Segment Reporting

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Segment Reporting

16.  SEGMENT REPORTING

The U.S. Reinsurance operation writes property and casualty reinsurance and specialty lines of business, including Marine, Aviation, Surety and Accident and Health ("A&H") business, on both a treaty and facultative basis, through reinsurance brokers, as well as directly with ceding companies primarily within the U.S.  The International operation writes non-U.S. property and casualty reinsurance through Everest Re's branches in Canada and Singapore and through offices in Brazil, Miami and New Jersey. The Bermuda operation provides reinsurance and insurance to worldwide property and casualty markets through brokers and directly with ceding companies from its Bermuda office and reinsurance to the United Kingdom and European markets through its UK branch and Ireland Re.  The Insurance operation writes property and casualty insurance, including medical stop loss insurance, directly and through general agents, brokers and surplus lines brokers within the U.S. and Canada.  The Mt. Logan Re segment represents business written for the segregated accounts of Mt. Logan Re, which were formed on July 1, 2013.  The Mt. Logan Re business represents a diversified set of catastrophe exposures, diversified by risk/peril and across different geographical regions globally.

These segments, with the exception of Mt. Logan Re, 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.  The Mt. Logan Re segment is managed independently and seeks to write a diverse portfolio of catastrophe risks for each segregated account to achieve desired risk and return criteria.

Underwriting results include earned premium less losses and loss adjustment expenses ("LAE") incurred, commission and brokerage expenses and other underwriting expenses.  We measure our 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.

Mt. Logan Re's business is sourced through operating subsidiaries of the Company; however, the activity is only reflected in the Mt. Logan Re segment.  For other inter-affiliate reinsurance, business is generally reported within the segment in which the business was first produced, consistent with how the business is managed.

Except for Mt. Logan Re, 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
U.S. Reinsurance	March 31,
(Dollars in thousands)	2014		2013
Gross written premiums	$	495,641	$	434,791
Net written premiums		497,757		434,639
Premiums earned	$	429,641	$	392,616
Incurred losses and LAE		213,455		198,158
Commission and brokerage		92,968		87,326
Other underwriting expenses		9,482		10,534
Underwriting gain (loss)	$	113,736	$	96,598

	Three Months Ended
International	March 31,
(Dollars in thousands)	2014		2013
Gross written premiums	$	321,242	$	297,560
Net written premiums		309,037		293,982
Premiums earned	$	318,381	$	311,978
Incurred losses and LAE		163,174		161,199
Commission and brokerage		70,974		71,444
Other underwriting expenses		7,837		7,930
Underwriting gain (loss)	$	76,396	$	71,405

	Three Months Ended
Bermuda	March 31,
(Dollars in thousands)	2014		2013
Gross written premiums	$	183,415	$	195,758
Net written premiums		182,570		195,823
Premiums earned	$	173,686	$	185,333
Incurred losses and LAE		94,508		91,996
Commission and brokerage		45,708		43,651
Other underwriting expenses		8,286		7,759
Underwriting gain (loss)	$	25,184	$	41,927

	Three Months Ended
Insurance	March 31,
(Dollars in thousands)	2014		2013
Gross written premiums	$	230,650	$	252,681
Net written premiums		211,668		225,249
Premiums earned	$	203,237	$	198,832
Incurred losses and LAE		142,191		141,291
Commission and brokerage		34,209		30,625
Other underwriting expenses		23,233		26,723
Underwriting gain (loss)	$	3,604	$	193

	Three Months Ended
Mt. Logan Re	March 31,
(Dollars in thousands)	2014		2013
Gross written premiums	$	36,476	$	-
Net written premiums		26,557		-
Premiums earned	$	19,545	$	-
Incurred losses and LAE		6,081		-
Commission and brokerage		2,143		-
Other underwriting expenses		1,800		-
Underwriting gain (loss)	$	9,521	$	-

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

	Three Months Ended
	March 31,
(Dollars in thousands)	2014			2013
Underwriting gain (loss)	$	228,441		$	210,123
Net investment income		123,157			145,781
Net realized capital gains (losses)		21,126			126,735
Net derivative gain (loss)		(1,661	)		15,285
Corporate expenses		(4,945	)		(5,717	)
Interest, fee and bond issue cost amortization expense		(7,568	)		(13,481	)
Other income (expense)		(3,296	)		(8,887	)
Income (loss) before taxes	$	355,254		$	469,839

The Company produces business in the U.S., Bermuda and internationally.  The net income deriving from and 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 period indicated:

	Three Months Ended
	March 31,
(Dollars in thousands)	2014		2013
United Kingdom	$	206,783	$	147,987

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