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Retirement Plans (Tables)

12 Months Ended

Dec. 31, 2017

The funded status by geographical region of all the Company's retirement plans at December 31, 2017 and 2016 is as follows:



Funded Status (U.S. dollars in thousands)	2017			2016
U.S.	$	(13,700	)	$	(14,093	)
U.K.	1,606			(2,316		)
Other European	(26,484		)	(26,377		)
Funded status – end of year	$	(38,578	)	$	(42,786	)



Change in projected benefit obligation (U.S. dollars in thousands)	2017			2016			2015
Projected benefit obligation – beginning of year	$	120,038		$	122,165		$	93,124
Projected benefit obligation assumed due to Catlin Acquisition	—			—			28,414
Service cost (1)	1,296			1,701			1,494
Interest cost	3,620			5,126			4,382
Actuarial (gain) / loss	(958		)	7,948			2,821
Benefits and expenses paid	(5,831		)	(5,977		)	(3,747		)
Foreign currency (gains) / losses	7,531			(10,248		)	(4,047		)
Settlements	(1,270		)	(677		)	(276		)
Projected benefit obligation – end of year	$	124,426		$	120,038		$	122,165

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(1)	Service costs include cost of living adjustments on curtailed plans.



Change in plan assets (U.S. dollars in thousands)	2017			2016			2015
Fair value of plan assets – beginning of year	$	77,252		$	79,402		$	49,281
Fair value of plan assets acquired due to Catlin Acquisition	—			—			33,131
Actual return on plan assets	7,900			8,499			(119		)
Employer contributions	1,588			2,077			1,775
Benefits and expenses paid	(4,769		)	(4,577		)	(3,305		)
Foreign currency gains / (losses)	3,877			(8,149		)	(1,361		)
Fair value of plan assets – end of year	$	85,848		$	77,252		$	79,402
Funded status – end of year	$	(38,578	)	$	(42,786	)	$	(42,763	)
Accrued pension liability	$	38,578		$	42,786		$	42,763

The components of the net benefit cost for the years ended December 31, 2017, 2016 and 2015 are as follows:



Components of net benefit cost (U.S. dollars in thousands)	2017			2016			2015
Service cost	$	1,296		$	1,701		$	1,494
Interest cost	3,620			5,126			4,382
Expected return on plan assets	(3,522		)	(4,357		)	(3,903		)
Amortization of net actuarial loss	2,158			1,705			1,617
Net benefit cost	$	3,552		$	4,175		$	3,590

The table below includes disclosure of these rates on a weighted-average basis, for the years ended December 31, 2017 and 2016 as indicated:



	2017						2016
	U.S. Plans		U.K. Plans		Other European Plans		U.S. Plans		U.K. Plans		Other European Plans
Net Benefit Cost – Weighted-average assumptions
Discount rate	4.04	%	2.56	%	2.00	%	4.25	%	2.74	%	1.33	%
Expected long-term rate of return on plan assets	6.00	%	2.57	%	N/A		6.00	%	2.77	%	N/A
Rate of compensation increase	N/A		3.51	%	2.50	%	N/A		3.62	%	2.50	%
Benefit Obligation – Weighted-average assumptions
Discount rate	3.49	%	2.56	%	2.00	%	4.04	%	2.76	%	1.33	%
Rate of compensation increase	N/A		3.51	%	2.50	%	N/A		3.62	%	2.50	%

The assets in the plans and the expected rates of return were as follows:



(U.S. dollars in thousands, except percentages)	Expected Return on Assets for 2017		Fair Value at December 31, 2017		Expected Return on Assets for 2016		Fair Value at December 31, 2016
Equities and growth funds	5.6	%	$	11,035	5.7	%	$	9,122
Gilts	1.9	%	15,785		2.4	%	15,459
Corporate bonds	2.6	%	16,021		3.3	%	13,850
Other (cash)	0.5	%	320		0.5	%	89
Total market fair value of assets			$	43,161			$	38,520

The estimated future benefit payments with respect to the U.S. defined benefit pension plans are as follows: