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Reinsurance
 12 Months Ended
Dec. 31, 2016
Reinsurance Disclosures [Abstract]  
Reinsurance
Reinsurance
Primary components of our property casualty reinsurance assumed operations include involuntary and voluntary assumed as well as contracts from our reinsurance assumed operations, known as Cincinnati Re. Primary components of our ceded reinsurance include a property per risk treaty, property excess treaty, casualty per occurrence treaty, casualty excess treaty, property catastrophe treaty and catastrophe bonds and retrocessions on our reinsurance assumed operations. Management’s decisions about the appropriate level of risk retention are affected by various factors, including changes in our underwriting practices, capacity to retain risks and reinsurance market conditions.
 
The table below includes our net written consolidated property casualty insurance premiums on assumed and ceded business:
(Dollars in millions)
 
Years ended December 31,
 
 
2016
 
2015
 
2014
Direct written premiums
 
$
4,646

 
$
4,461

 
$
4,309

Assumed written premiums
 
103

 
77

 
11

Ceded written premiums
 
(169
)
 
(177
)
 
(177
)
Net written premiums
 
$
4,580

 
$
4,361

 
$
4,143

 
 
 
 
 
 
 


Our consolidated statements of income include earned consolidated property casualty insurance premiums on
assumed and ceded business:
(Dollars in millions)
 
Years ended December 31,
 
 
2016
 
2015
 
2014
Direct earned premiums
 
$
4,567

 
$
4,396

 
$
4,209

Assumed earned premiums
 
77

 
29

 
12

Ceded earned premiums
 
(162
)
 
(154
)
 
(176
)
Earned premiums
 
$
4,482

 
$
4,271

 
$
4,045

 
 
 
 
 
 
 


Our consolidated statements of income include incurred consolidated property casualty insurance loss and loss expenses on assumed and ceded business:
(Dollars in millions)
 
Years ended December 31,
 
 
2016
 
2015
 
2014
Direct incurred loss and loss expenses
 
$
2,874

 
$
2,596

 
$
2,661

Assumed incurred loss and loss expenses
 
43

 
12

 
6

Ceded incurred loss and loss expenses
 
(56
)
 
(36
)
 
(40
)
Incurred loss and loss expenses
 
$
2,861

 
$
2,572

 
$
2,627

 
 
 
 
 
 
 


Our change in ceded incurred compared to prior years resulted primarily from increased retrocessions of Cincinnati Re.

Our life insurance company purchases reinsurance for protection of a portion of risks that are written. Primary components of our life reinsurance program include individual mortality coverage, aggregate catastrophe and accidental death coverage in excess of certain deductibles.
 
Our consolidated statements of income include earned life insurance premiums on ceded business:
(Dollars in millions)
 
Years ended December 31,
 
 
2016
 
2015
 
2014
Direct earned premiums
 
$
290

 
$
271

 
$
259

Ceded earned premiums
 
(62
)
 
(62
)
 
(61
)
Earned premiums
 
$
228

 
$
209

 
$
198

 
 
 
 
 
 
 

 
Our consolidated statements of income include life insurance contract holders' benefits incurred on ceded business:
(Dollars in millions)
 
Years ended December 31,
 
 
2016
 
2015
 
2014
Direct contract holders' benefits incurred
 
$
303

 
$
292

 
$
299

Ceded contract holders' benefits incurred
 
(57
)
 
(56
)
 
(70
)
Contract holders' benefits incurred
 
$
246

 
$
236

 
$
229

 
 
 
 
 
 
 


The ceded benefits incurred can vary depending on the type of life insurance policy held and the year the policy was issued.