Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2023 | Feb. 16, 2024 | Jun. 30, 2023 | |
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, 2023 | ||
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 | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 26.9 | ||
Entity Common Stock, Shares Outstanding | 374,151,215 | ||
Documents Incorporated by Reference | Portions of Part III and Part IV incorporate by reference our definitive proxy statement for the 2024 annual meeting of shareholders to be filed with the Securities and Exchange Commission pursuant to Regulation 14A within 120 days after December 31, 2023. | ||
Entity Central Index Key | 0000947484 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Common shares | |||
Entity Listings [Line Items] | |||
Title of 12(b) Security | Common Shares, $0.0011 par value per share | ||
Trading Symbol | ACGL | ||
Security Exchange Name | NASDAQ | ||
Series F depositary share equivalent | |||
Entity Listings [Line Items] | |||
Title of 12(b) Security | Depositary shares, each representing a 1/1,000th interest in a 5.45% Series F preferred share | ||
Trading Symbol | ACGLO | ||
Security Exchange Name | NASDAQ | ||
Series G depositary share equivalent | |||
Entity Listings [Line Items] | |||
Title of 12(b) Security | Depositary shares, each representing a 1/1,000th interest in a 4.55% Series G preferred share | ||
Trading Symbol | ACGLN | ||
Security Exchange Name | NASDAQ |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Audit Information [Abstract] | |
Auditor Name | PricewaterhouseCoopers LLP |
Auditor Location | New York, New York |
Auditor Firm ID | 238 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Investments: | ||
Debt securities available for sale, at fair value | $ 25,616 | $ 21,015 |
Equity securities, at fair value | 1,186 | 860 |
Other investments (portion measured at fair value: $2,488 and $1,644) | 2,488 | 1,644 |
Investments accounted for using the equity method | 4,566 | 3,774 |
Total investments | 33,856 | 27,293 |
Cash | 917 | 855 |
Accrued investment income | 236 | 159 |
Investment in operating affiliates | 1,119 | 965 |
Premiums receivable (net of allowance for credit losses: $34 and $35) | 4,644 | 3,625 |
Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses (net of allowance for credit losses: $21 and $22) | 7,064 | 6,564 |
Contractholder receivables (net of allowance for credit losses: $3 and $3) | 1,814 | 1,731 |
Ceded unearned premiums | 2,170 | 1,799 |
Deferred acquisition costs | 1,531 | 1,264 |
Receivable for securities sold | 63 | 12 |
Goodwill and intangible assets | 731 | 804 |
Other assets | 4,761 | 2,919 |
Total assets | 58,906 | 47,990 |
Liabilities | ||
Reserve for losses and loss adjustment expenses | 22,752 | 20,032 |
Unearned premiums | 8,808 | 7,337 |
Reinsurance balances payable | 2,000 | 1,530 |
Contractholder payables | 1,817 | 1,734 |
Collateral held for insured obligations | 259 | 249 |
Senior notes | 2,726 | 2,725 |
Payable for securities purchased | 247 | 95 |
Other liabilities | 1,942 | 1,367 |
Total liabilities | 40,551 | 35,069 |
Commitments and Contingencies | ||
Redeemable noncontrolling interests | 2 | 11 |
Shareholders’ Equity | ||
Non-cumulative preferred shares | 830 | 830 |
Common shares ($0.0011 par, shares issued: 591.9 and 588.3) | 1 | 1 |
Additional paid-in capital | 2,327 | 2,211 |
Retained earnings | 20,295 | 15,892 |
Accumulated other comprehensive income (loss), net of deferred income tax | (676) | (1,646) |
Common shares held in treasury, at cost (shares: 218.5 and 217.9) | (4,424) | (4,378) |
Total shareholders' equity available to Arch | 18,353 | 12,910 |
Total liabilities, noncontrolling interests and shareholders' equity | 58,906 | 47,990 |
Fixed maturities available for sale, at fair value (amortized cost: $24,131 and $21,282; net of allowance for credit losses: $28 and $41) | ||
Investments: | ||
Debt securities available for sale, at fair value | 23,553 | 19,683 |
Short-term investments available for sale, at fair value (amortized cost: $2,064 and $1,333; net of allowance for credit losses: $0 and $0 ) | ||
Investments: | ||
Debt securities available for sale, at fair value | $ 2,063 | $ 1,332 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) shares in Millions, $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Fixed maturities available for sale, at amortized cost | $ 26,195 | $ 22,615 |
Allowance for credit losses on investments | 28 | 41 |
Investments accounted for using the fair value option | 2,488 | 1,644 |
Allowance for credit losses on premiums receivable | 34 | 35 |
Allowance for credit losses on reinsurance recoverable | 21 | 22 |
Allowance for credit loss on contractholder receivable | $ 3 | $ 3 |
Common shares, par value per share | $ 0.0011 | $ 0.0011 |
Common shares issued (shares) | 591.9 | 588.3 |
Common shares held in treasury (shares) | 218.5 | 217.9 |
Fixed maturities available for sale, at fair value (amortized cost: $24,131 and $21,282; net of allowance for credit losses: $28 and $41) | ||
Fixed maturities available for sale, at amortized cost | $ 24,131 | $ 21,282 |
Allowance for credit losses on investments | 28 | 41 |
Short-term investments | ||
Fixed maturities available for sale, at amortized cost | 2,064 | 1,333 |
Allowance for credit losses on investments | $ 0 | $ 0 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenues | |||
Net premiums earned | $ 12,440 | $ 9,679 | $ 8,082 |
Net investment income | 1,023 | 496 | 389 |
Net realized gains (losses) | (165) | (663) | 380 |
Other underwriting income | 31 | 13 | 21 |
Equity in net income of investments accounted for using the equity method | 278 | 115 | 366 |
Other income (loss) | 27 | (27) | 10 |
Total revenues | 13,634 | 9,613 | 9,248 |
Expenses | |||
Losses and loss adjustment expenses | 6,246 | 5,028 | 4,585 |
Acquisition expenses | 2,312 | 1,740 | 1,303 |
Other operating expenses | 1,301 | 1,128 | 999 |
Corporate expenses | 102 | 95 | 78 |
Amortization of intangible assets | 95 | 106 | 82 |
Interest expense | 133 | 131 | 139 |
Net foreign exchange losses (gains) | 60 | (102) | (41) |
Total expenses | 10,249 | 8,126 | 7,145 |
Income before income taxes and income (loss) from operating affiliates | 3,385 | 1,487 | 2,103 |
Income taxes: | |||
Current tax expense (benefit) | 288 | 201 | 295 |
Deferred tax expense (benefit) | (1,161) | (121) | (167) |
Income tax expense (benefit) | (873) | 80 | 128 |
Income (loss) from operating affiliates | 184 | 75 | 264 |
Net income | 4,442 | 1,482 | 2,239 |
Net (income) loss attributable to noncontrolling interests | 1 | (6) | (82) |
Net income available to Arch | 4,443 | 1,476 | 2,157 |
Preferred share dividends | (40) | (40) | (48) |
Loss on redemption of preferred shares | 0 | 0 | (15) |
Net income available to Arch common shareholders | $ 4,403 | $ 1,436 | $ 2,094 |
Net income per common share and common share equivalent | |||
Basic (per share) | $ 11.94 | $ 3.90 | $ 5.35 |
Diluted (per share) | $ 11.62 | $ 3.80 | $ 5.23 |
Weighted average common shares and common share equivalents outstanding | |||
Basic (shares) | 368.7 | 368.6 | 391.7 |
Diluted (shares) | 378.8 | 377.6 | 400.3 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Comprehensive Income | |||
Net income | $ 4,442 | $ 1,482 | $ 2,239 |
Unrealized appreciation (decline) in value of available-for-sale investments: | |||
Unrealized holding gains (losses) arising during year | 547 | (1,772) | (386) |
Reclassification of net realized (gains) losses, included in net income | 400 | 247 | (117) |
Foreign currency translation adjustments | 23 | (56) | (65) |
Comprehensive income (loss) | 5,412 | (99) | 1,671 |
Net (income) loss attributable to noncontrolling interests | 1 | (6) | (82) |
Other comprehensive (income) loss attributable to noncontrolling interests | 0 | 0 | 14 |
Comprehensive income available to Arch (loss) | $ 5,413 | $ (105) | $ 1,603 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Millions | Total | Non-cumulative preferred shares | Common shares | Additional paid-in capital | Retained earnings | Accumulated other comprehensive income (loss) | Unrealized Appreciation on Available-For-Sale Investments | Foreign currency translation adjustments, net of deferred income tax | Common shares held in treasury, at cost |
Balance at beginning of year at Dec. 31, 2020 | $ 780 | $ 1 | $ 1,978 | $ 12,362 | $ 489 | $ 501 | $ (12) | $ (2,504) | |
Preferred shares issued | 500 | ||||||||
Preferred shares redeemed | (450) | ||||||||
Issue costs on preferred shares issued | (14) | ||||||||
Loss on redemption of preferred shares | $ (15) | 15 | (15) | ||||||
Amortization of share-based compensation | 86 | ||||||||
Other changes | 20 | ||||||||
Net income | 2,239 | 2,239 | |||||||
Net (income) loss attributable to noncontrolling interests | (82) | (82) | |||||||
Preferred share dividends | (48) | (48) | |||||||
Unrealized holding gains (losses) during period, net of reclassification adjustment | (503) | ||||||||
Unrealized holding gains (losses) during period attributable to noncontrolling interests | 15 | ||||||||
Foreign currency translation adjustments | (65) | (65) | |||||||
Foreign currency translation adjustments attributable to noncontrolling interests | (1) | ||||||||
Shares repurchased for treasury | (1,234) | (1,257) | |||||||
Balance at end of year at Dec. 31, 2021 | 13,546 | 830 | 1 | 2,085 | 14,456 | (65) | 13 | (78) | (3,761) |
Preferred shares issued | 0 | ||||||||
Preferred shares redeemed | 0 | ||||||||
Issue costs on preferred shares issued | 0 | ||||||||
Loss on redemption of preferred shares | 0 | 0 | 0 | ||||||
Amortization of share-based compensation | 88 | ||||||||
Other changes | 38 | ||||||||
Net income | 1,482 | 1,482 | |||||||
Net (income) loss attributable to noncontrolling interests | (6) | (6) | |||||||
Preferred share dividends | (40) | (40) | |||||||
Unrealized holding gains (losses) during period, net of reclassification adjustment | (1,525) | ||||||||
Unrealized holding gains (losses) during period attributable to noncontrolling interests | 0 | ||||||||
Foreign currency translation adjustments | (56) | (56) | |||||||
Foreign currency translation adjustments attributable to noncontrolling interests | 0 | ||||||||
Shares repurchased for treasury | (586) | (617) | |||||||
Balance at end of year at Dec. 31, 2022 | 12,910 | 830 | 1 | 2,211 | 15,892 | (1,646) | (1,512) | (134) | (4,378) |
Preferred shares issued | 0 | ||||||||
Preferred shares redeemed | 0 | ||||||||
Issue costs on preferred shares issued | 0 | ||||||||
Loss on redemption of preferred shares | 0 | 0 | 0 | ||||||
Amortization of share-based compensation | 93 | ||||||||
Other changes | 23 | ||||||||
Net income | 4,442 | 4,442 | |||||||
Net (income) loss attributable to noncontrolling interests | 1 | 1 | |||||||
Preferred share dividends | (40) | (40) | |||||||
Unrealized holding gains (losses) during period, net of reclassification adjustment | 947 | ||||||||
Unrealized holding gains (losses) during period attributable to noncontrolling interests | 0 | ||||||||
Foreign currency translation adjustments | 23 | 23 | |||||||
Foreign currency translation adjustments attributable to noncontrolling interests | 0 | ||||||||
Shares repurchased for treasury | 0 | (46) | |||||||
Balance at end of year at Dec. 31, 2023 | $ 18,353 | $ 830 | $ 1 | $ 2,327 | $ 20,295 | $ (676) | $ (565) | $ (111) | $ (4,424) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Activities | |||
Net income | $ 4,442 | $ 1,482 | $ 2,239 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Net realized (gains) losses | 182 | 651 | (427) |
Equity in net (income) or loss of investments accounted for using the equity method and other income or loss | (215) | 154 | (464) |
Amortization of intangible assets | 95 | 106 | 82 |
Share-based compensation | 93 | 88 | 88 |
Changes in: | |||
Reserve for losses and loss adjustment expenses, net of unpaid losses and loss adjustment expenses recoverable | 2,138 | 1,890 | 1,762 |
Unearned premiums, net of ceded unearned premiums | 1,028 | 1,399 | 935 |
Premiums receivable | (981) | (1,110) | (685) |
Deferred acquisition costs | (235) | (374) | (263) |
Reinsurance balances payable | 455 | (36) | 499 |
Deferred income tax assets, net | (1,161) | (121) | (167) |
Other items, net | (92) | (313) | (174) |
Net cash provided by operating activities | 5,749 | 3,816 | 3,425 |
Investing Activities: | |||
Purchases of fixed maturity investments | (18,062) | (16,390) | (35,452) |
Purchases of equity securities | (456) | (797) | (1,175) |
Purchases of other investments | (2,171) | (1,720) | (1,859) |
Proceeds from sales of fixed maturity investments | 14,105 | 11,844 | 33,577 |
Proceeds from sales of equity securities | 288 | 1,554 | 918 |
Proceeds from sales, redemptions and maturities of other investments | 768 | 1,220 | 1,766 |
Proceeds from redemptions and maturities of fixed maturity investments | 781 | 715 | 1,629 |
Net settlements of derivative instruments | 50 | (69) | (39) |
Net (purchases) sales of short-term investments | (696) | 467 | 165 |
Purchase of operating affiliate | 0 | 0 | (754) |
Impact of the deconsolidation of the variable interest entity | 0 | 0 | (349) |
Purchases of fixed assets | (52) | (50) | (41) |
Other | (23) | 125 | (524) |
Net cash used for investing activities | (5,468) | (3,101) | (2,138) |
Financing Activities: | |||
Proceeds from issuance of preferred shares, net | 0 | 0 | 486 |
Redemption of preferred shares | 0 | 0 | (450) |
Purchases of common shares under share repurchase program | 0 | (586) | (1,234) |
Proceeds from common shares issued, net | (2) | 6 | 6 |
Third party investment in non-redeemable noncontrolling interests | 0 | 0 | 16 |
Third party investment in redeemable noncontrolling interests | (22) | 0 | 0 |
Dividends paid to redeemable noncontrolling interests | 0 | 0 | (2) |
Other | (5) | (86) | (4) |
Preferred dividends paid | (40) | (40) | (47) |
Net Cash Provided by (Used in) Financing Activities | (69) | (706) | (1,229) |
Effects of exchange rate changes on foreign currency cash and restricted cash | 13 | (50) | (34) |
Increase (decrease) in cash and restricted cash | 225 | (41) | 24 |
Cash and restricted cash, beginning of year | 1,273 | 1,314 | 1,290 |
Cash and restricted cash, end of year | 1,498 | 1,273 | 1,314 |
Supplemental cash flow information | |||
Income taxes paid (received) | 267 | 255 | 286 |
Interest paid | $ 127 | $ 128 | $ 139 |
General
General | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | Arch Capital Group Ltd. (“Arch Capital” or “Arch”) 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 2021 consolidated financial statements included the results of Somers Group Holdings Ltd. (formerly Watford Holdings Ltd.) and its wholly owned subsidiaries (“Somers”). 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. Such reclassifications had no effect on the Company’s net income, shareholders’equity or cash flows. All amounts are in millions, except per share amounts, unless otherwise noted. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2023 | |
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 retained its existing risk in force and will remain Westpac’s exclusive provider of LMI on new mortgage originations for a period of 10 years from the acquisition date. The Company was renamed Arch Lenders Mortgage Indemnity Limited (“Arch Indemnity”) and will be 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. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
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 (“AMG”), 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” and together with Arch Syndicate 2012, the Company’s “Lloyd’s Syndicates”). 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 income 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. Unearned premiums for the Company’s mortgage operations 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. 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. 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 2023, 2022 or 2021. (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 or 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. 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 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 as an unrealized loss in other comprehensive income while the allowance for credit loss is charged to net realized gains (losses) in the consolidated statement of income. 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. 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 (losses)” 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 2023, 2022, and 2021, 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 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 based on estimates, and the ultimate net cost may vary from such estimates. The methods for making such estimates and for establishing the resulting liability are reviewed and updated using the most current information available. Any resulting adjustments, which may be material, are reflected in current operation |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2023 | |
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 for middle market and large construction accounts, a comprehensive range of products for middle market accounts in specialty industries and casualty solutions for large national accounts, including loss sensitive primary insurance programs (large deductible, self-insured retention and retrospectively rated programs). • Excess and surplus casualty: primary and excess casualty insurance coverages written primarily on a non-admitted basis. • 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, cyber insurance, and medical professional and general liability insurance coverages for the healthcare industry. The business is predominately written on a claims-made basis. • Programs: primarily targeting program managers with unique expertise and niche products offering some combination of general liability, commercial automobile, property, inland marine, umbrella and workers’ compensation. • 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, cargo, war, specie and liability. Aviation, stand-alone terrorism and political risks are also offered. Coverage may be provided for operational and construction risk. • 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. • Warranty and lenders solutions: 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. • 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, commercial and transactional surety coverages. The reinsurance segment consists of the Company’s reinsurance underwriting units which offer specialty product lines on a worldwide basis. Reinsurance agreements are typically offered on a proportional and/or excess of loss basis and provide coverage to ceding company clients for specific underlying written policies. Product lines include: • Casualty: provides coverage on third party liability exposures including, among others, executive assurance, professional liability, excess and umbrella liability, excess motor and healthcare business, and workers’ compensation. Business is assumed primarily on a treaty basis, with some facultative coverages also offered. • 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 for proportional motor reinsurance, whole account multi-line treaties, cyber, trade credit and surety, accident and health, workers’ compensation catastrophe, agriculture and political risk, among others. • Property catastrophe: provides protection for most types of catastrophic losses, including hurricane, earthquake, flood, tornado, hail and fire, and for other perils on a case-by-case basis. Excess of loss coverages are triggered when aggregate losses and loss adjustment expense from a single occurrence or aggregation of losses from a covered peril exceed the retention specified in the contract. • Property excluding property catastrophe: provides coverage for personal lines and/or 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 either a treaty basis or facultative basis. • Other: primarily includes life reinsurance business. The mortgage segment includes the Company’s underwriting units which offer mortgage insurance and reinsurance products on a worldwide basis. Underwriting units include: • U.S. primary mortgage insurance: offers private mortgage insurance through Arch Mortgage Insurance Company and United Guaranty Residential Insurance Company (combined “Arch MI U.S.”), both approved eligible mortgage insurers by Fannie Mae and Freddie Mac. Arch MI U.S. also includes AMG, which is not a government sponsored enterprise (“GSE”) approved entity. • U.S. credit risk transfer (“CRT”) and other : underwrites CRT transactions, which are predominantly with GSEs, and other U.S. reinsurance transactions. • International mortgage insurance/reinsurance: underwrites mortgage insurance and reinsurance outside of the U.S. The corporate segment results include net investment income, net realized gains or losses (which includes realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains and losses on derivative instruments and changes in the allowance for credit losses on financial assets), equity in net income or loss of investment funds 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 items, income or loss from operating affiliates and items related to the Company’s non cumulative preferred shares. Through June 30, 2021, the ‘other’ segment included the results of Somers. In July 2021, the Company announced the completion of the previously disclosed acquisition of Somers by Greysbridge. Based on the governing documents of Greysbridge, the Company has 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, 2023 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 7,911 $ 9,113 $ 1,387 $ 18,403 $ — $ 18,403 Premiums ceded (1) (2,049) (2,559) (335) (4,935) — (4,935) Net premiums written 5,862 6,554 1,052 13,468 — 13,468 Change in unearned premiums (416) (718) 106 (1,028) — (1,028) Net premiums earned 5,446 5,836 1,158 12,440 — 12,440 Other underwriting income — 17 14 31 — 31 Losses and loss adjustment expenses (3,122) (3,227) 103 (6,246) — (6,246) Acquisition expenses (1,055) (1,240) (17) (2,312) — (2,312) Other operating expenses (819) (288) (194) (1,301) — (1,301) Underwriting income $ 450 $ 1,098 $ 1,064 2,612 — 2,612 Net investment income 1,023 — 1,023 Net realized gains (losses) (165) — (165) Equity in net income (loss) of investments accounted for using the equity method 278 — 278 Other income (loss) 27 — 27 Corporate expenses (96) — (96) Transaction costs and other (6) — (6) Amortization of intangible assets (95) — (95) Interest expense (133) — (133) Net foreign exchange gains (losses) (60) — (60) Income (loss) before income taxes and income (loss) from operating affiliates 3,385 — 3,385 Income tax (expense) benefit 873 — 873 Income (loss) from operating affiliates 184 — 184 Net income (loss) 4,442 — 4,442 Amounts attributable to redeemable noncontrolling interests 1 — 1 Net income (loss) available to Arch 4,443 — 4,443 Preferred dividends (40) — (40) Net income (loss) available to Arch common shareholders $ 4,403 $ — $ 4,403 Underwriting Ratios Loss ratio 57.3 % 55.3 % -8.9 % 50.2 % — % 50.2 % Acquisition expense ratio 19.4 % 21.2 % 1.4 % 18.6 % — % 18.6 % Other operating expense ratio 15.0 % 4.9 % 16.8 % 10.5 % — % 10.5 % Combined ratio 91.7 % 81.4 % 9.3 % 79.3 % — % 79.3 % Goodwill and intangible assets $ 224 $ 130 $ 377 $ 731 $ — $ 731 Total investable assets $ 34,589 $ — $ 34,589 Total assets 58,906 — 58,906 Total liabilities 40,551 — 40,551 (1) Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations. Year Ended December 31, 2022 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 6,931 $ 6,948 $ 1,455 $ 15,327 $ — $ 15,327 Premiums ceded (1) (1,910) (2,024) (322) (4,249) — (4,249) Net premiums written 5,021 4,924 1,133 11,078 — 11,078 Change in unearned premiums (461) (965) 27 (1,399) — (1,399) Net premiums earned 4,560 3,959 1,160 9,679 — 9,679 Other underwriting income — 5 8 13 — 13 Losses and loss adjustment expenses (2,784) (2,568) 324 (5,028) — (5,028) Acquisition expenses, net (887) (813) (40) (1,740) — (1,740) Other operating expenses (665) (268) (195) (1,128) — (1,128) Underwriting income (loss) $ 224 $ 315 $ 1,257 1,796 — 1,796 Net investment income 496 — 496 Net realized gains (losses) (663) — (663) Equity in net income (loss) of investments accounted for using the equity method 115 — 115 Other income (loss) (27) — (27) Corporate expenses (95) — (95) Transaction costs and other — — — Amortization of intangible assets (106) — (106) Interest expense (131) — (131) Net foreign exchange gains (losses) 102 — 102 Income (loss) before income taxes and income (loss) from operating affiliates 1,487 — 1,487 Income tax (expense) benefit (80) — (80) Income (loss) from operating affiliates 75 — 75 Net income (loss) 1,482 — 1,482 Amounts attributable to redeemable noncontrolling interests (6) — (6) Net income (loss) available to Arch 1,476 — 1,476 Preferred dividends (40) — (40) Net income (loss) available to Arch common shareholders $ 1,436 $ — $ 1,436 Underwriting Ratios Loss ratio 61.0 % 64.9 % -28.0 % 51.9 % — % 51.9 % Acquisition expense ratio 19.4 % 20.5 % 3.5 % 18.0 % — % 18.0 % Other operating expense ratio 14.6 % 6.8 % 16.8 % 11.7 % — % 11.7 % Combined ratio 95.0 % 92.2 % -7.7 % 81.6 % — % 81.6 % Goodwill and intangible assets $ 229 $ 145 $ 430 $ 804 $ — $ 804 Total investable assets $ 28,065 $ — $ 28,065 Total assets 47,990 — 47,990 Total liabilities 35,069 — 35,069 (1) Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations. Year Ended December 31, 2021 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 5,868 $ 5,094 $ 1,508 $ 12,463 $ 458 $ 12,752 Premiums ceded (1) (1,719) (1,840) (247) (3,799) (105) (3,735) Net premiums written 4,149 3,254 1,261 8,664 353 9,017 Change in unearned premiums (524) (413) 22 (915) (20) (935) Net premiums earned 3,625 2,841 1,283 7,749 333 8,082 Other underwriting income — 3 18 21 — 21 Losses and loss adjustment expenses (2,345) (1,925) (57) (4,327) (258) (4,585) Acquisition expenses, net (606) (537) (97) (1,240) (63) (1,303) Other operating expenses (559) (214) (193) (966) (33) (999) Underwriting income (loss) $ 115 $ 168 $ 954 1,237 (21) 1,216 Net investment income 347 42 389 Net realized gains (losses) 299 81 380 Equity in net income (loss) of investments accounted for using the equity method 366 — 366 Other income (loss) 10 — 10 Corporate expenses (76) — (76) Transaction costs and other (1) (1) (2) Amortization of intangible assets (81) (1) (82) Interest expense (131) (8) (139) Net foreign exchange gains (losses) 42 (1) 41 Income (loss) before income taxes and income (loss) from operating affiliates 2,012 91 2,103 Income tax (expense) benefit (128) — (128) Income (loss) from operating affiliates 264 — 264 Net income 2,148 91 2,239 Amounts attributable to redeemable noncontrolling interests (2) (2) (4) Amounts attributable to nonredeemable noncontrolling interests — (78) (78) Net income (loss) available to Arch 2,148 9 2,157 Preferred dividends (48) — (48) Loss on redemption of preferred shares (15) — (15) Net income (loss) available to Arch common shareholders $ 2,085 $ 9 $ 2,094 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 $ 184 $ 505 $ 945 $ — $ 945 Total investable assets $ 27,442 $ — $ 27,442 Total assets 45,101 — 45,101 Total liabilities 31,546 — 31,546 (1) Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations. 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, 2023 2022 2021 Net premiums earned (1) Professional lines $ 1,419 $ 1,314 $ 943 Property, energy, marine and aviation 1,064 772 668 Programs 658 590 507 Construction and national accounts 561 432 417 Travel, accident and health 557 492 256 Excess and surplus casualty 486 393 318 Warranty and lenders solutions 185 128 153 Other 516 439 363 Total $ 5,446 $ 4,560 $ 3,625 Net premiums written by underwriting location (1) United States $ 3,780 $ 3,342 $ 2,812 Europe 1,774 1,405 1,126 Other 308 274 211 Total $ 5,862 $ 5,021 $ 4,149 REINSURANCE SEGMENT Year Ended December 31, 2023 2022 2021 Net premiums earned (1) Other specialty $ 2,097 $ 1,378 $ 819 Property excluding property catastrophe 1,645 1,090 838 Casualty 1,005 855 667 Property catastrophe 742 367 280 Marine and aviation 229 159 153 Other 118 110 84 Total $ 5,836 $ 3,959 $ 2,841 Net premiums written by underwriting location (1) United States $ 1,756 $ 1,247 $ 829 Bermuda 3,288 2,561 1,555 Europe and other 1,510 1,116 870 Total $ 6,554 $ 4,924 $ 3,254 MORTGAGE SEGMENT Year Ended December 31, 2023 2022 2021 Net premiums earned U.S. primary mortgage insurance $ 759 $ 804 $ 953 U.S. credit risk transfer (CRT) and other 220 196 181 International mortgage insurance/reinsurance 179 160 149 Total $ 1,158 $ 1,160 $ 1,283 Net premiums written by underwriting location United States $ 743 $ 781 $ 913 Other 309 352 348 Total $ 1,052 $ 1,133 $ 1,261 (1) Segment results include intersegment transactions. OTHER SEGMENT Year Ended December 31, 2023 2022 2021 Net premiums earned (1) Casualty $ — $ — $ 138 Other specialty — — 118 Property catastrophe — — 15 Property excluding property catastrophe — — 7 Marine and aviation — — — Other — — 55 Total $ — $ — $ 333 Net premiums written by underwriting location (1) United States $ — $ — $ 63 Europe — — 91 Bermuda — — 199 Total $ — $ — $ 353 |
Reserve for Losses and Loss Adj
Reserve for Losses and Loss Adjustment Expenses | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 2022 2021 Reserve for losses and loss adjustment expenses at beginning of year $ 20,032 $ 17,757 $ 16,514 Unpaid losses and loss adjustment expenses recoverable 6,280 5,599 4,315 Net reserve for losses and loss adjustment expenses at beginning of year 13,752 12,158 12,199 Net incurred losses and loss adjustment expenses relating to losses occurring in: Current year 6,784 5,797 4,940 Prior years (538) (769) (355) Total net incurred losses and loss adjustment expenses 6,246 5,028 4,585 Net losses and loss adjustment expense reserves of acquired business (1) — — 104 Retroactive reinsurance transactions (2) — — (444) Impact of deconsolidation of Somers (3) — — (1,461) Foreign exchange (gains) losses and other 157 (293) 2 Net paid losses and loss adjustment expenses relating to losses occurring in: Current year (1,081) (888) (734) Prior years (3,012) (2,253) (2,093) Total net paid losses and loss adjustment expenses (4,093) (3,141) (2,827) Net reserve for losses and loss adjustment expenses at end of year 16,062 13,752 12,158 Unpaid losses and loss adjustment expenses recoverable 6,690 6,280 5,599 Reserve for losses and loss adjustment expenses at end of year $ 22,752 $ 20,032 $ 17,757 (1) Represents activity related to the Company’s acquisitions in the 2021 period. See note 2, “Acquisitions.” (2) See ‘Retroactive Reinsurance Transactions’ section. (3) See note 12, “Variable Interest Entity and Noncontrolling Interests.” Development on Prior Year Loss Reserves Year Ended December 31, 2023 During 2023, the Company recorded estimated net favorable development on prior year loss reserves of $538 million, which consisted of net favorable development of $42 million from the insurance segment, $152 million from the reinsurance segment and $344 million from the mortgage segment. The insurance segment’s net favorable development of $42 million, or 0.8 points of net earned premium, consisted of $107 million of net favorable development in short and long-tailed lines partially offset by $65 million of net adverse development from medium-tailed lines. Net favorable development in short-tailed lines reflected $32 million of favorable development in property (excluding marine), primarily from the 2022 accident year ( i.e. , the year in which a loss occurred), $22 million of favorable development related to warranty and lenders solutions business, primarily from the 2022 accident year, and $15 million of favorable development related to travel and accident business, primarily from the 2020 and 2022 accident years. Net favorable development in long-tailed lines included $28 million of favorable development in executive assurance business, primarily from the 2019 and 2021 accident years, and $17 million of favorable development in alternative markets business, primarily from the 2021 and prior accident years. Such amounts were partially offset by $6 million of net adverse development in construction and national accounts, primarily from the 2020 to 2022 accident years. Net adverse development in medium-tailed lines reflected $50 million of adverse development in professional liability business, primarily from the 2017 to 2020 accident years, and $21 million of adverse development in contract binding business, primarily from 2020 and prior accident years, partially offset by $12 million of favorable development in marine business, primarily from the 2020 and 2021 accident years. The reinsurance segment’s net favorable development of $152 million, or 2.6 points of net earned premium, consisted of $202 million of net favorable development from short and medium-tailed lines, partially offset by $50 million of net adverse development from long-tailed lines. Net favorable development in short-tailed lines reflected $93 million of favorable development from property other than property catastrophe business, primarily from the 2020 to 2022 underwriting years ( i.e. , all premiums and losses attributable to contracts having an inception or renewal date within the given twelve-month period), $51 million of favorable development from property catastrophe business, primarily from the 2019 to 2022 underwriting years, $35 million from other specialty business, primarily from the 2021 underwriting year, and $13 million of favorable development from other lines of business, primarily from the 2020 underwriting year. Net favorable development in medium-tailed lines reflected $9 million from marine and aviation business, primarily from 2021 and prior underwriting years. Net adverse development in long-tailed lines primarily reflected $46 million from casualty business, primarily from the 2013 to 2020 underwriting years. The mortgage segment net favorable development was $344 million, or 29.7 points, for the 2023 period, with the largest contributor being reserve releases associated with the U.S. first lien portfolio from the 2020 to 2022 accident years. The Company’s credit risk transfer and international businesses also contributed to the favorable development. Year Ended December 31, 2022 During 2022, the Company recorded estimated net favorable development on prior year loss reserves of $769 million, which consisted of net favorable development of $25 million from the insurance segment, $190 million from the reinsurance segment and $554 million from the mortgage segment. The insurance segment’s net favorable development of $25 million, or 0.6 points of net earned premium, consisted of $55 million of net favorable development in short-tailed lines partially offset by $30 million of net adverse development from medium-tailed and long-tailed lines. Net favorable development in short-tailed lines reflected $37 million of favorable development in warranty and lenders solutions, primarily from the 2021 accident year, and $15 million of favorable development related to travel and accident business, primarily from the 2020 and 2021 accident years. Net adverse development in medium-tailed lines reflected $25 million of adverse development in professional liability business, primarily from the 2013 to 2015 and 2018 to 2020 accident years, and $6 million of adverse development in contract binding business, across most accident years, partially offset by $13 million of favorable development in marine business, across most accident years. Net adverse development in long-tail lines reflected $19 million of adverse development related to casualty business, primarily from the 2020 and 2021 accident years, and $7 million of adverse development on construction and national accounts, primarily from the 2017, 2020 and 2021 accident years. This is partially offset by $22 million of favorable development in other business, including alternative markets and excess workers’ compensation, primarily from the 2019 and prior accident years. The reinsurance segment’s net favorable development of $190 million, or 4.8 points of net earned premium, consisted of $196 million of net favorable development from short-tailed and medium-tailed lines, partially offset by $5 million of net adverse development from long-tailed lines. Net favorable development in short-tailed lines reflected $109 million of favorable development from property other than property catastrophe business, primarily from the 2018 to 2021 underwriting years, $24 million of favorable development from property catastrophe business, primarily from the 2018 to 2020 underwriting years, and $35 million from other specialty business, primarily from the 2016 and 2021 underwriting years. Net favorable development in medium-tailed lines reflected $28 million in marine and aviation lines, across most underwriting years. Net adverse development in long-tailed lines primarily reflected $5 million in casualty, spread across many prior underwriting years. The mortgage segment experienced net favorable development of $554 million, or 47.8 points of net earned premium, with the majority of reserve releases being on COVID-related delinquencies associated with the U.S. first lien portfolio from the 2020 and 2021 accident years. The Company’s credit risk transfer, international, second lien and student loan businesses also contributed to the favorable development. Year Ended December 31, 2021 During 2021, the Company recorded estimated net favorable development on prior year loss reserves of $355 million, which consisted of net favorable development of $16 million from the insurance segment, $179 million from the reinsurance segment, $170 million from the mortgage segment, partially offset by $8 million of adverse development from the ‘other’ segment (activity prior to the deconsolidation of Somers). The insurance segment’s net favorable development of $16 million, or 0.4 points of net earned premium, consisted of $110 million of net favorable development in short-tailed and long-tailed lines mostly offset by $94 million of net adverse development from medium-tailed lines. Net favorable development of $82 million in short-tailed lines reflected $39 million of favorable development from property (excluding marine), primarily from the 2018 to 2020 accident years, $27 million of favorable development in warranty and lenders solutions, primarily from the 2020 accident year, and $16 million of favorable development on travel and accident, primarily from the 2016 to 2020 accident years. Net favorable development of $28 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 $58 million of adverse development in contract binding, primarily from the 2013 to 2019 accident years and $31 million of adverse development in professional liability, primarily from the 2018 to 2020 accident years. The reinsurance segment’s net favorable development of $179 million, or 6.3 points of net earned premium, consisted of $184 million of net favorable development from short-tailed and medium-tailed lines, partially offset by $5 million of net adverse development from long-tailed lines. Net favorable development of $176 million in short-tailed lines reflected $123 million from other specialty lines, primarily from the 2014 to 2019 underwriting years, and $89 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 million from property catastrophe, primarily from the 2020 underwriting year. Adverse development in long-tailed lines reflected an increase in casualty, primarily from the 2018 underwriting year. The mortgage segment experienced net favorable development of $170 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. 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, “Transactions with Related Parties” . |
Short Duration Contracts
Short Duration Contracts | 12 Months Ended |
Dec. 31, 2023 | |
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; warranty and lenders solutions; 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 and (ii) certain reinsurance business, including casualty clash and non-traditional lines. 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 warranty and lenders solutions), 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. From time to time, the Company enters into loss portfolio transfer and adverse development cover reinsurance agreements accounted for as retroactive reinsurance. These agreements transfer 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, 2023 included $225 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 (in millions except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 148 $ 146 $ 147 $ 136 $ 132 $ 134 $ 135 $ 135 $ 134 $ 133 $ 2 3,871 2015 112 110 104 102 98 92 92 91 89 2 4,530 2016 104 101 105 100 96 92 88 88 — 6,171 2017 281 246 236 230 231 225 225 1 6,475 2018 181 186 174 170 170 172 5 5,077 2019 179 179 165 161 159 (1) 7,018 2020 359 329 336 333 9 8,212 2021 427 429 423 41 8,807 2022 522 495 74 13,274 2023 571 275 13,682 Total $ 2,688 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 26 $ 54 $ 78 $ 84 $ 88 $ 98 $ 115 $ 122 $ 123 $ 125 2015 24 65 76 86 88 86 87 88 86 2016 25 83 98 97 95 91 87 87 2017 30 140 196 212 216 218 220 2018 30 102 135 143 150 154 2019 26 105 134 139 148 2020 56 194 251 293 2021 90 268 343 2022 100 276 2023 146 Total 1,878 All outstanding liabilities before 2014, net of reinsurance 14 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 824 Third party occurrence business (in millions except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 330 $ 336 $ 339 $ 343 $ 339 $ 344 $ 343 $ 343 $ 345 $ 344 $ 49 75,679 2015 359 392 399 392 391 382 386 379 377 66 78,689 2016 390 394 406 399 375 368 363 352 77 78,883 2017 417 418 422 412 407 406 405 100 84,687 2018 430 453 451 451 459 462 127 78,320 2019 456 487 481 471 470 154 86,139 2020 607 616 640 632 226 92,279 2021 622 663 659 290 92,672 2022 688 726 513 92,564 2023 877 750 72,833 Total $ 5,304 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 9 $ 40 $ 71 $ 113 $ 162 $ 191 $ 211 $ 224 $ 237 $ 257 2015 11 45 88 139 182 212 227 249 268 2016 12 42 88 137 165 195 215 231 2017 13 52 100 135 165 221 247 2018 17 64 115 154 200 247 2019 18 73 122 173 214 2020 24 77 155 235 2021 26 91 174 2022 24 85 2023 32 Total 1,990 All outstanding liabilities before 2014, net of reinsurance 287 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 3,601 Third party claims-made business (in millions except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 264 $ 279 $ 299 $ 279 $ 281 $ 297 $ 291 $ 288 $ 296 $ 287 $ 14 14,494 2015 259 277 276 260 255 252 268 267 274 13 13,932 2016 275 291 308 314 322 327 330 327 18 14,912 2017 270 286 312 308 323 317 338 48 15,473 2018 273 314 320 336 347 367 44 17,098 2019 289 317 317 322 330 66 15,879 2020 383 413 423 446 118 15,239 2021 515 518 499 254 16,323 2022 669 655 448 18,563 2023 811 641 20,494 Total $ 4,334 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 14 $ 63 $ 129 $ 173 $ 207 $ 229 $ 243 $ 249 $ 260 $ 266 2015 9 52 100 126 174 193 217 221 242 2016 11 68 127 158 205 242 257 296 2017 9 68 113 143 196 233 258 2018 12 68 118 158 208 258 2019 12 65 122 155 197 2020 17 87 152 215 2021 23 90 163 2022 25 100 2023 64 Total 2,059 All outstanding liabilities before 2014, net of reinsurance 77 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 2,352 Multi-line and other specialty (in millions except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 302 $ 326 $ 318 $ 318 $ 317 $ 313 $ 310 $ 309 $ 311 $ 310 $ 4 148,702 2015 335 358 357 365 357 349 347 345 345 5 180,468 2016 409 431 428 416 410 408 409 406 7 192,955 2017 482 501 491 501 504 513 516 9 235,539 2018 512 565 563 565 565 565 14 260,995 2019 567 612 640 651 657 21 252,766 2020 618 569 515 517 44 166,357 2021 635 619 614 76 114,447 2022 678 642 157 143,264 2023 817 450 118,241 Total $ 5,389 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 108 $ 197 $ 234 $ 267 $ 281 $ 292 $ 293 $ 295 $ 296 $ 297 2015 138 236 278 306 321 327 330 331 333 2016 176 305 342 363 379 385 390 392 2017 181 342 381 423 446 472 480 2018 212 389 443 480 509 527 2019 212 386 487 549 577 2020 172 309 359 406 2021 157 335 428 2022 177 371 2023 254 Total 4,065 All outstanding liabilities before 2014, net of reinsurance 24 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 1,348 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, 2023: 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 20.5 % 43.7 % 18.1 % 6.0 % 2.2 % 1.0 % 2.6 % 1.9 % (0.4) % 1.5 % Third party occurrence business 3.5 % 9.4 % 11.5 % 11.4 % 9.9 % 9.8 % 5.6 % 4.6 % 4.4 % 5.6 % Third party claims-made business 4.1 % 15.5 % 16.5 % 11.1 % 14.3 % 10.1 % 6.3 % 5.2 % 5.7 % 2.0 % Multi-line and other specialty 34.0 % 29.3 % 11.3 % 8.2 % 4.5 % 2.9 % 1.1 % 0.4 % 0.4 % 0.5 % 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, 2023 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 differs substantially from expectations based on historical information, an adjustment to Loss Reserves may be supported. Estimated Loss Reserves for more mature underwriting years are now based more on actual loss activity and historical patterns than on the initial assumptions based on pricing indications. More recent underwriting years rely more heavily on internal pricing assumptions. 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. In the initial reserving process for short-tail reinsurance lines (consisting of property excluding property catastrophe and property catastrophe exposures), the Company relies on a combination of the reserving methods discussed above. For known catastrophic events, the reserving process also includes the usage of catastrophe models and a heavy reliance on analysis which includes ceding company inquiries and management judgment. The development of property losses may be unstable, especially where there is high catastrophic exposure, may be characterized by high severity, low frequency losses for excess and catastrophe-exposed business and may be highly correlated across contracts. As time passes, for a given underwriting 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 short-tail lines, 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 our underwriters’ judgment and guidance received from ceding companies as to potential loss exposures may be relied on. The expected loss ratios used in the initial reserving process for property exposures have varied over time due to changes in pricing, reinsura |
Allowance for Expected Credit L
Allowance for Expected Credit Losses | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 Premium Receivables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 3,625 $ 35 Change for provision of expected credit losses (1) (1) Balance at end of period $ 4,644 $ 34 Year Ended December 31, 2022 Balance at beginning of period $ 2,633 $ 40 Change for provision of expected credit losses (1) (5) Balance at end of period $ 3,625 $ 35 (1) Amounts deemed uncollectible are written-off in operating expenses. For the 2023 and 2022 periods, amounts written off totaled $3 million and $11 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, 2023 Reinsurance Recoverables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 6,564 $ 22 Change for provision of expected credit losses (1) Balance at end of period $ 7,064 $ 21 Year Ended December 31, 2022 Balance at beginning of period $ 5,881 $ 13 Change for provision of expected credit losses 9 Balance at end of period 6,564 $ 22 The following table summarizes the Company’s reinsurance recoverables on paid and unpaid losses (not including ceded unearned premiums) at December 31, 2023 and 2022: December 31, 2023 2022 Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses $ 7,064 $ 6,564 % due from carriers with A.M. Best rating of “A-” or better 66.8 % 68.8 % % due from all other rated carriers 0.1 % 0.1 % % due from all other carriers with no A.M. Best rating (1) 33.1 % 31.1 % Largest balance due from any one carrier as % of total shareholders’ equity 7.2 % 9.0 % (1) At December 31, 2023 and 2022 period, over 95% of such amount were collateralized through reinsurance trusts, funds withheld arrangements, letters of credit or other, respectively. 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, 2023 Contractholder Receivables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 1,731 $ 3 Change for provision of expected credit losses — Balance at end of period $ 1,814 $ 3 Year Ended December 31, 2022 Balance at beginning of period $ 1,829 $ 3 Change for provision of expected credit losses — Balance at end of period 1,731 $ 3 |
Reinsurance
Reinsurance | 12 Months Ended |
Dec. 31, 2023 | |
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 to third parties. 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, 2023 2022 2021 Premiums Written Direct $ 9,652 $ 8,542 $ 7,707 Assumed 8,751 6,785 5,045 Ceded (4,935) (4,249) (3,735) Net $ 13,468 $ 11,078 $ 9,017 Premiums Earned Direct $ 9,131 $ 8,058 $ 7,150 Assumed 7,890 5,768 4,334 Ceded (4,581) (4,147) (3,402) Net $ 12,440 $ 9,679 $ 8,082 Losses and Loss Adjustment Expenses Direct $ 4,739 $ 3,991 $ 4,267 Assumed 3,975 3,558 2,826 Ceded (2,468) (2,521) (2,508) Net $ 6,246 $ 5,028 $ 4,585 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-year period as the underlying covered mortgages amortize. See note 12, “Variable Interest Entity and Noncontrolling Interests.” The following table summarizes the respective coverages and retentions at December 31, 2023: Bellemeade Entities Initial Coverage at Issuance Current Remaining Retention, Net 2019-1 Ltd. (1) 342 71 134 2019-3 Ltd. (2) 701 99 218 2021-3 Ltd. (3) 639 541 134 2022-1 Ltd. (4) 317 282 141 2022-2 Ltd. (5) 327 327 205 2023-1 Ltd. (6) 233 233 185 Total $ 2,559 $ 1,553 $ 1,017 (1) 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. (2) Issued in July 2019, covering in-force policies issued in 2016. (3) 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. (4) Issued in January 2022, covering in-force policies issued between July 1, 2021 and November 30, 2021. $284 million was directly funded by Bellemeade Re 2022-1 Ltd. via insurance-linked notes, with an additional $33 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers . (5) Issued in September 2022, covering in-force policies issued between November 1, 2021 and June 30, 2022. $201 million was directly funded by Bellemeade Re 2022-2 Ltd. via insurance-linked notes, with an additional $126 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (6) Issued in October 2023, covering in-force policies issued between January 1, 2023 and September 30, 2023. $187 million was directly funded by Bellemeade Re 2023-1 Ltd. via insurance-linked notes, with an additional $47 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. |
Investment Information
Investment Information | 12 Months Ended |
Dec. 31, 2023 | |
Disclosure Investment Information [Abstract] | |
Investment | 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 Cost or December 31, 2023 Fixed maturities: Corporate bonds $ 10,855 $ 157 $ (464) $ (20) $ 11,182 U.S. government and government agencies 5,814 63 (86) — 5,837 Asset backed securities 2,250 11 (55) (5) 2,299 Non-U.S. government securities 2,062 33 (100) (1) 2,130 Commercial mortgage backed securities 1,213 3 (34) (2) 1,246 Residential mortgage backed securities 1,103 7 (66) — 1,162 Municipal bonds 256 1 (20) — 275 Total 23,553 275 (825) (28) 24,131 Short-term investments 2,063 1 (2) — 2,064 Total $ 25,616 $ 276 $ (827) $ (28) $ 26,195 December 31, 2022 Fixed maturities: Corporate bonds $ 8,020 $ 55 $ (781) $ (30) $ 8,776 U.S. government and government agencies 5,162 15 (343) — 5,490 Asset backed securities 1,927 1 (107) (6) 2,039 Non-U.S. government securities 2,313 9 (238) (2) 2,544 Commercial mortgage backed securities 1,047 1 (58) (3) 1,107 Residential mortgage backed securities 795 5 (87) — 877 Municipal bonds 419 3 (33) — 449 Total 19,683 89 (1,647) (41) 21,282 Short-term investments 1,332 1 (2) — 1,333 Total $ 21,015 $ 90 $ (1,649) $ (41) $ 22,615 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, 2023 Fixed maturities: Corporate bonds $ 1,559 $ (45) $ 4,959 $ (419) $ 6,518 $ (464) U.S. government and government agencies 1,066 (10) 941 (76) 2,007 (86) Non-U.S. government securities 365 (4) 897 (96) 1,262 (100) Residential mortgage backed securities 221 (3) 522 (63) 743 (66) Asset backed securities 234 (1) 1,112 (54) 1,346 (55) Commercial mortgage backed securities 100 (1) 909 (33) 1,009 (34) Municipal bonds 20 (1) 215 (19) 235 (20) Total 3,565 (65) 9,555 (760) 13,120 (825) Short-term investments 302 (2) — — 302 (2) Total $ 3,867 $ (67) $ 9,555 $ (760) $ 13,422 $ (827) December 31, 2022 Fixed maturities: Corporate bonds $ 4,823 $ (393) $ 2,559 $ (388) $ 7,382 $ (781) U.S. government and government agencies 3,557 (197) 1,443 (146) 5,000 (343) Non-U.S. government securities 1,703 (154) 542 (84) 2,245 (238) Residential mortgage backed securities 546 (52) 154 (35) 700 (87) Asset backed securities 1,148 (66) 512 (41) 1,660 (107) Commercial mortgage backed securities 598 (35) 445 (23) 1,043 (58) Municipal bonds 364 (30) 16 (3) 380 (33) Total 12,739 (927) 5,671 (720) 18,410 (1,647) Short-term investments 237 (2) — — 237 (2) Total $ 12,976 $ (929) $ 5,671 $ (720) $ 18,647 $ (1,649) At December 31, 2023, on a lot level basis, approximately 7,100 security lots out of a total of approximately 15,720 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 $6 million. The Company believes that such securities were temporarily impaired at December 31, 2023. At December 31, 2022, on a lot level basis, approximately 9,810 security lots out of a total of approximately 12,590 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 $7 million. The contractual maturities of the Company’s fixed maturities 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, 2023 December 31, 2022 Maturity Estimated Fair Value Amortized Cost Estimated Fair Value Amortized Cost Due in one year or less $ 480 $ 499 $ 511 $ 537 Due after one year through five years 12,924 13,101 11,016 11,715 Due after five years through 10 years 5,249 5,450 3,984 4,527 Due after 10 years 334 374 403 480 18,987 19,424 15,914 17,259 Mortgage backed securities 1,103 1,162 795 877 Commercial mortgage backed securities 1,213 1,246 1,047 1,107 Asset backed securities 2,250 2,299 1,927 2,039 Total $ 23,553 $ 24,131 $ 19,683 $ 21,282 Equity Securities, at Fair Value At December 31, 2023, the Company held $1.2 billion of equity securities, at fair value, compared to $860 million at December 31, 2022. Net Investment Income The components of net investment income were derived from the following sources: Year Ended December 31, 2023 2022 2021 Fixed maturities $ 917 $ 469 $ 331 Short-term investments 68 29 7 Equity securities 22 22 42 Term loans — — 30 Other (1) 93 47 68 Gross investment income 1,100 567 478 Investment expenses (77) (71) (89) Net investment income $ 1,023 $ 496 $ 389 (1) Includes interest income on operating cash, distributions from investment funds and other items. Net Realized Gains (Losses) Net realized gains (losses) were as follows: Year Ended December 31, 2023 2022 2021 Available for sale securities: Gross gains on investment sales $ 116 $ 81 $ 314 Gross losses on investment sales (547) (317) (157) Change in fair value of assets and liabilities accounted for using the fair value option: Fixed maturities 18 (71) 9 Other investments 27 (21) 117 Equity securities 1 (4) 13 Short-term investments — (3) 1 Equity securities, at fair value : Net realized gains (losses) on securities sold 61 75 123 Net unrealized gains (losses) on equity securities still held at reporting date 88 (267) 49 Allowance for credit losses: Investments related 3 (44) (1) Underwriting related (1) (13) — Derivative instruments (1) 59 (75) (33) Other (2) 10 (4) (55) Net realized gains (losses) $ (165) $ (663) $ 380 (1) See note 11, “Derivative Instruments” for information on the Company’s derivative instruments. (2) 2021 period reflected $33 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, 2023 2022 Other investments $ 1,777 $ 1,043 Fixed maturities 683 554 Equity securities 7 14 Short-term investments 21 33 Total other investments $ 2,488 $ 1,644 The following table summarizes the Company’s other investments, as detailed in the previous table, by strategy: December 31, 2023 2022 Lending 427 406 Investment grade fixed income 754 271 Term loan investments 272 164 Private equity 182 123 Credit related funds 124 56 Energy 18 23 Total $ 1,777 $ 1,043 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, 2023 2022 Credit related funds $ 1,258 $ 1,136 Private equity 1,175 917 Real estate 666 535 Lending 597 531 Infrastructure 320 245 Fixed income 277 130 Equities 178 169 Energy 95 111 Total $ 4,566 $ 3,774 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 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 $278 million for 2023, compared to $115 million for 2022 and $366 million for 2021. 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, 2023 2022 Invested assets $ 91,534 $ 74,961 Total assets 108,952 88,063 Total liabilities 33,901 27,553 Net assets $ 75,051 $ 60,510 Year Ended December 31, 2023 2022 2021 Total revenues $ 7,766 $ 12,305 $ 11,786 Total expenses 7,174 5,374 3,239 Net income (loss) $ 592 $ 6,931 $ 8,547 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. 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, 2023 2022 Investments accounted for using the equity method (1) $ 4,566 $ 3,774 Investments accounted for using the fair value option (2) 114 130 Total $ 4,680 $ 3,904 (1) Aggregate unfunded commitments were $3.4 billion at December 31, 2023, consistent with $2.6 billion at December 31, 2022. (2) Aggregate unfunded commitments were $32 million at December 31, 2023, compared to $17 million at December 31, 2022. 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 month lag, while the Company’s investment in Greysbridge is not recorded on a lag. 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 $75 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, 2023, the Company owned approximately 29.9% of the issued shares of Coface, or 30.1% excluding treasury shares, with a carrying value of $570 million, compared to $563 million at December 31, 2022. 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, 2023 the Company’s carrying value in Greysbridge was $430 million, compared to $306 million at December 31, 2022. The Company’s carrying value in Greysbridge reflected aggregate purchase price of $279 million along with income (loss) from operating affiliates, which included a one-time gain of $96 million recognized from the acquisition. See note 12, “Variable Interest Entity and Noncontrolling Interests.” The Company recorded income from operating affiliates of $184 million for 2023, compared to $75 million for 2022 and $264 million for 2021. 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, 2023 Structured Securities (1) Non-U.S. Government Securities Corporate Total Balance at beginning of period $ 9 $ 2 $ 30 $ 41 Additions for current-period provision for expected credit losses 2 — 5 7 Additions (reductions) for previously recognized expected credit losses (3) — (7) (10) Reductions due to disposals (1) (1) (8) (10) Balance at end of period $ 7 $ 1 $ 20 $ 28 Year Ended December 31, 2022 Balance at beginning of period $ 1 $ — $ 2 $ 3 Additions for current-period provision for expected credit losses 14 2 39 55 Additions (reductions) for previously recognized expected credit losses (4) — (9) (13) Reductions due to disposals (2) — (2) (4) Balance at end of period $ 9 $ 2 $ 30 $ 41 (1) Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities. Restricted Assets 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, 2023 2022 Assets used for collateral or guarantees: Affiliated transactions $ 4,854 $ 4,254 Third party agreements 2,869 2,633 Deposits with U.S. regulatory authorities 833 776 Other (1) 1,376 1,038 Total restricted assets $ 9,932 $ 8,701 (1) Primarily includes Funds at Lloyds, deposits with non-U.S. regulatory authorities and other restricted assets. Reconciliation of Cash and Restricted Cash The following table details reconciliation of cash and restricted cash within the Consolidated Balance Sheets: December 31, 2023 2022 2021 Cash $ 917 $ 855 $ 859 Restricted cash (included in ‘other assets’) 581 418 455 Cash and restricted cash $ 1,498 $ 1,273 $ 1,314 |
Fair Value
Fair Value | 12 Months Ended |
Dec. 31, 2023 | |
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 $29.6 billion of financial assets and liabilities measured at fair value at December 31, 2023, approximately $14 million, or 0.0%, were priced using non-binding broker-dealer quotes. Of the $23.8 billion of financial assets and liabilities measured at fair value at December 31, 2022, approximately $13 million, or 0.1%, 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. 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. Residential 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 certain short-term investments are generally determined using the spread above the risk-free yield curve and are classified within Level 2. Other short-term investments 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 short-term securities are unobservable, the fair value of such securities are classified as Level 3. 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. Other liabilities The Company’s other liabilities include contingent and deferred consideration liabilities related to the Company’s acquisitions. Contingent consideration liabilities 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 the future payments using an income approach based on modeled inputs which include a weighted average cost of capital. Deferred consideration liabilities are measured at fair value on the transaction date. The Company determined that contingent and deferred 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, 2023: 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 $ 10,855 $ — $ 10,708 $ 147 U.S. government and government agencies 5,814 5,792 22 — Asset backed securities 2,250 — 2,250 — Non-U.S. government securities 2,062 — 2,062 — Commercial mortgage backed securities 1,213 — 1,213 — Residential mortgage backed securities 1,103 — 1,103 — Municipal bonds 256 — 256 — Total 23,553 5,792 17,614 147 Short-term investments 2,063 1,786 193 84 Equity securities, at fair value 1,186 1,151 30 5 Derivative instruments (2) 197 — 197 — Residential mortgage loans 2 — 2 — Fair value option: Corporate bonds 662 — 662 — Non-U.S. government bonds 6 — 6 — Asset backed securities 2 — 2 — U.S. government and government agencies 13 13 — — Short-term investments 21 — 11 10 Equity securities 7 3 — 4 Other investments 316 — 210 106 Other investments measured at net asset value (1) 1,461 Total 2,488 16 891 120 Total assets measured at fair value $ 29,489 $ 8,745 $ 18,927 $ 356 Liabilities measured at fair value: Other liabilities $ (22) $ — $ — $ (22) Derivative instruments (2) (119) — (119) — Total liabilities measured at fair value $ (141) $ — $ (119) $ (22) (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) See note 11, “Derivative Instruments.” The following table presents the Company’s financial assets and liabilities measured at fair value by level at December 31, 2022: 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 $ 8,020 $ — $ 7,899 $ 121 U.S. government and government agencies 5,162 5,145 17 — Asset backed securities 1,927 — 1,927 — Non-U.S. government securities 2,313 — 2,313 — Commercial mortgage backed securities 1,047 — 1,047 — Residential mortgage backed securities 795 — 795 — Municipal bonds 419 — 419 — Total 19,683 5,145 14,417 121 Equity securities, at fair value 860 829 28 3 Short-term investments 1,332 1,198 134 — Derivative instruments (2) 149 — 149 — Residential mortgage loans 2 — 2 — Fair value option: Corporate bonds 543 — 543 — Non-U.S. government bonds 4 — 4 — Asset backed securities 2 — 2 — U.S. government and government agencies 5 5 — — Short-term investments 33 1 32 — Equity securities 14 10 — 4 Other investments 196 — 163 33 Other investments measured at net asset value (1) 847 Total 1,644 16 744 37 Total assets measured at fair value $ 23,670 $ 7,188 $ 15,474 $ 161 Liabilities measured at fair value: Other liabilities $ (14) $ — $ — $ (14) Derivative instruments (2) (76) — (76) — Total liabilities measured at fair value $ (90) $ — $ (76) $ (14) (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) See note 11, “Derivative Instruments.” 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 2023 and 2022: Assets Liabilities Available For Sale Fair Value Option Fair Value Structured Securities (1) Corporate Bonds Short-term Other Investments Short-term Equity Securities Equity Securities Other Year Ended December 31, 2023 Balance at beginning of year $ — $ 121 $ — $ 33 $ — $ 4 $ 4 $ (14) Total gains or (losses) (realized/unrealized) Included in earnings (2) — 1 — (5) — — — (1) Included in other comprehensive income — (1) — — — — — — Purchases, issuances, sales and settlements Purchases — 111 84 107 11 — 1 — Issuances — — — — — — — (9) Sales — — — (10) — — — — Settlements — (85) — (19) (1) — — 2 Transfers in and/or out of Level 3 — — — — — — — — Balance at end of year $ — $ 147 $ 84 $ 106 $ 10 $ 4 $ 5 $ (22) Year Ended December 31, 2022 Balance at beginning of year $ 3 $ — $ — $ 28 $ — $ 5 $ 3 $ (17) Total gains or (losses) (realized/unrealized) Included in earnings (2) (1) — — (1) — (1) — — Included in other comprehensive income — (1) — — — — — 1 Purchases, issuances, sales and settlements Purchases — 150 — 12 — — 1 — Issuances — — — — — — — — Sales (2) (6) — (3) — — — — Settlements — (26) — (3) — — — 2 Transfers in and/or out of Level 3 — 4 — — — — — — Balance at end of year $ — $ 121 $ — $ 33 $ — $ 4 $ 4 $ (14) (1) Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities. (2) Gains or losses were included in net realized gains (losses). 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, 2023, 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, 2023, 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 $2.5 billion. At December 31, 2022, 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 $2.4 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. Long-Lived Assets |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Dec. 31, 2023 | |
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 (1) Notional December 31, 2023 Futures contracts $ 139 $ (61) $ 3,746 Foreign currency forward contracts 27 (32) 1,224 Other (3) 31 (26) 512 Total $ 197 $ (119) December 31, 2022 Futures contracts $ 51 $ (17) $ 3,138 Foreign currency forward contracts 39 (35) 1,136 Other (3) 59 (24) 3,592 Total $ 149 $ (76) (1) The fair value of asset derivatives are included in ‘other assets’ and the fair value of liability derivatives are included in ‘other liabilities.’ (2) Represents the absolute notional value of all outstanding contracts, consisting of long and short positions. (3) Includes swaps, options and other derivatives contracts. The Company did not hold any derivatives which were designated as hedging instruments at December 31, 2023 or 2022. 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, 2023, $197 million and $119 million, respectively, of asset derivatives and liability derivatives were subject to a master netting agreement compared to $147 million and $73 million, respectively, at December 31, 2022. 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, 2023 2022 2021 Net realized gains (losses): Futures contracts $ 49 $ (86) $ (16) Foreign currency forward contracts 21 6 (40) Other (11) 5 23 Total $ 59 $ (75) $ (33) |
Variable Interest Entity and No
Variable Interest Entity and Noncontrolling Interests | 12 Months Ended |
Dec. 31, 2023 | |
Variable Interest Entity and Noncontrolling Interest Disclosure [Abstract] | |
Variable Interest Entity and Noncontrolling Interests | Somers Holdings Ltd. In March 2014, the Company invested $100 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. 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. 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 summarizes Somers’ cash flow from operating, investing and financing activities. Year Ended December 31, 2023 2022 2021 Total cash provided by (used for): Operating activities — — 47 Investing activities — — 96 Financing activities — — (2) Redeemable noncontrolling interests The following table sets forth activity in the redeemable noncontrolling interests: December 31, 2023 2022 2021 Balance, beginning of year $ 11 $ 9 $ 58 Impact of deconsolidation of Somers — — (49) Other (9) 2 — Balance, end of year $ 2 $ 11 $ 9 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, 2023 2022 2021 Amounts attributable to non-redeemable noncontrolling interests $ — $ — $ (78) Amounts attributable to redeemable noncontrolling interests 1 (6) (4) Net (income) loss attributable to noncontrolling interests $ 1 $ (6) $ (82) 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 reinsurance premium paid in regard to the Bellemeade Agreements is calculated by multiplying the outstanding reinsurance coverage amount at the beginning of the period by the coupon rate, which is the SOFR plus a contractual risk margin, less the actual investment income collected during the preceding month on the assets included in the underlying reinsurance trusts. In the event the assets included in the underlying reinsurance trusts (became severely impaired or worthless and the special purpose reinsurance companies were unable to meet their future obligations, the Company’s mortgage insurance subsidiaries would be liable to fulfill claim payments to policyholders. The Company’s maximum exposure to loss associated with these VIEs is determined as the amount of mortgage insurance claim payments on the insured policies, net of aggregate reinsurance payments previously received, up to the full aggregate excess of loss reinsurance coverage amounts. December 31, 2023 December 31, 2022 Bellemeade Entities Total VIE Assets Coverage Total VIE Assets 2017-1 Ltd. (Oct-17) $ — $ — $ 37 2018-1 Ltd. (Apr-18) (2) — — 90 2018-3 Ltd. (Oct-18) — — 199 2019-1 Ltd. (Mar-19) 71 — 108 2019-2 Ltd. (Apr-19) (2) — — 325 2019-3 Ltd. (Jul-19) 99 — 223 2019-4 Ltd. (Oct-19) (2) — — 266 2020-2 Ltd. (Sep-20) (2) — — 105 2020-3 Ltd. (Nov-20) (2) — — 244 2020-4 Ltd. (Dec-20) (2) — — 98 2021-1 Ltd. (Mar-21) (2) — — 467 2021-2 Ltd. (Jun-21) (2) — — 458 2021-3 Ltd. (Sep-21) 429 112 490 2022-1 Ltd. (Jan-22) 256 26 284 2022-2 Ltd. (Sep-22) 201 126 201 2023-1 Ltd. (Oct-23) 186 47 Total $ 1,242 $ 311 $ 3,595 (1) Coverage from a separate panel of reinsurers remaining at December 31, 2023. (2) Agreements terminated in the 2023 fourth quarter. |
Other Comprehensive Income
Other Comprehensive Income | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 Beginning balance $ (1,512) $ (134) $ (1,646) Other comprehensive income (loss) before reclassifications 547 23 570 Amounts reclassified from accumulated other comprehensive income 400 — 400 Net current period other comprehensive income (loss) 947 23 970 Ending balance $ (565) $ (111) $ (676) Year Ended December 31, 2022 Beginning balance $ 13 $ (78) $ (65) Other comprehensive income (loss) before reclassifications (1,772) (56) (1,828) Amounts reclassified from accumulated other comprehensive income 247 — 247 Net current period other comprehensive income (loss) (1,525) (56) (1,581) Ending balance $ (1,512) $ (134) $ (1,646) Year Ended December 31, 2021 Beginning balance $ 501 $ (12) $ 489 Other comprehensive income (loss) before reclassifications (371) (66) (437) Amounts reclassified from accumulated other comprehensive income (117) — (117) Net current period other comprehensive income (loss) (488) (66) (554) Ending balance $ 13 $ (78) $ (65) 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 2023 2022 2021 Unrealized appreciation on available-for-sale investments Net realized gains (losses) $ (431) $ (235) $ 157 Provision for credit losses 3 (44) (2) Total before tax (428) (279) 155 Income tax (expense) benefit 28 32 (38) Net of tax $ (400) $ (247) $ 117 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, 2023 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ 617 $ 70 $ 547 Less reclassification of net realized gains (losses) included in net income (428) (28) (400) Foreign currency translation adjustments 23 — 23 Other comprehensive income (loss) $ 1,068 $ 98 $ 970 Year Ended December 31, 2022 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ (2,009) $ (237) $ (1,772) Less reclassification of net realized gains (losses) included in net income (279) (32) (247) Foreign currency translation adjustments (56) — (56) Other comprehensive income (loss) $ (1,786) $ (205) $ (1,581) Year Ended December 31, 2021 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ (408) $ (22) $ (386) Less reclassification of net realized gains (losses) included in net income 155 38 117 Foreign currency translation adjustments (65) — (65) Other comprehensive income (loss) $ (628) $ (60) $ (568) |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 2022 2021 Numerator: Net income $ 4,442 $ 1,482 $ 2,239 Amounts attributable to noncontrolling interests 1 (6) (82) Net income available to Arch 4,443 1,476 2,157 Preferred dividends (40) (40) (48) Loss on redemption of preferred shares — — (15) Net income available to Arch common shareholders $ 4,403 $ 1,436 $ 2,094 Denominator: Weighted average common shares outstanding 368.7 368.6 391.7 Effect of dilutive common share equivalents: Nonvested restricted shares 2.5 2.1 2.0 Stock options (1) 7.6 6.9 6.6 Weighted average common shares and common share equivalents outstanding – diluted 378.8 377.6 400.3 Earnings per common share: Basic $ 11.94 $ 3.90 $ 5.35 Diluted $ 11.62 $ 3.80 $ 5.23 (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 2023, 2022 and 2021, the number of stock options excluded were 0.5 million, 0.8 million and 2.4 million, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
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 assuring 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. However, on December 27, 2023, the Government of Bermuda enacted the Bermuda CIT Act, which will become effective for tax years beginning on or after January 1, 2025. Given the potential for the new corporate income tax regime in Bermuda to supersede the Minister of Finance’s assurance, the Company is likely to become subject to taxes in Bermuda before March 31, 2035. The Bermuda CIT Act will apply a 15% corporate income tax to certain Bermuda constituent entities of multi-national groups in fiscal years beginning on or after January 1, 2025. The act includes a provision referred to as the economic transition adjustment, which is intended to provide a fair and equitable transition into the tax regime. Pursuant to this legislation, the Company recorded a $1.18 billion net deferred income tax asset in the fourth quarter of 2023, expected to be utilized predominantly over a 10-year period. The Company expects to incur and pay increased taxes in Bermuda beginning in 2025. 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. tax under an applicable income tax treaty with the U.S., or because a non-U.S. subsidiary has elected to be treated as a U.S. taxpayer. Arch Capital and its non-U.S. subsidiaries will be subject to a withholding tax on dividends from U.S. investments and interest from certain U.S. payors (subject to reduction by any applicable income tax treaty). Arch Capital and its non-U.S. subsidiaries intend to conduct their operations in a manner that will not cause them to be treated as engaged in a trade or business in the United States and, therefore, will not be required to pay U.S. federal income taxes (other than U.S. excise taxes on insurance and reinsurance premium and withholding taxes on dividends and certain other U.S. source investment income). However, because there is uncertainty as to the activities which constitute being engaged in a trade or business within the United States, there can be no assurances that the U.S. Internal Revenue Service will not contend successfully that Arch Capital, or its non-U.S. subsidiaries that do not elect to become U.S. taxpayers, are engaged in a trade or business in the United States. If Arch Capital or any of its non-U.S. subsidiaries were subject to U.S. income tax, Arch Capital’s shareholders’ equity and earnings could be materially adversely affected. Arch Capital has subsidiaries and branches that operate in various jurisdictions around the world that are subject to tax in the jurisdictions in which they operate. The significant jurisdictions in which Arch Capital’s subsidiaries and branches are subject to tax are the United States, United Kingdom, Ireland, Canada, Switzerland, Australia and Denmark. The components of income taxes attributable to operations were as follows: Year Ended December 31, 2023 2022 2021 Current expense (benefit): United States $ 251 $ 195 $ 284 Non-U.S. 37 6 11 288 201 295 Deferred expense (benefit): United States (20) (96) (123) Non-U.S. (1,141) (25) (44) (1,161) (121) (167) Income tax expense (benefit) $ (873) $ 80 $ 128 The Company’s income or loss before income taxes was earned in the following jurisdictions: Year Ended December 31, 2023 2022 2021 Income (Loss) Before Income Taxes: Bermuda $ 2,099 $ 986 $ 1,519 United States 1,239 401 643 Other 232 175 206 Total $ 3,570 $ 1,562 $ 2,368 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 2023 applicable statutory tax rates by jurisdiction were as follows: Bermuda (0.0%), United States (21.0%), United Kingdom (25.0%), Ireland (12.5%), Denmark (22.0%), Canada (26.5%), Gibraltar (12.5%), Australia (30.0%), Hong Kong (16.5%) and the Netherlands (25.8%). 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, 2023 2022 2021 Expected income tax expense (benefit) computed on pre-tax income at weighted average income tax rate $ 300 $ 110 $ 158 Addition (reduction) in income tax expense (benefit) resulting from: Investment income (14) (13) (24) State taxes, net of U.S. federal tax benefit 6 11 21 Dividend withholding taxes 9 11 12 Change in valuation allowance 4 (23) (40) Base eroding tax 9 8 — Share based compensation (13) (9) (5) Tax credits (3) (10) — Change in tax rate (1,179) (5) — Other 8 — 6 Income tax expense (benefit) $ (873) $ 80 $ 128 The effect of a change in tax laws or rates on deferred income 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, 2023 2022 Deferred income tax assets: Net operating loss $ 93 $ 77 Discounting of net loss reserves 219 78 Net unearned premium reserve 133 97 Compensation liabilities 64 55 Foreign tax credit carryforward 16 17 Goodwill and intangible assets 1,020 — Bad debt reserves 16 17 Depreciation and amortization 133 141 Lease liability 31 27 Net unrealized decline of investments 89 193 Lloyds year of account deferral — 1 Fair value adjustment to senior notes 41 — Other, net 13 11 Deferred income tax assets before valuation allowance 1,868 714 Valuation allowance (15) (7) Deferred income tax assets net of valuation allowance 1,853 707 Deferred income tax liabilities: Goodwill and intangibles — (39) Lloyds year of account deferral (13) — Contingency reserve (50) (44) Deferred policy acquisition costs (144) (64) Investment related (13) (9) Right-of-use asset (24) (21) Total deferred income tax liabilities (245) (177) Net deferred income tax assets $ 1,608 $ 530 The Company provides a valuation allowance to reduce the net value of certain deferred income tax assets to an amount which management expects to more likely than not be realized. As of December 31, 2023, the Company’s valuation allowance was $15 million, compared to $7 million at December 31, 2022. The valuation allowance at December 31, 2023, was primarily attributable to valuation allowances on the Company’s Australia, Gibraltar and Hong Kong operations and certain other deferred income tax assets relating to tax attributes that have a limited use. At December 31, 2023, the Company’s net operating loss carryforwards and tax credits were as follows: Year Ended December 31, 2023 Expiration Operating Loss Carryforwards United Kingdom $ 198 No expiration Ireland 24 No expiration Australia 47 No expiration Hong Kong 32 No expiration Gibraltar 24 No expiration Cyprus 1 No expiration United States (1) 78 2029 - 2038 Tax Credits U.K. foreign tax credits 10 No expiration U.S. foreign tax credits 6 2029 - 2033 (1) The Company’s U.S. operations have recorded $78 million of net operating loss (“NOL”) carryforwards that are subject to annual usage limitations under Section 382 of the Internal Revenue Code (“the Code”). The NOL limitations are related to acquisitions of the CMG entities in January 2014, Ventus Risk Management Inc. in August 2019, and Verifly Insurance Services, LLC, and Verifly USA Inc. in April 2023. In accordance with Section 382 of the Code, utilization of the acquired NOLs is limited to approximately $2 million per year through December 31, 2027, approximately $1 million through December 31, 2038, and $0.3 million thereafter. 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 $42 million at December 31, 2023, compared to $12 million at December 31, 2022. 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 does not intend 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, 2023, the Company’s total unrecognized tax benefits, including interest and penalties, were $2 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, 2023 2022 Balance at beginning of year $ 2 $ 2 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 $ 2 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 2019-2023 United Kingdom 2021-2023 Ireland 2018-2023 Canada 2019-2023 Switzerland 2019-2023 Denmark 2019-2023 Australia 2019-2023 As of December 31, 2023, the Company’s current income tax recoverable (included in “Other liabilities”) was $20 million. |
Transactions with Related Parti
Transactions with Related Parties | 12 Months Ended |
Dec. 31, 2023 | |
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 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 quota share reinsurance treaty on certain business written by Premia, and subsidiaries of Arch Capital are providing certain administrative and support services to Premia, in each case pursuant to separate multi-year agreements. During 2023, the Company entered into certain reinsurance transactions with Premia which generated net premiums written and earned of $80 million and $81 million, respectively, compared to $121 million and $120 million of net premiums written and earned, respectively in 2022. At December 31, 2023, the Company recorded a funds held asset from Premia of $158 million, compared to $119 million at December 31, 2022. 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, 2023 and December 31, 2022. In July 2021, following consummation of the Merger Agreement and the related Greysbridge equity financing, pursuant to which Somers became 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. During 2023 and 2022 periods, the Company entered into certain reinsurance transactions with Somers which reduced the Company’s net premiums written by $574 million and $519 million, respectively. In addition, Somers paid certain acquisition costs and administrative fees to the Company. At December 31, 2023, the Company recorded a reinsurance recoverable on unpaid and paid losses from Somers of $1.3 billion and a reinsurance balance payable to Somers of $475 million. At December 31, 2022, reinsurance recoverable on unpaid and paid losses from Somers was $1.2 billion, with a reinsurance balance payable to Somers of $414 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. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2023 | |
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 14 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, 2023 2022 Operating lease costs $ 33 $ 34 Sublease income (1) $ (2) $ (1) Cash payments included in the measurement of lease liabilities reported in operating cash flows $ 31 $ 26 Right-of-use assets obtained in exchange for new lease liabilities $ 28 $ 43 Right-of-use assets (2) $ 125 $ 123 Operating lease liability (2) $ 156 $ 152 Weighted average discount rate 4.7 % 4.2 % Weighted average remaining lease term 7.2 years 6.6 years (1) The sublease income primarily relates to office property in Raleigh, North Carolina. (2) The right-of-use assets are included in ‘ other assets other liabilities The following table presents the contractual maturities of the Company's operating lease liabilities at December 31, 2023: Years Ending December 31, 2024 $ 32 2025 27 2026 26 2027 22 2028 19 2029 and thereafter 60 Total undiscounted lease liability $ 186 Less: present value adjustment (30) Operating lease liability $ 156 Rental expense was approximately $38 million, $39 million and $37 million for 2023, 2022 and 2021, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 2022 2021 Marsh & McLennan Companies and its subsidiaries 19.0 % 17.3 % 18.3 % Aon Corporation and its subsidiaries 13.9 % 13.8 % 12.2 % No other broker and no one insured or reinsured accounted for more than 10% of gross premiums written for 2023, 2022 and 2021. 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, 2023 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 $3.6 billion and $2.9 billion at December 31, 2023 and 2022, 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 $148 million and $150 million at December 31, 2023 and 2022, respectively. Employment and Other Arrangements At December 31, 2023, 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, 2023 | |
Debt Disclosure [Abstract] | |
Debt and Financing Arrangements | The Company’s senior notes payable at December 31, 2023 and 2022 were as follows: Carrying Amount at Interest Principal December 31, (Fixed) Amount 2023 2022 2034 notes (1) 7.350 % $ 300 $ 298 $ 298 2043 notes (2) 5.144 % 500 495 495 2026 notes (3) 4.011 % 500 498 498 2046 notes (4) 5.031 % 450 446 445 2050 notes (5) 3.635 % 1,000 989 989 $ 2,750 $ 2,726 $ 2,725 (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”). 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. 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 August 23, 2023, Arch Capital and certain of its subsidiaries amended the existing credit agreement (the “Credit Facility”). The Credit Facility, as amended, consists of a $425 million secured facility for letters of credit (the “Secured Facility”) and a $500 million unsecured facility for revolving loans and letters of credit (the “Unsecured Facility”). At December 31, 2023, the Secured Facility had $273 million of letters of credit outstanding and remaining capacity of $152 million, and the Unsecured Facility had no outstanding revolving loans or letters of credit, with remaining capacity of $500 million. The Credit Facility contains certain restrictive and maintenance covenants customary for facilities of this type, including restrictions on indebtedness, minimum consolidated tangible net worth, maximum leverage 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, 2023. Obligations of each borrower for letters of credit under the Secured Facility are secured by cash and eligible securities of such borrower and held in collateral accounts. Commitments under the Credit Facility may be increased up to, but not exceeding, an aggregate of $1.5 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. Borrowings of revolving loans may be made at a variable rate based on Secured Overnight Financing Rate (“SOFR”). Secured letters of credit are available for issuance on behalf of certain Arch Capital subsidiaries. Arch Capital guarantees the obligations of Arch-U.S. and Arch U.S. MI Holdings Inc., Arch-U.S. guarantees the obligations of Arch Capital, and Arch Capital Finance LLC guarantees the obligations of Arch Capital and Arch-U.S. The commitments under the Credit Facility will expire on August 23, 2028, and all loans then outstanding under the Credit Facility must be repaid at such time. Letters of credit issued under the Credit Facility will not have an expiration date later than August 23, 2029. On September 27, 2023, Arch Re Bermuda a wholly-owned subsidiary of Arch Capital, entered as the borrower into a Letter of Credit Facility Agreement with Lloyds Bank Corporate Markets plc. Such agreement provides for a $175 million unsecured facility for letters of credit with commitments expiring on September 27, 2025. At December 31, 2023, this facility had $114 million of letters of credit outstanding and remaining capacity of $61 million. On October 25, 2023, Arch Re Bermuda entered into Amendment No. 3 and Joinder to a Letter of Credit Facility Agreement with Lloyds Bank Corporate Markets plc., which amends the agreement dated as of November 3, 2020, as amended on October 29, 2021 and as further amended on October 27, 2022. Such agreement provides for a $530 million facility for letters of credit in respect of Tier 2 Funds at Lloyds. As of December 31, 2023, $530 million face amount of letters of credit had been issued under this facility. The availability period ends on May 31, 2024. In addition, certain of Arch Capital’s subsidiaries had outstanding secured letters of credit through other facilities of $38 million, which were issued in the normal course of business (“LOC Facilities”). The principal purpose of the LOC Facilities is to issue, as required, evergreen standby letters of credit in favor of primary insurance or reinsurance counterparties with which certain of Arch Capital’s subsidiaries has entered into reinsurance arrangements. When issued, all secured letters of credit are secured by a portion of the investment portfolio. At December 31, 2023, these letters of credit were secured by investments with a fair value of $550 million. The Company had no outstanding revolving credit agreement borrowings at December 31, 2023 and 2022. Federal Home Loan Bank Membership |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2023 | |
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, 2021 $ 345 $ 71 $ 529 $ 945 Acquisitions (1) 8 — — 8 Amortization — — (106) (106) Foreign currency movements and other adjustments (11) (2) (30) (43) Net balance at Dec. 31, 2022 342 69 393 804 Acquisitions (1) — — 11 11 Amortization — — (95) (95) Impairment (2) — — (2) Foreign currency movements and other adjustments 5 1 7 13 Net balance at Dec. 31, 2023 $ 345 $ 70 $ 316 $ 731 Gross balance at Dec. 31, 2023 $ 348 $ 70 $ 1,105 $ 1,523 Accumulated amortization — — (766) (766) Foreign currency movements and other adjustments (3) — (23) (26) Net balance at Dec. 31, 2023 $ 345 $ 70 $ 316 $ 731 (1) See note 2, “Acquisitions.” The following table presents the components of goodwill and intangible assets: Gross Balance Accumulated Foreign Currency Translation Adjustment and Other Net Dec. 31, 2023 Acquired insurance contracts $ 452 $ (441) $ — $ 11 Operating platform 64 (54) — 10 Distribution relationships 594 (277) (23) 294 Goodwill 348 — (3) 345 Insurance licenses 48 — — 48 Syndicate capacity 22 — — 22 Unfavorable service contract (10) 10 — — Other 5 (4) — 1 Total $ 1,523 $ (766) $ (26) $ 731 Dec. 31, 2022 Acquired insurance contracts $ 452 $ (426) $ (1) $ 25 Operating platform 53 (50) — 3 Distribution relationships 602 (208) (31) 363 Goodwill 351 — (9) 342 Insurance licenses 48 — — 48 Syndicate capacity 22 — (1) 21 Unfavorable service contract (10) 10 — — Other 5 (3) — 2 Total $ 1,523 $ (677) $ (42) $ 804 The estimated remaining amortization expense for the Company’s intangible assets with finite lives is as follows: 2024 $ 77 2025 46 2026 34 2027 31 2028 29 2029 and thereafter 99 Total $ 316 one |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 2022 2021 Common Shares: Shares issued and outstanding, beginning of year 588.3 583.3 579.0 Shares issued (1) 2.8 3.5 2.7 Restricted shares issued, net of cancellations 0.8 1.5 1.6 Shares issued and outstanding, end of year 591.9 588.3 583.3 Common shares in treasury, end of year (218.5) (217.9) (204.4) Shares issued and outstanding, end of year 373.4 370.4 378.9 (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 (the “Board”) has authorized the investment in Arch Capital’s common shares through a share repurchase program. At December 31, 2023, $1.0 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, 2024. 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, 2023, Arch Capital held 218.5 million shares for an aggregate cost of $4.4 billion in treasury, at cost. The Company’s repurchases under the share repurchase program were as follows: Year Ended December 31, 2023 2022 2021 Aggregate cost of shares repurchased $ — $ 586 $ 1,234 Shares repurchased — 12.9 31.5 Average price per share repurchased $ — $ 45.44 $ 39.20 Since the inception of the share repurchase program through December 31, 2023, Arch Capital has repurchased approximately 433.6 million common shares for an aggregate purchase price of $5.9 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 Board 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 the Board 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, 2023 | |
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 2022 Long-Term Incentive and Share Award Plan (“the 2022 Plan”) became effective as of May 4, 2022 following approval by shareholders of the Company. The 2022 Plan provides for the issuance of stock options, stock appreciation rights, restricted shares, restricted share units payable in common shares or cash, dividend equivalents, performance shares and performance units and other share-based awards to Arch Capital’s eligible employees and directors. The number of common shares reserved for grants under the 2022 Plan, subject to anti-dilution adjustments in the event of certain changes in Arch Capital’s capital structure, is 9.0 million; provided that no more than 6.0 million common shares may be issued as incentive stock options under Section 422 of the Code. The 2022 Plan will terminate as to future awards on February 25, 2032. At December 31, 2023, 7.8 million shares are available for future issuance. 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 34.5 million common shares and will terminate as to future awards on February 28, 2028. At December 31, 2023, 5.8 million shares are available for future issuance. Upon shareholder approval on May 4, 2023, the Amended and Restated Arch Capital Group Ltd. 2007 Employee Share Purchase Plan (the “ESPP”) became effective. The total common shares that may be purchased under the ESPP was increased by 3.0 million shares for a total of 12.8 million shares authorized. The purpose of the ESPP is to give employees of the Company an opportunity to purchase common shares through payroll deductions, thereby encouraging employees to share in the economic growth and success of the Company. The ESPP is designed to qualify as an “employee share purchase plan” under Section 423 of the Internal Revenue Code of 1986, as amended. At December 31, 2023, 3.6 million 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 year period with one-third vesting on the first, second and third anniversaries of the grant date. 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, 2023 2022 2021 Dividend yield — % — % — % Expected volatility 25.1 % 24.0 % 24.2 % Risk free interest rate 4.1 % 2.0 % 1.0 % 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 2023 is presented below: Year Ended December 31, 2023 Number of Weighted Average Exercise Price Weighted Average Contractual Term Aggregate Intrinsic Value Outstanding, beginning of year 14,420,901 $ 28.17 Granted 479,760 $ 69.24 Exercised (2,355,729) $ 20.66 Forfeited or expired (8,339) $ 48.38 Outstanding, end of year 12,536,593 $ 31.14 4.10 $ 541 Exercisable, end of year 11,205,102 $ 28.68 3.61 $ 511 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 2023, the Company received proceeds of $20 million from the exercise of stock options and recognized a tax benefit of $9 million from the exercise of stock options and SARs. Year Ended December 31, 2023 2022 2021 Weighted average grant date fair value $ 23.50 $ 13.26 $ 9.22 Aggregate intrinsic value of Options/SARs exercised (in millions) $ 116 $ 113 $ 47 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 year period with one-third vesting on the first, second and third anniversaries of the grant date. A summary of restricted share and restricted unit activity under the Company’s Long Term Incentive and Share Award Plans for 2023 is presented below: Number of Restricted Common Shares Number of Restricted Unit Awards Unvested Shares: Unvested balance, beginning of year 2,165,554 517,293 Granted 678,657 146,534 Vested (1,281,449) (352,190) Forfeited (38,157) (5,709) Unvested balance, end of year 1,524,605 305,928 Weighted Average Grant Date Fair Value: Unvested balance, beginning of year $ 40.23 $ 37.17 Granted $ 69.47 $ 69.20 Vested $ 38.37 $ 34.16 Forfeited $ 49.65 $ 55.55 Unvested balance, end of year $ 54.57 $ 55.63 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, 2023 2022 2021 Number of restricted shares and restricted unit awards granted 825,191 1,089,393 1,261,773 Weighted average grant date fair value $ 69.42 $ 47.45 $ 36.12 Aggregate fair value of vested restricted share and unit awards (in millions) $ 122 $ 51 $ 41 The aggregate intrinsic value of restricted units outstanding at December 31, 2023 was $23 million, and the aggregate intrinsic value of restricted units vested and deferred was $0.4 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 performance periods. Final payouts depend on the level of achievement along with each employees continued service through the vest date, and can vary between 0% and 200%. The grant date fair value of the performance awards is measured using a Monte Carlo simulation model, which incorporated the assumptions summarized in the table below. Expected volatility is based on the Company’s daily historical trading data of its common shares. The cumulative compensation expense recognized and unrecognized as of any reporting period date represents the adjusted estimate of performance shares and units that will ultimately be awarded, valued at their original grant date fair values. Year Ended December 31, 2023 2022 2021 Expected volatility 30.4 % 38.1 % 37.5 % Risk free interest rate 4.6 % 1.7 % 0.3 % Number of Performance Shares Number of Performance Units Unvested Shares: Unvested balance, beginning of year 1,882,916 39,710 Granted 550,394 18,182 Performance adjustment (1) (2) (341,420) (2,024) Vested (207,486) (6,274) Forfeited (3,708) — Unvested balance, end of year 1,880,696 49,594 Weighted Average Grant Date Fair Value: Unvested balance, beginning of year $ 43.75 $ 45.33 Granted $ 74.08 $ 74.31 Performance adjustment (1) (2) $ 44.17 $ 44.17 Vested $ 44.17 $ 44.17 Forfeited $ 59.83 $ — Unvested balance, end of year $ 52.47 $ 56.15 (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, 2023 2022 2021 Number of performance awards 568,576 690,772 685,104 Weighted average grant date fair value $ 74.09 $ 49.91 $ 37.38 Aggregate fair value of vested performance share and unit awards (in millions) $ 14 $ 27 $ 24 The aggregate intrinsic value of performance units outstanding at December 31, 2023 was $4 million. 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, 2023 2022 2021 Pre-Tax Stock options and SARs $ 11 $ 12 $ 12 Restricted share and unit awards 54 50 47 Performance awards 23 22 24 ESPP 4 4 4 Total $ 92 $ 88 $ 87 After-Tax Stock options and SARs $ 10 $ 11 $ 11 Restricted share and unit awards 45 42 39 Performance awards 21 20 22 ESPP 4 4 4 Total $ 80 $ 77 $ 76 December 31, 2023 Stock Options and SARs Restricted Common Performance Common Shares and Units Unrecognized compensation cost related to unvested awards $ 7 $ 43 $ 11 Weighted average recognition period (years) 0.67 0.95 0.44 |
Retirement Plans
Retirement Plans | 12 Months Ended |
Dec. 31, 2023 | |
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 2023, 2022 and 2021, the Company expensed $77 million, $67 million and $60 million, respectively, related to these retirement plans. |
Legal Proceedings
Legal Proceedings | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023, 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, 2023 | |
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, 2023 and 2022: December 31, 2023 2022 Actual capital and surplus (1): Bermuda $ 24,120 $ 19,546 Ireland 1,148 968 United States 6,897 6,195 United Kingdom 1,367 1,018 Canada 83 69 Australia 366 285 Required capital and surplus: Bermuda $ 7,112 $ 6,450 Ireland 942 815 United States 1,895 1,749 United Kingdom 1,192 543 Canada 53 48 Australia 179 176 (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 income 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 2023, 2022 and 2021 was as follows: Year Ended December 31, 2023 2022 2021 Statutory net income (loss): Bermuda $ 3,519 $ 1,730 $ 2,371 Ireland 53 (53) 25 United States 592 220 346 United Kingdom 72 57 35 Canada 6 9 7 Australia 68 39 12 Bermuda The Company’s Bermuda insurance and reinsurance subsidiaries are subject to the Bermuda Insurance Act 1978 and related regulations, each as amended (the “Insurance Act”). Arch Re Bermuda, the Company’s principal reinsurance and insurance subsidiary, is registered as a Class 4 insurer and long-term insurer while Arch Group Reinsurance Ltd. (“AGRL”) is registered as a Class 3A general business insurer and provides affiliated quota share reinsurance covering certain U.S. business. The Insurance Act requires that both entities 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, 2023 and 2022, the actual and required capital and surplus were based on the economic balance sheet requirements. Under the Insurance Act, Arch Re Bermuda and AGRL are restricted with respect to the payment of dividends. Each entity 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 $4.8 billion to Arch Capital during 2024 without providing an affidavit to the BMA. Dividends or distributions, if any, made by AGRL would result in an increase in available capital at Arch-U.S. 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 (“CBI”) 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 CBI and must comply with Irish insurance acts and regulations as well as with directions and guidance issued by the CBI. Arch Re Europe and Arch Insurance (EU) are required to maintain a minimum level of capital. At December 31, 2023 and 2022, 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 $329 million of dividends during 2024 subject to the approval of the Commissioner of the Delaware Department of Insurance. AMIC and UGRIC are approved as eligible mortgage insurers by Fannie Mae and Freddie Mac, subject to maintaining certain requirements (“eligible mortgage insurers”). In April 2015, the GSEs published their original comprehensive, requirements, known as the Private Mortgage Insurer Eligibility Requirements or “PMIERs.” Revised and restated in September 2018, and clarified thereafter by the Guidance Letters 2020-1 and 2021-1 issued by the GSEs in 2020 and 2021, respectively, the PMIERs apply to the Company’s eligible mortgage insurers, but do not apply to AMG, which is not GSE-approved. The amount of assets required to satisfy the revised financial requirements of the PMIERs may be affected by many factors, including macro-economic conditions, the size and composition of our mortgage insurance portfolio, 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 regulation by their domiciliary and primary regulators, the Wisconsin Office of the Commissioner of Insurance (“Wisconsin OCI”) for AMIC and AMG, 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. Each company is subject to the statutory requirements of their domiciliary regulator as to payment of dividends and return of capital; the GSEs may also impart limitations on the Company’s eligible mortgage insurers, such as required minimum assets. Under respective state law, the Company’s U.S. mortgage subsidiaries can declare a maximum of approximately $180 million of ordinary dividends in 2024, however, dividend capacity is limited by the respective companies unassigned surplus amounts. Such dividends would increase the 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 require mortgage insurers to maintain a “minimum policyholder position” calculated in accordance with their respective regulations. Policyholders' position consists primarily of statutory policyholders' surplus plus the contingency loss reserves. 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. In May 2004, Arch Insurance (U.K.) was granted the relevant permissions for the classes of insurance business which it underwrites in the U.K. AMAL currently manages Arch Syndicate 2012 and Arch Syndicate 1955 pursuant to its authorizations by the U.K. regulators and Lloyd’s. All U.K. companies are also subject to a range of statutory provisions, including the laws and regulations of the Companies Act 2006 (as amended) (the “U.K. Companies Act”). 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, 2023 and 2022, these requirements were met. As corporate members of Lloyd’s, AMAL (as managing agent of the Company’s Lloyd’s Syndicates) 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. Under the Insurance Companies Act (Canada), approval of the Minister of Finance (Canada) is required in connection with certain acquisitions of shares of, or control of, Canadian insurance companies such as Arch Insurance Canada, and notice to and/or approval of OSFI is required in connection with the payment of dividends by or redemption of shares by Canadian insurance companies such as Arch Insurance Canada. 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 and since that date is the primary provider of lenders’ mortgage insurance for the group. Arch Indemnity has also been licensed by the Australian Securities and Investments Commission (“ASIC”) since March 2011 to engage in credit activities in Australia. Arch LMI Pty Ltd. (“Arch LMI”) was formerly authorized by APRA in January 2019 to conduct monoline lenders’ mortgage insurance business in Australia; however, in December 2022, we converted Arch LMI to a services company for our Australian lenders mortgage insurance operations and the company relinquished its APRA authorization. Major regulatory requirements that are applicable to Arch Indemnity in general as an insurance provider and financial institution in Australia include requirements and compliance with minimum capital levels; risk management strategy; corporate governance standards, privacy legislation on the collection, use and storage of personal information; cyber security obligations imposed by APRA and ASIC; modern slavery legislation; anti-money laundering and counter-terrorism legislation. At December 31, 2023 and 2022, 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. |
Schedule II - Condensed Financi
Schedule II - Condensed Financial Information of Registrant | 12 Months Ended |
Dec. 31, 2023 | |
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 millions) Balance Sheet (Parent Company Only) December 31, 2023 2022 Assets Total investments $ 17 $ 7 Cash 9 11 Investments in subsidiaries 19,590 14,191 Investment in operating affiliates 4 5 Due from subsidiaries and affiliates — 2 Other assets 58 18 Total assets $ 19,678 $ 14,234 Liabilities Senior notes $ 1,287 $ 1,287 Other liabilities 38 37 Total liabilities 1,325 1,324 Shareholders' Equity Non-cumulative preferred shares 830 830 Common shares ($0.0011 par, shares issued: 591.9 and 588.3) 1 1 Additional paid-in capital 2,327 2,211 Retained earnings 20,295 15,892 Accumulated other comprehensive income (loss), net of deferred income tax (676) (1,646) Common shares held in treasury, at cost (shares: 218.5 and 217.9) (4,424) (4,378) Total shareholders' equity $ 18,353 $ 12,910 Total liabilities and shareholders' equity $ 19,678 $ 14,234 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, 2023 2022 2021 Revenues Net investment income $ 2 $ 2 $ 2 Total revenues 2 2 2 Expenses Corporate expenses 93 86 72 Interest expense 59 59 59 Total expenses 152 145 131 Income (loss) before income taxes and income (loss) from operating affiliates (150) (143) (129) Income tax (expense) benefit 41 — — Income (loss) from operating affiliates (1) (1) (1) Income (loss) before equity in net income of subsidiaries (110) (144) (130) Equity in net income of subsidiaries 4,553 1,593 2,287 Net income available to Arch 4,443 1,449 2,157 Preferred dividends (40) (40) (48) Loss on redemption of preferred shares — — (15) Net income available to Arch common shareholders $ 4,403 $ 1,409 $ 2,094 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, 2023 2022 2021 Operating Activities: Net Cash Provided By Operating Activities $ 46 $ 621 $ 1,728 Investing Activities: Net (purchases) sales of short-term investments (8) (5) (2) Capital contributed to subsidiaries — — (487) Purchase of fixed assets — — (1) Other 1 (1) — Net Cash Used For Investing Activities (7) (6) (490) Financing Activities: Purchases of common shares under share repurchase program — (586) (1,234) Proceeds from common shares issued, net (2) 6 6 Proceeds from issuance of preferred shares, net — — 486 Redemption of preferred shares — — (450) Preferred dividends paid (40) (40) (48) Net Cash Used For Financing Activities (42) (620) (1,240) Increase (decrease) in cash and restricted cash (3) (5) (2) Cash and restricted cash, beginning of year 12 17 19 Cash and restricted cash, end of period $ 9 $ 12 $ 17 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, 2023 | |
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 millions) 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, 2023 Insurance $566 $12,250 $3,917 $5,446 NM $3,122 $1,055 $819 $5,862 Reinsurance 901 9,924 4,254 5,836 NM 3,227 1,240 288 6,554 Mortgage 64 578 637 1,158 NM (103) 17 194 1,052 Other Total $1,531 $22,752 $8,808 $12,440 NM $6,246 $2,312 $1,301 $13,468 December 31, 2022 Insurance $301 $11,017 $3,382 $4,560 NM $2,784 $887 $665 $5,021 Reinsurance 992 8,306 3,206 3,959 NM 2,568 813 268 4,924 Mortgage (30) 709 749 1,160 NM (324) 40 195 1,133 Other Total $1,263 $20,032 $7,337 $9,679 NM $5,028 $1,740 $1,128 $11,078 December 31, 2021 Insurance $378 $9,811 $2,938 $3,625 NM $2,345 $606 $559 $4,149 Reinsurance 424 6,879 2,263 2,841 NM 1,925 537 214 3,254 Mortgage 99 1,068 811 1,283 NM 57 97 193 1,261 Other 333 NM 258 63 33 353 Total $901 $17,758 $6,012 $8,082 NM $4,585 $1,303 $999 $9,017 (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, 2023 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | |
Reinsurance | SCHEDULE IV ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES REINSURANCE (U.S. dollars in millions) Gross Amount Ceded to Other Companies (1) Assumed From Other Companies (1) Net Percentage of Amount Assumed to Net Year Ended December 31, 2023 Premiums Written: Insurance $ 7,865 $ (2,049) $ 46 $ 5,862 0.8 % Reinsurance 626 (2,559) 8,487 6,554 129.5 % Mortgage 1,161 (335) 226 1,052 21.5 % Total $ 9,652 $ (4,935) $ 8,751 $ 13,468 65.0 % Year Ended December 31, 2022 Premiums Written: Insurance $ 6,889 $ (1,910) $ 42 $ 5,021 0.8 % Reinsurance 397 (2,024) 6,553 4,924 133.1 % Mortgage 1,256 (322) 199 1,133 17.6 % Total $ 8,542 $ (4,249) $ 6,785 $ 11,078 61.2 % Year Ended December 31, 2021 Premiums Written: Insurance $ 5,834 $ (1,719) $ 34 $ 4,149 0.8 % Reinsurance 409 (1,840) 4,685 3,254 144.0 % Mortgage 1,213 (247) 294 1,261 23.3 % Other 251 (105) 206 353 58.4 % Total $ 7,707 $ (3,735) $ 5,045 $ 9,017 55.9 % (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, 2023 | |
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 millions) 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 2023 $ 1,531 $ 22,752 $ 66 $ 8,808 $ 12,440 $ 1,023 $ 6,784 $ (538) $ 2,312 $ 4,093 $ 13,468 2022 1,263 20,032 61 7,337 9,679 496 5,797 (769) 1,740 3,141 11,078 2021 901 17,758 56 6,012 8,082 389 4,940 (355) 1,303 2,827 9,017 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||
Net income available to Arch | $ 4,443 | $ 1,476 | $ 2,157 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
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 (“AMG”), 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” and together with Arch Syndicate 2012, the Company’s “Lloyd’s Syndicates”). 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 income 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. Unearned premiums for the Company’s mortgage operations 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. 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. 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 2023, 2022 or 2021. |
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 or 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. 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 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 as an unrealized loss in other comprehensive income while the allowance for credit loss is charged to net realized gains (losses) in the consolidated statement of income. 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. 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 (losses)” 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 2023, 2022, and 2021, 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 based on estimates, and the ultimate net cost may vary from such estimates. The methods for making such estimates and for establishing the resulting liability are reviewed and updated using the most current information available. Any resulting adjustments, which may be material, are reflected in current operations. |
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 income 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. On December 27, 2023 the Bermuda government enacted tax legislation referred to as the Corporate Income Tax Act 2023 (“Bermuda CIT Act”). The Bermuda CIT Act establishes a 15% corporate income tax, for in-scope businesses, for fiscal years beginning on or after January 1, 2025. The enacted legislation includes a provision referred to as the Economic Transition Adjustment, which requires Bermuda Constituent entities to establish tax basis in their assets and liabilities, excluding goodwill, based on fair value as of September 30, 2023. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. See note 15, “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 year period with one-third vesting on the first, second and third anniversaries of the grant date and (ii) performance-based awards cliff vest after each 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 business combination 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. |
Funds held arrangements | Funds held arrangements are agreements with a third party reinsurance company, where the reinsured retains the related assets on a funds held basis. Such amounts are included in “Other assets” on the Company’s balance sheet. Investment returns produced by those assets are recorded as part of net investment income and net realized gains (losses) in the Company's consolidated results of operations. Funds held as collateral by the Company are included in “Other liabilities” and changes to the funds held liability are reflected as part of interest expense in the Company’s consolidated results of operations. |
Recent accounting pronouncements | 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 and amended in December 2022 with ASU 2022-06, “Reference Rate Reform (Topic 848)”. 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 discontinued because of reference rate reform. Along with the optional expedients, the amendments include a general principle that permits an entity to consider contract modifications due to reference reform to be an event that does not require contract re-measurement at the modification date or reassessment of a previous accounting determination. The amendment deferred the sunset date from December 31, 2022 to December 31, 2024. As a result, this standard can be adopted no later than December 31, 2024, with early adoption permitted. Based on its current analysis, the Company does not expect that the new guidance will have a material effect on the Company’s consolidated financial statements. ASU 2023-07, “Segment Reporting – Improvements to Reportable Segments Disclosures,” was issued in November 2023. This ASU enhances disclosures of significant segment expenses by requiring to disclose significant segment expenses regularly provided to the chief operating decision maker (“CODM”), extend certain annual disclosures to interim periods, and permit more than one measure of segment profit or loss to be reported under certain conditions. The amendments are effective for the Company in fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption of the amendment is permitted, including adoption in any interim periods for which financial statements have not been issued. Based on its current analysis, the Company does not expect that the new guidance will have a material effect on the Company’s consolidated financial statements. ASU 2023-09, “Improvements to Income Tax Disclosures,” was issued in December 2023 with the stated purpose of enhancing the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 address investor requests for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. While early adoption is permitted, a public entity should apply the amendments in ASU 2023-09 prospectively to all annual periods beginning after December 15, 2024. The Company is currently evaluating the impact of this standard on the Company’s consolidated financial statements and related disclosures. |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 7,911 $ 9,113 $ 1,387 $ 18,403 $ — $ 18,403 Premiums ceded (1) (2,049) (2,559) (335) (4,935) — (4,935) Net premiums written 5,862 6,554 1,052 13,468 — 13,468 Change in unearned premiums (416) (718) 106 (1,028) — (1,028) Net premiums earned 5,446 5,836 1,158 12,440 — 12,440 Other underwriting income — 17 14 31 — 31 Losses and loss adjustment expenses (3,122) (3,227) 103 (6,246) — (6,246) Acquisition expenses (1,055) (1,240) (17) (2,312) — (2,312) Other operating expenses (819) (288) (194) (1,301) — (1,301) Underwriting income $ 450 $ 1,098 $ 1,064 2,612 — 2,612 Net investment income 1,023 — 1,023 Net realized gains (losses) (165) — (165) Equity in net income (loss) of investments accounted for using the equity method 278 — 278 Other income (loss) 27 — 27 Corporate expenses (96) — (96) Transaction costs and other (6) — (6) Amortization of intangible assets (95) — (95) Interest expense (133) — (133) Net foreign exchange gains (losses) (60) — (60) Income (loss) before income taxes and income (loss) from operating affiliates 3,385 — 3,385 Income tax (expense) benefit 873 — 873 Income (loss) from operating affiliates 184 — 184 Net income (loss) 4,442 — 4,442 Amounts attributable to redeemable noncontrolling interests 1 — 1 Net income (loss) available to Arch 4,443 — 4,443 Preferred dividends (40) — (40) Net income (loss) available to Arch common shareholders $ 4,403 $ — $ 4,403 Underwriting Ratios Loss ratio 57.3 % 55.3 % -8.9 % 50.2 % — % 50.2 % Acquisition expense ratio 19.4 % 21.2 % 1.4 % 18.6 % — % 18.6 % Other operating expense ratio 15.0 % 4.9 % 16.8 % 10.5 % — % 10.5 % Combined ratio 91.7 % 81.4 % 9.3 % 79.3 % — % 79.3 % Goodwill and intangible assets $ 224 $ 130 $ 377 $ 731 $ — $ 731 Total investable assets $ 34,589 $ — $ 34,589 Total assets 58,906 — 58,906 Total liabilities 40,551 — 40,551 (1) Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations. Year Ended December 31, 2022 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 6,931 $ 6,948 $ 1,455 $ 15,327 $ — $ 15,327 Premiums ceded (1) (1,910) (2,024) (322) (4,249) — (4,249) Net premiums written 5,021 4,924 1,133 11,078 — 11,078 Change in unearned premiums (461) (965) 27 (1,399) — (1,399) Net premiums earned 4,560 3,959 1,160 9,679 — 9,679 Other underwriting income — 5 8 13 — 13 Losses and loss adjustment expenses (2,784) (2,568) 324 (5,028) — (5,028) Acquisition expenses, net (887) (813) (40) (1,740) — (1,740) Other operating expenses (665) (268) (195) (1,128) — (1,128) Underwriting income (loss) $ 224 $ 315 $ 1,257 1,796 — 1,796 Net investment income 496 — 496 Net realized gains (losses) (663) — (663) Equity in net income (loss) of investments accounted for using the equity method 115 — 115 Other income (loss) (27) — (27) Corporate expenses (95) — (95) Transaction costs and other — — — Amortization of intangible assets (106) — (106) Interest expense (131) — (131) Net foreign exchange gains (losses) 102 — 102 Income (loss) before income taxes and income (loss) from operating affiliates 1,487 — 1,487 Income tax (expense) benefit (80) — (80) Income (loss) from operating affiliates 75 — 75 Net income (loss) 1,482 — 1,482 Amounts attributable to redeemable noncontrolling interests (6) — (6) Net income (loss) available to Arch 1,476 — 1,476 Preferred dividends (40) — (40) Net income (loss) available to Arch common shareholders $ 1,436 $ — $ 1,436 Underwriting Ratios Loss ratio 61.0 % 64.9 % -28.0 % 51.9 % — % 51.9 % Acquisition expense ratio 19.4 % 20.5 % 3.5 % 18.0 % — % 18.0 % Other operating expense ratio 14.6 % 6.8 % 16.8 % 11.7 % — % 11.7 % Combined ratio 95.0 % 92.2 % -7.7 % 81.6 % — % 81.6 % Goodwill and intangible assets $ 229 $ 145 $ 430 $ 804 $ — $ 804 Total investable assets $ 28,065 $ — $ 28,065 Total assets 47,990 — 47,990 Total liabilities 35,069 — 35,069 (1) Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations. Year Ended December 31, 2021 Insurance Reinsurance Mortgage Sub-Total Other Total Gross premiums written (1) $ 5,868 $ 5,094 $ 1,508 $ 12,463 $ 458 $ 12,752 Premiums ceded (1) (1,719) (1,840) (247) (3,799) (105) (3,735) Net premiums written 4,149 3,254 1,261 8,664 353 9,017 Change in unearned premiums (524) (413) 22 (915) (20) (935) Net premiums earned 3,625 2,841 1,283 7,749 333 8,082 Other underwriting income — 3 18 21 — 21 Losses and loss adjustment expenses (2,345) (1,925) (57) (4,327) (258) (4,585) Acquisition expenses, net (606) (537) (97) (1,240) (63) (1,303) Other operating expenses (559) (214) (193) (966) (33) (999) Underwriting income (loss) $ 115 $ 168 $ 954 1,237 (21) 1,216 Net investment income 347 42 389 Net realized gains (losses) 299 81 380 Equity in net income (loss) of investments accounted for using the equity method 366 — 366 Other income (loss) 10 — 10 Corporate expenses (76) — (76) Transaction costs and other (1) (1) (2) Amortization of intangible assets (81) (1) (82) Interest expense (131) (8) (139) Net foreign exchange gains (losses) 42 (1) 41 Income (loss) before income taxes and income (loss) from operating affiliates 2,012 91 2,103 Income tax (expense) benefit (128) — (128) Income (loss) from operating affiliates 264 — 264 Net income 2,148 91 2,239 Amounts attributable to redeemable noncontrolling interests (2) (2) (4) Amounts attributable to nonredeemable noncontrolling interests — (78) (78) Net income (loss) available to Arch 2,148 9 2,157 Preferred dividends (48) — (48) Loss on redemption of preferred shares (15) — (15) Net income (loss) available to Arch common shareholders $ 2,085 $ 9 $ 2,094 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 $ 184 $ 505 $ 945 $ — $ 945 Total investable assets $ 27,442 $ — $ 27,442 Total assets 45,101 — 45,101 Total liabilities 31,546 — 31,546 (1) Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations. |
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, 2023 2022 2021 Net premiums earned (1) Professional lines $ 1,419 $ 1,314 $ 943 Property, energy, marine and aviation 1,064 772 668 Programs 658 590 507 Construction and national accounts 561 432 417 Travel, accident and health 557 492 256 Excess and surplus casualty 486 393 318 Warranty and lenders solutions 185 128 153 Other 516 439 363 Total $ 5,446 $ 4,560 $ 3,625 Net premiums written by underwriting location (1) United States $ 3,780 $ 3,342 $ 2,812 Europe 1,774 1,405 1,126 Other 308 274 211 Total $ 5,862 $ 5,021 $ 4,149 REINSURANCE SEGMENT Year Ended December 31, 2023 2022 2021 Net premiums earned (1) Other specialty $ 2,097 $ 1,378 $ 819 Property excluding property catastrophe 1,645 1,090 838 Casualty 1,005 855 667 Property catastrophe 742 367 280 Marine and aviation 229 159 153 Other 118 110 84 Total $ 5,836 $ 3,959 $ 2,841 Net premiums written by underwriting location (1) United States $ 1,756 $ 1,247 $ 829 Bermuda 3,288 2,561 1,555 Europe and other 1,510 1,116 870 Total $ 6,554 $ 4,924 $ 3,254 MORTGAGE SEGMENT Year Ended December 31, 2023 2022 2021 Net premiums earned U.S. primary mortgage insurance $ 759 $ 804 $ 953 U.S. credit risk transfer (CRT) and other 220 196 181 International mortgage insurance/reinsurance 179 160 149 Total $ 1,158 $ 1,160 $ 1,283 Net premiums written by underwriting location United States $ 743 $ 781 $ 913 Other 309 352 348 Total $ 1,052 $ 1,133 $ 1,261 (1) Segment results include intersegment transactions. OTHER SEGMENT Year Ended December 31, 2023 2022 2021 Net premiums earned (1) Casualty $ — $ — $ 138 Other specialty — — 118 Property catastrophe — — 15 Property excluding property catastrophe — — 7 Marine and aviation — — — Other — — 55 Total $ — $ — $ 333 Net premiums written by underwriting location (1) United States $ — $ — $ 63 Europe — — 91 Bermuda — — 199 Total $ — $ — $ 353 |
Reserve for Losses and Loss A_2
Reserve for Losses and Loss Adjustment Expenses (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 2022 2021 Reserve for losses and loss adjustment expenses at beginning of year $ 20,032 $ 17,757 $ 16,514 Unpaid losses and loss adjustment expenses recoverable 6,280 5,599 4,315 Net reserve for losses and loss adjustment expenses at beginning of year 13,752 12,158 12,199 Net incurred losses and loss adjustment expenses relating to losses occurring in: Current year 6,784 5,797 4,940 Prior years (538) (769) (355) Total net incurred losses and loss adjustment expenses 6,246 5,028 4,585 Net losses and loss adjustment expense reserves of acquired business (1) — — 104 Retroactive reinsurance transactions (2) — — (444) Impact of deconsolidation of Somers (3) — — (1,461) Foreign exchange (gains) losses and other 157 (293) 2 Net paid losses and loss adjustment expenses relating to losses occurring in: Current year (1,081) (888) (734) Prior years (3,012) (2,253) (2,093) Total net paid losses and loss adjustment expenses (4,093) (3,141) (2,827) Net reserve for losses and loss adjustment expenses at end of year 16,062 13,752 12,158 Unpaid losses and loss adjustment expenses recoverable 6,690 6,280 5,599 Reserve for losses and loss adjustment expenses at end of year $ 22,752 $ 20,032 $ 17,757 (1) Represents activity related to the Company’s acquisitions in the 2021 period. See note 2, “Acquisitions.” (2) See ‘Retroactive Reinsurance Transactions’ section. (3) See note 12, “Variable Interest Entity and Noncontrolling Interests.” |
Short Duration Contracts (Table
Short Duration Contracts (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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; warranty and lenders solutions; 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, 2023: December 31, 2023 Net outstanding liabilities Insurance Property, energy, marine and aviation $ 824 Third party occurrence business 3,601 Third party claims-made business 2,352 Multi-line and other specialty 1,348 Reinsurance Casualty 2,706 Property catastrophe 563 Property excluding property catastrophe 1,261 Marine and aviation 357 Other specialty 2,094 Mortgage U.S. primary 310 Other short duration lines not included in disclosures 284 Total for short duration lines 15,700 Unpaid losses and loss adjustment expenses recoverable Insurance Property, energy, marine and aviation 359 Third party occurrence business 2,025 Third party claims-made business 1,001 Multi-line and other specialty 246 Reinsurance Casualty 738 Property catastrophe 519 Property excluding property catastrophe 239 Marine and aviation 240 Other specialty 828 Mortgage U.S. primary 33 Other short duration lines not included in disclosures (1) 468 Intercompany eliminations (6) Total for short duration lines 6,690 Lines other than short duration 132 Discounting (66) Unallocated claims adjustment expenses 296 362 Reserve for losses and loss adjustment expenses $ 22,752 (1) Includes unpaid loss and loss adjustment expenses recoverable of $225 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 (in millions except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 148 $ 146 $ 147 $ 136 $ 132 $ 134 $ 135 $ 135 $ 134 $ 133 $ 2 3,871 2015 112 110 104 102 98 92 92 91 89 2 4,530 2016 104 101 105 100 96 92 88 88 — 6,171 2017 281 246 236 230 231 225 225 1 6,475 2018 181 186 174 170 170 172 5 5,077 2019 179 179 165 161 159 (1) 7,018 2020 359 329 336 333 9 8,212 2021 427 429 423 41 8,807 2022 522 495 74 13,274 2023 571 275 13,682 Total $ 2,688 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 26 $ 54 $ 78 $ 84 $ 88 $ 98 $ 115 $ 122 $ 123 $ 125 2015 24 65 76 86 88 86 87 88 86 2016 25 83 98 97 95 91 87 87 2017 30 140 196 212 216 218 220 2018 30 102 135 143 150 154 2019 26 105 134 139 148 2020 56 194 251 293 2021 90 268 343 2022 100 276 2023 146 Total 1,878 All outstanding liabilities before 2014, net of reinsurance 14 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 824 Third party occurrence business (in millions except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 330 $ 336 $ 339 $ 343 $ 339 $ 344 $ 343 $ 343 $ 345 $ 344 $ 49 75,679 2015 359 392 399 392 391 382 386 379 377 66 78,689 2016 390 394 406 399 375 368 363 352 77 78,883 2017 417 418 422 412 407 406 405 100 84,687 2018 430 453 451 451 459 462 127 78,320 2019 456 487 481 471 470 154 86,139 2020 607 616 640 632 226 92,279 2021 622 663 659 290 92,672 2022 688 726 513 92,564 2023 877 750 72,833 Total $ 5,304 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 9 $ 40 $ 71 $ 113 $ 162 $ 191 $ 211 $ 224 $ 237 $ 257 2015 11 45 88 139 182 212 227 249 268 2016 12 42 88 137 165 195 215 231 2017 13 52 100 135 165 221 247 2018 17 64 115 154 200 247 2019 18 73 122 173 214 2020 24 77 155 235 2021 26 91 174 2022 24 85 2023 32 Total 1,990 All outstanding liabilities before 2014, net of reinsurance 287 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 3,601 Third party claims-made business (in millions except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 264 $ 279 $ 299 $ 279 $ 281 $ 297 $ 291 $ 288 $ 296 $ 287 $ 14 14,494 2015 259 277 276 260 255 252 268 267 274 13 13,932 2016 275 291 308 314 322 327 330 327 18 14,912 2017 270 286 312 308 323 317 338 48 15,473 2018 273 314 320 336 347 367 44 17,098 2019 289 317 317 322 330 66 15,879 2020 383 413 423 446 118 15,239 2021 515 518 499 254 16,323 2022 669 655 448 18,563 2023 811 641 20,494 Total $ 4,334 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 14 $ 63 $ 129 $ 173 $ 207 $ 229 $ 243 $ 249 $ 260 $ 266 2015 9 52 100 126 174 193 217 221 242 2016 11 68 127 158 205 242 257 296 2017 9 68 113 143 196 233 258 2018 12 68 118 158 208 258 2019 12 65 122 155 197 2020 17 87 152 215 2021 23 90 163 2022 25 100 2023 64 Total 2,059 All outstanding liabilities before 2014, net of reinsurance 77 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 2,352 Multi-line and other specialty (in millions except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 302 $ 326 $ 318 $ 318 $ 317 $ 313 $ 310 $ 309 $ 311 $ 310 $ 4 148,702 2015 335 358 357 365 357 349 347 345 345 5 180,468 2016 409 431 428 416 410 408 409 406 7 192,955 2017 482 501 491 501 504 513 516 9 235,539 2018 512 565 563 565 565 565 14 260,995 2019 567 612 640 651 657 21 252,766 2020 618 569 515 517 44 166,357 2021 635 619 614 76 114,447 2022 678 642 157 143,264 2023 817 450 118,241 Total $ 5,389 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 108 $ 197 $ 234 $ 267 $ 281 $ 292 $ 293 $ 295 $ 296 $ 297 2015 138 236 278 306 321 327 330 331 333 2016 176 305 342 363 379 385 390 392 2017 181 342 381 423 446 472 480 2018 212 389 443 480 509 527 2019 212 386 487 549 577 2020 172 309 359 406 2021 157 335 428 2022 177 371 2023 254 Total 4,065 All outstanding liabilities before 2014, net of reinsurance 24 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 1,348 |
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, 2023: 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 20.5 % 43.7 % 18.1 % 6.0 % 2.2 % 1.0 % 2.6 % 1.9 % (0.4) % 1.5 % Third party occurrence business 3.5 % 9.4 % 11.5 % 11.4 % 9.9 % 9.8 % 5.6 % 4.6 % 4.4 % 5.6 % Third party claims-made business 4.1 % 15.5 % 16.5 % 11.1 % 14.3 % 10.1 % 6.3 % 5.2 % 5.7 % 2.0 % Multi-line and other specialty 34.0 % 29.3 % 11.3 % 8.2 % 4.5 % 2.9 % 1.1 % 0.4 % 0.4 % 0.5 % |
Reinsurance | |
Claims Development [Line Items] | |
Claims development tables | The following tables present information on the reinsurance segment’s short-duration insurance contracts: Casualty (in millions) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 215 $ 220 $ 217 $ 230 $ 227 $ 237 $ 237 $ 234 $ 234 $ 241 $ 33 N/A 2015 220 219 228 235 239 246 249 251 260 44 N/A 2016 212 224 247 262 269 268 272 281 45 N/A 2017 267 254 270 297 309 316 330 53 N/A 2018 276 289 281 286 298 308 50 N/A 2019 330 341 367 379 400 84 N/A 2020 382 371 354 372 163 N/A 2021 439 434 425 205 N/A 2022 547 527 390 N/A 2023 657 568 N/A Total $ 3,801 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 4 $ 16 $ 41 $ 63 $ 91 $ 114 $ 134 $ 145 $ 153 $ 160 2015 4 20 47 71 96 120 137 152 170 2016 6 26 52 87 113 132 157 172 2017 6 30 64 113 137 164 189 2018 8 31 106 129 155 182 2019 16 58 97 130 219 2020 18 50 90 132 2021 15 53 102 2022 18 61 2023 18 Total 1,405 All outstanding liabilities before 2014, net of reinsurance 310 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 2,706 Property catastrophe (in millions) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 44 $ 30 $ 25 $ 22 $ 20 $ 20 $ 19 $ 19 $ 19 $ 19 $ — N/A 2015 33 18 12 6 4 3 3 3 3 — N/A 2016 24 17 13 9 7 6 5 5 1 N/A 2017 86 54 50 36 24 21 22 (1) N/A 2018 71 49 30 17 8 5 3 N/A 2019 20 10 9 1 (7) 2 N/A 2020 269 333 337 326 17 N/A 2021 314 308 294 13 N/A 2022 303 295 41 N/A 2023 267 76 N/A Total $ 1,229 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 14 $ 20 $ 18 $ 19 $ 18 $ 19 $ 19 $ 19 $ 19 $ 19 2015 (3) (2) 2 2 2 2 2 2 2 2016 (7) 2 2 3 2 3 3 3 2017 31 32 37 27 14 16 17 2018 27 5 16 (13) (11) (9) 2019 4 7 11 (14) (13) 2020 56 158 207 249 2021 65 171 222 2022 70 169 2023 9 Total 668 All outstanding liabilities before 2014, net of reinsurance 2 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 563 Property excluding property catastrophe (in millions) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 142 $ 117 $ 98 $ 90 $ 88 $ 84 $ 82 $ 80 $ 79 $ 79 $ — N/A 2015 214 188 184 188 187 176 173 167 167 4 N/A 2016 175 145 137 135 139 136 130 130 6 N/A 2017 268 250 237 230 214 206 202 7 N/A 2018 224 239 235 212 202 203 7 N/A 2019 216 206 195 190 190 3 N/A 2020 368 340 320 320 15 N/A 2021 545 497 491 38 N/A 2022 742 668 119 N/A 2023 835 414 N/A Total $ 3,285 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 23 $ 62 $ 71 $ 76 $ 78 $ 78 $ 78 $ 78 $ 78 $ 78 2015 75 119 149 160 165 159 159 159 160 2016 33 94 98 104 111 114 115 115 2017 28 125 156 164 179 182 186 2018 30 108 152 167 175 177 2019 43 124 150 162 169 2020 101 207 243 267 2021 136 270 364 2022 143 361 2023 152 Total 2,029 All outstanding liabilities before 2014, net of reinsurance 5 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 1,261 Marine and aviation (in millions) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 31 $ 29 $ 27 $ 25 $ 23 $ 23 $ 22 $ 22 $ 19 $ 18 $ — N/A 2015 33 37 32 31 30 28 27 25 24 1 N/A 2016 27 23 23 19 17 15 12 11 3 N/A 2017 29 26 24 21 20 17 15 3 N/A 2018 27 26 24 24 21 21 3 N/A 2019 48 55 60 61 62 9 N/A 2020 83 76 79 80 10 N/A 2021 110 96 81 18 N/A 2022 126 138 59 N/A 2023 161 127 N/A Total $ 611 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 4 $ 8 $ 11 $ 12 $ 15 $ 15 $ 16 $ 16 $ 17 $ 17 2015 — 13 19 21 22 22 22 22 22 2016 (7) (2) — 3 6 7 7 7 2017 2 6 9 11 12 12 12 2018 2 7 11 13 14 15 2019 11 21 29 35 43 2020 9 26 42 60 2021 8 24 45 2022 12 37 2023 13 Total 271 All outstanding liabilities before 2014, net of reinsurance 17 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 357 Other specialty (in millions) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 337 $ 316 $ 318 $ 312 $ 307 $ 308 $ 304 $ 298 $ 296 $ 295 $ 1 N/A 2015 280 278 276 273 273 270 259 258 255 3 N/A 2016 326 323 316 307 314 309 306 307 6 N/A 2017 398 390 372 372 370 366 363 15 N/A 2018 416 409 404 428 424 423 29 N/A 2019 427 406 400 395 405 40 N/A 2020 593 524 519 539 61 N/A 2021 610 611 613 80 N/A 2022 953 935 225 N/A 2023 1,348 817 N/A Total $ 5,483 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 $ 96 $ 186 $ 229 $ 248 $ 258 $ 271 $ 275 $ 278 $ 280 $ 282 2015 83 162 197 211 224 236 239 240 241 2016 108 205 242 261 277 283 289 293 2017 136 256 298 313 326 337 346 2018 130 276 315 336 353 376 2019 121 211 277 303 325 2020 134 293 370 405 2021 152 311 432 2022 182 464 2023 244 Total 3,408 All outstanding liabilities before 2014, net of reinsurance 19 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 2,094 |
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, 2023: 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 2.8 % 7.7 % 12.1 % 10.4 % 11.4 % 8.5 % 7.8 % 5.3 % 5.2 % 2.9 % Property catastrophe 56.0 % (17.5) % 47.2 % (41.9) % (6.2) % 10.9 % 2.4 % 1.1 % (1.7) % — % Property excluding property catastrophe 25.0 % 38.2 % 14.2 % 6.0 % 4.4 % 0.2 % 0.7 % 0.1 % 0.4 % 0.4 % Marine and aviation 3.0 % 28.8 % 20.0 % 13.0 % 10.6 % 3.4 % 2.2 % 1.0 % 3.8 % 0.4 % Other specialty 28.6 % 29.9 % 13.9 % 5.7 % 4.5 % 3.9 % 1.7 % 0.9 % 0.6 % 1.0 % |
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 (in millions except claim count) Incurred losses and allocated loss adjustment expenses, net of reinsurance December 31, 2023 Total of IBNR liabilities plus expected development on reported claims Cumulative Year ended December 31, Accident year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 $ 316 $ 297 $ 279 $ 266 $ 266 $ 261 $ 263 $ 263 $ 261 $ 259 — 6,332 2015 223 197 198 195 189 191 191 189 188 — 4,588 2016 184 171 149 141 142 142 137 136 — 3,462 2017 179 132 107 108 109 102 99 — 2,541 2018 132 96 89 88 72 69 — 1,763 2019 108 119 110 63 51 — 1,149 2020 420 374 78 33 — 492 2021 144 77 20 — 211 2022 173 55 — 135 2023 182 1 9 Total $ 1,092 Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance 2014 20 129 202 234 247 254 256 257 257 258 2015 16 92 151 171 180 183 184 185 186 2016 11 72 113 127 131 132 132 133 2017 9 48 79 87 90 92 93 2018 4 31 50 56 59 60 2019 3 20 29 34 39 2020 1 4 8 13 2021 — 2 5 2022 — 3 2023 — Total 790 All outstanding liabilities before 2014, net of reinsurance 8 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 310 |
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, 2023: 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 5.1 % 29.1 % 24.2 % 10.7 % 4.7 % 1.8 % 0.7 % 0.5 % 0.2 % 0.1 % |
Allowance for Expected Credit_2
Allowance for Expected Credit Losses (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Credit Loss [Abstract] | |
Allowance for credit losses on 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, 2023 Premium Receivables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 3,625 $ 35 Change for provision of expected credit losses (1) (1) Balance at end of period $ 4,644 $ 34 Year Ended December 31, 2022 Balance at beginning of period $ 2,633 $ 40 Change for provision of expected credit losses (1) (5) Balance at end of period $ 3,625 $ 35 (1) Amounts deemed uncollectible are written-off in operating expenses. For the 2023 and 2022 periods, amounts written off totaled $3 million and $11 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, 2023 Reinsurance Recoverables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 6,564 $ 22 Change for provision of expected credit losses (1) Balance at end of period $ 7,064 $ 21 Year Ended December 31, 2022 Balance at beginning of period $ 5,881 $ 13 Change for provision of expected credit losses 9 Balance at end of period 6,564 $ 22 |
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, 2023 and 2022: December 31, 2023 2022 Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses $ 7,064 $ 6,564 % due from carriers with A.M. Best rating of “A-” or better 66.8 % 68.8 % % due from all other rated carriers 0.1 % 0.1 % % due from all other carriers with no A.M. Best rating (1) 33.1 % 31.1 % Largest balance due from any one carrier as % of total shareholders’ equity 7.2 % 9.0 % (1) At December 31, 2023 and 2022 period, over 95% of such amount were collateralized through reinsurance trusts, funds withheld arrangements, letters of credit or other, respectively. |
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, 2023 Contractholder Receivables, Net of Allowance Allowance for Expected Credit Losses Balance at beginning of period $ 1,731 $ 3 Change for provision of expected credit losses — Balance at end of period $ 1,814 $ 3 Year Ended December 31, 2022 Balance at beginning of period $ 1,829 $ 3 Change for provision of expected credit losses — Balance at end of period 1,731 $ 3 |
Reinsurance (Tables)
Reinsurance (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 2022 2021 Premiums Written Direct $ 9,652 $ 8,542 $ 7,707 Assumed 8,751 6,785 5,045 Ceded (4,935) (4,249) (3,735) Net $ 13,468 $ 11,078 $ 9,017 Premiums Earned Direct $ 9,131 $ 8,058 $ 7,150 Assumed 7,890 5,768 4,334 Ceded (4,581) (4,147) (3,402) Net $ 12,440 $ 9,679 $ 8,082 Losses and Loss Adjustment Expenses Direct $ 4,739 $ 3,991 $ 4,267 Assumed 3,975 3,558 2,826 Ceded (2,468) (2,521) (2,508) Net $ 6,246 $ 5,028 $ 4,585 |
Coverage and retention | The following table summarizes the respective coverages and retentions at December 31, 2023: Bellemeade Entities Initial Coverage at Issuance Current Remaining Retention, Net 2019-1 Ltd. (1) 342 71 134 2019-3 Ltd. (2) 701 99 218 2021-3 Ltd. (3) 639 541 134 2022-1 Ltd. (4) 317 282 141 2022-2 Ltd. (5) 327 327 205 2023-1 Ltd. (6) 233 233 185 Total $ 2,559 $ 1,553 $ 1,017 (1) 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. (2) Issued in July 2019, covering in-force policies issued in 2016. (3) 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. (4) Issued in January 2022, covering in-force policies issued between July 1, 2021 and November 30, 2021. $284 million was directly funded by Bellemeade Re 2022-1 Ltd. via insurance-linked notes, with an additional $33 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers . (5) Issued in September 2022, covering in-force policies issued between November 1, 2021 and June 30, 2022. $201 million was directly funded by Bellemeade Re 2022-2 Ltd. via insurance-linked notes, with an additional $126 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers. (6) Issued in October 2023, covering in-force policies issued between January 1, 2023 and September 30, 2023. $187 million was directly funded by Bellemeade Re 2023-1 Ltd. via insurance-linked notes, with an additional $47 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, 2023 | |
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 Cost or December 31, 2023 Fixed maturities: Corporate bonds $ 10,855 $ 157 $ (464) $ (20) $ 11,182 U.S. government and government agencies 5,814 63 (86) — 5,837 Asset backed securities 2,250 11 (55) (5) 2,299 Non-U.S. government securities 2,062 33 (100) (1) 2,130 Commercial mortgage backed securities 1,213 3 (34) (2) 1,246 Residential mortgage backed securities 1,103 7 (66) — 1,162 Municipal bonds 256 1 (20) — 275 Total 23,553 275 (825) (28) 24,131 Short-term investments 2,063 1 (2) — 2,064 Total $ 25,616 $ 276 $ (827) $ (28) $ 26,195 December 31, 2022 Fixed maturities: Corporate bonds $ 8,020 $ 55 $ (781) $ (30) $ 8,776 U.S. government and government agencies 5,162 15 (343) — 5,490 Asset backed securities 1,927 1 (107) (6) 2,039 Non-U.S. government securities 2,313 9 (238) (2) 2,544 Commercial mortgage backed securities 1,047 1 (58) (3) 1,107 Residential mortgage backed securities 795 5 (87) — 877 Municipal bonds 419 3 (33) — 449 Total 19,683 89 (1,647) (41) 21,282 Short-term investments 1,332 1 (2) — 1,333 Total $ 21,015 $ 90 $ (1,649) $ (41) $ 22,615 |
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, 2023 Fixed maturities: Corporate bonds $ 1,559 $ (45) $ 4,959 $ (419) $ 6,518 $ (464) U.S. government and government agencies 1,066 (10) 941 (76) 2,007 (86) Non-U.S. government securities 365 (4) 897 (96) 1,262 (100) Residential mortgage backed securities 221 (3) 522 (63) 743 (66) Asset backed securities 234 (1) 1,112 (54) 1,346 (55) Commercial mortgage backed securities 100 (1) 909 (33) 1,009 (34) Municipal bonds 20 (1) 215 (19) 235 (20) Total 3,565 (65) 9,555 (760) 13,120 (825) Short-term investments 302 (2) — — 302 (2) Total $ 3,867 $ (67) $ 9,555 $ (760) $ 13,422 $ (827) December 31, 2022 Fixed maturities: Corporate bonds $ 4,823 $ (393) $ 2,559 $ (388) $ 7,382 $ (781) U.S. government and government agencies 3,557 (197) 1,443 (146) 5,000 (343) Non-U.S. government securities 1,703 (154) 542 (84) 2,245 (238) Residential mortgage backed securities 546 (52) 154 (35) 700 (87) Asset backed securities 1,148 (66) 512 (41) 1,660 (107) Commercial mortgage backed securities 598 (35) 445 (23) 1,043 (58) Municipal bonds 364 (30) 16 (3) 380 (33) Total 12,739 (927) 5,671 (720) 18,410 (1,647) Short-term investments 237 (2) — — 237 (2) Total $ 12,976 $ (929) $ 5,671 $ (720) $ 18,647 $ (1,649) |
Contractual maturities of the Company's fixed maturities and fixed maturities pledged under securities lending arrangements | December 31, 2023 December 31, 2022 Maturity Estimated Fair Value Amortized Cost Estimated Fair Value Amortized Cost Due in one year or less $ 480 $ 499 $ 511 $ 537 Due after one year through five years 12,924 13,101 11,016 11,715 Due after five years through 10 years 5,249 5,450 3,984 4,527 Due after 10 years 334 374 403 480 18,987 19,424 15,914 17,259 Mortgage backed securities 1,103 1,162 795 877 Commercial mortgage backed securities 1,213 1,246 1,047 1,107 Asset backed securities 2,250 2,299 1,927 2,039 Total $ 23,553 $ 24,131 $ 19,683 $ 21,282 |
Components of net investment income | The components of net investment income were derived from the following sources: Year Ended December 31, 2023 2022 2021 Fixed maturities $ 917 $ 469 $ 331 Short-term investments 68 29 7 Equity securities 22 22 42 Term loans — — 30 Other (1) 93 47 68 Gross investment income 1,100 567 478 Investment expenses (77) (71) (89) Net investment income $ 1,023 $ 496 $ 389 (1) Includes interest income on operating cash, distributions from investment funds and other items. |
Summary of net realized gains (losses) | Net realized gains (losses) were as follows: Year Ended December 31, 2023 2022 2021 Available for sale securities: Gross gains on investment sales $ 116 $ 81 $ 314 Gross losses on investment sales (547) (317) (157) Change in fair value of assets and liabilities accounted for using the fair value option: Fixed maturities 18 (71) 9 Other investments 27 (21) 117 Equity securities 1 (4) 13 Short-term investments — (3) 1 Equity securities, at fair value : Net realized gains (losses) on securities sold 61 75 123 Net unrealized gains (losses) on equity securities still held at reporting date 88 (267) 49 Allowance for credit losses: Investments related 3 (44) (1) Underwriting related (1) (13) — Derivative instruments (1) 59 (75) (33) Other (2) 10 (4) (55) Net realized gains (losses) $ (165) $ (663) $ 380 (1) See note 11, “Derivative Instruments” for information on the Company’s derivative instruments. (2) 2021 period reflected $33 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, 2023 2022 Other investments $ 1,777 $ 1,043 Fixed maturities 683 554 Equity securities 7 14 Short-term investments 21 33 Total other investments $ 2,488 $ 1,644 The following table summarizes the Company’s other investments, as detailed in the previous table, by strategy: December 31, 2023 2022 Lending 427 406 Investment grade fixed income 754 271 Term loan investments 272 164 Private equity 182 123 Credit related funds 124 56 Energy 18 23 Total $ 1,777 $ 1,043 |
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, 2023 2022 Credit related funds $ 1,258 $ 1,136 Private equity 1,175 917 Real estate 666 535 Lending 597 531 Infrastructure 320 245 Fixed income 277 130 Equities 178 169 Energy 95 111 Total $ 4,566 $ 3,774 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, 2023 2022 Invested assets $ 91,534 $ 74,961 Total assets 108,952 88,063 Total liabilities 33,901 27,553 Net assets $ 75,051 $ 60,510 Year Ended December 31, 2023 2022 2021 Total revenues $ 7,766 $ 12,305 $ 11,786 Total expenses 7,174 5,374 3,239 Net income (loss) $ 592 $ 6,931 $ 8,547 |
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, 2023 2022 Investments accounted for using the equity method (1) $ 4,566 $ 3,774 Investments accounted for using the fair value option (2) 114 130 Total $ 4,680 $ 3,904 (1) Aggregate unfunded commitments were $3.4 billion at December 31, 2023, consistent with $2.6 billion at December 31, 2022. |
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, 2023 Structured Securities (1) Non-U.S. Government Securities Corporate Total Balance at beginning of period $ 9 $ 2 $ 30 $ 41 Additions for current-period provision for expected credit losses 2 — 5 7 Additions (reductions) for previously recognized expected credit losses (3) — (7) (10) Reductions due to disposals (1) (1) (8) (10) Balance at end of period $ 7 $ 1 $ 20 $ 28 Year Ended December 31, 2022 Balance at beginning of period $ 1 $ — $ 2 $ 3 Additions for current-period provision for expected credit losses 14 2 39 55 Additions (reductions) for previously recognized expected credit losses (4) — (9) (13) Reductions due to disposals (2) — (2) (4) Balance at end of period $ 9 $ 2 $ 30 $ 41 (1) Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities. |
Summary of restricted assets | The following table details the value of the Company’s restricted assets: December 31, 2023 2022 Assets used for collateral or guarantees: Affiliated transactions $ 4,854 $ 4,254 Third party agreements 2,869 2,633 Deposits with U.S. regulatory authorities 833 776 Other (1) 1,376 1,038 Total restricted assets $ 9,932 $ 8,701 (1) Primarily includes Funds at Lloyds, deposits with non-U.S. regulatory authorities and other restricted assets. |
Reconciliation of cash and restricted cash | The following table details reconciliation of cash and restricted cash within the Consolidated Balance Sheets: December 31, 2023 2022 2021 Cash $ 917 $ 855 $ 859 Restricted cash (included in ‘other assets’) 581 418 455 Cash and restricted cash $ 1,498 $ 1,273 $ 1,314 |
Fair Value (Tables)
Fair Value (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023: 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 $ 10,855 $ — $ 10,708 $ 147 U.S. government and government agencies 5,814 5,792 22 — Asset backed securities 2,250 — 2,250 — Non-U.S. government securities 2,062 — 2,062 — Commercial mortgage backed securities 1,213 — 1,213 — Residential mortgage backed securities 1,103 — 1,103 — Municipal bonds 256 — 256 — Total 23,553 5,792 17,614 147 Short-term investments 2,063 1,786 193 84 Equity securities, at fair value 1,186 1,151 30 5 Derivative instruments (2) 197 — 197 — Residential mortgage loans 2 — 2 — Fair value option: Corporate bonds 662 — 662 — Non-U.S. government bonds 6 — 6 — Asset backed securities 2 — 2 — U.S. government and government agencies 13 13 — — Short-term investments 21 — 11 10 Equity securities 7 3 — 4 Other investments 316 — 210 106 Other investments measured at net asset value (1) 1,461 Total 2,488 16 891 120 Total assets measured at fair value $ 29,489 $ 8,745 $ 18,927 $ 356 Liabilities measured at fair value: Other liabilities $ (22) $ — $ — $ (22) Derivative instruments (2) (119) — (119) — Total liabilities measured at fair value $ (141) $ — $ (119) $ (22) (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) See note 11, “Derivative Instruments.” The following table presents the Company’s financial assets and liabilities measured at fair value by level at December 31, 2022: 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 $ 8,020 $ — $ 7,899 $ 121 U.S. government and government agencies 5,162 5,145 17 — Asset backed securities 1,927 — 1,927 — Non-U.S. government securities 2,313 — 2,313 — Commercial mortgage backed securities 1,047 — 1,047 — Residential mortgage backed securities 795 — 795 — Municipal bonds 419 — 419 — Total 19,683 5,145 14,417 121 Equity securities, at fair value 860 829 28 3 Short-term investments 1,332 1,198 134 — Derivative instruments (2) 149 — 149 — Residential mortgage loans 2 — 2 — Fair value option: Corporate bonds 543 — 543 — Non-U.S. government bonds 4 — 4 — Asset backed securities 2 — 2 — U.S. government and government agencies 5 5 — — Short-term investments 33 1 32 — Equity securities 14 10 — 4 Other investments 196 — 163 33 Other investments measured at net asset value (1) 847 Total 1,644 16 744 37 Total assets measured at fair value $ 23,670 $ 7,188 $ 15,474 $ 161 Liabilities measured at fair value: Other liabilities $ (14) $ — $ — $ (14) Derivative instruments (2) (76) — (76) — Total liabilities measured at fair value $ (90) $ — $ (76) $ (14) (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) See note 11, “Derivative Instruments.” |
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 2023 and 2022: Assets Liabilities Available For Sale Fair Value Option Fair Value Structured Securities (1) Corporate Bonds Short-term Other Investments Short-term Equity Securities Equity Securities Other Year Ended December 31, 2023 Balance at beginning of year $ — $ 121 $ — $ 33 $ — $ 4 $ 4 $ (14) Total gains or (losses) (realized/unrealized) Included in earnings (2) — 1 — (5) — — — (1) Included in other comprehensive income — (1) — — — — — — Purchases, issuances, sales and settlements Purchases — 111 84 107 11 — 1 — Issuances — — — — — — — (9) Sales — — — (10) — — — — Settlements — (85) — (19) (1) — — 2 Transfers in and/or out of Level 3 — — — — — — — — Balance at end of year $ — $ 147 $ 84 $ 106 $ 10 $ 4 $ 5 $ (22) Year Ended December 31, 2022 Balance at beginning of year $ 3 $ — $ — $ 28 $ — $ 5 $ 3 $ (17) Total gains or (losses) (realized/unrealized) Included in earnings (2) (1) — — (1) — (1) — — Included in other comprehensive income — (1) — — — — — 1 Purchases, issuances, sales and settlements Purchases — 150 — 12 — — 1 — Issuances — — — — — — — — Sales (2) (6) — (3) — — — — Settlements — (26) — (3) — — — 2 Transfers in and/or out of Level 3 — 4 — — — — — — Balance at end of year $ — $ 121 $ — $ 33 $ — $ 4 $ 4 $ (14) (1) Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities. (2) Gains or losses were included in net realized gains (losses). |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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 (1) Notional December 31, 2023 Futures contracts $ 139 $ (61) $ 3,746 Foreign currency forward contracts 27 (32) 1,224 Other (3) 31 (26) 512 Total $ 197 $ (119) December 31, 2022 Futures contracts $ 51 $ (17) $ 3,138 Foreign currency forward contracts 39 (35) 1,136 Other (3) 59 (24) 3,592 Total $ 149 $ (76) (1) The fair value of asset derivatives are included in ‘other assets’ and the fair value of liability derivatives are included in ‘other liabilities.’ (2) Represents the absolute notional value of all outstanding contracts, consisting of long and short positions. (3) Includes swaps, options and other derivatives contracts. |
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, 2023 2022 2021 Net realized gains (losses): Futures contracts $ 49 $ (86) $ (16) Foreign currency forward contracts 21 6 (40) Other (11) 5 23 Total $ 59 $ (75) $ (33) |
Variable Interest Entity and _2
Variable Interest Entity and Noncontrolling Interests (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Variable Interest Entity and Noncontrolling Interest Disclosure [Abstract] | |
Summary of VIE cash flows | The following table summarizes Somers’ cash flow from operating, investing and financing activities. Year Ended December 31, 2023 2022 2021 Total cash provided by (used for): Operating activities — — 47 Investing activities — — 96 Financing activities — — (2) |
Activity in redeemable noncontrolling interest | The following table sets forth activity in the redeemable noncontrolling interests: December 31, 2023 2022 2021 Balance, beginning of year $ 11 $ 9 $ 58 Impact of deconsolidation of Somers — — (49) Other (9) 2 — Balance, end of year $ 2 $ 11 $ 9 |
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, 2023 2022 2021 Amounts attributable to non-redeemable noncontrolling interests $ — $ — $ (78) Amounts attributable to redeemable noncontrolling interests 1 (6) (4) Net (income) loss attributable to noncontrolling interests $ 1 $ (6) $ (82) |
Total assets and maximum loss exposure of VIE | December 31, 2023 December 31, 2022 Bellemeade Entities Total VIE Assets Coverage Total VIE Assets 2017-1 Ltd. (Oct-17) $ — $ — $ 37 2018-1 Ltd. (Apr-18) (2) — — 90 2018-3 Ltd. (Oct-18) — — 199 2019-1 Ltd. (Mar-19) 71 — 108 2019-2 Ltd. (Apr-19) (2) — — 325 2019-3 Ltd. (Jul-19) 99 — 223 2019-4 Ltd. (Oct-19) (2) — — 266 2020-2 Ltd. (Sep-20) (2) — — 105 2020-3 Ltd. (Nov-20) (2) — — 244 2020-4 Ltd. (Dec-20) (2) — — 98 2021-1 Ltd. (Mar-21) (2) — — 467 2021-2 Ltd. (Jun-21) (2) — — 458 2021-3 Ltd. (Sep-21) 429 112 490 2022-1 Ltd. (Jan-22) 256 26 284 2022-2 Ltd. (Sep-22) 201 126 201 2023-1 Ltd. (Oct-23) 186 47 Total $ 1,242 $ 311 $ 3,595 (1) Coverage from a separate panel of reinsurers remaining at December 31, 2023. (2) Agreements terminated in the 2023 fourth quarter. |
Other Comprehensive Income (Tab
Other Comprehensive Income (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 Beginning balance $ (1,512) $ (134) $ (1,646) Other comprehensive income (loss) before reclassifications 547 23 570 Amounts reclassified from accumulated other comprehensive income 400 — 400 Net current period other comprehensive income (loss) 947 23 970 Ending balance $ (565) $ (111) $ (676) Year Ended December 31, 2022 Beginning balance $ 13 $ (78) $ (65) Other comprehensive income (loss) before reclassifications (1,772) (56) (1,828) Amounts reclassified from accumulated other comprehensive income 247 — 247 Net current period other comprehensive income (loss) (1,525) (56) (1,581) Ending balance $ (1,512) $ (134) $ (1,646) Year Ended December 31, 2021 Beginning balance $ 501 $ (12) $ 489 Other comprehensive income (loss) before reclassifications (371) (66) (437) Amounts reclassified from accumulated other comprehensive income (117) — (117) Net current period other comprehensive income (loss) (488) (66) (554) Ending balance $ 13 $ (78) $ (65) |
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 2023 2022 2021 Unrealized appreciation on available-for-sale investments Net realized gains (losses) $ (431) $ (235) $ 157 Provision for credit losses 3 (44) (2) Total before tax (428) (279) 155 Income tax (expense) benefit 28 32 (38) Net of tax $ (400) $ (247) $ 117 |
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, 2023 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ 617 $ 70 $ 547 Less reclassification of net realized gains (losses) included in net income (428) (28) (400) Foreign currency translation adjustments 23 — 23 Other comprehensive income (loss) $ 1,068 $ 98 $ 970 Year Ended December 31, 2022 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ (2,009) $ (237) $ (1,772) Less reclassification of net realized gains (losses) included in net income (279) (32) (247) Foreign currency translation adjustments (56) — (56) Other comprehensive income (loss) $ (1,786) $ (205) $ (1,581) Year Ended December 31, 2021 Unrealized appreciation (decline) in value of investments: Unrealized holding gains (losses) arising during period $ (408) $ (22) $ (386) Less reclassification of net realized gains (losses) included in net income 155 38 117 Foreign currency translation adjustments (65) — (65) Other comprehensive income (loss) $ (628) $ (60) $ (568) |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 2022 2021 Numerator: Net income $ 4,442 $ 1,482 $ 2,239 Amounts attributable to noncontrolling interests 1 (6) (82) Net income available to Arch 4,443 1,476 2,157 Preferred dividends (40) (40) (48) Loss on redemption of preferred shares — — (15) Net income available to Arch common shareholders $ 4,403 $ 1,436 $ 2,094 Denominator: Weighted average common shares outstanding 368.7 368.6 391.7 Effect of dilutive common share equivalents: Nonvested restricted shares 2.5 2.1 2.0 Stock options (1) 7.6 6.9 6.6 Weighted average common shares and common share equivalents outstanding – diluted 378.8 377.6 400.3 Earnings per common share: Basic $ 11.94 $ 3.90 $ 5.35 Diluted $ 11.62 $ 3.80 $ 5.23 (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 2023, 2022 and 2021, the number of stock options excluded were 0.5 million, 0.8 million and 2.4 million, respectively. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 2022 2021 Current expense (benefit): United States $ 251 $ 195 $ 284 Non-U.S. 37 6 11 288 201 295 Deferred expense (benefit): United States (20) (96) (123) Non-U.S. (1,141) (25) (44) (1,161) (121) (167) Income tax expense (benefit) $ (873) $ 80 $ 128 |
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, 2023 2022 2021 Income (Loss) Before Income Taxes: Bermuda $ 2,099 $ 986 $ 1,519 United States 1,239 401 643 Other 232 175 206 Total $ 3,570 $ 1,562 $ 2,368 |
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, 2023 2022 2021 Expected income tax expense (benefit) computed on pre-tax income at weighted average income tax rate $ 300 $ 110 $ 158 Addition (reduction) in income tax expense (benefit) resulting from: Investment income (14) (13) (24) State taxes, net of U.S. federal tax benefit 6 11 21 Dividend withholding taxes 9 11 12 Change in valuation allowance 4 (23) (40) Base eroding tax 9 8 — Share based compensation (13) (9) (5) Tax credits (3) (10) — Change in tax rate (1,179) (5) — Other 8 — 6 Income tax expense (benefit) $ (873) $ 80 $ 128 |
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, 2023 2022 Deferred income tax assets: Net operating loss $ 93 $ 77 Discounting of net loss reserves 219 78 Net unearned premium reserve 133 97 Compensation liabilities 64 55 Foreign tax credit carryforward 16 17 Goodwill and intangible assets 1,020 — Bad debt reserves 16 17 Depreciation and amortization 133 141 Lease liability 31 27 Net unrealized decline of investments 89 193 Lloyds year of account deferral — 1 Fair value adjustment to senior notes 41 — Other, net 13 11 Deferred income tax assets before valuation allowance 1,868 714 Valuation allowance (15) (7) Deferred income tax assets net of valuation allowance 1,853 707 Deferred income tax liabilities: Goodwill and intangibles — (39) Lloyds year of account deferral (13) — Contingency reserve (50) (44) Deferred policy acquisition costs (144) (64) Investment related (13) (9) Right-of-use asset (24) (21) Total deferred income tax liabilities (245) (177) Net deferred income tax assets $ 1,608 $ 530 |
Summary of operating loss carryforwards | At December 31, 2023, the Company’s net operating loss carryforwards and tax credits were as follows: Year Ended December 31, 2023 Expiration Operating Loss Carryforwards United Kingdom $ 198 No expiration Ireland 24 No expiration Australia 47 No expiration Hong Kong 32 No expiration Gibraltar 24 No expiration Cyprus 1 No expiration United States (1) 78 2029 - 2038 Tax Credits U.K. foreign tax credits 10 No expiration U.S. foreign tax credits 6 2029 - 2033 |
Summary of tax credit carryforwards | At December 31, 2023, the Company’s net operating loss carryforwards and tax credits were as follows: Year Ended December 31, 2023 Expiration Operating Loss Carryforwards United Kingdom $ 198 No expiration Ireland 24 No expiration Australia 47 No expiration Hong Kong 32 No expiration Gibraltar 24 No expiration Cyprus 1 No expiration United States (1) 78 2029 - 2038 Tax Credits U.K. foreign tax credits 10 No expiration U.S. foreign tax credits 6 2029 - 2033 |
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, 2023 2022 Balance at beginning of year $ 2 $ 2 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 $ 2 |
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 2019-2023 United Kingdom 2021-2023 Ireland 2018-2023 Canada 2019-2023 Switzerland 2019-2023 Denmark 2019-2023 Australia 2019-2023 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Additional information regarding operating leases | Additional information regarding the Company’s operating leases is as follows: December 31, 2023 2022 Operating lease costs $ 33 $ 34 Sublease income (1) $ (2) $ (1) Cash payments included in the measurement of lease liabilities reported in operating cash flows $ 31 $ 26 Right-of-use assets obtained in exchange for new lease liabilities $ 28 $ 43 Right-of-use assets (2) $ 125 $ 123 Operating lease liability (2) $ 156 $ 152 Weighted average discount rate 4.7 % 4.2 % Weighted average remaining lease term 7.2 years 6.6 years (1) The sublease income primarily relates to office property in Raleigh, North Carolina. (2) The right-of-use assets are included in ‘ other assets other liabilities |
Contractual maturities of operating lease liabilities | The following table presents the contractual maturities of the Company's operating lease liabilities at December 31, 2023: Years Ending December 31, 2024 $ 32 2025 27 2026 26 2027 22 2028 19 2029 and thereafter 60 Total undiscounted lease liability $ 186 Less: present value adjustment (30) Operating lease liability $ 156 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 2022 2021 Marsh & McLennan Companies and its subsidiaries 19.0 % 17.3 % 18.3 % Aon Corporation and its subsidiaries 13.9 % 13.8 % 12.2 % |
Debt and Financing Arrangemen_2
Debt and Financing Arrangements - (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of senior notes | The Company’s senior notes payable at December 31, 2023 and 2022 were as follows: Carrying Amount at Interest Principal December 31, (Fixed) Amount 2023 2022 2034 notes (1) 7.350 % $ 300 $ 298 $ 298 2043 notes (2) 5.144 % 500 495 495 2026 notes (3) 4.011 % 500 498 498 2046 notes (4) 5.031 % 450 446 445 2050 notes (5) 3.635 % 1,000 989 989 $ 2,750 $ 2,726 $ 2,725 (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”). |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2021 $ 345 $ 71 $ 529 $ 945 Acquisitions (1) 8 — — 8 Amortization — — (106) (106) Foreign currency movements and other adjustments (11) (2) (30) (43) Net balance at Dec. 31, 2022 342 69 393 804 Acquisitions (1) — — 11 11 Amortization — — (95) (95) Impairment (2) — — (2) Foreign currency movements and other adjustments 5 1 7 13 Net balance at Dec. 31, 2023 $ 345 $ 70 $ 316 $ 731 Gross balance at Dec. 31, 2023 $ 348 $ 70 $ 1,105 $ 1,523 Accumulated amortization — — (766) (766) Foreign currency movements and other adjustments (3) — (23) (26) Net balance at Dec. 31, 2023 $ 345 $ 70 $ 316 $ 731 (1) See note 2, “Acquisitions.” |
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, 2023 Acquired insurance contracts $ 452 $ (441) $ — $ 11 Operating platform 64 (54) — 10 Distribution relationships 594 (277) (23) 294 Goodwill 348 — (3) 345 Insurance licenses 48 — — 48 Syndicate capacity 22 — — 22 Unfavorable service contract (10) 10 — — Other 5 (4) — 1 Total $ 1,523 $ (766) $ (26) $ 731 Dec. 31, 2022 Acquired insurance contracts $ 452 $ (426) $ (1) $ 25 Operating platform 53 (50) — 3 Distribution relationships 602 (208) (31) 363 Goodwill 351 — (9) 342 Insurance licenses 48 — — 48 Syndicate capacity 22 — (1) 21 Unfavorable service contract (10) 10 — — Other 5 (3) — 2 Total $ 1,523 $ (677) $ (42) $ 804 |
Estimated future amortization expense | The estimated remaining amortization expense for the Company’s intangible assets with finite lives is as follows: 2024 $ 77 2025 46 2026 34 2027 31 2028 29 2029 and thereafter 99 Total $ 316 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 2022 2021 Common Shares: Shares issued and outstanding, beginning of year 588.3 583.3 579.0 Shares issued (1) 2.8 3.5 2.7 Restricted shares issued, net of cancellations 0.8 1.5 1.6 Shares issued and outstanding, end of year 591.9 588.3 583.3 Common shares in treasury, end of year (218.5) (217.9) (204.4) Shares issued and outstanding, end of year 373.4 370.4 378.9 |
Schedule of share repurchases | The Company’s repurchases under the share repurchase program were as follows: Year Ended December 31, 2023 2022 2021 Aggregate cost of shares repurchased $ — $ 586 $ 1,234 Shares repurchased — 12.9 31.5 Average price per share repurchased $ — $ 45.44 $ 39.20 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Valuation assumptions | Year Ended December 31, 2023 2022 2021 Dividend yield — % — % — % Expected volatility 25.1 % 24.0 % 24.2 % Risk free interest rate 4.1 % 2.0 % 1.0 % 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 2023 is presented below: Year Ended December 31, 2023 Number of Weighted Average Exercise Price Weighted Average Contractual Term Aggregate Intrinsic Value Outstanding, beginning of year 14,420,901 $ 28.17 Granted 479,760 $ 69.24 Exercised (2,355,729) $ 20.66 Forfeited or expired (8,339) $ 48.38 Outstanding, end of year 12,536,593 $ 31.14 4.10 $ 541 Exercisable, end of year 11,205,102 $ 28.68 3.61 $ 511 |
Weighted average grant date fair value | Year Ended December 31, 2023 2022 2021 Weighted average grant date fair value $ 23.50 $ 13.26 $ 9.22 Aggregate intrinsic value of Options/SARs exercised (in millions) $ 116 $ 113 $ 47 |
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 2023 is presented below: Number of Restricted Common Shares Number of Restricted Unit Awards Unvested Shares: Unvested balance, beginning of year 2,165,554 517,293 Granted 678,657 146,534 Vested (1,281,449) (352,190) Forfeited (38,157) (5,709) Unvested balance, end of year 1,524,605 305,928 Weighted Average Grant Date Fair Value: Unvested balance, beginning of year $ 40.23 $ 37.17 Granted $ 69.47 $ 69.20 Vested $ 38.37 $ 34.16 Forfeited $ 49.65 $ 55.55 Unvested balance, end of year $ 54.57 $ 55.63 |
Performance shares and units, valuation assumptions | Year Ended December 31, 2023 2022 2021 Expected volatility 30.4 % 38.1 % 37.5 % Risk free interest rate 4.6 % 1.7 % 0.3 % |
Unvested performance share and unit activity | Number of Performance Shares Number of Performance Units Unvested Shares: Unvested balance, beginning of year 1,882,916 39,710 Granted 550,394 18,182 Performance adjustment (1) (2) (341,420) (2,024) Vested (207,486) (6,274) Forfeited (3,708) — Unvested balance, end of year 1,880,696 49,594 Weighted Average Grant Date Fair Value: Unvested balance, beginning of year $ 43.75 $ 45.33 Granted $ 74.08 $ 74.31 Performance adjustment (1) (2) $ 44.17 $ 44.17 Vested $ 44.17 $ 44.17 Forfeited $ 59.83 $ — Unvested balance, end of year $ 52.47 $ 56.15 (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, 2023 2022 2021 Pre-Tax Stock options and SARs $ 11 $ 12 $ 12 Restricted share and unit awards 54 50 47 Performance awards 23 22 24 ESPP 4 4 4 Total $ 92 $ 88 $ 87 After-Tax Stock options and SARs $ 10 $ 11 $ 11 Restricted share and unit awards 45 42 39 Performance awards 21 20 22 ESPP 4 4 4 Total $ 80 $ 77 $ 76 |
Unrecognized compensation cost | December 31, 2023 Stock Options and SARs Restricted Common Performance Common Shares and Units Unrecognized compensation cost related to unvested awards $ 7 $ 43 $ 11 Weighted average recognition period (years) 0.67 0.95 0.44 |
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, 2023 2022 2021 Number of restricted shares and restricted unit awards granted 825,191 1,089,393 1,261,773 Weighted average grant date fair value $ 69.42 $ 47.45 $ 36.12 Aggregate fair value of vested restricted share and unit awards (in millions) $ 122 $ 51 $ 41 |
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, 2023 2022 2021 Number of performance awards 568,576 690,772 685,104 Weighted average grant date fair value $ 74.09 $ 49.91 $ 37.38 Aggregate fair value of vested performance share and unit awards (in millions) $ 14 $ 27 $ 24 The aggregate intrinsic value of performance units outstanding at December 31, 2023 was $4 million. |
Statutory Information (Tables)
Statutory Information (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 and 2022: December 31, 2023 2022 Actual capital and surplus (1): Bermuda $ 24,120 $ 19,546 Ireland 1,148 968 United States 6,897 6,195 United Kingdom 1,367 1,018 Canada 83 69 Australia 366 285 Required capital and surplus: Bermuda $ 7,112 $ 6,450 Ireland 942 815 United States 1,895 1,749 United Kingdom 1,192 543 Canada 53 48 Australia 179 176 (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 2023, 2022 and 2021 was as follows: Year Ended December 31, 2023 2022 2021 Statutory net income (loss): Bermuda $ 3,519 $ 1,730 $ 2,371 Ireland 53 (53) 25 United States 592 220 346 United Kingdom 72 57 35 Canada 6 9 7 Australia 68 39 12 |
General (Details)
General (Details) - Greysbridge Holdings Ltd | Jul. 01, 2021 |
Schedule of Equity Method Investments [Line Items] | |
Percentage ownership | 40% |
Kelso And Company | |
Schedule of Equity Method Investments [Line Items] | |
Percentage ownership | 30% |
Warburg Pincus LLC | |
Schedule of Equity Method Investments [Line Items] | |
Percentage ownership | 30% |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Aug. 31, 2021 | Aug. 06, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | |
Business Acquisition [Line Items] | ||||
Goodwill and intangible assets, acquisitions | $ 11 | $ 8 | ||
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 | $ 350.1 |
Significant Accounting Polici_3
Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2023 | |
Significant Accounting Policies [Line Items] | |
Premium revenue recognition period | 12 months |
Investments, time lag for reporting - low end of range | 1 month |
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 Millions | 12 Months Ended | ||||
Dec. 31, 2023 USD ($) segment | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |||
Segment Reporting Information [Line Items] | |||||
Gross premiums written | $ 18,403 | $ 15,327 | $ 12,752 | ||
Premiums ceded | (4,935) | (4,249) | (3,735) | ||
Net premiums written | 13,468 | 11,078 | 9,017 | ||
Change in unearned premiums | (1,028) | (1,399) | (935) | ||
Net premiums earned | 12,440 | 9,679 | 8,082 | ||
Other underwriting income | 31 | 13 | 21 | ||
Losses and loss adjustment expenses | (6,246) | (5,028) | (4,585) | ||
Acquisition expenses, net | (2,312) | (1,740) | (1,303) | ||
Other operating expenses | (1,301) | (1,128) | (999) | ||
Underwriting income (loss) | 2,612 | 1,796 | 1,216 | ||
Net investment income | 1,023 | 496 | 389 | ||
Net realized gains (losses) | (165) | (663) | 380 | ||
Equity in net income (loss) of investment funds accounted for using the equity method | 278 | 115 | 366 | ||
Other income (loss) | 27 | (27) | 10 | ||
Corporate expenses | (96) | (95) | (76) | ||
Transaction costs and other | (6) | 0 | (2) | ||
Amortization of intangible assets | (95) | (106) | (82) | ||
Interest expense | (133) | (131) | (139) | ||
Net foreign exchange gains (losses) | (60) | 102 | 41 | ||
Income before income taxes and income (loss) from operating affiliates | 3,385 | 1,487 | 2,103 | ||
Income tax (expense) benefit | 873 | (80) | (128) | ||
Income (loss) from operating affiliates | 184 | 75 | 264 | ||
Net income (loss) | 4,442 | 1,482 | 2,239 | ||
Amounts attributable to redeemable noncontrolling interests | 1 | (6) | (4) | ||
Amounts attributable to nonredeemable noncontrolling interests | 0 | 0 | (78) | ||
Net income available to Arch | 4,443 | 1,476 | 2,157 | ||
Preferred share dividends | (40) | (40) | (48) | ||
Loss on redemption of preferred shares | 0 | 0 | (15) | ||
Net income (loss) available to Arch common shareholders | $ 4,403 | $ 1,436 | $ 2,094 | ||
Underwriting Ratios | |||||
Loss ratio | 50.20% | 51.90% | 56.70% | ||
Acquisition expense ratio | 18.60% | 18% | 16.10% | ||
Other operating expense ratio | 10.50% | 11.70% | 12.40% | ||
Combined ratio | 79.30% | 81.60% | 85.20% | ||
Goodwill and intangible assets | $ 731 | $ 804 | $ 945 | ||
Total investable assets | 34,589 | 28,065 | 27,442 | ||
Total assets | 58,906 | 47,990 | 45,101 | ||
Total liabilities | $ 40,551 | 35,069 | 31,546 | ||
Operating segments | Underwriting Segments | |||||
Segment Reporting Information [Line Items] | |||||
Number of segments | segment | 3 | ||||
Gross premiums written | [1] | $ 18,403 | 15,327 | 12,463 | |
Premiums ceded | [1] | (4,935) | (4,249) | (3,799) | |
Net premiums written | 13,468 | 11,078 | 8,664 | ||
Change in unearned premiums | (1,028) | (1,399) | (915) | ||
Net premiums earned | 12,440 | 9,679 | 7,749 | ||
Other underwriting income | 31 | 13 | 21 | ||
Losses and loss adjustment expenses | (6,246) | (5,028) | (4,327) | ||
Acquisition expenses, net | (2,312) | (1,740) | (1,240) | ||
Other operating expenses | (1,301) | (1,128) | (966) | ||
Underwriting income (loss) | 2,612 | 1,796 | 1,237 | ||
Net investment income | 1,023 | 496 | 347 | ||
Net realized gains (losses) | (165) | (663) | 299 | ||
Equity in net income (loss) of investment funds accounted for using the equity method | 278 | 115 | 366 | ||
Other income (loss) | 27 | (27) | 10 | ||
Corporate expenses | (96) | (95) | (76) | ||
Transaction costs and other | (6) | 0 | (1) | ||
Amortization of intangible assets | (95) | (106) | (81) | ||
Interest expense | (133) | (131) | (131) | ||
Net foreign exchange gains (losses) | (60) | 102 | 42 | ||
Income before income taxes and income (loss) from operating affiliates | 3,385 | 1,487 | 2,012 | ||
Income tax (expense) benefit | 873 | (80) | (128) | ||
Income (loss) from operating affiliates | 184 | 75 | 264 | ||
Net income (loss) | 4,442 | 1,482 | 2,148 | ||
Amounts attributable to redeemable noncontrolling interests | 1 | (6) | (2) | ||
Amounts attributable to nonredeemable noncontrolling interests | 0 | ||||
Net income available to Arch | 4,443 | 1,476 | 2,148 | ||
Preferred share dividends | (40) | (40) | (48) | ||
Loss on redemption of preferred shares | (15) | ||||
Net income (loss) available to Arch common shareholders | $ 4,403 | $ 1,436 | $ 2,085 | ||
Underwriting Ratios | |||||
Loss ratio | 50.20% | 51.90% | 55.80% | ||
Acquisition expense ratio | 18.60% | 18% | 16% | ||
Other operating expense ratio | 10.50% | 11.70% | 12.50% | ||
Combined ratio | 79.30% | 81.60% | 84.30% | ||
Goodwill and intangible assets | $ 731 | $ 804 | $ 945 | ||
Total investable assets | 34,589 | 28,065 | 27,442 | ||
Total assets | 58,906 | 47,990 | 45,101 | ||
Total liabilities | 40,551 | 35,069 | 31,546 | ||
Operating segments | Insurance | |||||
Segment Reporting Information [Line Items] | |||||
Gross premiums written | [1] | 7,911 | 6,931 | 5,868 | |
Premiums ceded | [1],[2] | (2,049) | (1,910) | (1,719) | |
Net premiums written | 5,862 | 5,021 | 4,149 | ||
Change in unearned premiums | (416) | (461) | (524) | ||
Net premiums earned | 5,446 | 4,560 | 3,625 | ||
Other underwriting income | 0 | 0 | 0 | ||
Losses and loss adjustment expenses | (3,122) | (2,784) | (2,345) | ||
Acquisition expenses, net | (1,055) | (887) | (606) | ||
Other operating expenses | (819) | (665) | (559) | ||
Underwriting income (loss) | $ 450 | $ 224 | $ 115 | ||
Underwriting Ratios | |||||
Loss ratio | 57.30% | 61% | 64.60% | ||
Acquisition expense ratio | 19.40% | 19.40% | 16.70% | ||
Other operating expense ratio | 15% | 14.60% | 15.40% | ||
Combined ratio | 91.70% | 95% | 96.70% | ||
Goodwill and intangible assets | $ 224 | $ 229 | $ 256 | ||
Operating segments | Reinsurance | |||||
Segment Reporting Information [Line Items] | |||||
Gross premiums written | [1] | 9,113 | 6,948 | 5,094 | |
Premiums ceded | [1],[2] | (2,559) | (2,024) | (1,840) | |
Net premiums written | 6,554 | 4,924 | 3,254 | ||
Change in unearned premiums | (718) | (965) | (413) | ||
Net premiums earned | 5,836 | 3,959 | 2,841 | ||
Other underwriting income | 17 | 5 | 3 | ||
Losses and loss adjustment expenses | (3,227) | (2,568) | (1,925) | ||
Acquisition expenses, net | (1,240) | (813) | (537) | ||
Other operating expenses | (288) | (268) | (214) | ||
Underwriting income (loss) | $ 1,098 | $ 315 | $ 168 | ||
Underwriting Ratios | |||||
Loss ratio | 55.30% | 64.90% | 67.80% | ||
Acquisition expense ratio | 21.20% | 20.50% | 18.90% | ||
Other operating expense ratio | 4.90% | 6.80% | 7.50% | ||
Combined ratio | 81.40% | 92.20% | 94.20% | ||
Goodwill and intangible assets | $ 130 | $ 145 | $ 184 | ||
Operating segments | Mortgage | |||||
Segment Reporting Information [Line Items] | |||||
Gross premiums written | [1] | 1,387 | 1,455 | 1,508 | |
Premiums ceded | [1],[2] | (335) | (322) | (247) | |
Net premiums written | 1,052 | 1,133 | 1,261 | ||
Change in unearned premiums | 106 | 27 | 22 | ||
Net premiums earned | 1,158 | 1,160 | 1,283 | ||
Other underwriting income | 14 | 8 | 18 | ||
Losses and loss adjustment expenses | 103 | 324 | (57) | ||
Acquisition expenses, net | (17) | (40) | (97) | ||
Other operating expenses | (194) | (195) | (193) | ||
Underwriting income (loss) | $ 1,064 | $ 1,257 | $ 954 | ||
Underwriting Ratios | |||||
Loss ratio | (8.90%) | (28.00%) | 4.40% | ||
Acquisition expense ratio | 1.40% | 3.50% | 7.60% | ||
Other operating expense ratio | 16.80% | 16.80% | 15.10% | ||
Combined ratio | 9.30% | (7.70%) | 27.10% | ||
Goodwill and intangible assets | $ 377 | $ 430 | $ 505 | ||
Operating segments | Other | |||||
Segment Reporting Information [Line Items] | |||||
Number of segments | segment | 2 | ||||
Gross premiums written | [1] | $ 0 | 0 | 458 | |
Premiums ceded | [1] | 0 | 0 | (105) | [2] |
Net premiums written | 0 | 0 | 353 | ||
Change in unearned premiums | 0 | 0 | (20) | ||
Net premiums earned | 0 | 0 | 333 | ||
Other underwriting income | 0 | 0 | 0 | ||
Losses and loss adjustment expenses | 0 | 0 | (258) | ||
Acquisition expenses, net | 0 | 0 | (63) | ||
Other operating expenses | 0 | 0 | (33) | ||
Underwriting income (loss) | 0 | 0 | (21) | ||
Net investment income | 0 | 0 | 42 | ||
Net realized gains (losses) | 0 | 0 | 81 | ||
Equity in net income (loss) of investment funds accounted for using the equity method | 0 | 0 | 0 | ||
Other income (loss) | 0 | 0 | 0 | ||
Corporate expenses | 0 | 0 | 0 | ||
Transaction costs and other | 0 | 0 | (1) | ||
Amortization of intangible assets | 0 | 0 | (1) | ||
Interest expense | 0 | 0 | (8) | ||
Net foreign exchange gains (losses) | 0 | 0 | (1) | ||
Income before income taxes and income (loss) from operating affiliates | 0 | 0 | 91 | ||
Income tax (expense) benefit | 0 | 0 | 0 | ||
Income (loss) from operating affiliates | 0 | 0 | 0 | ||
Net income (loss) | 0 | 0 | 91 | ||
Amounts attributable to redeemable noncontrolling interests | 0 | 0 | (2) | ||
Amounts attributable to nonredeemable noncontrolling interests | (78) | ||||
Net income available to Arch | 0 | 0 | 9 | ||
Preferred share dividends | 0 | 0 | 0 | ||
Loss on redemption of preferred shares | 0 | ||||
Net income (loss) available to Arch common shareholders | $ 0 | $ 0 | $ 9 | ||
Underwriting Ratios | |||||
Loss ratio | 0% | 0% | 78% | ||
Acquisition expense ratio | 0% | 0% | 18.90% | ||
Other operating expense ratio | 0% | 0% | 9.90% | ||
Combined ratio | 0% | 0% | 106.80% | ||
Goodwill and intangible assets | $ 0 | $ 0 | $ 0 | ||
Total investable assets | 0 | 0 | 0 | ||
Total assets | 0 | 0 | 0 | ||
Total liabilities | $ 0 | $ 0 | $ 0 | ||
[1]Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations.[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 Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | $ 12,440 | $ 9,679 | $ 8,082 | |
Net premiums written | 13,468 | 11,078 | 9,017 | |
Operating segments | Insurance | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 5,446 | 4,560 | 3,625 | |
Net premiums written | 5,862 | 5,021 | 4,149 | |
Operating segments | Insurance | United States | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 3,780 | 3,342 | 2,812 |
Operating segments | Insurance | Europe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 1,774 | 1,405 | 1,126 |
Operating segments | Insurance | Other geographic location | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 308 | 274 | 211 |
Operating segments | Insurance | Professional lines | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 1,419 | 1,314 | 943 |
Operating segments | Insurance | Property, energy, marine and aviation | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 1,064 | 772 | 668 |
Operating segments | Insurance | Programs | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 658 | 590 | 507 |
Operating segments | Insurance | Construction and national accounts | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 561 | 432 | 417 |
Operating segments | Insurance | Travel, accident and health | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 557 | 492 | 256 |
Operating segments | Insurance | Excess and surplus casualty | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 486 | 393 | 318 |
Operating segments | Insurance | Warranty and lenders solutions | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 185 | 128 | 153 |
Operating segments | Insurance | Other | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 516 | 439 | 363 |
Operating segments | Reinsurance | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 5,836 | 3,959 | 2,841 | |
Net premiums written | 6,554 | 4,924 | 3,254 | |
Operating segments | Reinsurance | United States | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 1,756 | 1,247 | 829 |
Operating segments | Reinsurance | Bermuda | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 3,288 | 2,561 | 1,555 |
Operating segments | Reinsurance | Europe and other | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 1,510 | 1,116 | 870 |
Operating segments | Reinsurance | Other specialty | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 2,097 | 1,378 | 819 |
Operating segments | Reinsurance | Property excluding property catastrophe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 1,645 | 1,090 | 838 |
Operating segments | Reinsurance | Casualty | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 1,005 | 855 | 667 |
Operating segments | Reinsurance | Property catastrophe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 742 | 367 | 280 |
Operating segments | Reinsurance | Marine and aviation | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 229 | 159 | 153 |
Operating segments | Reinsurance | Other | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 118 | 110 | 84 |
Operating segments | Mortgage | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 1,158 | 1,160 | 1,283 | |
Net premiums written | 1,052 | 1,133 | 1,261 | |
Operating segments | Mortgage | United States | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | 743 | 781 | 913 | |
Operating segments | Mortgage | Other geographic location | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | 309 | 352 | 348 | |
Operating segments | Mortgage | US Primary Mortgage Insurance | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 759 | 804 | 953 | |
Operating segments | Mortgage | US Credit Risk Transfer And Other | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 220 | 196 | 181 | |
Operating segments | Mortgage | International Mortgage Insurance And Reinsurance | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 179 | 160 | 149 | |
Operating segments | Other | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | 0 | 0 | 333 | |
Net premiums written | 0 | 0 | 353 | |
Operating segments | Other | United States | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 0 | 0 | 63 |
Operating segments | Other | Europe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 0 | 0 | 91 |
Operating segments | Other | Bermuda | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums written | [1] | 0 | 0 | 199 |
Operating segments | Other | Other specialty | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 0 | 0 | 118 |
Operating segments | Other | Property excluding property catastrophe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 0 | 0 | 7 |
Operating segments | Other | Casualty | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 0 | 0 | 138 |
Operating segments | Other | Property catastrophe | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 0 | 0 | 15 |
Operating segments | Other | Marine and aviation | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | 0 | 0 | 0 |
Operating segments | Other | Other | ||||
Segment Reporting Information [Line Items] | ||||
Net premiums earned | [1] | $ 0 | $ 0 | $ 55 |
[1]Segment results include intersegment transactions. |
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 Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract] | ||||
Reserve for losses and loss adjustment expenses at beginning of year | $ 20,032 | $ 17,757 | $ 16,514 | |
Unpaid losses and loss adjustment expenses recoverable | 6,280 | 5,599 | 4,315 | |
Net reserve for losses and loss adjustment expenses at beginning of year | 13,752 | 12,158 | 12,199 | |
Net incurred losses and loss adjustment expenses relating to losses occurring in: | ||||
Current year | 6,784 | 5,797 | 4,940 | |
Prior years | (538) | (769) | (355) | |
Total net incurred losses and loss adjustment expenses | 6,246 | 5,028 | 4,585 | |
Net losses and loss adjustment expense reserves of acquired business | [1] | 0 | 0 | 104 |
Retroactive reinsurance transaction | [2] | 0 | 0 | (444) |
Impact of deconsolidation of Somers | 0 | 0 | (1,461) | |
Foreign exchange (gains) losses and other | 157 | (293) | 2 | |
Net paid losses and loss adjustment expenses relating to losses occurring in: | ||||
Current year | (1,081) | (888) | (734) | |
Prior years | (3,012) | (2,253) | (2,093) | |
Total net paid losses and loss adjustment expenses | (4,093) | (3,141) | (2,827) | |
Net reserve for losses and loss adjustment expenses at end of year | 16,062 | 13,752 | 12,158 | |
Unpaid losses and loss adjustment expenses recoverable | 6,690 | 6,280 | 5,599 | |
Reserve for losses and loss adjustment expenses at end of year | $ 22,752 | $ 20,032 | $ 17,757 | |
[1]Represents activity related to the Company’s acquisitions in the 2021 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 Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 538 | $ 769 | $ 355 |
Operating segments | Insurance | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 42 | $ 25 | $ 16 |
Prior year reserve development (points) | 0.80% | 0.60% | 0.40% |
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) | $ 55 | $ 82 | |
Operating segments | Insurance | Short-tailed lines | Property Excluding Marine | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 32 | 39 | |
Operating segments | Insurance | Short-tailed lines | Travel and Accident | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 15 | 15 | 16 |
Operating segments | Insurance | Short-tailed lines | Warranty and lenders solutions | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 22 | 37 | 27 |
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) | (65) | (94) | |
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) | (50) | (25) | (31) |
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) | (21) | (6) | (58) |
Operating segments | Insurance | Medium-tailed lines | Marine | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 12 | 13 | |
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 | ||
Operating segments | Insurance | Long-tailed lines | Casualty | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | (19) | ||
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) | 22 | ||
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) | (6) | (7) | |
Operating segments | Insurance | Long-tailed lines | Executive assurance | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 28 | ||
Operating segments | Insurance | Long-tailed lines | Alternative Markets | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 17 | ||
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) | (30) | ||
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) | 107 | 110 | |
Operating segments | Reinsurance | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 152 | $ 190 | $ 179 |
Prior year reserve development (points) | 2.60% | 4.80% | 6.30% |
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) | $ 176 | ||
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) | $ 51 | $ 24 | (36) |
Operating segments | Reinsurance | Short-tailed lines | Property excluding property catastrophe | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 93 | 109 | 89 |
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) | 35 | 35 | 123 |
Operating segments | Reinsurance | Short-tailed lines | Other business | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 13 | ||
Operating segments | Reinsurance | Medium-tailed lines | Marine and aviation | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | 9 | 28 | |
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) | (50) | (5) | (5) |
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) | (46) | (5) | |
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) | 202 | 196 | 184 |
Operating segments | Mortgage | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ 344 | $ 554 | $ 170 |
Prior year reserve development (points) | 29.70% | 47.80% | 13.20% |
Operating segments | Other | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Prior year development favorable (unfavorable) | $ (8) |
Short Duration Contracts - Clai
Short Duration Contracts - Claims development - Insurance (Details) $ in Millions | Dec. 31, 2023 USD ($) claims | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2019 USD ($) | Dec. 31, 2018 USD ($) | Dec. 31, 2017 USD ($) | Dec. 31, 2016 USD ($) | Dec. 31, 2015 USD ($) | Dec. 31, 2014 USD ($) |
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | $ 15,700 | |||||||||
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 | 2,688 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 1,878 | |||||||||
All outstanding liabilities before 2014, net of reinsurance | 14 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 824 | |||||||||
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 | 133 | $ 134 | $ 135 | $ 135 | $ 134 | $ 132 | $ 136 | $ 147 | $ 146 | $ 148 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 125 | 123 | 122 | 115 | 98 | 88 | 84 | 78 | 54 | 26 |
Total of IBNR liabilities plus expected development on reported claims | $ 2 | |||||||||
Cumulative number of reported claims | claims | 3,871 | |||||||||
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 | $ 89 | 91 | 92 | 92 | 98 | 102 | 104 | 110 | 112 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 86 | 88 | 87 | 86 | 88 | 86 | 76 | 65 | 24 | |
Total of IBNR liabilities plus expected development on reported claims | $ 2 | |||||||||
Cumulative number of reported claims | claims | 4,530 | |||||||||
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 | $ 88 | 88 | 92 | 96 | 100 | 105 | 101 | 104 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 87 | 87 | 91 | 95 | 97 | 98 | 83 | 25 | ||
Total of IBNR liabilities plus expected development on reported claims | $ 0 | |||||||||
Cumulative number of reported claims | claims | 6,171 | |||||||||
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 | $ 225 | 225 | 231 | 230 | 236 | 246 | 281 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 220 | 218 | 216 | 212 | 196 | 140 | 30 | |||
Total of IBNR liabilities plus expected development on reported claims | $ 1 | |||||||||
Cumulative number of reported claims | claims | 6,475 | |||||||||
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 | $ 172 | 170 | 170 | 174 | 186 | 181 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 154 | 150 | 143 | 135 | 102 | 30 | ||||
Total of IBNR liabilities plus expected development on reported claims | $ 5 | |||||||||
Cumulative number of reported claims | claims | 5,077 | |||||||||
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 | $ 159 | 161 | 165 | 179 | 179 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 148 | 139 | 134 | 105 | 26 | |||||
Total of IBNR liabilities plus expected development on reported claims | $ (1) | |||||||||
Cumulative number of reported claims | claims | 7,018 | |||||||||
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 | $ 333 | 336 | 329 | 359 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 293 | 251 | 194 | 56 | ||||||
Total of IBNR liabilities plus expected development on reported claims | $ 9 | |||||||||
Cumulative number of reported claims | claims | 8,212 | |||||||||
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 | $ 423 | 429 | 427 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 343 | 268 | 90 | |||||||
Total of IBNR liabilities plus expected development on reported claims | $ 41 | |||||||||
Cumulative number of reported claims | claims | 8,807 | |||||||||
Insurance | Property, energy, marine and aviation | 2022 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 495 | 522 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 276 | 100 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 74 | |||||||||
Cumulative number of reported claims | claims | 13,274 | |||||||||
Insurance | Property, energy, marine and aviation | 2023 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 571 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 146 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 275 | |||||||||
Cumulative number of reported claims | claims | 13,682 | |||||||||
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 | $ 5,304 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 1,990 | |||||||||
All outstanding liabilities before 2014, net of reinsurance | 287 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 3,601 | |||||||||
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 | 344 | 345 | 343 | 343 | 344 | 339 | 343 | 339 | 336 | 330 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 257 | 237 | 224 | 211 | 191 | 162 | 113 | 71 | 40 | 9 |
Total of IBNR liabilities plus expected development on reported claims | $ 49 | |||||||||
Cumulative number of reported claims | claims | 75,679 | |||||||||
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 | $ 377 | 379 | 386 | 382 | 391 | 392 | 399 | 392 | 359 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 268 | 249 | 227 | 212 | 182 | 139 | 88 | 45 | 11 | |
Total of IBNR liabilities plus expected development on reported claims | $ 66 | |||||||||
Cumulative number of reported claims | claims | 78,689 | |||||||||
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 | $ 352 | 363 | 368 | 375 | 399 | 406 | 394 | 390 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 231 | 215 | 195 | 165 | 137 | 88 | 42 | 12 | ||
Total of IBNR liabilities plus expected development on reported claims | $ 77 | |||||||||
Cumulative number of reported claims | claims | 78,883 | |||||||||
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 | $ 405 | 406 | 407 | 412 | 422 | 418 | 417 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 247 | 221 | 165 | 135 | 100 | 52 | 13 | |||
Total of IBNR liabilities plus expected development on reported claims | $ 100 | |||||||||
Cumulative number of reported claims | claims | 84,687 | |||||||||
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 | $ 462 | 459 | 451 | 451 | 453 | 430 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 247 | 200 | 154 | 115 | 64 | 17 | ||||
Total of IBNR liabilities plus expected development on reported claims | $ 127 | |||||||||
Cumulative number of reported claims | claims | 78,320 | |||||||||
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 | $ 470 | 471 | 481 | 487 | 456 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 214 | 173 | 122 | 73 | 18 | |||||
Total of IBNR liabilities plus expected development on reported claims | $ 154 | |||||||||
Cumulative number of reported claims | claims | 86,139 | |||||||||
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 | $ 632 | 640 | 616 | 607 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 235 | 155 | 77 | 24 | ||||||
Total of IBNR liabilities plus expected development on reported claims | $ 226 | |||||||||
Cumulative number of reported claims | claims | 92,279 | |||||||||
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 | $ 659 | 663 | 622 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 174 | 91 | 26 | |||||||
Total of IBNR liabilities plus expected development on reported claims | $ 290 | |||||||||
Cumulative number of reported claims | claims | 92,672 | |||||||||
Insurance | Third party occurrence business | 2022 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 726 | 688 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 85 | 24 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 513 | |||||||||
Cumulative number of reported claims | claims | 92,564 | |||||||||
Insurance | Third party occurrence business | 2023 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 877 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 32 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 750 | |||||||||
Cumulative number of reported claims | claims | 72,833 | |||||||||
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 | $ 4,334 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 2,059 | |||||||||
All outstanding liabilities before 2014, net of reinsurance | 77 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 2,352 | |||||||||
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 | 287 | 296 | 288 | 291 | 297 | 281 | 279 | 299 | 279 | 264 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 266 | 260 | 249 | 243 | 229 | 207 | 173 | 129 | 63 | 14 |
Total of IBNR liabilities plus expected development on reported claims | $ 14 | |||||||||
Cumulative number of reported claims | claims | 14,494 | |||||||||
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 | $ 274 | 267 | 268 | 252 | 255 | 260 | 276 | 277 | 259 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 242 | 221 | 217 | 193 | 174 | 126 | 100 | 52 | 9 | |
Total of IBNR liabilities plus expected development on reported claims | $ 13 | |||||||||
Cumulative number of reported claims | claims | 13,932 | |||||||||
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 | 330 | 327 | 322 | 314 | 308 | 291 | 275 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 296 | 257 | 242 | 205 | 158 | 127 | 68 | 11 | ||
Total of IBNR liabilities plus expected development on reported claims | $ 18 | |||||||||
Cumulative number of reported claims | claims | 14,912 | |||||||||
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 | $ 338 | 317 | 323 | 308 | 312 | 286 | 270 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 258 | 233 | 196 | 143 | 113 | 68 | 9 | |||
Total of IBNR liabilities plus expected development on reported claims | $ 48 | |||||||||
Cumulative number of reported claims | claims | 15,473 | |||||||||
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 | $ 367 | 347 | 336 | 320 | 314 | 273 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 258 | 208 | 158 | 118 | 68 | 12 | ||||
Total of IBNR liabilities plus expected development on reported claims | $ 44 | |||||||||
Cumulative number of reported claims | claims | 17,098 | |||||||||
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 | $ 330 | 322 | 317 | 317 | 289 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 197 | 155 | 122 | 65 | 12 | |||||
Total of IBNR liabilities plus expected development on reported claims | $ 66 | |||||||||
Cumulative number of reported claims | claims | 15,879 | |||||||||
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 | $ 446 | 423 | 413 | 383 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 215 | 152 | 87 | 17 | ||||||
Total of IBNR liabilities plus expected development on reported claims | $ 118 | |||||||||
Cumulative number of reported claims | claims | 15,239 | |||||||||
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 | $ 499 | 518 | 515 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 163 | 90 | 23 | |||||||
Total of IBNR liabilities plus expected development on reported claims | $ 254 | |||||||||
Cumulative number of reported claims | claims | 16,323 | |||||||||
Insurance | Third party claims-made business | 2022 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 655 | 669 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 100 | 25 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 448 | |||||||||
Cumulative number of reported claims | claims | 18,563 | |||||||||
Insurance | Third party claims-made business | 2023 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 811 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 64 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 641 | |||||||||
Cumulative number of reported claims | claims | 20,494 | |||||||||
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 | $ 5,389 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 4,065 | |||||||||
All outstanding liabilities before 2014, net of reinsurance | 24 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 1,348 | |||||||||
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 | 311 | 309 | 310 | 313 | 317 | 318 | 318 | 326 | 302 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 297 | 296 | 295 | 293 | 292 | 281 | 267 | 234 | 197 | $ 108 |
Total of IBNR liabilities plus expected development on reported claims | $ 4 | |||||||||
Cumulative number of reported claims | claims | 148,702 | |||||||||
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 | $ 345 | 345 | 347 | 349 | 357 | 365 | 357 | 358 | 335 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 333 | 331 | 330 | 327 | 321 | 306 | 278 | 236 | $ 138 | |
Total of IBNR liabilities plus expected development on reported claims | $ 5 | |||||||||
Cumulative number of reported claims | claims | 180,468 | |||||||||
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 | $ 406 | 409 | 408 | 410 | 416 | 428 | 431 | 409 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 392 | 390 | 385 | 379 | 363 | 342 | 305 | $ 176 | ||
Total of IBNR liabilities plus expected development on reported claims | $ 7 | |||||||||
Cumulative number of reported claims | claims | 192,955 | |||||||||
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 | $ 516 | 513 | 504 | 501 | 491 | 501 | 482 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 480 | 472 | 446 | 423 | 381 | 342 | $ 181 | |||
Total of IBNR liabilities plus expected development on reported claims | $ 9 | |||||||||
Cumulative number of reported claims | claims | 235,539 | |||||||||
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 | $ 565 | 565 | 565 | 563 | 565 | 512 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 527 | 509 | 480 | 443 | 389 | $ 212 | ||||
Total of IBNR liabilities plus expected development on reported claims | $ 14 | |||||||||
Cumulative number of reported claims | claims | 260,995 | |||||||||
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 | $ 657 | 651 | 640 | 612 | 567 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 577 | 549 | 487 | 386 | $ 212 | |||||
Total of IBNR liabilities plus expected development on reported claims | $ 21 | |||||||||
Cumulative number of reported claims | claims | 252,766 | |||||||||
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 | $ 517 | 515 | 569 | 618 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 406 | 359 | 309 | $ 172 | ||||||
Total of IBNR liabilities plus expected development on reported claims | $ 44 | |||||||||
Cumulative number of reported claims | claims | 166,357 | |||||||||
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 | $ 614 | 619 | 635 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 428 | 335 | $ 157 | |||||||
Total of IBNR liabilities plus expected development on reported claims | $ 76 | |||||||||
Cumulative number of reported claims | claims | 114,447 | |||||||||
Insurance | Multi-line and other specialty | 2022 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 642 | 678 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 371 | $ 177 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 157 | |||||||||
Cumulative number of reported claims | claims | 143,264 | |||||||||
Insurance | Multi-line and other specialty | 2023 | ||||||||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 817 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 254 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 450 | |||||||||
Cumulative number of reported claims | claims | 118,241 |
Short Duration Contracts - Cl_2
Short Duration Contracts - Claims development - Reinsurance (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Claims Development [Line Items] | ||||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | $ 15,700 | |||||||||
Reinsurance | Casualty | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 3,801 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 1,405 | |||||||||
All outstanding liabilities before 2014, net of reinsurance | 310 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 2,706 | |||||||||
Reinsurance | Casualty | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 241 | $ 234 | $ 234 | $ 237 | $ 237 | $ 227 | $ 230 | $ 217 | $ 220 | $ 215 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 160 | 153 | 145 | 134 | 114 | 91 | 63 | 41 | 16 | 4 |
Total of IBNR liabilities plus expected development on reported claims | 33 | |||||||||
Reinsurance | Casualty | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 260 | 251 | 249 | 246 | 239 | 235 | 228 | 219 | 220 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 170 | 152 | 137 | 120 | 96 | 71 | 47 | 20 | 4 | |
Total of IBNR liabilities plus expected development on reported claims | 44 | |||||||||
Reinsurance | Casualty | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 281 | 272 | 268 | 269 | 262 | 247 | 224 | 212 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 172 | 157 | 132 | 113 | 87 | 52 | 26 | 6 | ||
Total of IBNR liabilities plus expected development on reported claims | 45 | |||||||||
Reinsurance | Casualty | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 330 | 316 | 309 | 297 | 270 | 254 | 267 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 189 | 164 | 137 | 113 | 64 | 30 | 6 | |||
Total of IBNR liabilities plus expected development on reported claims | 53 | |||||||||
Reinsurance | Casualty | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 308 | 298 | 286 | 281 | 289 | 276 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 182 | 155 | 129 | 106 | 31 | 8 | ||||
Total of IBNR liabilities plus expected development on reported claims | 50 | |||||||||
Reinsurance | Casualty | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 400 | 379 | 367 | 341 | 330 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 219 | 130 | 97 | 58 | 16 | |||||
Total of IBNR liabilities plus expected development on reported claims | 84 | |||||||||
Reinsurance | Casualty | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 372 | 354 | 371 | 382 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 132 | 90 | 50 | 18 | ||||||
Total of IBNR liabilities plus expected development on reported claims | 163 | |||||||||
Reinsurance | Casualty | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 425 | 434 | 439 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 102 | 53 | 15 | |||||||
Total of IBNR liabilities plus expected development on reported claims | 205 | |||||||||
Reinsurance | Casualty | 2022 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 527 | 547 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 61 | 18 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | 390 | |||||||||
Reinsurance | Casualty | 2023 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 657 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 18 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | 568 | |||||||||
Reinsurance | Property catastrophe | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 1,229 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 668 | |||||||||
All outstanding liabilities before 2014, net of reinsurance | 2 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 563 | |||||||||
Reinsurance | Property catastrophe | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 19 | 19 | 19 | 19 | 20 | 20 | 22 | 25 | 30 | 44 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 19 | 19 | 19 | 19 | 19 | 18 | 19 | 18 | 20 | 14 |
Total of IBNR liabilities plus expected development on reported claims | 0 | |||||||||
Reinsurance | Property catastrophe | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 3 | 3 | 3 | 3 | 4 | 6 | 12 | 18 | 33 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 2 | 2 | 2 | 2 | 2 | 2 | 2 | (2) | (3) | |
Total of IBNR liabilities plus expected development on reported claims | 0 | |||||||||
Reinsurance | Property catastrophe | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 5 | 5 | 6 | 7 | 9 | 13 | 17 | 24 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 3 | 3 | 3 | 2 | 3 | 2 | 2 | (7) | ||
Total of IBNR liabilities plus expected development on reported claims | 1 | |||||||||
Reinsurance | Property catastrophe | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 22 | 21 | 24 | 36 | 50 | 54 | 86 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 17 | 16 | 14 | 27 | 37 | 32 | 31 | |||
Total of IBNR liabilities plus expected development on reported claims | (1) | |||||||||
Reinsurance | Property catastrophe | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 5 | 8 | 17 | 30 | 49 | 71 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | (9) | (11) | (13) | 16 | 5 | 27 | ||||
Total of IBNR liabilities plus expected development on reported claims | 3 | |||||||||
Reinsurance | Property catastrophe | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | (7) | 1 | 9 | 10 | 20 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | (13) | (14) | 11 | 7 | 4 | |||||
Total of IBNR liabilities plus expected development on reported claims | 2 | |||||||||
Reinsurance | Property catastrophe | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 326 | 337 | 333 | 269 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 249 | 207 | 158 | 56 | ||||||
Total of IBNR liabilities plus expected development on reported claims | 17 | |||||||||
Reinsurance | Property catastrophe | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 294 | 308 | 314 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 222 | 171 | 65 | |||||||
Total of IBNR liabilities plus expected development on reported claims | 13 | |||||||||
Reinsurance | Property catastrophe | 2022 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 295 | 303 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 169 | 70 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | 41 | |||||||||
Reinsurance | Property catastrophe | 2023 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 267 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 9 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | 76 | |||||||||
Reinsurance | Property excluding property catastrophe | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 3,285 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 2,029 | |||||||||
All outstanding liabilities before 2014, net of reinsurance | 5 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 1,261 | |||||||||
Reinsurance | Property excluding property catastrophe | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 79 | 79 | 80 | 82 | 84 | 88 | 90 | 98 | 117 | 142 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 78 | 78 | 78 | 78 | 78 | 78 | 76 | 71 | 62 | 23 |
Total of IBNR liabilities plus expected development on reported claims | 0 | |||||||||
Reinsurance | Property excluding property catastrophe | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 167 | 167 | 173 | 176 | 187 | 188 | 184 | 188 | 214 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 160 | 159 | 159 | 159 | 165 | 160 | 149 | 119 | 75 | |
Total of IBNR liabilities plus expected development on reported claims | 4 | |||||||||
Reinsurance | Property excluding property catastrophe | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 130 | 130 | 136 | 139 | 135 | 137 | 145 | 175 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 115 | 115 | 114 | 111 | 104 | 98 | 94 | 33 | ||
Total of IBNR liabilities plus expected development on reported claims | 6 | |||||||||
Reinsurance | Property excluding property catastrophe | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 202 | 206 | 214 | 230 | 237 | 250 | 268 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 186 | 182 | 179 | 164 | 156 | 125 | 28 | |||
Total of IBNR liabilities plus expected development on reported claims | 7 | |||||||||
Reinsurance | Property excluding property catastrophe | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 203 | 202 | 212 | 235 | 239 | 224 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 177 | 175 | 167 | 152 | 108 | 30 | ||||
Total of IBNR liabilities plus expected development on reported claims | 7 | |||||||||
Reinsurance | Property excluding property catastrophe | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 190 | 190 | 195 | 206 | 216 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 169 | 162 | 150 | 124 | 43 | |||||
Total of IBNR liabilities plus expected development on reported claims | 3 | |||||||||
Reinsurance | Property excluding property catastrophe | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 320 | 320 | 340 | 368 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 267 | 243 | 207 | 101 | ||||||
Total of IBNR liabilities plus expected development on reported claims | 15 | |||||||||
Reinsurance | Property excluding property catastrophe | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 491 | 497 | 545 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 364 | 270 | 136 | |||||||
Total of IBNR liabilities plus expected development on reported claims | 38 | |||||||||
Reinsurance | Property excluding property catastrophe | 2022 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 668 | 742 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 361 | 143 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | 119 | |||||||||
Reinsurance | Property excluding property catastrophe | 2023 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 835 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 152 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | 414 | |||||||||
Reinsurance | Marine and aviation | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 611 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 271 | |||||||||
All outstanding liabilities before 2014, net of reinsurance | 17 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 357 | |||||||||
Reinsurance | Marine and aviation | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 18 | 19 | 22 | 22 | 23 | 23 | 25 | 27 | 29 | 31 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 17 | 17 | 16 | 16 | 15 | 15 | 12 | 11 | 8 | 4 |
Total of IBNR liabilities plus expected development on reported claims | 0 | |||||||||
Reinsurance | Marine and aviation | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 24 | 25 | 27 | 28 | 30 | 31 | 32 | 37 | 33 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 22 | 22 | 22 | 22 | 22 | 21 | 19 | 13 | 0 | |
Total of IBNR liabilities plus expected development on reported claims | 1 | |||||||||
Reinsurance | Marine and aviation | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 11 | 12 | 15 | 17 | 19 | 23 | 23 | 27 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 7 | 7 | 7 | 6 | 3 | 0 | (2) | (7) | ||
Total of IBNR liabilities plus expected development on reported claims | 3 | |||||||||
Reinsurance | Marine and aviation | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 15 | 17 | 20 | 21 | 24 | 26 | 29 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 12 | 12 | 12 | 11 | 9 | 6 | 2 | |||
Total of IBNR liabilities plus expected development on reported claims | 3 | |||||||||
Reinsurance | Marine and aviation | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 21 | 21 | 24 | 24 | 26 | 27 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 15 | 14 | 13 | 11 | 7 | 2 | ||||
Total of IBNR liabilities plus expected development on reported claims | 3 | |||||||||
Reinsurance | Marine and aviation | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 62 | 61 | 60 | 55 | 48 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 43 | 35 | 29 | 21 | 11 | |||||
Total of IBNR liabilities plus expected development on reported claims | 9 | |||||||||
Reinsurance | Marine and aviation | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 80 | 79 | 76 | 83 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 60 | 42 | 26 | 9 | ||||||
Total of IBNR liabilities plus expected development on reported claims | 10 | |||||||||
Reinsurance | Marine and aviation | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 81 | 96 | 110 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 45 | 24 | 8 | |||||||
Total of IBNR liabilities plus expected development on reported claims | 18 | |||||||||
Reinsurance | Marine and aviation | 2022 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 138 | 126 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 37 | 12 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | 59 | |||||||||
Reinsurance | Marine and aviation | 2023 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 161 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 13 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | 127 | |||||||||
Reinsurance | Other specialty | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 5,483 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 3,408 | |||||||||
All outstanding liabilities before 2014, net of reinsurance | 19 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 2,094 | |||||||||
Reinsurance | Other specialty | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 295 | 296 | 298 | 304 | 308 | 307 | 312 | 318 | 316 | 337 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 282 | 280 | 278 | 275 | 271 | 258 | 248 | 229 | 186 | $ 96 |
Total of IBNR liabilities plus expected development on reported claims | 1 | |||||||||
Reinsurance | Other specialty | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 255 | 258 | 259 | 270 | 273 | 273 | 276 | 278 | 280 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 241 | 240 | 239 | 236 | 224 | 211 | 197 | 162 | $ 83 | |
Total of IBNR liabilities plus expected development on reported claims | 3 | |||||||||
Reinsurance | Other specialty | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 307 | 306 | 309 | 314 | 307 | 316 | 323 | 326 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 293 | 289 | 283 | 277 | 261 | 242 | 205 | $ 108 | ||
Total of IBNR liabilities plus expected development on reported claims | 6 | |||||||||
Reinsurance | Other specialty | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 363 | 366 | 370 | 372 | 372 | 390 | 398 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 346 | 337 | 326 | 313 | 298 | 256 | $ 136 | |||
Total of IBNR liabilities plus expected development on reported claims | 15 | |||||||||
Reinsurance | Other specialty | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 423 | 424 | 428 | 404 | 409 | 416 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 376 | 353 | 336 | 315 | 276 | $ 130 | ||||
Total of IBNR liabilities plus expected development on reported claims | 29 | |||||||||
Reinsurance | Other specialty | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 405 | 395 | 400 | 406 | 427 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 325 | 303 | 277 | 211 | $ 121 | |||||
Total of IBNR liabilities plus expected development on reported claims | 40 | |||||||||
Reinsurance | Other specialty | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 539 | 519 | 524 | 593 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 405 | 370 | 293 | $ 134 | ||||||
Total of IBNR liabilities plus expected development on reported claims | 61 | |||||||||
Reinsurance | Other specialty | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 613 | 611 | 610 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 432 | 311 | $ 152 | |||||||
Total of IBNR liabilities plus expected development on reported claims | 80 | |||||||||
Reinsurance | Other specialty | 2022 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 935 | 953 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 464 | $ 182 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | 225 | |||||||||
Reinsurance | Other specialty | 2023 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 1,348 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 244 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 817 |
Short Duration Contracts - Cl_3
Short Duration Contracts - Claims development - Mortgage (Details) $ in Millions | Dec. 31, 2023 USD ($) claims | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2019 USD ($) | Dec. 31, 2018 USD ($) | Dec. 31, 2017 USD ($) | Dec. 31, 2016 USD ($) | Dec. 31, 2015 USD ($) | Dec. 31, 2014 USD ($) |
Claims Development [Line Items] | ||||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | $ 15,700 | |||||||||
Mortgage | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 1,092 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 790 | |||||||||
All outstanding liabilities before 2012, net of reinsurance | 8 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 310 | |||||||||
Mortgage | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | 259 | $ 261 | $ 263 | $ 263 | $ 261 | $ 266 | $ 266 | $ 279 | $ 297 | $ 316 |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 258 | 257 | 257 | 256 | 254 | 247 | 234 | 202 | 129 | $ 20 |
Total of IBNR liabilities plus expected development on reported claims | $ 0 | |||||||||
Cumulative number of paid claims | claims | 6,332 | |||||||||
Mortgage | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 188 | 189 | 191 | 191 | 189 | 195 | 198 | 197 | 223 | |
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 186 | 185 | 184 | 183 | 180 | 171 | 151 | 92 | $ 16 | |
Total of IBNR liabilities plus expected development on reported claims | $ 0 | |||||||||
Cumulative number of paid claims | claims | 4,588 | |||||||||
Mortgage | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 136 | 137 | 142 | 142 | 141 | 149 | 171 | 184 | ||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 133 | 132 | 132 | 131 | 127 | 113 | 72 | $ 11 | ||
Total of IBNR liabilities plus expected development on reported claims | $ 0 | |||||||||
Cumulative number of paid claims | claims | 3,462 | |||||||||
Mortgage | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 99 | 102 | 109 | 108 | 107 | 132 | 179 | |||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 93 | 92 | 90 | 87 | 79 | 48 | $ 9 | |||
Total of IBNR liabilities plus expected development on reported claims | $ 0 | |||||||||
Cumulative number of paid claims | claims | 2,541 | |||||||||
Mortgage | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 69 | 72 | 88 | 89 | 96 | 132 | ||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 60 | 59 | 56 | 50 | 31 | $ 4 | ||||
Total of IBNR liabilities plus expected development on reported claims | $ 0 | |||||||||
Cumulative number of paid claims | claims | 1,763 | |||||||||
Mortgage | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 51 | 63 | 110 | 119 | 108 | |||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 39 | 34 | 29 | 20 | $ 3 | |||||
Total of IBNR liabilities plus expected development on reported claims | $ 0 | |||||||||
Cumulative number of paid claims | claims | 1,149 | |||||||||
Mortgage | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 33 | 78 | 374 | 420 | ||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 13 | 8 | 4 | $ 1 | ||||||
Total of IBNR liabilities plus expected development on reported claims | $ 0 | |||||||||
Cumulative number of paid claims | claims | 492 | |||||||||
Mortgage | 2021 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 20 | 77 | 144 | |||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 5 | 2 | $ 0 | |||||||
Total of IBNR liabilities plus expected development on reported claims | $ 0 | |||||||||
Cumulative number of paid claims | claims | 211 | |||||||||
Mortgage | 2022 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 55 | 173 | ||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 3 | $ 0 | ||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 0 | |||||||||
Cumulative number of paid claims | claims | 135 | |||||||||
Mortgage | 2023 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and allocated loss adjustment expenses, net of reinsurance | $ 182 | |||||||||
Cumulative paid losses and allocated loss adjustment expenses, net of reinsurance | 0 | |||||||||
Total of IBNR liabilities plus expected development on reported claims | $ 1 | |||||||||
Cumulative number of paid claims | claims | 9 |
Short Duration Contracts - Perc
Short Duration Contracts - Percentage annual payout - all segments (Details) | Dec. 31, 2023 |
Insurance | Property, energy, marine and aviation | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 20.50% |
Year Two | 43.70% |
Year Three | 18.10% |
Year Four | 6% |
Year Five | 2.20% |
Year Six | 1% |
Year Seven | 2.60% |
Year Eight | 1.90% |
Year Nine | (0.40%) |
Year Ten | 1.50% |
Insurance | Third party occurrence business | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 3.50% |
Year Two | 9.40% |
Year Three | 11.50% |
Year Four | 11.40% |
Year Five | 9.90% |
Year Six | 9.80% |
Year Seven | 5.60% |
Year Eight | 4.60% |
Year Nine | 4.40% |
Year Ten | 5.60% |
Insurance | Third party claims-made business | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 4.10% |
Year Two | 15.50% |
Year Three | 16.50% |
Year Four | 11.10% |
Year Five | 14.30% |
Year Six | 10.10% |
Year Seven | 6.30% |
Year Eight | 5.20% |
Year Nine | 5.70% |
Year Ten | 2% |
Insurance | Multi-line and other specialty | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 34% |
Year Two | 29.30% |
Year Three | 11.30% |
Year Four | 8.20% |
Year Five | 4.50% |
Year Six | 2.90% |
Year Seven | 1.10% |
Year Eight | 0.40% |
Year Nine | 0.40% |
Year Ten | 0.50% |
Reinsurance | Casualty | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 2.80% |
Year Two | 7.70% |
Year Three | 12.10% |
Year Four | 10.40% |
Year Five | 11.40% |
Year Six | 8.50% |
Year Seven | 7.80% |
Year Eight | 5.30% |
Year Nine | 5.20% |
Year Ten | 2.90% |
Reinsurance | Property catastrophe | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 56% |
Year Two | (17.50%) |
Year Three | 47.20% |
Year Four | (41.90%) |
Year Five | (6.20%) |
Year Six | 10.90% |
Year Seven | 2.40% |
Year Eight | 1.10% |
Year Nine | (1.70%) |
Year Ten | 0% |
Reinsurance | Property excluding property catastrophe | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 25% |
Year Two | 38.20% |
Year Three | 14.20% |
Year Four | 6% |
Year Five | 4.40% |
Year Six | 0.20% |
Year Seven | 0.70% |
Year Eight | 0.10% |
Year Nine | 0.40% |
Year Ten | 0.40% |
Reinsurance | Marine and aviation | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 3% |
Year Two | 28.80% |
Year Three | 20% |
Year Four | 13% |
Year Five | 10.60% |
Year Six | 3.40% |
Year Seven | 2.20% |
Year Eight | 1% |
Year Nine | 3.80% |
Year Ten | 0.40% |
Reinsurance | Other specialty | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 28.60% |
Year Two | 29.90% |
Year Three | 13.90% |
Year Four | 5.70% |
Year Five | 4.50% |
Year Six | 3.90% |
Year Seven | 1.70% |
Year Eight | 0.90% |
Year Nine | 0.60% |
Year Ten | 1% |
Mortgage | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year One | 5.10% |
Year Two | 29.10% |
Year Three | 24.20% |
Year Four | 10.70% |
Year Five | 4.70% |
Year Six | 1.80% |
Year Seven | 0.70% |
Year Eight | 0.50% |
Year Nine | 0.20% |
Year Ten | 0.10% |
Short Duration Contracts - Reco
Short Duration Contracts - Reconciliation of claims development to liability (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | $ 15,700 | ||||
Unpaid losses and loss adjustment expenses recoverable | 6,690 | $ 6,280 | $ 5,599 | $ 4,315 | |
Lines other than short duration | 132 | ||||
Discounting | (66) | ||||
Unallocated claims adjustment expenses | 296 | ||||
Total reconciling items | 362 | ||||
Reserve for losses and loss adjustment expenses | 22,752 | $ 20,032 | $ 17,757 | $ 16,514 | |
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 | 284 | ||||
Unpaid losses and loss adjustment expenses recoverable | [1] | 468 | |||
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] | 225 | |||
Total for short duration lines | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Unpaid losses and loss adjustment expenses recoverable | 6,690 | ||||
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 | 824 | ||||
Unpaid losses and loss adjustment expenses recoverable | 359 | ||||
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 | 3,601 | ||||
Unpaid losses and loss adjustment expenses recoverable | 2,025 | ||||
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 | 2,352 | ||||
Unpaid losses and loss adjustment expenses recoverable | 1,001 | ||||
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 | 1,348 | ||||
Unpaid losses and loss adjustment expenses recoverable | 246 | ||||
Reinsurance | Casualty | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 2,706 | ||||
Unpaid losses and loss adjustment expenses recoverable | 738 | ||||
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 | 563 | ||||
Unpaid losses and loss adjustment expenses recoverable | 519 | ||||
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 | 1,261 | ||||
Unpaid losses and loss adjustment expenses recoverable | 239 | ||||
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 | 357 | ||||
Unpaid losses and loss adjustment expenses recoverable | 240 | ||||
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 | 2,094 | ||||
Unpaid losses and loss adjustment expenses recoverable | 828 | ||||
Mortgage | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 310 | ||||
Unpaid losses and loss adjustment expenses recoverable | 33 | ||||
Consolidating adjustments and eliminations | |||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||||
Unpaid losses and loss adjustment expenses recoverable | $ (6) | ||||
[1]Includes unpaid loss and loss adjustment expenses recoverable of $225 million related to the loss portfolio transfer reinsurance agreements. |
Short Duration Contracts (Detai
Short Duration Contracts (Details) | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
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 Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Credit Loss [Abstract] | |||
Balance at beginning of period | $ 3,625 | $ 2,633 | |
Balance at end of period | 4,644 | 3,625 | |
Allowance for Expected Credit Losses | |||
Balance at beginning of period | 35 | 40 | |
Change for provision of expected credit losses | [1] | (1) | (5) |
Balance at end of period | 34 | 35 | |
Write-offs charged against the allowance | $ 3 | $ 11 | |
[1]Amounts deemed uncollectible are written-off in operating expenses. For the 2023 and 2022 periods, amounts written off totaled $3 million and $11 million, respectively. |
Allowance for Expected Credit_4
Allowance for Expected Credit Losses - Reinsurance recoverables (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Credit Loss [Abstract] | ||
Balance at beginning of period | $ 6,564 | $ 5,881 |
Balance at end of period | 7,064 | 6,564 |
Allowance for Expected Credit Losses | ||
Balance at beginning of period | 22 | 13 |
Change for provision of expected credit losses | (1) | 9 |
Balance at end of period | $ 21 | $ 22 |
Allowance for Expected Credit_5
Allowance for Expected Credit Losses - Ceded credit risk (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Concentration Risk [Line Items] | ||||
Reinsurance recoverable for paid and unpaid claims and claims adjustments | $ 7,064 | $ 6,564 | $ 5,881 | |
Shareholders' equity | Reinsurer concentration risk | Largest balance due from any one carrier | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 7.20% | 9% | ||
AM Best "A-" Or Better Rating | Reinsurance recoverable | Reinsurer concentration risk | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 66.80% | 68.80% | ||
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 | Reinsurance trusts or letters of credit | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 95% | 95% | ||
No AM Best rating | Reinsurance recoverable | Reinsurer concentration risk | All Other Carriers | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | [1] | 33.10% | 31.10% | |
[1]At December 31, 2023 and 2022 period, over 95% of such amount were 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 Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Credit Loss [Abstract] | ||
Balance at beginning of period | $ 1,731 | $ 1,829 |
Balance at end of period | 1,814 | 1,731 |
Allowance for Expected Credit Losses | ||
Balance at beginning of period | 3 | 3 |
Change for provision of expected credit losses | 0 | 0 |
Balance at end of period | $ 3 | $ 3 |
Reinsurance - Effects of reinsu
Reinsurance - Effects of reinsurance (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Premiums Written | |||
Direct | $ 9,652 | $ 8,542 | $ 7,707 |
Assumed | 8,751 | 6,785 | 5,045 |
Ceded | (4,935) | (4,249) | (3,735) |
Net premiums written | 13,468 | 11,078 | 9,017 |
Premiums Earned | |||
Direct | 9,131 | 8,058 | 7,150 |
Assumed | 7,890 | 5,768 | 4,334 |
Ceded | (4,581) | (4,147) | (3,402) |
Net premiums earned | 12,440 | 9,679 | 8,082 |
Losses and Loss Adjustment Expenses | |||
Direct | 4,739 | 3,991 | 4,267 |
Assumed | 3,975 | 3,558 | 2,826 |
Ceded | (2,468) | (2,521) | (2,508) |
Net | $ 6,246 | $ 5,028 | $ 4,585 |
Reinsurance - Coverage and rete
Reinsurance - Coverage and retention (Details) - Variable Interest Entity, Not Primary Beneficiary $ in Millions | 12 Months Ended | |
Dec. 31, 2023 USD ($) | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | $ 2,559 | |
Current Coverage | 1,553 | |
Remaining Retention, Net | $ 1,017 | |
Amortization period | 10 years | |
Bellemeade 2019-1 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | $ 342 | [1] |
Current Coverage | 71 | [1] |
Remaining Retention, Net | 134 | [1] |
Bellemeade 2019-3 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 701 | [2] |
Current Coverage | 99 | [2] |
Remaining Retention, Net | 218 | [2] |
Bellemeade 2021-3 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 639 | [3] |
Current Coverage | 541 | [3] |
Remaining Retention, Net | 134 | [3] |
Bellemeade 2021-3 Ltd | Funded By VIE | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 508 | |
Bellemeade 2021-3 Ltd | Directly provided capacity | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 131 | |
Bellemeade 2022-1 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 317 | [4] |
Current Coverage | 282 | [4] |
Remaining Retention, Net | 141 | [4] |
Bellemeade 2022-1 Ltd | Funded By VIE | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 284 | |
Bellemeade 2022-1 Ltd | Directly provided capacity | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 33 | |
Bellemeade 2022-2 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 327 | [5] |
Current Coverage | 327 | [5] |
Remaining Retention, Net | 205 | [5] |
Bellemeade 2022-2 Ltd | Funded By VIE | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 201 | |
Bellemeade 2022-2 Ltd | Directly provided capacity | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 126 | |
Bellemeade 2023-1 Ltd | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 233 | [6] |
Current Coverage | 233 | [6] |
Remaining Retention, Net | 185 | [6] |
Bellemeade 2023-1 Ltd | Funded By VIE | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | 187 | |
Bellemeade 2023-1 Ltd | Directly provided capacity | ||
Variable Interest Entity [Line Items] | ||
Initial Coverage at Issuance | $ 47 | |
[1]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.[2]Issued in July 2019, covering in-force policies issued in 2016.[3]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[4]Issued in January 2022, covering in-force policies issued between July 1, 2021 and November 30, 2021. $284 million was directly funded by Bellemeade Re 2022-1 Ltd. via insurance-linked notes, with an additional $33 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers . |
Investment Information - Summar
Investment Information - Summary of available for sale securities (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Available for sale securities: | |||
Estimated fair value | $ 25,616 | $ 21,015 | |
Gross Unrealized Gains | 276 | 90 | |
Gross Unrealized Losses | (827) | (1,649) | |
Allowance for Expected Credit Losses | (28) | (41) | |
Cost or Amortized Cost | 26,195 | 22,615 | |
Fixed maturities available for sale, at fair value | |||
Available for sale securities: | |||
Estimated fair value | 23,553 | 19,683 | |
Gross Unrealized Gains | 275 | 89 | |
Gross Unrealized Losses | (825) | (1,647) | |
Allowance for Expected Credit Losses | (28) | (41) | $ (3) |
Cost or Amortized Cost | 24,131 | 21,282 | |
Corporate bonds | |||
Available for sale securities: | |||
Estimated fair value | 10,855 | 8,020 | |
Gross Unrealized Gains | 157 | 55 | |
Gross Unrealized Losses | (464) | (781) | |
Allowance for Expected Credit Losses | (20) | (30) | |
Cost or Amortized Cost | 11,182 | 8,776 | |
US government and government agencies | |||
Available for sale securities: | |||
Estimated fair value | 5,814 | 5,162 | |
Gross Unrealized Gains | 63 | 15 | |
Gross Unrealized Losses | (86) | (343) | |
Allowance for Expected Credit Losses | 0 | 0 | |
Cost or Amortized Cost | 5,837 | 5,490 | |
Asset backed securities | |||
Available for sale securities: | |||
Estimated fair value | 2,250 | 1,927 | |
Gross Unrealized Gains | 11 | 1 | |
Gross Unrealized Losses | (55) | (107) | |
Allowance for Expected Credit Losses | (5) | (6) | |
Cost or Amortized Cost | 2,299 | 2,039 | |
Non-US government securities | |||
Available for sale securities: | |||
Estimated fair value | 2,062 | 2,313 | |
Gross Unrealized Gains | 33 | 9 | |
Gross Unrealized Losses | (100) | (238) | |
Allowance for Expected Credit Losses | (1) | (2) | $ 0 |
Cost or Amortized Cost | 2,130 | 2,544 | |
Commercial mortgage backed securities | |||
Available for sale securities: | |||
Estimated fair value | 1,213 | 1,047 | |
Gross Unrealized Gains | 3 | 1 | |
Gross Unrealized Losses | (34) | (58) | |
Allowance for Expected Credit Losses | (2) | (3) | |
Cost or Amortized Cost | 1,246 | 1,107 | |
Mortgage backed securities | |||
Available for sale securities: | |||
Estimated fair value | 1,103 | 795 | |
Gross Unrealized Gains | 7 | 5 | |
Gross Unrealized Losses | (66) | (87) | |
Allowance for Expected Credit Losses | 0 | 0 | |
Cost or Amortized Cost | 1,162 | 877 | |
Municipal bonds | |||
Available for sale securities: | |||
Estimated fair value | 256 | 419 | |
Gross Unrealized Gains | 1 | 3 | |
Gross Unrealized Losses | (20) | (33) | |
Allowance for Expected Credit Losses | 0 | 0 | |
Cost or Amortized Cost | 275 | 449 | |
Short-term investments | |||
Available for sale securities: | |||
Estimated fair value | 2,063 | 1,332 | |
Gross Unrealized Gains | 1 | 1 | |
Gross Unrealized Losses | (2) | (2) | |
Allowance for Expected Credit Losses | 0 | 0 | |
Cost or Amortized Cost | $ 2,064 | $ 1,333 |
Investment Information - Aging
Investment Information - Aging of available for sale securities in an unrealized loss position (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Available for sale securities: | ||
Estimated Fair Value - Less than 12 Months | $ 3,867 | $ 12,976 |
Gross Unrealized Losses - Less than 12 Months | (67) | (929) |
Estimated Fair Value - 12 Months or More | 9,555 | 5,671 |
Gross Unrealized Losses - 12 Months or More | (760) | (720) |
Estimated Fair Value - Total | 13,422 | 18,647 |
Gross Unrealized Losses - Total | (827) | (1,649) |
Fixed maturities available for sale, at fair value | ||
Available for sale securities: | ||
Estimated Fair Value - Less than 12 Months | 3,565 | 12,739 |
Gross Unrealized Losses - Less than 12 Months | (65) | (927) |
Estimated Fair Value - 12 Months or More | 9,555 | 5,671 |
Gross Unrealized Losses - 12 Months or More | (760) | (720) |
Estimated Fair Value - Total | 13,120 | 18,410 |
Gross Unrealized Losses - Total | (825) | (1,647) |
Corporate bonds | ||
Available for sale securities: | ||
Estimated Fair Value - Less than 12 Months | 1,559 | 4,823 |
Gross Unrealized Losses - Less than 12 Months | (45) | (393) |
Estimated Fair Value - 12 Months or More | 4,959 | 2,559 |
Gross Unrealized Losses - 12 Months or More | (419) | (388) |
Estimated Fair Value - Total | 6,518 | 7,382 |
Gross Unrealized Losses - Total | (464) | (781) |
US government and government agencies | ||
Available for sale securities: | ||
Estimated Fair Value - Less than 12 Months | 1,066 | 3,557 |
Gross Unrealized Losses - Less than 12 Months | (10) | (197) |
Estimated Fair Value - 12 Months or More | 941 | 1,443 |
Gross Unrealized Losses - 12 Months or More | (76) | (146) |
Estimated Fair Value - Total | 2,007 | 5,000 |
Gross Unrealized Losses - Total | (86) | (343) |
Non-US government securities | ||
Available for sale securities: | ||
Estimated Fair Value - Less than 12 Months | 365 | 1,703 |
Gross Unrealized Losses - Less than 12 Months | (4) | (154) |
Estimated Fair Value - 12 Months or More | 897 | 542 |
Gross Unrealized Losses - 12 Months or More | (96) | (84) |
Estimated Fair Value - Total | 1,262 | 2,245 |
Gross Unrealized Losses - Total | (100) | (238) |
Mortgage backed securities | ||
Available for sale securities: | ||
Estimated Fair Value - Less than 12 Months | 221 | 546 |
Gross Unrealized Losses - Less than 12 Months | (3) | (52) |
Estimated Fair Value - 12 Months or More | 522 | 154 |
Gross Unrealized Losses - 12 Months or More | (63) | (35) |
Estimated Fair Value - Total | 743 | 700 |
Gross Unrealized Losses - Total | (66) | (87) |
Asset backed securities | ||
Available for sale securities: | ||
Estimated Fair Value - Less than 12 Months | 234 | 1,148 |
Gross Unrealized Losses - Less than 12 Months | (1) | (66) |
Estimated Fair Value - 12 Months or More | 1,112 | 512 |
Gross Unrealized Losses - 12 Months or More | (54) | (41) |
Estimated Fair Value - Total | 1,346 | 1,660 |
Gross Unrealized Losses - Total | (55) | (107) |
Commercial mortgage backed securities | ||
Available for sale securities: | ||
Estimated Fair Value - Less than 12 Months | 100 | 598 |
Gross Unrealized Losses - Less than 12 Months | (1) | (35) |
Estimated Fair Value - 12 Months or More | 909 | 445 |
Gross Unrealized Losses - 12 Months or More | (33) | (23) |
Estimated Fair Value - Total | 1,009 | 1,043 |
Gross Unrealized Losses - Total | (34) | (58) |
Municipal bonds | ||
Available for sale securities: | ||
Estimated Fair Value - Less than 12 Months | 20 | 364 |
Gross Unrealized Losses - Less than 12 Months | (1) | (30) |
Estimated Fair Value - 12 Months or More | 215 | 16 |
Gross Unrealized Losses - 12 Months or More | (19) | (3) |
Estimated Fair Value - Total | 235 | 380 |
Gross Unrealized Losses - Total | (20) | (33) |
Short-term investments | ||
Available for sale securities: | ||
Estimated Fair Value - Less than 12 Months | 302 | 237 |
Gross Unrealized Losses - Less than 12 Months | (2) | (2) |
Estimated Fair Value - 12 Months or More | 0 | 0 |
Gross Unrealized Losses - 12 Months or More | 0 | 0 |
Estimated Fair Value - Total | 302 | 237 |
Gross Unrealized Losses - Total | $ (2) | $ (2) |
Investment Information - Maturi
Investment Information - Maturity profile of available for sale securities (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Estimated Fair Value: | ||
Estimated fair value | $ 25,616 | $ 21,015 |
Amortized Cost: | ||
Amortized cost | 26,195 | 22,615 |
Fixed maturities available for sale, at fair value | ||
Estimated Fair Value: | ||
Due in one year or less | 480 | 511 |
Due after one year through five years | 12,924 | 11,016 |
Due after five years through 10 years | 5,249 | 3,984 |
Due after 10 years | 334 | 403 |
Single maturity date | 18,987 | 15,914 |
Estimated fair value | 23,553 | 19,683 |
Amortized Cost: | ||
Due in one year or less | 499 | 537 |
Due after one year through five years | 13,101 | 11,715 |
Due after five years through 10 years | 5,450 | 4,527 |
Due after 10 years | 374 | 480 |
Single maturity date | 19,424 | 17,259 |
Amortized cost | 24,131 | 21,282 |
Mortgage backed securities | ||
Estimated Fair Value: | ||
Securities without single maturity date | 1,103 | 795 |
Estimated fair value | 1,103 | 795 |
Amortized Cost: | ||
Securities without single maturity date | 1,162 | 877 |
Amortized cost | 1,162 | 877 |
Commercial mortgage backed securities | ||
Estimated Fair Value: | ||
Securities without single maturity date | 1,213 | 1,047 |
Estimated fair value | 1,213 | 1,047 |
Amortized Cost: | ||
Securities without single maturity date | 1,246 | 1,107 |
Amortized cost | 1,246 | 1,107 |
Asset backed securities | ||
Estimated Fair Value: | ||
Securities without single maturity date | 2,250 | 1,927 |
Estimated fair value | 2,250 | 1,927 |
Amortized Cost: | ||
Securities without single maturity date | 2,299 | 2,039 |
Amortized cost | $ 2,299 | $ 2,039 |
Investment Information - Net in
Investment Information - Net investment Income (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Net investment income: | ||||
Gross investment income | $ 1,100 | $ 567 | $ 478 | |
Investment expenses | (77) | (71) | (89) | |
Net investment income | 1,023 | 496 | 389 | |
Fixed maturities available for sale, at fair value (amortized cost: $24,131 and $21,282; net of allowance for credit losses: $28 and $41) | ||||
Net investment income: | ||||
Gross investment income | 917 | 469 | 331 | |
Short-term investments | ||||
Net investment income: | ||||
Gross investment income | 68 | 29 | 7 | |
Equity securities | ||||
Net investment income: | ||||
Gross investment income | 22 | 22 | 42 | |
Term loan investments | ||||
Net investment income: | ||||
Gross investment income | 0 | 0 | 30 | |
Other | ||||
Net investment income: | ||||
Gross investment income | [1] | $ 93 | $ 47 | $ 68 |
[1]Includes interest income on operating cash, distributions from investment funds and other items. |
Investment Information - Net re
Investment Information - Net realized gains and losses (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Net realized gains and losses: | ||||
Available for sale securities, gross gains on investment sales | $ 116 | $ 81 | $ 314 | |
Available for sale securities, gross losses on investment sales | (547) | (317) | (157) | |
Equity securities at fair value, net realized gains (losses) on sales during the period | 61 | 75 | 123 | |
Equity securities at fair value, net unrealized gains (losses) on equity securities still held at reporting date | 88 | (267) | 49 | |
Allowance for credit losses - investment related | 3 | (44) | (1) | |
Allowance for credit losses - underwriting related | (1) | (13) | 0 | |
Derivative instruments | 59 | (75) | (33) | |
Other | [1] | 10 | (4) | (55) |
Net realized gains (losses) | $ (165) | $ (663) | $ 380 | |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Net realized gains (losses) | Net realized gains (losses) | Net realized gains (losses) | |
Somers Holdings Ltd. | ||||
Net realized gains and losses: | ||||
Gain (loss) on deconsolidation | $ 33 | |||
Fixed maturities | ||||
Net realized gains and losses: | ||||
Change in fair value of assets and liabilities accounted for using the fair value option | $ 18 | $ (71) | 9 | |
Other investments | ||||
Net realized gains and losses: | ||||
Change in fair value of assets and liabilities accounted for using the fair value option | 27 | (21) | 117 | |
Equity securities | ||||
Net realized gains and losses: | ||||
Change in fair value of assets and liabilities accounted for using the fair value option | 1 | (4) | 13 | |
Short-term investments | ||||
Net realized gains and losses: | ||||
Change in fair value of assets and liabilities accounted for using the fair value option | $ 0 | $ (3) | $ 1 | |
[1]2021 period reflected $33 million of losses related to the Company’sdeconsolidation of Somers |
Investment Information - Other
Investment Information - Other investments (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Other investments | $ 2,488 | $ 1,644 |
Other investments | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Other investments | 1,777 | 1,043 |
Fixed maturities | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Other investments | 683 | 554 |
Equity securities | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Other investments | 7 | 14 |
Short-term investments | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Other investments | $ 21 | $ 33 |
Investment Information - Othe_2
Investment Information - Other investments by strategy (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule Of Other Investments [Line Items] | ||
Other investments | $ 2,488 | $ 1,644 |
Other investments | ||
Schedule Of Other Investments [Line Items] | ||
Other investments | 1,777 | 1,043 |
Lending | ||
Schedule Of Other Investments [Line Items] | ||
Other investments | 427 | 406 |
Investment grade fixed income | ||
Schedule Of Other Investments [Line Items] | ||
Other investments | 754 | 271 |
Term loan investments | ||
Schedule Of Other Investments [Line Items] | ||
Other investments | 272 | 164 |
Private equity | ||
Schedule Of Other Investments [Line Items] | ||
Other investments | 182 | 123 |
Credit related funds | ||
Schedule Of Other Investments [Line Items] | ||
Other investments | 124 | 56 |
Energy | ||
Schedule Of Other Investments [Line Items] | ||
Other investments | $ 18 | $ 23 |
Investment Information - Equity
Investment Information - Equity method investments and investments in affiliates (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Equity Method Investments [Line Items] | |||
Investments accounted for using the equity method | $ 4,566 | $ 3,774 | |
Equity in net income (loss) of investment funds accounted for using the equity method | 278 | 115 | $ 366 |
Balance sheet: | |||
Total assets | 58,906 | 47,990 | 45,101 |
Total liabilities | 40,551 | 35,069 | 31,546 |
Income statement: | |||
Total revenues | 13,634 | 9,613 | 9,248 |
Net income | 4,442 | 1,482 | 2,239 |
Credit related funds | |||
Schedule of Equity Method Investments [Line Items] | |||
Investments accounted for using the equity method | 1,258 | 1,136 | |
Private equity | |||
Schedule of Equity Method Investments [Line Items] | |||
Investments accounted for using the equity method | 1,175 | 917 | |
Real estate | |||
Schedule of Equity Method Investments [Line Items] | |||
Investments accounted for using the equity method | 666 | 535 | |
Lending | |||
Schedule of Equity Method Investments [Line Items] | |||
Investments accounted for using the equity method | 597 | 531 | |
Infrastructure | |||
Schedule of Equity Method Investments [Line Items] | |||
Investments accounted for using the equity method | 320 | 245 | |
Fixed income | |||
Schedule of Equity Method Investments [Line Items] | |||
Investments accounted for using the equity method | 277 | 130 | |
Equity Funds | |||
Schedule of Equity Method Investments [Line Items] | |||
Investments accounted for using the equity method | 178 | 169 | |
Energy | |||
Schedule of Equity Method Investments [Line Items] | |||
Investments accounted for using the equity method | 95 | 111 | |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | |||
Balance sheet: | |||
Invested assets | 91,534 | 74,961 | |
Total assets | 108,952 | 88,063 | |
Total liabilities | 33,901 | 27,553 | |
Net assets | 75,051 | 60,510 | |
Income statement: | |||
Total revenues | 7,766 | 12,305 | 11,786 |
Total expenses | 7,174 | 5,374 | 3,239 |
Net income | $ 592 | $ 6,931 | $ 8,547 |
Investment Information - Limite
Investment Information - Limited partnership interests (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | |
Schedule of Equity Method Investments [Line Items] | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | $ 4,680 | $ 3,904 | |
Aggregate commitments | 3,600 | 2,900 | |
Equity method investments | |||
Schedule of Equity Method Investments [Line Items] | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | [1] | 4,566 | 3,774 |
Aggregate commitments | 3,400 | 2,600 | |
Fair value option | |||
Schedule of Equity Method Investments [Line Items] | |||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | [2] | 114 | 130 |
Aggregate commitments | $ 32 | $ 17 | |
[1]Aggregate unfunded commitments were $3.4 billion at December 31, 2023, consistent with $2.6 billion at December 31, 2022.[2]Aggregate unfunded commitments were $32 million at December 31, 2023, compared to $17 million at December 31, 2022. |
Investment Information - Invest
Investment Information - Investments in operating affiliates (Details) € / shares in Units, $ / shares in Units, € in Millions, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 EUR (€) € / shares | Jul. 01, 2021 $ / shares | |
Schedule of Equity Method Investments [Line Items] | |||||
Investment in operating affiliates | $ 1,119 | $ 965 | |||
Income (loss) from operating affiliates | $ 184 | 75 | $ 264 | ||
Coface | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Percentage ownership | 29.90% | 29.50% | 29.50% | ||
Investment in affiliate, price per share | € / shares | € 9.95 | ||||
Equity method investment, aggregate cost | $ 546 | € 453 | |||
Operating affiliate gain on acquisition | 75 | ||||
Operating affiliates , deferred gain on acquisition | $ 36 | ||||
Operating affiliates, deferred gain on acquisition, amortization period | 5 years | ||||
Investment in operating affiliates | $ 570 | 563 | |||
Coface | Issued Shares Excluding Treasury Stock | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Percentage ownership | 30.10% | ||||
Greysbridge Holdings Ltd | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Percentage ownership | 40% | ||||
Investment in affiliate, price per share | $ / shares | $ 35 | ||||
Equity method investment, aggregate cost | $ 279 | ||||
Operating affiliate gain on acquisition | 96 | ||||
Investment in operating affiliates | $ 430 | $ 306 | |||
Greysbridge Holdings Ltd | Kelso And Company | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Percentage ownership | 30% | ||||
Greysbridge Holdings Ltd | Warburg Pincus LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Percentage ownership | 30% | ||||
Somers Holdings Ltd. | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Gain (loss) on deconsolidation | $ 33 |
Investment Information - Allowa
Investment Information - Allowance for expected credit losses (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Line Items] | |||
Balance at beginning of period | $ 41 | ||
Balance at end of period | 28 | $ 41 | |
Fixed maturities | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Line Items] | |||
Balance at beginning of period | 41 | 3 | |
Additions for current-period provision for expected credit losses | 7 | 55 | |
Additions (reductions) for previously recognized expected credit losses | (10) | (13) | |
Reductions due to disposals | (10) | (4) | |
Balance at end of period | 28 | 41 | |
Structured securities | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Line Items] | |||
Balance at beginning of period | [1] | 9 | 1 |
Additions for current-period provision for expected credit losses | [1] | 2 | 14 |
Additions (reductions) for previously recognized expected credit losses | [1] | (3) | (4) |
Reductions due to disposals | [1] | (1) | (2) |
Balance at end of period | [1] | 7 | 9 |
Non-US government securities | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Line Items] | |||
Balance at beginning of period | 2 | 0 | |
Additions for current-period provision for expected credit losses | 0 | 2 | |
Additions (reductions) for previously recognized expected credit losses | 0 | 0 | |
Reductions due to disposals | (1) | 0 | |
Balance at end of period | 1 | 2 | |
Corporate bonds | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Line Items] | |||
Balance at beginning of period | 30 | 2 | |
Additions for current-period provision for expected credit losses | 5 | 39 | |
Additions (reductions) for previously recognized expected credit losses | (7) | (9) | |
Reductions due to disposals | (8) | (2) | |
Balance at end of period | $ 20 | $ 30 | |
[1]Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities. |
Investment Information - Restri
Investment Information - Restricted assets (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | |
Restricted Assets [Line Items] | |||
Restricted assets | $ 9,932 | $ 8,701 | |
Collateral or guarantees - affiliated transactions | |||
Restricted Assets [Line Items] | |||
Restricted assets | 4,854 | 4,254 | |
Collateral or guarantees - third party agreements | |||
Restricted Assets [Line Items] | |||
Restricted assets | 2,869 | 2,633 | |
Deposits with US regulatory authorities | |||
Restricted Assets [Line Items] | |||
Restricted assets | 833 | 776 | |
Deposits with non-US regulatory authorities | |||
Restricted Assets [Line Items] | |||
Restricted assets | [1] | $ 1,376 | $ 1,038 |
[1]Primarily includes Funds at Lloyds, deposits with non-U.S. regulatory authorities and other restricted assets. |
Investment Information - Cash a
Investment Information - Cash and restricted cash (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure Investment Information [Abstract] | ||||
Cash | $ 917 | $ 855 | $ 859 | |
Restricted cash (included in ‘other assets’) | 581 | 418 | 455 | |
Cash and restricted cash | $ 1,498 | $ 1,273 | $ 1,314 | $ 1,290 |
Investment Information - Narrat
Investment Information - Narrative (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 USD ($) lots | Dec. 31, 2022 USD ($) lots | |
Continuous unrealized loss, qualitative disclosures: | ||
Number of positions in an unrealized loss position (lots) | lots | 7,100 | 9,810 |
Total number of positions (lots) | lots | 15,720 | 12,590 |
Largest single loss | $ | $ 6 | $ 7 |
Equity securities, at fair value | $ | $ 1,186 | $ 860 |
Equity Method Investment, Financial Statement, Reported Amounts [Abstract] | ||
Investments, time lag for reporting - low end of range | 1 month | |
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 Millions | Dec. 31, 2023 | Dec. 31, 2022 | |
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 | $ 8,745 | $ 7,188 | |
Liabilities measured at fair value | 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) | Other liabilities | |||
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 | 0 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed maturities available for sale, at fair value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 5,792 | 5,145 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed maturities available for sale, at fair value | 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) | Fixed maturities available for sale, at fair value | US government and government agencies | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 5,792 | 5,145 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed maturities available for sale, at fair value | 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) | Fixed maturities available for sale, at fair value | 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) | Fixed maturities available for sale, at fair value | Commercial mortgage 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) | Fixed maturities available for sale, at fair value | Mortgage 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) | Fixed maturities available for sale, at fair value | Municipal 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) | Short-term investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 1,786 | 1,198 | |
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 | 1,151 | 829 | |
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 | 16 | 16 | |
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 | US government and government agencies | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 13 | 5 | |
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 | 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 | Short-term investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 0 | 1 | |
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 | 3 | 10 | |
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 | 0 | 0 | |
Significant Other Observable Inputs (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 18,927 | 15,474 | |
Liabilities measured at fair value | (119) | (76) | |
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 | (119) | (76) | |
Significant Other Observable Inputs (Level 2) | Other liabilities | |||
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) | Residential Mortgage | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 2 | 2 | |
Significant Other Observable Inputs (Level 2) | Fixed maturities available for sale, at fair value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 17,614 | 14,417 | |
Significant Other Observable Inputs (Level 2) | Fixed maturities available for sale, at fair value | Corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 10,708 | 7,899 | |
Significant Other Observable Inputs (Level 2) | Fixed maturities available for sale, at fair value | US government and government agencies | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 22 | 17 | |
Significant Other Observable Inputs (Level 2) | Fixed maturities available for sale, at fair value | Asset backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 2,250 | 1,927 | |
Significant Other Observable Inputs (Level 2) | Fixed maturities available for sale, at fair value | Non-US government securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 2,062 | 2,313 | |
Significant Other Observable Inputs (Level 2) | Fixed maturities available for sale, at fair value | Commercial mortgage backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 1,213 | 1,047 | |
Significant Other Observable Inputs (Level 2) | Fixed maturities available for sale, at fair value | Mortgage backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 1,103 | 795 | |
Significant Other Observable Inputs (Level 2) | Fixed maturities available for sale, at fair value | Municipal bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 256 | 419 | |
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 | 193 | 134 | |
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 | 30 | 28 | |
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 | 197 | 149 | |
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 | 891 | 744 | |
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 | 662 | 543 | |
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 | 0 | 0 | |
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 | 2 | 2 | |
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 | 6 | 4 | |
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 | 11 | 32 | |
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 | 0 | |
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 | 210 | 163 | |
Significant Unobservable Inputs (Level 3) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 356 | 161 | |
Liabilities measured at fair value | (22) | (14) | |
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) | Other liabilities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities measured at fair value | (22) | (14) | |
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 | 0 | |
Significant Unobservable Inputs (Level 3) | Fixed maturities available for sale, at fair value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 147 | 121 | |
Significant Unobservable Inputs (Level 3) | Fixed maturities available for sale, at fair value | Corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 147 | 121 | |
Significant Unobservable Inputs (Level 3) | Fixed maturities available for sale, at fair value | 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 | |
Significant Unobservable Inputs (Level 3) | Fixed maturities available for sale, at fair value | 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) | Fixed maturities available for sale, at fair value | 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) | Fixed maturities available for sale, at fair value | Commercial mortgage 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) | Fixed maturities available for sale, at fair value | Mortgage 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) | Fixed maturities available for sale, at fair value | Municipal bonds | |||
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) | Short-term investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 84 | 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 | 5 | 3 | |
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 | 120 | 37 | |
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 | 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 | 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 | 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 | Short-term investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 10 | 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 | 4 | |
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 | 106 | 33 | |
Estimated Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 29,489 | 23,670 | |
Liabilities measured at fair value | (141) | (90) | |
Estimated Fair Value | Derivative instruments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities measured at fair value | (119) | (76) | |
Estimated Fair Value | Other liabilities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities measured at fair value | (22) | (14) | |
Estimated Fair Value | Residential Mortgage | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 2 | 2 | |
Estimated Fair Value | Fixed maturities available for sale, at fair value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 23,553 | 19,683 | |
Estimated Fair Value | Fixed maturities available for sale, at fair value | Corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 10,855 | 8,020 | |
Estimated Fair Value | Fixed maturities available for sale, at fair value | US government and government agencies | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 5,814 | 5,162 | |
Estimated Fair Value | Fixed maturities available for sale, at fair value | Asset backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 2,250 | 1,927 | |
Estimated Fair Value | Fixed maturities available for sale, at fair value | Non-US government securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 2,062 | 2,313 | |
Estimated Fair Value | Fixed maturities available for sale, at fair value | Commercial mortgage backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 1,213 | 1,047 | |
Estimated Fair Value | Fixed maturities available for sale, at fair value | Mortgage backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 1,103 | 795 | |
Estimated Fair Value | Fixed maturities available for sale, at fair value | Municipal bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 256 | 419 | |
Estimated Fair Value | Short-term investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 2,063 | 1,332 | |
Estimated Fair Value | Equity securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 1,186 | 860 | |
Estimated Fair Value | Derivative instruments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 197 | 149 | |
Estimated Fair Value | Fair value option | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets measured at fair value | 2,488 | 1,644 | |
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 | 662 | 543 | |
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 | 13 | 5 | |
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 | 2 | 2 | |
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 | 6 | 4 | |
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 | 21 | 33 | |
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 | 7 | 14 | |
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 | 316 | 196 | |
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 | [1] | $ 1,461 | $ 847 |
[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. |
Fair Value - Rollforward of Lev
Fair Value - Rollforward of Level 3 assets and liabilities (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Other liabilities | |||
Level 3 liabilities rollforward | |||
Balance at beginning of year | $ (14) | $ (17) | |
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | (1) | 0 |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | 0 | 1 | |
Purchases, issuances, sales and settlements | |||
Purchases | 0 | 0 | |
Issuances | (9) | 0 | |
Sales | 0 | 0 | |
Settlements | 2 | 2 | |
Transfers in and/or out of Level 3 | 0 | 0 | |
Balance at end of year | (22) | (14) | |
Equity securities | |||
Level 3 assets rollforward | |||
Balance at beginning of year | 4 | 3 | |
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | 0 | 0 |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | 0 | 0 | |
Purchases, issuances, sales and settlements | |||
Purchases | 1 | 1 | |
Issuances | 0 | 0 | |
Sales | 0 | 0 | |
Settlements | 0 | 0 | |
Transfers in and/or out of Level 3 | 0 | 0 | |
Balance at end of year | 5 | 4 | |
Available for sale | Structured securities | |||
Level 3 assets rollforward | |||
Balance at beginning of year | [2] | 0 | 3 |
Total gains or (losses) (realized/unrealized) - included in earnings | [1],[2] | 0 | (1) |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | [2] | 0 | 0 |
Purchases, issuances, sales and settlements | |||
Purchases | [2] | 0 | 0 |
Issuances | [2] | 0 | 0 |
Sales | [2] | 0 | (2) |
Settlements | [2] | 0 | 0 |
Transfers in and/or out of Level 3 | [2] | 0 | 0 |
Balance at end of year | [2] | 0 | 0 |
Available for sale | Corporate bonds | |||
Level 3 assets rollforward | |||
Balance at beginning of year | 121 | 0 | |
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | 1 | 0 |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | (1) | (1) | |
Purchases, issuances, sales and settlements | |||
Purchases | 111 | 150 | |
Issuances | 0 | 0 | |
Sales | 0 | (6) | |
Settlements | (85) | (26) | |
Transfers in and/or out of Level 3 | 0 | 4 | |
Balance at end of year | 147 | 121 | |
Available for sale | Short-term investments | |||
Level 3 assets rollforward | |||
Balance at beginning of year | 0 | 0 | |
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | 0 | 0 |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | 0 | 0 | |
Purchases, issuances, sales and settlements | |||
Purchases | 84 | 0 | |
Issuances | 0 | 0 | |
Sales | 0 | 0 | |
Settlements | 0 | 0 | |
Transfers in and/or out of Level 3 | 0 | 0 | |
Balance at end of year | 84 | 0 | |
Fair value option | Other investments | |||
Level 3 assets rollforward | |||
Balance at beginning of year | 33 | 28 | |
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | (5) | (1) |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | 0 | 0 | |
Purchases, issuances, sales and settlements | |||
Purchases | 107 | 12 | |
Issuances | 0 | 0 | |
Sales | (10) | (3) | |
Settlements | (19) | (3) | |
Transfers in and/or out of Level 3 | 0 | 0 | |
Balance at end of year | 106 | 33 | |
Fair value option | Short-term investments | |||
Level 3 assets rollforward | |||
Balance at beginning of year | 0 | 0 | |
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | 0 | 0 |
Total gains or (losses) (realized/unrealized) - included in other comprehensive income | 0 | 0 | |
Purchases, issuances, sales and settlements | |||
Purchases | 11 | 0 | |
Issuances | 0 | 0 | |
Sales | 0 | 0 | |
Settlements | (1) | 0 | |
Transfers in and/or out of Level 3 | 0 | 0 | |
Balance at end of year | 10 | 0 | |
Fair value option | Equity securities | |||
Level 3 assets rollforward | |||
Balance at beginning of year | 4 | 5 | |
Total gains or (losses) (realized/unrealized) - included in earnings | [1] | 0 | (1) |
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 | 0 | 0 | |
Settlements | 0 | 0 | |
Transfers in and/or out of Level 3 | 0 | 0 | |
Balance at end of year | $ 4 | $ 4 | |
[1]Gains or losses were included in net realized gains (losses).[2]Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities |
Fair Value - Narrative (Details
Fair Value - Narrative (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior notes | $ 2,726 | $ 2,725 |
Total assets and liabilities measured at fair value | 29,600 | 23,800 |
Total assets and liabilities measured at fair value priced using non-binding broker quotes | $ 14 | $ 13 |
Total assets and liabilities measured at fair value priced using non-binding broker quotes (percentage) | 0% | 0.10% |
Unsecured debt | Senior Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior notes | $ 2,700 | $ 2,700 |
Estimated fair value of senior notes | $ 2,500 | $ 2,400 |
Derivative Instruments (Details
Derivative Instruments (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Derivative offsetting [Abstract] | ||||
Derivative assets subject to master netting agreements | $ 197 | $ 147 | ||
Derivative liabilities subject to master netting agreements | 119 | 73 | ||
Net realized gains (losses) on derivative instruments | ||||
Net realized gains (losses) on derivative instruments | 59 | (75) | $ (33) | |
Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Asset derivatives - fair value | 197 | 149 | ||
Liability derivatives - fair value | (119) | (76) | ||
Net realized gains (losses) on derivative instruments | ||||
Net realized gains (losses) on derivative instruments | 59 | (75) | (33) | |
Not Designated as Hedging Instrument | Futures contracts | ||||
Derivative [Line Items] | ||||
Net derivatives - notional value | [1] | 3,746 | 3,138 | |
Net realized gains (losses) on derivative instruments | ||||
Net realized gains (losses) on derivative instruments | 49 | (86) | (16) | |
Not Designated as Hedging Instrument | Futures contracts | Other assets | ||||
Derivative [Line Items] | ||||
Asset derivatives - fair value | [2] | 139 | 51 | |
Not Designated as Hedging Instrument | Futures contracts | Other liabilities | ||||
Derivative [Line Items] | ||||
Liability derivatives - fair value | [2] | (61) | (17) | |
Not Designated as Hedging Instrument | Foreign currency forward contracts | ||||
Derivative [Line Items] | ||||
Net derivatives - notional value | [1] | 1,224 | 1,136 | |
Net realized gains (losses) on derivative instruments | ||||
Net realized gains (losses) on derivative instruments | 21 | 6 | (40) | |
Not Designated as Hedging Instrument | Foreign currency forward contracts | Other assets | ||||
Derivative [Line Items] | ||||
Asset derivatives - fair value | [2] | 27 | 39 | |
Not Designated as Hedging Instrument | Foreign currency forward contracts | Other liabilities | ||||
Derivative [Line Items] | ||||
Liability derivatives - fair value | [2] | (32) | (35) | |
Not Designated as Hedging Instrument | Other | ||||
Derivative [Line Items] | ||||
Net derivatives - notional value | [1],[3] | 512 | 3,592 | |
Net realized gains (losses) on derivative instruments | ||||
Net realized gains (losses) on derivative instruments | (11) | 5 | $ 23 | |
Not Designated as Hedging Instrument | Other | Other assets | ||||
Derivative [Line Items] | ||||
Asset derivatives - fair value | [2],[3] | 31 | 59 | |
Not Designated as Hedging Instrument | Other | Other liabilities | ||||
Derivative [Line Items] | ||||
Liability derivatives - fair value | [2],[3] | $ (26) | $ (24) | |
[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.’[3]Includes swaps, options and other derivatives contracts |
Variable Interest Entity and _3
Variable Interest Entity and Noncontrolling Interests - Variable interest entity (Details) - USD ($) $ in Millions | 1 Months Ended | |
Mar. 31, 2014 | Jul. 01, 2021 | |
Greysbridge Holdings Ltd | ||
Variable Interest Entity [Line Items] | ||
Percentage ownership | 40% | |
Greysbridge Holdings Ltd | Kelso And Company | ||
Variable Interest Entity [Line Items] | ||
Percentage ownership | 30% | |
Greysbridge Holdings Ltd | Warburg Pincus LLC | ||
Variable Interest Entity [Line Items] | ||
Percentage ownership | 30% | |
Variable Interest Entity, Primary Beneficiary | Somers Holdings Ltd. | ||
Variable Interest Entity [Line Items] | ||
Initial investment contribution amount | $ 100 | |
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 - Cash flows of variable interest entity (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Variable Interest Entity [Line Items] | |||
Net Cash Provided by (Used in) Operating Activities | $ 5,749 | $ 3,816 | $ 3,425 |
Net cash used for investing activities | (5,468) | (3,101) | (2,138) |
Net Cash Provided by (Used in) Financing Activities | (69) | (706) | (1,229) |
Somers Holdings Ltd. | Variable Interest Entity, Primary Beneficiary | |||
Variable Interest Entity [Line Items] | |||
Net Cash Provided by (Used in) Operating Activities | 0 | 0 | 47 |
Net cash used for investing activities | 0 | 0 | 96 |
Net Cash Provided by (Used in) Financing Activities | $ 0 | $ 0 | $ (2) |
Variable Interest Entity and _5
Variable Interest Entity and Noncontrolling Interests - Activity in redeemeable noncontrolling interest (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Variable Interest Entity and Noncontrolling Interest Disclosure [Abstract] | |||
Balance, beginning of year | $ 11 | $ 9 | $ 58 |
Impact of deconsolidation of Somers | 0 | 0 | (49) |
Other | (9) | 2 | 0 |
Balance, end of year | $ 2 | $ 11 | $ 9 |
Variable Interest Entity and _6
Variable Interest Entity and Noncontrolling Interests - Income or loss attributable to third party investors (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Noncontrolling Interest [Line Items] | |||
Amounts attributable to non-redeemable noncontrolling interests | $ 0 | $ 0 | $ (78) |
Amounts attributable to redeemable noncontrolling interests | 1 | (6) | (4) |
Net (income) loss attributable to noncontrolling interests | $ 1 | $ (6) | $ (82) |
Variable Interest Entity and _7
Variable Interest Entity and Noncontrolling Interests - Other variable interest entity disclosures (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | $ 58,906 | $ 47,990 | $ 45,101 | ||
Variable Interest Entity, Not Primary Beneficiary | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 1,242 | 3,595 | |||
Remaining Coverage, Amount | 311 | ||||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2017-1 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | 37 | |||
Remaining Coverage, Amount | [1] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2018-1 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | [2] | 90 | ||
Remaining Coverage, Amount | [1],[2] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2018-3 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | 199 | |||
Remaining Coverage, Amount | [1] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2019-1 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 71 | 108 | |||
Remaining Coverage, Amount | [1] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2019-2 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | [2] | 325 | ||
Remaining Coverage, Amount | [1],[2] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2019-3 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 99 | 223 | |||
Remaining Coverage, Amount | [1] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2019-4 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | [2] | 266 | ||
Remaining Coverage, Amount | [1],[2] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2020-2 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | [2] | 105 | ||
Remaining Coverage, Amount | [1],[2] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2020-3 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | [2] | 244 | ||
Remaining Coverage, Amount | [1],[2] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2020-4 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | [2] | 98 | ||
Remaining Coverage, Amount | [1],[2] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2021-1 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | [2] | 467 | ||
Remaining Coverage, Amount | [1],[2] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2021-2 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 0 | [2] | 458 | ||
Remaining Coverage, Amount | [1],[2] | 0 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2021-3 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 429 | 490 | |||
Remaining Coverage, Amount | [1] | 112 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2022-1 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 256 | 284 | |||
Remaining Coverage, Amount | [1] | 26 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2022-2 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 201 | $ 201 | |||
Remaining Coverage, Amount | [1] | 126 | |||
Variable Interest Entity, Not Primary Beneficiary | Bellemeade 2023-1 Ltd | |||||
Variable Interest Entity [Line Items] | |||||
Total VIE Assets | 186 | ||||
Remaining Coverage, Amount | [1] | $ 47 | |||
[1]Coverage from a separate panel of reinsurers remaining at December 31, 2023[2]Agreements terminated in the 2023 fourth quarter |
Other Comprehensive Income - Co
Other Comprehensive Income - Components of accumulated other comprehensive income (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | $ (1,646) | $ (65) | $ 489 |
Other comprehensive income (loss) before reclassifications | 570 | (1,828) | (437) |
Amounts reclassified from accumulated other comprehensive income | 400 | 247 | (117) |
Net current period other comprehensive income (loss) | 970 | (1,581) | (554) |
Ending balance | (676) | (1,646) | (65) |
Unrealized Appreciation on Available-For-Sale Investments | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | (1,512) | 13 | 501 |
Other comprehensive income (loss) before reclassifications | 547 | (1,772) | (371) |
Amounts reclassified from accumulated other comprehensive income | 400 | 247 | (117) |
Net current period other comprehensive income (loss) | 947 | (1,525) | (488) |
Ending balance | (565) | (1,512) | 13 |
Foreign Currency Translation Adjustments | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | (134) | (78) | (12) |
Other comprehensive income (loss) before reclassifications | 23 | (56) | (66) |
Amounts reclassified from accumulated other comprehensive income | 0 | 0 | 0 |
Net current period other comprehensive income (loss) | 23 | (56) | (66) |
Ending balance | $ (111) | $ (134) | $ (78) |
Other Comprehensive Income - Am
Other Comprehensive Income - Amounts reclassified from accumulated other comprehensive income (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||
Provision for credit losses | $ 3 | $ (44) | $ (1) |
Income (loss) before income taxes | 3,570 | 1,562 | 2,368 |
Income tax (expense) benefit | 873 | (80) | (128) |
Net of tax | 4,443 | 1,476 | 2,157 |
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) | (431) | (235) | 157 |
Provision for credit losses | 3 | (44) | (2) |
Income (loss) before income taxes | (428) | (279) | 155 |
Income tax (expense) benefit | 28 | 32 | (38) |
Net of tax | $ (400) | $ (247) | $ 117 |
Other Comprehensive Income - Ta
Other Comprehensive Income - Tax effects on components of other comprehensive income (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Before tax amount: | |||
Unrealized holding gains (losses) arising during period, before tax | $ 617 | $ (2,009) | $ (408) |
Less reclassification of net realized gains (losses) included in net income, before tax | (428) | (279) | 155 |
Foreign currency translation adjustments, before tax | 23 | (56) | (65) |
Other comprehensive income (loss), before tax | 1,068 | (1,786) | (628) |
Tax expense (benefit): | |||
Unrealized holding gains (losses) arising during period, tax | 70 | (237) | (22) |
Less reclassification of net realized gains (losses) included in net income, tax | (28) | (32) | 38 |
Foreign currency translation adjustments, tax | 0 | 0 | 0 |
Other comprehensive income (loss), tax | 98 | (205) | (60) |
Net of tax amount: | |||
Unrealized holding gains (losses) arising during period, net of tax | 547 | (1,772) | (386) |
Less reclassification of net realized gains (losses) included in net income, net of tax | (400) | (247) | 117 |
Foreign currency translation adjustments, net of tax | 23 | (56) | (65) |
Net current period other comprehensive income (loss) | $ 970 | $ (1,581) | $ (568) |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Numerator: | ||||
Net income | $ 4,442 | $ 1,482 | $ 2,239 | |
Net (income) loss attributable to noncontrolling interests | 1 | (6) | (82) | |
Net income available to Arch | 4,443 | 1,476 | 2,157 | |
Preferred share dividends | (40) | (40) | (48) | |
Loss on redemption of preferred shares | 0 | 0 | (15) | |
Net income available to Arch common shareholders | $ 4,403 | $ 1,436 | $ 2,094 | |
Denominator: | ||||
Weighted average common shares outstanding | 368.7 | 368.6 | 391.7 | |
Effect of dilutive common share equivalents: | ||||
Nonvested restricted shares | 2.5 | 2.1 | 2 | |
Stock options | [1] | 7.6 | 6.9 | 6.6 |
Weighted average common shares and common share equivalents outstanding — diluted | 378.8 | 377.6 | 400.3 | |
Earnings per common share: | ||||
Basic (per share) | $ 11.94 | $ 3.90 | $ 5.35 | |
Diluted (per share) | $ 11.62 | $ 3.80 | $ 5.23 | |
Stock Options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per common share (shares) | 0.5 | 0.8 | 2.4 | |
[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 2023, 2022 and 2021, the number of stock options excluded were 0.5 million, 0.8 million and 2.4 million, respectively. |
Income Taxes - Components of in
Income Taxes - Components of income tax (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Current expense (benefit): | |||
United States | $ 251 | $ 195 | $ 284 |
Non-U.S. | 37 | 6 | 11 |
Current Income Tax Expense (Benefit) | 288 | 201 | 295 |
Deferred expense (benefit): | |||
United States | (20) | (96) | (123) |
Non-U.S. | (1,141) | (25) | (44) |
Deferred Income Tax Expense (Benefit) | (1,161) | (121) | (167) |
Income tax expense (benefit) | $ (873) | $ 80 | $ 128 |
Income Taxes - Income before ta
Income Taxes - Income before taxes by jurisdiction (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Line Items] | |||
Income (loss) before income taxes | $ 3,570 | $ 1,562 | $ 2,368 |
Bermuda | |||
Income Tax Disclosure [Line Items] | |||
Income (loss) before income taxes | 2,099 | 986 | 1,519 |
United States | |||
Income Tax Disclosure [Line Items] | |||
Income (loss) before income taxes | 1,239 | 401 | 643 |
Other | |||
Income Tax Disclosure [Line Items] | |||
Income (loss) before income taxes | $ 232 | $ 175 | $ 206 |
Income Taxes - Statutory tax ra
Income Taxes - Statutory tax rate by jurisdiction (Details) | 12 Months Ended |
Dec. 31, 2023 | |
Bermuda | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 0% |
United States | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 21% |
United Kingdom | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 25% |
Ireland | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 12.50% |
Denmark | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 22% |
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% |
Hong Kong | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 16.50% |
Netherlands | |
Income Tax Disclosure [Line Items] | |
Statutory tax rate (percentage) | 25.80% |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of effective tax rate (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Expected income tax expense (benefit) computed on pre-tax income at weighted average income tax rate | $ 300 | $ 110 | $ 158 |
Addition (reduction) in income tax expense (benefit) resulting from: | |||
Investment income | (14) | (13) | (24) |
State taxes, net of U.S. federal tax benefit | 6 | 11 | 21 |
Dividend withholding taxes | 9 | 11 | 12 |
Change in valuation allowance | 4 | (23) | (40) |
Base eroding tax | 9 | 8 | 0 |
Share based compensation | (13) | (9) | (5) |
Tax credits | (3) | (10) | 0 |
Change in tax rate | (1,179) | (5) | 0 |
Other | 8 | 0 | 6 |
Income tax expense (benefit) | $ (873) | $ 80 | $ 128 |
Income Taxes - Components of de
Income Taxes - Components of deferred tax assets and liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred income tax assets: | ||
Net operating loss | $ 93 | $ 77 |
Discounting of net loss reserves | 219 | 78 |
Net unearned premium reserve | 133 | 97 |
Compensation liabilities | 64 | 55 |
Foreign tax credit carryforward | 16 | 17 |
Goodwill and intangible assets | 1,020 | 0 |
Bad debt reserves | 16 | 17 |
Depreciation and amortization | 133 | 141 |
Lease liability | 31 | 27 |
Net unrealized decline of investments | 89 | 193 |
Lloyds year of account deferral | 0 | 1 |
Fair value adjustment to senior notes | 41 | 0 |
Other, net | 13 | 11 |
Deferred income tax assets before valuation allowance | 1,868 | 714 |
Valuation allowance | (15) | (7) |
Deferred income tax assets net of valuation allowance | 1,853 | 707 |
Deferred income tax liabilities: | ||
Goodwill and intangibles | 0 | (39) |
Lloyds year of account deferral | (13) | 0 |
Contingency reserve | (50) | (44) |
Deferred policy acquisition costs | (144) | (64) |
Investment related | (13) | (9) |
Right-of-use asset | (24) | (21) |
Total deferred income tax liabilities | (245) | (177) |
Net deferred income tax assets | $ 1,608 | $ 530 |
Income Taxes - Operating loss c
Income Taxes - Operating loss carryfowards and tax credits (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Operating Loss Carryforwards [Line Items] | ||
Foreign tax credit carryforward | $ 16 | $ 17 |
United Kingdom | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 198 | |
Foreign tax credit carryforward | 10 | |
Ireland | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 24 | |
Australia | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 47 | |
Hong Kong | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 32 | |
Gibraltar | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 24 | |
Cyprus | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 1 | |
United States | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 78 | |
Foreign tax credit carryforward | 6 | |
United States | Tax Years 2024 To 2027 | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforward, annual utilization limit | 2 | |
United States | Tax Years 2028 To 2038 | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforward, annual utilization limit | 1 | |
United States | Tax Years After 2038 | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforward, annual utilization limit | $ 0.3 |
Income Taxes - Unrecognized tax
Income Taxes - Unrecognized tax benefits (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Reconciliation of beginning and ending amount of unrecognized tax benefits | ||
Balance at beginning of year | $ 2 | $ 2 |
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 | $ 2 |
Income Taxes - Summary of open
Income Taxes - Summary of open tax years by major jurisdiction (Details) | 12 Months Ended |
Dec. 31, 2023 | |
Latest Tax Year | United States | |
Income Tax Contingency [Line Items] | |
Open tax year | 2023 |
Latest Tax Year | United Kingdom | |
Income Tax Contingency [Line Items] | |
Open tax year | 2023 |
Latest Tax Year | Ireland | |
Income Tax Contingency [Line Items] | |
Open tax year | 2023 |
Latest Tax Year | Canada | |
Income Tax Contingency [Line Items] | |
Open tax year | 2023 |
Latest Tax Year | Switzerland | |
Income Tax Contingency [Line Items] | |
Open tax year | 2023 |
Latest Tax Year | Denmark | |
Income Tax Contingency [Line Items] | |
Open tax year | 2023 |
Latest Tax Year | Australia | |
Income Tax Contingency [Line Items] | |
Open tax year | 2023 |
Earliest Tax Year | United States | |
Income Tax Contingency [Line Items] | |
Open tax year | 2019 |
Earliest Tax Year | United Kingdom | |
Income Tax Contingency [Line Items] | |
Open tax year | 2021 |
Earliest Tax Year | Ireland | |
Income Tax Contingency [Line Items] | |
Open tax year | 2018 |
Earliest Tax Year | Canada | |
Income Tax Contingency [Line Items] | |
Open tax year | 2019 |
Earliest Tax Year | Switzerland | |
Income Tax Contingency [Line Items] | |
Open tax year | 2019 |
Earliest Tax Year | Denmark | |
Income Tax Contingency [Line Items] | |
Open tax year | 2019 |
Earliest Tax Year | Australia | |
Income Tax Contingency [Line Items] | |
Open tax year | 2019 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Operating Loss Carryforwards [Line Items] | |||
Net deferred tax assets | $ 1,853 | $ 1,853 | $ 707 |
Bermuda | |||
Operating Loss Carryforwards [Line Items] | |||
Deferred tax asset, economic transition adjustment | 1,180 | ||
Utilization period of deferred tax assets | 10 years | ||
Other assets | T&L Bonds | |||
Operating Loss Carryforwards [Line Items] | |||
US mortgage guaranty tax and loss bonds | 42 | $ 42 | $ 12 |
Other liabilities | |||
Operating Loss Carryforwards [Line Items] | |||
Current income taxes payable | $ 20 | $ 20 |
Transactions with Related Par_2
Transactions with Related Parties (Details) | 12 Months Ended | |||||||
Dec. 31, 2023 USD ($) director | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2017 USD ($) | Jan. 01, 2024 | Jul. 01, 2021 | Jan. 01, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Related Party Transaction [Line Items] | ||||||||
Purchases of other investments | $ 2,171,000,000 | $ 1,720,000,000 | $ 1,859,000,000 | |||||
Net reserves | 16,062,000,000 | 13,752,000,000 | 12,158,000,000 | $ 12,199,000,000 | ||||
Reinsurance recoverable for paid and unpaid claims and claims adjustments | 7,064,000,000 | 6,564,000,000 | 5,881,000,000 | |||||
Ceded premiums written | 4,935,000,000 | 4,249,000,000 | 3,735,000,000 | |||||
Reinsurance balances payable | 2,000,000,000 | 1,530,000,000 | ||||||
Net premiums written | 13,468,000,000 | 11,078,000,000 | 9,017,000,000 | |||||
Net premiums earned | $ 12,440,000,000 | 9,679,000,000 | $ 8,082,000,000 | |||||
Forecast | ||||||||
Related Party Transaction [Line Items] | ||||||||
Put Call Right To Sell Purchase Shares | 33.30% | |||||||
Premia Holdings Ltd | ||||||||
Related Party Transaction [Line Items] | ||||||||
Number of directors | director | 7 | |||||||
Greysbridge Holdings Ltd | ||||||||
Related Party Transaction [Line Items] | ||||||||
Percentage ownership | 40% | |||||||
Kelso And Company | Greysbridge Holdings Ltd | ||||||||
Related Party Transaction [Line Items] | ||||||||
Percentage ownership | 30% | |||||||
Warburg Pincus LLC | Greysbridge Holdings Ltd | ||||||||
Related Party Transaction [Line Items] | ||||||||
Percentage ownership | 30% | |||||||
Equity Method Investee | Premia Holdings Ltd | ||||||||
Related Party Transaction [Line Items] | ||||||||
Percentage ownership | 25% | |||||||
Purchases of other investments | $ 100,000,000 | |||||||
Number of directors | director | 2 | |||||||
Net reserves | $ 380,000,000 | |||||||
Reinsurance recoverable for paid and unpaid claims and claims adjustments | $ 0 | 0 | ||||||
Funds held liability | 0 | 0 | ||||||
Net premiums written | 80,000,000 | 121,000,000 | ||||||
Net premiums earned | 81,000,000 | 120,000,000 | ||||||
Funds Held under Reinsurance Agreements, Asset | 158,000,000 | 119,000,000 | ||||||
Equity Method Investee | Somers Holdings Ltd. | ||||||||
Related Party Transaction [Line Items] | ||||||||
Reinsurance recoverable for paid and unpaid claims and claims adjustments | 1,300,000,000 | 1,200,000,000 | ||||||
Reinsurance balances payable | 475,000,000 | 414,000,000 | ||||||
Senior notes | $ 35,000,000 | |||||||
Preferred shares, dividend rate (as a percent) | 6.50% | |||||||
Net premiums written | $ 574,000,000 | $ 519,000,000 |
Leases - Additional information
Leases - Additional information regarding leases (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Lessee, Lease, Description [Line Items] | ||||
Operating lease costs | $ 33 | $ 34 | ||
Sublease Income | [1] | (2) | (1) | |
Cash payments included in the measurement of lease liabilities reported in operating cash flows | 31 | 26 | ||
Right-of-use assets obtained in exchange for new lease liabilities | 28 | 43 | ||
Right-of-use assets | [2] | 125 | 123 | |
Operating lease liability | [2] | $ 156 | $ 152 | |
Weighted average discount rate | 4.70% | 4.20% | ||
Weighted average remaining lease term | 7 years 2 months 12 days | 6 years 7 months 6 days | ||
Balance sheet location of right of use asset | Other assets | Other assets | ||
Balance sheet location of operating lease liability | Other liabilities | Other liabilities | ||
Rental expense | $ 38 | $ 39 | $ 37 | |
Maximum | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease term | 14 years | |||
[1]The sublease income primarily relates to office property in Raleigh, North Carolina.[2]The right-of-use assets are included in ‘ other assets other liabilities |
Leases - Contractual maturities
Leases - Contractual maturities (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | |
Contractual maturities of operating lease liabilities | |||
2024 | $ 32 | ||
2025 | 27 | ||
2026 | 26 | ||
2027 | 22 | ||
2028 | 19 | ||
2029 and thereafter | 60 | ||
Total undiscounted lease liability | 186 | ||
Less: present value adjustment | (30) | ||
Operating lease liability | [1] | $ 156 | $ 152 |
[1]The right-of-use assets are included in ‘ other assets other liabilities |
Commitments and Contingencies -
Commitments and Contingencies - Concentrations of credit risk (Details) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Customer concentration risk | Gross written premiums | |||
Concentration Risk [Line Items] | |||
Concentration risk, threshold | 10% | ||
Customer concentration risk | Gross written premiums | Marsh & McLennan Companies and its subsidiaries | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 19% | 17.30% | 18.30% |
Customer concentration risk | Gross written premiums | AON Corporation and its subsidiaries | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 13.90% | 13.80% | 12.20% |
Credit concentration risk | Shareholders' equity | |||
Concentration Risk [Line Items] | |||
Concentration risk, threshold | 10% |
Commitments and Contingencies_2
Commitments and Contingencies - Other commitments (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
Investment commitments | $ 3,600 | $ 2,900 |
Estimated purchase commitments, primarily related to software and computerized systems | $ 148 | $ 150 |
Debt and Financing Arrangemen_3
Debt and Financing Arrangements - Schedule of senior notes outstanding (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | |||
Carrying amount | $ 2,726 | $ 2,725 | |
Senior Notes | |||
Debt Instrument [Line Items] | |||
Principal amount | 2,750 | ||
Carrying amount | $ 2,726 | 2,725 | |
Senior Notes | 7.350% senior notes due 2034 | |||
Debt Instrument [Line Items] | |||
Stated interest rate (percentage) | [1] | 7.35% | |
Principal amount | [1] | $ 300 | |
Carrying amount | $ 298 | 298 | |
Senior Notes | 5.144% senior notes due 2043 | |||
Debt Instrument [Line Items] | |||
Stated interest rate (percentage) | [2] | 5.144% | |
Principal amount | [2] | $ 500 | |
Carrying amount | $ 495 | 495 | |
Senior Notes | 4.011% senior notes due 2026 | |||
Debt Instrument [Line Items] | |||
Stated interest rate (percentage) | [3] | 4.011% | |
Principal amount | [3] | $ 500 | |
Carrying amount | $ 498 | 498 | |
Senior Notes | 5.031% senior notes due 2046 | |||
Debt Instrument [Line Items] | |||
Stated interest rate (percentage) | [4] | 5.031% | |
Principal amount | [4] | $ 450 | |
Carrying amount | $ 446 | 445 | |
Senior Notes | 3.635% senior notes due 2050 | |||
Debt Instrument [Line Items] | |||
Stated interest rate (percentage) | [5] | 3.635% | |
Principal amount | [5] | $ 1,000 | |
Carrying amount | $ 989 | $ 989 | |
[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”). |
Debt and Financing Arrangemen_4
Debt and Financing Arrangements - Letter of Credit and Revolving Credit Facilities (Details) - USD ($) | Dec. 31, 2023 | Oct. 25, 2023 | Sep. 27, 2023 | Dec. 31, 2022 |
Line of Credit Facility [Line Items] | ||||
Advances from Federal Home Loan Banks | $ 0 | $ 0 | ||
Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Optional increased capacity | 1,500,000,000 | |||
Credit Facility | Asset Pledged as Collateral | Letter of Credit | ||||
Line of Credit Facility [Line Items] | ||||
Investments securing LOCs | 550,000,000 | |||
Secured letter of credit facility | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | 425,000,000 | |||
Outstanding borrowings | 273,000,000 | |||
Remaining capacity | 152,000,000 | |||
Unsecured revolving loan and letter of credit facility | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | 500,000,000 | |||
Outstanding borrowings | 0 | $ 0 | ||
Remaining capacity | 500,000,000 | |||
Other Arch Capital Subsidiaries | Secured letter of credit facility | ||||
Line of Credit Facility [Line Items] | ||||
Outstanding borrowings | 38,000,000 | |||
Arch Re Bermuda | Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 175,000,000 | |||
Outstanding borrowings | 114,000,000 | |||
Remaining capacity | 61,000,000 | |||
Letters of credit outstanding, amount | $ 530,000,000 | |||
Arch Re Bermuda | Lloyds Facility | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 530,000,000 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Analysis of goodwill and intangible assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill | |||
Goodwill, beginning of year | $ 342 | $ 345 | |
Goodwill, acquisitions | 0 | 8 | |
Goodwill, impairment | (2) | ||
Goodwill, foreign currency translation adjustment | 5 | (11) | |
Goodwill, end of year | 345 | 342 | $ 345 |
Intangible assets (indefinite life) | |||
Intangible assets with an indefinite life, beginning of year | 69 | 71 | |
Intangible assets with an indefinite life, acquisitions | 0 | 0 | |
Impairment of Intangible Assets, Indefinite-Lived (Excluding Goodwill) | 0 | ||
Intangible assets with an indefinite life, foreign currency translation adjustment | 1 | (2) | |
Intangible assets with an indefinite life, end of year | 70 | 69 | 71 |
Intangible assets (finite life) | |||
Intangible assets with a finite life, beginning of year | 393 | 529 | |
Intangible assets with a finite life, acquisitions | 11 | 0 | |
Intangible assets with a finite life, amortization | (95) | (106) | (82) |
Intangible assets with a finite life, impairment | 0 | ||
Intangible assets with a finite life, foreign currency translation adjustment | 7 | (30) | |
Intangible assets with a finite life, end of year | 316 | 393 | 529 |
Total | |||
Goodwill and intangible assets, beginning of year | 804 | 945 | |
Goodwill and intangible assets, acquisitions | 11 | 8 | |
Goodwill and intangible assets impairment | (2) | ||
Goodwill and intangible assets, foreign currency movements and other adjustments | 13 | (43) | |
Goodwill and intangible assets, end of year | 731 | 804 | 945 |
Goodwill and intangible assets, gross balance | 1,523 | ||
Intangible assets with a finite life, accumulated amortization | (766) | (677) | |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | (26) | (42) | |
Goodwill and intangible assets | 731 | 804 | $ 945 |
Goodwill | |||
Goodwill | |||
Goodwill, end of year | 345 | ||
Total | |||
Goodwill and intangible assets, beginning of year | 342 | ||
Goodwill and intangible assets, end of year | 345 | 342 | |
Goodwill, gross balance | 348 | ||
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | (3) | (9) | |
Goodwill and intangible assets | 345 | $ 342 | |
Intangible assets with an indefinite life | |||
Intangible assets (indefinite life) | |||
Intangible assets with an indefinite life, end of year | 70 | ||
Total | |||
Indefinite-lived intangible assets, gross balance | 70 | ||
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 0 | ||
Intangible assets with a finite life | |||
Intangible assets (finite life) | |||
Intangible assets with a finite life, end of year | 316 | ||
Total | |||
Intangible assets with a finite life, gross balance | 1,105 | ||
Intangible assets with a finite life, accumulated amortization | (766) | ||
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | $ (23) |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Summary of intangible assets by major class (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Schedule of Goodwill And Intangible Assets [Line Items] | |||
Gross balance | $ 1,523 | $ 1,523 | |
Intangible assets with a finite life, accumulated amortization | (766) | (677) | |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | (26) | (42) | |
Goodwill and intangible assets | 731 | 804 | $ 945 |
Intangible liability - unfavorable service contract | |||
Schedule of Goodwill And Intangible Assets [Line Items] | |||
Gross balance | (10) | (10) | |
Intangible assets with a finite life, accumulated amortization | 10 | 10 | |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 0 | 0 | |
Goodwill and intangible assets | 0 | 0 | |
Intangible assets with a finite life | |||
Schedule of Goodwill And Intangible Assets [Line Items] | |||
Intangible assets with a finite life, accumulated amortization | (766) | ||
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | (23) | ||
Intangible assets with a finite life | Acquired insurance contracts | |||
Schedule of Goodwill And Intangible Assets [Line Items] | |||
Gross balance | 452 | 452 | |
Intangible assets with a finite life, accumulated amortization | (441) | (426) | |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 0 | (1) | |
Goodwill and intangible assets | 11 | 25 | |
Intangible assets with a finite life | Operating platform | |||
Schedule of Goodwill And Intangible Assets [Line Items] | |||
Gross balance | 64 | 53 | |
Intangible assets with a finite life, accumulated amortization | (54) | (50) | |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 0 | 0 | |
Goodwill and intangible assets | 10 | 3 | |
Intangible assets with a finite life | Distribution relationships | |||
Schedule of Goodwill And Intangible Assets [Line Items] | |||
Gross balance | 594 | 602 | |
Intangible assets with a finite life, accumulated amortization | (277) | (208) | |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | (23) | (31) | |
Goodwill and intangible assets | 294 | 363 | |
Intangible assets with a finite life | Other | |||
Schedule of Goodwill And Intangible Assets [Line Items] | |||
Gross balance | 5 | 5 | |
Intangible assets with a finite life, accumulated amortization | (4) | (3) | |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 0 | 0 | |
Goodwill and intangible assets | 1 | 2 | |
Goodwill | |||
Schedule of Goodwill And Intangible Assets [Line Items] | |||
Gross balance | 348 | 351 | |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | (3) | (9) | |
Goodwill and intangible assets | 345 | 342 | |
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 | 0 | ||
Intangible assets with an indefinite life | Insurance licenses | |||
Schedule of Goodwill And Intangible Assets [Line Items] | |||
Gross balance | 48 | 48 | |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 0 | 0 | |
Goodwill and intangible assets | 48 | 48 | |
Intangible assets with an indefinite life | Syndicate capacity | |||
Schedule of Goodwill And Intangible Assets [Line Items] | |||
Gross balance | 22 | 22 | |
Goodwill and intangible assets, accumulated foreign currency translation and other adjustments | 0 | (1) | |
Goodwill and intangible assets | $ 22 | $ 21 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Future amortization expense (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
2024 | $ 77 | ||
2025 | 46 | ||
2026 | 34 | ||
2027 | 31 | ||
2028 | 29 | ||
2029 and thereafter | 99 | ||
Finite-Lived Intangible Assets, Net | $ 316 | $ 393 | $ 529 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Narrative (Details) | Dec. 31, 2023 |
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 | 13 years |
Shareholders' Equity - Roll-for
Shareholders' Equity - Roll-forward of changes in issued and outstanding common shares (Details) - $ / shares shares in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Common Shares: | ||||
Shares issued, beginning of year | 588.3 | 583.3 | 579 | |
Shares issued | [1] | 2.8 | 3.5 | 2.7 |
Restricted shares issued, net of cancellations | 0.8 | 1.5 | 1.6 | |
Shares issued, end of year | 591.9 | 588.3 | 583.3 | |
Common shares held in treasury, end of year | (218.5) | (217.9) | (204.4) | |
Common shares outstanding, end of year | 373.4 | 370.4 | 378.9 | |
Authorized and Issued: | ||||
Common shares authorized | 1,800 | |||
Common shares, par value per share | $ 0.0011 | $ 0.0011 | ||
Preferred shares authorized | 50 | |||
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, shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Class of Stock [Line Items] | |||
Aggregate cost of shares repurchased | $ 0 | $ 586 | $ 1,234 |
Number of shares repurchased (shares) | 0 | 12.9 | 31.5 |
Average price per share repurchased | $ 0 | $ 45.44 | $ 39.20 |
Common shares held in treasury (shares) | 218.5 | 217.9 | 204.4 |
Common shares held in treasury, at cost | $ 4,424 | $ 4,378 | |
Common shares | |||
Class of Stock [Line Items] | |||
Remaining share repurchase authorization | $ 1,000 | ||
Cumulative number of shares acquired since inception of share repurchase program | 433.6 | ||
Aggregate purchase price of shares acquired since inception of share repurchase program | $ 5,900 |
Shareholders' Equity - Preferre
Shareholders' Equity - Preferred shares (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 1 Months Ended | 4 Months Ended | ||||||
Jan. 01, 2018 | Sep. 30, 2021 | Jun. 30, 2021 | Nov. 30, 2017 | Aug. 31, 2017 | Nov. 30, 2017 | Dec. 31, 2023 | Sep. 30, 2022 | |
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 shares in Millions | 12 Months Ended | ||
May 04, 2023 | Dec. 31, 2023 | May 04, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
2022 Long Term Incentive and Share Award Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares reserved for issuance | 9 | ||
Number of shares authorized for incentive stock options | 6 | ||
Shares available for issuance | 7.8 | ||
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 | 34.5 | ||
Shares available for issuance | 5.8 | ||
2007 Employee Share Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares reserved for issuance | 12.8 | ||
Number of additional shares authorized | 3 | ||
Shares available for issuance | 3.6 |
Share-Based Compensation - Valu
Share-Based Compensation - Valuation assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-Based Payment Arrangement [Abstract] | |||
Dividend yield | 0% | 0% | 0% |
Expected volatility | 25.10% | 24% | 24.20% |
Risk free interest rate | 4.10% | 2% | 1% |
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 Millions | 12 Months Ended |
Dec. 31, 2023 USD ($) $ / shares shares | |
Number of Options / SARs | |
Outstanding, beginning of year (in shares) | shares | 14,420,901 |
Granted (in shares) | shares | 479,760 |
Exercised (in shares) | shares | (2,355,729) |
Forfeited or expired (in shares) | shares | (8,339) |
Outstanding, end of year (in shares) | shares | 12,536,593 |
Exercisable, end of year (in shares) | shares | 11,205,102 |
Weighted Average Exercise Price | |
Outstanding, beginning of year, weighted average exercise price | $ / shares | $ 28.17 |
Granted, weighted average exercise price | $ / shares | 69.24 |
Exercised, weighted average exercise price | $ / shares | 20.66 |
Forfeited or expired, weighted average exercise price | $ / shares | 48.38 |
Outstanding, end of year, weighted average exercise price | $ / shares | 31.14 |
Exercisable, end of year, weighted average exercise price | $ / shares | $ 28.68 |
Weighted average contractual term, outstanding, end of year | 4 years 1 month 6 days |
Weighted average contractual term, exercisable, end of year | 3 years 7 months 9 days |
Aggregate intrinsic value, outstanding, end of year | $ | $ 541 |
Aggregate intrinsic value, exercisable, end of year | $ | $ 511 |
Share-Based Compensation - Opti
Share-Based Compensation - Options additional information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
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 | $ 20 | ||
Tax benefit from exercise of stock options and SARs | $ 9 | ||
Weighted average grant date fair value | $ 23.50 | $ 13.26 | $ 9.22 |
Aggregate intrinsic value of options exercised | $ 116 | $ 113 | $ 47 |
Share-Based Compensation - Rest
Share-Based Compensation - Restricted common shares and restricted stock units activity (Details) | 12 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Number of Restricted Common Shares | |
Unvested Shares: | |
Unvested balance, beginning of year (in shares) | shares | 2,165,554 |
Number of restricted shares and restricted unit awards granted | shares | 678,657 |
Vested (in shares) | shares | (1,281,449) |
Forfeited (in shares) | shares | (38,157) |
Unvested balance, end of year (in shares) | shares | 1,524,605 |
Weighted Average Grant Date Fair Value: | |
Unvested balance, beginning of year, weighted average grant date fair value | $ / shares | $ 40.23 |
Weighted average grant date fair value | $ / shares | 69.47 |
Vested, weighted average grant date fair value | $ / shares | 38.37 |
Forfeited, weighted average grant date fair value | $ / shares | 49.65 |
Unvested balance, end of year, weighted average grant date fair value | $ / shares | $ 54.57 |
Number of Restricted Unit Awards | |
Unvested Shares: | |
Unvested balance, beginning of year (in shares) | shares | 517,293 |
Number of restricted shares and restricted unit awards granted | shares | 146,534 |
Vested (in shares) | shares | (352,190) |
Forfeited (in shares) | shares | (5,709) |
Unvested balance, end of year (in shares) | shares | 305,928 |
Weighted Average Grant Date Fair Value: | |
Unvested balance, beginning of year, weighted average grant date fair value | $ / shares | $ 37.17 |
Weighted average grant date fair value | $ / shares | 69.20 |
Vested, weighted average grant date fair value | $ / shares | 34.16 |
Forfeited, weighted average grant date fair value | $ / shares | 55.55 |
Unvested balance, end of year, weighted average grant date fair value | $ / shares | $ 55.63 |
Share-Based Compensation - Re_2
Share-Based Compensation - Restricted stock additional information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
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 | ||
Number of restricted shares and restricted unit awards granted | 825,191 | 1,089,393 | 1,261,773 |
Weighted average grant date fair value | $ 69.42 | $ 47.45 | $ 36.12 |
Aggregate fair value of vested restricted share and unit awards (in millions) | $ 122 | $ 51 | $ 41 |
Aggregate intrinsic value of restricted units outstanding | 23 | ||
Aggregate intrinsic value of restricted units vested | $ 0.4 |
Share-Based Compensation - Perf
Share-Based Compensation - Performance shares and performance units activity (Details) | 12 Months Ended | |
Dec. 31, 2023 $ / shares shares | ||
Performance Shares | ||
Unvested Shares: | ||
Unvested balance, beginning of year (in shares) | shares | 1,882,916 | |
Performance shares and units granted | shares | 550,394 | |
Performance shares, performance adjustment | shares | (341,420) | [1],[2] |
Vested (in shares) | shares | (207,486) | |
Forfeited (in shares) | shares | (3,708) | |
Unvested balance, end of year (in shares) | shares | 1,880,696 | |
Weighted Average Grant Date Fair Value: | ||
Unvested balance, beginning of year, weighted average grant date fair value | $ / shares | $ 43.75 | |
Weighted average grant date fair value | $ / shares | 74.08 | |
Performance shares, performance adjustment, weighted average grant date fair value | $ / shares | 44.17 | [1],[2] |
Vested, weighted average grant date fair value | $ / shares | 44.17 | |
Forfeited, weighted average grant date fair value | $ / shares | 59.83 | |
Unvested balance, end of year, weighted average grant date fair value | $ / shares | $ 52.47 | |
Performance Units | ||
Unvested Shares: | ||
Unvested balance, beginning of year (in shares) | shares | 39,710 | |
Performance shares and units granted | shares | 18,182 | |
Performance shares, performance adjustment | shares | (2,024) | [1],[2] |
Vested (in shares) | shares | (6,274) | |
Forfeited (in shares) | shares | 0 | |
Unvested balance, end of year (in shares) | shares | 49,594 | |
Weighted Average Grant Date Fair Value: | ||
Unvested balance, beginning of year, weighted average grant date fair value | $ / shares | $ 45.33 | |
Weighted average grant date fair value | $ / shares | 74.31 | |
Performance shares, performance adjustment, weighted average grant date fair value | $ / shares | 44.17 | [1],[2] |
Vested, weighted average grant date fair value | $ / shares | 44.17 | |
Forfeited, weighted average grant date fair value | $ / shares | 0 | |
Unvested balance, end of year, weighted average grant date fair value | $ / shares | $ 56.15 | |
[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) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Expected volatility | 25.10% | 24% | 24.20% |
Risk free interest rate | 4.10% | 2% | 1% |
Performance Common Shares and Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Expected volatility | 30.40% | 38.10% | 37.50% |
Risk free interest rate | 4.60% | 1.70% | 0.30% |
Performance shares and units granted | 568,576 | 690,772 | 685,104 |
Weighted average grant date fair value | $ 74.09 | $ 49.91 | $ 37.38 |
Aggregate fair value of vested restricted share and unit awards (in millions) | $ 14 | $ 27 | $ 24 |
Aggregate intrinsic value of performance shares outstanding | $ 4 | ||
Performance Common Shares and Units | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Payout percentage | 0% | ||
Performance Common Shares and Units | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Payout percentage | 200% |
Share-Based Compensation - Shar
Share-Based Compensation - Share-based compensation expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation expense | $ 92 | $ 88 | $ 87 |
Share based compensation expense, net of tax | 80 | 77 | 76 |
Options and SARs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation expense | 11 | 12 | 12 |
Share based compensation expense, net of tax | 10 | 11 | 11 |
Restricted Common Shares And Restricted Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation expense | 54 | 50 | 47 |
Share based compensation expense, net of tax | 45 | 42 | 39 |
Performance Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation expense | 23 | 22 | 24 |
Share based compensation expense, net of tax | 21 | 20 | 22 |
Employee Share Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation expense | 4 | 4 | 4 |
Share based compensation expense, net of tax | $ 4 | $ 4 | $ 4 |
Share-Based Compensation - Unre
Share-Based Compensation - Unrecognized compensation cost and period for recognition (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation cost related to unvested awards | $ 7 |
Weighted average recognition period (years) | 8 months 1 day |
Restricted Common Shares And Restricted Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation cost related to unvested awards | $ 43 |
Weighted average recognition period (years) | 11 months 12 days |
Performance Common Shares and Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation cost related to unvested awards | $ 11 |
Weighted average recognition period (years) | 5 months 8 days |
Retirement Plans (Details)
Retirement Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |||
Defined contribution plan, expense | $ 77 | $ 67 | $ 60 |
Statutory Information - Summary
Statutory Information - Summary of statutory capital, surplus and net income (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Bermuda | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | [1] | $ 24,120 | $ 19,546 | |
Required statutory capital and surplus | [1] | 7,112 | 6,450 | |
Statutory net income (loss) | 3,519 | 1,730 | $ 2,371 | |
Ireland | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | [1] | 1,148 | 968 | |
Required statutory capital and surplus | [1] | 942 | 815 | |
Statutory net income (loss) | 53 | (53) | 25 | |
United States | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | [1] | 6,897 | 6,195 | |
Required statutory capital and surplus | [1] | 1,895 | 1,749 | |
Statutory net income (loss) | 592 | 220 | 346 | |
United Kingdom | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | [1] | 1,367 | 1,018 | |
Required statutory capital and surplus | [1] | 1,192 | 543 | |
Statutory net income (loss) | 72 | 57 | 35 | |
Canada | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | [1] | 83 | 69 | |
Required statutory capital and surplus | [1] | 53 | 48 | |
Statutory net income (loss) | 6 | 9 | 7 | |
Australia | ||||
Statutory Accounting Practices [Line Items] | ||||
Actual statutory capital and surplus | [1] | 366 | 285 | |
Required statutory capital and surplus | [1] | 179 | 176 | |
Statutory net income (loss) | $ 68 | $ 39 | $ 12 | |
[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, 2023 USD ($) subsidiary | |
Ireland | |
Statutory Accounting Practices [Line Items] | |
Number Of Subsidiaries | subsidiary | 3 |
Mortgage | North Carolina or Wisconsin | |
Statutory Accounting Practices [Line Items] | |
Required contingency loss reserve as a percentage of net earned premiums | 50% |
Withdrawal restriction period | 10 years |
Withdrawal restriction period, with prior approval | 35% |
Maximum risk to capital ratio | 2,500% |
United Guaranty Residential Insurance Company | North Carolina | |
Statutory Accounting Practices [Line Items] | |
Dividends available for payment in 2022, total | $ 180 |
Arch Re US | United States | |
Statutory Accounting Practices [Line Items] | |
Dividends available for payment in 2022, total | $ 329 |
Arch Re Bermuda | Bermuda | |
Statutory Accounting Practices [Line Items] | |
Dividends, percentage permitted | 25% |
Dividend required notice period | 7 days |
Dividends available for payment in 2022 without prior regulatory approval | $ 4,800 |
Arch Group Reinsurance Ltd | Bermuda | |
Statutory Accounting Practices [Line Items] | |
Dividends, percentage permitted | 25% |
Dividend required notice period | 7 days |
Arch Mortgage Insurance Company | WISCONSIN | |
Statutory Accounting Practices [Line Items] | |
Dividends available for payment in 2022, total | $ 180 |
Arch Mortgage Guaranty Company | WISCONSIN | |
Statutory Accounting Practices [Line Items] | |
Dividends available for payment in 2022, total | $ 180 |
Schedule II - Condensed Finan_2
Schedule II - Condensed Financial Information of Registrant - Balance Sheet (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Assets | ||||
Total investments | $ 33,856 | $ 27,293 | ||
Cash | 917 | 855 | $ 859 | |
Investment in operating affiliates | 1,119 | 965 | ||
Other assets | 4,761 | 2,919 | ||
Total assets | 58,906 | 47,990 | 45,101 | |
Liabilities | ||||
Senior notes | 2,726 | 2,725 | ||
Other liabilities | 1,942 | 1,367 | ||
Total liabilities | 40,551 | 35,069 | 31,546 | |
Shareholders’ Equity | ||||
Non-cumulative preferred shares | 830 | 830 | ||
Common shares ($0.0011 par, shares issued: 591.9 and 588.3) | 1 | 1 | ||
Additional paid-in capital | 2,327 | 2,211 | ||
Retained earnings | 20,295 | 15,892 | ||
Accumulated other comprehensive income (loss), net of deferred income tax | (676) | (1,646) | (65) | $ 489 |
Common shares held in treasury, at cost (shares: 218.5 and 217.9) | (4,424) | (4,378) | ||
Total shareholders' equity | 18,353 | 12,910 | $ 13,546 | |
Total liabilities and shareholders' equity | $ 58,906 | $ 47,990 | ||
Parenthetical information: | ||||
Common shares, par value per share | $ 0.0011 | $ 0.0011 | ||
Common shares issued (shares) | 591.9 | 588.3 | 583.3 | 579 |
Common shares held in treasury (shares) | 218.5 | 217.9 | 204.4 | |
Parent Company | ||||
Assets | ||||
Total investments | $ 17 | $ 7 | ||
Cash | 9 | 11 | ||
Investment in subsidiaries | 19,590 | 14,191 | ||
Investment in operating affiliates | 4 | 5 | ||
Due from Affiliates | 0 | 2 | ||
Other assets | 58 | 18 | ||
Total assets | 19,678 | 14,234 | ||
Liabilities | ||||
Senior notes | 1,287 | 1,287 | ||
Other liabilities | 38 | 37 | ||
Total liabilities | 1,325 | 1,324 | ||
Shareholders’ Equity | ||||
Non-cumulative preferred shares | 830 | 830 | ||
Common shares ($0.0011 par, shares issued: 591.9 and 588.3) | 1 | 1 | ||
Additional paid-in capital | 2,327 | 2,211 | ||
Retained earnings | 20,295 | 15,892 | ||
Accumulated other comprehensive income (loss), net of deferred income tax | (676) | (1,646) | ||
Common shares held in treasury, at cost (shares: 218.5 and 217.9) | (4,424) | (4,378) | ||
Total shareholders' equity | 18,353 | 12,910 | ||
Total liabilities and shareholders' equity | $ 19,678 | $ 14,234 | ||
Parenthetical information: | ||||
Common shares, par value per share | $ 0.0011 | $ 0.0011 | ||
Common shares issued (shares) | 591.9 | 588.3 | ||
Common shares held in treasury (shares) | 218.5 | 217.9 |
Schedule II - Condensed Finan_3
Schedule II - Condensed Financial Information of Registrant - Statement of Income (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenues | |||
Net investment income | $ 1,023 | $ 496 | $ 389 |
Total revenues | 13,634 | 9,613 | 9,248 |
Expenses | |||
Corporate expenses | 102 | 95 | 78 |
Interest expense | 133 | 131 | 139 |
Total expenses | 10,249 | 8,126 | 7,145 |
Income tax (expense) benefit | 873 | (80) | (128) |
Income (loss) from operating affiliates | 184 | 75 | 264 |
Net income available to Arch | 4,443 | 1,476 | 2,157 |
Preferred share dividends | (40) | (40) | (48) |
Loss on redemption of preferred shares | 0 | 0 | (15) |
Net income available to Arch common shareholders | 4,403 | 1,436 | 2,094 |
Parent | |||
Revenues | |||
Net investment income | 2 | 2 | 2 |
Total revenues | 2 | 2 | 2 |
Expenses | |||
Corporate expenses | 93 | 86 | 72 |
Interest expense | 59 | 59 | 59 |
Total expenses | 152 | 145 | 131 |
Income (loss) before income taxes | (150) | (143) | (129) |
Income tax (expense) benefit | 41 | 0 | 0 |
Income (loss) from operating affiliates | (1) | (1) | (1) |
Income (loss) before equity in net income of subsidiaries | (110) | (144) | (130) |
Equity in net income of subsidiaries | 4,553 | 1,593 | 2,287 |
Net income available to Arch | 4,443 | 1,449 | 2,157 |
Preferred share dividends | (40) | (40) | (48) |
Loss on redemption of preferred shares | 0 | 0 | (15) |
Net income available to Arch common shareholders | $ 4,403 | $ 1,409 | $ 2,094 |
Schedule II - Condensed Finan_4
Schedule II - Condensed Financial Information of Registrant - Statement of Cash Flows (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Activities: | |||
Net Cash Provided by (Used in) Operating Activities | $ 5,749 | $ 3,816 | $ 3,425 |
Investing Activities: | |||
Net (purchases) sales of short-term investments | (696) | 467 | 165 |
Purchases of fixed assets | (52) | (50) | (41) |
Other | (23) | 125 | (524) |
Net cash used for investing activities | (5,468) | (3,101) | (2,138) |
Financing Activities: | |||
Purchases of common shares under share repurchase program | 0 | (586) | (1,234) |
Proceeds from common shares issued, net | (2) | 6 | 6 |
Proceeds from issuance of preferred shares, net | 0 | 0 | 486 |
Redemption of preferred shares | 0 | 0 | (450) |
Preferred dividends paid | (40) | (40) | (47) |
Net Cash Provided by (Used in) Financing Activities | (69) | (706) | (1,229) |
Increase (decrease) in cash and restricted cash | 225 | (41) | 24 |
Cash and restricted cash, beginning of year | 1,273 | 1,314 | 1,290 |
Cash and restricted cash, end of year | 1,498 | 1,273 | 1,314 |
Parent | |||
Operating Activities: | |||
Net Cash Provided by (Used in) Operating Activities | 46 | 621 | 1,728 |
Investing Activities: | |||
Net (purchases) sales of short-term investments | (8) | (5) | (2) |
Capital contributed to subsidiaries | 0 | 0 | (487) |
Purchases of fixed assets | 0 | 0 | (1) |
Other | 1 | (1) | 0 |
Net cash used for investing activities | (7) | (6) | (490) |
Financing Activities: | |||
Purchases of common shares under share repurchase program | 0 | (586) | (1,234) |
Proceeds from common shares issued, net | (2) | 6 | 6 |
Proceeds from issuance of preferred shares, net | 0 | 0 | 486 |
Redemption of preferred shares | 0 | 0 | (450) |
Preferred dividends paid | (40) | (40) | (48) |
Net Cash Provided by (Used in) Financing Activities | (42) | (620) | (1,240) |
Increase (decrease) in cash and restricted cash | (3) | (5) | (2) |
Cash and restricted cash, beginning of year | 12 | 17 | 19 |
Cash and restricted cash, end of year | $ 9 | $ 12 | $ 17 |
Schedule III - Supplementary _2
Schedule III - Supplementary Insurance Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||||
Deferred Acquisition Costs | $ 1,531 | $ 1,263 | $ 901 | ||
Reserves for Losses and Loss Adjustment Expenses | 22,752 | 20,032 | 17,758 | ||
Unearned Premiums | 8,808 | 7,337 | 6,012 | ||
Net Premiums Earned | 12,440 | 9,679 | 8,082 | ||
Net Losses and Loss Adjustment Expenses Incurred | 6,246 | 5,028 | 4,585 | ||
Amortization of Deferred Acquisition Costs | 2,312 | 1,740 | 1,303 | ||
Other Operating Expenses | [1] | 1,301 | 1,128 | 999 | |
Net Premiums Written | 13,468 | 11,078 | 9,017 | ||
Operating segments | Insurance | |||||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||||
Deferred Acquisition Costs | 566 | 301 | 378 | ||
Reserves for Losses and Loss Adjustment Expenses | 12,250 | 11,017 | 9,811 | ||
Unearned Premiums | 3,917 | 3,382 | 2,938 | ||
Net Premiums Earned | 5,446 | 4,560 | 3,625 | ||
Net Losses and Loss Adjustment Expenses Incurred | 3,122 | 2,784 | 2,345 | ||
Amortization of Deferred Acquisition Costs | 1,055 | 887 | 606 | ||
Other Operating Expenses | [1] | 819 | 665 | 559 | |
Net Premiums Written | 5,862 | 5,021 | 4,149 | ||
Operating segments | Reinsurance | |||||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||||
Deferred Acquisition Costs | 901 | 992 | 424 | ||
Reserves for Losses and Loss Adjustment Expenses | 9,924 | 8,306 | 6,879 | ||
Unearned Premiums | 4,254 | 3,206 | 2,263 | ||
Net Premiums Earned | 5,836 | 3,959 | 2,841 | ||
Net Losses and Loss Adjustment Expenses Incurred | 3,227 | 2,568 | 1,925 | ||
Amortization of Deferred Acquisition Costs | 1,240 | 813 | 537 | ||
Other Operating Expenses | [1] | 288 | 268 | 214 | |
Net Premiums Written | 6,554 | 4,924 | 3,254 | ||
Operating segments | Mortgage | |||||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||||
Deferred Acquisition Costs | 64 | (30) | 99 | ||
Reserves for Losses and Loss Adjustment Expenses | 578 | 709 | 1,068 | ||
Unearned Premiums | 637 | 749 | 811 | ||
Net Premiums Earned | 1,158 | 1,160 | 1,283 | ||
Net Losses and Loss Adjustment Expenses Incurred | (103) | (324) | 57 | ||
Amortization of Deferred Acquisition Costs | 17 | 40 | 97 | ||
Other Operating Expenses | [1] | 194 | 195 | 193 | |
Net Premiums Written | 1,052 | 1,133 | 1,261 | ||
Operating segments | Other | |||||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||||
Deferred Acquisition Costs | |||||
Reserves for Losses and Loss Adjustment Expenses | |||||
Unearned Premiums | |||||
Net Premiums Earned | 333 | ||||
Net Losses and Loss Adjustment Expenses Incurred | 258 | ||||
Amortization of Deferred Acquisition Costs | 63 | ||||
Other Operating Expenses | 33 | [1] | |||
Net Premiums Written | $ 353 | ||||
[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 Millions | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||||
Gross Amount | $ 9,652 | $ 8,542 | $ 7,707 | ||
Ceded to other Companies | (4,935) | (4,249) | (3,735) | ||
Assumed From Other Companies | 8,751 | 6,785 | 5,045 | ||
Net Amount | $ 13,468 | $ 11,078 | $ 9,017 | ||
Percentage of Amount Assumed to Net | 65% | 61.20% | 55.90% | ||
Operating segments | Insurance | |||||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||||
Gross Amount | $ 7,865 | $ 6,889 | $ 5,834 | ||
Ceded to other Companies | [1],[2] | (2,049) | (1,910) | (1,719) | |
Assumed From Other Companies | [1] | 46 | 42 | 34 | |
Net Amount | $ 5,862 | $ 5,021 | $ 4,149 | ||
Percentage of Amount Assumed to Net | 0.80% | 0.80% | 0.80% | ||
Operating segments | Reinsurance | |||||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||||
Gross Amount | $ 626 | $ 397 | $ 409 | ||
Ceded to other Companies | [1],[2] | (2,559) | (2,024) | (1,840) | |
Assumed From Other Companies | [1] | 8,487 | 6,553 | 4,685 | |
Net Amount | $ 6,554 | $ 4,924 | $ 3,254 | ||
Percentage of Amount Assumed to Net | 129.50% | 133.10% | 144% | ||
Operating segments | Mortgage | |||||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||||
Gross Amount | $ 1,161 | $ 1,256 | $ 1,213 | ||
Ceded to other Companies | [1],[2] | (335) | (322) | (247) | |
Assumed From Other Companies | [1] | 226 | 199 | 294 | |
Net Amount | $ 1,052 | $ 1,133 | $ 1,261 | ||
Percentage of Amount Assumed to Net | 21.50% | 17.60% | 23.30% | ||
Operating segments | Other | |||||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||||
Gross Amount | $ 251 | ||||
Ceded to other Companies | [2] | $ 0 | $ 0 | (105) | [1] |
Assumed From Other Companies | [1] | 206 | |||
Net Amount | $ 0 | $ 0 | $ 353 | ||
Percentage of Amount Assumed to Net | 58.40% | ||||
[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.[2]Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations. |
Schedule VI - Supplementary I_2
Schedule VI - Supplementary Information For Property and Casualty Insurance Underwriters (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SEC Schedule, 12-18, Supplemental Information, Property-Casualty Insurance Underwriters [Line Items] | |||
Net Losses and Loss Adjustment Expenses Incurred Related to Current Year | $ 6,784 | $ 5,797 | $ 4,940 |
Net Losses and Loss Adjustment Expenses Incurred Related to Prior Years | (538) | (769) | (355) |
Consolidated Subsidiaries | |||
SEC Schedule, 12-18, Supplemental Information, Property-Casualty Insurance Underwriters [Line Items] | |||
Deferred Acquisition Costs | 1,531 | 1,263 | 901 |
Reserves for Losses and Loss Adjustment Expenses | 22,752 | 20,032 | 17,758 |
Discount, if any, deducted in Column C | 66 | 61 | 56 |
Unearned Premiums | 8,808 | 7,337 | 6,012 |
Net Premiums Earned | 12,440 | 9,679 | 8,082 |
Net investment income | 1,023 | 496 | 389 |
Net Losses and Loss Adjustment Expenses Incurred Related to Current Year | 6,784 | 5,797 | 4,940 |
Net Losses and Loss Adjustment Expenses Incurred Related to Prior Years | (538) | (769) | (355) |
Amortization of Deferred Acquisition Costs | 2,312 | 1,740 | 1,303 |
Net Paid Losses and Loss Adjustment Expenses | 4,093 | 3,141 | 2,827 |
Net Premiums Written | $ 13,468 | $ 11,078 | $ 9,017 |