Guarantor Financial Information (Tables)

6 Months Ended

Jun. 30, 2017

Condensed Income Statements, Captions [Line Items]

Guarantor balance sheet

	June 30, 2017
Condensed Consolidating Balance Sheet (U.S. dollars in thousands, except share data)	XL-Group (1)		XLIT		Other XL Group Subsidiaries		Consolidating Adjustments and Eliminations			XL Group Consolidated
ASSETS
Investments:
Total investments available for sale	$	—	$	570,576	$	32,032,542	$	—		$	32,603,118
Total investments trading	—		—		1,772,877		—			1,772,877
Investments in affiliates	—		—		2,127,115		—			2,127,115
Other investments	—		—		1,126,741		—			1,126,741
Total investments	$	—	$	570,576	$	37,059,275	$	—		$	37,629,851
Cash and cash equivalents	1,144		423,398		2,709,280		—			3,133,822
Restricted cash	—		—		181,230		—			181,230
Investments in subsidiaries (2)	11,068,864		14,645,048		—		(25,713,912		)	—
Accrued investment income	10		2,484		268,246		(10		)	270,730
Deferred acquisition costs and value of business acquired	—		—		1,143,671		—			1,143,671
Ceded unearned premiums	—		—		2,566,652		—			2,566,652
Premiums receivable	—		—		6,973,206		—			6,973,206
Reinsurance balances receivable	—		—		755,511		—			755,511
Unpaid losses and loss expenses recoverable	—		—		5,858,369		—			5,858,369
Receivable from investments sold	—		46,375		395,964		—			442,339
Goodwill and other intangible assets	—		—		2,219,390		—			2,219,390
Deferred tax asset	—		—		293,219		—			293,219
Amounts due from subsidiaries/parent	14,706		—		66,053		(80,759		)	—
Other assets	12,311		32,335		869,614		—			914,260
Total assets	$	11,097,035	$	15,720,216	$	61,359,680	$	(25,794,681	)	$	62,382,250
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Unpaid losses and loss expenses	$	—	$	—	$	26,822,346	$	—		$	26,822,346
Deposit liabilities	—		—		1,123,628		—			1,123,628
Future policy benefit reserves	—		—		3,591,573		—			3,591,573
Funds withheld on GreyCastle life retrocession arrangements	—		—		918,304		—			918,304
Unearned premiums	—				8,848,374		—			8,848,374
Notes payable and debt	—		3,207,339		—		—			3,207,339
Reinsurance balances payable	—		—		3,428,302		—			3,428,302
Payable for investments purchased	—		—		268,771		—			268,771
Deferred tax liability	—		—		97,879		—			97,879
Amounts due to subsidiaries/parent	—		66,053		14,706		(80,759		)	—
Other liabilities	16,483		33,460		923,384		—			973,327
Total liabilities	$	16,483	$	3,306,852	$	46,037,267	$	(80,759	)	$	49,279,843
Shareholders' Equity:
Shareholders' equity attributable to XL Group Ltd	$	11,080,552	$	11,063,364	$	14,645,048	$	(25,708,412	)	$	11,080,552
Non-controlling interest in equity of consolidated subsidiaries	—		1,350,000		677,365		(5,510		)	2,021,855
Total shareholders' equity	$	11,080,552	$	12,413,364	$	15,322,413	$	(25,713,922	)	$	13,102,407
Total liabilities and shareholders' equity	$	11,097,035	$	15,720,216	$	61,359,680	$	(25,794,681	)	$	62,382,250

____________

(1) Results for the period include XL-Ireland, which prior to the Redomestication was the ultimate parent and is now in liquidation proceedings as outlined in Note 1, "Significant Accounting Policies." The Company expects the net assets of XL-Ireland to ultimately be distributed to XL Group upon completion of the liquidation.

(2) XL Group balance includes investment in $5.5 million of XLIT Series D Preference Ordinary Shares and XLIT Series E Non-Cumulative Preference Ordinary Shares.

	December 31, 2016
Condensed Consolidating Balance Sheet (U.S. dollars in thousands, except share data)	XL Group (1)		XLIT		Other XL Group Subsidiaries		Consolidating Adjustments and Eliminations			XL Group Consolidated
ASSETS
Investments:
Total investments available for sale	$	—	$	638,236	$	31,280,890	$	—		$	31,919,126
Total investments trading	—		—		1,626,577		—			1,626,577
Investments in affiliates	—		—		2,177,645		—			2,177,645
Other investments	—		9		1,164,555		—			1,164,564
Total investments	$	—	$	638,245	$	36,249,667	$	—		$	36,887,912
Cash and cash equivalents	1,022		84,286		3,341,680		—			3,426,988
Restricted cash	—		—		153,504		—			153,504
Investments in subsidiaries	10,897,195		14,238,698		—		(25,135,893		)	—
Accrued investment income	55		2,981		281,385		(55		)	284,366
Deferred acquisition costs and value of business acquired	—		—		946,721		—			946,721
Ceded unearned premiums	—		—		1,687,864		—			1,687,864
Premiums receivable	—		—		5,522,976		—			5,522,976
Reinsurance balances receivable	—		—		577,479		—			577,479
Unpaid losses and loss expenses recoverable	—		—		5,491,297		—			5,491,297
Receivable from investments sold	—		—		128,411		—			128,411
Goodwill and other intangible assets	—		—		2,203,653		—			2,203,653
Deferred tax asset	—		—		310,542		—			310,542
Amounts due from subsidiaries/parent	42,780		—		72,962		(115,742		)	—
Other assets	15,188		40,108		757,093		—			812,389
Total assets	$	10,956,240	$	15,004,318	$	57,725,234	$	(25,251,690	)	$	58,434,102
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Unpaid losses and loss expenses	$	—	$	—	$	25,939,571	$	—		$	25,939,571
Deposit liabilities	—		—		1,116,233		—			1,116,233
Future policy benefit reserves	—		—		3,506,047		—			3,506,047
Funds withheld on GreyCastle life retrocession arrangements	—		—		998,968		—			998,968
Unearned premiums	—		—		7,293,028		—			7,293,028
Notes payable and debt	—		2,647,677		—		—			2,647,677
Reinsurance balances payable	—		—		2,451,717		—			2,451,717
Payable for investments purchased	—		—		226,009		—			226,009
Deferred tax liability	—		—		77,271		—			77,271
Amounts due to subsidiaries/parent	—		72,962		42,780		(115,742		)	—
Other liabilities	17,728		41,984		1,157,190		—			1,216,902
Total liabilities	$	17,728	$	2,762,623	$	42,808,814	$	(115,742	)	$	45,473,423
Shareholders' Equity:
Shareholders' equity attributable to XL Group Ltd	$	10,938,512	$	10,897,195	$	14,238,698	$	(25,135,893	)	$	10,938,512
Non-controlling interest in equity of consolidated subsidiaries	—		1,344,500		677,722		(55		)	2,022,167
Total shareholders' equity	$	10,938,512	$	12,241,695	$	14,916,420	$	(25,135,948	)	$	12,960,679
Total liabilities and shareholders' equity	$	10,956,240	$	15,004,318	$	57,725,234	$	(25,251,690	)	$	58,434,102

____________

(1) Results for the period include XL-Ireland, which prior to the Redomestication was the ultimate parent and is now in liquidation proceedings as outlined in Note 1, "Significant Accounting Policies." The Company expects the net assets of XL-Ireland to ultimately be distributed to XL Group upon completion of the liquidation.

Guarantor income statement

	Three Months Ended June 30, 2017
Condensed Consolidating Statement of Income and Comprehensive Income (U.S. dollars in thousands, except per share data)	XL Group (1)			XLIT			Other XL Group Subsidiaries			Consolidating Adjustments and Eliminations			XL Group Consolidated
Revenues:
Net premiums earned	$	—		$	—		$	2,516,917		$	—		$	2,516,917
Total net investment income	10			2,103			206,571			(10		)	208,674
Total net realized gains (losses) on investments	—			1,446			55,182			—			56,628
Net realized and unrealized gains (losses) on derivative instruments	—			—			(906		)	—			(906		)
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	—			—			(34,596		)	—			(34,596		)
Income (loss) from investment fund affiliates	—			—			30,818			—			30,818
Fee income and other	—			—			10,225			—			10,225
Total revenues	$	10		$	3,549		$	2,784,211		$	(10	)	$	2,787,760
Expenses:
Net losses and loss expenses incurred	$	—		$	—		$	1,529,083		$	—		$	1,529,083
Claims and policy benefits	—			—			7,595			—			7,595
Acquisition costs	—			—			433,584			—			433,584
Operating expenses	27,389			1,152			444,237			—			472,778
Exchange (gains) losses	936			26			(6,605		)	—			(5,643		)
Interest expense	—			35,277			18,741			—			54,018
Total expenses	$	28,325		$	36,455		$	2,426,635		$	—		$	2,491,415
Income (loss) before income tax and income (loss) from operating affiliates	$	(28,315	)	$	(32,906	)	$	357,576		$	(10	)	$	296,345
Income (loss) from operating affiliates	—			—			42,704			—			42,704
Equity in net earnings (losses) of subsidiaries	329,935			362,841			—			(692,776		)	—
Provision (benefit) for income tax	—			—			29,006			—			29,006
Net income (loss)	$	301,620		$	329,935		$	371,274		$	(692,786	)	$	310,043
Non-controlling interests	—			—			8,433			(10		)	8,423
Net income (loss) attributable to common shareholders	$	301,620		$	329,935		$	362,841		$	(692,776	)	$	301,620
Comprehensive income (loss)	$	377,811		$	406,126		$	439,032		$	(845,158	)	$	377,811

____________

(1) Results for the period include XL-Ireland, which prior to the Redomestication was the ultimate parent and is now in liquidation proceedings as outlined in Note 1, "Significant Accounting Policies." The Company expects the net assets of XL-Ireland to ultimately be distributed to XL Group upon completion of the liquidation.

	Three Months Ended June 30, 2016
Condensed Consolidating Statement of Income and Comprehensive Income (U.S. dollars in thousands, except per share data)	XL- Ireland			XLIT			Other XL-Ireland Subsidiaries			Consolidating Adjustments and Eliminations			XL-Ireland Consolidated
Revenues:
Net premiums earned	$	—		$	—		$	2,532,212		$	—		$	2,532,212
Total net investment income	64			3,096			211,747			481			215,388
Total net realized gains (losses) on investments	—			976			103,274			367			104,617
Net realized and unrealized gains (losses) on derivative instruments	—			—			906			—			906
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	—			—			(229,742		)	—			(229,742		)
Income (loss) from investment fund affiliates	—			—			13,179			—			13,179
Fee income and other	—			—			10,862			—			10,862
Total revenues	$	64		$	4,072		$	2,642,438		$	848		$	2,647,422
Expenses:
Net losses and loss expenses incurred	$	—		$	—		$	1,632,386		$	—		$	1,632,386
Claims and policy benefits	—			—			5,482			—			5,482
Acquisition costs	—			—			420,520			—			420,520
Operating expenses	(499		)	1,071			521,949			—			522,521
Exchange (gains) losses	(470		)	(136		)	(18,494		)	—			(19,100		)
Interest expense	(9		)	35,177			20,570			—			55,738
Total expenses	$	(978	)	$	36,112		$	2,582,413		$	—		$	2,617,547
Income (loss) before income tax and income (loss) from operating affiliates	$	1,042		$	(32,040	)	$	60,025		$	848		$	29,875
Income (loss) from operating affiliates	—			—			21,418			—			21,418
Equity in net earnings (losses) of subsidiaries	42,740			78,114			—			(120,854		)	—
Provision (benefit) for income tax	—			—			2,467			—			2,467
Net income (loss)	$	43,782		$	46,074		$	78,976		$	(120,006	)	$	48,826
Non-controlling interests	—			3,334			1,710			—			5,044
Net income (loss) attributable to common shareholders	$	43,782		$	42,740		$	77,266		$	(120,006	)	$	43,782
Comprehensive income (loss)	$	357,812		$	356,770		$	391,296		$	(748,066	)	$	357,812

	Six Months Ended June 30, 2017
Condensed Consolidating Statement of Income and Comprehensive Income (U.S. dollars in thousands, except per share data)	XL Group (1)			XLIT			Other XL Group Subsidiaries			Consolidating Adjustments and Eliminations			XL Group Consolidated
Revenues:
Net premiums earned	$	—		$	—		$	5,039,708		$	—		$	5,039,708
Total net investment income	94			4,416			404,790			(94		)	409,206
Total net realized gains (losses) on investments	—			669			93,245			—			93,914
Net realized and unrealized gains (losses) on derivative instruments	—			—			(7,975		)	—			(7,975		)
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	—			—			(84,697		)	—			(84,697		)
Income (loss) from investment fund affiliates	—			—			69,079			—			69,079
Fee income and other	—			—			23,886			—			23,886
Total revenues	$	94		$	5,085		$	5,538,036		$	(94	)	$	5,543,121
Expenses:
Net losses and loss expenses incurred	$	—		$	—		$	3,112,539		$	—		$	3,112,539
Claims and policy benefits	—			—			14,886			—			14,886
Acquisition costs	—			—			869,453			—			869,453
Operating expenses	43,570			1,661			895,585			—			940,816
Exchange (gains) losses	1,112			27			(10,118		)	—			(8,979		)
Interest expense	—			70,424			34,305			—			104,729
Total expenses	$	44,682		$	72,112		$	4,916,650		$	—		$	5,033,444
Income (loss) before income tax and income (loss) from operating affiliates	$	(44,588	)	$	(67,027	)	$	621,386		$	(94	)	$	509,677
Income (loss) from operating affiliates	—			—			56,313			—			56,313
Equity in net earnings (losses) of subsidiaries	499,051			602,367			—			(1,101,418		)	—
Provision (benefit) for income tax	—			—			42,098			—			42,098
Net income (loss)	$	454,463		$	535,340		$	635,601		$	(1,101,512	)	$	523,892
Non-controlling interests	—			36,289			33,234			(94		)	69,429
Net income (loss) attributable to common shareholders	$	454,463		$	499,051		$	602,367		$	(1,101,418	)	$	454,463
Comprehensive income (loss)	$	660,082		$	704,670		$	807,986		$	(1,512,656	)	$	660,082

____________

(1) Results for the period include XL-Ireland, which prior to the Redomestication was the ultimate parent and is now in liquidation proceedings as outlined in Note 1, "Significant Accounting Policies." The Company expects the net assets of XL-Ireland to ultimately be distributed to XL Group upon completion of the liquidation.

	Six Months Ended June 30, 2016
Condensed Consolidating Statement of Income and Comprehensive Income (U.S. dollars in thousands, except per share data)	XL- Ireland			XLIT			Other XL-Ireland Subsidiaries			Consolidating Adjustments and Eliminations			XL-Ireland Consolidated
Revenues:
Net premiums earned	$	—		$	—		$	4,886,822		$	—		$	4,886,822
Total net investment income	177			4,881			415,054			1,162			421,274
Total net realized gains (losses) on investments	—			1,253			194,214			1,900			197,367
Net realized and unrealized gains (losses) on derivative instruments	—			—			(2,716		)	—			(2,716		)
Net realized and unrealized gains (losses) on life retrocession embedded derivative and derivative instruments - Life Funds Withheld Assets	—			—			(465,822		)	—			(465,822		)
Income (loss) from investment fund affiliates	—			—			8,600			—			8,600
Fee income and other	—			—			19,124			—			19,124
Total revenues	$	177		$	6,134		$	5,055,276		$	3,062		$	5,064,649
Expenses:
Net losses and loss expenses incurred	$	—		$	—		$	3,014,871		$	—		$	3,014,871
Claims and policy benefits	—			—			10,419			—			10,419
Acquisition costs	—			—			823,787			—			823,787
Operating expenses	2,775			2,566			1,032,561			—			1,037,902
Exchange (gains) losses	(453		)	(172		)	(52,294		)	—			(52,919		)
Loss on sale of life reinsurance subsidiary	—			—			—			—			—
Extinguishment of debt	—			—			—			—			—
Interest expense	(15		)	70,346			37,710			—			108,041
Total expenses	$	2,307		$	72,740		$	4,867,054		$	—		$	4,942,101
Income (loss) before income tax and income (loss) from operating affiliates	$	(2,130	)	$	(66,606	)	$	188,222		$	3,062		$	122,548
Income (loss) from operating affiliates	—			—			34,068			—			34,068
Gain on sale of operating affiliate	—			—			—			—			—
Equity in net earnings (losses) of subsidiaries	67,177			172,894			—			(240,071		)	—
Provision (benefit) for income tax	(620		)	—			25,382			—			24,762
Net income (loss)	$	65,667		$	106,288		$	196,908		$	(237,009	)	$	131,854
Non-controlling interests	—			39,111			27,076			—			66,187
Net income (loss) attributable to common shareholders	$	65,667		$	67,177		$	169,832		$	(237,009	)	$	65,667
Comprehensive income (loss)	$	787,638		$	789,148		$	891,803		$	(1,680,951	)	$	787,638

Guarantor cash flow

	Six Months Ended June 30, 2017
Condensed Consolidating Statement of Cash Flows (U.S. dollars in thousands)	XL Group (1)			XLIT			Other XL Group Subsidiaries			Consolidating Adjustments and Eliminations			XL Group Consolidated
Cash flows provided by (used in) operating activities:
Net cash provided by (used in) operating activities	$	286,697		$	332,788		$	(52,744	)	$	(695,987	)	$	(129,246	)
Cash flows provided by (used in) investing activities:
Proceeds from sale of fixed maturities and short-term investments	$	—		$	81,662		$	6,305,948		$	—		$	6,387,610
Proceeds from redemption of fixed maturities and short-term investments	—			82,392			2,001,790			—			2,084,182
Proceeds from sale of equity securities	—			677			228,237			—			228,914
Purchases of fixed maturities and short-term investments	—			(143,851		)	(8,575,173		)	—			(8,719,024		)
Purchases of equity securities	—			—			(277,329		)	—			(277,329		)
Proceeds from sale of affiliates	—			—			236,861			—			236,861
Purchases of affiliates	—			—			(51,891		)	—			(51,891		)
Returns of capital from subsidiaries	237,013			—			—			(237,013		)	—
Change in restricted cash	—			—			(27,726		)	—			(27,726		)
Other, net	—			—			5,127			—			5,127
Net cash provided by (used in) investing activities	$	237,013		$	20,880		$	(154,156	)	$	(237,013	)	$	(133,276	)
Cash flows provided by (used in) financing activities:
Proceeds from issuance of common shares and exercise of stock options	$	42,630		$	—		$	—		$	—		$	42,630
Buybacks of common shares	(450,629		)	—			—			—			(450,629		)
Employee withholding on share-based compensation	—			—			(23,957		)	—			(23,957		)
Dividends paid on common shares	(115,589		)	(295,987		)	(400,000		)	695,987			(115,589		)
Return of capital	—			(237,013		)	—			237,013			—
Distributions to non-controlling interests	—			(39,867		)	(33,841		)	—			(73,708		)
Contributions from non-controlling interests	—			—			25			—			25
Proceeds from issuance of debt	—			558,311			—			—			558,311
Deposit liabilities	—			—			(11,150		)	—			(11,150		)
Net cash provided by (used in) financing activities	$	(523,588	)	$	(14,556	)	$	(468,923	)	$	933,000		$	(74,067	)
Effects of exchange rate changes on foreign currency cash	—			—			43,423			—			43,423
Increase (decrease) in cash and cash equivalents	$	122		$	339,112		$	(632,400	)	$	—		$	(293,166	)
Cash and cash equivalents – beginning of period	1,022			84,286			3,341,680			—			3,426,988
Cash and cash equivalents – end of period	$	1,144		$	423,398		$	2,709,280		$	—		$	3,133,822

____________

(1) Results for the period include XL-Ireland, which prior to the Redomestication was the ultimate parent and is now in liquidation proceedings as outlined in Note 1, "Significant Accounting Policies." The Company expects the net assets of XL-Ireland to ultimately be distributed to XL Group upon completion of the liquidation.

	Six Months Ended June 30, 2016
Condensed Consolidating Statement of Cash Flows (U.S. dollars in thousands)	XL- Ireland			XLIT			Other XL-Ireland Subsidiaries			Consolidating Adjustments and Eliminations			XL-Ireland Consolidated
Cash flows provided by (used in) operating activities:
Net cash provided by (used in) operating activities	$	665,895		$	656,809		$	(472,440	)	$	(655,063	)	$	195,201
Cash flows provided by (used in) investing activities:
Proceeds from sale of fixed maturities and short-term investments	$	—		$	231,600		$	7,796,365		$	(578,010	)	$	7,449,955
Proceeds from redemption of fixed maturities and short-term investments	—			42,744			2,045,573			—			2,088,317
Proceeds from sale of equity securities	—			—			114,958			—			114,958
Purchases of fixed maturities and short-term investments	—			(515,794		)	(8,418,324		)	578,010			(8,356,108		)
Purchases of equity securities	—			—			(255,442		)	—			(255,442		)
Proceeds from sale of affiliates	—			—			153,928			—			153,928
Purchases of affiliates	—			—			(408,886		)	—			(408,886		)
Purchase of subsidiaries, net of acquired cash	—			—			(69,745		)	—			(69,745		)
Returns of capital from subsidiaries	132,374			—			—			(132,374		)	—
Change in restricted cash	—			—			(26,866		)	—			(26,866		)
Other, net	—			—			108,095			—			108,095
Net cash provided by (used in) investing activities	$	132,374		$	(241,450	)	$	1,039,656		$	(132,374	)	$	798,206
Cash flows provided by (used in) financing activities:
Proceeds from issuance of common shares and exercise of stock options	$	1,727		$	—		$	—		$	—		$	1,727
Buybacks of common shares	(684,386		)	—			—			—			(684,386		)
Employee withholding on share-based compensation	—			—			(27,947		)	—			(27,947		)
Dividends paid on common shares	(113,731		)	(655,063		)	—			655,063			(113,731		)
Return of capital	—			(132,374		)	—			132,374			—
Distributions to non-controlling interests	—			(38,862		)	(26,820		)	—			(65,682		)
Contributions from non-controlling interests	—			—			1,130			—			1,130
Repayment of debt	—			—			(8,248		)	—			(8,248		)
Net proceeds from affiliated notional cash pooling programs (1)	—			174,654			—			(174,654		)	—
Deposit liabilities	—			—			(14,807		)	—			(14,807		)
Net cash provided by (used in) financing activities	$	(796,390	)	$	(651,645	)	$	(76,692	)	$	612,783		$	(911,944	)
Effects of exchange rate changes on foreign currency cash	—			—			(20,950		)	—			(20,950		)
Increase (decrease) in cash and cash equivalents	$	1,879		$	(236,286	)	$	469,574		$	(174,654	)	$	60,513
Cash and cash equivalents – beginning of period	11,557			369,997			2,874,682			—			3,256,236
Cash and cash equivalents – end of period	$	13,436		$	133,711		$	3,344,256		$	(174,654	)	$	3,316,749

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(1) Net proceeds from affiliated notional cash pooling arrangements reflect the net impact of bank transfers to settle overdraft positions within the Company's multi-currency cash pool.