BERMUDA | 98-0501001 | |
(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) |
Large accelerated filer x | Accelerated filer o | |
Non-accelerated filer o | Smaller reporting company o | |
(Do not check if a smaller reporting company) |
Page | |
June 30, 2016 | December 31, 2015 | ||||||
(unaudited) | |||||||
Assets | |||||||
Fixed maturities trading, at fair value (amortized cost: 2016—$5,524,027; 2015—$5,556,900) | $ | 5,551,586 | $ | 5,510,331 | |||
Short-term investments trading, at fair value (amortized cost: 2016—$2,369,704; 2015—$1,941,615) | 2,369,654 | 1,941,635 | |||||
Other investments, at fair value (cost: 2016—$338,669; 2015—$315,963) | 359,526 | 336,856 | |||||
Cash and cash equivalents | 568,798 | 723,109 | |||||
Restricted cash | 96,022 | 73,270 | |||||
Total investments and cash | 8,945,586 | 8,585,201 | |||||
Investments in affiliates, equity method (cost: 2016—$86,101; 2015—$70,186) | 99,278 | 88,065 | |||||
Premiums receivable | 1,372,000 | 658,682 | |||||
Deferred acquisition costs | 283,213 | 181,002 | |||||
Prepaid reinsurance premiums | 145,567 | 77,992 | |||||
Securities lending collateral | 10,224 | 4,863 | |||||
Loss reserves recoverable | 442,987 | 350,586 | |||||
Paid losses recoverable | 27,648 | 23,071 | |||||
Income taxes recoverable | 8,526 | 16,228 | |||||
Deferred tax asset | 23,745 | 21,661 | |||||
Receivable for investments sold | 13,736 | 39,766 | |||||
Intangible assets | 118,426 | 121,258 | |||||
Goodwill | 196,758 | 196,758 | |||||
Accrued investment income | 24,925 | 23,897 | |||||
Other assets | 105,625 | 126,782 | |||||
Total assets | $ | 11,818,244 | $ | 10,515,812 | |||
Liabilities | |||||||
Reserve for losses and loss expenses | $ | 3,122,717 | $ | 2,996,567 | |||
Unearned premiums | 1,621,563 | 966,210 | |||||
Reinsurance balances payable | 92,488 | 75,380 | |||||
Securities lending payable | 10,690 | 5,329 | |||||
Deferred tax liability | 3,552 | 3,847 | |||||
Payable for investments purchased | 52,718 | 77,475 | |||||
Accounts payable and accrued expenses | 149,593 | 627,331 | |||||
Notes payable to AlphaCat investors | 370,982 | 75,493 | |||||
Senior notes payable | 245,261 | 245,161 | |||||
Debentures payable | 537,987 | 537,668 | |||||
Total liabilities | $ | 6,207,551 | $ | 5,610,461 | |||
Commitments and contingent liabilities | |||||||
Redeemable noncontrolling interest | 1,532,283 | 1,111,714 | |||||
Shareholders’ equity | |||||||
Preferred shares (Issued and Outstanding: 2016—6,000; 2015—nil) | $ | 150,000 | $ | — | |||
Common shares (Issued: 2016—161,252,871; 2015—160,570,772; Outstanding: 2016—80,772,238; 2015—82,900,617) | 28,219 | 28,100 | |||||
Treasury shares (2016—80,480,633; 2015—77,670,155) | (14,084 | ) | (13,592 | ) | |||
Additional paid-in capital | 883,701 | 1,002,980 | |||||
Accumulated other comprehensive loss | (18,182 | ) | (12,569 | ) | |||
Retained earnings | 2,836,602 | 2,634,056 | |||||
Total shareholders’ equity available to Validus | 3,866,256 | 3,638,975 | |||||
Noncontrolling interest | 212,154 | 154,662 | |||||
Total shareholders’ equity | $ | 4,078,410 | $ | 3,793,637 | |||
Total liabilities, noncontrolling interests and shareholders’ equity | $ | 11,818,244 | $ | 10,515,812 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||
Revenues | |||||||||||||||
Gross premiums written | $ | 764,042 | $ | 726,168 | $ | 1,936,833 | $ | 1,845,392 | |||||||
Reinsurance premiums ceded | (36,229 | ) | (55,418 | ) | (204,064 | ) | (246,743 | ) | |||||||
Net premiums written | 727,813 | 670,750 | 1,732,769 | 1,598,649 | |||||||||||
Change in unearned premiums | (154,090 | ) | (98,062 | ) | (587,778 | ) | (450,071 | ) | |||||||
Net premiums earned | 573,723 | 572,688 | 1,144,991 | 1,148,578 | |||||||||||
Net investment income | 39,257 | 33,611 | 68,718 | 64,640 | |||||||||||
Net realized gains on investments | 2,724 | 2,244 | 2,140 | 6,413 | |||||||||||
Change in net unrealized gains (losses) on investments | 31,428 | (34,676 | ) | 78,872 | (1,449 | ) | |||||||||
(Loss) income from investment affiliate | (589 | ) | 284 | (4,702 | ) | 3,060 | |||||||||
Other insurance related income and other income | 824 | 100 | 2,237 | 1,040 | |||||||||||
Foreign exchange gains (losses) | 6,286 | (2,671 | ) | 12,531 | (6,936 | ) | |||||||||
Total revenues | 653,653 | 571,580 | 1,304,787 | 1,215,346 | |||||||||||
Expenses | |||||||||||||||
Losses and loss expenses | 307,130 | 266,146 | 531,577 | 507,075 | |||||||||||
Policy acquisition costs | 107,966 | 104,323 | 215,159 | 202,734 | |||||||||||
General and administrative expenses | 89,688 | 84,025 | 175,896 | 168,260 | |||||||||||
Share compensation expenses | 10,727 | 9,242 | 21,964 | 18,296 | |||||||||||
Finance expenses | 14,166 | 18,682 | 29,369 | 39,649 | |||||||||||
Total expenses | 529,677 | 482,418 | 973,965 | 936,014 | |||||||||||
Income before taxes, income from operating affiliates and (income) attributable to AlphaCat investors | 123,976 | 89,162 | 330,822 | 279,332 | |||||||||||
Tax (expense) benefit | (1,706 | ) | (2,549 | ) | 412 | (5,114 | ) | ||||||||
Income (loss) from operating affiliates | — | 1,738 | (23 | ) | 5,722 | ||||||||||
(Income) attributable to AlphaCat investors | (6,114 | ) | — | (10,714 | ) | — | |||||||||
Net income | $ | 116,156 | $ | 88,351 | $ | 320,497 | $ | 279,940 | |||||||
Net (income) attributable to noncontrolling interest | (21,193 | ) | (22,561 | ) | (58,724 | ) | (40,739 | ) | |||||||
Net income available to Validus | 94,963 | 65,790 | 261,773 | 239,201 | |||||||||||
Dividends on preferred shares | — | — | — | — | |||||||||||
Net income available to Validus common shareholders | $ | 94,963 | $ | 65,790 | $ | 261,773 | $ | 239,201 | |||||||
Comprehensive income | |||||||||||||||
Net income | $ | 116,156 | $ | 88,351 | $ | 320,497 | $ | 279,940 | |||||||
Other comprehensive (loss) income | |||||||||||||||
Change in foreign currency translation adjustments | (3,287 | ) | 2,763 | (5,315 | ) | (256 | ) | ||||||||
Change in minimum pension liability, net of tax | 479 | 422 | 396 | 157 | |||||||||||
Change in fair value of cash flow hedge | 64 | 390 | (694 | ) | (411 | ) | |||||||||
Other comprehensive (loss) income | (2,744 | ) | 3,575 | (5,613 | ) | (510 | ) | ||||||||
Comprehensive (income) attributable to noncontrolling interest | (21,193 | ) | (22,561 | ) | (58,724 | ) | (40,739 | ) | |||||||
Comprehensive income available to Validus | $ | 92,219 | $ | 69,365 | $ | 256,160 | $ | 238,691 | |||||||
Earnings per share | |||||||||||||||
Weighted average number of common shares and common share equivalents outstanding | |||||||||||||||
Basic | 81,950,833 | 84,003,549 | 82,386,047 | 83,627,396 | |||||||||||
Diluted | 83,373,003 | 87,313,154 | 83,785,659 | 87,448,142 | |||||||||||
Basic earnings per share available to Validus common shareholders | $ | 1.16 | $ | 0.77 | $ | 3.18 | $ | 2.83 | |||||||
Earnings per diluted share available to Validus common shareholders | $ | 1.14 | $ | 0.75 | $ | 3.12 | $ | 2.74 | |||||||
Cash dividends declared per common share | $ | 0.35 | $ | 0.32 | $ | 0.70 | $ | 0.64 |
Six Months Ended June 30, | |||||||
2016 | 2015 | ||||||
(unaudited) | (unaudited) | ||||||
Preferred shares | |||||||
Balance - beginning of period | $ | — | $ | — | |||
Preferred shares issued | 150,000 | — | |||||
Balance - end of period | $ | 150,000 | $ | — | |||
Common shares | |||||||
Balance - beginning of period | $ | 28,100 | $ | 27,222 | |||
Common shares issued, net | 119 | 494 | |||||
Balance - end of period | $ | 28,219 | $ | 27,716 | |||
Treasury shares | |||||||
Balance - beginning of period | $ | (13,592 | ) | $ | (12,545 | ) | |
Repurchase of common shares | (492 | ) | (595 | ) | |||
Balance - end of period | $ | (14,084 | ) | $ | (13,140 | ) | |
Additional paid-in capital | |||||||
Balance - beginning of period | $ | 1,002,980 | $ | 1,207,493 | |||
Offering expenses on preferred shares | (5,148 | ) | — | ||||
Common shares issued, net | (7,504 | ) | 14,366 | ||||
Repurchase of common shares | (128,591 | ) | (142,628 | ) | |||
Share compensation expenses | 21,964 | 18,296 | |||||
Balance - end of period | $ | 883,701 | $ | 1,097,527 | |||
Accumulated other comprehensive loss | |||||||
Balance - beginning of period | $ | (12,569 | ) | $ | (8,556 | ) | |
Other comprehensive loss | (5,613 | ) | (510 | ) | |||
Balance - end of period | $ | (18,182 | ) | $ | (9,066 | ) | |
Retained earnings | |||||||
Balance - beginning of period | $ | 2,634,056 | $ | 2,372,972 | |||
Dividends on preferred shares | — | — | |||||
Dividends on common shares | (59,227 | ) | (57,874 | ) | |||
Net income | 320,497 | 279,940 | |||||
Net (income) attributable to noncontrolling interest | (58,724 | ) | (40,739 | ) | |||
Balance - end of period | $ | 2,836,602 | $ | 2,554,299 | |||
Total shareholders’ equity available to Validus | $ | 3,866,256 | $ | 3,657,336 | |||
Noncontrolling interest | $ | 212,154 | $ | 153,523 | |||
Total shareholders’ equity | $ | 4,078,410 | $ | 3,810,859 |
Six Months Ended June 30, | |||||||
2016 | 2015 | ||||||
(unaudited) | (unaudited) | ||||||
Cash flows provided by operating activities | |||||||
Net income | $ | 320,497 | $ | 279,940 | |||
Adjustments to reconcile net income to cash provided by operating activities: | |||||||
Share compensation expenses | 21,964 | 18,296 | |||||
Amortization of discount on senior notes | 54 | 54 | |||||
Loss (income) from investment affiliate | 4,702 | (3,060 | ) | ||||
Net realized gains on investments | (2,140 | ) | (6,413 | ) | |||
Change in net unrealized (gains) losses on investments | (78,872 | ) | 1,449 | ||||
Amortization of intangible assets | 2,832 | 2,832 | |||||
Loss (income) from operating affiliates | 23 | (5,722 | ) | ||||
Foreign exchange (gains) losses included in net income | (6,289 | ) | 7,729 | ||||
Amortization of premium on fixed maturity investments | 8,710 | 12,395 | |||||
Change in: | |||||||
Premiums receivable | (719,070 | ) | (566,100 | ) | |||
Deferred acquisition costs | (102,211 | ) | (92,020 | ) | |||
Prepaid reinsurance premiums | (67,575 | ) | (79,304 | ) | |||
Loss reserves recoverable | (95,429 | ) | 644 | ||||
Paid losses recoverable | (4,571 | ) | (2,253 | ) | |||
Income taxes recoverable | 7,423 | (13,931 | ) | ||||
Deferred tax asset | (2,529 | ) | 908 | ||||
Accrued investment income | (1,183 | ) | 984 | ||||
Other assets | (5,272 | ) | 90,625 | ||||
Reserve for losses and loss expenses | 147,305 | (50,240 | ) | ||||
Unearned premiums | 655,353 | 529,374 | |||||
Reinsurance balances payable | 18,610 | (34,472 | ) | ||||
Deferred tax liability | (308 | ) | 2,329 | ||||
Accounts payable and accrued expenses | (32,581 | ) | (61,570 | ) | |||
Net cash provided by operating activities | 69,443 | 32,474 | |||||
Cash flows used in investing activities | |||||||
Proceeds on sales of fixed maturity investments | 1,376,077 | 2,237,966 | |||||
Proceeds on maturities of fixed maturity investments | 184,413 | 186,594 | |||||
Purchases of fixed maturity investments | (1,537,608 | ) | (2,337,990 | ) | |||
Purchases of short-term investments, net | (428,040 | ) | (154,804 | ) | |||
(Purchases) sales of other investments, net | (19,796 | ) | 4,101 | ||||
Increase in securities lending collateral | (5,361 | ) | (6,551 | ) | |||
Redemption from operating affiliates | 369 | — | |||||
Investment in investment affiliates, net | (16,305 | ) | (23,115 | ) | |||
(Increase) decrease in restricted cash | (22,752 | ) | 32,984 | ||||
Net cash used in investing activities | (469,003 | ) | (60,815 | ) | |||
Cash flows provided by (used in) financing activities | |||||||
Net proceeds on issuance of notes payable to AlphaCat investors | 294,748 | — | |||||
Net proceeds on issuance of preferred shares | 144,852 | — | |||||
Issuance of common shares, net | (7,385 | ) | 14,860 | ||||
Purchases of common shares under share repurchase program | (129,083 | ) | (143,223 | ) | |||
Dividends paid on preferred shares | — | — | |||||
Dividends paid on common shares | (59,961 | ) | (58,718 | ) | |||
Increase in securities lending payable | 5,361 | 6,551 | |||||
Third party investment in redeemable noncontrolling interest | 381,250 | 452,700 | |||||
Third party redemption of redeemable noncontrolling interest | (10,800 | ) | (80,433 | ) | |||
Third party investment in noncontrolling interest | 171,674 | 9,600 | |||||
Third party distributions of noncontrolling interest | (127,103 | ) | (158,175 | ) | |||
Third party subscriptions deployed on AlphaCat Funds and Sidecars | (411,336 | ) | (117,400 | ) | |||
Net cash provided by (used in) financing activities | 252,217 | (74,238 | ) | ||||
Effect of foreign currency rate changes on cash and cash equivalents | (6,968 | ) | (8,730 | ) | |||
Net decrease in cash and cash equivalents | (154,311 | ) | (111,309 | ) | |||
Cash and cash equivalents - beginning of period | 723,109 | 550,401 | |||||
Cash and cash equivalents - end of period | $ | 568,798 | $ | 439,092 | |||
Taxes paid during the period | $ | 3,837 | $ | 14,192 | |||
Interest paid during the period | $ | 27,552 | $ | 27,248 |
Three Months Ended June 30, 2015 | |||||||||||
As previously reported | Adjustment for adoption of new consolidation guidance | Revised | |||||||||
Total revenues | $ | 591,492 | $ | (19,912 | ) | $ | 571,580 | ||||
Total expenses | 480,511 | 1,907 | 482,418 | ||||||||
Net income | 81,657 | 6,694 | 88,351 | ||||||||
Net (income) attributable to noncontrolling interest | (17,644 | ) | (4,917 | ) | (22,561 | ) | |||||
Net income available to Validus | 64,013 | 1,777 | 65,790 | ||||||||
Comprehensive income available to Validus | 67,588 | 1,777 | 69,365 | ||||||||
Basic earnings per share available to common shareholders | $ | 0.75 | $ | 0.02 | $ | 0.77 | |||||
Earnings per diluted share available to common shareholders | $ | 0.73 | $ | 0.02 | $ | 0.75 |
Six Months Ended June 30, 2015 | |||||||||||
As previously reported | Adjustment for adoption of new consolidation guidance | Revised | |||||||||
Total revenues | $ | 1,280,697 | $ | (65,351 | ) | $ | 1,215,346 | ||||
Total expenses | 934,010 | 2,004 | 936,014 | ||||||||
Net income | 294,045 | (14,105 | ) | 279,940 | |||||||
Net (income) attributable to noncontrolling interest | (56,621 | ) | 15,882 | (40,739 | ) | ||||||
Net income available to Validus | 237,424 | 1,777 | 239,201 | ||||||||
Comprehensive income available to Validus | 236,914 | 1,777 | 238,691 | ||||||||
Basic earnings per share available to common shareholders | $ | 2.81 | $ | 0.02 | $ | 2.83 | |||||
Earnings per diluted share available to common shareholders | $ | 2.72 | $ | 0.02 | $ | 2.74 |
Six Months Ended June 30, 2015 | |||||||||||
As previously reported | Adjustment for adoption of new consolidation guidance | Revised | |||||||||
Net cash (used in) provided by operating activities | $ | (228,841 | ) | $ | 261,315 | $ | 32,474 | ||||
Net cash used in investing activities | (290,517 | ) | 229,702 | (60,815 | ) | ||||||
Net cash provided by (used in) financing activities | 389,593 | (463,831 | ) | (74,238 | ) | ||||||
Effect of foreign currency rate changes on cash and cash equivalents | (13,765 | ) | 5,035 | (8,730 | ) | ||||||
Net decrease in cash | (143,530 | ) | 32,221 | (111,309 | ) | ||||||
Cash and cash equivalents - beginning of period | 577,240 | (26,839 | ) | 550,401 | |||||||
Cash and cash equivalents - end of period | 433,710 | 5,382 | 439,092 |
Amortized Cost (or Cost) | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
Managed investments | |||||||||||||||
U.S. government and government agency | $ | 924,350 | $ | 7,536 | $ | (83 | ) | $ | 931,803 | ||||||
Non-U.S. government and government agency | 217,796 | 2,146 | (4,692 | ) | 215,250 | ||||||||||
U.S. states, municipalities, political subdivisions | 278,756 | 7,049 | (393 | ) | 285,412 | ||||||||||
Agency residential mortgage-backed securities | 662,468 | 14,713 | (398 | ) | 676,783 | ||||||||||
Non-agency residential mortgage-backed securities | 23,858 | 271 | (740 | ) | 23,389 | ||||||||||
U.S. corporate | 1,539,711 | 20,350 | (4,014 | ) | 1,556,047 | ||||||||||
Non-U.S. corporate | 367,473 | 3,264 | (6,331 | ) | 364,406 | ||||||||||
Bank loans | 613,414 | 574 | (16,926 | ) | 597,062 | ||||||||||
Asset-backed securities | 429,890 | 2,352 | (2,902 | ) | 429,340 | ||||||||||
Commercial mortgage-backed securities | 308,712 | 6,048 | (727 | ) | 314,033 | ||||||||||
Total fixed maturities | 5,366,428 | 64,303 | (37,206 | ) | 5,393,525 | ||||||||||
Short-term investments | 189,678 | — | (50 | ) | 189,628 | ||||||||||
Other investments | |||||||||||||||
Fund of hedge funds | 1,457 | — | (498 | ) | 959 | ||||||||||
Hedge funds | 12,463 | 6,162 | — | 18,625 | |||||||||||
Private equity investments | 62,119 | 14,457 | (3,270 | ) | 73,306 | ||||||||||
Investment funds | 203,128 | 743 | — | 203,871 | |||||||||||
Overseas deposits | 55,301 | — | — | 55,301 | |||||||||||
Mutual funds | 4,201 | 3,263 | — | 7,464 | |||||||||||
Total other investments | 338,669 | 24,625 | (3,768 | ) | 359,526 | ||||||||||
Total managed investments | $ | 5,894,775 | $ | 88,928 | $ | (41,024 | ) | $ | 5,942,679 | ||||||
Non-managed investments | |||||||||||||||
Catastrophe bonds | $ | 157,599 | $ | 2,114 | $ | (1,652 | ) | $ | 158,061 | ||||||
Short-term investments | 2,180,026 | — | — | 2,180,026 | |||||||||||
Total non-managed investments | 2,337,625 | 2,114 | (1,652 | ) | 2,338,087 | ||||||||||
Total investments | $ | 8,232,400 | $ | 91,042 | $ | (42,676 | ) | $ | 8,280,766 |
Amortized Cost (or Cost) | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
Managed investments | |||||||||||||||
U.S. government and government agency | $ | 940,428 | $ | 333 | $ | (3,559 | ) | $ | 937,202 | ||||||
Non-U.S. government and government agency | 241,549 | 257 | (3,838 | ) | 237,968 | ||||||||||
U.S. states, municipalities, political subdivisions | 299,929 | 2,322 | (962 | ) | 301,289 | ||||||||||
Agency residential mortgage-backed securities | 606,676 | 6,361 | (2,455 | ) | 610,582 | ||||||||||
Non-agency residential mortgage-backed securities | 27,025 | 310 | (415 | ) | 26,920 | ||||||||||
U.S. corporate | 1,503,614 | 1,594 | (15,257 | ) | 1,489,951 | ||||||||||
Non-U.S. corporate | 453,178 | 797 | (7,405 | ) | 446,570 | ||||||||||
Bank loans | 592,981 | 275 | (17,045 | ) | 576,211 | ||||||||||
Asset-backed securities | 440,363 | 344 | (3,583 | ) | 437,124 | ||||||||||
Commercial mortgage-backed securities | 263,310 | 131 | (3,306 | ) | 260,135 | ||||||||||
Total fixed maturities | 5,369,053 | 12,724 | (57,825 | ) | 5,323,952 | ||||||||||
Short-term investments | 237,349 | 20 | — | 237,369 | |||||||||||
Other investments | |||||||||||||||
Fund of hedge funds | 1,457 | — | (40 | ) | 1,417 | ||||||||||
Hedge funds | 14,018 | 6,962 | — | 20,980 | |||||||||||
Private equity investments | 53,489 | 12,751 | (2,469 | ) | 63,771 | ||||||||||
Investment funds | 188,121 | 600 | — | 188,721 | |||||||||||
Overseas deposits | 54,484 | — | — | 54,484 | |||||||||||
Mutual funds | 4,394 | 3,089 | — | 7,483 | |||||||||||
Total other investments | 315,963 | 23,402 | (2,509 | ) | 336,856 | ||||||||||
Total managed investments | $ | 5,922,365 | $ | 36,146 | $ | (60,334 | ) | $ | 5,898,177 | ||||||
Non-managed investments | |||||||||||||||
Catastrophe bonds | $ | 187,847 | $ | 635 | $ | (2,103 | ) | $ | 186,379 | ||||||
Short-term investments | 1,704,266 | — | — | 1,704,266 | |||||||||||
Total non-managed investments | 1,892,113 | 635 | (2,103 | ) | 1,890,645 | ||||||||||
Total investments | $ | 7,814,478 | $ | 36,781 | $ | (62,437 | ) | $ | 7,788,822 |
(a) | Fixed maturity investments |
June 30, 2016 | December 31, 2015 | ||||||||||||
Fair Value | % of Total | Fair Value | % of Total | ||||||||||
Managed fixed maturities | |||||||||||||
AAA | $ | 2,446,839 | 44.1 | % | $ | 2,367,642 | 43.0 | % | |||||
AA | 508,086 | 9.2 | % | 569,386 | 10.3 | % | |||||||
A | 1,045,965 | 18.8 | % | 1,031,326 | 18.7 | % | |||||||
BBB | 741,800 | 13.4 | % | 691,538 | 12.6 | % | |||||||
Total investment grade managed fixed maturities | 4,742,690 | 85.5 | % | 4,659,892 | 84.6 | % | |||||||
BB | 227,436 | 4.0 | % | 235,724 | 4.3 | % | |||||||
B | 183,127 | 3.3 | % | 179,069 | 3.2 | % | |||||||
CCC | 8,331 | 0.2 | % | 5,706 | 0.1 | % | |||||||
CC | 113 | 0.0 | % | 1,015 | 0.0 | % | |||||||
NR | 231,828 | 4.2 | % | 242,546 | 4.4 | % | |||||||
Total non-investment grade managed fixed maturities | 650,835 | 11.7 | % | 664,060 | 12.0 | % | |||||||
Total managed fixed maturities | $ | 5,393,525 | 97.2 | % | $ | 5,323,952 | 96.6 | % | |||||
Non-managed catastrophe bonds | |||||||||||||
BBB | $ | — | 0.0 | % | $ | 1,911 | 0.0 | % | |||||
Total investment grade non-managed catastrophe bonds | — | 0.0 | % | 1,911 | 0.0 | % | |||||||
BB | 41,412 | 0.7 | % | 70,962 | 1.3 | % | |||||||
B | 6,161 | 0.1 | % | 30,698 | 0.6 | % | |||||||
NR | 110,488 | 2.0 | % | 82,808 | 1.5 | % | |||||||
Total non-investment grade non-managed catastrophe bonds | 158,061 | 2.8 | % | 184,468 | 3.4 | % | |||||||
Total non-managed fixed maturities | 158,061 | 2.8 | % | 186,379 | 3.4 | % | |||||||
Total fixed maturities | $ | 5,551,586 | 100.0 | % | $ | 5,510,331 | 100.0 | % |
June 30, 2016 | December 31, 2015 | ||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | ||||||||||||
Managed investments | |||||||||||||||
Due in one year or less | $ | 349,115 | $ | 348,137 | $ | 367,132 | $ | 366,019 | |||||||
Due after one year through five years | 2,990,421 | 2,996,295 | 2,965,920 | 2,936,053 | |||||||||||
Due after five years through ten years | 485,899 | 492,101 | 548,183 | 539,083 | |||||||||||
Due after ten years | 116,065 | 113,447 | 150,444 | 148,036 | |||||||||||
3,941,500 | 3,949,980 | 4,031,679 | 3,989,191 | ||||||||||||
Asset-backed and mortgage-backed securities | 1,424,928 | 1,443,545 | 1,337,374 | 1,334,761 | |||||||||||
Total managed fixed maturities | $ | 5,366,428 | $ | 5,393,525 | $ | 5,369,053 | $ | 5,323,952 | |||||||
Non-managed catastrophe bonds | |||||||||||||||
Due in one year or less | $ | 28,445 | $ | 29,328 | $ | 7,504 | $ | 7,544 | |||||||
Due after one year through five years | 128,614 | 128,185 | 165,093 | 163,575 | |||||||||||
Due after five years through ten years | 540 | 548 | 15,250 | 15,260 | |||||||||||
Due after ten years | — | — | — | — | |||||||||||
Total non-managed fixed maturities | 157,599 | 158,061 | 187,847 | 186,379 | |||||||||||
Total fixed maturities | $ | 5,524,027 | $ | 5,551,586 | $ | 5,556,900 | $ | 5,510,331 |
(b) | Other investments |
Other investments | Fair Value as at June 30, 2016 | Investments with redemption restrictions | Investments without redemption restrictions | Redemption frequency (a) | Redemption notice period (a) | |||||||||||
Fund of hedge funds | $ | 959 | $ | 959 | $ | — | ||||||||||
Hedge funds | 18,625 | 18,625 | — | |||||||||||||
Private equity investments | 73,306 | 73,306 | — | |||||||||||||
Investment funds | 203,871 | 181,536 | 22,335 | Daily | 2 days | |||||||||||
Overseas deposits | 55,301 | 55,301 | — | |||||||||||||
Mutual funds | 7,464 | — | 7,464 | Daily | Daily | |||||||||||
Total other investments | $ | 359,526 | $ | 329,727 | $ | 29,799 |
(a) | The redemption frequency and notice periods only apply to investments without redemption restrictions. |
Other investments | Fair value as at December 31, 2015 | Investments with redemption restrictions | Investments without redemption restrictions | Redemption frequency (a) | Redemption notice period (a) | |||||||||||
Fund of hedge funds | $ | 1,417 | $ | 1,417 | $ | — | ||||||||||
Hedge funds | 20,980 | 20,980 | — | |||||||||||||
Private equity investments | 63,771 | 63,771 | — | |||||||||||||
Investment funds | 188,721 | 167,910 | 20,811 | Daily | 2 days | |||||||||||
Overseas deposits | 54,484 | 54,484 | — | |||||||||||||
Mutual funds | 7,483 | — | 7,483 | Daily | Daily | |||||||||||
Total other investments | $ | 336,856 | $ | 308,562 | $ | 28,294 |
(a) | The redemption frequency and notice periods only apply to investments without redemption restrictions. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Managed investments | |||||||||||||||
Fixed maturities and short-term investments | $ | 30,621 | $ | 29,433 | $ | 58,638 | $ | 57,106 | |||||||
Other investments | 8,026 | 4,014 | 8,898 | 7,202 | |||||||||||
Restricted cash, cash and cash equivalents | 380 | 427 | 1,245 | 843 | |||||||||||
Securities lending income | 12 | 6 | 17 | 9 | |||||||||||
Total gross investment income | 39,039 | 33,880 | 68,798 | 65,160 | |||||||||||
Investment expenses | (2,190 | ) | (2,026 | ) | (4,026 | ) | (3,870 | ) | |||||||
Total managed net investment income | $ | 36,849 | $ | 31,854 | $ | 64,772 | $ | 61,290 | |||||||
Non managed investments | |||||||||||||||
Fixed maturities and short-term investments | $ | 1,977 | $ | 1,733 | $ | 3,272 | $ | 3,307 | |||||||
Restricted cash, cash and cash equivalents | 431 | 24 | 674 | 43 | |||||||||||
Total non-managed net investment income | 2,408 | 1,757 | 3,946 | 3,350 | |||||||||||
Total net investment income | $ | 39,257 | $ | 33,611 | $ | 68,718 | $ | 64,640 |
(d) | Net realized gains and change in net unrealized gains (losses) on investments |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Managed fixed maturities, short-term and other investments | |||||||||||||||
Gross realized gains | $ | 3,306 | $ | 6,140 | $ | 6,523 | $ | 12,449 | |||||||
Gross realized (losses) | (786 | ) | (4,036 | ) | (5,089 | ) | (6,165 | ) | |||||||
Net realized gains on investments | 2,520 | 2,104 | 1,434 | 6,284 | |||||||||||
Change in net unrealized gains (losses) on investments | 30,052 | (33,926 | ) | 77,130 | 743 | ||||||||||
Total net realized and change in net unrealized gains (losses) on managed investments | $ | 32,572 | $ | (31,822 | ) | $ | 78,564 | $ | 7,027 | ||||||
Non-managed fixed maturities, short-term and other investments | |||||||||||||||
Gross realized gains | $ | 204 | $ | 140 | $ | 715 | $ | 140 | |||||||
Gross realized (losses) | — | — | (9 | ) | (11 | ) | |||||||||
Net realized gains on investments | 204 | 140 | 706 | 129 | |||||||||||
Change in net unrealized (losses) on investments | 1,376 | (750 | ) | 1,742 | (2,192 | ) | |||||||||
Total net realized and change in net unrealized (losses) on non-managed investments | 1,580 | (610 | ) | 2,448 | (2,063 | ) | |||||||||
Total net realized and change in net unrealized gains (losses) on total investments | $ | 34,152 | $ | (32,432 | ) | $ | 81,012 | $ | 4,964 |
(e) | Pledged investments |
June 30, 2016 | ||||||||||||
Description | Commitment | Issued and Outstanding | Investments and cash pledged as collateral | |||||||||
$85,000 syndicated unsecured letter of credit facility | $ | 85,000 | $ | — | $ | — | ||||||
$300,000 syndicated secured letter of credit facility | 300,000 | 105,575 | 151,166 | |||||||||
$24,000 secured bi-lateral letter of credit facility | 24,000 | 11,805 | 48,380 | |||||||||
AlphaCat Re secured letter of credit facility | 20,000 | 20,000 | 30,191 | |||||||||
IPC bi-lateral facility | 25,000 | 5,666 | — | |||||||||
$236,000 Flagstone bi-lateral facility | 236,000 | 195,622 | 322,520 | |||||||||
Total | $ | 690,000 | $ | 338,668 | $ | 552,257 |
December 31, 2015 | ||||||||||||
Description | Commitment | Issued and Outstanding | Investments and cash pledged as collateral | |||||||||
$85,000 syndicated unsecured letter of credit facility | $ | 85,000 | $ | — | $ | — | ||||||
$300,000 syndicated secured letter of credit facility | 300,000 | 235,540 | 370,909 | |||||||||
$24,000 secured bi-lateral letter of credit facility | 24,000 | 10,543 | 47,607 | |||||||||
AlphaCat Re secured letter of credit facility | 30,000 | 30,000 | 30,153 | |||||||||
IPC bi-lateral facility | 25,000 | 9,241 | — | |||||||||
$236,000 Flagstone bi-lateral facility | 236,000 | 193,764 | 377,866 | |||||||||
Total | $ | 700,000 | $ | 479,088 | $ | 826,535 |
(a) | Classification within the fair value hierarchy |
Level 1 | Level 2 | Level 3 | Fair value based on NAV practical expedient | Total | |||||||||||||||
Managed investments | |||||||||||||||||||
U.S. government and government agency | $ | — | $ | 931,803 | $ | — | $ | — | $ | 931,803 | |||||||||
Non-U.S. government and government agency | — | 215,250 | — | — | 215,250 | ||||||||||||||
U.S. states, municipalities and political subdivisions | — | 285,412 | — | — | 285,412 | ||||||||||||||
Agency residential mortgage-backed securities | — | 676,783 | — | — | 676,783 | ||||||||||||||
Non-agency residential mortgage-backed securities | — | 23,389 | — | — | 23,389 | ||||||||||||||
U.S. corporate | — | 1,556,047 | — | — | 1,556,047 | ||||||||||||||
Non-U.S. corporate | — | 364,406 | — | — | 364,406 | ||||||||||||||
Bank loans | — | 353,914 | 243,148 | — | 597,062 | ||||||||||||||
Asset-backed securities | — | 416,957 | 12,383 | — | 429,340 | ||||||||||||||
Commercial mortgage-backed securities | — | 314,033 | — | — | 314,033 | ||||||||||||||
Total fixed maturities | — | 5,137,994 | 255,531 | — | 5,393,525 | ||||||||||||||
Short-term investments | 186,276 | 3,352 | — | — | 189,628 | ||||||||||||||
Other investments | |||||||||||||||||||
Fund of hedge funds | — | — | — | 959 | 959 | ||||||||||||||
Hedge funds | — | — | — | 18,625 | 18,625 | ||||||||||||||
Private equity investments | — | — | — | 73,306 | 73,306 | ||||||||||||||
Investment funds | — | 22,335 | — | 181,536 | 203,871 | ||||||||||||||
Overseas deposits | — | — | — | 55,301 | 55,301 | ||||||||||||||
Mutual funds | — | 7,464 | — | — | 7,464 | ||||||||||||||
Total other investments | — | 29,799 | — | 329,727 | 359,526 | ||||||||||||||
Total managed investments | $ | 186,276 | $ | 5,171,145 | $ | 255,531 | $ | 329,727 | $ | 5,942,679 | |||||||||
Non-managed investments | |||||||||||||||||||
Catastrophe bonds | $ | — | $ | 120,543 | $ | 37,518 | $ | — | $ | 158,061 | |||||||||
Short-term investments | 2,180,026 | — | — | — | 2,180,026 | ||||||||||||||
Total non-managed investments | 2,180,026 | 120,543 | 37,518 | — | 2,338,087 | ||||||||||||||
Total investments | $ | 2,366,302 | $ | 5,291,688 | $ | 293,049 | $ | 329,727 | $ | 8,280,766 |
Level 1 | Level 2 | Level 3 | Fair value based on NAV practical expedient | Total | |||||||||||||||
Managed investments | |||||||||||||||||||
U.S. government and government agency | $ | — | $ | 937,202 | $ | — | $ | — | $ | 937,202 | |||||||||
Non-U.S. government and government agency | — | 237,968 | — | — | 237,968 | ||||||||||||||
U.S. states, municipalities and political subdivisions | — | 301,289 | — | — | 301,289 | ||||||||||||||
Agency residential mortgage-backed securities | — | 610,582 | — | — | 610,582 | ||||||||||||||
Non-agency residential mortgage-backed securities | — | 26,920 | — | — | 26,920 | ||||||||||||||
U.S. corporate | — | 1,489,951 | — | — | 1,489,951 | ||||||||||||||
Non-U.S. corporate | — | 446,570 | — | — | 446,570 | ||||||||||||||
Bank loans | — | 343,874 | 232,337 | — | 576,211 | ||||||||||||||
Asset-backed securities | — | 437,124 | — | — | 437,124 | ||||||||||||||
Commercial mortgage-backed securities | — | 260,135 | — | — | 260,135 | ||||||||||||||
Total fixed maturities | — | 5,091,615 | 232,337 | — | 5,323,952 | ||||||||||||||
Short-term investments | 222,678 | 14,691 | — | — | 237,369 | ||||||||||||||
Other investments | |||||||||||||||||||
Fund of hedge funds | — | — | — | 1,417 | 1,417 | ||||||||||||||
Hedge funds | — | — | — | 20,980 | 20,980 | ||||||||||||||
Private equity investments | — | — | — | 63,771 | 63,771 | ||||||||||||||
Investment funds | — | 20,811 | — | 167,910 | 188,721 | ||||||||||||||
Overseas deposits | — | — | — | 54,484 | 54,484 | ||||||||||||||
Mutual funds | — | 7,483 | — | — | 7,483 | ||||||||||||||
Total other investments | — | 28,294 | — | 308,562 | 336,856 | ||||||||||||||
Total managed investments | $ | 222,678 | $ | 5,134,600 | $ | 232,337 | $ | 308,562 | $ | 5,898,177 | |||||||||
Non-managed investments | |||||||||||||||||||
Catastrophe bonds | $ | — | $ | 172,879 | $ | 13,500 | $ | — | $ | 186,379 | |||||||||
Short-term investments | 1,704,266 | — | — | — | 1,704,266 | ||||||||||||||
Total non-managed investments | 1,704,266 | 172,879 | 13,500 | — | 1,890,645 | ||||||||||||||
Total investments | $ | 1,926,944 | $ | 5,307,479 | $ | 245,837 | $ | 308,562 | $ | 7,788,822 |
(b) | Valuation techniques |
(c) | Level 3 investments |
Three Months Ended June 30, 2016 | |||||||||||||||
Bank Loans | Catastrophe Bonds | Asset Backed Securities | Total | ||||||||||||
Level 3 investments—beginning of period | $ | 255,011 | $ | 37,105 | $ | — | $ | 292,116 | |||||||
Purchases | 8,885 | — | 12,383 | 21,268 | |||||||||||
Settlements | (17,784 | ) | — | — | (17,784 | ) | |||||||||
Change in net unrealized (losses) gains | (2,964 | ) | 413 | — | (2,551 | ) | |||||||||
Transfers into Level 3 during the period | — | — | — | — | |||||||||||
Transfers out of Level 3 during the period | — | — | — | — | |||||||||||
Level 3 investments—end of period | $ | 243,148 | $ | 37,518 | $ | 12,383 | $ | 293,049 |
Three Months Ended June 30, 2015 | |||||||||||
Bank Loans | Catastrophe Bonds | Total | |||||||||
Level 3 investments—beginning of period | $ | 86,533 | $ | 15,500 | $ | 102,033 | |||||
Purchases | 43,791 | — | 43,791 | ||||||||
Sales | (929 | ) | (2,000 | ) | (2,929 | ) | |||||
Settlements | (4,203 | ) | — | (4,203 | ) | ||||||
Change in net unrealized losses | (210 | ) | — | (210 | ) | ||||||
Transfers into Level 3 during the period | — | — | — | ||||||||
Transfers out of Level 3 during the period | — | — | — | ||||||||
Level 3 investments—end of period | $ | 124,982 | $ | 13,500 | $ | 138,482 |
Six Months Ended June 30, 2016 | |||||||||||||||
Bank Loans | Catastrophe Bonds | Asset Backed Securities | Total | ||||||||||||
Level 3 investments—beginning of period | $ | 232,337 | $ | 13,500 | $ | — | $ | 245,837 | |||||||
Purchases | 50,988 | 23,272 | 12,383 | 86,643 | |||||||||||
Sales | (2,389 | ) | — | — | (2,389 | ) | |||||||||
Settlements | (34,033 | ) | (125 | ) | — | (34,158 | ) | ||||||||
Change in net unrealized (losses) gains | (3,755 | ) | 871 | — | (2,884 | ) | |||||||||
Transfers into Level 3 during the period | — | — | — | — | |||||||||||
Transfers out of Level 3 during the period | — | — | — | — | |||||||||||
Level 3 investments—end of period | $ | 243,148 | $ | 37,518 | $ | 12,383 | $ | 293,049 |
Six Months Ended June 30, 2015 | |||||||||||
Bank Loans | Catastrophe Bonds | Total | |||||||||
Level 3 investments—beginning of period | $ | 32,748 | $ | 17,500 | $ | 50,248 | |||||
Purchases | 101,966 | — | 101,966 | ||||||||
Sales | (929 | ) | (3,989 | ) | (4,918 | ) | |||||
Settlements | (8,198 | ) | — | (8,198 | ) | ||||||
Net realized losses | — | (11 | ) | (11 | ) | ||||||
Change in net unrealized losses | (605 | ) | — | (605 | ) | ||||||
Transfers into Level 3 during the period | — | — | — | ||||||||
Transfers out of Level 3 during the period | — | — | — | ||||||||
Level 3 investments—end of period | $ | 124,982 | $ | 13,500 | $ | 138,482 |
(a) | Consolidated VIEs |
Three Months Ended June 30, 2016 | |||||||||||
Variable Funding Notes | Structured Notes | Total | |||||||||
Notes payable to AlphaCat investors, beginning of period | $ | 261,793 | $ | 61,717 | $ | 323,510 | |||||
Issuance of notes payable to AlphaCat investors | 102,817 | 32,609 | 135,426 | ||||||||
Redemption of notes payable to AlphaCat investors | (88,079 | ) | — | (88,079 | ) | ||||||
Foreign exchange losses | 125 | — | 125 | ||||||||
Notes payable to AlphaCat investors, end of period | $ | 276,656 | $ | 94,326 | $ | 370,982 |
Six Months Ended June 30, 2016 | |||||||||||
Variable Funding Notes | Structured Notes | Total | |||||||||
Notes payable to AlphaCat investors, beginning of period | $ | 75,493 | $ | — | $ | 75,493 | |||||
Issuance of notes payable to AlphaCat investors | 298,105 | 94,326 | 392,431 | ||||||||
Redemption of notes payable to AlphaCat investors | (97,684 | ) | — | (97,684 | ) | ||||||
Foreign exchange losses | 742 | — | 742 | ||||||||
Notes payable to AlphaCat investors, end of period | $ | 276,656 | $ | 94,326 | $ | 370,982 |
June 30, 2016 | December 31, 2015 | ||||||||||||||
Total Assets | Total Liabilities | Total Assets | Total Liabilities | ||||||||||||
AlphaCat sidecars | $ | 47,693 | $ | 10,468 | $ | 206,581 | $ | 14,804 | |||||||
AlphaCat ILS funds - Lower Risk (a) | 1,544,346 | 129,842 | 1,268,070 | 143,371 | |||||||||||
AlphaCat ILS funds - Higher Risk (a) | 701,348 | 147,466 | 522,867 | 300,122 | |||||||||||
AlphaCat Re and AlphaCat Master Fund | 2,431,907 | 2,431,737 | 1,615,779 | 1,615,609 | |||||||||||
BetaCat ILS funds | 63,947 | 493 | 64,221 | 2,472 |
(a) | Lower risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of less than 7%, whereas higher risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of greater than 7%. Expected loss represents the average annual loss over the set of simulation scenarios divided by the total limit. |
(b) | Non-Consolidated VIEs |
June 30, 2016 | December 31, 2015 | ||||||
Investment affiliate | $ | 99,278 | $ | 87,673 | |||
Operating affiliate | — | 392 | |||||
Investments in affiliates | $ | 99,278 | $ | 88,065 |
(a) | Investment affiliate |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Investment affiliate, beginning of period | $ | 84,135 | $ | 85,982 | $ | 87,673 | $ | 63,506 | |||||||
Capital contributions | 15,732 | 3,415 | 16,307 | 23,115 | |||||||||||
(Loss) income from investment affiliate | (589 | ) | 284 | (4,702 | ) | 3,060 | |||||||||
Investment affiliate, end of period | $ | 99,278 | $ | 89,681 | $ | 99,278 | $ | 89,681 |
Investment at cost | Voting ownership % | Equity ownership % | Carrying value | ||||||||||
Aquiline Financial Services Fund II L.P. | $ | 56,479 | — | % | 8.0 | % | $ | 71,178 | |||||
Aquiline Financial Services Fund III L.P. | $ | 29,622 | — | % | 10.5 | % | $ | 28,100 | |||||
Total | $ | 86,101 | $ | 99,278 |
Investment at cost | Voting ownership % | Equity ownership % | Carrying value | ||||||||||
Aquiline Financial Services Fund II L.P. | $ | 55,904 | — | % | 8.1 | % | $ | 73,880 | |||||
Aquiline Financial Services Fund III L.P. | 13,890 | — | % | 13.7 | % | 13,793 | |||||||
Total | $ | 69,794 | $ | 87,673 |
(b) | Operating affiliate |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Operating affiliate, beginning of period | $ | 369 | $ | 54,928 | $ | 392 | $ | 50,944 | |||||||
Return of investment | (369 | ) | — | (369 | ) | — | |||||||||
(Loss) income from operating affiliate | — | 1,738 | (23 | ) | 5,722 | ||||||||||
Operating affiliate, end of period | $ | — | $ | 56,666 | $ | — | $ | 56,666 |
Investment at cost | Voting ownership % | Equity ownership % | Carrying value | ||||||||||
Investment in PaCRe | $ | — | 100.0 | % | 10.0 | % | $ | — |
Investment at cost | Voting ownership % | Equity ownership % | Carrying value | ||||||||||
Investment in PaCRe | $ | 392 | 100.0 | % | 10.0 | % | $ | 392 |
Three Months Ended June 30, 2016 | |||||||||||
Redeemable noncontrolling interest | Noncontrolling interest | Total | |||||||||
Balance, beginning of period | $ | 1,409,037 | $ | 157,223 | $ | 1,566,260 | |||||
Issuance of shares | 112,500 | 59,349 | 171,849 | ||||||||
Income attributable to noncontrolling interest | 17,230 | 3,963 | 21,193 | ||||||||
Redemptions payable | (6,484 | ) | — | (6,484 | ) | ||||||
Distributions | — | (8,381 | ) | (8,381 | ) | ||||||
Balance, end of period | $ | 1,532,283 | $ | 212,154 | $ | 1,744,437 |
Three Months Ended June 30, 2015 | |||||||||||
Redeemable noncontrolling interest | Noncontrolling interest | Total | |||||||||
Balance, beginning of period | $ | 834,644 | $ | 151,583 | $ | 986,227 | |||||
Issuance of shares | 249,300 | 9,600 | 258,900 | ||||||||
Income attributable to noncontrolling interest | 17,462 | 5,099 | 22,561 | ||||||||
Redemption of shares | (59,395 | ) | — | (59,395 | ) | ||||||
Redemptions payable | (6,500 | ) | — | (6,500 | ) | ||||||
Distributions | — | (12,759 | ) | (12,759 | ) | ||||||
Balance, end of period | $ | 1,035,511 | $ | 153,523 | $ | 1,189,034 |
Six Months Ended June 30, 2016 | |||||||||||
Redeemable noncontrolling interest | Noncontrolling interest | Total | |||||||||
Balance, beginning of period | $ | 1,111,714 | $ | 154,662 | $ | 1,266,376 | |||||
Issuance of shares | 381,250 | 171,674 | 552,924 | ||||||||
Income attributable to noncontrolling interest | 45,803 | 12,921 | 58,724 | ||||||||
Redemptions payable | (6,484 | ) | — | (6,484 | ) | ||||||
Distributions | — | (127,103 | ) | (127,103 | ) | ||||||
Balance, end of period | $ | 1,532,283 | $ | 212,154 | $ | 1,744,437 |
Six Months Ended June 30, 2015 | |||||||||||
Redeemable noncontrolling interest | Noncontrolling interest | Total | |||||||||
Balance, beginning of period | $ | 617,791 | $ | 292,274 | $ | 910,065 | |||||
Issuance of shares | 452,700 | 9,600 | 462,300 | ||||||||
Income attributable to noncontrolling interest | 30,915 | 9,824 | 40,739 | ||||||||
Redemption of shares | (59,395 | ) | — | (59,395 | ) | ||||||
Redemptions payable | (6,500 | ) | — | (6,500 | ) | ||||||
Distributions | — | (158,175 | ) | (158,175 | ) | ||||||
Balance, end of period | $ | 1,035,511 | $ | 153,523 | $ | 1,189,034 |
June 30, 2016 | December 31, 2015 | |||||||||||||||||||||||
Derivatives not designated as hedging instruments: | Notional Exposure | Asset Derivative at Fair Value (a) | Liability Derivative at Fair Value (a) | Notional Exposure | Asset Derivative at Fair Value (a) | Liability Derivative at Fair Value (a) | ||||||||||||||||||
Foreign currency forward contracts | $ | 297,275 | $ | 4,230 | $ | 4,746 | $ | 255,840 | $ | 2,601 | $ | 3,211 |
(a) | Asset and liability derivatives are classified within other assets and accounts payable and accrued expenses, respectively, on the Consolidated Balance Sheets. The net impact on earnings, recognized in income within foreign exchange gains (losses) relating to the foreign currency forward contracts that were not designated as hedging instruments during the three and six months ended June 30, 2016 was $896 and ($1,117), respectively (2015: $nil and $nil, respectively). The net impact on earnings, recognized in income within other income (loss) relating to the foreign currency forward contracts that were not designated as hedging instruments during the three and six months ended June 30, 2016 were $84 and $120, respectively (2015: ($128) and ($127), respectively). |
June 30, 2016 | December 31, 2015 | |||||||||||||||||||||||
Derivatives designated as hedging instruments: | Notional Exposure | Asset Derivative at Fair Value (a) | Liability Derivative at Fair Value (a) | Notional Exposure | Asset Derivative at Fair Value (a) | Liability Derivative at Fair Value (a) | ||||||||||||||||||
Interest rate swap contracts | $ | 552,263 | $ | 20 | $ | 2,529 | $ | 552,263 | $ | 21 | $ | 1,942 |
(a) | Asset and liability derivatives are classified within other assets and accounts payable and accrued expenses, respectively, on the Consolidated Balance Sheets. |
(a) | Classification within the fair value hierarchy |
(b) | Derivative instruments designated as a fair value hedge |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Foreign currency forward contracts | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Amount of loss recognized in income on derivative | $ | — | $ | (8,954 | ) | $ | — | $ | (15,156 | ) | ||||||
Amount of gain on hedged item recognized in income attributable to risk being hedged | $ | — | $ | 8,954 | $ | — | $ | 15,156 | ||||||||
Amount of gain recognized in income on derivative (ineffective portion) | $ | — | $ | — | $ | — | $ | — |
(c) | Derivative instruments designated as a cash flow hedge |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Interest rate swap contracts | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Amount of effective portion recognized in other comprehensive income | $ | 2,694 | $ | 2,846 | $ | 6,350 | $ | 6,886 | ||||||||
Amount of effective portion subsequently reclassified to earnings | $ | (2,758 | ) | $ | (3,236 | ) | $ | (5,656 | ) | $ | (6,475 | ) | ||||
Amount of ineffective portion excluded from effectiveness testing | $ | 64 | $ | 390 | $ | (694 | ) | $ | (411 | ) |
(d) | Balance sheet offsetting |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Reserve for losses and loss expenses, beginning of period | $ | 2,980,300 | $ | 3,207,885 | $ | 2,996,567 | $ | 3,243,147 | |||||||
Loss reserves recoverable | (370,689 | ) | (375,882 | ) | (350,586 | ) | (377,466 | ) | |||||||
Net reserves for losses and loss expenses, beginning of period | 2,609,611 | 2,832,003 | 2,645,981 | 2,865,681 | |||||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | |||||||||||||||
Current year | 369,911 | 336,864 | 648,097 | 661,352 | |||||||||||
Prior years (a) | (62,781 | ) | (70,718 | ) | (116,520 | ) | (154,277 | ) | |||||||
Total incurred losses and loss expenses (a) | 307,130 | 266,146 | 531,577 | 507,075 | |||||||||||
Less net losses and loss expenses paid in respect of losses occurring in: | |||||||||||||||
Current year | (45,882 | ) | (28,965 | ) | (61,655 | ) | (42,065 | ) | |||||||
Prior years | (176,775 | ) | (260,027 | ) | (430,079 | ) | (496,260 | ) | |||||||
Total net paid losses | (222,657 | ) | (288,992 | ) | (491,734 | ) | (538,325 | ) | |||||||
Foreign exchange (gain) loss | (14,354 | ) | 6,841 | (6,094 | ) | (18,433 | ) | ||||||||
Net reserve for losses and loss expenses, end of period | 2,679,730 | 2,815,998 | 2,679,730 | 2,815,998 | |||||||||||
Loss reserves recoverable | 442,987 | 376,665 | 442,987 | 376,665 | |||||||||||
Reserve for losses and loss expenses, end of period | $ | 3,122,717 | $ | 3,192,663 | $ | 3,122,717 | $ | 3,192,663 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Gross losses and loss expenses (a) | $ | 397,863 | $ | 303,771 | $ | 667,716 | $ | 568,567 | |||||||
Reinsurance recoverable | (90,733 | ) | (37,625 | ) | (136,139 | ) | (61,492 | ) | |||||||
Net incurred losses and loss expenses (a) | $ | 307,130 | $ | 266,146 | $ | 531,577 | $ | 507,075 |
(a) | Upon closing the acquisition of Western World, an adjustment of $15,586 was made to increase net reserves to reflect fair value. This adjustment was amortized to income through a reduction in losses and loss expenses of $2,892 and $6,115, respectively, during the three and six months ended June 30, 2015, benefiting the loss ratio by 4.4 and 4.6 percentage points, respectively. The remaining fair value adjustment of $4,864 was fully amortized during 2015. |
Three Months Ended June 30, 2016 | |||||||||||||||||||
Property | Marine | Specialty | Liability | Total | |||||||||||||||
Validus Re | $ | (9,468 | ) | $ | (10,018 | ) | $ | (11,391 | ) | $ | — | $ | (30,877 | ) | |||||
Talbot | (10,094 | ) | (8,928 | ) | (9,306 | ) | — | (28,328 | ) | ||||||||||
Western World | (1,582 | ) | — | — | (1,576 | ) | (3,158 | ) | |||||||||||
AlphaCat | (296 | ) | — | (122 | ) | — | (418 | ) | |||||||||||
Net favorable development | $ | (21,440 | ) | $ | (18,946 | ) | $ | (20,819 | ) | $ | (1,576 | ) | $ | (62,781 | ) |
Three Months Ended June 30, 2015 | |||||||||||||||||||
Property | Marine | Specialty | Liability | Total | |||||||||||||||
Validus Re | $ | (15,928 | ) | $ | (11,099 | ) | $ | (3,852 | ) | $ | — | $ | (30,879 | ) | |||||
Talbot | (16,683 | ) | (13,810 | ) | (5,093 | ) | — | (35,586 | ) | ||||||||||
Western World (a) | (866 | ) | — | — | (3,387 | ) | (4,253 | ) | |||||||||||
Net favorable development (a) | $ | (33,477 | ) | $ | (24,909 | ) | $ | (8,945 | ) | $ | (3,387 | ) | $ | (70,718 | ) |
(a) | Upon closing the acquisition of Western World, an adjustment of $15,586 was made to increase net reserves to reflect fair value. This adjustment was amortized to income through a reduction in losses and loss expenses of $2,892 during the three months ended June 30, 2015, benefiting the loss ratio by 4.4 percentage points. The remaining fair value adjustment of $4,864 was fully amortized during 2015. |
Six Months Ended June 30, 2016 | |||||||||||||||||||
Property | Marine | Specialty | Liability | Total | |||||||||||||||
Validus Re | $ | (32,300 | ) | $ | (6,463 | ) | $ | (17,798 | ) | $ | — | $ | (56,561 | ) | |||||
Talbot | (28,540 | ) | (5,964 | ) | (16,544 | ) | — | (51,048 | ) | ||||||||||
Western World | (2,023 | ) | — | — | (5,561 | ) | (7,584 | ) | |||||||||||
AlphaCat | (477 | ) | — | (850 | ) | — | (1,327 | ) | |||||||||||
Net favorable development | $ | (63,340 | ) | $ | (12,427 | ) | $ | (35,192 | ) | $ | (5,561 | ) | $ | (116,520 | ) |
Six Months Ended June 30, 2015 | |||||||||||||||||||
Property | Marine | Specialty | Liability | Total | |||||||||||||||
Validus Re | $ | (30,824 | ) | $ | (15,669 | ) | $ | (9,082 | ) | $ | — | $ | (55,575 | ) | |||||
Talbot | (37,435 | ) | (36,324 | ) | (13,514 | ) | — | (87,273 | ) | ||||||||||
Western World (a) | (3,594 | ) | — | — | (6,991 | ) | (10,585 | ) | |||||||||||
AlphaCat | (844 | ) | — | — | — | (844 | ) | ||||||||||||
Net favorable development (a) | $ | (72,697 | ) | $ | (51,993 | ) | $ | (22,596 | ) | $ | (6,991 | ) | $ | (154,277 | ) |
(a) | Upon closing the acquisition of Western World, an adjustment of $15,586 was made to increase net reserves to reflect fair value. This adjustment was amortized to income through a reduction in losses and loss expenses of $6,115 during the six months ended June 30, 2015, benefiting the loss ratio by 4.6 percentage points. The remaining fair value adjustment of $4,864 was fully amortized during 2015. |
June 30, 2016 | December 31, 2015 | ||||||||||||
Reinsurance Recoverable | % of Total | Reinsurance Recoverable | % of Total | ||||||||||
Top 10 reinsurers | $ | 391,076 | 83.1 | % | $ | 303,108 | 81.1 | % | |||||
Other reinsurers’ balances > $1 million | 70,763 | 15.0 | % | 61,222 | 16.4 | % | |||||||
Other reinsurers’ balances < $1 million | 8,796 | 1.9 | % | 9,327 | 2.5 | % | |||||||
Total | $ | 470,635 | 100.0 | % | $ | 373,657 | 100.0 | % |
June 30, 2016 | |||||||||
Top 10 Reinsurers | Rating | Reinsurance Recoverable | % of Total | ||||||
Fully collateralized reinsurers | NR | $ | 80,829 | 17.2 | % | ||||
Swiss Re | AA- | 80,604 | 17.1 | % | |||||
Lloyd's Syndicates | A+ | 79,508 | 16.9 | % | |||||
Hannover Re | AA- | 47,686 | 10.1 | % | |||||
Everest Re | A+ | 42,506 | 9.0 | % | |||||
Munich Re | AA- | 18,161 | 3.9 | % | |||||
Transatlantic Re | A+ | 11,719 | 2.5 | % | |||||
Hamilton Re | A- | 11,623 | 2.5 | % | |||||
National Indemnity Company | AA+ | 9,565 | 2.0 | % | |||||
Toa Re | A+ | 8,875 | 1.9 | % | |||||
Total | $ | 391,076 | 83.1 | % |
December 31, 2015 | |||||||||
Top 10 Reinsurers | Rating | Reinsurance Recoverable | % of Total | ||||||
Swiss Re | AA- | $ | 83,048 | 22.2 | % | ||||
Lloyd's Syndicates | A+ | 66,356 | 17.8 | % | |||||
Hannover Re | AA- | 43,765 | 11.7 | % | |||||
Everest Re | A+ | 43,060 | 11.5 | % | |||||
Munich Re | AA- | 18,707 | 5.0 | % | |||||
Transatlantic Re | A+ | 11,923 | 3.2 | % | |||||
Hamilton Re | A- | 10,898 | 2.9 | % | |||||
National Indemnity Company | AA+ | 10,293 | 2.8 | % | |||||
XL Re | A+ | 8,728 | 2.3 | % | |||||
Toa Re | A+ | 6,330 | 1.7 | % | |||||
Total | $ | 303,108 | 81.1 | % |
(a) | Preferred shares |
Preferred Shares | ||
Preferred shares issued and outstanding, December 31, 2015 | — | |
Preferred shares issued | 6,000 | |
Preferred shares issued and outstanding, June 30, 2016 | 6,000 |
(b) | Common Shares |
Common Shares | ||
Common shares issued, December 31, 2015 | 160,570,772 | |
Restricted share awards vested, net of shares withheld | 601,890 | |
Restricted share units vested, net of shares withheld | 18,486 | |
Options exercised | 13,635 | |
Performance share awards vested, net of shares withheld | 48,088 | |
Common shares issued, June 30, 2016 | 161,252,871 | |
Treasury shares, June 30, 2016 | (80,480,633 | ) |
Common shares outstanding, June 30, 2016 | 80,772,238 |
Common Shares | ||
Common shares issued, December 31, 2014 | 155,554,224 | |
Restricted share awards vested, net of shares withheld | 609,654 | |
Restricted share units vested, net of shares withheld | 13,260 | |
Options exercised | 728,489 | |
Warrants exercised | 1,461,715 | |
Direct issuance of common stock | 639 | |
Performance share awards vested, net of shares withheld | 11,524 | |
Common shares issued, June 30, 2015 | 158,379,505 | |
Treasury shares, June 30, 2015 | (75,083,710 | ) |
Common shares outstanding, June 30, 2015 | 83,295,795 |
(c) | Dividends |
(a) | Long Term Incentive Plan |
i. | Options |
Options | Weighted Average Grant Date Fair Value | Weighted Average Grant Date Exercise Price | ||||||||
Options outstanding, December 31, 2015 | 65,401 | $ | 7.74 | $ | 20.17 | |||||
Options exercised | (14,044 | ) | 7.69 | 17.02 | ||||||
Options outstanding, June 30, 2016 | 51,357 | $ | 7.75 | $ | 21.03 |
Options | Weighted Average Grant Date Fair Value | Weighted Average Grant Date Exercise Price | ||||||||
Options outstanding, December 31, 2014 | 1,160,057 | $ | 7.12 | $ | 17.74 | |||||
Options exercised | (1,040,680 | ) | 7.26 | 16.86 | ||||||
Options outstanding, June 30, 2015 | 119,377 | $ | 5.94 | $ | 25.46 |
ii. | Restricted share awards |
Restricted Share Awards | Weighted Average Grant Date Fair Value | |||||
Restricted share awards outstanding, December 31, 2015 | 2,739,446 | $ | 38.25 | |||
Restricted share awards granted | 534,905 | 48.69 | ||||
Restricted share awards vested | (783,523 | ) | 37.32 | |||
Restricted share awards forfeited | (8,317 | ) | 37.94 | |||
Restricted share awards outstanding, June 30, 2016 | 2,482,511 | $ | 40.79 |
Restricted Share Awards | Weighted Average Grant Date Fair Value | |||||
Restricted share awards outstanding, December 31, 2014 | 2,858,711 | $ | 35.81 | |||
Restricted share awards granted | 670,432 | 43.55 | ||||
Restricted share awards vested | (781,704 | ) | 34.42 | |||
Restricted share awards forfeited | (51,818 | ) | 38.04 | |||
Restricted share awards outstanding, June 30, 2015 | 2,695,621 | $ | 38.09 |
iii. | Restricted share units |
Restricted Share Units | Weighted Average Grant Date Fair Value | |||||
Restricted share units outstanding, December 31, 2015 | 114,337 | $ | 38.47 | |||
Restricted share units granted | 20,129 | 48.69 | ||||
Restricted share units vested | (23,982 | ) | 38.18 | |||
Restricted share units issued in lieu of cash dividends | 1,629 | 38.47 | ||||
Restricted share units outstanding, June 30, 2016 | 112,113 | $ | 40.37 |
Restricted Share Units | Weighted Average Grant Date Fair Value | |||||
Restricted share units outstanding, December 31, 2014 | 103,484 | $ | 36.54 | |||
Restricted share units granted | 28,057 | 42.91 | ||||
Restricted share units vested | (19,455 | ) | 34.58 | |||
Restricted share units issued in lieu of cash dividends | 1,517 | 36.53 | ||||
Restricted share units forfeited | (892 | ) | 35.42 | |||
Restricted share units outstanding, June 30, 2015 | 112,711 | $ | 38.47 |
iv. | Performance share awards |
Performance Share Awards | Weighted Average Grant Date Fair Value | |||||
Performance share awards outstanding, December 31, 2015 | 172,594 | $ | 40.70 | |||
Performance share awards granted | 121,844 | 48.69 | ||||
Performance share awards vested | (57,581 | ) | 36.11 | |||
Performance share awards conversion adjustment | 45,517 | 36.82 | ||||
Performance share awards outstanding, June 30, 2016 | 282,374 | $ | 44.46 |
Performance Share Awards | Weighted Average Grant Date Fair Value | |||||
Performance share awards outstanding, December 31, 2014 | 106,369 | $ | 36.03 | |||
Performance share awards granted | 81,569 | 45.03 | ||||
Performance share awards vested | (15,344 | ) | 31.38 | |||
Performance share awards outstanding, June 30, 2015 | 172,594 | $ | 40.70 |
(b) | Total share compensation expenses |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Restricted share awards | $ | 9,517 | $ | 8,653 | $ | 18,646 | $ | 17,132 | |||||||
Restricted share units | 377 | 279 | 688 | 541 | |||||||||||
Performance share awards | 833 | 310 | 2,630 | 623 | |||||||||||
Total | $ | 10,727 | $ | 9,242 | $ | 21,964 | $ | 18,296 |
(a) | Financing structure |
Commitment | Issued and outstanding (a) | Drawn | |||||||||
2006 Junior Subordinated Deferrable Debentures | $ | 150,000 | $ | 150,000 | $ | 150,000 | |||||
2007 Junior Subordinated Deferrable Debentures | 200,000 | 139,800 | 139,800 | ||||||||
Flagstone 2006 Junior Subordinated Deferrable Debentures | 134,437 | 134,437 | 134,437 | ||||||||
Flagstone 2007 Junior Subordinated Deferrable Debentures | 113,750 | 113,750 | 113,750 | ||||||||
Total debentures payable | 598,187 | 537,987 | 537,987 | ||||||||
2010 Senior Notes due 2040 | 250,000 | 250,000 | 245,261 | ||||||||
Total debentures and senior notes payable | 848,187 | 787,987 | 783,248 | ||||||||
$85,000 syndicated unsecured letter of credit facility | 85,000 | — | — | ||||||||
$300,000 syndicated secured letter of credit facility | 300,000 | 105,575 | — | ||||||||
$24,000 secured bi-lateral letter of credit facility | 24,000 | 11,805 | — | ||||||||
$20,000 AlphaCat Re secured letter of credit facility | 20,000 | 20,000 | — | ||||||||
$25,000 IPC bi-lateral facility | 25,000 | 5,666 | — | ||||||||
$236,000 Flagstone bi-lateral facility | 236,000 | 195,622 | — | ||||||||
Total credit and other facilities | 690,000 | 338,668 | — | ||||||||
Total debt and financing arrangements | $ | 1,538,187 | $ | 1,126,655 | $ | 783,248 |
Commitment | Issued and outstanding (a) | Drawn | |||||||||
2006 Junior Subordinated Deferrable Debentures | $ | 150,000 | $ | 150,000 | $ | 150,000 | |||||
2007 Junior Subordinated Deferrable Debentures | 200,000 | 139,800 | 139,800 | ||||||||
Flagstone 2006 Junior Subordinated Deferrable Debentures | 134,118 | 134,118 | 134,118 | ||||||||
Flagstone 2007 Junior Subordinated Deferrable Debentures | 113,750 | 113,750 | 113,750 | ||||||||
Total debentures payable | 597,868 | 537,668 | 537,668 | ||||||||
2010 Senior Notes due 2040 | 250,000 | 250,000 | 245,161 | ||||||||
Total debentures and senior notes payable | 847,868 | 787,668 | 782,829 | ||||||||
$85,000 syndicated unsecured letter of credit facility | 85,000 | — | — | ||||||||
$300,000 syndicated secured letter of credit facility | 300,000 | 235,540 | — | ||||||||
$24,000 secured bi-lateral letter of credit facility | 24,000 | 10,543 | — | ||||||||
$20,000 AlphaCat Re secured letter of credit facility | 30,000 | 30,000 | — | ||||||||
$25,000 IPC bi-lateral facility | 25,000 | 9,241 | — | ||||||||
$236,000 Flagstone bi-lateral facility | 236,000 | 193,764 | — | ||||||||
Total credit and other facilities | 700,000 | 479,088 | — | ||||||||
Total debt and financing arrangements | $ | 1,547,868 | $ | 1,266,756 | $ | 782,829 |
(a) | Indicates utilization of commitment amount, not necessarily drawn borrowings. |
(b) | Senior notes and junior subordinated deferrable debentures |
Description | Issuance date | Commitment | Maturity date | Interest Rate as at | Interest payments due | |||||||||||||
Issuance Date | June 30, 2016 | |||||||||||||||||
2006 Junior Subordinated Deferrable Debentures | June 15, 2006 | $ | 150,000 | June 15, 2036 | 9.069 | % | (a) | 5.831 | % | (e) | Quarterly | |||||||
Flagstone 2006 Junior Subordinated Deferrable Debentures | August 23, 2006 | $ | 134,437 | September 15, 2036 | 3.540 | % | (b) | 6.463 | % | (e) | Quarterly | |||||||
2007 Junior Subordinated Deferrable Debentures | June 21, 2007 | $ | 200,000 | June 15, 2037 | 8.480 | % | (c) | 5.180 | % | (e) | Quarterly | |||||||
Flagstone 2007 Junior Subordinated Deferrable Debentures | June 8, 2007 | $ | 88,750 | July 30, 2037 | 3.000 | % | (b) | 5.900 | % | (e) | Quarterly | |||||||
Flagstone 2007 Junior Subordinated Deferrable Debentures | September 20, 2007 | $ | 25,000 | September 15, 2037 | 3.100 | % | (b) | 5.983 | % | (e) | Quarterly | |||||||
2010 Senior Notes due 2040 | January 26, 2010 | $ | 250,000 | January 26, 2040 | 8.875 | % | (d) | 8.875 | % | (d) | Semi-annually in arrears |
(a) | Fixed interest rate for 5 years, floating interest rate of three-month LIBOR plus 3.550% thereafter, reset quarterly. |
(b) | Floating interest rate of three-month LIBOR plus amount stated, reset quarterly. |
(c) | Fixed interest rate for 5 years, floating interest rate of three-month LIBOR plus 2.950% thereafter, reset quarterly. |
(d) | Fixed interest rate. |
(e) | Fixed interest rate as a result of interest rate swap contracts entered into by the Company. |
(c) | Credit facilities |
i. | $85,000 syndicated unsecured letter of credit facility and $300,000 syndicated secured letter of credit facility |
ii. | $25,000 IPC bi-lateral facility |
iii. | $24,000 secured bi-lateral letter of credit facility |
v. | $236,000 Flagstone bi-lateral facility |
(d) | Finance expenses |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
2006 Junior Subordinated Deferrable Debentures | $ | 2,211 | $ | 2,211 | $ | 4,422 | $ | 4,398 | |||||||
2007 Junior Subordinated Deferrable Debentures | 1,830 | 1,835 | 3,661 | 3,644 | |||||||||||
Flagstone 2006 Junior Subordinated Deferrable Debentures | 2,244 | 2,243 | 4,489 | 4,461 | |||||||||||
Flagstone 2007 Junior Subordinated Deferrable Debentures | 1,766 | 1,770 | 3,533 | 3,528 | |||||||||||
2010 Senior Notes due 2040 | 5,597 | 5,597 | 11,194 | 11,194 | |||||||||||
Credit facilities | 235 | 1,193 | 896 | 2,900 | |||||||||||
Bank charges, Talbot FAL facility and other charges (a) | 206 | 1,252 | 213 | 2,459 | |||||||||||
AlphaCat fees (b) | 77 | 2,581 | 961 | 7,065 | |||||||||||
Total finance expenses | $ | 14,166 | $ | 18,682 | $ | 29,369 | $ | 39,649 |
(a) | On November 30, 2015, the Company terminated its Funds-at-Lloyd’s Standby Letter of Credit Facility (the “Talbot FAL Facility”) provided and arranged by Lloyds Bank plc and ING Bank N.V., London Branch. |
(b) | Includes finance expenses incurred by AlphaCat Managers Ltd. in relation to fund raising for the AlphaCat sidecars, the AlphaCat ILS funds and AlphaCat direct. |
Three Months Ended June 30, 2016 | Foreign currency translation adjustment | Minimum pension liability | Cash flow hedge | Total | |||||||||||
Balance beginning of period, net of tax | $ | (13,862 | ) | $ | 251 | $ | (1,827 | ) | $ | (15,438 | ) | ||||
Net current period other comprehensive loss, net of tax | (3,287 | ) | 479 | 64 | (2,744 | ) | |||||||||
Balance end of period, net of tax | $ | (17,149 | ) | $ | 730 | $ | (1,763 | ) | $ | (18,182 | ) |
Three Months Ended June 30, 2015 | Foreign currency translation adjustment | Minimum pension liability | Cash flow hedge | Total | |||||||||||
Balance beginning of period, net of tax | $ | (11,137 | ) | $ | (475 | ) | $ | (1,029 | ) | $ | (12,641 | ) | |||
Net current period other comprehensive loss, net of tax | 2,763 | 422 | 390 | 3,575 | |||||||||||
Balance end of period, net of tax | $ | (8,374 | ) | $ | (53 | ) | $ | (639 | ) | $ | (9,066 | ) |
Six Months Ended June 30, 2016 | Foreign currency translation adjustment | Minimum pension liability | Cash flow hedge | Total | |||||||||||
Balance beginning of period, net of tax | $ | (11,834 | ) | $ | 334 | $ | (1,069 | ) | $ | (12,569 | ) | ||||
Net current period other comprehensive loss, net of tax | (5,315 | ) | 396 | (694 | ) | (5,613 | ) | ||||||||
Balance end of period, net of tax | $ | (17,149 | ) | $ | 730 | $ | (1,763 | ) | $ | (18,182 | ) |
Six Months Ended June 30, 2015 | Foreign currency translation adjustment | Minimum pension liability | Cash flow hedge | Total | |||||||||||
Balance beginning of period, net of tax | $ | (8,118 | ) | $ | (210 | ) | $ | (228 | ) | $ | (8,556 | ) | |||
Net current period other comprehensive loss, net of tax | (256 | ) | 157 | (411 | ) | (510 | ) | ||||||||
Balance end of period, net of tax | $ | (8,374 | ) | $ | (53 | ) | $ | (639 | ) | $ | (9,066 | ) |
(a) | Funds at Lloyd's |
(b) | Lloyd's Central Fund |
(c) | Investment affiliate commitments |
(d) | AlphaCat commitments |
(e) | Fixed maturity commitments |
(f) | Other investment commitments |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Basic earnings per share | |||||||||||||||
Net income available to Validus common shareholders | 94,963 | 65,790 | 261,773 | 239,201 | |||||||||||
Less: Dividends on outstanding warrants | — | (1,081 | ) | — | (2,486 | ) | |||||||||
Net income allocated to Validus common shareholders | $ | 94,963 | $ | 64,709 | $ | 261,773 | $ | 236,715 | |||||||
Weighted average number of common shares outstanding | 81,950,833 | 84,003,549 | 82,386,047 | 83,627,396 | |||||||||||
Basic earnings per share available to Validus common shareholders | $ | 1.16 | $ | 0.77 | $ | 3.18 | $ | 2.83 | |||||||
Earnings per diluted share | |||||||||||||||
Net income available to Validus common shareholders | 94,963 | 65,790 | 261,773 | 239,201 | |||||||||||
Less: Dividends on outstanding warrants | — | — | — | — | |||||||||||
Net income allocated to Validus common shareholders | $ | 94,963 | $ | 65,790 | $ | 261,773 | $ | 239,201 | |||||||
Weighted average number of common shares outstanding | 81,950,833 | 84,003,549 | 82,386,047 | 83,627,396 | |||||||||||
Share equivalents: | |||||||||||||||
Warrants | — | 2,073,231 | — | 2,409,149 | |||||||||||
Stock options | 33,796 | 50,160 | 34,837 | 261,792 | |||||||||||
Unvested restricted shares | 1,388,374 | 1,186,214 | 1,364,775 | 1,149,805 | |||||||||||
Weighted average number of diluted common shares outstanding | 83,373,003 | 87,313,154 | 83,785,659 | 87,448,142 | |||||||||||
Earnings per diluted share available to Validus common shareholders | $ | 1.14 | $ | 0.75 | $ | 3.12 | $ | 2.74 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Validus Re Segment Information | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Underwriting revenues | ||||||||||||||||
Gross premiums written | $ | 285,810 | $ | 297,420 | $ | 977,478 | $ | 1,009,113 | ||||||||
Reinsurance premiums ceded | (3,196 | ) | (19,378 | ) | (95,691 | ) | (133,155 | ) | ||||||||
Net premiums written | 282,614 | 278,042 | 881,787 | 875,958 | ||||||||||||
Change in unearned premiums | (35,492 | ) | (13,492 | ) | (390,834 | ) | (358,320 | ) | ||||||||
Net premiums earned | 247,122 | 264,550 | 490,953 | 517,638 | ||||||||||||
Other insurance related income (loss) | 150 | 434 | (165 | ) | 749 | |||||||||||
Total underwriting revenues | 247,272 | 264,984 | 490,788 | 518,387 | ||||||||||||
Underwriting deductions | ||||||||||||||||
Losses and loss expenses | 132,139 | 123,405 | 215,007 | 236,533 | ||||||||||||
Policy acquisition costs | 42,564 | 43,826 | 84,823 | 85,920 | ||||||||||||
General and administrative expenses | 17,872 | 18,781 | 35,051 | 38,290 | ||||||||||||
Share compensation expenses | 2,775 | 2,396 | 5,676 | 4,974 | ||||||||||||
Total underwriting deductions | 195,350 | 188,408 | 340,557 | 365,717 | ||||||||||||
Underwriting income | $ | 51,922 | $ | 76,576 | $ | 150,231 | $ | 152,670 | ||||||||
Selected ratios: | ||||||||||||||||
Net premiums written / Gross premiums written | 98.9 | % | 93.5 | % | 90.2 | % | 86.8 | % | ||||||||
Losses and loss expenses | 53.5 | % | 46.6 | % | 43.8 | % | 45.7 | % | ||||||||
Policy acquisition costs | 17.2 | % | 16.6 | % | 17.3 | % | 16.6 | % | ||||||||
General and administrative expenses (a) | 8.4 | % | 8.0 | % | 8.3 | % | 8.4 | % | ||||||||
Expense ratio | 25.6 | % | 24.6 | % | 25.6 | % | 25.0 | % | ||||||||
Combined ratio | 79.1 | % | 71.2 | % | 69.4 | % | 70.7 | % |
(a) | The general and administrative expense ratio includes share compensation expenses. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Talbot Segment Information | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Underwriting revenues | ||||||||||||||||
Gross premiums written | $ | 296,067 | $ | 293,046 | $ | 562,384 | $ | 563,123 | ||||||||
Reinsurance premiums ceded | (27,161 | ) | (37,246 | ) | (114,619 | ) | (128,321 | ) | ||||||||
Net premiums written | 268,906 | 255,800 | 447,765 | 434,802 | ||||||||||||
Change in unearned premiums | (67,357 | ) | (50,362 | ) | (39,424 | ) | (6,775 | ) | ||||||||
Net premiums earned | 201,549 | 205,438 | 408,341 | 428,027 | ||||||||||||
Other insurance related income | 279 | 40 | 290 | 94 | ||||||||||||
Total underwriting revenues | 201,828 | 205,478 | 408,631 | 428,121 | ||||||||||||
Underwriting deductions | ||||||||||||||||
Losses and loss expenses | 109,310 | 95,970 | 209,411 | 174,098 | ||||||||||||
Policy acquisition costs | 43,613 | 47,659 | 87,956 | 96,763 | ||||||||||||
General and administrative expenses | 39,061 | 35,555 | 77,596 | 72,049 | ||||||||||||
Share compensation expenses | 3,270 | 3,024 | 6,792 | 5,981 | ||||||||||||
Total underwriting deductions | 195,254 | 182,208 | 381,755 | 348,891 | ||||||||||||
Underwriting income | $ | 6,574 | $ | 23,270 | $ | 26,876 | $ | 79,230 | ||||||||
Selected ratios: | ||||||||||||||||
Net premiums written / Gross premiums written | 90.8 | % | 87.3 | % | 79.6 | % | 77.2 | % | ||||||||
Losses and loss expenses | 54.2 | % | 46.7 | % | 51.3 | % | 40.7 | % | ||||||||
Policy acquisition costs | 21.6 | % | 23.2 | % | 21.5 | % | 22.6 | % | ||||||||
General and administrative expenses (a) | 21.1 | % | 18.8 | % | 20.7 | % | 18.2 | % | ||||||||
Expense ratio | 42.7 | % | 42.0 | % | 42.2 | % | 40.8 | % | ||||||||
Combined ratio | 96.9 | % | 88.7 | % | 93.5 | % | 81.5 | % |
(a) | The general and administrative expense ratio includes share compensation expenses. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Western World Segment Information | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Underwriting revenues | ||||||||||||||||
Gross premiums written | $ | 86,971 | $ | 79,554 | $ | 150,930 | $ | 136,501 | ||||||||
Reinsurance premiums ceded | (5,006 | ) | (5,441 | ) | (9,145 | ) | (8,674 | ) | ||||||||
Net premiums written | 81,965 | 74,113 | 141,785 | 127,827 | ||||||||||||
Change in unearned premiums | (16,309 | ) | (8,995 | ) | (14,630 | ) | 5,173 | |||||||||
Net premiums earned | 65,656 | 65,118 | 127,155 | 133,000 | ||||||||||||
Other insurance related income | 189 | 276 | 477 | 539 | ||||||||||||
Total underwriting revenues | 65,845 | 65,394 | 127,632 | 133,539 | ||||||||||||
Underwriting deductions | ||||||||||||||||
Losses and loss expenses | 44,229 | 46,771 | 83,875 | 97,288 | ||||||||||||
Policy acquisition costs | 15,410 | 9,617 | 29,610 | 13,896 | ||||||||||||
General and administrative expenses | 11,458 | 8,923 | 23,533 | 19,550 | ||||||||||||
Share compensation expenses | 542 | 494 | 1,123 | 971 | ||||||||||||
Total underwriting deductions | 71,639 | 65,805 | 138,141 | 131,705 | ||||||||||||
Underwriting (loss) income | $ | (5,794 | ) | $ | (411 | ) | $ | (10,509 | ) | $ | 1,834 | |||||
Selected ratios: | ||||||||||||||||
Net premiums written / Gross premiums written | 94.2 | % | 93.2 | % | 93.9 | % | 93.6 | % | ||||||||
Losses and loss expenses | 67.4 | % | 71.8 | % | 66.0 | % | 73.1 | % | ||||||||
Policy acquisition costs | 23.5 | % | 14.8 | % | 23.3 | % | 10.5 | % | ||||||||
General and administrative expenses (a) | 18.2 | % | 14.5 | % | 19.3 | % | 15.4 | % | ||||||||
Expense ratio | 41.7 | % | 29.3 | % | 42.6 | % | 25.9 | % | ||||||||
Combined ratio | 109.1 | % | 101.1 | % | 108.6 | % | 99.0 | % |
(a) | The general and administrative expense ratio includes share compensation expenses. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
AlphaCat Segment Information (a) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Revenues | ||||||||||||||||
Third party | $ | 3,091 | $ | 4,323 | $ | 7,818 | $ | 8,860 | ||||||||
Related party | 328 | 1,134 | 1,219 | 2,320 | ||||||||||||
Total revenues | 3,419 | 5,457 | 9,037 | 11,180 | ||||||||||||
Expenses | ||||||||||||||||
General and administrative expenses | 2,751 | 2,330 | 4,233 | 4,759 | ||||||||||||
Share compensation expenses | 133 | 150 | 274 | 299 | ||||||||||||
Finance expenses | 75 | 2,534 | 883 | 6,962 | ||||||||||||
Foreign exchange losses | 4 | 15 | 12 | 2 | ||||||||||||
Total expenses | 2,963 | 5,029 | 5,402 | 12,022 | ||||||||||||
Income (loss) before investments from AlphaCat Funds and Sidecars | 456 | 428 | 3,635 | (842 | ) | |||||||||||
Investment income (loss) from AlphaCat Funds and Sidecars (b) | ||||||||||||||||
AlphaCat Sidecars | 541 | 1,273 | 665 | 2,441 | ||||||||||||
AlphaCat ILS Funds - Lower Risk (c) | 2,075 | 1,894 | 4,582 | 3,180 | ||||||||||||
AlphaCat ILS Funds - Higher Risk (c) | 692 | 2,376 | 3,128 | 4,801 | ||||||||||||
BetaCat ILS Funds | 1,113 | 60 | 1,676 | 234 | ||||||||||||
PaCRe | — | 1,738 | (23 | ) | 5,722 | |||||||||||
Total investment income from AlphaCat Funds and Sidecars | 4,421 | 7,341 | 10,028 | 16,378 | ||||||||||||
Validus' share of AlphaCat income | $ | 4,877 | $ | 7,769 | $ | 13,663 | $ | 15,536 | ||||||||
Supplemental information: | ||||||||||||||||
Gross premiums written | ||||||||||||||||
AlphaCat Sidecars | $ | (14 | ) | $ | 3,241 | $ | (66 | ) | $ | 43,347 | ||||||
AlphaCat ILS Funds - Lower Risk (c) | 50,234 | 45,687 | 110,192 | 88,435 | ||||||||||||
AlphaCat ILS Funds - Higher Risk (c) | 42,010 | 13,867 | 138,330 | 32,818 | ||||||||||||
AlphaCat Direct (d) | 6,675 | — | 17,797 | — | ||||||||||||
Total gross premiums written | $ | 98,905 | $ | 62,795 | $ | 266,253 | $ | 164,600 |
(a) | The results of AlphaCat are presented on an asset manager basis, which is non-GAAP. A reconciliation of segmental income to net income available to Validus is included in the tables below. |
(b) | The investment income from the AlphaCat funds and sidecars is based on equity accounting. |
(c) | Lower risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of less than 7%, whereas higher risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of greater than 7%. Expected loss represents the average annual loss over the set of simulation scenarios divided by the total limit. |
(d) | AlphaCat Direct includes direct investments from third party investors in AlphaCat Re. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Corporate and Investment Information | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Investment income | ||||||||||||||||
Net investment income (a) | $ | 36,849 | $ | 31,854 | $ | 64,772 | $ | 61,290 | ||||||||
Operating expenses | ||||||||||||||||
General and administrative expenses | 17,872 | 17,092 | 34,055 | 32,698 | ||||||||||||
Share compensation expenses | 4,007 | 3,178 | 8,099 | 6,071 | ||||||||||||
Finance expenses (a) | 13,979 | 15,144 | 28,320 | 30,480 | ||||||||||||
Dividends on preferred shares | — | — | — | — | ||||||||||||
Tax expense (benefit) | 1,706 | 2,549 | (412 | ) | 5,114 | |||||||||||
Total operating expenses | 37,564 | 37,963 | 70,062 | 74,363 | ||||||||||||
Other items | ||||||||||||||||
Net realized gains on investments (a) | 2,520 | 2,104 | 1,434 | 6,284 | ||||||||||||
Change in net unrealized gains (losses) on investments (a) | 30,052 | (33,926 | ) | 77,130 | 743 | |||||||||||
(Loss) income from investment affiliate | (589 | ) | 284 | (4,702 | ) | 3,060 | ||||||||||
Foreign exchange gains (losses) (a) | 6,621 | (3,237 | ) | 12,695 | (6,693 | ) | ||||||||||
Other income (loss) | 79 | (608 | ) | 756 | (608 | ) | ||||||||||
Total other items | 38,683 | (35,383 | ) | 87,313 | 2,786 | |||||||||||
Total Corporate and Investment Information | $ | 37,968 | $ | (41,492 | ) | $ | 82,023 | $ | (10,287 | ) |
(a) | These items exclude the components which are included in Validus' share of AlphaCat and amounts which are consolidated from VIEs. |
Three Months Ended June 30, 2016 | |||||||||||||||||||||||||||
Validus Re Segment | Talbot Segment | Western World Segment | AlphaCat & Consolidated Variable Interest Entities | Corporate & Investments | Eliminations | Total | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||||||||
Gross premiums written | $ | 285,810 | $ | 296,067 | $ | 86,971 | $ | 98,905 | $ | (3,711 | ) | $ | 764,042 | ||||||||||||||
Reinsurance premiums ceded | (3,196 | ) | (27,161 | ) | (5,006 | ) | (4,577 | ) | 3,711 | (36,229 | ) | ||||||||||||||||
Net premiums written | 282,614 | 268,906 | 81,965 | 94,328 | — | 727,813 | |||||||||||||||||||||
Change in unearned premiums | (35,492 | ) | (67,357 | ) | (16,309 | ) | (34,932 | ) | — | (154,090 | ) | ||||||||||||||||
Net premiums earned | 247,122 | 201,549 | 65,656 | 59,396 | — | 573,723 | |||||||||||||||||||||
Other insurance related income (loss) | 150 | 279 | 189 | 3,401 | (3,274 | ) | 745 | ||||||||||||||||||||
Total underwriting revenues | 247,272 | 201,828 | 65,845 | 62,797 | (3,274 | ) | 574,468 | ||||||||||||||||||||
Underwriting deductions | |||||||||||||||||||||||||||
Losses and loss expenses | 132,139 | 109,310 | 44,229 | 21,452 | — | 307,130 | |||||||||||||||||||||
Policy acquisition costs | 42,564 | 43,613 | 15,410 | 6,530 | (151 | ) | 107,966 | ||||||||||||||||||||
General and administrative expenses | 17,872 | 39,061 | 11,458 | 6,561 | 17,872 | (3,136 | ) | 89,688 | |||||||||||||||||||
Share compensation expenses | 2,775 | 3,270 | 542 | 133 | 4,007 | — | 10,727 | ||||||||||||||||||||
Total underwriting deductions | 195,350 | 195,254 | 71,639 | 34,676 | 21,879 | (3,287 | ) | 515,511 | |||||||||||||||||||
Underwriting income (loss) | $ | 51,922 | $ | 6,574 | $ | (5,794 | ) | $ | 28,121 | $ | (21,879 | ) | $ | 13 | $ | 58,957 | |||||||||||
Other items (a) | 1,058 | 22,998 | 24,056 | ||||||||||||||||||||||||
Dividends on preferred shares | — | — | |||||||||||||||||||||||||
Net investment income | 3,005 | 36,849 | (597 | ) | 39,257 | ||||||||||||||||||||||
(Income) attributable to AlphaCat investors | (6,114 | ) | — | (6,114 | ) | ||||||||||||||||||||||
Net (income) attributable to noncontrolling interest | (21,193 | ) | — | (21,193 | ) | ||||||||||||||||||||||
Segmental income (loss) | $ | 51,922 | $ | 6,574 | $ | (5,794 | ) | $ | 4,877 | $ | 37,968 | $ | (584 | ) | |||||||||||||
Net income available to Validus common shareholders | $ | 94,963 |
(a) | Other items includes finance expenses, tax expenses, foreign exchange gains (losses), net realized and change in net unrealized gains (losses) on investments, income from investment and operating affiliates and other income (loss). |
Three Months Ended June 30, 2015 | |||||||||||||||||||||||||||
Validus Re Segment | Talbot Segment | Western World Segment | AlphaCat & Consolidated Variable Interest Entities | Corporate & Investments | Eliminations | Total | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||||||||
Gross premiums written | $ | 297,420 | $ | 293,046 | $ | 79,554 | $ | 62,795 | $ | (6,647 | ) | $ | 726,168 | ||||||||||||||
Reinsurance premiums ceded | (19,378 | ) | (37,246 | ) | (5,441 | ) | — | 6,647 | (55,418 | ) | |||||||||||||||||
Net premiums written | 278,042 | 255,800 | 74,113 | 62,795 | — | 670,750 | |||||||||||||||||||||
Change in unearned premiums | (13,492 | ) | (50,362 | ) | (8,995 | ) | (25,213 | ) | — | (98,062 | ) | ||||||||||||||||
Net premiums earned | 264,550 | 205,438 | 65,118 | 37,582 | — | 572,688 | |||||||||||||||||||||
Other insurance related income (loss) | 434 | 40 | 276 | 5,532 | (5,574 | ) | 708 | ||||||||||||||||||||
Total underwriting revenues | 264,984 | 205,478 | 65,394 | 43,114 | (5,574 | ) | 573,396 | ||||||||||||||||||||
Underwriting deductions | |||||||||||||||||||||||||||
Losses and loss expenses | 123,405 | 95,970 | 46,771 | — | — | 266,146 | |||||||||||||||||||||
Policy acquisition costs | 43,826 | 47,659 | 9,617 | 3,742 | (521 | ) | 104,323 | ||||||||||||||||||||
General and administrative expenses | 18,781 | 35,555 | 8,923 | 8,805 | 17,092 | (5,131 | ) | 84,025 | |||||||||||||||||||
Share compensation expenses | 2,396 | 3,024 | 494 | 150 | 3,178 | — | 9,242 | ||||||||||||||||||||
Total underwriting deductions | 188,408 | 182,208 | 65,805 | 12,697 | 20,270 | (5,652 | ) | 463,736 | |||||||||||||||||||
Underwriting income (loss) | $ | 76,576 | $ | 23,270 | $ | (411 | ) | $ | 30,417 | $ | (20,270 | ) | $ | 78 | $ | 109,660 | |||||||||||
Other items (a) | (1,844 | ) | (53,076 | ) | (54,920 | ) | |||||||||||||||||||||
Dividends on preferred shares | — | — | |||||||||||||||||||||||||
Net investment income | 1,757 | 31,854 | 33,611 | ||||||||||||||||||||||||
(Income) attributable to AlphaCat investors | — | — | — | ||||||||||||||||||||||||
Net (income) attributable to noncontrolling interest | (22,561 | ) | — | (22,561 | ) | ||||||||||||||||||||||
Segmental income (loss) | $ | 76,576 | $ | 23,270 | $ | (411 | ) | $ | 7,769 | $ | (41,492 | ) | $ | 78 | |||||||||||||
Net income available to Validus common shareholders | $ | 65,790 |
(a) | Other items includes finance expenses, tax expenses, foreign exchange gains (losses), net realized and change in net unrealized gains (losses) on investments, income from investment and operating affiliates and other income (loss). |
Six Months Ended June 30, 2016 | |||||||||||||||||||||||||||
Validus Re Segment | Talbot Segment | Western World Segment | AlphaCat & Consolidated Variable Interest Entities | Corporate & Investments | Eliminations | Total | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||||||||
Gross premiums written | $ | 977,478 | $ | 562,384 | $ | 150,930 | $ | 266,253 | $ | (20,212 | ) | $ | 1,936,833 | ||||||||||||||
Reinsurance premiums ceded | (95,691 | ) | (114,619 | ) | (9,145 | ) | (4,821 | ) | 20,212 | (204,064 | ) | ||||||||||||||||
Net premiums written | 881,787 | 447,765 | 141,785 | 261,432 | — | 1,732,769 | |||||||||||||||||||||
Change in unearned premiums | (390,834 | ) | (39,424 | ) | (14,630 | ) | (142,890 | ) | — | (587,778 | ) | ||||||||||||||||
Net premiums earned | 490,953 | 408,341 | 127,155 | 118,542 | — | 1,144,991 | |||||||||||||||||||||
Other insurance related (loss) income | (165 | ) | 290 | 477 | 9,066 | (8,187 | ) | 1,481 | |||||||||||||||||||
Total underwriting revenues | 490,788 | 408,631 | 127,632 | 127,608 | (8,187 | ) | 1,146,472 | ||||||||||||||||||||
Underwriting deductions | |||||||||||||||||||||||||||
Losses and loss expenses | 215,007 | 209,411 | 83,875 | 23,284 | — | 531,577 | |||||||||||||||||||||
Policy acquisition costs | 84,823 | 87,956 | 29,610 | 12,687 | 83 | 215,159 | |||||||||||||||||||||
General and administrative expenses | 35,051 | 77,596 | 23,533 | 14,017 | 34,055 | (8,356 | ) | 175,896 | |||||||||||||||||||
Share compensation expenses | 5,676 | 6,792 | 1,123 | 274 | 8,099 | — | 21,964 | ||||||||||||||||||||
Total underwriting deductions | 340,557 | 381,755 | 138,141 | 50,262 | 42,154 | (8,273 | ) | 944,596 | |||||||||||||||||||
Underwriting income (loss) | $ | 150,231 | $ | 26,876 | $ | (10,509 | ) | $ | 77,346 | $ | (42,154 | ) | $ | 86 | $ | 201,876 | |||||||||||
Other items (a) | 1,212 | 59,405 | 60,617 | ||||||||||||||||||||||||
Dividends on preferred shares | — | — | |||||||||||||||||||||||||
Net investment income | 4,543 | 64,772 | (597 | ) | 68,718 | ||||||||||||||||||||||
(Income) attributable to AlphaCat investors | (10,714 | ) | — | (10,714 | ) | ||||||||||||||||||||||
Net (income) attributable to noncontrolling interest | (58,724 | ) | — | (58,724 | ) | ||||||||||||||||||||||
Segmental income (loss) | $ | 150,231 | $ | 26,876 | $ | (10,509 | ) | $ | 13,663 | $ | 82,023 | $ | (511 | ) | |||||||||||||
Net income available to Validus common shareholders | $ | 261,773 |
(a) | Other items includes finance expenses, tax expenses, foreign exchange gains (losses), net realized and change in net unrealized gains (losses) on investments, income from investment and operating affiliates and other income (loss). |
Six Months Ended June 30, 2015 | |||||||||||||||||||||||||||
Validus Re Segment | Talbot Segment | Western World Segment | AlphaCat & Consolidated Variable Interest Entities | Corporate & Investments | Eliminations | Total | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||||||||
Gross premiums written | $ | 1,009,113 | $ | 563,123 | $ | 136,501 | $ | 164,600 | $ | (27,945 | ) | $ | 1,845,392 | ||||||||||||||
Reinsurance premiums ceded | (133,155 | ) | (128,321 | ) | (8,674 | ) | (4,538 | ) | 27,945 | (246,743 | ) | ||||||||||||||||
Net premiums written | 875,958 | 434,802 | 127,827 | 160,062 | — | 1,598,649 | |||||||||||||||||||||
Change in unearned premiums | (358,320 | ) | (6,775 | ) | 5,173 | (90,149 | ) | — | (450,071 | ) | |||||||||||||||||
Net premiums earned | 517,638 | 428,027 | 133,000 | 69,913 | — | 1,148,578 | |||||||||||||||||||||
Other insurance related income (loss) | 749 | 94 | 539 | 11,456 | (11,190 | ) | 1,648 | ||||||||||||||||||||
Total underwriting revenues | 518,387 | 428,121 | 133,539 | 81,369 | (11,190 | ) | 1,150,226 | ||||||||||||||||||||
Underwriting deductions | |||||||||||||||||||||||||||
Losses and loss expenses | 236,533 | 174,098 | 97,288 | (844 | ) | — | 507,075 | ||||||||||||||||||||
Policy acquisition costs | 85,920 | 96,763 | 13,896 | 7,177 | (1,022 | ) | 202,734 | ||||||||||||||||||||
General and administrative expenses | 38,290 | 72,049 | 19,550 | 16,059 | 32,698 | (10,386 | ) | 168,260 | |||||||||||||||||||
Share compensation expenses | 4,974 | 5,981 | 971 | 299 | 6,071 | — | 18,296 | ||||||||||||||||||||
Total underwriting deductions | 365,717 | 348,891 | 131,705 | 22,691 | 38,769 | (11,408 | ) | 896,365 | |||||||||||||||||||
Underwriting income (loss) | $ | 152,670 | $ | 79,230 | $ | 1,834 | $ | 58,678 | $ | (38,769 | ) | $ | 218 | $ | 253,861 | ||||||||||||
Other items (a) | (5,753 | ) | (32,808 | ) | (38,561 | ) | |||||||||||||||||||||
Dividends on preferred shares | — | — | |||||||||||||||||||||||||
Net investment income | 3,350 | 61,290 | 64,640 | ||||||||||||||||||||||||
(Income) attributable to AlphaCat investors | — | — | — | ||||||||||||||||||||||||
Net (income) attributable to noncontrolling interest | (40,739 | ) | — | (40,739 | ) | ||||||||||||||||||||||
Segmental income (loss) | $ | 152,670 | $ | 79,230 | $ | 1,834 | $ | 15,536 | $ | (10,287 | ) | $ | 218 | ||||||||||||||
Net income available to Validus | $ | 239,201 |
(a) | Other items includes finance expenses, tax expenses, foreign exchange gains (losses), net realized and change in net unrealized gains (losses) on investments, income from investment and operating affiliates and other income (loss). |
Gross Premiums Written | ||||||||||||||||||||||||||
Three Months Ended June 30, 2016 | ||||||||||||||||||||||||||
Validus Re | Talbot | Western World | AlphaCat | Eliminations | Total | % | ||||||||||||||||||||
United States | $ | 129,087 | $ | 39,135 | $ | 86,971 | $ | 37,338 | $ | (417 | ) | $ | 292,114 | 38.2 | % | |||||||||||
Worldwide excluding United States (a) | 16,975 | 30,028 | — | 6,496 | (136 | ) | 53,363 | 7.0 | % | |||||||||||||||||
Australia and New Zealand | 1,926 | 2,063 | — | 867 | 21 | 4,877 | 0.6 | % | ||||||||||||||||||
Europe | 3,267 | 6,855 | — | (145 | ) | 216 | 10,193 | 1.3 | % | |||||||||||||||||
Latin America and Caribbean | 5,992 | 27,597 | — | — | (2,511 | ) | 31,078 | 4.1 | % | |||||||||||||||||
Japan | 39,053 | 3,965 | — | 1,721 | (7 | ) | 44,732 | 5.9 | % | |||||||||||||||||
Canada | 1,821 | 2,470 | — | 223 | (36 | ) | 4,478 | 0.6 | % | |||||||||||||||||
Rest of the world (b) | 3,259 | 29,806 | — | — | (457 | ) | 32,608 | 4.3 | % | |||||||||||||||||
Sub-total, non United States | 72,293 | 102,784 | — | 9,162 | (2,910 | ) | 181,329 | 23.8 | % | |||||||||||||||||
Worldwide including United States (a) | 35,561 | 34,198 | — | 52,394 | (380 | ) | 121,773 | 15.9 | % | |||||||||||||||||
Other locations non-specific (c) | 48,869 | 119,950 | — | 11 | (4 | ) | 168,826 | 22.1 | % | |||||||||||||||||
Total | $ | 285,810 | $ | 296,067 | $ | 86,971 | $ | 98,905 | $ | (3,711 | ) | $ | 764,042 | 100.0 | % |
Gross Premiums Written | ||||||||||||||||||||||||||
Three Months Ended June 30, 2015 | ||||||||||||||||||||||||||
Validus Re | Talbot | Western World | AlphaCat | Eliminations | Total | % | ||||||||||||||||||||
United States | $ | 171,006 | $ | 40,036 | $ | 79,554 | $ | 23,800 | $ | (428 | ) | $ | 313,968 | 43.3 | % | |||||||||||
Worldwide excluding United States (a) | 12,322 | 30,231 | — | 2,173 | 69 | 44,795 | 6.2 | % | ||||||||||||||||||
Australia and New Zealand | 1,643 | 1,173 | — | 624 | 25 | 3,465 | 0.5 | % | ||||||||||||||||||
Europe | 16,282 | 10,584 | — | 1,073 | (84 | ) | 27,855 | 3.8 | % | |||||||||||||||||
Latin America and Caribbean | 7,684 | 28,693 | — | — | (3,919 | ) | 32,458 | 4.5 | % | |||||||||||||||||
Japan | 37,800 | 2,843 | — | 1,671 | (45 | ) | 42,269 | 5.8 | % | |||||||||||||||||
Canada | 597 | 2,299 | — | 294 | (48 | ) | 3,142 | 0.4 | % | |||||||||||||||||
Rest of the world (b) | 3,026 | 24,982 | — | — | (294 | ) | 27,714 | 3.8 | % | |||||||||||||||||
Sub-total, non United States | 79,354 | 100,805 | — | 5,835 | (4,296 | ) | 181,698 | 25.0 | % | |||||||||||||||||
Worldwide including United States (a) | 37,967 | 32,704 | — | 32,410 | (2,021 | ) | 101,060 | 13.9 | % | |||||||||||||||||
Other locations non-specific (c) | 9,093 | 119,501 | — | 750 | 98 | 129,442 | 17.8 | % | ||||||||||||||||||
Total | $ | 297,420 | $ | 293,046 | $ | 79,554 | $ | 62,795 | $ | (6,647 | ) | $ | 726,168 | 100.0 | % |
(a) | Represents risks in two or more geographic zones. |
(b) | Represents risks in one geographic zone. |
(c) | The Other locations non-specific category refers to business for which an analysis of exposure by geographic zone is not applicable since these exposures can span multiple geographic areas and, in some instances, are not fixed locations. |
Gross Premiums Written | ||||||||||||||||||||||||||
Six Months Ended June 30, 2016 | ||||||||||||||||||||||||||
Validus Re | Talbot | Western World | AlphaCat | Eliminations | Total | % | ||||||||||||||||||||
United States | $ | 424,481 | $ | 65,245 | $ | 150,930 | $ | 62,729 | $ | (1,555 | ) | $ | 701,830 | 36.2 | % | |||||||||||
Worldwide excluding United States (a) | 47,239 | 65,532 | — | 22,507 | (611 | ) | 134,667 | 7.0 | % | |||||||||||||||||
Australia and New Zealand | 6,849 | 4,375 | — | 4,949 | (113 | ) | 16,060 | 0.8 | % | |||||||||||||||||
Europe | 25,734 | 20,716 | — | 3,306 | (708 | ) | 49,048 | 2.5 | % | |||||||||||||||||
Latin America and Caribbean | 19,574 | 51,404 | — | — | (5,537 | ) | 65,441 | 3.4 | % | |||||||||||||||||
Japan | 39,925 | 4,582 | — | 3,221 | (31 | ) | 47,697 | 2.5 | % | |||||||||||||||||
Canada | 3,497 | 3,562 | — | 223 | (87 | ) | 7,195 | 0.4 | % | |||||||||||||||||
Rest of the world (b) | 19,947 | 57,290 | — | — | (2,342 | ) | 74,895 | 3.9 | % | |||||||||||||||||
Sub-total, non United States | 162,765 | 207,461 | — | 34,206 | (9,429 | ) | 395,003 | 20.5 | % | |||||||||||||||||
Worldwide including United States (a) | 147,338 | 62,652 | — | 167,767 | (9,214 | ) | 368,543 | 19.0 | % | |||||||||||||||||
Other locations non-specific (c) | 242,894 | 227,026 | — | 1,551 | (14 | ) | 471,457 | 24.3 | % | |||||||||||||||||
Total | $ | 977,478 | $ | 562,384 | $ | 150,930 | $ | 266,253 | $ | (20,212 | ) | $ | 1,936,833 | 100.0 | % |
Gross Premiums Written | ||||||||||||||||||||||||||
Six Months Ended June 30, 2015 | ||||||||||||||||||||||||||
Validus Re | Talbot | Western World | AlphaCat | Eliminations | Total | % | ||||||||||||||||||||
United States | $ | 510,020 | $ | 68,094 | $ | 136,501 | $ | 36,945 | $ | (1,882 | ) | $ | 749,678 | 40.7 | % | |||||||||||
Worldwide excluding United States (a) | 47,288 | 65,173 | — | 8,006 | (933 | ) | 119,534 | 6.5 | % | |||||||||||||||||
Australia and New Zealand | 11,507 | 3,049 | — | 624 | (126 | ) | 15,054 | 0.8 | % | |||||||||||||||||
Europe | 41,017 | 23,798 | — | 2,512 | (904 | ) | 66,423 | 3.6 | % | |||||||||||||||||
Latin America and Caribbean | 16,932 | 51,385 | — | — | (7,813 | ) | 60,504 | 3.3 | % | |||||||||||||||||
Japan | 39,184 | 3,597 | — | 1,671 | (58 | ) | 44,394 | 2.4 | % | |||||||||||||||||
Canada | 2,782 | 3,997 | — | 488 | (124 | ) | 7,143 | 0.4 | % | |||||||||||||||||
Rest of the world (b) | 21,680 | 47,988 | — | — | (2,542 | ) | 67,126 | 3.6 | % | |||||||||||||||||
Sub-total, non United States | 180,390 | 198,987 | — | 13,301 | (12,500 | ) | 380,178 | 20.6 | % | |||||||||||||||||
Worldwide including United States (a) | 122,811 | 54,498 | — | 110,304 | (13,659 | ) | 273,954 | 14.8 | % | |||||||||||||||||
Other locations non-specific (c) | 195,892 | 241,544 | — | 4,050 | 96 | 441,582 | 23.9 | % | ||||||||||||||||||
Total | $ | 1,009,113 | $ | 563,123 | $ | 136,501 | $ | 164,600 | $ | (27,945 | ) | $ | 1,845,392 | 100.0 | % |
(a) | Represents risks in two or more geographic zones. |
(b) | Represents risks in one geographic zone. |
(c) | The Other locations non-specific category refers to business for which an analysis of exposure by geographic zone is not applicable since these exposures can span multiple geographic areas and, in some instances, are not fixed locations. |
June 30, 2016 | December 31, 2015 | ||
Book value per diluted common share plus accumulated dividends | $55.27 | $52.49 | |
Book value per diluted common share | $44.41 | $42.33 | |
Tangible book value per diluted common share | $40.65 | $38.63 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
(Dollars in thousands) | 2016 | 2015 | 2016 | 2015 | ||||
Underwriting income | $58,957 | $109,660 | $201,876 | $253,861 | ||||
Net operating income available to Validus common shareholders | $54,900 | $101,717 | $172,278 | $238,591 | ||||
Annualized return on average equity | 10.2% | 7.2% | 14.2% | 13.1% | ||||
Annualized net operating return on average equity | 5.9% | 11.1% | 9.3% | 13.1% |
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Underwriting revenues | ||||||||||||
Gross premiums written | $ | 764,042 | $ | 37,874 | $ | 726,168 | ||||||
Reinsurance premiums ceded | (36,229 | ) | 19,189 | (55,418 | ) | |||||||
Net premiums written | 727,813 | 57,063 | 670,750 | |||||||||
Change in unearned premiums | (154,090 | ) | (56,028 | ) | (98,062 | ) | ||||||
Net premiums earned | 573,723 | 1,035 | 572,688 | |||||||||
Other insurance related income | 745 | 37 | 708 | |||||||||
Total underwriting revenues | 574,468 | 1,072 | 573,396 | |||||||||
Underwriting deductions | ||||||||||||
Losses and loss expenses | 307,130 | 40,984 | 266,146 | |||||||||
Policy acquisition costs | 107,966 | 3,643 | 104,323 | |||||||||
General and administrative expenses | 89,688 | 5,663 | 84,025 | |||||||||
Share compensation expenses | 10,727 | 1,485 | 9,242 | |||||||||
Total underwriting deductions | 515,511 | 51,775 | 463,736 | |||||||||
Underwriting income (a) | $ | 58,957 | $ | (50,703 | ) | $ | 109,660 | |||||
Net investment income | 39,257 | 5,646 | 33,611 | |||||||||
Finance expenses | (14,166 | ) | 4,516 | (18,682 | ) | |||||||
Dividends on preferred shares | — | — | — | |||||||||
Tax expense | (1,706 | ) | 843 | (2,549 | ) | |||||||
Income from operating affiliates | — | (1,738 | ) | 1,738 | ||||||||
(Income) attributable to AlphaCat investors | (6,114 | ) | (6,114 | ) | — | |||||||
Net (income) attributable to noncontrolling interest | (21,328 | ) | 733 | (22,061 | ) | |||||||
Net operating income available to Validus common shareholders (a) | $ | 54,900 | $ | (46,817 | ) | $ | 101,717 | |||||
Supplemental information: | ||||||||||||
Losses and loss expenses | ||||||||||||
Current period excluding items below | $ | 284,704 | $ | (19,086 | ) | $ | 303,790 | |||||
Current period—notable loss events | 36,915 | (11,159 | ) | 48,074 | ||||||||
Current period—non-notable loss events | 48,292 | 63,292 | (15,000 | ) | ||||||||
Change in prior accident years | (62,781 | ) | 7,937 | (70,718 | ) | |||||||
Total losses and loss expenses | $ | 307,130 | $ | 40,984 | $ | 266,146 | ||||||
Selected ratios: | ||||||||||||
Net premiums written / Gross premiums written | 95.3 | % | 2.9 | 92.4 | % | |||||||
Losses and loss expense ratio | ||||||||||||
Current period excluding items below | 49.6 | % | (3.4 | ) | 53.0 | % | ||||||
Current period—notable loss events | 6.4 | % | (2.0 | ) | 8.4 | % | ||||||
Current period—non-notable loss events | 8.4 | % | 11.0 | (2.6 | )% | |||||||
Change in prior accident years | (10.9 | )% | 1.4 | (12.3 | )% | |||||||
Losses and loss expenses | 53.5 | % | 7.0 | 46.5 | % | |||||||
Policy acquisition costs | 18.8 | % | 0.6 | 18.2 | % | |||||||
General and administrative expenses (b) | 17.6 | % | 1.3 | 16.3 | % | |||||||
Expense ratio | 36.4 | % | 1.9 | 34.5 | % | |||||||
Combined ratio | 89.9 | % | 8.9 | 81.0 | % |
(a) | Non-GAAP Financial Measures. In presenting the Company’s results, management has included and discussed underwriting income and operating income that are not calculated under standards or rules that comprise U.S. GAAP. Such measures are referred to as non-GAAP. Non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those determined in accordance with U.S. GAAP. Further discussion of these measures is presented in the section entitled “Non-GAAP Financial Measures.” |
(b) | The general and administrative expense ratio includes share compensation expenses. |
• | Gross premiums written for the three months ended June 30, 2016 were $764.0 million compared to $726.2 million for the three months ended June 30, 2015, an increase of $37.9 million, or 5.2%. The increase was primarily driven by an increase in the AlphaCat, Western World and Talbot segments, partially offset by a decrease in the Validus Re segment discussed further as follows: |
◦ | Gross premiums written in the AlphaCat segment, on behalf of the Company's variable interest entities ("VIEs"), were $98.9 million for the three months ended June 30, 2016, compared to $62.8 million for the three months ended June 30, 2015, an increase of $36.1 million or 57.5%, primarily due to an increase in the capital base of the AlphaCat ILS Funds. |
◦ | Gross premiums written for the three months ended June 30, 2016 in the Western World segment were $87.0 million compared to $79.6 million for the three months ended June 30, 2015, an increase of $7.4 million or 9.3%, primarily driven by an increase in the property lines as a result of continued enhancements to the underwriting platform. |
◦ | Gross premiums written for the three months ended June 30, 2016 in the Talbot segment were $296.1 million compared to $293.0 million for the three months ended June 30, 2015, an increase of $3.0 million or 1.0%. |
◦ | Gross premiums written for the three months ended June 30, 2016 in the Validus Re segment were $285.8 million compared to $297.4 million for the three months ended June 30, 2015, a decrease of $11.6 million or 3.9%. The decrease was primarily driven by a decrease in the property lines due to the timing of renewals, current market conditions and increased cessions to AlphaCat, partially offset by an increase in the specialty lines. |
• | Underwriting revenues for the three months ended June 30, 2016 were $574.5 million compared to $573.4 million for the three months ended June 30, 2015, an increase of $1.1 million or 0.2%. |
• | Losses and loss expenses for the three months ended June 30, 2016 were $307.1 million compared to $266.1 million for the three months ended June 30, 2015, an increase of $41.0 million or 15.4%, primarily as a result of increased non-notable loss events incurred during the three months ended June 30, 2016. |
• | Gross losses and loss expenses from the Canadian Wildfires notable loss event, defined as consolidated net losses which aggregate to a threshold greater than or equal to $30.0 million, were $73.5 million for the three months ended June 30, 2016. Net of reinsurance recoveries of $36.6 million, the Company's share of net losses and loss expenses from the loss event was $36.9 million, or 6.4 percentage points of the loss ratio during the three months ended June 30, 2016. Net of losses of $6.4 million attributable to AlphaCat investors and noncontrolling interest and reinstatement premiums of $3.6 million, the net loss attributable to the Company was $26.9 million. During the three months ended June 30, 2015, the Company incurred a single notable loss event, Pemex, which resulted in an estimated net loss attributable to the Company of $48.1 million, or 8.4 percentage points of the loss ratio. Including reinstatement premiums of $0.4 million, the net loss attributable to the Company was $48.5 million. |
• | Gross losses and loss expenses from the Texas Hailstorms, Kumamoto Earthquake and Jubilee Oil non-notable loss events, defined as consolidated net losses which aggregate to a threshold greater than or equal to $15.0 million but less than $30.0 million, were $92.5 million for the three months ended June 30, 2016. Net of reinsurance recoveries of $44.2 million, the Company's aggregate share of net losses and loss expenses from non-notable loss events was $48.3 million, or 8.4 percentage points of the loss ratio. Net of losses of $5.5 million attributable to AlphaCat investors and noncontrolling interest and reinstatement premiums of $9.7 million, the net loss attributable to the Company was $33.1 million. Losses and loss expenses from non-notable loss events for the three months ended June 30, 2015 were $(15.0) million, or (2.6) percentage points of the loss ratio which represented a reserve release on the first quarter 2015 non-notable loss event, Windstorm Niklas. |
• | Loss ratios by line of business were as follows: |
Three Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Property | 53.1 | % | 41.5 | 11.6 | % | |||
Marine | 35.1 | % | (29.7 | ) | 64.8 | % | ||
Specialty | 60.3 | % | (6.8 | ) | 67.1 | % | ||
Liability | 66.1 | % | (4.5 | ) | 70.6 | % | ||
All lines | 53.5 | % | 7.0 | 46.5 | % |
• | The loss ratio for the three months ended June 30, 2016 was 53.5% which included $62.8 million of favorable loss reserve development on prior accident years, benefiting the loss ratio by 10.9 percentage points compared to a loss ratio for the three months ended June 30, 2015 of 46.5% which included $70.7 million of favorable loss reserve development on prior accident years, benefiting the loss ratio by 12.3 percentage points. The favorable development of $62.8 million for the three months ended June 30, 2016 was primarily due to favorable development on non-event reserves of $56.3 million and favorable development on prior years from events of $6.5 million. The term events refers to aggregate notable and non-notable losses incurred. |
• | The combined ratio for the three months ended June 30, 2016 was 89.9% compared to 81.0% for the three months ended June 30, 2015. |
• | Policy acquisition costs for the three months ended June 30, 2016 were $108.0 million compared to $104.3 million for the three months ended June 30, 2015, an increase of $3.6 million or 3.5%, primarily driven by an increase in the Western World segment due to the impact of the acquisition fair value adjustments during the three months ended June 30, 2015. |
• | Underwriting income for the three months ended June 30, 2016 was $59.0 million compared to $109.7 million for the three months ended June 30, 2015, a decrease of $50.7 million or 46.2% primarily as a result of the changes in underwriting revenues and deductions described above. |
• | Net operating income available to Validus common shareholders for the three months ended June 30, 2016 was $54.9 million compared to $101.7 million for the three months ended June 30, 2015, a decrease of $46.8 million, or 46.0%. |
• | Net income available to Validus common shareholders for the three months ended June 30, 2016 was $95.0 million compared to $65.8 million for the three months ended June 30, 2015, an increase of $29.2 million, or 44.3%. |
• | Annualized return on average equity was 10.2% and annualized net operating return on average equity was 5.9% for the three months ended June 30, 2016 compared to 7.2% and 11.1%, respectively, for the three months ended June 30, 2015. |
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Underwriting revenues | ||||||||||||
Gross premiums written | $ | 285,810 | $ | (11,610 | ) | $ | 297,420 | |||||
Reinsurance premiums ceded | (3,196 | ) | 16,182 | (19,378 | ) | |||||||
Net premiums written | 282,614 | 4,572 | 278,042 | |||||||||
Change in unearned premiums | (35,492 | ) | (22,000 | ) | (13,492 | ) | ||||||
Net premiums earned | 247,122 | (17,428 | ) | 264,550 | ||||||||
Other insurance related income | 150 | (284 | ) | 434 | ||||||||
Total underwriting revenues | 247,272 | (17,712 | ) | 264,984 | ||||||||
Underwriting deductions | ||||||||||||
Losses and loss expenses | 132,139 | 8,734 | 123,405 | |||||||||
Policy acquisition costs | 42,564 | (1,262 | ) | 43,826 | ||||||||
General and administrative expenses | 17,872 | (909 | ) | 18,781 | ||||||||
Share compensation expenses | 2,775 | 379 | 2,396 | |||||||||
Total underwriting deductions | 195,350 | 6,942 | 188,408 | |||||||||
Underwriting income (a) | $ | 51,922 | $ | (24,654 | ) | $ | 76,576 | |||||
Supplemental information: | ||||||||||||
Losses and loss expenses | ||||||||||||
Current period excluding items below | $ | 112,676 | $ | (21,419 | ) | $ | 134,095 | |||||
Current period—notable loss events | 17,884 | (17,305 | ) | 35,189 | ||||||||
Current period—non-notable loss events | 32,456 | 47,456 | (15,000 | ) | ||||||||
Change in prior accident years | (30,877 | ) | 2 | (30,879 | ) | |||||||
Total losses and loss expenses | $ | 132,139 | $ | 8,734 | $ | 123,405 | ||||||
Selected ratios: | ||||||||||||
Net premiums written / Gross premiums written | 98.9 | % | 5.4 | 93.5 | % | |||||||
Losses and loss expense ratio | ||||||||||||
Current period excluding items below | 45.7 | % | (5.0 | ) | 50.7 | % | ||||||
Current period—notable loss events | 7.2 | % | (6.1 | ) | 13.3 | % | ||||||
Current period—non-notable loss events | 13.1 | % | 18.8 | (5.7 | )% | |||||||
Change in prior accident years | (12.5 | )% | (0.8 | ) | (11.7 | )% | ||||||
Losses and loss expenses | 53.5 | % | 6.9 | 46.6 | % | |||||||
Policy acquisition costs | 17.2 | % | 0.6 | 16.6 | % | |||||||
General and administrative expenses (b) | 8.4 | % | 0.4 | 8.0 | % | |||||||
Expense ratio | 25.6 | % | 1.0 | 24.6 | % | |||||||
Combined ratio | 79.1 | % | 7.9 | 71.2 | % |
(a) | Non-GAAP Financial Measures. In presenting the Company’s results, management has included and discussed underwriting income that is not calculated under standards or rules that comprise U.S. GAAP. Such measures are referred to as non-GAAP. Non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those determined in accordance with U.S. GAAP. Further discussion of these measures is presented in the section entitled “Non-GAAP Financial Measures.” |
(b) | The general and administrative expense ratio includes share compensation expenses. |
Business Mix - Ratio of Gross Premiums Written by Line of Business to Total Gross Premiums Written | |||||||||||||||||||||
Three Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | |||||||||||||||
Property | $ | 216,034 | 75.6 | % | $ | (30,591 | ) | (7.3 | ) | $ | 246,625 | 82.9 | % | ||||||||
Marine | 7,806 | 2.7 | % | 1,261 | 0.5 | 6,545 | 2.2 | % | |||||||||||||
Specialty | 61,970 | 21.7 | % | 17,720 | 6.8 | 44,250 | 14.9 | % | |||||||||||||
Total | $ | 285,810 | 100.0 | % | $ | (11,610 | ) | $ | 297,420 | 100.0 | % |
Reinsurance Premiums Ceded | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 8,892 | $ | (8,730 | ) | $ | 17,622 | |||||
Marine | (868 | ) | (2,349 | ) | 1,481 | |||||||
Specialty | (4,828 | ) | (5,103 | ) | 275 | |||||||
Total | $ | 3,196 | $ | (16,182 | ) | $ | 19,378 |
Net Retention - Ratio of Net Premiums Written to Gross Premiums Written | ||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||
2016 | Change | 2015 | ||||||||||||||||||
(Dollars in thousands) | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | ||||||||||||||
Property | $ | 207,142 | 95.9 | % | $ | (21,861 | ) | 3.0 | $ | 229,003 | 92.9 | % | ||||||||
Marine | 8,674 | 111.1 | % | 3,610 | 33.7 | 5,064 | 77.4 | % | ||||||||||||
Specialty | 66,798 | 107.8 | % | 22,823 | 8.4 | 43,975 | 99.4 | % | ||||||||||||
Total | $ | 282,614 | 98.9 | % | $ | 4,572 | 5.4 | $ | 278,042 | 93.5 | % |
Net Premiums Earned | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 105,228 | $ | (1,965 | ) | $ | 107,193 | |||||
Marine | 31,097 | (13,319 | ) | 44,416 | ||||||||
Specialty | 110,797 | (2,144 | ) | 112,941 | ||||||||
Total | $ | 247,122 | $ | (17,428 | ) | $ | 264,550 |
Losses and Loss Expense Ratio - All Lines | ||||||||
Three Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
All lines—current period excluding items below | 45.7 | % | (5.0 | ) | 50.7 | % | ||
All lines—current period—notable loss events | 7.2 | % | (6.1 | ) | 13.3 | % | ||
All lines—current period—non-notable loss events | 13.1 | % | 18.8 | (5.7) | % | |||
All lines—change in prior accident years | (12.5 | )% | (0.8 | ) | (11.7 | )% | ||
All lines—loss ratio | 53.5 | % | 6.9 | 46.6 | % |
Losses and Loss Expenses - All Lines | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
All lines—current period excluding items below | $ | 112,676 | $ | (21,419 | ) | $ | 134,095 | |||||
All lines—current period—notable loss events | 17,884 | (17,305 | ) | 35,189 | ||||||||
All lines—current period—non-notable loss events | 32,456 | 47,456 | (15,000 | ) | ||||||||
All lines—change in prior accident years | (30,877 | ) | 2 | (30,879 | ) | |||||||
All lines—losses and loss expenses | $ | 132,139 | $ | 8,734 | $ | 123,405 |
Losses and Loss Expense Ratio - Property Lines | ||||||||
Three Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Property—current period excluding items below | 20.3 | % | (8.3 | ) | 28.6 | % | ||
Property—current period—notable loss events | 17.0 | % | 17.0 | 0.0 | % | |||
Property—current period—non-notable loss events | 21.0 | % | 35.0 | (14.0) | % | |||
Property—change in prior accident years | (9.0) | % | 5.9 | (14.9) | % | |||
Property—loss ratio | 49.3 | % | 49.6 | (0.3 | )% |
Losses and Loss Expenses - Property Lines | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property—current period excluding items below | $ | 21,361 | $ | (9,251 | ) | $ | 30,612 | |||||
Property—current period—notable loss events | 17,884 | 17,884 | — | |||||||||
Property—current period—non-notable loss events | 22,079 | 37,079 | (15,000 | ) | ||||||||
Property—change in prior accident years | (9,468 | ) | 6,460 | (15,928 | ) | |||||||
Property—losses and loss expenses | $ | 51,856 | $ | 52,172 | $ | (316 | ) |
Losses and Loss Expense Ratio - Marine Lines | ||||||||
Three Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Marine—current period excluding items below | 52.3 | % | 9.6 | 42.7 | % | |||
Marine—current period—notable loss events | 0.0 | % | (75.5 | ) | 75.5 | % | ||
Marine—current period—non-notable loss events | 2.2 | % | 2.2 | 0.0 | % | |||
Marine—change in prior accident years | (32.2 | )% | (7.2 | ) | (25.0 | )% | ||
Marine—loss ratio | 22.3 | % | (70.9 | ) | 93.2 | % |
Losses and Loss Expenses - Marine Lines | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Marine—current period excluding items below | $ | 16,269 | $ | (2,702 | ) | $ | 18,971 | |||||
Marine—current period—notable loss events | — | (33,524 | ) | 33,524 | ||||||||
Marine—current period—non-notable loss events | 670 | 670 | — | |||||||||
Marine—change in prior accident years | (10,018 | ) | 1,081 | (11,099 | ) | |||||||
Marine—losses and loss expenses | $ | 6,921 | $ | (34,475 | ) | $ | 41,396 |
Losses and Loss Expense Ratio - Specialty Lines | ||||||||
Three Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Specialty—current period excluding items below | 67.7 | % | (7.1 | ) | 74.8 | % | ||
Specialty—current period—notable loss events | 0.0 | % | (1.5 | ) | 1.5 | % | ||
Specialty—current period—non-notable loss events | 8.8 | % | 8.8 | 0.0 | % | |||
Specialty—change in prior accident years | (10.3 | )% | (6.9 | ) | (3.4 | )% | ||
Specialty—loss ratio | 66.2 | % | (6.7 | ) | 72.9 | % |
Losses and Loss Expenses - Specialty Lines | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Specialty—current period excluding items below | $ | 75,046 | $ | (9,466 | ) | $ | 84,512 | |||||
Specialty—current period—notable loss events | — | (1,665 | ) | 1,665 | ||||||||
Specialty—current period—non-notable loss events | 9,707 | 9,707 | — | |||||||||
Specialty—change in prior accident years | (11,391 | ) | (7,539 | ) | (3,852 | ) | ||||||
Specialty—losses and loss expenses | $ | 73,362 | $ | (8,963 | ) | $ | 82,325 |
Policy Acquisition Costs | |||||||||||||||||||||
Three Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | |||||||||||||||
Property | $ | 18,269 | 17.4 | % | $ | (172 | ) | 0.2 | $ | 18,441 | 17.2 | % | |||||||||
Marine | 5,281 | 17.0 | % | (2,497 | ) | (0.5 | ) | 7,778 | 17.5 | % | |||||||||||
Specialty | 19,014 | 17.2 | % | 1,407 | 1.6 | 17,607 | 15.6 | % | |||||||||||||
Total | $ | 42,564 | 17.2 | % | $ | (1,262 | ) | 0.6 | $ | 43,826 | 16.6 | % |
Underwriting Income Before General and Administrative and Share Compensation Expenses | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 35,103 | $ | (53,965 | ) | $ | 89,068 | |||||
Marine | 18,895 | 23,653 | (4,758 | ) | ||||||||
Specialty | 18,421 | 5,412 | 13,009 | |||||||||
Other insurance related income | 150 | (284 | ) | 434 | ||||||||
Total | $ | 72,569 | $ | (25,184 | ) | $ | 97,753 |
General and Administrative and Share Compensation Expenses | ||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||
2016 | Change | 2015 | ||||||||||||||||||
(Dollars in thousands) | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | ||||||||||||||
General and administrative expenses | $ | 17,872 | 7.2 | % | $ | (909 | ) | 0.1 | $ | 18,781 | 7.1 | % | ||||||||
Share compensation expenses | 2,775 | 1.2 | % | 379 | 0.3 | 2,396 | 0.9 | % | ||||||||||||
Total | $ | 20,647 | 8.4 | % | $ | (530 | ) | 0.4 | $ | 21,177 | 8.0 | % |
Three Months Ended June 30, | |||||||
2016 | Change | 2015 | |||||
Losses and loss expense ratio | 53.5 | % | 6.9 | 46.6 | % | ||
Policy acquisition cost ratio | 17.2 | % | 0.6 | 16.6 | % | ||
General and administrative expense ratio (a) | 8.4 | % | 0.4 | 8.0 | % | ||
Expense ratio | 25.6 | % | 1.0 | 24.6 | % | ||
Combined ratio | 79.1 | % | 7.9 | 71.2 | % |
(a) | The general and administrative expense ratio includes share compensation expenses. |
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Underwriting revenues | ||||||||||||
Gross premiums written | $ | 296,067 | $ | 3,021 | $ | 293,046 | ||||||
Reinsurance premiums ceded | (27,161 | ) | 10,085 | (37,246 | ) | |||||||
Net premiums written | 268,906 | 13,106 | 255,800 | |||||||||
Change in unearned premiums | (67,357 | ) | (16,995 | ) | (50,362 | ) | ||||||
Net premiums earned | 201,549 | (3,889 | ) | 205,438 | ||||||||
Other insurance related income | 279 | 239 | 40 | |||||||||
Total underwriting revenues | 201,828 | (3,650 | ) | 205,478 | ||||||||
Underwriting deductions | ||||||||||||
Losses and loss expenses | 109,310 | 13,340 | 95,970 | |||||||||
Policy acquisition costs | 43,613 | (4,046 | ) | 47,659 | ||||||||
General and administrative expenses | 39,061 | 3,506 | 35,555 | |||||||||
Share compensation expenses | 3,270 | 246 | 3,024 | |||||||||
Total underwriting deductions | 195,254 | 13,046 | 182,208 | |||||||||
Underwriting income (a) | $ | 6,574 | $ | (16,696 | ) | $ | 23,270 | |||||
Supplemental information: | ||||||||||||
Losses and loss expenses | ||||||||||||
Current period excluding items below | $ | 116,824 | $ | (1,847 | ) | $ | 118,671 | |||||
Current period—notable loss events | 11,703 | (1,182 | ) | 12,885 | ||||||||
Current period—non-notable loss events | 9,111 | 9,111 | — | |||||||||
Change in prior accident years | (28,328 | ) | 7,258 | (35,586 | ) | |||||||
Total losses and loss expenses | $ | 109,310 | $ | 13,340 | $ | 95,970 | ||||||
Selected ratios: | ||||||||||||
Net premiums written / Gross premiums written | 90.8 | % | 3.5 | 87.3 | % | |||||||
Losses and loss expense ratio | ||||||||||||
Current period excluding items below | 58.0 | % | 0.3 | 57.7 | % | |||||||
Current period—notable loss events | 5.8 | % | (0.5 | ) | 6.3 | % | ||||||
Current period—non-notable loss events | 4.5 | % | 4.5 | — | % | |||||||
Change in prior accident years | (14.1 | )% | 3.2 | (17.3 | )% | |||||||
Losses and loss expenses | 54.2 | % | 7.5 | 46.7 | % | |||||||
Policy acquisition costs | 21.6 | % | (1.6 | ) | 23.2 | % | ||||||
General and administrative expenses (b) | 21.1 | % | 2.3 | 18.8 | % | |||||||
Expense ratio | 42.7 | % | 0.7 | 42.0 | % | |||||||
Combined ratio | 96.9 | % | 8.2 | 88.7 | % |
(a) | Non-GAAP Financial Measures. In presenting the Company’s results, management has included and discussed underwriting income that is not calculated under standards or rules that comprise U.S. GAAP. Such measures are referred to as non-GAAP. Non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those determined in accordance with U.S. GAAP. Further discussion of these measures is presented in the section entitled “Non-GAAP Financial Measures.” |
(b) | The general and administrative expense ratio includes share compensation expenses. |
Business Mix - Ratio of Gross Premiums Written by Line of Business to Total Gross Premiums Written | |||||||||||||||||||||
Three Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | |||||||||||||||
Property | $ | 111,646 | 37.8 | % | $ | 2,828 | 0.7 | $ | 108,818 | 37.1 | % | ||||||||||
Marine | 85,992 | 29.0 | % | (3,717 | ) | (1.6 | ) | 89,709 | 30.6 | % | |||||||||||
Specialty | 98,429 | 33.2 | % | 3,910 | 0.9 | 94,519 | 32.3 | % | |||||||||||||
Total | $ | 296,067 | 100.0 | % | $ | 3,021 | $ | 293,046 | 100.0 | % |
Reinsurance Premiums Ceded | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 19,733 | $ | (2,589 | ) | $ | 22,322 | |||||
Marine | 4,729 | (6,120 | ) | 10,849 | ||||||||
Specialty | 2,699 | (1,376 | ) | 4,075 | ||||||||
Total | $ | 27,161 | $ | (10,085 | ) | $ | 37,246 |
Net Retention - Ratio of Net Premiums Written to Gross Premiums Written | ||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||
2016 | Change | 2015 | ||||||||||||||||||
(Dollars in thousands) | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | ||||||||||||||
Property | $ | 91,913 | 82.3 | % | $ | 5,417 | 2.8 | $ | 86,496 | 79.5 | % | |||||||||
Marine | 81,263 | 94.5 | % | 2,403 | 6.6 | 78,860 | 87.9 | % | ||||||||||||
Specialty | 95,730 | 97.3 | % | 5,286 | 1.6 | 90,444 | 95.7 | % | ||||||||||||
Total | $ | 268,906 | 90.8 | % | $ | 13,106 | 3.5 | $ | 255,800 | 87.3 | % |
Net Premiums Earned | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 54,859 | $ | (1,080 | ) | $ | 55,939 | |||||
Marine | 73,922 | (3,874 | ) | 77,796 | ||||||||
Specialty | 72,768 | 1,065 | 71,703 | |||||||||
Total | $ | 201,549 | $ | (3,889 | ) | $ | 205,438 |
Losses and Loss Expense Ratio - All Lines | ||||||||
Three Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
All lines—current period excluding items below | 58.0 | % | 0.3 | 57.7 | % | |||
All lines—current period—notable loss events | 5.8 | % | (0.5 | ) | 6.3 | % | ||
All lines—current period—non-notable loss events | 4.5 | % | 4.5 | 0.0 | % | |||
All lines—change in prior accident years | (14.1) | % | 3.2 | (17.3) | % | |||
All lines—loss ratio | 54.2 | % | 7.5 | 46.7 | % |
Losses and Loss Expenses - All Lines | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
All lines—current period excluding items below | $ | 116,824 | $ | (1,847 | ) | $ | 118,671 | |||||
All lines—current period—notable loss events | 11,703 | (1,182 | ) | 12,885 | ||||||||
All lines—current period—non-notable loss events | 9,111 | 9,111 | — | |||||||||
All lines—change in prior accident years | (28,328 | ) | 7,258 | (35,586 | ) | |||||||
All lines - losses and loss expenses | $ | 109,310 | $ | 13,340 | $ | 95,970 |
Losses and Loss Expense Ratio - Property Lines | |||||||
Three Months Ended June 30, | |||||||
2016 | Change | 2015 | |||||
Property—current period excluding items below | 63.8 | % | 5.2 | 58.6 | % | ||
Property—current period—notable loss events | 21.3 | % | 20.5 | 0.8 | % | ||
Property—current period—non-notable loss events | 7.8 | % | 7.8 | 0.0 | % | ||
Property—change in prior accident years | (18.4) | % | 11.4 | (29.8) | % | ||
Property—loss ratio | 74.5 | % | 44.9 | 29.6 | % |
Losses and Loss Expenses - Property Lines | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property—current period excluding items below | $ | 34,973 | $ | 2,165 | $ | 32,808 | ||||||
Property—current period—notable loss events | 11,703 | 11,277 | 426 | |||||||||
Property—current period—non-notable loss events | 4,274 | 4,274 | — | |||||||||
Property—change in prior accident years | (10,094 | ) | 6,589 | (16,683 | ) | |||||||
Property—losses and loss expenses | $ | 40,856 | $ | 24,305 | $ | 16,551 |
Losses and Loss Expense Ratio - Marine Lines | ||||||||
Three Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Marine—current period excluding items below | 46.1 | % | (4.2 | ) | 50.3 | % | ||
Marine—current period—notable loss events | 0.0 | % | (16.0 | ) | 16.0 | % | ||
Marine—current period—non-notable loss events | 6.5 | % | 6.5 | 0.0 | % | |||
Marine—change in prior accident years | (12.1 | )% | 5.7 | (17.8 | )% | |||
Marine—loss ratio | 40.5 | % | (8.0 | ) | 48.5 | % |
Losses and Loss Expenses - Marine Lines | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Marine—current period excluding items below | $ | 34,013 | $ | (5,097 | ) | $ | 39,110 | |||||
Marine—current period—notable loss events | — | (12,459 | ) | 12,459 | ||||||||
Marine—current period—non-notable loss events | 4,837 | 4,837 | — | |||||||||
Marine—change in prior accident years | (8,928 | ) | 4,882 | (13,810 | ) | |||||||
Marine—losses and loss expenses | $ | 29,922 | $ | (7,837 | ) | $ | 37,759 |
Losses and Loss Expense Ratio - Specialty Lines | ||||||||
Three Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Specialty—current period excluding items below | 65.8 | % | 0.6 | 65.2 | % | |||
Specialty—current period—notable loss events | 0.0 | % | 0.0 | 0.0 | % | |||
Specialty—current period—non-notable loss events | 0.0 | % | 0.0 | 0.0 | % | |||
Specialty—change in prior accident years | (12.8 | )% | (5.7 | ) | (7.1) | % | ||
Specialty—loss ratio | 53.0 | % | (5.1 | ) | 58.1 | % |
Losses and Loss Expenses - Specialty Lines | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Specialty—current period excluding items below | $ | 47,838 | $ | 1,085 | $ | 46,753 | ||||||
Specialty—current period—notable loss events | — | — | — | |||||||||
Specialty—current period—non-notable loss events | — | — | — | |||||||||
Specialty—change in prior accident years | (9,306 | ) | (4,213 | ) | (5,093 | ) | ||||||
Specialty—losses and loss expenses | $ | 38,532 | $ | (3,128 | ) | $ | 41,660 |
Policy Acquisition Costs | |||||||||||||||||||||
Three Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | |||||||||||||||
Property | $ | 9,057 | 16.5 | % | $ | 836 | 1.8 | $ | 8,221 | 14.7 | % | ||||||||||
Marine | 17,582 | 23.8 | % | (4,555 | ) | (4.7 | ) | 22,137 | 28.5 | % | |||||||||||
Specialty | 16,974 | 23.3 | % | (327 | ) | (0.8 | ) | 17,301 | 24.1 | % | |||||||||||
Total | $ | 43,613 | 21.6 | % | $ | (4,046 | ) | (1.6 | ) | $ | 47,659 | 23.2 | % |
Underwriting Income Before General and Administrative and Share Compensation Expenses | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 4,946 | $ | (26,221 | ) | $ | 31,167 | |||||
Marine | 26,418 | 8,518 | 17,900 | |||||||||
Specialty | 17,262 | 4,520 | 12,742 | |||||||||
Other insurance related income | 279 | 239 | 40 | |||||||||
Total | $ | 48,905 | $ | (12,944 | ) | $ | 61,849 |
General and Administrative and Share Compensation Expenses | ||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||
2016 | Change | 2015 | ||||||||||||||||||
(Dollars in thousands) | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | ||||||||||||||
General and administrative expenses | $ | 39,061 | 19.5 | % | $ | 3,506 | 2.2 | $ | 35,555 | 17.3 | % | |||||||||
Share compensation expenses | 3,270 | 1.6 | % | 246 | 0.1 | 3,024 | 1.5 | % | ||||||||||||
Total | $ | 42,331 | 21.1 | % | $ | 3,752 | 2.3 | $ | 38,579 | 18.8 | % |
Three Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Losses and loss expense ratio | 54.2 | % | 7.5 | 46.7 | % | |||
Policy acquisition cost ratio | 21.6 | % | (1.6 | ) | 23.2 | % | ||
General and administrative expense ratio (a) | 21.1 | % | 2.3 | 18.8 | % | |||
Expense ratio | 42.7 | % | 0.7 | 42.0 | % | |||
Combined ratio | 96.9 | % | 8.2 | 88.7 | % |
(a) | The general and administrative expense ratio includes share compensation expenses. |
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Underwriting revenues | ||||||||||||
Gross premiums written | $ | 86,971 | $ | 7,417 | $ | 79,554 | ||||||
Reinsurance premiums ceded | (5,006 | ) | 435 | (5,441 | ) | |||||||
Net premiums written | 81,965 | 7,852 | 74,113 | |||||||||
Change in unearned premiums | (16,309 | ) | (7,314 | ) | (8,995 | ) | ||||||
Net premiums earned | 65,656 | 538 | 65,118 | |||||||||
Other insurance related income | 189 | (87 | ) | 276 | ||||||||
Total underwriting revenues | 65,845 | 451 | 65,394 | |||||||||
Underwriting deductions | ||||||||||||
Losses and loss expenses | 44,229 | (2,542 | ) | 46,771 | ||||||||
Policy acquisition costs | 15,410 | 5,793 | 9,617 | |||||||||
General and administrative expenses | 11,458 | 2,535 | 8,923 | |||||||||
Share compensation expenses | 542 | 48 | 494 | |||||||||
Total underwriting deductions | 71,639 | 5,834 | 65,805 | |||||||||
Underwriting loss (a) | $ | (5,794 | ) | $ | (5,383 | ) | $ | (411 | ) | |||
Supplemental information: | ||||||||||||
Losses and loss expenses | ||||||||||||
Current period excluding items below | $ | 46,762 | $ | (4,262 | ) | $ | 51,024 | |||||
Current period—notable loss events | — | — | — | |||||||||
Current period—non-notable loss events | 625 | 625 | — | |||||||||
Change in prior accident years | (3,158 | ) | 1,095 | (4,253 | ) | |||||||
Total losses and loss expenses | $ | 44,229 | $ | (2,542 | ) | $ | 46,771 | |||||
Selected ratios: | ||||||||||||
Net premiums written / Gross premiums written | 94.2 | % | 1.0 | 93.2 | % | |||||||
Losses and loss expense ratio | ||||||||||||
Current period excluding items below | 71.2 | % | (7.1 | ) | 78.3 | % | ||||||
Current period—notable loss events | — | % | — | — | % | |||||||
Current period—non-notable loss events | 1.0 | % | 1.0 | — | % | |||||||
Change in prior accident years | (4.8 | )% | 1.7 | (6.5 | )% | |||||||
Losses and loss expenses | 67.4 | % | (4.4 | ) | 71.8 | % | ||||||
Policy acquisition costs | 23.5 | % | 8.7 | 14.8 | % | |||||||
General and administrative expenses (b) | 18.2 | % | 3.7 | 14.5 | % | |||||||
Expense ratio | 41.7 | % | 12.4 | 29.3 | % | |||||||
Combined ratio | 109.1 | % | 8.0 | 101.1 | % |
(a) | Non-GAAP Financial Measures. In presenting the Company’s results, management has included and discussed underwriting income that is not calculated under standards or rules that comprise U.S. GAAP. Such measures are referred to as non-GAAP. Non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those determined in accordance with U.S. GAAP. Further discussion of these measures is presented in the section entitled “Non-GAAP Financial Measures.” |
(b) | The general and administrative expense ratio includes share compensation expenses. |
Business Mix - Ratio of Gross Premiums Written by Line of Business to Total Gross Premiums Written | |||||||||||||||||||||
Three Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | |||||||||||||||
Property | $ | 26,218 | 30.1 | % | $ | 10,332 | 10.1 | $ | 15,886 | 20.0 | % | ||||||||||
Liability | 60,753 | 69.9 | % | (2,915 | ) | (10.1 | ) | 63,668 | 80.0 | % | |||||||||||
Total | $ | 86,971 | 100.0 | % | $ | 7,417 | $ | 79,554 | 100.0 | % |
Reinsurance Premiums Ceded | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 2,153 | $ | 782 | $ | 1,371 | ||||||
Liability | 2,853 | (1,217 | ) | 4,070 | ||||||||
Total | $ | 5,006 | $ | (435 | ) | $ | 5,441 |
Net Retention - Ratio of Net Premiums Written to Gross Premiums Written | ||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||
2016 | Change | 2015 | ||||||||||||||||||
(Dollars in thousands) | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | ||||||||||||||
Property | $ | 24,065 | 91.8 | % | $ | 9,550 | 0.4 | $ | 14,515 | 91.4 | % | |||||||||
Liability | 57,900 | 95.3 | % | (1,698 | ) | 1.7 | 59,598 | 93.6 | % | |||||||||||
Total | $ | 81,965 | 94.2 | % | $ | 7,852 | 1.0 | $ | 74,113 | 93.2 | % |
Net Premiums Earned | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 14,177 | $ | 3,450 | $ | 10,727 | ||||||
Liability | 51,479 | (2,912 | ) | 54,391 | ||||||||
Total | $ | 65,656 | $ | 538 | $ | 65,118 |
Losses and Loss Expense Ratio - All Lines | |||||||||
Three Months Ended June 30, | |||||||||
2016 | Change | 2015 | |||||||
All lines—current period excluding items below | 71.2 | % | (7.1 | ) | 78.3 | % | |||
All lines—current period—notable loss events | 0.0 | % | 0.0 | 0.0 | % | ||||
All lines—current period—non-notable loss events | 1.0 | % | 1.0 | 0.0 | % | ||||
All lines—change in prior accident years (a) | (4.8 | )% | 1.7 | (6.5 | )% | ||||
All lines—loss ratio (a) | 67.4 | % | (4.4 | ) | 71.8 | % |
Losses and Loss Expenses - All Lines | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
All lines—current period excluding items below | $ | 46,762 | $ | (4,262 | ) | $ | 51,024 | |||||
All lines—current period—notable loss events | — | — | — | |||||||||
All lines—current period—non-notable loss events | 625 | 625 | — | |||||||||
All lines—change in prior accident years (a) | (3,158 | ) | 1,095 | (4,253 | ) | |||||||
All lines—losses and loss expenses (a) | $ | 44,229 | $ | (2,542 | ) | $ | 46,771 |
(a) | Upon closing the acquisition, an adjustment of $15,586 was made to increase net reserves to reflect fair value. This adjustment was amortized to income through a reduction in losses and loss expenses of $2,892 during the three months ended June 30, 2015, benefiting the loss ratio by 4.4 percentage points. The remaining fair value adjustment of $4,864 was fully amortized during the year ended December 31, 2015. |
Losses and Loss Expense Ratio - Property Lines | |||||||||
Three Months Ended June 30, | |||||||||
2016 | Change | 2015 | |||||||
Property—current period excluding items below | 78.6 | % | (7.6 | ) | 86.2 | % | |||
Property—current period—notable loss events | 0.0 | % | 0.0 | 0.0 | % | ||||
Property—current period—non-notable loss events | 4.4 | % | 4.4 | 0.0 | % | ||||
Property—change in prior accident years (a) | (11.2 | )% | (3.1 | ) | (8.1 | )% | |||
Property—loss ratio (a) | 71.8 | % | (6.3 | ) | 78.1 | % |
Losses and Loss Expenses - Property Lines | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property—current period excluding items below | $ | 11,133 | $ | 1,890 | $ | 9,243 | ||||||
Property—current period—notable loss events | — | — | — | |||||||||
Property—current period—non-notable loss events | 625 | 625 | — | |||||||||
Property—change in prior accident years (a) | (1,582 | ) | (716 | ) | (866 | ) | ||||||
Property—losses and loss expenses (a) | $ | 10,176 | $ | 1,799 | $ | 8,377 |
(a) | Upon closing the acquisition, an adjustment of $409 was made to decrease net reserves to reflect fair value. This adjustment was amortized to income through an increase in losses and loss expenses of $76 during the three months ended June 30, 2015, increasing the loss ratio by 0.7 percentage points. The remaining fair value adjustment of $127 was fully amortized during the year ended December 31, 2015. |
Losses and Loss Expense Ratio - Liability Lines | |||||||||
Three Months Ended June 30, | |||||||||
2016 | Change | 2015 | |||||||
Liability—current period excluding items below | 69.2 | % | (7.6 | ) | 76.8 | % | |||
Liability—current period—notable loss events | 0.0 | % | 0.0 | 0.0 | % | ||||
Liability—current period—non-notable loss events | 0.0 | % | 0.0 | 0.0 | % | ||||
Liability—change in prior accident years (a) | (3.1 | )% | 3.1 | (6.2 | )% | ||||
Liability—loss ratio (a) | 66.1 | % | (4.5 | ) | 70.6 | % |
Losses and Loss Expenses - Liability Lines | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Liability—current period excluding items above | $ | 35,629 | $ | (6,152 | ) | $ | 41,781 | |||||
Liability—current period—notable loss events | — | — | — | |||||||||
Liability—current period—non-notable loss events | — | — | — | |||||||||
Liability—change in prior accident years (a) | (1,576 | ) | 1,811 | (3,387 | ) | |||||||
Liability—losses and loss expenses (a) | $ | 34,053 | $ | (4,341 | ) | $ | 38,394 |
(a) | Upon closing the acquisition, an adjustment of $15,995 was made to increase net reserves to reflect fair value. This adjustment was amortized to income through a reduction in losses and loss expenses of $2,968 during the three months ended June 30, 2015, benefiting the loss ratio by 5.5 percentage points. The remaining fair value adjustment of $4,991 was fully amortized during the year ended December 31, 2015. |
Policy Acquisition Costs | ||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||
2016 | Change | 2015 | ||||||||||||||||||
(Dollars in thousands) | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | ||||||||||||||
Property | $ | 3,381 | 23.8 | % | $ | 2,656 | 17.0 | $ | 725 | 6.8 | % | |||||||||
Liability | 12,029 | 23.4 | % | 3,137 | 7.1 | 8,892 | 16.3 | % | ||||||||||||
Total (a) | $ | 15,410 | 23.5 | % | $ | 5,793 | 8.7 | $ | 9,617 | 14.8 | % |
(a) | Upon closing the acquisition, an adjustment of $34,736 was made to reduce deferred acquisition costs to reflect fair value. These deferred acquisition costs would otherwise have been expensed in the amount of $6,584 during the three months ended June 30, 2015 benefiting the policy acquisition cost ratio by 10.1 percentage points. |
Underwriting Income Before General and Administrative and Share Compensation Expenses | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 620 | $ | (1,005 | ) | $ | 1,625 | |||||
Liability | 5,397 | (1,708 | ) | 7,105 | ||||||||
Other insurance related income | 189 | (87 | ) | 276 | ||||||||
Total | $ | 6,206 | $ | (2,800 | ) | $ | 9,006 |
General and Administrative and Share Compensation Expenses | ||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||
2016 | Change | 2015 | ||||||||||||||||||
(Dollars in thousands) | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | ||||||||||||||
General and administrative expenses | $ | 11,458 | 17.4 | % | $ | 2,535 | 3.7 | $ | 8,923 | 13.7 | % | |||||||||
Share compensation expenses | 542 | 0.8 | % | 48 | — | 494 | 0.8 | % | ||||||||||||
Total | $ | 12,000 | 18.2 | % | $ | 2,583 | 3.7 | $ | 9,417 | 14.5 | % |
Three Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Losses and loss expense ratio | 67.4 | % | (4.4 | ) | 71.8 | % | ||
Policy acquisition cost ratio | 23.5 | % | 8.7 | 14.8 | % | |||
General and administrative expense ratio (a) | 18.2 | % | 3.7 | 14.5 | % | |||
Expense ratio | 41.7 | % | 12.4 | 29.3 | % | |||
Combined ratio | 109.1 | % | 8.0 | 101.1 | % |
(a) | The general and administrative expense ratio includes share compensation expenses. |
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Revenues | ||||||||||||
Third party | $ | 3,091 | $ | (1,232 | ) | $ | 4,323 | |||||
Related party | 328 | (806 | ) | 1,134 | ||||||||
Total revenues | 3,419 | (2,038 | ) | 5,457 | ||||||||
Expenses | ||||||||||||
General and administrative expenses | 2,751 | 421 | 2,330 | |||||||||
Share compensation expenses | 133 | (17 | ) | 150 | ||||||||
Finance expenses | 75 | (2,459 | ) | 2,534 | ||||||||
Foreign exchange gains | 4 | (11 | ) | 15 | ||||||||
Total expenses | 2,963 | (2,066 | ) | 5,029 | ||||||||
Income before investments from AlphaCat Funds and Sidecars | $ | 456 | $ | 28 | $ | 428 | ||||||
Investment income from AlphaCat Funds and Sidecars (b) | ||||||||||||
AlphaCat Sidecars | 541 | (732 | ) | 1,273 | ||||||||
AlphaCat ILS Funds - Lower Risk (c) | 2,075 | 181 | 1,894 | |||||||||
AlphaCat ILS Funds - Higher Risk (c) | 692 | (1,684 | ) | 2,376 | ||||||||
BetaCat ILS Funds | 1,113 | 1,053 | 60 | |||||||||
PaCRe | — | (1,738 | ) | 1,738 | ||||||||
Total investment income from AlphaCat Funds and Sidecars | 4,421 | (2,920 | ) | 7,341 | ||||||||
Validus' share of AlphaCat income | $ | 4,877 | $ | (2,892 | ) | $ | 7,769 | |||||
Supplemental information: | ||||||||||||
Gross premiums written | ||||||||||||
AlphaCat Sidecars | $ | (14 | ) | $ | (3,255 | ) | $ | 3,241 | ||||
AlphaCat ILS Funds - Lower Risk (c) | 50,234 | 4,547 | 45,687 | |||||||||
AlphaCat ILS Funds - Higher Risk (c) | 42,010 | 28,143 | 13,867 | |||||||||
AlphaCat Direct (d) | 6,675 | 6,675 | — | |||||||||
Total | $ | 98,905 | $ | 36,110 | $ | 62,795 |
(a) | In presenting the Company’s results, management has included and discussed the results of AlphaCat, which are presented on an asset manager basis. Validus' share of AlphaCat income is a non-GAAP measure and is not calculated under standards or rules that comprise U.S. GAAP. Such measures are referred to as non-GAAP. Non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those determined in accordance with U.S. GAAP. Further discussion of these measures is presented in the section entitled “Non-GAAP Financial Measures.” |
(b) | The investment income from the AlphaCat funds and sidecars is based on equity accounting. |
(c) | Lower risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of less than 7%, whereas higher risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of greater than 7%. Expected loss represents the average annual loss over the set of simulation scenarios divided by the total limit. |
(d) | AlphaCat Direct includes direct investments from third party investors in AlphaCat Re. |
Assets Under Management (a) | ||||||||||||
(Dollars in thousands) | July 1, 2016 | Change | January 1, 2016 | |||||||||
Assets Under Management - Related Party | ||||||||||||
AlphaCat Sidecars | $ | 8,045 | $ | (27,371 | ) | $ | 35,416 | |||||
AlphaCat ILS Funds - Lower Risk (b) | 175,832 | 11,818 | 164,014 | |||||||||
AlphaCat ILS Funds - Higher Risk (b) | 76,287 | 10,823 | 65,464 | |||||||||
AlphaCat Direct (c) | — | — | — | |||||||||
BetaCat ILS Funds | 63,453 | 1,704 | 61,749 | |||||||||
Total | $ | 323,617 | $ | (3,026 | ) | $ | 326,643 | |||||
Assets Under Management - Third Party | ||||||||||||
AlphaCat Sidecars | $ | 30,078 | $ | (124,308 | ) | $ | 154,386 | |||||
AlphaCat ILS Funds - Lower Risk (b) | 1,226,709 | 124,247 | 1,102,462 | |||||||||
AlphaCat ILS Funds - Higher Risk (b) | 564,513 | 129,662 | 434,851 | |||||||||
AlphaCat Direct (c) | 365,558 | (2,262 | ) | 367,820 | ||||||||
BetaCat ILS Funds | — | — | — | |||||||||
Total | 2,186,858 | 127,339 | 2,059,519 | |||||||||
Total Assets Under Management | $ | 2,510,475 | $ | 124,313 | $ | 2,386,162 |
(a) | The Company’s assets under management are based on NAV and are represented by investments made by related parties and third parties in the feeder funds and on a direct basis. |
(b) | Lower risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of less than 7%, whereas higher risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of greater than 7%. Expected loss represents the average annual loss over the set of simulation scenarios divided by the total limit. |
(c) | AlphaCat Direct includes direct investments from third party investors in AlphaCat Re. |
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Investment income | ||||||||||||
Net investment income (a) | $ | 36,849 | $ | 4,995 | $ | 31,854 | ||||||
Operating expenses | ||||||||||||
General and administrative expenses | 17,872 | 780 | 17,092 | |||||||||
Share compensation expenses | 4,007 | 829 | 3,178 | |||||||||
Finance expenses (a) | 13,979 | (1,165 | ) | 15,144 | ||||||||
Tax expense | 1,706 | (843 | ) | 2,549 | ||||||||
Total operating expenses | 37,564 | (399 | ) | 37,963 | ||||||||
Other items | ||||||||||||
Net realized gains on investments (a) | 2,520 | 416 | 2,104 | |||||||||
Change in net unrealized gains (losses) on investments (a) | 30,052 | 63,978 | (33,926 | ) | ||||||||
(Loss) income from investment affiliate | (589 | ) | (873 | ) | 284 | |||||||
Foreign exchange gains (losses) (a) | 6,621 | 9,858 | (3,237 | ) | ||||||||
Other income (loss) | 79 | 687 | (608 | ) | ||||||||
Total other items | 38,683 | 74,066 | (35,383 | ) | ||||||||
Total corporate and investment information | $ | 37,968 | $ | 79,460 | $ | (41,492 | ) |
(a) | These items exclude the components which are included in the Company's share of AlphaCat and amounts which are consolidated from VIEs. |
Net Investment Income | ||||||||||||
Three Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Managed investments | ||||||||||||
Fixed maturities and short-term investments | $ | 30,621 | $ | 1,188 | $ | 29,433 | ||||||
Other investments | 8,026 | 4,012 | 4,014 | |||||||||
Cash and cash equivalents | 380 | (47 | ) | 427 | ||||||||
Securities lending income | 12 | 6 | 6 | |||||||||
Total gross investment income | 39,039 | 5,159 | 33,880 | |||||||||
Investment expenses | (2,190 | ) | (164 | ) | (2,026 | ) | ||||||
Total managed net investment income | $ | 36,849 | $ | 4,995 | $ | 31,854 |
Three Months Ended June 30, | ||||||
U.S. dollar (weakened) strengthened against: | 2016 | 2015 | ||||
British Pound sterling | 7.6 | % | (5.3 | )% | ||
Euro | 2.4 | % | (3.2 | )% | ||
Canadian dollar | (0.3 | )% | (1.3 | )% | ||
Swiss franc | 1.5 | % | (3.6 | )% | ||
Australian dollar | 3.0 | % | (0.9 | )% | ||
New Zealand dollar | (3.1 | )% | 10.3 | % | ||
Singapore dollar | (0.3 | )% | (1.6 | )% | ||
Japanese yen | (8.2 | )% | 2.5 | % | ||
South African rand | — | % | 0.5 | % |
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Underwriting revenues | ||||||||||||
Gross premiums written | $ | 1,936,833 | $ | 91,441 | $ | 1,845,392 | ||||||
Reinsurance premiums ceded | (204,064 | ) | 42,679 | (246,743 | ) | |||||||
Net premiums written | 1,732,769 | 134,120 | 1,598,649 | |||||||||
Change in unearned premiums | (587,778 | ) | (137,707 | ) | (450,071 | ) | ||||||
Net premiums earned | 1,144,991 | (3,587 | ) | 1,148,578 | ||||||||
Other insurance related income | 1,481 | (167 | ) | 1,648 | ||||||||
Total underwriting revenues | 1,146,472 | (3,754 | ) | 1,150,226 | ||||||||
Underwriting deductions | ||||||||||||
Losses and loss expenses | 531,577 | 24,502 | 507,075 | |||||||||
Policy acquisition costs | 215,159 | 12,425 | 202,734 | |||||||||
General and administrative expenses | 175,896 | 7,636 | 168,260 | |||||||||
Share compensation expenses | 21,964 | 3,668 | 18,296 | |||||||||
Total underwriting deductions | 944,596 | 48,231 | 896,365 | |||||||||
Underwriting income (a) | $ | 201,876 | $ | (51,985 | ) | $ | 253,861 | |||||
Net investment income | 68,718 | 4,078 | 64,640 | |||||||||
Finance expenses | (29,369 | ) | 10,280 | (39,649 | ) | |||||||
Dividends on preferred shares | — | — | — | |||||||||
Tax benefit (expense) | 412 | 5,526 | (5,114 | ) | ||||||||
(Loss) income from operating affiliates | (23 | ) | (5,745 | ) | 5,722 | |||||||
(Income) attributable to AlphaCat investors | (10,714 | ) | (10,714 | ) | — | |||||||
Net (income) attributable to noncontrolling interest | (58,622 | ) | (17,753 | ) | (40,869 | ) | ||||||
Net operating income available to Validus common shareholders (a) | $ | 172,278 | $ | (66,313 | ) | $ | 238,591 | |||||
Supplemental information: | ||||||||||||
Losses and loss expenses | ||||||||||||
Current period excluding items below | $ | 562,890 | $ | (50,388 | ) | $ | 613,278 | |||||
Current period—notable loss events | 36,915 | (11,159 | ) | 48,074 | ||||||||
Current period—non-notable loss events | 48,292 | 48,292 | — | |||||||||
Change in prior accident years | (116,520 | ) | 37,757 | (154,277 | ) | |||||||
Total losses and loss expenses | $ | 531,577 | $ | 24,502 | $ | 507,075 | ||||||
Selected ratios: | ||||||||||||
Net premiums written / Gross premiums written | 89.5 | % | 2.9 | 86.6 | % | |||||||
Losses and loss expense ratio | ||||||||||||
Current period excluding items below | 49.2 | % | (4.1 | ) | 53.3 | % | ||||||
Current period—notable loss events | 3.2 | % | (1.0 | ) | 4.2 | % | ||||||
Current period—non-notable loss events | 4.2 | % | 4.2 | — | % | |||||||
Change in prior accident years | (10.2 | )% | 3.2 | (13.4 | )% | |||||||
Losses and loss expenses | 46.4 | % | 2.3 | 44.1 | % | |||||||
Policy acquisition costs | 18.8 | % | 1.1 | 17.7 | % | |||||||
General and administrative expenses (b) | 17.3 | % | 1.1 | 16.2 | % | |||||||
Expense ratio | 36.1 | % | 2.2 | 33.9 | % | |||||||
Combined ratio | 82.5 | % | 4.5 | 78.0 | % |
(a) | Non-GAAP Financial Measures. In presenting the Company’s results, management has included and discussed underwriting income that is not calculated under standards or rules that comprise U.S. GAAP. Such measures are referred to as non-GAAP. Non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those determined in accordance with U.S. GAAP. Further discussion of these measures is presented in the section entitled “Non-GAAP Financial Measures.” |
(b) | The general and administrative expense ratio includes share compensation expenses. |
• | Gross premiums written for the six months ended June 30, 2016 were $1,936.8 million compared to $1,845.4 million for the six months ended June 30, 2015, an increase of $91.4 million, or 5.0%. The increase was primarily driven by an increase in the AlphaCat and Western World segments, partially offset by decreases in the Talbot and Validus Re segments discussed further as follows: |
◦ | Gross premiums written for the six months ended June 30, 2016 in the AlphaCat segment, on behalf of the Company's VIEs, were $266.3 million, compared to $164.6 million for the six months ended June 30, 2015, an increase of $101.7 million or 61.8%, primarily due to an increase in the capital base of the AlphaCat ILS Funds. |
◦ | Gross premiums written for the six months ended June 30, 2016 in the Western World segment were $150.9 million compared to $136.5 million for the six months ended June 30, 2015, an increase of $14.4 million or 10.6%, primarily driven by an increase in the property lines. |
◦ | Gross premiums written for the six months ended June 30, 2016 in the Validus Re segment were $977.5 million compared to $1,009.1 million for the six months ended June 30, 2015, a decrease of $31.6 million or 3.1%. The decrease was primarily attributable to decreases in the property and marine lines as a result of current market conditions and increased cessions to AlphaCat, partially offset by increased specialty business. |
◦ | Gross premiums written for the six months ended June 30, 2016 in the Talbot segment were $562.4 million compared to $563.1 million for the six months ended June 30, 2015, a decrease of $0.7 million or 0.1%. |
• | Underwriting revenues for the six months ended June 30, 2016 were $1,146.5 million compared to $1,150.2 million for the six months ended June 30, 2015, a decrease of $3.8 million or 0.3%. |
• | Losses and loss expenses for the six months ended June 30, 2016 were $531.6 million compared to $507.1 million for the six months ended June 30, 2015, an increase of $24.5 million or 4.8%, primarily as a result of non-notable loss events occurring during the six months ended June 30, 2016. |
• | Gross losses and loss expenses from the Canadian Wildfires notable loss event were $73.5 million for the six months ended June 30, 2016. Net of reinsurance recoveries of $36.6 million, the Company's share of net losses and loss expenses from this event were $36.9 million, or 3.2 percentage points of the loss ratio during the six months ended June 30, 2016. Net of losses of $6.4 million attributable to AlphaCat investors and noncontrolling interest and reinstatement premiums of $3.6 million, the net loss attributable to the Company was $26.9 million. During the six months ended June 30, 2015, the Company incurred a single notable loss event, Pemex, which resulted in an estimated net loss attributable to the Company of $48.1 million, or 4.2 percentage points of the loss ratio. Including reinstatement premiums of $0.4 million, the net loss attributable to the Company was $48.5 million. |
• | Gross losses and loss expenses from the Texas Hailstorms, Kumamoto Earthquake and Jubilee Oil non-notable loss events were $92.5 million for the six months ended June 30, 2016. Net of reinsurance recoveries of $44.2 million, the Company's share of net losses and loss expenses from the non-notable loss events, were $48.3 million, or 4.2 percentage points of the loss ratio. Net of losses of $5.5 million attributable to AlphaCat investors and noncontrolling interest and reinstatement premiums of $9.7 million, the net loss attributable to the Company was $33.1 million. There were no losses and loss expenses from non-notable loss events for the six months ended June 30, 2015. |
• | Loss ratios by line of business were as follows: |
Six Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Property | 31.5 | % | 15.8 | 15.7 | % | |||
Marine | 49.3 | % | (1.1 | ) | 50.4 | % | ||
Specialty | 58.4 | % | (5.1 | ) | 63.5 | % | ||
Liability | 64.1 | % | (9.9 | ) | 74.0 | % | ||
All lines | 46.4 | % | 2.3 | 44.1 | % |
• | The loss ratio for the six months ended June 30, 2016 was 46.4% which included $116.5 million of favorable loss reserve development on prior accident years, benefiting the loss ratio by 10.2 percentage points compared to a loss ratio for the six months ended June 30, 2015 of 44.1% which included $154.3 million of favorable loss reserve development on prior accident years, benefiting the loss ratio by 13.4 percentage points. The favorable development of $116.5 million for the six months ended June 30, 2016 was primarily due to favorable development on non-event reserves of $127.8 million, partially offset by unfavorable development on event reserves of $11.3 million. The term events refers to aggregate notable and non-notable losses incurred. |
• | Combined ratio for the six months ended June 30, 2016 was 82.5% compared to 78.0% for the six months ended June 30, 2015. |
• | Policy acquisition costs for the six months ended June 30, 2016 were $215.2 million compared to $202.7 million for the six months ended June 30, 2015, an increase of $12.4 million or 6.1%, primarily driven by an increase in the Western World segment due to the impact of the acquisition fair value adjustments during the six months ended June 30, 2015. |
• | Underwriting income for the six months ended June 30, 2016 was $201.9 million compared to $253.9 million for the six months ended June 30, 2015, a decrease of $52.0 million or 20.5% primarily as a result of the changes in underwriting revenues and deductions as described above. |
• | Net operating income available to Validus common shareholders for the six months ended June 30, 2016 was $172.3 million compared to $238.6 million for the six months ended June 30, 2015, a decrease of $66.3 million, or 27.8%. |
• | Net income available to Validus common shareholders for the six months ended June 30, 2016 was $261.8 million compared to $239.2 million for the six months ended June 30, 2015, an increase of $22.6 million, or 9.4%. |
• | Annualized return on average equity was 14.2% and annualized net operating return on average equity was 9.3% for the six months ended June 30, 2016 compared to 13.1% and 13.1%, respectively, for the six months ended June 30, 2015. |
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Underwriting revenues | ||||||||||||
Gross premiums written | $ | 977,478 | $ | (31,635 | ) | $ | 1,009,113 | |||||
Reinsurance premiums ceded | (95,691 | ) | 37,464 | (133,155 | ) | |||||||
Net premiums written | 881,787 | 5,829 | 875,958 | |||||||||
Change in unearned premiums | (390,834 | ) | (32,514 | ) | (358,320 | ) | ||||||
Net premiums earned | 490,953 | (26,685 | ) | 517,638 | ||||||||
Other insurance related (loss) income | (165 | ) | (914 | ) | 749 | |||||||
Total underwriting revenues | 490,788 | (27,599 | ) | 518,387 | ||||||||
Underwriting deductions | ||||||||||||
Losses and loss expenses | 215,007 | (21,526 | ) | 236,533 | ||||||||
Policy acquisition costs | 84,823 | (1,097 | ) | 85,920 | ||||||||
General and administrative expenses | 35,051 | (3,239 | ) | 38,290 | ||||||||
Share compensation expenses | 5,676 | 702 | 4,974 | |||||||||
Total underwriting deductions | 340,557 | (25,160 | ) | 365,717 | ||||||||
Underwriting income (a) | $ | 150,231 | $ | (2,439 | ) | $ | 152,670 | |||||
Supplemental information: | ||||||||||||
Losses and loss expenses | ||||||||||||
Current period excluding items below | $ | 221,228 | $ | (35,691 | ) | $ | 256,919 | |||||
Current period—notable loss events | 17,884 | (17,305 | ) | 35,189 | ||||||||
Current period—non-notable loss events | 32,456 | 32,456 | — | |||||||||
Change in prior accident years | (56,561 | ) | (986 | ) | (55,575 | ) | ||||||
Total losses and loss expenses | $ | 215,007 | $ | (21,526 | ) | $ | 236,533 | |||||
Selected ratios: | ||||||||||||
Net premiums written / Gross premiums written | 90.2 | % | 3.4 | 86.8 | % | |||||||
Losses and loss expense ratio | ||||||||||||
Current period excluding items below | 45.1 | % | (4.5 | ) | 49.6 | % | ||||||
Current period—notable loss events | 3.6 | % | (3.2 | ) | 6.8 | % | ||||||
Current period—non-notable loss events | 6.6 | % | 6.6 | — | % | |||||||
Change in prior accident years | (11.5 | )% | (0.8 | ) | (10.7 | )% | ||||||
Losses and loss expenses | 43.8 | % | (1.9 | ) | 45.7 | % | ||||||
Policy acquisition costs | 17.3 | % | 0.7 | 16.6 | % | |||||||
General and administrative expenses (b) | 8.3 | % | (0.1 | ) | 8.4 | % | ||||||
Expense ratio | 25.6 | % | 0.6 | 25.0 | % | |||||||
Combined ratio | 69.4 | % | (1.3 | ) | 70.7 | % |
(a) | Non-GAAP Financial Measures. In presenting the Company’s results, management has included and discussed underwriting income that is not calculated under standards or rules that comprise U.S. GAAP. Such measures are referred to as non-GAAP. Non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those determined in accordance with U.S. GAAP. Further discussion of these measures is presented in the section entitled “Non-GAAP Financial Measures.” |
(b) | The general and administrative expense ratio includes share compensation expenses. |
Business Mix - Ratio of Gross Premiums Written by Line of Business to Total Gross Premiums Written | |||||||||||||||||||||
Six Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | |||||||||||||||
Property | $ | 408,671 | 41.8 | % | $ | (57,781 | ) | (4.4 | ) | $ | 466,452 | 46.2 | % | ||||||||
Marine | 114,409 | 11.7 | % | (25,536 | ) | (2.2 | ) | 139,945 | 13.9 | % | |||||||||||
Specialty | 454,398 | 46.5 | % | 51,682 | 6.6 | 402,716 | 39.9 | % | |||||||||||||
Total | $ | 977,478 | 100.0 | % | $ | (31,635 | ) | $ | 1,009,113 | 100.0 | % |
Reinsurance Premiums Ceded | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 81,388 | $ | (33,711 | ) | $ | 115,099 | |||||
Marine | 6,547 | (218 | ) | 6,765 | ||||||||
Specialty | 7,756 | (3,535 | ) | 11,291 | ||||||||
Total | $ | 95,691 | $ | (37,464 | ) | $ | 133,155 |
Net Retention - Ratio of Net Premiums Written to Gross Premiums Written | |||||||||||||||||||||
Six Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | |||||||||||||||
Property | $ | 327,283 | 80.1 | % | $ | (24,070 | ) | 4.8 | $ | 351,353 | 75.3 | % | |||||||||
Marine | 107,862 | 94.3 | % | (25,318 | ) | (0.9 | ) | 133,180 | 95.2 | % | |||||||||||
Specialty | 446,642 | 98.3 | % | 55,217 | 1.1 | 391,425 | 97.2 | % | |||||||||||||
Total | $ | 881,787 | 90.2 | % | $ | 5,829 | 3.4 | $ | 875,958 | 86.8 | % |
Net Premiums Earned | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 207,380 | $ | (10,150 | ) | $ | 217,530 | |||||
Marine | 65,968 | (16,679 | ) | 82,647 | ||||||||
Specialty | 217,605 | 144 | 217,461 | |||||||||
Total | $ | 490,953 | $ | (26,685 | ) | $ | 517,638 |
Losses and Loss Expense Ratio - All Lines | ||||||||
Six Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
All lines—current period excluding items below | 45.1 | % | (4.5 | ) | 49.6 | % | ||
All lines—current period—notable loss events | 3.6 | % | (3.2 | ) | 6.8 | % | ||
All lines—current period—non-notable loss events | 6.6 | % | 6.6 | 0.0 | % | |||
All lines—change in prior accident years | (11.5 | )% | (0.8 | ) | (10.7 | )% | ||
All lines—loss ratio | 43.8 | % | (1.9 | ) | 45.7 | % |
Losses and Loss Expenses - All Lines | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
All lines—current period excluding items below | $ | 221,228 | $ | (35,691 | ) | $ | 256,919 | |||||
All lines—current period—notable loss events | 17,884 | (17,305 | ) | 35,189 | ||||||||
All lines—current period—non-notable loss events | 32,456 | 32,456 | — | |||||||||
All lines—change in prior accident years | (56,561 | ) | (986 | ) | (55,575 | ) | ||||||
All lines—losses and loss expenses | $ | 215,007 | $ | (21,526 | ) | $ | 236,533 |
Losses and Loss Expense Ratio - Property Lines | ||||||||
Six Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Property—current period excluding items below | 19.8 | % | (3.0 | ) | 22.8 | % | ||
Property—current period—notable loss events | 8.6 | % | 8.6 | 0.0 | % | |||
Property—current period—non-notable loss events | 10.6 | % | 10.6 | 0.0 | % | |||
Property—change in prior accident years | (15.6 | )% | (1.4 | ) | (14.2 | )% | ||
Property—loss ratio | 23.4 | % | 14.8 | 8.6 | % |
Losses and Loss Expenses - Property Lines | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property—current period excluding items below | $ | 40,951 | $ | (8,577 | ) | $ | 49,528 | |||||
Property—current period—notable loss events | 17,884 | 17,884 | — | |||||||||
Property—current period—non-notable loss events | 22,079 | 22,079 | — | |||||||||
Property—change in prior accident years | (32,300 | ) | (1,476 | ) | (30,824 | ) | ||||||
Property—losses and loss expenses | $ | 48,614 | $ | 29,910 | $ | 18,704 |
Losses and Loss Expense Ratio - Marine Lines | ||||||||
Six Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Marine—current period excluding items below | 50.2 | % | (5.8 | ) | 56.0 | % | ||
Marine—current period—notable loss events | 0.0 | % | (40.6 | ) | 40.6 | % | ||
Marine—current period—non-notable loss events | 1.0 | % | 1.0 | 0.0 | % | |||
Marine—change in prior accident years | (9.8 | )% | 9.2 | (19.0 | )% | |||
Marine—loss ratio | 41.4 | % | (36.2 | ) | 77.6 | % |
Losses and Loss Expenses - Marine Lines | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Marine—current period excluding items below | $ | 33,125 | $ | (13,147 | ) | $ | 46,272 | |||||
Marine—current period—notable loss events | — | (33,524 | ) | 33,524 | ||||||||
Marine—current period—non-notable loss events | 670 | 670 | — | |||||||||
Marine—change in prior accident years | (6,463 | ) | 9,206 | (15,669 | ) | |||||||
Marine—losses and loss expenses | $ | 27,332 | $ | (36,795 | ) | $ | 64,127 |
Losses and Loss Expense Ratio - Specialty Lines | ||||||||
Six Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Specialty—current period excluding items below | 67.6 | % | (6.5 | ) | 74.1 | % | ||
Specialty—current period—notable loss events | 0.0 | % | (0.8 | ) | 0.8 | % | ||
Specialty—current period—non-notable loss events | 4.5 | % | 4.5 | 0.0 | % | |||
Specialty—change in prior accident years | (8.2 | )% | (4.0 | ) | (4.2 | )% | ||
Specialty—loss ratio | 63.9 | % | (6.8 | ) | 70.7 | % |
Losses and Loss Expenses - Specialty Lines | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Specialty—current period excluding items below | $ | 147,152 | $ | (13,967 | ) | $ | 161,119 | |||||
Specialty—current period—notable loss events | — | (1,665 | ) | 1,665 | ||||||||
Specialty—current period—non-notable loss events | 9,707 | 9,707 | — | |||||||||
Specialty—change in prior accident years | (17,798 | ) | (8,716 | ) | (9,082 | ) | ||||||
Specialty—losses and loss expenses | $ | 139,061 | $ | (14,641 | ) | $ | 153,702 |
Policy Acquisition Costs | |||||||||||||||||||||
Six Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | |||||||||||||||
Property | $ | 37,213 | 17.9 | % | $ | 537 | 1.0 | $ | 36,676 | 16.9 | % | ||||||||||
Marine | 10,193 | 15.5 | % | (5,413 | ) | (3.4 | ) | 15,606 | 18.9 | % | |||||||||||
Specialty | 37,417 | 17.2 | % | 3,779 | 1.7 | 33,638 | 15.5 | % | |||||||||||||
Total | $ | 84,823 | 17.3 | % | $ | (1,097 | ) | 0.7 | $ | 85,920 | 16.6 | % |
Underwriting Income Before General and Administrative and Share Compensation Expenses | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 121,553 | $ | (40,597 | ) | $ | 162,150 | |||||
Marine | 28,443 | 25,529 | 2,914 | |||||||||
Specialty | 41,127 | 11,006 | 30,121 | |||||||||
Other insurance related (loss) income | (165 | ) | (914 | ) | 749 | |||||||
Total | $ | 190,958 | $ | (4,976 | ) | $ | 195,934 |
General and Administrative and Share Compensation Expenses | |||||||||||||||||||||
Six Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | |||||||||||||||
General and administrative expenses | $ | 35,051 | 7.1 | % | $ | (3,239 | ) | (0.3 | ) | $ | 38,290 | 7.4 | % | ||||||||
Share compensation expenses | 5,676 | 1.2 | % | 702 | 0.2 | 4,974 | 1.0 | % | |||||||||||||
Total | $ | 40,727 | 8.3 | % | $ | (2,537 | ) | (0.1 | ) | $ | 43,264 | 8.4 | % |
Select Underwriting Ratios | ||||||||
Six Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Losses and loss expense ratio | 43.8 | % | (1.9 | ) | 45.7 | % | ||
Policy acquisition cost ratio | 17.3 | % | 0.7 | 16.6 | % | |||
General and administrative expense ratio (a) | 8.3 | % | (0.1 | ) | 8.4 | % | ||
Expense ratio | 25.6 | % | 0.6 | 25.0 | % | |||
Combined ratio | 69.4 | % | (1.3 | ) | 70.7 | % |
(a) | The general and administrative expense ratio includes share compensation expenses. |
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Underwriting revenues | ||||||||||||
Gross premiums written | $ | 562,384 | $ | (739 | ) | $ | 563,123 | |||||
Reinsurance premiums ceded | (114,619 | ) | 13,702 | (128,321 | ) | |||||||
Net premiums written | 447,765 | 12,963 | 434,802 | |||||||||
Change in unearned premiums | (39,424 | ) | (32,649 | ) | (6,775 | ) | ||||||
Net premiums earned | 408,341 | (19,686 | ) | 428,027 | ||||||||
Other insurance related income | 290 | 196 | 94 | |||||||||
Total underwriting revenues | 408,631 | (19,490 | ) | 428,121 | ||||||||
Underwriting deductions | ||||||||||||
Losses and loss expenses | 209,411 | 35,313 | 174,098 | |||||||||
Policy acquisition costs | 87,956 | (8,807 | ) | 96,763 | ||||||||
General and administrative expenses | 77,596 | 5,547 | 72,049 | |||||||||
Share compensation expenses | 6,792 | 811 | 5,981 | |||||||||
Total underwriting deductions | 381,755 | 32,864 | 348,891 | |||||||||
Underwriting income (a) | $ | 26,876 | $ | (52,354 | ) | $ | 79,230 | |||||
Supplemental information: | ||||||||||||
Losses and loss expenses | ||||||||||||
Current period excluding items below | $ | 239,645 | $ | (8,841 | ) | $ | 248,486 | |||||
Current period—notable loss events | 11,703 | (1,182 | ) | 12,885 | ||||||||
Current period—non-notable loss events | 9,111 | 9,111 | — | |||||||||
Change in prior accident years | (51,048 | ) | 36,225 | (87,273 | ) | |||||||
Total losses and loss expenses | $ | 209,411 | $ | 35,313 | $ | 174,098 | ||||||
Selected ratios: | ||||||||||||
Net premiums written / Gross premiums written | 79.6 | % | 2.4 | 77.2 | % | |||||||
Losses and loss expense ratio | ||||||||||||
Current period excluding items below | 58.7 | % | 0.6 | 58.1 | % | |||||||
Current period—notable loss events | 2.9 | % | (0.1 | ) | 3.0 | % | ||||||
Current period—non-notable loss events | 2.2 | % | 2.2 | — | % | |||||||
Change in prior accident years | (12.5 | )% | 7.9 | (20.4 | )% | |||||||
Losses and loss expenses | 51.3 | % | 10.6 | 40.7 | % | |||||||
Policy acquisition costs | 21.5 | % | (1.1 | ) | 22.6 | % | ||||||
General and administrative expenses (b) | 20.7 | % | 2.5 | 18.2 | % | |||||||
Expense ratio | 42.2 | % | 1.4 | 40.8 | % | |||||||
Combined ratio | 93.5 | % | 12.0 | 81.5 | % |
(a) | Non-GAAP Financial Measures. In presenting the Company’s results, management has included and discussed underwriting income that is not calculated under standards or rules that comprise U.S. GAAP. Such measures are referred to as non-GAAP. Non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those determined in accordance with U.S. GAAP. Further discussion of these measures is presented in the section entitled “Non-GAAP Financial Measures.” |
(b) | The general and administrative expense ratio includes share compensation expenses. |
Business Mix - Ratio of Gross Premiums Written by Line of Business to Total Gross Premiums Written | |||||||||||||||||||||
Six Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | |||||||||||||||
Property | $ | 181,413 | 32.2 | % | $ | 934 | 0.1 | $ | 180,479 | 32.1 | % | ||||||||||
Marine | 174,212 | 31.0 | % | (25,866 | ) | (4.5 | ) | 200,078 | 35.5 | % | |||||||||||
Specialty | 206,759 | 36.8 | % | 24,193 | 4.4 | 182,566 | 32.4 | % | |||||||||||||
Total | $ | 562,384 | 100.0 | % | $ | (739 | ) | $ | 563,123 | 100.0 | % |
Reinsurance Premiums Ceded | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 53,789 | $ | (8,788 | ) | $ | 62,577 | |||||
Marine | 26,101 | (2,577 | ) | 28,678 | ||||||||
Specialty | 34,729 | (2,337 | ) | 37,066 | ||||||||
Total | $ | 114,619 | $ | (13,702 | ) | $ | 128,321 |
Net Retention - Ratio of Net Premiums Written to Gross Premiums Written | |||||||||||||||||||||
Six Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | |||||||||||||||
Property | $ | 127,624 | 70.3 | % | $ | 9,722 | 5.0 | $ | 117,902 | 65.3 | % | ||||||||||
Marine | 148,111 | 85.0 | % | (23,289 | ) | (0.7 | ) | 171,400 | 85.7 | % | |||||||||||
Specialty | 172,030 | 83.2 | % | 26,530 | 3.5 | 145,500 | 79.7 | % | |||||||||||||
Total | $ | 447,765 | 79.6 | % | $ | 12,963 | 2.4 | $ | 434,802 | 77.2 | % |
Net Premiums Earned | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 115,855 | $ | 4,712 | $ | 111,143 | ||||||
Marine | 143,793 | (26,260 | ) | 170,053 | ||||||||
Specialty | 148,693 | 1,862 | 146,831 | |||||||||
Total | $ | 408,341 | $ | (19,686 | ) | $ | 428,027 |
Losses and Loss Expense Ratio - All Lines | |||||||||
Six Months Ended June 30, | |||||||||
2016 | Change | 2015 | |||||||
All lines—current period excluding items below | 58.7 | % | 0.6 | 58.1 | % | ||||
All lines—current period—notable loss events | 2.9 | % | (0.1 | ) | 3.0 | % | |||
All lines—current period—non-notable loss events | 2.2 | % | 2.2 | 0.0 | % | ||||
All lines—change in prior accident years | (12.5 | )% | 7.9 | (20.4 | )% | ||||
All lines—loss ratio | 51.3 | % | 10.6 | 40.7 | % |
Losses and Loss Expenses - All Lines | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
All lines—current period excluding items below | $ | 239,645 | $ | (8,841 | ) | $ | 248,486 | |||||
All lines—current period—notable loss events | 11,703 | (1,182 | ) | 12,885 | ||||||||
All lines—current period—non-notable loss events | 9,111 | 9,111 | — | |||||||||
All lines—change in prior accident years | (51,048 | ) | 36,225 | (87,273 | ) | |||||||
All lines—losses and loss expenses | $ | 209,411 | $ | 35,313 | $ | 174,098 |
Losses and Loss Expense Ratio - Property Lines | |||||||||
Six Months Ended June 30, | |||||||||
2016 | Change | 2015 | |||||||
Property—current period excluding items below | 59.4 | % | (3.7 | ) | 63.1 | % | |||
Property—current period—notable loss events | 10.1 | % | 9.7 | 0.4 | % | ||||
Property—current period—non-notable loss events | 3.7 | % | 3.7 | 0.0 | % | ||||
Property—change in prior accident years | (24.6 | )% | 9.1 | (33.7 | )% | ||||
Property—loss ratio | 48.6 | % | 18.8 | 29.8 | % |
Losses and Loss Expenses - Property Lines | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property—current period excluding items below | $ | 68,874 | $ | (1,306 | ) | $ | 70,180 | |||||
Property—current period—notable loss events | 11,703 | 11,277 | 426 | |||||||||
Property—current period—non-notable loss events | 4,274 | 4,274 | — | |||||||||
Property—change in prior accident years | (28,540 | ) | 8,895 | (37,435 | ) | |||||||
Property—losses and loss expenses | $ | 56,311 | $ | 23,140 | $ | 33,171 |
Losses and Loss Expense Ratio - Marine Lines | |||||||||
Six Months Ended June 30, | |||||||||
2016 | Change | 2015 | |||||||
Marine—current period excluding items below | 53.6 | % | 2.4 | 51.2 | % | ||||
Marine—current period—notable loss events | 0.0 | % | (7.3 | ) | 7.3 | % | |||
Marine—current period—non-notable loss events | 3.4 | % | 3.4 | 0.0 | % | ||||
Marine—change in prior accident years | (4.1 | )% | 17.3 | (21.4 | )% | ||||
Marine—loss ratio | 52.9 | % | 15.8 | 37.1 | % |
Losses and Loss Expenses - Marine Lines | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Marine—current period excluding items below | $ | 77,156 | $ | (9,831 | ) | $ | 86,987 | |||||
Marine—current period—notable loss events | — | (12,459 | ) | 12,459 | ||||||||
Marine—current period—non-notable loss events | 4,837 | 4,837 | — | |||||||||
Marine—change in prior accident years | (5,964 | ) | 30,360 | (36,324 | ) | |||||||
Marine—losses and loss expenses | $ | 76,029 | $ | 12,907 | $ | 63,122 |
Losses and Loss Expense Ratio - Specialty Lines | |||||||||
Six Months Ended June 30, | |||||||||
2016 | Change | 2015 | |||||||
Specialty—current period excluding items below | 62.9 | % | 0.7 | 62.2 | % | ||||
Specialty—current period—notable loss events | 0.0 | % | 0.0 | 0.0 | % | ||||
Specialty—current period—non-notable loss events | 0.0 | % | 0.0 | 0.0 | % | ||||
Specialty—change in prior accident years | (11.1 | )% | (1.9 | ) | (9.2 | )% | |||
Specialty—loss ratio | 51.8 | % | (1.2 | ) | 53.0 | % |
Losses and Loss Expenses - Specialty Lines | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Specialty—current period excluding items above | $ | 93,615 | $ | 2,296 | $ | 91,319 | ||||||
Specialty—current period—notable loss events | — | — | — | |||||||||
Specialty—current period—non-notable loss events | — | — | — | |||||||||
Specialty—change in prior accident years | (16,544 | ) | (3,030 | ) | (13,514 | ) | ||||||
Specialty—losses and loss expenses | $ | 77,071 | $ | (734 | ) | $ | 77,805 |
Policy Acquisition Costs | |||||||||||||||||||||
Six Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | |||||||||||||||
Property | $ | 17,474 | 15.1 | % | $ | 1,385 | 0.6 | $ | 16,089 | 14.5 | % | ||||||||||
Marine | 36,097 | 25.1 | % | (9,392 | ) | (1.6 | ) | 45,489 | 26.7 | % | |||||||||||
Specialty | 34,385 | 23.1 | % | (800 | ) | (0.9 | ) | 35,185 | 24.0 | % | |||||||||||
Total | $ | 87,956 | 21.5 | % | $ | (8,807 | ) | (1.1 | ) | $ | 96,763 | 22.6 | % |
Underwriting Income Before General and Administrative and Share Compensation Expenses | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 42,070 | $ | (19,813 | ) | $ | 61,883 | |||||
Marine | 31,667 | (29,775 | ) | 61,442 | ||||||||
Specialty | 37,237 | 3,396 | 33,841 | |||||||||
Other insurance related income | 290 | 196 | 94 | |||||||||
Total | $ | 111,264 | $ | (45,996 | ) | $ | 157,260 |
General and Administrative and Share Compensation Expenses | ||||||||||||||||||||
Six Months Ended June 30, | ||||||||||||||||||||
2016 | Change | 2015 | ||||||||||||||||||
(Dollars in thousands) | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | ||||||||||||||
General and administrative expenses | $ | 77,596 | 19.0 | % | $ | 5,547 | 2.2 | $ | 72,049 | 16.8 | % | |||||||||
Share compensation expenses | 6,792 | 1.7 | % | 811 | 0.3 | 5,981 | 1.4 | % | ||||||||||||
Total | $ | 84,388 | 20.7 | % | $ | 6,358 | 2.5 | $ | 78,030 | 18.2 | % |
Select Underwriting Ratios | |||||||||
Six Months Ended June 30, | |||||||||
2016 | Change | 2015 | |||||||
Losses and loss expense ratio | 51.3 | % | 10.6 | 40.7 | % | ||||
Policy acquisition cost ratio | 21.5 | % | (1.1 | ) | 22.6 | % | |||
General and administrative expense ratio (a) | 20.7 | % | 2.5 | 18.2 | % | ||||
Expense ratio | 42.2 | % | 1.4 | 40.8 | % | ||||
Combined ratio | 93.5 | % | 12.0 | 81.5 | % |
(a) | The general and administrative expense ratio includes share compensation expenses. |
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Underwriting revenues | ||||||||||||
Gross premiums written | $ | 150,930 | $ | 14,429 | $ | 136,501 | ||||||
Reinsurance premiums ceded | (9,145 | ) | (471 | ) | (8,674 | ) | ||||||
Net premiums written | 141,785 | 13,958 | 127,827 | |||||||||
Change in unearned premiums | (14,630 | ) | (19,803 | ) | 5,173 | |||||||
Net premiums earned | 127,155 | (5,845 | ) | 133,000 | ||||||||
Other insurance related income | 477 | (62 | ) | 539 | ||||||||
Total underwriting revenues | 127,632 | (5,907 | ) | 133,539 | ||||||||
Underwriting deductions | ||||||||||||
Losses and loss expenses | 83,875 | (13,413 | ) | 97,288 | ||||||||
Policy acquisition costs | 29,610 | 15,714 | 13,896 | |||||||||
General and administrative expenses | 23,533 | 3,983 | 19,550 | |||||||||
Share compensation expenses | 1,123 | 152 | 971 | |||||||||
Total underwriting deductions | 138,141 | 6,436 | 131,705 | |||||||||
Underwriting (loss) income (a) | $ | (10,509 | ) | $ | (12,343 | ) | $ | 1,834 | ||||
Supplemental information: | ||||||||||||
Losses and loss expenses | ||||||||||||
Current period excluding items below | $ | 90,834 | $ | (17,039 | ) | $ | 107,873 | |||||
Current period—notable loss events | — | — | — | |||||||||
Current period—non-notable loss events | 625 | 625 | — | |||||||||
Change in prior accident years | (7,584 | ) | 3,001 | (10,585 | ) | |||||||
Total losses and loss expenses | $ | 83,875 | $ | (13,413 | ) | $ | 97,288 | |||||
Selected ratios: | ||||||||||||
Net premiums written / Gross premiums written | 93.9 | % | 0.3 | 93.6 | % | |||||||
Losses and loss expense ratio | ||||||||||||
Current period excluding items below | 71.5 | % | (9.6 | ) | 81.1 | % | ||||||
Current period—notable loss events | — | % | — | — | % | |||||||
Current period—non-notable loss events | 0.5 | % | 0.5 | — | % | |||||||
Change in prior accident years | (6.0 | )% | 2.0 | (8.0 | )% | |||||||
Losses and loss expenses | 66.0 | % | (7.1 | ) | 73.1 | % | ||||||
Policy acquisition costs | 23.3 | % | 12.8 | 10.5 | % | |||||||
General and administrative expense (b) | 19.3 | % | 3.9 | 15.4 | % | |||||||
Expense ratio | 42.6 | % | 16.7 | 25.9 | % | |||||||
Combined ratio | 108.6 | % | 9.6 | 99.0 | % |
(a) | Non-GAAP Financial Measures. In presenting the Company’s results, management has included and discussed underwriting income that is not calculated under standards or rules that comprise U.S. GAAP. Such measures are referred to as non-GAAP. Non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those determined in accordance with U.S. GAAP. Further discussion of these measures is presented in the section entitled “Non-GAAP Financial Measures.” |
(b) | The general and administrative expense ratio includes share compensation expenses. |
Business Mix - Ratio of Gross Premiums Written by Line of Business to Total Gross Premiums Written | |||||||||||||||||||||
Six Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | Gross Premiums Written | % of Total | |||||||||||||||
Property | $ | 41,644 | 27.6 | % | $ | 16,372 | 9.1 | $ | 25,272 | 18.5 | % | ||||||||||
Liability | 109,286 | 72.4 | % | (1,943 | ) | (9.1 | ) | 111,229 | 81.5 | % | |||||||||||
Total | $ | 150,930 | 100.0 | % | $ | 14,429 | $ | 136,501 | 100.0 | % |
Reinsurance Premiums Ceded | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 3,707 | $ | 1,770 | $ | 1,937 | ||||||
Liability | 5,438 | (1,299 | ) | 6,737 | ||||||||
Total | $ | 9,145 | $ | 471 | $ | 8,674 |
Net Retention - Ratio of Net Premiums Written to Gross Premiums Written | |||||||||||||||||||||
Six Months Ended June 30, | |||||||||||||||||||||
2016 | Change | 2015 | |||||||||||||||||||
(Dollars in thousands) | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | Net Premiums Written | % of Gross Premiums Written | |||||||||||||||
Property | $ | 37,937 | 91.1 | % | $ | 14,602 | (1.2 | ) | $ | 23,335 | 92.3 | % | |||||||||
Liability | 103,848 | 95.0 | % | (644 | ) | 1.1 | 104,492 | 93.9 | % | ||||||||||||
Total | $ | 141,785 | 93.9 | % | $ | 13,958 | 0.3 | $ | 127,827 | 93.6 | % |
Net Premiums Earned | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 26,372 | $ | 4,950 | $ | 21,422 | ||||||
Liability | 100,783 | (10,795 | ) | 111,578 | ||||||||
Total | $ | 127,155 | $ | (5,845 | ) | $ | 133,000 |
Losses and Loss Expense Ratio - All Lines | |||||||||
Six Months Ended June 30, | |||||||||
2016 | Change | 2015 | |||||||
All lines—current period excluding items below | 71.5 | % | (9.6 | ) | 81.1 | % | |||
All lines—current period—notable loss events | 0.0 | % | 0.0 | 0.0 | % | ||||
All lines—current period—non-notable loss events | 0.5 | % | 0.5 | 0.0 | % | ||||
All lines—change in prior accident years (a) | (6.0 | )% | 2.0 | (8.0 | )% | ||||
All lines—loss ratio (a) | 66.0 | % | (7.1 | ) | 73.1 | % |
Losses and Loss Expenses - All Lines | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
All lines—current period excluding items below | $ | 90,834 | $ | (17,039 | ) | $ | 107,873 | |||||
All lines—current period—notable loss events | — | — | — | |||||||||
All lines—current period—non-notable loss events | 625 | 625 | — | |||||||||
All lines—change in prior accident years (a) | (7,584 | ) | 3,001 | (10,585 | ) | |||||||
All lines—losses and loss expenses (a) | $ | 83,875 | $ | (13,413 | ) | $ | 97,288 |
(a) | Upon closing the acquisition, an adjustment of $15,586 was made to increase net reserves to reflect fair value. This adjustment was amortized to income through a reduction in losses and loss expenses of $6,115 during the six months ended June 30, 2015, benefiting the loss ratio by 4.6 percentage points. The remaining fair value adjustment of $4,864 was fully amortized during the year ended December 31, 2015. |
Losses and Loss Expense Ratio - Property Lines | |||||||||
Six Months Ended June 30, | |||||||||
2016 | Change | 2015 | |||||||
Property—current period excluding items below | 78.2 | % | (7.3 | ) | 85.5 | % | |||
Property—current period—notable loss events | 0.0 | % | 0.0 | 0.0 | % | ||||
Property—current period—non-notable loss events | 2.4 | % | 2.4 | 0.0 | % | ||||
Property—change in prior accident years (a) | (7.7 | )% | 9.1 | (16.8 | )% | ||||
Property—loss ratio (a) | 72.9 | % | 4.2 | 68.7 | % |
Losses and Loss Expenses - Property Lines | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property—current period excluding items below | $ | 20,629 | $ | 2,316 | $ | 18,313 | ||||||
Property—current period—notable loss events | — | — | — | |||||||||
Property—current period—non-notable loss events | 625 | 625 | — | |||||||||
Property—change in prior accident years (a) | (2,023 | ) | 1,571 | (3,594 | ) | |||||||
Property—losses and loss expenses (a) | $ | 19,231 | $ | 4,512 | $ | 14,719 |
(a) | Upon closing the acquisition, an adjustment of $409 was made to decrease net reserves to reflect fair value. This adjustment was amortized to income through an increase in losses and loss expenses of $161 during the six months ended June 30, 2015, increasing the loss ratio by 0.8 percentage points. The remaining fair value adjustment of $127 was fully amortized during the year ended December 31, 2015. |
Losses and Loss Expense Ratio - Liability Lines | |||||||||
Six Months Ended June 30, | |||||||||
2016 | Change | 2015 | |||||||
Liability—current period excluding items below | 69.6 | % | (10.7 | ) | 80.3 | % | |||
Liability—current period—notable loss events | 0.0 | % | 0.0 | 0.0 | % | ||||
Liability—current period—non-notable loss events | 0.0 | % | 0.0 | 0.0 | % | ||||
Liability—change in prior accident years (a) | (5.5 | )% | 0.8 | (6.3 | )% | ||||
Liability—loss ratio (a) | 64.1 | % | (9.9 | ) | 74.0 | % |
Losses and Loss Expenses - Liability Lines | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Liability—current period excluding items above | $ | 70,205 | $ | (19,355 | ) | $ | 89,560 | |||||
Liability—current period—notable loss events | — | — | — | |||||||||
Liability—current period—non-notable loss events | — | — | — | |||||||||
Liability—change in prior accident years (a) | (5,561 | ) | 1,430 | (6,991 | ) | |||||||
Liability—losses and loss expenses (a) | $ | 64,644 | $ | (17,925 | ) | $ | 82,569 |
(a) | Upon closing the acquisition, an adjustment of $15,995 was made to increase net reserves to reflect fair value. This adjustment was amortized to income through a reduction in losses and loss expenses of $6,276 during the six months ended June 30, 2015, benefiting the loss ratio by 5.6 percentage points. The remaining fair value adjustment of $4,991 was fully amortized during the year ended December 31, 2015. |
Policy Acquisition Costs | ||||||||||||||||||||
Six Months Ended June 30, | ||||||||||||||||||||
2016 | Change | 2015 | ||||||||||||||||||
(Dollars in thousands) | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | Policy Acquisition Costs | % of Net Premiums Earned | ||||||||||||||
Property | $ | 6,283 | 23.8 | % | $ | 4,734 | 16.6 | $ | 1,549 | 7.2 | % | |||||||||
Liability | 23,327 | 23.1 | % | 10,980 | 12.0 | 12,347 | 11.1 | % | ||||||||||||
Total (a) | $ | 29,610 | 23.3 | % | $ | 15,714 | 12.8 | $ | 13,896 | 10.5 | % |
(a) | Upon closing the acquisition, an adjustment of $34,736 was made to reduce deferred acquisition costs to reflect fair value. These deferred acquisition costs would otherwise have been expensed in the amount of $16,992 during the six months ended June 30, 2015, benefiting the policy acquisition cost ratio by 12.8 percentage points. |
Underwriting Income Before General and Administrative and Share Compensation Expenses | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Property | $ | 858 | $ | (4,296 | ) | $ | 5,154 | |||||
Liability | 12,812 | (3,850 | ) | 16,662 | ||||||||
Other insurance related income | 477 | (62 | ) | 539 | ||||||||
Total | $ | 14,147 | $ | (8,208 | ) | $ | 22,355 |
General and Administrative and Share Compensation Expenses | ||||||||||||||||||||
Six Months Ended June 30, | ||||||||||||||||||||
2016 | Change | 2015 | ||||||||||||||||||
(Dollars in thousands) | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | Expenses | % of Net Premiums Earned | ||||||||||||||
General and administrative expenses | $ | 23,533 | 18.4 | % | $ | 3,983 | 3.7 | $ | 19,550 | 14.7 | % | |||||||||
Share compensation expenses | 1,123 | 0.9 | % | 152 | 0.2 | 971 | 0.7 | % | ||||||||||||
Total | $ | 24,656 | 19.3 | % | $ | 4,135 | 3.9 | $ | 20,521 | 15.4 | % |
Six Months Ended June 30, | ||||||||
2016 | Change | 2015 | ||||||
Losses and loss expense ratio | 66.0 | % | (7.1 | ) | 73.1 | % | ||
Policy acquisition cost ratio | 23.3 | % | 12.8 | 10.5 | % | |||
General and administrative expense ratio (a) | 19.3 | % | 3.9 | 15.4 | % | |||
Expense ratio | 42.6 | % | 16.7 | 25.9 | % | |||
Combined ratio | 108.6 | % | 9.6 | 99.0 | % |
(a) | The general and administrative expense ratio includes share compensation expenses. |
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Revenues | ||||||||||||
Third party | $ | 7,818 | $ | (1,042 | ) | $ | 8,860 | |||||
Related party | 1,219 | (1,101 | ) | 2,320 | ||||||||
Total revenues | 9,037 | (2,143 | ) | 11,180 | ||||||||
Expenses | ||||||||||||
General and administrative expenses | 4,233 | (526 | ) | 4,759 | ||||||||
Share compensation expenses | 274 | (25 | ) | 299 | ||||||||
Finance expenses | 883 | (6,079 | ) | 6,962 | ||||||||
Foreign exchange gains | 12 | 10 | 2 | |||||||||
Total expenses | 5,402 | (6,620 | ) | 12,022 | ||||||||
Income (loss) before investments from AlphaCat Funds and Sidecars | $ | 3,635 | $ | 4,477 | $ | (842 | ) | |||||
Investment income (loss) from AlphaCat Funds and Sidecars (b) | ||||||||||||
AlphaCat Sidecars | 665 | (1,776 | ) | 2,441 | ||||||||
AlphaCat ILS Funds - Lower Risk (c) | 4,582 | 1,402 | 3,180 | |||||||||
AlphaCat ILS Funds - Higher Risk (c) | 3,128 | (1,673 | ) | 4,801 | ||||||||
BetaCat ILS Funds | 1,676 | 1,442 | 234 | |||||||||
PaCRe | (23 | ) | (5,745 | ) | 5,722 | |||||||
Total investment income from AlphaCat Funds and Sidecars | 10,028 | (6,350 | ) | 16,378 | ||||||||
Validus' share of AlphaCat income | $ | 13,663 | $ | (1,873 | ) | $ | 15,536 | |||||
Supplemental information: | ||||||||||||
Gross premiums written | ||||||||||||
AlphaCat Sidecars | $ | (66 | ) | $ | (43,413 | ) | $ | 43,347 | ||||
AlphaCat ILS Funds - Lower Risk (c) | 110,192 | 21,757 | 88,435 | |||||||||
AlphaCat ILS Funds - Higher Risk (c) | 138,330 | 105,512 | 32,818 | |||||||||
AlphaCat Direct (d) | 17,797 | 17,797 | — | |||||||||
Total | $ | 266,253 | $ | 101,653 | $ | 164,600 |
(a) | In presenting the Company’s results, management has included and discussed the results of AlphaCat, which are presented on an asset manager basis. Validus' share of AlphaCat income is a non-GAAP measure and is not calculated under standards or rules that comprise U.S. GAAP. Such measures are referred to as non-GAAP. Non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those determined in accordance with U.S. GAAP. Further discussion of these measures is presented in the section entitled “Non-GAAP Financial Measures.” |
(b) | The investment income from the AlphaCat funds and sidecars is based on equity accounting. |
(c) | Lower risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of less than 7%, whereas higher risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of greater than 7%. Expected loss represents the average annual loss over the set of simulation scenarios divided by the total limit. |
(d) | AlphaCat Direct includes direct investments from third party investors in AlphaCat Re. |
Assets Under Management (a) | ||||||||||||
(Dollars in thousands) | July 1, 2016 | Change | January 1, 2016 | |||||||||
Assets Under Management - Related Party | ||||||||||||
AlphaCat Sidecars | $ | 8,045 | $ | (27,371 | ) | $ | 35,416 | |||||
AlphaCat ILS Funds - Lower Risk (b) | 175,832 | 11,818 | 164,014 | |||||||||
AlphaCat ILS Funds - Higher Risk (b) | 76,287 | 10,823 | 65,464 | |||||||||
AlphaCat Direct (c) | — | — | — | |||||||||
BetaCat ILS Funds | 63,453 | 1,704 | 61,749 | |||||||||
Total | $ | 323,617 | $ | (3,026 | ) | $ | 326,643 | |||||
Assets Under Management - Third Party | ||||||||||||
AlphaCat Sidecars | $ | 30,078 | $ | (124,308 | ) | $ | 154,386 | |||||
AlphaCat ILS Funds - Lower Risk (b) | 1,226,709 | 124,247 | 1,102,462 | |||||||||
AlphaCat ILS Funds - Higher Risk (b) | 564,513 | 129,662 | 434,851 | |||||||||
AlphaCat Direct (c) | 365,558 | (2,262 | ) | 367,820 | ||||||||
BetaCat ILS Funds | — | — | — | |||||||||
Total | 2,186,858 | 127,339 | 2,059,519 | |||||||||
Total Assets Under Management | $ | 2,510,475 | $ | 124,313 | $ | 2,386,162 |
(a) | The Company’s assets under management are based on NAV and are represented by investments made by related parties and third parties in the feeder funds and on a direct basis. |
(b) | Lower risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of less than 7%, whereas higher risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of greater than 7%. Expected loss represents the average annual loss over the set of simulation scenarios divided by the total limit. |
(c) | AlphaCat Direct includes direct investments from third party investors in AlphaCat Re. |
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Investment income | ||||||||||||
Net investment income (a) | $ | 64,772 | $ | 3,482 | $ | 61,290 | ||||||
Operating expenses | ||||||||||||
General and administrative expenses | 34,055 | 1,357 | 32,698 | |||||||||
Share compensation expenses | 8,099 | 2,028 | 6,071 | |||||||||
Finance expenses (a) | 28,320 | (2,160 | ) | 30,480 | ||||||||
Tax (benefit) expenses | (412 | ) | (5,526 | ) | 5,114 | |||||||
Total operating expenses | 70,062 | (4,301 | ) | 74,363 | ||||||||
Other items | ||||||||||||
Net realized gains on investments (a) | 1,434 | (4,850 | ) | 6,284 | ||||||||
Change in net unrealized gains on investments (a) | 77,130 | 76,387 | 743 | |||||||||
(Loss) income from investment affiliate | (4,702 | ) | (7,762 | ) | 3,060 | |||||||
Foreign exchange gains (losses) (a) | 12,695 | 19,388 | (6,693 | ) | ||||||||
Other income (loss) | 756 | 1,364 | (608 | ) | ||||||||
Total other items | 87,313 | 84,527 | 2,786 | |||||||||
Total corporate and investment information | $ | 82,023 | $ | 92,310 | $ | (10,287 | ) |
(a) | These items exclude the components which are included in the Company's share of AlphaCat and amounts which are consolidated from VIEs. |
Net Investment Income | ||||||||||||
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Managed investments | ||||||||||||
Fixed maturities and short-term investments | $ | 58,638 | $ | 1,532 | $ | 57,106 | ||||||
Other investments | 8,898 | 1,696 | 7,202 | |||||||||
Cash and cash equivalents | 1,245 | 402 | 843 | |||||||||
Securities lending income | 17 | 8 | 9 | |||||||||
Total gross investment income | 68,798 | 3,638 | 65,160 | |||||||||
Investment expenses | (4,026 | ) | (156 | ) | (3,870 | ) | ||||||
Total managed net investment income | $ | 64,772 | $ | 3,482 | $ | 61,290 |
Six Months Ended June 30, | ||||||
U.S. dollar (weakened) strengthened against: | 2016 | 2015 | ||||
British Pound sterling | 10.8 | % | (0.8 | )% | ||
Euro | (2.2 | )% | 8.6 | % | ||
Canadian dollar | (6.4 | )% | 7.5 | % | ||
Swiss franc | (2.6 | )% | (6.0 | )% | ||
Australian dollar | (1.9 | )% | 5.9 | % | ||
New Zealand dollar | (4.2 | )% | 14.8 | % | ||
Singapore dollar | (4.7 | )% | 1.6 | % | ||
Japanese yen | (14.7 | )% | 2.4 | % | ||
South African rand | (5.0 | )% | 5.3 | % |
Three Months Ended June 30, | ||||||||
(Dollars in thousands) | 2016 | 2015 | ||||||
Underwriting income | $ | 58,957 | $ | 109,660 | ||||
Net investment income | 39,257 | 33,611 | ||||||
Finance expenses | (14,166 | ) | (18,682 | ) | ||||
Dividends on preferred shares | — | — | ||||||
Tax expense | (1,706 | ) | (2,549 | ) | ||||
Income from operating affiliates | — | 1,738 | ||||||
(Income) attributable to AlphaCat investors | (6,114 | ) | — | |||||
Net operating (income) attributable to noncontrolling interest | (21,328 | ) | (22,061 | ) | ||||
Net operating income available to Validus common shareholders | $ | 54,900 | $ | 101,717 | ||||
Net realized gains on investments | 2,724 | 2,244 | ||||||
Change in net unrealized gains (losses) on investments | 31,428 | (34,676 | ) | |||||
(Loss) income from investment affiliate | (589 | ) | 284 | |||||
Foreign exchange gains (losses) | 6,286 | (2,671 | ) | |||||
Other income (loss) | 79 | (608 | ) | |||||
Net loss (income) attributable to noncontrolling interest | 135 | (500 | ) | |||||
Net income available to Validus common shareholders | $ | 94,963 | $ | 65,790 |
Six Months Ended June 30, | ||||||||
(Dollars in thousands) | 2016 | 2015 | ||||||
Underwriting income | $ | 201,876 | $ | 253,861 | ||||
Net investment income | 68,718 | 64,640 | ||||||
Finance expenses | (29,369 | ) | (39,649 | ) | ||||
Dividends on preferred shares | — | — | ||||||
Tax benefit (expense) | 412 | (5,114 | ) | |||||
(Loss) income from operating affiliates | (23 | ) | 5,722 | |||||
(Income) attributable to AlphaCat investors | (10,714 | ) | — | |||||
Net operating (income) attributable to noncontrolling interest | (58,622 | ) | (40,869 | ) | ||||
Net operating income available to Validus common shareholders | $ | 172,278 | $ | 238,591 | ||||
Net realized gains on investments | 2,140 | 6,413 | ||||||
Change in net unrealized gains (losses) on investments | 78,872 | (1,449 | ) | |||||
(Loss) income from investment affiliate | (4,702 | ) | 3,060 | |||||
Foreign exchange gains (losses) | 12,531 | (6,936 | ) | |||||
Other income (loss) | 756 | (608 | ) | |||||
Net (income) loss attributable to noncontrolling interest | (102 | ) | 130 | |||||
Net income available to Validus common shareholders | $ | 261,773 | $ | 239,201 |
June 30, 2016 | |||||||||||||||
(Dollars in thousands, except share and per share amounts) | Equity Amount | Shares | Exercise Price (a) | Book Value Per Share | |||||||||||
Book value per common share | |||||||||||||||
Total shareholders' equity available to Validus common shareholders (b) | $ | 3,716,256 | 80,772,238 | $ | 46.01 | ||||||||||
Tangible book value per common share | $ | 42.11 | |||||||||||||
Book value per diluted common share | |||||||||||||||
Total shareholders' equity available to Validus common shareholders (b) | 3,716,256 | 80,772,238 | |||||||||||||
Assumed exercise of outstanding stock options (c) | 1,080 | 51,357 | $ | 21.03 | |||||||||||
Unvested restricted shares | — | 2,876,998 | |||||||||||||
Book value per diluted common share | $ | 3,717,336 | 83,700,593 | $ | 44.41 | ||||||||||
Adjustment for accumulated dividends | 10.86 | ||||||||||||||
Book value per diluted common share plus accumulated dividends | $ | 55.27 | |||||||||||||
Tangible book value per diluted common share | $ | 40.65 |
December 31, 2015 | |||||||||||||||
(Dollars in thousands, except share and per share amounts) | Equity Amount | Shares | Exercise Price (a) | Book Value Per Share | |||||||||||
Book value per common share | |||||||||||||||
Total shareholders' equity available to Validus common shareholders (b) | $ | 3,638,975 | 82,900,617 | $ | 43.90 | ||||||||||
Tangible book value per common share | $ | 40.06 | |||||||||||||
Book value per diluted common share | |||||||||||||||
Total shareholders' equity available to Validus common shareholders (b) | 3,638,975 | 82,900,617 | |||||||||||||
Assumed exercise of outstanding stock options (c) | 1,319 | 65,401 | $ | 20.17 | |||||||||||
Unvested restricted shares | — | 3,026,376 | |||||||||||||
Book value per diluted common share | $ | 3,640,294 | 85,992,394 | $ | 42.33 | ||||||||||
Adjustment for accumulated dividends | 10.16 | ||||||||||||||
Book value per diluted common share plus accumulated dividends | $ | 52.49 | |||||||||||||
Tangible book value per diluted common share | $ | 38.63 |
(a) | Weighted average exercise price for those warrants and stock options that have an exercise price lower than book value per share. |
(b) | Total shareholders' equity available to Validus common shareholders excludes the liquidation value of the preferred shares of $150,000. |
(c) | Using the "as-if-converted" method, assuming all proceeds received upon exercise of warrants and stock options will be retained by the Company and the resulting common shares from exercise remain outstanding. |
June 30, 2016 | |||||||
(Dollars in thousands) | Fair Value | % of Total | |||||
Germany | $ | 58,646 | 10.1 | % | |||
United Kingdom | 36,759 | 6.3 | % | ||||
Supranational | 35,830 | 6.2 | % | ||||
France | 15,695 | 2.7 | % | ||||
Norway | 13,057 | 2.3 | % | ||||
Jordan | 10,354 | 1.8 | % | ||||
Other (individual jurisdictions below $10,000) | 44,909 | 7.7 | % | ||||
Total Managed Non-U.S. Government Securities | 215,250 | 37.1 | % | ||||
European Corporate Securities | 132,075 | 22.8 | % | ||||
United Kingdom Corporate Securities | 108,446 | 18.7 | % | ||||
Other Non-U.S. Corporate Securities | 123,885 | 21.4 | % | ||||
Total Managed Non-U.S. Fixed Maturity Portfolio | $ | 579,656 | 100.0 | % |
June 30, 2016 | |||||||||
Issuer (a) | Fair Value (b) | S&P Rating (c) | % of Total Managed Cash and Investments | ||||||
JPMorgan Chase & Co | $ | 55,981 | BBB+ | 0.9 | % | ||||
HSBC Holdings plc | 51,668 | A | 0.8 | % | |||||
Goldman Sachs Group | 47,396 | BBB+ | 0.7 | % | |||||
Morgan Stanley | 44,855 | BBB+ | 0.7 | % | |||||
Bank of America Corp | 41,513 | BBB | 0.6 | % | |||||
Citigroup Inc | 39,510 | BBB | 0.6 | % | |||||
US Bancorp | 36,612 | AA- | 0.6 | % | |||||
Anheuser-Busch Inbev NV | 33,297 | A- | 0.5 | % | |||||
Bank of New York Mellon Corp | 32,276 | A | 0.5 | % | |||||
Ford Motor Company | 32,022 | BBB | 0.5 | % | |||||
Total | $ | 415,130 | 6.4 | % |
(a) | Issuers exclude government-backed government-sponsored enterprises and cash and cash equivalents. |
(b) | Credit exposures represent only direct exposure to fixed maturities and short-term investments of the parent issuer and its major subsidiaries. These exposures exclude asset and mortgage backed securities that were issued, sponsored or serviced by the parent. |
(c) | Investment ratings are the median of Moody's, Standard & Poor's and Fitch, presented in Standard & Poor's equivalent rating. For investments where three ratings are unavailable, the lower of the ratings shall apply, presented in Standard & Poor's equivalent rating. |
June 30, 2016 | ||||||||||||
(Dollars in thousands) | Gross Case Reserves | Gross IBNR | Total Gross Reserve for Losses and Loss Expenses | |||||||||
Property | $ | 403,515 | $ | 471,549 | $ | 875,064 | ||||||
Marine | 389,833 | 479,529 | 869,362 | |||||||||
Specialty | 273,646 | 530,728 | 804,374 | |||||||||
Liability | 200,631 | 373,286 | 573,917 | |||||||||
Total | $ | 1,267,625 | $ | 1,855,092 | $ | 3,122,717 |
June 30, 2016 | ||||||||||||
(Dollars in thousands) | Net Case Reserves | Net IBNR | Total Net Reserve for Losses and Loss Expenses | |||||||||
Property | $ | 354,328 | $ | 405,042 | $ | 759,370 | ||||||
Marine | 347,628 | 375,303 | 722,931 | |||||||||
Specialty | 228,062 | 481,227 | 709,289 | |||||||||
Liability | 186,156 | 301,984 | 488,140 | |||||||||
Total | $ | 1,116,174 | $ | 1,563,556 | $ | 2,679,730 |
Three Months Ended June 30, 2016 | ||||||||||||||||||||||||
(Dollars in thousands) | Validus Re Segment | Talbot Segment | Western World Segment | AlphaCat Segment | Eliminations | Total | ||||||||||||||||||
Reserve for losses and loss expenses, beginning of period | $ | 1,107,747 | $ | 1,333,578 | $ | 593,356 | $ | 12,913 | $ | (67,294 | ) | $ | 2,980,300 | |||||||||||
Loss reserves recoverable | (31,566 | ) | (321,644 | ) | (84,773 | ) | — | 67,294 | (370,689 | ) | ||||||||||||||
Net reserves for losses and loss expenses, beginning of period | 1,076,181 | 1,011,934 | 508,583 | 12,913 | — | 2,609,611 | ||||||||||||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||||||||||||||||||
Current year | 163,016 | 137,638 | 47,387 | 21,870 | — | 369,911 | ||||||||||||||||||
Prior years | (30,877 | ) | (28,328 | ) | (3,158 | ) | (418 | ) | — | (62,781 | ) | |||||||||||||
Total incurred losses and loss expenses | 132,139 | 109,310 | 44,229 | 21,452 | — | 307,130 | ||||||||||||||||||
Foreign exchange gain | (712 | ) | (13,467 | ) | — | (175 | ) | — | (14,354 | ) | ||||||||||||||
Net paid losses | (78,230 | ) | (93,670 | ) | (50,678 | ) | (79 | ) | — | (222,657 | ) | |||||||||||||
Net reserve for losses and loss expenses, end of period | 1,129,378 | 1,014,107 | 502,134 | 34,111 | — | 2,679,730 | ||||||||||||||||||
Loss reserves recoverable | 111,015 | 308,686 | 86,018 | — | (62,732 | ) | 442,987 | |||||||||||||||||
Reserve for losses and loss expenses, end of period | $ | 1,240,393 | $ | 1,322,793 | $ | 588,152 | $ | 34,111 | $ | (62,732 | ) | $ | 3,122,717 |
Six Months Ended June 30, 2016 | ||||||||||||||||||||||||
(Dollars in thousands) | Validus Re Segment | Talbot Segment | Western World | AlphaCat Segment | Eliminations | Total | ||||||||||||||||||
Reserve for losses and loss expenses, beginning of period | $ | 1,146,869 | $ | 1,302,635 | $ | 600,331 | $ | 11,013 | $ | (64,281 | ) | $ | 2,996,567 | |||||||||||
Loss reserves recoverable | (36,055 | ) | (293,662 | ) | (85,150 | ) | — | 64,281 | (350,586 | ) | ||||||||||||||
Net reserves for losses and loss expenses, beginning of period | 1,110,814 | 1,008,973 | 515,181 | 11,013 | — | 2,645,981 | ||||||||||||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||||||||||||||||||
Current year | 271,568 | 260,459 | 91,459 | 24,611 | — | 648,097 | ||||||||||||||||||
Prior years | (56,561 | ) | (51,048 | ) | (7,584 | ) | (1,327 | ) | — | (116,520 | ) | |||||||||||||
Total incurred losses and loss expenses | 215,007 | 209,411 | 83,875 | 23,284 | — | 531,577 | ||||||||||||||||||
Foreign exchange loss (gain) | 12,101 | (18,130 | ) | — | (65 | ) | — | (6,094 | ) | |||||||||||||||
Net paid losses | (208,544 | ) | (186,147 | ) | (96,922 | ) | (121 | ) | — | (491,734 | ) | |||||||||||||
Net reserves for losses and loss expenses, end of period | 1,129,378 | 1,014,107 | 502,134 | 34,111 | — | 2,679,730 | ||||||||||||||||||
Loss reserves recoverable | 111,015 | 308,686 | 86,018 | — | (62,732 | ) | 442,987 | |||||||||||||||||
Reserve for losses and loss expenses, end of period | $ | 1,240,393 | $ | 1,322,793 | $ | 588,152 | $ | 34,111 | $ | (62,732 | ) | $ | 3,122,717 |
Reserves for Notable Loss Events (Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||
2014 Notable Loss Event | Year Ended December 31, 2014 | Year Ended December 31, 2015 | Six Months Ended June 30, 2016 | |||||||||||||||||||||||||||||||||||||
Development | Closing | Development | Closing | Development | Closing | |||||||||||||||||||||||||||||||||||
Initial | (Favorable) / | Allocations | Estimate (c) | (Favorable) / | Allocations | Estimate (c) | (Favorable) / | Allocations | Estimate (c) | |||||||||||||||||||||||||||||||
Notable Loss Event | Estimate (a) | Unfavorable (b) | of RDE | December 31, 2014 | Unfavorable (b) | of RDE | December 31, 2015 | Unfavorable (b) | of RDE | June 30, 2016 | ||||||||||||||||||||||||||||||
Tripoli Airport (e) | $ | 28,134 | $ | 6,810 | — | $ | 34,944 | $ | (1,196 | ) | — | $ | 33,748 | $ | 18 | — | $ | 33,766 | ||||||||||||||||||||||
Year Ended December 31, 2014 | Year Ended December 31, 2015 | Six Months Ended June 30, 2016 | ||||||||||||||||||||||||||||||||||||||
Closing | Closing | Closing | ||||||||||||||||||||||||||||||||||||||
Paid Loss (Recovery) | Reserve (d) | Paid Loss (Recovery) | Reserve (d) | Paid Loss (Recovery) | Reserve (d) | |||||||||||||||||||||||||||||||||||
Notable Loss Event | December 31, 2014 | December 31, 2015 | June 30, 2016 | |||||||||||||||||||||||||||||||||||||
Tripoli Airport (e) | $ | — | $ | 34,944 | $ | 22,938 | $ | 10,810 | $ | 62 | $ | 10,766 | ||||||||||||||||||||||||||||
2015 Notable Loss Events | Year Ended December 31, 2015 | Six Months Ended June 30, 2016 | ||||||||||||||||||||||||||||||||||||||
Development | Closing | Development | Closing | |||||||||||||||||||||||||||||||||||||
Initial | (Favorable) / | Allocations | Estimate (c) | (Favorable) / | Allocations | Estimate (c) | ||||||||||||||||||||||||||||||||||
Notable Loss Events | Estimate (a) | Unfavorable (b) | of RDE | December 31, 2015 | Unfavorable (b) | of RDE | June 30, 2016 | |||||||||||||||||||||||||||||||||
Pemex | $ | 48,074 | $ | 1,464 | — | $ | 49,538 | $ | (426 | ) | — | $ | 49,112 | |||||||||||||||||||||||||||
Tianjin | 47,789 | (362 | ) | — | 47,427 | (1,644 | ) | — | 45,783 | |||||||||||||||||||||||||||||||
Total 2015 Notable Loss Events | $ | 95,863 | $ | 1,102 | $ | — | $ | 96,965 | $ | (2,070 | ) | $ | — | $ | 94,895 | |||||||||||||||||||||||||
Year Ended December 31, 2015 | Six Months Ended June 30, 2016 | |||||||||||||||||||||||||||||||||||||||
Closing | Closing | |||||||||||||||||||||||||||||||||||||||
Paid Loss (Recovery) | Reserve (d) | Paid Loss (Recovery) | Reserve (d) | |||||||||||||||||||||||||||||||||||||
Notable Loss Events | December 31, 2015 | June 30, 2016 | ||||||||||||||||||||||||||||||||||||||
Pemex | $ | 44 | $ | 49,494 | $ | 46 | $ | 49,022 | ||||||||||||||||||||||||||||||||
Tianjin | — | 47,427 | 1,657 | 44,126 | ||||||||||||||||||||||||||||||||||||
Total 2015 Notable Loss Events | $ | 44 | $ | 96,921 | $ | 1,703 | $ | 93,148 | ||||||||||||||||||||||||||||||||
2016 Notable Loss Event | Six Months Ended June 30, 2016 | |||||||||||||||||||||||||||||||||||||||
Development | Closing | |||||||||||||||||||||||||||||||||||||||
Initial | (Favorable) / | Allocations | Estimate (c) | |||||||||||||||||||||||||||||||||||||
Notable Loss Event | Estimate (a) | Unfavorable (b) | of RDE | June 30, 2016 | ||||||||||||||||||||||||||||||||||||
Canadian Wildfires | $ | 36,915 | $ | — | — | $ | 36,915 | |||||||||||||||||||||||||||||||||
Six Months Ended June 30, 2016 | ||||||||||||||||||||||||||||||||||||||||
Closing | ||||||||||||||||||||||||||||||||||||||||
Paid Loss (Recovery) | Reserve (d) | |||||||||||||||||||||||||||||||||||||||
Notable Loss Event | June 30, 2016 | |||||||||||||||||||||||||||||||||||||||
Canadian Wildfires | 85 | 36,830 |
(a) | Includes paid losses, case reserves and IBNR reserves. |
(b) | Development other than allocation of RDE. |
(c) | Excludes impact of movements in foreign exchange rates. |
(d) | Closing Reserve for the period equals Closing Estimate for the period less cumulative Paid Losses (Recovery). |
(e) | As at September 30, 2014, the initial estimate for Tripoli Airport was below the $30.0 million notable loss event threshold; however, during the fourth quarter of 2014 adverse development caused this event to exceed the notable loss event threshold. |
(Dollars in thousands) | June 30, 2016 | |||
Validus Reinsurance, Ltd. (excluding capital supporting FAL) (a) (b) | $ | 3,686,639 | ||
Talbot Holdings, Ltd. (including capital supporting FAL) (b) | 917,798 | |||
Other, net | 45,067 | |||
Redeemable noncontrolling interest in AlphaCat | 1,532,283 | |||
Noncontrolling interest in AlphaCat | 212,154 | |||
Total consolidated capitalization | 6,393,941 | |||
Senior notes payable | (245,261 | ) | ||
Debentures payable | (537,987 | ) | ||
Redeemable noncontrolling interest in AlphaCat | (1,532,283 | ) | ||
Total shareholders’ equity | 4,078,410 | |||
Preferred shares (c) | (150,000 | ) | ||
Noncontrolling interest in AlphaCat | (212,154 | ) | ||
Total shareholders' equity available to Validus common shareholders (c) | $ | 3,716,256 |
(a) | Validus Reinsurance, Ltd. (excluding capital supporting FAL) includes capital of $661,480 relating to Western World Insurance Group, Inc. |
(b) | Validus Reinsurance, Ltd. (excluding capital supporting FAL) excludes capital of $737,168 which supports Talbot's FAL. This capital was included in Talbot Holdings, Ltd. (including capital supporting FAL). |
(c) | Total shareholders' equity available to Validus common shareholders excludes the liquidation value of the preferred shares of $150,000. |
Six Months Ended June 30, | ||||||||||||
(Dollars in thousands) | 2016 | Change | 2015 | |||||||||
Net cash provided by operating activities | $ | 69,443 | $ | 36,969 | $ | 32,474 | ||||||
Net cash used in investing activities | (469,003 | ) | (408,188 | ) | (60,815 | ) | ||||||
Net cash provided by (used in) financing activities | 252,217 | 326,455 | (74,238 | ) | ||||||||
Effect of foreign currency rate changes on cash and cash equivalents | (6,968 | ) | 1,762 | (8,730 | ) | |||||||
Net decrease in cash and cash equivalents | $ | (154,311 | ) | $ | (43,002 | ) | $ | (111,309 | ) |
Capitalization (Dollars in thousands) | June 30, 2016 | December 31, 2015 | |||||
Senior Notes (a) | $ | 245,261 | $ | 245,161 | |||
Junior Subordinated Deferrable Debentures (JSDs) (a) | 289,800 | 289,800 | |||||
Flagstone Junior Subordinated Deferrable Debentures (JSDs) (a) | 248,187 | 247,868 | |||||
Total debt | $ | 783,248 | $ | 782,829 | |||
Redeemable noncontrolling interest | $ | 1,532,283 | $ | 1,111,714 | |||
Preferred shares (b) | $ | 150,000 | $ | — | |||
Ordinary shares, capital and surplus available to Validus | 3,734,438 | 3,651,544 | |||||
Accumulated other comprehensive loss | (18,182 | ) | (12,569 | ) | |||
Noncontrolling interest | 212,154 | 154,662 | |||||
Total shareholders' equity | $ | 4,078,410 | $ | 3,793,637 | |||
Total capitalization (c) | $ | 6,393,941 | $ | 5,688,180 | |||
Total capitalization available to Validus (d) | $ | 4,649,504 | $ | 4,421,804 | |||
Debt to total capitalization | 12.2 | % | 13.8 | % | |||
Debt (excluding JSDs) to total capitalization | 3.8 | % | 4.3 | % | |||
Debt and preferred shares to total capitalization | 14.6 | % | 13.8 | % | |||
Debt to total capitalization available to Validus | 16.8 | % | 17.7 | % | |||
Debt (excluding JSDs) to total capitalization available to Validus | 5.3 | % | 5.5 | % | |||
Debt and preferred shares to total capitalization available to Validus | 20.1 | % | 17.7 | % |
(a) | Refer to Part I, Item 1, Note 13, “Debt and financing arrangements," to the Consolidated Financial Statements for further details and discussion on the debt and financing arrangements of the Company. |
(b) | Refer to Part I, Item 1, Note 11, “Share capital," to the Consolidated Financial Statements for further details and discussion on the Company's preferred shares. |
(c) | Total capitalization equals shareholders' equity plus noncontrolling interests, Senior Notes and Junior Subordinated Deferrable Debentures. |
(d) | Total capitalization available to Validus equals total shareholder's equity less noncontrolling interests plus Senior Notes and Junior Subordinated Deferrable Debentures. |
(Dollars in thousands) | Maturity Date / Term (a) | Commitment | Issued and Outstanding (b) | ||||||
2006 Junior Subordinated Deferrable Debentures | June 15, 2036 | $ | 150,000 | $ | 150,000 | ||||
2007 Junior Subordinated Deferrable Debentures | June 15, 2037 | 200,000 | 139,800 | ||||||
Flagstone 2006 Junior Subordinated Deferrable Debentures | September 15, 2036 | 134,437 | 134,437 | ||||||
Flagstone 2007 Junior Subordinated Deferrable Debentures | September 15, 2037 | 113,750 | 113,750 | ||||||
Total debentures payable | 598,187 | 537,987 | |||||||
2010 Senior Notes due 2040 | January 26, 2040 | 250,000 | 250,000 | ||||||
Total debentures and senior notes payable | 848,187 | 787,987 | |||||||
$85,000 syndicated unsecured letter of credit facility | December 9, 2020 | 85,000 | — | ||||||
$300,000 syndicated secured letter of credit facility | December 9, 2020 | 300,000 | 105,575 | ||||||
$24,000 secured bi-lateral letter of credit facility | Evergreen | 24,000 | 11,805 | ||||||
AlphaCat Re secured letter of credit facility | Evergreen | 20,000 | 20,000 | ||||||
IPC bi-lateral facility | Evergreen | 25,000 | 5,666 | ||||||
$236,000 Flagstone bi-lateral facility | Evergreen | 236,000 | 195,622 | ||||||
Total credit and other facilities | 690,000 | 338,668 | |||||||
Total debt and financing arrangements | $ | 1,538,187 | $ | 1,126,655 |
(a) | The arrangement is indicated as evergreen if, unless written notice to the contrary is given, it automatically renews on a regular basis. |
(b) | Indicates utilization of commitment amount, not necessarily drawn borrowings. |
A.M. Best | S&P | Moody’s | Fitch | ||||
Validus Holdings, Ltd. | |||||||
Issuer credit rating | bbb | BBB+ | Baa2 | A- | |||
Senior debt | bbb | BBB+ | Baa2 | BBB+ | |||
Subordinated debt | bbb- | — | Baa3 | BBB | |||
Preferred stock | bb+ | BBB- | Ba1 | BBB | |||
Outlook on ratings | Positive | Stable | Positive | Stable | |||
Validus Reinsurance, Ltd. | |||||||
Financial strength rating | A | A | A3 | A | |||
Outlook on ratings | Stable | Stable | Positive | Stable | |||
Lloyd's of London | |||||||
Financial strength rating applicable to all Lloyd's syndicates | A | A+ | — | AA- | |||
Outlook on ratings | Stable | Stable | — | Stable | |||
Validus Reinsurance (Switzerland), Ltd. | |||||||
Financial strength rating | A | A | — | — | |||
Outlook on ratings | Stable | Stable | — | — | |||
Western World Insurance Company | |||||||
Financial strength rating | A | — | — | — | |||
Outlook on ratings | Stable | — | — | — |
• | reserve for losses and loss expenses; |
• | premium estimates for business written on a line slip or proportional basis; |
• | the valuation of goodwill and intangible assets; |
• | reinsurance recoverable balances including the provision for uncollectible amounts; and |
• | investment valuation of financial assets. |
• | unpredictability and severity of catastrophic events; |
• | our ability to obtain and maintain ratings, which may affect by our ability to raise additional equity or debt financings, as well as other factors described herein; |
• | adequacy of the Company’s risk management and loss limitation methods; |
• | cyclicality of demand and pricing in the insurance and reinsurance markets; |
• | the Company’s ability to implement its business strategy during “soft” as well as “hard” markets; |
• | adequacy of the Company’s loss reserves; |
• | continued availability of capital and financing; |
• | the Company’s ability to identify, hire and retain, on a timely and unimpeded basis and on anticipated economic and other terms, experienced and capable senior management, as well as underwriters, claims professionals and support staff; |
• | acceptance of our business strategy, security and financial condition by rating agencies and regulators, as well as by brokers and (re)insureds; |
• | competition, including increased competition, on the basis of pricing, capacity, coverage terms or other factors; |
• | potential loss of business from one or more major insurance or reinsurance brokers; |
• | the Company’s ability to implement, successfully and on a timely basis, complex infrastructure, distribution capabilities, systems, procedures and internal controls, and to develop accurate actuarial data to support the business and regulatory and reporting requirements; |
• | general economic and market conditions (including inflation, volatility in the credit and capital markets, interest rates and foreign currency exchange rates) and conditions specific to the insurance and reinsurance markets in which we operate; |
• | the integration of businesses we may acquire or new business ventures, including overseas offices, we may start and the risk associated with implementing our business strategies and initiatives with respect to the new business ventures; |
• | accuracy of those estimates and judgments used in the preparation of our financial statements, including those related to revenue recognition, insurance and other reserves, reinsurance recoverables, investment valuations, intangible assets, bad debts, taxes, contingencies, litigation and any determination to use the deposit method of accounting, which, for a relatively new insurance and reinsurance company like our company, are even more difficult to make than those made in a mature company because of limited historical information; |
• | the effect on the Company’s investment portfolio of changing financial market conditions including inflation, interest rates, liquidity and other factors; |
• | acts of terrorism, political unrest, outbreak of war and other hostilities or other non-forecasted and unpredictable events; |
• | availability and cost of reinsurance and retrocession coverage; |
• | the failure of reinsurers, retrocessionaires, producers or others to meet their obligations to us; |
• | the timing of loss payments being faster or the receipt of reinsurance recoverables being slower than anticipated by us; |
• | changes in domestic or foreign laws or regulations, or their interpretations; |
• | changes in accounting principles or the application of such principles by regulators; |
• | statutory or regulatory or rating agency developments, including as to tax policy and reinsurance and other regulatory matters such as the adoption of proposed legislation that would affect Bermuda-headquartered companies and/or Bermuda-based insurers or reinsurers; and |
• | the other factors set forth under Part I Item 1A "Risk Factors" and under Part II Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the other sections of the Company's Annual Report on Form 10-K for the year ended December 31, 2015, as well as the risk and other factors set forth in the Company's other filings with the SEC, as well as management's response to any of the aforementioned factors. |
• | interest rate risk; |
• | foreign currency risk; |
• | credit risk; |
• | liquidity risk; and |
• | inflation risk. |
June 30, 2016 | December 31, 2015 | |||||||||||||
(Dollars in thousands) | Increase (decrease) in market value | Increase (decrease) in market value | ||||||||||||
Immediate 100 basis point increase in market interest rates | $ | (127,105 | ) | (2.3 | )% | $ | (126,908 | ) | (2.4 | )% | ||||
Immediate 100 basis point decrease in market interest | $ | 125,452 | 2.2 | % | $ | 127,976 | 2.4 | % |
June 30, 2016 | December 31, 2015 | |||||||||||||
(Dollars in thousands) | Balance | % of Total | Balance | % of Total | ||||||||||
Total monetary assets held in foreign currencies | $ | 612,970 | 5.2 | % | $ | 568,153 | 5.4 | % | ||||||
Total monetary liabilities held in foreign currencies | 751,370 | 12.1 | % | 732,730 | 13.1 | % | ||||||||
Total non-monetary assets that do not require revaluation | 17,970 | 0.2 | % | 15,937 | 0.2 | % | ||||||||
Total non-monetary liabilities that do not require revaluation | 92,830 | 1.5 | % | 81,718 | 1.5 | % |
Second Quarter Share Repurchase Activity | ||||||||||||||||||||
Effect of share repurchases (Dollars in thousands, except per share amounts) | As at March 31, 2016 | Three Months Ended | ||||||||||||||||||
(cumulative) | April | May | June | June 30, 2016 | ||||||||||||||||
Aggregate purchase price (a) | $ | 2,552,098 | $ | 387 | $ | 32,686 | $ | 35,643 | $ | 68,716 | ||||||||||
Shares repurchased | 77,387,916 | 8,718 | 686,272 | 758,852 | 1,453,842 | |||||||||||||||
Average price (a) | $ | 32.98 | $ | 44.45 | $ | 47.63 | $ | 46.97 | $ | 47.27 | ||||||||||
Maximum number of shares that may yet be purchased under the program (b) | 10,619,240 | 9,092,374 | 8,393,464 |
Share Repurchase Activity Post Quarter End | ||||||||||||||||||||
Effect of share repurchases (Dollars in thousands, except per share amounts) | As at June 30, 2016 (cumulative) | July | August | As at August 3, 2016 | Cumulative to Date Effect | |||||||||||||||
Aggregate purchase price (a) | $ | 2,620,814 | $ | 18,438 | $ | 2,877 | $ | 21,315 | $ | 2,642,129 | ||||||||||
Shares repurchased | 78,841,758 | 382,648 | 58,089 | 440,737 | 79,282,495 | |||||||||||||||
Average price (a) | $ | 33.24 | $ | 48.18 | $ | 49.53 | $ | 48.36 | $ | 33.33 |
(a) | Share transactions are on a trade date basis through August 3, 2016 and are inclusive of commissions. Average share price is rounded to two decimal places. |
(b) | The maximum number of shares that may yet be purchased under the program is calculated using the average execution price at month end. |
Exhibit | Description |
Exhibit 4.1* | Fifth Supplemental Indenture dated as of July 13, 2016 between Validus Reinsurance, Ltd. and Wilmington Trust Company, a Delaware trust company, as trustee |
Exhibit 4.2* | Fourth Supplemental Indenture dated as of July 12, 2016 between Validus UPS, Ltd. and Wilmington Trust Company, a Delaware trust company, as trustee |
Exhibit 4.3* | Fourth Supplemental Indenture dated as of July 13, 2016 between Validus Reinsurance Ltd. and The Bank of New York Mellon Trust Company, National Association (as successor in interest to The Bank of New York Trust Company, National Association), as trustee |
Exhibit 4.4* | Fourth Supplemental Indenture dated as of July 13, 2016 between Validus Reinsurance Ltd. and The Bank of New York Mellon Trust Company, National Association (as successor in interest to JPMorgan Chase Bank, National Association), as trustee |
Exhibit 4.5* | Amendment No. 3 to Note Purchase Agreement dated as of July 13, 2016 between Validus Reinsurance, Ltd. and Validus Holdings, Ltd. as Guarantor |
Exhibit 4.6 | Certificate of Designations of 5.875% Non-Cumulative Preference Shares, Series A, of Validus Holdings, Ltd. (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on June 13, 2016) |
Exhibit 4.7 | Specimen 5.875% Non-Cumulative Preference Shares, Series A (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on June 13, 2016) |
Exhibit 4.8 | Form of depositary receipt (incorporated by reference to Exhibit 4.4 to the Company’s Current Report on Form 8-K filed on June 13, 2016) |
Exhibit 10.1* | Amended and Restated Employment Agreement dated as of June 1, 2016 between Validus Holdings, Ltd. and Michael Moore |
Exhibit 10.2* | Amended and Restated Employment Agreement dated as of May 18, 2016 between Validus Holdings, Ltd. Patrick Boisvert |
Exhibit 10.3* | Form of Amended Restricted Share Award Agreement for Talbot Executive Officers |
Exhibit 31.1* | Certification of Chief Executive Officer pursuant to Section 302 of The Sarbanes-Oxley Act of 2002. |
Exhibit 31.2* | Certification of Chief Financial Officer pursuant to Section 302 of The Sarbanes-Oxley Act of 2002. |
Exhibit 32* | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of The Sarbanes-Oxley Act of 2002. |
Exhibit 101.1 INS* | XBRL Instance Document |
Exhibit 101.SCH* | XBRL Taxonomy Extension Schema Document |
Exhibit 101.CAL* | XBRL Taxonomy Extension Calculation Linkbase Document |
Exhibit 101.LAB* | XBRL Taxonomy Extension Label Linkbase Document |
Exhibit 101.PRE* | XBRL Taxonomy Extension Presentation Linkbase Document |
Exhibit 101.DEF* | XBRL Taxonomy Extension Definition Linkbase Document |
VALIDUS HOLDINGS, LTD. | ||
(Registrant) | ||
Date: | August 5, 2016 | /s/ Edward J. Noonan |
Edward J. Noonan | ||
Chief Executive Officer | ||
Date: | August 5, 2016 | /s/ Jeffrey D. Sangster |
Jeffrey D. Sangster | ||
Executive Vice President and Chief Financial Officer |
If to the Executive: | To the last address delivered to the Company by the Executive in the manner set forth herein. |
If to the Company: | Validus Holdings, Ltd. 29 Richmond Road Pembroke, HM08 Bermuda Attn: General Counsel |
If to the Executive: | To the last address delivered to the Company by the Executive in the manner set forth herein. |
If to the Company: | Validus Holdings, Ltd. 29 Richmond Road Pembroke, HM08 Bermuda Attn: General Counsel |
1. | Award of Shares: Pursuant to the provisions of the Plan, the terms of which are incorporated herein by reference, the Participant is hereby awarded the number of Restricted Shares set forth in the Grant Letter (the “Award”), subject to the terms and conditions of the Plan and those herein set forth. The Award is granted as of the date set forth in the Grant Letter. Capitalized terms used herein and not defined shall have the meanings set forth in the Plan. In the event of any conflict between this Agreement and the Plan, the Plan shall control. |
2. | Terms and Conditions: It is understood and agreed that the Award of Restricted Shares evidenced hereby is subject to the following terms and conditions: |
(a) | Vesting of Award: Subject to the provisions of this Section 2 below and the other terms and conditions of this Agreement, this Award shall vest as set forth in the Grant Letter. All dividends and other amounts receivable in connection with any adjustments to the Shares under Section 4(b) of the Plan shall be subject to the vesting schedule herein and shall be paid to the Participant upon any vesting of the Restricted Shares hereunder in respect of which such dividends or other amounts are payable. |
(b) | Termination by a Group Company with Cause or as a result of the Participant’s Permanent Disability: If the Participant’s employment is terminated by a Group Company (as defined below) with Cause or as a result of the Participant’s Permanent Disability, any portion of the Award that is not vested on the date of Termination of Service shall be forfeited by the Participant and become the property of the Company. For purposes of this Agreement, the Participant shall be considered to have incurred a Termination of Service on the date notice of termination (“Notice of Termination”) of the Participant’s employment is given by the Participant (such date being a “Notice Date”), unless the Participant remains actively employed with any Group Company after such date, in which case a Termination of Service will be deemed to occur hereunder on the date the |
(c) | Termination by a Group Company not for Cause or by the Participant for Good Reason: Except as provided in Sections 2(e) and 2(f) below, 45% of the unvested portion of the Award shall vest (i) in the event the Participant’s employment is terminated by a Group Company not for Cause, upon the delivery by such Group Company of a notice of termination not for Cause, or (ii) in the event the Participant’s employment is terminated by the Participant for Good Reason, at the end of the applicable correction period following the Participant’s delivery of Good Reason Notice, so long as the Group Company has not corrected the event or condition giving rise to Good Reason by the end of the correction period; and the remaining 55% of the unvested portion of the Award will vest on the last vesting date for such award as set forth in the Grant Letter but only if the Participant (i) delivers to the Company a legal release letter in a form satisfactory to the Company and (ii) does not breach (a) any confidentiality, noncompetition, non-solicitation or assignment of inventions policies, terms, conditions or |
(d) | Resignation Without Good Reason: If the Participant’s employment shall be terminated as a result of the Participant’s resignation or leaving of his employment, other than for Good Reason, no portion of the Award shall vest on or following the Notice Date. Any portion of the Award that has not vested on the Notice Date shall be forfeited by the Participant and become the property of the Company. |
(e) | Change in Control: Notwithstanding any provision of this Agreement to the contrary, if, within two years following a Change in Control, the Participant’s employment is terminated by a Group Company not for Cause or by the Participant for Good Reason, the Award shall become immediately vested in full upon such termination of employment. For purposes of this Agreement, "Change in Control" shall have the meaning set forth in the Plan. |
(f) | Death of the Participant: If the Participant’s employment is terminated by a Group Company by reason of the Participant’s death, any unvested portion of the Award shall become immediately vested in full and be transferred to the beneficiary named by the Participant. |
(g) | Termination of Service; Forfeiture of Unvested Shares: In the event of Termination of Service of the Participant other than as set forth above prior to the date the Award otherwise becomes vested, the unvested portion of the Award shall immediately be forfeited by the Participant and become the property of the Company. |
(h) | In the event that the Participant is found to have materially breached any provision of his or her employment agreement or the Company’s Employee |
(i) | Certificates: Each certificate or other evidence of ownership issued in respect of Restricted Shares awarded hereunder shall be deposited with the Company, or its designee, together with, if requested by the Company, a stock power executed in blank by the Participant, and shall bear a legend disclosing the restrictions on transferability imposed on such Restricted Shares by this Agreement (the “Restrictive Legend”). Upon the vesting of Restricted Shares pursuant to Section 2 hereof and the satisfaction of any tax liability pursuant to Section 5 hereof, the certificates evidencing such vested Shares, not bearing the Restrictive Legend, shall be delivered to the Participant or other evidence of vested Shares shall be provided to the Participant. |
(j) | Rights of a Stockholder: Prior to the time a Restricted Share is fully vested hereunder, the Participant shall have no right to transfer, pledge, hypothecate or otherwise encumber such Restricted Share. During such period, the Participant shall have all other rights of a stockholder, including, but not limited to, the right to vote and to receive dividends (subject to Section 2(a) hereof) at the time paid on such Restricted Shares. |
(k) | No Right to Continued Employment: This Award shall not confer upon the Participant any right with respect to continuance of employment by any Group Company nor shall this Award interfere with the right of any Group Company to terminate the Participant’s employment at any time. |
3. | Transfer of Shares: Any vested Shares delivered hereunder, or any interest therein, may be sold, assigned, pledged, hypothecated, encumbered, or transferred or disposed of in any other manner, in whole or in part, only in compliance with the terms, conditions and restrictions as set forth in the governing instruments of the Company, the provisions of this Agreement, applicable federal and state securities laws or any other applicable laws or regulations and the terms and conditions hereof. |
4. | Expenses of Issuance of Shares: The issuance of stock certificates hereunder shall be without charge to the Participant. The Company shall pay any issuance, stamp or documentary taxes (other than transfer taxes) or charges imposed by any governmental body, agency or official (other than income taxes) by reason of the issuance of Shares. |
5. | Taxation: The Participant agrees and undertakes to be responsible for, and to indemnify any relevant Group Company in respect of, any liability of such Group Company to account to any tax authority for any amount of, or representing, income tax or national insurance contributions (excluding any employer’s secondary national insurance contributions) or any other personal tax, charge, levy or other sum whether under the laws of the United Kingdom or otherwise which may arise on the Award and such agreement and/or undertaking may be in such form as the relevant Group Company may reasonably require. In the event that the Participant wishes to make an election under Section 431 of the Income Tax (Earnings and Pensions) Act 2003 for the full |
6. | Forfeiture Upon Breach of Certain Other Agreements: The Participant’s breach of any non-compete, nondisclosure, non-solicitation, assignment of inventions, or other intellectual property agreement that he may be a party to with any Group Company, in addition to whatever other equitable relief or monetary damages that such Group Company may be entitled to, shall, for a period of five years from the date of grant, result in automatic rescission, forfeiture, cancellation, and return of any Shares (whether or not otherwise vested) held by the Participant, and all profits, proceeds, gains, or other consideration received through the sale or other transfer of the Shares shall be promptly returned and repaid to the Company. |
7. | References: References herein to rights and obligations of the Participant shall apply, where appropriate, to the Participant’s legal representative or estate without regard to whether specific reference to such legal representative or estate is contained in a particular provision of this Agreement. |
8. | Notices: Any notice required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given when delivered personally or by courier, or sent by certified or registered mail, postage prepaid, return receipt requested, duly addressed to the party concerned at the address indicated below or to such changed address as such party may subsequently by similar process give notice of: |
9. | Governing Law: This Agreement shall be governed by and construed in accordance with the laws of Bermuda, without giving effect to principles of conflict of laws. |
1. | I have reviewed this Quarterly Report on Form 10-Q of Validus Holdings, Ltd.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ EDWARD J. NOONAN | ||
Edward J. Noonan Chief Executive Officer |
1. | I have reviewed this Quarterly Report on Form 10-Q of Validus Holdings, Ltd.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ JEFFREY D. SANGSTER | ||
Jeffrey D. Sangster Executive Vice President and Chief Financial Officer |
/s/ EDWARD J. NOONAN | ||
Edward J. Noonan Chief Executive Officer Validus Holdings, Ltd. |
/s/ JEFFREY D. SANGSTER | ||
Jeffrey D. Sangster Executive Vice President and Chief Financial Officer Validus Holdings, Ltd. |
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Document and Entity Information - shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Aug. 03, 2016 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | VALIDUS HOLDINGS LTD | |
Entity Central Index Key | 0001348259 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2016 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 80,337,635 |
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Assets | ||
Fixed maturities, at amortized cost or cost | $ 5,524,027 | $ 5,556,900 |
Short-term investments, at amortized cost or cost | 2,369,704 | 1,941,615 |
Other investments, at amortized cost or cost | 338,669 | 315,963 |
Investments in and advance to affiliates, subsidiaries, associates, and joint ventures, at cost | $ 86,101 | $ 70,186 |
Preferred shares - Shareholders' Equity | ||
Preferred shares, shares issued | 6,000 | 0 |
Preferred shares, shares outstanding | 6,000 | 0 |
Common Shares - Shareholders' Equity | ||
Common shares, shares issued | 161,252,871 | 160,570,772 |
Common shares, shares outstanding | 80,772,238 | 82,900,617 |
Treasury stock, common shares | 80,480,633 | 77,670,155 |
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|||
Revenues | ||||||
Gross premiums written | $ 764,042 | $ 726,168 | $ 1,936,833 | $ 1,845,392 | ||
Reinsurance premiums ceded | (36,229) | (55,418) | (204,064) | (246,743) | ||
Net premiums written | 727,813 | 670,750 | 1,732,769 | 1,598,649 | ||
Change in unearned premiums | (154,090) | (98,062) | (587,778) | (450,071) | ||
Net premiums earned | 573,723 | 572,688 | 1,144,991 | 1,148,578 | ||
Net investment income | 39,257 | 33,611 | 68,718 | 64,640 | ||
Net realized gains on investments | 2,724 | 2,244 | 2,140 | 6,413 | ||
Change in net unrealized gains (losses) on investments | 31,428 | (34,676) | 78,872 | (1,449) | ||
(Loss) income from investment affiliate | (589) | 284 | (4,702) | 3,060 | ||
Other insurance related income and other income | 824 | 100 | 2,237 | 1,040 | ||
Foreign exchange gains (losses) | 6,286 | (2,671) | 12,531 | (6,936) | ||
Total revenues | 653,653 | 571,580 | 1,304,787 | 1,215,346 | ||
Expenses | ||||||
Losses and loss expenses | [1] | 307,130 | 266,146 | 531,577 | 507,075 | |
Policy acquisition costs | 107,966 | 104,323 | 215,159 | 202,734 | ||
General and administrative expenses | 89,688 | 84,025 | 175,896 | 168,260 | ||
Share compensation expenses | 10,727 | 9,242 | 21,964 | 18,296 | ||
Finance expenses | 14,166 | 18,682 | 29,369 | 39,649 | ||
Total expenses | 529,677 | 482,418 | 973,965 | 936,014 | ||
Income before taxes, income from operating affiliates and (income) attributable to AlphaCat investors | 123,976 | 89,162 | 330,822 | 279,332 | ||
Tax (expense) benefit | (1,706) | (2,549) | 412 | (5,114) | ||
Income (loss) from operating affiliates | 0 | 1,738 | (23) | 5,722 | ||
(Income) attributable to AlphaCat investors | (6,114) | 0 | (10,714) | 0 | ||
Net income | 116,156 | 88,351 | 320,497 | 279,940 | ||
Net (income) attributable to noncontrolling interest | (21,193) | (22,561) | (58,724) | (40,739) | ||
Net income available to Validus | 94,963 | 65,790 | 261,773 | 239,201 | ||
Dividends on preferred shares | 0 | 0 | 0 | 0 | ||
Net income available to Validus common shareholders | 94,963 | 65,790 | 261,773 | 239,201 | ||
Comprehensive income | ||||||
Net income | 116,156 | 88,351 | 320,497 | 279,940 | ||
Other comprehensive (loss) income | ||||||
Change in foreign currency translation adjustments | (3,287) | 2,763 | (5,315) | (256) | ||
Change in minimum pension liability, net of tax | 479 | 422 | 396 | 157 | ||
Change in fair value of cash flow hedge | 64 | 390 | (694) | (411) | ||
Other comprehensive (loss) income | (2,744) | 3,575 | (5,613) | (510) | ||
Comprehensive (income) attributable to noncontrolling interest | (21,193) | (22,561) | (58,724) | (40,739) | ||
Comprehensive income available to Validus | $ 92,219 | $ 69,365 | $ 256,160 | $ 238,691 | ||
Weighted average number of common shares and common share equivalents outstanding | ||||||
Basic | 81,950,833 | 84,003,549 | 82,386,047 | 83,627,396 | ||
Diluted | 83,373,003 | 87,313,154 | 83,785,659 | 87,448,142 | ||
Basic earnings per share available to common shareholders | $ 1.16 | $ 0.77 | $ 3.18 | $ 2.83 | ||
Earnings per diluted share available to Validus common shareholders | 1.14 | 0.75 | 3.12 | 2.74 | ||
Cash dividends declared per share | $ 0.35 | $ 0.32 | $ 0.7 | $ 0.64 | ||
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Basis of preparation and consolidation |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of presentation and consolidation | Basis of preparation and consolidation These unaudited Consolidated Financial Statements (the "Consolidated Financial Statements") have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 in Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In addition, the year-end balance sheet data was derived from audited financial statements but does not include all disclosures required by U.S. GAAP. This Quarterly Report on Form 10-Q should be read in conjunction with the financial statements and related notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the U.S. Securities and Exchange Commission (the "SEC"). The Company consolidates in these Consolidated Financial Statements the results of operations and financial position of all voting interest entities ("VOE") in which the Company has a controlling financial interest and all variable interest entities ("VIE") in which the Company is considered to be the primary beneficiary. The consolidation assessment, including the determination as to whether an entity qualifies as a VIE or VOE, depends on the facts and circumstances surrounding each entity. During the fourth quarter of 2015, the Company early adopted Accounting Standards Update ("ASU") 2015-02, “Consolidation (Topic 810) Amendments to the Consolidation Analysis” issued by the United States Financial Accounting Standards Board (“FASB”), which changed the method in which the Company determines whether entities are consolidated by the Company. The adoption of this amended accounting guidance was implemented utilizing a full retrospective application for all periods presented in the Company's Consolidated Financial Statements. The amended guidance includes changes in the identification of the primary beneficiary of investment companies considered to be VIEs. These changes resulted in the Company concluding that it is considered to be the primary beneficiary of the AlphaCat sidecars, the AlphaCat ILS funds and the BetaCat ILS funds and therefore the Company is required to consolidate these entities. The adoption of the amended guidance also resulted in the Company concluding that it was no longer required to consolidate PaCRe Ltd. ("PaCRe") due to the change in the VIE definition of "kick-out" rights under the amended guidance. The cumulative effect of these changes on the Company's retained earnings through the six months ended June 30, 2015 was a gain of $405. The following tables present the impact of the application of the amended accounting guidance on the Company's Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2015 and Consolidated Statement of Cash Flows for the six months ended June 30, 2015:
In the opinion of management, these Consolidated Financial Statements reflect all adjustments (including normal recurring adjustments) considered necessary for a fair statement of the Company's financial position and results of operations as at the end of and for the periods presented. All significant intercompany accounts and transactions have been eliminated. The results of operations for any interim period are not necessarily indicative of the results for a full year. The preparation of these financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. While management believes that the amounts included in the Consolidated Financial Statements reflect its best estimates and assumptions, actual results could differ materially from those estimates. The Company’s principal estimates include: •reserve for losses and loss expenses; •premium estimates for business written on a line slip or proportional basis; •the valuation of goodwill and intangible assets; •reinsurance recoverable balances including the provision for uncollectible amounts; and •investment valuation of financial assets. The term “ASC” used in these notes refers to Accounting Standard Codification issued by the FASB. |
Recent accounting pronouncements |
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Jun. 30, 2016 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent accounting pronouncements | Recent accounting pronouncements Recently Issued Accounting Standards Not Yet Adopted In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” (ASU 2014-09). The guidance in this ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards (for example, insurance contracts or lease contracts). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In March and April 2016, the FASB issued ASU 2016-08, “Revenue from Contracts with Customers (Topic 606) - Principal versus Agent Considerations (Reporting Revenue Gross versus Net)” and ASU 2016-10, “Revenue from Contracts with Customers (Topic 606) - Identifying Performance Obligations and Licensing”. The amendments in these ASU's clarify the implementation guidance within ASU 2014-09 on principal versus agent considerations and the aspects of identifying performance obligations, respectively, while retaining the related principals in those areas. In May 2016, the FASB issued ASU 2016-12, “Revenue from Contracts with Customers (Topic 606) - Narrow-Scope Improvements and Practical Expedients”. The amendments in this ASU do not change the core principle of the guidance in Topic 606. Rather, the amendments provide clarifying guidance in a few narrow areas and add practical expedients to reduce the potential for diversity in practice as well as the cost and complexity of applying the guidance. The original effective date for the amendments in ASU 2014-09 was for annual reporting periods beginning after December 15, 2016; however, in August 2015, the FASB delayed the effective date by one year through the issuance of ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date”. As such, the new effective date is for interim and annual reporting periods beginning after December 15, 2017. Entities may adopt the standard as of the original effective date; however, earlier adoption is not permitted. The Company is currently evaluating the impact of this guidance on the Company’s Consolidated Financial Statements. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)”. The amendments in this ASU increase the transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and requiring the disclosure of key information about leasing arrangements. The amendments in this ASU are effective for interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on the Company’s Consolidated Financial Statements. In March 2016, the FASB issued ASU 2016-09, “Compensation-Stock Compensation (Topic 718) - Improvements to Employee Share-Based Payment Accounting”. The amendments in this ASU simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The amendments in this ASU are effective for interim and annual reporting periods beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on the Company’s Consolidated Financial Statements. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326)”. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. This guidance is effective for annual periods beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted for annual periods beginning after December 15, 2018, and interim periods within those fiscal years. The Company is currently evaluating the impact of this guidance on the Company’s Consolidated Financial Statements. |
Investments |
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Investments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments | Investments During the fourth quarter of 2015, the Company enhanced disclosures around the allocation of invested assets and the related returns between managed and non-managed investments. Managed investments represent assets governed by the Company’s investment policy statement (“IPS”), whereas non-managed investments represent assets held in support of consolidated AlphaCat VIEs which are not governed by the Company’s IPS. Refer to Note 5, "Variable interest entities," for further details. As such, prior period disclosures have been revised to conform to current period presentation. The Company classifies its fixed maturity and short-term investments as trading and accounts for its other investments in accordance with U.S. GAAP guidance for "Financial Instruments." As such, all investments are carried at fair value with interest and dividend income and realized and unrealized gains and losses included in net income for the period. The amortized cost (or cost), gross unrealized gains and (losses) and fair value of the Company's investments as at June 30, 2016 were as follows:
The amortized cost (or cost), gross unrealized gains and (losses) and fair value of the Company's investments as at December 31, 2015 were as follows:
The following table sets forth certain information regarding the investment ratings of the Company’s fixed maturity investments as at June 30, 2016 and December 31, 2015.
The amortized cost and fair value amounts for the Company's fixed maturity investments held at June 30, 2016 and December 31, 2015 are shown below by contractual maturity. Actual maturity may differ from contractual maturity because certain borrowers may have the right to call or prepay certain obligations with or without call or prepayment penalties.
The following tables set forth certain information regarding the Company's other investment portfolio as at June 30, 2016 and December 31, 2015:
Other investments include alternative investments in various funds and pooled investment schemes. These alternative investments employ various investment strategies primarily involving, but not limited to, investments in collateralized obligations, fixed income securities, private equities, distressed debt and equity securities. Certain securities included in other investments are subject to redemption restrictions and are unable to be redeemed from the funds. Distributions from these funds will be received as the underlying investments of the funds are liquidated. Currently, it is not known to the Company when these underlying assets will be sold by their investment managers; however, it is estimated that the majority of the underlying assets of the investments would liquidate over five to ten years from inception of the funds. In addition, one of the investment funds with a fair value of $171,187 (December 31, 2015: $167,910), has a lock-up period of three years as at June 30, 2016 and may also impose a redemption gate. A lock-up period refers to the initial amount of time an investor is contractually required to remain invested before having the ability to redeem. Typically, the imposition of a gate delays a portion of the requested redemption, with the remaining portion settled in cash shortly after the redemption date. Furthermore, the underlying investments held in the overseas deposit funds are liquid and will generally trade freely in an open market. However, the Company's ability to withdraw from the overseas deposit funds is restricted by an annual and quarterly funding and release process for Lloyd's market participants. The Company's maximum exposure to any of these alternative investments is limited to the amount invested and any remaining capital commitments. Refer to Note 15, "Commitments and contingencies," for further details. As at June 30, 2016, the Company does not have any plans to sell any of the other investments listed above. (c)Net investment income Net investment income was derived from the following sources:
Managed net investment income from other investments includes distributed and undistributed net income from certain investment funds.
The following represents an analysis of net realized gains and the change in net unrealized gains (losses) on investments:
The following tables outline investments and cash pledged as collateral under the Company's credit facilities. For further details on the credit facilities, please refer to Note 13, “Debt and financing arrangements.”
In addition, $4,687,599 of cash and cash equivalents, restricted cash, short-term investments and fixed maturity investments were pledged during the normal course of business as at June 30, 2016 (December 31, 2015: $4,056,788). Of those, $4,564,394 were held in trust (December 31, 2015: $4,007,215). Pledged assets are generally for the benefit of the Company's cedants and policyholders, to support AlphaCat's fully collateralized reinsurance transactions and to facilitate the accreditation of Validus Reinsurance, Ltd., Validus Reinsurance (Switzerland) Ltd. ("Validus Re Swiss") and Talbot as an alien insurer/reinsurer by certain regulators. During December 2014, Validus Reinsurance, Ltd. established a Multi-Beneficiary Reinsurance Trust ("MBRT") to collateralize its (re)insurance liabilities associated with and for the benefit of U.S. domiciled cedants, and was approved as a trusteed reinsurer in the State of New Jersey. As a result, cedants domiciled in that state will receive automatic credit in their regulatory filings for the reinsurance provided prospectively by the Company. As of June 30, 2016, Validus Reinsurance, Ltd. was approved as a trusteed reinsurer in 48 states as well as Puerto Rico and the District of Columbia. In addition, Validus Re Swiss established a MBRT in December 2015 and was approved as a trusteed reinsurer in 9 states as at June 30, 2016. |
Fair value measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value measurements | Fair value measurements
Fair value is defined as the price to sell an asset or transfer a liability in an orderly transaction between market participants. Under U.S. GAAP, a company must determine the appropriate level in the fair value hierarchy for each fair value measurement. The fair value hierarchy prioritizes the inputs, which refer broadly to assumptions market participants would use in pricing an asset or liability, into three levels. It gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The level in the fair value hierarchy within which a fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The three levels of the fair value hierarchy are described below: Level 1 - Fair values are measured based on unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access. Level 2 - Fair values are measured based on quoted prices in active markets for similar assets or liabilities, quoted prices for identical assets or liabilities in inactive markets, or for which significant inputs are observable (e.g., interest rates, yield curves, prepayment speeds, default rates, loss severities, etc.) or can be corroborated by observable market data. Level 3 - Fair values are measured based on inputs that are unobservable and significant to the overall fair value measurement. The unobservable inputs reflect the Company's own judgments about assumptions where there is little, if any, market activity for that asset or liability that market participants might use. The availability of observable inputs can vary from financial instrument to financial instrument and is affected by a wide variety of factors including, for example, the type of financial instrument, whether the financial instrument is new and not yet established in the marketplace, and other characteristics particular to the instrument. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires significantly more judgment. Accordingly, the degree of judgment exercised by management in determining fair value is greatest for instruments categorized in Level 3. In periods of market dislocation, the observability of prices and inputs may be reduced for many instruments. This may lead the Company to change the selection of our valuation technique (for example, from market to cash flow approach) or to use multiple valuation techniques to estimate the fair value of a financial instrument. These circumstances could cause an instrument to be reclassified between levels within the fair value hierarchy. At June 30, 2016, the Company’s investments were allocated between Levels 1, 2 and 3 as follows:
At December 31, 2015, the Company’s investments were allocated between Levels 1, 2 and 3 as follows:
At June 30, 2016, managed Level 3 investments totaled $255,531 (December 31, 2015: $232,337), representing 4.3% (December 31, 2015: 3.9%) of total managed investments.
There have been no material changes in the Company's valuation techniques during the period, or periods, represented by these Consolidated Financial Statements. The following methods and assumptions were used in estimating the fair value of each class of financial instrument recorded in the Consolidated Balance Sheets. Fixed maturity investments In general, valuation of the Company's fixed maturity investment portfolio is provided by pricing services, such as index providers and pricing vendors, as well as broker quotations. The pricing vendors provide valuations for a high volume of liquid securities that are actively traded. For securities that do not trade on an exchange, the pricing services generally utilize market data and other observable inputs in matrix pricing models to determine month end prices. Prices are generally verified using third party data. Securities which are priced by an index provider are generally included in the index. In general, broker-dealers value securities through their trading desks based on observable inputs. The methodologies include mapping securities based on trade data, bids or offers, observed spreads, and performance on newly issued securities. Broker-dealers also determine valuations by observing secondary trading of similar securities. Prices obtained from broker quotations are considered non-binding, however they are based on observable inputs and by observing secondary trading of similar securities obtained from active, non-distressed markets. The Company considers these Level 2 inputs as they are corroborated with other market observable inputs. The techniques generally used to determine the fair value of the Company's fixed maturity investments are detailed below by asset class. U.S. government and government agency U.S. government and government agency securities consist primarily of debt securities issued by the U.S. Treasury and mortgage pass-through agencies such as the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation and the Government National Mortgage Association. Fixed maturity investments included in U.S. government and government agency securities are primarily priced by pricing services. When evaluating these securities, the pricing services gather information from market sources and integrate other observations from markets and sector news. Evaluations are updated by obtaining broker dealer quotes and other market information including actual trade volumes, when available. The fair value of each security is individually computed using analytical models which incorporate option adjusted spreads and other daily interest rate data. As the significant inputs used to price these securities are observable, the fair value of these investments are classified as Level 2. Non-U.S. government and government agency Non-U.S. government and government agency securities consist of debt securities issued by non-U.S. governments and their agencies along with supranational organizations (also known as sovereign debt securities). Securities held in these sectors are primarily priced by pricing services who employ proprietary discounted cash flow models to value the securities. Key quantitative inputs for these models are daily observed benchmark curves for treasury, swap and high issuance credits. The pricing services then apply a credit spread for each security which is developed by in-depth and real time market analysis. For securities in which trade volume is low, the pricing services utilize data from more frequently traded securities with similar attributes. These models may also be supplemented by daily market and credit research for international markets. As the significant inputs used to price these securities are observable, the fair value of these investments are classified as Level 2. U.S. states, municipalities and political subdivisions The Company's U.S. states, municipalities and political subdivisions portfolio contains debt securities issued by U.S. domiciled state and municipal entities. These securities are generally priced by independent pricing services using the techniques described for U.S. government and government agency securities described above. As the significant inputs used to price these securities are observable, the fair value of these investments are classified as Level 2. Agency residential mortgage-backed securities The Company's agency residential mortgage-backed investments are primarily priced by pricing services using a mortgage pool specific model which utilizes daily inputs from the active to be announced (“TBA”) market which is very liquid, as well as the U.S. treasury market. The model also utilizes additional information, such as the weighted average maturity, weighted average coupon and other available pool level data which is provided by the sponsoring agency. Valuations are also corroborated with daily active market quotes. As the significant inputs used to price these securities are observable, the fair value of these investments are classified as Level 2. Non-agency residential mortgage-backed securities The Company's non-agency mortgage-backed investments include non-agency prime residential mortgage-backed fixed maturity investments. The Company has no fixed maturity investments classified as sub-prime held in its fixed maturity investments portfolio. Securities held in these sectors are primarily priced by pricing services using an option adjusted spread model or other relevant models, which principally utilize inputs including benchmark yields, available trade information or broker quotes, and issuer spreads. The pricing services also review collateral prepayment speeds, loss severity and delinquencies among other collateral performance indicators for the securities valuation, when applicable. As the significant inputs used to price these securities are observable, the fair value of these investments are classified as Level 2. U.S. corporate Corporate debt securities consist primarily of investment-grade debt of a wide variety of U.S. corporate issuers and industries. The Company's corporate fixed maturity investments are primarily priced by pricing services. When evaluating these securities, the pricing services gather information from market sources regarding the issuer of the security and obtain credit data, as well as other observations, from markets and sector news. Evaluations are updated by obtaining broker dealer quotes and other market information including actual trade volumes, when available. The pricing services also consider the specific terms and conditions of the securities, including any specific features which may influence risk. In certain instances, securities are individually evaluated using a spread which is added to the U.S. treasury curve or a security specific swap curve as appropriate. As the significant inputs used to price these securities are observable, the fair value of these investments are classified as Level 2. Non-U.S. corporate Non-U.S. corporate debt securities consist primarily of investment-grade debt of a wide variety of non-U.S. corporate issuers and industries. The Company's non-U.S. corporate fixed maturity investments are primarily priced by pricing services. When evaluating these securities, the pricing services gather information from market sources regarding the issuer of the security and obtain credit data, as well as other observations, from markets and sector news. Evaluations are updated by obtaining broker dealer quotes and other market information including actual trade volumes, when available. The pricing services also consider the specific terms and conditions of the securities, including any specific features which may influence risk. As the significant inputs used to price these securities are observable, the fair value of these investments are classified as Level 2. Bank loans The Company's bank loan investments consist primarily of below-investment-grade debt of a wide variety of corporate issuers and industries. The Company's bank loans are primarily priced by pricing services. When evaluating these securities, the pricing services gather information from market sources regarding the issuer of the security and obtain credit data, as well as other observations, from markets and sector news. Evaluations are updated by obtaining broker dealer quotes and other market information including actual trade volumes, when available. The pricing services also consider the specific terms and conditions of the securities, including any specific features which may influence risk. As the significant inputs used to price these securities are observable, the fair value of these investments are classified as Level 2. Also, included in the bank loan portfolio is a collection of loan participations held through an intermediary. A third party pricing service provides monthly valuation reports for each loan and participation using a combination of quotations from loan pricing services, leveraged loan indices or market price quotes obtained directly from the intermediary. Significant unobservable inputs used to price these securities include credit spreads and default rates; therefore, the fair value of these investments are classified as Level 3. Asset-backed securities Asset backed securities include mostly investment-grade debt securities backed by pools of loans with a variety of underlying collateral, including automobile loan receivables, student loans, credit card receivables, and collateralized loan obligations originated by a variety of financial institutions. Securities held in these sectors are primarily priced by pricing services. The pricing services apply dealer quotes and other available trade information such as bids and offers, prepayment speeds which may be adjusted for the underlying collateral or current price data, the U.S. treasury curve and swap curve as well as cash settlement. The pricing services determine the expected cash flows for each security held in this sector using historical prepayment and default projections for the underlying collateral and current market data. In addition, a spread is applied to the relevant benchmark and used to discount the cash flows noted above to determine the fair value of the securities held in this sector. As the significant inputs used to price these securities are observable, the fair value of these investments are classified as Level 2. Where pricing is unavailable from pricing services, we obtain non-binding quotes from broker-dealers. This is generally the case when there is a low volume of trading activity and current transactions are not orderly. Broker-dealer quotes for which significant observable inputs are unable to be corroborated with market observable information are classified as Level 3. Commercial mortgage-backed securities Commercial mortgage backed securities are investment-grade debt primarily priced by pricing services. The pricing services apply dealer quotes and other available trade information such as bids and offers, prepayment speeds which may be adjusted for the underlying collateral or current price data, the U.S. treasury curve and swap curve as well as cash settlement. The pricing services determine the expected cash flows for each security held in this sector using historical prepayment and default projections for the underlying collateral and current market data. In addition, a spread is applied to the relevant benchmark and used to discount the cash flows noted above to determine the fair value of the securities held in this sector. As the significant inputs used to price these securities are observable, the fair value of these investments are classified as Level 2. Catastrophe bonds Catastrophe bonds are priced based on broker or underwriter bid indications. As the significant inputs used to price these securities are observable, the fair value of these investments are classified as Level 2. To the extent that these indications are based on significant unobservable inputs, the fair value of the relevant bonds will be classified as a Level 3. Short-term investments Short-term investments consist primarily of highly liquid securities, all with maturities of less than one year from the date of purchase. The fair value of the portfolio is generally determined using amortized cost which approximates fair value. As the highly liquid money market-type funds are actively traded, the fair value of these investments are classified as Level 1. To the extent that the remaining securities are not actively traded due to their approaching maturity, the fair value of these investments are classified as Level 2. Other investments Fund of hedge funds The fund of hedge funds includes a side pocket. While a redemption request has been submitted, the timing of receipt of proceeds on the side pocket is unknown. The fund's administrator provides a monthly reported NAV with a three month delay in its valuation. The fund manager has provided an estimate of the fund NAV at each period end based on the estimated performance provided from the underlying funds. To determine the reasonableness of the estimated NAV, the Company compares the fund administrator's NAV to the fund manager's estimated NAV that incorporates relevant valuation sources on a timely basis. Material variances are recorded in the current reporting period while immaterial variances are recorded in the following reporting period. The fair value of these investments are measured using the NAV practical expedient and therefore have not been categorized within the fair value hierarchy. Hedge funds The hedge funds consist of one investment assumed in the acquisition of Flagstone Reinsurance Holdings, S.A. ("Flagstone") (the "Flagstone hedge fund"). The Flagstone hedge fund's administrator provides quarterly NAVs with a three month delay in valuation. The fair value of this investment is measured using the NAV practical expedient and therefore has not been categorized within the fair value hierarchy. Private equity investments The private equity funds provide quarterly or semi-annual partnership capital statements with a three or six month delay which are used as a basis for valuation. These private equity investments vary in investment strategies and are not actively traded in any open markets. The fair value of these investments are measured using the NAV practical expedient and therefore have not been categorized within the fair value hierarchy. Investment funds Investment funds consist of one pooled investment, two structured securities funds and a mezzanine debt fund. The pooled investment is invested in fixed income securities with high credit ratings and is only open to Lloyd’s Trust Fund participants. The fair value of units in the investment fund is based on the NAV of the fund as reported by Lloyd’s Treasury & Investment Management. As the fund NAV is published, the fair value of this investment is classified as Level 2. The structured securities funds invest across asset backed, residential mortgage backed and commercial mortgage backed securities, whereas the mezzanine debt fund invests in a portfolio of mezzanine securities which generally take the form of private debt securities with equity participation in connection with buyouts, recapitalizations and refinancings. The fair value of units in each fund is based on the NAV of the respective fund as reported by the independent fund administrator. The NAV for each fund is reported on a one or three month delay by the fund's administrator. The fair value of these investments are measured using the NAV practical expedient and therefore have not been categorized within the fair value hierarchy. Overseas deposits The Company's share of a portfolio of Lloyd's overseas deposits are managed centrally by Lloyd's and invested according to local regulatory requirements. The composition of the portfolio varies and the deposits are made across the market. The fair value of the deposits is based on the portfolio level reporting that is provided by Lloyd's. The fair value of these investments are measured using the NAV practical expedient and therefore have not been categorized within the fair value hierarchy. Mutual funds Mutual funds consist of two investment funds which are invested in various quoted investments. The fair value of units in the mutual funds are based on the NAV of the funds as reported by the fund manager. As the NAVs for each fund are published, the fair value of these investments are classified as Level 2.
The following table presents a reconciliation of the beginning and ending balances for all investments measured at fair value on a recurring basis using Level 3 inputs during the three and six months ended June 30, 2016 and 2015:
There have not been any transfers into or out of Level 3 during the three and six months ended June 30, 2016 or 2015, respectively. |
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Variable Interest Entities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Variable Interest Entity Disclosure [Text Block] | Variable interest entities The Company consolidates all VOEs in which it has a controlling financial interest and all VIEs in which it is considered to be the primary beneficiary. The Company’s VIEs primarily include entities related to the AlphaCat segment.
AlphaCat sidecars Beginning on May 25, 2011, the Company joined with other investors in capitalizing a series of sidecars for the purpose of investing in collateralized reinsurance and retrocessional contracts. Certain of these sidecars deployed their capital through transactions entered into by AlphaCat Reinsurance Ltd. (“AlphaCat Re”). Each of these entities return capital once the risk period expires and all losses have been paid out. The AlphaCat sidecars are VIEs and are consolidated by the Company as the primary beneficiary. The Company's maximum exposure to any of the sidecars is the amount of capital invested at any given time and any remaining capital commitments. AlphaCat ILS funds The AlphaCat ILS funds received third party subscriptions beginning on December 17, 2012. The Company and other investors invest in the AlphaCat ILS funds for the purpose of investing in instruments with returns linked to property catastrophe reinsurance, retrocession and insurance linked securities (“ILS”) contracts. The AlphaCat ILS funds have varying risk profiles and are categorized by the expected loss of the fund. Expected loss represents the average annual loss over the set of simulation scenarios divided by the total limit. Lower risk ILS funds are defined as having a maximum permitted portfolio expected loss of less than 7%, whereas higher risk ILS funds have a maximum permitted portfolio expected loss of greater than 7%. The AlphaCat ILS funds primarily deploy their capital through transactions entered into by AlphaCat Re and AlphaCat Master Fund Ltd. (“AlphaCat Master Fund”). The AlphaCat ILS funds are VIEs and are consolidated by the Company as the primary beneficiary. The Company's maximum exposure to any of the funds is the amount of capital invested at any given time and any remaining capital commitments. Refer to Note 15, "Commitments and contingencies," for further details. AlphaCat Re and AlphaCat Master Fund The Company utilizes AlphaCat Re and AlphaCat Master Fund (collectively the “master funds”), both market facing entities, for the purpose of writing collateralized reinsurance and investing in capital markets products, respectively, on behalf of certain entities within the AlphaCat segment and direct third party investors. AlphaCat Re enters into transactions on behalf of the AlphaCat sidecars and ILS funds (collectively the “feeder funds”) and direct third party investors, whereas AlphaCat Master Fund only enters into transactions on behalf of certain AlphaCat ILS funds. All of the risks and rewards of the underlying transactions are allocated to the feeder funds and direct third party investors using variable funding notes. The master funds are VIEs and are consolidated by the Company as the primary beneficiary. Notes Payable to AlphaCat Investors The master funds issue variable funding notes to the feeder funds, and direct to third party investors, in order to write collateralized reinsurance and invest in capital markets products on their behalf. The Company’s investments in the feeder funds, together with investments made by third parties in the feeder funds and on a direct basis, are provided as consideration for the notes to the master funds. The duration of the underlying collateralized reinsurance contracts and capital market products is typically twelve months; however, the variable funding notes do not have a stated maturity date or principal amount since repayment is dependent on the settlement and income or loss of the underlying transactions. Therefore, the notes are subsequently redeemed as the underlying transactions are settled. The income or loss generated by the underlying transactions is then transferred to the feeder funds and direct third party investors via the variable funding notes. As both the master and feeder funds are consolidated by the Company, any notes issued by the master funds to the feeder funds are eliminated on consolidation and only variable funding notes issued by AlphaCat Re to direct third party investors remain on the Consolidated Balance Sheets as notes payable to AlphaCat investors with the related income or loss included in the Consolidated Statements of Comprehensive Income as (income) loss attributable to AlphaCat investors. To the extent that the (income) loss has not been returned to the investors, it is included in accounts payable and accrued expenses in the Consolidated Balance Sheets. During the six months ended June 30, 2016, one of the AlphaCat ILS funds issued both common shares and structured notes to the Company and other third party investors in order to capitalize the fund. The fund deploys its capital through AlphaCat Re; therefore, the structured notes do not have a stated maturity date or principal amount since repayment is dependent on the settlement and income or loss of the variable funding notes with AlphaCat Re. The structured notes rank senior to the common shares and earn an interest rate of 8.0% per annum, payable on a cumulative basis in arrears. As the fund is consolidated by the Company, the structured notes issued to the Company are eliminated on consolidation and only the structured notes issued to third party investors remain on the Consolidated Balance Sheets as notes payable to AlphaCat investors with any related interest included in the Consolidated Statements of Comprehensive Income as (income) loss attributable to AlphaCat investors. To the extent that the accrued interest on the structured notes has not been returned to the investors, it is included in accounts payable and accrued expenses in the Consolidated Balance Sheets. The following table presents a reconciliation of the beginning and ending notes payable to AlphaCat investors for the three and six months ended June 30, 2016:
The income attributable to AlphaCat investors was $6,114 and $10,714 for the three and six months ended June 30, 2016, respectively, with $13,126 included in accounts payable and accrued expenses as at June 30, 2016 (December 31, 2015: $2,412). BetaCat ILS funds The BetaCat ILS funds invest exclusively in catastrophe bonds (principal-at-risk variable rate notes and other event-linked securities, being referred to collectively as “Cat Bonds”) focused on property and casualty risk issued under Rule 144A of the Securities Act of 1933, as amended, following a passive buy-and-hold investment strategy. One of the funds is a VIE and is consolidated by the Company as it is the primary beneficiary. The remaining funds are VOEs and are consolidated by the Company as it owns all of the voting equity interests. The Company's maximum exposure to any of the funds is the amount of capital invested at any given time. The following table presents the total assets and total liabilities of the Company’s consolidated VIEs, excluding intercompany eliminations, as at June 30, 2016 and December 31, 2015:
Assets of consolidated VIEs can only be used to settle obligations and liabilities of the consolidated VIEs and do not have recourse to the general credit of the Company. Investments held by these entities are presented separately in Note 3, "Investments," as non-managed investments.
The Company invests in private equity and other investment vehicles as part of the Company's investment portfolio. The activities of these VIEs are generally limited to holding investments and the Company's involvement in these entities is passive in nature. The Company's maximum exposure to the VIEs is the amount of capital invested at any given time, and the Company does not have the power to direct the activities which most significantly impact the VIEs economic performance. The Company is therefore not the primary beneficiary of these VIEs. |
Investments in affiliates |
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Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments in affiliates | Investments in affiliates The following table presents the Company's investments in affiliates as at June 30, 2016 and December 31, 2015:
Aquiline Financial Services Fund II L.P. On December 20, 2011, the Company entered into an Assignment and Assumption Agreement (the "Agreement") with Aquiline Capital Partners LLC, a Delaware limited liability company ("Aquiline Capital") and Aquiline Capital Partners II GP (Offshore) Ltd., a Cayman Islands company limited by shares (the "Aquiline II General Partner") pursuant to which the Company has assumed 100% of Aquiline Capital's interest in Aquiline Financial Services Fund II L.P. (the "Aquiline II Partnership") representing a total capital commitment of $50,000 (the "Aquiline II Commitment"), as a limited partner in the Partnership (the "Transferred Interest"). The Transferred Interest is governed by the terms of an Amended and Restated Exempted Limited Partnership Agreement of the Fund dated January 9, 2013 (the "Aquiline II Limited Partnership Agreement"). On October 2, 2014, the Company assumed an additional investment in the Aquiline II Partnership as part of the Western World acquisition representing a total capital commitment of $10,000. This interest is also governed by the terms of the Aquiline II Limited Partnership Agreement. The Aquiline II Partnership is a VIE and the Company is not the primary beneficiary. Therefore, the Company's investment in the Aquiline II Partnership has been treated as an equity method investment. The Aquiline II Partnership provides a quarterly capital account statement, with a three month delay in its valuation, which was used as the basis for calculating the Company's share of the Aquiline II Partnership income for the period. In accordance with the terms of the Agreement, no limited partner has the right to withdraw from the Aquiline II Partnership or to withdraw any part of its capital account without prior consent from the Aquiline II General Partner. The Company's maximum exposure to the Aquiline II Partnership is limited to the amount invested and any remaining capital commitment. Refer to Note 15, "Commitments and contingencies," for further details. Aquiline Financial Services Fund III L.P. On November 7, 2014, the Company, entered into a Subscription Agreement (the "Subscription Agreement") with Aquiline Capital Partners III GP (Offshore) Ltd., a Cayman Islands company limited by shares (the "Aquiline III General Partner") pursuant to which the Company committed and agreed to purchase limited partnership or other comparable limited liability equity interests (the "Limited Partnership Interests") in Aquiline Financial Services Fund III L.P., a Cayman Islands exempted limited partnership (the "Aquiline III Partnership"), and/or one or more Alternative Investment Vehicles and Intermediate Entities (together with the Aquiline III Partnership, the "Aquiline Fund" or the "Entities") with a capital commitment (the "Aquiline III Commitment") in an amount equal to $100,000, as a limited partner in the Aquiline III Partnership. The Limited Partnership Interests are governed by the terms of an Amended and Restated Exempted Limited Partnership Agreement dated as of November 7, 2014 (the “Aquiline III Limited Partnership Agreement”). The Aquiline III Partnership is a VIE and the Company is not the primary beneficiary. Therefore, the Company's investment in the Aquiline III Partnership has been treated as an equity method investment. The Aquiline III Partnership provides a quarterly capital account statement, with a three month delay in its valuation, which was used as the basis for calculating the Company's share of Aquiline III Partnership income for the period. In accordance with the terms of the Agreement, no limited partner has the right to withdraw from the Aquiline III Partnership or to withdraw any part of its capital account without prior consent from the Aquiline III General Partner. The Company's maximum exposure to the Aquiline III Partnership is limited to the amount invested and any remaining capital commitment. Refer to Note 15, "Commitments and contingencies," for further details. The following table presents a reconciliation of the beginning and ending investment in the Company's investment affiliate balance for the three and six months ended June 30, 2016 and 2015:
The following table presents the Company’s investment in the partnerships as at June 30, 2016:
The following table presents the Company’s investment in the partnerships as at December 31, 2015:
PaCRe, Ltd. On April 2, 2012, the Company joined with other investors in capitalizing PaCRe, a Class 4 Bermuda reinsurer formed for the purpose of writing high excess property catastrophe reinsurance. However, during the fourth quarter of 2015, PaCRe's Class 4 license was surrendered and the company was considered off-risk effective January 1, 2016. The Company's investment in PaCRe has been treated as an equity method investment. The Company's maximum exposure to the fund is the amount of capital invested at any given time. The following table presents a reconciliation of the beginning and ending investment in the Company's operating affiliate balance for the three and six months ended June 30, 2016 and 2015:
The following table presents the Company’s investment in PaCRe as at June 30, 2016:
The following table presents the Company’s investment in PaCRe as at December 31, 2015:
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Noncontrolling interest |
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Noncontrolling Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Noncontrolling interest | Noncontrolling interest Investors in certain of the AlphaCat ILS funds have rights that enable shareholders, subject to certain limitations, to redeem their shares. The third party equity is therefore recorded in the Company’s Consolidated Balance Sheets as redeemable noncontrolling interest. When and if a redemption notice is received, the fair value of the redemption is reclassified to a liability. The AlphaCat sidecars and one of the AlphaCat ILS funds have no shareholder redemption rights. Therefore, the third party equity is recorded in the Company's Consolidated Balance Sheets as noncontrolling interest. The following tables present a reconciliation of the beginning and ending balances of redeemable noncontrolling interest and noncontrolling interest for the three and six months ended June 30, 2016 and 2015:
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Derivative instruments |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative instruments | Derivative instruments The Company enters into derivative instruments for risk management purposes, specifically to hedge unmatched foreign currency exposures and interest rate exposures. As at June 30, 2016 and December 31, 2015, the Company held foreign currency forward contracts to mitigate the risk of fluctuations in the U.S. dollar against a number of foreign currencies. In addition, the Company held two interest rate swaps to fix the payment of interest on the Company's 2006 and 2007 Junior Subordinated Deferrable Debentures, as well as three interest rate swaps and one cross-currency interest rate swap to fix the payment of interest and mitigate the foreign exchange rate impact on Flagstone's 2006 and 2007 Junior Subordinated Deferrable Debentures. As at June 30, 2016 and December 31, 2015, none of the Company's foreign currency forward contracts were designated as hedging instruments for accounting purposes. The following table summarizes information on the classification and amount of the fair value of derivatives not designated as hedging instruments for accounting purposes on the Consolidated Balance Sheets as at June 30, 2016 and December 31, 2015:
The following table summarizes information on the classification and amount of the fair value of derivatives designated as hedging instruments for accounting purposes on the Consolidated Balance Sheets as at June 30, 2016 and December 31, 2015:
As described in Note 4, "Fair value measurements," under U.S. GAAP, a company must determine the appropriate level in the fair value hierarchy for each fair value measurement. The assumptions used within the valuation of the Company's derivative instruments are observable in the marketplace, can be derived from observable data or are supported by observable levels at which other similar transactions are executed in the marketplace. Accordingly, these derivatives were classified within Level 2 of the fair value hierarchy.
The Company designates certain foreign currency derivative instruments as fair value hedges for accounting purposes and formally and contemporaneously documents all relationships between the derivative instruments and hedged items and links the derivative instruments to specific assets and liabilities. The Company assesses the effectiveness of these hedges, both at inception and on an on-going basis and determines whether the hedges are highly effective in offsetting changes in fair value of the linked hedged items. The following table provides the total impact on earnings, recognized in income within foreign exchange gains (losses), relating to the derivative instruments formally designated as fair value hedges for accounting purposes along with the impact of the related hedged items for the three and six months ended June 30, 2016 and 2015:
The Company designates its interest rate derivative instruments as cash flow hedges for accounting purposes and formally and contemporaneously documents all relationships between the hedging instruments and hedged items and links the derivative instruments to specific assets and liabilities. The Company assesses the effectiveness of the hedges, both at inception and on an on-going basis and determines whether the hedges are highly effective in offsetting changes in fair value of the linked hedged items. The Company currently applies the long haul method when assessing the hedge's effectiveness. The following table provides the total impact on other comprehensive income (loss) and earnings relating to the derivative instruments formally designated as cash flow hedges along with the impact of the related hedged items for the three and six months ended June 30, 2016 and 2015:
The above balances relate to interest payments and have therefore been classified as finance expenses in the Consolidated Statements of Comprehensive Income.
There was no balance sheet offsetting activity as at June 30, 2016 or December 31, 2015. The Company currently provides cash collateral as security for interest rate swap contracts. The Company does not provide cash collateral or financial instruments as security for foreign currency forward contracts. Our derivative instruments are generally traded under International Swaps and Derivatives Association master netting agreements, which establish terms that apply to all transactions. On a periodic basis, the amounts receivable from or payable to the counterparties are settled in cash. The Company has not elected to settle multiple transactions with an individual counterparty on a net basis. |
Reserve for losses and loss expenses |
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Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reserve for losses and loss expenses | Reserve for losses and loss expenses Reserves for losses and loss expenses are based in part upon the estimation of case reserves from broker, insured and ceding company reported data. The Company also uses statistical and actuarial methods to estimate ultimate expected losses and loss expenses, from which incurred but not reported losses can be calculated. The period of time from the occurrence of a loss to the reporting of a loss to the Company and to the settlement of the Company's liability may be several months or years. During this period, additional facts and trends may be revealed. As these factors become apparent, reserves will be adjusted, sometimes requiring an increase or decrease in the overall reserves of the Company, and at other times requiring a reallocation of incurred but not reported reserves ("IBNR") to specific case reserves. These estimates are reviewed and adjusted regularly, and such adjustments, if any, are reflected in earnings in the period in which they become known. While management believes that it has made a reasonable estimate of ultimate losses, there can be no assurances that ultimate losses and loss expenses will not exceed this estimate. The following table represents an analysis of paid and unpaid losses and loss expenses incurred and a reconciliation of the beginning and ending unpaid losses and loss expenses for the three and six months ended June 30, 2016 and 2015:
Incurred losses and loss expenses comprise:
The June 30, 2016 gross reserves for losses and loss expenses comprise reserves for reported claims of $1,267,625 (December 31, 2015: $1,278,697) and IBNR of $1,855,092 (December 31, 2015: $1,717,870). The net favorable development on prior years by segment and line of business for the three and six months ended June 30, 2016 and 2015 was as follows:
The net favorable development of $62.8 million for the three months ended June 30, 2016 was primarily due to favorable development on attritional losses and prior year event and non-event reserves. The Validus Re and Western World segments experienced favorable development on prior years primarily due to favorable development on attritional losses; whereas, the Talbot segment experienced favorable development on prior years primarily due to favorable development on event and non-event reserves.
The Validus Re segment experienced favorable development on prior years primarily due to favorable development on attritional losses; whereas, the Talbot segment experienced favorable development on prior years primarily due to favorable development on attritional losses and certain events, including the Thailand floods. The Western World segment experienced favorable development on prior years primarily due to the amortization of the fair value adjustment made at the acquisition date as well as favorable development on attritional losses.
The net favorable development of $116.5 million for the six months ended June 30, 2016 was primarily attributable to net favorable development in the Validus Re, Talbot and Western World segments. The Validus Re net favorable development was primarily attributable to favorable development on attritional losses or non-event reserves; whereas Talbot's favorable development was due to favorable development on attritional losses along with favorable development on prior year event reserves. Western World's net favorable development was attributable to favorable development on attritional losses.
The Validus Re segment experienced favorable development on prior years primarily due to favorable development on attritional losses; whereas, the Talbot segment experienced favorable development on prior years primarily due to favorable development on attritional losses and certain events, including the Thailand floods. The Western World segment experienced favorable development on prior years primarily due to the amortization of the fair value adjustment made at the acquisition date as well as favorable development on attritional losses. |
Reinsurance |
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Reinsurance Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance | Reinsurance The Company enters into reinsurance and retrocession agreements in order to mitigate its accumulation of loss, reduce its liability on individual risks, enable it to underwrite policies with higher limits and increase its aggregate capacity. The cession of insurance and reinsurance does not legally discharge the Company from its primary liability for the full amount of the policies, and the Company is required to pay the loss and bear collection risk if the reinsurer fails to meet its obligations under the reinsurance or retrocession agreement. Amounts recoverable from reinsurers are estimated in a manner consistent with the underlying liabilities. Credit risk The Company evaluates the financial condition of its reinsurers and monitors concentration of credit risk arising from its exposure to individual reinsurers. The reinsurance program is generally placed with reinsurers whose rating, at the time of placement, was A- or better as rated by Standard & Poor's or the equivalent with other rating agencies. Exposure to a single reinsurer is also controlled with restrictions dependent on rating. At June 30, 2016, 98.7% (December 31, 2015: 98.7%) of reinsurance recoverable (which includes loss reserves recoverable and recoverables on paid losses), inclusive of $291,536 of total IBNR recoverable (December 31, 2015: $214,863), were fully collateralized or from reinsurers rated A- or better. Reinsurance recoverable by reinsurer as at June 30, 2016 and December 31, 2015 were as follows:
At June 30, 2016 and December 31, 2015, the provision for uncollectible reinsurance relating to reinsurance recoverable was $5,025 and $4,997, respectively. To estimate this provision for uncollectible reinsurance, the reinsurance recoverable is first allocated to applicable reinsurers. This determination is based on a process rather than an estimate, although an element of judgment is applied, especially in relation to ceded IBNR. The Company then uses default factors to determine the portion of a reinsurer’s balance deemed to be uncollectible. Default factors require considerable judgment and are determined in part using the current rating, or rating equivalent, of each reinsurer as well as other key considerations and assumptions. |
Share capital |
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Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share capital | Share capital The Company is authorized to issue up to an aggregate of 571,428,571 common and preferred shares with a par value of $0.175 per share.
On June 13, 2016, the Company issued 6,000 shares of its 5.875% Non-Cumulative Preferred Shares, Series A (the "Series A Preferred Shares") (equivalent to 6,000,000 Depositary Shares, each of which represents a 1/1,000th interest in a Series A Preferred Share), $0.175 par value and $25,000 liquidation preference per share (equivalent to $25 per Depositary Share). The Series A Preferred Shares were registered and sold under the Securities Act of 1933, as amended, and were issued at a price to the public of $25,000 per share (equivalent to $25 per Depositary Share). After underwriting discounts and expenses, the Company received net proceeds of $144,852 which will be used for general corporate purposes. The Depositary Shares, representing the Series A Preferred Shares, are traded on the New York Stock Exchange under the symbol “VRPRA.” The Series A Preferred Shares have no stated maturity date and are redeemable, in whole or in part, at the Company’s option on and after June 15, 2021, at a redemption price of $25,000 per Series A Preferred Share (equivalent to $25 per Depositary Share), plus declared and unpaid dividends. The Company may also redeem all, but not less than all, of the Series A Preferred Shares before the redemption date at a redemption price of $26,000 per share (equivalent to $26 per Depositary Share), plus declared and unpaid dividends, if the Company is required to submit a proposal to the holders of the Series A Preferred Shares concerning an amalgamation, consolidation, merger or other similar corporate transaction or change in Bermuda law. The Series A Preferred Shares may also be redeemed before the redemption date at a redemption price of $25,000 per Series A Preferred Share (equivalent to $25 per Depositary Share), plus declared and unpaid dividends, in whole, if there is a change in tax law, or in whole or in part, in the case of a capital disqualification event. Dividends on the Series A Preferred Shares, when, as and if declared by the Company’s Board of Directors or a duly authorized committee thereof, will accrue and be payable on the liquidation preference amount from the original issue date, on a non-cumulative basis, quarterly in arrears on each dividend payment date at an annual rate of 5.875%. The Company will be restricted from paying dividends on and repurchasing its common shares, unless certain dividend payments are made on the Series A Preferred Shares. Upon any voluntary or involuntary liquidation, dissolution or winding up of the Company, holders of the Series A Preferred Shares and any parity shares are entitled to receive out of our assets available for distribution to shareholders, before any distribution is made to holders of common shares or other junior shares, a liquidating distribution in the amount of $25,000 per Series A Preferred Share (equivalent to $25 per Depositary Share) plus declared and unpaid dividends. Distributions will be made pro rata in accordance with the respective aggregate liquidation preferences of the Series A Preferred Shares and any parity shares and only to the extent of our assets, if any, that are available after satisfaction of all liabilities to creditors. Holders of the Series A Preferred Shares have no voting rights, except with respect to certain fundamental changes in the terms of the Series A Preferred Shares and in the case of certain dividend non-payments or as otherwise required by Bermuda law or the Company’s bye-laws. The following table is a summary of the Preferred shares issued and outstanding:
The holders of common shares are entitled to receive dividends and are allocated one vote per share, provided that, if the controlled shares of any shareholder or group of related shareholders constitute more than 9.09 percent of the outstanding common shares of the Company, their voting power will be reduced to 9.09 percent. The Company may from time to time repurchase its securities, including common shares, Junior Subordinated Deferrable Debentures and Senior Notes. On February 3, 2015, the Board of Directors of the Company approved an increase in the Company's common share purchase authorization to $750,000. This amount is in addition to the $2,274,401 of common shares repurchased by the Company through February 3, 2015 under its previously authorized share repurchase programs. The Company has repurchased 78,841,758 common shares for an aggregate purchase price of $2,620,814 from the inception of its share repurchase program to June 30, 2016. The Company had $403,587 remaining under its authorized share repurchase program as of June 30, 2016. The Company expects the purchases under its share repurchase program to be made from time to time in the open market or in privately negotiated transactions. The timing, form and amount of the share repurchases under the program will depend on a variety of factors, including market conditions, the Company’s capital position relative to internal and rating agency targets, legal requirements and other factors. The repurchase program may be modified, extended or terminated by the Board of Directors at any time. The following table is a summary of the common shares issued and outstanding:
On May 5, 2016, the Company announced a quarterly cash dividend of $0.35 (2015: $0.32) per common share. This dividend was paid on June 30, 2016 to holders of record on June 15, 2016. On February 2, 2016 the Company announced a quarterly cash dividend of $0.35 (2015: $0.32) per common share. This dividend was paid on March 31, 2016 to holders of record on March 15, 2016. |
Stock plans |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock plans | Stock plans
The Company’s Amended and Restated 2005 Long Term Incentive Plan (“LTIP”) provides for grants to employees of options, stock appreciation rights (“SARs”), restricted shares, restricted share units, performance shares, dividend equivalents or other share-based awards. The total number of shares reserved for issuance under the LTIP are 2,753,292 shares of which 1,256,215 shares remain available for issuance at June 30, 2016. The LTIP is administered by the Compensation Committee of the Board of Directors. No SARs have been granted to date. Grant prices are established at the fair market value of the Company’s common shares at the date of grant.
Options may be exercised for voting common shares upon vesting. Outstanding options have a life of 10 years and vest either pro rata or at the end of the required service period from the date of grant. Fair value of the option awards at the date of grant is determined using the Black-Scholes option-pricing model. Expected volatility is based on stock price volatility of comparable publicly-traded companies. The Company used the simplified method consistent with U.S. GAAP authoritative guidance on stock compensation expenses to estimate expected lives for options granted during the period as historical exercise data was not available and the options met the requirement as set out in the guidance. The Company has not granted any stock option awards since September 4, 2009. These stock option awards were fully amortized during the year ended December 31, 2012. Activity with respect to options for the six months ended June 30, 2016 was as follows:
Activity with respect to options for the six months ended June 30, 2015 was as follows:
Restricted shares granted under the LTIP vest either pro rata or at the end of the required service period and contain certain restrictions during the vesting period, relating to, among other things, forfeiture in the event of termination of employment and transferability. The Company recognized share compensation expenses during the three and six months ended June 30, 2016 of $9,517 (2015: $8,653) and $18,646 (2015:$17,132), respectively. The expenses represent the proportionate accrual of the fair value of each grant based on the remaining vesting period. Activity with respect to unvested restricted share awards for the six months ended June 30, 2016 was as follows:
Activity with respect to unvested restricted share awards for the six months ended June 30, 2015 was as follows:
At June 30, 2016, there were $76,049 (December 31, 2015: $69,143) of total unrecognized share compensation expenses in respect of restricted share awards that are expected to be recognized over a weighted-average period of 2.6 years (December 31, 2015: 2.4 years).
Restricted share units under the LTIP vest either ratably or at the end of the required service period and contain certain restrictions during the vesting period, relating to, among other things, forfeiture in the event of termination of employment and transferability. The Company recognized share compensation expenses during the three and six months ended June 30, 2016 of $377 (2015: $279) and $688 (2015: $541), respectively. The expenses represent the proportionate accrual of the fair value of each grant based on the remaining vesting period. Activity with respect to unvested restricted share units for the six months ended June 30, 2016 was as follows:
Activity with respect to unvested restricted share units for the six months ended June 30, 2015 was as follows:
At June 30, 2016, there were $3,079 (December 31, 2015: $2,790) of total unrecognized share compensation expenses in respect of restricted share units that are expected to be recognized over a weighted-average period of 2.7 years (December 31, 2015: 2.6 years).
The performance share awards contain a performance based component. The performance component relates to the compounded growth in the Dividend Adjusted Diluted Book Value per Share (“DBVPS”) over a three-year period relative to the Company's peer group. For performance share awards granted during the period, the grant date Diluted Book Value per Share is based on the DBVPS at the end of the most recent financial reporting year. The Dividend Adjusted Performance Period End DBVPS will be the DBVPS three years after the grant date DBVPS. The fair value estimate earns over the requisite attribution period and the estimate will be reassessed at the end of each performance period which will reflect any adjustments in the consolidated statements of comprehensive income in the period in which they are determined. The Company recognized share compensation expenses during the three and six months ended June 30, 2016 of $833 (2015: $310) and $2,630 (2015: $623), respectively. Activity with respect to unvested performance share awards for the six months ended June 30, 2016 was as follows:
Activity with respect to unvested performance share awards for the six months ended June 30, 2015 was as follows:
At June 30, 2016, there were $8,719 (December 31, 2015: $4,011) of total unrecognized share compensation expenses in respect of performance share awards that are expected to be recognized over a weighted-average period of 2.5 years (December 31, 2015: 2.1 years).
The breakdown of share compensation expenses by award type for the periods indicated was as follows:
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Debt and financing arrangements |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt and financing arrangements | Debt and financing arrangements
The financing structure at June 30, 2016 was as follows:
The financing structure at December 31, 2015 was as follows:
The following table summarizes the key terms of the Company's senior notes and junior subordinated deferrable debentures:
Senior Notes The Senior Notes due 2040 (the “2010 Senior Notes”) were part of a registered public offering. The 2010 Senior Notes mature on January 26, 2040. The Company may redeem the notes, in whole at any time, or in part from time to time, at the Company's option on not less than 30 nor more than 60 days’ notice, at a make-whole redemption price as described in “Description of the Notes - Optional Redemption” in the 2010 Senior Notes prospectus supplement. In addition, the Company may redeem the notes, in whole, but not in part, at any time upon the occurrence of certain tax events as described in “Description of the Notes - Redemption for Tax Purposes” in the prospectus supplement. Debt issuance costs are amortized to income over the life of the 2010 Senior Notes and are presented on a net basis within the senior notes payable balance in the Company's Consolidated Balance Sheets. There were no redemptions made during the three and six months ended June 30, 2016 and 2015. The 2010 Senior Notes are unsecured and unsubordinated obligations of the Company and rank equally in right of payment with all of the Company’s existing and future unsecured and unsubordinated indebtedness. The 2010 Senior Notes will be effectively junior to all of the Company’s future secured debt, to the extent of the value of the collateral securing such debt, and will rank senior to all our existing and future subordinated debt. The 2010 Senior Notes are structurally subordinated to all obligations of the Company’s subsidiaries. Future payments of principal of $250,000 on the 2010 Senior Notes are all expected to be after 2021. Junior subordinated deferrable debentures The Company participated in private placements of junior subordinated deferrable interest debentures due 2036 and 2037 (respectively, the “2006 Junior Subordinated Deferrable Debentures” and “2007 Junior Subordinated Deferrable Debentures”). Debt issuance costs for the 2006 and 2007 Junior Subordinated Deferrable Debentures were amortized to income over the five year optional redemption periods. They are redeemable at the Company's option at par. There were no redemptions made during the three and six months ended June 30, 2016 and 2015. As part of the acquisition of Flagstone, the Company assumed junior subordinated deferrable debentures due 2036 and 2037 (respectively, the “Flagstone 2006 Junior Subordinated Deferrable Debentures” and “Flagstone 2007 Junior Subordinated Deferrable Debentures”). These debentures are redeemable quarterly at par. There were no redemptions made during the three and six months ended June 30, 2016 and 2015. Future payments of principal of $537,987 on the debentures discussed above are all expected to be after 2021.
On December 9, 2015, the Company entered into a $85,000 five-year unsecured credit facility with various counterparties as co-documentation agents and the lenders party thereto, which provides for letter of credit and revolving credit availability for the Company (the “Five Year Unsecured Facility”) (the full $85,000 of which is available for letters of credit and/or revolving loans). The Five Year Unsecured Facility was provided by a syndicate of commercial banks. Letters of credit under the Five Year Unsecured Facility are available to support obligations in connection with the reinsurance business of the Company and its subsidiaries. Loans under the Five Year Unsecured Facility are available for the general corporate and working capital purposes of the Company. The Company may request that existing lenders under the Five Year Unsecured Facility or prospective additional lenders agree to make available additional commitments from time to time so long as the aggregate commitments under the Five Year Unsecured Facility do not exceed $150,000. Also on December 9, 2015, the Company entered into a $300,000 five-year secured credit facility, with the same parties, which provides for letter of credit availability for the Company (the “Five Year Secured Facility” and together with the Five Year Unsecured Facility, the “Credit Facilities”). The Five Year Secured Facility was also provided by a syndicate of commercial banks. Letters of credit under the Five Year Secured Facility will be available to support obligations in connection with the reinsurance business of the Company and its subsidiaries. The Company may request that existing lenders under the Five Year Secured Facility or prospective additional lenders agree to make available additional commitments from time to time so long as the aggregate commitments under the Five Year Secured Facility do not exceed $400,000. The obligations of the Company under the Five Year Secured Facility are secured by cash and securities deposited into cash collateral accounts from time to time with The Bank of New York Mellon. As of June 30, 2016, there was $nil outstanding under the Five Year Unsecured Facility and $105,575 in outstanding letters of credit under the Five Year Secured Facility. The Credit Facilities contain covenants that include, among other things (i) the requirement that the Company initially maintain a minimum level of consolidated net worth of at least $2,600,000 and, commencing with the end of the fiscal quarter ending June 30, 2015, to be increased quarterly by an amount equal to 25.0% of the Company’s consolidated net income (if positive) for such quarter plus 50.0% of the aggregate increases in the consolidated shareholders’ equity of the Company during such fiscal quarter by reason of the issuance and sale of common equity interests of the Company, including upon any conversion of debt securities of the Company into such equity interests, (ii) the requirement that the Company maintain at all times a consolidated total debt to consolidated total capital ratio not greater than 0.35:1.00, and (iii) the requirement that Validus Reinsurance, Ltd. and any other material insurance subsidiaries maintain a financial strength rating by A.M. Best of not less than “B++” (Fair). In addition, the Credit Facilities contain customary negative covenants applicable to the Company, including limitations on the ability to pay dividends and other payments in respect of equity interests at any time that the Company is otherwise in default with respect to certain provisions under the respective Credit Facilities, limitations on the ability to incur liens, sell assets, merge or consolidate with others, enter into transactions with affiliates, and limitations on the ability of its subsidiaries to incur indebtedness. The Credit Facilities also contain customary affirmative covenants, representations and warranties and events of default for credit facilities of its type. As of June 30, 2016, and throughout the reporting periods presented, the Company was in compliance with all covenants and restrictions under the Credit Facilities.
The Company assumed an existing evergreen letter of credit facility through the acquisition of IPC Holdings, Ltd. (the “IPC bi-lateral facility”). As of June 30, 2016, there were $5,666 outstanding letters of credit issued under the IPC bi-lateral facility (December 31, 2015: $9,241). As of June 30, 2016, and throughout the reporting periods presented, the Company was in compliance with all covenants and restrictions under the IPC bi-lateral facility.
The Company is party to an evergreen secured bi-lateral letter of credit facility with Citibank Europe plc (the “Secured bi-lateral letter of credit facility”). As of June 30, 2016, $11,805 (December 31, 2015: $10,543) of letters of credit were outstanding under the Secured bi-lateral letter of credit facility. The Secured bi-lateral letter of credit facility has no fixed termination date and as of June 30, 2016, and throughout the reporting periods presented, the Company is in compliance with all covenants and restrictions under the Secured bi-lateral letter of credit facility. iv.$20,000 AlphaCat Re secured letter of credit facility During 2013, AlphaCat Re entered into a secured evergreen letter of credit facility with Comerica Bank. This facility provided for letters of credit issued by AlphaCat Re to be used to support its reinsurance obligations. During the three months ended June 30, 2016 the available amount under the facility was reduced to $20,000 from $30,000. As of June 30, 2016, $20,000 (December 31, 2015: $30,000) of letters of credit were outstanding under this facility. As of June 30, 2016, and throughout the reporting periods presented, AlphaCat Re was in compliance with all covenants and restrictions under the AlphaCat Re secured letter of credit facility.
As part of the Flagstone Acquisition, the Company assumed an evergreen Letters of Credit Master Agreement between Citibank Europe plc and Flagstone Reassurance Suisse, S.A. (the “Flagstone Bi-Lateral Facility”). As of June 30, 2016, the Flagstone Bi-Lateral Facility had $195,622 (December 31, 2015: $193,764) letters of credit issued and outstanding. As of June 30, 2016, and throughout the reporting periods presented, the Company was in compliance with all covenants and restrictions under the Flagstone Bi-Lateral Facility.
Finance expenses consist of interest on the junior subordinated deferrable debentures and senior notes, the amortization of debt offering costs, credit facilities fees, bank charges, Talbot FAL facility and other charges and AlphaCat financing fees as follows:
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Accumulated other comprehensive loss |
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Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated other comprehensive loss | Accumulated other comprehensive loss The changes in accumulated other comprehensive loss, by component for the three and six months ended June 30, 2016 and 2015 was as follows:
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Commitments and contingencies |
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Jun. 30, 2016 | |||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||
Commitments and contingencies | Commitments and contingencies
Talbot operates in Lloyd’s through a corporate member, Talbot 2002 Underwriting Capital Ltd (“T02”), which is the sole participant in Syndicate 1183. Lloyd’s sets T02’s required capital annually based on Syndicate 1183’s business plan, rating environment and reserving environment together with input arising from Lloyd’s discussions with, inter alia, regulatory and rating agencies. Such capital, called Funds at Lloyd’s (“FAL”), comprises cash and investments. The Company provided FAL in the amount of $617,000 for the 2016 underwriting year (2015 underwriting year: $595,100). The amounts which are provided as FAL are not available for distribution to the Company for the payment of dividends. Talbot’s corporate member may also be required to maintain funds under the control of Lloyd’s in excess of its capital requirement and such funds also may not be available for distribution to the Company for the payment of dividends. See Note 3(e) for investments pledged as collateral.
Whenever a member of Lloyd’s is unable to pay its debts to policyholders, such debts may be payable by the Lloyd’s Central Fund. If Lloyd’s determines that the Central Fund needs to be increased, it has the power to assess premium levies on current Lloyd’s members up to 3% of a member's underwriting capacity in any one year. The Company does not believe that any assessment is likely in the foreseeable future and has not provided any allowance for such an assessment. However, based on the Company's 2016 underwriting capacity at Lloyd's of £600,000, at the June 30, 2016 exchange rate of £1 equals $1.33 and assuming the maximum 3% assessment, the Company would be assessed approximately $23,940.
As discussed in Note 6, "Investments in affiliates," on December 20, 2011, the Company entered into an Assignment and Assumption Agreement with Aquiline Capital Partners LLC, pursuant to which it assumed total capital commitments of $50,000 in respect of the Aquiline II Partnership. The Company’s remaining commitment at June 30, 2016 was $2,934 (December 31, 2015: $3,413). On October 2, 2014, the Company assumed an additional investment in the Aquiline II Partnership as part of the Western World acquisition, representing a total capital commitment of $10,000. The Company's remaining capital commitment at June 30, 2016 was $587 (December 31, 2015: $683). On November 7, 2014, the Company entered into a Subscription Agreement with the Aquiline III General Partner, pursuant to which it assumed total capital commitments of $100,000 in respect of the Aquiline III Partnership. The Company’s remaining commitment at June 30, 2016 was $70,379 (December 31, 2015: $86,110).
On December 29, 2014, the Company entered into an agreement with an AlphaCat ILS fund pursuant to which it assumed total capital commitments of $20,000. On December 29, 2015, the Company assumed an additional capital commitment of $20,000. The Company’s remaining commitment at June 30, 2016 was $nil (December 31, 2015: $10,000). On December 30, 2015, the Company entered into an agreement with another AlphaCat ILS fund pursuant to which it assumed total capital commitments of $25,000. The Company’s remaining commitment at June 30, 2016 was $nil (December 31, 2015: $9,536).
At June 30, 2016, the Company had an outstanding commitment to participate in certain secured loan facilities through participation agreements with an established loan originator. The undrawn amount under the revolver facility participations as at June 30, 2016 was $29,726 (December 31, 2015: $34,888). During 2016, the Company entered into a loan commitment of $25,000 of which the remaining unfunded commitment as at June 30, 2016 was $4,588.
At June 30, 2016, the Company had capital commitments in certain other investments of $308,000 (December 31, 2015: $263,000). The Company's remaining commitment to these investments at June 30, 2016 was $198,265 (December 31, 2015: $185,548). |
Related party transactions |
6 Months Ended |
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Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related party transactions | Related party transactions The transactions listed below are classified as related party transactions as principals and/or directors of each counterparty are members of the Company's board of directors. Aquiline Capital Partners, LLC and its related companies ("Aquiline"), which own 828,458 shares in the Company, have two employees on the Company's Board of Directors who do not receive compensation from the Company, are shareholders of Group Ark Insurance Holdings Ltd. ("Group Ark"). Christopher E. Watson, a director of the Company, serves as a director of Group Ark. Pursuant to reinsurance agreements with a subsidiary of Group Ark, the Company recognized gross premiums written during the three and six months ended June 30, 2016 of $65 (2015: $526) and $1,971 (2015: $2,396), respectively with $1,041 included in premiums receivable at June 30, 2016 (December 31, 2015: $82). The Company also recognized reinsurance premiums ceded during the three and six months ended June 30, 2016 of $(17) (2015: $(28)) and $nil (2015: $1), respectively and had reinsurance balances payable of $4 at June 30, 2016 (December 31, 2015: $4). The Company recorded $748 of loss reserves recoverable at June 30, 2016 (December 31, 2015: $790). Earned premium adjustments were recorded during the three and six months ended June 30, 2016 of $473 (2015: $534) and $999 (2015: $1,317), respectively. On November 24, 2009, the Company entered into an Investment Management Agreement with Conning, Inc. ("Conning") to manage a portion of the Company's investment portfolio. Aquiline acquired Conning on June 16, 2009. Jeffrey W. Greenberg, a director of the Company, serves as a director of Conning Holdings Corp., the parent company of Conning. During the three months ended September 30, 2015, Aquiline disposed of its investment in Conning. Therefore, effective September 30, 2015, Conning was no longer a related party. Investment management fees earned by Conning for the three and six months ended June 30, 2015 were $120 and $405, respectively. On December 20, 2011, the Company entered into an Agreement with Aquiline Capital and Aquiline II General Partner pursuant to which the Company has assumed 100% of Aquiline Capital's interest in the Aquiline II Partnership representing a total capital commitment of $50,000 (the "Aquiline II Commitment"), as a limited partner in the Partnership (the "Transferred Interest"). On October 2, 2014, the Company assumed an additional investment in the Aquiline II Partnership as part of the Western World acquisition representing a total capital commitment of $10,000. Messrs. Greenberg and Watson, directors of the Company, serve as managing principal and senior principal, respectively, of Aquiline Capital. For both the three and six months ended June 30, 2016, the Company incurred $440 in partnership fees (2015:$489 and $937, respectively) and made capital contributions of $nil and $575 (2015: $3,415 and $8,977), respectively. On November 7, 2014, the Company entered into a Subscription Agreement (the "Subscription Agreement") with the Aquiline III General Partner pursuant to which the Company is committing and agreeing to purchase limited partnership or other comparable limited liability equity interests (the "Limited Partnership Interests") in the "Aquiline III Partnership, and/or one or more Alternative Investment Vehicles and Intermediate Entities (together with the Aquiline III Partnership, the "Fund" or the "Entities") with a capital commitment (the "Aquiline III Commitment") in an amount equal to $100,000, as a limited partner in the Aquiline III Partnership. For both the three and six months ended June 30, 2016, the Company incurred $575 in partnership fees (2015: $369 and $1,239, respectively) and made capital contributions of $15,732 (2015: $nil and $14,138, respectively). On November 24, 2015, Western World, a subsidiary of the Company, entered into a Stock Purchase Agreement (the “Agreement”) with WRM America Indemnity Holding Company, LLC (the “Seller”), a company owned in part by Aquiline Financial Services Fund LP and Aquiline Financial Services Fund (Offshore) LP (collectively, “Aquiline”), pursuant to which Western World will purchase all of the issued and outstanding shares of capital stock of WRM America Indemnity Company, Inc. ("WRMAI"), a New York stock property and casualty insurance company. Under the terms of the Agreement, Western World has agreed to pay an amount equal to the sum of: (i) the amount of policyholder surplus of WRMAI as of the Closing Date, as shown on the Closing Balance Sheet, and (ii) $3,750. The Agreement includes customary indemnities and conditions to closing including the approval by The New York Department of Financial Services of the acquisition of control of WRMAI by Western World. Certain shareholders of the Company and their affiliates, as well as employers of entities associated with directors or officers have purchased insurance and/or reinsurance from the Company in the ordinary course of business. The Company believes these transactions were settled for arm's length consideration. |
Earnings per share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per share | Earnings per share The following table sets forth the computation of basic and earnings per diluted share for the three and six months ended June 30, 2016 and 2015:
Share equivalents that would result in the issuance of common shares of 507,262 (2015: 630,174) and 253,631 (2015: 315,410) were outstanding for the three and six months ended June 30, 2016, respectively, but were not included in the computation of earnings per diluted share because the effect would be antidilutive. |
Segment information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment information | Segment information The Company conducts its operations worldwide through four operating segments, which have been determined under U.S. GAAP segment reporting to be Validus Re, Talbot, Western World and AlphaCat. The Company’s operating segments are strategic business units that offer different products and services. They are managed and have capital allocated separately because each segment requires different strategies. During the fourth quarter of 2015, the Company made certain changes in its presentation of segment information. The changes were made to present the results of Validus Re, Talbot and Western World on an underwriting income basis and the results of AlphaCat on an asset manager basis. Investment results, foreign exchange, other income (loss), finance expenses and income taxes are now presented on a consolidated basis, reflecting how the Company operationally manages these areas. The Company's assets primarily comprise cash and investments which are managed on a consolidated basis; accordingly, the Company's assets have not been presented on a segmental basis. The presentation changes have not had an effect on the reportable income or loss to any of the operating segments and all prior period disclosures have been revised to conform to current period presentation. Underwriting income and the AlphaCat asset manager view are non-GAAP financial measures. A reconciliation of segmental income to net income available to Validus is included in the tables below. Validus Re Segment The Validus Re segment is focused on treaty reinsurance. The primary lines in which the segment conducts business are property, marine and specialty which includes agriculture, aerospace and aviation, financial lines of business, nuclear, terrorism, life, accident & health, workers’ compensation, crisis management, contingency, technical lines, composite, trade credit and casualty. Talbot Segment The Talbot segment is focused on a wide range of marine and energy, political lines, commercial property, financial lines, contingency, accident & health and aviation classes of business on an insurance or facultative reinsurance basis and principally property, aerospace and marine classes of business on a treaty reinsurance basis. Western World Segment The Western World segment is focused on providing commercial insurance products on a surplus lines and specialty admitted basis. Western World specializes in underwriting classes of business that are not easily placed in the standard insurance market due to their complexity, high hazard, or unusual nature; including general liability, property and professional liability classes of business. AlphaCat Segment The AlphaCat segment leverages the Company’s underwriting and analytical expertise and earns management and performance fees from the Company and other third party investors primarily through the AlphaCat ILS funds and sidecars. Corporate and Investment information The Company has a corporate function ("Corporate"), which includes the activities of the parent company, and which carries out certain functions for the group, including investment management. Corporate includes investment income on a managed basis and other non-segment expenses, predominantly general and administrative, stock compensation and finance expenses. Corporate also denotes the activities of certain key executives such as the Chief Executive Officer and Chief Financial Officer. For internal reporting purposes, Corporate is reflected separately; however, Corporate is not considered an operating segment under these circumstances. Other reconciling items include, but are not limited to, the elimination of certain inter segment revenues and expenses and other items that are not allocated to the operating segments. The following tables summarize the results of our operating segments and "Corporate and Investments":
The following tables reconcile the results of our operating segments and "Corporate & Investments" to the Consolidated results of the Company for the periods indicated:
The Company’s exposures are generally diversified across geographic zones. The following tables set forth the gross premiums written allocated to the territory of coverage exposure for the periods indicated:
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Subsequent events |
6 Months Ended |
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Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent events | Subsequent events Quarterly Dividend On August 3, 2016, the Company announced a quarterly cash dividend of $0.35 per each common share, payable on September 30, 2016 to holders of record on September 15, 2016 and a cash dividend of $0.3753472 per depositary share on the outstanding Series A Preferred Shares, payable on September 15, 2016 to the holders of record on September 1, 2016. |
Significant accounting policies (Policies) |
6 Months Ended |
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Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of preparation | These unaudited Consolidated Financial Statements (the "Consolidated Financial Statements") have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 in Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In addition, the year-end balance sheet data was derived from audited financial statements but does not include all disclosures required by U.S. GAAP. This Quarterly Report on Form 10-Q should be read in conjunction with the financial statements and related notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the U.S. Securities and Exchange Commission (the "SEC"). The Company consolidates in these Consolidated Financial Statements the results of operations and financial position of all voting interest entities ("VOE") in which the Company has a controlling financial interest and all variable interest entities ("VIE") in which the Company is considered to be the primary beneficiary. The consolidation assessment, including the determination as to whether an entity qualifies as a VIE or VOE, depends on the facts and circumstances surrounding each entity. |
Use of estimates | The preparation of these financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. While management believes that the amounts included in the Consolidated Financial Statements reflect its best estimates and assumptions, actual results could differ materially from those estimates. The Company’s principal estimates include: •reserve for losses and loss expenses; •premium estimates for business written on a line slip or proportional basis; •the valuation of goodwill and intangible assets; •reinsurance recoverable balances including the provision for uncollectible amounts; and •investment valuation of financial assets. |
Consolidating voting interest entities and variable interest entities | The Company consolidates all VOEs in which it has a controlling financial interest and all VIEs in which it is considered to be the primary beneficiary. |
Reserves for losses and loss expenses | Reserves for losses and loss expenses are based in part upon the estimation of case reserves from broker, insured and ceding company reported data. The Company also uses statistical and actuarial methods to estimate ultimate expected losses and loss expenses, from which incurred but not reported losses can be calculated. The period of time from the occurrence of a loss to the reporting of a loss to the Company and to the settlement of the Company's liability may be several months or years. During this period, additional facts and trends may be revealed. As these factors become apparent, reserves will be adjusted, sometimes requiring an increase or decrease in the overall reserves of the Company, and at other times requiring a reallocation of incurred but not reported reserves ("IBNR") to specific case reserves. These estimates are reviewed and adjusted regularly, and such adjustments, if any, are reflected in earnings in the period in which they become known. While management believes that it has made a reasonable estimate of ultimate losses, there can be no assurances that ultimate losses and loss expenses will not exceed this estimate. |
Reinsurance | To estimate this provision for uncollectible reinsurance, the reinsurance recoverable is first allocated to applicable reinsurers. This determination is based on a process rather than an estimate, although an element of judgment is applied, especially in relation to ceded IBNR. The Company then uses default factors to determine the portion of a reinsurer’s balance deemed to be uncollectible. Default factors require considerable judgment and are determined in part using the current rating, or rating equivalent, of each reinsurer as well as other key considerations and assumptions. |
Basis of preparation and consolidation (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Impact of application of new accounting guidance | The following tables present the impact of the application of the amended accounting guidance on the Company's Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2015 and Consolidated Statement of Cash Flows for the six months ended June 30, 2015:
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Investments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Investments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amortized cost (or cost), gross unrealized gains and (losses) and fair value of investments | The amortized cost (or cost), gross unrealized gains and (losses) and fair value of the Company's investments as at June 30, 2016 were as follows:
The amortized cost (or cost), gross unrealized gains and (losses) and fair value of the Company's investments as at December 31, 2015 were as follows:
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Investment ratings on fixed maturities | The following table sets forth certain information regarding the investment ratings of the Company’s fixed maturity investments as at June 30, 2016 and December 31, 2015.
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Fixed maturities investments by contractual maturity | The amortized cost and fair value amounts for the Company's fixed maturity investments held at June 30, 2016 and December 31, 2015 are shown below by contractual maturity. Actual maturity may differ from contractual maturity because certain borrowers may have the right to call or prepay certain obligations with or without call or prepayment penalties.
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Other investments | The following tables set forth certain information regarding the Company's other investment portfolio as at June 30, 2016 and December 31, 2015:
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Net investment income | Net investment income was derived from the following sources:
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Analysis of net realized gains and the change in net unrealized gains (losses) on investments | The following represents an analysis of net realized gains and the change in net unrealized gains (losses) on investments:
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Investments and cash pledged as collateral under credit facilities | The following tables outline investments and cash pledged as collateral under the Company's credit facilities. For further details on the credit facilities, please refer to Note 13, “Debt and financing arrangements.”
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Fair value measurements (Tables) |
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value hierarchy - allocation of investments | At June 30, 2016, the Company’s investments were allocated between Levels 1, 2 and 3 as follows:
At December 31, 2015, the Company’s investments were allocated between Levels 1, 2 and 3 as follows:
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Reconciliation of beginning and ending balances for all Level 3 investments measured at fair value on recurring basis | The following table presents a reconciliation of the beginning and ending balances for all investments measured at fair value on a recurring basis using Level 3 inputs during the three and six months ended June 30, 2016 and 2015:
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Variable interest entities (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Variable Interest Entities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of notes payable to variable interest entities | The following table presents a reconciliation of the beginning and ending notes payable to AlphaCat investors for the three and six months ended June 30, 2016:
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Total assets and liabilities of the Company's consolidated VIEs | The following table presents the total assets and total liabilities of the Company’s consolidated VIEs, excluding intercompany eliminations, as at June 30, 2016 and December 31, 2015:
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Investments in affiliates (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of equity method investments | The following table presents the Company's investments in affiliates as at June 30, 2016 and December 31, 2015:
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Investment affiliate | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of the beginning and ending non-consolidated affiliate balance | The following table presents a reconciliation of the beginning and ending investment in the Company's investment affiliate balance for the three and six months ended June 30, 2016 and 2015:
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Schedule of equity method investments | The following table presents the Company’s investment in the partnerships as at June 30, 2016:
The following table presents the Company’s investment in the partnerships as at December 31, 2015:
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Operating affiliate | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of the beginning and ending non-consolidated affiliate balance | The following table presents a reconciliation of the beginning and ending investment in the Company's operating affiliate balance for the three and six months ended June 30, 2016 and 2015:
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Schedule of equity method investments | The following table presents the Company’s investment in PaCRe as at June 30, 2016:
The following table presents the Company’s investment in PaCRe as at December 31, 2015:
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Noncontrolling interest (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Noncontrolling Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of beginning and ending balances of noncontrolling interest and redeemable noncontrolling interest | The following tables present a reconciliation of the beginning and ending balances of redeemable noncontrolling interest and noncontrolling interest for the three and six months ended June 30, 2016 and 2015:
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Derivative instruments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Location and fair value amount of derivative instruments reported on the balance sheet | The following table summarizes information on the classification and amount of the fair value of derivatives not designated as hedging instruments for accounting purposes on the Consolidated Balance Sheets as at June 30, 2016 and December 31, 2015:
The following table summarizes information on the classification and amount of the fair value of derivatives designated as hedging instruments for accounting purposes on the Consolidated Balance Sheets as at June 30, 2016 and December 31, 2015:
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Location and amount of gains and losses related to derivative instruments reported on in the income statement | The following table provides the total impact on earnings, recognized in income within foreign exchange gains (losses), relating to the derivative instruments formally designated as fair value hedges for accounting purposes along with the impact of the related hedged items for the three and six months ended June 30, 2016 and 2015:
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Location and amount of gains and losses related to derivative instruments reported on in the comprehensive income and earnings | The following table provides the total impact on other comprehensive income (loss) and earnings relating to the derivative instruments formally designated as cash flow hedges along with the impact of the related hedged items for the three and six months ended June 30, 2016 and 2015:
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Reserve for losses and loss expenses (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reserve for losses and loss expenses | The following table represents an analysis of paid and unpaid losses and loss expenses incurred and a reconciliation of the beginning and ending unpaid losses and loss expenses for the three and six months ended June 30, 2016 and 2015:
Incurred losses and loss expenses comprise:
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Prior year development by segment and line of business | The net favorable development on prior years by segment and line of business for the three and six months ended June 30, 2016 and 2015 was as follows:
The net favorable development of $62.8 million for the three months ended June 30, 2016 was primarily due to favorable development on attritional losses and prior year event and non-event reserves. The Validus Re and Western World segments experienced favorable development on prior years primarily due to favorable development on attritional losses; whereas, the Talbot segment experienced favorable development on prior years primarily due to favorable development on event and non-event reserves.
The Validus Re segment experienced favorable development on prior years primarily due to favorable development on attritional losses; whereas, the Talbot segment experienced favorable development on prior years primarily due to favorable development on attritional losses and certain events, including the Thailand floods. The Western World segment experienced favorable development on prior years primarily due to the amortization of the fair value adjustment made at the acquisition date as well as favorable development on attritional losses.
The net favorable development of $116.5 million for the six months ended June 30, 2016 was primarily attributable to net favorable development in the Validus Re, Talbot and Western World segments. The Validus Re net favorable development was primarily attributable to favorable development on attritional losses or non-event reserves; whereas Talbot's favorable development was due to favorable development on attritional losses along with favorable development on prior year event reserves. Western World's net favorable development was attributable to favorable development on attritional losses.
|
Reinsurance (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance recoverables by reinsurer | Reinsurance recoverable by reinsurer as at June 30, 2016 and December 31, 2015 were as follows:
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Share capital (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of preferred shares issued and outstanding | The following table is a summary of the Preferred shares issued and outstanding:
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Summary of common shares issued and outstanding | The following table is a summary of the common shares issued and outstanding:
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Stock plans (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Options, activity during the period | Activity with respect to options for the six months ended June 30, 2016 was as follows:
Activity with respect to options for the six months ended June 30, 2015 was as follows:
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Restricted shares awards, activity during the period | Activity with respect to unvested restricted share awards for the six months ended June 30, 2016 was as follows:
Activity with respect to unvested restricted share awards for the six months ended June 30, 2015 was as follows:
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Restricted share units, activity during the period | Activity with respect to unvested restricted share units for the six months ended June 30, 2016 was as follows:
Activity with respect to unvested restricted share units for the six months ended June 30, 2015 was as follows:
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Performance share awards, activity during the period | Activity with respect to unvested performance share awards for the six months ended June 30, 2016 was as follows:
Activity with respect to unvested performance share awards for the six months ended June 30, 2015 was as follows:
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Total share compensation expenses | The breakdown of share compensation expenses by award type for the periods indicated was as follows:
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Debt and financing arrangements (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of financing structure | The financing structure at June 30, 2016 was as follows:
The financing structure at December 31, 2015 was as follows:
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Summary of key terms of senior notes and junior subordinated deferrable debentures | The following table summarizes the key terms of the Company's senior notes and junior subordinated deferrable debentures:
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Components of finance expenses | Finance expenses consist of interest on the junior subordinated deferrable debentures and senior notes, the amortization of debt offering costs, credit facilities fees, bank charges, Talbot FAL facility and other charges and AlphaCat financing fees as follows:
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Accumulated other comprehensive loss (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of changes in accumulated other comprehensive loss | The changes in accumulated other comprehensive loss, by component for the three and six months ended June 30, 2016 and 2015 was as follows:
|
Earnings per share (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of basic and diluted earnings per share | The following table sets forth the computation of basic and earnings per diluted share for the three and six months ended June 30, 2016 and 2015:
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Segment information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of results of operating segments and Corporate | The following tables summarize the results of our operating segments and "Corporate and Investments":
The following tables reconcile the results of our operating segments and "Corporate & Investments" to the Consolidated results of the Company for the periods indicated:
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Gross premiums written allocated to the territory of coverage exposure | The following tables set forth the gross premiums written allocated to the territory of coverage exposure for the periods indicated:
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Investments (Components of net investment income) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
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Net investment income | ||||
Net investment income | $ 39,257 | $ 33,611 | $ 68,718 | $ 64,640 |
Managed investments | ||||
Net investment income | ||||
Total gross investment income | 39,039 | 33,880 | 68,798 | 65,160 |
Investment expenses | (2,190) | (2,026) | (4,026) | (3,870) |
Net investment income | 36,849 | 31,854 | 64,772 | 61,290 |
Managed investments | Fixed maturities and short term investments | ||||
Net investment income | ||||
Total gross investment income | 30,621 | 29,433 | 58,638 | 57,106 |
Managed investments | Other investments | ||||
Net investment income | ||||
Total gross investment income | 8,026 | 4,014 | 8,898 | 7,202 |
Managed investments | Securities lending income | ||||
Net investment income | ||||
Total gross investment income | 12 | 6 | 17 | 9 |
Managed investments | Restricted cash, cash and cash equivalents | ||||
Net investment income | ||||
Total gross investment income | 380 | 427 | 1,245 | 843 |
Non-managed investments | ||||
Net investment income | ||||
Net investment income | 2,408 | 1,757 | 3,946 | 3,350 |
Non-managed investments | Fixed maturities and short term investments | ||||
Net investment income | ||||
Total gross investment income | 1,977 | 1,733 | 3,272 | 3,307 |
Non-managed investments | Restricted cash, cash and cash equivalents | ||||
Net investment income | ||||
Total gross investment income | $ 431 | $ 24 | $ 674 | $ 43 |
Investments (Realized and unrealized gains) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
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Fixed Maturities Short Term And Other Investments And Cash Equivalents [Abstract] | ||||
Net realized gains on investments | $ 2,724 | $ 2,244 | $ 2,140 | $ 6,413 |
Change in net unrealized gains (losses) on investments | 31,428 | (34,676) | 78,872 | (1,449) |
Total net realized and change in net unrealized gains (losses) on investments | 34,152 | (32,432) | 81,012 | 4,964 |
Managed investments | ||||
Fixed Maturities Short Term And Other Investments And Cash Equivalents [Abstract] | ||||
Gross realized gains | 3,306 | 6,140 | 6,523 | 12,449 |
Gross realized losses | (786) | (4,036) | (5,089) | (6,165) |
Net realized gains on investments | 2,520 | 2,104 | 1,434 | 6,284 |
Change in net unrealized gains (losses) on investments | 30,052 | (33,926) | 77,130 | 743 |
Total net realized and change in net unrealized gains (losses) on investments | 32,572 | (31,822) | 78,564 | 7,027 |
Non-managed investments | ||||
Fixed Maturities Short Term And Other Investments And Cash Equivalents [Abstract] | ||||
Gross realized gains | 204 | 140 | 715 | 140 |
Gross realized losses | 0 | 0 | (9) | (11) |
Net realized gains on investments | 204 | 140 | 706 | 129 |
Change in net unrealized gains (losses) on investments | 1,376 | (750) | 1,742 | (2,192) |
Total net realized and change in net unrealized gains (losses) on investments | $ 1,580 | $ (610) | $ 2,448 | $ (2,063) |
Investments (Investments pledged as collateral) (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
|||
---|---|---|---|---|---|
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Credit facility, commitment | $ 690,000 | $ 700,000 | |||
Letters of credit issued and outstanding | [1] | 338,668 | 479,088 | ||
Investments and cash pledged as collateral | 552,257 | 826,535 | |||
$85,000 syndicated unsecured letter of credit facility | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Credit facility, commitment | 85,000 | 85,000 | |||
Letters of credit issued and outstanding | 0 | 0 | |||
Investments and cash pledged as collateral | 0 | 0 | |||
$300,000 syndicated secured letter of credit facility | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Credit facility, commitment | 300,000 | 300,000 | |||
Letters of credit issued and outstanding | [1] | 105,575 | 235,540 | ||
Investments and cash pledged as collateral | 151,166 | 370,909 | |||
$24,000 secured bi-lateral letter of credit facility | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Credit facility, commitment | 24,000 | 24,000 | |||
Letters of credit issued and outstanding | [1] | 11,805 | 10,543 | ||
Investments and cash pledged as collateral | 48,380 | 47,607 | |||
AlphaCat Re secured letter of credit facility | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Credit facility, commitment | 20,000 | 30,000 | |||
Letters of credit issued and outstanding | [1] | 20,000 | 30,000 | ||
Investments and cash pledged as collateral | 30,191 | 30,153 | |||
$25,000 IPC bi-lateral facility | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Credit facility, commitment | 25,000 | 25,000 | |||
Letters of credit issued and outstanding | [1] | 5,666 | 9,241 | ||
Investments and cash pledged as collateral | 0 | 0 | |||
$236,000 Flagstone bi-lateral facility | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Credit facility, commitment | 236,000 | 236,000 | |||
Letters of credit issued and outstanding | [1] | 195,622 | 193,764 | ||
Investments and cash pledged as collateral | $ 322,520 | $ 377,866 | |||
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Investments (Narrative) (Details) $ in Thousands |
6 Months Ended | |
---|---|---|
Jun. 30, 2016
USD ($)
funds
|
Dec. 31, 2015
USD ($)
|
|
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Other investments, at fair value | $ 359,526 | $ 336,856 |
Cash, cash equivalents, restricted cash and investments pledged as collateral | 4,687,599 | 4,056,788 |
Investments held in trust | $ 4,564,394 | 4,007,215 |
Minimum | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share, Liquidating Investment, Remaining Period | 5 years | |
Maximum | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share, Liquidating Investment, Remaining Period | 10 years | |
Managed investments | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Other investments, at fair value | $ 359,526 | 336,856 |
Managed investments | Recurring | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Other investments, at fair value | 359,526 | 336,856 |
Managed investments | Recurring | Subject to redemption restriction | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Other investments, at fair value | $ 329,727 | 308,562 |
Managed investments | Recurring | Subject to redemption restriction | Investment fund A | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Other investments number of funds | funds | 1 | |
Other investments, at fair value | $ 171,187 | $ 167,910 |
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share, Redemption Restriction Period | 3 years |
Fair value measurements (Fair value hierarchy) (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | $ 5,551,586 | $ 5,510,331 |
Short-term investments, at fair value | 2,369,654 | 1,941,635 |
Other investments, at fair value | 359,526 | 336,856 |
Total investments | 8,280,766 | 7,788,822 |
Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investments | 8,280,766 | 7,788,822 |
Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investments | 2,366,302 | 1,926,944 |
Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investments | 5,291,688 | 5,307,479 |
Recurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investments | 293,049 | 245,837 |
Managed investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 5,393,525 | 5,323,952 |
Short-term investments, at fair value | 189,628 | 237,369 |
Other investments, at fair value | 359,526 | 336,856 |
Total investments | 5,942,679 | 5,898,177 |
Managed investments | U.S. government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 931,803 | 937,202 |
Managed investments | Non-US government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 215,250 | 237,968 |
Managed investments | U.S. states, municipalities, political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 285,412 | 301,289 |
Managed investments | Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 676,783 | 610,582 |
Managed investments | Non-Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 23,389 | 26,920 |
Managed investments | U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 1,556,047 | 1,489,951 |
Managed investments | Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 364,406 | 446,570 |
Managed investments | Bank loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 597,062 | 576,211 |
Managed investments | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 429,340 | 437,124 |
Managed investments | Commercial mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 314,033 | 260,135 |
Managed investments | Fund of hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 959 | 1,417 |
Managed investments | Hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 18,625 | 20,980 |
Managed investments | Private equity investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 73,306 | 63,771 |
Managed investments | Investment funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 203,871 | 188,721 |
Managed investments | Overseas deposits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 55,301 | 54,484 |
Managed investments | Mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 7,464 | 7,483 |
Managed investments | Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 5,393,525 | 5,323,952 |
Short-term investments, at fair value | 189,628 | 237,369 |
Other investments, at fair value | 359,526 | 336,856 |
Total investments | 5,942,679 | 5,898,177 |
Managed investments | Recurring | U.S. government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 931,803 | 937,202 |
Managed investments | Recurring | Non-US government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 215,250 | 237,968 |
Managed investments | Recurring | U.S. states, municipalities, political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 285,412 | 301,289 |
Managed investments | Recurring | Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 676,783 | 610,582 |
Managed investments | Recurring | Non-Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 23,389 | 26,920 |
Managed investments | Recurring | U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 1,556,047 | 1,489,951 |
Managed investments | Recurring | Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 364,406 | 446,570 |
Managed investments | Recurring | Bank loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 597,062 | 576,211 |
Managed investments | Recurring | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 429,340 | 437,124 |
Managed investments | Recurring | Commercial mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 314,033 | 260,135 |
Managed investments | Recurring | Fund of hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 959 | 1,417 |
Managed investments | Recurring | Hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 18,625 | 20,980 |
Managed investments | Recurring | Private equity investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 73,306 | 63,771 |
Managed investments | Recurring | Investment funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 203,871 | 188,721 |
Managed investments | Recurring | Overseas deposits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 55,301 | 54,484 |
Managed investments | Recurring | Mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 7,464 | 7,483 |
Managed investments | Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Short-term investments, at fair value | 186,276 | 222,678 |
Other investments, at fair value | 0 | 0 |
Total investments | 186,276 | 222,678 |
Managed investments | Recurring | Level 1 | U.S. government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Non-US government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | U.S. states, municipalities, political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Non-Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Bank loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Commercial mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Fund of hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Private equity investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Investment funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Overseas deposits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 1 | Mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 5,137,994 | 5,091,615 |
Short-term investments, at fair value | 3,352 | 14,691 |
Other investments, at fair value | 29,799 | 28,294 |
Total investments | 5,171,145 | 5,134,600 |
Managed investments | Recurring | Level 2 | U.S. government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 931,803 | 937,202 |
Managed investments | Recurring | Level 2 | Non-US government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 215,250 | 237,968 |
Managed investments | Recurring | Level 2 | U.S. states, municipalities, political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 285,412 | 301,289 |
Managed investments | Recurring | Level 2 | Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 676,783 | 610,582 |
Managed investments | Recurring | Level 2 | Non-Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 23,389 | 26,920 |
Managed investments | Recurring | Level 2 | U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 1,556,047 | 1,489,951 |
Managed investments | Recurring | Level 2 | Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 364,406 | 446,570 |
Managed investments | Recurring | Level 2 | Bank loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 353,914 | 343,874 |
Managed investments | Recurring | Level 2 | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 416,957 | 437,124 |
Managed investments | Recurring | Level 2 | Commercial mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 314,033 | 260,135 |
Managed investments | Recurring | Level 2 | Fund of hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 2 | Hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 2 | Private equity investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 2 | Investment funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 22,335 | 20,811 |
Managed investments | Recurring | Level 2 | Overseas deposits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 2 | Mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 7,464 | 7,483 |
Managed investments | Recurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 255,531 | 232,337 |
Short-term investments, at fair value | 0 | 0 |
Other investments, at fair value | 0 | 0 |
Total investments | 255,531 | 232,337 |
Managed investments | Recurring | Level 3 | U.S. government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Non-US government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | U.S. states, municipalities, political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Non-Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Bank loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 243,148 | 232,337 |
Managed investments | Recurring | Level 3 | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 12,383 | 0 |
Managed investments | Recurring | Level 3 | Commercial mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Fund of hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Private equity investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Investment funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Overseas deposits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Non-managed investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 158,061 | 186,379 |
Short-term investments, at fair value | 2,180,026 | 1,704,266 |
Total investments | 2,338,087 | 1,890,645 |
Non-managed investments | Catastrophe bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 158,061 | 186,379 |
Non-managed investments | Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments, at fair value | 2,180,026 | 1,704,266 |
Total investments | 2,338,087 | 1,890,645 |
Non-managed investments | Recurring | Catastrophe bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 158,061 | 186,379 |
Non-managed investments | Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments, at fair value | 2,180,026 | 1,704,266 |
Total investments | 2,180,026 | 1,704,266 |
Non-managed investments | Recurring | Level 1 | Catastrophe bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Non-managed investments | Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments, at fair value | 0 | 0 |
Total investments | 120,543 | 172,879 |
Non-managed investments | Recurring | Level 2 | Catastrophe bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 120,543 | 172,879 |
Non-managed investments | Recurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments, at fair value | 0 | 0 |
Total investments | 37,518 | 13,500 |
Non-managed investments | Recurring | Level 3 | Catastrophe bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 37,518 | 13,500 |
Fair value based on NAV practical expedient | Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investments | 329,727 | 308,562 |
Fair value based on NAV practical expedient | Managed investments | Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Short-term investments, at fair value | 0 | 0 |
Other investments, at fair value | 329,727 | 308,562 |
Total investments | 329,727 | 308,562 |
Fair value based on NAV practical expedient | Managed investments | Recurring | U.S. government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Non-US government and government agency | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Fair value based on NAV practical expedient | Managed investments | Recurring | U.S. states, municipalities, political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Non-Agency residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Fair value based on NAV practical expedient | Managed investments | Recurring | U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Bank loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Commercial mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | 0 | 0 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Fund of hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 959 | 1,417 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Hedge funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 18,625 | 20,980 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Private equity investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 73,306 | 63,771 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Investment funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 181,536 | 167,910 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Overseas deposits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 55,301 | 54,484 |
Fair value based on NAV practical expedient | Managed investments | Recurring | Mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Fair value based on NAV practical expedient | Non-managed investments | Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments, at fair value | 0 | 0 |
Total investments | 0 | 0 |
Fair value based on NAV practical expedient | Non-managed investments | Recurring | Catastrophe bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, at fair value | $ 0 | $ 0 |
Fair value measurements (Level 3 rollforward) (Details) - Level 3 - Recurring - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Reconciliation of beginning and ending balances for all investments measured at fair value on recurring basis | ||||
Level 3 investments - beginning of period | $ 292,116 | $ 102,033 | $ 245,837 | $ 50,248 |
Purchases | 21,268 | 43,791 | 86,643 | 101,966 |
Sales | (2,929) | (2,389) | (4,918) | |
Settlements | (17,784) | (4,203) | (34,158) | (8,198) |
Net realized losses | (11) | |||
Change in net unrealized (losses) gains | (2,551) | (210) | (2,884) | (605) |
Transfers into Level 3 during the period | 0 | 0 | 0 | 0 |
Transfers out of Level 3 during the period | 0 | 0 | 0 | 0 |
Level 3 investments - end of period | 293,049 | 138,482 | 293,049 | 138,482 |
Bank loan portfolio | ||||
Reconciliation of beginning and ending balances for all investments measured at fair value on recurring basis | ||||
Level 3 investments - beginning of period | 255,011 | 86,533 | 232,337 | 32,748 |
Purchases | 8,885 | 43,791 | 50,988 | 101,966 |
Sales | (929) | (2,389) | (929) | |
Settlements | (17,784) | (4,203) | (34,033) | (8,198) |
Net realized losses | 0 | |||
Change in net unrealized (losses) gains | (2,964) | (210) | (3,755) | (605) |
Transfers into Level 3 during the period | 0 | 0 | 0 | 0 |
Transfers out of Level 3 during the period | 0 | 0 | 0 | 0 |
Level 3 investments - end of period | 243,148 | 124,982 | 243,148 | 124,982 |
Catastrophe bonds | ||||
Reconciliation of beginning and ending balances for all investments measured at fair value on recurring basis | ||||
Level 3 investments - beginning of period | 37,105 | 15,500 | 13,500 | 17,500 |
Purchases | 0 | 0 | 23,272 | 0 |
Sales | (2,000) | 0 | (3,989) | |
Settlements | 0 | 0 | (125) | 0 |
Net realized losses | (11) | |||
Change in net unrealized (losses) gains | 413 | 0 | 871 | 0 |
Transfers into Level 3 during the period | 0 | 0 | 0 | 0 |
Transfers out of Level 3 during the period | 0 | 0 | 0 | 0 |
Level 3 investments - end of period | 37,518 | $ 13,500 | 37,518 | $ 13,500 |
Asset-backed securities | ||||
Reconciliation of beginning and ending balances for all investments measured at fair value on recurring basis | ||||
Level 3 investments - beginning of period | 0 | 0 | ||
Purchases | 12,383 | 12,383 | ||
Sales | 0 | |||
Settlements | 0 | 0 | ||
Change in net unrealized (losses) gains | 0 | 0 | ||
Transfers into Level 3 during the period | 0 | 0 | ||
Transfers out of Level 3 during the period | 0 | 0 | ||
Level 3 investments - end of period | $ 12,383 | $ 12,383 |
Fair value measurements (Narrative) (Details) $ in Thousands |
6 Months Ended | |
---|---|---|
Jun. 30, 2016
USD ($)
funds
|
Dec. 31, 2015
USD ($)
|
|
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Trading Securities | $ 8,280,766 | $ 7,788,822 |
Other investments, at fair value | 359,526 | 336,856 |
Recurring | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Trading Securities | $ 8,280,766 | 7,788,822 |
Recurring | Hedge fund side pocket | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Investment Time Lag Reporting | 3 months | |
Recurring | Hedge funds | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Investment Time Lag Reporting | 3 months | |
Other investments number of funds | funds | 1 | |
Recurring | Pooled investment | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments number of funds | funds | 1 | |
Recurring | Structured securities fund | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments number of funds | funds | 2 | |
Recurring | Mutual funds | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments number of funds | funds | 2 | |
Recurring | Minimum | Private equity investments | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Investment Time Lag Reporting | 3 months | |
Recurring | Maximum | Private equity investments | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Investment Time Lag Reporting | 6 months | |
Recurring | Level 3 | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Trading Securities | $ 293,049 | 245,837 |
Managed investments | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Trading Securities | 5,942,679 | 5,898,177 |
Other investments, at fair value | 359,526 | 336,856 |
Managed investments | Hedge funds | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | 18,625 | 20,980 |
Managed investments | Private equity investments | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | 73,306 | 63,771 |
Managed investments | Investment funds | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | 203,871 | 188,721 |
Managed investments | Mutual funds | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | 7,464 | 7,483 |
Managed investments | Recurring | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Trading Securities | $ 5,942,679 | $ 5,898,177 |
Ratio of Level 3 investments to total investments (percent) | 4.30% | 3.90% |
Other investments, at fair value | $ 359,526 | $ 336,856 |
Managed investments | Recurring | Hedge funds | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | 18,625 | 20,980 |
Managed investments | Recurring | Private equity investments | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | 73,306 | 63,771 |
Managed investments | Recurring | Investment funds | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | 203,871 | 188,721 |
Managed investments | Recurring | Mutual funds | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | 7,464 | 7,483 |
Managed investments | Recurring | Level 3 | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Trading Securities | 255,531 | 232,337 |
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Hedge funds | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Private equity investments | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Investment funds | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | 0 | 0 |
Managed investments | Recurring | Level 3 | Mutual funds | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Other investments, at fair value | $ 0 | $ 0 |
Variable interest entities (Notes payable to AlphaCat investors) (Details) - Variable interest entities, primary beneficiary - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2016 |
|
Variable Interest Entity [Line Items] | ||
Notes payable to AlphaCat investors, beginning of period | $ 323,510 | $ 75,493 |
Issuance of notes payable to AlphaCat investors | 135,426 | 392,431 |
Redemption of notes payable to AlphaCat investors | (88,079) | (97,684) |
Foreign exchange losses | 125 | 742 |
Notes payable to AlphaCat investors, end of period | 370,982 | 370,982 |
Variable Funding Notes | ||
Variable Interest Entity [Line Items] | ||
Notes payable to AlphaCat investors, beginning of period | 261,793 | 75,493 |
Issuance of notes payable to AlphaCat investors | 102,817 | 298,105 |
Redemption of notes payable to AlphaCat investors | (88,079) | (97,684) |
Foreign exchange losses | 125 | 742 |
Notes payable to AlphaCat investors, end of period | 276,656 | 276,656 |
Structured Notes | ||
Variable Interest Entity [Line Items] | ||
Notes payable to AlphaCat investors, beginning of period | 61,717 | 0 |
Issuance of notes payable to AlphaCat investors | 32,609 | 94,326 |
Redemption of notes payable to AlphaCat investors | 0 | 0 |
Foreign exchange losses | 0 | 0 |
Notes payable to AlphaCat investors, end of period | $ 94,326 | $ 94,326 |
Variable interest entities (Assets and liabilities of consolidated VIEs) (Details) - Variable interest entities, primary beneficiary - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
|||
---|---|---|---|---|---|
AlphaCat sidecars | |||||
Variable Interest Entity [Line Items] | |||||
Total assets | $ 47,693 | $ 206,581 | |||
Total liabilities | 10,468 | 14,804 | |||
AlphaCat ILS funds - Lower Risk (a) | |||||
Variable Interest Entity [Line Items] | |||||
Total assets | [1] | 1,544,346 | 1,268,070 | ||
Total liabilities | [1] | 129,842 | 143,371 | ||
AlphaCat ILS funds - Higher Risk (a) | |||||
Variable Interest Entity [Line Items] | |||||
Total assets | [1] | 701,348 | 522,867 | ||
Total liabilities | [1] | 147,466 | 300,122 | ||
AlphaCat Re and AlphaCat Master Fund | |||||
Variable Interest Entity [Line Items] | |||||
Total assets | 2,431,907 | 1,615,779 | |||
Total liabilities | 2,431,737 | 1,615,609 | |||
BetaCat ILS funds | |||||
Variable Interest Entity [Line Items] | |||||
Total assets | 63,947 | 64,221 | |||
Total liabilities | $ 493 | $ 2,472 | |||
|
Variable interest entities (Narrative) (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Jun. 30, 2016
USD ($)
funds
subsidiaries
|
Jun. 30, 2015
USD ($)
|
Jun. 30, 2016
USD ($)
funds
subsidiaries
|
Jun. 30, 2015
USD ($)
|
Dec. 31, 2015
USD ($)
|
|
Variable Interest Entity [Line Items] | |||||
(Income) attributable to AlphaCat investors | $ 6,114 | $ 0 | $ 10,714 | $ 0 | |
Accounts payable and accrued expenses | |||||
Variable Interest Entity [Line Items] | |||||
(Income) attributable to AlphaCat investors | $ 13,126 | $ 2,412 | |||
Variable interest entities, primary beneficiary | |||||
Variable Interest Entity [Line Items] | |||||
Variable funding notes, typical minimum duration | 12 months | ||||
AlphaCat ILS funds | |||||
Variable Interest Entity [Line Items] | |||||
Number of AlphaCat ILS funds | funds | 1 | 1 | |||
AlphaCat ILS funds | Variable interest entities, primary beneficiary | |||||
Variable Interest Entity [Line Items] | |||||
Risk profile percentage | 7.00% | ||||
BetaCat ILS funds | Variable interest entities, primary beneficiary | |||||
Variable Interest Entity [Line Items] | |||||
Number of consolidated VIE BetaCat ILS funds | subsidiaries | 1 | 1 | |||
Structured Notes | |||||
Variable Interest Entity [Line Items] | |||||
Structured notes interest rate percentage | 8.00% |
Investments in affiliates (Summary of investments in affiliates) (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Schedule of Equity Method Investments [Line Items] | ||
Investments in affiliates | $ 99,278 | $ 88,065 |
Investment affiliate | ||
Schedule of Equity Method Investments [Line Items] | ||
Investments in affiliates | 99,278 | 87,673 |
Operating affiliate | ||
Schedule of Equity Method Investments [Line Items] | ||
Investments in affiliates | $ 0 | $ 392 |
Investments in affiliates (Investment affiliate rollforward) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Schedule of Equity Method Investments [Line Items] | ||||
(Loss) income from investment affiliate | $ (589) | $ 284 | $ (4,702) | $ 3,060 |
Investment affiliate | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Balance, beginning of period | 84,135 | 85,982 | 87,673 | 63,506 |
Capital contributions | 15,732 | 3,415 | 16,307 | 23,115 |
(Loss) income from investment affiliate | (589) | 284 | (4,702) | 3,060 |
Balance, end of period | $ 99,278 | $ 89,681 | $ 99,278 | $ 89,681 |
Investments in affiliates (Investment affiliate details) (Details) - Investment affiliate - USD ($) $ in Thousands |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2015 |
Jun. 30, 2015 |
Mar. 31, 2015 |
Dec. 31, 2014 |
---|---|---|---|---|---|---|
Schedule of Equity Method Investments [Line Items] | ||||||
Investment at cost | $ 86,101 | $ 69,794 | ||||
Carrying value | 99,278 | $ 84,135 | 87,673 | $ 89,681 | $ 85,982 | $ 63,506 |
Aquiline Financial Services Fund II LP | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investment at cost | $ 56,479 | $ 55,904 | ||||
Voting ownership % | 0.00% | 0.00% | ||||
Equity ownership % | 8.00% | 8.10% | ||||
Carrying value | $ 71,178 | $ 73,880 | ||||
Aquiline Financial Services Fund III LP | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investment at cost | $ 29,622 | $ 13,890 | ||||
Voting ownership % | 0.00% | 0.00% | ||||
Equity ownership % | 10.50% | 13.70% | ||||
Carrying value | $ 28,100 | $ 13,793 |
Investments in affiliates (Operating affiliates rollforward) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Activity in non-consolidated affiliate balances for the period: | ||||
(Loss) income from operating affiliate | $ 0 | $ 1,738 | $ (23) | $ 5,722 |
Operating affiliate | PacRe | ||||
Activity in non-consolidated affiliate balances for the period: | ||||
Balance, beginning of period | 369 | 54,928 | 392 | 50,944 |
Return of investment | (369) | 0 | (369) | 0 |
(Loss) income from operating affiliate | 0 | 1,738 | (23) | 5,722 |
Balance, end of period | $ 0 | $ 56,666 | $ 0 | $ 56,666 |
Investments in affiliates (Operating affiliates details) (Details) - Operating affiliate - PacRe - USD ($) $ in Thousands |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2015 |
Jun. 30, 2015 |
Mar. 31, 2015 |
Dec. 31, 2014 |
---|---|---|---|---|---|---|
Investment: | ||||||
Investment at cost | $ 0 | $ 392 | ||||
Voting ownership % | 100.00% | 100.00% | ||||
Equity ownership % | 10.00% | 10.00% | ||||
Carrying value | $ 0 | $ 369 | $ 392 | $ 56,666 | $ 54,928 | $ 50,944 |
Investments in affiliates (Narrative) (Details) - USD ($) $ in Thousands |
6 Months Ended | |||
---|---|---|---|---|
Nov. 07, 2014 |
Oct. 02, 2014 |
Dec. 20, 2011 |
Jun. 30, 2016 |
|
Aquiline Financial Services Fund II LP | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Percentage of Assignor's interest assumed | 100.00% | |||
Total capital commitment | $ 10,000 | $ 50,000 | ||
Investment Time Lag Reporting | 3 months | |||
Aquiline Financial Services Fund III LP | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Total capital commitment | $ 100,000 | |||
Investment Time Lag Reporting | 3 months |
Noncontrolling interest (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Noncontrolling Interest [Line Items] | ||||
Balance, beginning of period | $ 1,566,260 | $ 986,227 | $ 1,266,376 | $ 910,065 |
Issuance of shares | 171,849 | 258,900 | 552,924 | 462,300 |
Income attributable to noncontrolling interest | 21,193 | 22,561 | 58,724 | 40,739 |
Redemption of shares | (59,395) | (59,395) | ||
Redemptions payable | (6,484) | (6,500) | (6,484) | (6,500) |
Distributions | (8,381) | (12,759) | (127,103) | (158,175) |
Balance, end of period | 1,744,437 | 1,189,034 | 1,744,437 | 1,189,034 |
Redeemable noncontrolling interest | ||||
Noncontrolling Interest [Line Items] | ||||
Balance, beginning of period | 1,409,037 | 834,644 | 1,111,714 | 617,791 |
Issuance of shares | 112,500 | 249,300 | 381,250 | 452,700 |
Income attributable to noncontrolling interest | 17,230 | 17,462 | 45,803 | 30,915 |
Redemption of shares | (59,395) | (59,395) | ||
Redemptions payable | (6,484) | (6,500) | (6,484) | (6,500) |
Distributions | 0 | 0 | 0 | 0 |
Balance, end of period | 1,532,283 | 1,035,511 | 1,532,283 | 1,035,511 |
Noncontrolling interest | ||||
Noncontrolling Interest [Line Items] | ||||
Balance, beginning of period | 157,223 | 151,583 | 154,662 | 292,274 |
Issuance of shares | 59,349 | 9,600 | 171,674 | 9,600 |
Income attributable to noncontrolling interest | 3,963 | 5,099 | 12,921 | 9,824 |
Redemption of shares | 0 | 0 | ||
Redemptions payable | 0 | 0 | 0 | 0 |
Distributions | (8,381) | (12,759) | (127,103) | (158,175) |
Balance, end of period | $ 212,154 | $ 153,523 | $ 212,154 | $ 153,523 |
Derivative instruments (Amount and balance sheet location) (Details) $ in Thousands |
Jun. 30, 2016
USD ($)
derivatives
|
Dec. 31, 2015
USD ($)
|
|||||
---|---|---|---|---|---|---|---|
Not designated as hedging instruments | Foreign exchange contracts | |||||||
Summary of amount of derivatives designated as hedging instruments | |||||||
Net Notional Exposure | $ 297,275 | $ 255,840 | |||||
Not designated as hedging instruments | Foreign exchange contracts | Other assets | |||||||
Summary of amount of derivatives designated as hedging instruments | |||||||
Fair value, derivative assets | [1] | 4,230 | 2,601 | ||||
Not designated as hedging instruments | Foreign exchange contracts | Accounts payable and accrued expenses | |||||||
Summary of amount of derivatives designated as hedging instruments | |||||||
Fair value, derivative liabilities | [1] | 4,746 | 3,211 | ||||
Designated as hedging instruments | Interest rate swap contracts | |||||||
Summary of amount of derivatives designated as hedging instruments | |||||||
Net Notional Exposure | 552,263 | 552,263 | |||||
Designated as hedging instruments | Interest rate swap contracts | Other assets | |||||||
Summary of amount of derivatives designated as hedging instruments | |||||||
Fair value, derivative assets | [2] | 20 | 21 | ||||
Designated as hedging instruments | Interest rate swap contracts | Accounts payable and accrued expenses | |||||||
Summary of amount of derivatives designated as hedging instruments | |||||||
Fair value, derivative liabilities | [2] | $ 2,529 | $ 1,942 | ||||
Junior Subordinated Deferrable Debentures | Interest rate swap contracts | |||||||
Summary of amount of derivatives designated as hedging instruments | |||||||
Derivative, number of instruments held | derivatives | 2 | ||||||
Flagstone Junior Subordinated Deferrable Debentures | Interest rate swap contracts | |||||||
Summary of amount of derivatives designated as hedging instruments | |||||||
Derivative, number of instruments held | derivatives | 3 | ||||||
Flagstone Junior Subordinated Deferrable Debentures | Cross-currency interest rate swap | |||||||
Summary of amount of derivatives designated as hedging instruments | |||||||
Derivative, number of instruments held | derivatives | 1 | ||||||
|
Derivative instruments (Amount included in statement of operations) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Not designated as hedging instruments | Other income | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | $ 84 | $ (128) | $ 120 | $ (127) |
Not designated as hedging instruments | Foreign exchange gains (losses) | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 896 | 0 | (1,117) | 0 |
Designated as hedging instruments | Fair value hedge | Foreign exchange contracts | Foreign exchange gains (losses) | ||||
Derivatives designated as fair value hedges and related hedged item | ||||
Amount of loss recognized in income on derivative | 0 | (8,954) | 0 | (15,156) |
Amount of gain on hedged item recognized in income attributable to risk being hedged | 0 | 8,954 | 0 | 15,156 |
Amount of gain recognized in income on derivative (ineffective portion) | 0 | 0 | 0 | 0 |
Designated as hedging instruments | Cash flow hedge | Interest rate swap contracts | ||||
Derivative instruments designated as a cash flow hedge | ||||
Amount of ineffective portion excluded from effectiveness testing | 64 | 390 | (694) | (411) |
Designated as hedging instruments | Cash flow hedge | Interest rate swap contracts | Other comprehensive income | ||||
Derivative instruments designated as a cash flow hedge | ||||
Amount of effective portion recognized in other comprehensive income | 2,694 | 2,846 | 6,350 | 6,886 |
Designated as hedging instruments | Cash flow hedge | Interest rate swap contracts | Finance expenses | ||||
Derivative instruments designated as a cash flow hedge | ||||
Amount of effective portion subsequently reclassified to earnings | $ (2,758) | $ (3,236) | $ (5,656) | $ (6,475) |
Reserve for losses and loss expenses (Reserve rollforward) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
||||
Reserve for paid losses and unpaid loss expenses | |||||||
Reserve for losses and loss expenses, beginning of period | $ 2,980,300 | $ 3,207,885 | $ 2,996,567 | $ 3,243,147 | |||
Losses and loss expenses recoverable, beginning of period | (370,689) | (375,882) | (350,586) | (377,466) | |||
Net reserves for losses and loss expenses, beginning of period | 2,609,611 | 2,832,003 | 2,645,981 | 2,865,681 | |||
Increase (decrease) in net losses and loss expenses incurred in respect of losses occurring in: | |||||||
Current year | 369,911 | 336,864 | 648,097 | 661,352 | |||
Prior years | [1] | (62,781) | (70,718) | (116,520) | (154,277) | ||
Total incurred losses and loss expenses | 307,130 | 266,146 | 531,577 | 507,075 | |||
Less net losses and loss expenses paid in respect of losses occurring in: | |||||||
Current year | (45,882) | (28,965) | (61,655) | (42,065) | |||
Prior years | (176,775) | (260,027) | (430,079) | (496,260) | |||
Total net paid losses | (222,657) | (288,992) | (491,734) | (538,325) | |||
Foreign exchange (gain) loss | (14,354) | 6,841 | (6,094) | (18,433) | |||
Net reserve for losses and loss expenses, end of period | 2,679,730 | 2,815,998 | 2,679,730 | 2,815,998 | |||
Losses and loss expenses recoverable, end of period | 442,987 | 376,665 | 442,987 | 376,665 | |||
Reserve for losses and loss expenses, end of period | 3,122,717 | 3,192,663 | 3,122,717 | 3,192,663 | |||
Components of incurred losses and loss expenses | |||||||
Gross losses and loss expenses (a) | [1] | 397,863 | 303,771 | 667,716 | 568,567 | ||
Reinsurance recoverable | (90,733) | (37,625) | (136,139) | (61,492) | |||
Net incurred losses and loss expenses (a) | [1] | $ 307,130 | $ 266,146 | $ 531,577 | $ 507,075 | ||
|
Reserve for losses and loss expenses (Prior year development) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | [1] | $ (62,781) | $ (70,718) | $ (116,520) | $ (154,277) | |||
Validus Re | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (30,877) | (30,879) | (56,561) | (55,575) | ||||
Talbot | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (28,328) | (35,586) | (51,048) | (87,273) | ||||
Western World | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (3,158) | (4,253) | [1] | (7,584) | (10,585) | [1] | ||
AlphaCat | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (418) | (1,327) | (844) | |||||
Property | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (21,440) | (33,477) | [1] | (63,340) | (72,697) | [1] | ||
Property | Validus Re | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (9,468) | (15,928) | (32,300) | (30,824) | ||||
Property | Talbot | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (10,094) | (16,683) | (28,540) | (37,435) | ||||
Property | Western World | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (1,582) | (866) | [1] | (2,023) | (3,594) | [1] | ||
Property | AlphaCat | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (296) | (477) | (844) | |||||
Marine | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (18,946) | (24,909) | [1] | (12,427) | (51,993) | [1] | ||
Marine | Validus Re | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (10,018) | (11,099) | (6,463) | (15,669) | ||||
Marine | Talbot | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (8,928) | (13,810) | (5,964) | (36,324) | ||||
Specialty | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (20,819) | (8,945) | [1] | (35,192) | (22,596) | [1] | ||
Specialty | Validus Re | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (11,391) | (3,852) | (17,798) | (9,082) | ||||
Specialty | Talbot | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (9,306) | (5,093) | (16,544) | (13,514) | ||||
Specialty | AlphaCat | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (122) | (850) | 0 | |||||
Liability | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | (1,576) | (3,387) | [1] | (5,561) | (6,991) | [1] | ||
Liability | Western World | ||||||||
Increase (decrease) in net reserves for losses and loss expenses in respect of losses occurring in: | ||||||||
Net favorable development on prior years | $ (1,576) | $ (3,387) | [1] | $ (5,561) | $ (6,991) | [1] | ||
|
Reserve for losses and loss expenses (Narrative) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2015 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||||
Liability for Unpaid Claims and Claims Adjustment Expense, Reported Claims, Amount | $ 1,267,625 | $ 1,278,697 | |||
Liability for Unpaid Claims and Claims Adjustment Expense, Incurred but Not Reported (IBNR) Claims, Amount | $ 1,855,092 | 1,717,870 | |||
Western World | |||||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||||
Fair value adjustment to net reserves | $ 15,586 | ||||
Amortized to income during the period | $ 2,892 | $ 6,115 | |||
Prior Year Development Percentage | 4.40% | 4.60% | |||
Remaining amount of fair value adjustments to loss reserves to be amortized during the period | $ 4,864 |
Reinsurance (Details) - USD ($) $ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2016 |
Dec. 31, 2015 |
|
Reinsurance (Textuals) [Abstract] | ||
Incurred but not reported recoverable | $ 291,536 | $ 214,863 |
Provision for uncollectible reinsurance relating to losses recoverable | 5,025 | 4,997 |
Reinsurance Recoverable | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 470,635 | $ 373,657 |
Percentage of total | 100.00% | 100.00% |
Reinsurance Recoverable | A- or better | ||
Ceded Credit Risk [Line Items] | ||
Percentage of total | 98.70% | 98.70% |
Reinsurance Recoverable | Top 10 reinsurers | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 391,076 | $ 303,108 |
Percentage of total | 83.10% | 81.10% |
Reinsurance Recoverable | Top 10 reinsurers | Fully collateralized reinsurers | NR | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 80,829 | |
Percentage of total | 17.20% | |
Reinsurance Recoverable | Top 10 reinsurers | Swiss Re | AA- | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 80,604 | $ 83,048 |
Percentage of total | 17.10% | 22.20% |
Reinsurance Recoverable | Top 10 reinsurers | Lloyds Syndicates | A plus | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 79,508 | $ 66,356 |
Percentage of total | 16.90% | 17.80% |
Reinsurance Recoverable | Top 10 reinsurers | Hannover Re | AA- | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 47,686 | $ 43,765 |
Percentage of total | 10.10% | 11.70% |
Reinsurance Recoverable | Top 10 reinsurers | Everest Re | A plus | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 42,506 | $ 43,060 |
Percentage of total | 9.00% | 11.50% |
Reinsurance Recoverable | Top 10 reinsurers | Munich Re | AA- | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 18,161 | $ 18,707 |
Percentage of total | 3.90% | 5.00% |
Reinsurance Recoverable | Top 10 reinsurers | Transatlantic Re | A plus | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 11,719 | $ 11,923 |
Percentage of total | 2.50% | 3.20% |
Reinsurance Recoverable | Top 10 reinsurers | Hamilton Re | A- | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 11,623 | $ 10,898 |
Percentage of total | 2.50% | 2.90% |
Reinsurance Recoverable | Top 10 reinsurers | National Indemnity Company | AA plus | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 9,565 | $ 10,293 |
Percentage of total | 2.00% | 2.80% |
Reinsurance Recoverable | Top 10 reinsurers | Toa Re | A plus | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 8,875 | $ 6,330 |
Percentage of total | 1.90% | 1.70% |
Reinsurance Recoverable | Top 10 reinsurers | XL Re | A plus | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 8,728 | |
Percentage of total | 2.30% | |
Reinsurance Recoverable | Other reinsurers' balances greater than $1 million | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 70,763 | $ 61,222 |
Percentage of total | 15.00% | 16.40% |
Reinsurance Recoverable | Other reinsurers' balances less than $1 million | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverable | $ 8,796 | $ 9,327 |
Percentage of total | 1.90% | 2.50% |
Share capital (Common stock) (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Feb. 03, 2015 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Jun. 30, 2015 |
Mar. 31, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Schedule of Common Stock Issued and Outstanding [Line Items] | |||||||
Authorized share capital | 571,428,571 | 571,428,571 | |||||
Share Capital (Narrative) | |||||||
Common shares, par value | $ 0.175 | $ 0.175 | |||||
Common stock voting rights | one vote per share | ||||||
Restriction on percentage of voting power | 9.09% | ||||||
Share repurchases | |||||||
Common share repurchase authorization | $ 750,000 | ||||||
Share repurchase program, cumulative shares repurchased | 78,841,758 | ||||||
Shares repurchased, cumulative | $ 2,274,401 | $ 2,620,814 | |||||
Remaining share repurchase authorization amount | $ 403,587 | $ 403,587 | |||||
Cash dividends declared per share | $ 0.35 | $ 0.32 | $ 0.7 | $ 0.64 | |||
Summary of common shares issued and outstanding | |||||||
Common shares issued, beginning balance | 160,570,772 | 155,554,224 | 160,570,772 | 155,554,224 | |||
Options exercised (in shares) | 13,635 | 728,489 | |||||
Warrants exercised (in shares) | 1,461,715 | ||||||
Common shares issued, ending balance | 161,252,871 | 158,379,505 | 161,252,871 | 158,379,505 | |||
Treasury shares, ending balance | (80,480,633) | (75,083,710) | (80,480,633) | (75,083,710) | |||
Common shares outstanding, ending balance | 80,772,238 | 83,295,795 | 80,772,238 | 83,295,795 | |||
Common shares | |||||||
Share repurchases | |||||||
Cash dividends declared per share | $ 0.35 | $ 0.35 | $ 0.32 | $ 0.32 | |||
Summary of common shares issued and outstanding | |||||||
Direct issuance of common stock (in shares) | 639 | ||||||
Performance shares | |||||||
Summary of common shares issued and outstanding | |||||||
Vested, net of shares withheld | 48,088 | 11,524 | |||||
Restricted share awards | |||||||
Summary of common shares issued and outstanding | |||||||
Vested, net of shares withheld | 601,890 | 609,654 | |||||
Restricted share units | |||||||
Summary of common shares issued and outstanding | |||||||
Vested, net of shares withheld | 18,486 | 13,260 |
Share capital (Preferred stock) (Details) - USD ($) |
6 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Class of Stock [Line Items] | ||
Preferred shares, shares issued at beginning of period | 0 | |
Preferred shares, shares outstanding at beginning of period | 0 | |
Preferred shares, shares issued at end of period | 6,000 | |
Preferred shares, shares outstanding at end of period | 6,000 | |
Preferred shares - Shareholders' Equity | ||
Preferred shares equivalent depositary shares number | 6,000,000 | |
Net proceeds on issuance of preferred shares | $ 144,852,000 | $ 0 |
Proportionate interest of Series A Preferred shares, per depositary share | 0.10% | |
Preferred shares | ||
Class of Stock [Line Items] | ||
Preferred shares, shares issued at beginning of period | 0 | |
Preferred shares, shares outstanding at beginning of period | 0 | |
Preferred shares issued | 6,000 | |
Preferred shares, shares issued at end of period | 6,000 | |
Preferred shares, shares outstanding at end of period | 6,000 | |
Preferred shares - Shareholders' Equity | ||
Preferred shares, dividend rate, percentage | 5.875% | |
Preferred stock, par or stated value per share | $ 0.175 | |
Preferred stock, liquidation preference, value | $ 25,000 | |
Depositary share equivalent | ||
Preferred shares - Shareholders' Equity | ||
Preferred stock, liquidation preference, value | $ 25 | |
Prior to redemption date | Preferred shares | ||
Preferred shares - Shareholders' Equity | ||
Preferred stock, redemption price per share | $ 26,000 | |
Prior to redemption date | Depositary share equivalent | ||
Preferred shares - Shareholders' Equity | ||
Preferred stock, redemption price per share | 26 | |
On or after June 15, 2021 | Preferred shares | ||
Preferred shares - Shareholders' Equity | ||
Preferred stock, redemption price per share | 25,000 | |
On or after June 15, 2021 | Depositary share equivalent | ||
Preferred shares - Shareholders' Equity | ||
Preferred stock, redemption price per share | 25 | |
Before redemption date if change in law or capital disqualification event | Preferred shares | ||
Preferred shares - Shareholders' Equity | ||
Preferred stock, redemption price per share | 25,000 | |
Before redemption date if change in law or capital disqualification event | Depositary share equivalent | ||
Preferred shares - Shareholders' Equity | ||
Preferred stock, redemption price per share | $ 25 |
Stock plans (Options activity) (Details) - $ / shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Options activities: | ||
Options outstanding, beginning balance (in shares) | 65,401 | 1,160,057 |
Options exercised during period (in shares) | (14,044) | (1,040,680) |
Options outstanding, ending balance (in shares) | 51,357 | 119,377 |
Weighted Average Grant Date Fair Value | ||
Weighted average grant date fair value, beginning balance (in dollars per share) | $ 7.74 | $ 7.12 |
Weighted average grant date fair value, options exercised (in dollars per share) | 7.69 | 7.26 |
Weighted average grant date fair value, ending balance (in dollars per share) | 7.75 | 5.94 |
Weighted Average Grant Date Exercise Price | ||
Weighted average grant date exercise price, beginning balance (in dollars per share) | 20.17 | 17.74 |
Weighted average grant date exercise price, options exercised (in dollars per share) | 17.02 | 16.86 |
Weighted average grant date exercise price, ending balance (in dollars per share) | $ 21.03 | $ 25.46 |
Stock plans (Other awards activity) (Details) - $ / shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Restricted share awards | ||
Activities | ||
Beginning balance (in shares) | 2,739,446 | 2,858,711 |
Granted (in shares) | 534,905 | 670,432 |
Vested (in shares) | (783,523) | (781,704) |
Forfeited (in shares) | (8,317) | (51,818) |
Ending balance (in shares) | 2,482,511 | 2,695,621 |
Weighted average grant date fair value | ||
Weighted average grant date fair value, beginning balance (in dollars per share) | $ 38.25 | $ 35.81 |
Weighted average grant date fair value, granted (in dollars per share) | 48.69 | 43.55 |
Weighted average grant date fair value, vested (in dollars per share) | 37.32 | 34.42 |
Weighted average grant date fair value, forfeited (in dollars per share) | 37.94 | 38.04 |
Weighted average grant date fair value, ending balance (in dollars per share) | $ 40.79 | $ 38.09 |
Restricted share units | ||
Activities | ||
Beginning balance (in shares) | 114,337 | 103,484 |
Granted (in shares) | 20,129 | 28,057 |
Vested (in shares) | (23,982) | (19,455) |
Issued in lieu of cash dividends (in shares) | 1,629 | 1,517 |
Forfeited (in shares) | (892) | |
Ending balance (in shares) | 112,113 | 112,711 |
Weighted average grant date fair value | ||
Weighted average grant date fair value, beginning balance (in dollars per share) | $ 38.47 | $ 36.54 |
Weighted average grant date fair value, granted (in dollars per share) | 48.69 | 42.91 |
Weighted average grant date fair value, vested (in dollars per share) | 38.18 | 34.58 |
Weighted average grant date fair value, issued in lieu of cash dividends (in dollars per share) | 38.47 | 36.53 |
Weighted average grant date fair value, forfeited (in dollars per share) | 35.42 | |
Weighted average grant date fair value, ending balance (in dollars per share) | $ 40.37 | $ 38.47 |
Performance shares | ||
Activities | ||
Beginning balance (in shares) | 172,594 | 106,369 |
Granted (in shares) | 121,844 | 81,569 |
Vested (in shares) | (57,581) | (15,344) |
Conversion adjustment (in shares) | 45,517 | |
Ending balance (in shares) | 282,374 | 172,594 |
Weighted average grant date fair value | ||
Weighted average grant date fair value, beginning balance (in dollars per share) | $ 40.70 | $ 36.03 |
Weighted average grant date fair value, granted (in dollars per share) | 48.69 | 45.03 |
Weighted average grant date fair value, vested (in dollars per share) | 36.11 | 31.38 |
Weighted average grant date fair value, conversion adjustment (in dollars per share) | 36.82 | |
Weighted average grant date fair value, ending balance (in dollars per share) | $ 44.46 | $ 40.70 |
Stock plans (Components of share compensation expenses) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Total share compensation expenses | ||||
Share compensation expenses | $ 10,727 | $ 9,242 | $ 21,964 | $ 18,296 |
Restricted share awards | ||||
Total share compensation expenses | ||||
Share compensation expenses | 9,517 | 8,653 | 18,646 | 17,132 |
Restricted share units | ||||
Total share compensation expenses | ||||
Share compensation expenses | 377 | 279 | 688 | 541 |
Performance shares | ||||
Total share compensation expenses | ||||
Share compensation expenses | $ 833 | $ 310 | $ 2,630 | $ 623 |
Stock plans (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Dec. 31, 2015 |
|
Stock plans (other details) | |||||
Number of shares reserved for issuance under the LTIP and STIP | 2,753,292 | 2,753,292 | |||
Remaining number of shares reserved for issuance | 1,256,215 | 1,256,215 | |||
Share compensation expenses | $ 10,727 | $ 9,242 | $ 21,964 | $ 18,296 | |
Options exercised during period (in shares) | (14,044) | (1,040,680) | |||
Share Based Compensation Arrangement By Share Based Payment Award Options Exercised In Period Weighted Average Grant Date Fair Value | $ 7.69 | $ 7.26 | |||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $ 17.02 | $ 16.86 | |||
Options | |||||
Stock plans (other details) | |||||
Life of options | 10 years | ||||
Restricted share awards | |||||
Stock plans (other details) | |||||
Share compensation expenses | 9,517 | 8,653 | $ 18,646 | $ 17,132 | |
Unrecognized share compensation expenses | 76,049 | $ 76,049 | $ 69,143 | ||
Weighted average period of recognizing share based compensation expenses | 2 years 7 months 9 days | 2 years 4 months 24 days | |||
Restricted share units | |||||
Stock plans (other details) | |||||
Share compensation expenses | 377 | 279 | $ 688 | 541 | |
Unrecognized share compensation expenses | 3,079 | $ 3,079 | $ 2,790 | ||
Weighted average period of recognizing share based compensation expenses | 2 years 8 months 8 days | 2 years 7 months | |||
Performance shares | |||||
Stock plans (other details) | |||||
Share compensation expenses | 833 | $ 310 | $ 2,630 | $ 623 | |
Unrecognized share compensation expenses | $ 8,719 | $ 8,719 | $ 4,011 | ||
Weighted average period of recognizing share based compensation expenses | 2 years 5 months 15 days | 2 years 1 month 6 days | |||
Performance share awards performance period | 3 years |
Debt and financing arrangements (Schedule of finance structure) (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
|||
---|---|---|---|---|---|
Debt Instruments [Line Items] | |||||
Debt instrument, commitment | $ 848,187 | $ 847,868 | |||
Debt instrument, issued and outstanding | [1] | 787,987 | 787,668 | ||
Debt instrument, drawn | 783,248 | 782,829 | |||
Credit facility, commitment | 690,000 | 700,000 | |||
Credit facility, issued and outstanding | [1] | 338,668 | 479,088 | ||
Total debt and financing arrangements, commitment | 1,538,187 | 1,547,868 | |||
Total debt and financing arrangements, issued and outstanding | [1] | 1,126,655 | 1,266,756 | ||
$85,000 syndicated unsecured letter of credit facility | |||||
Debt Instruments [Line Items] | |||||
Credit facility, commitment | 85,000 | 85,000 | |||
Credit facility, issued and outstanding | [1] | 0 | 0 | ||
$300,000 syndicated secured letter of credit facility | |||||
Debt Instruments [Line Items] | |||||
Credit facility, commitment | 300,000 | 300,000 | |||
Credit facility, issued and outstanding | [1] | 105,575 | 235,540 | ||
$24,000 secured bi-lateral letter of credit facility | |||||
Debt Instruments [Line Items] | |||||
Credit facility, commitment | 24,000 | 24,000 | |||
Credit facility, issued and outstanding | [1] | 11,805 | 10,543 | ||
AlphaCat Re secured letter of credit facility | |||||
Debt Instruments [Line Items] | |||||
Credit facility, commitment | 20,000 | 30,000 | |||
Credit facility, issued and outstanding | [1] | 20,000 | 30,000 | ||
$25,000 IPC bi-lateral facility | |||||
Debt Instruments [Line Items] | |||||
Credit facility, commitment | 25,000 | 25,000 | |||
Credit facility, issued and outstanding | [1] | 5,666 | 9,241 | ||
$236,000 Flagstone bi-lateral facility | |||||
Debt Instruments [Line Items] | |||||
Credit facility, commitment | 236,000 | 236,000 | |||
Credit facility, issued and outstanding | [1] | 195,622 | 193,764 | ||
Total debentures payable | |||||
Debt Instruments [Line Items] | |||||
Debt instrument, commitment | 598,187 | 597,868 | |||
Debt instrument, issued and outstanding | [1] | 537,987 | 537,668 | ||
Debt instrument, drawn | 537,987 | 537,668 | |||
2006 Junior Subordinated Deferrable Debentures | |||||
Debt Instruments [Line Items] | |||||
Debt instrument, commitment | 150,000 | 150,000 | |||
Debt instrument, issued and outstanding | [1] | 150,000 | 150,000 | ||
Debt instrument, drawn | 150,000 | 150,000 | |||
2007 Junior Subordinated Deferrable Debentures | |||||
Debt Instruments [Line Items] | |||||
Debt instrument, commitment | 200,000 | 200,000 | |||
Debt instrument, issued and outstanding | [1] | 139,800 | 139,800 | ||
Debt instrument, drawn | 139,800 | 139,800 | |||
Flagstone 2006 Junior Subordinated Deferrable Debentures | |||||
Debt Instruments [Line Items] | |||||
Debt instrument, commitment | 134,437 | 134,118 | |||
Debt instrument, issued and outstanding | [1] | 134,437 | 134,118 | ||
Debt instrument, drawn | 134,437 | 134,118 | |||
Flagstone 2007 Junior Subordinated Deferrable Debentures | |||||
Debt Instruments [Line Items] | |||||
Debt instrument, commitment | 113,750 | 113,750 | |||
Debt instrument, issued and outstanding | [1] | 113,750 | 113,750 | ||
Debt instrument, drawn | 113,750 | 113,750 | |||
2010 Senior Notes Due 2040 | |||||
Debt Instruments [Line Items] | |||||
Debt instrument, commitment | 250,000 | 250,000 | |||
Debt instrument, issued and outstanding | [1] | 250,000 | 250,000 | ||
Debt instrument, drawn | $ 245,261 | $ 245,161 | |||
|
Debt and financing arrangements (Summary of notes and debentures) (Details) - USD ($) $ in Thousands |
6 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2016 |
Dec. 31, 2015 |
||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Commitment | $ 848,187 | $ 847,868 | |||||||||||
2006 Junior Subordinated Deferrable Debentures | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Issuance date | Jun. 15, 2006 | ||||||||||||
Commitment | $ 150,000 | 150,000 | |||||||||||
Maturity date | Jun. 15, 2036 | ||||||||||||
Interest payments due | Quarterly | ||||||||||||
Flagstone 2006 Junior Subordinated Deferrable Interest Notes | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Issuance date | Aug. 23, 2006 | ||||||||||||
Commitment | $ 134,437 | 134,118 | |||||||||||
Maturity date | Sep. 15, 2036 | ||||||||||||
Interest payments due | Quarterly | ||||||||||||
2007 Junior Subordinated Deferrable Debentures | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Issuance date | Jun. 21, 2007 | ||||||||||||
Commitment | $ 200,000 | 200,000 | |||||||||||
Maturity date | Jun. 15, 2037 | ||||||||||||
Interest payments due | Quarterly | ||||||||||||
Flagstone 2007 Due July 30 2037 | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Issuance date | Jun. 08, 2007 | ||||||||||||
Commitment | $ 88,750 | ||||||||||||
Maturity date | Jul. 30, 2037 | ||||||||||||
Interest payments due | Quarterly | ||||||||||||
Flagstone 2007 Debt Due September 15 2037 | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Issuance date | Sep. 20, 2007 | ||||||||||||
Commitment | $ 25,000 | ||||||||||||
Maturity date | Sep. 15, 2037 | ||||||||||||
Interest payments due | Quarterly | ||||||||||||
2010 Senior Notes Due 2040 | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Issuance date | Jan. 26, 2010 | ||||||||||||
Commitment | $ 250,000 | $ 250,000 | |||||||||||
Maturity date | Jan. 26, 2040 | ||||||||||||
Interest payments due | Semi-annually in arrears | ||||||||||||
At Issuance | 2006 Junior Subordinated Deferrable Debentures | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Fixed interest rate (in percent) | [1] | 9.069% | |||||||||||
At Issuance | 2006 Junior Subordinated Deferrable Debentures | Three month LIBOR | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Spread on variable rate (in percent) | 3.55% | ||||||||||||
At Issuance | Flagstone 2006 Junior Subordinated Deferrable Interest Notes | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Spread on variable rate (in percent) | [2] | 3.54% | |||||||||||
At Issuance | 2007 Junior Subordinated Deferrable Debentures | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Fixed interest rate (in percent) | [3] | 8.48% | |||||||||||
At Issuance | 2007 Junior Subordinated Deferrable Debentures | Three month LIBOR | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Spread on variable rate (in percent) | 2.95% | ||||||||||||
At Issuance | Flagstone 2007 Due July 30 2037 | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Spread on variable rate (in percent) | [2] | 3.00% | |||||||||||
At Issuance | Flagstone 2007 Debt Due September 15 2037 | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Spread on variable rate (in percent) | [2] | 3.10% | |||||||||||
At Issuance | 2010 Senior Notes Due 2040 | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Fixed interest rate (in percent) | [4] | 8.875% | |||||||||||
Outstanding | 2006 Junior Subordinated Deferrable Debentures | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Effective percentage | [5] | 5.831% | |||||||||||
Outstanding | Flagstone 2006 Junior Subordinated Deferrable Interest Notes | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Effective percentage | [5] | 6.463% | |||||||||||
Outstanding | 2007 Junior Subordinated Deferrable Debentures | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Effective percentage | [5] | 5.18% | |||||||||||
Outstanding | Flagstone 2007 Due July 30 2037 | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Effective percentage | [5] | 5.90% | |||||||||||
Outstanding | Flagstone 2007 Debt Due September 15 2037 | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Effective percentage | [5] | 5.983% | |||||||||||
Outstanding | 2010 Senior Notes Due 2040 | |||||||||||||
Debt Instruments [Line Items] | |||||||||||||
Fixed interest rate (in percent) | [4] | 8.875% | |||||||||||
|
Debt and financing arrangements (Components of finance expenses) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
||||||
Debt Instruments [Line Items] | |||||||||
Finance expenses | $ 14,166 | $ 18,682 | $ 29,369 | $ 39,649 | |||||
Credit facilities | |||||||||
Debt Instruments [Line Items] | |||||||||
Finance expenses | 235 | 1,193 | 896 | 2,900 | |||||
Bank charges, Talbot FAL facility and other charges | |||||||||
Debt Instruments [Line Items] | |||||||||
Finance expenses | [1] | 206 | 1,252 | 213 | 2,459 | ||||
AlphaCat fees | |||||||||
Debt Instruments [Line Items] | |||||||||
Finance expenses | [2] | 77 | 2,581 | 961 | 7,065 | ||||
2006 Junior Subordinated Deferrable Debentures | |||||||||
Debt Instruments [Line Items] | |||||||||
Finance expenses | 2,211 | 2,211 | 4,422 | 4,398 | |||||
2007 Junior Subordinated Deferrable Debentures | |||||||||
Debt Instruments [Line Items] | |||||||||
Finance expenses | 1,830 | 1,835 | 3,661 | 3,644 | |||||
Flagstone 2006 Junior Subordinated Deferrable Debentures | |||||||||
Debt Instruments [Line Items] | |||||||||
Finance expenses | 2,244 | 2,243 | 4,489 | 4,461 | |||||
Flagstone 2007 Junior Subordinated Deferrable Debentures | |||||||||
Debt Instruments [Line Items] | |||||||||
Finance expenses | 1,766 | 1,770 | 3,533 | 3,528 | |||||
2010 Senior Notes Due 2040 | |||||||||
Debt Instruments [Line Items] | |||||||||
Finance expenses | $ 5,597 | $ 5,597 | $ 11,194 | $ 11,194 | |||||
|
Debt and financing arrangements (Narrative) (Details) - USD ($) $ in Thousands |
6 Months Ended | ||||
---|---|---|---|---|---|
Jun. 30, 2016 |
Dec. 31, 2015 |
||||
Senior Notes and Junior Debentures | |||||
Long-term Debt | $ 537,987 | $ 537,668 | |||
Credit Facilities | |||||
Credit facility, commitment | 690,000 | 700,000 | |||
Credit facility, issued and outstanding | [1] | 338,668 | 479,088 | ||
$85,000 syndicated unsecured letter of credit facility | |||||
Credit Facilities | |||||
Credit facility, commitment | $ 85,000 | 85,000 | |||
Line of credit facility initiation date | Dec. 09, 2015 | ||||
Letter of credit facility period | 5 years | ||||
Aggregate commitments, maximum | $ 150,000 | ||||
Credit facility, issued and outstanding | [1] | 0 | 0 | ||
$300,000 syndicated secured letter of credit facility | |||||
Credit Facilities | |||||
Credit facility, commitment | $ 300,000 | 300,000 | |||
Line of credit facility initiation date | Dec. 09, 2015 | ||||
Letter of credit facility period | 5 years | ||||
Aggregate commitments, maximum | $ 400,000 | ||||
Credit facility, issued and outstanding | [1] | 105,575 | 235,540 | ||
Five year credit facilities | |||||
Credit Facilities | |||||
Minimum level of consolidated net worth | $ 2,600,000 | ||||
Percent of consolidated net income quarterly increase under covenant | 25.00% | ||||
Percent of any net proceeds from issuance of common shares | 50.00% | ||||
Ratio consolidated total debt to net worth under covenant | 0.35:1.00 | ||||
$25,000 IPC bi-lateral facility | |||||
Credit Facilities | |||||
Credit facility, commitment | $ 25,000 | 25,000 | |||
Credit facility, issued and outstanding | [1] | 5,666 | 9,241 | ||
$24,000 secured bi-lateral letter of credit facility | |||||
Credit Facilities | |||||
Credit facility, commitment | 24,000 | 24,000 | |||
Credit facility, issued and outstanding | [1] | 11,805 | 10,543 | ||
AlphaCat Re secured letter of credit facility | |||||
Credit Facilities | |||||
Credit facility, commitment | 20,000 | 30,000 | |||
Credit facility, issued and outstanding | [1] | 20,000 | 30,000 | ||
$236,000 Flagstone bi-lateral facility | |||||
Credit Facilities | |||||
Credit facility, commitment | 236,000 | 236,000 | |||
Credit facility, issued and outstanding | [1] | 195,622 | $ 193,764 | ||
2010 Senior Notes Due 2040 | |||||
Senior Notes and Junior Debentures | |||||
Long-term Debt | $ 250,000 | ||||
2010 Senior Notes Due 2040 | Minimum | |||||
Senior Notes and Junior Debentures | |||||
Debt Instrument Redemption Required Notice Period | 30 days | ||||
2010 Senior Notes Due 2040 | Maximum | |||||
Senior Notes and Junior Debentures | |||||
Debt Instrument Redemption Required Notice Period | 60 days | ||||
Junior subordinated deeferrable debentures | |||||
Senior Notes and Junior Debentures | |||||
Long-term Debt | $ 537,987 | ||||
Debt Instrument Redemption Period Duration | 5 years | ||||
At Issuance | 2006 Junior Subordinated Deferrable Debentures | |||||
Debt and financing arrangements [Line Items] | |||||
Interest Rate Term | 5 years | ||||
At Issuance | 2007 Junior Subordinated Deferrable Debentures | |||||
Debt and financing arrangements [Line Items] | |||||
Interest Rate Term | 5 years | ||||
Three month LIBOR | At Issuance | 2006 Junior Subordinated Deferrable Debentures | |||||
Debt and financing arrangements [Line Items] | |||||
Spread on variable rate (in percent) | 3.55% | ||||
Three month LIBOR | At Issuance | 2007 Junior Subordinated Deferrable Debentures | |||||
Debt and financing arrangements [Line Items] | |||||
Spread on variable rate (in percent) | 2.95% | ||||
|
Accumulated other comprehensive loss (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance, beginning of period, net of tax | $ (15,438) | $ (12,641) | $ (12,569) | $ (8,556) |
Net current period other comprehensive loss, net of tax | (2,744) | 3,575 | (5,613) | (510) |
Balance, end of period, net of tax | (18,182) | (9,066) | (18,182) | (9,066) |
Foreign currency translation adjustment | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance, beginning of period, net of tax | (13,862) | (11,137) | (11,834) | (8,118) |
Net current period other comprehensive loss, net of tax | (3,287) | 2,763 | (5,315) | (256) |
Balance, end of period, net of tax | (17,149) | (8,374) | (17,149) | (8,374) |
Minimum pension liability | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance, beginning of period, net of tax | 251 | (475) | 334 | (210) |
Net current period other comprehensive loss, net of tax | 479 | 422 | 396 | 157 |
Balance, end of period, net of tax | 730 | (53) | 730 | (53) |
Cash flow hedge | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance, beginning of period, net of tax | (1,827) | (1,029) | (1,069) | (228) |
Net current period other comprehensive loss, net of tax | 64 | 390 | (694) | (411) |
Balance, end of period, net of tax | $ (1,763) | $ (639) | $ (1,763) | $ (639) |
Commitments and contingencies (Lloyd's syndicate) (Details) - 6 months ended Jun. 30, 2016 - Lloyd's Syndicate 1183 £ in Thousands, $ in Thousands |
USD ($) |
GBP (£) |
---|---|---|
Funds at Lloyd's and Lloyd's Central Fund | ||
Maximum premium levies assessable, percent | 3.00% | 3.00% |
Estimated underwriting capacity | £ | £ 600,000 | |
Exchange rate | £1 equals $1.33 | £1 equals $1.33 |
Maximum premium levies assessable, amount | $ 23,940 | |
2016 Underwriting year | ||
Components Of Required Capital [Abstract] | ||
Total | 617,000 | |
2015 Underwriting year | ||
Components Of Required Capital [Abstract] | ||
Total | $ 595,100 |
Commitments and contingencies (Aquiline commitment) (Details) - USD ($) $ in Thousands |
6 Months Ended | |||
---|---|---|---|---|
Nov. 07, 2014 |
Oct. 02, 2014 |
Jun. 30, 2016 |
Dec. 31, 2015 |
|
Aquiline Capital Partners II GP Offshore Ltd | ||||
Related Party Transaction [Line Items] | ||||
Total capital commitment | $ 50,000 | |||
Remaining capital commitment | 2,934 | $ 3,413 | ||
Western World | Aquiline Capital Partners II GP Offshore Ltd | ||||
Related Party Transaction [Line Items] | ||||
Total capital commitment | $ 10,000 | |||
Remaining capital commitment | 587 | 683 | ||
Aquiline Financial Services Fund III LP | ||||
Related Party Transaction [Line Items] | ||||
Total capital commitment | $ 100,000 | |||
Remaining capital commitment | $ 70,379 | $ 86,110 |
Commitments and contingencies (Other investment commitments) (Details) - USD ($) $ in Thousands |
Dec. 30, 2015 |
Dec. 29, 2014 |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|---|---|
Fixed maturity commitment | ||||
Other Commitments [Line Items] | ||||
Remaining commitment | $ 29,726 | $ 34,888 | ||
Loan Origination Commitments [Member] | ||||
Other Commitments [Line Items] | ||||
Capital commitment | 25,000 | |||
Remaining commitment | 4,588 | |||
Investment commitment | ||||
Other Commitments [Line Items] | ||||
Capital commitment | 308,000 | 263,000 | ||
Remaining commitment | 198,265 | 185,548 | ||
Fund A | ||||
Other Commitments [Line Items] | ||||
Remaining capital commitment | 0 | 10,000 | ||
Total capital commitment | $ 20,000 | $ 20,000 | ||
Fund B | ||||
Other Commitments [Line Items] | ||||
Remaining capital commitment | $ 0 | $ 9,536 | ||
Total capital commitment | $ 25,000 |
Related party transactions (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|---|
Nov. 07, 2014
USD ($)
|
Oct. 02, 2014
USD ($)
|
Dec. 20, 2011
USD ($)
|
Jun. 30, 2016
USD ($)
shares
|
Jun. 30, 2015
USD ($)
|
Jun. 30, 2016
USD ($)
Employee
shares
|
Jun. 30, 2015
USD ($)
|
Dec. 31, 2015
USD ($)
|
Nov. 24, 2015
USD ($)
|
|
Aquiline Capital Partners LLC | |||||||||
Related Party Transaction [Line Items] | |||||||||
Shares owned by related party | shares | 828,458 | 828,458 | |||||||
Related parties number of employees | Employee | 2 | ||||||||
Group Ark Insurance Holdings Ltd | |||||||||
Related Party Transaction [Line Items] | |||||||||
Gross premiums written | $ 65 | $ 526 | $ 1,971 | $ 2,396 | |||||
Premiums receivable | 1,041 | 1,041 | 82 | ||||||
Reinsurance premiums ceded | (17) | (28) | 0 | 1 | |||||
Reinsurance balances payable | 4 | 4 | 4 | ||||||
Loss reserves recoverable | 748 | 748 | 790 | ||||||
Earned premium adjustments | 473 | 534 | $ 999 | $ 1,317 | |||||
Conning Inc | |||||||||
Related Party Transaction [Line Items] | |||||||||
Investment management fees | 120 | $ 405 | |||||||
Aquiline Capital Partners II GP Offshore Ltd | |||||||||
Related Party Transaction [Line Items] | |||||||||
Percentage of Assignor's interest assumed | 100.00% | ||||||||
Total capital commitment | $ 50,000 | ||||||||
Partnership fees incurred | 440 | 489 | 440 | 937 | |||||
Payments to Acquire Limited Partnership Interests | 0 | 3,415 | $ 575 | 8,977 | |||||
Aquiline Financial Services Fund II LP | |||||||||
Related Party Transaction [Line Items] | |||||||||
Percentage of Assignor's interest assumed | 100.00% | ||||||||
Total capital commitment | $ 10,000 | $ 50,000 | |||||||
Aquiline Financial Services Fund III LP | |||||||||
Related Party Transaction [Line Items] | |||||||||
Total capital commitment | $ 100,000 | ||||||||
Partnership fees incurred | 575 | 369 | $ 575 | 1,239 | |||||
Payments to Acquire Limited Partnership Interests | $ 15,732 | $ 0 | $ 15,732 | $ 14,138 | |||||
Western World | Aquiline Capital Partners II GP Offshore Ltd | |||||||||
Related Party Transaction [Line Items] | |||||||||
Total capital commitment | $ 10,000 | ||||||||
WRM America Indemnity Company Inc [Member] | Western World | |||||||||
Related Party Transaction [Line Items] | |||||||||
Capital commitment | $ 3,750 |
Earnings per share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Basic earnings per share | ||||
Net income available to Validus common shareholders | $ 94,963 | $ 65,790 | $ 261,773 | $ 239,201 |
Less: Dividends on outstanding warrants | 0 | (1,081) | 0 | (2,486) |
Net income allocated to Validus common shareholders | $ 94,963 | $ 64,709 | $ 261,773 | $ 236,715 |
Weighted average number of common shares outstanding | 81,950,833 | 84,003,549 | 82,386,047 | 83,627,396 |
Basic earnings per share available to common shareholders | $ 1.16 | $ 0.77 | $ 3.18 | $ 2.83 |
Earnings per diluted share | ||||
Net income available to Validus common shareholders | $ 94,963 | $ 65,790 | $ 261,773 | $ 239,201 |
Less: Dividends on outstanding warrants | 0 | 0 | 0 | 0 |
Net income allocated to Validus common shareholders | $ 94,963 | $ 65,790 | $ 261,773 | $ 239,201 |
Weighted average number of common shares outstanding | 81,950,833 | 84,003,549 | 82,386,047 | 83,627,396 |
Weighted average number of diluted common shares outstanding | 83,373,003 | 87,313,154 | 83,785,659 | 87,448,142 |
Earnings per diluted share available to common shareholders | $ 1.14 | $ 0.75 | $ 3.12 | $ 2.74 |
Other details: | ||||
Anti-dilutive securities excluded from the calculation of diluted earnings per share | 507,262 | 630,174 | 253,631 | 315,410 |
Warrants | ||||
Earnings per diluted share | ||||
Weighted average number of diluted common shares outstanding, aggregate | 0 | 2,073,231 | 0 | 2,409,149 |
Stock options | ||||
Earnings per diluted share | ||||
Weighted average number of diluted common shares outstanding, aggregate | 33,796 | 50,160 | 34,837 | 261,792 |
Unvested restricted shares | ||||
Earnings per diluted share | ||||
Weighted average number of diluted common shares outstanding, aggregate | 1,388,374 | 1,186,214 | 1,364,775 | 1,149,805 |
Segment information (Summary of results of operating and other segments) (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | |||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2016
USD ($)
|
Jun. 30, 2015
USD ($)
|
Jun. 30, 2016
USD ($)
segments
|
Jun. 30, 2015
USD ($)
|
||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||
Number of operating segments | segments | 4 | ||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||
Gross premiums written | $ 764,042 | $ 726,168 | $ 1,936,833 | $ 1,845,392 | |||||||||||||||||
Reinsurance premiums ceded | (36,229) | (55,418) | (204,064) | (246,743) | |||||||||||||||||
Net premiums written | 727,813 | 670,750 | 1,732,769 | 1,598,649 | |||||||||||||||||
Change in unearned premiums | (154,090) | (98,062) | (587,778) | (450,071) | |||||||||||||||||
Net premiums earned | 573,723 | 572,688 | 1,144,991 | 1,148,578 | |||||||||||||||||
Other insurance related income (loss) | 745 | 708 | 1,481 | 1,648 | |||||||||||||||||
Segmental revenues | 574,468 | 573,396 | 1,146,472 | 1,150,226 | |||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
Losses and loss expenses | [1] | 307,130 | 266,146 | 531,577 | 507,075 | ||||||||||||||||
Policy acquisition costs | 107,966 | 104,323 | 215,159 | 202,734 | |||||||||||||||||
General and administrative expenses | 89,688 | 84,025 | 175,896 | 168,260 | |||||||||||||||||
Share compensation expenses | 10,727 | 9,242 | 21,964 | 18,296 | |||||||||||||||||
Total underwriting deductions | 515,511 | 463,736 | 944,596 | 896,365 | |||||||||||||||||
Segmental income | 58,957 | 109,660 | 201,876 | 253,861 | |||||||||||||||||
Other items | [2] | 24,056 | (54,920) | 60,617 | (38,561) | ||||||||||||||||
Dividends on preferred shares | 0 | 0 | 0 | 0 | |||||||||||||||||
Net investment income | 39,257 | 33,611 | 68,718 | 64,640 | |||||||||||||||||
(Income) attributable to AlphaCat investors | (6,114) | 0 | (10,714) | 0 | |||||||||||||||||
Net (income) attributable to noncontrolling interest | (21,193) | (22,561) | (58,724) | (40,739) | |||||||||||||||||
Finance expenses | 14,166 | 18,682 | 29,369 | 39,649 | |||||||||||||||||
Tax (benefit) expense | 1,706 | 2,549 | (412) | 5,114 | |||||||||||||||||
Net realized gains on investments | 2,724 | 2,244 | 2,140 | 6,413 | |||||||||||||||||
Change in net unrealized gains (losses) on investments (a) | 31,428 | (34,676) | 78,872 | (1,449) | |||||||||||||||||
(Loss) income from investment affiliate | (589) | 284 | (4,702) | 3,060 | |||||||||||||||||
Foreign exchange gains (losses) | (6,286) | 2,671 | (12,531) | 6,936 | |||||||||||||||||
Net income available to Validus | 94,963 | 65,790 | 261,773 | 239,201 | |||||||||||||||||
Selected ratios: | |||||||||||||||||||||
Net income available to Validus common shareholders | 94,963 | 65,790 | 261,773 | 239,201 | |||||||||||||||||
Corporate and investment | |||||||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
General and administrative expenses | 17,872 | 17,092 | 34,055 | 32,698 | |||||||||||||||||
Share compensation expenses | 4,007 | 3,178 | 8,099 | 6,071 | |||||||||||||||||
Total underwriting deductions | 21,879 | 20,270 | 42,154 | 38,769 | |||||||||||||||||
Segmental income | (21,879) | (20,270) | (42,154) | (38,769) | |||||||||||||||||
Other items | [2] | 22,998 | (53,076) | 59,405 | (32,808) | ||||||||||||||||
Dividends on preferred shares | 0 | 0 | 0 | 0 | |||||||||||||||||
Net investment income | [3] | 36,849 | 31,854 | 64,772 | 61,290 | ||||||||||||||||
Finance expenses | [3] | 13,979 | 15,144 | 28,320 | 30,480 | ||||||||||||||||
Tax (benefit) expense | 1,706 | 2,549 | (412) | 5,114 | |||||||||||||||||
Total expenses | 37,564 | 37,963 | 70,062 | 74,363 | |||||||||||||||||
Validus share of segmental income | 37,968 | (41,492) | 82,023 | (10,287) | |||||||||||||||||
Net realized gains on investments | [3] | 2,520 | 2,104 | 1,434 | 6,284 | ||||||||||||||||
Change in net unrealized gains (losses) on investments (a) | [3] | 30,052 | (33,926) | 77,130 | 743 | ||||||||||||||||
(Loss) income from investment affiliate | (589) | 284 | (4,702) | 3,060 | |||||||||||||||||
Foreign exchange gains (losses) | [3] | (6,621) | 3,237 | (12,695) | 6,693 | ||||||||||||||||
Other income | 79 | (608) | 756 | (608) | |||||||||||||||||
Total other items | 38,683 | (35,383) | 87,313 | 2,786 | |||||||||||||||||
Operating Segments | Validus Re | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||
Gross premiums written | 285,810 | 297,420 | 977,478 | 1,009,113 | |||||||||||||||||
Reinsurance premiums ceded | (3,196) | (19,378) | (95,691) | (133,155) | |||||||||||||||||
Net premiums written | 282,614 | 278,042 | 881,787 | 875,958 | |||||||||||||||||
Change in unearned premiums | (35,492) | (13,492) | (390,834) | (358,320) | |||||||||||||||||
Net premiums earned | 247,122 | 264,550 | 490,953 | 517,638 | |||||||||||||||||
Other insurance related income (loss) | 150 | 434 | (165) | 749 | |||||||||||||||||
Segmental revenues | 247,272 | 264,984 | 490,788 | 518,387 | |||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
Losses and loss expenses | 132,139 | 123,405 | 215,007 | 236,533 | |||||||||||||||||
Policy acquisition costs | 42,564 | 43,826 | 84,823 | 85,920 | |||||||||||||||||
General and administrative expenses | 17,872 | 18,781 | 35,051 | 38,290 | |||||||||||||||||
Share compensation expenses | 2,775 | 2,396 | 5,676 | 4,974 | |||||||||||||||||
Total underwriting deductions | 195,350 | 188,408 | 340,557 | 365,717 | |||||||||||||||||
Segmental income | 51,922 | 76,576 | 150,231 | 152,670 | |||||||||||||||||
Validus share of segmental income | $ 51,922 | $ 76,576 | $ 150,231 | $ 152,670 | |||||||||||||||||
Selected ratios: | |||||||||||||||||||||
Net premiums written / Gross premiums written | 98.90% | 93.50% | 90.20% | 86.80% | |||||||||||||||||
Losses and loss expenses | 53.50% | 46.60% | 43.80% | 45.70% | |||||||||||||||||
Policy acquisition costs | 17.20% | 16.60% | 17.30% | 16.60% | |||||||||||||||||
General and administrative expenses | [4] | 8.40% | 8.00% | 8.30% | 8.40% | ||||||||||||||||
Expense ratio | 25.60% | 24.60% | 25.60% | 25.00% | |||||||||||||||||
Combined ratio | 79.10% | 71.20% | 69.40% | 70.70% | |||||||||||||||||
Operating Segments | Talbot Segment | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||
Gross premiums written | $ 296,067 | $ 293,046 | $ 562,384 | $ 563,123 | |||||||||||||||||
Reinsurance premiums ceded | (27,161) | (37,246) | (114,619) | (128,321) | |||||||||||||||||
Net premiums written | 268,906 | 255,800 | 447,765 | 434,802 | |||||||||||||||||
Change in unearned premiums | (67,357) | (50,362) | (39,424) | (6,775) | |||||||||||||||||
Net premiums earned | 201,549 | 205,438 | 408,341 | 428,027 | |||||||||||||||||
Other insurance related income (loss) | 279 | 40 | 290 | 94 | |||||||||||||||||
Segmental revenues | 201,828 | 205,478 | 408,631 | 428,121 | |||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
Losses and loss expenses | 109,310 | 95,970 | 209,411 | 174,098 | |||||||||||||||||
Policy acquisition costs | 43,613 | 47,659 | 87,956 | 96,763 | |||||||||||||||||
General and administrative expenses | 39,061 | 35,555 | 77,596 | 72,049 | |||||||||||||||||
Share compensation expenses | 3,270 | 3,024 | 6,792 | 5,981 | |||||||||||||||||
Total underwriting deductions | 195,254 | 182,208 | 381,755 | 348,891 | |||||||||||||||||
Segmental income | 6,574 | 23,270 | 26,876 | 79,230 | |||||||||||||||||
Validus share of segmental income | $ 6,574 | $ 23,270 | $ 26,876 | $ 79,230 | |||||||||||||||||
Selected ratios: | |||||||||||||||||||||
Net premiums written / Gross premiums written | 90.80% | 87.30% | 79.60% | 77.20% | |||||||||||||||||
Losses and loss expenses | 54.20% | 46.70% | 51.30% | 40.70% | |||||||||||||||||
Policy acquisition costs | 21.60% | 23.20% | 21.50% | 22.60% | |||||||||||||||||
General and administrative expenses | [4] | 21.10% | 18.80% | 20.70% | 18.20% | ||||||||||||||||
Expense ratio | 42.70% | 42.00% | 42.20% | 40.80% | |||||||||||||||||
Combined ratio | 96.90% | 88.70% | 93.50% | 81.50% | |||||||||||||||||
Operating Segments | Western World | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||
Gross premiums written | $ 86,971 | $ 79,554 | $ 150,930 | $ 136,501 | |||||||||||||||||
Reinsurance premiums ceded | (5,006) | (5,441) | (9,145) | (8,674) | |||||||||||||||||
Net premiums written | 81,965 | 74,113 | 141,785 | 127,827 | |||||||||||||||||
Change in unearned premiums | (16,309) | (8,995) | (14,630) | 5,173 | |||||||||||||||||
Net premiums earned | 65,656 | 65,118 | 127,155 | 133,000 | |||||||||||||||||
Other insurance related income (loss) | 189 | 276 | 477 | 539 | |||||||||||||||||
Segmental revenues | 65,845 | 65,394 | 127,632 | 133,539 | |||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
Losses and loss expenses | 44,229 | 46,771 | 83,875 | 97,288 | |||||||||||||||||
Policy acquisition costs | 15,410 | 9,617 | 29,610 | 13,896 | |||||||||||||||||
General and administrative expenses | 11,458 | 8,923 | 23,533 | 19,550 | |||||||||||||||||
Share compensation expenses | 542 | 494 | 1,123 | 971 | |||||||||||||||||
Total underwriting deductions | 71,639 | 65,805 | 138,141 | 131,705 | |||||||||||||||||
Segmental income | (5,794) | (411) | (10,509) | 1,834 | |||||||||||||||||
Validus share of segmental income | $ (5,794) | $ (411) | $ (10,509) | $ 1,834 | |||||||||||||||||
Selected ratios: | |||||||||||||||||||||
Net premiums written / Gross premiums written | 94.20% | 93.20% | 93.90% | 93.60% | |||||||||||||||||
Losses and loss expenses | 67.40% | 71.80% | 66.00% | 73.10% | |||||||||||||||||
Policy acquisition costs | 23.50% | 14.80% | 23.30% | 10.50% | |||||||||||||||||
General and administrative expenses | [4] | 18.20% | 14.50% | 19.30% | 15.40% | ||||||||||||||||
Expense ratio | 41.70% | 29.30% | 42.60% | 25.90% | |||||||||||||||||
Combined ratio | 109.10% | 101.10% | 108.60% | 99.00% | |||||||||||||||||
Operating Segments | AlphaCat | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||
Gross premiums written | [5] | $ 98,905 | $ 62,795 | $ 266,253 | $ 164,600 | ||||||||||||||||
Third party management fees | [5] | 3,091 | 4,323 | 7,818 | 8,860 | ||||||||||||||||
Related party management fees | [5] | 328 | 1,134 | 1,219 | 2,320 | ||||||||||||||||
Segmental revenues | [5] | 3,419 | 5,457 | 9,037 | 11,180 | ||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
General and administrative expenses | [5] | 2,751 | 2,330 | 4,233 | 4,759 | ||||||||||||||||
Share compensation expenses | [5] | 133 | 150 | 274 | 299 | ||||||||||||||||
Total underwriting deductions | [5] | 2,963 | 5,029 | 5,402 | 12,022 | ||||||||||||||||
Segmental income | [5] | 456 | 428 | 3,635 | (842) | ||||||||||||||||
Net investment income | [5],[6] | 4,421 | 7,341 | 10,028 | 16,378 | ||||||||||||||||
Finance expenses | [5] | 75 | 2,534 | 883 | 6,962 | ||||||||||||||||
Foreign exchange gains (losses) | [5] | 4 | 15 | 12 | 2 | ||||||||||||||||
Operating Segments | AlphaCat | AlphaCat sidecars | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||
Gross premiums written | [5] | (14) | 3,241 | (66) | 43,347 | ||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
Net investment income | [5],[6] | 541 | 1,273 | 665 | 2,441 | ||||||||||||||||
Operating Segments | AlphaCat | AlphaCat ILS funds - Lower Risk (a) | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||
Gross premiums written | [5],[7] | 50,234 | 45,687 | 110,192 | 88,435 | ||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
Net investment income | [5],[6],[7] | 2,075 | 1,894 | 4,582 | 3,180 | ||||||||||||||||
Operating Segments | AlphaCat | AlphaCat ILS funds - Higher Risk (a) | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||
Gross premiums written | [5],[7] | 42,010 | 13,867 | 138,330 | 32,818 | ||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
Net investment income | [5],[6],[7] | 692 | 2,376 | 3,128 | 4,801 | ||||||||||||||||
Operating Segments | AlphaCat | BetaCat ILS funds | |||||||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
Net investment income | [5],[6] | 1,113 | 60 | 1,676 | 234 | ||||||||||||||||
Operating Segments | AlphaCat | PaCRe funds | |||||||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
Net investment income | [5],[6] | 0 | 1,738 | (23) | 5,722 | ||||||||||||||||
Operating Segments | AlphaCat | AlphaCat direct | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||
Gross premiums written | [5],[8] | 6,675 | 0 | 17,797 | 0 | ||||||||||||||||
Operating Segments | AlphaCat And Consolidated Variable Interest Entities | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||
Gross premiums written | 98,905 | 62,795 | 266,253 | 164,600 | |||||||||||||||||
Reinsurance premiums ceded | (4,577) | 0 | (4,821) | (4,538) | |||||||||||||||||
Net premiums written | 94,328 | 62,795 | 261,432 | 160,062 | |||||||||||||||||
Change in unearned premiums | (34,932) | (25,213) | (142,890) | (90,149) | |||||||||||||||||
Net premiums earned | 59,396 | 37,582 | 118,542 | 69,913 | |||||||||||||||||
Other insurance related income (loss) | 3,401 | 5,532 | 9,066 | 11,456 | |||||||||||||||||
Segmental revenues | 62,797 | 43,114 | 127,608 | 81,369 | |||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
Losses and loss expenses | 21,452 | 0 | 23,284 | (844) | |||||||||||||||||
Policy acquisition costs | 6,530 | 3,742 | 12,687 | 7,177 | |||||||||||||||||
General and administrative expenses | 6,561 | 8,805 | 14,017 | 16,059 | |||||||||||||||||
Share compensation expenses | 133 | 150 | 274 | 299 | |||||||||||||||||
Total underwriting deductions | 34,676 | 12,697 | 50,262 | 22,691 | |||||||||||||||||
Segmental income | 28,121 | 30,417 | 77,346 | 58,678 | |||||||||||||||||
Other items | [2] | 1,058 | (1,844) | 1,212 | (5,753) | ||||||||||||||||
Net investment income | 3,005 | 1,757 | 4,543 | 3,350 | |||||||||||||||||
(Income) attributable to AlphaCat investors | (6,114) | 0 | (10,714) | ||||||||||||||||||
Net (income) attributable to noncontrolling interest | (21,193) | (22,561) | (58,724) | (40,739) | |||||||||||||||||
Validus share of segmental income | [5] | 4,877 | 7,769 | 13,663 | 15,536 | ||||||||||||||||
Eliminations | |||||||||||||||||||||
Underwriting revenues | |||||||||||||||||||||
Gross premiums written | (3,711) | (6,647) | (20,212) | (27,945) | |||||||||||||||||
Reinsurance premiums ceded | 3,711 | 6,647 | 20,212 | 27,945 | |||||||||||||||||
Other insurance related income (loss) | (3,274) | (5,574) | (8,187) | (11,190) | |||||||||||||||||
Segmental revenues | (3,274) | (5,574) | (8,187) | (11,190) | |||||||||||||||||
Underwriting deductions | |||||||||||||||||||||
Policy acquisition costs | (151) | (521) | 83 | (1,022) | |||||||||||||||||
General and administrative expenses | (3,136) | (5,131) | (8,356) | (10,386) | |||||||||||||||||
Total underwriting deductions | (3,287) | (5,652) | (8,273) | (11,408) | |||||||||||||||||
Segmental income | 13 | 78 | 86 | 218 | |||||||||||||||||
Net investment income | (597) | (597) | |||||||||||||||||||
Validus share of segmental income | $ (584) | $ 78 | $ (511) | $ 218 | |||||||||||||||||
|
Segment information (Gross premiums written by geographic location and segment) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | $ 764,042 | $ 726,168 | $ 1,936,833 | $ 1,845,392 | |||||||||
Percent of gross premiums written | 100.00% | 100.00% | 100.00% | 100.00% | |||||||||
United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | $ 292,114 | $ 313,968 | $ 701,830 | $ 749,678 | |||||||||
Percent of gross premiums written | 38.20% | 43.30% | 36.20% | 40.70% | |||||||||
Worldwide excluding United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | $ 53,363 | $ 44,795 | $ 134,667 | $ 119,534 | ||||||||
Percent of gross premiums written | [1] | 7.00% | 6.20% | 7.00% | 6.50% | ||||||||
Australia and New Zealand | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | $ 4,877 | $ 3,465 | $ 16,060 | $ 15,054 | |||||||||
Percent of gross premiums written | 0.60% | 0.50% | 0.80% | 0.80% | |||||||||
Europe | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | $ 10,193 | $ 27,855 | $ 49,048 | $ 66,423 | |||||||||
Percent of gross premiums written | 1.30% | 3.80% | 2.50% | 3.60% | |||||||||
Latin America and Caribbean | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | $ 31,078 | $ 32,458 | $ 65,441 | $ 60,504 | |||||||||
Percent of gross premiums written | 4.10% | 4.50% | 3.40% | 3.30% | |||||||||
Japan | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | $ 44,732 | $ 42,269 | $ 47,697 | $ 44,394 | |||||||||
Percent of gross premiums written | 5.90% | 5.80% | 2.50% | 2.40% | |||||||||
Canada | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | $ 4,478 | $ 3,142 | $ 7,195 | $ 7,143 | |||||||||
Percent of gross premiums written | 0.60% | 0.40% | 0.40% | 0.40% | |||||||||
Rest of the world | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [2] | $ 32,608 | $ 27,714 | $ 74,895 | $ 67,126 | ||||||||
Percent of gross premiums written | [2] | 4.30% | 3.80% | 3.90% | 3.60% | ||||||||
Sub-total, non United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | $ 181,329 | $ 181,698 | $ 395,003 | $ 380,178 | |||||||||
Percent of gross premiums written | 23.80% | 25.00% | 20.50% | 20.60% | |||||||||
Worldwide including United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | $ 121,773 | $ 101,060 | $ 368,543 | $ 273,954 | ||||||||
Percent of gross premiums written | [1] | 15.90% | 13.90% | 19.00% | 14.80% | ||||||||
Other location non-specific | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [3] | $ 168,826 | $ 129,442 | $ 471,457 | $ 441,582 | ||||||||
Percent of gross premiums written | [3] | 22.10% | 17.80% | 24.30% | 23.90% | ||||||||
Operating Segments | Validus Re | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | $ 285,810 | $ 297,420 | $ 977,478 | $ 1,009,113 | |||||||||
Operating Segments | Validus Re | United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 129,087 | 171,006 | 424,481 | 510,020 | |||||||||
Operating Segments | Validus Re | Worldwide excluding United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | 16,975 | 12,322 | 47,239 | 47,288 | ||||||||
Operating Segments | Validus Re | Australia and New Zealand | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 1,926 | 1,643 | 6,849 | 11,507 | |||||||||
Operating Segments | Validus Re | Europe | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 3,267 | 16,282 | 25,734 | 41,017 | |||||||||
Operating Segments | Validus Re | Latin America and Caribbean | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 5,992 | 7,684 | 19,574 | 16,932 | |||||||||
Operating Segments | Validus Re | Japan | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 39,053 | 37,800 | 39,925 | 39,184 | |||||||||
Operating Segments | Validus Re | Canada | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 1,821 | 597 | 3,497 | 2,782 | |||||||||
Operating Segments | Validus Re | Rest of the world | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [2] | 3,259 | 3,026 | 19,947 | 21,680 | ||||||||
Operating Segments | Validus Re | Sub-total, non United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 72,293 | 79,354 | 162,765 | 180,390 | |||||||||
Operating Segments | Validus Re | Worldwide including United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | 35,561 | 37,967 | 147,338 | 122,811 | ||||||||
Operating Segments | Validus Re | Other location non-specific | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [3] | 48,869 | 9,093 | 242,894 | 195,892 | ||||||||
Operating Segments | Talbot Segment | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 296,067 | 293,046 | 562,384 | 563,123 | |||||||||
Operating Segments | Talbot Segment | United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 39,135 | 40,036 | 65,245 | 68,094 | |||||||||
Operating Segments | Talbot Segment | Worldwide excluding United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | 30,028 | 30,231 | 65,532 | 65,173 | ||||||||
Operating Segments | Talbot Segment | Australia and New Zealand | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 2,063 | 1,173 | 4,375 | 3,049 | |||||||||
Operating Segments | Talbot Segment | Europe | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 6,855 | 10,584 | 20,716 | 23,798 | |||||||||
Operating Segments | Talbot Segment | Latin America and Caribbean | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 27,597 | 28,693 | 51,404 | 51,385 | |||||||||
Operating Segments | Talbot Segment | Japan | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 3,965 | 2,843 | 4,582 | 3,597 | |||||||||
Operating Segments | Talbot Segment | Canada | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 2,470 | 2,299 | 3,562 | 3,997 | |||||||||
Operating Segments | Talbot Segment | Rest of the world | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [2] | 29,806 | 24,982 | 57,290 | 47,988 | ||||||||
Operating Segments | Talbot Segment | Sub-total, non United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 102,784 | 100,805 | 207,461 | 198,987 | |||||||||
Operating Segments | Talbot Segment | Worldwide including United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | 34,198 | 32,704 | 62,652 | 54,498 | ||||||||
Operating Segments | Talbot Segment | Other location non-specific | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [3] | 119,950 | 119,501 | 227,026 | 241,544 | ||||||||
Operating Segments | Western World | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 86,971 | 79,554 | 150,930 | 136,501 | |||||||||
Operating Segments | Western World | United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 86,971 | 79,554 | 150,930 | 136,501 | |||||||||
Operating Segments | Western World | Worldwide excluding United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | 0 | 0 | 0 | 0 | ||||||||
Operating Segments | Western World | Australia and New Zealand | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 0 | 0 | 0 | 0 | |||||||||
Operating Segments | Western World | Europe | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 0 | 0 | 0 | 0 | |||||||||
Operating Segments | Western World | Latin America and Caribbean | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 0 | 0 | 0 | 0 | |||||||||
Operating Segments | Western World | Japan | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 0 | 0 | 0 | 0 | |||||||||
Operating Segments | Western World | Canada | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 0 | 0 | 0 | 0 | |||||||||
Operating Segments | Western World | Rest of the world | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [2] | 0 | 0 | 0 | 0 | ||||||||
Operating Segments | Western World | Sub-total, non United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 0 | 0 | 0 | 0 | |||||||||
Operating Segments | Western World | Worldwide including United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | 0 | 0 | 0 | 0 | ||||||||
Operating Segments | Western World | Other location non-specific | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [3] | 0 | 0 | 0 | 0 | ||||||||
Operating Segments | AlphaCat | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [4] | 98,905 | 62,795 | 266,253 | 164,600 | ||||||||
Operating Segments | AlphaCat | United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 37,338 | 23,800 | 62,729 | 36,945 | |||||||||
Operating Segments | AlphaCat | Worldwide excluding United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | 6,496 | 2,173 | 22,507 | 8,006 | ||||||||
Operating Segments | AlphaCat | Australia and New Zealand | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 867 | 624 | 4,949 | 624 | |||||||||
Operating Segments | AlphaCat | Europe | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | (145) | 1,073 | 3,306 | 2,512 | |||||||||
Operating Segments | AlphaCat | Latin America and Caribbean | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 0 | 0 | 0 | 0 | |||||||||
Operating Segments | AlphaCat | Japan | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 1,721 | 1,671 | 3,221 | 1,671 | |||||||||
Operating Segments | AlphaCat | Canada | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 223 | 294 | 223 | 488 | |||||||||
Operating Segments | AlphaCat | Rest of the world | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [2] | 0 | 0 | 0 | 0 | ||||||||
Operating Segments | AlphaCat | Sub-total, non United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 9,162 | 5,835 | 34,206 | 13,301 | |||||||||
Operating Segments | AlphaCat | Worldwide including United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | 52,394 | 32,410 | 167,767 | 110,304 | ||||||||
Operating Segments | AlphaCat | Other location non-specific | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [3] | 11 | 750 | 1,551 | 4,050 | ||||||||
Eliminations | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | (3,711) | (6,647) | (20,212) | (27,945) | |||||||||
Eliminations | United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | (417) | (428) | (1,555) | (1,882) | |||||||||
Eliminations | Worldwide excluding United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | (136) | 69 | (611) | (933) | ||||||||
Eliminations | Australia and New Zealand | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 21 | 25 | (113) | (126) | |||||||||
Eliminations | Europe | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | 216 | (84) | (708) | (904) | |||||||||
Eliminations | Latin America and Caribbean | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | (2,511) | (3,919) | (5,537) | (7,813) | |||||||||
Eliminations | Japan | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | (7) | (45) | (31) | (58) | |||||||||
Eliminations | Canada | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | (36) | (48) | (87) | (124) | |||||||||
Eliminations | Rest of the world | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [2] | (457) | (294) | (2,342) | (2,542) | ||||||||
Eliminations | Sub-total, non United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | (2,910) | (4,296) | (9,429) | (12,500) | |||||||||
Eliminations | Worldwide including United States | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [1] | (380) | (2,021) | (9,214) | (13,659) | ||||||||
Eliminations | Other location non-specific | |||||||||||||
Gross premiums written allocated to the territory of coverage exposure | |||||||||||||
Gross premiums written | [3] | $ (4) | $ 98 | $ (14) | $ 96 | ||||||||
|
Subsequent events (Details) - $ / shares |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Aug. 03, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Jun. 30, 2015 |
Mar. 31, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Subsequent Event [Line Items] | |||||||
Cash dividends declared per share | $ 0.35 | $ 0.32 | $ 0.7 | $ 0.64 | |||
Common shares | |||||||
Subsequent Event [Line Items] | |||||||
Cash dividends declared per share | $ 0.35 | $ 0.35 | $ 0.32 | $ 0.32 | |||
Subsequent Event | Common shares | |||||||
Subsequent Event [Line Items] | |||||||
Cash dividends declared per share | $ 0.35 | ||||||
Subsequent Event | Preferred Stock | |||||||
Subsequent Event [Line Items] | |||||||
Dividends on preferred stock | $ 0.3753472 |
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