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Cash and Investments (Tables)
12 Months Ended
Dec. 31, 2024
Cash and Investments  
Schedule of cash and investments and portfolio investments, net of derivative obligations

    

December 31, 

    

December 31, 

2024

2023

Holding company

 

  

 

  

Cash and cash equivalents(1)

 

663.2

 

406.8

Short term investments

 

51.6

 

192.9

Bonds

 

444.8

 

344.3

Preferred stocks

 

20.2

 

12.2

Common stocks(2)

 

92.5

 

103.5

Derivatives (note 7)

 

1,036.8

 

524.2

 

2,309.1

 

1,583.9

Assets pledged for derivative obligations:

 

 

Cash equivalents

101.1

2.5

Short term investments

 

 

127.8

Bonds

 

92.5

 

67.4

193.6

197.7

 

 

Holding company cash and investments as presented on the consolidated balance sheet

 

2,502.7

 

1,781.6

Derivative obligations (note 7)

 

(0.6)

 

(32.5)

 

2,502.1

 

1,749.1

Portfolio investments

 

 

Cash and cash equivalents(1)

 

6,662.1

 

5,157.2

Short term investments

 

958.4

 

2,008.4

Bonds

 

37,390.3

 

36,850.8

Preferred stocks

 

2,365.0

 

2,447.4

Common stocks(2)

 

7,464.2

 

6,903.4

Investments in associates (note 6)

 

7,153.3

 

6,607.6

Derivatives (note 7)

 

538.0

 

448.3

Other invested assets(3)

 

621.7

 

577.0

 

63,153.0

 

61,000.1

Assets pledged for derivative obligations:

Bonds

 

150.8

 

139.3

 

 

Fairfax India cash, portfolio investments and associates:

 

 

Cash and cash equivalents(1)

 

86.2

 

197.2

Bonds

157.1

39.2

Common stocks

 

321.0

 

616.6

Investments in associates (note 6)

 

1,352.3

 

1,429.7

 

1,916.6

 

2,282.7

 

 

Portfolio investments as presented on the consolidated balance sheet

65,220.4

63,422.1

Derivative obligations (note 7)

 

(356.3)

 

(412.4)

 

64,864.1

 

63,009.7

Total cash and investments, net of derivative obligations

67,366.2

 

64,758.8

(1)Includes aggregate restricted cash and cash equivalents at December 31, 2024 of $1,400.1 (December 31, 2023 - $642.3). See note 25.
(2)Includes aggregate investments in limited partnerships with a carrying value at December 31, 2024 of $2,282.3 (December 31, 2023 – $2,171.8).
(3)Comprised primarily of investment property.
Schedule of pledged assets, by nature of pledge requirement

    

December 31, 

    

December 31, 

2024

2023

Regulatory deposits

 

6,714.4

 

6,701.0

Security for reinsurance and other

 

1,809.5

 

1,854.9

 

8,523.9

 

8,555.9

Schedule of fixed income maturity

December 31, 2024

December 31, 2023

 

Amortized

Fair

Amortized

Fair

 

cost(1)

value(1)

cost(1)

value(1)

Due in 1 year or less(2)

    

9,324.8

    

9,117.2

7,780.5

    

7,545.6

Due after 1 year through 3 years(2)

 

8,110.9

 

7,975.6

9,352.1

 

9,420.5

Due after 3 years through 5 years(2)

6,939.6

7,004.5

5,738.7

5,861.1

Due after 5 years through 10 years(3)

 

12,309.6

 

12,273.6

13,645.1

 

14,047.3

Due after 10 years(4)

 

2,036.2

 

1,864.6

577.9

 

566.5

 

38,721.1

 

38,235.5

37,094.3

 

37,441.0

Effective interest rate(5)

 

  

 

5.2

%

  

 

5.3

%

(1)Includes bonds held by the holding company and Fairfax India.
(2)Includes the company’s investments in first mortgage loans at December 31, 2024 of $4,777.8 (December 31, 2023 - $4,685.4) secured by real estate predominantly in the U.S., Europe and Canada.
(3)Includes U.S. treasury bonds at December 31, 2024 of $10,222.4 (December 31,2023 – $11,868.0) with maturities between 5 to 7 years.
(4)Includes U.S. treasury bonds at December 31, 2024 of $1,204.7 (December 31, 2023 - nil) with maturities between 28 to 30 years.
(5)The effective interest rate is the rate that discounts estimated future cash payments or receipts through the expected life of the fixed income investment to its gross carrying amount at initial recognition. The effective interest rate does not reflect changes in market interest rates that affect the fair value of the fixed income investment over time.
Schedule of fair value hierarchy of assets and liabilities

December 31, 2024

December 31, 2023

 

    

    

Significant

    

    

    

    

Significant

    

    

 

other

Significant

other

Significant

 

Quoted

observable

unobservable

Total fair

Quoted

observable

unobservable

Total fair

 

prices

inputs

inputs

value asset

prices

inputs

inputs

value asset

 

(Level 1)

(Level 2)

(Level 3)

(liability)

(Level 1)

(Level 2)

(Level 3)

(liability)

 

Cash and cash equivalents(1)

7,512.6

7,512.6

5,763.7

5,763.7

Short term investments:

  

  

  

  

  

  

  

Canadian government and provincials

98.5

98.5

553.3

553.3

U.S. treasury

217.8

217.8

794.1

794.1

Other government

55.7

171.0

226.7

31.3

339.0

370.3

Corporate and other

467.0

467.0

611.4

611.4

372.0

638.0

1,010.0

1,378.7

950.4

2,329.1

Bonds:

  

  

  

  

  

  

  

Canadian government and provincials

2,741.0

2,741.0

2,715.1

2,715.1

U.S. treasury

15,863.9

15,863.9

16,273.5

16,273.5

U.S. states and municipalities

179.6

179.6

184.5

184.5

Other government

6,087.4

45.9

6,133.3

4,903.0

39.3

4,942.3

Corporate and other(2)

7,601.0

5,716.7

13,317.7

7,567.9

5,757.7

13,325.6

32,472.9

5,762.6

38,235.5

31,644.0

5,797.0

37,441.0

Preferred stocks:

  

  

  

  

  

  

  

Canadian

16.3

19.2

35.5

15.5

3.5

8.8

27.8

U.S.

398.9

398.9

343.3

343.3

Other(3)

12.3

1,936.7

1.8

1,950.8

12.0

286.6

1,789.9

2,088.5

28.6

1,936.7

419.9

2,385.2

27.5

290.1

2,142.0

2,459.6

Common stocks:

  

  

  

  

  

  

  

Canadian

1,264.5

175.4

332.4

1,772.3

838.3

216.0

288.2

1,342.5

U.S.

902.4

34.3

1,396.0

2,332.7

988.0

27.4

1,258.7

2,274.1

Other

1,757.0

575.7

1,440.0

3,772.7

2,023.4

501.9

1,481.6

4,006.9

3,923.9

785.4

3,168.4

7,877.7

3,849.7

745.3

3,028.5

7,623.5

Derivatives and other invested assets

1,354.2

842.3

2,196.5

869.5

680.0

1,549.5

Derivative obligations (note 7)

(222.7)

(134.2)

(356.9)

(257.4)

(187.5)

(444.9)

Holding company cash and investments and portfolio investments measured at fair value

11,837.1

36,964.5

10,059.0

58,860.6

11,019.6

34,241.9

11,460.0

56,721.5

20.1

%

62.8

%

17.1

%

100.0

%

19.4

%

60.4

%

20.2

%

100.0

%

Investments in associates (note 6)(4)

4,420.5

679.5

5,643.8

10,743.8

3,592.3

83.2

6,532.3

10,207.8

(1)Includes restricted cash and cash equivalents of $1,400.1 at December 31, 2024 (December 31, 2023 – $642.3). Aggregate restricted cash and cash equivalents at December 31, 2024 included cash of $835.0 held at a depository in connection with the company’s investments in Blizzard Vacatia that closed on January 1, 2025 as described earlier. See also note 6 and note 25.
(2)Included in Level 3 are the company’s investments in first mortgage loans at December 31, 2024 of $4,777.8 (December 31, 2023 – $4,685.4) secured by real estate predominantly in the U.S., Europe and Canada.
(3)Primarily comprised of the company’s investment in compulsory convertible preferred shares of Go Digit Infoworks Services Limited (“Digit”). The company also holds a 49.0% equity interest in Digit as described in note 6.
(4)The fair value of investments in associates is presented separately as such investments are measured using the equity method of accounting.
Summary of changes in Level 3 financial assets measured at fair value on a recurring basis

    

2024

Private

    

Private

    

    

    

    

Derivatives

    

placement

company

Limited

Private

and other

debt

preferred

partnerships

equity

Common

invested

securities

shares

and other(1)

funds(1)

shares

assets

Total

Balance - January 1

5,797.0

 

2,142.0

 

1,998.2

 

72.8

 

957.5

 

492.5

 

11,460.0

Net realized and unrealized gains included in the consolidated statement of earnings

29.4

57.8

125.1

9.0

80.4

178.8

480.5

Purchases (2)

1,306.3

12.7

203.6

160.6

94.0

1,777.2

Sales and distributions (2)

 

(1,280.3)

 

(1.4)

 

(203.5)

 

(8.6)

 

(191.7)

 

(43.0)

 

(1,728.5)

Transfer out of category (3)

 

(31.8)

 

(1,784.3)

 

 

 

 

 

(1,816.1)

Unrealized foreign currency translation losses on foreign subsidiaries included in other comprehensive income (loss)

 

(58.0)

 

(6.9)

 

(18.6)

 

(2.3)

 

(14.1)

 

(14.2)

 

(114.1)

Balance - December 31

 

5,762.6

 

419.9

 

2,104.8

 

70.9

 

992.7

 

708.1

 

10,059.0

    

2023

    

Private

    

Private

    

    

    

    

Derivatives

    

placement

company

Limited

Private

and other

debt

preferred

partnerships

equity

Common

invested

securities

shares

and other(1)

funds(1)

shares

assets

Total

Balance - January 1

3,465.3

 

2,047.1

 

1,824.2

 

97.5

 

629.9

 

680.3

 

8,744.3

Net realized and unrealized gains (losses) included in the consolidated statement of earnings

63.7

(2.4)

(69.7)

(7.6)

12.3

(135.4)

(139.1)

Purchases(2)(4)

3,451.7

134.5

384.2

289.7

137.7

4,397.8

Acquisitions of insurance subsidiaries (note 21)

109.6

0.9

34.9

32.7

178.1

Sales and distributions(2)

 

(1,262.5)

 

(2.9)

 

(146.1)

 

(19.7)

 

(10.2)

 

(214.2)

 

(1,655.6)

Transfer out of category

 

 

(36.7)

 

 

 

(3.0)

 

 

(39.7)

Unrealized foreign currency translation gains (losses) on foreign subsidiaries included in other comprehensive income (loss)

 

12.5

 

2.4

 

5.6

 

1.7

 

3.9

 

(8.6)

 

17.5

Deconsolidation of non-insurance subsidiary

(43.3)

(43.3)

Balance - December 31

 

5,797.0

 

2,142.0

 

1,998.2

 

72.8

 

957.5

 

492.5

 

11,460.0

(1)Included in common stocks in the fair value hierarchy table presented on the previous page and in holding company cash and investments or common stocks on the consolidated balance sheets.
(2)Private placement debt securities include net purchases of first mortgage loans of $103.5 (2023 – $2,261.5).
(3)During 2024 the company’s investment in Digit compulsory convertible preferred shares was transferred from Level 3 to Level 2 following the completion of Digit Insurance’s initial public offering as described above.
(4)Private placement debt securities include the Amynta Group promissory note as described in note 21.
Summary of valuation techniques and unobservable inputs used to estimate fair value of assets

    

    

    

    

    

Effect on fair

value if input

Carrying

Input range used

value is

Asset class

value

Valuation technique

Significant unobservable input

Low

High

increased(a)

Bonds(b):

Private placement debt securities(1)

 

781.8

 

Discounted cash flow

 

Credit spread

 

0.8

%

7.3

%

Decrease

Mortgage loans(2)

 

4,777.8

 

Market approach

 

Recent transaction price

 

N/A

N/A

Increase

 

 

Discounted cash flow

 

Credit spread

3.0

%

10.4

%

Decrease

Other

203.0

Various

Various

N/A

N/A

N/A

5,762.6

Preferred stocks(c):

Private placement preferred shares

 

338.5

 

Discounted cash flow

 

Credit spread

 

3.6

%

4.3

%

Decrease

Other

81.4

Various

Various

N/A

N/A

N/A

419.9

Common stocks(d):

 

 

 

 

 

 

Limited partnerships and other(3)

2,104.8

Net asset value

Net asset value

N/A

N/A

Increase

Private equity funds(3)

463.1

Net asset value

Net asset value

N/A

N/A

Increase

Other

 

600.5

 

Various

 

Various

 

N/A

 

N/A

 

N/A

3,168.4

 

Derivatives and other invested assets(e):

Investment property(4)

307.0

Income capitalization

Terminal capitalization rate

6.3

%

9.0

%

Decrease

Discount rate

8.0

%

10.3

%

Decrease

Market rent growth rate

2.5

%

3.0

%

Increase

87.0

Sales comparison

Price per acre (Cdn$ thousands)

40.5

183.6

Increase

Other

314.1

Various

Various

N/A

N/A

N/A

708.1

Total

10,059.0

(a)Decreasing the input value would have the opposite effect on the estimated fair value.
(b)Included in holding company cash and investments or bonds on the consolidated balance sheet.
(c)Included in holding company cash and investments or preferred stocks on the consolidated balance sheet.
(d)Included in holding company cash and investments or common stocks on the consolidated balance sheet.
(e)Included in holding company cash and investments or derivatives and other invested assets, net of derivative obligations, on the consolidated balance sheet.
(1)At December 31, 2024 these private placement debt securities were valued using industry accepted discounted cash flow models that incorporated unobservable credit spreads of the issuers, and consisted of 11 investments, the largest being $125.6 (construction and home building) (December 31, 2023 - 10 investments, the largest being $148.9 (software and services)). By increasing (decreasing) the credit spreads applied at December 31, 2024 by 100 basis points, the fair value of this asset class would collectively decrease by $24.7 (increase by $26.1).
(2)At December 31, 2024 these mortgage loans consisted of 93 investments, the largest being $235.0 (December 31, 2023 – 102 investments, the largest being $235.0). By increasing (decreasing) the credit spreads applied at December 31, 2024 by 100 basis points, the fair value of this asset class would collectively decrease by $42.6 (increase by $25.2).
(3)Limited partnerships and other, and certain private equity funds, are investment funds managed by third party fund managers and general partners that invest in a diverse range of industries and geographies. These investment funds were valued primarily using net asset value statements provided by those third party fund managers and general partners. The fair values in those statements are determined using quoted prices of the underlying assets, and to a lesser extent, observable inputs where available and unobservable inputs, in conjunction with industry accepted valuation models, where required. Typically investment funds, when they otherwise meet the criteria to be classified as Level 2, are instead classified as Level 3 if they require at least three months’ notice to liquidate or redeem. At December 31, 2024 limited partnerships and other consisted of 44 investments, the three largest being $320.1 (industrials), $288.4 (oil and gas extraction) and $265.6 (industrials) (December 31, 2023 - 42 investments, the three largest being $315.0 (industrials), $242.5 (primarily industrials and consumer discretionary) and $235.3 (oil and gas extraction )). By increasing (decreasing) net asset values at December 31, 2024 by 10%, the fair value of limited partnerships and other would collectively increase (decrease) by $210.5.
(4)These investment property were primarily valued by third party appraisers using an industry accepted income capitalization approach that incorporated unobservable capitalization rates, discount rates and market rent growth rates. Certain investment property were valued using an industry accepted direct sales comparison approach that incorporated recent non-public sale prices per acre for comparable properties in similar locations.
Schedule of investment income

    

2024

2023

Interest income:

 

  

 

  

Cash and short term investments

 

359.8

 

279.4

Bonds

 

2,055.3

 

1,624.9

Derivatives and other invested assets

 

(68.5)

 

(63.2)

 

2,346.6

 

1,841.1

Dividends:

 

 

Preferred stocks(1)

 

164.7

 

44.7

Common stocks

 

98.2

 

89.1

 

262.9

 

133.8

Investment expenses

 

(97.6)

 

(78.7)

Interest and dividends

 

2,511.9

 

1,896.2

Share of profit of associates (note 6)

 

956.3

 

1,022.2

(1)On October 30, 2024 the company received a dividend of $112.3 from Digit on the company’s investment in Digit compulsory convertible preferred shares. See note 6 for details.
Schedule of gains (losses) on investment

2024

2023

    

Net change in

    

Net gains

    

    

Net change in

    

Net gains

Net realized

unrealized

(losses) on

Net realized

unrealized

(losses) on

gains (losses)

gains (losses)

investments

gains (losses)

gains (losses)

investments

Common stocks

    

507.0

(210.2)

296.8

    

43.9

420.5

464.4

Bonds and preferred stocks - convertible

18.2

(3.6)

14.6

(0.2)

77.3

77.1

Other equity derivatives(1)(2)

 

375.3

564.0

939.3

 

144.0

213.2

357.2

Disposition of non-insurance associates(3)(4)(5)

 

575.5

 

 

575.5

 

322.0

 

 

322.0

Other

32.8

32.8

(3.1)

(3.1)

Long equity exposures and financial effects

 

1,508.8

 

350.2

 

1,859.0

506.6

 

711.0

 

1,217.6

Bonds

 

(16.5)

 

(590.8)

 

(607.3)

(587.6)

 

1,141.9

 

554.3

U.S. treasury bond forward contracts

 

(90.0)

 

(34.0)

 

(124.0)

 

172.3

 

(12.5)

 

159.8

Total bonds

(106.5)

(624.8)

(731.3)

(415.3)

1,129.4

714.1

Foreign currency(6)

 

166.6

 

(191.8)

 

(25.2)

 

(222.5)

 

103.7

 

(118.8)

Other

(17.9)

(17.4)

(35.3)

1.6

135.0

136.6

Net gains (losses) on investments

 

1,551.0

 

(483.8)

 

1,067.2

 

(129.6)

 

2,079.1

 

1,949.5

(1)Other equity derivatives include long equity total return swaps, equity warrants and options, and during 2023 the Asset Value Loan Notes (“AVLNs”) entered with RiverStone Barbados. Net change in unrealized gains (losses) in 2024 included $515.8 in unrealized gains (2023 - $320.6) on the company’s investment in long equity total return swaps on Fairfax subordinate voting shares principally related to the increase in market value movement on Fairfax subordinate voting shares in the period for which collateral was pledged by the counterparties, with the fair value of $1,032.7 at December 31, 2024 (December 31, 2023 - $516.9) recorded in holding company cash and investments, as described in note 7.
(2)Amounts recorded in net realized gains (losses) include net gains (losses) on total return swaps where the counterparties are generally required to cash-settle monthly or quarterly the market value movement since the previous reset date notwithstanding that the total return swap positions remain open subsequent to the cash settlement. Net realized gains (losses) in 2024 included $517.7 in realized gains (2023 - $304.2) on the company’s investment in long equity total return swaps on Fairfax subordinate voting shares, which represented cash-settlement amounts on market value movement since previous reset date of $295.3 and the cash - settlement of $222.4 on closing $68.5 original notional amount of contracts, recorded in holding company cash and investments.
(3)On November 1, 2024 the company sold its investment in Stelco for total consideration of $638.1 and recorded a net realized gain of $343.7 as described in note 6.
(4)On December 20, 2024 the company acquired additional interests in Peak Achievement, increasing its ownership from 42.6% to 100.0%. Accordingly, the company commenced consolidating Peak Achievement and recorded a realized remeasurement gain of $203.4 in the consolidated statement of earnings as described in note 21.
(5)During 2023 Fairfax India sold a 7.1% equity interest of IIFL Finance for gross proceeds of $177.3 (14.7 billion Indian rupees), which decreased its equity interest to 15.1% and resulted in realized gains of $88.6. Accordingly, the company discontinued recording its residual investment in IIFL Finance under the equity method of accounting, commenced classifying it at FVTPL and recorded a realized remeasurement gain of $204.2 in the consolidated statement of earnings, as described in note 6.
(6)Foreign currency net losses during 2024 were primarily related to foreign currency net losses on investing activities, partially offset by foreign currency net gains on underwriting activities. Foreign currency net losses on investing activities during 2024 primarily related to the strengthening of the U.S. dollar relative to the Brazilian real, Canadian dollar and Egyptian pound on Brazilian real, Canadian dollar and Egyptian pound denominated investments. Foreign currency net gains on investing activities during 2023 primarily related to the strengthening of the Brazilian real, Canadian dollar and British pound sterling relative to the U.S. dollar on Brazilian real, Canadian dollar and British pound sterling denominated investments.