Segment Information

12 Months Ended

Dec. 31, 2016

Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract]

Segment Reporting Disclosure [Text Block]

20. Segment Information

Effective July 1, 2016, the Company’s business units have been consolidated into three worldwide business segments: Property and Casualty (P&C), Specialty and Life and Health. As a result, the Company monitors the performance of its operations in these three segments. The business in the P&C and Specialty segments is collectively referred to as Non-life business. P&C, Specialty and Life and Health each separately represent markets that are reasonably homogeneous in terms of client types, buying patterns, underlying risk patterns and approach to risk management.

The P&C segment provides holistic access to property and casualty risks, including property catastrophe and facultative through five regions: North America; Europe; Asia; Latin America; and Middle East, Africa and Russia. The Specialty segment is a centralized specialty unit offering specialty lines treaty and facultative solutions. The Life and Health segment operates as a worldwide specialist unit, taking an integrated approach to client needs.

Management measures results for the P&C and Specialty segments on the basis of the loss ratio, acquisition ratio, technical ratio, other expense ratio and combined ratio (all defined below). Management measures results for the Life and Health segment on the basis of the allocated underwriting result, which includes revenues from net premiums earned, other income or loss and allocated net investment income for Life and Health, and expenses from life policy benefits, acquisition costs and other expenses.

The segment results for the years ended December 31, 2016, 2015 and 2014 are presented below (in millions of U.S. dollars, except ratios). The results for the years ended December 31, 2015 and 2014 have been recast to conform to the current segment presentation.

Segment Information

For the year ended December 31, 2016

	P&C segment			Specialty segment			Total Non-life			Life and Health segment			Corporate and Other			Total
Gross premiums written	$	2,269		$	1,920		$	4,189		$	1,168		$	—		$	5,357
Net premiums written	$	2,061		$	1,776		$	3,837		$	1,117		$	—		$	4,954
Decrease (increase) in unearned premiums	25			(9		)	16			—			—			16
Net premiums earned	$	2,086		$	1,767		$	3,853		$	1,117		$	—		$	4,970
Losses and loss expenses	(1,248		)	(1,073		)	(2,321		)	(927		)	—			(3,248		)
Acquisition costs	(556		)	(500		)	(1,056		)	(131		)	—			(1,187		)
Technical result	$	282		$	194		$	476		$	59		$	—		$	535
Other income							2			10			3			15
Other expenses							(229		)	(66		)	(177		)	(472		)
Underwriting result							$	249		$	3		n/a			$	78
Net investment income										58			353			411
Allocated underwriting result (1)										$	61		n/a			n/a
Net realized and unrealized investment gains													26			26
Interest expense													(49		)	(49		)
Loss on redemption of senior notes													(22		)	(22		)
Amortization of intangible assets													(26		)	(26		)
Net foreign exchange gains													78			78
Income tax expense													(26		)	(26		)
Interest in losses of equity method investments													(23		)	(23		)
Net income													n/a			$	447
Loss ratio (2)	59.8		%	60.8		%	60.3		%
Acquisition ratio (3)	26.7			28.3			27.4
Technical ratio (4)	86.5		%	89.1		%	87.7		%
Other expense ratio (5)							5.9
Combined ratio (6)							93.6		%

(1) Allocated underwriting result is defined as net premiums earned, other income or loss and allocated net investment income less life policy benefits, acquisition costs and other expenses.

(2) Loss ratio is obtained by dividing losses and loss expenses by net premiums earned.

(3) Acquisition ratio is obtained by dividing acquisition costs by net premiums earned.

(4) Technical ratio is defined as the sum of the loss ratio and the acquisition ratio.

(5) Other expense ratio is obtained by dividing other expenses by net premiums earned.

(6) Combined ratio is defined as the sum of the technical ratio and the other expense ratio.

n/a: Not applicable

Segment Information

For the year ended December 31, 2015

	P&C segment			Specialty segment			Total Non-life			Life and Health segment			Corporate and Other			Total
Gross premiums written	$	2,371		$	1,906		$	4,277		$	1,271		$	—		$	5,548
Net premiums written	$	2,236		$	1,786		$	4,022		$	1,208		$	—		$	5,230
Decrease in unearned premiums	4			34			38			1			—			39
Net premiums earned	$	2,240		$	1,820		$	4,060		$	1,209		$	—		$	5,269
Losses and loss expenses	(1,129		)	(1,064		)	(2,193		)	(964		)	—			(3,157		)
Acquisition costs	(570		)	(494		)	(1,064		)	(153		)	—			(1,217		)
Technical result	$	541		$	262		$	803		$	92		$	—		$	895
Other income							—			6			3			9
Other expenses							(219		)	(63		)	(509		)	(791		)
Underwriting result							$	584		$	35		n/a			$	113
Net investment income										59			391			450
Allocated underwriting result										$	94		n/a			n/a
Net realized and unrealized investment losses													(297		)	(297		)
Interest expense													(49		)	(49		)
Amortization of intangible assets													(27		)	(27		)
Net foreign exchange losses													(9		)	(9		)
Income tax expense													(80		)	(80		)
Interest in earnings of equity method investments													6			6
Net income													n/a			$	107
Loss ratio	50.4		%	58.5		%	54.0		%
Acquisition ratio	25.4			27.1			26.2
Technical ratio	75.8		%	85.6		%	80.2		%
Other expense ratio							5.4
Combined ratio							85.6		%

Segment Information

For the year ended December 31, 2014

	P&C segment			Specialty segment			Total Non-life			Life and Health segment			Corporate and Other			Total
Gross premiums written	$	2,539		$	2,128		$	4,667		$	1,265		$	—		$	5,932
Net premiums written	$	2,467		$	2,033		$	4,500		$	1,220		$	—		$	5,720
(Increase) decrease in unearned premiums	(66		)	(47		)	$	(113	)	2			—			$	(111	)
Net premiums earned	$	2,401		$	1,986		$	4,387		$	1,222		$	—		$	5,609
Losses and loss expenses	(1,136		)	(1,327		)	(2,463		)	(1,000		)	—			(3,463		)
Acquisition costs	(599		)	(466		)	(1,065		)	(149		)	—			(1,214		)
Technical result	$	666		$	193		$	859		$	73		$	—		$	932
Other income							3			8			5			16
Other expenses							(252		)	(68		)	(130		)	(450		)
Underwriting result							$	610		$	13		n/a			$	498
Net investment income										60			420			480
Allocated underwriting result										$	73		n/a			n/a
Net realized and unrealized investment gains													372			372
Interest expense													(49		)	(49		)
Amortization of intangible assets													(27		)	(27		)
Net foreign exchange gains													18			18
Income tax expense													(239		)	(239		)
Interest in earnings of equity method investments													15			15
Net income													n/a			$	1,068
Loss ratio	47.3		%	66.8		%	56.1		%
Acquisition ratio	24.9			23.5			24.3
Technical ratio	72.2		%	90.3		%	80.4		%
Other expense ratio							5.8
Combined ratio							86.2		%

The following table provides the geographic distribution of gross premiums written based on the location of the underlying risk for the years ended December 31, 2016, 2015 and 2014:

	2016		2015		2014
Asia, Australia and New Zealand	12	%	12	%	11	%
Europe	36		37		40
Latin America, Caribbean and Africa	8		10		10
North America	44		41		39
Total	100	%	100	%	100	%

The Company produces its business both through brokers and through direct relationships with insurance company clients. None of the Company’s cedants individually accounted for more than 4%, 3% and 4% of total gross premiums written during the years ended December 31, 2016, 2015 and 2014, respectively.

The Company has two brokers that individually accounted for 10% or more of its gross premiums written during the years ended December 31, 2016, 2015 and 2014. The brokers accounted for 22%, 19% and 20% and 22%, 22% and 20% of gross premiums written for the years ended December 31, 2016, 2015 and 2014, respectively.

The following table summarizes the percentage of gross premiums written through these two brokers by segment for the years ended December 31, 2016, 2015 and 2014:

	2016		2015		2014
P&C	57	%	54	%	53	%
Specialty	46		42		40
Life and Health	16		16		12