Reserve for Claims and Claim Expenses (Tables)

12 Months Ended

Dec. 31, 2016

Schedule of Liability for Unpaid Claims and Claim Expenses

The following table details the Company’s prior year development by segment of its liability for unpaid claims and claim expenses:




Year ended December 31,	2016			2015			2014
Property	$	(104,876	)	$	(93,786	)	$	(87,258	)
Casualty and Specialty	(58,140		)	(67,791		)	(50,403		)
Other	(1,110		)	(870		)	(6,137		)
Total favorable development of prior accident years net claims and claim expenses	$	(164,126	)	$	(162,447	)	$	(143,798	)

The reconciliation of the net incurred and paid claims development tables to the reserve for claims and claim expenses in the consolidated balance sheet is as follows:




At December 31, 2016
Net reserve for claims and claim expenses
Property	$	584,036
Casualty and Specialty	1,982,580
Other	2,114
Total net reserve for claims and claim expenses	2,568,730

Reinsurance recoverable
Property	$	43,738
Casualty and Specialty	212,546
Other	23,280
Total reinsurance recoverable	279,564
Total gross reserve for claims and claim expenses	$	2,848,294

The following table details the development of the Company’s liability for unpaid claims and claim expenses for its Property segment, allocated between large and small catastrophe net claims and claim expenses and attritional net claims and claim expenses, included in the other line item:




Year ended December 31,	2016			2015			2014
	(Favorable) adverse development			(Favorable) adverse development			(Favorable) adverse development
Catastrophe net claims and claim expenses
Large catastrophe events
Thailand Floods (2011)	$	(15,131	)	$	(18,823	)	$	(11,754	)
Tohoku Earthquake and Tsunami (2011)	(7,314		)	(5,313		)	(5,408		)
New Zealand Earthquake (2011)	1,987			22,754			(3,088		)
2011 International Events	(20,458		)	(1,382		)	(20,250		)
Storm Sandy (2012)	(10,849		)	(12,503		)	(24,232		)
April and May U.S. Tornadoes (2011)	(4,213		)	(10,190		)	(14,272		)
New Zealand Earthquake (2010)	6,904			1,095			24,692
Other	(5,310		)	(11,300		)	(23,947		)
Total large catastrophe events	(33,926		)	(34,280		)	(58,009		)
Small catastrophe events
U.S. PCS 13/14 Wind and Thunderstorm (2013)	(6,286		)	(1,882		)	(4,239		)
Tianjin Explosion (2015)	(5,686		)	—			—
U.S. PCS 15 Wind and Thunderstorm (2013)	(5,648		)	418			2,400
U.S. PCS 81 Wind and Thunderstorm (2015)	(5,098		)	—			—
U.S. PCS 70 and 73 Wind and Thunderstorm (2012)	(3,772		)	(1,220		)	13,362
U.S. PCS 24 Wind and Thunderstorm (2013)	(229		)	(809		)	(6,712		)
European Floods (2013)	(40		)	(2,466		)	(8,496		)
Other	(44,191		)	(52,046		)	(25,564		)
Total small catastrophe events	(70,950		)	(58,005		)	(29,249		)
Total catastrophe net claims and claim expenses	(104,876		)	(92,285		)	(87,258		)
Actuarial assumption changes	—			(1,501		)	—
Total net favorable development of prior accident years net claims and claim expenses	$	(104,876	)	$	(93,786	)	$	(87,258	)

The following table details the development of the Company’s liability for unpaid claims and claim expenses for its Other category:




Year ended December 31,	2016			2015			2014
	(Favorable) adverse development			(Favorable) adverse development			(Favorable) adverse development
Other	$	(1,110	)	$	(870	)	$	(6,137	)

The following table summarizes the Company’s claims and claim expense reserves by segment, allocated between case reserves, additional case reserves and IBNR:




At December 31, 2016	Case Reserves		Additional Case Reserves		IBNR		Total
Property	$	214,954	$	186,308	$	226,512	$	627,774
Casualty and Specialty	591,705		105,419		1,498,002		2,195,126
Other	6,935		—		18,459		25,394
Total	$	813,594	$	291,727	$	1,742,973	$	2,848,294

At December 31, 2015
Property	$	298,687	$	165,838	$	241,676	$	706,201
Casualty and Specialty	553,574		129,866		1,349,726		2,033,166
Other	2,071		—		25,607		27,678
Total	$	854,332	$	295,704	$	1,617,009	$	2,767,045

Activity in the liability for unpaid claims and claim expenses is summarized as follows:




Year ended December 31,	2016			2015			2014
Net reserves as of January 1	$	2,632,519		$	1,345,816		$	1,462,705
Net incurred related to:
Current year	694,957			610,685			341,745
Prior years	(164,126		)	(162,447		)	(143,798		)
Total net incurred	530,831			448,238			197,947
Net paid related to:
Current year	83,015			95,747			39,830
Prior years	506,279			425,565			241,286
Total net paid	589,294			521,312			281,116
Amounts acquired (1)	—			1,394,117			—
Foreign exchange	(5,326		)	(34,340		)	(33,720		)
Net reserves as of December 31	2,568,730			2,632,519			1,345,816
Reinsurance recoverable as of December 31	279,564			134,526			66,694
Gross reserves as of December 31	$	2,848,294		$	2,767,045		$	1,412,510

(1) Represents the fair value of Platinum's reserve for claims and claim expenses and reinsurance recoverable acquired at March 2, 2015.

The following table details the development of the Company’s liability for unpaid claims and claim expenses for its Casualty and Specialty segment:




Year ended December 31,	2016			2015			2014
	(Favorable) adverse development			(Favorable) adverse development			(Favorable) adverse development
Actuarial methods - actual reported claims less than expected claims	$	(52,601	)	$	(72,551	)	$	(50,403	)
Actuarial assumption changes	(5,539		)	4,760			—
Total favorable development of prior accident years net claims and claim expenses	$	(58,140	)	$	(67,791	)	$	(50,403	)

Short-duration Insurance Contracts, Claims Development

The following table details the Company’s consolidated incurred claims and claim expenses and cumulative paid claims and claim expenses as of December 31, 2016, net of reinsurance, as well as IBNR plus ACR included within the net incurred claims amounts.




	Incurred claims and claim expenses, net of reinsurance
	For the year ended December 31,																				At December 31, 2016
Accident Year	2007		2008		2009		2010		2011		2012		2013		2014		2015		2016		IBNR and ACR
	(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
2007	$	1,113,667	$	1,025,247	$	958,206	$	911,337	$	868,747	$	806,487	$	778,185	$	766,845	$	774,396	$	770,219	$	67,726
2008	—		1,469,251		1,429,241		1,408,748		1,390,282		1,317,055		1,294,396		1,272,298		1,262,048		1,247,506		48,658
2009	—		—		704,560		639,182		622,181		582,725		557,623		536,393		527,374		522,566		30,006
2010	—		—		—		988,403		946,271		898,572		867,523		864,328		854,924		863,129		79,809
2011	—		—		—		—		1,611,509		1,533,946		1,454,063		1,377,450		1,349,227		1,314,451		113,383
2012	—		—		—		—		—		862,333		767,534		705,316		679,446		651,764		132,561
2013	—		—		—		—		—		—		614,066		552,965		504,401		465,948		127,969
2014	—		—		—		—		—		—		—		657,958		613,360		600,956		155,602
2015	—		—		—		—		—		—		—		—		635,553		620,623		343,935
2016	—		—		—		—		—		—		—		—		—		675,378		542,083
Total																			$	7,732,540	$	1,641,732

	Cumulative paid claims and claim expenses, net of reinsurance
	For the year ended December 31,
Accident Year	2007		2008		2009		2010		2011		2012		2013		2014		2015		2016
	(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
2007	$	91,877	$	281,119	$	371,280	$	469,657	$	541,511	$	588,997	$	613,200	$	638,348	$	657,017	$	682,644
2008	—		275,968		591,482		797,242		937,678		1,013,041		1,060,160		1,090,977		1,118,434		1,140,094
2009	—		—		96,378		267,983		319,313		363,190		395,580		434,257		455,919		462,192
2010	—		—		—		126,401		309,807		425,914		495,847		549,898		620,545		709,672
2011	—		—		—		—		249,556		522,071		861,359		1,013,577		1,101,596		1,145,239
2012	—		—		—		—		—		165,581		265,612		356,102		415,911		459,269
2013	—		—		—		—		—		—		86,344		177,423		240,046		283,707
2014	—		—		—		—		—		—		—		110,863		199,632		268,806
2015	—		—		—		—		—		—		—		—		95,712		192,864
2016	—		—		—		—		—		—		—		—		—		79,422
Total																			$	5,423,909
Outstanding liabilities from accident year 2006 and prior, net of reinsurance																			226,695
Claims and claim expenses, net of reinsurance, from the Company's former Bermuda-based insurance operations																			2,114
Adjustment for unallocated claim expenses																			20,256
Unamortized fair value adjustments recorded in connection with the acquisition of Platinum																			11,034
Liability for claims and claim expenses, net of reinsurance																			$	2,568,730

The following table details the Company's cumulative number of reported claims for its excess of loss reinsurance contracts allocated by segment:




	At December 31, 2016
	Cumulative number of reported claims
Accident Year	Property	Casualty and Specialty
2007	908	1,388
2008	1,350	1,368
2009	742	1,082
2010	781	1,030
2011	1,178	1,356
2012	667	1,253
2013	622	1,187
2014	523	1,353
2015	555	988
2016	548	365

The following table details the Company’s Casualty and Specialty segment incurred claims and claim expenses and cumulative paid claims and claim expenses as of December 31, 2016, net of reinsurance, as well as IBNR plus ACR included within the net incurred claims amounts.




	Incurred claims and claim expenses, net of reinsurance
	For the year ended December 31,																				At December 31, 2016
Accident Year	2007		2008		2009		2010		2011		2012		2013		2014		2015		2016		IBNR and ACR
	(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
2007	$	725,801	$	716,019	$	707,231	$	664,514	$	634,627	$	593,259	$	572,017	$	567,053	$	575,730	$	570,836	$	67,329
2008	—		618,202		676,892		656,247		641,364		601,770		594,084		581,268		578,390		563,225		47,739
2009	—		—		485,953		476,058		477,829		444,594		423,610		401,671		393,315		388,207		29,595
2010	—		—		—		382,650		389,209		375,894		340,397		318,995		305,827		304,147		44,094
2011	—		—		—		—		381,046		379,986		350,622		320,628		313,105		307,083		65,301
2012	—		—		—		—		—		426,089		423,973		394,474		386,310		376,260		94,318
2013	—		—		—		—		—		—		390,524		360,284		333,772		316,751		112,090
2014	—		—		—		—		—		—		—		475,440		459,590		454,267		140,782
2015	—		—		—		—		—		—		—		—		410,884		428,030		281,187
2016	—		—		—		—		—		—		—		—		—		423,604		363,617
Total																			$	4,132,410	$	1,246,052

	Cumulative paid claims and claim expenses, net of reinsurance
	For the year ended December 31,
Accident Year	2007		2008		2009		2010		2011		2012		2013		2014		2015		2016
	(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
2007	$	46,347	$	130,181	$	198,768	$	281,659	$	350,908	$	394,670	$	415,667	$	440,613	$	458,363	$	482,751
2008	—		28,806		200,474		258,298		309,005		351,377		384,565		411,674		437,303		457,555
2009	—		—		40,313		168,583		206,034		242,351		269,147		303,399		324,096		329,461
2010	—		—		—		34,816		98,683		135,996		163,572		182,403		227,048		240,644
2011	—		—		—		—		47,906		112,960		144,995		174,609		205,595		223,419
2012	—		—		—		—		—		65,537		120,751		167,358		207,796		241,209
2013	—		—		—		—		—		—		37,794		85,987		125,003		157,963
2014	—		—		—		—		—		—		—		55,762		103,874		150,502
2015	—		—		—		—		—		—		—		—		33,539		84,691
2016	—		—		—		—		—		—		—		—		—		31,942
Total																			$	2,400,137
Outstanding liabilities from accident year 2006 and prior, net of reinsurance																			222,830
Adjustment for unallocated claim expenses																			17,862
Unamortized fair value adjustments recorded in connection with the acquisition of Platinum																			9,615
Liability for claims and claim expenses, net of reinsurance																			$	1,982,580

The following table details the Company’s Property segment incurred claims and claim expenses and cumulative paid claims and claim expenses as of December 31, 2016, net of reinsurance, as well as IBNR plus ACR included within the net incurred claims amounts.




	Incurred claims and claim expenses, net of reinsurance
	For the year ended December 31,																				At December 31, 2016
Accident Year	2007		2008		2009		2010		2011		2012		2013		2014		2015		2016		IBNR and ACR
	(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
2007	$	387,866	$	309,228	$	250,975	$	246,823	$	234,120	$	213,228	$	206,168	$	199,792	$	198,666	$	199,383	$	397
2008	—		851,049		752,349		752,501		748,918		715,285		700,312		691,030		683,658		684,281		919
2009	—		—		218,607		163,124		144,352		138,131		134,013		134,722		134,059		134,359		411
2010	—		—		—		605,753		557,062		522,678		527,126		545,333		549,097		558,982		35,715
2011	—		—		—		—		1,230,463		1,153,960		1,103,441		1,056,822		1,036,122		1,007,368		48,082
2012	—		—		—		—		—		436,244		343,561		310,842		293,136		275,504		38,243
2013	—		—		—		—		—		—		223,542		192,681		170,629		149,197		15,879
2014	—		—		—		—		—		—		—		182,518		153,770		146,689		14,820
2015	—		—		—		—		—		—		—		—		224,669		192,593		62,748
2016	—		—		—		—		—		—		—		—		—		251,774		178,466
Total																			$	3,600,130	$	395,680

	Cumulative paid claims and claim expenses, net of reinsurance
	For the year ended December 31,
Accident Year	2007		2008		2009		2010		2011		2012		2013		2014		2015		2016
	(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
2007	$	45,530	$	150,938	$	172,512	$	187,998	$	190,603	$	194,327	$	197,533	$	197,735	$	198,654	$	199,893
2008	—		247,162		391,008		538,944		628,673		661,664		675,595		679,303		681,131		682,539
2009	—		—		56,065		99,400		113,279		120,839		126,433		130,858		131,823		132,731
2010	—		—		—		91,585		211,124		289,918		332,275		367,495		393,497		469,028
2011	—		—		—		—		201,650		409,111		716,364		838,968		896,001		921,820
2012	—		—		—		—		—		100,044		144,861		188,744		208,115		218,060
2013	—		—		—		—		—		—		48,550		91,436		115,043		125,744
2014	—		—		—		—		—		—		—		55,101		95,758		118,304
2015	—		—		—		—		—		—		—		—		62,173		108,173
2016	—		—		—		—		—		—		—		—		—		47,480
Total																			$	3,023,772
Outstanding liabilities from accident year 2006 and prior, net of reinsurance																			3,865
Adjustment for unallocated claim expenses																			2,394
Unamortized fair value adjustments recorded in connection with the acquisition of Platinum																			1,419
Liability for claims and claim expenses, net of reinsurance																			$	584,036

Short-duration Insurance Contracts, Schedule of Historical Claims Duration

The following is unaudited supplementary information about average historical claims duration by segment:




	Average annual percentage payout of incurred claims by age, net of reinsurance (number of years)
At December 31, 2016	1		2		3		4		5		6		7		8		9		10
Property	26.5	%	23.7	%	20.9	%	10.2	%	5.0	%	2.9	%	5.3	%	0.3	%	0.3	%	0.6	%
Casualty and Specialty	10.2	%	19.3	%	11.1	%	10.6	%	8.8	%	8.1	%	4.5	%	3.7	%	3.4	%	4.3	%