EVEREST GROUP, LTD. - Annual Report: 2018 (Form 10-K)
Bermuda
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98-0365432
|
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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Securities registered pursuant to Section 12(b) of the Act:
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|||||||||
Title of Each Class
Common Shares, $.01 par value per share
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Name of Each Exchange on Which Registered
New York Stock Exchange
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YES
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X
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NO
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YES
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NO
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X
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YES
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X
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NO
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YES
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X
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NO
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Large accelerated filer
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X
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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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Emerging growth company
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YES
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NO
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X
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YES
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NO
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X
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Page
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||
PART I
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||
Item 1.
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Business
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1
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Item 1A.
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Risk Factors
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25
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Item 1B.
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Unresolved Staff Comments
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37
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Item 2.
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Properties
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38
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Item 3.
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Legal Proceedings
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38
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Item 4.
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Mine Safety Disclosures
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38
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PART II
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||
Item 5.
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Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities
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38
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Item 6.
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Selected Financial Data
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41
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Item 7.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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42
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Item 7A.
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Quantitative and Qualitative Disclosures About Market Risk
|
78
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Item 8.
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Financial Statements and Supplementary Data
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78
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Item 9.
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Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
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78
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Item 9A.
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Controls and Procedures
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78
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Item 9B.
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Other Information
|
79
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PART III
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||
Item 10.
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Directors, Executive Officers and Corporate Governance
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79
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Item 11.
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Executive Compensation
|
79
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Item 12.
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Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters
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79
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Item 13.
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Certain Relationships and Related Transactions, and Director Independence
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79
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Item 14.
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Principal Accountant Fees and Services
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80
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PART IV
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||
Item 15.
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Exhibits and Financial Statement Schedules
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80
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·
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Bermuda Re, a Bermuda insurance company and a direct subsidiary of Group, is registered in Bermuda as a Class 4 insurer
and long-term insurer and is authorized to write property and casualty and life and annuity business. Bermuda Re commenced business in the second half of 2000. Bermuda Re’s UK branch writes property and casualty
reinsurance to the United Kingdom and European markets. At December 31, 2018, Bermuda Re had shareholder’s equity of $3.1 billion.
|
·
|
Everest International Reinsurance, Ltd. (“Everest International”), a Bermuda insurance company and a direct subsidiary of
Group, is registered in Bermuda as a Class 4 insurer and is authorized to write property and casualty business. Through 2018, all of Everest International’s business has been inter-affiliate quota share reinsurance
assumed from Everest Re, the UK branch of Bermuda Re, Ireland Re and Ireland Insurance. In 2015, Everest International issued additional capital as part of a capital restructuring initiative within the Company to
support a planned increase in international business production, which includes supporting Group’s Lloyd’s of London Syndicate corporate member. At December 31, 2018, Everest International had shareholder’s equity of
$2.7 billion.
|
·
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Ireland Re, an Ireland reinsurance company and an indirect subsidiary of Group, is licensed to write non-life reinsurance,
both directly and through brokers, for the London and European markets.
|
·
|
Ireland Insurance, an Ireland insurance company and an indirect subsidiary of Group, is licensed to write insurance for
the European markets.
|
·
|
Everest Re, a Delaware insurance company and a direct subsidiary of Holdings, is a licensed property and casualty insurer
and/or reinsurer in all states, the District of Columbia, Puerto Rico and Guam and is authorized to conduct reinsurance business in Canada, Singapore and Brazil. Everest Re underwrites property and casualty reinsurance
for insurance and reinsurance companies in the U.S. and international markets. At December 31, 2018, Everest Re had statutory surplus of $3.7 billion.
|
·
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Everest Insurance Company of Canada (“Everest Canada”), a Canadian insurance company and direct subsidiary of Holdings
Ireland, is licensed to write property and casualty insurance in all Canadian provinces.
|
·
|
Everest National Insurance Company (“Everest National”), a Delaware insurance company and a direct subsidiary of Everest
Re, is licensed in 50 states, the District of Columbia and Puerto Rico and is authorized to write property and casualty insurance on an admitted basis in the jurisdictions in which it is licensed. The majority of
Everest National’s business is reinsured by its parent, Everest Re.
|
·
|
Everest Indemnity Insurance Company (“Everest Indemnity”), a Delaware insurance company and a direct subsidiary of Everest
Re, writes excess and surplus lines insurance business in the U.S. on a non-admitted basis. Excess and surplus lines insurance is specialty property and liability coverage that an insurer not licensed to write insurance
in a particular jurisdiction is permitted to provide to insureds when the specific specialty coverage is unavailable from admitted insurers. Everest Indemnity is licensed in Delaware and is eligible to write business on
a non-admitted basis in all other states, the District of Columbia and Puerto Rico. The majority of Everest Indemnity’s business is reinsured by its parent, Everest Re.
|
·
|
Everest Security Insurance Company (“Everest Security”), a Georgia insurance company and a direct subsidiary of Everest
Re, writes property and casualty insurance on an admitted basis in Georgia and Alabama and is approved as an eligible surplus lines insurer in Delaware. The majority of Everest Security’s business is reinsured by its
parent, Everest Re.
|
·
|
Everest International Assurance, Ltd. (“Everest Assurance”), a Bermuda company and a direct subsidiary of Holdings is
registered in Bermuda as a Class 3A general business insurer and as a Class C long-term insurer. Everest Assurance has made a one-time election under section 953(d) of the U.S. Internal Revenue Code to be a U.S. income
tax paying “Controlled Foreign Corporation.” By making this election, Everest Assurance is authorized to write life reinsurance and casualty reinsurance in both Bermuda and the U.S.
|
·
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Everest Denali, a Delaware insurance company and a direct subsidiary of Everest Re, is licensed to write property and
casualty insurance in 49 states and the District of Columbia.
|
·
|
Everest Premier, a Delaware insurance company and a direct subsidiary of Everest Re, is licensed to write property and
casualty insurance in 49 states and the District of Columbia.
|
·
|
Heartland, a Kansas based managing general agent and a direct subsidiary of Holdings, was acquired on January 2, 2011.
Heartland specializes in crop insurance, which is written mainly through Everest National. Effective August 24, 2016, the Company sold Heartland to CGB. The operating results of Heartland for the period owned are
included within the Company’s financial statements.
|
Gross Written Premiums by Segment
|
||||||||||||||||||||||||||||||||||||||||
Years Ended December 31, 2018
|
||||||||||||||||||||||||||||||||||||||||
(Dollars in millions)
|
2018
|
2017
|
2016
|
2015
|
2014
|
|||||||||||||||||||||||||||||||||||
U.S. Reinsurance
|
||||||||||||||||||||||||||||||||||||||||
Property
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
$
|
1,069.6
|
12.6
|
%
|
$
|
848.4
|
11.8
|
%
|
$
|
495.2
|
8.2
|
%
|
$
|
591.3
|
10.0
|
%
|
$
|
665.7
|
11.6
|
%
|
||||||||||||||||||||
Excess
|
1,031.9
|
12.2
|
%
|
1,085.2
|
15.1
|
%
|
1,054.2
|
17.5
|
%
|
1,065.3
|
18.1
|
%
|
887.6
|
15.4
|
%
|
|||||||||||||||||||||||||
Casualty
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
702.2
|
8.3
|
%
|
460.7
|
6.4
|
%
|
378.2
|
6.3
|
%
|
319.9
|
5.4
|
%
|
382.4
|
6.6
|
%
|
|||||||||||||||||||||||||
Excess
|
210.6
|
2.5
|
%
|
198.7
|
2.8
|
%
|
198.2
|
3.3
|
%
|
171.3
|
2.9
|
%
|
218.8
|
3.8
|
%
|
|||||||||||||||||||||||||
Total (2)
|
3,014.3
|
35.6
|
%
|
2,593.0
|
36.1
|
%
|
2,125.8
|
35.2
|
%
|
2,147.9
|
36.5
|
%
|
2,154.5
|
37.4
|
%
|
|||||||||||||||||||||||||
International
|
||||||||||||||||||||||||||||||||||||||||
Property
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
$
|
679.8
|
8.0
|
%
|
$
|
577.5
|
8.1
|
%
|
671.9
|
11.1
|
%
|
699.3
|
11.9
|
%
|
846.0
|
14.7
|
%
|
|||||||||||||||||||||||
Excess
|
424.7
|
5.0
|
%
|
377.9
|
5.3
|
%
|
337.4
|
5.6
|
%
|
411.2
|
7.0
|
%
|
488.1
|
8.5
|
%
|
|||||||||||||||||||||||||
Casualty
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
281.0
|
3.3
|
%
|
236.4
|
3.3
|
%
|
111.7
|
1.9
|
%
|
113.4
|
1.9
|
%
|
152.9
|
2.7
|
%
|
|||||||||||||||||||||||||
Excess
|
158.4
|
1.9
|
%
|
125.0
|
1.7
|
%
|
109.7
|
1.8
|
%
|
110.4
|
1.9
|
%
|
116.5
|
2.0
|
%
|
|||||||||||||||||||||||||
Total (2)
|
1,543.9
|
18.2
|
%
|
1,316.7
|
18.4
|
%
|
1,230.7
|
20.4
|
%
|
1,334.2
|
22.6
|
%
|
1,603.6
|
27.8
|
%
|
|||||||||||||||||||||||||
Bermuda
|
||||||||||||||||||||||||||||||||||||||||
Property
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
$
|
422.6
|
5.0
|
%
|
$
|
294.0
|
4.1
|
%
|
261.1
|
4.3
|
%
|
265.8
|
4.5
|
%
|
252.4
|
4.4
|
%
|
|||||||||||||||||||||||
Excess
|
229.4
|
2.7
|
%
|
222.0
|
3.1
|
%
|
175.5
|
2.9
|
%
|
165.3
|
2.8
|
%
|
183.8
|
3.2
|
%
|
|||||||||||||||||||||||||
Casualty
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
773.7
|
9.1
|
%
|
407.7
|
5.7
|
%
|
318.6
|
5.3
|
%
|
281.0
|
4.8
|
%
|
178.5
|
3.1
|
%
|
|||||||||||||||||||||||||
Excess
|
240.6
|
2.8
|
%
|
281.2
|
3.9
|
%
|
135.2
|
2.2
|
%
|
165.2
|
2.8
|
%
|
171.7
|
3.0
|
%
|
|||||||||||||||||||||||||
Total (2)
|
1,666.3
|
19.7
|
%
|
1,205.0
|
16.8
|
%
|
890.4
|
14.8
|
%
|
877.3
|
14.9
|
%
|
786.4
|
13.7
|
%
|
|||||||||||||||||||||||||
Total Reinsurance
|
||||||||||||||||||||||||||||||||||||||||
Property
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
$
|
2,172.0
|
25.6
|
%
|
$
|
1,719.9
|
24.0
|
%
|
1,428.2
|
23.7
|
%
|
1,556.4
|
26.4
|
%
|
1,764.1
|
30.6
|
%
|
|||||||||||||||||||||||
Excess
|
1,686.0
|
19.9
|
%
|
1,685.1
|
23.5
|
%
|
1,567.1
|
26.0
|
%
|
1,641.8
|
27.9
|
%
|
1,559.5
|
27.1
|
%
|
|||||||||||||||||||||||||
Casualty
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
1,756.9
|
20.7
|
%
|
1,104.8
|
15.4
|
%
|
808.5
|
13.4
|
%
|
714.3
|
12.1
|
%
|
713.8
|
12.4
|
%
|
|||||||||||||||||||||||||
Excess
|
609.7
|
7.2
|
%
|
604.9
|
8.4
|
%
|
443.1
|
7.3
|
%
|
446.9
|
7.6
|
%
|
507.0
|
8.8
|
%
|
|||||||||||||||||||||||||
Total (2)
|
6,224.6
|
73.4
|
%
|
5,114.7
|
71.3
|
%
|
4,246.9
|
70.4
|
%
|
4,359.4
|
74.0
|
%
|
4,544.5
|
78.9
|
%
|
|||||||||||||||||||||||||
Insurance
|
||||||||||||||||||||||||||||||||||||||||
Property
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
$
|
645.9
|
7.6
|
%
|
$
|
725.1
|
10.1
|
%
|
716.4
|
11.9
|
%
|
592.2
|
10.1
|
%
|
414.0
|
7.2
|
%
|
|||||||||||||||||||||||
Excess
|
-
|
0.0
|
%
|
-
|
0.0
|
%
|
-
|
0.0
|
%
|
-
|
0.0
|
%
|
-
|
0.0
|
%
|
|||||||||||||||||||||||||
Casualty
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
1,604.6
|
18.9
|
%
|
1,334.1
|
18.6
|
%
|
1,070.6
|
17.7
|
%
|
940.1
|
16.0
|
%
|
804.4
|
14.0
|
%
|
|||||||||||||||||||||||||
Excess
|
-
|
0.0
|
%
|
-
|
0.0
|
%
|
-
|
0.0
|
%
|
-
|
0.0
|
%
|
-
|
0.0
|
%
|
|||||||||||||||||||||||||
Total (2)
|
2,250.6
|
26.6
|
%
|
2,059.2
|
28.7
|
%
|
1,787.0
|
29.6
|
%
|
1,532.3
|
26.0
|
%
|
1,218.4
|
21.1
|
%
|
|||||||||||||||||||||||||
Total Company
|
||||||||||||||||||||||||||||||||||||||||
Property
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
$
|
2,818.0
|
33.2
|
%
|
$
|
2,445.1
|
34.1
|
%
|
2,144.6
|
35.5
|
%
|
2,148.6
|
36.5
|
%
|
2,178.1
|
37.8
|
%
|
|||||||||||||||||||||||
Excess
|
1,686.0
|
19.9
|
%
|
1,685.1
|
23.5
|
%
|
1,567.1
|
26.0
|
%
|
1,641.8
|
27.9
|
%
|
1,559.5
|
27.1
|
%
|
|||||||||||||||||||||||||
Casualty
|
||||||||||||||||||||||||||||||||||||||||
Pro Rata (1)
|
3,361.5
|
39.7
|
%
|
2,438.9
|
34.0
|
%
|
1,879.1
|
31.1
|
%
|
1,654.3
|
28.1
|
%
|
1,518.2
|
26.3
|
%
|
|||||||||||||||||||||||||
Excess
|
609.7
|
7.2
|
%
|
604.9
|
8.4
|
%
|
443.1
|
7.3
|
%
|
446.9
|
7.6
|
%
|
507.0
|
8.8
|
%
|
|||||||||||||||||||||||||
Total (2)
|
8,475.2
|
100.0
|
%
|
7,173.9
|
100.0
|
%
|
$
|
6,033.9
|
100.0
|
%
|
$
|
5,891.7
|
100.0
|
%
|
$
|
5,762.9
|
100.0
|
%
|
||||||||||||||||||||||
__________________
|
||||||||||||||||||||||||||||||||||||||||
(1) For purposes of the presentation above, pro rata includes all insurance and reinsurance attaching to the
first dollar of loss incurred by the ceding company.
|
||||||||||||||||||||||||||||||||||||||||
(2) Certain totals and subtotals may not reconcile due to rounding.
|
·
|
selective underwriting practices;
|
·
|
diversifying its risk portfolio by geographic area and by types and classes of business;
|
·
|
limiting its aggregate catastrophe loss exposure in any particular geographic zone and contiguous zones;
|
·
|
purchasing reinsurance and/or retrocessional protection to the extent that such coverage can be secured cost-effectively.
See “Reinsurance and Retrocession Arrangements”.
|
Return Periods (in years)
|
1 in 20
|
1 in 50
|
1 in 100
|
1 in 250
|
1 in 500
|
1 in 1,000
|
||||||||||||||||||
Exceeding Probability
|
5.0%
|
2.0%
|
1.0%
|
0.4%
|
0.2%
|
0.1%
|
||||||||||||||||||
(Dollars in millions)
|
||||||||||||||||||||||||
Zone/ Peril
|
||||||||||||||||||||||||
Southeast U.S., Wind
|
$
|
639
|
$
|
888
|
$
|
1,036
|
$
|
1,315
|
$
|
1,583
|
$
|
2,444
|
||||||||||||
California, Earthquake
|
136
|
470
|
781
|
1,132
|
1,302
|
1,571
|
||||||||||||||||||
Texas, Wind
|
158
|
467
|
769
|
1,077
|
1,152
|
1,236
|
Return Periods (in years)
|
1 in 20
|
1 in 50
|
1 in 100
|
1 in 250
|
1 in 500
|
1 in 1,000
|
||||||||||||||||||
Exceeding Probability
|
5.0%
|
2.0%
|
1.0%
|
0.4%
|
0.2%
|
0.1%
|
||||||||||||||||||
(Dollars in millions)
|
||||||||||||||||||||||||
Zone/ Peril
|
||||||||||||||||||||||||
Southeast U.S., Wind
|
$
|
440
|
$
|
636
|
$
|
759
|
$
|
986
|
$
|
1,198
|
$
|
1,883
|
||||||||||||
California, Earthquake
|
111
|
374
|
626
|
903
|
1,045
|
1,255
|
||||||||||||||||||
Texas, Wind
|
121
|
354
|
578
|
809
|
871
|
941
|
Years Ended December 31,
|
||||||||||||
(Dollars in millions)
|
2018
|
2017
|
2016
|
|||||||||
Gross reserves at beginning of period
|
$
|
11,884.3
|
$
|
10,312.3
|
$
|
9,951.8
|
||||||
Incurred related to:
|
||||||||||||
Current year
|
5,264.3
|
4,816.0
|
3,434.9
|
|||||||||
Prior years
|
387.1
|
(293.4
|
)
|
(295.3
|
)
|
|||||||
Total incurred losses
|
5,651.4
|
4,522.6
|
3,139.6
|
|||||||||
Paid related to:
|
||||||||||||
Current year
|
1,700.7
|
1,280.6
|
745.6
|
|||||||||
Prior years
|
3,011.2
|
2,062.6
|
2,043.0
|
|||||||||
Total paid losses
|
4,711.9
|
3,343.2
|
2,788.6
|
|||||||||
Foreign exchange/translation adjustment
|
(111.7
|
)
|
170.9
|
(99.9
|
)
|
|||||||
Change in reinsurance receivables on unpaid losses and LAE
|
407.0
|
221.8
|
109.4
|
|||||||||
Gross reserves at end of period
|
$
|
13,119.1
|
$
|
11,884.3
|
$
|
10,312.3
|
||||||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
||||||||||||
(Dollars in millions)
|
2018
|
2017
|
2016
|
|||||||||
Gross reserves
|
$
|
347.5
|
$
|
449.0
|
$
|
441.1
|
||||||
Reinsurance receivable
|
(86.0
|
)
|
(130.9
|
)
|
(122.0
|
)
|
||||||
Net reserves
|
$
|
261.5
|
$
|
318.1
|
$
|
319.1
|
||||||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
||||||||||||
(Dollars in millions)
|
2018
|
2017
|
2016
|
|||||||||
Balance at beginning of year
|
$
|
51.0
|
$
|
55.1
|
$
|
58.9
|
||||||
Liabilities assumed
|
0.1
|
0.1
|
0.2
|
|||||||||
Adjustments to reserves
|
0.8
|
(0.4
|
)
|
0.3
|
||||||||
Benefits paid in the current year
|
(5.1
|
)
|
(3.7
|
)
|
(4.3
|
)
|
||||||
Balance at end of year
|
$
|
46.8
|
$
|
51.0
|
$
|
55.1
|
||||||
(Some amounts may not reconcile due to rounding.)
|
December 31,
|
||||||||||||||||||||
Pre-tax
|
Pre-tax
|
|||||||||||||||||||
Pre-tax
|
Pre-tax
|
Realized Net
|
Unrealized Net
|
|||||||||||||||||
Average
|
Investment
|
Effective
|
Capital (Losses)
|
Capital Gains
|
||||||||||||||||
(Dollars in millions)
|
Investments (1)
|
Income (2)
|
Yield
|
Gains (3)
|
(Losses)
|
|||||||||||||||
2018
|
$
|
18,430.8
|
$
|
581.2
|
3.15
|
%
|
$
|
(127.1
|
)
|
$
|
(250.9
|
)
|
||||||||
2017
|
17,840.2
|
542.9
|
3.04
|
%
|
153.2
|
(94.8
|
)
|
|||||||||||||
2016
|
16,967.2
|
473.1
|
2.79
|
%
|
(7.2
|
)
|
96.6
|
|||||||||||||
2015
|
16,692.8
|
473.5
|
2.84
|
%
|
(184.1
|
)
|
(194.0
|
)
|
||||||||||||
2014
|
16,487.5
|
530.5
|
3.22
|
%
|
84.0
|
20.3
|
(1)
|
Average of the beginning and ending carrying values of investments and cash, less net funds held, future policy benefit reserve,
and non-interest bearing cash. Bonds, common stock and redeemable and non-redeemable preferred stocks are carried at market value. Common stock, which are actively managed, are carried at fair value.
|
(2)
|
After investment expenses, excluding realized net capital gains (losses).
|
(3)
|
Included in 2018, 2017, 2016, 2015 and 2014 are fair value re-measurements of ($67.3) million, $139.0 million, $59.1 million,
($45.6) million and $121.7 million, respectively.
|
At December 31, 2018
|
||||||||||||||||||||
Amortized
|
Unrealized
|
Unrealized
|
Market
|
OTTI in AOCI
|
||||||||||||||||
(Dollars in thousands)
|
Cost
|
Appreciation
|
Depreciation
|
Value
|
(a)
|
|||||||||||||||
Fixed maturity securities
|
||||||||||||||||||||
U.S. Treasury securities and obligations of
|
||||||||||||||||||||
U.S. government agencies and corporations
|
$
|
2,629.5
|
$
|
16.8
|
$
|
(15.2
|
)
|
$
|
2,631.1
|
$
|
-
|
|||||||||
Obligations of U.S. states and political subdivisions
|
490.0
|
12.9
|
(2.8
|
)
|
500.1
|
0.4
|
||||||||||||||
Corporate securities
|
5,538.6
|
48.5
|
(141.6
|
)
|
5,445.5
|
1.7
|
||||||||||||||
Asset-backed securities
|
545.4
|
0.2
|
(5.5
|
)
|
540.1
|
-
|
||||||||||||||
Mortgage-backed securities
|
||||||||||||||||||||
Commercial
|
329.9
|
2.2
|
(5.4
|
)
|
326.7
|
-
|
||||||||||||||
Agency residential
|
1,832.8
|
7.3
|
(43.8
|
)
|
1,796.3
|
-
|
||||||||||||||
Non-agency residential
|
10.2
|
-
|
-
|
10.2
|
-
|
|||||||||||||||
Foreign government securities
|
1,335.3
|
34.7
|
(55.8
|
)
|
1,314.2
|
0.1
|
||||||||||||||
Foreign corporate securities
|
2,694.9
|
64.0
|
(97.8
|
)
|
2,661.1
|
0.3
|
||||||||||||||
Total fixed maturity securities
|
$
|
15,406.6
|
$
|
186.6
|
$
|
(367.9
|
)
|
$
|
15,225.3
|
$
|
2.5
|
|||||||||
Equity securities
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||||
(Some amounts may not reconcile due to rounding.)
|
At December 31, 2017
|
||||||||||||||||||||
Amortized
|
Unrealized
|
Unrealized
|
Market
|
OTTI in AOCI
|
||||||||||||||||
(Dollars in thousands)
|
Cost
|
Appreciation
|
Depreciation
|
Value
|
(a)
|
|||||||||||||||
Fixed maturity securities
|
||||||||||||||||||||
U.S. Treasury securities and obligations of
|
||||||||||||||||||||
U.S. government agencies and corporations
|
$
|
1,541.0
|
$
|
9.8
|
$
|
(14.1
|
)
|
$
|
1,536.7
|
$
|
-
|
|||||||||
Obligations of U.S. states and political subdivisions
|
563.8
|
22.1
|
(0.4
|
)
|
585.5
|
-
|
||||||||||||||
Corporate securities
|
5,658.4
|
81.8
|
(41.2
|
)
|
5,699.0
|
2.5
|
||||||||||||||
Asset-backed securities
|
532.5
|
0.9
|
(2.0
|
)
|
531.4
|
-
|
||||||||||||||
Mortgage-backed securities
|
||||||||||||||||||||
Commercial
|
235.8
|
0.6
|
(2.4
|
)
|
234.0
|
-
|
||||||||||||||
Agency residential
|
2,236.3
|
10.4
|
(35.8
|
)
|
2,210.9
|
-
|
||||||||||||||
Non-agency residential
|
0.5
|
-
|
(0.1
|
)
|
0.4
|
-
|
||||||||||||||
Foreign government securities
|
1,305.1
|
43.8
|
(34.8
|
)
|
1,314.1
|
0.2
|
||||||||||||||
Foreign corporate securities
|
2,616.2
|
77.0
|
(48.4
|
)
|
2,644.8
|
0.9
|
||||||||||||||
Total fixed maturity securities
|
$
|
14,689.6
|
$
|
246.4
|
$
|
(179.2
|
)
|
$
|
14,756.8
|
$
|
3.6
|
|||||||||
Equity securities
|
$
|
130.3
|
$
|
2.6
|
$
|
(3.4
|
)
|
$
|
129.5
|
$
|
-
|
|||||||||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
||||||||||||||||
2018
|
2017
|
|||||||||||||||
(Dollars in millions)
|
Market
|
Percent of
|
Market
|
Percent of
|
||||||||||||
Rating Agency Credit Quality Distribution:
|
Value
|
Total
|
Value
|
Total
|
||||||||||||
AAA
|
$
|
6,698.1
|
44.0
|
%
|
$
|
5,909.1
|
40.0
|
%
|
||||||||
AA
|
2,345.0
|
15.4
|
%
|
2,544.9
|
17.2
|
%
|
||||||||||
A
|
3,082.2
|
20.2
|
%
|
3,374.0
|
22.9
|
%
|
||||||||||
BBB
|
1,783.7
|
11.7
|
%
|
1,637.0
|
11.1
|
%
|
||||||||||
BB
|
609.0
|
4.0
|
%
|
640.0
|
4.3
|
%
|
||||||||||
B
|
270.0
|
1.8
|
%
|
333.3
|
2.3
|
%
|
||||||||||
Rated below B
|
18.6
|
0.1
|
%
|
29.9
|
0.2
|
%
|
||||||||||
Other
|
418.7
|
2.8
|
%
|
288.6
|
2.0
|
%
|
||||||||||
Total
|
$
|
15,225.3
|
100.0
|
%
|
$
|
14,756.8
|
100.0
|
%
|
||||||||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
||||||||||||||||
2018
|
2017
|
|||||||||||||||
Market
|
Percent of
|
Market
|
Percent of
|
|||||||||||||
(Dollars in millions)
|
Value
|
Total
|
Value
|
Total
|
||||||||||||
Fixed maturity securities - available for sale
|
||||||||||||||||
Due in one year or less
|
$
|
1,330.5
|
8.7
|
%
|
$
|
1,050.1
|
7.1
|
%
|
||||||||
Due after one year through five years
|
8,016.5
|
52.7
|
%
|
7,554.3
|
51.2
|
%
|
||||||||||
Due after five years through ten years
|
2,413.9
|
15.9
|
%
|
2,231.5
|
15.1
|
%
|
||||||||||
Due after ten years
|
791.1
|
5.2
|
%
|
944.2
|
6.4
|
%
|
||||||||||
Asset-backed securities
|
540.1
|
3.5
|
%
|
531.4
|
3.6
|
%
|
||||||||||
Mortgage-backed securities
|
2,133.2
|
14.0
|
%
|
2,445.3
|
16.6
|
%
|
||||||||||
Total fixed maturity securities
|
$
|
15,225.3
|
100.0
|
%
|
$
|
14,756.8
|
100.0
|
%
|
||||||||
(Some amounts may not reconcile due to rounding.)
|
Operating Subsidiary:
|
A.M. Best
|
Standard & Poor's
|
Moody's
|
|||
Everest Re
|
A+ (Superior)
|
A+ (Strong)
|
A1 (upper-medium)
|
|||
Bermuda Re
|
A+ (Superior)
|
A+ (Strong)
|
A1 (upper-medium)
|
|||
Ireland Re
|
A+ (Superior)
|
A+ (Strong)
|
Not Rated
|
|||
Everest National
|
A+ (Superior)
|
A+ (Strong)
|
Not Rated
|
|||
Everest Indemnity
|
A+ (Superior)
|
A+ (Strong)
|
Not Rated
|
|||
Everest Security
|
A+ (Superior)
|
Not Rated
|
Not Rated
|
|||
Everest International Assurance, Ltd.
|
A+ (Superior)
|
A (Strong )
|
Not Rated
|
|||
Everest Canada
|
A+ (Superior)
|
A+ (Strong)
|
Not Rated
|
|||
Everest International
|
A+ (Superior)
|
Not Rated
|
Not Rated
|
|||
Everest Denali
|
A+ (Superior)
|
Not Rated
|
Not Rated
|
|||
Everest Premier
|
A+ (Superior)
|
Not Rated
|
Not Rated
|
|||
Ireland Insurance
|
Not Rated
|
A+ (Strong)
|
Not Rated
|
A.M. Best
|
Standard & Poor's
|
Moody's
|
||||||
Senior Notes
|
a-
|
(Strong)
|
A-
|
(Strong)
|
Baa1
|
(Medium Grade)
|
||
Long Term Notes
|
bbb
|
(Adequate)
|
BBB
|
(Adequate)
|
Baa2
|
(Medium Grade)
|
Calendar year:
|
Pre-tax catastrophe losses
|
|||
(Dollars in millions)
|
||||
2018
|
$
|
1,800.2
|
||
2017
|
1,472.6
|
|||
2016
|
301.2
|
|||
2015
|
53.8
|
|||
2014
|
56.3
|
Calendar year:
|
Effect on pre-tax net income
|
||||
(Dollars in millions)
|
|||||
2018
|
$
|
387.1
|
decrease
|
||
2017
|
293.4
|
increase
|
|||
2016
|
295.3
|
increase
|
|||
2015
|
65.1
|
increase
|
|||
2014
|
39.7
|
increase
|
2018
|
2017
|
2016
|
2015
|
2014
|
|
Percentage of ceded written premiums to gross written premiums
|
12.5%
|
13.0%
|
12.6%
|
12.0%
|
10.9%
|
At
|
||||||||
(Dollars in millions)
|
December 31, 2018
|
% of Total
|
||||||
Mortgage-backed securities:
|
||||||||
Commercial
|
$
|
326.7
|
1.8
|
%
|
||||
Agency residential
|
1,796.3
|
9.7
|
%
|
|||||
Non-agency residential
|
10.2
|
0.1
|
%
|
|||||
Other asset-backed
|
540.1
|
2.9
|
%
|
|||||
Total asset-backed
|
2,673.3
|
14.5
|
%
|
|||||
Other fixed income
|
12,552.0
|
68.1
|
%
|
|||||
Total fixed income, at market value
|
15,225.3
|
82.6
|
%
|
|||||
Fixed maturities, at fair value
|
2.3
|
0.0
|
%
|
|||||
Equity securities, at fair value
|
716.6
|
3.9
|
%
|
|||||
Other invested assets
|
1,591.7
|
8.6
|
%
|
|||||
Cash and short-term investments
|
897.1
|
4.9
|
%
|
|||||
Total investments and cash
|
$
|
18,433.1
|
100.0
|
%
|
||||
(Some amounts may not reconcile due to rounding.)
|
·
|
the total voting power of any shareholder owning more than 9.9% of the common shares will be reduced to 9.9% of the total
voting power of the common shares;
|
·
|
the board of directors may decline to register any transfer of common shares if it has reason to believe that the transfer
would result in:
|
i.)
|
any person that is not an investment company beneficially owning more than 5.0% of any class of the issued and outstanding
share capital of Group,
|
ii.)
|
any person holding controlled shares in excess of 9.9% of any class of the issued and outstanding share capital of Group,
or
|
iii.)
|
any adverse tax, regulatory or legal consequences to Group, any of its subsidiaries or any of its shareholders;
|
·
|
Group also has the option to redeem or purchase all or part of a shareholder’s common shares to the extent the board of
directors determines it is necessary or advisable to avoid or cure any adverse or potential adverse consequences if:
|
i.)
|
any person that is not an investment company beneficially owns more than 5.0% of any class of the issued and outstanding
share capital of Group,
|
ii.)
|
any person holds controlled shares in excess of 9.9% of any class of the issued and outstanding share capital of Group, or
|
iii.)
|
share ownership by any person may result in adverse tax, regulatory or legal consequences to Group, any of its
subsidiaries or any other shareholder.
|
·
|
the material facts as to the interested director’s relationship or interests are disclosed or are known to the board of
directors and the board in good faith authorizes the transaction by the affirmative vote of a majority of the disinterested directors;
|
·
|
the material facts are disclosed or are known to the shareholders entitled to vote on the transaction and the transaction
is specifically approved in good faith by the holders of a majority of the voting shares; or
|
·
|
the transaction is fair to the corporation as of the time it is authorized, approved or ratified.
|
The TCJA addresses what some members of Congress had expressed concern about for several years, which was U.S. corporations moving their place of incorporation to low-tax jurisdictions to obtain a competitive advantage over domestic corporations that are subject to the U.S. corporate tax rate of 21%. Specifically, it addressed their concern over a perceived competitive advantage that foreign-controlled insurers and reinsurers may have had over U.S. controlled insurers and reinsurers resulting from the purchase of reinsurance by U.S. insurers from affiliates operating in some foreign jurisdictions, including Bermuda. Such affiliated reinsurance transactions are now subject to a Base Erosion and Anti-abuse Tax (“BEAT”) of 5% in 2018, 10% from 2019 to 2025 and 12.5% thereafter. In addition, new proposed regulations may further limit the ability of the Company to execute alternative capital balancing transactions with unrelated parties. This would further impact our net income and effective tax rate.
2018
|
2017
|
|||||||||||||||
High
|
Low
|
High
|
Low
|
|||||||||||||
First Quarter
|
$
|
262.67
|
$
|
216.47
|
$
|
239.15
|
$
|
216.04
|
||||||||
Second Quarter
|
260.00
|
224.72
|
258.12
|
230.63
|
||||||||||||
Third Quarter
|
236.32
|
209.84
|
271.12
|
211.94
|
||||||||||||
Fourth Quarter
|
230.17
|
205.03
|
240.51
|
210.36
|
Issuer Purchases of Equity Securities
|
||||||||||||||||
|
(a)
|
(b)
|
(c)
|
(d)
|
||||||||||||
|
Maximum Number (or
|
|||||||||||||||
|
Total Number of
|
Approximate Dollar
|
||||||||||||||
|
Shares (or Units)
|
Value) of Shares (or
|
||||||||||||||
|
Purchased as Part
|
Units) that May Yet
|
||||||||||||||
|
Total Number of
|
of Publicly
|
Be Purchased Under
|
|||||||||||||
|
Shares (or Units)
|
Average Price Paid
|
Announced Plans or
|
the Plans or
|
||||||||||||
Period
|
Purchased
|
per Share (or Unit)
|
Programs
|
Programs (1)
|
||||||||||||
January 1 - 31, 2018
|
0
|
$
|
-
|
0
|
1,785,507
|
|||||||||||
February 1 - 28, 2018
|
48,471
|
$
|
242.0134
|
0
|
1,785,507
|
|||||||||||
March 1 - 31, 2018
|
0
|
$
|
-
|
0
|
1,785,507
|
|||||||||||
April 1 - 30, 2018
|
0
|
$
|
-
|
0
|
1,785,507
|
|||||||||||
May 1 - 31, 2018
|
67,877
|
$
|
224.1978
|
67,000
|
1,718,507
|
|||||||||||
June 1 - 30, 2018
|
45,747
|
$
|
224.8436
|
45,747
|
1,672,760
|
|||||||||||
July 1 - 31, 2018
|
232
|
$
|
234.6125
|
0
|
1,672,760
|
|||||||||||
August 1 - 31, 2018
|
170,563
|
$
|
217.2371
|
170,338
|
1,502,422
|
|||||||||||
September 1 - 30, 2018
|
60,132
|
$
|
219.8726
|
59,094
|
1,443,328
|
|||||||||||
October 1 - 31, 2018
|
0
|
$
|
-
|
0
|
1,443,328
|
|||||||||||
November 1 - 30, 2018
|
493
|
$
|
217.5254
|
0
|
1,443,328
|
|||||||||||
December 1 - 31, 2018
|
0
|
$
|
-
|
0
|
1,443,328
|
|||||||||||
Total
|
393,515
|
$
|
-
|
342,179
|
1,443,328
|
![](https://www.sec.gov/Archives/edgar/data/0001095073/000109507319000011/image00025.jpg)
12/13
|
|
12/14
|
|
12/15
|
|
12/16
|
|
12/17
|
|
12/18
|
||||||||||
Everest Re Group, Ltd.
|
100.00
|
111.44
|
122.52
|
148.36
|
154.94
|
156.07
|
||||||||||||||
S&P 500
|
100.00
|
113.69
|
115.26
|
129.05
|
157.22
|
150.33
|
||||||||||||||
S&P Property & Casualty Insurance
|
100.00
|
115.74
|
126.77
|
146.68
|
179.52
|
171.10
|
Years Ended December 31,
|
||||||||||||||||||||
(Dollars in millions, except per share amounts)
|
2018
|
2017
|
2016
|
2015
|
2014
|
|||||||||||||||
Operating data:
|
||||||||||||||||||||
Gross written premiums
|
$
|
8,475.2
|
$
|
7,173.9
|
$
|
6,033.9
|
$
|
5,891.7
|
$
|
5,762.9
|
||||||||||
Net written premiums
|
7,414.4
|
6,244.7
|
5,270.9
|
5,182.3
|
5,132.4
|
|||||||||||||||
Premiums earned
|
6,931.7
|
5,937.8
|
5,320.5
|
5,292.8
|
5,043.7
|
|||||||||||||||
Net investment income
|
581.2
|
542.9
|
473.1
|
473.5
|
530.5
|
|||||||||||||||
Net realized capital gains (losses)
|
(127.1
|
)
|
153.2
|
(7.2
|
)
|
(184.1
|
)
|
84.0
|
||||||||||||
Incurred losses and loss adjustment
|
||||||||||||||||||||
expenses (including catastrophes)
|
5,651.4
|
4,522.6
|
3,139.6
|
3,064.7
|
2,875.9
|
|||||||||||||||
Net catastrophe losses (1)
|
1,669.8
|
1,339.1
|
286.0
|
50.7
|
50.1
|
|||||||||||||||
Commission, brokerage, taxes and fees
|
1,519.0
|
1,304.0
|
1,188.7
|
1,183.6
|
1,121.1
|
|||||||||||||||
Other underwriting expenses
|
371.5
|
318.8
|
302.7
|
257.1
|
233.1
|
|||||||||||||||
Corporate expenses
|
30.7
|
25.9
|
27.2
|
23.3
|
23.4
|
|||||||||||||||
Interest, fees and bond issue cost
|
||||||||||||||||||||
amortization expense
|
31.0
|
31.6
|
36.2
|
36.2
|
38.5
|
|||||||||||||||
Income (loss) before taxes
|
(226.5
|
)
|
405.2
|
1,099.8
|
1,111.9
|
1,386.8
|
||||||||||||||
Income tax expense (benefit)
|
(330.0
|
)
|
(63.8
|
)
|
103.5
|
134.0
|
187.7
|
|||||||||||||
Net income (loss) (2)
|
103.6
|
469.0
|
996.3
|
977.9
|
1,199.2
|
|||||||||||||||
EARNINGS PER COMMON SHARE:
|
||||||||||||||||||||
Basic (3)
|
$
|
2.54
|
$
|
11.43
|
$
|
23.85
|
$
|
22.29
|
$
|
26.16
|
||||||||||
Diluted (4)
|
$
|
2.53
|
$
|
11.36
|
$
|
23.68
|
$
|
22.10
|
$
|
25.91
|
||||||||||
Dividends declared
|
$
|
5.30
|
$
|
5.05
|
$
|
4.70
|
$
|
4.00
|
$
|
3.20
|
||||||||||
Certain GAAP financial ratios: (5)
|
||||||||||||||||||||
Loss ratio
|
81.5
|
%
|
76.2
|
%
|
59.0
|
%
|
57.9
|
%
|
57.0
|
%
|
||||||||||
Other underwriting expense ratio
|
27.3
|
%
|
27.3
|
%
|
28.0
|
%
|
27.2
|
%
|
26.8
|
%
|
||||||||||
Combined ratio (2)
|
108.8
|
%
|
103.5
|
%
|
87.0
|
%
|
85.1
|
%
|
83.8
|
%
|
||||||||||
Balance sheet data (at end of period):
|
||||||||||||||||||||
Total investments and cash
|
$
|
18,433.1
|
$
|
18,626.5
|
$
|
17,483.1
|
$
|
16,676.4
|
$
|
16,880.8
|
||||||||||
Total assets
|
24,794.0
|
23,591.8
|
21,321.5
|
20,545.4
|
20,339.9
|
|||||||||||||||
Loss and LAE reserves
|
13,119.1
|
11,884.3
|
10,312.3
|
9,951.8
|
9,720.8
|
|||||||||||||||
Total debt
|
633.6
|
633.4
|
633.2
|
633.0
|
632.7
|
|||||||||||||||
Total liabilities
|
16,890.2
|
15,222.6
|
13,246.1
|
12,936.8
|
12,888.8
|
|||||||||||||||
Shareholders' equity
|
7,903.8
|
8,369.2
|
8,075.4
|
7,608.6
|
7,451.1
|
|||||||||||||||
Book value per share (6)
|
194.43
|
204.95
|
197.45
|
178.21
|
166.75
|
|||||||||||||||
_____________________________
|
(1)
|
Catastrophe losses are presented net of reinsurance and reinstatement premiums. Catastrophe insurance provides
coverage for one event. When limits are exhausted, some contractual arrangements provide for the availability of additional coverage upon the payment of additional premium. This additional premium is referred to as
reinstatement premium.
|
(2)
|
Some amounts may not reconcile due to rounding.
|
(3)
|
Based on weighted average basic common shares outstanding of 40.4 million, 40.6 million, 41.3 million, 43.4
million and 45.4 million for 2018, 2017, 2016, 2015 and 2014, respectively.
|
(4)
|
Based on weighted average diluted common shares outstanding of 40.6 million, 40.8 million, 41.6 million, 43.8
million and 45.8 million for 2018, 2017, 2016, 2015 and 2014, respectively.
|
(5)
|
Loss ratio is the GAAP losses and LAE incurred as a percentage of GAAP net premiums earned. Underwriting
expense ratio is the GAAP commissions, brokerage, taxes, fees and other underwriting expenses as a percentage of GAAP net premiums earned. Combined ratio is the sum of the loss ratio and underwriting expense ratio.
|
(6)
|
Based on 40.7 million, 40.8 million, 40.9 million, 42.7 million and 44.7 million common shares outstanding for
December 31, 2018, 2017, 2016, 2015 and 2014, respectively.
|
Years Ended December 31,
|
Percentage Increase/(Decrease)
|
|||||||||||||||||||
(Dollars in millions)
|
2018
|
2017
|
2016
|
2018/2017
|
2017/2016
|
|||||||||||||||
Gross written premiums
|
$
|
8,475.2
|
$
|
7,173.9
|
$
|
6,033.9
|
18.1
|
%
|
18.9
|
%
|
||||||||||
Net written premiums
|
7,414.4
|
6,244.7
|
5,270.9
|
18.7
|
%
|
18.5
|
%
|
|||||||||||||
REVENUES:
|
||||||||||||||||||||
Premiums earned
|
$
|
6,931.7
|
$
|
5,937.8
|
$
|
5,320.5
|
16.7
|
%
|
11.6
|
%
|
||||||||||
Net investment income
|
581.2
|
542.9
|
473.1
|
7.1
|
%
|
14.8
|
%
|
|||||||||||||
Net realized capital gains (losses)
|
(127.1
|
)
|
153.2
|
(7.2
|
)
|
-183.0
|
%
|
NM
|
||||||||||||
Net derivative gain (loss)
|
0.5
|
9.6
|
18.6
|
-94.6
|
%
|
-48.6
|
%
|
|||||||||||||
Other income (expense)
|
(9.1
|
)
|
(35.4
|
)
|
(10.6
|
)
|
-74.4
|
%
|
233.2
|
%
|
||||||||||
Total revenues
|
7,377.2
|
6,608.1
|
5,794.3
|
11.6
|
%
|
14.0
|
%
|
|||||||||||||
CLAIMS AND EXPENSES:
|
||||||||||||||||||||
Incurred losses and loss adjustment expenses
|
5,651.4
|
4,522.6
|
3,139.6
|
25.0
|
%
|
44.0
|
%
|
|||||||||||||
Commission, brokerage, taxes and fees
|
1,519.0
|
1,304.0
|
1,188.7
|
16.5
|
%
|
9.7
|
%
|
|||||||||||||
Other underwriting expenses
|
371.5
|
318.8
|
302.7
|
16.5
|
%
|
5.3
|
%
|
|||||||||||||
Corporate expenses
|
30.7
|
25.9
|
27.2
|
18.3
|
%
|
-4.8
|
%
|
|||||||||||||
Interest, fees and bond issue cost amortization expense
|
31.0
|
31.6
|
36.2
|
-1.8
|
%
|
-12.8
|
%
|
|||||||||||||
Total claims and expenses
|
7,603.7
|
6,202.9
|
4,694.5
|
22.6
|
%
|
32.1
|
%
|
|||||||||||||
INCOME (LOSS) BEFORE TAXES
|
(226.5
|
)
|
405.2
|
1,099.8
|
-155.9
|
%
|
-63.2
|
%
|
||||||||||||
Income tax expense (benefit)
|
(330.0
|
)
|
(63.8
|
)
|
103.5
|
NM
|
-161.6
|
%
|
||||||||||||
NET INCOME (LOSS)
|
$
|
103.6
|
$
|
469.0
|
$
|
996.3
|
-77.9
|
%
|
-52.9
|
%
|
||||||||||
RATIOS:
|
Point Change
|
|||||||||||||||||||
Loss ratio
|
81.5
|
%
|
76.2
|
%
|
59.0
|
%
|
5.3
|
17.2
|
||||||||||||
Commission and brokerage ratio
|
21.9
|
%
|
22.0
|
%
|
22.3
|
%
|
(0.1
|
)
|
(0.3
|
)
|
||||||||||
Other underwriting expense ratio
|
5.4
|
%
|
5.3
|
%
|
5.7
|
%
|
0.1
|
(0.4
|
)
|
|||||||||||
Combined ratio
|
108.8
|
%
|
103.5
|
%
|
87.0
|
%
|
5.3
|
16.5
|
||||||||||||
At December 31,
|
Percentage Increase/(Decrease)
|
|||||||||||||||||||
(Dollars in millions, except per share amounts)
|
2018
|
2017
|
2016
|
2018/2017
|
2017/2016
|
|||||||||||||||
Balance sheet data:
|
||||||||||||||||||||
Total investments and cash
|
$
|
18,433.1
|
$
|
18,626.5
|
$
|
17,483.1
|
-1.0
|
%
|
6.5
|
%
|
||||||||||
Total assets
|
24,794.0
|
23,591.8
|
21,321.5
|
5.1
|
%
|
10.6
|
%
|
|||||||||||||
Loss and loss adjustment expense reserves
|
13,119.1
|
11,884.3
|
10,312.3
|
10.4
|
%
|
15.2
|
%
|
|||||||||||||
Total debt
|
633.6
|
633.4
|
633.2
|
0.0
|
%
|
0.0
|
%
|
|||||||||||||
Total liabilities
|
16,890.2
|
15,222.6
|
13,246.1
|
11.0
|
%
|
14.9
|
%
|
|||||||||||||
Shareholders' equity
|
7,903.8
|
8,369.2
|
8,075.4
|
-5.6
|
%
|
3.6
|
%
|
|||||||||||||
Book value per share
|
194.43
|
204.95
|
197.45
|
-5.1
|
%
|
3.8
|
%
|
|||||||||||||
(NM, not meaningful)
|
||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
|||||||||||||||||||||||||||
Current
|
Ratio %/
|
Prior
|
Ratio %/
|
Total
|
Ratio %/
|
||||||||||||||||||||||
(Dollars in millions)
|
Year
|
Pt Change
|
Years
|
Pt Change
|
Incurred
|
Pt Change
|
|||||||||||||||||||||
2018
|
|||||||||||||||||||||||||||
Attritional
|
$
|
4,025.4
|
58.0
|
%
|
$
|
(174.1
|
)
|
-2.5
|
%
|
$
|
3,851.2
|
55.5
|
%
|
||||||||||||||
Catastrophes
|
1,239.0
|
17.9
|
%
|
|
561.2
|
8.1
|
%
|
|
1,800.2
|
26.0
|
%
|
|
|||||||||||||||
Total segment
|
$
|
5,264.3
|
75.9
|
%
|
|
$
|
387.1
|
5.6
|
%
|
|
$
|
5,651.4
|
81.5
|
%
|
|
||||||||||||
2017
|
|||||||||||||||||||||||||||
Attritional
|
$
|
3,313.5
|
55.8
|
%
|
$
|
(263.4
|
)
|
-4.4
|
%
|
$
|
3,050.0
|
51.4
|
%
|
||||||||||||||
Catastrophes
|
1,502.5
|
25.3
|
%
|
|
(30.0
|
)
|
-0.5
|
%
|
|
1,472.6
|
24.8
|
%
|
|
||||||||||||||
Total segment
|
$
|
4,816.0
|
81.1
|
%
|
|
$
|
(293.4
|
)
|
-4.9
|
%
|
|
$
|
4,522.6
|
76.2
|
%
|
|
|||||||||||
2016
|
|||||||||||||||||||||||||||
Attritional
|
$
|
3,047.1
|
57.2
|
%
|
$
|
(208.7
|
)
|
-3.9
|
%
|
$
|
2,838.4
|
53.3
|
%
|
||||||||||||||
Catastrophes
|
387.9
|
7.3
|
%
|
|
(86.6
|
)
|
-1.6
|
%
|
|
301.2
|
5.7
|
%
|
|
||||||||||||||
Total segment
|
$
|
3,435.0
|
64.5
|
%
|
|
$
|
(295.3
|
)
|
-5.5
|
%
|
|
$
|
3,139.6
|
59.0
|
%
|
|
|||||||||||
Variance 2018/2017
|
|||||||||||||||||||||||||||
Attritional
|
$
|
711.9
|
2.2
|
pts
|
$
|
89.3
|
1.9
|
pts
|
$
|
801.2
|
4.1
|
pts
|
|||||||||||||||
Catastrophes
|
(263.6
|
)
|
(7.4
|
)
|
pts
|
591.2
|
8.6
|
pts
|
327.6
|
1.2
|
pts
|
||||||||||||||||
Total segment
|
$
|
448.4
|
(5.2
|
)
|
pts
|
$
|
680.5
|
10.5
|
pts
|
$
|
1,128.8
|
5.3
|
pts
|
||||||||||||||
Variance 2017/2016
|
|||||||||||||||||||||||||||
Attritional
|
$
|
266.4
|
(1.4
|
)
|
pts
|
$
|
(54.7
|
)
|
(0.5
|
)
|
pts
|
$
|
211.6
|
(1.9
|
)
|
pts
|
|||||||||||
Catastrophes
|
1,114.6
|
18.0
|
pts
|
56.6
|
1.1
|
pts
|
1,171.4
|
19.1
|
pts
|
||||||||||||||||||
Total segment
|
$
|
1,381.0
|
16.6
|
pts
|
$
|
1.9
|
0.6
|
pts
|
$
|
1,383.0
|
17.2
|
pts
|
|||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
||||||||||||
(Dollars in millions)
|
2018
|
2017
|
2016
|
|||||||||
Fixed maturities
|
$
|
465.8
|
$
|
427.4
|
$
|
410.3
|
||||||
Equity securities
|
25.3
|
34.5
|
40.7
|
|||||||||
Short-term investments and cash
|
14.4
|
4.2
|
1.8
|
|||||||||
Other invested assets
|
||||||||||||
Limited partnerships
|
93.3
|
83.6
|
38.6
|
|||||||||
Other
|
17.0
|
10.1
|
2.9
|
|||||||||
Gross investment income before adjustments
|
615.8
|
559.8
|
494.3
|
|||||||||
Funds held interest income (expense)
|
6.3
|
11.9
|
7.9
|
|||||||||
Future policy benefit reserve income (expense)
|
(1.4
|
)
|
(1.3
|
)
|
(1.6
|
)
|
||||||
Gross investment income
|
620.7
|
570.4
|
500.5
|
|||||||||
Investment expenses
|
(39.5
|
)
|
(27.5
|
)
|
(27.4
|
)
|
||||||
Net investment income
|
$
|
581.2
|
$
|
542.9
|
$
|
473.1
|
||||||
|
||||||||||||
(Some amounts may not reconcile due to rounding.)
|
2018
|
|
2017
|
|
2016
|
|
Imbedded pre-tax yield of cash and invested assets at December 31
|
3.4%
|
3.0%
|
2.9%
|
||
Imbedded after-tax yield of cash and invested assets at December 31
|
3.0%
|
2.8%
|
2.4%
|
||
Annualized pre-tax yield on average cash and invested assets
|
3.2%
|
3.1%
|
2.8%
|
||
Annualized after-tax yield on average cash and invested assets
|
2.8%
|
2.5%
|
2.3%
|
2018
|
|
2017
|
|
2016
|
|
Fixed income portfolio total return
|
1.3%
|
2.5%
|
3.1%
|
||
Barclay's Capital - U.S. aggregate index
|
0.0%
|
3.5%
|
2.7%
|
||
Common equity portfolio total return
|
-5.2%
|
14.6%
|
8.4%
|
||
S&P 500 index
|
-4.4%
|
21.8%
|
12.0%
|
||
Other invested asset portfolio total return
|
11.1%
|
8.4%
|
4.3%
|
Years Ended December 31,
|
2018/2017
|
2017/2016
|
||||||||||||||||||
(Dollars in millions)
|
2018
|
2017
|
2016
|
Variance
|
Variance
|
|||||||||||||||
Gains (losses) from sales:
|
||||||||||||||||||||
Fixed maturity securities, market value:
|
||||||||||||||||||||
Gains
|
$
|
34.0
|
$
|
58.6
|
$
|
52.8
|
$
|
(24.6
|
)
|
$
|
5.8
|
|||||||||
Losses
|
(55.7
|
)
|
(40.9
|
)
|
(45.9
|
)
|
(14.8
|
)
|
5.0
|
|||||||||||
Total
|
(21.7
|
)
|
17.7
|
6.9
|
(39.4
|
)
|
10.8
|
|||||||||||||
Fixed maturity securities, fair value:
|
||||||||||||||||||||
Gains
|
-
|
-
|
0.3
|
-
|
(0.3
|
)
|
||||||||||||||
Losses
|
(1.8
|
)
|
-
|
(1.9
|
)
|
(1.8
|
)
|
1.9
|
||||||||||||
Total
|
(1.8
|
)
|
-
|
(1.6
|
)
|
(1.8
|
)
|
1.6
|
||||||||||||
Equity securities, market value:
|
||||||||||||||||||||
Gains
|
-
|
-
|
1.4
|
-
|
(1.4
|
)
|
||||||||||||||
Losses
|
-
|
(3.4
|
)
|
-
|
3.4
|
(3.4
|
)
|
|||||||||||||
Total
|
-
|
(3.4
|
)
|
1.4
|
3.4
|
(4.8
|
)
|
|||||||||||||
Equity securities, fair value:
|
||||||||||||||||||||
Gains
|
31.7
|
24.8
|
17.0
|
6.9
|
7.8
|
|||||||||||||||
Losses
|
(61.7
|
)
|
(17.8
|
)
|
(30.5
|
)
|
(43.9
|
)
|
12.7
|
|||||||||||
Total
|
(30.0
|
)
|
7.0
|
(13.4
|
)
|
(37.0
|
)
|
20.4
|
||||||||||||
Other Invested Assets
|
||||||||||||||||||||
Gains
|
1.8
|
-
|
-
|
1.8
|
-
|
|||||||||||||||
Losses
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Total
|
1.8
|
-
|
-
|
1.8
|
-
|
|||||||||||||||
Total net realized capital gains (losses) from sales:
|
||||||||||||||||||||
Gains
|
67.5
|
83.4
|
71.6
|
(15.9
|
)
|
11.8
|
||||||||||||||
Losses
|
(119.2
|
)
|
(62.1
|
)
|
(78.3
|
)
|
(57.1
|
)
|
16.2
|
|||||||||||
Total
|
(51.7
|
)
|
21.3
|
(6.7
|
)
|
(73.0
|
)
|
28.0
|
||||||||||||
Loss on sale of subsidiary:
|
-
|
-
|
(28.0
|
)
|
-
|
28.0
|
||||||||||||||
Other-than-temporary impairments:
|
(8.1
|
)
|
(7.1
|
)
|
(31.6
|
)
|
(1.0
|
)
|
24.5
|
|||||||||||
Gains (losses) from fair value adjustments:
|
||||||||||||||||||||
Fixed maturities, fair value
|
1.5
|
-
|
1.4
|
1.5
|
(1.4
|
)
|
||||||||||||||
Equity securities, fair value
|
(68.8
|
)
|
139.0
|
57.7
|
(207.8
|
)
|
81.3
|
|||||||||||||
Total
|
(67.3
|
)
|
139.0
|
59.1
|
(206.3
|
)
|
79.9
|
|||||||||||||
Total net realized capital gains (losses)
|
$
|
(127.1
|
)
|
$
|
153.2
|
$
|
(7.2
|
)
|
$
|
(280.3
|
)
|
$
|
160.4
|
|||||||
(Some amounts may not reconcile due to rounding.)
|
|
Years Ended December 31,
|
2018/2017
|
2017/2016
|
|||||||||||||||||||||||||
(Dollars in millions)
|
2018 |
2017 | 2016 |
Variance
|
% Change |
Variance |
% Change |
|||||||||||||||||||||
Gross written premiums
|
$
|
3,014.3
|
$
|
2,593.0
|
$
|
2,125.8
|
$
|
421.4
|
16.3
|
%
|
$
|
467.2
|
22.0
|
%
|
||||||||||||||
Net written premiums
|
2,642.2
|
2,245.4
|
1,970.6
|
396.8
|
17.7
|
%
|
274.8
|
13.9
|
%
|
|||||||||||||||||||
Premiums earned
|
$
|
2,529.0
|
$
|
2,181.2
|
$
|
2,072.2
|
$
|
347.8
|
15.9
|
%
|
$
|
109.0
|
5.3
|
%
|
||||||||||||||
Incurred losses and LAE
|
2,784.2
|
1,632.8
|
1,068.5
|
1,151.4
|
70.5
|
%
|
564.3
|
52.8
|
%
|
|||||||||||||||||||
Commission and brokerage
|
568.4
|
462.5
|
466.0
|
105.9
|
22.9
|
%
|
(3.5
|
)
|
-0.7
|
%
|
||||||||||||||||||
Other underwriting expenses
|
60.3
|
55.9
|
54.1
|
4.4
|
7.8
|
%
|
1.8
|
3.3
|
%
|
|||||||||||||||||||
Underwriting gain (loss)
|
$
|
(883.8
|
)
|
$
|
30.0
|
$
|
483.6
|
$
|
(913.8
|
)
|
NM
|
$
|
(453.6
|
)
|
-93.8
|
%
|
||||||||||||
Point Chg
|
Point Chg
|
|||||||||||||||||||||||||||
Loss ratio
|
110.1
|
%
|
74.9
|
%
|
51.6
|
%
|
35.2
|
23.3
|
||||||||||||||||||||
Commission and brokerage ratio
|
22.5
|
%
|
21.2
|
%
|
22.5
|
%
|
1.3
|
(1.3
|
)
|
|||||||||||||||||||
Other underwriting expense ratio
|
2.3
|
%
|
2.5
|
%
|
2.6
|
%
|
(0.2
|
)
|
(0.1
|
)
|
||||||||||||||||||
Combined ratio
|
134.9
|
%
|
98.6
|
%
|
76.7
|
%
|
36.3
|
21.9
|
||||||||||||||||||||
(NM, not meaningful)
|
||||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
|||||||||||||||||||||||||||
Current
|
Ratio %/
|
Prior
|
Ratio %/
|
Total
|
Ratio %/
|
||||||||||||||||||||||
(Dollars in millions)
|
Year
|
Pt Change
|
Years
|
Pt Change
|
Incurred
|
Pt Change
|
|||||||||||||||||||||
2018
|
|||||||||||||||||||||||||||
Attritional
|
$
|
1,383.1
|
54.7
|
%
|
$
|
(70.8
|
)
|
-2.8
|
%
|
$
|
1,312.4
|
51.9
|
%
|
||||||||||||||
Catastrophes
|
952.2
|
37.7
|
%
|
|
519.6
|
20.5
|
%
|
|
1,471.8
|
58.2
|
%
|
|
|||||||||||||||
Total segment
|
$
|
2,335.3
|
92.4
|
%
|
|
$
|
448.9
|
17.7
|
%
|
|
$
|
2,784.2
|
110.1
|
%
|
|
||||||||||||
2017
|
|||||||||||||||||||||||||||
Attritional
|
$
|
1,103.7
|
50.6
|
%
|
$
|
(165.5
|
)
|
-7.5
|
%
|
$
|
938.3
|
43.1
|
%
|
||||||||||||||
Catastrophes
|
715.7
|
32.8
|
%
|
|
(21.2
|
)
|
-1.0
|
%
|
|
694.5
|
31.8
|
%
|
|
||||||||||||||
Total segment
|
$
|
1,819.4
|
83.4
|
%
|
|
$
|
(186.6
|
)
|
-8.5
|
%
|
|
$
|
1,632.8
|
74.9
|
%
|
|
|||||||||||
2016
|
|||||||||||||||||||||||||||
Attritional
|
$
|
1,096.0
|
52.9
|
%
|
$
|
(126.4
|
)
|
-6.1
|
%
|
$
|
969.7
|
46.8
|
%
|
||||||||||||||
Catastrophes
|
134.1
|
6.5
|
%
|
|
(35.3
|
)
|
-1.7
|
%
|
|
98.8
|
4.8
|
%
|
|
||||||||||||||
Total segment
|
$
|
1,230.1
|
59.4
|
%
|
|
$
|
(161.6
|
)
|
-7.8
|
%
|
|
$
|
1,068.5
|
51.6
|
%
|
|
|||||||||||
Variance 2018/2017
|
|||||||||||||||||||||||||||
Attritional
|
$
|
279.4
|
4.1
|
pts
|
$
|
94.7
|
4.7
|
pts
|
$
|
374.1
|
8.8
|
pts
|
|||||||||||||||
Catastrophes
|
236.5
|
4.9
|
pts
|
540.8
|
21.5
|
pts
|
777.3
|
26.4
|
pts
|
||||||||||||||||||
Total segment
|
$
|
515.9
|
9.0
|
pts
|
$
|
635.5
|
26.2
|
pts
|
$
|
1,151.4
|
35.2
|
pts
|
|||||||||||||||
Variance 2017/2016
|
|||||||||||||||||||||||||||
Attritional
|
$
|
7.7
|
(2.3
|
)
|
pts
|
$
|
(39.1
|
)
|
(1.4
|
)
|
pts
|
$
|
(31.4
|
)
|
(3.7
|
)
|
pts
|
||||||||||
Catastrophes
|
581.6
|
26.3
|
pts
|
14.1
|
0.7
|
pts
|
595.7
|
27.0
|
pts
|
||||||||||||||||||
Total segment
|
$
|
589.3
|
24.0
|
pts
|
$
|
(25.1
|
)
|
(0.7
|
)
|
pts
|
$
|
564.3
|
23.3
|
pts
|
|||||||||||||
(Some amounts may not reconcile due to rounding.)
|
|
Years Ended December 31,
|
2018/2017
|
2017/2016
|
|||||||||||||||||||||||||
(Dollars in millions)
|
2018 |
2017 | 2016 |
Variance
|
% Change |
Variance |
% Change |
Gross written premiums
|
$
|
1,543.9
|
$
|
1,316.7
|
$
|
1,230.7
|
$
|
227.2
|
17.3
|
%
|
$
|
86.0
|
7.0
|
%
|
||||||||||||||
Net written premiums
|
1,458.7
|
1,229.6
|
1,082.7
|
229.1
|
18.6
|
%
|
146.9
|
13.6
|
%
|
|||||||||||||||||||
Premiums earned
|
$
|
1,439.9
|
$
|
1,202.0
|
$
|
1,119.1
|
$
|
237.8
|
19.8
|
%
|
$
|
82.9
|
7.4
|
%
|
||||||||||||||
Incurred losses and LAE
|
992.7
|
1,059.6
|
486.6
|
(66.9
|
)
|
-6.3
|
%
|
573.1
|
117.8
|
%
|
||||||||||||||||||
Commission and brokerage
|
364.0
|
287.7
|
283.4
|
76.3
|
26.5
|
%
|
4.2
|
1.5
|
%
|
|||||||||||||||||||
Other underwriting expenses
|
39.0
|
38.8
|
35.5
|
0.2
|
0.5
|
%
|
3.3
|
9.4
|
%
|
|||||||||||||||||||
Underwriting gain (loss)
|
$
|
44.1
|
$
|
(184.1
|
)
|
$
|
313.6
|
$
|
228.3
|
-124.0
|
%
|
$
|
(497.7
|
)
|
-158.7
|
%
|
||||||||||||
Point Chg
|
Point Chg
|
|||||||||||||||||||||||||||
Loss ratio
|
68.9
|
%
|
88.2
|
%
|
43.5
|
%
|
(19.3
|
)
|
44.7
|
|||||||||||||||||||
Commission and brokerage ratio
|
25.3
|
%
|
23.9
|
%
|
25.3
|
%
|
1.4
|
(1.4
|
)
|
|||||||||||||||||||
Other underwriting expense ratio
|
2.7
|
%
|
3.2
|
%
|
3.2
|
%
|
(0.5
|
)
|
-
|
|||||||||||||||||||
Combined ratio
|
96.9
|
%
|
115.3
|
%
|
72.0
|
%
|
(18.4
|
)
|
43.3
|
|||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
|||||||||||||||||||||||||||
Current
|
Ratio %/
|
Prior
|
Ratio %/
|
Total
|
Ratio %/
|
||||||||||||||||||||||
(Dollars in millions)
|
Year
|
Pt Change
|
Years
|
Pt Change
|
Incurred
|
Pt Change
|
|||||||||||||||||||||
2018
|
|||||||||||||||||||||||||||
Attritional
|
$
|
760.2
|
52.7
|
%
|
$
|
(27.4
|
)
|
-1.9
|
%
|
$
|
732.8
|
50.8
|
%
|
||||||||||||||
Catastrophes
|
165.3
|
11.5
|
%
|
|
94.7
|
6.6
|
%
|
|
260.0
|
18.1
|
%
|
|
|||||||||||||||
Total segment
|
$
|
925.5
|
64.2
|
%
|
|
$
|
67.2
|
4.7
|
%
|
|
$
|
992.7
|
68.9
|
%
|
|
||||||||||||
2017
|
|||||||||||||||||||||||||||
Attritional
|
$
|
605.3
|
50.4
|
%
|
$
|
0.2
|
0.0
|
%
|
$
|
605.6
|
50.4
|
%
|
|||||||||||||||
Catastrophes
|
456.3
|
38.0
|
%
|
|
(2.3
|
)
|
-0.2
|
%
|
|
454.0
|
37.8
|
%
|
|
||||||||||||||
Total segment
|
$
|
1,061.6
|
88.4
|
%
|
|
$
|
(2.1
|
)
|
-0.2
|
%
|
|
$
|
1,059.6
|
88.2
|
%
|
|
|||||||||||
2016
|
|||||||||||||||||||||||||||
Attritional
|
$
|
576.2
|
51.5
|
%
|
$
|
(224.8
|
)
|
-20.1
|
%
|
$
|
351.4
|
31.4
|
%
|
||||||||||||||
Catastrophes
|
178.8
|
16.0
|
%
|
|
(43.7
|
)
|
-3.9
|
%
|
|
135.2
|
12.1
|
%
|
|
||||||||||||||
Total segment
|
$
|
755.0
|
67.5
|
%
|
|
$
|
(268.5
|
)
|
-24.0
|
%
|
|
$
|
486.6
|
43.5
|
%
|
|
|||||||||||
Variance 2018/2017
|
|||||||||||||||||||||||||||
Attritional
|
$
|
154.9
|
2.3
|
pts
|
$
|
(27.6
|
)
|
(1.9
|
)
|
pts
|
$
|
127.2
|
0.4
|
pts
|
|||||||||||||
Catastrophes
|
(291.0
|
)
|
(26.5
|
)
|
pts
|
97.0
|
6.8
|
pts
|
(194.1
|
)
|
(19.7
|
)
|
pts
|
||||||||||||||
Total segment
|
$
|
(136.1
|
)
|
(24.2
|
)
|
pts
|
$
|
69.3
|
4.9
|
pts
|
$
|
(66.9
|
)
|
(19.3
|
)
|
pts
|
|||||||||||
Variance 2017/2016
|
|||||||||||||||||||||||||||
Attritional
|
$
|
29.1
|
(1.1
|
)
|
pts
|
$
|
225.0
|
20.1
|
pts
|
$
|
254.2
|
19.0
|
pts
|
||||||||||||||
Catastrophes
|
277.5
|
22.0
|
pts
|
41.4
|
3.7
|
pts
|
318.8
|
25.7
|
pts
|
||||||||||||||||||
Total segment
|
$
|
306.6
|
20.9
|
pts
|
$
|
266.4
|
23.8
|
pts
|
$
|
573.1
|
44.7
|
pts
|
|||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
|
Years Ended December 31,
|
2018/2017
|
2017/2016
|
|||||||||||||||||||||||||
(Dollars in millions)
|
2018 |
2017 | 2016 |
Variance
|
% Change |
Variance |
% Change |
Gross written premiums
|
$
|
1,666.3
|
$
|
1,205.0
|
$
|
890.4
|
$
|
461.3
|
38.3
|
%
|
$
|
314.6
|
35.3
|
%
|
||||||||||||||
Net written premiums
|
1,605.5
|
1,139.1
|
831.9
|
466.4
|
40.9
|
%
|
307.2
|
36.9
|
%
|
|||||||||||||||||||
Premiums earned
|
$
|
1,324.2
|
$
|
1,093.3
|
$
|
838.0
|
$
|
230.9
|
21.1
|
%
|
$
|
255.3
|
30.5
|
%
|
||||||||||||||
Incurred losses and LAE
|
808.7
|
735.3
|
461.9
|
73.4
|
10.0
|
%
|
273.4
|
59.2
|
%
|
|||||||||||||||||||
Commission and brokerage
|
319.2
|
303.7
|
234.0
|
15.5
|
5.1
|
%
|
69.7
|
29.8
|
%
|
|||||||||||||||||||
Other underwriting expenses
|
43.6
|
38.0
|
36.3
|
5.6
|
14.6
|
%
|
1.7
|
4.6
|
%
|
|||||||||||||||||||
Underwriting gain (loss)
|
$
|
152.7
|
$
|
16.2
|
$
|
105.7
|
$
|
136.5
|
NM
|
$
|
(89.5
|
)
|
-84.6
|
%
|
||||||||||||||
Point Chg
|
Point Chg
|
|||||||||||||||||||||||||||
Loss ratio
|
61.1
|
%
|
67.3
|
%
|
55.1
|
%
|
(6.2
|
)
|
12.2
|
|||||||||||||||||||
Commission and brokerage ratio
|
24.1
|
%
|
27.8
|
%
|
27.9
|
%
|
(3.7
|
)
|
(0.1
|
)
|
||||||||||||||||||
Other underwriting expense ratio
|
3.3
|
%
|
3.4
|
%
|
4.4
|
%
|
(0.1
|
)
|
(1.0
|
)
|
||||||||||||||||||
Combined ratio
|
88.5
|
%
|
98.5
|
%
|
87.4
|
%
|
(10.0
|
)
|
11.1
|
|||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
|||||||||||||||||||||||||||
Current
|
Ratio %/
|
Prior
|
Ratio %/
|
Total
|
Ratio %/
|
||||||||||||||||||||||
(Dollars in millions)
|
Year
|
Pt Change
|
Years
|
Pt Change
|
Incurred
|
Pt Change
|
|||||||||||||||||||||
2018
|
|||||||||||||||||||||||||||
Attritional
|
$
|
797.3
|
60.3
|
%
|
$
|
(23.7
|
)
|
-1.8
|
%
|
$
|
773.6
|
58.5
|
%
|
||||||||||||||
Catastrophes
|
78.4
|
5.9
|
%
|
|
(43.3
|
)
|
-3.3
|
%
|
|
35.1
|
2.6
|
%
|
|
||||||||||||||
Total segment
|
$
|
875.7
|
66.2
|
%
|
|
$
|
(66.9
|
)
|
-5.1
|
%
|
|
$
|
808.7
|
61.1
|
%
|
|
|||||||||||
2017
|
|||||||||||||||||||||||||||
Attritional
|
$
|
625.1
|
57.2
|
%
|
$
|
(41.8
|
)
|
-3.8
|
%
|
$
|
583.3
|
53.4
|
%
|
||||||||||||||
Catastrophes
|
159.9
|
14.6
|
%
|
|
(7.9
|
)
|
-0.7
|
%
|
|
152.0
|
13.9
|
%
|
|
||||||||||||||
Total segment
|
$
|
785.0
|
71.8
|
%
|
|
$
|
(49.7
|
)
|
-4.5
|
%
|
|
$
|
735.3
|
67.3
|
%
|
|
|||||||||||
2016
|
|||||||||||||||||||||||||||
Attritional
|
$
|
475.1
|
56.7
|
%
|
$
|
(31.2
|
)
|
-3.7
|
%
|
$
|
443.8
|
53.0
|
%
|
||||||||||||||
Catastrophes
|
25.5
|
3.0
|
%
|
|
(7.5
|
)
|
-0.9
|
%
|
|
18.1
|
2.1
|
%
|
|
||||||||||||||
Total segment
|
$
|
500.6
|
59.7
|
%
|
|
$
|
(38.7
|
)
|
-4.6
|
%
|
|
$
|
461.9
|
55.1
|
%
|
|
|||||||||||
Variance 2018/2017
|
|||||||||||||||||||||||||||
Attritional
|
$
|
172.2
|
3.1
|
pts
|
$
|
18.1
|
2.0
|
pts
|
$
|
190.3
|
5.1
|
pts
|
|||||||||||||||
Catastrophes
|
(81.5
|
)
|
(8.7
|
)
|
pts
|
(35.4
|
)
|
(2.6
|
)
|
pts
|
(116.9
|
)
|
(11.3
|
)
|
pts
|
||||||||||||
Total segment
|
$
|
90.7
|
(5.6
|
)
|
pts
|
$
|
(17.2
|
)
|
(0.6
|
)
|
pts
|
$
|
73.4
|
(6.2
|
)
|
pts
|
|||||||||||
Variance 2017/2016
|
|||||||||||||||||||||||||||
Attritional
|
$
|
150.0
|
0.5
|
pts
|
$
|
(10.6
|
)
|
(0.1
|
)
|
pts
|
$
|
139.5
|
0.4
|
pts
|
|||||||||||||
Catastrophes
|
134.4
|
11.6
|
pts
|
(0.4
|
)
|
0.2
|
pts
|
133.9
|
11.8
|
pts
|
|||||||||||||||||
Total segment
|
$
|
284.4
|
12.1
|
pts
|
$
|
(11.0
|
)
|
0.1
|
pts
|
$
|
273.4
|
12.2
|
pts
|
||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
|
Years Ended December 31,
|
2018/2017
|
2017/2016
|
|||||||||||||||||||||||||
(Dollars in millions)
|
2018 |
2017 | 2016 |
Variance
|
% Change |
Variance |
% Change |
Gross written premiums
|
$
|
2,250.6
|
$
|
2,059.2
|
$
|
1,787.0
|
$
|
191.3
|
9.3
|
%
|
$
|
272.2
|
15.2
|
%
|
||||||||||||||
Net written premiums
|
1,708.0
|
1,630.6
|
1,385.7
|
77.4
|
4.7
|
%
|
244.9
|
17.7
|
%
|
|||||||||||||||||||
Premiums earned
|
$
|
1,638.6
|
$
|
1,461.4
|
$
|
1,291.2
|
$
|
177.2
|
12.1
|
%
|
$
|
170.2
|
13.2
|
%
|
||||||||||||||
Incurred losses and LAE
|
1,065.8
|
1,094.9
|
1,122.7
|
(29.1
|
)
|
-2.7
|
%
|
(27.8
|
)
|
-2.5
|
%
|
|||||||||||||||||
Commission and brokerage
|
267.4
|
250.1
|
205.3
|
17.4
|
7.0
|
%
|
44.8
|
21.8
|
%
|
|||||||||||||||||||
Other underwriting expenses
|
228.7
|
186.1
|
176.8
|
42.6
|
22.9
|
%
|
9.3
|
5.3
|
%
|
|||||||||||||||||||
Underwriting gain (loss)
|
$
|
76.7
|
$
|
(69.6
|
)
|
$
|
(213.5
|
)
|
$
|
146.3
|
-210.1
|
%
|
$
|
143.9
|
-67.4
|
%
|
||||||||||||
Point Chg
|
Point Chg
|
|||||||||||||||||||||||||||
Loss ratio
|
65.0
|
%
|
74.9
|
%
|
86.9
|
%
|
(9.9
|
)
|
(12.0
|
)
|
||||||||||||||||||
Commission and brokerage ratio
|
16.3
|
%
|
17.1
|
%
|
15.9
|
%
|
(0.8
|
)
|
1.2
|
|||||||||||||||||||
Other underwriting expense ratio
|
14.0
|
%
|
12.8
|
%
|
13.7
|
%
|
1.2
|
(0.9
|
)
|
|||||||||||||||||||
Combined ratio
|
95.3
|
%
|
104.8
|
%
|
116.5
|
%
|
(9.5
|
)
|
(11.7
|
)
|
||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
|||||||||||||||||||||||||||
Current
|
Ratio %/
|
Prior
|
Ratio %/
|
Total
|
Ratio %/
|
||||||||||||||||||||||
(Dollars in millions)
|
Year
|
Pt Change
|
Years
|
Pt Change
|
Incurred
|
Pt Change
|
|||||||||||||||||||||
2018
|
|||||||||||||||||||||||||||
Attritional
|
$
|
1,084.8
|
66.2
|
%
|
$
|
(52.2
|
)
|
-3.2
|
%
|
$
|
1,032.6
|
63.0
|
%
|
||||||||||||||
Catastrophes
|
43.1
|
2.6
|
%
|
|
(9.9
|
)
|
-0.6
|
%
|
|
33.2
|
2.0
|
%
|
|
||||||||||||||
Total segment
|
$
|
1,127.9
|
68.8
|
%
|
|
$
|
(62.1
|
)
|
-3.8
|
%
|
|
$
|
1,065.8
|
65.0
|
%
|
|
|||||||||||
2017
|
|||||||||||||||||||||||||||
Attritional
|
$
|
979.3
|
67.0
|
%
|
$
|
(56.4
|
)
|
-3.9
|
%
|
$
|
922.9
|
63.1
|
%
|
||||||||||||||
Catastrophes
|
170.6
|
11.7
|
%
|
|
1.4
|
0.1
|
%
|
|
172.0
|
11.8
|
%
|
|
|||||||||||||||
Total segment
|
$
|
1,149.9
|
78.7
|
%
|
|
$
|
(55.0
|
)
|
-3.8
|
%
|
|
$
|
1,094.9
|
74.9
|
%
|
|
|||||||||||
2016
|
|||||||||||||||||||||||||||
Attritional
|
$
|
899.9
|
69.7
|
%
|
$
|
173.6
|
13.4
|
%
|
$
|
1,073.5
|
83.1
|
%
|
|||||||||||||||
Catastrophes
|
49.4
|
3.8
|
%
|
|
(0.2
|
)
|
0.0
|
%
|
|
49.2
|
3.8
|
%
|
|
||||||||||||||
Total segment
|
$
|
949.3
|
73.5
|
%
|
|
$
|
173.4
|
13.4
|
%
|
|
$
|
1,122.7
|
86.9
|
%
|
|
||||||||||||
Variance 2018/2017
|
|||||||||||||||||||||||||||
Attritional
|
$
|
105.5
|
(0.8
|
)
|
pts
|
$
|
4.2
|
0.7
|
pts
|
$
|
109.7
|
(0.1
|
)
|
pts
|
|||||||||||||
Catastrophes
|
(127.5
|
)
|
(9.1
|
)
|
pts
|
(11.3
|
)
|
(0.7
|
)
|
pts
|
(138.8
|
)
|
(9.8
|
)
|
pts
|
||||||||||||
Total segment
|
$
|
(22.0
|
)
|
(9.9
|
)
|
pts
|
$
|
(7.1
|
)
|
-
|
pts
|
$
|
(29.1
|
)
|
(9.9
|
)
|
pts
|
||||||||||
Variance 2017/2016
|
|||||||||||||||||||||||||||
Attritional
|
$
|
79.4
|
(2.7
|
)
|
pts
|
$
|
(230.0
|
)
|
(17.3
|
)
|
pts
|
$
|
(150.6
|
)
|
(20.0
|
)
|
pts
|
||||||||||
Catastrophes
|
121.2
|
7.9
|
pts
|
1.6
|
0.1
|
pts
|
122.8
|
8.0
|
pts
|
||||||||||||||||||
Total segment
|
$
|
200.6
|
5.2
|
pts
|
$
|
(228.4
|
)
|
(17.2
|
)
|
pts
|
$
|
(27.8
|
)
|
(12.0
|
)
|
pts
|
|||||||||||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
||||||||||||
(Dollars in millions)
|
2018
|
2017
|
2016
|
|||||||||
U.S. Reinsurance
|
$
|
592.9
|
$
|
354.3
|
$
|
385.5
|
||||||
International
|
330.6
|
275.2
|
235.4
|
|||||||||
Bermuda
|
439.5
|
270.3
|
258.4
|
|||||||||
Total
|
$
|
1,362.9
|
$
|
899.8
|
$
|
879.3
|
||||||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
||||||||||||||||
(Dollars in millions)
|
2018
|
2017
|
||||||||||||||
Fixed maturities, market value
|
$
|
15,225.3
|
82.6
|
%
|
$
|
14,756.8
|
79.2
|
%
|
||||||||
Fixed maturities, fair value
|
2.3
|
0.0
|
%
|
|||||||||||||
Equity securities, market value
|
-
|
0.0
|
%
|
129.5
|
0.7
|
%
|
||||||||||
Equity securities, fair value
|
716.6
|
3.9
|
%
|
963.6
|
5.2
|
%
|
||||||||||
Short-term investments
|
241.0
|
1.3
|
%
|
509.7
|
2.7
|
%
|
||||||||||
Other invested assets
|
1,591.7
|
8.6
|
%
|
1,631.9
|
8.8
|
%
|
||||||||||
Cash
|
656.1
|
3.6
|
%
|
635.1
|
3.4
|
%
|
||||||||||
Total investments and cash
|
$
|
18,433.1
|
100.0
|
%
|
$
|
18,626.5
|
100.0
|
%
|
||||||||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
|||
2018
|
2017
|
||
Fixed income portfolio duration (years)
|
3.0
|
3.1
|
|
Fixed income composite credit quality
|
Aa3
|
Aa3
|
|
Imbedded end of period yield, pre-tax
|
3.4%
|
3.0%
|
|
Imbedded end of period yield, after-tax
|
3.0%
|
2.8%
|
At December 31, 2018
|
||||||||||||||||
Case
|
IBNR
|
Total
|
% of
|
|||||||||||||
(Dollars in millions)
|
Reserves
|
Reserves
|
Reserves
|
Total
|
||||||||||||
U.S. Reinsurance
|
$
|
2,191.5
|
$
|
2,498.7
|
$
|
4,690.2
|
35.8
|
%
|
||||||||
International
|
1,194.3
|
1,010.4
|
2,204.7
|
16.8
|
%
|
|||||||||||
Bermuda
|
1,163.5
|
1,592.4
|
2,755.9
|
21.0
|
%
|
|||||||||||
Insurance
|
1,082.0
|
2,038.9
|
3,120.9
|
23.8
|
%
|
|||||||||||
Total excluding A&E
|
5,631.2
|
7,140.4
|
12,771.6
|
97.4
|
%
|
|||||||||||
A&E
|
270.6
|
76.9
|
347.5
|
2.6
|
%
|
|||||||||||
Total including A&E
|
$
|
5,901.9
|
$
|
7,217.3
|
$
|
13,119.1
|
100.0
|
%
|
||||||||
(Some amounts may not reconcile due to rounding.)
|
At December 31, 2017
|
||||||||||||||||
Case
|
IBNR
|
Total
|
% of
|
|||||||||||||
(Dollars in millions)
|
Reserves
|
Reserves
|
Reserves
|
Total
|
||||||||||||
U.S. Reinsurance
|
$
|
1,719.6
|
$
|
2,041.0
|
$
|
3,760.6
|
31.6
|
%
|
||||||||
International
|
1,147.6
|
1,022.9
|
2,170.5
|
18.3
|
%
|
|||||||||||
Bermuda
|
1,037.8
|
1,417.0
|
2,454.8
|
20.7
|
%
|
|||||||||||
Insurance
|
1,049.4
|
2,000.0
|
3,049.4
|
25.7
|
%
|
|||||||||||
Total excluding A&E
|
4,954.3
|
6,481.0
|
11,435.3
|
96.2
|
%
|
|||||||||||
A&E
|
306.0
|
143.0
|
449.0
|
3.8
|
%
|
|||||||||||
Total including A&E
|
$
|
5,260.4
|
$
|
6,623.9
|
$
|
11,884.3
|
100.0
|
%
|
||||||||
(Some amounts may not reconcile due to rounding.)
|
Outstanding Reserves and Ranges By Segment (1)
|
||||||||||||||||||||
At December 31, 2018
|
||||||||||||||||||||
As
|
Low
|
Low
|
High
|
High
|
||||||||||||||||
(Dollars in millions)
|
Reported
|
Range % (2)
|
Range (2)
|
Range % (2)
|
Range (2)
|
|||||||||||||||
Gross Reserves By Segment
|
||||||||||||||||||||
U.S. Reinsurance
|
$
|
4,690.2
|
-16.0
|
%
|
$
|
3,940.7
|
16.0
|
%
|
$
|
5,439.6
|
||||||||||
International
|
2,204.7
|
-12.7
|
%
|
1,923.7
|
12.7
|
%
|
2,485.7
|
|||||||||||||
Bermuda
|
2,755.9
|
-12.2
|
%
|
2,419.0
|
12.2
|
%
|
3,092.8
|
|||||||||||||
Insurance
|
3,120.9
|
-14.4
|
%
|
2,670.3
|
14.4
|
%
|
3,571.5
|
|||||||||||||
Total Gross Reserves (excluding A&E)
|
12,771.6
|
-10.5
|
%
|
11,426.5
|
10.5
|
%
|
14,116.7
|
|||||||||||||
A&E (All Segments)
|
347.5
|
-13.7
|
%
|
299.9
|
13.7
|
%
|
395.1
|
|||||||||||||
Total Gross Reserves
|
$
|
13,119.1
|
-10.4
|
%
|
11,749.5
|
10.4
|
%
|
14,488.6
|
||||||||||||
(Some amounts may not reconcile due to rounding.)
|
(1)
|
There can be no assurance that reserves will not ultimately exceed the indicated ranges requiring additional income
(loss) statement expense.
|
(2)
|
Although totals are displayed for both the low and high range amounts, it should be noted that statistically the range
of the total is not equal to the sum of the ranges of the segments.
|
Years Ended December 31,
|
||||||||||||
(Dollars in millions)
|
2018
|
2017
|
2016
|
|||||||||
Gross reserves
|
$
|
347.5
|
$
|
449.0
|
$
|
441.1
|
||||||
Reinsurance receivable
|
(86.0
|
)
|
(130.9
|
)
|
(122.0
|
)
|
||||||
Net reserves
|
$
|
261.5
|
$
|
318.1
|
$
|
319.1
|
||||||
(Some amounts may not reconcile due to rounding.)
|
Bermuda Re (1)
|
Everest Re (2)
|
|||||||||||||||
At December 31,
|
At December 31,
|
|||||||||||||||
(Dollars in millions)
|
2018 (3)
|
2017 (3)
|
2018
|
2017
|
||||||||||||
Regulatory targeted capital
|
$
|
-
|
$
|
2,368.6
|
$
|
2,173.0
|
$
|
2,076.9
|
||||||||
Actual capital
|
$
|
3,061.1
|
$
|
3,085.9
|
$
|
3,650.6
|
$
|
3,391.9
|
Payments due by period
|
||||||||||||||||||||
Less than
|
More than
|
|||||||||||||||||||
(Dollars in millions)
|
Total
|
1 year
|
1-3 years
|
3-5 years
|
5 years
|
|||||||||||||||
Senior notes
|
400.0
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
400.0
|
|||||||||||
Long term notes
|
238.6
|
-
|
-
|
-
|
238.6
|
|||||||||||||||
Interest expense (1)
|
1,075.3
|
31.4
|
62.8
|
62.8
|
918.2
|
|||||||||||||||
Employee benefit plans
|
53.0
|
8.1
|
7.8
|
4.5
|
32.6
|
|||||||||||||||
Operating lease agreements
|
91.8
|
19.0
|
27.8
|
18.1
|
26.9
|
|||||||||||||||
Gross reserve for losses and LAE (2)
|
13,119.1
|
3,847.1
|
4,389.8
|
1,831.0
|
3,051.2
|
|||||||||||||||
Total
|
$
|
14,977.7
|
$
|
3,905.6
|
$
|
4,488.2
|
$
|
1,916.4
|
$
|
4,667.5
|
||||||||||
(Some amounts may not reconcile due to rounding.)
|
(1)
|
Interest expense on long term notes is calculated at the variable floating rate of 5.0% as of December 31, 2018.
|
(2)
|
Loss and LAE reserves represent management’s best estimate of losses from claim and related settlement costs. Both the amounts and
timing of such payments are estimates, and the inherent variability of resolving claims as well as changes in market conditions make the timing of cash flows uncertain. Therefore, the ultimate amount and timing of loss and LAE
payments could differ from our estimates.
|
Consolidated Statements of Cash Flows:
|
At December 31, 2016
|
|||||||||||
Effect of
|
||||||||||||
adoption of
|
||||||||||||
As previously
|
new accounting
|
|||||||||||
reported
|
policy
|
As adopted
|
||||||||||
(Dollars in millions)
|
||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||||||
Change in other assets and liabilities, net
|
$
|
(56.2
|
)
|
$
|
10.6
|
$
|
(45.6
|
)
|
||||
Net cash provided by (used in) operating activities
|
1,373.0
|
10.6
|
1,383.6
|
|||||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||||||
Cost of shares withheld for taxes on settlements of
|
||||||||||||
share-based compensation awards
|
-
|
(10.6
|
)
|
(10.6
|
)
|
|||||||
Net cash provided by (used in) financing activities
|
(570.9
|
)
|
(10.6
|
)
|
(581.5
|
)
|
Impact of Interest Rate Shift in Basis Points
|
||||||||||||||||||||
At December 31, 2018
|
||||||||||||||||||||
-200
|
-100
|
0
|
100
|
200
|
||||||||||||||||
(Dollars in millions)
|
||||||||||||||||||||
Total Market/Fair Value
|
$
|
16,350.1
|
$
|
15,915.8
|
$
|
15,468.6
|
$
|
15,011.9
|
$
|
14,556.2
|
||||||||||
Market/Fair Value Change from Base (%)
|
5.7
|
%
|
2.9
|
%
|
0.0
|
%
|
-3.0
|
%
|
-5.9
|
%
|
||||||||||
Change in Unrealized Appreciation
|
||||||||||||||||||||
After-tax from Base ($)
|
$
|
785.4
|
$
|
399.5
|
$
|
-
|
$
|
(409.1
|
)
|
$
|
(817.7
|
)
|
Impact of Interest Rate Shift in Basis Points
|
||||||||||||||||||||
At December 31, 2017
|
||||||||||||||||||||
-200
|
-100
|
0
|
100
|
200
|
||||||||||||||||
(Dollars in millions)
|
||||||||||||||||||||
Total Market/Fair Value
|
$
|
16,130.5
|
$
|
15,704.8
|
$
|
15,266.5
|
$
|
14,807.6
|
$
|
14,347.1
|
||||||||||
Market/Fair Value Change from Base (%)
|
5.7
|
%
|
2.9
|
%
|
0.0
|
%
|
-3.0
|
%
|
-6.0
|
%
|
||||||||||
Change in Unrealized Appreciation
|
||||||||||||||||||||
After-tax from Base ($)
|
$
|
739.2
|
$
|
376.5
|
$
|
-
|
$
|
(397.8
|
)
|
$
|
(797.7
|
)
|
Impact of Percentage Change in Equity Fair/Market Values
|
||||||||||||||||||||
At December 31, 2018
|
||||||||||||||||||||
(Dollars in millions)
|
-20%
|
-10%
|
0%
|
10%
|
20%
|
|||||||||||||||
Fair/Market Value of the Equity Portfolio
|
$
|
573.3
|
$
|
645.0
|
$
|
716.6
|
$
|
788.3
|
$
|
860.0
|
||||||||||
After-tax Change in Fair/Market Value
|
$
|
(119.1
|
)
|
$
|
(59.5
|
)
|
$
|
-
|
$
|
59.5
|
$
|
119.1
|
Impact of Percentage Change in Equity Fair/Market Values
|
||||||||||||||||||||
At December 31, 2017
|
||||||||||||||||||||
(Dollars in millions)
|
-20%
|
-10%
|
0%
|
10%
|
20%
|
|||||||||||||||
Fair/Market Value of the Equity Portfolio
|
$
|
874.5
|
$
|
983.8
|
$
|
1,093.1
|
$
|
1,202.4
|
$
|
1,311.7
|
||||||||||
After-tax Change in Fair/Market Value
|
$
|
(150.7
|
)
|
$
|
(75.3
|
)
|
$
|
-
|
$
|
75.3
|
$
|
150.7
|
Change in Foreign Exchange Rates in Percent
|
||||||||||||||||||||
At December 31, 2018
|
||||||||||||||||||||
(Dollars in millions)
|
-20%
|
-10%
|
0%
|
10%
|
20%
|
|||||||||||||||
Total After-tax Foreign Exchange Exposure
|
$
|
(438.8
|
)
|
$
|
(219.4
|
)
|
$
|
-
|
$
|
219.4
|
$
|
438.8
|
Change in Foreign Exchange Rates in Percent
|
||||||||||||||||||||
At December 31, 2017
|
||||||||||||||||||||
(Dollars in millions)
|
-20%
|
-10%
|
0%
|
10%
|
20%
|
|||||||||||||||
Total After-tax Foreign Exchange Exposure
|
$
|
(370.7
|
)
|
$
|
(185.3
|
)
|
$
|
-
|
$
|
185.3
|
$
|
370.7
|
EVEREST RE GROUP, LTD.
|
|||
By:
|
/S/ DOMINIC J. ADDESSO
|
||
Dominic J. Addesso
|
|||
(President and Chief Executive Officer)
|
Signature
|
Title
|
Date
|
||||
/S/ DOMINIC J. ADDESSO
|
President and Chief Executive Officer
and Director (Principal Executive Officer)
|
March 1, 2019
|
||||
Dominic J. Addesso
|
||||||
/S/ CRAIG HOWIE
|
Executive Vice President and Chief Financial Officer
|
March 1, 2019
|
||||
Craig Howie
|
||||||
/S/ KEITH T. SHOEMAKER
|
Comptroller (Principal Accounting Officer)
|
March 1, 2019
|
||||
Keith T. Shoemaker
|
||||||
/S/ JOSEPH V. TARANTO
|
Chairman
|
March 1, 2019
|
||||
Joseph V. Taranto
|
||||||
/S/ JOHN J. AMORE
|
Director
|
March 1, 2019
|
||||
John J. Amore
|
||||||
/S/ WILLIAM F. GALTNEY, JR.
|
Director
|
March 1, 2019
|
||||
William F. Galtney, Jr.
|
||||||
/S/ JOHN A. GRAF
|
Director
|
March 1, 2019
|
||||
John A. Graf
|
||||||
/S/ GERALDINE LOSQUADRO
|
Director
|
March 1, 2019
|
||||
Geraldine Losquadro
|
||||||
/S/ ROGER M. SINGER
|
Director
|
March 1, 2019
|
||||
Roger M. Singer
|
||||||
/S/ JOHN A. WEBER
|
Director
|
March 1, 2019
|
||||
John A. Weber
|
||||||
INDEX TO EXHIBITS
|
|||||
Exhibit No.
|
|||||
2.
|
1
|
Agreement and Plan of Merger among Everest Reinsurance Holdings, Inc., Everest Re Group, Ltd. and Everest Re Merger Corporation,
incorporated herein by reference to Exhibit 2.1 to the Registration Statement on Form S-4 (No. 333-87361)
|
|||
3.
|
1
|
Memorandum of Association of Everest Re Group, Ltd., incorporated herein by reference to Exhibit 3.1 to the Registration Statement
on Form S-4 (No. 333-87361)
|
|||
3.
|
2
|
Bye-Laws of Everest Re Group, Ltd., incorporated herein by reference to exhibit 3.2 to the Everest Re Group, Ltd., Quarterly Report
for Form 10-Q for the quarter ended June 30, 2011 (the “second quarter 2011 10-Q”)
|
|||
4.
|
1
|
Specimen Everest Re Group, Ltd. common share certificate, incorporated herein by reference to Exhibit 4.1 of the Registration
Statement on Form S-4 (No. 333-87361)
|
|||
4.
|
2
|
Indenture, dated March 14, 2000, between Everest Reinsurance Holdings, Inc. and The Chase Manhattan Bank (now known as JPMorgan
Chase Bank), as Trustee, incorporated herein by reference to Exhibit 4.1 to Everest Reinsurance Holdings, Inc. Form 8-K filed on March 15, 2000
|
|||
4.
|
3
|
Fourth Supplemental Indenture relating to Holdings $400.0 million 4.868% Senior Notes due June 1, 2044, dated June 5, 2014, between
Holdings and The Bank of New York Mellon, as Trustee, incorporated herein by reference to Exhibit 4.1 to Everest Reinsurance Holdings, Inc. Form 8-K filed on June 5, 2014
|
|||
*10.
|
1
|
Everest Re Group, Ltd. Annual Incentive Plan effective January 1, 1999, incorporated herein by reference to Exhibit 10.1 to Everest
Reinsurance Holdings, Inc. Annual Report on Form 10-K for the year ended December 31, 1998 (the “1998 10-K”)
|
|||
*10.
|
2
|
Everest Re Group, Ltd. 2003 Non-Employee Director Equity Compensation Plan, incorporated herein by reference to Exhibit 4.1 to the Registration Statement on Form S-8 (No. 333-105483) | |||
*10.
|
3
|
Form of Non-Qualified Stock Option Award Agreement under the Everest Re Group, Ltd. 2003 Non-Employee Director Equity Compensation
Plan, incorporated herein by reference to Exhibit 10.47 to Everest Re Group, Ltd., Report on Form 10-K for the year ended December 31, 2004
|
||
*10.
|
4
|
Amendment of Everest Re Group, Ltd. 2003 Non-Employee Director Equity Compensation Plan adopted by shareholders at the annual
general meeting on May 25, 2005, incorporated herein by reference to Appendix B to the 2005 Proxy Statement filed on April 14, 2005
|
||
*10.
|
5
|
Form of Restricted Stock Award Agreement under the Everest Re Group, Ltd. 2003 Non-Employee Director Equity Compensation Plan,
incorporated by reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on September 22, 2005
|
||
10.
|
6
|
Completion of Tender Offer relating to Everest Reinsurance Holdings, Inc. 6.60% Fixed to Floating Rate Long Term Subordinated Notes (LoTSSM) dated March 19, 2009, incorporated herein by reference to Exhibit 99.1 to Everest Re Group, Ltd. Form 8-K filed on March 31, 2009 | ||
*10.
|
7
|
Everest Re Group, Ltd. 2009 Stock Option and Restricted Stock Plan for Non-Employee Directors incorporated herein by reference to Exhibit 10.1 to Everest Re Group, Ltd. second quarter 2009 10-Q |
*10.
|
8
|
Everest Re Group, Ltd. 2010 Stock Incentive Plan for employees is incorporated herein by reference to exhibit 10.2 to Everest Re
Group, Ltd. Form S-8 filed on September 30, 2010
|
|
*10.
|
9
|
Amendment of Executive Performance Annual Incentive Plan adopted by shareholders at the annual general meeting on May 18, 2011,
incorporated herein by reference to Appendix B to the 2011 Proxy Statement filed on April 15, 2011
|
|
10.
|
10
|
Credit Agreement, dated June 22, 2012, between Everest Re Group, Ltd., Everest Reinsurance (Bermuda), Ltd. and Everest International
Reinsurance, Ltd., certain lenders party thereto and Wells Fargo Bank, N.A. as administrative agent, providing for an $800.0 million four year senior credit facility, incorporated herein by reference to Exhibit 10.31 to Everest Re
Group, Ltd. Form 10-Q filed on August 9, 2012. This new agreement replaces the July 27, 2007 five year, $850.0 million senior credit facility
|
|
*10.
|
11
|
Chairmanship agreement between Everest Re Group, Ltd. and Joseph V. Taranto, dated June 19, 2013 and effective January 1, 2014,
incorporated herein by reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on June 24, 2013
|
|
*10.
|
12
|
Employment agreement between Everest Global Services, Inc., and Sanjoy Mukherjee, dated September 1, 2013, incorporated herein by
reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on August 16, 2013
|
|
*10.
|
13
|
Employment agreement between Everest Global Services, Inc., and John P. Doucette, dated September 1, 2013, incorporated herein by
reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on September 13, 2013
|
|
*10.
|
14
|
Employment agreement between Everest Reinsurance (Bermuda), Ltd. and Mark S. deSaram, dated September 24, 2014, incorporated herein
by reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on September 29, 2014
|
|
*10.
|
15
|
Amendment of Everest Re Group, Ltd. 2010 Stock Incentive Plan adopted by shareholders at the annual general meeting on May 13, 2015,
incorporated herein by reference to Appendix A to the 2015 Proxy Statement filed on April 10, 2015
|
|
*10.
|
16
|
Amendment of Everest Re Group, Ltd. 2003 Non-Employee Director Equity Compensation Plan adopted by shareholders at the annual
general meeting on May 13, 2015, incorporated herein by reference to Appendix B to the 2015 Proxy Statement filed on April 10, 2015
|
|
*10.
|
17
|
Employment agreement between Everest Global Services, Inc., Everest Reinsurance Holdings Inc. and Dominic J. Addesso, dated December
4, 2015, incorporated herein by reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on December 8, 2015
|
|
10.
|
18
|
Standby Letter of Credit, dated November 9, 2015, between Everest International Reinsurance, Ltd. and Lloyds Bank, Plc. providing
£175.0 million four year credit facility, incorporated herein by reference to Exhibit 10.23 to Everest Re Group, Ltd. Annual Report on Form 10-K- for the year ended December 31, 2015 filed on February 29, 2016
|
|
*10.
|
19
|
Amendment of employment agreement between Everest Global Services, Inc. and Sanjoy Mukherjee, dated February 12, 2016, incorporated
herein by reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on February 17, 2016
|
|
*10.
|
20
|
Amendment of employment agreement between Everest Global Services, Inc. and John P. Doucette, dated February 16, 2016, incorporated
herein by reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on February 17, 2016
|
*10.
|
21
|
Employment agreement between Everest Global Services, Inc. and Craig Howie, dated April 7, 2016, incorporated herein by reference to
Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on April 8, 2016
|
10.
|
22
|
Credit Agreement, dated May 26, 2016, between Everest Re Group, Ltd., Everest Reinsurance (Bermuda), Ltd. and Everest International
Reinsurance, Ltd., certain lenders party thereto and Wells Fargo Bank, N.A. as administrative agent, providing for an $800.0 million four year senior credit facility, incorporated herein by reference to Exhibit 10.31 to Everest Re
Group, Ltd. Form 10-Q filed on August 9, 2016. This new agreement replaces the June 22, 2012 four year, $800.0 million senior credit facility
|
|
*10.
|
23
|
Chairmanship agreement between Everest Re Group, Ltd. and Joseph V. Taranto, dated August 15, 2016 and effective January 1, 2017,
incorporated herein by reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on August 16, 2016
|
|
*10.
|
24
|
Employment agreement between Everest Global Services, Inc., and John P. Doucette, dated October 21, 2016, incorporated herein by
reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on October 26, 2016
|
|
10.
|
25
|
Amendment of Standby Letter of Credit, dated November 9, 2016, between Everest International Reinsurance, Ltd. and Lloyds Bank, Plc.
providing £140.0 million four year credit facility, herein by reference to Exhibit 10.26 to Everest Re Group, Ltd., Form 10-K filed on March 1, 2017
|
|
10.
|
26
|
Amendment of Standby Letter of Credit, dated December 30, 2016, between Everest Reinsurance (Bermuda), Ltd. and Citibank Europe plc
providing $200.0 million four year credit facility, herein by reference to Exhibit 10.27 to Everest Re Group, Ltd., Form 10-Kfiled on March 1, 2017
|
|
*10.
|
27
|
Employment agreement between Everest Global Services, Inc., and Sanjoy Mukherjee, dated January 3, 2017, incorporated herein by
reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on January 6, 2017
|
|
10.
|
28
|
Amendment of Standby Letter of Credit, dated May 17, 2017, between Everest International Reinsurance, Ltd. and Lloyds Bank, Plc.
providing £145.0 million four year credit facility, herein by reference to Exhibit 10.1 to Everest Re Group, Ltd., Form 10-Q filed on August 9, 2017
|
|
*10.
|
29
|
Employment agreement between Everest Re Group, Ltd., and Jonathan Zaffino dated September 8, 2017, incorporated herein by reference
to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on September 12, 2017
|
|
*10.
|
30
|
Amendment of employment agreement between Everest Global Services, Inc., Everest Re Group, Ltd., Everest Reinsurance Holdings Inc.
and Dominic J. Addesso, dated November 20, 2017, incorporated herein by reference to Exhibit 10.1 to Everest Re Group, Ltd. Form 8-K filed on November 20, 2017
|
|
10.
|
31
|
Bye-Law waiver agreement between Everest Re Group, Ltd., and BlackRock, Inc. dated December 1, 2017, incorporated herein by
reference to exhibit 10.1 to the Everest Re Group, Ltd., Form 8-K filed on December 4, 2017
|
|
10.
|
32
|
Amendment of Standby Letter of Credit, dated December 29, 2017, between Everest Reinsurance (Bermuda), Ltd. and Citibank Europe plc
providing $250.0 million four year credit facility, incorporated herein by reference to exhibit 10.26 to the Everest Re Group, Ltd., Form 10-K filed on March 1, 2018
|
|
10.
|
33
|
Amendment of Standby Letter of Credit, dated November 9, 2018, between Everest International Reinsurance, Ltd. and Lloyds Bank, Plc.
providing £30.0 million four year credit facility, filed herewith
|
|
|
|
10.
|
34
|
Amendment of Committed Facility Letter, dated December 10, 2018, between Everest Reinsurance (Bermuda), Ltd. and Citibank Europe plc
providing $200.0 million annually, filed herewith
|
||
21.
|
1
|
Subsidiaries of the registrant, filed herewith
|
||
23.
|
1
|
Consent of PricewaterhouseCoopers LLP, filed herewith
|
||
31.
|
1
|
Section 302 Certification of Dominic J. Addesso, filed herewith | ||
31.
|
2
|
Section 302 Certification of Craig Howie, filed herewith | ||
32.
|
1
|
Section 906 Certification of Dominic J. Addesso and Craig Howie, furnished herewith | ||
101.
|
INS
|
XBRL Instance Document | ||
101.
|
SCH
|
XBRL Taxonomy Extension Schema | ||
101.
|
CAL
|
XBRL Taxonomy Extension Calculation Linkbase | ||
101.
|
DEF
|
XBRL Taxonomy Extension Definition Linkbase | ||
101.
|
LAB
|
XBRL Taxonomy Extension Label Linkbase | ||
101.
|
PRE
|
XBRL Taxonomy Extension Presentation Linkbase | ||
* Management contract or compensatory plan or arrangement.
|
EVEREST RE GROUP, LTD.
|
|||||
INDEX TO FINANCIAL STATEMENTS AND SCHEDULES
|
|||||
Pages
|
|||||
Report of Independent Registered Public Accounting Firm
|
F-2
|
||||
Consolidated Balance Sheets at December 31, 2018 and 2017
|
F-4
|
||||
Consolidated Statements of Operations and Comprehensive Income (Loss) for the Years Ended
|
|||||
December 31, 2018, 2017 and 2016
|
F-5
|
||||
Consolidated Statements of Changes in Shareholders’ Equity for the Years Ended
|
|||||
December 31, 2018, 2017 and 2016
|
F-6
|
||||
Consolidated Statements of Cash Flows for the Years Ended
|
|||||
December 31, 2018, 2017 and 2016
|
F-7
|
||||
Notes to Consolidated Financial Statements
|
F-8
|
||||
Schedules
|
|||||
I
|
Summary of Investments Other Than Investments in Related Parties at December 31, 2018
|
S-1
|
|||
II
|
Condensed Financial Information of Registrant:
|
||||
Balance Sheets as of December 31, 2018 and 2017
|
S-2
|
||||
Statements of Operations for the Years Ended December 31, 2018, 2017 and 2016
|
S-3
|
||||
Statements of Cash Flows for the Years Ended December 31, 2018, 2017 and 2016
|
S-4
|
||||
Notes to Condensed Financial Information
|
S-5
|
||||
III
|
Supplementary Insurance Information for the Years Ended
|
||||
December 31, 2018, 2017 and 2016
|
S-6
|
||||
IV
|
Reinsurance for the Years Ended December 31, 2018, 2017 and 2016
|
S-7
|
|||
Schedules other than those listed above are omitted for the reason that they are not applicable or the information is otherwise
contained in the Financial Statements.
|
|||||
December 31,
|
||||||||
(Dollars and share amounts in thousands, except par value per share)
|
2018
|
2017
|
||||||
ASSETS:
|
||||||||
Fixed maturities - available for sale, at market value
|
$
|
15,225,263
|
$
|
14,756,834
|
||||
(amortized cost: 2018, $15,406,572; 2017, $14,689,598)
|
||||||||
Fixed maturities - available for sale, at Fair value
|
2,337
|
-
|
||||||
Equity securities, at market value (cost: 2018, $0; 2017, $130,287)
|
-
|
129,530
|
||||||
Equity securities, at fair value
|
716,639
|
963,572
|
||||||
Short-term investments (cost: 2018, $241,010; 2017, $509,682)
|
240,987
|
509,682
|
||||||
Other invested assets (cost: 2018, $1,591,745; 2017, $1,628,753)
|
1,591,745
|
1,631,850
|
||||||
Cash
|
656,095
|
635,067
|
||||||
Total investments and cash
|
18,433,066
|
18,626,535
|
||||||
Accrued investment income
|
104,619
|
97,704
|
||||||
Premiums receivable
|
2,218,283
|
1,844,881
|
||||||
Reinsurance receivables
|
1,787,648
|
1,348,226
|
||||||
Funds held by reinsureds
|
445,040
|
292,927
|
||||||
Deferred acquisition costs
|
511,573
|
411,587
|
||||||
Prepaid reinsurance premiums
|
343,343
|
288,211
|
||||||
Income taxes
|
592,385
|
299,438
|
||||||
Other assets
|
358,042
|
382,283
|
||||||
TOTAL ASSETS
|
$
|
24,793,999
|
$
|
23,591,792
|
||||
LIABILITIES:
|
||||||||
Reserve for losses and loss adjustment expenses
|
$
|
13,119,090
|
11,884,321
|
|||||
Future policy benefit reserve
|
46,778
|
51,014
|
||||||
Unearned premium reserve
|
2,517,612
|
2,000,556
|
||||||
Funds held under reinsurance treaties
|
13,099
|
18,030
|
||||||
Other net payable to reinsurers
|
218,439
|
218,017
|
||||||
Senior notes due 6/1/2044
|
396,954
|
396,834
|
||||||
Long term notes due 5/1/2067
|
236,659
|
236,561
|
||||||
Accrued interest on debt and borrowings
|
3,093
|
2,727
|
||||||
Equity index put option liability
|
11,958
|
12,477
|
||||||
Unsettled securities payable
|
51,112
|
38,743
|
||||||
Other liabilities
|
275,401
|
363,280
|
||||||
Total liabilities
|
16,890,195
|
15,222,560
|
||||||
Commitments and contingencies (Note 15)
|
||||||||
SHAREHOLDERS' EQUITY:
|
||||||||
Preferred shares, par value: $0.01; 50,000 shares authorized;
|
||||||||
no shares issued and outstanding
|
-
|
-
|
||||||
Common shares, par value: $0.01; 200,000 shares authorized; (2018) 69,202
|
||||||||
and (2017) 69,044 outstanding before treasury shares
|
692
|
691
|
||||||
Additional paid-in capital
|
2,188,777
|
2,165,768
|
||||||
Accumulated other comprehensive income (loss), net of deferred income tax expense
|
||||||||
(benefit) of ($20,697) at 2018 and $9,356 at 2017
|
(462,557
|
)
|
(160,891
|
)
|
||||
Treasury shares, at cost; 28,551 shares (2018) and 28,208 shares (2017)
|
(3,397,548
|
)
|
(3,322,244
|
)
|
||||
Retained earnings
|
9,574,440
|
9,685,908
|
||||||
Total shareholders' equity
|
7,903,804
|
8,369,232
|
||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
$
|
24,793,999
|
$
|
23,591,792
|
||||
The accompanying notes are an integral part of the consolidated financial statements.
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands, except per share amounts)
|
2018
|
2017
|
2016
|
|||||||||
REVENUES:
|
||||||||||||
Premiums earned
|
$
|
6,931,699
|
$
|
5,937,840
|
$
|
5,320,466
|
||||||
Net investment income
|
581,183
|
542,898
|
473,085
|
|||||||||
Net realized capital gains (losses):
|
||||||||||||
Other-than-temporary impairments on fixed maturity securities
|
(8,110
|
)
|
(7,093
|
)
|
(31,595
|
)
|
||||||
Other-than-temporary impairments on fixed maturity securities
|
||||||||||||
transferred to other comprehensive income (loss)
|
-
|
-
|
-
|
|||||||||
Other net realized capital gains (losses)
|
(119,026
|
)
|
160,287
|
24,379
|
||||||||
Total net realized capital gains (losses)
|
(127,136
|
)
|
153,194
|
(7,216
|
)
|
|||||||
Net derivative gain (loss)
|
520
|
9,581
|
18,647
|
|||||||||
Other income (expense)
|
(9,060
|
)
|
(35,442
|
)
|
(10,636
|
)
|
||||||
Total revenues
|
7,377,206
|
6,608,071
|
5,794,346
|
|||||||||
CLAIMS AND EXPENSES:
|
||||||||||||
Incurred losses and loss adjustment expenses
|
5,651,403
|
4,522,581
|
3,139,629
|
|||||||||
Commission, brokerage, taxes and fees
|
1,519,030
|
1,303,963
|
1,188,692
|
|||||||||
Other underwriting expenses
|
371,541
|
318,817
|
302,722
|
|||||||||
Corporate expenses
|
30,672
|
25,923
|
27,231
|
|||||||||
Interest, fees and bond issue cost amortization expense
|
31,031
|
31,603
|
36,228
|
|||||||||
Total claims and expenses
|
7,603,677
|
6,202,887
|
4,694,502
|
|||||||||
INCOME (LOSS) BEFORE TAXES
|
(226,471
|
)
|
405,184
|
1,099,844
|
||||||||
Income tax expense (benefit)
|
(330,023
|
)
|
(63,784
|
)
|
103,500
|
|||||||
NET INCOME (LOSS)
|
$
|
103,552
|
$
|
468,968
|
$
|
996,344
|
||||||
Other comprehensive income (loss), net of tax:
|
||||||||||||
Unrealized appreciation (depreciation) ("URA(D)") on securities arising during the period
|
(255,656
|
)
|
(64,348
|
)
|
57,629
|
|||||||
Reclassification adjustment for realized losses (gains) included in net income (loss)
|
27,496
|
(6,950
|
)
|
15,118
|
||||||||
Total URA(D) on securities arising during the period
|
(228,160
|
)
|
(71,298
|
)
|
72,747
|
|||||||
Foreign currency translation adjustments
|
(76,816
|
)
|
121,917
|
(55,341
|
)
|
|||||||
Benefit plan actuarial net gain (loss) for the period
|
(510
|
)
|
1,027
|
(7,488
|
)
|
|||||||
Reclassification adjustment for amortization of net (gain) loss included in net income (loss)
|
5,021
|
5,477
|
5,073
|
|||||||||
Total benefit plan net gain (loss) for the period
|
4,511
|
6,504
|
(2,415
|
)
|
||||||||
Total other comprehensive income (loss), net of tax
|
(300,465
|
)
|
57,123
|
14,991
|
||||||||
COMPREHENSIVE INCOME (LOSS)
|
$
|
(196,913
|
)
|
$
|
526,091
|
$
|
1,011,335
|
|||||
EARNINGS PER COMMON SHARE:
|
||||||||||||
Basic
|
$
|
2.54
|
$
|
11.43
|
$
|
23.85
|
||||||
Diluted
|
2.53
|
11.36
|
23.68
|
|||||||||
The accompanying notes are an integral part of the consolidated financial statements.
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands, except share and dividends per share amounts)
|
2018
|
2017
|
2016
|
|||||||||
COMMON SHARES (shares outstanding):
|
||||||||||||
Balance, beginning of period
|
40,835,272
|
40,898,864
|
42,694,252
|
|||||||||
Issued during the period, net
|
158,055
|
172,901
|
264,313
|
|||||||||
Treasury shares acquired
|
(342,179
|
)
|
(236,493
|
)
|
(2,059,701
|
)
|
||||||
Balance, end of period
|
40,651,148
|
40,835,272
|
40,898,864
|
|||||||||
COMMON SHARES (par value):
|
||||||||||||
Balance, beginning of period
|
$
|
691
|
$
|
689
|
$
|
686
|
||||||
Issued during the period, net
|
1
|
2
|
3
|
|||||||||
Balance, end of period
|
692
|
691
|
689
|
|||||||||
ADDITIONAL PAID-IN CAPITAL:
|
||||||||||||
Balance, beginning of period
|
2,165,768
|
2,140,783
|
2,103,638
|
|||||||||
Share-based compensation plans
|
23,009
|
24,985
|
37,145
|
|||||||||
Balance, end of period
|
2,188,777
|
2,165,768
|
2,140,783
|
|||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS),
|
||||||||||||
NET OF DEFERRED INCOME TAXES:
|
||||||||||||
Balance, beginning of period
|
(160,891
|
)
|
(216,764
|
)
|
(231,755
|
)
|
||||||
Change to beginning balance due to adoption of Accounting Standards Update 2016-01
|
(1,201
|
)
|
-
|
-
|
||||||||
Reclass due to early adoption of Accounting Standards Update 2018-02
|
-
|
(1,250
|
)
|
-
|
||||||||
Net increase (decrease) during the period
|
(300,465
|
)
|
57,123
|
14,991
|
||||||||
Balance, end of period
|
(462,557
|
)
|
(160,891
|
)
|
(216,764
|
)
|
||||||
RETAINED EARNINGS:
|
||||||||||||
Balance, beginning of period
|
9,685,908
|
9,422,932
|
8,621,972
|
|||||||||
Change to beginning balance due to adoption of Accounting Standards Update 2016-01
|
1,201
|
-
|
-
|
|||||||||
Reclass due to early adoption of Accounting Standards Update 2018-02
|
-
|
1,250
|
-
|
|||||||||
Net income (loss)
|
103,552
|
468,968
|
996,344
|
|||||||||
Dividends declared ($5.30 per share in 2018, $5.05 per share in 2017
|
||||||||||||
and $4.70 per share in 2016)
|
(216,221
|
)
|
(207,242
|
)
|
(195,384
|
)
|
||||||
Balance, end of period
|
9,574,440
|
9,685,908
|
9,422,932
|
|||||||||
TREASURY SHARES AT COST:
|
||||||||||||
Balance, beginning of period
|
(3,322,244
|
)
|
(3,272,244
|
)
|
(2,885,956
|
)
|
||||||
Purchase of treasury shares
|
(75,304
|
)
|
(50,000
|
)
|
(386,288
|
)
|
||||||
Balance, end of period
|
(3,397,548
|
)
|
(3,322,244
|
)
|
(3,272,244
|
)
|
||||||
TOTAL SHAREHOLDERS' EQUITY, END OF PERIOD
|
$
|
7,903,804
|
$
|
8,369,232
|
$
|
8,075,396
|
||||||
The accompanying notes are an integral part of the consolidated financial statements.
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||||||
Net income (loss)
|
$
|
103,552
|
$
|
468,968
|
$
|
996,344
|
||||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||||||
Decrease (increase) in premiums receivable
|
(392,981
|
)
|
(338,335
|
)
|
(15,655
|
)
|
||||||
Decrease (increase) in funds held by reinsureds, net
|
(159,344
|
)
|
(31,104
|
)
|
22,219
|
|||||||
Decrease (increase) in reinsurance receivables
|
(511,592
|
)
|
(238,485
|
)
|
(202,950
|
)
|
||||||
Decrease (increase) in income taxes
|
(263,865
|
)
|
(114,521
|
)
|
54,526
|
|||||||
Decrease (increase) in prepaid reinsurance premiums
|
(65,925
|
)
|
(86,049
|
)
|
(32,455
|
)
|
||||||
Increase (decrease) in reserve for losses and loss adjustment expenses
|
1,377,711
|
1,376,321
|
545,967
|
|||||||||
Increase (decrease) in future policy benefit reserve
|
(4,236
|
)
|
(4,060
|
)
|
(3,836
|
)
|
||||||
Increase (decrease) in unearned premiums
|
542,023
|
401,174
|
(22,072
|
)
|
||||||||
Increase (decrease) in other net payable to reinsurers
|
12,276
|
10,071
|
26,200
|
|||||||||
Increase (decrease) in losses in course of payment
|
123,209
|
(105,371
|
)
|
(45,933
|
)
|
|||||||
Change in equity adjustments in limited partnerships
|
(102,052
|
)
|
(82,713
|
)
|
(37,939
|
)
|
||||||
Distribution of limited partnership income
|
84,623
|
50,825
|
62,008
|
|||||||||
Change in other assets and liabilities, net
|
(322,107
|
)
|
(66,998
|
)
|
(45,605
|
)
|
||||||
Non-cash compensation expense
|
32,369
|
30,297
|
26,398
|
|||||||||
Amortization of bond premium (accrual of bond discount)
|
29,272
|
45,867
|
49,167
|
|||||||||
Net realized capital (gains) losses
|
127,136
|
(153,194
|
)
|
7,216
|
||||||||
Net cash provided by (used in) operating activities
|
610,069
|
1,162,693
|
1,383,600
|
|||||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||||||
Proceeds from fixed maturities matured/called - available for sale, at market value
|
1,973,652
|
2,160,298
|
1,919,808
|
|||||||||
Proceeds from fixed maturities sold - available for sale, at market value
|
3,148,428
|
2,401,844
|
1,258,434
|
|||||||||
Proceeds from fixed maturities sold - available for sale, at fair value
|
1,751
|
-
|
5,837
|
|||||||||
Proceeds from equity securities sold, at market value
|
-
|
19,574
|
6,423
|
|||||||||
Proceeds from equity securities sold, at fair value
|
1,199,409
|
631,859
|
723,359
|
|||||||||
Distributions from other invested assets
|
3,102,018
|
5,579,043
|
4,823,484
|
|||||||||
Proceeds from sale of subsidiary (net of cash disposed)
|
-
|
-
|
47,721
|
|||||||||
Cost of fixed maturities acquired - available for sale, at market value
|
(5,909,504
|
)
|
(5,131,098
|
)
|
(4,061,896
|
)
|
||||||
Cost of fixed maturities acquired - available for sale, at fair value
|
(4,381
|
)
|
-
|
(3,940
|
)
|
|||||||
Cost of equity securities acquired, at market value
|
-
|
(22,033
|
)
|
(12,538
|
)
|
|||||||
Cost of equity securities acquired, at fair value
|
(921,937
|
)
|
(438,641
|
)
|
(346,929
|
)
|
||||||
Cost of other invested assets acquired
|
(3,370,455
|
)
|
(5,829,271
|
)
|
(5,396,001
|
)
|
||||||
Net change in short-term investments
|
455,350
|
(73,923
|
)
|
368,977
|
||||||||
Net change in unsettled securities transactions
|
46,048
|
(30,229
|
)
|
9,388
|
||||||||
Net cash provided by (used in) investing activities
|
(279,621
|
)
|
(732,577
|
)
|
(657,873
|
)
|
||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||||||
Common shares issued during the period for share-based compensation, net of expense
|
(8,157
|
)
|
(5,310
|
)
|
10,751
|
|||||||
Purchase of treasury shares
|
(75,304
|
)
|
(50,000
|
)
|
(386,288
|
)
|
||||||
Dividends paid to shareholders
|
(216,221
|
)
|
(207,242
|
)
|
(195,384
|
)
|
||||||
Cost of shares withheld on settlements of share-based compensation awards
|
(16,912
|
)
|
(12,906
|
)
|
(10,595
|
)
|
||||||
Net cash provided by (used in) financing activities
|
(316,594
|
)
|
(275,458
|
)
|
(581,516
|
)
|
||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH
|
7,174
|
(1,513
|
)
|
54,053
|
||||||||
Net increase (decrease) in cash
|
21,028
|
153,145
|
198,264
|
|||||||||
Cash, beginning of period
|
635,067
|
481,922
|
283,658
|
|||||||||
Cash, end of period
|
$
|
656,095
|
$
|
635,067
|
$
|
481,922
|
||||||
SUPPLEMENTAL CASH FLOW INFORMATION:
|
||||||||||||
Income taxes paid (recovered)
|
$
|
(65,064
|
)
|
$
|
53,743
|
$
|
42,636
|
|||||
Interest paid
|
30,447
|
32,194
|
36,010
|
|||||||||
NON-CASH TRANSACTIONS:
|
||||||||||||
Reclassification of investment balances due to prospective consolidation of private placement
|
||||||||||||
liquidity sweep facility effective July 1, 2018
|
||||||||||||
Fixed maturities - available for sale, at market value
|
$
|
143,656
|
$
|
-
|
$
|
-
|
||||||
Short-term investments
|
243,864
|
-
|
-
|
|||||||||
Other invested assets
|
(387,520
|
)
|
-
|
-
|
||||||||
The accompanying notes are an integral part of the consolidated financial statements.
|
Years Ended December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Reinsurance receivables and premium receivables
|
$
|
25,611
|
$
|
23,473
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Deferred acquisition costs
|
$
|
1,519,030
|
$
|
1,303,963
|
$
|
1,188,692
|
Years Ended December 31,
|
|||||||||||||
(Dollars in thousands, except per share amounts)
|
2018
|
2017
|
2016
|
||||||||||
Net income (loss) per share:
|
|||||||||||||
Numerator
|
|||||||||||||
Net income (loss)
|
$
|
103,552
|
$
|
468,968
|
$
|
996,344
|
|||||||
Less: dividends declared-common shares and nonvested common shares
|
(216,221
|
)
|
(207,242
|
)
|
(195,384
|
)
|
|||||||
Undistributed earnings
|
(112,669
|
)
|
261,725
|
800,960
|
|||||||||
Percentage allocated to common shareholders (1)
|
99.0
|
%
|
98.9
|
%
|
98.9
|
%
|
|||||||
(111,490
|
)
|
258,952
|
792,415
|
||||||||||
Add: dividends declared-common shareholders
|
214,088
|
205,182
|
193,413
|
||||||||||
Numerator for basic and diluted earnings per common share
|
$
|
102,598
|
$
|
464,134
|
$
|
985,829
|
|||||||
Denominator
|
|||||||||||||
Denominator for basic earnings per weighted-average common shares
|
40,388
|
40,595
|
41,329
|
||||||||||
Effect of dilutive securities:
|
|||||||||||||
Options
|
198
|
248
|
300
|
||||||||||
Denominator for diluted earnings per adjusted weighted-average common shares
|
40,586
|
40,843
|
41,628
|
||||||||||
Per common share net income (loss)
|
|||||||||||||
Basic
|
$
|
2.54
|
$
|
11.43
|
$
|
23.85
|
|||||||
Diluted
|
$
|
2.53
|
$
|
11.36
|
$
|
23.68
|
|||||||
(1)
|
Basic weighted-average common shares outstanding
|
40,388
|
40,595
|
41,329
|
|||||||||
Basic weighted-average common shares outstanding
and nonvested common shares expected to vest |
40,816
|
41,030
|
41,774
|
||||||||||
Percentage allocated to common shareholders |
99.0
|
%
|
98.9
|
%
|
98.9
|
%
|
|||||||
(Some amounts may not reconcile due to rounding.)
|
(Dollars in thousands)
|
||||||||||
Derivatives not designated as
|
Location of fair value
|
At December 31,
|
||||||||
hedging instruments
|
in balance sheets
|
2018
|
2017
|
|||||||
Equity index put option contracts
|
Equity index put option liability
|
$
|
11,958
|
$
|
12,477
|
|||||
Total
|
$
|
11,958
|
$
|
12,477
|
(Dollars in thousands)
|
||||||||||||||
Derivatives not designated as
|
Location of gain (loss) in statements of
|
For the Years Ended December 31,
|
||||||||||||
hedging instruments
|
operations and comprehensive income (loss)
|
2018
|
2017
|
2016
|
||||||||||
Equity index put option contracts
|
Net derivative gain (loss)
|
$
|
520
|
$
|
9,581
|
$
|
18,647
|
|||||||
Total
|
$
|
520
|
$
|
9,581
|
$
|
18,647
|
Consolidated Statements of Cash Flows:
|
At December 31, 2016
|
|||||||||||
Effect of
|
||||||||||||
adoption of
|
||||||||||||
As previously
|
new accounting
|
|||||||||||
reported
|
policy
|
As adopted
|
||||||||||
(Dollars in thousands)
|
||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||||||
Change in other assets and liabilities, net
|
$
|
(56,204
|
)
|
$
|
10,595
|
$
|
(45,609
|
)
|
||||
Net cash provided by (used in) operating activities
|
1,373,005
|
10,595
|
1,383,600
|
|||||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||||||
Cost of shares withheld for taxes on settlements of
|
||||||||||||
share-based compensation awards
|
-
|
(10,595
|
)
|
(10,595
|
)
|
|||||||
Net cash provided by (used in) financing activities
|
(570,921
|
)
|
(10,595
|
)
|
(581,516
|
)
|
At December 31, 2018
|
||||||||||||||||||||
Amortized
|
Unrealized
|
Unrealized
|
Market
|
OTTI in AOCI
|
||||||||||||||||
(Dollars in thousands)
|
Cost
|
Appreciation
|
Depreciation
|
Value
|
(a)
|
|||||||||||||||
Fixed maturity securities
|
||||||||||||||||||||
U.S. Treasury securities and obligations of
|
||||||||||||||||||||
U.S. government agencies and corporations
|
$
|
2,629,454
|
$
|
16,781
|
$
|
(15,101
|
)
|
$
|
2,631,134
|
$
|
-
|
|||||||||
Obligations of U.S. states and political subdivisions
|
490,018
|
12,915
|
(2,839
|
)
|
500,094
|
439
|
||||||||||||||
Corporate securities
|
5,538,582
|
48,465
|
(141,515
|
)
|
5,445,532
|
1,688
|
||||||||||||||
Asset-backed securities
|
545,427
|
162
|
(5,492
|
)
|
540,097
|
-
|
||||||||||||||
Mortgage-backed securities
|
||||||||||||||||||||
Commercial
|
329,883
|
2,167
|
(5,340
|
)
|
326,710
|
-
|
||||||||||||||
Agency residential
|
1,832,760
|
7,325
|
(43,821
|
)
|
1,796,264
|
-
|
||||||||||||||
Non-agency residential
|
10,198
|
37
|
(26
|
)
|
10,209
|
-
|
||||||||||||||
Foreign government securities
|
1,335,328
|
34,743
|
(55,906
|
)
|
1,314,165
|
98
|
||||||||||||||
Foreign corporate securities
|
2,694,922
|
63,994
|
(97,858
|
)
|
2,661,058
|
320
|
||||||||||||||
Total fixed maturity securities
|
$
|
15,406,572
|
$
|
186,589
|
$
|
(367,898
|
)
|
$
|
15,225,263
|
$
|
2,545
|
|||||||||
Equity securities
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
At December 31, 2017
|
||||||||||||||||||||
Amortized
|
Unrealized
|
Unrealized
|
Market
|
OTTI in AOCI
|
||||||||||||||||
(Dollars in thousands)
|
Cost
|
Appreciation
|
Depreciation
|
Value
|
(a)
|
|||||||||||||||
Fixed maturity securities
|
||||||||||||||||||||
U.S. Treasury securities and obligations of
|
||||||||||||||||||||
U.S. government agencies and corporations
|
$
|
1,540,952
|
$
|
9,816
|
$
|
(14,076
|
)
|
$
|
1,536,692
|
$
|
-
|
|||||||||
Obligations of U.S. states and political subdivisions
|
563,790
|
22,123
|
(444
|
)
|
585,469
|
-
|
||||||||||||||
Corporate securities
|
5,658,456
|
81,724
|
(41,175
|
)
|
5,699,005
|
2,488
|
||||||||||||||
Asset-backed securities
|
532,473
|
869
|
(1,982
|
)
|
531,360
|
-
|
||||||||||||||
Mortgage-backed securities
|
||||||||||||||||||||
Commercial
|
235,794
|
616
|
(2,369
|
)
|
234,041
|
-
|
||||||||||||||
Agency residential
|
2,236,361
|
10,379
|
(35,838
|
)
|
2,210,902
|
-
|
||||||||||||||
Non-agency residential
|
497
|
41
|
(44
|
)
|
494
|
-
|
||||||||||||||
Foreign government securities
|
1,305,070
|
43,804
|
(34,847
|
)
|
1,314,027
|
178
|
||||||||||||||
Foreign corporate securities
|
2,616,205
|
77,045
|
(48,406
|
)
|
2,644,844
|
950
|
||||||||||||||
Total fixed maturity securities
|
$
|
14,689,598
|
$
|
246,417
|
$
|
(179,181
|
)
|
$
|
14,756,834
|
$
|
3,616
|
|||||||||
Equity securities
|
$
|
130,287
|
$
|
2,615
|
$
|
(3,372
|
)
|
$
|
129,530
|
$
|
-
|
At December 31, 2018
|
At December 31, 2017
|
|||||||||||||||
Amortized
|
Market
|
Amortized
|
Market
|
|||||||||||||
(Dollars in thousands)
|
Cost
|
Value
|
Cost
|
Value
|
||||||||||||
Fixed maturity securities – available for sale:
|
||||||||||||||||
Due in one year or less
|
$
|
1,328,571
|
$
|
1,330,534
|
$
|
1,041,885
|
$
|
1,050,094
|
||||||||
Due after one year through five years
|
8,114,247
|
8,016,490
|
7,545,731
|
7,554,248
|
||||||||||||
Due after five years through ten years
|
2,455,911
|
2,413,846
|
2,214,473
|
2,231,456
|
||||||||||||
Due after ten years
|
789,575
|
791,113
|
882,384
|
944,239
|
||||||||||||
Asset-backed securities
|
545,427
|
540,097
|
532,473
|
531,360
|
||||||||||||
Mortgage-backed securities:
|
||||||||||||||||
Commercial
|
329,883
|
326,710
|
235,794
|
234,041
|
||||||||||||
Agency residential
|
1,832,760
|
1,796,264
|
2,236,361
|
2,210,902
|
||||||||||||
Non-agency residential
|
10,198
|
10,209
|
497
|
494
|
||||||||||||
Total fixed maturity securities
|
$
|
15,406,572
|
$
|
15,225,263
|
$
|
14,689,598
|
$
|
14,756,834
|
Years Ended December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Increase (decrease) during the period between the market value and cost
|
||||||||
of investments carried at market value, and deferred taxes thereon:
|
||||||||
Fixed maturity securities
|
$
|
(247,497
|
)
|
$
|
(101,940
|
)
|
||
Fixed maturity securities, other-than-temporary impairment
|
(1,071
|
)
|
(5,618
|
)
|
||||
Equity securities
|
-
|
9,730
|
||||||
Other invested assets
|
-
|
3,037
|
||||||
Change in unrealized appreciation (depreciation), pre-tax
|
(248,568
|
)
|
(94,791
|
)
|
||||
Deferred tax benefit (expense)
|
20,543
|
21,905
|
||||||
Deferred tax benefit (expense), other-than-temporary impairment
|
(135
|
)
|
1,588
|
|||||
Change in unrealized appreciation (depreciation),
|
||||||||
net of deferred taxes, included in shareholders’ equity
|
$
|
(228,160
|
)
|
$
|
(71,298
|
)
|
Duration of Unrealized Loss at December 31, 2018 By Security Type
|
||||||||||||||||||||||||
Less than 12 months
|
Greater than 12 months
|
Total
|
||||||||||||||||||||||
Gross
|
Gross
|
Gross
|
||||||||||||||||||||||
Unrealized
|
Unrealized
|
Unrealized
|
||||||||||||||||||||||
(Dollars in thousands)
|
Market Value
|
Depreciation
|
Market Value
|
Depreciation
|
Market Value
|
Depreciation
|
||||||||||||||||||
Fixed maturity securities - available for sale
|
||||||||||||||||||||||||
U.S. Treasury securities and obligations of
|
||||||||||||||||||||||||
U.S. government agencies and corporations
|
$
|
76,226
|
$
|
(158
|
)
|
$
|
777,409
|
$
|
(14,943
|
)
|
$
|
853,635
|
$
|
(15,101
|
)
|
|||||||||
Obligations of U.S. states and political subdivisions
|
71,559
|
(1,444
|
)
|
38,105
|
(1,395
|
)
|
109,664
|
(2,839
|
)
|
|||||||||||||||
Corporate securities
|
2,513,463
|
(69,619
|
)
|
1,683,729
|
(71,896
|
)
|
4,197,192
|
(141,515
|
)
|
|||||||||||||||
Asset-backed securities
|
230,285
|
(2,746
|
)
|
245,300
|
(2,746
|
)
|
475,585
|
(5,492
|
)
|
|||||||||||||||
Mortgage-backed securities
|
||||||||||||||||||||||||
Commercial
|
71,167
|
(1,128
|
)
|
154,201
|
(4,212
|
)
|
225,368
|
(5,340
|
)
|
|||||||||||||||
Agency residential
|
156,930
|
(975
|
)
|
1,373,629
|
(42,846
|
)
|
1,530,559
|
(43,821
|
)
|
|||||||||||||||
Non-agency residential
|
10,174
|
(26
|
)
|
-
|
-
|
10,174
|
(26
|
)
|
||||||||||||||||
Foreign government securities
|
196,303
|
(9,719
|
)
|
494,156
|
(46,187
|
)
|
690,459
|
(55,906
|
)
|
|||||||||||||||
Foreign corporate securities
|
939,808
|
(35,023
|
)
|
782,405
|
(62,835
|
)
|
1,722,213
|
(97,858
|
)
|
|||||||||||||||
Total fixed maturity securities
|
$
|
4,265,915
|
$
|
(120,838
|
)
|
$
|
5,548,934
|
$
|
(247,060
|
)
|
$
|
9,814,849
|
$
|
(367,898
|
)
|
|||||||||
Equity securities
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||
Total
|
$
|
4,265,915
|
$
|
(120,838
|
)
|
$
|
5,548,934
|
$
|
(247,060
|
)
|
$
|
9,814,849
|
$
|
(367,898
|
)
|
Duration of Unrealized Loss at December 31, 2018 By Maturity
|
||||||||||||||||||||||||
Less than 12 months
|
Greater than 12 months
|
Total
|
||||||||||||||||||||||
Gross
|
Gross
|
Gross
|
||||||||||||||||||||||
Unrealized
|
Unrealized
|
Unrealized
|
||||||||||||||||||||||
(Dollars in thousands)
|
Market Value
|
Depreciation
|
Market Value
|
Depreciation
|
Market Value
|
Depreciation
|
||||||||||||||||||
Fixed maturity securities
|
||||||||||||||||||||||||
Due in one year or less
|
$
|
454,239
|
$
|
(2,558
|
)
|
$
|
427,513
|
$
|
(20,675
|
)
|
$
|
881,752
|
$
|
(23,233
|
)
|
|||||||||
Due in one year through five years
|
2,014,704
|
(45,148
|
)
|
2,764,981
|
(129,940
|
)
|
4,779,685
|
(175,088
|
)
|
|||||||||||||||
Due in five years through ten years
|
1,082,568
|
(51,300
|
)
|
492,216
|
(34,210
|
)
|
1,574,784
|
(85,510
|
)
|
|||||||||||||||
Due after ten years
|
245,848
|
(16,957
|
)
|
91,094
|
(12,431
|
)
|
336,942
|
(29,388
|
)
|
|||||||||||||||
Asset-backed securities
|
230,285
|
(2,746
|
)
|
245,300
|
(2,746
|
)
|
475,585
|
(5,492
|
)
|
|||||||||||||||
Mortgage-backed securities
|
238,271
|
(2,129
|
)
|
1,527,830
|
(47,058
|
)
|
1,766,101
|
(49,187
|
)
|
|||||||||||||||
Total fixed maturity securities
|
$
|
4,265,915
|
$
|
(120,838
|
)
|
$
|
5,548,934
|
$
|
(247,060
|
)
|
$
|
9,814,849
|
$
|
(367,898
|
)
|
Duration of Unrealized Loss at December 31, 2017 By Security Type
|
||||||||||||||||||||||||
Less than 12 months
|
Greater than 12 months
|
Total
|
||||||||||||||||||||||
Gross
|
Gross
|
Gross
|
||||||||||||||||||||||
Unrealized
|
Unrealized
|
Unrealized
|
||||||||||||||||||||||
(Dollars in thousands)
|
Market Value
|
Depreciation
|
Market Value
|
Depreciation
|
Market Value
|
Depreciation
|
||||||||||||||||||
Fixed maturity securities - available for sale
|
||||||||||||||||||||||||
U.S. Treasury securities and obligations of
|
||||||||||||||||||||||||
U.S. government agencies and corporations
|
$
|
1,077,051
|
$
|
(8,380
|
)
|
$
|
224,189
|
$
|
(5,696
|
)
|
$
|
1,301,240
|
$
|
(14,076
|
)
|
|||||||||
Obligations of U.S. states and political subdivisions
|
4,400
|
(27
|
)
|
37,886
|
(417
|
)
|
42,286
|
(444
|
)
|
|||||||||||||||
Corporate securities
|
1,779,292
|
(24,942
|
)
|
700,098
|
(16,233
|
)
|
2,479,390
|
(41,175
|
)
|
|||||||||||||||
Asset-backed securities
|
301,316
|
(1,467
|
)
|
72,780
|
(515
|
)
|
374,096
|
(1,982
|
)
|
|||||||||||||||
Mortgage-backed securities
|
||||||||||||||||||||||||
Commercial
|
101,821
|
(572
|
)
|
64,272
|
(1,797
|
)
|
166,093
|
(2,369
|
)
|
|||||||||||||||
Agency residential
|
610,941
|
(4,836
|
)
|
1,343,547
|
(31,002
|
)
|
1,954,488
|
(35,838
|
)
|
|||||||||||||||
Non-agency residential
|
-
|
-
|
69
|
(44
|
)
|
69
|
(44
|
)
|
||||||||||||||||
Foreign government securities
|
327,790
|
(12,811
|
)
|
331,432
|
(22,036
|
)
|
659,222
|
(34,847
|
)
|
|||||||||||||||
Foreign corporate securities
|
691,865
|
(19,381
|
)
|
450,860
|
(29,025
|
)
|
1,142,725
|
(48,406
|
)
|
|||||||||||||||
Total fixed maturity securities
|
$
|
4,894,476
|
$
|
(72,416
|
)
|
$
|
3,225,133
|
$
|
(106,765
|
)
|
$
|
8,119,609
|
$
|
(179,181
|
)
|
|||||||||
Equity securities
|
-
|
-
|
113,506
|
(3,372
|
)
|
113,506
|
(3,372
|
)
|
||||||||||||||||
Total
|
$
|
4,894,476
|
$
|
(72,416
|
)
|
$
|
3,338,639
|
$
|
(110,137
|
)
|
$
|
8,233,115
|
$
|
(182,553
|
)
|
Duration of Unrealized Loss at December 31, 2017 By Maturity
|
||||||||||||||||||||||||
Less than 12 months
|
Greater than 12 months
|
Total
|
||||||||||||||||||||||
Gross
|
Gross
|
Gross
|
||||||||||||||||||||||
Unrealized
|
Unrealized
|
Unrealized
|
||||||||||||||||||||||
(Dollars in thousands)
|
Market Value
|
Depreciation
|
Market Value
|
Depreciation
|
Market Value
|
Depreciation
|
||||||||||||||||||
Fixed maturity securities
|
||||||||||||||||||||||||
Due in one year or less
|
$
|
247,927
|
$
|
(962
|
)
|
$
|
206,113
|
$
|
(7,643
|
)
|
$
|
454,040
|
$
|
(8,605
|
)
|
|||||||||
Due in one year through five years
|
2,930,977
|
(42,480
|
)
|
1,200,414
|
(52,143
|
)
|
4,131,391
|
(94,623
|
)
|
|||||||||||||||
Due in five years through ten years
|
612,702
|
(20,154
|
)
|
292,245
|
(12,680
|
)
|
904,947
|
(32,834
|
)
|
|||||||||||||||
Due after ten years
|
88,792
|
(1,945
|
)
|
45,693
|
(941
|
)
|
134,485
|
(2,886
|
)
|
|||||||||||||||
Asset-backed securities
|
301,316
|
(1,467
|
)
|
72,780
|
(515
|
)
|
374,096
|
(1,982
|
)
|
|||||||||||||||
Mortgage-backed securities
|
712,762
|
(5,408
|
)
|
1,407,888
|
(32,843
|
)
|
2,120,650
|
(38,251
|
)
|
|||||||||||||||
Total fixed maturity securities
|
$
|
4,894,476
|
$
|
(72,416
|
)
|
$
|
3,225,133
|
$
|
(106,765
|
)
|
$
|
8,119,609
|
$
|
(179,181
|
)
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Fixed maturities
|
$
|
465,793
|
$
|
427,379
|
$
|
410,337
|
||||||
Equity securities
|
25,327
|
34,523
|
40,707
|
|||||||||
Short-term investments and cash
|
14,395
|
4,177
|
1,769
|
|||||||||
Other invested assets
|
||||||||||||
Limited partnerships
|
93,327
|
83,569
|
38,647
|
|||||||||
Other
|
16,960
|
10,125
|
2,852
|
|||||||||
Gross investment income before adjustments
|
615,802
|
559,773
|
494,312
|
|||||||||
Funds held interest income (expense)
|
6,300
|
11,874
|
7,853
|
|||||||||
Future policy benefit reserve income (expense)
|
(1,419
|
)
|
(1,282
|
)
|
(1,633
|
)
|
||||||
Gross investment income
|
620,683
|
570,365
|
500,532
|
|||||||||
Investment expenses
|
(39,500
|
)
|
(27,467
|
)
|
(27,447
|
)
|
||||||
Net investment income
|
$
|
581,183
|
$
|
542,898
|
$
|
473,085
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Fixed maturity securities, market value:
|
||||||||||||
Other-than-temporary impairments
|
$
|
(8,110
|
)
|
$
|
(7,093
|
)
|
$
|
(31,595
|
)
|
|||
Gains (losses) from sales
|
(21,719
|
)
|
17,714
|
6,918
|
||||||||
Fixed maturity securities, fair value:
|
||||||||||||
Gains (losses) from sales
|
(1,799
|
)
|
-
|
(1,586
|
)
|
|||||||
Gains (losses) from fair value adjustments
|
1,506
|
-
|
1,381
|
|||||||||
Equity securities, market value:
|
||||||||||||
Gains (losses) from sales
|
-
|
(3,424
|
)
|
1,426
|
||||||||
Equity securities, fair value:
|
||||||||||||
Gains (losses) from sales
|
(29,941
|
)
|
6,969
|
(13,442
|
)
|
|||||||
Gains (losses) from fair value adjustments
|
(68,832
|
)
|
138,973
|
57,686
|
||||||||
Sale of Subsidiary
|
-
|
-
|
(28,032
|
)
|
||||||||
Other invested assets
|
1,815
|
61
|
18
|
|||||||||
Short-term investments gain (loss)
|
(56
|
)
|
(6
|
)
|
10
|
|||||||
Total net realized capital gains (losses)
|
$
|
(127,136
|
)
|
$
|
153,194
|
$
|
(7,216
|
)
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Proceeds from sales of fixed maturity securities
|
$
|
3,150,179
|
$
|
2,401,844
|
$
|
1,264,271
|
||||||
Gross gains from sales
|
33,996
|
58,589
|
53,093
|
|||||||||
Gross losses from sales
|
(57,514
|
)
|
(40,875
|
)
|
(47,761
|
)
|
||||||
Proceeds from sales of equity securities
|
$
|
1,199,409
|
$
|
651,433
|
$
|
729,782
|
||||||
Gross gains from sales
|
31,718
|
24,809
|
18,462
|
|||||||||
Gross losses from sales
|
(61,659
|
)
|
(21,264
|
)
|
(30,478
|
)
|
At December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Gross reserves at January 1
|
$
|
11,884,321
|
$
|
10,312,313
|
$
|
9,951,798
|
||||||
Less reinsurance recoverables
|
(1,212,649
|
)
|
(990,862
|
)
|
(881,503
|
)
|
||||||
Net reserves at January 1
|
10,671,672
|
9,321,451
|
9,070,295
|
|||||||||
Incurred related to:
|
||||||||||||
Current year
|
5,264,327
|
4,815,967
|
3,434,964
|
|||||||||
Prior years
|
387,076
|
(293,386
|
)
|
(295,335
|
)
|
|||||||
Total incurred losses and LAE
|
5,651,403
|
4,522,581
|
3,139,629
|
|||||||||
Paid related to:
|
||||||||||||
Current year
|
1,700,765
|
1,280,605
|
745,642
|
|||||||||
Prior years
|
3,011,175
|
2,062,634
|
2,042,972
|
|||||||||
Total paid losses and LAE
|
4,711,940
|
3,343,239
|
2,788,614
|
|||||||||
Foreign exchange/translation adjustment
|
(111,686
|
)
|
170,879
|
(99,859
|
)
|
|||||||
Net reserves at December 31
|
11,499,449
|
10,671,672
|
9,321,451
|
|||||||||
Plus reinsurance recoverables
|
1,619,641
|
1,212,649
|
990,862
|
|||||||||
Gross reserves at December 31
|
$
|
13,119,090
|
$
|
11,884,321
|
$
|
10,312,313
|
At December 31, 2018
|
||||||||||||||||||||||||||||||||||||
Total of
|
||||||||||||||||||||||||||||||||||||
IBNR Liabilites
|
||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of reinsurance
|
Plus Expected
|
|||||||||||||||||||||||||||||||||||
Years Ended December 31,
|
Development
|
Cumulative
|
||||||||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
on Reported
|
Number of
|
||||||||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
Claims
|
Reported Claims
|
||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||
2012
|
$
|
401,071
|
$
|
395,957
|
$
|
329,314
|
$
|
325,429
|
$
|
321,461
|
$
|
321,479
|
$
|
326,806
|
10,999
|
N/A
|
||||||||||||||||||||
2013
|
311,025
|
388,483
|
385,863
|
388,568
|
372,805
|
365,605
|
19,447
|
N/A
|
||||||||||||||||||||||||||||
2014
|
367,551
|
383,763
|
392,514
|
375,608
|
365,466
|
39,295
|
N/A
|
|||||||||||||||||||||||||||||
2015
|
326,374
|
354,296
|
346,420
|
347,972
|
64,286
|
N/A
|
||||||||||||||||||||||||||||||
2016
|
330,366
|
345,836
|
347,112
|
126,677
|
N/A
|
|||||||||||||||||||||||||||||||
2017
|
337,211
|
383,183
|
205,494
|
N/A
|
||||||||||||||||||||||||||||||||
2018
|
424,578
|
306,262
|
N/A
|
|||||||||||||||||||||||||||||||||
$
|
2,560,722
|
|||||||||||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
||||||||||||||||||||||||||||
Years Ended December 31,
|
||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
2012
|
$
|
10,024
|
$
|
38,586
|
$
|
83,172
|
$
|
143,722
|
$
|
187,522
|
$
|
218,966
|
$
|
273,144
|
||||||||||||||
2013
|
14,885
|
49,047
|
108,956
|
171,047
|
211,503
|
286,865
|
||||||||||||||||||||||
2014
|
18,841
|
54,321
|
110,327
|
164,664
|
256,790
|
|||||||||||||||||||||||
2015
|
19,920
|
53,639
|
107,033
|
206,455
|
||||||||||||||||||||||||
2016
|
18,929
|
58,309
|
136,547
|
|||||||||||||||||||||||||
2017
|
25,802
|
87,654
|
||||||||||||||||||||||||||
2018
|
44,519
|
|||||||||||||||||||||||||||
$
|
1,291,974
|
|||||||||||||||||||||||||||
All outstanding liabilities prior to 2012, net of reinsurance
|
766,701
|
|||||||||||||||||||||||||||
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
$
|
2,035,448
|
||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited)
|
||||||||||||||
Years
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
|||||||
Casualty
|
6.0%
|
10.9%
|
16.7%
|
19.7%
|
16.7%
|
15.4%
|
16.6%
|
At December 31, 2018
|
||||||||||||||||||||||||||||||||||||
Total of
|
||||||||||||||||||||||||||||||||||||
IBNR Liabilites
|
||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of reinsurance
|
Plus Expected
|
|||||||||||||||||||||||||||||||||||
Years Ended December 31,
|
Development
|
Cumulative
|
||||||||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
on Reported
|
Number of
|
||||||||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
Claims
|
Reported Claims
|
||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||
2012
|
$
|
937,847
|
$
|
724,114
|
$
|
622,599
|
$
|
609,592
|
$
|
609,221
|
$
|
605,617
|
$
|
588,422
|
447
|
N/A
|
||||||||||||||||||||
2013
|
622,319
|
548,468
|
495,300
|
456,379
|
449,359
|
445,910
|
388
|
N/A
|
||||||||||||||||||||||||||||
2014
|
641,682
|
550,695
|
474,136
|
438,584
|
432,638
|
563
|
N/A
|
|||||||||||||||||||||||||||||
2015
|
679,227
|
544,371
|
488,878
|
463,808
|
9,543
|
N/A
|
||||||||||||||||||||||||||||||
2016
|
966,373
|
791,526
|
763,544
|
26,165
|
N/A
|
|||||||||||||||||||||||||||||||
2017
|
1,583,224
|
1,370,879
|
80,155
|
N/A
|
||||||||||||||||||||||||||||||||
2018
|
2,510,226
|
1,018,868
|
N/A
|
|||||||||||||||||||||||||||||||||
$
|
6,575,427
|
|||||||||||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
||||||||||||||||||||||||||||
Years Ended December 31,
|
||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
2012
|
$
|
242,393
|
$
|
402,441
|
$
|
493,375
|
$
|
529,745
|
$
|
547,202
|
$
|
564,014
|
$
|
566,019
|
||||||||||||||
2013
|
234,591
|
323,178
|
381,893
|
405,980
|
420,329
|
426,444
|
||||||||||||||||||||||
2014
|
218,743
|
321,677
|
370,142
|
396,142
|
406,522
|
|||||||||||||||||||||||
2015
|
226,256
|
327,633
|
389,474
|
417,755
|
||||||||||||||||||||||||
2016
|
286,110
|
552,068
|
641,815
|
|||||||||||||||||||||||||
2017
|
570,824
|
946,466
|
||||||||||||||||||||||||||
2018
|
923,030
|
|||||||||||||||||||||||||||
$
|
4,328,051
|
|||||||||||||||||||||||||||
All outstanding liabilities prior to 2012, net of reinsurance
|
44,374
|
|||||||||||||||||||||||||||
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
$
|
2,291,749
|
||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited)
|
||||||||||||||
Years
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
|||||||
Property
|
41.1%
|
26.9%
|
13.0%
|
5.9%
|
2.9%
|
2.2%
|
0.3%
|
At December 31, 2018
|
||||||||||||||||||||||||||||||||||||
Total of
|
||||||||||||||||||||||||||||||||||||
IBNR Liabilites
|
||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of reinsurance
|
Plus Expected
|
|||||||||||||||||||||||||||||||||||
Years Ended December 31,
|
Development
|
Cumulative
|
||||||||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
on Reported
|
Number of
|
||||||||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
Claims
|
Reported Claims
|
||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||
2012
|
$
|
222,133
|
$
|
144,930
|
$
|
134,301
|
$
|
134,537
|
$
|
117,757
|
$
|
119,753
|
118,521
|
12,511
|
N/A
|
|||||||||||||||||||||
2013
|
182,248
|
166,761
|
164,076
|
145,345
|
142,454
|
140,933
|
22,458
|
N/A
|
||||||||||||||||||||||||||||
2014
|
193,655
|
186,565
|
169,129
|
167,361
|
167,300
|
38,937
|
N/A
|
|||||||||||||||||||||||||||||
2015
|
192,112
|
178,898
|
173,427
|
176,819
|
50,962
|
N/A
|
||||||||||||||||||||||||||||||
2016
|
182,864
|
180,313
|
194,754
|
82,359
|
N/A
|
|||||||||||||||||||||||||||||||
2017
|
190,450
|
212,683
|
112,439
|
N/A
|
||||||||||||||||||||||||||||||||
2018
|
213,696
|
139,575
|
N/A
|
|||||||||||||||||||||||||||||||||
$
|
1,224,708
|
|||||||||||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
||||||||||||||||||||||||||||
Years Ended December 31,
|
||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
2012
|
$
|
18,951
|
$
|
30,257
|
$
|
46,283
|
$
|
56,773
|
$
|
66,611
|
$
|
77,658
|
$
|
84,250
|
||||||||||||||
2013
|
17,931
|
41,532
|
54,912
|
68,095
|
76,594
|
87,864
|
||||||||||||||||||||||
2014
|
25,920
|
45,022
|
62,968
|
74,571
|
87,331
|
|||||||||||||||||||||||
2015
|
24,324
|
49,039
|
70,370
|
83,888
|
||||||||||||||||||||||||
2016
|
26,556
|
51,325
|
73,376
|
|||||||||||||||||||||||||
2017
|
26,751
|
65,352
|
||||||||||||||||||||||||||
2018
|
42,745
|
|||||||||||||||||||||||||||
$
|
524,806
|
|||||||||||||||||||||||||||
All outstanding liabilities prior to 2012, net of reinsurance
|
134,507
|
|||||||||||||||||||||||||||
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
$
|
834,410
|
||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited)
|
||||||||||||||
Years
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
|||||||
Casualty
|
15.0%
|
14.1%
|
11.4%
|
8.1%
|
7.3%
|
8.6%
|
5.6%
|
At December 31, 2018
|
||||||||||||||||||||||||||||||||||||
Total of
|
||||||||||||||||||||||||||||||||||||
IBNR Liabilites
|
||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of reinsurance
|
Plus Expected
|
|||||||||||||||||||||||||||||||||||
Years Ended December 31,
|
Development
|
Cumulative
|
||||||||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
on Reported
|
Number of
|
||||||||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
Claims
|
Reported Claims
|
||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||
2012
|
$
|
560,846
|
$
|
513,661
|
$
|
460,161
|
$
|
464,190
|
$
|
464,468
|
$
|
465,344
|
464,331
|
1,684
|
N/A
|
|||||||||||||||||||||
2013
|
488,693
|
439,340
|
403,169
|
394,940
|
394,770
|
394,293
|
2,327
|
N/A
|
||||||||||||||||||||||||||||
2014
|
585,885
|
528,957
|
482,816
|
427,469
|
419,651
|
4,077
|
N/A
|
|||||||||||||||||||||||||||||
2015
|
560,099
|
427,930
|
426,695
|
415,349
|
5,363
|
N/A
|
||||||||||||||||||||||||||||||
2016
|
525,694
|
495,804
|
473,262
|
6,494
|
N/A
|
|||||||||||||||||||||||||||||||
2017
|
898,568
|
735,824
|
63,579
|
N/A
|
||||||||||||||||||||||||||||||||
2018
|
900,443
|
283,147
|
N/A
|
|||||||||||||||||||||||||||||||||
$
|
3,803,153
|
|||||||||||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
||||||||||||||||||||||||||||
Years Ended December 31,
|
||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
2012
|
$
|
199,774
|
$
|
325,557
|
$
|
393,284
|
$
|
417,136
|
$
|
430,438
|
$
|
441,346
|
$
|
445,139
|
||||||||||||||
2013
|
133,577
|
268,313
|
321,289
|
351,447
|
365,252
|
371,349
|
||||||||||||||||||||||
2014
|
160,761
|
279,587
|
345,699
|
376,890
|
388,877
|
|||||||||||||||||||||||
2015
|
143,474
|
259,981
|
328,818
|
364,391
|
||||||||||||||||||||||||
2016
|
154,471
|
284,995
|
375,090
|
|||||||||||||||||||||||||
2017
|
275,487
|
481,665
|
||||||||||||||||||||||||||
2018
|
331,806
|
|||||||||||||||||||||||||||
$
|
2,758,317
|
|||||||||||||||||||||||||||
All outstanding liabilities prior to 2012, net of reinsurance
|
71,452
|
|||||||||||||||||||||||||||
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
$
|
1,116,288
|
||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited)
|
||||||||||||||
Years
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
|||||||
Property
|
36.8%
|
28.7%
|
16.0%
|
7.1%
|
3.1%
|
2.0%
|
0.8%
|
At December 31, 2018
|
||||||||||||||||||||||||||||||||||||
Total of
|
||||||||||||||||||||||||||||||||||||
IBNR Liabilites
|
||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of reinsurance
|
Plus Expected
|
|||||||||||||||||||||||||||||||||||
Years Ended December 31,
|
Development
|
Cumulative
|
||||||||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
on Reported
|
Number of
|
||||||||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
Claims
|
Reported Claims
|
||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||
2012
|
$
|
281,244
|
$
|
259,000
|
$
|
238,059
|
$
|
227,918
|
$
|
234,498
|
$
|
234,752
|
$
|
239,750
|
41,516
|
N/A
|
||||||||||||||||||||
2013
|
225,224
|
255,280
|
249,831
|
258,408
|
247,754
|
236,753
|
59,324
|
N/A
|
||||||||||||||||||||||||||||
2014
|
208,813
|
241,109
|
258,275
|
254,844
|
243,331
|
89,698
|
N/A
|
|||||||||||||||||||||||||||||
2015
|
272,058
|
299,304
|
305,728
|
309,221
|
116,863
|
N/A
|
||||||||||||||||||||||||||||||
2016
|
290,327
|
348,318
|
358,604
|
165,626
|
N/A
|
|||||||||||||||||||||||||||||||
2017
|
349,666
|
401,587
|
273,964
|
N/A
|
||||||||||||||||||||||||||||||||
2018
|
465,351
|
407,072
|
N/A
|
|||||||||||||||||||||||||||||||||
$
|
2,254,597
|
|||||||||||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
||||||||||||||||||||||||||||
Years Ended December 31,
|
||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
2012
|
$
|
12,858
|
$
|
24,498
|
$
|
50,981
|
$
|
75,262
|
$
|
101,357
|
$
|
129,265
|
$
|
148,732
|
||||||||||||||
2013
|
16,852
|
33,681
|
51,906
|
76,711
|
102,137
|
124,532
|
||||||||||||||||||||||
2014
|
13,555
|
24,904
|
42,751
|
67,476
|
93,245
|
|||||||||||||||||||||||
2015
|
13,827
|
59,746
|
93,949
|
128,983
|
||||||||||||||||||||||||
2016
|
46,440
|
84,942
|
123,837
|
|||||||||||||||||||||||||
2017
|
30,073
|
70,228
|
||||||||||||||||||||||||||
2018
|
26,304
|
|||||||||||||||||||||||||||
$
|
715,862
|
|||||||||||||||||||||||||||
All outstanding liabilities prior to 2012, net of reinsurance
|
396,191
|
|||||||||||||||||||||||||||
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
$
|
1,934,926
|
||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited)
|
||||||||||||||
Years
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
|||||||
Casualty
|
7.1%
|
9.5%
|
9.4%
|
10.6%
|
10.7%
|
10.6%
|
8.1%
|
At December 31, 2018
|
||||||||||||||||||||||||||||||||||||
Total of
|
||||||||||||||||||||||||||||||||||||
IBNR Liabilites
|
||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of reinsurance
|
Plus Expected
|
|||||||||||||||||||||||||||||||||||
Years Ended December 31,
|
Development
|
Cumulative
|
||||||||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
on Reported
|
Number of
|
||||||||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
Claims
|
Reported Claims
|
||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||
2012
|
$
|
235,647
|
$
|
178,542
|
$
|
163,046
|
$
|
158,650
|
$
|
159,011
|
$
|
159,810
|
$
|
158,772
|
44
|
N/A
|
||||||||||||||||||||
2013
|
205,875
|
148,275
|
130,693
|
121,612
|
121,024
|
120,638
|
93
|
N/A
|
||||||||||||||||||||||||||||
2014
|
180,617
|
158,678
|
132,743
|
129,395
|
129,403
|
1,345
|
N/A
|
|||||||||||||||||||||||||||||
2015
|
190,578
|
156,407
|
143,576
|
149,560
|
5,773
|
N/A
|
||||||||||||||||||||||||||||||
2016
|
204,475
|
173,515
|
183,022
|
14,247
|
N/A
|
|||||||||||||||||||||||||||||||
2017
|
397,639
|
326,371
|
68,179
|
N/A
|
||||||||||||||||||||||||||||||||
2018
|
417,933
|
211,999
|
N/A
|
|||||||||||||||||||||||||||||||||
$
|
1,485,698
|
|||||||||||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
||||||||||||||||||||||||||||
Years Ended December 31,
|
||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
2012
|
$
|
45,230
|
$
|
84,263
|
$
|
115,420
|
$
|
141,232
|
$
|
147,802
|
$
|
150,694
|
$
|
152,352
|
||||||||||||||
2013
|
31,476
|
68,081
|
107,590
|
114,644
|
116,653
|
117,649
|
||||||||||||||||||||||
2014
|
28,654
|
82,208
|
101,831
|
121,289
|
123,600
|
|||||||||||||||||||||||
2015
|
32,878
|
72,123
|
109,036
|
132,327
|
||||||||||||||||||||||||
2016
|
26,771
|
76,426
|
128,948
|
|||||||||||||||||||||||||
2017
|
39,296
|
130,013
|
||||||||||||||||||||||||||
2018
|
76,805
|
|||||||||||||||||||||||||||
$
|
861,694
|
|||||||||||||||||||||||||||
All outstanding liabilities prior to 2012, net of reinsurance
|
35,767
|
|||||||||||||||||||||||||||
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
$
|
659,771
|
||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited)
|
||||||||||||||
Years
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
|||||||
Property
|
18.9%
|
28.9%
|
24.2%
|
13.5%
|
2.7%
|
1.4%
|
1.0%
|
At December 31, 2018
|
||||||||||||||||||||||||||||||||||||
Total of
|
||||||||||||||||||||||||||||||||||||
IBNR Liabilites
|
||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of reinsurance
|
Plus Expected
|
|||||||||||||||||||||||||||||||||||
Years Ended December 31,
|
Development
|
Cumulative
|
||||||||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
on Reported
|
Number of
|
||||||||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
Claims
|
Reported Claims
|
||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||
2012
|
$
|
349,247
|
$
|
351,052
|
$
|
346,636
|
$
|
347,954
|
$
|
353,113
|
$
|
343,717
|
$
|
346,604
|
26,417
|
15,746
|
||||||||||||||||||||
2013
|
393,165
|
393,076
|
392,513
|
392,818
|
351,105
|
344,070
|
24,697
|
21,314
|
||||||||||||||||||||||||||||
2014
|
430,475
|
456,454
|
453,994
|
460,074
|
396,313
|
48,264
|
25,112
|
|||||||||||||||||||||||||||||
2015
|
518,596
|
526,974
|
534,548
|
540,769
|
160,787
|
26,729
|
||||||||||||||||||||||||||||||
2016
|
552,091
|
554,468
|
578,911
|
211,614
|
31,120
|
|||||||||||||||||||||||||||||||
2017
|
615,187
|
601,464
|
309,285
|
33,822
|
||||||||||||||||||||||||||||||||
2018
|
701,774
|
526,090
|
27,224
|
|||||||||||||||||||||||||||||||||
$
|
3,509,905
|
|||||||||||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
||||||||||||||||||||||||||||
Years Ended December 31,
|
||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
2012
|
$
|
33,158
|
$
|
101,253
|
$
|
157,822
|
$
|
213,349
|
$
|
246,274
|
$
|
271,891
|
$
|
294,202
|
||||||||||||||
2013
|
33,301
|
117,013
|
176,273
|
224,548
|
260,075
|
285,680
|
||||||||||||||||||||||
2014
|
41,181
|
124,856
|
201,527
|
256,586
|
297,317
|
|||||||||||||||||||||||
2015
|
44,296
|
134,644
|
218,475
|
291,468
|
||||||||||||||||||||||||
2016
|
54,707
|
164,012
|
268,510
|
|||||||||||||||||||||||||
2017
|
53,869
|
171,978
|
||||||||||||||||||||||||||
2018
|
63,379
|
|||||||||||||||||||||||||||
$
|
1,672,535
|
|||||||||||||||||||||||||||
All outstanding liabilities prior to 2012, net of reinsurance
|
354,740
|
|||||||||||||||||||||||||||
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
$
|
2,192,111
|
||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited)
|
||||||||||||||
Years
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
|||||||
Casualty
|
9.2%
|
19.7%
|
17.3%
|
14.2%
|
10.0%
|
7.4%
|
6.4%
|
At December 31, 2018
|
||||||||||||||||||||||||||||||||||||
Total of
|
||||||||||||||||||||||||||||||||||||
IBNR Liabilites
|
||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of reinsurance
|
Plus Expected
|
|||||||||||||||||||||||||||||||||||
Years Ended December 31,
|
Development
|
Cumulative
|
||||||||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
on Reported
|
Number of
|
||||||||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
Claims
|
Reported Claims
|
||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||
2012
|
$
|
106,216
|
$
|
88,892
|
$
|
81,671
|
$
|
82,369
|
$
|
81,945
|
$
|
81,729
|
$
|
81,906
|
103
|
N/A
|
||||||||||||||||||||
2013
|
111,910
|
97,831
|
91,017
|
91,921
|
92,011
|
92,171
|
499
|
N/A
|
||||||||||||||||||||||||||||
2014
|
131,473
|
123,455
|
119,753
|
119,296
|
119,105
|
464
|
N/A
|
|||||||||||||||||||||||||||||
2015
|
172,467
|
152,521
|
143,558
|
146,356
|
695
|
N/A
|
||||||||||||||||||||||||||||||
2016
|
300,481
|
273,901
|
278,813
|
1,185
|
N/A
|
|||||||||||||||||||||||||||||||
2017
|
523,669
|
485,125
|
27,538
|
N/A
|
||||||||||||||||||||||||||||||||
2018
|
416,396
|
86,295
|
N/A
|
|||||||||||||||||||||||||||||||||
$
|
1,619,872
|
|||||||||||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
||||||||||||||||||||||||||||
Years Ended December 31,
|
||||||||||||||||||||||||||||
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
||||||||||||||||||||||
Accident Year
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
2012
|
$
|
56,497
|
$
|
81,700
|
$
|
80,394
|
$
|
81,674
|
$
|
81,818
|
$
|
81,609
|
$
|
81,747
|
||||||||||||||
2013
|
68,649
|
92,914
|
91,618
|
91,888
|
91,498
|
91,537
|
||||||||||||||||||||||
2014
|
81,755
|
115,890
|
118,060
|
118,043
|
118,375
|
|||||||||||||||||||||||
2015
|
101,975
|
140,960
|
142,089
|
144,823
|
||||||||||||||||||||||||
2016
|
161,993
|
248,555
|
270,765
|
|||||||||||||||||||||||||
2017
|
206,334
|
408,176
|
||||||||||||||||||||||||||
2018
|
254,270
|
|||||||||||||||||||||||||||
$
|
1,369,694
|
|||||||||||||||||||||||||||
All outstanding liabilities prior to 2012, net of reinsurance
|
330
|
|||||||||||||||||||||||||||
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
$
|
250,508
|
||||||||||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited)
|
||||||||||||||
Years
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
|||||||
Property
|
63.4%
|
30.8%
|
3.2%
|
1.0%
|
0.1%
|
0.1%
|
0.2%
|
December 31, 2018
|
||||
(Dollars in thousands)
|
||||
Net outstanding liabilities
|
||||
U.S. Reinsurance Casualty
|
$
|
2,035,448
|
||
U.S. Reinsurance Property
|
2,291,749
|
|||
International Casualty
|
834,410
|
|||
International Property
|
1,116,288
|
|||
Bermuda Casualty
|
1,934,926
|
|||
Bermuda Property
|
659,771
|
|||
Insurance Casualty
|
2,192,111
|
|||
Insurance Property
|
250,508
|
|||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance
|
11,315,210
|
|||
Reinsurance recoverable on unpaid claims
|
||||
U.S. Reinsurance Casualty
|
395,446
|
|||
U.S. Reinsurance Property
|
232,957
|
|||
International Casualty
|
100,335
|
|||
International Property
|
99,430
|
|||
Bermuda Casualty
|
(25
|
)
|
||
Bermuda Property
|
143,752
|
|||
Insurance Casualty
|
520,754
|
|||
Insurance Property
|
126,992
|
|||
Total reinsurance recoverable on unpaid claims
|
1,619,641
|
|||
Insurance lines other than short-duration
|
-
|
|||
Unallocated claims adjustment expenses
|
144,554
|
|||
Other
|
39,685
|
|||
184,239
|
||||
Total gross liability for unpaid claims and claim adjustment expense
|
$
|
13,119,090
|
||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Gross basis:
|
||||||||||||
Beginning of period reserves
|
$
|
448,994
|
$
|
441,111
|
$
|
433,117
|
||||||
Incurred losses
|
(2,473
|
)
|
90,009
|
73,336
|
||||||||
Paid losses
|
(99,026
|
)
|
(82,126
|
)
|
(65,342
|
)
|
||||||
End of period reserves
|
$
|
347,495
|
$
|
448,994
|
$
|
441,111
|
||||||
Net basis:
|
||||||||||||
Beginning of period reserves
|
$
|
318,081
|
$
|
319,072
|
$
|
319,620
|
||||||
Incurred losses
|
-
|
37,137
|
53,909
|
|||||||||
Paid losses
|
(56,624
|
)
|
(38,128
|
)
|
(54,457
|
)
|
||||||
End of period reserves
|
$
|
261,456
|
$
|
318,081
|
$
|
319,072
|
At December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Balance at beginning of year
|
$
|
51,014
|
$
|
55,074
|
$
|
58,910
|
||||||
Liabilities assumed
|
110
|
115
|
175
|
|||||||||
Adjustments to reserves
|
806
|
(437
|
)
|
303
|
||||||||
Benefits paid in the current year
|
(5,151
|
)
|
(3,738
|
)
|
(4,315
|
)
|
||||||
Balance at end of year
|
$
|
46,778
|
$
|
51,014
|
$
|
55,074
|
||||||
(Some amounts may not reconcile due to rounding.)
|
Level 1: |
Inputs to the valuation methodology are observable inputs that reflect unadjusted quoted prices for identical assets or liabilities in an active
market;
|
Level 2: |
Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the
asset or liability, either directly or indirectly, for substantially the full term of the financial instrument;
|
Level 3: |
Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
|
·
|
U.S. Treasury securities and obligations of U.S. government agencies and corporations are primarily comprised of U.S.
Treasury bonds and the fair value is based on observable market inputs such as quoted prices, reported trades, quoted prices for similar issuances or benchmark yields;
|
·
|
Obligations of U.S. states and political subdivisions are comprised of state and municipal bond issuances and the fair
values are based on observable market inputs such as quoted market prices, quoted prices for similar securities, benchmark yields and credit spreads;
|
·
|
Corporate securities are primarily comprised of U.S. corporate and public utility bond issuances and the fair values
are based on observable market inputs such as quoted market prices, quoted prices for similar securities, benchmark yields and credit spreads;
|
·
|
Asset-backed and mortgage-backed securities fair values are based on observable inputs such as quoted prices, reported
trades, quoted prices for similar issuances or benchmark yields and cash flow models using observable inputs such as prepayment speeds, collateral performance and default spreads;
|
·
|
Foreign government securities are comprised of global non-U.S. sovereign bond issuances and the fair values are based
on observable market inputs such as quoted market prices, quoted prices for similar securities and models with observable inputs such as benchmark yields and credit spreads and then, where applicable, converted to
U.S. dollars using an exchange rate from a nationally recognized source;
|
·
|
Foreign corporate securities are comprised of global non-U.S. corporate bond issuances and the fair values are based
on observable market inputs such as quoted market prices, quoted prices for similar securities and models with observable inputs such as benchmark yields and credit spreads and then, where applicable, converted to
U.S. dollars using an exchange rate from a nationally recognized source.
|
Fair Value Measurement Using:
|
||||||||||||||||
Quoted Prices
|
||||||||||||||||
in Active
|
Significant
|
|||||||||||||||
Markets for
|
Other
|
Significant
|
||||||||||||||
Identical
|
Observable
|
Unobservable
|
||||||||||||||
Assets
|
Inputs
|
Inputs
|
||||||||||||||
(Dollars in thousands)
|
December 31, 2018
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
||||||||||||
Assets:
|
||||||||||||||||
Fixed maturities, market value
|
||||||||||||||||
U.S. Treasury securities and obligations of
|
||||||||||||||||
U.S. government agencies and corporations
|
$
|
2,631,134
|
$
|
-
|
$
|
2,631,134
|
$
|
-
|
||||||||
Obligations of U.S. States and political subdivisions
|
500,094
|
-
|
500,094
|
-
|
||||||||||||
Corporate securities
|
5,445,532
|
-
|
5,017,317
|
428,215
|
||||||||||||
Asset-backed securities
|
540,097
|
-
|
540,097
|
-
|
||||||||||||
Mortgage-backed securities
|
||||||||||||||||
Commercial
|
326,710
|
-
|
326,710
|
-
|
||||||||||||
Agency residential
|
1,796,264
|
-
|
1,796,264
|
-
|
||||||||||||
Non-agency residential
|
10,209
|
-
|
10,209
|
-
|
||||||||||||
Foreign government securities
|
1,314,165
|
-
|
1,314,165
|
-
|
||||||||||||
Foreign corporate securities
|
2,661,058
|
-
|
2,653,314
|
7,744
|
||||||||||||
Total fixed maturities, market value
|
15,225,263
|
-
|
14,789,304
|
435,959
|
||||||||||||
Fixed maturities, fair value
|
2,337
|
-
|
-
|
2,337
|
||||||||||||
Equity securities, fair value
|
716,639
|
674,433
|
42,206
|
-
|
||||||||||||
Liabilities:
|
||||||||||||||||
Equity index put option contracts
|
$
|
11,958
|
$
|
-
|
$
|
-
|
$
|
11,958
|
Fair Value Measurement Using:
|
||||||||||||||||
Quoted Prices
|
||||||||||||||||
in Active
|
Significant
|
|||||||||||||||
Markets for
|
Other
|
Significant
|
||||||||||||||
Identical
|
Observable
|
Unobservable
|
||||||||||||||
Assets
|
Inputs
|
Inputs
|
||||||||||||||
(Dollars in thousands)
|
December 31, 2017
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
||||||||||||
Assets:
|
||||||||||||||||
Fixed maturities, market value
|
||||||||||||||||
U.S. Treasury securities and obligations of
|
||||||||||||||||
U.S. government agencies and corporations
|
$
|
1,536,692
|
$
|
-
|
$
|
1,536,692
|
$
|
-
|
||||||||
Obligations of U.S. States and political subdivisions
|
585,469
|
-
|
585,469
|
-
|
||||||||||||
Corporate securities
|
5,699,005
|
-
|
5,488,819
|
210,186
|
||||||||||||
Asset-backed securities
|
531,360
|
-
|
531,360
|
-
|
||||||||||||
Mortgage-backed securities
|
||||||||||||||||
Commercial
|
234,041
|
-
|
234,041
|
-
|
||||||||||||
Agency residential
|
2,210,902
|
-
|
2,210,902
|
-
|
||||||||||||
Non-agency residential
|
494
|
-
|
494
|
-
|
||||||||||||
Foreign government securities
|
1,314,027
|
-
|
1,314,027
|
-
|
||||||||||||
Foreign corporate securities
|
2,644,844
|
-
|
2,637,892
|
6,952
|
||||||||||||
Total fixed maturities, market value
|
14,756,834
|
-
|
14,539,696
|
217,138
|
||||||||||||
Equity securities, market value
|
129,530
|
113,506
|
16,024
|
-
|
||||||||||||
Equity securities, fair value
|
963,572
|
941,739
|
21,833
|
-
|
||||||||||||
Liabilities:
|
||||||||||||||||
Equity index put option contracts
|
$
|
12,477
|
$
|
-
|
$
|
-
|
$
|
12,477
|
Total Fixed Maturities, Market Value
|
||||||||||||||||||||||||
December 31, 2018
|
December 31, 2017
|
|||||||||||||||||||||||
Corporate
|
Foreign
|
Corporate
|
Foreign
|
|||||||||||||||||||||
(Dollars in thousands)
|
Securities
|
Corporate
|
Total
|
Securities
|
Corporate
|
Total
|
||||||||||||||||||
Beginning balance fixed maturities at market value
|
$
|
210,186
|
$
|
6,952
|
$
|
217,138
|
$
|
65,197
|
$
|
2,538
|
$
|
67,735
|
||||||||||||
Total gains or (losses) (realized/unrealized)
|
||||||||||||||||||||||||
Included in earnings
|
(92
|
)
|
(660
|
)
|
(752
|
)
|
1,655
|
356
|
2,011
|
|||||||||||||||
Included in other comprehensive income (loss)
|
1,091
|
-
|
1,091
|
(992
|
)
|
46
|
(946
|
)
|
||||||||||||||||
Purchases, issuances and settlements
|
215,838
|
(298
|
)
|
215,540
|
144,326
|
4,800
|
149,126
|
|||||||||||||||||
Transfers in and/or (out) of Level 3
|
1,192
|
1,750
|
2,942
|
-
|
(788
|
)
|
(788
|
)
|
||||||||||||||||
Ending balance
|
$
|
428,215
|
$
|
7,744
|
$
|
435,959
|
$
|
210,186
|
$
|
6,952
|
$
|
217,138
|
||||||||||||
The amount of total gains or losses for the period included in earnings
|
||||||||||||||||||||||||
(or changes in net assets) attributable to the change in unrealized
|
||||||||||||||||||||||||
gains or losses relating to assets still held at the reporting date
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||||||
(Some amounts may not reconcile due to rounding.)
|
Total Fixed Maturities, Fair Value
|
||||||||||||||||
December 31, 2018
|
December 31, 2017
|
|||||||||||||||
Foreign
|
Foreign
|
|||||||||||||||
(Dollars in thousands)
|
Corporate
|
Total
|
Corporate
|
Total
|
||||||||||||
Beginning balance fixed maturities at fair value
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||
Total gains or (losses) (realized/unrealized)
|
||||||||||||||||
Included in earnings
|
(293
|
)
|
(293
|
)
|
-
|
-
|
||||||||||
Included in other comprehensive income (loss)
|
-
|
-
|
-
|
-
|
||||||||||||
Purchases, issuances and settlements
|
2,630
|
2,630
|
-
|
-
|
||||||||||||
Transfers in and/or (out) of Level 3
|
-
|
-
|
-
|
-
|
||||||||||||
Ending balance
|
$
|
2,337
|
$
|
2,337
|
$
|
-
|
$
|
-
|
||||||||
The amount of total gains or losses for the period included in earnings
|
||||||||||||||||
(or changes in net assets) attributable to the change in unrealized
|
||||||||||||||||
gains or losses relating to assets still held at the reporting date
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Liabilities:
|
||||||||
Balance, beginning of period
|
$
|
12,477
|
$
|
22,059
|
||||
Total (gains) or losses (realized/unrealized)
|
||||||||
Included in earnings
|
(520
|
)
|
(9,581
|
)
|
||||
Included in other comprehensive income (loss)
|
-
|
-
|
||||||
Purchases, issuances and settlements
|
-
|
-
|
||||||
Transfers in and/or (out) of Level 3
|
-
|
-
|
||||||
Balance, end of period
|
$
|
11,958
|
$
|
12,477
|
||||
The amount of total gains or losses for the period included in earnings
|
||||||||
(or changes in net assets) attributable to the change in unrealized
|
||||||||
gains or losses relating to liabilities still held at the reporting date
|
$
|
-
|
$
|
-
|
||||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Credit facility fees incurred
|
$
|
420
|
$
|
420
|
$
|
793
|
(Dollars in thousands)
|
At December 31, 2018
|
At December 31, 2017
|
|||||||||||||||||
Bank
|
|
Commitment
|
In Use
|
Date of Expiry
|
Commitment
|
In Use
|
Date of Expiry
|
||||||||||||
Wells Fargo Bank Group Credit Facility
|
Tranche One
|
$
|
200,000
|
$
|
-
|
$
|
200,000
|
$
|
-
|
||||||||||
Tranche Two |
600,000
|
558,818
|
12/31/2019
|
600,000
|
538,214
|
12/31/2018
|
|||||||||||||
Total Wells Fargo Bank Group Credit Facility
|
$
|
800,000
|
$
|
558,818
|
$
|
800,000
|
$
|
538,214
|
(Dollars in thousands)
|
At December 31, 2018
|
At December 31, 2017
|
||||||||||||||||||
Bank
|
Commitment
|
In Use
|
Date of Expiry
|
Commitment
|
In Use
|
Date of Expiry
|
||||||||||||||
Citibank Bilateral Letter of Credit Agreement
|
$
|
200,000
|
$
|
3,482
|
2/28/2019
|
$
|
250,000
|
$
|
3,297
|
2/28/2018
|
||||||||||
3,672
|
11/24/2019
|
3,672
|
11/24/2018
|
|||||||||||||||||
72,443
|
12/31/2019
|
73,626
|
12/31/2018
|
|||||||||||||||||
296
|
8/15/2020
|
344
|
8/30/2019
|
|||||||||||||||||
177
|
12/16/2020
|
93,855
|
12/30/2021
|
|||||||||||||||||
125
|
12/20/2020
|
-
|
|
|||||||||||||||||
1,851
|
11/4/2022
|
-
|
|
|||||||||||||||||
407
|
11/13/2022
|
-
|
|
|||||||||||||||||
59,293
|
12/30/2022
|
-
|
|
|||||||||||||||||
Total Citibank Bilateral Agreement
|
$
|
200,000
|
$
|
141,746
|
$
|
250,000
|
$
|
174,794
|
(Dollars in thousands)
|
At December 31, 2018
|
At December 31, 2017
|
||||||||||||||||
Bank
|
Commitment
|
In Use
|
Date of Expiry
|
Commitment
|
In Use
|
Date of Expiry
|
||||||||||||
Lloyd's Bank plc
|
£
|
30,000
|
£
|
26,000
|
12/31/2022
|
£
|
145,000
|
£
|
-
|
|||||||||
-
|
-
|
-
|
-
|
|||||||||||||||
Total Lloyd's Bank Credit Facility
|
£
|
30,000
|
£
|
26,000
|
£
|
145,000
|
£
|
-
|
December 31, 2018
|
December 31, 2017
|
||||||||||||||||||||||
Consolidated Balance
|
Consolidated Balance
|
||||||||||||||||||||||
(Dollars in thousands)
|
Date Issued
|
Date Due
|
Principal Amounts
|
Sheet Amount
|
Market Value
|
Sheet Amount
|
Market Value
|
||||||||||||||||
Senior notes
|
06/05/2014
|
06/01/2044
|
400,000
|
$
|
396,954
|
$
|
396,968
|
$
|
396,834
|
$
|
420,340
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Interest expense incurred
|
$
|
19,472
|
$
|
19,472
|
$
|
19,472
|
Maturity Date
|
December 31, 2018
|
December 31, 2017
|
||||||||||||||||||||||
Original
|
Consolidated Balance
|
Consolidated Balance
|
||||||||||||||||||||||
(Dollars in thousands)
|
Date Issued
|
Principal Amount
|
Scheduled
|
Final
|
Sheet Amount
|
Market Value
|
Sheet Amount
|
Market Value
|
||||||||||||||||
Long term subordinated notes
|
04/26/2007
|
$
|
400,000
|
05/15/2037
|
05/01/2067
|
$
|
236,659
|
$
|
200,390
|
$
|
236,561
|
$
|
233,072
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Interest expense incurred
|
$
|
10,926
|
$
|
11,498
|
$
|
15,749
|
Years Ended December 31,
|
||||||
Mt. Logan Re Segregated Accounts
|
2018
|
2017
|
2016
|
|||
(Dollars in thousands)
|
||||||
Ceded written premiums
|
242,755
|
228,514
|
197,537
|
|||
Ceded earned premiums
|
247,334
|
226,505
|
191,568
|
|||
Ceded losses and LAE
|
311,274
|
323,664
|
44,802
|
|||
Assumed written premiums
|
10,582
|
11,984
|
14,563
|
|||
Assumed earned premiums
|
10,582
|
11,984
|
14,563
|
|||
Assumed losses and LAE
|
-
|
-
|
-
|
(Dollars in thousands)
|
||||
2019
|
$
|
18,992
|
||
2020
|
18,365
|
|||
2021
|
9,469
|
|||
2022
|
9,180
|
|||
2023
|
8,919
|
|||
Thereafter
|
26,916
|
|||
Net commitments
|
$
|
91,841
|
||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Current tax expense (benefit):
|
||||||||||||
U.S.
|
$
|
(38,625
|
)
|
$
|
(117,173
|
)
|
$
|
30,971
|
||||
Non-U.S.
|
6,497
|
2,849
|
4,228
|
|||||||||
Total current tax expense (benefit)
|
(32,128
|
)
|
(114,324
|
)
|
35,199
|
|||||||
Deferred tax expense (benefit):
|
||||||||||||
U.S.
|
(297,798
|
)
|
49,763
|
70,995
|
||||||||
Non-U.S.
|
(97
|
)
|
777
|
(2,694
|
)
|
|||||||
Total deferred tax expense (benefit)
|
(297,895
|
)
|
50,540
|
68,301
|
||||||||
Total income tax expense (benefit)
|
$
|
(330,023
|
)
|
$
|
(63,784
|
)
|
$
|
103,500
|
||||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
||||||||||||||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||||||||||||||
U.S.
|
Non-U.S.
|
U.S.
|
Non-U.S.
|
U.S.
|
Non-U.S.
|
|||||||||||||||||||
Underwriting gain (loss)
|
$
|
(1,407,020
|
)
|
$
|
796,745
|
$
|
(516,167
|
)
|
$
|
308,646
|
$
|
208,821
|
$
|
480,602
|
||||||||||
Net investment income
|
283,569
|
297,614
|
255,310
|
287,588
|
230,691
|
242,393
|
||||||||||||||||||
Net realized capital gains (losses)
|
(90,033
|
)
|
(37,103
|
)
|
148,099
|
5,095
|
(16,465
|
)
|
9,249
|
|||||||||||||||
Net derivative gain (loss)
|
-
|
520
|
-
|
9,581
|
-
|
18,647
|
||||||||||||||||||
Corporate expenses
|
(11,035
|
)
|
(19,637
|
)
|
(7,394
|
)
|
(18,529
|
)
|
(8,276
|
)
|
(18,955
|
)
|
||||||||||||
Interest, fee and bond issue cost amortization expense
|
(30,611
|
)
|
(420
|
)
|
(31,183
|
)
|
(420
|
)
|
(35,435
|
)
|
(793
|
)
|
||||||||||||
Other income (expense)
|
(177
|
)
|
(8,883
|
)
|
30,325
|
(65,767
|
)
|
(5,536
|
)
|
(5,101
|
)
|
|||||||||||||
Pre-tax income (loss)
|
$
|
(1,255,307
|
)
|
$
|
1,028,836
|
$
|
(121,010
|
)
|
$
|
526,194
|
$
|
373,801
|
$
|
726,043
|
||||||||||
Expected tax provision at the applicable statutory rate(s)
|
(263,712
|
)
|
9,647
|
(42,355
|
)
|
6,843
|
130,830
|
2,387
|
||||||||||||||||
Increase (decrease) in taxes resulting from:
|
||||||||||||||||||||||||
Tax exempt income
|
(3,824
|
)
|
-
|
(8,488
|
)
|
-
|
(9,078
|
)
|
-
|
|||||||||||||||
Dividend received deduction
|
(1,520
|
)
|
-
|
(4,639
|
)
|
-
|
(4,913
|
)
|
-
|
|||||||||||||||
Proration
|
1,150
|
-
|
1,760
|
-
|
1,931
|
-
|
||||||||||||||||||
Affiliated preferred stock dividends
|
6,517
|
-
|
10,861
|
-
|
10,861
|
-
|
||||||||||||||||||
Creditable foreign premium tax
|
(13,475
|
)
|
-
|
(7,515
|
)
|
-
|
(6,134
|
)
|
-
|
|||||||||||||||
Tax audit settlement
|
(2,094
|
)
|
-
|
(11,516
|
)
|
-
|
(18,644
|
)
|
-
|
|||||||||||||||
U.S. rate differential on carryback of net operation losses to PY
|
(43,734
|
)
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||
U.S. rate differential on deferred tax 2017 return to provision
|
(28,411
|
)
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||
Share based compensation tax benefits formerly in APIC
|
(3,333
|
)
|
(120
|
)
|
(6,716
|
)
|
(235
|
)
|
-
|
-
|
||||||||||||||
Impact of U.S. tax reform
|
-
|
-
|
8,246
|
-
|
-
|
-
|
||||||||||||||||||
Impact of prior year accounting adjustment
|
-
|
-
|
(8,986
|
)
|
-
|
-
|
-
|
|||||||||||||||||
Change in uncertain tax positions
|
8,434
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||
Other
|
7,579
|
(3,127
|
)
|
1,938
|
(2,982
|
)
|
(2,887
|
)
|
(853
|
)
|
||||||||||||||
Total income tax provision
|
$
|
(336,423
|
)
|
$
|
6,400
|
$
|
(67,410
|
)
|
$
|
3,626
|
$
|
101,966
|
$
|
1,534
|
||||||||||
(Some amounts may not reconcile due to rounding.)
|
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Balance at January 1
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||
Additions based on tax positions related to the current year
|
-
|
-
|
-
|
|||||||||
Additions for tax positions of prior years
|
8,434
|
-
|
-
|
|||||||||
Reductions for tax positions of prior years
|
-
|
-
|
-
|
|||||||||
Settlements with taxing authorities
|
-
|
-
|
-
|
|||||||||
Lapses of applicable statutes of limitations
|
-
|
-
|
-
|
|||||||||
Balance at December 31
|
$
|
8,434
|
$
|
-
|
$
|
-
|
Years Ended December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Deferred tax assets:
|
||||||||
Foreign Tax Credits
|
$
|
167,685
|
$
|
15,914
|
||||
Net operating loss carryforward
|
105,787
|
9,645
|
||||||
Loss reserves
|
64,135
|
52,649
|
||||||
Unearned premium reserves
|
63,309
|
55,034
|
||||||
Net unrealized losses on benefit plans
|
17,921
|
19,120
|
||||||
Unrealized foreign currency losses
|
12,596
|
1,550
|
||||||
Net unrealized investment losses
|
10,815
|
-
|
||||||
Net fair value losses
|
7,196
|
-
|
||||||
Uncollectible reinsurance reserves
|
3,142
|
3,320
|
||||||
Deferred expenses
|
1,992
|
1,759
|
||||||
Investment impairments
|
1,291
|
1,144
|
||||||
Benefit plan liability
|
-
|
10,417
|
||||||
Alternative minimum tax credits
|
-
|
363
|
||||||
Other assets
|
9,529
|
10,494
|
||||||
Total deferred tax assets
|
465,398
|
181,409
|
||||||
Deferred tax liabilities:
|
||||||||
Deferred acquisition costs
|
74,736
|
64,997
|
||||||
Partnership investments
|
14,936
|
2,149
|
||||||
Benefit plan asset
|
3,600
|
-
|
||||||
Net fair value income
|
-
|
58,983
|
||||||
Net unrealized investment gains
|
-
|
11,576
|
||||||
Gain on tender of debt
|
-
|
3,287
|
||||||
Other liabilities
|
3,868
|
2,174
|
||||||
Total deferred tax liabilities
|
97,140
|
143,165
|
||||||
Net deferred tax assets
|
368,258
|
38,244
|
||||||
Less: Valuation allowance
|
(9,309
|
)
|
(9,560
|
)
|
||||
Total net deferred tax assets
|
$
|
358,949
|
$
|
28,684
|
||||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Written premiums:
|
||||||||||||
Direct
|
$
|
2,240,951
|
$
|
2,083,555
|
$
|
1,819,588
|
||||||
Assumed
|
6,234,203
|
5,090,367
|
4,214,286
|
|||||||||
Ceded
|
(1,060,726
|
)
|
(929,261
|
)
|
(762,969
|
)
|
||||||
Net written premiums
|
$
|
7,414,428
|
$
|
6,244,661
|
$
|
5,270,905
|
||||||
Premiums earned:
|
||||||||||||
Direct
|
$
|
2,129,320
|
$
|
1,825,705
|
$
|
1,694,702
|
||||||
Assumed
|
5,807,332
|
4,945,522
|
4,361,944
|
|||||||||
Ceded
|
(1,004,953
|
)
|
(833,387
|
)
|
(736,180
|
)
|
||||||
Net premiums earned
|
$
|
6,931,699
|
$
|
5,937,840
|
$
|
5,320,466
|
||||||
Incurred losses and LAE:
|
||||||||||||
Direct
|
$
|
1,372,589
|
$
|
1,311,682
|
$
|
1,496,455
|
||||||
Assumed
|
5,046,947
|
3,909,816
|
2,121,902
|
|||||||||
Ceded
|
(768,133
|
)
|
(698,917
|
)
|
(478,728
|
)
|
||||||
Net incurred losses and LAE
|
$
|
5,651,403
|
$
|
4,522,581
|
$
|
3,139,629
|
Years Ended December 31,
|
||||||||||||||||||||||||||||||||||||
2018
|
2017
|
2016
|
||||||||||||||||||||||||||||||||||
(Dollars in thousands)
|
Before Tax
|
Tax Effect
|
Net of Tax
|
Before Tax
|
Tax Effect
|
Net of Tax
|
Before Tax
|
Tax Effect
|
Net of Tax
|
|||||||||||||||||||||||||||
Unrealized appreciation (depreciation) ("URA(D)") on securities - temporary
|
$
|
(275,511
|
)
|
$
|
21,061
|
$
|
(254,450
|
)
|
$
|
(81,915
|
)
|
$
|
21,597
|
$
|
(60,318
|
)
|
$
|
65,645
|
$
|
(13,961
|
)
|
$
|
51,684
|
|||||||||||||
URA(D) on securities - OTTI
|
(1,071
|
)
|
(135
|
)
|
(1,206
|
)
|
(5,618
|
)
|
1,588
|
(4,030
|
)
|
7,734
|
(1,789
|
)
|
5,945
|
|||||||||||||||||||||
Reclassification of net realized losses (gains) included in net income (loss)
|
28,014
|
(518
|
)
|
27,496
|
(7,258
|
)
|
308
|
(6,950
|
)
|
23,232
|
(8,114
|
)
|
15,118
|
|||||||||||||||||||||||
Foreign currency translation adjustments
|
(86,520
|
)
|
9,704
|
(76,816
|
)
|
142,054
|
(20,137
|
)
|
121,917
|
(53,802
|
)
|
(1,539
|
)
|
(55,341
|
)
|
|||||||||||||||||||||
Benefit plan actuarial net gain (loss)
|
(646
|
)
|
136
|
(510
|
)
|
1,300
|
(273
|
)
|
1,027
|
(11,520
|
)
|
4,032
|
(7,488
|
)
|
||||||||||||||||||||||
Reclassification of benefit plan liability amortization included in net income (loss)
|
6,356
|
(1,335
|
)
|
5,021
|
8,426
|
(2,949
|
)
|
5,477
|
7,805
|
(2,732
|
)
|
5,073
|
||||||||||||||||||||||||
Total other comprehensive income (loss)
|
$
|
(329,378
|
)
|
$
|
28,913
|
$
|
(300,465
|
)
|
$
|
56,989
|
$
|
134
|
$
|
57,123
|
$
|
39,094
|
$
|
(24,103
|
)
|
$
|
14,991
|
Years Ended December 31,
|
Affected line item within the statements of
|
|||||||||
AOCI component
|
2018
|
2017
|
operations and comprehensive income (loss)
|
|||||||
(Dollars in thousands)
|
||||||||||
URA(D) on securities
|
$
|
28,014
|
$
|
(7,258
|
)
|
Other net realized capital gains (losses)
|
||||
(518
|
)
|
308
|
Income tax expense (benefit)
|
|||||||
$
|
27,496
|
$
|
(6,950
|
)
|
Net income (loss)
|
|||||
Benefit plan net gain (loss)
|
$
|
6,356
|
$
|
8,426
|
Other underwriting expenses
|
|||||
(1,335
|
)
|
(2,949
|
)
|
Income tax expense (benefit)
|
||||||
$
|
5,021
|
$
|
5,477
|
Net income (loss)
|
Years Ended December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Beginning balance of URA (D) on securities
|
$
|
49,969
|
$
|
115,558
|
||||
Change to beginning balance due to adoption of ASU 2016-01
|
(1,201
|
)
|
-
|
|||||
Current period change in URA (D) of investments - temporary
|
(226,954
|
)
|
(67,268
|
)
|
||||
Current period change in URA (D) of investments - non-credit OTTI
|
(1,206
|
)
|
(4,030
|
)
|
||||
Reclass due to early adoption of ASU 2018-02
|
-
|
5,709
|
||||||
Ending balance of URA (D) on securities
|
(179,392
|
)
|
49,969
|
|||||
Beginning balance of foreign currency translation adjustments
|
(138,931
|
)
|
(266,818
|
)
|
||||
Current period change in foreign currency translation adjustments
|
(76,816
|
)
|
121,917
|
|||||
Reclass due to early adoption of ASU 2018-02
|
-
|
5,970
|
||||||
Ending balance of foreign currency translation adjustments
|
(215,747
|
)
|
(138,931
|
)
|
||||
Beginning balance of benefit plan net gain (loss)
|
(71,929
|
)
|
(65,504
|
)
|
||||
Current period change in benefit plan net gain (loss)
|
4,511
|
6,504
|
||||||
Reclass due to early adoption of ASU 2018-02
|
-
|
(12,929
|
)
|
|||||
Ending balance of benefit plan net gain (loss)
|
(67,418
|
)
|
(71,929
|
)
|
||||
Ending balance of accumulated other comprehensive income (loss)
|
$
|
(462,557
|
)
|
$
|
(160,891
|
)
|
||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Company contributions
|
$
|
77,743
|
$
|
10,534
|
$
|
30,821
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Pension expense
|
$
|
9,728
|
$
|
16,299
|
$
|
17,188
|
Years Ended December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Change in projected benefit obligation:
|
||||||||
Benefit obligation at beginning of year
|
$
|
316,202
|
$
|
281,853
|
||||
Service cost
|
9,801
|
10,949
|
||||||
Interest cost
|
10,290
|
10,034
|
||||||
Actuarial (gain)/loss
|
(29,966
|
)
|
24,679
|
|||||
Curtailment
|
-
|
(6,209
|
)
|
|||||
Benefits paid
|
(6,084
|
)
|
(5,104
|
)
|
||||
Projected benefit obligation at end of year
|
300,244
|
316,202
|
||||||
Change in plan assets:
|
||||||||
Fair value of plan assets at beginning of year
|
210,267
|
171,506
|
||||||
Actual return on plan assets
|
(21,395
|
)
|
33,331
|
|||||
Actual contributions during the year
|
77,743
|
10,534
|
||||||
Administrative expenses paid
|
-
|
-
|
||||||
Benefits paid
|
(6,084
|
)
|
(5,104
|
)
|
||||
Fair value of plan assets at end of year
|
260,531
|
210,267
|
||||||
Funded status at end of year
|
$
|
(39,713
|
)
|
$
|
(105,935
|
)
|
||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Other assets (due beyond one year)
|
$
|
-
|
$
|
-
|
||||
Other liabilities (due within one year)
|
(7,530
|
)
|
(3,871
|
)
|
||||
Other liabilities (due beyond one year)
|
(32,182
|
)
|
(102,065
|
)
|
||||
Net amount recognized in the consolidated balance sheets
|
$
|
(39,713
|
)
|
$
|
(105,935
|
)
|
||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Accumulated income (loss)
|
$
|
(88,580
|
)
|
$
|
(86,788
|
)
|
||
Accumulated other comprehensive income (loss)
|
$
|
(88,580
|
)
|
$
|
(86,788
|
)
|
||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Other comprehensive income (loss) at December 31, prior year
|
$
|
(86,788
|
)
|
$
|
(96,965
|
)
|
||
Net gain (loss) arising during period
|
(8,631
|
)
|
(4,398
|
)
|
||||
Recognition of amortizations in net periodic benefit cost:
|
||||||||
Actuarial loss
|
6,839
|
8,366
|
||||||
Curtailment loss recognized
|
-
|
6,209
|
||||||
Other comprehensive income (loss) at December 31, current year
|
$
|
(88,580
|
)
|
$
|
(86,788
|
)
|
||
(Some amounts may not reconcile due to rounding.)
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Service cost
|
$
|
9,801
|
$
|
10,949
|
$
|
10,924
|
||||||
Interest cost
|
10,290
|
10,034
|
9,485
|
|||||||||
Expected return on assets
|
(17,202
|
)
|
(13,050
|
)
|
(11,158
|
)
|
||||||
Amortization of actuarial loss from earlier periods
|
6,839
|
8,366
|
7,937
|
|||||||||
Net periodic benefit cost
|
$
|
9,728
|
$
|
16,299
|
$
|
17,188
|
||||||
Other changes recognized in other comprehensive income (loss):
|
||||||||||||
Other comprehensive income (loss) attributable to change from prior year
|
1,792
|
(10,177
|
)
|
|||||||||
Total recognized in net periodic benefit cost and other
|
||||||||||||
comprehensive income (loss)
|
$
|
11,520
|
$
|
6,122
|
||||||||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Qualified Plan
|
$
|
237,855
|
$
|
245,430
|
||||
Non-qualified Plan
|
24,472
|
24,482
|
||||||
Total
|
$
|
262,327
|
$
|
269,912
|
||||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Qualified Plan
|
||||||||
Projected benefit obligation
|
$
|
275,772
|
$
|
291,720
|
||||
Fair value of plan assets
|
260,531
|
210,267
|
||||||
Non-qualified Plan
|
||||||||
Projected benefit obligation
|
$
|
24,472
|
$
|
24,482
|
||||
Fair value of plan assets
|
-
|
-
|
At December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Qualified Plan
|
||||||||
Accumulated benefit obligation
|
$
|
-
|
$
|
245,430
|
||||
Fair value of plan assets
|
-
|
210,267
|
||||||
Non-qualified Plan
|
||||||||
Accumulated benefit obligation
|
$
|
24,472
|
$
|
24,482
|
||||
Fair value of plan assets
|
-
|
-
|
(Dollars in thousands)
|
|||
2019
|
14,772
|
||
2020
|
13,087
|
||
2021
|
11,137
|
||
2022
|
12,104
|
||
2023
|
12,779
|
||
Next 5 years
|
79,289
|
Fair Value Measurement Using:
|
||||||||||||||||
Quoted Prices
|
||||||||||||||||
in Active
|
Significant
|
|||||||||||||||
Markets for
|
Other
|
Significant
|
||||||||||||||
Identical
|
Observable
|
Unobservable
|
||||||||||||||
Assets
|
Inputs
|
Inputs
|
||||||||||||||
(Dollars in thousands)
|
December 31, 2018
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
||||||||||||
Assets:
|
||||||||||||||||
Short-term investments, which approximates fair value (a)
|
$
|
2,872
|
$
|
2,872
|
$
|
-
|
$
|
-
|
||||||||
Mutual funds, fair value
|
||||||||||||||||
Fixed income (b)
|
82,633
|
82,633
|
-
|
-
|
||||||||||||
Equities (c)
|
154,935
|
154,935
|
-
|
-
|
||||||||||||
Total
|
$
|
240,440
|
$
|
240,440
|
$
|
-
|
$
|
-
|
||||||||
(Some amounts may not reconcile due to rounding.)
|
(a)
|
This category includes high quality, short-term money market instruments, which are issued and
payable in U.S. dollars.
|
(b)
|
This category includes fixed income funds, which invest in investment grade securities of
corporations, governments and government agencies with approximately 70% in U.S. securities and 30% in international securities.
|
(c)
|
This category includes funds, which invest in small, mid and multi-cap equity securities
including common stocks, securities convertible into common stock and securities with common stock characteristics, such as rights and warrants, with approximately 50% in U.S. equities and 50% in
international equities.
|
Fair Value Measurement Using:
|
||||||||||||||||
Quoted Prices
|
||||||||||||||||
in Active
|
Significant
|
|||||||||||||||
Markets for
|
Other
|
Significant
|
||||||||||||||
Identical
|
Observable
|
Unobservable
|
||||||||||||||
Assets
|
Inputs
|
Inputs
|
||||||||||||||
(Dollars in thousands)
|
December 31, 2017
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
||||||||||||
Assets:
|
||||||||||||||||
Short-term investments, which approximates fair value (a)
|
$
|
1,031
|
$
|
1,031
|
$
|
-
|
$
|
-
|
||||||||
Mutual funds, fair value
|
||||||||||||||||
Fixed income (b)
|
23,361
|
23,361
|
-
|
-
|
||||||||||||
Equities (c)
|
159,578
|
159,578
|
-
|
-
|
||||||||||||
Total
|
$
|
183,970
|
$
|
183,970
|
$
|
-
|
$
|
-
|
||||||||
(Some amounts may not reconcile due to rounding.)
|
(a)
|
This category includes high quality, short-term money market instruments, which are issued and
payable in U.S. dollars.
|
(b)
|
This category includes fixed income funds, which invest in investment grade securities of
corporations, governments and government agencies with approximately 50% in U.S. securities and 50% in international securities.
|
(c)
|
This category includes funds, which invest in small, mid and multi-cap equity securities
including common stocks, securities convertible into common stock and securities with common stock characteristics, such as rights and warrants, with approximately 90% in U.S. equities and 10% in
international equities.
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Incurred expenses
|
$
|
9,301
|
$
|
7,167
|
$
|
6,058
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Incurred expenses
|
$
|
2,057
|
$
|
1,849
|
$
|
1,560
|
Percentage
|
Percentage
|
|||||||
Point Increase
|
Point Decrease
|
|||||||
(Dollars in thousands)
|
($ Impact)
|
($ Impact)
|
||||||
a. Effect on total service and interest cost components
|
$
|
577
|
$
|
(436
|
)
|
|||
b. Effect on accumulated post-retirement benefit obligation
|
5,987
|
(4,643
|
)
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Post-retirement benefit expenses
|
$
|
1,829
|
$
|
2,814
|
$
|
2,293
|
At December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Change in projected benefit obligation:
|
||||||||
Benefit obligation at beginning of year
|
$
|
34,717
|
$
|
32,071
|
||||
Service cost
|
1,312
|
1,570
|
||||||
Interest cost
|
999
|
1,184
|
||||||
Amendments
|
-
|
(3,526
|
)
|
|||||
Actuarial (gain)/loss
|
(7,985
|
)
|
4,038
|
|||||
Benefits paid
|
(561
|
)
|
(619
|
)
|
||||
Benefit obligation at end of year
|
28,483
|
34,717
|
||||||
Change in plan assets:
|
||||||||
Fair value of plan assets at beginning of year
|
-
|
-
|
||||||
Employer contributions
|
561
|
619
|
||||||
Benefits paid
|
(561
|
)
|
(619
|
)
|
||||
Fair value of plan assets at end of year
|
-
|
-
|
||||||
Funded status at end of year
|
$
|
(28,483
|
)
|
$
|
(34,717
|
)
|
At December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Other liabilities (due within one year)
|
$
|
(608
|
)
|
$
|
(655
|
)
|
||
Other liabilities (due beyond one year)
|
(27,875
|
)
|
(34,062
|
)
|
||||
Net amount recognized in the consolidated balance sheets
|
$
|
(28,483
|
)
|
$
|
(34,717
|
)
|
||
(Some amounts may not reconcile due to rounding.)
|
At December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Accumulated income (loss)
|
$
|
(238
|
)
|
$
|
(8,317
|
)
|
||
Accumulated prior service credit (cost)
|
3,480
|
4,057
|
||||||
Accumulated other comprehensive income (loss)
|
$
|
3,242
|
$
|
(4,260
|
)
|
Years Ended December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
Other comprehensive income (loss) at December 31, prior year
|
$
|
(4,260
|
)
|
$
|
(3,809
|
)
|
||
Net gain (loss) arising during period
|
7,985
|
(4,038
|
)
|
|||||
Prior Service credit (cost) arising during period
|
-
|
3,526
|
||||||
Recognition of amortizations in net periodic benefit cost:
|
||||||||
Actuarial loss (gain)
|
94
|
192
|
||||||
Prior service cost
|
(577
|
)
|
(131
|
)
|
||||
Other comprehensive income (loss) at December 31, current year
|
$
|
3,242
|
$
|
(4,260
|
)
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Service cost
|
$
|
1,312
|
$
|
1,570
|
$
|
1,418
|
||||||
Interest cost
|
999
|
1,184
|
1,007
|
|||||||||
Prior service credit recognition
|
(577
|
)
|
(131
|
)
|
(132
|
)
|
||||||
Net gain recognition
|
94
|
192
|
-
|
|||||||||
Net periodic cost
|
$
|
1,829
|
$
|
2,814
|
$
|
2,293
|
||||||
Other changes recognized in other comprehensive income (loss):
|
||||||||||||
Other comprehensive gain (loss) attributable to change from prior year
|
(7,502
|
)
|
451
|
|||||||||
Total recognized in net periodic benefit cost and
|
||||||||||||
other comprehensive income (loss)
|
$
|
(5,673
|
)
|
$
|
3,265
|
|||||||
(Some amounts may not reconcile due to rounding.)
|
(Dollars in thousands)
|
||||
2019
|
$
|
608
|
||
2020
|
663
|
|||
2021
|
740
|
|||
2022
|
852
|
|||
2023
|
944
|
|||
Next 5 years
|
6,469
|
Bermuda Re (1)
|
Everest Re (2)
|
|||||||||||||||
At December 31,
|
At December 31,
|
|||||||||||||||
(Dollars in thousands)
|
2018 (3)
|
2017
|
2018
|
2017
|
||||||||||||
Regulatory targeted capital
|
$
|
-
|
$
|
2,368,620
|
$
|
2,172,958 |
$
|
2,076,892
|
||||||||
Actual capital
|
$
|
3,061,136
|
$
|
3,085,882
|
$
|
3,650,594
|
$
|
3,391,852
|
At December 31,
|
||||||||
(Dollars in thousands)
|
2018
|
2017
|
||||||
The Prudential Insurance Company of America
|
$
|
142,754
|
$
|
144,618
|
||||
Unaffiliated life insurance company
|
34,717
|
34,444
|
Weighted-
|
||||||||||||||||
Weighted-
|
Average
|
|||||||||||||||
Average
|
Remaining
|
Aggregate
|
||||||||||||||
(Aggregate Intrinsic Value in thousands)
|
Exercise
|
Contractual
|
Intrinsic
|
|||||||||||||
Options
|
Shares
|
Price/Share
|
Term
|
Value
|
||||||||||||
Outstanding at January 1, 2018
|
360,364
|
$
|
84.10
|
|||||||||||||
Granted
|
-
|
-
|
||||||||||||||
Exercised
|
81,200
|
84.99
|
||||||||||||||
Forfeited/Cancelled/Expired
|
-
|
-
|
||||||||||||||
Outstanding at December 31, 2018
|
279,164
|
83.84
|
1.9
|
$
|
37,386
|
|||||||||||
Exercisable at December 31, 2018
|
279,164
|
83.84
|
1.9
|
$
|
37,386
|
Weighted-
|
||||||||||||||||
Weighted-
|
Average
|
|||||||||||||||
Average
|
Remaining
|
Aggregate
|
||||||||||||||
(Aggregate Intrinsic Value in thousands)
|
Exercise
|
Contractual
|
Intrinsic
|
|||||||||||||
Options
|
Shares
|
Price/Share
|
Term
|
Value
|
||||||||||||
Outstanding at January 1, 2017
|
454,994
|
$
|
84.88
|
|||||||||||||
Granted
|
-
|
-
|
||||||||||||||
Exercised
|
94,630
|
87.84
|
||||||||||||||
Forfeited/Cancelled/Expired
|
-
|
-
|
||||||||||||||
Outstanding at December 31, 2017
|
360,364
|
84.10
|
2.7
|
$
|
49,428
|
|||||||||||
Exercisable at December 31, 2017
|
360,364
|
84.10
|
2.7
|
$
|
49,428
|
Weighted-
|
||||||||||||||||
Weighted-
|
Average
|
|||||||||||||||
Average
|
Remaining
|
Aggregate
|
||||||||||||||
(Aggregate Intrinsic Value in thousands)
|
Exercise
|
Contractual
|
Intrinsic
|
|||||||||||||
Options
|
Shares
|
Price/Share
|
Term
|
Value
|
||||||||||||
Outstanding at January 1, 2016
|
648,034
|
$
|
85.61
|
|||||||||||||
Granted
|
-
|
-
|
||||||||||||||
Exercised
|
187,940
|
87.31
|
||||||||||||||
Forfeited/Cancelled/Expired
|
5,100
|
88.25
|
||||||||||||||
Outstanding at December 31, 2016
|
454,994
|
84.88
|
3.7
|
$
|
59,843
|
|||||||||||
Exercisable at December 31, 2016
|
410,694
|
84.50
|
3.5
|
$
|
54,169
|
At December 31, 2018
|
||||||||||||||||||||
Options Outstanding
|
Options Exercisable
|
|||||||||||||||||||
Weighted-
|
||||||||||||||||||||
Average
|
Weighted-
|
Weighted-
|
||||||||||||||||||
Number
|
Remaining
|
Average
|
Number
|
Average
|
||||||||||||||||
Range of
|
Outstanding
|
Contractual
|
Exercise
|
Exercisable
|
Exercise
|
|||||||||||||||
Exercise Prices
|
at 12/31/18
|
Life
|
Price
|
at 12/31/18
|
Price
|
|||||||||||||||
$71.7150 - $78.1700
|
57,770
|
0.1
|
$
|
71.72
|
57,770
|
$
|
71.72
|
|||||||||||||
$78.1800 - $85.6300
|
51,300
|
1.1
|
84.63
|
51,300
|
84.63
|
|||||||||||||||
$85.6400 - $87.4700
|
73,140
|
2.2
|
86.62
|
73,140
|
86.62
|
|||||||||||||||
$87.4800 - $89.4100
|
91,000
|
3.1
|
88.32
|
91,000
|
88.32
|
|||||||||||||||
$89.4200 - $110.1300
|
5,954
|
2.5
|
91.99
|
5,954
|
91.99
|
|||||||||||||||
279,164
|
1.9
|
83.84
|
279,164
|
83.84
|
Years Ended December 31,
|
||||||||||||||||||||||||
2018
|
2017
|
2016
|
||||||||||||||||||||||
Weighted-
|
Weighted-
|
Weighted-
|
||||||||||||||||||||||
Average
|
Average
|
Average
|
||||||||||||||||||||||
Grant Date
|
Grant Date
|
Grant Date
|
||||||||||||||||||||||
Restricted (non-vested) Shares
|
Shares
|
Fair Value
|
Shares
|
Fair Value
|
Shares
|
Fair Value
|
||||||||||||||||||
Outstanding at January 1,
|
421,261
|
$
|
194.01
|
435,338
|
$
|
164.21
|
435,336
|
$
|
143.02
|
|||||||||||||||
Granted
|
173,065
|
240.59
|
160,185
|
234.01
|
173,546
|
186.37
|
||||||||||||||||||
Vested
|
141,982
|
178.31
|
152,397
|
151.80
|
145,834
|
130.54
|
||||||||||||||||||
Forfeited
|
37,937
|
212.48
|
21,865
|
187.82
|
27,710
|
147.32
|
||||||||||||||||||
Outstanding at December 31,
|
414,407
|
217.15
|
421,261
|
194.01
|
435,338
|
164.21
|
Year Ended December 31,
|
||||||||||||||||||||||||
2018
|
2017
|
2016
|
||||||||||||||||||||||
Weighted-
|
Weighted-
|
Weighted-
|
||||||||||||||||||||||
Average
|
Average
|
Average
|
||||||||||||||||||||||
Grant Date
|
Grant Date
|
Grant Date
|
||||||||||||||||||||||
Performance Share Unit Awards
|
Shares
|
Fair Value
|
Shares
|
Fair Value
|
Shares
|
Fair Value
|
||||||||||||||||||
Outstanding at January 1,
|
33,454
|
$
|
-
|
21,223
|
$
|
-
|
10,705
|
$
|
-
|
|||||||||||||||
Granted
|
13,325
|
242.39
|
11,245
|
234.03
|
11,130
|
186.02
|
||||||||||||||||||
Increase/(Decrease) on vesting units due to performance
|
(267
|
)
|
-
|
986
|
-
|
894
|
-
|
|||||||||||||||||
Vested
|
12,435
|
242.39
|
-
|
-
|
-
|
-
|
||||||||||||||||||
Forfeited
|
1,695
|
-
|
-
|
-
|
1,506
|
-
|
||||||||||||||||||
Outstanding at December 31,
|
32,382
|
-
|
33,454
|
-
|
21,223
|
-
|
U.S. Reinsurance
|
Years Ended December 31,
|
|||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Gross written premiums
|
$
|
3,014,338
|
$
|
2,592,972
|
$
|
2,125,792
|
||||||
Net written premiums
|
2,642,182
|
2,245,422
|
1,970,575
|
|||||||||
Premiums earned
|
$
|
2,528,991
|
$
|
2,181,160
|
$
|
2,072,155
|
||||||
Incurred losses and LAE
|
2,784,181
|
1,632,795
|
1,068,475
|
|||||||||
Commission and brokerage
|
568,374
|
462,487
|
465,953
|
|||||||||
Other underwriting expenses
|
60,266
|
55,881
|
54,107
|
|||||||||
Underwriting gain (loss)
|
$
|
(883,830
|
)
|
$
|
29,997
|
$
|
483,620
|
International
|
Years Ended December 31,
|
|||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Gross written premiums
|
$
|
1,543,946
|
$
|
1,316,701
|
$
|
1,230,683
|
||||||
Net written premiums
|
1,458,745
|
1,229,597
|
1,082,712
|
|||||||||
Premiums earned
|
$
|
1,439,882
|
$
|
1,202,043
|
$
|
1,119,121
|
||||||
Incurred losses and LAE
|
992,704
|
1,059,640
|
486,550
|
|||||||||
Commission and brokerage
|
364,010
|
287,688
|
283,447
|
|||||||||
Other underwriting expenses
|
39,042
|
38,844
|
35,512
|
|||||||||
Underwriting gain (loss)
|
$
|
44,126
|
$
|
(184,129
|
)
|
$
|
313,612
|
Bermuda
|
Years Ended December 31,
|
|||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Gross written premiums
|
$
|
1,666,317
|
$
|
1,205,001
|
$
|
890,375
|
||||||
Net written premiums
|
1,605,526
|
1,139,082
|
831,931
|
|||||||||
Premiums earned
|
$
|
1,324,198
|
$
|
1,093,250
|
$
|
837,964
|
||||||
Incurred losses and LAE
|
808,717
|
735,292
|
461,909
|
|||||||||
Commission and brokerage
|
319,197
|
303,707
|
233,989
|
|||||||||
Other underwriting expenses
|
43,566
|
38,011
|
36,331
|
|||||||||
Underwriting gain (loss)
|
$
|
152,718
|
$
|
16,240
|
$
|
105,735
|
Insurance
|
Years Ended December 31,
|
|||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Gross written premiums
|
$
|
2,250,552
|
$
|
2,059,248
|
$
|
1,787,024
|
||||||
Net written premiums
|
1,707,975
|
1,630,560
|
1,385,687
|
|||||||||
Premiums earned
|
$
|
1,638,628
|
$
|
1,461,387
|
$
|
1,291,226
|
||||||
Incurred losses and LAE
|
1,065,801
|
1,094,854
|
1,122,695
|
|||||||||
Commission and brokerage
|
267,449
|
250,081
|
205,303
|
|||||||||
Other underwriting expenses
|
228,667
|
186,081
|
176,772
|
|||||||||
Underwriting gain (loss)
|
$
|
76,711
|
$
|
(69,629
|
)
|
$
|
(213,544
|
)
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
Underwriting gain (loss)
|
$
|
(610,275
|
)
|
$
|
(207,521
|
)
|
$
|
689,423
|
||||
Net investment income
|
581,183
|
542,898
|
473,085
|
|||||||||
Net realized capital gains (losses)
|
(127,136
|
)
|
153,194
|
(7,216
|
)
|
|||||||
Net derivative gain (loss)
|
520
|
9,581
|
18,647
|
|||||||||
Corporate expenses
|
(30,672
|
)
|
(25,923
|
)
|
(27,231
|
)
|
||||||
Interest, fee and bond issue cost amortization expense
|
(31,031
|
)
|
(31,603
|
)
|
(36,228
|
)
|
||||||
Other income (expense)
|
(9,060
|
)
|
(35,442
|
)
|
(10,636
|
)
|
||||||
Income (loss) before taxes
|
$
|
(226,471
|
)
|
$
|
405,184
|
$
|
1,099,844
|
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
United Kingdom
|
$
|
914,612
|
$
|
730,826
|
$
|
688,598
|
2018
|
||||||||||||||||
(Dollars in thousands, except per share amounts)
|
1st Quarter
|
2nd Quarter
|
3rd Quarter
|
4th Quarter
|
||||||||||||
Operating data:
|
||||||||||||||||
Gross written premiums
|
$
|
1,931,607
|
$
|
2,066,521
|
$
|
2,198,664
|
$
|
2,278,361
|
||||||||
Net written premiums
|
1,672,206
|
1,746,378
|
1,938,773
|
2,057,071
|
||||||||||||
Premiums earned
|
1,619,427
|
1,729,818
|
1,731,479
|
1,850,975
|
||||||||||||
Net investment income
|
138,294
|
141,322
|
161,363
|
140,204
|
||||||||||||
Net realized capital gains (losses)
|
(24,901
|
)
|
15,776
|
54,804
|
(172,815
|
)
|
||||||||||
Total claims and underwriting expenses
|
1,511,100
|
1,817,815
|
1,731,201
|
2,481,858
|
||||||||||||
Net income (loss)
|
210,318
|
69,895
|
205,613
|
(382,274
|
)
|
|||||||||||
Earnings per common share attributable to Everest Re Group:
|
||||||||||||||||
Basic
|
$
|
5.14
|
$
|
1.71
|
$
|
5.04
|
$
|
(9.50
|
)
|
|||||||
Diluted
|
$
|
5.11
|
$
|
1.70
|
$
|
5.02
|
$
|
(9.50
|
)
|
2017
|
||||||||||||||||
(Dollars in thousands, except per share amounts)
|
1st Quarter
|
2nd Quarter
|
3rd Quarter
|
4th Quarter
|
||||||||||||
Operating data:
|
||||||||||||||||
Gross written premiums
|
$
|
1,600,944
|
$
|
1,601,649
|
$
|
2,044,902
|
$
|
1,926,427
|
||||||||
Net written premiums
|
1,413,814
|
1,339,133
|
1,798,089
|
1,693,625
|
||||||||||||
Premiums earned
|
1,312,097
|
1,369,681
|
1,598,875
|
1,657,187
|
||||||||||||
Net investment income
|
122,289
|
134,508
|
136,973
|
149,128
|
||||||||||||
Net realized capital gains (losses)
|
52,728
|
25,268
|
41,535
|
33,663
|
||||||||||||
Total claims and underwriting expenses
|
1,128,944
|
1,240,100
|
2,616,340
|
1,159,977
|
||||||||||||
Net income (loss)
|
291,643
|
245,674
|
(639,374
|
)
|
571,025
|
|||||||||||
Earnings per common share attributable to Everest Re Group:
|
||||||||||||||||
Basic
|
$
|
7.12
|
$
|
5.98
|
$
|
(15.73
|
)
|
$
|
13.92
|
|||||||
Diluted
|
$
|
7.07
|
$
|
5.95
|
$
|
(15.73
|
)
|
$
|
13.85
|
SCHEDULE I — SUMMARY OF INVESTMENTS —
|
||||||||||||
OTHER THAN INVESTMENTS IN RELATED PARTIES
|
||||||||||||
December 31, 2018
|
||||||||||||
Column A
|
Column B
|
Column C
|
Column D
|
|||||||||
Amount
|
||||||||||||
Shown in
|
||||||||||||
Market
|
Balance
|
|||||||||||
(Dollars in thousands)
|
Cost
|
Value
|
Sheet
|
|||||||||
Fixed maturities-available for sale
|
||||||||||||
Bonds:
|
||||||||||||
U.S. government and government agencies
|
$
|
2,629,454
|
$
|
2,631,134
|
$
|
2,631,134
|
||||||
State, municipalities and political subdivisions
|
490,018
|
500,094
|
500,094
|
|||||||||
Foreign government securities
|
1,335,328
|
1,314,165
|
1,314,165
|
|||||||||
Foreign corporate securities
|
2,694,922
|
2,661,058
|
2,661,058
|
|||||||||
Public utilities
|
287,784
|
283,903
|
283,903
|
|||||||||
All other corporate bonds
|
5,792,179
|
5,698,522
|
5,698,522
|
|||||||||
Mortgage - backed securities:
|
||||||||||||
Commercial
|
329,883
|
326,710
|
326,710
|
|||||||||
Agency residential
|
1,832,760
|
1,796,264
|
1,796,264
|
|||||||||
Non-agency residential
|
10,198
|
10,209
|
10,209
|
|||||||||
Redeemable preferred stock
|
4,046
|
3,204
|
3,204
|
|||||||||
Total fixed maturities-available for sale
|
15,406,572
|
15,225,263
|
15,225,263
|
|||||||||
Fixed maturities - available for sale at fair value
|
2,337
|
2,337
|
2,337
|
|||||||||
Equity securities - at fair value (1)
|
766,102
|
716,639
|
716,639
|
|||||||||
Short-term investments
|
241,010
|
240,987
|
240,987
|
|||||||||
Other invested assets
|
1,591,745
|
1,591,745
|
1,591,745
|
|||||||||
Cash
|
656,095
|
656,095
|
656,095
|
|||||||||
Total investments and cash
|
$
|
18,663,861
|
$
|
18,433,066
|
$
|
18,433,066
|
||||||
(1) Original cost does not reflect fair value adjustments, which have been realized through the statements of operations and comprehensive income (loss).
|
SCHEDULE II — CONDENSED FINANCIAL INFORMATION OF THE REGISTRANT
|
||||||||
CONDENSED BALANCE SHEETS
|
||||||||
December 31,
|
||||||||
(Dollars and share amounts in thousands, except par value per share)
|
2018
|
2017
|
||||||
ASSETS:
|
||||||||
Fixed maturities - available for sale, at market value
|
$
|
76,170
|
$
|
100,697
|
||||
(amortized cost: 2018, $76,274; 2017, $100,703)
|
||||||||
Other invested assets (cost: 2018, $91; 2017, $102,559)
|
91
|
102,559
|
||||||
Cash
|
198
|
3,275
|
||||||
Investment in subsidiaries, at equity in the underlying net assets
|
7,776,940
|
8,356,791
|
||||||
Accrued investment income
|
277
|
394
|
||||||
Receivable from subsidiaries
|
6,726
|
7,361
|
||||||
Other assets
|
44,737
|
49,829
|
||||||
TOTAL ASSETS
|
$
|
7,905,139
|
$
|
8,620,906
|
||||
LIABILITIES:
|
||||||||
Long term note payable - Affiliated
|
$
|
-
|
$
|
250,000
|
||||
Due to subsidiaries
|
1,065
|
1,017
|
||||||
Other liabilities
|
270
|
657
|
||||||
Total liabilities
|
1,335
|
251,674
|
||||||
SHAREHOLDERS' EQUITY:
|
||||||||
Preferred shares, par value: $0.01; 50,000 shares authorized;
|
||||||||
no shares issued and outstanding
|
-
|
-
|
||||||
Common shares, par value: $0.01; 200,000 shares authorized;
|
||||||||
(2018) 69,202 and (2017) 69,044 issued outstanding before treasury
shares
|
692
|
691
|
||||||
Additional paid-in capital
|
2,188,777
|
2,165,768
|
||||||
Accumulated other comprehensive income (loss), net of deferred income
|
||||||||
tax expense (benefit) of ($20,697) at 2018 and $9,356 at 2017
|
(462,557
|
)
|
(160,891
|
)
|
||||
Treasury shares, at cost; 28,551 shares (2018) and 28,208 shares (2017)
|
(3,397,548
|
)
|
(3,322,244
|
)
|
||||
Retained earnings
|
9,574,440
|
9,685,908
|
||||||
Total shareholders' equity
|
7,903,804
|
8,369,232
|
||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
$
|
7,905,139
|
$
|
8,620,906
|
||||
See notes to consolidated financial statements.
|
SCHEDULE II — CONDENSED FINANCIAL INFORMATION OF THE REGISTRANT
|
||||||||||||
CONDENSED STATEMENTS OF OPERATIONS
|
||||||||||||
Years Ended December 31,
|
||||||||||||
2018
|
2017
|
2016
|
||||||||||
(Dollars in thousands)
|
||||||||||||
REVENUES:
|
||||||||||||
Net investment income
|
$
|
3,790
|
$
|
1,344
|
$
|
879
|
||||||
Net realized capital gains (losses)
|
(57
|
)
|
80
|
144
|
||||||||
Other income (expense)
|
(5,298
|
)
|
(6,873
|
)
|
5,022
|
|||||||
Net income (loss) of subsidiaries
|
127,369
|
495,496
|
1,012,315
|
|||||||||
Total revenues
|
125,804
|
490,048
|
1,018,360
|
|||||||||
EXPENSES:
|
||||||||||||
Interest expense - affiliated
|
4,085
|
4,300
|
4,300
|
|||||||||
Other expenses
|
18,167
|
16,780
|
17,716
|
|||||||||
Total expenses
|
22,252
|
21,080
|
22,016
|
|||||||||
INCOME (LOSS) BEFORE TAXES
|
103,552
|
468,968
|
996,344
|
|||||||||
Income tax expense (benefit)
|
-
|
-
|
-
|
|||||||||
NET INCOME (LOSS)
|
$
|
103,552
|
$
|
468,968
|
$
|
996,344
|
||||||
Other comprehensive income (loss), net of tax:
|
||||||||||||
Unrealized appreciation (depreciation) ("URA(D)") on securities
arising during the period
|
(255,656
|
)
|
(64,348
|
)
|
57,629
|
|||||||
Reclassification adjustment for realized losses (gains) included
in net income (loss)
|
27,496
|
(6,950
|
)
|
15,118
|
||||||||
Total URA(D) on securities arising during the period
|
(228,160
|
)
|
(71,298
|
)
|
72,747
|
|||||||
Foreign currency translation adjustments
|
(76,816
|
)
|
121,917
|
(55,341
|
)
|
|||||||
Benefit plan actuarial net gain (loss) for the period
|
(510
|
)
|
1,027
|
(7,488
|
)
|
|||||||
Reclassification adjustment for amortization of net (gain) loss
included in net income (loss)
|
5,021
|
5,477
|
5,073
|
|||||||||
Total benefit plan net gain (loss) for the period
|
4,511
|
6,504
|
(2,415
|
)
|
||||||||
Total other comprehensive income (loss), net of tax
|
(300,465
|
)
|
57,123
|
14,991
|
||||||||
COMPREHENSIVE INCOME (LOSS)
|
$
|
(196,913
|
)
|
$
|
526,091
|
$
|
1,011,335
|
|||||
See notes to consolidated financial statements.
|
SCHEDULE II — CONDENSED FINANCIAL INFORMATION OF THE REGISTRANT
|
||||||||||||
CONDENSED STATEMENTS OF CASH FLOWS
|
||||||||||||
Years Ended December 31,
|
||||||||||||
(Dollars in thousands)
|
2018
|
2017
|
2016
|
|||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||||||
Net income (loss)
|
$
|
103,552
|
$
|
468,968
|
$
|
996,344
|
||||||
Adjustments to reconcile net income to net cash provided by
operating activities:
|
||||||||||||
Equity in retained (earnings) deficit of subsidiaries
|
(127,369
|
)
|
(495,496
|
)
|
(1,012,315
|
)
|
||||||
Dividends received from Bermuda Re
|
750,000
|
400,000
|
650,000
|
|||||||||
Dividends received from Everest International
|
200,000
|
-
|
40,000
|
|||||||||
Dividends received from Mt. Logan Re
|
-
|
25,000
|
-
|
|||||||||
Change in other assets and liabilities, net
|
4,823
|
6,107
|
66
|
|||||||||
Increase (decrease) in due to/from affiliates
|
683
|
(6,470
|
)
|
(206
|
)
|
|||||||
Amortization of bond premium (accrual of bond discount)
|
(577
|
)
|
12
|
(56
|
)
|
|||||||
Realized capital losses (gains)
|
57
|
(80
|
)
|
(144
|
)
|
|||||||
Non-cash compensation expense
|
2,740
|
3,448
|
2,311
|
|||||||||
Net cash provided by (used in) operating activities
|
933,909
|
401,489
|
676,000
|
|||||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||||||
Additional investment in subsidiaries
|
(542,965
|
)
|
(109,815
|
)
|
(77,324
|
)
|
||||||
Proceeds from fixed maturities matured/called - available for sale, at market value
|
93
|
696
|
1,152
|
|||||||||
Proceeds from fixed maturities sold - available for sale, at market value
|
24,856
|
90,154
|
75,025
|
|||||||||
Distribution from other invested assets
|
1,026,297
|
546,414
|
757,399
|
|||||||||
Cost of fixed maturities acquired - available for sale, at market value
|
-
|
(189,308
|
)
|
-
|
||||||||
Cost of other invested assets acquired
|
(923,828
|
)
|
(503,937
|
)
|
(902,435
|
)
|
||||||
Net change in short-term investments
|
-
|
-
|
18,288
|
|||||||||
Net cash provided by (used in) investing activities
|
(415,547
|
)
|
(165,796
|
)
|
(127,895
|
)
|
||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||||||
Common shares issued during the period, net
|
20,086
|
22,790
|
34,861
|
|||||||||
Purchase of treasury shares
|
(75,304
|
)
|
(50,000
|
)
|
(386,288
|
)
|
||||||
Dividends paid to shareholders
|
(216,221
|
)
|
(207,242
|
)
|
(195,384
|
)
|
||||||
Cost of repayment of long term note - affiliated |
(250,000 |
) |
- |
- |
||||||||
Net cash provided by (used in) financing activities
|
(521,439
|
)
|
(234,452
|
)
|
(546,811
|
)
|
||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH
|
-
|
-
|
-
|
|||||||||
Net increase (decrease) in cash
|
(3,077
|
)
|
1,241
|
1,294
|
||||||||
Cash, beginning of period
|
3,275
|
2,034
|
740
|
|||||||||
Cash, end of period
|
$
|
198
|
$
|
3,275
|
$
|
2,034
|
||||||
See notes to consolidated financial statements.
|
1.)
|
The accompanying condensed financial information should be read in conjunction with the
consolidated financial statements and related Notes of Everest Re Group, Ltd. and its Subsidiaries.
|
2.)
|
Everest Re Group, Ltd. entered into a $250,000 thousand long term promissory note agreement
with Everest Reinsurance Holdings, Inc., an affiliated company, as of December 31, 2014. The note was scheduled to mature on December 31, 2023 but was repaid in December 2018. As of December
31, 2017, this transaction was presented as a Long Term Note Payable – Affiliated in the Condensed Balance Sheets of Everest Re Group, Ltd.
|
3.)
|
Everest Re Group, Ltd. has invested funds in the segregated accounts of Mt. Logan Re, Ltd.
(“Mt. Logan Re”), an affiliated entity. On the Condensed Balance Sheets, investments in Mt. Logan Re valued at $45,625 thousand and $50,373 thousand as of December 31, 2018 and 2017,
respectively, have been recorded within Other Assets. On the Condensed Statements of Operations, expense of $4,695 thousand, expense of $6,352 thousand and income of $5,536 thousand for the
years ended December 31, 2018, 2017 and 2016, respectively, have been recorded in other income (expense).
|
SCHEDULE III — SUPPLEMENTARY INSURANCE INFORMATION
|
||||||||||||||||||||||||||||||||||||
Column A
|
Column B
|
Column C
|
Column D
|
Column E
|
Column F
|
Column G
|
Column H
|
Column I
|
Column J
|
|||||||||||||||||||||||||||
Reserve
|
Incurred
|
|||||||||||||||||||||||||||||||||||
Geographic Area
|
for Losses
|
Loss and
|
Amortization
|
|||||||||||||||||||||||||||||||||
Deferred
|
and Loss
|
Unearned
|
Net
|
Loss
|
of Deferred
|
Other
|
Net
|
|||||||||||||||||||||||||||||
Acquisition
|
Adjustment
|
Premium
|
Premiums
|
Investment
|
Adjustment
|
Acquisition
|
Operating
|
Written
|
||||||||||||||||||||||||||||
(Dollars in thousands)
|
Costs
|
Expenses
|
Reserves
|
Earned
|
Income
|
Expenses
|
Costs
|
Expenses
|
Premium
|
|||||||||||||||||||||||||||
December 31, 2018
|
||||||||||||||||||||||||||||||||||||
Domestic
|
$
|
334,818
|
$
|
8,154,003
|
$
|
1,695,208
|
$
|
4,167,619
|
$
|
287,002
|
$
|
3,849,982
|
$
|
835,823
|
$
|
288,933
|
$
|
4,350,157
|
||||||||||||||||||
International
|
54,253
|
2,209,202
|
261,611
|
1,439,882
|
34,965
|
992,704
|
364,010
|
39,042
|
1,458,745
|
|||||||||||||||||||||||||||
Bermuda
|
122,502
|
2,755,885
|
560,793
|
1,324,198
|
259,216
|
808,717
|
319,197
|
43,566
|
1,605,526
|
|||||||||||||||||||||||||||
Total
|
$
|
511,573
|
$
|
13,119,090
|
$
|
2,517,612
|
$
|
6,931,699
|
$
|
581,183
|
$
|
5,651,403
|
$
|
1,519,030
|
$
|
371,541
|
$
|
7,414,428
|
||||||||||||||||||
December 31, 2017
|
||||||||||||||||||||||||||||||||||||
Domestic
|
$
|
289,636
|
$
|
7,254,043
|
$
|
1,460,291
|
$
|
3,642,547
|
$
|
259,621
|
$
|
2,727,649
|
$
|
712,568
|
$
|
241,962
|
$
|
3,875,982
|
||||||||||||||||||
International
|
53,186
|
2,175,500
|
253,626
|
1,202,043
|
32,407
|
1,059,640
|
287,688
|
38,844
|
1,229,597
|
|||||||||||||||||||||||||||
Bermuda
|
68,765
|
2,454,778
|
286,639
|
1,093,250
|
250,870
|
735,292
|
303,707
|
38,011
|
1,139,082
|
|||||||||||||||||||||||||||
Total
|
$
|
411,587
|
$
|
11,884,321
|
$
|
2,000,556
|
$
|
5,937,840
|
$
|
542,898
|
$
|
4,522,581
|
$
|
1,303,963
|
$
|
318,817
|
$
|
6,244,661
|
||||||||||||||||||
December 31, 2016
|
||||||||||||||||||||||||||||||||||||
Domestic
|
$
|
220,864
|
$
|
6,604,867
|
$
|
1,110,528
|
$
|
3,363,381
|
$
|
234,123
|
$
|
2,191,170
|
$
|
671,256
|
$
|
230,879
|
$
|
3,356,262
|
||||||||||||||||||
International
|
52,014
|
1,748,380
|
237,120
|
1,119,121
|
33,059
|
486,550
|
283,447
|
35,512
|
1,082,712
|
|||||||||||||||||||||||||||
Bermuda
|
71,174
|
1,959,065
|
229,898
|
837,964
|
205,902
|
461,909
|
233,989
|
36,331
|
831,931
|
|||||||||||||||||||||||||||
Total
|
$
|
344,052
|
$
|
10,312,313
|
$
|
1,577,546
|
$
|
5,320,466
|
$
|
473,085
|
$
|
3,139,629
|
$
|
1,188,692
|
$
|
302,722
|
$
|
5,270,905
|
||||||||||||||||||
(Some amounts may not reconcile due to rounding.)
|
SCHEDULE IV — REINSURANCE
|
||||||||||||||||||||
Column A
|
Column B
|
Column C
|
Column D
|
Column E
|
Column F
|
|||||||||||||||
Ceded to
|
Assumed
|
|||||||||||||||||||
Gross
|
Other
|
from Other
|
Net
|
Assumed
|
||||||||||||||||
(Dollars in thousands)
|
Amount
|
Companies
|
Companies
|
Amount
|
to Net
|
|||||||||||||||
December 31, 2018
|
||||||||||||||||||||
Total property and liability insurance
|
||||||||||||||||||||
premiums earned
|
$
|
2,129,320
|
$
|
1,004,953
|
$
|
5,807,332
|
$
|
6,931,699
|
83.8
|
%
|
||||||||||
December 31, 2017
|
||||||||||||||||||||
Total property and liability insurance
|
||||||||||||||||||||
premiums earned
|
$
|
1,825,705
|
$
|
833,387
|
$
|
4,945,522
|
$
|
5,937,840
|
83.3
|
%
|
||||||||||
December 31, 2016
|
||||||||||||||||||||
Total property and liability insurance
|
||||||||||||||||||||
premiums earned
|
$
|
1,694,702
|
$
|
736,180
|
$
|
4,361,944
|
$
|
5,320,466
|
82.0
|
%
|