Segment Information (Tables)

6 Months Ended

Jun. 30, 2014

Segment Reporting [Abstract]

Schedule of segment reporting, by segment

Six Months Ended June 30, 2013 (U.S. dollars in thousands, except ratios)	Insurance			Reinsurance			Total P&C			Corporate and Other (1)			Total
Gross premiums written	$	2,970,175		$	1,378,911		$	4,349,086		$	154,272		$	4,503,358
Net premiums written	2,238,351			1,263,830			3,502,181			139,341			3,641,522
Net premiums earned	2,097,634			855,109			2,952,743			139,341			3,092,084
Net losses and loss expenses	1,371,840			408,850			1,780,690			227,720			2,008,410
Acquisition costs	268,654			172,133			440,787			11,358			452,145
Operating expenses (2)	378,511			80,043			458,554			4,801			463,355
Underwriting profit (loss)	$	78,629		$	194,083		$	272,712		$	(104,538	)	$	168,174
Net investment income - excluding Life Funds Withheld Assets							300,857			142,280			443,137
Net investment income - Life Funds Withheld Assets										—			—
Net results from structured products (3)	7,717			3,512			11,229			—			11,229
Net fee income and other (4)	(3,294		)	1,152			(2,142		)	1,087			(1,055		)
Loss on sale of life reinsurance subsidiary							—			—			—
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets							74,947			2,530			77,477
Net realized gains (losses) on investments - Life Funds Withheld Assets							—			—			—
Net realized and unrealized gains (losses) on derivative instruments							—			2,780			2,780
Net realized and unrealized gains (losses) on life retrocession embedded derivative							—			—			—
Net income (loss) from investment fund affiliates and operating affiliates (5)							—			142,587			142,587
Exchange (gains) losses							—			(44,766		)	(44,766		)
Corporate operating expenses							—			102,077			102,077
Contribution from P&C and Corporate and Other							$	657,603		$	129,415		$	787,018
Interest expense (6)										52,257			52,257
Non-controlling interests										38,922			38,922
Income tax expense										72,351			72,351
Net income (loss) attributable to ordinary shareholders													$	623,488
Ratios – P&C operations: (7)
Loss and loss expense ratio	65.4		%	47.8		%	60.3		%
Underwriting expense ratio	30.9		%	29.5		%	30.5		%
Combined ratio	96.3		%	77.3		%	90.8		%

____________

(1) Corporate and Other includes the Company's run-off life operations.

(2) Operating expenses exclude Corporate operating expenses, shown separately.

(3) The net results from structured products include net investment income and interest expense of $35.9 million and $24.6 million, respectively.

(4) Net fee income and other includes operating expenses from the Company's loss prevention consulting services business.

(5) The Company records the income related to the alternative funds and to the private investment and operating fund affiliates on a one-month and three-month lag, respectively.

(6) Interest expense excludes interest expense related to deposit liabilities recorded in the Insurance and Reinsurance segments.

(7) Ratios are based on net premiums earned from P&C operations.

The following tables summarize the segment results for the three and six months ended June 30, 2014 and 2013:

Three Months Ended June 30, 2014 (U.S. dollars in thousands, except ratios)	Insurance			Reinsurance			Total P&C			Corporate and Other (1)			Total
Gross premiums written	$	1,618,405		$	493,124		$	2,111,529		$	86,710		$	2,198,239
Net premiums written	996,880			436,446			1,433,326			58,518			1,491,844
Net premiums earned	1,003,990			434,086			1,438,076			58,518			1,496,594
Net losses and loss expenses	627,627			200,253			827,880			85,299			913,179
Acquisition costs	99,863			80,874			180,737			3,882			184,619
Operating expenses (2)	213,931			47,582			261,513			2,209			263,722
Underwriting profit (loss)	$	62,569		$	105,377		$	167,946		$	(32,872	)	$	135,074
Net investment income - excluding Life Funds Withheld Assets							144,555			52,118			196,673
Net investment income - Life Funds Withheld Assets										19,165			19,165
Net results from structured products (3)	31,645			3,240			34,885			—			34,885
Net fee income and other (4)	(3,567		)	664			(2,903		)	45			(2,858		)
Loss on sale of life reinsurance subsidiary							—			666,423			666,423
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets							78,505			2,339			80,844
Net realized gains (losses) on investments - Life Funds Withheld Assets							—			(8,147		)	(8,147		)
Net realized and unrealized gains (losses) on derivative instruments							—			11,599			11,599
Net realized and unrealized gains (losses) on life retrocession embedded derivative							—			(17,546		)	(17,546		)
Net income (loss) from investment fund affiliates and operating affiliates (5)							—			45,421			45,421
Exchange (gains) losses							—			21,141			21,141
Corporate operating expenses							—			56,495			56,495
Contribution from P&C and Corporate and Other							422,988			(671,937		)	(248,949		)
Interest expense (6)										32,284			32,284
Non-controlling interests										3,682			3,682
Income tax expense										(5,654		)	(5,654		)
Net income (loss) attributable to ordinary shareholders													$	(279,261	)
Ratios – P&C operations: (7)
Loss and loss expense ratio	62.5		%	46.1		%	57.6		%
Underwriting expense ratio	31.3		%	29.6		%	30.7		%
Combined ratio	93.8		%	75.7		%	88.3		%

____________

(1) Corporate and Other includes the Company's run-off life operations.

(2) Operating expenses exclude Corporate operating expenses, shown separately.

(3) The net results from structured products include net investment income and interest expense (credit) of $16.9 million and $(18.2) million, respectively. Net results from structured products includes a benefit of $28.7 million from a negotiated termination of one of the Company's larger structured indemnity contracts during the second quarter of 2014, producing a net interest expense credit.

(4) Net fee income and other includes operating expenses from the Company's loss prevention consulting services business.

(5) The Company records the income related to the alternative funds and to the private investment and operating fund affiliates on a one-month and three-month lag, respectively.

(6) Interest expense excludes interest expense related to deposit liabilities recorded in the Insurance and Reinsurance segments.

(7) Ratios are based on net premiums earned from P&C operations.

Three Months Ended June 30, 2013 (U.S. dollars in thousands, except ratios)	Insurance			Reinsurance			Total P&C			Corporate and Other (1)			Total
Gross premiums written	$	1,472,388		$	471,782		$	1,944,170		$	81,302		$	2,025,472
Net premiums written	1,049,163			410,809			1,459,972			73,896			1,533,868
Net premiums earned	1,058,542			429,955			1,488,497			73,896			1,562,393
Net losses and loss expenses	721,323			216,283			937,606			116,767			1,054,373
Acquisition costs	138,032			86,599			224,631			7,255			231,886
Operating expenses (2)	194,514			39,622			234,136			2,206			236,342
Underwriting profit (loss)	$	4,673		$	87,451		$	92,124		$	(52,332	)	$	39,792
Net investment income - excluding Life Funds Withheld Assets							143,818			70,592			214,410
Net investment income - Life Funds Withheld Assets										—			—
Net results from structured products (3)	3,532			2,521			6,053			—			6,053
Net fee income and other (4)	(1,355		)	520			(835		)	44			(791		)
Loss on sale of life reinsurance subsidiary							—			—			—
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets							29,369			11,599			40,968
Net realized gains (losses) on investments - Life Funds Withheld Assets							—			—			—
Net realized and unrealized gains (losses) on derivative instruments							—			(5,105		)	(5,105		)
Net realized and unrealized gains (losses) on life retrocession embedded derivative							—			—			—
Net income (loss) from investment fund affiliates and operating affiliates (5)							—			79,368			79,368
Exchange (gains) losses							—			(11,331		)	(11,331		)
Corporate operating expenses							—			55,155			55,155
Contribution from P&C and Corporate and Other							270,529			60,342			330,871
Interest expense (6)										26,121			26,121
Non-controlling interests										3,180			3,180
Income tax expense										28,872			28,872
Net income (loss) attributable to ordinary shareholders													$	272,698
Ratios – P&C operations: (7)
Loss and loss expense ratio	68.1		%	50.3		%	63.0		%
Underwriting expense ratio	31.5		%	29.4		%	30.8		%
Combined ratio	99.6		%	79.7		%	93.8		%

____________

(1) Corporate and Other includes the Company's run-off life operations.

(2) Operating expenses exclude Corporate operating expenses, shown separately.

(3) The net results from structured products include net investment income and interest expense of $18.1 million and $12.1 million, respectively.

(4) Net fee income and other includes operating expenses from the Company's loss prevention consulting services business.

(5) The Company records the income related to the alternative funds and to the private investment and operating fund affiliates on a one-month and three-month lag, respectively.

(6) Interest expense excludes interest expense related to deposit liabilities recorded in the Insurance and Reinsurance segments.

(7) Ratios are based on net premiums earned from P&C operations.

Six Months Ended June 30, 2014 (U.S. dollars in thousands, except ratios)	Insurance			Reinsurance			Total P&C			Corporate and Other (1)			Total
Gross premiums written	$	3,189,331		$	1,350,837		$	4,540,168		$	171,007		$	4,711,175
Net premiums written	2,124,247			1,228,619			3,352,866			134,829			3,487,695
Net premiums earned	1,996,430			854,174			2,850,604			134,829			2,985,433
Net losses and loss expenses	1,266,820			392,565			1,659,385			198,886			1,858,271
Acquisition costs	204,863			168,109			372,972			11,061			384,033
Operating expenses (2)	416,984			88,443			505,427			5,397			510,824
Underwriting profit (loss)	$	107,763		$	205,057		$	312,820		$	(80,515	)	$	232,305
Net investment income - excluding Life Funds Withheld Assets							288,082			123,010			411,092
Net investment income - Life Funds Withheld Assets										19,165			19,165
Net results from structured products (3)	36,535			6,303			42,838			—			42,838
Net fee income and other (4)	(4,779		)	1,337			(3,442		)	90			(3,352		)
Loss on sale of life reinsurance subsidiary							—			666,423			666,423
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets							96,171			3,902			100,073
Net realized gains (losses) on investments - Life Funds Withheld Assets							—			(8,147		)	(8,147		)
Net realized and unrealized gains (losses) on derivative instruments							—			13,409			13,409
Net realized and unrealized gains (losses) on life retrocession embedded derivative							—			(17,546		)	(17,546		)
Net income (loss) from investment fund affiliates and operating affiliates (5)							—			125,009			125,009
Exchange (gains) losses							—			31,582			31,582
Corporate operating expenses							—			107,833			107,833
Contribution from P&C and Corporate and Other							$	736,469		$	(627,461	)	$	109,008
Interest expense (6)										64,444			64,444
Non-controlling interests										39,441			39,441
Income tax expense										28,667			28,667
Net income (loss) attributable to ordinary shareholders													$	(23,544	)
Ratios – P&C operations: (7)
Loss and loss expense ratio	63.5		%	46.0		%	58.2		%
Underwriting expense ratio	31.1		%	30.0		%	30.8		%
Combined ratio	94.6		%	76.0		%	89.0		%

____________

(1) Corporate and Other includes the Company's run-off life operations.

(2) Operating expenses exclude Corporate operating expenses, shown separately.

(3) The net results from structured products include net investment income and net interest expense (credit) of $35.7 million and $(7.4) million, respectively. Net results from structured products includes a benefit of $28.7 million from a negotiated termination of one of the Company's larger structured indemnity contracts during the second quarter of 2014, producing a net interest expense credit.

(4) Net fee income and other includes operating expenses from the Company's loss prevention consulting services business.

(5) The Company records the income related to the alternative funds and to the private investment and operating fund affiliates on a one-month and three-month lag, respectively.

(6) Interest expense excludes interest expense related to deposit liabilities recorded in the Insurance and Reinsurance se

Schedule of net premiums earned by line of business

The following tables summarize the Company’s net premiums earned by line of business for the three months ended June 30, 2014 and 2013:

Three Months Ended June 30, 2014 (U.S. dollars in thousands)	Insurance		Reinsurance		Corporate and Other		Total
P&C Operations:
Professional	$	267,509	$	44,239	$	—	$	311,748
Casualty	358,990		82,929		—		441,919
Property catastrophe	—		112,562		—		112,562
Property	142,874		142,337		—		285,211
Marine, energy, aviation and satellite	—		21,065		—		21,065
Specialty	179,948		—		—		179,948
Other (1)	54,669		30,954		—		85,623
Total P&C Operations	$	1,003,990	$	434,086	$	—	$	1,438,076
Corporate and Other:
Run-off Life operations - Annuity	$	—	$	—	$	21,565	$	21,565
Run-off Life operations - Other Life	—		—		36,953		36,953
Total Corporate and Other	$	—	$	—	$	58,518	$	58,518
Total	$	1,003,990	$	434,086	$	58,518	$	1,496,594
Three Months Ended June 30, 2013 (U.S. dollars in thousands)	Insurance		Reinsurance		Corporate and Other		Total
P&C Operations:
Professional	$	349,812	$	50,978	$	—	$	400,790
Casualty	338,437		76,544		—		414,981
Property catastrophe	—		129,361		—		129,361
Property	135,089		132,501		—		267,590
Marine, energy, aviation and satellite	—		24,588		—		24,588
Specialty	181,131		—		—		181,131
Other (1)	54,073		15,983		—		70,056
Total P&C Operations	$	1,058,542	$	429,955	$	—	$	1,488,497
Corporate and Other:
Run-off Life operations - Annuity	$	—	$	—	$	30,087	$	30,087
Run-off Life operations - Other Life	—		—		43,809		43,809
Total Corporate and Other	$	—	$	—	$	73,896	$	73,896
Total	$	1,058,542	$	429,955	$	73,896	$	1,562,393

____________

(1) Other within the Insurance segment includes: excess and surplus, programs, surety, structured indemnity and certain other discontinued lines. Other within the Reinsurance segment includes: whole account contracts, accident and health and other lines.

The following tables summarize the Company’s net premiums earned by line of business for the six months ended June 30, 2014:

Six Months Ended June 30, 2014 (U.S. dollars in thousands)	Insurance		Reinsurance		Corporate and Other		Total
P&C Operations:
Professional	$	542,936	$	94,343	$	—	$	637,279
Casualty	702,994		159,650		—		862,644
Property catastrophe	—		220,999		—		220,999
Property	282,607		277,576		—		560,183
Marine, energy, aviation and satellite	—		44,579		—		44,579
Specialty	356,857		—		—		356,857
Other (1)	111,036		57,027		—		168,063
Total P&C Operations	$	1,996,430	$	854,174	$	—	$	2,850,604
Corporate and Other:
Run-off Life operations - Annuity	$	—	$	—	$	53,362	$	53,362
Run-off Life operations - Other Life	—		—		81,467		81,467
Total Corporate and Other	$	—	$	—	$	134,829	$	134,829
Total	$	1,996,430	$	854,174	$	134,829	$	2,985,433
Six Months Ended June 30, 2013 (U.S. dollars in thousands)	Insurance		Reinsurance		Corporate and Other		Total
P&C Operations:
Professional	$	700,650	$	96,414	$	—	$	797,064
Casualty	665,855		153,525		—		819,380
Property catastrophe	—		243,003		—		243,003
Property	259,539		273,770		—		533,309
Marine, energy, aviation and satellite	—		52,428		—		52,428
Specialty	364,096		—		—		364,096
Other (1)	107,494		35,969		—		143,463
Total P&C Operations	$	2,097,634	$	855,109	$	—	$	2,952,743
Corporate and Other:
Run-off Life operations - Annuity	$	—	$	—	$	59,771	$	59,771
Run-off Life operations - Other Life	—		—		79,570		79,570
Total Corporate and Other	$	—	$	—	$	139,341	$	139,341
Total	$	2,097,634	$	855,109	$	139,341	$	3,092,084

____________

(1) Other within the Insurance segment includes: excess and surplus, programs, surety, structured indemnity and certain other discontinued lines. Other within the Reinsurance segment includes: whole account contracts, accident and health and other lines.