Taxation (Tables)

12 Months Ended

Dec. 31, 2014

Income tax expense for the years ended December 31, 2014, 2013 and 2012 was as follows (in thousands of U.S. dollars):



	2014			2013			2012
Current income tax expense
U.S.	$	51,615		$	55,993		$	29,196
Non U.S.	184,367			73,599			115,669
Total current income tax expense	$	235,982		$	129,592		$	144,865
Deferred income tax expense (benefit)
U.S.	$	20,410		$	(13,693	)	$	48,740
Non U.S.	(17,636		)	(70,886		)	6,717
Total deferred income tax expense (benefit)	$	2,774		$	(84,579	)	$	55,457
Unrecognized tax expense (benefit)
U.S.	$	—		$	(335	)	$	(623	)
Non U.S.	750			3,738			4,585
Total unrecognized tax expense	$	750		$	3,403		$	3,962
Total income tax expense
U.S.	$	72,025		$	41,965		$	77,313
Non U.S.	167,481			6,451			126,971
Total income tax expense	$	239,506		$	48,416		$	204,284

Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block]

Income before taxes attributable to the Company’s domestic and foreign operations and a reconciliation of the actual income tax rate to the amount computed by applying the effective tax rate of 0% under Bermuda (the Company’s domicile) law to income before taxes was as follows for the years ended December 31, 2014, 2013 and 2012 (in thousands of U.S. dollars):



	2014		2013		2012
Domestic (Bermuda)	$	686,538	$	611,900	$	661,648
Foreign	621,081		109,958		677,150
Income before taxes	$	1,307,619	$	721,858	$	1,338,798

Reconciliation of effective tax rate



Reconciliation of effective tax rate (% of income before taxes)
Expected tax rate	0.0	%	0.0	%	0.0	%
Foreign taxes at local expected tax rates	15.8		5.1		14.6
Impact of foreign exchange gains (losses)	2.2		(1.1	)	(0.4	)
Unrecognized tax benefit	0.1		0.5		0.3
Tax-exempt income and expenses not deductible	(2.2	)	(0.9	)	(0.3	)
Impact of enacted changes in tax laws	—		1.8		0.7
Foreign branch tax	1.4		(1.4	)	(0.7	)
Ceding commissions	1.8		(0.4	)	0.7
Valuation allowance	(0.6	)	1.3		1.2
Other	(0.2	)	1.8		(0.8	)
Actual tax rate	18.3	%	6.7	%	15.3	%

Significant components of net deferred tax assets and liabilities

Significant components of the net deferred tax assets and liabilities at December 31, 2014 and 2013 were as follows (in thousands of U.S. dollars):



	2014			2013
Deferred tax assets
Discounting of loss reserves and adjustment to life policy reserves	$	77,117		$	78,999
Foreign tax credit carryforwards	57,186			42,620
Tax loss carryforwards	35,384			23,940
Unearned premiums	23,230			23,022
Other deferred tax assets	32,431			33,648
	225,348			202,229
Valuation allowance	(68,115		)	(46,111		)
Deferred tax assets	157,233			156,118
Deferred tax liabilities
Deferred acquisition costs	54,718			52,165
Goodwill and other intangibles	93,416			102,619
Equalization reserves	77,383			128,132
Unrealized appreciation and timing differences on investments	85,873			72,769
Other deferred tax liabilities	51,385			23,866
Deferred tax liabilities	362,775			379,551
Net deferred tax liabilities	$	(205,542	)	$	(223,433	)

Schedule Of Net Tax Assets And Liabilities Table [Text Block]

The components of net tax assets and liabilities at December 31, 2014 and 2013 were as follows (in thousands of U.S. dollars):



	2014			2013
Net tax assets	$	6,876		$	14,133
Net tax liabilities	(240,989		)	(284,442		)
Net tax liabilities	$	(234,113	)	$	(270,309	)



	2014			2013
Net current tax liabilities	$	(9,739	)	$	(26,308	)
Net deferred tax liabilities	(205,542		)	(223,433		)
Net unrecognized tax benefit	(18,832		)	(20,568		)
Net tax liabilities	$	(234,113	)	$	(270,309	)

Total amount of unrecognized tax benefits

The total amount of unrecognized tax benefits for the years ended December 31, 2014, 2013 and 2012 was as follows (in thousands of U.S. dollars):



	January 1, 2014		Changes in tax positions taken during a prior period		Tax positions taken during the current period		Change as a result of a lapse of the statute of limitations			Impact of the change in foreign currency exchange rates			December 31, 2014
Unrecognized tax benefits that, if recognized, would impact the effective tax rate	$	19,353	$	1,338	$	5,142	$	(5,197	)	$	(2,370	)	$	18,266
Interest and penalties recognized on the above	1,215		259		—		(792		)	(116		)	566
Total unrecognized tax benefits, including interest and penalties	$	20,568	$	1,597	$	5,142	$	(5,989	)	$	(2,486	)	$	18,832



	January 1, 2013		Changes in tax positions taken during a prior period			Tax positions taken during the current period		Change as a result of a lapse of the statute of limitations			Impact of the change in foreign currency exchange rates		December 31, 2013
Unrecognized tax benefits that, if recognized, would impact the effective tax rate	$	15,784	$	(5,038	)	$	10,164	$	(2,102	)	$	545	$	19,353
Interest and penalties recognized on the above	800		507			51		(179		)	36		1,215
Total unrecognized tax benefits, including interest and penalties	$	16,584	$	(4,531	)	$	10,215	$	(2,281	)	$	581	$	20,568



	January 1, 2012		Changes in tax positions taken during a prior period		Tax positions taken during the current period		Change as a result of a lapse of the statute of limitations			Impact of the change in foreign currency exchange rates		December 31, 2012
Unrecognized tax benefits that, if recognized, would impact the effective tax rate	$	11,879	$	1,571	$	3,080	$	(1,057	)	$	311	$	15,784
Interest and penalties recognized on the above	411		504		8		(144		)	21		800
Total unrecognized tax benefits, including interest and penalties	$	12,290	$	2,075	$	3,088	$	(1,201	)	$	332	$	16,584

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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