Loss and loss adjustment expense reserves

9 Months Ended

Sep. 30, 2013

Loss and Loss Adjustment Expense Reserves [Abstract]

Loss and loss adjustment expense reserves

Loss and loss adjustment expense reserves

As of September 30, 2013 and December 31, 2012, loss and loss adjustment expense reserves in the consolidated balance sheet was comprised of the following:

	September 30, 2013		December 31, 2012
	($ in thousands)
Case loss and loss adjustment expense reserves	$	59,383	$	3,668
Incurred but not reported loss and loss adjustment expense reserves	84,324		63,603
	$	143,707	$	67,271

The following table represents the activity in the reserve for losses and loss adjustment expenses for the nine months ended September 30, 2013 and for the year ended December 31, 2012:

	September 30, 2013			December 31, 2012
	($ in thousands)
Gross reserves for loss and loss adjustment expenses, beginning of period	$	67,271		$	—
Less: loss and loss adjustment expenses recoverable, beginning of period	—			—
Net reserves for loss and loss adjustment expenses, beginning of period	67,271			—
Increase (decrease) in net loss and loss adjustment expenses incurred in respect of losses occurring in:
Current year	107,279			80,306
Prior years'	(3,600		)	—
Total incurred loss and loss adjustment expenses	103,679			80,306
Net loss and loss adjustment expenses paid in respect of losses occurring in:
Current year	(14,951		)	(13,035		)
Prior years'	(18,576		)	—
Total net paid losses	(33,527		)	(13,035		)
Net reserve for loss and loss adjustment expenses, end of period	137,423			67,271
Plus: loss and loss adjustment expenses recoverable, end of period	6,284			—
Gross reserve for loss and loss adjustment expenses, end of period	$	143,707		$	67,271

The $3.6 million decrease in prior years’ reserves recorded in the nine months ended September 30, 2013 related primarily to a crop contract, which was accompanied by an equal decrease in the premium written and earned for that contract, resulting in a minimal impact to underwriting income.