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Investment Information
 9 Months Ended
Sep. 30, 2023
Disclosure Investment Information [Abstract]  
Investment
Available For Sale Investments
The following table summarizes the fair value and cost or amortized cost of the Company’s securities classified as available for sale:
Estimated
Fair
Value		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Allowance for Expected Credit Losses Cost or
Amortized
Cost
September 30, 2023
Fixed maturities:
Corporate bonds$10,064 $33 $(747)$(47)$10,825 
U.S. government and government agencies5,662 15 (240)— 5,887 
Asset backed securities2,342 10 (76)(5)2,413 
Non-U.S. government securities2,052 9 (173)(2)2,218 
Commercial mortgage backed securities1,102 — (46)(3)1,151 
Residential mortgage backed securities965 5 (100)— 1,060 
Municipal bonds298 2 (32)— 328 
Total22,485 74 (1,414)(57)23,882 
Short-term investments1,682 3 (1)— 1,680 
Total$24,167 $77 $(1,415)$(57)$25,562 
December 31, 2022
Fixed maturities:
Corporate bonds$8,020 $55 $(781)$(30)$8,776 
U.S. government and government agencies5,162 15 (343)— 5,490 
Asset backed securities1,927 1 (107)(6)2,039 
Non-U.S. government securities2,313 9 (238)(2)2,544 
Commercial mortgage backed securities1,047 1 (58)(3)1,107 
Residential mortgage backed securities795 5 (87)— 877 
Municipal bonds419 3 (33)— 449 
Total19,683 89 (1,647)(41)21,282 
Short-term investments1,332 1 (2)— 1,333 
Total$21,015 $90 $(1,649)$(41)$22,615 
The following table summarizes, for all available for sale securities in an unrealized loss position, the fair value and gross unrealized loss by length of time the security has been in a continual unrealized loss position:
 Less than 12 Months12 Months or MoreTotal
Estimated
Fair
Value		Gross
Unrealized
Losses		Estimated
Fair
Value		Gross
Unrealized
Losses		Estimated
Fair
Value		Gross
Unrealized
Losses
September 30, 2023
Fixed maturities:
Corporate bonds$4,813 $(141)$5,272 $(606)$10,085 $(747)
U.S. government and government agencies3,922 (93)1,294 (147)5,216 (240)
Non-U.S. government securities1,002 (25)956 (148)1,958 (173)
Residential mortgage backed securities420 (15)521 (85)941 (100)
Asset backed securities190 (4)1,287 (72)1,477 (76)
Commercial mortgage backed securities153 (3)907 (43)1,060 (46)
Municipal bonds84 (5)212 (27)296 (32)
Total10,584 (286)10,449 (1,128)21,033 (1,414)
Short-term investments192 (1)— — 192 (1)
Total$10,776 $(287)$10,449 $(1,128)$21,225 $(1,415)
December 31, 2022
Fixed maturities:
Corporate bonds$4,823 $(393)$2,559 $(388)$7,382 $(781)
U.S. government and government agencies3,557 (197)1,443 (146)5,000 (343)
Non-U.S. government securities1,703 (154)542 (84)2,245 (238)
Residential mortgage backed securities546 (52)154 (35)700 (87)
Asset backed securities1,148 (66)512 (41)1,660 (107)
Commercial mortgage backed securities598 (35)445 (23)1,043 (58)
Municipal bonds364 (30)16 (3)380 (33)
Total12,739 (927)5,671 (720)18,410 (1,647)
Short-term investments237 (2)— — 237 (2)
Total$12,976 $(929)$5,671 $(720)$18,647 $(1,649)
At September 30, 2023, on a lot level basis, approximately 11,140 security lots out of a total of approximately 14,320 security lots were in an unrealized loss position and the largest single unrealized loss from a single lot in the Company’s fixed maturity portfolio was $6 million. At December 31, 2022, on a lot level basis, approximately 9,810 security lots out of a total of approximately 12,590 security lots were in an unrealized loss position and the largest single unrealized loss from a single lot in the Company’s fixed maturity portfolio was $7 million.
The contractual maturities of the Company’s fixed maturities are shown in the following table. Expected maturities, which are management’s best estimates, will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
September 30, 2023December 31, 2022
MaturityEstimated
Fair
Value		Amortized
Cost		Estimated
Fair
Value		Amortized
Cost
Due in one year or less$683 $708 $511 $537 
Due after one year through five years12,561 13,123 11,016 11,715 
Due after five years through 10 years4,515 5,035 3,984 4,527 
Due after 10 years317 392 403 480 
 18,076 19,258 15,914 17,259 
Residential mortgage backed securities965 1,060 795 877 
Commercial mortgage backed securities1,102 1,151 1,047 1,107 
Asset backed securities2,342 2,413 1,927 2,039 
Total$22,485 $23,882 $19,683 $21,282 
Equity Securities, at Fair Value
At September 30, 2023, the Company held $894 million of equity securities, at fair value, compared to $860 million at December 31, 2022. Such holdings include publicly traded common stocks primarily in the consumer cyclical and non-cyclical, technology, communication and financial sectors and exchange-traded funds in fixed income, equity and other sectors.
Other Investments, at Fair Value
The following table summarizes the Company’s other investments and other investable assets:
September 30,
2023		December 31,
2022
Other investments$1,404 $1,043 
Fixed maturities 644 554 
Equity securities 7 14 
Short-term investments13 33 
Total$2,068 $1,644 
The following table summarizes the Company’s other investments, as detailed in the previous table, by strategy:
September 30,
2023		December 31,
2022
Lending$460 $406 
Investment grade fixed income418 271 
Term loan investments242 164 
Private equity182 123 
Credit related funds84 56 
Energy18 23 
Total$1,404 $1,043 
Investments Accounted For Using the Equity Method
The following table summarizes the Company’s investments accounted for using the equity method, by strategy:
September 30,
2023		December 31,
2022
Credit related funds$1,165 $1,136 
Private equity1,083 917 
Real estate620 535 
Lending555 531 
Infrastructure298 245 
Fixed income258 130 
Equities171 169 
Energy101 111 
Total$4,251 $3,774 

Certain of the Company’s other investments are in investment funds for which the Company has the option to redeem at agreed upon values as described in each investment fund’s subscription agreement. Depending on the terms of the various subscription agreements, investments in investment funds may be redeemed daily, monthly, quarterly or on other terms. Two common redemption restrictions which may impact the Company’s ability to redeem these investment funds are gates and lockups. A gate is a suspension of redemptions which may be implemented by the general partner or investment manager of the fund in order to defer, in whole or in part, the redemption request in the event the aggregate amount of redemption requests exceeds a predetermined percentage of the investment fund’s net assets which may otherwise hinder the general partner or investment manager’s ability to liquidate holdings in an orderly fashion in order to generate the cash necessary to fund extraordinarily large redemption payouts. A lockup period is the initial amount of time an investor is contractually required to hold the security before having the ability to redeem. If the investment funds are eligible to be redeemed, the time to redeem such fund can take weeks or months following the notification.
Limited Partnership Interests
In the normal course of its activities, the Company invests in limited partnerships as part of its overall investment strategy. Such amounts are included in ‘investments accounted for using the equity method’ and ‘investments accounted for using the fair value option.’ The Company has determined that it is not required to consolidate these investments because it is not the primary beneficiary of the funds. The Company’s maximum exposure to loss with respect to these investments is limited to the investment carrying amounts reported in the Company’s consolidated balance sheet and any unfunded commitment.
The following table summarizes investments in limited partnership interests where the Company has a variable interest by balance sheet line item:
September 30,
2023		December 31,
2022
Investments accounted for using the equity method (1)$4,251 $3,774 
Investments accounted for using the fair value option (2)128 131 
Total$4,379 $3,905 
(1)    Aggregate unfunded commitments were $3.0 billion at September 30, 2023, compared with $2.6 billion at December 31, 2022.
(2)    Aggregate unfunded commitments were $32 million at September 30, 2023, compared to $17 million at December 31, 2022.
Net Investment Income
The components of net investment income were derived from the following sources:
September 30,
 20232022
Three Months Ended
Fixed maturities$243 $124 
Equity securities5 4 
Short-term investments19 9 
Other (1)22 9 
Gross investment income289 146 
Investment expenses(20)(17)
Net investment income$269 $129 
Nine Months Ended
Fixed maturities$645 $311 
Equity securities15 16 
Short-term investments48 16 
Other (1)60 29 
Gross investment income768 372 
Investment expenses(58)(57)
Net investment income$710 $315 
(1)    Amounts include dividends and other distributions on investment funds, term loan investments, funds held balances, cash balances and other items.

Net Realized Gains (Losses)
Net realized gains (losses), which include changes in the allowance for credit losses on financial assets and net impairment losses recognized in earnings were as follows:
September 30,
 20232022
Three Months Ended
Available for sale securities:  
Gross gains on investment sales$12 $18 
Gross losses on investment sales(116)(74)
Change in fair value of assets and liabilities accounted for using the fair value option:
Fixed maturities(16)(19)
Other investments3 (18)
Equity securities— (1)
Short-term investments— (1)
Equity securities, at fair value:
Net realized gains (losses) on sales during the period14 (6)
Net unrealized gains (losses) on equity securities still held at reporting date(46)(36)
Allowance for credit losses:
Investments related— 9 
Underwriting related(1)(4)
Derivative instruments (1)(102)(48)
Other4 (4)
Net realized gains (losses)$(248)$(184)
Nine Months Ended
Available for sale securities:
Gross gains on investment sales$51 $53 
Gross losses on investment sales(396)(239)
Change in fair value of assets and liabilities accounted for using the fair value option:
Fixed maturities(12)(89)
Other investments17 (37)
Equity securities1 (6)
Short-term investments— (3)
Equity securities, at fair value:
Net realized gains (losses) on sales during the period50 76 
Net unrealized gains (losses) on equity securities still held at reporting date17 (318)
Allowance for credit losses:
Investments related(23)(48)
Underwriting related(2)(7)
Derivative instruments (1)(61)(118)
Other4 (7)
Net realized gains (losses)$(354)$(743)
(1)    See note 9 for information on the Company’s derivative instruments.
Equity in Net Income (Loss) of Investment Funds Accounted for Using the Equity Method
The Company recorded income of $59 million related to investment funds accounted for using the equity method in the 2023 third quarter, compared to a loss of $19 million for
the 2022 third quarter and income of $176 million for the nine months ended September 30, 2023, compared to income of $75 million for nine months ended September 30, 2022. In applying the equity method, investments are initially recorded at cost and are subsequently adjusted based on the Company’s proportionate share of the net income or loss of the funds (which include changes in the market value of the underlying securities in the funds). Such investments are generally recorded on a one to three month lag based on the availability of reports from the investment funds.
Investments in Operating Affiliates
Investments in which the Company has significant influence over the operating and financial policies are classified as ‘investments in operating affiliates’ on the Company’s balance sheets and are accounted for under the equity method. Such investments primarily include the Company’s investment in Coface SA (“Coface”), Greysbridge Holdings Ltd., (“Greysbridge”) and Premia Holdings Ltd. Investments in Coface and Premia Holdings Ltd. are generally recorded on a three month lag, while the Company’s investment in
Greysbridge is not recorded on a lag.
As of September 30, 2023, the Company owned approximately 29.9% of the issued shares of Coface, or 30% excluding treasury shares, with a carrying value of $521 million, compared to $563 million at December 31, 2022.
As of September 30, 2023, the Company owned 40% of Greysbridge with a carrying value of $362 million, compared to $306 million at December 31, 2022.
Income from operating affiliates for the 2023 third quarter was $54 million, compared to $9 million, for the 2022 third quarter, and income of $115 million for the nine months ended September 30, 2023, compared to income of $39 million for nine months ended September 30, 2022.
See note 15 for information on Company’s transactions with related parties.
Allowance for Expected Credit Losses
The following table provides a roll forward of the allowance for expected credit losses of the Company’s securities classified as available for sale:
Structured Securities (1)Corporate
Bonds		Non-U.S.
Government
Securities		Total
Three Months Ended September 30, 2023
Balance at beginning of period$8 $50 $3 $61 
Additions for current-period provision for expected credit losses2 4 — 6 
Additions (reductions) for previously recognized expected credit losses — (3)— (3)
Reductions due to disposals(2)(4)(1)(7)
Balance at end of period$8 $47 $2 $57 
Three Months Ended September 30, 2022
Balance at beginning of period$19 $40 $— $59 
Additions for current-period provision for expected credit losses2 2 — 4 
Additions (reductions) for previously recognized expected credit losses (10)(3)— (13)
Reductions due to disposals(2)(2)— (4)
Balance at end of period$9 $37 $— $46 
Nine Months Ended September 30, 2023
Balance at beginning of period$9 $30 $2 $41 
Additions for current-period provision for expected credit losses2 5 — 7 
Additions (reductions) for previously recognized expected credit losses(1)18 1 18 
Reductions due to disposals(2)(6)(1)(9)
Balance at end of period$8 $47 $2 $57 
Nine Months Ended September 30, 2022
Balance at beginning of period$1 $2 $— $3 
Additions for current-period provision for expected credit losses13 40 — 53 
Additions (reductions) for previously recognized expected credit losses(3)(3)— (6)
Reductions due to disposals(2)(2)— (4)
Balance at end of period$9 $37 $— $46 
(1)    Includes asset backed securities, residential mortgage backed securities and commercial mortgage backed securities.
Restricted Assets
The Company is required to maintain assets on deposit, which primarily consist of fixed maturities, with various regulatory authorities to support its underwriting operations. The Company’s subsidiaries maintain assets in trust accounts as collateral for transactions with affiliated companies and also have investments in segregated portfolios primarily to provide collateral or guarantees for letters of credit to third parties. See note 18, “Commitments and Contingencies,” of the notes to consolidated financial statements in the Company’s 2022 Form 10-K.
The following table details the value of the Company’s restricted assets:
September 30,
2023		December 31,
2022
Assets used for collateral or guarantees:  
Affiliated transactions$4,572 $4,254 
Third party agreements2,849 2,633 
Deposits with U.S. regulatory authorities788 776 
Other (1)1,250 1,038 
Total restricted assets$9,459 $8,701 
(1)    Primarily includes Funds at Lloyds, deposits with non-U.S. regulatory authorities and other restricted assets.
Reconciliation of Cash and Restricted Cash
The following table details reconciliation of cash and restricted cash within the Consolidated Balance Sheets:
September 30,
2023		December 31,
2022
Cash$859 $855 
Restricted cash (included in ‘other assets’)496 418 
Cash and restricted cash$1,355 $1,273