Reinsurance

12 Months Ended

Dec. 31, 2020

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,
	2020		2019		2018
Direct written premiums	$	5,756	$	5,477	$	5,018
Assumed written premiums	335		244		173
Ceded written premiums	(227)		(205)		(161)
Net written premiums	$	5,864	$	5,516	$	5,030

Direct earned premiums	$	5,623	$	5,340	$	4,931
Assumed earned premiums	285		199		149
Ceded earned premiums	(217)		(205)		(160)
Earned premiums	$	5,691	$	5,334	$	4,920

Direct incurred loss and loss expenses	$	3,699	$	3,402	$	3,188
Assumed incurred loss and loss expenses	184		117		125
Ceded incurred loss and loss expenses	(46)		(167)		(90)
Incurred loss and loss expenses	$	3,837	$	3,352	$	3,223

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,
	2020		2019		2018
Direct earned premiums	$	362	$	341	$	320
Ceded earned premiums	(73)		(71)		(70)
Earned premiums	$	289	$	270	$	250

Direct contract holders' benefits incurred	$	359	$	359	$	328
Ceded contract holders' benefits incurred	(62)		(73)		(61)
Contract holders' benefits incurred	$	297	$	286	$	267

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