Business Segments (Tables)

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

Significant components of the Company's continuing operations and selected balance sheet items

The Company's results of operations and selected balance sheet items by segment are presented in the following tables.

Three months ended June 30, 2020	Specialty			Commercial			International			Life & Group		Corporate & Other
(In millions)															Eliminations			Total
Operating revenues
Net earned premiums	$	705		$	795		$	224		$	126	$	—		$	—		$	1,850
Net investment income	133			177			14			206		4			—			534
Non-insurance warranty revenue	308			—			—			—		—			—			308
Other revenues	—			5			—			—		1			(1		)	5
Total operating revenues	1,146			977			238			332		5			(1		)	2,697
Claims, benefits and expenses
Net incurred claims and benefits	508			666			176			304		(18		)	—			1,636
Policyholders’ dividends	1			5			—			—		—			—			6
Amortization of deferred acquisition costs	153			147			42			—		—			—			342
Non-insurance warranty expense	285			—			—			—		—			—			285
Other insurance related expenses	73			124			39			25		(1		)	—			260
Other expenses	10			13			(2		)	—		35			(1		)	55
Total claims, benefits and expenses	1,030			955			255			329		16			(1		)	2,584
Core income (loss) before income tax	116			22			(17		)	3		(11		)	—			113
Income tax (expense) benefit on core income (loss)	(26		)	(2		)	3			11		—			—			(14		)
Core income (loss)	$	90		$	20		$	(14	)	$	14	$	(11	)	$	—		99
Net investment gains (losses)																		69
Income tax (expense) benefit on net investment gains (losses)																		(17		)
Net investment gains (losses), after tax																		52
Net income (loss)																		$	151

Three months ended June 30, 2019	Specialty			Commercial			International			Life & Group			Corporate & Other
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	688		$	763		$	243		$	130		$	—		$	—		$	1,824
Net investment income	134			154			15			205			7			—			515
Non-insurance warranty revenue	285			—			—			—			—			—			285
Other revenues	(1		)	3			1			—			2			(1		)	4
Total operating revenues	1,106			920			259			335			9			(1		)	2,628
Claims, benefits and expenses
Net incurred claims and benefits	395			507			147			309			(12		)	—			1,346
Policyholders’ dividends	1			5			—			—			—			—			6
Amortization of deferred acquisition costs	152			130			56			—			—			—			338
Non-insurance warranty expense	263			—			—			—			—			—			263
Other insurance related expenses	76			119			34			30			(1		)	—			258
Other expenses	12			7			3			2			34			(1		)	57
Total claims, benefits and expenses	899			768			240			341			21			(1		)	2,268
Core income (loss) before income tax	207			152			19			(6		)	(12		)	—			360
Income tax (expense) benefit on core income (loss)	(46		)	(32		)	(2		)	13			1			—			(66		)
Core income (loss)	$	161		$	120		$	17		$	7		$	(11	)	$	—		294
Net investment gains (losses)																			(18		)
Income tax (expense) benefit on net investment gains (losses)																			2
Net investment gains (losses), after tax																			(16		)
Net income (loss)																			$	278

Six months ended June 30, 2020	Specialty			Commercial			International			Life & Group			Corporate & Other
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	1,390		$	1,613		$	463		$	253		$	—		$	—		$	3,719
Net investment income	189			224			29			414			7			—			863
Non-insurance warranty revenue	609			—			—			—			—			—			609
Other revenues	1			12			—			—			3			(3		)	13
Total operating revenues	2,189			1,849			492			667			10			(3		)	5,204
Claims, benefits and expenses
Net incurred claims and benefits	913			1,224			330			620			(32		)	—			3,055
Policyholders’ dividends	2			10			—			—			—			—			12
Amortization of deferred acquisition costs	304			291			91			—			—			—			686
Non-insurance warranty expense	566			—			—			—			—			—			566
Other insurance related expenses	142			251			75			51			(1		)	—			518
Other expenses	23			19			11			3			74			(3		)	127
Total claims, benefits and expenses	1,950			1,795			507			674			41			(3		)	4,964
Core income (loss) before income tax	239			54			(15		)	(7		)	(31		)	—			240
Income tax (expense) benefit on core income (loss)	(53		)	(10		)	3			25			2			—			(33		)
Core income (loss)	$	186		$	44		$	(12	)	$	18		$	(29	)	$	—		207
Net investment gains (losses)																			(147		)
Income tax (expense) benefit on net investment gains (losses)																			30
Net investment gains (losses), after tax																			(117		)
Net income (loss)																			$	90

June 30, 2020
(In millions)
Reinsurance receivables	$	897	$	925	$	246	$	407	$	1,984	$	—	$	4,459
Insurance receivables	1,035		1,429		313		10		1		—		2,788
Deferred acquisition costs	315		293		91		—		—		—		699
Goodwill	117		—		28		—		—		—		145
Deferred non-insurance warranty acquisition expense	2,916		—		—		—		—		—		2,916
Insurance reserves
Claim and claim adjustment expenses	5,696		8,830		1,906		3,751		2,087		—		22,270
Unearned premiums	2,424		1,927		517		128		—		—		4,996
Future policy benefits	—		—		—		12,596		—		—		12,596
Deferred non-insurance warranty revenue	3,852		—		—		—		—		—		3,852

Six months ended June 30, 2019	Specialty			Commercial			International			Life & Group			Corporate & Other
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	1,349		$	1,526		$	493		$	260		$	—		$	(1	)	$	3,627
Net investment income	289			344			30			409			14			—			1,086
Non-insurance warranty revenue	566			—			—			—			—			—			566
Other revenues	—			10			1			1			4			(3		)	13
Total operating revenues	2,204			1,880			524			670			18			(4		)	5,292
Claims, benefits and expenses
Net incurred claims and benefits	787			1,017			309			617			(33		)	—			2,697
Policyholders’ dividends	2			10			—			—			—			—			12
Amortization of deferred acquisition costs	299			257			124			—			—			—			680
Non-insurance warranty expense	523			—			—			—			—			—			523
Other insurance related expenses	146			249			59			58			(2		)	(1		)	509
Other expenses	24			18			7			4			73			(3		)	123
Total claims, benefits and expenses	1,781			1,551			499			679			38			(4		)	4,544
Core income (loss) before income tax	423			329			25			(9		)	(20		)	—			748
Income tax (expense) benefit on core income (loss)	(93		)	(70		)	(2		)	26			3			—			(136		)
Core income (loss)	$	330		$	259		$	23		$	17		$	(17	)	$	—		612
Net investment gains (losses)																			13
Income tax (expense) benefit on net investment gains (losses)																			(5		)
Net investment gains (losses), after tax																			8
Net income (loss)																			$	620

December 31, 2019
(In millions)
Reinsurance receivables	$	575	$	855	$	247	$	385	$	2,142	$	—	$	4,204
Insurance receivables	971		1,210		284		16		—		—		2,481
Deferred acquisition costs	311		257		94		—		—		—		662
Goodwill	117		—		30		—		—		—		147
Deferred non-insurance warranty acquisition expense	2,840		—		—		—		—		—		2,840
Insurance reserves
Claim and claim adjustment expenses	5,238		8,656		1,876		3,716		2,234		—		21,720
Unearned premiums	2,337		1,626		495		125		—		—		4,583
Future policy benefits	—		—		—		12,311		—		—		12,311
Deferred non-insurance warranty revenue	3,779		—		—		—		—		—		3,779

Revenues by line of business

The following table presents operating revenue by line of business for each reportable segment.

Periods ended June 30	Three Months						Six Months
(In millions)	2020			2019			2020			2019
Specialty
Management & Professional Liability	$	645		$	629		$	1,213		$	1,265
Surety	153			151			291			290
Warranty & Alternative Risks	348			326			685			649
Specialty revenues	1,146			1,106			2,189			2,204
Commercial
Middle Market	355			351			690			708
Construction (1)	275			241			525			489
Small Business	114			123			226			254
Other Commercial	233			205			408			429
Commercial revenues	977			920			1,849			1,880
International
Canada	68			68			141			134
Europe	94			88			186			179
Hardy	76			103			165			211
International revenues	238			259			492			524
Life & Group revenues	332			335			667			670
Corporate & Other revenues	5			9			10			18
Eliminations	(1		)	(1		)	(3		)	(4		)
Total operating revenues	2,697			2,628			5,204			5,292
Net investment gains (losses)	69			(18		)	(147		)	13
Total revenues	$	2,766		$	2,610		$	5,057		$	5,305

(1)

Effective January 1, 2020, the Construction line of business is presented separately in the Commercial segment to better align with the Company's underwriting expertise and the manner in which the products are sold. Prior period information has been conformed to the new line of business presentation.