REINSURANCE

12 Months Ended

Dec. 31, 2021

In the normal course of business, the Company purchases treaty and facultative reinsurance protection to limit ultimate losses from catastrophic events and reduce loss aggregation risk.

Facultative reinsurance provides cover for all or a portion of the losses incurred for a single policy and the Company separately negotiates each facultative contract.

Treaty reinsurance provides cover for a specified type or category of risks. The Company's treaty reinsurance agreements provide this cover on either an excess of loss or a proportional basis. Excess of loss covers provide a contractually set amount of coverage after a specified loss amount has been reached. These treaties can provide cover for a number of lines of business within one contract. Under proportional reinsurance, the Company cedes an agreed percentage of the premiums and the losses and loss expenses on the policies it underwrites. These treaties provide the Company with a specified percentage of coverage from the first dollar of loss.

All of these reinsurance contracts provide the Company with the right to recover a specified amount of losses and loss expenses from reinsurers. To the extent that reinsurers do not meet their obligations under these agreements due to solvency issues, contractual disputes over contract language or coverage and/or other reasons, the Company remains liable. The Company predominantly cedes its business to reinsurers rated A- or better by A.M. Best.

The following table presents gross and net premiums written and earned:



Year ended December 31,	2021				2020				2019
	Premiums written		Premiums earned		Premiums written		Premiums earned		Premiums written		Premiums earned

Gross	$	7,685,984	$	7,281,709	$	6,826,938	$	6,768,733	$	6,898,858	$	6,910,677
Ceded	(2,759,360)		(2,571,859)		(2,490,529)		(2,397,424)		(2,409,243)		(2,323,499)
Net	$	4,926,624	$	4,709,850	$	4,336,409	$	4,371,309	$	4,489,615	$	4,587,178

For the year ended December 31, 2021, the Company recognized ceded losses and loss expenses of $1,782 million (2020: $1,914 million; 2019: $1,602 million).

At December 31, 2021, the Company's allowance for expected credit losses was $30 million (2020: $24 million; 2019: $18 million).