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 summarizes our consolidated property casualty insurance net written premiums, earned premiums and incurred loss and loss expenses:



(Dollars in millions)	Years ended December 31,
	2018			2017			2016
Direct written premiums	$	5,018		$	4,854		$	4,646
Assumed written premiums	173			125			103
Ceded written premiums	(161		)	(139		)	(169		)
Net written premiums	$	5,030		$	4,840		$	4,580

Direct earned premiums	$	4,931		$	4,752		$	4,567
Assumed earned premiums	149			132			77
Ceded earned premiums	(160		)	(162		)	(162		)
Earned premiums	$	4,920		$	4,722		$	4,482

Direct incurred loss and loss expenses	$	3,188		$	2,961		$	2,874
Assumed incurred loss and loss expenses	125			113			43
Ceded incurred loss and loss expenses	(90		)	64			(56		)
Incurred loss and loss expenses	$	3,223		$	3,138		$	2,861

Our changes in 2017 direct incurred and ceded incurred compared to 2016 resulted primarily from a large settlement paid by USAIG, a joint underwriting association of individual insurance companies that collectively functions as a worldwide aviation insurance market. This settlement resulted in offsetting amounts to direct incurred and ceded incurred with no change to our net incurred loss and loss expense. We terminated our participation in the USAIG pool after policy year 2002.

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.

The table below summarizes our consolidated life insurance earned premiums and contract holders' benefits incurred:



(Dollars in millions)	Years ended December 31,
	2018			2017			2016
Direct earned premiums	$	320		$	300		$	290
Ceded earned premiums	(70		)	(68		)	(62		)
Earned premiums	$	250		$	232		$	228

Direct contract holders' benefits incurred	$	328		$	319		$	303
Ceded contract holders' benefits incurred	(61		)	(67		)	(57		)
Contract holders' benefits incurred	$	267		$	252		$	246

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