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.) |
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% | ESGRP | The NASDAQ Stock Market | LLC | ||||||||
Fixed-to-Floating Rate Perpetual Non-Cumulative Preferred Share, Series D, Par Value $1.00 Per Share | |||||||||||
Depositary Shares, Each Representing a 1/1,000th Interest in a 7.00% | ESGRO | The NASDAQ Stock Market | LLC | ||||||||
Perpetual Non-Cumulative Preferred Share, Series E, Par Value $1.00 Per Share |
Large accelerated filer | þ | Accelerated filer | ¨ | Non-accelerated filer | ¨ | Smaller reporting company | ☐ | Emerging growth company | ☐ |
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 | ||||
September 30, 2020 | December 31, 2019 | ||||||||||
(expressed in thousands of U.S. dollars, except share data) | |||||||||||
ASSETS | |||||||||||
Short-term investments, trading, at fair value | $ | 7,133 | $ | 51,490 | |||||||
Short-term investments, available-for-sale, at fair value (amortized cost: 2020 — $278,221; 2019 — $128,311; net of allowance: 2020 — $nil)
|
278,175 | 128,335 | |||||||||
Fixed maturities, trading, at fair value | 4,999,642 | 6,143,335 | |||||||||
Fixed maturities, available-for-sale, at fair value (amortized cost: 2020 — $2,837,359; 2019 — $1,537,815; net of allowance: 2020 — $912)
|
2,883,472 | 1,538,052 | |||||||||
Funds held - directly managed | 1,066,639 | 1,187,552 | |||||||||
Equities, at fair value | 653,159 | 726,721 | |||||||||
Other investments, at fair value | 3,704,870 | 2,518,031 | |||||||||
Equity method investments | 516,795 | 326,277 | |||||||||
14,109,885 | 12,619,793 | ||||||||||
Cash and cash equivalents | 640,601 | 624,472 | |||||||||
Restricted cash and cash equivalents | 556,721 | 346,877 | |||||||||
Premiums receivable | 450,977 | 491,511 | |||||||||
157,827 | 155,793 | ||||||||||
Reinsurance balances recoverable on paid and unpaid losses (net of allowance: 2020 — $135,117) (Note 7)
|
1,338,495 | 1,485,616 | |||||||||
543,161 | 695,518 | ||||||||||
365,288 | 448,855 | ||||||||||
Funds held by reinsured companies | 657,490 | 475,732 | |||||||||
Deferred acquisition costs | 52,899 | 116,513 | |||||||||
62,959 | 191,568 | ||||||||||
Other assets | 677,797 | 699,081 | |||||||||
2,156,488 | 1,474,770 | ||||||||||
TOTAL ASSETS | $ | 21,770,588 | $ | 19,826,099 | |||||||
LIABILITIES | |||||||||||
$ | 7,878,206 | $ | 7,247,282 | ||||||||
2,422,678 | 2,621,122 | ||||||||||
754,037 | 847,685 | ||||||||||
Unearned premiums | 335,336 | 533,692 | |||||||||
Insurance and reinsurance balances payable | 581,615 | 420,546 | |||||||||
6,493 | 16,074 | ||||||||||
1,447,908 | 1,191,207 | ||||||||||
Other liabilities | 478,888 | 444,818 | |||||||||
1,653,343 | 1,208,531 | ||||||||||
TOTAL LIABILITIES | 15,558,504 | 14,530,957 | |||||||||
376,731 | 438,791 | ||||||||||
Ordinary shares (par value $1 each, issued and outstanding 2020: 22,069,444; 2019: 21,511,505):
|
|||||||||||
Voting Ordinary shares (issued and outstanding 2020: 18,559,762; 2019: 18,001,823)
|
18,560 | 18,002 | |||||||||
Non-voting convertible ordinary Series C Shares (issued and outstanding 2020 and 2019: 2,599,672)
|
2,600 | 2,600 | |||||||||
Non-voting convertible ordinary Series E Shares (issued and outstanding 2020 and 2019: 910,010)
|
910 | 910 | |||||||||
Preferred Shares: | |||||||||||
Series C Preferred Shares (issued and held in treasury 2020 and 2019: 388,571)
|
389 | 389 | |||||||||
Series D Preferred Shares (issued and outstanding 2020 and 2019: 16,000)
|
400,000 | 400,000 | |||||||||
Series E Preferred Shares (issued and outstanding 2020 and 2019: 4,400)
|
110,000 | 110,000 | |||||||||
Treasury shares, at cost (Series C Preferred shares 2020 and 2019: 388,571)
|
(421,559) | (421,559) | |||||||||
Joint Share Ownership Plan (voting ordinary shares, held in trust 2020: 565,630)
|
(566) | — | |||||||||
Additional paid-in capital | 1,832,130 | 1,836,778 | |||||||||
Accumulated other comprehensive income | 61,873 | 7,171 | |||||||||
Retained earnings | 3,816,548 | 2,887,892 | |||||||||
Total Enstar Shareholders’ Equity | 5,820,885 | 4,842,183 | |||||||||
14,468 | 14,168 | ||||||||||
TOTAL SHAREHOLDERS’ EQUITY | 5,835,353 | 4,856,351 | |||||||||
TOTAL LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS’ EQUITY | $ | 21,770,588 | $ | 19,826,099 |
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
(expressed in thousands of U.S. dollars, except share and per share data) | |||||||||||||||||||||||
INCOME | |||||||||||||||||||||||
Net premiums earned | $ | 161,724 | $ | 175,802 | $ | 463,946 | $ | 618,711 | |||||||||||||||
Fees and commission income | 10,787 | 6,437 | 28,325 | 18,931 | |||||||||||||||||||
Net investment income | 72,130 | 81,502 | 241,287 | 231,424 | |||||||||||||||||||
Net realized and unrealized gains | 500,005 | 145,060 | 838,552 | 858,489 | |||||||||||||||||||
Other income | 48,404 | 822 | 67,761 | 15,368 | |||||||||||||||||||
793,050 | 409,623 | 1,639,871 | 1,742,923 | ||||||||||||||||||||
EXPENSES | |||||||||||||||||||||||
Net incurred losses and loss adjustment expenses | 109,686 | 163,258 | 339,678 | 566,111 | |||||||||||||||||||
Acquisition costs | 37,708 | 33,310 | 132,818 | 162,192 | |||||||||||||||||||
General and administrative expenses | 115,828 | 97,365 | 359,086 | 296,304 | |||||||||||||||||||
Interest expense | 15,003 | 14,950 | 42,436 | 39,022 | |||||||||||||||||||
Net foreign exchange (gains) losses | 8,156 | (13,665) | 1,375 | (20,097) | |||||||||||||||||||
286,381 | 295,218 | 875,393 | 1,043,532 | ||||||||||||||||||||
EARNINGS BEFORE INCOME TAXES | 506,669 | 114,405 | 764,478 | 699,391 | |||||||||||||||||||
Income tax expense | (13,915) | (13,465) | (25,295) | (25,265) | |||||||||||||||||||
Earnings from equity method investments | 149,065 | 17,703 | 152,725 | 44,188 | |||||||||||||||||||
NET EARNINGS FROM CONTINUING OPERATIONS | 641,819 | 118,643 | 891,908 | 718,314 | |||||||||||||||||||
NET EARNINGS FROM DISCONTINUED OPERATIONS, NET OF INCOME TAXES | 4,031 | 7,916 | 810 | 12,041 | |||||||||||||||||||
NET EARNINGS | 645,850 | 126,559 | 892,718 | 730,355 | |||||||||||||||||||
Net (earnings) loss attributable to noncontrolling interest | (21,912) | 109 | 30,802 | 4,970 | |||||||||||||||||||
NET EARNINGS ATTRIBUTABLE TO ENSTAR | 623,938 | 126,668 | 923,520 | 735,325 | |||||||||||||||||||
Dividends on preferred shares | (8,925) | (8,925) | (26,775) | (26,989) | |||||||||||||||||||
NET EARNINGS ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | 615,013 | $ | 117,743 | $ | 896,745 | $ | 708,336 | |||||||||||||||
Earnings per ordinary share attributable to Enstar: | |||||||||||||||||||||||
Basic: | |||||||||||||||||||||||
Net earnings from continuing operations | $ | 28.39 | $ | 5.26 | $ | 41.56 | $ | 32.65 | |||||||||||||||
Net earnings from discontinued operations | 0.11 | 0.22 | 0.02 | 0.33 | |||||||||||||||||||
Net earnings per ordinary share | $ | 28.50 | $ | 5.48 | $ | 41.58 | $ | 32.98 | |||||||||||||||
Diluted: | |||||||||||||||||||||||
Net earnings from continuing operations | $ | 28.13 | $ | 5.21 | $ | 41.12 | $ | 32.25 | |||||||||||||||
Net earnings from discontinued operations | 0.11 | 0.21 | 0.02 | 0.33 | |||||||||||||||||||
Net earnings per ordinary share | $ | 28.24 | $ | 5.42 | $ | 41.14 | $ | 32.58 | |||||||||||||||
Weighted average ordinary shares outstanding: | |||||||||||||||||||||||
Basic | 21,578,106 | 21,488,216 | 21,564,447 | 21,476,586 | |||||||||||||||||||
Diluted | 21,778,729 | 21,720,497 | 21,799,627 | 21,741,499 |
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
(expressed in thousands of U.S. dollars) | |||||||||||||||||||||||
NET EARNINGS | $ | 645,850 | $ | 126,559 | $ | 892,718 | $ | 730,355 | |||||||||||||||
Other comprehensive income (loss), net of income taxes: | |||||||||||||||||||||||
Unrealized gains (losses) on fixed income available-for-sale investments arising during the period | 21,198 | (267) | 74,969 | 4,640 | |||||||||||||||||||
Reclassification adjustment for change in allowance for credit losses recognized in net earnings | (2,379) | — | 71 | — | |||||||||||||||||||
Reclassification adjustment for net realized losses included in net earnings | (9,488) | (34) | (13,498) | (4,191) | |||||||||||||||||||
Unrealized gains (losses) arising during the period, net of reclassification adjustments | 9,331 | (301) | 61,542 | 449 | |||||||||||||||||||
Cumulative currency translation adjustment | 1,891 | (2,551) | — | (4,390) | |||||||||||||||||||
Increase in defined benefit pension liability | — | (952) | — | (952) | |||||||||||||||||||
Total other comprehensive income (loss) | 11,222 | (3,804) | 61,542 | (4,893) | |||||||||||||||||||
Comprehensive income | 657,072 | 122,755 | 954,260 | 725,462 | |||||||||||||||||||
Comprehensive (income) loss attributable to noncontrolling interest | (22,546) | 206 | 23,962 | 4,912 | |||||||||||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO ENSTAR | $ | 634,526 | $ | 122,961 | $ | 978,222 | $ | 730,374 |
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
(expressed in thousands of U.S. dollars) | |||||||||||||||||||||||
Share Capital — Voting Ordinary Shares | |||||||||||||||||||||||
Balance, beginning of period | $ | 18,635 | $ | 17,975 | $ | 18,002 | $ | 17,950 | |||||||||||||||
Issue of shares | 6 | 6 | 732 | 31 | |||||||||||||||||||
Shares repurchased | (81) | — | (174) | — | |||||||||||||||||||
Balance, end of period | $ | 18,560 | $ | 17,981 | $ | 18,560 | $ | 17,981 | |||||||||||||||
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 and 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 and 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 | $ | 110,000 | $ | 110,000 | |||||||||||||||
Treasury Shares (Series C Preferred Shares) | |||||||||||||||||||||||
Balance, beginning and end of period | $ | (421,559) | $ | (421,559) | $ | (421,559) | $ | (421,559) | |||||||||||||||
Joint Share Ownership Plan — Voting Ordinary Shares, Held in Trust | |||||||||||||||||||||||
Balance, beginning of period | $ | (566) | $ | — | $ | — | $ | — | |||||||||||||||
Issue of shares | — | — | (566) | — | |||||||||||||||||||
Balance, end of period | $ | (566) | $ | — | $ | (566) | $ | — | |||||||||||||||
Additional Paid-in Capital | |||||||||||||||||||||||
Balance, beginning of period | $ | 1,835,115 | $ | 1,822,202 | $ | 1,836,778 | $ | 1,804,664 | |||||||||||||||
Issue of voting ordinary shares | 503 | 576 | (857) | 1,497 | |||||||||||||||||||
Shares repurchased | (12,782) | — | (25,215) | — | |||||||||||||||||||
Amortization of share-based compensation | 9,294 | 7,729 | 21,424 | 24,346 | |||||||||||||||||||
Balance, end of period | $ | 1,832,130 | $ | 1,830,507 | $ | 1,832,130 | $ | 1,830,507 | |||||||||||||||
Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||||||||
Balance, beginning of period | $ | 51,285 | $ | 9,196 | $ | 7,171 | $ | 10,440 | |||||||||||||||
Currency translation adjustment | |||||||||||||||||||||||
Balance, beginning of period | 6,824 | 9,147 | 8,548 | 10,986 | |||||||||||||||||||
Change in currency translation adjustment | 2,477 | (2,560) | 753 | (4,399) | |||||||||||||||||||
Balance, end of period | 9,301 | 6,587 | 9,301 | 6,587 | |||||||||||||||||||
Defined benefit pension liability | |||||||||||||||||||||||
Balance, beginning of period | (945) | (987) | (945) | (987) | |||||||||||||||||||
Change in defined benefit pension liability | — | (951) | — | (951) | |||||||||||||||||||
Balance, beginning and end of period | (945) | (1,938) | (945) | (1,938) | |||||||||||||||||||
Unrealized gains (losses) on available-for-sale investments | |||||||||||||||||||||||
Balance, beginning of period | 45,406 | 1,036 | (432) | 441 | |||||||||||||||||||
Change in unrealized gains (losses) on available-for-sale investments | 8,111 | (195) | 53,949 | 400 | |||||||||||||||||||
Balance, end of period | 53,517 | 841 | 53,517 | 841 | |||||||||||||||||||
Balance, end of period | $ | 61,873 | $ | 5,490 | $ | 61,873 | $ | 5,490 | |||||||||||||||
Retained Earnings | |||||||||||||||||||||||
Balance, beginning of period | $ | 3,190,104 | $ | 2,573,117 | $ | 2,887,892 | $ | 1,976,539 | |||||||||||||||
Net earnings | 645,850 | 126,559 | 892,718 | 730,355 | |||||||||||||||||||
Net (earnings) loss attributable to noncontrolling interest | (21,912) | 109 | 30,802 | 4,970 | |||||||||||||||||||
Dividends on preferred shares | (8,925) | (8,925) | (26,775) | (26,989) | |||||||||||||||||||
Change in redemption value of redeemable noncontrolling interests | 11,431 | 622 | 38,059 | 6,607 | |||||||||||||||||||
Cumulative effect of change in accounting principle | — | — | (6,148) | — | |||||||||||||||||||
Balance, end of period | $ | 3,816,548 | $ | 2,691,482 | $ | 3,816,548 | $ | 2,691,482 | |||||||||||||||
Noncontrolling Interest (excludes Redeemable Noncontrolling Interest) | |||||||||||||||||||||||
Balance, beginning of period | $ | 13,553 | $ | 12,609 | $ | 14,168 | $ | 12,056 | |||||||||||||||
Purchase of noncontrolling shareholders' interest in subsidiaries | — | — | — | (47) | |||||||||||||||||||
Net earnings (loss) attributable to noncontrolling interest | 915 | 81 | 300 | 681 | |||||||||||||||||||
Balance, end of period | $ | 14,468 | $ | 12,690 | $ | 14,468 | $ | 12,690 | |||||||||||||||
Total Shareholders' Equity | $ | 5,835,353 | $ | 4,650,490 | $ | 5,835,353 | $ | 4,650,490 |
Nine Months Ended September 30, | |||||||||||
2020 | 2019 | ||||||||||
(expressed in thousands of U.S. dollars) | |||||||||||
OPERATING ACTIVITIES: | |||||||||||
Net earnings | $ | 892,718 | $ | 730,355 | |||||||
Net earnings from discontinued operations, net of income taxes | (810) | (12,041) | |||||||||
Adjustments to reconcile net earnings to cash flows provided by operating activities: | |||||||||||
Realized gains on sale of investments | (114,894) | (49,243) | |||||||||
Unrealized gains on investments | (723,658) | (809,246) | |||||||||
Depreciation and other amortization | 42,210 | 23,652 | |||||||||
Earnings from equity method investments | (152,725) | (44,188) | |||||||||
Sales and maturities of trading securities | 2,778,993 | 4,133,200 | |||||||||
Purchases of trading securities | (1,531,190) | (3,876,661) | |||||||||
Other non-cash items | 20,847 | 26,098 | |||||||||
Changes in: | |||||||||||
Reinsurance balances recoverable on paid and unpaid losses | 266,289 | (207,579) | |||||||||
Funds held by reinsured companies | (211,850) | (48,814) | |||||||||
Losses and loss adjustment expenses | 697,516 | 474,707 | |||||||||
Defendant asbestos and environmental liabilities | (93,648) | (22,957) | |||||||||
Insurance and reinsurance balances payable | 172,358 | 38,382 | |||||||||
Unearned premiums | (106,748) | (21,999) | |||||||||
Premiums receivable | (18,950) | 195,751 | |||||||||
Other operating assets and liabilities | 187,572 | (99,849) | |||||||||
Net cash flows provided by operating activities | 2,104,030 | 429,568 | |||||||||
INVESTING ACTIVITIES: | |||||||||||
Sales and maturities of available-for-sale securities | 1,673,800 | 100,154 | |||||||||
Purchase of available-for-sale securities | (3,125,184) | (363,221) | |||||||||
Purchase of other investments | (812,586) | (731,588) | |||||||||
Proceeds from other investments | 282,330 | 460,554 | |||||||||
Purchase of equity method investments | (33,000) | (38,403) | |||||||||
Other investing activities | 3,606 | (1,204) | |||||||||
Net cash flows used in investing activities | (2,011,034) | (573,708) | |||||||||
FINANCING ACTIVITIES: | |||||||||||
Dividends on preferred shares | (26,775) | (26,989) | |||||||||
Dividends paid to redeemable noncontrolling interest | — | (11,556) | |||||||||
Purchase of noncontrolling shareholders' interest in subsidiaries | — | (47) | |||||||||
Repurchase of shares | (25,390) | — | |||||||||
Receipt of loans | 858,788 | 1,070,808 | |||||||||
Repayment of loans | (604,000) | (722,574) | |||||||||
Net cash flows provided by financing activities | 202,623 | 309,642 | |||||||||
DISCONTINUED OPERATIONS CASH FLOWS: | |||||||||||
Net cash flows provided by operating activities | 114,024 | 210,666 | |||||||||
Net cash flows used in investing activities | (134,759) | (5,332) | |||||||||
Net cash flows from discontinued operations | (20,735) | 205,334 | |||||||||
EFFECT OF EXCHANGE RATE CHANGES ON FOREIGN CURRENCY CASH AND CASH EQUIVALENTS | 1,727 | (12,507) | |||||||||
NET INCREASE IN CASH AND CASH EQUIVALENTS | 276,611 | 358,329 | |||||||||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 971,349 | 901,996 | |||||||||
NET CHANGE IN CASH OF BUSINESSES HELD FOR SALE | (50,638) | (205,333) | |||||||||
CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | 1,197,322 | $ | 1,054,992 | |||||||
Supplemental Cash Flow Information: | |||||||||||
Income taxes paid, net of refunds | $ | 15,870 | $ | (271) | |||||||
Interest paid | $ | 37,275 | $ | 33,742 | |||||||
Reconciliation to Consolidated Balance Sheets: | |||||||||||
Cash and cash equivalents | 640,601 | 557,677 | |||||||||
Restricted cash and cash equivalents | 556,721 | 497,315 | |||||||||
Cash, cash equivalents and restricted cash | $ | 1,197,322 | $ | 1,054,992 |
September 30, 2020 |
December 31, 2019 (1)
|
||||||||||
ASSETS | |||||||||||
Fixed maturities, trading, at fair value | $ | 140,124 | $ | 202,994 | |||||||
Fixed maturities, available-for-sale, at fair value | 525,842 | 375,337 | |||||||||
Equities, at fair value | 5,494 | 3,000 | |||||||||
Other investments, at fair value | 6,864 | 6,389 | |||||||||
Total investments | 678,324 | 587,720 | |||||||||
Cash and cash equivalents | 54,303 | 78,613 | |||||||||
Restricted cash and cash equivalents | 9,390 | 5,815 | |||||||||
Premiums receivable | 105,339 | 99,367 | |||||||||
Deferred tax assets | 14,890 | 15,191 | |||||||||
Reinsurance balances recoverable on paid and unpaid losses | 477,739 | 530,604 | |||||||||
Funds held by reinsured companies | 29,678 | 35,861 | |||||||||
Deferred acquisition costs | 32,071 | 36,992 | |||||||||
Goodwill and intangible assets | 24,900 | 24,900 | |||||||||
Other assets | 78,876 | 59,707 | |||||||||
TOTAL ASSETS HELD-FOR-SALE | $ | 1,505,510 | $ | 1,474,770 | |||||||
LIABILITIES | |||||||||||
Losses and loss adjustment expenses | $ | 830,456 | $ | 836,761 | |||||||
Unearned premiums | 217,375 | 218,166 | |||||||||
Insurance and reinsurance balances payable | 49,822 | 22,453 | |||||||||
Other liabilities | 124,604 | 131,151 | |||||||||
TOTAL LIABILITIES HELD-FOR-SALE | $ | 1,222,257 | $ | 1,208,531 | |||||||
NET ASSETS HELD-FOR-SALE | $ | 283,253 | $ | 266,239 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
INCOME | |||||||||||||||||||||||
Net premiums earned | $ | 75,414 | $ | 94,523 | $ | 241,363 | $ | 263,464 | |||||||||||||||
Fees and commission income | — | 150 | — | 515 | |||||||||||||||||||
Net investment income | 3,649 | 3,970 | 11,063 | 11,831 | |||||||||||||||||||
Net realized and unrealized gains | 1,910 | 3,125 | 2,757 | 20,198 | |||||||||||||||||||
Other income | 55 | 4 | 80 | 10 | |||||||||||||||||||
81,028 | 101,772 | 255,263 | 296,018 | ||||||||||||||||||||
EXPENSES | |||||||||||||||||||||||
Net incurred losses and loss adjustment expenses | 44,939 | 59,159 | 157,648 | 185,048 | |||||||||||||||||||
Acquisition costs | 14,776 | 16,972 | 47,570 | 48,733 | |||||||||||||||||||
General and administrative expenses | 16,675 | 16,558 | 47,404 | 47,213 | |||||||||||||||||||
Interest expense | 535 | — | 1,715 | 1,355 | |||||||||||||||||||
Net foreign exchange (gains) losses | (3) | 34 | (5) | 29 | |||||||||||||||||||
76,922 | 92,723 | 254,332 | 282,378 | ||||||||||||||||||||
EARNINGS (LOSS) BEFORE INCOME TAXES | 4,106 | 9,049 | 931 | 13,640 | |||||||||||||||||||
Income tax benefit (expense) | (75) | (1,133) | (121) | (1,599) | |||||||||||||||||||
NET EARNINGS (LOSS) FROM DISCONTINUED OPERATIONS, NET OF INCOME TAXES | $ | 4,031 | $ | 7,916 | $ | 810 | $ | 12,041 | |||||||||||||||
Net loss (earnings) from discontinued operations attributable to noncontrolling interest | (1,654) | (3,247) | (332) | (4,939) | |||||||||||||||||||
NET EARNINGS (LOSS) FROM DISCONTINUED OPERATIONS ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | 2,377 | $ | 4,669 | $ | 478 | $ | 7,102 |
Nine Months Ended September 30, | |||||||||||
2020 | 2019 | ||||||||||
Operating activities | $ | 114,024 | $ | 210,666 | |||||||
Investing activities | (134,759) | (5,332) | |||||||||
Change in cash and restricted cash of business held-for-sale | $ | (20,735) | $ | 205,334 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Total income | $ | 1,709 | $ | 3,373 | $ | 9,072 | $ | 8,082 | |||||||||||||||
Total expenses (income) | (1,783) | (4,582) | (16,682) | 41,884 | |||||||||||||||||||
Net earnings (loss) | $ | 3,492 | $ | 7,955 | $ | 25,754 | $ | (33,802) |
September 30, 2020 | |||||||||||
Assets held-for-sale: | |||||||||||
Northshore (Atrium and Arden Re) | $ | 650,978 | |||||||||
StarStone U.S. | 1,505,510 | ||||||||||
Total | $ | 2,156,488 | |||||||||
Liabilities held-for-sale: | |||||||||||
Northshore (Atrium and Arden Re) | $ | 431,086 | |||||||||
StarStone U.S. | 1,222,257 | ||||||||||
Total | $ | 1,653,343 |
September 30, 2020 | |||||||||||||||||||||||||||||||||||
Short-term investments, trading | Short-term investments, AFS | Fixed maturities, trading | Fixed maturities, AFS | Fixed maturities, funds held - directly managed | Total | ||||||||||||||||||||||||||||||
U.S. government and agency | $ | 3,399 | $ | 252,449 | $ | 148,378 | $ | 298,140 | $ | 87,264 | $ | 789,630 | |||||||||||||||||||||||
U.K. government | — | — | 71,803 | 42,974 | — | 114,777 | |||||||||||||||||||||||||||||
Other government | 2,872 | — | 327,406 | 136,130 | 24,039 | 490,447 | |||||||||||||||||||||||||||||
Corporate | 862 | 25,726 | 3,474,857 | 1,653,722 | 524,742 | 5,679,909 | |||||||||||||||||||||||||||||
Municipal | — | — | 79,296 | 30,806 | 51,737 | 161,839 | |||||||||||||||||||||||||||||
Residential mortgage-backed | — | — | 157,773 | 293,811 | 77,655 | 529,239 | |||||||||||||||||||||||||||||
Commercial mortgage-backed | — | — | 382,735 | 228,207 | 232,177 | 843,119 | |||||||||||||||||||||||||||||
Asset-backed | — | — | 357,394 | 199,682 | 56,587 | 613,663 | |||||||||||||||||||||||||||||
Total fixed maturity and short-term investments | $ | 7,133 | $ | 278,175 | $ | 4,999,642 | $ | 2,883,472 | $ | 1,054,201 | $ | 9,222,623 |
December 31, 2019 | |||||||||||||||||||||||||||||||||||
Short-term investments, trading | Short-term investments, AFS | Fixed maturities, trading | Fixed maturities, AFS | Fixed maturities, funds held - directly managed | Total | ||||||||||||||||||||||||||||||
U.S. government and agency | $ | — | $ | 111,583 | $ | 208,296 | $ | 269,661 | $ | 106,537 | $ | 696,077 | |||||||||||||||||||||||
U.K. government | 24,411 | 1,069 | 122,012 | 14,280 | — | 161,772 | |||||||||||||||||||||||||||||
Other government | 21,958 | 387 | 575,017 | 84,760 | 20,734 | 702,856 | |||||||||||||||||||||||||||||
Corporate | 5,121 | 13,915 | 3,959,288 | 866,557 | 603,389 | 5,448,270 | |||||||||||||||||||||||||||||
Municipal | — | 1,381 | 87,451 | 2,399 | 49,456 | 140,687 | |||||||||||||||||||||||||||||
Residential mortgage-backed | — | — | 215,521 | 99,188 | 86,205 | 400,914 | |||||||||||||||||||||||||||||
Commercial mortgage-backed | — | — | 534,357 | 49,046 | 230,343 | 813,746 | |||||||||||||||||||||||||||||
Asset-backed | — | — | 441,393 | 152,161 | 76,681 | 670,235 | |||||||||||||||||||||||||||||
Total fixed maturity and short-term investments | $ | 51,490 | $ | 128,335 | $ | 6,143,335 | $ | 1,538,052 | $ | 1,173,345 | $ | 9,034,557 |
As of September 30, 2020 |
Amortized
Cost |
Fair Value |
% of Total
Fair Value |
|||||||||||||||||
One year or less | $ | 556,125 | $ | 559,086 | 6.1 | % | ||||||||||||||
More than one year through two years | 589,231 | 598,559 | 6.5 | % | ||||||||||||||||
More than two years through five years | 2,080,715 | 2,163,967 | 23.5 | % | ||||||||||||||||
More than five years through ten years | 2,010,769 | 2,149,170 | 23.3 | % | ||||||||||||||||
More than ten years | 1,595,695 | 1,765,820 | 19.1 | % | ||||||||||||||||
Residential mortgage-backed | 521,383 | 529,239 | 5.7 | % | ||||||||||||||||
Commercial mortgage-backed | 821,995 | 843,119 | 9.1 | % | ||||||||||||||||
Asset-backed | 631,133 | 613,663 | 6.7 | % | ||||||||||||||||
$ | 8,807,046 | $ | 9,222,623 | 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 | $ | 769,544 | $ | 789,630 | 8.6 | % | $ | 789,630 | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||||||
U.K. government | 111,169 | 114,777 | 1.2 | % | — | 102,624 | 8,739 | — | — | 3,414 | |||||||||||||||||||||||||||||||||||||||||||
Other government | 466,575 | 490,447 | 5.3 | % | 242,097 | 150,005 | 43,003 | 45,884 | 9,458 | — | |||||||||||||||||||||||||||||||||||||||||||
Corporate | 5,339,160 | 5,679,909 | 61.6 | % | 206,345 | 583,595 | 2,704,861 | 1,912,857 | 267,765 | 4,486 | |||||||||||||||||||||||||||||||||||||||||||
Municipal | 146,087 | 161,839 | 1.8 | % | 7,137 | 83,519 | 51,538 | 19,645 | — | — | |||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed | 521,383 | 529,239 | 5.7 | % | 517,915 | — | 2,154 | 1,612 | 5,251 | 2,307 | |||||||||||||||||||||||||||||||||||||||||||
Commercial mortgage-backed | 821,995 | 843,119 | 9.1 | % | 576,643 | 111,720 | 77,391 | 64,898 | 5,308 | 7,159 | |||||||||||||||||||||||||||||||||||||||||||
Asset-backed | 631,133 | 613,663 | 6.7 | % | 249,237 | 99,942 | 145,494 | 96,960 | 21,780 | 250 | |||||||||||||||||||||||||||||||||||||||||||
Total | $ | 8,807,046 | $ | 9,222,623 | 100.0 | % | $ | 2,589,004 | $ | 1,131,405 | $ | 3,033,180 | $ | 2,141,856 | $ | 309,562 | $ | 17,616 | |||||||||||||||||||||||||||||||||||
% of total fair value | 28.1 | % | 12.3 | % | 32.9 | % | 23.2 | % | 3.3 | % | 0.2 | % |
Gross Unrealized Losses | ||||||||||||||||||||||||||||||||
As of September 30, 2020 | Amortized Cost | Gross Unrealized Gains | Non-Credit Related Losses |
Allowance for Credit Losses(1)
|
Fair Value | |||||||||||||||||||||||||||
U.S. government and agency | $ | 546,799 | $ | 4,071 | $ | (281) | $ | — | $ | 550,589 | ||||||||||||||||||||||
U.K. government | 42,025 | 995 | (46) | — | 42,974 | |||||||||||||||||||||||||||
Other government | 131,861 | 4,279 | (10) | — | 136,130 | |||||||||||||||||||||||||||
Corporate | 1,646,014 | 40,601 | (6,383) | (784) | 1,679,448 | |||||||||||||||||||||||||||
Municipal | 29,810 | 1,012 | (16) | — | 30,806 | |||||||||||||||||||||||||||
Residential mortgage-backed | 292,153 | 2,211 | (551) | (2) | 293,811 | |||||||||||||||||||||||||||
Commercial mortgage-backed | 226,292 | 4,347 | (2,351) | (81) | 228,207 | |||||||||||||||||||||||||||
Asset-backed | 200,626 | 642 | (1,541) | (45) | 199,682 | |||||||||||||||||||||||||||
$ | 3,115,580 | $ | 58,158 | $ | (11,179) | $ | (912) | $ | 3,161,647 |
As of December 31, 2019 | Amortized Cost | Gross Unrealized Gains |
Gross Unrealized Losses
(Non-OTTI) |
Fair Value | ||||||||||||||||||||||||||||
U.S. government and agency | $ | 381,488 | $ | 78 | $ | (322) | $ | 381,244 | ||||||||||||||||||||||||
U.K. government | 15,067 | 282 | — | 15,349 | ||||||||||||||||||||||||||||
Other government | 84,116 | 1,119 | (88) | 85,147 | ||||||||||||||||||||||||||||
Corporate | 880,667 | 3,739 | (3,934) | 880,472 | ||||||||||||||||||||||||||||
Municipal | 3,770 | 12 | (2) | 3,780 | ||||||||||||||||||||||||||||
Residential mortgage-backed | 99,646 | 221 | (679) | 99,188 | ||||||||||||||||||||||||||||
Commercial mortgage-backed | 49,219 | 30 | (203) | 49,046 | ||||||||||||||||||||||||||||
Asset-backed | 152,153 | 127 | (119) | 152,161 | ||||||||||||||||||||||||||||
$ | 1,666,126 | $ | 5,608 | $ | (5,347) | $ | 1,666,387 |
12 Months or Greater | Less Than 12 Months | Total | ||||||||||||||||||||||||||||||||||||
As of September 30, 2020 |
Fair
Value |
Gross Unrealized
Losses |
Fair
Value |
Gross Unrealized
Losses |
Fair
Value |
Gross Unrealized
Losses |
||||||||||||||||||||||||||||||||
U.S. government and agency | $ | — | $ | — | $ | 170,590 | $ | (281) | $ | 170,590 | $ | (281) | ||||||||||||||||||||||||||
U.K. government | — | — | 2,911 | (46) | 2,911 | (46) | ||||||||||||||||||||||||||||||||
Other government | — | — | 7,392 | (10) | 7,392 | (10) | ||||||||||||||||||||||||||||||||
Corporate | — | — | 498,974 | (5,585) | 498,974 | (5,585) | ||||||||||||||||||||||||||||||||
Municipal | — | — | 3,551 | (16) | 3,551 | (16) | ||||||||||||||||||||||||||||||||
Residential mortgage-backed | — | — | 136,602 | (383) | 136,602 | (383) | ||||||||||||||||||||||||||||||||
Commercial mortgage-backed | — | — | 69,226 | (1,652) | 69,226 | (1,652) | ||||||||||||||||||||||||||||||||
Asset-backed | — | — | 135,857 | (1,386) | 135,857 | (1,386) | ||||||||||||||||||||||||||||||||
Total fixed maturity and short-term investments | $ | — | $ | — | $ | 1,025,103 | $ | (9,359) | $ | 1,025,103 | $ | (9,359) |
12 Months or Greater | Less Than 12 Months | Total | ||||||||||||||||||||||||||||||||||||
As of December 31, 2019 |
Fair
Value |
Gross Unrealized
Losses |
Fair
Value |
Gross Unrealized
Losses |
Fair
Value |
Gross Unrealized
Losses |
||||||||||||||||||||||||||||||||
U.S. government and agency | $ | — | $ | — | $ | 193,574 | $ | (322) | $ | 193,574 | $ | (322) | ||||||||||||||||||||||||||
Other government | 1,080 | (23) | 37,796 | (65) | 38,876 | (88) | ||||||||||||||||||||||||||||||||
Corporate | 2,754 | (306) | 338,965 | (3,628) | 341,719 | (3,934) | ||||||||||||||||||||||||||||||||
Municipal | 128 | — | 761 | (2) | 889 | (2) | ||||||||||||||||||||||||||||||||
Residential mortgage-backed | — | — | 52,005 | (679) | 52,005 | (679) | ||||||||||||||||||||||||||||||||
Commercial mortgage-backed | — | — | 35,777 | (203) | 35,777 | (203) | ||||||||||||||||||||||||||||||||
Asset-backed | — | — | 101,591 | (119) | 101,591 | (119) | ||||||||||||||||||||||||||||||||
Total fixed maturity and short-term investments | $ | 3,962 | $ | (329) | $ | 760,469 | $ | (5,018) | $ | 764,431 | $ | (5,347) |
Three Months Ended September 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Other
government |
Corporate | Residential mortgage-backed |
Commercial
mortgage backed |
Asset-backed | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses, beginning of period | $ | — | $ | (3,090) | $ | — | $ | (494) | $ | (89) | $ | (3,673) | |||||||||||||||||||||||||||||||||||||||||
Cumulative effect of change in accounting principle | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Allowances for credit losses on securities for which credit losses were not previously recorded | — | (39) | (2) | (78) | (45) | (164) | |||||||||||||||||||||||||||||||||||||||||||||||
Additions to the allowance for credit losses arising from purchases of securities accounted for as PCD assets | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Reductions for securities sold during the period | — | 341 | — | — | — | 341 | |||||||||||||||||||||||||||||||||||||||||||||||
Reductions in the allowance for credit losses on securities we either intend to sell or more likely than not, we will be required to sell before the recovery of their amortized cost basis | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
(Increase) decrease to the allowance for credit losses on securities that had an allowance recorded in the previous period | — | 2,004 | — | 491 | 89 | 2,584 | |||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses, end of period | $ | — | $ | (784) | $ | (2) | $ | (81) | $ | (45) | $ | (912) |
Nine Months Ended September 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Other
government |
Corporate | Residential mortgage-backed |
Commercial
mortgage backed |
Asset-backed | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses, beginning of period | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||||||||||||
Cumulative effect of change in accounting principle | (22) | (2,987) | — | (50) | — | (3,059) | |||||||||||||||||||||||||||||||||||||||||||||||
Allowances for credit losses on securities for which credit losses were not previously recorded | — | (10,359) | (2) | (572) | (134) | (11,067) | |||||||||||||||||||||||||||||||||||||||||||||||
Additions to the allowance for credit losses arising from purchases of securities accounted for as PCD assets | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Reductions for securities sold during the period | 22 | 2,108 | — | — | — | 2,130 | |||||||||||||||||||||||||||||||||||||||||||||||
Reductions in the allowance for credit losses on securities we either intend to sell or more likely than not, we will be required to sell before the recovery of their amortized cost basis | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
(Increase) decrease to the allowance for credit losses on securities that had an allowance recorded in the previous period | — | 10,454 | — | 541 | 89 | 11,084 | |||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses, end of period | $ | — | $ | (784) | $ | (2) | $ | (81) | $ | (45) | $ | (912) |
September 30, 2020 | December 31, 2019 | ||||||||||
Publicly traded equity investments in common and preferred stocks | $ | 303,932 | $ | 327,875 | |||||||
Exchange-traded funds | 78,182 | 133,047 | |||||||||
Privately held equity investments in common and preferred stocks | 271,045 | 265,799 | |||||||||
$ | 653,159 | $ | 726,721 |
September 30, 2020 | December 31, 2019 | |||||||||||||
Hedge funds | $ | 2,087,091 | $ | 1,121,904 | ||||||||||
Fixed income funds | 684,031 | 481,039 | ||||||||||||
Equity funds | 290,129 | 410,149 | ||||||||||||
Private equity funds | 320,455 | 323,496 | ||||||||||||
CLO equities | 84,532 | 87,555 | ||||||||||||
CLO equity funds | 140,458 | 87,509 | ||||||||||||
Private credit funds | 90,476 | — | ||||||||||||
Other | 7,698 | 6,379 | ||||||||||||
$ | 3,704,870 | $ | 2,518,031 |
Less than 1 Year | 1-2 years | 2-3 years | Not Eligible/ Restricted | Total | Redemption Frequency | ||||||||||||||||||||||||||||||||||||
Hedge funds | $ | 793,268 | $ | 1,131,505 | $ | 102,600 | $ | 59,718 | $ | 2,087,091 | Monthly to Bi-annually | ||||||||||||||||||||||||||||||
Fixed income funds | 671,333 | — | — | 12,698 | 684,031 | Daily to Quarterly | |||||||||||||||||||||||||||||||||||
Equity funds | 290,129 | — | — | — | 290,129 | Daily to Quarterly | |||||||||||||||||||||||||||||||||||
Private equity funds | — | — | — | 320,455 | 320,455 | N/A | |||||||||||||||||||||||||||||||||||
CLO equities | 84,532 | — | — | — | 84,532 | N/A | |||||||||||||||||||||||||||||||||||
CLO equity funds | 101,597 | 29,113 | 9,748 | — | 140,458 | Quarterly to Bi-annually | |||||||||||||||||||||||||||||||||||
Private credit funds | — | 10,000 | 80,476 | 90,476 | N/A | ||||||||||||||||||||||||||||||||||||
Other | 7,698 | 7,698 | N/A | ||||||||||||||||||||||||||||||||||||||
$ | 1,940,859 | $ | 1,170,618 | $ | 112,348 | $ | 481,045 | $ | 3,704,870 |
September 30, 2020 | December 31, 2019 | |||||||||||||||||||||||||||||||||||||
Investment | Ownership % | Carrying Value | Investment | Ownership % | Carrying Value | |||||||||||||||||||||||||||||||||
Enhanzed Re | $ | 154,050 | 47.4 | % | $ | 271,678 | $ | 154,050 | 47.4 | % | $ | 182,856 | ||||||||||||||||||||||||||
Citco | 50,000 | 31.9 | % | 51,946 | 50,000 | 31.9 | % | 51,742 | ||||||||||||||||||||||||||||||
Monument Re (1)
|
59,600 | 20.0 | % | 161,994 | 26,600 | 20.0 | % | 60,598 | ||||||||||||||||||||||||||||||
Clear Spring | 11,210 | 20.0 | % | 10,944 | 11,210 | 20.0 | % | 10,645 | ||||||||||||||||||||||||||||||
Other | 24,963 |
~30%
|
20,233 | 24,963 |
~30%
|
20,436 | ||||||||||||||||||||||||||||||||
$ | 299,823 | $ | 516,795 | $ | 266,823 | $ | 326,277 |
September 30, 2020 | December 31, 2019 | ||||||||||
Fixed maturity investments, trading | $ | 1,054,201 | $ | 1,173,345 | |||||||
Cash and cash equivalents | 6,432 | 10,296 | |||||||||
Other assets | 6,006 | 3,911 | |||||||||
$ | 1,066,639 | $ | 1,187,552 |
September 30, 2020 | December 31, 2019 | ||||||||||||||||||||||||||||||||||
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 | $ | 106,768 | $ | 861,511 | $ | 968,279 | $ | 185,859 | $ | 940,194 | $ | 1,126,053 | |||||||||||||||||||||||
Net unrealized gains (losses): | |||||||||||||||||||||||||||||||||||
Change in fair value - fair value option accounting | 9,077 | — | 9,077 | 5,438 | — | 5,438 | |||||||||||||||||||||||||||||
Change in fair value - embedded derivative accounting | — | 76,845 | 76,845 | — | 41,854 | 41,854 | |||||||||||||||||||||||||||||
Fixed maturity investments within funds held - directly managed, at fair value | $ | 115,845 | $ | 938,356 | $ | 1,054,201 | $ | 191,297 | $ | 982,048 | $ | 1,173,345 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Fixed maturity investments | $ | 47,275 | $ | 54,085 | $ | 153,554 | $ | 163,246 | |||||||||||||||
Short-term investments and cash and cash equivalents | 826 | 3,526 | 4,203 | 11,430 | |||||||||||||||||||
Funds held | 8,346 | 10,091 | 32,715 | 18,901 | |||||||||||||||||||
Funds held - directly managed | 7,703 | 9,381 | 27,204 | 28,742 | |||||||||||||||||||
Investment income from fixed maturities and cash and cash equivalents | 64,150 | 77,083 | 217,676 | 222,319 | |||||||||||||||||||
Equity investments | 4,771 | 4,416 | 14,496 | 11,218 | |||||||||||||||||||
Other investments | 6,000 | 2,642 | 19,384 | 7,259 | |||||||||||||||||||
Investment income from equities and other investments | 10,771 | 7,058 | 33,880 | 18,477 | |||||||||||||||||||
Gross investment income | 74,921 | 84,141 | 251,556 | 240,796 | |||||||||||||||||||
Investment expenses | (2,791) | (2,639) | (10,269) | (9,372) | |||||||||||||||||||
Net investment income | $ | 72,130 | $ | 81,502 | $ | 241,287 | $ | 231,424 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||||||||||||
Net realized gains (losses) on sale: | ||||||||||||||||||||||||||
Gross realized gains on fixed maturity securities, AFS | $ | 9,871 | $ | 44 | $ | 19,995 | $ | 4,493 | ||||||||||||||||||
Gross realized losses on fixed maturity securities, AFS | (786) | (10) | (7,379) | (302) | ||||||||||||||||||||||
Credit recoveries (losses) on fixed maturity securities, AFS | 2,248 | — | (389) | — | ||||||||||||||||||||||
Net realized gains on fixed maturity securities, trading | 30,531 | 25,245 | 87,911 | 45,636 | ||||||||||||||||||||||
Net realized gains on funds held - directly managed | 3,292 | 1,991 | 5,545 | 629 | ||||||||||||||||||||||
Net realized gains (losses) on equity investments | 8,286 | (3,881) | 9,165 | (1,213) | ||||||||||||||||||||||
Net realized investment gains (losses) on derivatives | 46 | — | 46 | — | ||||||||||||||||||||||
Total net realized gains on sale | $ | 53,488 | $ | 23,389 | $ | 114,894 | $ | 49,243 | ||||||||||||||||||
Net unrealized gains (losses): | ||||||||||||||||||||||||||
Fixed maturity securities, trading | $ | 14,324 | $ | 86,840 | $ | 58,795 | $ | 413,175 | ||||||||||||||||||
Fixed maturity securities in funds held - directly managed portfolios | 7,814 | 20,895 | 42,619 | 95,124 | ||||||||||||||||||||||
Equity investments | 4,210 | 10,057 | (48,409) | 31,266 | ||||||||||||||||||||||
Other Investments | 420,169 | 3,879 | 670,653 | 269,681 | ||||||||||||||||||||||
Total net unrealized gains | 446,517 | 121,671 | 723,658 | 809,246 | ||||||||||||||||||||||
Net realized and unrealized gains | $ | 500,005 | $ | 145,060 | $ | 838,552 | $ | 858,489 | ||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Included within continuing operations: | |||||||||||||||||||||||
Gross realized gains on fixed maturity securities, AFS | $ | 9,871 | $ | 44 | $ | 19,995 | $ | 4,493 | |||||||||||||||
Gross realized losses on fixed maturity securities, AFS | (786) | (10) | (7,379) | (302) | |||||||||||||||||||
Included within discontinued operations: | |||||||||||||||||||||||
Gross realized gains on fixed maturity securities, AFS | 489 | 12 | 1,025 | 12 | |||||||||||||||||||
Gross realized losses on fixed maturity securities, AFS | (86) | (12) | (143) | (12) | |||||||||||||||||||
Total reclassification adjustment | $ | 9,488 | $ | 34 | $ | 13,498 | $ | 4,191 | |||||||||||||||
Included within continuing operations: | |||||||||||||||||||||||
Credit recoveries (losses) on fixed maturity securities, AFS | $ | 2,248 | $ | — | $ | (389) | $ | — | |||||||||||||||
Included within discontinued operations: | |||||||||||||||||||||||
Credit recoveries (losses) on fixed maturity securities, AFS | 131 | — | 318 | — | |||||||||||||||||||
Total reclassification adjustment | $ | 2,379 | $ | — | $ | (71) | $ | — |
September 30, 2020 | December 31, 2019 | |||||||||||||
Collateral in trust for third party agreements | $ | 5,189,537 | $ | 4,103,847 | ||||||||||
Assets on deposit with regulatory authorities | 276,941 | 309,659 | ||||||||||||
Collateral for secured letter of credit facilities | 121,700 | 132,670 | ||||||||||||
Funds at Lloyd's (1)
|
546,996 | 639,316 | ||||||||||||
$ | 6,135,174 | $ | 5,185,492 |
September 30, 2020 | December 31, 2019 | |||||||||||||||||||||||||||||||||||||
Fair Value | Fair Value | |||||||||||||||||||||||||||||||||||||
Gross Notional Amount | Assets | Liabilities | Gross Notional Amount | Assets | Liabilities | |||||||||||||||||||||||||||||||||
Foreign currency forward - AUD | $ | 68,847 | $ | 282 | $ | — | $ | 64,620 | $ | 52 | $ | 2,033 | ||||||||||||||||||||||||||
Foreign currency forward - EUR | 140,663 | 839 | — | 112,284 | 246 | 1,635 | ||||||||||||||||||||||||||||||||
Foreign currency forward - GBP | 329,245 | 5,664 | — | 318,387 | 344 | 7,784 | ||||||||||||||||||||||||||||||||
Total qualifying hedges | $ | 538,755 | $ | 6,785 | $ | — | $ | 495,291 | $ | 642 | $ | 11,452 |
Amount of Gains (Losses) Deferred in AOCI | ||||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||||||||||||
Foreign currency forward - AUD | $ | (2,813) | $ | 1,673 | $ | (1,777) | $ | 1,819 | ||||||||||||||||||
Foreign currency forward - EUR | (5,525) | 4,780 | (6,001) | 5,076 | ||||||||||||||||||||||
Foreign currency forward - GBP | (11,315) | 8,260 | 10,002 | 6,669 | ||||||||||||||||||||||
Net gains (losses) on qualifying derivative hedges | $ | (19,653) | $ | 14,713 | $ | 2,224 | $ | 13,564 |
September 30, 2020 | December 31, 2019 | |||||||||||||||||||||||||||||||||||||
Fair Value | Fair Value | |||||||||||||||||||||||||||||||||||||
Gross Notional Amount | Assets | Liabilities | Gross Notional Amount | Assets | Liabilities | |||||||||||||||||||||||||||||||||
Foreign currency forward - AUD | $ | 19,076 | $ | 145 | $ | 81 | $ | 913 | $ | 839 | $ | 892 | ||||||||||||||||||||||||||
Foreign currency forward - CAD | 52,212 | 525 | 89 | 66,266 | 10 | 1,482 | ||||||||||||||||||||||||||||||||
Foreign currency forward - EUR | 22,272 | — | 132 | 74,444 | 507 | 1,440 | ||||||||||||||||||||||||||||||||
Foreign currency forward - GBP | 43,254 | 744 | — | 11,940 | 13 | 292 | ||||||||||||||||||||||||||||||||
Total non-qualifying hedges | $ | 136,814 | $ | 1,414 | $ | 302 | $ | 153,563 | $ | 1,369 | $ | 4,106 |
Gains (Losses) on non-qualifying-hedges included in net earnings | ||||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||||||||||||
Foreign currency forward - AUD | $ | 13 | $ | 1,148 | $ | (432) | $ | 1,710 | ||||||||||||||||||
Foreign currency forward - CAD | (1,171) | 1,582 | 1,600 | (910) | ||||||||||||||||||||||
Foreign currency forward - EUR | (817) | 2,473 | 135 | 3,344 | ||||||||||||||||||||||
Foreign currency forward - GBP | (2,219) | 10,659 | (719) | $ | 12,970 | |||||||||||||||||||||
Net gains (losses) on non-qualifying hedges | $ | (4,194) | $ | 15,862 | $ | 584 | $ | 17,114 |
September 30, 2020 | ||||||||||||||||||||
Fair Value | ||||||||||||||||||||
Gross Notional Amount | Assets | Liabilities | ||||||||||||||||||
Credit default swaps | $ | 7,865 | $ | — | $ | 169 | ||||||||||||||
Futures contracts - long positions | 48,051 | 100 | — | |||||||||||||||||
Futures contracts - short positions | (33,318) | — | 85 | |||||||||||||||||
Currency forward contracts - long positions | 1,508 | 12 | — | |||||||||||||||||
Currency forward contracts - short positions | (1,819) | — | 29 | |||||||||||||||||
Total | $ | 22,287 | $ | 112 | $ | 283 |
Three Months Ended September 30, 2020
|
Nine Months Ended September 30, 2020
|
||||||||||||||||||||||
Credit default swaps
|
$ | 106 | $ | 106 | |||||||||||||||||||
Futures contracts
|
(6) | (43) | |||||||||||||||||||||
Currency forward contracts
|
(43) | 123 | |||||||||||||||||||||
Total net gains
|
$ | 57 | $ | 186 |
September 30, 2020 | ||||||||||||||||||||||||||||||||
Non-life
Run-off |
StarStone | Total | ||||||||||||||||||||||||||||||
Recoverable from reinsurers on unpaid: | ||||||||||||||||||||||||||||||||
Outstanding losses | $ | 858,988 | $ | 258,215 | $ | 1,117,203 | ||||||||||||||||||||||||||
IBNR | 439,594 | 143,073 | 582,667 | |||||||||||||||||||||||||||||
ULAE | 7,674 | — | 7,674 | |||||||||||||||||||||||||||||
Fair value adjustments - acquired companies | (11,986) | (1,378) | (13,364) | |||||||||||||||||||||||||||||
Fair value adjustments - fair value option | (27,029) | — | (27,029) | |||||||||||||||||||||||||||||
Total reinsurance reserves recoverable | 1,267,241 | 399,910 | 1,667,151 | |||||||||||||||||||||||||||||
Paid losses recoverable | 136,548 | 77,957 | 214,505 | |||||||||||||||||||||||||||||
Total | $ | 1,403,789 | $ | 477,867 | $ | 1,881,656 | ||||||||||||||||||||||||||
Reconciliation to Consolidated Balance Sheet: | ||||||||||||||||||||||||||||||||
Reinsurance balances recoverable on paid and unpaid losses | $ | 860,628 | $ | 477,867 | $ | 1,338,495 | ||||||||||||||||||||||||||
Reinsurance balances recoverable on paid and unpaid losses - fair value option | 543,161 | — | 543,161 | |||||||||||||||||||||||||||||
Total | $ | 1,403,789 | $ | 477,867 | $ | 1,881,656 | ||||||||||||||||||||||||||
December 31, 2019 | ||||||||||||||||||||||||||||||||
Non-life
Run-off |
Atrium | StarStone | Total | |||||||||||||||||||||||||||||
Recoverable from reinsurers on unpaid: | ||||||||||||||||||||||||||||||||
Outstanding losses | $ | 972,293 | $ | 9,011 | $ | 264,131 | $ | 1,245,435 | ||||||||||||||||||||||||
IBNR | 673,059 | 19,286 | 93,185 | 785,530 | ||||||||||||||||||||||||||||
Fair value adjustments - acquired companies | (13,652) | 519 | (2,122) | (15,255) | ||||||||||||||||||||||||||||
Fair value adjustments - fair value option | (88,086) | — | — | (88,086) | ||||||||||||||||||||||||||||
Total reinsurance reserves recoverable | 1,543,614 | 28,816 | 355,194 | 1,927,624 | ||||||||||||||||||||||||||||
Paid losses recoverable | 181,375 | 1,541 | 70,594 | 253,510 | ||||||||||||||||||||||||||||
Total | $ | 1,724,989 | $ | 30,357 | $ | 425,788 | $ | 2,181,134 | ||||||||||||||||||||||||
Reconciliation to Consolidated Balance Sheet: | ||||||||||||||||||||||||||||||||
Reinsurance balances recoverable on paid and unpaid losses | $ | 1,029,471 | $ | 30,357 | $ | 425,788 | $ | 1,485,616 | ||||||||||||||||||||||||
Reinsurance balances recoverable on paid and unpaid losses - fair value option | 695,518 | — | — | 695,518 | ||||||||||||||||||||||||||||
Total | $ | 1,724,989 | $ | 30,357 | $ | 425,788 | $ | 2,181,134 |
September 30, 2020 | |||||||||||||||||||||||||||||||||||
Non-life
Run-off |
StarStone | Total |
% of
Total |
||||||||||||||||||||||||||||||||
Top 10 reinsurers | $ | 828,479 | $ | 344,444 | $ | 1,172,923 | 62.3 | % | |||||||||||||||||||||||||||
Other reinsurers > $1 million | 556,623 | 132,049 | 688,672 | 36.6 | % | ||||||||||||||||||||||||||||||
Other reinsurers < $1 million | 18,687 | 1,374 | 20,061 | 1.1 | % | ||||||||||||||||||||||||||||||
Total | $ | 1,403,789 | $ | 477,867 | $ | 1,881,656 | 100.0 | % |
December 31, 2019 | |||||||||||||||||||||||||||||||||||
Non-life
Run-off |
Atrium | StarStone | Total |
% of
Total |
|||||||||||||||||||||||||||||||
Top 10 reinsurers | $ | 1,154,110 | $ | 22,051 | $ | 295,443 | $ | 1,471,604 | 67.4 | % | |||||||||||||||||||||||||
Other reinsurers > $1 million | 551,636 | 7,761 | 129,335 | 688,732 | 31.6 | % | |||||||||||||||||||||||||||||
Other reinsurers < $1 million | 19,243 | 545 | 1,010 | 20,798 | 1.0 | % | |||||||||||||||||||||||||||||
Total | $ | 1,724,989 | $ | 30,357 | $ | 425,788 | $ | 2,181,134 | 100.0 | % |
September 30, 2020 | December 31, 2019 | ||||||||||
Information regarding top ten reinsurers: | |||||||||||
Number of top 10 reinsurers rated A- or better | 8 | 8 | |||||||||
Number of top 10 non-rated reinsurers (1)
|
2 | 2 | |||||||||
Reinsurers rated A- or better in top 10 | $ | 910,751 | $ | 1,199,479 | |||||||
Non-rated reinsurers in top 10 (1)
|
262,172 | 272,125 | |||||||||
Total top 10 reinsurance recoverables | $ | 1,172,923 | $ | 1,471,604 | |||||||
Single reinsurers that represent 10% or more of total reinsurance balance recoverables as of September 30, 2020: | |||||||||||
Hannover Ruck SE (2)
|
$ | — | $ | 259,077 | |||||||
Lloyd's Syndicates (3)
|
$ | 346,601 | $ | 396,246 |
September 30, 2020 | |||||||||||||||||||||||
Gross | Allowance for estimated uncollectible reinsurance | Net |
Provisions as a
% of Gross |
||||||||||||||||||||
Reinsurers rated A- or above | $ | 1,429,984 | $ | 57,465 | $ | 1,372,519 | 4.0 | % | |||||||||||||||
Reinsurers rated below A-, secured | 419,431 | — | 419,431 | — | % | ||||||||||||||||||
Reinsurers rated below A-, unsecured | 167,358 | 77,652 | 89,706 | 46.4 | % | ||||||||||||||||||
Total | $ | 2,016,773 | $ | 135,117 | $ | 1,881,656 | 6.7 | % |
December 31, 2019 | |||||||||||||||||||||||||||||
Gross | Allowance for estimated uncollectible reinsurance | Net |
Provisions as a
% of Gross |
||||||||||||||||||||||||||
Reinsurers rated A- or above | $ | 1,731,270 | $ | 43,427 | $ | 1,687,843 | 2.5 | % | |||||||||||||||||||||
Reinsurers rated below A-, secured | 463,840 | — | 463,840 | — | % | ||||||||||||||||||||||||
Reinsurers rated below A-, unsecured | 133,663 | 104,212 | 29,451 | 78.0 | % | ||||||||||||||||||||||||
Total | $ | 2,328,773 | $ | 147,639 | $ | 2,181,134 | 6.3 | % |
Three Months Ended | Nine Months Ended | ||||||||||
September 30, 2020 | September 30, 2020 | ||||||||||
Allowance for estimated uncollectible reinsurance, beginning of period | $ | 143,653 | $ | 147,639 | |||||||
Cumulative effect of change in accounting principle | — | (195) | |||||||||
Effect of exchange rate movement | 745 | (701) | |||||||||
Current period change in the allowance | 815 | (718) | |||||||||
Write-offs charged against the allowance | (9,625) | (10,225) | |||||||||
Recoveries collected | (471) | (683) | |||||||||
Allowance for estimated uncollectible reinsurance, end of period | $ | 135,117 | $ | 135,117 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Beginning carrying value | $ | 258,516 | $ | 99,094 | $ | 272,462 | $ | 86,585 | |||||||||||||||
Recorded during the period | — | 85,183 | 11,746 | 108,689 | |||||||||||||||||||
Amortization | (10,316) | (17,009) | (36,008) | (28,006) | |||||||||||||||||||
Ending carrying value | $ | 248,200 | $ | 167,268 | $ | 248,200 | $ | 167,268 |
September 30, 2020 | |||||||||||||||||||||||||||||
Non-life
Run-off |
StarStone | Other | Total | ||||||||||||||||||||||||||
Outstanding losses | $ | 4,461,854 | $ | 698,118 | $ | 10,479 | $ | 5,170,451 | |||||||||||||||||||||
IBNR | 4,360,063 | 611,986 | 15,817 | 4,987,866 | |||||||||||||||||||||||||
Fair value adjustments - acquired companies | (147,500) | (339) | — | (147,839) | |||||||||||||||||||||||||
Fair value adjustments - fair value option | (81,299) | — | — | (81,299) | |||||||||||||||||||||||||
ULAE | 330,472 | 41,233 | — | 371,705 | |||||||||||||||||||||||||
Total | $ | 8,923,590 | $ | 1,350,998 | $ | 26,296 | $ | 10,300,884 | |||||||||||||||||||||
Reconciliation to Consolidated Balance Sheet: | |||||||||||||||||||||||||||||
Loss and loss adjustment expenses | $ | 6,500,912 | $ | 1,350,998 | $ | 26,296 | $ | 7,878,206 | |||||||||||||||||||||
Loss and loss adjustment expenses, at fair value | 2,422,678 | — | — | 2,422,678 | |||||||||||||||||||||||||
Total | $ | 8,923,590 | $ | 1,350,998 | $ | 26,296 | $ | 10,300,884 |
December 31, 2019 | |||||||||||||||||||||||||||||
Non-life
Run-off |
Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Outstanding losses | $ | 4,407,082 | $ | 89,141 | $ | 743,829 | $ | 9,512 | $ | 5,249,564 | |||||||||||||||||||
IBNR | 3,945,407 | 136,543 | 556,135 | 13,565 | 4,651,650 | ||||||||||||||||||||||||
Fair value adjustments - acquired companies | (170,689) | 3,700 | (522) | — | (167,511) | ||||||||||||||||||||||||
Fair value adjustments - fair value option | (217,933) | — | — | — | (217,933) | ||||||||||||||||||||||||
ULAE | 331,494 | 2,288 | 18,852 | — | 352,634 | ||||||||||||||||||||||||
Total | $ | 8,295,361 | $ | 231,672 | $ | 1,318,294 | $ | 23,077 | $ | 9,868,404 | |||||||||||||||||||
Reconciliation to Consolidated Balance Sheet: | |||||||||||||||||||||||||||||
Loss and loss adjustment expenses | $ | 5,674,239 | $ | 231,672 | $ | 1,318,294 | $ | 23,077 | $ | 7,247,282 | |||||||||||||||||||
Loss and loss adjustment expenses, at fair value | 2,621,122 | — | — | — | 2,621,122 | ||||||||||||||||||||||||
Total | $ | 8,295,361 | $ | 231,672 | $ | 1,318,294 | $ | 23,077 | $ | 9,868,404 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Balance as of beginning of period | $ | 10,593,436 | $ | 9,354,891 | $ | 9,868,404 | $ | 9,048,796 | |||||||||||||||
Less: reinsurance reserves recoverable | 1,858,161 | 1,873,766 | 1,927,624 | 1,708,272 | |||||||||||||||||||
Less: deferred charge assets on retroactive reinsurance | 258,516 | 99,094 | 272,462 | 86,585 | |||||||||||||||||||
Less: cumulative effect of change in accounting principle on the determination of the allowance for estimated uncollectible reinsurance balances (1)
|
— | — | 643 | — | |||||||||||||||||||
Net balance as of beginning of period | 8,476,759 | 7,382,031 | 7,667,675 | 7,253,939 | |||||||||||||||||||
Net incurred losses and LAE: | |||||||||||||||||||||||
Current period | 78,965 | 156,344 | 314,083 | 457,720 | |||||||||||||||||||
Prior periods | 30,721 | 6,914 | 25,595 | 108,391 | |||||||||||||||||||
Total net incurred losses and LAE | 109,686 | 163,258 | 339,678 | 566,111 | |||||||||||||||||||
Net paid losses: | |||||||||||||||||||||||
Current period | (17,194) | (36,733) | (32,304) | (107,679) | |||||||||||||||||||
Prior periods | (344,060) | (397,514) | (1,070,063) | (1,255,903) | |||||||||||||||||||
Total net paid losses | (361,254) | (434,247) | (1,102,367) | (1,363,582) | |||||||||||||||||||
Effect of exchange rate movement | 99,129 | (83,277) | (6,139) | (95,270) | |||||||||||||||||||
Acquired on purchase of subsidiaries | — | — | — | 686 | |||||||||||||||||||
Assumed business | 280,497 | 445,000 | 1,705,970 | 1,110,881 | |||||||||||||||||||
Reclassification to assets and liabilities held-for-sale | (219,284) | — | (219,284) | — | |||||||||||||||||||
Net balance as of September 30 | 8,385,533 | 7,472,765 | 8,385,533 | 7,472,765 | |||||||||||||||||||
Plus: reinsurance reserves recoverable (2)
|
1,667,151 | 1,876,613 | 1,667,151 | 1,876,613 | |||||||||||||||||||
Plus: deferred charge assets on retroactive reinsurance | 248,200 | 167,268 | 248,200 | 167,268 | |||||||||||||||||||
Balance as of September 30 | $ | 10,300,884 | $ | 9,516,646 | $ | 10,300,884 | $ | 9,516,646 |
Three Months Ended September 30, 2020 | |||||||||||||||||||||||||||||
Non-life Run-off | Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Net losses paid | $ | 283,882 | $ | 17,189 | $ | 56,727 | $ | 3,456 | $ | 361,254 | |||||||||||||||||||
Net change in case and LAE reserves | (49,887) | 2,701 | 5,456 | 103 | (41,627) | ||||||||||||||||||||||||
Net change in IBNR reserves | (221,800) | 2,386 | (8,579) | 1,484 | (226,509) | ||||||||||||||||||||||||
Increase in estimates of net ultimate losses | 12,195 | 22,276 | 53,604 | 5,043 | 93,118 | ||||||||||||||||||||||||
Reduction in provisions for unallocated LAE | (14,605) | (29) | (5,020) | — | (19,654) | ||||||||||||||||||||||||
Amortization of deferred charge assets | 10,316 | — | — | — | 10,316 | ||||||||||||||||||||||||
Amortization of fair value adjustments | 5,310 | (252) | (194) | — | 4,864 | ||||||||||||||||||||||||
Changes in fair value - fair value option | 21,042 | — | — | — | 21,042 | ||||||||||||||||||||||||
Net incurred losses and LAE | $ | 34,258 | $ | 21,995 | $ | 48,390 | $ | 5,043 | $ | 109,686 |
Three Months Ended September 30, 2019 | |||||||||||||||||||||||||||||
Non-life
Run-off |
Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Net losses paid | $ | 288,445 | $ | 20,005 | $ | 122,848 | $ | 2,949 | $ | 434,247 | |||||||||||||||||||
Net change in case and LAE reserves | (173,104) | (91) | (17,860) | 944 | (190,111) | ||||||||||||||||||||||||
Net change in IBNR reserves | (148,521) | 8,702 | (4,713) | (246) | (144,778) | ||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | (33,180) | 28,616 | 100,275 | 3,647 | 99,358 | ||||||||||||||||||||||||
Reduction in provisions for unallocated LAE | (12,158) | — | (188) | — | (12,346) | ||||||||||||||||||||||||
Amortization of deferred charge assets | 17,009 | — | — | — | 17,009 | ||||||||||||||||||||||||
Amortization of fair value adjustments | 17,538 | (216) | 541 | — | 17,863 | ||||||||||||||||||||||||
Changes in fair value - fair value option | 41,374 | — | — | — | 41,374 | ||||||||||||||||||||||||
Net incurred losses and LAE | $ | 30,583 | $ | 28,400 | $ | 100,628 | $ | 3,647 | $ | 163,258 |
Nine Months Ended September 30, 2020 | |||||||||||||||||||||||||||||
Non-life Run-off | Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Net losses paid | $ | 826,250 | $ | 48,416 | $ | 218,200 | $ | 9,501 | $ | 1,102,367 | |||||||||||||||||||
Net change in case and LAE reserves | (300,573) | 3,635 | (60,887) | 965 | (356,860) | ||||||||||||||||||||||||
Net change in IBNR reserves | (581,979) | 14,227 | 17,032 | 2,252 | (548,468) | ||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | (56,302) | 66,278 | 174,345 | 12,718 | 197,039 | ||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | (34,509) | (29) | 23,475 | — | (11,063) | ||||||||||||||||||||||||
Amortization of deferred charge assets | 36,008 | — | — | — | 36,008 | ||||||||||||||||||||||||
Amortization of fair value adjustments | 21,653 | (246) | (561) | — | 20,846 | ||||||||||||||||||||||||
Changes in fair value - fair value option | 96,848 | — | — | — | 96,848 | ||||||||||||||||||||||||
Net incurred losses and LAE | $ | 63,698 | $ | 66,003 | $ | 197,259 | $ | 12,718 | $ | 339,678 |
Nine Months Ended September 30, 2019 | |||||||||||||||||||||||||||||
Non-life
Run-off |
Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Net losses paid | $ | 966,617 | $ | 60,095 | $ | 329,265 | $ | 7,605 | $ | 1,363,582 | |||||||||||||||||||
Net change in case and LAE reserves | (370,639) | (245) | 13,508 | 2,298 | (355,078) | ||||||||||||||||||||||||
Net change in IBNR reserves | (619,648) | (1,916) | 15,042 | 3,165 | (603,357) | ||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | (23,670) | 57,934 | 357,815 | 13,068 | 405,147 | ||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | (38,229) | — | 739 | — | (37,490) | ||||||||||||||||||||||||
Amortization of deferred charge assets | 28,006 | — | — | — | 28,006 | ||||||||||||||||||||||||
Amortization of fair value adjustments | 34,033 | 728 | 310 | — | 35,071 | ||||||||||||||||||||||||
Changes in fair value - fair value option | 135,377 | — | — | — | 135,377 | ||||||||||||||||||||||||
Net incurred losses and LAE | $ | 135,517 | $ | 58,662 | $ | 358,864 | $ | 13,068 | $ | 566,111 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Balance as of beginning of period | $ | 8,979,234 | $ | 7,803,663 | $ | 8,295,361 | $ | 7,540,662 | |||||||||||||||
Less: reinsurance reserves recoverable | 1,429,489 | 1,534,427 | 1,543,614 | 1,366,123 | |||||||||||||||||||
Less: deferred charge assets on retroactive insurance | 258,516 | 99,094 | 272,462 | 86,585 | |||||||||||||||||||
Plus: cumulative effect of change in accounting principal on allowance for estimated uncollectible reinsurance (1)
|
— | — | 703 | — | |||||||||||||||||||
Net balance as of beginning of period | 7,291,229 | 6,170,142 | 6,479,988 | 6,087,954 | |||||||||||||||||||
Net incurred losses and LAE: | |||||||||||||||||||||||
Current period | 8,218 | 23,845 | 24,153 | 107,291 | |||||||||||||||||||
Prior periods | 26,040 | 6,738 | 39,545 | 28,226 | |||||||||||||||||||
Total net incurred losses and LAE | 34,258 | 30,583 | 63,698 | 135,517 | |||||||||||||||||||
Net paid losses: | |||||||||||||||||||||||
Current period | (739) | (14,374) | (1,777) | (53,265) | |||||||||||||||||||
Prior periods | (283,143) | (274,071) | (824,473) | (913,352) | |||||||||||||||||||
Total net paid losses | (283,882) | (288,445) | (826,250) | (966,617) | |||||||||||||||||||
Effect of exchange rate movement | 86,047 | (73,231) | (15,257) | (84,372) | |||||||||||||||||||
Acquired on purchase of subsidiaries | — | — | — | 686 | |||||||||||||||||||
Assumed business | 280,497 | 445,000 | 1,705,970 | 1,110,881 | |||||||||||||||||||
Reclassification to assets and liabilities held-for-sale | — | — | — | — | |||||||||||||||||||
Net balance as of September 30 | 7,408,149 | 6,284,049 | 7,408,149 | 6,284,049 | |||||||||||||||||||
Plus: reinsurance reserves recoverable (2)
|
1,267,241 | 1,488,374 | 1,267,241 | 1,488,374 | |||||||||||||||||||
Plus: deferred charge assets on retroactive reinsurance | 248,200 | 167,268 | 248,200 | 167,268 | |||||||||||||||||||
Balance as of September 30 | $ | 8,923,590 | $ | 7,939,691 | $ | 8,923,590 | $ | 7,939,691 |
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior
Period |
Current
Period |
Total |
Prior
Period |
Current
Period |
Total | ||||||||||||||||||||||||||||||
Net losses paid | $ | 283,143 | $ | 739 | $ | 283,882 | $ | 274,071 | $ | 14,374 | $ | 288,445 | |||||||||||||||||||||||
Net change in case and LAE reserves | (49,854) | (33) | (49,887) | (175,830) | 2,726 | (173,104) | |||||||||||||||||||||||||||||
Net change in IBNR reserves | (229,312) | 7,512 | (221,800) | (155,315) | 6,794 | (148,521) | |||||||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | 3,977 | 8,218 | 12,195 | (57,074) | 23,894 | (33,180) | |||||||||||||||||||||||||||||
Reduction in provisions for unallocated LAE | (14,605) | — | (14,605) | (12,109) | (49) | (12,158) | |||||||||||||||||||||||||||||
Amortization of deferred charge assets | 10,316 | — | 10,316 | 17,009 | — | 17,009 | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | 5,310 | — | 5,310 | 17,538 | — | 17,538 | |||||||||||||||||||||||||||||
Changes in fair value - fair value option | 21,042 | — | 21,042 | 41,374 | — | 41,374 | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | 26,040 | $ | 8,218 | $ | 34,258 | $ | 6,738 | $ | 23,845 | $ | 30,583 |
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior
Period |
Current
Period |
Total |
Prior
Period |
Current
Period |
Total | ||||||||||||||||||||||||||||||
Net losses paid | $ | 824,473 | $ | 1,777 | $ | 826,250 | $ | 913,352 | $ | 53,265 | $ | 966,617 | |||||||||||||||||||||||
Net change in case and LAE reserves | (301,382) | 809 | (300,573) | (394,780) | 24,141 | (370,639) | |||||||||||||||||||||||||||||
Net change in IBNR reserves | (603,546) | 21,567 | (581,979) | (649,053) | 29,405 | (619,648) | |||||||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | (80,455) | 24,153 | (56,302) | (130,481) | 106,811 | (23,670) | |||||||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | (34,509) | — | (34,509) | (38,709) | 480 | (38,229) | |||||||||||||||||||||||||||||
Amortization of deferred charge assets | 36,008 | — | 36,008 | 28,006 | — | 28,006 | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | 21,653 | — | 21,653 | 34,033 | — | 34,033 | |||||||||||||||||||||||||||||
Changes in fair value - fair value option | 96,848 | — | 96,848 | 135,377 | — | 135,377 | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | 39,545 | $ | 24,153 | $ | 63,698 | $ | 28,226 | $ | 107,291 | $ | 135,517 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Balance as of beginning of period | $ | 239,731 | $ | 222,576 | $ | 231,672 | $ | 241,284 | |||||||||||||||
Less: reinsurance reserves recoverable | 27,250 | 29,606 | 28,816 | 38,768 | |||||||||||||||||||
Less: cumulative effect of change in accounting principal on allowance for estimated uncollectible reinsurance (1)
|
— | — | 851 | — | |||||||||||||||||||
Net balance as of beginning of period | 212,481 | 192,970 | 202,005 | 202,516 | |||||||||||||||||||
Net incurred losses and LAE: | |||||||||||||||||||||||
Current period | 23,129 | 27,093 | 70,075 | 63,189 | |||||||||||||||||||
Prior periods | (1,134) | 1,307 | (4,072) | (4,527) | |||||||||||||||||||
Total net incurred losses and LAE | 21,995 | 28,400 | 66,003 | 58,662 | |||||||||||||||||||
Net paid losses: | |||||||||||||||||||||||
Current period | (7,717) | (9,387) | (17,004) | (24,531) | |||||||||||||||||||
Prior periods | (9,472) | (10,618) | (31,412) | (35,564) | |||||||||||||||||||
Total net paid losses | (17,189) | (20,005) | (48,416) | (60,095) | |||||||||||||||||||
Effect of exchange rate movement | 1,997 | (1,405) | (308) | (1,123) | |||||||||||||||||||
Reclassification to assets and liabilities held-for-sale | (219,284) | — | (219,284) | — | |||||||||||||||||||
Net balance as of September 30 | — | 199,960 | — | 199,960 | |||||||||||||||||||
Plus: reinsurance reserves recoverable (2)
|
— | 31,719 | — | 31,719 | |||||||||||||||||||
Balance as of September 30 | $ | — | $ | 231,679 | $ | — | $ | 231,679 |
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior
Period |
Current
Period |
Total |
Prior
Period |
Current
Period |
Total | ||||||||||||||||||||||||||||||
Net losses paid | $ | 9,472 | $ | 7,717 | $ | 17,189 | $ | 10,618 | $ | 9,387 | $ | 20,005 | |||||||||||||||||||||||
Net change in case and LAE reserves | (2,292) | 4,993 | 2,701 | (2,860) | 2,769 | (91) | |||||||||||||||||||||||||||||
Net change in IBNR reserves | (8,110) | 10,496 | 2,386 | (6,235) | 14,937 | 8,702 | |||||||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | (930) | 23,206 | 22,276 | 1,523 | 27,093 | 28,616 | |||||||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | 48 | (77) | (29) | — | — | — | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | (252) | — | (252) | (216) | — | (216) | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | (1,134) | $ | 23,129 | $ | 21,995 | $ | 1,307 | $ | 27,093 | $ | 28,400 |
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior Period | Current Period | Total | Prior Period | Current Period | Total | ||||||||||||||||||||||||||||||
Net losses paid | $ | 31,412 | $ | 17,004 | $ | 48,416 | $ | 35,564 | $ | 24,531 | $ | 60,095 | |||||||||||||||||||||||
Net change in case and LAE reserves | (9,517) | 13,152 | 3,635 | (13,032) | 12,787 | (245) | |||||||||||||||||||||||||||||
Net change in IBNR reserves | (25,769) | 39,996 | 14,227 | (27,787) | 25,871 | (1,916) | |||||||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | (3,874) | 70,152 | 66,278 | (5,255) | 63,189 | 57,934 | |||||||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | 48 | (77) | (29) | — | — | — | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | (246) | — | (246) | 728 | — | 728 | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | (4,072) | $ | 70,075 | $ | 66,003 | $ | (4,527) | $ | 63,189 | $ | 58,662 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Balance as of beginning of period | $ | 1,349,763 | $ | 1,305,026 | $ | 1,318,294 | $ | 1,247,989 | |||||||||||||||
Less: reinsurance reserves recoverable | 401,422 | 309,733 | 355,194 | 303,381 | |||||||||||||||||||
Less: cumulative effect of change in accounting principal on allowance for estimated uncollectible reinsurance (1)
|
— | — | 495 | — | |||||||||||||||||||
Net balance as of beginning of period | 948,341 | 995,293 | 962,605 | 944,608 | |||||||||||||||||||
Net incurred losses and LAE: | |||||||||||||||||||||||
Current period | 44,734 | 101,808 | 208,414 | 274,070 | |||||||||||||||||||
Prior periods | 3,656 | (1,180) | (11,155) | 84,794 | |||||||||||||||||||
Total net incurred losses and LAE | 48,390 | 100,628 | 197,259 | 358,864 | |||||||||||||||||||
Net paid losses: | |||||||||||||||||||||||
Current period | (7,755) | (11,653) | (12,142) | (27,624) | |||||||||||||||||||
Prior periods | (48,972) | (111,195) | (206,058) | (301,641) | |||||||||||||||||||
Total net paid losses | (56,727) | (122,848) | (218,200) | (329,265) | |||||||||||||||||||
Effect of exchange rate movement | 11,084 | (8,641) | 9,424 | (9,775) | |||||||||||||||||||
Net balance as of September 30 | 951,088 | 964,432 | 951,088 | 964,432 | |||||||||||||||||||
Plus: reinsurance reserves recoverable (2)
|
399,910 | 356,520 | 399,910 | 356,520 | |||||||||||||||||||
Balance as of September 30 | $ | 1,350,998 | $ | 1,320,952 | $ | 1,350,998 | $ | 1,320,952 |
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior Period | Current Period | Total | Prior Period | Current Period | Total | ||||||||||||||||||||||||||||||
Net losses paid | $ | 48,972 | $ | 7,755 | $ | 56,727 | $ | 111,195 | $ | 11,653 | $ | 122,848 | |||||||||||||||||||||||
Net change in case and LAE reserves | (20,068) | 25,524 | 5,456 | (8,866) | (8,994) | (17,860) | |||||||||||||||||||||||||||||
Net change in IBNR reserves | (24,755) | 16,176 | (8,579) | (101,938) | 97,225 | (4,713) | |||||||||||||||||||||||||||||
Increase in estimates of net ultimate losses | 4,149 | 49,455 | 53,604 | 391 | 99,884 | 100,275 | |||||||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | (299) | (4,721) | (5,020) | (2,112) | 1,924 | (188) | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | (194) | — | (194) | 541 | — | 541 | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | 3,656 | $ | 44,734 | $ | 48,390 | $ | (1,180) | $ | 101,808 | $ | 100,628 |
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior Period | Current Period | Total | Prior Period | Current Period | Total | ||||||||||||||||||||||||||||||
Net losses paid | $ | 206,058 | $ | 12,142 | $ | 218,200 | $ | 301,641 | $ | 27,624 | $ | 329,265 | |||||||||||||||||||||||
Net change in case and LAE reserves | (85,798) | 24,911 | (60,887) | (22,538) | 36,046 | 13,508 | |||||||||||||||||||||||||||||
Net change in IBNR reserves | (130,738) | 147,770 | 17,032 | (192,034) | 207,076 | 15,042 | |||||||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | (10,478) | 184,823 | 174,345 | 87,069 | 270,746 | 357,815 | |||||||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | (116) | 23,591 | 23,475 | (2,585) | 3,324 | 739 | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | (561) | — | (561) | 310 | — | 310 | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | (11,155) | $ | 208,414 | $ | 197,259 | $ | 84,794 | $ | 274,070 | $ | 358,864 |
September 30, 2020 | December 31, 2019 | ||||||||||
Defendant asbestos and environmental liabilities: | |||||||||||
Defendant asbestos liabilities | $ | 980,678 | $ | 1,100,593 | |||||||
Defendant environmental liabilities | 8,214 | 10,279 | |||||||||
Estimated future expenses | 45,509 | 51,637 | |||||||||
Fair value adjustments | (280,364) | (314,824) | |||||||||
Defendant asbestos and environmental liabilities | $ | 754,037 | $ | 847,685 | |||||||
Insurance balances recoverable: | |||||||||||
Insurance recoveries related to defendant asbestos and environmental liabilities (net of allowance: 2020 - $5,907)
|
447,800 | 549,593 | |||||||||
Fair value adjustments | (82,512) | (100,738) | |||||||||
Insurance balances recoverable | $ | 365,288 | $ | 448,855 | |||||||
Net liabilities relating to defendant asbestos and environmental exposures | $ | 388,749 | $ | 398,830 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Balance as of beginning of period | $ | 808,062 | $ | 184,264 | $ | 847,685 | $ | 203,320 | |||||||||||||||
Less: Insurance balances recoverable | 428,277 | 122,236 | 448,855 | 135,808 | |||||||||||||||||||
Plus: Cumulative effect of change in accounting principle on the determination of the allowance for estimated uncollectible insurance balances (1)
|
— | — | 3,167 | — | |||||||||||||||||||
Net balance as of beginning of period | 379,785 | 62,028 | 401,997 | 67,512 | |||||||||||||||||||
Total net paid claims | 52,891 | (2,204) | 51,977 | (1,326) | |||||||||||||||||||
Amounts recorded in other (income) expense: | |||||||||||||||||||||||
Reduction in estimates of ultimate net liabilities | (48,439) | — | (75,332) | (4,259) | |||||||||||||||||||
Reduction in estimated future expenses | (3,124) | (800) | (6,127) | (3,104) | |||||||||||||||||||
Amortization of fair value adjustments | 7,636 | 102 | 16,234 | 303 | |||||||||||||||||||
Total other (income) expense | (43,927) | (698) | (65,225) | (7,060) | |||||||||||||||||||
Net balance as at September 30
|
388,749 | 59,126 | 388,749 | 59,126 | |||||||||||||||||||
Plus: Insurance balances recoverable (2)
|
365,288 | 121,237 | 365,288 | 121,237 | |||||||||||||||||||
Balance as at September 30
|
$ | 754,037 | $ | 180,363 | $ | 754,037 | $ | 180,363 |
Three Months Ended | Nine Months Ended | ||||||||||
September 30, 2020 | September 30, 2020 | ||||||||||
Allowance for estimated uncollectible insurance balances, beginning of period | $ | 8,346 | $ | 3,818 | |||||||
Cumulative effect of change in accounting principle | — | 3,167 | |||||||||
Current period change in the allowance | (2,439) | (1,078) | |||||||||
Allowance for estimated uncollectible insurance balances, end of period | $ | 5,907 | $ | 5,907 |
September 30, 2020 | ||||||||||||||||||||||||||||||||
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: | ||||||||||||||||||||||||||||||||
Short-term and fixed maturity investments: | ||||||||||||||||||||||||||||||||
U.S. government and agency | $ | — | $ | 789,630 | $ | — | $ | — | $ | 789,630 | ||||||||||||||||||||||
U.K. government | — | 114,777 | — | — | 114,777 | |||||||||||||||||||||||||||
Other government | — | 490,447 | — | — | 490,447 | |||||||||||||||||||||||||||
Corporate | — | 5,679,909 | — | — | 5,679,909 | |||||||||||||||||||||||||||
Municipal | — | 161,839 | — | — | 161,839 | |||||||||||||||||||||||||||
Residential mortgage-backed | — | 529,239 | — | — | 529,239 | |||||||||||||||||||||||||||
Commercial mortgage-backed | — | 843,119 | — | — | 843,119 | |||||||||||||||||||||||||||
Asset-backed | — | 613,663 | — | — | 613,663 | |||||||||||||||||||||||||||
$ | — | $ | 9,222,623 | $ | — | $ | — | $ | 9,222,623 | |||||||||||||||||||||||
Other assets included within funds held - directly managed | — | 12,438 | — | — | 12,438 | |||||||||||||||||||||||||||
Equities: | ||||||||||||||||||||||||||||||||
Publicly traded equity investments | $ | 282,904 | $ | 21,028 | $ | — | $ | — | $ | 303,932 | ||||||||||||||||||||||
Exchange-traded funds | 78,182 | — | — | — | 78,182 | |||||||||||||||||||||||||||
Privately held equity investments | — | — | 271,045 | — | 271,045 | |||||||||||||||||||||||||||
$ | 361,086 | $ | 21,028 | $ | 271,045 | $ | — | $ | 653,159 | |||||||||||||||||||||||
Other investments: | ||||||||||||||||||||||||||||||||
Hedge funds | $ | — | $ | — | $ | — | $ | 2,087,091 | $ | 2,087,091 | ||||||||||||||||||||||
Fixed income funds | — | 428,645 | — | 255,386 | 684,031 | |||||||||||||||||||||||||||
Equity funds | — | 4,558 | — | 285,571 | 290,129 | |||||||||||||||||||||||||||
Private equity funds | — | — | — | 320,455 | 320,455 | |||||||||||||||||||||||||||
CLO equities | — | 84,532 | — | — | 84,532 | |||||||||||||||||||||||||||
CLO equity funds | — | — | — | 140,458 | 140,458 | |||||||||||||||||||||||||||
Private credit funds | — | — | 10,000 | 80,476 | 90,476 | |||||||||||||||||||||||||||
Other | — | — | 314 | 7,384 | 7,698 | |||||||||||||||||||||||||||
$ | — | $ | 517,735 | $ | 10,314 | $ | 3,176,821 | $ | 3,704,870 | |||||||||||||||||||||||
Total Investments | $ | 361,086 | $ | 9,773,824 | $ | 281,359 | $ | 3,176,821 | $ | 13,593,090 | ||||||||||||||||||||||
Cash and cash equivalents | $ | 270,267 | $ | 139,140 | $ | — | $ | — | $ | 409,407 | ||||||||||||||||||||||
Reinsurance balances recoverable on paid and unpaid losses: | $ | — | $ | — | $ | 543,161 | $ | — | $ | 543,161 | ||||||||||||||||||||||
Other Assets: | ||||||||||||||||||||||||||||||||
Derivatives qualifying as hedges | $ | — | $ | 6,785 | $ | — | $ | — | $ | 6,785 | ||||||||||||||||||||||
Derivatives not qualifying as hedges | — | 1,526 | — | — | 1,526 | |||||||||||||||||||||||||||
Derivative instruments | $ | — | $ | 8,311 | $ | — | $ | — | $ | 8,311 | ||||||||||||||||||||||
Losses and LAE: | $ | — | $ | — | $ | 2,422,678 | $ | — | $ | 2,422,678 | ||||||||||||||||||||||
Other Liabilities: | ||||||||||||||||||||||||||||||||
Derivatives qualifying as hedges | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||||
Derivatives not qualifying as hedges | — | 585 | — | — | 585 | |||||||||||||||||||||||||||
Derivative instruments | $ | — | $ | 585 | $ | — | $ | — | $ | 585 |
December 31, 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: | ||||||||||||||||||||||||||||||||
Short-term and fixed maturity investments: | ||||||||||||||||||||||||||||||||
U.S. government and agency | $ | — | $ | 696,077 | $ | — | $ | — | $ | 696,077 | ||||||||||||||||||||||
U.K government | — | 161,772 | — | — | 161,772 | |||||||||||||||||||||||||||
Other government | — | 702,856 | — | — | 702,856 | |||||||||||||||||||||||||||
Corporate | — | 5,448,270 | — | — | 5,448,270 | |||||||||||||||||||||||||||
Municipal | — | 140,687 | — | — | 140,687 | |||||||||||||||||||||||||||
Residential mortgage-backed | — | 400,914 | — | — | 400,914 | |||||||||||||||||||||||||||
Commercial mortgage-backed | — | 813,746 | — | — | 813,746 | |||||||||||||||||||||||||||
Asset-backed | — | 670,235 | — | — | 670,235 | |||||||||||||||||||||||||||
$ | — | $ | 9,034,557 | $ | — | $ | — | $ | 9,034,557 | |||||||||||||||||||||||
Other assets included within funds held - directly managed | $ | — | $ | 14,207 | $ | — | $ | — | $ | 14,207 | ||||||||||||||||||||||
Equities: | ||||||||||||||||||||||||||||||||
Publicly traded equity investments | $ | 297,310 | $ | 30,565 | $ | — | $ | — | $ | 327,875 | ||||||||||||||||||||||
Exchange-traded funds | 133,047 | — | — | — | 133,047 | |||||||||||||||||||||||||||
Privately held equity investments | — | — | 265,799 | — | 265,799 | |||||||||||||||||||||||||||
$ | 430,357 | $ | 30,565 | $ | 265,799 | $ | — | $ | 726,721 | |||||||||||||||||||||||
Other investments: | ||||||||||||||||||||||||||||||||
Hedge funds | $ | — | $ | — | $ | — | $ | 1,121,904 | $ | 1,121,904 | ||||||||||||||||||||||
Fixed income funds | — | 398,143 | — | 82,896 | 481,039 | |||||||||||||||||||||||||||
Equity funds | — | 111,040 | — | 299,109 | 410,149 | |||||||||||||||||||||||||||
Private equity funds | — | — | — | 323,496 | 323,496 | |||||||||||||||||||||||||||
CLO equities | — | — | 87,555 | — | 87,555 | |||||||||||||||||||||||||||
CLO equity funds | — | — | — | 87,509 | 87,509 | |||||||||||||||||||||||||||
Other | — | 34 | 314 | 6,031 | 6,379 | |||||||||||||||||||||||||||
$ | — | $ | 509,217 | $ | 87,869 | $ | 1,920,945 | $ | 2,518,031 | |||||||||||||||||||||||
Total Investments | $ | 430,357 | $ | 9,588,546 | $ | 353,668 | $ | 1,920,945 | $ | 12,293,516 | ||||||||||||||||||||||
Cash and cash equivalents | $ | 144,984 | $ | 222,191 | $ | — | $ | — | $ | 367,175 | ||||||||||||||||||||||
Reinsurance balances recoverable on paid and unpaid losses: | $ | — | $ | — | $ | 695,518 | $ | — | $ | 695,518 | ||||||||||||||||||||||
Other Assets: | ||||||||||||||||||||||||||||||||
Derivatives qualifying as hedges | $ | — | $ | 642 | $ | — | $ | — | $ | 642 | ||||||||||||||||||||||
Derivatives not qualifying as hedges | — | 1,369 | — | — | 1,369 | |||||||||||||||||||||||||||
Derivative instruments | $ | — | $ | 2,011 | $ | — | $ | — | $ | 2,011 | ||||||||||||||||||||||
Losses and LAE: | $ | — | $ | — | $ | 2,621,122 | $ | — | $ | 2,621,122 | ||||||||||||||||||||||
Other Liabilities: | ||||||||||||||||||||||||||||||||
Derivatives qualifying as hedges | $ | — | $ | 11,452 | $ | — | $ | — | $ | 11,452 | ||||||||||||||||||||||
Derivatives not qualifying as hedges | — | 4,106 | — | — | 4,106 | |||||||||||||||||||||||||||
Derivative instruments | $ | — | $ | 15,558 | $ | — | $ | — | $ | 15,558 |
Three Months Ended September 30, 2020 | ||||||||||||||||||||||||||||||||||||||||||||
Privately-held Equities | Other Investments | Total | ||||||||||||||||||||||||||||||||||||||||||
Beginning fair value | $ | 271,000 | $ | 314 | $ | 271,314 | ||||||||||||||||||||||||||||||||||||||
Purchases | — | 10,000 | 10,000 | |||||||||||||||||||||||||||||||||||||||||
Sales | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Total realized and unrealized gains | 45 | — | 45 | |||||||||||||||||||||||||||||||||||||||||
Transfer out of Level 3 into Level 2 | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Ending fair value | $ | 271,045 | $ | 10,314 | $ | 281,359 |
Three Months Ended September 30, 2019 | |||||||||||||||||||||||||||||||||||||||||
Fixed maturity investments | Privately-held Equities | Other Investments | Total | ||||||||||||||||||||||||||||||||||||||
Corporate | Residential mortgage-backed | Commercial mortgage-backed | Asset-backed | ||||||||||||||||||||||||||||||||||||||
Beginning fair value | $ | 5,006 | $ | 102 | $ | 1,370 | $ | 25,839 | $ | 229,394 | $ | 50,452 | $ | 312,163 | |||||||||||||||||||||||||||
Purchases | 82 | — | — | — | 3,691 | 22,619 | 26,392 | ||||||||||||||||||||||||||||||||||
Sales | (116) | — | (176) | (295) | (2,016) | (361) | (2,964) | ||||||||||||||||||||||||||||||||||
Total realized and unrealized gains (losses) | (103) | (1) | 148 | (743) | (2,378) | (5,287) | (8,364) | ||||||||||||||||||||||||||||||||||
Transfer into Level 3 from Level 2 | 277 | — | — | — | — | — | 277 | ||||||||||||||||||||||||||||||||||
Transfer out of Level 3 into Level 2 | (2,865) | (101) | (1,340) | (5,978) | — | — | (10,284) | ||||||||||||||||||||||||||||||||||
Ending fair value | $ | 2,281 | $ | — | $ | 2 | $ | 18,823 | $ | 228,691 | $ | 67,423 | $ | 317,220 |
Nine Months Ended September 30, 2020 | ||||||||||||||||||||||||||||||||||||||||||||
Privately-held Equities | Other Investments | Total | ||||||||||||||||||||||||||||||||||||||||||
Beginning fair value | $ | 265,799 | $ | 87,869 | $ | 353,668 | ||||||||||||||||||||||||||||||||||||||
Purchases | 1,392 | 47,092 | 48,484 | |||||||||||||||||||||||||||||||||||||||||
Sales | — | (539) | (539) | |||||||||||||||||||||||||||||||||||||||||
Total realized and unrealized gains (losses) | 3,854 | (40,368) | (36,514) | |||||||||||||||||||||||||||||||||||||||||
Transfer into Level 3 from Level 2 | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Transfer out of Level 3 into Level 2 | — | (83,740) | (83,740) | |||||||||||||||||||||||||||||||||||||||||
Ending fair value | $ | 271,045 | $ | 10,314 | $ | 281,359 |
Nine Months Ended September 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 | 172 | — | — | — | 3,691 | 34,614 | 38,477 | |||||||||||||||||||||||||||||||||||||
Sales | (3,157) | — | (784) | (625) | (2,016) | (361) | (6,943) | |||||||||||||||||||||||||||||||||||||
Total realized and unrealized gains (losses) | 114 | (1) | 65 | (4) | (1,694) | (6,197) | (7,717) | |||||||||||||||||||||||||||||||||||||
Transfer into Level 3 from Level 2 | 3,535 | 102 | 1,515 | 22,771 | — | — | 27,923 | |||||||||||||||||||||||||||||||||||||
Transfer out of Level 3 into Level 2 | (35,769) | (101) | (8,183) | (12,440) | — | — | (56,493) | |||||||||||||||||||||||||||||||||||||
Ending fair value | $ | 2,281 | $ | — | $ | 2 | $ | 18,823 | $ | 228,691 | $ | 67,423 | $ | 317,220 |
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||||
Fair Value as of September 30, 2020 | Valuation Techniques | Unobservable Input |
Range (Average) (1)
|
||||||||||||||||||||
(in millions of U.S. dollars) | |||||||||||||||||||||||
$ | 245.4 | Transactional value | Implied price per share at recent purchase transaction |
13.50 - 13.85
|
|||||||||||||||||||
$ | 25.6 | Cost as approximation of fair value | Cost as approximation of fair value | ||||||||||||||||||||
$ | 271.0 |
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Liability for losses and LAE | Reinsurance balances recoverable | Net | Liability for losses and LAE | Reinsurance balances recoverable | Net | ||||||||||||||||||||||||||||||
Beginning fair value | $ | 2,454,539 | $ | 671,384 | $ | 1,783,155 | $ | 2,772,501 | $ | 743,304 | $ | 2,029,197 | |||||||||||||||||||||||
Assumed business | 1,526 | (180,972) | 182,498 | — | — | — | |||||||||||||||||||||||||||||
Incurred losses and LAE: | |||||||||||||||||||||||||||||||||||
Reduction in estimates of ultimate losses | (25,595) | 56,702 | (82,297) | (7,386) | 2,354 | (9,740) | |||||||||||||||||||||||||||||
Reduction in unallocated LAE | (4,641) | — | (4,641) | (6,724) | — | (6,724) | |||||||||||||||||||||||||||||
Change in fair value | 19,092 | (1,950) | 21,042 | 57,743 | 16,369 | 41,374 | |||||||||||||||||||||||||||||
Total incurred losses and LAE | (11,144) | 54,752 | (65,896) | 43,633 | 18,723 | 24,910 | |||||||||||||||||||||||||||||
Paid losses | (86,745) | (11,192) | (75,553) | (100,654) | (21,816) | (78,838) | |||||||||||||||||||||||||||||
Effect of exchange rate movements | 64,502 | 9,189 | 55,313 | (56,836) | (8,307) | (48,529) | |||||||||||||||||||||||||||||
Ending fair value | $ | 2,422,678 | $ | 543,161 | $ | 1,879,517 | $ | 2,658,644 | $ | 731,904 | $ | 1,926,740 |
Three Months Ended
September 30, |
||||||||||||||
2020 | 2019 | |||||||||||||
Changes in fair value due to changes in: | ||||||||||||||
Duration | $ | 11,767 | $ | 3,850 | ||||||||||
Corporate bond yield | 9,275 | 37,524 | ||||||||||||
Change in fair value | $ | 21,042 | $ | 41,374 |
Nine Months Ended
September 30, |
|||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
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 | $ | 2,621,122 | $ | 695,518 | $ | 1,925,604 | $ | 2,874,055 | $ | 739,591 | $ | 2,134,464 | |||||||||||||||||||||||
Assumed business | 1,526 | (180,972) | 182,498 | — | — | — | |||||||||||||||||||||||||||||
Incurred losses and LAE: | |||||||||||||||||||||||||||||||||||
Reduction in estimates of ultimate losses | (61,109) | 48,580 | (109,689) | (20,342) | 4,059 | (24,401) | |||||||||||||||||||||||||||||
Reduction in unallocated LAE | (14,353) | — | (14,353) | (15,076) | — | (15,076) | |||||||||||||||||||||||||||||
Change in fair value | 130,075 | 33,227 | 96,848 | 189,422 | 54,045 | 135,377 | |||||||||||||||||||||||||||||
Total incurred losses and LAE | 54,613 | 81,807 | (27,194) | 154,004 | 58,104 | 95,900 | |||||||||||||||||||||||||||||
Paid losses | (230,187) | (49,627) | (180,560) | (308,267) | (58,139) | (250,128) | |||||||||||||||||||||||||||||
Effect of exchange rate movements | (24,396) | (3,565) | (20,831) | (61,148) | (7,652) | (53,496) | |||||||||||||||||||||||||||||
Ending fair value | $ | 2,422,678 | $ | 543,161 | $ | 1,879,517 | $ | 2,658,644 | $ | 731,904 | $ | 1,926,740 |
Nine Months Ended
September 30, |
||||||||||||||
2020 | 2019 | |||||||||||||
Changes in fair value due to changes in: | ||||||||||||||
Duration | $ | 19,617 | $ | 18,736 | ||||||||||
Corporate bond yield | 75,524 | 116,641 | ||||||||||||
Weighted cost of capital | (5,048) | — | ||||||||||||
Risk cost of capital | 6,755 | — | ||||||||||||
Change in fair value | $ | 96,848 | $ | 135,377 |
September 30, 2020 | December 31, 2019 | |||||||||||||||||||
Valuation Technique | Unobservable (U) and Observable (O) Inputs | Weighted Average | 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% | 5.1% | |||||||||||||||||
Internal model | Weighted average cost of capital (U) | 8.25% | 8.5% | |||||||||||||||||
Internal model | Duration - liability (U) | 7.92 years | 7.82 years | |||||||||||||||||
Internal model | Duration - reinsurance balances recoverable (U) | 7.71 years | 8.68 years |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||||||||||||||||||||||||||
Premiums
Written |
Premiums
Earned |
Premiums
Written |
Premiums
Earned |
Premiums
Written |
Premiums
Earned |
Premiums
Written |
Premiums
Earned |
||||||||||||||||||||||||||||||||||||||||
Non-life Run-off | |||||||||||||||||||||||||||||||||||||||||||||||
Gross | $ | 3,535 | $ | 20,426 | $ | 301 | $ | 27,190 | $ | 1,707 | $ | 52,899 | $ | (24,785) | $ | 166,707 | |||||||||||||||||||||||||||||||
Ceded | (111) | (2,950) | (4,109) | (10,353) | 690 | (8,876) | (1,610) | (24,726) | |||||||||||||||||||||||||||||||||||||||
Net | $ | 3,424 | $ | 17,476 | $ | (3,808) | $ | 16,837 | $ | 2,397 | $ | 44,023 | $ | (26,395) | $ | 141,981 | |||||||||||||||||||||||||||||||
Atrium | |||||||||||||||||||||||||||||||||||||||||||||||
Gross | $ | 49,083 | $ | 48,690 | $ | 48,746 | $ | 48,340 | $ | 155,551 | $ | 144,675 | $ | 146,519 | $ | 133,610 | |||||||||||||||||||||||||||||||
Ceded | (2,580) | (6,264) | (4,961) | (5,427) | (19,458) | (16,492) | (19,273) | (13,745) | |||||||||||||||||||||||||||||||||||||||
Net | $ | 46,503 | $ | 42,426 | $ | 43,785 | $ | 42,913 | $ | 136,093 | $ | 128,183 | $ | 127,246 | $ | 119,865 | |||||||||||||||||||||||||||||||
StarStone | |||||||||||||||||||||||||||||||||||||||||||||||
Gross | $ | 58,566 | $ | 123,813 | $ | 110,586 | $ | 151,895 | $ | 300,135 | $ | 362,638 | $ | 363,352 | $ | 409,135 | |||||||||||||||||||||||||||||||
Ceded | (15,228) | (27,697) | (34,566) | (40,146) | (73,069) | (86,072) | (72,269) | (69,142) | |||||||||||||||||||||||||||||||||||||||
Net | $ | 43,338 | $ | 96,116 | $ | 76,020 | $ | 111,749 | $ | 227,066 | $ | 276,566 | $ | 291,083 | $ | 339,993 | |||||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||||||||||||||||||||
Gross | $ | 293 | $ | 5,705 | $ | (2,498) | $ | 4,338 | $ | 3,237 | $ | 15,173 | $ | (1,174) | $ | 17,024 | |||||||||||||||||||||||||||||||
Ceded | 1 | 1 | (5) | (35) | 1 | 1 | (23) | (152) | |||||||||||||||||||||||||||||||||||||||
Net | $ | 294 | $ | 5,706 | $ | (2,503) | $ | 4,303 | $ | 3,238 | $ | 15,174 | $ | (1,197) | $ | 16,872 | |||||||||||||||||||||||||||||||
Total | |||||||||||||||||||||||||||||||||||||||||||||||
Gross | $ | 111,477 | $ | 198,634 | $ | 157,135 | $ | 231,763 | $ | 460,630 | $ | 575,385 | $ | 483,912 | $ | 726,476 | |||||||||||||||||||||||||||||||
Ceded | (17,918) | (36,910) | (43,641) | (55,961) | (91,836) | (111,439) | (93,175) | (107,765) | |||||||||||||||||||||||||||||||||||||||
Total | $ | 93,559 | $ | 161,724 | $ | 113,494 | $ | 175,802 | $ | 368,794 | $ | 463,946 | $ | 390,737 | $ | 618,711 |
Intangible assets | |||||||||||||||||||||||||||||
Goodwill |
Intangible
assets with a definite life |
Intangible
assets with an indefinite life |
Total | Total | |||||||||||||||||||||||||
Balance as of December 31, 2019 | $ | 109,807 | $ | 14,630 | $ | 67,131 | $ | 81,761 | $ | 191,568 | |||||||||||||||||||
Impairment losses (StarStone International) | (8,000) | — | (4,000) | (4,000) | (12,000) | ||||||||||||||||||||||||
Amortization | — | (1,524) | — | (1,524) | (1,524) | ||||||||||||||||||||||||
Reclassification to assets held-for-sale (Atrium) | (38,848) | (13,106) | (63,131) | (76,237) | (115,085) | ||||||||||||||||||||||||
Balance as of September 30, 2020
|
$ | 62,959 | $ | — | $ | — | $ | — | $ | 62,959 |
Non-life
Run-Off |
Atrium | StarStone | Total | ||||||||||||||||||||
Balance as of December 31, 2019:
|
$ | 62,959 | $ | 38,848 | $ | 8,000 | $ | 109,807 | |||||||||||||||
Impairment losses (StarStone International) | — | — | (8,000) | (8,000) | |||||||||||||||||||
Reclassification to assets held-for-sale (Atrium) | — | (38,848) | — | (38,848) | |||||||||||||||||||
Balance as of September 30, 2020: | |||||||||||||||||||||||
Goodwill | 62,959 | — | 8,000 | 70,959 | |||||||||||||||||||
Accumulated impairment losses | — | — | (8,000) | (8,000) | |||||||||||||||||||
$ | 62,959 | $ | — | $ | — | $ | 62,959 |
September 30, 2020 | December 31, 2019 | ||||||||||||||||||||||||||||||||||
Gross
carrying value |
Accumulated amortization |
Net
carrying value |
Gross
carrying value |
Accumulated amortization |
Net
carrying value |
||||||||||||||||||||||||||||||
Atrium segment: | |||||||||||||||||||||||||||||||||||
Intangible assets with a definite life: | |||||||||||||||||||||||||||||||||||
Distribution channel | $ | — | $ | — | $ | — | $ | 20,000 | $ | (8,111) | $ | 11,889 | |||||||||||||||||||||||
Brand | — | — | — | 7,000 | (4,259) | 2,741 | |||||||||||||||||||||||||||||
Intangible assets with an indefinite life: | |||||||||||||||||||||||||||||||||||
Lloyd’s syndicate capacity | — | — | — | 33,031 | — | 33,031 | |||||||||||||||||||||||||||||
Management contract | — | — | — | 30,100 | — | 30,100 | |||||||||||||||||||||||||||||
Total Atrium segment intangible assets | $ | — | $ | — | $ | — | $ | 90,131 | $ | (12,370) | $ | 77,761 | |||||||||||||||||||||||
StarStone segment: | |||||||||||||||||||||||||||||||||||
Intangible assets with an indefinite life: | |||||||||||||||||||||||||||||||||||
Lloyd’s syndicate capacity | 4,000 | (4,000) | — | 4,000 | — | 4,000 | |||||||||||||||||||||||||||||
Total intangible assets | $ | 4,000 | $ | (4,000) | $ | — | $ | 94,131 | $ | (12,370) | $ | 81,761 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Intangible asset amortization
|
$ | 508 | $ | 546 | $ | 1,524 | $ | 1,676 |
Facility | Origination Date | Term | September 30, 2020 | December 31, 2019 | ||||||||||||||||||||||
4.50% Senior Notes due 2022
|
March 10, 2017 | 5 years | $ | 349,155 | $ | 348,616 | ||||||||||||||||||||
4.95% Senior Notes due 2029
|
May 28, 2019 | 10 years | 493,940 | 493,600 | ||||||||||||||||||||||
Total Senior Notes | 843,095 | 842,216 | ||||||||||||||||||||||||
5.75% Junior Subordinated Notes due 2040
|
August 26, 2020 | 20 years | 344,813 | — | ||||||||||||||||||||||
EGL Revolving Credit Facility | August 16, 2018 | 5 years | 260,000 | — | ||||||||||||||||||||||
2018 EGL Term Loan Facility | December 27, 2018 | 3 years | — | 348,991 | ||||||||||||||||||||||
Total debt obligations | $ | 1,447,908 | $ | 1,191,207 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Interest expense on debt obligations | $ | 14,652 | $ | 14,623 | $ | 41,522 | $ | 38,157 | |||||||||||||||
Amortization of debt issuance costs | 351 | 311 | 914 | 539 | |||||||||||||||||||
Funds withheld balances and other | — | 16 | — | 326 | |||||||||||||||||||
Total interest expense | $ | 15,003 | $ | 14,950 | $ | 42,436 | $ | 39,022 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||||||||||||
Balance at beginning of period | $ | 366,533 | $ | 435,696 | $ | 438,791 | $ | 458,543 | ||||||||||||||||||
Dividends paid | — | — | — | (11,556) | ||||||||||||||||||||||
Net earnings (losses) attributable to RNCI | 20,997 | (190) | (31,102) | (5,651) | ||||||||||||||||||||||
Accumulated other comprehensive earnings attributable to RNCI | 1,220 | (97) | 7,593 | 58 | ||||||||||||||||||||||
Foreign currency translation adjustments | (588) | — | (753) | — | ||||||||||||||||||||||
Change in redemption value of RNCI | (11,431) | (622) | (38,059) | (6,607) | ||||||||||||||||||||||
Cumulative effect of change in accounting principle attributable to RNCI (1)
|
— | — | 261 | — | ||||||||||||||||||||||
Balance at end of period | $ | 376,731 | $ | 434,787 | $ | 376,731 | $ | 434,787 |
Dividend per: | ||||||||||||||||||||||||||||||||||||||
Preferred Share Series | Date Declared | Record Date | Date Paid or Payable | Preferred Share | Depositary Share | Total dividends paid in the nine months ended September 30, 2020 | ||||||||||||||||||||||||||||||||
(in U.S. dollars) | (in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||||
Series D | February 4, 2020 | February 15, 2020 | March 2, 2020 | $ | 437.50 | $ | 0.43750 | $ | 7,000 | |||||||||||||||||||||||||||||
Series E | February 4, 2020 | February 15, 2020 | March 2, 2020 | $ | 437.50 | $ | 0.43750 | 1,925 | ||||||||||||||||||||||||||||||
Series D | May 5, 2020 | May 15, 2020 | June 1, 2020 | $ | 437.50 | $ | 0.43750 | 7,000 | ||||||||||||||||||||||||||||||
Series E | May 5, 2020 | May 15, 2020 | June 1, 2020 | $ | 437.50 | $ | 0.43750 | 1,925 | ||||||||||||||||||||||||||||||
Series D | August 5, 2020 | August 15, 2020 | September 1, 2020 | $ | 437.50 | $ | 0.43750 | 7,000 | ||||||||||||||||||||||||||||||
Series E | August 5, 2020 | August 15, 2020 | September 1, 2020 | $ | 437.50 | $ | 0.43750 | 1,925 | ||||||||||||||||||||||||||||||
Series D | November 5, 2020 | November 15, 2020 | December 1, 2020 | $ | 437.50 | $ | 0.43750 | — | ||||||||||||||||||||||||||||||
Series E | November 5, 2020 | November 15, 2020 | December 1, 2020 | $ | 437.50 | $ | 0.43750 | — | ||||||||||||||||||||||||||||||
$ | 26,775 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Numerator: | |||||||||||||||||||||||
Earnings (losses) attributable to Enstar ordinary shareholders: | |||||||||||||||||||||||
Net earnings from continuing operations (1)
|
$ | 612,636 | $ | 113,074 | $ | 896,267 | $ | 701,234 | |||||||||||||||
Net earnings from discontinued operations (2)
|
2,377 | 4,669 | 478 | 7,102 | |||||||||||||||||||
Net earnings attributable to Enstar ordinary shareholders: | $ | 615,013 | $ | 117,743 | $ | 896,745 | $ | 708,336 | |||||||||||||||
Denominator: | |||||||||||||||||||||||
Weighted-average ordinary shares outstanding — basic (3)
|
21,578,106 | 21,488,216 | 21,564,447 | 21,476,586 | |||||||||||||||||||
Effect of dilutive securities: | |||||||||||||||||||||||
Share-based compensation plans (4)
|
143,581 | 169,162 | 180,437 | 204,288 | |||||||||||||||||||
Warrants | 57,042 | 63,119 | 54,743 | 60,625 | |||||||||||||||||||
Weighted-average ordinary shares outstanding — diluted | 21,778,729 | 21,720,497 | 21,799,627 | 21,741,499 | |||||||||||||||||||
Earnings (loss) per ordinary share attributable to Enstar: | |||||||||||||||||||||||
Basic: | |||||||||||||||||||||||
Net earnings from continuing operations | $ | 28.39 | $ | 5.26 | $ | 41.56 | $ | 32.65 | |||||||||||||||
Net earnings from discontinued operations | 0.11 | 0.22 | 0.02 | 0.33 | |||||||||||||||||||
Net earnings per ordinary share | $ | 28.50 | $ | 5.48 | $ | 41.58 | $ | 32.98 | |||||||||||||||
Diluted: | |||||||||||||||||||||||
Net earnings from continuing operations | $ | 28.13 | $ | 5.21 | $ | 41.12 | $ | 32.25 | |||||||||||||||
Net earnings from discontinued operations | 0.11 | 0.21 | 0.02 | 0.33 | |||||||||||||||||||
Net earnings per ordinary share | $ | 28.24 | $ | 5.42 | $ | 41.14 | $ | 32.58 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Share-based compensation plans: | |||||||||||||||||||||||
Restricted shares and restricted share units | $ | 2,251 | $ | 1,778 | $ | 6,180 | $ | 4,910 | |||||||||||||||
Performance share units | 5,698 | 5,678 | 10,886 | 18,133 | |||||||||||||||||||
Cash-settled stock appreciation rights | 3,705 | 102 | 230 | (109) | |||||||||||||||||||
Joint share ownership plan expense | 1,146 | — | 3,151 | — | |||||||||||||||||||
Other share-based compensation plans: | |||||||||||||||||||||||
Northshore incentive plan | 209 | 1,029 | 656 | 3,061 | |||||||||||||||||||
StarStone incentive plan | — | — | (223) | — | |||||||||||||||||||
Deferred compensation and ordinary share plan for non-employee directors | 139 | 116 | 1,098 | 992 | |||||||||||||||||||
Employee share purchase plan | 110 | 102 | 318 | 309 | |||||||||||||||||||
Total share-based compensation | $ | 13,258 | $ | 8,805 | $ | 22,296 | $ | 27,296 |
September 30, 2020 | December 31, 2019 | ||||||||||
Redeemable Noncontrolling Interest | $ | 361,026 | $ | 420,499 |
September 30, 2020 | December 31, 2019 | ||||||||||
Short-term investments, AFS, at fair value | $ | — | $ | 1,431 | |||||||
Fixed maturities, trading, at fair value | 219,435 | 269,131 | |||||||||
Fixed maturities, AFS, at fair value | 93,779 | 160,303 | |||||||||
Equities, at fair value | 94,353 | 121,794 | |||||||||
Other investments, at fair value: | |||||||||||
Hedge funds | 18,510 | 18,993 | |||||||||
Fixed income funds | 335,033 | 381,449 | |||||||||
Private equity funds | 32,050 | 34,858 | |||||||||
CLO equities | 33,358 | 32,560 | |||||||||
CLO equity funds | 140,458 | 87,509 | |||||||||
Private Debt | 27,079 | 16,312 | |||||||||
Real estate fund | 24,475 | 18,106 | |||||||||
Total investments | 1,018,530 | 1,142,446 | |||||||||
Cash and cash equivalents | 21,293 | 54,080 | |||||||||
Other assets | 6,327 | 10 | |||||||||
Other liabilities | 162 | 4,710 | |||||||||
Net investment | $ | 1,045,988 | $ | 1,191,826 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Net investment income | $ | 2,312 | $ | 2,257 | $ | 11,189 | $ | 5,009 | |||||||||||||||
Net realized and unrealized (losses) gains | 35,925 | (3,442) | (36,862) | 26,305 | |||||||||||||||||||
Total net (losses) earnings | $ | 38,237 | $ | (1,185) | $ | (25,673) | $ | 31,314 |
September 30, 2020 | December 31, 2019 | ||||||||||
Investments in funds managed by AnglePoint, held by Enhanzed Re | $ | 653,040 | $ | 327,799 | |||||||
Our ownership of equity method investments | 47.4 | % | 47.4 | % | |||||||
Our share of Investments in funds managed by AnglePoint held by Enhanzed Re (through our ownership of equity method investments) | $ | 309,541 | $ | 155,377 | |||||||
Investment in other funds managed by Hillhouse Capital and AnglePoint: | |||||||||||
InRe Fund | $ | 1,843,532 | $ | 918,633 | |||||||
Other funds | 306,214 | 232,968 | |||||||||
$ | 2,149,746 | $ | 1,151,601 |
September 30, 2020 | December 31, 2019 | ||||||||||
Investment in Monument Re | $ | 161,994 | $ | 60,598 |
September 30, 2020 | December 31, 2019 | ||||||||||
Investment in Clear Spring | $ | 10,944 | $ | 10,645 |
September 30, 2020 | December 31, 2019 | ||||||||||
Balances under StarStone ceding quota share included, in assets or liabilities held-for-sale: | |||||||||||
Reinsurance balances recoverable | $ | 20,998 | $ | 22,812 | |||||||
Prepaid insurance premiums | — | 51 | |||||||||
Ceded payable | 3,551 | 3,616 | |||||||||
Ceded acquisition costs | — | 21 | |||||||||
Balances under assuming quota share: | |||||||||||
Losses and LAE | 3,995 | 6,135 | |||||||||
Unearned reinsurance premiums | — | 13 | |||||||||
Funds held | 7,468 | 8,611 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Transactions under StarStone ceding quota share, included in net earnings (loss) from discontinued operations: | |||||||||||||||||||||||
Ceded premium earned | $ | 60 | $ | (3,548) | $ | 61 | $ | (13,304) | |||||||||||||||
Ceded incurred losses and LAE | (525) | 1,063 | (1,814) | 8,051 | |||||||||||||||||||
Ceded acquisition costs | (17) | 243 | (44) | 305 | |||||||||||||||||||
Transactions under assuming quota share: | |||||||||||||||||||||||
Premium earned | (15) | 887 | (15) | 3,326 | |||||||||||||||||||
Net incurred losses and LAE | 132 | (576) | 1,014 | (2,013) | |||||||||||||||||||
Acquisition costs | 4 | (88) | 11 | (79) | |||||||||||||||||||
Total net earnings (loss) | $ | (361) | $ | (2,019) | $ | (787) | $ | (3,714) |
September 30, 2020 | December 31, 2019 | ||||||||||
Investment in AmTrust | $ | 245,361 | $ | 240,115 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Net investment income | $ | — | $ | 1,900 | $ | 4,367 | $ | 5,550 | |||||||||||||||
Net realized and unrealized gains | 45 | — | 3,854 | — | |||||||||||||||||||
Total net earnings | $ | 45 | $ | 1,900 | $ | 8,221 | $ | 5,550 |
September 30, 2020 | December 31, 2019 | ||||||||||
Investment in Citco | $ | 51,946 | $ | 51,742 |
September 30, 2020 | December 31, 2019 | ||||||||||
Investment in Enhanzed Re | $ | 271,678 | $ | 182,856 |
September 30, 2020 | December 31, 2019 | ||||||||||||||||
Balances under ceding quota share: | |||||||||||||||||
Insurance balances payables | $ | 1,759 | $ | 1,443 | |||||||||||||
Reinsurance balances recoverable | 53,762 | 59,601 | |||||||||||||||
Funds held | 47,808 | 50,089 | |||||||||||||||
Other assets | 498 | 1,033 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Amounts under ceding quota share: | |||||||||||||||||||||||
Net incurred losses and LAE | $ | (1) | $ | — | $ | (14) | $ | — | |||||||||||||||
Acquisition costs | (46) | — | (23) | — | |||||||||||||||||||
Net investment income | (819) | — | (819) | — | |||||||||||||||||||
Net realized and unrealized gains | (679) | — | (679) | — | |||||||||||||||||||
Other income | 3,113 | — | — | — | |||||||||||||||||||
Fees and commission income | 161 | 150 | 393 | 402 | |||||||||||||||||||
Total Net earnings | 1,729 | 150 | (1,142) | 402 | |||||||||||||||||||
Change in realized gain (losses) on available-for-sale investments | (2,239) | — | (2,239) | — |
Balance sheet classification | September 30, 2020 | December 31, 2019 | |||||||||||||||
Right-of-use assets (1) (2)
|
Other assets | $ | 33,224 | $ | 46,747 | ||||||||||||
Current lease liabilities (2)
|
Other liabilities | 7,955 | 11,403 | ||||||||||||||
Non-current lease liabilities (2)
|
Other liabilities | 28,126 | 34,785 |
September 30, 2020 | ||||||||
2020 | $ | 2,938 | ||||||
2021 | 9,347 | |||||||
2022 | 7,829 | |||||||
2023 | 7,032 | |||||||
2024 | 5,328 | |||||||
2025 and beyond | 12,579 | |||||||
Total lease payments (1)
|
45,053 | |||||||
Less: Imputed interest | (8,972) | |||||||
Present value of lease liabilities | $ | 36,081 |
Three Months Ended September 30, 2020 | |||||||||||||||||||||||||||||
Non-life
Run-off |
Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Gross premiums written | $ | 3,535 | $ | 49,083 | $ | 58,566 | $ | 293 | $ | 111,477 | |||||||||||||||||||
Net premiums written | $ | 3,424 | $ | 46,503 | $ | 43,338 | $ | 294 | $ | 93,559 | |||||||||||||||||||
Net premiums earned | $ | 17,476 | $ | 42,426 | $ | 96,116 | $ | 5,706 | $ | 161,724 | |||||||||||||||||||
Net incurred losses and LAE | (34,258) | (21,995) | (48,390) | (5,043) | (109,686) | ||||||||||||||||||||||||
Acquisition costs | (2,730) | (14,242) | (20,608) | (128) | (37,708) | ||||||||||||||||||||||||
Operating expenses | (50,345) | (3,008) | (20,440) | — | (73,793) | ||||||||||||||||||||||||
Underwriting income (loss) | (69,857) | 3,181 | 6,678 | 535 | (59,463) | ||||||||||||||||||||||||
Net investment income (loss) | 66,918 | 1,778 | 6,298 | (2,864) | 72,130 | ||||||||||||||||||||||||
Net realized and unrealized gains | 486,671 | 1,533 | 11,801 | — | 500,005 | ||||||||||||||||||||||||
Fees and commission income | 3,637 | 7,150 | — | — | 10,787 | ||||||||||||||||||||||||
Other income | 48,023 | 72 | 99 | 210 | 48,404 | ||||||||||||||||||||||||
Corporate expenses | (22,494) | (6,084) | (3,137) | (10,320) | (42,035) | ||||||||||||||||||||||||
Interest income (expense) | (16,705) | — | (510) | 2,212 | (15,003) | ||||||||||||||||||||||||
Net foreign exchange gains (losses) | (9,663) | 2,275 | (761) | (7) | (8,156) | ||||||||||||||||||||||||
EARNINGS (LOSS) BEFORE INCOME TAXES | 486,530 | 9,905 | 20,468 | (10,234) | 506,669 | ||||||||||||||||||||||||
Income tax expense | (9,271) | (2,520) | (733) | (1,391) | (13,915) | ||||||||||||||||||||||||
Earnings from equity method investments | 149,065 | — | — | — | 149,065 | ||||||||||||||||||||||||
NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS | 626,324 | 7,385 | 19,735 | (11,625) | 641,819 | ||||||||||||||||||||||||
NET EARNINGS FROM DISCONTINUED OPERATIONS, NET OF INCOME TAXES | — | — | 4,031 | — | 4,031 | ||||||||||||||||||||||||
NET EARNINGS (LOSS) | 626,324 | 7,385 | 23,766 | (11,625) | 645,850 | ||||||||||||||||||||||||
Net earnings attributable to noncontrolling interest | (2,519) | (2,996) | (16,397) | — | (21,912) | ||||||||||||||||||||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR | 623,805 | 4,389 | 7,369 | (11,625) | 623,938 | ||||||||||||||||||||||||
Dividends on preferred shares | — | — | — | (8,925) | (8,925) | ||||||||||||||||||||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | 623,805 | $ | 4,389 | $ | 7,369 | $ | (20,550) | $ | 615,013 | |||||||||||||||||||
Underwriting ratios: | |||||||||||||||||||||||||||||
Loss ratio
|
51.8 | % | 50.3 | % | |||||||||||||||||||||||||
Acquisition expense ratio | 33.6 | % | 21.4 | % | |||||||||||||||||||||||||
Operating expense ratio | 7.1 | % | 21.4 | % | |||||||||||||||||||||||||
Combined ratio | 92.5 | % | 93.1 | % |
Three Months Ended September 30, 2019 | |||||||||||||||||||||||||||||
Non-life
Run-off |
Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Gross premiums written | $ | 301 | $ | 48,746 | $ | 110,586 | $ | (2,498) | $ | 157,135 | |||||||||||||||||||
Net premiums written | $ | (3,808) | $ | 43,785 | $ | 76,020 | $ | (2,503) | $ | 113,494 | |||||||||||||||||||
Net premiums earned | $ | 16,837 | $ | 42,913 | $ | 111,749 | $ | 4,303 | $ | 175,802 | |||||||||||||||||||
Net incurred losses and LAE | (30,583) | (28,400) | (100,628) | (3,647) | (163,258) | ||||||||||||||||||||||||
Acquisition costs | 4,634 | (14,466) | (23,301) | (177) | (33,310) | ||||||||||||||||||||||||
Operating expenses | (51,395) | (3,742) | (14,525) | — | (69,662) | ||||||||||||||||||||||||
Underwriting income (loss) | (60,507) | (3,695) | (26,705) | 479 | (90,428) | ||||||||||||||||||||||||
Net investment income (loss) | 73,752 | 1,736 | 8,161 | (2,147) | 81,502 | ||||||||||||||||||||||||
Net realized and unrealized gains | 138,174 | 582 | 6,034 | 270 | 145,060 | ||||||||||||||||||||||||
Fees and commission income (expense) | 4,196 | 2,391 | (150) | — | 6,437 | ||||||||||||||||||||||||
Other income (expense) | (285) | 35 | 72 | 1,000 | 822 | ||||||||||||||||||||||||
Corporate expenses | (11,983) | (2,896) | — | (12,824) | (27,703) | ||||||||||||||||||||||||
Interest income (expense) | (17,964) | — | — | 3,014 | (14,950) | ||||||||||||||||||||||||
Net foreign exchange gains (losses) | 13,056 | (924) | 1,509 | 24 | 13,665 | ||||||||||||||||||||||||
EARNINGS (LOSS) BEFORE INCOME TAXES | 138,439 | (2,771) | (11,079) | (10,184) | 114,405 | ||||||||||||||||||||||||
Income tax benefit (expense) | (13,382) | (222) | 139 | — | (13,465) | ||||||||||||||||||||||||
Earnings from equity method investments | 17,703 | — | — | — | 17,703 | ||||||||||||||||||||||||
NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS | 142,760 | (2,993) | (10,940) | (10,184) | 118,643 | ||||||||||||||||||||||||
NET EARNINGS FROM DISCONTINUED OPERATIONS, NET OF INCOME TAXES | — | — | 7,916 | — | 7,916 | ||||||||||||||||||||||||
NET EARNINGS (LOSS) | 142,760 | (2,993) | (3,024) | (10,184) | 126,559 | ||||||||||||||||||||||||
Net (earnings) loss attributable to noncontrolling interest | (1,439) | 1,228 | 320 | — | 109 | ||||||||||||||||||||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR | 141,321 | (1,765) | (2,704) | (10,184) | 126,668 | ||||||||||||||||||||||||
Dividend on preferred shares | — | — | — | (8,925) | (8,925) | ||||||||||||||||||||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | 141,321 | $ | (1,765) | $ | (2,704) | $ | (19,109) | $ | 117,743 | |||||||||||||||||||
Underwriting ratios: | |||||||||||||||||||||||||||||
Loss ratio | 66.2 | % | 90.0 | % | |||||||||||||||||||||||||
Acquisition expense ratio | 33.7 | % | 20.9 | % | |||||||||||||||||||||||||
Operating expense ratio | 8.7 | % | 13.0 | % | |||||||||||||||||||||||||
Combined ratio | 108.6 | % | 123.9 | % |
Nine Months Ended September 30, 2020 | |||||||||||||||||||||||||||||
Non-Life
Run-Off |
Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Gross premiums written | $ | 1,707 | $ | 155,551 | $ | 300,135 | $ | 3,237 | $ | 460,630 | |||||||||||||||||||
Net premiums written | $ | 2,397 | $ | 136,093 | $ | 227,066 | $ | 3,238 | $ | 368,794 | |||||||||||||||||||
Net premiums earned | $ | 44,023 | $ | 128,183 | $ | 276,566 | $ | 15,174 | $ | 463,946 | |||||||||||||||||||
Net incurred losses and LAE | (63,698) | (66,003) | (197,259) | (12,718) | (339,678) | ||||||||||||||||||||||||
Acquisition costs | (13,226) | (43,235) | (76,026) | (331) | (132,818) | ||||||||||||||||||||||||
Operating expenses | (147,117) | (8,757) | (66,385) | — | (222,259) | ||||||||||||||||||||||||
Underwriting income (loss) | (180,018) | 10,188 | (63,104) | 2,125 | (230,809) | ||||||||||||||||||||||||
Net investment income (loss) | 223,425 | 4,382 | 21,625 | (8,145) | 241,287 | ||||||||||||||||||||||||
Net realized and unrealized gains (losses) | 838,483 | 3,392 | (3,323) | — | 838,552 | ||||||||||||||||||||||||
Fees and commission income | 12,588 | 15,737 | — | — | 28,325 | ||||||||||||||||||||||||
Other income (expense) | 68,087 | 105 | 216 | (647) | 67,761 | ||||||||||||||||||||||||
Corporate expenses | (48,014) | (14,494) | (39,153) | (35,166) | (136,827) | ||||||||||||||||||||||||
Interest income (expense) | (48,785) | — | (1,611) | 7,960 | (42,436) | ||||||||||||||||||||||||
Net foreign exchange gains (losses) | 385 | 1,115 | (5,509) | 2,634 | (1,375) | ||||||||||||||||||||||||
EARNINGS (LOSS) BEFORE INCOME TAXES | 866,151 | 20,425 | (90,859) | (31,239) | 764,478 | ||||||||||||||||||||||||
Income tax expense | (18,276) | (3,303) | (2,325) | (1,391) | (25,295) | ||||||||||||||||||||||||
Earnings from equity method investments | 152,725 | — | — | — | 152,725 | ||||||||||||||||||||||||
NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS | 1,000,600 | 17,122 | (93,184) | (32,630) | 891,908 | ||||||||||||||||||||||||
NET EARNINGS FROM DISCONTINUED OPERATIONS, NET OF INCOME TAXES | — | — | 810 | — | 810 | ||||||||||||||||||||||||
NET EARNINGS (LOSS) | 1,000,600 | 17,122 | (92,374) | (32,630) | 892,718 | ||||||||||||||||||||||||
Net (earnings) loss attributable to noncontrolling interest | 504 | (7,024) | 37,322 | — | 30,802 | ||||||||||||||||||||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR | 1,001,104 | 10,098 | (55,052) | (32,630) | 923,520 | ||||||||||||||||||||||||
Dividends on preferred shares | — | — | — | (26,775) | (26,775) | ||||||||||||||||||||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | 1,001,104 | $ | 10,098 | $ | (55,052) | $ | (59,405) | $ | 896,745 | |||||||||||||||||||
Underwriting ratios: | |||||||||||||||||||||||||||||
Loss ratio | 51.5 | % | 71.3 | % | |||||||||||||||||||||||||
Acquisition expense ratio | 33.7 | % | 27.5 | % | |||||||||||||||||||||||||
Operating expense ratio | 6.9 | % | 24.0 | % | |||||||||||||||||||||||||
Combined ratio | 92.1 | % | 122.8 | % |
Nine Months Ended September 30, 2019 | |||||||||||||||||||||||||||||
Non-Life
Run-Off |
Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Gross premiums written | $ | (24,785) | $ | 146,519 | $ | 363,352 | $ | (1,174) | $ | 483,912 | |||||||||||||||||||
Net premiums written | $ | (26,395) | $ | 127,246 | $ | 291,083 | $ | (1,197) | $ | 390,737 | |||||||||||||||||||
Net premiums earned | $ | 141,981 | $ | 119,865 | $ | 339,993 | $ | 16,872 | $ | 618,711 | |||||||||||||||||||
Net incurred losses and LAE | (135,517) | (58,662) | (358,864) | (13,068) | (566,111) | ||||||||||||||||||||||||
Acquisition costs | (40,033) | (41,023) | (80,582) | (554) | (162,192) | ||||||||||||||||||||||||
Operating expenses | (139,595) | (9,968) | (53,217) | — | (202,780) | ||||||||||||||||||||||||
Underwriting income (loss) | (173,164) | 10,212 | (152,670) | 3,250 | (312,372) | ||||||||||||||||||||||||
Net investment income (loss) | 206,337 | 5,500 | 25,865 | (6,278) | 231,424 | ||||||||||||||||||||||||
Net realized and unrealized gains | 815,902 | 5,464 | 31,274 | 5,849 | 858,489 | ||||||||||||||||||||||||
Fees and commission income (expense) | 13,673 | 5,773 | (515) | — | 18,931 | ||||||||||||||||||||||||
Other income (expense) | 15,136 | 106 | 445 | (319) | 15,368 | ||||||||||||||||||||||||
Corporate expenses | (47,287) | (10,186) | — | (36,051) | (93,524) | ||||||||||||||||||||||||
Interest income (expense) | (45,699) | — | (475) | 7,152 | (39,022) | ||||||||||||||||||||||||
Net foreign exchange gains (losses) | 20,426 | (1) | (326) | (2) | 20,097 | ||||||||||||||||||||||||
EARNINGS (LOSS) BEFORE INCOME TAXES | 805,324 | 16,868 | (96,402) | (26,399) | 699,391 | ||||||||||||||||||||||||
Income tax benefit (expense) | (23,501) | (1,930) | 251 | (85) | (25,265) | ||||||||||||||||||||||||
Earnings (loss) from equity method investments | 44,406 | — | (218) | — | 44,188 | ||||||||||||||||||||||||
NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS | 826,229 | 14,938 | (96,369) | (26,484) | 718,314 | ||||||||||||||||||||||||
NET EARNINGS FROM DISCONTINUED OPERATIONS, NET OF INCOME TAXES | — | — | 12,041 | — | 12,041 | ||||||||||||||||||||||||
NET EARNINGS (LOSS) | 826,229 | 14,938 | (84,328) | (26,484) | 730,355 | ||||||||||||||||||||||||
Net (earnings) loss attributable to noncontrolling interest | (6,351) | (6,127) | 17,448 | — | 4,970 | ||||||||||||||||||||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR | 819,878 | 8,811 | (66,880) | (26,484) | 735,325 | ||||||||||||||||||||||||
Dividends on preferred shares | — | — | — | (26,989) | (26,989) | ||||||||||||||||||||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | 819,878 | $ | 8,811 | $ | (66,880) | $ | (53,473) | $ | 708,336 | |||||||||||||||||||
Underwriting ratios: | |||||||||||||||||||||||||||||
Loss ratio | 48.9 | % | 105.6 | % | |||||||||||||||||||||||||
Acquisition expense ratio | 34.2 | % | 23.7 | % | |||||||||||||||||||||||||
Operating expense ratio | 8.4 | % | 15.6 | % | |||||||||||||||||||||||||
Combined ratio | 91.5 | % | 144.9 | % |
September 30, 2020 | December 31, 2019 | ||||||||||
Assets by Segment: | |||||||||||
Non-life Run-off (1)
|
$ | 17,961,439 | $ | 15,775,407 | |||||||
Atrium (2)
|
638,529 | 580,405 | |||||||||
StarStone (3)
|
4,021,240 | 3,985,138 | |||||||||
Other | (850,620) | (514,851) | |||||||||
Total assets | $ | 21,770,588 | $ | 19,826,099 |
Section | Page | |||||||
September 30, 2020 | December 31, 2019 | Change | |||||||||||||||
(expressed in thousands of U.S. dollars, except share and per share data) | |||||||||||||||||
Numerator: | |||||||||||||||||
Total Enstar shareholder's equity | $ | 5,820,885 | $ | 4,842,183 | $ | 978,702 | |||||||||||
Less: Series D and E preferred shares | 510,000 | 510,000 | — | ||||||||||||||
Total Enstar ordinary shareholders' equity (A) | 5,310,885 | 4,332,183 | 978,702 | ||||||||||||||
Proceeds from assumed conversion of warrants(1)
|
20,229 | 20,229 | — | ||||||||||||||
Numerator for fully diluted book value per ordinary share calculations (B) | $ | 5,331,114 | $ | 4,352,412 | $ | 978,702 | |||||||||||
Denominator: | |||||||||||||||||
Ordinary shares outstanding (C) (2)
|
21,503,814 | 21,511,505 | (7,691) | ||||||||||||||
Effect of dilutive securities: | |||||||||||||||||
Share-based compensation plans (3)
|
317,073 | 302,565 | 14,508 | ||||||||||||||
Warrants(1)
|
175,901 | 175,901 | — | ||||||||||||||
Fully diluted ordinary shares outstanding (D) | 21,996,788 | 21,989,971 | 6,817 | ||||||||||||||
Book value per ordinary share: | |||||||||||||||||
Basic book value per ordinary share = (A) / (C) | $ | 246.97 | $ | 201.39 | $ | 45.58 | |||||||||||
Fully diluted book value per ordinary share = (B) / (D) | $ | 242.36 | $ | 197.93 | $ | 44.43 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
(expressed in thousands of U.S. dollars, except share and per share data) | |||||||||||||||||||||||
Net earnings attributable to Enstar ordinary shareholders | $ | 615,013 | $ | 117,743 | $ | 896,745 | $ | 708,336 | |||||||||||||||
Adjustments: | |||||||||||||||||||||||
Net realized and unrealized (gains) on fixed maturity investments and funds held - directly managed (1)
|
(67,294) | (135,005) | (207,097) | (558,755) | |||||||||||||||||||
Change in fair value of insurance contracts for which we have elected the fair value option | 21,042 | 41,374 | 96,848 | 135,377 | |||||||||||||||||||
Net (earnings) from discontinued operations | (4,031) | (7,916) | (810) | (12,041) | |||||||||||||||||||
Tax effects of adjustments (2)
|
5,771 | 12,042 | 19,070 | 50,841 | |||||||||||||||||||
Adjustments attributable to noncontrolling interest (3)
|
3,881 | 4,500 | (536) | 17,397 | |||||||||||||||||||
Non-GAAP operating income attributable to Enstar ordinary shareholders (4)
|
$ | 574,382 | $ | 32,738 | $ | 804,220 | $ | 341,155 | |||||||||||||||
Diluted net earnings per ordinary share | $ | 28.24 | $ | 5.42 | $ | 41.14 | $ | 32.58 | |||||||||||||||
Adjustments: | |||||||||||||||||||||||
Net realized and unrealized (gains) on fixed maturity investments and funds held - directly managed (1)
|
(3.09) | (6.21) | (9.50) | (25.71) | |||||||||||||||||||
Change in fair value of insurance contracts for which we have elected the fair value option | 0.97 | 1.90 | 4.44 | 6.23 | |||||||||||||||||||
Net (earnings) from discontinued operations | (0.19) | (0.36) | (0.04) | (0.55) | |||||||||||||||||||
Tax effects of adjustments (2)
|
0.26 | 0.55 | 0.87 | 2.34 | |||||||||||||||||||
Adjustments attributable to noncontrolling interest (3)
|
0.18 | 0.21 | (0.02) | 0.80 | |||||||||||||||||||
Diluted non-GAAP operating income per ordinary share (4)
|
$ | 26.37 | $ | 1.51 | $ | 36.89 | $ | 15.69 | |||||||||||||||
Weighted average ordinary shares outstanding: | |||||||||||||||||||||||
Basic | 21,578,106 | 21,488,216 | 21,564,447 | 21,476,586 | |||||||||||||||||||
Diluted | 21,778,729 | 21,720,497 | 21,799,627 | 21,741,499 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
INCOME | |||||||||||||||||||||||||||||||||||
Net premiums earned | $ | 161,724 | $ | 175,802 | $ | (14,078) | $ | 463,946 | $ | 618,711 | $ | (154,765) | |||||||||||||||||||||||
Fees and commission income | 10,787 | 6,437 | 4,350 | 28,325 | 18,931 | 9,394 | |||||||||||||||||||||||||||||
Net investment income | 72,130 | 81,502 | (9,372) | 241,287 | 231,424 | 9,863 | |||||||||||||||||||||||||||||
Net realized and unrealized gains (1)
|
500,005 | 145,060 | 354,945 | 838,552 | 858,489 | (19,937) | |||||||||||||||||||||||||||||
Other income | 48,404 | 822 | 47,582 | 67,761 | 15,368 | 52,393 | |||||||||||||||||||||||||||||
793,050 | 409,623 | 383,427 | 1,639,871 | 1,742,923 | (103,052) | ||||||||||||||||||||||||||||||
EXPENSES | |||||||||||||||||||||||||||||||||||
Net incurred losses and LAE | 109,686 | 163,258 | (53,572) | 339,678 | 566,111 | (226,433) | |||||||||||||||||||||||||||||
Acquisition costs | 37,708 | 33,310 | 4,398 | 132,818 | 162,192 | (29,374) | |||||||||||||||||||||||||||||
General and administrative expenses | 115,828 | 97,365 | 18,463 | 359,086 | 296,304 | 62,782 | |||||||||||||||||||||||||||||
Interest expense | 15,003 | 14,950 | 53 | 42,436 | 39,022 | 3,414 | |||||||||||||||||||||||||||||
Net foreign exchange (gains) losses | 8,156 | (13,665) | 21,821 | 1,375 | (20,097) | 21,472 | |||||||||||||||||||||||||||||
286,381 | 295,218 | (8,837) | 875,393 | 1,043,532 | (168,139) | ||||||||||||||||||||||||||||||
EARNINGS BEFORE INCOME TAXES | 506,669 | 114,405 | 392,264 | 764,478 | 699,391 | 65,087 | |||||||||||||||||||||||||||||
Income tax expense | (13,915) | (13,465) | (450) | (25,295) | (25,265) | (30) | |||||||||||||||||||||||||||||
Earnings from equity method investments | 149,065 | 17,703 | 131,362 | 152,725 | 44,188 | 108,537 | |||||||||||||||||||||||||||||
NET EARNINGS FROM CONTINUING OPERATIONS | 641,819 | 118,643 | 523,176 | 891,908 | 718,314 | 173,594 | |||||||||||||||||||||||||||||
NET EARNINGS FROM DISCONTINUED OPERATIONS, NET OF INCOME TAXES | 4,031 | 7,916 | (3,885) | 810 | 12,041 | (11,231) | |||||||||||||||||||||||||||||
NET EARNINGS | 645,850 | 126,559 | 519,291 | 892,718 | 730,355 | 162,363 | |||||||||||||||||||||||||||||
Net loss (earnings) attributable to noncontrolling interest | (21,912) | 109 | (22,021) | 30,802 | 4,970 | 25,832 | |||||||||||||||||||||||||||||
NET EARNINGS ATTRIBUTABLE TO ENSTAR | 623,938 | 126,668 | 497,270 | 923,520 | 735,325 | 188,195 | |||||||||||||||||||||||||||||
Dividends on preferred shares | (8,925) | (8,925) | — | (26,775) | (26,989) | 214 | |||||||||||||||||||||||||||||
NET EARNINGS ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | 615,013 | $ | 117,743 | $ | 497,270 | $ | 896,745 | $ | 708,336 | $ | 188,409 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Segment split of net earnings attributable to Enstar ordinary shareholders: | |||||||||||||||||||||||||||||||||||
Non-life Run-off | $ | 623,805 | $ | 141,321 | $ | 482,484 | $ | 1,001,104 | $ | 819,878 | $ | 181,226 | |||||||||||||||||||||||
Atrium | 4,389 | (1,765) | 6,154 | 10,098 | 8,811 | 1,287 | |||||||||||||||||||||||||||||
StarStone | 7,369 | (2,704) | 10,073 | (55,052) | (66,880) | 11,828 | |||||||||||||||||||||||||||||
Other | (20,550) | (19,109) | (1,441) | (59,405) | (53,473) | (5,932) | |||||||||||||||||||||||||||||
Net earnings attributable to Enstar ordinary shareholders | $ | 615,013 | $ | 117,743 | $ | 497,270 | $ | 896,745 | $ | 708,336 | $ | 188,409 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Gross premiums written | $ | 3,535 | $ | 301 | $ | 3,234 | $ | 1,707 | $ | (24,785) | $ | 26,492 | |||||||||||||||||||||||
Net premiums written | $ | 3,424 | $ | (3,808) | $ | 7,232 | $ | 2,397 | $ | (26,395) | $ | 28,792 | |||||||||||||||||||||||
Net premiums earned | $ | 17,476 | $ | 16,837 | $ | 639 | $ | 44,023 | $ | 141,981 | $ | (97,958) | |||||||||||||||||||||||
Net incurred losses and LAE (1)
|
(34,258) | (30,583) | (3,675) | (63,698) | (135,517) | 71,819 | |||||||||||||||||||||||||||||
Acquisition costs | (2,730) | 4,634 | (7,364) | (13,226) | (40,033) | 26,807 | |||||||||||||||||||||||||||||
Operating expenses | (50,345) | (51,395) | 1,050 | (147,117) | (139,595) | (7,522) | |||||||||||||||||||||||||||||
Underwriting income (loss) (1)
|
(69,857) | (60,507) | (9,350) | (180,018) | (173,164) | (6,854) | |||||||||||||||||||||||||||||
Net investment income | 66,918 | 73,752 | (6,834) | 223,425 | 206,337 | 17,088 | |||||||||||||||||||||||||||||
Net realized and unrealized gains (losses) (2)
|
486,671 | 138,174 | 348,497 | 838,483 | 815,902 | 22,581 | |||||||||||||||||||||||||||||
Fees and commission income | 3,637 | 4,196 | (559) | 12,588 | 13,673 | (1,085) | |||||||||||||||||||||||||||||
Other income (expense) | 48,023 | (285) | 48,308 | 68,087 | 15,136 | 52,951 | |||||||||||||||||||||||||||||
Corporate expenses | (22,494) | (11,983) | (10,511) | (48,014) | (47,287) | (727) | |||||||||||||||||||||||||||||
Interest expense | (16,705) | (17,964) | 1,259 | (48,785) | (45,699) | (3,086) | |||||||||||||||||||||||||||||
Net foreign exchange gains (losses) | (9,663) | 13,056 | (22,719) | 385 | 20,426 | (20,041) | |||||||||||||||||||||||||||||
EARNINGS BEFORE INCOME TAXES | 486,530 | 138,439 | 348,091 | 866,151 | 805,324 | 60,827 | |||||||||||||||||||||||||||||
Income tax expense | (9,271) | (13,382) | 4,111 | (18,276) | (23,501) | 5,225 | |||||||||||||||||||||||||||||
Earnings from equity method investments | 149,065 | 17,703 | 131,362 | 152,725 | 44,406 | 108,319 | |||||||||||||||||||||||||||||
NET EARNINGS | 626,324 | 142,760 | 483,564 | 1,000,600 | 826,229 | 174,371 | |||||||||||||||||||||||||||||
Net loss (earnings) attributable to noncontrolling interest | (2,519) | (1,439) | (1,080) | 504 | (6,351) | 6,855 | |||||||||||||||||||||||||||||
NET EARNINGS ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | 623,805 | $ | 141,321 | $ | 482,484 | $ | 1,001,104 | $ | 819,878 | $ | 181,226 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Gross premiums written | $ | 3,535 | $ | 301 | $ | 3,234 | $ | 1,707 | $ | (24,785) | $ | 26,492 | |||||||||||||||||||||||
Ceded reinsurance premiums written | (111) | (4,109) | 3,998 | 690 | (1,610) | 2,300 | |||||||||||||||||||||||||||||
Net premiums written | $ | 3,424 | $ | (3,808) | $ | 7,232 | $ | 2,397 | $ | (26,395) | $ | 28,792 | |||||||||||||||||||||||
Gross premiums earned | $ | 20,426 | $ | 27,190 | $ | (6,764) | $ | 52,899 | $ | 166,707 | $ | (113,808) | |||||||||||||||||||||||
Ceded reinsurance premiums earned | (2,950) | (10,353) | 7,403 | (8,876) | (24,726) | 15,850 | |||||||||||||||||||||||||||||
Net premiums earned | $ | 17,476 | $ | 16,837 | $ | 639 | $ | 44,023 | $ | 141,981 | $ | (97,958) |
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior
Periods |
Current
Period |
Total |
Prior
Periods |
Current
Period |
Total | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Net losses paid | $ | 283,143 | $ | 739 | $ | 283,882 | $ | 274,071 | $ | 14,374 | $ | 288,445 | |||||||||||||||||||||||
Net change in case and LAE reserves (1)
|
(49,854) | (33) | (49,887) | (175,830) | 2,726 | (173,104) | |||||||||||||||||||||||||||||
Net change in IBNR reserves (2)
|
(229,312) | 7,512 | (221,800) | (155,315) | 6,794 | (148,521) | |||||||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | 3,977 | 8,218 | 12,195 | (57,074) | 23,894 | (33,180) | |||||||||||||||||||||||||||||
Reduction in provisions for unallocated LAE | (14,605) | — | (14,605) | (12,109) | (49) | (12,158) | |||||||||||||||||||||||||||||
Amortization of deferred charge assets | 10,316 | — | 10,316 | 17,009 | — | 17,009 | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | 5,310 | — | 5,310 | 17,538 | — | 17,538 | |||||||||||||||||||||||||||||
Changes in fair value - fair value option | 21,042 | — | 21,042 | 41,374 | — | 41,374 | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | 26,040 | $ | 8,218 | $ | 34,258 | $ | 6,738 | $ | 23,845 | $ | 30,583 |
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior
Periods |
Current
Period |
Total |
Prior
Periods |
Current
Period |
Total | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Net losses paid | $ | 824,473 | $ | 1,777 | $ | 826,250 | $ | 913,352 | $ | 53,265 | $ | 966,617 | |||||||||||||||||||||||
Net change in case and LAE reserves (1)
|
(301,382) | 809 | (300,573) | (394,780) | 24,141 | (370,639) | |||||||||||||||||||||||||||||
Net change in IBNR reserves (2)
|
(603,546) | 21,567 | (581,979) | (649,053) | 29,405 | (619,648) | |||||||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | (80,455) | 24,153 | (56,302) | (130,481) | 106,811 | (23,670) | |||||||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | (34,509) | — | (34,509) | (38,709) | 480 | (38,229) | |||||||||||||||||||||||||||||
Amortization of deferred charge assets | 36,008 | — | 36,008 | 28,006 | — | 28,006 | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | 21,653 | — | 21,653 | 34,033 | — | 34,033 | |||||||||||||||||||||||||||||
Changes in fair value - fair value option | 96,848 | — | 96,848 | 135,377 | — | 135,377 | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | 39,545 | $ | 24,153 | $ | 63,698 | $ | 28,226 | $ | 107,291 | $ | 135,517 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Operating expenses | $ | 50,345 | $ | 51,395 | $ | (1,050) | $ | 147,117 | $ | 139,595 | $ | 7,522 | |||||||||||||||||||||||
Corporate expenses | 22,494 | 11,983 | 10,511 | 48,014 | 47,287 | 727 | |||||||||||||||||||||||||||||
General and administrative expenses | $ | 72,839 | $ | 63,378 | $ | 9,461 | $ | 195,131 | $ | 186,882 | $ | 8,249 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Gross premiums written | $ | 49,083 | $ | 48,746 | $ | 337 | $ | 155,551 | $ | 146,519 | $ | 9,032 | |||||||||||||||||||||||
Net premiums written | $ | 46,503 | $ | 43,785 | $ | 2,718 | $ | 136,093 | $ | 127,246 | $ | 8,847 | |||||||||||||||||||||||
Net premiums earned | $ | 42,426 | $ | 42,913 | $ | (487) | $ | 128,183 | $ | 119,865 | $ | 8,318 | |||||||||||||||||||||||
Net incurred losses and LAE | (21,995) | (28,400) | 6,405 | (66,003) | (58,662) | (7,341) | |||||||||||||||||||||||||||||
Acquisition costs | (14,242) | (14,466) | 224 | (43,235) | (41,023) | (2,212) | |||||||||||||||||||||||||||||
Operating expenses | (3,008) | (3,742) | 734 | (8,757) | (9,968) | 1,211 | |||||||||||||||||||||||||||||
Underwriting income | 3,181 | (3,695) | 6,876 | 10,188 | 10,212 | (24) | |||||||||||||||||||||||||||||
Net investment income | 1,778 | 1,736 | 42 | 4,382 | 5,500 | (1,118) | |||||||||||||||||||||||||||||
Net realized and unrealized gains (1)
|
1,533 | 582 | 951 | 3,392 | 5,464 | (2,072) | |||||||||||||||||||||||||||||
Fees and commission income | 7,150 | 2,391 | 4,759 | 15,737 | 5,773 | 9,964 | |||||||||||||||||||||||||||||
Other income | 72 | 35 | 37 | 105 | 106 | (1) | |||||||||||||||||||||||||||||
Corporate expenses | (6,084) | (2,896) | (3,188) | (14,494) | (10,186) | (4,308) | |||||||||||||||||||||||||||||
Net foreign exchange gains (losses) | 2,275 | (924) | 3,199 | 1,115 | (1) | 1,116 | |||||||||||||||||||||||||||||
EARNINGS (LOSS) BEFORE INCOME TAXES | 9,905 | (2,771) | 12,676 | 20,425 | 16,868 | 3,557 | |||||||||||||||||||||||||||||
Income tax expense | (2,520) | (222) | (2,298) | (3,303) | (1,930) | (1,373) | |||||||||||||||||||||||||||||
NET EARNINGS (LOSS) | 7,385 | (2,993) | 10,378 | 17,122 | 14,938 | 2,184 | |||||||||||||||||||||||||||||
Net loss (earnings) attributable to noncontrolling interest | (2,996) | 1,228 | (4,224) | (7,024) | (6,127) | (897) | |||||||||||||||||||||||||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | 4,389 | $ | (1,765) | $ | 6,154 | $ | 10,098 | $ | 8,811 | $ | 1,287 | |||||||||||||||||||||||
Underwriting ratios(2):
|
|||||||||||||||||||||||||||||||||||
Loss ratio | 51.8 | % | 66.2 | % | (14.4) | % | 51.5 | % | 48.9 | % | 2.6 | % | |||||||||||||||||||||||
Acquisition cost ratio | 33.6 | % | 33.7 | % | (0.1) | % | 33.7 | % | 34.2 | % | (0.5) | % | |||||||||||||||||||||||
Operating expense ratio | 7.1 | % | 8.7 | % | (1.6) | % | 6.9 | % | 8.4 | % | (1.5) | % | |||||||||||||||||||||||
Combined ratio | 92.5 | % | 108.6 | % | (16.1) | % | 92.1 | % | 91.5 | % | 0.6 | % |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Marine, Aviation and Transit | $ | 12,290 | $ | 11,691 | $ | 599 | $ | 41,678 | $ | 35,361 | $ | 6,317 | |||||||||||||||||||||||
Binding Authorities | 22,679 | 21,915 | 764 | 65,080 | 57,563 | 7,517 | |||||||||||||||||||||||||||||
Reinsurance | 3,618 | 4,389 | (771) | 14,659 | 16,293 | (1,634) | |||||||||||||||||||||||||||||
Accident and Health | 2,120 | 4,633 | (2,513) | 11,758 | 18,382 | (6,624) | |||||||||||||||||||||||||||||
Non-Marine Direct and Facultative | 8,376 | 6,118 | 2,258 | 22,376 | 18,920 | 3,456 | |||||||||||||||||||||||||||||
Total | $ | 49,083 | $ | 48,746 | $ | 337 | $ | 155,551 | $ | 146,519 | $ | 9,032 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Marine, Aviation and Transit | $ | 10,476 | $ | 9,524 | $ | 952 | $ | 31,452 | $ | 25,302 | $ | 6,150 | |||||||||||||||||||||||
Binding Authorities | 20,436 | 19,771 | 665 | 58,850 | 55,191 | 3,659 | |||||||||||||||||||||||||||||
Reinsurance | 3,550 | 4,591 | (1,041) | 9,942 | 11,253 | (1,311) | |||||||||||||||||||||||||||||
Accident and Health | 2,212 | 4,036 | (1,824) | 10,587 | 13,960 | (3,373) | |||||||||||||||||||||||||||||
Non-Marine Direct and Facultative | 5,752 | 4,991 | 761 | 17,352 | 14,159 | 3,193 | |||||||||||||||||||||||||||||
Total | $ | 42,426 | $ | 42,913 | $ | (487) | $ | 128,183 | $ | 119,865 | $ | 8,318 |
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior
Periods |
Current
Period |
Total |
Prior
Periods |
Current
Period |
Total | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Net losses paid | $ | 9,472 | $ | 7,717 | $ | 17,189 | $ | 10,618 | $ | 9,387 | $ | 20,005 | |||||||||||||||||||||||
Net change in case and LAE reserves (1)
|
(2,292) | 4,993 | 2,701 | (2,860) | 2,769 | (91) | |||||||||||||||||||||||||||||
Net change in IBNR reserves (2)
|
(8,110) | 10,496 | 2,386 | (6,235) | 14,937 | 8,702 | |||||||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | (930) | 23,206 | 22,276 | 1,523 | 27,093 | 28,616 | |||||||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | 48 | (77) | (29) | — | — | — | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | (252) | — | (252) | (216) | — | (216) | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | (1,134) | $ | 23,129 | $ | 21,995 | $ | 1,307 | $ | 27,093 | $ | 28,400 |
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior
Periods |
Current
Period |
Total |
Prior
Periods |
Current
Period |
Total | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Net losses paid | $ | 31,412 | $ | 17,004 | $ | 48,416 | $ | 35,564 | $ | 24,531 | $ | 60,095 | |||||||||||||||||||||||
Net change in case and LAE reserves (1)
|
(9,517) | 13,152 | 3,635 | (13,032) | 12,787 | (245) | |||||||||||||||||||||||||||||
Net change in IBNR reserves (2)
|
(25,769) | 39,996 | 14,227 | (27,787) | 25,871 | (1,916) | |||||||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | (3,874) | 70,152 | 66,278 | (5,255) | 63,189 | 57,934 | |||||||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | 48 | (77) | (29) | — | — | — | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | (246) | — | (246) | 728 | — | 728 | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | (4,072) | $ | 70,075 | $ | 66,003 | $ | (4,527) | $ | 63,189 | $ | 58,662 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
Gross premiums written | $ | 58,566 | $ | 110,586 | $ | (52,020) | $ | 300,135 | $ | 363,352 | $ | (63,217) | |||||||||||||||||||||||
Net premiums written | $ | 43,338 | $ | 76,020 | $ | (32,682) | $ | 227,066 | $ | 291,083 | $ | (64,017) | |||||||||||||||||||||||
Net premiums earned | $ | 96,116 | $ | 111,749 | $ | (15,633) | $ | 276,566 | $ | 339,993 | $ | (63,427) | |||||||||||||||||||||||
Net incurred losses and LAE | (48,390) | (100,628) | 52,238 | (197,259) | (358,864) | 161,605 | |||||||||||||||||||||||||||||
Acquisition costs | (20,608) | (23,301) | 2,693 | (76,026) | (80,582) | 4,556 | |||||||||||||||||||||||||||||
Operating expenses | (20,440) | (14,525) | (5,915) | (66,385) | (53,217) | (13,168) | |||||||||||||||||||||||||||||
Underwriting income (loss) | 6,678 | (26,705) | 33,383 | (63,104) | (152,670) | 89,566 | |||||||||||||||||||||||||||||
Net investment income | 6,298 | 8,161 | (1,863) | 21,625 | 25,865 | (4,240) | |||||||||||||||||||||||||||||
Net realized and unrealized gains (losses) (1)
|
11,801 | 6,034 | 5,767 | (3,323) | 31,274 | (34,597) | |||||||||||||||||||||||||||||
Fees and commission expense | — | (150) | 150 | — | (515) | 515 | |||||||||||||||||||||||||||||
Other income | 99 | 72 | 27 | 216 | 445 | (229) | |||||||||||||||||||||||||||||
Corporate expenses | (3,137) | — | (3,137) | (39,153) | — | (39,153) | |||||||||||||||||||||||||||||
Interest expense | (510) | — | (510) | (1,611) | (475) | (1,136) | |||||||||||||||||||||||||||||
Net foreign exchange losses (gains) | (761) | 1,509 | (2,270) | (5,509) | (326) | (5,183) | |||||||||||||||||||||||||||||
EARNINGS (LOSS) BEFORE INCOME TAXES | 20,468 | (11,079) | 31,547 | (90,859) | (96,402) | 5,543 | |||||||||||||||||||||||||||||
Income tax benefit (expense) | (733) | 139 | (872) | (2,325) | 251 | (2,576) | |||||||||||||||||||||||||||||
Loss from equity method investments | — | — | — | — | (218) | 218 | |||||||||||||||||||||||||||||
NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS | 19,735 | (10,940) | 30,675 | (93,184) | (96,369) | 3,185 | |||||||||||||||||||||||||||||
NET EARNINGS FROM DISCONTINUED OPERATIONS, NET OF INCOME TAXES | 4,031 | 7,916 | (3,885) | 810 | 12,041 | (11,231) | |||||||||||||||||||||||||||||
NET EARNINGS (LOSS) | 23,766 | (3,024) | 26,790 | (92,374) | (84,328) | (8,046) | |||||||||||||||||||||||||||||
Net loss (earnings) attributable to noncontrolling interest | (16,397) | 320 | (16,717) | 37,322 | 17,448 | 19,874 | |||||||||||||||||||||||||||||
NET EARNINGS (LOSS) ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | 7,369 | $ | (2,704) | $ | 10,073 | $ | (55,052) | $ | (66,880) | $ | 11,828 | |||||||||||||||||||||||
Underwriting ratios(2):
|
|||||||||||||||||||||||||||||||||||
Loss ratio
|
50.3 | % | 90.0 | % | (39.7) | % | 71.3 | % | 105.6 | % | (34.3) | % | |||||||||||||||||||||||
Acquisition cost ratio | 21.4 | % | 20.9 | % | 0.5 | % | 27.5 | % | 23.7 | % | 3.8 | % | |||||||||||||||||||||||
Operating expense ratio | 21.4 | % | 13.0 | % | 8.4 | % | 24.0 | % | 15.6 | % | 8.4 | % | |||||||||||||||||||||||
Combined ratio | 93.1 | % | 123.9 | % | (30.8) | % | 122.8 | % | 144.9 | % | (22.1) | % |
Three Months Ended September 30, 2020 | Nine Months Ended September 30, 2020 | ||||||||||||||||||||||||||||||||||
StarStone Segment | Noncontrolling Interests' Share | Enstar's share of StarStone Segment | StarStone Segment | Noncontrolling Interests' Share | Enstar's share of StarStone Segment | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
StarStone International (1)
|
$ | (891) | $ | 80 | $ | (811) | $ | 38,933 | $ | (12,274) | $ | 26,659 | |||||||||||||||||||||||
StarStone U.S. (Discontinued Operations) | 2,500 | (1,025) | 1,475 | 10,000 | (4,100) | 5,900 | |||||||||||||||||||||||||||||
Total StarStone Segment COVID-19 net underwriting losses | $ | 1,609 | $ | (945) | $ | 664 | $ | 48,933 | $ | (16,374) | $ | 32,559 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2020 | ||||||||||||||||||||||||||||||||||
Subtotal Before Exit Costs | Exit Costs | Total | Subtotal Before Exit Costs | Exit Costs | Total | ||||||||||||||||||||||||||||||
A | B | C=A+B | D | E | F=D+E | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Net premiums earned | $ | 96,116 | $ | — | $ | 96,116 | $ | 280,712 | $ | (4,146) | $ | 276,566 | |||||||||||||||||||||||
Net incurred losses and LAE | (52,800) | 4,410 | (48,390) | (173,556) | (23,703) | (197,259) | |||||||||||||||||||||||||||||
Acquisition costs | (20,608) | — | (20,608) | (76,026) | — | (76,026) | |||||||||||||||||||||||||||||
Operating expenses | (20,440) | — | (20,440) | (66,285) | (100) | (66,385) | |||||||||||||||||||||||||||||
Underwriting income (loss) | 2,268 | 4,410 | 6,678 | (35,155) | (27,949) | (63,104) | |||||||||||||||||||||||||||||
Underwriting ratios(1):
|
|||||||||||||||||||||||||||||||||||
Loss ratio | 54.9 | % | 50.3 | % | 61.8 | % | 71.3 | % | |||||||||||||||||||||||||||
Acquisition cost ratio | 21.4 | % | 21.4 | % | 27.1 | % | 27.5 | % | |||||||||||||||||||||||||||
Operating expense ratio | 21.3 | % | 21.4 | % | 23.6 | % | 24.0 | % | |||||||||||||||||||||||||||
Combined ratio | 97.6 | % | 93.1 | % | 112.5 | % | 122.8 | % |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Casualty | $ | 12,576 | $ | 25,002 | $ | (12,426) | $ | 68,418 | $ | 77,645 | $ | (9,227) | |||||||||||||||||||||||
Marine | 24,363 | 40,699 | (16,336) | 132,721 | 168,657 | (35,936) | |||||||||||||||||||||||||||||
Property | 5,611 | 29,757 | (24,146) | 64,970 | 80,671 | (15,701) | |||||||||||||||||||||||||||||
Aerospace | 15,598 | 12,397 | 3,201 | 32,105 | 33,648 | (1,543) | |||||||||||||||||||||||||||||
Workers' Compensation | 418 | 2,731 | (2,313) | 1,921 | 2,731 | (810) | |||||||||||||||||||||||||||||
Total | $ | 58,566 | $ | 110,586 | $ | (52,020) | $ | 300,135 | $ | 363,352 | $ | (63,217) |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Casualty | $ | 20,471 | $ | 22,314 | $ | (1,843) | $ | 66,419 | $ | 66,733 | $ | (314) | |||||||||||||||||||||||
Marine | 39,424 | 46,747 | (7,323) | 113,016 | 147,542 | (34,526) | |||||||||||||||||||||||||||||
Property | 28,800 | 32,710 | (3,910) | 73,370 | 92,186 | (18,816) | |||||||||||||||||||||||||||||
Aerospace | 6,886 | 8,280 | (1,394) | 21,365 | 32,944 | (11,579) | |||||||||||||||||||||||||||||
Workers' Compensation | 535 | 1,698 | (1,163) | 2,396 | 588 | 1,808 | |||||||||||||||||||||||||||||
Total | $ | 96,116 | $ | 111,749 | $ | (15,633) | $ | 276,566 | $ | 339,993 | $ | (63,427) |
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior
Periods |
Current
Period |
Total |
Prior
Periods |
Current
Period |
Total | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Net losses paid | $ | 48,972 | $ | 7,755 | $ | 56,727 | $ | 111,195 | $ | 11,653 | $ | 122,848 | |||||||||||||||||||||||
Net change in case and LAE reserves (1)
|
(20,068) | 25,524 | 5,456 | (8,866) | (8,994) | (17,860) | |||||||||||||||||||||||||||||
Net change in IBNR reserves (2)
|
(24,755) | 16,176 | (8,579) | (101,938) | 97,225 | (4,713) | |||||||||||||||||||||||||||||
Increase in estimates of net ultimate losses | 4,149 | 49,455 | 53,604 | 391 | 99,884 | 100,275 | |||||||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | (299) | (4,721) | (5,020) | (2,112) | 1,924 | (188) | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | (194) | — | (194) | 541 | — | 541 | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | 3,656 | $ | 44,734 | $ | 48,390 | $ | (1,180) | $ | 101,808 | $ | 100,628 |
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | ||||||||||||||||||||||||||||||||||
Prior
Periods |
Current
Period |
Total |
Prior
Periods |
Current
Period |
Total | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Net losses paid | $ | 206,058 | $ | 12,142 | $ | 218,200 | $ | 301,641 | $ | 27,624 | $ | 329,265 | |||||||||||||||||||||||
Net change in case and LAE reserves (1)
|
(85,798) | 24,911 | (60,887) | (22,538) | 36,046 | 13,508 | |||||||||||||||||||||||||||||
Net change in IBNR reserves (2)
|
(130,738) | 147,770 | 17,032 | (192,034) | 207,076 | 15,042 | |||||||||||||||||||||||||||||
Increase (reduction) in estimates of net ultimate losses | (10,478) | 184,823 | 174,345 | 87,069 | 270,746 | 357,815 | |||||||||||||||||||||||||||||
Increase (reduction) in provisions for unallocated LAE | (116) | 23,591 | 23,475 | (2,585) | 3,324 | 739 | |||||||||||||||||||||||||||||
Amortization of fair value adjustments | (561) | — | (561) | 310 | — | 310 | |||||||||||||||||||||||||||||
Net incurred losses and LAE | $ | (11,155) | $ | 208,414 | $ | 197,259 | $ | 84,794 | $ | 274,070 | $ | 358,864 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
StarStone U.S. Group net earnings (loss) before Intra-Group Cessions | $ | 6,192 | $ | 15,146 | $ | 24,386 | $ | (24,510) | |||||||||||||||||||||||||||
Intra-Group Cessions | (2,161) | (7,230) | (23,576) | 36,551 | |||||||||||||||||||||||||||||||
StarStone U.S. net earnings, net of income taxes | $ | 4,031 | $ | 7,916 | $ | 810 | $ | 12,041 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2020 | 2019 | Change | ||||||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Net premiums earned | $ | 5,706 | $ | 4,303 | $ | 1,403 | $ | 15,174 | $ | 16,872 | $ | (1,698) | |||||||||||||||||||||||
Net incurred losses and LAE | (5,043) | (3,647) | (1,396) | (12,718) | (13,068) | 350 | |||||||||||||||||||||||||||||
Acquisition costs | (128) | (177) | 49 | (331) | (554) | 223 | |||||||||||||||||||||||||||||
Underwriting income | 535 | 479 | 56 | 2,125 | 3,250 | (1,125) | |||||||||||||||||||||||||||||
Net investment losses | (2,864) | (2,147) | (717) | (8,145) | (6,278) | (1,867) | |||||||||||||||||||||||||||||
Net realized and unrealized gains | — | 270 | (270) | — | 5,849 | (5,849) | |||||||||||||||||||||||||||||
Other income (expense) | 210 | 1,000 | (790) | (647) | (319) | (328) | |||||||||||||||||||||||||||||
Corporate expenses | (10,320) | (12,824) | 2,504 | (35,166) | (36,051) | 885 | |||||||||||||||||||||||||||||
Interest Income | 2,212 | 3,014 | (802) | 7,960 | 7,152 | 808 | |||||||||||||||||||||||||||||
Net foreign exchange gains (losses) | (7) | 24 | (31) | 2,634 | (2) | 2,636 | |||||||||||||||||||||||||||||
LOSS BEFORE INCOME TAXES | (10,234) | (10,184) | (50) | (31,239) | (26,399) | (4,840) | |||||||||||||||||||||||||||||
Income tax expense | (1,391) | — | (1,391) | (1,391) | (85) | (1,306) | |||||||||||||||||||||||||||||
NET LOSS ATTRIBUTABLE TO ENSTAR | (11,625) | (10,184) | (1,441) | (32,630) | (26,484) | (6,146) | |||||||||||||||||||||||||||||
Dividends on preferred shares | (8,925) | (8,925) | — | (26,775) | (26,989) | 214 | |||||||||||||||||||||||||||||
NET LOSS ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | (20,550) | $ | (19,109) | $ | (1,441) | $ | (59,405) | $ | (53,473) | $ | (5,932) |
September 30, 2020 | |||||||||||||||||||||||||||||
Non-life
Run-off |
StarStone | Other | Total | ||||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||
Short-term investments, trading, at fair value | $ | 7,133 | $ | — | $ | — | $ | 7,133 | |||||||||||||||||||||
Short-term investments, AFS, at fair value | 276,005 | 2,170 | — | 278,175 | |||||||||||||||||||||||||
Fixed maturities, trading, at fair value | 4,494,177 | 505,465 | — | 4,999,642 | |||||||||||||||||||||||||
Fixed maturities, AFS, at fair value | 2,661,649 | 221,823 | — | 2,883,472 | |||||||||||||||||||||||||
Funds held - directly managed | 1,066,639 | — | — | 1,066,639 | |||||||||||||||||||||||||
Equities, at fair value | 581,136 | 72,023 | — | 653,159 | |||||||||||||||||||||||||
Other investments, at fair value | 3,610,498 | 94,372 | — | 3,704,870 | |||||||||||||||||||||||||
Equity method investments | 516,795 | — | — | 516,795 | |||||||||||||||||||||||||
Total investments | 13,214,032 | 895,853 | — | 14,109,885 | |||||||||||||||||||||||||
Cash and cash equivalents (including restricted cash) | 941,051 | 234,966 | 21,305 | 1,197,322 | |||||||||||||||||||||||||
Funds held by reinsured companies | 560,772 | 88,888 | 7,830 | 657,490 | |||||||||||||||||||||||||
Total investable assets | $ | 14,715,855 | $ | 1,219,707 | $ | 29,135 | $ | 15,964,697 | |||||||||||||||||||||
Duration (in years) (1)
|
5.27 | 2.17 | — | 4.97 | |||||||||||||||||||||||||
Average credit rating (2)
|
A+ | AA- | AAA | A+ |
December 31, 2019 | |||||||||||||||||||||||||||||
Non-life
Run-off |
Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
(in thousands of U.S. dollars) | |||||||||||||||||||||||||||||
Short-term investments, trading, at fair value | $ | 50,268 | $ | 1,222 | $ | — | $ | — | $ | 51,490 | |||||||||||||||||||
Short-term investments, AFS, at fair value | 121,780 | — | 6,555 | — | 128,335 | ||||||||||||||||||||||||
Fixed maturities, trading, at fair value | 5,378,533 | 155,510 | 609,292 | — | 6,143,335 | ||||||||||||||||||||||||
Fixed maturities, AFS, at fair value | 1,446,912 | 15,310 | 75,830 | — | 1,538,052 | ||||||||||||||||||||||||
Funds held - directly managed | 1,187,552 | — | — | — | 1,187,552 | ||||||||||||||||||||||||
Equities, at fair value | 576,893 | 22,079 | 127,749 | — | 726,721 | ||||||||||||||||||||||||
Other investments, at fair value | 2,386,776 | 7,417 | 123,838 | — | 2,518,031 | ||||||||||||||||||||||||
Equity method investments | 326,277 | — | — | — | 326,277 | ||||||||||||||||||||||||
Total investments | 11,474,991 | 201,538 | 943,264 | — | 12,619,793 | ||||||||||||||||||||||||
Cash and cash equivalents (including restricted cash) | 666,705 | 58,369 | 241,708 | 4,567 | 971,349 | ||||||||||||||||||||||||
Funds held by reinsured companies | 336,470 | 27,451 | 103,191 | 8,620 | 475,732 | ||||||||||||||||||||||||
Total investable assets | $ | 12,478,166 | $ | 287,358 | $ | 1,288,163 | $ | 13,187 | $ | 14,066,874 | |||||||||||||||||||
Duration (in years) (1)
|
5.24 | 1.86 | 2.07 | — | 4.86 | ||||||||||||||||||||||||
Average credit rating (2)
|
A+ | AA- | A+ | AAA | A+ |
Gross Unrealized Losses | ||||||||||||||||||||||||||||||||
As of September 30, 2020 | Amortized Cost | Gross Unrealized Gains | Non-Credit Related Losses |
Allowance for Credit Losses(1)
|
Fair Value | |||||||||||||||||||||||||||
U.S. government and agency | $ | 769,544 | $ | 20,612 | $ | (526) | $ | — | $ | 789,630 | ||||||||||||||||||||||
U.K. government | 111,169 | 3,882 | (274) | — | 114,777 | |||||||||||||||||||||||||||
Other government | 466,575 | 24,927 | (1,055) | — | 490,447 | |||||||||||||||||||||||||||
Corporate | 5,339,160 | 357,069 | (15,536) | (784) | 5,679,909 | |||||||||||||||||||||||||||
Municipal | 146,087 | 16,023 | (271) | — | 161,839 | |||||||||||||||||||||||||||
Residential mortgage-backed | 521,383 | 9,223 | (1,365) | (2) | 529,239 | |||||||||||||||||||||||||||
Commercial mortgage-backed | 821,995 | 36,811 | (15,606) | (81) | 843,119 | |||||||||||||||||||||||||||
Asset-backed | 631,133 | 2,962 | (20,387) | (45) | 613,663 | |||||||||||||||||||||||||||
$ | 8,807,046 | $ | 471,509 | $ | (55,020) | $ | (912) | $ | 9,222,623 |
As of December 31, 2019 | Amortized Cost | Gross Unrealized Gains |
Gross Unrealized Losses
(Non-OTTI) |
Fair Value | ||||||||||||||||||||||||||||
U.S. government and agency | $ | 690,343 | $ | 6,663 | $ | (929) | $ | 696,077 | ||||||||||||||||||||||||
U.K. government | 155,261 | 6,628 | (117) | 161,772 | ||||||||||||||||||||||||||||
Other government | 684,116 | 24,994 | (6,254) | 702,856 | ||||||||||||||||||||||||||||
Corporate | 5,231,512 | 235,406 | (18,648) | 5,448,270 | ||||||||||||||||||||||||||||
Municipal | 131,130 | 9,595 | (38) | 140,687 | ||||||||||||||||||||||||||||
Residential mortgage-backed | 396,331 | 5,981 | (1,398) | 400,914 | ||||||||||||||||||||||||||||
Commercial mortgage-backed | 796,730 | 20,673 | (3,657) | 813,746 | ||||||||||||||||||||||||||||
Asset-backed | 674,250 | 1,806 | (5,821) | 670,235 | ||||||||||||||||||||||||||||
$ | 8,759,673 | $ | 311,746 | $ | (36,862) | $ | 9,034,557 |
Fair Value | Average Credit Rating | |||||||||||||
(in thousands of U.S. dollars) | ||||||||||||||
Bank of America Corp | $ | 107,601 | A | |||||||||||
Citigroup Inc | 103,749 | A- | ||||||||||||
Morgan Stanley | 100,296 | A- | ||||||||||||
JPMorgan Chase & Co | 93,385 | A | ||||||||||||
Wells Fargo & Co | 86,810 | A | ||||||||||||
Comcast Corp | 85,102 | A- | ||||||||||||
Apple Inc | 79,948 | AA+ | ||||||||||||
AT&T Inc | 59,322 | BBB | ||||||||||||
HSBC Holdings PLC | 54,328 | A- | ||||||||||||
Walmart Inc | 50,813 | AA | ||||||||||||
$ | 821,354 |
Three Months Ended September 30, 2020 | |||||||||||||||||||||||||||||
Non-Life Run-off | Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Net investment income: | |||||||||||||||||||||||||||||
Fixed income securities (1)
|
$ | 56,646 | $ | 1,151 | $ | 5,675 | $ | — | $ | 63,472 | |||||||||||||||||||
Cash and restricted cash | 88 | 535 | 53 | 2 | 678 | ||||||||||||||||||||||||
Other investments, including equities | 12,028 | 102 | 1,507 | (2,866) | 10,771 | ||||||||||||||||||||||||
Less: Investment expenses | (1,844) | (10) | (937) | — | (2,791) | ||||||||||||||||||||||||
Total net investment income (expense) | $ | 66,918 | $ | 1,778 | $ | 6,298 | $ | (2,864) | $ | 72,130 | |||||||||||||||||||
Net realized gains (losses): | |||||||||||||||||||||||||||||
Fixed income securities (1)
|
$ | 42,761 | $ | 31 | $ | 2,364 | $ | — | $ | 45,156 | |||||||||||||||||||
Other investments, including equities | 8,287 | 4 | 41 | — | 8,332 | ||||||||||||||||||||||||
Total net realized gains | $ | 51,048 | $ | 35 | $ | 2,405 | $ | — | $ | 53,488 | |||||||||||||||||||
Net unrealized gains: | |||||||||||||||||||||||||||||
Fixed income securities, trading (1)
|
$ | 18,900 | $ | 242 | $ | 2,996 | $ | — | $ | 22,138 | |||||||||||||||||||
Other investments, including equities | 416,723 | 1,256 | 6,400 | — | 424,379 | ||||||||||||||||||||||||
Total net unrealized gains | $ | 435,623 | $ | 1,498 | $ | 9,396 | $ | — | $ | 446,517 | |||||||||||||||||||
Total investment return included in earnings (A) | $ | 553,589 | $ | 3,311 | $ | 18,099 | $ | (2,864) | $ | 572,135 | |||||||||||||||||||
Other comprehensive income: | |||||||||||||||||||||||||||||
Unrealized gains (losses), on fixed income securities, AFS, net of reclassification adjustments excluding foreign exchange (B) (1)
|
$ | 127 | $ | (35) | $ | 499 | $ | — | $ | 591 | |||||||||||||||||||
Total investment return = (A) + (B) | $ | 553,716 | $ | 3,276 | $ | 18,598 | $ | (2,864) | $ | 572,726 | |||||||||||||||||||
Annualized income from fixed income assets (2)
|
$ | 226,936 | $ | 6,744 | $ | 22,912 | $ | 8 | $ | 256,600 | |||||||||||||||||||
Average aggregate fixed income assets, at cost (2)(3)
|
9,655,624 | 261,074 | 1,046,616 | 21,478 | 10,984,792 | ||||||||||||||||||||||||
Annualized investment book yield | 2.35 | % | 2.58 | % | 2.19 | % | 0.04 | % | 2.34 | % | |||||||||||||||||||
Average aggregate invested assets, at fair value (3)
|
$ | 13,988,360 | $ | 303,793 | $ | 1,215,379 | $ | 21,478 | $ | 15,529,010 | |||||||||||||||||||
Investment return included in net earnings | 3.96 | % | 1.09 | % | 1.49 | % | (13.33) | % | 3.68 | % | |||||||||||||||||||
Total investment return | 3.96 | % | 1.08 | % | 1.53 | % | (13.33) | % | 3.69 | % |
Three Months Ended September 30, 2019 | |||||||||||||||||||||||||||||
Non-Life Run-off | Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Net investment income: | |||||||||||||||||||||||||||||
Fixed income securities (1)
|
$ | 63,565 | $ | 956 | $ | 2,918 | $ | (394) | $ | 67,045 | |||||||||||||||||||
Cash and restricted cash | 5,484 | 696 | 3,476 | 382 | 10,038 | ||||||||||||||||||||||||
Other investments, including equities | 7,113 | 154 | 1,960 | (2,169) | 7,058 | ||||||||||||||||||||||||
Less: Investment expenses | (2,410) | (70) | (193) | 34 | (2,639) | ||||||||||||||||||||||||
Total net investment income (expense) | $ | 73,752 | $ | 1,736 | $ | 8,161 | $ | (2,147) | $ | 81,502 | |||||||||||||||||||
Net realized gains (losses): | |||||||||||||||||||||||||||||
Fixed income securities (1)
|
$ | 26,143 | $ | (42) | $ | 1,168 | $ | 1 | $ | 27,270 | |||||||||||||||||||
Other investments, including equities | (3,960) | 37 | 42 | — | (3,881) | ||||||||||||||||||||||||
Total net realized gains (losses) | $ | 22,183 | $ | (5) | $ | 1,210 | $ | 1 | $ | 23,389 | |||||||||||||||||||
Net unrealized gains (losses): | |||||||||||||||||||||||||||||
Fixed income securities, trading (1)
|
$ | 103,948 | $ | 606 | $ | 3,181 | $ | — | $ | 107,735 | |||||||||||||||||||
Other investments, including equities | 12,043 | (19) | 1,643 | 269 | 13,936 | ||||||||||||||||||||||||
Total net unrealized gains | $ | 115,991 | $ | 587 | $ | 4,824 | $ | 269 | $ | 121,671 | |||||||||||||||||||
Total investment return included in earnings (A) | $ | 211,926 | $ | 2,318 | $ | 14,195 | $ | (1,877) | $ | 226,562 | |||||||||||||||||||
Other comprehensive income: | |||||||||||||||||||||||||||||
Unrealized gains (losses), on fixed income securities, AFS, net of reclassification adjustments excluding foreign exchange (B) (1)
|
$ | 21 | $ | 18 | $ | (26) | $ | — | $ | 13 | |||||||||||||||||||
Total investment return = (A) + (B) | $ | 211,947 | $ | 2,336 | $ | 14,169 | $ | (1,877) | $ | 226,575 | |||||||||||||||||||
Annualized income from fixed income assets (2)
|
$ | 276,196 | $ | 6,608 | $ | 25,576 | $ | (48) | $ | 308,332 | |||||||||||||||||||
Average aggregate fixed income assets, at cost (2)(3)
|
8,632,415 | 251,305 | 1,210,051 | 15,279 | 10,109,050 | ||||||||||||||||||||||||
Annualized investment book yield | 3.20 | % | 2.63 | % | 2.11 | % | (0.31) | % | 3.05 | % | |||||||||||||||||||
Average aggregate invested assets, at fair value (3)
|
$ | 11,662,416 | $ | 264,029 | $ | 1,419,869 | $ | 18,293 | $ | 13,364,607 | |||||||||||||||||||
Investment return included in net earnings | 1.82 | % | 0.88 | % | 1.00 | % | (10.26) | % | 1.70 | % | |||||||||||||||||||
Total investment return | 1.82 | % | 0.88 | % | 1.00 | % | (10.26) | % | 1.70 | % |
Nine Months Ended September 30, 2020 | |||||||||||||||||||||||||||||
Non-Life Run-off | Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Net investment income: | |||||||||||||||||||||||||||||
Fixed income securities (1)
|
$ | 192,998 | $ | 3,792 | $ | 17,340 | $ | — | $ | 214,130 | |||||||||||||||||||
Cash and restricted cash | 2,229 | 322 | 892 | 103 | 3,546 | ||||||||||||||||||||||||
Other investments, including equities | 36,455 | 420 | 5,253 | (8,248) | 33,880 | ||||||||||||||||||||||||
Less: Investment expenses | (8,257) | (152) | (1,860) | — | (10,269) | ||||||||||||||||||||||||
Total net investment income (expense) | $ | 223,425 | $ | 4,382 | $ | 21,625 | $ | (8,145) | $ | 241,287 | |||||||||||||||||||
Net realized gains (losses): | |||||||||||||||||||||||||||||
Fixed income securities (1)
|
$ | 102,588 | $ | (338) | $ | 3,433 | $ | — | $ | 105,683 | |||||||||||||||||||
Other investments, including equities | 7,579 | 135 | 1,497 | — | 9,211 | ||||||||||||||||||||||||
Total net realized gains (losses) | $ | 110,167 | $ | (203) | $ | 4,930 | $ | — | $ | 114,894 | |||||||||||||||||||
Net unrealized gains (losses): | |||||||||||||||||||||||||||||
Fixed income securities, trading (1)
|
$ | 105,787 | $ | 3,658 | $ | (8,031) | $ | — | $ | 101,414 | |||||||||||||||||||
Other investments, including equities | 622,529 | (63) | (222) | — | 622,244 | ||||||||||||||||||||||||
Total net unrealized gains (losses) | $ | 728,316 | $ | 3,595 | $ | (8,253) | $ | — | $ | 723,658 | |||||||||||||||||||
Total investment return included in earnings (A) | $ | 1,061,908 | $ | 7,774 | $ | 18,302 | $ | (8,145) | $ | 1,079,839 | |||||||||||||||||||
Other comprehensive income: | |||||||||||||||||||||||||||||
Unrealized gains (losses), on fixed income securities, AFS, net of reclassification adjustments excluding foreign exchange (B) (1)
|
$ | 41,683 | $ | 9 | $ | 2,037 | $ | — | $ | 43,729 | |||||||||||||||||||
Total investment return = (A) + (B) | $ | 1,103,591 | $ | 7,783 | $ | 20,339 | $ | (8,145) | $ | 1,123,568 | |||||||||||||||||||
Annualized income from fixed income assets (2)
|
$ | 260,303 | $ | 5,485 | $ | 24,309 | $ | 137 | $ | 290,235 | |||||||||||||||||||
Average aggregate fixed income assets, at cost (2)(3)
|
9,421,717 | 259,825 | 1,036,768 | 17,168 | 10,735,478 | ||||||||||||||||||||||||
Annualized investment book yield | 2.76 | % | 2.11 | % | 2.34 | % | 0.80 | % | 2.70 | % | |||||||||||||||||||
Average aggregate invested assets, at fair value (3)
|
$ | 13,055,657 | $ | 294,798 | $ | 1,223,575 | $ | 17,168 | $ | 14,591,198 | |||||||||||||||||||
Investment return included in net earnings | 8.13 | % | 2.64 | % | 1.50 | % | (47.44) | % | 7.40 | % | |||||||||||||||||||
Total investment return | 8.45 | % | 2.64 | % | 1.66 | % | (47.44) | % | 7.70 | % |
Nine Months Ended September 30, 2019 | |||||||||||||||||||||||||||||
Non-Life Run-off | Atrium | StarStone | Other | Total | |||||||||||||||||||||||||
Net investment income: | |||||||||||||||||||||||||||||
Fixed income securities (1)
|
$ | 187,471 | $ | 4,146 | $ | 18,094 | $ | 567 | $ | 210,278 | |||||||||||||||||||
Cash and restricted cash | 7,383 | 708 | 3,568 | 382 | 12,041 | ||||||||||||||||||||||||
Other investments, including equities | 19,542 | 891 | 5,401 | (7,357) | 18,477 | ||||||||||||||||||||||||
Less: Investment expenses | (8,059) | (245) | (1,198) | 130 | (9,372) | ||||||||||||||||||||||||
Total net investment income (expense) | $ | 206,337 | $ | 5,500 | $ | 25,865 | $ | (6,278) | $ | 231,424 | |||||||||||||||||||
Net realized gains (losses): | |||||||||||||||||||||||||||||
Fixed income securities (1)
|
$ | 44,764 | $ | 41 | $ | 1,500 | $ | 4,151 | $ | 50,456 | |||||||||||||||||||
Other investments, including equities | (1,600) | 140 | 247 | — | (1,213) | ||||||||||||||||||||||||
Total net realized gains | $ | 43,164 | $ | 181 | $ | 1,747 | $ | 4,151 | $ | 49,243 | |||||||||||||||||||
Net unrealized gains: | |||||||||||||||||||||||||||||
Fixed income securities, trading (1)
|
$ | 477,098 | $ | 4,297 | $ | 26,904 | $ | — | $ | 508,299 | |||||||||||||||||||
Other investments, including equities | 295,640 | 986 | 2,623 | 1,698 | 300,947 | ||||||||||||||||||||||||
Total net unrealized gains | $ | 772,738 | $ | 5,283 | $ | 29,527 | $ | 1,698 | $ | 809,246 | |||||||||||||||||||
Total investment return included in earnings (A) | $ | 1,022,239 | $ | 10,964 | $ | 57,139 | $ | (429) | $ | 1,089,913 | |||||||||||||||||||
Other comprehensive income: | |||||||||||||||||||||||||||||
Unrealized gains (losses), on fixed income securities, AFS, net of reclassification adjustments excluding foreign exchange (B) (1)
|
$ | 1,522 | $ | 307 | $ | (26) | $ | (1,072) | $ | 731 | |||||||||||||||||||
Total investment return = (A) + (B) | $ | 1,023,761 | $ | 11,271 | $ | 57,113 | $ | (1,501) | $ | 1,090,644 | |||||||||||||||||||
Annualized income from fixed income assets (2)
|
$ | 259,805 | $ | 6,472 | $ | 28,883 | $ | 1,265 | $ | 296,425 | |||||||||||||||||||
Average aggregate fixed income assets, at cost (2)(3)
|
8,621,207 | 255,591 | 1,180,412 | 87,240 | 10,144,450 | ||||||||||||||||||||||||
Annualized investment book yield | 3.01 | % | 2.53 | % | 2.45 | % | 1.45 | % | 2.92 | % | |||||||||||||||||||
Average aggregate invested assets, at fair value (3)
|
$ | 11,314,815 | $ | 266,108 | $ | 1,345,180 | $ | 97,396 | $ | 13,023,499 | |||||||||||||||||||
Investment return included in net earnings | 9.03 | % | 4.12 | % | 4.25 | % | (0.44) | % | 8.37 | % | |||||||||||||||||||
Total investment return | 9.05 | % | 4.24 | % | 4.25 | % | (1.54) | % | 8.37 | % |
September 30, 2020 | December 31, 2019 | Change | ||||||||||||||||||
(in thousands of U.S. dollars) | ||||||||||||||||||||
Ordinary shareholders' equity | $ | 5,310,885 | $ | 4,332,183 | $ | 978,702 | ||||||||||||||
Series D and E Preferred Shares | 510,000 | 510,000 | — | |||||||||||||||||
Total Enstar Shareholders' Equity (A) | 5,820,885 | 4,842,183 | 978,702 | |||||||||||||||||
Noncontrolling interest | 14,468 | 14,168 | 300 | |||||||||||||||||
Total Shareholders' Equity (B) | 5,835,353 | 4,856,351 | 979,002 | |||||||||||||||||
Senior Notes | 843,095 | 842,216 | 879 | |||||||||||||||||
Junior Subordinated Notes | 344,813 | — | 344,813 | |||||||||||||||||
Revolving credit facility | 260,000 | — | 260,000 | |||||||||||||||||
Term loan facility | — | 348,991 | (348,991) | |||||||||||||||||
Total debt (C) | 1,447,908 | 1,191,207 | 256,701 | |||||||||||||||||
Redeemable noncontrolling interest (D) | 376,731 | 438,791 | (62,060) | |||||||||||||||||
Total capitalization = (B) + (C) + (D) | $ | 7,659,992 | $ | 6,486,349 | $ | 1,173,643 | ||||||||||||||
Total capitalization attributable to Enstar = (A) + (C) | $ | 7,268,793 | $ | 6,033,390 | $ | 1,235,403 | ||||||||||||||
Debt to total capitalization | 18.9 | % | 18.4 | % | 0.5 | % | ||||||||||||||
Debt and Series D and E Preferred Shares to total capitalization | 25.6 | % | 26.2 | % | (0.6) | % | ||||||||||||||
Debt to total capitalization attributable to Enstar | 19.9 | % | 19.7 | % | 0.2 | % | ||||||||||||||
Debt and Series D and E Preferred Shares to total capitalization available to Enstar | 26.9 | % | 28.2 | % | (1.3) | % |
Nine Months Ended September 30, | ||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||
(in thousands of U.S. dollars) | ||||||||||||||||||||
Cash provided by (used in): | ||||||||||||||||||||
Operating activities | $ | 2,104,030 | $ | 429,568 | $ | 1,674,462 | ||||||||||||||
Investing activities | (2,011,034) | (573,708) | (1,437,326) | |||||||||||||||||
Financing activities | 202,623 | 309,642 | (107,019) | |||||||||||||||||
Discontinued operations cash flows: | ||||||||||||||||||||
Net cash flows provided by operating activities | 114,024 | 210,666 | (96,642) | |||||||||||||||||
Net cash flows used in investing activities | (134,759) | (5,332) | (129,427) | |||||||||||||||||
Net cash flows from discontinued operations | (20,735) | 205,334 | (226,069) | |||||||||||||||||
Effect of exchange rate changes on cash | 1,727 | (12,507) | 14,234 | |||||||||||||||||
Net increase in cash and cash equivalents | 276,611 | 358,329 | (81,718) | |||||||||||||||||
Cash and cash equivalents, beginning of period | 971,349 | 901,996 | 69,353 | |||||||||||||||||
Net change in cash of businesses held-for-sale | (50,638) | (205,333) | 154,695 | |||||||||||||||||
Cash and cash equivalents, end of period | $ | 1,197,322 | $ | 1,054,992 | $ | 142,330 |
Facility | Origination Date | Term | September 30, 2020 | December 31, 2019 | ||||||||||||||||||||||
4.50% Senior Notes due 2022 | March 10, 2017 | 5 years | $ | 349,155 | $ | 348,616 | ||||||||||||||||||||
4.95% Senior Notes due 2029 | May 28, 2019 | 10 years | 493,940 | 493,600 | ||||||||||||||||||||||
Total Senior Notes | 843,095 | 842,216 | ||||||||||||||||||||||||
5.75% Junior Subordinated Notes due 2040 | August 26, 2020 | 20 years | 344,813 | — | ||||||||||||||||||||||
EGL Revolving Credit Facility | August 16, 2018 | 5 years | 260,000 | — | ||||||||||||||||||||||
2018 EGL Term Loan Facility | December 27, 2018 | 3 years | — | 348,991 | ||||||||||||||||||||||
Total debt obligations | $ | 1,447,908 | $ | 1,191,207 |
Total | Less than or equal to 1 year | More than 1 year - less than or equal to 3 years | More than 3 years - less than or equal to 5 years | More than 5 years - less than or equal to 10 years |
More than
10 years |
||||||||||||||||||||||||||||||
(in millions of U.S. dollars) | |||||||||||||||||||||||||||||||||||
Operating Activities | |||||||||||||||||||||||||||||||||||
Estimated gross reserves for losses and LAE (1)
|
|||||||||||||||||||||||||||||||||||
Asbestos | $ | 1,779.2 | $ | 153.8 | $ | 266.0 | $ | 219.6 | $ | 350.5 | $ | 789.3 | |||||||||||||||||||||||
Environmental | 318.6 | 35.7 | 61.3 | 49.0 | 69.7 | 102.9 | |||||||||||||||||||||||||||||
General Casualty | 1,710.4 | 207.5 | 289.5 | 305.2 | 682.4 | 225.8 | |||||||||||||||||||||||||||||
Workers' compensation/personal accident | 2,014.2 | 164.1 | 265.9 | 326.4 | 457.8 | 800.0 | |||||||||||||||||||||||||||||
Marine, aviation and transit | 348.3 | 105.2 | 108.4 | 50.7 | 44.7 | 39.3 | |||||||||||||||||||||||||||||
Construction defect | 123.1 | 34.7 | 45.0 | 21.8 | 12.9 | 8.7 | |||||||||||||||||||||||||||||
Professional indemnity/ Directors & Officers | 979.8 | 200.5 | 257.4 | 154.1 | 237.9 | 129.9 | |||||||||||||||||||||||||||||
Motor | 1,009.3 | 366.6 | 303.6 | 112.6 | 88.8 | 137.7 | |||||||||||||||||||||||||||||
Property | 145.1 | 59.2 | 46.4 | 18.6 | 12.2 | 8.7 | |||||||||||||||||||||||||||||
Other | 393.9 | 107.5 | 85.6 | 53.2 | 63.1 | 84.5 | |||||||||||||||||||||||||||||
Total Non-Life Run-off | 8,821.9 | 1,434.8 | 1,729.1 | 1,311.2 | 2,020.0 | 2,326.8 | |||||||||||||||||||||||||||||
StarStone International (Non-U.S.) | 1,310.1 | 448.4 | 466.9 | 207.3 | 152.1 | 35.4 | |||||||||||||||||||||||||||||
Other | 26.3 | 6.4 | 8.5 | 3.4 | 8.0 | — | |||||||||||||||||||||||||||||
ULAE | 371.7 | 67.5 | 83.4 | 53.9 | 70.1 | 96.8 | |||||||||||||||||||||||||||||
Estimated gross reserves for losses and LAE (1)
|
10,530.0 | 1,957.1 | 2,287.9 | 1,575.8 | 2,250.2 | 2,459.0 | |||||||||||||||||||||||||||||
Held-for-sale liabilities: StarStone U.S. gross reserves for losses and LAE(2)
|
830.5 | 246.2 | 289.4 | 152.3 | 107.0 | 35.6 | |||||||||||||||||||||||||||||
Held-for-sale liabilities : Atrium gross reserves for losses and LAE (3)
|
245.1 | 96.4 | 89.0 | 35.9 | 19.9 | 3.9 | |||||||||||||||||||||||||||||
Operating lease obligations(4)
|
45.5 | 10.2 | 15.8 | 10.2 | 7.3 | 2.0 | |||||||||||||||||||||||||||||
Atrium operating lease obligations (5)
|
1.0 | 0.6 | 0.4 | — | — | — | |||||||||||||||||||||||||||||
Investing Activities | |||||||||||||||||||||||||||||||||||
Investment commitments to other investments | 792.2 | 418.8 | 182.0 | 111.8 | 79.6 | — | |||||||||||||||||||||||||||||
Investment commitments to fixed maturities | 15.0 | 15.0 | — | — | — | — | |||||||||||||||||||||||||||||
Investment commitments to equity method investments | 68.7 | 68.7 | — | — | — | — | |||||||||||||||||||||||||||||
Financing Activities | |||||||||||||||||||||||||||||||||||
Loan repayments (including estimated interest payments) | 2,126.9 | 67.4 | 718.9 | 89.8 | 699.6 | 551.2 | |||||||||||||||||||||||||||||
Total | $ | 14,654.9 | $ | 2,880.4 | $ | 3,583.4 | $ | 1,975.8 | $ | 3,163.6 | $ | 3,051.7 |
Interest Rate Shift in Basis Points | ||||||||||||||||||||||||||||||||
As of September 30, 2020 | -100 | -50 | — | +50 | +100 | |||||||||||||||||||||||||||
(in millions of U.S. dollars) | ||||||||||||||||||||||||||||||||
Total Market Value | $ | 10,551 | $ | 10,266 | $ | 9,985 | $ | 9,712 | $ | 9,453 | ||||||||||||||||||||||
Market Value Change from Base | 5.7 | % | 2.8 | % | — | % | (2.7) | % | (5.3) | % | ||||||||||||||||||||||
Change in Unrealized Value | $ | 566 | $ | 281 | $ | — | $ | (273) | $ | (532) | ||||||||||||||||||||||
As of December 31, 2019 | -100 | -50 | — | +50 | +100 | |||||||||||||||||||||||||||
Total Market Value | $ | 10,141 | $ | 9,893 | $ | 9,648 | $ | 9,415 | $ | 9,193 | ||||||||||||||||||||||
Market Value Change from Base | 5.1 | % | 2.5 | % | — | % | (2.4) | % | (4.7) | % | ||||||||||||||||||||||
Change in Unrealized Value | $ | 493 | $ | 245 | $ | — | $ | (233) | $ | (455) |
Credit Spread Shift in Basis Points | ||||||||||||||||||||
As at September 30, 2020 | — | +50 | +100 | |||||||||||||||||
(in millions of U.S. dollars) | ||||||||||||||||||||
Total Market Value | $ | 9,985 | $ | 9,718 | $ | 9,466 | ||||||||||||||
Market Value Change from Base | (2.7) | % | (5.2) | % | ||||||||||||||||
Change in Unrealized Value | $ | (267) | $ | (519) | ||||||||||||||||
As at December 31, 2019 | — | +50 | +100 | |||||||||||||||||
Total Market Value | $ | 9,648 | $ | 9,429 | $ | 9,218 | ||||||||||||||
Market Value Change from Base | (2.3) | % | (4.5) | % | ||||||||||||||||
Change in Unrealized Value | $ | (219) | $ | (430) |
Credit rating | September 30, 2020 | December 31, 2019 | Change | ||||||||||||||
AAA | 28.1 | % | 26.0 | % | 2.1 | % | |||||||||||
AA | 12.3 | % | 13.1 | % | (0.8) | % | |||||||||||
A | 32.9 | % | 34.5 | % | (1.6) | % | |||||||||||
BBB | 23.2 | % | 21.9 | % | 1.3 | % | |||||||||||
Non-investment grade | 3.3 | % | 4.3 | % | (1.0) | % | |||||||||||
Not rated | 0.2 | % | 0.2 | % | — | % | |||||||||||
Total | 100.0 | % | 100.0 | % | |||||||||||||
Average credit rating | A+ | A+ |
September 30, 2020 | December 31, 2019 | Change | |||||||||||||||
(in millions of U.S. dollars) | |||||||||||||||||
Publicly traded equity investments in common and preferred stocks | $ | 303.9 | $ | 327.9 | $ | (24.0) | |||||||||||
Privately held equity investments in common and preferred stocks | 271.0 | 265.8 | 5.2 | ||||||||||||||
Private equity funds | 320.5 | 323.5 | (3.0) | ||||||||||||||
Equity funds | 290.1 | 410.1 | (120.0) | ||||||||||||||
Call options on equity | — | 0.1 | (0.1) | ||||||||||||||
Fair value of equities at risk | $ | 1,185.5 | $ | 1,327.4 | $ | (141.9) | |||||||||||
Impact of 10% decline in fair value | $ | 118.6 | $ | 132.7 | $ | (14.1) |
AUD | CAD | EUR | GBP | Other | Total | |||||||||||||||||||||||||||||||||
As of September 30, 2020 | (in millions of U.S. dollars) | |||||||||||||||||||||||||||||||||||||
Total net foreign currency exposure | $ | 0.7 | $ | 9.5 | $ | 72.0 | $ | (26.4) | $ | 0.5 | $ | 56.3 | ||||||||||||||||||||||||||
Pre-tax impact of a 10% movement of the U.S. dollar(1)
|
$ | 0.1 | $ | 1.0 | $ | 7.2 | $ | (2.6) | $ | 0.1 | $ | 5.6 | ||||||||||||||||||||||||||
As of December 31, 2019 | ||||||||||||||||||||||||||||||||||||||
Total net foreign currency exposure | $ | 20.2 | $ | (10.6) | $ | 12.9 | $ | (11.9) | $ | 0.6 | $ | 11.2 | ||||||||||||||||||||||||||
Pre-tax impact of a 10% movement of the U.S. dollar(1)
|
$ | 2.0 | $ | (1.1) | $ | 1.3 | $ | (1.2) | $ | 0.1 | $ | 1.1 |
Period | Total Number of Shares Purchased | Average Price Paid per Share |
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2)
|
Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Program (2)
|
||||||||||||||||||||||
Beginning dollar amount available to be repurchased | $ | 137,474 | ||||||||||||||||||||||||
July 1, 2020 - July 31, 2020 (1)
|
103 | $ | 151.66 | — | — | |||||||||||||||||||||
August 1, 2020 - August 31, 2020 | — | $ | — | — | — | |||||||||||||||||||||
September 1, 2020 - September 30, 2020 | 81,954 | $ | 156.96 | 81,954 | (12,864) | |||||||||||||||||||||
82,057 | 81,954 | $ | 124,610 |
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). | ||||||||
Junior Subordinated Indenture dated as of August 26, 2020, among Enstar Finance LLC, Enstar Group Limited and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 of the Company’s Form 8-K filed on August 26, 2020).
|
||||||||
First Supplemental Indenture dated as of August 26, 2020, among Enstar Finance LLC, Enstar Group Limited and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.2 of the Company’s Form 8-K filed on August 26, 2020).
|
||||||||
10.1*
|
Amendment No. 1 to North Bay Voting and Shareholders Agreement, dated as of July 14, 2020, among Kenmare Holdings Ltd., Trident V, L.P., Trident V Parallel Fund, L.P. and Trident V Professionals Fund, L.P. | |||||||
Transition Agreement, dated July 17, 2020, by and between Enstar Group Limited and Guy Bowker (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K filed on July 17, 2020).
|
||||||||
Recapitalization Agreement, dated as of August 13, 2020, among North Bay Holdings Limited, Enstar Group Limited, Kenmare Holdings Ltd., Trident V, L.P., Trident V Parallel Fund, L.P., Trident V Professionals Fund, L.P., Dowling Capital Partners I, L.P., Capital City Partners LLC and StarStone Specialty Holdings Limited (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K filed on August 17, 2020).
|
||||||||
22.1*
|
Subsidiary Guarantors and Issuers of Guaranteed Securities.
|
|||||||
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 | |||||||
104 | Cover page Interactive Data File (embedded within the Inline XBRL document and included in Exhibit 101) |
ENSTAR GROUP LIMITED | |||||
By: |
/S/ GUY BOWKER
|
||||
Guy Bowker
Chief Financial Officer, Authorized Signatory, Principal Financial Officer and Principal Accounting Officer |
$350 million of 5.750% Fixed-Rate Reset Junior Subordinated Notes due 2040 | Issuer | Guarantor | ||||||
Enstar Finance LLC | x | |||||||
Enstar Group Limited | x |
/S/ DOMINIC F. SILVESTER | ||
Dominic F. Silvester | ||
Chief Executive Officer |
/S/ GUY BOWKER | ||
Guy Bowker | ||
Chief Financial Officer |
/S/ DOMINIC F. SILVESTER | ||
Dominic F. Silvester | ||
Chief Executive Officer |
/S/ GUY BOWKER | ||
Guy Bowker | ||
Chief Financial Officer |