Ceded Reinsurance

12 Months Ended

Dec. 31, 2014

Reinsurance Disclosures [Abstract]

Ceded reinsurance

CEDED REINSURANCE

The Company purchases reinsurance from third-party reinsurance companies to reduce its net exposure to losses. Reinsurance provides for recovery of a portion of gross losses and loss expenses from these reinsurers. The Company remains liable to the extent that its reinsurers do not meet their obligations under the related reinsurance contracts. The Company therefore regularly evaluates the financial condition of its reinsurers and monitors concentration of credit risk. The Company believes that as of December 31, 2014, its reinsurers are able to meet, and will meet, all of their obligations under the agreements. No material provision has been made for unrecoverable reinsurance as of December 31, 2014 and 2013. The amount of reinsurance recoverable is as follows:

	2014		2013
OSLR recoverable	$	232,545	$	225,796
IBNR recoverable	1,107,711		1,008,708
Reinsurance recoverable	$	1,340,256	$	1,234,504
Reinsurance recoverable on paid losses	$	86,075	$	76,099

Direct, assumed and ceded premiums written and earned and losses and loss expenses incurred are as follows:

	Premiums Written			Premiums Earned			Losses and Loss Expenses
Year Ended December 31, 2014
Direct	$	1,996,831		$	1,835,186		$	1,031,284
Assumed	938,594			941,182			464,728
Ceded	(613,350		)	(593,610		)	(296,822		)
	$	2,322,075		$	2,182,758		$	1,199,190
Year Ended December 31, 2013
Direct	$	1,804,910		$	1,664,343		$	936,084
Assumed	933,754			896,088			430,627
Ceded	(618,183		)	(554,598		)	(243,469		)
	$	2,120,481		$	2,005,833		$	1,123,242
Year Ended December 31, 2012
Direct	$	1,569,021		$	1,446,086		$	877,961
Assumed	760,250			743,575			513,871
Ceded	(491,448		)	(440,763		)	(252,568		)
	$	1,837,823		$	1,748,898		$	1,139,264

Of the premiums ceded during the years ended December 31, 2014, 2013 and 2012, approximately 42%, 45% and 48% were ceded to four reinsurers, respectively.

The Company actively manages its reinsurance exposures by generally selecting reinsurers having a credit rating of A- or higher and monitoring the overall credit quality of its reinsurers to ensure the recoverables will be collected.

	December 31, 2014					December 31, 2013
	A.M. Best Rating	Reinsurance Recoverable		Percentage of Total		A.M. Best Rating	Reinsurance Recoverable		Percentage of Total
Munich Re	A+	$	285,918	21.3	%	A+	$	214,070	17.3	%
Axis Capital	A+	148,371		11.1	%	A+	143,063		11.6	%
Arch Re	A+	128,421		9.6	%	A+	143,037		11.6	%
Markel	A	86,595		6.5	%	A	86,462		7.0	%
XL Group	A	78,377		5.8	%	A	68,857		5.6	%
Top five reinsurers		727,682		54.3	%		655,489		53.1	%
Other reinsurers’ balances		612,574		45.7	%		579,015		46.9	%
Total reinsurance recoverable		$	1,340,256	100.0	%		$	1,234,504	100.0	%

Approximately 99% of ceded reserves were recoverable from reinsurers who had an A.M. Best rating of “A-” or higher as of December 31, 2014 and 2013.