10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended June 30, 2015
	OR
¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to ______

Commission file number 1-10804

XL GROUP

Public Limited Company

(Exact name of registrant as specified in its charter)

Ireland	98-0665416
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

XL House, 8 St. Stephen's Green, Dublin 2, Ireland

(Address of principal executive offices and zip code)

+353 (1) 400-5500

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of "large accelerated filer" "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

As of August 5, 2015, there were 302,314,373 outstanding Ordinary Shares, $0.01 par value per share, of the registrant.

XL GROUP PLC

INDEX TO FORM 10-Q

		Page No.
	PART I—FINANCIAL INFORMATION
Item 1.	Financial Statements:
	Unaudited Consolidated Balance Sheets at June 30, 2015 and December 31, 2014	1
	Unaudited Consolidated Statements of Income for the Three and Six Months Ended June 30, 2015 and 2014	2
	Unaudited Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2015 and 2014	3
	Unaudited Consolidated Statements of Shareholders’ Equity for the Six Months Ended June 30, 2015 and 2014	4
	Unaudited Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2015 and 2014	5
	Notes to Unaudited Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	50
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	102
Item 4.	Controls and Procedures	110
	PART II—OTHER INFORMATION
Item 1.	Legal Proceedings	110
Item 1A.	Risk Factors	110
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	111
Item 6.	Exhibits	112
	Signatures	113

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

XL GROUP PLC

UNAUDITED CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands, except share data)	June 30, 2015		December 31, 2014
ASSETS
Investments:
Fixed maturities, at fair value (amortized cost: 2015, $32,699,709; 2014, $27,728,771)	$	33,767,991	$	29,359,034
Equity securities, at fair value (cost: 2015, $964,038; 2014, $763,833)	1,073,470		868,292
Short-term investments, at fair value (amortized cost: 2015, $806,990; 2014, $257,221)	807,486		256,727
Total investments available for sale	$	35,648,947	$	30,484,053
Fixed maturities, at fair value (amortized cost: 2015, $768,492; 2014, $1,180)	$	748,931	$	1,171
Short-term investments, at fair value (amortized cost: 2015, $42,557; 2014, nil)	42,553		—
Total investments trading	$	791,484	$	1,171
Investments in affiliates	1,663,852		1,637,620
Other investments	1,743,259		1,248,439
Total investments	$	39,847,542	$	33,371,283
Cash and cash equivalents	2,840,841		2,521,814
Restricted cash	135,638		—
Accrued investment income	312,856		315,964
Deferred acquisition costs and value of business acquired	1,121,362		354,533
Ceded unearned premiums	2,433,462		952,525
Premiums receivable	5,933,368		2,473,736
Reinsurance balances receivable	371,807		131,519
Unpaid losses and loss expenses recoverable	5,155,612		3,429,368
Receivable from investments sold	118,415		92,762
Goodwill and other intangible assets	2,205,911		447,952
Deferred tax asset	204,155		204,491
Other assets	1,069,737		750,872
Total assets	$	61,750,706	$	45,046,819
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Unpaid losses and loss expenses	$	25,840,381	$	19,353,243
Deposit liabilities	1,212,206		1,245,367
Future policy benefit reserves	4,494,886		4,707,199
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable: 2015, $4,054,705; 2014, $4,265,678)	915,116		1,155,016
Unearned premiums	8,548,841		3,973,132
Notes payable and debt	2,726,455		1,662,580
Reinsurance balances payable	2,494,201		493,230
Payable for investments purchased	149,249		42,291
Deferred tax liability	144,044		66,246
Other liabilities	1,020,222		912,749
Total liabilities	$	47,545,601	$	33,611,053
Commitments and Contingencies
Shareholders’ Equity:
Ordinary shares, 999,990,000 authorized, par value $0.01; issued and outstanding (2015, 303,891,887; 2014, 255,182,955)	$	3,039	$	2,552
Additional paid in capital	9,153,868		7,359,102
Accumulated other comprehensive income	1,076,174		1,484,458
Retained earnings	2,014,217		1,187,639
Shareholders’ equity attributable to XL Group plc	$	12,247,298	$	10,033,751
Non-controlling interest in equity of consolidated subsidiaries	1,957,807		1,402,015
Total shareholders’ equity	$	14,205,105	$	11,435,766
Total liabilities and shareholders’ equity	$	61,750,706	$	45,046,819

See accompanying Notes to Unaudited Consolidated Financial Statements

1

XL GROUP PLC

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

	Three Months Ended						Six Months Ended
	June 30,						June 30,
(U.S. dollars in thousands, except per share data)	2015			2014			2015			2014
Revenues:
Net premiums earned	$	2,082,053		$	1,496,594		$	3,416,053		$	2,985,433
Net investment income:
Net investment income - excluding Life Funds Withheld Assets	176,340			213,608			334,434			446,797
Net investment income - Life Funds Withheld Assets	46,864			19,165			97,283			19,165
Total net investment income	$	223,204		$	232,773		$	431,717		$	465,962
Net realized gains (losses) on investments, and net unrealized gains (losses) on investments trading securities ("Trading") - Life Funds Withheld Assets:
Net realized gains (losses) on investments sold - excluding Life Funds Withheld Assets	20,939			105,460			36,117			128,416
Other-than-temporary impairments ("OTTI") on investments - excluding Life Funds Withheld Assets	(16,520		)	(24,362		)	(27,035		)	(26,638		)
OTTI on investments transferred to (from) other comprehensive income - excluding Life Funds Withheld Assets	(68		)	(254		)	(129		)	(1,705		)
Net realized gains (losses) on investments sold - Life Funds Withheld Assets	68,037			624			120,775			624
OTTI on investments - Life Funds Withheld Assets	(2,878		)	(8,771		)	(8,087		)	(8,771		)
Net unrealized gains (losses) on investments Trading - Life Funds Withheld Assets	(19,543		)	—			(18,783		)	—
Total net realized gains (losses) on investments, and net unrealized gains (losses) on investments Trading - Life Funds Withheld Assets	$	49,967		$	72,697		$	102,858		$	91,926
Net realized and unrealized gains (losses) on derivative instruments	48,509			11,599			65,030			13,409
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	239,174			(17,546		)	9,807			(17,546		)
Income (loss) from investment fund affiliates	31,377			17,683			66,706			50,986
Fee income and other	11,012			9,706			15,740			21,160
Total revenues	$	2,685,296		$	1,823,506		$	4,107,911		$	3,611,330
Expenses:
Net losses and loss expenses incurred	$	1,151,195		$	827,880		$	1,921,022		$	1,659,385
Claims and policy benefits	22,081			85,299			41,468			198,886
Acquisition costs	341,617			184,619			495,313			384,033
Operating expenses	507,354			333,029			833,010			643,453
Foreign exchange (gains) losses	10,374			21,141			37,764			31,582
Loss on sale of life reinsurance subsidiary	—			666,423			—			666,423
Interest expense	49,667			14,085			101,105			57,026
Total expenses	$	2,082,288		$	2,132,476		$	3,429,682		$	3,640,788
Income (loss) before income tax and income (loss) from operating affiliates	$	603,008		$	(308,970	)	$	678,229		$	(29,458	)
Income (loss) from operating affiliates	9,462			27,738			32,130			74,023
Gain on sale of operating affiliate	340,407			—			340,407			—
Provision (benefit) for income tax	32,959			(5,654		)	57,177			28,667
Net income (loss)	$	919,918		$	(275,578	)	$	993,589		$	15,898
Non-controlling interests	4,879			3,682			42,269			39,441
Net income (loss) attributable to ordinary shareholders	$	915,039		$	(279,260	)	$	951,320		$	(23,543	)
Weighted average ordinary shares and ordinary share equivalents outstanding, in thousands – basic	289,420			270,924			272,665			273,616
Weighted average ordinary shares and ordinary share equivalents outstanding, in thousands – diluted	293,983			270,924			277,473			273,616
Earnings (loss) per ordinary share and ordinary share equivalent – basic	$	3.16		$	(1.03	)	$	3.49		$	(0.09	)
Earnings (loss) per ordinary share and ordinary share equivalent – diluted	$	3.11		$	(1.03	)	$	3.43		$	(0.09	)

See accompanying Notes to Unaudited Consolidated Financial Statements

2

XL GROUP PLC

UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

	Three Months Ended						Six Months Ended
	June 30,						June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Net income (loss) attributable to ordinary shareholders	$	915,039		$	(279,260	)	$	951,320		$	(23,543	)
Change in net unrealized gains (losses) on investments - excluding Life Funds Withheld Assets, net of tax	(318,935		)	260,690			(258,590		)	502,080
Unrealized gains on held to maturity investment portfolio at time of transfer to available for sale, net of tax	—			424,861			—			424,861
Change in adjustments related to future policy benefit reserves, net of tax	26,328			(440,461		)	86,684			(474,465		)
Change in net unrealized gains (losses) on investments - Life Funds Withheld Assets, net of tax	(321,046		)	12,297			(283,931		)	12,297
Change in net unrealized gains (losses) on affiliate and other investments, net of tax	18,822			10,850			34,687			13,973
Change in OTTI losses recognized in other comprehensive income, net of tax	1,575			1,636			11,433			4,932
Change in underfunded pension liability, net of tax	(1,329		)	(8		)	(354		)	(39		)
Change in value of cash flow hedge	12			110			107			220
Foreign currency translation adjustments, net of tax	(34,423		)	(9,602		)	1,680			(13,482		)
Comprehensive income (loss)	$	286,043		$	(18,887	)	$	543,036		$	446,834

See accompanying Notes to Unaudited Consolidated Financial Statements

3

XL GROUP PLC

UNAUDITED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

	Six Months Ended
	June 30,
(U.S. dollars in thousands)	2015			2014
Ordinary Shares:
Balance - beginning of year	$	2,552		$	2,783
Issuance of ordinary shares	515			11
Buybacks of ordinary shares	(30		)	(113		)
Exercise of stock options	2			2
Balance - end of period	$	3,039		$	2,683
Additional Paid in Capital:
Balance - beginning of year	$	7,359,102		$	7,994,100
Issuance of ordinary shares	1,851,705			14
Buybacks of ordinary shares	(85,796		)	(323,455		)
Exercise of stock options	4,826			3,055
Share-based compensation	24,031			26,663
Balance - end of period	$	9,153,868		$	7,700,377
Accumulated Other Comprehensive Income (Loss):
Balance - beginning of year	$	1,484,458		$	736,657
Change in net unrealized gains (losses) on investments - excluding Life Funds Withheld Assets, net of tax	(258,590		)	502,080
Unrealized gains on held to maturity investment portfolio at time of transfer to available for sale, net of tax	—			424,861
Change in adjustments related to future policy benefit reserves, net of tax	86,684			(474,465		)
Change in net unrealized gains (losses) on investments - Life Funds Withheld Assets, net of tax	(283,931		)	12,297
Change in net unrealized gains (losses) on affiliate and other investments, net of tax	34,687			13,973
Change in OTTI losses recognized in other comprehensive income, net of tax	11,433			4,932
Change in underfunded pension liability, net of tax	(354		)	(39		)
Change in value of cash flow hedge	107			220
Foreign currency translation adjustments, net of tax	1,680			(13,482		)
Balance - end of period	$	1,076,174		$	1,207,034
Retained Earnings (Deficit):
Balance - beginning of year	$	1,187,639		$	1,264,093
Net income (loss) attributable to ordinary shareholders	951,320			(23,543		)
Dividends on ordinary shares	(91,133		)	(88,270		)
Buybacks of ordinary shares	(26,559		)	(28,085		)
Share-based compensation	(7,050		)	—
Balance - end of period	$	2,014,217		$	1,124,195
Non-controlling Interest in Equity of Consolidated Subsidiaries:
Balance - beginning of year	$	1,402,015		$	1,351,665
Non-controlling interests - contributions	4,659			21,494
Non-controlling interests - distributions	(15,026		)	—
Non-controlling interests - acquired	562,285			—
Non-controlling interests	3,874			1,129
Balance - end of period	$	1,957,807		$	1,374,288
Total Shareholders’ Equity	$	14,205,105		$	11,408,577

See accompanying Notes to Unaudited Consolidated Financial Statements

4

XL GROUP PLC

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Six Months Ended
	June 30,
(U.S. dollars in thousands)	2015			2014
Cash flows provided by (used in) operating activities:
Net income (loss)	$	993,589		$	15,898
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Total net realized (gains) losses on investments and net unrealized (gains) losses on investments, Trading - Life Funds Withheld Assets	(102,858		)	(91,926		)
Net realized and unrealized (gains) losses on derivative instruments	(65,030		)	(13,409		)
Net realized and unrealized (gains) losses on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	(9,807		)	17,546
Amortization of premiums (discounts) on fixed maturities	77,334			76,846
(Income) loss from investment and operating affiliates	(78,257		)	(68,292		)
Loss on sale of life reinsurance subsidiary	—			666,423
Gain on sale of ARX Holding Corp.	(340,407		)	—
Share-based compensation	39,641			40,563
Depreciation	29,349			29,107
Accretion of deposit liabilities	20,887			(7,762		)
Changes in:
Unpaid losses and loss expenses	(166,007		)	(264,804		)
Future policy benefit reserves	(122,842		)	(93,202		)
Funds withheld on life retrocession arrangements, net	(156,411		)	(52,104		)
Unearned premiums	868,244			848,937
Premiums receivable	(959,771		)	(792,588		)
Unpaid losses and loss expenses recoverable	(255,432		)	136,758
Ceded unearned premiums	(343,391		)	(338,855		)
Reinsurance balances receivable	56,825			(28,270		)
Deferred acquisition costs and value of business acquired	(105,402		)	216,453
Reinsurance balances payable	565,221			420,902
Deferred tax asset - net	30,284			(51,571		)
Derivatives	109,745			(45,306		)
Other assets	(63,360		)	(15,478		)
Other liabilities	(59,258		)	(286,737		)
Other	57,618			34,500
Total adjustments	$	(973,085	)	$	337,731
Net cash provided by (used in) operating activities	$	20,504		$	353,629
Cash flows provided by (used in) investing activities:
Proceeds from sale of fixed maturities and short-term investments	$	6,352,126		$	3,043,659
Proceeds from redemption of fixed maturities and short-term investments	1,938,622			1,837,319
Proceeds from sale of equity securities	271,367			295,448
Purchases of fixed maturities and short-term investments	(8,042,196		)	(3,801,109		)
Purchases of equity securities	(239,535		)	(239,680		)
Proceeds from sale of affiliates	86,156			156,481
Purchases of affiliates	(33,298		)	(196,487		)
Purchase of Catlin Group Limited, net of cash acquired	(1,020,015		)	—
Proceeds from sale of life reinsurance subsidiary	—			570,000
Proceeds from sale of ARX Holding Corp.	560,552			—
Change in restricted cash	(135,638		)	—
Other, net	(87,516		)	(96,222		)
Net cash provided by (used in) investing activities	$	(349,375	)	$	1,569,409
Cash flows provided by (used in) financing activities:
Proceeds from issuance of ordinary shares and exercise of stock options	$	4,827		$	3,057
Buybacks of ordinary shares	(112,385		)	(351,654		)
Dividends paid on ordinary shares	(89,053		)	(87,056		)
Distributions to non-controlling interests	(53,456		)	(38,502		)
Contributions from non-controlling interests	4,658			21,494
Proceeds from the issuance of debt	980,600			—
Deposit liabilities	(49,388		)	(213,869		)
Net cash provided by (used in) financing activities	$	685,803		$	(666,530	)
Effects of exchange rate changes on foreign currency cash	(37,905		)	13,799
Increase (decrease) in cash and cash equivalents	$	319,027		$	1,270,307
Cash and cash equivalents - beginning of period	2,521,814			1,800,832
Cash and cash equivalents - end of period	$	2,840,841		$	3,071,139

See accompanying Notes to Unaudited Consolidated Financial Statements

5

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Preparation and Consolidation

Unless the context otherwise indicates, references herein to the "Company" include XL Group plc, an Irish public limited company ("XL-Ireland"), and its consolidated subsidiaries. On May 1, 2015, the Company completed its acquisition of Catlin Group Limited and its consolidated subsidiaries ("Catlin"). Catlin, through its wholly-owned subsidiaries, provided property, casualty and specialty insurance and reinsurance coverage on a worldwide basis. The Company's consolidated results of operations include those of Catlin from May 1, 2015. See Note 3(a), "Acquisition and Disposals - Catlin Acquisition" for additional information with respect to the acquisition of Catlin.

These unaudited consolidated financial statements include the accounts of the Company and have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and disclosures required by GAAP for complete financial statements. In addition, the year-end balance sheet data was derived from audited financial statements but do not include all disclosures required by GAAP. In the opinion of management, these unaudited financial statements reflect all adjustments considered necessary for a fair statement of financial position and results of operations at the end of and for the periods presented. The results of operations for any interim period are not necessarily indicative of the results for a full year. All inter-company accounts and transactions have been eliminated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure about contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from these estimates. For further information, see Item 8, Note 2(a), "Significant Accounting Policies – Basis of Preparation and Consolidation," to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

To facilitate period-to-period comparisons, certain reclassifications have been made to prior period consolidated financial statement amounts to conform to current period presentation.

2. Significant Accounting Policies

(a) Restricted Cash

Restricted cash represents cash and cash equivalents that the Company is a) holding for the benefit of a third party and which is legally or contractually restricted as to withdrawal or usage for general corporate purposes; and b) not replaceable by another type of asset other than cash or cash equivalents, under the terms of the Company's contractual arrangements with such third parties. Restricted cash includes cash and cash equivalents held pursuant to the terms of the Company's contractual obligations of the transaction described in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary."

(b) Recent Accounting Pronouncements

In February 2015, the Financial Accounting Standards Board ("FASB") issued an accounting standards update concerning consolidation of certain legal entities. Under this new guidance, all legal entities are required to evaluate whether they should consolidate certain legal entities. The guidance: (1) modifies the evaluation of whether limited partnerships and similar legal entities are variable interest entities ("VIEs") or voting interest entities; (2) eliminates the presumption that a general partner should consolidate a limited partnership; (3) affects the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships; and (4) provides a scope exception from consolidation guidance for certain reporting entities. Upon adoption of the new guidance, differing requirements for performing a consolidation analysis under existing GAAP will be eliminated, and all reporting entities will now fall within the scope of the Accounting Standards Codification Subtopic 810-10, Consolidation-Overall, unless a specific exception applies. Under this Subtopic, there are only two primary models for determining whether consolidation is appropriate - a voting interest entity model, and a variable interest entity model. The guidance is effective for public business entities for annual periods beginning after December 15, 2015, and interim and annual periods thereafter, with early adoption permitted. The Company is currently evaluating the impact of this guidance.

In April 2015, the FASB issued an accounting standards update concerning the presentation of deferred debt issuance costs in an entity's balance sheet. Under this new guidance, which is part of the FASB's initiative to reduce complexity in accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements, it is required that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. In addition, the guidance also requires that the amortization of such costs be reported as interest expense. The guidance is effective for public business entities for annual periods beginning after December 15, 2015, and interim and annual periods thereafter, with early adoption permitted for

6

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

financial statements that have not been previously issued. This guidance is not expected to have a material impact on the Company's financial condition, results of operations or cash flows.

In May 2015, the FASB issued an accounting standards update concerning investments for which management estimates fair value using net asset value per share (or its equivalent) as a practical expedient. Under the guidance, such investments will no longer be reported within the fair value hierarchy. Removing those investments from the fair value hierarchy not only eliminates the diversity in practice resulting from the way in which investments measured at net asset value per share (or its equivalent) with future redemption dates are classified, but also ensures that all investments categorized in the fair value hierarchy are classified using a consistent approach. Investments that calculate net asset value per share (or its equivalent), but for which the practical expedient is not applied, will continue to be included in the fair value hierarchy. A reporting entity should continue to disclose information on investments for which fair value is measured at net asset value (or its equivalent) as a practical expedient to help users understand the nature and risks of the investments and whether the investments, if sold, are probable of being sold at amounts different from net asset value. The guidance is effective for public business entities for annual periods beginning after December 15, 2015 and interim and annual periods thereafter, with early adoption permitted. The Company is currently evaluating the impact of this guidance, but it is not expected to have a material impact on the Company's financial condition, results of operations or cash flows.

In May 2015, the FASB issued an accounting standards update concerning the annual disclosure regarding the liability for unpaid claims and claims adjustment expenses for insurance entities. The guidance requires: (1) incurred and paid claims development information by accident year, on a net basis after reinsurance, for the number of years for which claims incurred typically remain outstanding, including the most recent reporting period, which need not exceed 10 years; (2) a reconciliation of incurred and paid claims development information to the aggregate carrying amount of the liability for unpaid claims and claim adjustment expenses, with separate disclosure of reinsurance recoverable on unpaid claims for each period presented in the statement of financial position; (3) for each accident year for which incurred claims development information is presented, the total of incurred but not reported ("IBNR") liabilities plus expected development on reported claims included in the liability for unpaid claims and claims adjustment expenses, accompanied by a description of reserving methodologies; (4) for each accident year for which incurred claims development information is presented, quantitative information about claim frequency (unless it is impracticable to do so) accompanied by a qualitative description of methodologies used for determining claim frequency information; and (5) for all claims, the average annual percentage payout of incurred claims by age for the same number of accident years as the disclosure for IBNR. The guidance recommends that insurance entities aggregate or disaggregate those disclosures so that useful information is not obscured by either the inclusion of a large amount of insignificant detail or the aggregation of items that have significantly different characteristics. The amendments also require insurance entities to disclose information about significant changes in methodologies and assumptions used to calculate the liability for unpaid claims and claim adjustment expenses, including reasons for the change and the effects on the financial statements. Additionally, the amendments require insurance entities to disclose for annual and interim reporting periods a rollforward of the liability for unpaid claims and claims adjustment expenses. Additional disclosures about liabilities for unpaid claims and claim adjustment expenses reported at present value include: (1) for each period presented in the statement of financial position, the aggregate amount of discount for the time value of money deducted to derive the liability for unpaid claims and claim adjustment expenses; (2) for each period presented in the statement of income, the amount of interest accretion recognized; and (3) the line items in the statement of income in which interest accretion is classified. The guidance is effective for public business entities for annual periods beginning after December 15, 2015 and interim periods within annual periods after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact of this guidance, but it is not expected to have a material impact on the Company's financial condition, results of operations or cash flows

3. Acquisition and Disposals

(a)    Catlin Acquisition

Overview

On May 1, 2015 (the "Acquisition Date"), the Company completed its acquisition (the "Catlin Acquisition") of the entire issued share capital of Catlin as contemplated by that certain Implementation Agreement, dated January 9, 2015 (the "Implementation Agreement"), by and among XL-Ireland, Green Holdings Limited, a wholly-owned subsidiary of the Company ("Green Holdings"), and Catlin.

Pursuant to the terms of the Implementation Agreement, the Catlin Acquisition was implemented by way of a scheme of arrangement (the "Scheme") under Section 99 of the Companies Act 1981 of Bermuda, as amended (the "Companies Act"), and sanctioned by the Supreme Court of Bermuda (the "Court"), immediately after which Catlin was merged with Green Holdings under Section 104H of the Companies Act, with Green Holdings as the surviving company, pursuant to the terms of that certain Merger Agreement, dated January 9, 2015 (the "Merger Agreement"), among XL-Ireland, Green Holdings and Catlin.

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XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Pursuant to the terms of the Implementation Agreement, XL-Ireland acquired each ordinary share of Catlin, par value $0.01 per share ("Catlin Shares"), for consideration per Catlin Share (the "Acquisition Consideration") equal to 388 pence in cash and 0.130 of an XL-Ireland ordinary share, par value $0.01 per share ("XL Shares"), subject to the mix and match facility set forth in the Implementation Agreement. The newly-issued XL Shares are listed on the New York Stock Exchange. The XL Shares issued in connection with the Catlin Acquisition were issued in reliance upon the exemption from registration under the U.S. Securities Act of 1933, as amended (the "Securities Act") provided by Section 3(a)(10) of the Securities Act.

XL-Ireland issued approximately 49.9 million XL Shares and paid approximately £1.49 billion in cash to the holders of Catlin Shares as Acquisition Consideration pursuant to the terms of the Scheme.

The foregoing description of the Implementation Agreement and the Merger Agreement is qualified in its entirety by reference to the full text of the Implementation Agreement and Merger Agreement, copies of which were filed on Form 8-K on January 9, 2015.

In connection with the Catlin Acquisition, on January 9, 2015, the Company announced that it was relying on £1.6 billion of debt to be provided under a bridge facility entered into by XLIT Ltd., a wholly-owned subsidiary of the Company ("XL-Cayman"), and arranged by Morgan Stanley Senior Funding, Inc. and Goldman Sachs Bank USA (the "Bridge Facility") for the purposes of discharging the cash component of the Acquisition Consideration. The Company subsequently terminated the commitments under the Bridge Facility as of April 8, 2015, due to a sufficient amount in escrow to discharge the cash portion of the Acquisition Consideration. Costs related to maintaining the Bridge Facility are discussed in "Transaction-related Costs" below.

In addition, on January 9, 2015, the Company entered into deal contingent deliverable foreign exchange forwards ("FX Forwards") with Morgan Stanley Capital Services LLC and Goldman Sachs International. The purpose of the FX Forwards was to mitigate risk of foreign currency exposure related to the Catlin Acquisition. Following the closing of the Catlin Acquisition, the FX Forwards were settled.

Acquisition Consideration

The calculation of the consideration transferred to acquire Catlin Shares is as follows:

(In thousands, except per share data)
Catlin Shares outstanding as of April 30, 2015 that received share consideration (including the dilutive effect of warrants)	384,118
Exchange ratio per the implementation agreement	0.130
XL Share issuance to Catlin shareholders	49,935
Closing price per XL share on April 30, 2015 (1)	$	37.08
XL Share issuance consideration	$	1,851,601
Catlin Shares outstanding as of April 30, 2015 that received cash consideration (including the dilutive effect of warrants)	384,118
Cash price component, per Catlin Share in GBP	£	3.88
Cash consideration, in GBP	£	1,490,377
Foreign exchange rate: GBP/USD on April 30, 2015	$	1.5349
Cash consideration	$	2,287,579
Total acquisition consideration	$	4,139,180

____________

(1) The closing market price of XL Shares on the Acquisition Date represents the fair value of XL shares issued as part of the Acquisition Consideration.

The Company financed the $2.29 billion cash portion of the Acquisition Consideration by issuing $1.0 billion of subordinated debt, the proceeds (net of debt issuance costs) of which were $980.6 million, and the remaining $1.31 billion by using cash and cash equivalents on hand. See Note 10, "Notes Payable and Debt and Financing Arrangements," for further information on the debt issuance.

Fair Value of Net Assets Acquired and Liabilities Assumed

The purchase price was allocated to the acquired assets and assumed liabilities of Catlin based on estimated fair values on the Acquisition Date. The Company recognized goodwill of $778.0 million which is primarily attributable to the synergies and economies of scale expected to result upon integration of Catlin into the Company's operations, including further diversification in geographic mix and product offerings and an increase in distribution strength. Due to the timing of the Catlin Acquisition, the Company has not completed the assignment of goodwill to reporting units for the reporting period ending June 30, 2015. The Company estimates that none of the goodwill that was recorded will be deductible for income tax purposes. The Company also

8

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

recognized indefinite lived intangible assets of $673.0 million and other intangible assets of $315.0 million, which will be amortized over their estimated useful lives. See Note 8, "Goodwill and Other Intangible Assets," for further information.

The foregoing allocation of the purchase price is based on information that was available to management at the time the consolidated financial statements were prepared. The allocation may change as additional information becomes available within the measurement period, which cannot exceed 12 months from the Acquisition Date. The fair value recorded for these items may be subject to adjustments, which may impact the individual amounts recorded for assets acquired and liabilities assumed, as well as the residual goodwill.

The following table summarizes the fair values of the assets acquired and liabilities assumed at the Acquisition Date:

(U.S. dollars in thousands)
ASSETS
Fixed maturities, at fair value	$	6,266,489
Short-term investments, at fair value	634,599
Equity investments, at fair value	236,230
Investment in affiliates	216,843
Other investments	386,828
Total investments	$	7,740,989
Cash and cash equivalents (1)	1,267,565
Accrued investment income	35,063
Premiums receivable	2,545,188
Unpaid losses and loss expenses recoverable	1,493,267
Reinsurance balances receivable	299,579
Ceded unearned premiums	1,143,852
Deferred acquisition costs and value of business acquired	679,259
Intangible assets	988,000
Receivable from investments sold	9,633
Other assets	314,168
Total assets	$	16,516,563
LIABILITIES
Unpaid losses and loss expenses	$	6,933,144
Unearned premiums	3,742,234
Reinsurance balances payable	1,441,749
Notes payable and debt	82,066
Payable for investments purchased	34,149
Deferred tax liability	94,071
Other liabilities	265,728
Total liabilities	$	12,593,141
Net assets acquired before non-controlling interest	$	3,923,422
Non-controlling interest in equity of consolidated subsidiaries	562,285
Net assets acquired	$	3,361,137
Acquisition Consideration	$	4,139,180
Goodwill	$	778,043

____________

(1)    Includes Restricted Cash

An explanation of the significant adjustments to the components of fair value are as follows:

• Deferred acquisition costs and value of business acquired - The adjustment consists of two components. The first adjustment is the elimination of Catlin's deferred acquisition costs asset. The second adjustment is the establishment of the value of business acquired asset which represents the present value of the expected underwriting profit within the unearned premiums liability, net of reinsurance, less costs to service the related policies and a risk premium. This adjustment will be amortized to underwriting, acquisition and insurance expenses over approximately two years, as the contracts for business in-force as of the Acquisition Date expire. The Company has included $183.3 million in

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XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

acquisition expenses related to the amortization of the value of business acquired during the three and six months ended June 30, 2015.

• Intangible assets - Establish the estimated fair value of intangible assets related to Catlin. See Note 8, "Goodwill and Other Intangible Assets" for further information.

• Other assets - Establish the estimated fair value of Catlin's internally developed software.

• Unpaid losses and loss adjustment expenses - Unpaid losses and loss adjustment expenses acquired include an increase to adjust the carrying value of Catlin's historical unpaid losses and loss adjustment expenses, net of related reinsurance recoverable, to fair value as of the Acquisition Date. The estimated fair value consists of the present value of the expected net loss and loss adjustment expense payments plus a risk premium. This adjustment, plus the unamortized fair value adjustment included in Catlin's historical unpaid losses and loss adjustment expenses, will be amortized to losses and loss adjustment expenses over a weighted average period of approximately 20 years, based on the estimated payout pattern of net reserves as of the Acquisition Date.

• Net deferred tax liabilities - The adjustment to deferred tax liabilities is related to the deferred tax impact of the adjustments to fair value as noted above. This net increase of deferred tax liabilities is explained further in "Income Taxes" below.

• Non-controlling interest - The fair value was determined based on the last trade price of preferred shares issued by Catlin Insurance Company Limited ("Catlin-Bermuda"). See Note 9, "Share Capital" for further information.

Income Taxes

As part of the allocation of the purchase price, the Company recorded a total net deferred tax liability of $94.1 million. This is the combination of an excess of gross tax liabilities over gross tax assets by $22.1 million, and a valuation allowance of $72.0 million across several jurisdictions. The $94.1 million total net deferred tax liability is comprised of a deferred tax liability of $133.8 million related to the estimated fair value of the intangible assets recorded at the Acquisition Date, partially offset by deferred tax assets, net of associated valuation allowances, of $17.4 million related to loss carry forwards, $13.0 million related to fixed assets, and $8.8 million related to the fair value measurements of unpaid losses and loss adjustment expenses, and deferred acquisition costs and the value of business acquired. The remaining $0.5 million of deferred tax assets relates primarily to differences between financial reporting and tax bases of the other acquired assets and liabilities as of the Acquisition Date.

As a result of the Catlin Acquisition, the expected full year effective tax rate has been determined using a single rate approach taking into account the full year expected results, including the post-acquisition results of the acquired businesses.

In order to align all U.S. regulated entities under X.L. America, Inc., an indirect, wholly-owned subsidiary of XL-Ireland ("XLA"), the Company is seeking to have XLA purchase 100% of the stock of Catlin Inc. from Catlin North America Holdings, Ltd, a U.K. holding company. Subject to receipt of the necessary regulatory approvals, the Company intends to complete this restructuring by no later than October 31, 2015. If the restructuring occurs by the specified date, there would likely be a release of the valuation allowance currently held against the deferred tax asset maintained by Catlin Inc. which would result in a permanent tax benefit through operations.

Transaction-related Costs

The Company incurred certain acquisition and financing costs associated with the transaction. The Company has recorded $61.8 million of these costs for the six months ended June 30, 2015, of which $47.3 million has been included in Operating Expense and $14.5 million has been included in Interest Expense.

Transaction costs included in Operating Expense primarily consist of due diligence, legal, advisory and investment banking costs. Transaction costs included in Interest Expense related to the maintenance of the Bridge Facility. Pursuant to the terms of the Implementation Agreement, Catlin was required to pay its own costs and expenses in relation to the negotiation, preparation, execution and implementation of the Catlin Acquisition. Costs incurred by Catlin were recorded and paid by Catlin prior to the Acquisition Date and are not included within the Company's consolidated statements of income and comprehensive income.

10

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

As a part of the ongoing integration of Catlin's operations, the Company incurs costs associated with restructuring the systems, processes and workforce. These costs include such items as severance, retention, facilities and consulting and other costs. The Company separately identifies such costs and includes these expenses within Corporate and Other:

(U.S. dollars in thousands)	Severance costs		Retention costs		Facilities-related costs		Consulting and other
Costs incurred in 2015	$	12,274	$	365	$	1,530	$	13,676
2015 payments	1,639		—		462		4,573
Liabilities at June 30, 2015	$	10,635	$	365	$	1,068	$	9,103

Financial Results

The following table summarizes the results of the acquired Catlin operations since the Acquisition Date that have been included within the Company's consolidated statements of income and comprehensive income.

(U.S. dollars in thousands)	May 1, 2015 to June 30, 2015
Total revenues	$	709,800
Net income (loss) attributable to ordinary shareholders	$	50,017

Supplemental Pro Forma Information

The results of the acquired Catlin operations have been included in the Company's unaudited consolidated financial statements from the Acquisition Date to June 30, 2015. The following table presents unaudited pro forma consolidated information for the six months ended June 30, 2015 and 2014 and assumes the Catlin Acquisition occurred on January 1, 2014. The pro forma financial information is presented for informational purposes only and does not necessarily reflect the results that would have occurred had the acquisition taken place on January 1, 2014, nor is it necessarily indicative of future results. Significant adjustments used to determine pro forma results include amortization of intangible assets and amortization of fair value adjustments discussed above, and the corresponding income tax effects. Non-recurring transaction related costs noted above have been included in the unaudited pro forma results for the six months ended June 30, 2014.

	Unaudited Pro Forma
	Six Months Ended June 30,
(In thousands, except per share data)	2015		2014
Total revenues	$	5,427,900	$	5,736,519
Net income attributable to ordinary shareholders	960,951		107,279
Earnings (loss) per ordinary share and ordinary share equivalent – basic	3.14		0.33
Earnings (loss) per ordinary share and ordinary share equivalent – diluted	3.09		0.33

(b)    Sale of Strategic Operating Affiliate

On April 1, 2015, XL Re Ltd ("XL Re"), an indirect wholly-owned subsidiary of the Company, completed the previously announced sale of all of its shares in ARX Holding Corp. ("ARX") to The Progressive Corporation ("Progressive") pursuant to the terms of the Stock Purchase Agreement with Progressive. XL Re's shares in ARX represented approximately 40.6% of ARX's outstanding capital stock on a fully diluted basis at the time of the announcement. The carrying value of XL Re's shares in ARX was $220.2 million at the time of the sale.

XL Re received $560.6 million in proceeds from the transaction, which was based upon the consolidated tangible net book value of ARX and its subsidiaries as of December 31, 2014, and certain other factors. Thus, the Company recorded a gain of $340.4 million as a result of this transaction that is reflected in the unaudited consolidated statement of income for the three and six months endedJune 30, 2015.

(c)    Sale of Life Reinsurance Subsidiary

On May 1, 2014, a wholly owned subsidiary of the Company, XL Insurance (Bermuda) Ltd ("XLIB"), entered into a sale and purchase agreement with GreyCastle Holdings Ltd. ("GreyCastle") providing for the sale of 100% of the common shares of XLIB's wholly-owned subsidiary, XL Life Reinsurance (SAC) Ltd ("XLLR"), to GreyCastle for $570 million in cash (subsequent to the transaction, XLLR changed its name to GreyCastle Life Reinsurance (SAC) Ltd ("GCLR")). This transaction closed on May 30, 2014. As a result of the transaction, the Company ceded the majority of its life reinsurance business to GCLR via 100% quota share reinsurance (the "Life Retro Arrangements"). This transaction covered a substantial portion of our

11

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

life reinsurance reserves. The Company ceased writing new life reinsurance contracts in 2009 and since that time has been managing the run-off of its life reinsurance operations ("Run-Off Life Operations"). The designated investments that support the Life Retro Arrangements on a funds withheld basis ("Life Funds Withheld Assets") are managed pursuant to agreed investment guidelines that meet the contractual commitments of the Company's ceding subsidiaries and applicable laws and regulations. All of the investment results associated with the Life Funds Withheld Assets ultimately accrue to GCLR.

Because the Company no longer shares in the risks and rewards of the underlying performance of the supporting invested assets, disclosures within the financial statement notes included herein separate the Life Funds Withheld Assets from the rest of the Company's investments.

As of May 30, 2014, gross future policy benefit reserves relating to the Life operations were approximately $5.2 billion. Subsequent to the completion of the GreyCastle transaction, the Company retained approximately $0.4 billion of these reserves, and recorded a reinsurance recoverable from GCLR of $4.8 billion. Under the terms of the transaction, the Company continues to own, on a funds withheld basis, assets supporting the Life Retro Arrangements consisting of cash, fixed maturity securities and accrued interest. Based upon the right of offset, the funds withheld liability owing to GCLR is recorded net of future policy benefit reserves recoverable, and is included within "Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable)" on the unaudited consolidated balance sheets. The transaction resulted in an overall after-tax U.S. GAAP net loss of $621.3 million that is reflected in the unaudited consolidated statements of income for the three and six months ended June 30, 2014.

As of June 30, 2015, gross future policy benefit reserves relating to the Run-Off Life Operations were approximately $4.5 billion, of which the Company retained approximately $0.4 billion, after consideration of its future policy benefit reserves recoverable from GCLR of approximately $4.1 billion. The net funds withheld liability included within "Funds withheld on life retrocession arrangements, net of future policy benefit reserves recoverable" was $0.9 billion. The Company continued to own $5.0 billion of assets supporting the Life Retro Arrangements.

The impact of the Life Retro Arrangements on the Company's results was as follows:

Impact of Life Retro Arrangements	Three months ended June 30,						Six Months Ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Underwriting profit (loss) (1)	$	—		$	—		$	603		$	—
Net investment income - Life Funds Withheld Assets	46,864			19,165			97,283			19,165
Net realized gains (losses) on investments sold - Life Funds Withheld Assets	68,037			624			120,775			624
Net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets	(19,543		)	—			(18,783		)	—
OTTI on investments - Life Funds Withheld Assets	(2,878		)	(8,771		)	(8,087		)	(8,771		)
Exchange gains (losses)	(18,370		)	—			(14,686		)	—
Other income and expenses	3,773			(19		)	2,475			(19		)
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	239,174			(17,546		)	9,807			(17,546		)
Net income (loss)	$	317,057		$	(6,547	)	$	189,387		$	(6,547	)
Change in net unrealized gains (losses) on investments - Life Funds Withheld Assets, net of tax	(321,046		)	12,297			(283,931		)	12,297
Change in adjustments related to future policy benefit reserves, net of tax	26,328			—			86,684			—
Change in cumulative translation adjustment - Life Funds Withheld Assets, net of tax	(22,339		)	(5,750		)	8,463			(5,750		)
Total changes to other comprehensive income as a result of Life Retro Arrangements	$	(317,057	)	$	6,547		$	(188,784	)	$	6,547
Comprehensive income (loss)	$	—		$	—		$	603		$	—

____________

(1) The underwriting profit of $0.6 million relates to a premium adjustment during the six months ended June 30, 2015 relating to the Life Retro Arrangements transaction. Excluding this transaction, the impact to comprehensive income relating to the Life Retro Arrangements was nil for the three and six months ended June 30, 2015.

As shown in the table above, although the Company's net income (loss) is subject to variability related to the Life Retro Arrangements, there is minimal net impact on the Company's comprehensive income in any period. The life retrocession embedded derivative value includes the interest income, unrealized gains and losses, and realized gains and losses from sales on the Life Funds Withheld Assets subsequent to May 30, 2014.

4. Fair Value Measurements

Fair value is defined as the amount that would be received for the sale of an asset or paid to transfer a liability (an exit price), in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in

12

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. The Company reviews the fair value hierarchy classification on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy.

The fair values for available for sale investments are generally sourced from third parties. The fair value of fixed income securities is based upon quoted market values where available, "evaluated bid" prices provided by third party pricing services ("pricing services") where quoted market values are not available, or by reference to broker quotes where pricing services do not provide coverage for a particular security. While the Company receives values for the majority of the investment securities it holds from pricing services, it is ultimately management’s responsibility to determine whether the values received and recorded in the financial statements are representative of appropriate fair value measurements.

The Company performs regular reviews of the prices received from its third party valuation sources to assess if the prices represent a reasonable estimate of the fair value. This process is completed by investment and accounting personnel who are independent of those responsible for obtaining the valuations. The approaches taken by the Company include, but are not limited to, annual reviews of the controls of the external parties responsible for sourcing valuations, which are subjected to automated tolerance checks, quarterly reviews of the valuation sources and dates, and monthly reconciliations between the valuations provided by our external parties and valuations provided by our third party investment managers at a portfolio level.

Where broker quotes are the primary source of the valuations, sufficient information regarding the specific inputs utilized by the brokers is generally not available to support a Level 2 classification. The Company obtains the majority of broker quoted values from third party investment managers who perform independent verifications of these valuations using pricing matrices based upon information gathered by market traders. In addition, for the majority of these securities, the Company compares the broker quotes to independent valuations obtained from third party pricing vendors, which may also consist of broker quotes, to assess if the prices received represent a reasonable estimate of the fair value.

As discussed in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," under the Life Retro Arrangements, all of the investment results associated with the Life Funds Withheld Assets ultimately accrue to GCLR. Because the Company no longer shares in the risks and rewards of the underlying performance of the Life Funds Withheld Assets, the financial statements and accompanying notes included herein separately report the Life Funds Withheld Assets from the rest of the Company's investments.

For further information about the Company's fair value measurements, see Item 8, Note 2(b), "Significant Accounting Policies - Fair Value Measurements," to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

(a) Fair Value Summary

The following tables set forth the Company’s assets and liabilities that were accounted for at fair value as of June 30, 2015 and December 31, 2014 by level within the fair value hierarchy:

June 30, 2015 (U.S. dollars in thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Collateral and Counterparty Netting		Balance at June 30, 2015
Assets
Fixed maturities - Available for Sale ("AFS") - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	3,827,106	$	—	$	—	$	3,827,106
Corporate - Financials	—		3,225,513		10,000		—		3,235,513
Corporate - Non Financials (1)	—		6,946,510		5,554		—		6,952,064
Residential mortgage-backed securities – Agency ("RMBS - Agency")	—		3,955,106		3,038		—		3,958,144
Residential mortgage-backed securities – Non-Agency ("RMBS - Non-Agency")	—		372,271		—		—		372,271
Commercial mortgage-backed securities ("CMBS")	—		936,058		—		—		936,058
Collateralized debt obligations ("CDO")	—		3,854		484,171		—		488,025
Other asset-backed securities (1)	—		2,307,642		42,745		—		2,350,387

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XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

U.S. States and political subdivisions of the States	—		2,391,273		—		—			2,391,273
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		5,260,062		—		—			5,260,062
Total fixed maturities - AFS - Excluding Funds Withheld Assets, at fair value	$	—	$	29,225,395	$	545,508	$	—		$	29,770,903
Equity securities, at fair value	659,338		414,132		—		—			1,073,470
Short-term investments, at fair value (1)(2)	—		807,486		—		—			807,486
Total investments AFS - Excluding Funds Withheld Assets	$	659,338	$	30,447,013	$	545,508	$	—		$	31,651,859
Fixed maturities - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	13,678	$	—	$	—		$	13,678
Corporate - Financials	—		722,922		—		—			722,922
Corporate - Non Financials	—		1,665,678		—		—			1,665,678
RMBS – Agency	—		837		—		—			837
RMBS – Non-Agency	—		29,591		—		—			29,591
CMBS	—		145,617		—		—			145,617
Other asset-backed securities	—		187,537		—		—			187,537
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		1,231,228		—		—			1,231,228
Total fixed maturities - AFS - Life Funds Withheld Assets, at fair value	$	—	$	3,997,088	$	—	$	—		$	3,997,088
Total investments - AFS, at fair value	$	659,338	$	34,444,101	$	545,508	$	—		$	35,648,947
Fixed maturities - trading securities ("Trading")
U.S. Government and Government-Related/Supported	$	—	$	3,596	$	—	$	—		$	3,596
Corporate - Financials	—		187,169		—		—			187,169
Corporate - Non Financials	—		332,654		—		—			332,654
CMBS	—		261		—		—			261
Other asset-backed securities	—		14,823		—		—			14,823
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		252,981		—		—			252,981
Total fixed maturities - Trading, at fair value	$	—	$	791,484	$	—	$	—		$	791,484
Cash equivalents (3)	705,092		270,784		—		—			975,876
Cash equivalents - Life Funds Withheld Assets (3)	143		91,367		—		—			91,510
Other investments (4)	—		1,139,393		255,672		—			1,395,065
Other assets (5)	—		215,083		13,392		(3,239		)	225,236
Total assets accounted for at fair value	$	1,364,573	$	36,952,212	$	814,572	$	(3,239	)	$	39,128,118
Liabilities
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable) (6)	$	—	$	381,337	$	—	$	—		$	381,337
Financial instruments sold, but not yet purchased (7)	1,581		1,233		—		—			2,814
Other liabilities (5)	—		59,739		23,145		(3,239		)	79,645
Total liabilities accounted for at fair value	$	1,581	$	442,309	$	23,145	$	(3,239	)	$	463,796

14

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2014 (U.S. dollars in thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Collateral and Counterparty Netting			Balance at December 31, 2014
Assets
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	2,171,953	$	—	$	—		$	2,171,953
Corporate - Financials	—		2,761,916		—		—			$	2,761,916
Corporate - Non Financials (1)	—		6,010,563		5,894		—			$	6,016,457
Residential mortgage-backed securities – RMBS - Agency	—		3,726,666		1,910		—			$	3,728,576
Residential mortgage-backed securities – RMBS - Non-Agency	—		427,351		—		—			$	427,351
CMBS	—		1,052,544		—		—			$	1,052,544
CDO	—		4,076		687,958		—			$	692,034
Other asset-backed securities (1)	—		1,060,005		5,288		—			$	1,065,293
U.S. States and political subdivisions of the States	—		2,021,272		—		—			$	2,021,272
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		4,240,073		—		—			$	4,240,073
Total fixed maturities - AFS - Excluding Funds Withheld Assets, at fair value	$	—	$	23,476,419	$	701,050	$	—		$	24,177,469
Equity securities, at fair value	502,284		366,008		—		—			868,292
Short-term investments, at fair value (1)(2)	—		256,727		—		—			256,727
Total investments AFS - Excluding Funds Withheld Assets	$	502,284	$	24,099,154	$	701,050	$	—		$	25,302,488
Fixed maturities - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	18,724	$	—	$	—		$	18,724
Corporate - Financials	—		801,019		—		—			$	801,019
Corporate - Non Financials	—		2,016,961		—		—			$	2,016,961
RMBS – Agency	—		3,782		—		—			$	3,782
RMBS – Non-Agency	—		85,335		—		—			$	85,335
CMBS	—		193,167		—		—			$	193,167
Other asset-backed securities	—		273,541		—		—			$	273,541
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		1,789,036		—		—			$	1,789,036
Total fixed maturities - AFS - Life Funds Withheld Assets, at fair value	$	—	$	5,181,565	$	—	$	—		$	5,181,565
Total investments - AFS, at fair value	$	502,284	$	29,280,719	$	701,050	$	—		$	30,484,053
Fixed maturities - Trading
Corporate - Non Financials	—		1,171		—		—			$	1,171
Total fixed maturities - Trading, at fair value	$	—	$	1,171	$	—	$	—		$	1,171
Cash equivalents (3)	1,103,877		397,955		—		—			$	1,501,832
Cash equivalents - Life Funds Withheld Assets (3)	460		132,738		—		—			$	133,198
Other investments (4)	—		708,974		185,083		—			$	894,057
Other assets (5)	—		122,996		13,663		(696		)	$	135,963
Total assets accounted for at fair value	$	1,606,621	$	30,644,553	$	899,796	$	(696	)	$	33,150,274
Liabilities
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable) (6)	$	—	$	450,831	$	—	$	—		$	450,831
Financial instruments sold, but not yet purchased (7)	4,737		25,669		—		—			$	30,406
Other liabilities (5)	—		7,757		23,427		(696		)	$	30,488
Total liabilities accounted for at fair value	$	4,737	$	484,257	$	23,427	$	(696	)	$	511,725

____________

(1) Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes had a fair value of $75.3 million and $79.9 million and an amortized cost of $64.5 million and $68.4 million as of June 30, 2015 and December 31, 2014, respectively. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate values of these notes.

(2) Short-term investments consist primarily of Corporate securities and U.S. and Non-U.S. Government and Government-Related/Supported securities.

15

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(3) Cash equivalents balances subject to fair value measurement include certificates of deposit and money market funds. Operating cash balances are not subject to recurring fair value measurement guidance.

(4) The Other investments balance excludes certain structured transactions including certain investments in project finance transactions, and a payment obligation and liquidity financing provided to a structured credit vehicle as a part of a third party medium term note facility. These investments, which totaled $348.2 million as of June 30, 2015 and $354.4 million at December 31, 2014, are carried at amortized cost. For further information, see Item 8, Note 8, "Other Investments," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

(5) Other assets and other liabilities include derivative instruments. The derivative balances included in each category are reported on a gross basis by level with a netting adjustment presented separately in the Collateral and Counterparty Netting column. The fair values of the individual derivative contracts are reported gross in their respective levels based on the fair value hierarchy. For further details regarding derivative fair values and associated collateral received or paid see Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements.

(6) Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable) include balances related to the life retrocession embedded derivative, under which all investment results associated with the Life Funds Withheld Assets related to the Life Retro Arrangements described in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," accrue to the benefit of GCLR.

(7) Financial instruments sold, but not yet purchased, represent "short sales" and are included within "Payable for investments purchased" on the balance sheets.

(b) Level 3 Assets and Liabilities

The tables below present additional information about assets and liabilities measured at fair value on a recurring basis and for which Level 3 inputs were utilized to determine fair value. The tables present a reconciliation of the beginning and ending balances for the three and six months ended June 30, 2015 and 2014 for all financial assets and liabilities measured at fair value using significant unobservable inputs (Level 3) at June 30, 2015 and 2014, respectively. The tables do not include gains or losses that were reported in Level 3 in prior periods for assets that were transferred out of Level 3 prior to June 30, 2015 and 2014, respectively. Gains and losses for assets and liabilities classified within Level 3 in the table below may include changes in fair value that are attributable to both observable inputs (Levels 1 and 2) and unobservable inputs (Level 3). Further, it should be noted that the following tables do not take into consideration the effect of offsetting Level 1 and 2 financial instruments entered into by the Company that are either economically hedged by certain exposures to the Level 3 positions or that hedge the exposures in Level 3 positions.

In general, Level 3 assets include securities for which values were obtained from brokers where either significant inputs were utilized in determining the values that were difficult to corroborate with observable market data, or sufficient information regarding the specific inputs utilized by the broker was not available to support a Level 2 classification. Transfers into or out of Level 3 primarily arise as a result of the valuations utilized by the Company changing between either those provided by independent pricing services that do not contain significant unobservable inputs or other valuations sourced from brokers that are considered Level 3.

There were no significant transfers between Level 1 and Level 2 during each of the three and six months ended June 30, 2015 and 2014.

16

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

	Level 3 Assets and Liabilities -Three Months Ended June 30, 2015
(U.S. dollars in thousands)	Corporate - Financials		Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—	$	5,861		$	1,820		$	—
Realized gains (losses)	—		(140		)	—			—
Movement in unrealized gains (losses)	—		(44		)	(1		)	—
Purchases and issuances (1)	10,000		(123		)	1,297			—
Sales	—		—			—			—
Settlements	—		—			(78		)	—
Transfers into Level 3						—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	10,000	$	5,554		$	3,038		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	(184	)	$	(1	)	$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2015
(U.S. dollars in thousands)	CMBS		CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	—	$	496,923		$	2,244		$	—
Realized gains (losses)	—		224			92			—
Movement in unrealized gains (losses)	—		2,445			8			—
Purchases and issuances (1)	—		11,941			40,628			—
Sales	—		—						—
Settlements	—		(27,362		)	(227		)	—
Transfers into Level 3	—		—			—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	—	$	484,171		$	42,745		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	2,057		$	100		$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2015
(U.S. dollars in thousands)			Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period			$	—		$	190,097		$	(9,606	)
Realized gains (losses)			—			1,291			—
Movement in unrealized gains (losses)			—			(139		)	(147		)
Purchases and issuances (1)			—			66,510			—
Sales			—
Settlements			—			(2,087		)	—
Transfers into Level 3			—			—			—
Transfers out of Level 3			—			—			—
Fixed maturities to short-term investments classification change			—			—			—
Balance, end of period			$	—		$	255,672		$	(9,753	)
Movement in total gains (losses) above relating to instruments still held at the reporting date			$	—		$	1,152		$	(147	)

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

17

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

	Level 3 Assets and Liabilities -Three Months Ended June 30, 2014
(U.S. dollars in thousands)	Corporate - Financials			Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—		$	4,382		$	8,928		$	11
Realized gains (losses)	—			35			6			—
Movement in unrealized gains (losses)	—			(93		)	(13		)	—
Purchases and issuances (1)	—			8			—			—
Sales	—			—			—			—
Settlements	—			(399		)	(2,025		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			—			—			—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	—		$	3,933		$	6,896		$	11
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	(58	)	$	(6	)	$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2014
(U.S. dollars in thousands)	CMBS			CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	5,926		$	718,827		$	10,673		$	—
Realized gains (losses)	2			875			(5		)	—
Movement in unrealized gains (losses)	(1		)	8,331			144			—
Purchases and issuances (1)	1,376			75,201			3,000			—
Sales	—			(30,892		)	—			—
Settlements	(5,358		)	(39,518		)	(2,108		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			—			—			—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	1,945		$	732,824		$	11,704		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	8,247		$	140		$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2014
(U.S. dollars in thousands)				Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period				$	—		$	116,418		$	(32,496	)
Realized gains (losses)				—			5,127			—
Movement in unrealized gains (losses)				—			(1,779		)	13,586
Purchases and issuances (1)				—			9,997			—
Sales				—			—			—
Settlements				—			(5,288		)	—
Transfers into Level 3				—			—			—
Transfers out of Level 3				—			—			—
Fixed maturities to short-term investments classification change				—			—			—
Balance, end of period				$	—		$	124,475		$	(18,910	)
Movement in total gains (losses) above relating to instruments still held at the reporting date				$	—		$	3,348		$	13,586

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

18

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

	Level 3 Assets and Liabilities - Six Months Ended June 30, 2015
(U.S. dollars in thousands)	Corporate - Financials		Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—	$	5,894		$	1,910		$	—
Realized gains (losses)	—		(141		)	—			—
Movement in unrealized gains (losses)	—		4			(2		)	—
Purchases and issuances (1)	10,000		(123		)	1,297			—
Sales	—		—			—			—
Settlements	—		(80		)	(167		)	—
Transfers into Level 3	—		—			—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	10,000	$	5,554		$	3,038		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	(136	)	$	—		$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2015
(U.S. dollars in thousands)	CMBS		CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	—	$	687,958		$	5,288		$	—
Realized gains (losses)	—		260			91			—
Movement in unrealized gains (losses)	—		8,000			10			—
Purchases and issuances (1)	—		11,941			40,628			—
Sales	—		(155,085		)	—			—
Settlements	—		(68,903		)	(3,272		)	—
Transfers into Level 3	—		—			—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	—	$	484,171		$	42,745		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	4,725		$	100		$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2015
(U.S. dollars in thousands)			Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period			$	—		$	185,083		$	(9,764	)
Realized gains (losses)			—			2,593			—
Movement in unrealized gains (losses)			—			(1,966		)	11
Purchases and issuances (1)			—			73,303			—
Sales			—			—			—
Settlements			—			(3,341		)	—
Transfers into Level 3			—			—			—
Transfers out of Level 3			—			—			—
Fixed maturities to short-term investments classification change			—			—			—
Balance, end of period			$	—		$	255,672		$	(9,753	)
Movement in total gains (losses) above relating to instruments still held at the reporting date			$	—		$	628		$	11

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

19

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

	Level 3 Assets and Liabilities - Six Months Ended June 30, 2014
(U.S. dollars in thousands)	Corporate - Financials			Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—		$	31,573		$	10,473		$	9
Realized gains (losses)	—			155			6			—
Movement in unrealized gains (losses)	—			(96		)	(13		)	2
Purchases and issuances (1)	—			1,443			—			—
Sales	—			—			—			—
Settlements	—			(5,513		)	(2,598		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			(23,629		)	(972		)	—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	—		$	3,933		$	6,896		$	11
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	90		$	(6	)	$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2014
(U.S. dollars in thousands)	CMBS			CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	12,533		$	710,253		$	11,877		$	—
Realized gains (losses)	3			2,456			(20		)	—
Movement in unrealized gains (losses)	(3		)	12,013			206			—
Purchases and issuances (1)	1,376			103,015			3,000			—
Sales	—			(40,824		)	—			—
Settlements	(11,964		)	(54,089		)	(3,359		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			—			—			—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	1,945		$	732,824		$	11,704		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	13,216		$	186		$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2014
(U.S. dollars in thousands)				Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period				$	2,015		$	113,472		$	(29,110	)
Realized gains (losses)				—			8,691			—
Movement in unrealized gains (losses)				(15		)	(282		)	10,200
Purchases and issuances (1)				—			21,086			—
Sales				—			—			—
Settlements				(2,000		)	(18,492		)	—
Transfers into Level 3				—			—			—
Transfers out of Level 3				—			—			—
Fixed maturities to short-term investments classification change				—			—			—
Balance, end of period				$	—		$	124,475		$	(18,910	)
Movement in total gains (losses) above relating to instruments still held at the reporting date				$	—		$	8,409		$	10,200

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

20

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(c) Fixed maturities and short-term investments

The Company’s Level 3 assets consist primarily of CDOs, for which non-binding broker quotes are the primary source of the valuations. Sufficient information regarding the specific inputs utilized by the brokers was not available to support a Level 2 classification. The Company obtains the majority of broker quotes for these CDOs from third party investment managers who perform independent verifications of these valuations using pricing matrices based upon information gathered by market traders. In addition, for the majority of these securities, the Company compares the broker quotes to independent valuations obtained from third party pricing vendors, which may also consist of broker quotes, to assess if the prices received represent a reasonable estimate of the fair value. Although the Company does not have access to the specific unobservable inputs that may have been used in the fair value measurements of the CDO securities provided by brokers, we would expect that the significant inputs considered are prepayment rates, probability of default, loss severity in the event of default, recovery rates, liquidity premium and reinvestment rates. Significant increases (decreases) in any of those inputs in isolation could result in a significantly different fair value measurement. Generally, a change in the assumption used for the probability of default is accompanied by a directionally similar change in the assumption used for the loss severity and a directionally opposite change in the assumption used for prepayment rates.

The remainder of the Level 3 assets relate primarily to private investment funds and certain derivative positions as described below.

(d) Other investments

Included within the Other investments component of the Company’s Level 3 valuations are private investments and alternative fund investments where the Company is not deemed to have significant influence over the investee. The fair value of these investments is based upon net asset values received from the investment manager or general partner of the respective entity. The nature of the underlying investments held by the investee that form the basis of the net asset value include assets such as private business ventures and are such that significant Level 3 inputs are utilized in the determination of the individual underlying holding values and, accordingly, the fair value of the Company’s investment in each entity is classified within Level 3. The Company has not adjusted the net asset values received; however, management incorporates factors such as the most recent financial information received, annual audited financial statements and the values at which capital transactions with the investee take place when applying judgment regarding whether any adjustments should be made to the net asset value in recording the fair value of each position. Investments in alternative funds included in Other investments utilize strategies including arbitrage, directional, event driven and multi-style. These funds potentially have lockup and gate provisions which may limit redemption liquidity. For further details regarding the nature of Other investments and related features see Item 8, Note 8, "Other Investments," to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

(e) Derivative instruments

Derivative instruments recorded within Other liabilities and classified within Level 3 include credit derivatives providing protection on senior tranches of structured finance transactions where the value is obtained directly from the investment bank counterparty and sufficient information regarding the inputs utilized in such valuation was not obtained to support a Level 2 classification and guaranteed minimum income benefits embedded within one reinsurance contract. The majority of inputs utilized in the valuations of these types of derivative contracts are considered Level 1 or Level 2; however, each valuation includes at least one Level 3 input that was significant to the valuation and, accordingly, the values are disclosed within Level 3.

The calculation of the change in fair value of the embedded derivative associated with the Life Retro Arrangements includes interest income and realized and unrealized gains and losses on Life Funds Withheld Assets and certain related expenses related to the Life Funds Withheld Assets. The fair value of the embedded derivative is included in "Funds withheld on life retrocession arrangements, net of future policy benefit reserves recoverable" on the consolidated balance sheets. The fair value of the embedded derivative is considered a Level 2 valuation.

(f) Financial Instruments Not Carried at Fair Value

Authoritative guidance over disclosures about the fair value of financial instruments requires additional disclosure of fair value information for financial instruments not carried at fair value in both interim and annual reporting periods. Certain financial instruments, particularly insurance contracts, are excluded from these fair value disclosure requirements. The carrying values of cash and cash equivalents, accrued investment income, net receivable from investments sold, other assets, net payable for investments purchased, other liabilities and other financial instruments not included below approximated their fair values. The following table includes financial instruments for which the carrying value differs from the estimated fair values as of June 30, 2015 and December 31, 2014. All of these fair value estimates are considered Level 2 fair value measurements. The

21

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

fair values for fixed maturities held to maturity are provided by third party pricing vendors and significant valuation inputs for all other items included were based upon market data obtained from sources independent of the Company, and are subject to the same control environment previously described.

	June 30, 2015				December 31, 2014
(U.S. dollars in thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial Assets - Other investments, structured transactions	$	348,192	$	365,335	$	354,382	$	371,625
Deposit liabilities	$	1,212,206	$	1,528,520	$	1,245,367	$	1,543,761
Notes payable and debt	2,726,455		2,911,949		1,662,580		1,897,854
Financial Liabilities	$	3,938,661	$	4,440,469	$	2,907,947	$	3,441,615

The Company historically participated in structured transactions. Remaining structured transactions include cash loans supporting project finance transactions, a liquidity facility financing provided to structured project deals and an investment in a payment obligation with an insurance company. These transactions are carried at amortized cost. The fair value of these investments held by the Company is determined through use of internal models utilizing reported trades, benchmark yields, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data.

Deposit liabilities include obligations under structured insurance and reinsurance transactions. For purposes of fair value disclosures, the Company determined the estimated fair value of the deposit liabilities by assuming a discount rate equal to the appropriate U.S. Treasury rate plus 48.6 basis points and 29.5 basis points as of June 30, 2015 and December 31, 2014, respectively. The discount rate incorporates the Company’s own credit risk into the determination of estimated fair value.

The fair values of the Company’s notes payable and debt outstanding were determined based on quoted market prices.

There are no significant concentrations of credit risk within the Company’s financial instruments as defined in the authoritative guidance over disclosures of fair value of financial instruments not carried at fair value, which excludes certain financial instruments, particularly insurance contracts.

5. Segment Information

The Company is organized into two operating segments: Insurance and Reinsurance. Subsequent to the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition," the underwriting results of the acquired businesses from the Acquisition Date through June 30, 2015 are included in the Company's Insurance or Reinsurance segment, as appropriate.

The Company’s general investment and financing operations are reflected in "Corporate and Other". Subsequent to the transaction described in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," GCLR reinsures the majority of the Company's life reinsurance business through the Life Retro Arrangements. The results of the Run-Off Life Operations not subject to the Life Retro Arrangements are also reported within Corporate and Other.

The Company evaluates the performance of both the Insurance and Reinsurance segments based on underwriting profit. Other items of revenue and expenditure of the Company are not evaluated at the segment level. In addition, the Company does not allocate investment assets used to support its Property and Casualty ("P&C") operations to the individual segments, except as noted below. Investment assets related to the Company’s Run-Off Life Operations and certain structured products included in the Insurance and Reinsurance segments are held in separately identified portfolios. As such, net investment income from these assets is included in the contribution from the applicable segment or in Corporate and Other. The following tables summarize the segment results for the three and six months ended June 30, 2015 and 2014:

22

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Three Months Ended June 30, 2015 (U.S. dollars in thousands, except ratios)	Insurance			Reinsurance			Total P&C			Corporate and Other (1)			Total
Gross premiums written	$	2,219,444		$	782,248		$	3,001,692		$	79,443		$	3,081,135
Net premiums written	1,401,772			698,301			2,100,073			18,258			2,118,331
Net premiums earned	1,412,906			650,889			2,063,795			18,258			2,082,053
Net losses and loss expenses (2)	896,370			254,825			1,151,195			22,081			1,173,276
Acquisition costs (2)	181,716			158,217			339,933			1,684			341,617
Operating expenses (3)	292,161			71,727			363,888			(59		)	363,829
Underwriting profit (loss)	$	42,659		$	166,120		$	208,779		$	(5,448	)	$	203,331
Net investment income - excluding Life Funds Withheld Assets (4)							149,461			10,831			160,292
Net investment income - Life Funds Withheld Assets										46,864			46,864
Net results from structured products (5)	3,401			1,856			5,257			—			5,257
Net fee income and other (6)	(2,033		)	623			(1,410		)	46			(1,364		)
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets							4,223			128			4,351
Net realized gains (losses) on investments and net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets							—			45,616			45,616
Net realized and unrealized gains (losses) on derivative instruments							—			48,509			48,509
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets							—			239,174			239,174
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			40,839			40,839
Gain on sale of operating affiliate							—			340,407			340,407
Exchange (gains) losses							—			10,374			10,374
Corporate operating expenses							—			130,987			130,987
Contribution from P&C and Corporate and Other							366,310			625,605			991,915
Interest expense (8)										39,038			39,038
Non-controlling interests										4,879			4,879
Income tax expense										32,959			32,959
Net income (loss) attributable to ordinary shareholders													$	915,039
Ratios – P&C operations: (9)
Loss and loss expense ratio	63.4		%	39.2		%	55.8		%
Underwriting expense ratio	33.6		%	35.3		%	34.1		%
Combined ratio	97.0		%	74.5		%	89.9		%

____________

(1) Corporate and Other includes other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest expense of $16.0 million and $10.6 million, respectively.

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

(7) The Company generally 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.

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

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

23

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

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 (2)	627,627			200,253			827,880			85,299			913,179
Acquisition costs (2)	99,863			80,874			180,737			3,882			184,619
Operating expenses (3)	213,930			47,582			261,512			2,209			263,721
Underwriting profit (loss)	$	62,570		$	105,377		$	167,947		$	(32,872	)	$	135,075
Net investment income - excluding Life Funds Withheld Assets (4)							144,555			52,118			196,673
Net investment income - Life Funds Withheld Assets										19,165			19,165
Net results from structured products (5)	31,645			3,240			34,885			—			34,885
Net fee income and other (6)	(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 and net unrealized gains (losses) on investments, Trading - 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 and derivative instruments - Life Funds Withheld Assets							—			(17,546		)	(17,546		)
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			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							422,989			(671,937		)	(248,948		)
Interest expense (8)										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													$	(279,260	)
Ratios – P&C operations: (9)
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 other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest credit of $16.9 million and $18.2 million, respectively.

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

(7) The Company generally 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.

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

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

24

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Six Months Ended June 30, 2015 (U.S. dollars in thousands, except ratios)	Insurance			Reinsurance			Total P&C			Corporate and Other (1)			Total
Gross premiums written	$	3,874,191		$	1,607,910		$	5,482,101		$	154,394		$	5,636,495
Net premiums written	2,490,880			1,445,936			3,936,816			32,764			3,969,580
Net premiums earned	2,375,212			1,008,077			3,383,289			32,764			3,416,053
Net losses and loss expenses (2)	1,513,317			407,705			1,921,022			41,468			1,962,490
Acquisition costs (2)	262,103			229,709			491,812			3,501			495,313
Operating expenses (3)	500,618			114,222			614,840			872			615,712
Underwriting profit (loss)	$	99,174		$	256,441		$	355,615		$	(13,077	)	$	342,538
Net investment income - excluding Life Funds Withheld Assets (4)							282,269			21,041			303,310
Net investment income - Life Funds Withheld Assets										97,283			97,283
Net results from structured products (5)	6,306			3,976			10,282			—			10,282
Net fee income and other (6)	(9,498		)	1,448			(8,050		)	178			(7,872		)
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets							10,030			(1,077		)	8,953
Net realized gains (losses) on investments and net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets							—			93,905			93,905
Net realized and unrealized gains (losses) on derivative instruments							—			65,030			65,030
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets							—			9,807			9,807
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			98,836			98,836
Gain on sale of operating affiliate										340,407			340,407
Exchange (gains) losses							—			37,764			37,764
Corporate operating expenses							—			193,430			193,430
Contribution from P&C and Corporate and Other							650,146			481,139			1,131,285
Interest expense (8)										80,519			80,519
Non-controlling interests										42,269			42,269
Income tax expense										57,177			57,177
Net income (loss) attributable to ordinary shareholders													$	951,320
Ratios – P&C operations: (9)
Loss and loss expense ratio	63.7		%	40.4		%	56.8		%
Underwriting expense ratio	32.1		%	34.2		%	32.7		%
Combined ratio	95.8		%	74.6		%	89.5		%

____________

(1) Corporate and Other includes other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest expense of $31.1 million and $20.6 million, respectively.

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

(7) The Company generally 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.

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

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

25

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

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 (2)	1,266,820			392,565			1,659,385			198,886			1,858,271
Acquisition costs (2)	204,863			168,109			372,972			11,061			384,033
Operating expenses (3)	416,983			88,443			505,426			5,397			510,823
Underwriting profit (loss)	$	107,764		$	205,057		$	312,821		$	(80,515	)	$	232,306
Net investment income - excluding Life Funds Withheld Assets (4)							288,082			123,010			411,092
Net investment income - Life Funds Withheld Assets										19,165			19,165
Net results from structured products (5)	36,535			6,303			42,838			—			42,838
Net fee income and other (6)	(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 and net unrealized gains (losses) on investments, Trading - 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 and derivative instruments - Life Funds Withheld Assets							—			(17,546		)	(17,546		)
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			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							736,470			(627,461		)	109,009
Interest expense (8)										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													$	(23,543	)
Ratios – P&C operations: (9)
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 other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest credit of $35.7 million and $7.4 million, respectively.

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

(7) The Company generally 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.

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

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

26

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The following tables summarize the Company’s net premiums earned by line of business for the three and six months ended June 30, 2015 and 2014:

Three Months Ended June 30, 2015 (U.S. dollars in thousands)	Insurance			Reinsurance		Corporate and Other		Total
P&C Operations:
Professional	$	286,348		$	43,225	$	—	$	329,573
Casualty	420,472			125,787		—		546,259
Property catastrophe	—			163,453		—		163,453
Property	215,128			231,897		—		447,025
Marine, energy, aviation and satellite	(16		)	32,549		—		32,533
Specialty	411,438			—		—		411,438
Other (1)	79,536			53,978		—		133,514
Total P&C Operations	$	1,412,906		$	650,889	$	—	$	2,063,795
Corporate and Other:
Run-off Life operations - Annuity	$	—		$	—	$	1	$	1
Run-off Life operations - Other Life	—			—		18,257		18,257
Total Corporate and Other	$	—		$	—	$	18,258	$	18,258
Total	$	1,412,906		$	650,889	$	18,258	$	2,082,053
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	$	—		$	—	$	21,564	$	21,564
Run-off Life operations - Other Life	—			—		36,954		36,954
Total Corporate and Other	$	—		$	—	$	58,518	$	58,518
Total	$	1,003,990		$	434,086	$	58,518	$	1,496,594

____________

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

27

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Six Months Ended June 30, 2015 (U.S. dollars in thousands)	Insurance			Reinsurance		Corporate and Other		Total
P&C Operations:
Professional	$	552,759		$	78,233	$	—	$	630,992
Casualty	729,807			183,995		—		913,802
Property catastrophe	—			257,526		—		257,526
Property	343,369			363,121		—		706,490
Marine, energy, aviation and satellite	(16		)	50,624		—		50,608
Specialty	596,162			—		—		596,162
Other (1)	153,131			74,578		—		227,709
Total P&C Operations	$	2,375,212		$	1,008,077	$	—	$	3,383,289
Corporate and Other:
Run-off Life operations - Annuity	$	—		$	—	$	—	$	—
Run-off Life operations - Other Life	—			—		32,764		32,764
Total Corporate and Other	$	—		$	—	$	32,764	$	32,764
Total	$	2,375,212		$	1,008,077	$	32,764	$	3,416,053
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	$	—		$	—	$	53,361	$	53,361
Run-off Life operations - Other Life	—			—		81,468		81,468
Total Corporate and Other	$	—		$	—	$	134,829	$	134,829
Total	$	1,996,430		$	854,174	$	134,829	$	2,985,433

____________

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

6. Investments

(a) Fixed Maturities, Short-Term Investments and Equity Securities

Classification of Fixed Income Securities

During the second quarter of 2014, fixed maturities with a carrying value of $2.8 billion were reclassified from held to maturity ("HTM") to AFS in conjunction with the sale of XLLR, discussed in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary." As a result, the Company no longer holds HTM securities. Gross unrealized gains and gross unrealized losses, net of tax, of $424.9 million and nil, respectively, related to these securities were recognized in other comprehensive income on the date of transfer. For certain annuity contracts that are subject to the Life Retro Arrangements, policy benefit reserves were historically increased for the impact of changes in unrealized gains on investments supporting such contracts as if the gains had been realized, with a corresponding entry to other comprehensive income ("Shadow Adjustments"). In conjunction with the sale of XLLR and the related reclassification of securities from HTM to AFS, the Company recorded an additional gross charge of $440.5 million, net of tax, as a reduction of comprehensive income for such Shadow Adjustments on the date of the transfer. See Note 15, "Accumulated Other Comprehensive Income (Loss)," for further information.

All of the reclassified securities are included within the Life Funds Withheld Assets, along with certain other available for sale securities as defined in the sale and purchase agreement relating to the sale of XLLR. The Life Funds Withheld Assets are managed pursuant to agreed investment guidelines that meet the contractual commitments of the XL ceding companies and applicable laws and regulations. All of the investment results associated with the Life Funds Withheld Assets ultimately accrue

28

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

to GCLR. Because the Company no longer shares in the risks and rewards of the underlying performance of the Life Funds Withheld Assets, disclosures within the financial statements and accompanying notes included herein separate the Life Funds Withheld Assets from the rest of the Company's investments.

Amortized Cost and Fair Value Summary

The cost (amortized cost for fixed maturities and short-term investments), fair value, gross unrealized gains and gross unrealized (losses), including non-credit related OTTI recorded in accumulated other comprehensive income ("AOCI"), of the Company’s AFS investments as of June 30, 2015 and December 31, 2014, were as follows:

June 30, 2015 (U.S. dollars in thousands)	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Non-credit Related OTTI (1)
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	3,786,878	$	56,994	$	(16,766	)	$	3,827,106	$	—
Corporate - Financials	3,194,676		61,404		(20,567		)	3,235,513		—
Corporate - Non Financials (2)	6,792,840		209,968		(50,744		)	6,952,064		(3,309		)
RMBS – Agency	3,890,265		88,699		(20,820		)	3,958,144		—
RMBS – Non-Agency	361,661		28,531		(17,921		)	372,271		(57,074		)
CMBS	929,466		14,903		(8,311		)	936,058		(1,598		)
CDO	505,865		6,733		(24,573		)	488,025		(1,625		)
Other asset-backed securities (2)	2,326,633		35,669		(11,915		)	2,350,387		(1,516		)
U.S. States and political subdivisions of the States	2,301,628		101,435		(11,790		)	2,391,273		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	5,220,879		111,046		(71,863		)	5,260,062		—
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	29,310,791	$	715,382	$	(255,270	)	$	29,770,903	$	(65,122	)
Total short-term investments - Excluding Life Funds Withheld Assets	$	806,990	$	1,190	$	(694	)	$	807,486	$	—
Total equity securities - Excluding Life Funds Withheld Assets	$	964,038	$	136,219	$	(26,787	)	$	1,073,470	$	—
Total investments - AFS - Excluding Life Funds Withheld Assets	$	31,081,819	$	852,791	$	(282,751	)	$	31,651,859	$	(65,122	)
Fixed maturities - AFS - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	11,501	$	2,177	$	—		$	13,678	$	—
Corporate - Financials	639,699		83,223		—			722,922		—
Corporate - Non Financials	1,439,134		226,544		—			1,665,678		—
RMBS – Agency	674		163		—			837		—
RMBS – Non-Agency	26,377		3,214		—			29,591		—
CMBS	126,539		19,078		—			145,617		—
Other asset-backed securities	164,779		22,758		—			187,537		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	980,215		251,013		—			1,231,228		—
Total fixed maturities - AFS - Life Funds Withheld Assets	$	3,388,918	$	608,170	$	—		$	3,997,088	$	—
Total investments - AFS	$	34,470,737	$	1,460,961	$	(282,751	)	$	35,648,947	$	(65,122	)
Fixed maturities - Trading - Life Funds Withheld Assets								Amortized Cost		Fair Value
U.S. Government and Government-Related/Supported								$	3,628	$	3,596
Corporate - Financials								194,385		187,169
Corporate - Non Financials								343,658		332,654
CMBS								262		261
Other asset-backed securities								15,016		14,823
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported								254,100		252,981
Total investments - Trading - Life Funds Withheld Assets								$	811,049	$	791,484

___________

(1) Represents the non-credit component of OTTI losses, adjusted for subsequent sales of securities. It does not include the change in fair value subsequent to the date an impairment was recorded.

(2) Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $75.3 million and an amortized cost of $64.5 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

29

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2014 (U.S. dollars in thousands)	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Non-credit Related OTTI (1)
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	2,100,851	$	77,889	$	(6,787	)	$	2,171,953	$	—
Corporate - Financials	2,687,797		87,058		(12,939		)	2,761,916		—
Corporate - Non Financials (2)	5,774,333		278,747		(36,623		)	6,016,457		(3,309		)
RMBS – Agency	3,625,171		114,188		(10,783		)	3,728,576		—
RMBS – Non-Agency	404,398		41,108		(18,155		)	427,351		(67,918		)
CMBS	1,033,819		23,987		(5,262		)	1,052,544		(2,033		)
CDO	717,544		1,659		(27,169		)	692,034		(1,663		)
Other asset-backed securities (2)	1,028,528		42,810		(6,045		)	1,065,293		(1,797		)
U.S. States and political subdivisions of the States	1,892,566		129,910		(1,204		)	2,021,272		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	4,162,425		139,484		(61,836		)	4,240,073		—
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	23,427,432	$	936,840	$	(186,803	)	$	24,177,469	$	(76,720	)
Total short-term investments - Excluding Life Funds Withheld Assets	$	257,221	$	49	$	(543	)	$	256,727	$	—
Total equity securities - Excluding Life Funds Withheld Assets	$	763,833	$	130,689	$	(26,230	)	$	868,292	$	—
Total investments - AFS - Excluding Life Funds Withheld Assets	$	24,448,486	$	1,067,578	$	(213,576	)	$	25,302,488	$	(76,720	)
Fixed maturities - AFS - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	14,866	$	3,858	$	—		$	18,724	$	—
Corporate - Financials	701,587		99,432		—			801,019		—
Corporate - Non Financials	1,706,262		310,699		—			2,016,961		—
RMBS – Agency	3,301		481		—			3,782		—
RMBS – Non-Agency	71,075		14,260		—			85,335		—
CMBS	168,886		24,281		—			193,167		—
Other asset-backed securities	238,168		35,373		—			273,541		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	1,397,194		391,842		—			1,789,036		—
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	4,301,339	$	880,226	$	—		$	5,181,565	$	—
Total investments - AFS	$	28,749,825	$	1,947,804	$	(213,576	)	$	30,484,053	$	(76,720	)
Fixed maturities - Trading - Life Funds Withheld Assets								Amortized Cost		Fair Value
Corporate - Non Financials								$	1,180	$	1,171
Total investments - Trading - Life Funds Withheld Assets								$	1,180	$	1,171

____________

(1) Represents the non-credit component of OTTI losses, adjusted for subsequent sales of securities. It does not include the change in fair value subsequent to the date an impairment was recorded.

(2) Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $79.9 million and an amortized cost of $68.4 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

As of June 30, 2015 and December 31, 2014, approximately 2.5% and 3.0%, respectively, of the Company's fixed income investment portfolio at fair value, excluding Life Funds Withheld Assets, was invested in securities that were below investment grade or not rated. Approximately 14.8% and 24.9% of the gross unrealized losses in the Company's fixed income investment portfolio, excluding Life Funds Withheld Assets, as of June 30, 2015 and December 31, 2014, respectively, related to securities that were below investment grade or not rated.

30

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Contractual Maturities Summary

The contractual maturities of AFS fixed income securities at June 30, 2015 and December 31, 2014 are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	June 30, 2015				December 31, 2014
(U.S. dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
Due less than one year	$	1,957,896	$	1,962,391	$	1,972,224	$	1,980,429
Due after 1 through 5 years	12,409,937		12,584,530		8,919,037		9,113,651
Due after 5 through 10 years	5,231,268		5,305,166		4,232,396		4,412,569
Due after 10 years	1,697,800		1,813,931		1,494,315		1,705,022
	$	21,296,901	$	21,666,018	$	16,617,972	$	17,211,671
RMBS – Agency	3,890,265		3,958,144		3,625,171		3,728,576
RMBS – Non-Agency	361,661		372,271		404,398		427,351
CMBS	929,466		936,058		1,033,819		1,052,544
CDO	505,865		488,025		717,544		692,034
Other asset-backed securities	2,326,633		2,350,387		1,028,528		1,065,293
Total mortgage and asset-backed securities	$	8,013,890	$	8,104,885	$	6,809,460	$	6,965,798
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	29,310,791	$	29,770,903	$	23,427,432	$	24,177,469
Fixed maturities - AFS - Life Funds Withheld Assets
Due less than one year	$	87,963	$	96,402	$	117,048	$	125,326
Due after 1 through 5 years	468,476		505,063		638,526		685,787
Due after 5 through 10 years	705,507		808,909		1,004,698		1,165,348
Due after 10 years	1,808,603		2,223,132		2,059,637		2,649,279
	$	3,070,549	$	3,633,506	$	3,819,909	$	4,625,740
RMBS – Agency	674		837		3,301		3,782
RMBS – Non-Agency	26,377		29,591		71,075		85,335
CMBS	126,539		145,617		168,886		193,167
Other asset-backed securities	164,779		187,537		238,168		273,541
Total mortgage and asset-backed securities	$	318,369	$	363,582	$	481,430	$	555,825
Total fixed maturities - AFS - Life Funds Withheld Assets	$	3,388,918	$	3,997,088	$	4,301,339	$	5,181,565
Total fixed maturities - AFS	$	32,699,709	$	33,767,991	$	27,728,771	$	29,359,034
Fixed maturities - Trading - Life Funds Withheld Assets
Due less than one year	$	42,557	$	42,553	$	—	$	—
Due after 1 through 5 years	221,522		220,727		—		—
Due after 5 through 10 years	162,877		160,923		1,180		1,171
Due after 10 years	368,815		352,197		—		—
	$	795,771	$	776,400	$	1,180	$	1,171
CMBS	262		261		—		—
Other asset-backed securities	15,016		14,823		—		—
Total mortgage and asset-backed securities	$	15,278	$	15,084	$	—	$	—
Total fixed maturities - Trading - Life Funds Withheld Assets	$	811,049	$	791,484	$	1,180	$	1,171

OTTI Considerations

Under final authoritative accounting guidance, a debt security for which amortized cost exceeds fair value is deemed to be other-than-temporarily impaired if it meets either of the following conditions: (a) the Company intends to sell, or it is more likely than not that the Company will be required to sell, the security before a recovery in value, or (b) the Company does not expect to recover the entire amortized cost basis of the security. Other than in a situation in which the Company has the intent to sell a debt security or more likely than not will be required to sell a debt security, the amount of the OTTI related to a credit loss on the security is recognized in earnings, and the amount of the OTTI related to other factors (e.g., interest rates, market conditions, etc.) is recorded as a component of OCI. The net amount recognized in earnings ("credit loss impairment") represents the difference between the amortized cost of the security and the net present value of its projected future cash flows

31

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

discounted at the effective interest rate implicit in the debt security prior to impairment ("NPV"). The remaining difference between the security's NPV and its fair value is recognized in OCI. Subsequent changes in the fair value of these securities are included in OCI unless a further impairment is deemed to have occurred.

In the scenario where the Company has the intent to sell a security in which its amortized cost exceeds its fair value, or it is more likely than not that it will be required to sell such a security, the entire difference between the security's amortized cost and its fair value is recognized in earnings.

The determination of credit loss impairment is based on detailed analyses of underlying cash flows and other considerations. Such analyses require the use of certain assumptions to develop the estimated performance of underlying collateral. Key assumptions used include, but are not limited to, items such as RMBS default rates based on collateral duration in arrears, severity of losses on default by collateral class, collateral reinvestment rates and expected future general corporate default rates.

Factors considered for all securities on a quarterly basis in determining that a gross unrealized loss is not other-than-temporarily impaired include management's consideration of current and near term liquidity needs and other available sources of funds, an evaluation of the factors and time necessary for recovery and an assessment of whether the Company has the intention to sell or considers it more likely than not that it will be forced to sell a security.

Pledged Assets

Certain of the Company's invested assets are held in trust and pledged in support of insurance and reinsurance liabilities as well as credit facilities. Such pledges are largely required by the Company's operating subsidiaries that are "non-admitted" under U.S. state insurance regulations, in order for the U.S. cedant to receive statutory credit for reinsurance. Also included are Life Funds Withheld Assets as noted in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary." Additionally, certain deposit liabilities and annuity contracts require the use of pledged assets. As of June 30, 2015 and December 31, 2014, the Company had $18.4 billion and $15.2 billion in pledged assets, respectively.

(b) Gross Unrealized Losses

The following is an analysis of how long the AFS securities as of June 30, 2015 and December 31, 2014 had been in a continual unrealized loss position:

	Less than 12 months					Equal to or greater than 12 months
June 30, 2015 (U.S. dollars in thousands)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Fixed maturities and short-term investments - AFS
U.S. Government and Government-Related/Supported	$	1,721,385	$	(12,211	)	$	109,027	$	(4,666	)
Corporate – Financials	1,054,854		(13,737		)	76,450		(6,846		)
Corporate – Non Financials	2,305,696		(41,526		)	146,220		(9,582		)
RMBS – Agency	1,136,559		(12,171		)	245,806		(8,649		)
RMBS – Non-Agency	45,052		(1,959		)	197,361		(15,962		)
CMBS	295,914		(5,263		)	100,100		(3,048		)
CDO	39,969		(5,506		)	322,684		(19,067		)
Other asset-backed securities	1,014,257		(6,535		)	59,985		(5,392		)
U.S. States and political subdivisions of the States	706,360		(10,617		)	17,546		(1,181		)
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	1,736,079		(38,213		)	459,362		(33,833		)
Total fixed maturities and short-term investments - AFS	$	10,056,125	$	(147,738	)	$	1,734,541	$	(108,226	)
Total equity securities	$	267,759	$	(26,787	)	$	—	$	—

32

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

	Less than 12 months					Equal to or greater than 12 months
December 31, 2014 (U.S. dollars in thousands)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Fixed maturities and short-term investments - AFS
U.S. Government and Government-Related/Supported	$	251,091	$	(1,196	)	$	342,890	$	(5,603	)
Corporate – Financials	387,619		(5,858		)	105,155		(7,097		)
Corporate – Non Financials	949,851		(28,023		)	319,066		(8,657		)
RMBS – Agency	134,535		(220		)	512,652		(10,563		)
RMBS – Non-Agency	45,378		(1,358		)	202,700		(16,797		)
CMBS	78,356		(385		)	169,065		(4,877		)
CDO	249,803		(2,666		)	414,516		(24,503		)
Other asset-backed securities	143,044		(2,813		)	57,544		(3,232		)
U.S. States and political subdivisions of the States	32,187		(210		)	63,695		(994		)
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	624,346		(19,043		)	558,422		(43,251		)
Total fixed maturities and short-term investments - AFS	$	2,896,210	$	(61,772	)	$	2,745,705	$	(125,574	)
Total equity securities	$	191,193	$	(26,230	)	$	—	$	—

The Company had gross unrealized losses totaling $282.8 million on 2,944 securities out of a total of 8,969 held as of June 30, 2015 in its AFS - Excluding Life Funds Withheld Assets portfolio, which either it considers to be temporarily impaired or with respect to which it reflects non-credit losses on other-than-temporarily impaired assets. Individual security positions comprising this balance have been evaluated by management to determine the severity of these impairments and whether they should be considered other-than-temporary. Management believes it is more likely than not that the issuer will be able to fund sufficient principal and interest payments to support the current amortized cost.

Management, in its assessment of whether securities in a gross unrealized loss position are temporarily impaired, as described above, considers the significance of the impairments. As of June 30, 2015, the AFS - Excluding Life Funds Withheld Assets portfolio included structured credit securities with gross unrealized losses of $8.8 million, which had a fair value of $6.9 million, and a cumulative fair value decline of greater than 50% of amortized cost. All of these securities are mortgage and asset-backed securities.

(c) Net Realized Gains (Losses)

The following represents an analysis of net realized gains (losses) on investments:

Net Realized Gains (Losses) on Investments	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets:
Gross realized gains	$	48,547		$	118,947		$	110,845		$	170,160
Gross realized losses on investments sold	(27,608		)	(13,487		)	(74,728		)	(41,744		)
OTTI on investments, net of amounts transferred to other comprehensive income	(16,588		)	(24,616		)	(27,164		)	(28,343		)
	$	4,351		$	80,844		$	8,953		$	100,073
Net realized gains (losses) on investments and net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets:
Gross realized gains	$	84,641		$	624		$	137,769		$	624
Gross realized losses on investments sold	(16,604		)	—			(16,994		)	—
OTTI on investments, net of amounts transferred to other comprehensive income	(2,878		)	(8,771		)	(8,087		)	(8,771		)
Net unrealized gains (losses) on trading securities	$	(19,543	)	$	—		$	(18,783	)	$	—
	$	45,616		$	(8,147	)	$	93,905		$	(8,147	)
Total net realized gains (losses) on investments	$	49,967		$	72,697		$	102,858		$	91,926

33

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The significant components of the net impairment charges of $16.6 million for investments excluding Life Funds Withheld Assets for the three months ended June 30, 2015 were:

▪ $6.5 million related to certain Other Investments that we no longer intend to hold for a period sufficient to recover their fair value to amortized cost.

• $4.8 million related to certain high yield securities which we no longer intend to hold for a period sufficient to recover their fair value to amortized cost.

• $4.0 million related to certain Alternatives that were in a loss position for more than 11 months.

• $0.3 million related to certain equities that were in a loss position for more than 11 months.

• $0.2 million for structured securities, principally non-Agency RMBS, where we determined that the likely recovery on these securities was below the carrying value and, accordingly, recorded an impairment of the securities to the discounted value of the cash flows expected to be received on these securities.

• $0.8 million related to foreign exchange losses.

The following table sets forth the amount of credit loss impairments on fixed income securities held by the Company for which a portion of the OTTI loss was recognized in OCI, as of the dates or for the periods indicated and the corresponding changes in such amounts.

Credit Loss Impairments	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Opening balance as of beginning of indicated period	$	108,458		$	171,382		$	131,942		$	174,805
Credit loss impairment recognized in the current period on securities not previously impaired	—			30			7,560			41
Credit loss impairments previously recognized on securities which matured, paid down, prepaid or were sold during the period	(8,495		)	(3,322		)	(37,034		)	(7,571		)
Credit loss impairments previously recognized on securities impaired to fair value during the period	(2,629		)	—			(2,629		)	—
Additional credit loss impairments recognized in the current period on securities previously impaired	246			892			387			3,153
Accretion of credit loss impairments previously recognized due to an increase in cash flows expected to be collected	(3,361		)	(3,105		)	(6,007		)	(4,551		)
Balance as of June 30,	$	94,219		$	165,877		$	94,219		$	165,877

During the three months ended June 30, 2015 and 2014, the $8.5 million and $3.3 million, respectively, of credit loss impairments previously recognized on securities that matured, or were paid down, prepaid or sold, included $1.7 million and $2.5 million, respectively, of non-Agency RMBS.

During the six months ended June 30, 2015 and 2014 , the $37.0 million and $7.6 million, respectively, credit loss impairments previously recognized on securities that matured, or were paid down, prepaid or sold, included $28.9 million and $5.2 million, respectively, of non-Agency RMBS.

7. Derivative Instruments

The Company enters into derivative instruments for both risk management and efficient portfolio management. The Company is exposed to potential loss from various market risks, and manages its market risks based on guidelines established by management and the Risk and Finance Committee of the Company's Board of Directors. The Company recognizes all derivatives as either assets or liabilities on the balance sheets and measures those instruments at fair value, with the changes in fair value of derivatives shown in the consolidated statement of income as "Net realized and unrealized gains (losses) on derivative instruments" unless the derivatives are designated as hedging instruments. The accounting for derivatives that are designated as hedging instruments is described in Item 8, Note 2(h), "Significant Accounting Policies - Derivative Instruments," to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014.

34

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes information on the location and gross amounts of derivative fair values contained in the consolidated balance sheets as of June 30, 2015 and December 31, 2014:

	June 30, 2015								December 31, 2014
(U.S. dollars in thousands)	Asset Derivative Notional Amount		Asset Derivative Fair Value (1)		Liability Derivative Notional Amount		Liability Derivative Fair Value (1)		Asset Derivative Notional Amount		Asset Derivative Fair Value (1)		Liability Derivative Notional Amount		Liability Derivative Fair Value (1)
Derivatives designated as hedging instruments:
Foreign exchange contracts	$	1,834,298	$	209,675	$	720,027	$	52,188	$	2,300,609	$	121,862	$	302,211	$	2,936
Total derivatives designated as hedging instruments	$	1,834,298	$	209,675	$	720,027	$	52,188	$	2,300,609	$	121,862	$	302,211	$	2,936
Derivatives not designated as hedging instruments:
Investment Related Derivatives:
Interest rate exposure	$	10,684	$	194	$	33,934	$	44	$	394,597	$	206	$	20,782	$	51
Foreign exchange exposure	301,260		1,628		139,215		3,786		7,385		403		207,182		4,442
Credit exposure	8,963		814		51,614		12,613		2,408		165		14,270		9,836
Financial market exposure	58,875		2,608		34,794		405		46,145		360		33,670		34
Other Non-Investment Derivatives:
Foreign exchange contracts	79,101		164		8,517		527		—		—		81,194		282
Credit exposure	30,281		71		—		—		31,060		60		—		—
Guaranteed minimum income benefit contract	45,006		13,321		45,006		13,321		46,249		13,603		46,249		13,603
Modified coinsurance funds withheld contracts (2)	65,663		—		4,954,481		—		64,947		—		5,401,278		—
Total derivatives not designated as hedging instruments	$	599,833	$	18,800	$	5,267,561	$	30,696	$	592,791	$	14,797	$	5,804,625	$	28,248

____________

(1) Derivative instruments in an asset or liability position are included within Other assets or Other liabilities, respectively, in the balance sheets on a net basis where the Company has both a legal right of offset and the intention to settle the contracts on a net basis.

(2) The fair value movements in derivative assets and liabilities relating to modified coinsurance funds withheld contracts are included within the associated asset or liability at each period end on the face of the balance sheets. Notional amounts associated with reinsurance agreements under which the Company assumes reinsurance risk are recorded as asset derivative notional amounts. Notional amounts associated with the Life Retro Arrangements under which the Company cedes reinsurance risk are recorded as liability derivative notional amounts. Included in the liability derivative notional amount as of June 30, 2015 is the cumulative net realized and unrealized loss on life retrocession embedded derivative of $381.3 million.

The following table summarizes information on the gross and net amounts of derivative fair values and associated collateral received related to derivative assets, or collateral provided related to derivative liabilities, reported in other assets and or other liabilities within our consolidated balance sheets as of June 30, 2015 and December 31, 2014:

							Gross Amounts Not Offset in the Balance Sheets
June 30, 2015 (U.S. dollars in thousands)	Gross Amounts Recognized in the Balance Sheets		Gross Amounts Offset in the Balance Sheets		Net Amounts in the Balance Sheets		Financial Instruments		Cash Collateral		Net Amounts
Derivative Assets	$	228,475	$	3,239	$	225,236	$	—	$	132,050	$	93,186
Derivative Liabilities	$	82,884	$	3,239	$	79,645	$	—	$	—	$	79,645
December 31, 2014 (U.S. dollars in thousands)
Derivative Assets	$	136,659	$	696	$	135,963	$	—	$	78,580	$	57,383
Derivative Liabilities	$	31,184	$	696	$	30,488	$	—	$	—	$	30,488

Derivative instruments in an asset or liability position are included within Other assets or Other liabilities, respectively, in the balance sheets on a net basis where the Company has both a legal right of offset and the intention to settle the contracts on a net basis. The Company often enters into different types of derivative contracts with a single counterparty and these contracts

35

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

are covered under netting agreements. As of June 30, 2015 and December 31, 2014, the Company held cash collateral related to foreign currency derivative positions and certain other derivative positions of $132.1 million and $78.6 million, respectively. The assets and liabilities related to the net collateral paid or held were recorded as Other assets and Other liabilities within the balance sheets as the collateral and derivative positions are not intended to be settled on a net basis.

(a) Derivative Instruments Designated as Fair Value Hedges

The Company designates certain of its derivative instruments as fair value hedges or cash flow hedges and formally and contemporaneously documents all relationships between the hedging instruments and hedged items and links the hedging derivatives to specific assets and liabilities. The Company assesses the effectiveness of the hedge both at inception and on an on-going basis, and determines whether the hedge is highly effective in offsetting changes in fair value or cash flows of the linked hedged item.

The Company may use foreign exchange contracts to hedge the fair value of certain fixed income securities as well as to hedge certain net investments in foreign operations. In connection with the Catlin Acquisition and the FX Forwards, certain foreign exchange contracts utilized to hedge the fair value of certain net investments in foreign operations were de-designated as hedging instruments up until such time Catlin Acquisition was completed. Thereafter, these foreign exchange contracts were re-designated as hedging instruments.

The following table provides the total impact on earnings relating to derivative instruments formally designated as fair value hedges along with the impacts of the related hedged items for the three and six months ended June 30, 2015 and 2014:

				Hedged Items - Amount of Gain/(Loss) Recognized in Income Attributable to Risk
Derivatives Designated as Fair Value Hedges: Three Months Ended June 30, 2015 (U.S. dollars in thousands)	Gain/(Loss) Recognized in Income on Derivative				Fixed Maturity Investments		Ineffective Portion of Hedging Relationship - Gain/(Loss)
Interest rate exposure	$	—
Foreign exchange exposure	—
Total	$	—			$	—	$	—
Three Months Ended June 30, 2014
(U.S. dollars in thousands)
Interest rate exposure	$	—
Foreign exchange exposure	(9,132		)
Total	$	(9,132	)		$	7,082	$	(2,050	)
Six Months Ended June 30, 2015
(U.S. dollars in thousands)
Interest rate exposure	$	—
Foreign exchange exposure	—
Total	$	—			$	—	$	—
Six Months Ended June 30, 2014
(U.S. dollars in thousands)
Interest rate exposure	$	—
Foreign exchange exposure	(15,663		)
Total	$	(15,663	)		$	15,407	$	(256	)

The gains (losses) recorded on both the derivative instruments and specific items designated as being hedged as part of the fair value hedging relationships outlined above along with any associated ineffectiveness in the relationships are recorded through Net realized and unrealized gains (losses) on derivative instruments in the income statement.

36

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Settlement of Fair Value Hedges

A summary of the fair value hedges that have been settled and their impact on results during the indicated periods as well as the remaining balance of fair value hedges and average years remaining to maturity as of June 30, 2015 and 2014 are shown below:

Settlement of Fair Value Hedges - Summary	Fair Value Hedges - Notes Payable and Debt June 30,				Fair Value Hedges - Deposit Liabilities June 30,
(U.S. dollars in thousands, except years)	2015		2014		2015		2014
Cumulative reduction to interest expense	$	—	$	20,810	$	99,141	$	90,615
Remaining balance	$	—	$	814	$	134,054	$	142,580
Weighted average years remaining to maturity	0.0		0.2		22.4		24.0

During the second quarter of 2014, the Company negotiated the termination of one of its larger structured indemnity contracts. This contract had previously been designated as a fair value hedge that was settled. The remaining fair value adjustment of $47.0 million that was being amortized as a reduction of interest expense over the remaining term of the contract was recorded as an adjustment to interest expense at the termination date. As a result of the termination, a net decrease of $28.7 million was recorded to interest expense reflecting the realization of the remaining balance of the fair value hedge adjustment, partially offset by an accretion rate adjustment due to changes in cash flows.

(b) Derivative Instruments Designated as Hedges of the Net Investment in a Foreign Operation

The Company utilizes foreign exchange contracts to hedge the fair value of certain net investments in foreign operations. During the three and six months ended June 30, 2015 and 2014, the Company entered into foreign exchange contracts that were formally designated as hedges of investments in foreign subsidiaries, the majority of which have functional currencies of either U.K. sterling or the Euro. There was no ineffectiveness in these transactions.

The following table provides the weighted average U.S. dollar equivalent of foreign denominated net assets that were hedged and the resulting derivative gain (loss) that was recorded in the Foreign currency translation adjustment, net of tax, account within AOCI for the three and six months ended June 30, 2015 and 2014:

Derivative Instruments Designated as Hedges of the Net Investment in a Foreign Operation - Summary	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015		2014
Weighted average of U.S. dollar equivalent of foreign denominated net assets	$	1,815,593		$	2,270,090		$	1,222,267	$	2,478,772
Derivative gains (losses) (1)	$	(30,498	)	$	(2,170	)	$	36,272	$	(1,210	)

____________

(1) Derivative gains (losses) from derivative instruments designated as hedges of the net investment in a foreign operation are recorded in the cumulative translation adjustment account within AOCI for each period.    

37

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(c) Derivative Instruments Not Formally Designated As Hedging Instruments

The following table provides the total impact on earnings relating to derivative instruments not formally designated as hedging instruments under authoritative accounting guidance and from the ineffective portion of fair value hedges. The impacts are all recorded through Net realized and unrealized gains (losses) on derivatives in the income statement for the three and six months ended June 30, 2015 and 2014:

Net Realized and Unrealized Gains (Losses) on Derivative Instruments	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Investment Related Derivatives:
Interest rate exposure	$	(6,563	)	$	8,978		$	3,073		$	9,326
Foreign exchange exposure	482			(1,490		)	(880		)	1,798
Credit exposure	(386		)	411			(305		)	7
Financial market exposure	(1,645		)	2,508			1,398			3,378
Financial Operations Derivatives:
Credit exposure	—			447			—			(4,353		)
Other Non-Investment Derivatives:
Foreign exchange contracts	55,372			—			57,431			—
Credit exposure	132			—			1,478			—
Guaranteed minimum income benefit contract	—			633			—			2,257
Modified coinsurance funds withheld contract	1,117			2,162			2,835			1,252
Total gain (loss) recognized in income from derivatives not designated as hedging instruments	$	48,509		$	13,649		$	65,030		$	13,665
Amount of gain (loss) recognized in income from ineffective portion of fair value hedges	—			(2,050		)	—			(256		)
Net realized and unrealized gains (losses) on derivative instruments	$	48,509		$	11,599		$	65,030		$	13,409
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	$	239,174		$	(17,546	)	$	9,807		$	(17,546	)

The Company’s objectives in using these derivatives are explained below.

(d)(i) Investment Related Derivatives

The Company, either directly or through its investment managers, may use derivative instruments within its investment portfolio, including interest rate swaps, inflation swaps, commodity contracts, total return swaps, credit derivatives (single name and index credit default swaps), options, forward contracts and financial futures (foreign exchange, bond and stock index futures), primarily as a means of economically hedging exposures to interest rate, credit spread, equity price changes and foreign currency risk or, in limited instances, for efficient portfolio management. When using cleared (exchange traded) derivatives, the Company is exposed to the credit risk of the applicable clearing house and of the Company's future commissions merchant. When using uncleared (over-the-counter) derivatives, the Company is exposed to credit risk in the event of non-performance by the counterparties under any derivative contracts, although the Company generally seeks to use credit support arrangements with counterparties to help manage this risk.

Investment Related Derivatives – Interest Rate Exposure

The Company utilizes risk management and overlay strategies that incorporate the use of derivative financial instruments, primarily to manage its fixed income portfolio duration and net economic exposure to interest rate risks. The Company may also use interest rate swaps to convert certain liabilities from a fixed rate to a variable rate of interest or to convert a variable rate of interest from one basis to another.

Investment Related Derivatives – Foreign Exchange Exposure

The Company has exposure to foreign currency exchange rate fluctuations through its operations and in its investment portfolio. The Company uses foreign exchange contracts to manage its exposure to the effects of fluctuating foreign currencies on the value of certain of its foreign currency fixed maturities. These contracts are not designated as specific hedges for financial reporting purposes and, therefore, realized and unrealized gains and losses on these contracts are recorded in income in the period in which they occur. These contracts generally have maturities of twelve months or less.

In addition, certain of the Company's investment managers may, subject to investment guidelines, enter into forward contracts.

38

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Investment Related Derivatives – Credit Exposure

Credit derivatives may be purchased within the Company's investment portfolio in the form of single name, basket or index credit default swaps and swaptions, which are used to mitigate credit exposure through a reduction in credit spread duration (i.e., macro credit strategies rather than single-name credit hedging) or exposure to securities of selected issuers, including issuers that are not held in the underlying fixed income portfolio.

Investment Related Derivatives – Financial Market Exposure

Stock index futures may be purchased within the Company's investment portfolio in order to create synthetic equity exposure and to add value to the portfolio with overlay strategies where market inefficiencies are believed to exist. From time to time, the Company may enter into other financial market exposure derivative contracts on various indices including, but not limited to, inflation and commodity contracts.

(d)(ii) Financial Operations Derivatives – Credit Exposure

During the fourth quarter of 2014, the remaining financial operations credit derivative exposure, which was written as part of the Company's previous financial lines business and is outside of the Company's investment portfolio, was terminated. The Company has no continuing financial operations derivative credit exposures.

(d)(iii) Other Non-Investment Derivatives

Foreign Exchange Contracts

On January 9, 2015, the Company entered into the FX Forwards with Morgan Stanley Capital Services LLC and Goldman Sachs International. The purpose of the FX Forwards was to mitigate risk of foreign currency exposure related to the Catlin Acquisition. Following the close of the Catlin Acquisition, the FX Forwards were settled.

In connection with the Catlin Acquisition and the FX Forwards, during the quarter, certain foreign exchange contracts utilized to hedge the fair value of certain net investments in foreign operations were de-designated as hedging instruments.

Credit Exposure

During the year ended December 31, 2014, the Company entered into a non-investment related credit derivative relating to a number of reference pool mortgage tranches associated with actual mortgage loans that were securitized into agency mortgage-backed securities and sold as Structured Agency Credit Risk Notes. As of June 30, 2015, there was no reported event of default on this obligation. As of June 30, 2015 and December 31, 2014, the notional amount outstanding related to the derivative was $30.3 million and $31.1 million, respectively, and the Company had recorded a derivative asset of $0.1 million and $0.1 million, respectively. During the three months ended June 30, 2015, the Company recorded Net realized and unrealized gains of $0.1 million relating to this credit derivative. The credit derivative is recorded at fair value based upon models developed by the Company. Significant unobservable inputs considered in the valuation include the impact of changes in interest rates, future default, delinquency and prepayment rates, credit spreads, changes in credit quality, and other market factors.

Guaranteed Minimum Income Benefit Contract

The Company also has derivatives embedded in certain reinsurance contracts. For a certain life reinsurance contract, the Company pays the ceding company a fixed amount equal to the estimated present value of the excess of the guaranteed benefit over the account balance upon the policyholder's election to take the income benefit. The fair value of this derivative is determined based on the present value of expected cash flows.

Modified Coinsurance and Funds Withheld Contracts

The Company has modified coinsurance and funds withheld reinsurance agreements that provide for a return to be paid to the Company based on a portfolio of fixed income securities. As such, the agreements contain an embedded derivative. The embedded derivative is bifurcated from the funds withheld balance and recorded at fair value with changes in fair value recognized in earnings through Net realized and unrealized gains (losses) on derivative instruments.

Modified Coinsurance Funds Withheld Reinsurance Agreements - Life Retrocession Embedded Derivative

In addition, the Company has entered into Life Retro Arrangements, as described in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary." The embedded derivative related to the Life Retro Arrangements is recorded at fair value with changes in fair value recognized in earnings through Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets.

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XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The change in the value of the life retrocession embedded derivative includes the interest income, realized and unrealized gains and losses on Life Funds Withheld Assets and certain related expenses subsequent to May 30, 2014 as follows:

Components of Life Retrocession Embedded Derivative and Derivative Instruments - Life Funds Withheld Assets:	Three months ended June 30,						Six Months Ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Interest income - Life Funds Withheld Assets	$	(47,873	)	(19,944		)	(98,869		)	(19,944		)
Realized and unrealized gains (losses) - Life Funds Withheld Assets	321,038			1,893			168,208			1,893
Other	59			505			155			505
Net realized and unrealized gains (losses) on life retrocession embedded derivative	$	273,224		$	(17,546	)	$	69,494		$	(17,546	)
Net adjustments related to future policy benefit reserves, net of tax	$	(35,929	)	$	—		$	(47,883	)	$	—
Net realized and unrealized gains (losses) on derivative instruments - Life Funds Withheld Assets	$	1,879		$	—		$	(11,804	)	$	—
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	$	239,174		$	(17,546	)	$	9,807		$	(17,546	)

(e) Contingent Credit Features

Certain derivative agreements entered into by the Company or its subsidiaries contain credit rating downgrade provisions that permit early termination of the agreements by the counterparty if collateral is not posted following failure to maintain certain credit ratings from one or more of the principal credit rating agencies. If the Company were required to terminate such agreements early due to a credit rating downgrade, it could potentially be in a net liability position at the time of settlement of such agreements. The aggregate fair value of all derivative agreements containing such rating downgrade provisions that were in a liability position and any collateral posted under these agreements as of June 30, 2015 and December 31, 2014 were as follows:

Contingent Credit Features - Summary: (U.S. dollars in thousands)	June 30, 2015		December 31, 2014
Aggregate fair value of derivative agreements with downgrade provisions in a net liability position	$	21,545	$	5,770
Collateral posted to counterparty	$	12,390	$	—

8. Goodwill and Other Intangible Assets

The Company has goodwill and intangible assets of $2.2 billion and $448.0 million at June 30, 2015 and December 31, 2014, respectively.

In the second quarter of 2015, as a result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition," the Company recognized additional intangible assets. The transaction was accounted for using the acquisition method under which the Company recorded the identifiable assets acquired, including indefinite-lived and definite-lived intangible assets, and liabilities assumed, at their acquisition fair values, and recorded the excess of consideration transferred over the net assets acquired as goodwill.

During the first quarter of 2014, goodwill and intangible assets increased as a result of the completion of an acquisition. The transaction was accounted for using the acquisition method under which the Company recorded the identifiable assets acquired - including definite-lived intangible assets, and liabilities assumed, at their acquisition date fair values, and recorded the excess of consideration transferred over the net assets acquired as goodwill.

The following table presents an analysis of intangible assets broken down between goodwill, intangible assets with an indefinite life and intangible assets with a definite life for the six months ended June 30, 2015:

(U.S. dollars in thousands)	Goodwill			Intangible assets with an indefinite life		Intangible assets with a definite life			Total
Balance at December 31, 2014	$	415,936		$	15,366	$	16,650		$	447,952
Additions	778,043			673,000		315,000			1,766,043
Amortization	—			—		(4,335		)	(4,335		)
Foreign Currency Translation	(3,749		)	—		—			(3,749		)
Balance at June 30, 2015	$	1,190,230		$	688,366	$	327,315		$	2,205,911

40

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes the intangible assets and their related useful lives recorded in connection with the Catlin Acquisition as of the Acquisition Date:

(U.S. dollars in thousands)	Amount		Estimated Useful Life
Lloyd's - Syndicate capacity	$	660,000	Indefinite
Insurance licenses	13,000		Indefinite
Total identified indefinite life intangible assets	$	673,000
Lloyd's - Managing agent contracts	15,000		15 years
Distribution network	290,000		20 years
Trademarks / Trade names	10,000		2 years
Total identified definite life intangible assets	$	315,000
Total identified intangible assets	$	988,000

An explanation of the intangible assets is as follows:

• Lloyd's - Syndicate capacity - The syndicate capacity of two Lloyd's syndicates, which will allow the Company to write insurance business in the Lloyd's market globally and realize the profits from that business. The value of the syndicate capacity includes the reputational value of participation in the Lloyd's market, and the value of trade names and licenses associated with syndicate ownership.

• Insurance licenses - U.S. State insurance licenses owned by Catlin at the time of Catlin Acquisition.

• Lloyds - Managing agent contracts - As the managing agent for certain Lloyd's syndicates, the Company has contracts with the syndicate members to provide underwriting services, for which it earns managing agent fees and a profit commission.

• Distribution network - A network of hundreds of retail and wholesale brokers worldwide, including specialty and regional brokerages, which allow the Company to form closer relationships with clients and brokers worldwide, which aids business retention.

• Trademarks / Trade names - The Catlin trademarks / trade names are utilized to attract customers for the turnkey solutions provided under the Company's managing agent contracts, and to generate premium from the non-Lloyd's platform underwriting products for which the Catlin brand is known.

9. Share Capital

(a) Authorized and Issued

Ordinary Shares

In connection with the Catlin Acquisition described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition," the Company issued 49.9 million ordinary shares to Catlin shareholders, which had an aggregate value as of the Acquisition Date of $1.85 billion.

The following table is a summary of ordinary shares issued and outstanding:

(in thousands)	June 30, 2015		December 31, 2014
Balance – beginning of period	255,183		278,253
Exercise of options	220		424
Net issuance of restricted shares	1,536		1,246
Share buybacks (1)	(2,982	)	(24,740	)
Issue of shares	49,935		—
Balance – end of period	303,892		255,183

____________

(1) Includes share buybacks associated with authorized share buyback programs as well as purchases related to satisfying tax withholding obligations of employees in connection with the vesting of restricted shares granted under the Company's equity compensation programs.

Buybacks of Ordinary Shares

On February 21, 2014, XL-Ireland announced that its Board of Directors approved an increase to the Share Buyback Program, authorizing the purchase of up to $1.0 billion of ordinary shares, which included the amounts that remained under the

41

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

previous Share Buyback Program. The Company had suspended active share buybacks through the close of the Catlin Acquisition; however, following the close of the Catlin Acquisition, the Company resumed buybacks under the Share Buyback Program. During the three and six months endedJune 30, 2015, the Company purchased and canceled 2.9 million ordinary shares under the Share Buyback Program for $110.0 million. As of June 30, 2015, $157.6 million remained available for purchase under the Share Buyback Program.

Acquisition of Non-controlling Preferred Shares

In connection with the Catlin Acquisition described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition," the Company assumed responsibility for 0.6 million non-cumulative perpetual preferred shares issued by Catlin-Bermuda, par value of $0.01 per share, with liquidation preference of $1,000 per share, plus declared and unpaid dividends ("CICL Prefs"). Dividends at a rate of 7.249 percent on the liquidation preference are payable semi-annually on January 19 and July 19 in arrears as and when declared up to but not including January 2017. Thereafter, if the CICL-Prefs have not yet been redeemed, dividends will be payable quarterly at a rate equal to 2.975 percent plus the three-month LIBOR rate of the liquidation preference. The fair value on the date of Catlin Acquisition was $562.3 million, which was based on the last trade price of the security prior to the Catlin Acquisition.

(b) Stock Plans

The Company's performance incentive programs provide for grants of stock options, restricted stock, equity-classed restricted stock units, liability-classed restricted stock units, performance units and stock appreciation rights. Share-based compensation granted by the Company generally contains a vesting period of three or four years, and certain awards also contain performance conditions. The Company records compensation expense related to each award over its vesting period, incorporating the best estimate of the expected outcome of performance conditions where applicable. Compensation expense is generally recorded on a straight line basis over the vesting period of an award. See Item 8, Note 20, "Share Capital," to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014 for further information on the Company's performance incentive programs and associated accounting.

During the six months ended June 30, 2015, the Company granted approximately 2.0 million stock options with a weighted-average grant date fair value of $6.51 per option. The fair value of the options issued was estimated on the date of grant using the Black-Scholes option pricing model using the following weighted average assumptions:

Dividend yield	2.00	%
Risk free interest rate	1.70	%
Volatility	21.6	%
Expected lives	6.0 years

During the six months ended June 30, 2015, the Company granted approximately 40,570 restricted stock awards to certain employees and directors of the Company and its subsidiaries with an aggregate grant date fair value of approximately $1.5 million. The award recipients generally have the rights and privileges of a shareholder as to the restricted stock, including the right to receive dividends contingent upon the vesting of the restricted stock and the right to vote such restricted stock. The recipients are not entitled to receive delivery of a stock certificate prior to vesting nor may any restricted stock be sold, transferred, pledged, or otherwise disposed of prior to the satisfaction of all vesting requirements.

During the six months ended June 30, 2015, the Company granted approximately 1.5 million equity-classed restricted stock units to certain employees of the Company and its subsidiaries with an aggregate grant date fair value of approximately $55.4 million. Each equity-classed restricted stock unit represents the Company's obligation to deliver to the holder one ordinary share, and grants vest in three equal installments upon the first, second and third anniversaries of the date of grant. Equity-classed restricted stock units are granted at the closing market price on the day of grant and entitle the holder to receive dividends declared and paid in the form of additional ordinary shares contingent upon vesting.

During the six months ended June 30, 2015, the Company granted approximately 2.5 million liability-classed stock units to certain employees of the Company and its subsidiaries with an aggregate grant date fair value of approximately $93.4 million. Each liability-classed restricted stock unit represents the Company's obligation to deliver to the holder a cash payment equivalent to the value of one ordinary share. The grants may vest either in three equal installments upon the first, second and third anniversaries of the date of grant; or in two equal installments upon the first and second anniversaries of the date of grant. Liability-classed restricted stock units are granted at the closing market price on the day of grant and entitle the holder to receive dividends declared and are paid in cash contingent upon vesting.

During the six months ended June 30, 2015, the Company granted approximately 0.8 million performance units (representing a potential maximum share payout of approximately 1.6 million ordinary shares) to certain employees with an aggregate grant date fair value of approximately $28.2 million. The performance units issued in 2015 vest after three years,

42

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

subject to the achievement of stated market metrics, and entitle the holder to ordinary shares of the Company. Performance units issued prior to 2015 vest subject to the achievement of stated performance metrics. Each grant of performance units has a target number of shares, with final payouts ranging from 0% to 200% of the grant amount depending upon the achievement of stated market metrics along with each employee's continued service through the vesting date. Performance units issued prior to 2015 have a similar range of targeted number of shares, but payouts are dependent upon the achievement of stated performance metrics along with each employee's continued service through the vesting date. Furthermore, performance units granted in the current year are granted at the closing market price on the day of grant and entitle the holder to receive dividends declared and paid in the form of additional ordinary shares contingent upon vesting. There are no dividend rights associated with performance units issued prior to 2015. Performance targets are based on relative and absolute financial performance metrics.

10. Notes Payable and Debt and Financing Arrangements

As of June 30, 2015, the Company's financing structure, which includes senior and subordinated notes, and bank and loan facilities available from a variety of sources, including commercial banks, is as follows:

(U.S. dollars in thousands)	June 30, 2015				December 31, 2014
	Commitment/ Debt (1)		In Use/ Outstanding (2)		Commitment/ Debt (1)		In Use/ Outstanding (2)
Debt:
2.30% Senior Notes due 2018	300,000		297,679		300,000		297,344
5.75% Senior Notes due 2021	400,000		397,307		400,000		397,092
6.375% Senior Notes due 2024	350,000		348,975		350,000		348,920
4.45% Subordinated Notes due 2025	500,000		492,292		—		—
6.25% Senior Notes due 2027	325,000		323,140		325,000		323,062
Variable Rate Note, face amount €7m, due 2035	7,794		7,301		—		—
Variable Rate Note, face amount $27m, due 2036	27,000		25,259		—		—
Variable Rate Note, face amount $31m, due 2036	31,300		29,281		—		—
Variable Rate Note, face amount $10m, due 2036	9,800		9,168		—		—
Variable Rate Note, face amount €11m, due 2036	12,248		11,473		—		—
5.25% Senior Notes due 2043	300,000		296,228		300,000		296,162
5.5% Subordinated Notes due 2045	500,000		488,352		—		—
Total debt carrying value	$	2,763,142	$	2,726,455	$	1,675,000	$	1,662,580

_______________

(1) Excluded from the table are revolving credit facilities of $1.7 billion and $1.6 billion as of June 30, 2015 and December 31, 2014, respectively. As of June 30, 2015 and December 31, 2014, $667.9 million and $606.1 million, respectively, were utilized under these facilities to issue letters of credit, leaving $1.0 billion and $968.9 million, respectively, available for use under the revolving credit facilities.

(2)    "In Use" and "Outstanding" data represent June 30, 2015 and December 31, 2014 accreted values.

(a) Notes Payable and Debt

With the exception of the debt acquired as part of the Catlin Acquisition, as described below, all outstanding debt of the Company as of June 30, 2015 and December 31, 2014 was issued by XL-Cayman, a 100% owned subsidiary of XL-Ireland. XL-Ireland does not have significant assets or operations independent of XL-Cayman. XL-Cayman's outstanding debt is fully and unconditionally guaranteed by XL-Ireland. The ability of XL-Cayman, like that of the Company, to obtain funds from its subsidiaries to satisfy any of its obligations, including under guarantees, is subject to certain contractual restrictions, applicable laws and statutory requirements of the various countries in which the subsidiaries operate, including, among others, Bermuda, the United States, Ireland, Switzerland and the United Kingdom. For details of the required statutory capital and surplus for the principal operating subsidiaries of the Company, see Item 8, Note 25, "Statutory Financial Data," to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014.

On March 30, 2015, XL-Cayman issued $500 million of subordinated notes due March 2025, with a fixed coupon of 4.45%, that are guaranteed by XL-Ireland. The notes are listed on the New York Stock Exchange. The notes were issued at 99.633% of the face amount and net proceeds were $492.2 million. Related expenses of the offering amounted to approximately $5.9 million. These costs were deferred and will be amortized over the term of the subordinated notes.

On March 30, 2015, XL-Cayman issued $500 million of subordinated notes due March 2045, with a fixed coupon of 5.5%, that are guaranteed by XL-Ireland. The notes are listed on the New York Stock Exchange. The notes were issued at 99.115% of the face amount and net proceeds were $488.4 million. Related expenses of the offering amounted to approximately $7.2 million. These costs were deferred and will be amortized over the term of the subordinated notes.

43

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

As a result of the Catlin Acquisition, the Company has assumed the following liabilities of Catlin:

• Variable rate unsecured subordinated notes in the amounts of €7 million and $27 million due March 2035 and March 2036, respectively, issued by Catlin Underwriting (formerly Wellington Underwriting plc), in May 2006. The notes are subordinated to the claims of all senior creditors, as defined in the agreement governing the notes. The notes pay interest at a floating rate based on the rate on three-month deposits in U.S. dollars plus a margin of 295 basis points and 317 basis points, respectively. Interest is payable quarterly in arrears. The notes are redeemable at the discretion of the issuer.

• Variable rate unsecured subordinated notes in the amounts of $31 million, $10 million and €11 million due September 2036, issued by Catlin Underwriting, in July 2006. The notes are subordinated to the claims of all senior creditors, as defined in the agreement governing the notes. The notes pay interest at a floating rate based on the rate on three-month deposits in U.S. dollars plus a margin of 310 basis points, 300 basis points and 300 basis points, respectively. Interest is payable quarterly in arrears. The notes are redeemable at the discretion of the issuer.

XL-Cayman and the Company were in compliance with all covenants by significant margins as of June 30, 2015, and XL-Cayman and the Company currently remain in compliance with all covenants.

(b) Letter of Credit Facilities and Other Sources of Collateral

The Company has letter of credit facilities provided on both syndicated and bilateral bases from commercial banks. These facilities are utilized primarily to support non-admitted insurance and reinsurance operations in the U.S. and capital requirements at Lloyd’s.

The Company’s letter of credit facilities and revolving credit facilities as of June 30, 2015 and December 31, 2014 were as follows:

Letter of Credit Summary: (U.S. dollars in thousands except percentages)	June 30, 2015 (1)			December 31, 2014 (1)
Revolving credit facilities (2) (3)	$	1,032,100		$	968,900
Available letter of credit facilities - commitments (4)	$	4,855,000		$	3,575,000
Available letter of credit facilities - in use	$	2,585,348		$	1,790,561
Collateralized by certain assets of the Company’s investment portfolio	50.2		%	66.2		%

____________

(1) As of June 30, 2015 and December 31, 2014, there were eighteen and eight available letter of credit facilities, respectively.

(2) As of June 30, 2015 and December 31, 2014, $976.1 million and $968.9 million, respectively, of revolving credit was available under the Company's syndicated unsecured credit agreement, which currently provides for up to $1 billion of revolving credit loans. The Company has the option to increase the size of the facilities under the syndicated secured and unsecured credit agreements by an additional $500 million across both facilities. Two bilateral facilities assumed as a result of the Catlin Acquisition with commitments totaling $150.0 million also provide for revolving credit loans. As of June 30, 2015, $56.0 million of revolving credit was available to draw under these facilities.

(3) The credit agreements initially entered into with Citicorp USA, Inc. in May through November 2013 (the "Citi Agreements") provide for issuance of letters of credit and revolving credit loans up to an aggregate amount of $550.0 million, compared to $575.0 million as of December 31, 2014. As of June 30, 2015, $550.0 million of letters of credit were issued under these agreements, and therefore no amounts are included in this line as available to draw under this facility. The Company also has the option to increase the maximum amount of the letters of credit and revolving credit loans available under the Citi Agreements with the lender's and issuing lender's consent.

(4) The available letter of credit facilities include approximately $1 billion that is also included in the "revolving credit facilities" line in this table.

As a result of the Catlin Acquisition, the Company has assumed the following credit facilities:

• A $450 million unsecured multi-bank facility available for utilization by certain subsidiaries and guaranteed by Green Holdings. The facility has a termination date of December 31, 2016.

• A bilateral facility available for utilization by Catlin-Bermuda, collateralized by pledged financial assets. As of June 30, 2015, $147 million of letters of credit were issued under this facility.

• A bilateral facility available for utilization by Catlin Re Switzerland Ltd, collateralized by pledged financial assets. As of June 30, 2015, $49 million of letters of credit were issued under this facility.

• Four unsecured bilateral facilities available for utilization by Catlin-Bermuda and guaranteed by Green Holdings for Funds at Lloyd's purposes, amounting to a total of $375 million. One of the facilities has an expiration date of December 31, 2017, while the other three have expiration dates of December 31, 2018.

• An unsecured bilateral facility valued in Australian dollars at A$50 million, available for utilization by certain subsidiaries of Catlin and guaranteed by Green Holdings, for the purpose of providing collateral to Australian beneficiaries.

44

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

• Two unsecured bilateral revolving credit and letter of credit facilities, available for utilization by certain subsidiaries of Catlin and guaranteed by Green Holdings amounting to $150 million.

• A facility managed by Lloyd's, acting for Catlin Syndicate 2003. As of June 30, 2015, $8 million of letters of credit were issued under this facility.

• Catlin, Inc. has letters of credit amounting to $1 million issued for the benefit of various parties.

For details regarding these facilities see Item 8, Note 15(b), "Notes Payable and Debt and Financing Arrangements - Letter of Credit Facilities and Other Sources of Collateral," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

11. Related Party Transactions

As of June 30, 2015 and 2014, the Company owned minority stakes in six and five independent investment management companies ("Investment Manager Affiliates"), respectively, that are actively managing client capital and seeking growth opportunities, respectively. The Company seeks to develop relationships with specialty investment management organizations, generally acquiring an equity interest in the business. The Company also invests in certain of the funds and limited partnerships and other legal entities managed by these affiliates, and, through these funds and partnerships, pays management and performance fees to the Company's Investment Manager Affiliates. See Item 8, Note 7, "Investments in Affiliates," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

In the normal course of business, the Company enters into assumed reinsurance contracts with certain of its other strategic affiliates, or their subsidiaries. Management believes that these transactions are conducted at market rates consistent with negotiated arm's-length contracts. During the three and six months ended June 30, 2015 and 2014, these contracts resulted in net premiums written, net claims incurred and acquisition costs as summarized below.

(U.S. dollars in thousands)	Three months ended June 30,				Six months ended June 30,
	2015		2014		2015		2014
Net premiums written	$	4,445	$	18,025	$	31,521	$	36,191
Net losses and loss expenses incurred	$	65	$	7,692	$	9,166	$	14,301
Acquisition costs	$	1,384	$	6,994	$	10,395	$	15,553

Results through April 1, 2015 include amounts under an assumed reinsurance contract with a wholly-owned subsidiary of ARX, an insurance operating affiliate of the Company to that date. The Company disposed of its investment in ARX on April 1, 2015, and thus, after that date, all amounts under this contract are no longer reported as related party transactions. See Note 3(b), "Acquisitions and Disposals - Sale of Strategic Operating Affiliate".

Commencing in 2014, several of the Company’s wholly-owned subsidiaries retrocede assumed reinsurance business to special purpose reinsurers that receive capital from funds managed by the Company's subsidiary, New Ocean Capital Management Limited, a Bermuda based company, ("New Ocean"), as discussed in Note 12, "Variable Interest Entities". Underwriting administration services are provided to the special purpose reinsurers by other subsidiaries of the Company under service fee agreements negotiated at arm's-length, while investment advisory services are provided by New Ocean.

During the three and six months endedJune 30, 2015, ceded premiums earned, ceded losses and loss expenses incurred, ceding commission income, and other fee income related to these retrocessional contracts were not material to the Company. Management believes that these transactions are conducted at market rates consistent with negotiated arm's-length contracts.

12. Variable Interest Entities

At times, the Company has utilized variable interest entities ("VIEs") both indirectly and directly in the ordinary course of the Company's business.

The Company invests in CDOs and other investment vehicles that are issued through VIEs as part of the Company's investment portfolio. The activities of these VIEs are generally limited to holding the underlying collateral used to service investments therein. The Company's involvement in these entities is passive in nature and we are not the arranger of these entities. In addition, the Company has not been involved in establishing these entities.

The Company has a limited number of remaining outstanding credit enhancement exposures, including written financial guarantee and credit default swap contracts. The obligations related to these transactions are often securitized through VIEs. The Company is not the primary beneficiary of these VIEs as contemplated in current authoritative accounting guidance on the basis that management does not believe that the Company has the power to direct the activities, such as asset selection and

45

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

collateral management, which most significantly impact each entity's economic performance. For further details on the nature of the obligations and the size of the Company's maximum exposure, see Note 7, "Derivative Instruments," and Note 14(a), "Commitments and Contingencies - Financial Guarantee Exposures."

During the third quarter of 2013, the Company, along with other investors, formed New Ocean to act as an investment manager focused on providing third-party investors access to insurance-linked securities and other insurance and reinsurance capital markets products. The Company holds a majority voting interest in New Ocean through its ownership of common shares and, accordingly, the financial statements of New Ocean have been included in the consolidated financial statements of the Company. None of the assets, liabilities, revenues or net income of New Ocean was material to the Company during the three and six months endedJune 30, 2015. The equity interest attributable to third party investors in New Ocean recorded in the Company’s Unaudited Consolidated Balance Sheets as "Non-controlling interest in equity of consolidated subsidiaries" was $0.2 million and $0.2 million as of June 30, 2015 and December 31, 2014, respectively.

During the fourth quarter of 2013, the Company, along with other investors, invested in a new Bermuda-based company, New Ocean Focus Cat Fund Ltd. ("New Ocean FCFL"), which is considered a VIE under GAAP. During the second quarter of 2014, the Company formed another new Bermuda-based investment company, New Ocean Market Value Cat Fund, Ltd. ("New Ocean MVCFL"), which is also considered a VIE under GAAP. New Ocean MVCFL primarily invests in insurance-linked securities, with a current focus on catastrophe bonds.

During the year ended December 31, 2014, New Ocean FCFL invested in a special purpose Bermuda reinsurer, Vector Reinsurance Ltd ("Vector Re"), formed for the purpose of underwriting collateralized excess of loss reinsurance with a focus on global property catastrophe risks. During the first quarter of 2015, New Ocean MVCFL also invested in Vector Re. Most of Vector Re’s current underwriting activity relates to reinsurance business assumed from the Company's subsidiaries. Underwriting administration and claims services are provided to Vector Re by the Company under service fee contracts which management believes were negotiated at arm's-length, while investment advisory services are provided by New Ocean.

The Company currently holds majority equity interests, which are considered to be the controlling financial interests, in New Ocean FCFL and New Ocean MVCFL, and by extension, Vector Re. Accordingly, included in the consolidated financial statements of the Company are the total net assets of New Ocean FCFL, New Ocean MVCFL and Vector Re of $135.9 million and $139.9 million as of June 30, 2015 and December 31, 2014, respectively. The Company’s share of revenue and net income in these VIEs was not material to the Company for the three and six months endedJune 30, 2015. All inter-company transactions between the Company's entities have been eliminated in consolidation. The equity interest attributable to third party investors in New Ocean FCFL, New Ocean MVCFL and Vector Re recorded in the Company’s Consolidated Balance Sheets as "Non-controlling interest in equity of consolidated subsidiaries" was $52.0 million and $58.4 million as of June 30, 2015 and December 31, 2014, respectively.

13. Computation of Earnings Per Ordinary Share and Ordinary Share Equivalent

The following table sets forth the computation of basic and diluted earnings per ordinary share for the three and six months ended June 30, 2015 and 2014:

	Three Months Ended June 30,					Six Months Ended June 30,
(U.S. dollars in thousands, except per share amounts)	2015		2014			2015		2014
Basic earnings per ordinary share & ordinary share equivalents outstanding:
Net income (loss) attributable to ordinary shareholders	$	915,039	$	(279,260	)	$	951,320	$	(23,543	)
Weighted average ordinary shares outstanding, in thousands - basic	289,420		270,924			272,665		273,616
Basic earnings per ordinary share & ordinary share equivalents outstanding	$	3.16	$	(1.03	)	$	3.49	$	(0.09	)
Diluted earnings per ordinary share & ordinary share equivalents outstanding:
Weighted average ordinary shares outstanding, in thousands - basic	289,420		270,924			272,665		273,616
Impact of share-based compensation and certain conversion features, in thousands	4,563		—			4,808		—
Weighted average ordinary shares outstanding, in thousands - diluted	293,983		270,924			277,473		273,616
Diluted earnings per ordinary share & ordinary share equivalents outstanding	$	3.11	$	(1.03	)	$	3.43	$	(0.09	)
Dividends per ordinary share	$	0.16	$	0.16		$	0.32	$	0.32

46

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

For the three months ended June 30, 2015 and 2014, and for the six months ended June 30, 2015 and 2014, ordinary shares available for issuance under share-based compensation plans of 2.4 million and 16.8 million, respectively, and 4.5 million and 16.6 million, respectively, were not included in the calculation of diluted earnings per ordinary share because the assumed exercise or issuance of such shares would be anti-dilutive.

14. Commitments and Contingencies

(a) Financial Guarantee Exposures

The Company's outstanding financial guarantee contracts as of June 30, 2015 provide credit support for a variety of collateral types with the exposures comprised of an aggregate amount of $80.8 million notional financial guarantee on two notes backed by zero coupon long dated bonds and bank perpetual securities, including some issued by European financial institutions. As of June 30, 2015 and December 31, 2014, the total gross claim liability recorded was nil and the contracts had a weighted average contractual term to maturity of 24.7 years and 25.2 years, respectively.

Surveillance procedures to track and monitor credit deteriorations in the insured financial obligations are performed by the primary obligors for each transaction on the Company's behalf. Information regarding the performance status and updated exposure values is provided to the Company on a quarterly basis and evaluated by management in recording claims reserves. As of June 30, 2015, there were no reported events of default on these obligations.

(b) Litigation

The Company and its subsidiaries are subject to litigation and arbitration in the normal course of business. These lawsuits and arbitrations principally involve claims on policies of insurance and contracts of reinsurance and are typical for the Company and for the property and casualty insurance and reinsurance industry in general. Such claims proceedings are considered in connection with the Company's loss and loss expense reserves. Reserves in varying amounts may or may not be established in respect of particular claims proceedings based on many factors, including the legal merits thereof. In addition to litigation relating to insurance and reinsurance claims, the Company and its subsidiaries are subject to lawsuits and regulatory actions in the normal course of business that do not arise from or directly relate to claims on insurance or reinsurance policies. This category of business litigation typically involves, among other things, allegations of underwriting errors or misconduct, employment claims, regulatory activity, shareholder disputes or disputes arising from business ventures. The status of these legal actions is actively monitored by management.

Legal actions are subject to inherent uncertainties, and future events could change management's assessment of the probability or estimated amount of potential losses from pending or threatened legal actions. Based on available information, it is the opinion of management that the ultimate resolution of pending or threatened legal actions other than claims proceedings, both individually and in the aggregate, will not result in losses having a material adverse effect on the Company's financial position or liquidity as of June 30, 2015.

If management believes that, based on available information, it is at least reasonably possible that a material loss (or additional material loss in excess of any accrual) will be incurred in connection with any legal actions, the Company discloses an estimate of the possible loss or range of loss, either individually or in the aggregate, as appropriate, if such an estimate can be made, or discloses that an estimate cannot be made. Based on the Company's assessment as of June 30, 2015, no such disclosures were considered necessary.

47

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

15. Accumulated Other Comprehensive Income (Loss)

The changes in AOCI, net of tax, by component for the three and six months ended June 30, 2015 and 2014 are as follows:

Three months ended June 30, 2015 (U.S. dollars in thousands)	Unrealized Gains (Losses) on Investments (1)			OTTI Losses Recognized in AOCI			Foreign Currency Translation Adjustments			Underfunded Pension Liability			Cash Flow Hedge		Total
Balance, beginning of period, net of tax	$	1,763,795		$	(66,189	)	$	24,915		$	(19,814	)	$	2,463	$	1,705,170
OCI before reclassifications	(544,273		)	—			(36,362		)	(1,329		)	—		(581,964		)
Amounts reclassified from AOCI	(87,558		)	1,662			—			—			12		(85,884		)
Tax benefit (expense)	37,000			(87		)	1,939			—			—		38,852
Net current period OCI - net of tax	(594,831		)	1,575			(34,423		)	(1,329		)	12		(628,996		)
Balance, end of period, net of tax	$	1,168,964		$	(64,614	)	$	(9,508	)	$	(21,143	)	$	2,475	$	1,076,174
Three months ended June 30, 2014 (U.S. dollars in thousands)
Balance, beginning of period, net of tax	$	1,032,941		$	(85,894	)	$	10,661		$	(13,270	)	$	2,223	$	946,661
OCI before reclassifications	363,348			—			(3,621		)	(8		)	—		359,719
Amounts reclassified from AOCI	(74,337		)	1,640			—			—			110		(72,587		)
Tax benefit (expense)	(20,774		)	(4		)	(5,981		)	—			—		(26,759		)
Net current period OCI - net of tax	268,237			1,636			(9,602		)	(8		)	110		260,373
Balance, end of period, net of tax	$	1,301,178		$	(84,258	)	$	1,059		$	(13,278	)	$	2,333	$	1,207,034
Six months ended June 30, 2015 (U.S. dollars in thousands)
Balance, beginning of period, net of tax	$	1,590,114		$	(76,047	)	$	(11,188	)	$	(20,789	)	$	2,368	$	1,484,458
OCI before reclassifications	(290,007		)	—			(3,958		)	(354		)	—		(294,319		)
Amounts reclassified from AOCI	(162,338		)	11,598			—			—			107		(150,633		)
Tax benefit (expense)	31,195			(165		)	5,638			—			—		36,668
Net current period OCI - net of tax	(421,150		)	11,433			1,680			(354		)	107		(408,284		)
Balance, end of period, net of tax	$	1,168,964		$	(64,614	)	$	(9,508	)	$	(21,143	)	$	2,475	$	1,076,174
Six months ended June 30, 2014 (U.S. dollars in thousands)
Balance, beginning of period, net of tax	$	822,432		$	(89,190	)	$	14,541		$	(13,239	)	$	2,113	$	736,657
OCI before reclassifications	628,599			—			(9,521		)	(39		)	—		619,039
Amounts reclassified from AOCI	(96,975		)	5,049			—			—			220		(91,706		)
Tax benefit (expense)	(52,878		)	(117		)	(3,961		)	—			—		(56,956		)
Net current period OCI - net of tax	478,746			4,932			(13,482		)	(39		)	220		470,377
Balance, end of period, net of tax	$	1,301,178		$	(84,258	)	$	1,059		$	(13,278	)	$	2,333	$	1,207,034

____________

(1) Included in these amounts is the impact of Shadow Adjustments. As of December 31, 2014 the cumulative impact of the Shadow Adjustments was $445.1 million. During the six months ended June 30, 2015, net movements of $(86.7) million were recorded, resulting in a total cumulative net impact of Shadow Adjustments on future policy benefit reserves of $358.4 million as of June 30, 2015.

48

XL GROUP PLC

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The reclassifications out of AOCI along with the associated income statement line items affected by component, and the total related tax (expense) benefit for the three and six months ended June 30, 2015 and 2014 are as follows:

Gross Amount Reclassified From AOCI
Details About AOCI Components (U.S. dollars in thousands)	Three months ended June 30, 2015			Three months ended June 30, 2014			Six months ended June 30, 2015			Six months ended June 30, 2014			Affected Line Item in the Statement of Income
Unrealized gains and losses on investments:
	$	(71,027	)	$	(107,470	)	$	(149,578	)	$	(132,384	)	Net realized gains (losses) on investments sold and net unrealized gains (losses) on investments Trading
	19,398			33,133			35,122			35,409			OTTI on investments
	$	(35,929	)	$	—		$	(47,882	)	$	—		Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets
	$	(87,558	)	$	(74,337	)	$	(162,338	)	$	(96,975	)	Total before tax
	3,694			3,699			3,781			4,152			Provision (benefit) for income tax
	$	(83,864	)	$	(70,638	)	$	(158,557	)	$	(92,823	)	Net of tax
OTTI losses recognized in OCI:
	$	1,594		$	1,386		$	11,469		$	3,344		Net realized gains (losses) on investments sold
	68			254			129			1,705			OTTI on investments transferred to (from) OCI
	$	1,662		$	1,640		$	11,598		$	5,049		Total before tax
	(12		)	(4		)	(15		)	(117		)	Provision (benefit) for income tax
	$	1,650		$	1,636		$	11,583		$	4,932		Net of tax
Gains and losses on cash flow hedges:
Interest rate contracts	$	12		$	110		$	107		$	220		Interest Expense
	—			—			—			—			Provision (benefit) for income tax
	$	12		$	110		$	107		$	220		Net of tax
Total reclassifications for the period, gross of tax	$	(85,884	)	$	(72,587	)	$	(150,633	)	$	(91,706	)
Tax benefit (expense)	3,682			3,695			3,766			4,035
Total reclassifications for the period, net of tax	$	(82,202	)	$	(68,892	)	$	(146,867	)	$	(87,671	)

49

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL

The following is a discussion of our financial condition, liquidity and results of operations. Certain aspects of our business have loss experience characterized as low frequency and high severity. This may result in volatility from period to period in both the Company's and an individual segment's results of operations and financial condition. Unless the context otherwise indicates, references herein to "the Company," "we," "us," or "our" are to XL Group plc, an Irish public limited company ("XL-Ireland"), and its consolidated subsidiaries.

This "Management's Discussion and Analysis of Financial Condition and Results of Operations" contains forward-looking statements that involve inherent risks and uncertainties. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. These statements are based upon current plans, estimates and expectations. Actual results may differ materially from those projected in such forward-looking statements and, therefore, undue reliance should not be placed on them. See "Cautionary Note Regarding Forward-Looking Statements" for a list of additional factors that could cause actual results to differ materially from those contained in any forward-looking statement, as well as Item 1A, "Risk Factors," included in our Annual Report on Form 10-K for the year ended December 31, 2014.

This discussion and analysis should be read in conjunction with the "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the audited Consolidated Financial Statements and Notes thereto, reported in Items 7 and 8, respectively, of our Annual Report on Form 10-K for the year ended December 31, 2014.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

The Private Securities Litigation Reform Act of 1995 ("PSLRA") provides a "safe harbor" for forward-looking statements. Any prospectus, prospectus supplement, Annual Report to ordinary shareholders, proxy statement, Form 10-K, Form 10-Q or Form 8-K or any other written or oral statements made by us or on our behalf may include forward-looking statements that reflect our current views with respect to future events and financial performance. Such statements include forward-looking statements both with respect to us in general, and to the insurance and reinsurance sectors in particular (both as to underwriting and investment matters). Statements that include the words "expect," "intend," "plan," "believe," "project," "anticipate," "may," "could," or "would" and similar statements of a future or forward-looking nature identify forward-looking statements for purposes of the PSLRA or otherwise.

All forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in such statements. We believe that these factors include, but are not limited to, the following:

• changes in the size of our claims relating to natural or man-made catastrophe losses due to the preliminary nature of some reports and estimates of loss and damage to date;

• trends in rates for property and casualty insurance and reinsurance;

• the timely and full recoverability of reinsurance placed by us with third parties, or other amounts due to us;

• changes in the projected amount of ceded reinsurance recoverables and the credit ratings and creditworthiness of reinsurers;

• actual loss experience from insured or reinsured events and the timing of claims payments being faster or the receipt of reinsurance recoverables being slower than we anticipated;

• increased competition on the basis of pricing, capacity, coverage terms or other factors, such as the increased inflow of third party capital into reinsurance markets, which could harm our ability to maintain or increase our business volumes or profitability;

• greater frequency or severity of claims and loss activity than our underwriting, reserving or investment practices anticipate based on historical experience or industry data;

• the impact of changes in the global financial markets, such as the effects of inflation on our business, including on pricing and reserving, increased government involvement or intervention in the financial services industry, changes in interest rates, credit spreads and foreign currency exchange rates and future volatility in the world's credit, financial and capital markets that adversely affect the performance and valuation of our investments, future financing activities and access to such markets or general financial condition;

• our ability to successfully implement our business strategy;

50

• our ability to successfully attract and raise additional third party capital for existing or new investment vehicles;

• the potential impact on us from government-mandated insurance coverage for acts of terrorism and other regulation;

• changes in credit ratings or rating agency policies or practices;

• the potential for changes to methodologies, estimations and assumptions that underlie the valuation of our financial instruments that could result in changes to investment valuations;

• changes to our assessment as to whether it is more likely than not that we will be required to sell, or have the intent to sell, available for sale fixed maturity securities before their anticipated recovery;

• the availability of borrowings and letters of credit under our credit facilities;

• the ability of our subsidiaries to pay dividends to XL-Ireland and our wholly-owned subsidiaries XLIT Ltd. ("XL-Cayman") and XL Insurance (Bermuda) Ltd ("XLIB");

• the potential effect of legislative or regulatory developments applicable to us or our subsidiaries, brokers or customers in the jurisdictions in which we operate, such as those that could impact the financial markets or increase our business costs and required capital levels, including but not limited to changes in regulatory capital balances that must be maintained by our operating subsidiaries and governmental actions for the purpose of stabilizing the financial markets;

• the effects of business disruption, economic contraction or economic sanctions due to global political and social conditions such as war, terrorism or other hostilities, or pandemics;

• the actual amount of new and renewal business and acceptance of our products and services, including new products and services and the materialization of risks related to such products and services;

• changes in the availability, cost or quality of ceded reinsurance;

• changes in the distribution or placement of risks due to increased consolidation of insurance and reinsurance brokers and bankruptcies or other financial concerns of companies insofar as they affect property and casualty insurance and reinsurance coverages or claims that we may have as a counterparty;

• inability to retain key personnel, including in connection with the integration of Catlin Group Limited and its consolidated subsidiaries ("Catlin");

• changes in accounting standards, policies or practices or the application thereof;

• the effects of mergers, acquisitions and divestitures, including our ability to modify our internal control over financial reporting as a result of any of such transactions, changes to our risk appetite as a result of such transactions and our ability to realize the value or benefits expected as a result of such transactions, including the life retrocession arrangements and the acquisition of Catlin;

• changes in general economic conditions, including new or continued sovereign debt concerns in Euro-Zone countries or downgrades of U.S. securities by credit rating agencies, which could affect our financial condition, results of operations, liquidity or cash flows;

• changes in applicable tax laws, tax treaties or tax regulations or the interpretation or enforcement thereof;

• judicial decisions and rulings, new theories of liability or emerging claims coverage issues, legal tactics and settlement terms;

• the other factors set forth in Item 1A, "Risk Factors," included in our Annual Report on Form 10-K for the year ended December 31, 2014 and our other documents on file with the SEC.

The foregoing review of important factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included herein or elsewhere. We undertake no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by the federal securities laws.

EXECUTIVE OVERVIEW

See "Management's Discussion and Analysis of Financial Condition and Results of Operations - Executive Overview," included in Item 7 of our Annual Report on Form 10-K filed for the year ended December 31, 2014. That discussion is updated with the disclosures set forth below.

On May 1, 2015 (the "Acquisition Date"), we completed our acquisition (the "Catlin Acquisition") of the entire issued share capital of Catlin for $4.1 billion in cash and ordinary shares of XL-Ireland, as contemplated by that certain

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Implementation Agreement, dated January 9, 2015 (the "Implementation Agreement"), by and among XL-Ireland, Green Holdings Limited, a wholly-owned subsidiary of the Company ("Green Holdings"), and Catlin. Prior to the closing of the Catlin Acquisition, Catlin was a publicly traded company listed on the London Stock Exchange and headquartered in Bermuda. Catlin, through its wholly-owned subsidiaries, provided property, casualty and specialty insurance and reinsurance coverage on a worldwide basis. Our results of operations for the three and six months endedJune 30, 2015 include the results of operations of Catlin for the period from May 1, 2015 through June 30, 2015. See Item 1, Note 3(a), "Acquisition and Disposals - Catlin Acquisition," to the Unaudited Consolidated Financial Statements included herein for additional information with respect to the Catlin Acquisition.

RESULTS OF OPERATIONS AND KEY FINANCIAL MEASURES

Results of Operations

The following table presents an analysis of our net income (loss) attributable to ordinary shareholders and other financial measures (described below) for the three and six months ended June 30, 2015 and 2014:

(U.S. dollars in thousands, except per share amounts)	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2015		2014			2015		2014
Net income (loss) attributable to ordinary shareholders	$	915,039	$	(279,260	)	$	951,320	$	(23,543	)
Earnings (loss) per ordinary share – basic	$	3.16	$	(1.03	)	$	3.49	$	(0.09	)
Earnings (loss) per ordinary share – diluted	$	3.11	$	(1.03	)	$	3.43	$	(0.09	)
Weighted average number of ordinary shares and ordinary share equivalents, in thousands – basic	289,420		270,924			272,665		273,616
Weighted average number of ordinary shares and ordinary share equivalents, in thousands – diluted	293,983		270,924			277,473		273,616

Key Financial Measures

The following are some of the financial measures management considers important in evaluating our operating performance:

	Three Months Ended									Six Months Ended
	June 30,						Change			June 30,						Change
(U.S. dollars in thousands, except ratios and per share amounts)	2015			2014			2015 to 2014			2015			2014			2015 to 2014
Underwriting profit (loss) - P&C operations	$	208,779		$	167,947		24.3		%	$	355,615		$	312,821		13.7		%
Combined ratio - P&C operations	89.9		%	88.3		%	1.6pts			89.5		%	89.0		%	0.5pts
Net investment income - P&C operations (1)	$	165,509		$	161,490		2.5		%	$	313,393		$	323,787		(3.2		)%
Operating net income (2)	$	245,797		$	279,577		(12.1		)%	$	440,173		$	518,226		(15.1		)%
Operating net income per ordinary share (2)	$	0.84		$	1.02		$	(0.18	)	$	1.59		$	1.86		$	(0.27	)
Annualized return on average ordinary shareholders’ equity (2)	32.5		%	(11.0		)%	43.5pts			17.1		%	(0.5		)%	17.6pts
Annualized operating return on average ordinary shareholders’ equity (2)	8.7		%	11.0		%	(2.3)pts			7.9		%	10.3		%	(2.4)pts
Annualized operating return on average ordinary shareholders’ equity excluding unrealized gains and losses on investments (2)	10.0		%	12.3		%	(2.3)pts			9.0		%	11.5		%	(2.5)pts
(U.S. dollars)	June 30, 2015			March 31, 2015			Change (Three Months)			June 30, 2015			December 31, 2014			Change (Six Months)
Book value per ordinary share (2)	$	40.30		$	39.90		$	0.40		$	40.30		$	39.31		$	0.99
Fully diluted tangible book value per ordinary share (2)	$	32.53		$	37.60		$	(5.07	)	$	32.53		$	36.79		$	(4.26	)

____________

(1) Net investment income - P&C operations includes net investment income related to the net results from structured products and excluding Life Funds Withheld Assets, as defined below.

(2) Represents a non-GAAP financial measure as discussed further below.

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The following are descriptions of these key financial measures and a brief discussion of the factors influencing them:

Underwriting profit – property and casualty insurance and reinsurance ("P&C") operations

One way that we evaluate the performance of our P&C operations is by underwriting profit or loss. We do not measure performance based on the amount of gross premiums written. Underwriting profit or loss is calculated from premiums earned less net losses incurred and expenses related to underwriting activities.

In the following discussion as well as in the "Income Statement Analysis" section, the following ratios are used to explain the underwriting profit (loss) from our P&C operations:

▪ The combined ratio related to the P&C operations is the sum of the loss and loss expense ratio and the underwriting expense ratio. A combined ratio under 100% represents an underwriting profit and over 100% represents an underwriting loss. In the P&C industry, the combined ratio is a widely used measure of underwriting profitability.

▪ The loss and loss expense ratio related to the P&C operations is calculated by dividing the losses and loss expenses incurred by the net premiums earned for the Insurance and Reinsurance segments.

▪ The underwriting expense ratio related to the P&C operations is the sum of acquisition costs and operating expenses for the Insurance and Reinsurance segments divided by net premiums earned for the Insurance and Reinsurance segments.

▪ The acquisition expense ratio related to the P&C operations is calculated by dividing the acquisition costs incurred by the net premiums earned for the Insurance and Reinsurance segments.

▪ The operating expense ratio related to the P&C operations is calculated by dividing the operating expenses incurred by the net premiums earned for the Insurance and Reinsurance segments.

Our underwriting profit (loss) in the three and six months ended June 30, 2015 and 2014 was consistent with the combined ratio, discussed below.

Combined ratio – P&C operations

The following table presents the ratios for our P&C operations for the three and six months ended June 30, 2015 and 2014:

	Three Months Ended						Six Months Ended
	June 30,				Change		June 30,				Change
	2015		2014		2015 to 2014		2015		2014		2015 to 2014
Loss and loss expense ratio	55.8	%	57.6	%	(1.8	)	56.8	%	58.2	%	(1.4	)
Acquisition expense ratio	16.5	%	12.6	%	3.9		14.5	%	13.1	%	1.4
Operating expense ratio	17.6	%	18.1	%	(0.5	)	18.2	%	17.7	%	0.5
Underwriting expense ratio	34.1	%	30.7	%	3.4		32.7	%	30.8	%	1.9
Combined ratio	89.9	%	88.3	%	1.6		89.5	%	89.0	%	0.5

Three months ended June 30, 2015 vs. 2014: The 1.6 percentage point increase in our combined ratio was the result of a underwriting expense ratio increase of 3.4 percentage points, which was mainly driven by an increase in acquisition expenses due to increases in commissions in both segments as a result of the Catlin Acquisition, partially offset by a decrease in the loss ratio of 1.8 percentage points, mainly due to higher levels of favorable prior year reserve development in 2015.

Six months ended June 30, 2015 vs. 2014: The 0.5 percentage point increase in our combined ratio was the result of the underwriting expense ratio increase of 1.9 percentage points, which was mainly driven by an increase in acquisition expenses in the Insurance segment and a change in the reinsurance structure in the International primary casualty group in our Insurance segment, plus an increase in operating expenses as a result of higher compensation costs from increased headcount due to business expansion in the prior year. This was partially offset by a decrease in the loss ratio of 1.4 percentage points, mainly due to higher levels of favorable prior year reserve development.

For further information on our combined ratio, see "Income Statement Analysis" below.

Net investment income - Excluding Life Funds Withheld Assets

This measure excludes income from assets held to support the transaction outlined in Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary" ("Life Funds Withheld Assets"), includes interest and dividend income together with the amortization of premium and discount on fixed maturities and short-term investments, net of related investment expenses, and is an important measure that affects our overall profitability. Our largest liability relates to our unpaid loss reserves, and our investment portfolio provides liquidity for claims settlements of these reserves as they become due. As a result, a significant part of the investment portfolio is invested in fixed income securities. Net investment income is influenced

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by a number of factors, including the amounts and timing of inward and outward cash flows, the level of interest rates and credit spreads, foreign exchange rates and changes in overall asset allocation. See the segment results under "Investment Activities" below for a discussion of our net investment income for the three and six months endedJune 30, 2015.

Operating net income and Operating net income per ordinary share

Operating net income is a non-GAAP financial measure defined as net income (loss) attributable to ordinary shareholders excluding: (1) our net investment income - Life Funds Withheld Assets, net of tax, (2) our net realized gains and losses on investments sold - excluding Life Funds Withheld Assets, net of tax, (3) our net realized gains and losses on investments sold - Life Funds Withheld Assets, other than temporary impairments ("OTTI") - Life Funds Withheld Assets, and net unrealized gains and losses on investments, trading - Life Funds Withheld Assets, (4) our net realized and unrealized gains and losses on derivatives, net of tax, (5) our net realized and unrealized gains and losses on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets, net of tax, (6) our share of items (2) and (4) for our insurance company affiliates for the periods presented, (7) our loss on the sale of the life reinsurance subsidiary, net of tax, (8) our foreign exchange gains and losses, net of tax, (9) our foreign exchange gains and losses, net of tax, (10) our expenses related to the Catlin Acquisition, net of tax and (11) our gain on sale on the sale of our operating affiliate. We evaluate the performance of and manage our business to produce an underwriting profit. In addition to presenting net income (loss), we believe that showing operating net income (loss) enables investors and other users of our financial information to analyze our performance in a manner similar to how we analyze our performance. In this regard, we believe that providing only a GAAP presentation of net income (loss) would make it more difficult for users of our financial information to evaluate our underlying business. We also believe that equity analysts and certain rating agencies that follow us (and the insurance industry as a whole) exclude these items from their analyses for the same reasons, and they request that we provide this non-GAAP financial information on a regular basis. A reconciliation of our net income (loss) attributable to ordinary shareholders to operating net income (loss) is provided at "Reconciliation of Non-GAAP Measures" below.

Operating net income per ordinary share is calculated by dividing non-GAAP operating net income by the weighted average number of ordinary shares and ordinary share equivalents outstanding for each period combined with the impact from dilution of share-based compensation and certain conversion features where dilutive.

Annualized return on average ordinary shareholders' equity ("ROE")

ROE is another non-GAAP financial measure that we consider important in evaluating our operating performance and view as a key measure of return generated for ordinary shareholders. ROE is calculated by dividing the net income (loss) attributable to ordinary shareholders for any period by the average of the opening and closing Shareholders' equity attributable to XL-Ireland. We establish minimum target ROEs for our total operations, segments and lines of business. If our minimum ROE targets over the longer term are not met with respect to any line of business, we seek to modify and/or exit this line. In addition, among other factors, compensation of our senior officers is dependent on the achievement of our performance goals to enhance ordinary shareholder value as measured by ROE (adjusted for certain items considered to be "non-operating" in nature).

The following table presents our ROE for the three and six months ended June 30, 2015 and 2014:

	Three Months Ended					Six Months Ended
	June 30,				Change	June 30,				Change
	2015		2014		2015 to 2014	2015		2014		2014 to 2013
ROE	32.5	%	(11.0	)%	43.5pts	17.1	%	(0.5	)%	17.6pts

Three months ended 2015 vs. 2014: The increase in our ROE for the three months ended June 30, 2015 as compared to the same period of 2014 was due to an increase in our net income attributable to ordinary shareholders during the three and six months endedJune 30, 2015, due to the gain on the sale of our operating affiliate, ARX Holding Corp ("ARX"), as well as the effect of the realized and unrealized gains from the life retrocession derivative, which increases earnings while having no effect on equity. See Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary" included herein for further details of this transaction. In addition, the prior year included a loss on the sale of our life reinsurance subsidiary.

Six months ended2015 vs. 2014: The increase in our ROE for the six months ended June 30, 2015 as compared to the same period of 2014 was due to an increase in our net income attributable to ordinary shareholders during the six months ended June 30, 2015, due to the gain on the sale of our operating affiliate, ARX. In addition, the prior year included a loss on the sale of our life reinsurance subsidiary.

For more information on the Catlin Acquisition, the gain on the sale of our operating affiliate, and the sale of our life reinsurance subsidiary, see Item 1, Note 3(a), "Acquisition and Disposals - Catlin Acquisition," to the Unaudited Consolidated Financial Statements included herein.

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Annualized operating return on average ordinary shareholders’ equity ("Operating ROE")

Operating ROE is another non-GAAP financial measure that we consider important in evaluating our operating performance. Operating ROE is derived by dividing non-GAAP operating net income for any period by the average of the opening and closing ordinary shareholders' equity.

The following table presents our Operating ROE for the three and six months ended June 30, 2015 and 2014:

	Three Months Ended					Six Months Ended
	June 30,				Change	June 30,				Change
	2015		2014		2015 to 2014	2015		2014		2015 to 2014
Operating ROE	8.7	%	11.0	%	(2.3)pts	7.9	%	10.3	%	(2.4)pts

Three and six months ended2015 vs. 2014: The decrease in our Operating ROE was the result of lower operating net income in 2015 due to decreases in investment income and increases in expenses for the three and six months endedJune 30, 2015, as compared to the same periods of 2014. A detailed discussion of our individual segment operating results is included below under "Income Statement Analysis".

A reconciliation of Net income (loss) attributable to ordinary shareholders to operating net income (loss) is provided under "Reconciliation of Non-GAAP Measures" below.

Annualized operating return on average ordinary shareholders' equity excluding unrealized gains and losses on investments ("Operating ROE ex-UGL")

Operating ROE ex-UGL is an additional measure of our profitability that eliminates the impacts of mark to market fluctuations on our investment portfolio that have not been realized through sales, which we believe provides a consistent measure of our performance. Operating ROE ex-UGL is derived from the non-GAAP operating net income measure by dividing non-GAAP operating net income for any period by the average of the opening and closing ordinary shareholders' equity excluding unrealized gains and losses on investments. A reconciliation of the opening and closing ordinary shareholders' equity to the opening and closing ordinary shareholders' equity excluding unrealized gains and losses on investments is provided under "Reconciliation of Non-GAAP Measures" below.

The following table presents our Operating ROE ex-UGL for the three and six months ended June 30, 2015 and 2014:

	Three Months Ended					Six Months Ended
	June 30,				Change	June 30,				Change
	2015		2014		2015 to 2014	2015		2014		2015 to 2014
Operating ROE ex-UGL	10.0	%	12.3	%	(2.3)pts	9.0	%	11.5	%	(2.5)pts

Three and six months ended2015 vs. 2014: The decrease in our Operating ROE ex-UGL was the result of the lower operating net income in 2015 due to the factors discussed above as part of Operating ROE.

Book value per ordinary share

We view the change in our book value per ordinary share as an additional measure of our performance, representing the value generated for our ordinary shareholders each period, and we believe that this measure (along with the diluted measures described below) is a key driver of our share price over time. Book value per ordinary share, a non-GAAP financial measure, is calculated by dividing ordinary shareholders' equity (total shareholders' equity less non-controlling interest in equity of consolidated subsidiaries) by the number of outstanding ordinary shares at the applicable period end. Book value per ordinary share is affected primarily by net income (loss), by any changes in the net unrealized gains and losses on our investment portfolio, by currency translation adjustments and by the impact of any share buyback or issuance activity. Ordinary shareholders' equity was $12.2 billion and $10.0 billion and the number of ordinary shares outstanding was 303.9 million and 255.2 million as of June 30, 2015 and December 31, 2014, respectively. Ordinary shares outstanding include all ordinary shares issued and outstanding (as disclosed on the face of the balance sheets) as well as all director share units outstanding.

The following table presents our book value per ordinary share as of June 30, 2015 and December 31, 2014:

(U.S. dollars)	June 30, 2015		March 31, 2015		Change (Three Months)		June 30, 2015		December 31, 2014		Change (Six Months)
Book value per ordinary share	$	40.30	$	39.90	$	0.40	$	40.3	$	39.31	$	0.99

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Three and six months ended2015 vs. 2014: The increase in our book value per ordinary share was primarily due to an increase in our current quarter net income attributable to ordinary shareholders as a result of the gain on sale of our operating affiliate, ARX, partially offset by the increase in outstanding shares as a result of the Catlin Acquisition, as well as net unrealized losses on investments opposed to gains in 2014.

Fully diluted tangible book value per ordinary share

Fully diluted tangible book value per ordinary share is a non-GAAP financial measure and is calculated by dividing ordinary shareholders' equity excluding intangible assets (as disclosed on the face of the balance sheets) by the number of outstanding ordinary shares at the applicable period end combined with the impact from dilution of share-based compensation and certain conversion features where dilutive.

The following table presents our fully diluted tangible book value per ordinary share as of June 30, 2015 and December 31, 2014:

(U.S. dollars)	June 30, 2015		March 31, 2015		Change (Three Months)			June 30, 2015		December 31, 2014		Change (Six Months)
Fully diluted tangible book value per ordinary share	$	32.53	$	37.60	$	(5.07	)	$	32.53	$	36.79	$	(4.26	)

Three and six months ended2015 vs. 2014: The decrease in our fully diluted tangible book value per ordinary share was primarily the result of increased goodwill and intangible assets acquired as part of the Catlin Acquisition in exchange for cash and equity consideration.

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RECONCILIATION OF NON-GAAP MEASURES

The following is a reconciliation of net income (loss) attributable to ordinary shareholders to operating net income (loss) and also includes the calculation of Operating ROE and Operating ROE ex-UGL for the three and six months ended June 30, 2015 and 2014:

(U.S. dollars in thousands, except ratios and per share amounts)	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2015			2014			2015			2014
Net income (loss) attributable to ordinary shareholders	$	915,039		$	(279,260	)	$	951,320		$	(23,543	)
Net realized and unrealized (gains) losses on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	(239,174		)	17,546			(9,807		)	17,546
Net realized (gains) losses on investments and net unrealized (gains) losses on investments, Trading - Life Funds Withheld Assets	(45,616		)	8,147			(93,905		)	8,147
Net investment income - Life Funds Withheld Assets	(46,864		)	(19,165		)	(97,283		)	(19,165		)
Foreign exchange revaluation (gains) losses on and other income and expense items related to Life Funds Withheld Assets	14,597			19			12,211			19
Loss on sale of life reinsurance subsidiary, net of tax	—			621,323			—			621,323
Net income (loss) attributable to ordinary shareholders excluding Contribution from Life Retrocession Arrangements (1)	597,982			348,610			762,536			604,327
Net realized (gains) losses on investments sold - excluding Life Funds Withheld Assets, net of tax	(669		)	(77,149		)	(5,187		)	(96,038		)
Net realized and unrealized (gains) losses on derivatives	(48,667		)	(11,596		)	(65,188		)	(13,406		)
Net realized and unrealized (gains) losses on investments and derivatives related to the Company's insurance company affiliates, net of tax	595			1,222			1,253			(2,736		)
Exchange (gains) losses, net of tax	624			18,490			25,363			26,079
Expenses related to Catlin acquisition, net of tax	36,339			—			61,803			—
Gain on sale of operating affiliate	(340,407		)	—			(340,407		)	—
Operating net income (loss)	$	245,797		$	279,577		$	440,173		$	518,226
Per ordinary share results:
Net income (loss) attributable to ordinary shareholders	$	3.11		$	(1.03	)	$	3.43		$	(0.09	)
Operating net income (loss)	$	0.84		$	1.02		$	1.59		$	1.86
Weighted average ordinary shares outstanding:
Basic	289,420			270,924			272,665			273,616
Diluted - Net income	293,983			270,924			277,473			273,616
Diluted - Operating net income	293,983			275,200			277,473			277,918
Return on ordinary shareholders' equity:
Closing ordinary shareholders' equity (at period end)	$	12,247,298		$	10,034,289		$	12,247,298		$	10,034,289
Unrealized (gain) loss on investments, net of tax	$	(1,104,350	)	$	(1,216,920	)	$	(1,104,350	)	$	(1,216,920	)
Average ordinary shareholders' equity for the period excluding unrealized gains and losses on investments	$	9,844,700		$	9,057,642		$	9,831,316		$	9,040,880
Average ordinary shareholders' equity for the period	$	11,245,678		$	10,139,626		$	11,140,525		$	10,015,961
Operating net income (loss)	$	245,797		$	279,577		$	440,173		$	518,226
Annualized operating net income (loss)	$	983,188		$	1,118,308		$	880,346		$	1,036,452
Annualized return on ordinary shareholders' equity - operating net income	8.7		%	11.0		%	7.9		%	10.3		%
Annualized return on ordinary shareholders' equity excluding unrealized gains and losses on investments - operating net income	10.0		%	12.3		%	9.0		%	11.5		%

____________

(1) Investment results for the Life Funds Withheld Assets - including interest income, unrealized gains and losses, and gains and losses from sales - are passed directly to the reinsurer pursuant to a contractual arrangement which is accounted for as a derivative. Changes in the fair value of the embedded derivative associated with these Life Retrocession Arrangements are grouped within "Net realized and unrealized (gains) losses on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets" in the reconciliation above.

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SIGNIFICANT ITEMS AFFECTING THE RESULTS OF OPERATIONS

Our net income and other financial measures as shown above for the three and six months endedJune 30, 2015 have been affected by, among other things, the following significant items:

1)    The Catlin Acquisition

2)    The sale of our interest in our operating affiliate, ARX

3)    The current underwriting environment; and

4)    Market movement impacts on our investment portfolio.

1) Catlin Acquisition

On May 1, 2015, we completed the acquisition of Catlin for $4.1 billion, as contemplated by the Implementation Agreement by and among XL-Ireland, Green Holdings and Catlin.

Pursuant to the terms of the Implementation Agreement, the Catlin Acquisition was implemented by way of a scheme of arrangement (the "Scheme") under Section 99 of the Companies Act 1981 of Bermuda, as amended (the "Companies Act"), and sanctioned by the Supreme Court of Bermuda (the "Court"), immediately after which Catlin was merged with and into Green Holdings under Section 104H of the Companies Act, with Green Holdings as the surviving company, pursuant to the terms of that certain Merger Agreement, dated January 9, 2015 (the "Merger Agreement"), among XL-Ireland, Green Holdings and Catlin.

Pursuant to the terms of the Implementation Agreement, XL-Ireland acquired each ordinary share of Catlin, par value $0.01 per share ("Catlin Shares"), for consideration per Catlin Share (the "Acquisition Consideration") equal to 388 pence in cash and 0.130 of an XL-Ireland ordinary share, par value $0.01 per share ("XL Shares"), subject to the mix and match facility set forth in the Implementation Agreement. The newly-issued XL Shares are listed on the New York Stock Exchange. The XL Shares issued in connection with the Catlin Acquisition were issued in reliance upon the exemption from registration under the U.S. Securities Act of 1933, as amended (the "Securities Act") provided by Section 3(a)(10) of the Securities Act.

XL-Ireland issued approximately 49.9 million XL Shares and paid approximately £1.49 billion in cash to the holders of Catlin Shares as Acquisition Consideration pursuant to the terms of the Scheme.

Transaction-related Costs

We incurred certain acquisition and financing costs associated with the transaction. We have recorded $61.8 million of these costs for the six months ended June 30, 2015, of which $47.3 million has been included in Operating Expense and $14.5 million has been included in Interest Expense.

Transaction costs included in Operating Expense primarily consist of due diligence, legal, advisory and investment banking costs. Pursuant to the terms of the Implementation Agreement, Catlin was required to pay its own costs and expenses in relation to the negotiation, preparation, execution and implementation of the Catlin Acquisition. Costs incurred by Catlin were recorded and paid by Catlin prior to the Acquisition Date and are not included within our consolidated statements of income and comprehensive income.

As a part of the ongoing integration of Catlin's operations, the Company incurs costs associated with restructuring the systems, processes and workforce. These costs include such items as severance, retention, facilities and consulting and other costs. The Company separately identifies such costs and includes these expenses within Corporate and Other:

(U.S. dollars in thousands)	Severance costs		Retention costs		Facilities-related costs		Consulting and other
Costs incurred in 2015	$	12,274	$	365	$	1,530	$	13,676
2015 payments	1,639		—		462		4,573
Liabilities at June 30, 2015	$	10,635	$	365	$	1,068	$	9,103

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Financial Results

The following table summarizes the results of the acquired Catlin business since the Acquisition Date that has been included within the Company's consolidated statements of income and comprehensive income.

(U.S. dollars in thousands)	May 1, 2015 to June 30, 2015
Total revenues	$	709,800
Net income (loss) attributable to ordinary shareholders	$	50,017

2) Sale of Operating Affiliate

On April 1, 2015, XL Re Ltd ("XL Re"), an indirect wholly-owned subsidiary of XL-Ireland, completed the previously announced sale of all of its shares in ARX to The Progressive Corporation ("Progressive") pursuant to the terms of the Stock Purchase Agreement with Progressive. XL Re's shares in ARX represented approximately 40.6% of ARX's outstanding capital stock on a fully diluted basis at the time of the announcement. The carrying value of XL Re's shares in ARX was $220.2 million at the time of the sale.

XL Re received $560.6 million in proceeds from the transaction, which was based upon the consolidated tangible net book value of ARX and its subsidiaries as of December 31, 2014, and certain other factors. Thus, the Company recorded a gain of $340.4 million as a result of this transaction, which is reflected in the unaudited consolidated statement of income for the three and six months endedJune 30, 2015.

3) The Current Underwriting Environment

There can be no assurance that the following (re)insurance rate conditions or growth opportunities will be sustained or further materialize, or lead to improvements in our books of business. See "Cautionary Note Regarding Forward-Looking Statements."

Insurance

Overall rate changes were down 2 to 3 percent for the three months ended June 30, 2015, driven particularly by shorter-tail lines, such as property, energy and aerospace. In the second quarter, our Casualty and Professional divisions were down 1%, with only cybertech and North American environmental businesses achieving material rate increases. Our Specialty division was down 3%, largely reflecting continued competitive conditions in the aviation lines. Our Energy, Property and Construction division was most severely impacted, with pricing down in the mid-single digits, led by reductions in the energy book driven largely by the recent fall in oil prices.

Growth in gross premiums written across the Insurance segment was strong across all of our underwriting divisions, driven largely by the Catlin Acquisition. While our results only reflect activity of the acquired Catlin business since the Acquisition Date, when we evaluate both legacy organizations over the full quarter and normalize for foreign exchange and other one-time adjustments, our growth is roughly 2% for the quarter and 4% for the year to date. While this is a decrease compared to prior quarters, it is consistent with market conditions.

The trading environment for our core lines of insurance business remains competitive and we continue to focus on those lines of business that we believe provide the best return on capital, including the writing of selective new business, and remain committed to taking the underwriting actions necessary to improve our margins.

Reinsurance

For the six months ended June 30, 2015, premium levels are reflective of the highly competitive reinsurance market, as we continued to experience deteriorating rates across most lines and regions during the quarter and into July 1 renewals.

In general, global property catastrophe rates fell approximately 7.5%, other excess of loss covers declined 5% and ceding commissions on pro rata treaties grew by 1.5%. We did see a slower rate of decrease on U.S. property catastrophe and, in particular, significant increased demand in Florida, which led to a number of covers being re-priced or unable to be completed at the initial firm order terms.

The Reinsurance segment continues its disciplined underwriting approach during these very challenging market conditions, and we are encouraged by the pricing discipline emerging in both traditional and insurance-linked securities markets over the last two months.

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4) Market Movement Impacts on Our Investment Portfolio (Excluding Life Funds Withheld Assets)

During the three months ended June 30, 2015, the negative mark to market change of $355.1 million on our available for sale ("AFS") investments was primarily driven by government bond rate increases in all our major jurisdictions. This represents approximately a 0.8% depreciation in the average fair market value of assets for the three months ended June 30, 2015.

The following table provides further detail regarding the movements in relevant credit markets, as well as in government interest rates using selected market indices during the three months ended June 30, 2015:

	Interest Rate Movement for the three months ended June 30, 2015 (1) (‘+’/‘-’ represents increases / decreases in interest rates)	Credit Spread Movement for the three months ended June 30, 2015 (2) (‘+’/‘-’ represents widening / tightening of credit spreads)
United States	+28 basis points (5 year Treasury)	+12 basis points (US Corporate A rated)
		+9 basis points (US Mortgage Master Index)
		+10 basis points (US CMBS, AAA rated)
United Kingdom	+45 basis points (10 year Gilt)	+19 basis points (UK Corporate, AA rated)
Euro-zone	+18 basis points (5 year Bund)	+22 basis points (Europe Corporate, A rated)

____________

(1) Source: Bloomberg Finance L.P.

(2) Source: Merrill Lynch Global Indices.

Net realized gains on investments in the three months ended June 30, 2015 totaled $4.4 million, including net realized gains of $20.9 million from sales of fixed maturities partially offset by net realized losses of approximately $16.6 million related to other than temporary impairments ("OTTI") charges on certain of the Company’s fixed income investments. For further analysis of this, see "Income Statement Analysis - Investment Activities" below.

During the six months ended June 30, 2015, the negative mark to market change of $275.0 million on our AFS investments was primarily driven by government bond rate increases in the United Kingdom and the Euro zone. This represents an approximately 0.6% depreciation in the average fair market value of assets for the six months ended June 30, 2015.

The following table provides further detail regarding the movements in relevant credit markets, as well as in government interest rates using selected market indices during the six months ended June 30, 2015:

	Interest Rate Movement for the six months ended June 30, 2015 (1) (‘+’/‘-’ represents increases / decreases in interest rates)	Credit Spread Movement for the six months ended June 30, 2015 (2) (‘+’/‘-’ represents widening / tightening of credit spreads)
United States	0 basis points (5 year Treasury)	+4 basis points (US Corporate A rated)
		+8 basis points (US Mortgage Master Index)
		+9 basis points (US CMBS, AAA rated)
United Kingdom	+27 basis points (10 year Gilt)	-3 basis points (UK Corporate, AA rated)
Euro-zone	+6 basis points (5 year Bund)	+22 basis points (Europe Corporate, A rated)

____________

(1) Source: Bloomberg Finance L.P.

(2) Source: Merrill Lynch Global Indices.

Net realized gains on investments in the six months ended June 30, 2015 totaled $9.0 million, including net realized gains of $36.1 million from sales of fixed maturities partially offset by net realized losses of approximately $27.2 million related to other than temporary impairments ("OTTI") charges on certain of the Company’s fixed income investments. For further analysis of this, see "Income Statement Analysis - Investment Activities" below.

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OTHER KEY FOCUSES OF MANAGEMENT

We remain focused on, among other things, managing capital, enhancing enterprise risk management capabilities and monitoring regulatory change.  In addition, in connection with the closing of our acquisition of Catlin, we are focused on both successfully integrating our respective businesses, including culture, products, internal controls, procedures and systems, as well as capitalizing on the respective strengths and talents of both organizations.

Catlin Integration

We announced the closing of the Catlin Acquisition on May 1, 2015. Management is highly focused on successfully integrating Catlin and realizing the anticipated synergies associated with this recent significant acquisition. Following the initial announcement of the proposed Catlin Acquisition, management developed a comprehensive integration plan that identifies key areas of focus and action plans in anticipation of closing. Examples of this include the development of proposed operating models and leadership structures, talent management and system and process integration roadmaps for structural and organizational design changes. These efforts have been further broken down into multiple work streams led by an integration steering committee and a project management team that includes colleagues from both organizations. Management, the integration steering committee and the project management team have continued to implement this integration plan since the closing of the Catlin Acquisition.

Capital Management

The management of our capital is fundamental to our business model and our ability to underwrite business.

Buybacks of Ordinary Shares

On February 21, 2014, XL-Ireland announced that its Board of Directors approved an increase to our share buyback program (the "Share Buyback Program"), authorizing the purchase of up to $1.0 billion of our ordinary shares, which included the amounts that remained available for purchase under the previous Share Buyback Program.

We had suspended active share buybacks through the close of the Catlin Acquisition; however, following the close of the Catlin Acquisition, we resumed share buybacks under the Share Buyback Program. During the three and six months endedJune 30, 2015, we purchased and canceled 2.9 million ordinary shares under the Share Buyback Program for $110.0 million. As of June 30, 2015, $157.6 million remained available for purchase under the Share Buyback Program.

On August 6, 2015, we announced that the XL-Ireland Board of Directors approved a new share buyback program, authorizing the purchase of up to $1 billion of our ordinary shares (the “August 2015 Program”). This authorization replaced the approximately $97.6 million remaining under the previous Share Buyback Program.

All share buybacks were carried out by way of redemption in accordance with Irish law and our constitutional documents. All shares so redeemed were canceled upon redemption.

Issuance of the 4.45% Subordinated Debt due March 2025

On March 30, 2015, XL-Cayman issued $500 million of subordinated notes due March 2025, with a fixed coupon of 4.45%, that are guaranteed by XL-Ireland. The securities are listed on the New York Stock Exchange. The notes were issued at 99.633% of the face amount and net proceeds were $492.2 million. Related expenses of the offering amounted to $5.9 million. These costs were deferred and will be amortized over the term of the subordinated notes.

Issuance of the 5.5% Subordinated Debt due March 2045

On March 30, 2015, XL-Cayman issued $500 million of subordinated notes due March 2045, with a fixed coupon of 5.5%, that are guaranteed by XL-Ireland. The securities are listed on the New York Stock Exchange. The notes were issued at 99.115% of the face amount and net proceeds were $488.4 million. Related expenses of the offering amounted to $7.2 million. These costs were deferred and will be amortized over the term of the subordinated notes.

Catlin Acquisition - Bridge Facility

We engaged in capital management activity in support of the Catlin Acquisition. XL-Cayman, as borrower, XL-Ireland, X.L. America, Inc., XLIB, XL Re Ltd, and XL Life Ltd, as guarantors, Morgan Stanley Senior Funding, Inc., as administrative agent, and the lenders party thereto entered into a senior unsecured 364-Day Bridge Loan Agreement providing for a £1.6 billion Bridge Facility (the "Bridge Facility"). On April 8, 2015, we had deposited a sufficient amount of cash, cash equivalents and U.S. government securities in escrow to discharge the cash portion of the Catlin Acquisition. Accordingly, and pursuant to the terms of the Bridge Facility, on that date we terminated the commitments under the Bridge Facility.

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Risk Management

Our risk appetite framework guides our strategies relating to, among other things, capital preservation, earnings volatility, capital at risk, operational loss, liquidity standards, claims paying rating and capital structure. This framework also addresses our tolerance to risks from material individual events (e.g., natural or man- made catastrophes such as terrorism), our investment portfolio and realistic disaster scenarios that cross multiple lines of business (and risks related to some or all of the above that may occur concurrently).

In relation to event risk management, we establish net underwriting limits for individual large events as follows:

1. We impose limits for each natural catastrophe peril region at a 1% tail value at risk (“TVaR”) probability. This statistic indicates the average amount of net loss expected to be incurred if a loss above the 1% exceedance probability level has occurred.

2. For each event type other than natural catastrophes, we impose limits at a 1% exceedance probability. If we were to deploy the full limit, for any given event type, there would be a 1% probability that an event would occur during the next year that would result in a net underwriting loss in excess of the limit.

3. We also impose limits for certain other event types at a 0.4% exceedance probability as described in further detail below. If we were to deploy the full limit, for any such given event type, there would be a 0.4% probability that an event would occur during the next year that would result in a net underwriting loss in excess of the limit.

For planning purposes and to calibrate 2015 risk tolerances, we set our underwriting limits as a percent of June 30, 2015 Adjusted Tangible Capital (“Adjusted Tangible Capital”). Adjusted Tangible Capital is defined as Total Shareholders’ Equity plus (i) outstanding subordinated notes due 2025 and 2045, less (ii) Goodwill and Other Intangible Assets, less (iii) Accumulated Other Comprehensive Income ("AOCI") (excluding certain net balances associated with Life Funds Withheld Assets). These limits may be recalibrated, from time to time, to reflect material changes in Total Shareholders’ Equity that may occur, at the discretion of management and as overseen by the Board.

Tiered risk tolerances are set for natural catastrophes, terrorism, other realistic disaster scenarios, credit risk, country risk, longevity risk and mortality risk. In setting our risk tolerances we consider such factors as:

• Anticipated risk adjusted returns;

• Strategic risk preferences;

• Relativity to peers;

• Shareholder expectations;

• Robustness of exposure assessment methodology; and

• Projected enterprise loss potential.

Per event 1% TVaR underwriting limits for North Atlantic Windstorm are set at a level not to exceed approximately 25% of Adjusted Tangible Capital. Per event 1% TVaR underwriting limits for North American Earthquake are set at a level not to exceed approximately 20% of Adjusted Tangible Capital. Per event 1% TVaR underwriting limits for all other natural catastrophe peril regions are set below the per event 1% TVaR limits described above.

The largest per event 1% exceedance probability underwriting limit for terrorism and other realistic disaster scenarios is set at a level not to exceed approximately 13.5% of Adjusted Tangible Capital; limits at the per event 1% exceedance probability for the remaining terrorism and realistic disaster scenarios are set below this level.

The largest per event 1% exceedance probability underwriting limit for country risk is set at a level not to exceed approximately 7% of Adjusted Tangible Capital.

The largest per event 1% exceedance probability underwriting limit for mortality risk is set at a level not to exceed approximately 6.1% of Adjusted Tangible Capital.

The largest per event 1% exceedance probability underwriting limit for longevity risk is set at a level not to exceed approximately 1.5% of Adjusted Tangible Capital.

The largest per event 0.4% exceedance probability underwriting limit for certain terrorism events is set at a level not to exceed approximately 18% of Adjusted Tangible Capital; limits at the per event 0.4% exceedance probability for the remaining terrorism event scenarios are set below this level.

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The largest per event 0.4% exceedance probability underwriting limit for mortality risk is set at a level not to exceed approximately 8.1% of Adjusted Tangible Capital.

The largest per event 0.4% exceedance probability underwriting limit for longevity risk is set at a level not to exceed approximately 2.0% of Adjusted Tangible Capital.

In all instances, the above referenced underwriting limits reflect pre-tax losses net of reinsurance and include inwards and outwards reinstatement premiums related to the specific events being measured. The limits do not contemplate underwriting profits expected to be generated in the absence of catastrophic loss activity.

In setting underwriting limits, we also consider such factors as:

• Correlation of underwriting risk with other risks (e.g., asset/investment risk, operational risk, etc.);

• Model risk and robustness of data;

• Geographical concentrations;

• Exposures at lower return periods;

• Expected payback period associated with losses;

• Projected share of industry loss; and

• Annual aggregate losses for natural catastrophes at various return periods including a 1% exceedance probability and a 1% TVaR level on both a peril region basis and a portfolio basis.

Also see Item 3, "Quantitative and Qualitative Disclosures About Market Risk - Credit Risk (Excluding Life Funds Withheld Assets)" for a discussion of our credit risk framework which establishes a credit clash limit to manage the direct and indirect credit exposures arising from underwriting and non-underwriting activities that could potentially be impacted in various degress by a systemic credit event.

Loss exposure estimates for all event risks are derived from a combination of commercially available and internally developed models together with the judgment of management, as overseen by the XL-Ireland Board. Actual incurred losses may vary materially from our estimates. Factors that can cause a deviation between estimated and actual incurred losses may include:

• Inaccurate assumptions of event frequency and severity;

• Inaccurate or incomplete data;

• Changing climate conditions that may add to the unpredictability of frequency and severity of natural catastrophes in certain parts of the world and create additional uncertainty as to future trends and exposures;

• Future possible increases in property values and the effects of inflation that may increase the severity of catastrophic events to levels above the modeled levels;

• Natural catastrophe models that incorporate and are critically dependent on meteorological, seismological and other earth science assumptions and related statistical relationships that may not be representative of prevailing conditions and risks, and may therefore misstate how particular events actually materialize, causing a material deviation between forecasted and actual damages associated with such events; and

• A change in the judicial climate.

For the above and other reasons, the incidence, timing and severity of catastrophes and other event types are inherently unpredictable and it is difficult to estimate the amount of loss any given occurrence will generate. As a consequence, there is material uncertainty around our ability to measure exposures associated with individual events and combinations of events. This uncertainty can cause actual exposures and losses to deviate from those amounts estimated, which in turn can create a material adverse effect on our financial condition and results of operations and may result in substantial liquidation of investments, possibly at a loss, and outflows of cash as losses are paid. For this reason, we carry capital in addition to that required by the specific limits described even if it is in excess of rating agency and regulatory required capital.

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The table below, which includes exposures assumed related to the Catlin Acquisition on a combined pro forma basis, shows our estimated per event net 1% and 0.4% exceedance probability exposures for certain peak natural catastrophe peril regions. These estimates assume that amounts due from reinsurance and retrocession purchases are 100% collectible. There may be credit or other disputes associated with these potential receivables.

			1-in-100 Event				1-in-250 Event
Geographical Zone (U.S. dollars in millions)	Peril	Measurement Date of In-Force Exposures (1)	Probable Maximum Loss (2)		Percentage of Adjusted Tangible Capital at June 30, 2015 (3)		Probable Maximum Loss (2)		Percentage of Adjusted Tangible Capital at June 30, 2015 (3)
North Atlantic	Windstorm	April 1, 2015	$	1,891	15.6	%	$	2,773	22.8	%
North America	Earthquake	April 1, 2015	983		8.1	%	1,744		14.3	%
Europe	Windstorm	April 1, 2015	672		5.5	%	830		6.8	%
Japan	Earthquake	April 1, 2015	476		3.9	%	591		4.9	%
Japan	Windstorm	April 1, 2015	344		2.8	%	430		3.5	%

____________

(1) Detailed analyses of aggregated in-force exposures and maximum loss levels are done periodically. The measurement dates represent the date of the last completed detailed analysis by geographical zone.

(2) Probable maximum losses, which include secondary uncertainty that incorporates variability around the expected probable maximum loss for each event, do not represent our maximum potential exposures and are pre-tax.

(3) Adjusted Tangible Capital is defined as Total Shareholders’ Equity plus (i) outstanding subordinated notes due 2025 and 2045 less (ii) Goodwill and Other Intangible Assets and less (iii) Accumulated Other Comprehensive Income (excluding certain net balances associated with Life Funds Withheld Assets).

Regulatory Change

As part of our operational efficiency, management continues to actively monitor and assess the various regulatory initiatives and legislation that impact us or in the future could impact us. For example, management has been focused on Solvency II, which was adopted by the European Parliament in April 2009. This is a European Union directive covering the capital adequacy and risk management of, and regulatory reporting for, European-based (re)insurers, as well as providing for a new supervisory regime for the insurance industry. The Omnibus II directive, which was agreed to by the European Commission, the European Parliament and the Council of Ministers, sets a Solvency II implementation date of January 1, 2016. The Central Bank of Ireland has issued proposed interim guidelines and the Prudential Regulation Authority has issued a supervisory statement on applying the European Insurance and Occupational Pensions Authority ("EIOPA") guidelines for authorized firms to ensure their eventual readiness for Solvency II. See "Business - Regulation," included in Item 1 of our Annual Report on Form 10-K for the year ended December 31, 2014.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

See the discussion of our Critical Accounting Policies and Estimates in "Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates," included in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2014.

VARIABLE INTEREST ENTITIES AND OTHER OFF-BALANCE SHEET ARRANGEMENTS

See the discussion of our variable interest entities and other off-balance sheet arrangements in "Management's Discussion and Analysis of Financial Condition and Results of Operations - Variable Interest Entities ("VIEs") and Other Off-Balance Sheet Arrangements," included in our Annual Report on Form 10-K for the year ended December 31, 2014 and Item 1, Note 12, "Variable Interest Entities," to the Unaudited Consolidated Financial Statements included herein.

SEGMENTS

We are organized into two operating segments: Insurance and Reinsurance. Subsequent to our acquisition of Catlin described in Item 1, Note 3(a), "Acquisition and Disposals - Catlin Acquisition" to the Unaudited Consolidated Financial Statements, the underwriting results of Catlin from the Acquisition Date through June 30, 2015 are included in the Company's Insurance and Reinsurance segments. Our general investment and financing operations are reflected in "Corporate and Other."

Subsequent to our life reinsurance subsidiary transaction described in Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary" to the Unaudited Consolidated Financial Statements, GreyCastle Life Reinsurance (SAC) Ltd ("GCLR") reinsures the majority of our life reinsurance business through 100% quota share reinsurance (the "Life Retro Arrangements"). The results of the life run-off business ("Run-Off Life Operations") are also reported within Corporate and Other.

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We evaluate the performance of both the Insurance and Reinsurance segments based on underwriting profit. Other items of our revenue and expenditure are not evaluated at the segment level for reporting purposes. In addition, we do not allocate investment assets by segment for our P&C operations. Investment assets related to our run-off life operations and certain structured products included in the Insurance and Reinsurance segments are held in separately identified portfolios. As such, net investment income from these assets is included in the contribution from the applicable segment. See Item 1, Note 5, "Segment Information," to the Unaudited Consolidated Financial Statements included herein for a reconciliation of segment data to our Unaudited Consolidated Financial Statements.

INCOME STATEMENT ANALYSIS

Segment Results for the three months ended June 30, 2015 compared to the three months ended June 30, 2014

Insurance

Our Insurance operations provide commercial property, casualty and specialty insurance products on a global basis. Products generally provide tailored coverages for complex corporate risks and include the following lines of business: property, casualty, professional liability, environmental liability, aviation and satellite, marine and offshore energy, equine, fine art and specie, surplus lines, political risk and trade credit, crisis management, surety, cybertech, accident and health and other insurance coverages, including those mentioned above, through our programs, middle market and construction businesses. We focus on those lines of business within our Insurance operations that we believe provide the best return on capital over time. As a result of the Catlin Acquisition, Insurance lines of business are now divided into the following underwriting divisions: Professional Lines ("Professional"), which we previously referred to as Global Professional Lines; Casualty, which includes the casualty business previously included under International Property and Casualty, and North America Property and Casualty; Energy, Property & Construction ("EPC"), which includes the property business previously reported under International Property and Casualty, North America Property and Casualty, and Specialty; and Specialty Lines ("Specialty").

The following table summarizes the underwriting profit (loss) for the Insurance segment:

	Three Months Ended						Percentage
	June 30,						Change
(U.S. dollars in thousands)	2015			2014			2015 to 2014
Gross premiums written	$	2,219,444		$	1,618,405		37.1	%
Net premiums written	1,401,772			996,880			40.6	%
Net premiums earned	1,412,906			1,003,990			40.7	%
Net losses and loss expenses	896,370			627,627			42.8	%
Acquisition costs	181,716			99,863			82.0	%
Operating expenses	292,161			213,930			36.6	%
Underwriting profit (loss)	$	42,659		$	62,570		(31.8	)%
Net results – structured products	3,401			31,645			(89.3	)%
Net fee income and other (expense)	(2,033		)	(3,567		)	(43.0	)%

Gross Premiums Written

The following table summarizes our gross premiums written by underwriting division for the Insurance segment:

	Three Months Ended				Percentage
	June 30,				Change
(U.S. dollars in thousands)	2015		2014		2015 to 2014
Professional	$	462,133	$	406,164	13.8	%
Casualty	790,227		700,780		12.8	%
EPC	530,432		267,921		98.0	%
Specialty	436,652		243,540		79.3	%
Total	$	2,219,444	$	1,618,405	37.1	%

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Gross premiums written increased by 37.1%, primarily due to the Catlin Acquisition. The acquired businesses' portfolio experienced some reductions in renewals in Professional and EPC where premium rates did not support our target returns. However, retention of business was strong where premium rates were deemed to be adequate.

When evaluated in local currency, our gross premiums written increased by 44.1%. The unfavorable foreign exchange on our gross premiums written was mainly due to the weakening of the Euro against the U.S. dollar, impacting businesses written in these currencies.

Overall, excluding the impacts of the Catlin Acquisition and foreign exchange, our gross premiums written increased by 1.1%.

The following is a summary of the premium movements by underwriting division:

▪ Professional - increase of 13.8% is mainly driven by the Catlin Acquisition. Excluding the impact of the acquired business, the division experienced an increase of 1.9% due to increases in renewals in our cybertech, international financial lines and North American businesses, as well as new business and favorable pricing in cybertech, partially offset by decreases in new business within our select professional and international financial lines businesses.

▪ Casualty - increase of 12.8% is largely attributable to the Catlin Acquisition. Excluding the impact of the acquired business, the division experienced a decrease of 5.2% which is largely attributable to adverse foreign exchange rates in international casualty due to the weakening of the Euro against the U.S. dollar and lower pricing in several business lines, partially offset by increased renewals in North American construction casualty, excess casualty and global risk management.

▪ EPC - increase of 98.0% is due to the Catlin Acquisition. Excluding the impact of the acquired business, the division experienced a decrease of 13.1% which is mainly attributable to adverse foreign exchange rates in international property and international construction, as well as decreases in renewals in energy business and North American property and decreases in new business in international property, North American property and international construction.

▪ Specialty - increase of 79.3% is mainly attributable to the Catlin Acquisition. Excluding the impact of the acquired business, the division experienced a decrease of 0.2% due to decreases in renewals in fine art and specie and lower pricing in several business lines, partially offset by new business in marine.

Net Premiums Written

The increase of 40.6% largely resulted from the increase in gross written premiums due to the Catlin Acquisition, plus an additional increase mainly due to a decrease in ceded premiums due to favorable pricing and the non-renewal of certain reinsurance programs.

Net Premiums Earned

The increase of 40.7% is attributable to the increase in net premiums written as noted above.

Net Losses and Loss Expenses

Combined Ratio

The following table presents the ratios for the Insurance segment:

	Three Months Ended				Percentage
	June 30,				Point Change
	2015		2014		2015 to 2014
Loss and loss expense ratio	63.4	%	62.5	%	0.9
Acquisition expense ratio	12.9	%	9.9	%	3.0
Operating expense ratio	20.7	%	21.4	%	(0.7	)
Underwriting expense ratio	33.6	%	31.3	%	2.3
Combined ratio	97.0	%	93.8	%	3.2

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The loss and loss expense ratio includes net losses incurred for both the reported year and any favorable or adverse prior year development of loss and loss expense reserves held at the beginning of the year. The following table summarizes these components of the loss ratio for the Insurance segment for the three months ended June 30, 2015 and 2014:

	Three Months Ended				Percentage
	June 30,				Point Change
	2015		2014		2015 to 2014
Loss and loss expense ratio	63.4	%	62.5	%	0.9
Prior year reserve development	2.7	%	3.7	%	(1.0	)
Loss ratio excluding prior year development	66.1	%	66.2	%	(0.1	)

Loss Ratio - excluding prior year development

The 0.1 percentage point decrease in the loss ratio excluding prior year development represents no significant variance for the three months ended June 30, 2015 as compared to the prior year period. Losses net of reinsurance recoveries and reinstatement premiums related to natural catastrophe events for the three months ended June 30, 2015 were $44.9 million higher than in the same period of 2014. Excluding favorable prior year development, net natural catastrophe losses and related reinstatement premiums in both quarters, the loss ratio for the three months ended June 30, 2015 compared to the same period of 2014 decreased by 2.8 percentage points to 61.9% due to lower levels of attritional losses in both legacy and acquired businesses, as well as the amortization of fair value adjustments made as a result of the Catlin Acquisition.

Prior Year Development

The following table summarizes the net (favorable) adverse prior year development by line of business relating to the Insurance segment for the three months ended June 30, 2015 and 2014:

	Three Months Ended
	June 30,
(U.S. dollars in thousands)	2015			2014
Professional	$	5,328		$	2,846
Casualty	(10,355		)	37,572
Property	362			(10,288		)
Specialty	(40,032		)	(44,536		)
Other (1)	6,562			(22,587		)
Total	$	(38,135	)	$	(36,993	)

____________

(1)    Other includes programs, excess and surplus, surety, structured indemnity and certain discontinued lines.

Net favorable prior year reserve development of $38.1 million was attributable to the following:

• For Professional lines, net prior year development was $5.3 million unfavorable predominantly as a result of worse than expected loss experience reported in the core U.S. and select books that drove deteriorations of $40.2 million and $15.8 million, respectively. This was partially offset by reductions of $34.5 million in the core Bermuda book and $15.6 million in the design book due mainly to better than expected loss experience reported on the 2008 and 2010 report years, respectively.

• For Casualty lines, net prior year development was $10.4 million favorable. This was primarily due to a reduction of $17.8 million in the Bermuda excess casualty lines mainly as a result of reflecting the better than expected loss experience reported across most accident years. This reduction was partially offset by a deterioration of $7.5 million in the global risk management lines driven by worse than expected loss experience primarily on the 2011 to 2013 accident years.

• For EPC lines, net prior year development was $0.4 million unfavorable.

• For Specialty lines, net prior year development was $40.0 million favorable driven by a release of $18.8 million in the discontinued Bermuda political risk portfolio arising predominantly from the favorable settlement of a loss on the 2009 accident year and the lapse of the exposure for this account. There were further reductions of $11.7 million in the marine book and $5.7 million in fine art and specie to reflect better than expected loss experience reported across the 2009 to 2013 and 2014 accident years, respectively.

• For other lines, net prior year development was $6.6 million unfavorable due primarily to a $5.0 million deterioration in the discontinued surety book relating to reinsurance bad debt.

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Underwriting Expense Ratio

The increase of 2.3 percentage points was due to an increase in the acquisition expense ratio of 3.0 percentage points, partially offset by a decrease in the operating expense ratio of 0.7 percentage points, as follows:

▪ Acquisition expense ratio - increase mainly attributable to the EPC business acquired from Catlin, whose acquisition ratio was higher than the ratio in our legacy business mix.

▪ Operating expense ratio - decreased as a result of initial synergies realized from the Catlin Acquisition.

Net Results - Structured Products

Net results from structured insurance products, decreased 89.3% to $3.4 million from the prior year quarter result of $31.6 million. The results include net investment income of $8.2 million and $7.9 million for the three months ended June 30, 2015 and 2014, respectively, and interest expense (credit) of $4.8 million and $(23.8) million, for the three months ended June 30, 2015 and 2014, respectively. The decrease in the net results from the prior year quarter was mainly due to the negotiated termination of one of our larger structured indemnity contracts in the prior year. This contract had previously been designated as part of a fair value hedge with a remaining fair value adjustment of $47.0 million that was being amortized as a reduction of interest expense over the remaining term of the contract. As a result of the termination, a net decrease of $28.7 million was recorded to interest expense reflecting the accretion rate adjustment due to changes in cash flows and the realization of the full remaining balance of the fair value hedge adjustment, resulting in a net credit to interest expense.

For further information about our structured indemnity contracts that are accounted for as deposit contracts, see Item 8, Note 12, "Deposit Liabilities," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

Net Fee Income and Other

The decrease compared to the same period of 2014 in net fee income and other was driven by Specialty discontinued business lines.

Reinsurance

The Reinsurance segment provides casualty, property risk, property catastrophe, marine, aviation and other specialty reinsurance on a global basis, with business being written on both a proportional and non-proportional treaty basis and also on a facultative basis. As a result of the acquisition of Catlin, our reinsurance operations are structured into five geographical regions: Bermuda, North America, London, Europe and Middle East North Africa ("MENA"), and Emerging Markets. Emerging Markets includes Asia Pacific and Latin America. London, Europe and MENA and Emerging Markets were previously reported together as International.

The following table summarizes the underwriting profit (loss) for the Reinsurance segment:

	Three Months Ended				Percentage
	June 30,				Change
(U.S. dollars in thousands)	2015		2014		2015 to 2014
Gross premiums written	$	782,248	$	493,124	58.6	%
Net premiums written	698,301		436,446		60.0	%
Net premiums earned	650,889		434,086		49.9	%
Net losses and loss expenses	254,825		200,253		27.3	%
Acquisition costs	158,217		80,874		95.6	%
Operating expenses	71,727		47,582		50.7	%
Underwriting profit (loss)	$	166,120	$	105,377	57.6	%
Net results – structured products	1,856		3,240		(42.7	)%
Net fee income and other	623		664		(6.2	)%

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Gross Premiums Written

The following table summarizes our gross premiums written by region for the Reinsurance segment:

	Three Months Ended				Percentage
	June 30,				Change
(U.S. dollars in thousands)	2015		2014		2015 to 2014
Bermuda	$	398,535	$	268,586	48.4	%
North America	181,659		96,156		88.9	%
London	90,243		32,004		N/M
Europe and MENA	45,302		58,025		(21.9	)%
Emerging markets	66,509		38,353		73.4	%
Total	$	782,248	$	493,124	58.6	%

Gross premiums written increased by 58.6%, primarily driven by the Catlin Acquisition. The acquired businesses' portfolio experienced a reduction from prior year due to rate reductions and also due to significant multi-year contracts written in the prior year which did not repeat in the current year.

When evaluated in local currency, our gross premiums written increased by 60.2%. The unfavorable foreign exchange on our gross premiums written was mainly due to the weakening of the Euro against the US dollar, impacting European business written in this currency.

Overall, excluding the impacts of the Catlin Acquisition and foreign exchange, our gross premiums written decreased by 1.4%.

The following is a summary of the premium movements by region:

▪ Bermuda - increase of 48.4% due to the Catlin Acquisition. Excluding the impact of the acquired business, the region experienced a decrease of 4.3% mainly driven by lower property catastrophe renewals due to rate reductions.

▪ North America - increase of 88.9% largely attributable to the Catlin Acquisition. Excluding the impact of the acquired business, the region experienced an increase of 28.7% as a result of a large new casualty quota share.

▪ London - significant increase is a result of the Catlin Acquisition. Excluding the impact of the acquired business, the region experienced an increase of 10.0% mainly driven by premium adjustments on prior incepting casualty policies and new property facultative business.

▪ Europe and MENA - decrease of 21.9% is mainly attributable to the adverse effects of foreign exchange as noted above, plus lower property catastrophe renewals due to rate reductions, lower reinstatement premiums, and premium adjustments on prior incepting casualty policies.

▪ Emerging markets - increase of 73.4% due to the Catlin Acquisition. Excluding the impact of the acquired business, the region experienced a decrease of 45.8%, which is a result of estimated premium reductions in Asia on the 2014 underwriting year for property treaty in the current quarter, and unfavorable renewals in Latin America.

Net Premiums Written

The increase of 60.0% resulted from the gross written premium increases as outlined above, plus a decrease in ceded premiums due to premium adjustments on an agricultural program in the prior year which did not repeat in the current year.

Net Premiums Earned

The increase of 49.9% is mainly attributable to the increase in net premiums written as outlined above, partially offset by the overall earn through of lower gross written premiums in the current year in our legacy businesses.

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Net Losses and Loss Expenses

Combined Ratio

The following table presents the ratios for the Reinsurance segment:

	Three Months Ended				Percentage
	June 30,				Point Change
	2015		2014		2015 to 2014
Loss and loss expense ratio	39.2	%	46.1	%	(6.9	)
Acquisition expense ratio	24.3	%	18.6	%	5.7
Operating expense ratio	11.0	%	11.0	%	—
Underwriting expense ratio	35.3	%	29.6	%	5.7
Combined ratio	74.5	%	75.7	%	(1.2	)

The loss and loss expense ratio includes net losses incurred for both the reported year and any favorable or adverse prior year development of loss and loss expense reserves held at the beginning of the year. The following table summarizes these components of the loss ratio for the Reinsurance segment for the three months ended June 30, 2015 and 2014:

	Three Months Ended				Percentage
	June 30,				Point Change
	2015		2014		2015 to 2014
Loss and loss expense ratio	39.2	%	46.1	%	(6.9	)
Prior year reserve development	10.8	%	11.0	%	(0.2	)
Loss ratio excluding prior year development	50.0	%	57.1	%	(7.1	)

Loss Ratio - excluding prior year development

The 7.1 percentage point decrease in the loss ratio excluding prior year development was primarily as a result of lower levels of attritional and catastrophe losses in the three months ended June 30, 2015 as compared to the prior year period. Losses net of reinsurance recoveries and reinstatement premiums related to natural catastrophe events for the three months ended June 30, 2015 were $19.7 million lower than in the same period of 2014. Excluding favorable prior year development, net natural catastrophe losses and related reinstatement premiums in both quarters, the loss ratio for the three months ended June 30, 2015 compared to the same period of 2014 decreased by 2.3 percentage points to 50.0% due to lower levels of attritional losses in the acquired businesses plus the amortization of fair value adjustments made as a result of the Catlin Acquisition, partially offset by higher attritional losses and deterioration in rate levels in our legacy businesses.

Prior Year Development

The following table summarizes the net (favorable) adverse prior year development by line of business relating to the Reinsurance segment for the three months ended June 30, 2015 and 2014:

	Three Months Ended
	June 30,
(U.S. dollars in thousands)	2015			2014
Property and other short-tail lines	$	(44,003	)	$	(20,088	)
Casualty and other long-tail lines	(26,732		)	(27,368		)
Total	$	(70,735	)	$	(47,456	)

Net favorable prior year reserve development of $70.7 million for the three months ended June 30, 2015 was mainly attributable to the following:

▪ Net favorable prior year development for the short-tail lines totaled $44.0 million. Details of the significant components are as follows:

▪ For property catastrophe lines, net prior year development was $9.1 million favorable due to better than expected development on attritional losses mainly in Europe and a reduction on a 2012 storm being partially offset by a strengthening on 2010 and 2011 catastrophe losses.

▪ For property other lines, net prior year development was $34.3 million favorable driven primarily by better than expected development on attritional losses in the North America, Europe and Asia Pacific books being partially offset by worse than expected development on attritional losses in Latin America.

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▪ For marine and aviation lines, net prior year development was $0.6 million favorable.

▪ Net favorable prior year development for the long-tail lines totaled $26.7 million and details of the significant components are as follows:

• For casualty lines, net prior year development was $15.4 million favorable due to better than expected development on attritional losses in North America and London.    

• For other lines, net prior year development was $11.3 million favorable due to better than expected development on attritional losses mainly in Bermuda and North America.

Underwriting Expense Ratio

The increase of 5.7 percentage points was driven by an increase in acquisition expenses due to the amortization of fair value adjustments recognized as a result of the Catlin Acquisition. Additionally, we experienced increases in commissions in Asia and Bermuda as a result of adding the acquired businesses to our prior business mix.

Net Results - Structured Products

Net results from structured reinsurance products decreased 42.7% to $1.9 million from the prior year quarter result of $3.2 million. The results include net investment income of $7.9 million and $9.1 million for the three months ended June 30, 2015 and 2014, respectively, and interest expense of $5.9 million and $5.6 million and operating expenses of $0.2 million and $0.2 million, for the three months ended June 30, 2015 and 2014, respectively. The decrease in the net results from the prior year quarter was mainly due to a reduction in investment income resulting from a lower asset base, reflecting the run-off nature of the business.

For further information about our structured indemnity contracts that are accounted for as deposit contracts see Item 8, Note 12, "Deposit Liabilities," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

Corporate and Other (including Run-Off Life operations)

Our general investment and financing operations are reflected in Corporate and Other. In addition, results of our Run-Off Life Operations are reported within Corporate and Other. We ceased writing new life reinsurance contracts in 2009 and since that time have been managing the run-off of our life reinsurance operations.

Run-Off Life Operations

On May 1, 2014, XLIB entered into a sale and purchase agreement with GreyCastle providing for the sale of 100% of the common shares of XLIB's life reinsurance subsidiary, XLLR. As a result, we have ceded the majority of our life reinsurance business to GCLR through the Life Retro Arrangements. This transaction covers a substantial portion of our life reinsurance reserves.

Subsequent to the transaction, we no longer consider our Life operations to be a separate operating segment, and the results of the Run-Off Life Operations are reported within Corporate and Other. For a further discussion, see Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," to the Unaudited Consolidated Financial Statements included herein.

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Impact of Life Retro Arrangements

Subsequent to the completion of the sale of our life reinsurance subsidiary XLLR, as described in Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," to the Unaudited Consolidated Financial Statements included herein, the impact of the Life Retro Arrangements on the Company's results for the three months ended June 30, 2015 was as follows:

Impact of Life Retro Arrangements	Three months ended June 30,
(U.S. dollars in thousands)	2015			2014
Underwriting profit (loss)	$	—		$	—
Net investment income - Life Funds Withheld Assets	46,864			19,165
Net realized gains (losses) on investments sold - Life Funds Withheld Assets	68,037			624
Net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets	(19,543		)	—
OTTI on investments - Life Funds Withheld Assets	(2,878		)	(8,771		)
Exchange (gains) losses	(18,370		)	—
Other income and expenses	3,773			(19		)
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	239,174			(17,546		)
Net income (loss)	$	317,057		$	(6,547	)
Change in net unrealized gains (losses) on investments - Life Funds Withheld Assets, net of tax	(321,046		)	12,297
Change in adjustments related to future policy benefit reserves, net of tax	26,328			—
Change in cumulative translation adjustment - Life Funds Withheld Assets, net of tax	(22,339		)	(5,750		)
Total changes to other comprehensive income as a result of Life Retro Arrangements	$	(317,057	)	$	6,547
Comprehensive income (loss)	$	—		$	—

As shown in the table above, although our net income (loss) is subject to variability related to the Life Retro Arrangements, there is minimal net impact on the Company's comprehensive income in any period. For further information on the life retrocession embedded derivative, see Item 1, Note 7(d)(iii), "Derivative Instruments - Other Non-Investment Derivatives - Credit Exposure," to the Unaudited Consolidated Financial Statements included herein.

Run-Off Life Operations - not subject to Life Retro Arrangements

During the three months ended June 30, 2015, our net underwriting result from our Run-Off Life Operations not subject to Life Retro Arrangements ("Run-Off Life Operations - not subject to Life Retro Arrangements") was a loss of $5.4 million and our net investment result relating to our Run-Off Life Operations - not subject to Life Retro Arrangements, including net realized gains and losses, was $11.0 million, producing a net income of $5.6 million.

Investment Performance (Excluding Life Funds Withheld Assets)

We manage our fixed income portfolio in accordance with investment guidelines approved by the Risk and Finance Committee of the Board of Directors of XL-Ireland. The following is a summary of the investment portfolio returns, which are calculated by dividing the sum of gross investment income or net income from investment affiliates, realized gains (losses) and unrealized gains (losses) by the average market value of the portfolio, for each of our fixed income and non-fixed income portfolios, for the three months ended June 30, 2015 and 2014:

	Three Months Ended
	June 30,
	2015		2014
Total Return on Investments (1)	(0.5	)%	1.9	%
Other Portfolios (2)
Alternative portfolio (3)	2.1	%	1.5	%
Equity portfolio	0.3	%	5.6	%

___________

(1) The performance of investment portfolios is measured on a local currency basis and is not annualized. For the aggregate performance calculation, respective local currency balances are translated to U.S. dollars using quarter end exchange rates to calculate composite portfolio results. Performance represents the P&C operations and Run-Off Life Operations for the three months ended June 30, 2015 and the two months ending June 30, 2014.

(2) Performance on Other Portfolios is included in the Total Return on Investments.

(3) Performance on the alternative portfolio reflects the three months ended May 31, 2015 and 2014, respectively for both equity and non-equity alternative funds.

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Investment Activities (Excluding Life Funds Withheld Assets)

The following table illustrates net investment income, net income from investment fund affiliates, net realized gains (losses) on investments and net realized and unrealized gains (losses) on derivative instruments for the three months ended June 30, 2015 and 2014:

	Three Months Ended				Percentage
	June 30,				Change
(U.S. dollars in thousands)	2015		2014		2015 to 2014
Net investment income (1)	$	176,340	$	213,608	(17.4	)%
Net income (loss) from investment fund affiliates (2)	31,377		17,683		77.4	%
Net realized gains (losses) on investments	4,351		80,844		(94.6	)%
Net realized and unrealized gains (losses) on derivative instruments	48,509		11,599		N/M

____________

(1) Net investment income includes: Net investment income - excluding Life Funds Withheld Assets and net investment income related to the net results from structured products.

(2) We generally record the income related to alternative fund affiliates on a one-month lag and the private investment fund affiliates on a three-month lag based upon the availability of the information provided by the investees.

* N/M - Not Meaningful

Net Investment Income

The decrease of 17.4% was primarily due to the impact of the Life Retro Arrangements effective May 30, 2014, since all of the investment results associated with the Life Funds Withheld Assets for the three months ended June 30, 2015 accrued to GCLR. For further information on the Life Retro Arrangements see Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," to the Unaudited Consolidated Financial Statements included herein.

In addition, a reduction in investment yields as a result of lower reinvestment rates contributed to the net investment income decrease. We estimate that approximately $4.1 billion of assets with an average gross book yield of 2.4% will mature and pay down over the next 12 months compared to the average new money rate in the three months ended June 30, 2015 on our portfolio of 1.2%.

Net Income (Loss) from Investment Fund Affiliates

Net income from investment fund affiliates includes earnings from our investments in closed-end investment funds and partnerships and similar vehicles that are accounted for under the equity method.

Performance for the three months ended June 30, 2015 was strong and considerably higher than the same period of 2014. Alternative investment fund returns were strong and modestly exceeded the prior year quarter's positive results, driven principally by fundamental strategies. Private investment fund returns were strongly positive and substantially higher in the quarter than the prior year quarter's results.

Net Realized Gains and Losses on Investments

Net realized gains of $4.4 million in the three months ended June 30, 2015 included the following:

▪ Net realized gains of $20.9 million resulted primarily from sales of U.S. Government and Government Related fixed maturities and equities, partially offset by losses in corporate securities.

▪ Realized losses of approximately $16.6 million related to the OTTI write-down of certain of our available for sale ("AFS") investments. The main components of the net impairment charges were:

• $6.5 million related to certain Other Investments that we no longer intend to hold for a period sufficient to recover their fair value to amortized cost.

• $4.8 million related to certain high yield securities that we no longer intend to hold for a period sufficient to recover their fair value to amortized cost.

• $4.0 million related to certain Alternatives that were in a loss position for more than 11 months.

• $0.3 million related to certain equities that were in a loss position for more than 11 months.

• $0.2 million for structured securities, principally non-Agency residential mortgage-backed securities ("RMBS"), where we determined that the likely recovery on these securities was below the carrying value and, accordingly, recorded an impairment of the securities to the discounted value of the cash flows expected to be received on these securities.

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• $0.8 million related to foreign exchange losses.

Net realized gains on investments of $80.8 million in the three months ended June 30, 2014 included realized losses of $24.6 million related to the write-down of certain of our structured securities and medium term notes with respect to which we determined that there was an other-than-temporary decline in the value of those investments, as well as net realized gains of $105.5 million.

Net Realized and Unrealized Gains and Losses on Derivative Instruments

Net realized and unrealized gains on derivative instruments of $48.5 million in the three months ended June 30, 2015 resulted from our investment strategy to manage interest rate risk, foreign exchange risk and credit risk, and to replicate permitted investments and other hedging activities. As part of our strategy to manage discrete foreign exchange risk associated with the Catlin Acquisition, certain foreign exchange contracts were entered into and other hedging strategies were modified. Upon the closing of the Catlin Acquisition, these contacts were settled and the hedging strategies terminated. Net realized and unrealized gains on derivative instruments for the three months ended June 30, 2015 include $57.0 million from the Catlin Acquisition-related foreign exchange contracts and hedging strategies. For a further discussion, see Item 1, Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements included herein.

Other Revenues and Expenses

The following table sets forth our other revenues and expenses for the three months ended June 30, 2015 and 2014:

	Three Months Ended					Percentage
	June 30,					Change
(U.S. dollars in thousands)	2015		2014			2015 to 2014
Net income (loss) from operating affiliates (1)	$	9,462	$	27,738		(65.9	)%
Gain on sale of operating affiliate	340,407		—			N/M
Exchange (gains) losses	10,374		21,141			(50.9	)%
Corporate operating expenses	130,987		56,495			N/M
Loss on sale of life reinsurance subsidiary	—		666,423			N/M
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	239,174		(17,546		)	N/M
Interest expense (2)	39,038		32,284			20.9	%
Income tax expense (benefit)	32,959		(5,654		)	N/M

____________

(1) The Company generally records the income related to certain operating affiliates on a three-month lag based upon the availability of the information provided by the investees.

(2) Interest expense includes costs related to our debt and collateral facilities and does not include deposit liability accretion, which is included in Net investment results - structured products.

* N/M - Not Meaningful

Net Income (Loss) from Operating Affiliates

The following table sets forth the net income (loss) from operating affiliates for the three months ended June 30, 2015 and 2014:

	Three Months Ended				Percentage
	June 30,				Change
(U.S. dollars in thousands)	2015		2014		2015 to 2014
Net income (loss) from investment manager affiliates	$	8,524	$	13,147	(35.2	)%
Net income (loss) from strategic operating affiliates	938		14,591		(93.6	)%
Net income (loss) from operating affiliates	$	9,462	$	27,738	(65.9	)%

Net Income from Investment Manager Affiliates

The decrease of 35.2% principally reflects more moderate incentive fee earnings from several investment manager affiliates in the current quarter relative to the prior year quarter.

Net Income from Strategic Operating Affiliates

The decrease of 93.6% was largely due to the removal of an insurance affiliate that writes direct U.S. homeowners insurance as a result of the sale of ARX as noted in Item 1, Note 3(b), "Acquisition and Disposals - Sale of Operating Affiliate."

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Exchange Gains and Losses

The foreign exchange losses of $10.4 million in the three months ended June 30, 2015 were a result of an overall weakening of the U.S. dollar against all of our major currency exposures, most notably the U.K. sterling. In the three months ended June 30, 2014, foreign exchange losses of $21.1 million were a result of an overall weakening of the value of the U.S. dollar against most of our major currency exposures, particularly the U.K. sterling, the Euro and the Swiss Franc.

Corporate Operating Expenses

The significant increase was primarily due to costs associated with the Catlin Acquisition as noted in Item 1, Note 3(a), "Acquisition and Disposals - Catlin Acquisition." and "Significant Items Affecting the Results of Operations."

Net Realized and Unrealized Gains and Losses on Life Retrocession Embedded Derivative and Derivative Instruments - Life Funds Withheld Assets

The Company has entered into Life Retro Arrangements as described in Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," to the Unaudited Consolidated Financial Statements included herein. The embedded derivative is recorded at fair value with changes in fair value recognized in earnings through "Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets." For a further discussion, see Item 1, Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements included herein and "Impact of Life Retro Arrangements" above.

Interest Expense

The increase of 20.9% was a result of the overall increase in our debt due to the issuance of subordinated notes in March 2015 and the liabilities assumed from the Catlin Acquisition. For further information about our debt financing, see Item 8, Note 15, "Notes Payable and Debt and Financing Arrangements," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014 and Item 1, Note 10, "Notes Payable and Debt and Financing Arrangements," to the Unaudited Consolidated Financial Statements included herein.

Income Tax Expense

A tax charge of $33.0 million and a tax benefit $5.7 million were incurred in the three months ended June 30, 2015 and 2014, respectively. The tax charges recognized in these periods reflect the combination of our expected full year effective tax rate applicable to each of the years, applied to our operating income in the respective periods, and the tax calculated on non-operating items. Non-operating items primarily include the gain on the sale of ARX and the respective gains and losses on investments and derivative instruments, which are accounted for discretely at the applicable tax rate in the jurisdiction in which they are recognized.

As a result of the Catlin Acquisition, the expected full year effective tax rate applicable to current year to date operating income has been determined using a single rate approach taking into account the full year expected results, including the post-acquisition results of the acquired businesses.

Segment Results for the six months ended June 30, 2015 compared to the six months ended June 30, 2014

Insurance

The following table summarizes the underwriting profit (loss) for the Insurance segment:

	Six Months Ended						Percentage
	June 30,						Change
(U.S. dollars in thousands)	2015			2014			2015 to 2014
Gross premiums written	$	3,874,191		$	3,189,331		21.5	%
Net premiums written	2,490,880			2,124,247			17.3	%
Net premiums earned	2,375,212			1,996,430			19.0	%
Net losses and loss expenses	1,513,317			1,266,820			19.5	%
Acquisition costs	262,103			204,863			27.9	%
Operating expenses	500,618			416,983			20.1	%
Underwriting profit (loss)	$	99,174		$	107,764		(8.0	)%
Net results – structured products	6,306			36,535			(82.7	)%
Net fee income and other (expense)	(9,498		)	(4,779		)	98.7	%

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Gross Premiums Written

The following table summarizes our gross premiums written by underwriting division for the Insurance segment:

	Six Months Ended				Percentage
	June 30,				Change
(U.S. dollars in thousands)	2015		2014		2015 to 2014
Professional	$	803,846	$	739,318	8.7	%
Casualty	1,559,329		1,390,964		12.1	%
EPC	789,127		556,725		41.7	%
Specialty	721,889		502,324		43.7	%
Total	$	3,874,191	$	3,189,331	21.5	%

Gross premiums written increased by 21.5%, primarily due to the Catlin Acquisition. The acquired businesses' portfolio experienced some reductions in renewals in Professional and EPC where premium rates did not support our target returns. However, retention of business was strong where premium rates were deemed to be adequate.

When evaluated in local currency, our gross premiums written increased by 27.7%. The unfavorable foreign exchange on our gross premiums written was mainly due to the weakening of the Euro against the U.S. dollar, impacting businesses written in these currencies.

Overall, excluding the impacts of the Catlin Acquisition and foreign exchange, our gross premiums written increased by 5.9%.

The following is a summary of the premium movements by underwriting division:

▪ Professional - increase of 8.7% driven mainly by the Catlin Acquisition. Excluding the impact of the acquired business, the division experienced an increase of 2.2% due to new business in cybertech and international financial lines, as well as increased pricing and renewals in cybertech, partially offset by decreases in pricing in North America and Bermuda. The acquired Catlin business also experienced decreases in premium during the current year, mainly due to decreases in renewals in international financial lines

▪ Casualty - increase of 12.1% largely driven by the Catlin Acquisition. Excluding the impact of the acquired business, the division experienced an increase of 3.0% which is largely attributable to new business and increases in renewals in global risk management, North American construction casualty, casualty excess and surplus, and an increase in renewals in North American excess casualty, partially offset by adverse foreign exchange in international casualty as noted above.

▪ EPC - increase of 41.7% largely attributable to the Catlin Acquisition. Excluding the impact of the acquired business, the division experienced a decrease of 11.7% which is mainly attributable to adverse foreign exchange affecting international property and international construction as noted above. Additionally contributing to the adverse variance are decreases in pricing in international property and North American property and a decrease in renewals in energy. The acquired Catlin business also experienced a decrease in premiums during the current year as a result of decreases in renewal premiums in energy business, mainly due to decreases in pricing.

▪ Specialty - increase of 43.7% due to the Catlin Acquisition. Excluding the impact of the acquired businesses, the division experienced an increase of 5.1% mainly due to new business in marine, partially offset by a decrease in renewals in fine arts and specie.

Net Premiums Written

The increase of 17.3% largely resulted from the increase in gross premiums written due to the Catlin Acquisition as noted above, partially offset by higher ceded premiums, which is largely attributable to a modification of our reinsurance structure within our international casualty business line to one that utilizes proportional reinsurance in order to take advantage of favorable market terms offset in part by favorable pricing in certain reinsurance programs in EPC.

Net Premiums Earned

The increase of 19.0% is mainly attributable to the increase in net premiums written due to the Catlin Acquisition as noted above. This increase was partially offset due to adverse foreign exchange.

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Net Losses and Loss Expenses

Combined Ratio

The following table presents the ratios for the Insurance segment:

	Six Months Ended				Percentage
	June 30,				Change
	2015		2014		2015 to 2014
Loss and loss expense ratio	63.7	%	63.5	%	0.2
Acquisition expense ratio	11.0	%	10.3	%	0.7
Operating expense ratio	21.1	%	20.8	%	0.3
Underwriting expense ratio	32.1	%	31.1	%	1.0
Combined ratio	95.8	%	94.6	%	1.2

The loss and loss expense ratio includes net losses incurred for both the reported year and any favorable or adverse prior year development of loss and loss expense reserves held at the beginning of the year. The following table summarizes these components of the loss ratio for the Insurance segment for the six months ended June 30, 2015:

	Six Months Ended				Percentage
	June 30,				Change
	2015		2014		2015 to 2014
Loss and loss expense ratio	63.7	%	63.5	%	0.2
Prior year reserve development	1.9	%	2.2	%	(0.3	)
Loss ratio excluding prior year development	65.6	%	65.7	%	(0.1	)

Loss Ratio - excluding prior year development

The 0.1% percentage point decrease in the loss ratio excluding prior year development was primarily as a result of lower levels of medium and large loss events in the six months ended June 30, 2015 as compared to the prior year period. Losses net of reinsurance recoveries and reinstatement premiums related to natural catastrophe events for the six months ended June 30, 2015 were $42.4 million higher than in the same period in 2014. Excluding favorable prior year development, net natural catastrophe losses and related reinstatement premiums in both quarters, the loss ratio for the six months ended June 30, 2015 compared to the same period of 2014 decreased by 1.7 percentage points to 62.4% due to lower levels of attritional losses in both legacy and acquired businesses, as well as the amortization of fair value adjustments made as a result of the Catlin Acquisition.

Prior Year Development

The following table summarizes the net (favorable) adverse prior year reserve development by line of business relating to the Insurance segment for the six months ended June 30, 2015 and 2014:

	Six Months Ended
	June 30,
(U.S. dollars in thousands)	2015			2014
Professional	$	7,000		$	1,620
Casualty	(14,919		)	39,274
Property	(1,214		)	(25,967		)
Specialty	(41,531		)	(39,563		)
Other (1)	6,532			(20,691		)
Total	$	(44,132	)	$	(45,327	)

____________

(1) Other includes programs, excess and surplus, surety, structured indemnity and certain discontinued lines.

Net favorable prior year development of $44.1 million was mainly attributable to the following:

▪ For professional lines, net prior year development was $7.0 million unfavorable primarily as a result of worse than expected loss experience reported in the core U.S. and select businesses that drove deteriorations of $40.5 million and $15.8 million respectively. This was partially offset by reductions of $34.8 million in the core Bermuda book and $15.5 million in the design book due mainly to better than expected loss experience reported on the 2008 and 2010 report years respectively.

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▪ For casualty lines, net prior year development was $14.9 million favorable. This was driven by a reduction of $17.4 million in the Bermuda excess casualty lines mainly as a result of reflecting the better than expected loss experience reported across most accident years. This reduction was partially offset by a deterioration of $7.5 million in the global risk management lines driven by worse than expected loss experience primarily on the 2011 to 2013 accident years.

▪ For property lines, net prior year development was $1.2 million unfavorable.

▪ For specialty lines, net prior year development was $41.5 million favorable driven by a release of $18.8 million in the discontinued Bermuda political risk portfolio arising predominantly from the favorable settlement of a loss on the 2009 accident year and the lapse of the exposure for this account. There were further reductions of $12.4 million in the marine book and $5.8 million in fine art and specie to reflect better than expected loss experience reported across the 2009 to 2013 and 2014 accident years respectively.

▪ For other lines, net prior year development was $6.5 million unfavorable due primarily to a $5.0 million deterioration in the discontinued surety book relating to reinsurance bad debt.

Underwriting Expense Ratio

The increase of 1.0 percentage point was due to increases in the acquisition expense ratio of 0.7 percentage points and in the operating expense ratio of 0.3 percentage points, as follows:

▪ Acquisition expense ratio - increased as a result of increased acquisition costs mainly attributable to the EPC business acquired from Catlin, which was a result of new business, partially offset by the favorable impact of the modification of our reinsurance structure mentioned above and a change in the mix of business.

▪ Operating expense ratio - increased 0.3 percentage points largely due to business expansion in the prior year, partially offset by initial synergies realized from the Catlin Acquisition.

Net Results - Structured Products

Net results from structured insurance products, which decreased 82.7% to $6.3 million from the prior year result of $36.5 million. The results include net investment income of $15.7 million and $18.0 million for the six months ended June 30, 2015 and 2014, respectively, and net interest expense (credit), respectively, of $9.4 million and $(18.6) million, for the six months ended June 30, 2015 and 2014, respectively. The decrease in the net results from the prior year period was mainly from the negotiated termination of one of our larger structured indemnity contracts in the prior year. This contract had previously been designated as part of a fair value hedge with a remaining fair value adjustment of $47.0 million that was being amortized as a reduction of interest expense over the remaining term of the contract. As a result of the termination, a net decrease of $28.7 million was recorded to interest expense reflecting the accretion rate adjustment due to changes in cash flows and the realization of the full remaining balance of the fair value hedge adjustment, resulting in a net credit to interest expense.

For further information about our structured indemnity contracts that are accounted for as deposit contracts, see Item 8, Note 12, "Deposit Liabilities," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

Net Fee Income and Other

The decrease compared to the same period of 2014 in net fee income and other expenses was driven by Specialty discontinued lines.

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Reinsurance

The following table summarizes the underwriting profit (loss) for the Reinsurance segment:

	Six Months Ended				Percentage
	June 30,				Change
(U.S. dollars in thousands)	2015		2014		2015 to 2014
Gross premiums written	$	1,607,910	$	1,350,837	19.0	%
Net premiums written	1,445,936		1,228,619		17.7	%
Net premiums earned	1,008,077		854,174		18.0	%
Net losses and loss expenses	407,705		392,565		3.9	%
Acquisition costs	229,709		168,109		36.6	%
Operating expenses	114,222		88,443		29.1	%
Underwriting profit (loss)	$	256,441	$	205,057	25.1	%
Net results – structured products	3,976		6,303		(36.9	)%
Net fee income and other	1,448		1,337		8.3	%

Gross Premiums Written

The following table summarizes our gross premiums written by region for the Reinsurance segment:

	Six Months Ended				Percentage
	June 30,				Change
(U.S. dollars in thousands)	2015		2014		2015 to 2014
Bermuda	$	664,246	$	540,706	22.8	%
North America	352,997		237,204		48.8	%
London	157,148		104,604		50.2	%
Europe and MENA	286,068		344,423		(16.9	)%
Emerging markets	147,451		123,900		19.0	%
Total	$	1,607,910	$	1,350,837	19.0	%

Gross premiums written increased by 19.0%, primarily driven by the Catlin Acquisition. The acquired businesses' portfolio experienced a reduction from prior year due to rate reductions and also due to significant multi-year contracts written in the prior year which did not repeat in the current year.

When evaluated in local currency, our gross premiums written increased by 23.6%. The unfavorable foreign exchange on our gross premiums written was mainly due to the weakening of the Euro against the US dollar, impacting European business written in this currency.

Overall, excluding the impacts of the Catlin Acquisition and foreign exchange, our gross premiums written increased by 1.1%.

The following is a summary of the premium movements by region:

▪ Bermuda - increase of 22.8% due to the Catlin Acquisition. Excluding the impact of the acquired business, the region experienced a decrease of 3.3% due to reduced rates and cancellations on property catastrophe business plus the unfavorable impact of foreign exchange rates.

▪ North America - increase of 48.8% largely attributable to the Catlin Acquisition. Excluding the impact of the acquired business, the region experienced an increase of 24.4% as a result of increased new business and business volume, including a significant increase in our agricultural business and a large new casualty quota share.

▪ London - increase of 50.2% is a result of the Catlin Acquisition. Excluding the impact of the acquired business, the region experienced a decrease of 2.4% mainly driven by unfavorable foreign exchange rates particularly on the casualty lines of business.

▪ Europe and MENA - decrease of 16.9% is mainly attributable to unfavorable foreign exchange rates particularly on the property and casualty lines of business.

▪ Emerging markets - increase of 19.0% due to the Catlin Acquisition. Excluding the impact of the acquired businesses, the region experienced a decrease of 17.9%, which is a result of unfavorable foreign exchange rates, as well as estimated premium reductions in Asia on the 2014 underwriting year for property treaty, and unfavorable renewals in Latin America.

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Net Premiums Written

The increase of 17.7% resulted from the gross written premium increases as noted above, partially offset by a decrease in ceded premiums due to higher premiums in the prior year which did not repeat in the current year.

Net Premiums Earned

The increase of 18.0% is mainly attributable to the increase in net premiums written noted above.

Net Losses and Loss Expenses

Combined Ratio

The following table presents the ratios for the Reinsurance segment:

	Six Months Ended				Percentage
	June 30,				Change
	2015		2014		2015 to 2014
Loss and loss expense ratio	40.4	%	46.0	%	(5.6	)
Acquisition expense ratio	22.8	%	19.7	%	3.1
Operating expense ratio	11.4	%	10.3	%	1.1
Underwriting expense ratio	34.2	%	30.0	%	4.2
Combined ratio	74.6	%	76.0	%	(1.4	)

The loss and loss expense ratio includes net losses incurred for both the reported year and any favorable or adverse prior year development of loss and loss expense reserves held at the beginning of the year. The following table summarizes these components of the loss ratio for the Reinsurance segment for the six months ended June 30, 2015 and 2014:

	Six Months Ended				Percentage
	June 30,				Change
	2015		2014		2015 to 2014
Loss and loss expense ratio	40.4	%	46.0	%	(5.6	)
Prior year reserve development	11.3	%	9.1	%	2.2
Loss ratio excluding prior year development	51.7	%	55.1	%	(3.4	)

Loss Ratio - excluding prior year development

The 3.4 percentage point decrease in the loss ratio excluding prior year development was primarily as a result of lower levels of natural catastrophe losses in the six months ended June 30, 2015 as compared to the prior year period. Losses net of reinsurance recoveries and reinstatement premiums related to natural catastrophe events for the six months ended June 30, 2015 were $19.7 million lower than in the same period in 2014. Excluding favorable prior year development, net natural catastrophe losses and related reinstatement premiums in both quarters, the loss ratio for the six months ended June 30, 2015 compared to the same period of 2014 decreased by 1.0 percentage points to 51.7% due to lower levels of attritional losses in the acquired businesses plus the amortization of fair value adjustments made as a result of the Catlin Acquisition, partially offset by higher attritional losses and deterioration in rate levels in our legacy businesses.

Prior Year Development

The following table summarizes the net (favorable) adverse prior year reserve development by line of business relating to the Reinsurance segment for the six months ended June 30, 2015 and 2014:

	Six Months Ended
	June 30,
(U.S. dollars in thousands)	2015			2014
Property and other short-tail lines	$	(86,296	)	$	(45,638	)
Casualty and other long-tail lines	(26,930		)	(32,314		)
Total	$	(113,226	)	$	(77,952	)

Net favorable prior year reserve development of $113.2 million for the six months ended June 30, 2015 was mainly attributable to the following:

▪ Net favorable prior year development for the short-tail lines totaled $86.3 million. Details of the significant components are as follows:

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▪ For property catastrophe lines, net prior year development was $26.7 million favorable due to better than expected development on attritional losses mainly in Bermuda and Europe along with reductions on a 2012 storm and a 2013 catastrophe being partially offset by strengthening on other events.

▪ For property other lines, net prior year development was $51.2 million favorable primarily due to better than expected attritional loss development across all books.

▪ For marine and aviation lines, net prior year development was $8.5 million favorable due to better than expected attritional loss development mainly in Europe and a reduction on a 2005 hurricane.

▪ Net favorable prior year development for the long-tail lines totaled $26.9 million. Details of the significant components are as follows:

▪ For casualty lines, net prior year development was $16.1 million favorable due to better than expected attritional loss development across all books and reductions on a 2001 large loss being partially offset by strengthening on a 2008 large loss.

▪ For other lines, net prior year development was $10.8 million favorable due to better than expected development on attritional losses mainly in Bermuda and North America.

Underwriting Expense Ratio

The increase of 4.2 percentage points was due to an increase in the acquisition expense ratio of 3.1 percentage points, plus an increase in the operating expense ratio of 1.1 percentage points, as follows:

▪ Acquisition expense ratio - increased riven by an increase in acquisition expenses due to the amortization of fair value adjustments recognized as a result of the Catlin Acquisition. We also experienced increases in commissions in Asia and Bermuda as a result of adding the acquired businesses to our business mix, partially offset by changes to the commission structure of our agricultural business in North America.

▪ Operating expense ratio - increased in the six months ended June 30, 2015 compared to the same period in 2014 due to higher compensation costs, which includes the expansion of our agricultural business in North America in the prior year.

Net Results - Structured Products

Net results from structured reinsurance products, which decreased 36.9% to $4.0 million from the prior year period result of $6.3 million. The results include net investment income of $15.4 million and $17.7 million for the six months ended June 30, 2015 and 2014, respectively, interest expense of $11.2 million and $11.2 million, and operating expenses of $0.3 million and $0.3 million, for the six months ended June 30, 2015 and 2014, respectively. The decrease in the net results from the prior year period was mainly due to a reduction in investment income resulting from a lower asset base, reflecting the run-off nature of this business.

For further information about our structured indemnity contracts that are accounted for as deposit contracts, see Item 8, Note 12, "Deposit Liabilities," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

Corporate and Other (including run-off Life Operations)

As stated above, XLIB sold 100% of the common shares of XLLR. As a result, XLLR reinsures the majority of our life reinsurance business through the Life Retro Arrangements. This transaction covers a substantial portion of our life reinsurance reserves. We announced the run-off of our life reinsurance business in 2009.

Subsequent to the transaction, we no longer consider our Life operations to be a separate operating segment, and the results of the Run-Off Life Operations are reported within Corporate and Other. For a further discussion, see Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," to the Unaudited Consolidated Financial Statements included herein.

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Impact of Life Retro Arrangements

Subsequent to the completion of the sale of our life reinsurance subsidiary XLLR, as described in Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," to the Unaudited Consolidated Financial Statements included herein, the impact of the Life Retro Arrangements on the Company's results for the six months ended June 30, 2015 and 2014 were as follows:

Impact of Life Retro Arrangements	Six Months Ended June 30,
(U.S. dollars in thousands)	2015			2014
Underwriting profit (loss) (1)	$	603		$	—
Net investment income - Life Funds Withheld Assets	97,283			19,165
Net realized gains (losses) on investments sold - Life Funds Withheld Assets	120,775			624
Net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets	(18,783		)	—
OTTI on investments - Life Funds Withheld Assets	(8,087		)	(8,771		)
Exchange (gains) losses	(14,686		)	—
Other income and expenses	2,475			(19		)
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	9,807			(17,546		)
Net income (loss)	$	189,387		$	(6,547	)
Change in net unrealized gains (losses) on investments - Life Funds Withheld Assets, net of tax	(283,931		)	12,297
Change in adjustments related to future policy benefit reserves, net of tax	86,684			—
Change in cumulative translation adjustment - Life Funds Withheld Assets, net of tax	8,463			(5,750		)
Total changes to other comprehensive income as a result of Life Retro Arrangements	$	(188,784	)	$	6,547
Comprehensive income (loss)	$	603		$	—

____________

(1) The underwriting profit of $0.6 million relates to a premium adjustment during the six months ended June 30, 2015 relating to the Life Retro Arrangements transaction which was completed on May 30, 2014.

As shown in the table above, although our net income (loss) is subject to variability related to the Life Retro Arrangements, there is minimal impact on our comprehensive income in any period. For further information on the life retrocession embedded derivative, see Item 1, Note 7(d)(iii), "Derivative Instruments - Other Non-Investment Derivatives - Credit Exposure," to the Unaudited Consolidated Financial Statements included herein.

Run-Off Life Operations - not subject to Life Retro Arrangements

During the six months ended June 30, 2015, our net underwriting result from our Run-Off Life Operations - not subject to Life Retro Arrangements was a loss of $13.7 million and our net investment result relating to our Run-Off Life Operations - not subject to Life Retro Arrangements, including net realized gains and losses, was $20.1 million, producing a net income of $6.4 million.

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Investment Performance (Excluding Life Funds Withheld Assets)

We manage our fixed income portfolio in accordance with investment guidelines approved by the Risk and Finance Committee of the Board of Directors of XL-Ireland. The following is a summary of the investment portfolio returns, which are calculated by dividing the sum of gross investment income or net income from investment affiliates, realized gains (losses) and unrealized gains (losses) by the average market value of the portfolio, for each of our fixed income and non-fixed income portfolios, for the six months ended June 30, 2015 and 2014:

	Six Months Ended
	June 30,
	2015		2014
Total Return on Investments (1)	0.9	%	3.8	%
Other Portfolios (2)
Alternative portfolio (3)	4.7	%	4.0	%
Equity portfolio	2.0	%	7.1	%

___________

(1) The performance of investment portfolios is measured on a local currency basis and is not annualized. For the aggregate performance calculation, respective local currency balances are translated to U.S. dollars using quarter end exchange rates to calculate composite portfolio results. Performance represents the P&C operations and Run-Off Life Operations for the six months ended June 30, 2015 and the two months ending June 30, 2014.

(2) Performance on Other Portfolios is included in the Total Return on Investments.

(3) Performance on the alternative portfolio reflects the six months ended May 31, 2015 and 2014, respectively, for both equity and non-equity alternative funds.

Investment Activities (Excluding Life Funds Withheld Assets)

The following table illustrates net investment income, net income from investment fund affiliates, net realized (losses) gains on investments and net realized and unrealized gains (losses) on derivative instruments for the six months ended June 30, 2015 and 2014:

	Six Months Ended				Percentage
	June 30,				Change
(U.S. dollars in thousands)	2015		2014		2015 to 2014
Net investment income (1)	$	334,434	$	446,797	(25.1	)%
Net income (loss) from investment fund affiliates (2)	66,706		50,986		30.8	%
Net realized gains (losses) on investments	8,953		100,073		(91.1	)%
Net realized and unrealized gains (losses) on derivative instruments	65,030		13,409		N/M

____________

(1) Net investment income includes: Net investment income - excluding Life Funds Withheld Assets and net investment income related to the net results from structured products.

(2) We generally record the income related to alternative fund affiliates on a one-month lag and the private investment fund affiliates on a three-month lag based upon the availability of the information provided by the investees.

* N/M - Not Meaningful

Net Investment Income

The decrease of 25.1% was primarily due to the impact of the Life Retro Arrangements since all of the investment results associated with the Life Funds Withheld Assets ultimately accrue to GreyCastle. For further information on the Life Retro Arrangements see Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," to the Unaudited Consolidated Financial Statements included herein.

In addition, a reduction in investment yields as a result of lower reinvestment rates contributed to the net investment income decrease. We estimate that approximately $4.1 billion of assets with an average gross book yield of 2.4% will mature and pay down over the next 12 months compared to the average new money rate in the six months ended June 30, 2015 on our portfolio of 1.3%.

Net Income (Loss) from Investment Fund Affiliates

Net income from investment fund affiliates includes earnings from our investments in closed-end investment funds and partnerships and similar vehicles that are accounted for under the equity method.

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Performance for the six months ended June 30, 2015 was strong and higher than the same period of 2014, driven by higher returns from both alternative investment funds and private investment funds. The more positive results from the alternative investment funds were principally in funds pursuing macro, fundamental equity and quantitative equity strategies.

Net Realized Gains and Losses on Investments

Net realized gains on investments of $9.0 million included the following:

▪ Net realized gains of $36.1 million resulted primarily from sales of U.S. Government and Government Related fixed maturities and equities, partially offset by losses in corporate securities and other investments.

▪ Realized losses of approximately $27.2 million related to the OTTI write-down of certain of our AFS investments. The main components of the net impairment charges were:

▪ $12.4 million related to certain high yield securities which we no longer intend to hold for a period sufficient to recover fair value to amortized cost.

▪ $6.5 million related to Other Investments that we no longer intend to hold for a period sufficient to recover fair value to amortized cost.

▪ $4.0 million related to certain Alternatives that were in a loss position for more than 11 months.

▪ $0.6 million related to certain equities as the holdings were in a loss position for more than 11 months.

▪ $0.3 million for structured securities, principally non-Agency RMBS, where we determined that the likely recovery on these securities was below the carrying value and, accordingly, recorded an impairment of the securities to the discounted value of the cash flows expected to be received on these securities.

▪ $3.4 million related to foreign exchange losses.

Net realized gains on investments of $100.1 million in the six months ended June 30, 2014 included realized losses of $28.3 million related to the write-down of certain of our structured securities and medium term notes and currency loses with respect to which we determined that there was an other-than-temporary decline in the value of those investments, as well as net realized gains of $128.4 million.

Net Realized and Unrealized Gains and Losses on Derivative Instruments

Net realized and unrealized gains on derivatives of $65.0 million in the six months ended June 30, 2015 resulted from our investment strategy to manage interest rate risk, foreign exchange risk and credit risk, and to replicate permitted investments. As part of our strategy to manage discrete foreign exchange risk associated with the Catlin Acquisition, certain foreign exchange contracts were entered into and other hedging strategies were modified. Upon the closing of the Catlin Acquisition, these contacts were settled and the hedging strategies terminated. Net realized and unrealized gains on derivative instruments for the six months ended June 30, 2015 include $54.7 million from the Catlin Acquisition-related foreign exchange contracts and hedging strategies.. For a further discussion, see Item 1, Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements included herein.

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Other Revenues and Expenses

The following table sets forth our other revenues and expenses for the six months ended June 30, 2015 and 2014:

	Six Months Ended					Percentage
	June 30,					Change
(U.S. dollars in thousands)	2015		2014			2015 to 2014
Net income (loss) from operating affiliates (1)	$	32,130	$	74,023		(56.6	)%
Gain on sale of operating affiliate	340,407		—			N/M
Exchange (gains) losses	37,764		31,582			19.6	%
Corporate operating expenses	193,430		107,833			79.4	%
Loss on sale of life reinsurance subsidiary	—		666,423			N/M
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	9,807		(17,546		)	N/M
Interest expense (2)	80,519		64,444			24.9	%
Income tax expense	57,177		28,667			99.5	%

____________

(1) The Company generally records the income related to certain operating affiliates on a three-month lag based upon the availability of the information provided by the investees.

(2) Interest expense includes costs related to our debt and collateral facilities and does not include deposit liability accretion, which is included in Net investment results - structured products.

* N/M - Not Meaningful

Net Income (Loss) from Operating Affiliates

The following table sets forth the net income (loss) from operating affiliates for the six months ended June 30, 2015 and 2014:

	Six Months Ended				Percentage
	June 30,				Change
(U.S. dollars in thousands)	2015		2014		2015 to 2014
Net income (loss) from investment manager affiliates	$	12,263	$	40,130	(69.4	)%
Net income (loss) from strategic operating affiliates	19,867		33,893		(41.4	)%
Net income (loss) from operating affiliates	$	32,130	$	74,023	(56.6	)%

Net Income from Investment Manager Affiliates

The results for the six months ended June 30, 2015 reflect a significant decline in the amount of incentive fees earned by several investment manager affiliates. The results reflected in the first quarter of 2014 were very strong for certain managers. Similar positive results have not been realized in the comparable period this year.

Net Income from Strategic Operating Affiliates

The decrease of 41.4% was largely due to the sale of our interest of ARX, which was an insurance affiliate that writes direct U.S. homeowners insurance, as noted in Item 1, Note 3(b), "Acquisition and Disposals - Sale of Operating Affiliate."

Exchange Gains and Losses

The foreign exchange losses of $37.8 million in the six months ended June 30, 2015 were a result of an overall weakening of the U.S. dollar, driven mainly by U.K. sterling and the Swiss franc, partially offset by by a strengthening of the U.S. dollar against the Euro. In the six months ended June 30, 2014, foreign exchange losses of $31.6 million were a result of an overall strengthening of the value of the U.S. dollar against our major currency exposures, particularly the U.K. sterling, the Euro, and the Swiss franc.

Corporate Operating Expenses

The increase of 79.4% was primarily due to costs associated with the Catlin Acquisition as noted in Item 1, Note 3(a), "Acquisition and Disposals - Catlin Acquisition."

Loss on Sale of Life Reinsurance Subsidiary

The loss on sale of life reinsurance subsidiary was due to the sale of 100% of the common shares of XLLR, a wholly-owned subsidiary of XLIB, to GreyCastle for $570 million in cash. For a further discussion, see Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," to the Unaudited Consolidated Financial Statements included herein.

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Net Realized and Unrealized Gains and Losses on Life Retrocession Embedded Derivative and Derivative Instruments - Life Funds Withheld Assets

The Company has entered into Life Retro Arrangements, as described in Note 3, "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," to the Unaudited Consolidated Financial Statements included herein. The embedded derivative is recorded at fair value with changes in fair value recognized in earnings through "Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets." For a further discussion, see Item 1, Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements included herein and "Impact of Life Retro Arrangements" above.

Interest Expense

The increase of 24.9% was a result of the overall increase in our debt due to the issuance of subordinated notes in March 2015 and the liabilities assumed from the Catlin Acquisition, as well as expenses related to the Bridge Facility, as outlined in Item 1, Note 3(a), "Acquisition and Disposals - Catlin Acquisition." For further information about our debt financing, see Item 8, Note 15, "Notes Payable and Debt and Financing Arrangements," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014 and Item 1, Note 10, "Notes Payable and Debt and Financing Arrangements," to the Unaudited Consolidated Financial Statements included herein.

Income Tax Expense

Tax charges of $57.2 million and $28.7 million were incurred in the six months ended June 30, 2015 and 2014, respectively. The tax charges recognized in these periods reflect the combination of our expected full year effective tax rate applicable to each of the years, applied to our operating income in the respective periods, and the tax calculated on non-operating items. Non-operating items primarily include the gain on the sale of ARX and the respective gains and losses on investments and derivative instruments, which are accounted for discretely at the applicable tax rate in the jurisdiction in which they are recognized.

As a result of the Catlin Acquisition, the expected full year effective tax rate applicable to current year to date operating income has been determined using a single rate approach taking into account the full year expected results, including the post-acquisition results of the acquired businesses.

BALANCE SHEET ANALYSIS

Investments (Excluding Life Funds Withheld Assets)

We seek to generate growth in book value and net investment income through our investment activities. Our investment strategy strives to balance investment returns against market and credit risk. Our overall investment portfolio is structured to take into account a number of variables including liability profile, local regulatory requirements, business needs, collateral management and risk tolerance.

As described in Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary" and Note 6, "Investments," to the Unaudited Consolidated Financial Statements included herein, in connection with the Life Retro Arrangements certain fixed maturities were reclassified from held to maturity to available for sale. All of the reclassified securities are included within the Life Funds Withheld Assets, along with certain other available for sale securities as defined in the sale and purchase agreement for the sale of our life reinsurance subsidiary. The Life Funds Withheld Assets are managed pursuant to agreed upon investment guidelines that meet the contractual commitments of the XL ceding companies and applicable laws and regulations. All of the investment results associated with the Life Funds Withheld Assets ultimately accrue to GCLR. Because we no longer share in the risks and rewards of the underlying performance of the supporting invested assets, our Consolidated Statements of Income and disclosures within the financial statement notes included herein, and in the table below, separately report the Life Funds Withheld Assets from the rest of our investments. The remaining disclosures in this section exclude the Life Funds Withheld Assets.

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As of June 30, 2015 and December 31, 2014, total investments and cash and cash equivalents, including accrued investment income and net receivable/(payable) for investments sold/(purchased) but excluding Life Funds Withheld Assets, were approximately $38.1 billion and $30.8 billion, respectively. The following table summarizes the composition of our invested assets, excluding Life Funds Withheld Assets, as of June 30, 2015 and December 31, 2014:

	June 30, 2015					December 31, 2014
(U.S. dollars in thousands)	Carrying Value (1)			Percent of Total		Carrying Value (1)		Percent of Total
Cash and cash equivalents	$	2,825,416		7.4	%	$	2,327,160	7.6	%
Restricted cash	43,996			0.1	%	—		—	%
Net receivable/ (payable) for investments sold/ (purchased)	(30,834		)	(0.1	)%	50,471		0.2	%
Accrued investment income	236,484			0.6	%	226,721		0.7	%
Short-term investments	807,486			2.1	%	256,727		0.8	%
Fixed maturities - AFS:
U.S. Government and Government-Related/Supported	3,827,106			10.0	%	2,171,953		7.1	%
Corporate - Financials	3,235,513			8.5	%	2,761,916		9.0	%
Corporate - Non Financials (2)	6,952,064			18.2	%	6,016,457		19.4	%
RMBS – Agency	3,958,144			10.4	%	3,728,576		12.1	%
RMBS – Non-Agency	372,271			1.0	%	427,351		1.4	%
CMBS	936,058			2.5	%	1,052,544		3.4	%
CDO	488,025			1.3	%	692,034		2.2	%
Other asset-backed securities (2)	2,350,387			6.2	%	1,065,293		3.5	%
U.S. States and political subdivisions of the States	2,391,273			6.3	%	2,021,272		6.6	%
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	5,260,062			13.8	%	4,240,073		13.8	%
Total fixed maturities - AFS	$	29,770,903		78.2	%	$	24,177,469	78.5	%
Equity securities	1,073,470			2.8	%	868,292		2.8	%
Investments in affiliates	1,663,852			4.4	%	1,637,620		5.3	%
Other investments	1,743,259			4.5	%	1,248,439		4.1	%
Total investments and cash and cash equivalents - excluding Life Funds Withheld Assets	$	38,134,032		100.0	%	$	30,792,899	100.0	%

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(1) Carrying value represents the fair value for AFS fixed maturities.

(2) Includes certain floating rate medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a carrying value of $75.3 million and $79.9 million and an amortized cost of $64.5 million and $68.4 million as of June 30, 2015 and December 31, 2014, respectively. These securities have been allocated ratings based on the underlying pool of securities. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate values of these notes.

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We review our corporate debt investments on a regular basis to consider their concentration, credit quality and compliance with established guidelines. As of June 30, 2015, the average credit quality of our total fixed income portfolio (consisting of U.S. and Non-U.S. government related and supported debt, corporate debt, and asset-backed and mortgage-backed securities, having fixed maturities and including short-term investments, cash and cash equivalents and net receivable/(payable) for investments sold/(purchased)) was "Aa2(AA)," and Aa3(AA-) as of December 31, 2014. Included in the table below are the credit ratings of the fixed income portfolio excluding operating cash as of June 30, 2015 and December 31, 2014:

	June 30, 2015				December 31, 2014
Investments by Credit Rating (1) (U.S. dollars in millions)	Carrying Value (2)		Percent of Total		Carrying Value (2)		Percent of Total
AAA	$	14,744	46.5	%	$	11,509	44.1	%
AA	6,866		21.7	%	5,334		20.4	%
A	6,864		21.6	%	6,158		23.6	%
BBB	2,446		7.7	%	2,321		8.9	%
BB and below	687		2.2	%	793		3.0	%
Not rated	109		0.3	%	15		—	%
Total	$	31,716	100.0	%	$	26,130	100.0	%

____________

(1) The credit rating for each asset reflected above was principally determined based on the weighted average rating of the individual securities from Standard & Poor's, Moody's Investors Service and Fitch Ratings (when available). U.S. Agency debt and related mortgage-backed securities, whether with implicit or explicit government support, reflect the credit quality rating of the U.S. government for the purpose of these calculations.

(2) Excludes Life Funds Withheld Assets.

Gross and Net Unrealized Gains and Losses on Investments (Excluding Life Funds Withheld Assets)

We had gross unrealized losses totaling $282.8 million on 2,944 securities out of a total of 8,969 held as of June 30, 2015 in our AFS portfolio (excluding Life Funds Withheld Assets) that we consider to be temporarily impaired. Individual security positions comprising this balance have been evaluated by management, in conjunction with our investment managers, to determine the severity of these impairments and whether they should be considered other-than-temporary.

Gross unrealized losses can be attributed to the following significant drivers:

• gross unrealized losses of $88.9 million related to Government and Government Related holdings. Securities in a gross unrealized loss position had a fair value of $4.0 billion as of June 30, 2015.

• gross unrealized losses of $71.7 million related to the Corporate holdings. Securities in a gross unrealized loss position had a fair value of $3.6 billion as of June 30, 2015.

• gross unrealized losses of $17.9 million related to Non-Agency RMBS securities (which consists of our holdings of sub-prime Non-Agency RMBS, second liens, asset backed securities collateralized debt obligations ("ABS CDOs") with sub-prime collateral, Alt-A and Prime RMBS). Securities in an unrealized loss position had a fair value of $242.3 million as of June 30, 2015. The Company has incurred realized losses, consisting of charges for OTTI and realized losses from sales, of approximately $1.4 billion since the beginning of 2007 through June 30, 2015 on these asset classes.

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The following table details the security type and length of time that AFS securities were in a continual gross unrealized loss position as of June 30, 2015:

(U.S. dollars in thousands)	June 30, 2015
Security Type and Length of Time in a Continual Unrealized Loss Position (1)	Amount of Unrealized Loss			Fair Value of Securities in an Unrealized Loss Position
Fixed Maturities and Short-Term Investments
Less than 6 months	$	(112,542	)	$	9,500,619
At least 6 months but less than 12 months	(35,196		)	555,506
At least 12 months but less than 2 years	(23,516		)	401,761
2 years and over	(84,710		)	1,332,780
Total	$	(255,964	)	$	11,790,666
Equities
Less than 6 months	$	(13,830	)	$	201,058
At least 6 months but less than 12 months	(12,957		)	66,701
Total	$	(26,787	)	267,759

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(1) Excludes Life Funds Withheld Assets.

The following is the maturity profile of the AFS fixed income securities that were in a continual gross unrealized loss position as of June 30, 2015:

	June 30, 2015
(U.S. dollars in thousands)	Amount of Unrealized Loss			Fair Value of Securities in an Unrealized Loss Position
Maturity profile in years of AFS fixed income securities in a gross unrealized loss position (1)
Less than 1 year remaining	$	(16,938	)	$	788,684
At least 1 year but less than 5 years remaining (2)	(58,875		)	4,594,557
At least 5 years but less than 10 years remaining (2)	(63,757		)	2,369,682
At least 10 years but less than 20 years remaining (2)	(10,775		)	303,563
At least 20 years or more remaining (2)	(22,067		)	276,493
RMBS - Agency	(20,820		)	1,382,365
RMBS - Non-Agency	(17,921		)	242,413
CMBS	(8,311		)	396,014
CDO	(24,573		)	362,653
Other asset-backed securities	(11,927		)	1,074,242
Total	$	(255,964	)	$	11,790,666

____________

(1) Excludes Life Funds Withheld Assets.

(2) Tier One and Upper Tier Two securities, representing committed term debt and hybrid instruments senior to the common and preferred equities of the financial institutions, are allocated based on the call date unless such security is not called on such date, in which case it is allocated the final or longest expected maturity. Medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage are allocated based on contractual maturity.

Factors considered in determining that additional OTTI charges were not warranted include management's consideration of current and near term liquidity needs along with other available sources of liquidity, and in certain instances an evaluation of the factors and time necessary for recovery. For further information, see Item 1, Note 6, "Investments," to the Unaudited Consolidated Financial Statements included herein.

As noted in Item 8, Note 2, "Significant Accounting Policies," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014, the determination of the amount of OTTI varies by investment type and is based upon our periodic evaluation and assessment of known and inherent risks associated with the respective asset class. Such evaluations and assessments are revised as conditions change and new information becomes available. We consider a wide range of factors about the securities and use our best judgment in evaluating the cause of the decline in the estimated fair value of the security and in assessing the prospects for near-term recovery. Inherent in our evaluation of the security are assumptions and estimates about the operations of the issuer and its future earnings potential. We update our evaluations regularly and reflect additional impairments in net income as determinations are made. Our determination of the amount of the impairment taken on investments is highly subjective and could adversely impact our results

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of operations. There can be no assurance that we have accurately assessed the level of OTTI taken and reflected in our financial statements. Furthermore, additional impairments may need to be taken in the future. Historical trends may not be indicative of future impairments.

Levels of write down or OTTI are also impacted by our assessment of the intent to sell securities that have declined in value prior to recovery. If, due to changes in circumstances, we determine to reposition or realign portions of the portfolio and we determine not to hold certain securities in an unrealized loss position to recovery, we will incur OTTI charges, which could be significant. In addition, in our assessment of whether securities in a gross unrealized loss position are temporarily impaired, we consider the significance of the impairments.

As of June 30, 2015, we had structured securities with gross unrealized losses of $18.2 million on non-Agency RMBS, $19.5 million on core CDOs and $8.3 million on CMBS holdings. Within these security classifications are mortgage and asset-backed securities that had a fair value of $6.9 million, gross unrealized losses of $8.8 million and a cumulative fair value decline of greater than 50% of amortized cost in each case as of June 30, 2015. We have evaluated each of these securities in conjunction with our investment manager service providers and believe it is more likely than not that the issuer will be able to fund sufficient principal and interest payments to support the current amortized cost.

Refer to "Significant Items Affecting the Results of Operations" above for further discussion surrounding the impact of credit market movements on our investment portfolio.

European Sovereign Debt Crisis (Excluding Life Funds Withheld Assets)

As developed markets emerged from the global recession, several key nations within the European Union (the "E.U.") - particularly Greece, Italy, Ireland, Portugal and Spain (the "European Periphery Nations") - have carried particularly high levels of debt and have been slower to return to positive economic growth due to austerity measures implemented to lower such countries' debt levels, and a general lack of competitiveness. The European Central Bank has taken various measures and has asserted its willingness to take any measures deemed necessary to protect these sovereigns' ability to continue to fund their debt. As a result, we believe market risks associated with the European Sovereign Debt crisis have been greatly reduced.

Our exposure to this European sovereign debt crisis is from direct investment in fixed maturity securities issued by national and local governments of the European Periphery Nations, as well as from fixed maturity securities issued by certain financial and non-financial corporate entities operating within the European Periphery Nations which currently have a fair value of $136.5 million as of June 30, 2015. We continue to monitor our financial exposure to this crisis, and continually assess the impact of a potential default by any of the European Periphery Nations on their respective debt issuances, including the associated impact on non-sovereign entities in these five nations in the event of such a default.

We currently have no unfunded investment exposures or commitments to either sovereign or non-sovereign entities within the European Periphery Nations. We do invest in various alternative and private investment funds and medium term notes that from time to time may invest in securities or investments related to the European Periphery Nations. In general, such funds and medium term notes will invest in debt and/or equity securities of individual corporate issuers, securitized debt instruments and/or fixed maturity instruments issued by national governments of the European Periphery Nations. As market volatility in the European Periphery Nations has declined, we have observed that our alternative and private fund managers have increased their exposure to these countries. We estimate that, as of June 30, 2015, our aggregate exposure to European Periphery Nations via our fund investments and medium term notes did not exceed $175 million on a net basis. The exposure was diversified across issues and instruments and across the five European Periphery Nations.

In addition to the direct investment portfolio considerations discussed above, as an international (re)insurance company, European credit exposures may exist for us within unpaid losses and loss expenses recoverable and reinsurance balances receivable. For further details on these balances, including the names of our most significant reinsurance counterparties, see Item 8, Note 10, "Reinsurance," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014. Other sources of potential exposure to European credit issues may exist within certain lines of insurance or reinsurance business written (including, but not limited to lines such as surety, business interruption, and political risk), or within underlying investments held in securitized financial instruments or in structured transactions in which we have an interest. We consider these potential exposures as part of our ongoing enterprise risk management processes.

Fair Value Measurements of Assets and Liabilities

As described in Item 1, Note 4, "Fair Value Measurements," to the Unaudited Consolidated Financial Statements included herein, we have provided required disclosures by level within the fair value hierarchy of the Company’s assets and liabilities that are carried at fair value. As defined in the hierarchy, those assets and liabilities categorized as Level 3 have valuations determined using unobservable inputs. Unobservable inputs may include an entity’s own assumptions about market participant assumptions, applied to a modeled valuation; however, this is not the case with respect to the Company’s Level 3 assets and liabilities. The vast majority of the assets and liabilities classified as Level 3 are made up of those securities for which the

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values were obtained from brokers where either significant inputs were utilized in determining the values that were difficult to corroborate with observable market data or sufficient information regarding the specific inputs utilized by the broker was not obtained to support a Level 2 classification.

Controls over Valuation of Financial Instruments

We perform regular reviews of the prices received from our third party valuation sources to assess whether the prices represent a reasonable estimate of the fair value. This process is completed by investment and accounting personnel who are independent of those responsible for obtaining the valuations. The approaches we take include, but are not limited to, annual reviews of the controls of the external parties responsible for sourcing valuations that are subjected to automated tolerance checks, quarterly reviews of the valuation sources and dates, comparisons of executed sales prices to prior valuations, regular deep dives on a sample of securities across our major asset classes and monthly reconciliations between the valuations provided by our external parties and valuations provided by our third party investment managers at a portfolio level.

In addition, we assess the effectiveness of valuation controls performed by external parties responsible for sourcing appropriate valuations from third parties on our behalf. The approaches taken by these external parties to gain comfort include, but are not limited to, comparing valuations between external sources, completing recurring reviews of third party pricing services' methodologies and reviewing controls of the third party service providers to support the completeness and accuracy of the prices received. Where broker quotes are the primary source of the valuations, sufficient information regarding the specific inputs utilized by the brokers is generally not available to support a Level 2 classification. We obtain the majority of broker quoted values from third party investment managers who perform independent verifications of these valuations using pricing matrices based upon information gathered by market traders. In addition, for the majority of these securities, we compare the broker quotes to independent valuations obtained from third party pricing vendors, which may also consist of broker quotes, to assess if the prices received represent reasonable estimates of the fair values.

Valuation Methodology of Level 3 Assets and Liabilities

See Item 1, Note 4, "Fair Value Measurements," of the Unaudited Consolidated Financial Statements included herein, for a description of the valuation methodology utilized to value Level 3 assets and liabilities, how the valuation methodology is validated as well as further details associated with various assets classified as Level 3. As of June 30, 2015, we did not have any liabilities that were carried at fair value based on Level 3 inputs other than derivative instruments in a liability position as of June 30, 2015.

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Fair Value of Level 3 Assets and Liabilities (Excluding Life Funds Withheld Assets)

As of June 30, 2015, the fair value of total assets and liabilities carried at fair value, the fair value of Level 3 assets and liabilities and the percentage of Level 3 assets to our total assets and liabilities that are carried at fair value were as follows:

(U.S. dollars in thousands)	Total Assets and Liabilities Carried at Fair Value at June 30, 2015		Fair Value of Level 3 Assets and Liabilities		Level 3 Assets and Liabilities as a Percentage of Total Assets and Liabilities Carried at Fair Value, by Class
Assets
Fixed maturities, at fair value
U.S. Government and Government Agency-Related/Supported	$	3,827,106	$	—	—	%
Corporate - Financials	3,235,513		10,000		0.3	%
Corporate - Non-Financials	6,952,064		5,554		0.1	%
RMBS – Agency	3,958,144		3,038		0.1	%
RMBS – Non-Agency	372,271		—		—	%
CMBS	936,058		—		—	%
CDO	488,025		484,171		99.2	%
Other asset-backed securities	2,350,387		42,745		1.8	%
U.S. States and political subdivisions of the States	2,391,273		—		—	%
Non-U.S. Sovereign Government, Supranational and Government-Related	5,260,062		—		—	%
Total Fixed maturities, at fair value	$	29,770,903	$	545,508	1.8	%
Equity securities, at fair value	1,073,470		—		—	%
Short-term investments, at fair value	807,486		—		—	%
Total investments available for sale	$	31,651,859	$	545,508	1.7	%
Cash equivalents (1)	975,876		—		—	%
Other investments (2)	1,395,065		255,672		18.3	%
Other assets (3)	225,236		13,392		5.9	%
Total assets carried at fair value	$	34,248,036	$	814,572	2.4	%
Liabilities
Financial instruments sold, but not yet purchased (4)	$	2,814	$	—	—	%
Other liabilities (5)	79,645		23,145		29.1	%
Total liabilities carried at fair value	$	82,459	$	23,145	28.1	%

____________

(1) Cash equivalents balances subject to fair value measurements include certificates of deposit and money market funds.

(2) The Other investments balances exclude certain structured transactions including certain investments in project finance transactions and a payment obligation (for further information, see Item 8, Note 8, "Other Investments," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014) that has provided liquidity financing to a structured credit vehicle as a part of a third party medium term note facility. These Other investments are carried at amortized cost, which totaled $348.2 million at June 30, 2015.

(3) Other assets include derivative instruments, reported on a gross basis.

(4) Financial instruments sold, but not yet purchased, are included within "Payable for investments purchased" on the balance sheets.

(5) Other liabilities include derivative instruments, reported on a gross basis.

As of June 30, 2015, our Level 3 assets represented approximately 2.4% of our assets that are measured at fair value and represented approximately 2% of total assets. Our Level 3 liabilities represented approximately 28.1% of liabilities that are measured at fair value but less than 1% of total liabilities at June 30, 2015.

Changes in the Fair Value of Level 3 Assets and Liabilities

See Item 1, Note 4, "Fair Value Measurements," to the Unaudited Consolidated Financial Statements included herein, for an analysis of the change in fair value of Level 3 Assets and Liabilities.

Unpaid Losses and Loss Expenses

We establish reserves to provide for estimated claims, the general expenses of administering the claims adjustment process and losses incurred but not reported. These reserves are calculated using actuarial and other reserving techniques to project the estimated ultimate net liability for losses and loss expenses. Our reserving practices and the establishment of any particular reserve reflect our judgment concerning sound financial practice and do not represent any admission of liability with respect to any claims made against us.

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Gross unpaid losses and loss expenses totaled $25.8 billion and $19.4 billion as of June 30, 2015 and December 31, 2014, respectively. The table below represents a reconciliation of our P&C unpaid losses and loss expenses for the six months ended June 30, 2015:

(U.S. dollars in thousands)	Gross unpaid losses and loss expenses			Unpaid losses and loss expenses recoverable			Net unpaid losses and loss expenses
Balance at December 31, 2014	$	19,353,243		$	(3,411,526	)	$	15,941,717
Losses and loss expenses incurred	2,616,637			(695,615		)	1,921,022
Losses and loss expenses (paid) / recovered	(2,764,250		)	350,344			(2,413,906		)
Loss reserves acquired	6,933,143			(1,493,267		)	5,439,876
Foreign exchange and other	(298,392		)	109,054			(189,338		)
Balance at June 30, 2015	$	25,840,381		$	(5,141,010	)	$	20,699,371

While we regularly review the adequacy of established reserves for unpaid losses and loss expenses, no assurance can be given that actual claims made and payments related thereto will not be in excess of the amounts reserved. In the future, if such reserves develop adversely, such deficiency would have a negative impact on future results of operations. For further discussion, see "Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates - 1) Unpaid Loss and Loss Expenses and Unpaid Loss and Loss Expenses Recoverable," and Note 11, "Losses and Loss Expenses," to the Consolidated Financial Statements included in Items 7 and 8, respectively, in our Annual Report on Form 10-K for the year ended December 31, 2014.

Unpaid Losses and Loss Expenses Recoverable and Reinsurance Balances Receivable

In the normal course of business, we seek to reduce the potential amount of loss arising from claims events by reinsuring certain levels of risk assumed in various areas of exposure with other insurers or reinsurers. While reinsurance agreements are designed to limit our losses from large exposures and permit recovery of a portion of direct unpaid losses, reinsurance does not relieve our ultimate liability to the insureds. Accordingly, the losses and loss expense reserves on the balance sheets represent our total unpaid gross losses. Unpaid losses and loss expense recoverable relates to estimated reinsurance recoveries on the unpaid loss and loss expense reserves.

The table below presents our net paid and unpaid losses and loss expenses recoverable and reinsurance balances receivable as follows:

(U.S. dollars in thousands)	June 30, 2015			December 31, 2014
Reinsurance balances receivable	$	393,942		$	153,613
Reinsurance recoverable on future policy benefits (excluding balances related to the Life Retro Arrangements)	14,600			17,840
Reinsurance recoverable on unpaid losses and loss expenses	5,194,831			3,453,873
Bad debt reserve on unpaid losses and loss expenses recoverable and reinsurance balances receivable	(75,954		)	(64,439		)
Net paid and unpaid losses and loss expenses recoverable and reinsurance balances receivable	$	5,527,419		$	3,560,887

LIQUIDITY AND CAPITAL RESOURCES

Liquidity is a measure of our ability to generate sufficient cash flows to meet the short- and long-term cash requirements of our business operations. As a global insurance and reinsurance company, one of our principal responsibilities to clients is to ensure that we have ready access to funds with which to settle claims, including large or multiple unforeseen claims. We would generally expect that positive cash flow from operations (underwriting activities and investment income) will be sufficient to cover cash outflows under most future loss scenarios. However, there is a possibility that unforeseen demands could be placed on us due to extraordinary events and, as such, our liquidity needs may change. Such events include, among other things: several significant catastrophes occurring in a relatively short period of time resulting in material incurred losses; rating agency downgrades of our core insurance and reinsurance subsidiaries that would require posting of collateral in connection with our letter of credit and revolving credit facilities; the return of unearned premiums and/or the settlement of derivative transactions and large scale uncollectible reinsurance recoverables on paid losses (as a result of coverage disputes, reinsurers' credit problems or decreases in the value of collateral supporting reinsurance recoverables). Any one or a combination of such events may cause a liquidity strain for us. In addition, a liquidity strain could also occur when there is illiquidity in financial markets, such as that which was experienced in 2008. Investments that may be used to meet liquidity needs in the event of a liquidity strain may not be liquid due to inactive markets, or may have to be sold at a significant loss as a result of depressed prices. Because each subsidiary focuses on a more limited number of specific product lines than is collectively available from the

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consolidated group of companies, the mix of business tends to be less diverse at the subsidiary level. As a result, the probability of a liquidity strain, as described above, may be greater for individual subsidiaries than when liquidity is assessed on a consolidated basis. If such a liquidity strain were to occur in a subsidiary, XL-Ireland may be required to contribute capital to the particular subsidiary and/or curtail dividends from the subsidiary that would otherwise support holding company operations and dividend payments, which may be difficult given that XL-Ireland is a holding company and has limited liquidity.

A downgrade below "A-" of our principal insurance and reinsurance subsidiaries by either S&P or A.M. Best, which is three notches below the current S&P financial strength rating of "A+" (Stable) and two notches below the A.M. Best financial strength rating of "A" (Stable) of these subsidiaries, may trigger cancelation provisions in a significant amount of our assumed reinsurance agreements and may potentially require us to return unearned premiums to cedants. In addition, due to collateral posting requirements under our letter of credit and revolving credit facilities, such a downgrade may require the posting of cash collateral in support of certain "in use" portions of these facilities. Specifically, a downgrade below "A-" by A.M. Best would constitute an event of default under our two largest credit facilities and may trigger such collateral requirements. In certain limited instances, such downgrades may require that we return cash or assets to counterparties or to settle derivative and/or other transactions with the respective counterparties. See Item 1A, "Risk Factors," included in our Annual Report on Form 10-K for the year ended December 31, 2014.

Holding Company Liquidity

As holding companies, XL-Ireland and XL-Cayman have no operations of their own and their assets consist primarily of investments in subsidiaries. XL-Ireland's principal uses of liquidity are ordinary share-related transactions, including dividend payments to holders of its ordinary shares as well as share buybacks, acquisition activity, capital investments in its subsidiaries and certain corporate operating expenses. XL-Cayman's principal uses of liquidity are preference share related transactions, including dividend payments to its preference shareholders as well as preference share buybacks from time to time, interest and principal payments on debt, dividends to XL-Ireland and certain corporate operating expenses. Except for the debt securities assumed as part of the Catlin Acquisition as noted below, all of our outstanding debt securities were issued by XL-Cayman.

XL-Ireland's future cash flows largely depend on the availability of dividends or other permissible payments from subsidiaries to make principal and interest payments on debt, to pay operating expenses and ordinary shareholder dividends, to make capital investments in subsidiaries and to pay other obligations that may arise from time to time. The ability of our subsidiaries to pay dividends to us or return capital from shareholders' equity is limited by applicable laws and regulations of the various jurisdictions in which we operate, certain additional required regulatory approvals and financial covenants contained in our letters of credit and revolving credit facilities. The payment of dividends by our principal operating subsidiaries is regulated under the laws of various jurisdictions including Bermuda, the U.K., Ireland and Switzerland, certain insurance statutes of various states in the United States in which the principal operating subsidiaries are licensed to transact business, the other jurisdictions where we have regulated subsidiaries and regulations of the Society of Lloyd's. See Item 8, Note 25, "Statutory Financial Data," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014 for further discussion and details regarding the dividend capacity of our major operating subsidiaries. See also Item 1A, "Risk Factors - Our holding company structure and certain regulatory and other constraints affect our ability to pay dividends, make payments on our debt securities and make other payments," included in our Annual Report on Form 10-K for the year ended December 31, 2014. No assurance can be given that our subsidiaries will pay dividends in the future to XL-Ireland and XL-Cayman.

Under Irish law, share premium was required to be converted to "distributable reserves" for XL-Ireland to pay cash dividends and redeem and buyback shares following the redomestication transaction in which all of the ordinary shares of XL-Cayman were exchanged for all of the ordinary shares of XL-Ireland. On July 23, 2010, the Irish High Court approved XL-Ireland's conversion of share premium to $5.0 billion of distributable reserves, subject to the completion of certain formalities under Irish Company law. These formalities were completed in early August 2010. As of June 30, 2015, XL-Ireland had $2.8 billion in distributable reserves.

As of June 30, 2015, XL-Ireland and XL-Cayman held cash and investments, net of liabilities associated with cash sweeping arrangements, of $1.2 million and $0.6 billion, respectively, compared to $22.4 million and $0.9 billion, respectively, as of December 31, 2014.

Excluding the debt acquired as a result of the Catlin Acquisition, all of our outstanding debt as of June 30, 2015 was issued by XL-Cayman. The ability of XL-Cayman, like that of XL-Ireland, to obtain funds from its subsidiaries to satisfy any of its debts, including obligations under guarantees, is subject to certain contractual restrictions, applicable laws and statutory requirements of the various countries in which we operate, including, among others, Bermuda, the United States, Ireland, Switzerland and the United Kingdom. For details of the required statutory capital and surplus for our principal operating subsidiaries, see Item 8, Note 25, "Statutory Financial Data," included in our Annual Report on Form 10-K for the year ended December 31, 2014. See also the Consolidated Statements of Cash Flows in Item 1, Financial Statements included herein.

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Impact of Catlin Acquisition on Liquidity and Capital Resources

On May 1, 2015, we completed the Catlin Acquisition. Refer to Item 1, Note 3(a), "Acquisition and Disposals - Catlin Acquisition" to the Unaudited Consolidated Financial Statements included herein for additional information related to the acquisition.

The aggregate consideration for the transaction was $4.1 billion, comprised of $2.29 billion cash consideration and issuance of 49.9 million ordinary shares valued at $1.85 billion. As discussed in "Capital Resources" above, we had a short term bridge facility available to fund the cash consideration. On March 30, 2015, we issued $1.0 billion of subordinated notes, from which we received proceeds of $980.6 million, and subsequently terminated the bridge facility. The remaining $1.31 billion of cash consideration was funded through cash and cash equivalents on hand.

Following the close of the Catlin Acquisition and execution of the actions noted above, we believe that we have adequate capital resources in the aggregate, and that our subsidiaries have the ability to produce sufficient cash flows, to meet expected claims payments and operational expenses and to provide dividend payments to XL-Cayman and XL-Ireland. In turn, we anticipate that we will have adequate capital resources, or the access to capital resources, to meet our obligations, including but not limited to dividend payments to our shareholders, interest payments on our senior and subordinated notes and other liabilities as they come due.

Sources of Liquidity

As of June 30, 2015, on a consolidated basis we had cash and cash equivalents of approximately $2.8 billion as compared to approximately $2.5 billion as of December 31, 2014. We have three main sources of cash flows - those provided (used) by operating activities, investing activities and financing activities:

(U.S. dollars in thousands)	June 30, 2015			June 30, 2014
Operating activities	$	20,504		$	353,629
Investing activities	$	(349,375	)	$	1,569,409
Financing activities	$	685,803		$	(666,530	)
Effects of exchange rate changes on foreign currency cash	$	(37,905	)	$	13,799

Operating Cash Flows

Historically, cash receipts from operations that are typically derived from the receipt of investment income on our investment portfolio as well as the net receipt of premiums less claims and expenses related to our underwriting activities have generally provided sufficient funds to pay losses as well as operating expenses of our subsidiaries and to fund dividends payable by our subsidiaries to XL-Ireland and XL-Cayman. Our operating subsidiaries provide liquidity in that premiums are generally received months or even years before losses are paid under the policies related to such premiums. Premiums and acquisition expenses are settled based on terms of trade as stipulated by an underwriting contract, and generally are received within the first year of inception of a policy when the premium is written, but can be up to three years on certain reinsurance business assumed. Operating expenses are generally paid within a year of being incurred. Claims, especially for casualty business, may take a much longer time before they are reported and ultimately settled, requiring the establishment of reserves for unpaid losses and loss expenses. Therefore, the amount of claims paid in any one year is not necessarily related to the amount of net losses incurred, as reported in the consolidated statement of income.

During the six months ended June 30, 2015, net cash flows used in operating activities was $20.5 million compared to net cash flows provided by operating activities of $353.6 million for the same period in 2014. The decrease was driven by lower operating income due to the increases in expenses as a result of the Catlin Acquisition during the six months ended June 30, 2015 compared to the same period of 2014.

Investing Cash Flows

Generally, positive cash flow from operations and financing activities is invested in our investment portfolio, including affiliates, or the acquisition of subsidiaries.

Net cash used in investing activities was $349.4 million in the six months ended June 30, 2015 compared to net cash provided of $1,569.4 million for the same period in 2014. The decrease in cash flow is mainly attributable to the $2.29 billion cash consideration paid to Catlin shareholders for the Catlin Acquisition, offset by cash acquired of $1.27 billion for a net cash outflow of $1.02 billion, partially offset by additional inflows recorded in the current year due to the additional proceeds from sales of securities to align the investment portfolios of the acquired and legacy businesses.

Certain of our invested assets are held in trust and pledged in support of insurance and reinsurance liabilities as well as credit facilities. Such pledges are largely required by our operating subsidiaries that are "non-admitted" under U.S. state insurance regulations, in order for the U.S. cedant to receive statutory credit for reinsurance. Also included are Life Funds

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Withheld Assets as noted in Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary." Additionally, certain deposit liabilities and annuity contracts require the use of pledged assets. As further outlined in Item 1, Note 6, "Investments - Fixed Maturities, Short-Term Investments and Equity Securities - Pledged Assets," to the Unaudited Consolidated Financial Statements included herein, certain assets of the investment portfolio are pledged as collateral under our letter of credit facilities. As of June 30, 2015 and December 31, 2014, the Company had $18.4 billion and $15.2 billion in pledged assets, respectively. Of these pledged assets, we have determined in accordance with the accounting policy outlined in Item 1, Note 2, "Significant Accounting Policies," that cash in the amount of $135.6 million as of June 30, 2015 is restricted and has been disclosed as such in our consolidated balance sheet.

Financing Cash Flows

Cash flows related to financing activities include ordinary share-related transactions, the payment of dividends, the issue or repayment of preference ordinary shares, the issue or repayment of debt and deposit liability transactions. During the six months ended June 30, 2015, net cash flows provided by financing activities was $685.8 million, mainly due to the issuance of debt, partially offset by share buybacks and preferred dividends paid, compared to net cash used of $666.5 million for the same period in 2014, which was predominantly impacted by share buybacks. See "Other Key Focuses of Management - Capital Management" for information regarding the issuance of debt and share buyback activity.

In addition, the Company maintains credit facilities that provide liquidity. Details of these facilities are described below in "Capital Resources."

Capital Resources

As of June 30, 2015 and December 31, 2014, we had total shareholders' equity of $14.2 billion and $11.4 billion, respectively. In addition to ordinary share capital, we depend on external sources of financing to support our underwriting activities in the form of:

• debt;

• XL-Cayman and Catlin Insurance Company Ltd ("Catlin-Bermuda") preference shares;

• letter of credit facilities and other sources of collateral; and

• revolving credit facilities.

In particular, we require, among other things:

▪ sufficient capital to maintain our financial strength and credit ratings, as issued by several ratings agencies, at levels considered necessary by management to enable our key operating subsidiaries to compete;

▪ sufficient capital to enable our regulated subsidiaries to meet the regulatory capital levels required in the United States, the U.K., Bermuda, Ireland, Switzerland and other key markets;

▪ letters of credit and other forms of collateral that are required to be posted or deposited, as the case may be, by our operating subsidiaries that are "non-admitted" under U.S. state insurance regulations in order for the U.S. cedant to receive statutory credit for reinsurance. We also use letters of credit to support our operations at Lloyd's; and

▪ revolving credit facilities to meet short-term liquidity needs.

The following risks are associated with our requirement to renew or obtain new credit facilities:

▪ the credit available from banks may be reduced due to market conditions resulting in our need to pledge our investment portfolio to customers, which could result in a lower investment yield;

▪ we may be downgraded by one or more rating agencies, which could materially and negatively impact our business, financial condition, results of operations and/or liquidity; and

▪ the volume of business that our subsidiaries that are not admitted in the United States are able to transact could be reduced if we are unable to obtain letter of credit facilities at an appropriate amount.

Consolidation within the banking industry may result in the aggregate amount of credit provided to us being reduced. We attempt to mitigate this risk by identifying and/or selecting additional banks that can participate in the credit facilities upon renewal. See Item 1A, "Risk Factors - We may require additional capital in the future, which may not be available to us on satisfactory terms, on a timely basis or at all," included in our Annual Report on Form 10-K for the year ended December 31, 2014.

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The following table summarizes the components of our current capital resources as follows:

(U.S. dollars in thousands)	June 30, 2015		December 31, 2014
Non-controlling interests - Series D preference ordinary shares of XL-Cayman	$	345,000	$	345,000
Non-controlling interests - Series E preference ordinary shares of XL-Cayman	999,500		999,500
Non-controlling interests - non-controlling preference shares of Catlin Insurance Company Ltd. ("Catlin-Bermuda")	562,285		—
Non-controlling interests - Other	51,022		57,515
Ordinary share capital	12,247,298		10,033,751
Total ordinary shares and non-controlling interests	$	14,205,105	$	11,435,766
Notes payable and debt	2,726,455		1,662,580
Total	$	16,931,560	$	13,098,346

Ordinary Share Capital

The following table reconciles the opening and closing ordinary share capital positions as follows:

(U.S. dollars in thousands)	June 30, 2015			December 31, 2014
Ordinary shareholders’ equity – beginning of period	$	10,033,751		$	9,997,633
Net income (loss) attributable to ordinary shareholders	951,320			188,340
Share buybacks	(112,385		)	(801,953		)
Share issuances	1,857,048			6,406
Ordinary share dividends	(91,133		)	(172,080		)
Change in accumulated other comprehensive income	(408,284		)	747,801
Share-based compensation and other	16,981			67,604
Ordinary shareholders’ equity – end of period	$	12,247,298		$	10,033,751

Preferred Shares - Non-controlling Interest in Equity of Consolidated Subsidiaries

The Series D preference ordinary shares and the Series E preference ordinary shares were issued by XL-Cayman. As a result of the Catlin Acquisition, we also acquired the non-controlling preference shares issued by Catlin-Bermuda. Accordingly, these instruments represent non-controlling interests in our consolidated financial statements and are presented as non-controlling interest in equity of consolidated subsidiaries. As of both June 30, 2015 and December 31, 2014, the face values of the outstanding Series D and Series E preference ordinary shares were $345.0 million and $999.5 million, respectively. The value of the non-controlling preference shares issued by Catlin-Bermuda as of June 30, 2015 was $562.3 million.

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Debt

The following tables present our debt under outstanding securities and lenders' commitments as of June 30, 2015:

						Payments Due by Period
(U.S. dollars in thousands)	Commitment/ Debt (1)		In Use/ Outstanding (2)		Year of Expiry	Less than 1 Year		1 to 3 Years		3 to 5 Years		After 5 Years
2.30% Senior Notes	300,000		297,679		2018	—		—		300,000		—
5.75% Senior Notes	400,000		397,307		2021	—		—		—		400,000
6.375% Senior Notes	350,000		348,975		2024	—		—		—		350,000
4.45% Subordinated Notes	500,000		492,292		2025	—		—		—		500,000
6.25% Senior Notes	325,000		323,140		2027	—		—		—		325,000
Variable Rate Subordinated Notes, face amount €7m	7,794		7,301		2035	—		—		—		7,794
Variable Rate Subordinated Notes, face amount $27m	27,000		25,259		2036	—		—		—		27,000
Variable Rate Subordinated Notes, face amount $31m	31,300		29,281		2036	—		—		—		31,300
Variable Rate Subordinated Notes, face amount $10m	9,800		9,168		2036	—		—		—		9,800
Variable Rate Subordinated Notes, face amount €11m	12,248		11,473		2036	—		—		—		12,248
5.25% Senior Notes	300,000		296,228		2043	—		—		—		300,000
5.5% Subordinated Notes	500,000		488,352		2045	—		—		—		500,000
	$	2,763,142	$	2,726,455		$	—	$	—	$	300,000	$	2,463,142

_______________

(1)    Excluded from the table are revolving credit facilities of $1.7 billion and $1.6 billion as of June 30, 2015 and December 31, 2014, respectively. As of June 30, 2015 and December 31, 2014, $667.9 million and $606.1 million, respectively, were utilized under these facilities as letters of credit, leaving $1.0 billion and $968.9 million, respectively, available for use under the revolving credit facilities.

(2)    "In Use/Outstanding" data represent June 30, 2015 accreted values. "Payments Due by Period" data represents ultimate redemption values.

In addition, see Item 8, Note 15, "Notes Payable and Debt and Financing Arrangements," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014 for further information.

As of June 30, 2015, we had outstanding debt held by investors and debt capacity with banks as follows:

▪ available revolving credit capacity of approximately $1.0 billion; and

▪ senior and subordinated unsecured notes of approximately $2.6 billion issued by XL-Cayman. These notes require XL-Cayman to pay a fixed rate of interest during their terms. As of June 30, 2015, the outstanding issues of unsecured notes is as follows:

▪ $300 million senior notes due December 2018, with a fixed coupon of 2.30%. The notes are listed on the New York Stock Exchange. The notes were issued at 99.69% of the face amount and net proceeds were $296.6 million. Related expenses of the offering amounted to $2.5 million.

▪ $400 million senior notes due October 2021, with a fixed coupon of 5.75%. The notes are listed on the New York Stock Exchange. The notes were issued at 100.0% of the face amount and net proceeds were $395.7 million. Related expenses of the offering amounted to $4.3 million.

▪ $350 million senior notes due November 2024, with a fixed coupon of 6.375%. The notes are publicly traded. The notes were issued at 100.0% of the face amount and net proceeds were $347.8 million. Related expenses of the offering amounted to $2.2 million.

▪ $500 million subordinated notes due March 2025, with a fixed coupon of 4.45%. The notes are listed on the New York Stock Exchange. The notes were issued at 99.633% of the face amount and net proceeds were $492.2 million. Related expenses of the offering amounted to $5.9 million.

▪ $325 million senior notes due May 2027, with a fixed coupon of 6.25%. The notes are publicly traded. The notes were issued at 99.805% of the face amount and net proceeds were $321.9 million. Related expenses of the offering amounted to $2.5 million.

▪ $300 million senior notes due December 2043, with a fixed coupon of 5.25%. The notes are listed on the New York Stock Exchange. The notes were issued at 99.77% of the face amount and net proceeds were $296.0 million. Related expenses of the offering amounted to $3.3 million.

▪ $500 million subordinated notes due March 2045, with a fixed coupon of 5.5%. The notes are listed on the New York Stock Exchange. The notes were issued at 99.115% of the face amount and net proceeds were $488.4 million. Related expenses of the offering amounted to $7.2 million.

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▪ subordinated unsecured notes of approximately $82.5 million issued by Catlin Underwriting (formerly Wellington Underwriting plc). These notes require Catlin Underwriting to pay a variable rate of interest based on the rate on three-month deposits in U.S. dollars plus a margin of basis points. As of June 30, 2015, the outstanding subordinated unsecured notes are as follows:

▪ €7 million subordinated notes due March 2035, with the variable rate based on the three-month deposits in U.S. dollars plus a margin of 295 basis points. Interest is payable quarterly in arrears. The notes are redeemable at the discretion of the issuer.

▪ $27 million subordinated notes due March 2036, with the variable rate based on the three-month deposits in U.S. dollars plus a margin of 317 basis points. Interest is payable quarterly in arrears. The notes are redeemable at the discretion of the issuer.

▪ $31 million subordinated notes due September 2036, with the variable rate based on the three-month deposits in U.S. dollars plus a margin of 310 basis points. Interest is payable quarterly in arrears. The notes are redeemable at the discretion of the issuer.

▪ $10 million subordinated notes due September 2036, with the variable rate based on the three-month deposits in U.S. dollars plus a margin of 300 basis points. Interest is payable quarterly in arrears. The notes are redeemable at the discretion of the issuer.

▪ €11 million subordinated notes due September 2036, with the variable rate based on the three-month deposits in U.S. dollars plus a margin of 300 basis points. Interest is payable quarterly in arrears. The notes are redeemable at the discretion of the issuer.

Letter of Credit Facilities and other sources of collateral

As of June 30, 2015, we had eighteen letter of credit ("LOC") facilities in place with total availability of $4.9 billion, of which $2.6 billion was utilized.

						Amount of Commitment Expiration by Period
(U.S. dollars in thousands)	Commitment/ Debt		In Use/ Outstanding		Year of Expiry	Less than 1 Year		1 to 3 Years		3 to 5 Years		After 5 Years
LOC Facility (1) (2)	$	1,000,000	$	23,871	2018	$	—	$	—	$	1,000,000	$	—
LOC Facility (2)	1,000,000		690,010		2018	—		—		1,000,000		—
LOC Facility	600,000		157,902		Continuous	—		—		—		600,000
LOC Facility	250,000		133,063		Continuous	—		—		—		250,000
LOC Facility (3)	250,000		250,000		2015	—		250,000		—		—
LOC Facility (3)	200,000		200,000		2015	200,000		—		—		—
LOC Facility (3)	100,000		100,000		2016	—		100,000		—		—
LOC Facility	150,000		122,000		Continuous	—		—		—		150,000
LOC Facility	450,000		202,805		2016	—		450,000		—		—
LOC Facility	100,000		100,000		2018	—		—		100,000		—
LOC Facility	100,000		100,000		2018	—		—		100,000		—
LOC Facility	100,000		100,000		2018	—		—		100,000		—
LOC Facility	75,000		75,000		2018	—		—		75,000		—
LOC Facility (4)	75,000		45,000		2016	—		75,000		—		—
LOC Facility	50,000		32,670		2017	—		50,000		—		—
LOC Facility (4)	75,000		49,005		2016	—		75,000		—		—
LOC Facility	230,000		147,063		Continuous	—		—		—		230,000
LOC Facility	50,000		48,887		Continuous	—		—		—		50,000
LOC Facility	—		8,072		2015	8,072		—		—		—
Total LOC facilities	$	4,855,000	$	2,585,348		$	208,072	$	1,000,000	$	2,375,000	$	1,280,000

____________

(1) The unused portion of this credit facility of $976.1 million is available as revolving credit capacity as noted within our discussion of Debt above. See also the discussion regarding the Syndicated Credit Agreements (defined below).

(2) We have the option to increase the size of the facilities under the Syndicated Credit Agreements by an additional $500 million across both such facilities.

(3) We have the option to increase the maximum amount of letters of credit and revolving credit loans available under the 2013 Citi Agreements (defined below), with the lender's and issuing lender's consent.

(4) The unused portions of these credit facilities of $56.0 million is available as revolving credit capacity as noted within our discussion of Debt above.

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In November 2013, we (i) entered into two credit agreements (together, the "Syndicated Credit Agreements"), which provide for an aggregate amount of outstanding letters of credit and revolving credit loans of up to $2 billion, subject to certain options to increase the size of the facilities, and (ii) terminated the secured credit agreements dated March 25, 2011 and December 9, 2011, and the unsecured credit agreement dated December 9, 2011, which had provided for an aggregate amount of outstanding letters of credit and revolving credit loans of up to $3 billion.

The Syndicated Credit Agreements consist of (i) a secured credit agreement, which provides for the issuance of up to $1 billion of letters of credit, and (ii) an unsecured credit agreement, which provides for the issuance of up to $1 billion of letters of credit and revolving credit loans. We have the option to increase the maximum amount of letters of credit available by an additional $500 million across the facilities under the Syndicated Credit Agreements.

The commitments under the Syndicated Credit Agreements expire on, and such credit facilities are available until, the earlier of (i) November 22, 2018 and (ii) the date of termination in whole of the commitments upon an optional termination or reduction of the commitments by the account parties or upon the occurrence of certain events of default.

The availability of letters of credit under the secured portion of the Syndicated Credit Agreements is subject to a borrowing base requirement, determined on the basis of specified percentages of the face value of eligible categories of assets varying by type of collateral. In the event that such credit support is insufficient, we could be required to provide alternative security to cedants. This could take the form of insurance trusts supported by our investment portfolio or funds withheld (amounts retained by ceding companies to collateralize loss or premium reserves) using our cash resources or combinations thereof. The face amount of letters of credit required is driven by, among other things, loss development of existing reserves, the payment pattern of such reserves, the expansion of business written by us and the loss experience of such business.

On May 7, 2013, XL-Cayman entered into a credit agreement with Citicorp USA, Inc., as administrative agent and issuing lender, and the lenders party thereto, and a continuing agreement for standby letters of credit with Citibank, N.A. On May 13, 2013, May 15, 2013, May 19, 2015, June 1, 2015 and June 10, 2015, XL-Cayman entered into a first, second, third, fourth and fifth amendment, respectively, to such credit agreement (as amended, the "May 2013 Credit Agreement").

On August 6, 2013, XL-Cayman entered into a new credit agreement with Citicorp USA, Inc., as administrative agent and issuing lender, and the lenders party thereto and a continuing agreement for standby letters of credit with Citibank, N.A. On September 12, 2013, XL-Cayman entered into a first amendment to such credit agreement (as amended, the "August 2013 Credit Agreement").

Additionally, on November 4, 2013, XL-Cayman entered into a new credit agreement with Citicorp USA, Inc., as administrative agent and issuing lender, and the lenders party thereto and a continuing agreement for standby letters of credit with Citibank, N.A. (the "November 2013 Credit Agreement" and, together with the May 2013 Credit Agreement and the August 2013 Credit Agreement, the "2013 Citi Agreements").

Collectively, the 2013 Citi Agreements and the continuing agreements for standby letters of credit provide for issuance of letters of credit and revolving credit loans in an aggregate amount of up to $550 million. XL-Cayman has the option to increase the maximum amount of letters of credit and revolving credit loans available under the 2013 Citi Agreements with the lender's and issuing lender's consent.

The commitments under the 2013 Citi Agreements expire on, and such credit facilities are available until, the earlier of (i) June 20, 2017 (with respect to the May 2013 Credit Agreement), September 20, 2015 (with respect to the August 2013 Credit Agreement) and December 20, 2016 (with respect to the November 2013 Credit Agreement) and (ii) the date of termination in whole of the commitments upon an optional termination or reduction of the commitments by the account parties or upon the occurrence of certain events of default.

On December 30, 2014, we reduced the commitments available under a continuous letter of credit facility between XLIB and Citibank Europe plc from $750 million to $600 million simultaneous with XLIB entering into a continuous $150 million letter of credit facility with ING Bank N.V., London Branch.

As a result of the Catlin Acquisition, the Company has the following credit facilities that Catlin had previously entered into:

• A $450 million unsecured multi-bank facility available for utilization by certain subsidiaries of the Company and guaranteed by Green Holdings. The facility has a termination date of December 31, 2016.

• A bilateral facility available for utilization by Catlin-Bermuda, collateralized by pledged financial assets. As of June 30, 2015, $147 million of letters of credit were issued under this facility.

• A bilateral facility available for utilization by Catlin Re Switzerland Ltd, collateralized by pledged financial assets. As of June 30, 2015, $49 million of letters of credit were issued under this facility.

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• Four unsecured bilateral facilities available for utilization by Catlin-Bermuda and guaranteed by Green Holdings for Funds at Lloyd's purposes, amounting to a total of $375 million. One of the facilities has an expiration date of December 31, 2017, while the other three have expiration dates of December 31, 2018.

• An unsecured bilateral facility valued in Australian dollars at A$50 million, available for utilization by certain subsidiaries of Catlin and guaranteed by Green Holdings, for the purpose of providing collateral to Australian beneficiaries.

• Two unsecured bilateral revolving credit and letter of credit facilities, available for utilization by certain subsidiaries of Catlin and guaranteed by Green Holdings amounting to $150 million.

• A facility managed by Lloyd's, acting for Catlin Syndicate 2003. As of June 30, 2015, $8 million of letters of credit were issued under this facility.

• Catlin, Inc. has letters of credit amounting to $1 million issued for the benefit of various parties.

In addition to letters of credit, we have established insurance trusts in the United States that provide cedants with statutory credit for reinsurance under state insurance regulation in the United States.

We review current and projected collateral requirements on a regular basis, as well as new sources of collateral. Our objective is to maintain an excess amount of collateral sources over expected uses. We also review our liquidity needs on a regular basis.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

General

The following discussion should be read in conjunction with "Quantitative and Qualitative Disclosures about Market Risk," presented under Item 7A, "Quantitative and Qualitative Disclosures About Market Risk," included in our Annual Report on Form 10-K for the year ended December 31, 2014.

This risk management discussion and the estimated amounts generated from the sensitivity and VaR analyses presented in this document are forward-looking statements of market risk assuming certain adverse market conditions occur. Actual results in the future may differ materially from these estimated results due to, among other things, actual developments in the global financial markets and changes in the composition of our investment portfolio. The results of analysis used by us to assess and mitigate risk should not be considered projections of future events of losses. See Item 2, "Cautionary Note Regarding Forward-Looking Statements."

As described in Item 1, Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," and Note 6, "Investments," to the Unaudited Consolidated Financial Statements included herein, in connection with the Life Retro Arrangements, certain fixed maturities were reclassified from held to maturity to available for sale. All of the reclassified securities are included within the Life Funds Withheld Assets, along with certain other available for sale securities as defined in the sale and purchase agreement between XLIB and GreyCastle. The Life Funds Withheld Assets are managed pursuant to agreed upon investment guidelines that meet the contractual commitments of the XL ceding companies and applicable laws and regulations. All of the investment results associated with the Life Funds Withheld Assets ultimately accrue to GCLR. Because we no longer share in the risks and rewards of the underlying performance of the supporting invested assets, quantitative and qualitative disclosures about market risk exclude the Life Funds Withheld Assets.

Market risk represents the potential for loss due to adverse changes in the fair value of financial and other instruments. We are principally exposed to the following market risks: interest rate risk, foreign currency exchange rate risk, credit risk, equity price risk and other related market risks.

The majority of our market risk arises from the investment portfolio, which consists of fixed income securities, alternative investments, public equities, private investments, derivatives, other investments and cash, denominated in both U.S. and foreign currencies, which are sensitive to changes in interest rates, credit spreads, equity prices, foreign currency exchange rates and other related market risks. Our fixed income and equity securities are generally classified as available for sale, and, as such, changes in interest rates, credit spreads on corporate and structured securities, equity prices, foreign currency exchange rates or other related market instruments will have an immediate effect on comprehensive income and shareholders' equity but will not ordinarily have an immediate effect on net income. Nevertheless, changes in interest rates, credit spreads and defaults, equity prices and other related market instruments affect consolidated net income when, and if, a security is sold or impaired.

We may enter into derivatives to reduce risk or enhance portfolio efficiency. For example, we may use derivatives to hedge foreign exchange and interest rate risk related to our consolidated net exposures or to efficiently gain exposure to investments that are eligible under our Investment Policy. From time to time, we may also use instruments such as futures, options, interest rate swaps, total return swaps, credit default swaps and swaptions and foreign currency forward contracts to manage the risk of interest rate changes, credit deterioration, foreign currency exposures, and other market related exposures as well as to obtain exposure to a particular financial market. We seek to manage the risks associated with the use of derivatives through our comprehensive framework of investment decision authorities ("Authorities Framework"). Derivative instruments are carried at fair value with the resulting changes in fair value recognized in income in the period in which they occur. For further information, see Item 1, Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements included herein.

Interest Rate Risk (Excluding Life Funds Withheld Assets)

Interest rate risk is the price sensitivity of a fixed income security to changes in interest rates. Our fixed income portfolio is exposed to interest rate risk. Our liabilities are accrued at a static rate from an accounting standpoint. However, management considers the liabilities to have an economic exposure to interest rate risk and manages the net economic exposure to interest rate risk considering both assets and liabilities. Interest rate risk is managed within the context of our Strategic Asset Allocation ("SAA") process by specifying a SAA benchmark relative to the estimated duration of our liabilities and managing the fixed income portfolio relative to the benchmarks such that the overall economic effect of interest rate risk is within management's risk tolerance. Nevertheless, we remain exposed to interest rate risk with respect to our overall net asset position and more generally from an accounting standpoint since the assets are carried at fair value, while liabilities are accrued at a static rate. We may utilize derivative instruments via an interest rate overlay strategy to manage or optimize our duration and curve exposures.

In addition, while our debt is not carried at fair value and not adjusted for market changes, changes in market interest rates could have an impact on debt values at the time of any refinancing.

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As of June 30, 2015 and December 31, 2014, bond index futures outstanding had net long positions of $41.6 million and $410.2 million, respectively, and stock index futures outstanding had a net short position of $2.8 million and a net long position of $3.8 million, respectively. We may reduce our exposure to these futures through offsetting transactions, including options and forwards.

Foreign Currency Exchange Rate Risk (Excluding Life Funds Withheld Assets)

Many of our non-U.S. subsidiaries maintain both assets and liabilities in local currencies; therefore, foreign exchange risk is generally limited to net assets denominated in foreign currencies.

Foreign currency exchange rate gains and losses in our consolidated Statements of Income arise for accounting purposes when net assets or liabilities are denominated in foreign currencies that differ from the functional currency of those subsidiaries. While unrealized foreign exchange gains and losses on underwriting balances are reported in earnings, the offsetting unrealized gains and losses on invested assets are recorded as a separate component of shareholders' equity, to the extent that the asset currency does not match that entity's functional currency. This results in an accounting mismatch that will result in foreign exchange gains or losses in the consolidated statements of income depending on the movement in certain currencies. We have formed several branches with Euro and U.K. sterling functional currencies and continue to focus on attempting to limit exposure to foreign exchange risk.

Foreign currency exchange rate risk in general is reviewed as part of our risk management framework. Within the asset liability framework for the investment portfolio, we pursue a general policy of holding the assets and liabilities in the same currency and, as such, we are not generally exposed to the risks associated with foreign exchange movements within the investment portfolio, as currency impacts on the assets are generally matched by corresponding impacts on the related liabilities. However, locally-required capital levels are invested in local currencies in order to satisfy regulatory requirements and to support local insurance operations and are not matched by related liabilities. Foreign exchange contracts within the investment portfolio may be utilized to manage individual portfolio foreign exchange exposures, subject to investment management service providers' guidelines established by management. Where these contracts are not designated as specific hedges for financial reporting purposes, we record realized and unrealized gains and losses in income in the period in which they occur. These contracts generally have maturities of three months or less. We may also attempt to manage the foreign exchange volatility arising on certain transactions denominated in foreign currencies. These include, but are not limited to, premiums receivable, reinsurance contracts, claims payable and investments in subsidiaries.

The principal currencies creating our foreign exchange risk are the U.K. sterling, the Euro, the Swiss franc and the Canadian dollar. The following table provides more information on our net exposures to these principal foreign currencies as of June 30, 2015 and December 31, 2014:

(Foreign currency in millions)	June 30, 2015	December 31, 2014
Euro	201.5	129.7
U.K. Sterling	198.0	139.4
Swiss Franc	60.7	155.7
Canadian Dollar	338.2	190.4

Credit Risk (Excluding Life Funds Withheld Assets)

Credit risk relates to the uncertainty of an obligor's continued ability to make timely payments in accordance with the contractual terms of the instrument or contract. We are exposed to direct credit risk within our investment portfolio, through general counterparties, including customers and reinsurers, and through certain underwriting activities that include, but are not limited to, surety, workers' compensation, environmental and political risk and trade credit.

We have an established credit risk governance process delegated to the Credit Risk Committee, a subcommittee of the Enterprise Risk Management Committee. The governance process is designed to ensure that transactions and activities, individually and in the aggregate, are carried out within established risk tolerances. This process also recognizes the potential for clash event risk (multiple losses from multiple risk sources) that could arise from credit events owing to the identified credit risk embedded in certain underwriting businesses, as well as our investment activities and reinsurance relationships. In particular, certain of our underwriting activities expose us to indirect credit risk in that profitability of certain strategies can correlate with credit events at the issuer, industry or country level. We manage these risks through established underwriting policies that operate in accordance with established limit and escalation frameworks.

To manage our exposure to credit risk, we have established a credit risk framework that establishes tolerances for credit risk at various levels of granularity (counterparty, industry, country and underwriting business) and tolerances for credit risk arising from certain clash events. Credit risk capacity is allocated across our businesses and functional areas and regular

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reporting and aggregation activities are carried out to ensure compliance with our credit risk framework and related tolerances. Credit risk arising from credit sensitive underwriting activities is also managed via our underwriting limit framework. We manage credit risk within the investment portfolio through our Authorities Framework and established investment credit policies, which address the quality of obligors and counterparties, industry limits, and diversification requirements. Our exposure to market credit spreads primarily relates to market price and cash flow variability associated with changes in credit spreads.

Our credit risk framework establishes a 1% exceedance credit clash limit at a level not to exceed approximately 25% of Adjusted Tangible Capital in order to manage the direct and indirect credit exposures arising from underwriting and non-underwriting activities that could potentially be impacted in various degrees by a systemic credit event (e.g. our investment portfolio, credit sensitive underwriting activities, unsecured exposures arising from reinsurance recoverable counterparties, brokers and other obligor counterparties). If we were to deploy the full limit, there would be a 1% probability that an event would occur during the next year that would result in a net credit clash related loss in excess of the limit. See "Other Key Focuses of Management - Risk Management" for factors we consider in setting the credit clash risk tolerance as well as for factors that could cause a deviation between estimated and actual incurred losses.

Credit Risk – Investment Portfolio (Excluding Life Funds Withheld Assets)

Credit risk in the investment portfolio is the exposure to adverse changes in the creditworthiness of individual investment holdings, issuers, groups of issuers, industries and countries. A widening of credit spreads will increase the net unrealized loss position, will increase losses associated with credit-based derivatives where we assume credit exposure, and, if issuer credit spreads increase significantly for an extended period of time or it is a period of increasing defaults, will also likely result in higher OTTI charges. All else held equal, credit spread tightening will reduce net investment income associated with new purchases of fixed maturities. In addition, market volatility can make it difficult to value certain of our securities if trading becomes less frequent. As such, valuations may include assumptions or estimates that may have significant period to period changes that could have a material adverse effect on our consolidated results of operations or financial condition. The credit spread duration in our fixed income portfolio was 3.2 years as of June 30, 2015.

We manage credit risk in the investment portfolio, including fixed income, alternative and short-term investments, through the credit research performed by investment management service providers and our internal portfolio management staff. The management of credit risk in the investment portfolio is integrated in our credit risk management governance framework and the management of credit exposures and concentrations within the investment portfolio is carried out in accordance with our strategic asset allocation benchmark, risk policies, philosophies, appetites, limits and risk concentrations related to the investment portfolio. In the investment portfolio, we review on a regular basis our asset concentration, credit quality and adherence to our credit limit guidelines. Any issuer over its credit limits or experiencing financial difficulties or material credit quality deterioration or potentially subject to forthcoming credit quality deterioration is placed on a watch list for closer monitoring. Where appropriate, exposures are reduced or prevented from increasing.

The table below shows our aggregate fixed income portfolio by credit rating in percentage terms of our aggregate fixed income portfolio (consisting of corporate debt and U.S. Agency debt and related mortgage-backed securities having and including fixed maturities, short-term investments, cash and cash equivalents and net receivable/(payable) for investment sold/(purchased)) as of June 30, 2015:

	Percentage of Aggregated Fixed Income Portfolio (1)(2)
AAA	46.5	%
AA	21.7	%
A	21.6	%
BBB	7.7	%
BB or Below	2.2	%
NR	0.3	%
Total	100.0	%

____________

(1) The credit ratings above were principally determined based on the weighted average rating of the individual securities from Standard & Poor's, Moody's Investors Service and Fitch Ratings (where available). The credit ratings for U.S. Agency debt and related mortgage-backed securities, whether with implicit or explicit government support, reflect the credit quality rating of the U.S. government for the purpose of these calculations.

(2) Excludes Life Funds Withheld Assets.

As of June 30, 2015, the average credit quality of our aggregate fixed income investment portfolio was "Aa2(AA)." Our $13.5 billion portfolio of government and government related, agency, sovereign and cash holdings was rated "AA+," our $10.3 billion portfolio of corporates was rated "A," and our $8.1 billion structured securities portfolio was rated "AA+."

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We are closely monitoring our corporate financial bond holdings given the events of the global financial crisis. The table below summarizes our significant exposures (defined as bonds issued by financial institutions with an amortized cost in excess of $50.0 million) to corporate bonds of financial issuers including Covered Bonds held within our investment portfolio as of June 30, 2015, representing both amortized cost and net unrealized gains (losses):

	June 30, 2015
Issuer (by Global Ultimate Parent) (1)(2) (U.S. dollars in millions)	Weighted Average Credit Quality (3)	Amortized Cost		Unrealized Gain/ (Loss)
WELLS FARGO & COMPANY	A+	$	183.7	$	3.1
JPMORGAN CHASE & CO.	A	167.2		2.9
ROYAL BANK OF CANADA	AA+	163.4		0.5
THE GOLDMAN SACHS GROUP, INC.	A-	153.5		3.3
THE BANK OF NOVA SCOTIA	AA+	145.7		0.4
WESTPAC BANKING CORPORATION	AA+	140.6		2.4
CITIGROUP INC.	A-	139.7		4.0
BANK OF AMERICA CORPORATION	A-	135.2		1.6
RABOBANK NEDERLAND	AA-	124.9		3.5
UBS GROUP AG	AA-	120.7		2.1
COMMONWEALTH BANK OF AUSTRALIA	AA	114.1		1.5
THE TORONTO-DOMINION BANK	AA+	109.9		—
HSBC HOLDINGS PLC	A+	108.1		(0.3		)
LLOYDS BANKING GROUP PLC	AA+	105.8		3.1
THE PNC FINANCIAL SERVICES GROUP, INC.	A	97.2		0.9
NATIONAL AUSTRALIA BANK LIMITED	AA+	91.4		1.2
SVENSKA HANDELSBANKEN AB	AA	77.4		0.7
BB&T CORPORATION	A	75.5		0.5
BANK OF MONTREAL	AA	74.8		1.0
BNP PARIBAS	A+	71.3		0.6
AMERICAN EXPRESS COMPANY	A	71.1		0.9
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED	AA+	71.0		1.3
U.S. BANCORP	A+	69.7		0.3
DNB ASA	AA+	67.4		0.3
CREDIT SUISSE GROUP AG	A	66.0		1.4
MORGAN STANLEY	A-	64.7		(1.6		)
SPAREBANK 1 BOLIGKREDITT AS	AAA	62.1		(0.2		)
ING GROEP N.V.	AA-	59.6		1.6
NATIONAL BANK OF CANADA	AA+	59.3		0.5
BPCE	AA-	55.8		0.4
MITSUBISHI UFJ FINANCIAL GROUP, INC.	A	54.1		0.4
FEDERATION DES CAISSES DESJARDINS DU QUEBEC	AA	53.6		0.1
NORDEA BANK AB	AA-	51.6		—

____________

(1) Includes Covered Bonds.

(2) Excludes Life Funds Withheld Assets.

(3) The credit rating for each asset reflected above was principally determined based on the weighted average rating of the individual securities from Standard & Poor's, Moody's Investors Service and Fitch Ratings (where available). U.S. Agency debt and related mortgage-backed securities, whether with implicit or explicit government support, reflect the credit quality rating of the U.S. government for the purpose of these calculations

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As of June 30, 2015, the top 10 corporate financial holdings, which exclude government guaranteed and government sponsored enterprises, represented approximately 4.6% of the aggregate fixed income portfolio and approximately 14.3% of all corporate holdings. The top 10 corporate bond holdings listed below represent the direct exposure to the corporations listed below, including their subsidiaries, and exclude any securitized, credit enhanced and collateralized asset or mortgage-backed securities, cash and cash equivalents, pooled notes and any over-the-counter ("OTC") derivative counterparty exposures, if applicable, but does include Covered Bonds:

Top 10 Corporate Financial Holdings (1)(2)	Percentage of Aggregate Fixed Income Portfolio
WELLS FARGO & COMPANY	0.6%
JPMORGAN CHASE & CO.	0.5%
ROYAL BANK OF CANADA	0.5%
THE GOLDMAN SACHS GROUP, INC.	0.5%
CITIGROUP INC.	0.5%
THE BANK OF NOVA SCOTIA	0.5%
WESTPAC BANKING CORPORATION	0.5%
BANK OF AMERICA CORPORATION	0.4%
RABOBANK NEDERLAND	0.4%
UBS GROUP AG	0.4%

____________

(1) Corporate issuers include Covered Bonds.

(2) Excludes Life Funds Withheld Assets.

As of June 30, 2015, the top 5 corporate sector exposures listed below represented 24.4% of the aggregate fixed income investment portfolio and 74.7% of all corporate holdings.

Top 5 Sector Exposures (1) (U.S. dollars in millions)	Carrying Value		Percentage of Aggregate Fixed Income Portfolio
Financials (2)	$	3,167.1	10.0	%
Consumer, non-Cyclical	1,869.4		5.9	%
Industrial	924.0		2.9	%
Consumer, Cyclical	918.1		2.9	%
Utilities	843.6		2.7	%
Total	$	7,722.2	24.4	%

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(1) Excludes Life Funds Withheld Assets.

(2) Government-guaranteed securities and Covered Bonds have been excluded from the above figures.

We also have exposure to credit risk associated with our mortgage-backed and asset-backed securities. The table below shows the breakdown of the $8.1 billion structured securities portfolio, of which 88.4% is AAA rated:

(U.S. dollars in millions)	Carrying Value (1)		Percentage of Structured Portfolio
Agency RMBS	$	3,955.1	48.6	%
Other ABS (2)	2,376.3		29.2	%
CMBS	936.3		11.5	%
Core CDO (non-ABS CDOs and CLOs)	493.1		6.1	%
Non-Agency RMBS	374.5		4.6	%
Total	$	8,135.3	100.0	%

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(1) Excludes Life Funds Withheld Assets.

(2) Includes Covered Bonds.

Credit Risk – Other (Excluding Life Funds Withheld Assets)

Credit derivatives are purchased within our investment portfolio. From time to time, we may purchase credit default swaps to hedge an existing position or concentration of holdings. The credit derivatives are recorded at fair value. For further details with respect to our exposure to credit derivatives, see Item 1, Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements included herein.

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We have exposure to many different industries and counterparties, and routinely execute transactions with counterparties in the financial services industry, including brokers and dealers, commercial banks, investment banks, alternatives and other investment funds and other institutions. Many of these transactions expose us to credit risk in the event of default of our counterparty. In addition, with respect to secured transactions, our credit risk may be exacerbated when the collateral held by us cannot be sold or is liquidated at prices not sufficient to recover the full amount of the loan or derivative exposure that is due. We also have exposure to financial institutions in the form of unsecured debt instruments, derivative transactions, revolving credit facility and letter of credit commitments and equity investments. There can be no assurance that any such losses or impairments to the carrying value of these assets would not materially and adversely affect our business and results of operations.

With regard to unpaid losses and loss expenses recoverable and reinsurance balances receivable, we have credit risk should any of our reinsurers be unable or unwilling to settle amounts due to us; however, these exposures are not marked to market. For further information relating to reinsurer credit risk, see Item 2, "Management's Discussion and Analysis of Financial Condition and Results of Operations - Unpaid Losses and Loss Expenses Recoverable and Reinsurance Balances Receivable."

We are exposed to credit risk in the event of non-performance by the other parties to our derivative instruments in general; however, we do not anticipate non-performance. The difference between the notional principal amounts and the associated market value is our maximum credit exposure.

Equity Price Risk (Excluding Life Funds Withheld Assets)

Equity price risk is the potential loss arising from changes in the market value of equities. Our equity investment portfolio is exposed to equity price risk. As of June 30, 2015, our equity portfolio was approximately $1.1 billion as compared to $789.1 million at December 31, 2014. This excludes fixed income fund investments of $0.9 million and $79.2 million as of June 30, 2015 and December 31, 2014, respectively, that generally do not have the risk characteristics of equity investments but are treated as equity investments under U.S. GAAP. As of June 30, 2015 and December 31, 2014, our direct allocation to equity securities was 2.8% and 2.4%, respectively, of the total investment portfolio (including cash and cash equivalents, accrued investment income and net payable for investments purchased). We also estimate the equity risk embedded in certain alternative and private investments. Such estimates are derived from market exposures provided to us by certain individual fund investments and/or internal statistical analyses.

Other Market Risks (Excluding Life Funds Withheld Assets)

Our private investment portfolio is invested in limited partnerships and other entities that are not publicly traded. In addition to normal market risks, these positions may also be exposed to liquidity risk, risks related to distressed investments and risks specific to startup or small companies. As of June 30, 2015, our exposure to private investments, excluding unfunded commitments, was $546.0 million, representing 1.4% of the total investment portfolio (including cash and cash equivalents, accrued investment income and net payable for investments purchased) compared to $325.2 million as of December 31, 2014.

Our alternative investment portfolio, which is exposed to equity and credit risk as well as certain other market risks, had a total exposure of $1.8 billion representing approximately 4.6% of the total investment portfolio (including cash and cash equivalents, accrued investment income and net payable for investments purchased) as of June 30, 2015, as compared to December 31, 2014 when we had a total exposure of $1.7 billion representing approximately 5.6% of the total investment portfolio.

As noted above, we also invest in certain derivative positions that can be impacted by market value movements. For further details on derivative instruments, see Item 1, Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements included herein.

Sensitivity and Value-at-Risk Analysis (Excluding Life Funds Withheld Assets)

The table below summarizes our assessment of the estimated impact on the value of our investment portfolio as of June 30, 2015 associated with an immediate and hypothetical: +100bps increase in interest rates, a -10% decline in equity markets, a +100bps widening in spreads and a +10% widening in spreads. The table also reports the 95%, 1-year VaRs for our investment portfolios as of June 30, 2015, excluding foreign exchange. The interest rate, spread risk, and VaR shown in the table below exclude Life Funds Withheld Assets.

The table below also excludes the impact of foreign exchange rate risk on our investment portfolio. Our investment strategy incorporates asset-liability management, and, accordingly, any foreign exchange movements impact the assets and liabilities approximately equally. See "Foreign Currency Exchange Rate Risk" for further details. We consider the investment portfolio VaR estimated results excluding foreign exchange rate risk to be the more relevant and appropriate metric to consider when assessing the actual risk of the investment portfolio.

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The estimated results below also do not include any risk contributions from our various operating affiliates (strategic, investment manager or financial operating affiliates) or certain other investments that are carried at amortized cost.

(U.S. dollars in millions)	Interest Rate Risk (1)			Equity Risk (2)			Absolute Spread Risk (3)			Relative Spread Risk (4)			VaR (5) (6)
Total Investment Portfolio (7)	$	(1,134.9	)	$	(285.6	)	$	(1,081.6	)	$	(79.3	)	$	1,084.6
(I) Fixed Income Portfolio	(1,129.9		)	—			(1,041.0		)	(74.6		)	1,057.2
(a) Cash & Short Term Investments	(14.7		)	—			(9.8		)	(0.4		)	5.4
(b) Total Government Related	(486.1		)	—			(302.4		)	(9.1		)	431.7
(c) Total Corporate Credit	(364.7		)	—			(403.3		)	(40.7		)	374.9
(d) Total Structured Credit	(264.4		)	—			(325.5		)	(24.4		)	267.8
(II) Non-Fixed Income Portfolio	—			(285.6		)	—			—			352.7
(e) Equity Portfolio	—			(113.8		)	—			—			186.9
(f) Alternative Portfolio	—			(91.0		)	—			—			141.6
(g) Private Investments	—			(80.8		)	—			—			61.5

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(1) The estimated impact on the fair value of our fixed income portfolio of an immediate hypothetical +100 bps adverse parallel shift in global bond curves.

(2) The estimated impact on the fair value of our investment portfolio of an immediate hypothetical -10% change in the value of equity exposures in our equity portfolio, certain equity-sensitive alternative investments and private equity investments. This includes our estimate of equity risk embedded in the alternatives and private investment portfolio with such estimates utilizing market exposures provided to us by certain individual fund investments, internal statistical analyses, and/or various assumptions regarding illiquidity and concentrations.

(3) The estimated impact on the fair value of our fixed income portfolio of an immediate hypothetical +100 basis point increase in all global government related, corporate and structured security spreads to which our fixed income portfolio is exposed. This excludes exposure to credit spreads in our alternative investments, private investments and counterparty exposure.

(4) The estimated impact on the fair value of our fixed income portfolio of an immediate hypothetical +10% increase in all global government related, corporate and structured security spreads to which our fixed income portfolio is exposed. This excludes exposure to credit spreads in our alternative investments, private investments and counterparty exposure.

(5) The VaR results are based on a 95% confidence interval, with a one-year holding period, excluding foreign exchange rate risk. Our investment portfolio VaR as of June 30, 2015 is not necessarily indicative of future VaR levels as these are based on statistical estimates of possible price changes and, therefore, exclude other sources of investment return such as coupon and dividend income.

(6) The VaR results are the standalone VaRs, based on the prescribed methodology, for each component of our Total Investment Portfolio. The standalone VaRs of the individual components are non-additive, with the difference between the summation of the individual component VaRs and their respective aggregations being due to diversification benefits across the individual components. In the case of the VaR results for our Total Investment Portfolio, the results also include the impact associated with our Business and Other investments.

(7) Our Total Investment Portfolio also includes our Business and Other investments that do not form part of our Fixed Income Portfolio or Non-Fixed Income Portfolio. The individual results reported in the above table for our Total Investment Portfolio therefore represent the aggregate impact on our Fixed Income Portfolio, Non-Fixed Income Portfolio and the majority of our Other investments.

Stress Testing (Excluding Life Funds Withheld Assets)

VaR does not provide the means to estimate the magnitude of the loss in the 5% of occurrences when we expect the VaR level to be exceeded. To complement the VaR analysis based on normal market environments, we consider the impact on the investment portfolio in several different stress scenarios to analyze the effect of unusual market conditions. We establish certain stress scenarios that are applied to the actual investment portfolio. As these stress scenarios and estimated gains and losses are based on scenarios established by us, they will not necessarily reflect future stress events or gains and losses from such events. The results of the stress scenarios are reviewed on a regular basis to ensure they are appropriate, based on current shareholders' equity, market conditions and our total risk tolerance. It is important to note that, when assessing the risk of our investment portfolio, we do not take into account either the value or risk associated with the liabilities arising from our operations.

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Life Funds Withheld Assets

The table below shows the Life Funds Withheld Assets by credit rating in percentage terms as of June 30, 2015:

	Percentage of Aggregated Fixed Income Portfolio (1)
AAA	11.4	%
AA	31.3	%
A	31.0	%
BBB	25.1	%
BB or Below	1.2	%
Total	100.0	%

____________

(1) The credit ratings above were principally determined based on the weighted average rating of the individual securities from Standard & Poor's, Moody's Investors Service and Fitch Ratings (where available). The credit ratings for U.S. Agency debt and related mortgage-backed securities, whether with implicit or explicit government support, reflect the credit quality rating of the U.S. government for the purpose of these calculations.

As of June 30, 2015, the average credit quality of the Life Funds Withheld Assets was "A+".

As of June 30, 2015, the top 5 corporate sector exposures listed below represented 43.8% of the Life Funds Withheld Assets.

Top 5 Sector Exposures (U.S. dollars in millions)	Carrying Value		Percentage of Aggregate Fixed Income Portfolio
Financials (1)	$	722.7	14.5	%
Utilities	614.6		12.3	%
Consumer, non-Cyclical	374.0		7.5	%
Communications	237.2		4.8	%
Industrial	235.2		4.7	%
Total	$	2,183.7	43.8	%

____________

(1) Government-guaranteed securities and Covered Bonds have been excluded from the above figures.

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ITEM 4. CONTROLS AND PROCEDURES

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded, except as noted below, that our disclosure controls and procedures, as of the end of the period covered by this report, were effective and provided reasonable assurance that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934, as amended, is (i) recorded, processed, summarized, and reported within the time periods specified in the SEC's rules and forms, and (ii) accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

On May 1, 2015, the Company completed the Catlin Acquisition described in Item 1, Note 3(a), "Acquisition and Disposals - Catlin Acquisition" to the Unaudited Consolidated Financial Statements included herein. Catlin's assets constituted approximately 26.7% of the Company's consolidated assets as of June 30, 2015 and revenue constituted approximately 26.4% of the Company's revenues for the three month period ended June 30, 2015. At this time, we are in the process of evaluating internal control over financial reporting for the Catlin businesses acquired, and accordingly, in reliance upon SEC interpretive guidance related to recent acquisitions, we did not consider the Catlin businesses when we evaluated our internal control over financial reporting for purposes of our evaluation of disclosure controls and procedures.

Changes in Internal Control Over Financial Reporting

There have been no changes in internal control over financial reporting identified in connection with our evaluation required pursuant to Rules 13a-15 or 15d-15 promulgated under the Securities Exchange Act of 1934, as amended, that occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are subject to legal proceedings as described in our Annual Report on Form 10-K for the year ended December 31, 2014. There have been no material developments to such proceedings during the three months ended June 30, 2015.

We are subject to litigation and arbitration in the normal course of our business. These lawsuits and arbitrations principally involve claims on policies of insurance and contracts of reinsurance and are typical for us and for the property and casualty insurance and reinsurance industry in general. Such claims proceedings are considered in connection with our loss and loss expense reserves. Reserves in varying amounts may or may not be established in respect of particular claims proceedings based on many factors, including the legal merits thereof. In addition to litigation relating to insurance and reinsurance claims, we are subject to lawsuits and regulatory actions in the normal course of business that do not arise from or directly relate to claims on insurance or reinsurance policies. These types of actions typically involve, among other things, allegations of underwriting errors or misconduct, employment disputes, actions brought by or on behalf of shareholders or disputes arising from business ventures. The status of these legal actions is actively monitored by management.

Legal actions are subject to inherent uncertainties, and future events could change management's assessment of the probability or estimated amount of potential losses from pending or threatened legal actions. If management believes that, based on available information, it is at least reasonably possible that a material loss (or additional material loss in excess of any accrual) will be incurred in connection with any legal actions, we disclose an estimate of the possible loss or range of loss, either individually or in the aggregate, as appropriate, if such an estimate can be made, or disclose that an estimate cannot be made. Based on our assessment as of June 30, 2015, no such disclosures are considered necessary.

ITEM 1A. RISK FACTORS

Refer to Item 1A., "Risk Factors," in our Annual Report on Form 10-K for the year ended December 31, 2014 for further information.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Purchases of Equity Securities by the Issuer and Affiliate Purchasers

The following table provides information about purchases by the Company during the three months ended June 30, 2015 of its ordinary shares:

	Total Number of Shares Purchased(1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (1) (2)
April 1, 2015 to April 30, 2015	—	$	—	—	$	267.6	million
May 1, 2015 to May 31, 2015	1,255,312	$	37.35	1,255,312	$	220.7	million
June 1, 2015 to June 30, 2015	1,672,261	$	37.74	1,672,261	$	157.6	million
Total	2,927,573	$	37.57	2,927,573	$	157.6	million

____________

(1) Shares purchased in connection with the vesting of restricted shares granted under our restricted stock plan do not represent shares purchased as part of publicly announced plans or programs. All such purchases were made in connection with satisfying tax withholding obligations of those employees.

(2) For information regarding our share buyback activity see Part I, Item 2, "Management's Discussion and Analysis of Financial Condition and Results of Operations - Other Key Focuses of Management - Capital Management - Buybacks of Ordinary Shares," included herein.

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ITEM 6.	EXHIBITS
The following exhibits are filed as exhibits to this Quarterly Report:
10.1*	Letter of Assignment, dated May 27, 2015, between XL Group plc, XL Services (Bermuda) Ltd and Stephen Catlin.
10.2*	Second Amendment, dated May 1, 2015, to the Secured Credit Agreement, dated as of November 22, 2013, between XL Group plc, XLIT Ltd., X.L. America, Inc., XL Insurance (Bermuda) Ltd, XL Re Ltd, XL Re Europe plc, XL Insurance Company plc, XL Insurance Switzerland Ltd and XL Life Ltd, as Account Parties, XL Group plc, XLIT Ltd., X.L. America, Inc., XL Insurance (Bermuda) Ltd, XL Re Ltd and XL Life Ltd, as Guarantors, the Lenders party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent and The Bank of New York Mellon, as Collateral Agent, incorporated by reference to Exhibit 10.74 to the Company's Annual Report on Form 10-K (No. 1-10804) for the year ended December 31, 2014.
10.3*	Second Amendment, dated May 1, 2015, to the Unsecured Credit Agreement, dated as of November 22, 2013, between XL Group plc, XLIT Ltd., X.L. America, Inc., XL Insurance (Bermuda) Ltd, XL Re Ltd, XL Re Europe plc, XL Insurance Company plc, XL Insurance Switzerland Ltd and XL Life Ltd, as Guarantors, the Lenders party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent, incorporated by reference to Exhibit 10.76 to the Company's Annual Report on Form 10-K (No. 1-10804) for the year ended December 31, 2014.
10.4	Amended and Restated Directors Stock & Option Plan, incorporated by reference to Annex A to the Company's Definitive Proxy Statement on Schedule 14A (No. 1-10804) filed on March 20, 2015.
10.5*	Amendment, dated August 7, 2015, to the Letter of Assignment, dated May 27, 2015, between XL Group plc, XL Services (Bermuda) Ltd and Stephen Catlin.
12*	Statements regarding computation of ratios
23.1	Consent of PricewaterhouseCoopers Ltd., dated June 26, 2015, incorporated by reference to Exhibit 23.1 to the Current Report on Form 8-K (No. 1-10804) filed on June 26, 2015.
31*	Rule 13a-14(a)/15d-14(a) Certifications
32*	Section 1350 Certification
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document

* Filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date:	August 10, 2015
		XL Group plc
		(Registrant)
		/s/ MICHAEL S. MCGAVICK
		Name: Michael S. McGavick
		Title: Chief Executive Officer and Director
		XL Group plc
Date:	August 10, 2015
		/s/ PETER R. PORRINO
		Name: Peter R. Porrino
		Title: Executive Vice President and Chief Financial Officer
		XL Group plc

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EX-10.1

	O'Hara House
	One Bermudiana Road
	Hamilton HM 08
	PO Box HM 2245
	Hamilton HM JX
	Bermuda
	Phone	+ 1 441 292 8515
	Fax	+ 1 441 295 4846
	xlgroup.com

April 7, 2015    Exhibit 10.1

Private and Confidential

Stephen John Oakley Catlin

Windsong

15 Fairways Road

Warwick, Bermuda

WK-04

Dear Stephen:

Your Appointment

We are pleased to offer you employment with XL Group plc and XL Services (Bermuda) Ltd (collectively, “the Company”) in the role of Executive Deputy Chairman of the XL Group, subject to and conditional upon the closing of XL Group plc's acquisition of Catlin Group Limited (the “Acquisition”). Subject to clause 14 you will continue to be based in Bermuda.

This Letter of Appointment sets forth the general terms and conditions applicable to your employment with the Company and appointment to the XL Group Leadership Team (your “Appointment”) with effect from the date on which the Acquisition completes.

1. Duties

As Executive Deputy Chairman of the Company, you will report directly to Michael McGavick, the Chief Executive Officer of XL Group plc (the “CEO”).

You will be involved in strategic decisions regarding the XL Group and the discussions underpinning them. As such, you will chair the XL Group's Strategy Council and be a member of all Business Leadership councils, free to attend and contribute to any meeting you choose. Further, it is expected that you will act to support the CEO in many of the internal and external operations of the XL Group, particularly in the area of strategy development, and in the leveraging of your extensive sector network, including relationships with distribution (i.e. brokers), clients and regulators. As an externally visible leader of the XL Group, it is expected that the Company will require you to speak with authority on its behalf in a variety of audiences and assume some of the current and future trade association obligations and positions currently held by the CEO.

XL Services (Bermuda) Ltd    An XL Group company

During the Appointment and subject to clause 5 you shall devote the whole of your time and attention to the duties assigned to you and shall well and faithfully serve the Company and use your best efforts, skills and abilities to promote the interests of the Company and the wider XL Group and shall obey all reasonable and lawful directions given to you by or under the authority of the CEO and the Board.

You may be required in pursuance of your duties hereunder to perform services not only for the Company but also to serve as a director for such other Group Companies as may from time to time be required. The services hereunder are global in nature and shall be performed at the location or locations reasonably requested by the Company, but your principal work location shall be in Bermuda. You acknowledge that you may be required to travel to perform the services hereunder, which travel may be extensive.

2. Compensation

(a) Base Salary:

Your annual base salary will be USD $1,000,000, payable monthly in accordance with the Company’s regular payroll practices. Salaries will be paid on the 20^th of each month, unless these dates fall on weekends or public holidays when they will be paid on the last working day prior to these dates.

(b) Annual Incentive Plan

You will be eligible to participate in the Annual Incentive Plan (“AIP”). Any incentive bonus awarded under the AIP is at the sole discretion of the Company and will be based on your individual achievement, functional unit and corporate results and as otherwise approved by the Management Development and Compensation Committee (“MDCC”) of the Board. Such discretionary bonus, if any, will be paid to you at the time other AIP bonuses are paid (currently scheduled for March following the performance year), subject to your being actively employed on that date, and otherwise consistent with the terms of the AIP. Your target bonus opportunity is 200% of your annual base salary.

It should be noted that any annual incentive bonus under the AIP is at the sole discretion of the Company and may, therefore, vary below or above the target.

(c) Long Term Incentives:

You will be eligible to participate each year in the 1991 XL Group plc Performance Incentive Program (the “91 Plan”) or such replacement long term incentive plans and programs of the Company then in effect and at a level comparable to that of other similarly situated executives, subject to your being actively employed on the date such long term incentives are awarded, and as otherwise determined by the MDCC.  These incentives will be awarded to you at the Company’s sole discretion.  For informational purposes only, awards granted during this past year’s annual compensation process included non-qualified stock options and Performance Units. Provided you remain otherwise employed on the date of grant, your aggregate annual long-term target value will be $4,500,000 as of date of grant. Any award made under any long term incentive plan or program of the Company shall be subject to the terms and conditions of the applicable plan, program, grant or award agreement. It should be noted that any long term incentive awarded to you is at the sole discretion of the Company and may, therefore, vary below or above the target. You will receive your 2015 LTIP award, which shall have a grant date fair value of $4,500,000, as soon as practicable following the closing of the Acquisition.

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If the Appointment should terminate for any reason (including as a result of a repudiatory breach of contract by the Company) your rights under any Company long term incentive plan or program will be governed entirely by the terms of the 1991 Plan or replacement program, and the applicable grant or award agreements and you will not be entitled to any further or other compensation for any loss of any right or benefit or prospective right or benefit under any such plan, program, grant or award agreement which you may have enjoyed whether such compensation is claimed by way of damages for wrongful dismissal or other breach of contract or by way of compensation for loss of office or otherwise.

Without limiting the generality of the preceding paragraph, if your employment is terminated for any reason other than for Cause (as defined in the 1991 Plan and applicable award agreements) following the third anniversary of the commencement date of your employment with the Company, the termination will be considered to be a Retirement under the 1991 Plan and the applicable award agreements. In the case of a Retirement, (i) any unvested stock options currently held by you at the time of termination will continue to vest in accordance with the grant’s applicable vesting schedule, and the vested options would remain exercisable for the remainder of their 10-year term, and (ii) with respect to performance units that may be granted to you in the course of your employment, the target award amount of any such grant will be pro-rated for the number of days you have actually worked during the grant’s three-year performance measuring period, and such pro-rated amount will be adjusted at the end of such performance measurement period by multiplying it by the performance achievement percentage approved by MDCC at that time for the grant. The corresponding number of XL Group plc shares resulting from that calculation will be delivered to you in accordance with the applicable performance unit award agreement. (A description of the treatment of unvested equity upon various termination events under the 1991 Plan is attached hereto as Annex 1)

(d) Withholdings:

All payments required to be made by the Company to you in connection with the Appointment shall be subject to withholding of such amounts relating to taxes or other applicable contributions as the Company may reasonably determine should be withheld pursuant to any applicable law or regulation.

3. Benefits

The Company offers a comprehensive benefits package and currently pays all insurance, Bermudan government pension and payroll tax. During the term of your Appointment, you shall be entitled to participate in all employee benefit programs of the Company as are in effect from time to time and in which similarly situated senior executives of XL Services (Bermuda) Ltd are eligible to participate, as set out in the benefits schedule at Annex 2 to this Letter of Appointment. The Company reserves the right, at its absolute discretion, to amend the benefits provided or the terms on which they are provided.

(a) Medical, Life and LTD:

Major Medical, Dental, Life Insurance and Disability insurance coverage will be provided by the Company. Further details of the current terms are available from the Company’s Human Resources department.

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(b) Pension:

You are eligible to participate in the XL Group International Pension Plan on a voluntary basis. You will be provided with additional details of this plan when you meet with the Company’s Bermuda-based Human Resources Manager.

(c) Tax Preparation & Financial Consultation:

You are eligible for a quarterly consultation (including annual tax preparation, if applicable) with The AYCO Company.

(d) Officers’ Annual Medical:

You are entitled to an officer’s annual medical allowance. The first $2,000.00 is claimed through Argus Insurance. The Company extends coverage for an additional medical allowance of up to $1,000 per annum.

(e) Expenses:

You shall be reimbursed by the Company for all travelling hotel and other expenses properly incurred by you in the performance of your duties hereunder provided that such expenses are generally or specifically approved or authorised by the Board and are evidenced in such manner as the Company may reasonably specify from time to time.

4. Hours of Work

The Company's normal hours of work are from 9 a.m. to 5 p.m. from Monday to Friday, however it is expected that hours will be worked, before 9am or after 5pm, and on week-ends, as required in accordance with the needs of the business.

5. Vacation Entitlement

In accordance with the sick and vacation entitlement policy as set out in the Employee Handbook, you will be entitled to and 25 vacation days in addition to usual public holidays in Bermuda. Your vacation entitlements will be pro-rated based on the month of the year in which your employment begins and terminates.

6. Notice and Termination

You and the Company will give the other six (6) months written notice to terminate your employment.

The Appointment shall be subject to summary termination at any time by the Company by notice in writing if you are dismissed for Cause (as defined in the Separation Plan).

The Company reserves the right to give you pay in lieu of any notice of termination (whether given by the Company or by you).

During any period of notice of termination (whether given by the Company or by you), the Company shall be under no obligation to assign any duties to you and shall be entitled to exclude you from its

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premises, provided that this shall not affect your entitlement to receive your base salary and other contractual benefits.

Upon the termination of the Appointment howsoever arising you shall:

(a) at any time or from time to time thereafter upon the request of the Company, resign without claim for compensation from all offices held in the Company or any of the companies in the XL Group;

(b) deliver to the Board all Company property including Company ID entry cards, motor cars, car keys, credit cards and office entry keys, and if you should fail to do so the Company is hereby irrevocably authorised to appoint some person in your name and on your behalf to sign any documents and do any things necessary or requisite to give effect thereto.

7. Confidential Information; Intellectual Property

You agree that without the prior written consent of the Company, except to the extent required by an order of a court having competent jurisdiction or under subpoena from an appropriate government agency, you shall not disclose, except to the extent that such disclosure or use is directly related to and required by your performance of duties assigned to you pursuant to this Letter of Appointment, to any third person, or permit the use of for the benefit of any person, including yourself, or any entity other than the Company or the XL Group, any Confidential Information (as defined below) of which you are or become aware in the course of your Appointment (or previously became aware while chief Executive officer of Catlin Group Limited) whether or not such information is developed by you. Under all circumstances and at all times, you will take all appropriate steps to safeguard Confidential Information in your possession and to protect it against disclosure, misuse, espionage, loss and theft. "Confidential Information" shall mean (i) trade secrets, customer lists, information regarding product development, marketing plans, sales plans, management organization information (including data and other information relating to members of the Board of XL Group plc or any other XL Group company and its or their management), operating policies or manuals, business plans, financial records, or other financial, organizational, commercial, business, sales, marketing, technical, product or employee information relating to the XL Group, or any other information designated by the Company as confidential, proprietary, and/or a trade secret, or any other information relating to the XL Group, that you reasonably know or should know from the circumstances should be treated as confidential, or (ii) any information that the XL Group may receive belonging to customers, agents or others who do business with the XL Group, except to the extent that any such information previously has been disclosed to the public by the XL Group or is in the public domain (other than by reason of your violation of this clause 7). Upon the termination of your Appointment, you agree to return to the Company all files, papers, electronic or digital copies, and materials of any kind containing or relating to Confidential Information. You will be permitted to retain your electronic or physical rolodex of personal contacts, on condition that you follow appropriate Company information security protocols related to that retention.

In the event that you as part of your activities on behalf of the Company generate, author or contribute to any invention, design, new development, device, product, method of process (whether or not patentable or reduced to practice or comprising Confidential Information), any copyrightable work (whether or not comprising Confidential Information) or any other form of Confidential Information relating directly or indirectly to the business of the Company or any other company in the XL Group as now or hereinafter

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conducted (collectively, “Intellectual Property”), you acknowledge that such Intellectual Property is the sole and exclusive property of the Company and hereby assign all right title and interest in and to such Intellectual Property to the Company. You acknowledge and agree that all Intellectual Property that constitutes original works of authorship made by you within the scope of your employment and which are protectable by copyright are each intended to be a “work made for hire,” as that term is defined in Section 101 of the United States Copyright Act of 1976 (the “Act”), and shall be the sole and exclusive property of the Company and the Company shall be the sole and exclusive author within the meaning of the Act. If the copyright to any such copyrightable Intellectual Property does not qualify as a “work made for hire” under the Act, you agree to assign and hereby assigns to the Company, without further consideration, all of your right, title and interest in and to such copyrightable work product (and all other rights thereto) and will cooperate with the Company and its designees, at the Company’s sole expense, to secure, maintain and defend for the Company’s benefit copyrights and any extensions and renewals thereof on any and all such Intellectual Property.

8. Executive Severance Benefit Plan

As a member of the XL Group Leadership Team ("LT") you will be eligible to participate in the XL Group plc Executive Severance Benefit Plan (the “Severance Plan”) on condition that you enter into and comply with the restrictive covenants contained in Clause 9 of this Letter of Appointment. For the avoidance of doubt, when calculating any payment due under the Severance Plan credit will be given for pay and benefits received in lieu of notice or while on garden leave in accordance with clause 6 of this Letter of Appointment. A copy of the Severance Plan is attached at Annex 3 to this Letter of Appointment.

This Letter of Appointment and the restrictive covenants and confidentiality provisions in clauses 7 and 9 shall serve as a "Participation Agreement" as provided for under the Severance Plan. The Company acknowledges and agrees that subject to the Executive Vice President, Human Resources, receiving this Letter of Appointment, signed by you, and executing it on behalf of the Company, upon the commencement of your Appointment you will become a participant in the Severance Plan, and will be covered by and subject to all of the Severance Plan's provisions. Should the Company in its discretion terminate the Severance Plan prior to the date of your termination of employment without establishing a successor plan, you will no longer be a participant in the Severance Plan and the restrictions set forth in clause 9 of this Letter of Appointment shall cease to be effective as of the date the Severance Plan terminates.

9. Post-Termination Restrictions

The Company recognizes that as a member of the LT, you play a vital role in securing the XL Group's continuing success. Your role provides you with access to and use of confidential and proprietary information of the XL Group, which you also are entrusted to safeguard. In light of that, it would pose a serious risk of harm to the XL Group’s business and reputation if you were to become employed by a competitor immediately upon your leaving the Company for any reason, or if you attempted to solicit the XL Group's valued employees, clients, or customers within a reasonable time after your separation from employment. Therefore, and in consideration of your becoming eligible to receive Severance Pay and benefits under the Severance Plan, you hereby covenant and agree that:

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(a) Non-Competition and Non-Solicitation.

(i) Restriction on Work for a Competitor/Solicitation of Business:

While employed by the Company and for a one-year period following termination of your employment with the Company for any reason:

(1) You will not become employed by or associated with any entity, whether as a principal, advisor, partner, employee, agent, consultant, shareholder (other than as a shareholder of less than 5% of any publicly traded company) or in any other relationship or capacity, paid or unpaid, that is actively engaged in selling or providing, either directly or indirectly, in the United States, Bermuda, Greater London, or the Republic of Ireland, any products or services that are the same as or similar to insurance and reinsurance products or services that as of the date of your termination are being provided in those locations either directly or indirectly by the Company or any other entity in the XL Group.

(2) You will not, directly or indirectly contact, seek, entice, solicit, induce, persuade, divert or attempt to divert any business away from the XL Group, including any former, present or prospective customer, client, insured, vendor, supplier, investor, or business partner of which you have personal knowledge or with whom you are personally involved during your employment at the Company, with respect to any existing or proposed contractual or business arrangement with the XL Group, insurance or reinsurance product or service sold or provided by or to the XL Group during your employment, or any such product or service that is under development by the XL Group at the time your employment ends. It is presumed that by reason of your membership on the Leadership Team of XL Group that you have actual knowledge of any material business arrangement or contract, or any insurance or reinsurance products or services, whether currently provided or under development during, your employment. The restrictions in this paragraph shall not apply if you are expressly permitted to engage in the otherwise prohibited activity, in writing, by the Company, in its sole discretion, following its receipt of your written request before commencement of the activity.

(ii) Restriction on the Solicitation of Employees:

While employed by the Company and for a one-year period following termination of your employment with the Company for any reason, you will not directly or indirectly solicit, encourage or induce any employee of the XL Group to terminate employment with the XL Group, and will not directly or indirectly, either individually or as owner, agent, employee, consultant or otherwise, employ or offer employment to any person who was employed by the XL Group at the time of your termination from employment with the Company or at any time during the six-month period prior to your termination ("XL employee") to engage in any business

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activity which competes with the insurance or reinsurance businesses of the XL Group or its investment, corporate, or financial operations. You also agree that during the one-year period following your termination of employment with the Company for any reason, any subsequent employer's hiring of an XL employee into a position that reports directly or indirectly to you who was employed in a senior leadership capacity at the XL Group (currently defined to be the XL Leadership Team, Band E or Band D) will constitute a breach of this clause.

(b) Equitable Relief:

You acknowledge and agree that the covenants and obligations in clause 9(a) are reasonable and relate to special, unique and extraordinary matters and that, given the extensive knowledge of the XL Group's operations and Confidential Information that you have acquired and will continue to acquire, a violation of any of the terms of these covenants and undertakings will cause the XL Group irreparable injury for which adequate remedies are not available at law. Therefore, you agree that XL Group plc and such other entitles in the XL Group to which these provisions relate shall be entitled to an injunction, restraining order or such other equitable relief from a court of competent jurisdiction (without the requirement to post bond) restraining you from committing any violation of the covenants and obligations contained in clause 9(a). Further, the Company shall, to the extent permitted by applicable law and the Severance Plan, have no obligation to pay any amounts to you following any material violation of the covenants and undertakings contained in clause (a), including any unpaid payments or benefits outstanding under the Severance Plan. You also agree that, pursuant to the terms of the Severance Plan, the Company shall have the right to claw back any payments paid to you under the Severance Plan prior to its discovery of your material breach of clause 9(a). These remedies are cumulative and are in addition to any other rights and remedies the Company or any other entity in the XL Group may have at law or in equity or pursuant to the Severance Plan. If any court determines that any of the terms herein are unreasonable, invalid or unenforceable, the court may interpret, alter, amend or modify any or all of the terms to include as much of the scope, time period, and intent as will render the restrictions enforceable, and then as modified, enforce those terms.

(c) For the purposes of clauses 7 and 9 of this Appointment Letter, references to XL Group shall include Catlin Group Limited and its subsidiaries and affiliates, which will be part of the XL Group from the completion of the Acquisition.

10. Representations and Warranties – Disclosure of Interests

Except as a representative of the Company or with the prior written consent of the Board (which shall not be unreasonably withheld or delayed), you shall not during the Appointment engage or be concerned directly or indirectly in any business which competes with the business of the Company provided that you shall be permitted to hold shares or securities of a company any of whose shares or securities are quoted or dealt in on any recognised investment exchange provided that any such holding shall not exceed five per cent of the issued share capital of the company concerned and is held by way of bona fide investment only ("Investment").

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You represent and warrant to the Company that (a) the execution, delivery and performance of this Letter of Appointment by you does not and will not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which you are a party or by which you are bound, (b) except for agreements you have already provided to the Company, you are not a party to or bound by any employment agreement, noncompetition agreement, confidentiality agreement or similar agreement with any other person. Finally, you represent and warrant that you will not use the confidential or proprietary information of any other person in violation of any agreement or rights of others known to you in connection with your provision of services to the Company.

11. General Conditions

The benefits, terms and conditions of employment referred to in this letter are for Bermuda only and are not transferable. Should circumstances arise, requiring you to transfer employment to an XL Group company outside of Bermuda, your employment will be subject to the benefits, terms and conditions of the new location, based on 'home country' status.

Within your first month of employment you should expect to meet with a representative of the Human Resources team who will provide you with a variety of information for your review and/or completion.

You are required to notify Human Resources of any change to your personal circumstances (name, address, marital status, next of kin, and telephone number) to ensure that any data held is accurate and up to date.

As an employee of the Company, your employment is subject to the terms and conditions of the Employee Handbook, the XL Group Code of Conduct and Policy Statements, as well as other applicable Company policies and procedures that may be in effect from time to time (collectively “Company Policies”). Such Company Policies do not constitute a contract. Company Policies are guidelines provided for information purposes only and may be changed at any time at the sole discretion of the Company.

We confirm that the Company is not a party to any collective agreement.

Upon the commencement of your Appointment, this Letter of Appointment shall constitute your Statement of Employment in accordance with the Bermuda Employment Act 2000.

For the purposes of this Agreement “XL Group” shall mean XL Group plc and its subsidiaries and affiliates from time to time.

12. Notices

Any notice to be given in relation to this Letter of Appointment shall be in writing. Notices may be given by either party by personal delivery or post or by fax addressed to the other party at (in the case of the Company) XL Group plc's registered office for the time being and (in your case) your last known address and any such notice given by letter or fax shall be deemed to have been served at the time at which the letter was delivered personally or transmitted or if sent by post would be delivered in the ordinary course of post.

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13. Prior Agreements, Assignment and Modification

This Letter of Appointment and the documents referred to herein constitute the entire agreement between us and replace any prior agreements between us relating to the subject matter hereof whether implied, verbal, or in writing.

Please note that while the Company believes that its employment relationship with you will be mutually satisfying and beneficial, there is no contractual right or obligation for you to remain in our employment or for the Company to employ you for any specified period of time. Subject to the provisions in clauses 7 and 9 of this Letter of Appointment, which may not be modified or amended except by written instrument signed by you and the Chief Human Resources Officer of XL Group plc or his or her designee, the Company reserves the right to make reasonable changes to any of your terms of employment and conditions of employment, including compensation, benefits and other privileges at any time, at its sole discretion. The Company shall, as soon as practicable and no later than one month after the matters are prescribed or the change agreed, provide you with an amendment to the statement of employment containing particulars of the change or a revised statement which shall (in either case) be signed and dated by the employer and employee.

You understand that during the course of your Appointment, the XL Group may grow and/or expand through merger, acquisition or otherwise. You acknowledge that this Letter of Appointment and the rights and obligations of the parties hereto shall bind and inure to the benefit of any successor or successors of the Company by reorganization, merger, acquisition or otherwise and any assignee of all or substantially all of the Company's business or properties.

The expiration or termination of this Letter of Appointment, however arising, shall not operate to affect such of the provisions of this Letter of Appointment as are expressed to operate or have effect after that time and shall be without prejudice to any accrued rights or remedies of the parties.

The various provisions and sub-provisions of this Letter of Appointment are severable and if any provision or any identifiable part of any provision is held to be unenforceable by any court of competent jurisdiction then such unenforceability shall not affect the enforceability of the remaining provisions or identifiable parts of them.

14. Work Eligibility

Please note that this offer of employment and your continued employment in Bermuda is contingent upon and subject to you holding the requisite immigration status to work in Bermuda, and obtaining the approval of the Bermuda Department of Immigration, if applicable.

15. Governing Law and Jurisdiction

This Letter of Appointment shall be governed and construed under the laws of Bermuda, without reference to principles of conflicts or choice of law under which the law of any other jurisdiction would apply. In the event that one or more of the provisions of this Letter of Appointment shall become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not be affected thereby. Any dispute or controversy arising under or in connection with this Letter of Appointment shall be resolved by binding arbitration, to be held in the City of Stamford, Connecticut, and conducted in accordance with the Employment Arbitration Rules of the American

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Arbitration Association in effect at the time of the arbitration, and otherwise in accordance with the principles that would be applied by a court of law or equity.

16. Acceptance of Offer

You acknowledge that you have carefully read this Agreement, fully understand its provisions, and have had a sufficient opportunity to consider its effect, and have had an opportunity to consult with an attorney prior to executing this Letter of Appointment. You specifically acknowledge and agree that the purposes of the restrictions and undertakings contained in this Letter of Appointment is to protect the XL Group from unfair competition, including improper use of the XL Group’s confidential and proprietary information, and that the restrictions and undertakings herein are reasonable as to both scope and duration of application. You further acknowledge that you are knowingly and voluntarily entering into this Letter of Appointment.

If you accept this offer of employment you are required to sign and return the copy of this Letter of Appointment together with the enclosed documentation duly completed to the undersigned within two days of your acceptance.

We look forward to welcoming you to the XL Group and to a mutually rewarding relationship. In the meantime, if you have any questions regarding this letter, please do not hesitate to call me.

Yours sincerely,

/s/ Eileen Whelley	/s/ Kim Wilkerson
Eileen Whelley	Kim Wilkerson
Chief Human Resources Officer	(for and on behalf of
XL Group plc (for and on behalf of XL Group plc)	XL Services (Bermuda) Ltd)

Encs.

I confirm my acceptance of the terms and conditions of employment set out in this letter.

/s/ Stephen Catlin	5/27/15
Stephen Catlin	Date

11

ANNEX 1

12

ANNEX 2

BENEFITS & PERQUISITES

Stephen Catlin

Health Insurance:    The Argus Group - includes Major Medical and Dental

Life Insurance:    The Argus Group - Term Life (with Accidental Death and Dismemberment) with a benefit of three times salary (exclusive of bonus)

Long Term Disability: Company self-insures for first 180 days of disability. Thereafter, cover for long-term disability provided by Bermuda Life at 60% of pre-disability salary (exclusive of bonus)

Pension Plan:     Participation in XL Group International Pension Plan from first full month of employment.

Long-Term Incentives: Eligible for long-term incentive awards based on performance (and subject to the guidelines for the corporate long term incentive program)

Officers’ Annual Medical:    XL extends coverage for an additional medical allowance of up to $1,000.00 per annum. First $2,000.00 is claimed through Argus Insurance.

Annual Vacation:    25 days (subject to corporate vacation guidelines) * New employees who begin working for the Company after January 31^st in any year, are entitled to vacation on a pro rata basis.

Financial Consultation: Eligible for a quarterly consultation with the AYCO Company or another provider as designated by XL.

Professional Dues:    The Company will continue to pay the professional dues for those employees with professional designations

Tuition Reimbursement: If the study is required for the effective performance of the employee’s job, and if authorized in advance of registration, the cost is paid in accordance with our Professional Development & Educational Assistance Policy.

Matching of Donations:

Educational: The Company will match financial donations made by employees to approved educational institutions, up to a maximum of $1,000.00 per employee per annum

Fundraising: The Company will match the funds raised by employees if they participate in a fundraising activity, up to a maximum of $1,000.00 per employee per annum

Discounts on Personal Insurance:    The Argus Group offers discounts of 10% on Motor and Marine insurance

13

ANNEX 3

(Senior Executive Severance Benefit Plan)

14

EX-10.2

Exhibit 10.2

EXECUTION VERSION

SECOND AMENDMENT

SECOND AMENDMENT, dated as of May 1, 2015 (this “Amendment”), to the Secured Credit Agreement, dated as of November 22, 2013 (as amended, modified, restated and supplemented from time to time, the “Credit Agreement”), among XL GROUP PLC, an Irish public limited company (“XL Group”), XLIT LTD., an exempted company incorporated in the Cayman Islands with limited liability (“XLIT”), X.L. AMERICA, INC., a Delaware corporation (“XL America”), XL INSURANCE (BERMUDA) LTD, a Bermuda limited liability company (“XL Insurance (Bermuda)”), XL RE LTD, a Bermuda limited liability company (“XL Re”), XL RE EUROPE SE (formerly known as XL RE EUROPE PLC), a European company organized under the laws of Ireland (“XL Re Europe”), XL INSURANCE COMPANY SE (formerly known as XL INSURANCE COMPANY PLC), a European company domiciled in the United Kingdom (“XL Insurance”), XL INSURANCE SWITZERLAND LTD, a company limited by shares organized under the laws of Switzerland (“XL Switzerland”), and XL LIFE LTD, a Bermuda company (“XL Life” and together with XL Group, XLIT, XL America, XL Insurance (Bermuda), XL Re, XL Re Europe, XL Insurance and XL Switzerland, each an “Account Party” and collectively, the “Account Parties”; XL Group, XLIT, XL America, XL Insurance (Bermuda), XL Re and XL Life, each a “Guarantor” and collectively the “Guarantors”; the Account Parties and the Guarantors being collectively referred to as the “Obligors”), the several lenders from time to time parties thereto (the “Lenders”), JPMORGAN CHASE BANK, N.A., as administrative agent (the “Administrative Agent”), and THE BANK OF NEW YORK MELLON, as collateral agent (the “Collateral Agent”).

W I T N E S S E T H:

WHEREAS, pursuant to the Credit Agreement, the Lenders agreed to make certain extensions of credit to the Account Parties;

WHEREAS, the Account Parties have requested that certain provisions of the Credit Agreement be amended as set forth herein; and

WHEREAS, the Required Lenders are willing to agree to such amendments on the terms set forth herein;

NOW, THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties hereto hereby agree as follows:

SECTION 1.  Defined Terms; Rules of Construction. Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Credit Agreement. The rules of construction set forth in Section 1.02 of the Credit Agreement shall apply herein.

SECTION 2.  Amendments to Credit Agreement.

2.1    References Generally. On and after the Second Amendment Effective Date, each reference in the Credit Agreement (including references to the Credit Agreement as amended hereby) to “this Agreement” (and indirect references such as “hereunder”, “hereby”, “herein”, “hereof” and words of similar import) shall be deemed to be references to the Credit Agreement as amended hereby.

2.2    Amendments to Section 1.01 (Defined Terms) of the Credit Agreement.

(a)    The following defined terms shall be inserted in Section 1.01 of the Credit Agreement in appropriate alphabetical order:

“Implementation Agreement” means the Implementation Agreement dated as of January 9, 2015 by and among XL Group, Green Holdings Limited and Catlin Group Limited.”

“Second Amendment” means the Second Amendment, dated as of May 1, 2015, to this Agreement among the Obligors, the Administrative Agent, the Collateral Agent and the Lenders party thereto.”

“Second Amendment Effective Date” has the meaning assigned to such term in the Second Amendment, which date is, for the avoidance of doubt, May 1, 2015.”

(b)    The definition of “Federal Funds Effective Rate” is hereby amended by inserting the following at the end thereof: “; providedthat if the Federal Funds Effective Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement”.

(c)    The definition of “LIBO Rate” is hereby amended by inserting the following at the end of the first sentence thereof: “; providedthat if such rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement”.

2.3    Amendment to Section 2.11 (Taxes) of the Credit Agreement. Section 2.11 of the Credit Agreement is hereby amended by inserting the following clause (h):

“(h)    Solely for purposes of determining withholding Taxes imposed under FATCA, from and after the Second Amendment Effective Date, the Account Parties and the Administrative Agent shall treat (and the Lenders hereby authorize the Administrative Agent to treat) the Agreement as not qualifying as a “grandfathered obligation” within the meaning of Treasury Regulation Section 1.1471-2(b)(2)(i).”

2.4    Amendment to Section 7.03 (Liens) of the Credit Agreement. Clause (c) of Section 7.03 of the Credit Agreement is hereby amended and restated as follows:

“(c)    Liens existing (i) on the date hereof listed in Part B of Schedule II, (ii) Liens existing on the First Amendment Effective Date or, as expressly specified therein, incurred after the First Amendment Effective Date and, in each case, listed in Part D of Schedule II and (iii) Liens existing on the Second Amendment Effective Date listed in Part F of Schedule II, and, in each case, extension, renewal and replacement Liens upon the same property, provided that the principal amount secured by each Lien constituting such an extension, renewal or replacement Lien shall not exceed the amount secured by the Lien theretofore existing;”

2.5    Amendments to Section 7.07 (Indebtedness) of the Credit Agreement. Clause (c) of Section 7.07 of the Credit Agreement is hereby amended and restated as follows:

“(c)    other Indebtedness existing (i) on the date hereof described in Part A of Schedule II, (ii) other Indebtedness existing on the First Amendment Effective Date described in Part C of Schedule II and (iii) other Indebtedness existing on the Second Amendment Effective Date described in Part E of Schedule II, and, in each case, extensions, renewals and replacements of, or amendments, modifications, or supplements to, any such Indebtedness that, in each case, do not increase the outstanding principal amount thereof;”

2.6    Amendments to Schedules to the Credit Agreement. Schedule II to the Credit Agreement is hereby amended by inserting Exhibit A hereto as Part E and Part F of Schedule II, respectively.

SECTION 3.  Conditions to Effectiveness. This Amendment shall become effective on the date (the “Second Amendment Effective Date”) on which:

(a)    Amendment. The Administrative Agent shall have received a counterpart of this Amendment, in each case executed and delivered by a duly authorized officer of each of the Obligors, the Administrative Agent and Lenders constituting the Required Lenders.

(b)    Payment of Fees, Expenses. XL Group shall have paid all fees and expenses as required pursuant to Section 4 of this Amendment or otherwise in connection with this Amendment to the extent invoiced at least one Business Day prior to the Second Amendment Effective Date.

(c)    Representations and Warranties. The representations and warranties set forth in Section 5 of this Amendment shall be true and correct.

(d)    No Defaults. No Default or Event of Default shall have occurred and be continuing on the Second Amendment Effective Date, after giving effect to this Amendment.

(e)    Catlin Acquisition. XL Group’s acquisition of Catlin Group Limited shall have been consummated in accordance with the terms of the Implementation Agreement.

SECTION 4.  Payment of Fees and Expenses. The Obligors agree to pay or reimburse the Administrative Agent for all of its reasonable out-of-pocket costs and expenses incurred in connection with this Amendment, any other documents prepared in connection herewith and the transactions contemplated hereby, including, without limitation, the documented reasonable fees, charges and disbursements of counsel to the Administrative Agent.

SECTION 5.  Representations and Warranties. The Obligors hereby represent and warrant that (a) each of the representations and warranties set forth in Article IV of the Credit Agreement and in the other Credit Documents shall be, both immediately before and after giving effect to this Amendment, true and correct in all material respects as if made on and as of the Second Amendment Effective Date (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date), (b) both immediately before and after giving effect to this Amendment, no Default or Event of Default shall have occurred and be continuing and (c) this Amendment has been duly executed and delivered by each Obligor and constitutes a legal, valid and binding obligation of such Obligor, enforceable against such Obligor in accordance with its terms, except as such enforceability may be limited by (x) bankruptcy, insolvency, reorganization, moratorium, examination or similar laws of general applicability affecting the enforcement of creditors’ rights and (y) the application of general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

SECTION 6.  GOVERNING LAW; WAIVER OF JURY TRIAL; CONSENT TO SERVICE OF PROCESS. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AMENDMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AMENDMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.01 OF THE CREDIT AGREEMENT. NOTHING IN THIS AMENDMENT SHALL EFFECT THE RIGHT OF ANY PARTY TO THIS AMENDMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

SECTION 7.  Amendments; Execution in Counterparts. (a) This Amendment shall not constitute an amendment of any other provision of the Credit Agreement not referred to herein and shall not be construed as a waiver or consent to any further or future action on the part of the Obligors that would require a waiver or consent of the Lenders or the Administrative Agent. Except as expressly amended hereby, the provisions of the Credit Agreement are and shall remain in full force and effect and each of the Obligors agrees, with respect to each Credit Document to which it is a party, that all of its obligations, liabilities and indebtedness under such Credit Document, as amended hereby, including guarantees and grants of security interests, shall remain in full force and effect. This Amendment shall constitute a Credit Document for the purposes of the Credit Agreement and the other Credit Documents. This Amendment may not be amended nor may any provision hereof be waived, amended or modified except in writing signed by the Obligors, the Administrative Agent and the Required Lenders.

(b)    This Amendment may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page to this Amendment by telecopy or email shall be effective as delivery of a manually executed counterpart of this Amendment.

SECTION 8.  Integration. This Amendment and the other Credit Documents constitute the entire contract between and among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.

SECTION 9.  Severability. To the fullest extent permitted by law, any provision of this Amendment held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

[Signature Pages Follow]

XL GROUP PLC,

as an Account Party and a Guarantor

By /s/ Peter Porrino

Name: Peter Porrino

Title: EVP + CFO

U.S. Federal Tax Identification No.: 98-0665416

XLIT LTD.,

as an Account Party and a Guarantor

By /s/ Ronan Redmond

Name: Ronan Redmond

Title: Director

U.S. Federal Tax Identification No.: 98-0191089

X.L. AMERICA, INC.,

as an Account Party and a Guarantor

By /s/ Richard G. McCarty

Name: Richard G. McCarty

Title: Senior Vice President and Secretary

U.S. Federal Tax Identification No.: 06-1516268

[Second Amendment to Secured Credit Agreement – Signature Page]

XL INSURANCE COMPANY SE,

as an Account Party

By /s/ Graham Brady

Name: Graham Brady

Title: Company Secretary

U.S. Federal Tax Identification No.: 30-0479685

XL INSURANCE SWITZERLAND LTD,

as an Account Party

By /s/ Daniel Maurer

Name: Daniel Maurer

Title: Chairman

By /s/ Wouter Moritz

Name: Wouter Moritz

Title: Director

U.S. Federal Tax Identification No.: 30-0479676

XL LIFE LTD,

as an Account Party and a Guarantor

By/s/ Mark Twite

Name: Mark Twite

Title: Director

U.S. Federal Tax Identification No.: 98-0228561

[Second Amendment to Secured Credit Agreement – Signature Page]

XL INSURANCE (BERMUDA) LTD,

as an Account Party and a Guarantor

By/s/ C. Stanley Lee

Name: C. Stanley Lee

Title: Director

U.S. Federal Tax Identification No.: 98-0354869

XL RE LTD,

as an Account Party and a Guarantor

By/s/ Mark Twite

Name: Mark Twite

Title: Director

U.S. Federal Tax Identification No.: 98-0351953

XL RE EUROPE SE,

as an Account Party

By /s/ Alexandre Barrage

Name: Alexandre Barrage

Title: Chief Financial Officer

U.S. Federal Tax Identification No.: 30-0479679

[Second Amendment to Secured Credit Agreement – Signature Page]

LENDERS

JPMORGAN CHASE BANK, N.A.,

individually and as Administrative Agent

By /s/ Kristen M. Murphy

Name: Kristen M. Murphy

Title: Vice President

[Second Amendment to Secured Credit Agreement – Signature Page]

DEUTSCHE BANK AG NEW YORK BRANCH

By /s/ John S. McGill

Name: John S. McGill

Title: Director

By /s/ Virginia Cosenza

Name: Virginia Cosenza

Title: Vice President

[Second Amendment to Secured Credit Agreement – Signature Page]

THE ROYAL BANK OF SCOTLAND PLC

By /s/ Karen Beatty

Name: Karen Beatty

Title: Director

[Second Amendment to Secured Credit Agreement – Signature Page]

Barclays Bank PLC

By /s/ Alicia Borys

Name: Alicia Borys

Title: Vice President

[Second Amendment to Secured Credit Agreement – Signature Page]

CREDIT AGRICOLE CORPORATE &

INVESTMENT BANK

By /s/ Jorge Fries

Name: Jorge Fries

Title: Managing Director

By /s/ Juliette Cohen

Name: Juliette Cohen

Title: Managing Director

[Second Amendment to Secured Credit Agreement – Signature Page]

GOLDMAN SACHS BANK USA

By /s/ Jamie Minieri

Name: Jamie Minieri

Title: Authorized Signatory

[Second Amendment to Secured Credit Agreement – Signature Page]

HSBC Bank, USA, National Association

By /s/ Richard Herder

Name: Richard Herder

Title: Managing Director

[Second Amendment to Secured Credit Agreement – Signature Page]

ING BANK N.V., LONDON BRANCH

By /s/ M Groen

Name: M Groen

Title: Director

By /s/ M E R Sharman

Name: M E R Sharman

Title: Managing Director

[Second Amendment to Secured Credit Agreement – Signature Page]

Lloyds Bank plc

By /s/ Julia R. Franklin

Name: Julia R. Franklin - F014

Title: Vice President

By /s/ Daven Popat

Name: Daven Popat - P003

Title: Senior Vice President

[Second Amendment to Secured Credit Agreement – Signature Page]

THE BANK OF NEW YORK MELLON

By /s/ Michael Pensari

Name: Michael Pensari

Title: Managing Director

[Second Amendment to Secured Credit Agreement – Signature Page]

The Bank of Tokyo Mitsubishi UFJ, LTD

By /s/ O Cortez

Name: O. Cortez

Title: Vice President

[Second Amendment to Secured Credit Agreement – Signature Page]

BNP Paribas

By /s/ Nair P. Raghu

Name: Nair P. Raghu

Title: Vice President

By /s/ Riad Jafarov

Name: Riad Jafarov

Title: Vice President

[Second Amendment to Secured Credit Agreement – Signature Page]

COMMERZBANK AG, NEW YORK BRANCH

By /s/ Barry S. Feigenbaum

Name: Barry S. Feigenbaum

Title: Managing Director

By /s/ Christoph Zimmermann

Name: Christoph Zimmermann

Title: Vice President

[Second Amendment to Secured Credit Agreement – Signature Page]

MORGAN STANLEY BANK, N.A.

By /s/ Harry Comninellis

Name: Harry Comninellis

Title: Authorized Signatory

[Second Amendment to Secured Credit Agreement – Signature Page]

WELLS FARGO BANK, NATIONAL ASSOCIATION

By /s/ Grainne Pergolini

Name: Grainne Pergolini

Title: Managing Director

[Second Amendment to Secured Credit Agreement – Signature Page]

EXHIBIT A

SCHEDULE II

Part E

1. Letter of Credit Facility Agreement dated 4 April 2013 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd, Catlin Insurance Company (UK) Limited, Catlin Re Schweiz AG and Catlin Underwriting Agencies Limited (as Original Borrowers) and Barclays Bank Plc, Credit Suisse AG, JPMorgan Chase Bank, N.A., London Branch and Citibank Europe Plc (as Agent) in the sum of U.S.$450,000,000.

2. An unsecured Facilities Agreement dated 22 January 2014 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Underwriting Agencies Limited, Catlin Insurance Company Ltd. and Catlin Re Schweiz AG (as Original Borrowers) and Commonwealth Bank of Australia, London Branch in the sum of U.S.$75,000,000.

3. An unsecured Facilities Agreement (as Amended and Restated) dated 15 January 2014 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Underwriting Agencies Limited, Catlin Insurance Company Ltd. and Catlin Re Schweiz AG (as Original Borrowers) and Wells Fargo Bank, N.A. in the sum of U.S.$75,000,000.

4. An unsecured Facility Agreement dated 18 December 2013 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd. (as Original Borrower) and National Australia Bank Limited in the sum of U.S.$100,000,000.

5. An unsecured Facility Agreement dated 21 November 2013 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd. (as Original Borrower) and ING Bank N.V., London Branch (as the Bank) in the sum of U.S.$100,000,000.

6. An unsecured Facility Agreement dated 21 November 2013 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd. (as Original Borrower) and Standard Chartered Bank in the sum of U.S.$100,000,000.

7. An unsecured Facility Agreement dated 26 November 2013 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd. (as Original Borrower) and The Royal Bank of Scotland Plc in the sum of U.S.$75,000,000.

8. An unsecured Facility Agreement dated 30 June 2014 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd. and Catlin Underwriting Agencies Limited (as Original Borrowers) and the National Australia Bank Limited in the sum of A$50,000,000.

9. A secured Facility Agreement dated 28 July 2011 between Catlin Re Switzerland Ltd and Citibank, N.A. and Citibank Europe Plc in the sum of U.S.$50,000,000.

10. A secured Facility Agreement dated 9 November 2010 between Catlin Insurance Company Ltd. and Citibank Europe Plc in the sum of U.S.$230,000,000.

11. XLIT Ltd’s $500 million aggregate principal amount of 4.450% subordinated notes due 2025 and $500 million aggregate principal amount of 5.500% subordinated notes due 2045.

12. Wellington Underwriting PLC’s (A) US$27,000,000 Floating Rate Subordinated Notes due 2036; (B) €7,000,000 Floating Rate Subordinated Notes due 2035; (C) US$31,300,000 Floating Rate Subordinated Notes due 2036; (D) US$9,800,000 Floating Rate Subordinated Notes due 2036 and (E) €11,000,000 Floating Rate Subordinated Notes due 2036.

13. Catlin Finance (UK) Limited’s US$475,000,000 Long-Dated Subordinated Guaranteed Loan Notes subject to and with the benefit of a loan note deed made by way of deed poll by Catlin Finance (UK) Limited, dated June 27, 2007, and an irrevocable guarantee agreement made by way of deed poll by Catlin (North American) Holdings Limited dated June 27, 2007.

Part F

1. Reinsurance Deposit and Securities Portfolio Security Agreement by and between Catlin Re Switzerland Ltd, as Chargor, Citibank, N.A., as Custodian, and Citibank Europe Plc, as Bank, dated July 28, 2011.

2. Reinsurance Deposit and Securities Portfolio Security Agreement by and between Catlin Insurance Company Ltd., as Chargor, Citibank, N.A., as Custodian, and Citibank Europe Plc, as Bank, dated November 9, 2010.

EX-10.3

Exhibit 10.3

EXECUTION VERSION

SECOND AMENDMENT

SECOND AMENDMENT, dated as of May 1, 2015, 2015 (this “Amendment”), to the Unsecured Credit Agreement, dated as of November 22, 2013 (as amended, modified, restated and supplemented from time to time, the “Credit Agreement”), among XL GROUP PLC, an Irish public limited company (“XL Group”), XLIT LTD., an exempted company incorporated in the Cayman Islands with limited liability (“XLIT”), X.L. AMERICA, INC., a Delaware corporation (“XL America”), XL INSURANCE (BERMUDA) LTD, a Bermuda limited liability company (“XL Insurance (Bermuda)”), XL RE LTD, a Bermuda limited liability company (“XL Re”), XL RE EUROPE SE (formerly known as XL RE EUROPE PLC), a European company organized under the laws of Ireland (“XL Re Europe”), XL INSURANCE COMPANY SE (formerly known as XL INSURANCE COMPANY PLC), a European company domiciled in the United Kingdom (“XL Insurance”), XL INSURANCE SWITZERLAND LTD, a company limited by shares organized under the laws of Switzerland (“XL Switzerland”), and XL LIFE LTD, a Bermuda company (“XL Life” and together with XL Group, XLIT, XL America, XL Insurance (Bermuda), XL Re, XL Re Europe, XL Insurance and XL Switzerland, each an “Account Party” and collectively, the “Account Parties”; XL Group, XLIT, XL America, XL Insurance (Bermuda), XL Re and XL Life, each a “Guarantor” and collectively the “Guarantors”; the Account Parties and the Guarantors being collectively referred to as the “Obligors”), the several lenders from time to time parties thereto (the “Lenders”) and JPMORGAN CHASE BANK, N.A., as administrative agent (the “Administrative Agent”).

W I T N E S S E T H:

WHEREAS, pursuant to the Credit Agreement, the Lenders agreed to make certain extensions of credit to the Account Parties;

WHEREAS, the Account Parties have requested that certain provisions of the Credit Agreement be amended as set forth herein; and

WHEREAS, the Required Lenders are willing to agree to such amendments on the terms set forth herein;

NOW, THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties hereto hereby agree as follows:

SECTION 1.  Defined Terms; Rules of Construction. Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Credit Agreement. The rules of construction set forth in Section 1.02 of the Credit Agreement shall apply herein.

SECTION 2.  Amendments to Credit Agreement.

2.1    References Generally. On and after the Second Amendment Effective Date, each reference in the Credit Agreement (including references to the Credit Agreement as amended hereby) to “this Agreement” (and indirect references such as “hereunder”, “hereby”, “herein”, “hereof” and words of similar import) shall be deemed to be references to the Credit Agreement as amended hereby.

2.2    Amendments to Section 1.01 (Defined Terms) of the Credit Agreement.

(a)    The following defined terms shall be inserted in Section 1.01 of the Credit Agreement in appropriate alphabetical order:

“Implementation Agreement” means the Implementation Agreement dated as of January 9, 2015 by and among XL Group, Green Holdings Limited and Catlin Group Limited.”

“Second Amendment” means the Second Amendment, dated as of May 1, 2015, to this Agreement among the Obligors, the Administrative Agent and the Lenders party thereto.”

“Second Amendment Effective Date” has the meaning assigned to such term in the Second Amendment, which date is, for the avoidance of doubt, May 1, 2015.”

(b)    The definition of “Federal Funds Effective Rate” is hereby amended by inserting the following at the end thereof: “; providedthat if the Federal Funds Effective Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement”.

(c)    The definition of “LIBO Rate” is hereby amended by inserting the following at the end of the first sentence thereof: “; providedthat if such rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement”.

2.3    Amendment to Section 2.19 (Taxes) of the Credit Agreement. Section 2.19 of the Credit Agreement is hereby amended by inserting the following clause (h):

“(h)    Solely for purposes of determining withholding Taxes imposed under FATCA, from and after the Second Amendment Effective Date, the Account Parties and the Administrative Agent shall treat (and the Lenders hereby authorize the Administrative Agent to treat) the Agreement as not qualifying as a “grandfathered obligation” within the meaning of Treasury Regulation Section 1.1471-2(b)(2)(i).”

2.4    Amendment to Section 7.03 (Liens) of the Credit Agreement. Clause (c) of Section 7.03 of the Credit Agreement is hereby amended and restated as follows:

“(c) Liens existing (i) on the date hereof listed in Part B of Schedule II, (ii) Liens existing on the First Amendment Effective Date or, as expressly specified therein, incurred after the First Amendment Effective Date and, in each case, listed in Part D of Schedule II and (iii) Liens existing on the Second Amendment Effective Date listed in Part F of Schedule II, and, in each case, extension, renewal and replacement Liens upon the same property, provided that the principal amount secured by each Lien

constituting such an extension, renewal or replacement Lien shall not exceed the amount secured by the Lien theretofore existing;”

2.5    Amendments to Section 7.07 (Indebtedness) of the Credit Agreement. Clause (c) of Section 7.07 of the Credit Agreement is hereby amended and restated as follows:

“(c)    other Indebtedness existing (i) on the date hereof described in Part A of Schedule II, (ii) other Indebtedness existing on the First Amendment Effective Date described in Part C of Schedule II and (iii) other Indebtedness existing on the Second Amendment Effective Date described in Part E of Schedule II, and, in each case, extensions, renewals and replacements of, or amendments, modifications, or supplements to, any such Indebtedness that, in each case, do not increase the outstanding principal amount thereof;”

2.6    Amendments to Schedules to the Credit Agreement. Schedule II to the Credit Agreement is hereby amended by inserting Exhibit A hereto as Part E and Part F of Schedule II, respectively.

SECTION 3.  Conditions to Effectiveness. This Amendment shall become effective on the date (the “Second Amendment Effective Date”) on which:

(a)    Amendment. The Administrative Agent shall have received a counterpart of this Amendment, in each case executed and delivered by a duly authorized officer of each of the Obligors, the Administrative Agent and Lenders constituting the Required Lenders.

(b)    Payment of Fees, Expenses. XL Group shall have paid all fees and expenses as required pursuant to Section 4 of this Amendment or otherwise in connection with this Amendment to the extent invoiced at least one Business Day prior to the Second Amendment Effective Date.

(c)    Representations and Warranties. The representations and warranties set forth in Section 5 of this Amendment shall be true and correct.

(d)    No Defaults. No Default or Event of Default shall have occurred and be continuing on the Second Amendment Effective Date, after giving effect to this Amendment.

(e)    Catlin Acquisition. XL Group’s acquisition of Catlin Group Limited shall have been consummated in accordance with the terms of the Implementation Agreement.

SECTION 4.  Payment of Fees and Expenses. The Obligors agree to pay or reimburse the Administrative Agent for all of its reasonable out-of-pocket costs and expenses incurred in connection with this Amendment, any other documents prepared in connection herewith and the transactions contemplated hereby, including, without limitation, the documented reasonable fees, charges and disbursements of counsel to the Administrative Agent.

SECTION 5.  Representations and Warranties. The Obligors hereby represent and warrant that (a) each of the representations and warranties set forth in Article IV of the Credit Agreement and in the other Credit Documents shall be, both immediately before and after giving effect to this Amendment, true and correct in all material respects as if made on and as of the Second Amendment Effective Date (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date), (b) both immediately before and after giving effect to this Amendment, no Default or Event of Default shall have occurred and be continuing and (c) this

Amendment has been duly executed and delivered by each Obligor and constitutes a legal, valid and binding obligation of such Obligor, enforceable against such Obligor in accordance with its terms, except as such enforceability may be limited by (x) bankruptcy, insolvency, reorganization, moratorium, examination or similar laws of general applicability affecting the enforcement of creditors’ rights and (y) the application of general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

SECTION 6.  GOVERNING LAW; WAIVER OF JURY TRIAL; CONSENT TO SERVICE OF PROCESS. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AMENDMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AMENDMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.01 OF THE CREDIT AGREEMENT. NOTHING IN THIS AMENDMENT SHALL EFFECT THE RIGHT OF ANY PARTY TO THIS AMENDMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

SECTION 7.  Amendments; Execution in Counterparts. (a) This Amendment shall not constitute an amendment of any other provision of the Credit Agreement not referred to herein and shall not be construed as a waiver or consent to any further or future action on the part of the Obligors that would require a waiver or consent of the Lenders or the Administrative Agent. Except as expressly amended hereby, the provisions of the Credit Agreement are and shall remain in full force and effect and each of the Obligors agrees, with respect to each Credit Document to which it is a party, that all of its obligations, liabilities and indebtedness under such Credit Document, as amended hereby, including guarantees, shall remain in full force and effect. This Amendment shall constitute a Credit Document for the purposes of the Credit Agreement and the other Credit Documents. This Amendment may not be amended nor may any provision hereof be waived, amended or modified except in writing signed by the Obligors, the Administrative Agent and the Required Lenders.

(b)    This Amendment may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page to this Amendment by telecopy or email shall be effective as delivery of a manually executed counterpart of this Amendment.

SECTION 8.  Integration. This Amendment and the other Credit Documents constitute the entire contract between and among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.

SECTION 9.  Severability. To the fullest extent permitted by law, any provision of this Amendment held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be

ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

[Signature Pages Follow]

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their respective proper and duly authorized officers as of the day and year first above written.

XL GROUP PLC,

as an Account Party and a Guarantor

By /s/ Peter Porrino

Name: Peter Porrino

Title: EVP + CFO

U.S. Federal Tax Identification No.: 98-0665416

XLIT LTD.,

as an Account Party and a Guarantor

By /s/ Ronan Redmond

Name: Ronan Redmond

Title: Director

U.S. Federal Tax Identification No.: 98-0191089

X.L. AMERICA, INC.,

as an Account Party and a Guarantor

By /s/ Richard G. McCarty

Name: Richard G. McCarty

Title: Senior Vice President and Secretary

U.S. Federal Tax Identification No.: 06-1516268

[Second Amendment to Unsecured Credit Agreement – Signature Page]

XL INSURANCE COMPANY SE,

as an Account Party

By /s/ Graham Brady

Name: Graham Brady

Title: Company Secretary

U.S. Federal Tax Identification No.: 30-0479685

XL INSURANCE SWITZERLAND LTD,

as an Account Party

By /s/ Daniel Maurer

Name: Daniel Maurer

Title: Chairman

By /s/ Wouter Moritz

Name: Wouter Moritz

Title: Director

U.S. Federal Tax Identification No.: 30-0479676

XL LIFE LTD,

as an Account Party and a Guarantor

By/s/ Mark Twite

Name: Mark Twite

Title: Director

U.S. Federal Tax Identification No.: 98-0228561

[Second Amendment to Unsecured Credit Agreement – Signature Page]

XL INSURANCE (BERMUDA) LTD,

as an Account Party and a Guarantor

By/s/ C. Stanley Lee

Name: C. Stanley Lee

Title: Director

U.S. Federal Tax Identification No.: 98-0354869

XL RE LTD,

as an Account Party and a Guarantor

By/s/ Mark Twite

Name: Mark Twite

Title: Director

U.S. Federal Tax Identification No.: 98-0351953

XL RE EUROPE SE,

as an Account Party

By /s/ Alexandre Barrage

Name: Alexandre Barrage

Title: Chief Financial Officer

U.S. Federal Tax Identification No.: 30-0479679

[Second Amendment to Unsecured Credit Agreement – Signature Page]

LENDERS

JPMORGAN CHASE BANK, N.A.,

individually and as Administrative Agent

By /s/ Kristen M. Murphy

Name: Kristen M. Murphy

Title: Vice President

[Second Amendment to Unsecured Credit Agreement – Signature Page]

DEUTSCHE BANK AG NEW YORK BRANCH

By /s/ John S. McGill

Name: John S. McGill

Title: Director

By /s/ Virginia Cosenza

Name: Virginia Cosenza

Title: Vice President

[Second Amendment to Unsecured Credit Agreement – Signature Page]

THE ROYAL BANK OF SCOTLAND PLC

By /s/ Karen Beatty

Name: Karen Beatty

Title: Director

[Second Amendment to Unsecured Credit Agreement – Signature Page]

Barclays Bank PLC

By /s/ Alicia Borys

Name: Alicia Borys

Title: Vice President

[Second Amendment to Unsecured Credit Agreement – Signature Page]

`

CREDIT AGRICOLE CORPORATE &

INVESTMENT BANK

By /s/ Jorge Fries

Name: Jorge Fries

Title: Managing Director

By /s/ Juliette Cohen

Name: Juliette Cohen

Title: Managing Director

[Second Amendment to Unsecured Credit Agreement – Signature Page]

GOLDMAN SACHS BANK USA

By /s/ Jamie Minieri

Name: Jamie Minieri

Title: Authorized Signatory

[Second Amendment to Unsecured Credit Agreement – Signature Page]

HSBC Bank, USA, National Association

By /s/ Richard Herder

Name: Richard Herder

Title: Managing Director

[Second Amendment to Unsecured Credit Agreement – Signature Page]

ING BANK N.V., LONDON BRANCH

By /s/ M Groen

Name: M Groen

Title: Director

By /s/ M E R Sharman

Name: M E R Sharman

Title: Managing Director

[Second Amendment to Unsecured Credit Agreement – Signature Page]

Lloyds Bank plc

By /s/ Julia R. Franklin

Name: Julia R. Franklin - F014

Title: Vice President

By /s/ Daven Popat

Name: Daven Popat - P003

Title: Senior Vice President

[Second Amendment to Unsecured Credit Agreement – Signature Page]

THE BANK OF NEW YORK MELLON

By /s/ Michael Pensari

Name: Michael Pensari

Title: Managing Director

[Second Amendment to Unsecured Credit Agreement – Signature Page]

The Bank of Tokyo Mitsubishi UFJ, LTD

By /s/ O Cortez

Name: O. Cortez

Title: Vice President

[Second Amendment to Unsecured Credit Agreement – Signature Page]

BNP Paribas

By /s/ Nair P. Raghu

Name: Nair P. Raghu

Title: Vice President

By /s/ Riad Jafarov

Name: Riad Jafarov

Title: Vice President

[Second Amendment to Unsecured Credit Agreement – Signature Page]

COMMERZBANK AG, NEW YORK BRANCH

By /s/ Barry S. Feigenbaum

Name: Barry S. Feigenbaum

Title: Managing Director

By /s/ Christoph Zimmermann

Name: Christoph Zimmermann

Title: Vice President

[Second Amendment to Unsecured Credit Agreement – Signature Page]

MORGAN STANLEY BANK, N.A.

By /s/ Harry Comninellis

Name: Harry Comninellis

Title: Authorized Signatory

[Second Amendment to Unsecured Credit Agreement – Signature Page]

WELLS FARGO BANK, NATIONAL ASSOCIATION

By /s/ Grainne Pergolini

Name: Grainne Pergolini

Title: Managing Director

[Second Amendment to Unsecured Credit Agreement – Signature Page]

EXHIBIT A

SCHEDULE II

Part E

1. Letter of Credit Facility Agreement dated 4 April 2013 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd, Catlin Insurance Company (UK) Limited, Catlin Re Schweiz AG and Catlin Underwriting Agencies Limited (as Original Borrowers) and Barclays Bank Plc, Credit Suisse AG, JPMorgan Chase Bank, N.A., London Branch and Citibank Europe Plc (as Agent) in the sum of U.S.$450,000,000.

2. An unsecured Facilities Agreement dated 22 January 2014 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Underwriting Agencies Limited, Catlin Insurance Company Ltd. and Catlin Re Schweiz AG (as Original Borrowers) and Commonwealth Bank of Australia, London Branch in the sum of U.S.$75,000,000.

3. An unsecured Facilities Agreement (as Amended and Restated) dated 15 January 2014 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Underwriting Agencies Limited, Catlin Insurance Company Ltd. and Catlin Re Schweiz AG (as Original Borrowers) and Wells Fargo Bank, N.A. in the sum of U.S.$75,000,000.

4. An unsecured Facility Agreement dated 18 December 2013 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd. (as Original Borrower) and National Australia Bank Limited in the sum of U.S.$100,000,000.

5. An unsecured Facility Agreement dated 21 November 2013 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd. (as Original Borrower) and ING Bank N.V., London Branch (as the Bank) in the sum of U.S.$100,000,000.

6. An unsecured Facility Agreement dated 21 November 2013 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd. (as Original Borrower) and Standard Chartered Bank in the sum of U.S.$100,000,000.

7. An unsecured Facility Agreement dated 26 November 2013 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd. (as Original Borrower) and The Royal Bank of Scotland Plc in the sum of U.S.$75,000,000.

8. An unsecured Facility Agreement dated 30 June 2014 between Catlin Group Limited and Catlin Insurance Company Ltd. (as Original Guarantors) and Catlin Insurance Company Ltd. and Catlin Underwriting Agencies Limited (as Original Borrowers) and the National Australia Bank Limited in the sum of A$50,000,000.

9. A secured Facility Agreement dated 28 July 2011 between Catlin Re Switzerland Ltd and Citibank, N.A. and Citibank Europe Plc in the sum of U.S.$50,000,000.

10. A secured Facility Agreement dated 9 November 2010 between Catlin Insurance Company Ltd. and Citibank Europe Plc in the sum of U.S.$230,000,000.

11. XLIT Ltd’s $500 million aggregate principal amount of 4.450% subordinated notes due 2025 and $500 million aggregate principal amount of 5.500% subordinated notes due 2045.

Wellington Underwriting PLC’s (A) US$27,000,000 Floating Rate Subordinated Notes due 2036; (B) €7,000,000 Floating Rate Subordinated Notes due 2035; (C) US$31,300,000 Floating Rate Subordinated Notes due 2036; (D) US$9,800,000 Floating Rate Subordinated Notes due 2036 and (E) €11,000,000 Floating Rate Subordinated Notes due 2036.

12. Catlin Finance (UK) Limited’s US$475,000,000 Long-Dated Subordinated Guaranteed Loan Notes subject to and with the benefit of a loan note deed made by way of deed poll by Catlin Finance (UK) Limited, dated June 27, 2007, and an irrevocable guarantee agreement made by way of deed poll by Catlin (North American) Holdings Limited dated June 27, 2007.

Part F

1. Reinsurance Deposit and Securities Portfolio Security Agreement by and between Catlin Re Switzerland Ltd, as Chargor, Citibank, N.A., as Custodian, and Citibank Europe Plc, as Bank, dated July 28, 2011.

2. Reinsurance Deposit and Securities Portfolio Security Agreement by and between Catlin Insurance Company Ltd., as Chargor, Citibank, N.A., as Custodian, and Citibank Europe Plc, as Bank, dated November 9, 2010.

EX-10.5

Exhibit 10.5

August 7, 2015

Mr. Stephen John Oakley Catlin

Windsong

14 Fairway Drive

Warwick, Bermuda

WK-04

Re: Amendment to Letter of Assignment

Dear Stephen:

On behalf of the XL Group plc and XL Services (Bermuda) Ltd (collectively, the “Company”), I am writing pursuant to Section 13 of the Letter of Assignment between you and the Company, which became effective on 1 May 2015 (“Letter of Assignment”), to confirm our mutual agreement to several amendments which will be effective as of the date hereof, to wit:

1. Section 2(a) of the Letter of Assignment is amended to remove “USD $1,000,000” and replace it with “USD $1,300,000” with effect from 1 September 2015.

2. Section 2(b) of the Letter of Assignment is amended to remove the final sentence of that sub-section in its entirety and replace it with the following sentence: “Your target bonus opportunity shall be USD $2,000,000.”

This amendment letter is final and binding on all parties with respect to its subject matter. All other provisions contained in the Letter of Assignment remain in full force and effect as if fully set forth in this letter of amendment.

If you are in agreement with these amendments to the Letter of Assignment, please sign the agreement below and return a copy to me. We will return a fully executed copy to you for your records.

Thank you for your thoughtful attention to this matter.

Very truly yours,

/s/ Eileen Whelley                             

___________________________

Eileen Whelley

Chief Human Resources Officer

XL GROUP plc (for and on behalf of XL Group plc)

/s/ Kim Wilkerson                            

___________________________

(for and on behalf of XL Services Bermuda Ltd)

READ, ACCEPTED & AGREED

This 7th day of August 2015

/s/ Stephen John Oakley Catlin

______________________________

Stephen John Oakley Catlin

EX-12

Exhibit 12

XL GROUP PLC

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERENCE DIVIDENDS

	Six Months Ended June 30,
(U.S. dollars in thousands, except ratios)	2015		2014
Earnings:
Pre-tax income (loss) from continuing operations	$	951,930	$	(80,444	)
Fixed charges	146,936		100,571
Distributed income of equity investees	564,923		112,490
Subtotal	$	1,663,789	$	132,617
Less: Non-controlling interests	3,874		1,129
Preference share dividends	38,395		38,312
Total earnings (loss)	$	1,621,520	$	93,176
Fixed charges:
Interest costs	$	80,519	$	64,444
Accretion of deposit liabilities	20,586		(7,418		)
Rental expense at 30% (1)	7,436		5,233
Total fixed charges	$	108,541	$	62,259
Preference share dividends	38,395		38,312
Total fixed charges and preference dividends	$	146,936	$	100,571
Ratio of earnings to fixed charges	14.9		1.5
Ratio of earnings to combined fixed charges and preference dividends	11.0		0.9
Deficiency - fixed charges only	N/A		N/A
Deficiency - fixed charges and preference dividends	N/A		$	7,395.0

_______________

(1) 30% represents a reasonable approximation of the interest factor.

EX-31

Exhibit 31

Certification of Chief Executive Officer

XL Group plc

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

(Chapter 98, Title 15 U.S.C. 7241)

I, Michael S. McGavick, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of XL Group plc;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated:	August 10, 2015
		/s/ MICHAEL S. MCGAVICK
		Michael S. McGavick
		Chief Executive Officer

Certification of Chief Financial Officer

XL Group plc

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

(Chapter 98, Title 15 U.S.C. 7241)

I, Peter R. Porrino, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of XL Group plc;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated:	August 10, 2015
		/s/ PETER R. PORRINO
		Peter R. Porrino
		Executive Vice President and
		Chief Financial Officer

EX-32

Exhibit 32

Certification Accompanying Form 10-Q of XL Group plc

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(Chapter 63, Title 18 U.S.C. 1350(a) and (b))

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chapter 63, Title 18 U.S.C. 1350(a) and (b)), each of the undersigned hereby certifies that, to his knowledge, the Quarterly Report on Form 10-Q for the period ended June 30, 2015 of XL Group plc (the “Company”) fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated:	August 10, 2015
/s/ MICHAEL S. MCGAVICK
Michael S. McGavick
Chief Executive Officer
XL Group plc
Dated:	August 10, 2015
/s/ PETER R. PORRINO
Peter R. Porrino
Executive Vice President and
Chief Financial Officer
XL Group plc

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to XL Group plc and will be retained by XL Group plc and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Acquisition and Disposals - Financial results (Details) - Catlin Group Limited $ in Thousands	2 Months Ended
	Jun. 30, 2015 USD ($)
Business Combination Results of Operations [Line Items]
Total revenues	$ 709,800
Net income (loss) attributable to ordinary shareholders	$ 50,017

XML

Investments - Analysis of net realized gains (losses) and the change in unrealized (losses) gains on investments (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Net realized gains (losses): [Abstract]
Net realized gains (losses) on investments	$ 49,967	$ 72,697	$ 102,858	$ 91,926
Excluding Life Funds Withheld Assets
Net realized gains (losses): [Abstract]
Gross realized gains	48,547	118,947	110,845	170,160
Gross realized losses on investments sold	(27,608)	(13,487)	(74,728)	(41,744)
OTTI on investments, net of amounts transferred to other comprehensive income	(16,588)	(24,616)	(27,164)	(28,343)
Net realized gains (losses) on investments	4,351	80,844	8,953	100,073
Life Funds Withheld Assets
Net realized gains (losses): [Abstract]
Gross realized gains	84,641	624	137,769	624
Gross realized losses on investments sold	(16,604)	0	(16,994)	0
OTTI on investments, net of amounts transferred to other comprehensive income	(2,878)	(8,771)	(8,087)	(8,771)
Net unrealized gains (losses) on investments, trading securities	(19,543)	0	(18,783)	0
Net realized gains (losses) on investments	$ 45,616	$ (8,147)	$ 93,905	$ (8,147)

XML

Segment Information - Statement of earnings by segment (Details) - USD ($) $ in Thousands		3 Months Ended				6 Months Ended
		Jun. 30, 2015		Jun. 30, 2014		Jun. 30, 2015		Jun. 30, 2014
Segment Reporting Information [Line Items]
Gross premiums written		$ 3,081,135		$ 2,198,239		$ 5,636,495		$ 4,711,175
Net premiums written		2,118,331		1,491,844		3,969,580		3,487,695
Net premiums earned		2,082,053		1,496,594		3,416,053		2,985,433
Net losses and loss expenses	[1]	1,173,276		913,179		1,962,490		1,858,271
Acquisition costs	[1]	341,617		184,619		495,313		384,033
Operating expenses	[2]	363,829		263,721		615,712		510,823
Underwriting profit (loss)		203,331		135,075		342,538		232,306
Net results from structured products		5,257	[3]	34,885	[4]	10,282	[5]	42,838	[6]
Net fee income and other	[7]	(1,364)		(2,858)		(7,872)		(3,352)
Loss on sale of life reinsurance subsidiary		0		666,423		0		666,423
Net realized gains (losses) on investments		49,967		72,697		102,858		91,926
Net realized and unrealized gains (losses) on derivative instruments		48,509		11,599		65,030		13,409
Net income (loss) from investment fund affiliates and operating affiliates	[8]	40,839		45,421		98,836		125,009
Gain on sale of operating affiliate		340,407		0		340,407		0
Exchange (gains) losses		10,374		21,141		37,764		31,582
Corporate operating expenses		130,987		56,495		193,430		107,833
Contribution from P&C and Corporate and Other		991,915		(248,948)		1,131,285		109,009
Interest expense	[9]	39,038		32,284		80,519		64,444
Non-controlling interests		4,879		3,682		42,269		39,441
Income tax		32,959		(5,654)		57,177		28,667
Net income (loss) attributable to ordinary shareholders		915,039		(279,260)		951,320		(23,543)
Corporate and Other
Segment Reporting Information [Line Items]
Gross premiums written	[10]	79,443		86,710		154,394		171,007
Net premiums written	[10]	18,258		58,518		32,764		134,829
Net premiums earned	[10]	18,258		58,518		32,764		134,829
Net losses and loss expenses	[1],[10]	22,081		85,299		41,468		198,886
Acquisition costs	[1],[10]	1,684		3,882		3,501		11,061
Operating expenses	[2],[10]	(59)		2,209		872		5,397
Underwriting profit (loss)	[10]	(5,448)		(32,872)		(13,077)		(80,515)
Net results from structured products	[10]	0	[3]	0	[4]	0	[5]	0	[6]
Net fee income and other	[7],[10]	46		45		178		90
Loss on sale of life reinsurance subsidiary				666,423				666,423	[10]
Net realized and unrealized gains (losses) on derivative instruments	[10]	48,509		11,599		65,030		13,409
Net income (loss) from investment fund affiliates and operating affiliates	[8],[10]	40,839		45,421		98,836		125,009
Gain on sale of operating affiliate		340,407				340,407	[10]
Exchange (gains) losses	[10]	10,374		21,141		37,764		31,582
Corporate operating expenses	[10]	130,987		56,495		193,430		107,833
Contribution from P&C and Corporate and Other	[10]	625,605		(671,937)		481,139		(627,461)
Interest expense	[9],[10]	39,038		32,284		80,519		64,444
Non-controlling interests	[10]	4,879		3,682		42,269		39,441
Income tax	[10]	32,959		(5,654)		57,177		28,667
Excluding Life Funds Withheld Assets
Segment Reporting Information [Line Items]
Net investment income	[11]	160,292		196,673		303,310		411,092
Net realized gains (losses) on investments		4,351		80,844		8,953		100,073
Excluding Life Funds Withheld Assets | Corporate and Other
Segment Reporting Information [Line Items]
Net investment income	[10],[11]	10,831		52,118		21,041		123,010
Net realized gains (losses) on investments	[10]	128		2,339		(1,077)		3,902
Life Funds Withheld Assets
Segment Reporting Information [Line Items]
Net investment income		46,864		19,165		97,283		19,165
Net realized gains (losses) on investments		45,616		(8,147)		93,905		(8,147)
Net realized and unrealized gains (losses) on derivative instruments		239,174		(17,546)		9,807		(17,546)
Life Funds Withheld Assets | Corporate and Other
Segment Reporting Information [Line Items]
Net investment income	[10]	46,864		19,165		97,283		19,165
Net realized gains (losses) on investments	[10]	45,616		(8,147)		93,905		(8,147)
Net realized and unrealized gains (losses) on derivative instruments	[10]	239,174		(17,546)		9,807		(17,546)
Operating Segments [Member] | Total P&C
Segment Reporting Information [Line Items]
Gross premiums written		3,001,692		2,111,529		5,482,101		4,540,168
Net premiums written		2,100,073		1,433,326		3,936,816		3,352,866
Net premiums earned		2,063,795		1,438,076		3,383,289		2,850,604
Net losses and loss expenses	[1]	1,151,195		827,880		1,921,022		1,659,385
Acquisition costs	[1]	339,933		180,737		491,812		372,972
Operating expenses	[2]	363,888		261,512		614,840		505,426
Underwriting profit (loss)		208,779		167,947		355,615		312,821
Net results from structured products		5,257	[3]	34,885	[4]	10,282	[5]	42,838	[6]
Net fee income and other	[7]	(1,410)		(2,903)		(8,050)		(3,442)
Net realized and unrealized gains (losses) on derivative instruments						0
Contribution from P&C and Corporate and Other		$ 366,310		$ 422,989		$ 650,146		$ 736,470
Ratios - P&C operations
Loss and loss expense ratio	[12]	55.80%		57.60%		56.80%		58.20%
Underwriting expense ratio	[12]	34.10%		30.70%		32.70%		30.80%
Combined ratio	[12]	89.90%		88.30%		89.50%		89.00%
Operating Segments [Member] | Insurance Segment
Segment Reporting Information [Line Items]
Gross premiums written		$ 2,219,444		$ 1,618,405		$ 3,874,191		$ 3,189,331
Net premiums written		1,401,772		996,880		2,490,880		2,124,247
Net premiums earned		1,412,906		1,003,990		2,375,212		1,996,430
Net losses and loss expenses	[1]	896,370		627,627		1,513,317		1,266,820
Acquisition costs	[1]	181,716		99,863		262,103		204,863
Operating expenses	[2]	292,161		213,930		500,618		416,983
Underwriting profit (loss)		42,659		62,570		99,174		107,764
Net results from structured products		3,401	[3]	31,645	[4]	6,306	[5]	36,535	[6]
Net fee income and other	[7]	$ (2,033)		$ (3,567)		$ (9,498)		$ (4,779)
Ratios - P&C operations
Loss and loss expense ratio	[12]	63.40%		62.50%		63.70%		63.50%
Underwriting expense ratio	[12]	33.60%		31.30%		32.10%		31.10%
Combined ratio	[12]	97.00%		93.80%		95.80%		94.60%
Operating Segments [Member] | Reinsurance Segment
Segment Reporting Information [Line Items]
Gross premiums written		$ 782,248		$ 493,124		$ 1,607,910		$ 1,350,837
Net premiums written		698,301		436,446		1,445,936		1,228,619
Net premiums earned		650,889		434,086		1,008,077		854,174
Net losses and loss expenses	[1]	254,825		200,253		407,705		392,565
Acquisition costs	[1]	158,217		80,874		229,709		168,109
Operating expenses	[2]	71,727		47,582		114,222		88,443
Underwriting profit (loss)		166,120		105,377		256,441		205,057
Net results from structured products		1,856	[3]	3,240	[4]	3,976	[5]	6,303	[6]
Net fee income and other	[7]	$ 623		$ 664		$ 1,448		$ 1,337
Ratios - P&C operations
Loss and loss expense ratio	[12]	39.20%		46.10%		40.40%		46.00%
Underwriting expense ratio	[12]	35.30%		29.60%		34.20%		30.00%
Combined ratio	[12]	74.50%		75.70%		74.60%		76.00%
Operating Segments [Member] | Excluding Life Funds Withheld Assets | Total P&C
Segment Reporting Information [Line Items]
Net investment income	[11]	$ 149,461		$ 144,555		$ 282,269		$ 288,082
Net realized gains (losses) on investments		$ 4,223		$ 78,505		$ 10,030		$ 96,171

[1] The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

[2] Operating expenses of the segments exclude Corporate operating expenses, shown separately.

[3] The net results from P&C structured products include net investment income and interest expense of $16.0 million and $10.6 million, respectively.

[4] The net results from P&C structured products include net investment income and interest credit of $16.9 million and $18.2 million, respectively.

[5] The net results from P&C structured products include net investment income and interest expense of $31.1 million and $20.6 million, respectively.

[6] The net results from P&C structured products include net investment income and interest credit of $35.7 million and $7.4 million, respectively.

[7] Net fee income and other includes operating expenses from the Company's loss prevention consulting services business.

[8] The Company generally 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.

[9] Interest expense excludes interest expense related to deposit liabilities recorded in the Insurance and Reinsurance segments

[10] Corporate and Other includes other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

[11] Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

[12] Ratios are based on net premiums earned from P&C operations.

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Share Capital - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands		6 Months Ended
	May. 01, 2015	Jun. 30, 2015	Feb. 21, 2014
2014 Repurchase Authorization
Shareholders Equity Disclosure [Line Items]
Stock Repurchase Program, Authorized Amount			$ 1,000,000
Stock Repurchased and Retired During Period, Shares		2,900,000
Stock Repurchased and Retired During Period, Value		$ 110,000
Stock Repurchase Program, Remaining Authorized Repurchase Amount		$ 157,600
Stock options
Shareholders Equity Disclosure [Line Items]
Weighted Average Grant Date Fair Value Per Stock Option		$ 6.51
Number of Stock Options Granted During the Period		2,000,000
Restricted Stock [Member]
Shareholders Equity Disclosure [Line Items]
Number of Awards Granted During the Period		40,570
Aggregate Grant Date Fair Value of Award		$ 1,500
Restricted stock units
Shareholders Equity Disclosure [Line Items]
Number of Awards Granted During the Period		1,500,000
Aggregate Grant Date Fair Value of Award		$ 55,400
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		3 years
Deferred Compensation, Share-based Payments [Member]
Shareholders Equity Disclosure [Line Items]
Number of Awards Granted During the Period		2,500,000
Aggregate Grant Date Fair Value of Award		$ 93,400
Performance Shares [Member]
Shareholders Equity Disclosure [Line Items]
Number of Awards Granted During the Period		800,000
Share Based Compensation Arrangement Performance Units Maximum Share Payout Number		1,600,000
Aggregate Grant Date Fair Value of Award		$ 28,200
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		3 years
Minimum [Member]
Shareholders Equity Disclosure [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		3 years
Minimum [Member] | Performance Shares [Member]
Shareholders Equity Disclosure [Line Items]
Performance Units Final Payout Percentage Of Grant Amount		0.00%
Maximum [Member]
Shareholders Equity Disclosure [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		4 years
Maximum [Member] | Performance Shares [Member]
Shareholders Equity Disclosure [Line Items]
Performance Units Final Payout Percentage Of Grant Amount		200.00%
Catlin Group Limited
Shareholders Equity Disclosure [Line Items]
Share issuance to Catlin shareholders	49,935,000
Share issuance consideration	$ 1,851,601
Preferred Stock, Par or Stated Value Per Share		$ 0.01
Preferred Stock, Liquidation Preference Per Share		$ 1,000
Preferred Stock, Dividend Rate, Percentage or Spread on Basis		7.249%
Preferred Stock, Value, Outstanding		$ 562,300
Preferred Stock, Shares Outstanding		600,000
Three Year Option [Member] | Deferred Compensation, Share-based Payments [Member]
Shareholders Equity Disclosure [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		3 years
Two Year Option [Member] | Deferred Compensation, Share-based Payments [Member]
Shareholders Equity Disclosure [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		2 years
3 month LIBOR | Catlin Group Limited
Shareholders Equity Disclosure [Line Items]
Preferred Stock, Dividend Rate, Percentage or Spread on Basis		2.975%

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Investments - Credit loss impairments on fixed income securities (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Investments, Debt and Equity Securities [Abstract]
Balance, beginning of period	$ 108,458	$ 171,382	$ 131,942	$ 174,805
Credit loss impairment recognized in the current period on securities not previously impaired	0	30	7,560	41
Credit loss impairments previously recognized on securities which matured, paid down, prepaid or were sold during the period	(8,495)	(3,322)	(37,034)	(7,571)
Other than Temporary Impairment, Credit Losses Recognized in Earnings, Reductions, Change in Status	(2,629)	0	(2,629)	0
Additional credit loss impairments recognized in the current period on securities previously impaired	246	892	387	3,153
Accretion of credit loss impairments previously recognized due to an increase in cash flows expected to be collected	(3,361)	(3,105)	(6,007)	(4,551)
Balance, end of period	$ 94,219	$ 165,877	$ 94,219	$ 165,877

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Accumulated Other Comprehensive Income (Loss) - Changes in AOCI, net of tax (Details) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2015		Jun. 30, 2014	Jun. 30, 2015		Jun. 30, 2014	Dec. 31, 2014
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance, net of tax	$ 1,705,170		$ 946,661	$ 1,484,458		$ 736,657
OCI before Reclassifications	(581,964)		359,719	(294,319)		619,039
Amounts reclassified from AOCI	(85,884)		(72,587)	(150,633)		(91,706)
Tax benefit (expense)	38,852		(26,759)	36,668		(56,956)
Comprehensive income (loss)	(628,996)		260,373	(408,284)		470,377
Ending balance, net of tax	1,076,174		1,207,034	1,076,174		1,207,034
AOCI Other Details [Abstract]
Change in adjustments related to future policy benefit reserves, net of tax	(26,328)		440,461	(86,684)		474,465
Unrealized gains (losses) on investments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance, net of tax	1,763,795	[1]	1,032,941	1,590,114	[1]	822,432
OCI before Reclassifications	(544,273)	[1]	363,348	(290,007)	[1]	628,599
Amounts reclassified from AOCI	(87,558)	[1]	(74,337)	(162,338)	[1]	(96,975)
Tax benefit (expense)	37,000	[1]	(20,774)	31,195	[1]	(52,878)
Comprehensive income (loss)	(594,831)	[1]	268,237	(421,150)	[1]	478,746
Ending balance, net of tax	1,168,964	[1]	1,301,178	1,168,964	[1]	1,301,178
AOCI Other Details [Abstract]
Change in adjustments related to future policy benefit reserves, net of tax				(86,700)
Cumulative impact on value of future policy benefit reserve, end of period	358,400			358,400			$ 445,100
OTTI losses recognized in AOCI
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance, net of tax	(66,189)		(85,894)	(76,047)		(89,190)
OCI before Reclassifications	0		0	0		0
Amounts reclassified from AOCI	1,662		1,640	11,598		5,049
Tax benefit (expense)	(87)		(4)	(165)		(117)
Comprehensive income (loss)	1,575		1,636	11,433		4,932
Ending balance, net of tax	(64,614)		(84,258)	(64,614)		(84,258)
Foreign currency translation adjustments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance, net of tax	24,915		10,661	(11,188)		14,541
OCI before Reclassifications	(36,362)		(3,621)	(3,958)		(9,521)
Amounts reclassified from AOCI	0		0	0		0
Tax benefit (expense)	1,939		(5,981)	5,638		(3,961)
Comprehensive income (loss)	(34,423)		(9,602)	1,680		(13,482)
Ending balance, net of tax	(9,508)		1,059	(9,508)		1,059
Underfunded pension liability
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance, net of tax	(19,814)		(13,270)	(20,789)		(13,239)
OCI before Reclassifications	(1,329)		(8)	(354)		(39)
Amounts reclassified from AOCI	0		0	0		0
Tax benefit (expense)	0		0	0		0
Comprehensive income (loss)	(1,329)		(8)	(354)		(39)
Ending balance, net of tax	(21,143)		(13,278)	(21,143)		(13,278)
Cash flow hedge
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance, net of tax	2,463		2,223	2,368		2,113
OCI before Reclassifications	0		0	0		0
Amounts reclassified from AOCI	12		110	107		220
Tax benefit (expense)	0		0	0		0
Comprehensive income (loss)	12		110	107		220
Ending balance, net of tax	$ 2,475		$ 2,333	$ 2,475		$ 2,333

[1] Included in these amounts is the impact of Shadow Adjustments. As of December 31, 2014 the cumulative impact of the Shadow Adjustments was $445.1 million. During the six months ended June 30, 2015, net movements of $(86.7) million were recorded, resulting in a total cumulative net impact of Shadow Adjustments on future policy benefit reserves of $358.4 million as of June 30, 2015.

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Fair Value Measurements - Financial instruments not carried at fair value (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Other investments - structured transactions	$ 348,200	$ 354,400
Deposit liabilities	1,212,206	1,245,367
Notes payable and debt	2,726,455	1,662,580
Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Financial Assets	348,192	354,382
Deposit liabilities	1,212,206	1,245,367
Notes payable and debt	2,726,455	1,662,580
Financial Liabilities	3,938,661	2,907,947
Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Financial Assets	365,335	371,625
Deposit liabilities	1,528,520	1,543,761
Notes payable and debt	2,911,949	1,897,854
Financial Liabilities	$ 4,440,469	$ 3,441,615

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Computation of Earnings Per Ordinary Share and Ordinary Share Equivalent (Tables)

6 Months Ended

Jun. 30, 2015

Earnings Per Share [Abstract]

Calculation of earnings per share

The following table sets forth the computation of basic and diluted earnings per ordinary share for the three and six months ended June 30, 2015 and 2014:

	Three Months Ended June 30,					Six Months Ended June 30,
(U.S. dollars in thousands, except per share amounts)	2015		2014			2015		2014
Basic earnings per ordinary share & ordinary share equivalents outstanding:
Net income (loss) attributable to ordinary shareholders	$	915,039	$	(279,260	)	$	951,320	$	(23,543	)
Weighted average ordinary shares outstanding, in thousands - basic	289,420		270,924			272,665		273,616
Basic earnings per ordinary share & ordinary share equivalents outstanding	$	3.16	$	(1.03	)	$	3.49	$	(0.09	)
Diluted earnings per ordinary share & ordinary share equivalents outstanding:
Weighted average ordinary shares outstanding, in thousands - basic	289,420		270,924			272,665		273,616
Impact of share-based compensation and certain conversion features, in thousands	4,563		—			4,808		—
Weighted average ordinary shares outstanding, in thousands - diluted	293,983		270,924			277,473		273,616
Diluted earnings per ordinary share & ordinary share equivalents outstanding	$	3.11	$	(1.03	)	$	3.43	$	(0.09	)
Dividends per ordinary share	$	0.16	$	0.16		$	0.32	$	0.32

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Accumulated Other Comprehensive Income (Loss) - Details About AOCI Components (Details) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2015		Jun. 30, 2014	Jun. 30, 2015		Jun. 30, 2014
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Total before tax	$ (85,884)		$ (72,587)	$ (150,633)		$ (91,706)
Tax benefit (expense)	(32,959)		5,654	(57,177)		(28,667)
Unrealized gains (losses) on investments
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Total before tax	(87,558)	[1]	(74,337)	(162,338)	[1]	(96,975)
OTTI losses recognized in AOCI
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Total before tax	1,662		1,640	11,598		5,049
Underfunded pension liability
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Total before tax	0		0	0		0
Cash flow hedge
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Total before tax	12		110	107		220
Reclassification out of Accumulated Other Comprehensive Income [Member]
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Total before tax	(85,884)		(72,587)	(150,633)		(91,706)
Tax benefit (expense)	3,682		3,695	3,766		4,035
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	(82,202)		(68,892)	(146,867)		(87,671)
Reclassification out of Accumulated Other Comprehensive Income [Member] | Unrealized gains (losses) on investments
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Net realized gains (losses) on investments sold	(71,027)		(107,470)	(149,578)		(132,384)
OTTI on investments	19,398		33,133	35,122		35,409
Total before tax	(87,558)		(74,337)	(162,338)		(96,975)
Tax benefit (expense)	3,694		3,699	3,781		4,152
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	(83,864)		(70,638)	(158,557)		(92,823)
Reclassification out of Accumulated Other Comprehensive Income [Member] | OTTI losses recognized in AOCI
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Net realized gains (losses) on investments sold	1,594		1,386	11,469		3,344
OTTI on investments	68		254	129		1,705
Total before tax	1,662		1,640	11,598		5,049
Tax benefit (expense)	(12)		(4)	(15)		(117)
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	1,650		1,636	11,583		4,932
Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash flow hedge
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Total before tax	12		110	107		220
Tax benefit (expense)	0		0	0		0
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	12		110	107		220
Life Funds Withheld Assets
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Net realized gains (losses) on investments sold	68,037		624	120,775		624
OTTI on investments	(2,878)		(8,771)	(8,087)		(8,771)
Change in adjustments related to future policy benefit reserves, net of tax	(35,929)			(47,883)
Life Funds Withheld Assets | Unrealized gains (losses) on investments
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Change in adjustments related to future policy benefit reserves, net of tax			0			0
Life Funds Withheld Assets | Reclassification out of Accumulated Other Comprehensive Income [Member] | Unrealized gains (losses) on investments
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Change in adjustments related to future policy benefit reserves, net of tax	$ (35,929)		$ 0	$ (47,882)		$ 0

[1] Included in these amounts is the impact of Shadow Adjustments. As of December 31, 2014 the cumulative impact of the Shadow Adjustments was $445.1 million. During the six months ended June 30, 2015, net movements of $(86.7) million were recorded, resulting in a total cumulative net impact of Shadow Adjustments on future policy benefit reserves of $358.4 million as of June 30, 2015.

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Related Party Transactions - Schedule of related party transactions activity (Details) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2015 USD ($) management_company	Jun. 30, 2014 USD ($)	Jun. 30, 2015 USD ($) management_company	Jun. 30, 2014 USD ($)	Dec. 31, 2014 management_company
Related Party Transaction [Line Items]
Reported net premiums written		$ 2,118,331	$ 1,491,844	$ 3,969,580	$ 3,487,695
Net losses and loss expenses incurred		1,151,195	827,880	1,921,022	1,659,385
Reported acquisition costs	[1]	$ 341,617	184,619	$ 495,313	384,033
Number of investment management companies | management_company		6		6		5
Investment manager affiliates
Related Party Transaction [Line Items]
Reported net premiums written		$ 4,445	18,025	$ 31,521	36,191
Net losses and loss expenses incurred		65	7,692	9,166	14,301
Reported acquisition costs		$ 1,384	$ 6,994	$ 10,395	$ 15,553

[1] The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

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Derivative Instruments - Gross amounts of derivative fair values contained in the consolidated balance sheet (Details) - USD ($) $ in Thousands		Jun. 30, 2015	Dec. 31, 2014
Derivatives, Fair Value [Line Items]
Gross amounts recognized in balance sheet		$ 228,475	$ 136,659
Asset derivative fair value		225,236	135,963
Gross amounts recognized in balance sheet		82,884	31,184
Liability derivative fair value		79,645	30,488
Derivatives designated as hedging instruments
Derivatives, Fair Value [Line Items]
Asset derivative notional amount		1,834,298	2,300,609
Gross amounts recognized in balance sheet	[1]	209,675	121,862
Liability derivative notional amount		720,027	302,211
Gross amounts recognized in balance sheet	[1]	52,188	2,936
Derivatives designated as hedging instruments | Foreign exchange contracts
Derivatives, Fair Value [Line Items]
Asset derivative notional amount		1,834,298	2,300,609
Gross amounts recognized in balance sheet	[1]	209,675	121,862
Liability derivative notional amount		720,027	302,211
Gross amounts recognized in balance sheet	[1]	52,188	2,936
Derivatives not designated as hedging instruments
Derivatives, Fair Value [Line Items]
Asset derivative notional amount		599,833	592,791
Gross amounts recognized in balance sheet	[1]	18,800	14,797
Liability derivative notional amount		5,267,561	5,804,625
Gross amounts recognized in balance sheet	[1]	30,696	28,248
Derivatives not designated as hedging instruments | Investment related derivatives | Interest rate exposure
Derivatives, Fair Value [Line Items]
Asset derivative notional amount		10,684	394,597
Gross amounts recognized in balance sheet	[1]	194	206
Liability derivative notional amount		33,934	20,782
Gross amounts recognized in balance sheet	[1]	44	51
Derivatives not designated as hedging instruments | Investment related derivatives | Foreign exchange contracts
Derivatives, Fair Value [Line Items]
Asset derivative notional amount		301,260	7,385
Gross amounts recognized in balance sheet	[1]	1,628	403
Liability derivative notional amount		139,215	207,182
Gross amounts recognized in balance sheet	[1]	3,786	4,442
Derivatives not designated as hedging instruments | Investment related derivatives | Credit exposure
Derivatives, Fair Value [Line Items]
Asset derivative notional amount		8,963	2,408
Gross amounts recognized in balance sheet	[1]	814	165
Liability derivative notional amount		51,614	14,270
Gross amounts recognized in balance sheet	[1]	12,613	9,836
Derivatives not designated as hedging instruments | Investment related derivatives | Financial market exposure
Derivatives, Fair Value [Line Items]
Asset derivative notional amount		58,875	46,145
Gross amounts recognized in balance sheet	[1]	2,608	360
Liability derivative notional amount		34,794	33,670
Gross amounts recognized in balance sheet	[1]	405	34
Derivatives not designated as hedging instruments | Other non-investment derivatives | Foreign exchange contracts
Derivatives, Fair Value [Line Items]
Asset derivative notional amount		79,101	0
Gross amounts recognized in balance sheet	[1]	164	0
Liability derivative notional amount		8,517	81,194
Gross amounts recognized in balance sheet	[1]	527	282
Derivatives not designated as hedging instruments | Other non-investment derivatives | Other credit derivatives
Derivatives, Fair Value [Line Items]
Asset derivative notional amount		30,281	31,060
Gross amounts recognized in balance sheet		71	60
Liability derivative notional amount		0	0
Gross amounts recognized in balance sheet		0	0
Derivatives not designated as hedging instruments | Other non-investment derivatives | Guaranteed minimum income benefit contract
Derivatives, Fair Value [Line Items]
Asset derivative notional amount		45,006	46,249
Gross amounts recognized in balance sheet	[1]	13,321	13,603
Liability derivative notional amount		45,006	46,249
Gross amounts recognized in balance sheet	[1]	13,321	13,603
Derivatives not designated as hedging instruments | Other non-investment derivatives | Modified coinsurance funds withheld contract
Derivatives, Fair Value [Line Items]
Asset derivative notional amount	[2]	65,663	64,947
Gross amounts recognized in balance sheet	[1],[2]	0	0
Liability derivative notional amount	[2]	4,954,481	5,401,278
Gross amounts recognized in balance sheet	[1],[2]	$ 0	$ 0

[1] Derivative instruments in an asset or liability position are included within Other assets or Other liabilities, respectively, in the balance sheets on a net basis where the Company has both a legal right of offset and the intention to settle the contracts on a net basis.

[2] The fair value movements in derivative assets and liabilities relating to modified coinsurance funds withheld contracts are included within the associated asset or liability at each period end on the face of the balance sheets. Notional amounts associated with reinsurance agreements under which the Company assumes reinsurance risk are recorded as asset derivative notional amounts. Notional amounts associated with the Life Retro Arrangements under which the Company cedes reinsurance risk are recorded as liability derivative notional amounts. Included in the liability derivative notional amount as of June 30, 2015 is the cumulative net realized and unrealized loss on life retrocession embedded derivative of $381.3 million

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Computation of Earnings Per Ordinary Share and Ordinary Share Equivalent - Narrative (Details) - shares shares in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Share-based compensation plans
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (shares)	2.4	16.8	4.5	16.6

XML

Commitments and Contingencies (Details) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2015 USD ($) Guarantee_contracts	Dec. 31, 2014
Guarantor Obligations [Line Items]
Aggregate exposure outstanding	$ 80,800
Total gross claim liability recorded	$ 0
Financial Guarantee Insurance Contracts Outstanding Weighted Average Contract Period	24 years 8 months 12 days	25 years 2 months 12 days
Financial Guarantee Related to Securities Including Some Issued By European Financials [Member]
Guarantor Obligations [Line Items]
Closing number of financial guarantee contracts | Guarantee_contracts	2

XML

Notes Payable and Debt and Financing Arrangements - Notes payable and debt (Details) $ in Thousands, € in Millions			6 Months Ended
		Mar. 30, 2015 USD ($)	Jun. 30, 2015 USD ($)		Jun. 30, 2015 EUR (€)	Dec. 31, 2014 USD ($)
Debt Instrument [Line Items]
Commitment, debt			$ 2,763,142			$ 1,675,000
Notes payable and debt			$ 2,726,455			1,662,580
Percentage ownership of subsidiaries			100.00%
Senior notes | 2.3% Senior Notes due 2018
Debt Instrument [Line Items]
Commitment, debt	[1]		$ 300,000			300,000
Notes payable and debt	[2]		$ 297,679			297,344
Debt interest rate (percent)			2.30%		2.30%
Senior notes | 5.75% Senior Notes due 2021
Debt Instrument [Line Items]
Commitment, debt	[1]		$ 400,000			400,000
Notes payable and debt	[2]		$ 397,307			397,092
Debt interest rate (percent)			5.75%		5.75%
Senior notes | 6.375% Senior Notes due 2024
Debt Instrument [Line Items]
Commitment, debt	[1]		$ 350,000			350,000
Notes payable and debt	[2]		$ 348,975			348,920
Debt interest rate (percent)			6.375%		6.375%
Senior notes | 6.25% Senior Notes due 2027
Debt Instrument [Line Items]
Commitment, debt	[1]		$ 325,000			325,000
Notes payable and debt	[2]		$ 323,140			323,062
Debt interest rate (percent)			6.25%		6.25%
Senior notes | 5.25% Senior Notes due 2043
Debt Instrument [Line Items]
Commitment, debt	[1]		$ 300,000			300,000
Notes payable and debt	[2]		$ 296,228			$ 296,162
Debt interest rate (percent)			5.25%		5.25%
XL Cayman | Subordinated notes | 4.45% Subordinated Notes due 2025
Debt Instrument [Line Items]
Commitment, debt	[1]		$ 500,000
Notes payable and debt	[2]		$ 492,292
Debt interest rate (percent)		4.45%	4.45%		4.45%
Debt issue price, as a percentage of face value		99.633%
Net proceeds on issuance of debt		$ 492,200
Debt issuance cost		$ 5,900
XL Cayman | Subordinated notes | 5.5% Subordinated Notes due 2045
Debt Instrument [Line Items]
Commitment, debt	[1]		$ 500,000
Notes payable and debt	[2]		$ 488,352
Debt interest rate (percent)		5.50%	5.50%		5.50%
Debt issue price, as a percentage of face value		99.115%
Net proceeds on issuance of debt		$ 488,400
Debt issuance cost		$ 7,200
Catlin Underwriting [Member] | Subordinated notes | Variable Rate Note, face amount EUR 7m due 2035
Debt Instrument [Line Items]
Commitment, debt			$ 7,794	[1]	€ 7
Notes payable and debt	[2]		$ 7,301
Spread on variable rate			2.95%
Catlin Underwriting [Member] | Subordinated notes | Variable Rate Note, face amount $27m due 2036
Debt Instrument [Line Items]
Commitment, debt	[1]		$ 27,000
Notes payable and debt	[2]		$ 25,259
Spread on variable rate			3.17%
Catlin Underwriting [Member] | Subordinated notes | Variable Rate Note, face amount $31m due 2036
Debt Instrument [Line Items]
Commitment, debt	[1]		$ 31,300
Notes payable and debt	[2]		$ 29,281
Spread on variable rate			3.10%
Catlin Underwriting [Member] | Subordinated notes | Variable Rate Note, face amount $10m due 2036
Debt Instrument [Line Items]
Commitment, debt	[1]		$ 9,800
Notes payable and debt	[2]		$ 9,168
Spread on variable rate			3.00%
Catlin Underwriting [Member] | Subordinated notes | Variable Rate Note, face amount $11m due 2036
Debt Instrument [Line Items]
Commitment, debt			$ 12,248	[1]	€ 11
Notes payable and debt	[2]		$ 11,473
Spread on variable rate			3.00%

[1] Excluded from the table are revolving credit facilities of $1.7 billion and $1.6 billion as of June 30, 2015 and December 31, 2014, respectively. As of June 30, 2015 and December 31, 2014, $667.9 million and $606.1 million, respectively, were utilized under these facilities to issue letters of credit, leaving $1.0 billion and $968.9 million, respectively, available for use under the revolving credit facilities.

[2] "In Use" and "Outstanding" data represent June 30, 2015 and December 31, 2014 accreted values.

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2015

Fair Value Disclosures [Abstract]

Fair Value Hierarchy

The following tables set forth the Company’s assets and liabilities that were accounted for at fair value as of June 30, 2015 and December 31, 2014 by level within the fair value hierarchy:

June 30, 2015 (U.S. dollars in thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Collateral and Counterparty Netting		Balance at June 30, 2015
Assets
Fixed maturities - Available for Sale ("AFS") - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	3,827,106	$	—	$	—	$	3,827,106
Corporate - Financials	—		3,225,513		10,000		—		3,235,513
Corporate - Non Financials (1)	—		6,946,510		5,554		—		6,952,064
Residential mortgage-backed securities – Agency ("RMBS - Agency")	—		3,955,106		3,038		—		3,958,144
Residential mortgage-backed securities – Non-Agency ("RMBS - Non-Agency")	—		372,271		—		—		372,271
Commercial mortgage-backed securities ("CMBS")	—		936,058		—		—		936,058
Collateralized debt obligations ("CDO")	—		3,854		484,171		—		488,025
Other asset-backed securities (1)	—		2,307,642		42,745		—		2,350,387

U.S. States and political subdivisions of the States	—		2,391,273		—		—			2,391,273
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		5,260,062		—		—			5,260,062
Total fixed maturities - AFS - Excluding Funds Withheld Assets, at fair value	$	—	$	29,225,395	$	545,508	$	—		$	29,770,903
Equity securities, at fair value	659,338		414,132		—		—			1,073,470
Short-term investments, at fair value (1)(2)	—		807,486		—		—			807,486
Total investments AFS - Excluding Funds Withheld Assets	$	659,338	$	30,447,013	$	545,508	$	—		$	31,651,859
Fixed maturities - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	13,678	$	—	$	—		$	13,678
Corporate - Financials	—		722,922		—		—			722,922
Corporate - Non Financials	—		1,665,678		—		—			1,665,678
RMBS – Agency	—		837		—		—			837
RMBS – Non-Agency	—		29,591		—		—			29,591
CMBS	—		145,617		—		—			145,617
Other asset-backed securities	—		187,537		—		—			187,537
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		1,231,228		—		—			1,231,228
Total fixed maturities - AFS - Life Funds Withheld Assets, at fair value	$	—	$	3,997,088	$	—	$	—		$	3,997,088
Total investments - AFS, at fair value	$	659,338	$	34,444,101	$	545,508	$	—		$	35,648,947
Fixed maturities - trading securities ("Trading")
U.S. Government and Government-Related/Supported	$	—	$	3,596	$	—	$	—		$	3,596
Corporate - Financials	—		187,169		—		—			187,169
Corporate - Non Financials	—		332,654		—		—			332,654
CMBS	—		261		—		—			261
Other asset-backed securities	—		14,823		—		—			14,823
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		252,981		—		—			252,981
Total fixed maturities - Trading, at fair value	$	—	$	791,484	$	—	$	—		$	791,484
Cash equivalents (3)	705,092		270,784		—		—			975,876
Cash equivalents - Life Funds Withheld Assets (3)	143		91,367		—		—			91,510
Other investments (4)	—		1,139,393		255,672		—			1,395,065
Other assets (5)	—		215,083		13,392		(3,239		)	225,236
Total assets accounted for at fair value	$	1,364,573	$	36,952,212	$	814,572	$	(3,239	)	$	39,128,118
Liabilities
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable) (6)	$	—	$	381,337	$	—	$	—		$	381,337
Financial instruments sold, but not yet purchased (7)	1,581		1,233		—		—			2,814
Other liabilities (5)	—		59,739		23,145		(3,239		)	79,645
Total liabilities accounted for at fair value	$	1,581	$	442,309	$	23,145	$	(3,239	)	$	463,796

December 31, 2014 (U.S. dollars in thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Collateral and Counterparty Netting			Balance at December 31, 2014
Assets
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	2,171,953	$	—	$	—		$	2,171,953
Corporate - Financials	—		2,761,916		—		—			$	2,761,916
Corporate - Non Financials (1)	—		6,010,563		5,894		—			$	6,016,457
Residential mortgage-backed securities – RMBS - Agency	—		3,726,666		1,910		—			$	3,728,576
Residential mortgage-backed securities – RMBS - Non-Agency	—		427,351		—		—			$	427,351
CMBS	—		1,052,544		—		—			$	1,052,544
CDO	—		4,076		687,958		—			$	692,034
Other asset-backed securities (1)	—		1,060,005		5,288		—			$	1,065,293
U.S. States and political subdivisions of the States	—		2,021,272		—		—			$	2,021,272
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		4,240,073		—		—			$	4,240,073
Total fixed maturities - AFS - Excluding Funds Withheld Assets, at fair value	$	—	$	23,476,419	$	701,050	$	—		$	24,177,469
Equity securities, at fair value	502,284		366,008		—		—			868,292
Short-term investments, at fair value (1)(2)	—		256,727		—		—			256,727
Total investments AFS - Excluding Funds Withheld Assets	$	502,284	$	24,099,154	$	701,050	$	—		$	25,302,488
Fixed maturities - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	18,724	$	—	$	—		$	18,724
Corporate - Financials	—		801,019		—		—			$	801,019
Corporate - Non Financials	—		2,016,961		—		—			$	2,016,961
RMBS – Agency	—		3,782		—		—			$	3,782
RMBS – Non-Agency	—		85,335		—		—			$	85,335
CMBS	—		193,167		—		—			$	193,167
Other asset-backed securities	—		273,541		—		—			$	273,541
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		1,789,036		—		—			$	1,789,036
Total fixed maturities - AFS - Life Funds Withheld Assets, at fair value	$	—	$	5,181,565	$	—	$	—		$	5,181,565
Total investments - AFS, at fair value	$	502,284	$	29,280,719	$	701,050	$	—		$	30,484,053
Fixed maturities - Trading
Corporate - Non Financials	—		1,171		—		—			$	1,171
Total fixed maturities - Trading, at fair value	$	—	$	1,171	$	—	$	—		$	1,171
Cash equivalents (3)	1,103,877		397,955		—		—			$	1,501,832
Cash equivalents - Life Funds Withheld Assets (3)	460		132,738		—		—			$	133,198
Other investments (4)	—		708,974		185,083		—			$	894,057
Other assets (5)	—		122,996		13,663		(696		)	$	135,963
Total assets accounted for at fair value	$	1,606,621	$	30,644,553	$	899,796	$	(696	)	$	33,150,274
Liabilities
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable) (6)	$	—	$	450,831	$	—	$	—		$	450,831
Financial instruments sold, but not yet purchased (7)	4,737		25,669		—		—			$	30,406
Other liabilities (5)	—		7,757		23,427		(696		)	$	30,488
Total liabilities accounted for at fair value	$	4,737	$	484,257	$	23,427	$	(696	)	$	511,725

____________

(1) Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes had a fair value of $75.3 million and $79.9 million and an amortized cost of $64.5 million and $68.4 million as of June 30, 2015 and December 31, 2014, respectively. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate values of these notes.

(2) Short-term investments consist primarily of Corporate securities and U.S. and Non-U.S. Government and Government-Related/Supported securities.

(3) Cash equivalents balances subject to fair value measurement include certificates of deposit and money market funds. Operating cash balances are not subject to recurring fair value measurement guidance.

(4) The Other investments balance excludes certain structured transactions including certain investments in project finance transactions, and a payment obligation and liquidity financing provided to a structured credit vehicle as a part of a third party medium term note facility. These investments, which totaled $348.2 million as of June 30, 2015 and $354.4 million at December 31, 2014, are carried at amortized cost. For further information, see Item 8, Note 8, "Other Investments," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

(5) Other assets and other liabilities include derivative instruments. The derivative balances included in each category are reported on a gross basis by level with a netting adjustment presented separately in the Collateral and Counterparty Netting column. The fair values of the individual derivative contracts are reported gross in their respective levels based on the fair value hierarchy. For further details regarding derivative fair values and associated collateral received or paid see Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements.

(6) Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable) include balances related to the life retrocession embedded derivative, under which all investment results associated with the Life Funds Withheld Assets related to the Life Retro Arrangements described in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," accrue to the benefit of GCLR.

(7) Financial instruments sold, but not yet purchased, represent "short sales" and are included within "Payable for investments purchased" on the balance sheets.

Level 3 Roll Forward

	Level 3 Assets and Liabilities -Three Months Ended June 30, 2015
(U.S. dollars in thousands)	Corporate - Financials		Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—	$	5,861		$	1,820		$	—
Realized gains (losses)	—		(140		)	—			—
Movement in unrealized gains (losses)	—		(44		)	(1		)	—
Purchases and issuances (1)	10,000		(123		)	1,297			—
Sales	—		—			—			—
Settlements	—		—			(78		)	—
Transfers into Level 3						—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	10,000	$	5,554		$	3,038		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	(184	)	$	(1	)	$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2015
(U.S. dollars in thousands)	CMBS		CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	—	$	496,923		$	2,244		$	—
Realized gains (losses)	—		224			92			—
Movement in unrealized gains (losses)	—		2,445			8			—
Purchases and issuances (1)	—		11,941			40,628			—
Sales	—		—						—
Settlements	—		(27,362		)	(227		)	—
Transfers into Level 3	—		—			—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	—	$	484,171		$	42,745		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	2,057		$	100		$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2015
(U.S. dollars in thousands)			Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period			$	—		$	190,097		$	(9,606	)
Realized gains (losses)			—			1,291			—
Movement in unrealized gains (losses)			—			(139		)	(147		)
Purchases and issuances (1)			—			66,510			—
Sales			—
Settlements			—			(2,087		)	—
Transfers into Level 3			—			—			—
Transfers out of Level 3			—			—			—
Fixed maturities to short-term investments classification change			—			—			—
Balance, end of period			$	—		$	255,672		$	(9,753	)
Movement in total gains (losses) above relating to instruments still held at the reporting date			$	—		$	1,152		$	(147	)

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

	Level 3 Assets and Liabilities -Three Months Ended June 30, 2014
(U.S. dollars in thousands)	Corporate - Financials			Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—		$	4,382		$	8,928		$	11
Realized gains (losses)	—			35			6			—
Movement in unrealized gains (losses)	—			(93		)	(13		)	—
Purchases and issuances (1)	—			8			—			—
Sales	—			—			—			—
Settlements	—			(399		)	(2,025		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			—			—			—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	—		$	3,933		$	6,896		$	11
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	(58	)	$	(6	)	$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2014
(U.S. dollars in thousands)	CMBS			CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	5,926		$	718,827		$	10,673		$	—
Realized gains (losses)	2			875			(5		)	—
Movement in unrealized gains (losses)	(1		)	8,331			144			—
Purchases and issuances (1)	1,376			75,201			3,000			—
Sales	—			(30,892		)	—			—
Settlements	(5,358		)	(39,518		)	(2,108		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			—			—			—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	1,945		$	732,824		$	11,704		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	8,247		$	140		$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2014
(U.S. dollars in thousands)				Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period				$	—		$	116,418		$	(32,496	)
Realized gains (losses)				—			5,127			—
Movement in unrealized gains (losses)				—			(1,779		)	13,586
Purchases and issuances (1)				—			9,997			—
Sales				—			—			—
Settlements				—			(5,288		)	—
Transfers into Level 3				—			—			—
Transfers out of Level 3				—			—			—
Fixed maturities to short-term investments classification change				—			—			—
Balance, end of period				$	—		$	124,475		$	(18,910	)
Movement in total gains (losses) above relating to instruments still held at the reporting date				$	—		$	3,348		$	13,586

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

	Level 3 Assets and Liabilities - Six Months Ended June 30, 2015
(U.S. dollars in thousands)	Corporate - Financials		Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—	$	5,894		$	1,910		$	—
Realized gains (losses)	—		(141		)	—			—
Movement in unrealized gains (losses)	—		4			(2		)	—
Purchases and issuances (1)	10,000		(123		)	1,297			—
Sales	—		—			—			—
Settlements	—		(80		)	(167		)	—
Transfers into Level 3	—		—			—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	10,000	$	5,554		$	3,038		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	(136	)	$	—		$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2015
(U.S. dollars in thousands)	CMBS		CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	—	$	687,958		$	5,288		$	—
Realized gains (losses)	—		260			91			—
Movement in unrealized gains (losses)	—		8,000			10			—
Purchases and issuances (1)	—		11,941			40,628			—
Sales	—		(155,085		)	—			—
Settlements	—		(68,903		)	(3,272		)	—
Transfers into Level 3	—		—			—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	—	$	484,171		$	42,745		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	4,725		$	100		$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2015
(U.S. dollars in thousands)			Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period			$	—		$	185,083		$	(9,764	)
Realized gains (losses)			—			2,593			—
Movement in unrealized gains (losses)			—			(1,966		)	11
Purchases and issuances (1)			—			73,303			—
Sales			—			—			—
Settlements			—			(3,341		)	—
Transfers into Level 3			—			—			—
Transfers out of Level 3			—			—			—
Fixed maturities to short-term investments classification change			—			—			—
Balance, end of period			$	—		$	255,672		$	(9,753	)
Movement in total gains (losses) above relating to instruments still held at the reporting date			$	—		$	628		$	11

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

	Level 3 Assets and Liabilities - Six Months Ended June 30, 2014
(U.S. dollars in thousands)	Corporate - Financials			Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—		$	31,573		$	10,473		$	9
Realized gains (losses)	—			155			6			—
Movement in unrealized gains (losses)	—			(96		)	(13		)	2
Purchases and issuances (1)	—			1,443			—			—
Sales	—			—			—			—
Settlements	—			(5,513		)	(2,598		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			(23,629		)	(972		)	—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	—		$	3,933		$	6,896		$	11
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	90		$	(6	)	$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2014
(U.S. dollars in thousands)	CMBS			CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	12,533		$	710,253		$	11,877		$	—
Realized gains (losses)	3			2,456			(20		)	—
Movement in unrealized gains (losses)	(3		)	12,013			206			—
Purchases and issuances (1)	1,376			103,015			3,000			—
Sales	—			(40,824		)	—			—
Settlements	(11,964		)	(54,089		)	(3,359		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			—			—			—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	1,945		$	732,824		$	11,704		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	13,216		$	186		$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2014
(U.S. dollars in thousands)				Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period				$	2,015		$	113,472		$	(29,110	)
Realized gains (losses)				—			8,691			—
Movement in unrealized gains (losses)				(15		)	(282		)	10,200
Purchases and issuances (1)				—			21,086			—
Sales				—			—			—
Settlements				(2,000		)	(18,492		)	—
Transfers into Level 3				—			—			—
Transfers out of Level 3				—			—			—
Fixed maturities to short-term investments classification change				—			—			—
Balance, end of period				$	—		$	124,475		$	(18,910	)
Movement in total gains (losses) above relating to instruments still held at the reporting date				$	—		$	8,409		$	10,200

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

Financial Instruments Not Carried at Fair Value

	June 30, 2015				December 31, 2014
(U.S. dollars in thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial Assets - Other investments, structured transactions	$	348,192	$	365,335	$	354,382	$	371,625
Deposit liabilities	$	1,212,206	$	1,528,520	$	1,245,367	$	1,543,761
Notes payable and debt	2,726,455		2,911,949		1,662,580		1,897,854
Financial Liabilities	$	3,938,661	$	4,440,469	$	2,907,947	$	3,441,615

XML

Segment Information - Narrative (Details) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2015 USD ($)		Jun. 30, 2014 USD ($)		Jun. 30, 2015 USD ($) segments		Jun. 30, 2014 USD ($)
Segment Reporting Information [Line Items]
Number of segments | segments					2
Net results from structured products	$ (5,257)	[1]	$ (34,885)	[2]	$ (10,282)	[3]	$ (42,838)	[4]
Net investment income | Total P&C
Segment Reporting Information [Line Items]
Net results from structured products	(16,000)		(16,900)		(31,100)		(35,700)
Interest expense | Total P&C
Segment Reporting Information [Line Items]
Net results from structured products	$ 10,600		$ (18,200)		$ 20,600		$ (7,400)
Alternative funds
Segment Reporting Information [Line Items]
Alternative investments, timelag for reporting					1 month
Operating affiliates
Segment Reporting Information [Line Items]
Alternative investments, timelag for reporting					3 months

[1] The net results from P&C structured products include net investment income and interest expense of $16.0 million and $10.6 million, respectively.

[2] The net results from P&C structured products include net investment income and interest credit of $16.9 million and $18.2 million, respectively.

[3] The net results from P&C structured products include net investment income and interest expense of $31.1 million and $20.6 million, respectively.

[4] The net results from P&C structured products include net investment income and interest credit of $35.7 million and $7.4 million, respectively.

XML

Acquisition and Disposals - Impact of Life Retro arrangements (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Underwriting profit (loss)		$ 203,331	$ 135,075	$ 342,538	$ 232,306
Net investment income		223,204	232,773	431,717	465,962
Exchange (gains) losses		(10,374)	(21,141)	(37,764)	(31,582)
Other income and expenses	[1]	(1,364)	(2,858)	(7,872)	(3,352)
Net realized and unrealized gains (losses) on life retrocession embedded derivative		48,509	11,599	65,030	13,409
Net income (loss)		919,918	(275,578)	993,589	15,898
Change in adjustments related to future policy benefit reserves, net of tax		26,328	(440,461)	86,684	(474,465)
Change in cumulative translation adjustment		(34,423)	(9,602)	1,680	(13,482)
Comprehensive income (loss)		(628,996)	260,373	(408,284)	470,377
XL Re Life (SAC) Ltd
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Comprehensive income (loss)		0
Life Funds Withheld Assets
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net investment income		46,864	19,165	97,283	19,165
Net realized gains (losses) on investments sold		68,037	624	120,775	624
Net unrealized gains (losses) on investments, trading securities		(19,543)	0	(18,783)	0
OTTI on investments		(2,878)	(8,771)	(8,087)	(8,771)
Net realized and unrealized gains (losses) on life retrocession embedded derivative		239,174	(17,546)	9,807	(17,546)
Change in net unrealized gains (losses) on investments, net of tax		(321,046)	12,297	(283,931)	12,297
Life Funds Withheld Assets | XL Re Life (SAC) Ltd
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Underwriting profit (loss)	[2]	0	0	603	0
Net investment income		46,864	19,165	97,283	19,165
Net realized gains (losses) on investments sold		68,037	624	120,775	624
Net unrealized gains (losses) on investments, trading securities		(19,543)	0	(18,783)	0
OTTI on investments		(2,878)	(8,771)	(8,087)	(8,771)
Exchange (gains) losses		(18,370)	0	(14,686)	0
Other income and expenses		3,773	(19)	2,475	(19)
Net realized and unrealized gains (losses) on life retrocession embedded derivative		239,174	(17,546)	9,807	(17,546)
Net income (loss)		317,057	(6,547)	189,387	(6,547)
Change in net unrealized gains (losses) on investments, net of tax		(321,046)	12,297	(283,931)	12,297
Change in adjustments related to future policy benefit reserves, net of tax		26,328	0	86,684	0
Change in cumulative translation adjustment		(22,339)	(5,750)	8,463	(5,750)
Total changes to other comprehensive income as a result of Life Retro Arrangements		(317,057)	6,547	(188,784)	6,547
Comprehensive income (loss)		$ 0	$ 0	$ 603	$ 0

[1] Net fee income and other includes operating expenses from the Company's loss prevention consulting services business.

[2] The underwriting profit of $0.6 million relates to a premium adjustment during the six months ended June 30, 2015 relating to the Life Retro Arrangements transaction. Excluding this transaction, the impact to comprehensive income relating to the Life Retro Arrangements was nil for the three and six months ended June 30, 2015.

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Computation of Earnings Per Ordinary Share and Ordinary Share Equivalent - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Basic earnings per ordinary share & ordinary share equivalents outstanding:
Net income (loss) attributable to ordinary shareholders	$ 915,039	$ (279,260)	$ 951,320	$ (23,543)
Weighted average ordinary shares outstanding - basic	289,420	270,924	272,665	273,616
Basic earnings per ordinary share & ordinary share equivalents outstanding	$ 3.16	$ (1.03)	$ 3.49	$ (0.09)
Diluted earnings per ordinary share & ordinary share equivalents outstanding:
Impact of share-based compensation and certain conversion features	4,563	0	4,808	0
Weighted average ordinary shares outstanding - diluted	293,983	270,924	277,473	273,616
Diluted earnings per ordinary share & ordinary share equivalents outstanding	$ 3.11	$ (1.03)	$ 3.43	$ (0.09)
Dividends per ordinary share	$ 0.16	$ 0.16	$ 0.32	$ 0.32

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Acquisition and Disposals - Fair value of assets and liabilities acquired (Details) - USD ($) $ in Thousands			6 Months Ended
		May. 01, 2015	Jun. 30, 2015
LIABILITIES
Goodwill			$ 778,043
Catlin Group Limited
ASSETS
Fixed maturities, at fair value		$ 6,266,489
Short-term investments, at fair value		634,599
Equity investments, at fair value		236,230
Investment in affiliates		216,843
Other investments		386,828
Total investments		7,740,989
Cash and cash equivalents (1)	[1]	1,267,565
Unpaid losses and loss expenses recoverable		1,493,267
Reinsurance balances receivable		299,579
Ceded unearned premiums		1,143,852
Deferred acquisition costs and value of business acquired		679,259
Intangible assets		988,000
Other assets		314,168
Total assets		16,516,563
LIABILITIES
Unpaid losses and loss expenses		6,933,144
Unearned premiums		3,742,234
Reinsurance balances payable		1,441,749
Notes payable and debt		82,066
Payable for investments purchased		34,149
Deferred tax liability		94,071
Other liabilities		265,728
Total liabilities		12,593,141
Net assets acquired before non-controlling interest		3,923,422
Non-controlling interest in equity of consolidated subsidiaries		562,285
Net assets acquired		3,361,137
Acquisition consideration		4,139,180
Goodwill		778,043
Catlin Group Limited | Accrued investment income
ASSETS
Receivables acquired		35,063
Catlin Group Limited | Premiums receivable
ASSETS
Receivables acquired		2,545,188
Catlin Group Limited | Receivable from investments sold
ASSETS
Receivables acquired		$ 9,633

[1] Includes Restricted Cash

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Investments - Contractual maturities of available for sale securities (Details) - Equity Securities, Industry [Domain] - USD ($) $ in Thousands	Jun. 30, 2015		Dec. 31, 2014
Fixed Maturities - AFS
Amortized cost of fixed maturities	$ 32,699,709		$ 27,728,771
Fixed maturities, at fair value	33,767,991		29,359,034
Trading Securities, Debt, Amortized Cost	768,492		1,180
Trading Securities Debt Maturities And Short Term Investments	748,931		1,171
Excluding Life Funds Withheld Assets
Fixed Maturities - AFS
Due less than one year, amortized cost	1,957,896		1,972,224
Due less than one year, fair value	1,962,391		1,980,429
Due after 1 through 5 years, amortized cost	12,409,937		8,919,037
Due after 1 through 5 years, fair value	12,584,530		9,113,651
Due after 5 through 10 years, amortized cost	5,231,268		4,232,396
Due after 5 through 10 years, fair value	5,305,166		4,412,569
Due after 10 years, amortized cost	1,697,800		1,494,315
Due after 10 years, fair value	1,813,931		1,705,022
Subtotal - amortized cost	21,296,901		16,617,972
Subtotal - fair value	21,666,018		17,211,671
Mortgage and asset backed securities - amortized cost	8,013,890		6,809,460
Mortgage and asset backed securities - fair value	8,104,885		6,965,798
Amortized cost of fixed maturities	29,310,791		23,427,432
Fixed maturities, at fair value	29,770,903		24,177,469
Excluding Life Funds Withheld Assets | RMBS - Agency
Fixed Maturities - AFS
Mortgage and asset backed securities - amortized cost	3,890,265		3,625,171
Mortgage and asset backed securities - fair value	3,958,144		3,728,576
Amortized cost of fixed maturities	3,890,265		3,625,171
Fixed maturities, at fair value	3,958,144		3,728,576
Excluding Life Funds Withheld Assets | RMBS - Non-Agency
Fixed Maturities - AFS
Mortgage and asset backed securities - amortized cost	361,661		404,398
Mortgage and asset backed securities - fair value	372,271		427,351
Amortized cost of fixed maturities	361,661		404,398
Fixed maturities, at fair value	372,271		427,351
Excluding Life Funds Withheld Assets | Commercial mortgage-backed securities
Fixed Maturities - AFS
Mortgage and asset backed securities - amortized cost	929,466		1,033,819
Mortgage and asset backed securities - fair value	936,058		1,052,544
Amortized cost of fixed maturities	929,466		1,033,819
Fixed maturities, at fair value	936,058		1,052,544
Excluding Life Funds Withheld Assets | Collateralized debt obligations
Fixed Maturities - AFS
Mortgage and asset backed securities - amortized cost	505,865		717,544
Mortgage and asset backed securities - fair value	488,025		692,034
Amortized cost of fixed maturities	505,865		717,544
Fixed maturities, at fair value	488,025		692,034
Excluding Life Funds Withheld Assets | Other asset-backed securities
Fixed Maturities - AFS
Mortgage and asset backed securities - amortized cost	2,326,633		1,028,528
Mortgage and asset backed securities - fair value	2,350,387		1,065,293
Amortized cost of fixed maturities	2,326,633	[1]	1,028,528	[2]
Fixed maturities, at fair value	2,350,387	[1]	1,065,293	[2]
Life Funds Withheld Assets
Fixed Maturities - AFS
Due less than one year, amortized cost	87,963		117,048
Due less than one year, fair value	96,402		125,326
Due after 1 through 5 years, amortized cost	468,476		638,526
Due after 1 through 5 years, fair value	505,063		685,787
Due after 5 through 10 years, amortized cost	705,507		1,004,698
Due after 5 through 10 years, fair value	808,909		1,165,348
Due after 10 years, amortized cost	1,808,603		2,059,637
Due after 10 years, fair value	2,223,132		2,649,279
Subtotal - amortized cost	3,070,549		3,819,909
Subtotal - fair value	3,633,506		4,625,740
Mortgage and asset backed securities - amortized cost	318,369		481,430
Mortgage and asset backed securities - fair value	363,582		555,825
Amortized cost of fixed maturities	3,388,918		4,301,339
Fixed maturities, at fair value	3,997,088		5,181,565
Trading Securities, Debt, Amortized Cost	811,049		1,180
Trading Securities Debt Maturities And Short Term Investments	791,484		1,171
Life Funds Withheld Assets | RMBS - Agency
Fixed Maturities - AFS
Mortgage and asset backed securities - amortized cost	674		3,301
Mortgage and asset backed securities - fair value	837		3,782
Amortized cost of fixed maturities	674		3,301
Fixed maturities, at fair value	837		3,782
Life Funds Withheld Assets | RMBS - Non-Agency
Fixed Maturities - AFS
Mortgage and asset backed securities - amortized cost	26,377		71,075
Mortgage and asset backed securities - fair value	29,591		85,335
Amortized cost of fixed maturities	26,377		71,075
Fixed maturities, at fair value	29,591		85,335
Life Funds Withheld Assets | Commercial mortgage-backed securities
Fixed Maturities - AFS
Mortgage and asset backed securities - amortized cost	126,539		168,886
Mortgage and asset backed securities - fair value	145,617		193,167
Amortized cost of fixed maturities	126,539		168,886
Fixed maturities, at fair value	145,617		193,167
Trading Securities, Debt, Amortized Cost	262
Trading Securities Debt Maturities And Short Term Investments	261
Life Funds Withheld Assets | Other asset-backed securities
Fixed Maturities - AFS
Mortgage and asset backed securities - amortized cost	164,779		238,168
Mortgage and asset backed securities - fair value	187,537		273,541
Amortized cost of fixed maturities	164,779		238,168
Fixed maturities, at fair value	187,537		273,541
Trading Securities, Debt, Amortized Cost	15,016
Trading Securities Debt Maturities And Short Term Investments	14,823
Life Funds Withheld Assets | Cost
Fixed Maturities - AFS
Due less than one year	42,557		0
Due after 1 through 5 years	221,522		0
Due after 5 through 10 years	162,877		1,180
Due after 10 years	368,815		0
Subtotal	795,771		1,180
Mortgage and asset-backed securities	15,278		0
Trading Securities, Debt, Amortized Cost	811,049		1,180
Life Funds Withheld Assets | Cost | Commercial mortgage-backed securities
Fixed Maturities - AFS
Mortgage and asset-backed securities	262		0
Life Funds Withheld Assets | Cost | Other asset-backed securities
Fixed Maturities - AFS
Mortgage and asset-backed securities	15,016		0
Life Funds Withheld Assets | Fair value
Fixed Maturities - AFS
Due less than one year	42,553		0
Due after 1 through 5 years	220,727		0
Due after 5 through 10 years	160,923		1,171
Due after 10 years	352,197		0
Subtotal	776,400		1,171
Mortgage and asset-backed securities	15,084		0
Trading Securities Debt Maturities And Short Term Investments	791,484		1,171
Life Funds Withheld Assets | Fair value | Commercial mortgage-backed securities
Fixed Maturities - AFS
Mortgage and asset-backed securities	261		0
Life Funds Withheld Assets | Fair value | Other asset-backed securities
Fixed Maturities - AFS
Mortgage and asset-backed securities	$ 14,823		$ 0

[1] Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $75.3 million and an amortized cost of $64.5 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

[2] Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $79.9 million and an amortized cost of $68.4 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

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Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands		6 Months Ended
	May. 01, 2015	Jun. 30, 2015
Schedule Of Acquired Intangible Assets By Major Class [Line Items]
Identified indefinite life intangible assets		$ 673,000
Identified definite life intangible assets		$ 315,000
Catlin Group Limited
Schedule Of Acquired Intangible Assets By Major Class [Line Items]
Identified indefinite life intangible assets	$ 673,000
Identified definite life intangible assets	315,000
Total identified intangible assets	988,000
Catlin Group Limited | Syndicate capacity
Schedule Of Acquired Intangible Assets By Major Class [Line Items]
Identified indefinite life intangible assets	660,000
Catlin Group Limited | Insurance licenses
Schedule Of Acquired Intangible Assets By Major Class [Line Items]
Identified indefinite life intangible assets	13,000
Catlin Group Limited | Lloyds - Managing agent contracts
Schedule Of Acquired Intangible Assets By Major Class [Line Items]
Identified definite life intangible assets	15,000
Estimated useful life		15 years
Catlin Group Limited | Distribution network
Schedule Of Acquired Intangible Assets By Major Class [Line Items]
Identified definite life intangible assets	290,000
Estimated useful life		20 years
Catlin Group Limited | Trademarks / Trade names
Schedule Of Acquired Intangible Assets By Major Class [Line Items]
Identified definite life intangible assets	$ 10,000
Estimated useful life		2 years

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Derivative Instruments - Derivative Instruments Designated as Hedges of the net Investment In a Foreign Operation - Summary (Details) - Derivatives designated as hedging instruments - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Derivative [Line Items]
Weighted average of U.S. dollar equivalent of foreign denominated net assets		$ 1,815,593	$ 2,270,090	$ 1,222,267	$ 2,478,772
Derivative gains (losses)	[1]	$ (30,498)	$ (2,170)	$ 36,272	$ (1,210)

[1] Derivative gains (losses) from derivative instruments designated as hedges of the net investment in a foreign operation are recorded in the cumulative translation adjustment account within AOCI for each period.

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Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed maturities, at fair value	$ 33,767,991	$ 29,359,034
Amortized cost of fixed maturities	32,699,709	27,728,771
Other investments - structured transactions	$ 348,200	$ 354,400
Spread on U.S. treasury for discounting deposit liabilities	0.486%	0.295%
Medium term notes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed maturities, at fair value	$ 75,300	$ 79,900
Amortized cost of fixed maturities	$ 64,500	$ 68,400

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Significant Accounting Policies

6 Months Ended

Jun. 30, 2015

Accounting Policies [Abstract]

Significant Accounting Policies

Significant Accounting Policies

(a) Restricted Cash

Restricted cash represents cash and cash equivalents that the Company is a) holding for the benefit of a third party and which is legally or contractually restricted as to withdrawal or usage for general corporate purposes; and b) not replaceable by another type of asset other than cash or cash equivalents, under the terms of the Company's contractual arrangements with such third parties. Restricted cash includes cash and cash equivalents held pursuant to the terms of the Company's contractual obligations of the transaction described in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary."

(b) Recent Accounting Pronouncements

In February 2015, the Financial Accounting Standards Board ("FASB") issued an accounting standards update concerning consolidation of certain legal entities. Under this new guidance, all legal entities are required to evaluate whether they should consolidate certain legal entities. The guidance: (1) modifies the evaluation of whether limited partnerships and similar legal entities are variable interest entities ("VIEs") or voting interest entities; (2) eliminates the presumption that a general partner should consolidate a limited partnership; (3) affects the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships; and (4) provides a scope exception from consolidation guidance for certain reporting entities. Upon adoption of the new guidance, differing requirements for performing a consolidation analysis under existing GAAP will be eliminated, and all reporting entities will now fall within the scope of the Accounting Standards Codification Subtopic 810-10, Consolidation-Overall, unless a specific exception applies. Under this Subtopic, there are only two primary models for determining whether consolidation is appropriate - a voting interest entity model, and a variable interest entity model. The guidance is effective for public business entities for annual periods beginning after December 15, 2015, and interim and annual periods thereafter, with early adoption permitted. The Company is currently evaluating the impact of this guidance.

In April 2015, the FASB issued an accounting standards update concerning the presentation of deferred debt issuance costs in an entity's balance sheet. Under this new guidance, which is part of the FASB's initiative to reduce complexity in accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements, it is required that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. In addition, the guidance also requires that the amortization of such costs be reported as interest expense. The guidance is effective for public business entities for annual periods beginning after December 15, 2015, and interim and annual periods thereafter, with early adoption permitted for financial statements that have not been previously issued. This guidance is not expected to have a material impact on the Company's financial condition, results of operations or cash flows.

In May 2015, the FASB issued an accounting standards update concerning investments for which management estimates fair value using net asset value per share (or its equivalent) as a practical expedient. Under the guidance, such investments will no longer be reported within the fair value hierarchy. Removing those investments from the fair value hierarchy not only eliminates the diversity in practice resulting from the way in which investments measured at net asset value per share (or its equivalent) with future redemption dates are classified, but also ensures that all investments categorized in the fair value hierarchy are classified using a consistent approach. Investments that calculate net asset value per share (or its equivalent), but for which the practical expedient is not applied, will continue to be included in the fair value hierarchy. A reporting entity should continue to disclose information on investments for which fair value is measured at net asset value (or its equivalent) as a practical expedient to help users understand the nature and risks of the investments and whether the investments, if sold, are probable of being sold at amounts different from net asset value. The guidance is effective for public business entities for annual periods beginning after December 15, 2015 and interim and annual periods thereafter, with early adoption permitted. The Company is currently evaluating the impact of this guidance, but it is not expected to have a material impact on the Company's financial condition, results of operations or cash flows.

In May 2015, the FASB issued an accounting standards update concerning the annual disclosure regarding the liability for unpaid claims and claims adjustment expenses for insurance entities. The guidance requires: (1) incurred and paid claims development information by accident year, on a net basis after reinsurance, for the number of years for which claims incurred typically remain outstanding, including the most recent reporting period, which need not exceed 10 years; (2) a reconciliation of incurred and paid claims development information to the aggregate carrying amount of the liability for unpaid claims and claim adjustment expenses, with separate disclosure of reinsurance recoverable on unpaid claims for each period presented in the statement of financial position; (3) for each accident year for which incurred claims development information is presented, the total of incurred but not reported ("IBNR") liabilities plus expected development on reported claims included in the liability for unpaid claims and claims adjustment expenses, accompanied by a description of reserving methodologies; (4) for each accident year for which incurred claims development information is presented, quantitative information about claim frequency (unless it is impracticable to do so) accompanied by a qualitative description of methodologies used for determining claim frequency information; and (5) for all claims, the average annual percentage payout of incurred claims by age for the same number of accident years as the disclosure for IBNR. The guidance recommends that insurance entities aggregate or disaggregate those disclosures so that useful information is not obscured by either the inclusion of a large amount of insignificant detail or the aggregation of items that have significantly different characteristics. The amendments also require insurance entities to disclose information about significant changes in methodologies and assumptions used to calculate the liability for unpaid claims and claim adjustment expenses, including reasons for the change and the effects on the financial statements. Additionally, the amendments require insurance entities to disclose for annual and interim reporting periods a rollforward of the liability for unpaid claims and claims adjustment expenses. Additional disclosures about liabilities for unpaid claims and claim adjustment expenses reported at present value include: (1) for each period presented in the statement of financial position, the aggregate amount of discount for the time value of money deducted to derive the liability for unpaid claims and claim adjustment expenses; (2) for each period presented in the statement of income, the amount of interest accretion recognized; and (3) the line items in the statement of income in which interest accretion is classified. The guidance is effective for public business entities for annual periods beginning after December 15, 2015 and interim periods within annual periods after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact of this guidance, but it is not expected to have a material impact on the Company's financial condition, results of operations or cash flows

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Derivative Instruments - Net Realized and unrealized gains (losses) on Derivative Instruments (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Derivative [Line Items]
Amount of gain (loss) recognized in income from ineffective portion of fair value hedges	$ 0	$ (2,050)	$ 0	$ (256)
Net realized and unrealized gains (losses) on derivative instruments	48,509	11,599	65,030	13,409
Derivatives not designated as hedging instruments
Derivative [Line Items]
Total gain (loss) recognized in income from derivatives not designated as hedging instruments	48,509	13,649	65,030	13,665
Derivatives not designated as hedging instruments | Investment related derivatives
Derivative [Line Items]
Interest rate exposure	(6,563)	8,978	3,073	9,326
Foreign exchange exposure	482	(1,490)	(880)	1,798
Credit exposure	(386)	411	(305)	7
Financial market exposure	(1,645)	2,508	1,398	3,378
Derivatives not designated as hedging instruments | Financial operations derivatives
Derivative [Line Items]
Credit exposure	0	447	0	(4,353)
Derivatives not designated as hedging instruments | Other non-investment derivatives
Derivative [Line Items]
Foreign exchange exposure	55,372	0	57,431	0
Credit exposure	132	0	1,478	0
Guaranteed minimum income benefit contract	0	633	0	2,257
Modified coinsurance funds withheld contract	1,117	2,162	2,835	1,252
Life Funds Withheld Assets
Derivative [Line Items]
Net realized and unrealized gains (losses) on derivative instruments	$ 239,174	$ (17,546)	$ 9,807	$ (17,546)

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Acquisition and Disposals - Sale of Life Reinsurance narrative (Details) - USD ($) $ in Thousands				3 Months Ended		6 Months Ended
		May. 30, 2014	May. 01, 2014	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Future policy benefit reserves				$ 4,494,886		$ 4,494,886		$ 4,707,199
Future policy benefit reserves recoverable				4,054,705		4,054,705		4,265,678
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable)				915,116		915,116		$ 1,155,016
Underwriting profit (loss)				203,331	$ 135,075	342,538	$ 232,306
Comprehensive income (loss)				(628,996)	260,373	(408,284)	470,377
XL Re Life (SAC) Ltd
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Sale of subsidiary stock, percentage		100.00%
Consideration received		$ 570,000
Quota share reinsurance percentage		100.00%
Future policy benefit reserves recoverable				4,100,000		4,100,000
Loss on disposal			$ 621,300
Funds withheld asset				5,000,000		5,000,000
Comprehensive income (loss)				0
Life insurance product line | XL Re Life (SAC) Ltd
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Future policy benefit reserves		$ 5,200,000
Future policy benefit reserves retained		400,000		400,000		400,000
Future policy benefit reserves recoverable		$ 4,800,000
Life Funds Withheld Assets | XL Re Life (SAC) Ltd
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Underwriting profit (loss)	[1]			0	0	603	0
Comprehensive income (loss)				$ 0	$ 0	$ 603	$ 0

[1] The underwriting profit of $0.6 million relates to a premium adjustment during the six months ended June 30, 2015 relating to the Life Retro Arrangements transaction. Excluding this transaction, the impact to comprehensive income relating to the Life Retro Arrangements was nil for the three and six months ended June 30, 2015.

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Goodwill and Other Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill [Table Text Block]

The following table presents an analysis of intangible assets broken down between goodwill, intangible assets with an indefinite life and intangible assets with a definite life for the six months ended June 30, 2015:

(U.S. dollars in thousands)	Goodwill			Intangible assets with an indefinite life		Intangible assets with a definite life			Total
Balance at December 31, 2014	$	415,936		$	15,366	$	16,650		$	447,952
Additions	778,043			673,000		315,000			1,766,043
Amortization	—			—		(4,335		)	(4,335		)
Foreign Currency Translation	(3,749		)	—		—			(3,749		)
Balance at June 30, 2015	$	1,190,230		$	688,366	$	327,315		$	2,205,911

Schedule Of Acquired Intangible Assets By Major Class [Table Text Block]

The following table summarizes the intangible assets and their related useful lives recorded in connection with the Catlin Acquisition as of the Acquisition Date:

(U.S. dollars in thousands)	Amount		Estimated Useful Life
Lloyd's - Syndicate capacity	$	660,000	Indefinite
Insurance licenses	13,000		Indefinite
Total identified indefinite life intangible assets	$	673,000
Lloyd's - Managing agent contracts	15,000		15 years
Distribution network	290,000		20 years
Trademarks / Trade names	10,000		2 years
Total identified definite life intangible assets	$	315,000
Total identified intangible assets	$	988,000

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Derivative Instruments (Tables)

6 Months Ended

Jun. 30, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of location and gross amounts of derivative fair values

The following table summarizes information on the location and gross amounts of derivative fair values contained in the consolidated balance sheets as of June 30, 2015 and December 31, 2014:

	June 30, 2015								December 31, 2014
(U.S. dollars in thousands)	Asset Derivative Notional Amount		Asset Derivative Fair Value (1)		Liability Derivative Notional Amount		Liability Derivative Fair Value (1)		Asset Derivative Notional Amount		Asset Derivative Fair Value (1)		Liability Derivative Notional Amount		Liability Derivative Fair Value (1)
Derivatives designated as hedging instruments:
Foreign exchange contracts	$	1,834,298	$	209,675	$	720,027	$	52,188	$	2,300,609	$	121,862	$	302,211	$	2,936
Total derivatives designated as hedging instruments	$	1,834,298	$	209,675	$	720,027	$	52,188	$	2,300,609	$	121,862	$	302,211	$	2,936
Derivatives not designated as hedging instruments:
Investment Related Derivatives:
Interest rate exposure	$	10,684	$	194	$	33,934	$	44	$	394,597	$	206	$	20,782	$	51
Foreign exchange exposure	301,260		1,628		139,215		3,786		7,385		403		207,182		4,442
Credit exposure	8,963		814		51,614		12,613		2,408		165		14,270		9,836
Financial market exposure	58,875		2,608		34,794		405		46,145		360		33,670		34
Other Non-Investment Derivatives:
Foreign exchange contracts	79,101		164		8,517		527		—		—		81,194		282
Credit exposure	30,281		71		—		—		31,060		60		—		—
Guaranteed minimum income benefit contract	45,006		13,321		45,006		13,321		46,249		13,603		46,249		13,603
Modified coinsurance funds withheld contracts (2)	65,663		—		4,954,481		—		64,947		—		5,401,278		—
Total derivatives not designated as hedging instruments	$	599,833	$	18,800	$	5,267,561	$	30,696	$	592,791	$	14,797	$	5,804,625	$	28,248

____________

(1) Derivative instruments in an asset or liability position are included within Other assets or Other liabilities, respectively, in the balance sheets on a net basis where the Company has both a legal right of offset and the intention to settle the contracts on a net basis.

(2) The fair value movements in derivative assets and liabilities relating to modified coinsurance funds withheld contracts are included within the associated asset or liability at each period end on the face of the balance sheets. Notional amounts associated with reinsurance agreements under which the Company assumes reinsurance risk are recorded as asset derivative notional amounts. Notional amounts associated with the Life Retro Arrangements under which the Company cedes reinsurance risk are recorded as liability derivative notional amounts. Included in the liability derivative notional amount as of June 30, 2015 is the cumulative net realized and unrealized loss on life retrocession embedded derivative of $381.3 million.

Summary of gross and net amounts of derivative fair values and associated collateral received or paid

The following table summarizes information on the gross and net amounts of derivative fair values and associated collateral received related to derivative assets, or collateral provided related to derivative liabilities, reported in other assets and or other liabilities within our consolidated balance sheets as of June 30, 2015 and December 31, 2014:

							Gross Amounts Not Offset in the Balance Sheets
June 30, 2015 (U.S. dollars in thousands)	Gross Amounts Recognized in the Balance Sheets		Gross Amounts Offset in the Balance Sheets		Net Amounts in the Balance Sheets		Financial Instruments		Cash Collateral		Net Amounts
Derivative Assets	$	228,475	$	3,239	$	225,236	$	—	$	132,050	$	93,186
Derivative Liabilities	$	82,884	$	3,239	$	79,645	$	—	$	—	$	79,645
December 31, 2014 (U.S. dollars in thousands)
Derivative Assets	$	136,659	$	696	$	135,963	$	—	$	78,580	$	57,383
Derivative Liabilities	$	31,184	$	696	$	30,488	$	—	$	—	$	30,488

Gain (loss) recognized in income attributable to risk of hedged items

The following table provides the total impact on earnings relating to derivative instruments formally designated as fair value hedges along with the impacts of the related hedged items for the three and six months ended June 30, 2015 and 2014:

				Hedged Items - Amount of Gain/(Loss) Recognized in Income Attributable to Risk
Derivatives Designated as Fair Value Hedges: Three Months Ended June 30, 2015 (U.S. dollars in thousands)	Gain/(Loss) Recognized in Income on Derivative				Fixed Maturity Investments		Ineffective Portion of Hedging Relationship - Gain/(Loss)
Interest rate exposure	$	—
Foreign exchange exposure	—
Total	$	—			$	—	$	—
Three Months Ended June 30, 2014
(U.S. dollars in thousands)
Interest rate exposure	$	—
Foreign exchange exposure	(9,132		)
Total	$	(9,132	)		$	7,082	$	(2,050	)
Six Months Ended June 30, 2015
(U.S. dollars in thousands)
Interest rate exposure	$	—
Foreign exchange exposure	—
Total	$	—			$	—	$	—
Six Months Ended June 30, 2014
(U.S. dollars in thousands)
Interest rate exposure	$	—
Foreign exchange exposure	(15,663		)
Total	$	(15,663	)		$	15,407	$	(256	)

Summary of fair value hedges that have been settled and their impact on results

A summary of the fair value hedges that have been settled and their impact on results during the indicated periods as well as the remaining balance of fair value hedges and average years remaining to maturity as of June 30, 2015 and 2014 are shown below:

Settlement of Fair Value Hedges - Summary	Fair Value Hedges - Notes Payable and Debt June 30,				Fair Value Hedges - Deposit Liabilities June 30,
(U.S. dollars in thousands, except years)	2015		2014		2015		2014
Cumulative reduction to interest expense	$	—	$	20,810	$	99,141	$	90,615
Remaining balance	$	—	$	814	$	134,054	$	142,580
Weighted average years remaining to maturity	0.0		0.2		22.4		24.0

Summary of hedges of net investment in foreign operation

The following table provides the weighted average U.S. dollar equivalent of foreign denominated net assets that were hedged and the resulting derivative gain (loss) that was recorded in the Foreign currency translation adjustment, net of tax, account within AOCI for the three and six months ended June 30, 2015 and 2014:

Derivative Instruments Designated as Hedges of the Net Investment in a Foreign Operation - Summary	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015		2014
Weighted average of U.S. dollar equivalent of foreign denominated net assets	$	1,815,593		$	2,270,090		$	1,222,267	$	2,478,772
Derivative gains (losses) (1)	$	(30,498	)	$	(2,170	)	$	36,272	$	(1,210	)

____________

(1) Derivative gains (losses) from derivative instruments designated as hedges of the net investment in a foreign operation are recorded in the cumulative translation adjustment account within AOCI for each period.    

Summary of net realized and unrealized gains (losses) on derivative instruments

The following table provides the total impact on earnings relating to derivative instruments not formally designated as hedging instruments under authoritative accounting guidance and from the ineffective portion of fair value hedges. The impacts are all recorded through Net realized and unrealized gains (losses) on derivatives in the income statement for the three and six months ended June 30, 2015 and 2014:

Net Realized and Unrealized Gains (Losses) on Derivative Instruments	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Investment Related Derivatives:
Interest rate exposure	$	(6,563	)	$	8,978		$	3,073		$	9,326
Foreign exchange exposure	482			(1,490		)	(880		)	1,798
Credit exposure	(386		)	411			(305		)	7
Financial market exposure	(1,645		)	2,508			1,398			3,378
Financial Operations Derivatives:
Credit exposure	—			447			—			(4,353		)
Other Non-Investment Derivatives:
Foreign exchange contracts	55,372			—			57,431			—
Credit exposure	132			—			1,478			—
Guaranteed minimum income benefit contract	—			633			—			2,257
Modified coinsurance funds withheld contract	1,117			2,162			2,835			1,252
Total gain (loss) recognized in income from derivatives not designated as hedging instruments	$	48,509		$	13,649		$	65,030		$	13,665
Amount of gain (loss) recognized in income from ineffective portion of fair value hedges	—			(2,050		)	—			(256		)
Net realized and unrealized gains (losses) on derivative instruments	$	48,509		$	11,599		$	65,030		$	13,409
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	$	239,174		$	(17,546	)	$	9,807		$	(17,546	)

Components of life retrocession embedded derivatives

The change in the value of the life retrocession embedded derivative includes the interest income, realized and unrealized gains and losses on Life Funds Withheld Assets and certain related expenses subsequent to May 30, 2014 as follows:

Components of Life Retrocession Embedded Derivative and Derivative Instruments - Life Funds Withheld Assets:	Three months ended June 30,						Six Months Ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Interest income - Life Funds Withheld Assets	$	(47,873	)	(19,944		)	(98,869		)	(19,944		)
Realized and unrealized gains (losses) - Life Funds Withheld Assets	321,038			1,893			168,208			1,893
Other	59			505			155			505
Net realized and unrealized gains (losses) on life retrocession embedded derivative	$	273,224		$	(17,546	)	$	69,494		$	(17,546	)
Net adjustments related to future policy benefit reserves, net of tax	$	(35,929	)	$	—		$	(47,883	)	$	—
Net realized and unrealized gains (losses) on derivative instruments - Life Funds Withheld Assets	$	1,879		$	—		$	(11,804	)	$	—
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	$	239,174		$	(17,546	)	$	9,807		$	(17,546	)

Summary of contingent credit features

The aggregate fair value of all derivative agreements containing such rating downgrade provisions that were in a liability position and any collateral posted under these agreements as of June 30, 2015 and December 31, 2014 were as follows:

Contingent Credit Features - Summary: (U.S. dollars in thousands)	June 30, 2015		December 31, 2014
Aggregate fair value of derivative agreements with downgrade provisions in a net liability position	$	21,545	$	5,770
Collateral posted to counterparty	$	12,390	$	—

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Investments - Narrative (Details) $ in Thousands		3 Months Ended		6 Months Ended
	May. 01, 2014 USD ($)	Jun. 30, 2015 USD ($) positions	Jun. 30, 2014 USD ($)	Jun. 30, 2015 USD ($) positions	Jun. 30, 2014 USD ($)	Dec. 31, 2014 USD ($)
Schedule of Available-for-sale Securities [Line Items]
Change in adjustments related to future policy benefit reserves, net of tax		$ (26,328)	$ 440,461	$ (86,684)	$ 474,465
Fixed maturities, at fair value		33,767,991		33,767,991		$ 29,359,034
Amortized cost of fixed maturities		$ 32,699,709		$ 32,699,709		$ 27,728,771
Percentage of Fixed Income Investment portfolio invested in below investment grade or not rated		2.50%		2.50%		3.00%
Percentage of Gross Unrealized losses in Fixed income securities portfolio related to securities below investment grade or not rated		14.80%		14.80%		24.90%
Available for sale securities, Gross unrealized losses		$ 282,751		$ 282,751		$ 213,576
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | positions		2,944		2,944
Available-for-sale Securities, Qualitative Disclosure, Number of Positions | positions		8,969		8,969
Pledged Assets Separately Reported, Other Debt Securities Available-for-sale or Held-for-investment		$ 18,400,000		$ 18,400,000		15,200,000
Other than Temporary Impairment, Credit Losses Recognized in Earnings, Reductions, Securities Sold		8,495	3,322	37,034	7,571
Corporate
Schedule of Available-for-sale Securities [Line Items]
Other than Temporary Impairment Losses, Investments, Portion Recognized in Earnings, Net, Available-for-sale Securities		4,800
Medium term notes
Schedule of Available-for-sale Securities [Line Items]
Fixed maturities, at fair value		75,300		75,300		79,900
Amortized cost of fixed maturities		64,500		64,500		68,400
Alternative Funds [Member]
Schedule of Available-for-sale Securities [Line Items]
Other than Temporary Impairment Losses, Investments, Portion Recognized in Earnings, Net, Available-for-sale Securities		4,000
Structured Credit Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Marketable Securities		6,900		6,900
Marketable Securities Unrealized Loss Other Than Temporary Impairments Amount		$ 8,800		$ 8,800
Impaired Investment Cumulative Fair Value Decline Percentage Amortized Cost		50.00%		50.00%
RMBS - Non-Agency
Schedule of Available-for-sale Securities [Line Items]
Other than Temporary Impairment Losses, Investments, Portion Recognized in Earnings, Net, Available-for-sale Securities		$ 200
Other than Temporary Impairment, Credit Losses Recognized in Earnings, Reductions, Securities Sold		1,700	2,500	$ 28,900	5,200
Foreign Currency Adjustments [Member]
Schedule of Available-for-sale Securities [Line Items]
Other than Temporary Impairment Losses, Investments, Portion Recognized in Earnings, Net, Available-for-sale Securities		800
Equities
Schedule of Available-for-sale Securities [Line Items]
Other than Temporary Impairment Losses, Investments, Portion Recognized in Earnings, Net, Available-for-sale Securities		300
Other investments
Schedule of Available-for-sale Securities [Line Items]
Other than Temporary Impairment Losses, Investments, Portion Recognized in Earnings, Net, Available-for-sale Securities		6,500
XL Re Life (SAC) Ltd
Schedule of Available-for-sale Securities [Line Items]
Held To Maturity Securities Transferred Security Carrying Value	$ 2,800,000
Unrealized gains on held to maturity investment portfolio at time of transfer to available for sale, net of tax	424,900
Fixed maturites held to maturity, gross unrealized losses	0
Unrealized gains (losses) on investments
Schedule of Available-for-sale Securities [Line Items]
Change in adjustments related to future policy benefit reserves, net of tax				(86,700)
Unrealized gains (losses) on investments | XL Re Life (SAC) Ltd
Schedule of Available-for-sale Securities [Line Items]
Change in adjustments related to future policy benefit reserves, net of tax	$ 440,500
Excluding Life Funds Withheld Assets
Schedule of Available-for-sale Securities [Line Items]
Fixed maturities, at fair value		29,770,903		29,770,903		24,177,469
Amortized cost of fixed maturities		29,310,791		29,310,791		23,427,432
Available for sale securities, Gross unrealized losses		282,751		282,751		213,576
Other than Temporary Impairment Losses, Investments, Portion Recognized in Earnings, Net, Available-for-sale Securities		16,588	$ 24,616	27,164	$ 28,343
Excluding Life Funds Withheld Assets | RMBS - Non-Agency
Schedule of Available-for-sale Securities [Line Items]
Fixed maturities, at fair value		372,271		372,271		427,351
Amortized cost of fixed maturities		$ 361,661		$ 361,661		$ 404,398

XML

Fair Value Measurements - Schedule of assets and liabilities that were accounted for at fair value (Details) - USD ($) $ in Thousands		Jun. 30, 2015		Dec. 31, 2014
Assets
Fixed maturities, at fair value		$ 33,767,991		$ 29,359,034
Equity securities, at fair value		1,073,470		868,292
Short-term investments, at fair value		807,486		256,727
Total investments available for sale		35,648,947		30,484,053
Fixed maturities, trading at fair value		748,931		1,171
Collateral and counterparty netting, assets	[1]	(3,239)		(696)
Liabilities
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable)		915,116		1,155,016
Collateral and counterparty nettings, liabilities	[1]	(3,239)		(696)
Recurring
Assets
Total investments available for sale		35,648,947		30,484,053
Cash equivalents	[2]	975,876		1,501,832
Other investments	[3]	1,395,065		894,057
Other assets	[1]	225,236		135,963
Total assets accounted for at fair value		39,128,118		33,150,274
Liabilities
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable)	[4]	381,337		450,831
Financial instruments sold, but not yet purchased	[5]	2,814		30,406
Other liabilities	[1]	79,645		30,488
Total liabilities accounted for at fair value		463,796		511,725
Recurring | Quoted prices in active markets for identical assets (Level 1)
Assets
Total investments available for sale		659,338		502,284
Cash equivalents	[2]	705,092		1,103,877
Other investments		0		0
Other assets		0		0	[1]
Total assets accounted for at fair value		1,364,573		1,606,621
Liabilities
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable)	[4]	0		0
Financial instruments sold, but not yet purchased	[5]	1,581		4,737
Other liabilities	[1]	0		0
Total liabilities accounted for at fair value		1,581		4,737
Recurring | Significant other observable inputs (Level 2)
Assets
Total investments available for sale		34,444,101		29,280,719
Cash equivalents	[2]	270,784		397,955
Other investments	[3]	1,139,393		708,974
Other assets	[1]	215,083		122,996
Total assets accounted for at fair value		36,952,212		30,644,553
Liabilities
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable)	[4]	381,337		450,831
Financial instruments sold, but not yet purchased	[5]	1,233		25,669
Other liabilities	[1]	59,739		7,757
Total liabilities accounted for at fair value		442,309		484,257
Recurring | Significant other unobservable inputs (Level 3)
Assets
Total investments available for sale		545,508		701,050
Cash equivalents	[2]	0		0
Other investments	[3]	255,672		185,083
Other assets	[1]	13,392		13,663
Total assets accounted for at fair value		814,572		899,796
Liabilities
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable)	[4]	0		0
Financial instruments sold, but not yet purchased		0	[5]	0
Other liabilities	[1]	23,145		23,427
Total liabilities accounted for at fair value		23,145		23,427
Excluding Life Funds Withheld Assets
Assets
Fixed maturities, at fair value		29,770,903		24,177,469
Equity securities, at fair value		1,073,470		868,292
Short-term investments, at fair value		807,486		256,727
Total investments available for sale		31,651,859		25,302,488
Excluding Life Funds Withheld Assets | U.S. Government and Government - Related/Supported
Assets
Fixed maturities, at fair value		3,827,106		2,171,953
Excluding Life Funds Withheld Assets | RMBS - Agency
Assets
Fixed maturities, at fair value		3,958,144		3,728,576
Excluding Life Funds Withheld Assets | RMBS - Non-Agency
Assets
Fixed maturities, at fair value		372,271		427,351
Excluding Life Funds Withheld Assets | Commercial mortgage-backed securities
Assets
Fixed maturities, at fair value		936,058		1,052,544
Excluding Life Funds Withheld Assets | Collateralized debt obligations
Assets
Fixed maturities, at fair value		488,025		692,034
Excluding Life Funds Withheld Assets | Other asset-backed securities
Assets
Fixed maturities, at fair value		2,350,387	[6]	1,065,293	[7]
Excluding Life Funds Withheld Assets | US States and political subdivisions of the States
Assets
Fixed maturities, at fair value		2,391,273		2,021,272
Excluding Life Funds Withheld Assets | Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Assets
Fixed maturities, at fair value		5,260,062		4,240,073
Excluding Life Funds Withheld Assets | Recurring
Assets
Fixed maturities, at fair value		29,770,903		24,177,469
Equity securities, at fair value		1,073,470		868,292
Short-term investments, at fair value	[8],[9]	807,486		256,727
Total investments available for sale		31,651,859		25,302,488
Excluding Life Funds Withheld Assets | Recurring | U.S. Government and Government - Related/Supported
Assets
Fixed maturities, at fair value		3,827,106		2,171,953
Excluding Life Funds Withheld Assets | Recurring | RMBS - Agency
Assets
Fixed maturities, at fair value		3,958,144		3,728,576
Excluding Life Funds Withheld Assets | Recurring | RMBS - Non-Agency
Assets
Fixed maturities, at fair value		372,271		427,351
Excluding Life Funds Withheld Assets | Recurring | Commercial mortgage-backed securities
Assets
Fixed maturities, at fair value		936,058		1,052,544
Excluding Life Funds Withheld Assets | Recurring | Collateralized debt obligations
Assets
Fixed maturities, at fair value		488,025		692,034
Excluding Life Funds Withheld Assets | Recurring | Other asset-backed securities
Assets
Fixed maturities, at fair value	[8]	2,350,387		1,065,293
Excluding Life Funds Withheld Assets | Recurring | US States and political subdivisions of the States
Assets
Fixed maturities, at fair value		2,391,273		2,021,272
Excluding Life Funds Withheld Assets | Recurring | Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Assets
Fixed maturities, at fair value		5,260,062		4,240,073
Excluding Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1)
Assets
Fixed maturities, at fair value		0		0
Equity securities, at fair value		659,338		502,284
Short-term investments, at fair value	[8],[9]	0		0
Total investments available for sale		659,338		502,284
Excluding Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | U.S. Government and Government - Related/Supported
Assets
Fixed maturities, at fair value		0		0
Excluding Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | RMBS - Agency
Assets
Fixed maturities, at fair value		0		0
Excluding Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | RMBS - Non-Agency
Assets
Fixed maturities, at fair value		0		0
Excluding Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | Commercial mortgage-backed securities
Assets
Fixed maturities, at fair value		0		0
Excluding Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | Collateralized debt obligations
Assets
Fixed maturities, at fair value		0		0
Excluding Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | Other asset-backed securities
Assets
Fixed maturities, at fair value	[8]	0		0
Excluding Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | US States and political subdivisions of the States
Assets
Fixed maturities, at fair value		0		0
Excluding Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Assets
Fixed maturities, at fair value		0		0
Excluding Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2)
Assets
Fixed maturities, at fair value		29,225,395		23,476,419
Equity securities, at fair value		414,132		366,008
Short-term investments, at fair value	[8],[9]	807,486		256,727
Total investments available for sale		30,447,013		24,099,154
Excluding Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | U.S. Government and Government - Related/Supported
Assets
Fixed maturities, at fair value		3,827,106		2,171,953
Excluding Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | RMBS - Agency
Assets
Fixed maturities, at fair value		3,955,106		3,726,666
Excluding Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | RMBS - Non-Agency
Assets
Fixed maturities, at fair value		372,271		427,351
Excluding Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | Commercial mortgage-backed securities
Assets
Fixed maturities, at fair value		936,058		1,052,544
Excluding Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | Collateralized debt obligations
Assets
Fixed maturities, at fair value		3,854		4,076
Excluding Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | Other asset-backed securities
Assets
Fixed maturities, at fair value	[8]	2,307,642		1,060,005
Excluding Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | US States and political subdivisions of the States
Assets
Fixed maturities, at fair value		2,391,273		2,021,272
Excluding Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Assets
Fixed maturities, at fair value		5,260,062		4,240,073
Excluding Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3)
Assets
Fixed maturities, at fair value		545,508		701,050
Equity securities, at fair value		0		0
Short-term investments, at fair value	[8],[9]	0		0
Total investments available for sale		545,508		701,050
Excluding Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | U.S. Government and Government - Related/Supported
Assets
Fixed maturities, at fair value		0		0
Excluding Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | RMBS - Agency
Assets
Fixed maturities, at fair value		3,038		1,910
Excluding Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | RMBS - Non-Agency
Assets
Fixed maturities, at fair value		0		0
Excluding Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | Commercial mortgage-backed securities
Assets
Fixed maturities, at fair value		0		0
Excluding Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | Collateralized debt obligations
Assets
Fixed maturities, at fair value		484,171		687,958
Excluding Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | Other asset-backed securities
Assets
Fixed maturities, at fair value	[8]	42,745		5,288
Excluding Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | US States and political subdivisions of the States
Assets
Fixed maturities, at fair value		0		0
Excluding Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Assets
Fixed maturities, at fair value		0		0
Life Funds Withheld Assets
Assets
Fixed maturities, at fair value		3,997,088		5,181,565
Fixed maturities, trading at fair value		791,484		1,171
Life Funds Withheld Assets | U.S. Government and Government - Related/Supported
Assets
Fixed maturities, at fair value		13,678		18,724
Fixed maturities, trading at fair value		3,596
Life Funds Withheld Assets | RMBS - Agency
Assets
Fixed maturities, at fair value		837		3,782
Life Funds Withheld Assets | RMBS - Non-Agency
Assets
Fixed maturities, at fair value		29,591		85,335
Life Funds Withheld Assets | Commercial mortgage-backed securities
Assets
Fixed maturities, at fair value		145,617		193,167
Fixed maturities, trading at fair value		261
Life Funds Withheld Assets | Other asset-backed securities
Assets
Fixed maturities, at fair value		187,537		273,541
Fixed maturities, trading at fair value		14,823
Life Funds Withheld Assets | Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Assets
Fixed maturities, at fair value		1,231,228		1,789,036
Fixed maturities, trading at fair value		252,981
Life Funds Withheld Assets | Recurring
Assets
Fixed maturities, at fair value		3,997,088		5,181,565
Fixed maturities, trading at fair value		791,484		1,171
Cash equivalents	[2]	91,510		133,198
Life Funds Withheld Assets | Recurring | U.S. Government and Government - Related/Supported
Assets
Fixed maturities, at fair value		13,678		18,724
Fixed maturities, trading at fair value		3,596
Life Funds Withheld Assets | Recurring | RMBS - Agency
Assets
Fixed maturities, at fair value		837		3,782
Life Funds Withheld Assets | Recurring | RMBS - Non-Agency
Assets
Fixed maturities, at fair value		29,591		85,335
Life Funds Withheld Assets | Recurring | Commercial mortgage-backed securities
Assets
Fixed maturities, at fair value		145,617		193,167
Fixed maturities, trading at fair value		261
Life Funds Withheld Assets | Recurring | Other asset-backed securities
Assets
Fixed maturities, at fair value		187,537		273,541
Fixed maturities, trading at fair value		14,823
Life Funds Withheld Assets | Recurring | Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Assets
Fixed maturities, at fair value		1,231,228		1,789,036
Fixed maturities, trading at fair value		252,981
Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1)
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0		0
Cash equivalents	[2]	143		460
Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | U.S. Government and Government - Related/Supported
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0
Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | RMBS - Agency
Assets
Fixed maturities, at fair value		0		0
Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | RMBS - Non-Agency
Assets
Fixed maturities, at fair value		0		0
Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | Commercial mortgage-backed securities
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0
Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | Other asset-backed securities
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0
Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0
Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2)
Assets
Fixed maturities, at fair value		3,997,088		5,181,565
Fixed maturities, trading at fair value		791,484		1,171
Cash equivalents	[2]	91,367		132,738
Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | U.S. Government and Government - Related/Supported
Assets
Fixed maturities, at fair value		13,678		18,724
Fixed maturities, trading at fair value		3,596
Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | RMBS - Agency
Assets
Fixed maturities, at fair value		837		3,782
Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | RMBS - Non-Agency
Assets
Fixed maturities, at fair value		29,591		85,335
Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | Commercial mortgage-backed securities
Assets
Fixed maturities, at fair value		145,617		193,167
Fixed maturities, trading at fair value		261
Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | Other asset-backed securities
Assets
Fixed maturities, at fair value		187,537		273,541
Fixed maturities, trading at fair value		14,823
Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Assets
Fixed maturities, at fair value		1,231,228		1,789,036
Fixed maturities, trading at fair value		252,981
Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3)
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0		0
Cash equivalents	[2]	0		0
Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | U.S. Government and Government - Related/Supported
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0
Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | RMBS - Agency
Assets
Fixed maturities, at fair value		0		0
Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | RMBS - Non-Agency
Assets
Fixed maturities, at fair value		0		0
Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | Commercial mortgage-backed securities
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0
Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | Other asset-backed securities
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0
Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0
Financial Services Sector [Member] | Excluding Life Funds Withheld Assets | Corporate
Assets
Fixed maturities, at fair value		3,235,513		2,761,916
Financial Services Sector [Member] | Excluding Life Funds Withheld Assets | Recurring | Corporate
Assets
Fixed maturities, at fair value		3,235,513		2,761,916
Financial Services Sector [Member] | Excluding Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | Corporate
Assets
Fixed maturities, at fair value		0		0
Financial Services Sector [Member] | Excluding Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | Corporate
Assets
Fixed maturities, at fair value		3,225,513		2,761,916
Financial Services Sector [Member] | Excluding Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | Corporate
Assets
Fixed maturities, at fair value		10,000		0
Financial Services Sector [Member] | Life Funds Withheld Assets | Corporate
Assets
Fixed maturities, at fair value		722,922		801,019
Fixed maturities, trading at fair value		187,169
Financial Services Sector [Member] | Life Funds Withheld Assets | Recurring | Corporate
Assets
Fixed maturities, at fair value		722,922		801,019
Fixed maturities, trading at fair value		187,169
Financial Services Sector [Member] | Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | Corporate
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0
Financial Services Sector [Member] | Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | Corporate
Assets
Fixed maturities, at fair value		722,922		801,019
Fixed maturities, trading at fair value		187,169
Financial Services Sector [Member] | Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | Corporate
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0
Non-Financial Services Sector [Member] | Excluding Life Funds Withheld Assets | Corporate
Assets
Fixed maturities, at fair value		6,952,064	[6]	6,016,457	[7]
Non-Financial Services Sector [Member] | Excluding Life Funds Withheld Assets | Recurring | Corporate
Assets
Fixed maturities, at fair value	[8]	6,952,064		6,016,457
Non-Financial Services Sector [Member] | Excluding Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | Corporate
Assets
Fixed maturities, at fair value	[8]	0		0
Non-Financial Services Sector [Member] | Excluding Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | Corporate
Assets
Fixed maturities, at fair value	[8]	6,946,510		6,010,563
Non-Financial Services Sector [Member] | Excluding Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | Corporate
Assets
Fixed maturities, at fair value	[8]	5,554		5,894
Non-Financial Services Sector [Member] | Life Funds Withheld Assets | Corporate
Assets
Fixed maturities, at fair value		1,665,678		2,016,961
Fixed maturities, trading at fair value		332,654		1,171
Non-Financial Services Sector [Member] | Life Funds Withheld Assets | Recurring | Corporate
Assets
Fixed maturities, at fair value		1,665,678		2,016,961
Fixed maturities, trading at fair value		332,654		1,171
Non-Financial Services Sector [Member] | Life Funds Withheld Assets | Recurring | Quoted prices in active markets for identical assets (Level 1) | Corporate
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		0		0
Non-Financial Services Sector [Member] | Life Funds Withheld Assets | Recurring | Significant other observable inputs (Level 2) | Corporate
Assets
Fixed maturities, at fair value		1,665,678		2,016,961
Fixed maturities, trading at fair value		332,654		1,171
Non-Financial Services Sector [Member] | Life Funds Withheld Assets | Recurring | Significant other unobservable inputs (Level 3) | Corporate
Assets
Fixed maturities, at fair value		0		0
Fixed maturities, trading at fair value		$ 0		$ 0

[1] Other assets and other liabilities include derivative instruments. The derivative balances included in each category are reported on a gross basis by level with a netting adjustment presented separately in the Collateral and Counterparty Netting column. The fair values of the individual derivative contracts are reported gross in their respective levels based on the fair value hierarchy. For further details regarding derivative fair values and associated collateral received or paid see Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements.

[2] Cash equivalents balances subject to fair value measurement include certificates of deposit and money market funds. Operating cash balances are not subject to recurring fair value measurement guidance.

[3] The Other investments balance excludes certain structured transactions including certain investments in project finance transactions, and a payment obligation and liquidity financing provided to a structured credit vehicle as a part of a third party medium term note facility. These investments, which totaled $348.2 million as of June 30, 2015 and $354.4 million at December 31, 2014, are carried at amortized cost. For further information, see Item 8, Note 8, "Other Investments," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

[4] Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable) include balances related to the life retrocession embedded derivative, under which all investment results associated with the Life Funds Withheld Assets related to the Life Retro Arrangements described in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," accrue to the benefit of GCLR.

[5] Financial instruments sold, but not yet purchased, represent "short sales" and are included within "Payable for investments purchased" on the balance sheets.

[6] Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $75.3 million and an amortized cost of $64.5 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

[7] Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $79.9 million and an amortized cost of $68.4 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

[8] Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes had a fair value of $75.3 million and $79.9 million and an amortized cost of $64.5 million and $68.4 million as of June 30, 2015 and December 31, 2014, respectively. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate values of these notes.

[9] Short-term investments consist primarily of Corporate securities and U.S. and Non-U.S. Government and Government-Related/Supported securities.

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Share Capital (Tables)

6 Months Ended

Jun. 30, 2015

Stockholders' Equity Note [Abstract]

Summary of shares issued and outstanding

The following table is a summary of ordinary shares issued and outstanding:

(in thousands)	June 30, 2015		December 31, 2014
Balance – beginning of period	255,183		278,253
Exercise of options	220		424
Net issuance of restricted shares	1,536		1,246
Share buybacks (1)	(2,982	)	(24,740	)
Issue of shares	49,935		—
Balance – end of period	303,892		255,183

____________

(1) Includes share buybacks associated with authorized share buyback programs as well as purchases related to satisfying tax withholding obligations of employees in connection with the vesting of restricted shares granted under the Company's equity compensation programs.

Schedule of Valuation Assumptions - Stock Options

The fair value of the options issued was estimated on the date of grant using the Black-Scholes option pricing model using the following weighted average assumptions:

Dividend yield	2.00	%
Risk free interest rate	1.70	%
Volatility	21.6	%
Expected lives	6.0 years

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Notes Payable and Debt and Financing Arrangements (Tables)

6 Months Ended

Jun. 30, 2015

Debt Disclosure [Abstract]

Schedule of financing structure

As of June 30, 2015, the Company's financing structure, which includes senior and subordinated notes, and bank and loan facilities available from a variety of sources, including commercial banks, is as follows:

(U.S. dollars in thousands)	June 30, 2015				December 31, 2014
	Commitment/ Debt (1)		In Use/ Outstanding (2)		Commitment/ Debt (1)		In Use/ Outstanding (2)
Debt:
2.30% Senior Notes due 2018	300,000		297,679		300,000		297,344
5.75% Senior Notes due 2021	400,000		397,307		400,000		397,092
6.375% Senior Notes due 2024	350,000		348,975		350,000		348,920
4.45% Subordinated Notes due 2025	500,000		492,292		—		—
6.25% Senior Notes due 2027	325,000		323,140		325,000		323,062
Variable Rate Note, face amount €7m, due 2035	7,794		7,301		—		—
Variable Rate Note, face amount $27m, due 2036	27,000		25,259		—		—
Variable Rate Note, face amount $31m, due 2036	31,300		29,281		—		—
Variable Rate Note, face amount $10m, due 2036	9,800		9,168		—		—
Variable Rate Note, face amount €11m, due 2036	12,248		11,473		—		—
5.25% Senior Notes due 2043	300,000		296,228		300,000		296,162
5.5% Subordinated Notes due 2045	500,000		488,352		—		—
Total debt carrying value	$	2,763,142	$	2,726,455	$	1,675,000	$	1,662,580

_______________

(1) Excluded from the table are revolving credit facilities of $1.7 billion and $1.6 billion as of June 30, 2015 and December 31, 2014, respectively. As of June 30, 2015 and December 31, 2014, $667.9 million and $606.1 million, respectively, were utilized under these facilities to issue letters of credit, leaving $1.0 billion and $968.9 million, respectively, available for use under the revolving credit facilities.

(2)    "In Use" and "Outstanding" data represent June 30, 2015 and December 31, 2014 accreted values.

Letter of Credit Summary

The Company’s letter of credit facilities and revolving credit facilities as of June 30, 2015 and December 31, 2014 were as follows:

Letter of Credit Summary: (U.S. dollars in thousands except percentages)	June 30, 2015 (1)			December 31, 2014 (1)
Revolving credit facilities (2) (3)	$	1,032,100		$	968,900
Available letter of credit facilities - commitments (4)	$	4,855,000		$	3,575,000
Available letter of credit facilities - in use	$	2,585,348		$	1,790,561
Collateralized by certain assets of the Company’s investment portfolio	50.2		%	66.2		%

____________

(1) As of June 30, 2015 and December 31, 2014, there were eighteen and eight available letter of credit facilities, respectively.

(2) As of June 30, 2015 and December 31, 2014, $976.1 million and $968.9 million, respectively, of revolving credit was available under the Company's syndicated unsecured credit agreement, which currently provides for up to $1 billion of revolving credit loans. The Company has the option to increase the size of the facilities under the syndicated secured and unsecured credit agreements by an additional $500 million across both facilities. Two bilateral facilities assumed as a result of the Catlin Acquisition with commitments totaling $150.0 million also provide for revolving credit loans. As of June 30, 2015, $56.0 million of revolving credit was available to draw under these facilities.

(3) The credit agreements initially entered into with Citicorp USA, Inc. in May through November 2013 (the "Citi Agreements") provide for issuance of letters of credit and revolving credit loans up to an aggregate amount of $550.0 million, compared to $575.0 million as of December 31, 2014. As of June 30, 2015, $550.0 million of letters of credit were issued under these agreements, and therefore no amounts are included in this line as available to draw under this facility. The Company also has the option to increase the maximum amount of the letters of credit and revolving credit loans available under the Citi Agreements with the lender's and issuing lender's consent.

(4) The available letter of credit facilities include approximately $1 billion that is also included in the "revolving credit facilities" line in this table.

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Basis of Preparation and Consolidation

6 Months Ended

Jun. 30, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Preparation and Consolidation

Basis of Preparation and Consolidation

Unless the context otherwise indicates, references herein to the "Company" include XL Group plc, an Irish public limited company ("XL-Ireland"), and its consolidated subsidiaries. On May 1, 2015, the Company completed its acquisition of Catlin Group Limited and its consolidated subsidiaries ("Catlin"). Catlin, through its wholly-owned subsidiaries, provided property, casualty and specialty insurance and reinsurance coverage on a worldwide basis. The Company's consolidated results of operations include those of Catlin from May 1, 2015. See Note 3(a), "Acquisition and Disposals - Catlin Acquisition" for additional information with respect to the acquisition of Catlin.

These unaudited consolidated financial statements include the accounts of the Company and have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and disclosures required by GAAP for complete financial statements. In addition, the year-end balance sheet data was derived from audited financial statements but do not include all disclosures required by GAAP. In the opinion of management, these unaudited financial statements reflect all adjustments considered necessary for a fair statement of financial position and results of operations at the end of and for the periods presented. The results of operations for any interim period are not necessarily indicative of the results for a full year. All inter-company accounts and transactions have been eliminated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure about contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from these estimates. For further information, see Item 8, Note 2(a), "Significant Accounting Policies – Basis of Preparation and Consolidation," to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

To facilitate period-to-period comparisons, certain reclassifications have been made to prior period consolidated financial statement amounts to conform to current period presentation.

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Related Party Transactions (Tables)

6 Months Ended

Jun. 30, 2015

Related Party Transactions [Abstract]

Summary of related party transactions

During the three and six months ended June 30, 2015 and 2014, these contracts resulted in net premiums written, net claims incurred and acquisition costs as summarized below.

(U.S. dollars in thousands)	Three months ended June 30,				Six months ended June 30,
	2015		2014		2015		2014
Net premiums written	$	4,445	$	18,025	$	31,521	$	36,191
Net losses and loss expenses incurred	$	65	$	7,692	$	9,166	$	14,301
Acquisition costs	$	1,384	$	6,994	$	10,395	$	15,553

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Acquisition and Disposals - Supplemental pro forma financial information (Details) - Catlin Group Limited - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Business Combination Pro Forma Information [Line Items]
Total revenues	$ 5,427,900	$ 5,736,519
Net income attributable to ordinary shareholders	$ 960,951	$ 107,279
Earnings (loss) per ordinary share and ordinary share equivalent – basic (in dollars per share)	$ 3.14	$ 0.33
Earnings (loss) per ordinary share and ordinary share equivalent – diluted (in dollars per share)	$ 3.09	$ 0.33

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Investments - Analysis of continual unrealized loss position (Details) - Excluding Life Funds Withheld Assets - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Total fixed maturities and short-term investments AFS
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	$ 10,056,125	$ 2,896,210
Less than 12 months Gross Unrealized Losses	(147,738)	(61,772)
Equal to or greater than 12 months Fair Value	1,734,541	2,745,705
Equal to greater than 12 months Gross Unrealized Losses	(108,226)	(125,574)
U.S. Government and Government - Related/Supported
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	1,721,385	251,091
Less than 12 months Gross Unrealized Losses	(12,211)	(1,196)
Equal to or greater than 12 months Fair Value	109,027	342,890
Equal to greater than 12 months Gross Unrealized Losses	(4,666)	(5,603)
RMBS - Agency
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	1,136,559	134,535
Less than 12 months Gross Unrealized Losses	(12,171)	(220)
Equal to or greater than 12 months Fair Value	245,806	512,652
Equal to greater than 12 months Gross Unrealized Losses	(8,649)	(10,563)
RMBS - Non-Agency
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	45,052	45,378
Less than 12 months Gross Unrealized Losses	(1,959)	(1,358)
Equal to or greater than 12 months Fair Value	197,361	202,700
Equal to greater than 12 months Gross Unrealized Losses	(15,962)	(16,797)
Commercial mortgage-backed securities
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	295,914	78,356
Less than 12 months Gross Unrealized Losses	(5,263)	(385)
Equal to or greater than 12 months Fair Value	100,100	169,065
Equal to greater than 12 months Gross Unrealized Losses	(3,048)	(4,877)
Collateralized debt obligations
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	39,969	249,803
Less than 12 months Gross Unrealized Losses	(5,506)	(2,666)
Equal to or greater than 12 months Fair Value	322,684	414,516
Equal to greater than 12 months Gross Unrealized Losses	(19,067)	(24,503)
Other asset-backed securities
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	1,014,257	143,044
Less than 12 months Gross Unrealized Losses	(6,535)	(2,813)
Equal to or greater than 12 months Fair Value	59,985	57,544
Equal to greater than 12 months Gross Unrealized Losses	(5,392)	(3,232)
US States and political subdivisions of the States
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	706,360	32,187
Less than 12 months Gross Unrealized Losses	(10,617)	(210)
Equal to or greater than 12 months Fair Value	17,546	63,695
Equal to greater than 12 months Gross Unrealized Losses	(1,181)	(994)
Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	1,736,079	624,346
Less than 12 months Gross Unrealized Losses	(38,213)	(19,043)
Equal to or greater than 12 months Fair Value	459,362	558,422
Equal to greater than 12 months Gross Unrealized Losses	(33,833)	(43,251)
Equities
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	267,759	191,193
Less than 12 months Gross Unrealized Losses	(26,787)	(26,230)
Equal to or greater than 12 months Fair Value	0	0
Equal to greater than 12 months Gross Unrealized Losses	0	0
Financial Services Sector [Member] | Corporate
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	1,054,854	387,619
Less than 12 months Gross Unrealized Losses	(13,737)	(5,858)
Equal to or greater than 12 months Fair Value	76,450	105,155
Equal to greater than 12 months Gross Unrealized Losses	(6,846)	(7,097)
Non-Financial Services Sector [Member] | Corporate
Fixed maturities and short-term investments - AFS:
Less than 12 months Fair Value	2,305,696	949,851
Less than 12 months Gross Unrealized Losses	(41,526)	(28,023)
Equal to or greater than 12 months Fair Value	146,220	319,066
Equal to greater than 12 months Gross Unrealized Losses	$ (9,582)	$ (8,657)

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Notes Payable and Debt and Financing Arrangements - Letter of credit facilities and other sources of collateral (Details) $ in Thousands, AUD in Millions		Jun. 30, 2015 USD ($) Credit_Facilities		Jun. 30, 2015 AUD Credit_Facilities	Dec. 31, 2014 USD ($) Credit_Facilities
Line of Credit Facility [Line Items]
Number of letter of credit facilities available | Credit_Facilities		18		18	8
Revolving credit facility
Line of Credit Facility [Line Items]
Available credit facilities - remaining borrowing capacity	[1],[2],[3]	$ 1,032,100			$ 968,900
Available letter of credit facilities - commitments		1,700,000			1,600,000
Available letter of credit facilities - in use		667,900			606,100
November 2013 credit agreement
Line of Credit Facility [Line Items]
Available credit facilities - remaining borrowing capacity		976,100			968,900
Available letter of credit facilities - commitments		1,000,000
Letter of credit facilities
Line of Credit Facility [Line Items]
Available letter of credit facilities - commitments	[2],[4]	4,855,000			3,575,000
Available letter of credit facilities - in use		$ 2,585,348	[2]		$ 1,790,561	[5]
Collateralized by certain assets of the Company’s investment portfolio	[2]	50.20%		50.20%	66.20%
2013 Citi agreements | Revolving credit facility
Line of Credit Facility [Line Items]
Available letter of credit facilities - commitments		$ 550,000			$ 575,000
2013 Citi agreements | Letter of credit facilities
Line of Credit Facility [Line Items]
Available letter of credit facilities - in use		550,000
Syndicated credit agreements
Line of Credit Facility [Line Items]
Optional increased capacity		500,000
Catlin Group Limited
Line of Credit Facility [Line Items]
Available letter of credit facilities - in use		1,000
Catlin Group Limited | Unsecured multi-bank facility
Line of Credit Facility [Line Items]
Available letter of credit facilities - commitments		450,000
Catlin Group Limited | Letter of credit facilities
Line of Credit Facility [Line Items]
Available letter of credit facilities - in use		8,000
Catlin Group Limited | Bilateral facility
Line of Credit Facility [Line Items]
Available credit facilities - remaining borrowing capacity		56,000
Available letter of credit facilities - commitments		$ 150,000		AUD 50
Number of letter of credit facilities available | Credit_Facilities		2		2
Catlin Bermuda | Bilateral facility
Line of Credit Facility [Line Items]
Available letter of credit facilities - in use		$ 147,000
Catlin Bermuda | LLoyd's syndicate | Bilateral facility
Line of Credit Facility [Line Items]
Available letter of credit facilities - commitments		$ 375,000
Number of letter of credit facilities available | Credit_Facilities		4		4
Catlin Re Switzerland | Bilateral facility
Line of Credit Facility [Line Items]
Available letter of credit facilities - in use		$ 49,000

[1] As of June 30, 2015 and December 31, 2014, $976.1 million and $968.9 million, respectively, of revolving credit was available under the Company's syndicated unsecured credit agreement, which currently provides for up to $1 billion of revolving credit loans. The Company has the option to increase the size of the facilities under the syndicated secured and unsecured credit agreements by an additional $500 million across both facilities. Two bilateral facilities assumed as a result of the Catlin Acquisition with commitments totaling $150.0 million also provide for revolving credit loans. As of June 30, 2015, $56.0 million of revolving credit was available to draw under these facilities.

[2] As of June 30, 2015 and December 31, 2014, there were eighteen and eight available letter of credit facilities, respectively.

[3] The credit agreements initially entered into with Citicorp USA, Inc. in May through November 2013 (the "Citi Agreements") provide for issuance of letters of credit and revolving credit loans up to an aggregate amount of $550.0 million, compared to $575.0 million as of December 31, 2014. As of June 30, 2015, $550.0 million of letters of credit were issued under these agreements, and therefore no amounts are included in this line as available to draw under this facility. The Company also has the option to increase the maximum amount of the letters of credit and revolving credit loans available under the Citi Agreements with the lender's and issuing lender's consent.

[4] The available letter of credit facilities include approximately $1 billion that is also included in the "revolving credit facilities" line in this table.

[5] "In Use" and "Outstanding" data represent June 30, 2015 and December 31, 2014 accreted values.

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UNAUDITED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Investments:
Fixed maturities, at fair value (amortized cost: 2015, $32,699,709; 2014, $27,728,771)	$ 33,767,991	$ 29,359,034
Equity securities, at fair value (cost: 2015, $964,038; 2014, $763,833)	1,073,470	868,292
Short-term investments, at fair value (amortized cost: 2015, $806,990; 2014, $257,221)	807,486	256,727
Total investments available for sale	35,648,947	30,484,053
Fixed maturities, at fair value (amortized cost: 2015, $768,492; 2014, $1,180)	748,931	1,171
Short-term investments, at fair value (amortized cost: 2015, $42,557; 2014, nil)	42,553	0
Total investments trading	791,484	1,171
Investments in affiliates	1,663,852	1,637,620
Other investments	1,743,259	1,248,439
Total investments	39,847,542	33,371,283
Cash and cash equivalents	2,840,841	2,521,814
Restricted cash	135,638	0
Accrued investment income	312,856	315,964
Deferred acquisition costs and value of business acquired	1,121,362	354,533
Ceded unearned premiums	2,433,462	952,525
Premiums receivable	5,933,368	2,473,736
Reinsurance balances receivable	371,807	131,519
Unpaid losses and loss expenses recoverable	5,155,612	3,429,368
Receivable from investments sold	118,415	92,762
Goodwill and other intangible assets	2,205,911	447,952
Deferred tax asset	204,155	204,491
Other assets	1,069,737	750,872
Total assets	61,750,706	45,046,819
Liabilities:
Unpaid losses and loss expenses	25,840,381	19,353,243
Deposit liabilities	1,212,206	1,245,367
Future policy benefit reserves	4,494,886	4,707,199
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable: 2015, $4,054,705; 2014, $4,265,678)	915,116	1,155,016
Unearned premiums	8,548,841	3,973,132
Notes payable and debt	2,726,455	1,662,580
Reinsurance balances payable	2,494,201	493,230
Payable for investments purchased	149,249	42,291
Deferred tax liability	144,044	66,246
Other liabilities	1,020,222	912,749
Total liabilities	$ 47,545,601	$ 33,611,053
Commitments and Contingencies
Shareholders' Equity:
Ordinary shares, 999,990,000 authorized, par value $0.01; issued and outstanding (2015, 303,891,887; 2014, 255,182,955)	$ 3,039	$ 2,552
Additional paid in capital	9,153,868	7,359,102
Accumulated other comprehensive income	1,076,174	1,484,458
Retained earnings	2,014,217	1,187,639
Shareholders' equity attributable to XL Group plc	12,247,298	10,033,751
Non-controlling interest in equity of consolidated subsidiaries	1,957,807	1,402,015
Total shareholders' equity	14,205,105	11,435,766
Total liabilities and shareholders' equity	$ 61,750,706	$ 45,046,819

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Fair Value Measurements - Additional information about assets and liabilities measured at fair value on a recurring basis (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Derivative contracts - net
Level 3 liabilities
Balance, beginning of period		$ (9,606)	$ (32,496)	$ (9,764)	$ (29,110)
Realized gains (losses)		0	0	0	0
Movement in unrealized gains (losses)		(147)	13,586	11	10,200
Purchases and issuances	[1]	0	0	0	0
Sales			0	0	0
Settlements		0	0	0	0
Transfers into Level 3		0	0	0	0
Transfers out of Level 3		0	0	0	0
Balance, end of period		(9,753)	(18,910)	(9,753)	(18,910)
Movement in total gains (losses) above relating to instruments still held at the reporting date		(147)	13,586	11	10,200
RMBS - Agency
Level 3 assets
Balance, beginning of period		1,820	8,928	1,910	10,473
Realized gains (losses)		0	6	0	6
Movement in unrealized gains (losses)		(1)	(13)	(2)	(13)
Purchases and issuances	[1]	1,297	0	1,297	0
Sales		0	0	0	0
Settlements		(78)	(2,025)	(167)	(2,598)
Transfers into Level 3		0	0	0	0
Transfers out of Level 3		0	0	0	(972)
Fixed maturities to short-term investments classification change		0	0	0	0
Balance, end of period		3,038	6,896	3,038	6,896
Movement in total gains (losses) above relating to instruments still held at the reporting date		(1)	(6)	0	(6)
RMBS - Non-Agency
Level 3 assets
Balance, beginning of period		0	11	0	9
Realized gains (losses)		0	0	0	0
Movement in unrealized gains (losses)		0	0	0	2
Purchases and issuances	[1]	0	0	0	0
Sales		0	0	0	0
Settlements		0	0	0	0
Transfers into Level 3		0	0	0	0
Transfers out of Level 3		0	0	0	0
Fixed maturities to short-term investments classification change		0	0	0	0
Balance, end of period		0	11	0	11
Movement in total gains (losses) above relating to instruments still held at the reporting date		0	0	0	0
Commercial mortgage-backed securities
Level 3 assets
Balance, beginning of period		0	5,926	0	12,533
Realized gains (losses)		0	2	0	3
Movement in unrealized gains (losses)		0	(1)	0	(3)
Purchases and issuances	[1]	0	1,376	0	1,376
Sales		0	0	0	0
Settlements		0	(5,358)	0	(11,964)
Transfers into Level 3		0	0	0	0
Transfers out of Level 3		0	0	0	0
Fixed maturities to short-term investments classification change		0	0	0	0
Balance, end of period		0	1,945	0	1,945
Movement in total gains (losses) above relating to instruments still held at the reporting date		0	0	0	0
Collateralized debt obligations
Level 3 assets
Balance, beginning of period		496,923	718,827	687,958	710,253
Realized gains (losses)		224	875	260	2,456
Movement in unrealized gains (losses)		2,445	8,331	8,000	12,013
Purchases and issuances	[1]	11,941	75,201	11,941	103,015
Sales		0	(30,892)	(155,085)	(40,824)
Settlements		(27,362)	(39,518)	(68,903)	(54,089)
Transfers into Level 3		0	0	0	0
Transfers out of Level 3		0	0	0	0
Fixed maturities to short-term investments classification change		0	0	0	0
Balance, end of period		484,171	732,824	484,171	732,824
Movement in total gains (losses) above relating to instruments still held at the reporting date		2,057	8,247	4,725	13,216
Other asset-backed securities
Level 3 assets
Balance, beginning of period		2,244	10,673	5,288	11,877
Realized gains (losses)		92	(5)	91	(20)
Movement in unrealized gains (losses)		8	144	10	206
Purchases and issuances	[1]	$ 40,628	3,000	40,628	3,000
Sales			0	0	0
Settlements		$ (227)	(2,108)	(3,272)	(3,359)
Transfers into Level 3		0	0	0	0
Transfers out of Level 3		0	0	0	0
Fixed maturities to short-term investments classification change		0	0	0	0
Balance, end of period		42,745	11,704	42,745	11,704
Movement in total gains (losses) above relating to instruments still held at the reporting date		100	140	100	186
Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported
Level 3 assets
Balance, beginning of period		0	0	0	0
Realized gains (losses)		0	0	0	0
Movement in unrealized gains (losses)		0	0	0	0
Purchases and issuances	[1]	0	0	0	0
Sales		0	0	0	0
Settlements		0	0	0	0
Transfers into Level 3		0	0	0	0
Transfers out of Level 3		0	0	0	0
Fixed maturities to short-term investments classification change		0	0	0	0
Balance, end of period		0	0	0	0
Movement in total gains (losses) above relating to instruments still held at the reporting date		0	0	0	0
Short-term investments
Level 3 assets
Balance, beginning of period		0	0	0	2,015
Realized gains (losses)		0	0	0	0
Movement in unrealized gains (losses)		0	0	0	(15)
Purchases and issuances	[1]	0	0	0	0
Sales		0	0	0	0
Settlements		0	0	0	(2,000)
Transfers into Level 3		0	0	0	0
Transfers out of Level 3		0	0	0	0
Fixed maturities to short-term investments classification change		0	0	0	0
Balance, end of period		0	0	0	0
Movement in total gains (losses) above relating to instruments still held at the reporting date		0	0	0	0
Other investments
Level 3 assets
Balance, beginning of period		190,097	116,418	185,083	113,472
Realized gains (losses)		1,291	5,127	2,593	8,691
Movement in unrealized gains (losses)		(139)	(1,779)	(1,966)	(282)
Purchases and issuances	[1]	$ 66,510	9,997	73,303	21,086
Sales			0	0	0
Settlements		$ (2,087)	(5,288)	(3,341)	(18,492)
Transfers into Level 3		0	0	0	0
Transfers out of Level 3		0	0	0	0
Fixed maturities to short-term investments classification change		0	0	0	0
Balance, end of period		255,672	124,475	255,672	124,475
Movement in total gains (losses) above relating to instruments still held at the reporting date		1,152	3,348	628	8,409
Financial Services Sector [Member] | Corporate
Level 3 assets
Balance, beginning of period		0	0	0	0
Realized gains (losses)		0	0	0	0
Movement in unrealized gains (losses)		0	0	0	0
Purchases and issuances	[1]	10,000	0	10,000	0
Sales		0	0	0	0
Settlements		$ 0	0	0	0
Transfers into Level 3			0	0	0
Transfers out of Level 3		$ 0	0	0	0
Fixed maturities to short-term investments classification change		0	0	0	0
Balance, end of period		10,000	0	10,000	0
Movement in total gains (losses) above relating to instruments still held at the reporting date		0	0	0	0
Non-Financial Services Sector [Member] | Corporate
Level 3 assets
Balance, beginning of period		5,861	4,382	5,894	31,573
Realized gains (losses)		(140)	35	(141)	155
Movement in unrealized gains (losses)		(44)	(93)	4	(96)
Purchases and issuances	[1]	(123)	8	(123)	1,443
Sales		0	0	0	0
Settlements		$ 0	(399)	(80)	(5,513)
Transfers into Level 3			0	0	0
Transfers out of Level 3		$ 0	0	0	(23,629)
Fixed maturities to short-term investments classification change		0	0	0	0
Balance, end of period		5,554	3,933	5,554	3,933
Movement in total gains (losses) above relating to instruments still held at the reporting date		$ (184)	$ (58)	$ (136)	$ 90

[1] Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

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UNAUDITED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Excluding Life Funds Withheld Assets	Life Funds Withheld Assets	Ordinary Shares	Additional Paid in Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Other Comprehensive Income (Loss) Excluding Life Funds Withheld Assets	Accumulated Other Comprehensive Income (Loss) Life Funds Withheld Assets	Retained Earnings (Deficit)	Non-controlling Interest in Equity of Consolidated Subsidiaries
Balance, beginning of year at Dec. 31, 2013				$ 2,783	$ 7,994,100	$ 736,657			$ 1,264,093	$ 1,351,665
Issuance of ordinary shares				11	14
Buybacks of ordinary shares				(113)	(323,455)				(28,085)
Exercise of stock options				2
Exercise of stock options					3,055
Share-based compensation expense					26,663				0
Change in net unrealized gains (losses) on investments, net of tax		$ 502,080	$ 12,297				$ 502,080	$ 12,297
Unrealized gains on held to maturity investment portfolio at time of transfer to available for sale, net of tax	$ 424,861					424,861
Change in adjustments related to future policy benefit reserves, net of tax	(474,465)					(474,465)
Change in net unrealized gains (losses) on affiliate and other investments, net of tax	13,973					13,973
Change in OTTI losses recognized in other comprehensive income, net of tax	4,932					4,932
Change in underfunded pension liability, net of tax	(39)					(39)
Change in value of cash flow hedge	220					220
Foreign currency translation adjustments, net of tax	(13,482)					(13,482)
Net income (loss) attributable to ordinary shareholders	(23,543)								(23,543)
Dividends on ordinary shares									(88,270)
Non-controlling interests - contributions										21,494
Non-controlling interests - distributions										0
Non-controlling interests - acquired										0
Non-controlling interests										1,129
Balance, end of year at Jun. 30, 2014	11,408,577			2,683	7,700,377	1,207,034			1,124,195	1,374,288
Balance, beginning of year at Dec. 31, 2014	11,435,766			2,552	7,359,102	1,484,458			1,187,639	1,402,015
Issuance of ordinary shares				515	1,851,705
Buybacks of ordinary shares				(30)	(85,796)				(26,559)
Exercise of stock options				2
Exercise of stock options					4,826
Share-based compensation expense					24,031				(7,050)
Change in net unrealized gains (losses) on investments, net of tax		$ (258,590)	$ (283,931)				$ (258,590)	$ (283,931)
Unrealized gains on held to maturity investment portfolio at time of transfer to available for sale, net of tax	0					0
Change in adjustments related to future policy benefit reserves, net of tax	86,684					86,684
Change in net unrealized gains (losses) on affiliate and other investments, net of tax	34,687					34,687
Change in OTTI losses recognized in other comprehensive income, net of tax	11,433					11,433
Change in underfunded pension liability, net of tax	(354)					(354)
Change in value of cash flow hedge	107					107
Foreign currency translation adjustments, net of tax	1,680					1,680
Net income (loss) attributable to ordinary shareholders	951,320								951,320
Dividends on ordinary shares									(91,133)
Non-controlling interests - contributions										4,659
Non-controlling interests - distributions										(15,026)
Non-controlling interests - acquired										562,285
Non-controlling interests										3,874
Balance, end of year at Jun. 30, 2015	$ 14,205,105			$ 3,039	$ 9,153,868	$ 1,076,174			$ 2,014,217	$ 1,957,807

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Derivative Instruments - Derivatives Designated As Fair Value Hedges (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) recognized in income from ineffective portion of fair value hedges	$ 0	$ (2,050)	$ 0	$ (256)
Derivatives designated as hedging instruments | Fair value hedges | Net realized and unrealized gains (losses) on derivative instruments
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) recognized in income	0	(9,132)	0	(15,663)
Amount of gain (loss) recognized in income from ineffective portion of fair value hedges	0	(2,050)	0	(256)
Derivatives designated as hedging instruments | Fair value hedges | Net realized and unrealized gains (losses) on derivative instruments | Interest rate contracts
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) recognized in income	0	0	0	0
Derivatives designated as hedging instruments | Fair value hedges | Net realized and unrealized gains (losses) on derivative instruments | Foreign exchange contracts
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) recognized in income	0	(9,132)	0	(15,663)
Derivatives designated as hedging instruments | Fair value hedges | Net realized and unrealized gains (losses) on derivative instruments | Fixed maturity investments
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) recognized in income	$ 0	$ 7,082	$ 0	$ 15,407

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Acquisition and Disposals - Acquisition consideration (Details) - May. 01, 2015 £ / shares in Units, $ / shares in Units, £ in Thousands, $ in Thousands		USD ($) shares $ / shares	GBP (£) shares £ / shares
Business Acquisition [Line Items]
Closing price per XL share on April 30, 2015 | $ / shares	[1]	$ 37.08
Catlin Group Limited
Business Acquisition [Line Items]
Shares outstanding (including dilutive effects of warrants) that will receive cash and share consideration		384,118,000
Exchange ratio per the merger agreement		0.13	0.13
Share issuance to Catlin shareholders		49,935,000	49,935,000
Share issuance consideration | $		$ 1,851,601
Cash price component, per share in GBP | £ / shares			£ 3.88
Foreign exchange rate: GBP/USD		1.5349
Cash consideration		$ 2,287,579	£ 1,490,377
Total acquisition consideration | $		$ 4,139,180

[1] The closing market price of XL Shares on the Acquisition Date represents the fair value of XL shares issued as part of the Acquisition Consideration.

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Derivative Instruments - Narrative (Details) - USD ($) $ in Thousands		3 Months Ended				6 Months Ended
		Jun. 30, 2015		Jun. 30, 2014		Jun. 30, 2015		Jun. 30, 2014		Dec. 31, 2014
Derivative [Line Items]
Cumulative net realized and unrealized loss on life retrocession embedded derivative		$ (381,300)				$ (381,300)
Gross amounts recognized in balance sheet		228,475				228,475				$ 136,659
Net realized and unrealized gains (losses) on derivative instruments		48,509		$ 11,599		65,030		$ 13,409
Gross amounts not offset in the balance sheet - cash collateral		132,050				132,050				78,580
Net results from structured products		5,257	[1]	34,885	[2]	10,282	[3]	42,838	[4]
Fair value hedges | Deposit liabilities
Derivative [Line Items]
Remaining balance		134,054		$ 142,580		134,054		$ 142,580
Structured indemnity | Fair value hedges | Deposit liabilities
Derivative [Line Items]
Remaining balance		47,000				47,000
Structured indemnity | Interest expense
Derivative [Line Items]
Net results from structured products		28,700
Derivatives not designated as hedging instruments
Derivative [Line Items]
Asset derivative notional amount		599,833				599,833				592,791
Gross amounts recognized in balance sheet	[5]	18,800				18,800				14,797
Other non-investment derivatives | Derivatives not designated as hedging instruments | Other credit derivatives
Derivative [Line Items]
Asset derivative notional amount		30,281				30,281				31,060
Gross amounts recognized in balance sheet		71				$ 71				$ 60
Net realized and unrealized gains (losses) on derivative instruments		$ 100

[1] The net results from P&C structured products include net investment income and interest expense of $16.0 million and $10.6 million, respectively.

[2] The net results from P&C structured products include net investment income and interest credit of $16.9 million and $18.2 million, respectively.

[3] The net results from P&C structured products include net investment income and interest expense of $31.1 million and $20.6 million, respectively.

[4] The net results from P&C structured products include net investment income and interest credit of $35.7 million and $7.4 million, respectively.

[5] Derivative instruments in an asset or liability position are included within Other assets or Other liabilities, respectively, in the balance sheets on a net basis where the Company has both a legal right of offset and the intention to settle the contracts on a net basis.

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Accumulated Other Comprehensive Income (Loss)

6 Months Ended

Jun. 30, 2015

Comprehensive Income Loss Note [Abstract]

Accumulated Other Comprehensive Income (Loss)

Accumulated Other Comprehensive Income (Loss)

The changes in AOCI, net of tax, by component for the three and six months ended June 30, 2015 and 2014 are as follows:

Three months ended June 30, 2015 (U.S. dollars in thousands)	Unrealized Gains (Losses) on Investments (1)			OTTI Losses Recognized in AOCI			Foreign Currency Translation Adjustments			Underfunded Pension Liability			Cash Flow Hedge		Total
Balance, beginning of period, net of tax	$	1,763,795		$	(66,189	)	$	24,915		$	(19,814	)	$	2,463	$	1,705,170
OCI before reclassifications	(544,273		)	—			(36,362		)	(1,329		)	—		(581,964		)
Amounts reclassified from AOCI	(87,558		)	1,662			—			—			12		(85,884		)
Tax benefit (expense)	37,000			(87		)	1,939			—			—		38,852
Net current period OCI - net of tax	(594,831		)	1,575			(34,423		)	(1,329		)	12		(628,996		)
Balance, end of period, net of tax	$	1,168,964		$	(64,614	)	$	(9,508	)	$	(21,143	)	$	2,475	$	1,076,174
Three months ended June 30, 2014 (U.S. dollars in thousands)
Balance, beginning of period, net of tax	$	1,032,941		$	(85,894	)	$	10,661		$	(13,270	)	$	2,223	$	946,661
OCI before reclassifications	363,348			—			(3,621		)	(8		)	—		359,719
Amounts reclassified from AOCI	(74,337		)	1,640			—			—			110		(72,587		)
Tax benefit (expense)	(20,774		)	(4		)	(5,981		)	—			—		(26,759		)
Net current period OCI - net of tax	268,237			1,636			(9,602		)	(8		)	110		260,373
Balance, end of period, net of tax	$	1,301,178		$	(84,258	)	$	1,059		$	(13,278	)	$	2,333	$	1,207,034
Six months ended June 30, 2015 (U.S. dollars in thousands)
Balance, beginning of period, net of tax	$	1,590,114		$	(76,047	)	$	(11,188	)	$	(20,789	)	$	2,368	$	1,484,458
OCI before reclassifications	(290,007		)	—			(3,958		)	(354		)	—		(294,319		)
Amounts reclassified from AOCI	(162,338		)	11,598			—			—			107		(150,633		)
Tax benefit (expense)	31,195			(165		)	5,638			—			—		36,668
Net current period OCI - net of tax	(421,150		)	11,433			1,680			(354		)	107		(408,284		)
Balance, end of period, net of tax	$	1,168,964		$	(64,614	)	$	(9,508	)	$	(21,143	)	$	2,475	$	1,076,174
Six months ended June 30, 2014 (U.S. dollars in thousands)
Balance, beginning of period, net of tax	$	822,432		$	(89,190	)	$	14,541		$	(13,239	)	$	2,113	$	736,657
OCI before reclassifications	628,599			—			(9,521		)	(39		)	—		619,039
Amounts reclassified from AOCI	(96,975		)	5,049			—			—			220		(91,706		)
Tax benefit (expense)	(52,878		)	(117		)	(3,961		)	—			—		(56,956		)
Net current period OCI - net of tax	478,746			4,932			(13,482		)	(39		)	220		470,377
Balance, end of period, net of tax	$	1,301,178		$	(84,258	)	$	1,059		$	(13,278	)	$	2,333	$	1,207,034

____________

(1) Included in these amounts is the impact of Shadow Adjustments. As of December 31, 2014 the cumulative impact of the Shadow Adjustments was $445.1 million. During the six months ended June 30, 2015, net movements of $(86.7) million were recorded, resulting in a total cumulative net impact of Shadow Adjustments on future policy benefit reserves of $358.4 million as of June 30, 2015.

The reclassifications out of AOCI along with the associated income statement line items affected by component, and the total related tax (expense) benefit for the three and six months ended June 30, 2015 and 2014 are as follows:

Gross Amount Reclassified From AOCI
Details About AOCI Components (U.S. dollars in thousands)	Three months ended June 30, 2015			Three months ended June 30, 2014			Six months ended June 30, 2015			Six months ended June 30, 2014			Affected Line Item in the Statement of Income
Unrealized gains and losses on investments:
	$	(71,027	)	$	(107,470	)	$	(149,578	)	$	(132,384	)	Net realized gains (losses) on investments sold and net unrealized gains (losses) on investments Trading
	19,398			33,133			35,122			35,409			OTTI on investments
	$	(35,929	)	$	—		$	(47,882	)	$	—		Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets
	$	(87,558	)	$	(74,337	)	$	(162,338	)	$	(96,975	)	Total before tax
	3,694			3,699			3,781			4,152			Provision (benefit) for income tax
	$	(83,864	)	$	(70,638	)	$	(158,557	)	$	(92,823	)	Net of tax
OTTI losses recognized in OCI:
	$	1,594		$	1,386		$	11,469		$	3,344		Net realized gains (losses) on investments sold
	68			254			129			1,705			OTTI on investments transferred to (from) OCI
	$	1,662		$	1,640		$	11,598		$	5,049		Total before tax
	(12		)	(4		)	(15		)	(117		)	Provision (benefit) for income tax
	$	1,650		$	1,636		$	11,583		$	4,932		Net of tax
Gains and losses on cash flow hedges:
Interest rate contracts	$	12		$	110		$	107		$	220		Interest Expense
	—			—			—			—			Provision (benefit) for income tax
	$	12		$	110		$	107		$	220		Net of tax
Total reclassifications for the period, gross of tax	$	(85,884	)	$	(72,587	)	$	(150,633	)	$	(91,706	)
Tax benefit (expense)	3,682			3,695			3,766			4,035
Total reclassifications for the period, net of tax	$	(82,202	)	$	(68,892	)	$	(146,867	)	$	(87,671	)

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Acquisition and Disposals - Acquisition narrative (Details) £ / shares in Units, $ / shares in Units, £ in Thousands, $ in Thousands			6 Months Ended
	May. 01, 2015 USD ($) shares $ / shares	May. 01, 2015 GBP (£) shares £ / shares	Jun. 30, 2015 USD ($) $ / shares	Mar. 30, 2015 USD ($)	Jan. 08, 2015 GBP (£)	Dec. 31, 2014 USD ($) $ / shares
Business Acquisition [Line Items]
Ordinary shares, par value (in dollars per share) | $ / shares			$ 0.01			$ 0.01
Goodwill			$ 1,190,230			$ 415,936
Face amount of issued debt			2,763,142			$ 1,675,000
Goodwill acquired during the period			778,043
Indefinite-lived intangible assets acquired during the period			673,000
Finite-lived intangible assets acquired during the period			315,000
Intangibles Assets Arising from Insurance Contracts Acquired in Business Combination, Amortization Expense			$ 183,300
Catlin Group Limited
Business Acquisition [Line Items]
Ordinary shares, par value (in dollars per share) | $ / shares	$ 0.01
Cash price component, per share in GBP | £ / shares		£ 3.88
Exchange ratio per the merger agreement | shares	0.13	0.13
Share issuance to Catlin shareholders | shares	49,935,000	49,935,000
Cash consideration	$ 2,287,579	£ 1,490,377
Face amount of issued debt				$ 1,000,000
Goodwill acquired during the period	778,043
Indefinite-lived intangible assets acquired during the period	673,000
Finite-lived intangible assets acquired during the period	315,000
VOBA, amortization period			2 years
Adjustment to reserves, amortization period			20 years
Deferred tax liability	94,071
Acquisition related costs			$ 61,800
Business Combination Measurement Period			12 months
Catlin Group Limited | Operating expense
Business Acquisition [Line Items]
Acquisition related costs			$ 47,300
Catlin Group Limited | Interest expense
Business Acquisition [Line Items]
Acquisition related costs			$ 14,500
Catlin Group Limited | Net deferred tax liability excluding valuation allowance
Business Acquisition [Line Items]
Deferred tax liability	22,100
Catlin Group Limited | Valuation allowance
Business Acquisition [Line Items]
Deferred tax liability	72,000
Catlin Group Limited | Intangible assets
Business Acquisition [Line Items]
Deferred tax liability	133,800
Catlin Group Limited | Loss carryforwards
Business Acquisition [Line Items]
Deferred tax liability	17,400
Catlin Group Limited | Unpaid losses and loss adjustment expenses, deferred acquisition costs and VOBA
Business Acquisition [Line Items]
Deferred tax liability	8,800
Catlin Group Limited | Other temporary differences
Business Acquisition [Line Items]
Deferred tax liability	500
Catlin Group Limited | Fixed assets
Business Acquisition [Line Items]
Deferred tax liability	13,000
Catlin Group Limited | Cash on hand
Business Acquisition [Line Items]
Cash consideration	1,310,000
Catlin Group Limited | Proceeds from debt issuance
Business Acquisition [Line Items]
Cash consideration	$ 980,600
Catlin Group Limited | XL Cayman
Business Acquisition [Line Items]
Available letter of credit facilities - commitments | £					£ 1,600,000

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Acquisition and Disposals (Tables)

6 Months Ended

Jun. 30, 2015

Acquisition and Disposal [Abstract]

Acquisition consideration

The calculation of the consideration transferred to acquire Catlin Shares is as follows:

(In thousands, except per share data)
Catlin Shares outstanding as of April 30, 2015 that received share consideration (including the dilutive effect of warrants)	384,118
Exchange ratio per the implementation agreement	0.130
XL Share issuance to Catlin shareholders	49,935
Closing price per XL share on April 30, 2015 (1)	$	37.08
XL Share issuance consideration	$	1,851,601
Catlin Shares outstanding as of April 30, 2015 that received cash consideration (including the dilutive effect of warrants)	384,118
Cash price component, per Catlin Share in GBP	£	3.88
Cash consideration, in GBP	£	1,490,377
Foreign exchange rate: GBP/USD on April 30, 2015	$	1.5349
Cash consideration	$	2,287,579
Total acquisition consideration	$	4,139,180

____________

(1) The closing market price of XL Shares on the Acquisition Date represents the fair value of XL shares issued as part of the Acquisition Consideration.

Fair value of net assets acquired and liabilities assumed

The following table summarizes the fair values of the assets acquired and liabilities assumed at the Acquisition Date:

(U.S. dollars in thousands)
ASSETS
Fixed maturities, at fair value	$	6,266,489
Short-term investments, at fair value	634,599
Equity investments, at fair value	236,230
Investment in affiliates	216,843
Other investments	386,828
Total investments	$	7,740,989
Cash and cash equivalents (1)	1,267,565
Accrued investment income	35,063
Premiums receivable	2,545,188
Unpaid losses and loss expenses recoverable	1,493,267
Reinsurance balances receivable	299,579
Ceded unearned premiums	1,143,852
Deferred acquisition costs and value of business acquired	679,259
Intangible assets	988,000
Receivable from investments sold	9,633
Other assets	314,168
Total assets	$	16,516,563
LIABILITIES
Unpaid losses and loss expenses	$	6,933,144
Unearned premiums	3,742,234
Reinsurance balances payable	1,441,749
Notes payable and debt	82,066
Payable for investments purchased	34,149
Deferred tax liability	94,071
Other liabilities	265,728
Total liabilities	$	12,593,141
Net assets acquired before non-controlling interest	$	3,923,422
Non-controlling interest in equity of consolidated subsidiaries	562,285
Net assets acquired	$	3,361,137
Acquisition Consideration	$	4,139,180
Goodwill	$	778,043

Transaction related costs

As a part of the ongoing integration of Catlin's operations, the Company incurs costs associated with restructuring the systems, processes and workforce. These costs include such items as severance, retention, facilities and consulting and other costs. The Company separately identifies such costs and includes these expenses within Corporate and Other:

(U.S. dollars in thousands)	Severance costs		Retention costs		Facilities-related costs		Consulting and other
Costs incurred in 2015	$	12,274	$	365	$	1,530	$	13,676
2015 payments	1,639		—		462		4,573
Liabilities at June 30, 2015	$	10,635	$	365	$	1,068	$	9,103

Financial results

The following table summarizes the results of the acquired Catlin operations since the Acquisition Date that have been included within the Company's consolidated statements of income and comprehensive income.

(U.S. dollars in thousands)	May 1, 2015 to June 30, 2015
Total revenues	$	709,800
Net income (loss) attributable to ordinary shareholders	$	50,017

Supplemental pro forma information

	Unaudited Pro Forma
	Six Months Ended June 30,
(In thousands, except per share data)	2015		2014
Total revenues	$	5,427,900	$	5,736,519
Net income attributable to ordinary shareholders	960,951		107,279
Earnings (loss) per ordinary share and ordinary share equivalent – basic	3.14		0.33
Earnings (loss) per ordinary share and ordinary share equivalent – diluted	3.09		0.33

Impact of Life Retro Arrangements

The impact of the Life Retro Arrangements on the Company's results was as follows:

Impact of Life Retro Arrangements	Three months ended June 30,						Six Months Ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Underwriting profit (loss) (1)	$	—		$	—		$	603		$	—
Net investment income - Life Funds Withheld Assets	46,864			19,165			97,283			19,165
Net realized gains (losses) on investments sold - Life Funds Withheld Assets	68,037			624			120,775			624
Net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets	(19,543		)	—			(18,783		)	—
OTTI on investments - Life Funds Withheld Assets	(2,878		)	(8,771		)	(8,087		)	(8,771		)
Exchange gains (losses)	(18,370		)	—			(14,686		)	—
Other income and expenses	3,773			(19		)	2,475			(19		)
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	239,174			(17,546		)	9,807			(17,546		)
Net income (loss)	$	317,057		$	(6,547	)	$	189,387		$	(6,547	)
Change in net unrealized gains (losses) on investments - Life Funds Withheld Assets, net of tax	(321,046		)	12,297			(283,931		)	12,297
Change in adjustments related to future policy benefit reserves, net of tax	26,328			—			86,684			—
Change in cumulative translation adjustment - Life Funds Withheld Assets, net of tax	(22,339		)	(5,750		)	8,463			(5,750		)
Total changes to other comprehensive income as a result of Life Retro Arrangements	$	(317,057	)	$	6,547		$	(188,784	)	$	6,547
Comprehensive income (loss)	$	—		$	—		$	603		$	—

____________

(1) The underwriting profit of $0.6 million relates to a premium adjustment during the six months ended June 30, 2015 relating to the Life Retro Arrangements transaction. Excluding this transaction, the impact to comprehensive income relating to the Life Retro Arrangements was nil for the three and six months ended June 30, 2015.

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Share Capital - Summary of ordinary shares issued and outstanding (Details) - shares		6 Months Ended
		Jun. 30, 2015	Jun. 30, 2014
Summary of ordinary shares issued and outstanding:
Balance, issued, beginning of period (in shares)		255,182,955	278,253,000
Balance, outstanding, beginning of period (in shares)		255,182,955	278,253,000
Exercise of options (in shares)		220,000	424,000
Net issuance of restricted shares (in shares)		1,536,000	1,246,000
Share buybacks (in shares)	[1]	(2,982,000)	(24,740,000)
Issue of shares (in shares)		49,935,000	0
Balance, outstanding, end of period (in shares)		303,891,887
Balance, issued, end of period (in shares)		303,891,887

[1] Includes share buybacks associated with authorized share buyback programs as well as purchases related to satisfying tax withholding obligations of employees in connection with the vesting of restricted shares granted under the Company's equity compensation programs.

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UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Cash flows provided by (used in) operating activities:
Net income (loss)	$ 993,589	$ 15,898
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Total net realized (gains) losses on investments and net unrealized (gains) losses on investments, Trading - Life Funds Withheld Assets	(102,858)	(91,926)
Net realized and unrealized (gains) losses on derivative instruments	(65,030)	(13,409)
Amortization of premiums (discounts) on fixed maturities	77,334	76,846
(Income) loss from investment and operating affiliates	(78,257)	(68,292)
Loss on sale of life reinsurance subsidiary	0	666,423
Gain on sale of ARX Holding Corp.	(340,407)	0
Share-based compensation	39,641	40,563
Depreciation	29,349	29,107
Accretion of deposit liabilities	20,887	(7,762)
Changes in:
Unpaid losses and loss expenses	(166,007)	(264,804)
Future policy benefit reserves	(122,842)	(93,202)
Funds withheld on life retrocession agreements, net	(156,411)	(52,104)
Unearned premiums	868,244	848,937
Premiums receivable	(959,771)	(792,588)
Unpaid losses and loss expenses recoverable	(255,432)	136,758
Ceded unearned premiums	(343,391)	(338,855)
Reinsurance balances receivable	56,825	(28,270)
Deferred acquisition costs	(105,402)	216,453
Reinsurance balances payable	565,221	420,902
Deferred tax asset - net	30,284	(51,571)
Derivatives	109,745	(45,306)
Other assets	(63,360)	(15,478)
Other liabilities	(59,258)	(286,737)
Other	57,618	34,500
Total adjustments	(973,085)	337,731
Net cash provided by (used in) operating activities	20,504	353,629
Cash flows provided by (used in) investing activities:
Proceeds from sale of fixed maturities and short-term investments	6,352,126	3,043,659
Proceeds from redemption of fixed maturities and short-term investments	1,938,622	1,837,319
Proceeds from sale of equity securities	271,367	295,448
Purchases of fixed maturities and short term investments	(8,042,196)	(3,801,109)
Purchases of equity securities	(239,535)	(239,680)
Proceeds from sale of affiliates	86,156	156,481
Purchases of affiliates	(33,298)	(196,487)
Purchase of Catlin Group Limited, net of cash acquired	(1,020,015)	0
Proceeds from sale of life reinsurance subsidiary	0	570,000
Proceeds from sale of ARX Holding Corp.	560,552	0
Change in restricted cash	(135,638)	0
Other, net	(87,516)	(96,222)
Net cash provided by (used in) investing activities	(349,375)	1,569,409
Cash flows provided by (used in) financing activities:
Proceeds from issuance of ordinary shares and exercise of stock options	4,827	3,057
Buybacks of ordinary shares	(112,385)	(351,654)
Dividends paid on ordinary shares	(89,053)	(87,056)
Distributions to non-controlling interests	(53,456)	(38,502)
Contributions from non-controlling interests	4,658	21,494
Proceeds from the issuance of debt	980,600	0
Deposit liabilities	(49,388)	(213,869)
Net cash provided by (used in) financing activities	685,803	(666,530)
Effects of exchange rate changes on foreign currency cash	(37,905)	13,799
Increase (decrease) in cash and cash equivalents	319,027	1,270,307
Cash and cash equivalents beginning of year	2,521,814	1,800,832
Cash and cash equivalents end of year	2,840,841	3,071,139
Life Funds Withheld Assets
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Net realized and unrealized (gains) losses on derivative instruments	$ (9,807)	$ 17,546

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UNAUDITED CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Amortized cost of fixed maturities, available for sale	$ 32,699,709	$ 27,728,771
Cost of equity securities	964,038	763,833
Amortized cost of short-term investments, available for sale	806,990	257,221
Amortized cost of fixed maturities, trading	768,492	1,180
Amortized cost of short-term investments, trading	42,557	0
Future policy benefit reserves recoverable	$ 4,054,705	$ 4,265,678
Ordinary shares, shares authorized (in shares)	999,990,000	999,990,000
Ordinary shares, par value (in dollars per share)	$ 0.01	$ 0.01
Ordinary shares, shares issued (in shares)	303,891,887	255,182,955
Ordinary shares, shares outstanding (in shares)	303,891,887	255,182,955

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Notes Payable and Debt and Financing Arrangements

6 Months Ended

Jun. 30, 2015

Debt Disclosure [Abstract]

Notes Payable and Debt and Financing Arrangements

Notes Payable and Debt and Financing Arrangements

As of June 30, 2015, the Company's financing structure, which includes senior and subordinated notes, and bank and loan facilities available from a variety of sources, including commercial banks, is as follows:

(U.S. dollars in thousands)	June 30, 2015				December 31, 2014
	Commitment/ Debt (1)		In Use/ Outstanding (2)		Commitment/ Debt (1)		In Use/ Outstanding (2)
Debt:
2.30% Senior Notes due 2018	300,000		297,679		300,000		297,344
5.75% Senior Notes due 2021	400,000		397,307		400,000		397,092
6.375% Senior Notes due 2024	350,000		348,975		350,000		348,920
4.45% Subordinated Notes due 2025	500,000		492,292		—		—
6.25% Senior Notes due 2027	325,000		323,140		325,000		323,062
Variable Rate Note, face amount €7m, due 2035	7,794		7,301		—		—
Variable Rate Note, face amount $27m, due 2036	27,000		25,259		—		—
Variable Rate Note, face amount $31m, due 2036	31,300		29,281		—		—
Variable Rate Note, face amount $10m, due 2036	9,800		9,168		—		—
Variable Rate Note, face amount €11m, due 2036	12,248		11,473		—		—
5.25% Senior Notes due 2043	300,000		296,228		300,000		296,162
5.5% Subordinated Notes due 2045	500,000		488,352		—		—
Total debt carrying value	$	2,763,142	$	2,726,455	$	1,675,000	$	1,662,580

_______________

(1) Excluded from the table are revolving credit facilities of $1.7 billion and $1.6 billion as of June 30, 2015 and December 31, 2014, respectively. As of June 30, 2015 and December 31, 2014, $667.9 million and $606.1 million, respectively, were utilized under these facilities to issue letters of credit, leaving $1.0 billion and $968.9 million, respectively, available for use under the revolving credit facilities.

(2)    "In Use" and "Outstanding" data represent June 30, 2015 and December 31, 2014 accreted values.

(a) Notes Payable and Debt

With the exception of the debt acquired as part of the Catlin Acquisition, as described below, all outstanding debt of the Company as of June 30, 2015 and December 31, 2014 was issued by XL-Cayman, a 100% owned subsidiary of XL-Ireland. XL-Ireland does not have significant assets or operations independent of XL-Cayman. XL-Cayman's outstanding debt is fully and unconditionally guaranteed by XL-Ireland. The ability of XL-Cayman, like that of the Company, to obtain funds from its subsidiaries to satisfy any of its obligations, including under guarantees, is subject to certain contractual restrictions, applicable laws and statutory requirements of the various countries in which the subsidiaries operate, including, among others, Bermuda, the United States, Ireland, Switzerland and the United Kingdom. For details of the required statutory capital and surplus for the principal operating subsidiaries of the Company, see Item 8, Note 25, "Statutory Financial Data," to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014.

On March 30, 2015, XL-Cayman issued $500 million of subordinated notes due March 2025, with a fixed coupon of 4.45%, that are guaranteed by XL-Ireland. The notes are listed on the New York Stock Exchange. The notes were issued at 99.633% of the face amount and net proceeds were $492.2 million. Related expenses of the offering amounted to approximately $5.9 million. These costs were deferred and will be amortized over the term of the subordinated notes.

On March 30, 2015, XL-Cayman issued $500 million of subordinated notes due March 2045, with a fixed coupon of 5.5%, that are guaranteed by XL-Ireland. The notes are listed on the New York Stock Exchange. The notes were issued at 99.115% of the face amount and net proceeds were $488.4 million. Related expenses of the offering amounted to approximately $7.2 million. These costs were deferred and will be amortized over the term of the subordinated notes.

As a result of the Catlin Acquisition, the Company has assumed the following liabilities of Catlin:

• Variable rate unsecured subordinated notes in the amounts of €7 million and $27 million due March 2035 and March 2036, respectively, issued by Catlin Underwriting (formerly Wellington Underwriting plc), in May 2006. The notes are subordinated to the claims of all senior creditors, as defined in the agreement governing the notes. The notes pay interest at a floating rate based on the rate on three-month deposits in U.S. dollars plus a margin of 295 basis points and 317 basis points, respectively. Interest is payable quarterly in arrears. The notes are redeemable at the discretion of the issuer.

• Variable rate unsecured subordinated notes in the amounts of $31 million, $10 million and €11 million due September 2036, issued by Catlin Underwriting, in July 2006. The notes are subordinated to the claims of all senior creditors, as defined in the agreement governing the notes. The notes pay interest at a floating rate based on the rate on three-month deposits in U.S. dollars plus a margin of 310 basis points, 300 basis points and 300 basis points, respectively. Interest is payable quarterly in arrears. The notes are redeemable at the discretion of the issuer.

XL-Cayman and the Company were in compliance with all covenants by significant margins as of June 30, 2015, and XL-Cayman and the Company currently remain in compliance with all covenants.

(b) Letter of Credit Facilities and Other Sources of Collateral

The Company has letter of credit facilities provided on both syndicated and bilateral bases from commercial banks. These facilities are utilized primarily to support non-admitted insurance and reinsurance operations in the U.S. and capital requirements at Lloyd’s.

The Company’s letter of credit facilities and revolving credit facilities as of June 30, 2015 and December 31, 2014 were as follows:

Letter of Credit Summary: (U.S. dollars in thousands except percentages)	June 30, 2015 (1)			December 31, 2014 (1)
Revolving credit facilities (2) (3)	$	1,032,100		$	968,900
Available letter of credit facilities - commitments (4)	$	4,855,000		$	3,575,000
Available letter of credit facilities - in use	$	2,585,348		$	1,790,561
Collateralized by certain assets of the Company’s investment portfolio	50.2		%	66.2		%

____________

(1) As of June 30, 2015 and December 31, 2014, there were eighteen and eight available letter of credit facilities, respectively.

(2) As of June 30, 2015 and December 31, 2014, $976.1 million and $968.9 million, respectively, of revolving credit was available under the Company's syndicated unsecured credit agreement, which currently provides for up to $1 billion of revolving credit loans. The Company has the option to increase the size of the facilities under the syndicated secured and unsecured credit agreements by an additional $500 million across both facilities. Two bilateral facilities assumed as a result of the Catlin Acquisition with commitments totaling $150.0 million also provide for revolving credit loans. As of June 30, 2015, $56.0 million of revolving credit was available to draw under these facilities.

(3) The credit agreements initially entered into with Citicorp USA, Inc. in May through November 2013 (the "Citi Agreements") provide for issuance of letters of credit and revolving credit loans up to an aggregate amount of $550.0 million, compared to $575.0 million as of December 31, 2014. As of June 30, 2015, $550.0 million of letters of credit were issued under these agreements, and therefore no amounts are included in this line as available to draw under this facility. The Company also has the option to increase the maximum amount of the letters of credit and revolving credit loans available under the Citi Agreements with the lender's and issuing lender's consent.

(4) The available letter of credit facilities include approximately $1 billion that is also included in the "revolving credit facilities" line in this table.

As a result of the Catlin Acquisition, the Company has assumed the following credit facilities:

• A $450 million unsecured multi-bank facility available for utilization by certain subsidiaries and guaranteed by Green Holdings. The facility has a termination date of December 31, 2016.

• A bilateral facility available for utilization by Catlin-Bermuda, collateralized by pledged financial assets. As of June 30, 2015, $147 million of letters of credit were issued under this facility.

• A bilateral facility available for utilization by Catlin Re Switzerland Ltd, collateralized by pledged financial assets. As of June 30, 2015, $49 million of letters of credit were issued under this facility.

• Four unsecured bilateral facilities available for utilization by Catlin-Bermuda and guaranteed by Green Holdings for Funds at Lloyd's purposes, amounting to a total of $375 million. One of the facilities has an expiration date of December 31, 2017, while the other three have expiration dates of December 31, 2018.

• An unsecured bilateral facility valued in Australian dollars at A$50 million, available for utilization by certain subsidiaries of Catlin and guaranteed by Green Holdings, for the purpose of providing collateral to Australian beneficiaries.

• Two unsecured bilateral revolving credit and letter of credit facilities, available for utilization by certain subsidiaries of Catlin and guaranteed by Green Holdings amounting to $150 million.

• A facility managed by Lloyd's, acting for Catlin Syndicate 2003. As of June 30, 2015, $8 million of letters of credit were issued under this facility.

• Catlin, Inc. has letters of credit amounting to $1 million issued for the benefit of various parties.

For details regarding these facilities see Item 8, Note 15(b), "Notes Payable and Debt and Financing Arrangements - Letter of Credit Facilities and Other Sources of Collateral," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

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Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Aug. 05, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	XL GROUP PLC
Entity Central Index Key	0000875159
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Jun. 30, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		302,314,373

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Related Party Transactions

6 Months Ended

Jun. 30, 2015

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

As of June 30, 2015 and 2014, the Company owned minority stakes in six and five independent investment management companies ("Investment Manager Affiliates"), respectively, that are actively managing client capital and seeking growth opportunities, respectively. The Company seeks to develop relationships with specialty investment management organizations, generally acquiring an equity interest in the business. The Company also invests in certain of the funds and limited partnerships and other legal entities managed by these affiliates, and, through these funds and partnerships, pays management and performance fees to the Company's Investment Manager Affiliates. See Item 8, Note 7, "Investments in Affiliates," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

In the normal course of business, the Company enters into assumed reinsurance contracts with certain of its other strategic affiliates, or their subsidiaries. Management believes that these transactions are conducted at market rates consistent with negotiated arm's-length contracts. During the three and six months ended June 30, 2015 and 2014, these contracts resulted in net premiums written, net claims incurred and acquisition costs as summarized below.

(U.S. dollars in thousands)	Three months ended June 30,				Six months ended June 30,
	2015		2014		2015		2014
Net premiums written	$	4,445	$	18,025	$	31,521	$	36,191
Net losses and loss expenses incurred	$	65	$	7,692	$	9,166	$	14,301
Acquisition costs	$	1,384	$	6,994	$	10,395	$	15,553

Results through April 1, 2015 include amounts under an assumed reinsurance contract with a wholly-owned subsidiary of ARX, an insurance operating affiliate of the Company to that date. The Company disposed of its investment in ARX on April 1, 2015, and thus, after that date, all amounts under this contract are no longer reported as related party transactions. See Note 3(b), "Acquisitions and Disposals - Sale of Strategic Operating Affiliate".

Commencing in 2014, several of the Company’s wholly-owned subsidiaries retrocede assumed reinsurance business to special purpose reinsurers that receive capital from funds managed by the Company's subsidiary, New Ocean Capital Management Limited, a Bermuda based company, ("New Ocean"), as discussed in Note 12, "Variable Interest Entities". Underwriting administration services are provided to the special purpose reinsurers by other subsidiaries of the Company under service fee agreements negotiated at arm's-length, while investment advisory services are provided by New Ocean.

During the three and six months endedJune 30, 2015, ceded premiums earned, ceded losses and loss expenses incurred, ceding commission income, and other fee income related to these retrocessional contracts were not material to the Company. Management believes that these transactions are conducted at market rates consistent with negotiated arm's-length contracts.

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UNAUDITED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Revenues:
Net premiums earned		$ 2,082,053	$ 1,496,594	$ 3,416,053	$ 2,985,433
Net investment income		223,204	232,773	431,717	465,962
Realized investment gains (losses):
Total net realized gains (losses) on investments, and net unrealized gains (losses) on investments Trading - Life Funds Withheld Assets		49,967	72,697	102,858	91,926
Net realized and unrealized gains (losses) on derivative instruments		48,509	11,599	65,030	13,409
Income (loss) from investment fund affiliates		31,377	17,683	66,706	50,986
Fee income and other		11,012	9,706	15,740	21,160
Total revenues		2,685,296	1,823,506	4,107,911	3,611,330
Expenses:
Net losses and loss expenses incurred		1,151,195	827,880	1,921,022	1,659,385
Claims and policy benefits		22,081	85,299	41,468	198,886
Acquisition costs	[1]	341,617	184,619	495,313	384,033
Operating expenses		507,354	333,029	833,010	643,453
Foreign exchange (gains) losses		10,374	21,141	37,764	31,582
Loss on sale of life reinsurance subsidiary		0	666,423	0	666,423
Interest expense		49,667	14,085	101,105	57,026
Total expenses		2,082,288	2,132,476	3,429,682	3,640,788
Income (loss) before income tax and income (loss) from operating affiliates		603,008	(308,970)	678,229	(29,458)
Income (loss) from operating affiliates		9,462	27,738	32,130	74,023
Gain on sale of operating affiliate		340,407	0	340,407	0
Provision (benefit) for income tax		32,959	(5,654)	57,177	28,667
Net income (loss)		919,918	(275,578)	993,589	15,898
Non-controlling interests		4,879	3,682	42,269	39,441
Net income (loss) attributable to ordinary shareholders		$ 915,039	$ (279,260)	$ 951,320	$ (23,543)
Weighted average ordinary shares outstanding - basic		289,420	270,924	272,665	273,616
Weighted average ordinary shares outstanding - diluted		293,983	270,924	277,473	273,616
Earnings (loss) per ordinary share and ordinary share equivalent - basic (in dollars per share)		$ 3.16	$ (1.03)	$ 3.49	$ (0.09)
Earnings (loss) per ordinary share and ordinary share equivalent - diluted (in dollars per share)		$ 3.11	$ (1.03)	$ 3.43	$ (0.09)
Excluding Life Funds Withheld Assets
Revenues:
Net investment income		$ 176,340	$ 213,608	$ 334,434	$ 446,797
Realized investment gains (losses):
Net realized gains (losses) on investments sold		20,939	105,460	36,117	128,416
Other-than-temporary impairments on investments		(16,520)	(24,362)	(27,035)	(26,638)
Other-than-temporary impairments on investments transferred to (from) other comprehensive income		(68)	(254)	(129)	(1,705)
Life Funds Withheld Assets
Revenues:
Net investment income		46,864	19,165	97,283	19,165
Realized investment gains (losses):
Net realized gains (losses) on investments sold		68,037	624	120,775	624
Other-than-temporary impairments on investments		(2,878)	(8,771)	(8,087)	(8,771)
Net unrealized gains (losses) on investments, trading securities		(19,543)	0	(18,783)	0
Net realized and unrealized gains (losses) on derivative instruments		$ 239,174	$ (17,546)	$ 9,807	$ (17,546)

[1] The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

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Segment Information

6 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company is organized into two operating segments: Insurance and Reinsurance. Subsequent to the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition," the underwriting results of the acquired businesses from the Acquisition Date through June 30, 2015 are included in the Company's Insurance or Reinsurance segment, as appropriate.

The Company’s general investment and financing operations are reflected in "Corporate and Other". Subsequent to the transaction described in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," GCLR reinsures the majority of the Company's life reinsurance business through the Life Retro Arrangements. The results of the Run-Off Life Operations not subject to the Life Retro Arrangements are also reported within Corporate and Other.

The Company evaluates the performance of both the Insurance and Reinsurance segments based on underwriting profit. Other items of revenue and expenditure of the Company are not evaluated at the segment level. In addition, the Company does not allocate investment assets used to support its Property and Casualty ("P&C") operations to the individual segments, except as noted below. Investment assets related to the Company’s Run-Off Life Operations and certain structured products included in the Insurance and Reinsurance segments are held in separately identified portfolios. As such, net investment income from these assets is included in the contribution from the applicable segment or in Corporate and Other. The following tables summarize the segment results for the three and six months ended June 30, 2015 and 2014:

Three Months Ended June 30, 2015 (U.S. dollars in thousands, except ratios)	Insurance			Reinsurance			Total P&C			Corporate and Other (1)			Total
Gross premiums written	$	2,219,444		$	782,248		$	3,001,692		$	79,443		$	3,081,135
Net premiums written	1,401,772			698,301			2,100,073			18,258			2,118,331
Net premiums earned	1,412,906			650,889			2,063,795			18,258			2,082,053
Net losses and loss expenses (2)	896,370			254,825			1,151,195			22,081			1,173,276
Acquisition costs (2)	181,716			158,217			339,933			1,684			341,617
Operating expenses (3)	292,161			71,727			363,888			(59		)	363,829
Underwriting profit (loss)	$	42,659		$	166,120		$	208,779		$	(5,448	)	$	203,331
Net investment income - excluding Life Funds Withheld Assets (4)							149,461			10,831			160,292
Net investment income - Life Funds Withheld Assets										46,864			46,864
Net results from structured products (5)	3,401			1,856			5,257			—			5,257
Net fee income and other (6)	(2,033		)	623			(1,410		)	46			(1,364		)
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets							4,223			128			4,351
Net realized gains (losses) on investments and net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets							—			45,616			45,616
Net realized and unrealized gains (losses) on derivative instruments							—			48,509			48,509
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets							—			239,174			239,174
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			40,839			40,839
Gain on sale of operating affiliate							—			340,407			340,407
Exchange (gains) losses							—			10,374			10,374
Corporate operating expenses							—			130,987			130,987
Contribution from P&C and Corporate and Other							366,310			625,605			991,915
Interest expense (8)										39,038			39,038
Non-controlling interests										4,879			4,879
Income tax expense										32,959			32,959
Net income (loss) attributable to ordinary shareholders													$	915,039
Ratios – P&C operations: (9)
Loss and loss expense ratio	63.4		%	39.2		%	55.8		%
Underwriting expense ratio	33.6		%	35.3		%	34.1		%
Combined ratio	97.0		%	74.5		%	89.9		%

____________

(1) Corporate and Other includes other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest expense of $16.0 million and $10.6 million, respectively.

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

(7) The Company generally 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.

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

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

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 (2)	627,627			200,253			827,880			85,299			913,179
Acquisition costs (2)	99,863			80,874			180,737			3,882			184,619
Operating expenses (3)	213,930			47,582			261,512			2,209			263,721
Underwriting profit (loss)	$	62,570		$	105,377		$	167,947		$	(32,872	)	$	135,075
Net investment income - excluding Life Funds Withheld Assets (4)							144,555			52,118			196,673
Net investment income - Life Funds Withheld Assets										19,165			19,165
Net results from structured products (5)	31,645			3,240			34,885			—			34,885
Net fee income and other (6)	(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 and net unrealized gains (losses) on investments, Trading - 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 and derivative instruments - Life Funds Withheld Assets							—			(17,546		)	(17,546		)
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			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							422,989			(671,937		)	(248,948		)
Interest expense (8)										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													$	(279,260	)
Ratios – P&C operations: (9)
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 other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest credit of $16.9 million and $18.2 million, respectively.

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

(7) The Company generally 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.

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

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

Six Months Ended June 30, 2015 (U.S. dollars in thousands, except ratios)	Insurance			Reinsurance			Total P&C			Corporate and Other (1)			Total
Gross premiums written	$	3,874,191		$	1,607,910		$	5,482,101		$	154,394		$	5,636,495
Net premiums written	2,490,880			1,445,936			3,936,816			32,764			3,969,580
Net premiums earned	2,375,212			1,008,077			3,383,289			32,764			3,416,053
Net losses and loss expenses (2)	1,513,317			407,705			1,921,022			41,468			1,962,490
Acquisition costs (2)	262,103			229,709			491,812			3,501			495,313
Operating expenses (3)	500,618			114,222			614,840			872			615,712
Underwriting profit (loss)	$	99,174		$	256,441		$	355,615		$	(13,077	)	$	342,538
Net investment income - excluding Life Funds Withheld Assets (4)							282,269			21,041			303,310
Net investment income - Life Funds Withheld Assets										97,283			97,283
Net results from structured products (5)	6,306			3,976			10,282			—			10,282
Net fee income and other (6)	(9,498		)	1,448			(8,050		)	178			(7,872		)
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets							10,030			(1,077		)	8,953
Net realized gains (losses) on investments and net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets							—			93,905			93,905
Net realized and unrealized gains (losses) on derivative instruments							—			65,030			65,030
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets							—			9,807			9,807
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			98,836			98,836
Gain on sale of operating affiliate										340,407			340,407
Exchange (gains) losses							—			37,764			37,764
Corporate operating expenses							—			193,430			193,430
Contribution from P&C and Corporate and Other							650,146			481,139			1,131,285
Interest expense (8)										80,519			80,519
Non-controlling interests										42,269			42,269
Income tax expense										57,177			57,177
Net income (loss) attributable to ordinary shareholders													$	951,320
Ratios – P&C operations: (9)
Loss and loss expense ratio	63.7		%	40.4		%	56.8		%
Underwriting expense ratio	32.1		%	34.2		%	32.7		%
Combined ratio	95.8		%	74.6		%	89.5		%

____________

(1) Corporate and Other includes other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest expense of $31.1 million and $20.6 million, respectively.

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

(7) The Company generally 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.

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

(9) 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 (2)	1,266,820			392,565			1,659,385			198,886			1,858,271
Acquisition costs (2)	204,863			168,109			372,972			11,061			384,033
Operating expenses (3)	416,983			88,443			505,426			5,397			510,823
Underwriting profit (loss)	$	107,764		$	205,057		$	312,821		$	(80,515	)	$	232,306
Net investment income - excluding Life Funds Withheld Assets (4)							288,082			123,010			411,092
Net investment income - Life Funds Withheld Assets										19,165			19,165
Net results from structured products (5)	36,535			6,303			42,838			—			42,838
Net fee income and other (6)	(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 and net unrealized gains (losses) on investments, Trading - 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 and derivative instruments - Life Funds Withheld Assets							—			(17,546		)	(17,546		)
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			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							736,470			(627,461		)	109,009
Interest expense (8)										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													$	(23,543	)
Ratios – P&C operations: (9)
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 other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest credit of $35.7 million and $7.4 million, respectively.

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

(7) The Company generally 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.

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

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

The following tables summarize the Company’s net premiums earned by line of business for the three and six months ended June 30, 2015 and 2014:

Three Months Ended June 30, 2015 (U.S. dollars in thousands)	Insurance			Reinsurance		Corporate and Other		Total
P&C Operations:
Professional	$	286,348		$	43,225	$	—	$	329,573
Casualty	420,472			125,787		—		546,259
Property catastrophe	—			163,453		—		163,453
Property	215,128			231,897		—		447,025
Marine, energy, aviation and satellite	(16		)	32,549		—		32,533
Specialty	411,438			—		—		411,438
Other (1)	79,536			53,978		—		133,514
Total P&C Operations	$	1,412,906		$	650,889	$	—	$	2,063,795
Corporate and Other:
Run-off Life operations - Annuity	$	—		$	—	$	1	$	1
Run-off Life operations - Other Life	—			—		18,257		18,257
Total Corporate and Other	$	—		$	—	$	18,258	$	18,258
Total	$	1,412,906		$	650,889	$	18,258	$	2,082,053
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	$	—		$	—	$	21,564	$	21,564
Run-off Life operations - Other Life	—			—		36,954		36,954
Total Corporate and Other	$	—		$	—	$	58,518	$	58,518
Total	$	1,003,990		$	434,086	$	58,518	$	1,496,594

____________

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

Six Months Ended June 30, 2015 (U.S. dollars in thousands)	Insurance			Reinsurance		Corporate and Other		Total
P&C Operations:
Professional	$	552,759		$	78,233	$	—	$	630,992
Casualty	729,807			183,995		—		913,802
Property catastrophe	—			257,526		—		257,526
Property	343,369			363,121		—		706,490
Marine, energy, aviation and satellite	(16		)	50,624		—		50,608
Specialty	596,162			—		—		596,162
Other (1)	153,131			74,578		—		227,709
Total P&C Operations	$	2,375,212		$	1,008,077	$	—	$	3,383,289
Corporate and Other:
Run-off Life operations - Annuity	$	—		$	—	$	—	$	—
Run-off Life operations - Other Life	—			—		32,764		32,764
Total Corporate and Other	$	—		$	—	$	32,764	$	32,764
Total	$	2,375,212		$	1,008,077	$	32,764	$	3,416,053
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	$	—		$	—	$	53,361	$	53,361
Run-off Life operations - Other Life	—			—		81,468		81,468
Total Corporate and Other	$	—		$	—	$	134,829	$	134,829
Total	$	1,996,430		$	854,174	$	134,829	$	2,985,433

____________

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

XML

Fair Value Measurements

6 Months Ended

Jun. 30, 2015

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Fair value is defined as the amount that would be received for the sale of an asset or paid to transfer a liability (an exit price), in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. The Company reviews the fair value hierarchy classification on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy.

The fair values for available for sale investments are generally sourced from third parties. The fair value of fixed income securities is based upon quoted market values where available, "evaluated bid" prices provided by third party pricing services ("pricing services") where quoted market values are not available, or by reference to broker quotes where pricing services do not provide coverage for a particular security. While the Company receives values for the majority of the investment securities it holds from pricing services, it is ultimately management’s responsibility to determine whether the values received and recorded in the financial statements are representative of appropriate fair value measurements.

The Company performs regular reviews of the prices received from its third party valuation sources to assess if the prices represent a reasonable estimate of the fair value. This process is completed by investment and accounting personnel who are independent of those responsible for obtaining the valuations. The approaches taken by the Company include, but are not limited to, annual reviews of the controls of the external parties responsible for sourcing valuations, which are subjected to automated tolerance checks, quarterly reviews of the valuation sources and dates, and monthly reconciliations between the valuations provided by our external parties and valuations provided by our third party investment managers at a portfolio level.

Where broker quotes are the primary source of the valuations, sufficient information regarding the specific inputs utilized by the brokers is generally not available to support a Level 2 classification. The Company obtains the majority of broker quoted values from third party investment managers who perform independent verifications of these valuations using pricing matrices based upon information gathered by market traders. In addition, for the majority of these securities, the Company compares the broker quotes to independent valuations obtained from third party pricing vendors, which may also consist of broker quotes, to assess if the prices received represent a reasonable estimate of the fair value.

As discussed in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," under the Life Retro Arrangements, all of the investment results associated with the Life Funds Withheld Assets ultimately accrue to GCLR. Because the Company no longer shares in the risks and rewards of the underlying performance of the Life Funds Withheld Assets, the financial statements and accompanying notes included herein separately report the Life Funds Withheld Assets from the rest of the Company's investments.

For further information about the Company's fair value measurements, see Item 8, Note 2(b), "Significant Accounting Policies - Fair Value Measurements," to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

(a) Fair Value Summary

The following tables set forth the Company’s assets and liabilities that were accounted for at fair value as of June 30, 2015 and December 31, 2014 by level within the fair value hierarchy:

June 30, 2015 (U.S. dollars in thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Collateral and Counterparty Netting		Balance at June 30, 2015
Assets
Fixed maturities - Available for Sale ("AFS") - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	3,827,106	$	—	$	—	$	3,827,106
Corporate - Financials	—		3,225,513		10,000		—		3,235,513
Corporate - Non Financials (1)	—		6,946,510		5,554		—		6,952,064
Residential mortgage-backed securities – Agency ("RMBS - Agency")	—		3,955,106		3,038		—		3,958,144
Residential mortgage-backed securities – Non-Agency ("RMBS - Non-Agency")	—		372,271		—		—		372,271
Commercial mortgage-backed securities ("CMBS")	—		936,058		—		—		936,058
Collateralized debt obligations ("CDO")	—		3,854		484,171		—		488,025
Other asset-backed securities (1)	—		2,307,642		42,745		—		2,350,387

U.S. States and political subdivisions of the States	—		2,391,273		—		—			2,391,273
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		5,260,062		—		—			5,260,062
Total fixed maturities - AFS - Excluding Funds Withheld Assets, at fair value	$	—	$	29,225,395	$	545,508	$	—		$	29,770,903
Equity securities, at fair value	659,338		414,132		—		—			1,073,470
Short-term investments, at fair value (1)(2)	—		807,486		—		—			807,486
Total investments AFS - Excluding Funds Withheld Assets	$	659,338	$	30,447,013	$	545,508	$	—		$	31,651,859
Fixed maturities - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	13,678	$	—	$	—		$	13,678
Corporate - Financials	—		722,922		—		—			722,922
Corporate - Non Financials	—		1,665,678		—		—			1,665,678
RMBS – Agency	—		837		—		—			837
RMBS – Non-Agency	—		29,591		—		—			29,591
CMBS	—		145,617		—		—			145,617
Other asset-backed securities	—		187,537		—		—			187,537
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		1,231,228		—		—			1,231,228
Total fixed maturities - AFS - Life Funds Withheld Assets, at fair value	$	—	$	3,997,088	$	—	$	—		$	3,997,088
Total investments - AFS, at fair value	$	659,338	$	34,444,101	$	545,508	$	—		$	35,648,947
Fixed maturities - trading securities ("Trading")
U.S. Government and Government-Related/Supported	$	—	$	3,596	$	—	$	—		$	3,596
Corporate - Financials	—		187,169		—		—			187,169
Corporate - Non Financials	—		332,654		—		—			332,654
CMBS	—		261		—		—			261
Other asset-backed securities	—		14,823		—		—			14,823
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		252,981		—		—			252,981
Total fixed maturities - Trading, at fair value	$	—	$	791,484	$	—	$	—		$	791,484
Cash equivalents (3)	705,092		270,784		—		—			975,876
Cash equivalents - Life Funds Withheld Assets (3)	143		91,367		—		—			91,510
Other investments (4)	—		1,139,393		255,672		—			1,395,065
Other assets (5)	—		215,083		13,392		(3,239		)	225,236
Total assets accounted for at fair value	$	1,364,573	$	36,952,212	$	814,572	$	(3,239	)	$	39,128,118
Liabilities
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable) (6)	$	—	$	381,337	$	—	$	—		$	381,337
Financial instruments sold, but not yet purchased (7)	1,581		1,233		—		—			2,814
Other liabilities (5)	—		59,739		23,145		(3,239		)	79,645
Total liabilities accounted for at fair value	$	1,581	$	442,309	$	23,145	$	(3,239	)	$	463,796

December 31, 2014 (U.S. dollars in thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Collateral and Counterparty Netting			Balance at December 31, 2014
Assets
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	2,171,953	$	—	$	—		$	2,171,953
Corporate - Financials	—		2,761,916		—		—			$	2,761,916
Corporate - Non Financials (1)	—		6,010,563		5,894		—			$	6,016,457
Residential mortgage-backed securities – RMBS - Agency	—		3,726,666		1,910		—			$	3,728,576
Residential mortgage-backed securities – RMBS - Non-Agency	—		427,351		—		—			$	427,351
CMBS	—		1,052,544		—		—			$	1,052,544
CDO	—		4,076		687,958		—			$	692,034
Other asset-backed securities (1)	—		1,060,005		5,288		—			$	1,065,293
U.S. States and political subdivisions of the States	—		2,021,272		—		—			$	2,021,272
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		4,240,073		—		—			$	4,240,073
Total fixed maturities - AFS - Excluding Funds Withheld Assets, at fair value	$	—	$	23,476,419	$	701,050	$	—		$	24,177,469
Equity securities, at fair value	502,284		366,008		—		—			868,292
Short-term investments, at fair value (1)(2)	—		256,727		—		—			256,727
Total investments AFS - Excluding Funds Withheld Assets	$	502,284	$	24,099,154	$	701,050	$	—		$	25,302,488
Fixed maturities - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	—	$	18,724	$	—	$	—		$	18,724
Corporate - Financials	—		801,019		—		—			$	801,019
Corporate - Non Financials	—		2,016,961		—		—			$	2,016,961
RMBS – Agency	—		3,782		—		—			$	3,782
RMBS – Non-Agency	—		85,335		—		—			$	85,335
CMBS	—		193,167		—		—			$	193,167
Other asset-backed securities	—		273,541		—		—			$	273,541
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	—		1,789,036		—		—			$	1,789,036
Total fixed maturities - AFS - Life Funds Withheld Assets, at fair value	$	—	$	5,181,565	$	—	$	—		$	5,181,565
Total investments - AFS, at fair value	$	502,284	$	29,280,719	$	701,050	$	—		$	30,484,053
Fixed maturities - Trading
Corporate - Non Financials	—		1,171		—		—			$	1,171
Total fixed maturities - Trading, at fair value	$	—	$	1,171	$	—	$	—		$	1,171
Cash equivalents (3)	1,103,877		397,955		—		—			$	1,501,832
Cash equivalents - Life Funds Withheld Assets (3)	460		132,738		—		—			$	133,198
Other investments (4)	—		708,974		185,083		—			$	894,057
Other assets (5)	—		122,996		13,663		(696		)	$	135,963
Total assets accounted for at fair value	$	1,606,621	$	30,644,553	$	899,796	$	(696	)	$	33,150,274
Liabilities
Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable) (6)	$	—	$	450,831	$	—	$	—		$	450,831
Financial instruments sold, but not yet purchased (7)	4,737		25,669		—		—			$	30,406
Other liabilities (5)	—		7,757		23,427		(696		)	$	30,488
Total liabilities accounted for at fair value	$	4,737	$	484,257	$	23,427	$	(696	)	$	511,725

____________

(1) Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes had a fair value of $75.3 million and $79.9 million and an amortized cost of $64.5 million and $68.4 million as of June 30, 2015 and December 31, 2014, respectively. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate values of these notes.

(2) Short-term investments consist primarily of Corporate securities and U.S. and Non-U.S. Government and Government-Related/Supported securities.

(3) Cash equivalents balances subject to fair value measurement include certificates of deposit and money market funds. Operating cash balances are not subject to recurring fair value measurement guidance.

(4) The Other investments balance excludes certain structured transactions including certain investments in project finance transactions, and a payment obligation and liquidity financing provided to a structured credit vehicle as a part of a third party medium term note facility. These investments, which totaled $348.2 million as of June 30, 2015 and $354.4 million at December 31, 2014, are carried at amortized cost. For further information, see Item 8, Note 8, "Other Investments," to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.

(5) Other assets and other liabilities include derivative instruments. The derivative balances included in each category are reported on a gross basis by level with a netting adjustment presented separately in the Collateral and Counterparty Netting column. The fair values of the individual derivative contracts are reported gross in their respective levels based on the fair value hierarchy. For further details regarding derivative fair values and associated collateral received or paid see Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements.

(6) Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable) include balances related to the life retrocession embedded derivative, under which all investment results associated with the Life Funds Withheld Assets related to the Life Retro Arrangements described in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary," accrue to the benefit of GCLR.

(7) Financial instruments sold, but not yet purchased, represent "short sales" and are included within "Payable for investments purchased" on the balance sheets.

(b) Level 3 Assets and Liabilities

The tables below present additional information about assets and liabilities measured at fair value on a recurring basis and for which Level 3 inputs were utilized to determine fair value. The tables present a reconciliation of the beginning and ending balances for the three and six months ended June 30, 2015 and 2014 for all financial assets and liabilities measured at fair value using significant unobservable inputs (Level 3) at June 30, 2015 and 2014, respectively. The tables do not include gains or losses that were reported in Level 3 in prior periods for assets that were transferred out of Level 3 prior to June 30, 2015 and 2014, respectively. Gains and losses for assets and liabilities classified within Level 3 in the table below may include changes in fair value that are attributable to both observable inputs (Levels 1 and 2) and unobservable inputs (Level 3). Further, it should be noted that the following tables do not take into consideration the effect of offsetting Level 1 and 2 financial instruments entered into by the Company that are either economically hedged by certain exposures to the Level 3 positions or that hedge the exposures in Level 3 positions.

In general, Level 3 assets include securities for which values were obtained from brokers where either significant inputs were utilized in determining the values that were difficult to corroborate with observable market data, or sufficient information regarding the specific inputs utilized by the broker was not available to support a Level 2 classification. Transfers into or out of Level 3 primarily arise as a result of the valuations utilized by the Company changing between either those provided by independent pricing services that do not contain significant unobservable inputs or other valuations sourced from brokers that are considered Level 3.

There were no significant transfers between Level 1 and Level 2 during each of the three and six months ended June 30, 2015 and 2014.

	Level 3 Assets and Liabilities -Three Months Ended June 30, 2015
(U.S. dollars in thousands)	Corporate - Financials		Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—	$	5,861		$	1,820		$	—
Realized gains (losses)	—		(140		)	—			—
Movement in unrealized gains (losses)	—		(44		)	(1		)	—
Purchases and issuances (1)	10,000		(123		)	1,297			—
Sales	—		—			—			—
Settlements	—		—			(78		)	—
Transfers into Level 3						—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	10,000	$	5,554		$	3,038		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	(184	)	$	(1	)	$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2015
(U.S. dollars in thousands)	CMBS		CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	—	$	496,923		$	2,244		$	—
Realized gains (losses)	—		224			92			—
Movement in unrealized gains (losses)	—		2,445			8			—
Purchases and issuances (1)	—		11,941			40,628			—
Sales	—		—						—
Settlements	—		(27,362		)	(227		)	—
Transfers into Level 3	—		—			—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	—	$	484,171		$	42,745		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	2,057		$	100		$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2015
(U.S. dollars in thousands)			Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period			$	—		$	190,097		$	(9,606	)
Realized gains (losses)			—			1,291			—
Movement in unrealized gains (losses)			—			(139		)	(147		)
Purchases and issuances (1)			—			66,510			—
Sales			—
Settlements			—			(2,087		)	—
Transfers into Level 3			—			—			—
Transfers out of Level 3			—			—			—
Fixed maturities to short-term investments classification change			—			—			—
Balance, end of period			$	—		$	255,672		$	(9,753	)
Movement in total gains (losses) above relating to instruments still held at the reporting date			$	—		$	1,152		$	(147	)

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

	Level 3 Assets and Liabilities -Three Months Ended June 30, 2014
(U.S. dollars in thousands)	Corporate - Financials			Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—		$	4,382		$	8,928		$	11
Realized gains (losses)	—			35			6			—
Movement in unrealized gains (losses)	—			(93		)	(13		)	—
Purchases and issuances (1)	—			8			—			—
Sales	—			—			—			—
Settlements	—			(399		)	(2,025		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			—			—			—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	—		$	3,933		$	6,896		$	11
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	(58	)	$	(6	)	$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2014
(U.S. dollars in thousands)	CMBS			CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	5,926		$	718,827		$	10,673		$	—
Realized gains (losses)	2			875			(5		)	—
Movement in unrealized gains (losses)	(1		)	8,331			144			—
Purchases and issuances (1)	1,376			75,201			3,000			—
Sales	—			(30,892		)	—			—
Settlements	(5,358		)	(39,518		)	(2,108		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			—			—			—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	1,945		$	732,824		$	11,704		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	8,247		$	140		$	—
	Level 3 Assets and Liabilities -Three Months Ended June 30, 2014
(U.S. dollars in thousands)				Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period				$	—		$	116,418		$	(32,496	)
Realized gains (losses)				—			5,127			—
Movement in unrealized gains (losses)				—			(1,779		)	13,586
Purchases and issuances (1)				—			9,997			—
Sales				—			—			—
Settlements				—			(5,288		)	—
Transfers into Level 3				—			—			—
Transfers out of Level 3				—			—			—
Fixed maturities to short-term investments classification change				—			—			—
Balance, end of period				$	—		$	124,475		$	(18,910	)
Movement in total gains (losses) above relating to instruments still held at the reporting date				$	—		$	3,348		$	13,586

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

	Level 3 Assets and Liabilities - Six Months Ended June 30, 2015
(U.S. dollars in thousands)	Corporate - Financials		Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—	$	5,894		$	1,910		$	—
Realized gains (losses)	—		(141		)	—			—
Movement in unrealized gains (losses)	—		4			(2		)	—
Purchases and issuances (1)	10,000		(123		)	1,297			—
Sales	—		—			—			—
Settlements	—		(80		)	(167		)	—
Transfers into Level 3	—		—			—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	10,000	$	5,554		$	3,038		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	(136	)	$	—		$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2015
(U.S. dollars in thousands)	CMBS		CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	—	$	687,958		$	5,288		$	—
Realized gains (losses)	—		260			91			—
Movement in unrealized gains (losses)	—		8,000			10			—
Purchases and issuances (1)	—		11,941			40,628			—
Sales	—		(155,085		)	—			—
Settlements	—		(68,903		)	(3,272		)	—
Transfers into Level 3	—		—			—			—
Transfers out of Level 3	—		—			—			—
Fixed maturities to short-term investments classification change	—		—			—			—
Balance, end of period	$	—	$	484,171		$	42,745		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—	$	4,725		$	100		$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2015
(U.S. dollars in thousands)			Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period			$	—		$	185,083		$	(9,764	)
Realized gains (losses)			—			2,593			—
Movement in unrealized gains (losses)			—			(1,966		)	11
Purchases and issuances (1)			—			73,303			—
Sales			—			—			—
Settlements			—			(3,341		)	—
Transfers into Level 3			—			—			—
Transfers out of Level 3			—			—			—
Fixed maturities to short-term investments classification change			—			—			—
Balance, end of period			$	—		$	255,672		$	(9,753	)
Movement in total gains (losses) above relating to instruments still held at the reporting date			$	—		$	628		$	11

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

	Level 3 Assets and Liabilities - Six Months Ended June 30, 2014
(U.S. dollars in thousands)	Corporate - Financials			Corporate - Non-Financials			RMBS - Agency			RMBS - Non Agency
Balance, beginning of period	$	—		$	31,573		$	10,473		$	9
Realized gains (losses)	—			155			6			—
Movement in unrealized gains (losses)	—			(96		)	(13		)	2
Purchases and issuances (1)	—			1,443			—			—
Sales	—			—			—			—
Settlements	—			(5,513		)	(2,598		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			(23,629		)	(972		)	—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	—		$	3,933		$	6,896		$	11
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	90		$	(6	)	$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2014
(U.S. dollars in thousands)	CMBS			CDO			Other asset- backed securities			Non-US Sovereign Government, Provincial, Supranational and Government Related/Supported
Balance, beginning of period	$	12,533		$	710,253		$	11,877		$	—
Realized gains (losses)	3			2,456			(20		)	—
Movement in unrealized gains (losses)	(3		)	12,013			206			—
Purchases and issuances (1)	1,376			103,015			3,000			—
Sales	—			(40,824		)	—			—
Settlements	(11,964		)	(54,089		)	(3,359		)	—
Transfers into Level 3	—			—			—			—
Transfers out of Level 3	—			—			—			—
Fixed maturities to short-term investments classification change	—			—			—			—
Balance, end of period	$	1,945		$	732,824		$	11,704		$	—
Movement in total gains (losses) above relating to instruments still held at the reporting date	$	—		$	13,216		$	186		$	—
	Level 3 Assets and Liabilities - Six Months Ended June 30, 2014
(U.S. dollars in thousands)				Short-term investments			Other investments			Derivative Contracts - Net
Balance, beginning of period				$	2,015		$	113,472		$	(29,110	)
Realized gains (losses)				—			8,691			—
Movement in unrealized gains (losses)				(15		)	(282		)	10,200
Purchases and issuances (1)				—			21,086			—
Sales				—			—			—
Settlements				(2,000		)	(18,492		)	—
Transfers into Level 3				—			—			—
Transfers out of Level 3				—			—			—
Fixed maturities to short-term investments classification change				—			—			—
Balance, end of period				$	—		$	124,475		$	(18,910	)
Movement in total gains (losses) above relating to instruments still held at the reporting date				$	—		$	8,409		$	10,200

____________

(1)Includes assets acquired as result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition".

(c) Fixed maturities and short-term investments

The Company’s Level 3 assets consist primarily of CDOs, for which non-binding broker quotes are the primary source of the valuations. Sufficient information regarding the specific inputs utilized by the brokers was not available to support a Level 2 classification. The Company obtains the majority of broker quotes for these CDOs from third party investment managers who perform independent verifications of these valuations using pricing matrices based upon information gathered by market traders. In addition, for the majority of these securities, the Company compares the broker quotes to independent valuations obtained from third party pricing vendors, which may also consist of broker quotes, to assess if the prices received represent a reasonable estimate of the fair value. Although the Company does not have access to the specific unobservable inputs that may have been used in the fair value measurements of the CDO securities provided by brokers, we would expect that the significant inputs considered are prepayment rates, probability of default, loss severity in the event of default, recovery rates, liquidity premium and reinvestment rates. Significant increases (decreases) in any of those inputs in isolation could result in a significantly different fair value measurement. Generally, a change in the assumption used for the probability of default is accompanied by a directionally similar change in the assumption used for the loss severity and a directionally opposite change in the assumption used for prepayment rates.

The remainder of the Level 3 assets relate primarily to private investment funds and certain derivative positions as described below.

(d) Other investments

Included within the Other investments component of the Company’s Level 3 valuations are private investments and alternative fund investments where the Company is not deemed to have significant influence over the investee. The fair value of these investments is based upon net asset values received from the investment manager or general partner of the respective entity. The nature of the underlying investments held by the investee that form the basis of the net asset value include assets such as private business ventures and are such that significant Level 3 inputs are utilized in the determination of the individual underlying holding values and, accordingly, the fair value of the Company’s investment in each entity is classified within Level 3. The Company has not adjusted the net asset values received; however, management incorporates factors such as the most recent financial information received, annual audited financial statements and the values at which capital transactions with the investee take place when applying judgment regarding whether any adjustments should be made to the net asset value in recording the fair value of each position. Investments in alternative funds included in Other investments utilize strategies including arbitrage, directional, event driven and multi-style. These funds potentially have lockup and gate provisions which may limit redemption liquidity. For further details regarding the nature of Other investments and related features see Item 8, Note 8, "Other Investments," to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

(e) Derivative instruments

Derivative instruments recorded within Other liabilities and classified within Level 3 include credit derivatives providing protection on senior tranches of structured finance transactions where the value is obtained directly from the investment bank counterparty and sufficient information regarding the inputs utilized in such valuation was not obtained to support a Level 2 classification and guaranteed minimum income benefits embedded within one reinsurance contract. The majority of inputs utilized in the valuations of these types of derivative contracts are considered Level 1 or Level 2; however, each valuation includes at least one Level 3 input that was significant to the valuation and, accordingly, the values are disclosed within Level 3.

The calculation of the change in fair value of the embedded derivative associated with the Life Retro Arrangements includes interest income and realized and unrealized gains and losses on Life Funds Withheld Assets and certain related expenses related to the Life Funds Withheld Assets. The fair value of the embedded derivative is included in "Funds withheld on life retrocession arrangements, net of future policy benefit reserves recoverable" on the consolidated balance sheets. The fair value of the embedded derivative is considered a Level 2 valuation.

(f) Financial Instruments Not Carried at Fair Value

Authoritative guidance over disclosures about the fair value of financial instruments requires additional disclosure of fair value information for financial instruments not carried at fair value in both interim and annual reporting periods. Certain financial instruments, particularly insurance contracts, are excluded from these fair value disclosure requirements. The carrying values of cash and cash equivalents, accrued investment income, net receivable from investments sold, other assets, net payable for investments purchased, other liabilities and other financial instruments not included below approximated their fair values. The following table includes financial instruments for which the carrying value differs from the estimated fair values as of June 30, 2015 and December 31, 2014. All of these fair value estimates are considered Level 2 fair value measurements. The fair values for fixed maturities held to maturity are provided by third party pricing vendors and significant valuation inputs for all other items included were based upon market data obtained from sources independent of the Company, and are subject to the same control environment previously described.

	June 30, 2015				December 31, 2014
(U.S. dollars in thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial Assets - Other investments, structured transactions	$	348,192	$	365,335	$	354,382	$	371,625
Deposit liabilities	$	1,212,206	$	1,528,520	$	1,245,367	$	1,543,761
Notes payable and debt	2,726,455		2,911,949		1,662,580		1,897,854
Financial Liabilities	$	3,938,661	$	4,440,469	$	2,907,947	$	3,441,615

The Company historically participated in structured transactions. Remaining structured transactions include cash loans supporting project finance transactions, a liquidity facility financing provided to structured project deals and an investment in a payment obligation with an insurance company. These transactions are carried at amortized cost. The fair value of these investments held by the Company is determined through use of internal models utilizing reported trades, benchmark yields, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data.

Deposit liabilities include obligations under structured insurance and reinsurance transactions. For purposes of fair value disclosures, the Company determined the estimated fair value of the deposit liabilities by assuming a discount rate equal to the appropriate U.S. Treasury rate plus 48.6 basis points and 29.5 basis points as of June 30, 2015 and December 31, 2014, respectively. The discount rate incorporates the Company’s own credit risk into the determination of estimated fair value.

The fair values of the Company’s notes payable and debt outstanding were determined based on quoted market prices.

There are no significant concentrations of credit risk within the Company’s financial instruments as defined in the authoritative guidance over disclosures of fair value of financial instruments not carried at fair value, which excludes certain financial instruments, particularly insurance contracts.

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Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2015

Accounting Policies [Abstract]

Restricted cash

Restricted Cash

Restricted cash represents cash and cash equivalents that the Company is a) holding for the benefit of a third party and which is legally or contractually restricted as to withdrawal or usage for general corporate purposes; and b) not replaceable by another type of asset other than cash or cash equivalents, under the terms of the Company's contractual arrangements with such third parties. Restricted cash includes cash and cash equivalents held pursuant to the terms of the Company's contractual obligations of the transaction described in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary."

Recent accounting pronouncements

Recent Accounting Pronouncements

In February 2015, the Financial Accounting Standards Board ("FASB") issued an accounting standards update concerning consolidation of certain legal entities. Under this new guidance, all legal entities are required to evaluate whether they should consolidate certain legal entities. The guidance: (1) modifies the evaluation of whether limited partnerships and similar legal entities are variable interest entities ("VIEs") or voting interest entities; (2) eliminates the presumption that a general partner should consolidate a limited partnership; (3) affects the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships; and (4) provides a scope exception from consolidation guidance for certain reporting entities. Upon adoption of the new guidance, differing requirements for performing a consolidation analysis under existing GAAP will be eliminated, and all reporting entities will now fall within the scope of the Accounting Standards Codification Subtopic 810-10, Consolidation-Overall, unless a specific exception applies. Under this Subtopic, there are only two primary models for determining whether consolidation is appropriate - a voting interest entity model, and a variable interest entity model. The guidance is effective for public business entities for annual periods beginning after December 15, 2015, and interim and annual periods thereafter, with early adoption permitted. The Company is currently evaluating the impact of this guidance.

In April 2015, the FASB issued an accounting standards update concerning the presentation of deferred debt issuance costs in an entity's balance sheet. Under this new guidance, which is part of the FASB's initiative to reduce complexity in accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements, it is required that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. In addition, the guidance also requires that the amortization of such costs be reported as interest expense. The guidance is effective for public business entities for annual periods beginning after December 15, 2015, and interim and annual periods thereafter, with early adoption permitted for financial statements that have not been previously issued. This guidance is not expected to have a material impact on the Company's financial condition, results of operations or cash flows.

In May 2015, the FASB issued an accounting standards update concerning investments for which management estimates fair value using net asset value per share (or its equivalent) as a practical expedient. Under the guidance, such investments will no longer be reported within the fair value hierarchy. Removing those investments from the fair value hierarchy not only eliminates the diversity in practice resulting from the way in which investments measured at net asset value per share (or its equivalent) with future redemption dates are classified, but also ensures that all investments categorized in the fair value hierarchy are classified using a consistent approach. Investments that calculate net asset value per share (or its equivalent), but for which the practical expedient is not applied, will continue to be included in the fair value hierarchy. A reporting entity should continue to disclose information on investments for which fair value is measured at net asset value (or its equivalent) as a practical expedient to help users understand the nature and risks of the investments and whether the investments, if sold, are probable of being sold at amounts different from net asset value. The guidance is effective for public business entities for annual periods beginning after December 15, 2015 and interim and annual periods thereafter, with early adoption permitted. The Company is currently evaluating the impact of this guidance, but it is not expected to have a material impact on the Company's financial condition, results of operations or cash flows.

In May 2015, the FASB issued an accounting standards update concerning the annual disclosure regarding the liability for unpaid claims and claims adjustment expenses for insurance entities. The guidance requires: (1) incurred and paid claims development information by accident year, on a net basis after reinsurance, for the number of years for which claims incurred typically remain outstanding, including the most recent reporting period, which need not exceed 10 years; (2) a reconciliation of incurred and paid claims development information to the aggregate carrying amount of the liability for unpaid claims and claim adjustment expenses, with separate disclosure of reinsurance recoverable on unpaid claims for each period presented in the statement of financial position; (3) for each accident year for which incurred claims development information is presented, the total of incurred but not reported ("IBNR") liabilities plus expected development on reported claims included in the liability for unpaid claims and claims adjustment expenses, accompanied by a description of reserving methodologies; (4) for each accident year for which incurred claims development information is presented, quantitative information about claim frequency (unless it is impracticable to do so) accompanied by a qualitative description of methodologies used for determining claim frequency information; and (5) for all claims, the average annual percentage payout of incurred claims by age for the same number of accident years as the disclosure for IBNR. The guidance recommends that insurance entities aggregate or disaggregate those disclosures so that useful information is not obscured by either the inclusion of a large amount of insignificant detail or the aggregation of items that have significantly different characteristics. The amendments also require insurance entities to disclose information about significant changes in methodologies and assumptions used to calculate the liability for unpaid claims and claim adjustment expenses, including reasons for the change and the effects on the financial statements. Additionally, the amendments require insurance entities to disclose for annual and interim reporting periods a rollforward of the liability for unpaid claims and claims adjustment expenses. Additional disclosures about liabilities for unpaid claims and claim adjustment expenses reported at present value include: (1) for each period presented in the statement of financial position, the aggregate amount of discount for the time value of money deducted to derive the liability for unpaid claims and claim adjustment expenses; (2) for each period presented in the statement of income, the amount of interest accretion recognized; and (3) the line items in the statement of income in which interest accretion is classified. The guidance is effective for public business entities for annual periods beginning after December 15, 2015 and interim periods within annual periods after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact of this guidance, but it is not expected to have a material impact on the Company's financial condition, results of operations or cash flows

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Variable Interest Entities

6 Months Ended

Jun. 30, 2015

Variable Interest Entities Disclosure [Abstract]

Variable Interest Entities

Variable Interest Entities

At times, the Company has utilized variable interest entities ("VIEs") both indirectly and directly in the ordinary course of the Company's business.

The Company invests in CDOs and other investment vehicles that are issued through VIEs as part of the Company's investment portfolio. The activities of these VIEs are generally limited to holding the underlying collateral used to service investments therein. The Company's involvement in these entities is passive in nature and we are not the arranger of these entities. In addition, the Company has not been involved in establishing these entities.

The Company has a limited number of remaining outstanding credit enhancement exposures, including written financial guarantee and credit default swap contracts. The obligations related to these transactions are often securitized through VIEs. The Company is not the primary beneficiary of these VIEs as contemplated in current authoritative accounting guidance on the basis that management does not believe that the Company has the power to direct the activities, such as asset selection and collateral management, which most significantly impact each entity's economic performance. For further details on the nature of the obligations and the size of the Company's maximum exposure, see Note 7, "Derivative Instruments," and Note 14(a), "Commitments and Contingencies - Financial Guarantee Exposures."

During the third quarter of 2013, the Company, along with other investors, formed New Ocean to act as an investment manager focused on providing third-party investors access to insurance-linked securities and other insurance and reinsurance capital markets products. The Company holds a majority voting interest in New Ocean through its ownership of common shares and, accordingly, the financial statements of New Ocean have been included in the consolidated financial statements of the Company. None of the assets, liabilities, revenues or net income of New Ocean was material to the Company during the three and six months endedJune 30, 2015. The equity interest attributable to third party investors in New Ocean recorded in the Company’s Unaudited Consolidated Balance Sheets as "Non-controlling interest in equity of consolidated subsidiaries" was $0.2 million and $0.2 million as of June 30, 2015 and December 31, 2014, respectively.

During the fourth quarter of 2013, the Company, along with other investors, invested in a new Bermuda-based company, New Ocean Focus Cat Fund Ltd. ("New Ocean FCFL"), which is considered a VIE under GAAP. During the second quarter of 2014, the Company formed another new Bermuda-based investment company, New Ocean Market Value Cat Fund, Ltd. ("New Ocean MVCFL"), which is also considered a VIE under GAAP. New Ocean MVCFL primarily invests in insurance-linked securities, with a current focus on catastrophe bonds.

During the year ended December 31, 2014, New Ocean FCFL invested in a special purpose Bermuda reinsurer, Vector Reinsurance Ltd ("Vector Re"), formed for the purpose of underwriting collateralized excess of loss reinsurance with a focus on global property catastrophe risks. During the first quarter of 2015, New Ocean MVCFL also invested in Vector Re. Most of Vector Re’s current underwriting activity relates to reinsurance business assumed from the Company's subsidiaries. Underwriting administration and claims services are provided to Vector Re by the Company under service fee contracts which management believes were negotiated at arm's-length, while investment advisory services are provided by New Ocean.

The Company currently holds majority equity interests, which are considered to be the controlling financial interests, in New Ocean FCFL and New Ocean MVCFL, and by extension, Vector Re. Accordingly, included in the consolidated financial statements of the Company are the total net assets of New Ocean FCFL, New Ocean MVCFL and Vector Re of $135.9 million and $139.9 million as of June 30, 2015 and December 31, 2014, respectively. The Company’s share of revenue and net income in these VIEs was not material to the Company for the three and six months endedJune 30, 2015. All inter-company transactions between the Company's entities have been eliminated in consolidation. The equity interest attributable to third party investors in New Ocean FCFL, New Ocean MVCFL and Vector Re recorded in the Company’s Consolidated Balance Sheets as "Non-controlling interest in equity of consolidated subsidiaries" was $52.0 million and $58.4 million as of June 30, 2015 and December 31, 2014, respectively.

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Goodwill and Other Intangible Assets

6 Months Ended

Jun. 30, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and other Intangible Assets

Goodwill and Other Intangible Assets

The Company has goodwill and intangible assets of $2.2 billion and $448.0 million at June 30, 2015 and December 31, 2014, respectively.

In the second quarter of 2015, as a result of the transaction described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition," the Company recognized additional intangible assets. The transaction was accounted for using the acquisition method under which the Company recorded the identifiable assets acquired, including indefinite-lived and definite-lived intangible assets, and liabilities assumed, at their acquisition fair values, and recorded the excess of consideration transferred over the net assets acquired as goodwill.

During the first quarter of 2014, goodwill and intangible assets increased as a result of the completion of an acquisition. The transaction was accounted for using the acquisition method under which the Company recorded the identifiable assets acquired - including definite-lived intangible assets, and liabilities assumed, at their acquisition date fair values, and recorded the excess of consideration transferred over the net assets acquired as goodwill.

The following table presents an analysis of intangible assets broken down between goodwill, intangible assets with an indefinite life and intangible assets with a definite life for the six months ended June 30, 2015:

(U.S. dollars in thousands)	Goodwill			Intangible assets with an indefinite life		Intangible assets with a definite life			Total
Balance at December 31, 2014	$	415,936		$	15,366	$	16,650		$	447,952
Additions	778,043			673,000		315,000			1,766,043
Amortization	—			—		(4,335		)	(4,335		)
Foreign Currency Translation	(3,749		)	—		—			(3,749		)
Balance at June 30, 2015	$	1,190,230		$	688,366	$	327,315		$	2,205,911

The following table summarizes the intangible assets and their related useful lives recorded in connection with the Catlin Acquisition as of the Acquisition Date:

(U.S. dollars in thousands)	Amount		Estimated Useful Life
Lloyd's - Syndicate capacity	$	660,000	Indefinite
Insurance licenses	13,000		Indefinite
Total identified indefinite life intangible assets	$	673,000
Lloyd's - Managing agent contracts	15,000		15 years
Distribution network	290,000		20 years
Trademarks / Trade names	10,000		2 years
Total identified definite life intangible assets	$	315,000
Total identified intangible assets	$	988,000

An explanation of the intangible assets is as follows:

• Lloyd's - Syndicate capacity - The syndicate capacity of two Lloyd's syndicates, which will allow the Company to write insurance business in the Lloyd's market globally and realize the profits from that business. The value of the syndicate capacity includes the reputational value of participation in the Lloyd's market, and the value of trade names and licenses associated with syndicate ownership.

• Insurance licenses - U.S. State insurance licenses owned by Catlin at the time of Catlin Acquisition.

• Lloyds - Managing agent contracts - As the managing agent for certain Lloyd's syndicates, the Company has contracts with the syndicate members to provide underwriting services, for which it earns managing agent fees and a profit commission.

• Distribution network - A network of hundreds of retail and wholesale brokers worldwide, including specialty and regional brokerages, which allow the Company to form closer relationships with clients and brokers worldwide, which aids business retention.

• Trademarks / Trade names - The Catlin trademarks / trade names are utilized to attract customers for the turnkey solutions provided under the Company's managing agent contracts, and to generate premium from the non-Lloyd's platform underwriting products for which the Catlin brand is known.

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Derivative Instruments - Schedule of settlement of fair value hedges (Details) - Fair value hedges - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Notes Payable And Debt [Member]
Derivative [Line Items]
Cumulative reduction to interest expense	$ 0	$ 20,810
Remaining balance	$ 0	$ 814
Weighted average years remaining to maturity		2 months 12 days
Deposit liabilities
Derivative [Line Items]
Cumulative reduction to interest expense	$ 99,141	$ 90,615
Remaining balance	$ 134,054	$ 142,580
Weighted average years remaining to maturity	22 years 4 months 24 days	24 years

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Investments

6 Months Ended

Jun. 30, 2015

Investments, Debt and Equity Securities [Abstract]

Investments

Investments

(a) Fixed Maturities, Short-Term Investments and Equity Securities

Classification of Fixed Income Securities

During the second quarter of 2014, fixed maturities with a carrying value of $2.8 billion were reclassified from held to maturity ("HTM") to AFS in conjunction with the sale of XLLR, discussed in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary." As a result, the Company no longer holds HTM securities. Gross unrealized gains and gross unrealized losses, net of tax, of $424.9 million and nil, respectively, related to these securities were recognized in other comprehensive income on the date of transfer. For certain annuity contracts that are subject to the Life Retro Arrangements, policy benefit reserves were historically increased for the impact of changes in unrealized gains on investments supporting such contracts as if the gains had been realized, with a corresponding entry to other comprehensive income ("Shadow Adjustments"). In conjunction with the sale of XLLR and the related reclassification of securities from HTM to AFS, the Company recorded an additional gross charge of $440.5 million, net of tax, as a reduction of comprehensive income for such Shadow Adjustments on the date of the transfer. See Note 15, "Accumulated Other Comprehensive Income (Loss)," for further information.

All of the reclassified securities are included within the Life Funds Withheld Assets, along with certain other available for sale securities as defined in the sale and purchase agreement relating to the sale of XLLR. The Life Funds Withheld Assets are managed pursuant to agreed investment guidelines that meet the contractual commitments of the XL ceding companies and applicable laws and regulations. All of the investment results associated with the Life Funds Withheld Assets ultimately accrue to GCLR. Because the Company no longer shares in the risks and rewards of the underlying performance of the Life Funds Withheld Assets, disclosures within the financial statements and accompanying notes included herein separate the Life Funds Withheld Assets from the rest of the Company's investments.

Amortized Cost and Fair Value Summary

The cost (amortized cost for fixed maturities and short-term investments), fair value, gross unrealized gains and gross unrealized (losses), including non-credit related OTTI recorded in accumulated other comprehensive income ("AOCI"), of the Company’s AFS investments as of June 30, 2015 and December 31, 2014, were as follows:

June 30, 2015 (U.S. dollars in thousands)	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Non-credit Related OTTI (1)
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	3,786,878	$	56,994	$	(16,766	)	$	3,827,106	$	—
Corporate - Financials	3,194,676		61,404		(20,567		)	3,235,513		—
Corporate - Non Financials (2)	6,792,840		209,968		(50,744		)	6,952,064		(3,309		)
RMBS – Agency	3,890,265		88,699		(20,820		)	3,958,144		—
RMBS – Non-Agency	361,661		28,531		(17,921		)	372,271		(57,074		)
CMBS	929,466		14,903		(8,311		)	936,058		(1,598		)
CDO	505,865		6,733		(24,573		)	488,025		(1,625		)
Other asset-backed securities (2)	2,326,633		35,669		(11,915		)	2,350,387		(1,516		)
U.S. States and political subdivisions of the States	2,301,628		101,435		(11,790		)	2,391,273		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	5,220,879		111,046		(71,863		)	5,260,062		—
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	29,310,791	$	715,382	$	(255,270	)	$	29,770,903	$	(65,122	)
Total short-term investments - Excluding Life Funds Withheld Assets	$	806,990	$	1,190	$	(694	)	$	807,486	$	—
Total equity securities - Excluding Life Funds Withheld Assets	$	964,038	$	136,219	$	(26,787	)	$	1,073,470	$	—
Total investments - AFS - Excluding Life Funds Withheld Assets	$	31,081,819	$	852,791	$	(282,751	)	$	31,651,859	$	(65,122	)
Fixed maturities - AFS - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	11,501	$	2,177	$	—		$	13,678	$	—
Corporate - Financials	639,699		83,223		—			722,922		—
Corporate - Non Financials	1,439,134		226,544		—			1,665,678		—
RMBS – Agency	674		163		—			837		—
RMBS – Non-Agency	26,377		3,214		—			29,591		—
CMBS	126,539		19,078		—			145,617		—
Other asset-backed securities	164,779		22,758		—			187,537		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	980,215		251,013		—			1,231,228		—
Total fixed maturities - AFS - Life Funds Withheld Assets	$	3,388,918	$	608,170	$	—		$	3,997,088	$	—
Total investments - AFS	$	34,470,737	$	1,460,961	$	(282,751	)	$	35,648,947	$	(65,122	)
Fixed maturities - Trading - Life Funds Withheld Assets								Amortized Cost		Fair Value
U.S. Government and Government-Related/Supported								$	3,628	$	3,596
Corporate - Financials								194,385		187,169
Corporate - Non Financials								343,658		332,654
CMBS								262		261
Other asset-backed securities								15,016		14,823
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported								254,100		252,981
Total investments - Trading - Life Funds Withheld Assets								$	811,049	$	791,484

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(1) Represents the non-credit component of OTTI losses, adjusted for subsequent sales of securities. It does not include the change in fair value subsequent to the date an impairment was recorded.

(2) Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $75.3 million and an amortized cost of $64.5 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

December 31, 2014 (U.S. dollars in thousands)	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Non-credit Related OTTI (1)
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	2,100,851	$	77,889	$	(6,787	)	$	2,171,953	$	—
Corporate - Financials	2,687,797		87,058		(12,939		)	2,761,916		—
Corporate - Non Financials (2)	5,774,333		278,747		(36,623		)	6,016,457		(3,309		)
RMBS – Agency	3,625,171		114,188		(10,783		)	3,728,576		—
RMBS – Non-Agency	404,398		41,108		(18,155		)	427,351		(67,918		)
CMBS	1,033,819		23,987		(5,262		)	1,052,544		(2,033		)
CDO	717,544		1,659		(27,169		)	692,034		(1,663		)
Other asset-backed securities (2)	1,028,528		42,810		(6,045		)	1,065,293		(1,797		)
U.S. States and political subdivisions of the States	1,892,566		129,910		(1,204		)	2,021,272		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	4,162,425		139,484		(61,836		)	4,240,073		—
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	23,427,432	$	936,840	$	(186,803	)	$	24,177,469	$	(76,720	)
Total short-term investments - Excluding Life Funds Withheld Assets	$	257,221	$	49	$	(543	)	$	256,727	$	—
Total equity securities - Excluding Life Funds Withheld Assets	$	763,833	$	130,689	$	(26,230	)	$	868,292	$	—
Total investments - AFS - Excluding Life Funds Withheld Assets	$	24,448,486	$	1,067,578	$	(213,576	)	$	25,302,488	$	(76,720	)
Fixed maturities - AFS - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	14,866	$	3,858	$	—		$	18,724	$	—
Corporate - Financials	701,587		99,432		—			801,019		—
Corporate - Non Financials	1,706,262		310,699		—			2,016,961		—
RMBS – Agency	3,301		481		—			3,782		—
RMBS – Non-Agency	71,075		14,260		—			85,335		—
CMBS	168,886		24,281		—			193,167		—
Other asset-backed securities	238,168		35,373		—			273,541		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	1,397,194		391,842		—			1,789,036		—
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	4,301,339	$	880,226	$	—		$	5,181,565	$	—
Total investments - AFS	$	28,749,825	$	1,947,804	$	(213,576	)	$	30,484,053	$	(76,720	)
Fixed maturities - Trading - Life Funds Withheld Assets								Amortized Cost		Fair Value
Corporate - Non Financials								$	1,180	$	1,171
Total investments - Trading - Life Funds Withheld Assets								$	1,180	$	1,171

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(1) Represents the non-credit component of OTTI losses, adjusted for subsequent sales of securities. It does not include the change in fair value subsequent to the date an impairment was recorded.

(2) Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $79.9 million and an amortized cost of $68.4 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

As of June 30, 2015 and December 31, 2014, approximately 2.5% and 3.0%, respectively, of the Company's fixed income investment portfolio at fair value, excluding Life Funds Withheld Assets, was invested in securities that were below investment grade or not rated. Approximately 14.8% and 24.9% of the gross unrealized losses in the Company's fixed income investment portfolio, excluding Life Funds Withheld Assets, as of June 30, 2015 and December 31, 2014, respectively, related to securities that were below investment grade or not rated.

Contractual Maturities Summary

The contractual maturities of AFS fixed income securities at June 30, 2015 and December 31, 2014 are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	June 30, 2015				December 31, 2014
(U.S. dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
Due less than one year	$	1,957,896	$	1,962,391	$	1,972,224	$	1,980,429
Due after 1 through 5 years	12,409,937		12,584,530		8,919,037		9,113,651
Due after 5 through 10 years	5,231,268		5,305,166		4,232,396		4,412,569
Due after 10 years	1,697,800		1,813,931		1,494,315		1,705,022
	$	21,296,901	$	21,666,018	$	16,617,972	$	17,211,671
RMBS – Agency	3,890,265		3,958,144		3,625,171		3,728,576
RMBS – Non-Agency	361,661		372,271		404,398		427,351
CMBS	929,466		936,058		1,033,819		1,052,544
CDO	505,865		488,025		717,544		692,034
Other asset-backed securities	2,326,633		2,350,387		1,028,528		1,065,293
Total mortgage and asset-backed securities	$	8,013,890	$	8,104,885	$	6,809,460	$	6,965,798
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	29,310,791	$	29,770,903	$	23,427,432	$	24,177,469
Fixed maturities - AFS - Life Funds Withheld Assets
Due less than one year	$	87,963	$	96,402	$	117,048	$	125,326
Due after 1 through 5 years	468,476		505,063		638,526		685,787
Due after 5 through 10 years	705,507		808,909		1,004,698		1,165,348
Due after 10 years	1,808,603		2,223,132		2,059,637		2,649,279
	$	3,070,549	$	3,633,506	$	3,819,909	$	4,625,740
RMBS – Agency	674		837		3,301		3,782
RMBS – Non-Agency	26,377		29,591		71,075		85,335
CMBS	126,539		145,617		168,886		193,167
Other asset-backed securities	164,779		187,537		238,168		273,541
Total mortgage and asset-backed securities	$	318,369	$	363,582	$	481,430	$	555,825
Total fixed maturities - AFS - Life Funds Withheld Assets	$	3,388,918	$	3,997,088	$	4,301,339	$	5,181,565
Total fixed maturities - AFS	$	32,699,709	$	33,767,991	$	27,728,771	$	29,359,034
Fixed maturities - Trading - Life Funds Withheld Assets
Due less than one year	$	42,557	$	42,553	$	—	$	—
Due after 1 through 5 years	221,522		220,727		—		—
Due after 5 through 10 years	162,877		160,923		1,180		1,171
Due after 10 years	368,815		352,197		—		—
	$	795,771	$	776,400	$	1,180	$	1,171
CMBS	262		261		—		—
Other asset-backed securities	15,016		14,823		—		—
Total mortgage and asset-backed securities	$	15,278	$	15,084	$	—	$	—
Total fixed maturities - Trading - Life Funds Withheld Assets	$	811,049	$	791,484	$	1,180	$	1,171

OTTI Considerations

Under final authoritative accounting guidance, a debt security for which amortized cost exceeds fair value is deemed to be other-than-temporarily impaired if it meets either of the following conditions: (a) the Company intends to sell, or it is more likely than not that the Company will be required to sell, the security before a recovery in value, or (b) the Company does not expect to recover the entire amortized cost basis of the security. Other than in a situation in which the Company has the intent to sell a debt security or more likely than not will be required to sell a debt security, the amount of the OTTI related to a credit loss on the security is recognized in earnings, and the amount of the OTTI related to other factors (e.g., interest rates, market conditions, etc.) is recorded as a component of OCI. The net amount recognized in earnings ("credit loss impairment") represents the difference between the amortized cost of the security and the net present value of its projected future cash flows discounted at the effective interest rate implicit in the debt security prior to impairment ("NPV"). The remaining difference between the security's NPV and its fair value is recognized in OCI. Subsequent changes in the fair value of these securities are included in OCI unless a further impairment is deemed to have occurred.

In the scenario where the Company has the intent to sell a security in which its amortized cost exceeds its fair value, or it is more likely than not that it will be required to sell such a security, the entire difference between the security's amortized cost and its fair value is recognized in earnings.

The determination of credit loss impairment is based on detailed analyses of underlying cash flows and other considerations. Such analyses require the use of certain assumptions to develop the estimated performance of underlying collateral. Key assumptions used include, but are not limited to, items such as RMBS default rates based on collateral duration in arrears, severity of losses on default by collateral class, collateral reinvestment rates and expected future general corporate default rates.

Factors considered for all securities on a quarterly basis in determining that a gross unrealized loss is not other-than-temporarily impaired include management's consideration of current and near term liquidity needs and other available sources of funds, an evaluation of the factors and time necessary for recovery and an assessment of whether the Company has the intention to sell or considers it more likely than not that it will be forced to sell a security.

Pledged Assets

Certain of the Company's invested assets are held in trust and pledged in support of insurance and reinsurance liabilities as well as credit facilities. Such pledges are largely required by the Company's operating subsidiaries that are "non-admitted" under U.S. state insurance regulations, in order for the U.S. cedant to receive statutory credit for reinsurance. Also included are Life Funds Withheld Assets as noted in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary." Additionally, certain deposit liabilities and annuity contracts require the use of pledged assets. As of June 30, 2015 and December 31, 2014, the Company had $18.4 billion and $15.2 billion in pledged assets, respectively.

(b) Gross Unrealized Losses

The following is an analysis of how long the AFS securities as of June 30, 2015 and December 31, 2014 had been in a continual unrealized loss position:

	Less than 12 months					Equal to or greater than 12 months
June 30, 2015 (U.S. dollars in thousands)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Fixed maturities and short-term investments - AFS
U.S. Government and Government-Related/Supported	$	1,721,385	$	(12,211	)	$	109,027	$	(4,666	)
Corporate – Financials	1,054,854		(13,737		)	76,450		(6,846		)
Corporate – Non Financials	2,305,696		(41,526		)	146,220		(9,582		)
RMBS – Agency	1,136,559		(12,171		)	245,806		(8,649		)
RMBS – Non-Agency	45,052		(1,959		)	197,361		(15,962		)
CMBS	295,914		(5,263		)	100,100		(3,048		)
CDO	39,969		(5,506		)	322,684		(19,067		)
Other asset-backed securities	1,014,257		(6,535		)	59,985		(5,392		)
U.S. States and political subdivisions of the States	706,360		(10,617		)	17,546		(1,181		)
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	1,736,079		(38,213		)	459,362		(33,833		)
Total fixed maturities and short-term investments - AFS	$	10,056,125	$	(147,738	)	$	1,734,541	$	(108,226	)
Total equity securities	$	267,759	$	(26,787	)	$	—	$	—

	Less than 12 months					Equal to or greater than 12 months
December 31, 2014 (U.S. dollars in thousands)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Fixed maturities and short-term investments - AFS
U.S. Government and Government-Related/Supported	$	251,091	$	(1,196	)	$	342,890	$	(5,603	)
Corporate – Financials	387,619		(5,858		)	105,155		(7,097		)
Corporate – Non Financials	949,851		(28,023		)	319,066		(8,657		)
RMBS – Agency	134,535		(220		)	512,652		(10,563		)
RMBS – Non-Agency	45,378		(1,358		)	202,700		(16,797		)
CMBS	78,356		(385		)	169,065		(4,877		)
CDO	249,803		(2,666		)	414,516		(24,503		)
Other asset-backed securities	143,044		(2,813		)	57,544		(3,232		)
U.S. States and political subdivisions of the States	32,187		(210		)	63,695		(994		)
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	624,346		(19,043		)	558,422		(43,251		)
Total fixed maturities and short-term investments - AFS	$	2,896,210	$	(61,772	)	$	2,745,705	$	(125,574	)
Total equity securities	$	191,193	$	(26,230	)	$	—	$	—

The Company had gross unrealized losses totaling $282.8 million on 2,944 securities out of a total of 8,969 held as of June 30, 2015 in its AFS - Excluding Life Funds Withheld Assets portfolio, which either it considers to be temporarily impaired or with respect to which it reflects non-credit losses on other-than-temporarily impaired assets. Individual security positions comprising this balance have been evaluated by management to determine the severity of these impairments and whether they should be considered other-than-temporary. Management believes it is more likely than not that the issuer will be able to fund sufficient principal and interest payments to support the current amortized cost.

Management, in its assessment of whether securities in a gross unrealized loss position are temporarily impaired, as described above, considers the significance of the impairments. As of June 30, 2015, the AFS - Excluding Life Funds Withheld Assets portfolio included structured credit securities with gross unrealized losses of $8.8 million, which had a fair value of $6.9 million, and a cumulative fair value decline of greater than 50% of amortized cost. All of these securities are mortgage and asset-backed securities.

(c) Net Realized Gains (Losses)

The following represents an analysis of net realized gains (losses) on investments:

Net Realized Gains (Losses) on Investments	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets:
Gross realized gains	$	48,547		$	118,947		$	110,845		$	170,160
Gross realized losses on investments sold	(27,608		)	(13,487		)	(74,728		)	(41,744		)
OTTI on investments, net of amounts transferred to other comprehensive income	(16,588		)	(24,616		)	(27,164		)	(28,343		)
	$	4,351		$	80,844		$	8,953		$	100,073
Net realized gains (losses) on investments and net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets:
Gross realized gains	$	84,641		$	624		$	137,769		$	624
Gross realized losses on investments sold	(16,604		)	—			(16,994		)	—
OTTI on investments, net of amounts transferred to other comprehensive income	(2,878		)	(8,771		)	(8,087		)	(8,771		)
Net unrealized gains (losses) on trading securities	$	(19,543	)	$	—		$	(18,783	)	$	—
	$	45,616		$	(8,147	)	$	93,905		$	(8,147	)
Total net realized gains (losses) on investments	$	49,967		$	72,697		$	102,858		$	91,926

The significant components of the net impairment charges of $16.6 million for investments excluding Life Funds Withheld Assets for the three months ended June 30, 2015 were:

▪ $6.5 million related to certain Other Investments that we no longer intend to hold for a period sufficient to recover their fair value to amortized cost.

• $4.8 million related to certain high yield securities which we no longer intend to hold for a period sufficient to recover their fair value to amortized cost.

• $4.0 million related to certain Alternatives that were in a loss position for more than 11 months.

• $0.3 million related to certain equities that were in a loss position for more than 11 months.

• $0.2 million for structured securities, principally non-Agency RMBS, where we determined that the likely recovery on these securities was below the carrying value and, accordingly, recorded an impairment of the securities to the discounted value of the cash flows expected to be received on these securities.

• $0.8 million related to foreign exchange losses.

The following table sets forth the amount of credit loss impairments on fixed income securities held by the Company for which a portion of the OTTI loss was recognized in OCI, as of the dates or for the periods indicated and the corresponding changes in such amounts.

Credit Loss Impairments	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Opening balance as of beginning of indicated period	$	108,458		$	171,382		$	131,942		$	174,805
Credit loss impairment recognized in the current period on securities not previously impaired	—			30			7,560			41
Credit loss impairments previously recognized on securities which matured, paid down, prepaid or were sold during the period	(8,495		)	(3,322		)	(37,034		)	(7,571		)
Credit loss impairments previously recognized on securities impaired to fair value during the period	(2,629		)	—			(2,629		)	—
Additional credit loss impairments recognized in the current period on securities previously impaired	246			892			387			3,153
Accretion of credit loss impairments previously recognized due to an increase in cash flows expected to be collected	(3,361		)	(3,105		)	(6,007		)	(4,551		)
Balance as of June 30,	$	94,219		$	165,877		$	94,219		$	165,877

During the three months ended June 30, 2015 and 2014, the $8.5 million and $3.3 million, respectively, of credit loss impairments previously recognized on securities that matured, or were paid down, prepaid or sold, included $1.7 million and $2.5 million, respectively, of non-Agency RMBS.

During the six months ended June 30, 2015 and 2014 , the $37.0 million and $7.6 million, respectively, credit loss impairments previously recognized on securities that matured, or were paid down, prepaid or sold, included $28.9 million and $5.2 million, respectively, of non-Agency RMBS.

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Derivative Instruments

6 Months Ended

Jun. 30, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

Derivative Instruments

The Company enters into derivative instruments for both risk management and efficient portfolio management. The Company is exposed to potential loss from various market risks, and manages its market risks based on guidelines established by management and the Risk and Finance Committee of the Company's Board of Directors. The Company recognizes all derivatives as either assets or liabilities on the balance sheets and measures those instruments at fair value, with the changes in fair value of derivatives shown in the consolidated statement of income as "Net realized and unrealized gains (losses) on derivative instruments" unless the derivatives are designated as hedging instruments. The accounting for derivatives that are designated as hedging instruments is described in Item 8, Note 2(h), "Significant Accounting Policies - Derivative Instruments," to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014.

The following table summarizes information on the location and gross amounts of derivative fair values contained in the consolidated balance sheets as of June 30, 2015 and December 31, 2014:

	June 30, 2015								December 31, 2014
(U.S. dollars in thousands)	Asset Derivative Notional Amount		Asset Derivative Fair Value (1)		Liability Derivative Notional Amount		Liability Derivative Fair Value (1)		Asset Derivative Notional Amount		Asset Derivative Fair Value (1)		Liability Derivative Notional Amount		Liability Derivative Fair Value (1)
Derivatives designated as hedging instruments:
Foreign exchange contracts	$	1,834,298	$	209,675	$	720,027	$	52,188	$	2,300,609	$	121,862	$	302,211	$	2,936
Total derivatives designated as hedging instruments	$	1,834,298	$	209,675	$	720,027	$	52,188	$	2,300,609	$	121,862	$	302,211	$	2,936
Derivatives not designated as hedging instruments:
Investment Related Derivatives:
Interest rate exposure	$	10,684	$	194	$	33,934	$	44	$	394,597	$	206	$	20,782	$	51
Foreign exchange exposure	301,260		1,628		139,215		3,786		7,385		403		207,182		4,442
Credit exposure	8,963		814		51,614		12,613		2,408		165		14,270		9,836
Financial market exposure	58,875		2,608		34,794		405		46,145		360		33,670		34
Other Non-Investment Derivatives:
Foreign exchange contracts	79,101		164		8,517		527		—		—		81,194		282
Credit exposure	30,281		71		—		—		31,060		60		—		—
Guaranteed minimum income benefit contract	45,006		13,321		45,006		13,321		46,249		13,603		46,249		13,603
Modified coinsurance funds withheld contracts (2)	65,663		—		4,954,481		—		64,947		—		5,401,278		—
Total derivatives not designated as hedging instruments	$	599,833	$	18,800	$	5,267,561	$	30,696	$	592,791	$	14,797	$	5,804,625	$	28,248

____________

(1) Derivative instruments in an asset or liability position are included within Other assets or Other liabilities, respectively, in the balance sheets on a net basis where the Company has both a legal right of offset and the intention to settle the contracts on a net basis.

(2) The fair value movements in derivative assets and liabilities relating to modified coinsurance funds withheld contracts are included within the associated asset or liability at each period end on the face of the balance sheets. Notional amounts associated with reinsurance agreements under which the Company assumes reinsurance risk are recorded as asset derivative notional amounts. Notional amounts associated with the Life Retro Arrangements under which the Company cedes reinsurance risk are recorded as liability derivative notional amounts. Included in the liability derivative notional amount as of June 30, 2015 is the cumulative net realized and unrealized loss on life retrocession embedded derivative of $381.3 million.

The following table summarizes information on the gross and net amounts of derivative fair values and associated collateral received related to derivative assets, or collateral provided related to derivative liabilities, reported in other assets and or other liabilities within our consolidated balance sheets as of June 30, 2015 and December 31, 2014:

							Gross Amounts Not Offset in the Balance Sheets
June 30, 2015 (U.S. dollars in thousands)	Gross Amounts Recognized in the Balance Sheets		Gross Amounts Offset in the Balance Sheets		Net Amounts in the Balance Sheets		Financial Instruments		Cash Collateral		Net Amounts
Derivative Assets	$	228,475	$	3,239	$	225,236	$	—	$	132,050	$	93,186
Derivative Liabilities	$	82,884	$	3,239	$	79,645	$	—	$	—	$	79,645
December 31, 2014 (U.S. dollars in thousands)
Derivative Assets	$	136,659	$	696	$	135,963	$	—	$	78,580	$	57,383
Derivative Liabilities	$	31,184	$	696	$	30,488	$	—	$	—	$	30,488

Derivative instruments in an asset or liability position are included within Other assets or Other liabilities, respectively, in the balance sheets on a net basis where the Company has both a legal right of offset and the intention to settle the contracts on a net basis. The Company often enters into different types of derivative contracts with a single counterparty and these contracts are covered under netting agreements. As of June 30, 2015 and December 31, 2014, the Company held cash collateral related to foreign currency derivative positions and certain other derivative positions of $132.1 million and $78.6 million, respectively. The assets and liabilities related to the net collateral paid or held were recorded as Other assets and Other liabilities within the balance sheets as the collateral and derivative positions are not intended to be settled on a net basis.

(a) Derivative Instruments Designated as Fair Value Hedges

The Company designates certain of its derivative instruments as fair value hedges or cash flow hedges and formally and contemporaneously documents all relationships between the hedging instruments and hedged items and links the hedging derivatives to specific assets and liabilities. The Company assesses the effectiveness of the hedge both at inception and on an on-going basis, and determines whether the hedge is highly effective in offsetting changes in fair value or cash flows of the linked hedged item.

The Company may use foreign exchange contracts to hedge the fair value of certain fixed income securities as well as to hedge certain net investments in foreign operations. In connection with the Catlin Acquisition and the FX Forwards, certain foreign exchange contracts utilized to hedge the fair value of certain net investments in foreign operations were de-designated as hedging instruments up until such time Catlin Acquisition was completed. Thereafter, these foreign exchange contracts were re-designated as hedging instruments.

The following table provides the total impact on earnings relating to derivative instruments formally designated as fair value hedges along with the impacts of the related hedged items for the three and six months ended June 30, 2015 and 2014:

				Hedged Items - Amount of Gain/(Loss) Recognized in Income Attributable to Risk
Derivatives Designated as Fair Value Hedges: Three Months Ended June 30, 2015 (U.S. dollars in thousands)	Gain/(Loss) Recognized in Income on Derivative				Fixed Maturity Investments		Ineffective Portion of Hedging Relationship - Gain/(Loss)
Interest rate exposure	$	—
Foreign exchange exposure	—
Total	$	—			$	—	$	—
Three Months Ended June 30, 2014
(U.S. dollars in thousands)
Interest rate exposure	$	—
Foreign exchange exposure	(9,132		)
Total	$	(9,132	)		$	7,082	$	(2,050	)
Six Months Ended June 30, 2015
(U.S. dollars in thousands)
Interest rate exposure	$	—
Foreign exchange exposure	—
Total	$	—			$	—	$	—
Six Months Ended June 30, 2014
(U.S. dollars in thousands)
Interest rate exposure	$	—
Foreign exchange exposure	(15,663		)
Total	$	(15,663	)		$	15,407	$	(256	)

The gains (losses) recorded on both the derivative instruments and specific items designated as being hedged as part of the fair value hedging relationships outlined above along with any associated ineffectiveness in the relationships are recorded through Net realized and unrealized gains (losses) on derivative instruments in the income statement.

Settlement of Fair Value Hedges

A summary of the fair value hedges that have been settled and their impact on results during the indicated periods as well as the remaining balance of fair value hedges and average years remaining to maturity as of June 30, 2015 and 2014 are shown below:

Settlement of Fair Value Hedges - Summary	Fair Value Hedges - Notes Payable and Debt June 30,				Fair Value Hedges - Deposit Liabilities June 30,
(U.S. dollars in thousands, except years)	2015		2014		2015		2014
Cumulative reduction to interest expense	$	—	$	20,810	$	99,141	$	90,615
Remaining balance	$	—	$	814	$	134,054	$	142,580
Weighted average years remaining to maturity	0.0		0.2		22.4		24.0

During the second quarter of 2014, the Company negotiated the termination of one of its larger structured indemnity contracts. This contract had previously been designated as a fair value hedge that was settled. The remaining fair value adjustment of $47.0 million that was being amortized as a reduction of interest expense over the remaining term of the contract was recorded as an adjustment to interest expense at the termination date. As a result of the termination, a net decrease of $28.7 million was recorded to interest expense reflecting the realization of the remaining balance of the fair value hedge adjustment, partially offset by an accretion rate adjustment due to changes in cash flows.

(b) Derivative Instruments Designated as Hedges of the Net Investment in a Foreign Operation

The Company utilizes foreign exchange contracts to hedge the fair value of certain net investments in foreign operations. During the three and six months ended June 30, 2015 and 2014, the Company entered into foreign exchange contracts that were formally designated as hedges of investments in foreign subsidiaries, the majority of which have functional currencies of either U.K. sterling or the Euro. There was no ineffectiveness in these transactions.

The following table provides the weighted average U.S. dollar equivalent of foreign denominated net assets that were hedged and the resulting derivative gain (loss) that was recorded in the Foreign currency translation adjustment, net of tax, account within AOCI for the three and six months ended June 30, 2015 and 2014:

Derivative Instruments Designated as Hedges of the Net Investment in a Foreign Operation - Summary	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015		2014
Weighted average of U.S. dollar equivalent of foreign denominated net assets	$	1,815,593		$	2,270,090		$	1,222,267	$	2,478,772
Derivative gains (losses) (1)	$	(30,498	)	$	(2,170	)	$	36,272	$	(1,210	)

____________

(1) Derivative gains (losses) from derivative instruments designated as hedges of the net investment in a foreign operation are recorded in the cumulative translation adjustment account within AOCI for each period.    

(c) Derivative Instruments Not Formally Designated As Hedging Instruments

The following table provides the total impact on earnings relating to derivative instruments not formally designated as hedging instruments under authoritative accounting guidance and from the ineffective portion of fair value hedges. The impacts are all recorded through Net realized and unrealized gains (losses) on derivatives in the income statement for the three and six months ended June 30, 2015 and 2014:

Net Realized and Unrealized Gains (Losses) on Derivative Instruments	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Investment Related Derivatives:
Interest rate exposure	$	(6,563	)	$	8,978		$	3,073		$	9,326
Foreign exchange exposure	482			(1,490		)	(880		)	1,798
Credit exposure	(386		)	411			(305		)	7
Financial market exposure	(1,645		)	2,508			1,398			3,378
Financial Operations Derivatives:
Credit exposure	—			447			—			(4,353		)
Other Non-Investment Derivatives:
Foreign exchange contracts	55,372			—			57,431			—
Credit exposure	132			—			1,478			—
Guaranteed minimum income benefit contract	—			633			—			2,257
Modified coinsurance funds withheld contract	1,117			2,162			2,835			1,252
Total gain (loss) recognized in income from derivatives not designated as hedging instruments	$	48,509		$	13,649		$	65,030		$	13,665
Amount of gain (loss) recognized in income from ineffective portion of fair value hedges	—			(2,050		)	—			(256		)
Net realized and unrealized gains (losses) on derivative instruments	$	48,509		$	11,599		$	65,030		$	13,409
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	$	239,174		$	(17,546	)	$	9,807		$	(17,546	)

The Company’s objectives in using these derivatives are explained below.

(d)(i) Investment Related Derivatives

The Company, either directly or through its investment managers, may use derivative instruments within its investment portfolio, including interest rate swaps, inflation swaps, commodity contracts, total return swaps, credit derivatives (single name and index credit default swaps), options, forward contracts and financial futures (foreign exchange, bond and stock index futures), primarily as a means of economically hedging exposures to interest rate, credit spread, equity price changes and foreign currency risk or, in limited instances, for efficient portfolio management. When using cleared (exchange traded) derivatives, the Company is exposed to the credit risk of the applicable clearing house and of the Company's future commissions merchant. When using uncleared (over-the-counter) derivatives, the Company is exposed to credit risk in the event of non-performance by the counterparties under any derivative contracts, although the Company generally seeks to use credit support arrangements with counterparties to help manage this risk.

Investment Related Derivatives – Interest Rate Exposure

The Company utilizes risk management and overlay strategies that incorporate the use of derivative financial instruments, primarily to manage its fixed income portfolio duration and net economic exposure to interest rate risks. The Company may also use interest rate swaps to convert certain liabilities from a fixed rate to a variable rate of interest or to convert a variable rate of interest from one basis to another.

Investment Related Derivatives – Foreign Exchange Exposure

The Company has exposure to foreign currency exchange rate fluctuations through its operations and in its investment portfolio. The Company uses foreign exchange contracts to manage its exposure to the effects of fluctuating foreign currencies on the value of certain of its foreign currency fixed maturities. These contracts are not designated as specific hedges for financial reporting purposes and, therefore, realized and unrealized gains and losses on these contracts are recorded in income in the period in which they occur. These contracts generally have maturities of twelve months or less.

In addition, certain of the Company's investment managers may, subject to investment guidelines, enter into forward contracts.

Investment Related Derivatives – Credit Exposure

Credit derivatives may be purchased within the Company's investment portfolio in the form of single name, basket or index credit default swaps and swaptions, which are used to mitigate credit exposure through a reduction in credit spread duration (i.e., macro credit strategies rather than single-name credit hedging) or exposure to securities of selected issuers, including issuers that are not held in the underlying fixed income portfolio.

Investment Related Derivatives – Financial Market Exposure

Stock index futures may be purchased within the Company's investment portfolio in order to create synthetic equity exposure and to add value to the portfolio with overlay strategies where market inefficiencies are believed to exist. From time to time, the Company may enter into other financial market exposure derivative contracts on various indices including, but not limited to, inflation and commodity contracts.

(d)(ii) Financial Operations Derivatives – Credit Exposure

During the fourth quarter of 2014, the remaining financial operations credit derivative exposure, which was written as part of the Company's previous financial lines business and is outside of the Company's investment portfolio, was terminated. The Company has no continuing financial operations derivative credit exposures.

(d)(iii) Other Non-Investment Derivatives

Foreign Exchange Contracts

On January 9, 2015, the Company entered into the FX Forwards with Morgan Stanley Capital Services LLC and Goldman Sachs International. The purpose of the FX Forwards was to mitigate risk of foreign currency exposure related to the Catlin Acquisition. Following the close of the Catlin Acquisition, the FX Forwards were settled.

In connection with the Catlin Acquisition and the FX Forwards, during the quarter, certain foreign exchange contracts utilized to hedge the fair value of certain net investments in foreign operations were de-designated as hedging instruments.

Credit Exposure

During the year ended December 31, 2014, the Company entered into a non-investment related credit derivative relating to a number of reference pool mortgage tranches associated with actual mortgage loans that were securitized into agency mortgage-backed securities and sold as Structured Agency Credit Risk Notes. As of June 30, 2015, there was no reported event of default on this obligation. As of June 30, 2015 and December 31, 2014, the notional amount outstanding related to the derivative was $30.3 million and $31.1 million, respectively, and the Company had recorded a derivative asset of $0.1 million and $0.1 million, respectively. During the three months ended June 30, 2015, the Company recorded Net realized and unrealized gains of $0.1 million relating to this credit derivative. The credit derivative is recorded at fair value based upon models developed by the Company. Significant unobservable inputs considered in the valuation include the impact of changes in interest rates, future default, delinquency and prepayment rates, credit spreads, changes in credit quality, and other market factors.

Guaranteed Minimum Income Benefit Contract

The Company also has derivatives embedded in certain reinsurance contracts. For a certain life reinsurance contract, the Company pays the ceding company a fixed amount equal to the estimated present value of the excess of the guaranteed benefit over the account balance upon the policyholder's election to take the income benefit. The fair value of this derivative is determined based on the present value of expected cash flows.

Modified Coinsurance and Funds Withheld Contracts

The Company has modified coinsurance and funds withheld reinsurance agreements that provide for a return to be paid to the Company based on a portfolio of fixed income securities. As such, the agreements contain an embedded derivative. The embedded derivative is bifurcated from the funds withheld balance and recorded at fair value with changes in fair value recognized in earnings through Net realized and unrealized gains (losses) on derivative instruments.

Modified Coinsurance Funds Withheld Reinsurance Agreements - Life Retrocession Embedded Derivative

In addition, the Company has entered into Life Retro Arrangements, as described in Note 3(c), "Acquisition and Disposals - Sale of Life Reinsurance Subsidiary." The embedded derivative related to the Life Retro Arrangements is recorded at fair value with changes in fair value recognized in earnings through Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets.

The change in the value of the life retrocession embedded derivative includes the interest income, realized and unrealized gains and losses on Life Funds Withheld Assets and certain related expenses subsequent to May 30, 2014 as follows:

Components of Life Retrocession Embedded Derivative and Derivative Instruments - Life Funds Withheld Assets:	Three months ended June 30,						Six Months Ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Interest income - Life Funds Withheld Assets	$	(47,873	)	(19,944		)	(98,869		)	(19,944		)
Realized and unrealized gains (losses) - Life Funds Withheld Assets	321,038			1,893			168,208			1,893
Other	59			505			155			505
Net realized and unrealized gains (losses) on life retrocession embedded derivative	$	273,224		$	(17,546	)	$	69,494		$	(17,546	)
Net adjustments related to future policy benefit reserves, net of tax	$	(35,929	)	$	—		$	(47,883	)	$	—
Net realized and unrealized gains (losses) on derivative instruments - Life Funds Withheld Assets	$	1,879		$	—		$	(11,804	)	$	—
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	$	239,174		$	(17,546	)	$	9,807		$	(17,546	)

(e) Contingent Credit Features

Certain derivative agreements entered into by the Company or its subsidiaries contain credit rating downgrade provisions that permit early termination of the agreements by the counterparty if collateral is not posted following failure to maintain certain credit ratings from one or more of the principal credit rating agencies. If the Company were required to terminate such agreements early due to a credit rating downgrade, it could potentially be in a net liability position at the time of settlement of such agreements. The aggregate fair value of all derivative agreements containing such rating downgrade provisions that were in a liability position and any collateral posted under these agreements as of June 30, 2015 and December 31, 2014 were as follows:

Contingent Credit Features - Summary: (U.S. dollars in thousands)	June 30, 2015		December 31, 2014
Aggregate fair value of derivative agreements with downgrade provisions in a net liability position	$	21,545	$	5,770
Collateral posted to counterparty	$	12,390	$	—

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Share Capital

6 Months Ended

Jun. 30, 2015

Stockholders' Equity Note [Abstract]

Share Capital

Share Capital

(a) Authorized and Issued

Ordinary Shares

In connection with the Catlin Acquisition described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition," the Company issued 49.9 million ordinary shares to Catlin shareholders, which had an aggregate value as of the Acquisition Date of $1.85 billion.

The following table is a summary of ordinary shares issued and outstanding:

(in thousands)	June 30, 2015		December 31, 2014
Balance – beginning of period	255,183		278,253
Exercise of options	220		424
Net issuance of restricted shares	1,536		1,246
Share buybacks (1)	(2,982	)	(24,740	)
Issue of shares	49,935		—
Balance – end of period	303,892		255,183

____________

(1) Includes share buybacks associated with authorized share buyback programs as well as purchases related to satisfying tax withholding obligations of employees in connection with the vesting of restricted shares granted under the Company's equity compensation programs.

Buybacks of Ordinary Shares

On February 21, 2014, XL-Ireland announced that its Board of Directors approved an increase to the Share Buyback Program, authorizing the purchase of up to $1.0 billion of ordinary shares, which included the amounts that remained under the previous Share Buyback Program. The Company had suspended active share buybacks through the close of the Catlin Acquisition; however, following the close of the Catlin Acquisition, the Company resumed buybacks under the Share Buyback Program. During the three and six months endedJune 30, 2015, the Company purchased and canceled 2.9 million ordinary shares under the Share Buyback Program for $110.0 million. As of June 30, 2015, $157.6 million remained available for purchase under the Share Buyback Program.

Acquisition of Non-controlling Preferred Shares

In connection with the Catlin Acquisition described in Note 3(a), "Acquisition and Disposals - Catlin Acquisition," the Company assumed responsibility for 0.6 million non-cumulative perpetual preferred shares issued by Catlin-Bermuda, par value of $0.01 per share, with liquidation preference of $1,000 per share, plus declared and unpaid dividends ("CICL Prefs"). Dividends at a rate of 7.249 percent on the liquidation preference are payable semi-annually on January 19 and July 19 in arrears as and when declared up to but not including January 2017. Thereafter, if the CICL-Prefs have not yet been redeemed, dividends will be payable quarterly at a rate equal to 2.975 percent plus the three-month LIBOR rate of the liquidation preference. The fair value on the date of Catlin Acquisition was $562.3 million, which was based on the last trade price of the security prior to the Catlin Acquisition.

(b) Stock Plans

The Company's performance incentive programs provide for grants of stock options, restricted stock, equity-classed restricted stock units, liability-classed restricted stock units, performance units and stock appreciation rights. Share-based compensation granted by the Company generally contains a vesting period of three or four years, and certain awards also contain performance conditions. The Company records compensation expense related to each award over its vesting period, incorporating the best estimate of the expected outcome of performance conditions where applicable. Compensation expense is generally recorded on a straight line basis over the vesting period of an award. See Item 8, Note 20, "Share Capital," to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014 for further information on the Company's performance incentive programs and associated accounting.

During the six months ended June 30, 2015, the Company granted approximately 2.0 million stock options with a weighted-average grant date fair value of $6.51 per option. The fair value of the options issued was estimated on the date of grant using the Black-Scholes option pricing model using the following weighted average assumptions:

Dividend yield	2.00	%
Risk free interest rate	1.70	%
Volatility	21.6	%
Expected lives	6.0 years

During the six months ended June 30, 2015, the Company granted approximately 40,570 restricted stock awards to certain employees and directors of the Company and its subsidiaries with an aggregate grant date fair value of approximately $1.5 million. The award recipients generally have the rights and privileges of a shareholder as to the restricted stock, including the right to receive dividends contingent upon the vesting of the restricted stock and the right to vote such restricted stock. The recipients are not entitled to receive delivery of a stock certificate prior to vesting nor may any restricted stock be sold, transferred, pledged, or otherwise disposed of prior to the satisfaction of all vesting requirements.

During the six months ended June 30, 2015, the Company granted approximately 1.5 million equity-classed restricted stock units to certain employees of the Company and its subsidiaries with an aggregate grant date fair value of approximately $55.4 million. Each equity-classed restricted stock unit represents the Company's obligation to deliver to the holder one ordinary share, and grants vest in three equal installments upon the first, second and third anniversaries of the date of grant. Equity-classed restricted stock units are granted at the closing market price on the day of grant and entitle the holder to receive dividends declared and paid in the form of additional ordinary shares contingent upon vesting.

During the six months ended June 30, 2015, the Company granted approximately 2.5 million liability-classed stock units to certain employees of the Company and its subsidiaries with an aggregate grant date fair value of approximately $93.4 million. Each liability-classed restricted stock unit represents the Company's obligation to deliver to the holder a cash payment equivalent to the value of one ordinary share. The grants may vest either in three equal installments upon the first, second and third anniversaries of the date of grant; or in two equal installments upon the first and second anniversaries of the date of grant. Liability-classed restricted stock units are granted at the closing market price on the day of grant and entitle the holder to receive dividends declared and are paid in cash contingent upon vesting.

During the six months ended June 30, 2015, the Company granted approximately 0.8 million performance units (representing a potential maximum share payout of approximately 1.6 million ordinary shares) to certain employees with an aggregate grant date fair value of approximately $28.2 million. The performance units issued in 2015 vest after three years, subject to the achievement of stated market metrics, and entitle the holder to ordinary shares of the Company. Performance units issued prior to 2015 vest subject to the achievement of stated performance metrics. Each grant of performance units has a target number of shares, with final payouts ranging from 0% to 200% of the grant amount depending upon the achievement of stated market metrics along with each employee's continued service through the vesting date. Performance units issued prior to 2015 have a similar range of targeted number of shares, but payouts are dependent upon the achievement of stated performance metrics along with each employee's continued service through the vesting date. Furthermore, performance units granted in the current year are granted at the closing market price on the day of grant and entitle the holder to receive dividends declared and paid in the form of additional ordinary shares contingent upon vesting. There are no dividend rights associated with performance units issued prior to 2015. Performance targets are based on relative and absolute financial performance metrics.

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Derivative Instruments - Summary of contingent credit features (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Derivative [Line Items]
Collateral posted to counterparty	$ 0	$ 0
Contracts with downgrade provisions [Member]
Derivative [Line Items]
Aggregate fair value of derivative agreements with downgrade provisions in a net liability position	21,545	5,770
Collateral posted to counterparty	$ 12,390	$ 0

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Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets Rollforward (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2015 USD ($)
Goodwill
Goodwill, beginning of period	$ 415,936
Goodwill acquired during the period	778,043
Foreign currency translation	(3,749)
Goodwill, end of period	1,190,230
Intangible assets with an indefinite life
Intangible assets with an indefinite life, beginning of period	15,366
Indefinite-lived intangible assets acquired during the period	673,000
Intangible assets with an indefinite life, end of period	688,366
Intangible assets with a definite life
Intangible assets with a definite life, beginning of period	16,650
Finite-lived intangible assets acquired during the period	315,000
Amortization	(4,335)
Intangible assets with a definite life, end of period	327,315
Total
Goodwill and other intangible assets, beginning of period	447,952
Additions	1,766,043
Amortization	(4,335)
Foreign currency translation	(3,749)
Goodwill and other intangible assets, end of period	$ 2,205,911

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Derivative Instruments - Components of life retrocession embedded derivative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Derivative [Line Items]
Net realized and unrealized gains (losses) on derivative instruments	$ 48,509	$ 11,599	$ 65,030	$ 13,409
Life Funds Withheld Assets
Derivative [Line Items]
Net realized and unrealized gains (losses) on life retrocession embedded derivative	273,224	(17,546)	69,494	(17,546)
Net adjustments related to future policy benefit reserves, net of tax	(35,929)		(47,883)
Net realized and unrealized gains (losses) on derivative instruments - Life Funds Withheld Assets	1,879	0	(11,804)	0
Net realized and unrealized gains (losses) on derivative instruments	239,174	(17,546)	9,807	(17,546)
Life Funds Withheld Assets | Interest income
Derivative [Line Items]
Net realized and unrealized gains (losses) on life retrocession embedded derivative	(47,873)	(19,944)	(98,869)	(19,944)
Life Funds Withheld Assets | Net realized and unrealized gains (losses) on derivative instruments
Derivative [Line Items]
Net realized and unrealized gains (losses) on life retrocession embedded derivative	321,038	1,893	168,208	1,893
Life Funds Withheld Assets | Other income
Derivative [Line Items]
Net realized and unrealized gains (losses) on life retrocession embedded derivative	$ 59	505	$ 155	505
Life Funds Withheld Assets | Unrealized gains (losses) on investments
Derivative [Line Items]
Net adjustments related to future policy benefit reserves, net of tax		$ 0		$ 0

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Accumulated Other Comprehensive Income (Loss) (Tables)

6 Months Ended

Jun. 30, 2015

Comprehensive Income Loss Note [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss)

The changes in AOCI, net of tax, by component for the three and six months ended June 30, 2015 and 2014 are as follows:

Three months ended June 30, 2015 (U.S. dollars in thousands)	Unrealized Gains (Losses) on Investments (1)			OTTI Losses Recognized in AOCI			Foreign Currency Translation Adjustments			Underfunded Pension Liability			Cash Flow Hedge		Total
Balance, beginning of period, net of tax	$	1,763,795		$	(66,189	)	$	24,915		$	(19,814	)	$	2,463	$	1,705,170
OCI before reclassifications	(544,273		)	—			(36,362		)	(1,329		)	—		(581,964		)
Amounts reclassified from AOCI	(87,558		)	1,662			—			—			12		(85,884		)
Tax benefit (expense)	37,000			(87		)	1,939			—			—		38,852
Net current period OCI - net of tax	(594,831		)	1,575			(34,423		)	(1,329		)	12		(628,996		)
Balance, end of period, net of tax	$	1,168,964		$	(64,614	)	$	(9,508	)	$	(21,143	)	$	2,475	$	1,076,174
Three months ended June 30, 2014 (U.S. dollars in thousands)
Balance, beginning of period, net of tax	$	1,032,941		$	(85,894	)	$	10,661		$	(13,270	)	$	2,223	$	946,661
OCI before reclassifications	363,348			—			(3,621		)	(8		)	—		359,719
Amounts reclassified from AOCI	(74,337		)	1,640			—			—			110		(72,587		)
Tax benefit (expense)	(20,774		)	(4		)	(5,981		)	—			—		(26,759		)
Net current period OCI - net of tax	268,237			1,636			(9,602		)	(8		)	110		260,373
Balance, end of period, net of tax	$	1,301,178		$	(84,258	)	$	1,059		$	(13,278	)	$	2,333	$	1,207,034
Six months ended June 30, 2015 (U.S. dollars in thousands)
Balance, beginning of period, net of tax	$	1,590,114		$	(76,047	)	$	(11,188	)	$	(20,789	)	$	2,368	$	1,484,458
OCI before reclassifications	(290,007		)	—			(3,958		)	(354		)	—		(294,319		)
Amounts reclassified from AOCI	(162,338		)	11,598			—			—			107		(150,633		)
Tax benefit (expense)	31,195			(165		)	5,638			—			—		36,668
Net current period OCI - net of tax	(421,150		)	11,433			1,680			(354		)	107		(408,284		)
Balance, end of period, net of tax	$	1,168,964		$	(64,614	)	$	(9,508	)	$	(21,143	)	$	2,475	$	1,076,174
Six months ended June 30, 2014 (U.S. dollars in thousands)
Balance, beginning of period, net of tax	$	822,432		$	(89,190	)	$	14,541		$	(13,239	)	$	2,113	$	736,657
OCI before reclassifications	628,599			—			(9,521		)	(39		)	—		619,039
Amounts reclassified from AOCI	(96,975		)	5,049			—			—			220		(91,706		)
Tax benefit (expense)	(52,878		)	(117		)	(3,961		)	—			—		(56,956		)
Net current period OCI - net of tax	478,746			4,932			(13,482		)	(39		)	220		470,377
Balance, end of period, net of tax	$	1,301,178		$	(84,258	)	$	1,059		$	(13,278	)	$	2,333	$	1,207,034

____________

(1) Included in these amounts is the impact of Shadow Adjustments. As of December 31, 2014 the cumulative impact of the Shadow Adjustments was $445.1 million. During the six months ended June 30, 2015, net movements of $(86.7) million were recorded, resulting in a total cumulative net impact of Shadow Adjustments on future policy benefit reserves of $358.4 million as of June 30, 2015.

Reclassification out of Accumulated Other Comprehensive Income

The reclassifications out of AOCI along with the associated income statement line items affected by component, and the total related tax (expense) benefit for the three and six months ended June 30, 2015 and 2014 are as follows:

Gross Amount Reclassified From AOCI
Details About AOCI Components (U.S. dollars in thousands)	Three months ended June 30, 2015			Three months ended June 30, 2014			Six months ended June 30, 2015			Six months ended June 30, 2014			Affected Line Item in the Statement of Income
Unrealized gains and losses on investments:
	$	(71,027	)	$	(107,470	)	$	(149,578	)	$	(132,384	)	Net realized gains (losses) on investments sold and net unrealized gains (losses) on investments Trading
	19,398			33,133			35,122			35,409			OTTI on investments
	$	(35,929	)	$	—		$	(47,882	)	$	—		Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets
	$	(87,558	)	$	(74,337	)	$	(162,338	)	$	(96,975	)	Total before tax
	3,694			3,699			3,781			4,152			Provision (benefit) for income tax
	$	(83,864	)	$	(70,638	)	$	(158,557	)	$	(92,823	)	Net of tax
OTTI losses recognized in OCI:
	$	1,594		$	1,386		$	11,469		$	3,344		Net realized gains (losses) on investments sold
	68			254			129			1,705			OTTI on investments transferred to (from) OCI
	$	1,662		$	1,640		$	11,598		$	5,049		Total before tax
	(12		)	(4		)	(15		)	(117		)	Provision (benefit) for income tax
	$	1,650		$	1,636		$	11,583		$	4,932		Net of tax
Gains and losses on cash flow hedges:
Interest rate contracts	$	12		$	110		$	107		$	220		Interest Expense
	—			—			—			—			Provision (benefit) for income tax
	$	12		$	110		$	107		$	220		Net of tax
Total reclassifications for the period, gross of tax	$	(85,884	)	$	(72,587	)	$	(150,633	)	$	(91,706	)
Tax benefit (expense)	3,682			3,695			3,766			4,035
Total reclassifications for the period, net of tax	$	(82,202	)	$	(68,892	)	$	(146,867	)	$	(87,671	)

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Investments - Cost (amortized cost for fixed maturities and short-term investments), fair value, gross unrealized gains, gross unrealized (losses), and OTTI recorded in AOCI (Details) - USD ($) $ in Thousands		Jun. 30, 2015		Dec. 31, 2014
Trading securities
Amortized cost of fixed maturities, trading		$ 768,492		$ 1,180
Fixed maturities, trading at fair value		748,931		1,171
AFS securities
Amortized cost of fixed maturities		32,699,709		27,728,771
Fixed maturities, at fair value		33,767,991		29,359,034
Non credit-related OTTI	[1]	(65,122)		(76,720)
Amortized cost of short-term investments, available for sale		806,990		257,221
Short-term investments, at fair value		807,486		256,727
Cost of equity securities		964,038		763,833
Equity securities, at fair value		1,073,470		868,292
Available for sale securities, Cost or amortized cost		34,470,737		28,749,825
Available for sale securities, Gross unrealized gains		1,460,961		1,947,804
Available for sale securities, Gross unrealized losses		(282,751)		(213,576)
Total investments available for sale		35,648,947		30,484,053
Excluding Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		29,310,791		23,427,432
Gross unrealized gains on Fixed maturities		715,382		936,840
Gross unrealized losses on Fixed maturities		(255,270)		(186,803)
Fixed maturities, at fair value		29,770,903		24,177,469
Non credit-related OTTI	[1]	(65,122)		(76,720)
Amortized cost of short-term investments, available for sale		806,990		257,221
Short term investments, gross unrealized gains		1,190		49
Short-term investments, gross unrealized losses		(694)		(543)
Short-term investments, at fair value		807,486		256,727
Cost of equity securities		964,038		763,833
Equity securities, gross unrealized gains		136,219		130,689
Equity securities, gross unrealized losses		(26,787)		(26,230)
Equity securities, at fair value		1,073,470		868,292
Available for sale securities, Cost or amortized cost		31,081,819		24,448,486
Available for sale securities, Gross unrealized gains		852,791		1,067,578
Available for sale securities, Gross unrealized losses		(282,751)		(213,576)
Total investments available for sale		31,651,859		25,302,488
Life Funds Withheld Assets
Trading securities
Amortized cost of fixed maturities, trading		811,049		1,180
Fixed maturities, trading at fair value		791,484		1,171
AFS securities
Amortized cost of fixed maturities		3,388,918		4,301,339
Gross unrealized gains on Fixed maturities		608,170		880,226
Gross unrealized losses on Fixed maturities		0		0
Fixed maturities, at fair value		3,997,088		5,181,565
Non credit-related OTTI	[1]	0		0
U.S. Government and Government - Related/Supported | Excluding Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		3,786,878		2,100,851
Gross unrealized gains on Fixed maturities		56,994		77,889
Gross unrealized losses on Fixed maturities		(16,766)		(6,787)
Fixed maturities, at fair value		3,827,106		2,171,953
Non credit-related OTTI	[1]	0		0
U.S. Government and Government - Related/Supported | Life Funds Withheld Assets
Trading securities
Amortized cost of fixed maturities, trading		3,628
Fixed maturities, trading at fair value		3,596
AFS securities
Amortized cost of fixed maturities		11,501		14,866
Gross unrealized gains on Fixed maturities		2,177		3,858
Gross unrealized losses on Fixed maturities		0		0
Fixed maturities, at fair value		13,678		18,724
Non credit-related OTTI	[1]	0		0
RMBS - Agency | Excluding Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		3,890,265		3,625,171
Gross unrealized gains on Fixed maturities		88,699		114,188
Gross unrealized losses on Fixed maturities		(20,820)		(10,783)
Fixed maturities, at fair value		3,958,144		3,728,576
Non credit-related OTTI	[1]	0		0
RMBS - Agency | Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		674		3,301
Gross unrealized gains on Fixed maturities		163		481
Gross unrealized losses on Fixed maturities		0		0
Fixed maturities, at fair value		837		3,782
Non credit-related OTTI	[1]	0		0
RMBS - Non-Agency | Excluding Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		361,661		404,398
Gross unrealized gains on Fixed maturities		28,531		41,108
Gross unrealized losses on Fixed maturities		(17,921)		(18,155)
Fixed maturities, at fair value		372,271		427,351
Non credit-related OTTI	[1]	(57,074)		(67,918)
RMBS - Non-Agency | Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		26,377		71,075
Gross unrealized gains on Fixed maturities		3,214		14,260
Gross unrealized losses on Fixed maturities		0		0
Fixed maturities, at fair value		29,591		85,335
Non credit-related OTTI	[1]	0		0
Commercial mortgage-backed securities | Excluding Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		929,466		1,033,819
Gross unrealized gains on Fixed maturities		14,903		23,987
Gross unrealized losses on Fixed maturities		(8,311)		(5,262)
Fixed maturities, at fair value		936,058		1,052,544
Non credit-related OTTI	[1]	(1,598)		(2,033)
Commercial mortgage-backed securities | Life Funds Withheld Assets
Trading securities
Amortized cost of fixed maturities, trading		262
Fixed maturities, trading at fair value		261
AFS securities
Amortized cost of fixed maturities		126,539		168,886
Gross unrealized gains on Fixed maturities		19,078		24,281
Gross unrealized losses on Fixed maturities		0		0
Fixed maturities, at fair value		145,617		193,167
Non credit-related OTTI	[1]	0		0
Collateralized debt obligations | Excluding Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		505,865		717,544
Gross unrealized gains on Fixed maturities		6,733		1,659
Gross unrealized losses on Fixed maturities		(24,573)		(27,169)
Fixed maturities, at fair value		488,025		692,034
Non credit-related OTTI	[1]	(1,625)		(1,663)
Other asset-backed securities | Excluding Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		2,326,633	[2]	1,028,528	[3]
Gross unrealized gains on Fixed maturities		35,669	[2]	42,810	[3]
Gross unrealized losses on Fixed maturities		(11,915)	[2]	(6,045)	[3]
Fixed maturities, at fair value		2,350,387	[2]	1,065,293	[3]
Non credit-related OTTI	[1]	(1,516)	[2]	(1,797)	[3]
Other asset-backed securities | Life Funds Withheld Assets
Trading securities
Amortized cost of fixed maturities, trading		15,016
Fixed maturities, trading at fair value		14,823
AFS securities
Amortized cost of fixed maturities		164,779		238,168
Gross unrealized gains on Fixed maturities		22,758		35,373
Gross unrealized losses on Fixed maturities		0		0
Fixed maturities, at fair value		187,537		273,541
Non credit-related OTTI	[1]	0		0
US States and political subdivisions of the States | Excluding Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		2,301,628		1,892,566
Gross unrealized gains on Fixed maturities		101,435		129,910
Gross unrealized losses on Fixed maturities		(11,790)		(1,204)
Fixed maturities, at fair value		2,391,273		2,021,272
Non credit-related OTTI	[1]	0		0
Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported | Excluding Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		5,220,879		4,162,425
Gross unrealized gains on Fixed maturities		111,046		139,484
Gross unrealized losses on Fixed maturities		(71,863)		(61,836)
Fixed maturities, at fair value		5,260,062		4,240,073
Non credit-related OTTI	[1]	0		0
Non-U.S. Sovereign Government, Provincial, Supranational, and Government-Related/Supported | Life Funds Withheld Assets
Trading securities
Amortized cost of fixed maturities, trading		254,100
Fixed maturities, trading at fair value		252,981
AFS securities
Amortized cost of fixed maturities		980,215		1,397,194
Gross unrealized gains on Fixed maturities		251,013		391,842
Gross unrealized losses on Fixed maturities		0		0
Fixed maturities, at fair value		1,231,228		1,789,036
Non credit-related OTTI	[1]	0		0
Financial Services Sector [Member] | Corporate | Excluding Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		3,194,676		2,687,797
Gross unrealized gains on Fixed maturities		61,404		87,058
Gross unrealized losses on Fixed maturities		(20,567)		(12,939)
Fixed maturities, at fair value		3,235,513		2,761,916
Non credit-related OTTI	[1]	0		0
Financial Services Sector [Member] | Corporate | Life Funds Withheld Assets
Trading securities
Amortized cost of fixed maturities, trading		194,385
Fixed maturities, trading at fair value		187,169
AFS securities
Amortized cost of fixed maturities		639,699		701,587
Gross unrealized gains on Fixed maturities		83,223		99,432
Gross unrealized losses on Fixed maturities		0		0
Fixed maturities, at fair value		722,922		801,019
Non credit-related OTTI	[1]	0		0
Non-Financial Services Sector [Member] | Corporate | Excluding Life Funds Withheld Assets
AFS securities
Amortized cost of fixed maturities		6,792,840	[2]	5,774,333	[3]
Gross unrealized gains on Fixed maturities		209,968	[2]	278,747	[3]
Gross unrealized losses on Fixed maturities		(50,744)	[2]	(36,623)	[3]
Fixed maturities, at fair value		6,952,064	[2]	6,016,457	[3]
Non credit-related OTTI	[1]	(3,309)	[2]	(3,309)	[3]
Non-Financial Services Sector [Member] | Corporate | Life Funds Withheld Assets
Trading securities
Amortized cost of fixed maturities, trading		343,658		1,180
Fixed maturities, trading at fair value		332,654		1,171
AFS securities
Amortized cost of fixed maturities		1,439,134		1,706,262
Gross unrealized gains on Fixed maturities		226,544		310,699
Gross unrealized losses on Fixed maturities		0		0
Fixed maturities, at fair value		1,665,678		2,016,961
Non credit-related OTTI	[1]	$ 0		$ 0

[1] Represents the non-credit component of OTTI losses, adjusted for subsequent sales of securities. It does not include the change in fair value subsequent to the date an impairment was recorded.

[2] Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $75.3 million and an amortized cost of $64.5 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

[3] Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $79.9 million and an amortized cost of $68.4 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

(a) Financial Guarantee Exposures

The Company's outstanding financial guarantee contracts as of June 30, 2015 provide credit support for a variety of collateral types with the exposures comprised of an aggregate amount of $80.8 million notional financial guarantee on two notes backed by zero coupon long dated bonds and bank perpetual securities, including some issued by European financial institutions. As of June 30, 2015 and December 31, 2014, the total gross claim liability recorded was nil and the contracts had a weighted average contractual term to maturity of 24.7 years and 25.2 years, respectively.

Surveillance procedures to track and monitor credit deteriorations in the insured financial obligations are performed by the primary obligors for each transaction on the Company's behalf. Information regarding the performance status and updated exposure values is provided to the Company on a quarterly basis and evaluated by management in recording claims reserves. As of June 30, 2015, there were no reported events of default on these obligations.

(b) Litigation

The Company and its subsidiaries are subject to litigation and arbitration in the normal course of business. These lawsuits and arbitrations principally involve claims on policies of insurance and contracts of reinsurance and are typical for the Company and for the property and casualty insurance and reinsurance industry in general. Such claims proceedings are considered in connection with the Company's loss and loss expense reserves. Reserves in varying amounts may or may not be established in respect of particular claims proceedings based on many factors, including the legal merits thereof. In addition to litigation relating to insurance and reinsurance claims, the Company and its subsidiaries are subject to lawsuits and regulatory actions in the normal course of business that do not arise from or directly relate to claims on insurance or reinsurance policies. This category of business litigation typically involves, among other things, allegations of underwriting errors or misconduct, employment claims, regulatory activity, shareholder disputes or disputes arising from business ventures. The status of these legal actions is actively monitored by management.

Legal actions are subject to inherent uncertainties, and future events could change management's assessment of the probability or estimated amount of potential losses from pending or threatened legal actions. Based on available information, it is the opinion of management that the ultimate resolution of pending or threatened legal actions other than claims proceedings, both individually and in the aggregate, will not result in losses having a material adverse effect on the Company's financial position or liquidity as of June 30, 2015.

If management believes that, based on available information, it is at least reasonably possible that a material loss (or additional material loss in excess of any accrual) will be incurred in connection with any legal actions, the Company discloses an estimate of the possible loss or range of loss, either individually or in the aggregate, as appropriate, if such an estimate can be made, or discloses that an estimate cannot be made. Based on the Company's assessment as of June 30, 2015, no such disclosures were considered necessary.

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

Schedule of segment reporting, by segment

The following tables summarize the segment results for the three and six months ended June 30, 2015 and 2014:

Three Months Ended June 30, 2015 (U.S. dollars in thousands, except ratios)	Insurance			Reinsurance			Total P&C			Corporate and Other (1)			Total
Gross premiums written	$	2,219,444		$	782,248		$	3,001,692		$	79,443		$	3,081,135
Net premiums written	1,401,772			698,301			2,100,073			18,258			2,118,331
Net premiums earned	1,412,906			650,889			2,063,795			18,258			2,082,053
Net losses and loss expenses (2)	896,370			254,825			1,151,195			22,081			1,173,276
Acquisition costs (2)	181,716			158,217			339,933			1,684			341,617
Operating expenses (3)	292,161			71,727			363,888			(59		)	363,829
Underwriting profit (loss)	$	42,659		$	166,120		$	208,779		$	(5,448	)	$	203,331
Net investment income - excluding Life Funds Withheld Assets (4)							149,461			10,831			160,292
Net investment income - Life Funds Withheld Assets										46,864			46,864
Net results from structured products (5)	3,401			1,856			5,257			—			5,257
Net fee income and other (6)	(2,033		)	623			(1,410		)	46			(1,364		)
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets							4,223			128			4,351
Net realized gains (losses) on investments and net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets							—			45,616			45,616
Net realized and unrealized gains (losses) on derivative instruments							—			48,509			48,509
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets							—			239,174			239,174
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			40,839			40,839
Gain on sale of operating affiliate							—			340,407			340,407
Exchange (gains) losses							—			10,374			10,374
Corporate operating expenses							—			130,987			130,987
Contribution from P&C and Corporate and Other							366,310			625,605			991,915
Interest expense (8)										39,038			39,038
Non-controlling interests										4,879			4,879
Income tax expense										32,959			32,959
Net income (loss) attributable to ordinary shareholders													$	915,039
Ratios – P&C operations: (9)
Loss and loss expense ratio	63.4		%	39.2		%	55.8		%
Underwriting expense ratio	33.6		%	35.3		%	34.1		%
Combined ratio	97.0		%	74.5		%	89.9		%

____________

(1) Corporate and Other includes other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest expense of $16.0 million and $10.6 million, respectively.

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

(7) The Company generally 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.

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

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

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 (2)	627,627			200,253			827,880			85,299			913,179
Acquisition costs (2)	99,863			80,874			180,737			3,882			184,619
Operating expenses (3)	213,930			47,582			261,512			2,209			263,721
Underwriting profit (loss)	$	62,570		$	105,377		$	167,947		$	(32,872	)	$	135,075
Net investment income - excluding Life Funds Withheld Assets (4)							144,555			52,118			196,673
Net investment income - Life Funds Withheld Assets										19,165			19,165
Net results from structured products (5)	31,645			3,240			34,885			—			34,885
Net fee income and other (6)	(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 and net unrealized gains (losses) on investments, Trading - 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 and derivative instruments - Life Funds Withheld Assets							—			(17,546		)	(17,546		)
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			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							422,989			(671,937		)	(248,948		)
Interest expense (8)										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													$	(279,260	)
Ratios – P&C operations: (9)
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 other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest credit of $16.9 million and $18.2 million, respectively.

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

(7) The Company generally 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.

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

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

Six Months Ended June 30, 2015 (U.S. dollars in thousands, except ratios)	Insurance			Reinsurance			Total P&C			Corporate and Other (1)			Total
Gross premiums written	$	3,874,191		$	1,607,910		$	5,482,101		$	154,394		$	5,636,495
Net premiums written	2,490,880			1,445,936			3,936,816			32,764			3,969,580
Net premiums earned	2,375,212			1,008,077			3,383,289			32,764			3,416,053
Net losses and loss expenses (2)	1,513,317			407,705			1,921,022			41,468			1,962,490
Acquisition costs (2)	262,103			229,709			491,812			3,501			495,313
Operating expenses (3)	500,618			114,222			614,840			872			615,712
Underwriting profit (loss)	$	99,174		$	256,441		$	355,615		$	(13,077	)	$	342,538
Net investment income - excluding Life Funds Withheld Assets (4)							282,269			21,041			303,310
Net investment income - Life Funds Withheld Assets										97,283			97,283
Net results from structured products (5)	6,306			3,976			10,282			—			10,282
Net fee income and other (6)	(9,498		)	1,448			(8,050		)	178			(7,872		)
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets							10,030			(1,077		)	8,953
Net realized gains (losses) on investments and net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets							—			93,905			93,905
Net realized and unrealized gains (losses) on derivative instruments							—			65,030			65,030
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets							—			9,807			9,807
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			98,836			98,836
Gain on sale of operating affiliate										340,407			340,407
Exchange (gains) losses							—			37,764			37,764
Corporate operating expenses							—			193,430			193,430
Contribution from P&C and Corporate and Other							650,146			481,139			1,131,285
Interest expense (8)										80,519			80,519
Non-controlling interests										42,269			42,269
Income tax expense										57,177			57,177
Net income (loss) attributable to ordinary shareholders													$	951,320
Ratios – P&C operations: (9)
Loss and loss expense ratio	63.7		%	40.4		%	56.8		%
Underwriting expense ratio	32.1		%	34.2		%	32.7		%
Combined ratio	95.8		%	74.6		%	89.5		%

____________

(1) Corporate and Other includes other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest expense of $31.1 million and $20.6 million, respectively.

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

(7) The Company generally 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.

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

(9) 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 (2)	1,266,820			392,565			1,659,385			198,886			1,858,271
Acquisition costs (2)	204,863			168,109			372,972			11,061			384,033
Operating expenses (3)	416,983			88,443			505,426			5,397			510,823
Underwriting profit (loss)	$	107,764		$	205,057		$	312,821		$	(80,515	)	$	232,306
Net investment income - excluding Life Funds Withheld Assets (4)							288,082			123,010			411,092
Net investment income - Life Funds Withheld Assets										19,165			19,165
Net results from structured products (5)	36,535			6,303			42,838			—			42,838
Net fee income and other (6)	(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 and net unrealized gains (losses) on investments, Trading - 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 and derivative instruments - Life Funds Withheld Assets							—			(17,546		)	(17,546		)
Net income (loss) from investment fund affiliates and operating affiliates (7)							—			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							736,470			(627,461		)	109,009
Interest expense (8)										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													$	(23,543	)
Ratios – P&C operations: (9)
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 other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

(2) The Company has reflected the amortization of certain fair value adjustments recorded in conjunction with the Catlin Acquisition within the respective segments.

(3) Operating expenses of the segments exclude Corporate operating expenses, shown separately.

(4) Net investment income - excluding Life Funds Withheld Assets does not include net investment income related to the net results from structured products.

(5) The net results from P&C structured products include net investment income and interest credit of $35.7 million and $7.4 million, respectively.

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

(7) The Company generally 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.

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

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

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 and six months ended June 30, 2015 and 2014:

Three Months Ended June 30, 2015 (U.S. dollars in thousands)	Insurance			Reinsurance		Corporate and Other		Total
P&C Operations:
Professional	$	286,348		$	43,225	$	—	$	329,573
Casualty	420,472			125,787		—		546,259
Property catastrophe	—			163,453		—		163,453
Property	215,128			231,897		—		447,025
Marine, energy, aviation and satellite	(16		)	32,549		—		32,533
Specialty	411,438			—		—		411,438
Other (1)	79,536			53,978		—		133,514
Total P&C Operations	$	1,412,906		$	650,889	$	—	$	2,063,795
Corporate and Other:
Run-off Life operations - Annuity	$	—		$	—	$	1	$	1
Run-off Life operations - Other Life	—			—		18,257		18,257
Total Corporate and Other	$	—		$	—	$	18,258	$	18,258
Total	$	1,412,906		$	650,889	$	18,258	$	2,082,053
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	$	—		$	—	$	21,564	$	21,564
Run-off Life operations - Other Life	—			—		36,954		36,954
Total Corporate and Other	$	—		$	—	$	58,518	$	58,518
Total	$	1,003,990		$	434,086	$	58,518	$	1,496,594

____________

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

Six Months Ended June 30, 2015 (U.S. dollars in thousands)	Insurance			Reinsurance		Corporate and Other		Total
P&C Operations:
Professional	$	552,759		$	78,233	$	—	$	630,992
Casualty	729,807			183,995		—		913,802
Property catastrophe	—			257,526		—		257,526
Property	343,369			363,121		—		706,490
Marine, energy, aviation and satellite	(16		)	50,624		—		50,608
Specialty	596,162			—		—		596,162
Other (1)	153,131			74,578		—		227,709
Total P&C Operations	$	2,375,212		$	1,008,077	$	—	$	3,383,289
Corporate and Other:
Run-off Life operations - Annuity	$	—		$	—	$	—	$	—
Run-off Life operations - Other Life	—			—		32,764		32,764
Total Corporate and Other	$	—		$	—	$	32,764	$	32,764
Total	$	2,375,212		$	1,008,077	$	32,764	$	3,416,053
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	$	—		$	—	$	53,361	$	53,361
Run-off Life operations - Other Life	—			—		81,468		81,468
Total Corporate and Other	$	—		$	—	$	134,829	$	134,829
Total	$	1,996,430		$	854,174	$	134,829	$	2,985,433

____________

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

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Segment Information - Net Premiums Earned by Line of Business (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Net premiums earned by line of business:
P&C Operations		$ 2,063,795	$ 1,438,076	$ 3,383,289	$ 2,850,604
Life Operations		18,258	58,518	32,764	134,829
Total		2,082,053	1,496,594	3,416,053	2,985,433
Corporate and Other
Net premiums earned by line of business:
Life Operations		18,258	58,518	32,764	134,829
Total	[1]	18,258	58,518	32,764	134,829
Professional | Total P&C
Net premiums earned by line of business:
P&C Operations		329,573	311,748	630,992	637,279
Casualty | Total P&C
Net premiums earned by line of business:
P&C Operations		546,259	441,919	913,802	862,644
Property catastrophe | Total P&C
Net premiums earned by line of business:
P&C Operations		163,453	112,562	257,526	220,999
Property | Total P&C
Net premiums earned by line of business:
P&C Operations		447,025	285,211	706,490	560,183
Marine, energy, aviation and satellite | Total P&C
Net premiums earned by line of business:
P&C Operations		32,533	21,065	50,608	44,579
Specialty | Total P&C
Net premiums earned by line of business:
P&C Operations		411,438	179,948	596,162	356,857
Other | Total P&C
Net premiums earned by line of business:
P&C Operations	[2]	133,514	85,623	227,709	168,063
Annuity
Net premiums earned by line of business:
Life Operations		1	21,564	0	53,361
Annuity | Corporate and Other
Net premiums earned by line of business:
Life Operations		1	21,564	0	53,361
Other life
Net premiums earned by line of business:
Life Operations		18,257	36,954	32,764	81,468
Other life | Corporate and Other
Net premiums earned by line of business:
Life Operations		18,257	36,954	32,764	81,468
Operating Segments [Member] | Total P&C
Net premiums earned by line of business:
Total		2,063,795	1,438,076	3,383,289	2,850,604
Operating Segments [Member] | Insurance Segment
Net premiums earned by line of business:
P&C Operations		1,412,906	1,003,990	2,375,212	1,996,430
Total		1,412,906	1,003,990	2,375,212	1,996,430
Operating Segments [Member] | Reinsurance Segment
Net premiums earned by line of business:
P&C Operations		650,889	434,086	1,008,077	854,174
Total		650,889	434,086	1,008,077	854,174
Operating Segments [Member] | Professional | Insurance Segment
Net premiums earned by line of business:
P&C Operations		286,348	267,509	552,759	542,936
Operating Segments [Member] | Professional | Reinsurance Segment
Net premiums earned by line of business:
P&C Operations		43,225	44,239	78,233	94,343
Operating Segments [Member] | Casualty | Insurance Segment
Net premiums earned by line of business:
P&C Operations		420,472	358,990	729,807	702,994
Operating Segments [Member] | Casualty | Reinsurance Segment
Net premiums earned by line of business:
P&C Operations		125,787	82,929	183,995	159,650
Operating Segments [Member] | Property catastrophe | Insurance Segment
Net premiums earned by line of business:
P&C Operations		0	0	0	0
Operating Segments [Member] | Property catastrophe | Reinsurance Segment
Net premiums earned by line of business:
P&C Operations		163,453	112,562	257,526	220,999
Operating Segments [Member] | Property | Insurance Segment
Net premiums earned by line of business:
P&C Operations		215,128	142,874	343,369	282,607
Operating Segments [Member] | Property | Reinsurance Segment
Net premiums earned by line of business:
P&C Operations		231,897	142,337	363,121	277,576
Operating Segments [Member] | Marine, energy, aviation and satellite | Insurance Segment
Net premiums earned by line of business:
P&C Operations		(16)	0	(16)	0
Operating Segments [Member] | Marine, energy, aviation and satellite | Reinsurance Segment
Net premiums earned by line of business:
P&C Operations		32,549	21,065	50,624	44,579
Operating Segments [Member] | Specialty | Insurance Segment
Net premiums earned by line of business:
P&C Operations		411,438	179,948	596,162	356,857
Operating Segments [Member] | Specialty | Reinsurance Segment
Net premiums earned by line of business:
P&C Operations		0	0	0	0
Operating Segments [Member] | Other | Insurance Segment
Net premiums earned by line of business:
P&C Operations	[2]	79,536	54,669	153,131	111,036
Operating Segments [Member] | Other | Reinsurance Segment
Net premiums earned by line of business:
P&C Operations	[2]	$ 53,978	$ 30,954	$ 74,578	$ 57,027

[1] Corporate and Other includes other items of our revenue and expenditures that are not evaluated at the segment level for reporting purposes, as well as the Company's Run-Off Life Operations.

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

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Acquisition and Disposals - Sale of strategic operating affiliate (Details) - ARX Holding Corporation - USD ($) $ in Millions	Apr. 02, 2015	Apr. 01, 2015
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Equity method investment, ownership percentage		40.60%
Investment in affiliates		$ 220.2
Consideration received		$ 560.6
Gain on disposal	$ 340.4

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UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Net income (loss) attributable to ordinary shareholders	$ 915,039	$ (279,260)	$ 951,320	$ (23,543)
Unrealized gains on held to maturity investment portfolio at time of transfer to available for sale, net of tax	0	424,861	0	424,861
Change in adjustments related to future policy benefit reserves, net of tax	26,328	(440,461)	86,684	(474,465)
Change in net unrealized gains (losses) on affiliate and other investments, net of tax	18,822	10,850	34,687	13,973
Change in OTTI losses recognized in other comprehensive income, net of tax	1,575	1,636	11,433	4,932
Change in underfunded pension liability, net of tax	(1,329)	(8)	(354)	(39)
Change in value of cash flow hedge	12	110	107	220
Foreign currency translation adjustments, net of tax	(34,423)	(9,602)	1,680	(13,482)
Comprehensive income (loss)	286,043	(18,887)	543,036	446,834
Excluding Life Funds Withheld Assets
Change in net unrealized gains (losses) on investments, net of tax	(318,935)	260,690	(258,590)	502,080
Life Funds Withheld Assets
Change in net unrealized gains (losses) on investments, net of tax	$ (321,046)	$ 12,297	$ (283,931)	$ 12,297

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Acquisition and Disposals

6 Months Ended

Jun. 30, 2015

Acquisition and Disposal [Abstract]

Acquisition and Disposals

Acquisition and Disposals

(a)    Catlin Acquisition

Overview

On May 1, 2015 (the "Acquisition Date"), the Company completed its acquisition (the "Catlin Acquisition") of the entire issued share capital of Catlin as contemplated by that certain Implementation Agreement, dated January 9, 2015 (the "Implementation Agreement"), by and among XL-Ireland, Green Holdings Limited, a wholly-owned subsidiary of the Company ("Green Holdings"), and Catlin.

Pursuant to the terms of the Implementation Agreement, the Catlin Acquisition was implemented by way of a scheme of arrangement (the "Scheme") under Section 99 of the Companies Act 1981 of Bermuda, as amended (the "Companies Act"), and sanctioned by the Supreme Court of Bermuda (the "Court"), immediately after which Catlin was merged with Green Holdings under Section 104H of the Companies Act, with Green Holdings as the surviving company, pursuant to the terms of that certain Merger Agreement, dated January 9, 2015 (the "Merger Agreement"), among XL-Ireland, Green Holdings and Catlin.

Pursuant to the terms of the Implementation Agreement, XL-Ireland acquired each ordinary share of Catlin, par value $0.01 per share ("Catlin Shares"), for consideration per Catlin Share (the "Acquisition Consideration") equal to 388 pence in cash and 0.130 of an XL-Ireland ordinary share, par value $0.01 per share ("XL Shares"), subject to the mix and match facility set forth in the Implementation Agreement. The newly-issued XL Shares are listed on the New York Stock Exchange. The XL Shares issued in connection with the Catlin Acquisition were issued in reliance upon the exemption from registration under the U.S. Securities Act of 1933, as amended (the "Securities Act") provided by Section 3(a)(10) of the Securities Act.

XL-Ireland issued approximately 49.9 million XL Shares and paid approximately £1.49 billion in cash to the holders of Catlin Shares as Acquisition Consideration pursuant to the terms of the Scheme.

The foregoing description of the Implementation Agreement and the Merger Agreement is qualified in its entirety by reference to the full text of the Implementation Agreement and Merger Agreement, copies of which were filed on Form 8-K on January 9, 2015.

In connection with the Catlin Acquisition, on January 9, 2015, the Company announced that it was relying on £1.6 billion of debt to be provided under a bridge facility entered into by XLIT Ltd., a wholly-owned subsidiary of the Company ("XL-Cayman"), and arranged by Morgan Stanley Senior Funding, Inc. and Goldman Sachs Bank USA (the "Bridge Facility") for the purposes of discharging the cash component of the Acquisition Consideration. The Company subsequently terminated the commitments under the Bridge Facility as of April 8, 2015, due to a sufficient amount in escrow to discharge the cash portion of the Acquisition Consideration. Costs related to maintaining the Bridge Facility are discussed in "Transaction-related Costs" below.

In addition, on January 9, 2015, the Company entered into deal contingent deliverable foreign exchange forwards ("FX Forwards") with Morgan Stanley Capital Services LLC and Goldman Sachs International. The purpose of the FX Forwards was to mitigate risk of foreign currency exposure related to the Catlin Acquisition. Following the closing of the Catlin Acquisition, the FX Forwards were settled.

Acquisition Consideration

The calculation of the consideration transferred to acquire Catlin Shares is as follows:

(In thousands, except per share data)
Catlin Shares outstanding as of April 30, 2015 that received share consideration (including the dilutive effect of warrants)	384,118
Exchange ratio per the implementation agreement	0.130
XL Share issuance to Catlin shareholders	49,935
Closing price per XL share on April 30, 2015 (1)	$	37.08
XL Share issuance consideration	$	1,851,601
Catlin Shares outstanding as of April 30, 2015 that received cash consideration (including the dilutive effect of warrants)	384,118
Cash price component, per Catlin Share in GBP	£	3.88
Cash consideration, in GBP	£	1,490,377
Foreign exchange rate: GBP/USD on April 30, 2015	$	1.5349
Cash consideration	$	2,287,579
Total acquisition consideration	$	4,139,180

____________

(1) The closing market price of XL Shares on the Acquisition Date represents the fair value of XL shares issued as part of the Acquisition Consideration.

The Company financed the $2.29 billion cash portion of the Acquisition Consideration by issuing $1.0 billion of subordinated debt, the proceeds (net of debt issuance costs) of which were $980.6 million, and the remaining $1.31 billion by using cash and cash equivalents on hand. See Note 10, "Notes Payable and Debt and Financing Arrangements," for further information on the debt issuance.

Fair Value of Net Assets Acquired and Liabilities Assumed

The purchase price was allocated to the acquired assets and assumed liabilities of Catlin based on estimated fair values on the Acquisition Date. The Company recognized goodwill of $778.0 million which is primarily attributable to the synergies and economies of scale expected to result upon integration of Catlin into the Company's operations, including further diversification in geographic mix and product offerings and an increase in distribution strength. Due to the timing of the Catlin Acquisition, the Company has not completed the assignment of goodwill to reporting units for the reporting period ending June 30, 2015. The Company estimates that none of the goodwill that was recorded will be deductible for income tax purposes. The Company also recognized indefinite lived intangible assets of $673.0 million and other intangible assets of $315.0 million, which will be amortized over their estimated useful lives. See Note 8, "Goodwill and Other Intangible Assets," for further information.

The foregoing allocation of the purchase price is based on information that was available to management at the time the consolidated financial statements were prepared. The allocation may change as additional information becomes available within the measurement period, which cannot exceed 12 months from the Acquisition Date. The fair value recorded for these items may be subject to adjustments, which may impact the individual amounts recorded for assets acquired and liabilities assumed, as well as the residual goodwill.

The following table summarizes the fair values of the assets acquired and liabilities assumed at the Acquisition Date:

(U.S. dollars in thousands)
ASSETS
Fixed maturities, at fair value	$	6,266,489
Short-term investments, at fair value	634,599
Equity investments, at fair value	236,230
Investment in affiliates	216,843
Other investments	386,828
Total investments	$	7,740,989
Cash and cash equivalents (1)	1,267,565
Accrued investment income	35,063
Premiums receivable	2,545,188
Unpaid losses and loss expenses recoverable	1,493,267
Reinsurance balances receivable	299,579
Ceded unearned premiums	1,143,852
Deferred acquisition costs and value of business acquired	679,259
Intangible assets	988,000
Receivable from investments sold	9,633
Other assets	314,168
Total assets	$	16,516,563
LIABILITIES
Unpaid losses and loss expenses	$	6,933,144
Unearned premiums	3,742,234
Reinsurance balances payable	1,441,749
Notes payable and debt	82,066
Payable for investments purchased	34,149
Deferred tax liability	94,071
Other liabilities	265,728
Total liabilities	$	12,593,141
Net assets acquired before non-controlling interest	$	3,923,422
Non-controlling interest in equity of consolidated subsidiaries	562,285
Net assets acquired	$	3,361,137
Acquisition Consideration	$	4,139,180
Goodwill	$	778,043

____________

(1)    Includes Restricted Cash

An explanation of the significant adjustments to the components of fair value are as follows:

• Deferred acquisition costs and value of business acquired - The adjustment consists of two components. The first adjustment is the elimination of Catlin's deferred acquisition costs asset. The second adjustment is the establishment of the value of business acquired asset which represents the present value of the expected underwriting profit within the unearned premiums liability, net of reinsurance, less costs to service the related policies and a risk premium. This adjustment will be amortized to underwriting, acquisition and insurance expenses over approximately two years, as the contracts for business in-force as of the Acquisition Date expire. The Company has included $183.3 million in acquisition expenses related to the amortization of the value of business acquired during the three and six months ended June 30, 2015.

• Intangible assets - Establish the estimated fair value of intangible assets related to Catlin. See Note 8, "Goodwill and Other Intangible Assets" for further information.

• Other assets - Establish the estimated fair value of Catlin's internally developed software.

• Unpaid losses and loss adjustment expenses - Unpaid losses and loss adjustment expenses acquired include an increase to adjust the carrying value of Catlin's historical unpaid losses and loss adjustment expenses, net of related reinsurance recoverable, to fair value as of the Acquisition Date. The estimated fair value consists of the present value of the expected net loss and loss adjustment expense payments plus a risk premium. This adjustment, plus the unamortized fair value adjustment included in Catlin's historical unpaid losses and loss adjustment expenses, will be amortized to losses and loss adjustment expenses over a weighted average period of approximately 20 years, based on the estimated payout pattern of net reserves as of the Acquisition Date.

• Net deferred tax liabilities - The adjustment to deferred tax liabilities is related to the deferred tax impact of the adjustments to fair value as noted above. This net increase of deferred tax liabilities is explained further in "Income Taxes" below.

• Non-controlling interest - The fair value was determined based on the last trade price of preferred shares issued by Catlin Insurance Company Limited ("Catlin-Bermuda"). See Note 9, "Share Capital" for further information.

Income Taxes

As part of the allocation of the purchase price, the Company recorded a total net deferred tax liability of $94.1 million. This is the combination of an excess of gross tax liabilities over gross tax assets by $22.1 million, and a valuation allowance of $72.0 million across several jurisdictions. The $94.1 million total net deferred tax liability is comprised of a deferred tax liability of $133.8 million related to the estimated fair value of the intangible assets recorded at the Acquisition Date, partially offset by deferred tax assets, net of associated valuation allowances, of $17.4 million related to loss carry forwards, $13.0 million related to fixed assets, and $8.8 million related to the fair value measurements of unpaid losses and loss adjustment expenses, and deferred acquisition costs and the value of business acquired. The remaining $0.5 million of deferred tax assets relates primarily to differences between financial reporting and tax bases of the other acquired assets and liabilities as of the Acquisition Date.

As a result of the Catlin Acquisition, the expected full year effective tax rate has been determined using a single rate approach taking into account the full year expected results, including the post-acquisition results of the acquired businesses.

In order to align all U.S. regulated entities under X.L. America, Inc., an indirect, wholly-owned subsidiary of XL-Ireland ("XLA"), the Company is seeking to have XLA purchase 100% of the stock of Catlin Inc. from Catlin North America Holdings, Ltd, a U.K. holding company. Subject to receipt of the necessary regulatory approvals, the Company intends to complete this restructuring by no later than October 31, 2015. If the restructuring occurs by the specified date, there would likely be a release of the valuation allowance currently held against the deferred tax asset maintained by Catlin Inc. which would result in a permanent tax benefit through operations.

Transaction-related Costs

The Company incurred certain acquisition and financing costs associated with the transaction. The Company has recorded $61.8 million of these costs for the six months ended June 30, 2015, of which $47.3 million has been included in Operating Expense and $14.5 million has been included in Interest Expense.

Transaction costs included in Operating Expense primarily consist of due diligence, legal, advisory and investment banking costs. Transaction costs included in Interest Expense related to the maintenance of the Bridge Facility. Pursuant to the terms of the Implementation Agreement, Catlin was required to pay its own costs and expenses in relation to the negotiation, preparation, execution and implementation of the Catlin Acquisition. Costs incurred by Catlin were recorded and paid by Catlin prior to the Acquisition Date and are not included within the Company's consolidated statements of income and comprehensive income.

As a part of the ongoing integration of Catlin's operations, the Company incurs costs associated with restructuring the systems, processes and workforce. These costs include such items as severance, retention, facilities and consulting and other costs. The Company separately identifies such costs and includes these expenses within Corporate and Other:

(U.S. dollars in thousands)	Severance costs		Retention costs		Facilities-related costs		Consulting and other
Costs incurred in 2015	$	12,274	$	365	$	1,530	$	13,676
2015 payments	1,639		—		462		4,573
Liabilities at June 30, 2015	$	10,635	$	365	$	1,068	$	9,103

Financial Results

The following table summarizes the results of the acquired Catlin operations since the Acquisition Date that have been included within the Company's consolidated statements of income and comprehensive income.

(U.S. dollars in thousands)	May 1, 2015 to June 30, 2015
Total revenues	$	709,800
Net income (loss) attributable to ordinary shareholders	$	50,017

Supplemental Pro Forma Information

The results of the acquired Catlin operations have been included in the Company's unaudited consolidated financial statements from the Acquisition Date to June 30, 2015. The following table presents unaudited pro forma consolidated information for the six months ended June 30, 2015 and 2014 and assumes the Catlin Acquisition occurred on January 1, 2014. The pro forma financial information is presented for informational purposes only and does not necessarily reflect the results that would have occurred had the acquisition taken place on January 1, 2014, nor is it necessarily indicative of future results. Significant adjustments used to determine pro forma results include amortization of intangible assets and amortization of fair value adjustments discussed above, and the corresponding income tax effects. Non-recurring transaction related costs noted above have been included in the unaudited pro forma results for the six months ended June 30, 2014.

	Unaudited Pro Forma
	Six Months Ended June 30,
(In thousands, except per share data)	2015		2014
Total revenues	$	5,427,900	$	5,736,519
Net income attributable to ordinary shareholders	960,951		107,279
Earnings (loss) per ordinary share and ordinary share equivalent – basic	3.14		0.33
Earnings (loss) per ordinary share and ordinary share equivalent – diluted	3.09		0.33

(b)    Sale of Strategic Operating Affiliate

On April 1, 2015, XL Re Ltd ("XL Re"), an indirect wholly-owned subsidiary of the Company, completed the previously announced sale of all of its shares in ARX Holding Corp. ("ARX") to The Progressive Corporation ("Progressive") pursuant to the terms of the Stock Purchase Agreement with Progressive. XL Re's shares in ARX represented approximately 40.6% of ARX's outstanding capital stock on a fully diluted basis at the time of the announcement. The carrying value of XL Re's shares in ARX was $220.2 million at the time of the sale.

XL Re received $560.6 million in proceeds from the transaction, which was based upon the consolidated tangible net book value of ARX and its subsidiaries as of December 31, 2014, and certain other factors. Thus, the Company recorded a gain of $340.4 million as a result of this transaction that is reflected in the unaudited consolidated statement of income for the three and six months endedJune 30, 2015.

(c)    Sale of Life Reinsurance Subsidiary

On May 1, 2014, a wholly owned subsidiary of the Company, XL Insurance (Bermuda) Ltd ("XLIB"), entered into a sale and purchase agreement with GreyCastle Holdings Ltd. ("GreyCastle") providing for the sale of 100% of the common shares of XLIB's wholly-owned subsidiary, XL Life Reinsurance (SAC) Ltd ("XLLR"), to GreyCastle for $570 million in cash (subsequent to the transaction, XLLR changed its name to GreyCastle Life Reinsurance (SAC) Ltd ("GCLR")). This transaction closed on May 30, 2014. As a result of the transaction, the Company ceded the majority of its life reinsurance business to GCLR via 100% quota share reinsurance (the "Life Retro Arrangements"). This transaction covered a substantial portion of our life reinsurance reserves. The Company ceased writing new life reinsurance contracts in 2009 and since that time has been managing the run-off of its life reinsurance operations ("Run-Off Life Operations"). The designated investments that support the Life Retro Arrangements on a funds withheld basis ("Life Funds Withheld Assets") are managed pursuant to agreed investment guidelines that meet the contractual commitments of the Company's ceding subsidiaries and applicable laws and regulations. All of the investment results associated with the Life Funds Withheld Assets ultimately accrue to GCLR.

Because the Company no longer shares in the risks and rewards of the underlying performance of the supporting invested assets, disclosures within the financial statement notes included herein separate the Life Funds Withheld Assets from the rest of the Company's investments.

As of May 30, 2014, gross future policy benefit reserves relating to the Life operations were approximately $5.2 billion. Subsequent to the completion of the GreyCastle transaction, the Company retained approximately $0.4 billion of these reserves, and recorded a reinsurance recoverable from GCLR of $4.8 billion. Under the terms of the transaction, the Company continues to own, on a funds withheld basis, assets supporting the Life Retro Arrangements consisting of cash, fixed maturity securities and accrued interest. Based upon the right of offset, the funds withheld liability owing to GCLR is recorded net of future policy benefit reserves recoverable, and is included within "Funds withheld on life retrocession arrangements (net of future policy benefit reserves recoverable)" on the unaudited consolidated balance sheets. The transaction resulted in an overall after-tax U.S. GAAP net loss of $621.3 million that is reflected in the unaudited consolidated statements of income for the three and six months ended June 30, 2014.

As of June 30, 2015, gross future policy benefit reserves relating to the Run-Off Life Operations were approximately $4.5 billion, of which the Company retained approximately $0.4 billion, after consideration of its future policy benefit reserves recoverable from GCLR of approximately $4.1 billion. The net funds withheld liability included within "Funds withheld on life retrocession arrangements, net of future policy benefit reserves recoverable" was $0.9 billion. The Company continued to own $5.0 billion of assets supporting the Life Retro Arrangements.

The impact of the Life Retro Arrangements on the Company's results was as follows:

Impact of Life Retro Arrangements	Three months ended June 30,						Six Months Ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Underwriting profit (loss) (1)	$	—		$	—		$	603		$	—
Net investment income - Life Funds Withheld Assets	46,864			19,165			97,283			19,165
Net realized gains (losses) on investments sold - Life Funds Withheld Assets	68,037			624			120,775			624
Net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets	(19,543		)	—			(18,783		)	—
OTTI on investments - Life Funds Withheld Assets	(2,878		)	(8,771		)	(8,087		)	(8,771		)
Exchange gains (losses)	(18,370		)	—			(14,686		)	—
Other income and expenses	3,773			(19		)	2,475			(19		)
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	239,174			(17,546		)	9,807			(17,546		)
Net income (loss)	$	317,057		$	(6,547	)	$	189,387		$	(6,547	)
Change in net unrealized gains (losses) on investments - Life Funds Withheld Assets, net of tax	(321,046		)	12,297			(283,931		)	12,297
Change in adjustments related to future policy benefit reserves, net of tax	26,328			—			86,684			—
Change in cumulative translation adjustment - Life Funds Withheld Assets, net of tax	(22,339		)	(5,750		)	8,463			(5,750		)
Total changes to other comprehensive income as a result of Life Retro Arrangements	$	(317,057	)	$	6,547		$	(188,784	)	$	6,547
Comprehensive income (loss)	$	—		$	—		$	603		$	—

____________

(1) The underwriting profit of $0.6 million relates to a premium adjustment during the six months ended June 30, 2015 relating to the Life Retro Arrangements transaction. Excluding this transaction, the impact to comprehensive income relating to the Life Retro Arrangements was nil for the three and six months ended June 30, 2015.

As shown in the table above, although the Company's net income (loss) is subject to variability related to the Life Retro Arrangements, there is minimal net impact on the Company's comprehensive income in any period. The life retrocession embedded derivative value includes the interest income, unrealized gains and losses, and realized gains and losses from sales on the Life Funds Withheld Assets subsequent to May 30, 2014.

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Derivative Instruments - Balance sheet offsetting (Details) - USD ($) $ in Thousands		Jun. 30, 2015	Dec. 31, 2014
Derivative assets:
Gross amounts recognized in balance sheet		$ 228,475	$ 136,659
Derivative Asset, Fair Value, Gross Liability	[1]	3,239	696
Net amounts in the balance sheet		225,236	135,963
Gross amounts not offset in the balance sheet - financial instruments		0	0
Gross amounts not offset in the balance sheet - cash collateral		132,050	78,580
Derivative Asset		93,186	57,383
Derivative liabilities:
Gross amounts recognized in balance sheet		82,884	31,184
Derivative Liability, Fair Value, Gross Asset	[1]	3,239	696
Net amounts in the balance sheet		79,645	30,488
Gross amounts not offset in the balance sheet - financial instruments		0	0
Gross amounts not offset in the balance sheet - cash collateral		0	0
Derivative Liability		$ 79,645	$ 30,488

[1] Other assets and other liabilities include derivative instruments. The derivative balances included in each category are reported on a gross basis by level with a netting adjustment presented separately in the Collateral and Counterparty Netting column. The fair values of the individual derivative contracts are reported gross in their respective levels based on the fair value hierarchy. For further details regarding derivative fair values and associated collateral received or paid see Note 7, "Derivative Instruments," to the Unaudited Consolidated Financial Statements.

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Share Capital - Options valuation assumptions (Details) - 6 months ended Jun. 30, 2015	Total
Stockholders' Equity Note [Abstract]
Dividend yield	2.00%
Risk free interest rate	1.70%
Volatility	21.60%
Expected lives	6 years

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Investments (Tables)

6 Months Ended

Jun. 30, 2015

Investments, Debt and Equity Securities [Abstract]

Amortized cost and fair value summary

The cost (amortized cost for fixed maturities and short-term investments), fair value, gross unrealized gains and gross unrealized (losses), including non-credit related OTTI recorded in accumulated other comprehensive income ("AOCI"), of the Company’s AFS investments as of June 30, 2015 and December 31, 2014, were as follows:

June 30, 2015 (U.S. dollars in thousands)	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Non-credit Related OTTI (1)
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	3,786,878	$	56,994	$	(16,766	)	$	3,827,106	$	—
Corporate - Financials	3,194,676		61,404		(20,567		)	3,235,513		—
Corporate - Non Financials (2)	6,792,840		209,968		(50,744		)	6,952,064		(3,309		)
RMBS – Agency	3,890,265		88,699		(20,820		)	3,958,144		—
RMBS – Non-Agency	361,661		28,531		(17,921		)	372,271		(57,074		)
CMBS	929,466		14,903		(8,311		)	936,058		(1,598		)
CDO	505,865		6,733		(24,573		)	488,025		(1,625		)
Other asset-backed securities (2)	2,326,633		35,669		(11,915		)	2,350,387		(1,516		)
U.S. States and political subdivisions of the States	2,301,628		101,435		(11,790		)	2,391,273		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	5,220,879		111,046		(71,863		)	5,260,062		—
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	29,310,791	$	715,382	$	(255,270	)	$	29,770,903	$	(65,122	)
Total short-term investments - Excluding Life Funds Withheld Assets	$	806,990	$	1,190	$	(694	)	$	807,486	$	—
Total equity securities - Excluding Life Funds Withheld Assets	$	964,038	$	136,219	$	(26,787	)	$	1,073,470	$	—
Total investments - AFS - Excluding Life Funds Withheld Assets	$	31,081,819	$	852,791	$	(282,751	)	$	31,651,859	$	(65,122	)
Fixed maturities - AFS - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	11,501	$	2,177	$	—		$	13,678	$	—
Corporate - Financials	639,699		83,223		—			722,922		—
Corporate - Non Financials	1,439,134		226,544		—			1,665,678		—
RMBS – Agency	674		163		—			837		—
RMBS – Non-Agency	26,377		3,214		—			29,591		—
CMBS	126,539		19,078		—			145,617		—
Other asset-backed securities	164,779		22,758		—			187,537		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	980,215		251,013		—			1,231,228		—
Total fixed maturities - AFS - Life Funds Withheld Assets	$	3,388,918	$	608,170	$	—		$	3,997,088	$	—
Total investments - AFS	$	34,470,737	$	1,460,961	$	(282,751	)	$	35,648,947	$	(65,122	)
Fixed maturities - Trading - Life Funds Withheld Assets								Amortized Cost		Fair Value
U.S. Government and Government-Related/Supported								$	3,628	$	3,596
Corporate - Financials								194,385		187,169
Corporate - Non Financials								343,658		332,654
CMBS								262		261
Other asset-backed securities								15,016		14,823
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported								254,100		252,981
Total investments - Trading - Life Funds Withheld Assets								$	811,049	$	791,484

___________

(1) Represents the non-credit component of OTTI losses, adjusted for subsequent sales of securities. It does not include the change in fair value subsequent to the date an impairment was recorded.

(2) Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $75.3 million and an amortized cost of $64.5 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

December 31, 2014 (U.S. dollars in thousands)	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Non-credit Related OTTI (1)
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	2,100,851	$	77,889	$	(6,787	)	$	2,171,953	$	—
Corporate - Financials	2,687,797		87,058		(12,939		)	2,761,916		—
Corporate - Non Financials (2)	5,774,333		278,747		(36,623		)	6,016,457		(3,309		)
RMBS – Agency	3,625,171		114,188		(10,783		)	3,728,576		—
RMBS – Non-Agency	404,398		41,108		(18,155		)	427,351		(67,918		)
CMBS	1,033,819		23,987		(5,262		)	1,052,544		(2,033		)
CDO	717,544		1,659		(27,169		)	692,034		(1,663		)
Other asset-backed securities (2)	1,028,528		42,810		(6,045		)	1,065,293		(1,797		)
U.S. States and political subdivisions of the States	1,892,566		129,910		(1,204		)	2,021,272		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	4,162,425		139,484		(61,836		)	4,240,073		—
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	23,427,432	$	936,840	$	(186,803	)	$	24,177,469	$	(76,720	)
Total short-term investments - Excluding Life Funds Withheld Assets	$	257,221	$	49	$	(543	)	$	256,727	$	—
Total equity securities - Excluding Life Funds Withheld Assets	$	763,833	$	130,689	$	(26,230	)	$	868,292	$	—
Total investments - AFS - Excluding Life Funds Withheld Assets	$	24,448,486	$	1,067,578	$	(213,576	)	$	25,302,488	$	(76,720	)
Fixed maturities - AFS - Life Funds Withheld Assets
U.S. Government and Government-Related/Supported	$	14,866	$	3,858	$	—		$	18,724	$	—
Corporate - Financials	701,587		99,432		—			801,019		—
Corporate - Non Financials	1,706,262		310,699		—			2,016,961		—
RMBS – Agency	3,301		481		—			3,782		—
RMBS – Non-Agency	71,075		14,260		—			85,335		—
CMBS	168,886		24,281		—			193,167		—
Other asset-backed securities	238,168		35,373		—			273,541		—
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	1,397,194		391,842		—			1,789,036		—
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	4,301,339	$	880,226	$	—		$	5,181,565	$	—
Total investments - AFS	$	28,749,825	$	1,947,804	$	(213,576	)	$	30,484,053	$	(76,720	)
Fixed maturities - Trading - Life Funds Withheld Assets								Amortized Cost		Fair Value
Corporate - Non Financials								$	1,180	$	1,171
Total investments - Trading - Life Funds Withheld Assets								$	1,180	$	1,171

____________

(1) Represents the non-credit component of OTTI losses, adjusted for subsequent sales of securities. It does not include the change in fair value subsequent to the date an impairment was recorded.

(2) Included are certain medium term notes supported primarily by pools of European investment grade credit with varying degrees of leverage. The notes have a fair value of $79.9 million and an amortized cost of $68.4 million. These notes allow the investor to participate in cash flows of the underlying bonds including certain residual values, which could serve to either decrease or increase the ultimate value of these notes.

Contractual maturities summary

The contractual maturities of AFS fixed income securities at June 30, 2015 and December 31, 2014 are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	June 30, 2015				December 31, 2014
(U.S. dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Fixed maturities - AFS - Excluding Life Funds Withheld Assets
Due less than one year	$	1,957,896	$	1,962,391	$	1,972,224	$	1,980,429
Due after 1 through 5 years	12,409,937		12,584,530		8,919,037		9,113,651
Due after 5 through 10 years	5,231,268		5,305,166		4,232,396		4,412,569
Due after 10 years	1,697,800		1,813,931		1,494,315		1,705,022
	$	21,296,901	$	21,666,018	$	16,617,972	$	17,211,671
RMBS – Agency	3,890,265		3,958,144		3,625,171		3,728,576
RMBS – Non-Agency	361,661		372,271		404,398		427,351
CMBS	929,466		936,058		1,033,819		1,052,544
CDO	505,865		488,025		717,544		692,034
Other asset-backed securities	2,326,633		2,350,387		1,028,528		1,065,293
Total mortgage and asset-backed securities	$	8,013,890	$	8,104,885	$	6,809,460	$	6,965,798
Total fixed maturities - AFS - Excluding Life Funds Withheld Assets	$	29,310,791	$	29,770,903	$	23,427,432	$	24,177,469
Fixed maturities - AFS - Life Funds Withheld Assets
Due less than one year	$	87,963	$	96,402	$	117,048	$	125,326
Due after 1 through 5 years	468,476		505,063		638,526		685,787
Due after 5 through 10 years	705,507		808,909		1,004,698		1,165,348
Due after 10 years	1,808,603		2,223,132		2,059,637		2,649,279
	$	3,070,549	$	3,633,506	$	3,819,909	$	4,625,740
RMBS – Agency	674		837		3,301		3,782
RMBS – Non-Agency	26,377		29,591		71,075		85,335
CMBS	126,539		145,617		168,886		193,167
Other asset-backed securities	164,779		187,537		238,168		273,541
Total mortgage and asset-backed securities	$	318,369	$	363,582	$	481,430	$	555,825
Total fixed maturities - AFS - Life Funds Withheld Assets	$	3,388,918	$	3,997,088	$	4,301,339	$	5,181,565
Total fixed maturities - AFS	$	32,699,709	$	33,767,991	$	27,728,771	$	29,359,034
Fixed maturities - Trading - Life Funds Withheld Assets
Due less than one year	$	42,557	$	42,553	$	—	$	—
Due after 1 through 5 years	221,522		220,727		—		—
Due after 5 through 10 years	162,877		160,923		1,180		1,171
Due after 10 years	368,815		352,197		—		—
	$	795,771	$	776,400	$	1,180	$	1,171
CMBS	262		261		—		—
Other asset-backed securities	15,016		14,823		—		—
Total mortgage and asset-backed securities	$	15,278	$	15,084	$	—	$	—
Total fixed maturities - Trading - Life Funds Withheld Assets	$	811,049	$	791,484	$	1,180	$	1,171

Summary of unrealized losses

The following is an analysis of how long the AFS securities as of June 30, 2015 and December 31, 2014 had been in a continual unrealized loss position:

	Less than 12 months					Equal to or greater than 12 months
June 30, 2015 (U.S. dollars in thousands)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Fixed maturities and short-term investments - AFS
U.S. Government and Government-Related/Supported	$	1,721,385	$	(12,211	)	$	109,027	$	(4,666	)
Corporate – Financials	1,054,854		(13,737		)	76,450		(6,846		)
Corporate – Non Financials	2,305,696		(41,526		)	146,220		(9,582		)
RMBS – Agency	1,136,559		(12,171		)	245,806		(8,649		)
RMBS – Non-Agency	45,052		(1,959		)	197,361		(15,962		)
CMBS	295,914		(5,263		)	100,100		(3,048		)
CDO	39,969		(5,506		)	322,684		(19,067		)
Other asset-backed securities	1,014,257		(6,535		)	59,985		(5,392		)
U.S. States and political subdivisions of the States	706,360		(10,617		)	17,546		(1,181		)
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	1,736,079		(38,213		)	459,362		(33,833		)
Total fixed maturities and short-term investments - AFS	$	10,056,125	$	(147,738	)	$	1,734,541	$	(108,226	)
Total equity securities	$	267,759	$	(26,787	)	$	—	$	—

	Less than 12 months					Equal to or greater than 12 months
December 31, 2014 (U.S. dollars in thousands)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Fixed maturities and short-term investments - AFS
U.S. Government and Government-Related/Supported	$	251,091	$	(1,196	)	$	342,890	$	(5,603	)
Corporate – Financials	387,619		(5,858		)	105,155		(7,097		)
Corporate – Non Financials	949,851		(28,023		)	319,066		(8,657		)
RMBS – Agency	134,535		(220		)	512,652		(10,563		)
RMBS – Non-Agency	45,378		(1,358		)	202,700		(16,797		)
CMBS	78,356		(385		)	169,065		(4,877		)
CDO	249,803		(2,666		)	414,516		(24,503		)
Other asset-backed securities	143,044		(2,813		)	57,544		(3,232		)
U.S. States and political subdivisions of the States	32,187		(210		)	63,695		(994		)
Non-U.S. Sovereign Government, Provincial, Supranational and Government-Related/Supported	624,346		(19,043		)	558,422		(43,251		)
Total fixed maturities and short-term investments - AFS	$	2,896,210	$	(61,772	)	$	2,745,705	$	(125,574	)
Total equity securities	$	191,193	$	(26,230	)	$	—	$	—

Analysis of net realized gains (losses) on investments

The following represents an analysis of net realized gains (losses) on investments:

Net Realized Gains (Losses) on Investments	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Net realized gains (losses) on investments - excluding Life Funds Withheld Assets:
Gross realized gains	$	48,547		$	118,947		$	110,845		$	170,160
Gross realized losses on investments sold	(27,608		)	(13,487		)	(74,728		)	(41,744		)
OTTI on investments, net of amounts transferred to other comprehensive income	(16,588		)	(24,616		)	(27,164		)	(28,343		)
	$	4,351		$	80,844		$	8,953		$	100,073
Net realized gains (losses) on investments and net unrealized gains (losses) on investments, Trading - Life Funds Withheld Assets:
Gross realized gains	$	84,641		$	624		$	137,769		$	624
Gross realized losses on investments sold	(16,604		)	—			(16,994		)	—
OTTI on investments, net of amounts transferred to other comprehensive income	(2,878		)	(8,771		)	(8,087		)	(8,771		)
Net unrealized gains (losses) on trading securities	$	(19,543	)	$	—		$	(18,783	)	$	—
	$	45,616		$	(8,147	)	$	93,905		$	(8,147	)
Total net realized gains (losses) on investments	$	49,967		$	72,697		$	102,858		$	91,926

Credit loss impairments on fixed inmcome securities rollforward

The following table sets forth the amount of credit loss impairments on fixed income securities held by the Company for which a portion of the OTTI loss was recognized in OCI, as of the dates or for the periods indicated and the corresponding changes in such amounts.

Credit Loss Impairments	Three months ended June 30,						Six months ended June 30,
(U.S. dollars in thousands)	2015			2014			2015			2014
Opening balance as of beginning of indicated period	$	108,458		$	171,382		$	131,942		$	174,805
Credit loss impairment recognized in the current period on securities not previously impaired	—			30			7,560			41
Credit loss impairments previously recognized on securities which matured, paid down, prepaid or were sold during the period	(8,495		)	(3,322		)	(37,034		)	(7,571		)
Credit loss impairments previously recognized on securities impaired to fair value during the period	(2,629		)	—			(2,629		)	—
Additional credit loss impairments recognized in the current period on securities previously impaired	246			892			387			3,153
Accretion of credit loss impairments previously recognized due to an increase in cash flows expected to be collected	(3,361		)	(3,105		)	(6,007		)	(4,551		)
Balance as of June 30,	$	94,219		$	165,877		$	94,219		$	165,877

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Variable Interest Entities (Details) - Variable Interest Entity, Primary Beneficiary [Member] - USD ($) $ in Millions	Jun. 30, 2015	Dec. 31, 2014
Variable Interest Entity [Line Items]
Noncontrolling Interest in Variable Interest Entity	$ 52.0	$ 58.4
Variable Interest Entity, Consolidated, Carrying Amount, Assets	135.9	139.9
New Ocean Capital Management Ltd [Member]
Variable Interest Entity [Line Items]
Noncontrolling Interest in Variable Interest Entity	$ 0.2	$ 0.2

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Acquisition and Disposals - Transaction related costs (Details) - Jun. 30, 2015 - USD ($) $ in Thousands	Total
Severance costs
Business Combination, Separately Recognized Transactions [Line Items]
Costs incurred in 2015	$ 12,274
2015 payments	1,639
Liabilities at June 30, 2015	10,635
Retention costs
Business Combination, Separately Recognized Transactions [Line Items]
Costs incurred in 2015	365
2015 payments	0
Liabilities at June 30, 2015	365
Facilities-related costs
Business Combination, Separately Recognized Transactions [Line Items]
Costs incurred in 2015	1,530
2015 payments	462
Liabilities at June 30, 2015	1,068
Consulting and other
Business Combination, Separately Recognized Transactions [Line Items]
Costs incurred in 2015	13,676
2015 payments	4,573
Liabilities at June 30, 2015	$ 9,103

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Computation of Earnings Per Ordinary Share and Ordinary Share Equivalent

6 Months Ended

Jun. 30, 2015

Earnings Per Share [Abstract]

Computation of Earnings Per Ordinary Share and Ordinary Share Equivalent

Computation of Earnings Per Ordinary Share and Ordinary Share Equivalent

The following table sets forth the computation of basic and diluted earnings per ordinary share for the three and six months ended June 30, 2015 and 2014:

	Three Months Ended June 30,					Six Months Ended June 30,
(U.S. dollars in thousands, except per share amounts)	2015		2014			2015		2014
Basic earnings per ordinary share & ordinary share equivalents outstanding:
Net income (loss) attributable to ordinary shareholders	$	915,039	$	(279,260	)	$	951,320	$	(23,543	)
Weighted average ordinary shares outstanding, in thousands - basic	289,420		270,924			272,665		273,616
Basic earnings per ordinary share & ordinary share equivalents outstanding	$	3.16	$	(1.03	)	$	3.49	$	(0.09	)
Diluted earnings per ordinary share & ordinary share equivalents outstanding:
Weighted average ordinary shares outstanding, in thousands - basic	289,420		270,924			272,665		273,616
Impact of share-based compensation and certain conversion features, in thousands	4,563		—			4,808		—
Weighted average ordinary shares outstanding, in thousands - diluted	293,983		270,924			277,473		273,616
Diluted earnings per ordinary share & ordinary share equivalents outstanding	$	3.11	$	(1.03	)	$	3.43	$	(0.09	)
Dividends per ordinary share	$	0.16	$	0.16		$	0.32	$	0.32

For the three months ended June 30, 2015 and 2014, and for the six months ended June 30, 2015 and 2014, ordinary shares available for issuance under share-based compensation plans of 2.4 million and 16.8 million, respectively, and 4.5 million and 16.6 million, respectively, were not included in the calculation of diluted earnings per ordinary share because the assumed exercise or issuance of such shares would be anti-dilutive.