For the Three and Nine Months Ended September 30, ~~2017~~2021, and ~~2016~~2020

1.GENERAL

~~As used in this document, "Holdings" means~~

Everest Reinsurance Holdings, Inc. (“Holdings”), a Delaware company and direct subsidiary of Everest Underwriting Group (Ireland) Limited ("(“Holdings ~~Ireland"~~Ireland”); ~~"Group"~~“Group” means Everest Re Group, Ltd. (Holdings ~~Ireland's~~Ireland’s parent); ~~"Bermuda Re"~~“Bermuda Re” means Everest Reinsurance (Bermuda), Ltd., a subsidiary of Group; ~~"Everest Re"~~“Everest Re” means Everest Reinsurance Company and its subsidiaries, a subsidiary of Holdings (unless the context otherwise requires) and the ~~"Company"~~“Company” means Holdings and its subsidiaries.

During the third quarter of 2016, the Company established domestic subsidiaries, Everest Premier Insurance Company ("Everest Premier") and Everest Denali Insurance Company ("Everest Denali"), which will be used in the continued expansion of the Insurance operations.

Effective August 24, 2016, the Company sold its wholly-owned subsidiary, Heartland Crop Insurance Company ("Heartland"), a managing agent for crop insurance, to CGB Diversified Services, Inc. ("CGB"). The operating results of Heartland for the period owned are included within the Company's financial statements.

2.BASIS OF PRESENTATION

The unaudited interim consolidated financial statements of the Company as of September 30, 2021 and December 31, 2020 and for the three and nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 include all adjustments, consisting of normal recurring accruals, which, in the opinion of management, are necessary for a fair statement of the results on an interim basis. Certain financial information, which is normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America ~~("GAAP"~~(“GAAP”), has been omitted since it is not required for interim reporting purposes. The December 31, ~~2016~~2020 consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. The results for the three and nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 are not necessarily indicative of the results for a full year. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the years ended December 31, ~~2016, 2015~~2020, 2019 and ~~2014~~2018 included in the ~~Company's~~Company’s most recent Form 10-K filing.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities (and disclosure of contingent assets and liabilities) at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Ultimate actual results could differ, possibly materially, from those estimates. This is particularly true given the fluid and continuing nature of the COVID-19 pandemic. This is an ongoing event and so is the Company’s evaluation and analysis. While the Company’s analysis considers all aspects of its operations, it does not take into account legal, regulatory or legislative intervention that could retroactively mandate or expand coverage provisions. Given the uncertainties in the current public health and economic environment, there could be an adverse impact on results for the Property & Casualty industry and the Company for the remainder of the year. The impact is dependent on the shape and length of the economic recovery.

All intercompany accounts and transactions have been eliminated.

~~Certain reclassifications and format changes have been made to prior years' amounts to conform to the 2017 presentation.~~

Application of Recently Issued Accounting Standard Changes.

~~Amortization of Bond Premium.~~

Reference Rate Reform - LIBOR.In March ~~2017, FASB~~2020, the Financial Accounting Standards Board (“FASB”) issued ASU ~~2017-08~~2020-04 (and subsequently issued ASU 2021-01 in January 2021), which outlines the issues surrounding the cessation of LIBOR as a reference rate for contractual debt agreements. The guidance onalso details the ~~amortization period~~potential alternative expedients and sources available for ~~premium on callable~~use in determination of rates and terms for such debt ~~securities. The new guidance requires that the premium on callable debt securities be amortized through the earliest call date rather than through the maturity date of the callable security.~~agreements in order to apply appropriate accounting policy. The guidance is effective for annual ~~and interim~~ reporting periods beginning after December 15, ~~2019. The Company does not expect the adoption of ASU 2017-08 to have a material impact on its financial statements.~~

~~Presentation and Disclosure of Net Periodic Benefit Costs.~~ In March 2017, FASB issued ASU 2017-07 which outlines guidance on the presentation of net periodic costs of benefit plans. The new guidance requires that the service cost component of net periodic benefit costs be reported within the same line item of the statements of operations as other compensation costs are reported. Other components of net periodic benefit costs should be reported separately. Footnote disclosure is required to state within which line items of the statements of operations the components are reported. The guidance is effective for annual and interim reporting periods beginning after December 15, 2017. The Company does not expect the adoption of ASU 2017-07 to have a material impact on its financial statements.

~~Disclosure of Restricted Cash.~~ In November 2016, FASB issued ASU 2016-18 which outlines guidance on the presentation in the statements of cash flows of changes in restricted cash. The new guidance requires that the statements of cash flows should reflect all changes in cash, cash equivalents and restricted cash in total and not segregated individually. The guidance is effective for annual and interim reporting periods beginning after December 15, 2017. The Company does not expect the adoption of ASU 2016-18 to have a material impact on its financial statements.

~~Intra-Entity Asset Transfers.~~ In October 2016, FASB issued ASU 2016-16 which outlines guidance on the tax accounting for intra-entity asset sales and transfers, other than inventory. The new guidance requires that reporting entities recognize tax expense from the intra-entity transfer of an asset in the seller's tax jurisdiction at the time of transfer and recognize any deferred tax asset in the buyer's tax jurisdiction at the time of transfer. The guidance is effective for annual and interim reporting periods beginning after December 15, 2017. The Company does not expect the adoption of ASU 2016-16 to have a material impact on its financial statements.

~~Valuation of Financial Instruments.~~ In June 2016, FASB issued ASU 2016-13 which outlines guidance on the valuation of and accounting for assets measured at amortized cost and available for sale debt securities. The carrying value of assets measured at amortized cost will now be presented as the amount expected to be collected on the financial asset (amortized cost less an allowance for credit losses valuation account). Available for sale debt securities will now record credit losses through an allowance for credit losses, which will be limited to the amount by which fair value is below amortized cost. The guidance is effective for annual and interim reporting periods beginning after December 15, 2019.2021. The Company is currently evaluating the impact of the adoption of ASU ~~2016-13~~2020-04 and 2021-01 on its financial statements.

~~Leases.~~

Accounting for Income Taxes. In ~~February 2016,~~December 2019, FASB issued ASU ~~2016-02~~2019-12, which ~~outlines new~~provides simplification of existing guidance onfor income taxes, including the ~~accounting for leases. The new guidance requires the~~removal of certain exceptions related to recognition of ~~lease assets and lease~~deferred tax liabilities on ~~the balance sheets for most leases that were previously deemed operating leases and required only lease expense presentation in the statements of operations.~~foreign subsidiaries. The guidance is effective for annual and interim reporting periods beginning after December 15, 2018. The Company is currently evaluating the impact of the adoption of ASU 2016-02 on its financial statements.

~~Recognition and Measurement of Financial Instruments.~~ In January 2016, the FASB issued ASU 2016-01 which outlines revised guidance on the accounting for equity investments. The new guidance states that all equity investments in unconsolidated entities will be measures at fair value, with the change in value being recorded through the income statement rather than being recorded within other comprehensive income. The updated guidance is effective for annual and interim reporting periods beginning after December 15, 2017. The Company is currently evaluating the impact of the adoption of ASU 2016-01 on its financial statements.

~~Disclosures about Short-Duration Contracts.~~ In May 2015, the FASB issued ASU 2015-09, authoritative guidance regarding required disclosures associated with short duration insurance contracts. The new disclosure requirements focus on information about initial claim estimates and subsequent claim estimate adjustment, methodologies in estimating claims and the timing, frequency and severity of claims related to short duration insurance contracts. This guidance is effective for annual reporting periods beginning after December 15, ~~2015~~2020 and interim periods within that annual reporting ~~periods beginning after December 15, 2016.~~period. The Company ~~implemented this~~adopted the guidance

effective ~~in the fourth quarter of 2016.~~

~~Disclosures for Investments in Certain Entities that Calculate Net Asset Value Per Share.~~ In May 2015, the FASB issued ASU 2015-07, which removes the requirement to categorize, within the fair value hierarchy, investments for which fair values are estimated using the net asset value practical expedient provided by Accounting Standards Codification 820, Fair Value Measurement. The updated guidance is effective for annual reporting periods beginning after December 15, 2015.January 1, 2021. The adoption of ASU 2019-12 did not have a material impact on the ~~Company's~~Company’s financial statements.

~~Debt Issuance Costs.~~ In April 2015, The FASB issued ASU 2015–03, authoritative guidance on the presentation of debt issuance costs. This guidance requires that debt issuance costs be presented within the balance sheet as a reduction of the carrying value of the debt liability, rather than as a separate asset. This guidance is effective for annual reporting periods beginning after December 15, 2015 and related

~~interim reporting periods. The Company implemented this guidance effective in the second quarter of 2016. The adoption did not have a material impact on the Company's financial statements.~~

~~Consolidation.~~ In February 2015, the FASB issued ASU 2015-02, authoritative guidance regarding consolidation of reporting entities. The new guidance focuses on the required evaluation of whether certain legal entities should be consolidated. This guidance is effective for annual and interim reporting periods beginning after December 15, 2015. Based upon this guidance, the Company has determined that the separate segregated accounts associated with Mt. Logan Re should not be consolidated. The Company implemented the guidance effective January 1, 2016.

~~Revenue Recognition.~~ In May 2014, the FASB issued ASU 2014-09 which outlines revised guidance on the recognition of revenue arising from contracts with customers. The new guidance states that reporting entities should apply certain steps to determine when revenue should be recognized, based upon fulfillment of performance obligations to complete contracts. The updated guidance is effective for annual and interim reporting periods beginning after December 15, 2017. The Company does not expect the adoption of ASU 2014-09 to have a material impact on its financial statements.

Any issued guidance and pronouncements, other than those directly ~~references~~referenced above, are deemed by the Company to be either not applicable or immaterial to its financial statements.

3. ~~REVISIONS TO FINANCIAL STATEMENTS~~

In preparing its second quarter of 2017 financial statements, the Company altered its processing of ceding certain commissions and deferred acquisition costs under an affiliated quota share agreement. In previous reporting periods, these expenses were ceded based upon a quarter lag. In the second quarter of 2017, the quarter lag was eliminated and these expenses are now recorded on a current quarter basis. Although management determined that the impact of the ceding lag was not material to prior period financial statements, the impact of eliminating the ceding lag would have significantly impacted results within the second quarter of 2017. As a result, prior period balances have been revised in the applicable financial statements and corresponding footnotes to eliminate the impact of the previous recording lag.

Management assessed the materiality of this change within prior period financial statements based upon SEC Staff Accounting Bulletin Number 99, Materiality, which is since codified in Accounting Standards Codification ("ASC") 250, Accounting Changes and Error Corrections. In accordance with ASC 250, the prior period comparative financial statements that are presented herein have been revised.

INVESTMENTS

The following tables present line items for prior period financial statements that have been affected by the revision. For these line items, the tables detail the amounts as previously reported, the impact upon those line items due to the revision, and the amounts as currently revised within the financial statements.

CONSOLIDATED BALANCE SHEETS March 31, 2017
As Previously Impact of
Reported Revisions As Revised
(Dollars in thousands, except par value per share)
ASSETS:
Deferred acquisition costs $ 62,308 $ (4,994 ) $ 57,314
TOTAL ASSETS $ 17,587,840 $ (4,994 ) $ 17,582,846

LIABILITIES:
Other net payable to reinsurers $ 832,307 $ (41,746 ) $ 790,561
Income taxes 223,629 5,625 229,254
Total liabilities 12,139,623 (36,121 ) 12,103,502

STOCKHOLDERS EQUITY:
Retained earnings 5,085,352 31,127 5,116,479
Total stockholder's equity 5,448,217 31,127 5,479,344
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 17,587,840 $ (4,994 ) $ 17,582,846

CONSOLIDATED BALANCE SHEETS December 31, 2016 December 31, 2015
As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised
(Dollars in thousands, except par value per share)
ASSETS:
Deferred acquisition costs $ 73,924 $ (5,303 ) $ 68,621 $ 92,651 $ (6,249 ) $ 86,402
TOTAL ASSETS $ 17,088,739 $ (5,303 ) $ 17,083,436 $ 16,695,203 $ (6,249 ) $ 16,688,954

LIABILITIES:
Other net payable to reinsurers $ 860,391 $ (45,093 ) $ 815,298 $ 1,225,260 $ (37,480 ) $ 1,187,780
Income taxes 142,143 6,797 148,940 68,024 4,132 72,156
Total liabilities 11,823,179 (38,296 ) 11,784,883 11,763,992 (33,348 ) 11,730,644

STOCKHOLDERS EQUITY:
Retained earnings 4,914,308 32,993 4,947,301 4,618,558 27,099 4,645,657
Total stockholder's equity 5,265,560 32,993 5,298,553 4,931,211 27,099 4,958,310
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 17,088,739 $ (5,303 ) $ 17,083,436 $ 16,695,203 $ (6,249 ) $ 16,688,954

CONSOLIDATED STATEMENTS OF OPERATIONS Year Ended December 31, 2016 Year Ended December 31, 2015
AND COMPREHENSIVE INCOME (LOSS): As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised
(Dollars in thousands)
CLAIMS AND EXPENSES:
Commission, brokerage, taxes and fees $ 289,982 $ (8,558 ) $ 281,424 $ 315,069 $ (2,744 ) $ 312,325
Total claims and expenses 1,928,940 (8,558 ) 1,920,382 1,892,062 (2,744 ) 1,889,318

INCOME (LOSS) BEFORE TAXES 390,433 8,558 398,991 604,542 2,744 607,286
Income tax expense (benefit) 94,683 2,664 97,347 191,889 3,007 194,896

NET INCOME (LOSS) $ 295,750 $ 5,894 $ 301,644 $ 412,653 $ (263 ) $ 412,390

COMPREHENSIVE INCOME (LOSS) $ 321,571 $ 5,894 $ 327,465 $ 345,998 $ (263 ) $ 345,735

CONSOLIDATED STATEMENTS OF OPERATIONS Year Ended December 31, 2014 Three Months Ended March 31, 2017
AND COMPREHENSIVE INCOME (LOSS): As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised
(Dollars in thousands)
CLAIMS AND EXPENSES:
Commission, brokerage, taxes and fees $ 339,402 $ (427 ) $ 338,975 $ 49,470 $ 3,037 $ 52,507
Total claims and expenses 1,930,749 (427 ) 1,930,322 411,543 3,037 414,580

INCOME (LOSS) BEFORE TAXES 657,688 427 658,115 247,984 (3,037 ) 244,947
Income tax expense (benefit) 203,562 1,125 204,687 76,940 (1,171 ) 75,769

NET INCOME (LOSS) $ 454,126 $ (698 ) $ 453,428 $ 171,044 $ (1,866 ) $ 169,178

COMPREHENSIVE INCOME (LOSS) $ 370,997 $ (698 ) $ 370,299 $ 182,587 $ (1,866 ) $ 180,721

CONSOLIDATED STATEMENTS OF OPERATIONS Three Months Ended September 30, 2016 Nine Months Ended September 30, 2016
AND COMPREHENSIVE INCOME (LOSS): As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised
(Dollars in thousands)
CLAIMS AND EXPENSES:
Commission, brokerage, taxes and fees $ 85,563 $ (2,785 ) $ 82,778 $ 226,511 $ (6,959 ) $ 219,552
Total claims and expenses 462,009 (2,785 ) 459,224 1,377,175 (6,959 ) 1,370,216

INCOME (LOSS) BEFORE TAXES 95,943 2,785 98,728 249,064 6,959 256,023
Income tax expense (benefit) 21,145 1,280 22,425 66,990 2,368 69,358

NET INCOME (LOSS) $ 74,798 $ 1,505 $ 76,303 $ 182,074 $ 4,591 $ 186,665

COMPREHENSIVE INCOME (LOSS) $ 74,465 $ 1,505 $ 75,970 $ 299,559 $ 4,591 $ 304,150

CONSOLIDATED STATEMENTS OF OPERATIONS Three Months Ended June 30, 2016 Six Months Ended June 30, 2016
AND COMPREHENSIVE INCOME (LOSS): As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised
(Dollars in thousands)
CLAIMS AND EXPENSES:
Commission, brokerage, taxes and fees $ 72,126 $ (1,717 ) $ 70,409 $ 140,948 $ (4,174 ) $ 136,774
Total claims and expenses 479,860 (1,717 ) 478,143 915,166 (4,174 ) 910,992

INCOME (LOSS) BEFORE TAXES 101,332 1,717 103,049 153,121 4,174 157,295
Income tax expense (benefit) 32,982 695 33,677 45,845 1,088 46,933

NET INCOME (LOSS) $ 68,350 $ 1,022 $ 69,372 $ 107,276 $ 3,086 $ 110,362

COMPREHENSIVE INCOME (LOSS) $ 124,381 $ 1,022 $ 125,403 $ 225,094 $ 3,086 $ 228,180

CONSOLIDATED STATEMENTS OF OPERATIONS Three Months Ended March 31, 2016
AND COMPREHENSIVE INCOME (LOSS): As Previously Impact of
Reported Revisions As Revised
(Dollars in thousands)
CLAIMS AND EXPENSES:
Commission, brokerage, taxes and fees $ 68,822 $ (2,457 ) $ 66,365
Total claims and expenses 435,306 (2,457 ) 432,849

INCOME (LOSS) BEFORE TAXES 51,789 2,457 54,246
Income tax expense (benefit) 12,863 393 13,256

NET INCOME (LOSS) $ 38,926 $ 2,064 $ 40,990

COMPREHENSIVE INCOME (LOSS) $ 100,713 $ 2,064 $ 102,777

CONSOLIDATED STATEMENTS OF Year Ended December 31, 2016 Year Ended December 31, 2015
CHANGES IN STOCKHOLDER'S EQUITY As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised

(Dollars in thousands, except share amounts)
RETAINED EARNINGS:
Balance, beginning of period $ 4,618,558 $ 27,099 $ 4,645,657 $ 4,205,905 $ 27,362 $ 4,233,267
Net income (loss) 295,750 5,894 301,644 412,653 (263 ) 412,390
Balance, end of period 4,914,308 32,993 4,947,301 4,618,558 27,099 4,645,657
TOTAL STOCKHOLDER'S EQUITY, END OF PERIOD $ 5,265,560 $ 32,993 $ 5,298,553 $ 4,931,211 $ 27,099 $ 4,958,310

CONSOLIDATED STATEMENTS OF Year Ended December 31, 2014 Three Months Ended March 31, 2017
CHANGES IN STOCKHOLDER'S EQUITY As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised

(Dollars in thousands, except share amounts)
RETAINED EARNINGS:
Balance, beginning of period $ 3,751,779 $ 28,060 $ 3,779,839 $ 4,914,308 $ 32,993 $ 4,947,301
Net income (loss) 454,126 (698 ) 453,428 171,044 (1,866 ) 169,178
Balance, end of period 4,205,905 27,362 4,233,267 5,085,352 31,127 5,116,479
TOTAL STOCKHOLDER'S EQUITY, END OF PERIOD $ 4,572,717 $ 27,362 $ 4,600,079 $ 5,448,217 $ 31,127 $ 5,479,344

CONSOLIDATED STATEMENTS OF Three Months Ended September 30, 2016 Nine Months Ended September 30, 2016
CHANGES IN STOCKHOLDER'S EQUITY As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised

(Dollars in thousands, except share amounts)
RETAINED EARNINGS:
Balance, beginning of period $ 4,725,834 $ 30,185 $ 4,756,019 $ 4,618,558 $ 27,099 $ 4,645,657
Net income (loss) 74,798 1,505 76,303 182,074 4,591 186,665
Balance, end of period 4,800,632 31,690 4,832,322 4,800,632 31,690 4,832,322
TOTAL STOCKHOLDER'S EQUITY, END OF PERIOD $ 5,240,955 $ 31,690 $ 5,272,645 $ 5,240,955 $ 31,690 $ 5,272,645

CONSOLIDATED STATEMENTS OF Three Months Ended June 30, 2016 Six Months Ended June 30, 2016
CHANGES IN STOCKHOLDER'S EQUITY As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised

(Dollars in thousands, except share amounts)
RETAINED EARNINGS:
Balance, beginning of period $ 4,657,484 $ 29,163 $ 4,686,647 $ 4,618,558 $ 27,099 $ 4,645,657
Net income (loss) 68,350 1,022 69,372 107,276 3,086 110,362
Balance, end of period 4,725,834 30,185 4,756,019 4,725,834 30,185 4,756,019
TOTAL STOCKHOLDER'S EQUITY, END OF PERIOD $ 5,164,053 $ 30,185 $ 5,194,238 $ 5,164,053 $ 30,185 $ 5,194,238

CONSOLIDATED STATEMENTS OF Three Months Ended March 31, 2016
CHANGES IN STOCKHOLDER'S EQUITY As Previously Impact of
Reported Revisions As Revised

(Dollars in thousands, except share amounts)
RETAINED EARNINGS:
Balance, beginning of period $ 4,618,558 $ 27,099 $ 4,645,657
Net income (loss) 38,926 2,064 40,990
Balance, end of period 4,657,484 29,163 4,686,647
TOTAL STOCKHOLDER'S EQUITY, END OF PERIOD $ 5,036,717 $ 29,163 $ 5,065,880

CONSOLIDATED STATEMENTS OF CASH FLOWS Year Ended December 31, 2016 Year Ended December 31, 2015
As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised
(Dollars in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 295,750 $ 5,894 $ 301,644 $ 412,653 $ (263 ) $ 412,390
Decrease (increase) in income taxes 60,325 2,666 62,991 57,487 3,007 60,494
Increase (decrease) in other net payable to reinsurers (364,242 ) (7,614 ) (371,856 ) 204,526 (8,590 ) 195,936
Change in other assets and liabilities, net 16,090 (946 ) 15,144 7,499 5,846 13,345

CONSOLIDATED STATEMENTS OF CASH FLOWS Year Ended December 31, 2014 Three Months Ended March 31, 2017
As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised
(Dollars in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 454,126 $ (698 ) $ 453,428 $ 171,044 $ (1,866 ) $ 169,178
Decrease (increase) in income taxes 68,206 1,125 69,331 75,304 (1,172 ) 74,132
Increase (decrease) in other net payable to reinsurers 5,130 (3,216 ) 1,914 (30,525 ) 3,347 (27,178 )
Change in other assets and liabilities, net 81,388 2,789 84,177 18,204 (309 ) 17,895

CONSOLIDATED STATEMENTS OF CASH FLOWS Nine Months Ended September 30, 2016 Six Months Ended June 30, 2016
As Previously Impact of As Previously Impact of
Reported Revisions As Revised Reported Revisions As Revised
(Dollars in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 182,074 $ 4,591 $ 186,665 $ 107,276 $ 3,086 $ 110,362
Decrease (increase) in income taxes 33,279 2,368 35,647 8,190 1,089 9,279
Increase (decrease) in other net payable to reinsurers (209,260 ) (6,764 ) (216,024 ) (370,242 ) (3,111 ) (373,353 )
Change in other assets and liabilities, net (124,955 ) (195 ) (125,150 ) 14,216 (1,064 ) 13,152

CONSOLIDATED STATEMENTS OF CASH FLOWS Three Months Ended March 31, 2016
As Previously Impact of
Reported Revisions As Revised
(Dollars in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 38,926 $ 2,064 $ 40,990
Decrease (increase) in income taxes 6,546 393 6,939
Increase (decrease) in other net payable to reinsurers (106,588 ) (1,122 ) (107,710 )
Change in other assets and liabilities, net 24,496 (1,335 ) 23,161

~~4. INVESTMENTS~~

~~The~~show amortized cost, ~~market value and~~allowance for credit losses, gross unrealized appreciation, gross unrealized depreciation and ~~depreciation~~market value of available for sale, fixed maturity ~~equity security investments, carried at market value and other-than-temporary impairments ("OTTI") in accumulated other comprehensive income ("AOCI") are~~securities as ~~follows for~~of the ~~periods~~dates indicated:

	At September 30, 2021
	Amortized		Allowances for		Unrealized		Unrealized		Market
(Dollars in thousands)	Cost		Credit Losses		Appreciation		Depreciation		Value
Fixed maturity securities
U.S. Treasury securities and obligations of U.S. government agencies and corporations	$	612,456	$	-	$	12,505	$	(911)	$	624,050
Obligations of U.S. states and political subdivisions		577,289		(151)		31,294		(1,057)		607,375
Corporate securities		3,675,504		(22,889)		119,670		(21,015)		3,751,270
Asset-backed securities		3,162,626		(7,680)		30,688		(2,987)		3,182,647
Mortgage-backed securities
Commercial		575,056		-		26,423		(3,096)		598,383
Agency residential		997,672		-		20,963		(3,523)		1,015,112
Non-agency residential		4,972		-		8		(4)		4,976
Foreign government securities		689,353		-		28,743		(4,747)		713,349
Foreign corporate securities		1,363,669		(393)		46,475		(9,433)		1,400,318
Total fixed maturity securities	$	11,658,597	$	(31,113)	$	316,769	$	(46,773)	$	11,897,480

	At December 31, 2020
	Amortized		Allowances for		Unrealized		Unrealized		Market
(Dollars in thousands)	Cost		Credit Losses		Appreciation		Depreciation		Value
Fixed maturity securities
U.S. Treasury securities and obligations of U.S. government agencies and corporations	$	659,957	$	-	$	22,032	$	-	$	681,989
Obligations of U.S. states and political subdivisions		543,646		-		34,655		(1,255)		577,046
Corporate securities		3,316,525		(1,205)		166,072		(31,480)		3,449,912
Asset-backed securities		2,450,807		-		28,585		(5,222)		2,474,170
Mortgage-backed securities
Commercial		512,388		-		37,875		(183)		550,080
Agency residential		937,166		-		28,630		(696)		965,100
Non-agency residential		3,164		-		2		(2)		3,164
Foreign government securities		694,132		-		51,317		(3,211)		742,238
Foreign corporate securities		1,130,865		(361)		73,265		(3,903)		1,199,866
Total fixed maturity securities	$	10,248,650	$	(1,566)	$	442,433	$	(45,952)	$	10,643,565

At September 30, 2017
Amortized Unrealized Unrealized Market OTTI in AOCI
(Dollars in thousands) Cost Appreciation Depreciation Value (a)
Fixed maturity securities
U.S. Treasury securities and obligations of
U.S. government agencies and corporations $ 657,018 $ 2,088 $ (3,220 ) $ 655,886 $ -
Obligations of U.S. states and political subdivisions 652,525 24,061 (4,744 ) 671,842 -
Corporate securities 2,213,498 38,058 (11,965 ) 2,239,591 695
Asset-backed securities 153,400 451 (62 ) 153,789 -
Mortgage-backed securities
Commercial 59,311 334 (622 ) 59,023 -
Agency residential 683,178 1,904 (7,252 ) 677,830 -
Non-agency residential 55 7 - 62 -
Foreign government securities 520,431 19,038 (7,996 ) 531,473 -
Foreign corporate securities 1,034,840 25,601 (10,576 ) 1,049,865 374
Total fixed maturity securities $ 5,974,256 $ 111,542 $ (46,437 ) $ 6,039,361 $ 1,069

At December 31, 2016
Amortized Unrealized Unrealized Market OTTI in AOCI
(Dollars in thousands) Cost Appreciation Depreciation Value (a)
Fixed maturity securities
U.S. Treasury securities and obligations of
U.S. government agencies and corporations $ 693,005 $ 2,509 $ (4,434 ) $ 691,080 $ -
Obligations of U.S. states and political subdivisions 723,938 18,016 (11,970 ) 729,984 -
Corporate securities 2,119,324 50,665 (15,786 ) 2,154,203 4,868
Asset-backed securities 136,826 330 (129 ) 137,027 -
Mortgage-backed securities
Commercial 75,435 510 (452 ) 75,493 -
Agency residential 721,772 2,365 (8,993 ) 715,144 -
Non-agency residential 76 12 - 88 -
Foreign government securities 495,572 22,088 (10,383 ) 507,277 -
Foreign corporate securities 944,546 30,015 (14,361 ) 960,200 175
Total fixed maturity securities $ 5,910,494 $ 126,510 $ (66,508 ) $ 5,970,496 $ 5,043

^(a) Represents the amount of OTTI recognized in AOCI. Amount includes unrealized gains and losses on impaired securities relating to changes in the value of such securities subsequent to the impairment measurement date.

The amortized cost and market value of fixed maturity securities are shown in the following tables by contractual maturity. Mortgage-backed securities are generally more likely to be prepaid than other fixed maturity securities. As the stated maturity of such securities may not be indicative of actual maturities, the totals for mortgage-backed and asset-backed securities are shown separately.

	At September 30, 2021				At December 31, 2020
	Amortized		Market		Amortized		Market
(Dollars in thousands)	Cost		Value		Cost		Value
Fixed maturity securities – available for sale
Due in one year or less	$	638,736	$	638,370	$	658,561	$	659,622
Due after one year through five years		3,146,824		3,223,451		2,911,285		3,036,151
Due after five years through ten years		2,119,485		2,193,899		1,927,265		2,079,866
Due after ten years		1,013,226		1,040,642		848,014		875,412
Asset-backed securities		3,162,626		3,182,647		2,450,807		2,474,170
Mortgage-backed securities
Commercial		575,056		598,383		512,388		550,080
Agency residential		997,672		1,015,112		937,166		965,100
Non-agency residential		4,972		4,976		3,164		3,164
Total fixed maturity securities	$	11,658,597	$	11,897,480	$	10,248,650	$	10,643,565

At September 30, 2017 At December 31, 2016
Amortized Market Amortized Market
(Dollars in thousands) Cost Value Cost Value
Fixed maturity securities – available for sale
    Due in one year or less $ 403,948 $ 405,602 $ 394,401 $ 392,824
    Due after one year through five years 2,918,422 2,931,495 2,925,786 2,955,325
    Due after five years through ten years 1,024,154 1,045,455 879,762 894,166
    Due after ten years 731,788 766,105 776,436 800,429
Asset-backed securities 153,400 153,789 136,826 137,027
Mortgage-backed securities
Commercial 59,311 59,023 75,435 75,493
Agency residential 683,178 677,830 721,772 715,144
Non-agency residential 55 62 76 88
Total fixed maturity securities $ 5,974,256 $ 6,039,361 $ 5,910,494 $ 5,970,496

The changes in net unrealized appreciation (depreciation) for the ~~Company's~~Company’s investments are derived from the following sources for the periods as indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Increase (decrease) during the period between the market value and cost of investments carried at market value, and deferred taxes thereon:
Fixed maturity securities and short-term investments	$	(52,322)	$	45,476	$	(126,348)	$	168,996
Change in unrealized appreciation (depreciation), pre-tax		(52,322)		45,476		(126,348)		168,996
Deferred tax benefit (expense)		11,000		(9,509)		26,510		(35,574)
Change in unrealized appreciation (depreciation), net of deferred taxes, included in stockholder's equity	$	(41,322)	$	35,967	$	(99,838)	$	133,422

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Increase (decrease) during the period between the market value and cost
of investments carried at market value, and deferred taxes thereon:
Fixed maturity securities $ (3,197 ) $ 4,047 $ 9,077 $ 127,736
Fixed maturity securities, other-than-temporary impairment (158 ) (2,444 ) (3,974 ) 4,199
Other invested assets 1,595 - 2,860 -
Change in unrealized appreciation (depreciation), pre-tax (1,760 ) 1,603 7,963 131,935
Deferred tax benefit (expense) 561 (1,418 ) (4,178 ) (44,709 )
Deferred tax benefit (expense), other-than-temporary impairment 55 856 1,391 (1,469 )
Change in unrealized appreciation (depreciation),
net of deferred taxes, included in stockholder's equity $ (1,144 ) $ 1,041 $ 5,176 $ 85,757

The Company ~~frequently~~ reviews all of its fixed maturity, available for sale securities ~~for declines in market value and focuses its attention on securities~~ whose fair value has fallen below ~~80% of~~ their amortized cost at the time of review. The Company then assesses whether the decline in value is ~~temporary~~due to non-credit related or ~~other-than-temporary.~~credit related factors. In making its assessment, the Company evaluates the current market and interest rate environment as well as specific issuer information. Generally, a change in a ~~security's~~security’s value caused by a change in the market, interest rate or foreign exchange environment does not constitute ~~an other-than-temporary~~a credit impairment, but rather a ~~temporary~~non-credit related decline in market value. ~~Temporary~~Non-credit related declines in market value are recorded as unrealized losses in accumulated other comprehensive income (loss). If the Company intends to sell the security or is more likely than not to sell the security, the Company records the entire fair value adjustment in net realized capital gains (losses) in the Company’s consolidated statements of operations and comprehensive income (loss). If the Company determines that the decline is ~~other-than-temporary~~credit related and the Company does not have the intent to sell the security; and it is more likely than not that the Company will not have to sell the security before recovery of its cost basis, the ~~carrying value of~~Company establishes a credit allowance equal to the ~~investment is written down to fair value. The fair value adjustment that is~~estimated credit ~~or foreign exchange related~~loss and is recorded in net realized capital gains (losses) in the ~~Company's~~Company’s consolidated statements of operations and comprehensive income (loss). The amount of the allowance for a given security will generally be the difference between a discounted cash flow model and the Company’s carrying value. The fair value adjustment that is non-credit related is recorded as a component of other comprehensive income (loss), net of tax, and is included in accumulated other comprehensive income (loss) in the ~~Company's~~Company’s consolidated balance sheets. The ~~Company's~~Company will adjust the credit allowance account for future changes in credit loss estimates for a

security and record this adjustment through net realized capital gains (losses) in the Company’s consolidated statements of operations and comprehensive income (loss).

The Company does not create an allowance for uncollectible interest. If interest is not received when due, the interest receivable is immediately reversed and no additional interest is accrued. If future interest is received that has not been accrued, it is recorded as income at that time.

The Company’s assessments are based on the ~~issuers~~issuers’ current and expected future financial position, timeliness with respect to interest and/or principal payments, speed of repayments and any applicable credit enhancements or breakeven constant default rates on mortgage-backed and asset-backed securities, as well as relevant information provided by rating agencies, investment advisors and analysts.

Retrospective adjustments are employed to recalculate the values of asset-backed securities. All of the ~~Company's~~Company’s asset-backed and mortgage-backed securities have a pass-through structure. Each acquisition lot is reviewed to recalculate the effective yield. The recalculated effective yield is used to derive a book value as if the new yield were applied at the time of acquisition. Outstanding principal factors from the time of acquisition to the adjustment date are used to calculate the prepayment history for all applicable securities. Conditional prepayment rates, computed with life to date factor histories and weighted average maturities, are used in the calculation of projected prepayments for pass-through security types.

The tables below display the aggregate market value and gross unrealized depreciation of fixed maturity ~~and equity~~ securities, by security type and contractual maturity, in each case subdivided according to length of time that individual securities had been in a continuous unrealized loss position for the periods ~~indicated:~~indicated:

	Duration of Unrealized Loss at September 30, 2021 By Security Type
	Less than 12 months				Greater than 12 months				Total
			Gross				Gross				Gross
	Market		Unrealized		Market		Unrealized		Market		Unrealized
(Dollars in thousands)	Value		Depreciation		Value		Depreciation		Value		Depreciation
Fixed maturity securities - available for sale
U.S. Treasury securities and obligations of U.S. government agencies and corporations	$	164,510	$	(911)	$	-	$	-	$	164,510	$	(911)
Obligations of U.S. states and political subdivisions		61,687		(937)		3,569		(120)		65,256		(1,057)
Corporate securities		926,023		(15,559)		171,444		(5,456)		1,097,467		(21,015)
Asset-backed securities		579,799		(2,619)		23,396		(368)		603,195		(2,987)
Mortgage-backed securities
Commercial		82,124		(1,908)		25,450		(1,188)		107,574		(3,096)
Agency residential		459,632		(2,872)		55,358		(651)		514,990		(3,523)
Non-agency residential		1,724		(2)		156		(2)		1,880		(4)
Foreign government securities		178,925		(2,881)		10,819		(1,866)		189,744		(4,747)
Foreign corporate securities		430,909		(8,034)		24,008		(1,399)		454,917		(9,433)
Total fixed maturity securities	$	2,885,334	$	(35,723)	$	314,199	$	(11,050)	$	3,199,533	$	(46,773)

Duration of Unrealized Loss at September 30, 2017 By Security Type
Less than 12 months Greater than 12 months Total
Gross Gross Gross
Unrealized Unrealized Unrealized
(Dollars in thousands) Market Value Depreciation Market Value Depreciation Market Value Depreciation
Fixed maturity securities - available for sale
U.S. Treasury securities and obligations of
U.S. government agencies and corporations $ 239,038 $ (2,191 ) $ 37,447 $ (1,029 ) $ 276,485 $ (3,220 )
Obligations of U.S. states and political subdivisions 89,509 (2,104 ) 67,956 (2,640 ) 157,465 (4,744 )
Corporate securities 415,341 (6,124 ) 155,808 (5,841 ) 571,149 (11,965 )
Asset-backed securities 30,657 (55 ) 1,912 (7 ) 32,569 (62 )
Mortgage-backed securities
Commercial 31,221 (487 ) 3,803 (135 ) 35,024 (622 )
Agency residential 417,521 (4,374 ) 115,934 (2,878 ) 533,455 (7,252 )
Non-agency residential - - - - - -
Foreign government securities 199,311 (4,486 ) 56,732 (3,510 ) 256,043 (7,996 )
Foreign corporate securities 254,015 (4,069 ) 89,121 (6,507 ) 343,136 (10,576 )
Total fixed maturity securities $ 1,676,613 $ (23,890 ) $ 528,713 $ (22,547 ) $ 2,205,326 $ (46,437 )

	Duration of Unrealized Loss at September 30, 2021 By Maturity
	Less than 12 months				Greater than 12 months				Total
			Gross				Gross				Gross
	Market		Unrealized		Market		Unrealized		Market		Unrealized
(Dollars in thousands)	Value		Depreciation		Value		Depreciation		Value		Depreciation
Fixed maturity securities
Due in one year or less	$	99,157	$	(1,838)	$	23,908	$	(2,582)	$	123,065	$	(4,420)
Due in one year through five years		756,922		(8,846)		124,406		(3,228)		881,328		(12,074)
Due in five years through ten years		614,332		(12,640)		34,678		(1,876)		649,010		(14,516)
Due after ten years		291,643		(4,998)		26,847		(1,155)		318,490		(6,153)
Asset-backed securities		579,799		(2,619)		23,396		(368)		603,195		(2,987)
Mortgage-backed securities		543,480		(4,782)		80,964		(1,841)		624,444		(6,623)
Total fixed maturity securities	$	2,885,334	$	(35,723)	$	314,199	$	(11,050)	$	3,199,533	$	(46,773)

Duration of Unrealized Loss at September 30, 2017 By Maturity
Less than 12 months Greater than 12 months Total
Gross Gross Gross
Unrealized Unrealized Unrealized
(Dollars in thousands) Market Value Depreciation Market Value Depreciation Market Value Depreciation
Fixed maturity securities
Due in one year or less $ 127,207 $ (514 ) $ 16,129 $ (1,148 ) $ 143,336 $ (1,662 )
Due in one year through five years 741,570 (10,638 ) 246,865 (12,047 ) 988,435 (22,685 )
Due in five years through ten years 220,432 (5,290 ) 76,295 (3,682 ) 296,727 (8,972 )
Due after ten years 108,005 (2,532 ) 67,775 (2,650 ) 175,780 (5,182 )
Asset-backed securities 30,657 (55 ) 1,912 (7 ) 32,569 (62 )
Mortgage-backed securities 448,742 (4,861 ) 119,737 (3,013 ) 568,479 (7,874 )
Total fixed maturity securities $ 1,676,613 $ (23,890 ) $ 528,713 $ (22,547 ) $ 2,205,326 $ (46,437 )

The aggregate market value and gross unrealized losses related to investments in an unrealized loss position at September 30, ~~2017~~2021 were ~~$2,205,326 thousand~~$3,199.5 million and ~~$46,437 thousand,~~$46.8 million, respectively. The market value of securities for the single issuer whose securities comprised the largest unrealized loss position at September 30, ~~2017, (the U.S. Government)~~2021, did not exceed ~~4.6%~~0.4% of the overall market value of the ~~Company's~~Company’s fixed maturity securities. In addition, as indicated on the above table, there was no significant concentration of unrealized losses in any one market sector. The ~~$23,890 thousand~~$35.7 million of unrealized losses related to fixed maturity securities that have been in an unrealized loss position for less than one year were generally comprised of domestic and foreign corporate securities, foreign government securities, asset backed securities and agency residential ~~mortgage-backed securities and foreign government~~mortgage backed securities. Of these unrealized losses, ~~$20,072 thousand~~$30.2 million were related to securities that were rated investment grade by at least one nationally recognized ~~statistical~~ rating agency. The ~~$22,547 thousand~~$11.1 million of unrealized losses related to fixed maturity securities in an unrealized loss position for more than one year related primarily to domestic and foreign corporate securities as well as foreign government securities. Of these unrealized losses ~~$20,240 thousand~~$8.7 million were related to securities that were rated investment grade by at least one nationally recognized ~~statistical~~ rating agency. There was no0 gross unrealized depreciation for mortgage-backed securities related to sub-prime and alt-A loans. In all instances, there were no projected cash flow shortfalls to recover the full book value of the investments and the related interest obligations. The mortgage-backed securities still have excess credit coverage and are current on interest and principal payments.

The Company, given the size of its investment portfolio and capital position, does not have the intent to sell these securities; and it is more likely than not that the Company will not have to sell the security before recovery of its cost basis. In addition, all securities currently in an unrealized loss position are current with respect to principal and interest payments.

	Duration of Unrealized Loss at December 31, 2020 By Security Type
	Less than 12 months				Greater than 12 months				Total
			Gross				Gross				Gross
	Market		Unrealized		Market		Unrealized		Market		Unrealized
(Dollars in thousands)	Value		Depreciation		Value		Depreciation		Value		Depreciation
Fixed maturity securities - available for sale
Obligations of U.S. states and political subdivisions		19,524		(999)		4,059		(256)		23,583		(1,255)
Corporate securities		240,601		(7,799)		188,853		(23,681)		429,454		(31,480)
Asset-backed securities		223,919		(4,573)		81,952		(649)		305,871		(5,222)
Mortgage-backed securities
Commercial		37,414		(182)		3,983		(1)		41,397		(183)
Agency residential		235,809		(682)		1,573		(14)		237,382		(696)
Non-agency residential		161		(2)		-		-		161		(2)
Foreign government securities		10,505		(373)		25,793		(2,838)		36,298		(3,211)
Foreign corporate securities		57,900		(2,182)		18,349		(1,721)		76,249		(3,903)
Total fixed maturity securities	$	825,833	$	(16,792)	$	324,562	$	(29,160)	$	1,150,395	$	(45,952)

	Duration of Unrealized Loss at December 31, 2020 By Maturity
	Less than 12 months				Greater than 12 months				Total
			Gross				Gross				Gross
	Market		Unrealized		Market		Unrealized		Market		Unrealized
(Dollars in thousands)	Value		Depreciation		Value		Depreciation		Value		Depreciation
Fixed maturity securities
Due in one year or less	$	28,802	$	(1,218)	$	34,555	$	(4,142)	$	63,357	$	(5,360)
Due in one year through five years		150,106		(5,828)		116,987		(4,783)		267,093		(10,611)
Due in five years through ten years		81,492		(1,634)		13,118		(435)		94,610		(2,069)
Due after ten years		68,130		(2,673)		72,394		(19,136)		140,524		(21,809)
Asset-backed securities		223,919		(4,573)		81,952		(649)		305,871		(5,222)
Mortgage-backed securities		273,384		(866)		5,556		(15)		278,940		(881)
Total fixed maturity securities	$	825,833	$	(16,792)	$	324,562	$	(29,160)	$	1,150,395	$	(45,952)

The tables below display the aggregate market value and gross unrealized depreciation of fixed maturity and equity securities, by security type and contractual maturity, in each case subdivided according to length of time that individual securities had been in a continuous unrealized loss position for the periods indicated:

Duration of Unrealized Loss at December 31, 2016 By Security Type
Less than 12 months Greater than 12 months Total
Gross Gross Gross
Unrealized Unrealized Unrealized
(Dollars in thousands) Market Value Depreciation Market Value Depreciation Market Value Depreciation
Fixed maturity securities - available for sale
U.S. Treasury securities and obligations of
U.S. government agencies and corporations $ 469,571 $ (4,434 ) $ - $ - $ 469,571 $ (4,434 )
Obligations of U.S. states and political subdivisions 221,088 (11,486 ) 564 (484 ) 221,652 (11,970 )
Corporate securities 431,757 (10,121 ) 118,172 (5,665 ) 549,929 (15,786 )
Asset-backed securities 35,065 (122 ) 5,745 (7 ) 40,810 (129 )
Mortgage-backed securities
Commercial 27,230 (391 ) 3,060 (61 ) 30,290 (452 )
Agency residential 487,000 (6,320 ) 90,740 (2,673 ) 577,740 (8,993 )
Non-agency residential - - - - - -
Foreign government securities 218,171 (2,713 ) 61,542 (7,670 ) 279,713 (10,383 )
Foreign corporate securities 264,939 (4,950 ) 75,489 (9,411 ) 340,428 (14,361 )
Total fixed maturity securities $ 2,154,821 $ (40,537 ) $ 355,312 $ (25,971 ) $ 2,510,133 $ (66,508 )

Duration of Unrealized Loss at December 31, 2016 By Maturity
Less than 12 months Greater than 12 months Total
Gross Gross Gross
Unrealized Unrealized Unrealized
(Dollars in thousands) Market Value Depreciation Market Value Depreciation Market Value Depreciation
Fixed maturity securities
Due in one year or less $ 111,926 $ (322 ) $ 21,691 $ (3,625 ) $ 133,617 $ (3,947 )
Due in one year through five years 1,015,066 (10,567 ) 190,960 (16,511 ) 1,206,026 (27,078 )
Due in five years through ten years 243,082 (10,369 ) 41,371 (2,961 ) 284,453 (13,330 )
Due after ten years 235,452 (12,446 ) 1,745 (133 ) 237,197 (12,579 )
Asset-backed securities 35,065 (122 ) 5,745 (7 ) 40,810 (129 )
Mortgage-backed securities 514,230 (6,711 ) 93,800 (2,734 ) 608,030 (9,445 )
Total fixed maturity securities $ 2,154,821 $ (40,537 ) $ 355,312 $ (25,971 ) $ 2,510,133 $ (66,508 )

The aggregate market value and gross unrealized losses related to investments in an unrealized loss position at December 31, ~~2016~~2020 were ~~$2,510,133 thousand~~$1,150.4 million and ~~$66,508 thousand,~~$46.0 million, respectively. The market value of securities for the single issuer whose securities comprised the largest unrealized loss position at December 31, ~~2016,~~2020, did not exceed ~~1.0%~~0.2% of the overall market value of the ~~Company's~~Company’s fixed maturity securities. In addition, as indicated on the above table, there was no significant concentration of unrealized losses in any one market sector. The ~~$40,537 thousand~~$16.8 million of unrealized losses related to fixed maturity securities that have been in an unrealized loss position for less than one year were generally comprised of ~~obligations of U.S. states and political subdivisions,~~ domestic and foreign corporate securities ~~agency residential mortgage-backed securities and foreign government~~as well as asset backed securities. Of these unrealized losses, ~~$36,646 thousand~~$12.5 million were related to securities that were rated investment grade by at least one nationally recognized ~~statistical~~ rating agency. The ~~$25,971 thousand~~$29.2 million of unrealized losses related to fixed maturity securities in an unrealized loss position for more than one year related primarily to domestic and foreign corporate securities and foreign government ~~securities and agency residential mortgage-backed~~ securities. Of these unrealized losses ~~$22,882 thousand is attributable~~$5.9 million were related to ~~net unrealized foreign exchange losses, as the U.S. dollar has strengthened against other currencies.~~securities that were rated investment grade by at least one nationally recognized rating agency. There was no0 gross unrealized depreciation for mortgage-backed securities related to sub-prime and alt-A loans. In all instances, there were no projected cash flow shortfalls to recover the full book value of the investments and the related interest obligations. The mortgage-backed securities still have excess credit coverage and are current on interest and principal payments.

The components of net investment income are presented in the tables below for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Fixed maturities	$	83,412	$	78,272	$	260,428	$	227,257
Equity securities		3,774		2,504		10,082		6,120
Short-term investments and cash		73		410		309		2,558
Other invested assets
Limited partnerships		81,928		35,908		260,486		2,439
Dividends from preferred shares of affiliate		7,758		7,758		23,274		23,274
Other		30,954		14,743		62,829		(1,291)
Gross investment income before adjustments		207,899		139,595		617,408		260,358
Funds held interest income (expense)		814		957		7,035		5,115
Interest income from Parent		1,607		1,295		4,156		3,858
Gross investment income		210,320		141,848		628,599		269,331
Investment expenses		(13,159)		(6,420)		(35,580)		(24,549)
Net investment income	$	197,161	$	135,428	$	593,019	$	244,782

(Some amounts may not reconcile due to rounding.)

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Fixed maturities $ 48,335 $ 44,810 $ 144,916 $ 134,931
Equity securities 6,267 7,870 19,385 25,752
Short-term investments and cash 648 296 1,628 851
Other invested assets
Limited partnerships 11,878 6,020 20,632 17,698
Dividends from preferred shares of affiliate 7,758 7,758 23,274 23,274
Other 1,484 522 4,232 339
Gross investment income before adjustments 76,370 67,276 214,067 202,845
Funds held interest income (expense) 1,098 1,090 4,015 4,718
Interest income from Parent 1,075 1,075 3,225 3,225
Gross investment income 78,543 69,441 221,307 210,788
Investment expenses (5,126 ) (4,871 ) (15,141 ) (13,901 )
Net investment income $ 73,417 $ 64,570 $ 206,166 $ 196,887

(Some amounts may not reconcile due to rounding.)

The Company records results from limited partnership investments on the equity method of accounting with changes in value reported through net investment income. The net investment income from limited partnerships is dependent upon the Company’s share of the net asset values of interests underlying each limited partnership. Due to the timing of receiving financial information from these partnerships, the results are generally reported on a one month or quarter lag. If the Company determines there has been a significant decline in value of a limited partnership during this lag period, a loss will be recorded in the period in which the Company identifies the decline.

The Company had contractual commitments to invest up to an additional ~~$348,144 thousand~~$,12152. million in limited partnerships and private placement loan securities at September 30, ~~2017.~~2021. These commitments will be funded when called in accordance with the partnership and loan agreements, which have investment periods that expire, unless extended, through ~~2023.~~

2026.

The ~~Company's other invested assets at September 30, 2017 and December 31, 2016 included $54,718 thousand and $57,126 thousand, respectively, related to~~Company participates in a private placement liquidity sweep ~~facility.~~facility (“the facility”). The primary purpose of the facility is to enhance the ~~Company's~~Company’s return on its short-term investments and cash positions. The facility invests in high quality, short-duration securities and permits daily liquidity. The Company consolidates its participation in the facility. As of September 30, 2021, the market value of investments in the facility consolidated within the Company’s balance sheets was $241.6 million.

Other invested assets, at fair value, as of September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, were comprised of preferred shares held in Everest Preferred International Holdings, ~~an affiliated company.~~

Ltd. (“Preferred Holdings”), a wholly-owned subsidiary of Group.

The components of net realized capital gains (losses) are presented in the table below for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Fixed maturity securities, market value:
Allowances for credit losses	$	(7,329)	$	2,289	$	(29,546)	$	(17,636)
Gains (losses) from sales		2,725		(31)		10,780		(19,005)
Fixed maturity securities, fair value:
Gains (losses) from sales		-		(1,968)		-		(1,968)
Gains (losses) from fair value adjustments		-		3,339		-		1,944
Equity securities, fair value:
Gains (losses) from sales		(488)		(281)		6,335		(11,609)
Gains (losses) from fair value adjustments		(4,446)		94,260		136,929		120,796
Other invested assets		1,920		1,085		6,014		50
Other invested assets, fair value:
Gains (losses) from fair value adjustments		(43,832)		15,741		136,798		(180,838)
Short-term investment gains (losses)		(1)		759		13		966
Total net realized capital gains (losses)	$	(51,451)	$	115,193	$	267,323	$	(107,300)

	Roll Forward of Allowance for Credit Losses
	Three Months Ended September 30, 2021										Nine Months Ended September 30, 2021
			Asset		Obligations of U.S. states and political subdivisions		Foreign						Asset		Obligations of U.S. states and political subdivisions		Foreign
	Corporate		Backed				Corporate				Corporate		Backed				Corporate
	Securities		Securities				Securities		Total		Securities		Securities				Securities		Total
Beginning Balance	$	(18,475)	$	(4,915)	$	-	$	(393)	$	(23,783)	$	(1,205)	$	-	$	-	$	(361)	$	(1,566)
Credit losses on securities where credit
losses were not previously recorded		(5,257)		-		(151)		-		(5,408)		(21,178)		(4,915)		(151)		(188)		(26,432)
Increases in allowance on previously
impaired securities		(620)		(2,765)		-		-		(3,385)		(2,088)		(2,765)		-		-		(4,853)
Decreases in allowance on previously
impaired securities		-		-		-		-		-		-		-		-		-		-
Reduction in allowance due to disposals		1,463		-		-		-		1,463		1,582		-		-		156		1,738

Balance as of September 30, 2021	$	(22,889)	$	(7,680)	$	(151)	$	(393)	$	(31,113)	$	(22,889)	$	(7,680)	$	(151)	$	(393)	$	(31,113)

	Roll Forward of Allowance for Credit Losses
	Three Months Ended September 30, 2020								Nine Months Ended September 30, 2020
			Foreign		Foreign						Foreign		Foreign
	Corporate		Government		Corporate				Corporate		Government		Corporate
	Securities		Securities		Securities		Total		Securities		Securities		Securities		Total

Beginning Balance	$	(19,398)	$	-	$	(527)	$	(19,925)	$	-	$	-	$	-	$	-
Credit losses on securities where credit
losses were not previously recorded		(6)		-		-		(6)		(21,829)		(70)		(561)		(22,460)
Increases in allowance on previously
impaired securities		(5,354)		-		-		(5,354)		(5,909)		-		(211)		(6,120)
Decreases in allowance on previously
impaired securities		65		-		128		193		1,303		-		244		1,547
Reduction in allowance due to disposals		7,456		-		-		7,456		9,198		70		129		9,397

Balance as of September 30, 2020	$	(17,237)	$	-	$	(399)	$	(17,636)	$	(17,237)	$	-	$	(399)	$	(17,636)

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Fixed maturity securities, market value:
Other-than-temporary impairments $ (1,473 ) $ (836 ) $ (4,179 ) $ (25,242 )
Gains (losses) from sales 3,842 4,338 16,814 (10,273 )
Fixed maturity securities, fair value:
Gain (losses) from sales - (1 ) - (1,855 )
Gains (losses) from fair value adjustments - 42 - 1,381
Equity securities, fair value:
Gains (losses) from sales (1,479 ) 5,452 3,465 (10,134 )
Gains (losses) from fair value adjustments 29,645 16,063 82,006 34,725
Other invested assets 85 - 84 -
Other invested assets, fair value:
Gains (losses) from fair value adjustments 197,869 (47,090 ) 155,775 (47,846 )
Gain (loss) on sale of subsidiary - (28,032 ) - (28,032 )
Short-term investment gains (losses) - 1 1 1
Total net realized capital gains (losses) $ 228,489 $ (50,063 ) $ 253,966 $ (87,275 )

The Company recorded as net realized capital gains (losses) in the consolidated statements of operations and comprehensive income (loss) ~~both~~ fair value re-measurements, allowances for credit losses per ASU 2016-13 and

write-downs in the value of securities deemed to be impaired on an other-than-temporary basis in prior years as displayed in the table above. ~~The Company had no other-than-temporary impaired securities where the impairment had both a credit and non-credit component.~~

The proceeds and split between gross gains and losses, from sales of fixed maturity and equity securities, are presented in the table below for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Proceeds from sales of fixed maturity securities	$	151,932	$	84,822	$	394,004	$	422,545
Gross gains from sales		8,868		4,977		24,067		15,578
Gross losses from sales		(6,143)		(6,976)		(13,287)		(36,551)

Proceeds from sales of equity securities	$	104,231	$	115,516	$	450,319	$	328,519
Gross gains from sales		2,769		9,503		17,706		30,256
Gross losses from sales		(3,257)		(9,784)		(11,371)		(41,865)

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Proceeds from sales of fixed maturity securities $ 410,636 $ 136,767 $ 1,063,126 $ 435,242
Gross gains from sales 7,931 6,257 23,674 13,875
Gross losses from sales (4,089 ) (1,920 ) (6,860 ) (26,003 )

Proceeds from sales of equity securities $ 52,754 $ 109,914 $ 302,407 $ 531,894
Gross gains from sales 2,199 6,874 13,774 13,509
Gross losses from sales (3,678 ) (1,422 ) (10,309 ) (23,643 )

4. RESERVES FOR LOSSES AND LAE

Activity in the reserve for losses and LAE is summarized for the periods indicated:

	Nine Months Ended September 30,
(Dollars in thousands)		2021		2020
Gross reserves beginning of period	$	11,654,950	$	10,209,519
Less reinsurance recoverables on unpaid losses		(3,951,474)		(4,215,348)
Net reserves beginning of period		7,703,476		5,994,171
Incurred related to:
Current year		4,106,331		3,288,049
Prior years		(3,610)		(4,853)
Total incurred losses and LAE		4,102,721		3,283,196
Paid related to:
Current year		1,117,795		856,707
Prior years		1,186,019		1,275,408
Total paid losses and LAE		2,303,814		2,132,115

Foreign exchange/translation adjustment and cumulative adjustment due to adoption of ASU 2016-13		(19,783)		(5,954)

Net reserves end of period		9,482,600		7,139,298
Plus reinsurance recoverables on unpaid losses		3,839,211		3,902,713
Gross reserves end of period	$	13,321,811	$	11,042,011

(Some amounts may not reconcile due to rounding.)

Nine Months Ended Twelve Months Ended
September 30, At December 31,
(Dollars in thousands) 2017 2016
Gross reserves at beginning of period $ 8,331,288 $ 7,940,720
Less reinsurance recoverables (4,199,791 ) (3,875,073 )
Net reserves at beginning of period 4,131,497 4,065,647

Incurred related to:
Current year 1,918,055 1,441,962
Prior years 453 (91,682 )
Total incurred losses and LAE 1,918,508 1,350,280

Paid related to:
Current year 441,480 400,489
Prior years 547,176 892,207
Total paid losses and LAE 988,656 1,292,696

Foreign exchange/translation adjustment 19,084 8,266

Net reserves at end of period 5,080,433 4,131,497
Plus reinsurance recoverables 4,888,715 4,199,791
Gross reserves at end of period $ 9,969,148 $ 8,331,288

Current year incurred losses were ~~$1,918,055 thousand~~$4,106.3 and $3,288.0 million for the nine months ended September 30, 2017 compared to $1,441,962 thousand for the full year 2016. The increase in current year incurred losses was primarily due to $1,039,295 thousand of catastrophe losses incurred in the nine months ended September 30, 2017, mainly related to Hurricane Irma, Hurricane Maria, Hurricane Harvey2021 and ~~the Mexico City earthquake. The $688,924 thousand increase in reinsurance recoverables from December 31, 2016 is primarily due to recoverables from these catastrophe losses.~~

~~Incurred prior years'~~2020, respectively. Gross and net reserves increased ~~by $453 thousand and decreased by $91,682 thousand~~ for the nine months ended September 30, ~~2017~~2021, reflecting an increase in underlying exposure due to premium growth and ~~the year ended December 31, 2016, respectively. The decrease~~catastrophe losses of $837.4 million and $341.0 million for the nine months ended September 30, 2021 and 2020, respectively. In addition, current year incurred losses for the nine months ended ~~December 31, 2016 was attributable to favorable development~~September 30, 2020 included $104.8 million of losses associated with the COVID-19 Pandemic which did not recur in the reinsurance segments of $187,909 thousand related primarily to property and short-tail business in the U.S., property business in Canada, Latin America, Middle East and Africa, as well as favorable development on prior year catastrophe2021.

losses, partially offset by $45,668 thousand of adverse development on A&E reserves. Part of the favorable development in the reinsurance segment related to the 2015 loss from the explosion at the Chinese port of Tianjin. In 2015, this loss was originally estimated to be $21,566 thousands. At December 31, 2016, this loss was projected to be $6,261 thousands resulting in $15,305 thousands of favorable development in 2016. The net favorable development in the reinsurance segments was partially offset by $96,227 thousand of unfavorable development in the insurance segment primarily related to run-off construction liability and umbrella program business.

5. FAIR VALUE

GAAP guidance regarding fair value measurements address how companies should measure fair value when they are required to use fair value measures for recognition or disclosure purposes under GAAP and provides a common definition of fair value to be used throughout GAAP. It defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly fashion between market participants at the measurement date. In addition, it establishes a three-level valuation hierarchy for the disclosure of fair value measurements. The valuation hierarchy is based on the transparency of inputs to the valuation of an asset or liability. The level in the hierarchy within which a given fair value measurement falls is determined based on the lowest level input that is significant to the measurement, with Level 1 being the highest priority and Level 3 being the lowest priority.

The levels in the hierarchy are defined as follows:

~~Level 1:~~

~~Inputs to the valuation methodology are observable inputs that reflect unadjusted quoted prices for identical assets or liabilities in an active market;~~

~~Level 2:~~

Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument;

~~Level 3:~~

~~Inputs to the valuation methodology are unobservable and significant to the fair value measurement.~~

Level 1Inputs to the valuation methodology are observable inputs that reflect unadjusted quoted prices for identical assets or liabilities in an active market;

Level 2:Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument;

Level 3:Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The ~~Company's~~Company’s fixed maturity and equity securities are primarily managed by third party investment asset managers. The investment asset managers managing publicly traded securities obtain prices from nationally recognized pricing services. These services seek to utilize market data and observations in their evaluation process. They use pricing applications that vary by asset class and incorporate available market information and when fixed maturity securities do not trade on a daily basis the services will apply available information through processes such as benchmark curves, benchmarking of like securities, sector groupings and matrix pricing. In addition, they use model processes, such as the Option Adjusted Spread model to develop prepayment and interest rate scenarios for securities that have prepayment features.

In limited instances where prices are not provided by pricing services or in rare instances when a manager may not agree with the pricing service, price quotes on a non-binding basis are obtained from investment brokers.

The investment asset managers do not make any changes to prices received from either the pricing services or the investment brokers. In addition, the investment asset managers have procedures in place to review the reasonableness of the prices from the service providers and may request verification of the prices. In addition, the Company continually performs analytical reviews of price changes and tests the prices on a random basis to an independent pricing source. No material variances were noted during these price validation procedures. In limited situations, where financial markets are inactive or illiquid, the Company may use its own assumptions about future cash flows and risk-adjusted discount rates to determine fair value. ~~Due to the unavailability of prices for forty-eight private placement securities, the investment manager's valuation committee valued the forty-eight securities at $105,199 thousand at~~At September 30, ~~2017. Due~~2021, $1,732.3 million of fixed maturities, market value were fair valued using unobservable inputs. The majority of the fixed maturities, market value, were valued by investment managers’ valuation committees and many of these fair values were substantiated by valuations from independent third parties. The Company has procedures in place to ~~the unavailability of prices for forty-two private placement securities, the investment manager's valuation committee valued the forty-two securities at $86,536 thousand at~~evaluate these independent third party valuations. At December 31, ~~2016.~~

2020, $1,259.6 million of fixed maturities, market value were fair valued using unobservable inputs.

The Company internally manages a public equity portfolio which had a fair value at September 30, ~~2017~~2021 and December 31, ~~2016~~2020 of ~~$218,533 thousand~~$1,253.9 million and ~~$133,755 thousand,~~$784.7 million, respectively, and all prices were obtained from ~~publically~~publicly published sources.

Equity securities denominated in U.S. currency with quoted prices in active markets for identical assets are categorized as ~~level~~Level 1 since the quoted prices are directly observable. Equity securities traded on foreign exchanges are categorized as ~~level~~Level 2 due to the added input of a foreign exchange conversion rate to determine fair or market value. The Company uses foreign currency exchange rates published by nationally recognized sources.

All categories of fixed maturity securities listed in the tables below are generally categorized as ~~level~~Level 2, since a particular security may not have traded but the pricing services are able to use valuation models with observable market inputs such as interest rate yield curves and prices for similar fixed maturity securities in terms of issuer, maturity and seniority. For foreign government securities and foreign corporate securities, the fair values provided by the third party pricing services in local currencies, and where applicable, are converted to U.S. dollars using currency exchange rates from nationally recognized sources.

~~The~~

In addition to the valuations from investment managers, some of the fixed maturities with fair values categorized as ~~level~~Level 3 result when prices are not available from the nationally recognized pricing services. The asset managers ~~will then~~may obtain non-binding price quotes for the securities from brokers. The single broker quotes are provided by market makers or broker-dealers who are recognized as market participants in the markets in which they are providing the quotes. The prices received from brokers are reviewed for reasonableness by the third party asset managers and the Company. If the broker quotes are for foreign denominated securities, the quotes are converted to U.S. dollars using currency exchange rates from nationally recognized sources. In limited circumstances when broker prices are not available for private placements, the Company will value the securities using comparable market ~~information.~~

information or receive fair values from investment managers.

The composition and valuation inputs for the presented fixed maturities categories Level 1 and Level 2 are as follows:

·	U.S. Treasury securities and obligations of U.S. government agencies and corporations are primarily comprised of U.S. Treasury bonds and the fair value is based on observable market inputs such as quoted prices, reported trades, quoted prices for similar issuances or benchmark yields;

·	Obligations of U.S. states and political subdivisions are comprised of state and municipal bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities, benchmark yields and credit spreads;

·	Corporate securities are primarily comprised of U.S. corporate and public utility bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities, benchmark yields and credit spreads;

·	Asset-backed and mortgage-backed securities fair values are based on observable inputs such as quoted prices, reported trades, quoted prices for similar issuances or benchmark yields and cash flow models using observable inputs such as prepayment speeds, collateral performance and default spreads;

Foreign government securities are comprised of global non-U.S. sovereign bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities and models with observable inputs such as benchmark yields and credit spreads and then, where applicable, converted to U.S. dollars using an exchange rate from a nationally recognized source;

Foreign corporate securities are comprised of global non-U.S. corporate bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities and models with observable inputs such as benchmark yields and credit spreads and then, where applicable, converted to U.S. dollars using an exchange rate from a nationally recognized source.

U.S. Treasury securities and obligations of U.S. government agencies and corporations are primarily comprised of U.S. Treasury bonds and the fair value is based on observable market inputs such as quoted prices, reported trades, quoted prices for similar issuances or benchmark yields;

Obligations of U.S. states and political subdivisions are comprised of state and municipal bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities, benchmark yields and credit spreads;

Corporate securities are primarily comprised of U.S. corporate and public utility bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities, benchmark yields and credit spreads;

Asset-backed and mortgage-backed securities fair values are based on observable inputs such as quoted prices, reported trades, quoted prices for similar issuances or benchmark yields and cash flow models using observable inputs such as prepayment speeds, collateral performance and default spreads;

Foreign government securities are comprised of global non-U.S. sovereign bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities and models with observable inputs such as benchmark yields and credit spreads and then, where applicable, converted to U.S. dollars using an exchange rate from a nationally recognized source;

Foreign corporate securities are comprised of global non-U.S. corporate bond issuances and the fair values are based on observable market inputs such as quoted market prices, quoted prices for similar securities and models with observable inputs such as benchmark yields and credit spreads and then, where applicable, converted to U.S. dollars using an exchange rate from a nationally recognized source.

Other invested assets, at fair value, ~~was~~were categorized as Level 3 at September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, since it represented a privately placed convertible preferred stock issued by an affiliate. The stock was received in exchange for shares of the ~~Company's~~Company’s parent. The ~~fair value of the~~25-year redeemable, convertible preferred stock ~~at September 30, 2017 and December 31, 2016 was determined~~with a 1.75% coupon is valued using a pricing model. The pricing model includes observable inputs such as the U.S. Treasury yield curve rate T note constant maturity 10 year and the swap rate on the Company’s June 1, 2044, 4.868% senior

notes, with adjustments to reflect the Company’s own assumptions about the inputs that market participants would use in pricing the asset.

The following table presents the fair value measurement levels for all assets, which the Company has recorded at fair value (fair and market value) as of the period indicated:

			Fair Value Measurement Using:
			Quoted Prices
			in Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
			Assets		Inputs		Inputs
(Dollars in thousands)	September 30, 2021		(Level 1)		(Level 2)		(Level 3)
Assets:
Fixed maturities, market value
U.S. Treasury securities and obligations of U.S. government agencies and corporations	$	624,050	$	-	$	624,050	$	-
Obligations of U.S. states and political subdivisions		607,375		-		607,375		-
Corporate securities		3,751,270		-		3,027,877		723,393
Asset-backed securities		3,182,647		-		2,178,578		1,004,069
Mortgage-backed securities
Commercial		598,383		-		598,383		-
Agency residential		1,015,112		-		1,015,112		-
Non-agency residential		4,976		-		4,976		-
Foreign government securities		713,349		-		713,349		-
Foreign corporate securities		1,400,318		-		1,395,444		4,874
Total fixed maturities, market value		11,897,480		-		10,165,144		1,732,336

Equity securities, fair value		1,488,355		1,451,271		37,084		-
Other invested assets, fair value		1,933,277		-		-		1,933,277

Fair Value Measurement Using:
Quoted Prices
in Active Significant
Markets for Other Significant
Identical Observable Unobservable
Assets Inputs Inputs
(Dollars in thousands) September 30, 2017 (Level 1) (Level 2) (Level 3)
Assets:
Fixed maturities, market value
U.S. Treasury securities and obligations of
U.S. government agencies and corporations $ 655,886 $ - $ 655,886 $ -
Obligations of U.S. States and political subdivisions 671,842 - 671,842 -
Corporate securities 2,239,591 - 2,137,522 102,069
Asset-backed securities 153,789 - 153,789 -
Mortgage-backed securities
Commercial 59,023 - 59,023 -
Agency residential 677,830 - 677,830 -
Non-agency residential 62 - 62 -
Foreign government securities 531,473 - 531,473 -
Foreign corporate securities 1,049,865 - 1,046,734 3,131
Total fixed maturities, market value 6,039,361 - 5,934,161 105,200

Equity securities, fair value 998,071 951,679 46,392 -
Other invested assets, fair value 1,922,402 - - 1,922,402

~~There were no transfers between Level 1 and Level 2 for the nine months ended September 30, 2017.~~

			Fair Value Measurement Using:
			Quoted Prices
			in Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
			Assets		Inputs		Inputs
(Dollars in thousands)	December 31, 2020		(Level 1)		(Level 2)		(Level 3)
Assets:
Fixed maturities, market value
U.S. Treasury securities and obligations of U.S. government agencies and corporations	$	681,989	$	-	$	681,989	$	-
Obligations of U.S. states and political subdivisions		577,046		-		577,046		-
Corporate securities		3,449,912		-		2,819,068		630,844
Asset-backed securities		2,474,170		-		1,851,137		623,033
Mortgage-backed securities
Commercial		550,080		-		550,080		-
Agency residential		965,100		-		965,100		-
Non-agency residential		3,164		-		3,164		-
Foreign government securities		742,238		-		742,238		-
Foreign corporate securities		1,199,866		-		1,194,167		5,699
Total fixed maturities, market value		10,643,565		-		9,383,989		1,259,576

Equity securities, fair value		1,288,767		1,222,158		66,609		-
Other invested assets, fair value		1,796,479		-		-		1,796,479

~~The following table presents the fair value measurement levels for all assets, which the Company has recorded at fair value (fair and market value) as of the period indicated:~~

Fair Value Measurement Using:
Quoted Prices
in Active Significant
Markets for Other Significant
Identical Observable Unobservable
Assets Inputs Inputs
(Dollars in thousands) December 31, 2016 (Level 1) (Level 2) (Level 3)
Assets:
Fixed maturities, market value
U.S. Treasury securities and obligations of
U.S. government agencies and corporations $ 691,080 $ - $ 691,080 $ -
Obligations of U.S. States and political subdivisions 729,984 - 729,984 -
Corporate securities 2,154,203 - 2,089,006 65,197
Asset-backed securities 137,027 - 137,027 -
Mortgage-backed securities
Commercial 75,493 - 75,493 -
Agency residential 715,144 - 715,144 -
Non-agency residential 88 - 88 -
Foreign government securities 507,277 - 507,277 -
Foreign corporate securities 960,200 - 957,662 2,538
Total fixed maturities, market value 5,970,496 - 5,902,761 67,735

Equity securities, fair value 887,800 827,237 60,563 -
Other invested assets, fair value 1,766,626 - - 1,766,626

In addition, ~~$70,657 thousand~~$266.3 million and ~~$18,801 thousand~~$224.7 million of investments within other invested assets on the consolidated balance sheets as of September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively, are not included within the fair value hierarchy tables as the assets are ~~valued using the~~measured at NAV as a practical expedient ~~guidance within ASU 2015-07.~~

to determine fair value.

The following ~~table presents~~tables present the activity under Level 3, fair value measurements using significant unobservable inputs by asset type, for the periods indicated:

	Total Fixed Maturities, Market Value
	Three Months Ended September 30, 2021								Nine Months Ended September 30, 2021
			Asset								Asset
(Dollars in thousands)	Corporate Securities		Backed Securities		Foreign Corporate		Total		Corporate Securities		Backed Securities		Foreign Corporate		Total
Beginning balance	$	634,923	$	815,276	$	4,886	$	1,455,085	$	630,843	$	623,033	$	5,700	$	1,259,576
Total gains or (losses) (realized/unrealized)
Included in earnings		3,184		(3,292)		33		(75)		(12,366)		(7,254)		173		(19,447)
Included in other comprehensive income (loss)		(1,311)		(381)		(34)		(1,726)		6,107		4,094		(70)		10,131
Purchases, issuances and settlements		86,597		192,466		(11)		279,052		98,809		384,196		(929)		482,076
Transfers in and/or (out) of Level 3		-		-		-		-		-		-		-		-
Ending balance	$	723,393	$	1,004,069	$	4,874	$	1,732,336	$	723,393	$	1,004,069	$	4,874	$	1,732,336
The amount of total gains or losses for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at the reporting date	$	761	$	(2,764)	$	-	$	(2,003)	$	(16,518)	$	(7,679)	$	-	$	(24,197)

(Some amounts may not reconcile due to rounding.)

Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017
Corporate Foreign Corporate Foreign
(Dollars in thousands) Securities Corporate Total Securities Corporate Total
Beginning balance $ 86,140 $ 3,151 $ 89,291 $ 65,197 $ 2,538 $ 67,735
Total gains or (losses) (realized/unrealized)
Included in earnings 283 210 493 1,208 314 1,522
Included in other comprehensive income (loss) 18 (230 ) (212 ) 161 (230 ) (69 )
Purchases, issuances and settlements 15,628 - 15,628 35,503 509 36,012
Transfers in and/or (out) of Level 3 - - - - - -
Ending balance $ 102,069 $ 3,131 $ 105,200 $ 102,069 $ 3,131 $ 105,200

The amount of total gains or losses for the period included
in earnings (or changes in net assets) attributable to the
change in unrealized gains or losses relating to assets
still held at the reporting date $ - $ - $ - $ - $ - $ -

(Some amounts may not reconcile due to rounding.)

	Total Fixed Maturities, Market Value
	Three Months Ended September 30, 2020								Nine Months Ended September 30, 2020
			Asset								Asset
(Dollars in thousands)	Corporate Securities		Backed Securities		Foreign Corporate		Total		Corporate Securities		Backed Securities		Foreign Corporate		Total
Beginning balance	$	651,186	$	295,730	$	6,274	$	953,190	$	546,939	$	153,641	$	1,751	$	702,331
Total gains or (losses) (realized/unrealized)
Included in earnings		361		457		26		844		(101)		582		(71)		410
Included in other comprehensive income (loss)		(992)		5,028		126		4,162		(4,898)		7,238		86		2,426
Purchases, issuances and settlements		(1,349)		103,574		139		102,364		112,061		243,328		3,822		359,211
Transfers in and/or (out) of Level 3		4,189		-		(863)		3,326		(606)		-		114		(492)
Ending balance	$	653,395	$	404,789	$	5,702	$	1,063,886	$	653,395	$	404,789	$	5,702	$	1,063,886
The amount of total gains or losses for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at the reporting date	$	-	$	-	$	-	$	-	$	(539)	$	-	$	-	$	(539)

(Some amounts may not reconcile due to rounding.)

The net transfers to/(from) Level 3, fair value measurements using significant unobservable inputs for fixed maturities, market value were $3.3 million and ($0.5) million for the three and nine months ended September 30, 2020, respectively. The net transfers for the three months ended September 30, 2020 were previously priced using a recognized pricing service and were subsequently priced by investment managers as of September 30, 2020. The net transfers for the nine months ended September 30, 2020 were previously priced by investment managers and were subsequently priced using a recognized pricing service as of September 30,2020.

	Total Fixed Maturities, Fair Value
	Three Months Ended September 30, 2020				Nine Months Ended September 30, 2020
	Foreign				Foreign
(Dollars in thousands)	Corporate		Total		Corporate		Total
Beginning balance fixed maturities at fair value	$	4,431	$	4,431	$	5,826	$	5,826
Total gains or (losses) (realized/unrealized)
Included in earnings		1,371		1,371		(24)		(24)
Included in other comprehensive income (loss)		-		-		-		-
Purchases, issuances and settlements		(2,054)		(2,054)		(2,054)		(2,054)
Transfers in and/or (out) of Level 3		-		-		-		-
Ending balance	$	3,748	$	3,748	$	3,748	$	3,748
The amount of total gains or losses for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at the reporting date	$	-	$	-	$	-	$	-

(Some amounts may not reconcile due to rounding.)

The following table presents the activity under Level 3, fair value measurements using significant unobservable inputs by equity securities for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Equity securities
Balance, beginning of period	$	-	$	9,877	$	-	$	-
Total (gains) or losses (realized/unrealized)
Included in earnings		-		-		-		-
Included in other comprehensive income (loss)		-		-		-		-
Purchases, issuances and settlements		-		-		-		9,877
Transfers in and/or (out) of Level 3		-		(9,877)		-		(9,877)
Balance, end of period	$	-	$	-	$	-	$	-

The amount of total gains or losses for the period included in earnings
(or changes in net assets) attributable to the change in unrealized
gains or losses relating to liabilities still held at the reporting date	$	-	$	-	$	-	$	-

(Some amounts may not reconcile due to rounding.)

Three Months Ended September 30, 2016 Nine Months Ended September 30, 2016
Corporate Foreign Corporate Foreign
(Dollars in thousands) Securities CMBS Corporate Total Securities CMBS Corporate Total
Beginning balance $ 32,410 $ - $ 2,021 $ 34,431 $ 3,933 $ - $ 1,593 $ 5,526
Total gains or (losses) (realized/unrealized)
Included in earnings (12 ) - 27 15 (22 ) - (970 ) (992 )
Included in other comprehensive income (loss) (48 ) (34 ) (1,285 ) (1,367 ) (81 ) (34 ) 140 25
Purchases, issuances and settlements 25,877 (40 ) 2,231 28,068 54,397 (40 ) 2,231 56,588
Transfers in and/or (out) of Level 3 (1,932 ) 3,553 - 1,621 (1,932 ) 3,553 - 1,621
Ending balance $ 56,295 $ 3,479 $ 2,994 $ 62,768 $ 56,295 $ 3,479 $ 2,994 $ 62,768

The amount of total gains or losses for the period included
in earnings (or changes in net assets) attributable to the
change in unrealized gains or losses relating to assets
still held at the reporting date $ - $ - $ - $ - $ - $ - $ (997 ) $ (997 )

(Some amounts may not reconcile due to rounding.)

The net transfers to/(from) level 3, fair value measurements using significant unobservable inputs for equity securities, fair value were ~~$0 thousand~~($9.9) million for both the three and ~~$1,621 thousand of investments for the~~ nine months ended September 30, ~~2017~~2020. The transfers of ($9.9) million during both the three and ~~2016, respectively. The $1,621 thousand of investments for the~~ nine months ended September 30, ~~2016~~2020, were related to preferred stock in a private entity purchased during the ~~net impact~~second quarter of ~~securities no longer~~2020 which was priced ~~by a recognized pricing service.~~

at cost as of June 30, 2020 and was subsequently priced based upon the book value of the underlying private entity as of September 30, 2020.

The following table presents the activity under Level 3, fair value measurements using significant unobservable inputs by other invested assets, for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Other invested assets, fair value:
Beginning balance	$	1,977,109	$	1,786,003	$	1,796,479	$	1,982,582
Total gains or (losses) (realized/unrealized)
Included in earnings		(43,832)		15,740		136,798		(180,839)
Included in other comprehensive income (loss)		-		-		-		-
Purchases, issuances and settlements		-		-		-		-
Transfers in and/or (out) of Level 3		-		-		-		-
Ending balance	$	1,933,277	$	1,801,743	$	1,933,277	$	1,801,743
The amount of total gains or losses for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at the reporting date	$	-	$	-	$	-	$	-

(Some amounts may not reconcile due to rounding.)

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Other invested assets, fair value:
Beginning balance $ 1,724,532 $ 1,772,458 $ 1,766,626 $ 1,773,214
Total gains or (losses) (realized/unrealized)
Included in earnings 197,870 (47,090 ) 155,776 (47,846 )
Included in other comprehensive income (loss) - - - -
Purchases, issuances and settlements - - - -
Transfers in and/or (out) of Level 3 - - - -
Ending balance $ 1,922,402 $ 1,725,367 $ 1,922,402 $ 1,725,367

The amount of total gains or losses for the period included in earnings
(or changes in net assets) attributable to the change in unrealized
gains or losses relating to assets still held at the reporting date $ - $ - $ - $ -

(Some amounts may not reconcile due to rounding.)

6. COMMITMENTS AND CONTINGENCIES

funds or enforce alleged rights. These disputes arise from time to time and are ultimately resolved through both informal and formal means, including negotiated resolution, arbitration and litigation. In all such matters, the Company believes that its positions are legally and commercially reasonable. The Company considers the statuses of these proceedings when determining its reserves for unpaid loss and loss adjustment expenses.

Aside from litigation and arbitrations related to these insurance and reinsurance agreements, the Company is not a party to any other material litigation or arbitration.

The Company has entered into separate annuity agreements with The Prudential Insurance Company of America ("(“The ~~Prudential"~~Prudential”) and an additional unaffiliated life insurance company in which the Company has either purchased annuity contracts or become the assignee of annuity proceeds that are meant to settle claim payment obligations in the future. In both instances, the Company would become contingently liable if either

The Prudential or the unaffiliated life insurance company were unable to make payments related to the respective annuity ~~contact.~~

contract.

The table below presents the estimated cost to replace all such annuities for which the Company was contingently liable for the periods indicated:

	At September 30, 2021		At December 31, 2020
(Dollars in thousands)	At September 30, 2021		At December 31, 2020
The Prudential	$	138,869	$	140,773
Unaffiliated life insurance company		34,163		35,128

At September 30, At December 31,
(Dollars in thousands) 2017 2016
The Prudential $ 144,331 $ 146,507
Unaffiliated life insurance company 33,769 33,860

7. COMPREHENSIVE INCOME (LOSS)

The following ~~table presents~~tables present the components of comprehensive income (loss) in the consolidated statements of operations and comprehensive income (loss) for the periods indicated:

	Three Months Ended September 30, 2021						Nine Months Ended September 30, 2021
(Dollars in thousands)	Before Tax		Tax Effect		Net of Tax		Before Tax		Tax Effect		Net of Tax
Unrealized appreciation (depreciation) ("URA(D)") on securities - non-credit related temporary	$	(55,005)		11,524	$	(43,482)	$	(139,099)		29,170	$	(109,930)
Reclassification of net realized losses (gains) included in net income (loss)		2,683		(524)		2,160		12,751		(2,660)		10,092
Foreign currency translation adjustments		(26,357)		5,495		(20,862)		(5,789)		1,174		(4,615)
Reclassification of amortization of net gain (loss) included in net income (loss)		1,978		(416)		1,563		7,150		(1,502)		5,649
Total other comprehensive income (loss)	$	(76,701)	$	16,079	$	(60,621)	$	(124,987)	$	26,182	$	(98,804)

(Some amounts may not reconcile due to rounding)

Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017
(Dollars in thousands) Before Tax Tax Effect Net of Tax Before Tax Tax Effect Net of Tax
Unrealized appreciation (depreciation) ("URA(D)") on securities - temporary $ 852 $ (219 ) $ 633 $ 24,656 $ (8,279 ) $ 16,377
URA(D) on securities - OTTI (158 ) 55 (103 ) (3,974 ) 1,391 (2,583 )
Reclassification of net realized losses (gains) included in net income (loss) (2,454 ) 780 (1,674 ) (12,719 ) 4,101 (8,618 )
Foreign currency translation adjustments 52,740 (18,459 ) 34,281 66,492 (23,272 ) 43,220
Benefit plan actuarial net gain (loss) - - - - - -
Reclassification of amortization of net gain (loss) included in net income (loss) 2,107 (738 ) 1,369 8,273 (2,896 ) 5,377
Total other comprehensive income (loss) $ 53,088 $ (18,581 ) $ 34,507 $ 82,729 $ (28,955 ) $ 53,774

(Some amounts may not reconcile due to rounding)

Three Months Ended September 30, 2016 Nine Months Ended September 30, 2016
(Dollars in thousands) Before Tax Tax Effect Net of Tax Before Tax Tax Effect Net of Tax
Unrealized appreciation (depreciation) ("URA(D)") on securities - temporary $ 8,305 $ (2,909 ) $ 5,396 $ 92,221 $ (32,279 ) $ 59,942
URA(D) on securities - OTTI (2,444 ) 856 (1,588 ) 4,199 (1,469 ) 2,730
Reclassification of net realized losses (gains) included in net income (loss) (4,258 ) 1,491 (2,767 ) 35,515 (12,430 ) 23,085
Foreign currency translation adjustments (4,066 ) 1,424 (2,642 ) 42,741 (14,962 ) 27,779
Benefit plan actuarial net gain (loss) - - - - - -
Reclassification of amortization of net gain (loss) included in net income (loss) 1,951 (683 ) 1,268 6,076 (2,127 ) 3,949
Total other comprehensive income (loss) $ (512 ) $ 179 $ (333 ) $ 180,752 $ (63,267 ) $ 117,485

(Some amounts may not reconcile due to rounding)

	Three Months Ended September 30, 2020						Nine Months Ended September 30, 2020
(Dollars in thousands)	Before Tax		Tax Effect		Net of Tax		Before Tax		Tax Effect		Net of Tax
Unrealized appreciation (depreciation) ("URA(D)") on securities - temporary	$	48,819		(10,247)	$	38,572	$	132,405		(27,807)	$	104,598
Reclassification of net realized losses (gains) included in net income (loss)		(3,343)		738		(2,605)		36,591		(7,767)		28,824
Foreign currency translation adjustments		18,239		(3,825)		14,414		(8,618)		1,835		(6,783)
Reclassification of amortization of net gain (loss) included in net income (loss)		2,285		(480)		1,806		5,736		(1,205)		4,532
Total other comprehensive income (loss)	$	66,000	$	(13,814)	$	52,187	$	166,114	$	(34,944)	$	131,171

(Some amounts may not reconcile due to rounding)

The following table presents details of the amounts reclassified from AOCI for the periods indicated:

	Three Months Ended				Nine Months Ended				Affected line item within the
	September 30,				September 30,				statements of operations and
AOCI component	2021		2020		2021		2020		comprehensive income (loss)
(Dollars in thousands)
URA(D) on securities	$	2,683	$	(3,343)	$	12,751	$	36,591	Other net realized capital gains (losses)
		(524)		738		(2,660)		(7,767)	Income tax expense (benefit)
	$	2,160	$	(2,605)	$	10,092	$	28,824	Net income (loss)
Benefit plan net gain (loss)	$	1,978	$	2,285	$	7,150	$	5,736	Other underwriting expenses
		(416)		(480)		(1,502)		(1,205)	Income tax expense (benefit)
	$	1,563	$	1,806	$	5,649	$	4,532	Net income (loss)

(Some amounts may not reconcile due to rounding)

Three Months Ended Nine Months Ended
September 30, September 30, Affected line item within the statements of
AOCI component 2017 2016 2017 2016 operations and comprehensive income (loss)
(Dollars in thousands)
URA(D) on securities $ (2,454 ) $ (4,258 ) $ (12,719 ) $ 35,515 Other net realized capital gains (losses)
780 1,491 4,101 (12,430 ) Income tax expense (benefit)
$ (1,674 ) $ (2,767 ) $ (8,618 ) $ 23,085 Net income (loss)

Benefit plan net gain (loss) $ 2,107 $ 1,951 $ 8,273 $ 6,076 Other underwriting expenses
(738 ) (683 ) (2,896 ) (2,127 ) Income tax expense (benefit)
$ 1,369 $ 1,268 $ 5,377 $ 3,949 Net income (loss)

(Some amounts may not reconcile due to rounding)

The following table presents the components of accumulated other comprehensive income (loss), net of tax, in the consolidated balance sheets for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Beginning balance of URA (D) on securities	$	254,645	$	222,068	$	313,161	$	124,612
Current period change in URA (D) of investments - non-credit related		(41,322)		35,967		(99,838)		133,422
Ending balance of URA (D) on securities		213,323		258,034		213,323		258,034

Beginning balance of foreign currency translation adjustments		44,974		(6,931)		28,727		14,267
Current period change in foreign currency translation adjustments		(20,862)		14,414		(4,615)		(6,783)
Ending balance of foreign currency translation adjustments		24,112		7,483		24,112		7,483

Beginning balance of benefit plan net gain (loss)		(69,784)		(71,829)		(73,870)		(74,556)
Current period change in benefit plan net gain (loss)		1,562		1,806		5,649		4,532
Ending balance of benefit plan net gain (loss)		(68,221)		(70,023)		(68,221)		(70,023)

Ending balance of accumulated other comprehensive income (loss)	$	169,214	$	195,495	$	169,214	$	195,495

Nine Months Ended Twelve Months Ended
September 30, December 31,
(Dollars in thousands) 2017 2016

Beginning balance of URA (D) on securities $ 39,041 $ 13,654
Current period change in URA (D) of investments - temporary 7,759 22,063
Current period change in URA (D) of investments - non-credit OTTI (2,583 ) 3,324
Ending balance of URA (D) on securities 44,218 39,041

Beginning balance of foreign currency translation adjustments (9,852 ) (12,701 )
Current period change in foreign currency translation adjustments 43,220 2,849
Ending balance of foreign currency translation adjustments 33,368 (9,852 )

Beginning balance of benefit plan net gain (loss) (65,504 ) (63,089 )
Current period change in benefit plan net gain (loss) 5,377 (2,415 )
Ending balance of benefit plan net gain (loss) (60,127 ) (65,504 )

Ending balance of accumulated other comprehensive income (loss) $ 17,459 $ (36,315 )

8. COLLATERALIZED REINSURANCE AND TRUST AGREEMENTS

A subsidiary of the Company, Everest Re, has established a trust agreement, which effectively uses Everest ~~Re's~~Re’s investments as collateral, as security for assumed losses payable to a non-affiliated ceding ~~company.~~companies. At September 30, ~~2017,~~2021, the total amount on deposit in the trust account was ~~$659,548 thousand.~~

~~On April 24, 2014, the~~$1,065.6 million.

The Company entered into ~~two~~various collateralized reinsurance agreements with Kilimanjaro Re Limited ~~("Kilimanjaro"~~(“Kilimanjaro”), a Bermuda based special purpose reinsurer, to provide the Company with catastrophe reinsurance coverage. These agreements are multi-year reinsurance contracts which cover ~~specified~~ named storm and earthquake events. The ~~first agreement provides up to $250,000 thousand of reinsurance coverage from named storms in specified states of~~table below summarizes the Southeastern United States. The second agreement provides up to $200,000 thousand of reinsurance coverage from named storms in specified states of the Southeast, Mid-Atlantic and Northeast regions of the United States and Puerto Rico as well as reinsurance coverage from earthquakes in specified states of the Southeast, Mid-Atlantic, Northeast and West regions of the United States, Puerto Rico and British Columbia.various agreements:

(Dollars in thousands)
Class	Description	Effective Date	Expiration Date	Limit		Coverage Basis

Series 2017-1 Class A-2	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/13/2017	4/13/2022		50,000	Aggregate
Series 2017-1 Class B-2	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/13/2017	4/13/2022		75,000	Aggregate
Series 2017-1 Class C-2	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/13/2017	4/13/2022		175,000	Aggregate
Series 2018-1 Class A-1	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/30/2018	5/6/2022		62,500	Aggregate
Series 2018-1 Class B-1	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/30/2018	5/6/2022		200,000	Aggregate
Series 2018-1 Class A-2	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/30/2018	5/5/2023		62,500	Aggregate
Series 2018-1 Class B-2	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/30/2018	5/5/2023		200,000	Aggregate
Series 2019-1 Class A-1	US, Canada, Puerto Rico – Named Storm and Earthquake Events	12/12/2019	12/19/2023		150,000	Occurrence
Series 2019-1 Class B-1	US, Canada, Puerto Rico – Named Storm and Earthquake Events	12/12/2019	12/19/2023		275,000	Aggregate
Series 2019-1 Class A-2	US, Canada, Puerto Rico – Named Storm and Earthquake Events	12/12/2019	12/19/2024		150,000	Occurrence
Series 2019-1 Class B-2	US, Canada, Puerto Rico – Named Storm and Earthquake Events	12/12/2019	12/19/2024		275,000	Aggregate
Series 2021-1 Class A-1	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/8/2021	4/21/2025		150,000	Occurrence
Series 2021-1 Class B-1	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/8/2021	4/21/2025		85,000	Aggregate
Series 2021-1 Class C-1	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/8/2021	4/21/2025		85,000	Aggregate
Series 2021-1 Class A-2	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/8/2021	4/20/2026		150,000	Occurrence
Series 2021-1 Class B-2	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/8/2021	4/20/2026		90,000	Aggregate
Series 2021-1 Class C-2	US, Canada, Puerto Rico – Named Storm and Earthquake Events	4/8/2021	4/20/2026		90,000	Aggregate

	Total available limit as of September 30, 2021			$	2,325,000

On November 18, 2014, the Company entered into a collateralized reinsurance agreement with Kilimanjaro to provide the Company with catastrophe reinsurance coverage. This agreement is a multi-year reinsurance contract which covers specified earthquake events. The agreement provides up to $500,000 thousand of reinsurance coverage from earthquakes in the United States, Puerto Rico and Canada.

On December 1, 2015 the Company entered into two collateralized reinsurance agreements with Kilimanjaro to provide the Company with catastrophe reinsurance coverage. These agreements are multi-year reinsurance contracts which cover named storm and earthquake events. The first agreement provides up to $300,000 thousand of reinsurance coverage from named storms and earthquakes in the United States, Puerto Rico and Canada. The second agreement provides up to $325,000 thousand of reinsurance coverage from named storms and earthquakes in the United States, Puerto Rico and Canada.

On April 13, 2017 the Company entered into six collateralized reinsurance agreements with Kilimanjaro to provide the Company with annual aggregate catastrophe reinsurance coverage. The initial three agreements are four year reinsurance contracts which cover named storm and earthquake events. These agreements provide up to $225,000 thousand, $400,000 thousand and $325,000 thousand, respectively, of annual aggregate reinsurance coverage from named storms and earthquakes in the United States, Puerto Rico and Canada. The subsequent three agreements are five year reinsurance contracts which cover named storm and earthquake events. These agreements provide up to $50,000 thousand, $75,000 thousand and $175,000 thousand, respectively, of annual aggregate reinsurance coverage from named storms and earthquakes in the United States, Puerto Rico and Canada.

Recoveries under these collateralized reinsurance agreements with Kilimanjaro are primarily dependent on estimated industry level insured losses from covered events, as well as, the geographic location of the events. The estimated industry level of insured losses is obtained from published estimates by an independent recognized authority on insured property losses. ~~As of September 30, 2017,~~Currently, none of the published insured loss estimates for ~~the 2017~~ catastrophe events during the applicable covered periods of the various agreements have exceeded the single event retentions or aggregate retentions under the terms of the agreements that would result in a recovery. In addition, the aggregation of the to date published insured loss estimates for the 2017 covered events have not exceeded the aggregated retentions for recovery. However, if the published estimates for insured losses for the covered 2017 events increase or if there are additional covered events during the remainder of 2017, the aggregate losses may exceed the aggregate event retentions under the agreements, resulting in a recovery.

Kilimanjaro has financed the various property catastrophe reinsurance coverages by issuing catastrophe bonds to unrelated, external investors. On April 24, 2014, Kilimanjaro issued $450,000 thousand of notes ("Series 2014-1 Notes"). On November 18, 2014, Kilimanjaro issued $500,000 thousand of notes ("Series 2014-2 Notes"). On December 1, 2015, Kilimanjaro issued $625,000 thousand of notes ("Series 2015-1 Notes). On April 13, 2017, Kilimanjaro issued $950,000 thousand of notes ("Series 2017-1 Notes) and $300,000 thousand of notes ("Series 2017-2 Notes). The proceeds from the issuance of the Notes listed ~~above~~below are held in reinsurance ~~trust~~trusts throughout the duration of the applicable reinsurance agreements and invested solely in US government money market funds with a rating of at least ~~"AAAm"~~“AAAm” by Standard & ~~Poor's.~~Poor’s.

~~10.~~

(Dollars in thousands)
Note Series	Issue Date	Maturity Date	Amount
Series 2017-1 Class A-2	4/13/2017	4/13/2022		50,000
Series 2017-1 Class B-2	4/13/2017	4/13/2022		75,000
Series 2017-1 Class C-2	4/13/2017	4/13/2022		175,000
Series 2018-1 Class A-1	4/30/2018	5/6/2022		62,500
Series 2018-1 Class B-1	4/30/2018	5/6/2022		200,000
Series 2018-1 Class A-2	4/30/2018	5/5/2023		62,500
Series 2018-1 Class B-2	4/30/2018	5/5/2023		200,000
Series 2019-1 Class A-1	12/12/2019	12/19/2023		150,000
Series 2019-1 Class B-1	12/12/2019	12/19/2023		275,000
Series 2019-1 Class A-2	12/12/2019	12/19/2024		150,000
Series 2019-1 Class B-2	12/12/2019	12/19/2024		275,000
Series 2021-1 Class A-1	4/8/2021	4/21/2025		150,000
Series 2021-1 Class B-1	4/8/2021	4/21/2025		85,000
Series 2021-1 Class C-1	4/8/2021	4/21/2025		85,000
Series 2021-1 Class A-2	4/8/2021	4/20/2026		150,000
Series 2021-1 Class B-2	4/8/2021	4/20/2026		90,000
Series 2021-1 Class C-2	4/8/2021	4/20/2026		90,000

9. SENIOR NOTES

The table below displays ~~Holdings'~~Holdings’ outstanding senior notes. Market value is based on quoted market prices, but due to limited trading activity, these senior notes are considered Level 2 in the fair value hierarchy.

				September 30, 2021				December 31, 2020
				Consolidated				Consolidated
			Principal	Balance Sheet		Market		Balance Sheet		Market
(Dollars in thousands)	Date Issued	Date Due	Amounts	Amount		Value		Amount		Value
4.868% Senior notes	06/05/2014	06/01/2044	400,000	$	397,284	$	506,828	$	397,194	$	528,000
3.5% Senior notes	10/07/2020	10/15/2050	1,000,000	$	979,915	$	1,065,400	$	979,524	$	1,138,100

September 30, 2017 December 31, 2016
Consolidated Balance Consolidated Balance
(Dollars in thousands) Date Issued Date Due Principal Amounts Sheet Amount Market Value Sheet Amount Market Value
4.868% Senior notes 06/05/2014 06/01/2044 400,000 $ 396,804 $ 420,008 $ 396,714 $ 383,612

On June 5, 2014, Holdings issued ~~$400,000 thousand~~$400.0 million of 30 year senior notes at 4.868%, which will mature on June 1, 2044. Interest ~~will be~~is paid semi-annually on June 1 and December 1 of each year.

On October 7, 2020, Holdings issued $1,000.0 million of 30 year senior notes an interest coupon rate of 3.5% which will mature on October 15, 2050. Interest is paid semi-annually on April 15th and October 15th of each year.

On October 4, 2021, Holdings issued $1,000.0 million of 31 year senior notes an interest coupon rate of 3.125% which will mature on October 15, 2052. Interest is paid semi-annually on April 15th and October 15th of each year.

Interest expense incurred in connection with these senior notes is as follows for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Interest expense incurred 4.868% Senior notes	$	4,868	$	4,868	$	14,604	$	14,604
Interest expense incurred 3.5% Senior notes	$	8,805	$	-	$	26,415	$	-

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Interest expense incurred $ 4,868 $ 4,868 $ 14,604 $ 14,604

~~11.~~

10. LONG TERM SUBORDINATED NOTES

The table below displays ~~Holdings'~~Holdings’ outstanding fixed to floating rate long term subordinated notes. Market value is based on quoted market prices, but due to limited trading activity, these subordinated notes are considered Level 2 in the fair value hierarchy.

September 30, 2021

December 31, 2020

Original

Consolidated

Principal

Maturity Date

Balance

Market

Balance

Market

(Dollars in thousands)

Date Issued

Amount

Scheduled

Final

Sheet Amount

Value

Sheet Amount

Value

Long term subordinated notes

04/26/2007

400,000

05/15/2037

05/01/2067

223,749

216,043

223,674

206,447

Maturity Date September 30, 2017 December 31, 2016
Original Consolidated Balance Consolidated Balance
(Dollars in thousands) Date Issued Principal Amount Scheduled Final Sheet Amount Market Value Sheet Amount Market Value
6.6% Long term subordinated notes 04/26/2007 $ 400,000 05/15/2037 05/01/2067 $ 236,536 $ 221,380 $ 236,462 $ 204,636

During the fixed rate interest period from May 3, 2007 through May 14, 2017, interest was at the annual rate of 6.6%, payable semi-annually in arrears on November 15 and May 15 of each year, commencing on November 15, 2007. During the floating rate interest period from May 15, 2017 through maturity, interest will be based on the 3 month LIBOR plus 238.5 basis points, reset quarterly, payable quarterly in arrears on February 15, May 15, August 15 and November 15 of each year, subject to ~~Holdings'~~Holdings’ right to defer interest on ~~one~~1 or more occasions for up to ten consecutive years. Deferred interest will accumulate interest at the applicable rate compounded quarterly for periods from and including ~~August~~May 15, 2017. The reset quarterly interest rate for ~~November 15, 2017~~August 16, 2021 to November ~~15, 2017~~14, 2021 is ~~3.70%~~2.51%.

Holdings may redeem the long term subordinated notes on or after May 15, 2017, in whole or in part at 100% of the principal amount plus accrued and unpaid interest; however, redemption on or after the scheduled maturity date and prior to May 1, 2047 is subject to a replacement capital covenant. This covenant is for the benefit of certain senior note holders and it mandates that Holdings receive proceeds from the sale of another subordinated debt issue, of at least similar size, before it may redeem the subordinated notes. Effective upon the maturity of the ~~Company's~~Company’s 5.40% senior notes on October 15, 2014, the ~~Company's~~Company’s 4.868% senior notes, due on June 1, 2044, have become the ~~Company's~~Company’s long term indebtedness that ranks senior to the long term subordinated notes.

The Company repurchased and retired $0 million and $13.2 million of its outstanding long term subordinated notes during the three and nine months ended September 30, 2020, respectively. The Company realized a gain of $0 million and $2.5 million from the repurchase of the long term subordinated notes during the three and nine months ended September 30, 2020, respectively. NaN repurchases of debt were made during the three and nine months ended September 30, 2021.

On March 19, 2009, Group announced the commencement of a cash tender offer for any and all of the 6.60% fixed to floating rate long term subordinated notes. Upon expiration of the tender offer, the Company had reduced its outstanding debt by ~~$161,441 thousand.~~

$161.4 million. In addition, during 2020, the Company repurchased and retired $13.2 million of these notes.

Interest expense incurred in connection with these long term subordinated notes is as follows for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Interest expense incurred	$	1,456	$	1,587	$	4,378	$	6,126

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Interest expense incurred $ 2,240 $ 3,937 $ 9,210 $ 11,811

11. FEDERAL HOME LOAN BANK MEMBERSHIP

Everest Re is a member of the Federal Home Loan Bank of New York (“FHLBNY”), which allows Everest Re to borrow up to 10% of its statutory admitted assets. As of September 30, 2021, Everest Re had admitted assets of approximately $18,874.0 million which provides borrowing capacity of up to approximately $1,887.4 million.

During 2020, Everest Re borrowed $400.0 million under its FHLBNY capacity. The borrowings have interest payable at an interest rate of 0.35%. As of September 30, 2021, $310.0 million of these borrowings remain outstanding, with maturities in November and December 2021. The FHLBNY membership agreement requires that 4.5% of borrowed funds be used to acquire additional membership stock.

12. SEGMENT REPORTING

The ~~U.S.~~ Reinsurance operation writes worldwide property and casualty reinsurance and specialty lines of ~~business, including Marine, Aviation, Surety and Accident and Health ("A&H")~~ business, on both a treaty and facultative basis, through reinsurance brokers, as well as directly with ceding ~~companies primarily within~~companies. Business is written in the ~~U.S. The International operation writes non-U.S. property and casualty reinsurance~~United States as well as through ~~Everest Re's~~ branches in Canada ~~Singapore~~ and ~~through offices in Brazil, Miami and New Jersey.~~Singapore. The Insurance operation writes property and casualty insurance directly and through brokers, surplus lines brokers and general agents ~~mainly~~ within the ~~U.S.~~

United States.

These segments are managed independently, but conform with corporate guidelines with respect to pricing, risk management, control of aggregate catastrophe exposures, capital, investments and support operations. Management generally monitors and evaluates the financial performance of these operating segments based upon their underwriting results.

Underwriting results include earned premium less losses and ~~loss adjustment expenses ("LAE")~~LAE incurred, commission and brokerage expenses and other underwriting expenses. ~~We measure our~~The Company measures its underwriting results using ratios, in particular loss, commission and brokerage and other underwriting expense ratios, which, respectively, divide incurred losses, commissions and brokerage and other underwriting expenses by premiums earned.

The Company does not maintain separate balance sheet data for its operating segments. Accordingly, the Company does not review and evaluate the financial results of its operating segments based upon balance sheet data.

The following tables present the underwriting results for the operating segments for the periods indicated:

	Three Months Ended				Nine Months Ended
Reinsurance	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Gross written premiums	$	1,693,027	$	1,473,266	$	4,552,364	$	3,906,355
Net written premiums		1,461,238		1,296,107		3,961,280		3,403,090

Premiums earned	$	1,280,181	$	1,153,740	$	3,689,508	$	3,223,608
Incurred losses and LAE		1,207,528		936,904		2,917,285		2,250,270
Commission and brokerage		319,707		265,095		935,252		818,282
Other underwriting expenses		32,049		35,697		101,337		92,143
Underwriting gain (loss)	$	(279,103)	$	(83,956)	$	(264,366)	$	62,913

Three Months Ended Nine Months Ended
U.S. Reinsurance
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Gross written premiums $ 908,346 $ 654,770 $ 1,962,297 $ 1,597,006
Net written premiums 295,645 327,242 649,883 711,700

Premiums earned $ 242,350 $ 249,203 $ 652,953 $ 709,064
Incurred losses and LAE 678,926 137,245 919,107 363,567
Commission and brokerage 31,698 48,107 115,243 147,968
Other underwriting expenses 12,094 14,265 40,623 39,856
Underwriting gain (loss) $ (480,368 ) $ 49,586 $ (422,020 ) $ 157,673

Three Months Ended Nine Months Ended
International
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Gross written premiums $ 363,186 $ 353,195 $ 975,296 $ 939,851
Net written premiums 130,180 141,295 345,387 353,449

Premiums earned $ 123,915 $ 128,358 $ 355,366 $ 372,816
Incurred losses and LAE 410,543 41,830 557,416 206,672
Commission and brokerage 25,101 30,193 72,426 82,443
Other underwriting expenses 8,241 9,219 26,293 25,011
Underwriting gain (loss) $ (319,970 ) $ 47,116 $ (300,769 ) $ 58,690

Three Months Ended Nine Months Ended
Insurance
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Gross written premiums $ 429,593 $ 497,958 $ 1,351,491 $ 1,276,761
Net written premiums 144,935 154,079 442,237 462,791

Premiums earned $ 152,242 $ 179,092 $ 449,440 $ 445,553
Incurred losses and LAE 242,089 122,528 441,985 365,962
Commission and brokerage (22,254 ) 4,478 (40,104 ) (10,859 )
Other underwriting expenses 37,378 40,665 114,889 116,839
Underwriting gain (loss) $ (104,971 ) $ 11,421 $ (67,330 ) $ (26,389 )

	Three Months Ended				Nine Months Ended
Insurance	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Gross written premiums	$	830,688	$	591,695	$	2,421,716	$	1,971,818
Net written premiums		608,248		429,594		1,801,884		1,462,869

Premiums earned	$	571,183	$	461,717	$	1,625,311	$	1,424,814
Incurred losses and LAE		445,491		340,947		1,185,435		1,032,926
Commission and brokerage		69,139		57,309		190,296		182,925
Other underwriting expenses		77,464		73,669		227,901		212,562
Underwriting gain (loss)	$	(20,911)	$	(10,208)	$	21,678	$	(3,599)

The following table reconciles the underwriting results for the operating segments to income (loss) before taxes as reported in the consolidated statements of operations and comprehensive income (loss) for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Underwriting gain (loss)	$	(300,014)	$	(94,164)	$	(242,688)	$	59,314
Net investment income		197,161		135,428		593,019		244,782
Net realized capital gains (losses)		(51,451)		115,193		267,323		(107,300)
Corporate expense		(10,907)		(4,206)		(23,106)		(11,441)
Interest, fee and bond issue cost amortization expense		(15,539)		(6,535)		(46,610)		(20,917)
Other income (expense)		9,937		(1,790)		12,049		(11,410)
Income (loss) before taxes	$	(170,813)	$	143,926	$	559,986	$	153,028

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Underwriting gain (loss) $ (905,309 ) $ 108,123 $ (790,119 ) $ 189,974
Net investment income 73,417 64,570 206,166 196,887
Net realized capital gains (losses) 228,489 (50,063 ) 253,966 (87,275 )
Corporate expense (1,132 ) (1,835 ) (6,241 ) (6,181 )
Interest, fee and bond issue cost amortization expense (7,161 ) (8,859 ) (23,974 ) (26,576 )
Other income (expense) 1,486 (13,208 ) 21,996 (10,806 )
Income (loss) before taxes $ (610,210 ) $ 98,728 $ (338,206 ) $ 256,023

The Company produces business in the U.S. and internationally. The net income deriving from assets residing in the individual foreign countries in which the Company writes business are not identifiable in the ~~Company's~~Company’s financial records. Based on gross written premium, the table below presents the largest country, other than the U.S., in which the Company writes business, for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Canada gross written premiums	$	60,455	$	65,785	$	163,740	$	200,443

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Canada gross written premiums $ 30,625 $ 35,856 $ 94,777 $ 94,072

No other country represented more than 5% of the ~~Company's~~Company’s revenues.

13. RELATED-PARTY TRANSACTIONS

Parent

Group entered into a ~~$250,000 thousand~~$300.0 million long term ~~promissory~~ note agreement with ~~Holdings~~Everest Re as of December ~~31, 2014.~~17, 2019. The note will ~~mature on December 31, 2023 and has an~~pay interest annually at a rate of ~~1.72% that~~1.69% and is ~~payable annually. This transaction is presented as a Note Receivable – Affiliated~~scheduled to mature in December, 2028. The Company recognized interest income related to this long term note of $1.3 million and $1.3 million for the ~~Consolidated Balance Sheets of Holdings. Interest income in the amount of $3,225 thousand~~three months ended September 30, 2021 and ~~$3,225 thousand was recorded by Holdings~~2020, respectively and $3.8 million and $3.9 million for the nine months ended September 30, ~~2017,~~2021 and 2020, respectively.

Group entered into a $200.0 million long term note agreement with Everest Re as of August 5, 2021. The note will pay interest annually at a rate of 1.00% and is scheduled to mature in August, 2030. The Company recognized interest income related to this long term note of $0.3 million for both the three and nine months ended September 30, ~~2016, respectively.~~2021.

~~Group's~~

Group’s Board of Directors approved an amended share repurchase program authorizing Group and/or its subsidiary Holdings to purchase ~~Group's~~Group’s common shares through open market transactions, privately negotiated transactions or both. The ~~table below represents~~most recent amendment from the ~~amendments~~Board, approved on May 22, 2020, increased the cumulative number of shares that may be repurchased under the program to ~~the share repurchase program for the common shares approved for repurchase.~~32.0 million shares.

		~~Common Shares~~
		~~Authorized for~~
~~Amendment Date~~		~~Repurchase~~
~~(Dollars in thousands)~~

~~09/21/2004~~		~~5,000,000~~
~~07/21/2008~~		~~5,000,000~~
~~02/24/2010~~		~~5,000,000~~
~~02/22/2012~~		~~5,000,000~~
~~05/15/2013~~		~~5,000,000~~
~~11/19/2014~~		~~5,000,000~~
		~~30,000,000~~

Holdings had purchased and held 9,719,971 Common Shares of Group, which were purchased in the open market between February 2007 and March 2011.

In December, 2015, Holdings transferred the 9,719,971 Common Shares of Group, which it held as other invested assets, at fair value, valued at ~~$1,773,214 thousand,~~$1,773.2 million, to Preferred Holdings ~~an affiliated entity and subsidiary of Group,~~ in exchange for 1,773.214 preferred shares of Preferred Holdings with a ~~$1,000 thousand~~$1.0 million par value and 1.75% annual dividend rate. After the exchange, Holdings no longer holds any shares or has any ownership interest in Group.

Holdings has reported ~~both its Parent shares and~~the preferred shares in Preferred Holdings, as other invested assets, fair value, in the consolidated balance sheets with changes in fair value re-measurement recorded in net realized capital gains (losses) in the consolidated statements of operations and comprehensive income (loss). The following table presents the dividends received on the preferred shares of Preferred Holdings and on the Parent shares that are reported as net investment income in the consolidated statements of operations and comprehensive income (loss) for the period indicated.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Dividends received on preferred stock of affiliate	$	7,758	$	7,758	$	23,274	$	23,274

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Dividends received on preferred stock of affiliate $ 7,758 $ 7,758 $ 23,274 $ 23,274

~~Affiliated Companies~~

Affiliates

The Company has engaged in reinsurance transactions with Bermuda Re, Everest ~~Global Services, Inc. ("Global Services"~~Reinsurance Company (Ireland) dac (“Ireland Re”), ~~an affiliate~~Everest Insurance (Ireland) dac (“Ireland Insurance”), Everest International Reinsurance Ltd. (“Everest International”), Everest Insurance Company of ~~Holdings, provides centralized management~~Canada (“Everest Canada”), Lloyd’s Syndicate 2786 and ~~home office services, through a management agreement, to Holdings and other~~Mt. Logan Re, which are affiliated companies ~~within Holdings' consolidated structure. Services provided~~primarily driven by ~~Everest Global include executive managerial services, legal services, actuarial services, accounting services, information technology services~~enterprise risk and ~~others.~~

~~The following table presents the expenses incurred by Holdings from services provided by Everest Global for the periods indicated.~~

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Expenses incurred $ 25,465 $ 21,242 $ 71,694 $ 62,701

~~Affiliates~~

capital management considerations under which business is ceded at market rates and terms.

The table below represents affiliated quota share reinsurance agreements ("whole account quota share") for all new and renewal business for the indicated coverage period:

(Dollars in thousands)
							Single
			Percent		Assuming		Occurrence		Aggregate
Coverage Period		Ceding Company	Ceded		Company	Type of Business	Limit		Limit
01/01/2010-12/31/2010		Everest Re	44.0	%	Bermuda Re	property / casualty business	150,000		325,000
01/01/2011-12/31/2011		Everest Re	50.0	%	Bermuda Re	property / casualty business	150,000		300,000
01/01/2012-12/31/2014		Everest Re	50.0	%	Bermuda Re	property / casualty business	100,000		200,000
01/01/2015-12/31/2016		Everest Re	50.0	%	Bermuda Re	property / casualty business	162,500		325,000
01/01/2017-12/31/2017		Everest Re	60.0	%	Bermuda Re	property / casualty business	219,000		438,000
01/01/2010-12/31/2010		Everest Re- Canadian Branch	60.0	%	Bermuda Re	property business	350,000	⁽¹⁾	-
01/01/2011-12/31/2011		Everest Re- Canadian Branch	60.0	%	Bermuda Re	property business	350,000	⁽¹⁾	-
01/01/2012-12/31/2012		Everest Re- Canadian Branch	75.0	%	Bermuda Re	property / casualty business	206,250	⁽¹⁾	412,500	⁽¹⁾
01/01/2013-12/31/2013		Everest Re- Canadian Branch	75.0	%	Bermuda Re	property / casualty business	150,000	⁽¹⁾	412,500	⁽¹⁾
01/01/2014-12/31/2017		Everest Re- Canadian Branch	75.0	%	Bermuda Re	property / casualty business	262,500	⁽¹⁾	412,500	⁽¹⁾
01/01/2012-12/31/2017		Everest Canada	80.0	%	Everest Re- Canadian Branch	property business	-		-
01/01/2020		Everest International Assurance	100.0	%	Bermuda Re	life business	-		-

(1)	Amounts shown are Canadian dollars.

Effective January 1, 2018, Everest Re entered into a twelve month whole account aggregate stop loss reinsurance contract (“stop loss agreement”) with Bermuda Re. The stop loss agreement provides coverage for ultimate net

(Dollars in thousands)
Percent Assuming Single Aggregate
Coverage Period Ceding Company Ceded Company Type of Business Occurrence Limit Limit

01/01/2010-12/31/2010 Everest Re 44.0% Bermuda Re property / casualty business 150,000 325,000

01/01/2011-12/31/2011 Everest Re 50.0% Bermuda Re property / casualty business 150,000 300,000

01/01/2012-12/31/2014 Everest Re 50.0% Bermuda Re property / casualty business 100,000 200,000

01/01/2015-12/31/2016 Everest Re 50.0% Bermuda Re property / casualty business 162,500 325,000

01/01/2017 Everest Re 60.0% Bermuda Re property / casualty business 219,000 438,000

01/01/2010-12/31/2010 Everest Re- Canadian Branch 60.0% Bermuda Re property business 350,000
⁽¹⁾
-
01/01/2011-12/31/2011 Everest Re- Canadian Branch 60.0% Bermuda Re property business 350,000
⁽¹⁾
-
01/01/2012-12/31/2012 Everest Re- Canadian Branch 75.0% Bermuda Re property / casualty business 206,250
⁽¹⁾
412,500
⁽¹⁾
01/01/2013-12/31/2013 Everest Re- Canadian Branch 75.0% Bermuda Re property / casualty business 150,000
⁽¹⁾
412,500
⁽¹⁾
01/01/2014 Everest Re- Canadian Branch 75.0% Bermuda Re property / casualty business 262,500
⁽¹⁾
412,500
⁽¹⁾

01/01/2012 Everest Canada 80.0% Everest Re- Canadian Branch property business - -

⁽¹⁾Amounts shown are Canadian dollars.

losses on applicable net earned premiums above a retention level, subject to certain other coverage limits and conditions. The stop loss agreement was most recently renewed effective January 1, 2021.

Everest Re entered into a property catastrophe excess of loss reinsurance contract with Bermuda Re, effective January 1, 2019. The contract provides $100.0 million of reinsurance coverage for property catastrophe losses above certain attachment points. This agreement expired on December 31, 2019 and was not renewed.

Everest Re entered into a catastrophe excess of loss reinsurance contract with Bermuda Re (UK Branch), effective January 1, 2021 through December 31, 2021, subject to renewal thereafter. The contract provides Bermuda Re (UK Branch), with up to £100.0 million of reinsurance coverage for each catastrophe occurrence above £40.0 million. Bermuda Re (UK Branch) paid Everest Re £3.5 million for this coverage.

Everest Re entered into a catastrophe excess of loss reinsurance contract with Ireland Re, effective February 1, 2021 through January 31, 2022, subject to renewal thereafter. The contract provides Ireland Re with up to €145.0 million of reinsurance coverage for each catastrophe occurrence above €16.0 million. Ireland Re paid Everest Re €9.8 million for this coverage.

The table below represents loss portfolio transfer (“LPT”) reinsurance agreements whereby net insurance exposures and reserves were transferred to an affiliate.

(Dollars in thousands)
Effective	Transferring	Assuming		% of Business or		Covered Period
Date	Company	Company		Amount of Transfer		of Transfer
10/01/2001	Everest Re (Belgium Branch)	Bermuda Re		100	%	All years
10/01/2008	Everest Re	Bermuda Re	$	747,022		01/01/2002-12/31/2007
12/31/2017	Everest Re	Bermuda Re	$	970,000		All years

Effective Transferring Assuming % of Business or Covered Period
Date Company Company Amount of Transfer of Transfer

09/19/2000 Mt. McKinley Bermuda Re 100 % All years
10/01/2001 Everest Re (Belgium Branch) Bermuda Re 100 % All years
10/01/2008 Everest Re Bermuda Re $ 747,022 01/01/2002-12/31/2007

On ~~July 13, 2015,~~December 31, 2017, the Company ~~sold Mt. McKinley~~entered into a LPT agreement with Bermuda Re. The LPT agreement covers subject loss reserves of $2,336.2 million for accident years 2017 and prior. As a result of the LPT agreement, the Company transferred $1,000.0 million of cash and fixed maturity securities and transferred $970.0 million of loss reserves to ~~Clearwater Insurance Company, a Delaware domiciled insurance company.~~Bermuda Re. As part of the LPT agreement, Bermuda Re will provide an additional $500.0 million of adverse development coverage on the subject loss reserves. As of ~~that date, Mt. McKinley is no longer deemed an affiliated company or related party.~~

September 30,

2021, and December 31, 2020, the Company has a reinsurance recoverable of $882.7 million and $886.4 million, respectively, recorded on its balance sheet due from Bermuda Re.

The following tables summarize the premiums and losses ceded by the Company to Bermuda Re and Everest International, respectively, and premiums and losses assumed by the Company from Everest Canada, Everest Ireland and ~~Lloyd's~~Lloyd’s syndicate 2786 for the periods indicated:

	Three Months Ended				Nine Months Ended
Bermuda Re	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Ceded written premiums	$	78,330	$	32,255	$	224,131	$	96,353
Ceded earned premiums		77,078		32,278		221,754		95,215
Ceded losses and LAE		12,355		12,605		3,241		4,263

Assumed written premiums		4,820		-		4,820		-
Assumed earned premiums		3,676		62		3,799		186
Assumed losses and LAE		(199)		62		(134)		115

Three Months Ended Nine Months Ended
Bermuda Re
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Ceded written premiums $ 911,866 $ 685,798 $ 2,228,538 $ 1,746,976
Ceded earned premiums 796,194 585,993 2,005,965 1,718,295
Ceded losses and LAE (a) 650,460 344,789 1,379,164 1,039,932

Three Months Ended Nine Months Ended
Everest International
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Ceded written premiums $ 21 $ (5 ) $ (4 ) $ 26
Ceded earned premiums 38 (3 ) 13 36
Ceded losses and LAE (13 ) 479 (631 ) 1,377

Three Months Ended Nine Months Ended
Everest Canada
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Assumed written premiums $ 13,028 $ 12,667 $ 39,008 $ 39,094
Assumed earned premiums 13,464 11,611 38,201 34,740
Assumed losses and LAE 7,448 13,287 21,418 34,714

Three Months Ended Nine Months Ended
Lloyd's Syndicate 2786
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Assumed written premiums $ 15,984 $ 351 $ 34,069 $ 890
Assumed earned premiums 15,042 173 31,766 289
Assumed losses and LAE 7,893 - 16,157 -

Everest Re sold net assets of its UK branch to Bermuda Re and provided Bermuda Re with a reserve indemnity agreement allowing for indemnity payments of up to 90% of ₤25.0 million of the excess of 2002 and prior reserves, provided that any recognition of profit from the reserves for 2002 and prior underwriting years is taken into account.

	Three Months Ended				Nine Months Ended
Ireland Re	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Assumed written premiums	$	7,092	$	-	$	12,993	$	-
Assumed earned premiums		7,092		-		12,018		-
Assumed losses and LAE		62,472		-		62,472		-

	Three Months Ended				Nine Months Ended
Ireland Insurance	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Assumed written premiums	$	3,619	$	1,217	$	6,409	$	3,723
Assumed earned premiums		1,724		788		4,237		2,569
Assumed losses and LAE		1,134		704		2,139		1,625

	Three Months Ended				Nine Months Ended
Lloyd's Syndicate 2786	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Assumed written premiums	$	56	$	(1,743)	$	728	$	(4,144)
Assumed earned premiums		81		(1,743)		722		(3,926)
Assumed losses and LAE		(473)		293		(259)		(331)

	Three Months Ended				Nine Months Ended
Everest International & Canada	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Ceded written premiums	$	-	$	-	$	-	$	-
Ceded earned premiums		-		-		-		-
Ceded losses and LAE		-		-		-		16

Assumed written premiums		-		-		-		1
Assumed earned premiums		-		-		-		(7)
Assumed losses and LAE		46		(1,709)		112		(1,059)

Effective February 27, 2013, Group established a new subsidiary, Mt. Logan Re, which is a Class 3 insurer based in Bermuda. Effective July 1, 2013, Mt. Logan Re established separate segregated accounts for its business activity, which will invest in a diversified set of catastrophe exposures.

The following table summarizes the premiums and losses that are ceded by the Company to Mt. Logan Re segregated accounts and assumed by the Company from Mt. Logan Re segregated accounts.

	Three Months Ended				Nine Months Ended
Mt. Logan Re Segregated Accounts	September 30,				September 30,
(Dollars in thousands)	2021		2020		2021		2020
Ceded written premiums	$	97,649	$	74,215	$	225,592	$	211,429
Ceded earned premiums		86,049		62,543		212,153		202,810
Ceded losses and LAE		97,070		68,879		191,677		143,179

Three Months Ended Nine Months Ended
Mt. Logan Re Segregated Accounts
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Ceded written premiums $ 54,057 $ 57,911 $ 131,939 $ 128,292
Ceded earned premiums 46,696 44,548 131,361 118,776
Ceded losses and LAE 180,540 7,420 223,973 32,750

Assumed written premiums $ 2,587 $ 5,032 $ 9,082 $ 11,666
Assumed earned premiums 2,587 5,032 9,082 11,666
Assumed losses and LAE - - - -

14.~~RETIREMENT BENEFITS~~

~~The Company maintains both qualified and non-qualified defined benefit pension plans and a retiree health plan for its U.S. employees employed prior to April 1, 2010.~~

~~Net periodic benefit cost for U.S. employees included the following components for the periods indicated:~~

Pension Benefits
Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Service cost $ 2,737 $ 2,731 $ 9,335 $ 8,524
Interest cost 2,509 2,371 7,060 7,093
Expected return on plan assets (3,263 ) (2,789 ) (9,572 ) (7,757 )
Amortization of net (income) loss 2,091 1,984 8,172 6,012
Net periodic benefit cost $ 4,074 $ 4,297 $ 14,995 $ 13,872

Other Benefits
Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in thousands) 2017 2016 2017 2016
Service cost $ 392 $ 354 $ 1,273 $ 1,230
Interest cost 295 252 793 844
Amortization of prior service cost (33 ) (33 ) (98 ) (33 )
Amortization of net (income) loss 48 - 199 96
Net periodic benefit cost $ 703 $ 573 $ 2,167 $ 2,137

(Some amounts may not reconcile due to rounding.)

The Company contributed $10,000 thousand to the qualified pension benefit plan for the three and nine months ended September 30, 2017. The Company contributed $30,000 thousand to the qualified pension benefit plan for the three and nine months ended September 30, 2016.

~~15.~~ INCOME TAXES

The Company is domiciled in the United States and has subsidiaries domiciled within the United States with significant branches in Canada and Singapore. The ~~Company's~~Company’s non-U.S. branches are subject to income taxation at varying rates in their respective domiciles.

The Company generally applies the estimated annual effective tax rate approach for calculating its tax provision for interim periods as prescribed by ASC 740-270, Interim Reporting. Under the estimated annual effective tax rate approach, the estimated annual effective tax rate is applied to the interim year-to-date pre-tax income/~~loss~~ (loss)to determine the income tax expense or benefit for the year-to-date period. If the annual effective tax rate approach produces a year-to-date tax benefit which exceeds the amount which is estimated to be recoverable for the full year, then the tax benefit for the interim reporting period will be limited as

~~prescribed under ASC 740-270 to the estimated recoverable based on the year-to-date result.~~ The tax expense or benefit for the quarter represents the difference between the year-to-date tax expense or benefit for the current

year-to-date period less such amount for the immediately preceding year-to-date period. Management considers the impact of all known events in its estimation of the ~~Company's~~Company’s annual pre-tax income/~~loss~~(loss) and effective tax rate.

~~16. DISPOSITION~~

On August 24, 2016 the Company sold Heartland, its crop Managing General Agent to CGB for $49,000 thousand. The sale agreement includes a provision for a long term strategic reinsurance relationship with CGB. The Company has recognized an after-tax loss on the sale of Heartland of $12,942 thousand. Under the terms of the reinsurance arrangement, there has not been a material fluctuation in the level of crop business, although it has been reflected as reinsurance rather than insurance.

~~17.~~

15. SUBSEQUENT EVENTS

The Company has evaluated known recognized and non-recognized subsequent events. InOther than the debt issuance on October ~~2017, Hurricane Nate impacted the Southern United States and Central America and Hurricane Ophelia impacted Ireland, the United Kingdom and Northern Europe. Also,~~4, 2021, described in ~~October 2017, a number of wildfires affected California. Due to the recentness of these events,~~Note 9, the Company ~~is unable~~does not have any subsequent events to estimate the amount of losses related to Hurricane Nate, Hurricane Ophelia or the California wildfires at this time. However, the Company anticipates that these events will adversely impact the fourth quarter 2017 financial results.report.

ITEM 2.~~MANAGEMENT'S~~ MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

Industry Conditions.

The worldwide reinsurance and insurance businesses are highly competitive, as well as cyclical by product and market. As such, financial results tend to fluctuate with periods of constrained availability, higher rates and stronger profits followed by periods of abundant capacity, lower rates and constrained profitability. Competition in the types of reinsurance and insurance business that we underwrite is based on many factors, including the perceived overall financial strength of the reinsurer or insurer, ratings of the reinsurer or insurer by A.M. Best and/or Standard & ~~Poor's,~~Poor’s, underwriting expertise, the jurisdictions where the reinsurer or insurer is licensed or otherwise authorized, capacity and coverages offered, premiums charged, other terms and conditions of the reinsurance and insurance business offered, services offered, speed of claims payment and reputation and experience in lines written. Furthermore, the market impact from these competitive factors related to reinsurance and insurance is generally not consistent across lines of business, domestic and international geographical areas and distribution channels.

We compete in the U.S. and international reinsurance and insurance markets with numerous global competitors. Our competitors include independent reinsurance and insurance companies, subsidiaries or affiliates of established worldwide insurance companies, reinsurance departments of certain insurance companies, domestic and international underwriting operations, ~~including underwriting syndicates at Lloyd's of London~~ and certain government sponsored risk transfer vehicles. Some of these competitors have greater financial resources than we do and have established long term and continuing business relationships, which can be a significant competitive advantage. In addition, the lack of strong barriers to entry into the reinsurance business and recently, the securitization of reinsurance and insurance risks through capital markets provide additional sources of potential reinsurance and insurance capacity and competition.

Worldwide insurance and reinsurance market conditions ~~continued to be very competitive, particularly in the property catastrophe and casualty reinsurance lines of business.~~historically have been competitive. Generally, there was ample insurance and reinsurance capacity relative to demand, as well as, additional capital from the capital markets through insurance linked financial instruments. These financial instruments such as side cars, catastrophe bonds and collateralized reinsurance funds, ~~provide~~provided capital markets with access to insurance and reinsurance risk exposure. The capital markets demand for these products iswas being primarily driven by ~~the current~~a low interest ~~rate~~ environment and the desire to achieve greater risk diversification and potentially higher returns on their investments. This increased competition iswas generally having a negative impact on rates, terms and conditions; however, the impact varies widely by market and coverage.

~~Rates tend~~

The industry continues to ~~fluctuate by specific region~~deal with the impacts of a global pandemic, COVID-19 and ~~products, particularly areas recently impacted by large catastrophic events.~~ its subsequent variants. Globally, many countries mandated that their citizens remain at home and many non-essential businesses have continued to be physically closed. We activated our operational resiliency plan across our global footprint and all of our critical operations are functioning effectively from remote locations. We continue to service and meet the needs of our clients while ensuring the safety and health of our employees and customers.

There ~~was an unprecedented series~~continues to be a negative impact on industry underwriting results from the pandemic. These impacts vary significantly from country to country depending on the rate of catastrophes in the third quarter of 2017 with Hurricanes Harvey, Irma and Maria, as well as a significant earthquake in Mexico City. Additional catastrophe events occurred in October 2017 with Hurricanes Nate and Opheliainfections and the ~~wild fires in California. The total industry losses for all of these events could exceed $100 billion. This is~~corresponding mandated business restrictions.

Prior to the second consecutive year with higher than average catastrophe losses. During 2016, catastrophe losses included the Fort McMurray Canadian wildfire, Hurricane Matthew which affected a large area of the Caribbean and southeastern United States, storms and an earthquake in Ecuador. There are industry reports that the catastrophe losses for 2016 reached their highest level in four years and the United States experienced the most loss events since 1980 and the highest total losses since 2012. While the future impact on market conditions from these catastrophes cannot be determined at this time,pandemic, there was ~~some firming in the markets impacted by the 2016 catastrophes and as catastrophe losses continue to increase in 2017, there is~~ a growing industry consensus that there ~~will be a general~~was some firming of ~~the~~ (re)insurance ~~markets resulting~~rates for the areas impacted by the recent catastrophes. The increased frequency of catastrophe losses in ~~rate increases, not only for catastrophe exposures, but~~2020 and 2021 appears to be further pressuring the increase of rates. As business activity continues to regain strength, rates also ~~potentially for~~appear to be firming in most ~~other lines of business.~~

Commencing in 2015, we initiated a strategic build out of our insurance platform through the investment in key leadership hires which in turn has brought significant underwriting talent and stronger direction in achieving our insurance program strategic goals of increased premium volume and improved underwriting results. Recent growth is coming from highly diversified areas including newly launched lines of business, particularly in the casualty lines that had seen significant losses such as excess casualty and directors’ and officers’ liability. Other casualty lines are experiencing modest rate increase, while some lines such as workers’ compensation were experiencing softer market conditions. It is too early to tell what will be the impact on pricing conditions but it is likely to change depending on the line of business and geography.

While we are unable to predict the full impact the pandemic will have on the insurance industry as it continues to have a negative impact on the global economy, we are well ~~as, product and geographic expansion in existing lines of business. We are building a world-class~~

~~insurance platform capable of offering products across lines and geographies, complementing our leading global reinsurance franchise.~~

Overall, we believe that given our size, strong ratings, distribution system, reputation, expertise and capital market vehicle activity the current marketplace conditions provide profit opportunities. Wepositioned to continue to ~~employ~~service our ~~strategy~~clients. Our capital position remains a source of ~~targeting business that offers the greatest profit potential, while maintaining balance~~strength, with high quality invested assets, significant liquidity and ~~diversification in our overall portfolio.~~a low operating expense ratio. Our diversified global platform with its broad mix of products, distribution and geography is resilient.

Financial Summary.

We monitor and evaluate our overall performance based upon financial results. The following table displays a summary of the consolidated net income (loss), ratios and ~~stockholder's~~stockholder’s equity for the periods indicated:

	Three Months Ended				Percentage	Nine Months Ended				Percentage
	September 30,				Increase/	September 30,				Increase/
(Dollars in millions)	2021		2020		(Decrease)	2021		2020		(Decrease)
Gross written premiums	$	2,523.7	$	2,065.0	22.2%	$	6,974.1	$	5,878.2	18.6%
Net written premiums		2,069.5		1,725.7	19.9%		5,763.2		4,866.0	18.4%

REVENUES:
Premiums earned	$	1,851.3	$	1,615.5	14.6%	$	5,314.8	$	4,648.4	14.3%
Net investment income		197.1		135.4	45.6%		593.0		244.8	142.3%
Net realized capital gains (losses)		(51.5)		115.2	-144.7%		267.3		(107.3)	NM
Other income (expense)		9.9		(1.8)	NM		12.0		(11.4)	NM
Total revenues		2,007.0		1,864.3	7.7%		6,187.2		4,774.5	29.6%

CLAIMS AND EXPENSES:
Incurred losses and loss adjustment expenses		1,653.0		1,277.9	29.4%		4,102.7		3,283.2	25.0%
Commission, brokerage, taxes and fees		388.8		322.4	20.6%		1,125.5		1,001.2	12.4%
Other underwriting expenses		109.5		109.4	0.1%		329.2		304.7	8.1%
Corporate expense		10.9		4.2	159.3%		23.1		11.4	102.0%
Interest, fee and bond issue cost amortization expense		15.5		6.5	137.8%		46.6		20.9	122.8%
Total claims and expenses		2,177.8		1,720.4	26.6%		5,627.2		4,621.5	21.8%

INCOME (LOSS) BEFORE TAXES		(170.8)		143.9	NM		560.0		153.0	NM
Income tax expense (benefit)		(27.5)		24.1	NM		118.1		(12.8)	NM
NET INCOME (LOSS)	$	(143.3)	$	119.8	NM	$	441.9	$	165.9	166.5%

RATIOS:					Point Change					Point Change
Loss ratio		89.3%		79.1%	10.2		77.2%		70.6%	6.6
Commission and brokerage ratio		21.0%		20.0%	1.0		21.2%		21.5%	(0.3)
Other underwriting expense ratio		5.9%		6.7%	(0.8)		6.2%		6.6%	(0.4)
Combined ratio		116.2%		105.8%	10.4		104.6%		98.7%	5.9

	At		At		Percentage
	September 30,		December 31,		Increase/
(Dollars in millions)	2021		2020		(Decrease)
Balance sheet data:
Total investments and cash	$	17,936.7	$	15,910.2	12.7%
Total assets		26,336.2		23,717.1	11.0%
Loss and loss adjustment expense reserves		13,321.8		11,655.0	14.3%
Total debt		1,910.9		1,910.4	0.0%
Total liabilities		19,578.4		17,302.8	13.2%
Stockholder's equity		6,757.8		6,414.3	5.4%

(Some amounts may not reconcile due to rounding)
(NM, not meaningful)

Three Months Ended Percentage Nine Months Ended Percentage
September 30, Increase/ September 30, Increase/
(Dollars in millions) 2017 2016 (Decrease) 2017 2016 (Decrease)
Gross written premiums $ 1,701.1 $ 1,505.9 13.0 % $ 4,289.1 $ 3,813.6 12.5 %
Net written premiums 570.8 622.6 -8.3 % 1,437.5 1,527.9 -5.9 %

REVENUES:
Premiums earned $ 518.5 $ 556.7 -6.9 % $ 1,457.8 $ 1,527.4 -4.6 %
Net investment income 73.4 64.6 13.7 % 206.2 196.9 4.7 %
Net realized capital gains (losses) 228.5 (50.1 )
NM
254.0 (87.3 )
NM
Other income (expense) 1.5 (13.2 ) -111.3 % 22.0 (10.8 ) NM
Total revenues 821.9 558.0 47.3 % 1,939.9 1,626.2 19.3 %

CLAIMS AND EXPENSES:
Incurred losses and loss adjustment expenses 1,331.6 301.6 NM 1,918.5 936.2 104.9 %
Commission, brokerage, taxes and fees 34.5 82.8 -58.3 % 147.6 219.6 -32.8 %
Other underwriting expenses 57.7 64.1 -10.0 % 181.8 181.7 0.1 %
Corporate expense 1.1 1.8 -38.3 % 6.2 6.2 1.0 %
Interest, fee and bond issue cost amortization expense 7.2 8.9 -19.2 % 24.0 26.6 -9.8 %
Total claims and expenses 1,432.1 459.2 211.9 % 2,278.1 1,370.2 66.3 %

INCOME (LOSS) BEFORE TAXES (610.2 ) 98.7
NM
(338.2 ) 256.0 -232.1 %
Income tax expense (benefit) (220.5 ) 22.4 NM (153.3 ) 69.4 NM
NET INCOME (LOSS) $ (389.7 ) $ 76.3
NM
$ (184.9 ) $ 186.7 -199.0 %

RATIOS: Point Change Point Change
Loss ratio 256.8 % 54.2 % 202.6 131.6 % 61.3 % 70.3
Commission and brokerage ratio 6.7 % 14.9 % (8.2 ) 10.1 % 14.4 % (4.3 )
Other underwriting expense ratio 11.1 % 11.5 % (0.4 ) 12.5 % 11.9 % 0.6
Combined ratio 274.6 % 80.6 % 194.0 154.2 % 87.6 % 66.6

At At Percentage
September 30, December 31, Increase/
(Dollars in millions) 2017 2016 (Decrease)
Balance sheet data:
Total investments and cash $ 10,231.7 $ 9,842.7 4.0 %
Total assets 19,143.4 17,083.4 12.1 %
Loss and loss adjustment expense reserves 9,969.1 8,331.3 19.7 %
Total debt 633.3 633.2 0.0 %
Total liabilities 13,975.7 11,784.9 18.6 %
Stockholder's equity 5,167.6 5,298.6 -2.5 %

(Some amounts may not reconcile due to rounding)
(NM, not meaningful)

Revenues.

Premiums. Gross written premiums increased by ~~13.0%~~22.2% to ~~$1,701.1~~$2,523.7 million for the three months ended September 30, ~~2017,~~2021, compared to ~~$1,505.9~~$2,065.0 million for the three months ended September 30, ~~2016,~~2020, reflecting a ~~$263.6~~$219.8 million, or ~~26.1%~~14,9%, increase in our reinsurance business and a ~~$68.4~~$239.0 million, or 13.7%, decrease in our insurance business. The increase in reinsurance premiums was mainly due to the new crop reinsurance transactions, increases in financial lines of business and the influx of reinstatement premiums related to multiple catastrophe events in the third quarter. The decline in insurance premiums was due to the sale of Heartland Crop Insurance, Inc. ("Heartland") which accounted for $162.4 million of gross written premium in the third quarter of 2016. Excluding the impact of Heartland, insurance premiums rose by $94.0 million due to increased production in many lines of business, including retail casualty, surety and accident and health. Gross written premiums increased by 12.5% to $4,289.1 million for the nine months ended ~~September~~ ~~30, 2017, compared to $3,813.6 million for the nine months ended~~ ~~September~~ ~~30, 2016, reflecting a $400.7 million, or 15.8%, increase in our reinsurance business and a $74.7 million, or 5.9%~~40.4%, increase in our insurance business. The increase in reinsurance premiums was mainly due to ~~the new crop reinsurance transactions,~~ increases in ~~treaty property and financial lines~~casualty pro rata business, casualty excess of loss business and ~~the influx~~property catastrophe excess of ~~reinstatement premiums related to multiple catastrophe events in the third quarter.~~loss writings. The rise in insurance premiums was primarily due to increases in ~~many lines of~~specialty casualty business, professional liability business and short tail business, including ~~retail~~property. Gross written premiums increased by 18.6% to $6,974.1 million for the nine months ended September 30, 2021, compared to $5,878.2 million for the nine months ended September 30, 2020, reflecting a $646.0 million, or 16.5%, increase in our reinsurance business and a $449.9 million, or 22.8%, increase in our insurance business. The increase in reinsurance premiums was mainly due to increases in casualty ~~accident~~pro rata business, casualty excess of loss business and ~~health~~property catastrophe excess of loss writings. The rise in insurance premiums was primarily due to increases in specialty casualty business, professional liability business and ~~surety,~~short tail business, including property, partially offset by ~~the impact of the sale of Heartland.~~

a decline in workers’ compensation business.

Net written premiums ~~decreased~~increased by ~~8.3%~~19.9% to ~~$570.8~~$2,069.5 million for the three months ended September 30, ~~2017,~~2021, compared to ~~$622.6~~$1,725.7 million for the three months ended September 30, ~~2016,~~2020 and ~~decreased~~increased by ~~5.9%~~18.4% to ~~$1,437.5~~$5,763.2 million for the nine months ended September 30, ~~2017,~~2021, compared to ~~$1,527.9~~$4,866.0 million for the nine months ended September 30, ~~2016. The difference between~~2020, which is consistent with the change in gross written ~~premiums compared to the change in net written premiums is primarily due to varying utilization of reinsurance mainly related to affiliated quota share contracts.~~premiums. Premiums earned ~~decreased~~increased by ~~6.9%~~14.6% to ~~$518.5~~$1,851.3 million for the three months ended September 30, ~~2017,~~2021, compared to ~~$556.7~~$1,615.5 million for the three months ended September 30, ~~2016~~2020 and ~~decreased~~increased by ~~4.6%~~14.3% to ~~$1,457.8~~$5,314.8 million for the nine months ended September 30, ~~2017,~~2021, compared to ~~$1,527.4~~$4,648.4 million for the nine months ended September 30, ~~2016.~~2020. The change in premiums earned relative to net written premiums is the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.

Net Investment Income.Net investment income increased ~~13.7%~~ to ~~$73.4~~$197.1 million for the three months ended September 30, ~~2017~~2021 compared with net investment income of ~~$64.6~~$135.4 million for the three months ended September 30, ~~2016 and~~2020. Net investment income increased ~~4.7%~~ to ~~$206.2~~$593.0 million for the nine months ended September 30, ~~2017~~2021 compared with net investment income of ~~$196.9~~$244.8 million for the nine months ended September 30, ~~2016.~~2020. Net pre-tax investment income as a percentage of average invested assets was ~~3.0%~~4.7% and 4.3% for the three months ended September 30, ~~2017, compared~~2021 and 2020, respectively and was 4.9% and 2.6% for the nine months ended September 30, 2021 and 2020, respectively. The increases in both income and yield were primarily the result of an increase in limited partnership income and higher income from other alternative investments. The limited partnership income primarily reflects increases in their reported net asset values. As such, until these asset values are monetized and the resultant income is distributed, they are subject to ~~2.7%~~future increases or decreases in the asset value, and the results may be volatile.

Net Realized Capital Gains (Losses). Net realized capital losses were $51.5 million and net realized capital gains were $115.2 million for the three months ended September 30, ~~2016~~2021 and ~~remained flat at 2.8% for the nine months ended~~ ~~September~~ ~~30, 2017 and 2016.~~2020, respectively. The ~~increases in income~~net realized capital losses of $51.5 million for the three months ended September 30, 2021, were comprised of $48.3 million of losses from fair value re-measurements and ~~nine~~$7.3 million in net allowances for credit losses, partially offset by $4.1 million of gains from sales of investments.The net realized capital gains of $115.2 million for the three months ended September 30, ~~2017~~2020, were comprised of $113.4 million of gains from fair value re-measurements, resulting primarily from increases in equity security valuations which further rebounded from declines in the ~~result~~first quarter of ~~higher income~~2020, and $2.3 million from ~~our limited partnerships and higher income from the growing fixed income portfolio,~~a decline in net allowances for credit losses partially offset by ~~lower dividend income~~$0.5 million of losses from ~~our equity portfolio.~~

~~Net Realized Capital Gains (Losses).~~sales of investments.

Net realized capital gains were ~~$228.5~~$267.3 million and net realized capital losses were ~~$50.1~~$107.3 million for the ~~three~~nine months ended September 30, ~~2017~~2021 and ~~2016,~~2020, respectively. The net realized capital gains of ~~$228.5~~$267.3 million for the nine months ended September 30, 2021 were comprised of ~~$227.5~~$273.7 million of gains from fair value re-measurements ~~on equity securities~~ and ~~other invested assets and $2.4~~$23.1 million of gains from sales ~~on our fixed maturity and equity securities,~~of investments, partially offset by ~~$1.5~~$29.5 million ~~of other-than-temporary impairments.~~in net allowances for credit losses. The net realized capital losses of ~~$50.1~~$107.3 million for the ~~three~~nine months ended September

30, ~~2016~~ 2020 were comprised of $~~30.9~~58.1 million of losses from fair value re-measurements, ~~on fixed maturity securities, equity securities~~$31.6 million of losses from sales of investments and $17.6 million of net allowances for credit losses.

Other Income (Expense). We recorded other income of $9.9 million and other ~~invested assets, net realized capital losses~~expense of ~~$28.0~~$1.8 million ~~from~~for the ~~sale~~three months ended September 30, 2021 and 2020, respectively. We recorded other income of ~~our Heartland subsidiary and $0.8 million of other-than-temporary impairments, partially offset by $9.6~~ ~~million of gains from sales on our fixed maturity and equity securities.~~

~~Net realized capital gains were $254.0~~$12.0 million and ~~net realized capital losses were $87.3~~other expense of $11.4 million for the nine months ended September 30, ~~2017~~2021 and ~~2016,~~2020, respectively.The ~~net realized capital gains of $254.0 million were comprised of $237.8 million of gains from fair value re-measurements on equity securities and other invested assets and $20.3~~ ~~million of gains from sales on our fixed maturity and equity securities, partially offset by $4.2 million of other-than-temporary impairments. The net realized capital losses of $87.3 million~~ ~~for the nine months ended September 30, 2016~~ ~~million were~~ ~~comprised of~~ ~~net realized capital losses of $28.0 million from the sale of our Heartland subsidiary, $25.2 million of other-than-temporary impairments, $22.4~~ million of losses from sales on our fixed maturity and equity securities and $11.7 million of losses from fair value re-measurements on fixed maturity securities, equity securities and other invested assets.

~~Other Income (Expense).~~ ~~We recorded other income of $1.5 million and $22.0 million~~ ~~for the three and nine months ended September 30,~~ ~~2017, respectively. We recorded other expense of $13.2~~ ~~million and $10.8~~ ~~million for the three and nine months ended September 30, 2016, respectively. The changes were~~change was primarily the result of fluctuations in foreign currency exchange rates.

Claims and Expenses.

Incurred Losses and Loss Adjustment Expenses. The following table presents our incurred losses and loss adjustment expenses ~~("LAE"~~(“LAE”) for the periods indicated.

Three Months Ended September 30,
Current Ratio %/ Prior Ratio %/ Total Ratio %/
(Dollars in millions) Year Pt Change Years Pt Change Incurred Pt Change
2017

Attritional $ 325.6 62.8 % $ (0.9 ) -0.2 % $ 324.7 62.6 %
Catastrophes 1,007.8 194.4 % (0.9 ) -0.2 % 1,006.9 194.2 %
Total $ 1,333.4 257.2 % $ (1.8 ) -0.4 % $ 1,331.6 256.8 %

2016

Attritional $ 300.4 54.0 % $ 0.1 0.0 % $ 300.6 54.0 %
Catastrophes 20.9 3.8 % (19.8 ) -3.6 % 1.0 0.2 %
Total $ 321.3 57.8 % $ (19.7 ) -3.6 % $ 301.6 54.2 %

Variance 2017/2016

Attritional $ 25.2 8.8 pts $ (1.0 ) (0.2 ) pts $ 24.1 8.6 pts
Catastrophes 986.9 190.6 pts 18.9 3.4 pts 1,005.9 194.0 pts
Total $ 1,012.1 199.4 pts $ 17.9 3.2 pts $ 1,030.0 202.6 pts

Nine Months Ended September 30,
Current Ratio %/ Prior Ratio %/ Total Ratio %/
(Dollars in millions) Year Pt Change Years Pt Change Incurred Pt Change
2017

Attritional $ 878.8 60.3 % $ 4.4 0.3 % $ 883.2 60.6 %
Catastrophes 1,039.3 71.3 % (3.9 ) -0.3 % 1,035.3 71.0 %
Total $ 1,918.1 131.6 % $ 0.5 0.0 % $ 1,918.5 131.6 %

2016

Attritional $ 894.7 58.5 % $ 0.9 0.1 % $ 895.6 58.6 %
Catastrophes 77.6 5.1 % (37.0 ) -2.4 % 40.6 2.7 %
Total $ 972.3 63.6 % $ (36.1 ) -2.3 % $ 936.2 61.3 %

Variance 2017/2016

Attritional $ (15.9 ) 1.8 pts $ 3.5 0.2 pts $ (12.4 ) 2.0 pts
Catastrophes 961.7 66.2 pts 33.1 2.1 pts 994.7 68.3 pts
Total $ 945.8 68.0 pts $ 36.6 2.3 pts $ 982.3 70.3 pts

(Some amounts may not reconcile due to rounding.)

	Three Months Ended September 30,
	Current		Ratio %/		Prior		Ratio %/		Total		Ratio %/
(Dollars in millions)	Year		Pt Change		Years		Pt Change		Incurred		Pt Change
2021
Attritional	$	1,111.7	60.0%		$	-	0.0%		$	1,111.7	60.0%
Catastrophes		544.1	29.4%			(2.7)	-0.1%			541.3	29.3%
Total	$	1,655.8	89.4%		$	(2.7)	-0.1%		$	1,653.0	89.3%
2020
Attritional	$	980.8	60.7%		$	-	0.0%		$	980.8	60.7%
Catastrophes		300.2	18.6%			(3.2)	-0.2%			297.0	18.4%
Total	$	1,281.1	79.3%		$	(3.2)	-0.2%		$	1,277.9	79.1%
Variance 2021/2020
Attritional	$	130.9	(0.7)	pts	$	-	-	pts	$	130.9	(0.7)	pts
Catastrophes		243.9	10.8	pts		0.5	0.1	pts		244.3	10.9	pts
Total	$	374.7	10.1	pts	$	0.5	0.1	pts	$	375.2	10.2	pts

	Nine Months Ended September 30,
	Current		Ratio %/		Prior		Ratio %/		Total		Ratio %/
(Dollars in millions)	Year		Pt Change		Years		Pt Change		Incurred		Pt Change
2021
Attritional	$	3,266.8	61.5%		$	(1.5)	0.0%		$	3,265.3	61.5%
Catastrophes		839.6	15.8%			(2.1)	0.0%			837.4	15.8%
Total	$	4,106.3	77.3%		$	(3.6)	0.0%		$	4,102.7	77.2%
2020
Attritional	$	2,943.2	63.3%		$	(1.0)	0.0%		$	2,942.2	63.3%
Catastrophes		344.9	7.4%			(3.9)	-0.1%			341.0	7.3%
Total	$	3,288.0	70.7%		$	(4.9)	-0.1%		$	3,283.2	70.6%
Variance 2021/2020
Attritional	$	323.6	(1.8)	pts	$	(0.5)	-	pts	$	323.1	(1.8)	pts
Catastrophes		494.7	8.4	pts		1.8	0.1	pts		496.5	8.5	pts
Total	$	818.3	6.6	pts	$	1.2	0.1	pts	$	819.5	6.6	pts

(Some amounts may not reconcile due to rounding.)

Incurred losses and LAE increased by 29.4% to ~~$1,331.6~~$1,653.0 million for the three months ended September 30, ~~2017~~2021 compared to ~~$301.6~~$1,277.9 million for the three months ended September 30, ~~2016,~~2020, primarily due to an increase of ~~$986.9~~$130.9 million in current year attritional losses, mainly related to the impact of the increase in premiums earned partially offset by $31.1 million of COVID-19 losses incurred in 2020 which did not recur in 2021, and an increase of $243.9 million in current year catastrophe losses, an increase in current year attritional losses of $25.2 million and $19.8 million of favorable development on prior years catastrophe losses in 2016, primarily related to the 2011 Japan earthquake, which did not recur in 2017. The increase in attritional losses was primarily due to the impact of changes in affiliated quota share contracts and changes in the mix of business.losses. The current year catastrophe losses of ~~$1,007.8 million~~ ~~for the three months ended~~ ~~September~~ ~~30,~~ 2017 related to Hurricane Irma ($476.2 million), Hurricane Maria ($318.9 million), Hurricane Harvey ($180.7 million) and the Mexico City earthquake ($32.1 million). The current year catastrophe losses of $20.9$544.1 million for the three months ended September 30, ~~2016 were~~2021 related to Hurricane ~~Hermine~~Ida ($~~6.8~~430.8 million)~~, 2016 U.S. Storms~~ and the European floods ($~~6.6~~112.5

million). The current year catastrophe losses of $300.2 million for the three months ended September 30, 2020 related to Hurricane Laura ($122.4 million), the ~~Fort McMurray Canada wildfire~~Northern California wildfires ($~~5.0~~52.0 million), the ~~Taiwan earthquake~~California Glass wildfire ($~~2.3~~30.0 million), Hurricane Sally ($24.6 million), Oregon wildfires ($21.0 million), Hurricane Isaias ($19.9 million), the Derecho storms ($15.1 million), Calgary storms in Canada ($15.0 million), the U.S. Civil Unrest ($2.4 million) and the ~~Ecuador earthquake~~Nashville tornadoes ($~~0.2~~2.3 million), partially offset by a reduction in the loss estimate for the Australia East Coast Storm ($3.2 million) and the 2020 Australia fires ($1.3 million).

Incurred losses and LAE increased by ~~104.9%~~25.0% to ~~$1,918.5~~$4,102.7 million for the nine months ended September 30, ~~2017~~2021 compared to ~~$936.2~~$3,283.2 million for the nine months ended September 30, ~~2016,~~2020, primarily due to an increase of ~~$961.7~~$494.7 million in current year catastrophe losses and ~~favorable development~~an increase of ~~$37.0~~$323.6 million ~~on prior~~in current year ~~catastrophe~~attritional losses, ~~in 2016, primarily~~mainly related to the ~~2011 Japan earthquake,~~impact of the increase in premiums earned partially offset by $104.8 million of COVID-19 losses incurred in 2020 which did not recur in ~~2017.~~2021. The current year catastrophe losses of ~~$1,039.3 million~~ ~~for the~~ ~~nine months ended September 30~~, 2017 related to Hurricane Irma ($476.2 million), Hurricane Maria ($318.9 million), Hurricane Harvey ($180.7 million), the Mexico City earthquake ($32.1 million), the South Africa Knysna fires ($10.0 million), Cyclone Debbie in Australia ($8.3 million), the Peru storms ($6.9 million) and the 2017 US Midwest storms ($6.2 million). The current year catastrophe losses of $77.6$839.6 million for the nine months ended September 30, ~~2016 were~~2021 primarily related to ~~the Fort McMurray Canada wildfire~~Hurricane Ida ($~~26.9~~430.8 million), the ~~2016 U.S. Storms~~Texas winter storms ($~~24.9 million), the Ecuador earthquake ($11.6 million), the 2016 Taiwan earthquake ($7.5~~278.8 million) and ~~Hurricane Hermine~~the European floods ($~~6.8~~112.5 million).

~~Commission, Brokerage, Taxes~~with the rest of the losses emanating from the 2021 Australia floods and ~~Fees.~~ ~~Commission, brokerage, taxes and fees decreased by 58.3% to $34.5 million~~ ~~for the three months ended~~ ~~September~~ ~~30,~~ ~~2017 compared to~~ ~~$82.8 million for the three months ended~~ ~~September~~ ~~30,~~ ~~2016.~~ ~~Commission, brokerage, taxes and fees decreased by 32.8% to $147.6 million~~ ~~for the nine months ended September 30,~~ ~~2017 compared to~~ ~~$219.6~~Victoria Australia flooding. The current year catastrophe losses of $344.9 million for the nine months ended September 30, ~~2016.~~2020 related to Hurricane Laura ($122.4 million), the Northern California wildfires ($52.0 million), the California Glass wildfire ($30.0 million), Hurricane Sally ($24.6 million), Oregon wildfires ($21.0 million), Hurricane Isaias ($19.9 million), the U.S. Civil Unrest ($17.4 million), the Derecho storms ($15.1 million), the Nashville tornadoes ($15.1 million), the Calgary storms in Canada ($15.0 million), the Australia East Coast storm ($6.8 million) and the 2020 Australia fires ($5.6 million).

Commission, Brokerage, Taxes and Fees. Commission, brokerage, taxes and fees increased to $388.8 million for the three months ended September 30, 2021 compared to $322.4 million for the three months ended September 30, 2020. Commission, brokerage, taxes and fees increased to $1,125.5 million for the nine months ended September 30, 2021 compared to $1,001.2 million for the nine months ended September 30, 2020. The ~~decreases~~increases were ~~primarily~~mainly due to the impact of the ~~decrease~~increase in premiums earned and changes in the ~~impact~~mix of ~~affiliated quota share contracts.~~

business.

Other Underwriting Expenses. Other underwriting expenses ~~were $57.7 million~~ ~~and~~ ~~$64.1~~remained relatively flat at $109.5 million for the three months ended September 30, ~~2017 and September 30, 2016, respectively. The decrease~~2021 compared to $109.4 million for the three ~~month period was primarily due to lower variable compensation costs.~~months ended September 30, 2020. Other underwriting expenses ~~were flat at $181.8 million~~ ~~and~~ ~~$181.7~~increased to $329.2 million for the nine months ended September 30, ~~2017 and~~2021 compared to $304.7 million for the nine months ended September 30, ~~2016, respectively.~~

2020. The year over year increase was mainly due to the impact of increase in premiums earned and costs incurred to support the expansion of the insurance business.

Corporate Expenses.Corporate expenses, which are general operating expenses that are not allocated to segments, ~~decreased slightly~~have increased to ~~$1.1~~$10.9 million from ~~$1.8~~ $4.2 million for the three months ended September 30, ~~2017~~2021 and ~~2016,~~2020, respectively, and ~~were flat at $6.2~~increased to $23.1 million from $11.4 million for the nine months ended September 30, ~~2017~~2021 and ~~2016,~~2020, respectively.

The increases were mainly due to higher compensation costs from increased staff count.

Interest, Fees and Bond Issue Cost Amortization Expense. Interest, fees and other bond amortization ~~were $7.2~~expense was $15.5 million and ~~$8.9~~$6.5 million for the three months ended September 30, ~~2017~~ 2021 and ~~2016,~~2020, respectively. Interest, fees and other bond amortization ~~were $24.0~~expense was $46.6 million and ~~$26.6~~$20.9 million for the nine months ended September 30, ~~2017~~ 2021 and ~~2016,~~2020, respectively. The ~~decreases~~variances in ~~expense for both the three and nine month periods~~expenses were primarily due to interest expense on the ~~conversion~~$1,000.0 million of senior notes issued in October 2020 and the movement in the floating interest rate related to the long term subordinated notes, ~~from a fixed rate of 6.6% to a floating rate,~~ which is reset quarterly per the note agreement. The floating rate was ~~3.70%~~2.51% as of September 30, ~~2017.~~

2021.

Income Tax Expense (Benefit). ~~We had an~~ ~~income tax benefit of $220.5 million~~ ~~and income tax expense of~~ ~~$22.4 million for the three months ended~~ ~~September~~ ~~30,~~ ~~2017 and 2016, respectively.~~ We had an income tax benefit of ~~$153.3~~$27.5 million and i~~ncome~~an income tax expense of ~~$69.4~~ $118.1 million for the three and nine months ended September 30, ~~2017~~2021, respectively. We had an income tax expense of $24.1 million and ~~2016,~~income tax benefit of $12.8 million for the three and nine months ended September 30, 2020, respectively. I~~ncome~~Income tax benefit or expense is primarily a function of the ~~Company's~~geographic location of the Company’s pre-tax income and the statutory tax rates in those jurisdictions. The effective tax rate as(“ETR”) is

primarily affected by tax-exempt investment income, qualifying dividends, and foreign tax ~~credits and as calculated under the annualized effective tax rate ("AETR") method.~~credits. Variations in ~~income tax expense~~the ETR generally result from changes in the relative levels of pre-tax income, including the impact of catastrophe losses and net capital gains (losses)~~. However, if the AETR approach produces a year-to-date~~, among jurisdictions with different tax benefit which exceeds the amount which is estimated to be recoverable for the full year, then the tax benefit for the interim reporting period will be limited, as prescribed under ASC 740-270, to the estimated tax recoverable based on the year-to-date result.rates. The ~~decrease~~change in income tax expense (benefit) for the three and nine months ended September 30, ~~2017~~2021 compared to the three and nine months ended September 30, ~~2016~~2020 resulted primarily from higher investment income and earned premiums offset by an increase in catastrophe losses.

The Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was ~~primarily due~~passed by Congress and signed into law by the President on March 27, 2020 in response to the ~~significant catastrophe~~COVID-19 pandemic. Among the provisions of the CARES Act was a special tax provision which allows companies to elect to carryback five years net operating losses incurred ~~during~~in the ~~third~~2018, 2019 and/or 2020 tax years. The Tax Cuts and Jobs Act of 2017 had eliminated net operating loss carrybacks for most companies. The Company determined that the special five year loss carryback tax provision provided a tax benefit of $31.0 million which it recorded in the quarter ~~of 2017.~~

ended March 31, 2020.

Net Income (Loss).

Our net loss was ~~$389.7~~$143.3 million and ~~our~~ net income was ~~$76.3~~$119.8 million, for the three months ended September 30, ~~2017~~2021 and ~~2016,~~2020 respectively. Our net ~~loss~~income was ~~$184.9~~$441.9 million and ~~our net income was $186.7~~$165.9 million, for the nine months ended September 30, ~~2017~~2021 and ~~2016,~~2020 respectively. The changes were primarily driven by the financial component fluctuations explained above.

Ratios.

Our combined ratio increased by ~~194.0~~10.4 points to ~~274.6%~~116.2% for the three months ended September 30, ~~2017,~~2021 compared to ~~80.6%~~105.8% for the three months ended September 30, ~~2016,~~2020 and increased by ~~66.6~~5.9 points to ~~154.2%~~104.6% for the nine months ended September 30, ~~2017,~~2021 compared to ~~87.6%~~98.7% for the nine months ended September 30, ~~2016.~~2020. The loss ratio ~~components~~component increased ~~202.6~~by 10.2 points and ~~70.3~~6.6 points for the three and nine months ended September 30, ~~2017,~~2021, respectively, over the same period last year. The ~~changes~~increases were mainly due to ~~the increases in~~higher current year catastrophe losses. The commission and brokerage ratio ~~components decreased~~component increased to ~~6.7% from 14.9%~~21.0% for the three months ended September 30, ~~2017 and 2016, respectively,~~2021 compared to 20.0% for the three months ended September 30, 2020 and decreased to ~~10.1% from 14.4%~~21.2% for the nine months ended September 30, ~~2017~~2021 compared to 21.5% for the nine months ended September 30, 2020, reflecting changes in affiliated reinsurance agreements and ~~2016, respectively. The decreases reflect~~ changes in the mix of ~~business, the impact of affiliated quota share contracts and the impact from reinstatement premiums.~~business. The other underwriting expense ~~ratios~~ratio decreased to ~~11.1%~~5.9% from ~~11.5%~~6.7% for the three months ended September 30, ~~2017~~2021 and ~~2016,~~2020, respectively and ~~increased~~decreased to ~~12.5%~~6.2% from ~~11.9%~~6.6% for the nine months ended September 30, ~~2017~~2021 and ~~2016,~~2020, respectively. The ~~decrease in the three month period was~~decreases were mainly due to ~~lower variable compensation costs. The increase~~changes in the ~~nine month period was due to costs associated with the continued expansion~~mix of ~~the insurance business, partially offset~~business.

Stockholder's Equity.

Stockholder’s equity increased by ~~lower variable compensation costs.~~

~~Stockholder's Equity.~~

~~Stockholders' equity decreased by $130.9~~$343.5 million to ~~$5,167.6~~$6,757.8 million at September 30, ~~2017~~ 2021 from ~~$5,298.6~~$6,414.3 million at December 31, ~~2016,~~2020, principally as a result of ~~$184.9~~$441.9 million of net ~~loss, partially offset by $43.2 million of net foreign currency translation adjustments, $5.4~~income and $5.6 million of net benefit plan obligation adjustments, ~~$5.2~~partially offset by $99.8 million of net unrealized depreciation on investments, net of tax and ~~$0.2~~$4.6 million of ~~share-based compensation transactions.~~

net foreign currency translation adjustments.

Consolidated Investment Results

Net Investment Income.

Net investment income increased ~~by 13.7%~~ to ~~$73.4~~$197.1 million for the three months ended September 30, ~~201~~72021 compared to ~~$64.6~~$135.4 million for the three months ended September 30, ~~201~~6.2020. Net investment income increased ~~by 4.7%~~ to ~~$206.2~~$593.0 million for the nine months ended September 30, ~~201~~72021 compared to ~~$196.9~~$244.8 million for the nine months ended September 30, ~~201~~6. 2020. The increases ~~for the three and nine month periods~~ were primarily ~~due to~~the result of an increase in limited partnership income and higher income from other alternative investments. The limited partnership income primarily reflects increases in their reported net asset values. As such, until these asset values are monetized and the ~~growing fixed~~resultant income ~~portfolio, partially offset by lower dividend income from our equity portfolio.~~is distributed, they are subject to future increases or decreases in the asset value, and the results may be volatile.

The following table shows the components of net investment income for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in millions)	2021		2020		2021		2020
Fixed maturities	$	83.4	$	78.3	$	260.4	$	227.3
Equity securities		3.8		2.5		10.1		6.1
Short-term investments and cash		0.1		0.5		0.3		2.6
Other invested assets
Limited partnerships		81.9		35.9		260.5		2.4
Dividends from preferred shares of affiliate		7.8		7.8		23.3		23.3
Other		30.9		14.7		62.8		(1.3)
Gross investment income before adjustments		207.9		139.7		617.4		260.4
Funds held interest income (expense)		0.8		0.9		7.0		5.1
Interest income from Parent		1.6		1.3		4.2		3.9
Gross investment income		210.3		141.8		628.6		269.3
Investment expenses		13.1		(6.4)		35.6		(24.5)
Net investment income	$	197.2	$	135.4	$	593.0	$	244.8

(Some amounts may not reconcile due to rounding.)

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2021	2020	2021	2020
Annualized pre-tax yield on average cash and invested assets	4.7%	4.3%	4.9%	2.6%
Annualized after-tax yield on average cash and invested assets	3.7%	3.4%	3.9%	2.1%

Three Months Ended Nine Months Ended
September 30, September 30,
(Dollars in millions) 2017 2016 2017 2016
Fixed maturities $ 48.3 $ 44.8 $ 144.9 $ 134.9
Equity securities 6.3 7.9 19.4 25.8
Short-term investments and cash 0.6 0.3 1.6 0.9
Other invested assets
Limited partnerships 11.8 6.0 20.6 17.7
Dividends from preferred shares of affiliate 7.8 7.8 23.3 23.3
Other 1.5 0.5 4.2 0.3
Gross investment income before adjustments 76.4 67.3 214.1 202.8
Funds held interest income (expense) 1.1 1.1 4.0 4.7
Interest income from Parent 1.1 1.1 3.2 3.2
Gross investment income 78.5 69.5 221.3 210.8
Investment expenses (5.1 ) (4.9 ) (15.1 ) (13.9 )
Net investment income $ 73.4 $ 64.6 $ 206.2 $ 196.9

(Some amounts may not reconcile due to rounding.)

~~The following tables show a comparison of various investment yields for the periods indicated:~~

At At
September 30, December 31,
2017 2016
Imbedded pre-tax yield of cash and invested assets at December 31 3.1% 2.9%
Imbedded after-tax yield of cash and invested assets at December 31 2.1% 2.0%

Three Months Ended Nine Months Ended
September 30, September 30,
2017 2016 2017 2016
Annualized pre-tax yield on average cash and invested assets 3.0% 2.7% 2.8% 2.8%
Annualized after-tax yield on average cash and invested assets 2.1% 1.9% 2.0% 1.9%

Net Realized Capital Gains (Losses).

The following table presents the composition of our net realized capital gains (losses) for the periods indicated:

Three Months Ended September 30, Nine Months Ended September 30,
(Dollars in millions) 2017 2016 Variance 2017 2016 Variance
Gains (losses) from sales:

Fixed maturity securities, market value
Gains $ 8.0 $ 6.3 $ 1.7 $ 23.7 $ 13.9 $ 9.8
Losses (4.1 ) (1.9 ) (2.2 ) (6.9 ) (24.1 ) 17.2
Total 3.9 4.4 (0.5 ) 16.8 (10.3 ) 27.0

Fixed maturity securities, fair value
Gains - - - - - -
Losses - - - - (1.9 ) 1.9
Total - - - - (1.9 ) 1.9

Equity securities, fair value
Gains 2.2 6.9 (4.7 ) 13.8 13.5 0.3
Losses (3.7 ) (1.4 ) (2.3 ) (10.3 ) (23.6 ) 13.3
Total (1.5 ) 5.5 (7.0 ) 3.5 (10.1 ) 13.6

Total net realized gains (losses) from sales
Gains 10.2 13.2 (3.0 ) 37.5 27.4 10.1
Losses (7.8 ) (3.4 ) (4.5 ) (17.2 ) (49.7 ) 32.5
Total 2.4 9.6 (7.5 ) 20.3 (22.4 ) 42.6

Gain (losses) on sale of subsidiary:
- (28.0 ) 28.0 - (28.0 ) 28.0

Other than temporary impairments:
(1.5 ) (0.8 ) (0.7 ) (4.2 ) (25.2 ) 21.0

Gains (losses) from fair value adjustments:

Fixed maturities, fair value - 0.1 (0.1 ) - 1.4 (1.4 )
Equity securities, fair value 29.6 16.0 13.6 82.0 34.7 47.3
Other invested assets, fair value 197.9 (47.0 ) 244.9 155.8 (47.8 ) 203.6
Total 227.5 (30.9 ) 258.4 237.8 (11.7 ) 249.5

Total net realized gains (losses) $ 228.5 $ (50.1 ) $ 278.6 $ 254.0 $ (87.3 ) $ 341.3
(Some amounts may not reconcile due to rounding.)

	Three Months Ended September 30,						Nine Months Ended September 30,
(Dollars in millions)	2021		2020		Variance		2021		2020		Variance
Gains (losses) from sales:
Fixed maturity securities, market value
Gains	$	8.9	$	5.0	$	3.9	$	24.1	$	15.6	$	8.5
Losses		(6.2)		(5.0)		(1.2)		(13.3)		(34.6)		21.3
Total		2.7		-		2.7		10.8		(19.0)		29.8
Fixed maturity securities, fair value
Gains		-		-		-		-		-		-
Losses		-		(2.0)		2.0		-		(2.0)		2.0
Total		-		(2.0)		2.0		-		(2.0)		2.0
Equity securities, fair value
Gains		2.8		9.5		(6.7)		17.7		30.3		(12.6)
Losses		(3.3)		(9.8)		6.5		(11.4)		(41.9)		30.5
Total		(0.5)		(0.3)		(0.2)		6.3		(11.6)		17.9
Other invested assets
Gains		2.4		1.4		1.0		8.0		6.0		2.0
Losses		(0.4)		(0.3)		(0.1)		(2.0)		(5.9)		3.9
Total		1.9		1.1		0.8		6.0		0.1		5.9
Short Term Investments:
Gains		-		0.8		(0.8)		-		1.0		(1.0)
Losses		-		-		-		-		-		-
Total		-		0.8		(0.8)		-		1.0		(1.0)
Total net realized gains (losses) from sales
Gains		14.1		16.7		(2.6)		49.8		52.9		(3.1)
Losses		(9.9)		(17.1)		7.2		(26.7)		(84.4)		57.7
Total		4.1		(0.5)		4.6		23.1		(31.6)		54.7

Allowances for credit losses:		(7.3)		2.3		(9.6)		(29.5)		(17.6)		(11.9)

Gains (losses) from fair value adjustments:
Fixed maturities, fair value		-		3.3		(3.3)		-		1.9		(1.9)
Equity securities, fair value		(4.5)		94.3		(98.8)		136.9		120.8		16.1
Other invested assets, fair value		(43.8)		15.8		(59.6)		136.8		(180.8)		317.6
Total		(48.3)		113.4		(161.7)		273.7		(58.1)		331.8

Total net realized gains (losses)	$	(51.5)	$	115.2	$	(166.7)	$	267.3	$	(107.3)	$	374.6

(Some amounts may not reconcile due to rounding.)

Net Realized Capital Gains (Losses).Net realized capital ~~gains~~losses were ~~$228.5~~$51.5 million and net realized capital gains were $115.2 million for the three months ended September 30, 2021 and 2020, respectively. The net realized capital losses of $51.5 million for the three months ended September 30, 2021, were ~~$50.1~~comprised of $48.3 million of losses from fair value re-measurements and $7.3 million in net allowances for credit losses, partially offset by $4.1 million of gains from sales of investments.The net realized capital gains of $115.2 million for the three months ended September 30, ~~2017 and 2016, respectively. For the three months ended September 30, 2017 we recorded $227.5~~2020, were comprised of $113.4 million of ~~net realized capital~~ gains ~~due to~~from fair value re-measurements, onresulting primarily from increases in equity ~~securities~~security valuations which further rebounded from declines in the first quarter of 2020, and ~~other invested assets and $2.4~~$2.3 million from a decline in net allowances for credit losses partially offset by $0.5 million of ~~net realized capital gains~~losses from sales of fixed maturity and equity securities, partially offset by $1.5 million of other-than-temporary impairments. For the three months ended September 30, 2016, we recorded $30.9 million of net realized capital losses due to fair value re-measurements on fixed maturity securities, equity securities and other invested assets, net realized capital losses of $28.0 million from the sale of our Heartland subsidiary and $0.8 million of other-than-temporary impairments, partially offset by $9.6 million of net realized capital gains from sales of fixed maturity and equity securities. The fixed maturity and equity sales for the three months ended September 30, 2017 and 2016 related primarily to adjusting the portfolios for overall market changes and individual credit shifts.investments.

Net realized capital gains were ~~$254.0~~$267.3 million and net realized capital losses were ~~$87.3~~$107.3 million for the nine months ended September 30, 2021 and 2020, respectively. The net realized capital gains of $267.3 million for the nine months ended September 30, ~~2017 and 2016, respectively. For the nine months ended September 30, 2017 we recorded $237.8~~2021 were comprised of $273.7 million of ~~net realized capital~~ gains ~~due to~~from fair value re-measurements ~~on equity securities~~ and ~~other invested assets and $20.3~~$23.1 million of ~~net realized capital~~ gains from sales of ~~fixed maturity and equity securities,~~investments, partially offset by ~~$4.2~~$29.5 million ~~of other-than-temporary impairments. For the nine months ended September 30, 2016, we recorded~~in net allowances for credit losses. The net realized capital losses of ~~$28.0~~$107.3 million ~~from the~~

sale of our Heartland subsidiary, $25.2 million of other-than-temporary impairments, $22.4 million of net realized capital losses from sales of fixed maturity and equity securities and $11.7 million of net realized capital losses due to fair value re-measurements on fixed maturity securities, equity securities and other invested assets. The fixed maturity and equity sales for the nine months ended September 30, ~~2017~~2020 were comprised of $58.1 million of losses from fair value re-measurements, $31.6 million of losses from sales of investments and ~~2016 related primarily to adjusting the portfolios~~$17.6 million of net allowances for ~~overall market changes and individual~~ credit ~~shifts.~~

losses.

Segment Results.

The ~~U.S.~~ Reinsurance operation writes worldwide property and casualty reinsurance and specialty lines of ~~business, including Marine, Aviation, Surety and A&H~~ business, on both a treaty and facultative basis, through reinsurance brokers, as well as directly with ceding ~~companies primarily within~~companies. Business is written in the ~~U.S. The International operation writes non-U.S. property and casualty reinsurance~~United States as well as through ~~Everest Re's~~ branches in Canada ~~Singapore~~ and ~~through offices in Brazil, Miami and New Jersey.~~Singapore. The Insurance operation writes property and casualty insurance directly and through brokers, surplus lines brokers and general agents ~~mainly~~ within the ~~U.S.~~

United States.

Underwriting results include earned premium less losses and LAE incurred, commission and brokerage expenses and other underwriting expenses. We measure our underwriting results using ratios, in particular loss, commission and brokerage and other underwriting expense ratios, which respectively, divide incurred losses, commissions and brokerage and other underwriting expenses by premiums earned.

Our loss and LAE reserves are ~~management's~~management’s best estimate of our ultimate liability for unpaid claims. We re-evaluate our estimates on an ongoing basis, including all prior period reserves, taking into consideration all available information and, in particular, recently reported loss claim experience and trends related to prior periods. Such re-evaluations are recorded in incurred losses in the period in which the re-evaluation is made.

The following discusses the underwriting results for each of our segments for the periods indicated:

~~U.S.~~

Reinsurance.

The following table presents the underwriting results and ratios for the ~~U.S.~~ Reinsurance segment for the periods indicated.

Three Months Ended September 30, Nine Months Ended September 30,
(Dollars in millions) 2017 2016 Variance % Change 2017 2016 Variance % Change
Gross written premiums $ 908.3 $ 654.8 $ 253.6 38.7 % $ 1,962.3 $ 1,597.0 $ 365.3 22.9 %
Net written premiums 295.6 327.2 (31.6 ) -9.7 % 649.9 711.7 (61.8 ) -8.7 %

Premiums earned $ 242.4 $ 249.2 $ (6.9 ) -2.8 % $ 653.0 $ 709.1 $ (56.1 ) -7.9 %
Incurred losses and LAE 678.9 137.2 541.7
NM
919.1 363.6 555.5 152.8 %
Commission and brokerage 31.7 48.1 (16.4 ) -34.1 % 115.2 148.0 (32.7 ) -22.1 %
Other underwriting expenses 12.1 14.3 (2.2 ) -15.2 % 40.6 39.9 0.8 1.9 %
Underwriting gain (loss) $ (480.4 ) $ 49.6 $ (530.0 ) NM $ (422.0 ) $ 157.7 $ (579.7 ) NM

Point Chg Point Chg
Loss ratio 280.1 % 55.1 % 225.0 140.8 % 51.3 % 89.5
Commission and brokerage ratio 13.1 % 19.3 % (6.2 ) 17.6 % 20.9 % (3.2 )
Other underwriting ratio 5.0 % 5.7 % (0.7 ) 6.2 % 5.6 % 0.6
Combined ratio 298.2 % 80.1 % 218.1 164.6 % 77.8 % 86.9

(Some amounts may not reconcile due to rounding.)
(NM, not meaningful)

	Three Months Ended September 30,							Nine Months Ended September 30,
(Dollars in millions)	2021		2020		Variance		% Change	2021		2020		Variance		% Change
Gross written premiums	$	1,693.0	$	1,473.3	$	219.8	14.9%	$	4,552.4	$	3,906.4	$	646.0	16.5%
Net written premiums		1,461.2		1,296.1		165.1	12.7%		3,961.3		3,403.1		558.2	16.4%

Premiums earned	$	1,280.2	$	1,153.7	$	126.4	11.0%	$	3,689.5	$	3,223.6	$	465.9	14.5%
Incurred losses and LAE		1,207.5		936.9		270.6	28.9%		2,917.3		2,250.3		667.0	29.6%
Commission and brokerage		319.7		265.1		54.6	20.6%		935.3		818.3		117.0	14.3%
Other underwriting expenses		32.0		35.7		(3.6)	-10.1%		101.3		92.1		9.2	10.0%
Underwriting gain (loss)	$	(279.1)	$	(84.0)	$	(195.1)	232.4%	$	(264.4)	$	62.9	$	(327.3)	-520.2%

							Point Chg							Point Chg
Loss ratio		94.3%		81.2%			13.1		79.1%		69.8%			9.3
Commission and brokerage ratio		25.0%		23.0%			2.0		25.3%		25.4%			(0.1)
Other underwriting ratio		2.5%		3.1%			(0.6)		2.7%		2.8%			(0.1)
Combined ratio		121.8%		107.3%			14.5		107.2%		98.0%			9.1

(Some amounts may not reconcile due to rounding.)
(NM, not meaningful)

Premiums.Gross written premiums increased by ~~38.7%~~14.9% to ~~$908.3~~$1,693.0 million for the three months ended September 30, ~~201~~72021 from ~~$654.8~~$1,473.3 million for the three months ended September 30, ~~201~~6,2020 primarily due to ~~the new crop reinsurance~~

increases in casualty pro rata business, ~~related to the sale~~casualty excess of ~~Heartland~~loss business and ~~the influx~~property catastrophe excess of ~~reinstatement premiums due to the catastrophe losses.~~loss writings. Net written premiums ~~decreased~~increased by ~~9.7%~~12.7% to ~~$295.6~~$1,461.2 million for the three months ended September 30, ~~201~~72021 compared to ~~$327.2~~$1,296.1 million for the three months ended September 30, ~~201~~6. ~~The difference between~~2020, which is consistent with the change in gross written ~~premiums compared to the change in net written premiums is primarily due to a varying utilization of reinsurance primarily related to the affiliated quota share contracts.~~premiums. Premiums earned ~~decreased 2.8%~~increased 11.0% to ~~$242.4~~$1,280.2 million for the three months ended September 30, ~~201~~72021 compared to ~~$249.2~~$1,153.7 million for the three months ended September 30, ~~201~~6. The change in premiums earned relative to net written premiums is primarily the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.

~~Gross written premiums increased by 22.9% to $1,962.3 million for the nine months ended September 30, 201~~7 ~~from $1,597.0 million for the nine months ended September 30, 201~~6, primarily due to the new crop reinsurance business, an increase in treaty casualty business and the influx of reinstatement premiums due to the catastrophe losses. Net written premiums decreased by 8.7% to $649.9 million for the nine months ended September 30, 2017 ~~compared to $711.7 million for the nine months ended September 30, 201~~6. The difference between the change in gross written premiums compared to the change in net written premiums is primarily due to a varying utilization of reinsurance primarily related to the affiliated quota share contracts. Premiums earned decreased 7.9% to $653.0 million for the nine months ended September 30, 2017 ~~compared to $709.1 million for the nine months ended September 30, 201~~6. The change in premiums earned relative to net written premiums is primarily the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.

~~Incurred Losses and LAE.~~ ~~The following table presents the incurred losses and LAE for the U.S. Reinsurance segment for the periods indicated.~~

Three Months Ended September 30,
Current Ratio %/ Prior Ratio %/ Total Ratio %/
(Dollars in millions) Year Pt Change Years Pt Change Incurred Pt Change
2017

Attritional $ 128.0 52.8 % $ (0.4 ) -0.2 % $ 127.5 52.6 %
Catastrophes 551.6 227.6 % (0.2 ) -0.1 % 551.4 227.5 %
Total segment $ 679.6 280.4 % $ (0.6 ) -0.3 % $ 678.9 280.1 %

2016

Attritional $ 129.8 52.1 % $ (1.0 ) -0.4 % $ 128.8 51.7 %
Catastrophes 14.4 5.8 % (5.9 ) -2.4 % 8.5 3.4 %
Total segment $ 144.2 57.9 % $ (6.9 ) -2.8 % $ 137.2 55.1 %

Variance 2017/2016

Attritional $ (1.8 ) 0.7 pts $ 0.6 0.2 pts $ (1.3 ) 0.9 pts
Catastrophes 537.2 221.8 pts 5.7 2.3 pts 542.9 224.1 pts
Total segment $ 535.4 222.5 pts $ 6.3 2.5 pts $ 541.7 225.0 pts

Nine Months Ended September 30,
Current Ratio %/ Prior Ratio %/ Total Ratio %/
(Dollars in millions) Year Pt Change Years Pt Change Incurred Pt Change
2017

Attritional $ 374.8 57.4 % $ (4.7 ) -0.7 % $ 370.0 56.7 %
Catastrophes 553.2 84.7 % (4.1 ) -0.6 % 549.1 84.1 %
Total segment $ 928.0 142.1 % $ (8.8 ) -1.3 % $ 919.1 140.8 %

2016

Attritional $ 365.2 51.6 % $ (1.3 ) -0.2 % $ 363.9 51.4 %
Catastrophes 15.8 2.2 % (16.1 ) -2.3 % (0.3 ) -0.1 %
Total segment $ 381.0 53.8 % $ (17.4 ) -2.5 % $ 363.6 51.3 %

Variance 2017/2016

Attritional $ 9.6 5.8 pts $ (3.4 ) (0.5 ) pts $ 6.1 5.3 pts
Catastrophes 537.4 82.5 pts 12.0 1.7 pts 549.4 84.2 pts
Total segment $ 547.0 88.3 pts $ 8.6 1.2 pts $ 555.5 89.5 pts

(Some amounts may not reconcile due to rounding.)

~~Incurred losses increased to $678.9 million for the three months ended September 30, 201~~7 ~~compared to $137.2 million for the three months ended September 30, 201~~6~~, primarily due to an increase of $537.2 million in current year catastrophe losses.~~ ~~The current year catastrophe losses of $551.6 million~~ ~~for the three months ended September 30, 2017 related to Hurricane Irma ($348.6 million), Hurricane Harvey ($128.5 million), Hurricane Maria ($74.0 million), and the Mexico City earthquake ($1.1 million).~~ ~~The $14.4 million of current year catastrophe losses for the three months ended September 30, 2016 were related to Hurricane Hermine ($6.8 million), 2016 U.S. Storms ($6.3 million) and the Fort McMurray Canada Wildfire ($1.3 million).~~

~~Incurred losses increased by 152.8% to $919.1 million for the nine months ended September 30, 201~~7 ~~compared to $363.6 million for the nine months ended September 30, 201~~6, due to an increase of $537.4 million in current year catastrophe losses, favorable development of $16.1 million on prior years' catastrophe losses in 2016 which did not recur in 2017 and an increase of $9.6 million in current year attritional losses, resulting mainly from the impact of the new crop reinsurance contract. ~~The current year catastrophe losses of $553.2 million~~ ~~for the nine months ended September 30, 2017 related to Hurricane Irma ($348.6 million), Hurricane Harvey ($128.5 million), Hurricane Maria ($74.0 million), the Mexico City earthquake ($1.1 million) and the 2017 U.S. Storms ($1.4 million).~~ ~~The $15.8 million of current year catastrophe losses for the nine months ended September 30, 2016 were related to Hurricane Hermine ($6.8 million) and 2016 U.S. Storms ($9.6 million).~~

~~Segment Expenses.~~ ~~Commission and brokerage expenses decreased by 34.1% to $31.7 million~~ ~~for the three months ended September 30, 2017~~ ~~compared to $48.1 million~~ ~~for the three months ended September 30, 2016. Commission and brokerage expenses decreased by 22.1% to $115.2 million~~ ~~for the nine months ended September 30, 2017~~ ~~compared to $148.0 million~~ ~~for the nine months ended September 30, 2016~~. The decreases are mainly due to the impact of the new crop reinsurance contract which generally has a lower expense ratio, the impact of affiliated quota share contracts and the impact of the decrease in premiums earned.

~~Segment other underwriting expenses decreased to $12.1 million~~ ~~for the three months ended September 30, 2017~~ ~~from $14.3 million~~ ~~for the three months ended September 30, 2016. The decrease for the three month period was primarily due to lower variable compensation costs.~~ ~~Segment other underwriting expenses increased slightly to $40.6 million~~ ~~for the nine months ended September 30, 2017~~ ~~from $39.9 million~~ ~~for the nine months ended September 30, 2016.~~

~~International.~~

~~The following table presents the underwriting results and ratios for the International segment for the periods indicated.~~

Three Months Ended September 30, Nine Months Ended September 30,
(Dollars in millions) 2017 2016 Variance % Change 2017 2016 Variance % Change
Gross written premiums $ 363.2 $ 353.2 $ 10.0 2.8 % $ 975.3 $ 939.9 $ 35.4 3.8 %
Net written premiums 130.2 141.3 (11.1 ) -7.9 % 345.4 353.4 (8.1 ) -2.3 %

Premiums earned $ 123.9 $ 128.4 $ (4.4 ) -3.5 % $ 355.4 $ 372.8 $ (17.5 ) -4.7 %
Incurred losses and LAE 410.5 41.8 368.7
NM
557.4 206.7 350.7 169.7 %
Commission and brokerage 25.1 30.2 (5.1 ) -16.9 % 72.4 82.4 (10.0 ) -12.2 %
Other underwriting expenses 8.2 9.2 (1.0 ) -10.6 % 26.3 25.0 1.3 5.1 %
Underwriting gain (loss) $ (320.0 ) $ 47.1 $ (367.1 ) NM $ (300.8 ) $ 58.7 $ (359.5 ) NM

Point Chg Point Chg
Loss ratio 331.3 % 32.6 % 298.7 156.9 % 55.4 % 101.5
Commission and brokerage ratio 20.3 % 23.5 % (3.3 ) 20.4 % 22.1 % (1.7 )
Other underwriting ratio 6.6 % 7.2 % (0.6 ) 7.3 % 6.8 % 0.5
Combined ratio 358.2 % 63.3 % 294.9 184.6 % 84.3 % 100.4

(Some amounts may not reconcile due to rounding.)
(NM, not meaningful)

~~Premiums.~~ ~~Gross written premiums increased by 2.8% to $363.2 million for the three months ended September 30, 201~~7 ~~compared to $353.2 million for the three months ended September 30, 201~~6, primarily due to the increase in Middle East, African and Asian business, partially offset by a decline in Latin American business and a negative impact of $5.6 million from the movement of foreign exchange rates. Net written premiums decreased by 7.9% to $130.2 million for the three months ended September 30, 2017 ~~compared to $141.3 million for the three months ended September 30, 201~~6. The difference between the change in gross written premiums compared to the change in net written premiums is primarily due to varying utilization of reinsurance related to the quota share contracts, including affiliated quota share contracts. Premiums earned decreased 3.5% to $123.9 million for the three months ended September 30, 2017 ~~compared to $128.4 million for the three months ended September 30, 201~~6. The change in premiums earned relative to net written premiums is primarily the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.

~~Gross written premiums increased by 3.8% to $975.3 million for the nine months ended September 30, 201~~7 ~~compared to $939.9 million for the nine months ended September 30, 201~~6, primarily due to increases in Middle East, African and Asian business and the positive impact of $17.7 million from the movement of foreign exchange rates. Net written premiums decreased by 2.3% to $345.4 million for the nine months ended September 30, 2017 ~~compared to $353.4 million for the nine months ended September 30, 201~~6. The difference between the change in gross written premiums compared to the change in net written premiums is primarily due to varying utilization of reinsurance related to the quota share contracts, including affiliated quota share contracts. Premiums earned decreased 4.7% to $355.4 million for the nine months ended September 30, 2017 ~~compared to $372.8 million for the nine months ended September 30, 201~~6. The change in premiums earned relative to net written premiums is primarily the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.

~~Incurred Losses and LAE.~~ ~~The following table presents the incurred losses and LAE for the International segment for the periods indicated.~~

Three Months Ended September 30,
Current Ratio %/ Prior Ratio %/ Total Ratio %/
(Dollars in millions) Year Pt Change Years Pt Change Incurred Pt Change
2017

Attritional $ 64.0 51.7 % $ 0.7 0.6 % $ 64.7 52.3 %
Catastrophes 346.6 279.7 % (0.8 ) -0.7 % 345.8 279.0 %
Total segment $ 410.6 331.4 % $ (0.1 ) -0.1 % $ 410.5 331.3 %

2016

Attritional $ 49.3 38.4 % $ - 0.0 % $ 49.3 38.4 %
Catastrophes 6.5 5.1 % (14.0 ) -10.9 % (7.5 ) -5.8 %
Total segment $ 55.8 43.5 % $ (14.0 ) -10.9 % $ 41.8 32.6 %

Variance 2017/2016

Attritional $ 14.7 13.3 pts $ 0.7 0.6 pts $ 15.4 13.9 pts
Catastrophes 340.1 274.6 pts 13.2 10.2 pts 353.3 284.8 pts
Total segment $ 354.8 287.9 pts $ 13.9 10.8 pts $ 368.7 298.7 pts

Nine Months Ended September 30,
Current Ratio %/ Prior Ratio %/ Total Ratio %/
(Dollars in millions) Year Pt Change Years Pt Change Incurred Pt Change
2017

Attritional $ 182.9 51.5 % $ 2.6 0.7 % $ 185.5 52.2 %
Catastrophes 371.7 104.6 % 0.2 0.1 % 371.9 104.7 %
Total segment $ 554.6 156.1 % $ 2.8 0.8 % $ 557.4 156.9 %

2016

Attritional $ 185.6 49.8 % $ (3.4 ) -0.9 % $ 182.3 48.9 %
Catastrophes 45.2 12.1 % (20.8 ) -5.6 % 24.4 6.5 %
Total segment $ 230.8 61.9 % $ (24.1 ) -6.5 % $ 206.7 55.4 %

Variance 2017/2016

Attritional $ (2.7 ) 1.7 pts $ 6.0 1.6 pts $ 3.2 3.3 pts
Catastrophes 326.5 92.5 pts 21.0 5.7 pts 347.5 98.2 pts
Total segment $ 323.8 94.2 pts $ 26.9 7.3 pts $ 350.7 101.5 pts

(Some amounts may not reconcile due to rounding.)

~~Incurred losses and LAE increased to $410.5 million for the three months ended September 30, 201~~7 ~~compared to $41.8 million for the three months ended September 30, 201~~6, primarily due to an increase of $340.1 million in current year catastrophe losses, an increase of $14.7 million in current year attritional losses and $14.0 million of favorable development on prior year catastrophe losses in 2016, which did not recur in 2017. ~~The current year catastrophe losses of $346.6 million~~ ~~for the three months ended September 30, 2017 related to Hurricane Maria ($236.2 million), Hurricane Irma ($77.5 million), the Mexico City earthquake ($31.1 million) and Hurricane Harvey ($1.4 million).~~ ~~The $6.5 million of current year catastrophe losses for the three months ended September 30, 2016~~ ~~were related to the Fort McMurray Canada Wildfire ($3.7 million), the Taiwan earthquake ($2.3 million), 2016 U.S. Storms ($0.3 million) and the Ecuador earthquake ($0.2 million).~~

~~Incurred losses and LAE increased by 169.7% to $557.4 million for the nine months ended September 30, 201~~7 ~~compared to $206.7 million for the nine months ended September 30, 201~~6~~, primarily due to an increase of $326.5 million in current catastrophe losses and $20.8 million of favorable development on prior year catastrophe losses in 2016 which did not recur in 2017.~~ ~~The current year catastrophe losses of $371.7 million~~ ~~for the nine months ended September 30, 201~~7 related to Hurricane Maria ($236.2 million), Hurricane Irma ($77.5 million), the Mexico City earthquake ($31.1 million), the South Africa Knysna fires ($10.1 million), Cyclone Debbie in Australia ($8.3 million), the Peru storms ($7.1 million) and Hurricane Harvey ($1.4 million). ~~The $45.2 million of current year catastrophe losses for the nine months ended~~

~~September 30, 2016 were due to the Fort McMurray Canada wildfire ($25.4 million), the Ecuador earthquake ($11.8 million), the Taiwan earthquake ($7.6 million) and~~ ~~U.S. Storms ($0.3 million)~~.

~~Segment Expenses.~~ ~~Commission and brokerage decreased 16.9% to $25.1 million for the three months ended September 30, 201~~7 ~~compared to $30.2 million for the three months ended September 30, 201~~6~~. Commission and brokerage decreased 12.2% to $72.4 million for the nine months ended September 30, 201~~7 ~~compared to $82.4 million for the nine months ended September 30, 201~~6~~. The decreases were due to the impact of the decreases in premiums earned, the impact of affiliated quota share agreements and changes in the mix of business.~~

~~Segment other underwriting expenses decreased to $8.2 million for the three months ended September 30, 201~~7 ~~from $9.2 million for the three months ended September 30, 201~~6. ~~The decrease for the three month period is primarily due to lower variable compensation costs. Segment other underwriting expenses~~ ~~increased slightly to~~ ~~$26.3 million for the nine months ended September 30, 201~~7 ~~from $25.0 million for the nine months ended September 30, 201~~6.

~~Insurance.~~

~~The following table presents the underwriting results and ratios for the Insurance segment for the periods indicated.~~

Three Months Ended September 30, Nine Months Ended September 30,
(Dollars in millions) 2017 2016 Variance % Change 2017 2016 Variance % Change
Gross written premiums $ 429.6 $ 498.0 $ (68.4 ) -13.7 % $ 1,351.5 $ 1,276.8 $ 74.7 5.9 %
Net written premiums 144.9 154.1 (9.1 ) -5.9 % 442.2 462.8 (20.6 ) -4.4 %

Premiums earned $ 152.2 $ 179.1 $ (26.9 ) -15.0 % $ 449.4 $ 445.6 $ 3.9 0.9 %
Incurred losses and LAE 242.1 122.5 119.6 97.6 % 442.0 366.0 76.0 20.8 %
Commission and brokerage (22.3 ) 4.5 (26.7 ) NM (40.1 ) (10.9 ) (29.2 ) NM
Other underwriting expenses 37.4 40.7 (3.3 ) -8.1 % 114.9 116.8 (2.0 ) -1.7 %
Underwriting gain (loss) $ (105.0 ) $ 11.4 $ (116.4 ) NM $ (67.3 ) $ (26.4 ) $ (40.9 ) NM

Point Chg Point Chg
Loss ratio 159.0 % 68.4 % 90.6 98.3 % 82.1 % 16.2
Commission and brokerage ratio -14.6 % 2.5 % (17.1 ) -8.9 % -2.5 % (6.4 )
Other underwriting ratio 24.5 % 22.7 % 1.8 25.6 % 26.3 % (0.7 )
Combined ratio 168.9 % 93.6 % 75.3 115.0 % 105.9 % 9.1

(Some amounts may not reconcile due to rounding.)
(NM, not meaningful)

~~Premiums.~~ ~~Gross written premiums decreased by 13.7% to $429.6 million for the three months ended September 30, 201~~7 ~~compared to $498.0 million for the three months ended September 30, 201~~6. This decrease was primarily due to the sale of Heartland, which accounted for $162.4 million of gross written premiums in the third quarter of 2016. Excluding the impact of Heartland, gross written premiums increased by $94.0 million due to higher production from many lines of business, including retail casualty, surety and accident and health. Net written premiums decreased by 5.9% to $144.9 million for the three months ended September 30, 2017 ~~compared to $154.1 million for the three months ended September 30, 201~~6. The difference between the change in gross written premiums compared to the change in net written premiums is primarily due to the more conservative reinsurance position we have taken to support our expanded insurance business and the impact of affiliated quota share agreements. Premiums earned decreased 15.0% to $152.2 million for the three months ended September 30, 2017 ~~compared to $179.1 million for the three months ended September 30, 201~~6.2020. The change in premiums earned relative to net written premiums is the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.

Gross written premiums increased by ~~5.9%~~16.5% to ~~$1,351.5~~$4,552.4 million for the nine months ended September 30, ~~201~~7 ~~compared to $1,276.8~~2021 from $3,906.4 million for the nine months ended September 30, ~~201~~6~~. Excluding the impact~~2020 primarily due to increases in casualty pro rata business, casualty excess of ~~the sale~~loss business and property catastrophe excess of ~~Heartland, which accounted for $229.9 million of gross written premiums in the nine months~~

~~ended September 30, 2016, gross~~loss writings. Net written premiums increased ~~$304.6 million. This increase was primarily driven~~ by ~~expansion of many lines of business, including retail casualty, retail property, surety and accident and health. Net written premiums decreased by 4.4%~~16.4% to ~~$442.2~~$3,961.3 million for the nine months ended September 30, ~~201~~72021 compared to ~~$462.8~~$3,403.1 million for the nine months ended September 30, ~~201~~6. ~~The difference between~~2020, which is consistent with the change in gross written premiums compared to the change in net written premiums is primarily due to the more conservative reinsurance position we have taken to support our new business and the impact of affiliated quota share agreements. premiums. Premiums earned increased ~~0.9%~~14.5% to ~~$449.4~~$3,689.5 million for the nine months ended September 30, ~~201~~72021 compared to ~~$445.6~~$3,223.6 million for the nine months ended September 30, ~~201~~6.2020. The change in premiums earned relative to net written premiums is the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.

Incurred Losses and LAE.The following tables present the incurred losses and LAE for the Reinsurance segment for the periods indicated.

	Three Months Ended September 30,
	Current		Ratio %/		Prior		Ratio %/		Total		Ratio %/
(Dollars in millions)	Year		Pt Change		Years		Pt Change		Incurred		Pt Change
2021
Attritional	$	743.8	58.1%		$	-	0.0%		$	743.8	58.1%
Catastrophes		465.6	36.4%			(1.9)	-0.1%			463.7	36.2%
Total segment	$	1,209.4	94.5%		$	(1.9)	-0.1%		$	1,207.5	94.3%
2020
Attritional	$	677.2	58.7%		$	-	0.0%		$	677.2	58.7%
Catastrophes		262.7	22.8%			(3.0)	-0.3%			259.7	22.5%
Total segment	$	939.9	81.5%		$	(3.0)	-0.3%		$	936.9	81.2%
Variance 2021/2020
Attritional	$	66.7	(0.6)	pts	$	-	-	pts	$	66.7	(0.6)	pts
Catastrophes		202.9	13.6	pts		1.1	0.2	pts		204.0	13.7	pts
Total segment	$	269.6	13.0	pts	$	1.1	0.2	pts	$	270.6	13.1	pts

	Nine Months Ended September 30,
	Current		Ratio %/		Prior		Ratio %/		Total		Ratio %/
(Dollars in millions)	Year		Pt Change		Years		Pt Change		Incurred		Pt Change
2021
Attritional	$	2,216.3	60.1%		$	0.5	0.0%		$	2,216.8	60.1%
Catastrophes		703.6	19.1%			(3.1)	-0.1%			700.5	19.0%
Total segment	$	2,919.9	79.1%		$	(2.6)	-0.1%		$	2,917.3	79.1%
2020
Attritional	$	1,967.2	61.0%		$	(0.6)	0.0%		$	1,966.6	61.0%
Catastrophes		286.9	8.9%			(3.2)	-0.1%			283.7	8.8%
Total segment	$	2,254.1	69.9%		$	(3.8)	-0.1%		$	2,250.3	69.8%
Variance 2021/2020
Attritional	$	249.0	(0.9)	pts	$	1.1	-	pts	$	250.2	(0.9)	pts
Catastrophes		416.8	10.2	pts		0.1	-	pts		416.8	10.2	pts
Total segment	$	665.8	9.3	pts	$	1.2	-	pts	$	667.0	9.3	pts

(Some amounts may not reconcile due to rounding.)

Incurred losses increased by 28.9% to $1,207.5 million for the three months ended September 30, 2021 compared to $936.9 million for the three months ended September 30, 2020. The rise in incurred losses was primarily due to an increase of $202.9 million on current year catastrophe losses and an increase of $66.7 million in current year attritional losses, mainly related to the impact of the increase in premiums earned partially offset by $27.1 million of COVID-19 losses incurred in 2020 which did not recur in 2021. The $465.6 million of current year catastrophe losses for the three months ended September 30, 2021 primarily related to Hurricane Ida ($352.4 million) and the European floods ($112.5 million). The $262.7 million of current year catastrophe losses for the three months ended September 30, 2020 related to Hurricane Laura ($107.4 million), the Northern California wildfires ($52.0 million), the California Glass wildfire ($30.0 million), Oregon wildfires ($21.0 million), Hurricane Isaias ($17.9 million), the Derecho storms ($13.1 million), Calgary storms in Canada ($12.5 million), Hurricane Sally ($8.6 million), the U.S. Civil Unrest ($2.4 million) and the Nashville tornadoes ($2.3 million), partially offset by a reduction in the loss estimate for the Australia East Coast storm ($3.2 million) and the 2020 Australia fires ($1.3 million).

Incurred losses increased by 29.6% to $2,917.3 million for the nine months ended September 30, 2021 compared to $2,250.3 million for the nine months ended September 30, 2020. The rise in incurred losses was primarily due to an increase of $416.8 million on current years catastrophe losses and an increase of $249.0 million in current year attritional losses, primarily related to the impact of the increase in premiums earned and partially offset by $72.6 million of COVID-19 losses incurred in 2020 which did not recur in 2021. The $703.6 million of current year catastrophe losses for the nine months ended September 30, 2021 primarily related to Hurricane Ida ($352.4 million), the Texas winter storms ($221.3 million) and the European floods ($112.5 million) with the rest of the losses emanating from the 2021 Australia floods and Victoria Australia flooding. The current year catastrophe losses of $286.9 million for the nine months ended September 30, 2020 primarily related to Hurricane Laura ($107.4 million), the Northern California wildfires ($52.0 million), the California Glass wildfire ($30.0 million), Oregon wildfires ($21.0 million), Hurricane Isaias ($17.9 million), the Derecho storms ($13.1 million), the Nashville tornadoes ($9.6 million), the Calgary storms in Canada ($12.5 million), Hurricane Sally ($8.6 million), the Australia East Coast storm ($6.8 million), the 2020 Australia fires ($5.6 million) and the U.S. Civil Unrest ($2.4 million).

Segment Expenses. Commission and brokerage increased to $319.7 million for the three months ended September 30, 2021 compared to $265.1 million for the three months ended September 30, 2020. Commission and brokerage increased to $935.3 million for the nine months ended September 30, 2021 compared to $818.3 million for the nine months ended September 30, 2020. The increases were mainly due to the impact of the increase in premiums earned and changes in the mix of business.

Segment other underwriting expenses decreased to $32.0 million for the three months ended September 30, 2021 from $35.7 million for the three months ended September 30, 2020. The quarter over quarter decrease was primarily due to changes in the mix of business. Segment other underwriting expenses increased to $101.3 million for the nine months ended September 30, 2021 from $92.1 million for the nine months ended September 30, 2020. The year over year increase was mainly due to the impact of the increase in premiums earned.

Insurance.

The following table presents the underwriting results and ratios for the Insurance segment for the periods indicated.

	Three Months Ended September 30,							Nine Months Ended September 30,
(Dollars in millions)	2021		2020		Variance		% Change	2021		2020		Variance		% Change
Gross written premiums	$	830.7	$	591.7	$	239.0	40.4%	$	2,421.7	$	1,971.8	$	449.9	22.8%
Net written premiums		608.2		429.6		178.7	41.6%		1,801.9		1,462.9		339.0	23.2%

Premiums earned	$	571.2	$	461.7	$	109.5	23.7%	$	1,625.3	$	1,424.8	$	200.5	14.1%
Incurred losses and LAE		445.5		340.9		104.5	30.6%		1,185.4		1,032.9		152.5	14.8%
Commission and brokerage		69.1		57.3		11.8	20.6%		190.3		182.9		7.4	4.0%
Other underwriting expenses		77.5		73.7		3.8	5.2%		227.9		212.6		15.3	7.2%
Underwriting gain (loss)	$	(20.9)	$	(10.2)	$	(10.7)	NM	$	21.7	$	(3.6)	$	25.3	-702.4%

							Point Chg							Point Chg
Loss ratio		78.0%		73.8%			4.2		72.9%		72.5%			0.4
Commission and brokerage ratio		12.1%		12.4%			(0.3)		11.7%		12.8%			(1.1)
Other underwriting ratio		13.6%		16.0%			(2.4)		14.0%		15.0%			(1.0)
Combined ratio		103.7%		102.2%			1.5		98.7%		100.3%			(1.7)

(Some amounts may not reconcile due to rounding.)
(NM, not meaningful)

Premiums.Gross written premiums increased by 40.4% to $830.7 million for the three months ended September 30, 2021 compared to $591.7 million for the three months ended September 30, 2020. The rise in gross written premiums was primarily due to increases in specialty casualty business, professional liability business and short tail business, including property. Net written premiums increased by 41.6% to $608.2 million for the three months ended September 30, 2021 compared to $429.6 million for the three months ended September 30, 2020, which is consistent with the change in gross written premiums. Premiums earned increased 23.7% to $571.2 million for the three months ended September 30, 2021 compared to $461.7 million for the three months ended September 30, 2020. The change in premiums earned is the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.

Gross written premiums increased by 22.8% to $2,421.7 million for the nine months ended September 30, 2021 compared to $1,971.8 million for the nine months ended September 30, 2020. The rise in gross written premiums was primarily due to increases in specialty casualty business, professional liability business and short tail business, including property, partially offset by a decline in workers’ compensation business. Net written premiums increased by 23.2% to $1,801.9 million for the nine months ended September 30, 2021 compared to $1,462.9 million for the nine months ended September 30, 2020, which is consistent with the change in gross written premiums. Premiums earned increased 14.1% to $1,625.3 million for the nine months ended September 30, 2021 compared to $1,424.8 million for the nine months ended September 30, 2020. The change in premiums earned is the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.

Incurred Losses and LAE.The following tables present the incurred losses and LAE for the Insurance segment for the periods indicated.

Three Months Ended September 30,
Current Ratio %/ Prior Ratio %/ Total Ratio %/
(Dollars in millions) Year Pt Change Years Pt Change Incurred Pt Change
2017

Attritional $ 133.6 87.7 % $ (1.2 ) -0.8 % $ 132.4 86.9 %
Catastrophes 109.6 72.0 % 0.1 0.1 % 109.7 72.1 %
Total segment $ 243.2 159.7 % $ (1.1 ) -0.7 % $ 242.1 159.0 %

2016

Attritional $ 121.4 67.8 % $ 1.1 0.6 % $ 122.5 68.4 %
Catastrophes - 0.0 % - 0.0 % - 0.0 %
Total segment $ 121.4 67.8 % $ 1.1 0.6 % $ 122.5 68.4 %

Variance 2017/2016

Attritional $ 12.2 19.9 pts $ (2.3 ) (1.4 ) pts $ 9.9 18.5 pts
Catastrophes 109.6 72.0 pts 0.1 0.1 pts 109.7 72.1 pts
Total segment $ 121.8 91.9 pts $ (2.2 ) (1.3 ) pts $ 119.6 90.6 pts

Nine Months Ended September 30,
Current Ratio %/ Prior Ratio %/ Total Ratio %/
(Dollars in millions) Year Pt Change Years Pt Change Incurred Pt Change
2017

Attritional $ 321.2 71.4 % $ 6.5 1.4 % $ 327.7 72.8 %
Catastrophes 114.4 25.5 % (0.1 ) 0.0 % 114.3 25.5 %
Total segment $ 435.6 96.9 % $ 6.4 1.4 % $ 442.0 98.3 %

2016

Attritional $ 343.8 77.1 % $ 5.6 1.3 % $ 349.4 78.4 %
Catastrophes 16.7 3.7 % (0.2 ) 0.0 % 16.5 3.7 %
Total segment $ 360.5 80.8 % $ 5.4 1.3 % $ 366.0 82.1 %

Variance 2017/2016

Attritional $ (22.6 ) (5.7 ) pts $ 0.9 0.1 pts $ (21.7 ) (5.6 ) pts
Catastrophes 97.7 21.8 pts 0.1 - pts 97.8 21.8 pts
Total segment $ 75.1 16.1 pts $ 1.0 0.1 pts $ 76.0 16.2 pts

(Some amounts may not reconcile due to rounding.)

	Three Months Ended September 30,
	Current		Ratio %/		Prior		Ratio %/		Total		Ratio %/
(Dollars in millions)	Year		Pt Change		Years		Pt Change		Incurred		Pt Change
2021
Attritional	$	367.9	64.4%		$	-	0.0%		$	367.9	64.4%
Catastrophes		78.4	13.7%			(0.8)	-0.1%			77.6	13.6%
Total segment	$	446.3	78.1%		$	(0.8)	-0.1%		$	445.5	78.0%
2020
Attritional	$	303.7	65.8%		$	-	0.0%		$	303.7	65.8%
Catastrophes		37.5	8.1%			(0.2)	-0.1%			37.3	8.1%
Total segment	$	341.2	73.9%		$	(0.2)	-0.1%		$	340.9	73.8%
Variance 2021/2020
Attritional	$	64.2	(1.4)	pts	$	-	-	pts	$	64.2	(1.4)	pts
Catastrophes		40.9	5.6	pts		(0.6)	-	pts		40.3	5.5	pts
Total segment	$	105.1	4.2	pts	$	(0.6)	-	pts	$	104.5	4.2	pts

	Nine Months Ended September 30,
	Current		Ratio %/		Prior		Ratio %/		Total		Ratio %/
(Dollars in millions)	Year		Pt Change		Years		Pt Change		Incurred		Pt Change
2021
Attritional	$	1,050.5	64.6%		$	(2.0)	-0.1%		$	1,048.5	64.5%
Catastrophes		135.9	8.4%			1.0	0.1%			136.9	8.4%
Total segment	$	1,186.4	73.0%		$	(1.0)	-0.1%		$	1,185.4	72.9%
2020
Attritional	$	976.0	68.5%		$	(0.3)	0.0%		$	975.6	68.5%
Catastrophes		58.0	4.1%			(0.7)	0.0%			57.3	4.0%
Total segment	$	1,034.0	72.6%		$	(1.0)	-0.1%		$	1,032.9	72.5%
Variance 2021/2020
Attritional	$	74.5	(3.9)	pts	$	(1.6)	(0.1)	pts	$	72.9	(4.0)	pts
Catastrophes		77.9	4.3	pts		1.7	0.1	pts		79.6	4.4	pts
Total segment	$	152.5	0.4	pts	$	-	-	pts	$	152.5	0.4	pts

(Some amounts may not reconcile due to rounding.)

Incurred losses and LAE increased by ~~97.6%~~30.6% to ~~$242.1~~$445.5 million for the three months ended September 30, 2021 compared to $340.9 million for the three months ended September 30, 2020, mainly due to an increase of $64.2 million in current year attritional losses primarily related to the impact of the increase in premiums earned and a $40.9 million increase in current year catastrophe losses. The increase in attritional losses was partially offset by $4.0 million of COVID-19 losses incurred in 2020 which did not recur in 2021. The $78.4 million of current year catastrophe losses for the three months ended September 30, 2021, related to Hurricane Ida. The $37.5 million of current year catastrophe losses for the three months ended September 30, ~~201~~7 ~~compared~~2020, related to ~~$122.5~~Hurricane Sally ($16.0 million), Hurricane Laura ($15.0 million), the Calgary storms in Canada ($2.5 million), Hurricane Isaias ($2.0 million) and the Derecho storms ($2.0 million).

Incurred losses and LAE increased by 14.8% to $1,185.4 million for the ~~three~~nine months ended September 30, ~~201~~6,2021 compared to $1,032.9 million for the nine months ended September 30, 2020, mainly due to an increase of ~~$109.6~~$77.9 million in current year catastrophe losses and an increase of ~~$12.2 million in current year attritional losses.~~ ~~The current year catastrophe losses of $109.6 million~~ ~~for the three months ended September 30, 2017 related to Hurricane Harvey ($50.8 million), Hurricane Irma ($50.1 million) and Hurricane Maria ($8.7 million).~~ ~~There were no current year catastrophe losses~~ ~~for the three months ended September 30, 2016.~~

~~Incurred losses and LAE increased by 20.8% to $442.0 million for the nine months ended September 30, 201~~7 ~~compared to $366.0 million for the nine months ended September 30, 201~~6~~, mainly due to an increase of $97.7 million in current catastrophe losses, partially offset by a decrease of $22.6~~$74.5 million in current year attritional losses. The ~~decrease~~rise in current year attritional losses was primarily ~~related~~due to ~~changes in the mix of business and~~ the impact of ~~affiliated quota share agreements.~~ the increase in premiums earned and partially offset by $32.2 million of COVID-19 losses incurred in 2020 which did not recur in 2021. The $135.9 million of current year catastrophe losses ~~of $114.4 million~~ for the nine months ended September 30, ~~2017 primarily~~2021, related to Hurricane ~~Harvey~~Ida ($~~50.8 million), Hurricane Irma ($50.1 million), Hurricane Maria ($8.7~~ 78.4

million) and the ~~2017 US Midwest Storms~~Texas winter storms ($~~4.8~~57.5 million). The ~~$16.7~~$58.0 million of current year catastrophe losses for the nine months ended September 30, ~~2016 were due~~2020, primarily related to ~~the 2016 U.S. storms~~Hurricane Sally ($16.0 million), Hurricane Laura ($15.0 million), the U.S. Civil Unrest ($15.0 million), the Nashville tornadoes ($5.5 million), the Calgary storms in Canada ($2.5 million), the Derecho storms ($2.0 million) and ~~the Fort McMurray Canada wildfire~~Hurricane Isaias ($~~1.7~~2.0 million).

Segment ~~Expenses.~~Expenses. Commission and brokerage ~~decreased~~increased to ~~($22.3)~~$69.1 million for the three months ended September 30, ~~201~~72021 compared to ~~$4.5~~$57.3 million for the three months ended September 30, ~~201~~6.2020. Commission and brokerage ~~decreased~~increased to ~~($40.1)~~$190.3 million for the nine months ended September 30, ~~201~~72021 compared to ~~($10.9)~~$182.9 million for the nine months ended September 30, ~~201~~6.2020. The ~~decreases~~increases were mainly due to the impact of ~~changes~~the increase in premiums earned and expenses related to the ~~mix~~continued build out of ~~business and~~ the ~~impacts from affiliated quota share agreements.~~

insurance business.

Segment other underwriting expenses ~~decreased~~increased to ~~$37.4~~$77.5 million for the three months ended September 30, ~~201~~7 2021 compared to ~~$40.7~~$73.7 million for the three months ended September 30, ~~201~~6. 2020. Segment other underwriting expenses ~~decreased~~increased to ~~$114.9~~$227.9 million for the nine months ended September 30, ~~201~~7 2021 compared to ~~$116.8~~$212.6 million for the nine months ended September 30, ~~2016. These decreases~~2020. The increases were mainly due to ~~lower variable compensation costs.~~

the impact of the increase in premiums earned and expenses related to the continued build out of the insurance business.

Market Sensitive Instruments.

The ~~SEC's~~SEC’s Financial Reporting Release #48 requires registrants to clarify and expand upon the existing financial statement disclosure requirements for derivative financial instruments, derivative commodity instruments and other financial instruments (collectively, ~~"market~~“market sensitive ~~instruments"~~instruments”). We do not generally enter into market sensitive instruments for trading purposes.

Our current investment strategy seeks to maximize after-tax income through a high quality, diversified, taxable and tax-preferenced fixed maturity portfolio, while maintaining an adequate level of liquidity. Our mix of taxable and tax-preferenced investments is adjusted periodically, consistent with our current and projected operating results, market conditions and our tax position. The fixed maturity securities in the investment portfolio are comprised of non-trading available for sale securities. Additionally, we have invested in equity securities.

The overall investment strategy considers the scope of present and anticipated Company operations. In particular, estimates of the financial impact resulting from non-investment asset and liability transactions, together with our capital structure and other factors, are used to develop a net liability analysis. This analysis includes estimated payout characteristics for which our investments provide liquidity. This analysis is considered in the development of specific investment strategies for asset allocation, duration and credit quality. The change in overall market sensitive risk exposure principally reflects the asset changes that took place during the period.

Interest Rate ~~Risk.~~Risk. Our ~~$10.2~~$17.9 billion investment portfolio, at September 30, ~~2017,~~2021, is principally comprised of fixed maturity securities, which are generally subject to interest rate risk and some foreign currency exchange rate risk, and some equity securities, which are subject to price fluctuations and some foreign exchange rate risk. The overall economic impact of the foreign exchange risks on the investment portfolio is partially mitigated by changes in the dollar value of foreign currency denominated liabilities and their associated income statement impact.

Interest rate risk is the potential change in value of the fixed maturity securities portfolio, including short-term investments, from a change in market interest rates. In a declining interest rate environment, it includes prepayment risk on the ~~$736.9~~$1,618.5 million of mortgage-backed securities in the ~~$6,039.4~~$11,897.5 million fixed maturity portfolio. Prepayment risk results from potential accelerated principal payments that shorten the average life and thus the expected yield of the security.

The table below displays the potential impact of market value fluctuations and after-tax unrealized appreciation on our fixed maturity portfolio (including ~~$230.0~~$538.1 million of short-term investments) for the period indicated based on upward and downward parallel and immediate 100 and 200 basis point shifts in interest rates. For legal entities with a U.S. dollar functional currency, this modeling was performed on each security individually. To generate appropriate price estimate on mortgage-backed securities, changes in prepayment expectations under different interest rate environments were taken into account. For legal entities with non-U.S. dollar functional currency, the effective duration of the involved portfolio of securities was used as a proxy for the market value change under the various interest rate change scenarios.

Impact of Interest Rate Shift in Basis Points
At September 30, 2017
(Dollars in millions) -200 -100 0 100 200
Total Market/Fair Value $ 6,634.4 $ 6,454.2 $ 6,269.4 $ 6,077.2 $ 5,883.9
Market/Fair Value Change from Base (%) 5.8 % 2.9 % 0.0 % -3.1 % -6.1 %
Change in Unrealized Appreciation
After-tax from Base ($) $ 237.3 $ 120.1 $ - $ (124.9 ) $ (250.6 )

	Impact of Interest Rate Shift in Basis Points
	At September 30, 2021
(Dollars in millions)	-200		-100		-		100		200
Total Market/Fair Value	$	13,282.2	$	12,858.9	$	12,435.6	$	12,012.3	$	11,589.0
Market/Fair Value Change from Base (%)		6.8%		3.4%		0.0%		-3.4%		-6.8%
Change in Unrealized Appreciation
After-tax from Base ($)	$	668.8	$	334.4	$	-	$	(334.4)	$	(668.8)

We had ~~$9,969.1~~$13,321.8 million and ~~$8,331.3~~$11,654.9 million of gross reserves for losses and LAE as of September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively. These amounts are recorded at their nominal value, as opposed to present value, which would reflect a discount adjustment to reflect the time value of money. Since losses are paid out over a period of time, the present value of the reserves is less than the nominal value. As interest rates rise, the present value of the reserves decreases and, conversely, as interest rates decline, the present value increases. These movements are the opposite of the interest rate impacts on the fair value of investments. While the difference between present value and nominal value is not reflected in our financial statements, our financial results will include investment income over time from the investment portfolio until the claims are paid. Our loss and loss reserve obligations have an expected duration that is reasonably consistent with our fixed income portfolio.

Equity ~~Risk.~~Risk. Equity risk is the potential change in fair and/or market value of the common stock, preferred stock and mutual fund portfolios arising from changing prices. Our equity investments consist of a diversified portfolio of individual securities. The primary objective of the equity portfolio is to obtain greater total return relative to our core bonds over time through market appreciation and income.

The table below displays the impact on fair/market value and after-tax change in fair/market value of a 10% and 20% change in equity prices up and down for the periods indicated.

Impact of Percentage Change in Equity Fair/Market Values
At September 30, 2017
(Dollars in millions) -20% -10% 0% 10% 20%
Fair/Market Value of the Equity Portfolio $ 798.5 $ 898.3 $ 998.1 $ 1,097.9 $ 1,197.7
After-tax Change in Fair/Market Value (129.7 ) (64.9 ) - 64.9 129.7

	Impact of Percentage Change in Equity Fair/Market Values
	At September 30, 2021
(Dollars in millions)	-20%		-10%		0%		10%		20%
Fair/Market Value of the Equity Portfolio	$	1,190.7	$	1,339.5	$	1,488.4	$	1,637.2	$	1,786.0
After-tax Change in Fair/Market Value		(235.2)		(117.6)		-		117.6		235.2

Foreign Currency Risk. Foreign currency risk is the potential change in value, income and cash flow arising from adverse changes in foreign currency exchange rates. Each of our non-U.S. ~~("foreign"~~(“foreign”) operations maintains capital in the currency of the country of its geographic location consistent with local regulatory guidelines. Each foreign operation may conduct business in its local currency, as well as the currency of other countries in which it operates. The primary foreign currency exposures for these foreign operations are the Singapore and Canadian Dollars. We mitigate foreign exchange exposure by generally matching the currency and duration of our assets to our corresponding operating liabilities. In accordance with FASB guidance, the impact on the market value of available for sale fixed maturities due to changes in foreign currency exchange rates, in relation to functional currency, is reflected as part of other comprehensive income. Conversely, the impact of changes in foreign currency exchange rates, in relation to functional currency, on other assets and liabilities is reflected through net income as a component of other income (expense). In addition, we translate the assets, liabilities and income of non-U.S. dollar functional currency legal entities to the U.S. dollar. This translation amount is reported as a component of other comprehensive income.

SAFE HARBOR DISCLOSURE

This report contains forward-looking statements within the meaning of the U.S. federal securities laws. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the federal securities laws. In some cases, these statements can be identified by the use of forward-looking words such as ~~"may"~~“may”, ~~"will"~~“will”, ~~"should"~~“should”, ~~"could"~~“could”, ~~"anticipate"~~“anticipate”, ~~"estimate"~~“estimate”, ~~"expect"~~“expect”, ~~"plan"~~“plan”, ~~"believe"~~“believe”, ~~"predict"~~“predict”, ~~"potential"~~“potential” and ~~"intend"~~“intend”. Forward-looking statements contained in this report include information regarding our reserves for losses and LAE, the CARES Act, the impact of the TCJA, the adequacy of our provision for uncollectible balances, estimates of our catastrophe exposure, the effects of catastrophic and pandemic events on our financial statements and the ability of our subsidiaries to pay dividends. Forward-looking statements only reflect our expectations and are not guarantees of performance. These statements involve risks, uncertainties and assumptions. Actual events or results may differ materially from our expectations. Important factors that could cause our actual events or results to be materially different from our expectations include those discussed under the caption ITEM 1A, ~~"Risk Factors"~~“Risk Factors” in the ~~Company's~~Company’s most recent 10-K filing. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market Risk Instruments. See ~~"Market~~“Market Sensitive ~~Instruments"~~Instruments” in PART I – ITEM 2.

ITEM 4. CONTROLS AND PROCEDURES

As of the end of the period covered by this report, our management carried out an evaluation, with the participation of the Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the ~~"Exchange Act"~~“Exchange Act”)). Based on their evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the

reports that we file or submit under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange ~~Commission's~~Commission’s rules and forms. Our management, with the participation of the Chief Executive Officer and Chief Financial Officer, also conducted an evaluation of our internal control over financial reporting to determine whether any changes occurred during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Based on that evaluation, there has been no such change during the quarter covered by this report.

PART II

ITEM 1. LEGAL PROCEEDINGS

In the ordinary course of business, the Company is involved in lawsuits, arbitrations and other formal and informal dispute resolution procedures, the outcomes of which will determine the ~~Company's~~Company’s rights and obligations under insurance and reinsurance agreements. In some disputes, the Company seeks to enforce its rights under an agreement or to collect funds owing to it. In other matters, the Company is resisting attempts by others to collect funds or enforce alleged rights. These disputes arise from time to time and are ultimately resolved through both informal and formal means, including negotiated resolution, arbitration and litigation. In all such matters, the Company believes that its positions are legally and commercially reasonable. The Company considers the statuses of these proceedings when determining its reserves for unpaid loss and loss adjustment expenses.

Aside from litigation and arbitrations related to these insurance and reinsurance agreements, the Company is not a party to any other material litigation or arbitration.

ITEM 1A. RISK FACTORS

No material changes.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

~~None.~~

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

~~None.~~

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

~~None.~~

ITEM 6. EXHIBITS

Exhibit Index:

Exhibit No.	Description

31.1	Section 302 Certification of ~~Dominic J. Addesso~~	Juan C. Andrade

31.2	Section 302 Certification of ~~Craig Howie~~	Mark Kociancic

32.1	Section 906 Certification of ~~Dominic J. Addesso~~Juan C. Andrade and ~~Craig Howie~~	Mark Kociancic

101.INS	XBRL Instance Document

101.SCH	XBRL Taxonomy Extension Schema

101.CAL	XBRL Taxonomy Extension Calculation Linkbase

101.DEF	XBRL Taxonomy Extension Definition Linkbase

101.LAB	XBRL Taxonomy Extension Labels Linkbase

101.PRE	XBRL Taxonomy Extension Presentation Linkbase

104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

Everest Reinsurance Holdings, Inc.

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	Everest Reinsurance Holdings, Inc.
~~(Registrant)~~	(Registrant)


	/S/ ~~CRAIG HOWIE~~MARK KOCIANCIC
~~Craig Howie~~	Mark Kociancic
	Executive Vice President and
		Chief Financial Officer

	(Duly Authorized Officer and Principal Financial Officer)



Dated: November 10, 2021

~~Dated: November 14, 2017~~

Delaware		22-3263609
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Large accelerated filer☐			Accelerated filer	☐
Non-accelerated ~~filer~~ Filer ☑	X		Smaller reporting company	☐
~~(Do not check if smaller reporting company)~~		Emerging growth company	☐

		Number of Shares Outstanding
Class		At November 1, ~~2017~~ 2021
Common Shares, $0.01 par value		1,000

			Page
~~Item 1.~~				~~Financial Statements~~	PART I

FINANCIAL INFORMATION

Item 1.	Financial Statements

	Consolidated Balance Sheets atas of September 30, ~~2017~~2021 (unaudited) and December 31, 2020	1
		~~December 31, 2016 (unaudited)~~	1

	Consolidated Statements of Operations and Comprehensive Income (Loss) for the
		three and nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 (unaudited)	2

	Consolidated Statements of Changes in ~~Stockholder's~~Stockholder’s Equity for the ~~three and~~
		nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 (unaudited)	3

	Consolidated Statements of Cash Flows for the nine months ended September 30, 2021 and 2020 (unaudited)	4
		~~September 30, 2017 and 2016 (unaudited)~~	4

	Notes to Consolidated Interim Financial Statements (unaudited)		5

Item 2.	~~Management's~~ Management’s Discussion and Analysis of Financial Condition and
		Results of Operation	34 31

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	51 47

Item 4.	Controls and Procedures	51 47


~~Item 1.~~			~~Legal Proceedings~~	51 PART II

~~Item 1A.~~			~~Risk Factors~~	52 OTHER INFORMATION

Item 1.	Legal Proceedings	48

Item 1A.	Risk Factors	48

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	52 48

Item 3.	Defaults Upon Senior Securities	52 48

Item 4.	Mine Safety Disclosures	52 48

Item 5.	Other Information	52 48

Item 6.	Exhibits	52 49


(Dollars in thousands, except share amounts and par value per share)	September 30, 2021		December 31, 2020
	(unaudited)
ASSETS:
Fixed maturities – available for sale, at market value (amortized cost: 2021, $11,658,597; 2020, $10,248,650, allowances for credit losses: 2021, $(31,113); 2020, $(1,566))	$	11,897,480	$	10,643,565
Equity securities, at fair value		1,488,355		1,288,767
Short-term investments (cost: 2021, $538,094; 2020, $708,043)		538,094		707,905
Other invested assets		1,626,435		1,094,933
Other invested assets, at fair value		1,933,277		1,796,479
Cash		453,090		378,518
Total investments and cash		17,936,731		15,910,167
Note Receivable - affiliated		500,000		300,000
Accrued investment income		110,188		80,196
Premiums receivable		1,852,973		1,591,980
Reinsurance recoverables - unaffiliated		1,662,942		1,505,650
Reinsurance recoverables - affiliated		2,371,998		2,701,655
Funds held by reinsureds		295,473		267,599
Deferred acquisition costs		443,973		379,707
Prepaid reinsurance premiums		444,768		363,489
Other assets		717,167		616,640
TOTAL ASSETS	$	26,336,213		23,717,083

LIABILITIES:
Reserve for losses and loss adjustment expenses	$	13,321,811	$	11,654,950
Unearned premium reserve		2,914,338		2,385,174
Funds held under reinsurance treaties		48,922		46,894
Other net payable to reinsurers		428,985		277,390
Losses in course of payment		150,028		161,154
Income taxes net payable		251,609		192,877
Senior notes due 6/1/2044		397,284		397,194
Senior notes due 10/15/2050		979,915		979,524
Long term notes due 5/1/2067		223,749		223,674
Borrowings from FHLB		310,000		310,000
Accrued interest on debt and borrowings		23,267		10,460
Unsettled securities payable		64,984		206,693
Other liabilities		463,543		456,786
Total liabilities		19,578,435		17,302,770
Commitments and Contingencies (Note 6)		(nil)		(nil)

STOCKHOLDER'S EQUITY:
Common shares, par value: $0.01; 3,000 shares authorized; 1,000 shares issued and outstanding (2021 and 2020)		-		-
Additional paid-in capital		1,101,425		1,101,092
Accumulated other comprehensive income (loss), net of deferred income tax expense (benefit) $44,898 at 2021 and $71,080 at 2020		169,214		268,018
Retained earnings		5,487,139		5,045,203
Total stockholder's equity		6,757,778		6,414,313
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY	$	26,336,213	$	23,717,083

The accompanying notes are an integral part of the consolidated financial statements.

	September 30,			December 31,
(Dollars in thousands, except par value per share)	2017			2016
	(unaudited)
ASSETS:
Fixed maturities - available for sale, at market value	$	6,039,361		$	5,970,496
(amortized cost: 2017, $5,974,256; 2016, $5,910,494)
Equity securities - available for sale, at fair value		998,071			887,800
Short-term investments		229,999			306,286
Other invested assets (cost: 2017, $736,566; 2016, $613,680)		739,486			613,740
Other invested assets, at fair value		1,922,402			1,766,626
Cash		302,331			297,794
Total investments and cash		10,231,650			9,842,742
Note receivable - affiliated		250,000			250,000
Accrued investment income		45,575			45,323
Premiums receivable		1,564,491			1,128,639
Reinsurance receivables - unaffiliated		1,116,370			887,657
Reinsurance receivables - affiliated		4,137,998			3,686,130
Funds held by reinsureds		204,989			190,421
Deferred acquisition costs		65,519			68,621
Prepaid reinsurance premiums		1,115,344			781,384
Other assets		411,425			202,519
TOTAL ASSETS	$	19,143,361		$	17,083,436

LIABILITIES:
Reserve for losses and loss adjustment expenses	$	9,969,148		$	8,331,288
Unearned premium reserve		1,628,717			1,312,386
Funds held under reinsurance treaties		125,463			110,836
Losses in the course of payment		193,948			82,915
Commission reserves		24,932			52,037
Other net payable to reinsurers		1,158,259			815,298
4.868% Senior notes due 6/1/2044		396,804			396,714
6.6% Long term notes due 5/1/2067		236,536			236,462
Accrued interest on debt and borrowings		7,564			3,537
Income taxes		(29,533	)		148,940
Unsettled securities payable		39,660			27,121
Other liabilities		224,219			267,349
Total liabilities		13,975,717			11,784,883

Commitments and Contingencies (Note 7)

STOCKHOLDER'S EQUITY:
Common stock, par value: $0.01; 3,000 shares authorized;
1,000 shares issued and outstanding (2017 and 2016)		-			-
Additional paid-in capital		387,772			387,567
Accumulated other comprehensive income (loss), net of deferred income tax expense
(benefit) of $9,405 at 2017 and ($19,549) at 2016		17,459			(36,315	)
Retained earnings		4,762,413			4,947,301
Total stockholder's equity		5,167,644			5,298,553
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY	$	19,143,361		$	17,083,436

The accompanying notes are an integral part of the consolidated financial statements.

CONSOLIDATED BALANCE SHEETS	March 31, 2017
	As Previously		Impact of
	Reported		Revisions			As Revised
(Dollars in thousands, except par value per share)
ASSETS:
Deferred acquisition costs	$	62,308	$	(4,994	)	$	57,314
TOTAL ASSETS	$	17,587,840	$	(4,994	)	$	17,582,846

LIABILITIES:
Other net payable to reinsurers	$	832,307	$	(41,746	)	$	790,561
Income taxes		223,629		5,625			229,254
Total liabilities		12,139,623		(36,121	)		12,103,502

STOCKHOLDERS EQUITY:
Retained earnings		5,085,352		31,127			5,116,479
Total stockholder's equity		5,448,217		31,127			5,479,344
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY	$	17,587,840	$	(4,994	)	$	17,582,846

CONSOLIDATED BALANCE SHEETS	December 31, 2016							December 31, 2015
	As Previously		Impact of					As Previously		Impact of
	Reported		Revisions			As Revised		Reported		Revisions			As Revised
(Dollars in thousands, except par value per share)
ASSETS:
Deferred acquisition costs	$	73,924	$	(5,303	)	$	68,621	$	92,651	$	(6,249	)	$	86,402
TOTAL ASSETS	$	17,088,739	$	(5,303	)	$	17,083,436	$	16,695,203	$	(6,249	)	$	16,688,954

LIABILITIES:
Other net payable to reinsurers	$	860,391	$	(45,093	)	$	815,298	$	1,225,260	$	(37,480	)	$	1,187,780
Income taxes		142,143		6,797			148,940		68,024		4,132			72,156
Total liabilities		11,823,179		(38,296	)		11,784,883		11,763,992		(33,348	)		11,730,644

STOCKHOLDERS EQUITY:
Retained earnings		4,914,308		32,993			4,947,301		4,618,558		27,099			4,645,657
Total stockholder's equity		5,265,560		32,993			5,298,553		4,931,211		27,099			4,958,310
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY	$	17,088,739	$	(5,303	)	$	17,083,436	$	16,695,203	$	(6,249	)	$	16,688,954

CONSOLIDATED STATEMENTS OF OPERATIONS	Year Ended December 31, 2016							Year Ended December 31, 2015
AND COMPREHENSIVE INCOME (LOSS):	As Previously		Impact of					As Previously		Impact of
	Reported		Revisions			As Revised		Reported		Revisions			As Revised
(Dollars in thousands)
CLAIMS AND EXPENSES:
Commission, brokerage, taxes and fees	$	289,982	$	(8,558	)	$	281,424	$	315,069	$	(2,744	)	$	312,325
Total claims and expenses		1,928,940		(8,558	)		1,920,382		1,892,062		(2,744	)		1,889,318

INCOME (LOSS) BEFORE TAXES		390,433		8,558			398,991		604,542		2,744			607,286
Income tax expense (benefit)		94,683		2,664			97,347		191,889		3,007			194,896

NET INCOME (LOSS)	$	295,750	$	5,894		$	301,644	$	412,653	$	(263	)	$	412,390

COMPREHENSIVE INCOME (LOSS)	$	321,571	$	5,894		$	327,465	$	345,998	$	(263	)	$	345,735

CONSOLIDATED STATEMENTS OF OPERATIONS	Year Ended December 31, 2014							Three Months Ended March 31, 2017
AND COMPREHENSIVE INCOME (LOSS):	As Previously		Impact of					As Previously		Impact of
	Reported		Revisions			As Revised		Reported		Revisions			As Revised
(Dollars in thousands)
CLAIMS AND EXPENSES:
Commission, brokerage, taxes and fees	$	339,402	$	(427	)	$	338,975	$	49,470	$	3,037		$	52,507
Total claims and expenses		1,930,749		(427	)		1,930,322		411,543		3,037			414,580

INCOME (LOSS) BEFORE TAXES		657,688		427			658,115		247,984		(3,037	)		244,947
Income tax expense (benefit)		203,562		1,125			204,687		76,940		(1,171	)		75,769

NET INCOME (LOSS)	$	454,126	$	(698	)	$	453,428	$	171,044	$	(1,866	)	$	169,178

COMPREHENSIVE INCOME (LOSS)	$	370,997	$	(698	)	$	370,299	$	182,587	$	(1,866	)	$	180,721

CONSOLIDATED STATEMENTS OF OPERATIONS	Three Months Ended September 30, 2016							Nine Months Ended September 30, 2016
AND COMPREHENSIVE INCOME (LOSS):	As Previously		Impact of					As Previously		Impact of
	Reported		Revisions			As Revised		Reported		Revisions			As Revised
(Dollars in thousands)
CLAIMS AND EXPENSES:
Commission, brokerage, taxes and fees	$	85,563	$	(2,785	)	$	82,778	$	226,511	$	(6,959	)	$	219,552
Total claims and expenses		462,009		(2,785	)		459,224		1,377,175		(6,959	)		1,370,216

INCOME (LOSS) BEFORE TAXES		95,943		2,785			98,728		249,064		6,959			256,023
Income tax expense (benefit)		21,145		1,280			22,425		66,990		2,368			69,358

NET INCOME (LOSS)	$	74,798	$	1,505		$	76,303	$	182,074	$	4,591		$	186,665

COMPREHENSIVE INCOME (LOSS)	$	74,465	$	1,505		$	75,970	$	299,559	$	4,591		$	304,150

CONSOLIDATED STATEMENTS OF OPERATIONS	Three Months Ended June 30, 2016							Six Months Ended June 30, 2016
AND COMPREHENSIVE INCOME (LOSS):	As Previously		Impact of					As Previously		Impact of
	Reported		Revisions			As Revised		Reported		Revisions			As Revised
(Dollars in thousands)
CLAIMS AND EXPENSES:
Commission, brokerage, taxes and fees	$	72,126	$	(1,717	)	$	70,409	$	140,948	$	(4,174	)	$	136,774
Total claims and expenses		479,860		(1,717	)		478,143		915,166		(4,174	)		910,992

INCOME (LOSS) BEFORE TAXES		101,332		1,717			103,049		153,121		4,174			157,295
Income tax expense (benefit)		32,982		695			33,677		45,845		1,088			46,933

NET INCOME (LOSS)	$	68,350	$	1,022		$	69,372	$	107,276	$	3,086		$	110,362

COMPREHENSIVE INCOME (LOSS)	$	124,381	$	1,022		$	125,403	$	225,094	$	3,086		$	228,180

CONSOLIDATED STATEMENTS OF OPERATIONS	Three Months Ended March 31, 2016
AND COMPREHENSIVE INCOME (LOSS):	As Previously		Impact of
	Reported		Revisions			As Revised
(Dollars in thousands)
CLAIMS AND EXPENSES:
Commission, brokerage, taxes and fees	$	68,822	$	(2,457	)	$	66,365
Total claims and expenses		435,306		(2,457	)		432,849

INCOME (LOSS) BEFORE TAXES		51,789		2,457			54,246
Income tax expense (benefit)		12,863		393			13,256

NET INCOME (LOSS)	$	38,926	$	2,064		$	40,990

COMPREHENSIVE INCOME (LOSS)	$	100,713	$	2,064		$	102,777

CONSOLIDATED STATEMENTS OF	Year Ended December 31, 2016						Year Ended December 31, 2015
CHANGES IN STOCKHOLDER'S EQUITY	As Previously		Impact of				As Previously		Impact of
	Reported		Revisions		As Revised		Reported		Revisions			As Revised

(Dollars in thousands, except share amounts)
RETAINED EARNINGS:
Balance, beginning of period	$	4,618,558	$	27,099	$	4,645,657	$	4,205,905	$	27,362		$	4,233,267
Net income (loss)		295,750		5,894		301,644		412,653		(263	)		412,390
Balance, end of period		4,914,308		32,993		4,947,301		4,618,558		27,099			4,645,657
TOTAL STOCKHOLDER'S EQUITY, END OF PERIOD	$	5,265,560	$	32,993	$	5,298,553	$	4,931,211	$	27,099		$	4,958,310

CONSOLIDATED STATEMENTS OF CASH FLOWS	Year Ended December 31, 2016									Year Ended December 31, 2015
	As Previously			Impact of						As Previously		Impact of
	Reported			Revisions			As Revised			Reported		Revisions			As Revised
(Dollars in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	295,750		$	5,894		$	301,644		$	412,653	$	(263	)	$	412,390
Decrease (increase) in income taxes		60,325			2,666			62,991			57,487		3,007			60,494
Increase (decrease) in other net payable to reinsurers		(364,242	)		(7,614	)		(371,856	)		204,526		(8,590	)		195,936
Change in other assets and liabilities, net		16,090			(946	)		15,144			7,499		5,846			13,345

	At September 30, 2017
	Amortized		Unrealized		Unrealized			Market		OTTI in AOCI
(Dollars in thousands)	Cost		Appreciation		Depreciation			Value		(a)
Fixed maturity securities
U.S. Treasury securities and obligations of
U.S. government agencies and corporations	$	657,018	$	2,088	$	(3,220	)	$	655,886	$	-
Obligations of U.S. states and political subdivisions		652,525		24,061		(4,744	)		671,842		-
Corporate securities		2,213,498		38,058		(11,965	)		2,239,591		695
Asset-backed securities		153,400		451		(62	)		153,789		-
Mortgage-backed securities
Commercial		59,311		334		(622	)		59,023		-
Agency residential		683,178		1,904		(7,252	)		677,830		-
Non-agency residential		55		7		-			62		-
Foreign government securities		520,431		19,038		(7,996	)		531,473		-
Foreign corporate securities		1,034,840		25,601		(10,576	)		1,049,865		374
Total fixed maturity securities	$	5,974,256	$	111,542	$	(46,437	)	$	6,039,361	$	1,069

	At December 31, 2016
	Amortized		Unrealized		Unrealized			Market		OTTI in AOCI
(Dollars in thousands)	Cost		Appreciation		Depreciation			Value		(a)
Fixed maturity securities
U.S. Treasury securities and obligations of
U.S. government agencies and corporations	$	693,005	$	2,509	$	(4,434	)	$	691,080	$	-
Obligations of U.S. states and political subdivisions		723,938		18,016		(11,970	)		729,984		-
Corporate securities		2,119,324		50,665		(15,786	)		2,154,203		4,868
Asset-backed securities		136,826		330		(129	)		137,027		-
Mortgage-backed securities
Commercial		75,435		510		(452	)		75,493		-
Agency residential		721,772		2,365		(8,993	)		715,144		-
Non-agency residential		76		12		-			88		-
Foreign government securities		495,572		22,088		(10,383	)		507,277		-
Foreign corporate securities		944,546		30,015		(14,361	)		960,200		175
Total fixed maturity securities	$	5,910,494	$	126,510	$	(66,508	)	$	5,970,496	$	5,043

	Nine Months Ended			Twelve Months Ended
	September 30,			At December 31,
(Dollars in thousands)	2017			2016
Gross reserves at beginning of period	$	8,331,288		$	7,940,720
Less reinsurance recoverables		(4,199,791	)		(3,875,073	)
Net reserves at beginning of period		4,131,497			4,065,647

Incurred related to:
Current year		1,918,055			1,441,962
Prior years		453			(91,682	)
Total incurred losses and LAE		1,918,508			1,350,280

Paid related to:
Current year		441,480			400,489
Prior years		547,176			892,207
Total paid losses and LAE		988,656			1,292,696

Foreign exchange/translation adjustment		19,084			8,266

Net reserves at end of period		5,080,433			4,131,497
Plus reinsurance recoverables		4,888,715			4,199,791
Gross reserves at end of period	$	9,969,148		$	8,331,288

	Three Months Ended September 30, 2017								Nine Months Ended September 30, 2017
	Corporate		Foreign						Corporate		Foreign
(Dollars in thousands)	Securities		Corporate			Total			Securities		Corporate			Total
Beginning balance	$	86,140	$	3,151		$	89,291		$	65,197	$	2,538		$	67,735
Total gains or (losses) (realized/unrealized)
Included in earnings		283		210			493			1,208		314			1,522
Included in other comprehensive income (loss)		18		(230	)		(212	)		161		(230	)		(69	)
Purchases, issuances and settlements		15,628		-			15,628			35,503		509			36,012
Transfers in and/or (out) of Level 3		-		-			-			-		-			-
Ending balance	$	102,069	$	3,131		$	105,200		$	102,069	$	3,131		$	105,200

The amount of total gains or losses for the period included
in earnings (or changes in net assets) attributable to the
change in unrealized gains or losses relating to assets
still held at the reporting date	$	-	$	-		$	-		$	-	$	-		$	-

(Some amounts may not reconcile due to rounding.)

	At September 30,		At December 31,
(Dollars in thousands)	2017		2016
The Prudential	$	144,331	$	146,507
Unaffiliated life insurance company		33,769		33,860

	Three Months Ended					Nine Months Ended
U.S. Reinsurance	September 30,					September 30,
(Dollars in thousands)	2017			2016		2017			2016
Gross written premiums	$	908,346		$	654,770	$	1,962,297		$	1,597,006
Net written premiums		295,645			327,242		649,883			711,700

Premiums earned	$	242,350		$	249,203	$	652,953		$	709,064
Incurred losses and LAE		678,926			137,245		919,107			363,567
Commission and brokerage		31,698			48,107		115,243			147,968
Other underwriting expenses		12,094			14,265		40,623			39,856
Underwriting gain (loss)	$	(480,368	)	$	49,586	$	(422,020	)	$	157,673

	Three Months Ended					Nine Months Ended
International	September 30,					September 30,
(Dollars in thousands)	2017			2016		2017			2016
Gross written premiums	$	363,186		$	353,195	$	975,296		$	939,851
Net written premiums		130,180			141,295		345,387			353,449

Premiums earned	$	123,915		$	128,358	$	355,366		$	372,816
Incurred losses and LAE		410,543			41,830		557,416			206,672
Commission and brokerage		25,101			30,193		72,426			82,443
Other underwriting expenses		8,241			9,219		26,293			25,011
Underwriting gain (loss)	$	(319,970	)	$	47,116	$	(300,769	)	$	58,690

	Three Months Ended						Nine Months Ended
Everest International	September 30,						September 30,
(Dollars in thousands)	2017			2016			2017			2016
Ceded written premiums	$	21		$	(5	)	$	(4	)	$	26
Ceded earned premiums		38			(3	)		13			36
Ceded losses and LAE		(13	)		479			(631	)		1,377

Pension Benefits	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(Dollars in thousands)	2017			2016			2017			2016
Service cost	$	2,737		$	2,731		$	9,335		$	8,524
Interest cost		2,509			2,371			7,060			7,093
Expected return on plan assets		(3,263	)		(2,789	)		(9,572	)		(7,757	)
Amortization of net (income) loss		2,091			1,984			8,172			6,012
Net periodic benefit cost	$	4,074		$	4,297		$	14,995		$	13,872

Other Benefits	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(Dollars in thousands)	2017			2016			2017			2016
Service cost	$	392		$	354		$	1,273		$	1,230
Interest cost		295			252			793			844
Amortization of prior service cost		(33	)		(33	)		(98	)		(33	)
Amortization of net (income) loss		48			-			199			96
Net periodic benefit cost	$	703		$	573		$	2,167		$	2,137

(Some amounts may not reconcile due to rounding.)