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Segment Information (Tables)
 12 Months Ended
Dec. 31, 2019
Segment Reporting [Abstract]  
Analysis of underwriting income (loss) by segment and reconciliation to net income (loss) available to common shareholders
The following tables summarize the Company’s underwriting income or loss by segment, together with a reconciliation of underwriting income or loss to net income available to Arch common shareholders, summary information regarding net premiums written and earned by major line of business and net premiums written by location:
 
Year Ended December 31, 2019
 
Insurance
 
Reinsurance
 
Mortgage
 
Sub-Total
 
Other
 
Total
Gross premiums written (1)
$
3,907,993

 
$
2,323,223

 
$
1,466,265

 
$
7,695,645

 
$
754,881

 
$
8,138,960

Premiums ceded
(1,266,267
)
 
(720,500
)
 
(204,509
)
 
(2,189,440
)
 
(222,019
)
 
(2,099,893
)
Net premiums written
2,641,726

 
1,602,723

 
1,261,756

 
5,506,205

 
532,862

 
6,039,067

Change in unearned premiums
(244,646
)
 
(136,334
)
 
104,584

 
(276,396
)
 
23,827

 
(252,569
)
Net premiums earned
2,397,080

 
1,466,389

 
1,366,340

 
5,229,809

 
556,689

 
5,786,498

Other underwriting income (loss)
—

 
6,444

 
16,005

 
22,449

 
2,412

 
24,861

Losses and loss adjustment expenses
(1,615,475
)
 
(1,011,329
)
 
(53,513
)
 
(2,680,317
)
 
(453,135
)
 
(3,133,452
)
Acquisition expenses
(361,614
)
 
(239,032
)
 
(134,319
)
 
(734,965
)
 
(105,980
)
 
(840,945
)
Other operating expenses
(454,770
)
 
(141,484
)
 
(153,092
)
 
(749,346
)
 
(51,651
)
 
(800,997
)
Underwriting income (loss)
$
(34,779
)
 
$
80,988

 
$
1,041,421

 
1,087,630

 
(51,665
)
 
1,035,965

 
 
 
 
 
 
 
 
 
 
 
 
Net investment income
 
 
 
 
 
 
491,067

 
136,671

 
627,738

Net realized gains (losses)
 
 
 
 
 
 
351,202

 
15,161

 
366,363

Net impairment losses recognized in earnings
 
 
 
 
 
 
(3,165
)
 
—

 
(3,165
)
Equity in net income (loss) of investments accounted for using the equity method
 
 
 
 
 
 
123,672

 
—

 
123,672

Other income (loss)
 
 
 
 
 
 
2,233

 
—

 
2,233

Corporate expenses
 
 
 
 
 
 
(65,667
)
 
—

 
(65,667
)
Transaction costs and other
 
 
 
 
 
 
(14,444
)
 
—

 
(14,444
)
Amortization of intangible assets
 
 
 
 
 
 
(82,104
)
 
—

 
(82,104
)
Interest expense
 
 
 
 
 
 
(93,735
)
 
(27,137
)
 
(120,872
)
Net foreign exchange gains (losses)
 
 
 
 
 
 
(9,252
)
 
(11,357
)
 
(20,609
)
Income (loss) before income taxes
 
 
 
 
 
 
1,787,437

 
61,673

 
1,849,110

Income tax expense
 
 
 
 
 
 
(155,790
)
 
(20
)
 
(155,810
)
Net income (loss)
 
 
 
 
 
 
1,631,647

 
61,653

 
1,693,300

Dividends attributable to redeemable noncontrolling interests
 
 
 
 
 
 
—

 
(16,909
)
 
(16,909
)
Amounts attributable to nonredeemable noncontrolling interests
 
 
 
 
 
 
—

 
(40,072
)
 
(40,072
)
Net income (loss) available to Arch
 
 
 
 
 
 
1,631,647

 
4,672

 
1,636,319

Preferred dividends
 
 
 
 
 
 
(41,612
)
 
—

 
(41,612
)
Loss on redemption of preferred shares
 
 
 
 
 
 
—

 
—

 
—

Net income (loss) available to Arch common shareholders
 
 
 
 
 
 
$
1,590,035

 
$
4,672

 
$
1,594,707

 
 
 
 
 
 
 
 
 
 
 
 
Underwriting Ratios
 
 
 
 
 
 
 
 
 
 
 
Loss ratio
67.4
%
 
69.0
%
 
3.9
%
 
51.3
%
 
81.4
%
 
54.2
%
Acquisition expense ratio
15.1
%
 
16.3
%
 
9.8
%
 
14.1
%
 
19.0
%
 
14.5
%
Other operating expense ratio
19.0
%
 
9.6
%
 
11.2
%
 
14.3
%
 
9.3
%
 
13.8
%
Combined ratio
101.5
%
 
94.9
%
 
24.9
%
 
79.7
%
 
109.7
%
 
82.5
%
 
 
 
 
 
 
 
 
 
 
 
 
Goodwill and intangible assets
$
289,021

 
$
2,516

 
$
438,896

 
$
730,433

 
$
7,650

 
$
738,083

 
 
 
 
 
 
 
 
 
 
 
 
Total investable assets
 
 
 
 
 
 
$
22,285,676

 
$
2,704,589

 
$
24,990,265

Total assets
 
 
 
 
 
 
34,374,468

 
3,510,893

 
37,885,361

Total liabilities
 
 
 
 
 
 
22,977,636

 
2,592,173

 
25,569,809

(1)
Certain amounts included in the gross premiums written of each segment are related to intersegment transactions. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total.
 
Year Ended December 31, 2018
 
Insurance
 
Reinsurance
 
Mortgage
 
Sub-Total
 
Other
 
Total
Gross premiums written (1)
$
3,262,332

 
$
1,912,522

 
$
1,360,708

 
$
6,534,423

 
$
735,015

 
$
6,961,004

Premiums ceded
(1,050,207
)
 
(539,950
)
 
(202,833
)
 
(1,791,851
)
 
(130,840
)
 
(1,614,257
)
Net premiums written
2,212,125

 
1,372,572

 
1,157,875

 
4,742,572

 
604,175

 
5,346,747

Change in unearned premiums
(6,464
)
 
(111,356
)
 
28,361

 
(89,459
)
 
(25,313
)
 
(114,772
)
Net premiums earned
2,205,661

 
1,261,216

 
1,186,236

 
4,653,113

 
578,862

 
5,231,975

Other underwriting income
—

 
(682
)
 
13,033

 
12,351

 
2,722

 
15,073

Losses and loss adjustment expenses
(1,520,680
)
 
(846,882
)
 
(81,289
)
 
(2,448,851
)
 
(441,255
)
 
(2,890,106
)
Acquisition expenses, net
(349,702
)
 
(211,280
)
 
(118,595
)
 
(679,577
)
 
(125,558
)
 
(805,135
)
Other operating expenses
(364,138
)
 
(133,350
)
 
(142,432
)
 
(639,920
)
 
(37,889
)
 
(677,809
)
Underwriting income (loss)
$
(28,859
)
 
$
69,022

 
$
856,953

 
897,116

 
(23,118
)
 
873,998

 
 
 
 
 
 
 
 
 
 
 
 
Net investment income
 
 
 
 
 
 
437,958

 
125,675

 
563,633

Net realized gains (losses)
 
 
 
 
 
 
(284,429
)
 
(120,915
)
 
(405,344
)
Net impairment losses recognized in earnings
 
 
 
 
 
 
(2,829
)
 
—

 
(2,829
)
Equity in net income (loss) of investments accounted for using the equity method
 
 
 
 
 
 
45,641

 
—

 
45,641

Other income (loss)
 
 
 
 
 
 
2,419

 
—

 
2,419

Corporate expenses
 
 
 
 
 
 
(58,608
)
 
—

 
(58,608
)
Transaction costs and other
 
 
 
 
 
 
(11,386
)
 
(9,000
)
 
(20,386
)
Amortization of intangible assets
 
 
 
 
 
 
(105,670
)
 
—

 
(105,670
)
Interest expense
 
 
 
 
 
 
(101,019
)
 
(19,465
)
 
(120,484
)
Net foreign exchange gains (losses)
 
 
 
 
 
 
58,711

 
10,691

 
69,402

Income (loss) before income taxes
 
 
 
 
 
 
877,904

 
(36,132
)
 
841,772

Income tax (expense) benefit
 
 
 
 
 
 
(113,924
)
 
(27
)
 
(113,951
)
Net income (loss)
 
 
 
 
 
 
763,980

 
(36,159
)
 
727,821

Dividends attributable to redeemable noncontrolling interests
 
 
 
 
 
 
—

 
(18,357
)
 
(18,357
)
Amounts attributable to nonredeemable noncontrolling interests
 
 
 
 
 
 
—

 
48,507

 
48,507

Net income (loss) available to Arch
 
 
 
 
 
 
763,980

 
(6,009
)
 
757,971

Preferred dividends
 
 
 
 
 
 
(41,645
)
 
—

 
(41,645
)
Loss on redemption of preferred shares
 
 
 
 
 
 
(2,710
)
 
—

 
(2,710
)
Net income (loss) available to Arch common shareholders
 
 
 
 
 
 
$
719,625

 
$
(6,009
)
 
$
713,616

 
 
 
 
 
 
 
 
 
 
 
 
Underwriting Ratios
 
 
 
 
 
 
 
 
 
 
 
Loss ratio
68.9
%
 
67.1
%
 
6.9
%
 
52.6
%
 
76.2
%
 
55.2
%
Acquisition expense ratio
15.9
%
 
16.8
%
 
10.0
%
 
14.6
%
 
21.7
%
 
15.4
%
Other operating expense ratio
16.5
%
 
10.6
%
 
12.0
%
 
13.8
%
 
6.5
%
 
13.0
%
Combined ratio
101.3
%
 
94.5
%
 
28.9
%
 
81.0
%
 
104.4
%
 
83.6
%
 
 
 
 
 
 
 
 
 
 
 
 
Goodwill and intangible assets
$
114,012

 
$
—

 
$
513,258

 
$
627,270

 
$
7,650

 
$
634,920

 
 
 
 
 
 
 
 
 
 
 
 
Total investable assets
 
 
 
 
 
 
$
19,566,861

 
$
2,757,663

 
$
22,324,524

Total assets
 
 
 
 
 
 
28,845,473

 
3,372,856

 
32,218,329

Total liabilities
 
 
 
 
 
 
19,518,395

 
2,262,255

 
21,780,650

(1)
Certain amounts included in the gross premiums written of each segment are related to intersegment transactions. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total.

 
Year Ended December 31, 2017
 
Insurance
 
Reinsurance
 
Mortgage
 
Sub-Total
 
Other
 
Total
Gross premiums written (1)
$
3,081,086

 
$
1,640,399

 
$
1,368,138

 
$
6,088,254

 
$
600,304

 
$
6,368,425

Premiums ceded
(958,646
)
 
(465,925
)
 
(256,796
)
 
(1,679,998
)
 
(47,187
)
 
(1,407,052
)
Net premiums written
2,122,440

 
1,174,474

 
1,111,342

 
4,408,256

 
553,117

 
4,961,373

Change in unearned premiums
(9,422
)
 
(31,853
)
 
(54,176
)
 
(95,451
)
 
(21,390
)
 
(116,841
)
Net premiums earned
2,113,018

 
1,142,621

 
1,057,166

 
4,312,805

 
531,727

 
4,844,532

Other underwriting income
—

 
11,336

 
15,737

 
27,073

 
3,180

 
30,253

Losses and loss adjustment expenses
(1,622,444
)
 
(773,923
)
 
(134,677
)
 
(2,531,044
)
 
(436,402
)
 
(2,967,446
)
Acquisition expenses, net
(323,639
)
 
(221,250
)
 
(100,598
)
 
(645,487
)
 
(129,971
)
 
(775,458
)
Other operating expenses
(359,524
)
 
(146,663
)
 
(146,336
)
 
(652,523
)
 
(31,928
)
 
(684,451
)
Underwriting income (loss)
$
(192,589
)
 
$
12,121

 
$
691,292

 
510,824

 
(63,394
)
 
447,430

 
 
 
 
 
 
 
 
 
 
 
 
Net investment income
 
 
 
 
 
 
382,072

 
88,800

 
470,872

Net realized gains (losses)
 
 
 
 
 
 
148,798

 
343

 
149,141

Net impairment losses recognized in earnings
 
 
 
 
 
 
(7,138
)
 
—

 
(7,138
)
Equity in net income (loss) of investments accounted for using the equity method
 
 
 
 
 
 
142,286

 
—

 
142,286

Other income (loss)
 
 
 
 
 
 
(2,571
)
 
—

 
(2,571
)
Corporate expenses
 
 
 
 
 
 
(61,602
)
 
—

 
(61,602
)
Transaction costs and other
 
 
 
 
 
 
(22,150
)
 
—

 
(22,150
)
Amortization of intangible assets
 
 
 
 
 
 
(125,778
)
 
—

 
(125,778
)
Interest expense
 
 
 
 
 
 
(103,592
)
 
(13,839
)
 
(117,431
)
Net foreign exchange gains (losses)
 
 
 
 
 
 
(113,345
)
 
(2,437
)
 
(115,782
)
Income (loss) before income taxes
 
 
 
 
 
 
747,804

 
9,473

 
757,277

Income tax benefit
 
 
 
 
 
 
(127,547
)
 
(21
)
 
(127,568
)
Net income
 
 
 
 
 
 
620,257

 
9,452

 
629,709

Dividends attributable to redeemable noncontrolling interests
 
 
 
 
 
 
—

 
(18,344
)
 
(18,344
)
Amounts attributable to nonredeemable noncontrolling interests
 
 
 
 
 
 
—

 
7,913

 
7,913

Net income (loss) available to Arch
 
 
 
 
 
 
620,257

 
(979
)
 
619,278

Preferred dividends
 
 
 
 
 
 
(46,041
)
 
—

 
(46,041
)
Loss on redemption of preferred shares
 
 
 
 
 
 
(6,735
)
 
—

 
(6,735
)
Net income (loss) available to Arch common shareholders
 
 
 
 
 
 
$
567,481

 
$
(979
)
 
$
566,502

 
 
 
 
 
 
 
 
 
 
 
 
Underwriting Ratios
 
 
 
 
 
 
 
 
 
 
 
Loss ratio
76.8
%
 
67.7
%
 
12.7
%
 
58.7
%
 
82.1
%
 
61.3
%
Acquisition expense ratio
15.3
%
 
19.4
%
 
9.5
%
 
15.0
%
 
24.4
%
 
16.0
%
Other operating expense ratio
17.0
%
 
12.8
%
 
13.8
%
 
15.1
%
 
6.0
%
 
14.1
%
Combined ratio
109.1
%
 
99.9
%
 
36.0
%
 
88.8
%
 
112.5
%
 
91.4
%
 
 
 
 
 
 
 
 
 
 
 
 
Goodwill and intangible assets
$
22,310

 
$
211

 
$
622,440

 
$
644,961

 
$
7,650

 
$
652,611

 
 
 
 
 
 
 
 
 
 
 
 
Total investable assets
 
 
 
 
 
 
$
19,716,421

 
$
2,440,067

 
$
22,156,488

Total assets
 
 
 
 
 
 
29,037,004

 
3,014,654

 
32,051,658

Total liabilities
 
 
 
 
 
 
19,959,574

 
1,846,149

 
21,805,723

(1)
Certain amounts included in the gross premiums written of each segment are related to intersegment transactions. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total.
Summary of information regarding net premiums written and earned by major line of business and net premiums written by location
The following tables provide summary information regarding net premiums earned by major line of business and net premiums written by underwriting location:
INSURANCE SEGMENT
Year Ended December 31,
2019
 
2018
 
2017
Net premiums earned (1)
 
 
 
 
 
Professional lines (2)
$
499,224

 
$
458,425

 
$
444,137

Programs
414,103

 
389,186

 
364,639

Property, energy, marine and aviation
298,966

 
205,069

 
173,779

Construction and national accounts
325,687

 
322,440

 
324,517

Travel, accident and health
305,085

 
297,147

 
257,358

Excess and surplus casualty (3)
200,615

 
172,424

 
195,154

Lenders products
66,079

 
94,248

 
97,043

Other (4)
287,321

 
266,722

 
256,391

Total
$
2,397,080

 
$
2,205,661

 
$
2,113,018

 
 
 
 
 
 
Net premiums written by underwriting location (1)
 
 
 
 
 
United States
$
1,983,476

 
$
1,736,651

 
$
1,715,467

Europe
559,214

 
401,974

 
344,836

Other
99,036

 
73,500

 
62,137

Total
$
2,641,726

 
$
2,212,125

 
$
2,122,440

(1)
Insurance segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions.
(2)
Includes professional liability, executive assurance and healthcare business.
(3)
Includes casualty and contract binding business.
(4)
Includes alternative markets, excess workers' compensation and surety business.
REINSURANCE SEGMENT
Year Ended December 31,
2019

2018

2017
Net premiums earned (1)
 
 
 
 
 
Other specialty (2)
$
478,517

 
$
474,568

 
$
408,566

Casualty (3)
429,288

 
347,034

 
341,122

Property excluding property catastrophe
362,841

 
287,788

 
255,453

Property catastrophe
90,934

 
75,249

 
73,300

Marine and aviation
48,274

 
39,238

 
36,214

Other (4)
56,535

 
37,339

 
27,966

Total
$
1,466,389

 
$
1,261,216

 
$
1,142,621

 
 
 
 
 
 
Net premiums written by underwriting location (1)
 
 
 
 
 
United States
$
529,943

 
$
413,550

 
$
399,379

Bermuda
578,618

 
487,523

 
350,681

Europe and other
494,162

 
471,499

 
424,414

Total
$
1,602,723

 
$
1,372,572

 
$
1,174,474

(1)
Reinsurance segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions.
(2)    Includes proportional motor, surety, accident and health, workers’ compensation catastrophe, agriculture, trade credit and other.
(3)
Includes executive assurance, professional liability, workers’ compensation, excess motor, healthcare and other.
(4)
Includes life, casualty clash and other.

MORTGAGE SEGMENT
Year Ended December 31,
2019
 
2018
 
2017
Net premiums earned by underwriting location
 
 
 
 
 
United States
$
1,134,849

 
$
1,009,765

 
$
901,858

Other
231,491

 
176,471

 
155,308

Total
$
1,366,340

 
$
1,186,236

 
$
1,057,166

 
 
 
 
 
 
Net premiums written by underwriting location
 
 
 
 
 
United States
$
1,032,868

 
$
948,323

 
$
903,329

Other
228,888

 
209,552

 
208,013

Total
$
1,261,756

 
$
1,157,875

 
$
1,111,342


OTHER SEGMENT
Year Ended December 31,
2019
 
2018
 
2017
Net premiums earned (1)
 
 
 
 
 
Casualty (2)
$
246,894

 
$
277,589

 
$
333,275

Other specialty (3)
185,547

 
204,485

 
135,855

Property catastrophe
13,399

 
10,998

 
12,690

Property excluding property catastrophe
3,503

 
2,802

 
1,392

Other (4)
107,346

 
82,988

 
48,515

Total
$
556,689

 
$
578,862

 
$
531,727

 
 
 
 
 
 
Net premiums written by underwriting location (1)
 
 
 
 
 
United States
$
127,176

 
$
49,800

 
$
11,750

Europe
52,065

 
91,635

 
91,463

Bermuda
353,621

 
462,740

 
449,904

Total
$
532,862

 
$
604,175

 
$
553,117

(1)
Other segment results include premiums assumed through intersegment transactions and exclude premiums ceded through intersegment transactions.
(2)
Includes professional liability, excess motor, programs and other.
(3)
Includes proportional motor and other.
(4)
Includes mortgage and other.