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)	Three months ended March 31,
	2017			2016
Direct written premiums	$	1,226		$	1,161
Assumed written premiums	33			21
Ceded written premiums	(28		)	(35		)
Net written premiums	$	1,231		$	1,147

Our condensed consolidated statements of income include earned consolidated property casualty insurance premiums on assumed and ceded business:



(Dollars in millions)	Three months ended March 31,
	2017			2016
Direct earned premiums	$	1,163		$	1,119
Assumed earned premiums	27			15
Ceded earned premiums	(39		)	(38		)
Earned premiums	$	1,151		$	1,096

Our condensed consolidated statements of income include incurred consolidated property casualty insurance loss and loss expenses on assumed and ceded business:



(Dollars in millions)	Three months ended March 31,
	2017			2016
Direct incurred loss and loss expenses	$	788		$	648
Assumed incurred loss and loss expenses	15			10
Ceded incurred loss and loss expenses	(15		)	3
Incurred loss and loss expenses	$	788		$	661

Our change in ceded incurred compared to prior years resulted from an increase in current accident year losses.

Our life insurance company purchases reinsurance for protection of a portion of the 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 condensed consolidated statements of income include earned life insurance premiums on ceded business:



(Dollars in millions)	Three months ended March 31,
	2017			2016
Direct earned premiums	$	74		$	71
Ceded earned premiums	(17		)	(13		)
Earned premiums	$	57		$	58

Our condensed consolidated statements of income include life insurance contract holders' benefits incurred on ceded business:



(Dollars in millions)	Three months ended March 31,
	2017			2016
Direct contract holders' benefits incurred	$	76		$	76
Ceded contract holders' benefits incurred	(11		)	(13		)
Contract holders' benefits incurred	$	65		$	63

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