Segment Information

9 Months Ended

Sep. 30, 2011

Segment Reporting [Abstract]

Segment Information

5.       Segment Information

The Company classifies its businesses into two underwriting segments – insurance and reinsurance – and corporate and other (non-underwriting). Management measures segment performance based on underwriting income or loss. The Company does not manage its assets by segment and, accordingly, investment income is not allocated to each underwriting segment. In addition, other revenue and expense items are not evaluated by segment.

The following tablesummarizes the Company's underwriting income or loss by segment, together with a reconciliation of underwriting income or loss to net income available to common shareholders, for the 2011 third quarter and 2010 third quarter:

		Three Months Ended						Three Months Ended
		September 30, 2011						September 30, 2010
		Insurance		Reinsurance		Total		Insurance		Reinsurance		Total
Gross premiums written (1)		$	634,280	$	227,837	$	860,289	$	624,490	$	208,770	$	831,788
Net premiums written			472,986		218,395		691,381		431,361		204,756		636,117
Net premiums earned		$	437,970	$	244,079	$	682,049	$	411,881	$	215,528	$	627,409
Fee income			661		187		848		864		10		874
Losses and loss adjustment
	expenses		(290,608)		(133,376)		(423,984)		(265,411)		(93,782)		(359,193)
Acquisition expenses, net			(76,763)		(43,442)		(120,205)		(67,309)		(43,970)		(111,279)
Other operating expenses			(77,078)		(22,740)		(99,818)		(77,078)		(20,247)		(97,325)
Underwriting income (loss)		$	(5,818)	$	44,708		38,890	$	2,947	$	57,539		60,486
Net investment income							82,753						90,768
Net realized gains							30,199						68,828
Net impairment losses
	recognized in earnings						(2,739)						(2,075)
Equity in net income (loss)
	of investment funds
	accounted for using
	the equity method						(30,549)						9,708
Other income							2,432						1,840
Other expenses							(6,180)						(5,796)
Interest expense							(8,125)						(7,371)
Net foreign exchange gains
	(losses)						60,040						(65,157)
Income before income taxes							166,721						151,231
Income tax benefit (expense)							2,267						(3,200)
Net income							168,988						148,031
Preferred dividends							(6,461)						(6,461)
Net income available to
	common shareholders					$	162,527					$	141,570
Underwriting Ratios
Loss ratio			66.4%		54.6%		62.2%		64.4%		43.5%		57.3%
Acquisition expense ratio (2)			17.4%		17.8%		17.5%		16.1%		20.4%		17.6%
Other operating expense ratio			17.6%		9.3%		14.6%		18.7%		9.4%		15.5%
Combined ratio			101.4%		81.7%		94.3%		99.2%		73.3%		90.4%

• 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.
• The acquisition expense ratio is adjusted to include policy-related fee income.

The following tablesummarizes the Company's underwriting income or loss by segment, together with a reconciliation of underwriting income or loss to net income available to common shareholders, for the nine months ended September 30, 2011 and 2010:

		Nine Months Ended						Nine Months Ended
		September 30, 2011						September 30, 2010
		Insurance		Reinsurance		Total		Insurance		Reinsurance		Total
Gross premiums written (1)		$	1,903,868	$	836,616	$	2,736,794	$	1,874,419	$	735,942	$	2,602,575
Net premiums written			1,360,540		801,662		2,162,202		1,307,122		721,007		2,028,129
Net premiums earned		$	1,256,380	$	702,243	$	1,958,623	$	1,246,831	$	673,506	$	1,920,337
Fee income			2,141		306		2,447		2,491		60		2,551
Losses and loss adjustment
	expenses		(889,973)		(459,513)		(1,349,486)		(852,716)		(297,673)		(1,150,389)
Acquisition expenses, net			(204,721)		(134,877)		(339,598)		(200,099)		(136,279)		(336,378)
Other operating expenses			(228,580)		(65,798)		(294,378)		(229,525)		(59,948)		(289,473)
Underwriting income (loss)		$	(64,753)	$	42,361		(22,392)	$	(33,018)	$	179,666		146,648
Net investment income							257,731						274,277
Net realized gains							96,104						178,724
Net impairment losses
	recognized in earnings						(7,103)						(8,091)
Equity in net income of
	investment funds
	accounted for using
	the equity method						5,097						38,410
Other income							2,734						12,346
Other expenses							(24,603)						(21,987)
Interest expense							(23,604)						(22,547)
Net foreign exchange gains							4,753						22,069
Income before income taxes							288,717						619,849
Income tax benefit (expense)							4,369						(11,373)
Net income							293,086						608,476
Preferred dividends							(19,383)						(19,383)
Net income available to
	common shareholders					$	273,703					$	589,093
Underwriting Ratios
Loss ratio			70.8%		65.4%		68.9%		68.4%		44.2%		59.9%
Acquisition expense ratio (2)			16.1%		19.2%		17.2%		15.8%		20.2%		17.4%
Other operating expense ratio			18.2%		9.4%		15.0%		18.4%		8.9%		15.1%
Combined ratio			105.1%		94.0%		101.1%		102.6%		73.3%		92.4%

• 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.
• The acquisition expense ratio is adjusted to include policy-related fee income.