Segments

6 Months Ended

Jun. 30, 2012

Segments [Abstract]

Segments

(8) Segments

We report HCC's results in six operating segments. Our insurance segments consist of the following:

• U.S. Property & Casualty
• Professional Liability
• Accident & Health
• U.S. Surety & Credit
• International

The Investing segment includes our consolidated investment portfolio, as well as all investment income, investment related expenses, realized investment gains and losses, and other-than-temporary impairment credit losses on investments. All investment activity is reported as revenue, consistent with our consolidated presentation.

In addition to our segments, we include a Corporate & Other category to reconcile segment results to consolidated totals. The Corporate & Other category includes corporate operating expenses not allocable to the segments, interest expense on long-term debt, foreign currency expense (benefit), and underwriting results of our Exited Lines. Our Exited Lines include product lines that we no longer write and do not expect to write in the future.

The following tables present information by business segment.

			U.S. Property & Casualty		Professional Liability		Accident & Health		U.S. Surety & Credit		International		Investing		Corporate & Other		Consolidated
Six months ended June 30, 2012
Net earned premium			$	177,852	$	200,905	$	436,397	$	100,844	$	196,472	$	0	$	2	$	1,112,472
Other revenue				6,885		267		2,496		415		2,135		116,950		191		129,339
	Segment revenue			184,737		201,172		438,893		101,259		198,607		116,950		193		1,241,811
Loss and LAE				100,927		134,323		324,717		26,723		79,623		0		(560)		665,753
Other expense				59,767		36,207		63,482		55,523		68,765		0		41,035		324,779
	Segment expense			160,694		170,530		388,199		82,246		148,388		-		40,475		990,532
		Segment pretax earnings (loss)	$	24,043	$	30,642	$	50,694	$	19,013	$	50,219	$	116,950	$	(40,282)	$	251,279

			U.S. Property & Casualty		Professional Liability		Accident & Health		U.S. Surety & Credit		International		Investing		Corporate & Other		Consolidated
Six months ended June 30, 2011
Net earned premium			$	159,175	$	203,174	$	400,657	$	101,403	$	168,164	$	0	$	158	$	1,032,731
Other revenue				9,666		249		2,194		701		1,902		101,033		84		115,829
	Segment revenue			168,841		203,423		402,851		102,104		170,066		101,033		242		1,148,560
Loss and LAE				92,428		138,015		291,605		29,687		130,393		0		(260)		681,868
Other expense				55,575		34,032		61,995		55,252		64,020		0		36,034		306,908
	Segment expense			148,003		172,047		353,600		84,939		194,413		-		35,774		988,776
		Segment pretax earnings (loss)	$	20,838	$	31,376	$	49,251	$	17,165	$	(24,347)	$	101,033	$	(35,532)	$	159,784

Three months ended June 30, 2012
Net earned premium			$	88,834	$	99,467	$	218,730	$	53,115	$	105,188	$	0	$	(3)	$	565,331
Other revenue				4,522		134		1,158		200		941		59,769		233		66,957
	Segment revenue			93,356		99,601		219,888		53,315		106,129		59,769		230		632,288
Loss and LAE				51,666		65,168		163,004		15,690		41,856		0		(559)		336,825
Other expense				30,045		18,676		32,164		27,403		36,612		0		16,244		161,144
	Segment expense			81,711		83,844		195,168		43,093		78,468		0		15,685		497,969
		Segment pretax earnings (loss)	$	11,645	$	15,757	$	24,720	$	10,222	$	27,661	$	59,769	$	(15,455)	$	134,319

Three months ended June 30, 2011
Net earned premium			$	78,921	$	102,424	$	202,117	$	50,039	$	90,717	$	0	$	33	$	524,251
Other revenue				4,787		48		1,178		455		894		53,126		113		60,601
	Segment revenue			83,708		102,472		203,295		50,494		91,611		53,126		146		584,852
Loss and LAE				44,944		71,752		146,747		14,648		56,221		0		(30)		334,282
Other expense				27,169		16,928		31,577		26,997		32,355		0		18,639		153,665
	Segment expense			72,113		88,680		178,324		41,645		88,576		-		18,609		487,947
		Segment pretax earnings (loss)	$	11,595	$	13,792	$	24,971	$	8,849	$	3,035	$	53,126	$	(18,463)	$	96,905

Catastrophe losses reduced the International segment's pretax earnings by $8.3 million and $72.3 million in the first six monthsof 2012 and 2011, respectively, and $4.7 million and $22.8 million in the second quarter of 2012 and 2011, respectively.