|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
BERMUDA
|
N/A
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
Large accelerated filer
|
þ
|
|
Accelerated filer
|
¨
|
|
Non-accelerated filer
|
¨
|
|
Smaller reporting company
|
☐
|
|
Emerging growth company
|
☐
|
Title of Each Class
|
Trading Symbol(s)
|
Name of Each Exchange on Which Registered
|
|
Ordinary shares, par value $1.00 per share
|
ESGR
|
The NASDAQ Stock Market
|
LLC
|
Depositary Shares, Each Representing a 1/1,000th Interest in a 7.00% Fixed-to-Floating Rate
|
ESGRP
|
The NASDAQ Stock Market
|
LLC
|
Perpetual Non-Cumulative Preferred Share, Series D, Par Value $1.00 Per Share
|
|
|
|
Depositary Shares, Each Representing a 1/1,000th Interest
|
ESGRO
|
The NASDAQ Stock Market
|
LLC
|
in a 7.00% Perpetual Non-Cumulative Preferred Share, Series E, Par Value $1.00 Per Share
|
|
|
|
|
|
|
Page
|
PART I
|
|
|
|
|
|
Item 1.
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
|
|
PART II
|
|
|
|
|
|
Item 1.
|
||
Item 1A.
|
||
Item 2.
|
||
Item 6.
|
CONSOLIDATED FINANCIAL STATEMENTS
|
Page
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
|
(expressed in thousands of U.S. dollars, except share data)
|
||||||
ASSETS
|
|
|
|
||||
Short-term investments, trading, at fair value
|
$
|
46,537
|
|
|
$
|
114,116
|
|
Fixed maturities, trading, at fair value
|
7,635,146
|
|
|
7,248,793
|
|
||
Fixed maturities, available-for-sale, at fair value (amortized cost: 2019 — $61,845; 2018 — $151,433)
|
62,782
|
|
|
151,609
|
|
||
Funds held - directly managed
|
1,232,775
|
|
|
1,198,154
|
|
||
Equities, at fair value
|
522,038
|
|
|
367,125
|
|
||
Other investments, at fair value
|
2,419,512
|
|
|
1,957,757
|
|
||
Equity method investments
|
270,278
|
|
|
204,507
|
|
||
12,189,068
|
|
|
11,242,061
|
|
|||
Cash and cash equivalents
|
1,073,485
|
|
|
602,096
|
|
||
Restricted cash and cash equivalents
|
450,300
|
|
|
380,488
|
|
||
Premiums receivable
|
651,301
|
|
|
787,468
|
|
||
8,737
|
|
|
10,124
|
|
|||
Prepaid reinsurance premiums
|
192,917
|
|
|
198,990
|
|
||
1,500,188
|
|
|
1,290,072
|
|
|||
743,304
|
|
|
739,591
|
|
|||
Funds held by reinsured companies
|
389,507
|
|
|
321,267
|
|
||
Deferred acquisition costs
|
178,208
|
|
|
121,101
|
|
||
217,595
|
|
|
218,725
|
|
|||
Other assets
|
630,232
|
|
|
644,287
|
|
||
TOTAL ASSETS
|
$
|
18,224,842
|
|
|
$
|
16,556,270
|
|
|
|
|
|
||||
LIABILITIES
|
|
|
|
||||
$
|
7,061,385
|
|
|
$
|
6,535,449
|
|
|
2,772,501
|
|
|
2,874,055
|
|
|||
—
|
|
|
105,080
|
|
|||
Unearned premiums
|
890,459
|
|
|
842,618
|
|
||
Insurance and reinsurance balances payable
|
427,368
|
|
|
388,086
|
|
||
9,118
|
|
|
10,542
|
|
|||
1,497,447
|
|
|
861,539
|
|
|||
Other liabilities
|
603,429
|
|
|
566,369
|
|
||
TOTAL LIABILITIES
|
13,261,707
|
|
|
12,183,738
|
|
||
|
|
|
|
||||
|
|
|
|||||
|
|
|
|
||||
435,696
|
|
|
458,543
|
|
|||
|
|
|
|
||||
|
|
|
|||||
Ordinary shares (par value $1 each, issued and outstanding 2019: 21,484,537; 2018: 21,459,997):
|
|
|
|
||||
Voting Ordinary shares (issued and outstanding 2019: 17,974,855; 2018: 17,950,315)
|
17,975
|
|
|
17,950
|
|
||
Non-voting convertible ordinary Series C Shares (issued and outstanding 2019 and 2018: 2,599,672)
|
2,600
|
|
|
2,600
|
|
||
Non-voting convertible ordinary Series E Shares (issued and outstanding 2019 and 2018: 910,010)
|
910
|
|
|
910
|
|
||
Preferred Shares:
|
|
|
|
||||
Series C Preferred Shares (issued and held in treasury 2019 and 2018: 388,571)
|
389
|
|
|
389
|
|
||
Series D Preferred Shares (issued and outstanding 2019 and 2018: 16,000)
|
400,000
|
|
|
400,000
|
|
||
Series E Preferred Shares (issued and outstanding 2019 and 2018: 4,400)
|
110,000
|
|
|
110,000
|
|
||
Treasury shares, at cost (Series C Preferred shares 2019 and 2018: 388,571)
|
(421,559
|
)
|
|
(421,559
|
)
|
||
Additional paid-in capital
|
1,822,202
|
|
|
1,804,664
|
|
||
Accumulated other comprehensive income
|
9,196
|
|
|
10,440
|
|
||
Retained earnings
|
2,573,117
|
|
|
1,976,539
|
|
||
Total Enstar Group Limited Shareholders’ Equity
|
4,514,830
|
|
|
3,901,933
|
|
||
12,609
|
|
|
12,056
|
|
|||
TOTAL SHAREHOLDERS’ EQUITY
|
4,527,439
|
|
|
3,913,989
|
|
||
TOTAL LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS’ EQUITY
|
$
|
18,224,842
|
|
|
$
|
16,556,270
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(expressed in thousands of U.S. dollars)
|
||||||||||||||
NET EARNINGS (LOSS)
|
$
|
238,054
|
|
|
$
|
(145
|
)
|
|
$
|
603,796
|
|
|
$
|
(40,573
|
)
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income, net of tax:
|
|
|
|
|
|
|
|
||||||||
Unrealized holding gains (losses) on fixed income available-for-sale investments arising during the period
|
1,244
|
|
|
(1,351
|
)
|
|
4,907
|
|
|
(1,697
|
)
|
||||
Reclassification adjustment for net realized gains (losses) included in net earnings
|
(4,218
|
)
|
|
21
|
|
|
(4,157
|
)
|
|
51
|
|
||||
Unrealized gains (losses) arising during the period, net of reclassification adjustments
|
(2,974
|
)
|
|
(1,330
|
)
|
|
750
|
|
|
(1,646
|
)
|
||||
Total cumulative translation adjustment
|
(1,038
|
)
|
|
176
|
|
|
(1,839
|
)
|
|
1,401
|
|
||||
Total other comprehensive loss
|
(4,012
|
)
|
|
(1,154
|
)
|
|
(1,089
|
)
|
|
(245
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Comprehensive income (loss)
|
234,042
|
|
|
(1,299
|
)
|
|
602,707
|
|
|
(40,818
|
)
|
||||
Comprehensive loss attributable to noncontrolling interest
|
2,642
|
|
|
8,745
|
|
|
4,706
|
|
|
7,989
|
|
||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO ENSTAR GROUP LIMITED
|
$
|
236,684
|
|
|
$
|
7,446
|
|
|
$
|
607,413
|
|
|
$
|
(32,829
|
)
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(expressed in thousands of U.S. dollars)
|
||||||||||||||
Share Capital — Voting Ordinary Shares
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
$
|
17,958
|
|
|
$
|
16,413
|
|
|
$
|
17,950
|
|
|
$
|
16,402
|
|
Issue of shares
|
17
|
|
|
1,517
|
|
|
25
|
|
|
1,528
|
|
||||
Balance, end of period
|
$
|
17,975
|
|
|
$
|
17,930
|
|
|
$
|
17,975
|
|
|
$
|
17,930
|
|
Share Capital — Non-Voting Convertible Ordinary Series C Shares
|
|
|
|
|
|
|
|
||||||||
Balance, beginning and end of period
|
$
|
2,600
|
|
|
$
|
2,600
|
|
|
$
|
2,600
|
|
|
$
|
2,600
|
|
Share Capital — Non-Voting Convertible Ordinary Series E Shares
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
$
|
910
|
|
|
$
|
405
|
|
|
$
|
910
|
|
|
$
|
405
|
|
Issue of shares
|
—
|
|
|
505
|
|
|
—
|
|
|
505
|
|
||||
Balance, end of period
|
$
|
910
|
|
|
$
|
910
|
|
|
$
|
910
|
|
|
$
|
910
|
|
Share Capital — Series C Convertible Participating Non-Voting Preferred Shares
|
|
|
|
|
|
|
|
||||||||
Balance, beginning and end of period
|
$
|
389
|
|
|
$
|
389
|
|
|
$
|
389
|
|
|
$
|
389
|
|
Share Capital — Series D Preferred Shares
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
$
|
400,000
|
|
|
$
|
—
|
|
|
$
|
400,000
|
|
|
$
|
—
|
|
Issue of shares
|
—
|
|
|
400,000
|
|
|
—
|
|
|
400,000
|
|
||||
Balance, end of period
|
$
|
400,000
|
|
|
$
|
400,000
|
|
|
$
|
400,000
|
|
|
$
|
400,000
|
|
Share Capital — Series E Preferred Shares
|
|
|
|
|
|
|
|
||||||||
Balance, beginning and end of period
|
$
|
110,000
|
|
|
$
|
—
|
|
|
$
|
110,000
|
|
|
$
|
—
|
|
Treasury Shares (Series C Preferred Shares)
|
|
|
|
|
|
|
|
||||||||
Balance, beginning and end of period
|
$
|
(421,559
|
)
|
|
$
|
(421,559
|
)
|
|
$
|
(421,559
|
)
|
|
$
|
(421,559
|
)
|
Additional Paid-in Capital
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
$
|
1,809,107
|
|
|
$
|
1,400,624
|
|
|
$
|
1,804,664
|
|
|
$
|
1,395,067
|
|
Issue of voting ordinary shares
|
455
|
|
|
413,298
|
|
|
921
|
|
|
413,204
|
|
||||
Issuance costs of preferred shares
|
—
|
|
|
(10,518
|
)
|
|
—
|
|
|
(10,518
|
)
|
||||
Amortization of share-based compensation
|
12,640
|
|
|
4,659
|
|
|
16,617
|
|
|
10,310
|
|
||||
Balance, end of period
|
$
|
1,822,202
|
|
|
$
|
1,808,063
|
|
|
$
|
1,822,202
|
|
|
$
|
1,808,063
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
$
|
13,279
|
|
|
$
|
11,403
|
|
|
$
|
10,440
|
|
|
$
|
10,468
|
|
Currency translation adjustment
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
10,183
|
|
|
12,400
|
|
|
10,986
|
|
|
11,171
|
|
||||
Change in currency translation adjustment
|
(1,036
|
)
|
|
181
|
|
|
(1,839
|
)
|
|
1,410
|
|
||||
Balance, end of period
|
9,147
|
|
|
12,581
|
|
|
9,147
|
|
|
12,581
|
|
||||
Defined benefit pension liability
|
|
|
|
|
|
|
|
||||||||
Balance, beginning and end of period
|
(987
|
)
|
|
(3,143
|
)
|
|
(987
|
)
|
|
(3,143
|
)
|
||||
Unrealized gains (losses) on available-for-sale investments
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
4,083
|
|
|
2,146
|
|
|
441
|
|
|
2,440
|
|
||||
Change in unrealized gains (losses) on available-for-sale investments
|
(3,047
|
)
|
|
(980
|
)
|
|
595
|
|
|
(1,274
|
)
|
||||
Balance, end of period
|
1,036
|
|
|
1,166
|
|
|
1,036
|
|
|
1,166
|
|
||||
Balance, end of period
|
$
|
9,196
|
|
|
$
|
10,604
|
|
|
$
|
9,196
|
|
|
$
|
10,604
|
|
Retained Earnings
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
$
|
2,335,028
|
|
|
$
|
2,089,760
|
|
|
$
|
1,976,539
|
|
|
$
|
2,132,912
|
|
Net earnings (losses) attributable to Enstar Group Limited
|
238,054
|
|
|
(145
|
)
|
|
603,796
|
|
|
(40,573
|
)
|
||||
Net loss attributable to noncontrolling interest
|
2,713
|
|
|
8,389
|
|
|
4,861
|
|
|
7,607
|
|
||||
Dividends on preferred shares
|
(8,925
|
)
|
|
—
|
|
|
(18,064
|
)
|
|
—
|
|
||||
Change in redemption value of redeemable noncontrolling interests
|
6,247
|
|
|
480
|
|
|
5,985
|
|
|
111
|
|
||||
Cumulative effect of change in accounting principle
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,573
|
)
|
||||
Balance, end of period
|
$
|
2,573,117
|
|
|
$
|
2,098,484
|
|
|
$
|
2,573,117
|
|
|
$
|
2,098,484
|
|
|
|
|
|
|
|
|
|
Noncontrolling Interest (excludes Redeemable Noncontrolling Interest)
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
$
|
12,452
|
|
|
$
|
9,276
|
|
|
$
|
12,056
|
|
|
$
|
9,264
|
|
Purchase of noncontrolling shareholders' interest in subsidiaries
|
(47
|
)
|
|
—
|
|
|
(47
|
)
|
|
—
|
|
||||
Contribution of capital
|
—
|
|
|
—
|
|
|
—
|
|
|
49
|
|
||||
Net earnings attributable to noncontrolling interest
|
204
|
|
|
451
|
|
|
600
|
|
|
414
|
|
||||
Balance, end of period
|
$
|
12,609
|
|
|
$
|
9,727
|
|
|
$
|
12,609
|
|
|
$
|
9,727
|
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(expressed in thousands of U.S. dollars)
|
||||||
OPERATING ACTIVITIES:
|
|
|
|
||||
Net earnings (loss)
|
$
|
603,796
|
|
|
$
|
(40,573
|
)
|
Adjustments to reconcile net earnings (loss) to cash flows provided by (used in) operating activities:
|
|
|
|
||||
Realized losses (gains) on sale of investments
|
(26,394
|
)
|
|
8,606
|
|
||
Unrealized losses (gains) on investments
|
(704,108
|
)
|
|
188,842
|
|
||
Depreciation and other amortization
|
15,948
|
|
|
19,211
|
|
||
Earnings from equity method investments
|
(26,485
|
)
|
|
(30,342
|
)
|
||
Sales and maturities of trading securities
|
2,785,464
|
|
|
2,105,511
|
|
||
Purchases of trading securities
|
(2,832,963
|
)
|
|
(3,060,227
|
)
|
||
Other non-cash items
|
18,187
|
|
|
10,626
|
|
||
Changes in:
|
|
|
|
||||
Reinsurance balances recoverable
|
(213,977
|
)
|
|
(339,827
|
)
|
||
Funds held by reinsured companies
|
(68,240
|
)
|
|
(84,049
|
)
|
||
Losses and loss adjustment expenses
|
424,794
|
|
|
1,209,709
|
|
||
Policy benefits for life and annuity contracts
|
(104,202
|
)
|
|
(5,059
|
)
|
||
Insurance and reinsurance balances payable
|
38,922
|
|
|
117,741
|
|
||
Unearned premiums
|
47,841
|
|
|
170,849
|
|
||
Premiums receivable
|
136,171
|
|
|
(137,106
|
)
|
||
Other operating assets and liabilities
|
917
|
|
|
(246,462
|
)
|
||
Net cash flows provided by (used in) operating activities
|
95,671
|
|
|
(112,550
|
)
|
||
INVESTING ACTIVITIES:
|
|
|
|
||||
Acquisitions, net of cash acquired
|
1,071
|
|
|
5,657
|
|
||
Sales and maturities of available-for-sale securities
|
90,536
|
|
|
44,112
|
|
||
Purchase of available-for-sale securities
|
(147
|
)
|
|
(9,226
|
)
|
||
Purchase of other investments
|
(286,185
|
)
|
|
(462,336
|
)
|
||
Proceeds from other investments
|
85,848
|
|
|
324,633
|
|
||
Purchase of equity method investments
|
(41,202
|
)
|
|
—
|
|
||
Other investing activities
|
(3,724
|
)
|
|
(7,841
|
)
|
||
Net cash flows used in investing activities
|
(153,803
|
)
|
|
(105,001
|
)
|
||
FINANCING ACTIVITIES:
|
|
|
|
||||
Issuance of preferred shares, net of issuance costs
|
—
|
|
|
389,482
|
|
||
Dividends on preferred shares
|
(18,064
|
)
|
|
—
|
|
||
Contribution by noncontrolling interest
|
—
|
|
|
49
|
|
||
Dividends paid to noncontrolling interest
|
(11,556
|
)
|
|
—
|
|
||
Purchase of noncontrolling shareholders' interest in subsidiaries
|
(47
|
)
|
|
—
|
|
||
Receipt of loans
|
1,050,806
|
|
|
374,069
|
|
||
Repayment of loans
|
(415,370
|
)
|
|
(578,062
|
)
|
||
Net cash flows provided by financing activities
|
605,769
|
|
|
185,538
|
|
||
EFFECT OF EXCHANGE RATE CHANGES ON FOREIGN CURRENCY CASH AND CASH EQUIVALENTS
|
(6,436
|
)
|
|
2,770
|
|
||
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
541,201
|
|
|
(29,243
|
)
|
||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
982,584
|
|
|
1,212,836
|
|
||
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
$
|
1,523,785
|
|
|
$
|
1,183,593
|
|
|
|
|
|
||||
Supplemental Cash Flow Information:
|
|
|
|
||||
Income taxes paid, net of refunds
|
$
|
573
|
|
|
$
|
13,928
|
|
Interest paid
|
$
|
21,246
|
|
|
$
|
16,247
|
|
|
|
|
|
||||
Reconciliation to Consolidated Balance Sheets:
|
|
|
|
||||
Cash and cash equivalents
|
1,073,485
|
|
|
819,709
|
|
||
Restricted cash and cash equivalents
|
450,300
|
|
|
363,884
|
|
||
Cash, cash equivalents and restricted cash
|
$
|
1,523,785
|
|
|
$
|
1,183,593
|
|
•
|
liability for losses and loss adjustment expenses ("LAE");
|
•
|
liability for policy benefits for life contracts;
|
•
|
reinsurance balances recoverable on paid and unpaid losses;
|
•
|
valuation allowances on reinsurance balances recoverable and deferred tax assets;
|
•
|
impairment charges, including other-than-temporary impairments on investment securities classified as available-for-sale, and impairments on goodwill, intangible assets and deferred charge asset;
|
•
|
gross and net premiums written and net premiums earned;
|
•
|
fair value measurements of investments;
|
•
|
fair value estimates associated with accounting for acquisitions;
|
•
|
fair value estimates associated with loss portfolio transfer reinsurance agreements for which we have elected the fair value option; and
|
•
|
redeemable noncontrolling interests.
|
Fair value of Enstar ordinary shares issued
|
|
$
|
414,750
|
|
Fair value of previously held equity method investment
|
|
336,137
|
|
|
Adjustment for the fair value of preexisting relationships
|
|
37,169
|
|
|
Total purchase price
|
|
$
|
788,056
|
|
Net assets acquired at fair value (excluding preexisting relationships)
|
|
$
|
746,320
|
|
Excess of purchase price over fair value of net assets acquired
|
|
$
|
41,736
|
|
Number of Enstar Ordinary shares issued
|
|
2,007,017
|
||
Closing price of Enstar Ordinary shares as of May 14, 2018
|
|
$
|
206.65
|
|
Fair value of Enstar Ordinary shares issued to shareholders of KaylaRe
|
|
$
|
414,750
|
|
Carrying value of previously held equity method investment prior to the close of the transaction
|
|
$
|
320,130
|
|
Price-to-book multiple
|
|
1.05
|
||
Fair value of previously held equity method investment prior to the close of the transaction
|
|
$
|
336,137
|
|
|
|
|
||
Gain recognized on remeasurement of previously held equity method investment to fair value
|
|
$
|
16,007
|
|
ASSETS
|
Carrying value
|
|
Fair value
|
|
Loss on deemed settlement
|
||||||
Funds held by reinsured companies
|
$
|
386,793
|
|
|
$
|
386,793
|
|
|
$
|
—
|
|
Deferred acquisition costs/Value of business acquired
|
33,549
|
|
|
40,268
|
|
|
6,719
|
|
|||
TOTAL ASSETS
|
420,342
|
|
|
427,061
|
|
|
6,719
|
|
|||
LIABILITIES
|
|
|
|
|
|
||||||
Losses and LAE
|
339,747
|
|
|
333,205
|
|
|
(6,542
|
)
|
|||
Unearned premiums
|
105,602
|
|
|
105,602
|
|
|
—
|
|
|||
Insurance and reinsurance balances payable
|
25,897
|
|
|
23,559
|
|
|
(2,338
|
)
|
|||
Other liabilities
|
1,864
|
|
|
1,864
|
|
|
—
|
|
|||
TOTAL LIABILITIES
|
473,110
|
|
|
464,230
|
|
|
(8,880
|
)
|
|||
NET ASSETS (LIABILITIES)
|
$
|
(52,768
|
)
|
|
$
|
(37,169
|
)
|
|
$
|
15,599
|
|
ASSETS
|
|
|
||
Fixed maturities, trading, at fair value
|
|
$
|
126,393
|
|
Other investments, at fair value
|
|
626,476
|
|
|
Total investments
|
|
752,869
|
|
|
Cash and cash equivalents
|
|
5,657
|
|
|
Premiums receivable
|
|
10,965
|
|
|
Deferred acquisition costs
|
|
275
|
|
|
Other assets
|
|
614
|
|
|
TOTAL ASSETS
|
|
$
|
770,380
|
|
LIABILITIES
|
|
|
||
Losses and LAE
|
|
$
|
4,059
|
|
Unearned premiums
|
|
10,984
|
|
|
Insurance and reinsurance balances payable
|
|
13
|
|
|
Other liabilities
|
|
9,004
|
|
|
TOTAL LIABILITIES
|
|
24,060
|
|
|
NET ASSETS ACQUIRED AT FAIR VALUE
|
|
$
|
746,320
|
|
Premiums earned
|
|
$
|
5,381
|
|
Incurred losses and LAE
|
|
(4,960
|
)
|
|
Acquisition costs
|
|
(135
|
)
|
|
Underwriting income
|
|
286
|
|
|
Net investment income
|
|
791
|
|
|
Net unrealized gains
|
|
15,247
|
|
|
Net loss
|
|
$
|
16,324
|
|
|
June 30, 2019
|
||||||||||||||||||
|
Short-term investments, trading
|
|
Fixed maturities, trading
|
|
Fixed maturities, available-for-sale
|
|
Fixed maturities, funds held - directly managed
|
|
Total
|
||||||||||
U.S. government and agency
|
$
|
18,321
|
|
|
$
|
385,640
|
|
|
$
|
—
|
|
|
$
|
107,582
|
|
|
$
|
511,543
|
|
U.K. government
|
1,207
|
|
|
348,601
|
|
|
—
|
|
|
—
|
|
|
349,808
|
|
|||||
Other government
|
91
|
|
|
644,790
|
|
|
33,336
|
|
|
20,535
|
|
|
698,752
|
|
|||||
Corporate
|
24,344
|
|
|
4,485,789
|
|
|
27,381
|
|
|
603,347
|
|
|
5,140,861
|
|
|||||
Municipal
|
—
|
|
|
104,469
|
|
|
2,059
|
|
|
54,901
|
|
|
161,429
|
|
|||||
Residential mortgage-backed
|
—
|
|
|
325,578
|
|
|
6
|
|
|
90,723
|
|
|
416,307
|
|
|||||
Commercial mortgage-backed
|
—
|
|
|
694,455
|
|
|
—
|
|
|
245,961
|
|
|
940,416
|
|
|||||
Asset-backed
|
2,574
|
|
|
645,824
|
|
|
—
|
|
|
84,955
|
|
|
733,353
|
|
|||||
Total fixed maturity and short-term investments
|
$
|
46,537
|
|
|
$
|
7,635,146
|
|
|
$
|
62,782
|
|
|
$
|
1,208,004
|
|
|
$
|
8,952,469
|
|
|
December 31, 2018
|
||||||||||||||||||
|
Short-term investments, trading
|
|
Fixed maturities, trading
|
|
Fixed maturities, available-for-sale
|
|
Fixed maturities, funds held - directly managed
|
|
Total
|
||||||||||
U.S. government and agency
|
$
|
45,885
|
|
|
$
|
389,735
|
|
|
$
|
573
|
|
|
$
|
74,052
|
|
|
$
|
510,245
|
|
U.K. government
|
2,275
|
|
|
298,356
|
|
|
—
|
|
|
—
|
|
|
300,631
|
|
|||||
Other government
|
19,064
|
|
|
679,525
|
|
|
73,185
|
|
|
22,036
|
|
|
793,810
|
|
|||||
Corporate
|
44,900
|
|
|
4,081,793
|
|
|
75,359
|
|
|
637,788
|
|
|
4,839,840
|
|
|||||
Municipal
|
—
|
|
|
73,856
|
|
|
2,480
|
|
|
53,929
|
|
|
130,265
|
|
|||||
Residential mortgage-backed
|
—
|
|
|
682,962
|
|
|
12
|
|
|
90,583
|
|
|
773,557
|
|
|||||
Commercial mortgage-backed
|
—
|
|
|
488,598
|
|
|
—
|
|
|
224,465
|
|
|
713,063
|
|
|||||
Asset-backed
|
1,992
|
|
|
553,968
|
|
|
—
|
|
|
80,521
|
|
|
636,481
|
|
|||||
Total fixed maturity and short-term investments
|
$
|
114,116
|
|
|
$
|
7,248,793
|
|
|
$
|
151,609
|
|
|
$
|
1,183,374
|
|
|
$
|
8,697,892
|
|
As of June 30, 2019
|
|
Amortized
Cost
|
|
Fair Value
|
|
% of Total
Fair
Value
|
|||||
One year or less
|
|
$
|
374,739
|
|
|
$
|
370,717
|
|
|
4.1
|
%
|
More than one year through two years
|
|
643,039
|
|
|
642,041
|
|
|
7.2
|
%
|
||
More than two years through five years
|
|
2,049,209
|
|
|
2,073,343
|
|
|
23.2
|
%
|
||
More than five years through ten years
|
|
1,965,094
|
|
|
2,033,967
|
|
|
22.7
|
%
|
||
More than ten years
|
|
1,652,675
|
|
|
1,742,325
|
|
|
19.4
|
%
|
||
Residential mortgage-backed
|
|
408,353
|
|
|
416,307
|
|
|
4.7
|
%
|
||
Commercial mortgage-backed
|
|
919,921
|
|
|
940,416
|
|
|
10.5
|
%
|
||
Asset-backed
|
|
733,390
|
|
|
733,353
|
|
|
8.2
|
%
|
||
|
|
$
|
8,746,420
|
|
|
$
|
8,952,469
|
|
|
100.0
|
%
|
|
|
Amortized
Cost
|
|
Fair Value
|
|
% of Total
|
|
AAA
Rated
|
|
AA Rated
|
|
A Rated
|
|
BBB
Rated
|
|
Non-
Investment
Grade
|
|
Not Rated
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
U.S. government and agency
|
|
$
|
503,213
|
|
|
$
|
511,543
|
|
|
5.7
|
%
|
|
$
|
511,476
|
|
|
$
|
67
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
U.K. government
|
|
334,635
|
|
|
349,808
|
|
|
3.9
|
%
|
|
3,532
|
|
|
346,276
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Other government
|
|
684,461
|
|
|
698,752
|
|
|
7.8
|
%
|
|
271,432
|
|
|
172,558
|
|
|
57,490
|
|
|
160,766
|
|
|
36,506
|
|
|
—
|
|
||||||||
Corporate
|
|
5,010,376
|
|
|
5,140,861
|
|
|
57.4
|
%
|
|
112,084
|
|
|
498,379
|
|
|
2,524,300
|
|
|
1,803,166
|
|
|
202,581
|
|
|
351
|
|
||||||||
Municipal
|
|
152,071
|
|
|
161,429
|
|
|
1.8
|
%
|
|
12,030
|
|
|
76,305
|
|
|
54,748
|
|
|
18,346
|
|
|
—
|
|
|
—
|
|
||||||||
Residential mortgage-backed
|
|
408,353
|
|
|
416,307
|
|
|
4.7
|
%
|
|
307,768
|
|
|
42,936
|
|
|
2,365
|
|
|
3,522
|
|
|
52,014
|
|
|
7,702
|
|
||||||||
Commercial mortgage-backed
|
|
919,921
|
|
|
940,416
|
|
|
10.5
|
%
|
|
653,516
|
|
|
99,824
|
|
|
104,021
|
|
|
65,044
|
|
|
8,296
|
|
|
9,715
|
|
||||||||
Asset-backed
|
|
733,390
|
|
|
733,353
|
|
|
8.2
|
%
|
|
301,518
|
|
|
104,211
|
|
|
175,680
|
|
|
133,517
|
|
|
17,170
|
|
|
1,257
|
|
||||||||
Total
|
|
$
|
8,746,420
|
|
|
$
|
8,952,469
|
|
|
100.0
|
%
|
|
$
|
2,173,356
|
|
|
$
|
1,340,556
|
|
|
$
|
2,918,604
|
|
|
$
|
2,184,361
|
|
|
$
|
316,567
|
|
|
$
|
19,025
|
|
% of total fair value
|
|
|
|
|
|
|
|
24.3
|
%
|
|
15.0
|
%
|
|
32.6
|
%
|
|
24.4
|
%
|
|
3.5
|
%
|
|
0.2
|
%
|
As of June 30, 2019
|
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses (Non-OTTI)
|
|
Fair Value
|
||||||||
Other government
|
|
$
|
32,438
|
|
|
$
|
1,179
|
|
|
$
|
(281
|
)
|
|
$
|
33,336
|
|
Corporate
|
|
27,349
|
|
|
442
|
|
|
(410
|
)
|
|
27,381
|
|
||||
Municipal
|
|
2,052
|
|
|
10
|
|
|
(3
|
)
|
|
2,059
|
|
||||
Residential mortgage-backed
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
||||
|
|
$
|
61,845
|
|
|
$
|
1,631
|
|
|
$
|
(694
|
)
|
|
$
|
62,782
|
|
As of December 31, 2018
|
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses (Non-OTTI)
|
|
Fair Value
|
||||||||
U.S. government and agency
|
|
$
|
576
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
573
|
|
Other government
|
|
72,811
|
|
|
1,219
|
|
|
(845
|
)
|
|
73,185
|
|
||||
Corporate
|
|
75,535
|
|
|
1,006
|
|
|
(1,182
|
)
|
|
75,359
|
|
||||
Municipal
|
|
2,499
|
|
|
—
|
|
|
(19
|
)
|
|
2,480
|
|
||||
Residential mortgage-backed
|
|
12
|
|
|
—
|
|
|
—
|
|
|
12
|
|
||||
|
|
$
|
151,433
|
|
|
$
|
2,225
|
|
|
$
|
(2,049
|
)
|
|
$
|
151,609
|
|
|
|
12 Months or Greater
|
|
Less Than 12 Months
|
|
Total
|
||||||||||||||||||
As of December 31, 2018
|
|
Fair
Value
|
|
Gross Unrealized
Losses
|
|
Fair
Value
|
|
Gross Unrealized
Losses
|
|
Fair
Value
|
|
Gross Unrealized
Losses
|
||||||||||||
Fixed maturity investments, at fair value
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government and agency
|
|
$
|
573
|
|
|
$
|
(3
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
573
|
|
|
$
|
(3
|
)
|
Other government
|
|
7,351
|
|
|
(345
|
)
|
|
11,000
|
|
|
(500
|
)
|
|
18,351
|
|
|
(845
|
)
|
||||||
Corporate
|
|
11,888
|
|
|
(629
|
)
|
|
25,227
|
|
|
(553
|
)
|
|
37,115
|
|
|
(1,182
|
)
|
||||||
Municipal
|
|
1,783
|
|
|
(18
|
)
|
|
283
|
|
|
(1
|
)
|
|
2,066
|
|
|
(19
|
)
|
||||||
Residential mortgage-backed
|
|
12
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|
—
|
|
||||||
Total fixed maturity investments
|
|
$
|
21,607
|
|
|
$
|
(995
|
)
|
|
$
|
36,510
|
|
|
$
|
(1,054
|
)
|
|
$
|
58,117
|
|
|
$
|
(2,049
|
)
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
Publicly traded equity investments in common and preferred stocks
|
$
|
206,585
|
|
|
$
|
138,415
|
|
Exchange-traded fund
|
86,059
|
|
|
—
|
|
||
Privately held equity investments in common and preferred stocks
|
229,394
|
|
|
228,710
|
|
||
|
$
|
522,038
|
|
|
$
|
367,125
|
|
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
Hedge funds
|
|
$
|
1,006,221
|
|
|
$
|
852,584
|
|
Fixed income funds
|
|
598,015
|
|
|
403,858
|
|
||
Equity funds
|
|
378,824
|
|
|
333,681
|
|
||
Private equity funds
|
|
244,950
|
|
|
248,628
|
|
||
CLO equities
|
|
50,138
|
|
|
39,052
|
|
||
CLO equity fund
|
|
66,311
|
|
|
37,260
|
|
||
Private credit funds
|
|
56,827
|
|
|
33,381
|
|
||
Other
|
|
18,226
|
|
|
9,313
|
|
||
|
|
$
|
2,419,512
|
|
|
$
|
1,957,757
|
|
•
|
Hedge funds may invest in a wide range of instruments, including debt and equity securities, and utilize various sophisticated strategies to achieve their objectives. We invest in a mixture of fixed income, equity and multi-strategy hedge funds.
|
•
|
Fixed income funds comprise a number of positions in diversified fixed income funds that are managed by third-party managers. Underlying investments vary from high-grade corporate bonds to non-investment grade senior secured loans and bonds, but are generally invested in liquid fixed income markets. These funds have regularly published prices.
|
•
|
Equity funds invest in a diversified portfolio of U.S. and international publicly-traded equity securities.
|
•
|
Private equity funds invest primarily in the financial services industry.
|
•
|
CLO equities comprise investments in the equity tranches of term-financed securitizations of diversified pools of corporate bank loans.
|
•
|
CLO equity fund invests primarily in the equity tranches of term-financed securitizations of diversified pools of corporate bank loans.
|
•
|
Private credit funds invest in direct senior or collateralized loans.
|
•
|
Others comprise various investments including real estate debt funds that invest primarily in European real estate, call options on equities and a fund that provides loans to educational institutions throughout the United States and its territories.
|
|
|
Less than 1 Year
|
|
1-2 years
|
|
2-3 years
|
|
More than 3 years
|
|
Not Eligible/ Restricted
|
|
Redemption Frequency
|
||||||||||
Hedge funds
|
|
$
|
228,700
|
|
|
$
|
100,372
|
|
|
$
|
498,346
|
|
|
$
|
102,600
|
|
|
$
|
76,203
|
|
|
Monthly to Bi-annually
|
Fixed income funds
|
|
517,213
|
|
|
—
|
|
|
75,146
|
|
|
—
|
|
|
5,656
|
|
|
Daily to Quarterly
|
|||||
Equity funds
|
|
378,824
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Daily to Quarterly
|
|||||
Private equity funds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
244,950
|
|
|
N/A
|
|||||
CLO equities
|
|
50,138
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
N/A
|
|||||
CLO equity fund
|
|
41,455
|
|
|
—
|
|
|
24,856
|
|
|
—
|
|
|
—
|
|
|
Quarterly
|
|||||
Private credit funds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
56,827
|
|
|
N/A
|
|||||
Other
|
|
1,904
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,322
|
|
|
N/A
|
|||||
|
|
$
|
1,218,234
|
|
|
$
|
100,372
|
|
|
$
|
598,348
|
|
|
$
|
102,600
|
|
|
$
|
399,958
|
|
|
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||
|
|
Investment
|
|
Ownership %
|
|
Carrying Value
|
|
Investment
|
|
Ownership %
|
|
Carrying Value
|
||||||||||
Enhanzed Re
|
|
$
|
123,240
|
|
|
47.4
|
%
|
|
$
|
131,376
|
|
|
$
|
94,800
|
|
|
47.4
|
%
|
|
$
|
94,800
|
|
Citco
|
|
50,000
|
|
|
31.9
|
%
|
|
51,295
|
|
|
50,000
|
|
|
31.9
|
%
|
|
50,812
|
|
||||
Monument
|
|
26,600
|
|
|
26.6
|
%
|
|
54,442
|
|
|
26,600
|
|
|
26.6
|
%
|
|
42,193
|
|
||||
Clear Spring
|
|
11,210
|
|
|
20.0
|
%
|
|
9,700
|
|
|
11,210
|
|
|
20.0
|
%
|
|
10,070
|
|
||||
Other
|
|
27,762
|
|
|
~30%
|
|
|
23,465
|
|
|
15,250
|
|
|
~30%
|
|
|
6,632
|
|
||||
|
|
$
|
238,812
|
|
|
|
|
$
|
270,278
|
|
|
$
|
197,860
|
|
|
|
|
$
|
204,507
|
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
Fixed maturity investments, trading
|
$
|
1,208,004
|
|
|
$
|
1,183,374
|
|
Other assets
|
24,771
|
|
|
14,780
|
|
||
|
$
|
1,232,775
|
|
|
$
|
1,198,154
|
|
|
June 30,
2019 |
|
December 31,
2018 |
||||||||||||||||||||
|
Funds held - Directly Managed - Fair Value Option
|
|
Funds held - Directly Managed - Variable Return
|
|
Total
|
|
Funds held - Directly Managed - Fair Value Option
|
|
Funds held - Directly Managed - Variable Return
|
|
Total
|
||||||||||||
Fixed maturity investments, at amortized cost
|
$
|
180,813
|
|
|
$
|
993,637
|
|
|
$
|
1,174,450
|
|
|
$
|
179,670
|
|
|
$
|
1,044,377
|
|
|
$
|
1,224,047
|
|
Net unrealized gains (losses):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Change in fair value - fair value option accounting
|
4,238
|
|
|
—
|
|
|
4,238
|
|
|
(2,733
|
)
|
|
—
|
|
|
(2,733
|
)
|
||||||
Change in fair value - embedded derivative accounting
|
—
|
|
|
29,316
|
|
|
29,316
|
|
|
—
|
|
|
(37,940
|
)
|
|
(37,940
|
)
|
||||||
Fixed maturity investments within funds held - directly managed, at fair value
|
$
|
185,051
|
|
|
$
|
1,022,953
|
|
|
$
|
1,208,004
|
|
|
$
|
176,937
|
|
|
$
|
1,006,437
|
|
|
$
|
1,183,374
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Fixed maturity investments
|
$
|
58,875
|
|
|
$
|
48,147
|
|
|
$
|
116,945
|
|
|
$
|
92,035
|
|
Short-term investments and cash and cash equivalents
|
4,452
|
|
|
3,096
|
|
|
8,312
|
|
|
5,178
|
|
||||
Funds held
|
1,657
|
|
|
2,754
|
|
|
7,455
|
|
|
5,883
|
|
||||
Funds held - directly managed
|
9,611
|
|
|
9,588
|
|
|
19,361
|
|
|
18,214
|
|
||||
Investment income from fixed maturities and cash and cash equivalents
|
74,595
|
|
|
63,585
|
|
|
152,073
|
|
|
121,310
|
|
||||
Equity investments
|
3,422
|
|
|
1,352
|
|
|
6,802
|
|
|
2,842
|
|
||||
Other investments
|
2,503
|
|
|
2,962
|
|
|
4,617
|
|
|
6,276
|
|
||||
Life settlements and other
|
—
|
|
|
1,116
|
|
|
—
|
|
|
7,775
|
|
||||
Investment income from equities and other investments
|
5,925
|
|
|
5,430
|
|
|
11,419
|
|
|
16,893
|
|
||||
Gross investment income
|
80,520
|
|
|
69,015
|
|
|
163,492
|
|
|
138,203
|
|
||||
Investment expenses
|
(2,788
|
)
|
|
(2,546
|
)
|
|
(7,064
|
)
|
|
(5,415
|
)
|
||||
Net investment income
|
$
|
77,732
|
|
|
$
|
66,469
|
|
|
$
|
156,428
|
|
|
$
|
132,788
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30,
|
|
June 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net realized gains (losses) on sale:
|
|
|
|
|
|
|
|
|
||||||||
Gross realized gains on fixed maturity securities, available-for-sale
|
|
$
|
4,445
|
|
|
$
|
20
|
|
|
$
|
4,449
|
|
|
$
|
27
|
|
Gross realized losses on fixed maturity securities, available-for-sale
|
|
(227
|
)
|
|
(41
|
)
|
|
(292
|
)
|
|
(78
|
)
|
||||
Net realized gains (losses) on fixed maturity securities, trading
|
|
21,542
|
|
|
(3,566
|
)
|
|
20,931
|
|
|
(10,513
|
)
|
||||
Net realized gains (losses) on funds held - directly managed
|
|
244
|
|
|
(1,041
|
)
|
|
(1,362
|
)
|
|
(945
|
)
|
||||
Net realized gains on equity investments
|
|
120
|
|
|
2,000
|
|
|
2,668
|
|
|
2,903
|
|
||||
Total net realized gains (losses) on sale
|
|
$
|
26,124
|
|
|
$
|
(2,628
|
)
|
|
$
|
26,394
|
|
|
$
|
(8,606
|
)
|
Net unrealized gains (losses):
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities, trading
|
|
$
|
133,405
|
|
|
$
|
(45,967
|
)
|
|
$
|
342,872
|
|
|
$
|
(146,268
|
)
|
Fixed maturity securities in funds held - directly managed portfolios
|
|
35,267
|
|
|
(14,101
|
)
|
|
74,229
|
|
|
(45,025
|
)
|
||||
Equity investments
|
|
13,826
|
|
|
487
|
|
|
21,209
|
|
|
4,322
|
|
||||
Other Investments
|
|
61,089
|
|
|
7,791
|
|
|
265,798
|
|
|
(1,871
|
)
|
||||
Total net unrealized gains (losses)
|
|
243,587
|
|
|
(51,790
|
)
|
|
704,108
|
|
|
(188,842
|
)
|
||||
Net realized and unrealized gains (losses)
|
|
$
|
269,711
|
|
|
$
|
(54,418
|
)
|
|
$
|
730,502
|
|
|
$
|
(197,448
|
)
|
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
Collateral in trust for third party agreements
|
|
$
|
4,347,870
|
|
|
$
|
4,336,752
|
|
Assets on deposit with regulatory authorities
|
|
594,062
|
|
|
579,048
|
|
||
Collateral for secured letter of credit facilities
|
|
130,226
|
|
|
127,841
|
|
||
Funds at Lloyd's (1)
|
|
749,438
|
|
|
354,589
|
|
||
|
|
$
|
5,821,596
|
|
|
$
|
5,398,230
|
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
|
|
|
Fair Value
|
|
|
|
Fair Value
|
||||||||||||||||
|
|
Gross Notional Amount
|
|
Assets
|
|
Liabilities
|
|
Gross Notional Amount
|
|
Assets
|
|
Liabilities
|
||||||||||||
Foreign currency forward - AUD
|
|
$
|
43,466
|
|
|
$
|
45
|
|
|
$
|
798
|
|
|
$
|
42,258
|
|
|
$
|
1,377
|
|
|
$
|
—
|
|
Foreign currency forward - EUR
|
|
125,284
|
|
|
401
|
|
|
2,277
|
|
|
66,422
|
|
|
238
|
|
|
300
|
|
||||||
Foreign currency forward - GBP
|
|
242,478
|
|
|
169
|
|
|
1,591
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total qualifying hedges
|
|
$
|
411,228
|
|
|
$
|
615
|
|
|
$
|
4,666
|
|
|
$
|
108,680
|
|
|
$
|
1,615
|
|
|
$
|
300
|
|
|
|
Amount of Gains (Losses) Deferred in AOCI
|
||||||||||||||
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30,
|
|
June 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Foreign currency forward - AUD
|
|
$
|
473
|
|
|
$
|
1,078
|
|
|
$
|
146
|
|
|
$
|
1,608
|
|
Foreign currency forward - EUR
|
|
(1,559
|
)
|
|
—
|
|
|
296
|
|
|
—
|
|
||||
Foreign currency forward - GBP
|
|
(1,591
|
)
|
|
—
|
|
|
(1,591
|
)
|
|
—
|
|
||||
Net gains (losses) on qualifying derivative hedges
|
|
$
|
(2,677
|
)
|
|
$
|
1,078
|
|
|
$
|
(1,149
|
)
|
|
$
|
1,608
|
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
|
|
|
Fair Value
|
|
|
|
Fair Value
|
||||||||||||||||
|
|
Gross Notional Amount
|
|
Assets
|
|
Liabilities
|
|
Gross Notional Amount
|
|
Assets
|
|
Liabilities
|
||||||||||||
Foreign currency forward - AUD
|
|
$
|
29,094
|
|
|
$
|
30
|
|
|
$
|
535
|
|
|
$
|
45,427
|
|
|
$
|
1,952
|
|
|
$
|
310
|
|
Foreign currency forward - CAD
|
|
122,814
|
|
|
245
|
|
|
3,431
|
|
|
55,050
|
|
|
1,441
|
|
|
—
|
|
||||||
Foreign currency forward - EUR
|
|
42,026
|
|
|
134
|
|
|
764
|
|
|
54,282
|
|
|
139
|
|
|
301
|
|
||||||
Foreign currency forward - GBP
|
|
262,917
|
|
|
1,065
|
|
|
—
|
|
|
256,959
|
|
|
1,554
|
|
|
72
|
|
||||||
Total non-qualifying hedges
|
|
$
|
456,851
|
|
|
$
|
1,474
|
|
|
$
|
4,730
|
|
|
$
|
411,718
|
|
|
$
|
5,086
|
|
|
$
|
683
|
|
|
|
Gains (Losses) on non-qualifying-hedges included in net earnings
|
||||||||||||||
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Foreign currency forward - AUD
|
|
$
|
1,327
|
|
|
$
|
1,514
|
|
|
$
|
562
|
|
|
$
|
2,496
|
|
Foreign currency forward - CAD
|
|
(2,493
|
)
|
|
5,207
|
|
|
(2,492
|
)
|
|
7,247
|
|
||||
Foreign currency forward - EUR
|
|
(334
|
)
|
|
1,624
|
|
|
871
|
|
|
1,357
|
|
||||
Foreign currency forward - GBP
|
|
6,370
|
|
|
11,077
|
|
|
2,311
|
|
|
$
|
4,235
|
|
|||
Net gains on non-qualifying hedges
|
|
$
|
4,870
|
|
|
$
|
19,422
|
|
|
$
|
1,252
|
|
|
$
|
15,335
|
|
|
|
June 30, 2019
|
||||||||||||||
|
|
Non-life
Run-off
|
|
Atrium
|
|
StarStone
|
|
Total
|
||||||||
Recoverable from reinsurers on unpaid:
|
|
|
|
|
|
|
|
|
||||||||
Outstanding losses
|
|
$
|
981,904
|
|
|
$
|
9,914
|
|
|
$
|
299,733
|
|
|
$
|
1,291,551
|
|
IBNR
|
|
658,911
|
|
|
19,056
|
|
|
197,825
|
|
|
875,792
|
|
||||
Fair value adjustments - acquired companies
|
|
(13,265
|
)
|
|
636
|
|
|
(1,593
|
)
|
|
(14,222
|
)
|
||||
Fair value adjustments - fair value option
|
|
(93,123
|
)
|
|
—
|
|
|
—
|
|
|
(93,123
|
)
|
||||
Total reinsurance reserves recoverable
|
|
1,534,427
|
|
|
29,606
|
|
|
495,965
|
|
|
2,059,998
|
|
||||
Paid losses recoverable
|
|
135,316
|
|
|
1,600
|
|
|
46,578
|
|
|
183,494
|
|
||||
Total
|
|
$
|
1,669,743
|
|
|
$
|
31,206
|
|
|
$
|
542,543
|
|
|
$
|
2,243,492
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciliation to Consolidated Balance Sheet:
|
|
|
|
|
|
|
|
|
||||||||
Reinsurance balances recoverable on paid and unpaid losses
|
|
$
|
926,439
|
|
|
$
|
31,206
|
|
|
$
|
542,543
|
|
|
$
|
1,500,188
|
|
Reinsurance balances recoverable on paid and unpaid losses - fair value option
|
|
743,304
|
|
|
—
|
|
|
—
|
|
|
743,304
|
|
||||
Total
|
|
$
|
1,669,743
|
|
|
$
|
31,206
|
|
|
$
|
542,543
|
|
|
$
|
2,243,492
|
|
|
|
December 31, 2018
|
||||||||||||||
|
|
Non-life
Run-off
|
|
Atrium
|
|
StarStone
|
|
Total
|
||||||||
Recoverable from reinsurers on unpaid:
|
|
|
|
|
|
|
|
|
||||||||
Outstanding losses
|
|
$
|
901,772
|
|
|
$
|
18,891
|
|
|
$
|
263,065
|
|
|
$
|
1,183,728
|
|
IBNR
|
|
609,434
|
|
|
19,247
|
|
|
201,784
|
|
|
830,465
|
|
||||
Fair value adjustments - acquired companies
|
|
(14,344
|
)
|
|
630
|
|
|
(1,899
|
)
|
|
(15,613
|
)
|
||||
Fair value adjustments - fair value option
|
|
(130,739
|
)
|
|
—
|
|
|
—
|
|
|
(130,739
|
)
|
||||
Total reinsurance reserves recoverable
|
|
1,366,123
|
|
|
38,768
|
|
|
462,950
|
|
|
1,867,841
|
|
||||
Paid losses recoverable
|
|
138,265
|
|
|
(256
|
)
|
|
23,813
|
|
|
161,822
|
|
||||
Total
|
|
$
|
1,504,388
|
|
|
$
|
38,512
|
|
|
$
|
486,763
|
|
|
$
|
2,029,663
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciliation to Consolidated Balance Sheet:
|
|
|
|
|
|
|
|
|
||||||||
Reinsurance balances recoverable on paid and unpaid losses
|
|
$
|
764,797
|
|
|
$
|
38,512
|
|
|
$
|
486,763
|
|
|
$
|
1,290,072
|
|
Reinsurance balances recoverable on paid and unpaid losses - fair value option
|
|
739,591
|
|
|
—
|
|
|
—
|
|
|
739,591
|
|
||||
Total
|
|
$
|
1,504,388
|
|
|
$
|
38,512
|
|
|
$
|
486,763
|
|
|
$
|
2,029,663
|
|
|
June 30, 2019
|
|||||||||||||||||
|
Non-life
Run-off |
|
Atrium
|
|
StarStone
|
|
Total
|
|
% of
Total |
|||||||||
Top ten reinsurers
|
$
|
1,155,937
|
|
|
$
|
22,858
|
|
|
$
|
330,074
|
|
|
$
|
1,508,869
|
|
|
67.3
|
%
|
Other reinsurers > $1 million
|
500,876
|
|
|
7,750
|
|
|
208,832
|
|
|
717,458
|
|
|
32.0
|
%
|
||||
Other reinsurers < $1 million
|
12,930
|
|
|
598
|
|
|
3,637
|
|
|
17,165
|
|
|
0.7
|
%
|
||||
Total
|
$
|
1,669,743
|
|
|
$
|
31,206
|
|
|
$
|
542,543
|
|
|
$
|
2,243,492
|
|
|
100.0
|
%
|
|
December 31, 2018
|
|||||||||||||||||
|
Non-life
Run-off |
|
Atrium
|
|
StarStone
|
|
Total
|
|
% of
Total |
|||||||||
Top ten reinsurers
|
$
|
1,124,079
|
|
|
$
|
25,239
|
|
|
$
|
263,192
|
|
|
$
|
1,412,510
|
|
|
69.6
|
%
|
Other reinsurers > $1 million
|
364,098
|
|
|
12,091
|
|
|
220,123
|
|
|
596,312
|
|
|
29.4
|
%
|
||||
Other reinsurers < $1 million
|
16,211
|
|
|
1,182
|
|
|
3,448
|
|
|
20,841
|
|
|
1.0
|
%
|
||||
Total
|
$
|
1,504,388
|
|
|
$
|
38,512
|
|
|
$
|
486,763
|
|
|
$
|
2,029,663
|
|
|
100.0
|
%
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Information regarding top ten reinsurers:
|
|
|
|
||||
Number of top 10 reinsurers rated A- or better
|
8
|
|
|
7
|
|
||
Number of top 10 non-rated reinsurers (1)
|
2
|
|
|
3
|
|
||
|
|
|
|
||||
Top 10 rated A- or better reinsurers recoverables
|
$
|
1,275,998
|
|
|
$
|
1,096,272
|
|
Top 10 collaterized non-rated reinsurers recoverables (1)
|
232,871
|
|
|
316,238
|
|
||
|
$
|
1,508,869
|
|
|
$
|
1,412,510
|
|
|
|
|
|
||||
Single reinsurers that represent 10% or more of total reinsurance balance recoverables as of June 30, 2019:
|
|
|
|
||||
|
|
|
|
||||
Hannover Ruck SE (2)
|
$
|
299,255
|
|
|
$
|
279,723
|
|
Lloyd's Syndicates (3)
|
$
|
389,118
|
|
|
$
|
334,509
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||||||
|
Gross
|
|
Provisions for Bad Debt
|
|
Net
|
|
Provisions as a
% of Gross |
|
Gross
|
|
Provisions for Bad Debt
|
|
Net
|
|
Provisions as a
% of Gross |
||||||||||||||
Reinsurers rated A- or above
|
$
|
1,855,541
|
|
|
$
|
53,134
|
|
|
$
|
1,802,407
|
|
|
2.9
|
%
|
|
$
|
1,612,464
|
|
|
$
|
51,519
|
|
|
$
|
1,560,945
|
|
|
3.2
|
%
|
Reinsurers rated below A-, secured
|
408,729
|
|
|
—
|
|
|
408,729
|
|
|
—
|
%
|
|
430,852
|
|
|
—
|
|
|
430,852
|
|
|
—
|
%
|
||||||
Reinsurers rated below A-, unsecured
|
139,956
|
|
|
107,600
|
|
|
32,356
|
|
|
76.9
|
%
|
|
143,079
|
|
|
105,213
|
|
|
37,866
|
|
|
73.5
|
%
|
||||||
Total
|
$
|
2,404,226
|
|
|
$
|
160,734
|
|
|
$
|
2,243,492
|
|
|
6.7
|
%
|
|
$
|
2,186,395
|
|
|
$
|
156,732
|
|
|
$
|
2,029,663
|
|
|
7.2
|
%
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Beginning carrying value
|
$
|
100,154
|
|
|
$
|
75,111
|
|
|
$
|
86,585
|
|
|
$
|
80,192
|
|
Recorded during the period
|
2,874
|
|
|
—
|
|
|
23,506
|
|
|
—
|
|
||||
Amortization
|
(3,934
|
)
|
|
(3,718
|
)
|
|
(10,997
|
)
|
|
(8,799
|
)
|
||||
Ending carrying value
|
$
|
99,094
|
|
|
$
|
71,393
|
|
|
$
|
99,094
|
|
|
$
|
71,393
|
|
|
June 30, 2019
|
||||||||||||||||||
|
Non-life
Run-off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
Outstanding losses
|
$
|
4,503,652
|
|
|
$
|
86,045
|
|
|
$
|
881,147
|
|
|
$
|
7,406
|
|
|
$
|
5,478,250
|
|
IBNR
|
3,412,605
|
|
|
129,886
|
|
|
875,369
|
|
|
16,220
|
|
|
4,434,080
|
|
|||||
Fair value adjustments - acquired companies
|
(201,659
|
)
|
|
4,426
|
|
|
(392
|
)
|
|
—
|
|
|
(197,625
|
)
|
|||||
Fair value adjustments - fair value option
|
(243,602
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(243,602
|
)
|
|||||
ULAE
|
332,667
|
|
|
2,219
|
|
|
27,897
|
|
|
—
|
|
|
362,783
|
|
|||||
Total
|
$
|
7,803,663
|
|
|
$
|
222,576
|
|
|
$
|
1,784,021
|
|
|
$
|
23,626
|
|
|
$
|
9,833,886
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reconciliation to Consolidated Balance Sheet:
|
|
|
|
|
|
|
|
|
|
||||||||||
Loss and loss adjustment expenses
|
$
|
5,031,162
|
|
|
$
|
222,576
|
|
|
$
|
1,784,021
|
|
|
$
|
23,626
|
|
|
$
|
7,061,385
|
|
Loss and loss adjustment expenses, at fair value
|
2,772,501
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,772,501
|
|
|||||
Total
|
$
|
7,803,663
|
|
|
$
|
222,576
|
|
|
$
|
1,784,021
|
|
|
$
|
23,626
|
|
|
$
|
9,833,886
|
|
|
December 31, 2018
|
||||||||||||||||||
|
Non-life
Run-off |
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
Outstanding losses
|
$
|
4,271,769
|
|
|
$
|
94,885
|
|
|
$
|
796,194
|
|
|
$
|
6,052
|
|
|
$
|
5,168,900
|
|
IBNR
|
3,527,767
|
|
|
140,521
|
|
|
787,894
|
|
|
12,809
|
|
|
4,468,991
|
|
|||||
Fair value adjustments - acquired companies
|
(217,527
|
)
|
|
3,476
|
|
|
(467
|
)
|
|
—
|
|
|
(214,518
|
)
|
|||||
Fair value adjustments - fair value option
|
(374,752
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(374,752
|
)
|
|||||
ULAE
|
333,405
|
|
|
2,402
|
|
|
25,076
|
|
|
—
|
|
|
360,883
|
|
|||||
Total
|
$
|
7,540,662
|
|
|
$
|
241,284
|
|
|
$
|
1,608,697
|
|
|
$
|
18,861
|
|
|
$
|
9,409,504
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reconciliation to Consolidated Balance Sheet:
|
|
|
|
|
|
|
|
|
|
||||||||||
Loss and loss adjustment expenses
|
$
|
4,666,607
|
|
|
$
|
241,284
|
|
|
$
|
1,608,697
|
|
|
$
|
18,861
|
|
|
$
|
6,535,449
|
|
Loss and loss adjustment expenses, at fair value
|
2,874,055
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,874,055
|
|
|||||
Total
|
$
|
7,540,662
|
|
|
$
|
241,284
|
|
|
$
|
1,608,697
|
|
|
$
|
18,861
|
|
|
$
|
9,409,504
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Balance as of beginning of period
|
$
|
10,096,022
|
|
|
$
|
8,986,070
|
|
|
$
|
9,409,504
|
|
|
$
|
7,398,088
|
|
Less: reinsurance reserves recoverable
|
2,077,923
|
|
|
2,217,033
|
|
|
1,867,841
|
|
|
1,870,033
|
|
||||
Less: deferred charge assets on retroactive reinsurance
|
100,154
|
|
|
75,111
|
|
|
86,585
|
|
|
80,192
|
|
||||
Net balance as of beginning of period
|
7,917,945
|
|
|
6,693,926
|
|
|
7,455,078
|
|
|
5,447,863
|
|
||||
Net incurred losses and LAE:
|
|
|
|
|
|
|
|
||||||||
Current period
|
203,147
|
|
|
153,860
|
|
|
420,413
|
|
|
249,014
|
|
||||
Prior periods
|
13,191
|
|
|
(61,041)
|
|
|
108,329
|
|
|
(136,661
|
)
|
||||
Total net incurred losses and LAE
|
216,338
|
|
|
92,819
|
|
|
528,742
|
|
|
112,353
|
|
||||
Net paid losses:
|
|
|
|
|
|
|
|
||||||||
Current period
|
(45,641
|
)
|
|
(30,474)
|
|
|
(73,670
|
)
|
|
(38,577
|
)
|
||||
Prior periods
|
(428,325
|
)
|
|
(290,491)
|
|
|
(889,930
|
)
|
|
(641,137
|
)
|
||||
Total net paid losses
|
(473,966
|
)
|
|
(320,965)
|
|
|
(963,600
|
)
|
|
(679,714
|
)
|
||||
Effect of exchange rate movement
|
(31,672
|
)
|
|
(139,561
|
)
|
|
(11,993
|
)
|
|
(81,834
|
)
|
||||
Acquired on purchase of subsidiaries
|
686
|
|
|
343,806
|
|
|
686
|
|
|
343,806
|
|
||||
Assumed business
|
45,463
|
|
|
—
|
|
|
665,881
|
|
|
1,527,551
|
|
||||
Net balance as of June 30
|
7,674,794
|
|
|
6,670,025
|
|
|
7,674,794
|
|
|
6,670,025
|
|
||||
Plus: reinsurance reserves recoverable
|
2,059,998
|
|
|
1,866,969
|
|
|
2,059,998
|
|
|
1,866,969
|
|
||||
Plus: deferred charge assets on retroactive reinsurance
|
99,094
|
|
|
71,393
|
|
|
99,094
|
|
|
71,393
|
|
||||
Balance as of June 30
|
$
|
9,833,886
|
|
|
$
|
8,608,387
|
|
|
$
|
9,833,886
|
|
|
$
|
8,608,387
|
|
|
Three Months Ended June 30, 2019
|
||||||||||||||||||
|
Non-life Run-off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
Net losses paid
|
$
|
329,103
|
|
|
$
|
17,777
|
|
|
$
|
125,265
|
|
|
$
|
1,821
|
|
|
$
|
473,966
|
|
Net change in case and LAE reserves
|
(119,834
|
)
|
|
259
|
|
|
47,013
|
|
|
759
|
|
|
(71,803
|
)
|
|||||
Net change in IBNR reserves
|
(238,232
|
)
|
|
(4,801
|
)
|
|
15,345
|
|
|
1,885
|
|
|
(225,803
|
)
|
|||||
Increase (reduction) in estimates of net ultimate losses
|
(28,963
|
)
|
|
13,235
|
|
|
187,623
|
|
|
4,465
|
|
|
176,360
|
|
|||||
Increase (reduction) in provisions for unallocated LAE
|
(10,896
|
)
|
|
—
|
|
|
1,488
|
|
|
—
|
|
|
(9,408
|
)
|
|||||
Amortization of deferred charge assets
|
3,933
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,933
|
|
|||||
Amortization of fair value adjustments
|
7,716
|
|
|
(187
|
)
|
|
(38
|
)
|
|
—
|
|
|
7,491
|
|
|||||
Changes in fair value - fair value option
|
37,962
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
37,962
|
|
|||||
Net incurred losses and LAE
|
$
|
9,752
|
|
|
$
|
13,048
|
|
|
$
|
189,073
|
|
|
$
|
4,465
|
|
|
$
|
216,338
|
|
|
Three Months Ended June 30, 2018
|
||||||||||||||
|
Non-life
Run-off |
|
Atrium
|
|
StarStone
|
|
Total
|
||||||||
Net losses paid
|
$
|
196,311
|
|
|
$
|
19,347
|
|
|
$
|
105,307
|
|
|
$
|
320,965
|
|
Net change in case and LAE reserves
|
(124,364
|
)
|
|
(3,442
|
)
|
|
25,841
|
|
|
(101,965
|
)
|
||||
Net change in IBNR reserves
|
(157,639
|
)
|
|
1,855
|
|
|
12,742
|
|
|
(143,042
|
)
|
||||
Increase (reduction) in estimates of net ultimate losses
|
(85,692
|
)
|
|
17,760
|
|
|
143,890
|
|
|
75,958
|
|
||||
Increase (reduction) in provisions for unallocated LAE
|
(9,311
|
)
|
|
2
|
|
|
2,238
|
|
|
(7,071
|
)
|
||||
Amortization of deferred charge assets
|
3,718
|
|
|
—
|
|
|
—
|
|
|
3,718
|
|
||||
Amortization of fair value adjustments
|
3,918
|
|
|
(836
|
)
|
|
(101
|
)
|
|
2,981
|
|
||||
Changes in fair value - fair value option
|
17,233
|
|
|
—
|
|
|
—
|
|
|
17,233
|
|
||||
Net incurred losses and LAE
|
$
|
(70,134
|
)
|
|
$
|
16,926
|
|
|
$
|
146,027
|
|
|
$
|
92,819
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||
|
Non-life Run-off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
Net losses paid
|
$
|
678,172
|
|
|
$
|
40,090
|
|
|
$
|
240,682
|
|
|
$
|
4,656
|
|
|
$
|
963,600
|
|
Net change in case and LAE reserves
|
(197,535
|
)
|
|
(154
|
)
|
|
49,069
|
|
|
1,354
|
|
|
(147,266
|
)
|
|||||
Net change in IBNR reserves
|
(471,127
|
)
|
|
(10,618
|
)
|
|
91,769
|
|
|
3,411
|
|
|
(386,565
|
)
|
|||||
Increase (reduction) in estimates of net ultimate losses
|
9,510
|
|
|
29,318
|
|
|
381,520
|
|
|
9,421
|
|
|
429,769
|
|
|||||
Increase (reduction) in provisions for unallocated LAE
|
(26,071
|
)
|
|
—
|
|
|
2,836
|
|
|
—
|
|
|
(23,235
|
)
|
|||||
Amortization of deferred charge assets
|
10,997
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,997
|
|
|||||
Amortization of fair value adjustments
|
16,495
|
|
|
944
|
|
|
(231
|
)
|
|
—
|
|
|
17,208
|
|
|||||
Changes in fair value - fair value option
|
94,003
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
94,003
|
|
|||||
Net incurred losses and LAE
|
$
|
104,934
|
|
|
$
|
30,262
|
|
|
$
|
384,125
|
|
|
$
|
9,421
|
|
|
$
|
528,742
|
|
|
Six Months Ended June 30, 2018
|
||||||||||||||
|
Non-life
Run-off |
|
Atrium
|
|
StarStone
|
|
Total
|
||||||||
Net losses paid
|
$
|
448,895
|
|
|
$
|
36,877
|
|
|
$
|
193,942
|
|
|
$
|
679,714
|
|
Net change in case and LAE reserves
|
(247,850
|
)
|
|
448
|
|
|
21,366
|
|
|
(226,036
|
)
|
||||
Net change in IBNR reserves
|
(311,750
|
)
|
|
146
|
|
|
3,871
|
|
|
(307,733
|
)
|
||||
Increase (reduction) in estimates of net ultimate losses
|
(110,705
|
)
|
|
37,471
|
|
|
219,179
|
|
|
145,945
|
|
||||
Increase (reduction) in provisions for unallocated LAE
|
(24,263
|
)
|
|
2
|
|
|
2,430
|
|
|
(21,831
|
)
|
||||
Amortization of deferred charge assets
|
8,799
|
|
|
—
|
|
|
—
|
|
|
8,799
|
|
||||
Amortization of fair value adjustments
|
6,065
|
|
|
(3,375
|
)
|
|
(242
|
)
|
|
2,448
|
|
||||
Changes in fair value - fair value option
|
(23,008
|
)
|
|
—
|
|
|
—
|
|
|
(23,008
|
)
|
||||
Net incurred losses and LAE
|
$
|
(143,112
|
)
|
|
$
|
34,098
|
|
|
$
|
221,367
|
|
|
$
|
112,353
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|||||||||||
|
June 30,
|
|
June 30,
|
|||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|||||||
Balance as of beginning of period
|
$
|
8,154,974
|
|
|
$
|
7,517,511
|
|
|
7,540,662
|
|
|
$
|
5,949,472
|
|
Less: reinsurance reserves recoverable
|
1,579,646
|
|
|
1,703,481
|
|
|
1,366,123
|
|
|
1,377,485
|
|
|||
Less: deferred charge assets on retroactive insurance
|
100,154
|
|
|
75,111
|
|
|
86,585
|
|
|
80,192
|
|
|||
Net balance as of beginning of period
|
6,475,174
|
|
|
5,738,919
|
|
|
6,087,954
|
|
|
4,491,795
|
|
|||
Net incurred losses and LAE:
|
|
|
|
|
|
|
|
|||||||
Current period
|
34,375
|
|
|
5,113
|
|
|
83,446
|
|
|
5,459
|
|
|||
Prior periods
|
(24,623
|
)
|
|
(75,247
|
)
|
|
21,488
|
|
|
(148,571
|
)
|
|||
Total net incurred losses and LAE
|
9,752
|
|
|
(70,134
|
)
|
|
104,934
|
|
|
(143,112
|
)
|
|||
Net paid losses:
|
|
|
|
|
|
|
|
|||||||
Current period
|
(20,877
|
)
|
|
(590
|
)
|
|
(38,891
|
)
|
|
(591
|
)
|
|||
Prior periods
|
(308,226
|
)
|
|
(195,721
|
)
|
|
(639,281
|
)
|
|
(448,304
|
)
|
|||
Total net paid losses
|
(329,103
|
)
|
|
(196,311
|
)
|
|
(678,172
|
)
|
|
(448,895
|
)
|
|||
Effect of exchange rate movement
|
(31,830
|
)
|
|
(131,081
|
)
|
|
(11,141
|
)
|
|
(75,678
|
)
|
|||
Acquired on purchase of subsidiaries
|
686
|
|
|
150,825
|
|
|
686
|
|
|
150,825
|
|
|||
Assumed business
|
45,463
|
|
|
—
|
|
|
665,881
|
|
|
1,517,283
|
|
|||
Net balance as of June 30
|
6,170,142
|
|
|
5,492,218
|
|
|
6,170,142
|
|
|
5,492,218
|
|
|||
Plus: reinsurance reserves recoverable
|
1,534,427
|
|
|
1,462,139
|
|
|
1,534,427
|
|
|
1,462,139
|
|
|||
Plus: deferred charge assets on retroactive reinsurance
|
99,094
|
|
|
71,393
|
|
|
99,094
|
|
|
71,393
|
|
|||
Balance as of June 30
|
$
|
7,803,663
|
|
|
$
|
7,025,750
|
|
|
7,803,663
|
|
|
$
|
7,025,750
|
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior
Period
|
|
Current
Period
|
|
Total
|
|
Prior
Period
|
|
Current
Period
|
|
Total
|
||||||||||||
Net losses paid
|
$
|
308,226
|
|
|
$
|
20,877
|
|
|
$
|
329,103
|
|
|
$
|
195,721
|
|
|
$
|
590
|
|
|
$
|
196,311
|
|
Net change in case and LAE reserves
|
(121,377
|
)
|
|
1,543
|
|
|
(119,834
|
)
|
|
(125,416
|
)
|
|
1,052
|
|
|
(124,364
|
)
|
||||||
Net change in IBNR reserves
|
(249,923
|
)
|
|
11,691
|
|
|
(238,232
|
)
|
|
(161,110
|
)
|
|
3,471
|
|
|
(157,639
|
)
|
||||||
Increase (reduction) in estimates of net ultimate losses
|
(63,074
|
)
|
|
34,111
|
|
|
(28,963
|
)
|
|
(90,805
|
)
|
|
5,113
|
|
|
(85,692
|
)
|
||||||
Increase (reduction) in provisions for unallocated LAE
|
(11,160
|
)
|
|
264
|
|
|
(10,896
|
)
|
|
(9,311
|
)
|
|
—
|
|
|
(9,311
|
)
|
||||||
Amortization of deferred charge assets
|
3,933
|
|
|
—
|
|
|
3,933
|
|
|
3,718
|
|
|
—
|
|
|
3,718
|
|
||||||
Amortization of fair value adjustments
|
7,716
|
|
|
—
|
|
|
7,716
|
|
|
3,918
|
|
|
—
|
|
|
3,918
|
|
||||||
Changes in fair value - fair value option
|
37,962
|
|
|
—
|
|
|
37,962
|
|
|
17,233
|
|
|
—
|
|
|
17,233
|
|
||||||
Net incurred losses and LAE
|
$
|
(24,623
|
)
|
|
$
|
34,375
|
|
|
$
|
9,752
|
|
|
$
|
(75,247
|
)
|
|
$
|
5,113
|
|
|
$
|
(70,134
|
)
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior
Period
|
|
Current
Period
|
|
Total
|
|
Prior
Period
|
|
Current
Period
|
|
Total
|
||||||||||||
Net losses paid
|
$
|
639,281
|
|
|
$
|
38,891
|
|
|
$
|
678,172
|
|
|
$
|
448,304
|
|
|
$
|
591
|
|
|
$
|
448,895
|
|
Net change in case and LAE reserves
|
(218,950
|
)
|
|
21,415
|
|
|
(197,535
|
)
|
|
(248,908
|
)
|
|
1,058
|
|
|
(247,850
|
)
|
||||||
Net change in IBNR reserves
|
(493,738
|
)
|
|
22,611
|
|
|
(471,127
|
)
|
|
(315,560
|
)
|
|
3,810
|
|
|
(311,750
|
)
|
||||||
Increase (reduction) in estimates of net ultimate losses
|
(73,407
|
)
|
|
82,917
|
|
|
9,510
|
|
|
(116,164
|
)
|
|
5,459
|
|
|
(110,705
|
)
|
||||||
Increase (reduction) in provisions for unallocated LAE
|
(26,600
|
)
|
|
529
|
|
|
(26,071
|
)
|
|
(24,263
|
)
|
|
—
|
|
|
(24,263
|
)
|
||||||
Amortization of deferred charge assets
|
10,997
|
|
|
—
|
|
|
10,997
|
|
|
8,799
|
|
|
—
|
|
|
8,799
|
|
||||||
Amortization of fair value adjustments
|
16,495
|
|
|
—
|
|
|
16,495
|
|
|
6,065
|
|
|
—
|
|
|
6,065
|
|
||||||
Changes in fair value - fair value option
|
94,003
|
|
|
—
|
|
|
94,003
|
|
|
(23,008
|
)
|
|
—
|
|
|
(23,008
|
)
|
||||||
Net incurred losses and LAE
|
$
|
21,488
|
|
|
$
|
83,446
|
|
|
$
|
104,934
|
|
|
$
|
(148,571
|
)
|
|
$
|
5,459
|
|
|
$
|
(143,112
|
)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Balance as of beginning of period
|
$
|
229,380
|
|
|
$
|
240,795
|
|
|
$
|
241,284
|
|
|
$
|
240,873
|
|
Less: reinsurance reserves recoverable
|
31,682
|
|
|
40,025
|
|
|
38,768
|
|
|
40,531
|
|
||||
Net balance as of beginning of period
|
197,698
|
|
|
200,770
|
|
|
202,516
|
|
|
200,342
|
|
||||
Net incurred losses and LAE:
|
|
|
|
|
|
|
|
||||||||
Current period
|
17,859
|
|
|
19,175
|
|
|
36,096
|
|
|
36,481
|
|
||||
Prior periods
|
(4,811
|
)
|
|
(2,249
|
)
|
|
(5,834
|
)
|
|
(2,383
|
)
|
||||
Total net incurred losses and LAE
|
13,048
|
|
|
16,926
|
|
|
30,262
|
|
|
34,098
|
|
||||
Net paid losses:
|
|
|
|
|
|
|
|
||||||||
Current period
|
(7,251
|
)
|
|
(10,465
|
)
|
|
(15,144
|
)
|
|
(17,619
|
)
|
||||
Prior periods
|
(10,526
|
)
|
|
(8,882
|
)
|
|
(24,946
|
)
|
|
(19,258
|
)
|
||||
Total net paid losses
|
(17,777
|
)
|
|
(19,347
|
)
|
|
(40,090
|
)
|
|
(36,877
|
)
|
||||
Effect of exchange rate movement
|
1
|
|
|
(2,370
|
)
|
|
282
|
|
|
(1,584
|
)
|
||||
Net balance as of June 30
|
192,970
|
|
|
195,979
|
|
|
192,970
|
|
|
195,979
|
|
||||
Plus: reinsurance reserves recoverable
|
29,606
|
|
|
38,253
|
|
|
29,606
|
|
|
38,253
|
|
||||
Balance as of June 30
|
$
|
222,576
|
|
|
$
|
234,232
|
|
|
$
|
222,576
|
|
|
$
|
234,232
|
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior
Period
|
|
Current
Period
|
|
Total
|
|
Prior
Period
|
|
Current
Period
|
|
Total
|
||||||||||||
Net losses paid
|
$
|
10,526
|
|
|
$
|
7,251
|
|
|
$
|
17,777
|
|
|
$
|
8,882
|
|
|
$
|
10,465
|
|
|
$
|
19,347
|
|
Net change in case and LAE reserves
|
(3,830
|
)
|
|
4,089
|
|
|
259
|
|
|
(3,169
|
)
|
|
(273
|
)
|
|
(3,442
|
)
|
||||||
Net change in IBNR reserves
|
(11,320
|
)
|
|
6,519
|
|
|
(4,801
|
)
|
|
(7,128
|
)
|
|
8,983
|
|
|
1,855
|
|
||||||
Increase (reduction) in estimates of net ultimate losses
|
(4,624
|
)
|
|
17,859
|
|
|
13,235
|
|
|
(1,415
|
)
|
|
19,175
|
|
|
17,760
|
|
||||||
Increase in provisions for unallocated LAE
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||||
Amortization of fair value adjustments
|
(187
|
)
|
|
—
|
|
|
(187
|
)
|
|
(836
|
)
|
|
—
|
|
|
(836
|
)
|
||||||
Net incurred losses and LAE
|
$
|
(4,811
|
)
|
|
$
|
17,859
|
|
|
$
|
13,048
|
|
|
$
|
(2,249
|
)
|
|
$
|
19,175
|
|
|
$
|
16,926
|
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior Period
|
|
Current Period
|
|
Total
|
|
Prior Period
|
|
Current Period
|
|
Total
|
||||||||||||
Net losses paid
|
$
|
24,946
|
|
|
$
|
15,144
|
|
|
$
|
40,090
|
|
|
$
|
19,258
|
|
|
$
|
17,619
|
|
|
$
|
36,877
|
|
Net change in case and LAE reserves
|
(10,172
|
)
|
|
10,018
|
|
|
(154
|
)
|
|
(5,553
|
)
|
|
6,001
|
|
|
448
|
|
||||||
Net change in IBNR reserves
|
(21,552
|
)
|
|
10,934
|
|
|
(10,618
|
)
|
|
(12,715
|
)
|
|
12,861
|
|
|
146
|
|
||||||
Increase (reduction) in estimates of net ultimate losses
|
(6,778
|
)
|
|
36,096
|
|
|
29,318
|
|
|
990
|
|
|
36,481
|
|
|
37,471
|
|
||||||
Increase in provisions for unallocated LAE
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||||
Amortization of fair value adjustments
|
944
|
|
|
—
|
|
|
944
|
|
|
(3,375
|
)
|
|
—
|
|
|
(3,375
|
)
|
||||||
Net incurred losses and LAE
|
$
|
(5,834
|
)
|
|
$
|
36,096
|
|
|
$
|
30,262
|
|
|
$
|
(2,383
|
)
|
|
$
|
36,481
|
|
|
$
|
34,098
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Balance as of beginning of period
|
$
|
1,690,686
|
|
|
$
|
1,227,764
|
|
|
$
|
1,608,697
|
|
|
$
|
1,207,743
|
|
Less: reinsurance reserves recoverable
|
466,595
|
|
|
473,527
|
|
|
462,950
|
|
|
452,017
|
|
||||
Net balance as of beginning of period
|
1,224,091
|
|
|
754,237
|
|
|
1,145,747
|
|
|
755,726
|
|
||||
Net incurred losses and LAE:
|
|
|
|
|
|
|
|
||||||||
Current period
|
146,349
|
|
|
129,572
|
|
|
291,299
|
|
|
207,074
|
|
||||
Prior periods
|
42,724
|
|
|
16,455
|
|
|
92,826
|
|
|
14,293
|
|
||||
Total net incurred losses and LAE
|
189,073
|
|
|
146,027
|
|
|
384,125
|
|
|
221,367
|
|
||||
Net paid losses:
|
|
|
|
|
|
|
|
||||||||
Current period
|
(16,903
|
)
|
|
(19,419
|
)
|
|
(18,695
|
)
|
|
(20,367
|
)
|
||||
Prior periods
|
(108,362
|
)
|
|
(85,888
|
)
|
|
(221,987
|
)
|
|
(173,575
|
)
|
||||
Total net paid losses
|
(125,265
|
)
|
|
(105,307
|
)
|
|
(240,682
|
)
|
|
(193,942
|
)
|
||||
Effect of exchange rate movement
|
157
|
|
|
(6,110
|
)
|
|
(1,134
|
)
|
|
(4,572
|
)
|
||||
Acquired on purchase of subsidiaries
|
—
|
|
|
192,981
|
|
|
—
|
|
|
192,981
|
|
||||
Assumed business
|
—
|
|
|
—
|
|
|
—
|
|
|
10,268
|
|
||||
Net balance as of June 30
|
1,288,056
|
|
|
981,828
|
|
|
1,288,056
|
|
|
981,828
|
|
||||
Plus: reinsurance reserves recoverable
|
495,965
|
|
|
366,577
|
|
|
495,965
|
|
|
366,577
|
|
||||
Balance as of June 30
|
$
|
1,784,021
|
|
|
$
|
1,348,405
|
|
|
$
|
1,784,021
|
|
|
$
|
1,348,405
|
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior Period
|
|
Current Period
|
|
Total
|
|
Prior Period
|
|
Current Period
|
|
Total
|
||||||||||||
Net losses paid
|
$
|
108,362
|
|
|
$
|
16,903
|
|
|
$
|
125,265
|
|
|
$
|
85,888
|
|
|
$
|
19,419
|
|
|
$
|
105,307
|
|
Net change in case and LAE reserves
|
3,574
|
|
|
43,439
|
|
|
47,013
|
|
|
(21,405
|
)
|
|
47,246
|
|
|
25,841
|
|
||||||
Net change in IBNR reserves
|
(68,571
|
)
|
|
83,916
|
|
|
15,345
|
|
|
(46,738
|
)
|
|
59,480
|
|
|
12,742
|
|
||||||
Increase in estimates of net ultimate losses
|
43,365
|
|
|
144,258
|
|
|
187,623
|
|
|
17,745
|
|
|
126,145
|
|
|
143,890
|
|
||||||
Increase (reduction) in provisions for unallocated LAE
|
(603
|
)
|
|
2,091
|
|
|
1,488
|
|
|
(1,189
|
)
|
|
3,427
|
|
|
2,238
|
|
||||||
Amortization of fair value adjustments
|
(38
|
)
|
|
—
|
|
|
(38
|
)
|
|
(101
|
)
|
|
—
|
|
|
(101
|
)
|
||||||
Net incurred losses and LAE
|
$
|
42,724
|
|
|
$
|
146,349
|
|
|
$
|
189,073
|
|
|
$
|
16,455
|
|
|
$
|
129,572
|
|
|
$
|
146,027
|
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior Period
|
|
Current Period
|
|
Total
|
|
Prior Period
|
|
Current Period
|
|
Total
|
||||||||||||
Net losses paid
|
$
|
221,987
|
|
|
$
|
18,695
|
|
|
$
|
240,682
|
|
|
$
|
173,575
|
|
|
$
|
20,367
|
|
|
$
|
193,942
|
|
Net change in case and LAE reserves
|
(5,250
|
)
|
|
54,319
|
|
|
49,069
|
|
|
(35,622
|
)
|
|
56,988
|
|
|
21,366
|
|
||||||
Net change in IBNR reserves
|
(121,405
|
)
|
|
213,174
|
|
|
91,769
|
|
|
(120,128
|
)
|
|
123,999
|
|
|
3,871
|
|
||||||
Increase in estimates of net ultimate losses
|
95,332
|
|
|
286,188
|
|
|
381,520
|
|
|
17,825
|
|
|
201,354
|
|
|
219,179
|
|
||||||
Increase (reduction) in provisions for unallocated LAE
|
(2,275
|
)
|
|
5,111
|
|
|
2,836
|
|
|
(3,290
|
)
|
|
5,720
|
|
|
2,430
|
|
||||||
Amortization of fair value adjustments
|
(231
|
)
|
|
—
|
|
|
(231
|
)
|
|
(242
|
)
|
|
—
|
|
|
(242
|
)
|
||||||
Net incurred losses and LAE
|
$
|
92,826
|
|
|
$
|
291,299
|
|
|
$
|
384,125
|
|
|
$
|
14,293
|
|
|
$
|
207,074
|
|
|
$
|
221,367
|
|
•
|
Level 1 - Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access. Valuation adjustments and block discounts are not applied to Level 1 instruments.
|
•
|
Level 2 - Valuations based on quoted prices in active markets for similar assets or liabilities, quoted prices for identical assets or liabilities in inactive markets, or for which significant inputs are observable (e.g. interest rates, yield curves, prepayment speeds, default rates, loss severities, etc.) or can be corroborated by observable market data.
|
•
|
Level 3 - Valuations based on unobservable inputs where there is little or no market activity. Unadjusted third party pricing sources or management's assumptions and internal valuation models may be used to determine the fair values.
|
|
|
June 30, 2019
|
||||||||||||||||||
|
|
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Fair Value Based on NAV as Practical Expedient
|
|
Total Fair
Value |
||||||||||
Investments:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturity investments:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. government and agency
|
|
$
|
—
|
|
|
$
|
511,543
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
511,543
|
|
U.K. government
|
|
—
|
|
|
349,808
|
|
|
—
|
|
|
—
|
|
|
349,808
|
|
|||||
Other government
|
|
—
|
|
|
698,752
|
|
|
—
|
|
|
—
|
|
|
698,752
|
|
|||||
Corporate
|
|
—
|
|
|
5,135,855
|
|
|
5,006
|
|
|
—
|
|
|
5,140,861
|
|
|||||
Municipal
|
|
—
|
|
|
161,429
|
|
|
—
|
|
|
—
|
|
|
161,429
|
|
|||||
Residential mortgage-backed
|
|
—
|
|
|
416,205
|
|
|
102
|
|
|
—
|
|
|
416,307
|
|
|||||
Commercial mortgage-backed
|
|
—
|
|
|
939,046
|
|
|
1,370
|
|
|
—
|
|
|
940,416
|
|
|||||
Asset-backed
|
|
—
|
|
|
707,514
|
|
|
25,839
|
|
|
—
|
|
|
733,353
|
|
|||||
|
|
$
|
—
|
|
|
$
|
8,920,152
|
|
|
$
|
32,317
|
|
|
$
|
—
|
|
|
$
|
8,952,469
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other assets included within funds held - directly managed
|
|
17,826
|
|
|
6,945
|
|
|
—
|
|
|
—
|
|
|
24,771
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Equities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Publicly traded equity investments
|
|
$
|
175,221
|
|
|
$
|
31,364
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
206,585
|
|
Exchange-traded fund
|
|
86,059
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
86,059
|
|
|||||
Privately held equity investments
|
|
—
|
|
|
—
|
|
|
229,394
|
|
|
—
|
|
|
229,394
|
|
|||||
|
|
$
|
261,280
|
|
|
$
|
31,364
|
|
|
$
|
229,394
|
|
|
$
|
—
|
|
|
$
|
522,038
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other investments:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Hedge funds
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,006,221
|
|
|
$
|
1,006,221
|
|
Fixed income funds
|
|
—
|
|
|
473,519
|
|
|
—
|
|
|
124,496
|
|
|
598,015
|
|
|||||
Equity funds
|
|
—
|
|
|
104,379
|
|
|
—
|
|
|
274,445
|
|
|
378,824
|
|
|||||
Private equity funds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
244,950
|
|
|
244,950
|
|
|||||
CLO equities
|
|
—
|
|
|
—
|
|
|
50,138
|
|
|
—
|
|
|
50,138
|
|
|||||
CLO equity fund
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66,311
|
|
|
66,311
|
|
|||||
Private credit funds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
56,827
|
|
|
56,827
|
|
|||||
Others
|
|
—
|
|
|
1,904
|
|
|
314
|
|
|
16,008
|
|
|
18,226
|
|
|||||
|
|
$
|
—
|
|
|
$
|
579,802
|
|
|
$
|
50,452
|
|
|
$
|
1,789,258
|
|
|
$
|
2,419,512
|
|
Total Investments
|
|
$
|
279,106
|
|
|
$
|
9,538,263
|
|
|
$
|
312,163
|
|
|
$
|
1,789,258
|
|
|
$
|
11,918,790
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
161,128
|
|
|
$
|
124,137
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
285,265
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reinsurance balances recoverable on paid and unpaid losses:
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
743,304
|
|
|
$
|
—
|
|
|
$
|
743,304
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivative Instruments
|
|
$
|
—
|
|
|
$
|
2,089
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,089
|
|
|
|
$
|
—
|
|
|
$
|
2,089
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,089
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Losses and LAE:
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,772,501
|
|
|
$
|
—
|
|
|
$
|
2,772,501
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivative Instruments
|
|
$
|
—
|
|
|
$
|
9,396
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9,396
|
|
|
|
$
|
—
|
|
|
$
|
9,396
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9,396
|
|
|
|
December 31, 2018
|
||||||||||||||||||
|
|
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Fair Value Based on NAV as Practical Expedient
|
|
Total Fair
Value |
||||||||||
Investments:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturity investments:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. government and agency
|
|
$
|
—
|
|
|
$
|
510,245
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
510,245
|
|
U.K government
|
|
—
|
|
|
300,631
|
|
|
—
|
|
|
—
|
|
|
300,631
|
|
|||||
Other government
|
|
—
|
|
|
793,810
|
|
|
—
|
|
|
—
|
|
|
793,810
|
|
|||||
Corporate
|
|
—
|
|
|
4,802,454
|
|
|
37,386
|
|
|
—
|
|
|
4,839,840
|
|
|||||
Municipal
|
|
—
|
|
|
130,265
|
|
|
—
|
|
|
—
|
|
|
130,265
|
|
|||||
Residential mortgage-backed
|
|
—
|
|
|
773,557
|
|
|
—
|
|
|
—
|
|
|
773,557
|
|
|||||
Commercial mortgage-backed
|
|
—
|
|
|
705,674
|
|
|
7,389
|
|
|
—
|
|
|
713,063
|
|
|||||
Asset-backed
|
|
—
|
|
|
627,360
|
|
|
9,121
|
|
|
—
|
|
|
636,481
|
|
|||||
|
|
$
|
—
|
|
|
$
|
8,643,996
|
|
|
$
|
53,896
|
|
|
$
|
—
|
|
|
$
|
8,697,892
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other assets included within funds held - directly managed
|
|
$
|
—
|
|
|
$
|
14,780
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,780
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Equities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Publicly traded equity investments
|
|
$
|
102,102
|
|
|
$
|
36,313
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
138,415
|
|
Privately held equity investments
|
|
—
|
|
|
—
|
|
|
228,710
|
|
|
—
|
|
|
228,710
|
|
|||||
|
|
$
|
102,102
|
|
|
$
|
36,313
|
|
|
$
|
228,710
|
|
|
$
|
—
|
|
|
$
|
367,125
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other investments:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Hedge funds
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
852,584
|
|
|
$
|
852,584
|
|
Fixed income funds
|
|
—
|
|
|
290,864
|
|
|
—
|
|
|
112,994
|
|
|
403,858
|
|
|||||
Equity funds
|
|
—
|
|
|
100,440
|
|
|
—
|
|
|
233,241
|
|
|
333,681
|
|
|||||
Private equity funds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
248,628
|
|
|
248,628
|
|
|||||
CLO equities
|
|
—
|
|
|
—
|
|
|
39,052
|
|
|
—
|
|
|
39,052
|
|
|||||
CLO equity funds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
37,260
|
|
|
37,260
|
|
|||||
Private credit funds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,381
|
|
|
33,381
|
|
|||||
Other
|
|
—
|
|
|
578
|
|
|
315
|
|
|
8,420
|
|
|
9,313
|
|
|||||
|
|
$
|
—
|
|
|
$
|
391,882
|
|
|
$
|
39,367
|
|
|
$
|
1,526,508
|
|
|
$
|
1,957,757
|
|
Total Investments
|
|
$
|
102,102
|
|
|
$
|
9,086,971
|
|
|
$
|
321,973
|
|
|
$
|
1,526,508
|
|
|
$
|
11,037,554
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
243,839
|
|
|
$
|
21,146
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
264,985
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reinsurance recoverable:
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
739,591
|
|
|
$
|
—
|
|
|
$
|
739,591
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivative Instruments
|
|
$
|
—
|
|
|
$
|
6,701
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,701
|
|
|
|
$
|
—
|
|
|
$
|
6,701
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,701
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Losses and LAE:
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,874,055
|
|
|
$
|
—
|
|
|
$
|
2,874,055
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivative Instruments
|
|
$
|
—
|
|
|
$
|
983
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
983
|
|
|
|
$
|
—
|
|
|
$
|
983
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
983
|
|
•
|
U.S. government and agency securities consist of securities issued by the U.S. Treasury and mortgage pass-through agencies such as the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation and other agencies. Non-U.S. government securities consist of bonds issued by non-U.S. governments and agencies along with supranational organizations. The significant inputs used to determine the fair value of these securities include the spread above the risk-free yield curve, reported trades and broker-dealer quotes. These are considered to be observable market inputs and, therefore, the fair values of these securities are classified as Level 2.
|
•
|
Corporate securities consist primarily of investment-grade debt of a wide variety of corporate issuers and industries. The fair values of these securities are determined using the spread above the risk-free yield curve, reported trades, broker-dealer quotes, benchmark yields, and industry and market indicators. These are considered observable market inputs and, therefore, the fair values of these securities are classified as Level 2. Where pricing is unavailable from pricing services, such as in periods of low trading activity or when transactions are not orderly, we obtain non-binding quotes from broker-dealers. Where significant inputs are unable to be corroborated with market observable information, we classify the securities as Level 3.
|
•
|
Municipal securities consist primarily of bonds issued by U.S.-domiciled state and municipal entities. The fair values of these securities are determined using the spread above the risk-free yield curve, reported trades, broker-dealer quotes and benchmark yields. These are considered observable market inputs and, therefore, the fair values of these securities are classified as Level 2.
|
•
|
Asset-backed securities consist primarily of investment-grade bonds backed by pools of loans with a variety of underlying collateral. Residential and commercial mortgage-backed securities include both agency and non-agency originated securities. Where pricing is unavailable from pricing services, we obtain non-binding quotes from broker-dealers. This is generally the case when there is a low volume of trading activity and current transactions are not orderly. The significant inputs used to determine the fair value of these securities include the spread above the risk-free yield curve, reported trades, benchmark yields, prepayment speeds and default rates. The fair values of these securities are classified as Level 2 if the significant inputs are market observable. Where significant inputs are unable to be corroborated with market observable
|
•
|
For our investments in hedge funds, we measure fair value by obtaining the most recently available NAV as advised by the external fund manager or third-party administrator. The fair values of these investments are measured using the NAV as a practical expedient and therefore have not been categorized within the fair value hierarchy.
|
•
|
Our investments in fixed income funds and equity funds are valued based on a combination of prices from independent pricing services, external fund managers or third-party administrators. For the publicly available prices we have classified the investments as Level 2. For the non-publicly available prices we are using NAV as a practical expedient and therefore these have not been categorized within the fair value hierarchy.
|
•
|
For our investments in private equity funds, we measure fair value by obtaining the most recently available NAV from the external fund manager or third-party administrator. The fair values of these investments are measured using the NAV as a practical expedient and therefore have not been categorized within the fair value hierarchy.
|
•
|
We measure the fair value of our direct investment in CLO equities based on valuations provided by our external CLO equity manager. If the investment does not involve an external CLO equity manager, the fair value of the investment is based on valuations provided by the broker or lead underwriter of the investment (the "broker"). Our CLO equity investments have been classified as Level 3 due to the use of unobservable inputs in the valuation and the limited number of relevant trades in secondary markets.
|
•
|
For our investments in the CLO equity fund, we measure fair value by obtaining the most recently available NAV as advised by the external fund manager or third party administrator. The fair value of this investment is measured using the NAV as a practical expedient and therefore have not been categorized within the fair value hierarchy.
|
•
|
For our investments in private credit funds, we measure fair value by obtaining the most recently available NAV from the external fund manager or third-party administrator. The fair values of these investments are measured using the NAV as a practical expedient and therefore have not been categorized within the fair value hierarchy.
|
•
|
Included within other are investments in real estate debt funds, for which we measure fair value by obtaining the most recently available NAV from the external fund manager or third-party administrator. The fair value of these investments are measured using the NAV as a practical expedient and therefore have not been categorized within the fair value hierarchy.
|
|
|
Three Months Ended June 30, 2019
|
||||||||||||||||||||||||||
|
|
Fixed maturity investments
|
|
Privately-held Equities
|
|
Other Investments
|
|
Total
|
||||||||||||||||||||
|
|
Corporate
|
|
Residential mortgage-backed
|
|
Commercial mortgage-backed
|
|
Asset-backed
|
|
|
|
|||||||||||||||||
Beginning fair value
|
|
$
|
3,172
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9,300
|
|
|
$
|
228,710
|
|
|
$
|
41,747
|
|
|
$
|
282,929
|
|
Purchases
|
|
90
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,995
|
|
|
12,085
|
|
|||||||
Sales
|
|
(381
|
)
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
—
|
|
|
(390
|
)
|
|||||||
Total realized and unrealized gains (losses)
|
|
(40
|
)
|
|
—
|
|
|
(145
|
)
|
|
2
|
|
|
684
|
|
|
(3,290
|
)
|
|
(2,789
|
)
|
|||||||
Transfer into Level 3 from Level 2
|
|
2,871
|
|
|
102
|
|
|
1,515
|
|
|
16,546
|
|
|
—
|
|
|
—
|
|
|
21,034
|
|
|||||||
Transfer out of Level 3 into Level 2
|
|
(706
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(706
|
)
|
|||||||
Ending fair value
|
|
$
|
5,006
|
|
|
$
|
102
|
|
|
$
|
1,370
|
|
|
$
|
25,839
|
|
|
$
|
229,394
|
|
|
$
|
50,452
|
|
|
$
|
312,163
|
|
|
|
Three Months Ended June 30, 2018
|
||||||||||||||||||||||||||
|
|
Fixed maturity investments
|
|
Privately-held Equities
|
|
Other Investments
|
|
Total
|
||||||||||||||||||||
|
|
Corporate
|
|
Residential mortgage-backed
|
|
Commercial mortgage-backed
|
|
Asset-backed
|
|
|
|
|||||||||||||||||
Beginning fair value
|
|
$
|
86,027
|
|
|
$
|
1,907
|
|
|
$
|
17,634
|
|
|
$
|
21,997
|
|
|
$
|
—
|
|
|
$
|
56,659
|
|
|
$
|
184,224
|
|
Purchases
|
|
971
|
|
|
—
|
|
|
—
|
|
|
28,291
|
|
|
2,000
|
|
|
622
|
|
|
31,884
|
|
|||||||
Sales
|
|
(53,873
|
)
|
|
(36
|
)
|
|
(1,150
|
)
|
|
(8
|
)
|
|
—
|
|
|
(600
|
)
|
|
(55,667
|
)
|
|||||||
Total realized and unrealized gains (losses)
|
|
(258
|
)
|
|
(8
|
)
|
|
(31
|
)
|
|
(117
|
)
|
|
16
|
|
|
(2,527
|
)
|
|
(2,925
|
)
|
|||||||
Transfer into Level 3 from Level 2
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,079
|
|
|
—
|
|
|
—
|
|
|
2,079
|
|
|||||||
Transfer out of Level 3 into Level 2
|
|
(5,044
|
)
|
|
(1,863
|
)
|
|
(1,127
|
)
|
|
(5,634
|
)
|
|
—
|
|
|
—
|
|
|
(13,668
|
)
|
|||||||
Ending fair value
|
|
$
|
27,823
|
|
|
$
|
—
|
|
|
$
|
15,326
|
|
|
$
|
46,608
|
|
|
$
|
2,016
|
|
|
$
|
54,154
|
|
|
$
|
145,927
|
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||||||||||
|
|
Fixed maturity investments
|
|
Privately-held Equities
|
|
Other Investments
|
|
Total
|
||||||||||||||||||||
|
|
Corporate
|
|
Residential mortgage-backed
|
|
Commercial mortgage-backed
|
|
Asset-backed
|
|
|
|
|||||||||||||||||
Beginning fair value
|
|
$
|
37,386
|
|
|
$
|
—
|
|
|
$
|
7,389
|
|
|
$
|
9,121
|
|
|
$
|
228,710
|
|
|
$
|
39,367
|
|
|
$
|
321,973
|
|
Purchases
|
|
90
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,995
|
|
|
12,085
|
|
|||||||
Sales
|
|
(3,041
|
)
|
|
—
|
|
|
(608
|
)
|
|
(330
|
)
|
|
—
|
|
|
—
|
|
|
(3,979
|
)
|
|||||||
Total realized and unrealized gains (losses)
|
|
217
|
|
|
—
|
|
|
(83
|
)
|
|
739
|
|
|
684
|
|
|
(910
|
)
|
|
647
|
|
|||||||
Transfer into Level 3 from Level 2
|
|
3,258
|
|
|
102
|
|
|
1,515
|
|
|
22,771
|
|
|
—
|
|
|
—
|
|
|
27,646
|
|
|||||||
Transfer out of Level 3 into Level 2
|
|
(32,904
|
)
|
|
—
|
|
|
(6,843
|
)
|
|
(6,462
|
)
|
|
—
|
|
|
—
|
|
|
(46,209
|
)
|
|||||||
Ending fair value
|
|
$
|
5,006
|
|
|
$
|
102
|
|
|
$
|
1,370
|
|
|
$
|
25,839
|
|
|
$
|
229,394
|
|
|
$
|
50,452
|
|
|
$
|
312,163
|
|
|
|
Six Months Ended June 30, 2018
|
||||||||||||||||||||||||||
|
|
Fixed maturity investments
|
|
Privately-held Equities
|
|
Other Investments
|
|
Total
|
||||||||||||||||||||
|
|
Corporate
|
|
Residential mortgage-backed
|
|
Commercial mortgage-backed
|
|
Asset-backed
|
|
|
|
|||||||||||||||||
Beginning fair value
|
|
$
|
67,178
|
|
|
$
|
3,080
|
|
|
$
|
21,494
|
|
|
$
|
27,892
|
|
|
$
|
—
|
|
|
$
|
57,079
|
|
|
$
|
176,723
|
|
Purchases
|
|
11,803
|
|
|
—
|
|
|
1,803
|
|
|
29,591
|
|
|
2,000
|
|
|
752
|
|
|
45,949
|
|
|||||||
Sales
|
|
(60,910
|
)
|
|
(1,184
|
)
|
|
(1,727
|
)
|
|
(3,812
|
)
|
|
—
|
|
|
(600
|
)
|
|
(68,233
|
)
|
|||||||
Total realized and unrealized gains (losses)
|
|
(63
|
)
|
|
(33
|
)
|
|
52
|
|
|
(71
|
)
|
|
16
|
|
|
(3,077
|
)
|
|
(3,176
|
)
|
|||||||
Transfer into Level 3 from Level 2
|
|
15,259
|
|
|
—
|
|
|
4,897
|
|
|
2,079
|
|
|
—
|
|
|
—
|
|
|
22,235
|
|
|||||||
Transfer out of Level 3 into Level 2
|
|
(5,444
|
)
|
|
(1,863
|
)
|
|
(11,193
|
)
|
|
(9,071
|
)
|
|
—
|
|
|
—
|
|
|
(27,571
|
)
|
|||||||
Ending fair value
|
|
$
|
27,823
|
|
|
$
|
—
|
|
|
$
|
15,326
|
|
|
$
|
46,608
|
|
|
$
|
2,016
|
|
|
$
|
54,154
|
|
|
$
|
145,927
|
|
|
Three Months Ended
|
||||||||||||||||||||||
|
June 30, 2019
|
|
June 30, 2018
|
||||||||||||||||||||
|
Liability for losses and LAE
|
|
Reinsurance balances recoverable
|
|
Net
|
|
Liability for losses and LAE
|
|
Reinsurance balances recoverable
|
|
Net
|
||||||||||||
Beginning fair value
|
$
|
2,847,793
|
|
|
$
|
735,257
|
|
|
$
|
2,112,536
|
|
|
$
|
3,519,453
|
|
|
$
|
888,736
|
|
|
$
|
2,630,717
|
|
Incurred losses and LAE:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Reduction in estimates of ultimate losses
|
(5,802
|
)
|
|
5,191
|
|
|
(10,993
|
)
|
|
(42,471
|
)
|
|
3,860
|
|
|
(46,331
|
)
|
||||||
Reduction in unallocated LAE
|
(4,011
|
)
|
|
—
|
|
|
(4,011
|
)
|
|
(5,534
|
)
|
|
—
|
|
|
(5,534
|
)
|
||||||
Change in fair value
|
54,218
|
|
|
16,256
|
|
|
37,962
|
|
|
17,546
|
|
|
313
|
|
|
17,233
|
|
||||||
Total incurred losses and LAE
|
44,405
|
|
|
21,447
|
|
|
22,958
|
|
|
(30,459
|
)
|
|
4,173
|
|
|
(34,632
|
)
|
||||||
Paid losses
|
(91,753
|
)
|
|
(9,081
|
)
|
|
(82,672
|
)
|
|
(145,676
|
)
|
|
(35,389
|
)
|
|
(110,287
|
)
|
||||||
Effect of exchange rate movements
|
(27,944
|
)
|
|
(4,319
|
)
|
|
(23,625
|
)
|
|
(121,952
|
)
|
|
(20,147
|
)
|
|
(101,805
|
)
|
||||||
Ending fair value
|
$
|
2,772,501
|
|
|
$
|
743,304
|
|
|
$
|
2,029,197
|
|
|
$
|
3,221,366
|
|
|
$
|
837,373
|
|
|
$
|
2,383,993
|
|
|
|
Three Months Ended
|
||||||
|
|
June 30, 2019
|
|
June 30, 2018
|
||||
Changes in fair value due to changes in:
|
|
|
|
|
||||
Duration
|
|
$
|
5,839
|
|
|
$
|
16,279
|
|
Corporate bond yield
|
|
32,123
|
|
|
(2,729
|
)
|
||
Risk cost of capital
|
|
—
|
|
|
3,683
|
|
||
Change in fair value
|
|
$
|
37,962
|
|
|
$
|
17,233
|
|
|
Six Months Ended
|
||||||||||||||||||||||
|
June 30, 2019
|
|
June 30, 2018
|
||||||||||||||||||||
|
Liability for losses and LAE
|
|
Reinsurance balances recoverable on paid and unpaid losses
|
|
Net
|
|
Liability for losses and LAE
|
|
Reinsurance balances recoverable on paid and unpaid losses
|
|
Net
|
||||||||||||
Beginning fair value
|
$
|
2,874,055
|
|
|
$
|
739,591
|
|
|
$
|
2,134,464
|
|
|
$
|
1,794,669
|
|
|
$
|
542,224
|
|
|
$
|
1,252,445
|
|
Assumed business
|
—
|
|
|
—
|
|
|
—
|
|
|
1,890,061
|
|
|
372,780
|
|
|
1,517,281
|
|
||||||
Incurred losses and LAE:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Reduction in estimates of ultimate losses
|
(12,956
|
)
|
|
1,705
|
|
|
(14,661
|
)
|
|
(43,780
|
)
|
|
2,384
|
|
|
(46,164
|
)
|
||||||
Reduction in unallocated LAE
|
(8,352
|
)
|
|
—
|
|
|
(8,352
|
)
|
|
(11,416
|
)
|
|
—
|
|
|
(11,416
|
)
|
||||||
Change in fair value
|
131,679
|
|
|
37,676
|
|
|
94,003
|
|
|
(39,609
|
)
|
|
(16,601
|
)
|
|
(23,008
|
)
|
||||||
Total incurred losses and LAE
|
110,371
|
|
|
39,381
|
|
|
70,990
|
|
|
(94,805
|
)
|
|
(14,217
|
)
|
|
(80,588
|
)
|
||||||
Paid losses
|
(207,613
|
)
|
|
(36,323
|
)
|
|
(171,290
|
)
|
|
(304,048
|
)
|
|
(53,535
|
)
|
|
(250,513
|
)
|
||||||
Effect of exchange rate movements
|
(4,312
|
)
|
|
655
|
|
|
(4,967
|
)
|
|
(64,511
|
)
|
|
(9,879
|
)
|
|
(54,632
|
)
|
||||||
Ending fair value
|
$
|
2,772,501
|
|
|
$
|
743,304
|
|
|
$
|
2,029,197
|
|
|
$
|
3,221,366
|
|
|
$
|
837,373
|
|
|
$
|
2,383,993
|
|
|
|
Six Months Ended
|
||||||
|
|
June 30, 2019
|
|
June 30, 2018
|
||||
Changes in fair value due to changes in:
|
|
|
|
|
||||
Duration
|
|
$
|
14,886
|
|
|
$
|
21,819
|
|
Corporate bond yield
|
|
79,117
|
|
|
(48,510
|
)
|
||
Risk cost of capital
|
|
—
|
|
|
3,683
|
|
||
Change in fair value
|
|
$
|
94,003
|
|
|
$
|
(23,008
|
)
|
|
|
|
|
June 30, 2019
|
|
December 31, 2018
|
Valuation Technique
|
|
Unobservable (U) and Observable (O) Inputs
|
|
Weighted Average
|
||
Internal model
|
|
Corporate bond yield (O)
|
|
A rated
|
|
A rated
|
Internal model
|
|
Credit spread for non-performance risk (U)
|
|
0.2%
|
|
0.2%
|
Internal model
|
|
Risk cost of capital (U)
|
|
5.1%
|
|
5.0%
|
Internal model
|
|
Weighted average cost of capital (U)
|
|
8.5%
|
|
8.5%
|
Internal model
|
|
Duration - liability (U)
|
|
7.44 years
|
|
7.33 years
|
Internal model
|
|
Duration - reinsurance balances recoverable (U)
|
|
7.92 years
|
|
7.98 years
|
•
|
An increase in the corporate bond rate or credit spread for non-performance risk would result in a decrease in the fair value of the liability for losses and LAE and reinsurance balances recoverable on paid and unpaid losses. Conversely, a decrease in the corporate bond rate or credit spread for non-performance risk would result in an increase in the fair value of the liability for losses and LAE and reinsurance balances recoverable on paid and unpaid losses.
|
•
|
An increase in the weighted average cost of capital would result in an increase in the fair value of the liability for losses and LAE and reinsurance balances recoverable on paid and unpaid losses. Conversely, a decrease in the weighted average cost of capital would result in a decrease in the fair value of the liability for losses and LAE and reinsurance balances recoverable on paid and unpaid losses.
|
•
|
An increase in the risk cost of capital would result in an increase in the fair value of the liability for losses and LAE and reinsurance balances recoverable on paid and unpaid losses. Conversely, a decrease in the risk cost of capital would result in a decrease in the fair value of the liability for losses and LAE and reinsurance balances recoverable on paid and unpaid losses.
|
•
|
The duration of the liability and recoverable is adjusted every period to reflect actual net payments during the period and expected future payments. An acceleration of the estimated payment pattern, a decrease in duration, would result in an increase in the fair value of the liability for losses and LAE and reinsurance balances recoverable on paid and unpaid losses. Conversely, a deceleration of the estimated payment pattern, an increase in duration, would result in a decrease in the fair value of the liability for losses and LAE and reinsurance balances recoverable on paid and unpaid losses.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||||||
|
Premiums
Written
|
|
Premiums
Earned
|
|
Premiums
Written
|
|
Premiums
Earned
|
|
Premiums
Written
|
|
Premiums
Earned
|
|
Premiums
Written
|
|
Premiums
Earned
|
||||||||||||||||
Non-life Run-off
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Gross
|
$
|
(4,209
|
)
|
|
$
|
55,551
|
|
|
$
|
(938
|
)
|
|
$
|
23,188
|
|
|
$
|
(25,086
|
)
|
|
$
|
139,517
|
|
|
$
|
6,442
|
|
|
$
|
36,298
|
|
Ceded
|
800
|
|
|
(7,081
|
)
|
|
(723
|
)
|
|
(13,579
|
)
|
|
2,499
|
|
|
(14,373
|
)
|
|
(8,003
|
)
|
|
(19,511
|
)
|
||||||||
Net
|
$
|
(3,409
|
)
|
|
$
|
48,470
|
|
|
$
|
(1,661
|
)
|
|
$
|
9,609
|
|
|
$
|
(22,587
|
)
|
|
$
|
125,144
|
|
|
$
|
(1,561
|
)
|
|
$
|
16,787
|
|
Atrium
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Gross
|
$
|
43,788
|
|
|
$
|
41,884
|
|
|
$
|
41,560
|
|
|
$
|
39,795
|
|
|
$
|
97,773
|
|
|
$
|
85,270
|
|
|
$
|
91,002
|
|
|
$
|
79,469
|
|
Ceded
|
(6,826
|
)
|
|
(3,685
|
)
|
|
(6,977
|
)
|
|
(5,273
|
)
|
|
(14,312
|
)
|
|
(8,318
|
)
|
|
(14,925
|
)
|
|
(9,724
|
)
|
||||||||
Net
|
$
|
36,962
|
|
|
$
|
38,199
|
|
|
$
|
34,583
|
|
|
$
|
34,522
|
|
|
$
|
83,461
|
|
|
$
|
76,952
|
|
|
$
|
76,077
|
|
|
$
|
69,745
|
|
StarStone
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Gross
|
$
|
234,104
|
|
|
$
|
232,877
|
|
|
$
|
301,353
|
|
|
$
|
245,284
|
|
|
$
|
485,477
|
|
|
$
|
501,141
|
|
|
$
|
606,342
|
|
|
$
|
480,227
|
|
Ceded
|
(38,173
|
)
|
|
(48,954
|
)
|
|
(82,115
|
)
|
|
(61,663
|
)
|
|
(94,945
|
)
|
|
(103,956
|
)
|
|
(206,541
|
)
|
|
(169,780
|
)
|
||||||||
Net
|
$
|
195,931
|
|
|
$
|
183,923
|
|
|
$
|
219,238
|
|
|
$
|
183,621
|
|
|
$
|
390,532
|
|
|
$
|
397,185
|
|
|
$
|
399,801
|
|
|
$
|
310,447
|
|
Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Gross
|
$
|
460
|
|
|
$
|
6,013
|
|
|
$
|
975
|
|
|
$
|
980
|
|
|
$
|
1,324
|
|
|
$
|
12,686
|
|
|
$
|
2,012
|
|
|
$
|
2,030
|
|
Ceded
|
1
|
|
|
(42
|
)
|
|
84
|
|
|
80
|
|
|
(18
|
)
|
|
(117
|
)
|
|
37
|
|
|
22
|
|
||||||||
Net
|
$
|
461
|
|
|
$
|
5,971
|
|
|
$
|
1,059
|
|
|
$
|
1,060
|
|
|
$
|
1,306
|
|
|
$
|
12,569
|
|
|
$
|
2,049
|
|
|
$
|
2,052
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Gross
|
$
|
274,143
|
|
|
$
|
336,325
|
|
|
$
|
342,950
|
|
|
$
|
309,247
|
|
|
$
|
559,488
|
|
|
$
|
738,614
|
|
|
$
|
705,798
|
|
|
$
|
598,024
|
|
Ceded
|
(44,198
|
)
|
|
(59,762
|
)
|
|
(89,731
|
)
|
|
(80,435
|
)
|
|
(106,776
|
)
|
|
(126,764
|
)
|
|
(229,432
|
)
|
|
(198,993
|
)
|
||||||||
Total
|
$
|
229,945
|
|
|
$
|
276,563
|
|
|
$
|
253,219
|
|
|
$
|
228,812
|
|
|
$
|
452,712
|
|
|
$
|
611,850
|
|
|
$
|
476,366
|
|
|
$
|
399,031
|
|
|
|
|
Intangible assets
|
|
|
||||||||||||||
|
Goodwill
|
|
Intangible
assets with
a definite life
|
|
Intangible
assets with
an indefinite life
|
|
Total
|
|
Total
|
||||||||||
Balance as of January 1, 2019
|
$
|
114,807
|
|
|
$
|
16,887
|
|
|
$
|
87,031
|
|
|
$
|
103,918
|
|
|
$
|
218,725
|
|
Amortization
|
—
|
|
|
(1,130
|
)
|
|
—
|
|
|
(1,130
|
)
|
|
(1,130
|
)
|
|||||
Balance as of June 30, 2019
|
$
|
114,807
|
|
|
$
|
15,757
|
|
|
$
|
87,031
|
|
|
$
|
102,788
|
|
|
$
|
217,595
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Intangible asset amortization
|
$
|
565
|
|
|
$
|
1,194
|
|
|
$
|
1,130
|
|
|
$
|
2,460
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Gross
Carrying
Value
|
|
Accumulated
Amortization
|
|
Net
Carrying
Value
|
|
Gross
Carrying
Value
|
|
Accumulated
Amortization
|
|
Net
Carrying
Value
|
||||||||||||
Intangible assets with a definite life:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Distribution channel
|
$
|
20,000
|
|
|
$
|
(7,444
|
)
|
|
$
|
12,556
|
|
|
$
|
20,000
|
|
|
$
|
(6,776
|
)
|
|
$
|
13,224
|
|
Technology
|
15,000
|
|
|
(14,890
|
)
|
|
110
|
|
|
15,000
|
|
|
(14,778
|
)
|
|
222
|
|
||||||
Brand
|
7,000
|
|
|
(3,909
|
)
|
|
3,091
|
|
|
7,000
|
|
|
(3,559
|
)
|
|
3,441
|
|
||||||
Total
|
$
|
42,000
|
|
|
$
|
(26,243
|
)
|
|
$
|
15,757
|
|
|
$
|
42,000
|
|
|
$
|
(25,113
|
)
|
|
$
|
16,887
|
|
Intangible assets with an indefinite life:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Lloyd’s syndicate capacity
|
$
|
37,031
|
|
|
$
|
—
|
|
|
$
|
37,031
|
|
|
$
|
37,031
|
|
|
$
|
—
|
|
|
$
|
37,031
|
|
Licenses
|
19,900
|
|
|
—
|
|
|
19,900
|
|
|
19,900
|
|
|
—
|
|
|
19,900
|
|
||||||
Management contract
|
30,100
|
|
|
—
|
|
|
30,100
|
|
|
30,100
|
|
|
—
|
|
|
30,100
|
|
||||||
Total
|
$
|
87,031
|
|
|
$
|
—
|
|
|
$
|
87,031
|
|
|
$
|
87,031
|
|
|
$
|
—
|
|
|
$
|
87,031
|
|
Facility
|
|
Origination Date
|
|
Term
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
4.50% Senior Notes due 2022
|
|
March 10, 2017
|
|
5 years
|
|
$
|
348,265
|
|
|
$
|
348,054
|
|
4.95% Senior Notes due 2029
|
|
May 28, 2019
|
|
10 years
|
|
493,594
|
|
|
—
|
|
||
Total senior notes
|
|
|
|
|
|
841,859
|
|
|
348,054
|
|
||
EGL Revolving Credit Facility
|
|
August 16, 2018
|
|
5 years
|
|
206,853
|
|
|
15,000
|
|
||
2018 EGL Term Loan Facility
|
|
December 27, 2018
|
|
3 years
|
|
448,735
|
|
|
498,485
|
|
||
Total debt obligations
|
|
|
|
$
|
1,497,447
|
|
|
$
|
861,539
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Interest expense on debt obligations
|
$
|
13,036
|
|
|
$
|
8,827
|
|
|
$
|
23,762
|
|
|
$
|
16,266
|
|
Funds withheld balances and other
|
—
|
|
|
95
|
|
|
310
|
|
|
667
|
|
||||
Total interest expense
|
$
|
13,036
|
|
|
$
|
8,922
|
|
|
$
|
24,072
|
|
|
$
|
16,933
|
|
|
|
Six Months Ended
|
|
For The Year Ended
|
||||
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Balance at beginning of period
|
|
$
|
458,543
|
|
|
$
|
479,606
|
|
Capital contributions
|
|
—
|
|
|
55,377
|
|
||
Dividends paid
|
|
(11,556
|
)
|
|
(3,852
|
)
|
||
Net losses attributable to RNCI
|
|
(5,461
|
)
|
|
(64,794
|
)
|
||
Accumulated other comprehensive earnings (losses) attributable to RNCI
|
|
155
|
|
|
(240
|
)
|
||
Change in redemption value of RNCI
|
|
(5,985
|
)
|
|
(7,554
|
)
|
||
Balance at end of period
|
|
$
|
435,696
|
|
|
$
|
458,543
|
|
|
|
|
|
|
|
|
|
Dividend per:
|
|
|
||||||||
Preferred Share Series
|
|
Date Declared
|
|
Record Date
|
|
Date Paid or Payable
|
|
Preferred Share
|
|
Depositary Share
|
|
Total dividends paid and declared in the six months ended June 30, 2019
|
||||||
|
|
|
|
|
|
|
|
(in U.S. dollars)
|
|
(in thousands of U.S. dollars)
|
||||||||
Series D
|
|
February 21,
2019 |
|
February 15,
2019 |
|
March 1,
2019 |
|
$
|
437.50
|
|
|
$
|
0.43750
|
|
|
$
|
7,000
|
|
Series E
|
|
February 21,
2019 |
|
February 15,
2019 |
|
March 1,
2019 |
|
$
|
486.11
|
|
|
$
|
0.48611
|
|
|
2,139
|
|
|
Series D
|
|
May 3,
2019 |
|
May 15,
2019 |
|
June 1,
2019 |
|
$
|
437.50
|
|
|
$
|
0.43750
|
|
|
7,000
|
|
|
Series E
|
|
May 3,
2019 |
|
May 15,
2019 |
|
June 1,
2019 |
|
$
|
437.50
|
|
|
$
|
0.43750
|
|
|
1,925
|
|
|
Series D
|
|
August 5,
2019 |
|
August 15,
2019 |
|
September 3,
2019 |
|
$
|
437.50
|
|
|
$
|
0.43750
|
|
|
—
|
|
|
Series E
|
|
August 5,
2019 |
|
August 15,
2019 |
|
September 3,
2019 |
|
$
|
437.50
|
|
|
$
|
0.43750
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
18,064
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Net earnings (loss) attributable to Enstar Group Limited ordinary shareholders
|
$
|
231,842
|
|
|
$
|
8,244
|
|
|
$
|
590,593
|
|
|
$
|
(32,966
|
)
|
Denominator:
|
|
|
|
|
|
|
|
||||||||
Weighted average ordinary shares outstanding — basic
|
21,477,772
|
|
|
20,462,788
|
|
|
21,470,675
|
|
|
19,938,815
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||||
Share-based compensation plans
|
138,464
|
|
|
128,232
|
|
|
131,798
|
|
|
122,471
|
|
||||
Warrants
|
59,215
|
|
|
80,212
|
|
|
59,296
|
|
|
79,081
|
|
||||
Weighted average ordinary shares outstanding — diluted
|
21,675,451
|
|
|
20,671,232
|
|
|
21,661,769
|
|
|
20,140,367
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings (losses) per ordinary share attributable to Enstar Group Limited:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
10.79
|
|
|
$
|
0.40
|
|
|
$
|
27.51
|
|
|
$
|
(1.65
|
)
|
Diluted(1)
|
$
|
10.70
|
|
|
$
|
0.40
|
|
|
$
|
27.26
|
|
|
$
|
(1.65
|
)
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Share-based compensation plans:
|
|
|
|
|
|
|
|
|
||||||||
Restricted shares and restricted share units
|
|
$
|
1,289
|
|
|
$
|
2,000
|
|
|
$
|
3,132
|
|
|
$
|
4,349
|
|
Performance share units
|
|
11,130
|
|
|
2,447
|
|
|
12,455
|
|
|
4,922
|
|
||||
Cash-settled stock appreciation rights
|
|
(267
|
)
|
|
7
|
|
|
(211
|
)
|
|
1,248
|
|
||||
Other share-based compensation plans:
|
|
|
|
|
|
|
|
|
||||||||
Northshore incentive plan
|
|
986
|
|
|
339
|
|
|
2,032
|
|
|
1,447
|
|
||||
Deferred compensation and ordinary share plan for non-employee directors
|
|
49
|
|
|
83
|
|
|
876
|
|
|
929
|
|
||||
Employee share purchase plan
|
|
104
|
|
|
127
|
|
|
207
|
|
|
210
|
|
||||
Total share-based compensation
|
|
$
|
13,291
|
|
|
$
|
5,003
|
|
|
$
|
18,491
|
|
|
$
|
13,105
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Pension plans:
|
|
|
|
|
|
|
|
|
||||||||
Defined contribution plans
|
|
$
|
2,941
|
|
|
$
|
3,184
|
|
|
$
|
5,795
|
|
|
$
|
5,822
|
|
Defined benefit plan
|
|
175
|
|
|
151
|
|
|
350
|
|
|
302
|
|
||||
Total pension costs
|
|
$
|
3,116
|
|
|
$
|
3,335
|
|
|
$
|
6,145
|
|
|
$
|
6,124
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||
Redeemable Noncontrolling Interest
|
417,533
|
|
|
439,428
|
|
•
|
Investments in funds (carried within other investments) managed by Stone Point, with respect to which we recognized net unrealized gains (losses);
|
•
|
Investments in registered investment companies affiliated with entities owned by Trident or otherwise affiliated with Stone Point, with respect to which we recognized net unrealized gains (losses) and interest income;
|
•
|
Separate accounts managed by Eagle Point Credit Management and PRIMA Capital Advisors, which are affiliates of entities owned by Trident, with respect to which we incurred management fees;
|
•
|
Investments in funds (carried within other investments) managed by Sound Point Capital, an entity in which Mr. Carey has an indirect minority ownership interest and serves as a director, with respect to which we recognized net unrealized gains (losses);
|
•
|
Sound Point Capital has acted as collateral manager for certain of our direct investments in CLO debt and equity securities, with respect to which we recognized net unrealized gains (losses) and interest income;
|
•
|
Marble Point Capital, which is an affiliate of an entity owned by Trident, has acted as collateral manager for certain of our direct investments in CLO equity securities, with respect to which we recognized net unrealized gains (losses) and interest income;
|
•
|
A separate account managed by Sound Point Capital, with respect to which we incurred management fees; and
|
•
|
In the fourth quarter of 2018, we invested $25.0 million in Mitchell TopCo Holdings, the parent company of Mitchell International and Genex Services, as a co-investor alongside Stone Point.
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Fixed maturities, trading, at fair value
|
$
|
332,121
|
|
|
$
|
176,193
|
|
Equities, at fair value
|
52,899
|
|
|
57,319
|
|
||
Other investments, at fair value:
|
|
|
|
||||
Hedge funds
|
20,335
|
|
|
19,535
|
|
||
Fixed income funds
|
526,128
|
|
|
324,561
|
|
||
Private equity funds
|
31,487
|
|
|
52,925
|
|
||
CLO equities
|
26,038
|
|
|
15,372
|
|
||
CLO equity funds
|
66,311
|
|
|
37,260
|
|
||
Private Debt
|
15,358
|
|
|
10,387
|
|
||
Real estate fund
|
12,214
|
|
|
8,025
|
|
||
Cash and cash equivalents
|
14,051
|
|
|
11,739
|
|
||
Other assets
|
—
|
|
|
5,216
|
|
||
Other liabilities
|
8,572
|
|
|
4,240
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net investment income
|
$
|
1,563
|
|
|
$
|
1,738
|
|
|
$
|
2,752
|
|
|
$
|
3,828
|
|
Net realized and unrealized gains (losses)
|
9,564
|
|
|
3,999
|
|
|
29,747
|
|
|
8,004
|
|
||||
Total net earnings
|
$
|
11,127
|
|
|
$
|
5,737
|
|
|
$
|
32,499
|
|
|
$
|
11,832
|
|
|
Six Months Ended
|
||
|
June 30, 2018
|
||
Management fee income
|
$
|
1,453
|
|
|
|
||
Transactions under KaylaRe-StarStone QS:
|
|
||
Ceded premium earned
|
(52,651
|
)
|
|
Net incurred losses
|
31,654
|
|
|
Acquisition costs
|
18,774
|
|
|
|
|
||
Total net earnings (loss)
|
$
|
(770
|
)
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
Investments in funds managed by Hillhouse Capital, held by equity method investees
|
$
|
219,175
|
|
|
$
|
75,192
|
|
Our ownership of equity method investments
|
47.4
|
%
|
|
47.4
|
%
|
||
Our indirect investment in funds managed by Hillhouse Capital
|
$
|
103,889
|
|
|
$
|
35,641
|
|
|
|
|
|
||||
Direct investment in funds managed by Hillhouse Capital:
|
|
|
|
||||
InRe Fund
|
$
|
816,844
|
|
|
$
|
678,420
|
|
Other funds
|
206,874
|
|
|
166,646
|
|
||
|
$
|
1,023,718
|
|
|
$
|
845,066
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Investment in Monument
|
$
|
54,442
|
|
|
$
|
42,193
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Investment in Clear Spring
|
$
|
9,700
|
|
|
$
|
10,070
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Balances under StarStone ceding quota share:
|
|
|
|
||||
Reinsurance balances recoverable
|
$
|
29,544
|
|
|
$
|
23,718
|
|
Prepaid insurance premiums
|
4,202
|
|
|
13,821
|
|
||
Ceded payable
|
11,768
|
|
|
14,153
|
|
||
Ceded acquisition costs
|
1,015
|
|
|
3,233
|
|
||
|
|
|
|
||||
Balances under assuming quota share:
|
|
|
|
||||
Losses and LAE
|
6,334
|
|
|
5,778
|
|
||
Unearned reinsurance premiums
|
1,050
|
|
|
3,455
|
|
||
Funds held
|
9,405
|
|
|
10,242
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Transactions under StarStone ceding quota share:
|
|
|
|
|
|
|
|
||||||||
Ceded premium earned
|
$
|
(4,271
|
)
|
|
$
|
(7,636
|
)
|
|
$
|
(9,756
|
)
|
|
$
|
(14,638
|
)
|
Ceded incurred losses and LAE
|
3,129
|
|
|
3,044
|
|
|
6,988
|
|
|
8,606
|
|
||||
Ceded acquisition costs
|
8
|
|
|
2,129
|
|
|
62
|
|
|
3,911
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Transactions under assuming quota share:
|
|
|
|
|
|
|
|
||||||||
Premium earned
|
1,068
|
|
|
158
|
|
|
2,439
|
|
|
1,909
|
|
||||
Net incurred losses and LAE
|
(472
|
)
|
|
629
|
|
|
(1,437
|
)
|
|
(761
|
)
|
||||
Acquisition costs
|
23
|
|
|
(91
|
)
|
|
9
|
|
|
(555
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Total net earnings (loss)
|
$
|
(515
|
)
|
|
$
|
(1,767
|
)
|
|
$
|
(1,695
|
)
|
|
$
|
(1,528
|
)
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Investment in AmTrust
|
$
|
200,000
|
|
|
$
|
200,000
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|||
|
June 30,
|
|
June 30,
|
|||
|
2019
|
|
2019
|
|||
|
|
|
|
|||
Net investment income
|
$
|
1,829
|
|
|
3,650
|
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
Investment in Citco
|
$
|
51,295
|
|
|
$
|
50,812
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Investment in Enhanzed Re
|
$
|
131,376
|
|
|
$
|
94,800
|
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
Other liabilities:
|
|
|
|
||||
Direct asbestos liabilities
|
$
|
249,120
|
|
|
$
|
265,975
|
|
Direct environmental liabilities
|
1,655
|
|
|
2,152
|
|
||
Estimated future expenses
|
17,539
|
|
|
19,843
|
|
||
Fair value adjustments
|
(84,050
|
)
|
|
(84,650
|
)
|
||
|
184,264
|
|
|
203,320
|
|
||
Other assets:
|
|
|
|
||||
Insurance recoveries related to direct asbestos and environmental liabilities
|
169,705
|
|
|
183,676
|
|
||
Fair value adjustments
|
(47,469
|
)
|
|
(47,868
|
)
|
||
|
122,236
|
|
|
135,808
|
|
||
|
|
|
|
||||
Net liabilities relating to direct asbestos and environmental exposures
|
$
|
62,028
|
|
|
$
|
67,512
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||
|
2019
|
|
2019
|
||||
Operating lease cost
|
$
|
3,199
|
|
|
$
|
6,686
|
|
Sublease income
|
(137
|
)
|
|
(268
|
)
|
||
Total lease cost
|
$
|
3,062
|
|
|
$
|
6,418
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||
|
2019
|
|
2019
|
||||
Operating cash flow information:
|
|
|
|
||||
Cash paid for amounts included in the measurement of lease liabilities
|
$
|
3,169
|
|
|
$
|
6,193
|
|
Non-cash activity:
|
|
|
|
||||
Right-of-use assets obtained in exchange for lease obligations
|
$
|
619
|
|
|
$
|
52,228
|
|
|
Balance sheet classification
|
|
June 30, 2019
|
||
Right-of-use assets
|
Other assets
|
|
$
|
47,026
|
|
Current lease liabilities
|
Other liabilities
|
|
8,852
|
|
|
Non-current lease liabilities
|
Other liabilities
|
|
38,670
|
|
|
|
June 30, 2019
|
|
Weighted-average remaining lease term
|
|
6.6 years
|
|
Weighted-average discount rate
|
|
6.2
|
%
|
|
|
June 30, 2019
|
||
2019
|
|
$
|
4,508
|
|
2020
|
|
12,684
|
|
|
2021
|
|
9,523
|
|
|
2022
|
|
7,689
|
|
|
2023
|
|
7,016
|
|
|
2024 and beyond
|
|
17,891
|
|
|
Total lease payments
|
|
59,311
|
|
|
Less: Imputed interest
|
|
(11,789
|
)
|
|
Present value of lease liabilities
|
|
$
|
47,522
|
|
|
Three Months Ended June 30, 2019
|
||||||||||||||||||
|
Non-Life
Run-Off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
Gross premiums written
|
$
|
(4,209
|
)
|
|
$
|
43,788
|
|
|
$
|
234,104
|
|
|
$
|
460
|
|
|
$
|
274,143
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net premiums written
|
$
|
(3,409
|
)
|
|
$
|
36,962
|
|
|
$
|
195,931
|
|
|
$
|
461
|
|
|
$
|
229,945
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net premiums earned
|
$
|
48,470
|
|
|
$
|
38,199
|
|
|
$
|
183,923
|
|
|
$
|
5,971
|
|
|
$
|
276,563
|
|
Net incurred losses and LAE
|
(9,752
|
)
|
|
(13,048
|
)
|
|
(189,073
|
)
|
|
(4,465
|
)
|
|
(216,338
|
)
|
|||||
Life and Annuity Policy Benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,194
|
)
|
|
(2,194
|
)
|
|||||
Acquisition costs
|
(16,512
|
)
|
|
(12,815
|
)
|
|
(37,383
|
)
|
|
(145
|
)
|
|
(66,855
|
)
|
|||||
Operating expenses
|
(44,208
|
)
|
|
(3,193
|
)
|
|
(33,352
|
)
|
|
—
|
|
|
(80,753
|
)
|
|||||
Underwriting income (loss)
|
(22,002
|
)
|
|
9,143
|
|
|
(75,885
|
)
|
|
(833
|
)
|
|
(89,577
|
)
|
|||||
Net investment income (loss)
|
65,857
|
|
|
2,053
|
|
|
12,268
|
|
|
(2,446
|
)
|
|
77,732
|
|
|||||
Net realized and unrealized gains
|
241,542
|
|
|
1,969
|
|
|
21,655
|
|
|
4,545
|
|
|
269,711
|
|
|||||
Fees and commission income
|
4,645
|
|
|
1,533
|
|
|
—
|
|
|
—
|
|
|
6,178
|
|
|||||
Other income
|
9,917
|
|
|
35
|
|
|
319
|
|
|
759
|
|
|
11,030
|
|
|||||
Corporate expenses
|
(18,734
|
)
|
|
(3,502
|
)
|
|
—
|
|
|
(14,530
|
)
|
|
(36,766
|
)
|
|||||
Interest income (expense)
|
(15,619
|
)
|
|
—
|
|
|
—
|
|
|
2,583
|
|
|
(13,036
|
)
|
|||||
Net foreign exchange gains (losses)
|
3,752
|
|
|
98
|
|
|
(1,236
|
)
|
|
(27
|
)
|
|
2,587
|
|
|||||
EARNINGS (LOSS) BEFORE INCOME TAXES
|
269,358
|
|
|
11,329
|
|
|
(42,879
|
)
|
|
(9,949
|
)
|
|
227,859
|
|
|||||
Income tax benefit (expense)
|
(7,399
|
)
|
|
(1,023
|
)
|
|
904
|
|
|
—
|
|
|
(7,518
|
)
|
|||||
Earnings (loss) from equity method investments
|
18,119
|
|
|
—
|
|
|
(406
|
)
|
|
—
|
|
|
17,713
|
|
|||||
NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS
|
280,078
|
|
|
10,306
|
|
|
(42,381
|
)
|
|
(9,949
|
)
|
|
238,054
|
|
|||||
Net loss (earnings) attributable to noncontrolling interest
|
(2,266
|
)
|
|
(4,227
|
)
|
|
9,206
|
|
|
—
|
|
|
2,713
|
|
|||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR GROUP LIMITED
|
277,812
|
|
|
6,079
|
|
|
(33,175
|
)
|
|
(9,949
|
)
|
|
240,767
|
|
|||||
Dividends on preferred shares
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,925
|
)
|
|
(8,925
|
)
|
|||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR GROUP LIMITED ORDINARY SHAREHOLDERS
|
$
|
277,812
|
|
|
$
|
6,079
|
|
|
$
|
(33,175
|
)
|
|
$
|
(18,874
|
)
|
|
$
|
231,842
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Underwriting ratios:
|
|
|
|
|
|
|
|
|
|
||||||||||
Loss ratio
|
|
|
34.2
|
%
|
|
102.8
|
%
|
|
|
|
|
||||||||
Acquisition expense ratio
|
|
|
33.5
|
%
|
|
20.3
|
%
|
|
|
|
|
||||||||
Operating expense ratio
|
|
|
8.4
|
%
|
|
18.2
|
%
|
|
|
|
|
||||||||
Combined ratio
|
|
|
76.1
|
%
|
|
141.3
|
%
|
|
|
|
|
|
Three Months Ended June 30, 2018
|
||||||||||||||||||
|
Non-Life
Run-Off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
Gross premiums written
|
$
|
(938
|
)
|
|
$
|
41,560
|
|
|
$
|
301,353
|
|
|
$
|
975
|
|
|
$
|
342,950
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net premiums written
|
$
|
(1,661
|
)
|
|
$
|
34,583
|
|
|
$
|
219,238
|
|
|
$
|
1,059
|
|
|
$
|
253,219
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net premiums earned
|
$
|
9,609
|
|
|
$
|
34,522
|
|
|
$
|
183,621
|
|
|
$
|
1,060
|
|
|
$
|
228,812
|
|
Net incurred losses and LAE
|
70,134
|
|
|
(16,926
|
)
|
|
(146,027
|
)
|
|
—
|
|
|
(92,819
|
)
|
|||||
Life and Annuity Policy Benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
160
|
|
|
160
|
|
|||||
Acquisition costs
|
(3,214
|
)
|
|
(12,716
|
)
|
|
(37,271
|
)
|
|
(133
|
)
|
|
(53,334
|
)
|
|||||
Operating expenses
|
(38,378
|
)
|
|
(4,130
|
)
|
|
(34,142
|
)
|
|
—
|
|
|
(76,650
|
)
|
|||||
Underwriting income (loss)
|
38,151
|
|
|
750
|
|
|
(33,819
|
)
|
|
1,087
|
|
|
6,169
|
|
|||||
Net investment income (loss)
|
57,291
|
|
|
1,285
|
|
|
8,745
|
|
|
(852
|
)
|
|
66,469
|
|
|||||
Net realized and unrealized losses
|
(46,027
|
)
|
|
(680
|
)
|
|
(3,181
|
)
|
|
(4,530
|
)
|
|
(54,418
|
)
|
|||||
Fees and commission income
|
4,487
|
|
|
3,865
|
|
|
—
|
|
|
—
|
|
|
8,352
|
|
|||||
Other income (expense)
|
(9,334
|
)
|
|
56
|
|
|
(600
|
)
|
|
527
|
|
|
(9,351
|
)
|
|||||
Corporate expenses
|
(13,387
|
)
|
|
(1,838
|
)
|
|
—
|
|
|
(10,737
|
)
|
|
(25,962
|
)
|
|||||
Interest income (expense)
|
(10,081
|
)
|
|
—
|
|
|
(6
|
)
|
|
1,165
|
|
|
(8,922
|
)
|
|||||
Net foreign exchange gains (losses)
|
6,958
|
|
|
(47
|
)
|
|
(1,573
|
)
|
|
181
|
|
|
5,519
|
|
|||||
EARNINGS (LOSS) BEFORE INCOME TAXES
|
28,058
|
|
|
3,391
|
|
|
(30,434
|
)
|
|
(13,159
|
)
|
|
(12,144
|
)
|
|||||
Income tax expense
|
(1,219
|
)
|
|
(739
|
)
|
|
(1,688
|
)
|
|
—
|
|
|
(3,646
|
)
|
|||||
Earnings from equity method investments
|
15,645
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,645
|
|
|||||
NET EARNINGS (LOSS)
|
42,484
|
|
|
2,652
|
|
|
(32,122
|
)
|
|
(13,159
|
)
|
|
(145
|
)
|
|||||
Net loss (earnings) attributable to noncontrolling interest
|
(1,094
|
)
|
|
(1,121
|
)
|
|
10,604
|
|
|
—
|
|
|
8,389
|
|
|||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR GROUP LIMITED ORDINARY SHAREHOLDERS
|
$
|
41,390
|
|
|
$
|
1,531
|
|
|
$
|
(21,518
|
)
|
|
$
|
(13,159
|
)
|
|
$
|
8,244
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Underwriting ratios:
|
|
|
|
|
|
|
|
|
|
||||||||||
Loss ratio
|
|
|
49.0
|
%
|
|
79.5
|
%
|
|
|
|
|
||||||||
Acquisition expense ratio
|
|
|
36.8
|
%
|
|
20.3
|
%
|
|
|
|
|
||||||||
Operating expense ratio
|
|
|
12.0
|
%
|
|
18.6
|
%
|
|
|
|
|
||||||||
Combined ratio
|
|
|
97.8
|
%
|
|
118.4
|
%
|
|
|
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||
|
Non-Life
Run-Off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
Gross premiums written
|
$
|
(25,086
|
)
|
|
$
|
97,773
|
|
|
$
|
485,477
|
|
|
$
|
1,324
|
|
|
$
|
559,488
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net premiums written
|
$
|
(22,587
|
)
|
|
$
|
83,461
|
|
|
$
|
390,532
|
|
|
$
|
1,306
|
|
|
$
|
452,712
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net premiums earned
|
$
|
125,144
|
|
|
$
|
76,952
|
|
|
$
|
397,185
|
|
|
$
|
12,569
|
|
|
$
|
611,850
|
|
Net incurred losses and LAE
|
(104,934
|
)
|
|
(30,262
|
)
|
|
(384,125
|
)
|
|
(9,421
|
)
|
|
(528,742
|
)
|
|||||
Life and Annuity Policy Benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,290
|
)
|
|
(2,290
|
)
|
|||||
Acquisition costs
|
(44,667
|
)
|
|
(26,557
|
)
|
|
(89,042
|
)
|
|
(377
|
)
|
|
(160,643
|
)
|
|||||
Operating expenses
|
(88,200
|
)
|
|
(6,226
|
)
|
|
(69,346
|
)
|
|
—
|
|
|
(163,772
|
)
|
|||||
Underwriting income (loss)
|
(112,657
|
)
|
|
13,907
|
|
|
(145,328
|
)
|
|
481
|
|
|
(243,597
|
)
|
|||||
Net investment income (loss)
|
132,585
|
|
|
3,764
|
|
|
24,210
|
|
|
(4,131
|
)
|
|
156,428
|
|
|||||
Net realized and unrealized gains
|
677,728
|
|
|
4,882
|
|
|
42,313
|
|
|
5,579
|
|
|
730,502
|
|
|||||
Fees and commission income
|
9,477
|
|
|
3,382
|
|
|
—
|
|
|
—
|
|
|
12,859
|
|
|||||
Other income
|
15,421
|
|
|
71
|
|
|
379
|
|
|
971
|
|
|
16,842
|
|
|||||
Corporate expenses
|
(35,304
|
)
|
|
(7,290
|
)
|
|
—
|
|
|
(23,227
|
)
|
|
(65,821
|
)
|
|||||
Interest income (expense)
|
(27,735
|
)
|
|
—
|
|
|
(475
|
)
|
|
4,138
|
|
|
(24,072
|
)
|
|||||
Net foreign exchange gains (losses)
|
7,370
|
|
|
923
|
|
|
(1,830
|
)
|
|
(26
|
)
|
|
6,437
|
|
|||||
EARNINGS (LOSS) BEFORE INCOME TAXES
|
666,885
|
|
|
19,639
|
|
|
(80,731
|
)
|
|
(16,215
|
)
|
|
589,578
|
|
|||||
Income tax expense
|
(10,119
|
)
|
|
(1,708
|
)
|
|
(355
|
)
|
|
(85
|
)
|
|
(12,267
|
)
|
|||||
Equity in earnings of affiliates
|
26,703
|
|
|
—
|
|
|
(218
|
)
|
|
—
|
|
|
26,485
|
|
|||||
NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS
|
683,469
|
|
|
17,931
|
|
|
(81,304
|
)
|
|
(16,300
|
)
|
|
603,796
|
|
|||||
Net loss (earnings) attributable to noncontrolling interest
|
(4,912
|
)
|
|
(7,355
|
)
|
|
17,128
|
|
|
—
|
|
|
4,861
|
|
|||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR GROUP LIMITED
|
678,557
|
|
|
10,576
|
|
|
(64,176
|
)
|
|
(16,300
|
)
|
|
608,657
|
|
|||||
Dividends on preferred shares
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,064
|
)
|
|
(18,064
|
)
|
|||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR GROUP LIMITED ORDINARY SHAREHOLDERS
|
$
|
678,557
|
|
|
$
|
10,576
|
|
|
$
|
(64,176
|
)
|
|
$
|
(34,364
|
)
|
|
$
|
590,593
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Underwriting ratios:
|
|
|
|
|
|
|
|
|
|
||||||||||
Loss ratio
|
|
|
39.3
|
%
|
|
96.7
|
%
|
|
|
|
|
||||||||
Acquisition expense ratio
|
|
|
34.5
|
%
|
|
22.4
|
%
|
|
|
|
|
||||||||
Operating expense ratio
|
|
|
8.1
|
%
|
|
17.5
|
%
|
|
|
|
|
||||||||
Combined ratio
|
|
|
81.9
|
%
|
|
136.6
|
%
|
|
|
|
|
|
Six Months Ended June 30, 2018
|
||||||||||||||||||
|
Non-Life
Run-Off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
Gross premiums written
|
$
|
6,442
|
|
|
$
|
91,002
|
|
|
$
|
606,342
|
|
|
$
|
2,012
|
|
|
$
|
705,798
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net premiums written
|
$
|
(1,561
|
)
|
|
$
|
76,077
|
|
|
$
|
399,801
|
|
|
$
|
2,049
|
|
|
$
|
476,366
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net premiums earned
|
$
|
16,787
|
|
|
$
|
69,745
|
|
|
$
|
310,447
|
|
|
$
|
2,052
|
|
|
$
|
399,031
|
|
Net incurred losses and LAE
|
143,112
|
|
|
(34,098
|
)
|
|
(221,367
|
)
|
|
—
|
|
|
(112,353
|
)
|
|||||
Life and Annuity Policy Benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
206
|
|
|
206
|
|
|||||
Acquisition costs
|
(4,684
|
)
|
|
(24,781
|
)
|
|
(53,696
|
)
|
|
(281
|
)
|
|
(83,442
|
)
|
|||||
Operating expenses
|
(76,781
|
)
|
|
(8,307
|
)
|
|
(68,699
|
)
|
|
—
|
|
|
(153,787
|
)
|
|||||
Underwriting income (loss)
|
78,434
|
|
|
2,559
|
|
|
(33,315
|
)
|
|
1,977
|
|
|
49,655
|
|
|||||
Net investment income (loss)
|
108,942
|
|
|
2,470
|
|
|
16,446
|
|
|
4,930
|
|
|
132,788
|
|
|||||
Net realized and unrealized losses
|
(172,323
|
)
|
|
(2,083
|
)
|
|
(16,139
|
)
|
|
(6,903
|
)
|
|
(197,448
|
)
|
|||||
Fees and commission income
|
9,385
|
|
|
7,298
|
|
|
—
|
|
|
—
|
|
|
16,683
|
|
|||||
Other income (expense)
|
(6,776
|
)
|
|
120
|
|
|
(549
|
)
|
|
(203
|
)
|
|
(7,408
|
)
|
|||||
Corporate expenses
|
(22,020
|
)
|
|
(2,313
|
)
|
|
—
|
|
|
(19,752
|
)
|
|
(44,085
|
)
|
|||||
Interest income (expense)
|
(18,611
|
)
|
|
—
|
|
|
(547
|
)
|
|
2,225
|
|
|
(16,933
|
)
|
|||||
Net foreign exchange gains (losses)
|
(219
|
)
|
|
(1,000
|
)
|
|
(478
|
)
|
|
1,348
|
|
|
(349
|
)
|
|||||
EARNINGS (LOSS) BEFORE INCOME TAXES
|
(23,188
|
)
|
|
7,051
|
|
|
(34,582
|
)
|
|
(16,378
|
)
|
|
(67,097
|
)
|
|||||
Income tax expense
|
(102
|
)
|
|
(1,019
|
)
|
|
(2,686
|
)
|
|
(11
|
)
|
|
(3,818
|
)
|
|||||
Equity in earnings of affiliates
|
30,342
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30,342
|
|
|||||
NET EARNINGS (LOSS)
|
7,052
|
|
|
6,032
|
|
|
(37,268
|
)
|
|
(16,389
|
)
|
|
(40,573
|
)
|
|||||
Net loss (earnings) attributable to noncontrolling interest
|
(2,523
|
)
|
|
(2,532
|
)
|
|
12,662
|
|
|
—
|
|
|
7,607
|
|
|||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR GROUP LIMITED ORDINARY SHAREHOLDERS
|
$
|
4,529
|
|
|
$
|
3,500
|
|
|
$
|
(24,606
|
)
|
|
$
|
(16,389
|
)
|
|
$
|
(32,966
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Underwriting ratios:
|
|
|
|
|
|
|
|
|
|
||||||||||
Loss ratio
|
|
|
48.9
|
%
|
|
71.3
|
%
|
|
|
|
|
||||||||
Acquisition expense ratio
|
|
|
35.5
|
%
|
|
17.3
|
%
|
|
|
|
|
||||||||
Operating expense ratio
|
|
|
11.9
|
%
|
|
22.1
|
%
|
|
|
|
|
||||||||
Combined ratio
|
|
|
96.3
|
%
|
|
110.7
|
%
|
|
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||||
Assets by Segment:
|
|
|
|
||||
Non-life Run-off
|
$
|
14,901,331
|
|
|
$
|
13,362,749
|
|
Atrium
|
558,014
|
|
|
591,722
|
|
||
StarStone
|
3,499,784
|
|
|
3,416,132
|
|
||
Other
|
(734,287
|
)
|
|
(814,333
|
)
|
||
Total assets
|
$
|
18,224,842
|
|
|
$
|
16,556,270
|
|
Section
|
|
Page
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
June 30,
2019 |
|
December 31,
2018 |
|
Change
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Total Enstar Group Limited Shareholder's Equity
|
$
|
4,514,830
|
|
|
$
|
3,901,933
|
|
|
$
|
612,897
|
|
Less: Series D and E Preferred Shares
|
510,000
|
|
|
510,000
|
|
|
—
|
|
|||
Total Enstar Group Limited Ordinary Shareholders' Equity (A)
|
4,004,830
|
|
|
3,391,933
|
|
|
612,897
|
|
|||
Proceeds from assumed conversion of warrants(1)
|
20,229
|
|
|
20,229
|
|
|
—
|
|
|||
Numerator for fully diluted book value per ordinary share calculations (B)
|
$
|
4,025,059
|
|
|
$
|
3,412,162
|
|
|
$
|
612,897
|
|
|
|
|
|
|
|
||||||
Denominator:
|
|
|
|
|
|
||||||
Ordinary shares outstanding (C)
|
21,484,537
|
|
|
21,459,997
|
|
|
24,540
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
||||||
Share-based compensation plans
|
286,231
|
|
|
245,165
|
|
|
41,066
|
|
|||
Warrants(1)
|
175,901
|
|
|
175,901
|
|
|
—
|
|
|||
Fully diluted ordinary shares outstanding (D)
|
21,946,669
|
|
|
21,881,063
|
|
|
65,606
|
|
|||
|
|
|
|
|
|
||||||
Book value per ordinary share:
|
|
|
|
|
|
||||||
Basic book value per ordinary share = (A) / (C)
|
$
|
186.41
|
|
|
$
|
158.06
|
|
|
$
|
28.35
|
|
Fully diluted book value per ordinary share = (B) / (D)
|
$
|
183.40
|
|
|
$
|
155.94
|
|
|
$
|
27.46
|
|
•
|
an adverse development cover reinsurance transaction with Maiden Re Bermuda, effective January 1, 2019, for losses incurred on or prior to December 31, 2018 in excess of a $2.178 billion retention up to a $600.0 million limit, in exchange for consideration of $445.0 million, as described further below.
|
•
|
a reinsurance transaction with Zurich Insurance Group ("Zurich"), pursuant to which we will reinsure approximately $500.0 million of asbestos and environmental reserves relating to 1986 and prior years. Completion is expected to occur in 2019.
|
•
|
Net investment income. In a rising interest rate environment, our net investment income would improve as maturities are reinvested at higher rates. Conversely, in a declining interest rate environment, our net investment income would decline as maturities are reinvested at lower rates. All else being equal, we would also expect our net investment income to grow as total investable assets increase as we acquire more business, partially offset by reductions in the investment portfolio for paid claims.
|
•
|
Net realized and unrealized gains or losses. These arise from investments in fixed maturities, funds held, equity securities and other investments. Given the nature of our investments in fixed maturities and the average duration of our fixed maturity securities, the return of our fixed maturities investments will be impacted by changes in interest rates. In a rising rate environment, these securities may experience unrealized losses prior to maturity. Conversely, in a declining rate environment, securities may experience unrealized gains prior to maturity. During the first six months of 2019, we recognized net unrealized gains on our investments of $704.1 million, of which $342.9 million and $74.2 million related to our investments in fixed maturities, trading and funds withheld - directly managed, respectively, primarily due to tightening credit spreads. We generally account for our fixed maturity securities as "trading", whereas other companies in our industry may use "available-for-sale" accounting. The difference is that unrealized changes on investments classified as trading are recorded through earnings, whereas unrealized changes on investments classified as available-for-sale are recorded directly in shareholders' equity. We may therefore experience further unrealized gains and losses on our fixed maturity investments, depending on investment market conditions and general economic conditions. Unrealized amounts would only become realized in the event of a sale of the specific securities prior to maturity or a credit default. For further information on the sensitivity of our portfolio to changes in interest rates, refer to the Interest Rate Risk section within Item 3. "Quantitative and Qualitative Disclosures About Market Risk", included within this Quarterly Report on Form 10-Q. For further discussion of our investments, see "Investable Assets" below. During the first six months of 2019, we recognized net unrealized gains on our other investments of $265.8 million, compared to net unrealized losses of $164.0 million for the year ended 2018. We believe our other investments provide diversification against our fixed income investments and an opportunity for improved risk-adjusted returns. However, the returns of these investments may be relatively volatile, and we may experience significant unrealized gains or losses in a particular quarter or year.
|
•
|
Consolidated net earnings of $231.8 million and basic and diluted net earnings per ordinary share of $10.79 and $10.70, respectively.
|
•
|
Non-GAAP operating income of $103.2 million and diluted non-GAAP operating income per ordinary share of $4.76. For a reconciliation of non-GAAP operating income to net earnings (loss) calculated in accordance with GAAP and diluted non-GAAP operating income per ordinary share to diluted net earnings (loss) per ordinary share calculated in accordance with GAAP, see "Non-GAAP Financial Measures" below.
|
•
|
Net earnings from Non-life Run-off segment of $277.8 million, including investment results.
|
•
|
Net investment income of $77.7 million and net realized and unrealized gains of $269.7 million comprised $26.1 million of net realized gains and $243.6 million of net unrealized gains.
|
•
|
Net premiums earned of $276.6 million, including $38.2 million and $183.9 million in our Atrium and StarStone segments, respectively.
|
•
|
Combined ratios of 76.1% and 141.3% for the active underwriting operations within our Atrium and StarStone segments, respectively.
|
•
|
Consolidated net earnings of $590.6 million and basic and diluted net earnings per ordinary share of $27.51 and $27.26, respectively.
|
•
|
Non-GAAP operating income of $302.9 million and diluted non-GAAP operating income per ordinary share of $13.98. For a reconciliation of non-GAAP operating income to net earnings (loss) calculated in accordance with GAAP and diluted non-GAAP operating income per ordinary share to diluted net earnings (loss) per ordinary share calculated in accordance with GAAP, see "Non-GAAP Financial Measures" below.
|
•
|
Net earnings from Non-life Run-off segment of $678.6 million, including investment results.
|
•
|
Net investment income of $156.4 million and net realized and unrealized gains of $730.5 million, comprised of $26.4 million of net realized gains and $704.1 million of net unrealized gains.
|
•
|
Net premiums earned of $611.9 million, including $77.0 million and $397.2 million in our Atrium and StarStone segments, respectively.
|
•
|
Combined ratios of 81.9% and 136.6% for the active underwriting operations within our Atrium and StarStone segments, respectively.
|
•
|
Total investments, cash and funds held of $14,102.4 million.
|
•
|
Total reinsurance balances recoverable of $2,243.5 million.
|
•
|
Total assets of $18,224.8 million.
|
•
|
Total gross reserves for losses and LAE of $9,833.9 million, with $946.1 million of gross reserves assumed in our Non-life Run-off operations during the six months ended June 30, 2019.
|
•
|
Total Enstar Group Limited shareholders' equity, including preferred shares, of $4,514.8 million and redeemable noncontrolling interest of $435.7 million. Shareholders' equity includes $510.0 million of preferred shares issued in 2018.
|
•
|
Diluted book value per ordinary share of $183.40, an increase of 17.6% since December 31, 2018.
|
•
|
Non-life Run-off - Net earnings attributable to the Non-life Run-off segment were $277.8 million for the three months ended June 30, 2019 compared to $41.4 million for the three months ended June 30, 2018. The increase in net earnings of $236.4 million was primarily due to net realized and unrealized gains of $241.5 million on our investment portfolio in the current period compared to net losses in the comparative period, and higher other income, partially offset by an increase in net incurred losses and LAE in the current period compared to a reduction in net incurred losses and LAE in the comparative period;
|
•
|
Atrium - Net earnings were $6.1 million for the three months ended June 30, 2019 compared to $1.5 million for the three months ended June 30, 2018. The increase in net earnings was primarily due to improved underwriting income due to lower loss and other expense ratios and higher net realized and unrealized gains on our investment portfolio;
|
•
|
StarStone - Net losses were $33.2 million for the three months ended June 30, 2019 compared to net losses of $21.5 million for the three months ended June 30, 2018. The increase in net losses was primarily attributable to higher net incurred losses and LAE, partially offset by increased net realized and unrealized gains on our investment portfolio. The increase in net incurred losses and LAE was primarily due to prior year net unfavorable loss development across exited lines and our U.S. casualty line of business. The segment results in 2019 also include the consolidation of StarStone Group's reinsurance to KaylaRe following Enstar's acquisition of the portion of KaylaRe it did not already own, and the results of a loss portfolio transfer on discontinued lines;
|
•
|
Net Realized and Unrealized Gains (Losses) - Net realized and unrealized gains were $269.7 million for the three months ended June 30, 2019 compared to net realized and unrealized losses of $54.4 million for the three months ended June 30, 2018. Net unrealized gains for the three months ended June 30, 2019 included net unrealized gains of $133.4 million on fixed maturities investments, which are accounted for on a trading basis through net earnings, and gains of $61.1 million on other investments. The unrealized gains on fixed maturities were primarily driven by tightening corporate credit spreads. Many insurance companies use available-for-sale accounting where unrealized amounts are recorded directly to shareholders’ equity and therefore do not impact earnings. Unrealized amounts would only become realized in the event of a sale of the specific securities prior to maturity or a credit default. The net unrealized gains on our other investments were primarily driven by unrealized gains in our equity, fixed income and hedge funds, as a result of strong results in the global equity and fixed income markets in the second quarter of 2019;
|
•
|
Net Investment Income - Net investment income was $77.7 million and $66.5 million for the three months ended June 30, 2019 and 2018, respectively. The increase was primarily due to an increase in average investable assets in our Non-Life Run-off segment due to the transactions noted above, and higher reinvestment rates;
|
•
|
Noncontrolling Interest - The net (earnings) losses attributable to the noncontrolling interest are directly related to the results from those subsidiary companies in which there are either noncontrolling interests or redeemable noncontrolling interests. The net losses attributable to noncontrolling interest were $2.7 million for the three months ended June 30, 2019 compared to net losses attributable to noncontrolling interest of $8.4 million for the three months ended June 30, 2018. The net losses attributable to noncontrolling interest were primarily driven by the losses in the StarStone segment, as discussed above, partially offset by the net earnings in our Non-life Run-off and Atrium segments;
|
•
|
Our non-GAAP operating income, which excludes the impact of net realized and unrealized gains and losses on fixed maturity securities and other items, was $103.2 million for the three months ended June 30, 2019, an increase of $20.3 million from non-GAAP operating income of $83.0 million for the three months ended June 30, 2018. For a reconciliation of non-GAAP operating income to net earnings (loss) calculated in accordance with GAAP, see "Non-GAAP Financial Measures" below. The increase primarily related to unrealized gains on other investments during the three months ended June 30, 2019.
|
•
|
Non-life Run-off - Net earnings attributable to the Non-life Run-off segment were $678.6 million and $4.5 million for the six months ended June 30, 2019 and 2018, respectively. The increase in net earnings of $674.0 million was primarily due to net realized and unrealized gains on our investment portfolio in the current period, higher investment income and higher other income, partially offset by an increase in net incurred losses and LAE in the current period;
|
•
|
Net Investment Income - Net investment income was $156.4 million and $132.8 million for the six months ended June 30, 2019 and 2018, respectively. The increase of $23.6 million was primarily attributable to an increase in average investable assets due to the transactions noted above and higher reinvestment rates;
|
•
|
Net Realized and Unrealized Gains (Losses) - Net realized and unrealized gains were $730.5 million for the six months ended June 30, 2019 compared to net realized and unrealized losses of $197.4 million for the six months ended June 30, 2018. Net unrealized gains for the six months ended June 30, 2019 included net unrealized gains of $342.9 million on fixed maturities investments, which are accounted for on a trading basis through net earnings and unrealized gains of $265.8 million on other investments. The unrealized gains on fixed maturities were primarily driven by decreased sovereign yields and tightening corporate credit spreads in the current period and the unrealized gains on other investments were principally driven by tightening credit spreads and a more favorable movement in international equity markets in 2019;
|
•
|
Atrium - Net earnings for the six months ended June 30, 2019 and 2018 were $10.6 million and $3.5 million, respectively. The increase was primarily attributable to higher net earned premium, a lower loss ratio in the current period and higher unrealized gains, partially offset by higher earnings attributable to noncontrolling interest;
|
•
|
StarStone - Net losses were $64.2 million and $24.6 million for the six months ended June 30, 2019 and 2018, respectively. The increase in net losses was primarily attributable to the increase in net incurred losses and LAE and higher acquisition costs, partially offset by net realized and unrealized gains on our investment portfolio, higher net earned premiums and higher losses attributable to noncontrolling interest;
|
•
|
Other Activities - Net losses were $34.4 million and $16.4 million for the six months ended June 30, 2019 and 2018, respectively, with the increase in net losses primarily attributable to dividends on preferred shares, partially offset by higher net realized and unrealized gains;
|
•
|
Noncontrolling Interest - For the six months ended June 30, 2019 and 2018, the net losses attributable to noncontrolling interest were $4.9 million and $7.6 million, respectively, primarily reflecting losses from the StarStone segment and partially offset by net earnings in the Atrium segment, as discussed above; and
|
•
|
Non-GAAP operating income - Our Non-GAAP operating income, which excludes the impact of net realized and unrealized gains and losses on fixed maturity securities and other items, was $302.9 million for the six months ended June 30, 2019, an increase of $180.3 million from non-GAAP operating income of $122.6 million for the six months ended June 30, 2018. For a reconciliation of non-GAAP operating income to net earnings (loss) calculated in accordance with GAAP, see "Non-GAAP Financial Measures" below.
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
||||||||||||||||
|
June 30,
|
|
|
|
June 30,
|
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Segment split of net earnings (loss) attributable to Enstar Group Limited:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Non-life Run-off
|
$
|
277,812
|
|
|
$
|
41,390
|
|
|
$
|
236,422
|
|
|
$
|
678,557
|
|
|
$
|
4,529
|
|
|
$
|
674,028
|
|
Atrium
|
6,079
|
|
|
1,531
|
|
|
4,548
|
|
|
10,576
|
|
|
3,500
|
|
|
7,076
|
|
||||||
StarStone
|
(33,175
|
)
|
|
(21,518
|
)
|
|
(11,657
|
)
|
|
(64,176
|
)
|
|
(24,606
|
)
|
|
(39,570
|
)
|
||||||
Other
|
(18,874
|
)
|
|
(13,159
|
)
|
|
(5,715
|
)
|
|
(34,364
|
)
|
|
(16,389
|
)
|
|
(17,975
|
)
|
||||||
Net earnings (loss) attributable to Enstar Group Limited ordinary shareholders
|
$
|
231,842
|
|
|
$
|
8,244
|
|
|
$
|
223,598
|
|
|
$
|
590,593
|
|
|
$
|
(32,966
|
)
|
|
$
|
623,559
|
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
||||||||||||||||
|
June 30,
|
|
|
|
June 30,
|
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Gross premiums written
|
$
|
(4,209
|
)
|
|
$
|
(938
|
)
|
|
$
|
(3,271
|
)
|
|
$
|
(25,086
|
)
|
|
$
|
6,442
|
|
|
$
|
(31,528
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net premiums written
|
$
|
(3,409
|
)
|
|
$
|
(1,661
|
)
|
|
$
|
(1,748
|
)
|
|
$
|
(22,587
|
)
|
|
$
|
(1,561
|
)
|
|
$
|
(21,026
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net premiums earned
|
$
|
48,470
|
|
|
$
|
9,609
|
|
|
$
|
38,861
|
|
|
$
|
125,144
|
|
|
$
|
16,787
|
|
|
$
|
108,357
|
|
Net incurred losses and LAE (1)
|
(9,752
|
)
|
|
70,134
|
|
|
(79,886
|
)
|
|
(104,934
|
)
|
|
143,112
|
|
|
(248,046
|
)
|
||||||
Acquisition costs
|
(16,512
|
)
|
|
(3,214
|
)
|
|
(13,298
|
)
|
|
(44,667
|
)
|
|
(4,684
|
)
|
|
(39,983
|
)
|
||||||
Operating expenses
|
(44,208
|
)
|
|
(38,378
|
)
|
|
(5,830
|
)
|
|
(88,200
|
)
|
|
(76,781
|
)
|
|
(11,419
|
)
|
||||||
Underwriting income (1)
|
(22,002
|
)
|
|
38,151
|
|
|
(60,153
|
)
|
|
(112,657
|
)
|
|
78,434
|
|
|
(191,091
|
)
|
||||||
Net investment income
|
65,857
|
|
|
57,291
|
|
|
8,566
|
|
|
132,585
|
|
|
108,942
|
|
|
23,643
|
|
||||||
Net realized and unrealized gains (losses)
|
241,542
|
|
|
(46,027
|
)
|
|
287,569
|
|
|
677,728
|
|
|
(172,323
|
)
|
|
850,051
|
|
||||||
Fees and commission income
|
4,645
|
|
|
4,487
|
|
|
158
|
|
|
9,477
|
|
|
9,385
|
|
|
92
|
|
||||||
Other income (expenses)
|
9,917
|
|
|
(9,334
|
)
|
|
19,251
|
|
|
15,421
|
|
|
(6,776
|
)
|
|
22,197
|
|
||||||
Corporate expenses
|
(18,734
|
)
|
|
(13,387
|
)
|
|
(5,347
|
)
|
|
(35,304
|
)
|
|
(22,020
|
)
|
|
(13,284
|
)
|
||||||
Interest expense
|
(15,619
|
)
|
|
(10,081
|
)
|
|
(5,538
|
)
|
|
(27,735
|
)
|
|
(18,611
|
)
|
|
(9,124
|
)
|
||||||
Net foreign exchange gains (losses)
|
3,752
|
|
|
6,958
|
|
|
(3,206
|
)
|
|
7,370
|
|
|
(219
|
)
|
|
7,589
|
|
||||||
EARNINGS (LOSS) BEFORE INCOME TAXES
|
269,358
|
|
|
28,058
|
|
|
241,300
|
|
|
666,885
|
|
|
(23,188
|
)
|
|
690,073
|
|
||||||
Income tax expense
|
(7,399
|
)
|
|
(1,219
|
)
|
|
(6,180
|
)
|
|
(10,119
|
)
|
|
(102
|
)
|
|
(10,017
|
)
|
||||||
Earnings from equity method investments
|
18,119
|
|
|
15,645
|
|
|
2,474
|
|
|
26,703
|
|
|
30,342
|
|
|
(3,639
|
)
|
||||||
NET EARNINGS
|
280,078
|
|
|
42,484
|
|
|
237,594
|
|
|
683,469
|
|
|
7,052
|
|
|
676,417
|
|
||||||
Net earnings attributable to noncontrolling interest
|
(2,266
|
)
|
|
(1,094
|
)
|
|
(1,172
|
)
|
|
(4,912
|
)
|
|
(2,523
|
)
|
|
(2,389
|
)
|
||||||
NET EARNINGS ATTRIBUTABLE TO ENSTAR GROUP LIMITED ORDINARY SHAREHOLDERS
|
$
|
277,812
|
|
|
$
|
41,390
|
|
|
$
|
236,422
|
|
|
$
|
678,557
|
|
|
$
|
4,529
|
|
|
$
|
674,028
|
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
||||||||||||||||
|
June 30,
|
|
|
|
June 30,
|
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Gross premiums written
|
$
|
(4,209
|
)
|
|
$
|
(938
|
)
|
|
$
|
(3,271
|
)
|
|
$
|
(25,086
|
)
|
|
$
|
6,442
|
|
|
$
|
(31,528
|
)
|
Ceded reinsurance premiums written
|
800
|
|
|
(723
|
)
|
|
1,523
|
|
|
2,499
|
|
|
(8,003
|
)
|
|
10,502
|
|
||||||
Net premiums written
|
$
|
(3,409
|
)
|
|
$
|
(1,661
|
)
|
|
$
|
(1,748
|
)
|
|
$
|
(22,587
|
)
|
|
$
|
(1,561
|
)
|
|
$
|
(21,026
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gross premiums earned
|
$
|
55,551
|
|
|
$
|
23,188
|
|
|
$
|
32,363
|
|
|
$
|
139,517
|
|
|
$
|
36,298
|
|
|
$
|
103,219
|
|
Ceded reinsurance premiums earned
|
(7,081
|
)
|
|
(13,579
|
)
|
|
6,498
|
|
|
(14,373
|
)
|
|
(19,511
|
)
|
|
5,138
|
|
||||||
Net premiums earned
|
$
|
48,470
|
|
|
$
|
9,609
|
|
|
$
|
38,861
|
|
|
$
|
125,144
|
|
|
$
|
16,787
|
|
|
$
|
108,357
|
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior
Periods |
|
Current
Period |
|
Total
|
|
Prior
Periods |
|
Current
Period |
|
Total
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Net losses paid
|
$
|
308,226
|
|
|
$
|
20,877
|
|
|
$
|
329,103
|
|
|
$
|
195,721
|
|
|
$
|
590
|
|
|
$
|
196,311
|
|
Net change in case and LAE reserves (1)
|
(121,377
|
)
|
|
1,543
|
|
|
(119,834
|
)
|
|
(125,416
|
)
|
|
1,052
|
|
|
(124,364
|
)
|
||||||
Net change in IBNR reserves (2)
|
(249,923
|
)
|
|
11,691
|
|
|
(238,232
|
)
|
|
(161,110
|
)
|
|
3,471
|
|
|
(157,639
|
)
|
||||||
Increase (reduction) in estimates of net ultimate losses
|
(63,074
|
)
|
|
34,111
|
|
|
(28,963
|
)
|
|
(90,805
|
)
|
|
5,113
|
|
|
(85,692
|
)
|
||||||
Increase (reduction) in provisions for unallocated LAE
|
(11,160
|
)
|
|
264
|
|
|
(10,896
|
)
|
|
(9,311
|
)
|
|
—
|
|
|
(9,311
|
)
|
||||||
Amortization of deferred charge assets
|
3,933
|
|
|
—
|
|
|
3,933
|
|
|
3,718
|
|
|
—
|
|
|
3,718
|
|
||||||
Amortization of fair value adjustments
|
7,716
|
|
|
—
|
|
|
7,716
|
|
|
3,918
|
|
|
—
|
|
|
3,918
|
|
||||||
Changes in fair value - fair value option
|
37,962
|
|
|
—
|
|
|
37,962
|
|
|
17,233
|
|
|
—
|
|
|
17,233
|
|
||||||
Net incurred losses and LAE
|
$
|
(24,623
|
)
|
|
$
|
34,375
|
|
|
$
|
9,752
|
|
|
$
|
(75,247
|
)
|
|
$
|
5,113
|
|
|
$
|
(70,134
|
)
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior
Periods |
|
Current
Period |
|
Total
|
|
Prior
Periods |
|
Current
Period |
|
Total
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Net losses paid
|
$
|
639,281
|
|
|
$
|
38,891
|
|
|
$
|
678,172
|
|
|
$
|
448,304
|
|
|
$
|
591
|
|
|
$
|
448,895
|
|
Net change in case and LAE reserves (1)
|
(218,950
|
)
|
|
21,415
|
|
|
(197,535
|
)
|
|
(248,908
|
)
|
|
1,058
|
|
|
(247,850
|
)
|
||||||
Net change in IBNR reserves (2)
|
(493,738
|
)
|
|
22,611
|
|
|
(471,127
|
)
|
|
(315,560
|
)
|
|
3,810
|
|
|
(311,750
|
)
|
||||||
Increase (reduction) in estimates of net ultimate losses
|
(73,407
|
)
|
|
82,917
|
|
|
9,510
|
|
|
(116,164
|
)
|
|
5,459
|
|
|
(110,705
|
)
|
||||||
Increase (reduction) in provisions for unallocated LAE
|
(26,600
|
)
|
|
529
|
|
|
(26,071
|
)
|
|
(24,263
|
)
|
|
—
|
|
|
(24,263
|
)
|
||||||
Amortization of deferred charge assets
|
10,997
|
|
|
—
|
|
|
10,997
|
|
|
8,799
|
|
|
—
|
|
|
8,799
|
|
||||||
Amortization of fair value adjustments
|
16,495
|
|
|
—
|
|
|
16,495
|
|
|
6,065
|
|
|
—
|
|
|
6,065
|
|
||||||
Changes in fair value - fair value option
|
94,003
|
|
|
—
|
|
|
94,003
|
|
|
(23,008
|
)
|
|
—
|
|
|
(23,008
|
)
|
||||||
Net incurred losses and LAE
|
$
|
21,488
|
|
|
$
|
83,446
|
|
|
$
|
104,934
|
|
|
$
|
(148,571
|
)
|
|
$
|
5,459
|
|
|
$
|
(143,112
|
)
|
|
Three Months Ended June 30,
|
|
|
|
Six Months Ended June 30,
|
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Operating expenses
|
$
|
44,208
|
|
|
$
|
38,378
|
|
|
$
|
5,830
|
|
|
$
|
88,200
|
|
|
$
|
76,781
|
|
|
$
|
11,419
|
|
Corporate expenses
|
18,734
|
|
|
13,387
|
|
|
5,347
|
|
|
35,304
|
|
|
22,020
|
|
|
13,284
|
|
||||||
General and administrative expenses
|
$
|
62,942
|
|
|
$
|
51,765
|
|
|
$
|
11,177
|
|
|
$
|
123,504
|
|
|
$
|
98,801
|
|
|
$
|
24,703
|
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
||||||||||||||||
|
June 30,
|
|
|
|
June 30,
|
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Gross premiums written
|
$
|
43,788
|
|
|
$
|
41,560
|
|
|
$
|
2,228
|
|
|
$
|
97,773
|
|
|
$
|
91,002
|
|
|
$
|
6,771
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net premiums written
|
$
|
36,962
|
|
|
$
|
34,583
|
|
|
$
|
2,379
|
|
|
$
|
83,461
|
|
|
$
|
76,077
|
|
|
$
|
7,384
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net premiums earned
|
$
|
38,199
|
|
|
$
|
34,522
|
|
|
$
|
3,677
|
|
|
$
|
76,952
|
|
|
$
|
69,745
|
|
|
$
|
7,207
|
|
Net incurred losses and LAE
|
(13,048
|
)
|
|
(16,926
|
)
|
|
3,878
|
|
|
(30,262
|
)
|
|
(34,098
|
)
|
|
3,836
|
|
||||||
Acquisition costs
|
(12,815
|
)
|
|
(12,716
|
)
|
|
(99
|
)
|
|
(26,557
|
)
|
|
(24,781
|
)
|
|
(1,776
|
)
|
||||||
Operating expenses
|
(3,193
|
)
|
|
(4,130
|
)
|
|
937
|
|
|
(6,226
|
)
|
|
(8,307
|
)
|
|
2,081
|
|
||||||
Underwriting income
|
9,143
|
|
|
750
|
|
|
8,393
|
|
|
13,907
|
|
|
2,559
|
|
|
11,348
|
|
||||||
Net investment income
|
2,053
|
|
|
1,285
|
|
|
768
|
|
|
3,764
|
|
|
2,470
|
|
|
1,294
|
|
||||||
Net realized and unrealized gains (losses)
|
1,969
|
|
|
(680
|
)
|
|
2,649
|
|
|
4,882
|
|
|
(2,083
|
)
|
|
6,965
|
|
||||||
Fees and commission income
|
1,533
|
|
|
3,865
|
|
|
(2,332
|
)
|
|
3,382
|
|
|
7,298
|
|
|
(3,916
|
)
|
||||||
Other income
|
35
|
|
|
56
|
|
|
(21
|
)
|
|
71
|
|
|
120
|
|
|
(49
|
)
|
||||||
Corporate expenses
|
(3,502
|
)
|
|
(1,838
|
)
|
|
(1,664
|
)
|
|
(7,290
|
)
|
|
(2,313
|
)
|
|
(4,977
|
)
|
||||||
Net foreign exchange gains (losses)
|
98
|
|
|
(47
|
)
|
|
145
|
|
|
923
|
|
|
(1,000
|
)
|
|
1,923
|
|
||||||
EARNINGS BEFORE INCOME TAXES
|
11,329
|
|
|
3,391
|
|
|
7,938
|
|
|
19,639
|
|
|
7,051
|
|
|
12,588
|
|
||||||
Income tax expense
|
(1,023
|
)
|
|
(739
|
)
|
|
(284
|
)
|
|
(1,708
|
)
|
|
(1,019
|
)
|
|
(689
|
)
|
||||||
NET EARNINGS
|
10,306
|
|
|
2,652
|
|
|
7,654
|
|
|
17,931
|
|
|
6,032
|
|
|
11,899
|
|
||||||
Net earnings attributable to noncontrolling interest
|
(4,227
|
)
|
|
(1,121
|
)
|
|
(3,106
|
)
|
|
(7,355
|
)
|
|
(2,532
|
)
|
|
(4,823
|
)
|
||||||
NET EARNINGS ATTRIBUTABLE TO ENSTAR GROUP LIMITED ORDINARY SHAREHOLDERS
|
$
|
6,079
|
|
|
$
|
1,531
|
|
|
$
|
4,548
|
|
|
$
|
10,576
|
|
|
$
|
3,500
|
|
|
$
|
7,076
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Underwriting ratios(1):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loss ratio
|
34.2
|
%
|
|
49.0
|
%
|
|
(14.8
|
)%
|
|
39.3
|
%
|
|
48.9
|
%
|
|
(9.6
|
)%
|
||||||
Acquisition cost ratio
|
33.5
|
%
|
|
36.8
|
%
|
|
(3.3
|
)%
|
|
34.5
|
%
|
|
35.5
|
%
|
|
(1.0
|
)%
|
||||||
Operating expense ratio
|
8.4
|
%
|
|
12.0
|
%
|
|
(3.6
|
)%
|
|
8.1
|
%
|
|
11.9
|
%
|
|
(3.8
|
)%
|
||||||
Combined ratio
|
76.1
|
%
|
|
97.8
|
%
|
|
(21.7
|
)%
|
|
81.9
|
%
|
|
96.3
|
%
|
|
(14.4
|
)%
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
||||||||||||||||
|
June 30,
|
|
|
|
June 30,
|
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Marine, Aviation and Transit
|
$
|
10,656
|
|
|
$
|
9,740
|
|
|
$
|
916
|
|
|
$
|
23,670
|
|
|
$
|
22,127
|
|
|
$
|
1,543
|
|
Binding Authorities
|
17,073
|
|
|
17,639
|
|
|
(566
|
)
|
|
35,648
|
|
|
35,348
|
|
|
300
|
|
||||||
Reinsurance
|
3,429
|
|
|
3,843
|
|
|
(414
|
)
|
|
11,904
|
|
|
12,775
|
|
|
(871
|
)
|
||||||
Accident and Health
|
4,537
|
|
|
5,378
|
|
|
(841
|
)
|
|
13,749
|
|
|
11,518
|
|
|
2,231
|
|
||||||
Non-Marine Direct and Facultative
|
8,093
|
|
|
4,960
|
|
|
3,133
|
|
|
12,802
|
|
|
9,234
|
|
|
3,568
|
|
||||||
Total
|
$
|
43,788
|
|
|
$
|
41,560
|
|
|
$
|
2,228
|
|
|
$
|
97,773
|
|
|
$
|
91,002
|
|
|
$
|
6,771
|
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
||||||||||||||||
|
June 30,
|
|
|
|
June 30,
|
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Marine, Aviation and Transit
|
$
|
7,379
|
|
|
$
|
7,466
|
|
|
$
|
(87
|
)
|
|
$
|
15,778
|
|
|
$
|
15,060
|
|
|
$
|
718
|
|
Binding Authorities
|
16,225
|
|
|
15,760
|
|
|
465
|
|
|
35,420
|
|
|
32,381
|
|
|
3,039
|
|
||||||
Reinsurance
|
3,598
|
|
|
2,502
|
|
|
1,096
|
|
|
6,662
|
|
|
5,800
|
|
|
862
|
|
||||||
Accident and Health
|
6,005
|
|
|
5,417
|
|
|
588
|
|
|
9,924
|
|
|
9,824
|
|
|
100
|
|
||||||
Non-Marine Direct and Facultative
|
4,992
|
|
|
3,377
|
|
|
1,615
|
|
|
9,168
|
|
|
6,680
|
|
|
2,488
|
|
||||||
Total
|
$
|
38,199
|
|
|
$
|
34,522
|
|
|
$
|
3,677
|
|
|
$
|
76,952
|
|
|
$
|
69,745
|
|
|
$
|
7,207
|
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior
Periods |
|
Current
Period |
|
Total
|
|
Prior
Periods |
|
Current
Period |
|
Total
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Net losses paid
|
$
|
10,526
|
|
|
$
|
7,251
|
|
|
$
|
17,777
|
|
|
$
|
8,882
|
|
|
$
|
10,465
|
|
|
$
|
19,347
|
|
Net change in case and LAE reserves (1)
|
(3,830
|
)
|
|
4,089
|
|
|
259
|
|
|
(3,169
|
)
|
|
(273
|
)
|
|
(3,442
|
)
|
||||||
Net change in IBNR reserves (2)
|
(11,320
|
)
|
|
6,519
|
|
|
(4,801
|
)
|
|
(7,128
|
)
|
|
8,983
|
|
|
1,855
|
|
||||||
Increase (reduction) in estimates of net ultimate losses
|
(4,624
|
)
|
|
17,859
|
|
|
13,235
|
|
|
(1,415
|
)
|
|
19,175
|
|
|
17,760
|
|
||||||
Increase in provisions for unallocated LAE
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||||
Amortization of fair value adjustments
|
(187
|
)
|
|
—
|
|
|
(187
|
)
|
|
(836
|
)
|
|
—
|
|
|
(836
|
)
|
||||||
Net incurred losses and LAE
|
$
|
(4,811
|
)
|
|
$
|
17,859
|
|
|
$
|
13,048
|
|
|
$
|
(2,249
|
)
|
|
$
|
19,175
|
|
|
$
|
16,926
|
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior
Periods |
|
Current
Period |
|
Total
|
|
Prior
Periods |
|
Current
Period |
|
Total
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Net losses paid
|
$
|
24,946
|
|
|
$
|
15,144
|
|
|
$
|
40,090
|
|
|
$
|
19,258
|
|
|
$
|
17,619
|
|
|
$
|
36,877
|
|
Net change in case and LAE reserves (1)
|
(10,172
|
)
|
|
10,018
|
|
|
(154
|
)
|
|
(5,553
|
)
|
|
6,001
|
|
|
448
|
|
||||||
Net change in IBNR reserves (2)
|
(21,552
|
)
|
|
10,934
|
|
|
(10,618
|
)
|
|
(12,715
|
)
|
|
12,861
|
|
|
146
|
|
||||||
Increase in estimates of net ultimate losses
|
(6,778
|
)
|
|
36,096
|
|
|
29,318
|
|
|
990
|
|
|
36,481
|
|
|
37,471
|
|
||||||
Increase in provisions for unallocated LAE
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||||
Amortization of fair value adjustments
|
944
|
|
|
—
|
|
|
944
|
|
|
(3,375
|
)
|
|
—
|
|
|
(3,375
|
)
|
||||||
Net incurred losses and LAE
|
$
|
(5,834
|
)
|
|
$
|
36,096
|
|
|
$
|
30,262
|
|
|
$
|
(2,383
|
)
|
|
$
|
36,481
|
|
|
$
|
34,098
|
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
StarStone Group
|
|
StarStone Intra-Group Cessions
|
|
StarStone Segment
|
|
StarStone Group
|
|
StarStone Intra-Group Cessions
|
|
StarStone Segment
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Net premiums earned
|
$
|
162,957
|
|
|
$
|
20,966
|
|
|
$
|
183,923
|
|
|
$
|
128,110
|
|
|
$
|
55,511
|
|
|
$
|
183,621
|
|
Net incurred losses and LAE
|
(119,700
|
)
|
|
(69,373
|
)
|
|
(189,073
|
)
|
|
(105,286
|
)
|
|
(40,741
|
)
|
|
(146,027
|
)
|
||||||
Acquisition costs
|
(28,261
|
)
|
|
(9,122
|
)
|
|
(37,383
|
)
|
|
(17,432
|
)
|
|
(19,839
|
)
|
|
(37,271
|
)
|
||||||
Operating expenses
|
(33,286
|
)
|
|
(66
|
)
|
|
(33,352
|
)
|
|
(33,052
|
)
|
|
(1,090
|
)
|
|
(34,142
|
)
|
||||||
Underwriting loss
|
(18,290
|
)
|
|
(57,595
|
)
|
|
(75,885
|
)
|
|
(27,660
|
)
|
|
(6,159
|
)
|
|
(33,819
|
)
|
||||||
Net investment income
|
12,268
|
|
|
—
|
|
|
12,268
|
|
|
8,745
|
|
|
—
|
|
|
8,745
|
|
||||||
Net realized and unrealized gains (losses)
|
19,518
|
|
|
2,137
|
|
|
21,655
|
|
|
(3,181
|
)
|
|
—
|
|
|
(3,181
|
)
|
||||||
Other income (expense)
|
319
|
|
|
—
|
|
|
319
|
|
|
(600
|
)
|
|
—
|
|
|
(600
|
)
|
||||||
Interest income (expenses)
|
(2,567
|
)
|
|
2,567
|
|
|
—
|
|
|
(478
|
)
|
|
472
|
|
|
(6
|
)
|
||||||
Net foreign exchange (loss) gain
|
(1,632
|
)
|
|
396
|
|
|
(1,236
|
)
|
|
(838
|
)
|
|
(735
|
)
|
|
(1,573
|
)
|
||||||
EARNINGS (LOSS) BEFORE INCOME TAXES
|
9,616
|
|
|
(52,495
|
)
|
|
(42,879
|
)
|
|
(24,012
|
)
|
|
(6,422
|
)
|
|
(30,434
|
)
|
||||||
Income tax benefit (expense)
|
904
|
|
|
—
|
|
|
904
|
|
|
(1,688
|
)
|
|
—
|
|
|
(1,688
|
)
|
||||||
Loss from equity method investments
|
(406
|
)
|
|
—
|
|
|
(406
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
NET EARNINGS (LOSS)
|
10,114
|
|
|
(52,495
|
)
|
|
(42,381
|
)
|
|
(25,700
|
)
|
|
(6,422
|
)
|
|
(32,122
|
)
|
||||||
Net loss (earnings) attributable to noncontrolling interest
|
(4,157
|
)
|
|
13,363
|
|
|
9,206
|
|
|
10,604
|
|
|
—
|
|
|
10,604
|
|
||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR GROUP LIMITED ORDINARY SHAREHOLDERS
|
$
|
5,957
|
|
|
$
|
(39,132
|
)
|
|
$
|
(33,175
|
)
|
|
$
|
(15,096
|
)
|
|
$
|
(6,422
|
)
|
|
$
|
(21,518
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Underwriting ratios(1):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loss ratio
|
73.5
|
%
|
|
330.9
|
%
|
|
102.8
|
%
|
|
82.2
|
%
|
|
73.4
|
%
|
|
79.5
|
%
|
||||||
Acquisition cost ratio
|
17.3
|
%
|
|
43.5
|
%
|
|
20.3
|
%
|
|
13.6
|
%
|
|
35.7
|
%
|
|
20.3
|
%
|
||||||
Operating expense ratio
|
20.4
|
%
|
|
0.3
|
%
|
|
18.2
|
%
|
|
25.8
|
%
|
|
2.0
|
%
|
|
18.6
|
%
|
||||||
Combined ratio
|
111.2
|
%
|
|
374.7
|
%
|
|
141.3
|
%
|
|
121.6
|
%
|
|
111.1
|
%
|
|
118.4
|
%
|
(1)
|
Refer to "Underwriting Ratios" for a description of how these ratios are calculated.
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Core Lines
|
|
Exited Lines
|
|
StarStone Group
|
|
Core Lines
|
|
Exited Lines
|
|
StarStone Group
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Net premiums earned
|
$
|
141,935
|
|
|
$
|
21,022
|
|
|
$
|
162,957
|
|
|
$
|
104,363
|
|
|
$
|
23,747
|
|
|
$
|
128,110
|
|
Net incurred losses and LAE
|
(98,151
|
)
|
|
(21,549
|
)
|
|
(119,700
|
)
|
|
(68,265
|
)
|
|
(37,021
|
)
|
|
(105,286
|
)
|
||||||
Acquisition costs
|
(21,150
|
)
|
|
(7,111
|
)
|
|
(28,261
|
)
|
|
(16,402
|
)
|
|
(1,030
|
)
|
|
(17,432
|
)
|
||||||
Operating expenses
|
(23,199
|
)
|
|
(10,087
|
)
|
|
(33,286
|
)
|
|
(27,167
|
)
|
|
(5,885
|
)
|
|
(33,052
|
)
|
||||||
Underwriting income (loss)
|
$
|
(565
|
)
|
|
$
|
(17,725
|
)
|
|
$
|
(18,290
|
)
|
|
$
|
(7,471
|
)
|
|
$
|
(20,189
|
)
|
|
$
|
(27,660
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Underwriting ratios(1):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loss ratio
|
69.2
|
%
|
|
102.5
|
%
|
|
73.5
|
%
|
|
65.4
|
%
|
|
155.9
|
%
|
|
82.2
|
%
|
||||||
Acquisition cost ratio
|
14.9
|
%
|
|
33.8
|
%
|
|
17.3
|
%
|
|
15.7
|
%
|
|
4.3
|
%
|
|
13.6
|
%
|
||||||
Operating expense ratio
|
16.3
|
%
|
|
48.0
|
%
|
|
20.4
|
%
|
|
26.1
|
%
|
|
24.8
|
%
|
|
25.8
|
%
|
||||||
Combined ratio
|
100.4
|
%
|
|
184.3
|
%
|
|
111.2
|
%
|
|
107.2
|
%
|
|
185.0
|
%
|
|
121.6
|
%
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
StarStone Group
|
|
StarStone Intra-Group Cessions
|
|
StarStone Segment
|
|
StarStone Group
|
|
StarStone Intra-Group Cessions
|
|
StarStone Segment
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Net premiums earned
|
$
|
338,339
|
|
|
$
|
58,846
|
|
|
$
|
397,185
|
|
|
$
|
254,936
|
|
|
$
|
55,511
|
|
|
$
|
310,447
|
|
Net incurred losses and LAE
|
(264,464
|
)
|
|
(119,661
|
)
|
|
(384,125
|
)
|
|
(180,626
|
)
|
|
(40,741
|
)
|
|
(221,367
|
)
|
||||||
Acquisition costs
|
(62,809
|
)
|
|
(26,233
|
)
|
|
(89,042
|
)
|
|
(33,857
|
)
|
|
(19,839
|
)
|
|
(53,696
|
)
|
||||||
Operating expenses
|
(68,903
|
)
|
|
(443
|
)
|
|
(69,346
|
)
|
|
(67,609
|
)
|
|
(1,090
|
)
|
|
(68,699
|
)
|
||||||
Underwriting income (loss)
|
(57,837
|
)
|
|
(87,491
|
)
|
|
(145,328
|
)
|
|
(27,156
|
)
|
|
(6,159
|
)
|
|
(33,315
|
)
|
||||||
Net investment income
|
24,121
|
|
|
89
|
|
|
24,210
|
|
|
16,446
|
|
|
—
|
|
|
16,446
|
|
||||||
Net realized and unrealized gains (losses)
|
38,228
|
|
|
4,085
|
|
|
42,313
|
|
|
(16,139
|
)
|
|
—
|
|
|
(16,139
|
)
|
||||||
Other income (expenses)
|
379
|
|
|
—
|
|
|
379
|
|
|
(549
|
)
|
|
—
|
|
|
(549
|
)
|
||||||
Interest income (expenses)
|
(5,359
|
)
|
|
4,884
|
|
|
(475
|
)
|
|
(1,019
|
)
|
|
472
|
|
|
(547
|
)
|
||||||
Net foreign exchange (loss) gain
|
(1,874
|
)
|
|
44
|
|
|
(1,830
|
)
|
|
257
|
|
|
(735
|
)
|
|
(478
|
)
|
||||||
EARNINGS (LOSS) BEFORE INCOME TAXES
|
(2,342
|
)
|
|
(78,389
|
)
|
|
(80,731
|
)
|
|
(28,160
|
)
|
|
(6,422
|
)
|
|
(34,582
|
)
|
||||||
Income tax benefit (expense)
|
(355
|
)
|
|
—
|
|
|
(355
|
)
|
|
(2,686
|
)
|
|
—
|
|
|
(2,686
|
)
|
||||||
Loss from equity method investments
|
(218
|
)
|
|
—
|
|
|
(218
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
NET EARNINGS (LOSS)
|
(2,915
|
)
|
|
(78,389
|
)
|
|
(81,304
|
)
|
|
(30,846
|
)
|
|
(6,422
|
)
|
|
(37,268
|
)
|
||||||
Net loss (earnings) attributable to noncontrolling interest
|
1,189
|
|
|
15,939
|
|
|
17,128
|
|
|
12,662
|
|
|
—
|
|
|
12,662
|
|
||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR GROUP LIMITED ORDINARY SHAREHOLDERS
|
$
|
(1,726
|
)
|
|
$
|
(62,450
|
)
|
|
$
|
(64,176
|
)
|
|
$
|
(18,184
|
)
|
|
$
|
(6,422
|
)
|
|
$
|
(24,606
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Underwriting ratios(1):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loss ratio
|
78.2
|
%
|
|
203.3
|
%
|
|
96.7
|
%
|
|
70.9
|
%
|
|
73.4
|
%
|
|
71.3
|
%
|
||||||
Acquisition cost ratio
|
18.6
|
%
|
|
44.6
|
%
|
|
22.4
|
%
|
|
13.3
|
%
|
|
35.7
|
%
|
|
17.3
|
%
|
||||||
Operating expense ratio
|
20.3
|
%
|
|
0.8
|
%
|
|
17.5
|
%
|
|
26.5
|
%
|
|
2.0
|
%
|
|
22.1
|
%
|
||||||
Combined ratio
|
117.1
|
%
|
|
248.7
|
%
|
|
136.6
|
%
|
|
110.7
|
%
|
|
111.1
|
%
|
|
110.7
|
%
|
(1)
|
Refer to "Underwriting Ratios" for a description of how these ratios are calculated.
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Core Lines
|
|
Exited Lines
|
|
StarStone Group
|
|
Core Lines
|
|
Exited Lines
|
|
StarStone Group
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Net premiums earned
|
$
|
286,024
|
|
|
$
|
52,315
|
|
|
$
|
338,339
|
|
|
$
|
199,049
|
|
|
$
|
55,887
|
|
|
$
|
254,936
|
|
Net incurred losses and LAE
|
(197,521
|
)
|
|
(66,943
|
)
|
|
(264,464
|
)
|
|
(119,546
|
)
|
|
(61,080
|
)
|
|
(180,626
|
)
|
||||||
Acquisition costs
|
(50,188
|
)
|
|
(12,621
|
)
|
|
(62,809
|
)
|
|
(28,638
|
)
|
|
(5,219
|
)
|
|
(33,857
|
)
|
||||||
Operating expenses
|
(54,892
|
)
|
|
(14,011
|
)
|
|
(68,903
|
)
|
|
(53,997
|
)
|
|
(13,612
|
)
|
|
(67,609
|
)
|
||||||
Underwriting income (loss)
|
$
|
(16,577
|
)
|
|
$
|
(41,260
|
)
|
|
$
|
(57,837
|
)
|
|
$
|
(3,132
|
)
|
|
$
|
(24,024
|
)
|
|
$
|
(27,156
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Underwriting ratios(1):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loss ratio
|
69.1
|
%
|
|
128.0
|
%
|
|
78.2
|
%
|
|
60.1
|
%
|
|
109.3
|
%
|
|
70.9
|
%
|
||||||
Acquisition cost ratio
|
17.5
|
%
|
|
24.1
|
%
|
|
18.6
|
%
|
|
14.4
|
%
|
|
9.3
|
%
|
|
13.3
|
%
|
||||||
Operating expense ratio
|
19.2
|
%
|
|
26.8
|
%
|
|
20.3
|
%
|
|
27.1
|
%
|
|
24.4
|
%
|
|
26.5
|
%
|
||||||
Combined ratio
|
105.8
|
%
|
|
178.9
|
%
|
|
117.1
|
%
|
|
101.6
|
%
|
|
143.0
|
%
|
|
110.7
|
%
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
||||||||||||||||
|
June 30,
|
|
|
|
June 30,
|
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Casualty
|
$
|
94,483
|
|
|
$
|
93,554
|
|
|
$
|
929
|
|
|
$
|
189,888
|
|
|
$
|
168,423
|
|
|
$
|
21,465
|
|
Marine
|
54,637
|
|
|
73,381
|
|
|
(18,744
|
)
|
|
143,178
|
|
|
174,307
|
|
|
(31,129
|
)
|
||||||
Property
|
35,168
|
|
|
78,994
|
|
|
(43,826
|
)
|
|
63,321
|
|
|
161,236
|
|
|
(97,915
|
)
|
||||||
Aerospace
|
20,415
|
|
|
17,881
|
|
|
2,534
|
|
|
29,527
|
|
|
27,889
|
|
|
1,638
|
|
||||||
Workers' Compensation
|
29,401
|
|
|
37,543
|
|
|
(8,142
|
)
|
|
59,563
|
|
|
74,487
|
|
|
(14,924
|
)
|
||||||
Total
|
$
|
234,104
|
|
|
$
|
301,353
|
|
|
$
|
(67,249
|
)
|
|
$
|
485,477
|
|
|
$
|
606,342
|
|
|
$
|
(120,865
|
)
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
||||||||||||||||
|
June 30,
|
|
|
|
June 30,
|
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
(in thousands of U.S. dollars)
|
|
|
|
|
|
|
||||||||||||||||
Casualty
|
$
|
75,064
|
|
|
$
|
69,857
|
|
|
$
|
5,207
|
|
|
$
|
156,781
|
|
|
$
|
109,624
|
|
|
$
|
47,157
|
|
Marine
|
54,666
|
|
|
48,534
|
|
|
6,132
|
|
|
111,419
|
|
|
87,758
|
|
|
23,661
|
|
||||||
Property
|
24,899
|
|
|
40,892
|
|
|
(15,993
|
)
|
|
69,238
|
|
|
65,084
|
|
|
4,154
|
|
||||||
Aerospace
|
11,816
|
|
|
13,082
|
|
|
(1,266
|
)
|
|
25,336
|
|
|
24,690
|
|
|
646
|
|
||||||
Workers' Compensation
|
17,478
|
|
|
11,256
|
|
|
6,222
|
|
|
34,411
|
|
|
23,291
|
|
|
11,120
|
|
||||||
Total
|
$
|
183,923
|
|
|
$
|
183,621
|
|
|
$
|
302
|
|
|
$
|
397,185
|
|
|
$
|
310,447
|
|
|
$
|
86,738
|
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior
Periods |
|
Current
Period |
|
Total
|
|
Prior
Periods |
|
Current
Period |
|
Total
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Net losses paid
|
$
|
108,362
|
|
|
$
|
16,903
|
|
|
$
|
125,265
|
|
|
$
|
85,888
|
|
|
$
|
19,419
|
|
|
$
|
105,307
|
|
Net change in case and LAE reserves (1)
|
3,574
|
|
|
43,439
|
|
|
47,013
|
|
|
(21,405
|
)
|
|
47,246
|
|
|
25,841
|
|
||||||
Net change in IBNR reserves (2)
|
(68,571
|
)
|
|
83,916
|
|
|
15,345
|
|
|
(46,738
|
)
|
|
59,480
|
|
|
12,742
|
|
||||||
Increase in estimates of net ultimate losses
|
43,365
|
|
|
144,258
|
|
|
187,623
|
|
|
17,745
|
|
|
126,145
|
|
|
143,890
|
|
||||||
Increase (reduction) in provisions for unallocated LAE
|
(603
|
)
|
|
2,091
|
|
|
1,488
|
|
|
(1,189
|
)
|
|
3,427
|
|
|
2,238
|
|
||||||
Amortization of fair value adjustments
|
(38
|
)
|
|
—
|
|
|
(38
|
)
|
|
(101
|
)
|
|
—
|
|
|
(101
|
)
|
||||||
Net incurred losses and LAE
|
$
|
42,724
|
|
|
$
|
146,349
|
|
|
$
|
189,073
|
|
|
$
|
16,455
|
|
|
$
|
129,572
|
|
|
$
|
146,027
|
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Prior
Periods |
|
Current
Period |
|
Total
|
|
Prior
Periods |
|
Current
Period |
|
Total
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Net losses paid
|
$
|
221,987
|
|
|
$
|
18,695
|
|
|
$
|
240,682
|
|
|
$
|
173,575
|
|
|
$
|
20,367
|
|
|
$
|
193,942
|
|
Net change in case and LAE reserves (1)
|
(5,250
|
)
|
|
54,319
|
|
|
49,069
|
|
|
(35,622
|
)
|
|
56,988
|
|
|
21,366
|
|
||||||
Net change in IBNR reserves (2)
|
(121,405
|
)
|
|
213,174
|
|
|
91,769
|
|
|
(120,128
|
)
|
|
123,999
|
|
|
3,871
|
|
||||||
Increase in estimates of net ultimate losses
|
95,332
|
|
|
286,188
|
|
|
381,520
|
|
|
17,825
|
|
|
201,354
|
|
|
219,179
|
|
||||||
Increase (reduction) in provisions for unallocated LAE
|
(2,275
|
)
|
|
5,111
|
|
|
2,836
|
|
|
(3,290
|
)
|
|
5,720
|
|
|
2,430
|
|
||||||
Amortization of fair value adjustments
|
(231
|
)
|
|
—
|
|
|
(231
|
)
|
|
(242
|
)
|
|
—
|
|
|
(242
|
)
|
||||||
Net incurred losses and LAE
|
$
|
92,826
|
|
|
$
|
291,299
|
|
|
$
|
384,125
|
|
|
$
|
14,293
|
|
|
$
|
207,074
|
|
|
$
|
221,367
|
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
||||||||||||||||
|
June 30,
|
|
|
|
June 30,
|
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
(in thousands of U.S. dollars)
|
||||||||||||||||||||||
Net premiums earned
|
$
|
5,971
|
|
|
$
|
1,060
|
|
|
$
|
4,911
|
|
|
$
|
12,569
|
|
|
$
|
2,052
|
|
|
$
|
10,517
|
|
Net incurred losses and LAE
|
(4,465
|
)
|
|
—
|
|
|
(4,465
|
)
|
|
(9,421
|
)
|
|
—
|
|
|
(9,421
|
)
|
||||||
Life and Annuity Policy Benefits
|
(2,194
|
)
|
|
160
|
|
|
(2,354
|
)
|
|
(2,290
|
)
|
|
206
|
|
|
(2,496
|
)
|
||||||
Acquisition costs
|
(145
|
)
|
|
(133
|
)
|
|
(12
|
)
|
|
(377
|
)
|
|
(281
|
)
|
|
(96
|
)
|
||||||
Underwriting income (loss)
|
(833
|
)
|
|
1,087
|
|
|
(1,920
|
)
|
|
481
|
|
|
1,977
|
|
|
(1,496
|
)
|
||||||
Net investment income
|
(2,446
|
)
|
|
(852
|
)
|
|
(1,594
|
)
|
|
(4,131
|
)
|
|
4,930
|
|
|
(9,061
|
)
|
||||||
Net realized and unrealized gains (losses)
|
4,545
|
|
|
(4,530
|
)
|
|
9,075
|
|
|
5,579
|
|
|
(6,903
|
)
|
|
12,482
|
|
||||||
Other income (expenses)
|
759
|
|
|
527
|
|
|
232
|
|
|
971
|
|
|
(203
|
)
|
|
1,174
|
|
||||||
Corporate expenses
|
(14,530
|
)
|
|
(10,737
|
)
|
|
(3,793
|
)
|
|
(23,227
|
)
|
|
(19,752
|
)
|
|
(3,475
|
)
|
||||||
Interest Income
|
2,583
|
|
|
1,165
|
|
|
1,418
|
|
|
4,138
|
|
|
2,225
|
|
|
1,913
|
|
||||||
Net foreign exchange gains (losses)
|
(27
|
)
|
|
181
|
|
|
(208
|
)
|
|
(26
|
)
|
|
1,348
|
|
|
(1,374
|
)
|
||||||
LOSS BEFORE INCOME TAXES
|
(9,949
|
)
|
|
(13,159
|
)
|
|
3,210
|
|
|
(16,215
|
)
|
|
(16,378
|
)
|
|
163
|
|
||||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(85
|
)
|
|
(11
|
)
|
|
(74
|
)
|
||||||
NET LOSS ATTRIBUTABLE TO ENSTAR GROUP LIMITED
|
(9,949
|
)
|
|
(13,159
|
)
|
|
3,210
|
|
|
(16,300
|
)
|
|
(16,389
|
)
|
|
89
|
|
||||||
Dividends on preferred shares
|
(8,925
|
)
|
|
—
|
|
|
(8,925
|
)
|
|
(18,064
|
)
|
|
—
|
|
|
(18,064
|
)
|
||||||
NET LOSS ATTRIBUTABLE TO ENSTAR GROUP LIMITED ORDINARY SHAREHOLDERS
|
$
|
(18,874
|
)
|
|
$
|
(13,159
|
)
|
|
$
|
(5,715
|
)
|
|
$
|
(34,364
|
)
|
|
$
|
(16,389
|
)
|
|
$
|
(17,975
|
)
|
|
|
June 30, 2019
|
||||||||||||||||||
|
|
Non-life
Run-off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
|
|
(in thousands of U.S. dollars)
|
||||||||||||||||||
Short-term investments, trading, at fair value
|
|
$
|
34,892
|
|
|
$
|
134
|
|
|
$
|
11,511
|
|
|
$
|
—
|
|
|
$
|
46,537
|
|
Fixed maturities, trading, at fair value
|
|
6,165,735
|
|
|
137,137
|
|
|
1,332,274
|
|
|
—
|
|
|
7,635,146
|
|
|||||
Fixed maturities, available-for-sale, at fair value
|
|
39,545
|
|
|
23,237
|
|
|
—
|
|
|
—
|
|
|
62,782
|
|
|||||
Funds held - directly managed
|
|
1,232,775
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,232,775
|
|
|||||
Equities, at fair value
|
|
474,815
|
|
|
3,787
|
|
|
43,436
|
|
|
—
|
|
|
522,038
|
|
|||||
Other investments, at fair value
|
|
2,286,846
|
|
|
8,072
|
|
|
118,566
|
|
|
6,028
|
|
|
2,419,512
|
|
|||||
Equity method investments
|
|
267,278
|
|
|
—
|
|
|
3,000
|
|
|
—
|
|
|
270,278
|
|
|||||
Total investments
|
|
10,501,886
|
|
|
172,367
|
|
|
1,508,787
|
|
|
6,028
|
|
|
12,189,068
|
|
|||||
Cash and cash equivalents (including restricted cash)
|
|
1,158,446
|
|
|
56,381
|
|
|
304,562
|
|
|
4,396
|
|
|
1,523,785
|
|
|||||
Funds held by reinsured companies
|
|
320,015
|
|
|
28,007
|
|
|
32,072
|
|
|
9,413
|
|
|
389,507
|
|
|||||
Total investable assets
|
|
$
|
11,980,347
|
|
|
$
|
256,755
|
|
|
$
|
1,845,421
|
|
|
$
|
19,837
|
|
|
$
|
14,102,360
|
|
Duration (in years) (1)
|
|
5.17
|
|
|
1.83
|
|
|
2.51
|
|
|
0.00
|
|
|
4.68
|
|
|||||
Average credit rating (2)
|
|
A+
|
|
|
AA-
|
|
|
A+
|
|
|
AAA
|
|
|
A+
|
|
|
|
December 31, 2018
|
||||||||||||||||||
|
|
Non-life
Run-off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
|
|
(in thousands of U.S. dollars)
|
||||||||||||||||||
Short-term investments, trading, at fair value
|
|
$
|
106,375
|
|
|
$
|
541
|
|
|
$
|
7,200
|
|
|
$
|
—
|
|
|
$
|
114,116
|
|
Fixed maturities, trading, at fair value
|
|
5,790,219
|
|
|
139,121
|
|
|
1,319,453
|
|
|
—
|
|
|
7,248,793
|
|
|||||
Fixed maturities, available-for-sale, at fair value
|
|
—
|
|
|
29,975
|
|
|
—
|
|
|
121,634
|
|
|
151,609
|
|
|||||
Funds held - directly managed
|
|
1,198,154
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,198,154
|
|
|||||
Equities, at fair value
|
|
335,632
|
|
|
3,193
|
|
|
28,300
|
|
|
—
|
|
|
367,125
|
|
|||||
Other investments, at fair value
|
|
1,825,307
|
|
|
7,166
|
|
|
113,024
|
|
|
12,260
|
|
|
1,957,757
|
|
|||||
Equity method investments
|
|
204,507
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
204,507
|
|
|||||
Total investments
|
|
9,460,194
|
|
|
179,996
|
|
|
1,467,977
|
|
|
133,894
|
|
|
11,242,061
|
|
|||||
Cash and cash equivalents (including restricted cash)
|
|
585,956
|
|
|
54,679
|
|
|
318,811
|
|
|
23,138
|
|
|
982,584
|
|
|||||
Funds held by reinsured companies
|
|
263,713
|
|
|
26,489
|
|
|
20,823
|
|
|
10,242
|
|
|
321,267
|
|
|||||
Total investable assets
|
|
$
|
10,309,863
|
|
|
$
|
261,164
|
|
|
$
|
1,807,611
|
|
|
$
|
167,274
|
|
|
$
|
12,545,912
|
|
Duration (in years) (1)
|
|
5.41
|
|
|
1.70
|
|
|
2.66
|
|
|
5.70
|
|
|
4.86
|
|
|||||
Average credit rating (2)
|
|
A+
|
|
|
AA-
|
|
|
A+
|
|
|
AA-
|
|
|
A+
|
|
|
|
June 30, 2019
|
||||||||||||||
|
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
Non-OTTI
|
|
Fair
Value
|
||||||||
U.S. government and agency
|
|
$
|
503,213
|
|
|
$
|
8,701
|
|
|
$
|
(371
|
)
|
|
$
|
511,543
|
|
U.K. government
|
|
334,635
|
|
|
16,068
|
|
|
(895
|
)
|
|
349,808
|
|
||||
Other government
|
|
684,461
|
|
|
22,126
|
|
|
(7,835
|
)
|
|
698,752
|
|
||||
Corporate
|
|
5,010,376
|
|
|
163,989
|
|
|
(33,504
|
)
|
|
5,140,861
|
|
||||
Municipal
|
|
152,071
|
|
|
9,374
|
|
|
(16
|
)
|
|
161,429
|
|
||||
Residential mortgage-backed
|
|
408,353
|
|
|
8,609
|
|
|
(655
|
)
|
|
416,307
|
|
||||
Commercial mortgage-backed
|
|
919,921
|
|
|
24,044
|
|
|
(3,549
|
)
|
|
940,416
|
|
||||
Asset-backed
|
|
733,390
|
|
|
3,665
|
|
|
(3,702
|
)
|
|
733,353
|
|
||||
|
|
$
|
8,746,420
|
|
|
$
|
256,576
|
|
|
$
|
(50,527
|
)
|
|
$
|
8,952,469
|
|
|
|
December 31, 2018
|
||||||||||||||
|
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
Non-OTTI
|
|
Fair
Value
|
||||||||
U.S. government and agency
|
|
$
|
512,360
|
|
|
$
|
1,904
|
|
|
$
|
(4,019
|
)
|
|
$
|
510,245
|
|
U.K. government
|
|
301,749
|
|
|
6,526
|
|
|
(7,644
|
)
|
|
300,631
|
|
||||
Other government
|
|
814,614
|
|
|
5,261
|
|
|
(26,065
|
)
|
|
793,810
|
|
||||
Corporate
|
|
5,019,018
|
|
|
12,195
|
|
|
(191,373
|
)
|
|
4,839,840
|
|
||||
Municipal
|
|
132,928
|
|
|
494
|
|
|
(3,157
|
)
|
|
130,265
|
|
||||
Residential mortgage-backed
|
|
772,457
|
|
|
5,846
|
|
|
(4,746
|
)
|
|
773,557
|
|
||||
Commercial mortgage-backed
|
|
729,232
|
|
|
2,613
|
|
|
(18,782
|
)
|
|
713,063
|
|
||||
Asset-backed
|
|
642,618
|
|
|
1,032
|
|
|
(7,169
|
)
|
|
636,481
|
|
||||
|
|
$
|
8,924,976
|
|
|
$
|
35,871
|
|
|
$
|
(262,955
|
)
|
|
$
|
8,697,892
|
|
|
Fair Value
|
|
Average Credit Rating
|
||
|
(in thousands of U.S. dollars)
|
|
|
||
JPMorgan Chase & Co
|
$
|
102,457
|
|
|
A
|
Bank of America Corp
|
98,272
|
|
|
A
|
|
Citigroup Inc
|
90,987
|
|
|
A
|
|
Apple Inc
|
90,497
|
|
|
AA+
|
|
Morgan Stanley
|
83,923
|
|
|
A-
|
|
Wells Fargo & Co
|
78,160
|
|
|
A
|
|
HSBC Holdings PLC
|
67,753
|
|
|
A
|
|
Anheuser-Busch InBev SA/NV
|
65,995
|
|
|
BBB+
|
|
General Electric Co
|
62,363
|
|
|
BBB+
|
|
Comcast Corp
|
60,930
|
|
|
A-
|
|
|
$
|
801,337
|
|
|
|
|
|
Three Months Ended June 30, 2019
|
||||||||||||||||||
|
|
Non-life
Run-off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
|
|
(in thousands of U.S. dollars)
|
||||||||||||||||||
Net investment income:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturities and cash and cash equivalents
|
|
$
|
61,556
|
|
|
$
|
1,735
|
|
|
$
|
10,723
|
|
|
$
|
581
|
|
|
$
|
74,595
|
|
Equity securities
|
|
2,903
|
|
|
21
|
|
|
498
|
|
|
—
|
|
|
3,422
|
|
|||||
Other
|
|
3,594
|
|
|
404
|
|
|
1,672
|
|
|
(3,167
|
)
|
|
2,503
|
|
|||||
Gross investment income
|
|
68,053
|
|
|
2,160
|
|
|
12,893
|
|
|
(2,586
|
)
|
|
80,520
|
|
|||||
Investment expenses
|
|
(2,196
|
)
|
|
(107
|
)
|
|
(625
|
)
|
|
140
|
|
|
(2,788
|
)
|
|||||
Net investment income (expense)
|
|
$
|
65,857
|
|
|
$
|
2,053
|
|
|
$
|
12,268
|
|
|
$
|
(2,446
|
)
|
|
$
|
77,732
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net realized and unrealized gains and losses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturity securities
|
|
169,494
|
|
|
1,644
|
|
|
19,324
|
|
|
4,214
|
|
|
194,676
|
|
|||||
Equity securities
|
|
13,384
|
|
|
191
|
|
|
371
|
|
|
—
|
|
|
13,946
|
|
|||||
Other investments
|
|
58,664
|
|
|
134
|
|
|
1,960
|
|
|
331
|
|
|
61,089
|
|
|||||
Net realized and unrealized gains and losses
|
|
$
|
241,542
|
|
|
$
|
1,969
|
|
|
$
|
21,655
|
|
|
$
|
4,545
|
|
|
$
|
269,711
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Annualized income from cash and fixed maturities
|
|
$
|
246,224
|
|
|
$
|
6,940
|
|
|
$
|
42,892
|
|
|
$
|
2,324
|
|
|
$
|
298,380
|
|
Average aggregate fixed maturities and cash and cash equivalents, at cost (1)
|
|
8,770,538
|
|
|
255,117
|
|
|
1,650,559
|
|
|
88,201
|
|
|
10,764,415
|
|
|||||
Annualized Investment Book Yield
|
|
2.81
|
%
|
|
2.72
|
%
|
|
2.60
|
%
|
|
2.63
|
%
|
|
2.77
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total financial statement return (2)
|
|
$
|
307,399
|
|
|
$
|
4,022
|
|
|
$
|
33,923
|
|
|
$
|
2,099
|
|
|
$
|
347,443
|
|
Average aggregate invested assets, at fair value (1)
|
|
11,542,943
|
|
|
266,045
|
|
|
1,815,993
|
|
|
100,089
|
|
|
13,725,070
|
|
|||||
Financial Statement Portfolio Return
|
|
2.66
|
%
|
|
1.51
|
%
|
|
1.87
|
%
|
|
2.10
|
%
|
|
2.53
|
%
|
|
|
Three Months Ended June 30, 2018
|
||||||||||||||||||
|
|
Non-life
Run-off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
|
|
(in thousands of U.S. dollars)
|
||||||||||||||||||
Net investment income:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturities and cash and cash equivalents
|
|
$
|
53,738
|
|
|
$
|
1,086
|
|
|
$
|
8,378
|
|
|
$
|
383
|
|
|
$
|
63,585
|
|
Equity securities
|
|
1,057
|
|
|
17
|
|
|
279
|
|
|
(1
|
)
|
|
1,352
|
|
|||||
Other investments and other
|
|
4,370
|
|
|
261
|
|
|
629
|
|
|
(1,182
|
)
|
|
4,078
|
|
|||||
Gross investment income
|
|
59,165
|
|
|
1,364
|
|
|
9,286
|
|
|
(800
|
)
|
|
69,015
|
|
|||||
Investment expenses
|
|
(1,874
|
)
|
|
(79
|
)
|
|
(541
|
)
|
|
(52
|
)
|
|
(2,546
|
)
|
|||||
Net investment income (expense)
|
|
$
|
57,291
|
|
|
$
|
1,285
|
|
|
$
|
8,745
|
|
|
$
|
(852
|
)
|
|
$
|
66,469
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net realized and unrealized gains and losses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturity securities
|
|
$
|
(59,179
|
)
|
|
$
|
(656
|
)
|
|
$
|
(4,861
|
)
|
|
$
|
—
|
|
|
$
|
(64,696
|
)
|
Equity securities
|
|
1,956
|
|
|
85
|
|
|
445
|
|
|
1
|
|
|
2,487
|
|
|||||
Other investments
|
|
11,196
|
|
|
(109
|
)
|
|
1,235
|
|
|
(4,531
|
)
|
|
7,791
|
|
|||||
Net realized and unrealized losses
|
|
$
|
(46,027
|
)
|
|
$
|
(680
|
)
|
|
$
|
(3,181
|
)
|
|
$
|
(4,530
|
)
|
|
$
|
(54,418
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Annualized income from cash and fixed maturities
|
|
$
|
214,952
|
|
|
$
|
4,344
|
|
|
$
|
33,512
|
|
|
$
|
1,532
|
|
|
$
|
254,340
|
|
Average aggregate fixed maturities and cash and cash equivalents, at cost (1)
|
|
7,705,200
|
|
|
264,285
|
|
|
1,508,392
|
|
|
169,468
|
|
|
9,647,345
|
|
|||||
Annualized Investment Book Yield
|
|
2.79
|
%
|
|
1.64
|
%
|
|
2.22
|
%
|
|
0.90
|
%
|
|
2.64
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total financial statement return (2)
|
|
$
|
11,264
|
|
|
$
|
605
|
|
|
$
|
5,564
|
|
|
$
|
(5,382
|
)
|
|
$
|
12,051
|
|
Average aggregate invested assets, at fair value (1)
|
|
9,057,471
|
|
|
271,535
|
|
|
1,645,952
|
|
|
246,142
|
|
|
11,221,100
|
|
|||||
Financial Statement Portfolio Return
|
|
0.12
|
%
|
|
0.22
|
%
|
|
0.34
|
%
|
|
(2.19
|
)%
|
|
0.11
|
%
|
•
|
net realized and unrealized gains on fixed income securities, including fixed income securities within our fund held portfolios, of $194.7 million for the three months ended June 30, 2019, compared to net realized and unrealized losses of $64.7 million for the three months ended June 30, 2018, a change of $259.4 million, primarily driven by higher valuations due to tightening credit spreads in the current period, compared to lower valuations in the comparative period due to increased sovereign yields;
|
•
|
net realized and unrealized gains on equity securities of $13.9 million for the three months ended June 30, 2019, compared to $2.5 million for the three months ended June 30, 2018, an increase of $11.4 million, primarily driven by a more favorable movement in international equity markets in 2019 compared the comparative period; and
|
•
|
net realized and unrealized gains on other investments and other items of $61.1 million for the three months ended June 30, 2019, compared to realized and unrealized gains of $7.8 million for the three months ended June 30, 2018, representing an increase of $53.3 million. The unrealized gains for the three months ended June 30, 2019 primarily comprised of unrealized gains in our hedge funds, equity funds, fixed income funds and private equity funds, principally driven by tightening credit spreads and a more favorable movement in international equity markets in 2019, partially offset by unrealized losses on CLO equities. The unrealized gains for the three months ended June 30, 2018 primarily comprised unrealized gains in our hedge funds, private equity funds and fixed income funds partially offset by unrealized losses in our equity funds, CLO equities and CLO equity funds, and impairments on life settlements.
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||
|
|
Non-life
Run-off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
|
|
(in thousands of U.S. dollars)
|
||||||||||||||||||
Net investment income:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturities and cash and cash equivalents
|
|
$
|
125,805
|
|
|
$
|
3,202
|
|
|
$
|
22,105
|
|
|
$
|
961
|
|
|
$
|
152,073
|
|
Equity securities
|
|
5,781
|
|
|
36
|
|
|
985
|
|
|
—
|
|
|
6,802
|
|
|||||
Other
|
|
6,648
|
|
|
701
|
|
|
2,456
|
|
|
(5,188
|
)
|
|
4,617
|
|
|||||
Gross investment income
|
|
138,234
|
|
|
3,939
|
|
|
25,546
|
|
|
(4,227
|
)
|
|
163,492
|
|
|||||
Investment expenses
|
|
(5,649
|
)
|
|
(175
|
)
|
|
(1,336
|
)
|
|
96
|
|
|
(7,064
|
)
|
|||||
Net investment income (expense)
|
|
$
|
132,585
|
|
|
$
|
3,764
|
|
|
$
|
24,210
|
|
|
$
|
(4,131
|
)
|
|
$
|
156,428
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net realized and unrealized gains and losses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturity securities
|
|
391,771
|
|
|
3,774
|
|
|
41,132
|
|
|
4,150
|
|
|
440,827
|
|
|||||
Equity securities
|
|
25,182
|
|
|
547
|
|
|
(1,852
|
)
|
|
—
|
|
|
23,877
|
|
|||||
Other investments
|
|
260,775
|
|
|
561
|
|
|
3,033
|
|
|
1,429
|
|
|
265,798
|
|
|||||
Net realized and unrealized gains and losses
|
|
$
|
677,728
|
|
|
$
|
4,882
|
|
|
$
|
42,313
|
|
|
$
|
5,579
|
|
|
$
|
730,502
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Annualized income from cash and fixed maturities
|
|
$
|
251,610
|
|
|
$
|
6,404
|
|
|
$
|
44,210
|
|
|
$
|
1,922
|
|
|
$
|
304,146
|
|
Average aggregate fixed maturities and cash and cash equivalents, at cost (1)
|
|
8,615,603
|
|
|
257,734
|
|
|
1,657,638
|
|
|
123,220
|
|
|
10,654,195
|
|
|||||
Annualized Investment Book Yield
|
|
2.92
|
%
|
|
2.48
|
%
|
|
2.67
|
%
|
|
1.56
|
%
|
|
2.85
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total financial statement return (2)
|
|
$
|
810,313
|
|
|
$
|
8,646
|
|
|
$
|
66,523
|
|
|
$
|
1,448
|
|
|
$
|
886,930
|
|
Average aggregate invested assets, at fair value (1)
|
|
11,141,014
|
|
|
267,148
|
|
|
1,807,289
|
|
|
136,948
|
|
|
13,352,399
|
|
|||||
Financial Statement Portfolio Return
|
|
7.27
|
%
|
|
3.24
|
%
|
|
3.68
|
%
|
|
1.06
|
%
|
|
6.64
|
%
|
|
|
Six Months Ended June 30, 2018
|
||||||||||||||||||
|
|
Non-life
Run-off
|
|
Atrium
|
|
StarStone
|
|
Other
|
|
Total
|
||||||||||
|
|
(in thousands of U.S. dollars)
|
||||||||||||||||||
Net investment income:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturities and cash and cash equivalents
|
|
$
|
102,275
|
|
|
$
|
2,146
|
|
|
$
|
16,136
|
|
|
$
|
753
|
|
|
$
|
121,310
|
|
Equity securities
|
|
2,260
|
|
|
30
|
|
|
553
|
|
|
(1
|
)
|
|
2,842
|
|
|||||
Other investments and other
|
|
8,083
|
|
|
429
|
|
|
1,251
|
|
|
4,288
|
|
|
14,051
|
|
|||||
Gross investment income
|
|
112,618
|
|
|
2,605
|
|
|
17,940
|
|
|
5,040
|
|
|
138,203
|
|
|||||
Investment expenses
|
|
(3,676
|
)
|
|
(135
|
)
|
|
(1,494
|
)
|
|
(110
|
)
|
|
(5,415
|
)
|
|||||
Net investment income
|
|
$
|
108,942
|
|
|
$
|
2,470
|
|
|
$
|
16,446
|
|
|
$
|
4,930
|
|
|
$
|
132,788
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net realized and unrealized gains and losses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturity securities
|
|
$
|
(181,705
|
)
|
|
$
|
(1,956
|
)
|
|
$
|
(19,146
|
)
|
|
$
|
5
|
|
|
$
|
(202,802
|
)
|
Equity securities
|
|
2,176
|
|
|
45
|
|
|
5,004
|
|
|
—
|
|
|
7,225
|
|
|||||
Other investments
|
|
7,206
|
|
|
(172
|
)
|
|
(1,997
|
)
|
|
(6,908
|
)
|
|
(1,871
|
)
|
|||||
Net realized and unrealized losses
|
|
$
|
(172,323
|
)
|
|
$
|
(2,083
|
)
|
|
$
|
(16,139
|
)
|
|
$
|
(6,903
|
)
|
|
$
|
(197,448
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Annualized income from cash and fixed maturities
|
|
$
|
204,550
|
|
|
$
|
4,292
|
|
|
$
|
32,272
|
|
|
$
|
1,506
|
|
|
$
|
242,620
|
|
Average aggregate fixed maturities and cash and cash equivalents, at cost (1)
|
|
7,663,113
|
|
|
265,005
|
|
|
1,498,057
|
|
|
162,084
|
|
|
9,588,259
|
|
|||||
Annualized Investment Book Yield
|
|
2.67
|
%
|
|
1.62
|
%
|
|
2.15
|
%
|
|
0.93
|
%
|
|
2.53
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total financial statement return (2)
|
|
$
|
(63,381
|
)
|
|
$
|
387
|
|
|
$
|
307
|
|
|
$
|
(1,973
|
)
|
|
$
|
(64,660
|
)
|
Average aggregate invested assets, at fair value (1)
|
|
8,845,288
|
|
|
272,924
|
|
|
1,650,335
|
|
|
272,102
|
|
|
11,040,649
|
|
|||||
Financial Statement Portfolio Return
|
|
(0.72
|
)%
|
|
0.14
|
%
|
|
0.02
|
%
|
|
(0.73
|
)%
|
|
(0.59
|
)%
|
•
|
net realized and unrealized gains on fixed income securities, including fixed income securities within our funds held portfolios, of $440.8 million for the six months ended June 30, 2019, compared to net realized and unrealized losses of $202.8 million for the six months ended June 30, 2018, an increase of $643.6 million, primarily driven by higher valuations due to tightening credit spreads in the current period, compared to lower valuations in the comparative period due to increased sovereign yields;
|
•
|
net realized and unrealized gains on equity securities of $23.9 million for the six months ended June 30, 2019, compared to $7.2 million for the six months ended June 30, 2018, an increase of $16.7 million, primarily driven by a more favorable movement in international equity markets in 2019 compared to the comparative period; and
|
•
|
net realized and unrealized gains on other investments and other items of $265.8 million for the six months ended June 30, 2019, compared to realized and unrealized losses of $1.9 million for the six months ended June 30, 2018, representing a change of $267.7 million. The unrealized gains for the six months ended June 30, 2019 primarily comprised unrealized gains in our hedge funds, equity funds, fixed income funds and private equity funds, principally driven by tightening credit spreads and a more favorable movement in international equity markets in 2019. The unrealized losses for the six months ended June 30, 2018 primarily comprised unrealized losses in our private equity funds, equity funds, call options on equity and impairments on life settlements, partially offset by unrealized gains on hedge funds and fixed income funds.
|
|
|
June 30,
2019 |
|
December 31,
2018 |
|
Change
|
||||||
|
|
(in thousands of U.S. dollars)
|
||||||||||
Ordinary shareholders' equity
|
|
$
|
4,004,830
|
|
|
$
|
3,391,933
|
|
|
$
|
612,897
|
|
Series D and E Preferred Shares
|
|
510,000
|
|
|
510,000
|
|
|
—
|
|
|||
Total Enstar Group Limited Shareholders' Equity (A)
|
|
4,514,830
|
|
|
3,901,933
|
|
|
612,897
|
|
|||
Noncontrolling interest
|
|
12,609
|
|
|
12,056
|
|
|
553
|
|
|||
Total Shareholders' Equity (B)
|
|
4,527,439
|
|
|
3,913,989
|
|
|
613,450
|
|
|||
|
|
|
|
|
|
|
||||||
Senior Notes
|
|
841,859
|
|
|
348,054
|
|
|
493,805
|
|
|||
Revolving credit facility
|
|
206,853
|
|
|
15,000
|
|
|
191,853
|
|
|||
Term loan facility
|
|
448,735
|
|
|
498,485
|
|
|
(49,750
|
)
|
|||
Total debt (C)
|
|
1,497,447
|
|
|
861,539
|
|
|
635,908
|
|
|||
|
|
|
|
|
|
|
||||||
Redeemable noncontrolling interest (D)
|
|
435,696
|
|
|
458,543
|
|
|
(22,847
|
)
|
|||
|
|
|
|
|
|
|
||||||
Total capitalization = (B) + (C) + (D)
|
|
$
|
6,460,582
|
|
|
$
|
5,234,071
|
|
|
$
|
1,226,511
|
|
|
|
|
|
|
|
|
||||||
Total capitalization attributable to Enstar = (A) + (C)
|
|
$
|
6,012,277
|
|
|
$
|
4,763,472
|
|
|
$
|
1,248,805
|
|
|
|
|
|
|
|
|
||||||
Debt to total capitalization
|
|
23.2
|
%
|
|
16.5
|
%
|
|
6.7
|
%
|
|||
Debt and Series D and E Preferred Shares to total capitalization
|
|
31.1
|
%
|
|
26.2
|
%
|
|
4.9
|
%
|
|||
|
|
|
|
|
|
|
||||||
Debt to total capitalization attributable to Enstar
|
|
24.9
|
%
|
|
18.1
|
%
|
|
6.8
|
%
|
|||
Debt and Series D and E Preferred Shares to total capitalization available to Enstar
|
|
33.4
|
%
|
|
28.8
|
%
|
|
4.6
|
%
|
|
|
Six Months Ended June 30,
|
|
|
||||||||
|
|
2019
|
|
2018
|
|
Change
|
||||||
|
|
(in thousands of U.S. dollars)
|
||||||||||
Cash provided by (used in):
|
|
|
|
|
|
|
||||||
Operating activities
|
|
$
|
95,671
|
|
|
$
|
(112,550
|
)
|
|
$
|
208,221
|
|
Investing activities
|
|
(153,803
|
)
|
|
(105,001
|
)
|
|
(48,802
|
)
|
|||
Financing activities
|
|
605,769
|
|
|
185,538
|
|
|
420,231
|
|
|||
Effect of exchange rate changes on cash
|
|
(6,436
|
)
|
|
2,770
|
|
|
(9,206
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
541,201
|
|
|
(29,243
|
)
|
|
570,444
|
|
|||
Cash and cash equivalents, beginning of period
|
|
982,584
|
|
|
1,212,836
|
|
|
(230,252
|
)
|
|||
Cash and cash equivalents, end of period
|
|
$
|
1,523,785
|
|
|
$
|
1,183,593
|
|
|
$
|
340,192
|
|
Facility
|
|
Origination Date
|
|
Term
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
4.50% Senior Notes due 2022
|
|
March 10, 2017
|
|
5 years
|
|
$
|
348,265
|
|
|
$
|
348,054
|
|
4.95% Senior Notes due 2029
|
|
May 28, 2019
|
|
10 years
|
|
493,594
|
|
|
—
|
|
||
Total Senior Notes
|
|
|
|
|
|
841,859
|
|
|
348,054
|
|
||
EGL Revolving Credit Facility
|
|
August 16, 2018
|
|
5 years
|
|
206,853
|
|
|
15,000
|
|
||
2018 EGL Term Loan Facility
|
|
December 27, 2018
|
|
3 years
|
|
448,735
|
|
|
498,485
|
|
||
Total debt obligations
|
|
|
|
$
|
1,497,447
|
|
|
$
|
861,539
|
|
|
Total
|
|
Less than
1 Year
|
|
1 - 3
years
|
|
3 - 5
years |
|
6 - 10
years |
|
More than
10 Years |
||||||||||||
|
(in millions of U.S. dollars)
|
||||||||||||||||||||||
Operating Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Estimated gross reserves for losses and LAE (1)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asbestos
|
$
|
1,542.7
|
|
|
$
|
93.6
|
|
|
$
|
173.4
|
|
|
$
|
162.4
|
|
|
$
|
289.0
|
|
|
$
|
824.3
|
|
Environmental
|
217.7
|
|
|
20.0
|
|
|
37.0
|
|
|
32.7
|
|
|
51.6
|
|
|
76.4
|
|
||||||
General Casualty
|
962.5
|
|
|
242.6
|
|
|
296.1
|
|
|
154.9
|
|
|
133.8
|
|
|
135.1
|
|
||||||
Workers' compensation/personal accident
|
2,151.6
|
|
|
245.2
|
|
|
352.0
|
|
|
267.0
|
|
|
385.4
|
|
|
902.0
|
|
||||||
Marine, aviation and transit
|
477.7
|
|
|
142.3
|
|
|
153.9
|
|
|
67.4
|
|
|
59.2
|
|
|
54.9
|
|
||||||
Construction defect
|
148.9
|
|
|
36.2
|
|
|
53.1
|
|
|
29.9
|
|
|
21.0
|
|
|
8.7
|
|
||||||
Professional indemnity/ Directors & Officers
|
1,037.9
|
|
|
275.7
|
|
|
346.8
|
|
|
176.8
|
|
|
142.2
|
|
|
96.4
|
|
||||||
Motor
|
798.0
|
|
|
272.1
|
|
|
231.1
|
|
|
93.6
|
|
|
78.5
|
|
|
122.7
|
|
||||||
Property
|
224.9
|
|
|
88.9
|
|
|
74.4
|
|
|
29.6
|
|
|
18.5
|
|
|
13.5
|
|
||||||
Other
|
354.4
|
|
|
86.0
|
|
|
94.9
|
|
|
51.6
|
|
|
57.0
|
|
|
64.9
|
|
||||||
Total Non-Life Run-off
|
7,916.3
|
|
|
1,502.6
|
|
|
1,812.7
|
|
|
1,065.9
|
|
|
1,236.2
|
|
|
2,298.9
|
|
||||||
Atrium
|
215.9
|
|
|
88.7
|
|
|
77.9
|
|
|
29.8
|
|
|
16.3
|
|
|
3.2
|
|
||||||
StarStone
|
1,756.5
|
|
|
628.9
|
|
|
627.7
|
|
|
253.1
|
|
|
176.0
|
|
|
70.8
|
|
||||||
Other
|
23.6
|
|
|
3.5
|
|
|
9.5
|
|
|
4.6
|
|
|
4.0
|
|
|
2.0
|
|
||||||
ULAE
|
362.8
|
|
|
68.6
|
|
|
84.9
|
|
|
49.8
|
|
|
57.4
|
|
|
102.1
|
|
||||||
Estimated gross reserves for losses and LAE (1)
|
10,275.1
|
|
|
2,292.3
|
|
|
2,612.7
|
|
|
1,403.2
|
|
|
1,489.9
|
|
|
2,477.0
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating lease obligations
|
59.3
|
|
|
11.7
|
|
|
19.2
|
|
|
13.9
|
|
|
12.4
|
|
|
2.1
|
|
||||||
Investing Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investment commitments to private equity funds
|
245.1
|
|
|
126.3
|
|
|
99.0
|
|
|
19.8
|
|
|
—
|
|
|
—
|
|
||||||
Investment commitments to equity method investments
|
124.3
|
|
|
124.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Financing Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loan repayments (including estimated interest payments)
|
1,870.6
|
|
|
64.3
|
|
|
919.4
|
|
|
263.2
|
|
|
623.7
|
|
|
—
|
|
||||||
Total
|
$
|
12,574.4
|
|
|
$
|
2,618.9
|
|
|
$
|
3,650.3
|
|
|
$
|
1,700.1
|
|
|
$
|
2,126.0
|
|
|
$
|
2,479.1
|
|
(1)
|
The reserves for losses and LAE represent management’s estimate of the ultimate cost of settling losses. The estimation of losses is based on various complex and subjective judgments. Actual losses paid may differ, perhaps significantly, from the reserve estimates reflected in our financial statements. Similarly, the timing of payment of our estimated losses is not fixed and there may be significant changes in actual payment activity. The assumptions used in estimating the likely payments due by period are based on our historical claims payment experience and industry payment patterns, but due to the inherent uncertainty in the process of estimating the timing of such payments, there is a risk that the amounts paid in any such period can be significantly different from the amounts disclosed above. The amounts in the above table represent our estimates of known liabilities as of June 30, 2019 and do not take into account corresponding reinsurance balance recoverable amounts that would be due to us. Furthermore, certain of the reserves included in the unaudited condensed consolidated financial statements as of June 30, 2019 were acquired by us and initially recorded at fair value with subsequent amortization, whereas the expected payments by period in the table above are the estimated payments at a future time and do not reflect the fair value adjustment in the amount payable.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(expressed in thousands of U.S. dollars, except share and per share data)
|
||||||||||||||
Net earnings (loss) attributable to Enstar Group Limited ordinary shareholders
|
$
|
231,842
|
|
|
$
|
8,244
|
|
|
$
|
590,593
|
|
|
$
|
(32,966
|
)
|
Adjustments:
|
|
|
|
|
|
|
|
||||||||
Net realized and unrealized (gains) losses on fixed maturity investments and funds held - directly managed (1)
|
(194,676
|
)
|
|
64,696
|
|
|
(440,827
|
)
|
|
202,802
|
|
||||
Change in fair value of insurance contracts for which we have elected the fair value option
|
37,962
|
|
|
17,233
|
|
|
94,003
|
|
|
(23,008
|
)
|
||||
Tax effects of adjustments (2)
|
20,536
|
|
|
(4,734
|
)
|
|
42,385
|
|
|
(15,960
|
)
|
||||
Adjustments attributable to noncontrolling interest (3)
|
7,569
|
|
|
(2,488
|
)
|
|
16,739
|
|
|
(8,290
|
)
|
||||
Non-GAAP operating income attributable to Enstar Group Limited ordinary shareholders (4)
|
$
|
103,233
|
|
|
$
|
82,951
|
|
|
$
|
302,893
|
|
|
$
|
122,578
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted net earnings (loss) per ordinary share
|
$
|
10.70
|
|
|
$
|
0.40
|
|
|
$
|
27.26
|
|
|
$
|
(1.65
|
)
|
Adjustments:
|
|
|
|
|
|
|
|
||||||||
Net realized and unrealized (gains) losses on fixed maturity investments and funds held - directly managed (1)
|
(8.99
|
)
|
|
3.13
|
|
|
(20.35
|
)
|
|
10.08
|
|
||||
Change in fair value of insurance contracts for which we have elected the fair value option
|
1.75
|
|
|
0.83
|
|
|
4.34
|
|
|
(1.14
|
)
|
||||
Tax effects of adjustments (2)
|
0.95
|
|
|
(0.23
|
)
|
|
1.96
|
|
|
(0.79
|
)
|
||||
Adjustments attributable to noncontrolling interest (3)
|
0.35
|
|
|
(0.12
|
)
|
|
0.77
|
|
|
(0.41
|
)
|
||||
Diluted non-GAAP operating income per ordinary share (4)
|
$
|
4.76
|
|
|
$
|
4.01
|
|
|
$
|
13.98
|
|
|
$
|
6.09
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average ordinary shares outstanding - diluted
|
21,675,451
|
|
|
20,671,232
|
|
|
21,661,769
|
|
|
20,140,367
|
|
•
|
risks associated with implementing our business strategies and initiatives;
|
•
|
the adequacy of our loss reserves and the need to adjust such reserves as claims develop over time;
|
•
|
risks relating to our acquisitions, including our ability to evaluate opportunities, successfully price acquisitions, evaluate opportunities, address operational challenges, support our planned growth and assimilate acquired companies into our internal control system in order to maintain effective internal controls, provide reliable financial reports and prevent fraud;
|
•
|
risks relating to our active underwriting businesses, including unpredictability and severity of catastrophic and other major loss events, failure of risk management and loss limitation methods, the risk of a ratings downgrade or withdrawal, cyclicality of demand and pricing in the insurance and reinsurance markets;
|
•
|
risks relating to the performance of our investment portfolio and our ability to structure our investments in a manner that recognizes our liquidity needs;
|
•
|
changes and uncertainty in economic conditions, including interest rates, inflation, currency exchange rates, equity markets and credit conditions, which could affect our investment portfolio, our ability to finance future acquisitions and our profitability;
|
•
|
the risk that ongoing or future industry regulatory developments will disrupt our business, affect the ability of our subsidiaries to operate in the ordinary course or to make distributions to us, or mandate changes in industry practices in ways that increase our costs, decrease our revenues or require us to alter aspects of the way we do business;
|
•
|
risks relating to the variability of statutory capital requirements and the risk that we may require additional capital in the future, which may not be available or may be available only on unfavorable terms;
|
•
|
risks relating to the availability and collectability of our reinsurance;
|
•
|
losses due to foreign currency exchange rate fluctuations;
|
•
|
increased competitive pressures, including the consolidation and increased globalization of reinsurance providers;
|
•
|
emerging claim and coverage issues;
|
•
|
lengthy and unpredictable litigation affecting assessment of losses and/or coverage issues;
|
•
|
loss of key personnel;
|
•
|
the ability of our subsidiaries to distribute funds to us and the resulting impact on our liquidity;
|
•
|
our ability to comply with covenants in our debt agreements;
|
•
|
changes in our plans, strategies, objectives, expectations or intentions, which may happen at any time at management’s discretion;
|
•
|
operational risks, including system, data security or human failures and external hazards;
|
•
|
risks relating to our ability to obtain regulatory approvals, including the timing, terms and conditions of any such approvals, and to satisfy other closing conditions in connection with our acquisition agreements, which could affect our ability to complete acquisitions;
|
•
|
our ability to implement our strategies relating to our active underwriting businesses;
|
•
|
risks relating to our subsidiaries with liabilities arising from legacy manufacturing operations;
|
•
|
tax, regulatory or legal restrictions or limitations applicable to us or the insurance and reinsurance business generally;
|
•
|
changes in tax laws or regulations applicable to us or our subsidiaries, or the risk that we or one of our non-U.S. subsidiaries become subject to significant, or significantly increased, income taxes in the United States or elsewhere;
|
•
|
changes in Bermuda law or regulation or the political stability of Bermuda; and
|
•
|
changes in accounting policies or practices.
|
|
|
Interest Rate Shift in Basis Points
|
||||||||||||||||||
As of June 30, 2019
|
|
-100
|
|
-50
|
|
—
|
|
+50
|
|
+100
|
||||||||||
|
|
(in millions of U.S. dollars)
|
||||||||||||||||||
Total Market Value
|
|
$
|
10,120
|
|
|
$
|
9,874
|
|
|
$
|
9,637
|
|
|
$
|
9,392
|
|
|
$
|
9,160
|
|
Market Value Change from Base
|
|
5.0
|
%
|
|
2.5
|
%
|
|
—
|
|
|
(2.5
|
)%
|
|
(4.9
|
)%
|
|||||
Change in Unrealized Value
|
|
$
|
483
|
|
|
$
|
237
|
|
|
$
|
—
|
|
|
$
|
(245
|
)
|
|
$
|
(477
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
As of December 31, 2018
|
|
-100
|
|
-50
|
|
—
|
|
+50
|
|
+100
|
||||||||||
Total Market Value
|
|
$
|
9,555
|
|
|
$
|
9,325
|
|
|
$
|
9,101
|
|
|
$
|
8,885
|
|
|
$
|
8,677
|
|
Market Value Change from Base
|
|
5.0
|
%
|
|
2.5
|
%
|
|
—
|
|
|
(2.4
|
)%
|
|
(4.7
|
)%
|
|||||
Change in Unrealized Value
|
|
$
|
454
|
|
|
$
|
224
|
|
|
$
|
—
|
|
|
$
|
(216
|
)
|
|
$
|
(424
|
)
|
|
|
Credit Spread Shift in Basis Points
|
||||||||||
As at June 30, 2019
|
|
—
|
|
+50
|
|
+100
|
||||||
|
|
(in millions of U.S. dollars)
|
||||||||||
Total Market Value
|
|
$
|
9,637
|
|
|
$
|
9,426
|
|
|
$
|
9,222
|
|
Market Value Change from Base
|
|
|
|
(2.2
|
)%
|
|
(4.3
|
)%
|
||||
Change in Unrealized Value
|
|
|
|
$
|
(211
|
)
|
|
$
|
(415
|
)
|
||
|
|
|
|
|
|
|
||||||
As at December 31, 2018
|
|
—
|
|
+50
|
|
+100
|
||||||
Total Market Value
|
|
$
|
9,101
|
|
|
$
|
8,896
|
|
|
$
|
8,699
|
|
Market Value Change from Base
|
|
|
|
(2.3
|
)%
|
|
(4.4
|
)%
|
||||
Change in Unrealized Value
|
|
|
|
$
|
(205
|
)
|
|
$
|
(402
|
)
|
Credit rating
|
June 30, 2019
|
|
December 31, 2018
|
|
Change
|
|||
AAA
|
24.3
|
%
|
|
28.2
|
%
|
|
(3.9
|
)%
|
AA
|
15.0
|
%
|
|
14.4
|
%
|
|
0.6
|
%
|
A
|
32.6
|
%
|
|
30.2
|
%
|
|
2.4
|
%
|
BBB
|
24.4
|
%
|
|
23.4
|
%
|
|
1.0
|
%
|
Non-investment grade
|
3.5
|
%
|
|
3.6
|
%
|
|
(0.1
|
)%
|
Not rated
|
0.2
|
%
|
|
0.2
|
%
|
|
—
|
%
|
Total
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|||
Average credit rating
|
A+
|
|
|
A+
|
|
|
|
|
June 30,
2019 |
|
December 31,
2018 |
|
Change
|
||||||
|
(in millions of U.S. dollars)
|
||||||||||
Publicly traded equity investments in common and preferred stocks
|
$
|
206.6
|
|
|
$
|
138.4
|
|
|
$
|
68.2
|
|
Privately held equity investments in common and preferred stocks
|
229.4
|
|
|
228.7
|
|
|
0.7
|
|
|||
Private equity funds
|
245.0
|
|
|
248.6
|
|
|
(3.6
|
)
|
|||
Equity funds
|
378.8
|
|
|
333.7
|
|
|
45.1
|
|
|||
Call options on equity
|
1.9
|
|
|
—
|
|
|
1.9
|
|
|||
Fair value of equities at risk
|
$
|
1,061.7
|
|
|
$
|
949.4
|
|
|
$
|
112.3
|
|
|
|
|
|
|
|
||||||
Impact of 10% decline in fair value
|
$
|
106.2
|
|
|
$
|
94.9
|
|
|
$
|
11.3
|
|
As of June 30, 2019
|
|
AUD
|
|
CAD
|
|
EUR
|
|
GBP
|
|
Other
|
|
Total
|
||||||||||||
|
|
(in millions of U.S. dollars)
|
||||||||||||||||||||||
Total net foreign currency exposure
|
|
$
|
15.4
|
|
|
$
|
(3.6
|
)
|
|
$
|
15.2
|
|
|
$
|
(1.1
|
)
|
|
$
|
(1.3
|
)
|
|
$
|
24.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Pre-tax impact of a 10% movement of the U.S. dollar(1)
|
|
$
|
1.5
|
|
|
$
|
(0.4
|
)
|
|
$
|
1.5
|
|
|
$
|
(0.1
|
)
|
|
$
|
(0.1
|
)
|
|
$
|
2.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
As of December 31, 2018
|
|
AUD
|
|
CAD
|
|
EUR
|
|
GBP
|
|
Other
|
|
Total
|
||||||||||||
|
|
(in millions of U.S. dollars)
|
||||||||||||||||||||||
Total net foreign currency exposure
|
|
$
|
17.5
|
|
|
$
|
20.2
|
|
|
$
|
17.2
|
|
|
$
|
(35.8
|
)
|
|
$
|
1.7
|
|
|
$
|
20.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Pre-tax impact of a 10% movement of the U.S. dollar(1)
|
|
$
|
1.8
|
|
|
$
|
2.0
|
|
|
$
|
1.7
|
|
|
$
|
(3.6
|
)
|
|
$
|
0.2
|
|
|
$
|
2.1
|
|
(1)
|
Assumes 10% change in the U.S. dollar relative to other currencies
|
Exhibit
No.
|
|
Description
|
|
Memorandum of Association of Enstar Group Limited (incorporated by reference to Exhibit 3.1 of the Company’s Form 10-K/A filed on May 2, 2011).
|
|
|
|
|
|
Fifth Amended and Restated Bye-Laws of Enstar Group Limited (incorporated by reference to Exhibit 3.1 of the Company’s Form 8-K filed on June 13, 2019).
|
|
|
|
|
|
Certificate of Designations of Series C Participating Non-Voting Perpetual Preferred Stock (incorporated by reference to Exhibit 3.1 of the Company’s Form 8-K filed on June 17, 2016).
|
|
|
|
|
|
Certificate of Designations of 7.00% fixed-to-floating rate perpetual non-cumulative preference shares, Series D (incorporated by reference to Exhibit 4.1 of the Company’s Form 8-K filed on June 27, 2018).
|
|
|
|
|
|
Certificate of Designations of 7.00% perpetual non-cumulative preference shares, Series E (incorporated by reference to Exhibit 4.1 of the Company’s Form 8-K filed on November 21, 2018).
|
|
|
|
|
|
Third Supplemental Indenture, dated as of May 28, 2019, between the Company and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.2 of the Company's Form 8-K filed May 28, 2019).
|
|
|
|
|
10.1*
|
|
Amendment to Master Agreement, dated June 28, 2019, by and among Maiden Holdings, Ltd., Maiden Reinsurance Ltd. and Enstar Group Limited.
|
|
|
|
31.1*
|
|
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934 as adopted under Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
31.2*
|
|
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934 as adopted under Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
32.1**
|
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
32.2**
|
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
101.INS
|
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
ENSTAR GROUP LIMITED
|
|
|
By:
|
/S/ GUY BOWKER
|
|
Guy Bowker
Chief Financial Officer, Authorized Signatory, Principal Financial Officer and Principal Accounting Officer
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Enstar Group Limited;
|
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 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 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 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.
|
/S/ DOMINIC F. SILVESTER
|
Dominic F. Silvester
|
Chief Executive Officer
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Enstar Group Limited;
|
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 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 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 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.
|
/S/ GUY BOWKER
|
Guy Bowker
|
Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/S/ DOMINIC F. SILVESTER
|
Dominic F. Silvester
|
Chief Executive 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/ GUY BOWKER
|
Guy Bowker
|
Chief Financial Officer
|