ý
|
Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year ended December 31, 2016,
|
¨
|
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from
to
|
Bermuda
|
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98-0392908
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification Number)
|
Title of Each Class
|
|
Name of Each Exchange on Which Registered
|
Ordinary Shares, par value $1.00 per share
|
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New York Stock Exchange
|
Preferred Shares, Series C, par value $1.00 per share
|
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New York Stock Exchange
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Large accelerated filer
|
ý
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Accelerated filer
|
¨
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Non-accelerated filer
|
¨
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Smaller reporting company
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¨
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Page
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PART I
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Item 1.
|
||
Item 1A
.
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||
Item 1B
.
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||
Item 2.
|
||
Item 3.
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||
Item 4.
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||
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PART II
|
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|
Item 5.
|
||
Item 6.
|
||
Item 7.
|
||
Item 7A.
|
||
Item 8.
|
||
Item 9.
|
||
Item 9A.
|
||
Item 9B.
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||
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PART III
|
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|
|
|
|
Item 10.
|
||
Item 11.
|
||
Item 12.
|
||
Item 13.
|
||
Item 14.
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||
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PART IV
|
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|
|
|
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Item 15.
|
||
Item 16.
|
•
|
the effects of competitors' pricing policies, and of changes in laws and regulations on competition, industry consolidation and development of competing financial products;
|
•
|
greater frequency or severity of claims and loss activity, including as a result of natural or man-made catastrophic events or as a result of changing climate conditions, than our underwriting, reserving or investment practices have anticipated;
|
•
|
changes in market conditions in the agriculture industry, which may vary depending upon demand for agricultural products, weather, commodity prices, natural disasters, technological advances in agricultural practices, changes in U.S. and foreign legislation and policies related to agricultural products and producers;
|
•
|
termination of or changes in the terms of the U.S. multiple peril crop insurance program and termination or changes to the U.S. Farm Bill, including modifications to the Standard Reinsurance Agreement put in place by the Risk Management Agency of the U.S. Department of Agriculture;
|
•
|
decreased demand for property and casualty insurance or reinsurance or increased competition due to an increase in capacity of property and casualty insurers and reinsurers;
|
•
|
changes in the availability, cost or quality of reinsurance or retrocessional coverage;
|
•
|
the inability to renew business previously underwritten or acquired;
|
•
|
the inability to obtain or maintain financial strength or claims-paying ratings by one or more of our subsidiaries;
|
•
|
our ability to effectively integrate acquired operations and to continue to expand our business;
|
•
|
uncertainties in our reserving process, including the potential for adverse development of our loss reserves or failure of our loss limitation methods;
|
•
|
the ability of the counterparty institutions with which we conduct business to continue to meet their obligations to us;
|
•
|
the failure or delay of the Florida Hurricane Catastrophe Fund or private market participants in Florida to promptly pay claims, particularly following a large windstorm or of multiple smaller storms;
|
•
|
our continued ability to comply with applicable financial standards and restrictive covenants, the breach of which could trigger significant collateral or prepayment obligations;
|
•
|
Endurance Specialty Holdings Ltd. or Endurance Specialty Insurance Ltd. becomes subject to income taxes in jurisdictions outside of Bermuda;
|
•
|
changes in tax regulations or laws applicable to us, our subsidiaries, brokers or customers;
|
•
|
state, federal and foreign regulations that impede our ability to charge adequate rates and efficiently allocate capital;
|
•
|
changes in insurance regulations in the U.S. or other jurisdictions in which we operate, including the implementation of Solvency II by the European Commission;
|
•
|
the impact of the United Kingdom's June 2016 referendum on European Union membership and the potential withdrawal of the United Kingdom from the European Union;
|
•
|
reduced acceptance of our existing or new products and services;
|
•
|
loss of business provided by any one of a few brokers on whom we depend for a large portion of our revenue, and our exposure to the credit risk of our brokers;
|
•
|
actions by our competitors, many of which are larger or have greater financial resources than we do;
|
•
|
assessments by states for high risk or otherwise uninsured individuals;
|
•
|
the impact of acts of terrorism and acts of war;
|
•
|
the effects of terrorist related insurance legislation and laws;
|
•
|
the inability to retain key personnel;
|
•
|
political stability of Bermuda or other countries in which we operate;
|
•
|
changes in the political environment of certain countries in which we operate or underwrite business;
|
•
|
changes in accounting regulation, policies or practices;
|
•
|
our investment performance;
|
•
|
the valuation of our invested assets and the determination of impairments of those assets, if any;
|
•
|
the breach of our investment guidelines or the inability of those guidelines to mitigate investment risk;
|
•
|
the need for additional capital in the future, which may not be available or only available on unfavorable terms;
|
•
|
the ability to maintain the availability of our systems and safeguard the security of our data in the event of a security breach, disaster or other unanticipated event;
|
•
|
changes in general economic and/or industry specific conditions, including inflation or deflation, foreign currency exchange rates, interest rates, and other factors; and
|
•
|
the failure of Sompo Holdings, Inc. ("Sompo") to complete the acquisition of the Company.
|
•
|
Endurance Specialty Insurance Ltd. ("Endurance Bermuda"), domiciled in Bermuda with branch offices in Switzerland and Singapore;
|
•
|
Blue Capital Management Ltd. ("BCML"), domiciled in Bermuda, and manager of Blue Water Re and Blue Water Re II, also domiciled in Bermuda;
|
•
|
Endurance Assurance Corp. ("Endurance Assurance" formerly Endurance Reinsurance Corporation of America), domiciled in Delaware;
|
•
|
Endurance Worldwide Insurance Limited ("Endurance U.K."), domiciled in England with a branch office in Switzerland;
|
•
|
Endurance at Lloyd's, managing agent for Lloyd's Syndicate 5151, domiciled in England;
|
•
|
Endurance American Insurance Company ("Endurance American"), domiciled in Delaware;
|
•
|
Endurance American Specialty Insurance Company ("Endurance American Specialty"), domiciled in Delaware;
|
•
|
Endurance Risk Solutions Assurance Co. ("Endurance Risk Solutions"), domiciled in Delaware; and
|
•
|
American Agri-Business Insurance Company ("American Agri-Business"), domiciled in Texas and managed by ARMtech Insurance Services, Inc. (together with American Agri-Business, "ARMtech").
|
•
|
Create and continually refine a portfolio of specialty lines of business focused on profitability
. We participate in specific specialty lines of insurance and reinsurance that we believe have the potential to offer the highest risk-adjusted return on capital and in which we can establish a competitive advantage through our specialized teams of expert underwriters. We underwrite our business with a focus on its underlying profitability and are committed to expanding or contracting our businesses based upon the opportunities presented in the markets in which we participate.
|
•
|
Develop and maintain deep relationships with clients and distribution partners, while utilizing specialized levels of expertise and analysis in our underwriting
. Our management team and underwriters have extensive industry experience, long standing market relationships, and are specialists in the business lines in which they operate. We supplement our underwriters' knowledge and experience through the utilization of catastrophe modeling and dynamic financial analysis techniques that provide a quantitative basis for the management of our risk aggregation and correlation.
|
•
|
Employ strong risk management practices, including the purchase of reinsurance and retrocessional protection
. Our enterprise risk management framework includes sophisticated modeling technology and a detailed internal control structure that we use to manage the underwriting, investment and operational risks across the Company in order to maximize risk adjusted returns on capital. We also purchase reinsurance and retrocessional protection in order to manage our exposure to large individual risk losses and portfolio loss accumulations, to ensure our businesses are of sufficient size to be considered a lead market for their products and to reduce the overall potential for volatility.
|
•
|
Enhance shareholder value by managing a portfolio of investments designed to generate net investment income and book value growth.
We manage our investment portfolio within a risk adjusted, total return framework. We focus on implementing a portfolio management strategy designed to generate investment income and increase book value by outperforming the financial markets on a risk adjusted basis while ensuring that we have adequate liquidity to satisfy the needs of our clients, regulators, rating agencies and shareholders.
|
•
|
Proactively manage our capital base
. We proactively manage our capital by allocating resources to underwriting and investment opportunities that we believe will offer the highest risk-adjusted return. We will return capital to our shareholders when the demand for our products declines and when we believe a return of capital would be beneficial to our shareholders. The primary focus of our capital management activities is to optimize our risk adjusted return on equity while ensuring we maintain sufficient levels of risk based capital and financial flexibility as required by our clients, regulators and rating agencies.
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
Business Segments
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
||||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||||||
Insurance
|
|
$
|
2,570,494
|
|
|
$
|
1,056,254
|
|
|
$
|
2,085,901
|
|
|
$
|
880,373
|
|
|
$
|
1,716,128
|
|
|
$
|
860,406
|
|
Reinsurance
|
|
1,631,676
|
|
|
1,313,681
|
|
|
1,234,960
|
|
|
1,070,097
|
|
|
1,177,948
|
|
|
1,073,800
|
|
||||||
Total
|
|
$
|
4,202,170
|
|
|
$
|
2,369,935
|
|
|
$
|
3,320,861
|
|
|
$
|
1,950,470
|
|
|
$
|
2,894,076
|
|
|
$
|
1,934,206
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
Lines of Business
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
||||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||||||
Agriculture
|
|
$
|
760,877
|
|
|
$
|
274,952
|
|
|
$
|
840,445
|
|
|
$
|
267,890
|
|
|
$
|
866,025
|
|
|
$
|
459,149
|
|
Casualty and other specialty
|
|
657,558
|
|
|
281,256
|
|
|
514,203
|
|
|
248,554
|
|
|
396,113
|
|
|
195,927
|
|
||||||
Professional lines
|
|
461,552
|
|
|
191,596
|
|
|
344,482
|
|
|
156,918
|
|
|
263,538
|
|
|
93,640
|
|
||||||
Property, marine/energy and aviation
|
|
690,507
|
|
|
308,450
|
|
|
386,771
|
|
|
207,011
|
|
|
190,452
|
|
|
111,690
|
|
||||||
Total
|
|
$
|
2,570,494
|
|
|
$
|
1,056,254
|
|
|
$
|
2,085,901
|
|
|
$
|
880,373
|
|
|
$
|
1,716,128
|
|
|
$
|
860,406
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
Lines of Business
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
||||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||||||
Catastrophe
|
|
$
|
506,300
|
|
|
$
|
336,413
|
|
|
$
|
311,914
|
|
|
$
|
194,662
|
|
|
$
|
343,213
|
|
|
$
|
252,973
|
|
Property
|
|
250,447
|
|
|
243,697
|
|
|
209,392
|
|
|
205,999
|
|
|
287,326
|
|
|
287,235
|
|
||||||
Casualty
|
|
245,092
|
|
|
243,154
|
|
|
176,506
|
|
|
176,487
|
|
|
159,533
|
|
|
157,947
|
|
||||||
Professional lines
|
|
256,337
|
|
|
254,148
|
|
|
248,610
|
|
|
248,610
|
|
|
174,656
|
|
|
174,656
|
|
||||||
Specialty
|
|
373,500
|
|
|
236,269
|
|
|
288,538
|
|
|
244,339
|
|
|
213,220
|
|
|
200,989
|
|
||||||
Total
|
|
$
|
1,631,676
|
|
|
$
|
1,313,681
|
|
|
$
|
1,234,960
|
|
|
$
|
1,070,097
|
|
|
$
|
1,177,948
|
|
|
$
|
1,073,800
|
|
Insurance
|
|||||||||
|
|
Percentage of Gross Premiums Written
|
|||||||
Broker/Agent
|
|
2016
|
|
2015
|
|
2014
|
|||
Marsh & McLennan Companies, Inc.
|
|
11.8
|
%
|
|
10.8
|
%
|
|
10.8
|
%
|
Aon Benfield
|
|
7.1
|
%
|
|
6.7
|
%
|
|
5.9
|
%
|
Willis Companies
|
|
4.1
|
%
|
|
4.4
|
%
|
|
3.5
|
%
|
Independent agents
|
|
29.6
|
%
|
|
40.3
|
%
|
|
50.5
|
%
|
All others
|
|
47.4
|
%
|
|
37.8
|
%
|
|
29.3
|
%
|
Total
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|||
Reinsurance
|
|||||||||
|
|
Percentage of Gross Premiums Written
|
|||||||
Broker
|
|
2016
|
|
2015
|
|
2014
|
|||
Marsh & McLennan Companies, Inc.
|
|
35.1
|
%
|
|
35.1
|
%
|
|
31.3
|
%
|
Aon Benfield
|
|
25.6
|
%
|
|
22.9
|
%
|
|
23.7
|
%
|
Willis Companies
|
|
16.5
|
%
|
|
17.4
|
%
|
|
20.9
|
%
|
All others
|
|
22.8
|
%
|
|
24.6
|
%
|
|
24.1
|
%
|
Total
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
•
|
identify, assess, measure, monitor and manage the risks that threaten us and our solvency;
|
•
|
optimize our risk based capital position;
|
•
|
maximize our risk adjusted returns on capital;
|
•
|
manage underwriting, investment and operational volatility; and
|
•
|
clearly communicate our approach to our employees and external constituencies.
|
•
|
Capital position relative to internal requirements, as measured by our economic capital model, and the requirements of our regulators and rating agencies;
|
•
|
Underwriting risk exposure relative to limits for loss arising from catastrophic natural peril and man made events;
|
•
|
Reserve risk through our exposure to medium and long tailed lines of business;
|
•
|
Investment risk, through a system of limits incorporating exposure to asset class, credit rating, duration and currency;
|
•
|
Liquidity, by stressing cash outflow scenarios relative to available cash and cash equivalents and other forms of liquidity; and
|
•
|
Counterparty exposure nominally and to loss scenarios for ceded reinsurance and for non-reinsurance counterparties.
|
•
|
we will underwrite and accept only those risks we know and understand;
|
•
|
we establish pricing parameters, set our own independent pricing and conduct a risk review on risks we accept; and
|
•
|
we generally accept those risks that are expected to earn a return on capital commensurate with the risk they present.
|
•
|
the Company’s framework for the assessment and management of risk, including the definition of applicable categories of risk, standards in relation to each category of risk and the appropriate risk tolerances;
|
•
|
the policies and guidelines governing the Company's framework for the assessment and management of risk; and
|
•
|
the level of risk assumed by the Company in its underwriting, investment and operational activities, including the methods by which such risk is measured.
|
•
|
the firm systematic framework, which is designed to assess a firm's conduct risk by reference to the firm's business model and an assessment of how it embeds fair treatment of customers and ensures market integrity in its conduct of business;
|
•
|
event-driven work to enable the FCA to respond quickly to identified risks in the market; and
|
•
|
issues and product focused work to enable the FCA to deal promptly with emerging issues that might put customers at risk.
|
1.
|
ten percent of its policyholders surplus as of the 31
st
day of December of the preceding year; or
|
2.
|
the statutory net income (under Texas and California insurance laws), not including realized capital gains (under Delaware insurance laws) for the 12-month period ending, for the preceding calendar year (the 31
st
day of December next preceding).
|
•
|
An increase in the dollar magnitude of security class action settlements, particularly in the settlement of mega-cases, covered by professional liability and directors' and officers' liability insurance;
|
•
|
continued challenges to tort reform by plaintiffs with mixed results across the United States;
|
•
|
a low interest rate environment, which continues to create upward pressure on settlement values;
|
•
|
a growing trend of plaintiffs targeting property and casualty insurers relating to claims-handling practices in the adjustment of losses relating to natural disasters; and
|
•
|
securities litigation with a focus on initial public offerings and merger and acquisition activities.
|
•
|
potential losses from unanticipated litigation or levels of claims;
|
•
|
the inability to generate sufficient revenue to offset acquisition costs;
|
•
|
the value of assets related to acquisitions or new ventures may be lower than expected or may diminish due to credit defaults or changes in interest rates and liabilities assumed may be greater than expected;
|
•
|
the assets and liabilities related to acquisitions or new ventures may be subject to foreign currency exchange rate fluctuation; and
|
•
|
financial exposures in the event that sellers of the entities we acquire are unable or unwilling to meet their indemnification, reinsurance and other obligations to us.
|
•
|
having exposure to the Council of Lloyd's (the "Council") wide discretionary powers to regulate members of Lloyd's, including the Council's power to vary the method by which the capital solvency ratio is calculated;
|
•
|
being subject to increased capital requirements due to changes in regulation;
|
•
|
facing reputational issues arising from the actions of other Lloyd's syndicates;
|
•
|
being subject to potential changes in business strategy due to requirements of the Lloyd's Franchise Board (which is responsible for the day-to-day management of the Lloyd's market);
|
•
|
reduced underwriting capacity for the Company due to a reduction in the funds held in trust at Lloyd's (as a result of changes in the market value of investments or otherwise) to support underwriting activities;
|
•
|
being required to cease or reduce underwriting if Lloyd's fails to satisfy the FCA's and the PRA's annual solvency test in any given year;
|
•
|
having a reduced ability to trade in certain classes of business at current levels as a consequence of a downgrading of the Lloyd's market;
|
•
|
being subject to additional or special levies imposed by the Council; and
|
•
|
as a Lloyd's syndicate transacting certain types of business in the United States, being required by U.S. regulators to increase the level of funding required as minimum deposits for the protection of U.S. policyholders and, as a consequence, being required to make cash calls to meet claims payments and deposit funding obligations.
|
•
|
The Company’s current stock price reflects a market assumption that the Merger will occur. If the Merger is not consummated, the investment goals of our shareholders may be materially different than those of our shareholders on a pre-Merger announcement basis.
|
•
|
Under certain circumstances, the Company may be required to pay a termination fee of $204.9 million and reimburse Sompo's expenses relating to the Merger up to $15.8 million;
|
•
|
The Company may be required to pay significant costs relating to the Merger, such as legal, accounting, financial advisory and printing fees, whether or not the Merger is completed;
|
•
|
Time and resources committed by the Company's management to matters relating to the Merger could otherwise have been devoted to the Company's existing business or to pursuing other beneficial opportunities;
|
•
|
The Merger may not have been completed as a result of the occurrence of an event, change or other circumstances that have a material adverse effect on the Company’s business;
|
•
|
The manner in which brokers, insurers, cedants and other third parties perceive the Company may be negatively impacted, which in turn could affect the ability of the Company to compete for or write new business or obtain renewals in the marketplace;
|
•
|
The Company's ratings may be adversely affected, which could have an adverse effect on its business, financial condition and operating results; and
|
•
|
The Company could be subject to litigation related to any failure to complete the Merger or related to any enforcement proceeding commenced against the Company to perform its obligations under the Merger Agreement.
|
|
|
High
|
|
Low
|
||||
2016
|
|
|
|
|
||||
First quarter
|
|
$
|
65.69
|
|
|
$
|
59.35
|
|
Second quarter
|
|
$
|
68.85
|
|
|
$
|
62.89
|
|
Third quarter
|
|
$
|
68.68
|
|
|
$
|
64.49
|
|
Fourth quarter
|
|
$
|
92.60
|
|
|
$
|
64.96
|
|
2015
|
|
|
|
|
||||
First quarter
|
|
$
|
64.72
|
|
|
$
|
59.17
|
|
Second quarter
|
|
$
|
66.51
|
|
|
$
|
60.38
|
|
Third quarter
|
|
$
|
69.49
|
|
|
$
|
60.54
|
|
Fourth quarter
|
|
$
|
66.96
|
|
|
$
|
60.93
|
|
|
|
12/11
|
|
12/12
|
|
12/13
|
|
12/14
|
|
12/15
|
|
12/16
|
||||||
Endurance Specialty Holdings Ltd.
|
|
100.00
|
|
|
107.12
|
|
|
162.42
|
|
|
169.84
|
|
|
185.70
|
|
|
274.01
|
|
S&P 500
|
|
100.00
|
|
|
116.00
|
|
|
153.58
|
|
|
174.60
|
|
|
177.01
|
|
|
198.18
|
|
S&P Property & Casualty Insurance
|
|
100.00
|
|
|
120.11
|
|
|
166.10
|
|
|
192.25
|
|
|
210.57
|
|
|
243.65
|
|
For the years ended December 31,
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
Selected Income Statement Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Gross premiums written
|
|
$
|
4,202,170
|
|
|
$
|
3,320,861
|
|
|
$
|
2,894,076
|
|
|
$
|
2,665,244
|
|
|
$
|
2,549,026
|
|
Net premiums written
|
|
2,369,935
|
|
|
1,950,470
|
|
|
1,934,206
|
|
|
2,048,933
|
|
|
2,029,495
|
|
|||||
Net premiums earned
|
|
2,363,660
|
|
|
1,978,453
|
|
|
1,863,978
|
|
|
2,016,484
|
|
|
2,013,900
|
|
|||||
Net investment income
|
|
176,590
|
|
|
113,826
|
|
|
131,543
|
|
|
166,216
|
|
|
173,326
|
|
|||||
Net realized and unrealized (losses) gains
|
|
(12,419
|
)
|
|
12,660
|
|
|
14,283
|
|
|
15,164
|
|
|
72,139
|
|
|||||
Net impairment losses recognized in earnings
|
|
(10,769
|
)
|
|
(3,715
|
)
|
|
(625
|
)
|
|
(1,616
|
)
|
|
(847
|
)
|
|||||
Net losses and loss expenses
|
|
1,321,052
|
|
|
917,108
|
|
|
970,162
|
|
|
1,219,684
|
|
|
1,520,995
|
|
|||||
Acquisition expenses
|
|
460,483
|
|
|
347,885
|
|
|
319,513
|
|
|
304,430
|
|
|
303,179
|
|
|||||
General and administrative expenses
|
|
248,146
|
|
|
259,791
|
|
|
247,387
|
|
|
236,873
|
|
|
211,763
|
|
|||||
Corporate expenses
|
|
51,706
|
|
|
114,429
|
|
|
66,200
|
|
|
58,033
|
|
|
23,926
|
|
|||||
Net income
|
|
381,147
|
|
|
355,111
|
|
|
348,450
|
|
|
311,915
|
|
|
162,516
|
|
|||||
Net income attributable to non-controlling interests
|
|
(24,130
|
)
|
|
(11,016
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income available to Endurance Holdings
|
|
357,017
|
|
|
344,095
|
|
|
348,450
|
|
|
311,915
|
|
|
162,516
|
|
|||||
Preferred dividends
|
|
23,799
|
|
|
32,750
|
|
|
32,750
|
|
|
32,750
|
|
|
32,750
|
|
|||||
Net income available to Endurance Holdings' common and participating shareholders
|
|
333,218
|
|
|
311,345
|
|
|
315,700
|
|
|
279,165
|
|
|
129,766
|
|
|||||
Per Share Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividends declared and paid per common share
|
|
$
|
1.52
|
|
|
$
|
1.40
|
|
|
$
|
1.36
|
|
|
$
|
1.28
|
|
|
$
|
1.24
|
|
Basic earnings per common share
|
|
$
|
4.94
|
|
|
$
|
5.74
|
|
|
$
|
7.07
|
|
|
$
|
6.37
|
|
|
$
|
3.00
|
|
Diluted earnings per common share
|
|
$
|
4.93
|
|
|
$
|
5.73
|
|
|
$
|
7.06
|
|
|
$
|
6.37
|
|
|
$
|
3.00
|
|
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
65,992
|
|
|
52,707
|
|
|
43,368
|
|
|
42,818
|
|
|
42,568
|
|
|||||
Diluted
|
|
66,135
|
|
|
52,829
|
|
|
43,415
|
|
|
42,818
|
|
|
42,602
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
As of December 31,
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
Selected Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and investments
|
|
$
|
8,960,515
|
|
|
$
|
8,945,156
|
|
|
$
|
6,719,889
|
|
|
$
|
6,574,787
|
|
|
$
|
6,638,942
|
|
Total assets
|
|
14,122,861
|
|
|
13,241,525
|
|
|
9,640,684
|
|
|
8,973,097
|
|
|
8,789,035
|
|
|||||
Reserve for losses and loss expenses
|
|
4,905,138
|
|
|
4,510,415
|
|
|
3,846,859
|
|
|
4,002,259
|
|
|
4,240,876
|
|
|||||
Reserve for unearned premiums
|
|
1,994,676
|
|
|
1,789,148
|
|
|
1,254,519
|
|
|
1,018,851
|
|
|
965,244
|
|
|||||
Debt
|
|
705,292
|
|
|
717,650
|
|
|
523,617
|
|
|
522,453
|
|
|
521,402
|
|
|||||
Preferred stock, Series A non-cumulative
|
|
—
|
|
|
—
|
|
|
8,000
|
|
|
8,000
|
|
|
8,000
|
|
|||||
Preferred stock, Series B non-cumulative
|
|
—
|
|
|
9,200
|
|
|
9,200
|
|
|
9,200
|
|
|
9,200
|
|
|||||
Preferred stock, Series C non-cumulative
|
|
9
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total shareholders' equity available to Endurance Holdings
|
|
4,882,439
|
|
|
4,856,262
|
|
|
3,185,182
|
|
|
2,886,549
|
|
|
2,710,597
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Selected Ratios (based on U.S. GAAP income statement data):
|
|
|
|
|
||||||||||||||||
For the years ended December 31,
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
Net loss ratio
(a)
|
|
55.9
|
%
|
|
46.4
|
%
|
|
52.1
|
%
|
|
60.5
|
%
|
|
75.5
|
%
|
|||||
Acquisition expense ratio
(b)
|
|
19.5
|
%
|
|
17.6
|
%
|
|
17.1
|
%
|
|
15.1
|
%
|
|
15.1
|
%
|
|||||
General and administrative expense ratio
(c)
|
|
12.7
|
%
|
|
18.9
|
%
|
|
16.8
|
%
|
|
14.6
|
%
|
|
11.7
|
%
|
|||||
Combined ratio
(d)
|
|
88.1
|
%
|
|
82.9
|
%
|
|
86.0
|
%
|
|
90.2
|
%
|
|
102.3
|
%
|
(a)
|
The net loss ratio is calculated by dividing net losses and loss expenses by net premiums earned.
|
(b)
|
The acquisition expense ratio is calculated by dividing acquisition expenses by net premiums earned.
|
(c)
|
The general and administrative expense ratio includes general and administrative expenses and corporate expenses. The general and administrative expense ratio is calculated by dividing general and administrative expenses and corporate expenses by net premiums earned.
|
(d)
|
The combined ratio is the sum of the net loss ratio, the acquisition expense ratio and the general and administrative expense ratio. Our historical combined ratio may not be indicative of future underwriting performance.
|
•
|
Endurance Specialty Insurance Ltd. ("Endurance Bermuda"), domiciled in Bermuda with branch offices in Switzerland and Singapore;
|
•
|
Blue Capital Management Ltd. ("BCML"), domiciled in Bermuda, manager of Blue Water Re Ltd. ("Blue Water Re") and Blue Water Re II Ltd. ("Blue Water Re II"), domiciled in Bermuda;
|
•
|
Endurance Assurance Corp. ("Endurance Assurance," formerly Endurance Reinsurance Corporation of America), domiciled in Delaware;
|
•
|
Endurance Worldwide Insurance Limited ("Endurance U.K."), domiciled in England with a branch office in Switzerland;
|
•
|
Endurance at Lloyd's Limited ("Endurance at Lloyd's"), managing agent for Lloyd's Syndicate 5151 ("Syndicate 5151"), domiciled in England;
|
•
|
Endurance American Insurance Company ("Endurance American"), domiciled in Delaware;
|
•
|
Endurance American Specialty Insurance Company ("Endurance American Specialty"), domiciled in Delaware;
|
•
|
Endurance Risk Solutions Assurance Co. ("Endurance Risk Solutions"), domiciled in Delaware; and
|
•
|
American Agri-Business Insurance Company ("American Agri-Business"), domiciled in Texas and managed by ARMtech Insurance Services, Inc. (together with American Agri-Business, "ARMtech").
|
•
|
it requires assumptions to be made that were uncertain at the time the estimate was made; and
|
•
|
changes in the estimate or different estimates that could have been selected could have a material impact on the Company's consolidated results of operations or financial condition.
|
•
|
the ceding company's historical premium versus projected premium;
|
•
|
the ceding company's history of providing accurate estimates;
|
•
|
anticipated changes in the marketplace and the ceding company's competitive position therein;
|
•
|
reported premiums to date; and
|
•
|
correspondence and communication between the Company and its brokers, intermediaries and ceding companies.
|
Classes of Coverage
|
|
Casualty
|
|
Professional
lines
|
|
Property
|
|
Other
specialty
|
|
Total
|
||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||
As of December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Proportional premiums receivable, net
|
|
$
|
98,654
|
|
|
$
|
108,733
|
|
|
$
|
183,644
|
|
|
$
|
86,249
|
|
|
$
|
477,280
|
|
As of December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Proportional premiums receivable, net
|
|
$
|
73,328
|
|
|
$
|
113,313
|
|
|
$
|
137,334
|
|
|
$
|
57,948
|
|
|
$
|
381,923
|
|
•
|
the information developed from internal and external sources can be used to develop meaningful estimates of the likely future performance of business bound by the Company;
|
•
|
the loss and exposure information provided by ceding companies, insureds and brokers in support of their submissions can be used to derive meaningful estimates of the likely future performance of business bound with respect to each contract and policy;
|
•
|
historic loss development and trend experience is assumed to be indicative of future loss development and trends;
|
•
|
no significant emergence of losses or types of losses that are not represented in the information supplied to the Company by its brokers, ceding companies and insureds will occur; and
|
•
|
the terms of the contracts and policies the Company entered into with its insureds and ceding companies will be interpreted as intended, including those related to applicable aggregation limits and occurrence definitions.
|
•
|
the delay between the time claims are reported to the ceding company and the time they are reported through one or more reinsurance broker intermediaries to the Company;
|
•
|
the differing reserving practices among ceding companies;
|
•
|
the diversity of loss development patterns among different types of reinsurance treaties or contracts;
|
•
|
the Company's need to rely on its ceding companies for loss information; and
|
•
|
the fact that reinsurance treaties typically cover a disproportionate amount of large and more complicated claims.
|
•
|
changes in the inflation rate for goods and services related to the covered damages;
|
•
|
changes in the general economic environment that could cause unanticipated changes in claim frequency or severity;
|
•
|
changes in the litigation environment regarding the representation of plaintiffs and potential plaintiffs;
|
•
|
changes in the judicial and/or arbitration environment regarding the interpretation of policy and contract provisions relating to the determination of coverage and/or the amount of damages awarded for certain types of claims;
|
•
|
changes in the social environment regarding the general attitude of juries in the determination of liability and damages;
|
•
|
changes in the legislative environment regarding the definition of damages;
|
•
|
new types of injuries caused by new types of injurious activities or exposures; and
|
•
|
in the case of assumed reinsurance, changes in ceding company case reserving and reporting patterns.
|
•
|
alterations in claims handling procedures;
|
•
|
growth in new lines of business where exposure and loss development patterns are not well established; or
|
•
|
changes in the quality of risk selection or pricing in the underwriting process.
|
•
|
quantitative analysis (consisting of comparing the quarterly return for each managed portfolio to its target benchmark, with significant differences identified and investigated);
|
•
|
corroborating prices;
|
•
|
initial and ongoing evaluation of methodologies used by outside parties to calculate fair value; and
|
•
|
comparing the fair value estimates to its knowledge of the current market.
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Revenues
|
|
|
|
|
|
|
||||||
Gross premiums written
|
|
$
|
4,202,170
|
|
|
$
|
3,320,861
|
|
|
$
|
2,894,076
|
|
Ceded premiums written
|
|
(1,832,235
|
)
|
|
(1,370,391
|
)
|
|
(959,870
|
)
|
|||
Net premiums written
|
|
2,369,935
|
|
|
1,950,470
|
|
|
1,934,206
|
|
|||
Net premiums earned
|
|
2,363,660
|
|
|
1,978,453
|
|
|
1,863,978
|
|
|||
Net investment income
|
|
176,590
|
|
|
113,826
|
|
|
131,543
|
|
|||
Net realized and unrealized (losses) gains
|
|
(12,419
|
)
|
|
12,660
|
|
|
14,283
|
|
|||
Net impairment losses recognized in earnings
|
|
(10,769
|
)
|
|
(3,715
|
)
|
|
(625
|
)
|
|||
Other underwriting loss
|
|
(909
|
)
|
|
(3,694
|
)
|
|
(5,786
|
)
|
|||
Total revenues
|
|
2,516,153
|
|
|
2,097,530
|
|
|
2,003,393
|
|
|||
Expenses
|
|
|
|
|
|
|
||||||
Net losses and loss expenses
|
|
1,321,052
|
|
|
917,108
|
|
|
970,162
|
|
|||
Acquisition expenses
|
|
460,483
|
|
|
347,885
|
|
|
319,513
|
|
|||
General and administrative expenses
|
|
248,146
|
|
|
259,791
|
|
|
247,387
|
|
|||
Corporate expenses
|
|
51,706
|
|
|
114,429
|
|
|
66,200
|
|
|||
Amortization of intangibles
|
|
84,624
|
|
|
30,620
|
|
|
6,484
|
|
|||
Net foreign exchange (gains) losses
|
|
(74,684
|
)
|
|
26,964
|
|
|
3,839
|
|
|||
Interest expense
|
|
43,860
|
|
|
41,260
|
|
|
40,968
|
|
|||
Income tax (benefit) expense
|
|
(181
|
)
|
|
4,362
|
|
|
390
|
|
|||
Total expenses
|
|
2,135,006
|
|
|
1,742,419
|
|
|
1,654,943
|
|
|||
Net income
|
|
381,147
|
|
|
355,111
|
|
|
348,450
|
|
|||
Net income attributable to non-controlling interests
|
|
(24,130
|
)
|
|
(11,016
|
)
|
|
—
|
|
|||
Preferred dividends
|
|
(23,799
|
)
|
|
(32,750
|
)
|
|
(32,750
|
)
|
|||
Net income available to Endurance Holdings' common and participating common shareholders
|
|
$
|
333,218
|
|
|
$
|
311,345
|
|
|
$
|
315,700
|
|
Ratios
|
|
|
|
|
|
|
||||||
Net loss ratio
|
|
55.9
|
%
|
|
46.4
|
%
|
|
52.1
|
%
|
|||
Acquisition expense ratio
|
|
19.5
|
%
|
|
17.6
|
%
|
|
17.1
|
%
|
|||
General and administrative expense ratio
(1)
|
|
12.7
|
%
|
|
18.9
|
%
|
|
16.8
|
%
|
|||
Combined ratio
|
|
88.1
|
%
|
|
82.9
|
%
|
|
86.0
|
%
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
United States
|
|
$
|
2,823,950
|
|
|
$
|
2,305,301
|
|
|
$
|
2,054,431
|
|
Worldwide
|
|
794,289
|
|
|
566,664
|
|
|
456,078
|
|
|||
Europe
|
|
265,100
|
|
|
209,729
|
|
|
172,077
|
|
|||
Asia
|
|
105,838
|
|
|
75,165
|
|
|
38,442
|
|
|||
Japan
|
|
82,864
|
|
|
58,524
|
|
|
45,618
|
|
|||
Australasia
|
|
49,727
|
|
|
41,309
|
|
|
61,994
|
|
|||
Other
|
|
80,402
|
|
|
64,169
|
|
|
65,436
|
|
|||
Total gross premiums written
|
|
$
|
4,202,170
|
|
|
$
|
3,320,861
|
|
|
$
|
2,894,076
|
|
•
|
An increase in gross premiums written in the property, marine/energy and aviation line of business in the Insurance segment, due primarily to business generated by new underwriting teams added over the last twenty four months in the U.S. and the U.K., including new business resulting from the acquisition of Montpelier;
|
•
|
An increase in gross premiums written in the catastrophe and property lines of business in the Reinsurance segment compared to
2015
primarily due to new business resulting from the Company's acquisition of Montpelier, partially offset by targeted line size reductions;
|
•
|
An increase in gross premiums written in the casualty and other specialty and professional lines of business in the Insurance segment, including excess casualty and various professional liability coverages, due to the expansion of the Company's Insurance underwriting personnel over the last twenty four months, including new business resulting from the acquisition of Montpelier;
|
•
|
An increase in gross premiums written in the specialty line of business in the Reinsurance segment, primarily due to growth in international marine, aerospace, trade credit and surety and agriculture business written by new underwriting teams, partially offset by non-renewals due to increased ceding company retentions;
|
•
|
An increase in gross premiums written in the casualty and professional lines of business in the Reinsurance segment compared to 2015 and 2014 due to new business written and increased premiums on renewal business, partially offset by non-renewal of policies that no longer met profitability targets; and
|
•
|
A decrease in gross premiums written in the agriculture line of business in the Insurance segment due to lower commodity prices and from reductions in the Company's crop hail portfolio.
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Fixed income investments
|
|
$
|
165,210
|
|
|
$
|
132,786
|
|
|
$
|
118,084
|
|
Equity securities
|
|
12,639
|
|
|
8,209
|
|
|
5,689
|
|
|||
Other investments
|
|
12,442
|
|
|
(13,553
|
)
|
|
19,609
|
|
|||
Cash and cash equivalents
|
|
2,824
|
|
|
2,870
|
|
|
2,445
|
|
|||
|
|
$
|
193,115
|
|
|
$
|
130,312
|
|
|
$
|
145,827
|
|
Investment expenses
|
|
(16,525
|
)
|
|
(16,486
|
)
|
|
(14,284
|
)
|
|||
Net investment income
|
|
$
|
176,590
|
|
|
$
|
113,826
|
|
|
$
|
131,543
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Gross realized gains on investment sales
|
|
$
|
39,033
|
|
|
$
|
65,881
|
|
|
$
|
35,921
|
|
Gross realized losses on investment sales
|
|
(61,752
|
)
|
|
(28,636
|
)
|
|
(16,515
|
)
|
|||
Net unrealized gains (losses) on trading securities
|
|
12,480
|
|
|
(24,257
|
)
|
|
—
|
|
|||
Intangible asset impairment loss
|
|
—
|
|
|
—
|
|
|
(5,450
|
)
|
|||
Change in fair value of derivative financial instruments
|
|
(2,180
|
)
|
|
(328
|
)
|
|
327
|
|
|||
Net realized and unrealized (losses) gains
|
|
$
|
(12,419
|
)
|
|
$
|
12,660
|
|
|
$
|
14,283
|
|
2016
|
||||||
Event Date
|
|
Event
|
|
Net Loss
|
||
(U.S. dollars in millions)
|
||||||
February 2016
|
|
Earthquake in Taiwan
|
|
$
|
6.2
|
|
February and March 2016
|
|
Jubilee oil field
|
|
9.4
|
|
|
April 2016
|
|
Convective storms in the United States
|
|
22.6
|
|
|
April 2016
|
|
Earthquake in Japan
|
|
9.6
|
|
|
May 2016
|
|
Wildfires in Canada
|
|
30.4
|
|
|
May 2016
|
|
Convective Storms in Germany
|
|
4.1
|
|
|
June 2016
|
|
Hailstorms in the Netherlands
|
|
10.0
|
|
|
September 2016
|
|
Typhoon Meranti in Asia
|
|
8.3
|
|
|
October 2016
|
|
Hurricane Matthew in the United States
|
|
59.8
|
|
|
November 2016
|
|
Earthquake in New Zealand
|
|
14.5
|
|
|
|
|
Total impact on net losses and loss expenses
|
|
174.9
|
|
|
|
|
Less: reinstatement premiums
|
|
(21.5
|
)
|
|
|
|
Net losses after adjustment for reinstatement premiums
|
|
$
|
153.4
|
|
|
||||||
2015
|
||||||
Event Date
|
|
Event
|
|
Net Loss
|
||
(U.S. dollars in millions)
|
||||||
February 2015
|
|
Winter storm in the United States
|
|
$
|
12.9
|
|
April 2015
|
|
Windstorm in the United States
|
|
7.4
|
|
|
May 2015
|
|
Windstorm in the United States
|
|
6.4
|
|
|
August 2015
|
|
Tianjin explosions
|
|
14.1
|
|
|
August 2015
|
|
Unipetrol fire
|
|
9.2
|
|
|
|
|
Total impact on net losses and loss expenses
|
|
50.0
|
|
|
|
|
Less: reinstatement premiums
|
|
(3.1
|
)
|
|
|
|
Net losses after adjustment for reinstatement premiums
|
|
$
|
46.9
|
|
|
||||||
2014
|
||||||
Event Date
|
|
Event
|
|
Net Loss
|
||
(U.S. dollars in millions)
|
||||||
February 2014
|
|
Windstorm in Japan
|
|
$
|
7.2
|
|
April 2014
|
|
Windstorms in the United States
|
|
8.1
|
|
|
May 2014
|
|
Windstorms in the United States
|
|
2.9
|
|
|
June 2014
|
|
Windstorms in the United States
|
|
5.6
|
|
|
June 2014
|
|
Windstorm Ela in Europe
|
|
21.1
|
|
|
November 2014
|
|
Windstorm in Australia
|
|
6.3
|
|
|
|
|
Other loss events in 2014
|
|
5.0
|
|
|
|
|
Total impact on net losses and loss expenses
|
|
56.2
|
|
|
|
|
Less: reinstatement premiums
|
|
(5.1
|
)
|
|
|
|
Net losses after adjustment for reinstatement premiums
|
|
$
|
51.1
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Revenues
|
|
|
|
|
|
|
||||||
Gross premiums written
|
|
$
|
2,570,494
|
|
|
$
|
2,085,901
|
|
|
$
|
1,716,128
|
|
Ceded premiums written
|
|
(1,514,240
|
)
|
|
(1,205,528
|
)
|
|
(855,722
|
)
|
|||
Net premiums written
|
|
1,056,254
|
|
|
880,373
|
|
|
860,406
|
|
|||
Net premiums earned
|
|
1,009,375
|
|
|
824,552
|
|
|
833,912
|
|
|||
Expenses
|
|
|
|
|
|
|
||||||
Net losses and loss expenses
|
|
684,178
|
|
|
500,867
|
|
|
594,561
|
|
|||
Acquisition expenses
|
|
149,763
|
|
|
80,252
|
|
|
65,368
|
|
|||
General and administrative expenses
|
|
140,742
|
|
|
140,012
|
|
|
148,475
|
|
|||
|
|
974,683
|
|
|
721,131
|
|
|
808,404
|
|
|||
Underwriting income
|
|
$
|
34,692
|
|
|
$
|
103,421
|
|
|
$
|
25,508
|
|
|
|
|
|
|
|
|
||||||
Ratios
|
|
|
|
|
|
|
||||||
Net loss ratio
|
|
67.9
|
%
|
|
60.8
|
%
|
|
71.4
|
%
|
|||
Acquisition expense ratio
|
|
14.8
|
%
|
|
9.7
|
%
|
|
7.8
|
%
|
|||
General and administrative expense ratio
|
|
13.9
|
%
|
|
17.0
|
%
|
|
17.7
|
%
|
|||
Combined ratio
|
|
96.6
|
%
|
|
87.5
|
%
|
|
96.9
|
%
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
||||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||||||
Agriculture
|
|
$
|
760,877
|
|
|
$
|
274,952
|
|
|
$
|
840,445
|
|
|
$
|
267,890
|
|
|
$
|
866,025
|
|
|
$
|
459,149
|
|
Casualty and other specialty
|
|
657,558
|
|
|
281,256
|
|
|
514,203
|
|
|
248,554
|
|
|
396,113
|
|
|
195,927
|
|
||||||
Professional lines
|
|
461,552
|
|
|
191,596
|
|
|
344,482
|
|
|
156,918
|
|
|
263,538
|
|
|
93,640
|
|
||||||
Property, marine/energy and aviation
|
|
690,507
|
|
|
308,450
|
|
|
386,771
|
|
|
207,011
|
|
|
190,452
|
|
|
111,690
|
|
||||||
Total
|
|
$
|
2,570,494
|
|
|
$
|
1,056,254
|
|
|
$
|
2,085,901
|
|
|
$
|
880,373
|
|
|
$
|
1,716,128
|
|
|
$
|
860,406
|
|
•
|
An increase in gross premiums written in the property, marine/energy and aviation line of business, due primarily to business generated by new underwriting teams added over the last twelve months in the U.S. and the U.K., including new business resulting from the acquisition of Montpelier;
|
•
|
An increase in gross premiums written in the casualty and other specialty and professional lines of business, including excess casualty and various professional liability coverages, due to the expansion of the Company's Insurance underwriting personnel over the past twenty four months, as well as new business resulting from the acquisition of Montpelier; and
|
•
|
A decrease in gross premiums written in the agriculture line of business due to lower commodity prices and reduced policy counts from reunderwriting related to the Company's crop hail portfolio.
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Revenues
|
|
|
|
|
|
|
||||||
Gross premiums written
|
|
$
|
1,631,676
|
|
|
$
|
1,234,960
|
|
|
$
|
1,177,948
|
|
Ceded premiums written
|
|
(317,995
|
)
|
|
(164,863
|
)
|
|
(104,148
|
)
|
|||
Net premiums written
|
|
1,313,681
|
|
|
1,070,097
|
|
|
1,073,800
|
|
|||
Net premiums earned
|
|
1,354,285
|
|
|
1,153,901
|
|
|
1,030,066
|
|
|||
Other underwriting loss
|
|
(909
|
)
|
|
(3,694
|
)
|
|
(5,786
|
)
|
|||
|
|
1,353,376
|
|
|
1,150,207
|
|
|
1,024,280
|
|
|||
Expenses
|
|
|
|
|
|
|
||||||
Net losses and loss expenses
|
|
636,874
|
|
|
416,241
|
|
|
375,601
|
|
|||
Acquisition expenses
|
|
310,720
|
|
|
267,633
|
|
|
254,145
|
|
|||
General and administrative expenses
|
|
107,404
|
|
|
119,779
|
|
|
98,912
|
|
|||
|
|
1,054,998
|
|
|
803,653
|
|
|
728,658
|
|
|||
Underwriting income
|
|
$
|
298,378
|
|
|
$
|
346,554
|
|
|
$
|
295,622
|
|
|
|
|
|
|
|
|
||||||
Ratios
|
|
|
|
|
|
|
||||||
Net loss ratio
|
|
47.1
|
%
|
|
36.0
|
%
|
|
36.4
|
%
|
|||
Acquisition expense ratio
|
|
22.9
|
%
|
|
23.2
|
%
|
|
24.7
|
%
|
|||
General and administrative expense ratio
|
|
7.9
|
%
|
|
10.4
|
%
|
|
9.6
|
%
|
|||
Combined ratio
|
|
77.9
|
%
|
|
69.6
|
%
|
|
70.7
|
%
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
|
Gross
Premiums
Written
|
|
Net
Premiums
Written
|
||||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||||||
Catastrophe
|
|
$
|
506,300
|
|
|
$
|
336,413
|
|
|
$
|
311,914
|
|
|
$
|
194,662
|
|
|
$
|
343,213
|
|
|
$
|
252,973
|
|
Property
|
|
250,447
|
|
|
243,697
|
|
|
209,392
|
|
|
205,999
|
|
|
287,326
|
|
|
287,235
|
|
||||||
Casualty
|
|
245,092
|
|
|
243,154
|
|
|
176,506
|
|
|
176,487
|
|
|
159,533
|
|
|
157,947
|
|
||||||
Professional lines
|
|
256,337
|
|
|
254,148
|
|
|
248,610
|
|
|
248,610
|
|
|
174,656
|
|
|
174,656
|
|
||||||
Specialty
|
|
373,500
|
|
|
236,269
|
|
|
288,538
|
|
|
244,339
|
|
|
213,220
|
|
|
200,989
|
|
||||||
Total
|
|
$
|
1,631,676
|
|
|
$
|
1,313,681
|
|
|
$
|
1,234,960
|
|
|
$
|
1,070,097
|
|
|
$
|
1,177,948
|
|
|
$
|
1,073,800
|
|
•
|
An increase in gross premiums written in the catastrophe and property lines of business compared to 2015 primarily due to new business resulting from the Company's acquisition of Montpelier, partially offset by targeted line size reductions;
|
•
|
An increase in gross premiums written in the specialty line of business compared to 2015 and 2014 primarily due to growth in international marine, aerospace, trade credit and surety and agriculture business written by new underwriting teams, partially offset by non-renewals due to increased ceding company retentions; and
|
•
|
An increase in gross premiums written in the casualty and professional lines of business compared to 2015 and 2014 due to new business written, including those acquired from Montpelier and increased premiums on renewal business, partially offset by non-renewal of policies that no longer met profitability targets.
|
|
|
2016
|
|
2015
|
||||
|
|
(U.S. dollars in thousands)
|
||||||
Fixed maturity investments
|
|
|
|
|
||||
U.S. government and agencies securities
|
|
$
|
1,001,882
|
|
|
$
|
818,468
|
|
U.S. state and municipal securities
|
|
18,357
|
|
|
22,406
|
|
||
Foreign government securities
|
|
178,919
|
|
|
160,976
|
|
||
Government guaranteed corporate securities
|
|
3,917
|
|
|
57,753
|
|
||
Corporate securities
|
|
2,147,693
|
|
|
1,849,934
|
|
||
Residential mortgage-backed securities
|
|
1,461,286
|
|
|
1,311,373
|
|
||
Commercial mortgage-backed securities
|
|
618,848
|
|
|
812,886
|
|
||
Collateralized loan and debt obligations
|
|
371,256
|
|
|
405,128
|
|
||
Asset-backed securities
|
|
510,663
|
|
|
507,255
|
|
||
Total fixed maturity investments
|
|
$
|
6,312,821
|
|
|
$
|
5,946,179
|
|
Short-term investments
|
|
408,704
|
|
|
419,796
|
|
||
Total fixed income investments
|
|
$
|
6,721,525
|
|
|
$
|
6,365,975
|
|
Equity securities
|
|
|
|
|
||||
Equity investments
|
|
$
|
500,968
|
|
|
$
|
511,191
|
|
Preferred equity investments
|
|
173
|
|
|
17,623
|
|
||
Total equity securities
|
|
$
|
501,141
|
|
|
$
|
528,814
|
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||
Ratings
(1)
|
|
Fair Value
|
|
Percentage
|
|
Fair Value
|
|
Percentage
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||
U.S. government and agencies securities
|
|
$
|
1,001,882
|
|
|
14.9
|
%
|
|
$
|
818,468
|
|
|
12.9
|
%
|
AAA / Aaa
|
|
3,002,166
|
|
|
44.7
|
%
|
|
1,204,763
|
|
|
18.9
|
%
|
||
AA / Aa
(2)
|
|
720,678
|
|
|
10.7
|
%
|
|
2,237,707
|
|
|
35.1
|
%
|
||
A / A
|
|
1,055,428
|
|
|
15.7
|
%
|
|
1,094,590
|
|
|
17.2
|
%
|
||
BBB
|
|
449,244
|
|
|
6.7
|
%
|
|
703,817
|
|
|
11.1
|
%
|
||
Below BBB
|
|
419,664
|
|
|
6.2
|
%
|
|
268,030
|
|
|
4.2
|
%
|
||
Not rated
|
|
72,463
|
|
|
1.1
|
%
|
|
38,600
|
|
|
0.6
|
%
|
||
Total
|
|
$
|
6,721,525
|
|
|
100.0
|
%
|
|
$
|
6,365,975
|
|
|
100.0
|
%
|
(1)
|
The credit rating for each security reflected above was determined based on the highest rating assigned to the individual security by Standard & Poor's Financial Services LLC ("S&P"), Moody's Investors Service, Inc. ("Moody's"), Fitch Ratings, Inc., or DBRS, Inc.
|
(2)
|
Includes agency mortgage-backed securities of
$1,472.3 million
and
$1,335.7 million
at December 31,
2016
and
2015
, respectively.
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||
|
|
Amortized
Cost
|
|
Fair Value
|
|
Amortized
Cost
|
|
Fair Value
|
||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||
Due within one year
|
|
$
|
617,655
|
|
|
$
|
617,462
|
|
|
$
|
622,070
|
|
|
$
|
622,248
|
|
Due after one year through five years
|
|
2,170,111
|
|
|
2,187,173
|
|
|
2,005,456
|
|
|
1,995,502
|
|
||||
Due after five years through ten years
|
|
887,775
|
|
|
896,388
|
|
|
683,147
|
|
|
676,932
|
|
||||
Due after ten years
|
|
55,400
|
|
|
58,449
|
|
|
33,168
|
|
|
34,651
|
|
||||
Residential mortgage-backed securities
|
|
1,448,917
|
|
|
1,461,286
|
|
|
1,301,083
|
|
|
1,311,373
|
|
||||
Commercial mortgage-backed securities
|
|
615,730
|
|
|
618,848
|
|
|
817,570
|
|
|
812,886
|
|
||||
Collateralized loan and debt obligations
|
|
369,126
|
|
|
371,256
|
|
|
419,795
|
|
|
405,128
|
|
||||
Asset-backed securities
|
|
509,595
|
|
|
510,663
|
|
|
510,540
|
|
|
507,255
|
|
||||
Total
|
|
$
|
6,674,309
|
|
|
$
|
6,721,525
|
|
|
$
|
6,392,829
|
|
|
$
|
6,365,975
|
|
Investment Returns
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Net investment income (loss) from other investments
|
|
$
|
12,442
|
|
|
$
|
(13,553
|
)
|
|
$
|
19,609
|
|
Net investment income from fixed income investments, equity securities and cash and cash equivalents (net of investment expenses)
|
|
164,148
|
|
|
127,379
|
|
|
111,934
|
|
|||
Net investment income included in net income
|
|
176,590
|
|
|
113,826
|
|
|
131,543
|
|
|||
Net realized and unrealized investment (losses) gains included in net income
|
|
(12,419
|
)
|
|
12,660
|
|
|
19,733
|
|
|||
Net impairment losses recognized in earnings
|
|
(10,769
|
)
|
|
(3,715
|
)
|
|
(625
|
)
|
|||
Net increase (decrease) in unrealized gain (loss) included in other comprehensive (loss) income, before deferred tax offsets
|
|
82,925
|
|
|
(104,628
|
)
|
|
44,271
|
|
|||
Total net investment return
|
|
$
|
236,327
|
|
|
$
|
18,143
|
|
|
$
|
194,922
|
|
|
|
Sovereign Exposure
|
|
Non-Sovereign Exposure
|
|
|
|
|
||||||||||||||||||||||||
|
|
|
|
|
|
Corporate securities
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Country
|
|
Foreign
Government
Securities
|
|
Government
Guaranteed
Corporate
Securities
|
|
Financial
|
|
Non-Financial
|
|
Structured
Securities
(1)
|
|
Equity
Securities
|
|
Short-term Investments
|
|
Gross
Exposure
|
||||||||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||||||||||||||
Belgium
|
|
$
|
1,943
|
|
|
$
|
—
|
|
|
$
|
875
|
|
|
$
|
35,340
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
38,158
|
|
Bermuda
|
|
—
|
|
|
—
|
|
|
2,577
|
|
|
—
|
|
|
—
|
|
|
23
|
|
|
—
|
|
|
2,600
|
|
||||||||
Brazil
|
|
—
|
|
|
—
|
|
|
877
|
|
|
616
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,493
|
|
||||||||
Chile
|
|
—
|
|
|
—
|
|
|
3,176
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,176
|
|
||||||||
China
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,268
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,268
|
|
||||||||
Finland
|
|
2,987
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,987
|
|
||||||||
France
|
|
17,691
|
|
|
3,569
|
|
|
24,245
|
|
|
23,672
|
|
|
2,354
|
|
|
—
|
|
|
—
|
|
|
71,531
|
|
||||||||
Germany
|
|
17,758
|
|
|
—
|
|
|
3,989
|
|
|
42,823
|
|
|
—
|
|
|
16,026
|
|
|
—
|
|
|
80,596
|
|
||||||||
Hong Kong
|
|
—
|
|
|
—
|
|
|
—
|
|
|
894
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
894
|
|
||||||||
Ireland
|
|
—
|
|
|
—
|
|
|
1,353
|
|
|
1,090
|
|
|
809
|
|
|
—
|
|
|
—
|
|
|
3,252
|
|
||||||||
Israel
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,947
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,947
|
|
||||||||
Italy
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,472
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,472
|
|
||||||||
Japan
|
|
—
|
|
|
—
|
|
|
25,349
|
|
|
8,546
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,895
|
|
||||||||
Republic of Korea
|
|
7,274
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,274
|
|
||||||||
Luxembourg
|
|
—
|
|
|
—
|
|
|
5,363
|
|
|
3,602
|
|
|
181
|
|
|
48,938
|
|
|
—
|
|
|
58,084
|
|
||||||||
Mexico
|
|
1,367
|
|
|
—
|
|
|
—
|
|
|
1,247
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
2,619
|
|
||||||||
Netherlands
|
|
4,260
|
|
|
—
|
|
|
37,667
|
|
|
13,439
|
|
|
1,395
|
|
|
—
|
|
|
—
|
|
|
56,761
|
|
||||||||
New Zealand
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,033
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,033
|
|
||||||||
Portugal
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
58
|
|
|
—
|
|
|
—
|
|
|
58
|
|
||||||||
Qatar
|
|
—
|
|
|
—
|
|
|
—
|
|
|
539
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
539
|
|
||||||||
Russia
|
|
—
|
|
|
—
|
|
|
1,568
|
|
|
4,655
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,223
|
|
||||||||
Saudi Arabia
|
|
3,314
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,314
|
|
||||||||
Slovenia
|
|
620
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
620
|
|
||||||||
Spain
|
|
—
|
|
|
—
|
|
|
1,191
|
|
|
1,913
|
|
|
647
|
|
|
—
|
|
|
—
|
|
|
3,751
|
|
||||||||
European Supranational
(2)
|
|
6,203
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,203
|
|
||||||||
United Arab Emirates
|
|
—
|
|
|
—
|
|
|
679
|
|
|
765
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,444
|
|
||||||||
United Kingdom
|
|
64,016
|
|
|
347
|
|
|
71,414
|
|
|
65,742
|
|
|
8,734
|
|
|
143,259
|
|
|
14,779
|
|
|
368,291
|
|
||||||||
Virgin Islands (British)
|
|
—
|
|
|
—
|
|
|
266
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
266
|
|
|||||||||
Total
|
|
$
|
127,433
|
|
|
$
|
3,916
|
|
|
$
|
180,589
|
|
|
$
|
214,603
|
|
|
$
|
14,178
|
|
|
$
|
208,251
|
|
|
$
|
14,779
|
|
|
$
|
763,749
|
|
(1)
|
Structured securities includes residential non-agency mortgage-backed securities, commercial non-agency mortgage-backed securities, and asset-backed securities.
|
(2)
|
European Supranational securities are issued by entities formed by two or more central governments to promote economic development for the member countries, such as the World Bank, the European Bank for Reconstruction and Development and the European Investment Bank.
|
Country
|
|
AAA
|
|
AA
|
|
A
|
|
BBB
|
|
Below BBB
|
|
NR and Equity Securities
|
|
Total
|
||||||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||||||||||
Belgium
|
|
$
|
—
|
|
|
$
|
1,943
|
|
|
$
|
34,035
|
|
|
$
|
—
|
|
|
$
|
2,180
|
|
|
$
|
—
|
|
|
$
|
38,158
|
|
Bermuda
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,577
|
|
|
23
|
|
|
2,600
|
|
|||||||
Brazil
|
|
—
|
|
|
—
|
|
|
—
|
|
|
616
|
|
|
877
|
|
|
—
|
|
|
1,493
|
|
|||||||
Chile
|
|
—
|
|
|
3,176
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,176
|
|
|||||||
China
|
|
—
|
|
|
—
|
|
|
1,268
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,268
|
|
|||||||
Finland
|
|
—
|
|
|
2,987
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,987
|
|
|||||||
France
|
|
14,173
|
|
|
16,282
|
|
|
33,494
|
|
|
3,246
|
|
|
3,705
|
|
|
631
|
|
|
71,531
|
|
|||||||
Germany
|
|
17,758
|
|
|
995
|
|
|
43,351
|
|
|
1,872
|
|
|
433
|
|
|
16,187
|
|
|
80,596
|
|
|||||||
Hong Kong
|
|
—
|
|
|
—
|
|
|
635
|
|
|
—
|
|
|
259
|
|
|
—
|
|
|
894
|
|
|||||||
Ireland
|
|
808
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,444
|
|
|
—
|
|
|
3,252
|
|
|||||||
Israel
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,947
|
|
|
—
|
|
|
—
|
|
|
3,947
|
|
|||||||
Italy
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,472
|
|
|
—
|
|
|
—
|
|
|
1,472
|
|
|||||||
Japan
|
|
—
|
|
|
—
|
|
|
33,895
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,895
|
|
|||||||
Republic of Korea
|
|
—
|
|
|
7,274
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,274
|
|
|||||||
Luxembourg
|
|
603
|
|
|
—
|
|
|
—
|
|
|
2,984
|
|
|
3,346
|
|
|
51,151
|
|
|
58,084
|
|
|||||||
Mexico
|
|
—
|
|
|
—
|
|
|
1,243
|
|
|
1,367
|
|
|
—
|
|
|
9
|
|
|
2,619
|
|
|||||||
Netherlands
|
|
8,315
|
|
|
15,878
|
|
|
16,081
|
|
|
9,030
|
|
|
7,081
|
|
|
376
|
|
|
56,761
|
|
|||||||
New Zealand
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,033
|
|
|
—
|
|
|
3,033
|
|
|||||||
Portugal
|
|
—
|
|
|
—
|
|
|
58
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
58
|
|
|||||||
Qatar
|
|
—
|
|
|
539
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
539
|
|
|||||||
Russia
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,923
|
|
|
2,300
|
|
|
—
|
|
|
6,223
|
|
|||||||
Saudi Arabia
|
|
—
|
|
|
3,314
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,314
|
|
|||||||
Slovenia
|
|
—
|
|
|
—
|
|
|
620
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
620
|
|
|||||||
Spain
|
|
318
|
|
|
969
|
|
|
551
|
|
|
1,913
|
|
|
—
|
|
|
—
|
|
|
3,751
|
|
|||||||
European Supranational
|
|
5,101
|
|
|
1,102
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,203
|
|
|||||||
United Arab Emirates
|
|
—
|
|
|
1,444
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,444
|
|
|||||||
United Kingdom
|
|
51,853
|
|
|
76,450
|
|
|
69,070
|
|
|
17,263
|
|
|
9,761
|
|
|
143,894
|
|
|
368,291
|
|
|||||||
Virgin Islands (British)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
266
|
|
|
266
|
|
|||||||
Total
|
|
$
|
98,929
|
|
|
$
|
132,353
|
|
|
$
|
234,301
|
|
|
$
|
47,633
|
|
|
$
|
37,996
|
|
|
$
|
212,537
|
|
|
$
|
763,749
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Net cash provided by operating activities
|
|
$
|
415,492
|
|
|
$
|
245,457
|
|
|
$
|
266,261
|
|
Net cash (used in) provided by investing activities
|
|
(19,222
|
)
|
|
486,793
|
|
|
(236,881
|
)
|
|||
Net cash used in financing activities
|
|
(403,583
|
)
|
|
(274,774
|
)
|
|
(99,738
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
(20,896
|
)
|
|
(25,198
|
)
|
|
(30,021
|
)
|
|||
Net (decrease) increase in cash and cash equivalents
|
|
(28,209
|
)
|
|
432,278
|
|
|
(100,379
|
)
|
|||
Cash and cash equivalents, beginning of year
|
|
1,177,750
|
|
|
745,472
|
|
|
845,851
|
|
|||
Cash and cash equivalents, end of year
|
|
$
|
1,149,541
|
|
|
$
|
1,177,750
|
|
|
$
|
745,472
|
|
|
|
Payments due by period
|
||||||||||||||||||
Contractual Obligations
|
|
Total
|
|
Less than 1
year
|
|
1 - 3 years
|
|
3 - 5 years
|
|
More than 5
years
|
||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||
Reserve for losses and loss expenses
|
|
$
|
4,905,138
|
|
|
$
|
1,720,760
|
|
|
$
|
1,607,684
|
|
|
$
|
737,181
|
|
|
$
|
839,513
|
|
4.7% Senior Notes
|
|
300,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
300,000
|
|
|||||
Interest on 4.7% Senior Notes
|
|
84,600
|
|
|
14,100
|
|
|
28,200
|
|
|
28,200
|
|
|
14,100
|
|
|||||
7% Senior Notes
|
|
335,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
335,000
|
|
|||||
Interest on 7% Senior Notes
|
|
422,100
|
|
|
23,450
|
|
|
46,900
|
|
|
46,900
|
|
|
304,850
|
|
|||||
Trust Preferred Securities
(1)
|
|
100,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
100,000
|
|
|||||
Interest on Trust Preferred Securities
(1)
|
|
98,100
|
|
|
4,905
|
|
|
9,810
|
|
|
9,810
|
|
|
73,575
|
|
|||||
Investment commitments
(2)
|
|
92,214
|
|
|
92,214
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating lease obligations
(3)
|
|
201,862
|
|
|
15,895
|
|
|
42,365
|
|
|
40,159
|
|
|
103,443
|
|
|||||
Total
|
|
$
|
6,539,014
|
|
|
$
|
1,871,324
|
|
|
$
|
1,734,959
|
|
|
$
|
862,250
|
|
|
$
|
2,070,481
|
|
(1)
|
Assumes that the Trust Preferred Securities are redeemed upon their maturity in March 2036, and that the interest rate thereon remains at 4.905% per year, the rate that has been set through the LIBOR swap.
|
(2)
|
The Company entered into investment agreements to invest additional amounts in other investments.
|
(3)
|
The Company leases office space and office equipment under various operating leases.
|
|
|
2016
|
|
2015
|
||||
|
|
(U.S. dollars in thousands)
|
||||||
Senior notes and Trust Preferred Securities
|
|
$
|
705,285
|
|
|
$
|
717,497
|
|
Preferred shares
|
|
230,000
|
|
|
460,000
|
|
||
Common shareholders' equity
|
|
4,652,439
|
|
|
4,396,262
|
|
||
Total capital resources
(1)
|
|
$
|
5,587,724
|
|
|
$
|
5,573,759
|
|
Ratio of debt to total capital resources
|
|
12.6
|
%
|
|
12.9
|
%
|
||
Ratio of debt plus preferred shares to total capital resources
|
|
16.7
|
%
|
|
21.1
|
%
|
(1)
|
The Company also has Credit Facility and LOC Agreements capacity of
$295.5 million
and
$438.4 million
as at December 31,
2016
and
2015
, respectively.
|
|
|
Incurred related to:
|
|
Total incurred
|
||||||||
|
|
Current year
|
|
Prior years
|
|
losses
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Insurance segment:
|
|
|
|
|
|
|
||||||
Agriculture
|
|
$
|
201,002
|
|
|
$
|
(16,569
|
)
|
|
$
|
184,433
|
|
Casualty and other specialty
|
|
191,462
|
|
|
(31,881
|
)
|
|
159,581
|
|
|||
Professional lines
|
|
111,293
|
|
|
205
|
|
|
111,498
|
|
|||
Property, marine/energy and aviation
|
|
257,558
|
|
|
(28,892
|
)
|
|
228,666
|
|
|||
Total Insurance
|
|
761,315
|
|
|
(77,137
|
)
|
|
684,178
|
|
|||
Reinsurance segment:
|
|
|
|
|
|
|
||||||
Catastrophe
|
|
140,696
|
|
|
(32,663
|
)
|
|
108,033
|
|
|||
Property
|
|
166,785
|
|
|
(20,854
|
)
|
|
145,931
|
|
|||
Casualty
|
|
149,674
|
|
|
(20,111
|
)
|
|
129,563
|
|
|||
Professional lines
|
|
150,158
|
|
|
(31,052
|
)
|
|
119,106
|
|
|||
Specialty
|
|
173,974
|
|
|
(39,733
|
)
|
|
134,241
|
|
|||
Total Reinsurance
|
|
781,287
|
|
|
(144,413
|
)
|
|
636,874
|
|
|||
Totals
|
|
$
|
1,542,602
|
|
|
$
|
(221,550
|
)
|
|
$
|
1,321,052
|
|
|
|
Incurred related to:
|
|
Total incurred
|
||||||||
|
|
Current year
|
|
Prior years
|
|
losses
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Insurance segment:
|
|
|
|
|
|
|
||||||
Agriculture
|
|
$
|
241,590
|
|
|
$
|
(1,331
|
)
|
|
$
|
240,259
|
|
Casualty and other specialty
|
|
144,865
|
|
|
(54,594
|
)
|
|
90,271
|
|
|||
Professional lines
|
|
80,166
|
|
|
(194
|
)
|
|
79,972
|
|
|||
Property, marine/energy and aviation
|
|
116,247
|
|
|
(25,882
|
)
|
|
90,365
|
|
|||
Total Insurance
|
|
582,868
|
|
|
(82,001
|
)
|
|
500,867
|
|
|||
Reinsurance segment:
|
|
|
|
|
|
|
||||||
Catastrophe
|
|
45,977
|
|
|
(32,260
|
)
|
|
13,717
|
|
|||
Property
|
|
150,717
|
|
|
(29,364
|
)
|
|
121,353
|
|
|||
Casualty
|
|
114,832
|
|
|
(34,730
|
)
|
|
80,102
|
|
|||
Professional lines
|
|
124,041
|
|
|
(26,108
|
)
|
|
97,933
|
|
|||
Specialty
|
|
142,137
|
|
|
(39,001
|
)
|
|
103,136
|
|
|||
Total Reinsurance
|
|
577,704
|
|
|
(161,463
|
)
|
|
416,241
|
|
|||
Totals
|
|
$
|
1,160,572
|
|
|
$
|
(243,464
|
)
|
|
$
|
917,108
|
|
|
|
Case
Reserves
|
|
IBNR Reserves
|
|
Reserve for
Losses and Loss
Expenses
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Insurance segment:
|
|
|
|
|
|
|
||||||
Agriculture
|
|
$
|
195,981
|
|
|
$
|
51,906
|
|
|
$
|
247,887
|
|
Casualty and other specialty
|
|
299,684
|
|
|
1,072,560
|
|
|
1,372,244
|
|
|||
Professional lines
|
|
155,631
|
|
|
555,743
|
|
|
711,374
|
|
|||
Property, marine/energy and aviation
|
|
295,430
|
|
|
172,054
|
|
|
467,484
|
|
|||
Total Insurance
|
|
946,726
|
|
|
1,852,263
|
|
|
2,798,989
|
|
|||
Reinsurance segment:
|
|
|
|
|
|
|
||||||
Catastrophe
|
|
150,408
|
|
|
59,436
|
|
|
209,844
|
|
|||
Property
|
|
220,223
|
|
|
100,122
|
|
|
320,345
|
|
|||
Casualty
|
|
233,374
|
|
|
499,459
|
|
|
732,833
|
|
|||
Professional lines
|
|
87,138
|
|
|
338,034
|
|
|
425,172
|
|
|||
Specialty
|
|
153,581
|
|
|
264,374
|
|
|
417,955
|
|
|||
Total Reinsurance
|
|
844,724
|
|
|
1,261,425
|
|
|
2,106,149
|
|
|||
Totals
|
|
$
|
1,791,450
|
|
|
$
|
3,113,688
|
|
|
$
|
4,905,138
|
|
|
|
Case
Reserves
|
|
IBNR Reserves
|
|
Reserve for
Losses and Loss
Expenses
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Insurance segment:
|
|
|
|
|
|
|
||||||
Agriculture
|
|
$
|
226,753
|
|
|
$
|
57,799
|
|
|
$
|
284,552
|
|
Casualty and other specialty
|
|
267,877
|
|
|
1,010,083
|
|
|
1,277,960
|
|
|||
Professional lines
|
|
116,920
|
|
|
464,638
|
|
|
581,558
|
|
|||
Property, marine/energy and aviation
|
|
226,894
|
|
|
122,930
|
|
|
349,824
|
|
|||
Total Insurance
|
|
838,444
|
|
|
1,655,450
|
|
|
2,493,894
|
|
|||
Reinsurance segment:
|
|
|
|
|
|
|
||||||
Catastrophe
|
|
109,374
|
|
|
80,851
|
|
|
190,225
|
|
|||
Property
|
|
229,283
|
|
|
112,026
|
|
|
341,309
|
|
|||
Casualty
|
|
247,802
|
|
|
524,917
|
|
|
772,719
|
|
|||
Professional lines
|
|
70,301
|
|
|
285,692
|
|
|
355,993
|
|
|||
Specialty
|
|
142,217
|
|
|
214,058
|
|
|
356,275
|
|
|||
Total Reinsurance
|
|
798,977
|
|
|
1,217,544
|
|
|
2,016,521
|
|
|||
Totals
|
|
$
|
1,637,421
|
|
|
$
|
2,872,994
|
|
|
$
|
4,510,415
|
|
|
|
Quarter Ended
March 31, 2016 |
|
Quarter Ended
June 30, 2016 |
|
Quarter Ended
September 30, 2016 |
|
Quarter Ended
December 31, 2016 |
|
Year Ended December 31, 2016
|
||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||
Incurred related to:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current year
|
|
$
|
304,437
|
|
|
$
|
434,747
|
|
|
$
|
385,714
|
|
|
$
|
417,704
|
|
|
$
|
1,542,602
|
|
Prior years
|
|
(61,109
|
)
|
|
(58,635
|
)
|
|
(54,252
|
)
|
|
(47,554
|
)
|
|
(221,550
|
)
|
|||||
Total incurred
|
|
$
|
243,328
|
|
|
$
|
376,112
|
|
|
$
|
331,462
|
|
|
$
|
370,150
|
|
|
$
|
1,321,052
|
|
Paid related to:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current year
|
|
$
|
(7,051
|
)
|
|
$
|
(46,513
|
)
|
|
$
|
(92,862
|
)
|
|
$
|
(149,436
|
)
|
|
$
|
(295,862
|
)
|
Prior years
|
|
(333,227
|
)
|
|
(207,596
|
)
|
|
(177,027
|
)
|
|
(172,178
|
)
|
|
(890,028
|
)
|
|||||
Total paid
|
|
$
|
(340,278
|
)
|
|
$
|
(254,109
|
)
|
|
$
|
(269,889
|
)
|
|
$
|
(321,614
|
)
|
|
$
|
(1,185,890
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
Quarter Ended
March 31, 2015 |
|
Quarter Ended
June 30, 2015 |
|
Quarter Ended
September 30, 2015 |
|
Quarter Ended
December 31, 2015 |
|
Year Ended December 31, 2015
|
||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||
Incurred related to:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current year
|
|
$
|
229,094
|
|
|
$
|
297,958
|
|
|
$
|
331,340
|
|
|
$
|
302,180
|
|
|
$
|
1,160,572
|
|
Prior years
|
|
(57,158
|
)
|
|
(58,836
|
)
|
|
(67,347
|
)
|
|
(60,123
|
)
|
|
(243,464
|
)
|
|||||
Total incurred
|
|
$
|
171,936
|
|
|
$
|
239,122
|
|
|
$
|
263,993
|
|
|
$
|
242,057
|
|
|
$
|
917,108
|
|
Paid related to:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current year
|
|
$
|
1,971
|
|
|
$
|
(27,807
|
)
|
|
$
|
(113,105
|
)
|
|
$
|
(126,958
|
)
|
|
$
|
(265,899
|
)
|
Prior years
|
|
(304,617
|
)
|
|
(196,734
|
)
|
|
(202,858
|
)
|
|
(163,530
|
)
|
|
(867,739
|
)
|
|||||
Total paid
|
|
$
|
(302,646
|
)
|
|
$
|
(224,541
|
)
|
|
$
|
(315,963
|
)
|
|
$
|
(290,488
|
)
|
|
$
|
(1,133,638
|
)
|
(1)
|
Reporting pattern changes are not applicable to the agricultural business as it is typically settled at an established time each year.
|
Rating
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
|
|
(U.S. dollars in thousands)
|
||||||
U.S. Government sponsored program
|
|
$
|
141,443
|
|
|
$
|
234,596
|
|
A+ and above
|
|
889,814
|
|
|
458,255
|
|
||
A
|
|
397,691
|
|
|
476,184
|
|
||
A-
|
|
5,805
|
|
|
7,060
|
|
||
Not rated
|
|
52,165
|
|
|
19,875
|
|
||
Total
|
|
$
|
1,486,918
|
|
|
$
|
1,195,970
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
Current income tax expense
|
|
$
|
(10,993
|
)
|
|
$
|
(6,262
|
)
|
|
$
|
(1,804
|
)
|
Deferred income tax benefit (expense)
|
|
11,174
|
|
|
1,900
|
|
|
1,414
|
|
|||
Income tax benefit (expense)
|
|
$
|
181
|
|
|
$
|
(4,362
|
)
|
|
$
|
(390
|
)
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(U.S. dollars in thousands)
|
||||||||||
U.S. (domestic)
|
|
$
|
40,872
|
|
|
$
|
95,649
|
|
|
$
|
60,112
|
|
Non-U.S. (foreign)
|
|
340,094
|
|
|
263,824
|
|
|
288,728
|
|
|||
Pre-tax income
|
|
$
|
380,966
|
|
|
$
|
359,473
|
|
|
$
|
348,840
|
|
|
|
Interest Rate Shift in Basis Points
|
||||||||||||||||||
December 31, 2016
|
|
(100)
|
|
(50)
|
|
—
|
|
50
|
|
100
|
||||||||||
|
|
(U.S. dollars in millions)
|
||||||||||||||||||
Total fair value
|
|
$
|
8,073.5
|
|
|
$
|
7,974.8
|
|
|
$
|
7,871.1
|
|
|
$
|
7,764.3
|
|
|
$
|
7,657.5
|
|
Market value change from base
|
|
2.57
|
%
|
|
1.32
|
%
|
|
—
|
|
|
(1.36
|
)%
|
|
(2.71
|
)%
|
|||||
Change in unrealized value
|
|
$
|
202.4
|
|
|
$
|
103.7
|
|
|
$
|
—
|
|
|
$
|
(106.8
|
)
|
|
$
|
(213.6
|
)
|
|
|
Interest Rate Shift in Basis Points
|
||||||||||||||||||
December 31, 2015
|
|
(100)
|
|
(50)
|
|
—
|
|
50
|
|
100
|
||||||||||
|
|
(U.S. dollars in millions)
|
||||||||||||||||||
Total fair value
|
|
$
|
7,725.1
|
|
|
$
|
7,635.6
|
|
|
$
|
7,543.7
|
|
|
$
|
7,450.5
|
|
|
$
|
7,356.5
|
|
Market value change from base
|
|
2.40
|
%
|
|
1.22
|
%
|
|
—
|
|
|
(1.24
|
)%
|
|
(2.48
|
)%
|
|||||
Change in unrealized value
|
|
$
|
181.4
|
|
|
$
|
91.9
|
|
|
$
|
—
|
|
|
$
|
(93.2
|
)
|
|
$
|
(187.2
|
)
|
|
|
Credit Spread Shift in Basis Points
|
||||||||||||||||||
December 31, 2016
|
|
(100)
|
|
(50)
|
|
—
|
|
50
|
|
100
|
||||||||||
|
|
(U.S. dollars in millions)
|
||||||||||||||||||
Total fair value
|
|
$
|
8,029.9
|
|
|
$
|
7,950.8
|
|
|
$
|
7,871.1
|
|
|
$
|
7,791.3
|
|
|
$
|
7,712.2
|
|
Market value change from base
|
|
2.02
|
%
|
|
1.01
|
%
|
|
—
|
|
|
(1.01
|
)%
|
|
(2.02
|
)%
|
|||||
Change in unrealized value
|
|
$
|
158.8
|
|
|
$
|
79.7
|
|
|
$
|
—
|
|
|
$
|
(79.8
|
)
|
|
$
|
(158.9
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
Credit Spread Shift in Basis Points
|
||||||||||||||||||
December 31, 2015
|
|
(100)
|
|
(50)
|
|
—
|
|
50
|
|
100
|
||||||||||
|
|
(U.S. dollars in millions)
|
||||||||||||||||||
Total fair value
|
|
$
|
7,662.7
|
|
|
$
|
7,603.2
|
|
|
$
|
7,543.7
|
|
|
$
|
7,484.2
|
|
|
$
|
7,425.4
|
|
Market value change from base
|
|
1.58
|
%
|
|
0.79
|
%
|
|
—
|
|
|
(0.79
|
)%
|
|
(1.57
|
)%
|
|||||
Change in unrealized value
|
|
$
|
119.0
|
|
|
$
|
59.5
|
|
|
$
|
—
|
|
|
$
|
(59.5
|
)
|
|
$
|
(118.3
|
)
|
December 31, 2016
|
|
Due within
one year
|
|
Due after one
year through
five years
|
|
Due after five
years through
ten years
|
|
Due after ten
years
|
|
Mortgage-
backed
securities
(1)
|
|
Collateralized
loan and debt obligations |
|
Asset- backed
securities
(1)
|
|
Total
|
||||||||||||||||
Ratings
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||||||||||||||
U.S. government and agencies securities
|
|
$
|
17,282
|
|
|
$
|
707,027
|
|
|
$
|
272,064
|
|
|
$
|
5,509
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,001,882
|
|
AAA / Aaa
|
|
319,928
|
|
|
145,890
|
|
|
24,585
|
|
|
8,233
|
|
|
1,915,233
|
|
|
192,543
|
|
|
395,754
|
|
|
3,002,166
|
|
||||||||
AA / Aa
|
|
168,450
|
|
|
310,088
|
|
|
98,584
|
|
|
7,904
|
|
|
38,862
|
|
|
40,574
|
|
|
56,216
|
|
|
720,678
|
|
||||||||
A / A
|
|
82,679
|
|
|
667,321
|
|
|
203,065
|
|
|
16,301
|
|
|
29,745
|
|
|
20,492
|
|
|
35,825
|
|
|
1,055,428
|
|
||||||||
BBB
|
|
18,167
|
|
|
201,676
|
|
|
97,754
|
|
|
14,507
|
|
|
42,257
|
|
|
69,474
|
|
|
5,409
|
|
|
449,244
|
|
||||||||
Below BBB
|
|
8,835
|
|
|
127,645
|
|
|
180,386
|
|
|
5,995
|
|
|
45,335
|
|
|
42,096
|
|
|
9,372
|
|
|
419,664
|
|
||||||||
Not rated
|
|
2,121
|
|
|
27,526
|
|
|
19,950
|
|
|
—
|
|
|
8,702
|
|
|
6,077
|
|
|
8,087
|
|
|
72,463
|
|
||||||||
Total
|
|
$
|
617,462
|
|
|
$
|
2,187,173
|
|
|
$
|
896,388
|
|
|
$
|
58,449
|
|
|
$
|
2,080,134
|
|
|
$
|
371,256
|
|
|
$
|
510,663
|
|
|
$
|
6,721,525
|
|
December 31, 2015
|
|
Due within
one year
|
|
Due after one
year through
five years
|
|
Due after five
years through
ten years
|
|
Due after ten
years
|
|
Mortgage-
backed
securities
(1)
|
|
Collateralized
loan and debt
obligations
|
|
Asset- backed
securities
(1)
|
|
Total
|
||||||||||||||||
Ratings
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||||||||||||||
U.S. government and agencies securities
|
|
$
|
72,824
|
|
|
$
|
410,529
|
|
|
$
|
327,070
|
|
|
$
|
8,045
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
818,468
|
|
AAA / Aaa
|
|
72,501
|
|
|
128,799
|
|
|
35,249
|
|
|
135
|
|
|
440,748
|
|
|
194,320
|
|
|
333,011
|
|
|
1,204,763
|
|
||||||||
AA / Aa
|
|
363,702
|
|
|
247,936
|
|
|
30,605
|
|
|
6,310
|
|
|
1,460,324
|
|
|
47,782
|
|
|
81,048
|
|
|
2,237,707
|
|
||||||||
A / A
|
|
71,233
|
|
|
692,496
|
|
|
115,706
|
|
|
14,870
|
|
|
112,886
|
|
|
22,186
|
|
|
65,213
|
|
|
1,094,590
|
|
||||||||
BBB
|
|
37,058
|
|
|
438,252
|
|
|
114,044
|
|
|
2,072
|
|
|
46,858
|
|
|
59,577
|
|
|
5,956
|
|
|
703,817
|
|
||||||||
Below BBB
|
|
4,893
|
|
|
61,219
|
|
|
53,491
|
|
|
3,014
|
|
|
49,867
|
|
|
80,231
|
|
|
15,315
|
|
|
268,030
|
|
||||||||
Not rated
|
|
37
|
|
|
16,271
|
|
|
767
|
|
|
205
|
|
|
13,576
|
|
|
1,032
|
|
|
6,712
|
|
|
38,600
|
|
||||||||
Total
|
|
$
|
622,248
|
|
|
$
|
1,995,502
|
|
|
$
|
676,932
|
|
|
$
|
34,651
|
|
|
$
|
2,124,259
|
|
|
$
|
405,128
|
|
|
$
|
507,255
|
|
|
$
|
6,365,975
|
|
(1)
|
The effective durations of the Company's mortgage-backed and asset-backed securities portfolios were
3.57
and
1.70
, respectively, as of December 31,
2015
. These securities are subject to prepayment risk and as such, actual maturity may differ significantly from contract maturity.
|
Rating
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
|
|
(U.S. dollars in thousands)
|
||||||
U.S. Government sponsored program
|
|
$
|
141,443
|
|
|
$
|
234,596
|
|
A+ and above
|
|
889,814
|
|
|
458,255
|
|
||
A
|
|
397,691
|
|
|
476,184
|
|
||
A-
|
|
5,805
|
|
|
7,060
|
|
||
Not rated
|
|
52,165
|
|
|
19,875
|
|
||
Total
|
|
$
|
1,486,918
|
|
|
$
|
1,195,970
|
|
|
|
20%
decrease
|
|
%
change
|
|
10%
decrease
|
|
%
change
|
|
December 31, 2016
|
|
10%
increase
|
|
%
change
|
|
20%
increase
|
|
%
change
|
||||||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||||||||||||||
Equities
|
|
$
|
(48,180
|
)
|
|
(9.61
|
)%
|
|
$
|
(24,090
|
)
|
|
(4.81
|
)%
|
|
$
|
501,141
|
|
|
$
|
24,090
|
|
|
4.81
|
%
|
|
$
|
48,180
|
|
|
9.61
|
%
|
Total invested assets
(1)
|
|
$
|
(48,180
|
)
|
|
(0.55
|
)%
|
|
$
|
(24,090
|
)
|
|
(0.27
|
)%
|
|
$
|
8,833,798
|
|
|
$
|
24,090
|
|
|
0.27
|
%
|
|
$
|
48,180
|
|
|
0.55
|
%
|
Shareholders' equity
|
|
$
|
(48,180
|
)
|
|
(0.99
|
)%
|
|
$
|
(24,090
|
)
|
|
(0.49
|
)%
|
|
$
|
4,882,439
|
|
|
$
|
24,090
|
|
|
0.49
|
%
|
|
$
|
48,180
|
|
|
0.99
|
%
|
(1)
|
Includes total investments and cash and cash equivalents, net of investments pending settlement.
|
|
|
20%
decrease
|
|
%
change
|
|
10%
decrease
|
|
%
change
|
|
December 31, 2015
|
|
10%
increase
|
|
%
change
|
|
20%
increase
|
|
%
change
|
||||||||||||||
|
|
(U.S. dollars in thousands)
|
||||||||||||||||||||||||||||||
Equities
|
|
$
|
(65,503
|
)
|
|
(12.39
|
)%
|
|
$
|
(32,751
|
)
|
|
(6.19
|
)%
|
|
$
|
528,814
|
|
|
$
|
32,751
|
|
|
6.19
|
%
|
|
$
|
65,503
|
|
|
12.39
|
%
|
Total invested assets
(1)
|
|
$
|
(65,503
|
)
|
|
(0.73
|
)%
|
|
$
|
(32,751
|
)
|
|
(0.37
|
)%
|
|
$
|
8,913,587
|
|
|
$
|
32,751
|
|
|
0.37
|
%
|
|
$
|
65,503
|
|
|
0.73
|
%
|
Shareholders' equity
|
|
$
|
(65,503
|
)
|
|
(1.35
|
)%
|
|
$
|
(32,751
|
)
|
|
(0.67
|
)%
|
|
$
|
4,856,262
|
|
|
$
|
32,751
|
|
|
0.67
|
%
|
|
$
|
65,503
|
|
|
1.35
|
%
|
(1)
|
Includes total investments and cash and cash equivalents, net of investments pending settlement.
|
/s/ Ernst & Young Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
/s/ Ernst & Young Ltd.
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
ASSETS
|
|
|
|
|
||||
Investments
|
|
|
|
|
||||
Fixed maturity investments, trading at fair value (amortized cost: $2,727,271 and $1,611,079 at December 31, 2016 and 2015, respectively)
|
|
$
|
2,740,055
|
|
|
$
|
1,587,160
|
|
Fixed maturity investments, available for sale at fair value (amortized cost: $3,538,227 and $4,361,997 at December 31, 2016 and 2015, respectively)
|
|
3,572,766
|
|
|
4,359,019
|
|
||
Short-term investments, trading at fair value (amortized cost: $330,305 and $394,096 at December 31, 2016 and 2015, respectively)
|
|
330,199
|
|
|
394,111
|
|
||
Short-term investments, available for sale at fair value (amortized cost: $78,506 and $25,657 at December 31, 2016 and 2015, respectively)
|
|
78,505
|
|
|
25,685
|
|
||
Equity securities, trading at fair value (cost: $16,094 and $15,290 at December 31, 2016 and 2015, respectively)
|
|
16,056
|
|
|
15,229
|
|
||
Equity securities, available for sale at fair value (cost: $461,684 and $542,429 at December 31, 2016 and 2015, respectively)
|
|
485,085
|
|
|
513,585
|
|
||
Other investments
|
|
588,308
|
|
|
872,617
|
|
||
Total investments
|
|
7,810,974
|
|
|
7,767,406
|
|
||
Cash and cash equivalents
|
|
1,149,541
|
|
|
1,177,750
|
|
||
Premiums receivable, net
|
|
1,657,752
|
|
|
1,376,328
|
|
||
Insurance and reinsurance balances receivable
|
|
110,183
|
|
|
102,403
|
|
||
Deferred acquisition costs
|
|
276,639
|
|
|
255,501
|
|
||
Prepaid reinsurance premiums
|
|
711,695
|
|
|
498,574
|
|
||
Reinsurance recoverable on unpaid losses
|
|
1,213,129
|
|
|
907,944
|
|
||
Reinsurance recoverable on paid losses
|
|
273,789
|
|
|
288,026
|
|
||
Accrued investment income
|
|
35,853
|
|
|
30,213
|
|
||
Goodwill and intangible assets
|
|
468,374
|
|
|
553,960
|
|
||
Deferred tax asset
|
|
71,802
|
|
|
64,164
|
|
||
Net receivable on sales of investments
|
|
54,620
|
|
|
31,873
|
|
||
Other assets
|
|
288,510
|
|
|
187,383
|
|
||
Total assets
|
|
$
|
14,122,861
|
|
|
$
|
13,241,525
|
|
LIABILITIES
|
|
|
|
|
||||
Reserve for losses and loss expenses
|
|
$
|
4,905,138
|
|
|
$
|
4,510,415
|
|
Reserve for unearned premiums
|
|
1,994,676
|
|
|
1,789,148
|
|
||
Deposit liabilities
|
|
14,013
|
|
|
13,674
|
|
||
Reinsurance balances payable
|
|
784,162
|
|
|
661,213
|
|
||
Debt
|
|
705,292
|
|
|
717,650
|
|
||
Net payable on purchases of investments
|
|
181,337
|
|
|
63,442
|
|
||
Deferred tax liability
|
|
13,074
|
|
|
17,315
|
|
||
Other liabilities
|
|
383,036
|
|
|
344,596
|
|
||
Total liabilities
|
|
8,980,728
|
|
|
8,117,453
|
|
||
Commitments and contingent liabilities
|
|
|
|
|
||||
SHAREHOLDERS' EQUITY
|
|
|
|
|
||||
Preferred shares, total liquidation preference $230,000 (2015 - $460,000)
|
|
9
|
|
|
9,209
|
|
||
Common shares, ordinary - 67,627,901 issued and outstanding (2015 - 66,797,991)
|
|
67,628
|
|
|
66,798
|
|
||
Additional paid-in capital
|
|
1,961,917
|
|
|
2,145,836
|
|
||
Accumulated other comprehensive loss
|
|
(58,749
|
)
|
|
(46,634
|
)
|
||
Retained earnings
|
|
2,911,634
|
|
|
2,681,053
|
|
||
Total shareholders' equity available to Endurance Holdings
|
|
4,882,439
|
|
|
4,856,262
|
|
||
Non-controlling interests
|
|
259,694
|
|
|
267,810
|
|
||
Total shareholders' equity
|
|
5,142,133
|
|
|
5,124,072
|
|
||
Total liabilities and shareholders' equity
|
|
$
|
14,122,861
|
|
|
$
|
13,241,525
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Revenues
|
|
|
|
|
|
|
||||||
Gross premiums written
|
|
$
|
4,202,170
|
|
|
$
|
3,320,861
|
|
|
$
|
2,894,076
|
|
Ceded premiums written
|
|
(1,832,235
|
)
|
|
(1,370,391
|
)
|
|
(959,870
|
)
|
|||
Net premiums written
|
|
2,369,935
|
|
|
1,950,470
|
|
|
1,934,206
|
|
|||
Change in unearned premiums
|
|
(6,275
|
)
|
|
27,983
|
|
|
(70,228
|
)
|
|||
Net premiums earned
|
|
2,363,660
|
|
|
1,978,453
|
|
|
1,863,978
|
|
|||
Net investment income
|
|
176,590
|
|
|
113,826
|
|
|
131,543
|
|
|||
Net realized and unrealized (losses) gains
|
|
(12,419
|
)
|
|
12,660
|
|
|
14,283
|
|
|||
Net impairment losses recognized in earnings
|
|
(10,769
|
)
|
|
(3,715
|
)
|
|
(625
|
)
|
|||
Other underwriting loss
|
|
(909
|
)
|
|
(3,694
|
)
|
|
(5,786
|
)
|
|||
Total revenues
|
|
2,516,153
|
|
|
2,097,530
|
|
|
2,003,393
|
|
|||
Expenses
|
|
|
|
|
|
|
||||||
Net losses and loss expenses
|
|
1,321,052
|
|
|
917,108
|
|
|
970,162
|
|
|||
Acquisition expenses
|
|
460,483
|
|
|
347,885
|
|
|
319,513
|
|
|||
General and administrative expenses
|
|
248,146
|
|
|
259,791
|
|
|
247,387
|
|
|||
Corporate expenses
|
|
51,706
|
|
|
114,429
|
|
|
66,200
|
|
|||
Amortization of intangibles
|
|
84,624
|
|
|
30,620
|
|
|
6,484
|
|
|||
Net foreign exchange (gains) losses
|
|
(74,684
|
)
|
|
26,964
|
|
|
3,839
|
|
|||
Interest expense
|
|
43,860
|
|
|
41,260
|
|
|
40,968
|
|
|||
Total expenses
|
|
2,135,187
|
|
|
1,738,057
|
|
|
1,654,553
|
|
|||
Income before income taxes
|
|
380,966
|
|
|
359,473
|
|
|
348,840
|
|
|||
Income tax benefit (expense)
|
|
181
|
|
|
(4,362
|
)
|
|
(390
|
)
|
|||
Net income
|
|
381,147
|
|
|
355,111
|
|
|
348,450
|
|
|||
Net income attributable to non-controlling interests
|
|
(24,130
|
)
|
|
(11,016
|
)
|
|
—
|
|
|||
Net income available to Endurance Holdings
|
|
357,017
|
|
|
344,095
|
|
|
348,450
|
|
|||
Preferred dividends
|
|
(23,799
|
)
|
|
(32,750
|
)
|
|
(32,750
|
)
|
|||
Net income available to Endurance Holdings' common and participating common shareholders
|
|
$
|
333,218
|
|
|
$
|
311,345
|
|
|
$
|
315,700
|
|
Comprehensive income
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
381,147
|
|
|
$
|
355,111
|
|
|
$
|
348,450
|
|
Other comprehensive (loss) income
|
|
|
|
|
|
|
||||||
Net unrealized holding gains (losses) on investments arising during the period (net of other-than-temporary impairment losses recognized in other comprehensive (loss) income, reclassification adjustment and applicable deferred income tax (expense) benefit in 2016 - ($8,804); 2015 - $5,890; 2014 - ($4,121))
|
|
74,121
|
|
|
(98,738
|
)
|
|
40,150
|
|
|||
Foreign currency translation adjustments
|
|
(86,324
|
)
|
|
(24,690
|
)
|
|
(26,264
|
)
|
|||
Reclassification adjustment for net losses on derivatives designated as cash flow hedge included in net income
|
|
88
|
|
|
88
|
|
|
89
|
|
|||
Other comprehensive (loss) income
|
|
(12,115
|
)
|
|
(123,340
|
)
|
|
13,975
|
|
|||
Comprehensive income
|
|
369,032
|
|
|
231,771
|
|
|
362,425
|
|
|||
Comprehensive income attributable to non-controlling interests
|
|
(24,130
|
)
|
|
(11,016
|
)
|
|
—
|
|
|||
Comprehensive income attributable to Endurance Holdings common and participating common shareholders
|
|
$
|
344,902
|
|
|
$
|
220,755
|
|
|
$
|
362,425
|
|
Per share data
|
|
|
|
|
|
|
||||||
Basic earnings per common share
|
|
$
|
4.94
|
|
|
$
|
5.74
|
|
|
$
|
7.07
|
|
Diluted earnings per common share
|
|
$
|
4.93
|
|
|
$
|
5.73
|
|
|
$
|
7.06
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Preferred shares
|
|
|
|
|
|
|
||||||
Balance, beginning of year
|
|
$
|
9,209
|
|
|
$
|
17,200
|
|
|
$
|
17,200
|
|
Issuance of Series C, non-cumulative preferred shares
|
|
—
|
|
|
9
|
|
|
—
|
|
|||
Redemption of Series A and B, non-cumulative preferred shares
|
|
(9,200
|
)
|
|
(8,000
|
)
|
|
—
|
|
|||
Balance, end of year
|
|
9
|
|
|
9,209
|
|
|
17,200
|
|
|||
Common shares
|
|
|
|
|
|
|
||||||
Balance, beginning of year
|
|
66,798
|
|
|
44,765
|
|
|
44,369
|
|
|||
Issuance of common shares, net of forfeitures
|
|
830
|
|
|
22,033
|
|
|
396
|
|
|||
Balance, end of year
|
|
67,628
|
|
|
66,798
|
|
|
44,765
|
|
|||
Additional paid-in capital
|
|
|
|
|
|
|
||||||
Balance, beginning of year
|
|
2,145,836
|
|
|
598,226
|
|
|
569,116
|
|
|||
Issuance of common shares, net of forfeitures
|
|
11,135
|
|
|
1,476,615
|
|
|
2,143
|
|
|||
Issuance of Series C, non-cumulative preferred shares
|
|
—
|
|
|
222,954
|
|
|
—
|
|
|||
Public offering and registration costs
|
|
—
|
|
|
(936
|
)
|
|
—
|
|
|||
Redemption of Series A and B, non-cumulative preferred shares
|
|
(219,767
|
)
|
|
(192,000
|
)
|
|
—
|
|
|||
Settlement of equity awards
|
|
(11,732
|
)
|
|
(14,535
|
)
|
|
(4,039
|
)
|
|||
Stock-based compensation expense
|
|
36,445
|
|
|
55,512
|
|
|
31,006
|
|
|||
Balance, end of year
|
|
1,961,917
|
|
|
2,145,836
|
|
|
598,226
|
|
|||
Accumulated other comprehensive (loss) income
|
|
|
|
|
|
|
||||||
Cumulative foreign currency translation adjustments:
|
|
|
|
|
|
|
||||||
Balance, beginning of year
|
|
(32,318
|
)
|
|
(7,628
|
)
|
|
18,636
|
|
|||
Foreign currency translation adjustments
|
|
(86,324
|
)
|
|
(24,690
|
)
|
|
(26,264
|
)
|
|||
Balance, end of year
|
|
(118,642
|
)
|
|
(32,318
|
)
|
|
(7,628
|
)
|
|||
Unrealized holding gains (losses) on investments, net of deferred taxes:
|
|
|
|
|
|
|
||||||
Balance, beginning of year
|
|
(12,638
|
)
|
|
86,100
|
|
|
45,950
|
|
|||
Net unrealized holding gains (losses) arising during the year, net of other-than-temporary impairment losses and reclassification adjustment
|
|
74,121
|
|
|
(98,738
|
)
|
|
40,150
|
|
|||
Balance, end of year
|
|
61,483
|
|
|
(12,638
|
)
|
|
86,100
|
|
|||
Accumulated derivative loss on cash flow hedging instruments:
|
|
|
|
|
|
|
||||||
Balance, beginning of year
|
|
(1,678
|
)
|
|
(1,766
|
)
|
|
(1,855
|
)
|
|||
Net change from current period hedging transactions, net of reclassification adjustment
|
|
88
|
|
|
88
|
|
|
89
|
|
|||
Balance, end of year
|
|
(1,590
|
)
|
|
(1,678
|
)
|
|
(1,766
|
)
|
|||
Total accumulated other comprehensive (loss) income
|
|
(58,749
|
)
|
|
(46,634
|
)
|
|
76,706
|
|
|||
Retained earnings
|
|
|
|
|
|
|
||||||
Balance, beginning of year
|
|
2,681,053
|
|
|
2,448,285
|
|
|
2,193,133
|
|
|||
Net income
|
|
381,147
|
|
|
355,111
|
|
|
348,450
|
|
|||
Net income attributable to non-controlling interests
|
|
(24,130
|
)
|
|
(11,016
|
)
|
|
—
|
|
|||
Dividends on preferred shares
|
|
(23,799
|
)
|
|
(32,750
|
)
|
|
(32,750
|
)
|
|||
Dividends on common shares
|
|
(102,637
|
)
|
|
(78,577
|
)
|
|
(60,548
|
)
|
|||
Balance, end of year
|
|
2,911,634
|
|
|
2,681,053
|
|
|
2,448,285
|
|
|||
Total shareholders' equity available to Endurance Holdings
|
|
4,882,439
|
|
|
4,856,262
|
|
|
3,185,182
|
|
|||
Non-controlling interests
|
|
259,694
|
|
|
267,810
|
|
|
—
|
|
|||
Total shareholders' equity
|
|
$
|
5,142,133
|
|
|
$
|
5,124,072
|
|
|
$
|
3,185,182
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Cash flows provided by operating activities:
|
|
|
||||||||||
Net income
|
|
$
|
381,147
|
|
|
$
|
355,111
|
|
|
$
|
348,450
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||||||
Amortization of net premium on investments
|
|
33,285
|
|
|
45,317
|
|
|
45,757
|
|
|||
Amortization of other intangibles and depreciation
|
|
105,026
|
|
|
51,457
|
|
|
27,234
|
|
|||
Net realized and unrealized losses (gains)
|
|
12,419
|
|
|
(12,660
|
)
|
|
(14,283
|
)
|
|||
Net impairment losses recognized in earnings
|
|
10,769
|
|
|
3,715
|
|
|
625
|
|
|||
Deferred taxes
|
|
(19,709
|
)
|
|
(2,727
|
)
|
|
(1,414
|
)
|
|||
Stock-based compensation expense
|
|
36,445
|
|
|
55,512
|
|
|
31,006
|
|
|||
Equity in earnings of other investments
|
|
(12,442
|
)
|
|
13,553
|
|
|
(19,609
|
)
|
|||
Premiums receivable, net
|
|
(281,424
|
)
|
|
(153,735
|
)
|
|
(214,252
|
)
|
|||
Insurance and reinsurance balances receivable
|
|
(7,780
|
)
|
|
33,729
|
|
|
5,508
|
|
|||
Deferred acquisition costs
|
|
(21,138
|
)
|
|
(48,133
|
)
|
|
(21,341
|
)
|
|||
Prepaid reinsurance premiums
|
|
(213,121
|
)
|
|
(74,944
|
)
|
|
(167,731
|
)
|
|||
Reinsurance recoverable on unpaid losses
|
|
(305,185
|
)
|
|
(197,097
|
)
|
|
(77,040
|
)
|
|||
Reinsurance recoverable on paid losses
|
|
14,237
|
|
|
(61,748
|
)
|
|
(54,071
|
)
|
|||
Accrued investment income
|
|
(5,640
|
)
|
|
5,840
|
|
|
(3,079
|
)
|
|||
Other assets
|
|
(6,855
|
)
|
|
(25,683
|
)
|
|
(17,132
|
)
|
|||
Reserve for losses and loss expenses
|
|
394,723
|
|
|
(57,375
|
)
|
|
(155,400
|
)
|
|||
Reserve for unearned premiums
|
|
205,528
|
|
|
36,036
|
|
|
235,668
|
|
|||
Deposit liabilities
|
|
339
|
|
|
(1,462
|
)
|
|
(4,322
|
)
|
|||
Reinsurance balances payable
|
|
122,949
|
|
|
204,557
|
|
|
194,650
|
|
|||
Other liabilities
|
|
(28,081
|
)
|
|
76,194
|
|
|
127,037
|
|
|||
Net cash flows provided by operating activities
|
|
415,492
|
|
|
245,457
|
|
|
266,261
|
|
|||
Cash flows (used in) provided by investing activities
|
|
|
|
|
|
|
||||||
Proceeds from sales and maturities of trading investments
|
|
3,115,204
|
|
|
626,914
|
|
|
—
|
|
|||
Proceeds from sales and maturities of available for sale investments
|
|
3,477,688
|
|
|
5,725,794
|
|
|
4,145,940
|
|
|||
Proceeds from the redemption of other investments
|
|
355,325
|
|
|
188,060
|
|
|
154,655
|
|
|||
Purchases of trading investments
|
|
(4,091,588
|
)
|
|
(1,080,478
|
)
|
|
—
|
|
|||
Purchases of available for sale investments
|
|
(2,752,599
|
)
|
|
(5,421,949
|
)
|
|
(4,449,225
|
)
|
|||
Purchases of other investments
|
|
(58,222
|
)
|
|
(221,457
|
)
|
|
(59,023
|
)
|
|||
Net (purchases) settlements of other assets
|
|
(47,450
|
)
|
|
21,273
|
|
|
11,665
|
|
|||
Purchases of fixed assets
|
|
(17,568
|
)
|
|
(26,988
|
)
|
|
(40,932
|
)
|
|||
Net cash (paid for) received from subsidiary acquisition
|
|
(12
|
)
|
|
675,624
|
|
|
39
|
|
|||
Net cash flows (used in) provided by investing activities
|
|
(19,222
|
)
|
|
486,793
|
|
|
(236,881
|
)
|
|||
Cash flows used in financing activities
|
|
|
|
|
|
|
||||||
Issuance of common shares
|
|
10,076
|
|
|
24,823
|
|
|
2,305
|
|
|||
Issuance of Series C, non-cumulative preferred shares
|
|
—
|
|
|
222,963
|
|
|
—
|
|
|||
Redemption of Series A and B, non-cumulative preferred shares
|
|
(230,000
|
)
|
|
(200,000
|
)
|
|
—
|
|
|||
Settlement of equity awards
|
|
(11,732
|
)
|
|
(14,535
|
)
|
|
(4,039
|
)
|
|||
Net distributions to non-controlling interests
|
|
(32,246
|
)
|
|
(1,739
|
)
|
|
—
|
|
|||
Offering and registration costs paid
|
|
(319
|
)
|
|
(617
|
)
|
|
—
|
|
|||
Proceeds from issuance of repurchase agreements
|
|
120,990
|
|
|
—
|
|
|
—
|
|
|||
Repayment of repurchase agreements
|
|
(120,990
|
)
|
|
—
|
|
|
—
|
|
|||
Bridge facility costs paid
|
|
—
|
|
|
—
|
|
|
(4,750
|
)
|
|||
Proceeds from issuance of debt
|
|
537
|
|
|
5,008
|
|
|
706
|
|
|||
Repayments of debt
|
|
(13,683
|
)
|
|
(199,454
|
)
|
|
(686
|
)
|
|||
Dividends on preferred shares
|
|
(23,799
|
)
|
|
(32,750
|
)
|
|
(32,750
|
)
|
|||
Dividends on common shares
|
|
(102,417
|
)
|
|
(78,473
|
)
|
|
(60,524
|
)
|
|||
Net cash flows used in financing activities
|
|
(403,583
|
)
|
|
(274,774
|
)
|
|
(99,738
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
(20,896
|
)
|
|
(25,198
|
)
|
|
(30,021
|
)
|
|||
Net (decrease) increase in cash and cash equivalents
|
|
(28,209
|
)
|
|
432,278
|
|
|
(100,379
|
)
|
|||
Cash and cash equivalents, beginning of year
|
|
1,177,750
|
|
|
745,472
|
|
|
845,851
|
|
|||
Cash and cash equivalents, end of year
|
|
$
|
1,149,541
|
|
|
$
|
1,177,750
|
|
|
$
|
745,472
|
|
Operating Subsidiaries
|
|
Domicile
|
Endurance Specialty Insurance Ltd. ("Endurance Bermuda")
|
|
Bermuda
|
Blue Capital Management Ltd., manager of Blue Water Re Ltd. and Blue Water Re II Ltd.
|
|
Bermuda
|
Endurance Worldwide Insurance Limited ("Endurance U.K.")
|
|
England
|
Endurance at Lloyd's, managing agent for Lloyd's Syndicate 5151
|
|
England
|
Endurance Assurance Corporation ("Endurance Assurance", formerly Endurance Reinsurance Corporation of America)
|
|
Delaware
|
Endurance American Insurance Company ("Endurance American")
|
|
Delaware
|
Endurance American Specialty Insurance Company ("Endurance American Specialty")
|
|
Delaware
|
Endurance Risk Solutions Assurance Co. ("Endurance Risk Solutions")
|
|
Delaware
|
American Agri-Business Insurance Company ("American Agri-Business"), managed by ARMtech Insurance Services, Inc. (together with American Agri-Business, "ARMtech")
|
|
Texas
|
(a)
|
Premiums and related expenses
|
(b)
|
Reserve for losses and loss expenses
|
(c)
|
Reinsurance
|
(d)
|
Investments
|
(d)
|
Investments, cont'd.
|
(e)
|
Cash equivalents and short-term investments
|
(g)
|
Offering and registration costs
|
(h)
|
Foreign exchange
|
(i)
|
Derivatives
|
(j)
|
Income taxes
|
(k)
|
Stock compensation and other stock plans
|
(l)
|
Earnings per share
|
(m)
|
Use of estimates
|
(n)
|
Variable interest entity
|
(o)
|
Non-controlling interests
|
(p)
|
Reclassifications
|
2.
|
Significant accounting policies, cont'd.
|
Consideration paid by Endurance Holdings
|
|
|
||
Number of Montpelier common shares outstanding immediately prior to the closing of the acquisition
|
|
43,827,753
|
|
|
Exchange ratio
|
|
0.472
|
|
|
Total Company ordinary shares
|
|
20,686,699
|
|
|
Company ordinary share closing price on July 31, 2015
|
|
$
|
69.49
|
|
Total value of Company ordinary shares
|
|
$
|
1,437,519
|
|
Fair value of restricted share units attributable to service period prior to Closing Date
(1)
|
|
$
|
33,327
|
|
Total consideration
|
|
$
|
1,470,846
|
|
|
|
|
||
Special Dividend paid by Montpelier
|
|
|
||
Number of Montpelier common shares and restricted share units eligible for special dividend
|
|
45,611,810
|
|
|
Special dividend paid per Montpelier common share and restricted share unit
|
|
$
|
9.89
|
|
Total special dividend consideration paid to Montpelier common shareholders and Montpelier equity award holders
|
|
$
|
451,101
|
|
|
|
|
||
Total consideration received by Montpelier common shareholders and Montpelier equity award holders
|
|
$
|
1,921,947
|
|
Less: Special Dividend paid by Montpelier
|
|
(451,101
|
)
|
|
Net purchase price
|
|
$
|
1,470,846
|
|
Montpelier shareholders' equity attributable to controlling interest prior to Special Dividend
|
|
$
|
1,560,255
|
|
Cash and cash equivalents (Special Dividend on Montpelier common shares and Montpelier equity awards)
|
|
(451,101
|
)
|
|
Adjusted shareholders' equity of Montpelier as of July 31, 2015
|
|
1,109,154
|
|
|
Adjustments for fair value, by applicable balance sheet caption:
|
|
|
||
Assets:
|
|
|
||
Fixed maturity investments, trading at fair value
|
|
(11,100
|
)
|
|
Deferred acquisition costs
|
|
(91,713
|
)
|
|
Reinsurance recoverable on unpaid losses
|
|
(675
|
)
|
|
Other assets
|
|
(12,459
|
)
|
|
Liabilities:
|
|
|
||
Reserve for losses and loss expenses
|
|
10,822
|
|
|
Debt
|
|
21,123
|
|
|
Deferred tax liability
|
|
(18,346
|
)
|
|
Equity:
|
|
|
||
Non-controlling interest
|
|
25,615
|
|
|
Total adjustments for fair value by applicable balance sheet caption
|
|
(76,733
|
)
|
|
Adjustments for fair value of the identifiable intangible assets:
|
|
|
||
Identifiable indefinite lived intangible assets (insurance licenses, Lloyd's syndicate capacity and asset management agreements)
|
|
57,600
|
|
|
Identifiable finite lived intangible assets (non-contractual relationships, Lloyd's syndicate distribution channel, renewal rights, value of business acquired ("VOBA"), trade names, non-compete agreements and asset management agreements)
|
|
293,200
|
|
|
Total adjustments for fair value by applicable balance sheet caption and identifiable intangible assets
|
|
274,067
|
|
|
Estimated fair value of net assets acquired and identifiable intangible assets
|
|
1,383,221
|
|
|
Total consideration paid by Endurance Holdings
|
|
1,470,846
|
|
|
Estimated total consideration over the fair value of net assets acquired assigned to goodwill
|
|
$
|
87,625
|
|
•
|
Fixed maturity investments, trading at fair value - To reflect certain investments at fair value;
|
•
|
Deferred acquisition costs - To eliminate Montpelier's deferred acquisition costs;
|
•
|
Other assets - To eliminate deferred debt issuance costs related to Montpelier's existing senior notes and to write off Montpelier's fixed assets and goodwill;
|
•
|
Reserve for losses and loss expenses - To reflect a decrease in net losses and loss expenses due to the addition of a market based risk margin, which represents the cost of capital required by a market participant to assume the net losses and loss expenses of Montpelier, offset by a deduction that represents the discount due to the present value calculation of the unpaid losses and loss expenses based on the expected payout of the net unpaid losses and loss expenses;
|
•
|
Debt - To reflect Montpelier's existing senior notes and trust preferred securities at fair value using indicative market pricing obtained from third-party service providers;
|
•
|
Deferred tax liability - To reflect the deferred tax liability on identifiable intangible assets;
|
•
|
Non-controlling interest - To reflect Montpelier's non-controlling interest at fair value; and
|
•
|
Identifiable indefinite lived and finite lived intangible assets - To establish the fair value of identifiable intangible assets related to the acquisition of Montpelier described in detail below.
|
|
|
Amount
|
|
Economic Useful Life
|
||
Key non-contractual relationships
|
|
$
|
71,800
|
|
|
10
|
Other non-contractual relationships
|
|
22,400
|
|
|
3
|
|
Trade names
|
|
1,800
|
|
|
Various
|
|
Insurance licenses
|
|
1,900
|
|
|
Indefinite
|
|
Non-compete agreements
|
|
5,700
|
|
|
Various
|
|
Lloyd's syndicate capacity
|
|
48,300
|
|
|
Indefinite
|
|
Lloyd's syndicate distribution channel
|
|
18,400
|
|
|
10
|
|
Renewal rights
|
|
82,100
|
|
|
15
|
|
VOBA
|
|
88,400
|
|
|
2
|
|
Asset management agreements
|
|
10,000
|
|
|
Various
|
|
Identifiable intangible assets at July 31, 2015
|
|
$
|
350,800
|
|
|
|
•
|
Key non-contractual relationships - these relationships included Montpelier's top brokers and consideration was given to the expectation of the renewal of these relationships and the associated expenses;
|
•
|
Other non-contractual relationships - these relationships consisted of Montpelier's brokers with the exception of those top brokers previously listed above as key non-contractual relationships and consideration was given to the expectation of the renewal of these relationships and the associated expenses;
|
•
|
Trade names - represents the value of the Montpelier and Blue Capital brands acquired;
|
•
|
Insurance licenses - the value of insurance licenses acquired providing the ability to write reinsurance in
15
states of the U.S.;
|
•
|
Non-compete agreements - represent non-compete agreements with key employees of Montpelier;
|
•
|
Lloyd's syndicate capacity - the value of Lloyd's syndicate capacity, which represents Montpelier's authorized premium income limit to write insurance business in the Lloyd's marketplace;
|
•
|
Lloyd's syndicate distribution channel - the value of sales of insurance policies that result directly from relationships between Lloyd's and the brokers in the Lloyd's marketplace;
|
•
|
Renewal rights - the value of policy renewal rights taking into consideration written premium on assumed retention ratios and the insurance cash flows and the associated equity cash flows from these renewal policies over the expected life of the renewals;
|
•
|
VOBA - the expected future losses and expenses associated with the policies that were in-force as of the Closing Date of the transaction were estimated and compared to the future premium remaining expected to be earned. The difference between the risk-adjusted future loss and expenses, discounted to present value and the unearned premium reserve, was estimated to be the VOBA; and
|
•
|
Asset management contracts - represents the value of the Blue Capital asset management contracts acquired.
|
|
|
For the period from July 31, 2015 to December 31, 2015
|
||
Total revenues
|
|
$
|
225,899
|
|
Net income attributable to the Company's common shareholders
(1)
|
|
54,768
|
|
|
|
Year Ended December 31,
|
||||||
|
|
2015
|
|
2014
|
||||
Total revenues
|
|
$
|
2,452,410
|
|
|
$
|
2,668,604
|
|
Net income available to Endurance Holdings' common shareholders
|
|
443,817
|
|
|
388,371
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Fixed income investments
|
|
$
|
165,210
|
|
|
$
|
132,786
|
|
|
$
|
118,084
|
|
Equity securities
|
|
12,639
|
|
|
8,209
|
|
|
5,689
|
|
|||
Other investments
|
|
12,442
|
|
|
(13,553
|
)
|
|
19,609
|
|
|||
Cash and cash equivalents
|
|
2,824
|
|
|
2,870
|
|
|
2,445
|
|
|||
|
|
$
|
193,115
|
|
|
$
|
130,312
|
|
|
$
|
145,827
|
|
Investment expenses
|
|
(16,525
|
)
|
|
(16,486
|
)
|
|
(14,284
|
)
|
|||
Net investment income
|
|
$
|
176,590
|
|
|
$
|
113,826
|
|
|
$
|
131,543
|
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||
|
|
Amortized
Cost
|
|
Fair Value
|
|
Amortized
Cost
|
|
Fair Value
|
||||||||
Due within one year
|
|
$
|
617,655
|
|
|
$
|
617,462
|
|
|
$
|
622,070
|
|
|
$
|
622,248
|
|
Due after one year through five years
|
|
2,170,111
|
|
|
2,187,173
|
|
|
2,005,456
|
|
|
1,995,502
|
|
||||
Due after five years through ten years
|
|
887,775
|
|
|
896,388
|
|
|
683,147
|
|
|
676,932
|
|
||||
Due after ten years
|
|
55,400
|
|
|
58,449
|
|
|
33,168
|
|
|
34,651
|
|
||||
Residential mortgage-backed securities
|
|
1,448,917
|
|
|
1,461,286
|
|
|
1,301,083
|
|
|
1,311,373
|
|
||||
Commercial mortgage-backed securities
|
|
615,730
|
|
|
618,848
|
|
|
817,570
|
|
|
812,886
|
|
||||
Collateralized loan and debt obligations
|
|
369,126
|
|
|
371,256
|
|
|
419,795
|
|
|
405,128
|
|
||||
Asset-backed securities
|
|
509,595
|
|
|
510,663
|
|
|
510,540
|
|
|
507,255
|
|
||||
Total
|
|
$
|
6,674,309
|
|
|
$
|
6,721,525
|
|
|
$
|
6,392,829
|
|
|
$
|
6,365,975
|
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
Fixed maturity investments
|
|
|
|
|
||||
U.S. government and agencies securities
|
|
$
|
551,055
|
|
|
$
|
319,674
|
|
U.S. state and municipal securities
|
|
6,006
|
|
|
5,559
|
|
||
Foreign government securities
|
|
110,088
|
|
|
49,861
|
|
||
Government guaranteed corporate securities
|
|
2,959
|
|
|
38,201
|
|
||
Corporate securities
|
|
1,051,200
|
|
|
532,192
|
|
||
Residential mortgage-backed securities
|
|
483,444
|
|
|
258,574
|
|
||
Commercial mortgage-backed securities
|
|
164,237
|
|
|
127,124
|
|
||
Collateralized loan and debt obligations
|
|
98,924
|
|
|
103,219
|
|
||
Asset-backed securities
|
|
272,142
|
|
|
152,756
|
|
||
Total fixed maturity investments
|
|
2,740,055
|
|
|
1,587,160
|
|
||
Short-term investments
|
|
330,199
|
|
|
394,111
|
|
||
Total fixed income investments
|
|
$
|
3,070,254
|
|
|
$
|
1,981,271
|
|
Equity securities
|
|
|
|
|
||||
Equity investments
|
|
$
|
16,056
|
|
|
$
|
14,676
|
|
Preferred equity investments
|
|
—
|
|
|
553
|
|
||
Total equity securities
|
|
$
|
16,056
|
|
|
$
|
15,229
|
|
December 31, 2016
|
|
Market Value
|
|
Unfunded
Commitments
|
|
Ineligible for
Redemption in 2017
|
||||||
Alternative funds
|
|
|
|
|
|
|
||||||
Hedge funds
|
|
$
|
482,865
|
|
|
$
|
—
|
|
|
$
|
85,963
|
|
Private investment funds
|
|
76,451
|
|
|
92,214
|
|
|
76,451
|
|
|||
Other investment funds
|
|
28,992
|
|
|
—
|
|
|
27,518
|
|
|||
Total alternative funds
|
|
588,308
|
|
|
92,214
|
|
|
189,932
|
|
|||
Total other investments
|
|
$
|
588,308
|
|
|
$
|
92,214
|
|
|
$
|
189,932
|
|
December 31, 2015
|
|
Market Value
|
|
Unfunded
Commitments
|
|
Ineligible for
Redemption in 2016
|
||||||
Alternative funds
|
|
|
|
|
|
|
||||||
Hedge funds
|
|
$
|
704,966
|
|
|
$
|
—
|
|
|
$
|
57,876
|
|
Private investment funds
|
|
80,690
|
|
|
102,070
|
|
|
80,690
|
|
|||
Other investment funds
|
|
23,465
|
|
|
—
|
|
|
24,958
|
|
|||
Total alternative funds
|
|
809,121
|
|
|
102,070
|
|
|
163,524
|
|
|||
|
|
|
|
|
|
|
||||||
Specialty funds
|
|
|
|
|
|
|
||||||
High yield loan funds
|
|
63,496
|
|
|
—
|
|
|
—
|
|
|||
Total specialty funds
|
|
63,496
|
|
|
—
|
|
|
—
|
|
|||
Total other investments
|
|
$
|
872,617
|
|
|
$
|
102,070
|
|
|
$
|
163,524
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Gross realized gains on investment sales
|
|
$
|
39,033
|
|
|
$
|
65,881
|
|
|
$
|
35,921
|
|
Gross realized losses on investment sales
|
|
(61,752
|
)
|
|
(28,636
|
)
|
|
(16,515
|
)
|
|||
Net unrealized gains (losses) on trading securities
|
|
12,480
|
|
|
(24,257
|
)
|
|
—
|
|
|||
Intangible asset impairment loss
(1)
|
|
—
|
|
|
—
|
|
|
(5,450
|
)
|
|||
Change in fair value of derivative financial instruments
(2)
|
|
(2,180
|
)
|
|
(328
|
)
|
|
327
|
|
|||
Net realized and unrealized (losses) gains
|
|
$
|
(12,419
|
)
|
|
$
|
12,660
|
|
|
$
|
14,283
|
|
(1)
|
For additional information on the Company's intangible assets, see Note 11, Goodwill and intangible assets.
|
(2)
|
For additional information on the Company's derivative financial instruments, see Note 9, Derivatives.
|
December 31, 2016
|
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
||||||||
Fixed maturity investments
|
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies securities
|
|
$
|
449,638
|
|
|
$
|
3,981
|
|
|
$
|
(2,792
|
)
|
|
$
|
450,827
|
|
U.S. state and municipal securities
|
|
11,560
|
|
|
945
|
|
|
(154
|
)
|
|
12,351
|
|
||||
Foreign government securities
|
|
68,539
|
|
|
2,236
|
|
|
(1,944
|
)
|
|
68,831
|
|
||||
Government guaranteed corporate securities
|
|
912
|
|
|
46
|
|
|
—
|
|
|
958
|
|
||||
Corporate securities
|
|
1,078,756
|
|
|
26,481
|
|
|
(8,744
|
)
|
|
1,096,493
|
|
||||
Residential mortgage-backed securities
|
|
968,273
|
|
|
21,032
|
|
|
(11,463
|
)
|
|
977,842
|
|
||||
Commercial mortgage-backed securities
|
|
452,011
|
|
|
8,790
|
|
|
(6,190
|
)
|
|
454,611
|
|
||||
Collateralized loan and debt obligations
|
|
271,361
|
|
|
1,644
|
|
|
(673
|
)
|
|
272,332
|
|
||||
Asset-backed securities
|
|
237,177
|
|
|
2,242
|
|
|
(898
|
)
|
|
238,521
|
|
||||
Total fixed maturity investments
|
|
$
|
3,538,227
|
|
|
$
|
67,397
|
|
|
$
|
(32,858
|
)
|
|
$
|
3,572,766
|
|
Short-term investments
|
|
78,506
|
|
|
1
|
|
|
(2
|
)
|
|
78,505
|
|
||||
Total fixed income investments
|
|
$
|
3,616,733
|
|
|
$
|
67,398
|
|
|
$
|
(32,860
|
)
|
|
$
|
3,651,271
|
|
Equity securities
|
|
|
||||||||||||||
Equity investments
|
|
$
|
461,509
|
|
|
$
|
27,948
|
|
|
$
|
(4,545
|
)
|
|
$
|
484,912
|
|
Preferred equity investments
|
|
175
|
|
|
—
|
|
|
(2
|
)
|
|
173
|
|
||||
Total equity securities
|
|
$
|
461,684
|
|
|
$
|
27,948
|
|
|
$
|
(4,547
|
)
|
|
$
|
485,085
|
|
December 31, 2015
|
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
||||||||
Fixed maturity investments
|
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies securities
|
|
$
|
499,386
|
|
|
$
|
2,561
|
|
|
$
|
(3,153
|
)
|
|
$
|
498,794
|
|
U.S. state and municipal securities
|
|
16,908
|
|
|
120
|
|
|
(181
|
)
|
|
16,847
|
|
||||
Foreign government securities
|
|
110,893
|
|
|
803
|
|
|
(581
|
)
|
|
111,115
|
|
||||
Government guaranteed corporate securities
|
|
19,248
|
|
|
311
|
|
|
(7
|
)
|
|
19,552
|
|
||||
Corporate securities
|
|
1,323,276
|
|
|
5,698
|
|
|
(11,232
|
)
|
|
1,317,742
|
|
||||
Residential mortgage-backed securities
|
|
1,041,540
|
|
|
16,400
|
|
|
(5,141
|
)
|
|
1,052,799
|
|
||||
Commercial mortgage-backed securities
|
|
689,078
|
|
|
4,737
|
|
|
(8,053
|
)
|
|
685,762
|
|
||||
Collateralized loan and debt obligations
|
|
304,915
|
|
|
796
|
|
|
(3,802
|
)
|
|
301,909
|
|
||||
Asset-backed securities
|
|
356,753
|
|
|
585
|
|
|
(2,839
|
)
|
|
354,499
|
|
||||
Total fixed maturity investments
|
|
$
|
4,361,997
|
|
|
$
|
32,011
|
|
|
$
|
(34,989
|
)
|
|
$
|
4,359,019
|
|
Short-term investments
|
|
25,657
|
|
|
28
|
|
|
—
|
|
|
25,685
|
|
||||
Total fixed income investments
|
|
$
|
4,387,654
|
|
|
$
|
32,039
|
|
|
$
|
(34,989
|
)
|
|
$
|
4,384,704
|
|
Equity securities
|
|
|
||||||||||||||
Equity investments
|
|
$
|
527,154
|
|
|
$
|
6,835
|
|
|
$
|
(37,474
|
)
|
|
$
|
496,515
|
|
Preferred equity investments
|
|
15,275
|
|
|
1,946
|
|
|
(151
|
)
|
|
17,070
|
|
||||
Total equity securities
|
|
$
|
542,429
|
|
|
$
|
8,781
|
|
|
$
|
(37,625
|
)
|
|
$
|
513,585
|
|
(1)
|
Gross unrealized losses include unrealized losses on non-OTTI and non-credit OTTI securities recognized in accumulated other comprehensive loss at
December 31, 2016
.
|
|
|
Less than 12 months
|
|
12 months or greater
|
|
Total
|
||||||||||||||||||
December 31, 2015
|
|
Unrealized
Losses
(1)
|
|
Fair
Value
|
|
Unrealized
Losses
(1)
|
|
Fair
Value
|
|
Unrealized
Losses
(1)
|
|
Fair
Value
|
||||||||||||
Fixed maturity investments
|
|
|
|
|
|
|
|
|
||||||||||||||||
U.S. government and agencies securities
|
|
$
|
(2,175
|
)
|
|
$
|
347,024
|
|
|
$
|
(978
|
)
|
|
$
|
16,669
|
|
|
$
|
(3,153
|
)
|
|
$
|
363,693
|
|
U.S. state and municipal securities
|
|
(96
|
)
|
|
9,662
|
|
|
(85
|
)
|
|
695
|
|
|
(181
|
)
|
|
10,357
|
|
||||||
Foreign government securities
|
|
(404
|
)
|
|
31,881
|
|
|
(177
|
)
|
|
3,966
|
|
|
(581
|
)
|
|
35,847
|
|
||||||
Government guaranteed corporate securities
|
|
(7
|
)
|
|
1,692
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
1,692
|
|
||||||
Corporate securities
|
|
(9,222
|
)
|
|
830,349
|
|
|
(2,010
|
)
|
|
51,024
|
|
|
(11,232
|
)
|
|
881,373
|
|
||||||
Residential mortgage-backed securities
|
|
(3,378
|
)
|
|
365,082
|
|
|
(1,763
|
)
|
|
79,355
|
|
|
(5,141
|
)
|
|
444,437
|
|
||||||
Commercial mortgage-backed securities
|
|
(6,708
|
)
|
|
436,387
|
|
|
(1,345
|
)
|
|
42,246
|
|
|
(8,053
|
)
|
|
478,633
|
|
||||||
Collateralized loan and debt obligations
|
|
(3,107
|
)
|
|
224,520
|
|
|
(695
|
)
|
|
48,167
|
|
|
(3,802
|
)
|
|
272,687
|
|
||||||
Asset-backed securities
|
|
(2,624
|
)
|
|
311,814
|
|
|
(215
|
)
|
|
12,880
|
|
|
(2,839
|
)
|
|
324,694
|
|
||||||
Total fixed income investments
|
|
$
|
(27,721
|
)
|
|
$
|
2,558,411
|
|
|
$
|
(7,268
|
)
|
|
$
|
255,002
|
|
|
$
|
(34,989
|
)
|
|
$
|
2,813,413
|
|
Equity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Equity investments
|
|
$
|
(32,021
|
)
|
|
$
|
329,280
|
|
|
$
|
(5,453
|
)
|
|
$
|
56,421
|
|
|
$
|
(37,474
|
)
|
|
$
|
385,701
|
|
Preferred equity investments
|
|
(151
|
)
|
|
7,361
|
|
|
—
|
|
|
—
|
|
|
(151
|
)
|
|
7,361
|
|
||||||
Total equity securities
|
|
$
|
(32,172
|
)
|
|
$
|
336,641
|
|
|
$
|
(5,453
|
)
|
|
$
|
56,421
|
|
|
$
|
(37,625
|
)
|
|
$
|
393,062
|
|
(1)
|
Gross unrealized losses include unrealized losses on non-OTTI and non-credit OTTI securities recognized in accumulated other comprehensive loss at
December 31, 2015
.
|
|
Year Ended
December 31, 2016
|
|
Five Months Ended December 31, 2015
|
||||
Non-controlling interests, beginning balance
|
$
|
267,810
|
|
|
$
|
258,529
|
|
Income attributable to third-party investments in the BCGR Cell
|
14,577
|
|
|
5,526
|
|
||
Income attributable to third-party investments in BCRH
|
9,553
|
|
|
5,490
|
|
||
Net income attributable to non-controlling interests
|
24,130
|
|
|
11,016
|
|
||
Net preferred share redemption attributable to third-party investments in the BCGR Cell
(1)
|
(19,799
|
)
|
|
—
|
|
||
Net investments attributable to third-parties in BCRH
|
72
|
|
|
20
|
|
||
Net change in third-party investments in non-controlling interests
|
(19,727
|
)
|
|
20
|
|
||
Dividends declared by BCRH attributable to non-controlling interests
|
(12,519
|
)
|
|
(1,755
|
)
|
||
Non-controlling interests - ending balance
|
$
|
259,694
|
|
|
$
|
267,810
|
|
•
|
Government and agencies fixed maturity securities – These securities are generally priced by pricing services or index providers. The pricing services or index providers may use current market trades for securities with similar quality, maturity and coupon. If no such trades are available, the pricing service typically uses analytical models which may incorporate option adjusted spreads, daily interest rate data and market/sector news. The Company generally classifies the fair values of government and agencies securities in Level 2. Current issue U.S. government securities are generally valued based on Level 1 inputs, which use the market approach valuation technique.
|
•
|
Government guaranteed corporate fixed maturity securities – These securities are generally priced by pricing services or index providers. The pricing service or index providers may use current market trades for securities with similar quality, maturity and coupon. If no such trades are available, the pricing service typically uses analytical spread models which may incorporate inputs from the U.S. treasury curve or LIBOR. The Company generally classifies the fair values of its government guaranteed corporate securities in Level 2.
|
•
|
Corporate fixed maturity securities – These securities are generally priced by pricing services or index providers. The pricing services or index providers typically use discounted cash flow models that incorporate benchmark curves for treasury, swap and high issuance credits. Credit spreads are developed from current market observations for like or similar securities. The Company generally classifies the fair values of its corporate securities in Level 2.
|
•
|
Equity securities – These securities are generally priced by pricing services or index providers. Depending on the type of underlying equity security or equity fund, the securities are priced by pricing services or index providers based on quoted market prices in active markets or through a discounted cash flow model that incorporates benchmark curves for treasury, swap and credit for like or similar securities. The Company generally classifies the fair values of its equity securities in Level 1 or 2.
|
•
|
Structured securities including agency and non-agency, residential and commercial mortgage, asset-backed securities and collateralized loan and debt obligations – These securities are generally priced by broker/dealers. Broker/dealers may use current market trades for securities with similar qualities. If no such trades are available, inputs such as bid and offer, prepayment speeds, the U.S. treasury curve, swap curve and cash settlement may be used in a discounted cash flow model to determine the fair value of a security. The Company generally classifies the fair values of its structured securities in Level 2.
|
•
|
Other assets and liabilities – A portion of other assets and liabilities are composed of a variety of derivative instruments used to enhance the efficiency of the investment portfolio and economically hedge certain risks. These instruments are generally priced by pricing services, broker/dealers and/or recent trading activity. The market value approach valuation technique is used to estimate the fair value for these derivatives based on significant observable market inputs. Certain derivative instruments are priced by pricing services based on quoted market prices in active markets. These derivative instruments are generally classified in Level 1. Other derivative instruments are priced using industry valuation models and are considered Level 2, as the inputs to the valuation model are based on observable market inputs. Also included in this line item are proprietary, non-exchange traded derivative-based risk management products primarily used to address weather and energy risks. The trading market for these weather derivatives are generally linked to energy and agriculture commodities, weather and other natural phenomena. In instances where market prices are not available, the Company uses industry or internally developed valuation techniques such as spread option, Black Scholes, quanto and simulation modeling to determine fair value and classifies these in Level 3. These models may reference prices for similar instruments.
|
•
|
Debt – Outstanding debt consists of the Company's
7%
Senior Notes due July 15, 2034 and
4.7%
Senior Notes due October 15, 2022 (the "Senior Notes") and the Trust Preferred Securities. The fair values of these securities were obtained from a third party pricing service and pricing was based on the spread above the risk-free yield curve. These spreads are generally obtained from the new issue market, secondary trading and broker-dealer quotes. As these spreads and the yields for the risk-free yield curve are observable market inputs, the fair values of the Senior Notes and the Trust Preferred Securities are classified in Level 2.
|
|
|
|
|
Fair Value Measurements at December 31, 2016
|
||||||||||||
|
|
Total at December 31, 2016
|
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity investments
|
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies securities
|
|
$
|
1,001,882
|
|
|
$
|
51,827
|
|
|
$
|
950,055
|
|
|
$
|
—
|
|
U.S. state and municipal securities
|
|
18,357
|
|
|
—
|
|
|
18,357
|
|
|
—
|
|
||||
Foreign government securities
|
|
178,919
|
|
|
—
|
|
|
178,919
|
|
|
—
|
|
||||
Government guaranteed corporate securities
|
|
3,917
|
|
|
—
|
|
|
3,917
|
|
|
—
|
|
||||
Corporate securities
|
|
2,147,693
|
|
|
—
|
|
|
1,968,056
|
|
|
179,637
|
|
||||
Residential mortgage-backed securities
|
|
1,461,286
|
|
|
—
|
|
|
1,461,286
|
|
|
—
|
|
||||
Commercial mortgage-backed securities
|
|
618,848
|
|
|
—
|
|
|
618,848
|
|
|
—
|
|
||||
Collateralized loan and debt obligations
|
|
371,256
|
|
|
—
|
|
|
371,256
|
|
|
—
|
|
||||
Asset-backed securities
|
|
510,663
|
|
|
—
|
|
|
510,663
|
|
|
—
|
|
||||
Total fixed maturity investments
|
|
6,312,821
|
|
|
51,827
|
|
|
6,081,357
|
|
|
179,637
|
|
||||
Equity securities
|
|
|
|
|
|
|
|
|
||||||||
Equity investments
|
|
500,968
|
|
|
184,251
|
|
|
316,717
|
|
|
—
|
|
||||
Preferred equity investments
|
|
173
|
|
|
—
|
|
|
173
|
|
|
—
|
|
||||
Total equity securities
|
|
501,141
|
|
|
184,251
|
|
|
316,890
|
|
|
—
|
|
||||
Short-term investments
|
|
408,704
|
|
|
—
|
|
|
408,654
|
|
|
50
|
|
||||
Other assets (see Note 9)
|
|
166,716
|
|
|
1,953
|
|
|
123,681
|
|
|
41,082
|
|
||||
Total assets
|
|
$
|
7,389,382
|
|
|
$
|
238,031
|
|
|
$
|
6,930,582
|
|
|
$
|
220,769
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Other liabilities (see Note 9)
|
|
$
|
84,069
|
|
|
$
|
2,772
|
|
|
$
|
55,051
|
|
|
$
|
26,246
|
|
Debt
|
|
770,704
|
|
|
—
|
|
|
770,704
|
|
|
—
|
|
||||
Total liabilities
|
|
$
|
854,773
|
|
|
$
|
2,772
|
|
|
$
|
825,755
|
|
|
$
|
26,246
|
|
|
|
|
|
Fair Value Measurements at December 31, 2015
|
||||||||||||
|
|
Total at December 31, 2015
|
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity investments
|
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies securities
|
|
$
|
818,468
|
|
|
$
|
37,741
|
|
|
$
|
780,727
|
|
|
$
|
—
|
|
U.S. state and municipal securities
|
|
22,406
|
|
|
—
|
|
|
22,406
|
|
|
—
|
|
||||
Foreign government securities
|
|
160,976
|
|
|
—
|
|
|
160,976
|
|
|
—
|
|
||||
Government guaranteed corporate securities
|
|
57,753
|
|
|
—
|
|
|
57,753
|
|
|
—
|
|
||||
Corporate securities
|
|
1,849,934
|
|
|
—
|
|
|
1,739,002
|
|
|
110,932
|
|
||||
Residential mortgage-backed securities
|
|
1,311,373
|
|
|
—
|
|
|
1,311,373
|
|
|
—
|
|
||||
Commercial mortgage-backed securities
|
|
812,886
|
|
|
—
|
|
|
812,174
|
|
|
712
|
|
||||
Collateralized loan and debt obligations
|
|
405,128
|
|
|
—
|
|
|
404,319
|
|
|
809
|
|
||||
Asset-backed securities
|
|
507,255
|
|
|
—
|
|
|
507,255
|
|
|
—
|
|
||||
Total fixed maturity investments
|
|
$
|
5,946,179
|
|
|
$
|
37,741
|
|
|
$
|
5,795,985
|
|
|
$
|
112,453
|
|
Equity securities
|
|
|
|
|
|
|
|
|
||||||||
Equity investments
|
|
511,191
|
|
|
275,086
|
|
|
236,105
|
|
|
—
|
|
||||
Preferred equity investments
|
|
17,623
|
|
|
—
|
|
|
17,623
|
|
|
—
|
|
||||
Total equity securities
|
|
$
|
528,814
|
|
|
$
|
275,086
|
|
|
$
|
253,728
|
|
|
$
|
—
|
|
Short-term investments
|
|
419,796
|
|
|
—
|
|
|
419,796
|
|
|
—
|
|
||||
Other assets (see Note 9)
|
|
68,892
|
|
|
4
|
|
|
27,385
|
|
|
41,503
|
|
||||
Total assets
|
|
$
|
6,963,681
|
|
|
$
|
312,831
|
|
|
$
|
6,496,894
|
|
|
$
|
153,956
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Other liabilities (see Note 9)
|
|
$
|
46,088
|
|
|
$
|
—
|
|
|
$
|
4,059
|
|
|
$
|
42,029
|
|
Debt
|
|
737,974
|
|
|
—
|
|
|
737,974
|
|
|
—
|
|
||||
Total liabilities
|
|
$
|
784,062
|
|
|
$
|
—
|
|
|
$
|
742,033
|
|
|
$
|
42,029
|
|
•
|
Observable inputs: contract price, notional, option strike, term to expiry, interest rate, contractual limits, temperature, rainfall, windspeed, wave height, snow fall, cyclone category;
|
•
|
Unobservable inputs: correlation, composite weather variable; and
|
•
|
Both observable and unobservable: forward commodity price.
|
|
|
December 31, 2016
|
||||||||||||||
|
|
Fair Value
(Level 3)
|
|
Valuation
Techniques
|
|
Inputs
|
|
Range
|
||||||||
|
|
|
|
|
Low
|
|
High
|
|||||||||
|
|
(Commodity curve in U.S. dollars in thousands)
|
||||||||||||||
Net weather and energy related derivative assets
|
|
$
|
14,836
|
|
|
Historical
Analysis and
Simulation
|
|
Correlation
|
|
0
|
|
|
1
|
|
||
|
|
|
|
|
|
Temperature
|
|
-15F
|
|
|
115F
|
|
||||
|
|
|
|
|
|
Composite weather variable
|
|
-25 deg.
|
|
|
45 deg.
|
|
||||
|
|
|
|
|
|
Rainfall
|
|
0"
|
|
|
2"
|
|
||||
|
|
|
|
|
|
Windspeed
|
|
0.01 m/s
|
|
|
25 m/s
|
|
||||
|
|
|
|
|
|
Wave height
|
|
0 m
|
|
|
25 m
|
|
||||
|
|
|
|
|
|
Commodity curve
|
|
$
|
(1
|
)
|
|
$
|
14
|
|
|
|
December 31, 2015
|
||||||||||||||
|
|
Fair Value (Level 3)
|
|
Valuation Techniques
|
|
Inputs
|
|
Range
|
||||||||
|
|
|
|
|
Low
|
|
High
|
|||||||||
|
|
(Commodity curve in U.S. dollars in thousands)
|
||||||||||||||
Net weather and energy related derivative liabilities
|
|
$
|
526
|
|
|
Historical Analysis and Simulation
|
|
Correlation
|
|
0
|
|
|
1
|
|
||
|
|
|
|
|
|
Temperature
|
|
-15F
|
|
|
115F
|
|
||||
|
|
|
|
|
|
Composite weather variable
|
|
-25 deg.
|
|
|
45 deg.
|
|
||||
|
|
|
|
|
|
Rainfall
|
|
0"
|
|
|
2"
|
|
||||
|
|
|
|
|
|
Windspeed
|
|
0.01 m/s
|
|
|
25 m/s
|
|
||||
|
|
|
|
|
|
Snowfall
|
|
0"
|
|
|
18"
|
|
||||
|
|
|
|
|
|
Cyclone (category)
|
|
—
|
|
|
5
|
|
||||
|
|
|
|
|
|
Commodity curve
|
|
$
|
—
|
|
|
$
|
13
|
|
December 31, 2016
|
|
Fixed
maturity
investments
|
|
Other
assets
|
|
Total
assets
|
|
Other
liabilities
|
||||||||
Level 3, beginning of year
|
|
$
|
112,453
|
|
|
$
|
41,503
|
|
|
$
|
153,956
|
|
|
$
|
(42,029
|
)
|
Total equity income and losses and realized and unrealized gains and losses included in earnings
|
|
4,321
|
|
|
—
|
|
|
4,321
|
|
|
—
|
|
||||
Total income and losses included in other underwriting loss
|
|
—
|
|
|
5,796
|
|
|
5,796
|
|
|
90
|
|
||||
Change in unrealized gains and losses included in other comprehensive (loss) income
|
|
263
|
|
|
—
|
|
|
263
|
|
|
—
|
|
||||
Purchases
|
|
48,572
|
|
|
—
|
|
|
48,572
|
|
|
—
|
|
||||
Issues
|
|
—
|
|
|
22,571
|
|
|
22,571
|
|
|
(34,219
|
)
|
||||
Sales
|
|
(57,987
|
)
|
|
—
|
|
|
(57,987
|
)
|
|
—
|
|
||||
Settlements
|
|
—
|
|
|
(28,788
|
)
|
|
(28,788
|
)
|
|
49,912
|
|
||||
Transfers into Level 3
|
|
79,332
|
|
|
—
|
|
|
79,332
|
|
|
—
|
|
||||
Transfers out of Level 3
|
|
(7,267
|
)
|
|
—
|
|
|
(7,267
|
)
|
|
—
|
|
||||
Level 3, end of year
|
|
$
|
179,687
|
|
|
$
|
41,082
|
|
|
$
|
220,769
|
|
|
$
|
(26,246
|
)
|
December 31, 2015
|
|
Fixed
maturity
investments
|
|
Other
assets
|
|
Total
assets
|
|
Other
liabilities
|
||||||||
Level 3, beginning of year
|
|
$
|
12,290
|
|
|
$
|
25,615
|
|
|
$
|
37,905
|
|
|
$
|
(35,366
|
)
|
Total equity income and losses and realized and unrealized gains and losses included in earnings
|
|
(2,785
|
)
|
|
—
|
|
|
(2,785
|
)
|
|
—
|
|
||||
Total income and losses included in other underwriting loss
|
|
—
|
|
|
(2,951
|
)
|
|
(2,951
|
)
|
|
5,062
|
|
||||
Change in unrealized gains and losses included in other comprehensive (loss) income
|
|
(180
|
)
|
|
—
|
|
|
(180
|
)
|
|
—
|
|
||||
Purchases
|
|
13
|
|
|
4,750
|
|
|
4,763
|
|
|
(4,231
|
)
|
||||
Issues
|
|
—
|
|
|
21,559
|
|
|
21,559
|
|
|
(34,114
|
)
|
||||
Sales
|
|
(15,695
|
)
|
|
—
|
|
|
(15,695
|
)
|
|
—
|
|
||||
Settlements
|
|
—
|
|
|
(7,470
|
)
|
|
(7,470
|
)
|
|
26,620
|
|
||||
Transfers into Level 3
|
|
131,215
|
|
|
—
|
|
|
131,215
|
|
|
—
|
|
||||
Transfers out of Level 3
|
|
(12,405
|
)
|
|
—
|
|
|
(12,405
|
)
|
|
—
|
|
||||
Level 3, end of year
|
|
$
|
112,453
|
|
|
$
|
41,503
|
|
|
$
|
153,956
|
|
|
$
|
(42,029
|
)
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Gross reserve for losses and loss expenses, January 1
|
|
$
|
4,510,415
|
|
|
$
|
3,846,859
|
|
|
$
|
4,002,259
|
|
Reinsurance recoverable on unpaid losses
|
|
907,944
|
|
|
670,795
|
|
|
593,755
|
|
|||
Net reserve for losses and loss expenses, January 1
|
|
3,602,471
|
|
|
3,176,064
|
|
|
3,408,504
|
|
|||
Incurred related to:
|
|
|
|
|
|
|
||||||
Current year
|
|
1,542,602
|
|
|
1,160,572
|
|
|
1,203,977
|
|
|||
Prior years
|
|
(221,550
|
)
|
|
(243,464
|
)
|
|
(233,815
|
)
|
|||
Total incurred
|
|
1,321,052
|
|
|
917,108
|
|
|
970,162
|
|
|||
Paid related to:
|
|
|
|
|
|
|
||||||
Current year
|
|
(295,863
|
)
|
|
(265,898
|
)
|
|
(439,169
|
)
|
|||
Prior years
|
|
(890,027
|
)
|
|
(867,739
|
)
|
|
(719,043
|
)
|
|||
Total paid
|
|
(1,185,890
|
)
|
|
(1,133,637
|
)
|
|
(1,158,212
|
)
|
|||
|
|
|
|
|
|
|
||||||
Amounts acquired
(1)
|
|
—
|
|
|
675,019
|
|
|
—
|
|
|||
Foreign currency translation and other
|
|
(45,624
|
)
|
|
(32,083
|
)
|
|
(44,390
|
)
|
|||
|
|
|
|
|
|
|
||||||
Net reserve for losses and loss expenses, December 31
|
|
3,692,009
|
|
|
3,602,471
|
|
|
3,176,064
|
|
|||
Reinsurance recoverable on unpaid losses
|
|
1,213,129
|
|
|
907,944
|
|
|
670,795
|
|
|||
Gross reserve for losses and loss expenses, December 31
|
|
$
|
4,905,138
|
|
|
$
|
4,510,415
|
|
|
$
|
3,846,859
|
|
Insurance Segment - Casualty & Other Specialty
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Incurred losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
At December 31, 2016
|
|||||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
IBNR reserves
|
|
Cumulative number of reported claims
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
254,678
|
|
$
|
251,840
|
|
$
|
228,021
|
|
$
|
232,156
|
|
$
|
232,186
|
|
$
|
235,482
|
|
$
|
213,895
|
|
$
|
197,246
|
|
$
|
196,072
|
|
$
|
191,927
|
|
|
$
|
20,274
|
|
|
988
|
|
2008
|
—
|
|
285,334
|
|
296,079
|
|
333,844
|
|
366,479
|
|
363,094
|
|
347,477
|
|
339,927
|
|
328,153
|
|
312,759
|
|
|
35,706
|
|
|
1,602
|
|
|||||||||||
2009
|
—
|
|
—
|
|
198,689
|
|
240,235
|
|
237,368
|
|
237,101
|
|
234,983
|
|
230,594
|
|
218,900
|
|
206,077
|
|
|
24,553
|
|
|
2,509
|
|
|||||||||||
2010
|
—
|
|
—
|
|
—
|
|
150,636
|
|
179,854
|
|
179,208
|
|
175,922
|
|
160,450
|
|
135,214
|
|
122,748
|
|
|
19,995
|
|
|
2,738
|
|
|||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
151,344
|
|
169,803
|
|
222,470
|
|
226,274
|
|
201,355
|
|
186,588
|
|
|
48,836
|
|
|
4,319
|
|
|||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
164,568
|
|
182,924
|
|
187,141
|
|
183,644
|
|
179,929
|
|
|
73,724
|
|
|
6,268
|
|
|||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
153,377
|
|
165,853
|
|
205,041
|
|
230,081
|
|
|
81,540
|
|
|
6,790
|
|
|||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
120,226
|
|
132,184
|
|
141,970
|
|
|
84,031
|
|
|
7,969
|
|
|||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
145,828
|
|
156,771
|
|
|
77,472
|
|
|
8,717
|
|
|||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
165,558
|
|
|
137,608
|
|
|
5,305
|
|
|||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
1,894,408
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Cumulative paid losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
|
|
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
9,090
|
|
$
|
38,777
|
|
$
|
66,865
|
|
$
|
103,283
|
|
$
|
124,887
|
|
$
|
139,923
|
|
$
|
144,982
|
|
$
|
152,297
|
|
$
|
159,687
|
|
$
|
163,236
|
|
|
|
|
|
|||
2008
|
—
|
|
36,479
|
|
82,811
|
|
129,840
|
|
169,331
|
|
200,021
|
|
239,185
|
|
255,585
|
|
261,201
|
|
266,264
|
|
|
|
|
|
|||||||||||||
2009
|
—
|
|
—
|
|
15,098
|
|
50,815
|
|
83,210
|
|
103,922
|
|
139,011
|
|
150,241
|
|
160,903
|
|
168,351
|
|
|
|
|
|
|||||||||||||
2010
|
—
|
|
—
|
|
—
|
|
863
|
|
4,279
|
|
27,379
|
|
64,917
|
|
83,634
|
|
88,737
|
|
96,785
|
|
|
|
|
|
|||||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
3,279
|
|
14,468
|
|
30,074
|
|
54,598
|
|
91,817
|
|
97,285
|
|
|
|
|
|
|||||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3,707
|
|
16,190
|
|
32,686
|
|
51,381
|
|
75,508
|
|
|
|
|
|
|||||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3,145
|
|
15,581
|
|
89,771
|
|
119,524
|
|
|
|
|
|
|||||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3,389
|
|
18,914
|
|
36,446
|
|
|
|
|
|
|||||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
18,426
|
|
49,196
|
|
|
|
|
|
|||||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
14,281
|
|
|
|
|
|
|||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
1,086,876
|
|
|
|
|
|
|||||||||||||||||||||
|
|
Reserve for losses and loss expenses from accident year 2006 and prior, net of reinsurance
|
|
30,599
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Adjustment for unallocated claim expenses
|
|
43,666
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Reserve for losses and loss expenses, net of reinsurance
|
|
$
|
881,797
|
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Insurance Segment - Professional Lines
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Incurred losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
At December 31, 2016
|
|||||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
IBNR reserves
|
|
Cumulative number of reported claims
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
52,739
|
|
$
|
110,525
|
|
$
|
150,972
|
|
$
|
120,358
|
|
$
|
119,243
|
|
$
|
117,895
|
|
$
|
113,520
|
|
$
|
116,711
|
|
$
|
125,496
|
|
$
|
122,969
|
|
|
$
|
47
|
|
|
232
|
|
2008
|
—
|
|
62,838
|
|
62,586
|
|
83,358
|
|
88,047
|
|
96,887
|
|
109,471
|
|
127,641
|
|
138,119
|
|
164,412
|
|
|
3,932
|
|
|
379
|
|
|||||||||||
2009
|
—
|
|
—
|
|
100,914
|
|
118,432
|
|
104,421
|
|
106,597
|
|
109,441
|
|
99,973
|
|
92,165
|
|
93,803
|
|
|
5,728
|
|
|
1,039
|
|
|||||||||||
2010
|
—
|
|
—
|
|
—
|
|
108,369
|
|
105,611
|
|
101,591
|
|
92,931
|
|
82,421
|
|
74,856
|
|
69,387
|
|
|
9,860
|
|
|
1,594
|
|
|||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
102,012
|
|
98,353
|
|
99,466
|
|
79,988
|
|
98,989
|
|
105,619
|
|
|
15,265
|
|
|
1,232
|
|
|||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
101,872
|
|
103,358
|
|
101,426
|
|
79,591
|
|
69,333
|
|
|
18,080
|
|
|
1,233
|
|
|||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
78,988
|
|
79,732
|
|
70,564
|
|
61,499
|
|
|
27,377
|
|
|
1,255
|
|
|||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
64,437
|
|
66,524
|
|
57,446
|
|
|
29,232
|
|
|
2,599
|
|
|||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
74,823
|
|
72,559
|
|
|
58,966
|
|
|
3,464
|
|
|||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
107,761
|
|
|
99,005
|
|
|
3,814
|
|
|||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
924,788
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Cumulative paid losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
|
|
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
83
|
|
$
|
987
|
|
$
|
1,744
|
|
$
|
62,321
|
|
$
|
90,128
|
|
$
|
100,560
|
|
$
|
100,693
|
|
$
|
110,254
|
|
$
|
120,328
|
|
$
|
122,867
|
|
|
|
|
|
|||
2008
|
—
|
|
54
|
|
1,898
|
|
14,027
|
|
15,888
|
|
16,613
|
|
48,997
|
|
72,576
|
|
98,770
|
|
113,175
|
|
|
|
|
|
|||||||||||||
2009
|
—
|
|
—
|
|
1,045
|
|
8,755
|
|
32,193
|
|
38,000
|
|
56,126
|
|
73,072
|
|
77,628
|
|
80,201
|
|
|
|
|
|
|||||||||||||
2010
|
—
|
|
—
|
|
—
|
|
1,932
|
|
16,014
|
|
27,557
|
|
36,506
|
|
46,982
|
|
48,978
|
|
51,885
|
|
|
|
|
|
|||||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
2,367
|
|
11,766
|
|
21,266
|
|
33,639
|
|
71,782
|
|
85,003
|
|
|
|
|
|
|||||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2,582
|
|
13,185
|
|
22,237
|
|
29,854
|
|
35,678
|
|
|
|
|
|
|||||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2,193
|
|
13,807
|
|
21,289
|
|
26,783
|
|
|
|
|
|
|||||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1,167
|
|
7,081
|
|
20,020
|
|
|
|
|
|
|||||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1,243
|
|
7,130
|
|
|
|
|
|
|||||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2,324
|
|
|
|
|
|
|||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
545,066
|
|
|
|
|
|
|||||||||||||||||||||
|
|
Reserve for losses and loss expenses from accident year 2006 and prior, net of reinsurance
|
|
61
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Adjustment for unallocated claim expenses
|
|
26,477
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Reserve for losses and loss expenses, net of reinsurance
|
|
$
|
406,260
|
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Insurance Segment - Property, Marine/Energy & Aviation
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Incurred losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
At December 31, 2016
|
|||||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
IBNR reserves
|
|
Cumulative number of reported claims
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
45,128
|
|
$
|
32,772
|
|
$
|
25,714
|
|
$
|
28,766
|
|
$
|
29,071
|
|
$
|
28,925
|
|
$
|
33,206
|
|
$
|
33,741
|
|
$
|
34,083
|
|
$
|
32,680
|
|
|
$
|
—
|
|
|
201
|
|
2008
|
—
|
|
113,427
|
|
104,626
|
|
84,425
|
|
74,111
|
|
84,093
|
|
80,158
|
|
78,176
|
|
78,178
|
|
77,373
|
|
|
13
|
|
|
459
|
|
|||||||||||
2009
|
—
|
|
—
|
|
60,589
|
|
48,196
|
|
23,651
|
|
21,225
|
|
19,933
|
|
19,423
|
|
19,780
|
|
19,341
|
|
|
33
|
|
|
568
|
|
|||||||||||
2010
|
—
|
|
—
|
|
—
|
|
93,741
|
|
54,986
|
|
48,033
|
|
42,918
|
|
41,703
|
|
42,202
|
|
43,240
|
|
|
992
|
|
|
1,423
|
|
|||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
163,234
|
|
139,932
|
|
125,588
|
|
124,243
|
|
127,840
|
|
133,297
|
|
|
256
|
|
|
2,486
|
|
|||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
172,535
|
|
137,329
|
|
123,134
|
|
121,281
|
|
121,873
|
|
|
405
|
|
|
2,704
|
|
|||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
115,600
|
|
101,878
|
|
85,794
|
|
80,971
|
|
|
3,933
|
|
|
3,145
|
|
|||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
136,748
|
|
114,243
|
|
102,002
|
|
|
7,588
|
|
|
4,405
|
|
|||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
183,192
|
|
184,867
|
|
|
18,890
|
|
|
6,281
|
|
|||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
234,235
|
|
|
72,271
|
|
|
6,600
|
|
|||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
1,029,879
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Cumulative paid losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
|
|
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
10,626
|
|
$
|
19,644
|
|
$
|
21,987
|
|
$
|
22,614
|
|
$
|
23,482
|
|
$
|
23,780
|
|
$
|
32,561
|
|
$
|
33,546
|
|
$
|
34,084
|
|
$
|
32,671
|
|
|
|
|
|
|||
2008
|
—
|
|
40,140
|
|
57,685
|
|
62,922
|
|
64,434
|
|
75,187
|
|
75,042
|
|
77,234
|
|
77,910
|
|
77,239
|
|
|
|
|
|
|||||||||||||
2009
|
—
|
|
—
|
|
11,014
|
|
16,967
|
|
18,120
|
|
18,657
|
|
18,887
|
|
19,075
|
|
19,407
|
|
19,261
|
|
|
|
|
|
|||||||||||||
2010
|
—
|
|
—
|
|
—
|
|
11,680
|
|
29,150
|
|
33,938
|
|
36,306
|
|
38,880
|
|
40,782
|
|
41,802
|
|
|
|
|
|
|||||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
17,871
|
|
63,710
|
|
82,967
|
|
103,301
|
|
117,337
|
|
123,496
|
|
|
|
|
|
|||||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
18,709
|
|
79,533
|
|
87,216
|
|
102,447
|
|
108,983
|
|
|
|
|
|
|||||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
20,929
|
|
57,243
|
|
66,851
|
|
71,423
|
|
|
|
|
|
|||||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
26,491
|
|
60,418
|
|
79,321
|
|
|
|
|
|
|||||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
52,121
|
|
131,697
|
|
|
|
|
|
|||||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
77,448
|
|
|
|
|
|
|||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
763,341
|
|
|
|
|
|
|||||||||||||||||||||
|
|
Reserve for losses and loss expenses from accident year 2006 and prior, net of reinsurance
|
|
3
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Adjustment for unallocated claim expenses
|
|
7,855
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Reserve for losses and loss expenses, net of reinsurance
|
|
$
|
274,396
|
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reinsurance Segment - Catastrophe
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Incurred losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
At December 31, 2016
|
|||||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
IBNR reserves
|
|
Cumulative number of reported claims
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
168,640
|
|
$
|
126,561
|
|
$
|
104,527
|
|
$
|
102,855
|
|
$
|
91,502
|
|
$
|
88,252
|
|
$
|
86,273
|
|
$
|
90,379
|
|
$
|
97,851
|
|
$
|
102,929
|
|
|
$
|
153
|
|
|
192
|
|
2008
|
—
|
|
405,190
|
|
378,838
|
|
389,111
|
|
392,668
|
|
384,117
|
|
382,382
|
|
382,068
|
|
384,864
|
|
381,551
|
|
|
317
|
|
|
336
|
|
|||||||||||
2009
|
—
|
|
—
|
|
102,411
|
|
74,817
|
|
59,051
|
|
55,933
|
|
55,229
|
|
56,944
|
|
58,910
|
|
60,788
|
|
|
559
|
|
|
204
|
|
|||||||||||
2010
|
—
|
|
—
|
|
—
|
|
272,094
|
|
234,576
|
|
226,060
|
|
226,208
|
|
231,531
|
|
237,677
|
|
224,323
|
|
|
1,394
|
|
|
265
|
|
|||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
622,350
|
|
591,965
|
|
589,614
|
|
603,680
|
|
612,274
|
|
624,448
|
|
|
4,640
|
|
|
574
|
|
|||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
245,011
|
|
180,145
|
|
163,109
|
|
154,240
|
|
151,003
|
|
|
3,884
|
|
|
345
|
|
|||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
157,097
|
|
129,469
|
|
127,984
|
|
124,311
|
|
|
1,454
|
|
|
315
|
|
|||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
141,173
|
|
126,822
|
|
126,512
|
|
|
3,156
|
|
|
229
|
|
|||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
60,465
|
|
47,255
|
|
|
4,057
|
|
|
224
|
|
|||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
137,357
|
|
|
27,654
|
|
|
216
|
|
|||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
1,980,477
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Cumulative paid losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
|
|
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
31,590
|
|
$
|
85,271
|
|
$
|
87,267
|
|
$
|
91,214
|
|
$
|
83,511
|
|
$
|
82,285
|
|
$
|
80,852
|
|
$
|
88,684
|
|
$
|
97,279
|
|
$
|
102,497
|
|
|
|
|
|
|||
2008
|
—
|
|
154,382
|
|
255,721
|
|
316,023
|
|
353,658
|
|
375,455
|
|
378,322
|
|
380,366
|
|
382,431
|
|
380,409
|
|
|
|
|
|
|||||||||||||
2009
|
—
|
|
—
|
|
26,869
|
|
45,763
|
|
48,440
|
|
49,847
|
|
51,013
|
|
54,189
|
|
57,551
|
|
59,865
|
|
|
|
|
|
|||||||||||||
2010
|
—
|
|
—
|
|
—
|
|
58,556
|
|
124,322
|
|
152,264
|
|
173,341
|
|
193,340
|
|
207,716
|
|
208,329
|
|
|
|
|
|
|||||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
230,619
|
|
385,304
|
|
495,351
|
|
561,864
|
|
593,831
|
|
615,504
|
|
|
|
|
|
|||||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
56,614
|
|
105,745
|
|
126,802
|
|
134,288
|
|
136,862
|
|
|
|
|
|
|||||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
34,236
|
|
83,259
|
|
106,983
|
|
116,996
|
|
|
|
|
|
|||||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
49,337
|
|
107,546
|
|
117,040
|
|
|
|
|
|
|||||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
20,084
|
|
31,850
|
|
|
|
|
|
|||||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
43,793
|
|
|
|
|
|
|||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
1,813,145
|
|
|
|
|
|
|||||||||||||||||||||
|
|
Reserve for losses and loss expenses from accident year 2006 and prior, net of reinsurance
|
|
91
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Adjustment for unallocated claim expenses
|
|
3,002
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Reserve for losses and loss expenses, net of reinsurance
|
|
$
|
170,425
|
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reinsurance Segment - Property
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Incurred losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
At December 31, 2016
|
|||||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
IBNR reserves
|
|
Cumulative number of reported claims
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
123,502
|
|
$
|
137,474
|
|
$
|
127,294
|
|
$
|
120,598
|
|
$
|
116,552
|
|
$
|
115,947
|
|
$
|
119,773
|
|
$
|
121,653
|
|
$
|
121,902
|
|
$
|
117,706
|
|
|
$
|
2
|
|
|
309
|
|
2008
|
—
|
|
173,437
|
|
151,764
|
|
133,022
|
|
123,162
|
|
124,861
|
|
126,887
|
|
126,991
|
|
125,622
|
|
122,943
|
|
|
3
|
|
|
612
|
|
|||||||||||
2009
|
—
|
|
—
|
|
151,371
|
|
123,151
|
|
116,114
|
|
114,137
|
|
114,342
|
|
115,111
|
|
115,213
|
|
111,782
|
|
|
114
|
|
|
991
|
|
|||||||||||
2010
|
—
|
|
—
|
|
—
|
|
221,480
|
|
216,726
|
|
190,322
|
|
186,817
|
|
188,516
|
|
188,304
|
|
174,952
|
|
|
419
|
|
|
1,126
|
|
|||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
344,015
|
|
334,865
|
|
312,365
|
|
312,278
|
|
305,567
|
|
335,228
|
|
|
2,089
|
|
|
942
|
|
|||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
314,924
|
|
259,753
|
|
240,928
|
|
240,070
|
|
244,651
|
|
|
2,224
|
|
|
813
|
|
|||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
255,632
|
|
239,844
|
|
217,661
|
|
199,195
|
|
|
5,650
|
|
|
1,017
|
|
|||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
211,769
|
|
211,888
|
|
197,761
|
|
|
11,702
|
|
|
1,060
|
|
|||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
184,586
|
|
181,761
|
|
|
16,927
|
|
|
880
|
|
|||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
166,629
|
|
|
55,289
|
|
|
542
|
|
|||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
1,852,608
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Cumulative paid losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
|
|
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
23,678
|
|
$
|
71,828
|
|
$
|
103,059
|
|
$
|
111,825
|
|
$
|
111,155
|
|
$
|
112,559
|
|
$
|
116,499
|
|
$
|
119,203
|
|
$
|
120,881
|
|
$
|
116,680
|
|
|
|
|
|
|||
2008
|
—
|
|
30,553
|
|
79,457
|
|
104,279
|
|
107,291
|
|
110,039
|
|
118,745
|
|
122,512
|
|
123,954
|
|
121,472
|
|
|
|
|
|
|||||||||||||
2009
|
—
|
|
—
|
|
27,690
|
|
71,123
|
|
89,940
|
|
97,377
|
|
103,688
|
|
107,021
|
|
109,796
|
|
107,609
|
|
|
|
|
|
|||||||||||||
2010
|
—
|
|
—
|
|
—
|
|
49,442
|
|
117,260
|
|
141,348
|
|
163,173
|
|
175,919
|
|
180,555
|
|
170,367
|
|
|
|
|
|
|||||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
76,880
|
|
172,679
|
|
254,657
|
|
286,065
|
|
291,961
|
|
326,570
|
|
|
|
|
|
|||||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
53,488
|
|
146,671
|
|
192,022
|
|
214,711
|
|
230,684
|
|
|
|
|
|
|||||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
55,668
|
|
138,841
|
|
173,888
|
|
176,721
|
|
|
|
|
|
|||||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
51,635
|
|
134,663
|
|
158,766
|
|
|
|
|
|
|||||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
37,685
|
|
100,328
|
|
|
|
|
|
|||||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
33,787
|
|
|
|
|
|
|||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
1,542,984
|
|
|
|
|
|
|||||||||||||||||||||
|
|
Reserve for losses and loss expenses from accident year 2006 and prior, net of reinsurance
|
|
4,954
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Adjustment for unallocated claim expenses
|
|
4,301
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Reserve for losses and loss expenses, net of reinsurance
|
|
$
|
318,879
|
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reinsurance Segment - Casualty
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Incurred losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
At December 31, 2016
|
|||||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
IBNR reserves
|
|
Cumulative number of reported claims
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
108,468
|
|
$
|
116,074
|
|
$
|
116,095
|
|
$
|
120,815
|
|
$
|
115,024
|
|
$
|
114,484
|
|
$
|
112,945
|
|
$
|
111,664
|
|
$
|
110,369
|
|
$
|
112,366
|
|
|
$
|
13,382
|
|
|
549
|
|
2008
|
—
|
|
112,680
|
|
118,736
|
|
116,204
|
|
114,790
|
|
107,336
|
|
101,613
|
|
98,504
|
|
97,260
|
|
93,732
|
|
|
9,538
|
|
|
406
|
|
|||||||||||
2009
|
—
|
|
—
|
|
116,515
|
|
126,969
|
|
124,218
|
|
127,972
|
|
126,505
|
|
121,969
|
|
115,317
|
|
114,901
|
|
|
20,438
|
|
|
433
|
|
|||||||||||
2010
|
—
|
|
—
|
|
—
|
|
186,667
|
|
179,891
|
|
176,073
|
|
170,938
|
|
172,699
|
|
160,142
|
|
159,409
|
|
|
27,794
|
|
|
506
|
|
|||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
198,159
|
|
199,035
|
|
197,138
|
|
204,187
|
|
195,094
|
|
196,946
|
|
|
35,929
|
|
|
604
|
|
|||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
195,983
|
|
191,436
|
|
193,164
|
|
183,512
|
|
174,625
|
|
|
42,134
|
|
|
701
|
|
|||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
178,401
|
|
172,604
|
|
170,144
|
|
163,986
|
|
|
62,188
|
|
|
842
|
|
|||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
125,515
|
|
120,521
|
|
119,143
|
|
|
45,271
|
|
|
615
|
|
|||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
119,276
|
|
119,529
|
|
|
58,182
|
|
|
250
|
|
|||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
143,263
|
|
|
106,858
|
|
|
127
|
|
|||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
1,397,900
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Cumulative paid losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
|
|
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
3,009
|
|
$
|
13,399
|
|
$
|
23,890
|
|
$
|
35,928
|
|
$
|
48,519
|
|
$
|
57,254
|
|
$
|
64,711
|
|
$
|
73,518
|
|
$
|
77,378
|
|
$
|
87,170
|
|
|
|
|
|
|||
2008
|
—
|
|
8,475
|
|
17,338
|
|
30,528
|
|
43,923
|
|
51,831
|
|
58,419
|
|
67,856
|
|
72,592
|
|
75,906
|
|
|
|
|
|
|||||||||||||
2009
|
—
|
|
—
|
|
7,367
|
|
21,841
|
|
34,770
|
|
51,576
|
|
61,615
|
|
70,558
|
|
76,463
|
|
83,892
|
|
|
|
|
|
|||||||||||||
2010
|
—
|
|
—
|
|
—
|
|
14,826
|
|
34,469
|
|
56,997
|
|
75,290
|
|
92,382
|
|
104,037
|
|
114,875
|
|
|
|
|
|
|||||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
28,035
|
|
50,998
|
|
77,748
|
|
104,394
|
|
116,519
|
|
141,449
|
|
|
|
|
|
|||||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
30,667
|
|
54,457
|
|
75,456
|
|
92,072
|
|
105,209
|
|
|
|
|
|
|||||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
18,577
|
|
35,808
|
|
56,564
|
|
71,677
|
|
|
|
|
|
|||||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
10,390
|
|
33,215
|
|
49,951
|
|
|
|
|
|
|||||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
15,817
|
|
34,396
|
|
|
|
|
|
|||||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
18,837
|
|
|
|
|
|
|||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
783,362
|
|
|
|
|
|
|||||||||||||||||||||
|
|
Reserve for losses and loss expenses from accident year 2006 and prior, net of reinsurance
|
|
106,483
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Adjustment for unallocated claim expenses
|
|
10,637
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Reserve for losses and loss expenses, net of reinsurance
|
|
$
|
731,658
|
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reinsurance Segment - Professional Lines
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Incurred losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
At December 31, 2016
|
|||||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
IBNR reserves
|
|
Cumulative number of reported claims
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
46,031
|
|
$
|
51,283
|
|
$
|
49,539
|
|
$
|
43,988
|
|
$
|
41,956
|
|
$
|
41,037
|
|
$
|
43,261
|
|
$
|
42,115
|
|
$
|
41,989
|
|
$
|
37,980
|
|
|
$
|
1,539
|
|
|
310
|
|
2008
|
—
|
|
41,797
|
|
50,276
|
|
47,154
|
|
44,672
|
|
47,084
|
|
44,526
|
|
42,863
|
|
41,599
|
|
39,059
|
|
|
1,171
|
|
|
262
|
|
|||||||||||
2009
|
—
|
|
—
|
|
41,430
|
|
43,003
|
|
41,681
|
|
40,763
|
|
35,771
|
|
36,560
|
|
36,474
|
|
38,720
|
|
|
2,098
|
|
|
204
|
|
|||||||||||
2010
|
—
|
|
—
|
|
—
|
|
58,153
|
|
58,567
|
|
67,335
|
|
62,185
|
|
53,825
|
|
46,661
|
|
45,024
|
|
|
3,733
|
|
|
110
|
|
|||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
55,812
|
|
56,535
|
|
55,286
|
|
44,921
|
|
36,691
|
|
31,390
|
|
|
4,828
|
|
|
57
|
|
|||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
43,519
|
|
42,443
|
|
43,426
|
|
36,707
|
|
30,576
|
|
|
5,803
|
|
|
81
|
|
|||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
48,933
|
|
49,513
|
|
45,382
|
|
41,403
|
|
|
21,619
|
|
|
48
|
|
|||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
91,943
|
|
88,915
|
|
90,713
|
|
|
50,367
|
|
|
62
|
|
|||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
130,595
|
|
130,832
|
|
|
99,261
|
|
|
55
|
|
|||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
148,671
|
|
|
139,857
|
|
|
10
|
|
|||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
634,368
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Cumulative paid losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
|
|
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
144
|
|
$
|
2,310
|
|
$
|
5,649
|
|
$
|
10,694
|
|
$
|
16,764
|
|
$
|
21,259
|
|
$
|
28,121
|
|
$
|
30,796
|
|
$
|
33,144
|
|
$
|
32,771
|
|
|
|
|
|
|||
2008
|
—
|
|
341
|
|
2,156
|
|
6,200
|
|
12,752
|
|
22,496
|
|
26,811
|
|
30,169
|
|
32,873
|
|
33,434
|
|
|
|
|
|
|||||||||||||
2009
|
—
|
|
—
|
|
1,033
|
|
3,330
|
|
7,963
|
|
15,666
|
|
19,184
|
|
23,469
|
|
27,039
|
|
32,329
|
|
|
|
|
|
|||||||||||||
2010
|
—
|
|
—
|
|
—
|
|
2,249
|
|
7,348
|
|
14,481
|
|
24,511
|
|
31,313
|
|
36,100
|
|
36,181
|
|
|
|
|
|
|||||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
1,685
|
|
4,943
|
|
9,405
|
|
15,168
|
|
20,124
|
|
22,142
|
|
|
|
|
|
|||||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
965
|
|
1,929
|
|
4,204
|
|
9,147
|
|
13,757
|
|
|
|
|
|
|||||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
997
|
|
2,561
|
|
6,694
|
|
11,636
|
|
|
|
|
|
|||||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1,149
|
|
6,446
|
|
22,822
|
|
|
|
|
|
|||||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2,941
|
|
14,357
|
|
|
|
|
|
|||||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1,920
|
|
|
|
|
|
|||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
221,349
|
|
|
|
|
|
|||||||||||||||||||||
|
|
Reserve for losses and loss expenses from accident year 2006 and prior, net of reinsurance
|
|
5,540
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Adjustment for unallocated claim expenses
|
|
6,164
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Reserve for losses and loss expenses, net of reinsurance
|
|
$
|
424,723
|
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reinsurance Segment - Specialty
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Incurred losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
At December 31, 2016
|
|||||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
IBNR reserves
|
|
Cumulative number of reported claims
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
229,505
|
|
$
|
202,655
|
|
$
|
197,905
|
|
$
|
193,084
|
|
$
|
189,577
|
|
$
|
187,961
|
|
$
|
187,949
|
|
$
|
185,743
|
|
$
|
183,044
|
|
$
|
174,205
|
|
|
$
|
435
|
|
|
288
|
|
2008
|
—
|
|
125,389
|
|
94,050
|
|
92,039
|
|
79,903
|
|
79,052
|
|
77,556
|
|
75,348
|
|
73,745
|
|
67,604
|
|
|
3,549
|
|
|
195
|
|
|||||||||||
2009
|
—
|
|
—
|
|
98,431
|
|
81,269
|
|
73,387
|
|
69,691
|
|
67,605
|
|
65,333
|
|
62,834
|
|
62,501
|
|
|
4,414
|
|
|
170
|
|
|||||||||||
2010
|
—
|
|
—
|
|
—
|
|
123,741
|
|
107,630
|
|
97,718
|
|
86,949
|
|
85,252
|
|
84,817
|
|
82,937
|
|
|
1,856
|
|
|
218
|
|
|||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
111,517
|
|
100,639
|
|
86,832
|
|
82,514
|
|
82,984
|
|
82,014
|
|
|
2,565
|
|
|
274
|
|
|||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
135,448
|
|
111,813
|
|
99,700
|
|
92,162
|
|
85,852
|
|
|
5,174
|
|
|
294
|
|
|||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
103,014
|
|
93,335
|
|
92,119
|
|
83,806
|
|
|
9,865
|
|
|
329
|
|
|||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
120,335
|
|
116,642
|
|
108,392
|
|
|
19,693
|
|
|
342
|
|
|||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
150,288
|
|
149,473
|
|
|
35,118
|
|
|
318
|
|
|||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
156,042
|
|
|
111,660
|
|
|
134
|
|
|||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
1,052,826
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Cumulative paid losses and loss expenses, net of reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||||||
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||||||||||||||
Accident Year
|
2007
|
2008
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
|
|
|
|
|||||||||||||||||||||||
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
||||||||||||||
2007
|
$
|
16,023
|
|
$
|
123,632
|
|
$
|
143,800
|
|
$
|
153,622
|
|
$
|
160,113
|
|
$
|
169,797
|
|
$
|
174,059
|
|
$
|
175,948
|
|
$
|
177,082
|
|
$
|
169,673
|
|
|
|
|
|
|||
2008
|
—
|
|
15,525
|
|
38,261
|
|
47,410
|
|
52,461
|
|
58,971
|
|
61,915
|
|
64,489
|
|
65,005
|
|
61,384
|
|
|
|
|
|
|||||||||||||
2009
|
—
|
|
—
|
|
13,286
|
|
33,142
|
|
39,439
|
|
43,804
|
|
47,556
|
|
52,481
|
|
52,635
|
|
55,068
|
|
|
|
|
|
|||||||||||||
2010
|
—
|
|
—
|
|
—
|
|
15,110
|
|
48,043
|
|
57,822
|
|
64,199
|
|
68,915
|
|
72,072
|
|
74,797
|
|
|
|
|
|
|||||||||||||
2011
|
—
|
|
—
|
|
—
|
|
—
|
|
22,755
|
|
44,494
|
|
61,019
|
|
68,869
|
|
73,730
|
|
75,760
|
|
|
|
|
|
|||||||||||||
2012
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
29,756
|
|
53,695
|
|
64,242
|
|
72,510
|
|
74,517
|
|
|
|
|
|
|||||||||||||
2013
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
14,696
|
|
37,621
|
|
52,015
|
|
62,458
|
|
|
|
|
|
|||||||||||||
2014
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
23,579
|
|
49,847
|
|
66,813
|
|
|
|
|
|
|||||||||||||
2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
18,994
|
|
70,659
|
|
|
|
|
|
|||||||||||||
2016
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
19,265
|
|
|
|
|
|
|||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
$
|
730,394
|
|
|
|
|
|
|||||||||||||||||||||
|
|
Reserve for losses and loss expenses from accident year 2006 and prior, net of reinsurance
|
|
24,265
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Adjustment for unallocated claim expenses
|
|
6,119
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Reserve for losses and loss expenses, net of reinsurance
|
|
$
|
352,816
|
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2016
|
||||||||
|
Net reserve for losses and loss expenses
|
Reinsurance recoverable on unpaid losses
|
Gross reserve for losses and loss expenses
|
||||||||
|
Insurance
|
|
|
|
|||||||
|
|
Agriculture
|
$
|
131,055
|
|
$
|
116,832
|
|
$
|
247,887
|
|
|
|
Casualty & other specialty
|
881,797
|
|
490,447
|
|
1,372,244
|
|
|||
|
|
Professional lines
|
406,260
|
|
305,114
|
|
711,374
|
|
|||
|
|
Property, marine/energy & aviation
|
274,396
|
|
193,088
|
|
467,484
|
|
|||
|
Reinsurance
|
|
|
|
|||||||
|
|
Catastrophe
|
170,425
|
|
39,419
|
|
209,844
|
|
|||
|
|
Property
|
318,879
|
|
1,466
|
|
320,345
|
|
|||
|
|
Casualty
|
731,658
|
|
1,175
|
|
732,833
|
|
|||
|
|
Professional lines
|
424,723
|
|
449
|
|
425,172
|
|
|||
|
|
Specialty
|
352,816
|
|
65,139
|
|
417,955
|
|
|||
|
Total
|
$
|
3,692,009
|
|
$
|
1,213,129
|
|
$
|
4,905,138
|
|
|
|
Average annual percentage payout of incurred claims by age, net of reinsurance (number of years)
|
|||||||||||||||||||
|
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
||||||||||
Insurance Segment
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Agriculture
|
73.3
|
%
|
24.1
|
%
|
0.1
|
%
|
0.3
|
%
|
—
|
%
|
—
|
%
|
—
|
%
|
—
|
%
|
—
|
%
|
—
|
%
|
|
Casualty & other specialty
|
5.5
|
%
|
11.3
|
%
|
15.5
|
%
|
15.1
|
%
|
12.8
|
%
|
7.1
|
%
|
4.5
|
%
|
2.7
|
%
|
3.7
|
%
|
1.4
|
%
|
|
Professional lines
|
1.5
|
%
|
7.8
|
%
|
11.0
|
%
|
14.3
|
%
|
15.0
|
%
|
14.4
|
%
|
10.3
|
%
|
8.9
|
%
|
8.3
|
%
|
7.2
|
%
|
|
Property, marine/energy & aviation
|
24.4
|
%
|
39.3
|
%
|
18.0
|
%
|
9.9
|
%
|
4.3
|
%
|
2.1
|
%
|
3.2
|
%
|
0.4
|
%
|
1.1
|
%
|
0.2
|
%
|
Reinsurance Segment
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Catastrophe
|
32.4
|
%
|
36.1
|
%
|
15.4
|
%
|
7.6
|
%
|
3.4
|
%
|
1.7
|
%
|
0.2
|
%
|
0.3
|
%
|
1.3
|
%
|
1.0
|
%
|
|
Property
|
24.1
|
%
|
39.4
|
%
|
19.5
|
%
|
6.5
|
%
|
3.5
|
%
|
2.7
|
%
|
0.5
|
%
|
0.9
|
%
|
0.9
|
%
|
0.3
|
%
|
|
Casualty
|
9.2
|
%
|
12.6
|
%
|
12.7
|
%
|
11.9
|
%
|
9.9
|
%
|
8.2
|
%
|
6.3
|
%
|
5.5
|
%
|
4.4
|
%
|
3.2
|
%
|
|
Professional lines
|
1.9
|
%
|
6.7
|
%
|
12.1
|
%
|
18.5
|
%
|
16.9
|
%
|
12.2
|
%
|
8.2
|
%
|
6.4
|
%
|
4.3
|
%
|
3.3
|
%
|
|
Specialty
|
13.9
|
%
|
37.7
|
%
|
20.6
|
%
|
7.0
|
%
|
7.6
|
%
|
4.6
|
%
|
2.2
|
%
|
3.1
|
%
|
0.6
|
%
|
—
|
%
|
|
|
Year Ended December 31, 2016
|
|
Year Ended December 31, 2015
|
|
Year Ended December 31, 2014
|
||||||||||||||||||
|
|
Earned
|
|
Written
|
|
Earned
|
|
Written
|
|
Earned
|
|
Written
|
||||||||||||
Direct
|
|
$
|
2,336,314
|
|
|
$
|
2,570,494
|
|
|
$
|
1,938,830
|
|
|
$
|
2,085,901
|
|
|
$
|
1,521,648
|
|
|
$
|
1,716,128
|
|
Assumed
|
|
1,635,379
|
|
|
1,631,676
|
|
|
1,331,831
|
|
|
1,234,960
|
|
|
1,132,370
|
|
|
1,177,948
|
|
||||||
Ceded
|
|
(1,608,033
|
)
|
|
(1,832,235
|
)
|
|
(1,292,208
|
)
|
|
(1,370,391
|
)
|
|
(790,040
|
)
|
|
(959,870
|
)
|
||||||
|
|
$
|
2,363,660
|
|
|
$
|
2,369,935
|
|
|
$
|
1,978,453
|
|
|
$
|
1,950,470
|
|
|
$
|
1,863,978
|
|
|
$
|
1,934,206
|
|
Rating
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
U.S. Government sponsored program
|
|
$
|
141,443
|
|
|
$
|
234,596
|
|
A+ and above
|
|
889,814
|
|
|
458,255
|
|
||
A
|
|
397,691
|
|
|
476,184
|
|
||
A-
|
|
5,805
|
|
|
7,060
|
|
||
Not rated
|
|
52,165
|
|
|
19,875
|
|
||
Total
|
|
$
|
1,486,918
|
|
|
$
|
1,195,970
|
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||
|
|
Fair
Value
|
|
Notional
Principal
Amount
|
|
Fair
Value
|
|
Notional
Principal
Amount
|
||||||||
Derivatives recorded in other assets
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward contracts
|
|
$
|
629
|
|
|
$
|
34,630
|
|
|
$
|
425
|
|
|
$
|
38,818
|
|
Credit default swaps
|
|
266
|
|
|
5,450
|
|
|
36
|
|
|
4,225
|
|
||||
Interest rate swaps
|
|
374
|
|
|
7,000
|
|
|
—
|
|
|
—
|
|
||||
ILWs
|
|
1,010
|
|
|
20,000
|
|
|
—
|
|
|
—
|
|
||||
TBAs
|
|
121,402
|
|
|
120,300
|
|
|
26,924
|
|
|
25,700
|
|
||||
Energy and weather contracts
|
|
43,035
|
|
|
101,436
|
|
|
41,507
|
|
|
70,388
|
|
||||
Total recorded in other assets
|
|
$
|
166,716
|
|
|
|
|
$
|
68,892
|
|
|
|
||||
Derivatives recorded in other liabilities
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward contracts
|
|
$
|
1,204
|
|
|
$
|
32,080
|
|
|
$
|
372
|
|
|
$
|
30,400
|
|
Credit default swaps
|
|
21
|
|
|
2,744
|
|
|
276
|
|
|
7,800
|
|
||||
Interest rate swaps
|
|
59
|
|
|
1,100
|
|
|
7
|
|
|
42,000
|
|
||||
Interest rate swaptions
|
|
34
|
|
|
5,400
|
|
|
—
|
|
|
—
|
|
||||
Interest rate futures
|
|
—
|
|
|
—
|
|
|
8
|
|
|
54,488
|
|
||||
ILWs
|
|
184
|
|
|
14,209
|
|
|
259
|
|
|
19,500
|
|
||||
LIBOR swap
|
|
27
|
|
|
100,000
|
|
|
233
|
|
|
100,000
|
|
||||
TBAs
|
|
50,704
|
|
|
50,400
|
|
|
—
|
|
|
—
|
|
||||
Loss development cover
|
|
2,818
|
|
|
24,451
|
|
|
2,904
|
|
|
22,322
|
|
||||
Energy and weather contracts
|
|
29,018
|
|
|
162,900
|
|
|
42,029
|
|
|
148,325
|
|
||||
Total recorded in other liabilities
|
|
$
|
84,069
|
|
|
|
|
$
|
46,088
|
|
|
|
||||
Net derivative asset
|
|
$
|
82,647
|
|
|
|
|
$
|
22,804
|
|
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Total gain included in net foreign exchange (gains) losses from foreign exchange forward contracts
|
|
$
|
516
|
|
|
$
|
2,095
|
|
|
$
|
1,880
|
|
|
|
|
|
|
|
|
||||||
Interest rate futures
|
|
(160
|
)
|
|
79
|
|
|
121
|
|
|||
Credit default swaps
|
|
7
|
|
|
(50
|
)
|
|
30
|
|
|||
Interest rate swaps
|
|
124
|
|
|
(915
|
)
|
|
(4,239
|
)
|
|||
Interest rate swaptions
|
|
(20
|
)
|
|
56
|
|
|
477
|
|
|||
ILWs
|
|
(1,675
|
)
|
|
(326
|
)
|
|
—
|
|
|||
LIBOR swap
|
|
206
|
|
|
332
|
|
|
—
|
|
|||
TBAs
|
|
(662
|
)
|
|
496
|
|
|
3,938
|
|
|||
Total (losses) gains included in net realized and unrealized (losses) gains
|
|
(2,180
|
)
|
|
(328
|
)
|
|
327
|
|
|||
|
|
|
|
|
|
|
||||||
Energy and weather contracts
|
|
4,835
|
|
|
2,281
|
|
|
(315
|
)
|
|||
Loss development cover
|
|
(2,129
|
)
|
|
(1,419
|
)
|
|
—
|
|
|||
Total gain (loss) included in other underwriting loss
|
|
2,706
|
|
|
862
|
|
|
(315
|
)
|
|||
|
|
|
|
|
|
|
||||||
Total gains from derivatives
|
|
$
|
1,042
|
|
|
$
|
2,629
|
|
|
$
|
1,892
|
|
•
|
Insurance – This segment is comprised of four lines of business: agriculture, casualty and other specialty, professional lines, and property, marine/energy and aviation. The agriculture line of business is comprised of multi-peril crop insurance, crop hail, livestock risk protection and other agriculture risk management products. The casualty and other specialty line of business is comprised of the insurance and facultative reinsurance of third party liability exposures, including casualty and healthcare liability. The professional line of business includes directors' and officers' liability, errors and omissions, employment practices liability, environmental liability and pension trust liability insurance. The property, marine/energy and aviation line of business is comprised of the insurance and facultative reinsurance of commercial properties, inland marine and ocean marine insurance, energy insurance, and general liability and property coverages for a wide range of general aviation risks.
|
•
|
Reinsurance – This segment is comprised of five lines of business: catastrophe, property, casualty, professional lines, and specialty. The catastrophe line of business includes reinsurance for catastrophic perils on a treaty basis. The property line of business includes proportional and excess of loss reinsurance of personal and commercial exposures. The casualty line of business is comprised of third party liability exposures, clash and workers' compensation coverages. The professional line of business includes directors' and officers' liability, errors and omissions, employment practices liability, environmental liability and pension trust liability reinsurance. The specialty line of business includes the reinsurance of aviation and space business and proportional and non-proportional reinsurance of hull and cargo insurance business, and proportional and excess of loss coverages of contract and commercial surety business, personal accident coverages, political risk coverages, weather risk management products and agriculture coverages for weather related perils as well as protection from yield and price risks.
|
|
|
Insurance
|
|
Reinsurance
|
|
Total
|
|
||||||
Revenues
|
|
|
|
|
|
|
|
||||||
Gross premiums written
|
|
$
|
2,570,494
|
|
|
$
|
1,631,676
|
|
|
$
|
4,202,170
|
|
|
Ceded premiums written
|
|
(1,514,240
|
)
|
|
(317,995
|
)
|
|
(1,832,235
|
)
|
|
|||
Net premiums written
|
|
1,056,254
|
|
|
1,313,681
|
|
|
2,369,935
|
|
|
|||
Net premiums earned
|
|
1,009,375
|
|
|
1,354,285
|
|
|
2,363,660
|
|
|
|||
Other underwriting loss
|
|
—
|
|
|
(909
|
)
|
|
(909
|
)
|
|
|||
|
|
1,009,375
|
|
|
1,353,376
|
|
|
2,362,751
|
|
|
|||
Expenses
|
|
|
|
|
|
|
|
||||||
Net losses and loss expenses
|
|
684,178
|
|
|
636,874
|
|
|
1,321,052
|
|
|
|||
Acquisition expenses
|
|
149,763
|
|
|
310,720
|
|
|
460,483
|
|
|
|||
General and administrative expenses
|
|
140,742
|
|
|
107,404
|
|
|
248,146
|
|
|
|||
|
|
974,683
|
|
|
1,054,998
|
|
|
2,029,681
|
|
|
|||
Underwriting income
|
|
$
|
34,692
|
|
|
$
|
298,378
|
|
|
333,070
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net investment income
|
|
|
|
|
|
176,590
|
|
|
|||||
Corporate expenses
|
|
|
|
|
|
(51,706
|
)
|
|
|||||
Net foreign exchange gains
|
|
|
|
|
|
74,684
|
|
|
|||||
Net realized and unrealized losses
|
|
|
|
|
|
(12,419
|
)
|
|
|||||
Net impairment losses recognized in earnings
|
|
|
|
|
|
(10,769
|
)
|
|
|||||
Amortization of intangibles
|
|
|
|
|
|
(84,624
|
)
|
|
|||||
Interest expense
|
|
|
|
|
|
(43,860
|
)
|
|
|||||
Income before income taxes
|
|
|
|
|
|
$
|
380,966
|
|
|
||||
|
|
|
|
|
|
|
|
||||||
Net loss ratio
|
|
67.9
|
%
|
|
47.1
|
%
|
|
55.9
|
%
|
|
|||
Acquisition expense ratio
|
|
14.8
|
%
|
|
22.9
|
%
|
|
19.5
|
%
|
|
|||
General and administrative expense ratio
|
|
13.9
|
%
|
|
7.9
|
%
|
|
12.7
|
%
|
(1)
|
|||
Combined ratio
|
|
96.6
|
%
|
|
77.9
|
%
|
|
88.1
|
%
|
|
|||
|
|
|
|
|
|
|
|
||||||
Reserve for losses and loss expenses
|
|
$
|
2,798,989
|
|
|
$
|
2,106,149
|
|
|
$
|
4,905,138
|
|
|
Goodwill
|
|
$
|
83,550
|
|
|
$
|
91,932
|
|
|
$
|
175,482
|
|
|
|
|
Insurance
|
|
Reinsurance
|
|
Total
|
|
||||||
Revenues
|
|
|
|
|
|
|
|
||||||
Gross premiums written
|
|
$
|
2,085,901
|
|
|
$
|
1,234,960
|
|
|
$
|
3,320,861
|
|
|
Ceded premiums written
|
|
(1,205,528
|
)
|
|
(164,863
|
)
|
|
(1,370,391
|
)
|
|
|||
Net premiums written
|
|
880,373
|
|
|
1,070,097
|
|
|
1,950,470
|
|
|
|||
Net premiums earned
|
|
824,552
|
|
|
1,153,901
|
|
|
1,978,453
|
|
|
|||
Other underwriting loss
|
|
—
|
|
|
(3,694
|
)
|
|
(3,694
|
)
|
|
|||
|
|
824,552
|
|
|
1,150,207
|
|
|
1,974,759
|
|
|
|||
Expenses
|
|
|
|
|
|
|
|
||||||
Net losses and loss expenses
|
|
500,867
|
|
|
416,241
|
|
|
917,108
|
|
|
|||
Acquisition expenses
|
|
80,252
|
|
|
267,633
|
|
|
347,885
|
|
|
|||
General and administrative expenses
|
|
140,012
|
|
|
119,779
|
|
|
259,791
|
|
|
|||
|
|
721,131
|
|
|
803,653
|
|
|
1,524,784
|
|
|
|||
Underwriting income
|
|
$
|
103,421
|
|
|
$
|
346,554
|
|
|
449,975
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net investment income
|
|
|
|
|
|
113,826
|
|
|
|||||
Corporate expenses
|
|
|
|
|
|
(114,429
|
)
|
|
|||||
Net foreign exchange losses
|
|
|
|
|
|
(26,964
|
)
|
|
|||||
Net realized and unrealized gains
|
|
|
|
|
|
12,660
|
|
|
|||||
Net impairment losses recognized in earnings
|
|
|
|
|
|
(3,715
|
)
|
|
|||||
Amortization of intangibles
|
|
|
|
|
|
(30,620
|
)
|
|
|||||
Interest expense
|
|
|
|
|
|
(41,260
|
)
|
|
|||||
Income before income taxes
|
|
|
|
|
|
$
|
359,473
|
|
|
||||
|
|
|
|
|
|
|
|
||||||
Net loss ratio
|
|
60.8
|
%
|
|
36.0
|
%
|
|
46.4
|
%
|
|
|||
Acquisition expense ratio
|
|
9.7
|
%
|
|
23.2
|
%
|
|
17.6
|
%
|
|
|||
General and administrative expense ratio
|
|
17.0
|
%
|
|
10.4
|
%
|
|
18.9
|
%
|
(1)
|
|||
Combined ratio
|
|
87.5
|
%
|
|
69.6
|
%
|
|
82.9
|
%
|
|
|||
|
|
|
|
|
|
|
|
||||||
Reserve for losses and loss expenses
|
|
$
|
2,493,894
|
|
|
$
|
2,016,521
|
|
|
$
|
4,510,415
|
|
|
Goodwill
|
|
$
|
84,525
|
|
|
$
|
91,930
|
|
|
$
|
176,455
|
|
|
|
|
Insurance
|
|
Reinsurance
|
|
Total
|
|
||||||
Revenues
|
|
|
|
|
|
|
|
||||||
Gross premiums written
|
|
$
|
1,716,128
|
|
|
$
|
1,177,948
|
|
|
$
|
2,894,076
|
|
|
Ceded premiums written
|
|
(855,722
|
)
|
|
(104,148
|
)
|
|
(959,870
|
)
|
|
|||
Net premiums written
|
|
860,406
|
|
|
1,073,800
|
|
|
1,934,206
|
|
|
|||
Net premiums earned
|
|
833,912
|
|
|
1,030,066
|
|
|
1,863,978
|
|
|
|||
Other underwriting loss
|
|
—
|
|
|
(5,786
|
)
|
|
(5,786
|
)
|
|
|||
|
|
833,912
|
|
|
1,024,280
|
|
|
1,858,192
|
|
|
|||
Expenses
|
|
|
|
|
|
|
|
||||||
Net losses and loss expenses
|
|
594,561
|
|
|
375,601
|
|
|
970,162
|
|
|
|||
Acquisition expenses
|
|
65,368
|
|
|
254,145
|
|
|
319,513
|
|
|
|||
General and administrative expenses
|
|
148,475
|
|
|
98,912
|
|
|
247,387
|
|
|
|||
|
|
808,404
|
|
|
728,658
|
|
|
1,537,062
|
|
|
|||
Underwriting income
|
|
$
|
25,508
|
|
|
$
|
295,622
|
|
|
321,130
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net investment income
|
|
|
|
|
|
131,543
|
|
|
|||||
Corporate expenses
|
|
|
|
|
|
(66,200
|
)
|
|
|||||
Net foreign exchange losses
|
|
|
|
|
|
(3,839
|
)
|
|
|||||
Net realized and unrealized gains
|
|
|
|
|
|
14,283
|
|
|
|||||
Net impairment losses recognized in earnings
|
|
|
|
|
|
(625
|
)
|
|
|||||
Amortization of intangibles
|
|
|
|
|
|
(6,484
|
)
|
|
|||||
Interest expense
|
|
|
|
|
|
(40,968
|
)
|
|
|||||
Income before income taxes
|
|
|
|
|
|
$
|
348,840
|
|
|
||||
|
|
|
|
|
|
|
|
||||||
Net loss ratio
|
|
71.4
|
%
|
|
36.4
|
%
|
|
52.1
|
%
|
|
|||
Acquisition expense ratio
|
|
7.8
|
%
|
|
24.7
|
%
|
|
17.1
|
%
|
|
|||
General and administrative expense ratio
|
|
17.7
|
%
|
|
9.6
|
%
|
|
16.8
|
%
|
(1)
|
|||
Combined ratio
|
|
96.9
|
%
|
|
70.7
|
%
|
|
86.0
|
%
|
|
|||
|
|
|
|
|
|
|
|
||||||
Reserve for losses and loss expenses
|
|
$
|
2,123,772
|
|
|
$
|
1,723,087
|
|
|
$
|
3,846,859
|
|
|
Goodwill
|
|
$
|
47,925
|
|
|
$
|
43,313
|
|
|
$
|
91,238
|
|
|
Business Segment
|
|
2016
|
|
2015
|
|
2014
|
||||||
Insurance
|
|
|
|
|
|
|
||||||
Agriculture
|
|
$
|
760,877
|
|
|
$
|
840,445
|
|
|
$
|
866,025
|
|
Casualty and other specialty
|
|
657,558
|
|
|
514,203
|
|
|
396,113
|
|
|||
Professional lines
|
|
461,552
|
|
|
344,482
|
|
|
263,538
|
|
|||
Property, marine/energy and aviation
|
|
690,507
|
|
|
386,771
|
|
|
190,452
|
|
|||
Total Insurance
|
|
2,570,494
|
|
|
2,085,901
|
|
|
1,716,128
|
|
|||
Reinsurance
|
|
|
|
|
|
|
||||||
Catastrophe
|
|
506,300
|
|
|
311,914
|
|
|
343,213
|
|
|||
Property
|
|
250,447
|
|
|
209,392
|
|
|
287,326
|
|
|||
Casualty
|
|
245,092
|
|
|
176,506
|
|
|
159,533
|
|
|||
Professional lines
|
|
256,337
|
|
|
248,610
|
|
|
174,656
|
|
|||
Specialty
|
|
373,500
|
|
|
288,538
|
|
|
213,220
|
|
|||
Total Reinsurance
|
|
1,631,676
|
|
|
1,234,960
|
|
|
1,177,948
|
|
|||
Total
|
|
$
|
4,202,170
|
|
|
$
|
3,320,861
|
|
|
$
|
2,894,076
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
United States
|
|
$
|
2,823,950
|
|
|
$
|
2,305,301
|
|
|
$
|
2,054,431
|
|
Worldwide
|
|
794,289
|
|
|
566,664
|
|
|
456,078
|
|
|||
Europe
|
|
265,100
|
|
|
209,729
|
|
|
172,077
|
|
|||
Asia
|
|
105,838
|
|
|
75,165
|
|
|
38,442
|
|
|||
Japan
|
|
82,864
|
|
|
58,524
|
|
|
45,618
|
|
|||
Australasia
|
|
49,727
|
|
|
41,309
|
|
|
61,994
|
|
|||
Other
|
|
80,402
|
|
|
64,169
|
|
|
65,436
|
|
|||
Total
|
|
$
|
4,202,170
|
|
|
$
|
3,320,861
|
|
|
$
|
2,894,076
|
|
|
|
Goodwill
|
|
Intangible
assets with
indefinite
lives
|
|
Intangible
assets with
finite lives
|
|
Total
|
||||||||
Net balance at December 31, 2014
|
|
$
|
91,238
|
|
|
$
|
11,779
|
|
|
$
|
50,388
|
|
|
$
|
153,405
|
|
Additions
(1)
|
|
87,367
|
|
|
57,600
|
|
|
293,218
|
|
|
438,185
|
|
||||
Amortization
|
|
—
|
|
|
—
|
|
|
(30,620
|
)
|
|
(30,620
|
)
|
||||
Foreign currency translation
|
|
(2,150
|
)
|
|
(2,738
|
)
|
|
(2,122
|
)
|
|
(7,010
|
)
|
||||
Net balance at December 31, 2015
|
|
$
|
176,455
|
|
|
$
|
66,641
|
|
|
$
|
310,864
|
|
|
$
|
553,960
|
|
Additions
|
|
(973
|
)
|
|
—
|
|
|
11
|
|
|
(962
|
)
|
||||
Amortization
|
|
—
|
|
|
—
|
|
|
(84,624
|
)
|
|
(84,624
|
)
|
||||
Net balance at December 31, 2016
|
|
$
|
175,482
|
|
|
$
|
66,641
|
|
|
$
|
226,251
|
|
|
$
|
468,374
|
|
|
|
|
|
|
|
|
|
|
||||||||
Gross balance
|
|
$
|
177,632
|
|
|
$
|
74,829
|
|
|
$
|
431,271
|
|
|
$
|
683,732
|
|
Accumulated amortization
|
|
—
|
|
|
—
|
|
|
(202,898
|
)
|
|
(202,898
|
)
|
||||
Accumulated impairment losses
|
|
—
|
|
|
(5,450
|
)
|
|
—
|
|
|
(5,450
|
)
|
||||
Accumulated foreign currency translation
|
|
(2,150
|
)
|
|
(2,738
|
)
|
|
(2,122
|
)
|
|
(7,010
|
)
|
||||
Net balance
|
|
$
|
175,482
|
|
|
$
|
66,641
|
|
|
$
|
226,251
|
|
|
$
|
468,374
|
|
Broker
|
|
2016
|
|
2015
|
|
2014
|
|||
Marsh & McLennan Companies, Inc.
|
|
20.9
|
%
|
|
19.8
|
%
|
|
19.1
|
%
|
Aon Benfield
|
|
14.3
|
%
|
|
12.8
|
%
|
|
13.2
|
%
|
Willis Companies
|
|
8.9
|
%
|
|
9.2
|
%
|
|
10.6
|
%
|
Total of largest brokers
|
|
44.1
|
%
|
|
41.8
|
%
|
|
42.9
|
%
|
Year ending December 31,
|
Amount
|
||
2017
|
$
|
15,895
|
|
2018
|
19,945
|
|
|
2019
|
22,420
|
|
|
2020
|
21,060
|
|
|
2021
|
19,099
|
|
|
2022 and thereafter
|
103,443
|
|
|
|
$
|
201,862
|
|
|
|
2016
|
|
2015
|
||
Preferred shares
|
|
|
|
|
||
Authorized – $1.00 par value each
|
|
9,200
|
|
|
9,209,200
|
|
Issued, outstanding and fully paid:
|
|
|
|
|
||
Series B preferred shares - $1.00 par value each; aggregate liquidation preference nil (2015 - $230,000)
|
|
—
|
|
|
9,200,000
|
|
Series C preferred shares – $1.00 par value each; aggregate liquidation preference $230,000 (2015 - $230,000)
|
|
9,200
|
|
|
9,200
|
|
|
|
9,200
|
|
|
9,209,200
|
|
Common shares
|
|
|
|
|
||
Authorized - $1.00 par value each
|
|
120,000,000
|
|
|
120,000,000
|
|
Issued, outstanding and fully paid:
|
|
|
|
|
||
Ordinary common shares - $1.00 par value each
|
|
67,627,901
|
|
|
66,797,991
|
|
|
|
For the Year Ended December 31, 2016
|
||||||||||||||
|
|
Losses on
cash flow hedges
|
|
Unrealized (losses)
gains on available for sale
securities
|
|
Foreign currency translation
adjustments
|
|
Total
|
||||||||
Beginning balance
|
|
$
|
(1,678
|
)
|
|
$
|
(12,638
|
)
|
|
$
|
(32,318
|
)
|
|
$
|
(46,634
|
)
|
Other comprehensive (loss) income before reclassifications
|
|
—
|
|
|
54,287
|
|
|
(86,324
|
)
|
|
(32,037
|
)
|
||||
Amounts reclassified from accumulated other
comprehensive loss
(1)
|
|
88
|
|
|
19,834
|
|
|
—
|
|
|
19,922
|
|
||||
Net current period other comprehensive loss
|
|
88
|
|
|
74,121
|
|
|
(86,324
|
)
|
|
(12,115
|
)
|
||||
Ending balance
|
|
$
|
(1,590
|
)
|
|
$
|
61,483
|
|
|
$
|
(118,642
|
)
|
|
$
|
(58,749
|
)
|
(1)
|
All amounts are net of tax.
|
|
|
For the Year Ended December 31, 2015
|
||||||||||||||
|
|
Losses on
cash flow hedges
|
|
Unrealized (losses)
gains on available for sale
securities
|
|
Foreign currency translation
adjustments
|
|
Total
|
||||||||
Beginning balance
|
|
$
|
(1,766
|
)
|
|
$
|
86,100
|
|
|
$
|
(7,628
|
)
|
|
$
|
76,706
|
|
Other comprehensive (loss) income before reclassifications
|
|
—
|
|
|
(65,941
|
)
|
|
(24,690
|
)
|
|
(90,631
|
)
|
||||
Amounts reclassified from accumulated other
comprehensive loss
(1)
|
|
88
|
|
|
(32,797
|
)
|
|
—
|
|
|
(32,709
|
)
|
||||
Net current period other comprehensive loss
|
|
88
|
|
|
(98,738
|
)
|
|
(24,690
|
)
|
|
(123,340
|
)
|
||||
Ending balance
|
|
$
|
(1,678
|
)
|
|
$
|
(12,638
|
)
|
|
$
|
(32,318
|
)
|
|
$
|
(46,634
|
)
|
(1)
|
All amounts are net of tax.
|
For the Year Ended December 31, 2016
|
||||||
Details about accumulated other
comprehensive loss components
|
|
Amount reclassified
from accumulated
other comprehensive
loss
|
|
Affected line item in the Consolidated Statements
of Income and Comprehensive Income
|
||
Losses on cash flow hedges - Debt
|
|
$
|
88
|
|
|
Interest expense
|
|
|
88
|
|
|
Total before income taxes
|
|
|
|
—
|
|
|
Income tax expense
|
|
|
|
$
|
88
|
|
|
Total net of income taxes
|
|
|
|
|
|
||
Unrealized holding losses (gains) on available for sale securities
|
|
$
|
7,984
|
|
|
Net realized and unrealized (losses) gains
|
|
|
10,769
|
|
|
Net impairment losses recognized in earnings
|
|
|
|
18,753
|
|
|
Total before income taxes
|
|
|
|
1,081
|
|
|
Income tax expense
|
|
|
|
$
|
19,834
|
|
|
Total net of income taxes
|
For the Year Ended December 31, 2015
|
||||||
Details about accumulated other
comprehensive loss components
|
|
Amount reclassified
from accumulated
other comprehensive
loss
|
|
Affected line item in the Consolidated Statements
of Income and Comprehensive Income
|
||
Losses on cash flow hedges - Debt
|
|
$
|
88
|
|
|
Interest expense
|
|
|
88
|
|
|
Total before income taxes
|
|
|
|
—
|
|
|
Income tax expense
|
|
|
|
$
|
88
|
|
|
Total net of income taxes
|
|
|
|
|
|
||
Unrealized holding losses (gains) on available for sale securities
|
|
$
|
(37,245
|
)
|
|
Net realized and unrealized (losses) gains
|
|
|
3,715
|
|
|
Net impairment losses recognized in earnings
|
|
|
|
(33,530
|
)
|
|
Total before income taxes
|
|
|
|
733
|
|
|
Income tax benefit
|
|
|
|
$
|
(32,797
|
)
|
|
Total net of income taxes
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Numerator:
|
|
|
|
|
|
|
||||||
Net income available to common and participating common shareholders
|
|
$
|
333,218
|
|
|
$
|
311,345
|
|
|
$
|
315,700
|
|
Less amount allocated to participating common shareholders
(1)
|
|
(6,973
|
)
|
|
(8,749
|
)
|
|
(9,118
|
)
|
|||
Net income allocated to common shareholders
|
|
$
|
326,245
|
|
|
$
|
302,596
|
|
|
$
|
306,582
|
|
Denominator:
|
|
|
|
|
|
|
||||||
Weighted average shares - basic
|
|
65,991,947
|
|
|
52,707,390
|
|
|
43,368,062
|
|
|||
Share equivalents:
|
|
|
|
|
|
|
||||||
Options
|
|
65,351
|
|
|
118,392
|
|
|
47,111
|
|
|||
Restricted shares and restricted share units
|
|
78,075
|
|
|
2,721
|
|
|
70
|
|
|||
Weighted average shares - diluted
|
|
66,135,373
|
|
|
52,828,503
|
|
|
43,415,243
|
|
|||
|
|
|
|
|
|
|
||||||
Basic earnings per common share
|
|
$
|
4.94
|
|
|
$
|
5.74
|
|
|
$
|
7.07
|
|
Diluted earnings per common share
|
|
$
|
4.93
|
|
|
$
|
5.73
|
|
|
$
|
7.06
|
|
(1)
|
Represents earnings and dividends attributable to holders of unvested restricted shares and restricted share units issued under the Company's stock compensation plans that are considered participating. In periods of loss, no losses are allocated to participating common shareholders (unvested restricted shares and restricted share units).
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Dividends declared per Series A preferred share
|
|
$
|
—
|
|
|
$
|
1.9375
|
|
|
$
|
1.9375
|
|
Dividends declared per Series B preferred share
|
|
$
|
0.8646
|
|
|
$
|
1.8750
|
|
|
$
|
1.8750
|
|
Dividends declared per Series C preferred share
|
|
$
|
1,680.10
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Dividends declared per common share
|
|
$
|
1.52
|
|
|
$
|
1.40
|
|
|
$
|
1.36
|
|
|
|
For the year ended December 31, 2016
|
|||||||||||
Options Outstanding
|
|
Number of
Options
|
|
Weighted
Average
Exercise Price
|
|
Weighted
Average
Remaining
Contractual Life
(years)
|
|
Aggregate
Intrinsic Value
|
|||||
Beginning of year
|
|
320,000
|
|
|
$
|
48.20
|
|
|
|
|
|
||
Granted
|
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
|
(160,000
|
)
|
|
48.20
|
|
|
|
|
|
|||
Forfeited
|
|
—
|
|
|
—
|
|
|
|
|
|
|||
Outstanding, end of year
|
|
160,000
|
|
|
$
|
48.20
|
|
|
6.41
|
|
$
|
7,072
|
|
Exercisable and vested options, end of year
|
|
—
|
|
|
$
|
—
|
|
|
N/A
|
|
$
|
—
|
|
|
|
Number of
Shares/Units
|
|
Aggregate
Intrinsic Value
|
|||
Unvested, beginning of year
|
|
1,663,582
|
|
|
|
||
Granted
|
|
638,217
|
|
|
|
||
Settled
|
|
(769,445
|
)
|
|
|
||
Forfeited
|
|
(65,638
|
)
|
|
|
||
Unvested, end of year
|
|
1,466,716
|
|
|
|
||
Outstanding, end of year
|
|
1,466,716
|
|
|
$
|
135,525
|
|
Statutory capital
|
|
Bermuda
|
|
United States
|
|
U.K.
(1)
|
|
Singapore
|
||||||||||||||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||||||||
Required statutory capital
|
|
$
|
1,614,465
|
|
|
$
|
1,276,453
|
|
|
$
|
350,947
|
|
|
$
|
281,905
|
|
|
$
|
184,799
|
|
|
$
|
84,086
|
|
|
$
|
3,461
|
|
|
$
|
3,524
|
|
Actual statutory capital
|
|
4,525,290
|
|
|
4,307,249
|
|
|
810,704
|
|
|
768,791
|
|
|
451,257
|
|
|
538,265
|
|
|
59,025
|
|
|
49,842
|
|
Statutory net income (loss)
|
|
Bermuda
|
|
United States
|
|
U.K.
|
|
Singapore
|
||||||||
Year ended December 31, 2016
|
|
$
|
486,254
|
|
|
$
|
64,688
|
|
|
$
|
79,912
|
|
|
$
|
10,460
|
|
Year ended December 31, 2015
|
|
417,298
|
|
|
70,398
|
|
|
969
|
|
|
17,542
|
|
||||
Year ended December 31, 2014
|
|
453,127
|
|
|
28,450
|
|
|
4,135
|
|
|
4,111
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Current income tax expense
|
|
$
|
(10,993
|
)
|
|
$
|
(6,262
|
)
|
|
$
|
(1,804
|
)
|
Deferred income tax benefit
|
|
11,174
|
|
|
1,900
|
|
|
1,414
|
|
|||
Income tax benefit (expense)
|
|
$
|
181
|
|
|
$
|
(4,362
|
)
|
|
$
|
(390
|
)
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Computed expected tax expense
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Tax expense effect on foreign taxes
|
|
(26,149
|
)
|
|
(8,071
|
)
|
|
(1,661
|
)
|
|||
Change in valuation allowance
|
|
26,330
|
|
|
3,709
|
|
|
1,271
|
|
|||
Income tax benefit (expense)
|
|
$
|
181
|
|
|
$
|
(4,362
|
)
|
|
$
|
(390
|
)
|
|
|
2016
|
|
2015
|
||||
Deferred income tax assets:
|
|
|
|
|
||||
Unearned premiums
|
|
$
|
28,523
|
|
|
$
|
25,172
|
|
Loss reserves
|
|
26,594
|
|
|
27,370
|
|
||
Net operating loss carryforward
|
|
66,315
|
|
|
92,844
|
|
||
Deferred compensation
|
|
26,451
|
|
|
25,268
|
|
||
Deferred interest
|
|
48,359
|
|
|
46,568
|
|
||
Unrealized investment losses
|
|
1,803
|
|
|
1,568
|
|
||
Realized investment losses
|
|
4,010
|
|
|
4,972
|
|
||
Other
|
|
3,830
|
|
|
11,077
|
|
||
Total deferred income tax assets
|
|
205,885
|
|
|
234,839
|
|
||
Deferred income tax liabilities:
|
|
|
|
|
||||
Deferred acquisition costs
|
|
(1,325
|
)
|
|
(8,179
|
)
|
||
Unrealized foreign exchange gains
|
|
—
|
|
|
(4,087
|
)
|
||
Temporary differences related to acquisition
|
|
(29,033
|
)
|
|
(35,461
|
)
|
||
Start up costs
|
|
(1,989
|
)
|
|
(1,565
|
)
|
||
Other
|
|
(10,002
|
)
|
|
(7,561
|
)
|
||
Total deferred income tax liabilities
|
|
(42,349
|
)
|
|
(56,853
|
)
|
||
Valuation allowance
|
|
(104,808
|
)
|
|
(131,138
|
)
|
||
Net deferred income tax asset
|
|
$
|
58,728
|
|
|
$
|
46,848
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
U.S. (domestic)
|
|
$
|
40,872
|
|
|
$
|
95,649
|
|
|
$
|
60,112
|
|
Non-U.S. (foreign)
(1)
|
|
340,094
|
|
|
263,824
|
|
|
288,728
|
|
|||
Income before income taxes
|
|
$
|
380,966
|
|
|
$
|
359,473
|
|
|
$
|
348,840
|
|
(1)
|
The Company's non-U.S. (foreign) operating subsidiaries write business that is exposed to risks originating in the United States.
|
|
|
Quarter Ended
March 31, 2016 |
|
Quarter Ended
June 30, 2016 |
|
Quarter Ended
September 30, 2016 |
|
Quarter Ended
December 31, 2016 |
||||||||
Net premiums earned
|
|
$
|
553,191
|
|
|
$
|
599,608
|
|
|
$
|
610,156
|
|
|
$
|
600,705
|
|
Net investment income
|
|
11,181
|
|
|
43,977
|
|
|
62,236
|
|
|
59,196
|
|
||||
Net realized and unrealized gains (losses)
|
|
13,787
|
|
|
6,347
|
|
|
13,405
|
|
|
(45,958
|
)
|
||||
Net impairment losses recognized in earnings
|
|
(623
|
)
|
|
(9,841
|
)
|
|
(183
|
)
|
|
(122
|
)
|
||||
Subtotal
|
|
$
|
577,536
|
|
|
$
|
640,091
|
|
|
$
|
685,614
|
|
|
$
|
613,821
|
|
Net losses and loss expenses
|
|
$
|
243,328
|
|
|
$
|
376,112
|
|
|
$
|
331,462
|
|
|
$
|
370,150
|
|
Acquisition, general and administrative, and corporate expenses
|
|
$
|
187,838
|
|
|
$
|
178,870
|
|
|
$
|
201,081
|
|
|
$
|
192,546
|
|
Net foreign exchange gains
|
|
$
|
(11,729
|
)
|
|
$
|
(32,751
|
)
|
|
$
|
(18,576
|
)
|
|
$
|
(11,628
|
)
|
Net income
|
|
$
|
124,644
|
|
|
$
|
87,628
|
|
|
$
|
139,400
|
|
|
$
|
29,475
|
|
Net income attributable to non-controlling interests
|
|
(9,063
|
)
|
|
(3,714
|
)
|
|
(5,679
|
)
|
|
(5,674
|
)
|
||||
Net income available to Endurance Holdings
|
|
$
|
115,581
|
|
|
$
|
83,914
|
|
|
$
|
133,721
|
|
|
$
|
23,801
|
|
Preferred dividends
|
|
(9,203
|
)
|
|
(7,293
|
)
|
|
(3,651
|
)
|
|
(3,652
|
)
|
||||
Net income available to Endurance Holdings' common and participating common shareholders
|
|
$
|
106,378
|
|
|
$
|
76,621
|
|
|
$
|
130,070
|
|
|
$
|
20,149
|
|
Basic earnings per share
|
|
$
|
1.58
|
|
|
$
|
1.14
|
|
|
$
|
1.93
|
|
|
$
|
0.30
|
|
Diluted earnings per share
|
|
$
|
1.58
|
|
|
$
|
1.14
|
|
|
$
|
1.92
|
|
|
$
|
0.30
|
|
|
|
Quarter Ended
March 31, 2015 |
|
Quarter Ended
June 30, 2015 |
|
Quarter Ended
September 30, 2015 |
|
Quarter Ended
December 31, 2015 |
||||||||
Net premiums earned
|
|
$
|
389,859
|
|
|
$
|
458,135
|
|
|
$
|
557,003
|
|
|
$
|
573,456
|
|
Net investment income
|
|
41,861
|
|
|
32,252
|
|
|
16,533
|
|
|
23,180
|
|
||||
Net realized and unrealized gains (losses)
|
|
18,189
|
|
|
9,680
|
|
|
5,029
|
|
|
(20,238
|
)
|
||||
Net impairment losses recognized in earnings
|
|
(649
|
)
|
|
(424
|
)
|
|
(38
|
)
|
|
(2,604
|
)
|
||||
Subtotal
|
|
$
|
449,260
|
|
|
$
|
499,643
|
|
|
$
|
578,527
|
|
|
$
|
573,794
|
|
Net losses and loss expenses
|
|
$
|
171,936
|
|
|
$
|
239,122
|
|
|
$
|
263,993
|
|
|
$
|
242,057
|
|
Acquisition, general and administrative, and corporate expenses
|
|
$
|
149,251
|
|
|
$
|
152,570
|
|
|
$
|
225,558
|
|
|
$
|
194,726
|
|
Net foreign exchange losses (gains)
|
|
$
|
7,552
|
|
|
$
|
12,981
|
|
|
$
|
8,621
|
|
|
$
|
(2,190
|
)
|
Net income
|
|
$
|
108,479
|
|
|
$
|
84,206
|
|
|
$
|
54,530
|
|
|
$
|
107,896
|
|
Net income attributable to non-controlling interests
|
|
—
|
|
|
—
|
|
|
(2,707
|
)
|
|
(8,309
|
)
|
||||
Net income available to Endurance Holdings
|
|
$
|
108,479
|
|
|
$
|
84,206
|
|
|
$
|
51,823
|
|
|
$
|
99,587
|
|
Preferred dividends
|
|
(8,188
|
)
|
|
(8,188
|
)
|
|
(8,188
|
)
|
|
(8,186
|
)
|
||||
Net income available to Endurance Holdings' common and participating common shareholders
|
|
$
|
100,291
|
|
|
$
|
76,018
|
|
|
$
|
43,635
|
|
|
$
|
91,401
|
|
Basic earnings per share
|
|
$
|
2.24
|
|
|
$
|
1.69
|
|
|
$
|
0.73
|
|
|
$
|
1.36
|
|
Diluted earnings per share
|
|
$
|
2.23
|
|
|
$
|
1.68
|
|
|
$
|
0.73
|
|
|
$
|
1.36
|
|
(a)
|
The following is a list of certain documents filed as a part of this report:
|
(a)
|
Financial Statements. See Index to Consolidated Financial Statements on page
109
hereof.
|
(b)
|
Financial Statement Schedules. See Index to Consolidated Financial Statement Schedules on page
164
hereof.
|
(c)
|
Exhibits. See Exhibit Index beginning on page
175
hereof.
|
Date:
|
March 1, 2017
|
|
|
|
ENDURANCE SPECIALTY HOLDINGS LTD.
|
|
|
|
|
||
|
|
|
|
|
/s/ John R. Charman
|
|
|
|
|
|
Name: John R. Charman
|
|
|
|
|
|
Title: Chief Executive Officer
|
Signature
|
|
Title
|
|
Date
|
|
|
|
||
/s/ John R. Charman
|
|
Chief Executive Officer and Director
|
|
March 1, 2017
|
John R. Charman
|
|
(Principal Executive Officer)
|
|
|
|
|
|
||
/s/ Michael J. McGuire
|
|
Chief Financial Officer
|
|
March 1, 2017
|
Michael J. McGuire
|
|
(Principal Financial Officer)
|
|
|
|
|
|
||
/s/ Carrie L. Rosorea
|
|
Chief Accounting Officer
|
|
March 1, 2017
|
Carrie L. Rosorea
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
|
|
/s/ John T. Baily
|
|
Director
|
|
March 1, 2017
|
John T. Baily
|
|
|
|
|
|
|
|
||
/s/ Norman Barham
|
|
Director
|
|
March 1, 2017
|
Norman Barham
|
|
|
|
|
|
|
|
||
/s/ Galen R. Barnes
|
|
Director
|
|
March 1, 2017
|
Galen R. Barnes
|
|
|
|
|
|
|
|
||
/s/ William H. Bolinder
|
|
Director
|
|
March 1, 2017
|
William H. Bolinder
|
|
|
|
|
|
|
|
||
/s/ Philip M. Butterfield
|
|
Director
|
|
March 1, 2017
|
Philip M. Butterfield
|
|
|
|
|
|
|
|
|
|
/s/ Steven W. Carlsen
|
|
Director
|
|
March 1, 2017
|
Steven W. Carlsen
|
|
|
|
|
|
|
|
||
/s/ Morgan W. Davis
|
|
Director
|
|
March 1, 2017
|
Morgan W. Davis
|
|
|
|
|
|
|
|
|
|
/s/ Susan S. Fleming
|
|
Director
|
|
March 1, 2017
|
Susan S. Fleming
|
|
|
|
|
|
|
|
||
/s/ Nicholas C. Marsh
|
|
Director
|
|
March 1, 2017
|
Nicholas C. Marsh
|
|
|
|
|
|
|
|
|
|
/s/ Scott D. Moore
|
|
Director
|
|
March 1, 2017
|
Scott D. Moore
|
|
|
|
|
|
|
|
||
/s/ William J. Raver
|
|
Director
|
|
March 1, 2017
|
William J. Raver
|
|
|
|
|
|
|
|
||
/s/ Robert A. Spass
|
|
Director
|
|
March 1, 2017
|
Robert A. Spass
|
|
|
|
|
|
|
|
|
|
/s/ Ian Winchester
|
|
Director
|
|
March 1, 2017
|
Ian Winchester
|
|
|
|
|
|
|
Pages
|
I.
|
Summary of Investments other than Investments in Related Parties at December 31, 2016
|
|
II.
|
Condensed Financial Statement Information of the Registrant
|
|
III.
|
Supplementary Insurance Information for the years ended December 31, 2016, 2015 and 2014
|
|
IV.
|
Reinsurance for the years ended December 31, 2016, 2015 and 2014
|
|
V.
|
Valuation and Qualifying Accounts
|
|
VI.
|
Supplementary Information for Property and Casualty Insurance Underwriters for the years ended December 31, 2016, 2015 and 2014
|
|
|
Cost
(1)
|
|
Market Value
|
|
Amount at
Which Shown on
the Balance Sheet
|
||||||
Type of Investment:
|
|
|
|
|
|
|
||||||
Fixed Maturity Investments
|
|
|
|
|
|
|
||||||
U.S. government and government agencies and authorities
|
|
$
|
1,003,969
|
|
|
$
|
1,001,882
|
|
|
$
|
1,001,882
|
|
States, municipalities and political subdivisions
|
|
17,115
|
|
|
18,357
|
|
|
18,357
|
|
|||
Foreign governments
|
|
180,583
|
|
|
178,919
|
|
|
178,919
|
|
|||
Corporate bonds
|
|
2,120,463
|
|
|
2,151,610
|
|
|
2,151,610
|
|
|||
Mortgage-backed securities
|
|
|
|
|
|
|
||||||
Agency mortgage-backed securities
|
|
1,461,354
|
|
|
1,472,343
|
|
|
1,472,343
|
|
|||
Non-agency mortgage-backed securities
|
|
603,293
|
|
|
607,791
|
|
|
607,791
|
|
|||
Collateralized loan and debt obligations
|
|
369,126
|
|
|
371,256
|
|
|
371,256
|
|
|||
Asset-backed securities
|
|
509,595
|
|
|
510,663
|
|
|
510,663
|
|
|||
Total fixed maturity investments
|
|
$
|
6,265,498
|
|
|
$
|
6,312,821
|
|
|
$
|
6,312,821
|
|
Short-term investments
|
|
408,811
|
|
|
408,704
|
|
|
408,704
|
|
|||
Equity securities
|
|
477,778
|
|
|
501,141
|
|
|
501,141
|
|
|||
Other investments
|
|
470,299
|
|
|
588,308
|
|
|
588,308
|
|
|||
Total Investments
|
|
$
|
7,622,386
|
|
|
$
|
7,810,974
|
|
|
$
|
7,810,974
|
|
(1)
|
Investments in fixed maturity investments and short-term investments are shown at amortized cost.
|
|
|
2016
|
|
2015
|
||||
ASSETS
|
|
|
|
|
||||
Investment in subsidiary
|
|
$
|
5,296,821
|
|
|
$
|
5,683,801
|
|
Cash and cash equivalents
|
|
3,375
|
|
|
3,206
|
|
||
Amounts due from subsidiaries
|
|
513,621
|
|
|
105,497
|
|
||
Goodwill and intangible assets
|
|
45,710
|
|
|
51,938
|
|
||
Other assets
|
|
12,833
|
|
|
14,435
|
|
||
Total assets
|
|
$
|
5,872,360
|
|
|
$
|
5,858,877
|
|
LIABILITIES
|
|
|
|
|
||||
Debt
|
|
$
|
708,378
|
|
|
$
|
707,591
|
|
Other liabilities
|
|
21,849
|
|
|
27,214
|
|
||
Total liabilities
|
|
730,227
|
|
|
734,805
|
|
||
SHAREHOLDERS' EQUITY
|
|
|
|
|
||||
Preferred shares
|
|
|
|
|
||||
Series B and C, non-cumulative - 9,200 issued and outstanding (2015 - 9,209,200)
|
|
9
|
|
|
9,209
|
|
||
Common shares
|
|
|
|
|
||||
Common shares, ordinary - 67,627,901 issued and outstanding (2015 - 66,797,991)
|
|
67,628
|
|
|
66,798
|
|
||
Additional paid-in capital
|
|
1,961,917
|
|
|
2,145,836
|
|
||
Accumulated other comprehensive loss
|
|
(58,749
|
)
|
|
(46,634
|
)
|
||
Retained earnings
|
|
2,911,634
|
|
|
2,681,053
|
|
||
Total shareholders' equity available to Endurance Holdings
|
|
4,882,439
|
|
|
4,856,262
|
|
||
Non-controlling interests
|
|
259,694
|
|
|
267,810
|
|
||
Total shareholders' equity
|
|
5,142,133
|
|
|
5,124,072
|
|
||
Total liabilities and shareholders' equity
|
|
$
|
5,872,360
|
|
|
$
|
5,858,877
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Revenues
|
|
|
|
|
|
|
||||||
Net investment income
|
|
$
|
5
|
|
|
$
|
9
|
|
|
$
|
248
|
|
Net realized and unrealized gains
|
|
206
|
|
|
332
|
|
|
1,957
|
|
|||
Other income
|
|
10,200
|
|
|
10,200
|
|
|
10,200
|
|
|||
Total revenues
|
|
10,411
|
|
|
10,541
|
|
|
12,405
|
|
|||
Expenses
|
|
|
|
|
|
|
||||||
General and administrative expenses
|
|
41,879
|
|
|
93,237
|
|
|
61,325
|
|
|||
Amortization of intangibles
|
|
6,228
|
|
|
1,558
|
|
|
—
|
|
|||
Net foreign exchange (gains) losses
|
|
(20
|
)
|
|
5
|
|
|
(1
|
)
|
|||
Interest expense
|
|
43,833
|
|
|
41,188
|
|
|
40,968
|
|
|||
Total expenses
|
|
91,920
|
|
|
135,988
|
|
|
102,292
|
|
|||
Loss before income taxes and equity in net income of subsidiaries
|
|
(81,509
|
)
|
|
(125,447
|
)
|
|
(89,887
|
)
|
|||
Equity in net income of subsidiaries
|
|
462,656
|
|
|
480,558
|
|
|
438,337
|
|
|||
Net income
|
|
381,147
|
|
|
355,111
|
|
|
348,450
|
|
|||
Net income attributable to non-controlling interests
|
|
(24,130
|
)
|
|
(11,016
|
)
|
|
—
|
|
|||
Net income available to Endurance Holdings
|
|
357,017
|
|
|
344,095
|
|
|
348,450
|
|
|||
Preferred dividends
|
|
(23,799
|
)
|
|
(32,750
|
)
|
|
(32,750
|
)
|
|||
Net income available to Endurance Holdings' common and
participating common shareholders
|
|
$
|
333,218
|
|
|
$
|
311,345
|
|
|
$
|
315,700
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Cash flows used in operating activities:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
381,147
|
|
|
$
|
355,111
|
|
|
$
|
348,450
|
|
Adjustments to reconcile net income to net cash used in operating activities:
|
|
|
|
|
|
|
||||||
Depreciation and amortization
|
|
8,380
|
|
|
3,738
|
|
|
6,785
|
|
|||
Net realized and unrealized gains
|
|
(206
|
)
|
|
(332
|
)
|
|
(1,957
|
)
|
|||
Stock-based compensation expense
|
|
9,339
|
|
|
28,604
|
|
|
15,093
|
|
|||
Equity in net earnings of subsidiary
|
|
(462,656
|
)
|
|
(480,558
|
)
|
|
(438,337
|
)
|
|||
Other assets
|
|
327
|
|
|
(893
|
)
|
|
(177
|
)
|
|||
Other liabilities
|
|
(3,524
|
)
|
|
(17,377
|
)
|
|
1,626
|
|
|||
Net cash flows used in operating activities
|
|
(67,193
|
)
|
|
(111,707
|
)
|
|
(68,517
|
)
|
|||
Cash flows provided by investing activities:
|
|
|
|
|
|
|
||||||
Proceeds from sales and maturities of available for sale investments
|
|
—
|
|
|
—
|
|
|
26,094
|
|
|||
Purchases of available for sale investments
|
|
—
|
|
|
—
|
|
|
(24,137
|
)
|
|||
Contributions of capital made to subsidiaries
|
|
(4,655
|
)
|
|
—
|
|
|
—
|
|
|||
Dividends received from subsidiary
|
|
809,840
|
|
|
341,524
|
|
|
145,203
|
|
|||
Net amounts paid to subsidiaries
|
|
(379,632
|
)
|
|
35,383
|
|
|
14,819
|
|
|||
Purchases of fixed assets
|
|
—
|
|
|
(11,626
|
)
|
|
—
|
|
|||
Proceeds from disposals of fixed assets
|
|
—
|
|
|
6,606
|
|
|
19
|
|
|||
Net cash received for subsidiary acquisition
|
|
—
|
|
|
19,875
|
|
|
—
|
|
|||
Net cash flows provided by investing activities
|
|
425,553
|
|
|
391,762
|
|
|
161,998
|
|
|||
Cash flows used in financing activities:
|
|
|
|
|
|
|
||||||
Issuance of common shares
|
|
10,076
|
|
|
24,823
|
|
|
2,305
|
|
|||
Issuance of Series C, non-cumulative preferred shares
|
|
—
|
|
|
222,963
|
|
|
—
|
|
|||
Redemption of Series A and B, non-cumulative preferred shares
|
|
(230,000
|
)
|
|
(200,000
|
)
|
|
—
|
|
|||
Offering and registration costs paid
|
|
(319
|
)
|
|
(617
|
)
|
|
—
|
|
|||
Bridge facility costs paid
|
|
—
|
|
|
—
|
|
|
(4,750
|
)
|
|||
Settlement of restricted shares
|
|
(11,732
|
)
|
|
(14,535
|
)
|
|
(4,039
|
)
|
|||
Repayments of debt
|
|
—
|
|
|
(198,500
|
)
|
|
—
|
|
|||
Dividends paid on preferred shares
|
|
(23,799
|
)
|
|
(32,750
|
)
|
|
(32,750
|
)
|
|||
Dividends paid on common shares
|
|
(102,417
|
)
|
|
(78,473
|
)
|
|
(60,524
|
)
|
|||
Net cash flows used in financing activities
|
|
(358,191
|
)
|
|
(277,089
|
)
|
|
(99,758
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
169
|
|
|
2,966
|
|
|
(6,277
|
)
|
|||
Cash and cash equivalents, beginning of year
|
|
3,206
|
|
|
240
|
|
|
6,517
|
|
|||
Cash and cash equivalents, end of year
|
|
$
|
3,375
|
|
|
$
|
3,206
|
|
|
$
|
240
|
|
|
|
Insurance
|
|
Reinsurance
|
|
Total
|
||||||
Deferred Acquisition Costs
|
|
$
|
72,502
|
|
|
$
|
204,137
|
|
|
$
|
276,639
|
|
Reserve for Losses and Loss Expenses
|
|
2,798,989
|
|
|
2,106,149
|
|
|
4,905,138
|
|
|||
Unearned Premiums
|
|
1,124,359
|
|
|
870,317
|
|
|
1,994,676
|
|
|||
Net Premiums Earned
|
|
1,009,375
|
|
|
1,354,285
|
|
|
2,363,660
|
|
|||
Net Investment Income
(1)
|
|
—
|
|
|
—
|
|
|
176,590
|
|
|||
Net Losses and Loss Expenses
|
|
684,178
|
|
|
636,874
|
|
|
1,321,052
|
|
|||
Amortization of Deferred Acquisition Costs
|
|
149,763
|
|
|
310,720
|
|
|
460,483
|
|
|||
Other Operating Expenses
(2)
|
|
140,742
|
|
|
107,404
|
|
|
248,146
|
|
|||
Net Premiums Written
|
|
1,056,254
|
|
|
1,313,681
|
|
|
2,369,935
|
|
(1)
|
Because the Company does not manage its assets by segment, investment income is not allocated to the individual segments.
|
(2)
|
General and administrative expenses incurred by segments are allocated directly. Remaining general and administrative expenses not incurred by the segments are classified as corporate expenses and are not allocated to the individual business segments.
|
|
|
Insurance
|
|
Reinsurance
|
|
Total
|
||||||
Deferred Acquisition Costs
|
|
$
|
58,216
|
|
|
$
|
197,285
|
|
|
$
|
255,501
|
|
Reserve for Losses and Loss Expenses
|
|
2,493,894
|
|
|
2,016,521
|
|
|
4,510,415
|
|
|||
Unearned Premiums
|
|
902,152
|
|
|
886,996
|
|
|
1,789,148
|
|
|||
Net Premiums Earned
|
|
824,552
|
|
|
1,153,901
|
|
|
1,978,453
|
|
|||
Net Investment Income
(1)
|
|
—
|
|
|
—
|
|
|
113,826
|
|
|||
Net Losses and Loss Expenses
|
|
500,867
|
|
|
416,241
|
|
|
917,108
|
|
|||
Amortization of Deferred Acquisition Costs
|
|
80,252
|
|
|
267,633
|
|
|
347,885
|
|
|||
Other Operating Expenses
(2)
|
|
140,012
|
|
|
119,779
|
|
|
259,791
|
|
|||
Net Premiums Written
|
|
880,373
|
|
|
1,070,097
|
|
|
1,950,470
|
|
(1)
|
Because the Company does not manage its assets by segment, investment income is not allocated to the individual segments.
|
(2)
|
General and administrative expenses incurred by segments are allocated directly. Remaining general and administrative expenses not incurred by the segments are classified as corporate expenses and are not allocated to the individual business segments.
|
|
|
Insurance
|
|
Reinsurance
|
|
Total
|
||||||
Deferred Acquisition Costs
|
|
$
|
34,581
|
|
|
$
|
172,787
|
|
|
$
|
207,368
|
|
Reserve for Losses and Loss Expenses
|
|
2,123,772
|
|
|
1,723,087
|
|
|
3,846,859
|
|
|||
Unearned Premiums
|
|
642,779
|
|
|
611,740
|
|
|
1,254,519
|
|
|||
Net Premiums Earned
|
|
833,912
|
|
|
1,030,066
|
|
|
1,863,978
|
|
|||
Net Investment Income
(1)
|
|
—
|
|
|
—
|
|
|
131,543
|
|
|||
Net Losses and Loss Expenses
|
|
594,561
|
|
|
375,601
|
|
|
970,162
|
|
|||
Amortization of Deferred Acquisition Costs
|
|
65,368
|
|
|
254,145
|
|
|
319,513
|
|
|||
Other Operating Expenses
(2)
|
|
148,475
|
|
|
98,912
|
|
|
247,387
|
|
|||
Net Premiums Written
|
|
860,406
|
|
|
1,073,800
|
|
|
1,934,206
|
|
(1)
|
Because the Company does not manage its assets by segment, investment income is not allocated to the individual segments.
|
(2)
|
General and administrative expenses incurred by segments are allocated directly. Remaining general and administrative expenses not incurred by the segments are classified as corporate expenses and are not allocated to the individual business segments.
|
Premiums Written
|
|
Gross Amount
|
|
Ceded to
Other
Companies
|
|
Assumed
from Other
Companies
|
|
Net Amount
|
|
Percentage
of Amount
Assumed
to Net
|
|||||||||
Year ended December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Property and liability insurance
|
|
$
|
2,570,494
|
|
|
$
|
1,832,235
|
|
|
$
|
1,631,676
|
|
|
$
|
2,369,935
|
|
|
69
|
%
|
Year ended December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Property and liability insurance
|
|
$
|
2,085,901
|
|
|
$
|
1,370,391
|
|
|
$
|
1,234,960
|
|
|
$
|
1,950,470
|
|
|
63
|
%
|
Year ended December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Property and liability insurance
|
|
$
|
1,716,128
|
|
|
$
|
959,870
|
|
|
$
|
1,177,948
|
|
|
$
|
1,934,206
|
|
|
61
|
%
|
|
Balance at Beginning of Year
|
Charged to costs and expenses
|
Charged to other accounts
|
Deductions (1)
|
Balance at End of Year
|
|||||
December 31, 2016
|
|
|
|
|
|
|||||
Valuation allowance for deferred tax assets
|
131,138
|
|
—
|
|
—
|
|
26,330
|
|
104,808
|
|
December 31, 2015
|
|
|
|
|
|
|||||
Valuation allowance for deferred tax assets
|
121,409
|
|
—
|
|
13,300
|
|
3,571
|
|
131,138
|
|
December 31, 2014
|
|
|
|
|
|
|||||
Valuation allowance for deferred tax assets
|
122,680
|
|
—
|
|
—
|
|
1,271
|
|
121,409
|
|
(1)
|
Credited to the related asset account
|
|
|
Insurance
|
|
Reinsurance
|
|
Total
|
||||||
Deferred Acquisition Costs
|
|
$
|
72,502
|
|
|
$
|
204,137
|
|
|
$
|
276,639
|
|
Reserve for Losses and Loss Expenses
|
|
2,798,989
|
|
|
2,106,149
|
|
|
4,905,138
|
|
|||
Discount if any, Reserve for Losses and Loss Expenses
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Unearned Premiums
|
|
1,124,359
|
|
|
870,317
|
|
|
1,994,676
|
|
|||
Net Premiums Earned
|
|
1,009,375
|
|
|
1,354,285
|
|
|
2,363,660
|
|
|||
Net Investment Income
(1)
|
|
—
|
|
|
—
|
|
|
176,590
|
|
|||
Net Losses and Loss Expenses
|
|
|
|
|
|
|
||||||
Current Year
|
|
761,315
|
|
|
781,287
|
|
|
1,542,602
|
|
|||
Prior Year
|
|
(77,137
|
)
|
|
(144,413
|
)
|
|
(221,550
|
)
|
|||
Amortization of Deferred Acquisition Costs
|
|
149,763
|
|
|
310,720
|
|
|
460,483
|
|
|||
Paid Losses and Loss Expenses
|
|
592,018
|
|
|
593,872
|
|
|
1,185,890
|
|
|||
Net Premiums Written
|
|
1,056,254
|
|
|
1,313,681
|
|
|
2,369,935
|
|
(1)
|
Because the Company does not manage its assets by segment, investment income is not allocated to the individual segments.
|
|
|
Insurance
|
|
Reinsurance
|
|
Total
|
||||||
Deferred Acquisition Costs
|
|
$
|
58,216
|
|
|
$
|
197,285
|
|
|
$
|
255,501
|
|
Reserve for Losses and Loss Expenses
|
|
2,493,894
|
|
|
2,016,521
|
|
|
4,510,415
|
|
|||
Discount if any, Reserve for Losses and Loss Expenses
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Unearned Premiums
|
|
902,152
|
|
|
886,996
|
|
|
1,789,148
|
|
|||
Net Premiums Earned
|
|
824,552
|
|
|
1,153,901
|
|
|
1,978,453
|
|
|||
Net Investment Income
(1)
|
|
—
|
|
|
—
|
|
|
113,826
|
|
|||
Net Losses and Loss Expenses
|
|
|
|
|
|
|
||||||
Current Year
|
|
582,868
|
|
|
577,704
|
|
|
1,160,572
|
|
|||
Prior Year
|
|
(82,001
|
)
|
|
(161,463
|
)
|
|
(243,464
|
)
|
|||
Amortization of Deferred Acquisition Costs
|
|
80,252
|
|
|
267,633
|
|
|
347,885
|
|
|||
Paid Losses and Loss Expenses
|
|
626,606
|
|
|
507,031
|
|
|
1,133,637
|
|
|||
Net Premiums Written
|
|
880,373
|
|
|
1,070,097
|
|
|
1,950,470
|
|
(1)
|
Because the Company does not manage its assets by segment, investment income is not allocated to the individual segments.
|
|
|
Insurance
|
|
Reinsurance
|
|
Total
|
||||||
Deferred Acquisition Costs
|
|
$
|
34,581
|
|
|
$
|
172,787
|
|
|
$
|
207,368
|
|
Reserve for Losses and Loss Expenses
|
|
2,123,772
|
|
|
1,723,087
|
|
|
3,846,859
|
|
|||
Discount if any, Reserve for Losses and Loss Expenses
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Unearned Premiums
|
|
642,779
|
|
|
611,740
|
|
|
1,254,519
|
|
|||
Net Premiums Earned
|
|
833,912
|
|
|
1,030,066
|
|
|
1,863,978
|
|
|||
Net Investment Income
(1)
|
|
—
|
|
|
—
|
|
|
131,543
|
|
|||
Net Losses and Loss Expenses
|
|
|
|
|
|
|
||||||
Current Year
|
|
675,131
|
|
|
528,846
|
|
|
1,203,977
|
|
|||
Prior Year
|
|
(80,570
|
)
|
|
(153,245
|
)
|
|
(233,815
|
)
|
|||
Amortization of Deferred Acquisition Costs
|
|
65,368
|
|
|
254,145
|
|
|
319,513
|
|
|||
Paid Losses and Loss Expenses
|
|
700,576
|
|
|
457,636
|
|
|
1,158,212
|
|
|||
Net Premiums Written
|
|
860,406
|
|
|
1,073,800
|
|
|
1,934,206
|
|
(1)
|
Because the Company does not manage its assets by segment, investment income is not allocated to the individual segments.
|
Exhibit
Number
|
|
Description of Document
|
|
|
|
2.1
|
|
Agreement and Plan of Merger, dated as of March 31, 2015, by and among Montpelier Re Holdings Ltd., Endurance Specialty Holdings Ltd. and Millhill Holdings Ltd., incorporated herein by reference to Exhibit 2.1 to the Current Report on Form 8-K filed on April 1, 2015.
|
|
|
|
2.2
|
|
Agreement and Plan of Merger, dated as of October 5, 2016, by and among Endurance Specialty Holdings Ltd., Sompo Holdings, Inc. and Volcano International Limited. Incorporated herein by reference to Exhibit 2.1 to the Current Report on Form 8-K filed on October 5, 2016.
|
|
|
|
2.3
|
|
Amendment Agreement, dated as of December 1, 2016, by and among Endurance Specialty Holdings Ltd., Sompo Holdings, Inc. and Volcano International Limited. Incorporated herein by reference to Exhibit 2.1 to the Current Report on Form 8-K filed on December 2, 2016.
|
|
|
|
3.1
|
|
Memorandum of Association. Incorporated herein by reference to Exhibit 3.1 to Amendment No. 1 to the Registration Statement on Form S-1 filed on January 28, 2003.
|
|
|
|
3.2
|
|
Certificate of Deposit of Memorandum of Increase of Share Capital. Incorporated herein by reference to Exhibit 3.2 to the Annual Report on Form 10-K for the Year Ended December 31, 2004.
|
|
|
|
3.3
|
|
Amended and Restated Bye-laws, dated as of May 8, 2013. Incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K filed on May 9, 2013.
|
|
|
|
4.1
|
|
Specimen Ordinary Share Certificate. Incorporated herein by reference to Exhibit 4.1 to Amendment No. 2 to the Registration Statement on Form S-1 filed on February 10, 2003.
|
|
|
|
4.2
|
|
Certificate of Designations of 6.350% Non-Cumulative Preferred Shares, Series C, of Endurance Specialty Holdings Ltd. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed on November 24, 2015).
|
|
|
|
4.3
|
|
Specimen 6.350% Non-Cumulative Preferred Shares, Series C (incorporated by reference to Exhibit 4.3 to the Current Report on Form 8-K filed on November 24, 2015).
|
|
|
|
4.4
|
|
Form of Depositary Receipt (incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on November 24, 2015).
|
|
|
|
4.5
|
|
Deposit Agreement, dated November 24, 2015, among Endurance Specialty Holdings Ltd., Computershare Inc., Computershare Trust Company, N.A. and the holders from time to time of the depositary receipts described therein (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on November 24, 2015).
|
|
|
|
4.6
|
|
Form of 7% Senior Note due July 15, 2034 (included in Exhibit 4.2 to the Current Report on Form 8-K on July 15, 2004). Incorporated herein by reference to Exhibit 4.3 to the Current Report on Form 8-K filed on July 15, 2004.
|
|
|
|
4.7
|
|
Indenture, dated as of July 15, 2004, between the Company, as Issuer, and The Bank of New York, as Trustee. Incorporated herein by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on July 15, 2004.
|
|
|
|
4.8
|
|
First Supplemental Indenture, dated as of July 15, 2004, to the Indenture, dated as of July 15, 2004, between the Company, as Issuer, and The Bank of New York, as Trustee. Incorporated herein by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on July 15, 2004.
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4.9
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Third Supplemental Indenture, by and between Endurance Specialty Holdings Ltd. and The Bank of New York Mellon, formerly known as the Bank of New York, dated March 26, 2010. Incorporated herein by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on March 29, 2010.
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4.10
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Third Supplemental Indenture, dated as of July 31, 2015, between Millhill Holdings Ltd. and The Bank of New York Mellon Trust Company, National Association. Incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on August 3, 2015.
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4.11
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Fourth Supplemental Indenture, dated as of July 31, 2015 between Endurance Specialty Holdings Ltd. and The Bank of New York Mellon Trust Company, National Association. Incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on August 3, 2015.
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10.1
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Credit Agreement, dated as of March 23, 2016, by and among Endurance Specialty Holdings Ltd., various designated subsidiary borrowers, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent, incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on March 28, 2016.
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10.2
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Pledge and Security Agreement, dated as of March 23, 2016, by and among Endurance Specialty Holdings Ltd., various designated subsidiary borrowers, Deutsche Bank Trust Company Americas, as collateral agent, Deutsche Bank Trust Company Americas, as custodian and JPMorgan Chase Bank, N.A., as administrative agent, incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on March 28, 2016.
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10.3
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Account Control Agreement, dated as of March 23, 2016, by and among Endurance Specialty Holdings Ltd., various designated subsidiary borrowers, Deutsche Bank Trust Company Americas, as collateral agent, and Deutsche Bank Trust Company Americas, as custodian, incorporated herein by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on March 28, 2016.
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10.4
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Underwriting Agreement, by and between Endurance Specialty Holdings Ltd. and Banc of America Securities LLC, as representative of the several underwriters named therein, dated March 23, 2010. Incorporated herein by reference to Exhibit 1.1 to the Current Report on Form 8-K filed on March 29, 2010.
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10.5
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2007 Equity Incentive Plan. Incorporated herein by reference to Exhibit 10.4 to the Quarterly Report on Form 10-Q for the quarter ended March 31, 2007.**
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10.6
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Amendment No. 1 to 2007 Equity Incentive Plan. Incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter ended June 30, 2008.**
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10.7
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Amendment No. 2 to 2007 Equity Incentive Plan. Incorporated herein by reference to Exhibit 10.12 to the Annual Report on Form 10-K for the year ended December 31, 2010.**
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10.8
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Form of Restricted Share Agreement. Incorporated herein by reference to Exhibit 10.9 to the Annual Report on Form 10-K for the year ended December 31, 2015.**
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10.9
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Form of Long-Term Incentive Agreement. Incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q for the period ended September 30, 2015.**
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10.10
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Form of Performance Based Restricted Share Agreement. Incorporated herein by reference to Exhibit 10.11 to the Annual Report on Form 10-K for the year ended December 31, 2015.**
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10.11
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Form of Swiss Restricted Share Unit Agreement. Incorporated herein by reference to Exhibit 10.12 to the Annual Report on Form 10-K for the year ended December 31, 2015.**
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10.12
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Form of Director Restricted Share Agreement. Incorporated herein by reference to Exhibit 10.13 to the Annual Report on Form 10-K for the year ended December 31, 2015.**
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10.13
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Form of Restricted Share Unit Assumption Agreement. Incorporated herein by reference to Exhibit 10.3 to Post-Effective Amendment No. 1 on Form S-8 to Form S-4 filed on August 3, 2015.**
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10.14
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2015 Employee Share Purchase Plan. Incorporated herein by reference to Exhibit 4.1 to the Registration Statement on Form S-8 filed on July 10, 2015.**
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10.15
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Employment Agreement, dated May 28, 2013, by and between the Company and John R. Charman. Incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on May 31, 2013.**
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10.16
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Restricted Share Agreement, dated May 28, 2013, by and between the company and John R. Charman. Incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on May 31, 2013.**
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10.17
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Option Agreement, dated May 28, 2013, by and between the Company and John R. Charman. Incorporated herein by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on May 31, 2013.**
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10.18
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Indemnification Agreement, dated May 28, 2013, by and between the Company and John R. Charman. Incorporated herein by reference to Exhibit 10.4 to the Current Report on Form 8-K filed on May 31, 2013.**
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10.19
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Share Purchase Agreement, dated May 28, 2013, by and between Dragon Global Holdings Ltd. and the Company. Incorporated herein by reference to Exhibit 10.5 to the Current Report on Form 8-K filed on May 31, 2013.
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10.20
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Share Purchase Agreement, dated May 28, 2013, by and between The Fortis Trust and the Company. Incorporated herein by reference to Exhibit 10.6 to the Current Report on Form 8-K filed on May 31, 2013.
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10.21
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Share Purchase Agreement, dated May 28, 2013, by and between The Prometheus Trust and the Company. Incorporated herein by reference to Exhibit 10.7 to the Current Report on Form 8-K filed on May 31, 2013.
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10.22
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Shareholders' Agreement, dated May 28, 2013, by and among John R. Charman, Dragon Global Holdings Ltd. and the Company. Incorporated herein by reference to Exhibit 10.8 to the Current Report on Form 8-K filed on May 31, 2013.
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10.23
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Amended and Restated Employment Agreement, dated October 5, 2016, by and among Endurance Specialty Holdings Ltd., Volcano International Limited and John R. Charman. Incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on October 5, 2016. **
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10.24
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Amended and Restated Indemnification Agreement, dated October 5, 2016, by and between Endurance Specialty Holdings Ltd. and John R. Charman. Incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on October 5, 2016. **
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10.25
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Form of Amended and Restated Employment Agreement. Incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on January 12, 2016.**
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10.26
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Form of Amended and Restated Employment Agreement. Incorporated herein by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on October 5, 2016. **
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10.27
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Amended and Restated Employment Agreement, dated January 27, 2016, by and between the Company and John A. Kuhn. Incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on February 2, 2016.**
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10.28
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Independent Contractor Agreement, dated April 1, 2016, by and between Endurance Services Limited and Jerome Faure, incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on April 5, 2016. **
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10.29
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Form of Amended and Restated Indemnification Agreement. Incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 12, 2016. **
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10.30
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Form of Amended and Restated Indemnification Agreement. Incorporated herein by reference to Exhibit 10.4 to the Current Report on Form 8-K filed on October 5, 2016. **
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10.31
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Amended and Restated Indemnification Agreement dated January 27, 2016, by and between the Company and John A. Kuhn. Incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on February 2, 2016. **
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10.32
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Form of Director Indemnification Agreement. Incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on December 24, 2008.**
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10.33
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Letter dated December 23, 2015 by and among Michael J. McGuire, Endurance Specialty Holdings Ltd. and Blue Capital Reinsurance Holdings Ltd. Incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on December 23, 2015.
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10.34
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Voting Agreement, dated as of March 31, 2015, by and among Endurance Specialty Holdings Ltd. and Charlesbank Equity Fund VII, Limited Partnership; CB Offshore Equity Fund VII, L.P.; CB Parallel Fund VII, Limited Partnership; Charlesbank Coinvestment Partners, Limited Partnership; and Charlesbank Equity Coinvestment Fund VII, Limited Partnership, incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on April 1, 2015.
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10.35
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Clawback Agreement for Long-Term Incentive Payment. **
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21.1
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Subsidiaries of the Registrant.
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23.1
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Consent of Independent Registered Public Accounting Firm.
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31.1
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Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Exchange Act.
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31.2
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Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Exchange Act.
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32
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Certifications Pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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101
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Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Condensed Consolidated Balance Sheets as at December 31, 2015 and December 31, 2014; (ii) the Condensed Consolidated Statements of Income and Comprehensive Income for the years ended December 31, 2015, 2014 and 2013; (iii) the Condensed Consolidated Statements of Changes in Shareholders' Equity for the years ended December 31, 2015 and 2014; (iv) the Condensed Consolidated Statements of Cash Flows for the years ended December 31, 2015, 2014 and 2013; and (v) the Notes to the Condensed Consolidated Financial Statements for the years ended December 31, 2015, 2014 and 2013.
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**
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Management contract or compensatory plan or arrangement.
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