Segment Reporting

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Segment Reporting

12. SEGMENT REPORTING

The Reinsurance operation writes worldwide property and casualty reinsurance and specialty lines of business, on both a treaty and facultative basis, through reinsurance brokers, as well as directly with ceding companies. Business is written in the United States as well as through branches in Canada and Singapore. The Insurance operation writes property and casualty insurance directly and through brokers, surplus lines brokers and general agents within the United States.

These segments are managed independently, but conform with corporate guidelines with respect to pricing, risk management, control of aggregate catastrophe exposures, capital, investments and support operations. Management generally monitors and evaluates the financial performance of these operating segments based upon their underwriting results.

Underwriting results include earned premium less losses and LAE incurred, commission and brokerage expenses and other underwriting expenses. The Company measures its underwriting results using ratios, in particular loss, commission and brokerage and other underwriting expense ratios, which, respectively, divide incurred losses, commissions and brokerage and other underwriting expenses by premiums earned.

The Company does not maintain separate balance sheet data for its operating segments. Accordingly, the Company does not review and evaluate the financial results of its operating segments based upon balance sheet data.

The following tables present the underwriting results for the operating segments for the periods indicated:

	Three Months Ended				Six Months Ended
Reinsurance	June 30,				June 30,
(Dollars in thousands)	2021		2020		2021		2020
Gross written premiums	$	1,439,254	$	1,124,895	$	2,859,337	$	2,433,089
Net written premiums		1,291,229		992,750		2,500,042		2,106,984
Premiums earned	$	1,232,157	$	1,062,833	$	2,409,327	$	2,069,868
Incurred losses and LAE		739,440		630,658		1,709,757		1,313,366
Commission and brokerage		324,989		292,286		615,545		553,187
Other underwriting expenses		32,999		26,599		69,288		56,446
Underwriting gain (loss)	$	134,729	$	113,290	$	14,737	$	146,869

	Three Months Ended				Six Months Ended
Insurance	June 30,				June 30,
(Dollars in thousands)	2021		2020		2021		2020
Gross written premiums	$	877,776	$	713,352	$	1,591,028	$	1,380,123
Net written premiums		637,106		508,801		1,193,636		1,033,275
Premiums earned	$	534,398	$	476,127	$	1,054,128	$	963,097
Incurred losses and LAE		356,177		345,174		739,944		691,979
Commission and brokerage		61,859		63,413		121,157		125,616
Other underwriting expenses		76,932		67,532		150,437		138,893
Underwriting gain (loss)	$	39,430	$	8	$	42,590	$	6,609

The following table reconciles the underwriting results for the operating segments to income (loss) before taxes as reported in the consolidated statements of operations and comprehensive income (loss) for the periods indicated:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(Dollars in thousands)	2021		2020		2021		2020
Underwriting gain (loss)	$	174,159	$	113,298	$	57,327	$	153,478
Net investment income		248,135		35,153		395,858		109,354
Net realized capital gains (losses)		183,763		(479,360)		318,774		(222,493)
Corporate expense		(7,618)		(3,514)		(12,199)		(7,235)
Interest, fee and bond issue cost amortization expense		(15,537)		(6,922)		(31,071)		(14,382)
Other income (expense)		(1,867)		(5,122)		2,112		(9,620)
Income (loss) before taxes	$	581,035	$	(346,467)	$	730,800	$	9,102

The Company produces business in the U.S. and internationally. The net income deriving from assets residing in the individual foreign countries in which the Company writes business are not identifiable in the Company’s financial records. Based on gross written premium, the table below presents the largest country, other than the U.S., in which the Company writes business, for the periods indicated:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(Dollars in thousands)	2021		2020		2021		2020
Canada gross written premiums	$	68,955	$	71,021	$	103,285	$	134,658

No other country represented more than 5% of the Company’s revenues.