Large accelerated filer
x
|
|
Accelerated filer
o
|
|
Non-accelerated filer
o
|
Smaller reporting company
o
|
|
Emerging growth company
o
|
|
|
•
|
Underwriting - our underwriting operations are comprised of our risk-bearing insurance and reinsurance operations
|
•
|
Investing - our investing activities are primarily related to our underwriting operations
|
•
|
Markel Ventures - our Markel Ventures operations include our controlling interests in a diverse portfolio of businesses that operate outside of the specialty insurance marketplace
|
•
|
Investment management - our investment management operations include investment fund managers that offer a variety of investment products, including insurance-linked securities, catastrophe bonds, insurance swaps and weather derivatives
|
•
|
Program services - our program services business serves as a fronting platform that provides other insurance companies access to the United States (U.S.) property and casualty insurance market
|
(1)
Market Segment Report - U.S. Surplus Lines
, A.M. Best
(September 14, 2018)
.
|
(2)
London Company Market Statistics Report
, International Underwriting Association
(October 2018)
.
|
(3)
sigma
, Swiss Re Institute (March 2018).
|
(4)
Market Segment Report - Global Reinsurance
, A.M. Best
(September 4, 2018)
.
|
(5)
Lloyd's Annual Report 2017.
|
(1)
Bermuda Monetary Authority 2017 Annual Report.
|
(2)
Market Segment Report - Global Reinsurance,
A.M. Best
(September 4, 2018)
.
|
•
|
General Liability
|
•
|
Professional Liability
|
•
|
Property
|
•
|
Personal Lines
|
•
|
Marine and Energy
|
•
|
Specialty Programs
|
•
|
Workers' Compensation
|
•
|
Other Product Lines
|
•
|
excess and umbrella products, which provide coverage over approved underlying insurance carriers on either an occurrence or claims-made basis;
|
•
|
products liability products, which provide coverage on either an occurrence or claims-made basis to manufacturers, distributors, importers and re-packagers of manufactured products;
|
•
|
environmental products, which provide coverage on either an occurrence or claims-made basis and include environmental consultants' professional liability, contractors' pollution liability and site-specific environmental impairment liability coverages; and
|
•
|
casualty facultative reinsurance written for individual casualty risks focusing on general liability, products liability, automobile liability and certain classes of miscellaneous professional liability and targeting classes which include low frequency, high severity general liability risks.
|
•
|
inland marine products, which provide a number of specialty coverages for risks such as motor truck cargo coverage for damage to third party cargo while in transit, warehouseman's legal liability coverage for damage to third party goods in storage, contractor's equipment coverage for first party property damage and builder's risk coverage;
|
•
|
railroad-related products, which provide first party coverages for short-line and regional railroads, scenic and tourist railroads, commuter and light rail trains and railroad equipment; and
|
•
|
specie coverage for fine art on exhibition and in private collections, securities, bullion, precious metals, cash in transit and jewelry.
|
•
|
general agent programs that use managing general agents to offer single source admitted and non-admitted programs for a specific class or line of business;
|
•
|
first and third party coverages for medical transport, small fishing ventures, charters, utility boats and boat rentals; and
|
•
|
property and liability coverages for small to medium-sized commercial risks, including farms, zoos, animal theme parks, safari parks and animal boarding, breeding and training facilities.
|
•
|
surety products, which consist primarily of contract, commercial and court bonds;
|
•
|
CPI, which provides coverage on automobiles or other vehicles held as collateral for loans made by credit unions, banks and specialty finance companies;
|
•
|
coverages for equine-related risks, such as horse mortality, theft, infertility, transit and specified perils;
|
•
|
crime coverage primarily targeting financial institutions and providing protection for bankers' blanket bond, computer crime and commercial fidelity;
|
•
|
small business owners policies providing property and liability package coverage to small and medium sized businesses;
|
•
|
accident and health coverage targeting affinity groups and schemes, high value and high risks accounts and sports groups;
|
•
|
coverage for legal expenses including before the event products that protect commercial clients in the event of legal actions and after the event products covering a wide range of litigation; and
|
•
|
short-term trade credit coverage for commercial risks, including insolvency and protracted default as well as political risks coverage in conjunction with commercial risks for currency inconvertibility, government action, import and export license cancellation, public buyer default and war.
|
•
|
Casualty
|
•
|
Property
|
•
|
Specialty
|
|
Years Ended December 31,
|
||||||||||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Net investment income
|
$
|
434,215
|
|
|
$
|
405,709
|
|
|
$
|
373,230
|
|
|
$
|
353,213
|
|
|
$
|
363,230
|
|
Net investment gains (losses)
(1)
|
$
|
(437,596
|
)
|
|
$
|
(5,303
|
)
|
|
$
|
65,147
|
|
|
$
|
106,480
|
|
|
$
|
46,000
|
|
Change in net unrealized investment gains on available-for-sale securities
|
$
|
(299,446
|
)
|
|
$
|
1,125,440
|
|
|
$
|
342,111
|
|
|
$
|
(457,584
|
)
|
|
$
|
981,035
|
|
Investment yield
(2)
|
2.7
|
%
|
|
2.6
|
%
|
|
2.4
|
%
|
|
2.3
|
%
|
|
2.4
|
%
|
(1)
|
Effective January 1, 2018, we adopted ASU No. 2016-01. As a result, equity securities are no longer classified as available-for-sale with unrealized gains and losses recognized in other comprehensive income; rather, all changes in the fair value of equity securities are now recognized in net income. Prior periods have not been restated to conform to the current presentation. See note
1
of the notes to consolidated financial statements.
|
(2)
|
Investment yield reflects net investment income as a percentage of monthly average invested assets at amortized cost.
|
|
|
|
|
|
|
|
|
|
|
|
Five-Year
Annual
Return
|
|
Ten-Year
Annual
Return
|
||||||||||||
|
Years Ended December 31,
|
|
|
||||||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
|
||||||||||||||
Equities
|
(3.5
|
)%
|
|
25.5
|
%
|
|
13.5
|
%
|
|
(2.5
|
)%
|
|
18.6
|
%
|
|
9.7
|
%
|
|
14.9
|
%
|
|||||
Fixed maturities
(1)
|
1.3
|
%
|
|
3.4
|
%
|
|
2.4
|
%
|
|
1.6
|
%
|
|
6.5
|
%
|
|
3.0
|
%
|
|
4.3
|
%
|
|||||
Total portfolio, before foreign currency effect
|
(0.7
|
)%
|
|
9.2
|
%
|
|
5.0
|
%
|
|
0.5
|
%
|
|
8.9
|
%
|
|
4.5
|
%
|
|
6.4
|
%
|
|||||
Total portfolio
|
(1.0
|
)%
|
|
10.2
|
%
|
|
4.4
|
%
|
|
(0.7
|
)%
|
|
7.4
|
%
|
|
3.9
|
%
|
|
6.3
|
%
|
|||||
Invested assets, end of year (in millions)
|
$
|
19,238
|
|
|
$
|
20,570
|
|
|
$
|
19,059
|
|
|
$
|
18,181
|
|
|
$
|
18,638
|
|
|
|
|
|
(1)
|
Includes short-term investments, cash and cash equivalents and restricted cash and cash equivalents.
|
|
Years Ended December 31,
|
|||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|||||
Investment yield
(1)
|
2.7
|
%
|
|
2.6
|
%
|
|
2.4
|
%
|
|
2.3
|
%
|
|
2.4
|
%
|
Adjustment of investment yield from amortized cost to fair value
|
(0.6
|
)%
|
|
(0.5
|
)%
|
|
(0.4
|
)%
|
|
(0.4
|
)%
|
|
(0.4
|
)%
|
Net amortization of net premium on fixed maturities
|
0.4
|
%
|
|
0.4
|
%
|
|
0.4
|
%
|
|
0.5
|
%
|
|
0.6
|
%
|
Net investment gains (losses) and change in net unrealized investment gains on available-for-sale securities
|
(3.4
|
)%
|
|
5.9
|
%
|
|
2.3
|
%
|
|
(2.0
|
)%
|
|
5.9
|
%
|
Taxable equivalent effect for interest and dividends
(2)
|
0.1
|
%
|
|
0.4
|
%
|
|
0.4
|
%
|
|
0.4
|
%
|
|
0.4
|
%
|
Other
(3)
|
(0.2
|
)%
|
|
1.4
|
%
|
|
(0.7
|
)%
|
|
(1.5
|
)%
|
|
(1.5
|
)%
|
Taxable equivalent total investment return
|
(1.0
|
)%
|
|
10.2
|
%
|
|
4.4
|
%
|
|
(0.7
|
)%
|
|
7.4
|
%
|
(1)
|
Investment yield reflects net investment income as a percentage of monthly average invested assets at amortized cost.
|
(2)
|
Adjustment to tax-exempt interest and dividend income to reflect a taxable equivalent basis.
|
(3)
|
Adjustment to reflect the impact of changes in foreign currency exchange rates and time-weighting the inputs to the calculation of taxable equivalent total investment return.
|
•
|
equipment used in baking systems and food processing;
|
•
|
portable dredges;
|
•
|
over-the-road car haulers and equipment;
|
•
|
laminated oak and composite wood flooring used in the trucking industry;
|
•
|
dormitory furniture, wall systems, medical casework and marine panels;
|
•
|
storage and transportation equipment for specialty gas;
|
•
|
ornamental plants;
|
•
|
fashion handbags; and
|
•
|
residential homes.
|
•
|
leasing and management of manufactured housing communities;
|
•
|
behavioral healthcare;
|
•
|
concierge health programs;
|
•
|
retail intelligence; and
|
•
|
management and technology consulting.
|
•
|
U.S. consumer markets for residential construction, housing and healthcare;
|
•
|
U.S. and international markets for food service, food production, automobile transporters, governments, miners, marine operators, truck trailers and inter-modal containers and industrial and specialty gas;
|
•
|
U.S. and international retail markets; and
|
•
|
U.S. based businesses in the banking, financial services, energy, utilities, governments, retail and consumer goods, healthcare, travel, and hospitality industries.
|
(1)
|
Collateral is applied to each reinsurer, up to the amount of the gross recoverable, to determine the net recoverable for each reinsurer presented in this table. As of
December 31, 2018
, we were the beneficiary of letters of credit, trust accounts and funds withheld in the aggregate amount of
$1.6 billion
collateralizing reinsurance recoverable balances from our top 10 reinsurers and $2.2 billion for our total reinsurance recoverables balance.
|
(2)
|
Net reinsurance recoverable from Lloyd’s of London includes
$179.8 million
attributable to Syndicate 2357, an unconsolidated affiliate.
|
•
|
trends in claim frequency and severity,
|
•
|
changes in operations,
|
•
|
emerging economic and social trends,
|
•
|
trends in insurance rates,
|
•
|
inflation or deflation, and
|
•
|
changes in the regulatory and litigation environments.
|
|
2018
|
|
2017
|
|
2016
|
||||||
Results of Operations
|
|
|
|
|
|
||||||
Earned premiums
|
$
|
4,712
|
|
|
$
|
4,248
|
|
|
$
|
3,866
|
|
Net investment income
|
434
|
|
|
406
|
|
|
373
|
|
|||
Products revenues
|
1,498
|
|
|
951
|
|
|
885
|
|
|||
Services and other revenues
|
635
|
|
|
462
|
|
|
422
|
|
|||
Total operating revenues
|
6,841
|
|
|
6,062
|
|
|
5,612
|
|
|||
Net income (loss) to shareholders
(2)
|
(128
|
)
|
|
395
|
|
|
456
|
|
|||
Comprehensive income (loss) to shareholders
|
(376
|
)
|
|
1,175
|
|
|
667
|
|
|||
Diluted net income (loss) per share
|
$
|
(9.55
|
)
|
|
$
|
25.81
|
|
|
$
|
31.27
|
|
Financial Position
|
|
|
|
|
|
||||||
Total investments, cash and cash equivalents and restricted cash and cash equivalents (invested assets)
|
$
|
19,238
|
|
|
$
|
20,570
|
|
|
$
|
19,059
|
|
Total assets
|
33,306
|
|
|
32,805
|
|
|
25,875
|
|
|||
Unpaid losses and loss adjustment expenses
|
14,276
|
|
|
13,584
|
|
|
10,116
|
|
|||
Senior long-term debt and other debt
|
3,010
|
|
|
3,099
|
|
|
2,575
|
|
|||
Shareholders' equity
|
9,081
|
|
|
9,504
|
|
|
8,461
|
|
|||
Common shares outstanding (at year end, in thousands)
|
13,888
|
|
|
13,904
|
|
|
13,955
|
|
|||
OPERATING PERFORMANCE MEASURES
(1,3)
|
|
|
|
|
|
||||||
Operating Data
|
|
|
|
|
|
||||||
Book value per common share outstanding
|
$
|
653.85
|
|
|
$
|
683.55
|
|
|
$
|
606.30
|
|
Growth (decline) in book value per share
|
(4
|
)%
|
|
13
|
%
|
|
8
|
%
|
|||
5-Year CAGR in book value per share
(4)
|
7
|
%
|
|
11
|
%
|
|
11
|
%
|
|||
Closing stock price
|
$
|
1,038.05
|
|
|
$
|
1,139.13
|
|
|
$
|
904.50
|
|
5-Year CAGR in closing stock price
(4)
|
12
|
%
|
|
21
|
%
|
|
17
|
%
|
|||
Ratio Analysis
|
|
|
|
|
|
||||||
U.S. GAAP combined ratio
(5)
|
98
|
%
|
|
105
|
%
|
|
92
|
%
|
|||
Investment yield
(6)
|
3
|
%
|
|
3
|
%
|
|
2
|
%
|
|||
Taxable equivalent total investment return
(7)
|
(1
|
)%
|
|
10
|
%
|
|
4
|
%
|
|||
Investment leverage
(8)
|
2.1
|
|
|
2.2
|
|
|
2.3
|
|
|||
Debt to capital
|
25
|
%
|
|
25
|
%
|
|
23
|
%
|
(1)
|
Reflects the acquisition of Alterra Capital Holdings Limited effective May 1, 2013, which included the issuance of equity totaling $2.3 billion.
|
(2)
|
In accordance with the provisions of Financial Accounting Standards Board Accounting Standards Update (ASU) No. 2016-01, beginning January 1, 2018, all changes in the fair value of equity securities are recognized in net income. See further discussion of the impacts of adopting ASU No. 2016-01 in note 1 of the notes to consolidated financial statements.
|
(3)
|
Operating Performance Measures provide a basis for management to evaluate our performance. The method we use to compute these measures may differ from the methods used by other companies. See further discussion of management's evaluation of these measures in Management's Discussion & Analysis of Financial Condition and Results of Operations.
|
(4)
|
CAGR—compound annual growth rate.
|
(5)
|
The U.S. GAAP combined ratio measures the relationship of incurred losses, loss adjustment expenses and underwriting, acquisition and insurance expenses to earned premiums.
|
(6)
|
Investment yield reflects net investment income as a percentage of monthly average invested assets at amortized cost.
|
(7)
|
See "Investing Results" in Management's Discussion & Analysis of Financial Condition and Results of Operations for detail regarding the calculation of taxable equivalent total investment return.
|
(8)
|
Investment leverage represents total invested assets divided by shareholders' equity.
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|
5-Year CAGR
(3)
|
|
10-Year CAGR
(3)
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
$
|
3,824
|
|
|
$
|
3,841
|
|
|
$
|
3,232
|
|
|
$
|
2,147
|
|
|
$
|
1,979
|
|
|
$
|
1,731
|
|
|
$
|
1,816
|
|
|
8
|
%
|
|
9
|
%
|
353
|
|
|
363
|
|
|
317
|
|
|
282
|
|
|
264
|
|
|
273
|
|
|
260
|
|
|
6
|
%
|
|
4
|
%
|
|||||||
872
|
|
|
681
|
|
|
550
|
|
|
367
|
|
|
215
|
|
|
156
|
|
|
83
|
|
|
22
|
%
|
|
34
|
%
|
|||||||
215
|
|
|
203
|
|
|
161
|
|
|
172
|
|
|
136
|
|
|
30
|
|
|
7
|
|
|
32
|
%
|
|
91
|
%
|
|||||||
5,370
|
|
|
5,134
|
|
|
4,323
|
|
|
3,000
|
|
|
2,630
|
|
|
2,225
|
|
|
2,069
|
|
|
10
|
%
|
|
13
|
%
|
|||||||
583
|
|
|
321
|
|
|
281
|
|
|
253
|
|
|
142
|
|
|
267
|
|
|
202
|
|
|
|
|
|
|||||||||
233
|
|
|
936
|
|
|
459
|
|
|
504
|
|
|
252
|
|
|
431
|
|
|
591
|
|
|
|
|
|
|||||||||
$
|
41.74
|
|
|
$
|
22.27
|
|
|
$
|
22.48
|
|
|
$
|
25.89
|
|
|
$
|
14.60
|
|
|
$
|
27.27
|
|
|
$
|
20.52
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
$
|
18,181
|
|
|
$
|
18,638
|
|
|
$
|
17,612
|
|
|
$
|
9,333
|
|
|
$
|
8,728
|
|
|
$
|
8,224
|
|
|
$
|
7,849
|
|
|
2
|
%
|
|
11
|
%
|
24,939
|
|
|
25,198
|
|
|
23,956
|
|
|
12,557
|
|
|
11,532
|
|
|
10,826
|
|
|
10,242
|
|
|
7
|
%
|
|
13
|
%
|
|||||||
10,252
|
|
|
10,404
|
|
|
10,262
|
|
|
5,371
|
|
|
5,399
|
|
|
5,398
|
|
|
5,427
|
|
|
7
|
%
|
|
10
|
%
|
|||||||
2,239
|
|
|
2,251
|
|
|
2,256
|
|
|
1,493
|
|
|
1,294
|
|
|
1,016
|
|
|
964
|
|
|
|
|
|
|||||||||
7,834
|
|
|
7,595
|
|
|
6,674
|
|
|
3,889
|
|
|
3,388
|
|
|
3,172
|
|
|
2,774
|
|
|
6
|
%
|
|
15
|
%
|
|||||||
13,959
|
|
|
13,962
|
|
|
13,986
|
|
|
9,629
|
|
|
9,621
|
|
|
9,718
|
|
|
9,819
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
$
|
561.23
|
|
|
$
|
543.96
|
|
|
$
|
477.16
|
|
|
$
|
403.85
|
|
|
$
|
352.10
|
|
|
$
|
326.36
|
|
|
$
|
282.55
|
|
|
7
|
%
|
|
11
|
%
|
3
|
%
|
|
14
|
%
|
|
18
|
%
|
|
15
|
%
|
|
8
|
%
|
|
16
|
%
|
|
27
|
%
|
|
|
|
|
|||||||||
11
|
%
|
|
14
|
%
|
|
17
|
%
|
|
9
|
%
|
|
9
|
%
|
|
13
|
%
|
|
11
|
%
|
|
|
|
|
|||||||||
$
|
883.35
|
|
|
$
|
682.84
|
|
|
$
|
580.35
|
|
|
$
|
433.42
|
|
|
$
|
414.67
|
|
|
$
|
378.13
|
|
|
$
|
340.00
|
|
|
12
|
%
|
|
13
|
%
|
18
|
%
|
|
15
|
%
|
|
14
|
%
|
|
(2
|
)%
|
|
(3
|
)%
|
|
4
|
%
|
|
(1
|
)%
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
89
|
%
|
|
95
|
%
|
|
97
|
%
|
|
97
|
%
|
|
102
|
%
|
|
97
|
%
|
|
95
|
%
|
|
|
|
|
|||||||||
2
|
%
|
|
2
|
%
|
|
3
|
%
|
|
4
|
%
|
|
4
|
%
|
|
4
|
%
|
|
4
|
%
|
|
|
|
|
|||||||||
(1
|
)%
|
|
7
|
%
|
|
7
|
%
|
|
9
|
%
|
|
7
|
%
|
|
8
|
%
|
|
13
|
%
|
|
|
|
|
|||||||||
2.3
|
|
|
2.5
|
|
|
2.6
|
|
|
2.4
|
|
|
2.6
|
|
|
2.6
|
|
|
2.8
|
|
|
|
|
|
|||||||||
22
|
%
|
|
23
|
%
|
|
25
|
%
|
|
28
|
%
|
|
28
|
%
|
|
24
|
%
|
|
26
|
%
|
|
|
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(dollars in thousands)
|
||||||
ASSETS
|
|
|
|
||||
Investments, at estimated fair value:
|
|
|
|
||||
Fixed maturities, available-for-sale (amortized cost of $9,950,773 in 2018 and $9,551,153 in 2017)
|
$
|
10,043,188
|
|
|
$
|
9,940,670
|
|
Equity securities, available-for-sale (cost of $2,667,661 in 2017)
|
—
|
|
|
5,967,847
|
|
||
Equity securities (cost of $2,971,856 in 2018)
|
5,720,945
|
|
|
—
|
|
||
Short-term investments, available-for-sale (estimated fair value approximates cost)
|
1,077,696
|
|
|
2,160,974
|
|
||
Total Investments
|
16,841,829
|
|
|
18,069,491
|
|
||
Cash and cash equivalents
|
2,014,168
|
|
|
2,198,459
|
|
||
Restricted cash and cash equivalents
|
382,264
|
|
|
302,387
|
|
||
Receivables
|
1,692,526
|
|
|
1,567,453
|
|
||
Reinsurance recoverables
|
5,221,947
|
|
|
4,745,390
|
|
||
Deferred policy acquisition costs
|
474,513
|
|
|
465,569
|
|
||
Prepaid reinsurance premiums
|
1,331,022
|
|
|
1,099,757
|
|
||
Goodwill
|
2,237,975
|
|
|
1,777,464
|
|
||
Intangible assets
|
1,726,196
|
|
|
1,355,681
|
|
||
Other assets
|
1,383,823
|
|
|
1,223,365
|
|
||
Total Assets
|
$
|
33,306,263
|
|
|
$
|
32,805,016
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Unpaid losses and loss adjustment expenses
|
$
|
14,276,479
|
|
|
$
|
13,584,281
|
|
Life and annuity benefits
|
1,001,453
|
|
|
1,072,112
|
|
||
Unearned premiums
|
3,611,028
|
|
|
3,308,779
|
|
||
Payables to insurance and reinsurance companies
|
337,326
|
|
|
324,304
|
|
||
Senior long-term debt and other debt (estimated fair value of $3,030,000 in 2018 and $3,351,000 in 2017)
|
3,009,577
|
|
|
3,099,230
|
|
||
Other liabilities
|
1,796,036
|
|
|
1,748,460
|
|
||
Total Liabilities
|
24,031,899
|
|
|
23,137,166
|
|
||
Redeemable noncontrolling interests
|
174,062
|
|
|
166,269
|
|
||
Commitments and contingencies
|
|
|
|
||||
Shareholders' equity:
|
|
|
|
||||
Common stock
|
3,392,993
|
|
|
3,381,834
|
|
||
Retained earnings
|
5,782,310
|
|
|
3,776,743
|
|
||
Accumulated other comprehensive income (loss)
|
(94,650
|
)
|
|
2,345,571
|
|
||
Total Shareholders' Equity
|
9,080,653
|
|
|
9,504,148
|
|
||
Noncontrolling interests
|
19,649
|
|
|
(2,567
|
)
|
||
Total Equity
|
9,100,302
|
|
|
9,501,581
|
|
||
Total Liabilities and Equity
|
$
|
33,306,263
|
|
|
$
|
32,805,016
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(dollars in thousands, except per share data)
|
||||||||||
OPERATING REVENUES
|
|
|
|
|
|
||||||
Earned premiums
|
$
|
4,712,060
|
|
|
$
|
4,247,978
|
|
|
$
|
3,865,870
|
|
Net investment income
|
434,215
|
|
|
405,709
|
|
|
373,230
|
|
|||
Net investment gains (losses):
|
|
|
|
|
|
||||||
Other-than-temporary impairment losses
|
—
|
|
|
(7,589
|
)
|
|
(18,355
|
)
|
|||
Net realized investment gains (losses), excluding other-than-temporary impairment losses
|
(11,974
|
)
|
|
47,174
|
|
|
66,711
|
|
|||
Change in fair value of equity securities
|
(425,622
|
)
|
|
(44,888
|
)
|
|
16,791
|
|
|||
Net investment gains (losses)
|
(437,596
|
)
|
|
(5,303
|
)
|
|
65,147
|
|
|||
Products revenues
|
1,497,523
|
|
|
951,012
|
|
|
885,473
|
|
|||
Services and other revenues
|
635,083
|
|
|
462,263
|
|
|
422,306
|
|
|||
Total Operating Revenues
|
6,841,285
|
|
|
6,061,659
|
|
|
5,612,026
|
|
|||
OPERATING EXPENSES
|
|
|
|
|
|
||||||
Losses and loss adjustment expenses
|
2,820,715
|
|
|
2,865,761
|
|
|
2,050,744
|
|
|||
Underwriting, acquisition and insurance expenses
|
1,777,511
|
|
|
1,589,464
|
|
|
1,497,125
|
|
|||
Products expenses
|
1,413,248
|
|
|
850,449
|
|
|
755,591
|
|
|||
Services and other expenses
|
474,924
|
|
|
458,621
|
|
|
416,141
|
|
|||
Amortization of intangible assets
|
115,930
|
|
|
80,758
|
|
|
68,533
|
|
|||
Impairment of goodwill and intangible assets
|
199,198
|
|
|
—
|
|
|
18,723
|
|
|||
Total Operating Expenses
|
6,801,526
|
|
|
5,845,053
|
|
|
4,806,857
|
|
|||
Operating Income
|
39,759
|
|
|
216,606
|
|
|
805,169
|
|
|||
Interest expense
|
154,212
|
|
|
132,451
|
|
|
129,896
|
|
|||
Net foreign exchange losses (gains)
|
(106,598
|
)
|
|
(3,140
|
)
|
|
1,253
|
|
|||
Loss on early extinguishment of debt
|
—
|
|
|
—
|
|
|
44,100
|
|
|||
Income (Loss) Before Income Taxes
|
(7,855
|
)
|
|
87,295
|
|
|
629,920
|
|
|||
Income tax expense (benefit)
|
122,498
|
|
|
(313,463
|
)
|
|
169,477
|
|
|||
Net Income (Loss)
|
$
|
(130,353
|
)
|
|
$
|
400,758
|
|
|
$
|
460,443
|
|
Net income (loss) attributable to noncontrolling interests
|
(2,173
|
)
|
|
5,489
|
|
|
4,754
|
|
|||
Net Income (Loss) to Shareholders
|
$
|
(128,180
|
)
|
|
$
|
395,269
|
|
|
$
|
455,689
|
|
|
|
|
|
|
|
||||||
OTHER COMPREHENSIVE INCOME (LOSS)
|
|
|
|
|
|
||||||
Change in net unrealized gains on available-for-sale investments, net of taxes:
|
|
|
|
|
|
||||||
Net holding gains (losses) arising during the period
|
$
|
(241,325
|
)
|
|
$
|
787,339
|
|
|
$
|
275,661
|
|
Change in unrealized other-than-temporary impairment losses on fixed maturities arising during the period
|
—
|
|
|
—
|
|
|
35
|
|
|||
Reclassification adjustments for net gains (losses) included in net income (loss)
|
7,849
|
|
|
(24,296
|
)
|
|
(33,528
|
)
|
|||
Change in net unrealized gains on available-for-sale investments, net of taxes
|
(233,476
|
)
|
|
763,043
|
|
|
242,168
|
|
|||
Change in foreign currency translation adjustments, net of taxes
|
(16,495
|
)
|
|
10,449
|
|
|
(11,704
|
)
|
|||
Change in net actuarial pension loss, net of taxes
|
2,341
|
|
|
6,259
|
|
|
(19,100
|
)
|
|||
Total Other Comprehensive Income (Loss)
|
(247,630
|
)
|
|
779,751
|
|
|
211,364
|
|
|||
Comprehensive Income (Loss)
|
$
|
(377,983
|
)
|
|
$
|
1,180,509
|
|
|
$
|
671,807
|
|
Comprehensive income (loss) attributable to noncontrolling interests
|
(2,213
|
)
|
|
5,535
|
|
|
4,760
|
|
|||
Comprehensive Income (Loss) to Shareholders
|
$
|
(375,770
|
)
|
|
$
|
1,174,974
|
|
|
$
|
667,047
|
|
|
|
|
|
|
|
||||||
NET INCOME (LOSS) PER SHARE
|
|
|
|
|
|
||||||
Basic
|
$
|
(9.55
|
)
|
|
$
|
25.89
|
|
|
$
|
31.41
|
|
Diluted
|
$
|
(9.55
|
)
|
|
$
|
25.81
|
|
|
$
|
31.27
|
|
(in thousands)
|
Common
Shares
|
|
Common
Stock
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Total
Shareholders'
Equity
|
|
Noncontrolling
Interests
|
|
Total Equity
|
|
Redeemable Noncontrolling Interests
|
|||||||||||||||
December 31, 2015
|
13,959
|
|
|
$
|
3,342,357
|
|
|
$
|
3,137,285
|
|
|
$
|
1,354,508
|
|
|
$
|
7,834,150
|
|
|
$
|
6,459
|
|
|
$
|
7,840,609
|
|
|
$
|
62,958
|
|
Net income
|
|
|
|
|
455,689
|
|
|
—
|
|
|
455,689
|
|
|
99
|
|
|
455,788
|
|
|
4,655
|
|
|||||||||
Other comprehensive income
|
|
|
|
|
—
|
|
|
211,358
|
|
|
211,358
|
|
|
—
|
|
|
211,358
|
|
|
6
|
|
|||||||||
Comprehensive Income
|
|
|
|
|
|
|
|
|
667,047
|
|
|
99
|
|
|
667,146
|
|
|
4,661
|
|
|||||||||||
Issuance of common stock
|
54
|
|
|
4,623
|
|
|
—
|
|
|
—
|
|
|
4,623
|
|
|
—
|
|
|
4,623
|
|
|
—
|
|
|||||||
Repurchase of common stock
|
(58
|
)
|
|
—
|
|
|
(51,142
|
)
|
|
—
|
|
|
(51,142
|
)
|
|
—
|
|
|
(51,142
|
)
|
|
—
|
|
|||||||
Restricted stock awards expensed
|
—
|
|
|
21,336
|
|
|
—
|
|
|
—
|
|
|
21,336
|
|
|
—
|
|
|
21,336
|
|
|
—
|
|
|||||||
Adjustment of redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
(15,472
|
)
|
|
—
|
|
|
(15,472
|
)
|
|
—
|
|
|
(15,472
|
)
|
|
15,472
|
|
|||||||
Purchase of noncontrolling interest
|
—
|
|
|
350
|
|
|
—
|
|
|
—
|
|
|
350
|
|
|
—
|
|
|
350
|
|
|
(3,517
|
)
|
|||||||
Other
|
—
|
|
|
—
|
|
|
35
|
|
|
—
|
|
|
35
|
|
|
(74
|
)
|
|
(39
|
)
|
|
(5,896
|
)
|
|||||||
December 31, 2016
|
13,955
|
|
|
3,368,666
|
|
|
3,526,395
|
|
|
1,565,866
|
|
|
8,460,927
|
|
|
6,484
|
|
|
8,467,411
|
|
|
73,678
|
|
|||||||
Net income (loss)
|
|
|
|
|
395,269
|
|
|
—
|
|
|
395,269
|
|
|
(895
|
)
|
|
394,374
|
|
|
6,384
|
|
|||||||||
Other comprehensive income
|
|
|
|
|
—
|
|
|
779,705
|
|
|
779,705
|
|
|
—
|
|
|
779,705
|
|
|
46
|
|
|||||||||
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
1,174,974
|
|
|
(895
|
)
|
|
1,174,079
|
|
|
6,430
|
|
|||||||||||
Issuance of common stock
|
58
|
|
|
552
|
|
|
—
|
|
|
—
|
|
|
552
|
|
|
—
|
|
|
552
|
|
|
—
|
|
|||||||
Repurchase of common stock
|
(109
|
)
|
|
—
|
|
|
(110,838
|
)
|
|
—
|
|
|
(110,838
|
)
|
|
—
|
|
|
(110,838
|
)
|
|
—
|
|
|||||||
Restricted stock awards expensed
|
—
|
|
|
15,881
|
|
|
—
|
|
|
—
|
|
|
15,881
|
|
|
—
|
|
|
15,881
|
|
|
—
|
|
|||||||
Acquisition of Costa Farms
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66,600
|
|
|||||||
Adjustment of redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
(33,738
|
)
|
|
—
|
|
|
(33,738
|
)
|
|
—
|
|
|
(33,738
|
)
|
|
33,738
|
|
|||||||
Purchase of noncontrolling interest
|
—
|
|
|
(2,955
|
)
|
|
—
|
|
|
—
|
|
|
(2,955
|
)
|
|
(8,330
|
)
|
|
(11,285
|
)
|
|
(6,179
|
)
|
|||||||
Other
|
—
|
|
|
(310
|
)
|
|
(345
|
)
|
|
—
|
|
|
(655
|
)
|
|
174
|
|
|
(481
|
)
|
|
(7,998
|
)
|
|||||||
December 31, 2017
|
13,904
|
|
|
3,381,834
|
|
|
3,776,743
|
|
|
2,345,571
|
|
|
9,504,148
|
|
|
(2,567
|
)
|
|
9,501,581
|
|
|
166,269
|
|
|||||||
Cumulative effect of adoption of ASU No. 2014-09, net of taxes
|
|
|
|
|
325
|
|
|
—
|
|
|
325
|
|
|
—
|
|
|
325
|
|
|
—
|
|
|||||||||
Cumulative effect of adoption of ASU No. 2016-01, net of taxes
|
|
|
|
|
2,595,484
|
|
|
(2,595,484
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Cumulative effect of adoption of ASU No. 2018-02
|
|
|
|
|
(402,853
|
)
|
|
402,853
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
January 1, 2018
|
13,904
|
|
|
3,381,834
|
|
|
5,969,699
|
|
|
152,940
|
|
|
9,504,473
|
|
|
(2,567
|
)
|
|
9,501,906
|
|
|
166,269
|
|
|||||||
Net loss
|
|
|
|
|
(128,180
|
)
|
|
—
|
|
|
(128,180
|
)
|
|
(1,175
|
)
|
|
(129,355
|
)
|
|
(998
|
)
|
|||||||||
Other comprehensive loss
|
|
|
|
|
—
|
|
|
(247,590
|
)
|
|
(247,590
|
)
|
|
—
|
|
|
(247,590
|
)
|
|
(40
|
)
|
|||||||||
Comprehensive Loss
|
|
|
|
|
|
|
|
|
(375,770
|
)
|
|
(1,175
|
)
|
|
(376,945
|
)
|
|
(1,038
|
)
|
|||||||||||
Issuance of common stock
|
32
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|||||||
Repurchase of common stock
|
(48
|
)
|
|
—
|
|
|
(54,007
|
)
|
|
—
|
|
|
(54,007
|
)
|
|
—
|
|
|
(54,007
|
)
|
|
—
|
|
|||||||
Restricted stock awards expensed
|
—
|
|
|
16,191
|
|
|
—
|
|
|
—
|
|
|
16,191
|
|
|
—
|
|
|
16,191
|
|
|
—
|
|
|||||||
Acquisition of Brahmin
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,670
|
|
|||||||
Acquisition of Nephila
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23,392
|
|
|
23,392
|
|
|
—
|
|
|||||||
Adjustment of redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
(4,828
|
)
|
|
—
|
|
|
(4,828
|
)
|
|
—
|
|
|
(4,828
|
)
|
|
4,828
|
|
|||||||
Purchase of noncontrolling interest
|
—
|
|
|
(4,986
|
)
|
|
—
|
|
|
—
|
|
|
(4,986
|
)
|
|
—
|
|
|
(4,986
|
)
|
|
(7,104
|
)
|
|||||||
Other
|
—
|
|
|
(48
|
)
|
|
(374
|
)
|
|
—
|
|
|
(422
|
)
|
|
(1
|
)
|
|
(423
|
)
|
|
(8,563
|
)
|
|||||||
December 31, 2018
|
13,888
|
|
|
$
|
3,392,993
|
|
|
$
|
5,782,310
|
|
|
$
|
(94,650
|
)
|
|
$
|
9,080,653
|
|
|
$
|
19,649
|
|
|
$
|
9,100,302
|
|
|
$
|
174,062
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(dollars in thousands)
|
||||||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(130,353
|
)
|
|
$
|
400,758
|
|
|
$
|
460,443
|
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Deferred income tax expense (benefit)
|
2,729
|
|
|
(324,090
|
)
|
|
63,358
|
|
|||
Depreciation and amortization
|
227,846
|
|
|
203,871
|
|
|
194,147
|
|
|||
Net investment losses (gains)
|
437,596
|
|
|
5,303
|
|
|
(65,147
|
)
|
|||
Loss on early extinguishment of debt
|
—
|
|
|
—
|
|
|
44,100
|
|
|||
Net foreign exchange losses (gains)
|
(106,598
|
)
|
|
(3,140
|
)
|
|
1,253
|
|
|||
Impairment of goodwill and intangible assets
|
199,198
|
|
|
—
|
|
|
18,723
|
|
|||
Increase in receivables
|
(27,961
|
)
|
|
(38,259
|
)
|
|
(163,123
|
)
|
|||
Increase in deferred policy acquisition costs
|
(15,585
|
)
|
|
(67,923
|
)
|
|
(41,619
|
)
|
|||
Increase (decrease) in unpaid losses and loss adjustment expenses, net
|
298,796
|
|
|
619,305
|
|
|
(9,429
|
)
|
|||
Decrease in life and annuity benefits
|
(50,541
|
)
|
|
(55,647
|
)
|
|
(54,580
|
)
|
|||
Increase in unearned premiums, net
|
62,879
|
|
|
197,706
|
|
|
134,593
|
|
|||
Increase (decrease) in payables to insurance and reinsurance companies
|
(4,313
|
)
|
|
(40,761
|
)
|
|
11,582
|
|
|||
Increase (decrease) in income taxes payable
|
53,730
|
|
|
(35,968
|
)
|
|
(16,484
|
)
|
|||
Increase (decrease) in accrued expenses
|
(23,756
|
)
|
|
(71,669
|
)
|
|
67,994
|
|
|||
Increase (decrease) in other liabilities
|
(5,637
|
)
|
|
45,051
|
|
|
(90,571
|
)
|
|||
Other
|
(25,173
|
)
|
|
23,992
|
|
|
(20,617
|
)
|
|||
Net Cash Provided By Operating Activities
|
892,857
|
|
|
858,529
|
|
|
534,623
|
|
|||
INVESTING ACTIVITIES
|
|
|
|
|
|
||||||
Proceeds from sales of fixed maturities and equity securities
|
419,199
|
|
|
577,650
|
|
|
365,822
|
|
|||
Proceeds from maturities, calls and prepayments of fixed maturities
|
551,808
|
|
|
1,129,895
|
|
|
963,165
|
|
|||
Cost of fixed maturities and equity securities purchased
|
(1,545,913
|
)
|
|
(1,176,281
|
)
|
|
(2,205,939
|
)
|
|||
Net change in short-term investments
|
1,101,636
|
|
|
234,743
|
|
|
(689,194
|
)
|
|||
Additions to property and equipment
|
(106,593
|
)
|
|
(74,652
|
)
|
|
(63,674
|
)
|
|||
Acquisitions, net of cash acquired
|
(1,175,211
|
)
|
|
(1,431,712
|
)
|
|
(7,527
|
)
|
|||
Other
|
(42,165
|
)
|
|
(4,100
|
)
|
|
(1,134
|
)
|
|||
Net Cash Used By Investing Activities
|
(797,239
|
)
|
|
(744,457
|
)
|
|
(1,638,481
|
)
|
|||
FINANCING ACTIVITIES
|
|
|
|
|
|
||||||
Additions to senior long-term debt and other debt
|
206,949
|
|
|
664,657
|
|
|
559,300
|
|
|||
Repayment of senior long-term debt and other debt
|
(289,199
|
)
|
|
(259,972
|
)
|
|
(278,363
|
)
|
|||
Premiums and fees related to early extinguishment of debt
|
—
|
|
|
—
|
|
|
(43,691
|
)
|
|||
Repurchases of common stock
|
(54,007
|
)
|
|
(110,838
|
)
|
|
(51,142
|
)
|
|||
Payment of contingent consideration
|
(15,914
|
)
|
|
(5,018
|
)
|
|
(14,219
|
)
|
|||
Purchase of noncontrolling interests
|
(13,523
|
)
|
|
(18,334
|
)
|
|
(3,167
|
)
|
|||
Distributions to noncontrolling interests
|
(9,164
|
)
|
|
(7,899
|
)
|
|
(5,949
|
)
|
|||
Other
|
(4,127
|
)
|
|
(6,281
|
)
|
|
(10,750
|
)
|
|||
Net Cash Provided (Used) By Financing Activities
|
(178,985
|
)
|
|
256,315
|
|
|
152,019
|
|
|||
Effect of foreign currency rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents
|
(21,047
|
)
|
|
45,295
|
|
|
(33,138
|
)
|
|||
Increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents
|
(104,414
|
)
|
|
415,682
|
|
|
(984,977
|
)
|
|||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of year
|
2,500,846
|
|
|
2,085,164
|
|
|
3,070,141
|
|
|||
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS AT END OF YEAR
|
$
|
2,396,432
|
|
|
$
|
2,500,846
|
|
|
$
|
2,085,164
|
|
•
|
ASU No. 2016-16,
Income Taxes (Topic 740): Intra-entity Transfers of Assets Other Than Inventory
|
•
|
ASU No. 2017-07,
Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost
|
•
|
ASU No. 2017-09,
Stock Compensation (Topic 718): Scope of Modification Accounting
|
•
|
ASU No. 2017-08,
Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities
|
•
|
ASU No. 2018-13,
Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement
|
•
|
ASU No. 2018-14,
Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans
|
•
|
ASU No. 2018-17,
Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities
|
(dollars in thousands)
|
Amount
|
|
Economic
Useful Life
|
||
Customer relationships
|
$
|
289,000
|
|
|
13 years
|
Trade names
|
22,500
|
|
|
13 years
|
|
Technology
|
27,000
|
|
|
Nine years
|
|
Insurance licenses
|
32,000
|
|
|
Indefinite
|
|
Intangible assets, before amortization, as of the Acquisition Date
|
370,500
|
|
|
|
|
Amortization (from the Acquisition Date through December 31, 2018)
|
32,336
|
|
|
|
|
Net intangible assets as of December 31, 2018
|
$
|
338,164
|
|
|
|
|
December 31, 2018
|
||||||||||||||
(dollars in thousands)
|
Amortized
Cost
|
|
Gross
Unrealized
Holding
Gains
|
|
Gross
Unrealized
Holding
Losses
|
|
Estimated
Fair
Value
|
||||||||
Fixed maturities:
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury securities
|
$
|
248,286
|
|
|
$
|
308
|
|
|
$
|
(1,952
|
)
|
|
$
|
246,642
|
|
U.S. government-sponsored enterprises
|
357,765
|
|
|
5,671
|
|
|
(4,114
|
)
|
|
359,322
|
|
||||
Obligations of states, municipalities and political subdivisions
|
4,285,068
|
|
|
96,730
|
|
|
(28,868
|
)
|
|
4,352,930
|
|
||||
Foreign governments
|
1,482,826
|
|
|
98,356
|
|
|
(21,578
|
)
|
|
1,559,604
|
|
||||
Commercial mortgage-backed securities
|
1,691,572
|
|
|
3,154
|
|
|
(44,527
|
)
|
|
1,650,199
|
|
||||
Residential mortgage-backed securities
|
886,501
|
|
|
6,170
|
|
|
(12,499
|
)
|
|
880,172
|
|
||||
Asset-backed securities
|
19,614
|
|
|
7
|
|
|
(213
|
)
|
|
19,408
|
|
||||
Corporate bonds
|
979,141
|
|
|
13,234
|
|
|
(17,464
|
)
|
|
974,911
|
|
||||
Total fixed maturities
|
9,950,773
|
|
|
223,630
|
|
|
(131,215
|
)
|
|
10,043,188
|
|
||||
Short-term investments
|
1,080,027
|
|
|
443
|
|
|
(2,774
|
)
|
|
1,077,696
|
|
||||
Investments, available-for-sale
|
$
|
11,030,800
|
|
|
$
|
224,073
|
|
|
$
|
(133,989
|
)
|
|
$
|
11,120,884
|
|
|
|
|
|
|
|
|
|
||||||||
|
December 31, 2017
|
||||||||||||||
(dollars in thousands)
|
Amortized
Cost
|
|
Gross
Unrealized
Holding
Gains
|
|
Gross
Unrealized
Holding
Losses
|
|
Estimated
Fair
Value
|
||||||||
Fixed maturities:
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury securities
|
$
|
162,378
|
|
|
$
|
54
|
|
|
$
|
(1,819
|
)
|
|
$
|
160,613
|
|
U.S. government-sponsored enterprises
|
352,455
|
|
|
11,883
|
|
|
(818
|
)
|
|
363,520
|
|
||||
Obligations of states, municipalities and political subdivisions
|
4,381,358
|
|
|
193,120
|
|
|
(7,916
|
)
|
|
4,566,562
|
|
||||
Foreign governments
|
1,341,628
|
|
|
150,010
|
|
|
(2,410
|
)
|
|
1,489,228
|
|
||||
Commercial mortgage-backed securities
|
1,244,777
|
|
|
6,108
|
|
|
(16,559
|
)
|
|
1,234,326
|
|
||||
Residential mortgage-backed securities
|
846,916
|
|
|
14,115
|
|
|
(4,863
|
)
|
|
856,168
|
|
||||
Asset-backed securities
|
34,942
|
|
|
8
|
|
|
(222
|
)
|
|
34,728
|
|
||||
Corporate bonds
|
1,186,699
|
|
|
51,563
|
|
|
(2,737
|
)
|
|
1,235,525
|
|
||||
Total fixed maturities
|
9,551,153
|
|
|
426,861
|
|
|
(37,344
|
)
|
|
9,940,670
|
|
||||
Equity securities:
(1)
|
|
|
|
|
|
|
|
||||||||
Insurance, banks and other financial institutions
|
899,324
|
|
|
1,209,162
|
|
|
(5,453
|
)
|
|
2,103,033
|
|
||||
Industrial, consumer and all other
|
1,768,337
|
|
|
2,110,959
|
|
|
(14,482
|
)
|
|
3,864,814
|
|
||||
Total equity securities
|
2,667,661
|
|
|
3,320,121
|
|
|
(19,935
|
)
|
|
5,967,847
|
|
||||
Short-term investments
|
2,161,017
|
|
|
26
|
|
|
(69
|
)
|
|
2,160,974
|
|
||||
Investments, available-for-sale
|
$
|
14,379,831
|
|
|
$
|
3,747,008
|
|
|
$
|
(57,348
|
)
|
|
$
|
18,069,491
|
|
(1)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01 and equity securities are no longer classified as available-for-sale. Prior periods have not been restated to conform to the current presentation. See note 1.
|
|
December 31, 2018
|
||||||||||||||||||||||
|
Less than 12 months
|
|
12 months or longer
|
|
Total
|
||||||||||||||||||
(dollars in thousands)
|
Estimated
Fair
Value
|
|
Gross
Unrealized Holding Losses |
|
Estimated
Fair
Value
|
|
Gross
Unrealized Holding Losses |
|
Estimated
Fair
Value
|
|
Gross
Unrealized Holding
Losses
|
||||||||||||
Fixed maturities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Treasury securities
|
$
|
2,922
|
|
|
$
|
(83
|
)
|
|
$
|
156,352
|
|
|
$
|
(1,869
|
)
|
|
$
|
159,274
|
|
|
$
|
(1,952
|
)
|
U.S. government-sponsored enterprises
|
88,854
|
|
|
(1,923
|
)
|
|
96,337
|
|
|
(2,191
|
)
|
|
185,191
|
|
|
(4,114
|
)
|
||||||
Obligations of states, municipalities and political subdivisions
|
656,573
|
|
|
(12,455
|
)
|
|
453,736
|
|
|
(16,413
|
)
|
|
1,110,309
|
|
|
(28,868
|
)
|
||||||
Foreign governments
|
419,764
|
|
|
(14,461
|
)
|
|
84,776
|
|
|
(7,117
|
)
|
|
504,540
|
|
|
(21,578
|
)
|
||||||
Commercial mortgage-backed securities
|
653,410
|
|
|
(10,128
|
)
|
|
709,971
|
|
|
(34,399
|
)
|
|
1,363,381
|
|
|
(44,527
|
)
|
||||||
Residential mortgage-backed securities
|
276,777
|
|
|
(3,685
|
)
|
|
242,949
|
|
|
(8,814
|
)
|
|
519,726
|
|
|
(12,499
|
)
|
||||||
Asset-backed securities
|
1,645
|
|
|
(11
|
)
|
|
17,030
|
|
|
(202
|
)
|
|
18,675
|
|
|
(213
|
)
|
||||||
Corporate bonds
|
313,164
|
|
|
(10,965
|
)
|
|
222,761
|
|
|
(6,499
|
)
|
|
535,925
|
|
|
(17,464
|
)
|
||||||
Total fixed maturities
|
2,413,109
|
|
|
(53,711
|
)
|
|
1,983,912
|
|
|
(77,504
|
)
|
|
4,397,021
|
|
|
(131,215
|
)
|
||||||
Short-term investments
|
197,643
|
|
|
(2,774
|
)
|
|
—
|
|
|
—
|
|
|
197,643
|
|
|
(2,774
|
)
|
||||||
Total
|
$
|
2,610,752
|
|
|
$
|
(56,485
|
)
|
|
$
|
1,983,912
|
|
|
$
|
(77,504
|
)
|
|
$
|
4,594,664
|
|
|
$
|
(133,989
|
)
|
|
December 31, 2017
|
||||||||||||||||||||||
|
Less than 12 months
|
|
12 months or longer
|
|
Total
|
||||||||||||||||||
(dollars in thousands)
|
Estimated
Fair
Value
|
|
Gross
Unrealized Holding Losses |
|
Estimated
Fair
Value
|
|
Gross
Unrealized Holding Losses |
|
Estimated
Fair
Value
|
|
Gross
Unrealized Holding Losses |
||||||||||||
Fixed maturities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Treasury securities
|
$
|
78,756
|
|
|
$
|
(659
|
)
|
|
$
|
78,298
|
|
|
$
|
(1,160
|
)
|
|
$
|
157,054
|
|
|
$
|
(1,819
|
)
|
U.S. government-sponsored enterprises
|
11,593
|
|
|
(79
|
)
|
|
89,194
|
|
|
(739
|
)
|
|
100,787
|
|
|
(818
|
)
|
||||||
Obligations of states, municipalities and political subdivisions
|
80,654
|
|
|
(789
|
)
|
|
404,814
|
|
|
(7,127
|
)
|
|
485,468
|
|
|
(7,916
|
)
|
||||||
Foreign governments
|
31,752
|
|
|
(452
|
)
|
|
63,406
|
|
|
(1,958
|
)
|
|
95,158
|
|
|
(2,410
|
)
|
||||||
Commercial mortgage-backed securities
|
253,936
|
|
|
(1,980
|
)
|
|
481,216
|
|
|
(14,579
|
)
|
|
735,152
|
|
|
(16,559
|
)
|
||||||
Residential mortgage-backed securities
|
157,508
|
|
|
(1,345
|
)
|
|
148,960
|
|
|
(3,518
|
)
|
|
306,468
|
|
|
(4,863
|
)
|
||||||
Asset-backed securities
|
14,263
|
|
|
(123
|
)
|
|
15,165
|
|
|
(99
|
)
|
|
29,428
|
|
|
(222
|
)
|
||||||
Corporate bonds
|
149,345
|
|
|
(863
|
)
|
|
187,754
|
|
|
(1,874
|
)
|
|
337,099
|
|
|
(2,737
|
)
|
||||||
Total fixed maturities
|
777,807
|
|
|
(6,290
|
)
|
|
1,468,807
|
|
|
(31,054
|
)
|
|
2,246,614
|
|
|
(37,344
|
)
|
||||||
Equity securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Insurance, banks and other financial institutions
|
60,848
|
|
|
(4,843
|
)
|
|
1,291
|
|
|
(610
|
)
|
|
62,139
|
|
|
(5,453
|
)
|
||||||
Industrial, consumer and all other
|
78,552
|
|
|
(11,798
|
)
|
|
11,243
|
|
|
(2,684
|
)
|
|
89,795
|
|
|
(14,482
|
)
|
||||||
Total equity securities
|
139,400
|
|
|
(16,641
|
)
|
|
12,534
|
|
|
(3,294
|
)
|
|
151,934
|
|
|
(19,935
|
)
|
||||||
Short-term investments
|
369,104
|
|
|
(69
|
)
|
|
—
|
|
|
—
|
|
|
369,104
|
|
|
(69
|
)
|
||||||
Total
|
$
|
1,286,311
|
|
|
$
|
(23,000
|
)
|
|
$
|
1,481,341
|
|
|
$
|
(34,348
|
)
|
|
$
|
2,767,652
|
|
|
$
|
(57,348
|
)
|
(1)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01 and equity securities are no longer classified as available-for-sale. Prior periods have not been restated to conform to the current presentation. See note 1.
|
(dollars in thousands)
|
Amortized
Cost
|
|
Estimated
Fair Value
|
||||
Due in one year or less
|
$
|
377,745
|
|
|
$
|
376,564
|
|
Due after one year through five years
|
1,293,384
|
|
|
1,298,995
|
|
||
Due after five years through ten years
|
2,103,596
|
|
|
2,137,866
|
|
||
Due after ten years
|
3,578,361
|
|
|
3,679,984
|
|
||
|
7,353,086
|
|
|
7,493,409
|
|
||
Commercial mortgage-backed securities
|
1,691,572
|
|
|
1,650,199
|
|
||
Residential mortgage-backed securities
|
886,501
|
|
|
880,172
|
|
||
Asset-backed securities
|
19,614
|
|
|
19,408
|
|
||
Total fixed maturities
|
$
|
9,950,773
|
|
|
$
|
10,043,188
|
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Interest:
|
|
|
|
|
|
||||||
Municipal bonds (tax-exempt)
|
$
|
80,016
|
|
|
$
|
87,768
|
|
|
$
|
88,654
|
|
Municipal bonds (taxable)
|
73,058
|
|
|
70,771
|
|
|
65,749
|
|
|||
Other taxable bonds
|
159,329
|
|
|
145,085
|
|
|
144,752
|
|
|||
Short-term investments, including overnight deposits
|
48,765
|
|
|
26,772
|
|
|
11,177
|
|
|||
Dividends on equity securities
|
90,840
|
|
|
82,096
|
|
|
70,577
|
|
|||
Income (loss) from equity method investments
|
(1,924
|
)
|
|
11,076
|
|
|
6,852
|
|
|||
Other
|
881
|
|
|
(828
|
)
|
|
2,676
|
|
|||
|
450,965
|
|
|
422,740
|
|
|
390,437
|
|
|||
Investment expenses
|
(16,750
|
)
|
|
(17,031
|
)
|
|
(17,207
|
)
|
|||
Net investment income
|
$
|
434,215
|
|
|
$
|
405,709
|
|
|
$
|
373,230
|
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Realized gains:
|
|
|
|
|
|
||||||
Sales and maturities of fixed maturities
|
$
|
4,221
|
|
|
$
|
5,525
|
|
|
$
|
5,160
|
|
Sales of equity securities
(1)
|
—
|
|
|
40,113
|
|
|
70,177
|
|
|||
Sales and maturities of short-term investments
|
1,604
|
|
|
—
|
|
|
—
|
|
|||
Other
|
1,281
|
|
|
6,644
|
|
|
1,415
|
|
|||
Total realized gains
|
7,106
|
|
|
52,282
|
|
|
76,752
|
|
|||
Realized losses:
|
|
|
|
|
|
||||||
Sales and maturities of fixed maturities
|
(5,768
|
)
|
|
(1,983
|
)
|
|
(704
|
)
|
|||
Sales of equity securities
(1)
|
—
|
|
|
(1,830
|
)
|
|
(6,988
|
)
|
|||
Sales and maturities of short-term investments
|
(10,545
|
)
|
|
(699
|
)
|
|
(522
|
)
|
|||
Other-than-temporary impairments
|
—
|
|
|
(7,589
|
)
|
|
(18,355
|
)
|
|||
Other
|
(2,767
|
)
|
|
(596
|
)
|
|
(1,827
|
)
|
|||
Total realized losses
|
(19,080
|
)
|
|
(12,697
|
)
|
|
(28,396
|
)
|
|||
Net realized investment gains (losses)
|
(11,974
|
)
|
|
39,585
|
|
|
48,356
|
|
|||
Change in fair value of equity securities:
(1)
|
|
|
|
|
|
||||||
Change in fair value of equity securities sold during the period
|
20,177
|
|
|
6,989
|
|
|
(3,990
|
)
|
|||
Change in fair value of equity securities held at the end of the period
|
(445,799
|
)
|
|
(51,877
|
)
|
|
20,781
|
|
|||
Change in fair value of equity securities
(1)
|
(425,622
|
)
|
|
(44,888
|
)
|
|
16,791
|
|
|||
Net investment gains (losses)
|
$
|
(437,596
|
)
|
|
$
|
(5,303
|
)
|
|
$
|
65,147
|
|
Change in net unrealized gains on available-for-sale investments included in other comprehensive income (loss):
|
|
|
|
|
|
||||||
Fixed maturities
|
$
|
(297,158
|
)
|
|
$
|
89,741
|
|
|
$
|
(56,534
|
)
|
Equity securities
(1)
|
—
|
|
|
1,035,793
|
|
|
398,752
|
|
|||
Short-term investments
|
(2,288
|
)
|
|
(94
|
)
|
|
(107
|
)
|
|||
Net increase (decrease)
|
$
|
(299,446
|
)
|
|
$
|
1,125,440
|
|
|
$
|
342,111
|
|
(1)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01. As a result, equity securities are no longer classified as available-for-sale with unrealized gains and losses recognized in other comprehensive income; rather, all changes in the fair value of equity securities are now recognized in net income. Prior periods have not been restated to conform to the current presentation. See note 1. Prior to adopting ASU No. 2016-01, the Company recorded certain investments in equity securities at estimated fair value with changes in fair value recorded in net income.
|
|
December 31,
|
||||||
(dollars in thousands)
|
2018
|
|
2017
|
||||
Investments
|
$
|
4,781,566
|
|
|
$
|
4,672,073
|
|
Restricted cash and cash equivalents
|
382,264
|
|
|
302,387
|
|
||
Total
|
$
|
5,163,830
|
|
|
$
|
4,974,460
|
|
|
December 31,
|
||||||
(dollars in thousands)
|
2018
|
|
2017
|
||||
Restricted assets held in trust or on deposit to support underwriting activities
|
$
|
4,780,613
|
|
|
$
|
4,624,998
|
|
Investments and cash and cash equivalents pledged as security for letters of credit
|
383,217
|
|
|
349,462
|
|
||
Total
|
$
|
5,163,830
|
|
|
$
|
4,974,460
|
|
|
December 31,
|
||||||
(dollars in thousands)
|
2018
|
|
2017
|
||||
Amounts receivable from agents, brokers and insureds
|
$
|
1,327,549
|
|
|
$
|
1,281,366
|
|
Trade accounts receivable
|
226,282
|
|
|
181,666
|
|
||
Notes receivable
|
40,375
|
|
|
528
|
|
||
Program services fees receivable
|
24,787
|
|
|
22,767
|
|
||
Employee stock loans receivable (see note 12(c))
|
19,227
|
|
|
18,499
|
|
||
Investment management and incentive fees receivable
|
16,744
|
|
|
5,796
|
|
||
Insurance proceeds receivable
|
—
|
|
|
39,196
|
|
||
Other
|
53,140
|
|
|
31,410
|
|
||
|
1,708,104
|
|
|
1,581,228
|
|
||
Allowance for doubtful receivables
|
(15,578
|
)
|
|
(13,775
|
)
|
||
Receivables
|
$
|
1,692,526
|
|
|
$
|
1,567,453
|
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Balance, beginning of year
|
$
|
465,569
|
|
|
$
|
392,410
|
|
|
$
|
352,756
|
|
Policy acquisition costs deferred
|
1,024,888
|
|
|
964,755
|
|
|
823,840
|
|
|||
Amortization of policy acquisition costs
|
(1,009,303
|
)
|
|
(894,353
|
)
|
|
(782,221
|
)
|
|||
Foreign currency movements
|
(6,641
|
)
|
|
2,757
|
|
|
(1,965
|
)
|
|||
Deferred policy acquisition costs
|
$
|
474,513
|
|
|
$
|
465,569
|
|
|
$
|
392,410
|
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Amortization of policy acquisition costs
|
$
|
1,009,303
|
|
|
$
|
894,353
|
|
|
$
|
782,221
|
|
Other operating expenses
|
768,208
|
|
|
695,111
|
|
|
714,904
|
|
|||
Underwriting, acquisition and insurance expenses
|
$
|
1,777,511
|
|
|
$
|
1,589,464
|
|
|
$
|
1,497,125
|
|
|
December 31,
|
||||||
(dollars in thousands)
|
2018
|
|
2017
|
||||
Land
|
$
|
72,011
|
|
|
$
|
66,885
|
|
Buildings
|
137,095
|
|
|
119,729
|
|
||
Leasehold improvements
|
108,973
|
|
|
98,246
|
|
||
Land improvements
|
93,545
|
|
|
89,444
|
|
||
Furniture and equipment
|
392,060
|
|
|
341,450
|
|
||
Other
|
227,356
|
|
|
196,465
|
|
||
|
1,031,040
|
|
|
912,219
|
|
||
Accumulated depreciation and amortization
|
(479,498
|
)
|
|
(410,602
|
)
|
||
Property and equipment
|
$
|
551,542
|
|
|
$
|
501,617
|
|
(dollars in thousands)
|
Insurance
|
|
Reinsurance
|
|
Markel Ventures
|
|
Other
(1)
|
|
Total
|
||||||||||
January 1, 2017
|
$
|
672,763
|
|
|
$
|
122,745
|
|
|
$
|
237,767
|
|
|
$
|
108,973
|
|
|
$
|
1,142,248
|
|
Acquisitions (see note 2)
|
93,123
|
|
|
—
|
|
|
186,194
|
|
|
347,418
|
|
|
626,735
|
|
|||||
Foreign currency movements and other adjustments
|
5,935
|
|
|
—
|
|
|
1,020
|
|
|
1,526
|
|
|
8,481
|
|
|||||
December 31, 2017
(2)
|
$
|
771,821
|
|
|
$
|
122,745
|
|
|
$
|
424,981
|
|
|
$
|
457,917
|
|
|
$
|
1,777,464
|
|
Acquisitions (see note 2)
|
—
|
|
|
—
|
|
|
73,174
|
|
|
474,901
|
|
|
548,075
|
|
|||||
Impairment of goodwill
|
—
|
|
|
—
|
|
|
—
|
|
|
(91,910
|
)
|
|
(91,910
|
)
|
|||||
Foreign currency movements and other adjustments
|
(1,637
|
)
|
|
—
|
|
|
(817
|
)
|
|
6,800
|
|
|
4,346
|
|
|||||
December 31, 2018
(2)
|
$
|
770,184
|
|
|
$
|
122,745
|
|
|
$
|
497,338
|
|
|
$
|
847,708
|
|
|
$
|
2,237,975
|
|
(1)
|
Amounts included in Other reflect the Company's operations that are not included in a reportable segment.
|
(2)
|
As of December 31,
2018
, goodwill was net of accumulated impairment losses of
$139.2 million
, of which
$91.9 million
was in Other and
$47.3 million
was in Markel Ventures. As of December 31,
2017
, goodwill was net of accumulated impairment losses of
$47.3 million
, all of which was included in Markel Ventures.
|
|
December 31,
|
||||||||||||||
|
2018
|
|
2017
|
||||||||||||
(dollars in thousands)
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
Customer relationships
|
$
|
953,739
|
|
|
$
|
(204,261
|
)
|
|
$
|
941,477
|
|
|
$
|
(161,797
|
)
|
Investment management agreements
|
441,000
|
|
|
—
|
|
|
98,000
|
|
|
(14,000
|
)
|
||||
Broker relationships
|
204,367
|
|
|
(78,559
|
)
|
|
184,959
|
|
|
(69,677
|
)
|
||||
Trade names
|
193,154
|
|
|
(62,827
|
)
|
|
164,335
|
|
|
(59,660
|
)
|
||||
Technology
|
109,208
|
|
|
(47,090
|
)
|
|
94,712
|
|
|
(44,489
|
)
|
||||
Agent relationships
|
92,000
|
|
|
(10,175
|
)
|
|
92,000
|
|
|
(4,042
|
)
|
||||
Insurance licenses
|
74,635
|
|
|
—
|
|
|
70,385
|
|
|
—
|
|
||||
Renewal rights
|
21,053
|
|
|
(18,272
|
)
|
|
19,514
|
|
|
(17,681
|
)
|
||||
Other
|
107,441
|
|
|
(49,217
|
)
|
|
111,633
|
|
|
(49,988
|
)
|
||||
Total
|
$
|
2,196,597
|
|
|
$
|
(470,401
|
)
|
|
$
|
1,777,015
|
|
|
$
|
(421,334
|
)
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Domestic operations
|
$
|
99,373
|
|
|
$
|
337,704
|
|
|
$
|
288,905
|
|
Foreign operations
|
(107,228
|
)
|
|
(250,409
|
)
|
|
341,015
|
|
|||
Income (loss) before income taxes
|
$
|
(7,855
|
)
|
|
$
|
87,295
|
|
|
$
|
629,920
|
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Current:
|
|
|
|
|
|
||||||
Domestic
|
$
|
77,936
|
|
|
$
|
(19,255
|
)
|
|
$
|
57,916
|
|
Foreign
|
41,833
|
|
|
29,882
|
|
|
48,203
|
|
|||
Total current tax expense
|
119,769
|
|
|
10,627
|
|
|
106,119
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
Domestic
|
(77,255
|
)
|
|
(222,427
|
)
|
|
19,991
|
|
|||
Foreign
|
79,984
|
|
|
(101,663
|
)
|
|
43,367
|
|
|||
Total deferred tax expense (benefit)
|
2,729
|
|
|
(324,090
|
)
|
|
63,358
|
|
|||
Income tax expense (benefit)
|
$
|
122,498
|
|
|
$
|
(313,463
|
)
|
|
$
|
169,477
|
|
|
Years Ended December 31,
|
|
||||||||||||
|
2018
|
|
|
2017
|
|
|
2016
|
|
||||||
Income taxes at U.S. corporate tax rate
|
$
|
(1,650
|
)
|
|
|
$
|
30,553
|
|
|
|
$
|
220,472
|
|
|
Increase (decrease) resulting from:
|
|
|
|
|
|
|
|
|
||||||
Change in tax status of U.K. subsidiaries
|
103,281
|
|
|
|
—
|
|
|
|
—
|
|
|
|||
Nondeductible loss on investments managed by MCIM
|
26,552
|
|
|
|
16,231
|
|
|
|
—
|
|
|
|||
Foreign operations
|
4,951
|
|
|
|
37,207
|
|
|
|
4,672
|
|
|
|||
Tax-exempt investment income
|
(18,927
|
)
|
|
|
(41,565
|
)
|
|
|
(39,710
|
)
|
|
|||
TCJA
|
(5,699
|
)
|
|
|
(339,899
|
)
|
|
|
—
|
|
|
|||
Tax credits
|
(3,617
|
)
|
|
|
(10,236
|
)
|
|
|
(13,294
|
)
|
|
|||
Stock based compensation
|
(2,635
|
)
|
|
|
(9,001
|
)
|
|
|
(5,411
|
)
|
|
|||
Other
|
20,242
|
|
|
|
3,247
|
|
|
|
2,748
|
|
|
|||
Income tax expense (benefit)
|
$
|
122,498
|
|
|
|
$
|
(313,463
|
)
|
|
|
$
|
169,477
|
|
|
|
December 31,
|
||||||
(dollars in thousands)
|
2018
|
|
2017
|
||||
Assets:
|
|
|
|
||||
Unpaid losses and loss adjustment expenses
|
$
|
164,497
|
|
|
$
|
144,761
|
|
Unearned premiums recognized for income tax purposes
|
85,952
|
|
|
74,282
|
|
||
Life and annuity benefits
|
78,370
|
|
|
77,945
|
|
||
Net operating loss carryforwards
|
46,662
|
|
|
29,252
|
|
||
Tax credit carryforwards
|
39,877
|
|
|
48,938
|
|
||
Accrued incentive compensation
|
30,308
|
|
|
23,167
|
|
||
Other differences between financial reporting and tax bases
|
39,763
|
|
|
60,995
|
|
||
Total gross deferred tax assets
|
485,429
|
|
|
459,340
|
|
||
Less valuation allowance
|
(36,286
|
)
|
|
(25,225
|
)
|
||
Total gross deferred tax assets, net of allowance
|
449,143
|
|
|
434,115
|
|
||
Liabilities:
|
|
|
|
||||
Investments
|
590,250
|
|
|
603,523
|
|
||
Goodwill and other intangible assets
|
124,953
|
|
|
171,681
|
|
||
Deferred policy acquisition costs
|
89,716
|
|
|
90,826
|
|
||
Other differences between financial reporting and tax bases
|
90,269
|
|
|
73,664
|
|
||
Total gross deferred tax liabilities
|
895,188
|
|
|
939,694
|
|
||
Net deferred tax liability
|
$
|
446,045
|
|
|
$
|
505,579
|
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Net reserves for losses and loss adjustment expenses, beginning of year
|
$
|
8,964,945
|
|
|
$
|
8,108,717
|
|
|
$
|
8,235,288
|
|
Foreign currency movements
|
(69,119
|
)
|
|
110,079
|
|
|
(129,692
|
)
|
|||
Adjusted net reserves for losses and loss adjustment expenses, beginning of year
|
8,895,826
|
|
|
8,218,796
|
|
|
8,105,596
|
|
|||
Incurred losses and loss adjustment expenses:
|
|
|
|
|
|
||||||
Current accident year
|
3,371,699
|
|
|
3,367,223
|
|
|
2,555,902
|
|
|||
Prior accident years
|
(551,040
|
)
|
|
(497,627
|
)
|
|
(493,495
|
)
|
|||
Total incurred losses and loss adjustment expenses
|
2,820,659
|
|
|
2,869,596
|
|
|
2,062,407
|
|
|||
Payments:
|
|
|
|
|
|
||||||
Current accident year
|
666,515
|
|
|
671,112
|
|
|
532,140
|
|
|||
Prior accident years
|
1,835,027
|
|
|
1,513,580
|
|
|
1,529,206
|
|
|||
Total payments
|
2,501,542
|
|
|
2,184,692
|
|
|
2,061,346
|
|
|||
Effect of foreign currency rate changes
|
(500
|
)
|
|
3,752
|
|
|
2,060
|
|
|||
Net reserves for losses and loss adjustment expenses of acquired insurance companies
|
—
|
|
|
57,493
|
|
|
—
|
|
|||
Net reserves for losses and loss adjustment expenses, end of year
|
9,214,443
|
|
|
8,964,945
|
|
|
8,108,717
|
|
|||
Reinsurance recoverable on unpaid losses
|
5,062,036
|
|
|
4,619,336
|
|
|
2,006,945
|
|
|||
Gross reserves for losses and loss adjustment expenses, end of year
|
$
|
14,276,479
|
|
|
$
|
13,584,281
|
|
|
$
|
10,115,662
|
|
|
Ultimate Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
|
|
Total of Incurred-but-Not-Reported Liabilities, Net of Reinsurance
|
|
Cumulative Number of Reported Claims
|
|||||||||||||||||||||||||||||
|
Unaudited
|
|
As of December 31,
|
|
|
|||||||||||||||||||||||||||||
(in thousands)
|
As of December 31,
|
|
|
|
||||||||||||||||||||||||||||||
Accident Year
|
2012
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
December 31, 2018
|
|||||||||||||||||||
2012
|
$
|
1,369,219
|
|
|
$
|
1,609,802
|
|
|
$
|
1,489,026
|
|
|
$
|
1,427,255
|
|
|
$
|
1,395,103
|
|
|
$
|
1,361,513
|
|
|
$
|
1,348,062
|
|
|
$
|
119,585
|
|
|
127
|
|
2013
|
|
|
1,735,667
|
|
|
1,694,879
|
|
|
1,525,750
|
|
|
1,462,652
|
|
|
1,428,733
|
|
|
1,387,804
|
|
|
200,744
|
|
|
87
|
|
|||||||||
2014
|
|
|
|
|
1,862,947
|
|
|
1,695,698
|
|
|
1,627,960
|
|
|
1,570,428
|
|
|
1,522,132
|
|
|
213,237
|
|
|
78
|
|
||||||||||
2015
|
|
|
|
|
|
|
1,783,064
|
|
|
1,710,271
|
|
|
1,585,447
|
|
|
1,530,354
|
|
|
291,364
|
|
|
84
|
|
|||||||||||
2016
|
|
|
|
|
|
|
|
|
1,871,455
|
|
|
1,786,959
|
|
|
1,686,374
|
|
|
378,681
|
|
|
89
|
|
||||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
2,326,966
|
|
|
2,160,771
|
|
|
691,736
|
|
|
116
|
|
|||||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
2,452,747
|
|
|
1,466,264
|
|
|
147
|
|
||||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
12,088,244
|
|
|
|
|
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
|
|
|
|
|
|||||||||||||||||||||||||||||
|
Unaudited
|
|
As of December 31,
|
|
|
|
|
|||||||||||||||||||||||||||
|
As of December 31,
|
|
|
|
|
|
||||||||||||||||||||||||||||
Accident Year
|
2012
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
|
|||||||||||||||||||
2012
|
$
|
233,371
|
|
|
$
|
567,450
|
|
|
$
|
780,067
|
|
|
$
|
937,643
|
|
|
$
|
1,052,859
|
|
|
$
|
1,117,221
|
|
|
$
|
1,150,793
|
|
|
|
|
|
|||
2013
|
|
|
271,439
|
|
|
571,548
|
|
|
779,023
|
|
|
949,370
|
|
|
1,037,635
|
|
|
1,099,985
|
|
|
|
|
|
|||||||||||
2014
|
|
|
|
|
331,626
|
|
|
657,742
|
|
|
894,470
|
|
|
1,062,211
|
|
|
1,167,598
|
|
|
|
|
|
||||||||||||
2015
|
|
|
|
|
|
|
322,633
|
|
|
665,112
|
|
|
876,509
|
|
|
1,040,377
|
|
|
|
|
|
|||||||||||||
2016
|
|
|
|
|
|
|
|
|
372,182
|
|
|
752,606
|
|
|
981,920
|
|
|
|
|
|
||||||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
438,289
|
|
|
990,931
|
|
|
|
|
|
|||||||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
496,812
|
|
|
|
|
|
||||||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
6,928,416
|
|
|
|
|
|
|||||||||||||||
All outstanding liabilities for unpaid losses and loss adjustment expenses before 2012, net of reinsurance
|
|
605,610
|
|
|
|
|
|
|||||||||||||||||||||||||||
Total liabilities for unpaid losses and loss adjustment expenses, net of reinsurance
|
|
$
|
5,765,438
|
|
|
|
|
|
|
Ultimate Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
|
|
Total of Incurred-but-Not-Reported Liabilities, Net of Reinsurance
|
|
|
||||||||||||||||||||||||||||
|
Unaudited
|
|
As of December 31,
|
|
|
||||||||||||||||||||||||||||
(in thousands)
|
As of December 31,
|
|
|
|
|||||||||||||||||||||||||||||
Accident Year
|
2012
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
December 31, 2018
|
|
|
||||||||||||||||
2012
|
$
|
72,903
|
|
|
$
|
550,343
|
|
|
$
|
507,023
|
|
|
$
|
485,374
|
|
|
$
|
457,038
|
|
|
$
|
454,839
|
|
|
$
|
446,722
|
|
|
$
|
62,700
|
|
|
|
2013
|
|
|
586,074
|
|
|
578,994
|
|
|
547,828
|
|
|
534,148
|
|
|
543,963
|
|
|
506,609
|
|
|
78,266
|
|
|
|
|||||||||
2014
|
|
|
|
|
577,123
|
|
|
564,720
|
|
|
536,247
|
|
|
578,688
|
|
|
556,775
|
|
|
121,489
|
|
|
|
||||||||||
2015
|
|
|
|
|
|
|
528,076
|
|
|
514,050
|
|
|
531,854
|
|
|
522,783
|
|
|
197,446
|
|
|
|
|||||||||||
2016
|
|
|
|
|
|
|
|
|
523,958
|
|
|
533,526
|
|
|
531,769
|
|
|
199,881
|
|
|
|
||||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
906,216
|
|
|
939,604
|
|
|
403,107
|
|
|
|
|||||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
760,161
|
|
|
543,670
|
|
|
|
||||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
4,264,423
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
|
|
|
|
|
||||||||||||||||||||||||||||
|
Unaudited
|
|
As of December 31,
|
|
|
|
|
||||||||||||||||||||||||||
|
As of December 31,
|
|
|
|
|
|
|||||||||||||||||||||||||||
Accident Year
|
2012
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
|
||||||||||||||||||
2012
|
$
|
4,049
|
|
|
$
|
64,460
|
|
|
$
|
128,769
|
|
|
$
|
183,943
|
|
|
$
|
231,541
|
|
|
$
|
263,811
|
|
|
$
|
288,772
|
|
|
|
|
|
||
2013
|
|
|
71,503
|
|
|
155,515
|
|
|
209,893
|
|
|
268,761
|
|
|
301,714
|
|
|
331,630
|
|
|
|
|
|
||||||||||
2014
|
|
|
|
|
97,918
|
|
|
158,105
|
|
|
226,883
|
|
|
275,278
|
|
|
312,296
|
|
|
|
|
|
|||||||||||
2015
|
|
|
|
|
|
|
63,924
|
|
|
133,932
|
|
|
207,985
|
|
|
259,366
|
|
|
|
|
|
||||||||||||
2016
|
|
|
|
|
|
|
|
|
79,383
|
|
|
169,877
|
|
|
241,072
|
|
|
|
|
|
|||||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
158,049
|
|
|
359,659
|
|
|
|
|
|
||||||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
87,614
|
|
|
|
|
|
|||||||||||||||
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,880,409
|
|
|
|
|
|
||||||||||||||
All outstanding liabilities for unpaid losses and loss adjustment expenses before 2012, net of reinsurance
|
|
650,117
|
|
|
|
|
|
||||||||||||||||||||||||||
Total liabilities for unpaid losses and loss adjustment expenses, net of reinsurance
|
|
$
|
3,034,131
|
|
|
|
|
|
|
Average Annual Percentage Payout of Incurred Losses by Age (in Years), Net of Reinsurance
|
|||||||||||||||||||
Unaudited
|
1
|
|
2
|
|
3
|
|
4
|
|
5
|
|
6
|
|
7
|
|||||||
Insurance
|
20.3
|
%
|
|
23.1
|
%
|
|
14.7
|
%
|
|
11.4
|
%
|
|
7.3
|
%
|
|
4.6
|
%
|
|
2.5
|
%
|
Reinsurance
|
12.6
|
%
|
|
15.5
|
%
|
|
13.0
|
%
|
|
10.6
|
%
|
|
7.9
|
%
|
|
6.6
|
%
|
|
5.6
|
%
|
(dollars in thousands)
|
December 31, 2018
|
||
Net outstanding liabilities
|
|
||
Insurance segment
|
$
|
5,765,438
|
|
Reinsurance segment
|
3,034,131
|
|
|
Other
|
204,069
|
|
|
Program services
|
2,561
|
|
|
Liabilities for unpaid losses and loss adjustment expenses, net of reinsurance
|
9,006,199
|
|
|
|
|
||
Reinsurance recoverable on unpaid losses
|
|
||
Insurance segment
|
1,965,565
|
|
|
Reinsurance segment
|
415,900
|
|
|
Other
|
166,505
|
|
|
Program services
|
2,514,066
|
|
|
Total reinsurance recoverable on unpaid losses
|
5,062,036
|
|
|
|
|
||
Unallocated loss adjustment expenses
|
239,753
|
|
|
Unamortized discount, net of acquisition fair value adjustments, included in unpaid losses and loss adjustment expenses
|
(31,509
|
)
|
|
|
208,244
|
|
|
Total gross liability for unpaid losses and loss adjustment expenses
|
$
|
14,276,479
|
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Net reserves for A&E losses and loss adjustment expenses, beginning of year
|
$
|
104,661
|
|
|
$
|
111,604
|
|
|
$
|
132,869
|
|
Commutations and other
|
(305
|
)
|
|
6,827
|
|
|
—
|
|
|||
Adjusted net reserves for A&E losses and loss adjustment expenses, beginning of year
|
104,356
|
|
|
118,431
|
|
|
132,869
|
|
|||
Incurred losses and loss adjustment expenses
|
—
|
|
|
659
|
|
|
(5,277
|
)
|
|||
Payments
|
(21,308
|
)
|
|
(14,429
|
)
|
|
(15,988
|
)
|
|||
Net reserves for A&E losses and loss adjustment expenses, end of year
|
83,048
|
|
|
104,661
|
|
|
111,604
|
|
|||
Reinsurance recoverable on unpaid losses
|
164,663
|
|
|
169,866
|
|
|
212,300
|
|
|||
Gross reserves for A&E losses and loss adjustment expenses, end of year
|
$
|
247,711
|
|
|
$
|
274,527
|
|
|
$
|
323,904
|
|
|
December 31,
|
||||||
(dollars in thousands)
|
2018
|
|
2017
|
||||
Life
|
$
|
122,798
|
|
|
$
|
127,208
|
|
Annuities
|
827,773
|
|
|
885,984
|
|
||
Accident and health
|
50,882
|
|
|
58,920
|
|
||
Total
|
$
|
1,001,453
|
|
|
$
|
1,072,112
|
|
|
December 31,
|
||||||
(dollars in thousands)
|
2018
|
|
2017
|
||||
7.125% unsecured senior notes, due September 30, 2019, interest payable semi-annually, net of unamortized discount of $142 in 2018 and $332 in 2017
|
$
|
234,640
|
|
|
$
|
234,411
|
|
6.25% unsecured senior notes, due September 30, 2020, interest payable semi-annually, net of unamortized premium of $17,213 in 2018 and $26,618 in 2017
|
367,213
|
|
|
376,616
|
|
||
5.35% unsecured senior notes, due June 1, 2021, interest payable semi-annually, net of unamortized discount of $499 in 2018 and $706 in 2017
|
249,417
|
|
|
249,176
|
|
||
4.90% unsecured senior notes, due July 1, 2022, interest payable semi-annually, net of unamortized discount of $978 in 2018 and $1,257 in 2017
|
348,864
|
|
|
348,540
|
|
||
3.625% unsecured senior notes, due March 30, 2023, interest payable semi-annually, net of unamortized discount of $855 in 2018 and $1,056 in 2017
|
248,988
|
|
|
248,749
|
|
||
3.50% unsecured senior notes, due November 1, 2027, interest payable semi-annually, net of unamortized discount of $2,298 in 2018 and $2,558 in 2017
|
297,035
|
|
|
296,728
|
|
||
7.35% unsecured senior notes, due August 15, 2034, interest payable semi-annually, net of unamortized discount of $1,074 in 2018 and $1,143 in 2017
|
128,715
|
|
|
128,642
|
|
||
5.0% unsecured senior notes, due March 30, 2043, interest payable semi-annually, net of unamortized discount of $5,431 in 2018 and $5,655 in 2017
|
244,269
|
|
|
244,033
|
|
||
5.0% unsecured senior notes, due April 5, 2046, interest payable semi-annually, net of unamortized discount of $6,664 in 2018 and $6,909 in 2017
|
492,486
|
|
|
492,219
|
|
||
4.30% unsecured senior notes, due November 1, 2047, interest payable semi-annually, net of unamortized discount of $4,278 in 2018 and $4,451 in 2017
|
294,975
|
|
|
294,834
|
|
||
Other debt, at various interest rates ranging from 1.7% to 6.3%
|
102,975
|
|
|
185,282
|
|
||
Senior long-term debt and other debt
|
$
|
3,009,577
|
|
|
$
|
3,099,230
|
|
Years Ending December 31,
|
(dollars in
thousands)
|
||
2019
|
$
|
288,538
|
|
2020
|
356,585
|
|
|
2021
|
281,287
|
|
|
2022
|
356,315
|
|
|
2023
|
250,671
|
|
|
2024 and thereafter
|
1,484,896
|
|
|
Total principal payments
|
$
|
3,018,292
|
|
Net unamortized discount
|
(5,005
|
)
|
|
Net unamortized debt issuance costs
|
(3,710
|
)
|
|
Senior long-term debt and other debt
|
$
|
3,009,577
|
|
|
Years Ended December 31,
|
||||||||||
(in thousands, except per share amounts)
|
2018
|
|
2017
|
|
2016
|
||||||
Net income (loss) to shareholders
(1)
|
$
|
(128,180
|
)
|
|
$
|
395,269
|
|
|
$
|
455,689
|
|
Adjustment of redeemable noncontrolling interests
|
(4,828
|
)
|
|
(33,738
|
)
|
|
(15,472
|
)
|
|||
Adjusted net income (loss) to shareholders
|
$
|
(133,008
|
)
|
|
$
|
361,531
|
|
|
$
|
440,217
|
|
|
|
|
|
|
|
||||||
Basic common shares outstanding
|
13,923
|
|
|
13,964
|
|
|
14,013
|
|
|||
Dilutive potential common shares from options
|
—
|
|
|
1
|
|
|
4
|
|
|||
Dilutive potential common shares from restricted stock units and restricted stock
|
—
|
|
|
41
|
|
|
61
|
|
|||
Diluted shares outstanding
|
13,923
|
|
|
14,006
|
|
|
14,078
|
|
|||
Basic net income (loss) per share
|
$
|
(9.55
|
)
|
|
$
|
25.89
|
|
|
$
|
31.41
|
|
Diluted net income (loss) per share
(2)
|
$
|
(9.55
|
)
|
|
$
|
25.81
|
|
|
$
|
31.27
|
|
(1)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01 and equity securities are no longer classified as available-for-sale with unrealized gains and losses recognized in other comprehensive income, rather, changes in the fair value of equity securities are now recognized in net income. Prior periods have not been restated to conform to the current presentation. See note 1.
|
(2)
|
The impact of restricted stock units and restricted stock of
25 thousand
shares was excluded from the computation of diluted earnings per share for the year ended December 31, 2018 because the effect would have been anti-dilutive.
|
|
Number
of Awards
|
|
Weighted Average
Grant-Date
Fair Value
|
|||
Nonvested awards at January 1, 2018
|
31,518
|
|
|
$
|
808.63
|
|
Granted
|
14,306
|
|
|
1,121.68
|
|
|
Vested
|
(24,535
|
)
|
|
779.65
|
|
|
Forfeited
|
(416
|
)
|
|
914.94
|
|
|
Nonvested awards at December 31, 2018
|
20,873
|
|
|
$
|
1,042.83
|
|
(dollars in thousands)
|
Unrealized
Holding Gains
on Available-for-
Sale Securities
|
|
Foreign
Currency
|
|
Net Actuarial
Pension Loss
|
|
Total
|
||||||||
December 31, 2015
|
$
|
1,472,762
|
|
|
$
|
(72,696
|
)
|
|
$
|
(45,558
|
)
|
|
$
|
1,354,508
|
|
Other comprehensive income (loss) before reclassifications
|
275,696
|
|
|
(11,710
|
)
|
|
(20,700
|
)
|
|
243,286
|
|
||||
Amounts reclassified from accumulated other comprehensive income
|
(33,528
|
)
|
|
—
|
|
|
1,600
|
|
|
(31,928
|
)
|
||||
Total other comprehensive income (loss)
|
242,168
|
|
|
(11,710
|
)
|
|
(19,100
|
)
|
|
211,358
|
|
||||
December 31, 2016
|
$
|
1,714,930
|
|
|
$
|
(84,406
|
)
|
|
$
|
(64,658
|
)
|
|
$
|
1,565,866
|
|
Other comprehensive income before reclassifications
|
787,339
|
|
|
10,403
|
|
|
3,092
|
|
|
800,834
|
|
||||
Amounts reclassified from accumulated other comprehensive income
|
(24,296
|
)
|
|
—
|
|
|
3,167
|
|
|
(21,129
|
)
|
||||
Total other comprehensive income
|
763,043
|
|
|
10,403
|
|
|
6,259
|
|
|
779,705
|
|
||||
December 31, 2017
|
$
|
2,477,973
|
|
|
$
|
(74,003
|
)
|
|
$
|
(58,399
|
)
|
|
$
|
2,345,571
|
|
Cumulative effect of adoption of ASU No. 2016-01
|
(2,597,976
|
)
|
|
2,492
|
|
|
—
|
|
|
(2,595,484
|
)
|
||||
Cumulative effect of adoption of ASU No. 2018-02
|
401,539
|
|
|
1,314
|
|
|
—
|
|
|
402,853
|
|
||||
January 1, 2018
|
281,536
|
|
|
(70,197
|
)
|
|
(58,399
|
)
|
|
152,940
|
|
||||
Other comprehensive loss before reclassifications
|
(241,325
|
)
|
|
(16,455
|
)
|
|
—
|
|
|
(257,780
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income
(1)
|
7,849
|
|
|
—
|
|
|
2,341
|
|
|
10,190
|
|
||||
Total other comprehensive income (loss)
|
(233,476
|
)
|
|
(16,455
|
)
|
|
2,341
|
|
|
(247,590
|
)
|
||||
December 31, 2018
|
$
|
48,060
|
|
|
$
|
(86,652
|
)
|
|
$
|
(56,058
|
)
|
|
$
|
(94,650
|
)
|
(1)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01 and equity securities are no longer classified as available-for-sale with unrealized gains and losses recognized in other comprehensive income, rather, changes in the fair value of equity securities are now recognized in net income. Prior periods have not been restated to conform to the current presentation. See note 1.
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Change in net unrealized gains on available-for-sale investments:
(1)
|
|
|
|
|
|
||||||
Net holding gains (losses) arising during the period
|
$
|
(68,056
|
)
|
|
$
|
372,469
|
|
|
$
|
112,399
|
|
Change in unrealized other-than-temporary impairment losses on fixed maturities arising during the period
|
—
|
|
|
—
|
|
|
6
|
|
|||
Reclassification adjustments for net gains (losses) included in net income (loss)
|
2,086
|
|
|
(10,072
|
)
|
|
(12,462
|
)
|
|||
Change in net unrealized gains on available-for-sale investments
|
(65,970
|
)
|
|
362,397
|
|
|
99,943
|
|
|||
Change in foreign currency translation adjustments
|
1,523
|
|
|
28
|
|
|
1,037
|
|
|||
Change in net actuarial pension loss
|
622
|
|
|
1,284
|
|
|
(4,192
|
)
|
|||
Total
|
$
|
(63,825
|
)
|
|
$
|
363,709
|
|
|
$
|
96,788
|
|
(1)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01 and equity securities are no longer classified as available-for-sale with unrealized gains and losses recognized in other comprehensive income, rather, changes in the fair value of equity securities are now recognized in net income. Prior periods have not been restated to conform to the current presentation. See note 1.
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Unrealized holding gains on available-for-sale investments:
(1)
|
|
|
|
|
|
||||||
Other-than-temporary impairment losses
|
$
|
—
|
|
|
$
|
(7,589
|
)
|
|
$
|
(18,355
|
)
|
Net realized investment gains (losses), excluding other-than-temporary impairment losses
|
(9,935
|
)
|
|
41,957
|
|
|
64,345
|
|
|||
Total before income taxes
|
(9,935
|
)
|
|
34,368
|
|
|
45,990
|
|
|||
Income taxes
|
2,086
|
|
|
(10,072
|
)
|
|
(12,462
|
)
|
|||
Reclassification of unrealized holding gains, net of taxes
|
$
|
(7,849
|
)
|
|
$
|
24,296
|
|
|
$
|
33,528
|
|
|
|
|
|
|
|
||||||
Net actuarial pension loss:
|
|
|
|
|
|
||||||
Underwriting, acquisition and insurance expenses
|
$
|
(2,963
|
)
|
|
$
|
(3,815
|
)
|
|
$
|
(1,951
|
)
|
Income taxes
|
622
|
|
|
648
|
|
|
351
|
|
|||
Reclassification of net actuarial pension loss, net of taxes
|
$
|
(2,341
|
)
|
|
$
|
(3,167
|
)
|
|
$
|
(1,600
|
)
|
(1)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01 and equity securities are no longer classified as available-for-sale with unrealized gains and losses recognized in other comprehensive income, rather, changes in the fair value of equity securities are now recognized in net income. Prior periods have not been restated to conform to the current presentation. See note 1.
|
|
December 31, 2018
|
||||||||||||||
(dollars in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Investments:
|
|
|
|
|
|
|
|
||||||||
Fixed maturities, available-for-sale:
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury securities
|
$
|
—
|
|
|
$
|
246,642
|
|
|
$
|
—
|
|
|
$
|
246,642
|
|
U.S. government-sponsored enterprises
|
—
|
|
|
359,322
|
|
|
—
|
|
|
359,322
|
|
||||
Obligations of states, municipalities and political subdivisions
|
—
|
|
|
4,352,930
|
|
|
—
|
|
|
4,352,930
|
|
||||
Foreign governments
|
—
|
|
|
1,559,604
|
|
|
—
|
|
|
1,559,604
|
|
||||
Commercial mortgage-backed securities
|
—
|
|
|
1,650,199
|
|
|
—
|
|
|
1,650,199
|
|
||||
Residential mortgage-backed securities
|
—
|
|
|
880,172
|
|
|
—
|
|
|
880,172
|
|
||||
Asset-backed securities
|
—
|
|
|
19,408
|
|
|
—
|
|
|
19,408
|
|
||||
Corporate bonds
|
—
|
|
|
974,911
|
|
|
—
|
|
|
974,911
|
|
||||
Total fixed maturities, available-for-sale
|
—
|
|
|
10,043,188
|
|
|
—
|
|
|
10,043,188
|
|
||||
Equity securities:
|
|
|
|
|
|
|
|
||||||||
Insurance, banks and other financial institutions
|
1,876,811
|
|
|
—
|
|
|
53,728
|
|
|
1,930,539
|
|
||||
Industrial, consumer and all other
|
3,790,406
|
|
|
—
|
|
|
—
|
|
|
3,790,406
|
|
||||
Total equity securities
|
5,667,217
|
|
|
—
|
|
|
53,728
|
|
|
5,720,945
|
|
||||
Short-term investments, available-for-sale
|
981,616
|
|
|
96,080
|
|
|
—
|
|
|
1,077,696
|
|
||||
Total investments
|
$
|
6,648,833
|
|
|
$
|
10,139,268
|
|
|
$
|
53,728
|
|
|
$
|
16,841,829
|
|
|
December 31, 2017
|
||||||||||||||
(dollars in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Investments available-for-sale:
|
|
|
|
|
|
|
|
||||||||
Fixed maturities:
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury securities
|
$
|
—
|
|
|
$
|
160,613
|
|
|
$
|
—
|
|
|
$
|
160,613
|
|
U.S. government-sponsored enterprises
|
—
|
|
|
363,520
|
|
|
—
|
|
|
363,520
|
|
||||
Obligations of states, municipalities and political subdivisions
|
—
|
|
|
4,566,562
|
|
|
—
|
|
|
4,566,562
|
|
||||
Foreign governments
|
—
|
|
|
1,489,228
|
|
|
—
|
|
|
1,489,228
|
|
||||
Commercial mortgage-backed securities
|
—
|
|
|
1,234,326
|
|
|
—
|
|
|
1,234,326
|
|
||||
Residential mortgage-backed securities
|
—
|
|
|
856,168
|
|
|
—
|
|
|
856,168
|
|
||||
Asset-backed securities
|
—
|
|
|
34,728
|
|
|
—
|
|
|
34,728
|
|
||||
Corporate bonds
|
—
|
|
|
1,235,525
|
|
|
—
|
|
|
1,235,525
|
|
||||
Total fixed maturities
|
—
|
|
|
9,940,670
|
|
|
—
|
|
|
9,940,670
|
|
||||
Equity securities:
(1)
|
|
|
|
|
|
|
|
||||||||
Insurance, banks and other financial institutions
|
1,934,224
|
|
|
—
|
|
|
168,809
|
|
|
2,103,033
|
|
||||
Industrial, consumer and all other
|
3,864,814
|
|
|
—
|
|
|
—
|
|
|
3,864,814
|
|
||||
Total equity securities
|
5,799,038
|
|
|
—
|
|
|
168,809
|
|
|
5,967,847
|
|
||||
Short-term investments
|
2,065,749
|
|
|
95,225
|
|
|
—
|
|
|
2,160,974
|
|
||||
Total investments available-for-sale
(1)
|
$
|
7,864,787
|
|
|
$
|
10,035,895
|
|
|
$
|
168,809
|
|
|
$
|
18,069,491
|
|
(1)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01 and equity securities are no longer classified as available-for-sale. Prior periods have not been restated to conform to the current presentation. See note 1.
|
(dollars in thousands)
|
2018
|
|
2017
|
||||
Equity securities, beginning of period
|
$
|
168,809
|
|
|
$
|
191,203
|
|
Purchases
|
28,900
|
|
|
56,250
|
|
||
Sales
|
(35,335
|
)
|
|
(26,674
|
)
|
||
Net investment losses on Level 3 investments
(1)
|
(108,646
|
)
|
|
(51,970
|
)
|
||
Transfers into Level 3
|
—
|
|
|
—
|
|
||
Transfers out of Level 3
|
—
|
|
|
—
|
|
||
Equity securities, end of period
|
$
|
53,728
|
|
|
$
|
168,809
|
|
(1)
|
Included in change in fair value of equity securities in the consolidated statements of income (loss) and comprehensive income (loss) for the years ended December 31, 2018 and 2017.
|
|
Year Ended December 31,
|
||||||||||||||
|
2018
|
||||||||||||||
(dollars in thousands)
|
Direct
|
|
Assumed
|
|
Ceded
|
|
Net Premiums
|
||||||||
Underwriting:
|
|
|
|
|
|
|
|
||||||||
Written
|
$
|
4,562,256
|
|
|
$
|
1,236,740
|
|
|
$
|
(1,013,406
|
)
|
|
$
|
4,785,590
|
|
Earned
|
$
|
4,384,562
|
|
|
$
|
1,291,032
|
|
|
$
|
(964,549
|
)
|
|
$
|
4,711,045
|
|
Program services:
|
|
|
|
|
|
|
|
||||||||
Written
|
2,022,548
|
|
|
42,925
|
|
|
(2,063,485
|
)
|
|
1,988
|
|
||||
Earned
|
1,850,656
|
|
|
28,581
|
|
|
(1,878,222
|
)
|
|
1,015
|
|
||||
Consolidated:
|
|
|
|
|
|
|
|
||||||||
Written
|
$
|
6,584,804
|
|
|
$
|
1,279,665
|
|
|
$
|
(3,076,891
|
)
|
|
$
|
4,787,578
|
|
Earned
|
$
|
6,235,218
|
|
|
$
|
1,319,613
|
|
|
$
|
(2,842,771
|
)
|
|
$
|
4,712,060
|
|
|
Year Ended December 31,
|
||||||||||||||
|
2017
|
||||||||||||||
(dollars in thousands)
|
Direct
|
|
Assumed
|
|
Ceded
|
|
Net Premiums
|
||||||||
Underwriting:
|
|
|
|
|
|
|
|
||||||||
Written
|
$
|
3,919,602
|
|
|
$
|
1,333,505
|
|
|
$
|
(835,320
|
)
|
|
$
|
4,417,787
|
|
Earned
|
$
|
3,777,335
|
|
|
$
|
1,286,043
|
|
|
$
|
(815,400
|
)
|
|
$
|
4,247,978
|
|
Program services:
|
|
|
|
|
|
|
|
||||||||
Written
|
252,865
|
|
|
988
|
|
|
(253,853
|
)
|
|
—
|
|
||||
Earned
|
291,287
|
|
|
1,352
|
|
|
(292,639
|
)
|
|
—
|
|
||||
Consolidated:
|
|
|
|
|
|
|
|
||||||||
Written
|
$
|
4,172,467
|
|
|
$
|
1,334,493
|
|
|
$
|
(1,089,173
|
)
|
|
$
|
4,417,787
|
|
Earned
|
$
|
4,068,622
|
|
|
$
|
1,287,395
|
|
|
$
|
(1,108,039
|
)
|
|
$
|
4,247,978
|
|
|
Year Ended December 31,
|
||||||||||||||
|
2016
|
||||||||||||||
(dollars in thousands)
|
Direct
|
|
Assumed
|
|
Ceded
|
|
Net Premiums
|
||||||||
Underwriting:
|
|
|
|
|
|
|
|
||||||||
Written
|
$
|
3,560,635
|
|
|
$
|
1,236,010
|
|
|
$
|
(795,625
|
)
|
|
$
|
4,001,020
|
|
Earned
|
$
|
3,506,687
|
|
|
$
|
1,176,205
|
|
|
$
|
(817,022
|
)
|
|
$
|
3,865,870
|
|
Program services:
|
|
|
|
|
|
|
|
||||||||
Written
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Earned
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Consolidated:
|
|
|
|
|
|
|
|
||||||||
Written
|
$
|
3,560,635
|
|
|
$
|
1,236,010
|
|
|
$
|
(795,625
|
)
|
|
$
|
4,001,020
|
|
Earned
|
$
|
3,506,687
|
|
|
$
|
1,176,205
|
|
|
$
|
(817,022
|
)
|
|
$
|
3,865,870
|
|
|
December 31,
|
||||||
(dollars in thousands)
|
2018
|
|
2017
|
||||
Assets
|
|
|
|
||||
Equity securities: Investment in unconsolidated Markel CATCo Fund
|
$
|
27,547
|
|
|
$
|
168,192
|
|
Other
|
1,082
|
|
|
2,059
|
|
||
Total Assets
|
$
|
28,629
|
|
|
$
|
170,251
|
|
|
|
|
|
||||
Liabilities
|
|
|
|
||||
Note payable
|
$
|
24,875
|
|
|
$
|
62,500
|
|
Other
|
200
|
|
|
168
|
|
||
Total Liabilities
|
$
|
25,075
|
|
|
$
|
62,668
|
|
Years Ending December 31,
|
(dollars in
thousands)
|
||
2019
|
$
|
48,853
|
|
2020
|
41,630
|
|
|
2021
|
37,602
|
|
|
2022
|
31,898
|
|
|
2023
|
28,261
|
|
|
2024 and thereafter
|
117,663
|
|
|
Total
|
$
|
305,907
|
|
Statutory Net Income (Loss)
|
|
|
|
|
|
||||||
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
United States
|
$
|
414,957
|
|
|
$
|
312,828
|
|
|
$
|
249,176
|
|
United Kingdom
|
$
|
40,203
|
|
|
$
|
(25,785
|
)
|
|
$
|
78,033
|
|
Bermuda
|
$
|
(131,411
|
)
|
|
$
|
(78,070
|
)
|
|
$
|
132,442
|
|
Other
|
$
|
(5,193
|
)
|
|
$
|
(4,812
|
)
|
|
$
|
(965
|
)
|
|
Year Ended December 31, 2018
|
||||||||||||||||||||||
(dollars in thousands)
|
Insurance
|
|
Reinsurance
|
|
Investing
|
|
Markel Ventures
|
|
Other
(1)
|
|
Consolidated
|
||||||||||||
Gross premium volume
|
$
|
4,749,166
|
|
|
$
|
1,050,870
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,064,433
|
|
|
$
|
7,864,469
|
|
Net written premiums
|
3,904,773
|
|
|
882,285
|
|
|
—
|
|
|
—
|
|
|
520
|
|
|
4,787,578
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Earned premiums
|
3,783,939
|
|
|
928,574
|
|
|
—
|
|
|
—
|
|
|
(453
|
)
|
|
4,712,060
|
|
||||||
Losses and loss adjustment expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Current accident year
|
(2,596,057
|
)
|
|
(775,642
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,371,699
|
)
|
||||||
Prior accident years
|
502,260
|
|
|
42,982
|
|
|
—
|
|
|
—
|
|
|
5,742
|
|
|
550,984
|
|
||||||
Amortization of policy acquisition costs
|
(770,183
|
)
|
|
(239,120
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,009,303
|
)
|
||||||
Other operating expenses
|
(691,186
|
)
|
|
(75,081
|
)
|
|
—
|
|
|
—
|
|
|
(1,941
|
)
|
|
(768,208
|
)
|
||||||
Underwriting profit (loss)
|
228,773
|
|
|
(118,287
|
)
|
|
—
|
|
|
—
|
|
|
3,348
|
|
|
113,834
|
|
||||||
Net investment income
|
—
|
|
|
—
|
|
|
433,702
|
|
|
513
|
|
|
—
|
|
|
434,215
|
|
||||||
Net investment losses
(2)
|
—
|
|
|
—
|
|
|
(437,596
|
)
|
|
—
|
|
|
—
|
|
|
(437,596
|
)
|
||||||
Products revenues
|
—
|
|
|
—
|
|
|
—
|
|
|
1,497,523
|
|
|
—
|
|
|
1,497,523
|
|
||||||
Services and other revenues
|
—
|
|
|
—
|
|
|
—
|
|
|
414,542
|
|
|
220,541
|
|
|
635,083
|
|
||||||
Products expenses
(3)
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,413,248
|
)
|
|
—
|
|
|
(1,413,248
|
)
|
||||||
Services and other expenses
(3)
|
—
|
|
|
—
|
|
|
—
|
|
|
(366,739
|
)
|
|
(108,185
|
)
|
|
(474,924
|
)
|
||||||
Amortization of intangible assets
(4)
|
—
|
|
|
—
|
|
|
—
|
|
|
(40,208
|
)
|
|
(75,722
|
)
|
|
(115,930
|
)
|
||||||
Impairment of goodwill and intangible assets
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,904
|
)
|
|
(184,294
|
)
|
|
(199,198
|
)
|
||||||
Segment profit (loss)
|
$
|
228,773
|
|
|
$
|
(118,287
|
)
|
|
$
|
(3,894
|
)
|
|
$
|
77,479
|
|
|
$
|
(144,312
|
)
|
|
$
|
39,759
|
|
Interest expense
|
|
|
|
|
|
|
|
|
|
|
(154,212
|
)
|
|||||||||||
Net foreign exchange gains
|
|
|
|
|
|
|
|
|
|
|
106,598
|
|
|||||||||||
Loss before income taxes
|
|
|
|
|
|
|
|
|
|
|
$
|
(7,855
|
)
|
||||||||||
U.S. GAAP combined ratio
(5)
|
94
|
%
|
|
113
|
%
|
|
|
|
|
|
NM
|
|
(6)
|
98
|
%
|
(1)
|
Other represents the total profit (loss) attributable to the Company's operations that are not included in a reportable segment as well as any amortization of intangible assets and impairment of goodwill and intangible assets that are not allocated to a reportable segment.
|
(2)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01. As a result, the change in fair value of equity securities is no longer recognized in other comprehensive income; rather, all changes in the fair value of equity securities are now recognized in net investment losses within net income. Prior periods have not been restated to conform to the current presentation. See note 1.
|
(3)
|
Products expenses and services and other expenses for the Markel Ventures segment include depreciation expense of
$52.2 million
for the year ended
December 31, 2018
.
|
(4)
|
Segment profit for the Markel Ventures segment includes amortization of intangible assets attributable to Markel Ventures. Amortization of intangible assets is not allocated to any other reportable segments.
|
(5)
|
The U.S. GAAP combined ratio is a measure of underwriting performance and represents the relationship of incurred losses, loss adjustment expenses and underwriting, acquisition and insurance expenses to earned premiums.
|
(6)
|
NM - Ratio is not meaningful
|
|
Year Ended December 31, 2017
|
||||||||||||||||||||||
(dollars in thousands)
|
Insurance
|
|
Reinsurance
|
|
Investing
|
|
Markel Ventures
|
|
Other
(1)
|
|
Consolidated
|
||||||||||||
Gross premium volume
|
$
|
4,141,201
|
|
|
$
|
1,112,101
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
253,658
|
|
|
$
|
5,506,960
|
|
Net written premiums
|
3,439,796
|
|
|
978,160
|
|
|
—
|
|
|
—
|
|
|
(169
|
)
|
|
4,417,787
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Earned premiums
|
3,314,033
|
|
|
934,114
|
|
|
|
|
|
|
|
|
(169
|
)
|
|
4,247,978
|
|
||||||
Losses and loss adjustment expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Current accident year
|
(2,442,344
|
)
|
|
(924,879
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,367,223
|
)
|
||||||
Prior accident years
|
500,627
|
|
|
(7,803
|
)
|
|
—
|
|
|
—
|
|
|
8,638
|
|
|
501,462
|
|
||||||
Amortization of policy acquisition costs
|
(675,470
|
)
|
|
(218,883
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(894,353
|
)
|
||||||
Other operating expenses
|
(611,749
|
)
|
|
(82,567
|
)
|
|
—
|
|
|
—
|
|
|
(795
|
)
|
|
(695,111
|
)
|
||||||
Underwriting profit (loss)
|
85,097
|
|
|
(300,018
|
)
|
|
—
|
|
|
—
|
|
|
7,674
|
|
|
(207,247
|
)
|
||||||
Net investment income
|
—
|
|
|
—
|
|
|
405,377
|
|
|
332
|
|
|
|
|
|
405,709
|
|
||||||
Net investment losses
(2)
|
—
|
|
|
—
|
|
|
(5,303
|
)
|
|
—
|
|
|
|
|
|
(5,303
|
)
|
||||||
Products revenues
|
—
|
|
|
—
|
|
|
—
|
|
|
951,012
|
|
|
—
|
|
|
951,012
|
|
||||||
Services and other revenues
|
—
|
|
|
—
|
|
|
—
|
|
|
382,268
|
|
|
79,995
|
|
|
462,263
|
|
||||||
Products expenses
(3)
|
—
|
|
|
—
|
|
|
—
|
|
|
(850,449
|
)
|
|
—
|
|
|
(850,449
|
)
|
||||||
Services and other expenses
(3)
|
—
|
|
|
—
|
|
|
—
|
|
|
(336,484
|
)
|
|
(122,137
|
)
|
|
(458,621
|
)
|
||||||
Amortization of intangible assets
(4)
|
—
|
|
|
—
|
|
|
—
|
|
|
(31,429
|
)
|
|
(49,329
|
)
|
|
(80,758
|
)
|
||||||
Segment profit (loss)
|
$
|
85,097
|
|
|
$
|
(300,018
|
)
|
|
$
|
400,074
|
|
|
$
|
115,250
|
|
|
$
|
(83,797
|
)
|
|
$
|
216,606
|
|
Interest expense
|
|
|
|
|
|
|
|
|
|
|
(132,451
|
)
|
|||||||||||
Net foreign exchange gains
|
|
|
|
|
|
|
|
|
|
|
3,140
|
|
|||||||||||
Income before income taxes
|
|
|
|
|
|
|
|
|
|
|
$
|
87,295
|
|
||||||||||
U.S. GAAP combined ratio
(5)
|
97
|
%
|
|
132
|
%
|
|
|
|
|
|
NM
|
|
(6)
|
105
|
%
|
(1)
|
Other represents the total profit (loss) attributable to the Company's operations that are not included in a reportable segment as well as any amortization of intangible assets that is not allocated to a reportable segment.
|
(2)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01. As a result, the change in fair value of equity securities is no longer recognized in other comprehensive income; rather, all changes in the fair value of equity securities are now recognized in net investment losses within net income. Prior periods have not been restated to conform to the current presentation. See note 1.
|
(3)
|
Products expenses and services and other expenses for the Markel Ventures segment include depreciation expense of
$41.7 million
for the year ended
December 31, 2017
.
|
(4)
|
Segment profit for the Markel Ventures segment includes amortization of intangible assets attributable to Markel Ventures. Amortization of intangible assets is not allocated to any other reportable segments.
|
(5)
|
The U.S. GAAP combined ratio is a measure of underwriting performance and represents the relationship of incurred losses, loss adjustment expenses and underwriting, acquisition and insurance expenses to earned premiums.
|
(6)
|
NM - Ratio is not meaningful
|
|
Year Ended December 31, 2016
|
||||||||||||||||||||||
(dollars in thousands)
|
Insurance
|
|
Reinsurance
|
|
Investing
|
|
Markel Ventures
|
|
Other
(1)
|
|
Consolidated
|
||||||||||||
Gross premium volume
|
$
|
3,755,081
|
|
|
$
|
1,041,055
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
509
|
|
|
$
|
4,796,645
|
|
Net written premiums
|
3,101,657
|
|
|
898,728
|
|
|
—
|
|
|
—
|
|
|
635
|
|
|
4,001,020
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Earned premiums
|
3,028,844
|
|
|
836,264
|
|
|
—
|
|
|
—
|
|
|
762
|
|
|
3,865,870
|
|
||||||
Losses and loss adjustment expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Current accident year
|
(2,009,426
|
)
|
|
(546,476
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,555,902
|
)
|
||||||
Prior accident years
|
369,594
|
|
|
125,514
|
|
|
—
|
|
|
—
|
|
|
10,050
|
|
|
505,158
|
|
||||||
Amortization of policy acquisition costs
|
(592,766
|
)
|
|
(189,455
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(782,221
|
)
|
||||||
Other operating expenses
|
(597,201
|
)
|
|
(116,642
|
)
|
|
—
|
|
|
—
|
|
|
(1,061
|
)
|
|
(714,904
|
)
|
||||||
Underwriting profit
|
199,045
|
|
|
109,205
|
|
|
—
|
|
|
—
|
|
|
9,751
|
|
|
318,001
|
|
||||||
Net investment income
|
—
|
|
|
—
|
|
|
373,121
|
|
|
109
|
|
|
|
|
|
373,230
|
|
||||||
Net investment gains
(2)
|
—
|
|
|
—
|
|
|
65,147
|
|
|
—
|
|
|
|
|
|
65,147
|
|
||||||
Products revenues
|
—
|
|
|
—
|
|
|
—
|
|
|
885,473
|
|
|
—
|
|
|
885,473
|
|
||||||
Services and other revenues
|
—
|
|
|
—
|
|
|
—
|
|
|
328,976
|
|
|
93,330
|
|
|
422,306
|
|
||||||
Products expenses
(3)
|
—
|
|
|
—
|
|
|
—
|
|
|
(755,591
|
)
|
|
—
|
|
|
(755,591
|
)
|
||||||
Services and other expenses
(3)
|
—
|
|
|
—
|
|
|
—
|
|
|
(297,841
|
)
|
|
(118,300
|
)
|
|
(416,141
|
)
|
||||||
Amortization of intangible assets
(4)
|
—
|
|
|
—
|
|
|
—
|
|
|
(29,105
|
)
|
|
(39,428
|
)
|
|
(68,533
|
)
|
||||||
Impairment of goodwill and intangible assets
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,723
|
)
|
|
—
|
|
|
(18,723
|
)
|
||||||
Segment profit (loss)
|
$
|
199,045
|
|
|
$
|
109,205
|
|
|
$
|
438,268
|
|
|
$
|
113,298
|
|
|
$
|
(54,647
|
)
|
|
$
|
805,169
|
|
Interest expense
|
|
|
|
|
|
|
|
|
|
|
(129,896
|
)
|
|||||||||||
Loss on early extinguishment of debt
|
|
|
|
|
|
|
|
|
|
|
(44,100
|
)
|
|||||||||||
Net foreign exchange losses
|
|
|
|
|
|
|
|
|
|
|
(1,253
|
)
|
|||||||||||
Income before income taxes
|
|
|
|
|
|
|
|
|
|
|
$
|
629,920
|
|
||||||||||
U.S. GAAP combined ratio
(5)
|
93
|
%
|
|
87
|
%
|
|
|
|
|
|
NM
|
|
(6)
|
92
|
%
|
(1)
|
Other represents the total profit (loss) attributable to the Company's operations that are not included in a reportable segment as well as any amortization of intangible assets and impairment of goodwill and intangible assets that are not allocated to a reportable segment.
|
(2)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01. As a result, the change in fair value of equity securities is no longer recognized in other comprehensive income; rather, all changes in the fair value of equity securities are now recognized in net investment gains within net income. Prior periods have not been restated to conform to the current presentation. See note 1.
|
(3)
|
Products expenses and services and other expenses for the Markel Ventures segment include depreciation expense of
$35.5 million
for the year ended
December 31, 2016
.
|
(4)
|
Segment profit for the Markel Ventures segment includes amortization of intangible assets attributable to Markel Ventures. Amortization of intangible assets is not allocated to any other reportable segments.
|
(5)
|
The U.S. GAAP combined ratio is a measure of underwriting performance and represents the relationship of incurred losses, loss adjustment expenses and underwriting, acquisition and insurance expenses to earned premiums.
|
(6)
|
NM - Ratio is not meaningful
|
(dollars in thousands)
|
Deferred Policy
Acquisition Costs
|
|
Unearned
Premiums
|
|
Unpaid Losses and
Loss Adjustment Expenses
|
||||||
December 31, 2018
|
|
|
|
|
|
||||||
Insurance segment
|
$
|
315,363
|
|
|
$
|
2,031,140
|
|
|
$
|
7,947,772
|
|
Reinsurance segment
|
159,150
|
|
|
630,435
|
|
|
3,425,751
|
|
|||
Other
|
—
|
|
|
—
|
|
|
386,329
|
|
|||
Total Underwriting
|
474,513
|
|
|
2,661,575
|
|
|
11,759,852
|
|
|||
Program services
|
—
|
|
|
949,453
|
|
|
2,516,627
|
|
|||
Total
|
$
|
474,513
|
|
|
$
|
3,611,028
|
|
|
$
|
14,276,479
|
|
December 31, 2017
|
|
|
|
|
|
||||||
Insurance segment
|
$
|
286,780
|
|
|
$
|
1,855,331
|
|
|
$
|
7,711,510
|
|
Reinsurance segment
|
178,789
|
|
|
690,565
|
|
|
3,248,070
|
|
|||
Other
|
—
|
|
|
—
|
|
|
429,270
|
|
|||
Total Underwriting
|
465,569
|
|
|
2,545,896
|
|
|
11,388,850
|
|
|||
Program services
|
—
|
|
|
762,883
|
|
|
2,195,431
|
|
|||
Total
|
$
|
465,569
|
|
|
$
|
3,308,779
|
|
|
$
|
13,584,281
|
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Insurance segment:
|
|
|
|
|
|
||||||
General liability
|
$
|
889,543
|
|
|
$
|
764,956
|
|
|
$
|
675,199
|
|
Professional liability
|
701,867
|
|
|
628,878
|
|
|
600,607
|
|
|||
Property
|
369,116
|
|
|
365,513
|
|
|
357,320
|
|
|||
Marine and energy
|
376,747
|
|
|
312,282
|
|
|
277,608
|
|
|||
Personal lines
|
374,543
|
|
|
382,761
|
|
|
374,175
|
|
|||
Programs
|
288,398
|
|
|
273,954
|
|
|
263,783
|
|
|||
Workers compensation
|
329,690
|
|
|
319,679
|
|
|
301,126
|
|
|||
Other products
|
454,035
|
|
|
266,010
|
|
|
179,026
|
|
|||
Total Insurance
|
3,783,939
|
|
|
3,314,033
|
|
|
3,028,844
|
|
|||
Reinsurance segment:
|
|
|
|
|
|
||||||
Property
|
233,195
|
|
|
321,178
|
|
|
288,771
|
|
|||
Casualty
|
417,601
|
|
|
351,457
|
|
|
327,383
|
|
|||
Auto
|
12,422
|
|
|
28,700
|
|
|
65,363
|
|
|||
Other products
|
265,356
|
|
|
232,779
|
|
|
154,747
|
|
|||
Total Reinsurance
|
928,574
|
|
|
934,114
|
|
|
836,264
|
|
|||
Other
|
(453
|
)
|
|
(169
|
)
|
|
762
|
|
|||
Total earned premiums
|
$
|
4,712,060
|
|
|
$
|
4,247,978
|
|
|
$
|
3,865,870
|
|
|
Years Ended December 31,
|
|||||||||||||||||||
(dollars in thousands)
|
2018
|
|
% of
Total
|
|
2017
|
|
% of
Total
|
|
2016
|
|
% of
Total
|
|||||||||
United States
|
$
|
4,587,486
|
|
|
79
|
%
|
|
$
|
4,163,753
|
|
|
79
|
%
|
|
$
|
3,691,840
|
|
|
77
|
%
|
United Kingdom
|
471,818
|
|
|
8
|
|
|
374,941
|
|
|
7
|
|
|
358,348
|
|
|
7
|
|
|||
Canada
|
127,546
|
|
|
2
|
|
|
132,018
|
|
|
3
|
|
|
125,444
|
|
|
3
|
|
|||
Other countries
|
612,146
|
|
|
11
|
|
|
582,395
|
|
|
11
|
|
|
621,013
|
|
|
13
|
|
|||
Total Underwriting
|
5,798,996
|
|
|
100
|
%
|
|
5,253,107
|
|
|
100
|
%
|
|
4,796,645
|
|
|
100
|
%
|
|||
United States - Program services
|
2,065,473
|
|
|
|
|
253,853
|
|
|
|
|
—
|
|
|
|
||||||
Total
|
$
|
7,864,469
|
|
|
|
|
$
|
5,506,960
|
|
|
|
|
$
|
4,796,645
|
|
|
|
|
December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Segment assets:
|
|
|
|
|
|
||||||
Investing
|
$
|
19,100,790
|
|
|
$
|
20,317,160
|
|
|
$
|
19,029,584
|
|
Underwriting
|
6,451,984
|
|
|
6,828,048
|
|
|
5,397,696
|
|
|||
Markel Ventures
|
2,124,506
|
|
|
1,900,728
|
|
|
1,206,223
|
|
|||
Total segment assets
|
27,677,280
|
|
|
29,045,936
|
|
|
25,633,503
|
|
|||
Other operations
|
5,628,983
|
|
|
3,759,080
|
|
|
241,796
|
|
|||
Total assets
|
$
|
33,306,263
|
|
|
$
|
32,805,016
|
|
|
$
|
25,875,299
|
|
|
Years Ended December 31,
|
||||||||||||||||||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||||||||||||||||||||||||||
(dollars in thousands)
|
Markel Ventures
|
|
Other
|
|
Total
|
|
Markel Ventures
|
|
Other
|
|
Total
|
|
Markel Ventures
|
|
Other
|
|
Total
|
||||||||||||||||||
Products
|
$
|
1,452,332
|
|
|
$
|
—
|
|
|
$
|
1,452,332
|
|
|
$
|
902,739
|
|
|
$
|
—
|
|
|
$
|
902,739
|
|
|
$
|
843,140
|
|
|
$
|
—
|
|
|
$
|
843,140
|
|
Services
|
367,572
|
|
|
33,236
|
|
|
400,808
|
|
|
339,430
|
|
|
34,746
|
|
|
374,176
|
|
|
288,726
|
|
|
34,984
|
|
|
323,710
|
|
|||||||||
Investment management
|
—
|
|
|
91,527
|
|
|
91,527
|
|
|
—
|
|
|
28,740
|
|
|
28,740
|
|
|
—
|
|
|
56,455
|
|
|
56,455
|
|
|||||||||
Total revenues from contracts with customers
|
1,819,904
|
|
|
124,763
|
|
|
1,944,667
|
|
|
1,242,169
|
|
|
63,486
|
|
|
1,305,655
|
|
|
1,131,866
|
|
|
91,439
|
|
|
1,223,305
|
|
|||||||||
Program services
|
—
|
|
|
94,118
|
|
|
94,118
|
|
|
—
|
|
|
14,487
|
|
|
14,487
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Other
|
92,161
|
|
|
1,660
|
|
|
93,821
|
|
|
91,111
|
|
|
2,022
|
|
|
93,133
|
|
|
82,583
|
|
|
1,891
|
|
|
84,474
|
|
|||||||||
Total
|
$
|
1,912,065
|
|
|
$
|
220,541
|
|
|
$
|
2,132,606
|
|
|
$
|
1,333,280
|
|
|
$
|
79,995
|
|
|
$
|
1,413,275
|
|
|
$
|
1,214,449
|
|
|
$
|
93,330
|
|
|
$
|
1,307,779
|
|
(dollars in thousands)
|
December 31, 2018
|
|
December 31, 2017
|
||||
Receivables
|
$
|
247,532
|
|
|
$
|
176,865
|
|
Customer deposits
|
$
|
48,238
|
|
|
$
|
61,546
|
|
|
Years Ended December 31,
|
||||||
(dollars in thousands)
|
2018
|
|
2017
|
||||
Change in projected benefit obligation:
|
|
|
|
||||
Projected benefit obligation at beginning of period
|
$
|
199,117
|
|
|
$
|
178,618
|
|
Interest cost
|
4,815
|
|
|
5,016
|
|
||
Benefits paid
|
(8,045
|
)
|
|
(5,644
|
)
|
||
Actuarial gain (loss)
|
(15,853
|
)
|
|
4,985
|
|
||
Effect of foreign currency rate changes
|
(8,537
|
)
|
|
16,142
|
|
||
Projected benefit obligation at end of year
|
$
|
171,497
|
|
|
$
|
199,117
|
|
Change in plan assets:
|
|
|
|
||||
Fair value of plan assets at beginning of period
|
$
|
206,570
|
|
|
$
|
175,644
|
|
Actual gain (loss) on plan assets
|
(5,683
|
)
|
|
16,902
|
|
||
Employer contributions
|
3,368
|
|
|
3,393
|
|
||
Benefits paid
|
(8,045
|
)
|
|
(5,644
|
)
|
||
Effect of foreign currency rate changes
|
(9,246
|
)
|
|
16,275
|
|
||
Fair value of plan assets at end of year
|
$
|
186,964
|
|
|
$
|
206,570
|
|
Funded status of the plan
|
$
|
15,467
|
|
|
$
|
7,453
|
|
Net actuarial pension loss
|
$
|
74,604
|
|
|
$
|
77,567
|
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Net actuarial gain (loss)
|
$
|
—
|
|
|
$
|
3,728
|
|
|
$
|
(25,243
|
)
|
Amortization of net actuarial loss
|
2,963
|
|
|
3,815
|
|
|
1,951
|
|
|||
Tax benefit (expense)
|
(622
|
)
|
|
(1,284
|
)
|
|
4,192
|
|
|||
Total other comprehensive income (loss)
|
$
|
2,341
|
|
|
$
|
6,259
|
|
|
$
|
(19,100
|
)
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Components of net periodic benefit income (loss):
|
|
|
|
|
|
||||||
Interest cost
|
$
|
4,815
|
|
|
$
|
5,016
|
|
|
$
|
6,113
|
|
Expected return on plan assets
|
(8,782
|
)
|
|
(8,189
|
)
|
|
(9,124
|
)
|
|||
Amortization of net actuarial pension loss
|
2,963
|
|
|
3,815
|
|
|
1,951
|
|
|||
Net periodic benefit income (loss)
|
$
|
(1,004
|
)
|
|
$
|
642
|
|
|
$
|
(1,060
|
)
|
Weighted average assumptions as of December 31:
|
|
|
|
|
|
||||||
Discount rate
|
3.0
|
%
|
|
2.6
|
%
|
|
2.7
|
%
|
|||
Expected return on plan assets
|
4.5
|
%
|
|
4.5
|
%
|
|
4.5
|
%
|
|||
Rate of compensation increase
|
3.0
|
%
|
|
3.0
|
%
|
|
3.0
|
%
|
|
December 31,
|
||||||
(dollars in thousands)
|
2018
|
|
2017
|
||||
Plan assets:
|
|
|
|
||||
Fixed maturity index funds
|
$
|
102,047
|
|
|
$
|
110,936
|
|
Equity security index funds
|
84,909
|
|
|
95,452
|
|
||
Cash and cash equivalents
|
8
|
|
|
182
|
|
||
Total
|
$
|
186,964
|
|
|
$
|
206,570
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(dollars in thousands)
|
||||||
ASSETS
|
|
|
|
||||
Investments, at estimated fair value:
|
|
|
|
||||
Fixed maturities, available-for-sale (amortized cost of $717,666 in 2018 and $533,183 in 2017)
|
$
|
717,681
|
|
|
$
|
532,438
|
|
Equity securities, available-for-sale (cost of $402,694 in 2017)
|
—
|
|
|
646,060
|
|
||
Equity securities (cost of $1,117,363 in 2018)
(1)
|
1,175,120
|
|
|
—
|
|
||
Short-term investments, available-for-sale (estimated fair value approximates cost)
|
451,499
|
|
|
1,159,323
|
|
||
Total Investments
|
2,344,300
|
|
|
2,337,821
|
|
||
Cash and cash equivalents
|
263,043
|
|
|
349,347
|
|
||
Restricted cash and cash equivalents
|
3,177
|
|
|
1,419
|
|
||
Receivables
|
19,295
|
|
|
18,684
|
|
||
Investments in consolidated subsidiaries
|
10,697,605
|
|
|
9,510,215
|
|
||
Notes receivable from subsidiaries
|
160,111
|
|
|
140,110
|
|
||
Income taxes receivable
|
21,174
|
|
|
5,704
|
|
||
Other assets
|
135,722
|
|
|
121,233
|
|
||
Total Assets
|
$
|
13,644,427
|
|
|
$
|
12,484,533
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
||||
Senior long-term debt
|
$
|
2,539,389
|
|
|
$
|
2,537,331
|
|
Notes payable to subsidiaries
(2)
|
1,895,000
|
|
|
285,000
|
|
||
Net deferred tax liability
|
64,564
|
|
|
84,507
|
|
||
Other liabilities
|
64,820
|
|
|
73,547
|
|
||
Total Liabilities
|
4,563,773
|
|
|
2,980,385
|
|
||
Total Shareholders' Equity
|
9,080,654
|
|
|
9,504,148
|
|
||
Total Liabilities and Shareholders' Equity
|
$
|
13,644,427
|
|
|
$
|
12,484,533
|
|
(1)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01. As a result, equity securities are no longer classified as available-for-sale with unrealized gains and losses recognized in other comprehensive income; rather, all changes in the fair value of equity securities are now recognized in net income. Prior periods have not been restated to conform to the current presentation. See note 1.
|
(2)
|
In December 2018, Markel Corporation purchased Markel Global Reinsurance Company, an indirectly owned subsidiary of Markel Corporation, from Alterra USA Holdings Limited, another indirectly owned subsidiary of Markel Corporation, by issuing a
$1.4 billion
note payable to subsidiary.
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(dollars in thousands)
|
||||||||||
REVENUES
|
|
|
|
|
|
||||||
Net investment income
|
$
|
32,631
|
|
|
$
|
21,076
|
|
|
$
|
9,561
|
|
Dividends on common stock of consolidated subsidiaries
|
749,171
|
|
|
895,920
|
|
|
349,622
|
|
|||
Net investment gains (losses):
|
|
|
|
|
|
||||||
Net realized investment gains (losses), including other-than-temporary impairment losses
|
(3,341
|
)
|
|
3,383
|
|
|
1,068
|
|
|||
Change in fair value of equity securities
(1)
|
(110,356
|
)
|
|
—
|
|
|
—
|
|
|||
Net investment gains (losses)
|
(113,697
|
)
|
|
3,383
|
|
|
1,068
|
|
|||
Total Revenues
|
668,105
|
|
|
920,379
|
|
|
360,251
|
|
|||
EXPENSES
|
|
|
|
|
|
||||||
Services and other expenses
|
6,532
|
|
|
11,708
|
|
|
13,076
|
|
|||
Interest expense
|
145,681
|
|
|
122,151
|
|
|
116,013
|
|
|||
Net foreign exchange gains
|
(3,391
|
)
|
|
—
|
|
|
—
|
|
|||
Loss on early extinguishment of debt
|
—
|
|
|
—
|
|
|
44,100
|
|
|||
Total Expenses
|
148,822
|
|
|
133,859
|
|
|
173,189
|
|
|||
Income Before Equity in Undistributed Earnings of Consolidated Subsidiaries and Income Taxes
|
519,283
|
|
|
786,520
|
|
|
187,062
|
|
|||
Equity in undistributed earnings of consolidated subsidiaries
|
(696,045
|
)
|
|
(469,365
|
)
|
|
196,615
|
|
|||
Income tax benefit
|
(48,582
|
)
|
|
(78,114
|
)
|
|
(72,012
|
)
|
|||
Net Income (Loss) to Shareholders
|
$
|
(128,180
|
)
|
|
$
|
395,269
|
|
|
$
|
455,689
|
|
OTHER COMPREHENSIVE INCOME (LOSS) TO SHAREHOLDERS
|
|
|
|
|
|
||||||
Change in net unrealized gains on available-for-sale investments, net of taxes:
|
|
|
|
|
|
||||||
Net holding gains (losses) arising during the period
|
$
|
(1,492
|
)
|
|
$
|
52,277
|
|
|
$
|
37,045
|
|
Consolidated subsidiaries' net holding gains (losses) arising during the period
|
(239,833
|
)
|
|
735,062
|
|
|
238,616
|
|
|||
Reclassification adjustments for net gains (losses) included in net income (loss) to shareholders
|
2,564
|
|
|
(1,513
|
)
|
|
(523
|
)
|
|||
Consolidated subsidiaries' reclassification adjustments for net gains included in net income (loss) to shareholders
|
5,285
|
|
|
(22,783
|
)
|
|
(32,970
|
)
|
|||
Change in net unrealized gains on available-for-sale investments, net of taxes
|
(233,476
|
)
|
|
763,043
|
|
|
242,168
|
|
|||
Change in foreign currency translation adjustments, net of taxes
|
—
|
|
|
(2,260
|
)
|
|
(1,326
|
)
|
|||
Consolidated subsidiaries' change in foreign currency translation adjustments, net of taxes
|
(16,455
|
)
|
|
12,663
|
|
|
(10,384
|
)
|
|||
Consolidated subsidiaries' change in net actuarial pension loss, net of taxes
|
2,341
|
|
|
6,259
|
|
|
(19,100
|
)
|
|||
Total Other Comprehensive Income (Loss) to Shareholders
|
(247,590
|
)
|
|
779,705
|
|
|
211,358
|
|
|||
Comprehensive Income (Loss) to Shareholders
|
$
|
(375,770
|
)
|
|
$
|
1,174,974
|
|
|
$
|
667,047
|
|
(1)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01. As a result, equity securities are no longer classified as available-for-sale with unrealized gains and losses recognized in other comprehensive income; rather, all changes in the fair value of equity securities are now recognized in net income. Prior periods have not been restated to conform to the current presentation. See note 1.
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(dollars in thousands)
|
||||||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
||||||
Net income (loss) to shareholders
|
$
|
(128,180
|
)
|
|
$
|
395,269
|
|
|
$
|
455,689
|
|
Adjustments to reconcile net income (loss) to shareholders to net cash provided (used) by operating activities
|
3,637
|
|
|
(166,132
|
)
|
|
(120,564
|
)
|
|||
Net Cash Provided (Used) By Operating Activities
|
(124,543
|
)
|
|
229,137
|
|
|
335,125
|
|
|||
INVESTING ACTIVITIES
|
|
|
|
|
|
||||||
Proceeds from sales of fixed maturities and equity securities
|
204,478
|
|
|
20,562
|
|
|
1,831
|
|
|||
Proceeds from maturities, calls and prepayments of fixed maturities
|
34,560
|
|
|
64,705
|
|
|
11,960
|
|
|||
Cost of fixed maturities and equity securities purchased
|
(26,336
|
)
|
|
(72,910
|
)
|
|
(29,110
|
)
|
|||
Net change in short-term investments
|
930,876
|
|
|
649,181
|
|
|
(731,389
|
)
|
|||
Return of capital from subsidiaries
|
12,712
|
|
|
45,225
|
|
|
21,021
|
|
|||
Decrease (increase) in notes receivable due from subsidiaries
|
(20,000
|
)
|
|
(58
|
)
|
|
92,530
|
|
|||
Capital contributions to subsidiaries
|
(103,133
|
)
|
|
(270,623
|
)
|
|
—
|
|
|||
Acquisitions, net of cash acquired
|
(972,619
|
)
|
|
(1,153,683
|
)
|
|
—
|
|
|||
Cost of equity method investments
|
(5,117
|
)
|
|
(10,633
|
)
|
|
(3,100
|
)
|
|||
Additions to property and equipment
|
(3,191
|
)
|
|
—
|
|
|
(584
|
)
|
|||
Other
|
(5,261
|
)
|
|
6,972
|
|
|
(3,207
|
)
|
|||
Net Cash Provided (Used) By Investing Activities
|
46,969
|
|
|
(721,262
|
)
|
|
(640,048
|
)
|
|||
FINANCING ACTIVITIES
|
|
|
|
|
|
||||||
Additions to senior long-term debt
|
—
|
|
|
592,923
|
|
|
493,149
|
|
|||
Increase in notes payable to subsidiaries
|
47,105
|
|
|
—
|
|
|
—
|
|
|||
Repayment and retirement of senior long-term debt
|
—
|
|
|
—
|
|
|
(183,343
|
)
|
|||
Premiums and fees related to early extinguishment of debt
|
—
|
|
|
—
|
|
|
(43,691
|
)
|
|||
Repurchases of common stock
|
(54,007
|
)
|
|
(110,838
|
)
|
|
(51,142
|
)
|
|||
Other
|
(70
|
)
|
|
(9,848
|
)
|
|
(337
|
)
|
|||
Net Cash Provided (Used) By Financing Activities
|
(6,972
|
)
|
|
472,237
|
|
|
214,636
|
|
|||
Decrease in cash, cash equivalents, restricted cash and restricted cash equivalents
|
(84,546
|
)
|
|
(19,888
|
)
|
|
(90,287
|
)
|
|||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of year
|
350,766
|
|
|
370,654
|
|
|
460,941
|
|
|||
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS AT END OF YEAR
|
$
|
266,220
|
|
|
$
|
350,766
|
|
|
$
|
370,654
|
|
|
Quarters Ended
|
||||||||||||||
(dollars in thousands, except per share amounts)
|
Mar. 31
|
|
June 30
|
|
Sept. 30
|
|
Dec. 31
|
||||||||
2018
|
|
|
|
|
|
|
|
||||||||
Operating revenues
|
$
|
1,575,471
|
|
|
$
|
1,987,013
|
|
|
$
|
2,235,949
|
|
|
$
|
1,042,852
|
|
Net income (loss)
(1)
|
(65,594
|
)
|
|
279,587
|
|
|
409,028
|
|
|
(753,374
|
)
|
||||
Net income (loss) to shareholders
(1)
|
(64,306
|
)
|
|
278,231
|
|
|
409,438
|
|
|
(751,543
|
)
|
||||
Comprehensive income (loss) to shareholders
|
(174,839
|
)
|
|
164,336
|
|
|
315,106
|
|
|
(680,373
|
)
|
||||
Net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(4.25
|
)
|
|
$
|
20.01
|
|
|
$
|
28.56
|
|
|
$
|
(53.88
|
)
|
Diluted
|
(4.25
|
)
|
|
19.97
|
|
|
28.50
|
|
|
(53.88
|
)
|
||||
2017
|
|
|
|
|
|
|
|
||||||||
Operating revenues
|
$
|
1,411,751
|
|
|
$
|
1,481,493
|
|
|
$
|
1,506,148
|
|
|
$
|
1,662,267
|
|
Net income (loss)
(1)
|
71,040
|
|
|
151,427
|
|
|
(261,035
|
)
|
|
439,326
|
|
||||
Net income (loss) to shareholders
(1)
|
69,869
|
|
|
149,660
|
|
|
(259,141
|
)
|
|
434,881
|
|
||||
Comprehensive income (loss) to shareholders
|
223,239
|
|
|
342,357
|
|
|
(19,869
|
)
|
|
629,247
|
|
||||
Net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
3.91
|
|
|
$
|
10.34
|
|
|
$
|
(18.82
|
)
|
|
$
|
30.48
|
|
Diluted
|
3.90
|
|
|
10.31
|
|
|
(18.82
|
)
|
|
30.39
|
|
||||
2016
|
|
|
|
|
|
|
|
||||||||
Operating revenues
|
$
|
1,376,182
|
|
|
$
|
1,375,937
|
|
|
$
|
1,431,282
|
|
|
$
|
1,428,625
|
|
Net income
(1)
|
163,646
|
|
|
80,673
|
|
|
83,421
|
|
|
132,703
|
|
||||
Net income to shareholders
(1)
|
160,370
|
|
|
78,797
|
|
|
83,796
|
|
|
132,726
|
|
||||
Comprehensive income (loss) to shareholders
|
396,994
|
|
|
209,942
|
|
|
89,161
|
|
|
(29,050
|
)
|
||||
Net income per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
11.21
|
|
|
$
|
5.44
|
|
|
$
|
5.62
|
|
|
$
|
9.14
|
|
Diluted
|
11.15
|
|
|
5.41
|
|
|
5.60
|
|
|
9.11
|
|
(1)
|
Effective January 1, 2018, the Company adopted ASU No. 2016-01. As a result, the change in fair value of equity securities is no longer recognized in other comprehensive income; rather, all changes in the fair value of equity securities are now recognized in net income. Prior periods have not been restated to conform to the current presentation. See note 1.
|
•
|
Underwriting - our underwriting operations are comprised of our risk-bearing insurance and reinsurance operations
|
•
|
Investing - our investing activities are primarily related to our underwriting operations
|
•
|
Markel Ventures - our Markel Ventures operations include our controlling interests in a diverse portfolio of businesses that operate outside of the specialty insurance marketplace
|
•
|
Investment management - our investment management operations include investment fund managers that offer a variety of investment products, including insurance-linked securities, catastrophe bonds, insurance swaps and weather derivatives
|
•
|
Program services - our program services business serves as a fronting platform that provides other insurance companies access to the U.S. property and casualty insurance market
|
(dollars in millions)
|
Net Loss
Reserves Held
|
|
Low End of
Actuarial
Range
(1)
|
|
High End of
Actuarial
Range
(1)
|
||||||
Insurance
|
$
|
5,957.0
|
|
|
$
|
5,081.6
|
|
|
$
|
6,487.4
|
|
Reinsurance
|
2,994.0
|
|
|
2,139.4
|
|
|
3,411.5
|
|
|||
Other
|
222.6
|
|
|
177.4
|
|
|
254.4
|
|
(1)
|
Due to the actuarial methods used to determine the separate ranges for each component of our business, it is not appropriate to aggregate the high or low ends of the separate ranges to determine the high and low ends of the actuarial range on a consolidated basis.
|
•
|
ASU No. 2016-13,
Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments
|
•
|
ASU No. 2018-12,
Financial Services-Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts
|
•
|
ASU No. 2018-15,
Intangibles-Goodwill and Other- Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Insurance segment underwriting profit
|
$
|
228,773
|
|
|
$
|
85,097
|
|
|
$
|
199,045
|
|
Reinsurance segment underwriting profit (loss)
|
(118,287
|
)
|
|
(300,018
|
)
|
|
109,205
|
|
|||
Net investment income
|
433,702
|
|
|
405,377
|
|
|
373,121
|
|
|||
Net investment gains (losses)
(1)
|
(437,596
|
)
|
|
(5,303
|
)
|
|
65,147
|
|
|||
Markel Ventures segment profit
(2)
|
77,479
|
|
|
115,250
|
|
|
113,298
|
|
|||
Other
(3)
|
(144,312
|
)
|
|
(83,797
|
)
|
|
(54,647
|
)
|
|||
Interest expense
|
(154,212
|
)
|
|
(132,451
|
)
|
|
(129,896
|
)
|
|||
Net foreign exchange gains (losses)
|
106,598
|
|
|
3,140
|
|
|
(1,253
|
)
|
|||
Loss on early extinguishment of debt
|
—
|
|
|
—
|
|
|
(44,100
|
)
|
|||
Income tax benefit (expense)
|
(122,498
|
)
|
|
313,463
|
|
|
(169,477
|
)
|
|||
Net loss (income) attributable to noncontrolling interests
|
2,173
|
|
|
(5,489
|
)
|
|
(4,754
|
)
|
|||
Net income (loss) to shareholders
|
$
|
(128,180
|
)
|
|
$
|
395,269
|
|
|
$
|
455,689
|
|
(1)
|
Effective January 1, 2018, we adopted ASU No. 2016-01,
Financial Instruments (Topic 825): Recognition and Measurement of Financial Assets and Financial Liabilities
, and equity securities are no longer classified as available-for-sale with unrealized gains and losses recognized in other comprehensive income, rather, changes in the fair value of equity securities are now recognized in net income. Prior periods have not been restated to conform to the current presentation. See note 1 of the notes to consolidated financial statements.
|
(2)
|
Segment profit for the Markel Ventures segment includes amortization of intangible assets attributable to Markel Ventures. Amortization of intangible assets is not allocated to any other reportable segments.
|
(3)
|
Other represents the total profit (loss) attributable to the Company's operations that are not included in a reportable segment as well as any amortization of intangible assets and impairment of goodwill and intangible assets that is not allocated to a reportable segment.
|
|
Years Ended December 31,
|
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
|
||||||
Gross premium volume
(1)
|
$
|
5,798,996
|
|
|
$
|
5,253,107
|
|
|
$
|
4,796,645
|
|
|
Net written premiums
|
$
|
4,785,590
|
|
|
$
|
4,417,787
|
|
|
$
|
4,001,020
|
|
|
Net retention
(1)
|
83
|
%
|
|
84
|
%
|
|
83
|
%
|
|
|||
Earned premiums
|
$
|
4,712,060
|
|
|
$
|
4,247,978
|
|
|
$
|
3,865,870
|
|
|
Losses and loss adjustment expenses
|
$
|
2,820,715
|
|
|
$
|
2,865,761
|
|
|
$
|
2,050,744
|
|
|
Underwriting, acquisition and insurance expenses
|
$
|
1,777,511
|
|
|
$
|
1,589,464
|
|
|
$
|
1,497,125
|
|
|
Underwriting profit (loss)
|
$
|
113,834
|
|
|
$
|
(207,247
|
)
|
|
$
|
318,001
|
|
|
|
|
|
|
|
|
|
||||||
U.S. GAAP Combined Ratios
|
|
|
|
|
|
|
||||||
Insurance
|
94
|
%
|
|
97
|
%
|
|
93
|
%
|
|
|||
Reinsurance
|
113
|
%
|
|
132
|
%
|
|
87
|
%
|
|
|||
Markel Corporation (Consolidated)
|
98
|
%
|
|
105
|
%
|
|
92
|
%
|
|
(1)
|
Gross premium volume and net retention for the years ended December 31, 2018 and December 31, 2017 exclude
$2.1 billion
and
$253.9 million
, respectively of gross written premiums attributable to our program services business, substantially all of which was ceded.
|
|
Years Ended December 31,
|
||||||||||||||||||||||
|
2018
|
|
2017
|
||||||||||||||||||||
|
2018 Catastrophes
|
|
2017 Catastrophes
|
||||||||||||||||||||
(dollars in thousands)
|
Insurance
|
|
Reinsurance
|
|
Consolidated
|
|
Insurance
|
|
Reinsurance
|
|
Consolidated
|
||||||||||||
Losses and loss adjustment expenses
|
$
|
105,265
|
|
|
$
|
187,490
|
|
|
$
|
292,755
|
|
|
$
|
254,976
|
|
|
$
|
330,384
|
|
|
$
|
585,360
|
|
Ceded (assumed) reinstatement premiums
|
5,142
|
|
|
(10,583
|
)
|
|
(5,441
|
)
|
|
12,391
|
|
|
(32,465
|
)
|
|
(20,074
|
)
|
||||||
Underwriting loss
|
$
|
110,407
|
|
|
$
|
176,907
|
|
|
$
|
287,314
|
|
|
$
|
267,367
|
|
|
$
|
297,919
|
|
|
$
|
565,286
|
|
Impact on combined ratio
|
3
|
%
|
|
19
|
%
|
|
6
|
%
|
|
8
|
%
|
|
32
|
%
|
|
13
|
%
|
|
Year Ended December 31, 2018
|
||||||||||||||
(dollars in millions)
|
Insurance Segment
|
|
Reinsurance Segment
|
|
Other
|
|
Total
|
||||||||
Insurance segment:
|
|
|
|
|
|
|
|
||||||||
General liability
|
$
|
(143.0
|
)
|
|
|
|
|
|
$
|
(143.0
|
)
|
||||
Workers' compensation
|
(100.1
|
)
|
|
|
|
|
|
(100.1
|
)
|
||||||
Professional liability
|
(68.5
|
)
|
|
|
|
|
|
(68.5
|
)
|
||||||
Marine and energy
|
(70.7
|
)
|
|
|
|
|
|
(70.7
|
)
|
||||||
Reinsurance segment:
|
|
|
|
|
|
|
|
||||||||
Surety
|
|
|
$
|
(23.9
|
)
|
|
|
|
(23.9
|
)
|
|||||
Marine and energy
|
|
|
(18.0
|
)
|
|
|
|
(18.0
|
)
|
||||||
Professional liability
|
|
|
16.2
|
|
|
|
|
16.2
|
|
||||||
Net other prior years' redundancy
|
(120.0
|
)
|
|
(17.3
|
)
|
|
$
|
(5.7
|
)
|
|
(143.0
|
)
|
|||
Decrease
|
$
|
(502.3
|
)
|
|
$
|
(43.0
|
)
|
|
$
|
(5.7
|
)
|
|
$
|
(551.0
|
)
|
|
Year Ended December 31, 2017
|
||||||||||||||
(dollars in millions)
|
Insurance Segment
|
|
Reinsurance Segment
|
|
Other
|
|
Total
|
||||||||
Insurance segment:
|
|
|
|
|
|
|
|
||||||||
General liability
|
$
|
(144.1
|
)
|
|
|
|
|
|
$
|
(144.1
|
)
|
||||
Workers' compensation
|
(65.6
|
)
|
|
|
|
|
|
(65.6
|
)
|
||||||
Professional liability
|
(100.4
|
)
|
|
|
|
|
|
(100.4
|
)
|
||||||
Marine and energy
|
(42.5
|
)
|
|
|
|
|
|
(42.5
|
)
|
||||||
Personal Lines
|
(29.1
|
)
|
|
|
|
|
|
(29.1
|
)
|
||||||
Reinsurance segment:
|
|
|
|
|
|
|
|
|
|||||||
Ogden rate decrease
|
|
|
$
|
85.0
|
|
|
|
|
85.0
|
|
|||||
Property
|
|
|
(41.2
|
)
|
|
|
|
(41.2
|
)
|
||||||
Net other prior years' redundancy
|
(118.9
|
)
|
|
(36.0
|
)
|
|
$
|
(8.7
|
)
|
|
(163.6
|
)
|
|||
Increase (decrease)
|
$
|
(500.6
|
)
|
|
$
|
7.8
|
|
|
$
|
(8.7
|
)
|
|
$
|
(501.5
|
)
|
|
Year Ended December 31, 2016
|
||||||||||||||
(dollars in millions)
|
Insurance Segment
|
|
Reinsurance Segment
|
|
Other
|
|
Total
|
||||||||
Insurance segment:
|
|
|
|
|
|
|
|
||||||||
General liability
|
$
|
(127.1
|
)
|
|
|
|
|
|
$
|
(127.1
|
)
|
||||
Workers' compensation
|
(41.1
|
)
|
|
|
|
|
|
(41.1
|
)
|
||||||
Property:
|
|
|
|
|
|
|
|
||||||||
Commercial property
|
(35.3
|
)
|
|
|
|
|
|
(35.3
|
)
|
||||||
Inland marine
|
(20.1
|
)
|
|
|
|
|
|
(20.1
|
)
|
||||||
Professional liability:
|
|
|
|
|
|
|
|
||||||||
Medical malpractice and specified medical
|
71.2
|
|
|
|
|
|
|
71.2
|
|
||||||
All other
|
(104.6
|
)
|
|
|
|
|
|
(104.6
|
)
|
||||||
Marine and energy
|
(50.2
|
)
|
|
|
|
|
|
(50.2
|
)
|
||||||
Reinsurance segment:
|
|
|
|
|
|
|
|
||||||||
Property
|
|
|
$
|
(67.6
|
)
|
|
|
|
(67.6
|
)
|
|||||
Net other prior years' redundancy
|
(62.4
|
)
|
|
(57.9
|
)
|
|
$
|
(10.1
|
)
|
|
(130.4
|
)
|
|||
Decrease
|
$
|
(369.6
|
)
|
|
$
|
(125.5
|
)
|
|
$
|
(10.1
|
)
|
|
$
|
(505.2
|
)
|
Gross Premium Volume
|
|
|
|
|
|
||||||
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Insurance segment
|
$
|
4,749,166
|
|
|
$
|
4,141,201
|
|
|
$
|
3,755,081
|
|
Reinsurance segment
|
1,050,870
|
|
|
1,112,101
|
|
|
1,041,055
|
|
|||
Other
|
(1,040
|
)
|
|
(195
|
)
|
|
509
|
|
|||
Total Underwriting
|
5,798,996
|
|
|
5,253,107
|
|
|
4,796,645
|
|
|||
Other - Program services
|
2,065,473
|
|
|
253,853
|
|
|
—
|
|
|||
Total
|
$
|
7,864,469
|
|
|
$
|
5,506,960
|
|
|
$
|
4,796,645
|
|
Net Written Premiums
|
|
|
|
|
|
||||||
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Insurance segment
|
$
|
3,904,773
|
|
|
$
|
3,439,796
|
|
|
$
|
3,101,657
|
|
Reinsurance segment
|
882,285
|
|
|
978,160
|
|
|
898,728
|
|
|||
Other
|
(1,468
|
)
|
|
(169
|
)
|
|
635
|
|
|||
Total Underwriting
|
4,785,590
|
|
|
4,417,787
|
|
|
4,001,020
|
|
|||
Other - Program services
|
1,988
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
4,787,578
|
|
|
$
|
4,417,787
|
|
|
$
|
4,001,020
|
|
Earned Premiums
|
|
|
|
|
|
||||||
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Insurance segment
|
$
|
3,783,939
|
|
|
$
|
3,314,033
|
|
|
$
|
3,028,844
|
|
Reinsurance segment
|
928,574
|
|
|
934,114
|
|
|
836,264
|
|
|||
Other
|
(1,468
|
)
|
|
(169
|
)
|
|
762
|
|
|||
Total Underwriting
|
4,711,045
|
|
|
4,247,978
|
|
|
3,865,870
|
|
|||
Other - Program services
|
1,015
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
4,712,060
|
|
|
$
|
4,247,978
|
|
|
$
|
3,865,870
|
|
|
Years Ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Net investment income
|
$
|
434,215
|
|
|
$
|
405,709
|
|
|
$
|
373,230
|
|
Net investment gains (losses)
(1)
|
$
|
(437,596
|
)
|
|
$
|
(5,303
|
)
|
|
$
|
65,147
|
|
Change in net unrealized investment gains on available-for-sale securities
(1)
|
$
|
(299,446
|
)
|
|
$
|
1,125,440
|
|
|
$
|
342,111
|
|
Investment yield
(2)
|
2.7
|
%
|
|
2.6
|
%
|
|
2.4
|
%
|
|||
Taxable equivalent total investment return, before foreign currency effect
|
(0.7
|
)%
|
|
9.2
|
%
|
|
5.0
|
%
|
|||
Taxable equivalent total investment return
|
(1.0
|
)%
|
|
10.2
|
%
|
|
4.4
|
%
|
|||
Invested assets, end of year
|
$
|
19,238,261
|
|
|
$
|
20,570,337
|
|
|
$
|
19,058,666
|
|
(1)
|
Effective January 1, 2018, we adopted ASU No. 2016-01 and equity securities are no longer classified as available-for-sale with unrealized gains and losses recognized in other comprehensive income, rather, changes in the fair value of equity securities are now recognized in net income. Prior periods have not been restated to conform to the current presentation. See note 1 of the notes to consolidated financial statements.
|
(2)
|
Investment yield reflects net investment income as a percentage of monthly average invested assets at amortized cost.
|
|
Years Ended December 31,
|
|||||||
|
2018
|
|
2017
|
|
2016
|
|||
Investment yield
(1)
|
2.7
|
%
|
|
2.6
|
%
|
|
2.4
|
%
|
Adjustment of investment yield from amortized cost to fair value
|
(0.6
|
)%
|
|
(0.5
|
)%
|
|
(0.4
|
)%
|
Net amortization of net premium on fixed maturities
|
0.4
|
%
|
|
0.4
|
%
|
|
0.4
|
%
|
Net investment gains (losses) and change in net unrealized investment gains on available-for-sale securities
|
(3.4
|
)%
|
|
5.9
|
%
|
|
2.3
|
%
|
Taxable equivalent effect for interest and dividends
(2)
|
0.1
|
%
|
|
0.4
|
%
|
|
0.4
|
%
|
Other
(3)
|
(0.2
|
)%
|
|
1.4
|
%
|
|
(0.7
|
)%
|
Taxable equivalent total investment return
|
(1.0
|
)%
|
|
10.2
|
%
|
|
4.4
|
%
|
(1)
|
Investment yield reflects net investment income as a percentage of monthly average invested assets at amortized cost.
|
(2)
|
Adjustment to tax-exempt interest and dividend income to reflect a taxable equivalent basis.
|
(3)
|
Adjustment to reflect the impact of changes in foreign currency exchange rates and time-weighting the inputs to the calculation of taxable equivalent total investment return.
|
|
December 31,
|
||||||
(dollars in thousands)
|
2018
|
|
2017
|
||||
ASSETS
|
|
|
|
||||
Cash and cash equivalents
|
$
|
164,336
|
|
|
$
|
165,172
|
|
Receivables
|
188,048
|
|
|
190,208
|
|
||
Goodwill
|
497,338
|
|
|
424,982
|
|
||
Intangible assets
|
431,457
|
|
|
400,589
|
|
||
Other assets:
|
|
|
|
||||
Inventory
|
298,729
|
|
|
227,773
|
|
||
Property, plant and equipment, net
|
407,834
|
|
|
369,433
|
|
||
Other
|
136,764
|
|
|
122,571
|
|
||
Total Other assets
|
843,327
|
|
|
719,777
|
|
||
Total Assets
|
$
|
2,124,506
|
|
|
$
|
1,900,728
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
149,907
|
|
|
$
|
101,526
|
|
Senior long-term debt and other debt
(1)
|
684,099
|
|
|
554,282
|
|
||
Other liabilities
|
258,843
|
|
|
244,082
|
|
||
Total Liabilities
|
1,092,849
|
|
|
899,890
|
|
||
Redeemable noncontrolling interests
|
174,062
|
|
|
166,270
|
|
||
Shareholders' equity
(2)
|
860,931
|
|
|
837,060
|
|
||
Noncontrolling interests
|
(3,336
|
)
|
|
(2,492
|
)
|
||
Total Equity
|
857,595
|
|
|
834,568
|
|
||
Total Liabilities and Equity
|
$
|
2,124,506
|
|
|
$
|
1,900,728
|
|
(1)
|
Senior long-term debt and other debt as of
December 31, 2018
and
2017
included $606.0 million and $476.0 million, respectively, of debt due to other subsidiaries of Markel Corporation, which was eliminated in consolidation.
|
(2)
|
Shareholders' equity as of
December 31, 2018
and
2017
included $658.6 million and $663.6 million, respectively, of common stock, which represents Markel Corporation's investment in Markel Ventures, which was eliminated in consolidation.
|
|
Years ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
OPERATING REVENUES
|
|
|
|
|
|
||||||
Net investment income
|
$
|
513
|
|
|
$
|
332
|
|
|
$
|
109
|
|
Products revenues
|
1,497,523
|
|
|
951,012
|
|
|
885,473
|
|
|||
Services and other revenues
(1)
|
417,461
|
|
|
385,808
|
|
|
328,976
|
|
|||
Total Operating Revenues
|
1,915,497
|
|
|
1,337,152
|
|
|
1,214,558
|
|
|||
OPERATING EXPENSES
|
|
|
|
|
|
||||||
Products expenses
|
1,413,248
|
|
|
850,449
|
|
|
755,591
|
|
|||
Services and other expenses
|
366,739
|
|
|
336,484
|
|
|
297,841
|
|
|||
Amortization of intangible assets
|
40,208
|
|
|
31,429
|
|
|
29,105
|
|
|||
Impairment of goodwill and intangible assets
|
14,904
|
|
|
—
|
|
|
18,723
|
|
|||
Total Operating Expenses
|
1,835,099
|
|
|
1,218,362
|
|
|
1,101,260
|
|
|||
Operating Income
|
80,398
|
|
|
118,790
|
|
|
113,298
|
|
|||
Net foreign exchange gains
|
(21
|
)
|
|
(1,090
|
)
|
|
(212
|
)
|
|||
Interest expense
(2)
|
28,423
|
|
|
20,009
|
|
|
15,718
|
|
|||
Income Before Income Taxes
|
51,996
|
|
|
99,871
|
|
|
97,792
|
|
|||
Income tax expense (benefit)
|
18,579
|
|
|
(9,303
|
)
|
|
36,005
|
|
|||
Net Income
|
33,417
|
|
|
109,174
|
|
|
61,787
|
|
|||
Net income (loss) attributable to noncontrolling interests
|
(1,841
|
)
|
|
5,615
|
|
|
5,615
|
|
|||
Net Income to Shareholders
|
$
|
35,258
|
|
|
$
|
103,559
|
|
|
$
|
56,172
|
|
(1)
|
Services and other revenues for the years ended
December 31, 2018
and
2017
included intercompany revenues of $2.9 million and $3.5 million, respectively, which were eliminated in consolidation. There were no intercompany revenues in
2016
.
|
(2)
|
Interest expense for the years ended
December 31, 2018
,
2017
and
2016
included intercompany interest expense of $18.1 million, $12.3 million and $9.7 million, respectively, which was eliminated in consolidation.
|
|
Years ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of year
|
$
|
165,172
|
|
|
$
|
105,316
|
|
|
$
|
120,889
|
|
Net cash provided by operating activities
|
163,572
|
|
|
195,054
|
|
|
100,105
|
|
|||
Net cash used by investing activities
|
(256,533
|
)
|
|
(456,586
|
)
|
|
(55,293
|
)
|
|||
Net cash provided (used) by financing activities
(1,2)
|
92,125
|
|
|
321,388
|
|
|
(60,385
|
)
|
|||
Increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents
|
(836
|
)
|
|
59,856
|
|
|
(15,573
|
)
|
|||
Cash, cash equivalents, restricted cash and restricted cash equivalents, end of year
|
$
|
164,336
|
|
|
$
|
165,172
|
|
|
$
|
105,316
|
|
(1)
|
Net cash provided (used) by financing activities for the years ended
December 31, 2017
included capital contributions from our holding company (Markel Corporation) of $145.0 million, which were eliminated in consolidation. There were no capital contributions from our holding company for the years ended
December 31, 2018
and
2016
.
|
(2)
|
Net cash provided (used) by financing activities for the year and ended
December 31, 2018
and
2017
included net additions to debt of $130.0 million and $265.0 million, respectively, which were eliminated in consolidation. Net cash provided (used) by financing activities for the year ended December 31,
2016
includes net repayments of debt of $5.9 million, which were eliminated in consolidation.
|
|
Years ended December 31,
|
||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Markel Ventures operating income
(1)
|
$
|
77,479
|
|
|
$
|
115,250
|
|
|
$
|
113,298
|
|
Depreciation expense
|
52,207
|
|
|
41,704
|
|
|
35,498
|
|
|||
Amortization of intangible assets
|
40,208
|
|
|
31,429
|
|
|
29,105
|
|
|||
Markel Ventures EBITDA
|
$
|
169,894
|
|
|
$
|
188,383
|
|
|
$
|
177,901
|
|
(1)
|
Operating income for the years ended
December 31, 2018
and
2017
excluded intercompany revenues of $2.9 million and $3.5 million, respectively. There were no intercompany revenues in
2016
.
|
|
Years Ended December 31,
|
||||||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||||||||||||||
(dollars in thousands)
|
Operating Revenues
|
|
Operating Expenses
|
|
Operating Revenues
|
|
Operating Expenses
|
|
Operating Revenues
|
|
Operating Expenses
|
||||||||||||
Service and other revenues and expenses
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investment management
|
$
|
91,527
|
|
|
$
|
21,417
|
|
|
$
|
28,740
|
|
|
$
|
52,636
|
|
|
$
|
56,455
|
|
|
$
|
46,190
|
|
Program services
|
95,688
|
|
|
24,298
|
|
|
15,328
|
|
|
6,508
|
|
|
—
|
|
|
—
|
|
||||||
Life and annuity
|
1,660
|
|
|
27,855
|
|
|
2,022
|
|
|
28,218
|
|
|
1,891
|
|
|
26,504
|
|
||||||
Other
|
31,666
|
|
|
34,615
|
|
|
33,905
|
|
|
34,775
|
|
|
34,984
|
|
|
45,606
|
|
||||||
|
220,541
|
|
|
108,185
|
|
|
79,995
|
|
|
122,137
|
|
|
93,330
|
|
|
118,300
|
|
||||||
Amortization of intangible assets
(1)
|
|
|
75,722
|
|
|
|
|
49,329
|
|
|
|
|
39,428
|
|
|||||||||
Impairment of goodwill and intangible assets
(2)
|
|
|
184,294
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|||||||||
Total
|
$
|
220,541
|
|
|
$
|
368,201
|
|
|
$
|
79,995
|
|
|
$
|
171,466
|
|
|
$
|
93,330
|
|
|
$
|
157,728
|
|
(1)
|
Excludes amortization of intangible assets attributable to Markel Ventures, which is included in the Markel Ventures segment. Amortization of intangible assets is not allocated to any other reportable segments.
|
(2)
|
Excludes impairment of goodwill and intangible assets attributable to Markel Ventures, which is included in the Markel Ventures segment.
|
|
Payments Due by Period
(1)
|
||||||||||||||||||
(dollars in thousands)
|
Total
|
|
Less than 1
year
|
|
1-3 years
|
|
4-5 years
|
|
More than
5 years
|
||||||||||
Unpaid losses and loss adjustment expenses (estimated)
|
$
|
14,307,988
|
|
|
$
|
4,672,613
|
|
|
$
|
4,413,952
|
|
|
$
|
2,295,875
|
|
|
$
|
2,925,548
|
|
Life and annuity benefits (estimated)
|
1,329,254
|
|
|
82,439
|
|
|
138,025
|
|
|
128,351
|
|
|
980,439
|
|
|||||
Senior long-term debt and other debt
|
4,806,717
|
|
|
436,557
|
|
|
870,367
|
|
|
768,446
|
|
|
2,731,347
|
|
|||||
Operating leases
|
305,907
|
|
|
48,853
|
|
|
79,232
|
|
|
60,159
|
|
|
117,663
|
|
|||||
Total
|
$
|
20,749,866
|
|
|
$
|
5,240,462
|
|
|
$
|
5,501,576
|
|
|
$
|
3,252,831
|
|
|
$
|
6,754,997
|
|
(1)
|
See notes
9
,
10
,
11
and
18
of the notes to consolidated financial statements for further discussion of these obligations.
|
(dollars in thousands)
|
Insurance
|
|
Reinsurance
|
|
Other
|
|
Program Services
|
|
Consolidated
|
||||||||||
December 31, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
Case reserves
|
$
|
2,719,038
|
|
|
$
|
1,336,884
|
|
|
$
|
166,844
|
|
|
$
|
881,847
|
|
|
$
|
5,104,613
|
|
IBNR reserves
|
5,204,653
|
|
|
2,144,456
|
|
|
219,485
|
|
|
1,634,781
|
|
|
9,203,375
|
|
|||||
Total
|
$
|
7,923,691
|
|
|
$
|
3,481,340
|
|
|
$
|
386,329
|
|
|
$
|
2,516,628
|
|
(1)
|
$
|
14,307,988
|
|
December 31, 2017
|
|
|
|
|
|
|
|
|
|
||||||||||
Case reserves
|
$
|
2,705,663
|
|
|
$
|
1,219,119
|
|
|
$
|
188,892
|
|
|
$
|
759,943
|
|
|
$
|
4,873,617
|
|
IBNR reserves
|
4,976,016
|
|
|
2,104,783
|
|
|
240,377
|
|
|
1,435,488
|
|
|
8,756,664
|
|
|||||
Total
|
$
|
7,681,679
|
|
|
$
|
3,323,902
|
|
|
$
|
429,269
|
|
|
$
|
2,195,431
|
|
(1)
|
$
|
13,630,281
|
|
(1)
|
Substantially all of the premium written in our program services business is ceded, resulting in reinsurance recoverables on paid and unpaid losses of
$2.5 billion
and
$2.2 billion
as of December 31, 2018 and 2017, respectively. We are the beneficiary of letters of credit, trust accounts and funds withheld in the aggregate amount of
$2.2 billion
and
$1.9 billion
at
December 31, 2018
and 2017, respectively, collateralizing these reinsurance recoverable balances in our program services business.
|
(dollars in millions)
|
Estimated
Fair Value
|
|
Hypothetical
Price Change
|
|
Estimated
Fair Value after
Hypothetical
Change in Prices
|
|
Estimated
Hypothetical
Percentage Increase
(Decrease) in
Shareholders' Equity
|
|||||
As of December 31, 2018
|
|
|
|
|
|
|
|
|||||
Equity securities
|
$
|
5,721
|
|
|
35% increase
|
|
$
|
7,723
|
|
|
17.4
|
%
|
|
|
|
35% decrease
|
|
3,719
|
|
|
(17.4
|
)
|
|||
As of December 31, 2017
|
|
|
|
|
|
|
|
|||||
Equity securities
|
$
|
5,968
|
|
|
35% increase
|
|
$
|
8,057
|
|
|
17.1
|
%
|
|
|
|
35% decrease
|
|
3,879
|
|
|
(17.1
|
)
|
(dollars in millions)
|
Estimated
Fair Value
|
|
Hypothetical
Change in
Interest Rates
(bp=basis points)
|
|
Estimated
Fair Value after
Hypothetical Change
in Interest Rates
|
|
Hypothetical Percentage
Increase (Decrease) in
|
||||||||
Fair Value of
Fixed Maturities
|
|
Shareholders'
Equity
|
|||||||||||||
Fixed Maturity Investments
|
|
|
|
|
|
|
|
|
|
||||||
As of December 31, 2018
|
|
|
|
|
|
|
|
|
|
||||||
Total fixed maturity investments
|
$
|
10,043
|
|
|
200 bp decrease
|
|
$
|
11,364
|
|
|
13.2
|
%
|
|
11.5
|
%
|
|
|
|
100 bp decrease
|
|
10,681
|
|
|
6.4
|
|
|
5.6
|
|
|||
|
|
|
100 bp increase
|
|
9,436
|
|
|
(6.0
|
)
|
|
(5.3
|
)
|
|||
|
|
|
200 bp increase
|
|
8,848
|
|
|
(11.9
|
)
|
|
(10.4
|
)
|
|||
As of December 31, 2017
|
|
|
|
|
|
|
|
|
|
||||||
Total fixed maturity investments
|
$
|
9,941
|
|
|
200 bp decrease
|
|
$
|
11,323
|
|
|
13.9
|
%
|
|
11.3
|
%
|
|
|
|
100 bp decrease
|
|
10,606
|
|
|
6.7
|
|
|
5.5
|
|
|||
|
|
|
100 bp increase
|
|
9,319
|
|
|
(6.3
|
)
|
|
(5.1
|
)
|
|||
|
|
|
200 bp increase
|
|
8,720
|
|
|
(12.3
|
)
|
|
(10.0
|
)
|
|||
Liabilities
(1)
|
|
|
|
|
|
|
|
|
|
||||||
As of December 31, 2018
|
|
|
|
|
|
|
|
|
|
||||||
Borrowings
|
$
|
3,030
|
|
|
200 bp decrease
|
|
$
|
3,555
|
|
|
|
|
|
||
|
|
|
100 bp decrease
|
|
3,270
|
|
|
|
|
|
|||||
|
|
|
100 bp increase
|
|
2,826
|
|
|
|
|
|
|||||
|
|
|
200 bp increase
|
|
2,652
|
|
|
|
|
|
|||||
As of December 31, 2017
|
|
|
|
|
|
|
|
|
|
||||||
Borrowings
|
$
|
3,351
|
|
|
200 bp decrease
|
|
$
|
4,015
|
|
|
|
|
|
||
|
|
|
100 bp decrease
|
|
3,653
|
|
|
|
|
|
|||||
|
|
|
100 bp increase
|
|
3,096
|
|
|
|
|
|
|||||
|
|
|
200 bp increase
|
|
2,880
|
|
|
|
|
|
(1)
|
Changes in estimated fair value have no impact on shareholders' equity.
|
•
|
our expectations about future results of our underwriting, investing, Markel Ventures and other operations are based on current knowledge and assume no significant man-made or natural catastrophes, no significant changes in products or personnel and no adverse changes in market conditions;
|
•
|
the effect of cyclical trends on our underwriting, investing, Markel Ventures and other operations, including demand and pricing in the insurance, reinsurance and other markets in which we operate;
|
•
|
actions by competitors, including the application of new or "disruptive" technologies or business models and consolidation, and the effect of competition on market trends and pricing;
|
•
|
the frequency and severity of man-made and natural catastrophes (including earthquakes, fires and weather-related catastrophes) may exceed expectations, are unpredictable and, in the case of fires and weather-related catastrophes, may be exacerbated if, as many forecast, conditions in the oceans and atmosphere result in increased hurricane, flood, drought or other adverse weather-related activity;
|
•
|
we offer insurance and reinsurance coverage against terrorist acts in connection with some of our programs, and in other instances we are legally required to offer terrorism insurance; in both circumstances, we actively manage our exposure, but if there is a covered terrorist attack, we could sustain material losses;
|
•
|
emerging claim and coverage issues, changing legal and social trends, and inherent uncertainties in the loss estimation process can adversely impact the adequacy of our loss reserves and our allowance for reinsurance recoverables;
|
•
|
reinsurance reserves are subject to greater uncertainty than insurance reserves, primarily because of reliance upon the original underwriting decisions made by ceding companies and the longer lapse of time from the occurrence of loss events to their reporting to the reinsurer for ultimate resolution;
|
•
|
changes in the assumptions and estimates used in establishing reserves for our life and annuity reinsurance book (which is in runoff), for example, changes in assumptions and estimates of mortality, longevity, morbidity and interest rates, could result in material increases in our estimated loss reserves for such business;
|
•
|
adverse developments in insurance coverage litigation or other legal or administrative proceedings could result in material increases in our estimates of loss reserves;
|
•
|
changes in the availability, costs and quality of reinsurance coverage, which may impact our ability to write or continue to write certain lines of business;
|
•
|
the ability or willingness of reinsurers to pay balances due may be adversely affected by industry and economic conditions, deterioration in reinsurer credit quality and coverage disputes, and collateral we hold may not be sufficient to cover a reinsurer's obligation to us;
|
•
|
after the commutation of ceded reinsurance contracts, any subsequent adverse development in the re-assumed loss reserves will result in a charge to earnings;
|
•
|
regulatory actions can impede our ability to charge adequate rates and efficiently allocate capital;
|
•
|
general economic and market conditions and industry specific conditions, including extended economic recessions or expansions; prolonged periods of slow economic growth; inflation or deflation; fluctuations in foreign currency exchange rates, commodity and energy prices and interest rates; volatility in the credit and capital markets; and other factors;
|
•
|
economic conditions, actual or potential defaults in municipal bonds or sovereign debt obligations, volatility in interest and foreign currency exchange rates and changes in market value of concentrated investments can have a significant impact on the fair value of our fixed maturity and equity securities, as well as the carrying value of our other assets and liabilities, and this impact may be heightened by market volatility;
|
•
|
economic conditions may adversely affect our access to capital and credit markets;
|
•
|
the effects of government intervention, including material changes in the monetary policies of central banks, to address financial downturns and economic and currency concerns;
|
•
|
the impacts that political and civil unrest and regional conflicts may have on our businesses and the markets they serve or that any disruptions in regional or worldwide economic conditions generally arising from these situations may have on our businesses, industries or investments;
|
•
|
the impacts that health epidemics and pandemics may have on our business operations and claims activity;
|
•
|
the impact on our businesses of the repeal, in part or in whole, or modification of U.S. health care reform legislation and regulations;
|
•
|
changes in U.S. tax laws, regulations or interpretations, including those relating to the Tax Cuts and Jobs Act, or in the tax laws, regulations or interpretations of other jurisdictions in which we operate and adjustments we may make in our operations or tax strategies in response to those changes;
|
•
|
a failure of our enterprise information technology systems and those maintained by third parties upon which we may rely, or a failure to comply with data protection or privacy regulations;
|
•
|
our acquisitions may increase our operational and control risks for a period of time;
|
•
|
we may not realize the contemplated benefits, including cost savings and synergies, of our acquisitions;
|
•
|
any determination requiring the write-off of a significant portion of our goodwill and intangible assets;
|
•
|
the failure or inadequacy of any loss limitation methods we employ;
|
•
|
the loss of services of any executive officer or other key personnel could adversely impact one or more of our operations;
|
•
|
our substantial international operations and investments expose us to increased political, operational and economic risks, including foreign currency exchange rate and credit risk;
|
•
|
the political, legal, regulatory, financial, tax and general economic impacts, and other impacts we cannot anticipate, related to the vote by the United Kingdom to leave the European Union (Brexit), which could have adverse consequences for our businesses, particularly our London-based international insurance operations;
|
•
|
our ability to obtain additional capital for our operations on terms favorable to us;
|
•
|
our compliance, or failure to comply, with covenants and other requirements under our revolving credit facility, senior debt and other indebtedness;
|
•
|
our ability to maintain or raise third party capital for existing or new investment vehicles and risks related to our management of third party capital;
|
•
|
the effectiveness of our procedures for compliance with existing and ever increasing guidelines, policies and legal and regulatory standards, rules, laws and regulations;
|
•
|
the impact of economic and trade sanctions and embargo programs on our businesses, including instances in which the requirements and limitations applicable to the global operations of U.S. companies and their affiliates are more restrictive than those applicable to non-U.S. companies and their affiliates;
|
•
|
regulatory changes, or challenges by regulators, regarding the use of certain issuing carrier or fronting arrangements;
|
•
|
our dependence on a limited number of brokers for a large portion of our revenues and third-party capital;
|
•
|
adverse changes in our assigned financial strength or debt ratings could adversely impact us, including our ability to attract and retain business, the amount of capital our insurance subsidiaries must hold and the availability and cost of capital;
|
•
|
changes in the amount of statutory capital our insurance subsidiaries are required to hold, which can vary significantly and is based on many factors outside our control;
|
•
|
losses from litigation and regulatory investigations and actions; and
|
•
|
a number of additional factors may adversely affect our Markel Ventures operations, and the markets they serve, and negatively impact their revenues and profitability, including, among others: adverse weather conditions, plant disease and other contaminants; changes in government support for education, healthcare and infrastructure projects; changes in capital spending levels; changes in the housing market; liability for environmental matters; volatility in the market prices for their products; and volatility in commodity prices and interest and foreign currency exchange rates.
|
•
|
the Markel CATCo Inquiries may have an adverse impact on the operations of MCIM and may result in adverse findings, reputational damage, the imposition of sanctions, increased costs, litigation and other negative consequences;
|
•
|
management time and resources may be diverted to address the Markel CATCo Inquiries, as well as related litigation;
|
•
|
the ongoing internal review related to the Markel CATCo Inquiries may result in adverse findings;
|
•
|
the MCIM Executive Departures, the lawsuits brought by two former MCIM executives and the ongoing leadership transition at MCIM, may materially and adversely impact MCIM’s business, operations and results of operations; and
|
•
|
the Markel CATCo Inquiries and the MCIM Executive Departures, as well as special redemption rights that are now being offered to investors in the Markel CATCo Funds, will adversely impact MCIM’s ability to maintain or raise capital.
|
|
Years Ended December 31,
|
||||||||||||||||||||||
|
2013
(1)
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
||||||||||||
Markel Corporation
|
$
|
100
|
|
|
$
|
118
|
|
|
$
|
152
|
|
|
$
|
156
|
|
|
$
|
196
|
|
|
$
|
179
|
|
S&P 500
|
100
|
|
|
114
|
|
|
115
|
|
|
129
|
|
|
157
|
|
|
150
|
|
||||||
Dow Jones Property & Casualty Insurance
|
100
|
|
|
112
|
|
|
122
|
|
|
143
|
|
|
168
|
|
|
162
|
|
(1)
|
$100 invested on
December 31, 2013
in our common stock or the listed index. Includes reinvestment of dividends.
|
|
(a)
|
|
(b)
|
|
(c)
|
|
(d)
|
||||||
Period
|
Total
Number of
Shares
Purchased
|
|
Average
Price
Paid per
Share
|
|
Total
Number of
Shares
Purchased as
Part
of Publicly
Announced
Plans
or Programs
(1)
|
|
Approximate
Dollar
Value of
Shares that
May Yet Be
Purchased
Under
the Plans or
Programs
(in thousands)
|
||||||
October 1, 2018 through October 31, 2018
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
289,832
|
|
November 1, 2018 through November 30, 2018
|
2,805
|
|
|
$
|
1,106.26
|
|
|
2,805
|
|
|
$
|
286,729
|
|
December 1, 2018 through December 31, 2018
|
7,785
|
|
|
$
|
1,042.93
|
|
|
7,785
|
|
|
$
|
278,610
|
|
Total
|
10,590
|
|
|
$
|
1,059.70
|
|
|
10,590
|
|
|
$
|
278,610
|
|
(1)
|
The Board of Directors approved the repurchase of up to $300 million of our common stock pursuant to a share repurchase program publicly announced on May 14, 2018 (the 2018 Program). The 2018 Program terminated and replaced a similar program authorized in November 2013 (the 2013 Program). Under the 2018 Program, as under the 2013 Program, we may repurchase outstanding shares of our common stock from time to time in privately negotiated or open market transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934. The 2018 Program has no expiration date but may be terminated by the Board of Directors at any time.
|
Exhibit No.
|
|
Document Description
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
Exhibit No.
|
|
Document Description
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
101
|
|
The following consolidated financial statements from Markel Corporation's Annual Report on Form 10-K for the year ended December 31, 2018, filed on February 28, 2019, formatted in XBRL: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income and Comprehensive Income, (iii) Consolidated Statements of Changes in Equity, (iv) Consolidated Statements of Cash Flows and (v) Notes to Consolidated Financial Statements.**
|
MARKEL CORPORATION
|
|
|
|
|
|
|
|
|
|
/s/ Thomas S. Gayner
|
|
/s/ Richard R. Whitt, III
|
|
/s/ Jeremy A. Noble
|
Thomas S. Gayner
|
|
Richard R. Whitt, III
|
|
Jeremy A. Noble
|
Co-Chief Executive Officer
|
|
Co-Chief Executive Officer
|
|
Senior Vice President and Chief Financial Officer
|
(Co-Principal Executive Officer)
|
|
(Co-Principal Executive Officer)
|
|
(Principal Financial Officer)
|
February 28, 2019
|
|
February 28, 2019
|
|
February 28, 2019
|
Signatures
|
|
Title
|
Date
|
|
|
|
|
/s/ Alan I. Kirshner
|
|
Executive Chairman, Chairman of the Board
|
February 28, 2019
|
Alan I. Kirshner
|
|
|
|
|
|
|
|
/s/ Anthony F. Markel
|
|
Director, Vice Chairman
|
February 28, 2019
|
Anthony F. Markel
|
|
|
|
|
|
|
|
/s/ Steven A. Markel
|
|
Director, Vice Chairman
|
February 28, 2019
|
Steven A. Markel
|
|
|
|
|
|
|
|
/s/ Thomas S. Gayner
|
|
Director, Co-Chief Executive Officer
|
February 28, 2019
|
Thomas S. Gayner
|
|
(Co-Principal Executive Officer)
|
|
|
|
|
|
/s/ Richard R. Whitt, III
|
|
Director, Co-Chief Executive Officer
|
February 28, 2019
|
Richard R. Whitt, III
|
|
(Co-Principal Executive Officer)
|
|
|
|
|
|
/s/ Jeremy A. Noble
|
|
Senior Vice President and Chief Financial Officer
|
February 28, 2019
|
Jeremy A. Noble
|
|
(Principal Financial Officer)
|
|
|
|
|
|
/s/ Nora N. Crouch
|
|
Chief Accounting Officer
|
February 28, 2019
|
Nora N. Crouch
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
/s/ J. Alfred Broaddus, Jr.
|
|
Director
|
February 28, 2019
|
J. Alfred Broaddus, Jr.
|
|
|
|
|
|
|
|
/s/ K. Bruce Connell
|
|
Director
|
February 28, 2019
|
K. Bruce Connell
|
|
|
|
|
|
|
|
/s/ Stewart M. Kasen
|
|
Director
|
February 28, 2019
|
Stewart M. Kasen
|
|
|
|
|
|
|
|
/s/ Diane Leopold
|
|
Director
|
February 28, 2019
|
Diane Leopold
|
|
|
|
|
|
|
|
/s/ Lemuel E. Lewis
|
|
Director
|
February 28, 2019
|
Lemuel E. Lewis
|
|
|
|
|
|
|
|
/s/ Darrell D. Martin
|
|
Director
|
February 28, 2019
|
Darrell D. Martin
|
|
|
|
|
|
|
|
/s/ Michael O'Reilly
|
|
Director
|
February 28, 2019
|
Michael O'Reilly
|
|
|
|
|
|
|
|
/s/ Michael J. Schewel
|
|
Director
|
February 28, 2019
|
Michael J. Schewel
|
|
|
|
|
|
|
|
/s/ Debora J. Wilson
|
|
Director
|
February 28, 2019
|
Debora J. Wilson
|
|
|
|
|
MARKEL CORPORATION
|
||
|
|
|
|
|
By:
|
|
/s/ Jeremy A. Noble
|
|
Name:
|
|
Jeremy A. Noble
|
|
Title:
|
|
Senior Vice President and Chief Financial Officer
|
|
MARKEL BERMUDA LIMITED
|
||
|
|
|
|
|
By:
|
|
/s/ April L. Duff
|
|
Name:
|
|
April L. Duff
|
|
Title:
|
|
Treasurer
|
|
MARKEL GLOBAL REINSURANCE COMPANY
|
||
|
|
|
|
|
By:
|
|
/s/ April L. Duff
|
|
Name:
|
|
April L. Duff
|
|
Title:
|
|
Treasurer
|
|
ALTERRA USA HOLDINGS LIMITED
|
||
|
|
|
|
|
By:
|
|
/s/ Jeremy A. Noble
|
|
Name:
|
|
Jeremy A. Noble
|
|
Title:
|
|
Vice President, Chief Financial Officer and Treasurer
|
|
ALTERRA FINANCE LLC
|
||
|
|
|
|
|
By:
|
|
/s/ Jeremy A. Noble
|
|
Name:
|
|
Jeremy A. Noble
|
|
Title:
|
|
Chief Financial Officer and Treasurer
|
|
WELLS FARGO BANK, NATIONAL ASSOCIATION
, as Administrative Agent, Swingline Lender, a Fronting Bank and as a Lender
|
||
|
|
|
|
|
By:
|
|
/s/ Grainne M. Pergolini
|
|
Name:
|
|
Grainne M. Pergolini
|
|
Title:
|
|
Managing Director
|
|
CITIBANK, N.A.
, as a Lender
|
||
|
|
|
|
|
By:
|
|
/s/ John Modin
|
|
Name:
|
|
John Modin
|
|
Title:
|
|
Vice President & Managing Director
|
|
BARCLAYS BANK, PLC
, as a Lender
|
||
|
|
|
|
|
By:
|
|
/s/ Karla K. Maloof
|
|
Name:
|
|
Karla K. Maloof
|
|
Title:
|
|
Head of Insurance - Americas, Corporate Banking
|
|
|
|
Executed in New York
|
|
JPMORGAN CHASE BANL, N.A.
, as a Lender
|
||
|
|
|
|
|
By:
|
|
/s/ Hector J. Varona
|
|
Name:
|
|
Hector J. Varona
|
|
Title:
|
|
Executive Director
|
|
SUNTRUST BANK
, as a Lender
|
||
|
|
|
|
|
By:
|
|
/s/ Doug Kennedy
|
|
Name:
|
|
Doug Kennedy
|
|
Title:
|
|
Director
|
|
Branch Banking and Trust Company
, as a Lender
|
||
|
|
|
|
|
By:
|
|
/s/ Scott Hennessee
|
|
Name:
|
|
Scott Hennessee
|
|
Title:
|
|
Senior Vice President
|
|
THE NORTHERN TRUST COMPANY
, as a Lender
|
||
|
|
|
|
|
By:
|
|
/s/ Joshua Metcalf
|
|
Name:
|
|
Joshua Metcalf
|
|
Title:
|
|
VP
|
|
Bank of America, N.A.
, as a Lender
|
||
|
|
|
|
|
By:
|
|
/s/ Hema Kishnani
|
|
Name:
|
|
Hema Kishnani
|
|
Title:
|
|
Vice President
|
|
THE BANK OF NEW YORK MELLON
, as a Lender
|
||
|
|
|
|
|
By:
|
|
/s/ Tatiana Ross
|
|
Name:
|
|
Tatiana Ross
|
|
Title:
|
|
Vice President
|
1.
|
Section 4.01(a)(ii) of the Adoption Agreement to the Plan is hereby amended in its entirety as follows:
|
Type of Bonus
|
Dollar Amount
|
% Amount
|
Increment
|
||
Min
|
Max
|
Min
|
Max
|
||
(a) Annual Bonus Plan
|
|
|
0%
|
75%
|
5%
|
(b) Executive Bonus Plan
|
|
|
0%
|
75%
|
5%
|
(c)
|
|
|
|
|
|
2.
|
Effective for Participant distribution elections made for Compensation earned during periods beginning on or after January 1, 2019, the last paragraph of Section 6.01(b) of the Plan is hereby amended in its entirety as follows:
|
|
Monthly
|
|
Quarterly
|
X
|
Annually
|
3.
|
In all respects not amended, the Plan is hereby ratified and confirmed.
|
|
MARKEL CORPORATION
|
||
|
|
|
|
|
By:
|
|
/s/ Linda V. Schreiner
|
|
Name:
|
|
Linda V. Schreiner
|
|
Title:
|
|
Sr. Vice President, Strategic Management
|
Subsidiary
|
|
State or Other Jurisdiction of
Incorporation or Organization
|
|
|
|
Alterra Capital Holdings Limited
|
|
Bermuda
|
Alterra Capital America Limited
|
|
England
|
Alterra USA Holdings, LLC
|
|
Delaware
|
Alterra Insurance USA Inc.
|
|
Delaware
|
Alterra Capital Brazil Limited
|
|
England
|
Markel Participações Ltda.
|
|
Brazil
|
Markel Resseguradora do Brasil S.A.
|
|
Brazil
|
Markel Seguradora do Brasil SA
|
|
Brazil
|
Alterra Capital Services Limited
|
|
Ireland
|
Alterra Holdings Limited
|
|
Bermuda
|
Alterra Agency Limited
|
|
Bermuda
|
New Point Re III Limited
|
|
Bermuda
|
Markel Bermuda Limited
|
|
Bermuda
|
Markel CATCo Investment Management Ltd.
|
|
Bermuda
|
Black/White & Associates Insurance Brokers
|
|
California
|
Essentia Insurance Company
|
|
Missouri
|
Evanston Insurance Company
|
|
Illinois
|
Mark IV Realty Corporation
|
|
Virginia
|
Schultz-Markel Associates, LLC
|
|
Delaware
|
Schultz Markel II, LLC
|
|
New Jersey
|
Markel American Insurance Company
|
|
Virginia
|
Markel Aspen, Inc.
|
|
Delaware
|
FirstComp Insurance Company
|
|
Nebraska
|
Markel Holdings GmbH
|
|
Germany
|
Markel Insurance S.E.
|
|
Germany
|
Markel Holdings Netherlands B.V.
|
|
The Netherlands
|
Markel Insurance Company
|
|
Illinois
|
Markel Global Reinsurance Company
|
|
Delaware
|
Markel International Holdings (Delaware) Limited
|
|
Delaware
|
Markel International Limited
|
|
England
|
Markel Capital Holdings Limited
|
|
England
|
Abbey Protection Limited
|
|
England
|
Abbey Protection Group Ltd.
|
|
England
|
Abbey Legal Holdings Limited
|
|
England
|
Abbey Legal Protection Limited
|
|
England
|
ACCTX Consulting Limited
|
|
England
|
ACCTX UK Limited
|
|
England
|
Accountax Law Limited
|
|
England
|
Alterra Capital UK Limited
|
|
England
|
Alterra at Lloyd's Limited
|
|
England
|
Markel Underwriting Services Limited
|
|
England
|
EC Insurance Company Limited
|
|
England
|
Galleon Marine Insurance Agency Limited
|
|
England
|
Markel Capital Limited
|
|
England
|
Markel International Insurance Company Limited
|
|
England
|
Markel Syndicate Management Limited
|
|
England
|
Markel Servicios S.A.
|
|
Argentina
|
Markel Service, Incorporated
|
|
Virginia
|
Thompson Insurance Enterprises, LLC
|
|
Delaware
|
Markel Surety Holding Corporation
|
|
Delaware
|
SureTec Insurance Company
|
|
Texas
|
SureTec Indemnity Company
|
|
California
|
Markel Ventures, Inc.
|
|
Virginia
|
Brahmin Leather Works, LLC
|
|
Delaware
|
CapTech Ventures, Inc.
|
|
Virginia
|
Cottrell Enterprises, Inc.
|
|
Georgia
|
Cottrell, Inc.
|
|
Georgia
|
Cottrell Properties, L.P.
|
|
Georgia
|
Diamond Healthcare Corporation
|
|
Virginia
|
Eagle Construction of Va., LLC
|
|
Virginia
|
archi-Tec-tonic, LLC
|
|
Virginia
|
Eagle Commercial Construction, LLC
|
|
Virginia
|
Eagle Commercial Realty, LLC
|
|
Virginia
|
Eagle Construction of Va. Properties, LLC
|
|
Virginia
|
Eagle Realty of Virginia, LLC
|
|
Virginia
|
Eagle West 7, LLC
|
|
Virginia
|
Innslake Title Agency, LLC
|
|
Virginia
|
KA Holdings, LLC
|
|
Virginia
|
Precision Realty, LLC
|
|
Virginia
|
West Broad Village IV, LLC
|
|
Virginia
|
EIC Credit, LLC
|
|
Virginia
|
Ellicott Dredge Enterprises, LLC
|
|
Maryland
|
Baltimore Dredge International, Inc.
|
|
Maryland
|
Ellicott Dredges, LLC
|
|
Maryland
|
Liquid Waste Technology, LLC
|
|
Maryland
|
Rohr International Dredge Co., LLC
|
|
Maryland
|
Rohr Dredge North America, LLC
|
|
Maryland
|
Rohr International Dredge Holdings, Inc.
|
|
Maryland
|
IDRECO B.V.
|
|
The Netherlands
|
Rohr Bagger GmbH
|
|
Germany
|
Rohr France, societie responsibilitie limitee
|
|
France
|
Havco WP LLC
|
|
Delaware
|
Markel Eagle Investment, LLC
|
|
Virginia
|
Markel Eagle Investment II, LLC
|
|
Virginia
|
Markel Food Group, Inc.
|
|
Virginia
|
AMF Automation Technologies, LLC
|
|
Virginia
|
Baking Technology Systems, LLC
|
|
Georgia
|
Reading Bakery Systems, Inc.
|
|
Pennsylvania
|
Solbern, Inc.
|
|
Virginia
|
Tromp Group Americas, LLC
|
|
Virginia
|
Tromp Group B.V.
|
|
The Netherlands
|
MVP Properties, LLC
|
|
Delaware
|
P1, Inc.
|
|
Delaware
|
P2, Inc.
|
|
Delaware
|
Costa Farms Holdings, LLC
|
|
Florida
|
Gardenvision, LLC
|
|
Florida
|
Costa Carolina Operations, LLC
|
|
North Carolina
|
PM Transport of Florida, LLC
|
|
Florida
|
Panel Specialists, Inc.
|
|
Texas
|
ParkLand Ventures, Inc.
|
|
Virginia
|
PMD Holdings, Inc.
|
|
Virginia
|
PartnerMD, LLC
|
|
Virginia
|
RD Holdings, LLC
|
|
Virginia
|
Retail Data, LLC
|
|
Virginia
|
Rosemont Investment Group, LLC
|
|
Delaware
|
Tennessee Dredge Company, LLC
|
|
Maryland
|
WI Holdings Inc.
|
|
Pennsylvania
|
Texas Trailer Corporation LLC
|
|
Texas
|
Weldship Industries, LLC
|
|
New Jersey
|
Weldship LLC
|
|
Pennsylvania
|
Markel West, Inc.
|
|
California
|
Markel-Gayner Asset Management Corporation
|
|
Virginia
|
MINT Canadian Specialty Underwriters Limited
|
|
Canada
|
Markel Canada Limited
|
|
Canada
|
Prairie State Administrative Services, Inc.
|
|
Illinois
|
State National Companies, Inc.
|
|
Delaware
|
SNC Financial GP, LLC
|
|
Nevada
|
SNC Financial LP, LLC
|
|
Nevada
|
T.B.A. Insurance Group, Ltd.
|
|
Texas
|
State National Intermediate Holdings, Inc.
|
|
Texas
|
State National Insurance Company, Inc.
|
|
Texas
|
Alterra America Insurance Company
|
|
Delaware
|
National Specialty Insurance Company
|
|
Texas
|
United Specialty Insurance Company
|
|
Delaware
|
City National Insurance Company
|
|
Texas
|
Independent Specialty Insurance Company
|
|
Delaware
|
1.
|
I have reviewed this annual report on Form 10-K of Markel Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
February 28, 2019
|
|
/s/ Richard R. Whitt, III
|
|
|
Richard R. Whitt, III
|
|
|
Co-Chief Executive Officer
|
|
|
(Co-Principal Executive Officer)
|
1.
|
I have reviewed this annual report on Form 10-K of Markel Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
February 28, 2019
|
|
/s/ Thomas S. Gayner
|
|
|
Thomas S. Gayner
|
|
|
Co-Chief Executive Officer
|
|
|
(Co-Principal Executive Officer)
|
1.
|
I have reviewed this annual report on Form 10-K of Markel Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
February 28, 2019
|
|
/s/ Jeremy A. Noble
|
|
|
Jeremy A. Noble
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
(Principal 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/ Thomas S. Gayner
|
Thomas S. Gayner
|
Co-Chief Executive Officer
|
(Co-Principal Executive Officer)
|
February 28, 2019
|
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/ Richard R. Whitt, III
|
Richard R. Whitt, III
|
Co-Chief Executive Officer
|
(Co-Principal Executive Officer)
|
February 28, 2019
|
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/ Jeremy A. Noble
|
Jeremy A. Noble
|
Senior Vice President and Chief Financial Officer
|
(Principal Financial Officer)
|
February 28, 2019
|