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þ
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QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
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Delaware
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22-1867895
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(State or other jurisdiction of
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(I.R.S. Employer
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incorporation or organization)
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Identification No.)
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475 Steamboat Road, Greenwich, Connecticut
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06830
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(Address of principal executive offices)
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(Zip Code)
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(203) 629-3000
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(Registrant’s telephone number, including area code)
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None
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Former name, former address and former fiscal year, if changed since last report
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Large accelerated filer
þ
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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(Do not check if a smaller reporting company)
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EX-10.1
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EX-31.1
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EX-31.2
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EX-32.1
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EX-101 INSTANCE DOCUMENT
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EX-101 SCHEMA DOCUMENT
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EX-101 CALCULATION LINKBASE DOCUMENT
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EX-101 LABELS LINKBASE DOCUMENT
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EX-101 PRESENTATION LINKBASE DOCUMENT
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EX-101 DEFINITION LINKBASE DOCUMENT
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Item 1.
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Financial Statements
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March 31,
2016 |
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December 31,
2015 |
||||
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(Unaudited)
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(Audited)
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||||
Assets
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|
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|
||||
Investments:
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|
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||||
Fixed maturity securities
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$
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12,745,436
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$
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12,444,394
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Investment funds
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1,179,310
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1,170,040
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Real estate
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986,810
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936,367
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Arbitrage trading account
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384,519
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376,697
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Loans receivable
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149,388
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273,103
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Equity securities
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141,699
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150,866
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Total investments
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15,587,162
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15,351,467
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Cash and cash equivalents
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837,515
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763,631
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Premiums and fees receivable
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1,749,273
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1,669,186
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Due from reinsurers
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1,558,749
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1,532,829
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Deferred policy acquisition costs
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547,519
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513,128
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Prepaid reinsurance premiums
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429,058
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394,387
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Trading account receivables from brokers and clearing organizations
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373,833
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383,115
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Property, furniture and equipment
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346,471
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348,224
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Goodwill
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153,747
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153,291
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Accrued investment income
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130,380
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123,164
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Federal and foreign income taxes
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—
|
|
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48,952
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Other assets
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517,227
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|
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442,782
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Total assets
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$
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22,230,934
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$
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21,724,156
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||||
Liabilities and Equity
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||||
Liabilities:
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|
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Reserves for losses and loss expenses
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$
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10,788,342
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$
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10,669,150
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Unearned premiums
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3,314,676
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3,137,133
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Due to reinsurers
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256,838
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224,752
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Trading account securities sold but not yet purchased
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35,956
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37,035
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Federal and foreign income taxes
|
31,291
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—
|
|
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Other liabilities
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754,292
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837,937
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Senior notes and other debt
|
1,814,998
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1,844,621
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Subordinated debentures
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446,485
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340,320
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Total liabilities
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17,442,878
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17,090,948
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Equity:
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||||
Preferred stock, par value $.10 per share:
|
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Authorized 5,000,000 shares; issued and outstanding - none
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Common stock, par value $.20 per share:
|
|
|
|
||||
Authorized 500,000,000 shares, issued and outstanding, net of treasury shares, 122,599,552 and 123,307,837 shares, respectively
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47,024
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47,024
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Additional paid-in capital
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1,013,572
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1,005,455
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Retained earnings
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6,282,870
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6,178,070
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Accumulated other comprehensive income (loss)
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8,124
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|
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(66,698
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)
|
||
Treasury stock, at cost, 112,518,366 and 111,810,081 shares, respectively
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(2,600,377
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)
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(2,563,605
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)
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Total stockholders’ equity
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4,751,213
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4,600,246
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Noncontrolling interests
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36,843
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32,962
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Total equity
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4,788,056
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4,633,208
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Total liabilities and equity
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$
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22,230,934
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$
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21,724,156
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For the Three Months
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||||||
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Ended March 31,
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||||||
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2016
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2015
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REVENUES:
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Net premiums written
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$
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1,663,722
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$
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1,575,402
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Change in net unearned premiums
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(136,387
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)
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(103,389
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)
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Net premiums earned
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1,527,335
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1,472,013
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Net investment income
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130,133
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124,239
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Insurance service fees
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40,362
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36,518
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Net realized investment gains
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25,457
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19,044
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|
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Other-than-temporary impairments
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(18,114
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)
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—
|
|
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Revenues from non-insurance businesses
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101,780
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92,606
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Other income
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258
|
|
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259
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Total revenues
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1,807,211
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1,744,679
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OPERATING COSTS AND EXPENSES:
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Losses and loss expenses
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922,321
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900,708
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Other operating costs and expenses
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582,459
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551,046
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Expenses from non-insurance businesses
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95,531
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89,670
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Interest expense
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32,224
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34,538
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Total operating costs and expenses
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1,632,535
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1,575,962
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Income before income taxes
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174,676
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168,717
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Income tax expense
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(54,428
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)
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(50,273
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)
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Net income before noncontrolling interests
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120,248
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118,444
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Noncontrolling interests
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(737
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)
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(137
|
)
|
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Net income to common stockholders
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$
|
119,511
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$
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118,307
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||||
NET INCOME PER SHARE:
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||||
Basic
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$
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0.97
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$
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0.94
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Diluted
|
$
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0.93
|
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$
|
0.89
|
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For the Three Months
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||||||
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Ended March 31,
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||||||
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2016
|
|
2015
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||||
Net income before noncontrolling interests
|
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$
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120,248
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|
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$
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118,444
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Other comprehensive income (loss):
|
|
|
|
|
||||
Change in unrealized currency translation adjustments
|
|
(2,047
|
)
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(47,805
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)
|
||
Change in unrealized investment gains, net of taxes
|
|
76,855
|
|
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16,291
|
|
||
Other comprehensive income (loss)
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74,808
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(31,514
|
)
|
||
Comprehensive income
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|
195,056
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|
|
86,930
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|
||
Comprehensive (income) to the noncontrolling interest
|
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(723
|
)
|
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(115
|
)
|
||
Comprehensive income to common stockholders
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$
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194,333
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|
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$
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86,815
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For the Three Months
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||||||
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Ended March 31,
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||||||
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2016
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2015
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||||
COMMON STOCK:
|
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|
||||
Beginning and end of period
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$
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47,024
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$
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47,024
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ADDITIONAL PAID-IN CAPITAL:
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|
||||
Beginning of period
|
$
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1,005,455
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$
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991,512
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Stock options exercised and restricted stock units issued including tax benefit
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(652
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)
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(1,678
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)
|
||
Restricted stock units expensed
|
8,769
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|
|
8,171
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|
||
End of period
|
$
|
1,013,572
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|
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$
|
998,005
|
|
RETAINED EARNINGS:
|
|
|
|
||||
Beginning of period
|
$
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6,178,070
|
|
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$
|
5,732,410
|
|
Net income to common stockholders
|
119,511
|
|
|
118,307
|
|
||
Dividends
|
(14,711
|
)
|
|
(13,749
|
)
|
||
End of period
|
$
|
6,282,870
|
|
|
$
|
5,836,968
|
|
ACCUMULATED OTHER COMPREHENSIVE INCOME:
|
|
|
|
||||
Unrealized investment gains:
|
|
|
|
||||
Beginning of period
|
$
|
180,695
|
|
|
$
|
306,199
|
|
Unrealized gains on securities not other-than-temporarily impaired
|
76,904
|
|
|
16,308
|
|
||
Unrealized gains (losses) on other-than-temporarily impaired securities
|
(35
|
)
|
|
5
|
|
||
End of period
|
257,564
|
|
|
322,512
|
|
||
Currency translation adjustments:
|
|
|
|
||||
Beginning of period
|
$
|
(247,393
|
)
|
|
$
|
(122,649
|
)
|
Net change in period
|
(2,047
|
)
|
|
(47,805
|
)
|
||
End of period
|
(249,440
|
)
|
|
(170,454
|
)
|
||
Total accumulated other comprehensive income
|
$
|
8,124
|
|
|
$
|
152,058
|
|
TREASURY STOCK:
|
|
|
|
||||
Beginning of period
|
$
|
(2,563,605
|
)
|
|
$
|
(2,364,551
|
)
|
Stock exercised/vested
|
652
|
|
|
331
|
|
||
Stock repurchased
|
(37,424
|
)
|
|
(91,213
|
)
|
||
End of period
|
$
|
(2,600,377
|
)
|
|
$
|
(2,455,433
|
)
|
NONCONTROLLING INTERESTS:
|
|
|
|
||||
Beginning of period
|
$
|
32,962
|
|
|
$
|
34,189
|
|
Contributions
|
3,158
|
|
|
111
|
|
||
Net income
|
737
|
|
|
137
|
|
||
Other comprehensive (loss), net of tax
|
(14
|
)
|
|
(22
|
)
|
||
End of period
|
$
|
36,843
|
|
|
$
|
34,415
|
|
|
For the Three Months
|
||||||
|
Ended March 31,
|
||||||
|
2016
|
|
2015
|
||||
CASH FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net income to common stockholders
|
$
|
119,511
|
|
|
$
|
118,307
|
|
Adjustments to reconcile net income to net cash from operating activities:
|
|
|
|
||||
Net investment gains
|
(7,343
|
)
|
|
(19,044
|
)
|
||
Depreciation and amortization
|
30,245
|
|
|
19,203
|
|
||
Noncontrolling interests
|
737
|
|
|
137
|
|
||
Investment funds
|
(16,636
|
)
|
|
(6,061
|
)
|
||
Stock incentive plans
|
8,766
|
|
|
8,171
|
|
||
Change in:
|
|
|
|
||||
Arbitrage trading account
|
383
|
|
|
7,692
|
|
||
Premiums and fees receivable
|
(79,531
|
)
|
|
(71,181
|
)
|
||
Reinsurance accounts
|
(26,319
|
)
|
|
(46,260
|
)
|
||
Deferred policy acquisition costs
|
(33,466
|
)
|
|
(21,314
|
)
|
||
Income taxes
|
46,780
|
|
|
44,618
|
|
||
Reserves for losses and loss expenses
|
108,057
|
|
|
152,925
|
|
||
Unearned premiums
|
171,553
|
|
|
117,403
|
|
||
Other
|
(181,969
|
)
|
|
(243,584
|
)
|
||
Net cash from operating activities
|
140,768
|
|
|
61,012
|
|
||
CASH FROM (USED IN) INVESTING ACTIVITIES:
|
|
|
|
||||
Proceeds from sale of fixed maturity securities
|
381,732
|
|
|
466,276
|
|
||
Proceeds from sale of equity securities
|
1,880
|
|
|
9,785
|
|
||
Distributions from investment funds
|
15,788
|
|
|
(9,363
|
)
|
||
Proceeds from maturities and prepayments of fixed maturity securities
|
455,463
|
|
|
655,349
|
|
||
Purchase of fixed maturity securities
|
(1,032,129
|
)
|
|
(1,094,439
|
)
|
||
Purchase of equity securities
|
(1,108
|
)
|
|
(8,882
|
)
|
||
Real estate purchased
|
(53,781
|
)
|
|
(44,162
|
)
|
||
Change in loans receivable
|
123,737
|
|
|
41,244
|
|
||
Net additions to property, furniture and equipment
|
(12,461
|
)
|
|
(7,680
|
)
|
||
Change in balances due to security brokers
|
69,642
|
|
|
(2,652
|
)
|
||
Payment for business purchased net of cash aquired
|
(54,313
|
)
|
|
—
|
|
||
Net cash from (used in) investing activities
|
(105,550
|
)
|
|
5,476
|
|
||
CASH FROM (USED IN) FINANCING ACTIVITIES:
|
|
|
|
||||
Repayment of senior notes and other debt
|
(33,721
|
)
|
|
(3,240
|
)
|
||
Net proceeds from issuance of debt
|
110,093
|
|
|
—
|
|
||
Cash dividends to common stockholders
|
(14,711
|
)
|
|
(13,749
|
)
|
||
Purchase of common treasury shares
|
(37,424
|
)
|
|
(91,213
|
)
|
||
Other, net
|
3,158
|
|
|
(1,187
|
)
|
||
Net cash from (used in) financing activities
|
27,395
|
|
|
(109,389
|
)
|
||
Net impact on cash due to change in foreign exchange rates
|
11,271
|
|
|
(16,845
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
73,884
|
|
|
(59,746
|
)
|
||
Cash and cash equivalents at beginning of year
|
763,631
|
|
|
674,441
|
|
||
Cash and cash equivalents at end of period
|
$
|
837,515
|
|
|
$
|
614,695
|
|
(In thousands)
|
2016
|
||
|
|
||
Cash and cash equivalents
|
$
|
1,072
|
|
Real estate, furniture and equipment
|
701
|
|
|
Goodwill and other intangibles assets
|
40,282
|
|
|
Premiums and service fees receivable
|
3,845
|
|
|
Other assets
|
5,166
|
|
|
Total assets acquired
|
51,066
|
|
|
|
|
||
Other liabilities assumed
|
(4,931
|
)
|
|
Noncontrolling interest
|
(3,850
|
)
|
|
Net assets acquired
|
$
|
42,285
|
|
(In thousands)
|
Amortized
Cost
|
|
Gross Unrealized
|
|
Fair
Value
|
|
Carrying
Value
|
||||||||||||
Gains
|
|
Losses
|
|
||||||||||||||||
March 31, 2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Held to maturity:
|
|
|
|
|
|
|
|
|
|
||||||||||
State and municipal
|
$
|
78,264
|
|
|
$
|
17,340
|
|
|
$
|
—
|
|
|
$
|
95,604
|
|
|
$
|
78,264
|
|
Residential mortgage-backed
|
18,405
|
|
|
2,470
|
|
|
—
|
|
|
20,875
|
|
|
18,405
|
|
|||||
Total held to maturity
|
96,669
|
|
|
19,810
|
|
|
—
|
|
|
116,479
|
|
|
96,669
|
|
|||||
Available for sale:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. government and government agency
|
571,330
|
|
|
27,602
|
|
|
(981
|
)
|
|
597,951
|
|
|
597,951
|
|
|||||
State and municipal:
|
|
|
|
|
|
|
|
|
|
||||||||||
Special revenue
|
2,613,723
|
|
|
120,174
|
|
|
(2,047
|
)
|
|
2,731,850
|
|
|
2,731,850
|
|
|||||
State general obligation
|
595,465
|
|
|
30,624
|
|
|
(1,817
|
)
|
|
624,272
|
|
|
624,272
|
|
|||||
Pre-refunded
|
407,586
|
|
|
32,630
|
|
|
—
|
|
|
440,216
|
|
|
440,216
|
|
|||||
Corporate backed
|
388,408
|
|
|
15,034
|
|
|
(618
|
)
|
|
402,824
|
|
|
402,824
|
|
|||||
Local general obligation
|
356,266
|
|
|
29,357
|
|
|
(17
|
)
|
|
385,606
|
|
|
385,606
|
|
|||||
Total state and municipal
|
4,361,448
|
|
|
227,819
|
|
|
(4,499
|
)
|
|
4,584,768
|
|
|
4,584,768
|
|
|||||
Mortgage-backed securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential (1)
|
1,067,877
|
|
|
27,520
|
|
|
(5,548
|
)
|
|
1,089,849
|
|
|
1,089,849
|
|
|||||
Commercial
|
65,138
|
|
|
778
|
|
|
(616
|
)
|
|
65,300
|
|
|
65,300
|
|
|||||
Total mortgage-backed securities
|
1,133,015
|
|
|
28,298
|
|
|
(6,164
|
)
|
|
1,155,149
|
|
|
1,155,149
|
|
|||||
Asset-backed
|
1,855,301
|
|
|
11,949
|
|
|
(22,846
|
)
|
|
1,844,404
|
|
|
1,844,404
|
|
|||||
Corporate:
|
|
|
|
|
|
|
|
|
|
||||||||||
Industrial
|
2,007,460
|
|
|
106,650
|
|
|
(20,538
|
)
|
|
2,093,572
|
|
|
2,093,572
|
|
|||||
Financial
|
1,176,238
|
|
|
39,566
|
|
|
(13,664
|
)
|
|
1,202,140
|
|
|
1,202,140
|
|
|||||
Utilities
|
197,336
|
|
|
10,771
|
|
|
(1,958
|
)
|
|
206,149
|
|
|
206,149
|
|
|||||
Other
|
66,289
|
|
|
426
|
|
|
—
|
|
|
66,715
|
|
|
66,715
|
|
|||||
Total corporate
|
3,447,323
|
|
|
157,413
|
|
|
(36,160
|
)
|
|
3,568,576
|
|
|
3,568,576
|
|
|||||
Foreign
|
849,800
|
|
|
54,580
|
|
|
(6,461
|
)
|
|
897,919
|
|
|
897,919
|
|
|||||
Total available for sale
|
12,218,217
|
|
|
507,661
|
|
|
(77,111
|
)
|
|
12,648,767
|
|
|
12,648,767
|
|
|||||
Total investments in fixed maturity securities
|
$
|
12,314,886
|
|
|
$
|
527,471
|
|
|
$
|
(77,111
|
)
|
|
$
|
12,765,246
|
|
|
$
|
12,745,436
|
|
(In thousands)
|
Amortized
Cost |
|
Gross Unrealized
|
|
Fair
Value |
|
Carrying
Value |
||||||||||||
Gains
|
|
Losses
|
|||||||||||||||||
December 31, 2015
|
|
|
|
|
|
|
|
|
|
||||||||||
Held to maturity:
|
|
|
|
|
|
|
|
|
|
||||||||||
State and municipal
|
$
|
77,129
|
|
|
$
|
16,246
|
|
|
$
|
—
|
|
|
$
|
93,375
|
|
|
$
|
77,129
|
|
Residential mortgage-backed
|
19,138
|
|
|
2,207
|
|
|
—
|
|
|
21,345
|
|
|
19,138
|
|
|||||
Total held to maturity
|
96,267
|
|
|
18,453
|
|
|
—
|
|
|
114,720
|
|
|
96,267
|
|
|||||
Available for sale:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. government and government agency
|
645,092
|
|
|
27,660
|
|
|
(2,333
|
)
|
|
670,419
|
|
|
670,419
|
|
|||||
State and municipal:
|
|
|
|
|
|
|
|
|
|
||||||||||
Special revenue
|
2,510,816
|
|
|
102,909
|
|
|
(3,737
|
)
|
|
2,609,988
|
|
|
2,609,988
|
|
|||||
State general obligation
|
583,456
|
|
|
28,068
|
|
|
(2,070
|
)
|
|
609,454
|
|
|
609,454
|
|
|||||
Pre-refunded
|
439,772
|
|
|
32,056
|
|
|
(31
|
)
|
|
471,797
|
|
|
471,797
|
|
|||||
Corporate backed
|
388,904
|
|
|
14,039
|
|
|
(402
|
)
|
|
402,541
|
|
|
402,541
|
|
|||||
Local general obligation
|
342,158
|
|
|
24,270
|
|
|
(29
|
)
|
|
366,399
|
|
|
366,399
|
|
|||||
Total state and municipal
|
4,265,106
|
|
|
201,342
|
|
|
(6,269
|
)
|
|
4,460,179
|
|
|
4,460,179
|
|
|||||
Mortgage-backed securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential (1)
|
1,126,382
|
|
|
18,935
|
|
|
(11,180
|
)
|
|
1,134,137
|
|
|
1,134,137
|
|
|||||
Commercial
|
64,975
|
|
|
875
|
|
|
(128
|
)
|
|
65,722
|
|
|
65,722
|
|
|||||
Total mortgage-backed securities
|
1,191,357
|
|
|
19,810
|
|
|
(11,308
|
)
|
|
1,199,859
|
|
|
1,199,859
|
|
|||||
Asset-backed
|
1,706,694
|
|
|
12,892
|
|
|
(14,414
|
)
|
|
1,705,172
|
|
|
1,705,172
|
|
|||||
Corporate:
|
|
|
|
|
|
|
|
|
|
||||||||||
Industrial
|
1,976,393
|
|
|
75,168
|
|
|
(30,027
|
)
|
|
2,021,534
|
|
|
2,021,534
|
|
|||||
Financial
|
1,153,096
|
|
|
31,744
|
|
|
(11,819
|
)
|
|
1,173,021
|
|
|
1,173,021
|
|
|||||
Utilities
|
192,857
|
|
|
8,321
|
|
|
(2,527
|
)
|
|
198,651
|
|
|
198,651
|
|
|||||
Other
|
81,607
|
|
|
245
|
|
|
(20
|
)
|
|
81,832
|
|
|
81,832
|
|
|||||
Total corporate
|
3,403,953
|
|
|
115,478
|
|
|
(44,393
|
)
|
|
3,475,038
|
|
|
3,475,038
|
|
|||||
Foreign
|
799,839
|
|
|
50,310
|
|
|
(12,689
|
)
|
|
837,460
|
|
|
837,460
|
|
|||||
Total available for sale
|
12,012,041
|
|
|
427,492
|
|
|
(91,406
|
)
|
|
12,348,127
|
|
|
12,348,127
|
|
|||||
Total investments in fixed maturity securities
|
$
|
12,108,308
|
|
|
$
|
445,945
|
|
|
$
|
(91,406
|
)
|
|
$
|
12,462,847
|
|
|
$
|
12,444,394
|
|
(1)
|
Gross unrealized losses for residential mortgage-backed securities include
$1,324,214
and
$1,269,491
as of
March 31, 2016
and
December 31, 2015
, respectively, related to the non-credit portion of other-than-temporary impairments (“OTTI”) recognized in accumulated other comprehensive income.
|
(In thousands)
|
Amortized
Cost
|
|
Fair Value
|
||||
Due in one year or less
|
$
|
812,491
|
|
|
$
|
822,851
|
|
Due after one year through five years
|
4,360,294
|
|
|
4,522,431
|
|
||
Due after five years through ten years
|
3,482,275
|
|
|
3,659,124
|
|
||
Due after ten years
|
2,508,406
|
|
|
2,584,816
|
|
||
Mortgage-backed securities
|
1,151,420
|
|
|
1,176,024
|
|
||
Total
|
$
|
12,314,886
|
|
|
$
|
12,765,246
|
|
(In thousands)
|
Cost
|
|
Gross Unrealized
|
|
Fair
Value
|
|
Carrying
Value
|
||||||||||||
Gains
|
|
Losses
|
|
||||||||||||||||
March 31, 2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stocks
|
$
|
38,686
|
|
|
$
|
424
|
|
|
$
|
(1,539
|
)
|
|
$
|
37,571
|
|
|
$
|
37,571
|
|
Preferred stocks
|
106,990
|
|
|
7,582
|
|
|
(10,444
|
)
|
|
104,128
|
|
|
104,128
|
|
|||||
Total
|
$
|
145,676
|
|
|
$
|
8,006
|
|
|
$
|
(11,983
|
)
|
|
$
|
141,699
|
|
|
$
|
141,699
|
|
December 31, 2015
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stocks
|
$
|
56,462
|
|
|
$
|
—
|
|
|
$
|
(19,189
|
)
|
|
$
|
37,273
|
|
|
$
|
37,273
|
|
Preferred stocks
|
108,730
|
|
|
8,216
|
|
|
(3,353
|
)
|
|
113,593
|
|
|
113,593
|
|
|||||
Total
|
$
|
165,192
|
|
|
$
|
8,216
|
|
|
$
|
(22,542
|
)
|
|
$
|
150,866
|
|
|
$
|
150,866
|
|
|
For the Three Months
|
||||||
|
Ended March 31,
|
||||||
(In thousands)
|
2016
|
|
2015
|
||||
Investment income earned on:
|
|
|
|
||||
Fixed maturity securities, including cash and cash equivalents and loans receivable
|
$
|
108,835
|
|
|
$
|
108,129
|
|
Investment funds
|
16,636
|
|
|
6,061
|
|
||
Arbitrage trading account
|
3,190
|
|
|
8,979
|
|
||
Equity securities available for sale
|
868
|
|
|
1,180
|
|
||
Real estate
|
2,717
|
|
|
2,767
|
|
||
Gross investment income
|
132,246
|
|
|
127,116
|
|
||
Investment expense
|
(2,113
|
)
|
|
(2,877
|
)
|
||
Net investment income
|
$
|
130,133
|
|
|
$
|
124,239
|
|
|
Carrying Value as of
|
|
Income (Loss) from Investment Funds
|
||||||||||||
|
March 31,
|
|
December 31,
|
|
Three months ended March 31,
|
||||||||||
(In thousands)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Real estate
|
$
|
597,380
|
|
|
$
|
580,830
|
|
|
$
|
17,037
|
|
|
$
|
26,012
|
|
Energy
|
95,849
|
|
|
93,719
|
|
|
(3,924
|
)
|
|
(21,868
|
)
|
||||
Hedge equity
|
67,728
|
|
|
70,580
|
|
|
(2,852
|
)
|
|
(873
|
)
|
||||
Other funds
|
418,353
|
|
|
424,911
|
|
|
6,375
|
|
|
2,790
|
|
||||
Total
|
$
|
1,179,310
|
|
|
$
|
1,170,040
|
|
|
$
|
16,636
|
|
|
$
|
6,061
|
|
|
Carrying Value
|
||||||
|
March 31,
|
|
December 31,
|
||||
(In thousands)
|
2016
|
|
2015
|
||||
Properties in operation
|
$
|
239,476
|
|
|
$
|
226,055
|
|
Properties under development
|
747,334
|
|
|
710,312
|
|
||
Total
|
$
|
986,810
|
|
|
$
|
936,367
|
|
(In thousands)
|
March 31, 2016
|
|
December 31, 2015
|
||||
Amortized cost (net of valuation allowance):
|
|
|
|
||||
Real estate loans
|
$
|
121,861
|
|
|
$
|
200,499
|
|
Commercial loans
|
27,527
|
|
|
72,604
|
|
||
Total
|
$
|
149,388
|
|
|
$
|
273,103
|
|
|
|
|
|
||||
Fair value:
|
|
|
|
||||
Real estate loans
|
$
|
124,393
|
|
|
$
|
201,641
|
|
Commercial loans
|
27,527
|
|
|
74,106
|
|
||
Total
|
$
|
151,920
|
|
|
$
|
275,747
|
|
|
|
|
|
||||
Valuation allowance:
|
|
|
|
||||
Specific
|
$
|
555
|
|
|
$
|
—
|
|
General
|
2,107
|
|
|
2,094
|
|
||
Total
|
$
|
2,662
|
|
|
$
|
2,094
|
|
|
|
|
|
||||
|
2016
|
|
2015
|
||||
Increase (decrease) in valuation allowance
|
$
|
568
|
|
|
$
|
(47
|
)
|
|
|
|
|
|
For the Three Months Ended March 31,
|
||||||
(In thousands)
|
2016
|
|
2015
|
||||
Realized investment gains (losses):
|
|
|
|
|
|
||
Fixed maturity securities:
|
|
|
|
|
|
||
Gains
|
$
|
23,064
|
|
|
$
|
4,146
|
|
Losses
|
(2,940
|
)
|
|
(1,077
|
)
|
||
Equity securities available for sale
|
125
|
|
|
9,702
|
|
||
Investment funds
|
(460
|
)
|
|
(1,511
|
)
|
||
Real estate
|
5,024
|
|
|
—
|
|
||
Other
|
644
|
|
|
7,784
|
|
||
Net realized gains on investments sales
|
25,457
|
|
|
19,044
|
|
||
Other-than-temporary impairments (1)
|
(18,114
|
)
|
|
—
|
|
||
Net investment gains
|
7,343
|
|
|
19,044
|
|
||
Income tax expense
|
(2,570
|
)
|
|
(6,665
|
)
|
||
After-tax net realized investment gains
|
$
|
4,773
|
|
|
$
|
12,379
|
|
Change in unrealized investment gains and losses of available for sale securities:
|
|
|
|
|
|
||
Fixed maturity securities
|
$
|
92,428
|
|
|
$
|
42,480
|
|
Previously impaired fixed maturity securities
|
(55
|
)
|
|
8
|
|
||
Equity securities available for sale
|
13,137
|
|
|
(6,845
|
)
|
||
Investment funds
|
8,880
|
|
|
(11,107
|
)
|
||
Total change in unrealized investment gains (losses)
|
114,390
|
|
|
24,536
|
|
||
Income tax benefit (expense)
|
(37,535
|
)
|
|
(8,245
|
)
|
||
Noncontrolling interests
|
14
|
|
|
22
|
|
||
After-tax change in unrealized investment gains and losses of available for sale securities
|
$
|
76,869
|
|
|
$
|
16,313
|
|
|
Less Than 12 Months
|
|
12 Months or Greater
|
|
Total
|
||||||||||||||||||
(In thousands)
|
Fair Value
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
|
Gross
Unrealized
Losses
|
||||||||||||
March 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government and government agency
|
$
|
24,911
|
|
|
$
|
79
|
|
|
$
|
43,226
|
|
|
$
|
902
|
|
|
$
|
68,137
|
|
|
$
|
981
|
|
State and municipal
|
210,419
|
|
|
1,903
|
|
|
171,433
|
|
|
2,596
|
|
|
381,852
|
|
|
4,499
|
|
||||||
Mortgage-backed securities
|
135,022
|
|
|
1,748
|
|
|
155,445
|
|
|
4,416
|
|
|
290,467
|
|
|
6,164
|
|
||||||
Asset-backed securities
|
1,207,153
|
|
|
14,032
|
|
|
230,979
|
|
|
8,814
|
|
|
1,438,132
|
|
|
22,846
|
|
||||||
Corporate
|
362,296
|
|
|
25,162
|
|
|
79,582
|
|
|
10,998
|
|
|
441,878
|
|
|
36,160
|
|
||||||
Foreign
|
41,278
|
|
|
3,964
|
|
|
25,672
|
|
|
2,497
|
|
|
66,950
|
|
|
6,461
|
|
||||||
Fixed maturity securities
|
1,981,079
|
|
|
46,888
|
|
|
706,337
|
|
|
30,223
|
|
|
2,687,416
|
|
|
77,111
|
|
||||||
Common stocks
|
—
|
|
|
—
|
|
|
7,474
|
|
|
1,539
|
|
|
7,474
|
|
|
1,539
|
|
||||||
Preferred stocks
|
35,241
|
|
|
6,512
|
|
|
27,657
|
|
|
3,932
|
|
|
62,898
|
|
|
10,444
|
|
||||||
Equity securities available for sale
|
35,241
|
|
|
6,512
|
|
|
35,131
|
|
|
5,471
|
|
|
70,372
|
|
|
11,983
|
|
||||||
Total
|
$
|
2,016,320
|
|
|
$
|
53,400
|
|
|
$
|
741,468
|
|
|
$
|
35,694
|
|
|
$
|
2,757,788
|
|
|
$
|
89,094
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government and government agency
|
$
|
101,660
|
|
|
$
|
487
|
|
|
$
|
64,500
|
|
|
$
|
1,846
|
|
|
$
|
166,160
|
|
|
$
|
2,333
|
|
State and municipal
|
501,952
|
|
|
4,404
|
|
|
106,681
|
|
|
1,865
|
|
|
608,633
|
|
|
6,269
|
|
||||||
Mortgage-backed securities
|
381,986
|
|
|
3,639
|
|
|
184,807
|
|
|
7,669
|
|
|
566,793
|
|
|
11,308
|
|
||||||
Asset-backed securities
|
1,091,078
|
|
|
7,703
|
|
|
190,467
|
|
|
6,711
|
|
|
1,281,545
|
|
|
14,414
|
|
||||||
Corporate
|
1,232,940
|
|
|
35,406
|
|
|
76,797
|
|
|
8,987
|
|
|
1,309,737
|
|
|
44,393
|
|
||||||
Foreign
|
169,190
|
|
|
8,822
|
|
|
19,528
|
|
|
3,867
|
|
|
188,718
|
|
|
12,689
|
|
||||||
Fixed maturity securities
|
3,478,806
|
|
|
60,461
|
|
|
642,780
|
|
|
30,945
|
|
|
4,121,586
|
|
|
91,406
|
|
||||||
Common stocks
|
18,641
|
|
|
18,005
|
|
|
7,829
|
|
|
1,184
|
|
|
26,470
|
|
|
19,189
|
|
||||||
Preferred stocks
|
—
|
|
|
—
|
|
|
22,320
|
|
|
3,353
|
|
|
22,320
|
|
|
3,353
|
|
||||||
Equity securities available for sale
|
18,641
|
|
|
18,005
|
|
|
30,149
|
|
|
4,537
|
|
|
48,790
|
|
|
22,542
|
|
||||||
Total
|
$
|
3,497,447
|
|
|
$
|
78,466
|
|
|
$
|
672,929
|
|
|
$
|
35,482
|
|
|
$
|
4,170,376
|
|
|
$
|
113,948
|
|
($ in thousands)
|
Number of
Securities
|
|
Aggregate
Fair Value
|
|
Gross
Unrealized
Loss
|
|||||
Mortgage-backed securities
|
12
|
|
|
$
|
35,540
|
|
|
$
|
1,866
|
|
Asset-backed securities
|
7
|
|
|
26,322
|
|
|
261
|
|
||
Corporate
|
15
|
|
|
92,666
|
|
|
10,780
|
|
||
Foreign government
|
5
|
|
|
22,414
|
|
|
3,011
|
|
||
Total
|
39
|
|
|
$
|
176,942
|
|
|
$
|
15,918
|
|
(In thousands)
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
March 31, 2016
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities available for sale:
|
|
|
|
|
|
|
|
||||||||
U.S. government and government agency
|
$
|
597,951
|
|
|
$
|
—
|
|
|
$
|
597,951
|
|
|
$
|
—
|
|
State and municipal
|
4,584,768
|
|
|
—
|
|
|
4,584,768
|
|
|
—
|
|
||||
Mortgage-backed securities
|
1,155,149
|
|
|
—
|
|
|
1,155,149
|
|
|
—
|
|
||||
Asset-backed securities
|
1,844,404
|
|
|
—
|
|
|
1,844,207
|
|
|
197
|
|
||||
Corporate
|
3,568,576
|
|
|
—
|
|
|
3,568,576
|
|
|
—
|
|
||||
Foreign government
|
897,919
|
|
|
—
|
|
|
897,919
|
|
|
—
|
|
||||
Total fixed maturity securities available for sale
|
12,648,767
|
|
|
—
|
|
|
12,648,570
|
|
|
197
|
|
||||
Equity securities available for sale:
|
|
|
|
|
|
|
|
||||||||
Common stocks
|
37,571
|
|
|
30,097
|
|
|
—
|
|
|
7,474
|
|
||||
Preferred stocks
|
104,128
|
|
|
—
|
|
|
100,488
|
|
|
3,640
|
|
||||
Total equity securities available for sale
|
141,699
|
|
|
30,097
|
|
|
100,488
|
|
|
11,114
|
|
||||
Arbitrage trading account
|
384,519
|
|
|
244,647
|
|
|
139,742
|
|
|
130
|
|
||||
Total
|
$
|
13,174,985
|
|
|
$
|
274,744
|
|
|
$
|
12,888,800
|
|
|
$
|
11,441
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Trading account securities sold but not yet purchased
|
$
|
35,956
|
|
|
$
|
35,956
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2015
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities available for sale:
|
|
|
|
|
|
|
|
||||||||
U.S. government and government agency
|
$
|
670,419
|
|
|
$
|
—
|
|
|
$
|
670,419
|
|
|
$
|
—
|
|
State and municipal
|
4,460,179
|
|
|
—
|
|
|
4,460,179
|
|
|
—
|
|
||||
Mortgage-backed securities
|
1,199,859
|
|
|
—
|
|
|
1,199,859
|
|
|
—
|
|
||||
Asset-backed securities
|
1,705,172
|
|
|
—
|
|
|
1,704,973
|
|
|
199
|
|
||||
Corporate
|
3,475,038
|
|
|
—
|
|
|
3,474,884
|
|
|
154
|
|
||||
Foreign government
|
837,460
|
|
|
—
|
|
|
837,460
|
|
|
—
|
|
||||
Total fixed maturity securities available for sale
|
12,348,127
|
|
|
—
|
|
|
12,347,774
|
|
|
353
|
|
||||
Equity securities available for sale:
|
|
|
|
|
|
|
|
||||||||
Common stocks
|
37,273
|
|
|
29,444
|
|
|
—
|
|
|
7,829
|
|
||||
Preferred stocks
|
113,593
|
|
|
—
|
|
|
109,969
|
|
|
3,624
|
|
||||
Total equity securities available for sale
|
150,866
|
|
|
29,444
|
|
|
109,969
|
|
|
11,453
|
|
||||
Arbitrage trading account
|
376,697
|
|
|
256,914
|
|
|
119,607
|
|
|
176
|
|
||||
Total
|
$
|
12,875,690
|
|
|
$
|
286,358
|
|
|
$
|
12,577,350
|
|
|
$
|
11,982
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Trading account securities sold but not yet purchased
|
$
|
37,035
|
|
|
$
|
35,559
|
|
|
$
|
1,476
|
|
|
$
|
—
|
|
|
Gains (Losses) Included in:
|
||||||||||||||||||||||||||||||||||
(In thousands)
|
Beginning
Balance
|
|
Earnings (Losses)
|
|
Other
Comprehensive
Income (Loss)
|
|
Impairments
|
|
Purchases
|
|
(Sales)
|
|
Paydowns / Maturities
|
|
Transfers
|
|
Ending
Balance
|
||||||||||||||||||
In / (Out)
|
|||||||||||||||||||||||||||||||||||
Three months ended March 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Fixed maturities securities available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Asset-backed securities
|
$
|
199
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
$
|
197
|
|
Corporate
|
154
|
|
|
177
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(331
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Total
|
353
|
|
|
178
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
(331
|
)
|
|
(4
|
)
|
|
—
|
|
|
197
|
|
|||||||||
Equity securities available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Common stocks
|
7,829
|
|
|
—
|
|
|
(355
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,474
|
|
|||||||||
Preferred stocks
|
3,624
|
|
|
16
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,640
|
|
|||||||||
Total
|
11,453
|
|
|
16
|
|
|
(355
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,114
|
|
|||||||||
Arbitrage trading account
|
176
|
|
|
(46
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
130
|
|
|||||||||
Total
|
$
|
11,982
|
|
|
$
|
148
|
|
|
$
|
(354
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(331
|
)
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
$
|
11,441
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Year ended December 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Fixed maturities securities available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Asset-backed securities
|
$
|
20,611
|
|
|
$
|
19
|
|
|
$
|
191
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1,820
|
)
|
|
$
|
(18,802
|
)
|
|
$
|
199
|
|
Corporate
|
154
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
154
|
|
|||||||||
Total
|
20,765
|
|
|
19
|
|
|
191
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,820
|
)
|
|
(18,802
|
)
|
|
353
|
|
|||||||||
Equity securities available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Common stocks
|
10,741
|
|
|
—
|
|
|
(273
|
)
|
|
(2,331
|
)
|
|
—
|
|
|
(308
|
)
|
|
—
|
|
|
—
|
|
|
7,829
|
|
|||||||||
Preferred stocks
|
3,713
|
|
|
(89
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,624
|
|
|||||||||
Total
|
14,454
|
|
|
(89
|
)
|
|
(273
|
)
|
|
(2,331
|
)
|
|
—
|
|
|
(308
|
)
|
|
—
|
|
|
—
|
|
|
11,453
|
|
|||||||||
Arbitrage trading account
|
720
|
|
|
(799
|
)
|
|
—
|
|
|
—
|
|
|
72,640
|
|
|
(71,921
|
)
|
|
—
|
|
|
(464
|
)
|
|
176
|
|
|||||||||
Total
|
$
|
35,939
|
|
|
$
|
(869
|
)
|
|
$
|
(82
|
)
|
|
$
|
(2,331
|
)
|
|
$
|
72,640
|
|
|
$
|
(72,229
|
)
|
|
$
|
(1,820
|
)
|
|
$
|
(19,266
|
)
|
|
$
|
11,982
|
|
|
March 31, 2016
|
|
December 31, 2015
|
||||||||||||
(In thousands)
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities
|
$
|
12,745,436
|
|
|
$
|
12,765,246
|
|
|
$
|
12,444,394
|
|
|
$
|
12,462,847
|
|
Equity securities available for sale
|
141,699
|
|
|
141,699
|
|
|
150,866
|
|
|
150,866
|
|
||||
Arbitrage trading account
|
384,519
|
|
|
384,519
|
|
|
376,697
|
|
|
376,697
|
|
||||
Loans receivable
|
149,388
|
|
|
151,920
|
|
|
273,103
|
|
|
275,747
|
|
||||
Cash and cash equivalents
|
837,515
|
|
|
837,515
|
|
|
763,631
|
|
|
763,631
|
|
||||
Trading account receivables from brokers and clearing organizations
|
373,833
|
|
|
373,833
|
|
|
383,115
|
|
|
383,115
|
|
||||
Due from broker
|
—
|
|
|
—
|
|
|
1,713
|
|
|
1,713
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Due to broker
|
71,024
|
|
|
71,024
|
|
|
—
|
|
|
—
|
|
||||
Trading account securities sold but not yet purchased
|
35,956
|
|
|
35,956
|
|
|
37,035
|
|
|
37,035
|
|
||||
Subordinated debentures
|
446,485
|
|
|
462,256
|
|
|
340,320
|
|
|
355,880
|
|
||||
Senior notes and other debt
|
1,814,998
|
|
|
2,018,282
|
|
|
1,844,621
|
|
|
2,029,572
|
|
|
For the Three Months
|
||||||
|
Ended March 31,
|
||||||
(In thousands)
|
2016
|
|
2015
|
||||
Written premiums:
|
|
|
|
||||
Direct
|
$
|
1,709,129
|
|
|
$
|
1,647,341
|
|
Assumed
|
246,568
|
|
|
204,464
|
|
||
Ceded
|
(291,975
|
)
|
|
(276,403
|
)
|
||
Total net premiums written
|
$
|
1,663,722
|
|
|
$
|
1,575,402
|
|
|
|
|
|
||||
Earned premiums:
|
|
|
|
||||
Direct
|
$
|
1,568,067
|
|
|
$
|
1,524,736
|
|
Assumed
|
218,367
|
|
|
203,342
|
|
||
Ceded
|
(259,099
|
)
|
|
(256,065
|
)
|
||
Total net premiums earned
|
$
|
1,527,335
|
|
|
$
|
1,472,013
|
|
|
|
|
|
||||
Ceded losses and loss expenses incurred
|
$
|
126,929
|
|
|
$
|
118,391
|
|
Ceded commissions earned
|
$
|
47,973
|
|
|
$
|
43,651
|
|
($ in thousands)
|
Units
|
|
Fair Value
|
|||
Three months ended March 31,
|
|
|
|
|||
2016
|
5,580
|
|
|
$
|
286
|
|
2015
|
10,000
|
|
|
$
|
503
|
|
•
|
Insurance
- primarily commercial insurance business, including excess and surplus lines and admitted lines in the United States, United Kingdom, Continental Europe, South America, Canada, Scandinavia, Asia and Australia; and
|
•
|
Reinsurance
- reinsurance business on a facultative and treaty basis, primarily in the United States, United Kingdom, Continental Europe, Australia, the Asia-Pacific Region, and South Africa.
|
|
Revenues
|
|
|
|
|
||||||||||||||||||
(In thousands)
|
Earned
Premiums
|
|
Investment
Income
|
|
Other
|
|
Total
|
|
Pre-Tax
Income
(Loss)
|
|
Net Income
(Loss) to Common Stockholders
|
||||||||||||
Three months ended March 31, 2016:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Insurance
|
$
|
1,375,358
|
|
|
$
|
105,229
|
|
|
$
|
26,793
|
|
|
$
|
1,507,380
|
|
|
$
|
205,915
|
|
|
$
|
139,270
|
|
Reinsurance
|
151,977
|
|
|
18,401
|
|
|
—
|
|
|
170,378
|
|
|
21,797
|
|
|
15,117
|
|
||||||
Corporate, other and eliminations (1)
|
—
|
|
|
6,503
|
|
|
115,607
|
|
|
122,110
|
|
|
(60,379
|
)
|
|
(39,649
|
)
|
||||||
Net investment gains
|
—
|
|
|
—
|
|
|
7,343
|
|
|
7,343
|
|
|
7,343
|
|
|
4,773
|
|
||||||
Consolidated
|
$
|
1,527,335
|
|
|
$
|
130,133
|
|
|
$
|
149,743
|
|
|
$
|
1,807,211
|
|
|
$
|
174,676
|
|
|
$
|
119,511
|
|
Three months ended March 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Insurance
|
$
|
1,311,276
|
|
|
$
|
99,084
|
|
|
$
|
25,575
|
|
|
$
|
1,435,935
|
|
|
$
|
188,169
|
|
|
$
|
130,039
|
|
Reinsurance
|
160,737
|
|
|
17,041
|
|
|
—
|
|
|
177,778
|
|
|
20,262
|
|
|
14,500
|
|
||||||
Corporate, other and eliminations (1)
|
—
|
|
|
8,114
|
|
|
103,808
|
|
|
111,922
|
|
|
(58,758
|
)
|
|
(38,611
|
)
|
||||||
Net investment gains
|
—
|
|
|
—
|
|
|
19,044
|
|
|
19,044
|
|
|
19,044
|
|
|
12,379
|
|
||||||
Consolidated
|
$
|
1,472,013
|
|
|
$
|
124,239
|
|
|
$
|
148,427
|
|
|
$
|
1,744,679
|
|
|
$
|
168,717
|
|
|
$
|
118,307
|
|
Twelve months ended December 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Insurance
|
$
|
5,431,500
|
|
|
$
|
410,457
|
|
|
$
|
96,487
|
|
|
$
|
5,938,444
|
|
|
$
|
776,593
|
|
|
$
|
532,286
|
|
Reinsurance
|
609,109
|
|
|
74,226
|
|
|
—
|
|
|
683,335
|
|
|
94,852
|
|
|
66,627
|
|
||||||
Corporate, other and eliminations (1)
|
—
|
|
|
27,962
|
|
|
464,392
|
|
|
492,354
|
|
|
(231,739
|
)
|
|
(155,230
|
)
|
||||||
Net investment gains
|
—
|
|
|
—
|
|
|
92,324
|
|
|
92,324
|
|
|
92,324
|
|
|
60,011
|
|
||||||
Consolidated
|
$
|
6,040,609
|
|
|
$
|
512,645
|
|
|
$
|
653,203
|
|
|
$
|
7,206,457
|
|
|
$
|
732,030
|
|
|
$
|
503,694
|
|
Twelve months ended December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Insurance
|
$
|
5,074,308
|
|
|
$
|
484,039
|
|
|
$
|
106,853
|
|
|
$
|
5,665,200
|
|
|
$
|
826,088
|
|
|
$
|
561,643
|
|
Reinsurance
|
670,110
|
|
|
88,821
|
|
|
—
|
|
|
758,931
|
|
|
115,677
|
|
|
79,720
|
|
||||||
Corporate, other and eliminations (1)
|
—
|
|
|
28,025
|
|
|
421,920
|
|
|
449,945
|
|
|
(244,421
|
)
|
|
(158,133
|
)
|
||||||
Net investment gains
|
—
|
|
|
—
|
|
|
254,852
|
|
|
254,852
|
|
|
254,852
|
|
|
165,654
|
|
||||||
Consolidated
|
$
|
5,744,418
|
|
|
$
|
600,885
|
|
|
$
|
783,625
|
|
|
$
|
7,128,928
|
|
|
$
|
952,196
|
|
|
$
|
648,884
|
|
Twelve months ended December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Insurance
|
$
|
4,505,567
|
|
|
$
|
451,319
|
|
|
$
|
107,517
|
|
|
$
|
5,064,403
|
|
|
$
|
705,662
|
|
|
$
|
490,273
|
|
Reinsurance
|
720,970
|
|
|
89,090
|
|
|
—
|
|
|
810,060
|
|
|
110,425
|
|
|
78,013
|
|
||||||
Corporate, other and eliminations (1)
|
—
|
|
|
3,882
|
|
|
408,645
|
|
|
412,527
|
|
|
(238,743
|
)
|
|
(142,479
|
)
|
||||||
Net investment gains
|
—
|
|
|
—
|
|
|
121,544
|
|
|
121,544
|
|
|
121,544
|
|
|
74,118
|
|
||||||
Consolidated
|
$
|
5,226,537
|
|
|
$
|
544,291
|
|
|
$
|
637,706
|
|
|
$
|
6,408,534
|
|
|
$
|
698,888
|
|
|
$
|
499,925
|
|
(In thousands)
|
March 31, 2016
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||
Insurance
|
$
|
18,232,365
|
|
|
$
|
18,063,730
|
|
|
$
|
17,944,847
|
|
Reinsurance
|
2,595,231
|
|
|
2,441,340
|
|
|
2,713,554
|
|
|||
Corporate, other and eliminations
|
1,403,338
|
|
|
1,219,086
|
|
|
1,058,290
|
|
|||
Consolidated
|
$
|
22,230,934
|
|
|
$
|
21,724,156
|
|
|
$
|
21,716,691
|
|
|
For the Three Months
|
||||||
|
Ended March 31,
|
||||||
(In thousands)
|
2016
|
|
2015
|
||||
Insurance:
|
|
|
|
||||
Other liability
|
$
|
422,956
|
|
|
$
|
396,904
|
|
Workers’ compensation
|
345,503
|
|
|
314,738
|
|
||
Short-tail lines
|
331,857
|
|
|
323,090
|
|
||
Commercial automobile
|
156,817
|
|
|
165,560
|
|
||
Professional liability
|
118,225
|
|
|
110,984
|
|
||
Total Insurance
|
1,375,358
|
|
|
1,311,276
|
|
||
|
|
|
|
||||
Reinsurance:
|
|
|
|
||||
Casualty
|
100,334
|
|
|
112,816
|
|
||
Property
|
51,643
|
|
|
47,921
|
|
||
Total Reinsurance
|
151,977
|
|
|
160,737
|
|
||
|
|
|
|
||||
Total
|
$
|
1,527,335
|
|
|
$
|
1,472,013
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
(In thousands)
|
March 31, 2016
|
|
December 31, 2015
|
||||
Insurance
|
$
|
7,937,268
|
|
|
$
|
7,876,193
|
|
Reinsurance
|
1,435,168
|
|
|
1,368,679
|
|
||
Net reserves for losses and loss expenses
|
9,372,436
|
|
|
9,244,872
|
|
||
Ceded reserves for losses and loss expenses
|
1,415,906
|
|
|
1,424,278
|
|
||
Gross reserves for losses and loss expenses
|
$
|
10,788,342
|
|
|
$
|
10,669,150
|
|
(In thousands)
|
Reported Case
Reserves
|
|
Incurred But
Not Reported
|
|
Total
|
||||||
March 31, 2016
|
|
|
|
|
|
||||||
Other liability
|
$
|
1,107,501
|
|
|
$
|
1,946,085
|
|
|
$
|
3,053,586
|
|
Workers’ compensation (1)
|
1,610,777
|
|
|
1,301,373
|
|
|
2,912,150
|
|
|||
Professional liability
|
250,468
|
|
|
475,044
|
|
|
725,512
|
|
|||
Commercial automobile
|
361,386
|
|
|
253,886
|
|
|
615,272
|
|
|||
Short-tail lines (2)
|
334,239
|
|
|
296,509
|
|
|
630,748
|
|
|||
Total Insurance
|
3,664,371
|
|
|
4,272,897
|
|
|
7,937,268
|
|
|||
Reinsurance (1)
|
677,120
|
|
|
758,048
|
|
|
1,435,168
|
|
|||
Total
|
$
|
4,341,491
|
|
|
$
|
5,030,945
|
|
|
$
|
9,372,436
|
|
|
|
|
|
|
|
||||||
December 31, 2015
|
|
|
|
|
|
||||||
Other liability
|
$
|
1,079,641
|
|
|
$
|
1,947,637
|
|
|
$
|
3,027,278
|
|
Workers’ compensation (1)
|
1,655,726
|
|
|
1,263,508
|
|
|
2,919,234
|
|
|||
Professional liability
|
256,783
|
|
|
478,796
|
|
|
735,579
|
|
|||
Commercial automobile
|
352,208
|
|
|
242,071
|
|
|
594,279
|
|
|||
Short-tail lines (2)
|
317,375
|
|
|
282,448
|
|
|
599,823
|
|
|||
Total Insurance
|
3,661,733
|
|
|
4,214,460
|
|
|
7,876,193
|
|
|||
Reinsurance (1)
|
631,666
|
|
|
737,013
|
|
|
1,368,679
|
|
|||
Total
|
$
|
4,293,399
|
|
|
$
|
4,951,473
|
|
|
$
|
9,244,872
|
|
(In thousands)
|
2016
|
|
2015
|
||||
Net decrease in prior year loss reserves
|
$
|
5,601
|
|
|
$
|
2,499
|
|
Increase in prior year earned premiums
|
6,687
|
|
|
9,304
|
|
||
Net favorable prior year development
|
$
|
12,288
|
|
|
$
|
11,803
|
|
($ in thousands)
|
Number of
Securities
|
|
Aggregate
Fair Value
|
|
Unrealized
Loss
|
|||||
Unrealized loss less than 20% of amortized cost
|
351
|
|
|
$
|
2,631,606
|
|
|
$
|
55,136
|
|
Unrealized loss of 20% or greater of amortized cost:
|
|
|
|
|
|
|||||
Less than twelve months
|
4
|
|
|
14,143
|
|
|
7,584
|
|
||
Twelve months and longer
|
5
|
|
|
41,667
|
|
|
14,391
|
|
||
Total
|
360
|
|
|
$
|
2,687,416
|
|
|
$
|
77,111
|
|
($ in thousands)
|
Number of
Securities
|
|
Aggregate
Fair Value
|
|
Unrealized
Loss
|
|||||
Mortgage-backed securities
|
12
|
|
|
$
|
35,540
|
|
|
$
|
1,866
|
|
Asset-backed securities
|
7
|
|
|
26,322
|
|
|
261
|
|
||
Corporate
|
15
|
|
|
92,666
|
|
|
10,780
|
|
||
Foreign government
|
5
|
|
|
22,414
|
|
|
3,011
|
|
||
Total
|
39
|
|
|
$
|
176,942
|
|
|
$
|
15,918
|
|
($ in thousands)
|
Carrying
Value
|
|
Percent
of Total
|
|||
Pricing source:
|
|
|
|
|||
Independent pricing services
|
$
|
12,403,307
|
|
|
98.1
|
%
|
Syndicate manager
|
65,588
|
|
|
0.5
|
|
|
Directly by the Company based on:
|
|
|
|
|||
Observable data
|
179,675
|
|
|
1.4
|
|
|
Cash flow model
|
197
|
|
|
—
|
|
|
Total
|
$
|
12,648,767
|
|
|
100.0
|
|
($ in thousands)
|
2016
|
|
2015
|
||||
Insurance:
|
|
|
|
||||
Gross premiums written
|
$
|
1,763,070
|
|
|
$
|
1,692,403
|
|
Net premiums written
|
1,488,737
|
|
|
1,425,139
|
|
||
Net premiums earned
|
1,375,358
|
|
|
1,311,276
|
|
||
Loss ratio
|
60.5
|
%
|
|
61.1
|
%
|
||
Expense ratio
|
32.5
|
%
|
|
32.4
|
%
|
||
GAAP combined ratio
|
93.0
|
%
|
|
93.5
|
%
|
||
Reinsurance:
|
|
|
|
||||
Gross premiums written
|
$
|
192,627
|
|
|
$
|
159,402
|
|
Net premiums written
|
174,985
|
|
|
150,263
|
|
||
Net premiums earned
|
151,977
|
|
|
160,737
|
|
||
Loss ratio
|
59.6
|
%
|
|
62.2
|
%
|
||
Expense ratio
|
38.2
|
%
|
|
35.8
|
%
|
||
GAAP combined ratio
|
97.8
|
%
|
|
98.0
|
%
|
||
Consolidated:
|
|
|
|
||||
Gross premiums written
|
$
|
1,955,697
|
|
|
$
|
1,851,805
|
|
Net premiums written
|
1,663,722
|
|
|
1,575,402
|
|
||
Net premiums earned
|
1,527,335
|
|
|
1,472,013
|
|
||
Loss ratio
|
60.4
|
%
|
|
61.2
|
%
|
||
Expense ratio
|
33.1
|
%
|
|
32.7
|
%
|
||
GAAP combined ratio
|
93.5
|
%
|
|
93.9
|
%
|
(In thousands, except per share data)
|
2016
|
|
2015
|
||||
Net income to common stockholders
|
$
|
119,511
|
|
|
$
|
118,307
|
|
Weighted average diluted shares
|
128,529
|
|
|
132,484
|
|
||
Net income per diluted share
|
$
|
0.93
|
|
|
$
|
0.89
|
|
•
|
Insurance - gross premiums increased 4% to $1,763 million in 2016 from $1,692 million in 2015. Gross premiums increased $49 million (10%) for other liability, $32 million (7%) for workers' compensation and $11 million (8%) for professional liability, and decreased $11 million (3%) for short-tail lines and $10 million (6%) for commercial auto.
|
•
|
Reinsurance - gross premiums increased 21% to $193 million in 2016 from $159 million in 2015. Gross premiums increased $39 million (82%) for property lines and decreased $5 million (5%) for casualty lines. The increase in property premiums was primarily due to growth in structured property reinsurance.
|
|
Amount
|
|
Average Annualized
Yield
|
||||||||||
($ In thousands)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||
Fixed maturity securities, including cash and cash equivalents and loans receivable
|
$
|
108,835
|
|
|
$
|
108,129
|
|
|
3.2
|
%
|
|
3.3
|
%
|
Investment funds
|
16,636
|
|
|
6,061
|
|
|
5.5
|
|
|
2.0
|
|
||
Arbitrage trading account
|
3,190
|
|
|
8,979
|
|
|
3.7
|
|
|
6.8
|
|
||
Real estate
|
2,717
|
|
|
2,767
|
|
|
1.1
|
|
|
1.5
|
|
||
Equity securities available for sale
|
868
|
|
|
1,180
|
|
|
2.2
|
|
|
2.9
|
|
||
Gross investment income
|
132,246
|
|
|
127,116
|
|
|
3.3
|
|
|
3.2
|
|
||
Investment expenses
|
(2,113
|
)
|
|
(2,877
|
)
|
|
|
|
|
||||
Total
|
$
|
130,133
|
|
|
$
|
124,239
|
|
|
3.2
|
%
|
|
3.1
|
%
|
•
|
Insurance - The loss ratio of 60.5% in 2016 was 0.6 points lower than the loss ratio of 61.1% in 2015. Catastrophe losses were $15 million in 2016 compared with $14 million in 2015. Favorable prior year reserve development was $12 million in both 2016 and 2015. The loss ratio excluding catastrophe losses and prior year reserve development decreased 0.7 points to 60.2% in 2016 from 60.9% in 2015.
|
•
|
Reinsurance - The loss ratio of 59.6% in 2016 was 2.6 points lower than the loss ratio of 62.2% in 2015. Catastrophe losses were $0.5 million in 2016 compared with none in 2015. Favorable prior year reserve development was $0.7 million in 2016 compared with $0.2 million in 2015. The loss ratio excluding catastrophe losses and prior year reserve development decreased 2.6 points to 59.7% in 2016 from 62.3% in 2015.
|
(In thousands)
|
2016
|
|
2015
|
||||
Underwriting expenses
|
$
|
505,255
|
|
|
$
|
482,060
|
|
Service expenses
|
33,798
|
|
|
31,084
|
|
||
Net foreign currency losses (gains)
|
3,728
|
|
|
(567
|
)
|
||
Other costs and expenses
|
39,678
|
|
|
38,469
|
|
||
Total
|
$
|
582,459
|
|
|
$
|
551,046
|
|
($ in thousands)
|
Carrying
Value
|
|
Percent
of Total
|
|||
Fixed maturity securities:
|
|
|
|
|||
U.S. government and government agencies
|
$
|
597,951
|
|
|
3.6
|
%
|
State and municipal:
|
|
|
|
|||
Special revenue
|
2,754,797
|
|
|
16.8
|
|
|
State general obligation
|
657,062
|
|
|
4.0
|
|
|
Pre-refunded (1)
|
441,106
|
|
|
2.7
|
|
|
Local general obligation
|
407,243
|
|
|
2.5
|
|
|
Corporate backed
|
402,824
|
|
|
2.5
|
|
|
Total state and municipal
|
4,663,032
|
|
|
28.5
|
|
|
Mortgage-backed securities:
|
|
|
|
|||
Agency
|
832,541
|
|
|
5.1
|
|
|
Residential-Prime
|
227,355
|
|
|
1.4
|
|
|
Commercial
|
65,300
|
|
|
0.4
|
|
|
Residential-Alt A
|
48,358
|
|
|
0.3
|
|
|
Total mortgage-backed securities
|
1,173,554
|
|
|
7.2
|
|
|
Asset-backed securities
|
1,844,404
|
|
|
11.2
|
|
|
Corporate:
|
|
|
|
|||
Industrial
|
2,093,572
|
|
|
12.7
|
|
|
Financial
|
1,202,140
|
|
|
7.3
|
|
|
Utilities
|
206,149
|
|
|
1.3
|
|
|
Other
|
66,715
|
|
|
0.4
|
|
|
Total corporate
|
3,568,576
|
|
|
21.7
|
|
|
Foreign government and foreign government agencies
|
897,919
|
|
|
5.5
|
|
|
Total fixed maturity securities
|
12,745,436
|
|
|
77.7
|
|
|
Equity securities available for sale:
|
|
|
|
|||
Preferred stocks
|
104,128
|
|
|
0.6
|
|
|
Common stocks
|
37,571
|
|
|
0.2
|
|
|
Total equity securities available for sale
|
141,699
|
|
|
0.8
|
|
|
Investment funds
|
1,179,310
|
|
|
7.2
|
|
|
Real estate
|
986,810
|
|
|
6.0
|
|
|
Cash and cash equivalents
|
837,515
|
|
|
5.1
|
|
|
Arbitrage trading account
|
384,519
|
|
|
2.3
|
|
|
Loans receivable
|
149,388
|
|
|
0.9
|
|
|
Total investments
|
$
|
16,424,677
|
|
|
100.0
|
%
|
(In thousands)
|
Carrying Value
|
||
Australia
|
$
|
250,641
|
|
Argentina
|
161,778
|
|
|
Canada
|
158,180
|
|
|
United Kingdom
|
157,261
|
|
|
Germany
|
52,226
|
|
|
Supranational (1)
|
36,421
|
|
|
Norway
|
33,904
|
|
|
Brazil
|
31,388
|
|
|
Singapore
|
6,483
|
|
|
Colombia
|
5,798
|
|
|
Uruguay
|
3,839
|
|
|
Total
|
$
|
897,919
|
|
Item 3.
|
Quantitative and Qualitative Disclosure About Market Risk
|
Item 4.
|
Controls and Procedures
|
|
Total number
of shares
purchased
|
|
Average price
paid per share
|
|
Total number of shares purchased
as part of publicly announced
plans
or programs
|
|
Maximum number of
shares that may yet be
purchased under the
plans or programs
|
|||||
January
|
299,831
|
|
|
$
|
52.52
|
|
|
299,831
|
|
|
8,947,147
|
|
February
|
434,224
|
|
|
$
|
49.92
|
|
|
434,224
|
|
|
8,512,923
|
|
March
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
8,512,923
|
|
|
|
|
|
|
|
|
|
Number
|
|
|
|
|
|
(10.1)
|
|
Form of 2016 Performance Unit Award Agreement under the W. R. Berkley Corporation 2014 Long-Term Incentive Plan.
|
|
|
|
(31.1)
|
|
Certification of the Chief Executive Officer pursuant to Rule 13a-14(a)/ 15d-14(a).
|
|
|
|
(31.2)
|
|
Certification of the Chief Financial Officer pursuant to Rule 13a-14(a)/ 15d-14(a).
|
|
|
|
(32.1)
|
|
Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
W. R. BERKLEY CORPORATION
|
Date:
|
May 10, 2016
|
/s/ W. Robert Berkley, Jr.
|
|
|
W. Robert Berkley, Jr.
|
|
|
President and Chief Executive Officer
|
|
|
|
Date:
|
May 10, 2016
|
/s/ Eugene G. Ballard
|
|
|
Eugene G. Ballard
|
|
|
Executive Vice President - Chief Financial Officer
|
W. R. Berkley Corporation
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
|
|
|
Participant
|
|
|
Name
|
|
/s/ W. Robert Berkley, Jr.
|
|
W. Robert Berkley, Jr.
|
|
President and
Chief Executive Officer
|
|
/s/ Eugene G. Ballard
|
|
Eugene G. Ballard
|
|
Executive Vice President -
Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ W. Robert Berkley, Jr.
|
W. Robert Berkley, Jr.
|
President and Chief Executive Officer
|
|
/s/ Eugene G. Ballard
|
Eugene G. Ballard
|
Executive Vice President — Chief Financial Officer
|