Investments in affiliates

The following table presents the Company's investments in affiliates as at September 30, 2016 and December 31, 2015:



	September 30, 2016		December 31, 2015
Investment affiliate	$	99,731	$	87,673
Operating affiliate	—		392
Investments in affiliates	$	99,731	$	88,065


(a)	Investment affiliate

Aquiline Financial Services Fund II L.P.

On December 20, 2011, the Company entered into an Assignment and Assumption Agreement (the "Agreement") with Aquiline Capital Partners LLC, a Delaware limited liability company ("Aquiline Capital") and Aquiline Capital Partners II GP (Offshore) Ltd., a Cayman Islands company limited by shares (the "Aquiline II General Partner") pursuant to which the Company has assumed 100% of Aquiline Capital's interest in Aquiline Financial Services Fund II L.P. (the "Aquiline II Partnership") representing a total capital commitment of $50,000 (the "Aquiline II Commitment"), as a limited partner in the Partnership (the "Transferred Interest"). The Transferred Interest is governed by the terms of an Amended and Restated Exempted Limited Partnership Agreement of the Fund dated January 9, 2013 (the "Aquiline II Limited Partnership Agreement").

On October 2, 2014, the Company assumed an additional investment in the Aquiline II Partnership as part of the Western World acquisition representing a total capital commitment of $10,000. This interest is also governed by the terms of the Aquiline II Limited Partnership Agreement.

The Aquiline II Partnership is a VIE and the Company is not the primary beneficiary. Therefore, the Company's investment in the Aquiline II Partnership has been treated as an equity method investment. The Aquiline II Partnership provides a quarterly capital account statement, with a three month delay in its valuation, which was used as the basis for calculating the Company's share of the Aquiline II Partnership income for the period.

In accordance with the terms of the Agreement, no limited partner has the right to withdraw from the Aquiline II Partnership or to withdraw any part of its capital account without prior consent from the Aquiline II General Partner. The Company's maximum exposure to the Aquiline II Partnership is limited to the amount invested and any remaining capital commitment. Refer to Note 15, "Commitments and contingencies," for further details.

Aquiline Financial Services Fund III L.P.

On November 7, 2014, the Company, entered into a Subscription Agreement (the "Subscription Agreement") with Aquiline Capital Partners III GP (Offshore) Ltd., a Cayman Islands company limited by shares (the "Aquiline III General Partner") pursuant to which the Company committed and agreed to purchase limited partnership or other comparable limited liability equity interests (the "Limited Partnership Interests") in Aquiline Financial Services Fund III L.P., a Cayman Islands exempted limited partnership (the "Aquiline III Partnership"), and/or one or more Alternative Investment Vehicles and Intermediate Entities (together with the Aquiline III Partnership, the "Aquiline Fund" or the "Entities") with a capital commitment (the "Aquiline III Commitment") in an amount equal to $100,000, as a limited partner in the Aquiline III Partnership. The Limited Partnership Interests are governed by the terms of an Amended and Restated Exempted Limited Partnership Agreement dated as of November 7, 2014 (the “Aquiline III Limited Partnership Agreement”).

The Aquiline III Partnership is a VIE and the Company is not the primary beneficiary. Therefore, the Company's investment in the Aquiline III Partnership has been treated as an equity method investment. The Aquiline III Partnership provides a quarterly capital account statement, with a three month delay in its valuation, which was used as the basis for calculating the Company's share of Aquiline III Partnership income for the period.

In accordance with the terms of the Agreement, no limited partner has the right to withdraw from the Aquiline III Partnership or to withdraw any part of its capital account without prior consent from the Aquiline III General Partner. The Company's maximum exposure to the Aquiline III Partnership is limited to the amount invested and any remaining capital commitment. Refer to Note 15, "Commitments and contingencies," for further details.

The following table presents a reconciliation of the beginning and ending investment in the Company's investment affiliate balance for the three and nine months ended September 30, 2016 and 2015:



	Three Months Ended September 30,					Nine Months Ended September 30,
	2016		2015			2016			2015
Investment affiliate, beginning of period	$	99,278	$	89,681		$	87,673		$	63,506
Net capital contributions	—		(4,029		)	16,307			19,086
(Loss) income from investment affiliate	453		2,482			(4,249		)	5,542
Investment affiliate, end of period	$	99,731	$	88,134		$	99,731		$	88,134

The following table presents the Company’s investment in the partnerships as at September 30, 2016 and December 31, 2015:



	Investment at cost		Voting ownership %		Equity ownership %		Carrying value
As at September 30, 2016
Aquiline Financial Services Fund II L.P.	$	56,479	—	%	8.1	%	$	70,345
Aquiline Financial Services Fund III L.P.	29,826		—	%	9.0	%	29,386
Total	$	86,305					$	99,731

As at December 31, 2015
Aquiline Financial Services Fund II L.P.	$	55,904	—	%	8.1	%	$	73,880
Aquiline Financial Services Fund III L.P.	13,890		—	%	13.7	%	13,793
Total	$	69,794					$	87,673


(b)	Operating affiliate

PaCRe, Ltd.

On April 2, 2012, the Company joined with other investors in capitalizing PaCRe, a Class 4 Bermuda reinsurer formed for the purpose of writing high excess property catastrophe reinsurance. During the fourth quarter of 2015, PaCRe's Class 4 license was surrendered and the company was considered off-risk effective January 1, 2016. The final distribution of the Company’s investment occurred during the three months ended June 30, 2016 and PaCRe was dissolved during the three months ended September 30, 2016. The Company's investment in PaCRe was treated as an equity method investment and the maximum exposure to the fund was the amount of capital invested at any given time.

The following table presents a reconciliation of the beginning and ending investment in the Company's operating affiliate balance for the three and nine months ended September 30, 2016 and 2015:



	Three Months Ended September 30,					Nine Months Ended September 30,
	2016		2015			2016			2015
Operating affiliate, beginning of period	$	—	$	56,666		$	392		$	50,944
Return of investment	—		—			(369		)	—
(Loss) income from operating affiliate	—		(7,963		)	(23		)	(2,241		)
Operating affiliate, end of period	$	—	$	48,703		$	—		$	48,703

The following table presents the Company’s investment in PaCRe as at December 31, 2015:



	Investment at cost		Voting ownership %		Equity ownership %		Carrying value
Investment in PaCRe	$	392	100.0	%	10.0	%	$	392