 Due after 10 years 505,758 493,927 482,180 448,139 13,851,057 13,817,479 16,341,903 15,783,663 Mortgage backed securities 408,477 411,110 630,001 626,368 Commercial mortgage backed securities 1,046,484 1,047,867 389,900 384,254 Asset backed securities 2,692,091 2,697,367 1,634,804 1,627,384 Total (1) $ 17,998,109 $ 17,973,823 $ 18,996,608 $ 18,421,669 (1) In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities pledged. For purposes of this table, the Company has excluded the collateral received and reinvested and included the fixed maturities pledged. See “—Securities Lending Agreements.” In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions. Securities Lending Agreements In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions to enhance investment income. Prior to the termination of this program, the Company loaned certain of its securities to third parties, primarily major brokerage firms, for short periods of time through a lending agent. The Company maintained legal control over the securities it lent (shown as ‘Securities pledged under securities lending, at fair value’ on the Company’s balance sheet), retained the earnings and cash flows associated with the loaned securities and received a fee from the borrower for the temporary use of the securities. An indemnification agreement with the lending agent protected the Company in the event a borrower became insolvent or failed to return any of the securities on loan from the Company. The Company receives collateral (shown as ‘Collateral received under securities lending, at fair value’ on the Company’s balance sheet) in the form of cash or U.S. government and government agency securities. At December 31, 2021, the Company had no cash collateral or security collateral due to the termination of the program. At December 31, 2020, the fair value of the cash collateral received on securities lending was nil and the fair value of security collateral received was $301.1 million. The carrying value of collateral held under the Company’s securities lending transactions by significant investment category and remaining contractual maturity of the underlying agreements was as follows at December 31, 2020 (no balances at December 31, 2021 due to the termination of the program): Remaining Contractual Maturity of the Agreements Overnight and Continuous Less than 30 Days 30-90 Days 90 Days or More Total December 31, 2020 U.S. government and government agencies $ 142,317 $ — $ 139,290 $ — $ 281,607 Corporate bonds 3,021 — — — 3,021 Equity securities 16,461 — — — 16,461 Total $ 161,799 $ — $ 139,290 $ — $ 301,089 Gross amount of recognized liabilities for securities lending in offsetting disclosure in Note 11 — Amounts related to securities lending not included in offsetting disclosure in Note 11 $ 301,089 Equity Securities, at Fair Value At December 31, 2021, the Company held $1.8 billion of equity securities, at fair value, compared to $1.4 billion at December 31, 2020. Net Investment Income The components of net investment income were derived from the following sources: Year Ended December 31, 2021 2020 2019 Fixed maturities $ 330,061 $ 412,481 $ 505,399 Term loans 34,843 84,149 98,949 Equity securities 42,396 28,958 15,857 Short-term investments 6,928 10,840 15,820 Other (1) 62,895 72,395 80,618 Gross investment income 477,123 608,823 716,643 Investment expenses (88,005) (89,215) (88,905) Net investment income $ 389,118 $ 519,608 $ 627,738 (1) Includes income distributions from investment funds and other items Net Realized Gains (Losses) Net realized gains (losses) were as follows: Year Ended December 31, 2021 2020 2019 Available for sale securities: Gross gains on investment sales $ 313,886 $ 595,941 $ 235,655 Gross losses on investment sales (156,791) (117,282) (104,612) Change in fair value of assets and liabilities accounted for using the fair value option: Fixed maturities 7,953 15,881 41,910 Other investments 116,781 13,656 (35,734) Equity securities 13,028 14,629 15,869 Short-term investments 601 2,279 3,801 Equity securities, at fair value : Net realized gains (losses) on securities sold 122,606 26,849 11,313 Net unrealized gains (losses) on equity securities still held at reporting date 48,746 102,394 97,768 Allowance for credit losses: Investments related (2,100) (3,597) — Underwriting related 1,062 (10,007) — Net impairment losses — (533) (3,165) Derivative instruments (1) (32,390) 179,675 119,741 Other (2) (53,537) 3,575 (19,348) Net realized gains (losses) $ 379,845 $ 823,460 $ 363,198 (1) See Note 11 for information on the Company’s derivative instruments. (2) 2021 periods reflected $33.1 million of losses related to the Company’s deconsolidation of Somers. Other Investments The following table summarizes the Company’s other investments and other investable assets: December 31, 2021 2020 Fixed maturities $ 416,698 $ 843,354 Other investments 1,432,553 2,331,885 Short-term investments 97,806 557,008 Equity securities 26,493 92,549 Investments accounted for using the fair value option 1,973,550 3,824,796 Other investable assets (1) — 500,000 Total other investments $ 1,973,550 $ 4,324,796 (1) Participation interests in a receivable of a reverse repurchase agreement. The following table summarizes the Company’s other investments, as detailed in the previous table, by strategy: December 31, 2021 2020 Lending 536,345 572,636 Term loan investments 484,950 1,231,731 Investment grade fixed income 147,810 138,646 Private equity 91,126 48,750 Energy 81,692 65,813 Credit related funds 70,278 90,780 Infrastructure 20,352 165,516 Real estate — 18,013 Total $ 1,432,553 $ 2,331,885 Investments Accounted For Using the Equity Method The following table summarizes the Company’s investments accounted for using the equity method, by strategy: December 31, 2021 2020 Credit related funds $ 1,022,334 $ 740,060 Private equity 436,042 235,289 Real estate 396,395 258,518 Equities 395,090 343,058 Lending 376,649 179,629 Infrastructure 230,070 175,882 Energy 119,141 115,453 Fixed income 101,890 — Total $ 3,077,611 $ 2,047,889 In applying the equity method, investments are initially recorded at cost and are subsequently adjusted based on the Company’s proportionate share of the net income or loss of the funds (which include changes in the fair value of the underlying securities in the funds). Such investments are generally recorded on a one three Equity in Net Income (Loss) of Investments Accounted For Using the Equity Method The Company recorded equity in net income related to investments accounted for using the equity method of $366.4 million for 2021, compared to $146.7 million for 2020 and $123.7 million for 2019. In applying the equity method, investments are initially recorded at cost and are subsequently adjusted based on the Company’s proportionate share of the net income or loss of the funds (which include changes in the market value of the underlying securities in the funds). A summary of financial information for the Company’s investment funds and operating affiliates accounted for using the equity method is as follows: December 31, 2021 2020 Invested assets $ 58,508,009 $ 44,131,377 Total assets 69,648,905 49,078,464 Total liabilities 17,944,325 6,054,189 Net assets $ 51,704,580 $ 43,024,275 Year Ended December 31, 2021 2020 2019 Total revenues $ 11,785,949 $ 5,762,098 $ 164,669 Total expenses 3,238,606 1,656,029 528,762 Net income (loss) $ 8,547,343 $ 4,106,069 $ (364,093) Certain of the Company’s other investments and investments accounted for using the equity method are in investment funds for which the Company has the option to redeem at agreed upon values as described in each investment fund’s subscription agreement. Depending on the terms of the various subscription agreements, investments in investment funds may be redeemed daily, monthly, quarterly or on other terms. Two common redemption restrictions which may impact the Company’s ability to redeem these investment funds are gates and lockups. A gate is a suspension of redemptions which may be implemented by the general partner or investment manager of the fund in order to defer, in whole or in part, the redemption request in the event the aggregate amount of redemption requests exceeds a predetermined percentage of the investment fund's net assets which may otherwise hinder the general partner or investment manager's ability to liquidate holdings in an orderly fashion in order to generate the cash necessary to fund extraordinarily large redemption payouts. A lockup period is the initial amount of time an investor is contractually required to hold the security before having the ability to redeem. If the investment funds are eligible to be redeemed, the time to redeem such fund can take weeks or months following the notification. Limited Partnership Interests In the normal course of its activities, the Company invests in limited partnerships as part of its overall investment strategy. Such amounts are included in ‘investments accounted for using the equity method’ and ‘investments accounted for using the fair value option.’ The Company determined that these limited partnership interests represented variable interests in the funds because the general partner did not have a significant interest in the funds. The Company’s maximum exposure to loss with respect to these investments is limited to the investment carrying amounts reported in the Company’s consolidated balance sheet and any unfunded commitment. The following table summarizes investments in limited partnership interests where the Company has a variable interest by balance sheet item: December 31, 2021 2020 Investments accounted for using the equity method (1) $ 3,077,611 $ 2,047,889 Investments accounted for using the fair value option (2) 170,595 184,720 Total $ 3,248,206 $ 2,232,609 (1) Aggregate unfunded commitments were $2.6 billion at December 31, 2021, compared to $1.8 billion at December 31, 2020. (2) Aggregate unfunded commitments were $18.8 million at December 31, 2021, compared to $35.6 million at December 31, 2020. Investments in Operating Affiliates Investments in which the Company has significant influence over the operating and financial policies are classified as ‘investments in operating affiliates’ on the Company’s balance sheets and are accounted for under the equity method. Such investments primarily include the Company’s investment in Coface SA (“Coface”), Greysbridge and Premia. Investments in Coface and Premia are generally recorded on a three In 2021, the Company completed the share purchase agreement with Natixis to purchase 29.5% of the common equity of Coface, a France-based leader in the global trade credit insurance market. The consideration paid was €9.95 per share, or an aggregate €453 million (approximately $546 million) including related fees. Income (loss) from operating affiliates reflected a one-time gain of $74.5 million realized from the acquisition. As a result of equity method accounting rules, approximately $36 million of additional gain was deferred and will generally be recognized over the next five years. As of December 31, 2021, the Company owned approximately 29.86% of the issued shares of Coface, or 30.10% excluding treasury shares, with a carrying value of $630.5 million. In July 2021, the Company announced the completion of the previously disclosed acquisition of Somers by Greysbridge for a cash purchase price of $35.00 per common share. Effective July 1, 2021, Somers is wholly owned by Greysbridge, and Greysbridge is owned 40% by the Company, 30% by certain investment funds managed by Kelso and 30% by certain investment funds managed by Warburg. At December 31, 2021 the Company’s carrying value in Greysbridge was $375.7 million, which reflected the Company’s aggregate purchase price of $278.9 million along with income (loss) from operating affiliates, which included a one-time gain of $95.7 million recognized from the acquisition. In addition, the ‘net realized gains (losses)’ line on the Company’s consolidated statements of income included a $33.1 million loss as a result of deconsolidation of Somers in the Company’s financial statements following the close of the transaction. See note 12 . The Company recorded income from operating affiliates of $264.7 million for 2021, compared to income of $16.8 million for 2020 and $2.2 million for 2019. The income from operating affiliates for the 2021 period, primarily related to the Company’s recent investments in Coface and Greysbridge. Allowance for Expected Credit Losses The following table provides a roll forward of the allowance for expected credit losses of the Company’s securities classified as available for sale: Year Ended December 31, 2021 Structured Securities (1) Municipal Corporate Total Balance at beginning of period $ 1,490 $ 11 $ 896 $ 2,397 Additions for current-period provision for expected credit losses 602 — 2,858 3,460 Additions (reductions) for previously recognized expected credit losses (847) (9) (320) (1,176) Reductions due to disposals (3) (443) — (1,355) (1,798) Balance at end of period $ 802 $ 2 $ 2,079 $ 2,883 Year Ended December 31, 2020 Balance at beginning of period $ — $ — $ — $ — Cumulative effect of accounting change (2) 517 — 117 634 Additions for current-period provision for expected credit losses 2,942 67 7,644 10,653 Additions (reductions) for previously recognized expected credit losses (1,398) 6 (5,638) (7,030) Reductions due to disposals (571) (62) (1,227) (1,860) Balance at end of period $ 1,490 $ 11 $ 896 $ 2,397 (1) Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities. (2) Adoption of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)”. (3) Reduction for the 2021 periods primarily related to the Company’s deconsolidation of Somers. The Company is required to maintain assets on deposit, which primarily consist of fixed maturities, with various regulatory authorities to support its underwriting operations. The Company’s subsidiaries maintain assets in trust accounts as collateral for transactions with affiliated companies and also have investments in segregated portfolios primarily to provide collateral or guarantees for letters of credit to third parties The following table details the value of the Company’s restricted assets: December 31, 2021 2020 Assets used for collateral or guarantees: Affiliated transactions $ 4,223,955 $ 4,643,334 Third party agreements 2,721,160 3,083,324 Deposits with U.S. regulatory authorities 798,100 827,552 Deposits with non-U.S. regulatory authorities 506,517 179,099 Total restricted assets (1) $ 8,249,732 $ 8,733,309 (1) 2020 balances included $1.036 billion related to Somers. See note 12 . Reconciliation of Cash and Restricted Cash The following table details reconciliation of cash and restricted cash within the Consolidated Balance Sheets: December 31, 2021 2020 2019 Cash $ 858,668 $ 906,448 $ 726,230 Restricted cash (included in ‘other assets’) 456,103 384,096 177,468 Cash and restricted cash $ 1,314,771 $ 1,290,544 $ 903,698 |
Fair Value
Fair Value | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Accounting guidance regarding fair value measurements addresses how companies should measure fair value when they are required to use a fair value measure for recognition or disclosure purposes under GAAP and provides a common definition of fair value to be used throughout GAAP. It defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly fashion between market participants at the measurement date. In addition, it establishes a three-level valuation hierarchy for the disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The level in the hierarchy within which a given fair value measurement falls is determined based on the lowest level input that is significant to the measurement (Level 1 being the highest priority and Level 3 being the lowest priority). The levels in the hierarchy are defined as follows: Level 1: Inputs to the valuation methodology are observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets Level 2: Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument Level 3: Inputs to the valuation methodology are unobservable and significant to the fair value measurement Following is a description of the valuation methodologies used for securities measured at fair value, as well as the general classification of such securities pursuant to the valuation hierarchy. The Company reviews its securities measured at fair value and discusses the proper classification of such investments with investment advisers and others. The Company determines the existence of an active market based on its judgment as to whether transactions for the financial instrument occur in such market with sufficient frequency and volume to provide reliable pricing information. The independent pricing sources obtain market quotations and actual transaction prices for securities that have quoted prices in active markets. The Company uses quoted values and other data provided by nationally recognized independent pricing sources as inputs into its process for determining fair values of its fixed maturity investments. To validate the techniques or models used by pricing sources, the Company's review process includes, but is not limited to: (i) quantitative analysis ( e.g. , comparing the quarterly return for each managed portfolio to its target benchmark, with significant differences identified and investigated); (ii) a review of the prices obtained in the pricing process and the range of resulting fair values; (iii) initial and ongoing evaluation of methodologies used by outside parties to calculate fair value; (iv) a comparison of the fair value estimates to the Company’s knowledge of the current market; (v) a comparison of the pricing services' fair values to other pricing services' fair values for the same investments; and (vi) periodic back-testing, which includes randomly selecting purchased or sold securities and comparing the executed prices to the fair value estimates from the pricing service. A price source hierarchy was maintained in order to determine which price source would be used ( i.e. , a price obtained from a pricing service with more seniority in the hierarchy will be used over a less senior one in all cases). The hierarchy prioritizes pricing services based on availability and reliability and assigns the highest priority to index providers. Based on the above review, the Company will challenge any prices for a security or portfolio which are considered not to be representative of fair value. In certain circumstances, when fair values are unavailable from these independent pricing sources, quotes are obtained directly from broker-dealers who are active in the corresponding markets. Such quotes are subject to the validation procedures noted above. Of the $23.8 billion of financial assets and liabilities measured at fair value at December 31, 2021, approximately $7.7 million, or 0.0%, were priced using non-binding broker-dealer quotes. Of the $26.5 billion of financial assets and liabilities measured at fair value at December 31, 2020, approximately $150.1 million, or 0.6%, were priced using non-binding broker-dealer quotes. Fixed maturities The Company uses the market approach valuation technique to estimate the fair value of its fixed maturity securities, when possible. The market approach includes obtaining prices from independent pricing services, such as index providers and pricing vendors, as well as to a lesser extent quotes from broker-dealers. The independent pricing sources obtain market quotations and actual transaction prices for securities that have quoted prices in active markets. Each source has its own proprietary method for determining the fair value of securities that are not actively traded. In general, these methods involve the use of “matrix pricing” in which the independent pricing source uses observable market inputs including, but not limited to, investment yields, credit risks and spreads, benchmarking of like securities, broker-dealer quotes, reported trades and sector groupings to determine a reasonable fair value. The following describes the significant inputs generally used to determine the fair value of the Company’s fixed maturity securities by asset class: U.S. government and government agencies – valuations provided by independent pricing services, with all prices provided through index providers and pricing vendors. The Company determined that all U.S. Treasuries would be classified as Level 1 securities due to observed levels of trading activity, the high number of strongly correlated pricing quotes received on U.S. Treasuries and other factors. The fair values of U.S. government agency securities are generally determined using the spread above the risk-free yield curve. As the yields for the risk-free yield curve and the spreads for these securities are observable market inputs, the fair values of U.S. government agency securities are classified within Level 2. Corporate bonds – valuations provided by independent pricing services, substantially all through index providers and pricing vendors with a small amount through broker-dealers. The fair values of these securities are generally determined using the spread above the risk-free yield curve. These spreads are generally obtained from the new issue market, secondary trading and from broker-dealers who trade in the relevant security market. As the significant inputs used in the pricing process for corporate bonds are observable market inputs, the fair value of these securities are classified within Level 2. Mortgage-backed securities – valuations provided by independent pricing services, substantially all through pricing vendors and index providers with a small amount through broker-dealers. The fair values of these securities are generally determined through the use of pricing models (including Option Adjusted Spread) which use spreads to determine the expected average life of the securities. These spreads are generally obtained from the new issue market, secondary trading and from broker-dealers who trade in the relevant security market. The pricing services also review prepayment speeds and other indicators, when applicable. As the significant inputs used in the pricing process for mortgage-backed securities are observable market inputs, the fair value of these securities are classified within Level 2. Municipal bonds – valuations provided by independent pricing services, with all prices provided through index providers and pricing vendors. The fair values of these securities are generally determined using spreads obtained from broker-dealers who trade in the relevant security market, trade prices and the new issue market. As the significant inputs used in the pricing process for municipal bonds are observable market inputs, the fair value of these securities are classified within Level 2. Commercial mortgage-backed securities – valuations provided by independent pricing services, substantially all through index providers and pricing vendors with a small amount through broker-dealers. The fair values of these securities are generally determined through the use of pricing models which use spreads to determine the appropriate average life of the securities. These spreads are generally obtained from the new issue market, secondary trading and from broker-dealers who trade in the relevant security market. As the significant inputs used in the pricing process for commercial mortgage-backed securities are observable market inputs, the fair value of these securities are classified within Level 2. Non-U.S. government securities – valuations provided by independent pricing services, with all prices provided through index providers and pricing vendors. The fair values of these securities are generally based on international indices or valuation models which include daily observed yield curves, cross-currency basis index spreads and country credit spreads. As the significant inputs used in the pricing process for non-U.S. government securities are observable market inputs, the fair value of these securities are classified within Level 2. Asset-backed securities – valuations provided by independent pricing services, substantially all through index providers and pricing vendors with a small amount through broker-dealers. The fair values of these securities are generally determined through the use of pricing models (including Option Adjusted Spread) which use spreads to determine the appropriate average life of the securities. These spreads are generally obtained from the new issue market, secondary trading and from broker-dealers who trade in the relevant security market. As the significant inputs used in the pricing process for asset-backed securities are observable market inputs, the fair value of these securities are classified within Level 2. A small number of securities are included in Level 3 due to a low level of transparency on the inputs used in the pricing process. Equity securities The Company determined that exchange-traded equity securities would be included in Level 1 as their fair values are based on quoted market prices in active markets. Other equity securities are included in Level 2 of the valuation hierarchy. A small number of securities are included in Level 3 due to the lack of an available independent price source for such securities. As the significant inputs used to price these securities are unobservable, the fair value of such securities are classified as Level 3. Other investments The Company determined that exchange-traded investments would be included in Level 1 as their fair values are based on quoted market prices in active markets. Other investments also include term loan investments for which fair values are estimated by using quoted prices of term loan investments with similar characteristics, pricing models or matrix pricing. Such investments are generally classified within Level 2. A small number of securities are included in Level 3 due to the lack of an available independent price source for such securities. Derivative instruments The Company’s futures contracts, foreign currency forward contracts, interest rate swaps and other derivatives trade in the over-the-counter derivative market. The Company uses the market approach valuation technique to estimate the fair value for these derivatives based on significant observable market inputs from third party pricing vendors, non-binding broker-dealer quotes and/or recent trading activity. As the significant inputs used in the pricing process for these derivative instruments are observable market inputs, the fair value of these securities are classified within Level 2. Short-term investments The Company determined that certain of its short-term investments held in highly liquid money market-type funds, Treasury bills and commercial paper would be included in Level 1 as their fair values are based on quoted market prices in active markets. The fair values of other short-term investments are generally determined using the spread above the risk-free yield curve and are classified within Level 2. Residential mortgage loans The Company’s residential mortgage loans (included in ‘other assets’ in the consolidated balance sheets) include amounts related to the Company’s whole mortgage loan purchase and sell program. Fair values of residential mortgage loans are generally determined based on market prices. As significant inputs used in pricing process for these residential mortgage loans are observable market inputs, the fair value of these securities are classified within Level 2. Contingent consideration liabilities Contingent consideration liabilities (included in ‘other liabilities’ in the consolidated balance sheets) include amounts related to the Company’s acquisitions. Such amounts are remeasured at fair value at each balance sheet date with changes in fair value recognized in ‘net realized gains (losses).’ To determine the fair value of contingent consideration liabilities, the Company estimates future payments using an income approach based on modeled inputs which include a weighted average cost of capital. The Company determined that contingent consideration liabilities would be included within Level 3. The following table presents the Company’s financial assets and liabilities measured at fair value by level at December 31, 2021: Fair Value Measurement Using: Estimated Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Assets measured at fair value: Available for sale securities: Fixed maturities: Corporate bonds $ 6,553,333 $ — $ 6,553,320 $ 13 Mortgage backed securities 408,477 — 408,477 — Municipal bonds 404,666 — 404,666 — Commercial mortgage backed securities 1,046,484 — 1,046,484 — U.S. government and government agencies 4,772,764 4,744,517 28,247 — Non-U.S. government securities 2,120,294 — 2,120,294 — Asset backed securities 2,692,091 — 2,688,744 3,347 Total 17,998,109 4,744,517 13,250,232 3,360 Short-term investments 1,734,716 1,052,822 681,894 — Equity securities, at fair value 1,804,170 1,762,864 38,388 2,918 Derivative instruments (3) 127,121 — 127,121 — Residential mortgage loans 49,847 — 49,847 — Fair value option: Corporate bonds 388,546 — 388,546 — Non-U.S. government bonds 23,785 — 23,785 — Asset backed securities 4,367 — 4,367 — Short-term investments 97,806 528 97,278 — Equity securities 26,493 21,745 — 4,748 Other investments 310,798 20,352 262,465 27,981 Other investments measured at net asset value (1) 1,121,755 Total 1,973,550 42,625 776,441 32,729 Total assets measured at fair value $ 23,687,513 $ 7,602,828 $ 14,923,923 $ 39,007 Liabilities measured at fair value: Contingent consideration liabilities $ (16,960) $ — $ — $ (16,960) Securities sold but not yet purchased (2) — — — — Derivative instruments (3) (54,224) — (54,224) — Total liabilities measured at fair value $ (71,184) $ — $ (54,224) $ (16,960) (1) In accordance with applicable accounting guidance, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets. (2) Represents the Company’s obligations to deliver securities that it did not own at the time of sale. Such amounts are included in “other liabilities” on the Company’s consolidated balance sheets. (3) See Note 11. The following table presents the Company’s financial assets and liabilities measured at fair value by level at December 31, 2020: Fair Value Measurement Using: Estimated Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Assets measured at fair value (1): Available for sale securities: Fixed maturities: Corporate bonds $ 7,856,571 $ — $ 7,856,558 $ 13 Mortgage backed securities 630,001 — 630,001 — Municipal bonds 494,522 — 494,522 — Commercial mortgage backed securities 389,900 — 389,900 — U.S. government and government agencies 5,557,077 5,463,356 93,721 — Non-U.S. government securities 2,433,733 — 2,433,733 — Asset backed securities 1,634,804 — 1,631,378 3,426 Total 18,996,608 5,463,356 13,529,813 3,439 Equity securities, at fair value 1,460,959 1,401,653 17,291 42,015 Short-term investments 1,924,922 1,920,565 4,357 — Derivative instruments (4) 177,383 — 177,383 — Fair value option: Corporate bonds 651,294 — 650,309 985 Non-U.S. government bonds 35,263 — 35,263 — Mortgage backed securities 3,282 — 3,282 — Commercial mortgage backed securities 1,090 — 1,090 — Asset backed securities 152,151 — 152,151 — U.S. government and government agencies 274 164 110 — Short-term investments 557,008 420,131 136,877 — Equity securities 92,549 23,373 188 68,988 Other investments 1,134,229 51,149 1,015,977 67,103 Other investments measured at net asset value (2) 1,197,656 Total 3,824,796 494,817 1,995,247 137,076 Total assets measured at fair value $ 26,384,668 $ 9,280,391 $ 15,724,091 $ 182,530 Liabilities measured at fair value: Contingent consideration liabilities $ (461) $ — $ — $ (461) Securities sold but not yet purchased (3) (21,679) — (21,679) — Derivative instruments (4) (108,705) — (108,705) — Total liabilities measured at fair value $ (130,845) $ — $ (130,384) $ (461) (1) In securities lending transactions, the Company receives collateral in excess of the fair value of the securities pledged. For purposes of this table, the Company has excluded the collateral received under securities lending, at fair value and included the securities pledged under securities lending, at fair value. See Note 9. (2) In accordance with applicable accounting guidance, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets. (3) Represents the Company’s obligations to deliver securities that it did not own at the time of sale. Such amounts are included in “other liabilities” on the Company’s consolidated balance sheets. (4) See Note 11. The following table presents a reconciliation of the beginning and ending balances for all financial assets and liabilities measured at fair value on a recurring basis using Level 3 inputs for 2021 and 2020: Assets Liabilities Available For Sale Fair Value Option Fair Value Structured Securities (1) Corporate Bonds Corporate Bonds Other Investments Equity Securities Equity Securities Contingent Year Ended December 31, 2021 Balance at beginning of year $ 3,426 $ 13 $ 985 $ 67,103 $ 68,988 $ 42,015 $ (461) Total gains or (losses) (realized/unrealized) Included in earnings (2) (135) — 13 868 4,941 1,958 — Included in other comprehensive income 133 — — — — — — Purchases, issuances, sales and settlements Purchases — — — 13,213 — 5,718 (16,494) Issuances — — — — — — — Sales (3) — — (998) (53,203) (69,181) (46,773) — Settlements (77) — — — — — (5) Transfers in and/or out of Level 3 — — — — — — — Balance at end of year $ 3,347 $ 13 $ — $ 27,981 $ 4,748 $ 2,918 $ (16,960) Year Ended December 31, 2020 Balance at beginning of year $ 5,216 $ 8,851 $ 932 $ 68,817 $ 58,094 $ 55,889 $ (7,998) Total gains or (losses) (realized/unrealized) Included in earnings (2) — (5,865) (13) (314) 10,894 8,214 (72) Included in other comprehensive income (169) 397 — — — — — Purchases, issuances, sales and settlements Purchases — — 66 52,449 — 4,030 — Issuances — — — — — — — Sales — — — (56,833) — (26,118) — Settlements (1,413) (1,462) — — — — 7,609 Transfers in and/or out of Level 3 (208) (1,908) — 2,984 — — — Balance at end of year $ 3,426 $ 13 $ 985 $ 67,103 $ 68,988 $ 42,015 $ (461) (1) Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities. (2) Gains or losses were included in net realized gains (losses). (3) Sales for the 2021 period primarily relates to the Company’s deconsolidation of Somers. Financial Instruments Disclosed, But Not Carried, At Fair Value The Company uses various financial instruments in the normal course of its business. The carrying values of cash, accrued investment income, receivable for securities sold, certain other assets, payable for securities purchased and certain other liabilities approximated their fair values at December 31, 2021, due to their respective short maturities. As these financial instruments are not actively traded, their respective fair values are classified within Level 2. At December 31, 2021, the Company’s senior notes were carried at their cost, net of debt issuance costs, of $2.7 billion and had a fair value of $3.3 billion. At December 31, 2020, the Company’s senior notes were carried at their cost, net of debt issuance costs, of $2.9 billion and had a fair value of $3.7 billion. The fair values of the senior notes were obtained from a third party pricing service and are based on observable market inputs. As such, the fair value of the senior notes is classified within Level 2. Fair Value Measurements on a Non-Recurring Basis The Company measures the fair value of certain assets on a non-recurring basis, generally quarterly, annually, or when events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. These assets include investments accounted for using the equity method, certain other investments, goodwill and intangible assets, and long-lived assets. The Company uses a variety of techniques to measure the fair value of these assets when appropriate, as described below: Investments accounted for using the equity method. When the Company determines that the carrying value of these assets may not be recoverable, the Company records the assets at fair value with the loss recognized in income. In such cases, the Company measures the fair value of these assets using the techniques discussed above in “—Fair Value Measurements on a Recurring Basis.” Goodwill and Intangible Assets . The Company tests goodwill and intangible assets annually for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable. When the Company determines goodwill and intangible assets may be impaired, the Company uses techniques including discounted expected future cash flows, to measure fair value. |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | The Company’s investment strategy allows for the use of derivative instruments. The Company’s derivative instruments are recorded on its consolidated balance sheets at fair value. The Company utilizes exchange traded U.S. Treasury note, Eurodollar and other futures contracts and commodity futures to manage portfolio duration or replicate investment positions in its portfolios and the Company routinely utilizes foreign currency forward contracts, currency options, index futures contracts and other derivatives as part of its total return objective. In addition, certain of the Company’s investments are managed in portfolios which incorporate the use of foreign currency forward contracts which are intended to provide an economic hedge against foreign currency movements. In addition, the Company purchases to-be-announced mortgage backed securities (“TBAs”) as part of its investment strategy. TBAs represent commitments to purchase a future issuance of agency mortgage backed securities. For the period between purchase of a TBA and issuance of the underlying security, the Company’s position is accounted for as a derivative. The Company purchases TBAs in both long and short positions to enhance investment performance and as part of its overall investment strategy. The following table summarizes information on the fair values and notional values of the Company’s derivative instruments: Estimated Fair Value Asset Liability Derivatives Notional December 31, 2021 Futures contracts (2) $ 34,999 $ (9,808) $ 2,826,564 Foreign currency forward contracts (2) 7,734 (11,390) 915,962 TBAs 11,227 — 11,227 Other (2) 73,161 (33,026) 3,736,773 Total $ 127,121 $ (54,224) December 31, 2020 Futures contracts (2) $ 11,046 $ (4,496) $ 3,099,796 Foreign currency forward contracts (2) 52,716 (6,202) 1,656,729 TBAs — — — Other (2) 113,621 (98,007) 5,763,919 Total $ 177,383 $ (108,705) (1) Represents the absolute notional value of all outstanding contracts, consisting of long and short positions. (2) The fair value of asset derivatives are included in ‘other assets’ and the fair value of liability derivatives are included in ‘other liabilities.’ The Company did not hold any derivatives which were designated as hedging instruments at December 31, 2021 or 2020. The Company’s derivative instruments can be traded under master netting agreements, which establish terms that apply to all derivative transactions with a counterparty. In the event of a bankruptcy or other stipulated event of default, such agreements provide that the non-defaulting party may elect to terminate all outstanding derivative transactions, in which case all individual derivative positions (loss or gain) with a counterparty are closed out and netted and replaced with a single amount, usually referred to as the termination amount, which is expressed in a single currency. The resulting single net amount, where positive, is payable to the party “in-the-money” regardless of whether or not it is the defaulting party, unless the parties have agreed that only the non-defaulting party is entitled to receive a termination payment where the net amount is positive and is in its favor. At December 31, 2021, $122.3 million and $53.9 million, respectively, of asset derivatives and liability derivatives were subject to a master netting agreement compared to $138.8 million and $93.0 million, respectively, at December 31, 2020. The remaining derivatives included in the table above were not subject to a master netting agreement. Realized and unrealized contract gains and losses on the Company’s derivative instruments are reflected in net realized gains (losses) in the consolidated statements of income, as summarized in the following table: Derivatives not designated as hedging instruments Year Ended December 31, 2021 2020 2019 Net realized gains (losses): Futures contracts $ (15,262) $ 114,987 $ 114,123 Foreign currency forward contracts (39,755) 49,974 (9,499) TBAs (233) 1,129 463 Other 22,860 13,585 14,654 Total $ (32,390) $ 179,675 $ 119,741 |
Variable Interest Entity and No
Variable Interest Entity and Noncontrolling Interests | 12 Months Ended |
Dec. 31, 2021 | |
Variable Interest Entity and Noncontrolling Interest Disclosure [Abstract] | |
Variable Interest Entity and Noncontrolling Interests | Somers Holdings Ltd. In March 2014, the Company invested $100.0 million and acquired 2,500,000 common shares of Somers. Somers was considered a VIE and the Company concluded that it was the primary beneficiary of Somers, through June 30, 2021. As such, the results of Somers were included in the Company’s consolidated financial statements as of and for the periods ended June 30, 2021. In the 2020 fourth quarter, Arch Capital, Somers and Greysbridge, a wholly-owned subsidiary of Arch Capital, entered into an Agreement and Plan of Merger (as amended, the “Merger Agreement”). The merger and the related Greysbridge equity financing closed on July 1, 2021. Effective July 1, 2021, Somers is wholly owned by Greysbridge, and Greysbridge is owned 40% by the Company, 30% by certain investment funds managed by Kelso and 30% by certain investment funds managed by Warburg. Based on the governing documents of Greysbridge, the Company concluded that, while it retains significant influence over Somers, Somers no longer constitutes a variable interest entity. Accordingly, effective July 1, 2021, the Company no longer consolidates the results of Somers in its consolidated financial statements and footnotes. Beginning in the 2021 third quarter, the Company classifies its investment as ‘investments in operating affiliates’ on the Company’s balance sheets and is accounted for under the equity method. The following table provides the carrying amount and balance sheet caption in which the assets and liabilities of Somers were reported: December 31, 2020 Assets Investments accounted for using the fair value option (1) $ 1,790,385 Fixed maturities available for sale, at fair value 655,249 Equity securities, at fair value 52,410 Cash 211,451 Accrued investment income 14,679 Premiums receivable 224,377 Reinsurance recoverable on unpaid and paid losses and LAE 286,590 Ceded unearned premiums 122,339 Deferred acquisition costs, net 53,705 Receivable for securities sold 37,423 Goodwill and intangible assets 7,650 Other assets 75,801 Total assets of consolidated VIE $ 3,532,059 Liabilities Reserves for losses and loss adjustment expenses $ 1,519,583 Unearned premiums 407,714 Reinsurance balances payable 63,269 Revolving credit agreement borrowings 155,687 Senior notes 172,689 Payable for securities purchased 25,881 Other liabilities 193,494 Total liabilities of consolidated VIE $ 2,538,317 Redeemable noncontrolling interests $ 52,398 (1) Included in “other investments” on the Company’s balance sheet. The following table summarizes Somers’ cash flow from operating, investing and financing activities. Year Ended December 31, 2021 2020 2019 Total cash provided by (used for): Operating activities 46,991 181,736 239,284 Investing activities 96,325 258,589 (140,620) Financing activities (2,042) (335,776) (61,433) Non-redeemable noncontrolling interests Through June 30, 2021, the Company accounted for the portion of Somers’ common equity attributable to third party investors in the shareholders’ equity section of its consolidated balance sheets. The non-controlling ownership in Somers common shares was approximately 87% at December 31, 2020. The portion of Somers’ income or loss attributable to third party investors was recorded in the consolidated statements of income in ‘net (income) loss attributable to noncontrolling interests.’ The following table sets forth activity in the non-redeemable noncontrolling interests: December 31, 2021 2020 Balance, beginning of year $ 823,007 $ 762,777 Impact of deconsolidation of Somers (918,874) — Additional paid in capital attributable to noncontrolling interests 22,113 1,334 Repurchases attributable to non-redeemable noncontrolling interests — (2,867) Amounts attributable to noncontrolling interests 78,314 53,076 Other amounts attributable to noncontrolling interests — (375) Other comprehensive (income) loss attributable to noncontrolling interests (4,560) 9,062 Balance, end of year $ — $ 823,007 Redeemable noncontrolling interests Through June 30, 2021, the Company accounted for redeemable noncontrolling interests in the mezzanine section of its consolidated balance sheets in accordance with applicable accounting guidance. Such redeemable noncontrolling interests primarily related to the Somers Preference Shares issued in late March 2014 with a par value of $0.01 per share and a liquidation preference of $25.00 per share. The Somers Preference Shares were issued at a discounted amount of $24.50 per share. Because the redemption features are not solely within the control of Somers, the Company accounted for the redeemable noncontrolling interests in the Somers Preference Shares in the mezzanine section of its consolidated balance sheets. On August 1, 2019, Somers redeemed 6,919,998 of its 9,065,200 issued and outstanding preference shares (“Somers Preference Shares”) at a total redemption price of $25.19748 per share, inclusive of all declared and unpaid dividends. The Company received $11.5 million pursuant to the redemption of Somers Preference Shares. Preferred dividends on the Somers Preference Shares, including the accretion of the discount and issuance costs, was $2.1 million for 2021, compared to $4.4 million for 2020 and $17.8 million for 2019. The following table sets forth activity in the redeemable noncontrolling interests: December 31, 2021 2020 2019 Balance, beginning of year $ 58,548 $ 55,404 $ 206,292 Impact of deconsolidation of Somers (48,919) — — Redemption of noncontrolling interests — — (157,709) Accretion of preference share issuance costs — 93 244 Other (396) 3,051 6,577 Balance, end of year $ 9,233 $ 58,548 $ 55,404 The portion of income or loss attributable to third party investors is recorded in the consolidated statements of income in ‘net (income) loss attributable to noncontrolling interests’ as summarized in the table below: December 31, 2021 2020 2019 Amounts attributable to non-redeemable noncontrolling interests $ (78,314) $ (53,076) $ (40,072) Amounts attributable to redeemable noncontrolling interests (4,299) (7,114) (16,909) Net (income) loss attributable to noncontrolling interests $ (82,613) $ (60,190) $ (56,981) Bellemeade Re The Company has entered into aggregate excess of loss mortgage reinsurance agreements with various special purpose reinsurance companies domiciled in Bermuda (the “Bellemeade Agreements”). At the time the Bellemeade Agreements were entered into, the applicability of the accounting guidance that addresses VIEs was evaluated. As a result of the evaluation of the Bellemeade Agreements, the Company concluded that these entities are VIEs. However, given that the ceding insurers do not have the unilateral power to direct those activities that are significant to their economic performance, the Company does not consolidate such entities in its consolidated financial statements. The following table presents the total assets of the Bellemeade entities, as well as the Company’s maximum exposure to loss associated with these VIEs, calculated as the maximum historical observable spread between the benchmark index for each respective transaction and short term invested trust asset yields. The benchmark index for agreements effective prior to 2021 is based on one-month LIBOR, while the 2021 agreements benchmark index is based on the Secured Overnight Financing Rate (“SOFR”). SOFR is a measure of the cost of borrowing cash overnight, collateralized by U.S. Treasury securities, and is based on directly observable U.S. Treasury-backed repurchase transactions. Dec 31, 2021 Dec 31, 2020 Maximum Exposure to Loss Maximum Exposure to Loss Bellemeade Entities (Issue Date) Total VIE Assets On-Balance Sheet (Asset) Liability Off-Balance Sheet Total Total VIE Assets On-Balance Sheet (Asset) Liability Off-Balance Sheet Total Bellemeade 2017-1 Ltd. (Oct-17) $ 108,368 $ (159) $ 424 $ 265 $ 145,573 $ (245) $ 844 $ 599 Bellemeade 2018-1 Ltd. (Apr-18) 181,136 (528) 1,268 740 250,095 (903) 2,245 1,342 Bellemeade 2018-2 Ltd. (Aug-18) — — — — 108,395 (138) 280 142 Bellemeade 2018-3 Ltd. (Oct-18) 302,563 (1,018) 2,496 1,478 302,563 (1,320) 3,262 1,942 Bellemeade 2019-1 Ltd. (Mar-19) 181,324 (380) 5,807 5,427 219,256 (1,361) 8,461 7,100 Bellemeade 2019-2 Ltd. (Apr-19) 398,316 (515) 3,998 3,483 398,316 (730) 5,201 4,471 Bellemeade 2019-3 Ltd. (Jul-19) 409,859 (584) 3,190 2,606 528,084 (861) 5,079 4,218 Bellemeade 2019-4 Ltd. (Oct-19) 411,954 (462) 4,759 4,297 468,737 (890) 6,676 5,786 Bellemeade 2020-1 Ltd. (Jun-20) — — — — 275,068 (178) 1,012 834 Bellemeade 2020-2 Ltd. (Sep-20) (1) 217,766 (177) 1,984 1,807 423,420 (556) 6,839 6,283 Bellemeade 2020-3 Ltd. (Nov-20) (2) 348,818 (128) 5,793 5,665 418,158 (631) 9,605 8,974 Bellemeade 2020-4 Ltd. (Dec-20) (3) 176,826 (50) 1,630 1,580 321,393 (156) 6,816 6,660 Bellemeade 2021-1 Ltd. (Mar-21) (4) 568,986 (303) 3,283 2,980 — — — — Bellemeade 2021-2 Ltd. (Jun-21) (5) 522,807 281 4,124 4,405 — — — — Bellemeade 2021-3 Ltd. (Sep-21) (6) 507,873 (411) 3,446 3,035 — — — — Total $ 4,336,596 $ (4,434) $ 42,202 $ 37,768 $ 3,859,058 $ (7,969) $ 56,320 $ 48,351 (1) At December 31, 2021, $1 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). (2) At December 31, 2021, $16 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). (3) At December 31, 2021, $9 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). (4) At December 31, 2021, $61 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). (5) At December 31, 2021, $93 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). |
Other Comprehensive Income
Other Comprehensive Income | 12 Months Ended |
Dec. 31, 2021 | |
Comprehensive Income Note Disclosure [Abstract] | |
Other Comprehensive Income (Loss) | The following table presents the changes in each component of AOCI, net of noncontrolling interests: Unrealized Appreciation on Available-For-Sale Investments Foreign Currency Translation Adjustments Total Year Ended December 31, 2021 Beginning balance $ 501,295 $ (12,400) $ 488,895 Other comprehensive income (loss) before reclassifications (371,741) (65,686) (437,427) Amounts reclassified from accumulated other comprehensive income (116,068) — (116,068) Net current period other comprehensive income (loss) (487,809) (65,686) (553,495) Ending balance $ 13,486 $ (78,086) $ (64,600) Year Ended December 31, 2020 Beginning balance $ 258,486 $ (46,395) $ 212,091 Other comprehensive income (loss) before reclassifications 668,996 33,995 702,991 Amounts reclassified from accumulated other comprehensive income (426,187) — (426,187) Net current period other comprehensive income (loss) 242,809 33,995 276,804 Ending balance $ 501,295 $ (12,400) $ 488,895 Year Ended December 31, 2019 Beginning balance $ (114,178) $ (64,542) $ (178,720) Other comprehensive income (loss) before reclassifications 491,605 18,147 509,752 Amounts reclassified from accumulated other comprehensive income (118,941) — (118,941) Net current period other comprehensive income (loss) 372,664 18,147 390,811 Ending balance $ 258,486 $ (46,395) $ 212,091 The following tables present details about amounts reclassified from accumulated other comprehensive income and the tax effects allocated to each component of other comprehensive income (loss): Consolidated Statement of Income Amounts Reclassified from AOCI Details About Line Item That Includes Year Ended December 31, AOCI Components Reclassification 2021 2020 2019 Unrealized appreciation on available-for-sale investments Net realized gains (losses) $ 157,095 $ 478,659 $ 131,043 Provision for credit losses (2,099) (3,597) — Other-than-temporary impairment losses — (533) (3,165) Total before tax 154,996 474,529 127,878 Income tax (expense) benefit (38,928) (48,342) (8,937) Net of tax $ 116,068 $ 426,187 $ 118,941 Following are the related tax effects allocated to each component of other comprehensive income (loss): Before Tax Tax Expense Net of Tax Amount (Benefit) Amount Year Ended December 31, 2021 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ (406,774) $ (19,845) $ (386,929) Less reclassification of net realized gains (losses) included in net income 154,996 38,928 116,068 Foreign currency translation adjustments (64,423) 59 (64,482) Other comprehensive income (loss) $ (626,193) $ (58,714) $ (567,479) Year Ended December 31, 2020 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ 754,572 $ 75,855 $ 678,717 Less reclassification of net realized gains (losses) included in net income 474,529 48,342 426,187 Foreign currency translation adjustments 33,706 370 33,336 Other comprehensive income (loss) $ 313,749 $ 27,883 $ 285,866 Year Ended December 31, 2019 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ 562,576 $ 61,805 $ 500,771 Less reclassification of net realized gains (losses) included in net income 127,878 8,937 118,941 Foreign currency translation adjustments 18,463 353 18,110 Other comprehensive income (loss) $ 453,161 $ 53,221 $ 399,940 |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | The calculation of basic earnings per common share is computed by dividing income available to Arch common shareholders by the weighted average number of Common Shares and common share equivalents outstanding. The following table sets forth the computation of basic and diluted earnings per common share: Year Ended December 31, 2021 2020 2019 Numerator: Net income $ 2,239,462 $ 1,465,711 $ 1,693,300 Amounts attributable to noncontrolling interests (82,613) (60,190) (56,981) Net income available to Arch 2,156,849 1,405,521 1,636,319 Preferred dividends (48,343) (41,612) (41,612) Loss on redemption of preferred shares (15,101) — — Net income available to Arch common shareholders $ 2,093,405 $ 1,363,909 $ 1,594,707 Denominator: Weighted average common shares outstanding 391,748,715 403,062,179 401,802,815 Effect of dilutive common share equivalents: Nonvested restricted shares 1,996,524 1,682,309 1,673,770 Stock options (1) 6,600,697 5,514,967 8,132,893 Weighted average common shares and common share equivalents outstanding – diluted 400,345,936 410,259,455 411,609,478 Earnings per common share: Basic $ 5.34 $ 3.38 $ 3.97 Diluted $ 5.23 $ 3.32 $ 3.87 (1) Certain stock options were not included in the computation of diluted earnings per share where the exercise price of the stock options exceeded the average market price and would have been anti-dilutive or where, when applying the treasury stock method to in-the-money options, the sum of the proceeds, including unrecognized compensation, exceeded the average market price and would have been anti-dilutive. For 2021, 2020 and 2019, the number of stock options excluded were 2,398,608, 2,249,821 and 1,302,017, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Arch Capital is incorporated under the laws of Bermuda and, under current Bermuda law, is not obligated to pay any taxes in Bermuda based upon income or capital gains. The Company has received a written undertaking from the Minister of Finance in Bermuda under the Exempted Undertakings Tax Protection Act 1966 that, in the event that any legislation is enacted in Bermuda imposing any tax computed on profits, income, gain or appreciation on any capital asset, or any tax in the nature of estate duty or inheritance tax, such tax will not be applicable to Arch Capital or any of its operations until March 31, 2035. This undertaking does not, however, prevent the imposition of taxes on any person ordinarily resident in Bermuda or any company in respect of its ownership of real property or leasehold interests in Bermuda. Arch Capital and its non-U.S. subsidiaries will be subject to U.S. federal income tax only to the extent that they derive U.S. source income that is subject to U.S. withholding tax or income that is effectively connected with the conduct of a trade or business within the U.S. and is not exempt from U.S. Kingdom, Ireland, Canada, Switzerland, Australia and Denmark. The components of income taxes attributable to operations were as follows: Year Ended December 31, 2021 2020 2019 Current expense (benefit): United States $ 284,274 $ 181,571 $ 139,407 Non-U.S. 11,259 16,091 4,954 295,533 197,662 144,361 Deferred expense (benefit): United States (123,261) (89,170) 11,849 Non-U.S. (43,690) 3,346 (400) (166,951) (85,824) 11,449 Income tax expense $ 128,582 $ 111,838 $ 155,810 The Company’s income or loss before income taxes was earned in the following jurisdictions: Year Ended December 31, 2021 2020 2019 Income (Loss) Before Income Taxes: Bermuda $ 1,518,616 $ 1,114,117 $ 1,122,952 United States 643,239 409,893 701,480 Other 206,187 53,539 24,678 Total $ 2,368,042 $ 1,577,549 $ 1,849,110 The expected tax provision computed on pre-tax income or loss at the weighted average tax rate has been calculated as the sum of the pre-tax income in each jurisdiction multiplied by that jurisdiction’s applicable statutory tax rate. The 2021 applicable statutory tax rates by jurisdiction were as follows: Bermuda (0.0%), United States (21.0%), United Kingdom (19.0%), Ireland (12.5%), Denmark (22.0%), Canada (26.5%), Gibraltar (12.5%), Australia (30.0%), Hong Kong (16.5%) and the Netherlands (25.0%). A reconciliation of the difference between the provision for income taxes and the expected tax provision at the weighted average tax rate follows: Year Ended December 31, 2021 2020 2019 Expected income tax expense (benefit) computed on pre-tax income at weighted average income tax rate $ 158,269 $ 111,947 $ 149,799 Addition (reduction) in income tax expense (benefit) resulting from: Tax-exempt investment income (23,572) (1,824) (3,091) Meals and entertainment 379 547 1,134 State taxes, net of U.S. federal tax benefit 20,978 5,027 3,314 Foreign branch taxes 1,998 2,094 1,231 Prior year adjustment (1,432) 3,983 632 Foreign exchange gains & losses 1,190 (1,736) 436 Changes in applicable tax rate 447 — — Dividend withholding taxes 12,211 7,105 6,510 Change in valuation allowance (40,425) 13,190 1,628 Contingent consideration — 9 190 Share based compensation (5,339) (2,533) (6,592) Intercompany loan write-off — (22,083) — Other 3,878 (3,888) 619 Income tax expense (benefit) $ 128,582 $ 111,838 $ 155,810 The effect of a change in tax laws or rates on deferred tax assets and liabilities is recognized in income in the period in which such change is enacted. Deferred income tax assets and liabilities reflect temporary differences based on enacted tax rates between the carrying amounts of assets and liabilities for financial reporting and income tax purposes. Significant components of the Company’s deferred income tax assets and liabilities were as follows: December 31, 2021 2020 Deferred income tax assets: Net operating loss $ 87,960 $ 67,142 Uncrystallized losses — 2,926 Discounting of net loss reserves 72,001 74,247 Net unearned premium reserve 75,483 66,368 Compensation liabilities 28,062 27,351 Foreign tax credit carryforward 20,058 19,160 Interest expense 755 622 Goodwill and intangible assets — 14,450 Bad debt reserves 10,252 10,842 Depreciation and amortization 115,041 — Lease liability 21,453 23,604 Net unrealized foreign exchange gains 166 165 Other, net — 2,318 Deferred tax assets before valuation allowance 431,231 309,195 Valuation allowance (43,953) (88,255) Deferred tax assets net of valuation allowance 387,278 220,940 Deferred income tax liabilities: Depreciation and amortization — (495) Deposit accounting liability (1,578) (1,751) Goodwill and intangibles (70,549) — Lloyds year of account deferral (12,514) — Contingency reserve (49,486) (64,593) Deferred policy acquisition costs (25,612) (42,045) Investment related (7,492) (9,571) Net unrealized appreciation of investments (8,377) (66,681) Right-of-use asset (17,406) (19,239) Other, net (218) (843) Total deferred tax liabilities (193,232) (205,218) Net deferred income tax assets $ 194,046 $ 15,722 The Company provides a valuation allowance to reduce the net value of certain deferred tax assets to an amount which management expects to more likely than not be realized. As of December 31, 2021, the Company’s valuation allowance was $44.0 million, compared to $88.3 million at December 31, 2020. The valuation allowance at December 31, 2021, was primarily attributable to valuation allowances on the Company’s U.K., Canadian and Hong Kong operations and certain other deferred tax assets relating to loss carryforwards that have a limited use. At December 31, 2021, the Company’s net operating loss carryforwards and tax credits were as follows: Year Ended December 31, 2021 Expiration Operating Loss Carryforwards United Kingdom $ 259,235 No expiration Ireland 9,032 No expiration Australia 39,981 No expiration Hong Kong 23,203 No expiration United States (1) 29,508 2029 - 2038 Tax Credits U.K. foreign tax credits 20,058 No expiration (1) On January 30, 2014, the Company’s U.S. mortgage operations underwent an ownership change for U.S. federal income tax purposes as a result of the Company’s acquisition of the CMG Entities. As a result of this ownership change, a limitation has been imposed upon the utilization of approximately $7.6 million of the Company’s existing U.S. net operating loss carryforwards. Utilization is limited to approximately $0.6 million per year in accordance with Section 382 of the Internal Revenue Code of 1986 as amended (“the Code”). The Company’s U.S. mortgage operations are eligible for a tax deduction, subject to certain limitations, under Section 832(e) of the Code for amounts required by state law or regulation to be set aside in statutory contingency reserves. The deduction is allowed only to the extent that the Company purchases non-interest bearing U.S. Mortgage Guaranty Tax and Loss Bonds (“T&L Bonds”) issued by the U.S. Treasury Department in an amount equal to the tax benefit derived from deducting any portion of the statutory contingency reserves. T&L Bonds are reflected in ‘other assets’ on the Company’s balance sheet and totaled approximately $31.6 million at December 31, 2021, compared to $88.1 million at December 31, 2020. Deferred income tax liabilities have not been accrued with respect to the undistributed earnings of the Company's U.S., U.K. and Ireland subsidiaries as it is the Company’s intention that all such earnings will be indefinitely reinvested. If the earnings were to be distributed, as dividends or otherwise, such amounts may be subject to withholding tax in the jurisdiction of the paying entity. The Company no longer intends to indefinitely reinvest earnings from the Company's Canada subsidiary, however, no income or withholding taxes have been accrued as the Canada subsidiary does not have positive cumulative earnings and profits and therefore a distribution from this particular subsidiary would not be subject to income taxes or withholding taxes. Potential tax implications of repatriation from the Company’s unremitted earnings that are indefinitely reinvested are driven by facts at the time of distribution. Therefore it is not practicable to estimate the income tax liabilities that might be incurred if such earnings were remitted. Distributions from the U.K. or Ireland would not be subject to withholding tax and no deferred income tax liability would need to be accrued. The Company recognizes interest and penalties relating to unrecognized tax benefits in the provision for income taxes. As of December 31, 2021, the Company’s total unrecognized tax benefits, including interest and penalties, were $2.0 million. If recognized, the full amount of the unrecognized tax benefit would impact the consolidated effective tax rate. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: December 31, 2021 2020 Balance at beginning of year $ 2,008 $ 2,008 Additions based on tax positions related to the current year — — Additions for tax positions of prior years — — Reductions for tax positions of prior years — — Settlements — — Balance at end of year $ 2,008 $ 2,008 The Company, its subsidiaries and branches file income tax returns in various federal, state and local jurisdictions. The following table details open tax years that are potentially subject to examination by local tax authorities, in the following major jurisdictions: Jurisdiction Tax Years United States 2015-2021 United Kingdom 2020-2021 Ireland 2017-2021 Canada 2017-2021 Switzerland 2018-2021 Denmark 2017-2021 Australia 2017-2021 As of December 31, 2021, the Company’s current income tax payable (included in “Other liabilities”) was $14.8 million. |
Transactions with Related Parti
Transactions with Related Parties | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Transactions with Related Parties | In 2017, the Company acquired approximately 25% of Premia Holdings Ltd. Premia Holdings Ltd. is the parent of Premia Reinsurance Ltd., a multi-line Bermuda reinsurance company (together with Premia Holdings Ltd., “Premia”). Premia’s strategy is to reinsure or acquire companies or reserve portfolios in the non-life property and casualty insurance and reinsurance run-off market. Arch Re Bermuda and certain Arch co-investors invested $100.0 million and acquired approximately 25% of Premia as well as warrants to purchase additional common equity. Arch has appointed two directors to serve on the seven person board of directors of Premia. Arch Re Bermuda is providing a 25% quota share reinsurance treaty on certain business written by Premia. In the 2021 first quarter, as part of the Company’s acquisition of Barbican, the Company entered into an agreement with Premia Managing Agency Limited for the reinsurance to close of Syndicate 1955’s 2018 underwriting year of account into Premia Syndicate 1884’s 2021 underwriting year of account. The reinsurance to close covers legacy business underwritten by Syndicate 1955 on the underwriting 2018 and prior years of account and under the agreement, approximately $380 million of net liabilities was transferred to Syndicate 1884, with an effective date of January 1, 2021. The Company had no reinsurance recoverable on unpaid and paid losses or funds held liability at December 31, 2021, compared to $199.8 million and $149.6 million, respectively, at December 31, 2020. In July 2021, following consummation of the Merger Agreement and the related Greysbridge equity financing, pursuant to which Somers is wholly owned by Greysbridge, and Greysbridge is owned 40% by the Company, 30% by certain funds managed by Kelso and 30% by certain funds managed by Warburg, the Company entered into certain reinsurance transactions with Somers. For 2021, the Company ceded premiums written related to such transactions of $453.9 million (which includes reinsurance transactions in force as well as those entered into in conjunction with the Merger Agreement). In addition, Somers paid certain acquisition costs and administrative fees to the Company. At December 31, 2021, the Company recorded a reinsurance recoverable on unpaid and paid losses from Somers of $902.8 million and a reinsurance balance payable to Somers of $258.4 million. See note 12, “Variable Interest Entity and Noncontrolling Interests.” The Company has a put/call option that was entered into in connection with the Greysbridge equity financing, whereby beginning January 1, 2024 the Company will have a call right (but not the obligation) and Warburg and Kelso will each have a put right (but not the obligation) to buy/sell one third of their initial shares annually at the tangible book value per share of Greysbridge for the most recently ended fiscal quarter. As of December 31, 2021, the Company owns $35.0 million in aggregate principal amount of Somers 6.5% senior notes, due July 2, 2029 and approximately 6.6% of Somers’ preference shares. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Leases | In the ordinary course of business, the Company renews and enters into new leases for office property and equipment. At the lease inception date, the Company determines whether a contract contains a lease and its classification as a finance or operating lease. Primarily all of the Company’s leases are classified as operating leases. The Company’s operating leases have remaining lease terms of up to 11 years, some of which include options to extend the lease term. The Company considers these options when determining the lease term and measuring its lease liability and right-of-use asset. In addition, the Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. Short-term operating leases with an initial term of twelve months or less were excluded on the Company's consolidated balance sheet and represent an inconsequential amount of operating lease expense. As most leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. Additional information regarding the Company’s operating leases is as follows: December 31, 2021 2020 Operating lease costs $ 31,691 $ 31,826 Cash payments included in the measurement of lease liabilities reported in operating cash flows $ 32,094 $ 30,365 Right-of-use assets obtained in exchange for new lease liabilities $ 22,686 $ 12,060 Right-of-use assets (1) $ 106,836 $ 115,911 Operating lease liability (1) $ 126,711 $ 136,015 Weighted average discount rate 3.9 % 3.9 % Weighted average remaining lease term 5.9 years 5.8 years (1) The right-of-use assets are included in ‘ other assets The following table presents the contractual maturities of the Company's operating lease liabilities at December 31, 2021: Years Ending December 31, 2022 $ 31,682 2023 25,288 2024 22,102 2025 16,253 2026 13,430 2027 and thereafter 34,173 Total undiscounted lease liability 142,928 Less: present value adjustment (16,217) Operating lease liability 126,711 All of these leases are for the rental of office space, with expiration terms that range from 2022 to 2033. Rental expense was approximately $31.7 million, $31.8 million and $30.5 million for 2021, 2020 and 2019, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Concentrations of Credit Risk The creditworthiness of a counterparty is evaluated by the Company, taking into account credit ratings assigned by independent agencies. The credit approval process involves an assessment of factors, including, among others, the counterparty, country and industry credit exposure limits. Collateral may be required, at the discretion of the Company, on certain transactions based on the creditworthiness of the counterparty. The areas where significant concentrations of credit risk may exist include unpaid losses and loss adjustment expenses recoverable, contractholder receivables, ceded unearned premiums, paid losses and loss adjustment expenses recoverable net of reinsurance balances payable, investments and cash and cash equivalent balances. A credit exposure exists with respect to reinsurance recoverables as they may become uncollectible. The Company manages its credit risk in its reinsurance relationships by transacting with reinsurers that it considers financially sound and, if necessary, the Company may hold collateral in the form of funds, trust accounts and/or irrevocable letters of credit. This collateral can be drawn on for amounts that remain unpaid beyond specified time periods on an individual reinsurer basis. In addition, certain insurance policies written by the Company’s insurance operations feature large deductibles, primarily in its construction and national accounts lines of business. Under such contracts, the Company is obligated to pay the claimant for the full amount of the claim. The Company is subsequently reimbursed by the policyholder for the deductible amount. These amounts are included on a gross basis in the consolidated balance sheet in contractholder payables and contractholder receivables, respectively. In the event that the Company is unable to collect from the policyholder, the Company would be liable for such defaulted amounts. Collateral, primarily in the form of letters of credit, cash and trusts, is obtained from the policyholder to mitigate the Company’s credit risk. In the instances where the company receives collateral in the form of cash, the Company records a related liability in “Collateral held for insured obligations.” In addition, the Company underwrites a significant amount of its business through brokers and a credit risk exists should any of these brokers be unable to fulfill their contractual obligations with respect to the payments of insurance and reinsurance balances owed to the Company. The following table summarizes the percentage of the Company’s gross premiums written generated from or placed by the largest brokers: Broker Year Ended December 31, 2021 2020 2019 Marsh & McLennan Companies and its subsidiaries 18.3 % 13.3 % 9.6 % Aon Corporation and its subsidiaries 12.2 % 12.0 % 12.2 % No other broker and no one insured or reinsured accounted for more than 10% of gross premiums written for 2021, 2020 and 2019. The Company’s available for sale investment portfolio is managed in accordance with guidelines that have been tailored to meet specific investment strategies, including standards of diversification, which limit the allowable holdings of any single issue. There were no investments in any entity in excess of 10% of the Company’s shareholders’ equity at December 31, 2021 other than investments issued or guaranteed by the United States government or its agencies. Investment Commitments The Company’s investment commitments, which are primarily related to agreements entered into by the Company to invest in funds and separately managed accounts when called upon, were approximately $3.0 billion and $2.1 billion at December 31, 2021 and 2020, respectively. Purchase Obligations The Company has also entered into certain agreements which commit the Company to purchase goods or services, primarily related to software and computerized systems. Such purchase obligations were approximately $114.1 million and $73.0 million at December 31, 2021 and 2020, respectively. Employment and Other Arrangements At December 31, 2021, the Company has entered into employment agreements with certain of its executive officers. Such employment arrangements provide for compensation in the form of base salary, annual bonus, share-based awards, participation in the Company’s employee benefit programs and the reimbursements of expenses. |
Debt and Financing Arrangements
Debt and Financing Arrangements | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt and Financing Arrangements | Debt and Financing Arrangements The Company’s senior notes payable at December 31, 2021 and 2020 were as follows: Carrying Amount at Interest Principal December 31, (Fixed) Amount 2021 2020 2034 notes (1) 7.350 % 300,000 297,488 297,367 2043 notes (2) 5.144 % 500,000 495,063 494,944 2026 notes (3) 4.011 % 500,000 497,633 497,211 2046 notes (4) 5.031 % 450,000 445,490 445,402 2050 notes (5) 3.635 % 1,000,000 988,720 988,500 Somers notes (6) 137,689 $ 2,750,000 $ 2,724,394 $ 2,861,113 (1) Senior notes of Arch Capital issued on May 4, 2004 and due May 1, 2034 (“2034 notes”). (2) Senior notes of Arch-U.S., a wholly-owned subsidiary of Arch Capital, issued on December 13, 2013 and due November 1, 2043 (“2043 notes”), fully and unconditionally guaranteed by Arch Capital. (3) Senior notes of Arch Capital Finance LLC (“Arch Finance”), a wholly-owned finance subsidiary of Arch Capital, issued on December 8, 2016 and due December 15, 2026 (“2026 notes”), fully and unconditionally guaranteed by Arch Capital. (4) Senior notes of Arch Finance issued on December 8, 2016 and due December 15, 2046 (“2046 notes”), fully and unconditionally guaranteed by Arch Capital (5) Senior notes of Arch Capital issued on June 30, 2020 and due June 30, 2050 (“2050 notes”). (6) Senior notes of Somers issued on July 2, 2019 and due July 2, 2029 (“Somers Senior Notes”), reflecting the elimination of amounts owned by Arch-U.S. Effective July 1, 2021, the Company no longer consolidates Somers in its financials. See note 12. The 2034 notes are Arch Capital’s senior unsecured obligations and rank equally with all of its existing and future senior unsecured indebtedness. Interest payments on the 2034 notes are due on May 1st and November 1st of each year. Arch Capital may redeem the 2034 notes at any time and from time to time, in whole or in part, at a “make-whole” redemption price. The 2043 notes are unsecured and unsubordinated obligations of Arch-U.S. and Arch Capital, respectively, and rank equally and ratably with the other unsecured and unsubordinated indebtedness of Arch-U.S. and Arch Capital, respectively. Interest payments on the 2043 notes are due on May 1st and November 1st of each year. Arch-U.S. may redeem the 2043 notes at any time and from time to time, in whole or in part, at a “make-whole” redemption price. The 2026 notes are unsecured and unsubordinated obligations of Arch Finance and Arch Capital, respectively, and rank equally and ratably with the other unsecured and unsubordinated indebtedness of Arch Finance and Arch Capital, respectively. Interest payments on the 2026 notes are due on June 15th and December 15th of each year. Arch Finance may redeem the 2026 notes at any time and from time to time, in whole or in part, at a “make-whole” redemption price. The 2046 notes are unsecured and unsubordinated obligations of Arch Finance and Arch Capital, respectively, and rank equally and ratably with the other unsecured and unsubordinated indebtedness of Arch Finance and Arch Capital, respectively. Interest payments on the 2046 notes are due on June 15th and December 15th of each year. Arch Finance may redeem the 2046 notes at any time and from time to time, in whole or in part, at a “make-whole” redemption price. The 2050 notes are Arch Capital’s senior unsecured obligations and rank equally with all of its existing and future senior unsecured indebtedness. Interest payments on the 2050 notes are due on June 30 and December 30 of each year. Arch Capital may redeem the 2050 notes at any time and from time to time, in whole or in part, at a “make-whole” redemption price. Interest payments on the Somers Senior Notes due on each January 2 and July 2, commencing January 2, 2020. The Company purchased $35.0 million in aggregate principal amount of the Somers Senior Notes. Effective July 1, 2021, the Company no longer consolidates the results of Somers in its consolidated financial statements and footnotes. See note 12, “Variable Interest Entity and Noncontrolling Interests.” Letter of Credit and Revolving Credit Facilities In the normal course of its operations, the Company enters into agreements with financial institutions to obtain secured and unsecured credit facilities. On December 17, 2019, Arch Capital and certain of its subsidiaries entered into a $750.0 million five aggregate of $1.3 billion. Arch Capital has a one-time option to convert any or all outstanding revolving loans of Arch Capital and/or Arch-U.S. to term loans with the same terms as the revolving loans except that any prepayments may not be re-borrowed. Arch-U.S. guarantees the obligations of Arch Capital, and Arch Capital guarantees the obligations of Arch-U.S. Borrowings of revolving loans may be made at a variable rate based on LIBOR or an alternative base rate at the option of Arch Capital. Arch Capital and its lenders may agree on a LIBOR successor rate at the appropriate time to address the replacement of LIBOR. Secured letters of credit are available for issuance on behalf of certain Arch Capital subsidiaries. The Credit Facility is structured such that each party that requests a letter of credit or borrowing does so only for itself and its own obligations. The Credit Facility contains certain restrictive covenants customary for facilities of this type, including restrictions on indebtedness, consolidated tangible net worth, minimum shareholders’ equity levels and minimum financial strength ratings. Arch Capital and its subsidiaries which are party to the agreement were in compliance with all covenants contained therein at December 31, 2021. Commitments under the Credit Facility will expire on December 17, 2024, and all loans then outstanding must be repaid. Letters of credit issued under the Unsecured Facility will not have an expiration date later than December 17, 2025. Under the $250.0 million secured letter of credit facility, Arch Capital’s subsidiaries had $240.4 million of letters of credit outstanding and remaining capacity of $9.6 million at December 31, 2021. In addition, certain of Arch Capital’s subsidiaries had outstanding secured and unsecured letters of credit of $26.0 million and $290.0 million respectively, which were issued in the normal course of business. When issued, all secured letters of credit are secured by a portion of the investment portfolio. At December 31, 2021, these letters of credit were secured by investments with a fair value of $348.4 million. The Company’s outstanding revolving credit agreement borrowings were as follows: Year Ended December 31, 2021 2020 Arch Capital $ — $ — Somers 155,687 Total $ — $ 155,687 Federal Home Loan Bank Membership Certain subsidiaries of the Company are members of Federal Home Loan Banks (“FHLBs”). Members may borrow from the FHLBs at competitive rates subject to certain conditions. Conditions include maintaining sufficient collateral deposits for funding and a requirement to hold stock in the FHLBs related to both membership and outstanding advances. At December 31, 2021 and 2020, the Company had $80.0 million of advances outstanding under the FHLB program, included in ‘other liabilities’ on the Company’s balance sheet, secured by investments with a fair value of $80.2 million. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | The following table shows an analysis of goodwill and intangible assets: Goodwill Intangible assets (indefinite life) Intangible assets (finite life) Total Net balance at Dec. 31, 2019 $ 326,551 $ 85,911 $ 325,621 $ 738,083 Acquisitions — — 39,178 39,178 Amortization — — (69,031) (69,031) Foreign currency movements and other adjustments (11,922) (6,692) 3,247 (15,367) Net balance at Dec. 31, 2020 314,629 79,219 299,015 692,863 Acquisitions (1) 31,677 — 318,459 350,136 Amortization — — (82,955) (82,955) Impact of deconsolidation of Somers (2) — (7,650) — (7,650) Foreign currency movements and other adjustments (1,441) (212) (5,758) (7,411) Net balance at Dec. 31, 2021 $ 344,865 $ 71,357 $ 528,761 $ 944,983 Gross balance at Dec. 31, 2021 $ 342,842 $ 70,246 $ 1,102,298 $ 1,515,386 Accumulated amortization — — (571,839) (571,839) Foreign currency movements and other adjustments 2,023 1,111 (1,698) 1,436 Net balance at Dec. 31, 2021 $ 344,865 $ 71,357 $ 528,761 $ 944,983 (1) Certain amounts for the Company’s 2021 acquisitions are considered provisional. (2) See note 12 . The following table presents the components of goodwill and intangible assets: Gross Balance Accumulated Foreign Currency Translation Adjustment and Other Net Dec. 31, 2021 Acquired insurance contracts $ 451,505 $ (409,592) $ 339 $ 42,252 Operating platform 52,674 (48,838) 56 3,892 Distribution relationships 602,518 (120,302) (2,207) 480,009 Goodwill 342,842 — 2,023 344,865 Insurance licenses 48,331 — — 48,331 Syndicate capacity 21,915 — 1,111 23,026 Unfavorable service contract (9,533) 9,435 — (98) Other 5,134 (2,542) 114 2,706 Total $ 1,515,386 $ (571,839) $ 1,436 $ 944,983 Dec. 31, 2020 Acquired insurance contracts $ 451,505 $ (381,349) $ 284 $ 70,440 Operating platform 52,674 (44,347) 60 8,387 Distribution relationships 285,141 (71,383) 3,450 217,208 Goodwill 318,043 — (3,414) 314,629 Insurance licenses 55,981 — — 55,981 Syndicate capacity 21,915 — 1,324 23,239 Unfavorable service contract (9,533) 9,147 — (386) Other 5,134 (1,896) 127 3,365 Total $ 1,180,860 $ (489,828) $ 1,831 $ 692,863 The estimated remaining amortization expense for the Company’s intangible assets with finite lives is as follows: 2022 $ 109,144 2023 99,620 2024 79,410 2025 44,523 2026 35,252 2027 and thereafter 160,812 Total $ 528,761 one |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Authorized and Issued The authorized share capital of Arch Capital consists of 1.8 billion Common Shares, par value of $0.0011 per share, and 50 million Preferred Shares, par value of $0.01 per share. Common Shares The following table presents a roll-forward of changes in Arch Capital’s issued and outstanding Common Shares: Year Ended December 31, 2021 2020 2019 Common Shares: Shares issued and outstanding, beginning of year 579,000,841 574,617,195 570,737,283 Shares issued (1) 2,669,229 2,646,164 2,835,994 Restricted shares issued, net of cancellations 1,619,780 1,737,482 1,043,918 Shares issued and outstanding, end of year 583,289,850 579,000,841 574,617,195 Common shares in treasury, end of year (204,365,956) (172,280,199) (168,997,994) Shares issued and outstanding, end of year 378,923,894 406,720,642 405,619,201 (1) Includes shares issued from the exercise of stock options and stock appreciation rights, the vesting of restricted share units and shares issued from the employee share purchase plan. Share Repurchase Program The board of directors of Arch Capital has authorized the investment in Arch Capital’s common shares through a share repurchase program. At December 31, 2021, $1.2 billion of share repurchases were available under the program. Repurchases under the program may be effected from time to time in open market or privately negotiated transactions through December 31, 2022. The timing and amount of the repurchase transactions under this program will depend on a variety of factors, including market conditions and corporate and regulatory considerations. Repurchases of Arch Capital’s common shares in connection with the share repurchase plan and other share-based transactions were held in the treasury under the cost method, and the cost of the common shares acquired is included in ‘Common shares held in treasury, at cost.’ At December 31, 2021, Arch Capital held 204.4 million shares for an aggregate cost of $3.8 billion in treasury, at cost. The Company’s repurchases under the share repurchase program were as follows: Year Ended December 31, 2021 2020 2019 Aggregate cost of shares repurchased $ 1,234,294 $ 83,472 $ 2,871 Shares repurchased 31,486,830 2,850,102 110,598 Average price per share repurchased $ 39.20 $ 29.29 $ 25.96 Since the inception of the share repurchase program through December 31, 2021, Arch Capital has repurchased approximately 420.7 million common shares for an aggregate purchase price of $5.3 billion. Series G Preferred Shares In June 2021, Arch Capital completed a $500 million underwritten public offering of 20.0 million depositary shares (the “Depositary Shares”), each of which represents a 1/1,000th interest in a share of its 4.55% Non-Cumulative Preferred Shares, Series G, $0.01 par value and $25,000 liquidation preference per share (equivalent to $25 liquidation preference per Depositary Share) (the “Series G Preferred Shares”). Each Depositary Share, evidenced by a depositary receipt, entitles the holder, through the depositary, to a proportional fractional interest in all rights and preferences of the Series G Preferred Shares represented thereby (including any dividend, liquidation, redemption and voting rights). Holders of Series G Preferred Shares will be entitled to receive dividend payments only when, as and if declared by the Company’s board of directors or a duly authorized committee of the board. Any such dividends will be payable from, and including, the date of original issue on a noncumulative basis, quarterly in arrears on the last day of March, June, September and December of each year, at an annual rate of 4.55%. Dividends on the Series G Preferred Shares are not cumulative. The Company will be restricted from paying dividends on or repurchasing its common shares unless certain dividend payments are made on the Series G Preferred Shares. The Company may not declare or pay a dividend on the Series G Preferred Shares under certain circumstances, including if the Company is or, after giving effect to such payment, would be in breach of applicable individual or group solvency and liquidity requirements or applicable individual or group enhanced capital requirements ("ECR"). The Series G Preferred Shares may not be redeemed at any time if the ECR would be breached immediately before or after giving effect to such redemption, unless the Company replaces the capital represented by preference shares to be redeemed with capital having equal or better capital treatment. Except in specified circumstances relating to certain tax or corporate events, the Series G Preferred Shares are not redeemable prior to June 11, 2026. On and after that date, the Series G Preferred Shares will be redeemable at the Company’s option, in whole or in part, at a redemption price of $25,000 per share of the Series G Preferred Shares (equivalent to $25 per depositary share), plus any declared and unpaid dividends, without accumulation of any undeclared dividends to, but excluding, the redemption date. The Depositary Shares will be redeemed if and to the extent the related Series G Preferred Shares are redeemed by the Company. Neither the Depositary Shares nor the Series G Preferred Shares have a stated maturity, nor will they be subject to any sinking fund or mandatory redemption. The Series G Preferred Shares are not convertible into any other securities. The Series G Preferred Shares do not have voting rights, except under limited circumstances. The net proceeds from the Series G Preferred Share offerings were used to redeem the Company’s outstanding 5.25% Series E Non-Cumulative Preferred Shares. Series F Preferred Shares In August 2017 and November 2017, Arch Capital completed combined $330 million of underwritten public offerings ($230 million in August 2017 and $100 million in November 2017) of 13.2 million depositary shares (the “Series F Depositary Shares”), each of which represents a 1/1,000th interest in a share of its 5.45% Non-Cumulative Preferred Shares, Series F, with a $0.01 par value and $25,000 liquidation preference per share (equivalent to $25 liquidation preference per Series F Depositary Share) (the “Series F Preferred Shares”). Each Series F Depositary Share, evidenced by a depositary receipt, entitles the holder, through the depositary, to a proportional fractional interest in all rights and preferences of the Series F Preferred Shares represented thereby (including any dividend, liquidation, redemption and voting rights). Holders of Series F Preferred Shares will be entitled to receive dividend payments only when, as and if declared by our board of directors or a duly authorized committee of the board. Any such dividends will be payable from, and including, the date of original issue on a noncumulative basis, quarterly in arrears on the last day of March, June, September and December of each year, at an annual rate of 5.45%. Dividends on the Series F Preferred Shares are not cumulative. The Company will be restricted from paying dividends on or repurchasing its common shares unless certain dividend payments are made on the Series F Preferred Shares. Except in specified circumstances relating to certain tax or corporate events, the Series F Preferred Shares are not redeemable prior to August 17, 2022 (the fifth anniversary of the issue date). On and after that date, the Series F Preferred Shares will be redeemable at the Company’s option, in whole or in part, at a redemption price of $25,000 per share of the Series F Preferred Shares (equivalent to $25 per depositary share), plus any declared and unpaid dividends, without accumulation of any undeclared dividends to, but excluding, the redemption date. The Series F Depositary Shares will be redeemed if and to the extent the related Series F Preferred Shares are redeemed by the Company. Neither the Series F Depositary Shares nor the Series F Preferred Shares have a stated maturity, nor will they be subject to any sinking fund or mandatory redemption. The Series F Preferred Shares are not convertible into any other securities. The Series F Preferred Shares will not have voting rights, except under limited circumstances. The net proceeds from the Series F Preferred Share offerings were used to redeem the Company’s outstanding 6.75% Series C Non-Cumulative Preferred Shares. Series E Preferred Shares In September, 2021, Arch Capital redeemed all outstanding 5.25% Series E non-cumulative preferred shares. The preferred shares were redeemed at a redemption price equal to $25 per share, plus all declared and unpaid dividends to (but excluding) the redemption date. In accordance with GAAP, following the redemption, original issuance costs related to such shares have been removed from additional paid-in capital and recorded as a “loss on redemption of preferred shares.” Such adjustment had no impact on total shareholders’ equity or cash flows. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Compensation | Long Term Incentive and Share Award Plans The Company utilizes share-based compensation plans for officers, other employees and directors of Arch Capital and its subsidiaries to provide competitive compensation opportunities, to encourage long-term service, to recognize individual contributions and reward achievement of performance goals and to promote the creation of long-term value for shareholders by aligning the interests of such persons with those of shareholders. The 2018 Long-Term Incentive and Share Award Plan (the “2018 Plan”) became effective as of May 9, 2018 following approval by shareholders of the Company. The 2018 Plan provides for the issuance of restricted stock units, performance units, restricted shares, performance shares, stock options and stock appreciation rights and other equity-based awards to our employees and directors. The 2018 Plan authorizes the issuance of 34,500,000 common shares and will terminate as to future awards on February 28, 2028. At December 31, 2021, 9,909,950 shares are available for future issuance. The 2015 Long Term Incentive and Share Award Plan (the (“2015 Plan”) authorizes the issuance of 12,900,000 common shares and became effective as of May 7, 2015 following approval by shareholders of the Company. The 2015 Plan provides for the issuance of share-based awards to our employees and directors and will terminate as to future awards on February 26, 2025. At December 31, 2021, 606,942 shares are available for future issuance. The 2012 Long Term Incentive and Share Award Plan (the “2012 Plan”) became effective as of May 9, 2012 following approval by shareholders of the Company. The 2012 Plan authorizes the issuance of 22,301,772 common shares and will terminate as to future awards on February 28, 2022. At December 31, 2021, 320,272 shares are available for grant under the 2012 Plan. Upon shareholder approval on May 6, 2016, the Amended and Restated Arch Capital Group Ltd. 2007 Employee Share Purchase Plan (the “ESPP”) became effective and a total of 4,689,777 common shares were reserved for issuance. The purpose of the ESPP is to give employees of Arch Capital and its subsidiaries an opportunity to purchase common shares through payroll deductions, thereby encouraging employees to share in the economic growth and success of Arch Capital and its subsidiaries. The ESPP is designed to qualify as an “employee share purchase plan” under Section 423 of the Code. At December 31, 2021, 1,608,354 shares remain available for issuance. Stock Options and Stock Appreciation Rights The Company generally issues stock options and SARs to eligible employees, with exercise prices equal to the fair market values of the Company’s Common Shares on the grant dates. Such grants generally vest over a three The grant date fair value is determined using the Black-Scholes option valuation model. The expected life assumption is based on an expected term analysis, which incorporates the Company’s historical exercise experience. Expected volatility is based on the Company’s daily historical trading data of its common shares. The table below summarizes the assumptions used. Year Ended December 31, 2021 2020 2019 Dividend yield — % — % — % Expected volatility 24.2 % 16.6 % 18.1 % Risk free interest rate 1.0 % 1.2 % 2.5 % Expected option life 6.0 years 6.0 years 6.0 years A summary of stock option and SAR activity under the Company’s Long Term Incentive and Share Award Plans during 2021 is presented below: Year Ended December 31, 2021 Number of Weighted Average Exercise Price Weighted Average Contractual Term Aggregate Intrinsic Value Outstanding, beginning of year 17,839,333 $ 23.32 Granted 1,243,984 $ 35.90 Exercised (1,931,320) $ 15.57 Forfeited or expired (68,837) $ 35.39 Outstanding, end of year 17,083,160 $ 25.06 4.41 $ 331,214 Exercisable, end of year 14,730,147 $ 23.20 3.78 $ 312,966 The aggregate intrinsic value of stock options and SARs exercised represents the difference between the exercise price of the stock options and SARs and the closing market price of the Company’s common shares on the exercise dates. During 2021, the Company received proceeds of $10.1 million from the exercise of stock options and recognized a tax benefit of $5.4 million from the exercise of stock options and SARs. Year Ended December 31, 2021 2020 2019 Weighted average grant date fair value $ 9.22 $ 8.14 $ 7.90 Aggregate intrinsic value of Options/SARs exercised $ 47,074 $ 59,723 $ 51,350 Restricted Common Shares and Restricted Units The Company also issues restricted share and unit awards to eligible employees and directors, for which the fair value is equal to the fair market values of the Company’s Common Shares on the grant dates. Restricted share and unit awards generally vest over a three A summary of restricted share and restricted unit activity under the Company’s Long Term Incentive and Share Award Plans for 2021 is presented below: Restricted Common Shares Restricted Unit Awards Unvested Shares: Unvested balance, beginning of year 1,635,845 1,121,719 Granted 1,085,811 175,962 Vested (549,892) (555,870) Forfeited (100,927) (41,945) Unvested balance, end of year 2,070,837 699,866 Weighted Average Grant Date Fair Value: Unvested balance, beginning of year $ 36.34 $ 31.43 Granted $ 36.14 $ 35.94 Vested $ 35.94 $ 30.46 Forfeited $ 36.28 $ 32.23 Unvested balance, end of year $ 36.35 $ 33.29 The following table presents the weighted average grant date fair value of restricted shares and restricted unit awards granted and the aggregate fair value of restricted shares and unit awards vesting in each year. Year Ended December 31, 2021 2020 2019 Restricted shares and restricted unit awards granted 1,261,773 1,535,330 1,195,741 Weighted average grant date fair value $ 36.12 $ 37.55 $ 32.89 Aggregate fair value of vested restricted share and unit awards $ 65,477 $ 39,703 $ 46,262 The aggregate intrinsic value of restricted units outstanding at December 31, 2021 was $31.1 million. Performance Awards The Company also issues performance share and unit awards (“performance awards”) to eligible employees, which are earned based on the achievement of pre-established threshold, target and maximum goals over three Year Ended December 31, 2021 2020 2019 Expected volatility 37.5 % 18.1 % 17.1 % Risk free interest rate 0.3 % 1.1 % 2.5 % Performance Shares Performance Units Unvested Shares: Unvested balance, beginning of year 1,851,382 32,065 Granted 674,406 10,698 Performance adjustment (1) (2) (39,510) 11,447 Vested (624,518) (24,440) Unvested balance, end of year 1,861,760 29,770 Weighted Average Grant Date Fair Value: Unvested balance, beginning of year $ 34.42 $ 33.48 Granted $ 37.38 $ 37.38 Performance adjustment (1) (2) 24.78 24.71 Vested $ 24.78 $ 24.71 Unvested balance, end of year $ 38.93 $ 38.71 (1) The performance adjustment represents the difference between the number of performance shares granted and earned, which vested following the end of the performance period. The performance shares were granted at the maximum level of achievement. (2) The performance adjustment represents the change in PSUs, which vested following the end of the performance period. The performance units were granted at the target level of achievement. The following table presents the weighted average grant date fair values of performance awards granted. Year Ended December 31, 2021 2020 2019 Performance awards 685,104 557,204 696,360 Weighted average grant date fair value $ 37.38 $ 44.17 $ 36.05 The issuance of share-based awards and amortization thereon has no effect on the Company’s consolidated shareholders’ equity. Share-Based Compensation Expense The following tables present pre-tax and after-tax share-based compensation expense recognized as well as the unrecognized compensation cost associated with unvested awards and the weighted average period over which it is expected to be recognized. Year Ended December 31, 2021 2020 2019 Pre-Tax Stock options and SARs $ 12,316 $ 11,744 $ 12,866 Restricted share and unit awards 46,817 41,284 38,988 Performance awards 23,696 14,729 8,949 ESPP 3,751 2,135 3,045 Total $ 86,580 $ 69,892 $ 63,848 After-Tax Stock options and SARs $ 10,927 $ 10,388 $ 11,450 Restricted share and unit awards 39,349 34,599 32,999 Performance awards 21,920 13,380 8,295 ESPP 3,471 1,978 2,758 Total $ 75,667 $ 60,345 $ 55,502 December 31, 2021 Stock Options and SARs Restricted Common Performance Common Shares and Units Unrecognized compensation cost related to unvested awards $ 8,233 $ 45,936 $ 7,635 Weighted average recognition period (years) 0.91 1.23 0.52 |
Retirement Plans
Retirement Plans | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
Retirement Plans | For purposes of providing employees with retirement benefits, the Company maintains defined contribution retirement plans. Contributions are based on the participants’ eligible compensation. For 2021, 2020 and 2019, the Company expensed $60.4 million, $52.0 million and $44.8 million, respectively, related to these retirement plans. |
Legal Proceedings
Legal Proceedings | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Legal Proceedings [Abstract] | |
Legal Proceedings | The Company, in common with the insurance industry in general, is subject to litigation and arbitration in the normal course of its business. As of December 31, 2021, the Company was not a party to any litigation or arbitration which is expected by management to have a material adverse effect on the Company’s results of operations and financial condition and liquidity. |
Statutory Information
Statutory Information | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Statutory Information [Abstract] | |
Statutory Information | The Company’s insurance and reinsurance subsidiaries are subject to insurance and/or reinsurance laws and regulations in the jurisdictions in which they operate. These regulations include certain restrictions on the amount of dividends or other distributions available to shareholders without prior approval of the insurance regulatory authorities. The actual and required statutory capital and surplus for the Company’s principal operating subsidiaries at December 31, 2021 and 2020: December 31, 2021 2020 Actual capital and surplus (1): Bermuda $ 17,528,510 $ 17,390,943 Ireland 958,200 883,337 United States 5,600,652 4,904,840 United Kingdom 902,002 967,440 Canada 70,063 64,286 Australia 283,693 64,507 Required capital and surplus: Bermuda $ 5,661,301 $ 5,234,121 Ireland 794,933 701,161 United States 1,717,646 1,644,324 United Kingdom 563,164 601,662 Canada 42,513 37,441 Australia 214,022 19,370 (1) Such amounts include ownership interests in affiliated insurance and reinsurance subsidiaries. There were no state-prescribed or permitted regulatory accounting practices for any of the Company’s insurance or reinsurance entities that resulted in reported statutory surplus that differed from that which would have been reported under the prescribed practices of the respective regulatory authorities, including the National Association of Insurance Commissioners. The differences between statutory financial statements and statements prepared in accordance with GAAP vary by jurisdiction, however, with the primary differences being that statutory financial statements may not reflect deferred acquisition costs, certain net deferred tax assets, goodwill and intangible assets, unrealized appreciation or depreciation on debt securities and certain unauthorized reinsurance recoverables and include contingency reserves. The statutory net income (loss) for the Company’s principal operating subsidiaries for 2021, 2020 and 2019 was as follows: Year Ended December 31, 2021 2020 2019 Statutory net income (loss): Bermuda $ 2,370,746 $ 1,579,889 $ 1,801,486 Ireland 25,191 18,397 26,367 United States 345,790 143,271 481,188 United Kingdom 35,286 4,078 (17,423) Canada 6,985 (1,049) (1,023) Australia 11,874 (8,601) (6,199) Bermuda Under the Bermuda Insurance Act 1978 and related regulations, each as amended (the “Insurance Act”), Arch Re Bermuda, the Company’s Bermuda reinsurance and insurance subsidiary, is registered as a Class 4 insurer and long-term insurer and is required to maintain minimum statutory capital and surplus equal to the greater of a minimum solvency margin and the enhanced capital requirement (“ECR”) as determined by the Bermuda Monetary Authority (“BMA”). The ECR is calculated based on the Bermuda Solvency Capital Requirement model, a risk-based model that takes into account the risk characteristics of different aspects of the company’s business. At December 31, 2021 and 2020, the actual and required capital and surplus were based on the economic balance sheet requirements. Under the Insurance Act, Arch Re Bermuda is restricted with respect to the payment of dividends. Arch Re Bermuda is prohibited from declaring or paying in any financial year dividends of more than 25% of its total statutory capital and surplus (as shown on its previous financial year’s statutory balance sheet) unless it files, at least seven days before payment of such dividends, with the BMA an affidavit stating that it will continue to meet the required margins following the declaration of those dividends. Accordingly, Arch Re Bermuda can pay approximately $3.8 billion to Arch Capital during 2022 without providing an affidavit to the BMA. Ireland The Company has three Irish subsidiaries: Arch Re Europe, an authorized life and non-life reinsurer, Arch Insurance (EU), an authorized non-life insurer and Arch Underwriting Europe, a registered insurance and reinsurance intermediary. Irish authorized reinsurers and insurers, such as Arch Re Europe, Arch Insurance (EU) and Irish intermediaries, such as Arch Underwriters Europe, are also subject to the general body of Irish laws and regulations including the provisions of the Companies Act 2014. As part of the Company’s Brexit plan, Arch Insurance (EU) received approval from the Central Bank of Ireland (“CBOI”) to expand the nature of its business in 2019 commenced writing insurance lines in the European Economic Area in 2020, and the Part VII Transfer was completed at the end of December 2020. Arch Re Europe, Arch Insurance (EU) and Arch Underwriters Europe are subject to the supervision of the CBOI and must comply with Irish insurance acts and regulations as well as with directions and guidance issued by the CBOI. Arch Re Europe and Arch Insurance (EU) are required to maintain a minimum level of capital. At December 31, 2021 and 2020, these requirements were met. The amount of dividends these subsidiaries are permitted to declare is limited to accumulated, realized profits, so far as not previously utilized by distribution or capitalization, less its accumulated, realized losses, so far as not previously written off in a reduction or reorganization of capital duly made. The solvency and capital requirements must still be met following any distribution. Dividends or distributions, if any, made by Arch Re Europe would result in an increase in available capital at Arch Re Bermuda. United States The Company’s U.S. insurance and reinsurance subsidiaries are subject to insurance laws and regulations in the jurisdictions in which they operate. The ability of the Company’s regulated insurance subsidiaries to pay dividends or make distributions is dependent on their ability to meet applicable regulatory standards. These regulations include restrictions that limit the amount of dividends or other distributions, such as loans or cash advances, available to shareholders without prior approval of the insurance regulatory authorities. Dividends or distributions, if any, made by Arch Re U.S. would result in an increase in available capital at Arch-U.S., the Company’s U.S. holding company. Arch Re U.S. can declare a maximum of approximately $217.5 million of dividends during 2022 subject to the approval of the Commissioner of the Delaware Department of Insurance. AMIC and UGRIC have each been approved as an eligible mortgage insurer by Fannie Mae and Freddie Mac, subject to maintaining certain ongoing requirements (“eligible mortgage insurers”). In April 2015, the GSEs published comprehensive, revised requirements, known as the Private Mortgage Insurer Eligibility Requirements or “PMIERs.” As clarified and revised by the Guidance Letters issued by the GSEs in December 2016 and March 2017, the PMIERs apply to the Company’s eligible mortgage insurers, but do not apply to Arch Mortgage Guaranty Company, which is not GSE-approved. The amount of assets required to satisfy the revised financial requirements of the PMIERs at any point in time will be affected by many factors, including macro-economic conditions, the size and composition of our eligible mortgage insurers’ mortgage insurance portfolio at the point in time, and the amount of risk ceded to reinsurers that may be deducted in our calculation of “minimum required assets.” The Company’s U.S. mortgage insurance subsidiaries are subject to detailed regulation by their domiciliary and primary regulators, the Wisconsin Office of the Commissioner of Insurance (“Wisconsin OCI”) for AMIC and Arch Mortgage Guaranty Company, the North Carolina Department of Insurance (“NC DOI”) for UGRIC, and by state insurance departments in each state in which they are licensed. As mandated by state insurance laws, mortgage insurers are generally mono-line companies restricted to writing a single type of insurance business, such as mortgage insurance business. Each company is subject to either Wisconsin or North Carolina statutory requirements as to payment of dividends. Generally, both Wisconsin and North Carolina law precludes any dividend before giving at least 30 days’ notice to the Wisconsin OCI or NC DOI, as applicable, and prohibits paying any dividend unless it is fair and reasonable to do so. In addition, the state regulators and the GSEs limit or restrict our eligible mortgage insurers’ ability to pay stockholder dividends or otherwise return capital to shareholders. Under respective states law, our U.S. mortgage subsidiaries can declare a maximum of approximately $194.1 million of ordinary dividends in 2022, however, dividend capacity is limited by the respective companies unassigned surplus amounts. In certain instances, approval by the GSEs would be required for dividends or other forms of return of capital to shareholders due to the requirements under PMIERs, including the minimum required assets imposed on our eligible mortgage insurers by the GSEs. Such dividend would result in an increase in available capital at Arch U.S. MI Holdings Inc., a subsidiary of Arch-U.S. Mortgage insurance companies licensed in Wisconsin or North Carolina are required to establish contingency loss reserves for purposes of statutory accounting in an amount equal to at least 50% of net earned premiums. These amounts generally cannot be withdrawn for a period of 10 years and are separate liabilities for statutory accounting purposes, which affects the ability to pay dividends. However, with prior regulatory approval, a mortgage insurance company may make early withdrawals from the contingency reserve when incurred losses exceed 35% of net premiums earned in a calendar year. Under Wisconsin and North Carolina law, as well as that of 14 other states, a mortgage insurer must maintain a minimum amount of statutory capital relative to its risk in force in order for the mortgage insurer to continue to write new business. While formulations of minimum capital vary in certain jurisdictions, the most common measure applied allows for a maximum risk-to-capital ratio of 25 to 1. Wisconsin and North Carolina both require a mortgage insurer to maintain a “minimum policyholder position” calculated in accordance with their respective regulations. Policyholders' position consists primarily of statutory policyholders' surplus plus the statutory contingency reserve, less ceded reinsurance. While the statutory contingency reserve is reported as a liability on the statutory balance sheet, for risk-to-capital ratio calculations, it is included as capital for purposes of statutory capital. United Kingdom The Prudential Regulation Authority (“PRA”) and the Financial Conduct Authority (“FCA”) regulate insurance and reinsurance companies and the FCA regulates firms carrying on insurance mediation activities operating in the U.K., both under the Financial Services and Markets Act 2000. The Company’s U.K. insurance operations are conducted through Arch Insurance (U.K.), Arch Syndicate 2012 and Arch Syndicate 1955. Arch Managing Agency Limited (“AMAL”) is the managing agent of Arch Syndicate 2012 and Arch Syndicate 1955. Arch Syndicate 2012 and Arch Syndicate 1955 provide access to Lloyd’s extensive distribution network and worldwide licenses. AMAL also acts as managing agent for third party members of Arch Syndicate 1955. All U.K. companies are also subject to a range of statutory provisions, including the laws and regulations of the Companies Acts 2006 (as amended) (the “U.K. Companies Acts”). Arch Insurance (U.K.) and AMAL must maintain a margin of solvency at all times under the Solvency II Directive from the European Insurance and Occupational Pensions Authority. The regulations stipulate that insurers are required to maintain the minimum capital requirement and solvency capital requirement at all times. At December 31, 2021 and 2020, our subsidiaries were in compliance with these requirements. As corporate members of Lloyd’s, AMAL (as managing agent of Arch Syndicate 2012 and Arch Syndicate 1955) and each syndicate’s respective corporate members are subject to the oversight of the Council of Lloyd’s. The capital required to support a Syndicate’s underwriting capacity, or funds at Lloyd’s, is assessed annually and is determined by Lloyd’s in accordance with the capital adequacy rules established by the PRA. The Company has provided capital to support the underwriting of Arch Syndicate 2012 and Arch Syndicate 1955 in the form of pledged assets and letters of credit provided by Arch Re Bermuda. The amount which the Company provides as funds at Lloyd’s is not available for distribution to the Company for the payment of dividends. Lloyd’s is supervised by the PRA and required to implement certain rules prescribed by the PRA under the Lloyd’s Act of 1982 regarding the operation of the Lloyd’s market. With respect to managing agents and corporate members, Lloyd’s prescribes certain minimum standards relating to management and control, solvency and other requirements and monitors managing agents’ compliance with such standards. Under U.K. law, all U.K. companies are restricted from declaring a dividend to their shareholders unless they have “profits available for distribution.” The calculation as to whether a company has sufficient profits is based on its accumulated realized profits minus its accumulated realized losses. U.K. insurance regulatory laws do not prohibit the payment of dividends, but the PRA or FCA, as applicable, requires that insurance companies and insurance intermediaries maintain certain solvency margins and may restrict the payment of a dividend by Arch Insurance (U.K.) and AMAL. Canada Arch Insurance Canada and the Canadian branch of Arch Re U.S. (“Arch Re Canada”) are subject to federal, as well as provincial and territorial, regulation in Canada. The Office of the Superintendent of Financial Institutions (“OSFI”) is the federal regulatory body that, under the Insurance Companies Act (Canada), regulates federal Canadian and non-Canadian insurance companies operating in Canada. Arch Insurance Canada and Arch Re Canada are subject to regulation in the provinces and territories in which they underwrite insurance/reinsurance, and the primary goal of insurance/reinsurance regulation at the provincial and territorial levels is to govern the market conduct of insurance/reinsurance companies. Arch Insurance Canada is licensed to carry on insurance business by OSFI and in each province and territory. Arch Re Canada is licensed to carry-on reinsurance business by OSFI and in the provinces of Ontario and Quebec. Under the Insurance Companies Act (Canada), Arch Insurance Canada is required to maintain an adequate amount of capital in Canada, calculated in accordance with a test promulgated by OSFI called the Minimum Capital Test (“MCT”), and Arch Re Canada is required to maintain an adequate margin of assets over liabilities in Canada, calculated in accordance with a test promulgated by OSFI called the Branch Adequacy of Assets Test. Dividends or distributions, if any, made by Arch Insurance Canada would result in an increase in available capital at Arch Insurance Company (see “—United States” section). Australia The Australian Prudential Regulation Authority (“APRA”) is an independent statutory authority responsible for prudential supervision of institutions across banking, insurance and superannuation and promotes financial stability in Australia. Arch Indemnity has been authorized to conduct monoline lenders’ mortgage insurance business in Australia since June 2002 and was acquired by Arch Capital on August 30, 2021. Arch LMI Pty Ltd. (“Arch LMI”) was authorized by APRA in January 2019 to conduct monoline lenders’ mortgage insurance business in Australia. Major regulatory requirements that are applicable to Arch LMI and Arch Indemnity as general as an insurance providers in Australia include requirements on minimum capital levels and compliance with corporate governance standards, including the risk management strategy for our Australian mortgage insurance business. At December 31, 2021 and 2020, these requirements were met. Arch Capital also conducts property and casualty insurance business in Australia through the Company’s Lloyd’s platform. This insurance business is managed by and distributed through local coverholders and is subject to Lloyd’s Supervision. In addition, the business is subject to local Australian prudential regulatory oversight by APRA, and additional separate financial services market conduct regulation by the Australian Securities and Investments Commission. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent event | Bellemeade Re 2022-1 Ltd . In January 2022, the Company announced that it has obtained over $315 million of indemnity reinsurance on a pool representing approximately $6.3 billion of mortgages from Bellemeade Re 2022-1 Ltd., a special purpose reinsurer. The coverage was obtained by issuing approximately $283.5 million in bonds and $33 million in direct reinsurance. This transaction largely covers a portfolio of policies issued from July through November 2021. Share Repurchases From January 1 to February 25, 2022, the Company repurchased 890,180 common shares for an aggregate purchase price of $41.5 million. At February 25, 2022 approximately $1.14 billion of repurchases were available under the share repurchase program. |
Schedule II - Condensed Financi
Schedule II - Condensed Financial Information of Registrant | 12 Months Ended |
Dec. 31, 2021 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Financial Information of Registrant | SCHEDULE II ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES CONDENSED FINANCIAL INFORMATION OF REGISTRANT (U.S. dollars in thousands) Balance Sheet (Parent Company Only) December 31, 2021 2020 Assets Total investments $ 2,038 $ 172 Cash 16,317 18,932 Investments in subsidiaries 14,822,024 14,377,529 Investment in operating affiliates 6,877 7,731 Due from subsidiaries and affiliates 11 — Other assets 9,604 10,659 Total assets $ 14,856,871 $ 14,415,023 Liabilities Senior notes $ 1,286,208 $ 1,285,867 Due to subsidiaries and affiliates — — Other liabilities 24,767 23,270 Total liabilities 1,310,975 1,309,137 Shareholders' Equity Non-cumulative preferred shares 830,000 780,000 Common shares ($0.0011 par, shares issued: 583,289,850 and 579,000,841) 648 643 Additional paid-in capital 2,085,075 1,977,794 Retained earnings 14,455,868 12,362,463 Accumulated other comprehensive income (loss), net of deferred income tax (64,600) 488,895 Common shares held in treasury, at cost (shares: 204,365,956 and 172,280,199) (3,761,095) (2,503,909) Total shareholders' equity $ 13,545,896 $ 13,105,886 Total liabilities and shareholders' equity $ 14,856,871 $ 14,415,023 The financial information for the parent company (Arch Capital Group Ltd.) should be read in conjunction with the Consolidated Financial Statements and Notes thereto . Statement of Income (Parent Company Only) Year Ended December 31, 2021 2020 2019 Revenues Net investment income $ 1,524 $ 53 $ 212 Net realized gains (losses) — (2,110) — Total revenues 1,524 (2,057) 212 Expenses Corporate expenses 71,818 65,566 62,701 Interest expense 58,741 40,445 22,154 Net foreign exchange (gains) losses 7 3 1 Total expenses 130,566 106,014 84,856 Income (loss) before income taxes and income (loss) from operating affiliates (129,042) (108,071) (84,644) Income (loss) from operating affiliates (590) (437) (762) Income (loss) before equity in net income of subsidiaries (129,632) (108,508) (85,406) Equity in net income of subsidiaries 2,286,481 1,514,029 1,721,725 Net income available to Arch 2,156,849 1,405,521 1,636,319 Preferred dividends (48,343) (41,612) (41,612) Loss on redemption of preferred shares (15,101) — — Net income available to Arch common shareholders $ 2,093,405 $ 1,363,909 $ 1,594,707 The financial information for the parent company (Arch Capital Group Ltd.) should be read in conjunction with the Consolidated Financial Statements and Notes thereto . Statement of Cash Flows (Parent Company Only) Year Ended December 31, 2021 2020 2019 Operating Activities: Net Cash Provided By Operating Activities $ 1,727,529 $ 124,751 $ 52,487 Investing Activities: Net (purchases) sales of short-term investments (1,866) (130) 61 Capital contributed to subsidiaries (487,161) (988,975) (2,121) Purchase of fixed assets (783) (15) (162) Net Cash Used For Investing Activities (489,810) (989,120) (2,222) Financing Activities: Purchases of common shares under share repurchase program (1,234,294) (83,472) (2,871) Proceeds from common shares issued, net 6,418 1,876 6,203 Proceeds from issuance of preferred shares, net 485,821 — — Redemption of preferred shares (450,000) — — Proceeds from borrowings — 988,393 — Preferred dividends paid (48,280) (41,612) (41,612) Net Cash Used For Financing Activities (1,240,335) 865,185 (38,280) Increase (decrease) in cash and restricted cash (2,616) 816 11,985 Cash and restricted cash, beginning of year 18,960 18,144 6,159 Cash and restricted cash, end of period $ 16,344 $ 18,960 $ 18,144 The financial information for the parent company (Arch Capital Group Ltd.) should be read in conjunction with the Consolidated Financial Statements and Notes thereto . |
Schedule III - Supplementary In
Schedule III - Supplementary Insurance Information | 12 Months Ended |
Dec. 31, 2021 | |
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Abstract] | |
Supplementary Insurance Information | SCHEDULE III ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES SUPPLEMENTARY INSURANCE INFORMATION (U.S. dollars in thousands) Deferred Acquisition Costs Reserves for Losses and Loss Adjustment Expenses Unearned Premiums Net Premiums Earned Net Investment Income (1) Net Losses and Loss Adjustment Expenses Incurred Amortization of Deferred Acquisition Costs Other Operating Expenses (2) Net Premiums Written December 31, 2021 Insurance $378,265 $9,810,622 $2,937,664 $3,626,468 NM $2,344,365 $606,265 $558,906 $4,148,193 Reinsurance 424,390 6,878,721 2,263,264 2,840,443 NM 1,924,719 536,754 212,810 3,254,374 Mortgage 99,186 1,067,813 811,014 1,283,419 NM 56,677 97,418 194,010 1,261,068 Other 331,968 NM 259,042 62,741 32,869 354,702 Total $901,841 $17,757,156 $6,011,942 $8,082,298 NM $4,584,803 $1,303,178 $998,595 $9,018,337 December 31, 2020 Insurance $254,833 $8,989,930 $2,334,225 $2,871,420 NM $2,092,453 $418,483 $489,153 $3,162,907 Reinsurance 278,422 5,027,742 1,356,983 2,162,229 NM 1,628,320 354,048 168,011 2,457,370 Mortgage 203,748 976,673 740,043 1,397,935 NM 528,344 134,240 162,202 1,279,850 Other 53,705 1,519,583 407,714 560,351 NM 440,482 98,071 55,810 537,589 Total $790,708 $16,513,928 $4,838,965 $6,991,935 NM $4,689,599 $1,004,842 $875,176 $7,437,716 December 31, 2019 Insurance $188,684 $7,900,328 $1,991,496 $2,397,080 NM $1,615,475 $361,614 $454,770 $2,641,726 Reinsurance 197,856 4,270,013 971,776 1,466,389 NM 1,011,329 239,032 141,484 1,602,723 Mortgage 182,816 457,872 937,370 1,366,340 NM 53,513 134,319 153,092 1,261,756 Other 64,044 1,263,629 438,907 556,689 NM 453,135 105,980 51,651 532,862 Total $633,400 $13,891,842 $4,339,549 $5,786,498 NM $3,133,452 $840,945 $800,997 $6,039,067 (1) The Company does not manage its assets by segment and, accordingly, net investment income is not allocated to each underwriting segment. See note 4, “Segment Information,” to our consolidated financial statements in Item 8 for information related to the ‘other’ segment. (2) Certain other operating expenses relate to the Company’s corporate segment. Such amounts are not reflected in the table above. See note 4, “Segment Information,” to our consolidated financial statements in Item 8 for information related to the corporate segment. |
Schedule IV - Reinsurance
Schedule IV - Reinsurance | 12 Months Ended |
Dec. 31, 2021 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | |
Reinsurance | SCHEDULE IV ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES REINSURANCE (U.S. dollars in thousands) Gross Amount Ceded to Other Companies (1) Assumed From Other Companies (1) Net Percentage of Amount Assumed to Net Year Ended December 31, 2021 Premiums Written: Insurance $ 5,833,873 $ (1,719,541) $ 33,861 $ 4,148,193 0.8 % Reinsurance 408,520 (1,839,556) 4,685,410 3,254,374 144.0 % Mortgage 1,213,333 (246,757) 294,492 1,261,068 23.4 % Other 251,106 (102,763) 206,359 354,702 58.2 % Total $ 7,706,832 $ (3,734,150) $ 5,045,655 $ 9,018,337 55.9 % Year Ended December 31, 2020 Premiums Written: Insurance $ 4,659,416 $ (1,525,655) $ 29,146 $ 3,162,907 0.9 % Reinsurance 305,435 (1,014,716) 3,166,651 2,457,370 128.9 % Mortgage 1,192,316 (194,149) 281,683 1,279,850 22.0 % Other 396,743 (190,957) 331,803 537,589 61.7 % Total $ 6,553,910 $ (2,650,352) $ 3,534,158 $ 7,437,716 47.5 % Year Ended December 31, 2019 Premiums Written: Insurance $ 3,879,752 $ (1,266,267) $ 28,241 $ 2,641,726 1.1 % Reinsurance 238,229 (720,500) 2,084,994 1,602,723 130.1 % Mortgage 1,224,373 (204,509) 241,892 1,261,756 19.2 % Other 339,169 (222,019) 415,712 532,862 78.0 % Total $ 5,681,523 $ (2,099,893) $ 2,457,437 $ 6,039,067 40.7 % (1) Certain amounts included in the gross premiums written of each segment are related to intersegment transactions and are included in the gross premiums written of each segment. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total. |
Schedule VI - Supplementary Inf
Schedule VI - Supplementary Information For Property and Casualty Insurance Underwriters | 12 Months Ended |
Dec. 31, 2021 | |
SEC Schedule, 12-18, Supplemental Information, Property-Casualty Insurance Underwriters [Abstract] | |
Supplementary Information for Property and Casualty Insurance Underwriters | SCHEDULE VI ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES SUPPLEMENTARY INFORMATION FOR PROPERTY AND CASUALTY INSURANCE UNDERWRITERS (U.S. dollars in thousands) Column A Column B Column C Column D Column E Column F Column G Column H Column I Column J Column K Affiliation with Registrant Deferred Acquisition Costs Reserves for Losses and Loss Adjustment Expenses Discount, if any, deducted in Column C Unearned Premiums Net Net Investment Income Net Losses and Loss Adjustment Expenses Incurred Related to Amortization Net Paid Losses and Loss Adjustment Expenses Net (a) Current Year (b) Consolidated Subsidiaries 2021 $ 901,841 $ 17,757,156 $ 55,575 $ 6,011,942 $ 8,082,298 $ 389,118 $ 4,940,987 $ (356,184) $ 1,303,178 $ 2,826,551 $ 9,018,337 2020 790,708 16,513,929 23,326 4,838,965 6,991,935 519,608 4,851,051 (161,452) 1,004,842 2,661,117 7,437,716 2019 633,400 13,891,842 22,012 4,339,549 5,786,498 627,738 3,297,037 (163,585) 840,945 2,383,255 6,039,067 |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of presentation | The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of Arch Capital and its subsidiaries, including Arch Reinsurance Ltd. (“Arch Re Bermuda”), Arch Reinsurance Company (“Arch Re U.S.”), Arch Capital Group (U.S.) Inc.(“Arch-U.S.”), Arch Insurance Company, Arch Specialty Insurance Company, Arch Property & Casualty Insurance Company (“Arch P&C”), Arch Indemnity Insurance Company (“Arch Indemnity Insurance”), Arch Insurance Canada Ltd. (“Arch Insurance Canada”), Arch Reinsurance Europe Designated Activity Company (“Arch Re Europe”), Arch Mortgage Insurance Company (“AMIC”), Arch Mortgage Guaranty Company, United Guaranty Residential Insurance Company (“UGRIC”), Arch Indemnity, Arch Insurance (EU) Designated Activity Company (“Arch Insurance (EU)”), Arch Insurance (U.K.) Limited (“Arch Insurance (U.K.)”) and the Company’s participation on Lloyd’s of London syndicates 2012 (“Arch Syndicate 2012”) and 1955 (“Arch Syndicate 1955”). All significant intercompany transactions and balances have been eliminated in consolidation. |
Use of estimates | The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates and assumptions. The Company’s principal estimates include: • The reserve for losses and loss adjustment expenses; • Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses, including the provision for uncollectible amounts; • Estimates of written and earned premiums; • The valuation of the investment portfolio and assessment of allowance for credit losses; • The valuation of purchased intangible assets; • The assessment of goodwill and intangible assets for impairment; and • The valuation of deferred tax assets. |
Premiums | Insurance. Insurance premiums written are generally recorded at the policy inception and are primarily earned on a pro rata basis over the terms of the policies for all products, usually 12 months. Premiums written include estimates that are derived from multiple sources which include the historical experience of the underlying business, similar business and available industry information. Unearned premium reserves represent the portion of premiums written that relates to the unexpired terms of in-force insurance policies. Reinsurance. Reinsurance premiums written include amounts reported by brokers and ceding companies, supplemented by the Company’s own estimates of premiums where reports have not been received. The determination of premium estimates requires a review of the Company’s experience with the ceding companies, familiarity with each market, the timing of the reported information, an analysis and understanding of the characteristics of each line of business, and management’s judgment of the impact of various factors, including premium or loss trends, on the volume of business written and ceded to the Company. On an ongoing basis, the Company’s underwriters review the amounts reported by these third parties for reasonableness based on their experience and knowledge of the subject class of business, taking into account the Company’s historical experience with the brokers or ceding companies. In addition, reinsurance contracts under which the Company assumes business generally contain specific provisions which allow the Company to perform audits of the ceding company to ensure compliance with the terms and conditions of the contract, including accurate and timely reporting of information. Based on a review of all available information, management establishes premium estimates where reports have not been received. Premium estimates are updated when new information is received and differences between such estimates and actual amounts are recorded in the period in which estimates are changed or the actual amounts are determined. Reinsurance premiums written are recorded based on the type of contracts the Company writes. Premiums on the Company’s excess of loss and pro rata reinsurance contracts are estimated when the business is underwritten. For excess of loss contracts, premiums are recorded as written based on the terms of the contract. Estimates of premiums written under pro rata contracts are recorded in the period in which the underlying risks are expected to incept and are based on information provided by the brokers and the ceding companies. For multi-year reinsurance treaties which are payable in annual installments, generally, only the initial annual installment is included as premiums written at policy inception due to the ability of the reinsured to commute or cancel coverage during the term of the policy. The remaining annual installments are included as premiums written at each successive anniversary date within the multi-year term. Reinsurance premiums written, irrespective of the class of business, are generally earned on a pro rata basis over the terms of the underlying policies or reinsurance contracts. Contracts and policies written on a “losses occurring” basis cover claims that may occur during the term of the contract or policy, which is typically 12 months. Accordingly, the premium is earned evenly over the term. Contracts which are written on a “risks attaching” basis cover claims which attach to the underlying insurance policies written during the terms of such contracts. Premiums earned on such contracts usually extend beyond the original term of the reinsurance contract, typically resulting in recognition of premiums earned over a 24-month period. Certain of the Company’s reinsurance contracts include provisions that adjust premiums or acquisition expenses based upon the experience under the contracts. Premiums written and earned, as well as related acquisition expenses, are recorded based upon the projected experience under such contracts. The Company also writes certain reinsurance business that is intended to provide insurers with risk management solutions that complement traditional reinsurance. Under these contracts, the Company assumes a measured amount of insurance risk in exchange for an anticipated margin, which is typically lower than on traditional reinsurance contracts. The terms and conditions of these contracts may include additional or return premiums based on loss experience, loss corridors, sublimits and caps. Examples of such business include aggregate stop-loss coverages, financial quota share coverages and multi-year retrospectively rated excess of loss coverages. If these contracts are deemed to transfer risk, they are accounted for as reinsurance. Otherwise, such contracts are accounted for under the deposit method. Mortgage. Mortgage guaranty insurance policies are contracts that are generally non-cancelable by the insurer, are renewable at a fixed price, and provide for payment of premiums on a monthly, annual or single basis. Upon renewal, the Company is not able to re-underwrite or re-price its policies. Consistent with industry accounting practices, premiums written on a monthly basis are earned as coverage is provided. Premiums written on an annual basis are amortized on a monthly pro rata basis over the year of coverage. Primary mortgage insurance premiums written on policies covering more than one year are referred to as single premiums. A portion of the revenue from single premiums is recognized in premiums earned in the current period, and the remaining portion is deferred as unearned premiums and earned over the estimated expiration of risk of the policy. If single premium policies related to insured loans are canceled due to repayment by the borrower and the policy is a non-refundable product, the remaining unearned premium related to each canceled policy is recognized as earned premium upon notification of the cancellation. Reinstatement premiums for the Company’s insurance and reinsurance operations are recognized at the time a loss event occurs, where coverage limits for the remaining life of the contract are reinstated under pre-defined contract terms. Reinstatement premiums, if obligatory, are fully earned when recognized. The accrual of reinstatement premiums is based on an estimate of losses and loss adjustment expenses, which reflects management’s judgment. Premium estimates are reviewed by management at least quarterly. Such review includes a comparison of actual reported premiums to expected ultimate premiums along with a review of the aging and collection of premium estimates. Based on management’s review, the appropriateness of the premium estimates is evaluated, and any adjustment to these estimates is recorded in the period in which it becomes known. Adjustments to premium estimates could be material and such adjustments could directly and significantly impact earnings favorably or unfavorably in the period they are determined because the estimated premium may be fully or substantially earned. A significant portion of amounts included as premiums receivable, which represent estimated premiums written, net of commissions, are not currently due based on the terms of the underlying contracts. Unearned premiums represent the portion of premiums written that is applicable to the estimated unexpired risk of insured loans. A portion of premium payments may be refundable if the insured cancels coverage, which generally occurs when the loan is repaid, the loan amortizes to a sufficiently low amount to trigger a lender permitted or legally required cancellation, or the value of the property has increased sufficiently in accordance with the terms of the contract. Premium refunds reduce premiums earned in the consolidated statements of income. Generally, only unearned premiums are refundable. Premiums receivable include amounts receivable from agents, brokers and insured that are both currently due and amounts not yet due on insurance, reinsurance and mortgage insurance policies. Premiums receivable balances are reported net of an allowance for expected credit losses. The Company monitors credit risk associated with premiums receivable through its ongoing review of amounts outstanding, aging of the receivable, historical loss data, and counterparty financial strength measures. The allowance also includes estimated uncollectible amounts related to dispute risk. In certain instances, credit risk may be reduced by the Company’s right to offset loss obligations or unearned premiums against premiums receivable. Any allowance for credit losses is charged to net realized gains (losses) in the period the receivable is recorded and revised in subsequent periods to reflect changes in the Company’s estimate of expected credit losses. See note 7, “Allowance for Expected Credit Losses” for additional information. |
Acquisition costs | Acquisition Costs. Acquisition costs that are directly related and incremental to the successful acquisition or renewal of business are deferred and amortized based on the type of contract. The Company’s insurance and reinsurance operations capitalize incremental direct external costs that result from acquiring a contract but do not capitalize salaries, benefits and other internal underwriting costs. For the Company’s mortgage insurance operations, which include a substantial direct sales force, both external and certain internal direct costs are deferred and amortized. For property and casualty insurance and reinsurance contracts, deferred acquisition costs are amortized over the period in which the related premiums are earned. Consistent with mortgage insurance industry accounting practice, amortization of acquisition costs related to the mortgage insurance contracts for each underwriting year’s book of business is recorded in proportion to estimated gross profits. Estimated gross profits are comprised of earned premiums and losses and loss adjustment expenses. For each underwriting year, the Company estimates the rate of amortization to reflect actual experience and any changes to persistency or loss development. Deferred acquisition costs are carried at their estimated realizable value and take into account anticipated losses and loss adjustment expenses, based on historical and current experience, and anticipated investment income. A premium deficiency occurs if the sum of anticipated losses and loss adjustment expenses, unamortized acquisition costs and maintenance costs exceed unearned premiums (including expected future premiums) and anticipated investment income. A premium deficiency reserve (“PDR”) is recorded by charging any unamortized acquisition costs to expense to the extent required in order to eliminate the deficiency. If the premium deficiency exceeds unamortized acquisition costs then a liability is accrued for the excess deficiency. To assess the need for a PDR on mortgage exposures, the Company develops loss projections based on modeled loan defaults related to its current policies in force. This projection is based on recent trends in default experience, severity and rates of defaulted loans moving to claim, as well as recent trends in the rate at which loans are prepaid, and incorporates anticipated interest income. Evaluating the expected profitability of the Company’s existing mortgage insurance business and the need for a PDR for its mortgage business involves significant reliance upon assumptions and estimates with regard to the likelihood, magnitude and timing of potential losses and premium revenues. No premium deficiency charges were recorded by the Company during 2021, 2020 or 2019. |
Deposit accounting | Certain assumed reinsurance contracts that are deemed not to transfer insurance risk, are accounted for using the deposit method of accounting. However, it is possible that the Company could incur financial losses on such contracts. Management exercises significant judgment in the assumptions used in determining whether assumed contracts should be accounted for as reinsurance contracts or deposit contracts. For those contracts that contain only significant underwriting risk, the estimated profit margin is deferred and amortized over the contract period and such amount is included in the Company’s underwriting results. When the estimated profit margin is explicit, the margin is reflected as other underwriting income and any adverse financial results on such contracts are reflected as incurred losses. When the estimated profit margin is implicit, the margin is reflected as an offset to paid losses and any adverse financial results on such contracts are reflected as incurred losses. Additional judgments are required when applying the accounting guidance with respect to the revenue recognition criteria for contracts deemed to transfer only significant underwriting risk. For those contracts that contain only significant timing risk, an accretion rate is established at inception of the contract based on actuarial estimates whereby the deposit accounting liability is increased to the estimated amount payable over the contract term. The accretion on the deposit is based on the expected rate of return required to fund the expected future payment obligations. Periodically the Company reassesses the estimated ultimate liability and the related expected rate of return. The accretion of the deposit accounting liability as well as changes to the estimated ultimate liability and the accretion rate would be reflected as part of interest expense in the Company’s results of operations. Any negative accretion in a deposit accounting liability is shown in other underwriting income in the Company’s results of operations. Under some of these contracts, the ceding company retains the related assets on a funds-held basis. Such amounts are included in “Other assets” on the Company’s balance sheet. Interest income produced by those assets are recorded as part of net investment income in the Company's results of operations. |
Retroactive accounting | Retroactive reinsurance reimburses a ceding company for liabilities incurred as a result of past insurable events covered by the underlying policies reinsured. In certain instances, reinsurance contracts cover losses both on a prospective basis and on a retroactive basis and, accordingly, the Company bifurcates the prospective and retrospective elements of these reinsurance contracts and accounts for each element separately where practical. Underwriting income generated in connection with retroactive reinsurance contracts is deferred and amortized into income over the settlement period while losses are charged to income immediately. Subsequent changes in estimated amount or timing of cash flows under such retroactive reinsurance contracts are accounted for by adjusting the previously deferred amount to the balance that would have existed had the revised estimate been available at the inception of the reinsurance transaction, with a corresponding charge or credit to income. |
Reinsurance ceded | In the normal course of business, the Company purchases reinsurance to increase capacity and to limit the impact of individual losses and events on its underwriting results by reinsuring certain levels of risk with other insurance enterprises or reinsurers. The Company uses pro rata, excess of loss and facultative reinsurance contracts. Reinsurance ceding commissions that represent a recovery of acquisition costs are recognized as a reduction to acquisition costs while the remaining portion is deferred. The accompanying consolidated statement of income reflects premiums and losses and loss adjustment expenses and acquisition costs, net of reinsurance ceded. See note 8, “Reinsurance” for information on the Company's reinsurance usage. Reinsurance premiums ceded and unpaid losses and loss adjustment expenses recoverable are estimated in a manner consistent with that of the original policies issued and the terms of the reinsurance contracts. If the reinsurers are unable to satisfy their obligations under the agreements, the Company’s insurance or reinsurance subsidiaries would be liable for such defaulted amounts. Reinsurance recoverables are recorded as assets, predicated on the reinsurers’ ability to meet their obligations under the reinsurance agreements. In certain instances, the Company obtains collateral, including letters of credit and trust accounts to further reduce the credit exposure on its reinsurance recoverables. The Company reports its reinsurance recoverables net of an allowance for expected credit loss. The allowance is based upon the Company’s ongoing review of amounts outstanding, the financial condition of its reinsurers, amounts and form of collateral obtained and other relevant factors. A ratings based probability-of-default and loss-given-default methodology is used to estimate the allowance for expected credit loss. Any allowance for credit losses is charged to net realized gains (losses) in the period the recoverable is recorded and revised in s ubsequent periods to reflect changes in the Company’s estimate of expected credit losses . See note 7, “Allowance for Expected Credit Losses” for additional information. |
Cash | Cash includes cash equivalents, which are investments with original maturities of three months or less which are not part of the investment portfolio. |
Restricted cash | Restricted cash represents amounts held for the benefit of third parties and is legally or contractually restricted as to withdrawal or usage by the Company. Such amounts are included in “Other assets” on the Company’s balance sheet. |
Investments | The Company currently classifies substantially all of its fixed maturity investments and short-term investments as “available for sale” and, accordingly, they are carried at estimated fair value (also known as fair value) with the changes in fair value recorded as an unrealized gain or loss component of accumulated other comprehensive income in shareholders’ equity. The fair value of fixed maturity securities and equity securities is generally determined from quotations received from nationally recognized pricing services, or when such prices are not available, by reference to broker or underwriter bid indications. Short-term investments comprise securities due to mature within one year of the date of issue. Short-term investments include certain cash equivalents which are part of investment portfolios under the management of external and internal investment managers. Prior to the termination of its program in 2021, the Company entered into securities lending agreements with financial institutions to enhance investment income whereby it loaned certain of its securities to third parties, primarily major brokerage firms, for short periods of time through a lending agent. Such securities have been reclassified as “Securities pledged under securities lending, at fair value.” The Company maintained legal control over the securities it lent, retained the earnings and cash flows associated with the loaned securities and received a fee from the borrower for the temporary use of the securities. Collateral received was required at a rate of 102% or greater of the fair value of the loaned securities including accrued investment income and was monitored and maintained by the lending agent. Such collateral is reflected as “Collateral received under securities lending, at fair value.” The Company’s investment portfolio includes certain funds that, due to their ownership structure, are accounted for by the Company using the equity method. In applying the equity method, these investments are initially recorded at cost and are subsequently adjusted based on the Company’s proportionate share of the net income or loss of the funds (which include changes in the fair value of the underlying securities in the funds). Such investments are generally recorded on a one three The Company’s investment portfolio includes equity securities that are accounted for at fair value. Such holdings primarily include publicly traded common stocks. Dividend income on equities is reflected in net investment income. Changes in fair value on equity securities are included in “Net realized gains (losses)” in the consolidated statement of income. The Company elected to carry certain fixed maturity securities, equity securities, short-term investments and other investments at fair value under the fair value option afforded by accounting guidance regarding the fair value option for financial assets and liabilities. The fair value for certain of the Company’s other investments are determined using net asset values (“NAVs”) as advised by external fund managers. The NAV is based on the fund manager’s valuation of the underlying holdings in accordance with the fund’s governing documents. Changes in fair value of investments accounted for using the fair value option are included in “Net realized gains (losses).” The primary reasons for electing the fair value option were to address simplification and cost-benefit considerations. The Company invests in reverse repurchase agreements that are generally treated as collateralized receivables. Receivables for reverse repurchase agreements are reflected in “Other investments” or “Short-term investments” in the Company's consolidated balance sheet depending on their terms. These agreements are recorded at their contracted resale amount plus accrued interest, other than those that are accounted for at fair value. In reverse repurchase transactions, the Company obtains an interest in the purchased assets that are received as collateral. The Company invests in limited partner interests and shares of limited liability companies. Such amounts are included in investments accounted for using the equity method and other investments. These investments can often have characteristics of a variable interest entity (“VIE”). A VIE refers to entities that have characteristics such as (i) insufficient equity at risk to allow the entity to finance its activities without additional financial support or (ii) instances where the equity investors, as a group, do not have the characteristic of a controlling financial interest. If the Company is determined to be the primary beneficiary, it is required to consolidate the VIE. The primary beneficiary is defined as the variable interest holder that is determined to have the controlling financial interest as a result of having both (i) the power to direct the activities of a VIE that most significantly impact the economic performance of the VIE and (ii) the obligation to absorb losses or right to receive benefits from the VIE that could potentially be significant to the VIE. At inception of the VIE as well as on an ongoing basis, the Company determines whether it is the primary beneficiary based on an analysis of the Company’s level of involvement in the VIE, the contractual terms, and the overall structure of the VIE. The Company's maximum exposure to loss with respect to these investments is limited to the investment carrying amounts reported in the Company's consolidated balance sheet and any unfunded commitment. The Company conducts a periodic review to identify and evaluate credit based impairments related to the Company’s available for sale investments. The Company derives estimated credit losses by comparing expected future cash flows to be collected to the amortized cost of the security. Estimates of expected future cash flows consider among other things, macroeconomic conditions as well as the financial condition, near-term and long-term prospects for the issuer, and the likelihood of the recoverability of principal and interest. Effective January 1, 2020, credit losses are recognized through an allowance account subject to reversal, rather than a reduction in amortized cost. Declines in value attributable to factors other than credit are reported in other comprehensive income while the allowance for credit loss is charged to net realized gains (losses). For available for sale investments that the Company intends to sell or for which it is more likely than not that the Company would be required to sell before an anticipated recovery in value, the full amount of the impairment is included in net realized gains (losses). The new cost basis of the investment is the previous amortized cost basis reduced by the impairment recognized in net realized gains (losses). The new cost basis is not adjusted for any subsequent recoveries in fair value. The Company reports accrued investment income separately from investment balances and has elected not to measure an allowance for credit losses for accrued investment income . Any uncollectible accrued interest income is written off in the period it is deemed uncollectible. Prior to January 1, 2020, the Company performed quarterly reviews of its investments to determine whether declines in fair value below the cost basis were considered other-than-temporary in accordance with applicable accounting guidance regarding the recognition and presentation of OTTI. The process of determining whether a security was other-than-temporarily impaired required judgment and involved analyzing many factors. These factors included (i) an analysis of the liquidity, business prospects and overall financial condition of the issuer, (ii) the time period in which there was a significant decline in value, (iii) the significance of the decline and (iv) the analysis of specific credit events. When there were credit-related losses associated with debt securities for which the Company did not have an intent to sell and it was more likely than not that it would not be required to sell the security before recovery of its cost basis, the amount of the OTTI related to a credit loss was recognized in earnings and the amount of the OTTI related to other factors ( e.g. , interest rates, market conditions, etc.) was recorded as a component of other comprehensive income (loss). The amount of the credit loss of an impaired debt security was the difference between the amortized cost and the greater of (i) the present value of expected future cash flows and (ii) the fair value of the security. In instances where no credit loss existed but it was more likely than not that the Company would have to sell the debt security prior to the anticipated recovery, the decline in fair value below amortized cost was recognized as an OTTI in earnings. In periods after the recognition of an OTTI on debt securities, the Company accounted for such securities as if they had been purchased on the measurement date of the OTTI at an amortized cost basis equal to the previous amortized cost basis less the OTTI recognized in earnings. For debt securities for which OTTI were recognized in earnings, the difference between the new amortized cost basis and the cash flows expected to be collected would be accreted or amortized into net investment income. See note 9, “Investment Information” for additional information. Net investment income includes interest and dividend income together with amortization of market premiums and discounts and is net of investment management and custody fees. Anticipated prepayments and expected maturities are used in applying the interest method for certain investments such as mortgage and other asset-backed securities. When actual prepayments differ significantly from anticipated prepayments, the effective yield is recalculated to reflect actual payments to date and anticipated future payments. The net investment in such securities is adjusted to the amount that would have existed had the new effective yield been applied since the acquisition of the security. Such adjustments, if any, are included in net investment income when determined. Investment gains or losses realized on the sale of investments, except for certain fund investments, are determined on a first-in, first-out basis and are reflected in net income. Investment gains or losses realized on the sale of certain fund investments are determined on an average cost basis. Unrealized appreciation or decline in the value of available for sale securities, which are carried at fair value, is excluded from net income and recorded as a separate component of accumulated other comprehensive income, net of applicable deferred income tax. |
Derivative instruments | The Company recognizes all derivative instruments, including embedded derivative instruments, at fair value in its consolidated balance sheets. The Company employs the use of derivative instruments within its operations to mitigate risks arising from assets and liabilities held in foreign currencies as well as part of its overall investment strategy. For such instruments, changes in assets and liabilities measured at fair value are recorded as “Net realized gains” in the consolidated statements of income. In addition, the Company’s derivative instruments include amounts related to underwriting activities where an insurance or reinsurance contract meets the accounting definition of a derivative instrument. For such contracts, changes in fair value are reflected in “Other underwriting income” in the consolidated statements of income as the underlying contract originates from the Company’s underwriting operations. For the periods ended 2021, 2020, and 2019, the Company did not designate any derivative instruments as hedges under the relevant accounting guidance. See note 11, “Derivative Instruments” for additional information. |
Reserves for losses and loss adjustment expenses | Insurance and Reinsurance. The reserve for losses and loss adjustment expenses consists of estimates of unpaid reported losses and loss adjustment expenses and estimates for losses incurred but not reported. The reserve for unpaid reported losses and loss adjustment expenses, established by management based on reports from ceding companies and claims from insureds, excludes estimates of amounts related to losses under high deductible policies, and represents the estimated ultimate cost of events or conditions that have been reported to or specifically identified by the Company. Such reserves are supplemented by management’s estimates of reserves for losses incurred for which reports or claims have not been received. The Company’s reserves are based on a combination of reserving methods, incorporating both Company and industry loss development patterns. The Company selects the initial expected loss and loss adjustment expense ratios based on information derived by its underwriters and actuaries during the initial pricing of the business, supplemented by industry data where appropriate. Such ratios consider, among other things, rate changes and changes in terms and conditions that have been observed in the market. These estimates are reviewed regularly and, as experience develops and new information becomes known, the reserves are adjusted as necessary. Such adjustments, if any, are reflected in income in the period in which they are determined. As actual loss information has been reported, the Company has developed its own loss experience and its reserving methods include other actuarial techniques. Over time, such techniques have been given further weight in its reserving process based on the continuing maturation of the Company’s reserves. Inherent in the estimates of ultimate losses and loss adjustment expenses are expected trends in claims severity and frequency and other factors which may vary significantly as claims are settled. Accordingly, ultimate losses and loss adjustment expenses may differ materially from the amounts recorded in the accompanying consolidated financial statements. Losses and loss adjustment expenses are recorded on an undiscounted basis, except for excess workers’ compensation and employers’ liability business written by the Company’s insurance operations. Mortgage. The reserves for mortgage guaranty insurance losses and loss adjustment expenses are the estimated claim settlement costs on notices of delinquency that have been received by the Company, as well as loan delinquencies that have been incurred but have not been reported by the lenders. Consistent with primary mortgage insurance industry accounting practice, the Company does not establish loss reserves for future claims on insured loans that are not currently delinquent (defined as two or more payments in arrears). The Company establishes loss reserves on a case-by-case basis when insured loans are reported delinquent using estimated claim rates and average claim sizes for each cohort, net of any salvage recoverable. The Company also reserves for delinquencies that have occurred but have not yet been reported to the Company prior to the close of an accounting period. To determine this reserve, the Company estimates the number of delinquencies not yet reported using historical information regarding late reported delinquencies and applies estimated claim rates and claim sizes for the estimated delinquencies not yet reported. The establishment of reserves across the Company’s segments is an inherently uncertain process, are necessarily |
Contractholders receivables and payables | Certain insurance policies written by the Company’s U.S. insurance operations feature large deductibles, primarily in its construction and national accounts line of business. Under such contracts, the Company is obligated to pay the claimant for the full amount of the claim. The Company is subsequently reimbursed by the policy holder for the deductible amount. These amounts are included on a gross basis in the consolidated balance sheet as contractholder payables and contractholder receivables. In the event that the Company is unable to collect from the policyholder, the Company would be liable for such defaulted amounts. Collateral, primarily in the form of letters of credit, cash and trusts, is obtained from the policyholder to mitigate the Company’s credit risk. In the instances where the Company receives collateral in the form of cash, the Company reflects it in “Collateral held for insured obligations.” Contractholder receivables are reported net of an allowance for expected credit losses. The allowance is based upon the Company’s ongoing review of amounts outstanding, changes in policyholder credit standing, amounts and form of collateral obtained, and other relevant factors. A ratings based probability-of-default and loss-given-default methodology is used to estimate the allowance for expected credit losses. Any allowance for credit losses is charged to net realized gains (losses) in the period the receivable is recorded and revised in subsequent periods to reflect changes in the Company’s estimate of expected credit losses . See note 7, “Allowance for Expected Credit Losses” for additional information. |
Foreign exchange | Assets and liabilities of foreign operations whose functional currency is not the U.S. Dollar are translated at the prevailing exchange rates at each balance sheet date. Revenues and expenses of such foreign operations are translated at average exchange rates during the year. The net effect of the translation adjustments for foreign operations is included in accumulated other comprehensive income, net of applicable deferred income tax. Monetary assets and liabilities, such as premiums receivable and the reserve for losses and loss adjustment expenses, denominated in foreign currencies are revalued at the exchange rate in effect at the balance sheet date with the resulting foreign exchange gains and losses included in net income. Accounts that are classified as non-monetary, such as deferred acquisition costs and the unearned premium reserves, are not revalued. In the case of foreign currency denominated fixed maturity securities which are classified as “available for sale,” the change in exchange rates between the local currency in which the investments are denominated and the Company’s functional currency at each balance sheet date is included in unrealized appreciation or decline in value of securities, a component of accumulated other comprehensive income, net of applicable deferred income tax. |
Income taxes | Deferred income taxes reflect the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and amounts used for income tax purposes. A valuation allowance is recorded if it is more likely than not that some or all of a deferred tax asset may not be realized. The Company considers future taxable income and feasible tax planning strategies in assessing the need for a valuation allowance. In the event the Company determines that it will not be able to realize all or part of its deferred income tax assets in the future, an adjustment to the deferred income tax assets would be charged to income in the period in which such determination is made. In addition, if the Company subsequently assesses that the valuation allowance is no longer needed, a benefit would be recorded to income in the period in which such determination is made. See note 15, “Income Taxes” for additional information. The Company recognizes a tax benefit where it concludes that it is more likely than not that the tax benefit will be sustained on audit by the taxing authority based solely on the technical merits of the associated tax position. If the recognition threshold is met, the Company recognizes a tax benefit measured at the largest amount of the tax benefit that, in the Company’s judgment, is greater than 50% likely to be realized. The Company records interest and penalties related to unrecognized tax benefits in the provision for income taxes. |
Share-based payment arrangements | The Company applies a fair value based measurement method in accounting for its share-based payment arrangements with eligible employees and directors. Compensation expense is estimated based on the fair value of the award at the grant date and is recognized in net income over the requisite service period with a corresponding increase in shareholders’ equity. No value is attributed to awards that employees forfeit because they fail to satisfy vesting conditions. The Company’s (i) time-based awards generally vest over a three three year performance period based on achievement of the specified performance criteria. The share-based compensation expense associated with awards that have graded vesting features and vest based on service conditions only is calculated on a straight-line basis over the requisite service period for the entire award. Compensation expense recognized in connection with performance awards is based on the achievement of the specified performance and service conditions. The final measure of compensation expense recognized over the requisite service period reflects the final performance outcome. During the recognition period compensation expense is accrued based on the performance condition that is probable of achievement. For awards granted to retirement-eligible employees where no service is required for the employee to retain the award, the grant date fair value is immediately recognized as compensation expense at the grant date because the employee is able to retain the award without continuing to provide service. For employees near retirement eligibility, attribution of compensation cost is over the period from the grant date to the retirement eligibility date. These charges had no impact on the Company’s cash flows or total shareholders’ equity. See note 22, “Share-Based Compensation” for information relating to the Company’s share-based payment awards. |
Guaranty fund and other related assessments | Liabilities for guaranty fund and other related assessments in the Company’s insurance and reinsurance operations are accrued when the Company receives notice that an amount is payable, or earlier if a reasonable estimate of the assessment can be made. |
Treasury shares | Treasury shares are common shares purchased by the Company and not subsequently canceled. These shares are recorded at cost and result in a reduction of the Company’s shareholders’ equity in its Consolidated Balance Sheets. |
Goodwill and intangible assets | Goodwill represents the excess of the purchase price of an acquisition over the fair value of the net assets acquired and is assigned to the applicable reporting unit at acquisition. Goodwill is evaluated for impairment on an annual basis. Impairment tests may be performed more frequently if the facts and circumstances indicate a possible impairment. In performing impairment tests, the Company may first assess qualitative factors to determine whether it is more likely than not (that is, more than a 50% probability) that the fair value of a reporting unit exceeds its carrying amount as a basis for determining whether it is necessary to perform goodwill impairment test described in the accounting guidance. Indefinite-lived intangible assets, such as insurance licenses are evaluated for impairment similar to goodwill. Finite-lived intangible assets and liabilities include the value of acquired insurance and reinsurance contracts, which are estimated based on the present value of future expected cash flows and amortized in proportion to the estimated profits expected to be realized. Other finite-lived intangible assets, including customer lists, trade name and IT platforms, are amortized over their useful lives. Finite-lived intangible assets and liabilities are periodically reviewed for indicators of impairment. An impairment is recognized when the carrying amount is not recoverable from its undiscounted cash flows and is measured as the difference between the carrying amount and fair value. If goodwill or intangible assets are impaired, such assets are written down to their fair values with the related expense recorded in the Company’s results of operations. |
Investment in operating affiliates | Investment in operating affiliates primarily represent the Company’s investments in which it has significant influence and which are accounted for under the equity method of accounting. In applying the equity method of accounting, investments in operating affiliates are initially recorded at cost and are subsequently adjusted based on the Company’s proportionate share of net income or loss of the operating affiliate. The Company records its proportionate share of other comprehensive income or loss of the operating affiliate as a component of other comprehensive income. Adjustments are based on the most recently available financial information from the operating affiliate. Changes in the carrying value of these investments are recorded in income (loss) from operating affiliates. |
Recent accounting pronouncements | Recently Issued Accounting Standards Adopted The Company adopted ASU 2019-12, “Simplifying the Accounting for Income Taxes.” This ASU eliminates certain exceptions for recognizing deferred taxes for investments, performing intraperiod tax allocations and calculating income taxes in interim periods. The ASU also clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The adoption of this guidance did not have a material effect on the Company’s consolidated financial statements. Recently Issued Accounting Standards Not Yet Adopted ASU 2020-04, “Facilitation of the Effects of Reference Rate Reform on Financial Reporting,” was issued in March 2020. This ASU provides optional expedients and exceptions for applying GAAP to investments, derivatives, or other transactions that reference the London Interbank Offered Rate (LIBOR) or another reference rate expected to be |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Analysis of underwriting income (loss) by segment and reconciliation to net income (loss) available to common shareholders | The following tables summarize the Company’s underwriting income or loss by segment, together with a reconciliation of underwriting income or loss to net income available to Arch common shareholders, summary information regarding net premiums written and earned by major line of business and net premiums written by location: Year Ended December 31, 2021 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 5,867,734 $ 5,093,930 $ 1,507,825 $ 12,463,788 $ 457,465 $ 12,752,487 Premiums ceded (1,719,541) (1,839,556) (246,757) (3,800,153) (102,763) (3,734,150) Net premiums written 4,148,193 3,254,374 1,261,068 8,663,635 354,702 9,018,337 Change in unearned premiums (521,725) (413,931) 22,351 (913,305) (22,734) (936,039) Net premiums earned 3,626,468 2,840,443 1,283,419 7,750,330 331,968 8,082,298 Other underwriting income (loss) — 3,669 17,665 21,334 739 22,073 Losses and loss adjustment expenses (2,344,365) (1,924,719) (56,677) (4,325,761) (259,042) (4,584,803) Acquisition expenses (606,265) (536,754) (97,418) (1,240,437) (62,741) (1,303,178) Other operating expenses (558,906) (212,810) (194,010) (965,726) (32,869) (998,595) Underwriting income (loss) $ 116,932 $ 169,829 $ 952,979 1,239,740 (21,945) 1,217,795 Net investment income 346,808 42,310 389,118 Net realized gains (losses) 299,207 80,638 379,845 Equity in net income (loss) of investments accounted for using the equity method 366,402 — 366,402 Other income (loss) 10,244 — 10,244 Corporate expenses (77,119) — (77,119) Transaction costs and other (1,103) (935) (2,038) Amortization of intangible assets (82,057) (898) (82,955) Interest expense (131,060) (8,410) (139,470) Net foreign exchange gains (losses) 42,854 (1,325) 41,529 Income (loss) before income taxes and income (loss) from operating affiliates 2,013,916 89,435 2,103,351 Income tax expense (128,348) (234) (128,582) Income (loss) from operating affiliates 264,693 — 264,693 Net income (loss) 2,150,261 89,201 2,239,462 Amounts attributable to redeemable noncontrolling interests (2,346) (1,953) (4,299) Amounts attributable to nonredeemable noncontrolling interests — (78,314) (78,314) Net income (loss) available to Arch 2,147,915 8,934 2,156,849 Preferred dividends (48,343) — (48,343) Loss on redemption of preferred shares (15,101) — (15,101) Net income (loss) available to Arch common shareholders $ 2,084,471 $ 8,934 $ 2,093,405 Underwriting Ratios Loss ratio 64.6 % 67.8 % 4.4 % 55.8 % 78.0 % 56.7 % Acquisition expense ratio 16.7 % 18.9 % 7.6 % 16.0 % 18.9 % 16.1 % Other operating expense ratio 15.4 % 7.5 % 15.1 % 12.5 % 9.9 % 12.4 % Combined ratio 96.7 % 94.2 % 27.1 % 84.3 % 106.8 % 85.2 % Goodwill and intangible assets $ 256,434 $ 183,523 $ 505,026 $ 944,983 $ — $ 944,983 Total investable assets $ 27,442,153 $ — $ 27,442,153 Total assets 45,100,945 — 45,100,945 Total liabilities 31,545,816 — 31,545,816 (1) Certain amounts included in the gross premiums written of each segment are related to intersegment transactions. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total. Year Ended December 31, 2020 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 4,688,562 $ 3,472,086 $ 1,473,999 $ 9,632,691 $ 728,546 $ 10,088,068 Premiums ceded (1,525,655) (1,014,716) (194,149) (2,732,564) (190,957) (2,650,352) Net premiums written 3,162,907 2,457,370 1,279,850 6,900,127 537,589 7,437,716 Change in unearned premiums (291,487) (295,141) 118,085 (468,543) 22,762 (445,781) Net premiums earned 2,871,420 2,162,229 1,397,935 6,431,584 560,351 6,991,935 Other underwriting income (31) 4,454 20,316 24,739 2,045 26,784 Losses and loss adjustment expenses (2,092,453) (1,628,320) (528,344) (4,249,117) (440,482) (4,689,599) Acquisition expenses, net (418,483) (354,048) (134,240) (906,771) (98,071) (1,004,842) Other operating expenses (489,153) (168,011) (162,202) (819,366) (55,810) (875,176) Underwriting income (loss) $ (128,700) $ 16,304 $ 593,465 481,069 (31,967) 449,102 Net investment income 401,908 117,700 519,608 Net realized gains (losses) 813,781 9,679 823,460 Equity in net income (loss) of investments accounted for using the equity method 146,693 — 146,693 Other income (loss) 29 — 29 Corporate expenses (68,492) — (68,492) Transaction costs and other (9,456) (4,040) (13,496) Amortization of intangible assets (69,031) — (69,031) Interest expense (120,214) (23,242) (143,456) Net foreign exchange gains (losses) (80,161) (3,473) (83,634) Income (loss) before income taxes and income (loss) from operating affiliates 1,496,126 64,657 1,560,783 Income tax (expense) benefit (111,812) (26) (111,838) Income (loss) from operating affiliates 16,766 — 16,766 Net income (loss) 1,401,080 64,631 1,465,711 Amounts attributable to redeemable noncontrolling interests (2,997) (4,117) (7,114) Amounts attributable to nonredeemable noncontrolling interests — (53,076) (53,076) Net income (loss) available to Arch 1,398,083 7,438 1,405,521 Preferred dividends (41,612) — (41,612) Net income (loss) available to Arch common shareholders $ 1,356,471 $ 7,438 $ 1,363,909 Underwriting Ratios Loss ratio 72.9 % 75.3 % 37.8 % 66.1 % 78.6 % 67.1 % Acquisition expense ratio 14.6 % 16.4 % 9.6 % 14.1 % 17.5 % 14.4 % Other operating expense ratio 17.0 % 7.8 % 11.6 % 12.7 % 10.0 % 12.5 % Combined ratio 104.5 % 99.5 % 59.0 % 92.9 % 106.1 % 94.0 % Goodwill and intangible assets $ 280,978 $ 18,963 $ 385,272 $ 685,213 $ 7,650 $ 692,863 Total investable assets $ 26,856,295 $ 2,657,612 $ 29,513,907 Total assets 39,791,983 3,490,314 43,282,297 Total liabilities 26,789,149 2,505,707 29,294,856 (1) Certain amounts included in the gross premiums written of each segment are related to intersegment transactions. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total. Year Ended December 31, 2019 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 3,907,993 $ 2,323,223 $ 1,466,265 $ 7,695,645 $ 754,881 $ 8,138,960 Premiums ceded (1,266,267) (720,500) (204,509) (2,189,440) (222,019) (2,099,893) Net premiums written 2,641,726 1,602,723 1,261,756 5,506,205 532,862 6,039,067 Change in unearned premiums (244,646) (136,334) 104,584 (276,396) 23,827 (252,569) Net premiums earned 2,397,080 1,466,389 1,366,340 5,229,809 556,689 5,786,498 Other underwriting income — 6,444 16,005 22,449 2,412 24,861 Losses and loss adjustment expenses (1,615,475) (1,011,329) (53,513) (2,680,317) (453,135) (3,133,452) Acquisition expenses, net (361,614) (239,032) (134,319) (734,965) (105,980) (840,945) Other operating expenses (454,770) (141,484) (153,092) (749,346) (51,651) (800,997) Underwriting income (loss) $ (34,779) $ 80,988 $ 1,041,421 1,087,630 (51,665) 1,035,965 Net investment income 491,067 136,671 627,738 Net realized gains (losses) 348,037 15,161 363,198 Equity in net income (loss) of investments accounted for using the equity method 123,672 — 123,672 Corporate expenses (65,667) — (65,667) Transaction costs and other (14,444) — (14,444) Amortization of intangible assets (82,104) — (82,104) Interest expense (93,735) (27,137) (120,872) Net foreign exchange gains (losses) (9,252) (11,357) (20,609) Income (loss) before income taxes and income (loss) from operating affiliates 1,785,204 61,673 1,846,877 Income tax benefit (155,790) (20) (155,810) Income (loss) from operating affiliates 2,233 — 2,233 Net income 1,631,647 61,653 1,693,300 Amounts attributable to redeemable noncontrolling interests — (16,909) (16,909) Amounts attributable to nonredeemable noncontrolling interests — (40,072) (40,072) Net income (loss) available to Arch 1,631,647 4,672 1,636,319 Preferred dividends (41,612) — (41,612) Net income (loss) available to Arch common shareholders $ 1,590,035 $ 4,672 $ 1,594,707 Underwriting Ratios Loss ratio 67.4 % 69.0 % 3.9 % 51.3 % 81.4 % 54.2 % Acquisition expense ratio 15.1 % 16.3 % 9.8 % 14.1 % 19.0 % 14.5 % Other operating expense ratio 19.0 % 9.6 % 11.2 % 14.3 % 9.3 % 13.8 % Combined ratio 101.5 % 94.9 % 24.9 % 79.7 % 109.7 % 82.5 % Goodwill and intangible assets $ 289,021 $ 2,516 $ 438,896 $ 730,433 $ 7,650 $ 738,083 Total investable assets $ 22,285,676 $ 2,704,589 $ 24,990,265 Total assets 34,374,468 3,510,893 37,885,361 Total liabilities 22,977,636 2,592,173 25,569,809 |
Summary of information regarding net premiums written and earned by major line of business and net premiums written by location | The following tables provide summary information regarding net premiums earned by major line of business and net premiums written by underwriting location: INSURANCE SEGMENT Year Ended December 31, 2021 2020 2019 Net premiums earned (1) Professional Lines (2) $ 942,817 $ 655,872 $ 499,224 Property, energy, marine and aviation 702,693 517,247 298,966 Programs 506,867 432,854 414,103 Construction and national accounts 381,306 387,934 325,687 Excess and surplus casualty (3) 318,027 270,620 200,615 Travel, accident and health 255,590 190,944 305,085 Lenders products 153,958 114,687 66,079 Other (4) 365,210 301,262 287,321 Total $ 3,626,468 $ 2,871,420 $ 2,397,080 Net premiums written by underwriting location (1) United States $ 2,813,039 $ 2,158,415 $ 1,983,476 Europe 1,125,192 856,572 559,214 Other 209,962 147,920 99,036 Total $ 4,148,193 $ 3,162,907 $ 2,641,726 (1) Insurance segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions. (2) Includes professional liability, executive assurance and healthcare business. (3) Includes casualty and contract binding business. (4) Includes alternative markets, excess workers' compensation and surety business. REINSURANCE SEGMENT Year Ended December 31, 2021 2020 2019 Net premiums earned (1) Property excluding property catastrophe $ 836,573 $ 562,208 $ 362,841 Other Specialty (2) 818,801 626,409 478,517 Casualty (3) 666,754 549,056 429,288 Property catastrophe 280,738 237,736 90,934 Marine and aviation 152,955 109,624 48,274 Other (4) 84,622 77,196 56,535 Total $ 2,840,443 $ 2,162,229 $ 1,466,389 Net premiums written by underwriting location (1) United States $ 828,504 $ 687,622 $ 529,943 Bermuda 1,557,294 1,001,990 578,618 Europe and other 868,576 767,758 494,162 Total $ 3,254,374 $ 2,457,370 $ 1,602,723 (1) Reinsurance segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions. (2) Includes proportional motor, surety, accident and health, workers’ compensation catastrophe, agriculture, trade credit and other. (3) Includes executive assurance, professional liability, workers’ compensation, excess motor, healthcare and other. (4) Includes life, casualty clash and other. MORTGAGE SEGMENT Year Ended December 31, 2021 2020 2019 Net premiums earned by underwriting location United States $ 970,507 $ 1,158,563 $ 1,134,849 Other 312,912 239,372 231,491 Total $ 1,283,419 $ 1,397,935 $ 1,366,340 Net premiums written by underwriting location United States $ 914,477 $ 1,021,950 $ 1,032,868 Other 346,591 257,900 228,888 Total $ 1,261,068 $ 1,279,850 $ 1,261,756 OTHER SEGMENT Year Ended December 31, 2021 2020 2019 Net premiums earned (1) Casualty (2) $ 138,551 $ 245,272 $ 246,894 Other specialty (3) 118,356 186,717 185,547 Property catastrophe 15,235 23,037 13,399 Property excluding property catastrophe 6,578 1,130 3,503 Marine and aviation 190 429 — Other (4) 53,058 103,766 107,346 Total $ 331,968 $ 560,351 $ 556,689 Net premiums written by underwriting location (1) United States $ 63,403 $ 115,471 $ 127,176 Europe 91,499 $ 97,753 $ 52,065 Bermuda 199,800 $ 324,365 $ 353,621 Total $ 354,702 $ 537,589 $ 532,862 (1) Other segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions. (2) Includes professional liability, excess motor, programs and other. (3) Includes proportional motor and other. (4) Includes mortgage, US programs and other. |
Reserve for Losses and Loss A_2
Reserve for Losses and Loss Adjustment Expenses (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract] | |
Analysis of losses and loss adjustment expenses and reconciliation of beginning and ending reserve balances | The following table represents an analysis of losses and loss adjustment expenses and a reconciliation of the beginning and ending reserve for losses and loss adjustment expenses: Year Ended December 31, 2021 2020 2019 Reserve for losses and loss adjustment expenses at beginning of year $ 16,513,929 $ 13,891,842 $ 11,853,297 Unpaid losses and loss adjustment expenses recoverable 4,314,855 4,082,650 2,814,291 Net reserve for losses and loss adjustment expenses at beginning of year 12,199,074 9,809,192 9,039,006 Net incurred losses and loss adjustment expenses relating to losses occurring in: Current year 4,940,987 4,851,051 3,297,037 Prior years (356,184) (161,452) (163,585) Total net incurred losses and loss adjustment expenses 4,584,803 4,689,599 3,133,452 Net losses and loss adjustment expense reserves of acquired business (1) 104,176 — 209,486 Retroactive reinsurance transactions (2) (444,147) 182,210 (225,500) Impact of deconsolidation of Somers (3) (1,460,611) — — Foreign exchange (gains) losses and other 1,181 179,190 36,003 Net paid losses and loss adjustment expenses relating to losses occurring in: Current year (734,846) (661,529) (621,202) Prior years (2,091,705) (1,999,588) (1,762,053) Total net paid losses and loss adjustment expenses (2,826,551) (2,661,117) (2,383,255) Net reserve for losses and loss adjustment expenses at end of year 12,157,925 12,199,074 9,809,192 Unpaid losses and loss adjustment expenses recoverable 5,599,231 4,314,855 4,082,650 Reserve for losses and loss adjustment expenses at end of year $ 17,757,156 $ 16,513,929 $ 13,891,842 ( 1) Represents activity related to the Company’s acquisitions in the 2021 and the 2019 period. See Note 2 . (2) See ‘Retroactive Reinsurance Transactions’ section. (3) See note 12 |
Short Duration Contracts (Table
Short Duration Contracts (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Short Duration Contracts Disclosure [Abstract] | |
Levels of disaggregation | The Company’s reserves for losses and loss adjustment expenses primarily relate to short-duration contracts with various characteristics ( e.g. , type of coverage, geography, claims duration). The Company considered such information in determining the level of disaggregation for disclosures related to its short-duration contracts, as detailed in the table below: Reportable segment Level of disaggregation Included lines of business Insurance Property energy, marine and aviation Property energy, marine and aviation Third party occurrence business Excess and surplus casualty (excluding contract binding); construction and national accounts; and other (including alternative market risks, excess workers’ compensation and employer’s liability insurance coverages) Third party claims-made business Professional lines Multi-line and other specialty Programs; contract binding (part of excess and surplus casualty); travel, accident and health; lenders products; and other (c ontract and commercial surety coverages) Reinsurance Casualty Casualty Property catastrophe Property catastrophe Property excluding property catastrophe Property excluding property catastrophe Marine and aviation Marine and aviation Other specialty Other specialty Mortgage Direct mortgage insurance in the U.S. Mortgage insurance on U.S. primary exposures |
Claims Development [Line Items] | |
Reconciliation of claims development to liability | The following table represents a reconciliation of the disclosures of net incurred and paid loss development tables to the reserve for losses and loss adjustment expenses at December 31, 2021: December 31, 2021 Net outstanding liabilities Insurance Property, energy, marine and aviation $ 586,885 Third party occurrence business 2,885,557 Third party claims-made business 1,613,425 Multi-line and other specialty 1,125,841 Reinsurance Casualty 2,106,507 Property catastrophe 486,248 Property excluding property catastrophe 724,034 Marine and aviation 245,881 Other specialty 981,805 Mortgage U.S. primary 688,688 Other short duration lines not included in disclosures 441,459 Total for short duration lines 11,886,330 Unpaid losses and loss adjustment expenses recoverable Insurance Property, energy, marine and aviation 354,432 Third party occurrence business 1,537,549 Third party claims-made business 921,086 Multi-line and other specialty 199,485 Reinsurance Casualty 592,879 Property catastrophe 484,598 Property excluding property catastrophe 118,939 Marine and aviation 111,298 Other specialty 373,292 Mortgage U.S. primary 48,259 Other short duration lines not included in disclosures (1) 887,457 Intercompany eliminations (4,146) Total for short duration lines 5,625,128 Lines other than short duration 76,240 Discounting (55,575) Unallocated claims adjustment expenses 225,033 245,698 Total gross reserves for losses and loss adjustment expenses $ 17,757,156 (1) Includes unpaid loss and loss adjustment expenses recoverable of $390.1 million related to the loss portfolio transfer reinsurance agreements. |
Insurance | |
Claims Development [Line Items] | |
Claims development tables | The following tables present information on the insurance segment’s short-duration insurance contracts: Property, energy, marine and aviation ($000’s except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 233,149 $ 232,498 $ 205,776 $ 199,469 $ 197,005 $ 192,993 $ 190,770 $ 178,616 $ 178,250 $ 178,343 $ 627 4,245 2013 159,102 156,785 149,199 143,400 134,952 133,869 128,624 127,290 126,276 25 4,243 2014 148,368 145,957 147,465 136,201 132,307 134,329 135,032 134,942 3,098 3,884 2015 112,409 109,865 103,995 102,515 97,852 91,830 91,892 3,804 4,536 2016 104,449 101,306 105,657 100,471 96,437 92,553 874 6,160 2017 280,715 246,291 235,951 230,439 231,228 8,248 6,426 2018 180,981 186,030 173,693 170,057 9,136 5,020 2019 179,056 178,564 165,477 6,667 5,080 2020 359,394 329,362 66,698 4,186 2021 426,870 158,163 2,951 Total $ 1,947,000 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 20,638 $ 93,394 $ 138,977 $ 161,831 $ 167,540 $ 179,945 $ 181,307 $ 173,184 $ 174,032 $ 174,384 2013 32,292 84,936 110,808 120,111 122,244 125,475 123,356 124,688 124,841 2014 25,881 53,751 77,892 84,195 87,812 98,553 115,383 122,296 2015 23,580 64,953 76,338 86,253 87,926 86,246 87,316 2016 24,828 83,552 98,683 97,506 95,002 91,241 2017 30,228 139,867 195,532 211,708 215,895 2018 30,026 102,285 134,858 142,838 2019 26,130 105,380 133,911 2020 55,619 194,487 2021 90,423 Total 1,377,632 All outstanding liabilities before 2012, net of reinsurance 17,517 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 586,885 Third party occurrence business ($000’s except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 241,368 $ 263,451 $ 269,204 $ 272,004 $ 258,371 $ 253,758 $ 243,863 $ 244,448 $ 242,332 $ 239,075 $ 43,924 65,731 2013 283,228 297,225 307,152 302,165 282,122 274,717 272,849 269,754 270,558 54,640 67,113 2014 330,015 336,019 338,890 343,113 339,701 344,197 342,934 343,569 66,498 75,904 2015 359,058 391,884 398,908 392,143 391,455 382,722 386,801 91,081 78,785 2016 389,832 394,485 406,082 399,571 374,896 367,818 115,303 79,005 2017 417,377 417,941 422,624 412,512 407,115 145,130 84,692 2018 430,415 453,190 450,937 451,459 189,965 77,700 2019 456,353 487,547 481,045 253,849 84,895 2020 607,249 616,910 428,750 89,560 2021 622,713 543,386 65,477 Total $ 4,187,063 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 6,984 $ 30,915 $ 58,650 $ 83,637 $ 108,660 $ 130,098 $ 143,885 $ 155,085 $ 163,016 $ 168,119 2013 6,857 29,265 71,449 101,293 122,288 149,292 164,403 174,946 184,800 2014 9,228 40,346 71,624 112,702 162,123 191,305 211,643 224,101 2015 11,139 44,605 88,515 139,492 181,704 211,715 227,697 2016 11,709 41,979 87,616 136,870 164,662 194,773 2017 13,408 52,356 99,874 135,111 165,606 2018 17,025 63,848 115,137 154,248 2019 18,431 73,222 121,859 2020 24,509 76,743 2021 26,301 Total 1,544,247 All outstanding liabilities before 2012, net of reinsurance 242,741 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 2,885,557 Third party claims-made business ($000’s except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 317,654 $ 320,207 $ 318,453 $ 313,907 $ 291,316 $ 275,665 $ 277,683 $ 285,163 $ 285,527 $ 286,118 $ 11,570 15,576 2013 301,956 320,659 324,442 320,524 294,674 291,205 281,996 271,501 273,948 11,739 15,696 2014 264,537 279,846 299,104 279,043 282,058 298,017 292,247 288,318 22,336 15,676 2015 258,989 277,615 276,492 260,063 255,432 252,478 267,925 20,617 14,724 2016 275,394 291,645 308,453 314,747 322,042 327,230 42,509 15,749 2017 271,088 286,565 312,554 308,917 323,854 60,718 16,404 2018 273,521 315,085 320,653 337,083 85,411 15,854 2019 290,217 318,469 318,498 119,673 12,982 2020 384,852 414,580 240,888 10,049 2021 516,420 435,910 8,550 Total $ 3,353,974 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 17,718 $ 69,069 $ 121,211 $ 164,724 $ 190,395 $ 209,295 $ 227,389 $ 251,313 $ 255,337 $ 260,173 2013 19,032 87,458 137,963 179,395 198,008 217,132 238,951 245,687 247,078 2014 13,817 63,312 129,712 173,089 208,074 229,958 243,791 249,960 2015 9,066 52,046 100,089 126,499 174,161 193,186 216,986 2016 10,568 68,226 127,286 158,230 205,596 242,431 2017 9,306 67,669 113,208 143,340 196,125 2018 12,287 68,424 118,361 158,709 2019 12,418 65,477 122,362 2020 17,161 87,547 2021 23,349 Total 1,804,720 All outstanding liabilities before 2012, net of reinsurance 64,171 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 1,613,425 Multi-line and other specialty ($000’s except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 254,684 $ 265,479 $ 259,582 $ 257,240 $ 256,379 $ 248,066 $ 248,310 $ 245,205 $ 245,260 $ 243,849 $ 2,057 55,219 2013 266,089 274,285 265,594 265,672 253,554 254,916 250,252 247,443 246,682 3,461 71,613 2014 303,053 327,098 319,706 319,418 318,297 314,300 311,097 310,097 5,770 109,575 2015 335,250 358,587 357,364 365,362 357,123 349,895 347,669 7,201 148,924 2016 409,367 431,760 428,579 416,724 410,610 408,621 11,032 175,261 2017 483,414 502,068 492,166 501,753 505,135 16,867 219,810 2018 513,466 565,717 563,969 566,283 32,467 247,052 2019 568,337 613,673 641,832 63,880 235,824 2020 622,241 572,265 192,056 149,004 2021 637,258 361,237 75,250 Total $ 4,479,691 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 78,523 $ 166,414 $ 190,754 $ 209,916 $ 223,798 $ 232,640 $ 233,862 $ 237,221 $ 240,191 $ 239,928 2013 86,911 151,897 181,721 214,941 226,769 235,801 237,863 238,792 239,831 2014 108,003 197,609 235,079 267,959 282,104 292,638 294,049 295,551 2015 138,393 236,516 278,265 306,313 321,395 327,082 330,872 2016 176,238 305,250 342,345 363,392 379,885 385,890 2017 181,454 343,049 381,419 424,219 446,749 2018 212,316 390,009 443,644 480,852 2019 212,629 386,894 488,094 2020 173,123 311,112 2021 157,346 Total 3,376,225 All outstanding liabilities before 2012, net of reinsurance 22,375 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 1,125,841 |
Percentage annual payout by age | The following table presents the average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance, as of December 31, 2021: Average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Property, energy, marine and aviation 19.3 % 43.5 % 19.1 % 6.6 % 1.4 % 2.3 % 3.2 % 0.5 % 0.3 % 0.2 % Third party occurrence business 3.3 % 9.3 % 11.6 % 11.0 % 9.8 % 8.7 % 5.4 % 4.1 % 3.5 % 2.1 % Third party claims-made business 4.4 % 18.0 % 17.8 % 12.3 % 12.7 % 7.9 % 7.0 % 4.3 % 1.0 % 1.7 % Multi-line and other specialty 34.7 % 29.5 % 11.0 % 8.6 % 4.6 % 2.8 % 0.7 % 0.7 % 0.8 % (0.1) % |
Reinsurance | |
Claims Development [Line Items] | |
Claims development tables | The following tables present information on the reinsurance segment’s short-duration insurance contracts: Casualty ($000’s) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 143,029 $ 141,202 $ 137,049 $ 125,104 $ 115,131 $ 109,788 $ 118,457 $ 121,721 $ 120,260 $ 119,222 $ 24,441 N/A 2013 166,016 159,257 155,066 148,784 136,717 135,155 131,475 135,762 135,959 30,873 N/A 2014 216,882 222,109 219,355 233,552 230,019 239,765 240,067 236,378 41,077 N/A 2015 223,208 221,922 230,830 238,126 242,180 249,029 252,809 57,345 N/A 2016 215,222 227,534 251,415 266,254 273,266 272,689 54,087 N/A 2017 270,728 257,088 273,166 301,616 313,605 66,450 N/A 2018 281,141 294,820 285,646 290,955 66,572 N/A 2019 336,062 348,015 374,002 120,045 N/A 2020 386,684 374,912 234,251 N/A 2021 445,047 392,885 N/A Total $ 2,815,578 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 1,306 $ 8,486 $ 14,690 $ 25,523 $ 36,562 $ 47,807 $ 59,511 $ 69,877 $ 75,833 $ 79,364 2013 2,480 9,930 23,044 43,069 54,567 63,136 70,803 76,703 81,856 2014 3,920 16,061 40,804 63,441 91,098 114,456 134,529 145,376 2015 4,463 20,275 47,288 71,098 96,835 120,566 138,035 2016 5,739 25,649 51,684 86,798 113,835 132,814 2017 6,429 30,360 64,075 113,307 137,921 2018 7,580 31,218 106,571 129,196 2019 15,815 57,643 96,935 2020 17,730 50,603 2021 14,794 Total 1,006,894 All outstanding liabilities before 2012, net of reinsurance 297,823 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 2,106,507 Property catastrophe ($000’s) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 149,957 $ 122,942 $ 108,590 $ 102,114 $ 99,885 $ 99,071 $ 97,037 $ 97,145 $ 96,531 $ 96,447 $ 105 N/A 2013 67,257 47,780 36,401 31,902 29,345 28,617 27,727 27,865 27,657 (138) N/A 2014 45,159 30,877 25,296 22,412 20,652 19,945 19,841 19,615 (10) N/A 2015 33,579 18,075 11,580 5,585 3,775 3,130 2,920 67 N/A 2016 25,641 18,719 14,575 10,772 8,362 7,426 881 N/A 2017 87,504 54,768 50,553 36,846 25,121 (712) N/A 2018 77,868 60,418 41,642 27,657 4,783 N/A 2019 38,570 24,808 23,534 4,576 N/A 2020 267,750 334,185 40,561 N/A 2021 316,197 61,821 N/A Total $ 880,759 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 25,850 $ 70,832 $ 83,822 $ 90,727 $ 92,886 $ 94,015 $ 94,625 $ 95,312 $ 95,414 $ 95,606 2013 12,200 19,201 24,038 25,894 27,652 27,891 27,892 28,597 28,346 2014 13,622 19,939 18,402 19,231 18,821 19,013 19,154 19,241 2015 (3,152) (2,518) 1,786 2,050 1,616 1,705 1,781 2016 (6,722) 2,521 2,796 4,082 3,312 3,668 2017 30,704 32,228 37,791 27,797 14,969 2018 27,497 12,506 24,259 (4,612) 2019 3,834 12,680 18,134 2020 53,275 155,063 2021 64,764 Total 396,960 All outstanding liabilities before 2012, net of reinsurance 2,449 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 486,248 Property excluding property catastrophe ($000’s) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 156,162 $ 121,808 $ 123,689 $ 119,124 $ 114,699 $ 112,477 $ 111,001 $ 108,436 $ 102,994 $ 103,367 $ 508 N/A 2013 115,473 76,905 70,558 66,208 64,486 63,702 62,504 63,269 62,782 384 N/A 2014 143,464 117,448 99,328 90,710 88,438 84,130 82,408 80,940 923 N/A 2015 215,095 189,109 184,774 189,045 188,343 177,281 173,659 8,482 N/A 2016 177,039 146,307 138,375 136,868 140,681 137,579 12,700 N/A 2017 271,713 253,859 240,749 233,153 216,358 13,045 N/A 2018 225,638 242,069 238,052 214,942 11,593 N/A 2019 216,653 206,997 196,840 17,777 N/A 2020 371,752 343,078 51,075 N/A 2021 552,066 255,343 N/A Total $ 2,081,611 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 26,153 $ 78,080 $ 93,198 $ 101,868 $ 102,844 $ 103,480 $ 102,658 $ 102,598 $ 102,504 $ 102,525 2013 25,993 42,737 49,816 52,997 53,796 55,676 61,183 62,113 62,139 2014 23,496 62,800 71,692 76,634 78,274 78,657 78,567 78,268 2015 75,622 119,237 149,814 160,848 166,025 159,675 159,925 2016 33,400 95,616 99,428 104,984 112,838 115,102 2017 27,569 125,768 158,066 166,087 181,628 2018 30,047 108,863 153,944 169,054 2019 43,230 124,222 150,931 2020 101,969 208,888 2021 136,712 Total 1,365,172 All outstanding liabilities before 2012, net of reinsurance 7,595 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 724,034 Marine and aviation ($000’s) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 58,992 $ 58,868 $ 55,053 $ 52,286 $ 51,079 $ 49,727 $ 46,046 $ 43,028 $ 41,182 $ 40,016 $ 1,005 N/A 2013 38,881 37,668 36,653 35,251 35,157 34,415 33,970 30,316 27,605 2,394 N/A 2014 30,958 29,159 27,373 25,674 23,677 23,310 22,031 21,984 4,909 N/A 2015 33,646 37,505 31,790 31,736 30,789 28,464 27,680 3,867 N/A 2016 27,351 22,747 23,567 19,273 16,969 15,019 6,708 N/A 2017 28,800 26,346 23,830 20,827 19,903 6,387 N/A 2018 28,017 26,084 24,615 24,756 6,452 N/A 2019 48,929 55,307 60,983 15,112 N/A 2020 83,457 76,598 36,671 N/A 2021 111,046 89,459 N/A Total $ 425,590 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 2,658 $ 11,433 $ 27,528 $ 33,313 $ 35,055 $ 36,257 $ 37,746 $ 38,038 $ 38,131 $ 38,116 2013 4,945 13,731 18,415 21,388 22,398 23,672 24,049 23,786 23,753 2014 4,177 7,985 11,590 12,469 14,645 15,080 15,956 16,036 2015 7 13,418 19,023 20,861 22,629 22,306 22,445 2016 (7,333) (1,687) 521 3,261 5,864 6,767 2017 1,660 6,541 9,367 11,030 11,632 2018 2,005 6,968 11,236 13,585 2019 10,756 21,580 29,068 2020 9,220 26,519 2021 8,643 Total 196,564 All outstanding liabilities before 2012, net of reinsurance 16,855 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 245,881 Other specialty ($000’s) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 222,558 $ 211,839 $ 202,046 $ 196,138 $ 193,882 $ 196,539 $ 194,726 $ 189,193 $ 181,246 $ 179,364 $ 2,392 N/A 2013 252,744 226,032 216,250 212,721 213,614 211,261 210,825 204,894 201,830 6,409 N/A 2014 274,826 256,332 258,114 251,474 246,393 248,083 243,652 237,478 7,857 N/A 2015 209,764 201,057 199,468 196,521 196,840 193,626 182,162 8,549 N/A 2016 223,191 220,661 215,078 209,564 215,614 210,344 13,182 N/A 2017 269,254 258,419 247,203 245,505 241,598 30,855 N/A 2018 320,538 316,231 308,190 324,536 40,807 N/A 2019 360,854 341,409 326,168 51,165 N/A 2020 533,861 460,084 102,130 N/A 2021 582,446 300,667 N/A Total $ 2,946,010 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 $ 45,663 $ 121,679 $ 144,429 $ 155,445 $ 163,160 $ 167,164 $ 171,519 $ 173,305 $ 173,606 $ 173,494 2013 57,317 119,445 145,521 161,608 171,189 176,483 183,772 184,111 186,956 2014 68,869 146,652 182,184 195,433 201,974 212,991 215,597 219,060 2015 54,359 114,382 138,350 145,419 154,369 162,314 164,471 2016 65,055 138,648 162,661 174,403 186,247 189,411 2017 73,366 164,829 192,274 199,051 205,998 2018 71,167 201,732 231,358 245,330 2019 79,718 158,132 216,647 2020 97,617 243,980 2021 126,635 Total 1,971,982 All outstanding liabilities before 2012, net of reinsurance 7,777 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 981,805 |
Percentage annual payout by age | The following table presents the average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance, as of December 31, 2021: Average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Casualty 2.5 % 7.3 % 11.6 % 11.3 % 9.6 % 8.4 % 7.7 % 5.9 % 4.4 % 3.0 % Property catastrophe 21.6 % 30.0 % 32.8 % (14.2) % (11.6) % 2.2 % 1.0 % 1.2 % (0.4) % 0.2 % Property excluding property catastrophe 26.7 % 38.9 % 13.3 % 5.8 % 3.4 % 0.4 % 2.0 % 0.4 % — % — % Marine and aviation 4.9 % 26.9 % 19.0 % 10.3 % 7.4 % 2.9 % 2.4 % — % 0.1 % — % Other specialty 26.3 % 34.2 % 12.9 % 5.2 % 4.2 % 3.1 % 2.1 % 0.9 % 0.8 % (0.1) % |
Mortgage | |
Claims Development [Line Items] | |
Claims development tables | The following table presents information on the mortgage segment’s short-duration insurance contracts: U.S. primary mortgage insurance ($000’s except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2021 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 $ 520,835 $ 480,592 $ 475,317 $ 469,238 $ 467,296 $ 459,467 $ 458,065 $ 456,286 $ 456,331 $ 456,362 1 15,080 2013 469,311 419,668 411,793 405,809 395,693 393,149 390,987 391,062 391,324 1 9,468 2014 316,095 297,151 279,434 266,027 265,992 261,091 262,682 262,829 4 6,299 2015 222,790 197,238 198,001 194,677 189,235 190,913 190,560 1 4,554 2016 183,556 170,532 148,715 140,608 142,392 141,657 1 3,424 2017 179,376 132,220 107,255 108,181 109,242 1 2,474 2018 132,318 96,357 89,120 87,962 60 1,635 2019 108,424 119,253 110,362 181 851 2020 420,003 373,533 2,686 189 2021 144,375 2,246 11 Total $ 2,268,206 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2012 (106,065) 186,605 327,605 395,695 426,024 441,577 448,151 452,348 453,587 453,986 2013 41,447 203,957 308,956 353,189 373,909 382,200 386,853 387,894 387,879 2014 20,099 129,159 201,925 233,879 247,038 254,175 256,285 256,875 2015 16,159 92,431 151,222 171,337 180,321 183,472 184,025 2016 11,462 72,201 113,357 127,286 131,161 131,717 2017 8,622 48,112 78,650 87,317 89,756 2018 3,966 31,478 50,135 55,853 2019 2,899 20,105 29,102 2020 1,040 4,144 2021 469 1,593,806 All outstanding liabilities before 2012, net of reinsurance 14,288 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 688,688 |
Percentage annual payout by age | The following table presents the average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance, as of December 31, 2021: Average annual percentage payout of incurred losses and allocated loss adjustment expenses by age, net of reinsurance Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 U.S. Primary 2.7 % 34.9 % 25.3 % 10.5 % 4.4 % 2.1 % 0.9 % 0.5 % 0.1 % 0.1 % |
Allowance for Expected Credit_2
Allowance for Expected Credit Losses (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Credit Loss [Abstract] | |
Allowance for credit losses on premiums receivable | Premiums Receivable The following table provides a roll forward of the allowance for expected credit losses of the Company’s premium receivables: Year Ended December 31, 2021 Premium Receivables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 2,064,586 $ 37,781 Change for provision of expected credit losses (2) 2,177 Balance at end of period $ 2,633,280 $ 39,958 Year Ended December 31, 2020 Balance at beginning of period $ 1,778,717 $ 21,003 Cumulative effect of accounting change (1) 6,539 Change for provision of expected credit losses (2) 10,239 Balance at end of period $ 2,064,586 $ 37,781 (1) Adoption of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)”. (2) Amounts deemed uncollectible are written-off in operating expenses. For the 2021 and 2020 periods, amounts written off totaled $3.8 million and $2.8 million, respectively. |
Allowance for credit losses on reinsurance recoverable | The following table provides a roll forward of the allowance for expected credit losses of the Company’s reinsurance recoverables: Year Ended December 31, 2021 Reinsurance Recoverables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 4,500,802 $ 11,636 Change for provision of expected credit losses 1,594 Balance at end of period $ 5,880,735 $ 13,230 Year Ended December 31, 2020 Balance at beginning of period $ 4,346,816 $ 1,364 Cumulative effect of accounting change (1) 12,010 Change for provision of expected credit losses (1,738) Balance at end of period 4,500,802 $ 11,636 (1) Adoption of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)”. |
Summary of reinsurance recoverables on paid and unpaid losses | The following table summarizes the Company’s reinsurance recoverables on paid and unpaid losses (not including ceded unearned premiums) at December 31, 2021 and 2020: December 31, 2021 2020 Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses $ 5,880,735 $ 4,500,802 % due from carriers with A.M. Best rating of “A-” or better 69.7 % 63.9 % % due from all other rated carriers 0.1 % 0.1 % % due from all other carriers with no A.M. Best rating (1) 30.2 % 36.0 % Largest balance due from any one carrier as % of total shareholders’ equity (2) 6.7 % 1.8 % (1) At December 31, 2021 and 2020 period, over 91% and 94% of such amount is collateralized through reinsurance trusts, funds withheld arrangements, letters of credit or other, respectively. (2) The 2021 period included impact of deconsolidation of Somers. See note 12. |
Allowance for credit losses on contractholder receivables | The following table provides a roll forward of the allowance for expected credit losses of the Company’s contractholder receivables: Year Ended December 31, 2021 Contractholder Receivables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 1,986,924 $ 8,638 Change for provision of expected credit losses (5,201) Balance at end of period $ 1,828,691 $ 3,437 Year Ended December 31, 2020 Balance at beginning of period $ 2,119,460 $ — Cumulative effect of accounting change (1) 6,663 Change for provision of expected credit losses 1,975 Balance at end of period 1,986,924 $ 8,638 |
Reinsurance (Tables)
Reinsurance (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Reinsurance Disclosures [Abstract] | |
Effects of reinsurance | The effects of reinsurance on the Company’s written and earned premiums and losses and loss adjustment expenses with unaffiliated reinsurers were as follows: Year Ended December 31, 2021 2020 2019 Premiums Written Direct $ 7,706,832 $ 6,553,910 $ 5,681,523 Assumed 5,045,655 3,534,158 2,457,437 Ceded (3,734,150) (2,650,352) (2,099,893) Net $ 9,018,337 $ 7,437,716 $ 6,039,067 Premiums Earned Direct $ 7,149,794 $ 6,361,451 $ 5,447,829 Assumed 4,333,873 3,213,873 2,337,950 Ceded (3,401,369) (2,583,389) (1,999,281) Net $ 8,082,298 $ 6,991,935 $ 5,786,498 Losses and Loss Adjustment Expenses Direct $ 4,266,758 $ 4,392,392 $ 2,953,072 Assumed 2,826,820 2,204,323 1,602,528 Ceded (2,508,775) (1,907,116) (1,422,148) Net $ 4,584,803 $ 4,689,599 $ 3,133,452 |
Coverage and retention | The following table summarizes the respective coverages and retentions at December 31, 2021: December 31, 2021 Initial Coverage at Issuance Current Remaining Retention, Net Bellemeade 2017-1 Ltd. (1) $ 368,114 $ 108,368 $ 125,926 Bellemeade 2018-1 Ltd. (2) 374,460 181,136 122,118 Bellemeade 2018-3 Ltd. (3) 506,110 302,563 128,020 Bellemeade 2019-1 Ltd. (4) 341,790 181,324 97,845 Bellemeade 2019-2 Ltd. (5) 621,022 398,316 156,419 Bellemeade 2019-3 Ltd. (6) 700,920 409,859 181,583 Bellemeade 2019-4 Ltd. (7) 577,267 411,954 116,292 Bellemeade 2020-2 Ltd. (8) 449,167 218,877 222,567 Bellemeade 2020-3 Ltd. (9) 451,816 365,141 154,732 Bellemeade 2020-4 Ltd. (10) 337,013 186,065 129,824 Bellemeade 2021-1 Ltd. (11) 643,577 630,163 149,189 Bellemeade 2021-2 Ltd. (12) 616,017 616,017 139,763 Bellemeade 2021-3 Ltd. (13) 639,391 639,391 140,545 Total $ 6,626,664 $ 4,649,174 $ 1,864,823 (1) Issued in October 2017, covering in-force policies issued between January 1, 2017 and June 30, 2017. (2) Issued in April 2018, covering in-force policies issued between July 1, 2017 and December 31, 2017. (3) Issued in October 2018, covering in-force policies issued between January 1, 2018 and June 30, 2018. (4) Issued in March 2019, covering in-force policies primarily issued between 2005 to 2008 under United Guaranty Residential Insurance Company (“UGRIC”); as well as policies issued through 2015 under both UGRIC and Arch Mortgage Insurance Company. (5) Issued in April 2019, covering in-force policies issued between July 1, 2018 and December 31, 2018. (6) Issued in July 2019, covering in-force policies issued in 2016. (7) Issued in October 2019, covering in-force policies issued between January 1, 2019 and June 30, 2019. (8) Issued in September 2020, covering in-force policies issued between January 1, 2020 and May 31, 2020. $423 million was directly funded by Bellemeade 2020-2 Ltd. with an additional $26 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (9) Issued in November 2020, covering in-force policies issued between June 1, 2020 and August 31, 2020. $418 million was directly funded by Bellemeade 2020-3 Ltd. with an additional $34 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (10) Issued in December 2020, covering in-force policies issued between July 1, 2019 and December 31, 2019. $321 million was directly funded by Bellemeade 2020-4 Ltd. with an additional $16 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (11) Issued in March 2021, covering in-force policies issued between September 1, 2020 and November 30, 2020. $580 million was directly funded by Bellemeade Re 2021-1 Ltd. with an additional $64 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (12) Issued in June 2021, covering in-force policies issued between December 1, 2020 and March 31, 2021. $523 million was directly funded by Bellemeade Re 2021-2 Ltd. via insurance-linked notes, with an additional $93 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (13) Issued in September 2021, covering in-force policies issued between April 1, 2021 and June 30, 2021. $508 million was directly funded by Bellemeade Re 2021-3 Ltd. via insurance-linked notes, with an additional $131 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. |
Investment Information (Tables)
Investment Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Investment Information [Abstract] | |
Summary of fair value and cost or amortized cost of available for sale securities | The following table summarizes the fair value and cost or amortized cost of the Company’s securities classified as available for sale: Estimated Gross Unrealized Gains Gross Unrealized Losses Allowance for Expected Credit Losses (2) Cost or December 31, 2021 Fixed maturities: Corporate bonds $ 6,553,333 $ 104,170 $ (69,194) $ (2,037) $ 6,520,394 Mortgage backed securities 408,477 2,825 (5,410) (48) 411,110 Municipal bonds 404,666 18,724 (1,409) (2) 387,353 Commercial mortgage backed securities 1,046,484 1,740 (3,117) (6) 1,047,867 U.S. government and government agencies 4,772,764 10,076 (45,967) — 4,808,655 Non-U.S. government securities 2,120,294 54,048 (34,749) (82) 2,101,077 Asset backed securities 2,692,091 6,540 (11,108) (708) 2,697,367 Total 17,998,109 198,123 (170,954) (2,883) 17,973,823 Short-term investments 1,734,716 568 (590) — 1,734,738 Total $ 19,732,825 $ 198,691 $ (171,544) $ (2,883) $ 19,708,561 December 31, 2020 Fixed maturities (1): Corporate bonds $ 7,856,571 $ 414,247 $ (34,388) $ (896) $ 7,477,608 Mortgage backed securities 630,001 8,939 (5,028) (278) 626,368 Municipal bonds 494,522 27,291 (3,835) (11) 471,077 Commercial mortgage backed securities 389,900 8,722 (2,954) (122) 384,254 U.S. government and government agencies 5,557,077 22,612 (12,611) — 5,547,076 Non-U.S. government securities 2,433,733 153,891 (8,060) — 2,287,902 Asset backed securities 1,634,804 19,225 (10,715) (1,090) 1,627,384 Total 18,996,608 654,927 (77,591) (2,397) 18,421,669 Short-term investments 1,924,922 2,693 (2,063) — 1,924,292 Total $ 20,921,530 $ 657,620 $ (79,654) $ (2,397) $ 20,345,961 (1) In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities pledged. For purposes of this table, the Company has excluded the collateral received under securities lending, at fair value and included the securities pledged under securities lending, at fair value. See “—Securities Lending Agreements.” In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions. |
Summary of available for sale securities in a continual unrealized loss position | The following table summarizes, for all available for sale securities in an unrealized loss position, the fair value and gross unrealized loss by length of time the security has been in a continual unrealized loss position: Less than 12 Months 12 Months or More Total Estimated Fair Gross Unrealized Losses Estimated Fair Gross Unrealized Losses Estimated Fair Gross Unrealized Losses December 31, 2021 Fixed maturities: Corporate bonds $ 3,639,582 $ (63,938) $ 98,867 $ (5,256) $ 3,738,449 $ (69,194) Mortgage backed securities 222,176 (3,545) 46,809 (1,865) 268,985 (5,410) Municipal bonds 26,665 (385) 16,361 (1,024) 43,026 (1,409) Commercial mortgage backed securities 675,603 (2,805) 5,908 (312) 681,511 (3,117) U.S. government and government agencies 4,211,621 (44,180) 33,373 (1,787) 4,244,994 (45,967) Non-U.S. government securities 1,511,301 (31,983) 62,957 (2,766) 1,574,258 (34,749) Asset backed securities 1,667,002 (9,853) 33,082 (1,255) 1,700,084 (11,108) Total 11,953,950 (156,689) 297,357 (14,265) 12,251,307 (170,954) Short-term investments 284,733 (590) — — 284,733 (590) Total $ 12,238,683 $ (157,279) $ 297,357 $ (14,265) $ 12,536,040 $ (171,544) December 31, 2020 Fixed maturities (1): Corporate bonds $ 747,442 $ (33,086) $ 3,934 $ (1,302) $ 751,376 $ (34,388) Mortgage backed securities 284,619 (4,788) 3,637 (240) 288,256 (5,028) Municipal bonds 67,937 (3,835) — — 67,937 (3,835) Commercial mortgage backed securities 126,624 (2,916) 2,655 (38) 129,279 (2,954) U.S. government and government agencies 1,285,907 (12,611) — — 1,285,907 (12,611) Non-U.S. government securities 543,844 (7,658) 2,441 (402) 546,285 (8,060) Asset backed securities 634,470 (9,110) 57,737 (1,605) 692,207 (10,715) Total 3,690,843 (74,004) 70,404 (3,587) 3,761,247 (77,591) Short-term investments 97,920 (2,063) — — 97,920 (2,063) Total $ 3,788,763 $ (76,067) $ 70,404 $ (3,587) $ 3,859,167 $ (79,654) (1) In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities pledged. For purposes of this table, the Company has excluded the collateral received and reinvested and included the fixed maturities pledged. See “—Securities Lending Agreements.” In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions. |
Contractual maturities of the Company's fixed maturities and fixed maturities pledged under securities lending arrangements | December 31, 2021 December 31, 2020 Maturity Estimated Fair Value Amortized Cost Estimated Fair Value Amortized Cost Due in one year or less $ 300,889 $ 299,772 $ 348,200 $ 339,951 Due after one year through five years 8,355,255 8,339,387 10,629,959 10,340,819 Due after five years through 10 years 4,689,155 4,684,393 4,881,564 4,654,754 Due after 10 years 505,758 493,927 482,180 448,139 13,851,057 13,817,479 16,341,903 15,783,663 Mortgage backed securities 408,477 411,110 630,001 626,368 Commercial mortgage backed securities 1,046,484 1,047,867 389,900 384,254 Asset backed securities 2,692,091 2,697,367 1,634,804 1,627,384 Total (1) $ 17,998,109 $ 17,973,823 $ 18,996,608 $ 18,421,669 (1) In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities pledged. For purposes of this table, the Company has excluded the collateral received and reinvested and included the fixed maturities pledged. See “—Securities Lending Agreements.” In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions. |
Summary of securities lending transactions accounted for as secured borrowings, with significant investment categories | The carrying value of collateral held under the Company’s securities lending transactions by significant investment category and remaining contractual maturity of the underlying agreements was as follows at December 31, 2020 (no balances at December 31, 2021 due to the termination of the program): Remaining Contractual Maturity of the Agreements Overnight and Continuous Less than 30 Days 30-90 Days 90 Days or More Total December 31, 2020 U.S. government and government agencies $ 142,317 $ — $ 139,290 $ — $ 281,607 Corporate bonds 3,021 — — — 3,021 Equity securities 16,461 — — — 16,461 Total $ 161,799 $ — $ 139,290 $ — $ 301,089 Gross amount of recognized liabilities for securities lending in offsetting disclosure in Note 11 — Amounts related to securities lending not included in offsetting disclosure in Note 11 $ 301,089 |
Components of net investment income | The components of net investment income were derived from the following sources: Year Ended December 31, 2021 2020 2019 Fixed maturities $ 330,061 $ 412,481 $ 505,399 Term loans 34,843 84,149 98,949 Equity securities 42,396 28,958 15,857 Short-term investments 6,928 10,840 15,820 Other (1) 62,895 72,395 80,618 Gross investment income 477,123 608,823 716,643 Investment expenses (88,005) (89,215) (88,905) Net investment income $ 389,118 $ 519,608 $ 627,738 (1) Includes income distributions from investment funds and other items |
Summary of net realized gains (losses) | Net realized gains (losses) were as follows: Year Ended December 31, 2021 2020 2019 Available for sale securities: Gross gains on investment sales $ 313,886 $ 595,941 $ 235,655 Gross losses on investment sales (156,791) (117,282) (104,612) Change in fair value of assets and liabilities accounted for using the fair value option: Fixed maturities 7,953 15,881 41,910 Other investments 116,781 13,656 (35,734) Equity securities 13,028 14,629 15,869 Short-term investments 601 2,279 3,801 Equity securities, at fair value : Net realized gains (losses) on securities sold 122,606 26,849 11,313 Net unrealized gains (losses) on equity securities still held at reporting date 48,746 102,394 97,768 Allowance for credit losses: Investments related (2,100) (3,597) — Underwriting related 1,062 (10,007) — Net impairment losses — (533) (3,165) Derivative instruments (1) (32,390) 179,675 119,741 Other (2) (53,537) 3,575 (19,348) Net realized gains (losses) $ 379,845 $ 823,460 $ 363,198 (1) See Note 11 for information on the Company’s derivative instruments. (2) 2021 periods reflected $33.1 million of losses related to the Company’s deconsolidation of Somers. |
Other investments | The following table summarizes the Company’s other investments and other investable assets: December 31, 2021 2020 Fixed maturities $ 416,698 $ 843,354 Other investments 1,432,553 2,331,885 Short-term investments 97,806 557,008 Equity securities 26,493 92,549 Investments accounted for using the fair value option 1,973,550 3,824,796 Other investable assets (1) — 500,000 Total other investments $ 1,973,550 $ 4,324,796 (1) Participation interests in a receivable of a reverse repurchase agreement. The following table summarizes the Company’s other investments, as detailed in the previous table, by strategy: December 31, 2021 2020 Lending 536,345 572,636 Term loan investments 484,950 1,231,731 Investment grade fixed income 147,810 138,646 Private equity 91,126 48,750 Energy 81,692 65,813 Credit related funds 70,278 90,780 Infrastructure 20,352 165,516 Real estate — 18,013 Total $ 1,432,553 $ 2,331,885 |
Investments accounted for using the equity method | The following table summarizes the Company’s investments accounted for using the equity method, by strategy: December 31, 2021 2020 Credit related funds $ 1,022,334 $ 740,060 Private equity 436,042 235,289 Real estate 396,395 258,518 Equities 395,090 343,058 Lending 376,649 179,629 Infrastructure 230,070 175,882 Energy 119,141 115,453 Fixed income 101,890 — Total $ 3,077,611 $ 2,047,889 A summary of financial information for the Company’s investment funds and operating affiliates accounted for using the equity method is as follows: December 31, 2021 2020 Invested assets $ 58,508,009 $ 44,131,377 Total assets 69,648,905 49,078,464 Total liabilities 17,944,325 6,054,189 Net assets $ 51,704,580 $ 43,024,275 Year Ended December 31, 2021 2020 2019 Total revenues $ 11,785,949 $ 5,762,098 $ 164,669 Total expenses 3,238,606 1,656,029 528,762 Net income (loss) $ 8,547,343 $ 4,106,069 $ (364,093) |
Summary of investments in limited partnership interests where the Company has a variable interest | The following table summarizes investments in limited partnership interests where the Company has a variable interest by balance sheet item: December 31, 2021 2020 Investments accounted for using the equity method (1) $ 3,077,611 $ 2,047,889 Investments accounted for using the fair value option (2) 170,595 184,720 Total $ 3,248,206 $ 2,232,609 (1) Aggregate unfunded commitments were $2.6 billion at December 31, 2021, compared to $1.8 billion at December 31, 2020. |
Roll forward of the allowance for expected credit losses of securities classified as available for sale | The following table provides a roll forward of the allowance for expected credit losses of the Company’s securities classified as available for sale: Year Ended December 31, 2021 Structured Securities (1) Municipal Corporate Total Balance at beginning of period $ 1,490 $ 11 $ 896 $ 2,397 Additions for current-period provision for expected credit losses 602 — 2,858 3,460 Additions (reductions) for previously recognized expected credit losses (847) (9) (320) (1,176) Reductions due to disposals (3) (443) — (1,355) (1,798) Balance at end of period $ 802 $ 2 $ 2,079 $ 2,883 Year Ended December 31, 2020 Balance at beginning of period $ — $ — $ — $ — Cumulative effect of accounting change (2) 517 — 117 634 Additions for current-period provision for expected credit losses 2,942 67 7,644 10,653 Additions (reductions) for previously recognized expected credit losses (1,398) 6 (5,638) (7,030) Reductions due to disposals (571) (62) (1,227) (1,860) Balance at end of period $ 1,490 $ 11 $ 896 $ 2,397 (1) Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities. (2) Adoption of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)”. (3) Reduction for the 2021 periods primarily related to the Company’s deconsolidation of Somers. |
Summary of restricted assets | The following table details the value of the Company’s restricted assets: December 31, 2021 2020 Assets used for collateral or guarantees: Affiliated transactions $ 4,223,955 $ 4,643,334 Third party agreements 2,721,160 3,083,324 Deposits with U.S. regulatory authorities 798,100 827,552 Deposits with non-U.S. regulatory authorities 506,517 179,099 Total restricted assets (1) $ 8,249,732 $ 8,733,309 (1) 2020 balances included $1.036 billion related to Somers. See note 12 . |
Reconciliation of cash and restricted cash | The following table details reconciliation of cash and restricted cash within the Consolidated Balance Sheets: December 31, 2021 2020 2019 Cash $ 858,668 $ 906,448 $ 726,230 Restricted cash (included in ‘other assets’) 456,103 384,096 177,468 Cash and restricted cash $ 1,314,771 $ 1,290,544 $ 903,698 |
Fair Value (Tables)
Fair Value (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair value hierarchy | The following table presents the Company’s financial assets and liabilities measured at fair value by level at December 31, 2021: Fair Value Measurement Using: Estimated Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Assets measured at fair value: Available for sale securities: Fixed maturities: Corporate bonds $ 6,553,333 $ — $ 6,553,320 $ 13 Mortgage backed securities 408,477 — 408,477 — Municipal bonds 404,666 — 404,666 — Commercial mortgage backed securities 1,046,484 — 1,046,484 — U.S. government and government agencies 4,772,764 4,744,517 28,247 — Non-U.S. government securities 2,120,294 — 2,120,294 — Asset backed securities 2,692,091 — 2,688,744 3,347 Total 17,998,109 4,744,517 13,250,232 3,360 Short-term investments 1,734,716 1,052,822 681,894 — Equity securities, at fair value 1,804,170 1,762,864 38,388 2,918 Derivative instruments (3) 127,121 — 127,121 — Residential mortgage loans 49,847 — 49,847 — Fair value option: Corporate bonds 388,546 — 388,546 — Non-U.S. government bonds 23,785 — 23,785 — Asset backed securities 4,367 — 4,367 — Short-term investments 97,806 528 97,278 — Equity securities 26,493 21,745 — 4,748 Other investments 310,798 20,352 262,465 27,981 Other investments measured at net asset value (1) 1,121,755 Total 1,973,550 42,625 776,441 32,729 Total assets measured at fair value $ 23,687,513 $ 7,602,828 $ 14,923,923 $ 39,007 Liabilities measured at fair value: Contingent consideration liabilities $ (16,960) $ — $ — $ (16,960) Securities sold but not yet purchased (2) — — — — Derivative instruments (3) (54,224) — (54,224) — Total liabilities measured at fair value $ (71,184) $ — $ (54,224) $ (16,960) (1) In accordance with applicable accounting guidance, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets. (2) Represents the Company’s obligations to deliver securities that it did not own at the time of sale. Such amounts are included in “other liabilities” on the Company’s consolidated balance sheets. (3) See Note 11. The following table presents the Company’s financial assets and liabilities measured at fair value by level at December 31, 2020: Fair Value Measurement Using: Estimated Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Assets measured at fair value (1): Available for sale securities: Fixed maturities: Corporate bonds $ 7,856,571 $ — $ 7,856,558 $ 13 Mortgage backed securities 630,001 — 630,001 — Municipal bonds 494,522 — 494,522 — Commercial mortgage backed securities 389,900 — 389,900 — U.S. government and government agencies 5,557,077 5,463,356 93,721 — Non-U.S. government securities 2,433,733 — 2,433,733 — Asset backed securities 1,634,804 — 1,631,378 3,426 Total 18,996,608 5,463,356 13,529,813 3,439 Equity securities, at fair value 1,460,959 1,401,653 17,291 42,015 Short-term investments 1,924,922 1,920,565 4,357 — Derivative instruments (4) 177,383 — 177,383 — Fair value option: Corporate bonds 651,294 — 650,309 985 Non-U.S. government bonds 35,263 — 35,263 — Mortgage backed securities 3,282 — 3,282 — Commercial mortgage backed securities 1,090 — 1,090 — Asset backed securities 152,151 — 152,151 — U.S. government and government agencies 274 164 110 — Short-term investments 557,008 420,131 136,877 — Equity securities 92,549 23,373 188 68,988 Other investments 1,134,229 51,149 1,015,977 67,103 Other investments measured at net asset value (2) 1,197,656 Total 3,824,796 494,817 1,995,247 137,076 Total assets measured at fair value $ 26,384,668 $ 9,280,391 $ 15,724,091 $ 182,530 Liabilities measured at fair value: Contingent consideration liabilities $ (461) $ — $ — $ (461) Securities sold but not yet purchased (3) (21,679) — (21,679) — Derivative instruments (4) (108,705) — (108,705) — Total liabilities measured at fair value $ (130,845) $ — $ (130,384) $ (461) (1) In securities lending transactions, the Company receives collateral in excess of the fair value of the securities pledged. For purposes of this table, the Company has excluded the collateral received under securities lending, at fair value and included the securities pledged under securities lending, at fair value. See Note 9. (2) In accordance with applicable accounting guidance, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets. (3) Represents the Company’s obligations to deliver securities that it did not own at the time of sale. Such amounts are included in “other liabilities” on the Company’s consolidated balance sheets. (4) See Note 11. |
Rollforward of Level 3 investments | The following table presents a reconciliation of the beginning and ending balances for all financial assets and liabilities measured at fair value on a recurring basis using Level 3 inputs for 2021 and 2020: Assets Liabilities Available For Sale Fair Value Option Fair Value Structured Securities (1) Corporate Bonds Corporate Bonds Other Investments Equity Securities Equity Securities Contingent Year Ended December 31, 2021 Balance at beginning of year $ 3,426 $ 13 $ 985 $ 67,103 $ 68,988 $ 42,015 $ (461) Total gains or (losses) (realized/unrealized) Included in earnings (2) (135) — 13 868 4,941 1,958 — Included in other comprehensive income 133 — — — — — — Purchases, issuances, sales and settlements Purchases — — — 13,213 — 5,718 (16,494) Issuances — — — — — — — Sales (3) — — (998) (53,203) (69,181) (46,773) — Settlements (77) — — — — — (5) Transfers in and/or out of Level 3 — — — — — — — Balance at end of year $ 3,347 $ 13 $ — $ 27,981 $ 4,748 $ 2,918 $ (16,960) Year Ended December 31, 2020 Balance at beginning of year $ 5,216 $ 8,851 $ 932 $ 68,817 $ 58,094 $ 55,889 $ (7,998) Total gains or (losses) (realized/unrealized) Included in earnings (2) — (5,865) (13) (314) 10,894 8,214 (72) Included in other comprehensive income (169) 397 — — — — — Purchases, issuances, sales and settlements Purchases — — 66 52,449 — 4,030 — Issuances — — — — — — — Sales — — — (56,833) — (26,118) — Settlements (1,413) (1,462) — — — — 7,609 Transfers in and/or out of Level 3 (208) (1,908) — 2,984 — — — Balance at end of year $ 3,426 $ 13 $ 985 $ 67,103 $ 68,988 $ 42,015 $ (461) (1) Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities. (2) Gains or losses were included in net realized gains (losses). (3) Sales for the 2021 period primarily relates to the Company’s deconsolidation of Somers. |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair value and notional amount of derivatives | The following table summarizes information on the fair values and notional values of the Company’s derivative instruments: Estimated Fair Value Asset Liability Derivatives Notional December 31, 2021 Futures contracts (2) $ 34,999 $ (9,808) $ 2,826,564 Foreign currency forward contracts (2) 7,734 (11,390) 915,962 TBAs 11,227 — 11,227 Other (2) 73,161 (33,026) 3,736,773 Total $ 127,121 $ (54,224) December 31, 2020 Futures contracts (2) $ 11,046 $ (4,496) $ 3,099,796 Foreign currency forward contracts (2) 52,716 (6,202) 1,656,729 TBAs — — — Other (2) 113,621 (98,007) 5,763,919 Total $ 177,383 $ (108,705) (1) Represents the absolute notional value of all outstanding contracts, consisting of long and short positions. (2) The fair value of asset derivatives are included in ‘other assets’ and the fair value of liability derivatives are included in ‘other liabilities.’ |
Summary of net realized gains (losses) recorded in the consolidated statements of income | Realized and unrealized contract gains and losses on the Company’s derivative instruments are reflected in net realized gains (losses) in the consolidated statements of income, as summarized in the following table: Derivatives not designated as hedging instruments Year Ended December 31, 2021 2020 2019 Net realized gains (losses): Futures contracts $ (15,262) $ 114,987 $ 114,123 Foreign currency forward contracts (39,755) 49,974 (9,499) TBAs (233) 1,129 463 Other 22,860 13,585 14,654 Total $ (32,390) $ 179,675 $ 119,741 |
Variable Interest Entity and _2
Variable Interest Entity and Noncontrolling Interests (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Variable Interest Entity and Noncontrolling Interest Disclosure [Abstract] | |
Carrying amount of assets and liabilities of consolidated VIE | The following table provides the carrying amount and balance sheet caption in which the assets and liabilities of Somers were reported: December 31, 2020 Assets Investments accounted for using the fair value option (1) $ 1,790,385 Fixed maturities available for sale, at fair value 655,249 Equity securities, at fair value 52,410 Cash 211,451 Accrued investment income 14,679 Premiums receivable 224,377 Reinsurance recoverable on unpaid and paid losses and LAE 286,590 Ceded unearned premiums 122,339 Deferred acquisition costs, net 53,705 Receivable for securities sold 37,423 Goodwill and intangible assets 7,650 Other assets 75,801 Total assets of consolidated VIE $ 3,532,059 Liabilities Reserves for losses and loss adjustment expenses $ 1,519,583 Unearned premiums 407,714 Reinsurance balances payable 63,269 Revolving credit agreement borrowings 155,687 Senior notes 172,689 Payable for securities purchased 25,881 Other liabilities 193,494 Total liabilities of consolidated VIE $ 2,538,317 Redeemable noncontrolling interests $ 52,398 (1) Included in “other investments” on the Company’s balance sheet. |
Summary of VIE cash flows | The following table summarizes Somers’ cash flow from operating, investing and financing activities. Year Ended December 31, 2021 2020 2019 Total cash provided by (used for): Operating activities 46,991 181,736 239,284 Investing activities 96,325 258,589 (140,620) Financing activities (2,042) (335,776) (61,433) |
Activity in non-redeemable noncontrolling interests | The following table sets forth activity in the non-redeemable noncontrolling interests: December 31, 2021 2020 Balance, beginning of year $ 823,007 $ 762,777 Impact of deconsolidation of Somers (918,874) — Additional paid in capital attributable to noncontrolling interests 22,113 1,334 Repurchases attributable to non-redeemable noncontrolling interests — (2,867) Amounts attributable to noncontrolling interests 78,314 53,076 Other amounts attributable to noncontrolling interests — (375) Other comprehensive (income) loss attributable to noncontrolling interests (4,560) 9,062 Balance, end of year $ — $ 823,007 |
Activity in redeemable noncontrolling interest | The following table sets forth activity in the redeemable noncontrolling interests: December 31, 2021 2020 2019 Balance, beginning of year $ 58,548 $ 55,404 $ 206,292 Impact of deconsolidation of Somers (48,919) — — Redemption of noncontrolling interests — — (157,709) Accretion of preference share issuance costs — 93 244 Other (396) 3,051 6,577 Balance, end of year $ 9,233 $ 58,548 $ 55,404 |
Portion of income or loss attributable to noncontrolling interests | The portion of income or loss attributable to third party investors is recorded in the consolidated statements of income in ‘net (income) loss attributable to noncontrolling interests’ as summarized in the table below: December 31, 2021 2020 2019 Amounts attributable to non-redeemable noncontrolling interests $ (78,314) $ (53,076) $ (40,072) Amounts attributable to redeemable noncontrolling interests (4,299) (7,114) (16,909) Net (income) loss attributable to noncontrolling interests $ (82,613) $ (60,190) $ (56,981) |
Total assets and maximum loss exposure of VIE | The following table presents the total assets of the Bellemeade entities, as well as the Company’s maximum exposure to loss associated with these VIEs, calculated as the maximum historical observable spread between the benchmark index for each respective transaction and short term invested trust asset yields. The benchmark index for agreements effective prior to 2021 is based on one-month LIBOR, while the 2021 agreements benchmark index is based on the Secured Overnight Financing Rate (“SOFR”). SOFR is a measure of the cost of borrowing cash overnight, collateralized by U.S. Treasury securities, and is based on directly observable U.S. Treasury-backed repurchase transactions. Dec 31, 2021 Dec 31, 2020 Maximum Exposure to Loss Maximum Exposure to Loss Bellemeade Entities (Issue Date) Total VIE Assets On-Balance Sheet (Asset) Liability Off-Balance Sheet Total Total VIE Assets On-Balance Sheet (Asset) Liability Off-Balance Sheet Total Bellemeade 2017-1 Ltd. (Oct-17) $ 108,368 $ (159) $ 424 $ 265 $ 145,573 $ (245) $ 844 $ 599 Bellemeade 2018-1 Ltd. (Apr-18) 181,136 (528) 1,268 740 250,095 (903) 2,245 1,342 Bellemeade 2018-2 Ltd. (Aug-18) — — — — 108,395 (138) 280 142 Bellemeade 2018-3 Ltd. (Oct-18) 302,563 (1,018) 2,496 1,478 302,563 (1,320) 3,262 1,942 Bellemeade 2019-1 Ltd. (Mar-19) 181,324 (380) 5,807 5,427 219,256 (1,361) 8,461 7,100 Bellemeade 2019-2 Ltd. (Apr-19) 398,316 (515) 3,998 3,483 398,316 (730) 5,201 4,471 Bellemeade 2019-3 Ltd. (Jul-19) 409,859 (584) 3,190 2,606 528,084 (861) 5,079 4,218 Bellemeade 2019-4 Ltd. (Oct-19) 411,954 (462) 4,759 4,297 468,737 (890) 6,676 5,786 Bellemeade 2020-1 Ltd. (Jun-20) — — — — 275,068 (178) 1,012 834 Bellemeade 2020-2 Ltd. (Sep-20) (1) 217,766 (177) 1,984 1,807 423,420 (556) 6,839 6,283 Bellemeade 2020-3 Ltd. (Nov-20) (2) 348,818 (128) 5,793 5,665 418,158 (631) 9,605 8,974 Bellemeade 2020-4 Ltd. (Dec-20) (3) 176,826 (50) 1,630 1,580 321,393 (156) 6,816 6,660 Bellemeade 2021-1 Ltd. (Mar-21) (4) 568,986 (303) 3,283 2,980 — — — — Bellemeade 2021-2 Ltd. (Jun-21) (5) 522,807 281 4,124 4,405 — — — — Bellemeade 2021-3 Ltd. (Sep-21) (6) 507,873 (411) 3,446 3,035 — — — — Total $ 4,336,596 $ (4,434) $ 42,202 $ 37,768 $ 3,859,058 $ (7,969) $ 56,320 $ 48,351 (1) At December 31, 2021, $1 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). (2) At December 31, 2021, $16 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). (3) At December 31, 2021, $9 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). (4) At December 31, 2021, $61 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). (5) At December 31, 2021, $93 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). (6) At December 31, 2021, $131 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). |
Other Comprehensive Income (Tab
Other Comprehensive Income (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Comprehensive Income Note Disclosure [Abstract] | |
Schedule of changes in each component of AOCI | The following table presents the changes in each component of AOCI, net of noncontrolling interests: Unrealized Appreciation on Available-For-Sale Investments Foreign Currency Translation Adjustments Total Year Ended December 31, 2021 Beginning balance $ 501,295 $ (12,400) $ 488,895 Other comprehensive income (loss) before reclassifications (371,741) (65,686) (437,427) Amounts reclassified from accumulated other comprehensive income (116,068) — (116,068) Net current period other comprehensive income (loss) (487,809) (65,686) (553,495) Ending balance $ 13,486 $ (78,086) $ (64,600) Year Ended December 31, 2020 Beginning balance $ 258,486 $ (46,395) $ 212,091 Other comprehensive income (loss) before reclassifications 668,996 33,995 702,991 Amounts reclassified from accumulated other comprehensive income (426,187) — (426,187) Net current period other comprehensive income (loss) 242,809 33,995 276,804 Ending balance $ 501,295 $ (12,400) $ 488,895 Year Ended December 31, 2019 Beginning balance $ (114,178) $ (64,542) $ (178,720) Other comprehensive income (loss) before reclassifications 491,605 18,147 509,752 Amounts reclassified from accumulated other comprehensive income (118,941) — (118,941) Net current period other comprehensive income (loss) 372,664 18,147 390,811 Ending balance $ 258,486 $ (46,395) $ 212,091 |
Details about amounts reclassified from AOCI | The following tables present details about amounts reclassified from accumulated other comprehensive income and the tax effects allocated to each component of other comprehensive income (loss): Consolidated Statement of Income Amounts Reclassified from AOCI Details About Line Item That Includes Year Ended December 31, AOCI Components Reclassification 2021 2020 2019 Unrealized appreciation on available-for-sale investments Net realized gains (losses) $ 157,095 $ 478,659 $ 131,043 Provision for credit losses (2,099) (3,597) — Other-than-temporary impairment losses — (533) (3,165) Total before tax 154,996 474,529 127,878 Income tax (expense) benefit (38,928) (48,342) (8,937) Net of tax $ 116,068 $ 426,187 $ 118,941 |
Schedule of tax effects allocated to each component of other comprehensive income (loss) | Following are the related tax effects allocated to each component of other comprehensive income (loss): Before Tax Tax Expense Net of Tax Amount (Benefit) Amount Year Ended December 31, 2021 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ (406,774) $ (19,845) $ (386,929) Less reclassification of net realized gains (losses) included in net income 154,996 38,928 116,068 Foreign currency translation adjustments (64,423) 59 (64,482) Other comprehensive income (loss) $ (626,193) $ (58,714) $ (567,479) Year Ended December 31, 2020 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ 754,572 $ 75,855 $ 678,717 Less reclassification of net realized gains (losses) included in net income 474,529 48,342 426,187 Foreign currency translation adjustments 33,706 370 33,336 Other comprehensive income (loss) $ 313,749 $ 27,883 $ 285,866 Year Ended December 31, 2019 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ 562,576 $ 61,805 $ 500,771 Less reclassification of net realized gains (losses) included in net income 127,878 8,937 118,941 Foreign currency translation adjustments 18,463 353 18,110 Other comprehensive income (loss) $ 453,161 $ 53,221 $ 399,940 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of computation of basic and diluted earnings per common share | The following table sets forth the computation of basic and diluted earnings per common share: Year Ended December 31, 2021 2020 2019 Numerator: Net income $ 2,239,462 $ 1,465,711 $ 1,693,300 Amounts attributable to noncontrolling interests (82,613) (60,190) (56,981) Net income available to Arch 2,156,849 1,405,521 1,636,319 Preferred dividends (48,343) (41,612) (41,612) Loss on redemption of preferred shares (15,101) — — Net income available to Arch common shareholders $ 2,093,405 $ 1,363,909 $ 1,594,707 Denominator: Weighted average common shares outstanding 391,748,715 403,062,179 401,802,815 Effect of dilutive common share equivalents: Nonvested restricted shares 1,996,524 1,682,309 1,673,770 Stock options (1) 6,600,697 5,514,967 8,132,893 Weighted average common shares and common share equivalents outstanding – diluted 400,345,936 410,259,455 411,609,478 Earnings per common share: Basic $ 5.34 $ 3.38 $ 3.97 Diluted $ 5.23 $ 3.32 $ 3.87 (1) Certain stock options were not included in the computation of diluted earnings per share where the exercise price of the stock options exceeded the average market price and would have been anti-dilutive or where, when applying the treasury stock method to in-the-money options, the sum of the proceeds, including unrecognized compensation, exceeded the average market price and would have been anti-dilutive. For 2021, 2020 and 2019, the number of stock options excluded were 2,398,608, 2,249,821 and 1,302,017, respectively. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Components of income taxes attributable to operations | The components of income taxes attributable to operations were as follows: Year Ended December 31, 2021 2020 2019 Current expense (benefit): United States $ 284,274 $ 181,571 $ 139,407 Non-U.S. 11,259 16,091 4,954 295,533 197,662 144,361 Deferred expense (benefit): United States (123,261) (89,170) 11,849 Non-U.S. (43,690) 3,346 (400) (166,951) (85,824) 11,449 Income tax expense $ 128,582 $ 111,838 $ 155,810 |
Schedule of income or loss before income taxes by jurisdiction | The Company’s income or loss before income taxes was earned in the following jurisdictions: Year Ended December 31, 2021 2020 2019 Income (Loss) Before Income Taxes: Bermuda $ 1,518,616 $ 1,114,117 $ 1,122,952 United States 643,239 409,893 701,480 Other 206,187 53,539 24,678 Total $ 2,368,042 $ 1,577,549 $ 1,849,110 |
Reconciliation of the differences between the provision for income taxes and the expected tax provision at the weighted average tax rate | A reconciliation of the difference between the provision for income taxes and the expected tax provision at the weighted average tax rate follows: Year Ended December 31, 2021 2020 2019 Expected income tax expense (benefit) computed on pre-tax income at weighted average income tax rate $ 158,269 $ 111,947 $ 149,799 Addition (reduction) in income tax expense (benefit) resulting from: Tax-exempt investment income (23,572) (1,824) (3,091) Meals and entertainment 379 547 1,134 State taxes, net of U.S. federal tax benefit 20,978 5,027 3,314 Foreign branch taxes 1,998 2,094 1,231 Prior year adjustment (1,432) 3,983 632 Foreign exchange gains & losses 1,190 (1,736) 436 Changes in applicable tax rate 447 — — Dividend withholding taxes 12,211 7,105 6,510 Change in valuation allowance (40,425) 13,190 1,628 Contingent consideration — 9 190 Share based compensation (5,339) (2,533) (6,592) Intercompany loan write-off — (22,083) — Other 3,878 (3,888) 619 Income tax expense (benefit) $ 128,582 $ 111,838 $ 155,810 |
Significant components of deferred income tax assets and liabilities | Significant components of the Company’s deferred income tax assets and liabilities were as follows: December 31, 2021 2020 Deferred income tax assets: Net operating loss $ 87,960 $ 67,142 Uncrystallized losses — 2,926 Discounting of net loss reserves 72,001 74,247 Net unearned premium reserve 75,483 66,368 Compensation liabilities 28,062 27,351 Foreign tax credit carryforward 20,058 19,160 Interest expense 755 622 Goodwill and intangible assets — 14,450 Bad debt reserves 10,252 10,842 Depreciation and amortization 115,041 — Lease liability 21,453 23,604 Net unrealized foreign exchange gains 166 165 Other, net — 2,318 Deferred tax assets before valuation allowance 431,231 309,195 Valuation allowance (43,953) (88,255) Deferred tax assets net of valuation allowance 387,278 220,940 Deferred income tax liabilities: Depreciation and amortization — (495) Deposit accounting liability (1,578) (1,751) Goodwill and intangibles (70,549) — Lloyds year of account deferral (12,514) — Contingency reserve (49,486) (64,593) Deferred policy acquisition costs (25,612) (42,045) Investment related (7,492) (9,571) Net unrealized appreciation of investments (8,377) (66,681) Right-of-use asset (17,406) (19,239) Other, net (218) (843) Total deferred tax liabilities (193,232) (205,218) Net deferred income tax assets $ 194,046 $ 15,722 |
Summary of operating loss carryforwards | At December 31, 2021, the Company’s net operating loss carryforwards and tax credits were as follows: Year Ended December 31, 2021 Expiration Operating Loss Carryforwards United Kingdom $ 259,235 No expiration Ireland 9,032 No expiration Australia 39,981 No expiration Hong Kong 23,203 No expiration United States (1) 29,508 2029 - 2038 Tax Credits U.K. foreign tax credits 20,058 No expiration (1) On January 30, 2014, the Company’s U.S. mortgage operations underwent an ownership change for U.S. federal income tax purposes as a result of the Company’s acquisition of the CMG Entities. As a result of this ownership change, a limitation has been imposed upon the utilization of approximately $7.6 million of the Company’s existing U.S. net operating loss carryforwards. Utilization is limited to approximately $0.6 million per year in accordance with Section 382 of the Internal Revenue Code of 1986 as amended (“the Code”). |
Summary of tax credit carryforwards | At December 31, 2021, the Company’s net operating loss carryforwards and tax credits were as follows: Year Ended December 31, 2021 Expiration Operating Loss Carryforwards United Kingdom $ 259,235 No expiration Ireland 9,032 No expiration Australia 39,981 No expiration Hong Kong 23,203 No expiration United States (1) 29,508 2029 - 2038 Tax Credits U.K. foreign tax credits 20,058 No expiration (1) On January 30, 2014, the Company’s U.S. mortgage operations underwent an ownership change for U.S. federal income tax purposes as a result of the Company’s acquisition of the CMG Entities. As a result of this ownership change, a limitation has been imposed upon the utilization of approximately $7.6 million of the Company’s existing U.S. net operating loss carryforwards. Utilization is limited to approximately $0.6 million per year in accordance with Section 382 of the Internal Revenue Code of 1986 as amended (“the Code”). |
Reconciliation of the beginning and ending amount of unrecognized tax benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: December 31, 2021 2020 Balance at beginning of year $ 2,008 $ 2,008 Additions based on tax positions related to the current year — — Additions for tax positions of prior years — — Reductions for tax positions of prior years — — Settlements — — Balance at end of year $ 2,008 $ 2,008 |
Summary of open tax years potentially subject to examination, by jurisdiction | The following table details open tax years that are potentially subject to examination by local tax authorities, in the following major jurisdictions: Jurisdiction Tax Years United States 2015-2021 United Kingdom 2020-2021 Ireland 2017-2021 Canada 2017-2021 Switzerland 2018-2021 Denmark 2017-2021 Australia 2017-2021 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Additional information regarding operating leases | Additional information regarding the Company’s operating leases is as follows: December 31, 2021 2020 Operating lease costs $ 31,691 $ 31,826 Cash payments included in the measurement of lease liabilities reported in operating cash flows $ 32,094 $ 30,365 Right-of-use assets obtained in exchange for new lease liabilities $ 22,686 $ 12,060 Right-of-use assets (1) $ 106,836 $ 115,911 Operating lease liability (1) $ 126,711 $ 136,015 Weighted average discount rate 3.9 % 3.9 % Weighted average remaining lease term 5.9 years 5.8 years (1) The right-of-use assets are included in ‘ other assets |
Contractual maturities of operating lease liabilities | The following table presents the contractual maturities of the Company's operating lease liabilities at December 31, 2021: Years Ending December 31, 2022 $ 31,682 2023 25,288 2024 22,102 2025 16,253 2026 13,430 2027 and thereafter 34,173 Total undiscounted lease liability 142,928 Less: present value adjustment (16,217) Operating lease liability 126,711 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Broker concentration risk | The following table summarizes the percentage of the Company’s gross premiums written generated from or placed by the largest brokers: Broker Year Ended December 31, 2021 2020 2019 Marsh & McLennan Companies and its subsidiaries 18.3 % 13.3 % 9.6 % Aon Corporation and its subsidiaries 12.2 % 12.0 % 12.2 % |
Debt and Financing Arrangemen_2
Debt and Financing Arrangements - (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of senior notes | The Company’s senior notes payable at December 31, 2021 and 2020 were as follows: Carrying Amount at Interest Principal December 31, (Fixed) Amount 2021 2020 2034 notes (1) 7.350 % 300,000 297,488 297,367 2043 notes (2) 5.144 % 500,000 495,063 494,944 2026 notes (3) 4.011 % 500,000 497,633 497,211 2046 notes (4) 5.031 % 450,000 445,490 445,402 2050 notes (5) 3.635 % 1,000,000 988,720 988,500 Somers notes (6) 137,689 $ 2,750,000 $ 2,724,394 $ 2,861,113 (1) Senior notes of Arch Capital issued on May 4, 2004 and due May 1, 2034 (“2034 notes”). (2) Senior notes of Arch-U.S., a wholly-owned subsidiary of Arch Capital, issued on December 13, 2013 and due November 1, 2043 (“2043 notes”), fully and unconditionally guaranteed by Arch Capital. (3) Senior notes of Arch Capital Finance LLC (“Arch Finance”), a wholly-owned finance subsidiary of Arch Capital, issued on December 8, 2016 and due December 15, 2026 (“2026 notes”), fully and unconditionally guaranteed by Arch Capital. (4) Senior notes of Arch Finance issued on December 8, 2016 and due December 15, 2046 (“2046 notes”), fully and unconditionally guaranteed by Arch Capital (5) Senior notes of Arch Capital issued on June 30, 2020 and due June 30, 2050 (“2050 notes”). (6) Senior notes of Somers issued on July 2, 2019 and due July 2, 2029 (“Somers Senior Notes”), reflecting the elimination of amounts owned by Arch-U.S. Effective July 1, 2021, the Company no longer consolidates Somers in its financials. See note 12. |
Schedule of outstanding revolving credit agreement borrowings | The Company’s outstanding revolving credit agreement borrowings were as follows: Year Ended December 31, 2021 2020 Arch Capital $ — $ — Somers 155,687 Total $ — $ 155,687 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Analysis of goodwill and intangible assets | The following table shows an analysis of goodwill and intangible assets: Goodwill Intangible assets (indefinite life) Intangible assets (finite life) Total Net balance at Dec. 31, 2019 $ 326,551 $ 85,911 $ 325,621 $ 738,083 Acquisitions — — 39,178 39,178 Amortization — — (69,031) (69,031) Foreign currency movements and other adjustments (11,922) (6,692) 3,247 (15,367) Net balance at Dec. 31, 2020 314,629 79,219 299,015 692,863 Acquisitions (1) 31,677 — 318,459 350,136 Amortization — — (82,955) (82,955) Impact of deconsolidation of Somers (2) — (7,650) — (7,650) Foreign currency movements and other adjustments (1,441) (212) (5,758) (7,411) Net balance at Dec. 31, 2021 $ 344,865 $ 71,357 $ 528,761 $ 944,983 Gross balance at Dec. 31, 2021 $ 342,842 $ 70,246 $ 1,102,298 $ 1,515,386 Accumulated amortization — — (571,839) (571,839) Foreign currency movements and other adjustments 2,023 1,111 (1,698) 1,436 Net balance at Dec. 31, 2021 $ 344,865 $ 71,357 $ 528,761 $ 944,983 (1) Certain amounts for the Company’s 2021 acquisitions are considered provisional. (2) See note 12 . |
Summary of components of intangible assets | The following table presents the components of goodwill and intangible assets: Gross Balance Accumulated Foreign Currency Translation Adjustment and Other Net Dec. 31, 2021 Acquired insurance contracts $ 451,505 $ (409,592) $ 339 $ 42,252 Operating platform 52,674 (48,838) 56 3,892 Distribution relationships 602,518 (120,302) (2,207) 480,009 Goodwill 342,842 — 2,023 344,865 Insurance licenses 48,331 — — 48,331 Syndicate capacity 21,915 — 1,111 23,026 Unfavorable service contract (9,533) 9,435 — (98) Other 5,134 (2,542) 114 2,706 Total $ 1,515,386 $ (571,839) $ 1,436 $ 944,983 Dec. 31, 2020 Acquired insurance contracts $ 451,505 $ (381,349) $ 284 $ 70,440 Operating platform 52,674 (44,347) 60 8,387 Distribution relationships 285,141 (71,383) 3,450 217,208 Goodwill 318,043 — (3,414) 314,629 Insurance licenses 55,981 — — 55,981 Syndicate capacity 21,915 — 1,324 23,239 Unfavorable service contract (9,533) 9,147 — (386) Other 5,134 (1,896) 127 3,365 Total $ 1,180,860 $ (489,828) $ 1,831 $ 692,863 |
Estimated future amortization expense | The estimated remaining amortization expense for the Company’s intangible assets with finite lives is as follows: 2022 $ 109,144 2023 99,620 2024 79,410 2025 44,523 2026 35,252 2027 and thereafter 160,812 Total $ 528,761 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Roll-forward of changes in issued and outstanding Common Shares | The following table presents a roll-forward of changes in Arch Capital’s issued and outstanding Common Shares: Year Ended December 31, 2021 2020 2019 Common Shares: Shares issued and outstanding, beginning of year 579,000,841 574,617,195 570,737,283 Shares issued (1) 2,669,229 2,646,164 2,835,994 Restricted shares issued, net of cancellations 1,619,780 1,737,482 1,043,918 Shares issued and outstanding, end of year 583,289,850 579,000,841 574,617,195 Common shares in treasury, end of year (204,365,956) (172,280,199) (168,997,994) Shares issued and outstanding, end of year 378,923,894 406,720,642 405,619,201 |
Schedule of share repurchases | The Company’s repurchases under the share repurchase program were as follows: Year Ended December 31, 2021 2020 2019 Aggregate cost of shares repurchased $ 1,234,294 $ 83,472 $ 2,871 Shares repurchased 31,486,830 2,850,102 110,598 Average price per share repurchased $ 39.20 $ 29.29 $ 25.96 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Valuation assumptions | Year Ended December 31, 2021 2020 2019 Dividend yield — % — % — % Expected volatility 24.2 % 16.6 % 18.1 % Risk free interest rate 1.0 % 1.2 % 2.5 % Expected option life 6.0 years 6.0 years 6.0 years |
Option activity | A summary of stock option and SAR activity under the Company’s Long Term Incentive and Share Award Plans during 2021 is presented below: Year Ended December 31, 2021 Number of Weighted Average Exercise Price Weighted Average Contractual Term Aggregate Intrinsic Value Outstanding, beginning of year 17,839,333 $ 23.32 Granted 1,243,984 $ 35.90 Exercised (1,931,320) $ 15.57 Forfeited or expired (68,837) $ 35.39 Outstanding, end of year 17,083,160 $ 25.06 4.41 $ 331,214 Exercisable, end of year 14,730,147 $ 23.20 3.78 $ 312,966 |
Weighted average grant date fair value | Year Ended December 31, 2021 2020 2019 Weighted average grant date fair value $ 9.22 $ 8.14 $ 7.90 Aggregate intrinsic value of Options/SARs exercised $ 47,074 $ 59,723 $ 51,350 |
Unvested restricted share and unit activity | A summary of restricted share and restricted unit activity under the Company’s Long Term Incentive and Share Award Plans for 2021 is presented below: Restricted Common Shares Restricted Unit Awards Unvested Shares: Unvested balance, beginning of year 1,635,845 1,121,719 Granted 1,085,811 175,962 Vested (549,892) (555,870) Forfeited (100,927) (41,945) Unvested balance, end of year 2,070,837 699,866 Weighted Average Grant Date Fair Value: Unvested balance, beginning of year $ 36.34 $ 31.43 Granted $ 36.14 $ 35.94 Vested $ 35.94 $ 30.46 Forfeited $ 36.28 $ 32.23 Unvested balance, end of year $ 36.35 $ 33.29 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance shares and units, valuation assumptions | Year Ended December 31, 2021 2020 2019 Expected volatility 37.5 % 18.1 % 17.1 % Risk free interest rate 0.3 % 1.1 % 2.5 % |
Unvested performance share and unit activity | Performance Shares Performance Units Unvested Shares: Unvested balance, beginning of year 1,851,382 32,065 Granted 674,406 10,698 Performance adjustment (1) (2) (39,510) 11,447 Vested (624,518) (24,440) Unvested balance, end of year 1,861,760 29,770 Weighted Average Grant Date Fair Value: Unvested balance, beginning of year $ 34.42 $ 33.48 Granted $ 37.38 $ 37.38 Performance adjustment (1) (2) 24.78 24.71 Vested $ 24.78 $ 24.71 Unvested balance, end of year $ 38.93 $ 38.71 (1) The performance adjustment represents the difference between the number of performance shares granted and earned, which vested following the end of the performance period. The performance shares were granted at the maximum level of achievement. (2) The performance adjustment represents the change in PSUs, which vested following the end of the performance period. The performance units were granted at the target level of achievement. |
Share based compensation expense | The following tables present pre-tax and after-tax share-based compensation expense recognized as well as the unrecognized compensation cost associated with unvested awards and the weighted average period over which it is expected to be recognized. Year Ended December 31, 2021 2020 2019 Pre-Tax Stock options and SARs $ 12,316 $ 11,744 $ 12,866 Restricted share and unit awards 46,817 41,284 38,988 Performance awards 23,696 14,729 8,949 ESPP 3,751 2,135 3,045 Total $ 86,580 $ 69,892 $ 63,848 After-Tax Stock options and SARs $ 10,927 $ 10,388 $ 11,450 Restricted share and unit awards 39,349 34,599 32,999 Performance awards 21,920 13,380 8,295 ESPP 3,471 1,978 2,758 Total $ 75,667 $ 60,345 $ 55,502 |
Unrecognized compensation cost | December 31, 2021 Stock Options and SARs Restricted Common Performance Common Shares and Units Unrecognized compensation cost related to unvested awards $ 8,233 $ 45,936 $ 7,635 Weighted average recognition period (years) 0.91 1.23 0.52 |
Restricted Common Shares And Restricted Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Weighted average grant date fair value of restricted stock | The following table presents the weighted average grant date fair value of restricted shares and restricted unit awards granted and the aggregate fair value of restricted shares and unit awards vesting in each year. Year Ended December 31, 2021 2020 2019 Restricted shares and restricted unit awards granted 1,261,773 1,535,330 1,195,741 Weighted average grant date fair value $ 36.12 $ 37.55 $ 32.89 Aggregate fair value of vested restricted share and unit awards $ 65,477 $ 39,703 $ 46,262 |
Performance Common Shares and Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Weighted average grant date fair value of restricted stock | The following table presents the weighted average grant date fair values of performance awards granted. Year Ended December 31, 2021 2020 2019 Performance awards 685,104 557,204 696,360 Weighted average grant date fair value $ 37.38 $ 44.17 $ 36.05 |
Statutory Information (Tables)
Statutory Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Statutory Information [Abstract] | |
Summary of statutory capital, surplus and net income | The actual and required statutory capital and surplus for the Company’s principal operating subsidiaries at December 31, 2021 and 2020: December 31, 2021 2020 Actual capital and surplus (1): Bermuda $ 17,528,510 $ 17,390,943 Ireland 958,200 883,337 United States 5,600,652 4,904,840 United Kingdom 902,002 967,440 Canada 70,063 64,286 Australia 283,693 64,507 Required capital and surplus: Bermuda $ 5,661,301 $ 5,234,121 Ireland 794,933 701,161 United States 1,717,646 1,644,324 United Kingdom 563,164 601,662 Canada 42,513 37,441 Australia 214,022 19,370 (1) Such amounts include ownership interests in affiliated insurance and reinsurance subsidiaries. The statutory net income (loss) for the Company’s principal operating subsidiaries for 2021, 2020 and 2019 was as follows: Year Ended December 31, 2021 2020 2019 Statutory net income (loss): Bermuda $ 2,370,746 $ 1,579,889 $ 1,801,486 Ireland 25,191 18,397 26,367 United States 345,790 143,271 481,188 United Kingdom 35,286 4,078 (17,423) Canada 6,985 (1,049) (1,023) Australia 11,874 (8,601) (6,199) |
General (Details)
General (Details) | Jul. 01, 2021 |
Greysbridge Holdings Ltd | Kelso And Company | |
Schedule of Equity Method Investments [Line Items] | |
Percentage ownership | 30.00% |
Greysbridge Holdings Ltd | Warburg Pincus | |
Schedule of Equity Method Investments [Line Items] | |
Percentage ownership | 30.00% |
Greysbridge Holdings Ltd | |
Schedule of Equity Method Investments [Line Items] | |
Percentage ownership | 40.00% |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Thousands | Aug. 31, 2021 | Aug. 06, 2021 | Dec. 31, 2021 | [1] | Dec. 31, 2020 |
Business Acquisition [Line Items] | |||||
Goodwill and intangible assets, acquisitions | $ 350,136 | $ 39,178 | |||
Westpac Lenders Mortgage Insurance Limited | |||||
Business Acquisition [Line Items] | |||||
Term of business exclusivity agreement | 10 years | ||||
Somerset | |||||
Business Acquisition [Line Items] | |||||
Goodwill and intangible assets, acquisitions | $ 350,100 | ||||
[1] | Certain amounts for the Company’s 2021 acquisitions are considered provisional. |
Significant Accounting Polici_3
Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Significant Accounting Policies [Line Items] | |
Premium revenue recognition period | 12 months |
Securities lending rate of collateral required (percentage) | 102.00% |
Equity method investments, time lag for reporting - low end of range | 1 month |
Equity method investments, time lag for reporting - high end of range | 3 months |
Vesting period, share-based awards | 3 years |
Requisite service period, share-based awards | 3 years |
Losses occurring | |
Significant Accounting Policies [Line Items] | |
Premium revenue recognition period | 12 months |
Risks attaching | |
Significant Accounting Policies [Line Items] | |
Premium revenue recognition period | 24 months |
Segment Information - Analysis
Segment Information - Analysis of underwriting income by segment and reconciliation to net income available to common shareholders (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | ||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | $ 12,752,487 | $ 10,088,068 | $ 8,138,960 | |
Premiums ceded | (3,734,150) | (2,650,352) | (2,099,893) | |
Net premiums written | 9,018,337 | 7,437,716 | 6,039,067 | |
Change in unearned premiums | (936,039) | (445,781) | (252,569) | |
Net premiums earned | 8,082,298 | 6,991,935 | 5,786,498 | |
Other underwriting income | 22,073 | 26,784 | 24,861 | |
Losses and loss adjustment expenses | (4,584,803) | (4,689,599) | (3,133,452) | |
Acquisition expenses, net | (1,303,178) | (1,004,842) | (840,945) | |
Other operating expenses | (998,595) | (875,176) | (800,997) | |
Underwriting income (loss) | 1,217,795 | 449,102 | 1,035,965 | |
Net investment income | 389,118 | 519,608 | 627,738 | |
Net realized gains (losses) | 379,845 | 823,460 | 363,198 | |
Equity in net income (loss) of investment funds accounted for using the equity method | 366,402 | 146,693 | 123,672 | |
Other income (loss) | 10,244 | 29 | 0 | |
Corporate expenses | (77,119) | (68,492) | (65,667) | |
Transaction costs and other | (2,038) | (13,496) | (14,444) | |
Amortization of intangible assets | (82,955) | (69,031) | (82,104) | |
Interest expense | (139,470) | (143,456) | (120,872) | |
Net foreign exchange gains (losses) | 41,529 | (83,634) | (20,609) | |
Income (loss) before income taxes and income (loss) from operating affiliates | 2,103,351 | 1,560,783 | 1,846,877 | |
Income tax (expense) benefit | (128,582) | (111,838) | (155,810) | |
Income (loss) from operating affiliates | 264,693 | 16,766 | 2,233 | |
Net income (loss) | 2,239,462 | 1,465,711 | 1,693,300 | |
Amounts attributable to redeemable noncontrolling interests | (4,299) | (7,114) | (16,909) | |
Amounts attributable to nonredeemable noncontrolling interests | (78,314) | (53,076) | (40,072) | |
Net income available to Arch | 2,156,849 | 1,405,521 | 1,636,319 | |
Preferred share dividends | (48,343) | (41,612) | (41,612) | |
Loss on redemption of preferred shares | (15,101) | 0 | 0 | |
Net income (loss) available to Arch common shareholders | $ 2,093,405 | $ 1,363,909 | $ 1,594,707 | |
Underwriting Ratios | ||||
Loss ratio | 56.70% | 67.10% | 54.20% | |
Acquisition expense ratio | 16.10% | 14.40% | 14.50% | |
Other operating expense ratio | 12.40% | 12.50% | 13.80% | |
Combined ratio | 85.20% | 94.00% | 82.50% | |
Goodwill and intangible assets | $ 944,983 | $ 692,863 | $ 738,083 | |
Total investable assets | 27,442,153 | 29,513,907 | 24,990,265 | |
Total assets | 45,100,945 | 43,282,297 | 37,885,361 | |
Total liabilities | $ 31,545,816 | 29,294,856 | 25,569,809 | |
Operating segments | Underwriting Segments | ||||
Segment Reporting Information [Line Items] | ||||
Number of segments | segment | 3 | |||
Gross premiums written | [1] | $ 12,463,788 | 9,632,691 | 7,695,645 |
Premiums ceded | (3,800,153) | (2,732,564) | (2,189,440) | |
Net premiums written | 8,663,635 | 6,900,127 | 5,506,205 | |
Change in unearned premiums | (913,305) | (468,543) | (276,396) | |
Net premiums earned | 7,750,330 | 6,431,584 | 5,229,809 | |
Other underwriting income | 21,334 | 24,739 | 22,449 | |
Losses and loss adjustment expenses | (4,325,761) | (4,249,117) | (2,680,317) | |
Acquisition expenses, net | (1,240,437) | (906,771) | (734,965) | |
Other operating expenses | (965,726) | (819,366) | (749,346) | |
Underwriting income (loss) | 1,239,740 | 481,069 | 1,087,630 | |
Net investment income | 346,808 | 401,908 | 491,067 | |
Net realized gains (losses) | 299,207 | 813,781 | 348,037 | |
Equity in net income (loss) of investment funds accounted for using the equity method | 366,402 | 146,693 | 123,672 | |
Other income (loss) | 10,244 | 29 | ||
Corporate expenses | (77,119) | (68,492) | (65,667) | |
Transaction costs and other | (1,103) | (9,456) | (14,444) | |
Amortization of intangible assets | (82,057) | (69,031) | (82,104) | |
Interest expense | (131,060) | (120,214) | (93,735) | |
Net foreign exchange gains (losses) | 42,854 | (80,161) | (9,252) | |
Income (loss) before income taxes and income (loss) from operating affiliates | 2,013,916 | 1,496,126 | 1,785,204 | |
Income tax (expense) benefit | (128,348) | (111,812) | (155,790) | |
Income (loss) from operating affiliates | 264,693 | 16,766 | 2,233 | |
Net income (loss) | 2,150,261 | 1,401,080 | 1,631,647 | |
Amounts attributable to redeemable noncontrolling interests | (2,346) | (2,997) | 0 | |
Amounts attributable to nonredeemable noncontrolling interests | 0 | 0 | 0 | |
Net income available to Arch | 2,147,915 | 1,398,083 | 1,631,647 | |
Preferred share dividends | (48,343) | (41,612) | (41,612) | |
Loss on redemption of preferred shares | (15,101) | |||
Net income (loss) available to Arch common shareholders | $ 2,084,471 | $ 1,356,471 | $ 1,590,035 | |
Underwriting Ratios | ||||
Loss ratio | 55.80% | 66.10% | 51.30% | |
Acquisition expense ratio | 16.00% | 14.10% | 14.10% | |
Other operating expense ratio | 12.50% | 12.70% | 14.30% | |
Combined ratio | 84.30% | 92.90% | 79.70% | |
Goodwill and intangible assets | $ 944,983 | $ 685,213 | $ 730,433 | |
Total investable assets | 27,442,153 | 26,856,295 | 22,285,676 | |
Total assets | 45,100,945 | 39,791,983 | 34,374,468 | |
Total liabilities | 31,545,816 | 26,789,149 | 22,977,636 | |
Operating segments | Insurance | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | [1] | 5,867,734 | 4,688,562 | 3,907,993 |
Premiums ceded | [2] | (1,719,541) | (1,525,655) | (1,266,267) |
Net premiums written | 4,148,193 | 3,162,907 | 2,641,726 | |
Change in unearned premiums | (521,725) | (291,487) | (244,646) | |
Net premiums earned | 3,626,468 | 2,871,420 | 2,397,080 | |
Other underwriting income | 0 | (31) | 0 | |
Losses and loss adjustment expenses | (2,344,365) | (2,092,453) | (1,615,475) | |
Acquisition expenses, net | (606,265) | (418,483) | (361,614) | |
Other operating expenses | (558,906) | (489,153) | (454,770) | |
Underwriting income (loss) | $ 116,932 | $ (128,700) | $ (34,779) | |
Underwriting Ratios | ||||
Loss ratio | 64.60% | 72.90% | 67.40% | |
Acquisition expense ratio | 16.70% | 14.60% | 15.10% | |
Other operating expense ratio | 15.40% | 17.00% | 19.00% | |
Combined ratio | 96.70% | 104.50% | 101.50% | |
Goodwill and intangible assets | $ 256,434 | $ 280,978 | $ 289,021 | |
Operating segments | Reinsurance | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | [1] | 5,093,930 | 3,472,086 | 2,323,223 |
Premiums ceded | [2] | (1,839,556) | (1,014,716) | (720,500) |
Net premiums written | 3,254,374 | 2,457,370 | 1,602,723 | |
Change in unearned premiums | (413,931) | (295,141) | (136,334) | |
Net premiums earned | 2,840,443 | 2,162,229 | 1,466,389 | |
Other underwriting income | 3,669 | 4,454 | 6,444 | |
Losses and loss adjustment expenses | (1,924,719) | (1,628,320) | (1,011,329) | |
Acquisition expenses, net | (536,754) | (354,048) | (239,032) | |
Other operating expenses | (212,810) | (168,011) | (141,484) | |
Underwriting income (loss) | $ 169,829 | $ 16,304 | $ 80,988 | |
Underwriting Ratios | ||||
Loss ratio | 67.80% | 75.30% | 69.00% | |
Acquisition expense ratio | 18.90% | 16.40% | 16.30% | |
Other operating expense ratio | 7.50% | 7.80% | 9.60% | |
Combined ratio | 94.20% | 99.50% | 94.90% | |
Goodwill and intangible assets | $ 183,523 | $ 18,963 | $ 2,516 | |
Operating segments | Mortgage | ||||
Segment Reporting Information [Line Items] | ||||
Gross premiums written | [1] | 1,507,825 | 1,473,999 | 1,466,265 |
Premiums ceded | [2] | (246,757) | (194,149) | (204,509) |
Net premiums written | 1,261,068 | 1,279,850 | 1,261,756 | |
Change in unearned premiums | 22,351 | 118,085 | 104,584 | |
Net premiums earned | 1,283,419 | 1,397,935 | 1,366,340 | |
Other underwriting income | 17,665 | 20,316 | 16,005 | |
Losses and loss adjustment expenses | (56,677) | (528,344) | (53,513) | |
Acquisition expenses, net | (97,418) | (134,240) | (134,319) | |
Other operating expenses | (194,010) | (162,202) | (153,092) | |
Underwriting income (loss) | $ 952,979 | $ 593,465 | $ 1,041,421 | |
Underwriting Ratios | ||||
Loss ratio | 4.40% | 37.80% | 3.90% | |
Acquisition expense ratio | 7.60% | 9.60% | 9.80% | |
Other operating expense ratio | 15.10% | 11.60% | 11.20% | |
Combined ratio | 27.10% | 59.00% | 24.90% | |
Goodwill and intangible assets | $ 505,026 | $ 385,272 | $ 438,896 | |
Operating segments | Other | ||||
Segment Reporting Information [Line Items] | ||||
Number of segments | segment | 2 | |||
Gross premiums written | [1] | $ 457,465 | 728,546 | 754,881 |
Premiums ceded | [2] | (102,763) | (190,957) | (222,019) |
Net premiums written | 354,702 | 537,589 | 532,862 | |
Change in unearned premiums | (22,734) | 22,762 | 23,827 | |
Net premiums earned | 331,968 | 560,351 | 556,689 | |
Other underwriting income | 739 | 2,045 | 2,412 | |
Losses and loss adjustment expenses | (259,042) | (440,482) | (453,135) | |
Acquisition expenses, net | (62,741) | (98,071) | (105,980) | |
Other operating expenses | (32,869) | (55,810) | (51,651) | |
Underwriting income (loss) | (21,945) | (31,967) | (51,665) | |
Net investment income | 42,310 | 117,700 | 136,671 | |
Net realized gains (losses) | 80,638 | 9,679 | 15,161 | |
Equity in net income (loss) of investment funds accounted for using the equity method | 0 | 0 | 0 | |
Other income (loss) | 0 | 0 | ||
Corporate expenses | 0 | 0 | 0 | |
Transaction costs and other | (935) | (4,040) | 0 | |
Amortization of intangible assets | (898) | 0 | 0 | |
Interest expense | (8,410) | (23,242) | (27,137) | |
Net foreign exchange gains (losses) | (1,325) | (3,473) | (11,357) | |
Income (loss) before income taxes and income (loss) from operating affiliates | 89,435 | 64,657 | 61,673 | |
Income tax (expense) benefit | (234) | (26) | (20) | |
Income (loss) from operating affiliates | 0 | 0 | 0 | |
Net income (loss) | 89,201 | 64,631 | 61,653 | |
Amounts attributable to redeemable noncontrolling interests | (1,953) | (4,117) | (16,909) | |
Amounts attributable to nonredeemable noncontrolling interests | (78,314) | (53,076) | (40,072) | |
Net income available to Arch | 8,934 | 7,438 | 4,672 | |
Preferred share dividends | 0 | 0 | 0 | |
Loss on redemption of preferred shares | 0 | |||
Net income (loss) available to Arch common shareholders | $ 8,934 | $ 7,438 | $ 4,672 | |
Underwriting Ratios | ||||
Loss ratio | 78.00% | 78.60% | 81.40% | |
Acquisition expense ratio | 18.90% | 17.50% | 19.00% | |
Other operating expense ratio | 9.90% | 10.00% | 9.30% | |
Combined ratio | 106.80% | 106.10% | 109.70% | |
Goodwill and intangible assets | $ 0 | $ 7,650 | $ 7,650 | |
Total investable assets | 0 | 2,657,612 | 2,704,589 | |
Total assets | 0 | 3,490,314 | 3,510,893 | |
Total liabilities | $ 0 | $ 2,505,707 | $ 2,592,173 | |
[1] | Certain amounts included in the gross premiums written of each segment are related to intersegment transactions. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total. | |||
[2] | Certain amounts included in the gross premiums written of each segment are related to intersegment transactions and are included in the gross premiums written of each segment. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total. |
Segment Information - Summary o
Segment Information - Summary of net premiums written and earned by major line of business and net premiums written by location (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | $ 8,082,298 | $ 6,991,935 | $ 5,786,498 | |
Net premiums written | 9,018,337 | 7,437,716 | 6,039,067 | |
Operating segments | Insurance | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 3,626,468 | 2,871,420 | 2,397,080 | |
Net premiums written | 4,148,193 | 3,162,907 | 2,641,726 | |
Operating segments | Insurance | United States | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 2,813,039 | 2,158,415 | 1,983,476 |
Operating segments | Insurance | Europe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 1,125,192 | 856,572 | 559,214 |
Operating segments | Insurance | Other geographic location | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 209,962 | 147,920 | 99,036 |
Operating segments | Insurance | Professional lines | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1],[2] | 942,817 | 655,872 | 499,224 |
Operating segments | Insurance | Property, energy, marine and aviation | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 702,693 | 517,247 | 298,966 |
Operating segments | Insurance | Programs | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 506,867 | 432,854 | 414,103 |
Operating segments | Insurance | Construction and national accounts | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 381,306 | 387,934 | 325,687 |
Operating segments | Insurance | Excess and surplus casualty | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1],[3] | 318,027 | 270,620 | 200,615 |
Operating segments | Insurance | Travel, accident and health | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 255,590 | 190,944 | 305,085 |
Operating segments | Insurance | Lenders products | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 153,958 | 114,687 | 66,079 |
Operating segments | Insurance | Other | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1],[4] | 365,210 | 301,262 | 287,321 |
Operating segments | Reinsurance | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 2,840,443 | 2,162,229 | 1,466,389 | |
Net premiums written | 3,254,374 | 2,457,370 | 1,602,723 | |
Operating segments | Reinsurance | United States | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [5] | 828,504 | 687,622 | 529,943 |
Operating segments | Reinsurance | Bermuda | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [5] | 1,557,294 | 1,001,990 | 578,618 |
Operating segments | Reinsurance | Europe and other | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [5] | 868,576 | 767,758 | 494,162 |
Operating segments | Reinsurance | Property excluding property catastrophe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [5],[6] | 836,573 | 562,208 | 362,841 |
Operating segments | Reinsurance | Other specialty | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [5],[6] | 818,801 | 626,409 | 478,517 |
Operating segments | Reinsurance | Casualty | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [5],[7] | 666,754 | 549,056 | 429,288 |
Operating segments | Reinsurance | Property catastrophe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [5],[7] | 280,738 | 237,736 | 90,934 |
Operating segments | Reinsurance | Marine and aviation | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [5] | 152,955 | 109,624 | 48,274 |
Operating segments | Reinsurance | Other | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [5],[8] | 84,622 | 77,196 | 56,535 |
Operating segments | Mortgage | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 1,283,419 | 1,397,935 | 1,366,340 | |
Net premiums written | 1,261,068 | 1,279,850 | 1,261,756 | |
Operating segments | Mortgage | United States | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 970,507 | 1,158,563 | 1,134,849 | |
Net premiums written | 914,477 | 1,021,950 | 1,032,868 | |
Operating segments | Mortgage | Other geographic location | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 312,912 | 239,372 | 231,491 | |
Net premiums written | 346,591 | 257,900 | 228,888 | |
Operating segments | Other | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 331,968 | 560,351 | 556,689 | |
Net premiums written | 354,702 | 537,589 | 532,862 | |
Operating segments | Other | United States | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [9] | 63,403 | 115,471 | 127,176 |
Operating segments | Other | Europe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [9] | 91,499 | 97,753 | 52,065 |
Operating segments | Other | Bermuda | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [9] | 199,800 | 324,365 | 353,621 |
Operating segments | Other | Property excluding property catastrophe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [9] | 6,578 | 1,130 | 3,503 |
Operating segments | Other | Other specialty | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [9],[10] | 118,356 | 186,717 | 185,547 |
Operating segments | Other | Casualty | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [9],[11] | 138,551 | 245,272 | 246,894 |
Operating segments | Other | Property catastrophe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [9] | 15,235 | 23,037 | 13,399 |
Operating segments | Other | Marine and aviation | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [9] | 190 | 429 | 0 |
Operating segments | Other | Other | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [9],[12] | $ 53,058 | $ 103,766 | $ 107,346 |
[1] | Insurance segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions. | |||
[2] | Includes professional liability, executive assurance and healthcare business. | |||
[3] | Includes casualty and contract binding business. | |||
[4] | Includes alternative markets, excess workers' compensation and surety business. | |||
[5] | Reinsurance segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions. | |||
[6] | Includes proportional motor, surety, accident and health, workers’ compensation catastrophe, agriculture, trade credit and other. | |||
[7] | Includes executive assurance, professional liability, workers’ compensation, excess motor, healthcare and other. | |||
[8] | Includes life, casualty clash and other. | |||
[9] | Other segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions. | |||
[10] | Includes proportional motor and other. | |||
[11] | Includes professional liability, excess motor, programs and other. | |||
[12] | Includes mortgage, US programs and other. |
Reserve for Losses and Loss A_3
Reserve for Losses and Loss Adjustment Expenses - Reconciliation of beginning and ending balances of losses and loss adjustment reserves (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract] | ||||
Reserve for losses and loss adjustment expenses at beginning of year | $ 16,513,929 | $ 13,891,842 | $ 11,853,297 | |
Unpaid losses and loss adjustment expenses recoverable | 4,314,855 | 4,082,650 | 2,814,291 | |
Net reserve for losses and loss adjustment expenses at beginning of year | 12,199,074 | 9,809,192 | 9,039,006 | |
Net incurred losses and loss adjustment expenses relating to losses occurring in: | ||||
Current year | 4,940,987 | 4,851,051 | 3,297,037 | |
Prior years | (356,184) | (161,452) | (163,585) | |
Total net incurred losses and loss adjustment expenses | 4,584,803 | 4,689,599 | 3,133,452 | |
Net losses and loss adjustment expense reserves of acquired business | [1] | 104,176 | 0 | 209,486 |
Retroactive reinsurance transaction | [2] | (444,147) | 182,210 | (225,500) |
Impact of deconsolidation of Somers | (1,460,611) | 0 | 0 | |
Foreign exchange (gains) losses and other | 1,181 | 179,190 | 36,003 | |
Net paid losses and loss adjustment expenses relating to losses occurring in: | ||||
Current year | (734,846) | (661,529) | (621,202) | |
Prior years | (2,091,705) | (1,999,588) | (1,762,053) | |
Total net paid losses and loss adjustment expenses | (2,826,551) | (2,661,117) | (2,383,255) | |
Net reserve for losses and loss adjustment expenses at end of year | 12,157,925 | 12,199,074 | 9,809,192 | |
Unpaid losses and loss adjustment expenses recoverable | 5,599,231 | 4,314,855 | 4,082,650 | |
Reserve for losses and loss adjustment expenses at end of year | $ 17,757,156 | $ 16,513,929 | $ 13,891,842 | |
[1] | Represents activity related to the Company’s acquisitions in the 2021 and the 2019 period. | |||
[2] | See ‘Retroactive Reinsurance Transactions’ section. |
Reserve for Losses and Loss A_4
Reserve for Losses and Loss Adjustment Expenses - Prior years reserve development (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 356,184 | $ 161,452 | $ 163,585 |
Operating segments | Insurance | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 16,200 | $ 7,800 | $ 15,800 |
Prior year reserve development (points) | 0.40% | 0.30% | 0.70% |
Operating segments | Insurance | Short-tailed lines | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 81,700 | $ 33,600 | $ 54,900 |
Operating segments | Insurance | Short-tailed lines | Property | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 38,900 | 21,600 | |
Operating segments | Insurance | Short-tailed lines | Lenders products | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 26,700 | ||
Operating segments | Insurance | Short-tailed lines | Travel, accident and health | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 16,200 | 8,400 | |
Operating segments | Insurance | Medium-tailed lines | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (93,500) | (75,200) | |
Operating segments | Insurance | Medium-tailed lines | Programs | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (16,000) | ||
Operating segments | Insurance | Medium-tailed lines | Professional liability | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (30,800) | ||
Operating segments | Insurance | Medium-tailed lines | Surety | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (37,900) | ||
Operating segments | Insurance | Medium-tailed lines | Contract binding | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (57,600) | (23,100) | |
Operating segments | Insurance | Long-tailed lines | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 28,100 | 49,400 | |
Operating segments | Insurance | Long-tailed lines | Other business | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 38,800 | ||
Operating segments | Insurance | Long-tailed lines | Construction and national accounts | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 9,300 | ||
Operating segments | Insurance | Medium-tailed and long-tailed lines | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (39,100) | ||
Operating segments | Insurance | Medium-tailed and long-tailed lines | Programs | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (30,100) | ||
Operating segments | Insurance | Medium-tailed and long-tailed lines | Professional liability | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 19,300 | ||
Operating segments | Insurance | Medium-tailed and long-tailed lines | Surety | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 15,800 | ||
Operating segments | Insurance | Medium-tailed and long-tailed lines | Contract binding | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (33,600) | ||
Operating segments | Insurance | Short Tailed And Long Tailed Lines | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 109,800 | 83,000 | |
Operating segments | Reinsurance | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 178,800 | $ 134,000 | $ 46,400 |
Prior year reserve development (points) | 6.30% | 6.20% | 3.20% |
Operating segments | Reinsurance | Short-tailed lines | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 175,500 | $ 144,000 | $ 70,500 |
Operating segments | Reinsurance | Short-tailed lines | Property catastrophe and property other than property catastrophe | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 87,700 | 33,700 | |
Operating segments | Reinsurance | Short-tailed lines | Property catastrophe | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (36,400) | ||
Operating segments | Reinsurance | Short-tailed lines | Property other than property catastrophe | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 88,600 | ||
Operating segments | Reinsurance | Short-tailed lines | Other specialty lines | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 123,300 | 53,600 | 40,800 |
Operating segments | Reinsurance | Medium-tailed lines | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 16,000 | ||
Operating segments | Reinsurance | Long-tailed lines | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (5,300) | (21,900) | (40,100) |
Operating segments | Reinsurance | Long-tailed lines | Casualty | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (44,500) | ||
Operating segments | Reinsurance | Short Tailed And Medium Tailed Lines | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 184,100 | 155,900 | |
Operating segments | Mortgage | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 169,600 | $ 19,000 | $ 125,200 |
Prior year reserve development (points) | 13.20% | 1.40% | 9.20% |
Operating segments | Mortgage | Primary mortgage business | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 16,200 | $ 117,100 | |
Operating segments | Other | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ (8,400) | $ 700 | $ (23,800) |
Short Duration Contracts - Clai
Short Duration Contracts - Claims development - Insurance (Details) $ in Thousands | Dec. 31, 2021USD ($)claims | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) |
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | $ 11,886,330 | |||||||||
Insurance | Property, energy, marine and aviation | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 1,947,000 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 1,377,632 | |||||||||
All outstanding liabilities before 2012, net of reinsurance | 17,517 | |||||||||
Insurance | Property, energy, marine and aviation | 2012 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 178,343 | $ 178,250 | $ 178,616 | $ 190,770 | $ 192,993 | $ 197,005 | $ 199,469 | $ 205,776 | $ 232,498 | $ 233,149 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 174,384 | 174,032 | 173,184 | 181,307 | 179,945 | 167,540 | 161,831 | 138,977 | 93,394 | 20,638 |
Total of IBNR liabilities plus expected development on reported claims | $ 627 | |||||||||
Cumulative number of reported claims | claims | 4,245 | |||||||||
Insurance | Property, energy, marine and aviation | 2013 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 126,276 | 127,290 | 128,624 | 133,869 | 134,952 | 143,400 | 149,199 | 156,785 | 159,102 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 124,841 | 124,688 | 123,356 | 125,475 | 122,244 | 120,111 | 110,808 | 84,936 | 32,292 | |
Total of IBNR liabilities plus expected development on reported claims | $ 25 | |||||||||
Cumulative number of reported claims | claims | 4,243 | |||||||||
Insurance | Property, energy, marine and aviation | 2014 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 134,942 | 135,032 | 134,329 | 132,307 | 136,201 | 147,465 | 145,957 | 148,368 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 122,296 | 115,383 | 98,553 | 87,812 | 84,195 | 77,892 | 53,751 | 25,881 | ||
Total of IBNR liabilities plus expected development on reported claims | $ 3,098 | |||||||||
Cumulative number of reported claims | claims | 3,884 | |||||||||
Insurance | Property, energy, marine and aviation | 2015 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 91,892 | 91,830 | 97,852 | 102,515 | 103,995 | 109,865 | 112,409 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 87,316 | 86,246 | 87,926 | 86,253 | 76,338 | 64,953 | 23,580 | |||
Total of IBNR liabilities plus expected development on reported claims | $ 3,804 | |||||||||
Cumulative number of reported claims | claims | 4,536 | |||||||||
Insurance | Property, energy, marine and aviation | 2016 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 92,553 | 96,437 | 100,471 | 105,657 | 101,306 | 104,449 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 91,241 | 95,002 | 97,506 | 98,683 | 83,552 | 24,828 | ||||
Total of IBNR liabilities plus expected development on reported claims | $ 874 | |||||||||
Cumulative number of reported claims | claims | 6,160 | |||||||||
Insurance | Property, energy, marine and aviation | 2017 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 231,228 | 230,439 | 235,951 | 246,291 | 280,715 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 215,895 | 211,708 | 195,532 | 139,867 | 30,228 | |||||
Total of IBNR liabilities plus expected development on reported claims | $ 8,248 | |||||||||
Cumulative number of reported claims | claims | 6,426 | |||||||||
Insurance | Property, energy, marine and aviation | 2018 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 170,057 | 173,693 | 186,030 | 180,981 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 142,838 | 134,858 | 102,285 | 30,026 | ||||||
Total of IBNR liabilities plus expected development on reported claims | $ 9,136 | |||||||||
Cumulative number of reported claims | claims | 5,020 | |||||||||
Insurance | Property, energy, marine and aviation | 2019 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 165,477 | 178,564 | 179,056 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 133,911 | 105,380 | 26,130 | |||||||
Total of IBNR liabilities plus expected development on reported claims | $ 6,667 | |||||||||
Cumulative number of reported claims | claims | 5,080 | |||||||||
Insurance | Property, energy, marine and aviation | 2020 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 329,362 | 359,394 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 194,487 | 55,619 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 66,698 | |||||||||
Cumulative number of reported claims | claims | 4,186 | |||||||||
Insurance | Property, energy, marine and aviation | 2021 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 426,870 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 90,423 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 158,163 | |||||||||
Cumulative number of reported claims | claims | 2,951 | |||||||||
Insurance | Third party occurrence business | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 4,187,063 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 1,544,247 | |||||||||
All outstanding liabilities before 2012, net of reinsurance | 242,741 | |||||||||
Insurance | Third party occurrence business | 2012 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 239,075 | 242,332 | 244,448 | 243,863 | 253,758 | 258,371 | 272,004 | 269,204 | 263,451 | 241,368 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 168,119 | 163,016 | 155,085 | 143,885 | 130,098 | 108,660 | 83,637 | 58,650 | 30,915 | 6,984 |
Total of IBNR liabilities plus expected development on reported claims | $ 43,924 | |||||||||
Cumulative number of reported claims | claims | 65,731 | |||||||||
Insurance | Third party occurrence business | 2013 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 270,558 | 269,754 | 272,849 | 274,717 | 282,122 | 302,165 | 307,152 | 297,225 | 283,228 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 184,800 | 174,946 | 164,403 | 149,292 | 122,288 | 101,293 | 71,449 | 29,265 | 6,857 | |
Total of IBNR liabilities plus expected development on reported claims | $ 54,640 | |||||||||
Cumulative number of reported claims | claims | 67,113 | |||||||||
Insurance | Third party occurrence business | 2014 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 343,569 | 342,934 | 344,197 | 339,701 | 343,113 | 338,890 | 336,019 | 330,015 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 224,101 | 211,643 | 191,305 | 162,123 | 112,702 | 71,624 | 40,346 | 9,228 | ||
Total of IBNR liabilities plus expected development on reported claims | $ 66,498 | |||||||||
Cumulative number of reported claims | claims | 75,904 | |||||||||
Insurance | Third party occurrence business | 2015 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 386,801 | 382,722 | 391,455 | 392,143 | 398,908 | 391,884 | 359,058 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 227,697 | 211,715 | 181,704 | 139,492 | 88,515 | 44,605 | 11,139 | |||
Total of IBNR liabilities plus expected development on reported claims | $ 91,081 | |||||||||
Cumulative number of reported claims | claims | 78,785 | |||||||||
Insurance | Third party occurrence business | 2016 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 367,818 | 374,896 | 399,571 | 406,082 | 394,485 | 389,832 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 194,773 | 164,662 | 136,870 | 87,616 | 41,979 | 11,709 | ||||
Total of IBNR liabilities plus expected development on reported claims | $ 115,303 | |||||||||
Cumulative number of reported claims | claims | 79,005 | |||||||||
Insurance | Third party occurrence business | 2017 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 407,115 | 412,512 | 422,624 | 417,941 | 417,377 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 165,606 | 135,111 | 99,874 | 52,356 | 13,408 | |||||
Total of IBNR liabilities plus expected development on reported claims | $ 145,130 | |||||||||
Cumulative number of reported claims | claims | 84,692 | |||||||||
Insurance | Third party occurrence business | 2018 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 451,459 | 450,937 | 453,190 | 430,415 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 154,248 | 115,137 | 63,848 | 17,025 | ||||||
Total of IBNR liabilities plus expected development on reported claims | $ 189,965 | |||||||||
Cumulative number of reported claims | claims | 77,700 | |||||||||
Insurance | Third party occurrence business | 2019 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 481,045 | 487,547 | 456,353 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 121,859 | 73,222 | 18,431 | |||||||
Total of IBNR liabilities plus expected development on reported claims | $ 253,849 | |||||||||
Cumulative number of reported claims | claims | 84,895 | |||||||||
Insurance | Third party occurrence business | 2020 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 616,910 | 607,249 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 76,743 | 24,509 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 428,750 | |||||||||
Cumulative number of reported claims | claims | 89,560 | |||||||||
Insurance | Third party occurrence business | 2021 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 622,713 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 26,301 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 543,386 | |||||||||
Cumulative number of reported claims | claims | 65,477 | |||||||||
Insurance | Third party claims-made business | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 3,353,974 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 1,804,720 | |||||||||
All outstanding liabilities before 2012, net of reinsurance | 64,171 | |||||||||
Insurance | Third party claims-made business | 2012 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 286,118 | 285,527 | 285,163 | 277,683 | 275,665 | 291,316 | 313,907 | 318,453 | 320,207 | 317,654 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 260,173 | 255,337 | 251,313 | 227,389 | 209,295 | 190,395 | 164,724 | 121,211 | 69,069 | 17,718 |
Total of IBNR liabilities plus expected development on reported claims | $ 11,570 | |||||||||
Cumulative number of reported claims | claims | 15,576 | |||||||||
Insurance | Third party claims-made business | 2013 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 273,948 | 271,501 | 281,996 | 291,205 | 294,674 | 320,524 | 324,442 | 320,659 | 301,956 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 247,078 | 245,687 | 238,951 | 217,132 | 198,008 | 179,395 | 137,963 | 87,458 | 19,032 | |
Total of IBNR liabilities plus expected development on reported claims | $ 11,739 | |||||||||
Cumulative number of reported claims | claims | 15,696 | |||||||||
Insurance | Third party claims-made business | 2014 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 288,318 | 292,247 | 298,017 | 282,058 | 279,043 | 299,104 | 279,846 | 264,537 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 249,960 | 243,791 | 229,958 | 208,074 | 173,089 | 129,712 | 63,312 | 13,817 | ||
Total of IBNR liabilities plus expected development on reported claims | $ 22,336 | |||||||||
Cumulative number of reported claims | claims | 15,676 | |||||||||
Insurance | Third party claims-made business | 2015 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 267,925 | 252,478 | 255,432 | 260,063 | 276,492 | 277,615 | 258,989 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 216,986 | 193,186 | 174,161 | 126,499 | 100,089 | 52,046 | 9,066 | |||
Total of IBNR liabilities plus expected development on reported claims | $ 20,617 | |||||||||
Cumulative number of reported claims | claims | 14,724 | |||||||||
Insurance | Third party claims-made business | 2016 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 327,230 | 322,042 | 314,747 | 308,453 | 291,645 | 275,394 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 242,431 | 205,596 | 158,230 | 127,286 | 68,226 | 10,568 | ||||
Total of IBNR liabilities plus expected development on reported claims | $ 42,509 | |||||||||
Cumulative number of reported claims | claims | 15,749 | |||||||||
Insurance | Third party claims-made business | 2017 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 323,854 | 308,917 | 312,554 | 286,565 | 271,088 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 196,125 | 143,340 | 113,208 | 67,669 | 9,306 | |||||
Total of IBNR liabilities plus expected development on reported claims | $ 60,718 | |||||||||
Cumulative number of reported claims | claims | 16,404 | |||||||||
Insurance | Third party claims-made business | 2018 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 337,083 | 320,653 | 315,085 | 273,521 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 158,709 | 118,361 | 68,424 | 12,287 | ||||||
Total of IBNR liabilities plus expected development on reported claims | $ 85,411 | |||||||||
Cumulative number of reported claims | claims | 15,854 | |||||||||
Insurance | Third party claims-made business | 2019 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 318,498 | 318,469 | 290,217 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 122,362 | 65,477 | 12,418 | |||||||
Total of IBNR liabilities plus expected development on reported claims | $ 119,673 | |||||||||
Cumulative number of reported claims | claims | 12,982 | |||||||||
Insurance | Third party claims-made business | 2020 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 414,580 | 384,852 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 87,547 | 17,161 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 240,888 | |||||||||
Cumulative number of reported claims | claims | 10,049 | |||||||||
Insurance | Third party claims-made business | 2021 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 516,420 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 23,349 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 435,910 | |||||||||
Cumulative number of reported claims | claims | 8,550 | |||||||||
Insurance | Multi-line and other specialty | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 4,479,691 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 3,376,225 | |||||||||
All outstanding liabilities before 2012, net of reinsurance | 22,375 | |||||||||
Insurance | Multi-line and other specialty | 2012 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 243,849 | 245,260 | 245,205 | 248,310 | 248,066 | 256,379 | 257,240 | 259,582 | 265,479 | 254,684 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 239,928 | 240,191 | 237,221 | 233,862 | 232,640 | 223,798 | 209,916 | 190,754 | 166,414 | $ 78,523 |
Total of IBNR liabilities plus expected development on reported claims | $ 2,057 | |||||||||
Cumulative number of reported claims | claims | 55,219 | |||||||||
Insurance | Multi-line and other specialty | 2013 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 246,682 | 247,443 | 250,252 | 254,916 | 253,554 | 265,672 | 265,594 | 274,285 | 266,089 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 239,831 | 238,792 | 237,863 | 235,801 | 226,769 | 214,941 | 181,721 | 151,897 | $ 86,911 | |
Total of IBNR liabilities plus expected development on reported claims | $ 3,461 | |||||||||
Cumulative number of reported claims | claims | 71,613 | |||||||||
Insurance | Multi-line and other specialty | 2014 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 310,097 | 311,097 | 314,300 | 318,297 | 319,418 | 319,706 | 327,098 | 303,053 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 295,551 | 294,049 | 292,638 | 282,104 | 267,959 | 235,079 | 197,609 | $ 108,003 | ||
Total of IBNR liabilities plus expected development on reported claims | $ 5,770 | |||||||||
Cumulative number of reported claims | claims | 109,575 | |||||||||
Insurance | Multi-line and other specialty | 2015 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 347,669 | 349,895 | 357,123 | 365,362 | 357,364 | 358,587 | 335,250 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 330,872 | 327,082 | 321,395 | 306,313 | 278,265 | 236,516 | $ 138,393 | |||
Total of IBNR liabilities plus expected development on reported claims | $ 7,201 | |||||||||
Cumulative number of reported claims | claims | 148,924 | |||||||||
Insurance | Multi-line and other specialty | 2016 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 408,621 | 410,610 | 416,724 | 428,579 | 431,760 | 409,367 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 385,890 | 379,885 | 363,392 | 342,345 | 305,250 | $ 176,238 | ||||
Total of IBNR liabilities plus expected development on reported claims | $ 11,032 | |||||||||
Cumulative number of reported claims | claims | 175,261 | |||||||||
Insurance | Multi-line and other specialty | 2017 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 505,135 | 501,753 | 492,166 | 502,068 | 483,414 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 446,749 | 424,219 | 381,419 | 343,049 | $ 181,454 | |||||
Total of IBNR liabilities plus expected development on reported claims | $ 16,867 | |||||||||
Cumulative number of reported claims | claims | 219,810 | |||||||||
Insurance | Multi-line and other specialty | 2018 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 566,283 | 563,969 | 565,717 | 513,466 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 480,852 | 443,644 | 390,009 | $ 212,316 | ||||||
Total of IBNR liabilities plus expected development on reported claims | $ 32,467 | |||||||||
Cumulative number of reported claims | claims | 247,052 | |||||||||
Insurance | Multi-line and other specialty | 2019 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 641,832 | 613,673 | 568,337 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 488,094 | 386,894 | $ 212,629 | |||||||
Total of IBNR liabilities plus expected development on reported claims | $ 63,880 | |||||||||
Cumulative number of reported claims | claims | 235,824 | |||||||||
Insurance | Multi-line and other specialty | 2020 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 572,265 | 622,241 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 311,112 | $ 173,123 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 192,056 | |||||||||
Cumulative number of reported claims | claims | 149,004 | |||||||||
Insurance | Multi-line and other specialty | 2021 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 637,258 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 157,346 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 361,237 | |||||||||
Cumulative number of reported claims | claims | 75,250 |
Short Duration Contracts - Cl_2
Short Duration Contracts - Claims development - Reinsurance (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Claims Development [Line Items] | ||||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | $ 11,886,330 | |||||||||
Reinsurance | Casualty | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 2,815,578 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 1,006,894 | |||||||||
All outstanding liabilities before 2012, net of reinsurance | 297,823 | |||||||||
Reinsurance | Casualty | 2012 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 119,222 | $ 120,260 | $ 121,721 | $ 118,457 | $ 109,788 | $ 115,131 | $ 125,104 | $ 137,049 | $ 141,202 | $ 143,029 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 79,364 | 75,833 | 69,877 | 59,511 | 47,807 | 36,562 | 25,523 | 14,690 | 8,486 | 1,306 |
Total of IBNR liabilities plus expected development on reported claims | 24,441 | |||||||||
Reinsurance | Casualty | 2013 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 135,959 | 135,762 | 131,475 | 135,155 | 136,717 | 148,784 | 155,066 | 159,257 | 166,016 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 81,856 | 76,703 | 70,803 | 63,136 | 54,567 | 43,069 | 23,044 | 9,930 | 2,480 | |
Total of IBNR liabilities plus expected development on reported claims | 30,873 | |||||||||
Reinsurance | Casualty | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 236,378 | 240,067 | 239,765 | 230,019 | 233,552 | 219,355 | 222,109 | 216,882 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 145,376 | 134,529 | 114,456 | 91,098 | 63,441 | 40,804 | 16,061 | 3,920 | ||
Total of IBNR liabilities plus expected development on reported claims | 41,077 | |||||||||
Reinsurance | Casualty | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 252,809 | 249,029 | 242,180 | 238,126 | 230,830 | 221,922 | 223,208 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 138,035 | 120,566 | 96,835 | 71,098 | 47,288 | 20,275 | 4,463 | |||
Total of IBNR liabilities plus expected development on reported claims | 57,345 | |||||||||
Reinsurance | Casualty | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 272,689 | 273,266 | 266,254 | 251,415 | 227,534 | 215,222 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 132,814 | 113,835 | 86,798 | 51,684 | 25,649 | 5,739 | ||||
Total of IBNR liabilities plus expected development on reported claims | 54,087 | |||||||||
Reinsurance | Casualty | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 313,605 | 301,616 | 273,166 | 257,088 | 270,728 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 137,921 | 113,307 | 64,075 | 30,360 | 6,429 | |||||
Total of IBNR liabilities plus expected development on reported claims | 66,450 | |||||||||
Reinsurance | Casualty | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 290,955 | 285,646 | 294,820 | 281,141 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 129,196 | 106,571 | 31,218 | 7,580 | ||||||
Total of IBNR liabilities plus expected development on reported claims | 66,572 | |||||||||
Reinsurance | Casualty | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 374,002 | 348,015 | 336,062 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 96,935 | 57,643 | 15,815 | |||||||
Total of IBNR liabilities plus expected development on reported claims | 120,045 | |||||||||
Reinsurance | Casualty | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 374,912 | 386,684 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 50,603 | 17,730 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | 234,251 | |||||||||
Reinsurance | Casualty | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 445,047 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 14,794 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | 392,885 | |||||||||
Reinsurance | Property catastrophe | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 880,759 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 396,960 | |||||||||
All outstanding liabilities before 2012, net of reinsurance | 2,449 | |||||||||
Reinsurance | Property catastrophe | 2012 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 96,447 | 96,531 | 97,145 | 97,037 | 99,071 | 99,885 | 102,114 | 108,590 | 122,942 | 149,957 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 95,606 | 95,414 | 95,312 | 94,625 | 94,015 | 92,886 | 90,727 | 83,822 | 70,832 | 25,850 |
Total of IBNR liabilities plus expected development on reported claims | 105 | |||||||||
Reinsurance | Property catastrophe | 2013 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 27,657 | 27,865 | 27,727 | 28,617 | 29,345 | 31,902 | 36,401 | 47,780 | 67,257 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 28,346 | 28,597 | 27,892 | 27,891 | 27,652 | 25,894 | 24,038 | 19,201 | 12,200 | |
Total of IBNR liabilities plus expected development on reported claims | (138) | |||||||||
Reinsurance | Property catastrophe | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 19,615 | 19,841 | 19,945 | 20,652 | 22,412 | 25,296 | 30,877 | 45,159 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 19,241 | 19,154 | 19,013 | 18,821 | 19,231 | 18,402 | 19,939 | 13,622 | ||
Total of IBNR liabilities plus expected development on reported claims | (10) | |||||||||
Reinsurance | Property catastrophe | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 2,920 | 3,130 | 3,775 | 5,585 | 11,580 | 18,075 | 33,579 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 1,781 | 1,705 | 1,616 | 2,050 | 1,786 | (2,518) | (3,152) | |||
Total of IBNR liabilities plus expected development on reported claims | 67 | |||||||||
Reinsurance | Property catastrophe | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 7,426 | 8,362 | 10,772 | 14,575 | 18,719 | 25,641 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 3,668 | 3,312 | 4,082 | 2,796 | 2,521 | (6,722) | ||||
Total of IBNR liabilities plus expected development on reported claims | 881 | |||||||||
Reinsurance | Property catastrophe | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 25,121 | 36,846 | 50,553 | 54,768 | 87,504 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 14,969 | 27,797 | 37,791 | 32,228 | 30,704 | |||||
Total of IBNR liabilities plus expected development on reported claims | (712) | |||||||||
Reinsurance | Property catastrophe | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 27,657 | 41,642 | 60,418 | 77,868 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | (4,612) | 24,259 | 12,506 | 27,497 | ||||||
Total of IBNR liabilities plus expected development on reported claims | 4,783 | |||||||||
Reinsurance | Property catastrophe | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 23,534 | 24,808 | 38,570 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 18,134 | 12,680 | 3,834 | |||||||
Total of IBNR liabilities plus expected development on reported claims | 4,576 | |||||||||
Reinsurance | Property catastrophe | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 334,185 | 267,750 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 155,063 | 53,275 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | 40,561 | |||||||||
Reinsurance | Property catastrophe | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 316,197 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 64,764 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | 61,821 | |||||||||
Reinsurance | Property excluding property catastrophe | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 2,081,611 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 1,365,172 | |||||||||
All outstanding liabilities before 2012, net of reinsurance | 7,595 | |||||||||
Reinsurance | Property excluding property catastrophe | 2012 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 103,367 | 102,994 | 108,436 | 111,001 | 112,477 | 114,699 | 119,124 | 123,689 | 121,808 | 156,162 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 102,525 | 102,504 | 102,598 | 102,658 | 103,480 | 102,844 | 101,868 | 93,198 | 78,080 | 26,153 |
Total of IBNR liabilities plus expected development on reported claims | 508 | |||||||||
Reinsurance | Property excluding property catastrophe | 2013 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 62,782 | 63,269 | 62,504 | 63,702 | 64,486 | 66,208 | 70,558 | 76,905 | 115,473 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 62,139 | 62,113 | 61,183 | 55,676 | 53,796 | 52,997 | 49,816 | 42,737 | 25,993 | |
Total of IBNR liabilities plus expected development on reported claims | 384 | |||||||||
Reinsurance | Property excluding property catastrophe | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 80,940 | 82,408 | 84,130 | 88,438 | 90,710 | 99,328 | 117,448 | 143,464 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 78,268 | 78,567 | 78,657 | 78,274 | 76,634 | 71,692 | 62,800 | 23,496 | ||
Total of IBNR liabilities plus expected development on reported claims | 923 | |||||||||
Reinsurance | Property excluding property catastrophe | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 173,659 | 177,281 | 188,343 | 189,045 | 184,774 | 189,109 | 215,095 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 159,925 | 159,675 | 166,025 | 160,848 | 149,814 | 119,237 | 75,622 | |||
Total of IBNR liabilities plus expected development on reported claims | 8,482 | |||||||||
Reinsurance | Property excluding property catastrophe | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 137,579 | 140,681 | 136,868 | 138,375 | 146,307 | 177,039 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 115,102 | 112,838 | 104,984 | 99,428 | 95,616 | 33,400 | ||||
Total of IBNR liabilities plus expected development on reported claims | 12,700 | |||||||||
Reinsurance | Property excluding property catastrophe | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 216,358 | 233,153 | 240,749 | 253,859 | 271,713 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 181,628 | 166,087 | 158,066 | 125,768 | 27,569 | |||||
Total of IBNR liabilities plus expected development on reported claims | 13,045 | |||||||||
Reinsurance | Property excluding property catastrophe | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 214,942 | 238,052 | 242,069 | 225,638 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 169,054 | 153,944 | 108,863 | 30,047 | ||||||
Total of IBNR liabilities plus expected development on reported claims | 11,593 | |||||||||
Reinsurance | Property excluding property catastrophe | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 196,840 | 206,997 | 216,653 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 150,931 | 124,222 | 43,230 | |||||||
Total of IBNR liabilities plus expected development on reported claims | 17,777 | |||||||||
Reinsurance | Property excluding property catastrophe | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 343,078 | 371,752 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 208,888 | 101,969 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | 51,075 | |||||||||
Reinsurance | Property excluding property catastrophe | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 552,066 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 136,712 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | 255,343 | |||||||||
Reinsurance | Marine and aviation | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 425,590 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 196,564 | |||||||||
All outstanding liabilities before 2012, net of reinsurance | 16,855 | |||||||||
Reinsurance | Marine and aviation | 2012 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 40,016 | 41,182 | 43,028 | 46,046 | 49,727 | 51,079 | 52,286 | 55,053 | 58,868 | 58,992 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 38,116 | 38,131 | 38,038 | 37,746 | 36,257 | 35,055 | 33,313 | 27,528 | 11,433 | 2,658 |
Total of IBNR liabilities plus expected development on reported claims | 1,005 | |||||||||
Reinsurance | Marine and aviation | 2013 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 27,605 | 30,316 | 33,970 | 34,415 | 35,157 | 35,251 | 36,653 | 37,668 | 38,881 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 23,753 | 23,786 | 24,049 | 23,672 | 22,398 | 21,388 | 18,415 | 13,731 | 4,945 | |
Total of IBNR liabilities plus expected development on reported claims | 2,394 | |||||||||
Reinsurance | Marine and aviation | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 21,984 | 22,031 | 23,310 | 23,677 | 25,674 | 27,373 | 29,159 | 30,958 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 16,036 | 15,956 | 15,080 | 14,645 | 12,469 | 11,590 | 7,985 | 4,177 | ||
Total of IBNR liabilities plus expected development on reported claims | 4,909 | |||||||||
Reinsurance | Marine and aviation | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 27,680 | 28,464 | 30,789 | 31,736 | 31,790 | 37,505 | 33,646 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 22,445 | 22,306 | 22,629 | 20,861 | 19,023 | 13,418 | 7 | |||
Total of IBNR liabilities plus expected development on reported claims | 3,867 | |||||||||
Reinsurance | Marine and aviation | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 15,019 | 16,969 | 19,273 | 23,567 | 22,747 | 27,351 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 6,767 | 5,864 | 3,261 | 521 | (1,687) | (7,333) | ||||
Total of IBNR liabilities plus expected development on reported claims | 6,708 | |||||||||
Reinsurance | Marine and aviation | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 19,903 | 20,827 | 23,830 | 26,346 | 28,800 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 11,632 | 11,030 | 9,367 | 6,541 | 1,660 | |||||
Total of IBNR liabilities plus expected development on reported claims | 6,387 | |||||||||
Reinsurance | Marine and aviation | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 24,756 | 24,615 | 26,084 | 28,017 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 13,585 | 11,236 | 6,968 | 2,005 | ||||||
Total of IBNR liabilities plus expected development on reported claims | 6,452 | |||||||||
Reinsurance | Marine and aviation | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 60,983 | 55,307 | 48,929 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 29,068 | 21,580 | 10,756 | |||||||
Total of IBNR liabilities plus expected development on reported claims | 15,112 | |||||||||
Reinsurance | Marine and aviation | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 76,598 | 83,457 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 26,519 | 9,220 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | 36,671 | |||||||||
Reinsurance | Marine and aviation | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 111,046 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 8,643 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | 89,459 | |||||||||
Reinsurance | Other specialty | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 2,946,010 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 1,971,982 | |||||||||
All outstanding liabilities before 2012, net of reinsurance | 7,777 | |||||||||
Reinsurance | Other specialty | 2012 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 179,364 | 181,246 | 189,193 | 194,726 | 196,539 | 193,882 | 196,138 | 202,046 | 211,839 | 222,558 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 173,494 | 173,606 | 173,305 | 171,519 | 167,164 | 163,160 | 155,445 | 144,429 | 121,679 | $ 45,663 |
Total of IBNR liabilities plus expected development on reported claims | 2,392 | |||||||||
Reinsurance | Other specialty | 2013 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 201,830 | 204,894 | 210,825 | 211,261 | 213,614 | 212,721 | 216,250 | 226,032 | 252,744 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 186,956 | 184,111 | 183,772 | 176,483 | 171,189 | 161,608 | 145,521 | 119,445 | $ 57,317 | |
Total of IBNR liabilities plus expected development on reported claims | 6,409 | |||||||||
Reinsurance | Other specialty | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 237,478 | 243,652 | 248,083 | 246,393 | 251,474 | 258,114 | 256,332 | 274,826 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 219,060 | 215,597 | 212,991 | 201,974 | 195,433 | 182,184 | 146,652 | $ 68,869 | ||
Total of IBNR liabilities plus expected development on reported claims | 7,857 | |||||||||
Reinsurance | Other specialty | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 182,162 | 193,626 | 196,840 | 196,521 | 199,468 | 201,057 | 209,764 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 164,471 | 162,314 | 154,369 | 145,419 | 138,350 | 114,382 | $ 54,359 | |||
Total of IBNR liabilities plus expected development on reported claims | 8,549 | |||||||||
Reinsurance | Other specialty | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 210,344 | 215,614 | 209,564 | 215,078 | 220,661 | 223,191 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 189,411 | 186,247 | 174,403 | 162,661 | 138,648 | $ 65,055 | ||||
Total of IBNR liabilities plus expected development on reported claims | 13,182 | |||||||||
Reinsurance | Other specialty | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 241,598 | 245,505 | 247,203 | 258,419 | 269,254 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 205,998 | 199,051 | 192,274 | 164,829 | $ 73,366 | |||||
Total of IBNR liabilities plus expected development on reported claims | 30,855 | |||||||||
Reinsurance | Other specialty | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 324,536 | 308,190 | 316,231 | 320,538 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 245,330 | 231,358 | 201,732 | $ 71,167 | ||||||
Total of IBNR liabilities plus expected development on reported claims | 40,807 | |||||||||
Reinsurance | Other specialty | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 326,168 | 341,409 | 360,854 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 216,647 | 158,132 | $ 79,718 | |||||||
Total of IBNR liabilities plus expected development on reported claims | 51,165 | |||||||||
Reinsurance | Other specialty | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 460,084 | 533,861 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 243,980 | $ 97,617 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | 102,130 | |||||||||
Reinsurance | Other specialty | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 582,446 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 126,635 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 300,667 |
Short Duration Contracts - Cl_3
Short Duration Contracts - Claims development - Mortgage (Details) $ in Thousands | Dec. 31, 2021USD ($)claims | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) |
Claims Development [Line Items] | ||||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | $ 11,886,330 | |||||||||
Mortgage | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 2,268,206 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 1,593,806 | |||||||||
All outstanding liabilities before 2012, net of reinsurance | 14,288 | |||||||||
Mortgage | 2012 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 456,362 | $ 456,331 | $ 456,286 | $ 458,065 | $ 459,467 | $ 467,296 | $ 469,238 | $ 475,317 | $ 480,592 | $ 520,835 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 453,986 | 453,587 | 452,348 | 448,151 | 441,577 | 426,024 | 395,695 | 327,605 | 186,605 | $ (106,065) |
Total of IBNR liabilities plus expected development on reported claims | $ 1 | |||||||||
Cumulative number of paid claims | claims | 15,080 | |||||||||
Mortgage | 2013 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 391,324 | 391,062 | 390,987 | 393,149 | 395,693 | 405,809 | 411,793 | 419,668 | 469,311 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 387,879 | 387,894 | 386,853 | 382,200 | 373,909 | 353,189 | 308,956 | 203,957 | $ 41,447 | |
Total of IBNR liabilities plus expected development on reported claims | $ 1 | |||||||||
Cumulative number of paid claims | claims | 9,468 | |||||||||
Mortgage | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 262,829 | 262,682 | 261,091 | 265,992 | 266,027 | 279,434 | 297,151 | 316,095 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 256,875 | 256,285 | 254,175 | 247,038 | 233,879 | 201,925 | 129,159 | $ 20,099 | ||
Total of IBNR liabilities plus expected development on reported claims | $ 4 | |||||||||
Cumulative number of paid claims | claims | 6,299 | |||||||||
Mortgage | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 190,560 | 190,913 | 189,235 | 194,677 | 198,001 | 197,238 | 222,790 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 184,025 | 183,472 | 180,321 | 171,337 | 151,222 | 92,431 | $ 16,159 | |||
Total of IBNR liabilities plus expected development on reported claims | $ 1 | |||||||||
Cumulative number of paid claims | claims | 4,554 | |||||||||
Mortgage | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 141,657 | 142,392 | 140,608 | 148,715 | 170,532 | 183,556 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 131,717 | 131,161 | 127,286 | 113,357 | 72,201 | $ 11,462 | ||||
Total of IBNR liabilities plus expected development on reported claims | $ 1 | |||||||||
Cumulative number of paid claims | claims | 3,424 | |||||||||
Mortgage | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 109,242 | 108,181 | 107,255 | 132,220 | 179,376 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 89,756 | 87,317 | 78,650 | 48,112 | $ 8,622 | |||||
Total of IBNR liabilities plus expected development on reported claims | $ 1 | |||||||||
Cumulative number of paid claims | claims | 2,474 | |||||||||
Mortgage | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 87,962 | 89,120 | 96,357 | 132,318 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 55,853 | 50,135 | 31,478 | $ 3,966 | ||||||
Total of IBNR liabilities plus expected development on reported claims | $ 60 | |||||||||
Cumulative number of paid claims | claims | 1,635 | |||||||||
Mortgage | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 110,362 | 119,253 | 108,424 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 29,102 | 20,105 | $ 2,899 | |||||||
Total of IBNR liabilities plus expected development on reported claims | $ 181 | |||||||||
Cumulative number of paid claims | claims | 851 | |||||||||
Mortgage | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 373,533 | 420,003 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 4,144 | $ 1,040 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 2,686 | |||||||||
Cumulative number of paid claims | claims | 189 | |||||||||
Mortgage | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 144,375 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 469 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 2,246 | |||||||||
Cumulative number of paid claims | claims | 11 |
Short Duration Contracts - Perc
Short Duration Contracts - Percentage annual payout - all segments (Details) | Dec. 31, 2021 |
Insurance | Property, energy, marine and aviation | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 19.30% |
Year Two | 43.50% |
Year Three | 19.10% |
Year Four | 6.60% |
Year Five | 1.40% |
Year Six | 2.30% |
Year Seven | 3.20% |
Year Eight | 0.50% |
Year Nine | 0.30% |
Year Ten | 0.20% |
Insurance | Third party occurrence business | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 3.30% |
Year Two | 9.30% |
Year Three | 11.60% |
Year Four | 11.00% |
Year Five | 9.80% |
Year Six | 8.70% |
Year Seven | 5.40% |
Year Eight | 4.10% |
Year Nine | 3.50% |
Year Ten | 2.10% |
Insurance | Third party claims-made business | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 4.40% |
Year Two | 18.00% |
Year Three | 17.80% |
Year Four | 12.30% |
Year Five | 12.70% |
Year Six | 7.90% |
Year Seven | 7.00% |
Year Eight | 4.30% |
Year Nine | 1.00% |
Year Ten | 1.70% |
Insurance | Multi-line and other specialty | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 34.70% |
Year Two | 29.50% |
Year Three | 11.00% |
Year Four | 8.60% |
Year Five | 4.60% |
Year Six | 2.80% |
Year Seven | 0.70% |
Year Eight | 0.70% |
Year Nine | 0.80% |
Year Ten | (0.10%) |
Reinsurance | Casualty | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 2.50% |
Year Two | 7.30% |
Year Three | 11.60% |
Year Four | 11.30% |
Year Five | 9.60% |
Year Six | 8.40% |
Year Seven | 7.70% |
Year Eight | 5.90% |
Year Nine | 4.40% |
Year Ten | 3.00% |
Reinsurance | Property catastrophe | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 21.60% |
Year Two | 30.00% |
Year Three | 32.80% |
Year Four | (14.20%) |
Year Five | (11.60%) |
Year Six | 2.20% |
Year Seven | 1.00% |
Year Eight | 1.20% |
Year Nine | (0.40%) |
Year Ten | 0.20% |
Reinsurance | Property catastrophe and property other than property catastrophe | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 26.70% |
Year Two | 38.90% |
Year Three | 13.30% |
Year Four | 5.80% |
Year Five | 3.40% |
Year Six | 0.40% |
Year Seven | 2.00% |
Year Eight | 0.40% |
Year Nine | 0.00% |
Year Ten | 0.00% |
Reinsurance | Marine and aviation | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 4.90% |
Year Two | 26.90% |
Year Three | 19.00% |
Year Four | 10.30% |
Year Five | 7.40% |
Year Six | 2.90% |
Year Seven | 2.40% |
Year Eight | 0.00% |
Year Nine | 0.10% |
Year Ten | 0.00% |
Reinsurance | Other specialty | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 26.30% |
Year Two | 34.20% |
Year Three | 12.90% |
Year Four | 5.20% |
Year Five | 4.20% |
Year Six | 3.10% |
Year Seven | 2.10% |
Year Eight | 0.90% |
Year Nine | 0.80% |
Year Ten | (0.10%) |
Mortgage | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 2.70% |
Year Two | 34.90% |
Year Three | 25.30% |
Year Four | 10.50% |
Year Five | 4.40% |
Year Six | 2.10% |
Year Seven | 0.90% |
Year Eight | 0.50% |
Year Nine | 0.10% |
Year Ten | 0.10% |
Short Duration Contracts - Reco
Short Duration Contracts - Reconciliation of claims development to liability (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | $ 11,886,330 | ||||
Unpaid losses and loss adjustment expenses recoverable | 5,599,231 | $ 4,314,855 | $ 4,082,650 | $ 2,814,291 | |
Lines other than short duration | 76,240 | ||||
Discounting | (55,575) | ||||
Unallocated claims adjustment expenses | 225,033 | ||||
Total reconciling items | 245,698 | ||||
Reserve for losses and loss adjustment expenses | 17,757,156 | $ 16,513,929 | $ 13,891,842 | $ 11,853,297 | |
Other short duration lines not included | Loss portfolio transfer | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Unpaid losses and loss adjustment expenses recoverable | [1] | 390,100 | |||
Total for short duration lines | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Unpaid losses and loss adjustment expenses recoverable | 5,625,128 | ||||
Operating segments | Other short duration lines not included | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 441,459 | ||||
Unpaid losses and loss adjustment expenses recoverable | [1] | 887,457 | |||
Operating segments | Insurance | Property, energy, marine and aviation | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 586,885 | ||||
Unpaid losses and loss adjustment expenses recoverable | 354,432 | ||||
Operating segments | Insurance | Third party occurrence business | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 2,885,557 | ||||
Unpaid losses and loss adjustment expenses recoverable | 1,537,549 | ||||
Operating segments | Insurance | Third party claims-made business | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 1,613,425 | ||||
Unpaid losses and loss adjustment expenses recoverable | 921,086 | ||||
Operating segments | Insurance | Multi-line and other specialty | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 1,125,841 | ||||
Unpaid losses and loss adjustment expenses recoverable | 199,485 | ||||
Operating segments | Reinsurance | Casualty | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 2,106,507 | ||||
Unpaid losses and loss adjustment expenses recoverable | 592,879 | ||||
Operating segments | Reinsurance | Property catastrophe | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 486,248 | ||||
Unpaid losses and loss adjustment expenses recoverable | 484,598 | ||||
Operating segments | Reinsurance | Property excluding property catastrophe | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 724,034 | ||||
Unpaid losses and loss adjustment expenses recoverable | 118,939 | ||||
Operating segments | Reinsurance | Marine and aviation | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 245,881 | ||||
Unpaid losses and loss adjustment expenses recoverable | 111,298 | ||||
Operating segments | Reinsurance | Other specialty | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 981,805 | ||||
Unpaid losses and loss adjustment expenses recoverable | 373,292 | ||||
Operating segments | Mortgage | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 688,688 | ||||
Unpaid losses and loss adjustment expenses recoverable | 48,259 | ||||
Consolidating adjustments and eliminations | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Unpaid losses and loss adjustment expenses recoverable | $ (4,146) | ||||
[1] | Includes unpaid loss and loss adjustment expenses recoverable of $390.1 million related to the loss portfolio transfer reinsurance agreements. |
Short Duration Contracts (Detai
Short Duration Contracts (Details) | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Mortgage | |
Claims Development [Line Items] | |
Large claim size threshold | $ 250,000 |
Allowance for Expected Credit_3
Allowance for Expected Credit Losses - Premiums receivable (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | ||
Credit Loss [Abstract] | |||
Balance at beginning of period | $ 2,064,586 | $ 1,778,717 | |
Balance at end of period | 2,633,280 | 2,064,586 | |
Allowance for Expected Credit Losses | |||
Balance at beginning of period | 37,781 | 21,003 | |
Cumulative effect of accounting change | [1] | 6,539 | |
Change for provision of expected credit losses | [2] | 2,177 | 10,239 |
Balance at end of period | 39,958 | 37,781 | |
Write-offs charged against the allowance | $ 3,800 | $ 2,800 | |
[1] | Adoption of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)” | ||
[2] | Amounts deemed uncollectible are written-off in operating expenses. For the 2021 and 2020 periods, amounts written off totaled $3.8 million and $2.8 million, respectively |
Allowance for Expected Credit_4
Allowance for Expected Credit Losses - Reinsurance recoverables (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | ||
Credit Loss [Abstract] | |||
Balance at beginning of period | $ 4,500,802 | $ 4,346,816 | |
Balance at end of period | 5,880,735 | 4,500,802 | |
Allowance for Expected Credit Losses | |||
Balance at beginning of period | 11,636 | 1,364 | |
Cumulative effect of accounting change | [1] | 12,010 | |
Change for provision of expected credit losses | 1,594 | (1,738) | |
Balance at end of period | $ 13,230 | $ 11,636 | |
[1] | Adoption of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)” |
Allowance for Expected Credit_5
Allowance for Expected Credit Losses - Ceded credit risk (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Concentration Risk [Line Items] | ||||
Reinsurance recoverable for paid and unpaid claims and claims adjustments | $ 5,880,735 | $ 4,500,802 | $ 4,346,816 | |
Shareholders' equity | Reinsurer concentration risk | Largest balance due from any one carrier | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | [1] | 6.70% | 1.80% | |
AM Best "A-" Or Better Rating | Reinsurance recoverable | Reinsurer concentration risk | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 69.70% | 63.90% | ||
Rating Below A- | Reinsurance recoverable | Reinsurer concentration risk | All Other Carriers | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 0.10% | 0.10% | ||
No AM Best rating | Reinsurance recoverable | Reinsurer concentration risk | All Other Carriers | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | [2] | 30.20% | 36.00% | |
No AM Best rating | Reinsurance recoverable | Reinsurer concentration risk | Reinsurance trusts or letters of credit | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 91.00% | 94.00% | ||
[1] | The 2021 period included impact of deconsolidation of Somers. | |||
[2] | At December 31, 2021 and 2020 period, over 91% and 94% of such amount is collateralized through reinsurance trusts, funds withheld arrangements, letters of credit or other, respectively |
Allowance for Expected Credit_6
Allowance for Expected Credit Losses - Contractholder receivables (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | ||
Credit Loss [Abstract] | |||
Balance at beginning of period | $ 1,986,924 | $ 2,119,460 | |
Balance at end of period | 1,828,691 | 1,986,924 | |
Allowance for Expected Credit Losses | |||
Balance at beginning of period | 8,638 | 0 | |
Cumulative effect of accounting change | [1] | 6,663 | |
Change for provision of expected credit losses | (5,201) | 1,975 | |
Balance at end of period | $ 3,437 | $ 8,638 | |
[1] | Adoption of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)” |
Reinsurance - Effects of reinsu
Reinsurance - Effects of reinsurance (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Premiums Written | |||
Direct | $ 7,706,832 | $ 6,553,910 | $ 5,681,523 |
Assumed | 5,045,655 | 3,534,158 | 2,457,437 |
Ceded | (3,734,150) | (2,650,352) | (2,099,893) |
Net premiums written | 9,018,337 | 7,437,716 | 6,039,067 |
Premiums Earned | |||
Direct | 7,149,794 | 6,361,451 | 5,447,829 |
Assumed | 4,333,873 | 3,213,873 | 2,337,950 |
Ceded | (3,401,369) | (2,583,389) | (1,999,281) |
Net premiums earned | 8,082,298 | 6,991,935 | 5,786,498 |
Losses and Loss Adjustment Expenses | |||
Direct | 4,266,758 | 4,392,392 | 2,953,072 |
Assumed | 2,826,820 | 2,204,323 | 1,602,528 |
Ceded | (2,508,775) | (1,907,116) | (1,422,148) |
Net | $ 4,584,803 | $ 4,689,599 | $ 3,133,452 |
Reinsurance - Coverage and rete
Reinsurance - Coverage and retention (Details) - Variable Interest Entity, Not Primary Beneficiary $ in Thousands | 12 Months Ended | |
Dec. 31, 2021USD ($) | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | $ 6,626,664 | |
Current Coverage | 4,649,174 | |
Remaining Retention, Net | $ 1,864,823 | |
Amortization period | 10 years | |
Bellemeade 2017-1 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | $ 368,114 | [1] |
Current Coverage | 108,368 | [1] |
Remaining Retention, Net | 125,926 | [1] |
Bellemeade 2018-1 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 374,460 | [2] |
Current Coverage | 181,136 | [2] |
Remaining Retention, Net | 122,118 | [2] |
Bellemeade 2018-3 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 506,110 | [3] |
Current Coverage | 302,563 | [3] |
Remaining Retention, Net | 128,020 | [3] |
Bellemeade 2019-1 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 341,790 | [4] |
Current Coverage | 181,324 | [4] |
Remaining Retention, Net | 97,845 | [4] |
Bellemeade 2019-2 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 621,022 | [5] |
Current Coverage | 398,316 | [5] |
Remaining Retention, Net | 156,419 | [5] |
Bellemeade 2019-3 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 700,920 | [6] |
Current Coverage | 409,859 | [6] |
Remaining Retention, Net | 181,583 | [6] |
Bellemeade 2019-4 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 577,267 | [7] |
Current Coverage | 411,954 | [7] |
Remaining Retention, Net | 116,292 | [7] |
Bellemeade 2020-2 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 449,167 | [8] |
Current Coverage | 218,877 | [8] |
Remaining Retention, Net | 222,567 | [8] |
Bellemeade 2020-2 Ltd | Funded By VIE | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 423,000 | |
Bellemeade 2020-2 Ltd | Directly provided capacity | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 26,000 | |
Bellemeade 2020-3 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 451,816 | [9] |
Current Coverage | 365,141 | [9] |
Remaining Retention, Net | 154,732 | [9] |
Bellemeade 2020-3 Ltd | Funded By VIE | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 418,000 | |
Bellemeade 2020-3 Ltd | Directly provided capacity | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 34,000 | |
Bellemeade 2020-4 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 337,013 | [10] |
Current Coverage | 186,065 | [10] |
Remaining Retention, Net | 129,824 | [10] |
Bellemeade 2020-4 Ltd | Funded By VIE | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 321,000 | |
Bellemeade 2020-4 Ltd | Directly provided capacity | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 16,000 | |
Bellemeade 2021-1 Ltd Member | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 643,577 | [11] |
Current Coverage | 630,163 | [11] |
Remaining Retention, Net | 149,189 | [11] |
Bellemeade 2021-1 Ltd Member | Funded By VIE | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 580,000 | |
Bellemeade 2021-1 Ltd Member | Directly provided capacity | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 64,000 | |
Bellemeade 2021-2 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 616,017 | [12] |
Current Coverage | 616,017 | [12] |
Remaining Retention, Net | 139,763 | [12] |
Bellemeade 2021-2 Ltd | Funded By VIE | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 523,000 | |
Bellemeade 2021-2 Ltd | Directly provided capacity | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 93,000 | |
Bellemeade 2021-3 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 639,391 | [13] |
Current Coverage | 639,391 | [13] |
Remaining Retention, Net | 140,545 | [13] |
Bellemeade 2021-3 Ltd | Funded By VIE | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 508,000 | |
Bellemeade 2021-3 Ltd | Directly provided capacity | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | $ 131,000 | |
[1] | Issued in October 2017, covering in-force policies issued between January 1, 2017 and June 30, 2017. | |
[2] | Issued in April 2018, covering in-force policies issued between July 1, 2017 and December 31, 2017. | |
[3] | Issued in October 2018, covering in-force policies issued between January 1, 2018 and June 30, 2018. | |
[4] | Issued in March 2019, covering in-force policies primarily issued between 2005 to 2008 under United Guaranty Residential Insurance Company (“UGRIC”); as well as policies issued through 2015 under both UGRIC and Arch Mortgage Insurance Company. | |
[5] | Issued in April 2019, covering in-force policies issued between July 1, 2018 and December 31, 2018. | |
[6] | Issued in July 2019, covering in-force policies issued in 2016. | |
[7] | Issued in October 2019, covering in-force policies issued between January 1, 2019 and June 30, 2019. | |
[8] | Issued in September 2020, covering in-force policies issued between January 1, 2020 and May 31, 2020. $423 million was directly funded by Bellemeade 2020-2 Ltd. with an additional $26 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers | |
[9] | Issued in November 2020, covering in-force policies issued between June 1, 2020 and August 31, 2020. $418 million was directly funded by Bellemeade 2020-3 Ltd. with an additional $34 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. | |
[10] | Issued in December 2020, covering in-force policies issued between July 1, 2019 and December 31, 2019. $321 million was directly funded by Bellemeade 2020-4 Ltd. with an additional $16 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers | |
[11] | Issued in March 2021, covering in-force policies issued between September 1, 2020 and November 30, 2020. $580 million was directly funded by Bellemeade Re 2021-1 Ltd. with an additional $64 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. | |
[12] | Issued in June 2021, covering in-force policies issued between December 1, 2020 and March 31, 2021. $523 million was directly funded by Bellemeade Re 2021-2 Ltd. via insurance-linked notes, with an additional $93 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers | |
[13] | Issued in September 2021, covering in-force policies issued between April 1, 2021 and June 30, 2021. $508 million was directly funded by Bellemeade Re 2021-3 Ltd. via insurance-linked notes, with an additional $131 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers |
Investment Information - Summar
Investment Information - Summary of available for sale securities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Available for sale securities: | ||||
Estimated fair value | $ 17,998,109 | $ 18,717,825 | ||
Gross Unrealized Gains | 198,691 | 657,620 | ||
Gross Unrealized Losses | (171,544) | (79,654) | ||
Allowance for Expected Credit Losses | (2,883) | (2,397) | ||
Cost or Amortized Cost | 17,973,823 | 18,143,305 | ||
Short-term investments | 1,734,716 | 1,924,922 | ||
Fair value of securities classified as available for sale | 19,732,825 | 20,921,530 | ||
Short-term investments available for sale, at amortized cost | 1,734,738 | 1,924,292 | ||
Cost or amortized cost of securities classified as available for sale | 19,708,561 | 20,345,961 | ||
Fixed maturities and fixed maturities pledged under securities lending agreements | ||||
Available for sale securities: | ||||
Estimated fair value | 17,998,109 | 18,996,608 | ||
Gross Unrealized Gains | 198,123 | 654,927 | ||
Gross Unrealized Losses | (170,954) | (77,591) | ||
Allowance for Expected Credit Losses | (2,883) | (2,397) | $ 0 | |
Cost or Amortized Cost | 17,973,823 | 18,421,669 | ||
Fixed maturities and fixed maturities pledged under securities lending agreements | Corporate bonds | ||||
Available for sale securities: | ||||
Estimated fair value | 6,553,333 | 7,856,571 | ||
Gross Unrealized Gains | 104,170 | 414,247 | [1] | |
Gross Unrealized Losses | (69,194) | (34,388) | [1] | |
Allowance for Expected Credit Losses | (2,037) | (896) | [1],[2] | |
Cost or Amortized Cost | 6,520,394 | 7,477,608 | ||
Fixed maturities and fixed maturities pledged under securities lending agreements | Mortgage backed securities | ||||
Available for sale securities: | ||||
Estimated fair value | 408,477 | 630,001 | ||
Gross Unrealized Gains | 2,825 | 8,939 | [1] | |
Gross Unrealized Losses | (5,410) | (5,028) | [1] | |
Allowance for Expected Credit Losses | (48) | (278) | [1],[2] | |
Cost or Amortized Cost | 411,110 | 626,368 | ||
Fixed maturities and fixed maturities pledged under securities lending agreements | Municipal bonds | ||||
Available for sale securities: | ||||
Estimated fair value | 404,666 | 494,522 | ||
Gross Unrealized Gains | 18,724 | 27,291 | [1] | |
Gross Unrealized Losses | (1,409) | (3,835) | [1] | |
Allowance for Expected Credit Losses | (2) | (11) | [1],[2] | $ 0 |
Cost or Amortized Cost | 387,353 | 471,077 | ||
Fixed maturities and fixed maturities pledged under securities lending agreements | Commercial mortgage backed securities | ||||
Available for sale securities: | ||||
Estimated fair value | 1,046,484 | 389,900 | ||
Gross Unrealized Gains | 1,740 | 8,722 | [1] | |
Gross Unrealized Losses | (3,117) | (2,954) | [1] | |
Allowance for Expected Credit Losses | (6) | (122) | [1],[2] | |
Cost or Amortized Cost | 1,047,867 | 384,254 | ||
Fixed maturities and fixed maturities pledged under securities lending agreements | US government and government agencies | ||||
Available for sale securities: | ||||
Estimated fair value | 4,772,764 | 5,557,077 | ||
Gross Unrealized Gains | 10,076 | 22,612 | [1] | |
Gross Unrealized Losses | (45,967) | (12,611) | [1] | |
Allowance for Expected Credit Losses | 0 | 0 | [1],[2] | |
Cost or Amortized Cost | 4,808,655 | 5,547,076 | ||
Fixed maturities and fixed maturities pledged under securities lending agreements | Non-US government securities | ||||
Available for sale securities: | ||||
Estimated fair value | 2,120,294 | 2,433,733 | ||
Gross Unrealized Gains | 54,048 | 153,891 | [1] | |
Gross Unrealized Losses | (34,749) | (8,060) | [1] | |
Allowance for Expected Credit Losses | (82) | 0 | [1],[2] | |
Cost or Amortized Cost | 2,101,077 | 2,287,902 | ||
Fixed maturities and fixed maturities pledged under securities lending agreements | Asset backed securities | ||||
Available for sale securities: | ||||
Estimated fair value | 2,692,091 | 1,634,804 | ||
Gross Unrealized Gains | 6,540 | 19,225 | [1] | |
Gross Unrealized Losses | (11,108) | (10,715) | [1] | |
Allowance for Expected Credit Losses | (708) | (1,090) | [1],[2] | |
Cost or Amortized Cost | 2,697,367 | 1,627,384 | ||
Short-term investments | ||||
Available for sale securities: | ||||
Gross Unrealized Gains | 568 | 2,693 | ||
Gross Unrealized Losses | (590) | (2,063) | ||
Allowance for Expected Credit Losses | 0 | 0 | ||
Short-term investments | 1,734,716 | 1,924,922 | ||
Short-term investments available for sale, at amortized cost | $ 1,734,738 | $ 1,924,292 | ||
[1] | In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities pledged. For purposes of this table, the Company has excluded the collateral received under securities lending, at fair value and included the securities pledged under securities lending, at fair value. See “—Securities Lending Agreements.” In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions. | |||
[2] | Effective January 1, 2020, the Company adopted ASU 2016-13 and as a result any credit impairment losses on the Company’s available-for-sale investments are recorded as an allowance, subject to reversal. |
Investment Information - Aging
Investment Information - Aging of available for sale securities in an unrealized loss position (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | |
Available for sale securities: | |||
Estimated Fair Value - Less than 12 Months | $ 12,238,683 | $ 3,788,763 | |
Gross Unrealized Losses - Less than 12 Months | (157,279) | (76,067) | |
Estimated Fair Value - 12 Months or More | 297,357 | 70,404 | |
Gross Unrealized Losses - 12 Months or More | (14,265) | (3,587) | |
Estimated Fair Value - Total | 12,536,040 | 3,859,167 | |
Gross Unrealized Losses - Total | (171,544) | (79,654) | |
Fixed maturities and fixed maturities pledged under securities lending agreements | |||
Available for sale securities: | |||
Estimated Fair Value - Less than 12 Months | 11,953,950 | 3,690,843 | |
Gross Unrealized Losses - Less than 12 Months | (156,689) | (74,004) | |
Estimated Fair Value - 12 Months or More | 297,357 | 70,404 | |
Gross Unrealized Losses - 12 Months or More | (14,265) | (3,587) | |
Estimated Fair Value - Total | 12,251,307 | 3,761,247 | |
Gross Unrealized Losses - Total | (170,954) | (77,591) | |
Fixed maturities and fixed maturities pledged under securities lending agreements | Corporate bonds | |||
Available for sale securities: | |||
Estimated Fair Value - Less than 12 Months | 3,639,582 | 747,442 | [1] |
Gross Unrealized Losses - Less than 12 Months | (63,938) | (33,086) | [1] |
Estimated Fair Value - 12 Months or More | 98,867 | 3,934 | [1] |
Gross Unrealized Losses - 12 Months or More | (5,256) | (1,302) | [1] |
Estimated Fair Value - Total | 3,738,449 | 751,376 | [1] |
Gross Unrealized Losses - Total | (69,194) | (34,388) | [1] |
Fixed maturities and fixed maturities pledged under securities lending agreements | Mortgage backed securities | |||
Available for sale securities: | |||
Estimated Fair Value - Less than 12 Months | 222,176 | 284,619 | [1] |
Gross Unrealized Losses - Less than 12 Months | (3,545) | (4,788) | [1] |
Estimated Fair Value - 12 Months or More | 46,809 | 3,637 | [1] |
Gross Unrealized Losses - 12 Months or More | (1,865) | (240) | [1] |
Estimated Fair Value - Total | 268,985 | 288,256 | [1] |
Gross Unrealized Losses - Total | (5,410) | (5,028) | [1] |
Fixed maturities and fixed maturities pledged under securities lending agreements | Municipal bonds | |||
Available for sale securities: | |||
Estimated Fair Value - Less than 12 Months | 26,665 | 67,937 | [1] |
Gross Unrealized Losses - Less than 12 Months | (385) | (3,835) | [1] |
Estimated Fair Value - 12 Months or More | 16,361 | 0 | [1] |
Gross Unrealized Losses - 12 Months or More | (1,024) | 0 | [1] |
Estimated Fair Value - Total | 43,026 | 67,937 | [1] |
Gross Unrealized Losses - Total | (1,409) | (3,835) | [1] |
Fixed maturities and fixed maturities pledged under securities lending agreements | Commercial mortgage backed securities | |||
Available for sale securities: | |||
Estimated Fair Value - Less than 12 Months | 675,603 | 126,624 | [1] |
Gross Unrealized Losses - Less than 12 Months | (2,805) | (2,916) | [1] |
Estimated Fair Value - 12 Months or More | 5,908 | 2,655 | [1] |
Gross Unrealized Losses - 12 Months or More | (312) | (38) | [1] |
Estimated Fair Value - Total | 681,511 | 129,279 | [1] |
Gross Unrealized Losses - Total | (3,117) | (2,954) | [1] |
Fixed maturities and fixed maturities pledged under securities lending agreements | US government and government agencies | |||
Available for sale securities: | |||
Estimated Fair Value - Less than 12 Months | 4,211,621 | 1,285,907 | [1] |
Gross Unrealized Losses - Less than 12 Months | (44,180) | (12,611) | [1] |
Estimated Fair Value - 12 Months or More | 33,373 | 0 | [1] |
Gross Unrealized Losses - 12 Months or More | (1,787) | 0 | [1] |
Estimated Fair Value - Total | 4,244,994 | 1,285,907 | [1] |
Gross Unrealized Losses - Total | (45,967) | (12,611) | [1] |
Fixed maturities and fixed maturities pledged under securities lending agreements | Non-US government securities | |||
Available for sale securities: | |||
Estimated Fair Value - Less than 12 Months | 1,511,301 | 543,844 | [1] |
Gross Unrealized Losses - Less than 12 Months | (31,983) | (7,658) | [1] |
Estimated Fair Value - 12 Months or More | 62,957 | 2,441 | [1] |
Gross Unrealized Losses - 12 Months or More | (2,766) | (402) | [1] |
Estimated Fair Value - Total | 1,574,258 | 546,285 | [1] |
Gross Unrealized Losses - Total | (34,749) | (8,060) | [1] |
Fixed maturities and fixed maturities pledged under securities lending agreements | Asset backed securities | |||
Available for sale securities: | |||
Estimated Fair Value - Less than 12 Months | 1,667,002 | 634,470 | [1] |
Gross Unrealized Losses - Less than 12 Months | (9,853) | (9,110) | [1] |
Estimated Fair Value - 12 Months or More | 33,082 | 57,737 | [1] |
Gross Unrealized Losses - 12 Months or More | (1,255) | (1,605) | [1] |
Estimated Fair Value - Total | 1,700,084 | 692,207 | [1] |
Gross Unrealized Losses - Total | (11,108) | (10,715) | [1] |
Short-term investments | |||
Available for sale securities: | |||
Estimated Fair Value - Less than 12 Months | 284,733 | 97,920 | |
Gross Unrealized Losses - Less than 12 Months | (590) | (2,063) | |
Estimated Fair Value - 12 Months or More | 0 | 0 | |
Gross Unrealized Losses - 12 Months or More | 0 | 0 | |
Estimated Fair Value - Total | 284,733 | 97,920 | |
Gross Unrealized Losses - Total | $ (590) | $ (2,063) | |
[1] | In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities pledged. For purposes of this table, the Company has excluded the collateral received under securities lending, at fair value and included the securities pledged under securities lending, at fair value. See “—Securities Lending Agreements.” In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions. |
Investment Information - Maturi
Investment Information - Maturity profile of available for sale securities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | |
Estimated Fair Value: | |||
Estimated fair value | $ 17,998,109 | $ 18,717,825 | |
Amortized Cost: | |||
Amortized cost | 17,973,823 | 18,143,305 | |
Fixed maturities and fixed maturities pledged under securities lending agreements | |||
Estimated Fair Value: | |||
Due in one year or less | 300,889 | 348,200 | [1] |
Due after one year through five years | 8,355,255 | 10,629,959 | [1] |
Due after five years through 10 years | 4,689,155 | 4,881,564 | [1] |
Due after 10 years | 505,758 | 482,180 | [1] |
Single maturity date | 13,851,057 | 16,341,903 | [1] |
Estimated fair value | 17,998,109 | 18,996,608 | |
Amortized Cost: | |||
Due in one year or less | 299,772 | 339,951 | [1] |
Due after one year through five years | 8,339,387 | 10,340,819 | [1] |
Due after five years through 10 years | 4,684,393 | 4,654,754 | [1] |
Due after 10 years | 493,927 | 448,139 | [1] |
Single maturity date | 13,817,479 | 15,783,663 | [1] |
Amortized cost | 17,973,823 | 18,421,669 | |
Fixed maturities and fixed maturities pledged under securities lending agreements | Mortgage backed securities | |||
Estimated Fair Value: | |||
Securities without single maturity date | 408,477 | 630,001 | [1] |
Estimated fair value | 408,477 | 630,001 | |
Amortized Cost: | |||
Securities without single maturity date | 411,110 | 626,368 | [1] |
Amortized cost | 411,110 | 626,368 | |
Fixed maturities and fixed maturities pledged under securities lending agreements | Commercial mortgage backed securities | |||
Estimated Fair Value: | |||
Securities without single maturity date | 1,046,484 | 389,900 | [1] |
Estimated fair value | 1,046,484 | 389,900 | |
Amortized Cost: | |||
Securities without single maturity date | 1,047,867 | 384,254 | [1] |
Amortized cost | 1,047,867 | 384,254 | |
Fixed maturities and fixed maturities pledged under securities lending agreements | Asset backed securities | |||
Estimated Fair Value: | |||
Securities without single maturity date | 2,692,091 | 1,634,804 | [1] |
Estimated fair value | 2,692,091 | 1,634,804 | |
Amortized Cost: | |||
Securities without single maturity date | 2,697,367 | 1,627,384 | [1] |
Amortized cost | $ 2,697,367 | $ 1,627,384 | |
[1] | In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities pledged. For purposes of this table, the Company has excluded the collateral received under securities lending, at fair value and included the securities pledged under securities lending, at fair value. See “—Securities Lending Agreements.” In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions. |
Investment Information - Securi
Investment Information - Securities lending arrangements (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | $ 0 | $ 301,089,000 |
Gross amount of recognized liabilities for securities lending in offsetting disclosure in Note 11 | 0 | |
Amounts related to securities lending not included in offsetting disclosure in Note 11 | 301,089,000 | |
Collateral received under securities lending, at fair value | 0 | 301,096,000 |
Cash and Cash Equivalents | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Collateral received under securities lending, at fair value | 0 | 0 |
Equity securities | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Collateral received under securities lending, at fair value | $ 0 | 301,100,000 |
US government and government agencies | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 281,607,000 | |
Corporate bonds | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 3,021,000 | |
Equity securities | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 16,461,000 | |
Overnight and Continuous | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 161,799,000 | |
Overnight and Continuous | US government and government agencies | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 142,317,000 | |
Overnight and Continuous | Corporate bonds | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 3,021,000 | |
Overnight and Continuous | Equity securities | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 16,461,000 | |
Less than 30 Days | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 0 | |
Less than 30 Days | US government and government agencies | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 0 | |
Less than 30 Days | Corporate bonds | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 0 | |
Less than 30 Days | Equity securities | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 0 | |
30-90 Days | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 139,290,000 | |
30-90 Days | US government and government agencies | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 139,290,000 | |
30-90 Days | Corporate bonds | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 0 | |
30-90 Days | Equity securities | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 0 | |
90 Days or More | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 0 | |
90 Days or More | US government and government agencies | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 0 | |
90 Days or More | Corporate bonds | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | 0 | |
90 Days or More | Equity securities | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Securities lending payable | $ 0 |
Investment Information - Net in
Investment Information - Net investment Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Net investment income: | ||||
Gross investment income | $ 477,123 | $ 608,823 | $ 716,643 | |
Investment expenses | (88,005) | (89,215) | (88,905) | |
Net investment income | 389,118 | 519,608 | 627,738 | |
Fixed maturities | ||||
Net investment income: | ||||
Gross investment income | 330,061 | 412,481 | 505,399 | |
Term loan investments | ||||
Net investment income: | ||||
Gross investment income | 34,843 | 84,149 | 98,949 | |
Equity securities | ||||
Net investment income: | ||||
Gross investment income | 42,396 | 28,958 | 15,857 | |
Short-term investments | ||||
Net investment income: | ||||
Gross investment income | 6,928 | 10,840 | 15,820 | |
Other | ||||
Net investment income: | ||||
Gross investment income | [1] | $ 62,895 | $ 72,395 | $ 80,618 |
[1] | Includes income distributions from investment funds and other items |
Investment Information - Net re
Investment Information - Net realized gains and losses (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Net realized gains and losses: | ||||
Available for sale securities, gross gains on investment sales | $ 313,886 | $ 595,941 | $ 235,655 | |
Available for sale securities, gross losses on investment sales | (156,791) | (117,282) | (104,612) | |
Equity securities at fair value, net realized gains (losses) on sales during the period | 122,606 | 26,849 | 11,313 | |
Equity securities at fair value, net unrealized gains (losses) on equity securities still held at reporting date | 48,746 | 102,394 | 97,768 | |
Allowance for credit losses - investment related | (2,100) | (3,597) | 0 | |
Allowance for credit losses - underwriting related | 1,062 | (10,007) | 0 | |
Net impairment losses | 0 | 533 | ||
Net impairment losses | (3,165) | |||
Derivative instruments | (32,390) | 179,675 | 119,741 | |
Other | [1] | (53,537) | 3,575 | (19,348) |
Net realized gains (losses) | 379,845 | 823,460 | 363,198 | |
Greysbridge Holdings Ltd | ||||
Net realized gains and losses: | ||||
Gain (loss) on deconsolidation | (33,100) | |||
Fixed maturities | ||||
Net realized gains and losses: | ||||
Change in fair value of assets and liabilities accounted for using the fair value option | 7,953 | 15,881 | 41,910 | |
Other investments | ||||
Net realized gains and losses: | ||||
Change in fair value of assets and liabilities accounted for using the fair value option | 116,781 | 13,656 | (35,734) | |
Equity securities | ||||
Net realized gains and losses: | ||||
Change in fair value of assets and liabilities accounted for using the fair value option | 13,028 | 14,629 | 15,869 | |
Short-term investments | ||||
Net realized gains and losses: | ||||
Change in fair value of assets and liabilities accounted for using the fair value option | $ 601 | $ 2,279 | $ 3,801 | |
[1] | 2021 periods reflected $33.1 million of losses related to the Company’sdeconsolidation of Somers |
Investment Information - Other
Investment Information - Other investments and other investable assets (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | |
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Investments accounted for using the fair value option | $ 1,973,550 | $ 3,824,796 | |
Other investable assets | [1] | 0 | 500,000 |
Total other investments | 1,973,550 | 4,324,796 | |
Fixed maturities | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Investments accounted for using the fair value option | 416,698 | 843,354 | |
Other investments | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Investments accounted for using the fair value option | 1,432,553 | 2,331,885 | |
Short-term investments | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Investments accounted for using the fair value option | 97,806 | 557,008 | |
Equity securities | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Investments accounted for using the fair value option | $ 26,493 | $ 92,549 | |
[1] | Participation interests in a receivable of a reverse repurchase agreement. |
Investment Information - Othe_2
Investment Information - Other investments by strategy (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Schedule Of Other Investments [Line Items] | ||
Investments accounted for using the fair value option | $ 1,973,550 | $ 3,824,796 |
Other investments | ||
Schedule Of Other Investments [Line Items] | ||
Investments accounted for using the fair value option | 1,432,553 | 2,331,885 |
Other investments | Lending | ||
Schedule Of Other Investments [Line Items] | ||
Investments accounted for using the fair value option | 536,345 | 572,636 |
Other investments | Term loan investments | ||
Schedule Of Other Investments [Line Items] | ||
Investments accounted for using the fair value option | 484,950 | 1,231,731 |
Other investments | Investment grade fixed income | ||
Schedule Of Other Investments [Line Items] | ||
Investments accounted for using the fair value option | 147,810 | 138,646 |
Other investments | Private equity | ||
Schedule Of Other Investments [Line Items] | ||
Investments accounted for using the fair value option | 91,126 | 48,750 |
Other investments | Energy | ||
Schedule Of Other Investments [Line Items] | ||
Investments accounted for using the fair value option | 81,692 | 65,813 |
Other investments | Credit related funds | ||
Schedule Of Other Investments [Line Items] | ||
Investments accounted for using the fair value option | 70,278 | 90,780 |
Other investments | Infrastructure | ||
Schedule Of Other Investments [Line Items] | ||
Investments accounted for using the fair value option | 20,352 | 165,516 |
Other investments | Real estate | ||
Schedule Of Other Investments [Line Items] | ||
Investments accounted for using the fair value option | $ 0 | $ 18,013 |
Investment Information - Equity
Investment Information - Equity method investments and investments in affiliates (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Balance sheet: | |||
Total assets | $ 45,100,945 | $ 43,282,297 | $ 37,885,361 |
Total liabilities | 31,545,816 | 29,294,856 | 25,569,809 |
Income statement: | |||
Total revenues | 9,249,980 | 8,508,509 | 6,925,967 |
Net income | 2,239,462 | 1,465,711 | 1,693,300 |
Investments accounted for using the equity method | 3,077,611 | 2,047,889 | |
Equity in net income (loss) of investment funds accounted for using the equity method | 366,402 | 146,693 | 123,672 |
Credit related funds | |||
Income statement: | |||
Investments accounted for using the equity method | 1,022,334 | 740,060 | |
Private equity | |||
Income statement: | |||
Investments accounted for using the equity method | 436,042 | 235,289 | |
Real estate | |||
Income statement: | |||
Investments accounted for using the equity method | 396,395 | 258,518 | |
Equity Funds | |||
Income statement: | |||
Investments accounted for using the equity method | 395,090 | 343,058 | |
Lending | |||
Income statement: | |||
Investments accounted for using the equity method | 376,649 | 179,629 | |
Infrastructure | |||
Income statement: | |||
Investments accounted for using the equity method | 230,070 | 175,882 | |
Energy | |||
Income statement: | |||
Investments accounted for using the equity method | 119,141 | 115,453 | |
Fixed income | |||
Income statement: | |||
Investments accounted for using the equity method | 101,890 | 0 | |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | |||
Balance sheet: | |||
Invested assets | 58,508,009 | 44,131,377 | |
Total assets | 69,648,905 | 49,078,464 | |
Total liabilities | 17,944,325 | 6,054,189 | |
Net assets | 51,704,580 | 43,024,275 | |
Income statement: | |||
Total revenues | 11,785,949 | 5,762,098 | 164,669 |
Total expenses | 3,238,606 | 1,656,029 | 528,762 |
Net income | $ 8,547,343 | $ 4,106,069 | $ (364,093) |
Investment Information - Limite
Investment Information - Limited partnership interests (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | |
Schedule of Equity Method Investments [Line Items] | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | $ 3,248,206 | $ 2,232,609 | |
Aggregate commitments | 3,000,000 | 2,100,000 | |
Equity method investments | |||
Schedule of Equity Method Investments [Line Items] | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | [1] | 3,077,611 | 2,047,889 |
Aggregate commitments | 2,600,000 | 1,800,000 | |
Fair value option | |||
Schedule of Equity Method Investments [Line Items] | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | [2] | 170,595 | 184,720 |
Aggregate commitments | $ 18,800 | $ 35,600 | |
[1] | Aggregate unfunded commitments were $2.6 billion at December 31, 2021, compared to $1.8 billion at December 31, 2020. | ||
[2] | Aggregate unfunded commitments were $18.8 million at December 31, 2021, compared to $35.6 million at December 31, 2020. |
Investment Information - Operat
Investment Information - Operating affiliates (Details) € / shares in Units, $ / shares in Units, $ in Thousands, € in Millions | 12 Months Ended | |||||
Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2021EUR (€)€ / shares | Dec. 30, 2021 | Jul. 01, 2021$ / shares | |
Schedule of Equity Method Investments [Line Items] | ||||||
Investment in operating affiliates | $ 1,135,655 | $ 129,291 | ||||
Income (loss) from operating affiliates | $ 264,693 | $ 16,766 | $ 2,233 | |||
Greysbridge Holdings Ltd | Kelso And Company | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Percentage ownership | 30.00% | |||||
Greysbridge Holdings Ltd | Warburg Pincus | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Percentage ownership | 30.00% | |||||
Coface | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Percentage ownership | 29.86% | 29.86% | 29.50% | |||
Investment in affiliate, price per share | € / shares | € 9.95 | |||||
Equity method investment, aggregate cost | $ 546,000 | € 453 | ||||
Operating affiliate gain on acquisition | 74,500 | |||||
Operating affiliates , deferred gain on acquisition | $ 36,000 | |||||
Operating affiliates, deferred gain on acquisition, amortization period | 5 years | |||||
Investment in operating affiliates | $ 630,500 | |||||
Coface | Issued Shares Excluding Treasury Stock | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Percentage ownership | 30.10% | 30.10% | ||||
Greysbridge Holdings Ltd | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Percentage ownership | 40.00% | |||||
Investment in affiliate, price per share | $ / shares | $ 35 | |||||
Equity method investment, aggregate cost | $ 278,900 | |||||
Operating affiliate gain on acquisition | 95,700 | |||||
Investment in operating affiliates | 375,700 | |||||
Gain (loss) on deconsolidation | $ (33,100) |
Investment Information - Allowa
Investment Information - Allowance for expected credit losses (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Line Items] | ||||||
Balance at beginning of period | $ 2,397 | |||||
Additions for current-period provision for expected credit losses | 2,100 | $ 3,597 | $ 0 | |||
Balance at end of period | 2,883 | 2,397 | ||||
Fixed maturities | ||||||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Line Items] | ||||||
Balance at beginning of period | 2,397 | 0 | ||||
Cumulative effect of accounting change | [1] | 634 | ||||
Additions for current-period provision for expected credit losses | 3,460 | 10,653 | ||||
Additions (reductions) for previously recognized expected credit losses | (1,176) | (7,030) | ||||
Reductions due to disposals | (1,798) | [2] | (1,860) | |||
Balance at end of period | 2,883 | 2,397 | 0 | |||
Fixed maturities | Structured securities | ||||||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Line Items] | ||||||
Balance at beginning of period | [3] | 1,490 | 0 | |||
Cumulative effect of accounting change | [1],[3] | 517 | ||||
Additions for current-period provision for expected credit losses | [3] | 602 | 2,942 | |||
Additions (reductions) for previously recognized expected credit losses | [3] | (847) | (1,398) | |||
Reductions due to disposals | [3] | (443) | [2] | (571) | ||
Balance at end of period | [3] | 802 | 1,490 | 0 | ||
Fixed maturities | Municipal bonds | ||||||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Line Items] | ||||||
Balance at beginning of period | 11 | [4],[5] | 0 | |||
Cumulative effect of accounting change | [1] | 0 | ||||
Additions for current-period provision for expected credit losses | 0 | 67 | ||||
Additions (reductions) for previously recognized expected credit losses | (9) | 6 | ||||
Reductions due to disposals | 0 | [2] | (62) | |||
Balance at end of period | 2 | 11 | [4],[5] | 0 | ||
Fixed maturities | Corporate bonds | ||||||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Line Items] | ||||||
Balance at beginning of period | 896 | 0 | ||||
Cumulative effect of accounting change | [1] | 117 | ||||
Additions for current-period provision for expected credit losses | 2,858 | 7,644 | ||||
Additions (reductions) for previously recognized expected credit losses | (320) | (5,638) | ||||
Reductions due to disposals | (1,355) | [2] | (1,227) | |||
Balance at end of period | $ 2,079 | $ 896 | $ 0 | |||
[1] | Adoption of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)” | |||||
[2] | Reduction for the 2021 periods primarily related to the Company’s deconsolidation of Somers. | |||||
[3] | Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities. | |||||
[4] | Effective January 1, 2020, the Company adopted ASU 2016-13 and as a result any credit impairment losses on the Company’s available-for-sale investments are recorded as an allowance, subject to reversal. | |||||
[5] | In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities pledged. For purposes of this table, the Company has excluded the collateral received under securities lending, at fair value and included the securities pledged under securities lending, at fair value. See “—Securities Lending Agreements.” In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions. |
Investment Information - Restri
Investment Information - Restricted assets (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | |
Restricted Assets [Line Items] | |||
Restricted assets | $ 8,249,732 | $ 8,733,309 | [1] |
Collateral or guarantees - affiliated transactions | |||
Restricted Assets [Line Items] | |||
Restricted assets | 4,223,955 | 4,643,334 | |
Collateral or guarantees - third party agreements | |||
Restricted Assets [Line Items] | |||
Restricted assets | 2,721,160 | 3,083,324 | |
Deposits with US regulatory authorities | |||
Restricted Assets [Line Items] | |||
Restricted assets | 798,100 | 827,552 | |
Deposits with non-US regulatory authorities | |||
Restricted Assets [Line Items] | |||
Restricted assets | $ 506,517 | 179,099 | |
Somers Holdings Ltd. | |||
Restricted Assets [Line Items] | |||
Restricted assets | $ 1,036,000 | ||
[1] | 2020 balances included $1.036 billion related to Somers. |
Investment Information - Cash a
Investment Information - Cash and restricted cash (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure Investment Information [Abstract] | ||||
Cash | $ 858,668 | $ 906,448 | $ 726,230 | |
Restricted cash (included in ‘other assets’) | 456,103 | 384,096 | 177,468 | |
Cash and restricted cash | $ 1,314,771 | $ 1,290,544 | $ 903,698 | $ 724,643 |
Investment Information - Narrat
Investment Information - Narrative (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021USD ($)lots | Dec. 31, 2020USD ($)lots | Dec. 31, 2019USD ($) | |
Continuous unrealized loss, qualitative disclosures: | |||
Number of positions in an unrealized loss position (lots) | lots | 4,700 | 2,320 | |
Total number of positions (lots) | lots | 10,240 | 11,180 | |
Largest single loss | $ 1,100 | $ 900 | |
Equity securities, at fair value | 1,804,170 | 1,444,830 | |
Equity Method Investment, Financial Statement, Reported Amounts [Abstract] | |||
Equity in net income (loss) of investment funds accounted for using the equity method | $ 366,402 | $ 146,693 | $ 123,672 |
Equity method investments, time lag for reporting - low end of range | 1 month | ||
Equity method investments, time lag for reporting - high end of range | 3 months |
Fair Value - Fair Value Hierarc
Fair Value - Fair Value Hierarchy (Details) - Recurring - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | $ 7,602,828 | $ 9,280,391 | ||
Liabilities measured at fair value | 0 | 0 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Contingent consideration liability | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | 0 | 0 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Securities sold but not yet purchased | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | [1] | 0 | 0 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Derivative instruments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | 0 | 0 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Residential Mortgage | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | |||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed maturities and fixed maturities pledged under securities lending agreements | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 4,744,517 | 5,463,356 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed maturities and fixed maturities pledged under securities lending agreements | Corporate bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | [2] | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed maturities and fixed maturities pledged under securities lending agreements | Mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | [2] | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed maturities and fixed maturities pledged under securities lending agreements | Municipal bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | [2] | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed maturities and fixed maturities pledged under securities lending agreements | Commercial mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | [2] | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed maturities and fixed maturities pledged under securities lending agreements | US government and government agencies | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 4,744,517 | 5,463,356 | [2] | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed maturities and fixed maturities pledged under securities lending agreements | Non-US government securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | [2] | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed maturities and fixed maturities pledged under securities lending agreements | Asset backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | [2] | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 1,052,822 | 1,920,565 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Equity securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 1,762,864 | 1,401,653 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Derivative instruments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value option | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 42,625 | 494,817 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value option | Corporate bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value option | Mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | |||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value option | Commercial mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | |||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value option | US government and government agencies | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 164 | |||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value option | Non-US government securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value option | Asset backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value option | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 528 | 420,131 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value option | Equity securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 21,745 | 23,373 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value option | Other investments fair value option | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 20,352 | 51,149 | ||
Significant Other Observable Inputs (Level 2) | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 14,923,923 | 15,724,091 | ||
Liabilities measured at fair value | (54,224) | (130,384) | ||
Significant Other Observable Inputs (Level 2) | Contingent consideration liability | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | 0 | 0 | ||
Significant Other Observable Inputs (Level 2) | Securities sold but not yet purchased | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | [1] | 0 | (21,679) | |
Significant Other Observable Inputs (Level 2) | Derivative instruments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | (54,224) | (108,705) | ||
Significant Other Observable Inputs (Level 2) | Residential Mortgage | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 49,847 | |||
Significant Other Observable Inputs (Level 2) | Fixed maturities and fixed maturities pledged under securities lending agreements | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 13,250,232 | 13,529,813 | ||
Significant Other Observable Inputs (Level 2) | Fixed maturities and fixed maturities pledged under securities lending agreements | Corporate bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 6,553,320 | 7,856,558 | [2] | |
Significant Other Observable Inputs (Level 2) | Fixed maturities and fixed maturities pledged under securities lending agreements | Mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 408,477 | 630,001 | [2] | |
Significant Other Observable Inputs (Level 2) | Fixed maturities and fixed maturities pledged under securities lending agreements | Municipal bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 404,666 | 494,522 | [2] | |
Significant Other Observable Inputs (Level 2) | Fixed maturities and fixed maturities pledged under securities lending agreements | Commercial mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 1,046,484 | 389,900 | [2] | |
Significant Other Observable Inputs (Level 2) | Fixed maturities and fixed maturities pledged under securities lending agreements | US government and government agencies | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 28,247 | 93,721 | [2] | |
Significant Other Observable Inputs (Level 2) | Fixed maturities and fixed maturities pledged under securities lending agreements | Non-US government securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 2,120,294 | 2,433,733 | [2] | |
Significant Other Observable Inputs (Level 2) | Fixed maturities and fixed maturities pledged under securities lending agreements | Asset backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 2,688,744 | 1,631,378 | [2] | |
Significant Other Observable Inputs (Level 2) | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 681,894 | 4,357 | ||
Significant Other Observable Inputs (Level 2) | Equity securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 38,388 | 17,291 | ||
Significant Other Observable Inputs (Level 2) | Derivative instruments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 127,121 | 177,383 | ||
Significant Other Observable Inputs (Level 2) | Fair value option | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 776,441 | 1,995,247 | ||
Significant Other Observable Inputs (Level 2) | Fair value option | Corporate bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 388,546 | 650,309 | ||
Significant Other Observable Inputs (Level 2) | Fair value option | Mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 3,282 | |||
Significant Other Observable Inputs (Level 2) | Fair value option | Commercial mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 1,090 | |||
Significant Other Observable Inputs (Level 2) | Fair value option | US government and government agencies | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 110 | |||
Significant Other Observable Inputs (Level 2) | Fair value option | Non-US government securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 23,785 | 35,263 | ||
Significant Other Observable Inputs (Level 2) | Fair value option | Asset backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 4,367 | 152,151 | ||
Significant Other Observable Inputs (Level 2) | Fair value option | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 97,278 | 136,877 | ||
Significant Other Observable Inputs (Level 2) | Fair value option | Equity securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 188 | ||
Significant Other Observable Inputs (Level 2) | Fair value option | Other investments fair value option | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 262,465 | 1,015,977 | ||
Significant Unobservable Inputs (Level 3) | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 39,007 | 182,530 | ||
Liabilities measured at fair value | (16,960) | (461) | ||
Significant Unobservable Inputs (Level 3) | Contingent consideration liability | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | (16,960) | (461) | ||
Significant Unobservable Inputs (Level 3) | Securities sold but not yet purchased | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | [1] | 0 | 0 | |
Significant Unobservable Inputs (Level 3) | Derivative instruments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | 0 | 0 | ||
Significant Unobservable Inputs (Level 3) | Residential Mortgage | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | |||
Significant Unobservable Inputs (Level 3) | Fixed maturities and fixed maturities pledged under securities lending agreements | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 3,360 | 3,439 | ||
Significant Unobservable Inputs (Level 3) | Fixed maturities and fixed maturities pledged under securities lending agreements | Corporate bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 13 | 13 | [2] | |
Significant Unobservable Inputs (Level 3) | Fixed maturities and fixed maturities pledged under securities lending agreements | Mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | [2] | |
Significant Unobservable Inputs (Level 3) | Fixed maturities and fixed maturities pledged under securities lending agreements | Municipal bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | [2] | |
Significant Unobservable Inputs (Level 3) | Fixed maturities and fixed maturities pledged under securities lending agreements | Commercial mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | [2] | |
Significant Unobservable Inputs (Level 3) | Fixed maturities and fixed maturities pledged under securities lending agreements | US government and government agencies | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | [2] | |
Significant Unobservable Inputs (Level 3) | Fixed maturities and fixed maturities pledged under securities lending agreements | Non-US government securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | [2] | |
Significant Unobservable Inputs (Level 3) | Fixed maturities and fixed maturities pledged under securities lending agreements | Asset backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 3,347 | 3,426 | [2] | |
Significant Unobservable Inputs (Level 3) | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | ||
Significant Unobservable Inputs (Level 3) | Equity securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 2,918 | 42,015 | ||
Significant Unobservable Inputs (Level 3) | Derivative instruments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | ||
Significant Unobservable Inputs (Level 3) | Fair value option | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 32,729 | 137,076 | ||
Significant Unobservable Inputs (Level 3) | Fair value option | Corporate bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 985 | ||
Significant Unobservable Inputs (Level 3) | Fair value option | Mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | |||
Significant Unobservable Inputs (Level 3) | Fair value option | Commercial mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | |||
Significant Unobservable Inputs (Level 3) | Fair value option | US government and government agencies | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | |||
Significant Unobservable Inputs (Level 3) | Fair value option | Non-US government securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | ||
Significant Unobservable Inputs (Level 3) | Fair value option | Asset backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | ||
Significant Unobservable Inputs (Level 3) | Fair value option | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | 0 | ||
Significant Unobservable Inputs (Level 3) | Fair value option | Equity securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 4,748 | 68,988 | ||
Significant Unobservable Inputs (Level 3) | Fair value option | Other investments fair value option | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 27,981 | 67,103 | ||
Estimated Fair Value | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 23,687,513 | 26,384,668 | ||
Liabilities measured at fair value | (71,184) | (130,845) | ||
Estimated Fair Value | Contingent consideration liability | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | (16,960) | (461) | ||
Estimated Fair Value | Securities sold but not yet purchased | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | [1] | 0 | (21,679) | |
Estimated Fair Value | Derivative instruments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities measured at fair value | (54,224) | (108,705) | ||
Estimated Fair Value | Residential Mortgage | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 49,847 | |||
Estimated Fair Value | Fixed maturities and fixed maturities pledged under securities lending agreements | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 17,998,109 | 18,996,608 | ||
Estimated Fair Value | Fixed maturities and fixed maturities pledged under securities lending agreements | Corporate bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 6,553,333 | 7,856,571 | [2] | |
Estimated Fair Value | Fixed maturities and fixed maturities pledged under securities lending agreements | Mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 408,477 | 630,001 | [2] | |
Estimated Fair Value | Fixed maturities and fixed maturities pledged under securities lending agreements | Municipal bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 404,666 | 494,522 | [2] | |
Estimated Fair Value | Fixed maturities and fixed maturities pledged under securities lending agreements | Commercial mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 1,046,484 | 389,900 | [2] | |
Estimated Fair Value | Fixed maturities and fixed maturities pledged under securities lending agreements | US government and government agencies | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 4,772,764 | 5,557,077 | [2] | |
Estimated Fair Value | Fixed maturities and fixed maturities pledged under securities lending agreements | Non-US government securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 2,120,294 | 2,433,733 | [2] | |
Estimated Fair Value | Fixed maturities and fixed maturities pledged under securities lending agreements | Asset backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 2,692,091 | 1,634,804 | [2] | |
Estimated Fair Value | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 1,734,716 | 1,924,922 | ||
Estimated Fair Value | Equity securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 1,804,170 | 1,460,959 | ||
Estimated Fair Value | Derivative instruments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 127,121 | 177,383 | ||
Estimated Fair Value | Fair value option | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 1,973,550 | 3,824,796 | ||
Estimated Fair Value | Fair value option | Corporate bonds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 388,546 | 651,294 | ||
Estimated Fair Value | Fair value option | Mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 3,282 | |||
Estimated Fair Value | Fair value option | Commercial mortgage backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 1,090 | |||
Estimated Fair Value | Fair value option | US government and government agencies | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 274 | |||
Estimated Fair Value | Fair value option | Non-US government securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 23,785 | 35,263 | ||
Estimated Fair Value | Fair value option | Asset backed securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 4,367 | 152,151 | ||
Estimated Fair Value | Fair value option | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 97,806 | 557,008 | ||
Estimated Fair Value | Fair value option | Equity securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 26,493 | 92,549 | ||
Estimated Fair Value | Fair value option | Other investments fair value option | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 310,798 | 1,134,229 | ||
Estimated Fair Value | Fair value option | Other investments at net asset value | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | [3] | $ 1,121,755 | $ 1,197,656 | |
[1] | Represents the Company’s obligations to deliver securities that it did not own at the time of sale. Such amounts are included in “other liabilities” on the Company’s consolidated balance sheets. | |||
[2] | In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities pledged. For purposes of this table, the Company has excluded the collateral received under securities lending, at fair value and included the securities pledged under securities lending, at fair value. See “—Securities Lending Agreements.” In 2021, the Company terminated its securities lending program and no longer enters into securities lending agreements with financial institutions. | |||
[3] | In accordance with applicable accounting guidance, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets. |
Fair Value - Rollforward of Lev
Fair Value - Rollforward of Level 3 assets and liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | |||
Contingent consideration liability | ||||
Level 3 liabilities rollforward | ||||
Balance at beginning of year | $ (461) | $ (7,998) | ||
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | 0 | (72) | |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | 0 | 0 | ||
Purchases, issuances, sales and settlements | ||||
Purchases | (16,494) | 0 | ||
Issuances | 0 | 0 | ||
Sales | 0 | [2] | 0 | |
Settlements | (5) | 7,609 | ||
Transfers in and/or out of Level 3 | 0 | 0 | ||
Balance at end of year | (16,960) | (461) | ||
Equity securities | ||||
Level 3 assets rollforward | ||||
Balance at beginning of year | 42,015 | 55,889 | ||
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | 1,958 | 8,214 | |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | 0 | 0 | ||
Purchases, issuances, sales and settlements | ||||
Purchases | 5,718 | 4,030 | ||
Issuances | 0 | 0 | ||
Sales | (46,773) | [2] | (26,118) | |
Settlements | 0 | 0 | ||
Transfers in and/or out of Level 3 | 0 | 0 | ||
Balance at end of year | 2,918 | 42,015 | ||
Available for sale | Structured securities | ||||
Level 3 assets rollforward | ||||
Balance at beginning of year | [3] | 3,426 | 5,216 | |
Total gains or (losses) (realized/unrealized) - included in earnings | [1],[3] | (135) | 0 | |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | [3] | 133 | (169) | |
Purchases, issuances, sales and settlements | ||||
Purchases | [3] | 0 | 0 | |
Issuances | [3] | 0 | 0 | |
Sales | [3] | 0 | [2] | 0 |
Settlements | [3] | (77) | (1,413) | |
Transfers in and/or out of Level 3 | [3] | 0 | (208) | |
Balance at end of year | [3] | 3,347 | 3,426 | |
Available for sale | Corporate bonds | ||||
Level 3 assets rollforward | ||||
Balance at beginning of year | 13 | 8,851 | ||
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | 0 | (5,865) | |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | 0 | 397 | ||
Purchases, issuances, sales and settlements | ||||
Purchases | 0 | 0 | ||
Issuances | 0 | 0 | ||
Sales | 0 | [2] | 0 | |
Settlements | 0 | (1,462) | ||
Transfers in and/or out of Level 3 | 0 | (1,908) | ||
Balance at end of year | 13 | 13 | ||
Fair value option | Corporate bonds | ||||
Level 3 assets rollforward | ||||
Balance at beginning of year | 985 | 932 | ||
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | 13 | (13) | |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | 0 | 0 | ||
Purchases, issuances, sales and settlements | ||||
Purchases | 0 | 66 | ||
Issuances | 0 | 0 | ||
Sales | (998) | [2] | 0 | |
Settlements | 0 | 0 | ||
Transfers in and/or out of Level 3 | 0 | 0 | ||
Balance at end of year | 0 | 985 | ||
Fair value option | Other investments | ||||
Level 3 assets rollforward | ||||
Balance at beginning of year | 67,103 | 68,817 | ||
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | 868 | (314) | |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | 0 | 0 | ||
Purchases, issuances, sales and settlements | ||||
Purchases | 13,213 | 52,449 | ||
Issuances | 0 | 0 | ||
Sales | (53,203) | [2] | (56,833) | |
Settlements | 0 | 0 | ||
Transfers in and/or out of Level 3 | 0 | 2,984 | ||
Balance at end of year | 27,981 | 67,103 | ||
Fair value option | Equity securities | ||||
Level 3 assets rollforward | ||||
Balance at beginning of year | 68,988 | 58,094 | ||
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | 4,941 | 10,894 | |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | 0 | 0 | ||
Purchases, issuances, sales and settlements | ||||
Purchases | 0 | 0 | ||
Issuances | 0 | 0 | ||
Sales | (69,181) | [2] | 0 | |
Settlements | 0 | 0 | ||
Transfers in and/or out of Level 3 | 0 | 0 | ||
Balance at end of year | $ 4,748 | $ 68,988 | ||
[1] | Gains or losses were included in net realized gains (losses). | |||
[2] | Sales for the 2021 period primarily relates to the Company’s deconsolidation of Somers | |||
[3] | Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities |
Fair Value - Narrative (Details
Fair Value - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior notes | $ 2,724,394 | $ 2,861,113 |
Total assets and liabilities measured at fair value | 23,800,000 | 26,500,000 |
Total assets and liabilities measured at fair value priced using non-binding broker quotes | $ 7,700 | $ 150,100 |
Total assets and liabilities measured at fair value priced using non-binding broker quotes (percentage) | 0.00% | 0.60% |
Unsecured debt | Senior Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior notes | $ 2,700,000 | $ 2,900,000 |
Estimated fair value of senior notes | $ 3,300,000 | $ 3,700,000 |
Derivative Instruments (Details
Derivative Instruments (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Derivative offsetting [Abstract] | ||||
Derivative assets subject to master netting agreements | $ 122,300 | $ 138,800 | ||
Derivative liabilities subject to master netting agreements | 53,900 | 93,000 | ||
Net realized gains (losses) on derivative instruments | ||||
Net realized gains (losses) on derivative instruments | (32,390) | 179,675 | $ 119,741 | |
Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Asset derivatives - fair value | 127,121 | 177,383 | ||
Liability derivatives - fair value | (54,224) | (108,705) | ||
Net realized gains (losses) on derivative instruments | ||||
Net realized gains (losses) on derivative instruments | (32,390) | 179,675 | 119,741 | |
Not Designated as Hedging Instrument | Futures contracts | ||||
Derivative [Line Items] | ||||
Net derivatives - notional value | [1],[2] | 2,826,564 | 3,099,796 | |
Net realized gains (losses) on derivative instruments | ||||
Net realized gains (losses) on derivative instruments | (15,262) | 114,987 | 114,123 | |
Not Designated as Hedging Instrument | Futures contracts | Other assets | ||||
Derivative [Line Items] | ||||
Asset derivatives - fair value | [2] | 34,999 | 11,046 | |
Not Designated as Hedging Instrument | Futures contracts | Other liabilities | ||||
Derivative [Line Items] | ||||
Liability derivatives - fair value | [2] | (9,808) | (4,496) | |
Not Designated as Hedging Instrument | Foreign currency forward contracts | ||||
Derivative [Line Items] | ||||
Net derivatives - notional value | [1],[2] | 915,962 | 1,656,729 | |
Net realized gains (losses) on derivative instruments | ||||
Net realized gains (losses) on derivative instruments | (39,755) | 49,974 | (9,499) | |
Not Designated as Hedging Instrument | Foreign currency forward contracts | Other assets | ||||
Derivative [Line Items] | ||||
Asset derivatives - fair value | [2] | 7,734 | 52,716 | |
Not Designated as Hedging Instrument | Foreign currency forward contracts | Other liabilities | ||||
Derivative [Line Items] | ||||
Liability derivatives - fair value | [2] | (11,390) | (6,202) | |
Not Designated as Hedging Instrument | TBAs | ||||
Derivative [Line Items] | ||||
Net derivatives - notional value | [1] | 11,227 | 0 | |
Net realized gains (losses) on derivative instruments | ||||
Net realized gains (losses) on derivative instruments | (233) | 1,129 | 463 | |
Not Designated as Hedging Instrument | TBAs | Fixed maturities available for sale, at fair value | ||||
Derivative [Line Items] | ||||
Asset derivatives - fair value | 11,227 | 0 | ||
Liability derivatives - fair value | 0 | 0 | ||
Not Designated as Hedging Instrument | Other | ||||
Derivative [Line Items] | ||||
Net derivatives - notional value | [1],[2] | 3,736,773 | 5,763,919 | |
Net realized gains (losses) on derivative instruments | ||||
Net realized gains (losses) on derivative instruments | 22,860 | 13,585 | $ 14,654 | |
Not Designated as Hedging Instrument | Other | Other assets | ||||
Derivative [Line Items] | ||||
Asset derivatives - fair value | [2] | 73,161 | 113,621 | |
Not Designated as Hedging Instrument | Other | Other liabilities | ||||
Derivative [Line Items] | ||||
Liability derivatives - fair value | [2] | $ (33,026) | $ (98,007) | |
[1] | Represents the absolute notional value of all outstanding contracts, consisting of long and short positions. | |||
[2] | The fair value of asset derivatives are included in ‘other assets’ and the fair value of liability derivatives are included in ‘other liabilities.’ |
Variable Interest Entity and _3
Variable Interest Entity and Noncontrolling Interests - Variable interest entity (Details) - USD ($) $ in Thousands | 1 Months Ended | ||
Mar. 31, 2014 | Jul. 01, 2021 | Mar. 31, 2015 | |
Greysbridge Holdings Ltd | |||
Variable Interest Entity [Line Items] | |||
Percentage ownership | 40.00% | ||
Greysbridge Holdings Ltd | Kelso And Company | |||
Variable Interest Entity [Line Items] | |||
Percentage ownership | 30.00% | ||
Greysbridge Holdings Ltd | Warburg Pincus | |||
Variable Interest Entity [Line Items] | |||
Percentage ownership | 30.00% | ||
Variable Interest Entity, Primary Beneficiary | Somers Holdings Ltd. | |||
Variable Interest Entity [Line Items] | |||
Initial investment contribution amount | $ 100,000 | ||
Variable Interest Entity, Primary Beneficiary | Common shares | Somers Holdings Ltd. | |||
Variable Interest Entity [Line Items] | |||
Number of shares acquired | 2,500,000 |
Variable Interest Entity and _4
Variable Interest Entity and Noncontrolling Interests - Carrying amount of assets and liabilities of variable interest entity (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Assets | |||||
Investments accounted for using the fair value option | $ 1,973,550 | $ 3,824,796 | |||
Fixed maturities available for sale, at fair value | 17,998,109 | 18,717,825 | |||
Equity securities, at fair value | 1,804,170 | 1,444,830 | |||
Cash | 858,668 | 906,448 | $ 726,230 | ||
Accrued investment income | 85,453 | 103,299 | |||
Premiums receivable | 2,633,280 | 2,064,586 | 1,778,717 | ||
Ceded unearned premiums | 1,729,455 | 1,234,075 | |||
Deferred acquisition costs | 901,841 | 790,708 | |||
Receivable for securities sold | 60,179 | 92,743 | |||
Goodwill and intangible assets | 944,983 | 692,863 | 738,083 | ||
Other assets | 2,453,849 | 1,724,288 | |||
Total assets of consolidated VIE | 45,100,945 | 43,282,297 | 37,885,361 | ||
Liabilities | |||||
Reserve for losses and loss adjustment expenses | 17,757,156 | 16,513,929 | 13,891,842 | $ 11,853,297 | |
Unearned premiums | 6,011,942 | 4,838,965 | |||
Reinsurance balances payable | 1,583,253 | 683,263 | |||
Revolving credit agreement borrowings | 0 | 155,687 | |||
Senior notes | 2,724,394 | 2,861,113 | |||
Payable for securities purchased | 64,850 | 218,779 | |||
Other liabilities | 1,329,742 | 1,510,888 | |||
Total liabilities of consolidated VIE | $ 31,545,816 | 29,294,856 | $ 25,569,809 | ||
Somers Holdings Ltd. | Variable Interest Entity, Primary Beneficiary | |||||
Assets | |||||
Investments accounted for using the fair value option | [1] | 1,790,385 | |||
Fixed maturities available for sale, at fair value | 655,249 | ||||
Equity securities, at fair value | 52,410 | ||||
Cash | 211,451 | ||||
Accrued investment income | 14,679 | ||||
Premiums receivable | 224,377 | ||||
Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses | 286,590 | ||||
Ceded unearned premiums | 122,339 | ||||
Deferred acquisition costs | 53,705 | ||||
Receivable for securities sold | 37,423 | ||||
Goodwill and intangible assets | 7,650 | ||||
Other assets | 75,801 | ||||
Total assets of consolidated VIE | 3,532,059 | ||||
Liabilities | |||||
Reserve for losses and loss adjustment expenses | 1,519,583 | ||||
Unearned premiums | 407,714 | ||||
Reinsurance balances payable | 63,269 | ||||
Revolving credit agreement borrowings | 155,687 | ||||
Senior notes | 172,689 | ||||
Payable for securities purchased | 25,881 | ||||
Other liabilities | 193,494 | ||||
Total liabilities of consolidated VIE | 2,538,317 | ||||
Redeemable noncontrolling interests | $ 52,398 | ||||
[1] | Included in “other investments” on the Company’s balance sheet |
Variable Interest Entity and _5
Variable Interest Entity and Noncontrolling Interests - Cash flows of variable interest entity (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Variable Interest Entity [Line Items] | |||
Net Cash Provided by (Used in) Operating Activities | $ 3,427,555 | $ 2,886,505 | $ 2,048,459 |
Net cash provided by (used for) investing activities | (2,139,732) | (3,043,226) | (1,806,483) |
Net Cash Provided by (Used in) Financing Activities | (1,229,549) | 521,278 | (80,662) |
Somers Holdings Ltd. | Variable Interest Entity, Primary Beneficiary | |||
Variable Interest Entity [Line Items] | |||
Net Cash Provided by (Used in) Operating Activities | 46,991 | 181,736 | 239,284 |
Net cash provided by (used for) investing activities | 96,325 | 258,589 | (140,620) |
Net Cash Provided by (Used in) Financing Activities | $ (2,042) | $ (335,776) | $ (61,433) |
Variable Interest Entity and _6
Variable Interest Entity and Noncontrolling Interests - Non-redeemable noncontrolling interest (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Noncontrolling Interest [Line Items] | |||
Non-redeemable noncontrolling interest, beginning of year | $ 823,007 | $ 762,777 | |
Amounts attributable to nonredeemable noncontrolling interests | (78,314) | (53,076) | $ (40,072) |
Other comprehensive (income) loss attributable to noncontrolling interests | 13,984 | (9,062) | (9,130) |
Non-redeemable noncontrolling interest, end of year | 0 | $ 823,007 | 762,777 |
Somers Holdings Ltd. | |||
Noncontrolling Interest [Line Items] | |||
Noncontrolling interest, ownership percentage by noncontrolling owners | 87.00% | ||
Somers Holdings Ltd. | Noncontrolling Interest | |||
Noncontrolling Interest [Line Items] | |||
Non-redeemable noncontrolling interest, beginning of year | 823,007 | $ 762,777 | |
Impact of deconsolidation of Somers | (918,874) | 0 | |
Additional paid in capital attributable to noncontrolling interests | 22,113 | 1,334 | |
Repurchases attributable to non-redeemable noncontrolling interests | 0 | (2,867) | |
Amounts attributable to nonredeemable noncontrolling interests | 78,314 | 53,076 | |
Other Amounts Attributable to Noncontrolling Interests | 0 | (375) | |
Other comprehensive (income) loss attributable to noncontrolling interests | (4,560) | 9,062 | |
Non-redeemable noncontrolling interest, end of year | $ 0 | $ 823,007 | $ 762,777 |
Variable Interest Entity and _7
Variable Interest Entity and Noncontrolling Interests - Redeemable noncontrolling interest (Details) - USD ($) | Aug. 01, 2019 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Jul. 31, 2019 | Mar. 31, 2014 |
Redeemable Noncontrolling Interest [Line Items] | ||||||
Balance, beginning of year | $ 58,548,000 | $ 55,404,000 | $ 206,292,000 | |||
Impact of deconsolidation of Somers | (48,919,000) | 0 | 0 | |||
Redemption of noncontrolling interests | 0 | 0 | (157,709,000) | |||
Accretion of preference share issuance costs | 0 | 93,000 | 244,000 | |||
Other | (396,000) | 3,051,000 | 6,577,000 | |||
Balance, end of year | $ 9,233,000 | 58,548,000 | 55,404,000 | |||
Preferred shares, par value per share | $ 0.01 | |||||
Somers Holdings Ltd. | ||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||
Preferred dividends including accretion of discount and issuance costs | $ 2,100,000 | 4,400,000 | $ 17,800,000 | |||
Variable Interest Entity, Primary Beneficiary | Somers Holdings Ltd. | ||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||
Preference shares, number of shares issued | 9,065,200 | |||||
Shares redeemed during the period, shares | 6,919,998 | |||||
Preferred shares, redemption price per share | $ 25.19748 | |||||
Proceeds from Redemption Of Preferred Shares By Variable Interest Entity | $ 11,500,000 | |||||
Noncontrolling Interest | Somers Holdings Ltd. | ||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||
Impact of deconsolidation of Somers | $ (918,874,000) | $ 0 | ||||
Redeemable Preferred Stock [Member] | Somers Holdings Ltd. | ||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||
Preferred shares, par value per share | $ 0.01 | |||||
Liquidation preference per share | 25 | |||||
Shares Issued, Price Per Share | $ 24.50 |
Variable Interest Entity and _8
Variable Interest Entity and Noncontrolling Interests - Income or loss attributable to third party investors (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Noncontrolling Interest [Line Items] | |||
Amounts attributable to non-redeemable noncontrolling interests | $ (78,314) | $ (53,076) | $ (40,072) |
Amounts attributable to redeemable noncontrolling interests | (4,299) | (7,114) | (16,909) |
Net (income) loss attributable to noncontrolling interests | $ (82,613) | $ (60,190) | $ (56,981) |
Variable Interest Entity and _9
Variable Interest Entity and Noncontrolling Interests - Other variable interest entity disclosures (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | $ 45,100,945 | $ 43,282,297 | $ 37,885,361 | ||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 3,248,206 | 2,232,609 | |||
Bellemeade 2020-2 Ltd | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Remaining Coverage, Amount | 1,000 | ||||
Bellemeade 2020-3 Ltd | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Remaining Coverage, Amount | 16,000 | ||||
Bellemeade 2020-4 Ltd | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Remaining Coverage, Amount | 9,000 | ||||
Bellemeade 2021-1 Ltd Member | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Remaining Coverage, Amount | 61,000 | ||||
Bellemeade 2021-2 Ltd | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Remaining Coverage, Amount | 93,000 | ||||
Bellemeade 2021-3 Ltd | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Remaining Coverage, Amount | 131,000 | ||||
Variable Interest Entity, Not Primary Beneficiary | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 4,336,596 | 3,859,058 | |||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | (4,434) | (7,969) | |||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 42,202 | 56,320 | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 37,768 | 48,351 | |||
Initial Coverage at Issuance | 6,626,664 | ||||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2017-1 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 108,368 | 145,573 | |||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | (159) | (245) | |||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 424 | 844 | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 265 | 599 | |||
Initial Coverage at Issuance | [1] | 368,114 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2018-1 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 181,136 | 250,095 | |||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | (528) | (903) | |||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 1,268 | 2,245 | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 740 | 1,342 | |||
Initial Coverage at Issuance | [2] | 374,460 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2018-2 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | 108,395 | |||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | 0 | (138) | |||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 0 | 280 | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 0 | 142 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2018-3 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 302,563 | 302,563 | |||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | (1,018) | (1,320) | |||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 2,496 | 3,262 | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 1,478 | 1,942 | |||
Initial Coverage at Issuance | [3] | 506,110 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2019-1 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 181,324 | 219,256 | |||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | (380) | (1,361) | |||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 5,807 | 8,461 | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 5,427 | 7,100 | |||
Initial Coverage at Issuance | [4] | 341,790 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2019-2 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 398,316 | 398,316 | |||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | (515) | (730) | |||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 3,998 | 5,201 | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 3,483 | 4,471 | |||
Initial Coverage at Issuance | [5] | 621,022 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2019-3 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 409,859 | 528,084 | |||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | (584) | (861) | |||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 3,190 | 5,079 | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 2,606 | 4,218 | |||
Initial Coverage at Issuance | [6] | 700,920 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2019-4 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 411,954 | 468,737 | |||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | (462) | (890) | |||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 4,759 | 6,676 | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 4,297 | 5,786 | |||
Initial Coverage at Issuance | [7] | 577,267 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2020-1 Ltd. | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | 275,068 | |||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | 0 | (178) | |||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 0 | 1,012 | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 0 | 834 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2020-2 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | [8] | 217,766 | 423,420 | ||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | [8] | (177) | (556) | ||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | [8] | 1,984 | 6,839 | ||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | [8] | 1,807 | 6,283 | ||
Initial Coverage at Issuance | [9] | 449,167 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2020-2 Ltd | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Initial Coverage at Issuance | 26,000 | ||||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2020-3 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | [10] | 348,818 | 418,158 | ||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | [10] | (128) | (631) | ||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | [10] | 5,793 | 9,605 | ||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | [10] | 5,665 | 8,974 | ||
Initial Coverage at Issuance | [11] | 451,816 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2020-3 Ltd | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Initial Coverage at Issuance | 34,000 | ||||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2020-4 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | [12] | 176,826 | 321,393 | ||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | [12] | (50) | (156) | ||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | [12] | 1,630 | 6,816 | ||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | [12] | 1,580 | 6,660 | ||
Initial Coverage at Issuance | [13] | 337,013 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2020-4 Ltd | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Initial Coverage at Issuance | 16,000 | ||||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2021-1 Ltd Member | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 568,986 | [14] | 0 | ||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | (303) | [14] | 0 | ||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 3,283 | [14] | 0 | ||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 2,980 | [14] | 0 | ||
Initial Coverage at Issuance | [15] | 643,577 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2021-1 Ltd Member | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Initial Coverage at Issuance | 64,000 | ||||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2021-2 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 522,807 | [16] | 0 | ||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | 281 | [16] | 0 | ||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 4,124 | [16] | 0 | ||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 4,405 | [16] | 0 | ||
Initial Coverage at Issuance | [17] | 616,017 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2021-2 Ltd | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Initial Coverage at Issuance | 93,000 | ||||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2021-3 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 507,873 | [18] | 0 | ||
Variable Interest Entity, Maximum Exposure to Loss, On Balance Sheet, Asset (Liability) Net | (411) | [18] | 0 | ||
Variable Interest Entity, Maximum Exposure to Loss, Off Balance Sheet | 3,446 | [18] | 0 | ||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 3,035 | [18] | $ 0 | ||
Initial Coverage at Issuance | [19] | 639,391 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2021-3 Ltd | Directly provided capacity | |||||
Variable Interest Entity [Line Items] | |||||
Initial Coverage at Issuance | $ 131,000 | ||||
[1] | Issued in October 2017, covering in-force policies issued between January 1, 2017 and June 30, 2017. | ||||
[2] | Issued in April 2018, covering in-force policies issued between July 1, 2017 and December 31, 2017. | ||||
[3] | Issued in October 2018, covering in-force policies issued between January 1, 2018 and June 30, 2018. | ||||
[4] | Issued in March 2019, covering in-force policies primarily issued between 2005 to 2008 under United Guaranty Residential Insurance Company (“UGRIC”); as well as policies issued through 2015 under both UGRIC and Arch Mortgage Insurance Company. | ||||
[5] | Issued in April 2019, covering in-force policies issued between July 1, 2018 and December 31, 2018. | ||||
[6] | Issued in July 2019, covering in-force policies issued in 2016. | ||||
[7] | Issued in October 2019, covering in-force policies issued between January 1, 2019 and June 30, 2019. | ||||
[8] | At December 31, 2021, $1 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table) | ||||
[9] | Issued in September 2020, covering in-force policies issued between January 1, 2020 and May 31, 2020. $423 million was directly funded by Bellemeade 2020-2 Ltd. with an additional $26 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers | ||||
[10] | At December 31, 2021, $16 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). | ||||
[11] | Issued in November 2020, covering in-force policies issued between June 1, 2020 and August 31, 2020. $418 million was directly funded by Bellemeade 2020-3 Ltd. with an additional $34 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. | ||||
[12] | At December 31, 2021, $9 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). | ||||
[13] | Issued in December 2020, covering in-force policies issued between July 1, 2019 and December 31, 2019. $321 million was directly funded by Bellemeade 2020-4 Ltd. with an additional $16 million of capacity provided directly to Arch MI U.S. by a separate panel of reinsurers | ||||
[14] | At December 31, 2021, $61 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). | ||||
[15] | Issued in March 2021, covering in-force policies issued between September 1, 2020 and November 30, 2020. $580 million was directly funded by Bellemeade Re 2021-1 Ltd. with an additional $64 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. | ||||
[16] | At December 31, 2021, $93 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). | ||||
[17] | Issued in June 2021, covering in-force policies issued between December 1, 2020 and March 31, 2021. $523 million was directly funded by Bellemeade Re 2021-2 Ltd. via insurance-linked notes, with an additional $93 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers | ||||
[18] | At December 31, 2021, $131 million of coverage from a separate panel of reinsurers is remaining (not reflected in this table). | ||||
[19] | Issued in September 2021, covering in-force policies issued between April 1, 2021 and June 30, 2021. $508 million was directly funded by Bellemeade Re 2021-3 Ltd. via insurance-linked notes, with an additional $131 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers |
Other Comprehensive Income - Co
Other Comprehensive Income - Components of accumulated other comprehensive income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | $ 488,895 | $ 212,091 | $ (178,720) |
Other comprehensive income (loss) before reclassifications | (437,427) | 702,991 | 509,752 |
Amounts reclassified from accumulated other comprehensive income | (116,068) | (426,187) | (118,941) |
Net current period other comprehensive income (loss) | (553,495) | 276,804 | 390,811 |
Ending balance | (64,600) | 488,895 | 212,091 |
Unrealized Appreciation on Available-For-Sale Investments | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | 501,295 | 258,486 | (114,178) |
Other comprehensive income (loss) before reclassifications | (371,741) | 668,996 | 491,605 |
Amounts reclassified from accumulated other comprehensive income | (116,068) | (426,187) | (118,941) |
Net current period other comprehensive income (loss) | (487,809) | 242,809 | 372,664 |
Ending balance | 13,486 | 501,295 | 258,486 |
Foreign Currency Translation Adjustments | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | (12,400) | (46,395) | (64,542) |
Other comprehensive income (loss) before reclassifications | (65,686) | 33,995 | 18,147 |
Amounts reclassified from accumulated other comprehensive income | 0 | 0 | 0 |
Net current period other comprehensive income (loss) | (65,686) | 33,995 | 18,147 |
Ending balance | $ (78,086) | $ (12,400) | $ (46,395) |
Other Comprehensive Income - Am
Other Comprehensive Income - Amounts reclassified from accumulated other comprehensive income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||
Provision for credit losses | $ (2,100) | $ (3,597) | $ 0 |
Other-than-temporary impairment losses | 0 | (533) | |
Other-than-temporary Impairment Loss, Debt Securities, Available-for-sale, Recognized in Earnings | (3,165) | ||
Income (loss) before income taxes | 2,368,042 | 1,577,549 | 1,849,110 |
Income tax (expense) benefit | (128,582) | (111,838) | (155,810) |
Net of tax | 2,156,849 | 1,405,521 | 1,636,319 |
Reclassification out of accumulated other comprehensive income | Unrealized Appreciation on Available-For-Sale Investments | |||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||
Net realized gains (losses) | 157,095 | 478,659 | 131,043 |
Provision for credit losses | (2,099) | (3,597) | 0 |
Other-than-temporary impairment losses | 0 | (533) | |
Other-than-temporary Impairment Loss, Debt Securities, Available-for-sale, Recognized in Earnings | (3,165) | ||
Income (loss) before income taxes | 154,996 | 474,529 | 127,878 |
Income tax (expense) benefit | (38,928) | (48,342) | (8,937) |
Net of tax | $ 116,068 | $ 426,187 | $ 118,941 |
Other Comprehensive Income - Ta
Other Comprehensive Income - Tax effects on components of other comprehensive income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Before tax amount: | |||
Unrealized holding gains (losses) arising during period, before tax | $ (406,774) | $ 754,572 | $ 562,576 |
Less reclassification of net realized gains (losses) included in net income, before tax | 154,996 | 474,529 | 127,878 |
Foreign currency translation adjustments, before tax | (64,423) | 33,706 | 18,463 |
Other comprehensive income (loss), before tax | (626,193) | 313,749 | 453,161 |
Tax expense (benefit): | |||
Unrealized holding gains (losses) arising during period, tax | (19,845) | 75,855 | 61,805 |
Less reclassification of net realized gains (losses) included in net income, tax | 38,928 | 48,342 | 8,937 |
Foreign currency translation adjustments, tax | 59 | 370 | 353 |
Other comprehensive income (loss), tax | (58,714) | 27,883 | 53,221 |
Net of tax amount: | |||
Unrealized holding gains (losses) arising during period, net of tax | (386,929) | 678,717 | 500,771 |
Less reclassification of net realized gains (losses) included in net income, net of tax | 116,068 | 426,187 | 118,941 |
Foreign currency translation adjustments, net of tax | (64,482) | 33,336 | 18,110 |
Net current period other comprehensive income (loss) | $ (567,479) | $ 285,866 | $ 399,940 |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Numerator: | ||||
Net income | $ 2,239,462 | $ 1,465,711 | $ 1,693,300 | |
Net (income) loss attributable to noncontrolling interests | (82,613) | (60,190) | (56,981) | |
Net income available to Arch | 2,156,849 | 1,405,521 | 1,636,319 | |
Preferred share dividends | (48,343) | (41,612) | (41,612) | |
Loss on redemption of preferred shares | (15,101) | 0 | 0 | |
Net income available to Arch common shareholders | $ 2,093,405 | $ 1,363,909 | $ 1,594,707 | |
Denominator: | ||||
Weighted average common shares outstanding | 391,748,715 | 403,062,179 | 401,802,815 | |
Effect of dilutive common share equivalents: | ||||
Nonvested restricted shares | 1,996,524 | 1,682,309 | 1,673,770 | |
Stock options | [1] | 6,600,697 | 5,514,967 | 8,132,893 |
Weighted average common shares and common share equivalents outstanding — diluted | 400,345,936 | 410,259,455 | 411,609,478 | |
Earnings per common share: | ||||
Basic (per share) | $ 5.34 | $ 3.38 | $ 3.97 | |
Diluted (per share) | $ 5.23 | $ 3.32 | $ 3.87 | |
Stock Options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per common share (shares) | 2,398,608 | 2,249,821 | 1,302,017 | |
[1] | Certain stock options were not included in the computation of diluted earnings per share where the exercise price of the stock options exceeded the average market price and would have been anti-dilutive or where, when applying the treasury stock method to in-the-money options, the sum of the proceeds, including unrecognized compensation, exceeded the average market price and would have been anti-dilutive. For 2021, 2020 and 2019, the number of stock options excluded were 2,398,608, 2,249,821 and 1,302,017, respectively. |
Income Taxes - Components of in
Income Taxes - Components of income tax (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Current expense (benefit): | |||
United States | $ 284,274 | $ 181,571 | $ 139,407 |
Non-U.S. | 11,259 | 16,091 | 4,954 |
Current Income Tax Expense (Benefit) | 295,533 | 197,662 | 144,361 |
Deferred expense (benefit): | |||
United States | (123,261) | (89,170) | 11,849 |
Non-U.S. | (43,690) | 3,346 | (400) |
Deferred Income Tax Expense (Benefit) | (166,951) | (85,824) | 11,449 |
Income tax expense (benefit) | $ 128,582 | $ 111,838 | $ 155,810 |
Income Taxes - Income before ta
Income Taxes - Income before taxes by jurisdiction (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Line Items] | |||
Income (loss) before income taxes | $ 2,368,042 | $ 1,577,549 | $ 1,849,110 |
Bermuda | |||
Income Tax Disclosure [Line Items] | |||
Income (loss) before income taxes | 1,518,616 | 1,114,117 | 1,122,952 |
United States | |||
Income Tax Disclosure [Line Items] | |||
Income (loss) before income taxes | 643,239 | 409,893 | 701,480 |
Other | |||
Income Tax Disclosure [Line Items] | |||
Income (loss) before income taxes | $ 206,187 | $ 53,539 | $ 24,678 |
Income Taxes - Statutory tax ra
Income Taxes - Statutory tax rate by jurisdiction (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Bermuda | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 0.00% |
United States | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 21.00% |
United Kingdom | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 19.00% |
Ireland | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 12.50% |
Denmark | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 22.00% |
Canada | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 26.50% |
Gibraltar | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 12.50% |
Australia | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 30.00% |
Hong Kong | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 16.50% |
Netherlands | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 25.00% |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of effective tax rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Expected income tax expense (benefit) computed on pre-tax income at weighted average income tax rate | $ 158,269 | $ 111,947 | $ 149,799 |
Addition (reduction) in income tax expense (benefit) resulting from: | |||
Tax-exempt investment income | (23,572) | (1,824) | (3,091) |
Meals and entertainment | 379 | 547 | 1,134 |
State taxes, net of U.S. federal tax benefit | 20,978 | 5,027 | 3,314 |
Foreign branch taxes | 1,998 | 2,094 | 1,231 |
Prior year adjustment | (1,432) | 3,983 | 632 |
Foreign exchange gains & losses | 1,190 | (1,736) | 436 |
Changes in applicable tax rate | 447 | 0 | 0 |
Dividend withholding taxes | 12,211 | 7,105 | 6,510 |
Change in valuation allowance | (40,425) | 13,190 | 1,628 |
Contingent consideration | 0 | 9 | 190 |
Share based compensation | (5,339) | (2,533) | (6,592) |
Effective Income Tax Reconciliation, Intercompany Loan Writeoff, Amount | 0 | (22,083) | 0 |
Other | 3,878 | (3,888) | 619 |
Income tax expense | $ 128,582 | $ 111,838 | $ 155,810 |
Income Taxes - Components of de
Income Taxes - Components of deferred tax assets and liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred income tax assets: | ||
Net operating loss | $ 87,960 | $ 67,142 |
Uncrystallized losses | 0 | 2,926 |
Discounting of net loss reserves | 72,001 | 74,247 |
Net unearned premium reserve | 75,483 | 66,368 |
Compensation liabilities | 28,062 | 27,351 |
Foreign tax credit carryforward | 20,058 | 19,160 |
Interest expense | 755 | 622 |
Goodwill and intangible assets | 0 | 14,450 |
Bad debt reserves | 10,252 | 10,842 |
Depreciation and amortization | 115,041 | 0 |
Lease liability | 21,453 | 23,604 |
Net unrealized foreign exchange gains | 166 | 165 |
Other, net | 0 | 2,318 |
Deferred tax assets before valuation allowance | 431,231 | 309,195 |
Valuation allowance | (43,953) | (88,255) |
Deferred tax assets net of valuation allowance | 387,278 | 220,940 |
Deferred income tax liabilities: | ||
Depreciation and amortization | 0 | (495) |
Deposit accounting liability | (1,578) | (1,751) |
Goodwill and intangibles | (70,549) | 0 |
Lloyds year of account deferral | (12,514) | 0 |
Contingency reserve | (49,486) | (64,593) |
Deferred policy acquisition costs | (25,612) | (42,045) |
Investment related | (7,492) | (9,571) |
Net unrealized appreciation of investments | (8,377) | (66,681) |
Right-of-use asset | (17,406) | (19,239) |
Other, net | (218) | (843) |
Total deferred tax liabilities | (193,232) | (205,218) |
Net deferred income tax assets | $ 194,046 | $ 15,722 |
Income Taxes - Operating loss c
Income Taxes - Operating loss carryfowards and tax credits (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Loss Carryforwards [Line Items] | |||
U.K. foreign tax credits | $ 20,058 | $ 19,160 | |
United Kingdom | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 259,235 | ||
U.K. foreign tax credits | 20,058 | ||
Ireland | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 9,032 | ||
Australia | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 39,981 | ||
Hong Kong | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 23,203 | ||
United States | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | [1] | 29,508 | |
Operating loss carryforward, portion subject to utilization limits | 7,600 | ||
Operating loss carryforward, annual utilization limit | $ 600 | ||
[1] | On January 30, 2014, the Company’s U.S. mortgage operations underwent an ownership change for U.S. federal income tax purposes as a result of the Company’s acquisition of the CMG Entities. As a result of this ownership change, a limitation has been imposed upon the utilization of approximately $7.6 million of the Company’s existing U.S. net operating loss carryforwards. Utilization is limited to approximately $0.6 million per year in accordance with Section 382 of the Internal Revenue Code of 1986 as amended (“the Code”). |
Income Taxes - Unrecognized tax
Income Taxes - Unrecognized tax benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of beginning and ending amount of unrecognized tax benefits | ||
Balance at beginning of year | $ 2,008 | $ 2,008 |
Additions based on tax positions related to the current year | 0 | 0 |
Additions for tax positions of prior years | 0 | 0 |
Reductions for tax positions of prior years | 0 | 0 |
Settlements | 0 | 0 |
Balance at end of year | $ 2,008 | $ 2,008 |
Income Taxes - Summary of open
Income Taxes - Summary of open tax years by major jurisdiction (Details) | 12 Months Ended |
Dec. 31, 2021 | |
United States | Minimum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2015 |
United States | Maximum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2021 |
United Kingdom | Minimum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2020 |
United Kingdom | Maximum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2021 |
Ireland | Minimum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2017 |
Ireland | Maximum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2021 |
Canada | Minimum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2017 |
Canada | Maximum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2021 |
Switzerland | Minimum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2018 |
Switzerland | Maximum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2021 |
Denmark | Minimum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2017 |
Denmark | Maximum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2021 |
Australia | Minimum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2017 |
Australia | Maximum | |
Income Tax Contingency [Line Items] | |
Open tax year | 2021 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Operating Loss Carryforwards [Line Items] | ||
Current income taxes payable | $ 14.8 | |
Other assets | T&L Bonds | ||
Operating Loss Carryforwards [Line Items] | ||
US mortgage guaranty tax and loss bonds | $ 31.6 | $ 88.1 |
Transactions with Related Par_2
Transactions with Related Parties (Details) | 12 Months Ended | ||||
Dec. 31, 2021USD ($)director | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Jul. 01, 2021 | Dec. 31, 2018USD ($) | |
Related Party Transaction [Line Items] | |||||
Purchases of other investments | $ 1,859,096,000 | $ 1,808,727,000 | $ 1,470,545,000 | ||
Net reserves | 12,157,925,000 | 12,199,074,000 | 9,809,192,000 | $ 9,039,006,000 | |
Reinsurance recoverable for paid and unpaid claims and claims adjustments | 5,880,735,000 | 4,500,802,000 | 4,346,816,000 | ||
Ceded premiums written | 3,734,150,000 | 2,650,352,000 | $ 2,099,893,000 | ||
Reinsurance balances payable | $ 1,583,253,000 | 683,263,000 | |||
Greysbridge Holdings Ltd | |||||
Related Party Transaction [Line Items] | |||||
Percentage ownership | 40.00% | ||||
Premia Holdings Ltd | |||||
Related Party Transaction [Line Items] | |||||
Number of directors | director | 7 | ||||
Greysbridge Holdings Ltd | Kelso And Company | |||||
Related Party Transaction [Line Items] | |||||
Percentage ownership | 30.00% | ||||
Greysbridge Holdings Ltd | Warburg Pincus | |||||
Related Party Transaction [Line Items] | |||||
Percentage ownership | 30.00% | ||||
Arch Re Bermuda And Affiliates | Premia Holdings Ltd | |||||
Related Party Transaction [Line Items] | |||||
Number of directors | director | 2 | ||||
Equity Method Investee | Premia Holdings Ltd | |||||
Related Party Transaction [Line Items] | |||||
Percentage ownership | 25.00% | ||||
Purchases of other investments | $ 100,000,000 | ||||
Equity Method Investee | Barbican | |||||
Related Party Transaction [Line Items] | |||||
Net reserves | $ 380,000,000 | ||||
Reinsurance recoverable for paid and unpaid claims and claims adjustments | 0 | 199,800,000 | |||
Funds held liability | 0 | $ 149,600,000 | |||
Equity Method Investee | Somers Holdings Ltd. | |||||
Related Party Transaction [Line Items] | |||||
Reinsurance recoverable for paid and unpaid claims and claims adjustments | 902,800,000 | ||||
Ceded premiums written | 453,900,000 | ||||
Reinsurance balances payable | 258,400,000 | ||||
Senior notes | $ 35,000,000 | ||||
Preferred shares, dividend rate (as a percent) | 6.50% | ||||
Percentage ownership of affiliate preferred shares | 6.60% |
Leases - Additional information
Leases - Additional information regarding leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Lessee, Lease, Description [Line Items] | ||||
Operating lease costs | $ 31,691 | $ 31,826 | $ 30,500 | |
Cash payments included in the measurement of lease liabilities reported in operating cash flows | 32,094 | 30,365 | ||
Right-of-use assets obtained in exchange for new lease liabilities | 22,686 | $ 12,060 | ||
Operating lease liability | $ 126,711 | |||
Weighted average discount rate | 3.90% | 3.90% | ||
Weighted average remaining lease term | 5 years 10 months 24 days | 5 years 9 months 18 days | ||
Balance sheet location of right of use asset | Other assets | |||
Balance sheet location of operating lease liability | Other liabilities | |||
Other assets | ||||
Lessee, Lease, Description [Line Items] | ||||
Right-of-use assets | [1] | $ 106,836 | $ 115,911 | |
Other liabilities | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease liability | [1] | $ 126,711 | $ 136,015 | |
Maximum | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease term | 11 years | |||
[1] | The right-of-use assets are included in ‘ other assets |
Leases - Contractual maturities
Leases - Contractual maturities (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Contractual maturities of operating lease liabilities | |
2022 | $ 31,682 |
2023 | 25,288 |
2024 | 22,102 |
2025 | 16,253 |
2026 | 13,430 |
2027 and thereafter | 34,173 |
Total undiscounted lease liability | 142,928 |
Less: present value adjustment | (16,217) |
Operating lease liability | $ 126,711 |
Commitments and Contingencies -
Commitments and Contingencies - Concentrations of credit risk (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Customer concentration risk | Gross written premiums | |||
Concentration Risk [Line Items] | |||
Concentration risk, threshold | 10.00% | ||
Customer concentration risk | Gross written premiums | Marsh & McLennan Companies and its subsidiaries | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 18.30% | 13.30% | 9.60% |
Customer concentration risk | Gross written premiums | AON Corporation and its subsidiaries | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 12.20% | 12.00% | 12.20% |
Credit concentration risk | Shareholders' equity | |||
Concentration Risk [Line Items] | |||
Concentration risk, threshold | 10.00% |
Commitments and Contingencies_2
Commitments and Contingencies - Other commitments (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Commitments and Contingencies Disclosure [Abstract] | ||
Investment commitments | $ 3,000 | $ 2,100 |
Estimated purchase commitments, primarily related to software and computerized systems | $ 114.1 | $ 73 |
Debt and Financing Arrangemen_3
Debt and Financing Arrangements - Schedule of senior notes outstanding (Details) - USD ($) $ in Thousands | Jul. 02, 2019 | Dec. 31, 2021 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | ||||
Carrying amount | $ 2,724,394 | $ 2,861,113 | ||
Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Principal amount | 2,750,000 | |||
Carrying amount | $ 2,724,394 | 2,861,113 | ||
Senior Notes | 7.350% senior notes due 2034 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (percentage) | [1] | 7.35% | ||
Principal amount | [1] | $ 300,000 | ||
Carrying amount | $ 297,488 | 297,367 | ||
Senior Notes | 5.144% senior notes due 2043 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (percentage) | [2] | 5.144% | ||
Principal amount | [2] | $ 500,000 | ||
Carrying amount | $ 495,063 | 494,944 | ||
Senior Notes | 4.011% senior notes due 2026 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (percentage) | [3] | 4.011% | ||
Principal amount | [3] | $ 500,000 | ||
Carrying amount | $ 497,633 | 497,211 | ||
Senior Notes | 5.031% senior notes due 2046 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (percentage) | [4] | 5.031% | ||
Principal amount | $ 450,000 | |||
Carrying amount | $ 445,490 | 445,402 | ||
Senior Notes | 3.635% senior notes due 2050 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (percentage) | [5] | 3.635% | ||
Principal amount | $ 1,000,000 | |||
Carrying amount | $ 988,720 | 988,500 | ||
Senior Notes | Somers Notes | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (percentage) | [6] | |||
Principal amount | ||||
Carrying amount | 137,689 | |||
Somers Holdings Ltd. | Variable Interest Entity, Primary Beneficiary | ||||
Debt Instrument [Line Items] | ||||
Carrying amount | $ 172,689 | |||
Somers Holdings Ltd. | Variable Interest Entity, Primary Beneficiary | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Purchase of senior notes | $ 35,000 | |||
[1] | Senior notes of Arch Capital issued on May 4, 2004 and due May 1, 2034 (“2034 notes”). | |||
[2] | Senior notes of Arch-U.S., a wholly-owned subsidiary of Arch Capital, issued on December 13, 2013 and due November 1, 2043 (“2043 notes”), fully and unconditionally guaranteed by Arch Capital. | |||
[3] | Senior notes of Arch Capital Finance LLC (“Arch Finance”), a wholly-owned finance subsidiary of Arch Capital, issued on December 8, 2016 and due December 15, 2026 (“2026 notes”), fully and unconditionally guaranteed by Arch Capital. | |||
[4] | Senior notes of Arch Finance issued on December 8, 2016 and due December 15, 2046 (“2046 notes”), fully and unconditionally guaranteed by Arch Capital | |||
[5] | Senior notes of Arch Capital issued on June 30, 2020 and due June 30, 2050 (“2050 notes”). | |||
[6] | Senior notes of Somers issued on July 2, 2019 and due July 2, 2029 (“Somers Senior Notes”), reflecting the elimination of amounts owned by Arch-U.S. Effective July 1, 2021, the Company no longer consolidates Somers in its financials. |
Debt and Financing Arrangemen_4
Debt and Financing Arrangements - Letter of Credit and Revolving Credit Facilities (Details) - USD ($) $ in Thousands | Dec. 17, 2019 | Dec. 31, 2021 | Dec. 31, 2020 |
Line of Credit Facility [Line Items] | |||
Outstanding borrowings | $ 0 | $ 155,687 | |
Investments pledged as collateral | 348,400 | ||
Advances from Federal Home Loan Banks | 80,000 | 80,000 | |
Investments pledged as security for FHLB advances | 80,200 | 80,200 | |
Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 750,000 | ||
Credit facility term | 5 years | ||
Secured letter of credit facility | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 250,000 | ||
Optional increased capacity | 1,300,000 | ||
Remaining capacity | 9,600 | ||
Outstanding borrowings | 240,400 | ||
Unsecured revolving loan and letter of credit facility | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 500,000 | ||
Arch Re US | Revolving Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Outstanding borrowings | 0 | 0 | |
Other Arch Capital Subsidiaries | Secured letter of credit facility | |||
Line of Credit Facility [Line Items] | |||
Outstanding borrowings | 26,000 | ||
Other Arch Capital Subsidiaries | Unsecured revolving loan and letter of credit facility | |||
Line of Credit Facility [Line Items] | |||
Outstanding borrowings | $ 290,000 | ||
Somers Holdings Ltd. | Secured credit facility expiring November 2021 | |||
Line of Credit Facility [Line Items] | |||
Outstanding borrowings | $ 155,687 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Analysis of goodwill and intangible assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Goodwill | ||||
Goodwill, beginning of year | $ 314,629 | $ 326,551 | ||
Goodwill, acquisitions | 31,677 | [1] | 0 | |
Goodwill, foreign currency translation adjustment | (1,441) | (11,922) | ||
Goodwill, end of year | 344,865 | 314,629 | $ 326,551 | |
Intangible assets (indefinite life) | ||||
Intangible assets with an indefinite life, beginning of year | 79,219 | 85,911 | ||
Intangible assets with an indefinite life, acquisitions | 0 | [1] | 0 | |
Indefinite lived intangible assets, impact of deconsolidation of Somers | (7,650) | |||
Intangible assets with an indefinite life, foreign currency translation adjustment | (212) | (6,692) | ||
Intangible assets with an indefinite life, end of year | 71,357 | 79,219 | 85,911 | |
Intangible assets (finite life) | ||||
Intangible assets with a finite life, beginning of year | 299,015 | 325,621 | ||
Intangible assets with a finite life, acquisitions | 318,459 | [1] | 39,178 | |
Intangible assets with a finite life, amortization | (82,955) | (69,031) | (82,104) | |
Intangible assets with a finite life, foreign currency translation adjustment | (5,758) | 3,247 | ||
Intangible assets with a finite life, end of year | 528,761 | 299,015 | 325,621 | |
Total | ||||
Goodwill and intangible assets, beginning of year | 692,863 | 738,083 | ||
Goodwill and intangible assets, acquisitions | 350,136 | [1] | 39,178 | |
Indefinite Lived and Finite Lived Intangible Assets Decrease Due To Deconsolidation | (7,650) | |||
Goodwill and intangible assets, foreign currency movements and other adjustments | (7,411) | (15,367) | ||
Goodwill and intangible assets, end of year | 944,983 | 692,863 | 738,083 | |
Goodwill and intangible assets, gross balance | 1,515,386 | |||
Intangible assets with a finite life, accumulated amortization | (571,839) | (489,828) | ||
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 1,436 | 1,831 | ||
Goodwill and intangible assets | 944,983 | 692,863 | $ 738,083 | |
Goodwill | ||||
Goodwill | ||||
Goodwill, end of year | 344,865 | |||
Total | ||||
Goodwill, gross balance | 342,842 | |||
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 2,023 | $ (3,414) | ||
Intangible assets with an indefinite life | ||||
Intangible assets (indefinite life) | ||||
Intangible assets with an indefinite life, end of year | 71,357 | |||
Total | ||||
Indefinite-lived intangible assets, gross balance | 70,246 | |||
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 1,111 | |||
Intangible assets with a finite life | ||||
Intangible assets (finite life) | ||||
Intangible assets with a finite life, end of year | 528,761 | |||
Total | ||||
Intangible assets with a finite life, gross balance | 1,102,298 | |||
Intangible assets with a finite life, accumulated amortization | (571,839) | |||
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | $ (1,698) | |||
[1] | Certain amounts for the Company’s 2021 acquisitions are considered provisional. |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Summary of intangible assets by major class (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Schedule of Goodwill And Intangible Assets [Line Items] | ||
Gross balance | $ 1,515,386 | $ 1,180,860 |
Intangible assets with a finite life, accumulated amortization | (571,839) | (489,828) |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 1,436 | 1,831 |
Goodwill and intangible assets | 944,983 | 692,863 |
Intangible liability - unfavorable service contract | ||
Schedule of Goodwill And Intangible Assets [Line Items] | ||
Gross balance | (9,533) | (9,533) |
Intangible assets with a finite life, accumulated amortization | 9,435 | 9,147 |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 0 | 0 |
Goodwill and intangible assets | (98) | (386) |
Intangible assets with a finite life | ||
Schedule of Goodwill And Intangible Assets [Line Items] | ||
Intangible assets with a finite life, accumulated amortization | (571,839) | |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | (1,698) | |
Intangible assets with a finite life | Acquired insurance contracts | ||
Schedule of Goodwill And Intangible Assets [Line Items] | ||
Gross balance | 451,505 | 451,505 |
Intangible assets with a finite life, accumulated amortization | (409,592) | (381,349) |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 339 | 284 |
Goodwill and intangible assets | 42,252 | 70,440 |
Intangible assets with a finite life | Operating platform | ||
Schedule of Goodwill And Intangible Assets [Line Items] | ||
Gross balance | 52,674 | 52,674 |
Intangible assets with a finite life, accumulated amortization | (48,838) | (44,347) |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 56 | 60 |
Goodwill and intangible assets | 3,892 | 8,387 |
Intangible assets with a finite life | Distribution relationships | ||
Schedule of Goodwill And Intangible Assets [Line Items] | ||
Gross balance | 602,518 | 285,141 |
Intangible assets with a finite life, accumulated amortization | (120,302) | (71,383) |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | (2,207) | 3,450 |
Goodwill and intangible assets | 480,009 | 217,208 |
Intangible assets with a finite life | Other | ||
Schedule of Goodwill And Intangible Assets [Line Items] | ||
Gross balance | 5,134 | 5,134 |
Intangible assets with a finite life, accumulated amortization | (2,542) | (1,896) |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 114 | 127 |
Goodwill and intangible assets | 2,706 | 3,365 |
Goodwill | ||
Schedule of Goodwill And Intangible Assets [Line Items] | ||
Gross balance | 342,842 | 318,043 |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 2,023 | (3,414) |
Goodwill and intangible assets | 344,865 | 314,629 |
Intangible assets with an indefinite life | ||
Schedule of Goodwill And Intangible Assets [Line Items] | ||
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 1,111 | |
Intangible assets with an indefinite life | Insurance licenses | ||
Schedule of Goodwill And Intangible Assets [Line Items] | ||
Gross balance | 48,331 | 55,981 |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 0 | 0 |
Goodwill and intangible assets | 48,331 | 55,981 |
Intangible assets with an indefinite life | Syndicate capacity | ||
Schedule of Goodwill And Intangible Assets [Line Items] | ||
Gross balance | 21,915 | 21,915 |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 1,111 | 1,324 |
Goodwill and intangible assets | $ 23,026 | $ 23,239 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Future amortization expense (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
2022 | $ 109,144 | ||
2023 | 99,620 | ||
2024 | 79,410 | ||
2025 | 44,523 | ||
2026 | 35,252 | ||
2027 and thereafter | 160,812 | ||
Finite-Lived Intangible Assets, Net | $ 528,761 | $ 299,015 | $ 325,621 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Narrative (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Remaining useful lives of intangible assets | 1 year |
Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Remaining useful lives of intangible assets | 15 years |
Shareholders' Equity - Roll-for
Shareholders' Equity - Roll-forward of changes in issued and outstanding common shares (Details) - $ / shares | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Common Shares: | ||||
Shares issued, beginning of year | 579,000,841 | 574,617,195 | 570,737,283 | |
Shares issued | [1] | 2,669,229 | 2,646,164 | 2,835,994 |
Restricted shares issued, net of cancellations | 1,619,780 | 1,737,482 | 1,043,918 | |
Shares issued, end of year | 583,289,850 | 579,000,841 | 574,617,195 | |
Common shares held in treasury, end of year | (204,365,956) | (172,280,199) | (168,997,994) | |
Common shares outstanding, end of year | 378,923,894 | 406,720,642 | 405,619,201 | |
Authorized and Issued: | ||||
Common shares authorized | 1,800,000,000 | |||
Common shares, par value per share | $ 0.0011 | $ 0.0011 | ||
Preferred shares authorized | 50,000,000 | |||
Preferred shares, par value per share | $ 0.01 | |||
[1] | Includes shares issued from the exercise of stock options and stock appreciation rights, the vesting of restricted share units and shares issued from the employee share purchase plan. |
Shareholders' Equity - Share re
Shareholders' Equity - Share repurchase program (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Class of Stock [Line Items] | |||
Aggregate cost of shares repurchased | $ 1,234,294 | $ 83,472 | $ 2,871 |
Number of shares repurchased (shares) | 31,486,830 | 2,850,102 | 110,598 |
Average price per share repurchased | $ 39.20 | $ 29.29 | $ 25.96 |
Common shares held in treasury (shares) | 204,365,956 | 172,280,199 | 168,997,994 |
Common shares held in treasury, at cost | $ 3,761,095 | $ 2,503,909 | |
Common shares | |||
Class of Stock [Line Items] | |||
Remaining share repurchase authorization | $ 1,200,000 | ||
Cumulative number of shares acquired since inception of share repurchase program | 420,700,000 | ||
Aggregate purchase price of shares acquired since inception of share repurchase program | $ 5,300,000 |
Shareholders' Equity - Preferre
Shareholders' Equity - Preferred shares (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | Jan. 01, 2018 | Jun. 30, 2021 | Nov. 30, 2017 | Aug. 31, 2017 | Nov. 30, 2017 | Dec. 31, 2021 |
Class of Stock [Line Items] | ||||||
Preferred shares, par value per share | $ 0.01 | |||||
Series C Preferred Shares | ||||||
Class of Stock [Line Items] | ||||||
Preferred shares, dividend rate (as a percent) | 6.75% | |||||
Series E preferred shares | ||||||
Class of Stock [Line Items] | ||||||
Preferred shares, dividend rate (as a percent) | 5.25% | |||||
Preferred shares, redemption price per share | $ 25 | |||||
Series F Preferred Shares | ||||||
Class of Stock [Line Items] | ||||||
Preferred shares issued | $ 100 | $ 230 | $ 330 | |||
Preferred shares, dividend rate (as a percent) | 5.45% | |||||
Preferred shares, par value per share | $ 0.01 | $ 0.01 | ||||
Liquidation preference per share | 25,000 | 25,000 | ||||
Preferred shares, redemption price per share | $ 25,000 | $ 25,000 | ||||
Series F depositary share equivalent | ||||||
Class of Stock [Line Items] | ||||||
Preference shares, number of shares issued | 13.2 | 13.2 | ||||
Proportionate interest of preference shares, per depositary share | 0.10% | 0.10% | ||||
Liquidation preference per share | $ 25 | $ 25 | ||||
Preferred shares, redemption price per share | $ 25 | $ 25 | ||||
Series G Preferred Stock | ||||||
Class of Stock [Line Items] | ||||||
Preferred shares issued | $ 500 | |||||
Preferred shares, dividend rate (as a percent) | 4.55% | |||||
Preferred shares, par value per share | $ 0.01 | |||||
Liquidation preference per share | 25,000 | |||||
Preferred shares, redemption price per share | $ 25,000 | |||||
Series G depositary share equivalent | ||||||
Class of Stock [Line Items] | ||||||
Preference shares, number of shares issued | 20 | |||||
Proportionate interest of preference shares, per depositary share | 0.10% | |||||
Liquidation preference per share | $ 25 | |||||
Preferred shares, redemption price per share | $ 25 |
Share-Based Compensation - Long
Share-Based Compensation - Long Term Incentive Plan (Details) - shares | 12 Months Ended | |
Dec. 31, 2021 | May 06, 2016 | |
2018 Long Term Incentive and Share Award Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares reserved for issuance | 34,500,000 | |
Shares available for issuance transferred | 9,909,950 | |
2015 Long Term Incentive And Share Award Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares reserved for issuance | 12,900,000 | |
Shares available for issuance | 606,942 | |
2012 Long Term Incentive and Share Award Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total number of shares reserved under plan | 22,301,772 | |
Shares available for issuance | 320,272 | |
2007 Employee Share Purchase Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares available for issuance | 1,608,354 | 4,689,777 |
Share-Based Compensation - Valu
Share-Based Compensation - Valuation assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |||
Dividend yield | 0.00% | 0.00% | 0.00% |
Expected volatility | 24.20% | 16.60% | 18.10% |
Risk free interest rate | 1.00% | 1.20% | 2.50% |
Expected option life | 6 years | 6 years | 6 years |
Share-Based Compensation - Stoc
Share-Based Compensation - Stock option activity (Details) - Stock Options $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($)$ / sharesshares | |
Number of Options / SARs | |
Outstanding, beginning of year (in shares) | shares | 17,839,333 |
Granted (in shares) | shares | 1,243,984 |
Exercised (in shares) | shares | (1,931,320) |
Forfeited or expired (in shares) | shares | (68,837) |
Outstanding, end of year (in shares) | shares | 17,083,160 |
Exercisable, end of year (in shares) | shares | 14,730,147 |
Weighted Average Exercise Price | |
Outstanding, beginning of year, weighted average exercise price | $ / shares | $ 23.32 |
Granted, weighted average exercise price | $ / shares | 35.90 |
Exercised, weighted average exercise price | $ / shares | 15.57 |
Forfeited or expired, weighted average exercise price | $ / shares | 35.39 |
Outstanding, end of year, weighted average exercise price | $ / shares | 25.06 |
Exercisable, end of year, weighted average exercise price | $ / shares | $ 23.20 |
Weighted average contractual term, outstanding, end of year | 4 years 4 months 28 days |
Weighted average contractual term, exercisable, end of year | 3 years 9 months 10 days |
Aggregate intrinsic value, outstanding, end of year | $ | $ 331,214 |
Aggregate intrinsic value, exercisable, end of year | $ | $ 312,966 |
Share-Based Compensation - Opti
Share-Based Compensation - Options additional information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Options and SARs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Proceeds from stock options exercised | $ 10,100 | ||
Tax benefit from exercise of stock options and SARs | $ 5,400 | ||
Weighted average grant date fair value | $ 9.22 | $ 8.14 | $ 7.90 |
Aggregate intrinsic value of options exercised | $ 47,074 | $ 59,723 | $ 51,350 |
Share-Based Compensation - Rest
Share-Based Compensation - Restricted common shares and restricted stock units activity (Details) | 12 Months Ended |
Dec. 31, 2021$ / sharesshares | |
Restricted Common Shares | |
Unvested Shares: | |
Unvested balance, beginning of year (in shares) | shares | 1,635,845 |
Restricted shares and restricted unit awards granted | shares | 1,085,811 |
Vested (in shares) | shares | (549,892) |
Forfeited (in shares) | shares | (100,927) |
Unvested balance, end of year (in shares) | shares | 2,070,837 |
Weighted Average Grant Date Fair Value: | |
Unvested balance, beginning of year, weighted average grant date fair value | $ / shares | $ 36.34 |
Weighted average grant date fair value | $ / shares | 36.14 |
Vested, weighted average grant date fair value | $ / shares | 35.94 |
Forfeited, weighted average grant date fair value | $ / shares | 36.28 |
Unvested balance, end of year, weighted average grant date fair value | $ / shares | $ 36.35 |
Restricted Unit Awards | |
Unvested Shares: | |
Unvested balance, beginning of year (in shares) | shares | 1,121,719 |
Restricted shares and restricted unit awards granted | shares | 175,962 |
Vested (in shares) | shares | (555,870) |
Forfeited (in shares) | shares | (41,945) |
Unvested balance, end of year (in shares) | shares | 699,866 |
Weighted Average Grant Date Fair Value: | |
Unvested balance, beginning of year, weighted average grant date fair value | $ / shares | $ 31.43 |
Weighted average grant date fair value | $ / shares | 35.94 |
Vested, weighted average grant date fair value | $ / shares | 30.46 |
Forfeited, weighted average grant date fair value | $ / shares | 32.23 |
Unvested balance, end of year, weighted average grant date fair value | $ / shares | $ 33.29 |
Share-Based Compensation - Re_2
Share-Based Compensation - Restricted stock additional information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Restricted Common Shares And Restricted Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Restricted shares and restricted unit awards granted | 1,261,773 | 1,535,330 | 1,195,741 |
Weighted average grant date fair value | $ 36.12 | $ 37.55 | $ 32.89 |
Aggregate fair value of vested restricted share and unit awards | $ 65,477 | $ 39,703 | $ 46,262 |
Aggregate intrinsic value of restricted units outstanding | $ 31,100 |
Share-Based Compensation - Perf
Share-Based Compensation - Performance shares and performance units activity (Details) | 12 Months Ended | |
Dec. 31, 2021$ / sharesshares | ||
Performance Shares | ||
Unvested Shares: | ||
Unvested balance, beginning of year (in shares) | shares | 1,851,382 | |
Performance shares and units granted | shares | 674,406 | |
Share Based Compensation, Performance Adjustment | shares | (39,510) | [1],[2] |
Vested (in shares) | shares | (624,518) | |
Unvested balance, end of year (in shares) | shares | 1,861,760 | |
Weighted Average Grant Date Fair Value: | ||
Unvested balance, beginning of year, weighted average grant date fair value | $ / shares | $ 34.42 | |
Weighted average grant date fair value | $ / shares | 37.38 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Performance Adjustment, Weighted Average Grant Date Fair Value | $ / shares | 24.78 | [1],[2] |
Vested, weighted average grant date fair value | $ / shares | 24.78 | |
Unvested balance, end of year, weighted average grant date fair value | $ / shares | $ 38.93 | |
Performance Units | ||
Unvested Shares: | ||
Unvested balance, beginning of year (in shares) | shares | 32,065 | |
Performance shares and units granted | shares | 10,698 | |
Share Based Compensation, Performance Adjustment | shares | 11,447 | [1],[2] |
Vested (in shares) | shares | (24,440) | |
Unvested balance, end of year (in shares) | shares | 29,770 | |
Weighted Average Grant Date Fair Value: | ||
Unvested balance, beginning of year, weighted average grant date fair value | $ / shares | $ 33.48 | |
Weighted average grant date fair value | $ / shares | 37.38 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Performance Adjustment, Weighted Average Grant Date Fair Value | $ / shares | 24.71 | [1],[2] |
Vested, weighted average grant date fair value | $ / shares | 24.71 | |
Unvested balance, end of year, weighted average grant date fair value | $ / shares | $ 38.71 | |
[1] | The performance adjustment represents the change in PSUs, which vested following the end of the performance period. The performance units were granted at the target level of achievement | |
[2] | The performance adjustment represents the difference between the number of performance shares granted and earned, which vested following the end of the performance period. The performance shares were granted at the maximum level of achievement. |
Share-Based Compensation - Pe_2
Share-Based Compensation - Performance shares and units additional information (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Expected volatility | 24.20% | 16.60% | 18.10% |
Risk free interest rate | 1.00% | 1.20% | 2.50% |
Performance Common Shares and Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Expected volatility | 37.50% | 18.10% | 17.10% |
Risk free interest rate | 0.30% | 1.10% | 2.50% |
Performance shares and units granted | 685,104 | 557,204 | 696,360 |
Weighted average grant date fair value | $ 37.38 | $ 44.17 | $ 36.05 |
Performance Common Shares and Units | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Payout percentage | 0.00% | ||
Performance Common Shares and Units | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Payout percentage | 200.00% |
Share-Based Compensation - Shar
Share-Based Compensation - Share-based compensation expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation expense | $ 86,580 | $ 69,892 | $ 63,848 |
Share based compensation expense, net of tax | 75,667 | 60,345 | 55,502 |
Options and SARs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation expense | 12,316 | 11,744 | 12,866 |
Share based compensation expense, net of tax | 10,927 | 10,388 | 11,450 |
Restricted Common Shares And Restricted Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation expense | 46,817 | 41,284 | 38,988 |
Share based compensation expense, net of tax | 39,349 | 34,599 | 32,999 |
Performance Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation expense | 23,696 | 14,729 | 8,949 |
Share based compensation expense, net of tax | 21,920 | 13,380 | 8,295 |
Employee Share Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation expense | 3,751 | 2,135 | 3,045 |
Share based compensation expense, net of tax | $ 3,471 | $ 1,978 | $ 2,758 |
Share-Based Compensation - Unre
Share-Based Compensation - Unrecognized compensation cost and period for recognition (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation cost related to unvested awards | $ 8,233 |
Weighted average recognition period (years) | 10 months 28 days |
Restricted Common Shares And Restricted Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation cost related to unvested awards | $ 45,936 |
Weighted average recognition period (years) | 1 year 2 months 23 days |
Performance Common Shares and Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation cost related to unvested awards | $ 7,635 |
Weighted average recognition period (years) | 6 months 7 days |
Retirement Plans (Details)
Retirement Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |||
Defined contribution plan, expense | $ 60.4 | $ 52 | $ 44.8 |
Statutory Information - Summary
Statutory Information - Summary of statutory capital, surplus and net income (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Bermuda | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | [1] | $ 17,528,510 | $ 17,390,943 | |
Required statutory capital and surplus | [1] | 5,661,301 | 5,234,121 | |
Statutory net income (loss) | 2,370,746 | 1,579,889 | $ 1,801,486 | |
Ireland | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | [1] | 958,200 | 883,337 | |
Required statutory capital and surplus | [1] | 794,933 | 701,161 | |
Statutory net income (loss) | 25,191 | 18,397 | 26,367 | |
United States | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | [1] | 5,600,652 | 4,904,840 | |
Required statutory capital and surplus | [1] | 1,717,646 | 1,644,324 | |
Statutory net income (loss) | 345,790 | 143,271 | 481,188 | |
United Kingdom | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | [1] | 902,002 | 967,440 | |
Required statutory capital and surplus | [1] | 563,164 | 601,662 | |
Statutory net income (loss) | 35,286 | 4,078 | (17,423) | |
Canada | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | [1] | 70,063 | 64,286 | |
Required statutory capital and surplus | [1] | 42,513 | 37,441 | |
Statutory net income (loss) | 6,985 | (1,049) | (1,023) | |
Australia | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | 283,693 | 64,507 | ||
Required statutory capital and surplus | 214,022 | 19,370 | ||
Statutory net income (loss) | $ 11,874 | $ (8,601) | $ (6,199) | |
[1] | Such amounts include ownership interests in affiliated insurance and reinsurance subsidiaries. |
Statutory Information - Narrati
Statutory Information - Narrative (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2021USD ($)subsidiary | |
Ireland | |
Statutory Accounting Practices [Line Items] | |
Number Of Subsidiaries | subsidiary | 3 |
Mortgage | North Carolina or Wisconsin | |
Statutory Accounting Practices [Line Items] | |
Dividend required notice period | 30 days |
Required contingency loss reserve as a percentage of net earned premiums | 50.00% |
Withdrawal restriction period | 10 years |
Withdrawal restriction period, with prior approval | 35.00% |
Maximum risk to capital ratio | 2500.00% |
United Guaranty Residential Insurance Company [Member] | North Carolina | |
Statutory Accounting Practices [Line Items] | |
Dividends available for payment in 2022, total | $ 194.1 |
Arch Re US | United States | |
Statutory Accounting Practices [Line Items] | |
Dividends available for payment in 2022, total | $ 217.5 |
Arch Re Bermuda | Bermuda | |
Statutory Accounting Practices [Line Items] | |
Dividends, percentage permitted | 25.00% |
Dividend required notice period | 7 days |
Dividends available for payment in 2022 without prior regulatory approval | $ 3,800 |
Subsequent Event - (Details)
Subsequent Event - (Details) - USD ($) $ in Thousands | 2 Months Ended | 12 Months Ended | |||
Feb. 25, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2022 | |
Subsequent Event [Line Items] | |||||
Number of shares repurchased (shares) | 31,486,830 | 2,850,102 | 110,598 | ||
Aggregate cost of shares repurchased | $ 1,234,294 | $ 83,472 | $ 2,871 | ||
Common shares | |||||
Subsequent Event [Line Items] | |||||
Remaining share repurchase authorization | 1,200,000 | ||||
Variable Interest Entity, Not Primary Beneficiary | |||||
Subsequent Event [Line Items] | |||||
Initial Coverage at Issuance | $ 6,626,664 | ||||
Subsequent Event | Common shares | |||||
Subsequent Event [Line Items] | |||||
Number of shares repurchased (shares) | 890,180 | ||||
Aggregate cost of shares repurchased | $ 41,500 | ||||
Remaining share repurchase authorization | $ 1,140,000 | ||||
Subsequent Event | Bellemeade Re 2022-1 Ltd | |||||
Subsequent Event [Line Items] | |||||
Pool Of Underlying Mortgages, Amount | $ 6,300,000 | ||||
Subsequent Event | Variable Interest Entity, Not Primary Beneficiary | Bellemeade Re 2022-1 Ltd | |||||
Subsequent Event [Line Items] | |||||
Initial Coverage at Issuance | 315,000 | ||||
Subsequent Event | Variable Interest Entity, Not Primary Beneficiary | Bellemeade Re 2022-1 Ltd | Funded By VIE | |||||
Subsequent Event [Line Items] | |||||
Initial Coverage at Issuance | 283,500 | ||||
Subsequent Event | Variable Interest Entity, Not Primary Beneficiary | Bellemeade Re 2022-1 Ltd | Directly provided capacity | |||||
Subsequent Event [Line Items] | |||||
Initial Coverage at Issuance | $ 33,000 |
Schedule II - Condensed Finan_2
Schedule II - Condensed Financial Information of Registrant - Balance Sheet (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Assets | ||||
Total investments | $ 26,588,156 | $ 28,761,358 | ||
Cash | 858,668 | 906,448 | $ 726,230 | |
Investment in operating affiliates | 1,135,655 | 129,291 | ||
Other assets | 2,453,849 | 1,724,288 | ||
Total assets | 45,100,945 | 43,282,297 | 37,885,361 | |
Liabilities | ||||
Senior notes | 2,724,394 | 2,861,113 | ||
Other liabilities | 1,329,742 | 1,510,888 | ||
Total liabilities | 31,545,816 | 29,294,856 | 25,569,809 | |
Shareholders’ Equity | ||||
Non-cumulative preferred shares | 830,000 | 780,000 | ||
Common shares ($0.0011 par, shares issued: 583,289,850 and 579,000,841) | 648 | 643 | ||
Additional paid-in capital | 2,085,075 | 1,977,794 | ||
Retained earnings | 14,455,868 | 12,362,463 | ||
Accumulated other comprehensive income (loss), net of deferred income tax | (64,600) | 488,895 | 212,091 | $ (178,720) |
Common shares held in treasury, at cost (shares: 204,365,956 and 172,280,199) | (3,761,095) | (2,503,909) | ||
Total shareholders' equity | 13,545,896 | 13,928,893 | $ 12,260,148 | |
Total liabilities, noncontrolling interests and shareholders' equity | $ 45,100,945 | $ 43,282,297 | ||
Parenthetical information: | ||||
Common shares, par value per share | $ 0.0011 | $ 0.0011 | ||
Common shares issued (shares) | 583,289,850 | 579,000,841 | 574,617,195 | 570,737,283 |
Common shares held in treasury (shares) | 204,365,956 | 172,280,199 | 168,997,994 | |
Parent Company | ||||
Assets | ||||
Total investments | $ 2,038 | $ 172 | ||
Cash | 16,317 | 18,932 | ||
Investment in subsidiaries | 14,822,024 | 14,377,529 | ||
Investment in operating affiliates | 6,877 | 7,731 | ||
Due from Affiliates | 11 | 0 | ||
Other assets | 9,604 | 10,659 | ||
Total assets | 14,856,871 | 14,415,023 | ||
Liabilities | ||||
Senior notes | 1,286,208 | 1,285,867 | ||
Due to subsidiaries and affiliates | 0 | 0 | ||
Other liabilities | 24,767 | 23,270 | ||
Total liabilities | 1,310,975 | 1,309,137 | ||
Shareholders’ Equity | ||||
Non-cumulative preferred shares | 830,000 | 780,000 | ||
Common shares ($0.0011 par, shares issued: 583,289,850 and 579,000,841) | 648 | 643 | ||
Additional paid-in capital | 2,085,075 | 1,977,794 | ||
Retained earnings | 14,455,868 | 12,362,463 | ||
Accumulated other comprehensive income (loss), net of deferred income tax | (64,600) | 488,895 | ||
Common shares held in treasury, at cost (shares: 204,365,956 and 172,280,199) | (3,761,095) | (2,503,909) | ||
Total shareholders' equity | 13,545,896 | 13,105,886 | ||
Total liabilities, noncontrolling interests and shareholders' equity | $ 14,856,871 | $ 14,415,023 | ||
Parenthetical information: | ||||
Common shares, par value per share | $ 0.0011 | $ 0.0011 | ||
Common shares issued (shares) | 583,289,850 | 579,000,841 | ||
Common shares held in treasury (shares) | 204,365,956 | 172,280,199 |
Schedule II - Condensed Finan_3
Schedule II - Condensed Financial Information of Registrant - Statement of Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues | |||
Net investment income | $ 389,118 | $ 519,608 | $ 627,738 |
Net realized gains (losses) | 379,845 | 823,460 | 363,198 |
Total revenues | 9,249,980 | 8,508,509 | 6,925,967 |
Expenses | |||
Corporate expenses | 79,157 | 81,988 | 80,111 |
Interest expense | 139,470 | 143,456 | 120,872 |
Net foreign exchange gains (losses) | 41,529 | (83,634) | (20,609) |
Total expenses | 7,146,629 | 6,947,726 | 5,079,090 |
Income (loss) from operating affiliates | 264,693 | 16,766 | 2,233 |
Net income available to Arch | 2,156,849 | 1,405,521 | 1,636,319 |
Preferred share dividends | (48,343) | (41,612) | (41,612) |
Loss on redemption of preferred shares | (15,101) | 0 | 0 |
Net income available to Arch common shareholders | 2,093,405 | 1,363,909 | 1,594,707 |
Parent | |||
Revenues | |||
Net investment income | 1,524 | 53 | 212 |
Net realized gains (losses) | 0 | (2,110) | 0 |
Total revenues | 1,524 | (2,057) | 212 |
Expenses | |||
Corporate expenses | 71,818 | 65,566 | 62,701 |
Interest expense | 58,741 | 40,445 | 22,154 |
Net foreign exchange gains (losses) | 7 | 3 | 1 |
Total expenses | 130,566 | 106,014 | 84,856 |
Income (loss) before income taxes | (129,042) | (108,071) | (84,644) |
Income (loss) from operating affiliates | (590) | (437) | (762) |
Income (loss) before equity in net income of subsidiaries | (129,632) | (108,508) | (85,406) |
Equity in net income of subsidiaries | 2,286,481 | 1,514,029 | 1,721,725 |
Net income available to Arch | 2,156,849 | 1,405,521 | 1,636,319 |
Preferred share dividends | (48,343) | (41,612) | (41,612) |
Loss on redemption of preferred shares | (15,101) | 0 | 0 |
Net income available to Arch common shareholders | $ 2,093,405 | $ 1,363,909 | $ 1,594,707 |
Schedule II - Condensed Finan_4
Schedule II - Condensed Financial Information of Registrant - Statement of Cash Flows (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating Activities: | |||
Net Cash Provided by (Used in) Operating Activities | $ 3,427,555 | $ 2,886,505 | $ 2,048,459 |
Investing Activities: | |||
Net (purchases) sales of short-term investments | 165,272 | (1,029,681) | 39,833 |
Purchases of fixed assets | (41,394) | (39,872) | (37,837) |
Net cash provided by (used for) investing activities | (2,139,732) | (3,043,226) | (1,806,483) |
Financing Activities: | |||
Purchases of common shares under share repurchase program | (1,234,294) | (83,472) | (2,871) |
Proceeds from common shares issued, net | 6,418 | 1,876 | 6,203 |
Proceeds from issuance of preferred shares, net | 485,821 | 0 | 0 |
Redemption of preferred shares | (450,000) | 0 | 0 |
Proceeds from borrowings | 0 | 1,018,793 | 200,083 |
Preferred dividends paid | (48,280) | (41,612) | (41,612) |
Net Cash Provided by (Used in) Financing Activities | (1,229,549) | 521,278 | (80,662) |
Increase (decrease) in cash and restricted cash | 24,227 | 386,846 | 179,055 |
Cash and restricted cash, beginning of year | 1,290,544 | 903,698 | 724,643 |
Cash and restricted cash, end of year | 1,314,771 | 1,290,544 | 903,698 |
Parent | |||
Operating Activities: | |||
Net Cash Provided by (Used in) Operating Activities | 1,727,529 | 124,751 | 52,487 |
Investing Activities: | |||
Net (purchases) sales of short-term investments | (1,866) | (130) | 61 |
Capital contributed to subsidiaries | (487,161) | (988,975) | (2,121) |
Purchases of fixed assets | (783) | (15) | (162) |
Net cash provided by (used for) investing activities | (489,810) | (989,120) | (2,222) |
Financing Activities: | |||
Purchases of common shares under share repurchase program | (1,234,294) | (83,472) | (2,871) |
Proceeds from common shares issued, net | 6,418 | 1,876 | 6,203 |
Proceeds from issuance of preferred shares, net | 485,821 | 0 | 0 |
Redemption of preferred shares | (450,000) | 0 | 0 |
Proceeds from borrowings | 0 | 988,393 | 0 |
Preferred dividends paid | (48,280) | (41,612) | (41,612) |
Net Cash Provided by (Used in) Financing Activities | (1,240,335) | 865,185 | (38,280) |
Increase (decrease) in cash and restricted cash | (2,616) | 816 | 11,985 |
Cash and restricted cash, beginning of year | 18,960 | 18,144 | 6,159 |
Cash and restricted cash, end of year | $ 16,344 | $ 18,960 | $ 18,144 |
Schedule III - Supplementary _2
Schedule III - Supplementary Insurance Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | ||||
Deferred Acquisition Costs | $ 901,841 | $ 790,708 | $ 633,400 | |
Reserves for Losses and Loss Adjustment Expenses | 17,757,156 | 16,513,928 | 13,891,842 | |
Unearned Premiums | 6,011,942 | 4,838,965 | 4,339,549 | |
Net Premiums Earned | 8,082,298 | 6,991,935 | 5,786,498 | |
Net Losses and Loss Adjustment Expenses Incurred | 4,584,803 | 4,689,599 | 3,133,452 | |
Amortization of Deferred Acquisition Costs | 1,303,178 | 1,004,842 | 840,945 | |
Other Operating Expenses | [1] | 998,595 | 875,176 | 800,997 |
Net Premiums Written | 9,018,337 | 7,437,716 | 6,039,067 | |
Operating segments | Insurance | ||||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | ||||
Deferred Acquisition Costs | 378,265 | 254,833 | 188,684 | |
Reserves for Losses and Loss Adjustment Expenses | 9,810,622 | 8,989,930 | 7,900,328 | |
Unearned Premiums | 2,937,664 | 2,334,225 | 1,991,496 | |
Net Premiums Earned | 3,626,468 | 2,871,420 | 2,397,080 | |
Net Losses and Loss Adjustment Expenses Incurred | 2,344,365 | 2,092,453 | 1,615,475 | |
Amortization of Deferred Acquisition Costs | 606,265 | 418,483 | 361,614 | |
Other Operating Expenses | [1] | 558,906 | 489,153 | 454,770 |
Net Premiums Written | 4,148,193 | 3,162,907 | 2,641,726 | |
Operating segments | Reinsurance | ||||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | ||||
Deferred Acquisition Costs | 424,390 | 278,422 | 197,856 | |
Reserves for Losses and Loss Adjustment Expenses | 6,878,721 | 5,027,742 | 4,270,013 | |
Unearned Premiums | 2,263,264 | 1,356,983 | 971,776 | |
Net Premiums Earned | 2,840,443 | 2,162,229 | 1,466,389 | |
Net Losses and Loss Adjustment Expenses Incurred | 1,924,719 | 1,628,320 | 1,011,329 | |
Amortization of Deferred Acquisition Costs | 536,754 | 354,048 | 239,032 | |
Other Operating Expenses | [1] | 212,810 | 168,011 | 141,484 |
Net Premiums Written | 3,254,374 | 2,457,370 | 1,602,723 | |
Operating segments | Mortgage | ||||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | ||||
Deferred Acquisition Costs | 99,186 | 203,748 | 182,816 | |
Reserves for Losses and Loss Adjustment Expenses | 1,067,813 | 976,673 | 457,872 | |
Unearned Premiums | 811,014 | 740,043 | 937,370 | |
Net Premiums Earned | 1,283,419 | 1,397,935 | 1,366,340 | |
Net Losses and Loss Adjustment Expenses Incurred | 56,677 | 528,344 | 53,513 | |
Amortization of Deferred Acquisition Costs | 97,418 | 134,240 | 134,319 | |
Other Operating Expenses | [1] | 194,010 | 162,202 | 153,092 |
Net Premiums Written | 1,261,068 | 1,279,850 | 1,261,756 | |
Operating segments | Other | ||||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | ||||
Deferred Acquisition Costs | 53,705 | 64,044 | ||
Reserves for Losses and Loss Adjustment Expenses | 1,519,583 | 1,263,629 | ||
Unearned Premiums | 407,714 | 438,907 | ||
Net Premiums Earned | 331,968 | 560,351 | 556,689 | |
Net Losses and Loss Adjustment Expenses Incurred | 259,042 | 440,482 | 453,135 | |
Amortization of Deferred Acquisition Costs | 62,741 | 98,071 | 105,980 | |
Other Operating Expenses | [1] | 32,869 | 55,810 | 51,651 |
Net Premiums Written | $ 354,702 | $ 537,589 | $ 532,862 | |
[1] | Certain other operating expenses relate to the Company’s corporate segment. Such amounts are not reflected in the table above. See note 4, “Segment Information,” to our consolidated financial statements in Item 8 for information related to the corporate segment. |
Schedule IV - Reinsurance (Deta
Schedule IV - Reinsurance (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||||
Gross Amount | $ 7,706,832 | $ 6,553,910 | $ 5,681,523 | |
Ceded to other Companies | (3,734,150) | (2,650,352) | (2,099,893) | |
Assumed From Other Companies | 5,045,655 | 3,534,158 | 2,457,437 | |
Net Amount | $ 9,018,337 | $ 7,437,716 | $ 6,039,067 | |
Percentage of Amount Assumed to Net | 55.90% | 47.50% | 40.70% | |
Operating segments | Insurance | ||||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||||
Gross Amount | $ 5,833,873 | $ 4,659,416 | $ 3,879,752 | |
Ceded to other Companies | [1] | (1,719,541) | (1,525,655) | (1,266,267) |
Assumed From Other Companies | [1] | 33,861 | 29,146 | 28,241 |
Net Amount | $ 4,148,193 | $ 3,162,907 | $ 2,641,726 | |
Percentage of Amount Assumed to Net | 0.80% | 0.90% | 1.10% | |
Operating segments | Reinsurance | ||||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||||
Gross Amount | $ 408,520 | $ 305,435 | $ 238,229 | |
Ceded to other Companies | [1] | (1,839,556) | (1,014,716) | (720,500) |
Assumed From Other Companies | [1] | 4,685,410 | 3,166,651 | 2,084,994 |
Net Amount | $ 3,254,374 | $ 2,457,370 | $ 1,602,723 | |
Percentage of Amount Assumed to Net | 144.00% | 128.90% | 130.10% | |
Operating segments | Mortgage | ||||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||||
Gross Amount | $ 1,213,333 | $ 1,192,316 | $ 1,224,373 | |
Ceded to other Companies | [1] | (246,757) | (194,149) | (204,509) |
Assumed From Other Companies | [1] | 294,492 | 281,683 | 241,892 |
Net Amount | $ 1,261,068 | $ 1,279,850 | $ 1,261,756 | |
Percentage of Amount Assumed to Net | 23.40% | 22.00% | 19.20% | |
Operating segments | Other | ||||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||||
Gross Amount | $ 251,106 | $ 396,743 | $ 339,169 | |
Ceded to other Companies | [1] | (102,763) | (190,957) | (222,019) |
Assumed From Other Companies | [1] | 206,359 | 331,803 | 415,712 |
Net Amount | $ 354,702 | $ 537,589 | $ 532,862 | |
Percentage of Amount Assumed to Net | 58.20% | 61.70% | 78.00% | |
[1] | Certain amounts included in the gross premiums written of each segment are related to intersegment transactions and are included in the gross premiums written of each segment. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total. |
Schedule VI - Supplementary I_2
Schedule VI - Supplementary Information For Property and Casualty Insurance Underwriters (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
SEC Schedule, 12-18, Supplemental Information, Property-Casualty Insurance Underwriters [Line Items] | |||
Net Losses and Loss Adjustment Expenses Incurred Related to Current Year | $ 4,940,987 | $ 4,851,051 | $ 3,297,037 |
Net Losses and Loss Adjustment Expenses Incurred Related to Prior Years | (356,184) | (161,452) | (163,585) |
Consolidated Subsidiaries | |||
SEC Schedule, 12-18, Supplemental Information, Property-Casualty Insurance Underwriters [Line Items] | |||
Deferred Acquisition Costs | 901,841 | 790,708 | 633,400 |
Reserves for Losses and Loss Adjustment Expenses | 17,757,156 | 16,513,929 | 13,891,842 |
Discount, if any, deducted in Column C | 55,575 | 23,326 | 22,012 |
Unearned Premiums | 6,011,942 | 4,838,965 | 4,339,549 |
Net Premiums Earned | 8,082,298 | 6,991,935 | 5,786,498 |
Net investment income | 389,118 | 519,608 | 627,738 |
Net Losses and Loss Adjustment Expenses Incurred Related to Current Year | 4,940,987 | 4,851,051 | 3,297,037 |
Net Losses and Loss Adjustment Expenses Incurred Related to Prior Years | (356,184) | (161,452) | (163,585) |
Amortization of Deferred Acquisition Costs | 1,303,178 | 1,004,842 | 840,945 |
Net Paid Losses and Loss Adjustment Expenses | 2,826,551 | 2,661,117 | 2,383,255 |
Net Premiums Written | $ 9,018,337 | $ 7,437,716 | $ 6,039,067 |