Reinsurance

12 Months Ended

Dec. 31, 2020

(a) Reinsurance Recoverable on Paid and Unpaid Losses

The Company uses retrocessional agreements to reduce its exposure to risk of loss on reinsurance assumed. These agreements provide for recovery from retrocessionaires of a portion of losses and loss expenses. The Company remains liable to its cedants to the extent that the retrocessionaires do not meet their obligations under these agreements, and therefore the Company evaluates the financial condition of its reinsurers and monitors concentration of credit risk on an ongoing basis. The Company actively manages its reinsurance exposures by generally selecting retrocessionaires that have a credit rating of A- or higher. In certain cases where an otherwise suitable retrocessionaire has a credit rating lower than A-, the Company generally requires the posting of collateral, including escrow funds and letters of credit, as a condition to its entering into a retrocession agreement.

The Company adopted updated accounting guidance on the recognition of credit losses effective January 1, 2020. In assessing an allowance for reinsurance recoverable balances, the Company considers historical information, financial strength and credit ratings of reinsurers, collateralization amounts and the remaining expected life of reinsurance recoverable balances to determine the appropriateness of the allowance. Historically, the Company has not experienced material credit losses from retrocessional agreements. In assessing future default for reinsurance recoverable balances, the Company evaluates the valuation allowance under the probability of default and loss given default method and utilizes counterparty credit ratings from major rating agencies, as well as assessing the current market conditions and reasonable and supportable forecasts for the likelihood of default. As a result of the adoption and at December 31, 2020, the Company recorded an allowance for credit losses of $3 million on its reinsurance recoverable balance. This compared to no allowance for its reinsurance recoverable balance at December 31, 2019.

(b) Ceded Reinsurance

Net premiums written, net premiums earned and losses and loss expenses are reported net of reinsurance in the Company’s Consolidated Statements of Operations. Assumed, ceded and net amounts for the years ended December 31, 2020, 2019 and 2018 were as follows (in thousands of U.S. dollars):


	Premiums Written		Premiums Earned		Losses and Loss Expenses
2020
Non-life	$	5,376,703	$	5,571,201	$	4,358,975
Life and Health	1,499,222		1,505,819		1,344,117
Assumed	$	6,875,925	$	7,077,020	$	5,703,092

Non-life	$	550,784	$	516,672	$	342,271
Life and Health	24,283		23,522		25,921
Ceded	$	575,067	$	540,194	$	368,192

Non-life	$	4,825,919	$	5,054,529	$	4,016,704
Life and Health	1,474,939		1,482,297		1,318,196
Net	$	6,300,858	$	6,536,826	$	5,334,900


	Premiums Written		Premiums Earned		Losses and Loss Expenses
2019
Non-life (1)	$	5,792,542	$	5,433,357	$	3,879,242
Life and Health	1,492,778		1,489,721		1,277,684
Assumed	$	7,285,320	$	6,923,078	$	5,156,926

Non-life (1)	$	353,735	$	375,301	$	219,102
Life and Health	22,527		22,559		14,668
Ceded	$	376,262	$	397,860	$	233,770

Non-life (1)	$	5,438,807	$	5,058,056	$	3,660,140
Life and Health	1,470,251		1,467,162		1,263,016
Net	$	6,909,058	$	6,525,218	$	4,923,156


	Premiums Written		Premiums Earned		Losses and Loss Expenses
2018
Non-life	$	5,064,780	$	4,751,958	$	3,566,201
Life and Health	1,235,149		1,235,973		1,035,363
Assumed	$	6,299,929	$	5,987,931	$	4,601,564

Non-life	$	472,498	$	450,096	$	397,554
Life and Health	24,067		24,025		10,755
Ceded	$	496,565	$	474,121	$	408,309

Non-life	$	4,592,282	$	4,301,862	$	3,168,647
Life and Health	1,211,082		1,211,948		1,024,608
Net	$	5,803,364	$	5,513,810	$	4,193,255

(1)Non-life Losses and loss expenses include amounts allocated to Corporate and Other as disclosed in Note 18.