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As Of Filer Filing For·On·As Docs:Size 11/08/19 Partnerre Ltd 6-K 11/08/19 2:1.2M |
Document/Exhibit Description Pages Size 1: 6-K Current Report by a Foreign Issuer HTML 18K 2: EX-99.1 Miscellaneous Exhibit HTML 412K
Exhibit |
▪ | Net
income available to common shareholder of $216 million for the third quarter and common shareholder's book value growth, excluding dividends on common shares, of 3.2% compared to June 30, 2019 |
▪ | Non-life combined ratio of 96.4% during the third quarter, including $93 million pre-tax losses (6.9 points) from Hurricane Dorian and Typhoon Faxai, compared with a combined ratio of 107.8%
in the prior year. Non-Life net premiums written increased 17% to $1.26 billion |
▪ | Life and Health profitability, including underwriting result and allocated net investment income, of $31 million for the third quarter, a $13 million increase compared to the prior year. Life and Health net premiums written increased 19% to $352 million |
▪ | Total
investment return of $225 million (1.3%) for the third quarter, driven by $109 million net investment income (up 5% compared to the prior year) and $114 million net realized and unrealized gains |
PartnerRe
Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08 | Telephone +1 441 292 0888 Fax +1 441 292 6080 | 1 |
PartnerRe Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08 | Telephone +1 441 292 0888 Fax +1 441 292 6080 | 2 |
▪ | Non-life net premiums written for the third quarter of 2019 were up 17% compared to the third quarter of 2018, driven by a 12% increase in the P&C segment, and a 25%
increase in the Specialty segment. |
▪ | Non-life net premiums written were up 19% for the first nine months of 2019 compared to the same period of 2018, driven by a 23% increase in the P&C segment and 14% increase in the Specialty segment. |
▪ | The Non-life underwriting profit was $49
million (combined ratio of 96.4%) for the third quarter of 2019 compared to a loss of $87 million (combined ratio of 107.8%) for the same period of 2018. The increase in underwriting profit was driven by the P&C segment which reported a combined ratio of 99.4% for the third quarter of 2019 compared to 114.7% for the third quarter of 2018, with the improvement driven by a reduction in the attritional
loss ratio and a decrease in losses related to large catastrophic events. Catastrophic losses included Hurricane Dorian and Typhoon Faxai of $93 million, pre-tax, net of retrocession and reinstatement premiums, or 11.5 points on the P&C combined ratio, compared to $120 million or 17.9 points on the combined ratio related to Typhoons Jebi and Trami and Hurricane Florence in the third quarter of 2018. The Specialty segment also recorded an improved combined ratio of 91.7% for the third quarter of 2019 compared to 97.4% for the same period of 2018, driven primarily by lower attritional losses on the current accident year. |
▪ | The
Non-life underwriting profit was $168 million (combined ratio of 95.5%) for the first nine months of 2019 compared to $20 million (combined ratio of 99.4%) for the same period of 2018. The increase was driven by the P&C segment with a combined ratio of 91.4% for the first nine months of 2019 compared to 104.4% for the same period of 2018, reflecting an improvement in the current accident year attritional loss ratio and a decrease in losses related to large catastrophic events. This was partially offset by the Specialty
segment, which recorded a combined ratio of 101.6% for the first nine months of 2019 compared to 92.4% for the same period of 2018, driven by net adverse prior years' reserve development and a large aviation loss related to Ethiopian Airlines and Boeing of $43 million (2.9 points on the Specialty combined ratio), net of retrocession and reinstatement premiums. |
▪ | The Non-life combined ratio was impacted by net adverse prior year development of $3
million (0.2 points) and $18 million (0.5 points) for the third quarter and first nine months of 2019, respectively. This compared to net favorable prior year development of $32 million (2.9 points) and $102 million (3.2 points) for the third quarter and first nine months of 2018, respectively. |
PartnerRe Ltd. Wellesley
House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08 | Telephone +1 441 292 0888 Fax +1 441 292 6080 | 3 |
▪ | Net premiums written were up 19% in the third quarter of 2019, and up 21% for the first nine months of 2019 compared to the same period of 2018. |
▪ | Allocated
underwriting result was a profit of $31 million and $75 million for the third quarter and first nine months of 2019, respectively, compared to $18 million and $69 million for the third quarter and first nine months of 2018, respectively. |
▪ | Net investment return in the third quarter
of 2019 was $225 million, or 1.3%, driven by net investment income of $109 million, net realized and unrealized investment gains of $114 million and interest in earnings of equity method investments of $2 million. This compares to a net investment return of $63 million, or 0.4%, for the third quarter of 2018, which included net investment income of $104 million and net realized and unrealized investment losses of $41 million. |
▪ | Net
investment return for the first nine months of 2019 was $1,143 million, or 6.6%, which included net investment income of $340 million, net realized and unrealized investment gains of $765 million, and interest in earnings of equity method investments of $38 million. This compares to a net investment return of $3 million for the first nine months of 2018, which included net investment income of $312 million, net realized and unrealized investment losses of $337 million, and interest in earnings of equity method investments of $28 million.
|
▪ | Net investment income was up $5 million, or 5%, for the third quarter of 2019 and up $28 million, or 9% for the first nine months of 2019, compared to the same periods of 2018. This was driven primarily by actions taken during the fourth quarter of 2018 and during the first quarter of 2019 to improve the yield on the fixed income and alternative credit portfolios. |
PartnerRe
Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08 | Telephone +1 441 292 0888 Fax +1 441 292 6080 | 4 |
▪ | Net realized and unrealized investment gains of $114 million and $765 million in the third quarter and first nine months of 2019, respectively, were driven by $41 million and $484 million, respectively, of net realized and unrealized investment gains on fixed maturities and short-term investments, and $73 million and $281 million,
respectively, of net realized and unrealized investment gains on equities, investments in real estate and other invested assets, primarily due to gains in public equity funds. Included within the $41 million and $484 million of net realized and unrealized investment gains on fixed maturities and short-term investments for the third quarter and first nine months of 2019, respectively, was $70 million and $222 million, respectively, of net realized gains primarily driven by the Company's decisions to rebalance certain portfolios to lock in fully valued gains, particularly in lower rated investment grade credit, and
to reallocate the proceeds to other investment classes, particularly to highly rated governments and mortgage backed securities, and to alternative credit. This compared to net realized and unrealized investment losses of $41 million and $337 million in the third quarter and first nine months of 2018, respectively, which included $73 million and $407 million, respectively, of net realized and unrealized investment losses on fixed maturities and short-term investments, and $33 million and $69 million, respectively, of net realized and unrealized investment gains on equities, investments in real estate and other
invested assets. |
▪ | The interest in earnings of equity method investments of $2 million and $38 million in the third quarter and first nine months of 2019, respectively, was primarily driven by an appreciation in value of certain real estate investments held, and for the first nine months of 2019, also reflected gains on private equity investments. This compared to gains of $0 million and $28 million for the same periods of 2018. |
▪ | As
at September 30, 2019, reinvestment rates were 2.7% compared to the Company's fixed income investment portfolio yield of 2.9% for the third quarter of 2019. |
▪ | Expense ratio of 4.7% for the third quarter of 2019 (Other expenses of $80 million) was down 0.2 percentage points compared to expense ratio of 4.9% (Other
expenses of $69 million) for the same period of 2018. Expense ratio of 5.3% for the first nine months of 2019 (Other expenses of $255 million) was down 0.4 percentage points compared to expense ratio of 5.7% (Other expenses of $232 million) for the same period of 2018. |
PartnerRe Ltd. Wellesley House, 5th Floor 90
Pitts Bay Road Pembroke, Bermuda HM 08 | Telephone +1 441 292 0888 Fax +1 441 292 6080 | 5 |
▪ | Net
foreign exchange gains were $39 million in the third quarter of 2019, driven by the U.S. dollar strengthening against most major currencies partially offset by the cost of hedging, compared to losses of $16 million for the third quarter of 2018, driven by the U.S. dollar weakening against certain major currencies. Net foreign exchange losses were $8 million for the first nine months of 2019, driven primarily by the cost of hedging, compared to gains of $53 million for the same period of 2018, driven by the appreciation of the U.S. dollar against most major currencies partially offset by hedging costs. |
▪ | Interest
expense was $10 million and $32 million for the third quarter and the first nine months of 2019, respectively, while preferred dividends were $12 million and $35 million for the third quarter and first nine months of 2019, respectively, and were comparable to the same periods of 2018. |
▪ | Loss on redemption of debt was $15
million for the third quarter and first nine months of 2019, related to the redemption of the Company's 5.50% Senior Notes due 2020 at a make-whole redemption price. |
▪ | Income tax expense was $29 million on pre-tax income of $257 million in the third quarter of 2019 compared to an expense of $10 million on pre-tax losses of $84 million
for the same period of 2018. Income tax expense was $104 million on pre-tax income of $1,137 million for the first nine months of 2019 compared to a expense of $4 million on pre-tax losses of $61 million for the first nine months of 2018. These amounts were primarily driven by the geographical distribution of pre-tax profits and losses. |
▪ | Total
investments and cash and cash equivalents were $17.6 billion at September 30, 2019, up 8.1% compared to December 31, 2018. The increase to September 30, 2019 was primarily driven by the $1,143 million net investment return for the first nine months of 2019 and the increase in payable for securities purchased to $432 million as at September 30, 2019 from $80 million
as at December 31, 2018. |
▪ | Cash and cash equivalents, fixed maturities, and short-term investments, which are government issued or investment grade fixed income securities, were $13.0 billion at September 30, 2019, representing 74% of the total investments and cash and cash equivalents. |
▪ | The
average credit rating of the fixed income portfolio has increased to AA as of September 30, 2019 from A at December 31, 2018. The improvement in the average credit quality of the fixed income portfolio was due to actions taken during 2019 to reduce exposure to lower rated investment grade credit and reinvest certain proceeds in highly rated governments and mortgage backed securities. The expected average duration of the public fixed income portfolio at September 30, 2019 was 3.0 years, while the average duration of the Company’s liabilities was 4.8 years. |
PartnerRe
Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08 | Telephone +1 441 292 0888 Fax +1 441 292 6080 | 6 |
▪ | Dividends declared and paid to common shareholders in the third quarter and first nine months of 2019 was $120 million and $200 million, respectively. This compares to no dividends being declared or paid in the third quarter of 2018 and $48 million for the first nine months of 2018. |
▪ | Total
capital was $8.7 billion at September 30, 2019, up 9.9% compared to December 31, 2018, primarily due to net income for the first nine months of 2019, partially offset by dividends on preferred and common shares. The Company issued $500 million 3.70% Senior Notes due 2029 during the second quarter of 2019 and used the proceeds to early redeem the $500 million 5.50% Senior Notes due 2020 in the third quarter of 2019. |
▪ | Common
shareholder's equity (or book value) of $6.6 billion and tangible book value of $6.1 billion at September 30, 2019 increased by 14.2% and 15.9%, respectively, compared to December 31, 2018, primarily due to the net income available to common shareholder for the first nine months of 2019, partially offset by dividends on common shares. Book value, excluding dividends on common shares for the first nine months of 2019, was up 17.7% compared to December 31,
2018. |
▪ | Cash provided by operating activities, which include cash flows related to net investment income and underwriting operations, was $394 million in the third quarter of 2019 compared to $237 million in the third quarter of 2018 and $704 million for the first nine months of 2019 compared to $329 million
for the same period of 2018. The increases for the third quarter and first nine months of 2019 over the same periods of 2018 were primarily driven by increases in cash flow from underwriting operations. |
PartnerRe Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08 | Telephone
+1 441 292 0888 Fax +1 441 292 6080 | 7 |
Contacts: | PartnerRe
Ltd. | |
(441) 292-0888 | ||
Investor Contact: Ryan Lipschutz | ||
Media Contact: Celia Powell |
PartnerRe
Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08 | Telephone +1 441 292 0888 Fax +1 441 292 6080 | 8 |
For the three months ended | For
the nine months ended | ||||||||||||||
Revenues | |||||||||||||||
Gross
premiums written | $ | 1,706,139 | $ | 1,504,197 | $ | 5,732,283 | $ | 4,986,144 | |||||||
Net
premiums written | $ | 1,614,276 | $ | 1,374,117 | $ | 5,397,235 | $ | 4,516,872 | |||||||
Decrease
(increase) in unearned premiums | 82,295 | 45,447 | (607,399 | ) | (438,246 | ) | |||||||||
Net premiums earned | 1,696,571 | 1,419,564 | 4,789,836 | 4,078,626 | |||||||||||
Net
investment income | 109,423 | 104,398 | 340,318 | 312,036 | |||||||||||
Net realized and unrealized investment gains (losses) | 113,594 | (41,323 | ) | 764,522 | (337,492 | ) | |||||||||
Other
income | 3,806 | 7,225 | 11,376 | 16,398 | |||||||||||
Total revenues | 1,923,394 | 1,489,864 | 5,906,052 | 4,069,568 | |||||||||||
Expenses | |||||||||||||||
Losses
and loss expenses | 1,224,862 | 1,156,142 | 3,429,349 | 3,024,631 | |||||||||||
Acquisition costs | 375,317 | 315,534 | 1,059,474 | 905,546 | |||||||||||
Other
expenses | 79,645 | 68,708 | 254,668 | 232,225 | |||||||||||
Interest expense | 10,011 | 10,751 | 31,857 | 32,384 | |||||||||||
Loss
on redemption of debt (2) | 15,175 | — | 15,175 | — | |||||||||||
Amortization of intangible assets | 2,795 | 5,922 | 8,505 | 17,677 | |||||||||||
Net
foreign exchange (gains) losses | (38,834 | ) | 16,588 | 8,308 | (53,314 | ) | |||||||||
Total expenses | 1,668,971 | 1,573,645 | 4,807,336 | 4,159,149 | |||||||||||
Income
(loss) before taxes and interest in earnings of equity method investments | 254,423 | (83,781 | ) | 1,098,716 | (89,581 | ) | |||||||||
Income tax expense | 29,130 | 10,389 | 103,639 | 4,591 | |||||||||||
Interest
in earnings of equity method investments | 2,455 | 39 | 37,852 | 28,213 | |||||||||||
Net income (loss) | 227,748 | (94,131 | ) | 1,032,929 | (65,959 | ) | |||||||||
Preferred
dividends | 11,604 | 11,604 | 34,812 | 34,812 | |||||||||||
Net income (loss) available to common shareholder | $ | 216,144 | $ | (105,735 | ) | $ | 998,117 | $ | (100,771 | ) | |||||
Comprehensive
income (loss) | |||||||||||||||
Net income (loss) | $ | 227,748 | $ | (94,131 | ) | $ | 1,032,929 | $ | (65,959 | ) | |||||
Change
in currency translation adjustment | (7,871 | ) | 9,789 | 29,683 | (32,311 | ) | |||||||||
Change in net unrealized gains or losses on investments, net of tax | (63 | ) | (73 | ) | (1,965 | ) | (220 | ) | |||||||
Change
in unfunded pension obligation, net of tax | 94 | (838 | ) | 45 | (724 | ) | |||||||||
Comprehensive income (loss) | $ | 219,908 | $ | (85,253 | ) | $ | 1,060,692 | $ | (99,214 | ) |
Assets | |||||||
Investments: | |||||||
Fixed
maturities, at fair value | $ | 11,487,739 | $ | 12,639,845 | |||
Short-term investments, at fair value | 592,724 | 493,726 | |||||
Equities,
at fair value | 1,080,985 | 694,301 | |||||
Investments in real estate | 70,226 | 72,573 | |||||
Other invested assets | 3,027,946 | 1,488,995 | |||||
Total
investments | 16,259,620 | 15,389,440 | |||||
Cash and cash equivalents | 1,331,199 | 877,907 | |||||
Accrued investment income | 109,378 | 115,735 | |||||
Reinsurance
balances receivable | 3,502,647 | 2,976,644 | |||||
Reinsurance recoverable on paid and unpaid losses | 962,168 | 940,291 | |||||
Funds held by reinsured
companies | 781,366 | 829,695 | |||||
Deferred acquisition costs | 874,444 | 743,046 | |||||
Deposit assets | 169,191 | 80,661 | |||||
Net
tax assets | 127,295 | 157,690 | |||||
Goodwill | 456,380 | 456,380 | |||||
Intangible assets | 120,466 | 128,899 | |||||
Other
assets (1) | 158,687 | 63,506 | |||||
Total assets | $ | 24,852,841 | $ | 22,759,894 | |||
Liabilities | |||||||
Non-life
reserves | $ | 9,910,360 | $ | 9,895,376 | |||
Life and health reserves | 2,182,634 | 2,198,080 | |||||
Unearned
premiums | 2,690,088 | 2,072,953 | |||||
Other reinsurance balances payable | 489,613 | 281,744 | |||||
Deposit liabilities | 7,469 | 7,172 | |||||
Net
tax liabilities | 137,475 | 101,525 | |||||
Accounts payable, accrued expenses and other (1) (2) | 714,004 | 266,524 | |||||
Debt
related to senior notes | 1,308,102 | 1,349,017 | |||||
Debt related to capital efficient notes | 70,089 | 70,989 | |||||
Total liabilities | 17,509,834 | 16,243,380 | |||||
Shareholders’
Equity | |||||||
Common shares (par value $0.00000001; issued and outstanding: 100,000,000 shares) | — | — | |||||
Preferred shares (par value $1.00; issued and outstanding: 28,169,062 shares; aggregate liquidation value: $704,227) | 28,169 | 28,169 | |||||
Additional
paid-in capital | 2,396,530 | 2,396,530 | |||||
Accumulated other comprehensive loss | (110,871 | ) | (138,634 | ) | |||
Retained earnings | 5,029,179 | 4,230,449 | |||||
Total
shareholders’ equity | 7,343,007 | 6,516,514 | |||||
Total liabilities and shareholders’ equity | $ | 24,852,841 | $ | 22,759,894 |
For the three months ended | For
the nine months ended | |||||||||||||||
Net
cash provided by operating activities | $ | 394,452 | $ | 237,228 | $ | 703,683 | $ | 328,582 | ||||||||
Net
cash (used in) provided by investing activities | (598,121 | ) | (280,274 | ) | 11,439 | (1,164,179 | ) | |||||||||
Net
cash used in financing activities | (649,890 | ) | (11,604 | ) | (256,264 | ) | (82,647 | ) | ||||||||
Effect of
foreign exchange rate changes on cash | (9,429 | ) | (4,125 | ) | (5,566 | ) | 20,712 | |||||||||
(Decrease)
increase in cash and cash equivalents | (862,988 | ) | (58,775 | ) | 453,292 | (897,532 | ) | |||||||||
Cash
and cash equivalents - beginning of period | 2,194,187 | 933,255 | 877,907 | 1,772,012 | ||||||||||||
Cash
and cash equivalents - end of period | $ | 1,331,199 | $ | 874,480 | $ | 1,331,199 | $ | 874,480 |
For the three months ended September
30, 2019 | ||||||||||||||||||||||||
P&C segment | Specialty segment | Total Non-life | Life and Health segment | Corporate and Other | Total | |||||||||||||||||||
Gross
premiums written | $ | 799 | $ | 552 | $ | 1,351 | $ | 355 | $ | — | $ | 1,706 | ||||||||||||
Net
premiums written | $ | 709 | $ | 554 | $ | 1,263 | $ | 352 | $ | — | $ | 1,615 | ||||||||||||
Decrease
(increase) in unearned premiums | 101 | (23 | ) | 78 | 4 | — | 82 | |||||||||||||||||
Net
premiums earned | $ | 810 | $ | 531 | $ | 1,341 | $ | 356 | $ | — | $ | 1,697 | ||||||||||||
Losses
and loss expenses | (584 | ) | (340 | ) | (924 | ) | (301 | ) | — | (1,225 | ) | |||||||||||||
Acquisition
costs | (203 | ) | (141 | ) | (344 | ) | (31 | ) | — | (375 | ) | |||||||||||||
Technical
result | $ | 23 | $ | 50 | $ | 73 | $ | 24 | $ | — | $ | 97 | ||||||||||||
Other
income | — | — | — | 4 | — | 4 | ||||||||||||||||||
Other
expenses | (18 | ) | (6 | ) | (24 | ) | (16 | ) | (40 | ) | (80 | ) | ||||||||||||
Underwriting
result | $ | 5 | $ | 44 | $ | 49 | $ | 12 | n/a | $ | 21 | |||||||||||||
Net
investment income | 19 | 90 | 109 | |||||||||||||||||||||
Allocated
underwriting result | $ | 31 | n/a | n/a | ||||||||||||||||||||
Net
realized and unrealized investment gains | 114 | 114 | ||||||||||||||||||||||
Interest
expense | (10 | ) | (10 | ) | ||||||||||||||||||||
Loss
on redemption of debt | (15 | ) | (15 | ) | ||||||||||||||||||||
Amortization
of intangible assets | (3 | ) | (3 | ) | ||||||||||||||||||||
Net
foreign exchange gains | 39 | 39 | ||||||||||||||||||||||
Income
tax expense | (29 | ) | (29 | ) | ||||||||||||||||||||
Interest
in earnings of equity method investments | 2 | 2 | ||||||||||||||||||||||
Net
income | n/a | $ | 228 | |||||||||||||||||||||
Loss
ratio (1) | 72.1 | % | 64.0 | % | 68.9 | % | ||||||||||||||||||
Acquisition
ratio (2) | 25.1 | 26.6 | 25.7 | |||||||||||||||||||||
Technical
ratio (3) | 97.2 | % | 90.6 | % | 94.6 | % | ||||||||||||||||||
Other
expense ratio (4) | 2.2 | 1.1 | 1.8 | |||||||||||||||||||||
Combined
ratio (5) | 99.4 | % | 91.7 | % | 96.4 | % | ||||||||||||||||||
For
the three months ended September 30, 2018 | ||||||||||||||||||||||||
P&C segment | Specialty segment | Total Non-life | Life and Health segment | Corporate and Other | Total | |||||||||||||||||||
Gross
premiums written | $ | 729 | $ | 475 | $ | 1,204 | $ | 300 | $ | — | $ | 1,504 | ||||||||||||
Net
premiums written | $ | 635 | $ | 442 | $ | 1,077 | $ | 297 | $ | — | $ | 1,374 | ||||||||||||
Decrease
in unearned premiums | 36 | 4 | 40 | 5 | — | 45 | ||||||||||||||||||
Net
premiums earned | $ | 671 | $ | 446 | $ | 1,117 | $ | 302 | $ | — | $ | 1,419 | ||||||||||||
Losses
and loss expenses | (590 | ) | (304 | ) | (894 | ) | (262 | ) | — | (1,156 | ) | |||||||||||||
Acquisition
costs | (162 | ) | (123 | ) | (285 | ) | (30 | ) | — | (315 | ) | |||||||||||||
Technical
result | $ | (81 | ) | $ | 19 | $ | (62 | ) | $ | 10 | $ | — | $ | (52 | ) | |||||||||
Other
income | — | — | — | 3 | 4 | 7 | ||||||||||||||||||
Other
expenses | (18 | ) | (7 | ) | (25 | ) | (11 | ) | (33 | ) | (69 | ) | ||||||||||||
Underwriting
result | $ | (99 | ) | $ | 12 | $ | (87 | ) | $ | 2 | n/a | $ | (114 | ) | ||||||||||
Net
investment income | 16 | 88 | 104 | |||||||||||||||||||||
Allocated
underwriting result | $ | 18 | n/a | n/a | ||||||||||||||||||||
Net
realized and unrealized investment losses | (41 | ) | (41 | ) | ||||||||||||||||||||
Interest
expense | (11 | ) | (11 | ) | ||||||||||||||||||||
Amortization
of intangible assets | (6 | ) | (6 | ) | ||||||||||||||||||||
Net
foreign exchange losses | (16 | ) | (16 | ) | ||||||||||||||||||||
Income
tax expense | (10 | ) | (10 | ) | ||||||||||||||||||||
Net
loss | n/a | $ | (94 | ) | ||||||||||||||||||||
Loss
ratio (1) | 87.9 | % | 68.0 | % | 80.0 | % | ||||||||||||||||||
Acquisition
ratio (2) | 24.1 | 27.8 | 25.6 | |||||||||||||||||||||
Technical
ratio (3) | 112.0 | % | 95.8 | % | 105.6 | % | ||||||||||||||||||
Other
expense ratio (4) | 2.7 | 1.6 | 2.2 | |||||||||||||||||||||
Combined
ratio (5) | 114.7 | % | 97.4 | % | 107.8 | % |
(1) | Loss
ratio is obtained by dividing losses and loss expenses by net premiums earned. |
(2) | Acquisition ratio is obtained by dividing acquisition costs by net premiums earned. |
(3) | Technical ratio is defined as the sum of the loss ratio and the acquisition ratio. |
(4) | Other expense ratio is obtained
by dividing other expenses by net premiums earned. |
(5) | Combined ratio is defined as the sum of the technical ratio and the other expense ratio. |
For
the nine months ended September 30, 2019 | ||||||||||||||||||||||||
P&C segment | Specialty segment | Total Non-life | Life and Health segment | Corporate and
Other | Total | |||||||||||||||||||
Gross premiums written | $ | 2,933 | $ | 1,690 | $ | 4,623 | $ | 1,109 | $ | — | $ | 5,732 | ||||||||||||
Net
premiums written | $ | 2,671 | $ | 1,633 | $ | 4,304 | $ | 1,093 | $ | — | $ | 5,397 | ||||||||||||
Increase
in unearned premiums | (444 | ) | (155 | ) | (599 | ) | (8 | ) | — | (607 | ) | |||||||||||||
Net
premiums earned | $ | 2,227 | $ | 1,478 | $ | 3,705 | $ | 1,085 | $ | — | $ | 4,790 | ||||||||||||
Losses
and loss expenses | (1,421 | ) | (1,094 | ) | (2,515 | ) | (914 | ) | — | (3,429 | ) | |||||||||||||
Acquisition
costs | (559 | ) | (387 | ) | (946 | ) | (113 | ) | — | (1,059 | ) | |||||||||||||
Technical
result | $ | 247 | $ | (3 | ) | $ | 244 | $ | 58 | $ | — | $ | 302 | |||||||||||
Other
income | — | — | — | 9 | 2 | 11 | ||||||||||||||||||
Other
expenses | (56 | ) | (20 | ) | (76 | ) | (45 | ) | (134 | ) | (255 | ) | ||||||||||||
Underwriting
result | $ | 191 | $ | (23 | ) | $ | 168 | $ | 22 | n/a | $ | 58 | ||||||||||||
Net
investment income | 53 | 287 | 340 | |||||||||||||||||||||
Allocated
underwriting result | $ | 75 | n/a | n/a | ||||||||||||||||||||
Net
realized and unrealized investment gains | 765 | 765 | ||||||||||||||||||||||
Interest
expense | (32 | ) | (32 | ) | ||||||||||||||||||||
Loss
on redemption of debt | (15 | ) | (15 | ) | ||||||||||||||||||||
Amortization
of intangible assets | (9 | ) | (9 | ) | ||||||||||||||||||||
Net
foreign exchange losses | (8 | ) | (8 | ) | ||||||||||||||||||||
Income
tax expense | (104 | ) | (104 | ) | ||||||||||||||||||||
Interest
in earnings of equity method investments | 38 | 38 | ||||||||||||||||||||||
Net
income | n/a | $ | 1,033 | |||||||||||||||||||||
Loss
ratio | 63.8 | % | 74.0 | % | 67.9 | % | ||||||||||||||||||
Acquisition
ratio | 25.1 | 26.2 | 25.5 | |||||||||||||||||||||
Technical
ratio | 88.9 | % | 100.2 | % | 93.4 | % | ||||||||||||||||||
Other
expense ratio | 2.5 | 1.4 | 2.1 | |||||||||||||||||||||
Combined
ratio | 91.4 | % | 101.6 | % | 95.5 | % | ||||||||||||||||||
For
the nine months ended September 30, 2018 | ||||||||||||||||||||||||
P&C segment | Specialty segment | Total Non-life | Life and Health segment | Corporate and
Other | Total | |||||||||||||||||||
Gross premiums written | $ | 2,465 | $ | 1,606 | $ | 4,071 | $ | 915 | $ | — | $ | 4,986 | ||||||||||||
Net
premiums written | $ | 2,179 | $ | 1,438 | $ | 3,617 | $ | 900 | $ | — | $ | 4,517 | ||||||||||||
Increase
in unearned premiums | (332 | ) | (102 | ) | (434 | ) | (4 | ) | — | (438 | ) | |||||||||||||
Net
premiums earned | $ | 1,847 | $ | 1,336 | $ | 3,183 | $ | 896 | $ | — | $ | 4,079 | ||||||||||||
Losses
and loss expenses | (1,428 | ) | (837 | ) | (2,265 | ) | (760 | ) | — | (3,025 | ) | |||||||||||||
Acquisition
costs | (441 | ) | (376 | ) | (817 | ) | (89 | ) | — | (906 | ) | |||||||||||||
Technical
result | $ | (22 | ) | $ | 123 | $ | 101 | $ | 47 | $ | — | $ | 148 | |||||||||||
Other
income | — | — | — | 10 | 6 | 16 | ||||||||||||||||||
Other
expenses | (59 | ) | (22 | ) | (81 | ) | (36 | ) | (115 | ) | (232 | ) | ||||||||||||
Underwriting
result | $ | (81 | ) | $ | 101 | $ | 20 | $ | 21 | n/a | $ | (68 | ) | |||||||||||
Net
investment income | 48 | 264 | 312 | |||||||||||||||||||||
Allocated
underwriting result | $ | 69 | n/a | n/a | ||||||||||||||||||||
Net
realized and unrealized investment losses | (337 | ) | (337 | ) | ||||||||||||||||||||
Interest
expense | (32 | ) | (32 | ) | ||||||||||||||||||||
Amortization
of intangible assets | (18 | ) | (18 | ) | ||||||||||||||||||||
Net
foreign exchange gains | 53 | 53 | ||||||||||||||||||||||
Income
tax expense | (4 | ) | (4 | ) | ||||||||||||||||||||
Interest
in earnings of equity method investments | 28 | 28 | ||||||||||||||||||||||
Net
loss | n/a | $ | (66 | ) | ||||||||||||||||||||
Loss
ratio | 77.4 | % | 62.6 | % | 71.2 | % | ||||||||||||||||||
Acquisition
ratio | 23.8 | 28.2 | 25.7 | |||||||||||||||||||||
Technical
ratio | 101.2 | % | 90.8 | % | 96.9 | % | ||||||||||||||||||
Other
expense ratio | 3.2 | 1.6 | 2.5 | |||||||||||||||||||||
Combined
ratio | 104.4 | % | 92.4 | % | 99.4 | % |
Investments: | ||||||||||||||
Fixed
maturities | ||||||||||||||
U.S. government | $ | 1,113,907 | 7 | % | $ | 2,343,278 | 15 | % | ||||||
U.S.
government sponsored enterprises | 777,968 | 5 | 1,730 | — | ||||||||||
U.S. states, territories and municipalities | 152,886 | 1 | 134,593 | 1 | ||||||||||
Non-U.S.
sovereign government, supranational and government related | 3,326,223 | 20 | 2,158,642 | 14 | ||||||||||
Corporate
bonds | 3,047,768 | 19 | 5,611,678 | 36 | ||||||||||
Mortgage/asset-backed securities | 3,068,987 | 19 | 2,389,924 | 16 | ||||||||||
Total
fixed maturities | 11,487,739 | 71 | 12,639,845 | 82 | ||||||||||
Short-term investments | 592,724 | 4 | 493,726 | 3 | ||||||||||
Equities | 1,080,985 | 6 | 694,301 | 5 | ||||||||||
Investments
in real estate | 70,226 | — | 72,573 | — | ||||||||||
Other invested assets (1) | 3,027,946 | 19 | 1,488,995 | 10 | ||||||||||
Total
investments | $ | 16,259,620 | 100 | % | $ | 15,389,440 | 100 | % | ||||||
Cash
and cash equivalents | 1,331,199 | 877,907 | ||||||||||||
Total investments and cash and cash equivalents | 17,590,819 | 16,267,347 | ||||||||||||
Maturity
distribution: | ||||||||||||||
One year or less | $ | 1,059,561 | 9 | % | $ | 898,455 | 7 | % | ||||||
More
than one year through five years | 4,563,469 | 38 | 5,821,125 | 45 | ||||||||||
More than five years through ten
years | 2,725,469 | 23 | 3,203,473 | 24 | ||||||||||
More than ten years | 662,977 | 5 | 820,594 | 6 | ||||||||||
Subtotal | 9,011,476 | 75 | 10,743,647 | 82 | ||||||||||
Mortgage/asset-backed
securities | 3,068,987 | 25 | 2,389,924 | 18 | ||||||||||
Total fixed maturities and short-term investments | $ | 12,080,463 | 100 | % | $ | 13,133,571 | 100 | % | ||||||
Credit
quality by market value (Total fixed maturities and short-term investments): | ||||||||||||||
AAA | $ | 2,971,755 | 25 | % | $ | 1,167,970 | 9 | % | ||||||
AA | 5,479,815 | 45 | 5,845,502 | 44 | ||||||||||
A | 2,066,999 | 17 | 2,653,345 | 20 | ||||||||||
BBB | 1,125,104 | 9 | 2,985,983 | 23 | ||||||||||
Below
Investment Grade/Unrated | 436,790 | 4 | 480,771 | 4 | ||||||||||
$ | 12,080,463 | 100 | % | $ | 13,133,571 | 100 | % | |||||||
Expected
average duration | 3.0 | Yrs | 3.9 | Yrs | ||||||||||
Average yield to maturity at market | 2.7 | % | 3.2 | % | ||||||||||
Average
credit quality | AA | A |
Fair Value | Percentage of Fair Value of Corporate
Bonds | Percentage to Invested Assets and cash | Largest single issuer as a percentage of Invested Assets and cash | ||||||||||||||||||||
Distribution
by sector - Corporate bonds | |||||||||||||||||||||||
Financial | $ | 1,392,974 | 45.7 | % | 7.9 | % | 0.6 | % | |||||||||||||||
Insurance | 312,976 | 10.3 | 1.8 | 0.5 | |||||||||||||||||||
Consumer,
Non-cyclical | 292,197 | 9.6 | 1.7 | 0.4 | |||||||||||||||||||
Consumer,
Cyclical | 277,368 | 9.1 | 1.6 | 0.6 | |||||||||||||||||||
Energy | 248,805 | 8.2 | 1.4 | 0.2 | |||||||||||||||||||
Industrial | 152,296 | 5.0 | 0.9 | 0.2 | |||||||||||||||||||
Utilities | 118,055 | 3.9 | 0.7 | 0.1 | |||||||||||||||||||
Real
estate and real estate investment trusts | 99,197 | 3.3 | 0.5 | 0.1 | |||||||||||||||||||
Communications | 75,847 | 2.5 | 0.4 | 0.1 | |||||||||||||||||||
Basic
Materials | 31,827 | 1.0 | 0.2 | 0.1 | |||||||||||||||||||
Technology | 27,395 | 0.9 | 0.2 | 0.1 | |||||||||||||||||||
Longevity
and Mortality Bonds | 18,688 | 0.5 | 0.1 | 0.1 | |||||||||||||||||||
Other
| 143 | — | — | — | |||||||||||||||||||
Total
Corporate bonds | $ | 3,047,768 | 100.0 | % | 17.4 | % | |||||||||||||||||
Finance
sector - Corporate bonds | |||||||||||||||||||||||
Banks | $ | 919,722 | 30.2 | % | 5.2 | % | |||||||||||||||||
Investment
banking and brokerage | 251,873 | 8.3 | 1.4 | ||||||||||||||||||||
Other
| 221,379 | 7.2 | 1.3 | ||||||||||||||||||||
Total
finance sector - Corporate bonds | $ | 1,392,974 | 45.7 | % | 7.9 | % | |||||||||||||||||
AAA | AA | A | BBB | Non-Investment Grade/Unrated | Total | ||||||||||||||||||
Credit
quality of finance sector - Corporate bonds | |||||||||||||||||||||||
Banks | $ | — | $ | 123,026 | $ | 406,544 | $ | 333,991 | $ | 56,161 | $ | 919,722 | |||||||||||
Investment
banking and brokerage | — | 1,584 | 59,384 | 188,047 | 2,858 | 251,873 | |||||||||||||||||
Other
| 1,157 | 91,499 | 76,066 | 48,145 | 4,512 | 221,379 | |||||||||||||||||
Total
finance sector - Corporate bonds | $ | 1,157 | $ | 216,109 | $ | 541,994 | $ | 570,183 | $ | 63,531 | $ | 1,392,974 | |||||||||||
%
of total | 0.1 | % | 15.5 | % | 38.9 | % | 40.9 | % | 4.6 | % | 100.0 | % |
For the three months ended | For
the nine months ended | ||||||||||||||
Fixed maturities | $ | 89,552 | $ | 93,517 | $ | 298,059 | $ | 282,915 | |||||||
Short-term
investments and cash and cash equivalents | 5,364 | 3,567 | 20,037 | 9,335 | |||||||||||
Equities, investments in real estate, funds held and other | 25,670 | 12,760 | 49,832 | 39,293 | |||||||||||
Investment
expenses | (11,163 | ) | (5,446 | ) | (27,610 | ) | (19,507 | ) | |||||||
Net investment income | $ | 109,423 | $ | 104,398 | $ | 340,318 | $ | 312,036 | |||||||
Net
realized investment gains (losses) on fixed maturities and short-term investments | $ | 70,165 | $ | (20,723 | ) | $ | 221,659 | $ | (49,169 | ) | |||||
Net
realized investment (losses) gains on equities | (174 | ) | 1,145 | 6,241 | 15,303 | ||||||||||
Net realized investment gains on other invested assets | 9,385 | 16,254 | 9,472 | 7,202 | |||||||||||
Net
realized investment (losses) on funds held–directly managed | — | (192 | ) | — | (470 | ) | |||||||||
Net realized investment gains (losses) | $ | 79,376 | $ | (3,516 | ) | $ | 237,372 | $ | (27,134 | ) | |||||
Change
in net unrealized investment (losses) gains on fixed maturities and short-term investments | $ | (29,346 | ) | $ | (52,586 | ) | $ | 262,620 | $ | (357,791 | ) | ||||
Change
in net unrealized investment gains on equities | 67,836 | 27,929 | 244,103 | 43,518 | |||||||||||
Change in net unrealized investment (losses) gains on other
invested assets | (4,272 | ) | (10,991 | ) | 20,192 | 9,737 | |||||||||
Change in net unrealized investment (losses) on funds held–directly managed | — | (1,473 | ) | — | (4,792 | ) | |||||||||
Net
other realized and unrealized investment (losses) gains | — | (686 | ) | 235 | (1,030 | ) | |||||||||
Change in net unrealized investment gains (losses) | $ | 34,218 | $ | (37,807 | ) | $ | 527,150 | $ | (310,358 | ) | |||||
Net
realized and unrealized investment gains (losses) | $ | 113,594 | $ | (41,323 | ) | $ | 764,522 | $ | (337,492 | ) |
As at and for the three
months ended | As at and for the nine months ended | ||||||||||||||
Reconciliation of beginning and ending non-life reserves: | |||||||||||||||
Gross liability at beginning of period | $ | 9,867,699 | $ | 9,709,286 | $ | 9,895,376 | $ | 10,102,172 | |||||||
Reinsurance
recoverable at beginning of period | (749,325 | ) | (591,144 | ) | (850,946 | ) | (719,998 | ) | |||||||
Net liability at beginning of period | 9,118,374 | 9,118,142 | 9,044,430 | 9,382,174 | |||||||||||
Net
incurred losses related to: | |||||||||||||||
Current year | 921,134 | 926,073 | 2,497,018 | 2,367,368 | |||||||||||
Prior
years | 3,240 | (32,471 | ) | 17,757 | (102,201 | ) | |||||||||
924,374 | 893,602 | 2,514,775 | 2,265,167 | ||||||||||||
Change
in reserve agreement (1) | — | — | — | 6,572 | |||||||||||
Net losses paid | (698,105 | ) | (639,279 | ) | (2,213,327 | ) | (2,146,987 | ) | |||||||
Effects
of foreign exchange rate changes | (115,741 | ) | 23,359 | (116,976 | ) | (111,102 | ) | ||||||||
Net liability at end of period | 9,228,902 | 9,395,824 | 9,228,902 | 9,395,824 | |||||||||||
Reinsurance
recoverable at end of period | 681,458 | 669,617 | 681,458 | 669,617 | |||||||||||
Gross liability at end of period | $ | 9,910,360 | $ | 10,065,441 | $ | 9,910,360 | $ | 10,065,441 | |||||||
Breakdown
of gross liability at end of period: | |||||||||||||||
Case reserves | $ | 4,093,384 | $ | 4,134,614 | $ | 4,093,384 | $ | 4,134,614 | |||||||
Additional
case reserves | 153,432 | 172,644 | 153,432 | 172,644 | |||||||||||
Incurred but not reported reserves | 5,663,544 | 5,758,183 | 5,663,544 | 5,758,183 | |||||||||||
Gross
liability at end of period | $ | 9,910,360 | $ | 10,065,441 | $ | 9,910,360 | $ | 10,065,441 | |||||||
Gross
liability at end of period by Non-life segment: | |||||||||||||||
P&C | 6,871,475 | 7,187,378 | 6,871,475 | 7,187,378 | |||||||||||
Specialty | 3,038,885 | 2,878,063 | 3,038,885 | 2,878,063 | |||||||||||
Gross
liability at end of period | $ | 9,910,360 | $ | 10,065,441 | $ | 9,910,360 | $ | 10,065,441 | |||||||
Unrecognized
time value of non-life reserves (2) | $ | 361,061 | $ | 750,396 | $ | 361,061 | $ | 750,396 |
As at and for the three months ended | As at and for the nine months ended | ||||||||||||||
Reconciliation of beginning and ending life and health reserves: | |||||||||||||||
Gross
liability at beginning of period | $ | 2,312,182 | $ | 2,114,429 | $ | 2,198,080 | $ | 2,098,759 | |||||||
Reinsurance
recoverable at beginning of period | (11,705 | ) | (15,315 | ) | (11,829 | ) | (9,287 | ) | |||||||
Net liability at beginning of period | 2,300,477 | 2,099,114 | 2,186,251 | 2,089,472 | |||||||||||
Net
incurred losses | 300,488 | 262,540 | 914,574 | 759,464 | |||||||||||
Net losses paid | (370,354 | ) | (176,288 | ) | (878,571 | ) | (598,733 | ) | |||||||
Effects
of foreign exchange rate changes | (57,920 | ) | 12,351 | (49,563 | ) | (52,486 | ) | ||||||||
Net liability at end of period | 2,172,691 | 2,197,717 | 2,172,691 | 2,197,717 | |||||||||||
Reinsurance
recoverable at end of period | 9,943 | 9,875 | 9,943 | 9,875 | |||||||||||
Gross liability at end of period | $ | 2,182,634 | $ | 2,207,592 | $ | 2,182,634 | $ | 2,207,592 | |||||||
Life
value in force(1) | $ | 287,700 | $ | 352,500 | $ | 287,700 | $ | 352,500 |
Zone | Peril | 1-in-250 year PML | 1-in-500 year PML (Earthquake perils only) | |||||||
U.S. Northeast | Hurricane | $ | 847 | |||||||
U.S.
Gulf Coast | Hurricane | 802 | ||||||||
U.S. Southeast | Hurricane | 790 | ||||||||
Caribbean | Hurricane | 254 | ||||||||
Europe | Windstorm | 410 | ||||||||
Japan | Typhoon | 301 | ||||||||
California | Earthquake | 755 | $ | 1,107 | ||||||
Japan | Earthquake | 447 | 523 | |||||||
Australia | Earthquake | 289 | 366 | |||||||
New
Zealand | Earthquake | 256 | 362 | |||||||
British Columbia | Earthquake | 164 | 328 |
For
the three months ended | For the nine months ended | ||||||||||||||||||||||
$ | ROE(1) | $ | ROE(1) | $ | ROE(1) | $ | ROE(1) | ||||||||||||||||
Net
income (loss) available to common shareholder | 216,144 | 13.1 | % | (105,735 | ) | (7.2 | )% | 998,117 | 21.4 | % | (100,771 | ) | (2.3 | )% | |||||||||
(1)
ROE is calculated as net income or loss attributable to common shareholder divided by average common shareholder's equity, annualized for the period. The following is the average common shareholder's equity calculated using the sum of the beginning of period and end of period common shareholder's equity divided by two. | |||||||||||||||||||||||
For the three months ended | For the nine months ended | ||||||||||||||||||||||
Calculation
of average common shareholder's equity | |||||||||||||||||||||||
Beginning of period common shareholder's equity | $ | 6,550,204 | $ | 5,955,882 | $ | 5,812,287 | $ | 6,040,885 | |||||||||||||||
End
of period common shareholder's equity | $ | 6,638,780 | $ | 5,859,026 | $ | 6,638,780 | $ | 5,859,026 | |||||||||||||||
Average
common shareholder's equity | $ | 6,594,492 | $ | 5,907,454 | $ | 6,225,534 | $ | 5,949,956 |
Tangible book value: | |||||||
Total shareholders' equity | $ | 7,343,007 | $ | 6,516,514 | |||
Less: | |||||||
Preferred
shares, aggregate liquidation value at $25 per share | 704,227 | 704,227 | |||||
Common shareholder’s equity or book value | 6,638,780 | 5,812,287 | |||||
Less: | |||||||
Goodwill | 456,380 | 456,380 | |||||
Intangible
assets, net of tax (1) | 111,395 | 118,808 | |||||
Tangible book value | $ | 6,071,005 | $ | 5,237,099 | |||
Capital
structure: | |||||||
Senior notes (2) | $ | 1,308,102 | $ | 1,349,017 | |||
Capital efficient notes (3) | 62,484 | 63,384 | |||||
Preferred
shares, aggregate liquidation value | 704,227 | 704,227 | |||||
Common shareholder's equity | 6,638,780 | 5,812,287 | |||||
Total capital | $ | 8,713,593 | $ | 7,928,915 |
This ‘6-K’ Filing | Date | Other Filings | ||
---|---|---|---|---|
Filed on / For Period end: | 11/8/19 | |||
9/30/19 | ||||
6/30/19 | ||||
1/1/19 | ||||
12/31/18 | 20-F | |||
9/30/18 | ||||
List all Filings |