XML 38 R27.htm IDEA: XBRL DOCUMENT v3.21.2
Segments of Business (Tables)
 9 Months Ended
Sep. 30, 2021
Segment Reporting [Abstract]  
Results for Reportable Segments and Corporate Activities

The following tables present segment results for Alleghany’s three reportable segments and for corporate activities for the three and nine months ended September 30, 2021 and 2020:

 

 

 

Reinsurance Segment

 

 

Insurance Segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended
September 30, 2021

 

Property

 

 

Casualty &
specialty(1)

 

 

Total

 

 

RSUI

 

 

Cap
Specialty

 

 

Total

 

 

Subtotal

 

 

Alleghany
Capital

 

 

Total
Segments

 

 

Corporate Activities

 

 

Consolidated

 

 

($ in millions)

 

Gross premiums written

 

$

617.2

 

 

$

1,111.0

 

 

$

1,728.2

 

 

$

533.1

 

 

$

128.4

 

 

$

661.5

 

 

$

2,389.7

 

 

$

—

 

 

$

2,389.7

 

 

$

(11.7

)

 

$

2,378.0

 

Net premiums written

 

 

467.9

 

 

 

1,046.7

 

 

 

1,514.6

 

 

 

358.0

 

 

 

110.5

 

 

 

468.5

 

 

 

1,983.1

 

 

 

—

 

 

 

1,983.1

 

 

 

—

 

 

 

1,983.1

 

Net premiums earned

 

 

474.3

 

 

 

949.0

 

 

 

1,423.3

 

 

 

316.6

 

 

 

103.0

 

 

 

419.6

 

 

 

1,842.9

 

 

 

—

 

 

 

1,842.9

 

 

 

—

 

 

 

1,842.9

 

Net loss and LAE

 

 

611.2

 

 

 

619.6

 

 

 

1,230.8

 

 

 

219.5

 

 

 

63.6

 

 

 

283.1

 

 

 

1,513.9

 

 

 

—

 

 

 

1,513.9

 

 

 

—

 

 

 

1,513.9

 

Commissions, brokerage and
   other underwriting expenses

 

 

124.0

 

 

 

300.4

 

 

 

424.4

 

 

 

66.5

 

 

 

38.3

 

 

 

104.8

 

 

 

529.2

 

 

 

—

 

 

 

529.2

 

 

 

—

 

 

 

529.2

 

Underwriting (loss) profit(2)

 

$

(260.9

)

 

$

29.0

 

 

$

(231.9

)

 

$

30.6

 

 

$

1.1

 

 

$

31.7

 

 

 

(200.2

)

 

 

—

 

 

 

(200.2

)

 

 

—

 

 

 

(200.2

)

Net investment income

 

 

 

125.0

 

 

 

0.1

 

 

 

125.1

 

 

 

7.9

 

 

 

133.0

 

Change in the fair value of equity securities

 

 

 

(78.3

)

 

 

—

 

 

 

(78.3

)

 

 

(57.8

)

 

 

(136.1

)

Net realized capital gains

 

 

 

20.7

 

 

 

(0.5

)

 

 

20.2

 

 

 

(0.1

)

 

 

20.1

 

Change in allowance for credit losses on available for sale securities

 

 

 

0.1

 

 

 

—

 

 

 

0.1

 

 

 

—

 

 

 

0.1

 

Product and service revenues

 

 

 

10.4

 

 

 

986.4

 

 

 

996.8

 

 

 

9.8

 

 

 

1,006.6

 

Other operating expenses

 

 

 

20.8

 

 

 

869.0

 

 

 

889.8

 

 

 

1.2

 

 

 

891.0

 

Corporate administration

 

 

 

(0.1

)

 

 

—

 

 

 

(0.1

)

 

 

6.3

 

 

 

6.2

 

Amortization of intangible assets

 

 

 

0.9

 

 

 

11.7

 

 

 

12.6

 

 

 

—

 

 

 

12.6

 

Interest expense

 

 

 

6.7

 

 

 

3.9

 

 

 

10.6

 

 

 

15.1

 

 

 

25.7

 

(Losses) earnings before income taxes

 

 

$

(150.6

)

 

$

101.4

 

 

$

(49.2

)

 

$

(62.8

)

 

$

(112.0

)

 

 

 

Reinsurance Segment

 

 

Insurance Segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended
September 30, 2020

 

Property

 

 

Casualty &
specialty(1)

 

 

Total

 

 

RSUI

 

 

Cap
Specialty

 

 

Total

 

 

Subtotal

 

 

Alleghany
Capital

 

 

Total
Segments

 

 

Corporate Activities

 

 

Consolidated

 

 

($ in millions)

 

Gross premiums written

 

$

473.3

 

 

$

904.7

 

 

$

1,378.0

 

 

$

410.8

 

 

$

111.8

 

 

$

522.6

 

 

$

1,900.6

 

 

$

—

 

 

$

1,900.6

 

 

$

(9.2

)

 

$

1,891.4

 

Net premiums written

 

 

375.9

 

 

 

887.3

 

 

 

1,263.2

 

 

 

271.9

 

 

 

102.0

 

 

 

373.9

 

 

 

1,637.1

 

 

 

—

 

 

 

1,637.1

 

 

 

—

 

 

 

1,637.1

 

Net premiums earned

 

 

374.7

 

 

 

832.6

 

 

 

1,207.3

 

 

 

260.4

 

 

 

89.2

 

 

 

349.6

 

 

 

1,556.9

 

 

 

—

 

 

 

1,556.9

 

 

 

—

 

 

 

1,556.9

 

Net loss and LAE

 

 

306.1

 

 

 

553.2

 

 

 

859.3

 

 

 

256.6

 

 

 

57.8

 

 

 

314.4

 

 

 

1,173.7

 

 

 

—

 

 

 

1,173.7

 

 

 

—

 

 

 

1,173.7

 

Commissions, brokerage and
   other underwriting expenses

 

 

112.4

 

 

 

259.0

 

 

 

371.4

 

 

 

58.8

 

 

 

34.3

 

 

 

93.1

 

 

 

464.5

 

 

 

—

 

 

 

464.5

 

 

 

—

 

 

 

464.5

 

Underwriting (loss) profit(2)

 

$

(43.8

)

 

$

20.4

 

 

$

(23.4

)

 

$

(55.0

)

 

$

(2.9

)

 

$

(57.9

)

 

 

(81.3

)

 

 

—

 

 

 

(81.3

)

 

 

—

 

 

 

(81.3

)

Net investment income

 

 

 

122.7

 

 

 

—

 

 

 

122.7

 

 

 

6.6

 

 

 

129.3

 

Change in the fair value of equity securities

 

 

 

103.4

 

 

 

—

 

 

 

103.4

 

 

 

(10.6

)

 

 

92.8

 

Net realized capital gains

 

 

 

1.7

 

 

 

13.9

 

 

 

15.6

 

 

 

1.1

 

 

 

16.7

 

Change in allowance for credit losses on available for sale securities

 

 

 

3.4

 

 

 

—

 

 

 

3.4

 

 

 

—

 

 

 

3.4

 

Product and service revenues

 

 

 

8.9

 

 

 

713.8

 

 

 

722.7

 

 

 

1.1

 

 

 

723.8

 

Other operating expenses

 

 

 

23.4

 

 

 

643.4

 

 

 

666.8

 

 

 

2.6

 

 

 

669.4

 

Corporate administration

 

 

 

0.8

 

 

 

—

 

 

 

0.8

 

 

 

12.1

 

 

 

12.9

 

Amortization of intangible assets

 

 

 

0.2

 

 

 

11.0

 

 

 

11.2

 

 

 

—

 

 

 

11.2

 

Interest expense

 

 

 

6.8

 

 

 

3.3

 

 

 

10.1

 

 

 

13.2

 

 

 

23.3

 

Earnings (losses) before income taxes

 

 

$

127.6

 

 

$

70.0

 

 

$

197.6

 

 

$

(29.7

)

 

$

167.9

 

 

 

 

Reinsurance Segment

 

 

Insurance Segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended
September 30, 2021

 

Property

 

 

Casualty &
specialty(1)

 

 

Total

 

 

RSUI

 

 

Cap
Specialty

 

 

Total

 

 

Subtotal

 

 

Alleghany
Capital

 

 

Total
Segments

 

 

Corporate Activities

 

 

Consolidated

 

 

($ in millions)

 

Gross premiums written

 

$

1,687.9

 

 

$

3,125.0

 

 

$

4,812.9

 

 

$

1,511.5

 

 

$

354.1

 

 

$

1,865.6

 

 

$

6,678.5

 

 

$

—

 

 

$

6,678.5

 

 

$

(30.2

)

 

$

6,648.3

 

Net premiums written

 

 

1,346.8

 

 

 

2,971.8

 

 

 

4,318.6

 

 

 

994.2

 

 

 

303.3

 

 

 

1,297.5

 

 

 

5,616.1

 

 

 

—

 

 

 

5,616.1

 

 

 

—

 

 

 

5,616.1

 

Net premiums earned

 

 

1,284.5

 

 

 

2,761.8

 

 

 

4,046.3

 

 

 

896.5

 

 

 

289.2

 

 

 

1,185.7

 

 

 

5,232.0

 

 

 

—

 

 

 

5,232.0

 

 

 

—

 

 

 

5,232.0

 

Net loss and LAE

 

 

1,208.4

 

 

 

1,715.1

 

 

 

2,923.5

 

 

 

614.5

 

 

 

175.2

 

 

 

789.7

 

 

 

3,713.2

 

 

 

—

 

 

 

3,713.2

 

 

 

—

 

 

 

3,713.2

 

Commissions, brokerage and
   other underwriting expenses

 

 

356.9

 

 

 

868.7

 

 

 

1,225.6

 

 

 

191.3

 

 

 

111.9

 

 

 

303.2

 

 

 

1,528.8

 

 

 

—

 

 

 

1,528.8

 

 

 

—

 

 

 

1,528.8

 

Underwriting (loss) profit(2)

 

$

(280.8

)

 

$

178.0

 

 

$

(102.8

)

 

$

90.7

 

 

$

2.1

 

 

$

92.8

 

 

 

(10.0

)

 

 

—

 

 

 

(10.0

)

 

 

—

 

 

 

(10.0

)

Net investment income

 

 

 

384.7

 

 

 

0.1

 

 

 

384.8

 

 

 

28.6

 

 

 

413.4

 

Change in the fair value of equity securities

 

 

 

176.6

 

 

 

—

 

 

 

176.6

 

 

 

4.0

 

 

 

180.6

 

Net realized capital gains

 

 

 

44.0

 

 

 

0.7

 

 

 

44.7

 

 

 

1.3

 

 

 

46.0

 

Change in allowance for credit losses on available for sale securities

 

 

 

2.2

 

 

 

—

 

 

 

2.2

 

 

 

0.1

 

 

 

2.3

 

Product and service revenues

 

 

 

30.1

 

 

 

2,534.7

 

 

 

2,564.8

 

 

 

10.0

 

 

 

2,574.8

 

Other operating expenses

 

 

 

50.4

 

 

 

2,302.4

 

 

 

2,352.8

 

 

 

1.7

 

 

 

2,354.5

 

Corporate administration

 

 

 

(0.5

)

 

 

—

 

 

 

(0.5

)

 

 

36.4

 

 

 

35.9

 

Amortization of intangible assets

 

 

 

1.8

 

 

 

34.7

 

 

 

36.5

 

 

 

—

 

 

 

36.5

 

Interest expense

 

 

 

20.2

 

 

 

11.3

 

 

 

31.5

 

 

 

41.9

 

 

 

73.4

 

Earnings (losses) before income taxes

 

 

$

555.7

 

 

$

187.1

 

 

$

742.8

 

 

$

(36.0

)

 

$

706.8

 

 

 

 

 

Reinsurance Segment

 

 

Insurance Segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended
September 30, 2020

 

Property

 

 

Casualty &
specialty(1)

 

 

Total

 

 

RSUI

 

 

Cap
Specialty

 

 

Total

 

 

Subtotal

 

 

Alleghany
Capital

 

 

Total
Segments

 

 

Corporate
Activities

 

 

Consolidated

 

 

($ in millions)

 

Gross premiums written

 

$

1,299.2

 

 

$

2,560.2

 

 

$

3,859.4

 

 

$

1,251.3

 

 

$

298.5

 

 

$

1,549.8

 

 

$

5,409.2

 

 

$

—

 

 

$

5,409.2

 

 

$

(26.1

)

 

$

5,383.1

 

Net premiums written

 

 

1,044.6

 

 

 

2,516.1

 

 

 

3,560.7

 

 

 

816.4

 

 

 

271.7

 

 

 

1,088.1

 

 

 

4,648.8

 

 

 

—

 

 

 

4,648.8

 

 

 

—

 

 

 

4,648.8

 

Net premiums earned

 

 

1,024.8

 

 

 

2,386.5

 

 

 

3,411.3

 

 

 

731.3

 

 

 

253.5

 

 

 

984.8

 

 

 

4,396.1

 

 

 

—

 

 

 

4,396.1

 

 

 

—

 

 

 

4,396.1

 

Net loss and LAE

 

 

827.4

 

 

 

1,672.4

 

 

 

2,499.8

 

 

 

568.5

 

 

 

157.2

 

 

 

725.7

 

 

 

3,225.5

 

 

 

—

 

 

 

3,225.5

 

 

 

—

 

 

 

3,225.5

 

Commissions, brokerage and
   other underwriting expenses

 

 

314.6

 

 

 

729.6

 

 

 

1,044.2

 

 

 

169.4

 

 

 

102.3

 

 

 

271.7

 

 

 

1,315.9

 

 

 

—

 

 

 

1,315.9

 

 

 

—

 

 

 

1,315.9

 

Underwriting loss(2)

 

$

(117.2

)

 

$

(15.5

)

 

$

(132.7

)

 

$

(6.6

)

 

$

(6.0

)

 

$

(12.6

)

 

 

(145.3

)

 

 

—

 

 

 

(145.3

)

 

 

—

 

 

 

(145.3

)

Net investment income

 

 

 

347.8

 

 

 

1.8

 

 

 

349.6

 

 

 

10.3

 

 

 

359.9

 

Change in the fair value of equity securities

 

 

 

(176.0

)

 

 

—

 

 

 

(176.0

)

 

 

(12.0

)

 

 

(188.0

)

Net realized capital gains

 

 

 

36.8

 

 

 

35.3

 

 

 

72.1

 

 

 

(80.4

)

 

 

(8.3

)

Change in allowance for credit losses on available for sale securities

 

 

 

(10.7

)

 

 

—

 

 

 

(10.7

)

 

 

(0.2

)

 

 

(10.9

)

Product and service revenues

 

 

 

24.4

 

 

 

1,654.3

 

 

 

1,678.7

 

 

 

5.7

 

 

 

1,684.4

 

Other operating expenses

 

 

 

66.5

 

 

 

1,567.7

 

 

 

1,634.2

 

 

 

12.2

 

 

 

1,646.4

 

Corporate administration

 

 

 

(0.9

)

 

 

—

 

 

 

(0.9

)

 

 

18.0

 

 

 

17.1

 

Amortization of intangible assets

 

 

 

0.6

 

 

 

32.3

 

 

 

32.9

 

 

 

—

 

 

 

32.9

 

Interest expense

 

 

 

20.3

 

 

 

11.4

 

 

 

31.7

 

 

 

32.2

 

 

 

63.9

 

(Losses) earnings before income taxes

 

 

$

(9.5

)

 

$

80.0

 

 

$

70.5

 

 

$

(139.0

)

 

$

(68.5

)

 

 

(1)
Primarily consists of the following reinsurance lines of business: directors’ and officers’ liability; errors and omissions liability; general liability; medical malpractice; ocean marine and aviation; auto liability; accident and health; mortgage reinsurance; surety; and credit.
(2)
Underwriting profit represents net premiums earned less net loss and LAE and commissions, brokerage and other underwriting expenses, all as determined in accordance with GAAP, and does not include net investment income, change in the fair value of equity securities, net realized capital gains, change in allowance for credit losses on available for sale securities, product and service revenues, other operating expenses, corporate administration, amortization of intangible assets or interest expense. Underwriting profit does not replace earnings before income taxes determined in accordance with GAAP as a measure of profitability. Rather, Alleghany believes that underwriting profit enhances the understanding of its reinsurance and insurance segments’ operating results by highlighting net earnings attributable to their underwriting performance. Earnings before income taxes (a GAAP measure) may show a profit despite an underlying underwriting loss. Where underwriting losses persist over extended periods, a reinsurance or an insurance company’s ability to continue as an ongoing concern may be at risk. Therefore, Alleghany views underwriting profit as an important measure in the overall evaluation of performance.
Summary of Identifiable Assets and Equity

The following table presents identifiable assets, the portion of identifiable assets related to cash and invested assets and equity attributable to Alleghany for Alleghany’s reportable segments and for corporate activities as of September 30, 2021:

 

 

 

Identifiable
Assets

 

 

Invested Assets
and Cash

 

 

Equity
Attributable to
Alleghany

 

 

 

($ in millions)

 

Reinsurance segment

 

$

19,488.3

 

 

$

15,013.5

 

 

$

5,227.0

 

Insurance segment

 

 

8,067.4

 

 

 

5,887.2

 

 

 

2,630.8

 

Subtotal

 

 

27,555.7

 

 

 

20,900.7

 

 

 

7,857.8

 

Alleghany Capital

 

 

2,817.4

 

 

 

137.3

 

 

 

1,187.9

 

Total segments

 

 

30,373.1

 

 

 

21,038.0

 

 

 

9,045.7

 

Corporate activities

 

 

1,496.1

 

 

 

1,461.6

 

 

 

(186.2

)

Consolidated

 

$

31,869.2

 

 

$

22,499.6

 

 

$

8,859.5

 
Summary of Alleghany Capital Product and Service Revenues

For Alleghany Capital’s industrial and non-industrial operations, product and service revenues (formerly noninsurance revenue) consists of the sale of manufactured goods and services. The following table presents product and service revenues for the Alleghany Capital segment for the three and nine months ended September 30, 2021 and 2020:

 

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

($ in millions)

 

Industrial(1)

 

$

427.2

 

 

$

324.2

 

 

$

1,238.8

 

 

$

847.3

 

Non-Industrial(2)

 

 

559.2

 

 

 

389.6

 

 

 

1,295.9

 

 

 

806.9

 

Corporate & other

 

 

—

 

 

 

—

 

 

 

—

 

 

 

0.1

 

Alleghany Capital

 

$

986.4

 

 

$

713.8

 

 

$

2,534.7

 

 

$

1,654.3

 

 

(1)
For the three and nine months ended September 30, 2021 and 2020, the vast majority of industrial product and service revenues were recognized as goods and services transferred to customers over time.
(2)
For the three and nine months ended September 30, 2021, approximately 43 percent and 52 percent, respectively, of non-industrial product and service revenues were recognized as services transferred to customers over time, with the remainder recognized as goods transferred at a point in time. For the three and nine months ended September 30, 2020, approximately 54 percent and 66 percent, respectively, of non-industrial product and service revenues were recognized as services transferred to customers over time, with the remainder recognized as goods transferred in a point in time.