Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Feb. 19, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2020 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-16533 | ||
Entity Registrant Name | ProAssurance Corporation | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 63-1261433 | ||
Entity Address, Address Line One | 100 Brookwood Place, | ||
Entity Address, City or Town | Birmingham, | ||
Entity Address, State or Province | AL | ||
Entity Address, Postal Zip Code | 35209 | ||
City Area Code | (205) | ||
Local Phone Number | 877-4400 | ||
Title of 12(b) Security | Common Stock, par value $0.01 per share | ||
Trading Symbol | PRA | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 770,102,748 | ||
Entity Common Stock, Shares Outstanding (in shares) | 53,893,267 | ||
Documents Incorporated by Reference | The definitive proxy statement for the 2021 Annual Meeting of the Stockholders of ProAssurance Corporation (File No. 001-16533) is incorporated by reference into Part III of this report. | ||
Entity Central Index Key | 0001127703 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Investments | ||
Fixed maturities, available-for-sale, at fair value (amortized cost, $2,361,575 and $2,241,304, respectively; allowance for expected credit losses, $552 as of current period end) | $ 2,457,531 | $ 2,288,785 |
Fixed maturities, trading, at fair value (cost, $47,907 and $46,772, respectively) | 48,456 | 47,284 |
Equity investments, at fair value (cost, $113,709 and $227,873, respectively) | 120,101 | 250,552 |
Short-term investments | 337,813 | 339,907 |
Business owned life insurance | 67,847 | 66,112 |
Investment in unconsolidated subsidiaries | 310,529 | 358,820 |
Other investments (at fair value, $44,116 and $36,018, respectively, otherwise at cost or amortized cost) | 47,068 | 38,949 |
Total Investments | 3,389,345 | 3,390,409 |
Cash and cash equivalents | 215,782 | 175,369 |
Premiums receivable, net | 201,395 | 249,540 |
Receivable from reinsurers on paid losses and loss adjustment expenses | 14,370 | 12,739 |
Receivable from reinsurers on unpaid losses and loss adjustment expenses | 385,087 | 390,708 |
Prepaid reinsurance premiums | 35,885 | 42,796 |
Deferred policy acquisition costs | 47,196 | 55,567 |
Deferred tax asset, net | 57,105 | 44,387 |
Real estate, net | 30,529 | 30,410 |
Operating lease ROU assets | 19,013 | 21,074 |
Intangible assets, net | 65,720 | 70,757 |
Goodwill | 49,610 | 210,725 |
Other assets | 143,766 | 111,118 |
Total Assets | 4,654,803 | 4,805,599 |
Policy liabilities and accruals | ||
Reserve for losses and loss adjustment expenses | 2,417,179 | 2,346,526 |
Unearned premiums | 361,547 | 413,086 |
Reinsurance premiums payable | 39,998 | 52,946 |
Total Policy Liabilities | 2,818,725 | 2,812,558 |
Operating lease liabilities | 20,116 | 22,051 |
Other liabilities | 182,039 | 173,256 |
Debt less unamortized debt issuance costs | 284,713 | 285,821 |
Total Liabilities | 3,305,593 | 3,293,686 |
Shareholders' Equity | ||
Common shares (par value $0.01 per share, 100,000,000 shares authorized, 63,217,708 and 63,117,235 shares issued, respectively) | 632 | 631 |
Additional paid-in capital | 388,150 | 384,551 |
Accumulated other comprehensive income (loss) (net of deferred tax expense (benefit) of $19,386 and $9,795, respectively) | 75,227 | 36,955 |
Retained earnings | 1,301,163 | 1,505,738 |
Treasury shares, at cost (9,325,180 shares as of each respective period end) | (415,962) | (415,962) |
Total Shareholders’ Equity | 1,349,210 | 1,511,913 |
Total Liabilities and Shareholders' Equity | $ 4,654,803 | $ 4,805,599 |
Treasury Stock, Shares | 9,325,180 | 9,325,180 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Fixed maturities, available for sale, at fair value; amortized cost | $ 2,361,575 | $ 2,241,304 |
Allowance for Expected Credit Losses | 552 | 0 |
Fixed maturities, trading, at fair value; cost | 47,907 | 46,772 |
Equity Investments, fair value, cost | 113,709 | 227,873 |
Other investments, fair value disclosure | $ 44,116 | $ 36,018 |
Common shares, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common shares, shares issued (in shares) | 63,217,708 | 63,117,235 |
Deferred tax expense (benefit) on accumulated other comprehensive income (loss) | $ 19,386 | $ 9,795 |
Treasury shares, number of shares (in shares) | 9,325,180 | 9,325,180 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Capital - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | $ 1,511,913 | $ 1,523,002 | $ 1,594,795 | ||
Common shares issued for compensation and effect of shares reissued to stock purchase plan | 691 | 350 | 1,044 | ||
Share-based compensation | 3,845 | 3,512 | 5,258 | ||
Net effect of restricted and performance shares issued | (936) | (2,708) | (3,934) | ||
Dividends to shareholders | (24,772) | (66,669) | (94,314) | ||
Other comprehensive income (loss) | 38,272 | 53,866 | (35,238) | ||
Net income (loss) | (175,727) | 1,004 | 47,057 | ||
Ending balance | 1,349,210 | $ 1,511,913 | $ 1,523,002 | ||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member | us-gaap:AccountingStandardsUpdate201807Member | |||
Cumulative Effect, Period of Adoption, Adjustment | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | (4,076) | [1] | $ (444) | $ 3,416 | |
Ending balance | (4,076) | [1] | (444) | ||
Accounting Standards Update 2016-01 | Cumulative Effect, Period of Adoption, Adjustment | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | 8,334 | ||||
Accounting Standards Update 2018-02 | Cumulative Effect, Period of Adoption, Adjustment | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | 0 | ||||
Common Stock | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | 631 | 630 | 628 | ||
Net effect of restricted and performance shares issued | 1 | 1 | 2 | ||
Ending balance | 632 | 631 | 630 | ||
Additional Paid-in Capital | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | 384,551 | 384,713 | 383,077 | ||
Common shares issued for compensation and effect of shares reissued to stock purchase plan | 691 | (965) | 314 | ||
Share-based compensation | 3,845 | 3,512 | 5,258 | ||
Net effect of restricted and performance shares issued | (937) | (2,709) | (3,936) | ||
Ending balance | 388,150 | 384,551 | 384,713 | ||
Accumulated Other Comprehensive Income (Loss) | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | 36,955 | (16,911) | 14,911 | ||
Other comprehensive income (loss) | 38,272 | 53,866 | (35,238) | ||
Ending balance | 75,227 | 36,955 | (16,911) | ||
Accumulated Other Comprehensive Income (Loss) | Accounting Standards Update 2018-02 | Cumulative Effect, Period of Adoption, Adjustment | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | 3,416 | ||||
Retained Earnings | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | 1,505,738 | 1,571,847 | 1,614,186 | ||
Dividends to shareholders | (24,772) | (66,669) | (94,314) | ||
Net income (loss) | (175,727) | 1,004 | 47,057 | ||
Ending balance | 1,301,163 | 1,505,738 | 1,571,847 | ||
Retained Earnings | Cumulative Effect, Period of Adoption, Adjustment | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | (4,076) | [1] | (444) | ||
Ending balance | (4,076) | [1] | (444) | ||
Retained Earnings | Accounting Standards Update 2016-01 | Cumulative Effect, Period of Adoption, Adjustment | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | 8,334 | ||||
Retained Earnings | Accounting Standards Update 2018-02 | Cumulative Effect, Period of Adoption, Adjustment | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | (3,416) | ||||
Treasury Stock | |||||
Increase (Decrease) in Stockholders' Equity: | |||||
Beginning balance | (415,962) | (417,277) | (418,007) | ||
Common shares issued for compensation and effect of shares reissued to stock purchase plan | 1,315 | 730 | |||
Ending balance | $ (415,962) | $ (415,962) | $ (417,277) | ||
[1] | See Note 1 of the Notes to Consolidated Financial Statements for discussion of accounting guidance adopted during the year. |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income - USD ($) shares in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues | |||
Net premiums earned | $ 792,715,000 | $ 847,532,000 | $ 818,853,000 |
Net investment income | 71,998,000 | 93,269,000 | 91,884,000 |
Equity in earnings (loss) of unconsolidated subsidiaries | (11,921,000) | (10,061,000) | 8,948,000 |
Net realized investment gains (losses): | |||
Impairment losses | (1,745,000) | (978,000) | (490,000) |
Portion of impairment losses recognized in other comprehensive income (loss) before taxes | 237,000 | 227,000 | 0 |
Net impairment losses recognized in earnings | (1,508,000) | (751,000) | (490,000) |
Other net realized investment gains (losses) | 17,186,000 | 60,625,000 | (42,998,000) |
Total net realized investment gains (losses) | 15,678,000 | 59,874,000 | (43,488,000) |
Other income | 6,470,000 | 9,220,000 | 9,833,000 |
Total revenues | 874,940,000 | 999,834,000 | 886,030,000 |
Expenses | |||
Net losses and loss adjustment expenses | 661,447,000 | 753,915,000 | 593,210,000 |
Underwriting, policy acquisition and operating expenses: | |||
Operating expense | 127,316,000 | 137,119,000 | 133,689,000 |
DPAC amortization | 110,565,000 | 115,330,000 | 104,501,000 |
SPC U.S. federal income tax expense | 1,746,000 | 1,059,000 | 366,000 |
SPC dividend expense (income) | 14,304,000 | 4,579,000 | 9,122,000 |
Interest expense | 15,503,000 | 16,636,000 | 16,117,000 |
Goodwill impairment | 161,115,000 | 0 | 0 |
Total expenses | 1,091,996,000 | 1,028,638,000 | 857,005,000 |
Income (loss) before income taxes | (217,056,000) | (28,804,000) | 29,025,000 |
Provision for income taxes: | |||
Current expense (benefit) | (20,181,000) | (1,165,000) | (6,208,000) |
Deferred expense (benefit) | (21,148,000) | (28,643,000) | (11,824,000) |
Total income tax expense (benefit) | (41,329,000) | (29,808,000) | (18,032,000) |
Net income (loss) | (175,727,000) | 1,004,000 | 47,057,000 |
Other comprehensive income (loss), after tax, net of reclassification adjustments | 38,272,000 | 53,866,000 | (35,238,000) |
Comprehensive income (loss) | $ (137,455,000) | $ 54,870,000 | $ 11,819,000 |
Earnings (loss) per share | |||
Basic (in dollars per share) | $ (3.26) | $ 0.02 | $ 0.88 |
Diluted (in dollars per share) | $ (3.26) | $ 0.02 | $ 0.88 |
Weighted average number of common shares outstanding: | |||
Basic (in shares) | 53,863 | 53,740 | 53,598 |
Diluted (in shares) | 53,906 | 53,841 | 53,749 |
Cash dividends declared, per common share (in dollars per share) | $ 0.46 | $ 1.24 | $ 1.74 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating Activities | |||
Net income (loss) | $ (175,727,000) | $ 1,004,000 | $ 47,057,000 |
Adjustments to reconcile income (loss) to net cash provided by operating activities: | |||
Goodwill impairment | 161,115,000 | 0 | 0 |
Depreciation and amortization, net of accretion | 21,375,000 | 18,665,000 | 21,255,000 |
(Increase) decrease in cash surrender value of BOLI | (1,735,000) | (2,016,000) | (1,983,000) |
Net realized investment (gains) losses | (15,678,000) | (59,874,000) | 43,488,000 |
Share-based compensation | 3,840,000 | 3,527,000 | 5,321,000 |
Deferred income tax expense (benefit) | (21,148,000) | (28,643,000) | (11,824,000) |
Policy acquisition costs, net of amortization (net deferral) | 8,371,000 | (1,451,000) | (3,855,000) |
Equity in (earnings) loss of unconsolidated subsidiaries | 11,921,000 | 10,061,000 | (8,948,000) |
Distributed earnings from unconsolidated subsidiaries | 36,672,000 | 25,849,000 | 31,219,000 |
Other | 2,409,000 | 2,175,000 | 1,168,000 |
Other changes in assets and liabilities: | |||
Premiums receivable | 42,985,000 | 11,926,000 | (23,381,000) |
Reinsurance related assets and liabilities | (2,047,000) | (52,902,000) | 4,697,000 |
Other assets | (13,721,000) | (13,481,000) | (4,206,000) |
Reserve for losses and loss adjustment expenses | 70,653,000 | 226,679,000 | 71,466,000 |
Unearned premiums | (51,539,000) | (2,125,000) | 16,327,000 |
Other liabilities | 14,597,000 | 8,772,000 | (10,536,000) |
Net cash provided (used) by operating activities | 92,343,000 | 148,166,000 | 177,265,000 |
Purchases of: | |||
Fixed maturities, available-for-sale | (917,037,000) | (695,552,000) | (780,698,000) |
Equity investments | (69,406,000) | (116,092,000) | (203,157,000) |
Other investments | (35,616,000) | (28,851,000) | (32,153,000) |
Funding of qualified affordable housing project tax credit partnerships | (1,583,000) | (357,000) | 0 |
Investment in unconsolidated subsidiaries | (40,093,000) | (69,411,000) | (78,141,000) |
Proceeds from sales or maturities of: | |||
Fixed maturities, available-for-sale | 801,580,000 | 568,572,000 | 914,021,000 |
Equity investments | 196,762,000 | 359,727,000 | 210,481,000 |
Other investments | 35,524,000 | 29,017,000 | 29,815,000 |
Net sales or (purchases) of fixed maturities, trading | (383,000) | (8,254,000) | (38,544,000) |
Return of invested capital from unconsolidated subsidiaries | 40,068,000 | 42,478,000 | 84,534,000 |
Net sales or maturities (purchases) of short-term investments | 2,361,000 | (30,718,000) | 123,886,000 |
Unsettled security transactions, net change | (11,173,000) | (6,455,000) | (4,022,000) |
Purchases of capital assets | (7,478,000) | (9,586,000) | (9,636,000) |
Repayments (advances) under Syndicate Credit Agreement | 0 | 16,009,000 | (184,000) |
Other | (2,010,000) | (5,000) | (1,305,000) |
Net cash provided (used) by investing activities | (8,484,000) | 50,522,000 | 214,897,000 |
Financing Activities | |||
Repayments under Revolving Credit Agreement | 0 | 0 | (123,000,000) |
Repayments of Mortgage Loans | (1,502,000) | (1,447,000) | (1,396,000) |
Dividends to shareholders | (38,664,000) | (93,204,000) | (316,476,000) |
Capital contribution received from (return of capital to) external segregated portfolio cell participants | (2,345,000) | (5,024,000) | (1,005,000) |
Other | (935,000) | (4,115,000) | (4,309,000) |
Net cash provided (used) by financing activities | (43,446,000) | (103,790,000) | (446,186,000) |
Increase (decrease) in cash and cash equivalents | 40,413,000 | 94,898,000 | (54,024,000) |
Cash and cash equivalents at beginning of period | 175,369,000 | 80,471,000 | 134,495,000 |
Cash and cash equivalents at end of period | 215,782,000 | 175,369,000 | 80,471,000 |
Supplemental Disclosure of Cash Flow Information | |||
Cash paid during the year for income taxes, net of refunds | (8,832,000) | 2,748,000 | 5,726,000 |
Cash paid during the year for interest | 14,712,000 | 14,294,000 | 16,165,000 |
Significant Non-Cash Transactions | |||
Operating ROU assets obtained in exchange for operating lease liabilities | 1,351,000 | 5,436,000 | 0 |
Dividends declared and not yet paid | $ 2,694,000 | $ 16,676,000 | $ 43,446,000 |
Accounting Policies
Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Accounting Policies | Accounting Policies Organization and Nature of Business ProAssurance Corporation (ProAssurance, PRA or the Company), a Delaware corporation, is an insurance holding company primarily for wholly owned specialty property and casualty and workers' compensation insurance entities including an entity that provides capital to Syndicate 1729 and Syndicate 6131 at Lloyd's. Risks insured are primarily liability risks located within the U.S. ProAssurance operates in five reportable segments as follows: Specialty P&C, Workers' Compensation Insurance, Segregated Portfolio Cell Reinsurance, Lloyd's Syndicates and Corporate. For more information on the Company's segment reporting, including the nature of products and services provided and financial information by segment, refer to Note 16. Principles of Consolidation The accompanying consolidated financial statements include the accounts of ProAssurance Corporation and its wholly owned subsidiaries. Investments in entities where ProAssurance holds a greater than minor interest but does not hold a controlling interest are accounted for using the equity method. All significant intercompany accounts and transactions are eliminated in consolidation. ProAssurance subsidiaries located in the U.K. are normally reported on a quarter lag due to timing issues regarding the availability of information, except when information is available that is material to the current period. Furthermore, investment results associated with ProAssurance's FAL investments and certain U.S. paid administrative expenses are reported concurrently as that information is available on an earlier time frame. Reclassifications In ProAssurance's December 31, 2019 and 2018 reports on Form 10-K, underwriting, policy acquisition and operating expenses for the years ended December 31, 2019 and 2018 included a provision for U.S. federal income taxes of $1.1 million and $0.4 million, respectively, for SPCs at Inova Re reported in the Company's Segregated Portfolio Cell Reinsurance segment that elected to be taxed as U.S. taxpayers. Beginning in 2020, this tax provision is now presented as a separate line item on the Consolidated Statements of Income and Comprehensive Income as SPC U.S. federal income tax expense. To conform to the current year presentation, ProAssurance has recast underwriting, policy acquisition and operating expenses for the years ended December 31, 2019 and 2018 on the Consolidated Statements of Income and Comprehensive Income as well as in the financial results by segment in Note 16. Certain other insignificant prior year amounts have been reclassified to conform to the current year presentation. Basis of Presentation 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, revenues and expenses, and disclosures related to these amounts at the date of the financial statements. Accounting Policies The significant accounting policies followed by ProAssurance in making estimates that materially affect financial reporting are summarized in these Notes to Consolidated Financial Statements. The Company evaluates these estimates and assumptions on an ongoing basis based on current and historical developments, market conditions, industry trends and other information that the Company believes to be reasonable under the circumstances. The Company can make no assurance that actual results will conform to its estimates and assumptions; reported results of operations may be materially affected by changes in these estimates and assumptions. As a result of the COVID-19 pandemic, the Company is reevaluating certain of these estimates and assumptions which could result in material changes to its results of operations including, but not limited to, higher losses and loss adjustment expenses, lower premium volume, asset impairment charges, declines in investment valuations, reductions in audit premium estimates, deferred tax valuation allowances and increases in the allowance for expected credit losses related to available-for-sale securities, premiums receivable and reinsurance receivables. The extent to which the COVID-19 pandemic impacts the Company's business, results of operations and financial condition will depend on future developments, which are highly uncertain and cannot be predicted. These factors include, but are not limited to, the duration, spread, severity, reemergence or mutation of the COVID-19 pandemic, development and wide-scale distribution of medicines or vaccines that effectively treat the virus, the effects of the COVID-19 pandemic on the Company's insureds, the loss environment, the healthcare industry, the labor market and Lloyd's, the actions and stimulus measures taken by governments and governmental agencies, and to what extent normal economic and operating conditions can resume. Even after the COVID-19 pandemic has subsided, the Company may experience an impact to its business as a result of any economic recession that has occurred or may occur in the future. Recognition of Revenues Insurance premiums are recognized as revenues pro rata over the terms of the policies, which are principally one year in duration. Credit Losses ProAssurance's premiums receivable and reinsurance receivables are exposed to credit losses but to-date have not experienced any significant amount of credit losses. ProAssurance measures expected credit losses on its premiums receivables and reinsurance receivables on a collective (pool) basis when similar risk characteristics exist, and the Company will reassess its pools each reporting period to ensure all receivables within the pool continue to share similar risk characteristics. If the Company determines that a receivable does not share risk characteristics with its other receivables within a pool, it will evaluate that receivable for expected credit losses on an individual basis. ProAssurance measures expected credit losses associated with its premium receivables at the segment level as each segment’s premium receivables share similar risk characteristics including term, type of financial asset and similar historical and expected credit loss patterns. ProAssurance measures expected credit losses associated with its reinsurance receivables (related to both paid and unpaid losses) at the consolidated level as its reinsurance receivables share similar risk characteristics including type of financial asset, type of industry and similar historical and expected credit loss patterns. ProAssurance measures expected credit losses over the contractual term of each pool utilizing a loss rate method. Historical internal credit loss experience for each pool is the basis for the Company’s assessment of expected credit losses; however, the Company may also consider historical credit loss information from external sources. In addition to historical credit loss data, the Company also considers reasonable and supportable forecasts of future economic conditions in its estimate of expected credit losses by utilizing industry and macroeconomic factors that it believes most relevant to the collectability of each pool. ProAssurance's premiums receivable on its Consolidated Balance Sheet as of December 31, 2020 and 2019 is reported net of the related allowance for expected credit losses of $6.1 million and $1.6 million, respectively. The following tables present a roll forward of the allowance for expected credit losses related to the Company's premiums receivable for the year ended December 31, 2020. (In thousands) Premiums Receivable, Net Allowance for Expected Credit Losses Balance, December 31, 2019 $ 249,540 $ 1,590 Cumulative-effect adjustment on January 1, 2020, before tax - ASU 2016-13 adoption 5,160 Provision for expected credit losses 827 Write offs charged against the allowance (2,019) Recoveries of amounts previously written off 573 Balance, December 31, 2020 $ 201,395 $ 6,131 ProAssurance's expected credit losses associated with its reinsurance receivables (related to both paid and unpaid losses) were nominal in amount as of December 31, 2020. ProAssurance has other financial assets and off-balance-sheet commitments that are exposed to credit losses; however, expected credit losses associated with these assets and commitments were nominal in amount as of December 31, 2020. Earned But Unbilled Premiums Workers’ compensation premiums are determined based upon the payroll of the insured, the applicable premium rates and an experience-based modification factor, where applicable. An audit of the policyholders’ records is conducted after policy expiration to make a final determination of applicable premiums. Audit premium due from or due to a policyholder as a result of an audit is reflected in net premiums written and earned when billed. ProAssurance tracks, by policy, the amount of additional premium billed in final audit invoices as a percentage of payroll exposure and uses this information to estimate the probable additional amount of EBUB as of the balance sheet date. Changes to the EBUB estimate are included in net premiums written and earned in the period recognized. As of December 31, 2020 and 2019, ProAssurance carried EBUB of $3.0 million and $4.3 million, respectively, as a part of premiums receivable. As a result of the economic impact of COVID-19, the Company expects future reductions in payroll exposure related to in-force policies that could result in a significant decrease in audit premium and our EBUB estimate. ProAssurance will continue to monitor and adjust the estimate, if necessary, based on changes in insured payrolls and economic conditions, as experience develops or new information becomes known; however, the length and magnitude of such changes depends on future developments, which are highly uncertain and cannot be predicted. Losses and Loss Adjustment Expenses ProAssurance establishes its reserve for losses and LAE ("reserve for losses" or "reserve") based on estimates of the future amounts necessary to pay claims and expenses associated with the investigation and settlement of claims. The reserve for losses is determined on the basis of individual claims and payments thereon as well as actuarially determined estimates of future losses based on past loss experience, available industry data and projections as to future claims frequency, severity, inflationary trends, judicial trends, legislative changes and settlement patterns. Management establishes the reserve for losses after taking into consideration a variety of factors including premium rates, historical paid and incurred loss development trends, and management's evaluation of the current loss environment including frequency, severity, the expected effect of inflation, general economic and social trends, and the legal and political environment. Management also takes into consideration the conclusions reached by internal and consulting actuaries. Management updates and reviews the data underlying the estimation of the reserve for losses each reporting period and makes adjustments to loss estimation assumptions that best reflect emerging data. Both internal and consulting actuaries perform an in-depth review of the reserve for losses on at least a semi-annual basis using the loss and exposure data of ProAssurance's subsidiaries. Consulting actuaries provide reports to management regarding the adequacy of reserves. Estimating casualty insurance reserves, and particularly long-tailed insurance reserves, is a complex process. Long-tailed insurance is characterized by the extended period of time typically required both to assess the viability of a claim and potential damages, if any, and to reach a resolution of the claim. For a high proportion of the risks insured or reinsured by ProAssurance, the period of time required to resolve a claim is often five years or more, and claims may be subject to litigation. Estimating losses for these long-tailed claims requires ProAssurance to make and revise judgments and assessments regarding multiple uncertainties over an extended period of time. As a result, reserve estimates may vary significantly from the eventual outcome. Reserve estimates and the assumptions on which these estimates are predicated are regularly reviewed and updated as new information becomes available. Any adjustments necessary are reflected in current operations. Due to the size of ProAssurance’s reserve for losses, even a small percentage adjustment to these estimates could have a material effect on earnings in the period in which the adjustment is made, as was the case in 2020, 2019 and 2018. The effect of adjustments made to reinsured losses is mitigated by the corresponding adjustment that is made to reinsurance recoveries. Thus, in any given year, ProAssurance may make significant adjustments to gross losses that have little effect on its net losses. Reinsurance Receivables ProAssurance enters into reinsurance agreements whereby other insurance entities agree to assume a portion of the risk associated with certain policies issued by ProAssurance. In return, ProAssurance agrees to pay a premium to the reinsurer. ProAssurance uses reinsurance to provide capacity to write larger limits of liability, to provide reimbursement for losses incurred under the higher limit coverages the Company offers, to provide protection against losses in excess of policy limits, and, in the case of risk sharing arrangements, to align the Company's objectives with those of its strategic business partners and to provide custom insurance solutions for large customer groups. Receivable from reinsurers on paid losses and LAE is the estimated amount of losses already paid that will be recoverable from reinsurers. Receivable from reinsurers on unpaid losses and LAE is the estimated amount of future loss payments that will be recoverable from reinsurers. Reinsurance recoveries are the portion of losses incurred during the period that are estimated to be allocable to reinsurers. Premiums ceded are the estimated premiums that will be due to reinsurers with respect to premiums earned and losses incurred during the period. These estimates are based upon management’s estimates of ultimate losses and the portion of those losses that are allocable to reinsurers under the terms of the related reinsurance agreements. Given the uncertainty of the ultimate amounts of losses, these estimates may vary significantly from the ultimate outcome. Management regularly reviews these estimates and any adjustments necessary are reflected in the period in which the estimate is changed. Due to the size of the receivable from reinsurers, an adjustment to these estimates could have a material effect on ProAssurance's results of operations for the period in which the adjustment is made. Reinsurance contracts do not relieve ProAssurance from its obligations to policyholders. ProAssurance continually monitors its reinsurers to minimize its exposure to significant credit losses from reinsurer insolvencies (see previous discussion under the heading "Credit Losses"). Any amount determined to be uncollectible is written off in the period in which the uncollectible amount is identified. See Note 4 for further information. Retroactive Insurance Contracts In certain instances, ProAssurance’s insurance contracts cover losses both on a prospective basis and retroactive basis, and accordingly, ProAssurance bifurcates the prospective and retroactive provisions of these contracts and accounts for each component separately, where practicable. Under the retroactive provisions of a contract, all premiums received and losses assumed are recognized immediately in earnings at the inception of the contract as all of the underlying loss events occurred in the past. If the estimated losses assumed differ from the premium received related to the retroactive provision of a contract, the resulting difference is deferred and recognized over the estimated claim payment period with the periodic amortization reflected in earnings as a component of net losses and LAE. Deferred gains are included as a component of the reserve for losses and LAE, and deferred losses are included as a component of other assets on the Consolidated Balance Sheet. Subsequent changes to the estimated timing or amount of future loss payments in relation to the losses assumed under retroactive provisions also produce changes in deferred balances. Changes in such estimates are applied retrospectively, and the resulting changes in deferred balances, together with periodic amortization, are included in earnings in the period of change. Lloyd’s Premium Estimates For certain insurance policies and reinsurance contracts written in the Lloyd’s Syndicates segment, premiums are initially recognized based upon estimates of ultimate premium. Estimated ultimate premium consists primarily of premium written under delegated underwriting authority arrangements, which consist primarily of binding authorities, and certain assumed reinsurance agreements. These estimates of ultimate premium are judgmental and are dependent upon certain assumptions, including historical premium trends for similar agreements. As reports are received from programs, ultimate premium estimates are revised, if necessary, with changes reflected in current operations. Deferred Policy Acquisition Costs; Ceding Commission Income Costs that vary with and are directly related to the successful production of new and renewal premiums (primarily premium taxes, commissions and underwriting salaries) are deferred to the extent they are recoverable against unearned premiums and are amortized as related premiums are earned. Unearned ceding commission income is reported as an offset to DPAC, and ceding commission earned is reported as an offset to DPAC amortization. ProAssurance evaluates the recoverability of DPAC typically at the segment level each reporting period, or in a manner that is consistent with the way the Company manages its business. Any amounts estimated to be unrecoverable are charged to expense in the current period. As part of the evaluation of the recoverability of DPAC, ProAssurance also evaluates unearned premium for premium deficiencies. A premium deficiency is recognized if the sum of anticipated losses and loss adjustment expenses, unamortized DPAC and maintenance costs, net of anticipated investment income, exceeds the related unearned premium. If a premium deficiency is identified, the associated DPAC is written off, and a PDR is recorded for the excess deficiency as a component of net losses and loss adjustment expenses in the Consolidated Statement of Income and Comprehensive Income and as a component of the reserve for losses on the Consolidated Balance Sheet. Investments Recurring Fair Value Measurements Fair values of investment securities are primarily provided by independent pricing services. The pricing services provide an exchange-traded price, if available, or provide an estimated price determined using multiple observable inputs, including exchange-traded prices for similar assets. Management reviews valuations of securities obtained from the pricing services for accuracy based upon the specifics of the security, including class, maturity, credit rating, durations, collateral and comparable markets for similar securities. Multiple observable inputs are not available for certain of the Company's investments, including corporate debt not actively traded, certain asset-backed securities and investments in LPs/LLCs. Management values the corporate debt not actively traded and the other asset-backed securities either using dealer quotes for similar securities or discounted cash flow models using yields currently available for similar securities. Management values certain investment funds, primarily LPs/LLCs, based on the NAV of the interest held, as provided by the fund. Nonrecurring Fair Value Measurements Management measures the fair value of certain assets on a nonrecurring basis when events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. These assets include investments carried principally at cost, investments in tax credit partnerships, fixed assets, goodwill and other intangible assets. These assets would also include any equity method investments that do not provide a NAV. Fixed Maturities Fixed maturities are considered as either available-for-sale or trading securities. Available-for-sale securities are carried at fair value, determined as described above and in Note 2. Exclusive of impairment losses, discussed in a separate section that follows, unrealized holding gains and losses on available-for-sale securities are included, net of related tax effects, as a component of OCI in the Consolidated Statement of Income and Comprehensive Income during the period of change and as a component AOCI in shareholders' equity on the Consolidated Balance Sheet. Investment income includes amortization of premium and accretion of discount related to available-for-sale debt securities acquired at other than par value. Debt securities and mandatorily redeemable preferred stock with maturities beyond one year when purchased are classified as fixed maturities. Trading securities are carried at fair value, determined as described above, with the unrealized holding gains and losses included as a component of net realized investment gains (losses) in the Consolidated Statement of Income and Comprehensive Income during the period of change. Equity Investments Equity investments are carried at fair value, as described above, with the holding gains and losses included as a component of net realized investment gains (losses) in the Consolidated Statement of Income and Comprehensive Income during the period of change. Equity investments are primarily comprised of stocks, bond funds and investment funds. Short-term Investments Short-term investments, which have a maturity at purchase of one year or less, are primarily comprised of investments in U.S. Treasury obligations, commercial paper and money market funds. All balances are carried at fair value which approximates the cost of the securities due to their short-term nature. Other Investments Investments in convertible bond securities are carried at fair value as permitted by the accounting guidance for hybrid financial instruments, with changes in fair value recognized in income as a component of net realized investment gains (losses) during the period of change. Interest on convertible bond securities is recorded on an accrual basis based on contractual interest rates and is included in net investment income. Investment in Unconsolidated Subsidiaries Equity investments, primarily investments in LPs/LLCs, where ProAssurance is deemed to have influence because it holds a greater than a minor interest are accounted for using the equity method. Under the equity method, the recorded basis of the investment is adjusted each period for the investor’s pro rata share of the investee’s income or loss. Investments in unconsolidated subsidiaries include tax credit partnerships accounted for using the equity method, whereby ProAssurance’s proportionate share of income or loss is included in equity in earnings (loss) of unconsolidated subsidiaries. Tax credits received from the partnerships are recognized in the period received in the Consolidated Statement of Income and Comprehensive Income as either a reduction to current tax expense or as a component of deferred tax expense if they cannot be utilized in the period received. Business Owned Life Insurance ProAssurance owns life insurance contracts on certain management employees. The life insurance contracts are carried at their current cash surrender value. Changes in the cash surrender value are included in income in the current period as investment income. Death proceeds from the contracts are recorded when the proceeds become payable under the policy terms. Realized Gains and Losses Realized investment gains and losses are recognized on the first-in, first-out basis for GAAP purposes and on the specific identification basis for tax purposes. Impairments ProAssurance evaluates its available-for-sale investment securities, which at December 31, 2020 and 2019 consisted entirely of fixed maturity securities, on at least a quarterly basis for the purpose of determining whether declines in fair value below recorded cost basis represent a credit loss. The Company considers a credit loss to have occurred: • if there is intent to sell the security; • if it is more likely than not that the security will be required to be sold before full recovery of its amortized cost basis; or • if the entire amortized basis of the security is not expected to be recovered. The assessment of whether the amortized cost basis of a security is expected to be recovered requires the Company to make assumptions regarding various matters affecting future cash flows. The choice of assumptions is subjective and requires the use of judgment. Actual credit losses experienced in future periods may differ from the Company’s estimates of those credit losses. Methodologies used to estimate the present value of expected cash flows are: The estimate of expected cash flows is determined by projecting a recovery value and a recovery time frame and assessing whether further principal and interest will be received. ProAssurance considers various factors in projecting recovery values and recovery time frames, including the following: • third-party research and credit rating reports; • the current credit standing of the issuer, including credit rating downgrades, whether before or after the balance sheet date; • the extent to which the decline in fair value is attributable to credit risk specifically associated with the security or its issuer; • internal assessments and the assessments of external portfolio managers regarding specific circumstances surrounding an investment, which indicate the investment is more or less likely to recover its amortized cost than other investments with a similar structure; • for asset-backed securities, the origination date of the underlying loans, the remaining average life, the probability that credit performance of the underlying loans will deteriorate in the future and ProAssurance's assessment of the quality of the collateral underlying the loan; • failure of the issuer of the security to make scheduled interest or principal payments; • any changes to the rating of the security by a rating agency; • recoveries or additional declines in fair value subsequent to the balance sheet date; • adverse legal or regulatory events; • significant deterioration in the market environment that may affect the value of collateral (e.g. decline in real estate prices); • significant deterioration in economic conditions; and • disruption in the business model resulting from changes in technology or new entrants to the industry. If deemed appropriate and necessary, a discounted cash flow analysis is performed to confirm whether a credit loss exists and, if so, the amount of the credit loss. ProAssurance uses the single best estimate approach for available-for-sale debt securities and considers all reasonably available data points, including industry analyses, credit ratings, expected defaults and the remaining payment terms of the debt security. For fixed rate available-for-sale debt securities, cash flows are discounted at the security's effective interest rate implicit in the security at the date of acquisition. If the available-for-sale debt security’s contractual interest rate varies based on subsequent changes in an independent factor, such as an index or rate, for example, the prime rate, the LIBOR, or the U.S. Treasury bill weekly average, that security’s effective interest rate is calculated based on the factor as it changes over the life of the security. If ProAssurance intends to sell a debt security or believes it will more likely than not be required to sell a debt security before the amortized cost basis is recovered, any existing allowance will be written off against the security's amortized cost basis, with any remaining difference between the debt security's amortized cost basis and fair value recognized as an impairment loss in earnings. Exclusive of securities where there is an intent to sell or where it is not more likely than not that the security will be required to be sold before recovery of its amortized cost basis, impairment for debt securities is separated into a credit component and a non-credit component. The credit component of an impairment is the difference between the security’s amortized cost basis and the present value of its expected future cash flows, while the non-credit component is the remaining difference between the security’s fair value and the present value of expected future cash flows. An allowance for expected credit losses will be recorded for the expected credit losses through income and the non-credit component is recognized in OCI. The amount of impairment recognized is limited to the excess of the amortized cost over the fair value of the available-for-sale debt security. Derivatives ProAssurance records derivative instruments at fair value in the Consolidated Balance Sheets. ProAssurance accounts for the changes in fair value of derivatives depending on whether the derivative is designated as a hedging instrument and if so, the type of hedging relationship. For derivative instruments not designated as hedging instruments, ProAssurance recognizes the change in fair value of the derivative in earnings during the period of change. As of December 31, 2020, ProAssurance has not designated any derivative instruments as hedging instruments and does not use derivative instruments for trading purposes. Foreign Currency The functional currency of all ProAssurance foreign subsidiaries is the U.S. dollar. In recording foreign currency transactions, revenue and expense items are converted to U.S. dollars at the exchange rate prevailing at the transaction date. Monetary assets and liabilities originating in currencies other than the U.S. dollar are remeasured to U.S. dollars at the rates of exchange in effect as of the balance sheet date. The resulting foreign currency gains or losses are recognized in the Consolidated Statements of Income and Comprehensive Income as a component of other income. Monetary assets and liabilities include investments, cash and cash equivalents, accrued expenses and other liabilities. In addition, monetary assets and liabilities include certain premiums receivable and reserve for losses and LAE as a result of reinsurance transactions conducted with foreign cedants denominated in their local functional currencies. Cash and Cash Equivalents For purposes of the Consolidated Balance Sheets and Consolidated Statements of Cash Flows, ProAssurance considers all demand deposits and overnight investments to be cash equivalents. Income Taxes/Deferred Taxes ProAssurance files a consolidated federal income tax return. Tax-related interest and penalties are recognized as components of tax expense. ProAssurance evaluates tax positions taken on tax returns and recognizes positions in the financial statements when it is more likely than not that the position will be sustained upon resolution with a taxing authority. If recognized, the benefit is measured as the largest amount of benefit that has a greater than fifty percent probability of being realized. Uncertain tax positions are reviewed each period by considering changes in facts and circumstances, such as changes in tax law, interactions with taxing authorities and developments in case law, and adjustments would be made if considered necessary. Adjustments to unrecognized tax benefits may affect income tax expense, and the settlement of uncertain tax positions may require the use of cash. Other than differences related to timing, no significant adjustments were considered necessary during the years ended December 31, 2020 or 2019. Deferred federal income taxes arise from the recognition of temporary differences between the basis of assets and liabilities determined for financial reporting purposes and the basis determined for income tax purposes. ProAssurance’s temporary differences principally relate to loss reserves, unearned and advanced premiums, DPAC, compensation related items, tax credit carryforwards, unrealized investment gains (losses) and basis differentials in fixed assets, intangible assets and operating leases and investments. Deferred tax assets and liabilities are measured using the enacted tax rates expe |
Fair Value Measurement
Fair Value Measurement | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | Fair Value Measurement Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three level hierarchy has been established for valuing assets and liabilities based on how transparent (observable) the inputs are that are used to determine fair value, with the inputs considered most observable categorized as Level 1 and those that are the least observable categorized as Level 3. Hierarchy levels are defined as follows: Level 1: quoted (unadjusted) market prices in active markets for identical assets and liabilities. For ProAssurance, Level 1 inputs are generally quotes for securities actively traded in exchange or over-the-counter markets. Level 2: market data obtained from sources independent of the reporting entity (observable inputs). For ProAssurance, Level 2 inputs generally include quoted prices in markets that are not active, quoted prices for similar assets or liabilities, and results from pricing models that use observable inputs such as interest rates and yield curves that are generally available at commonly quoted intervals. Level 3: the reporting entity’s own assumptions about market participant assumptions based on the best information available in the circumstances (non-observable inputs). For ProAssurance, Level 3 inputs are used in situations where little or no Level 1 or 2 inputs are available or are inappropriate given the particular circumstances. Level 3 inputs include results from pricing models for which some or all of the inputs are not observable, discounted cash flow methodologies, single non-binding broker quotes and adjustments to externally quoted prices that are based on management judgment or estimation. Fair values of assets measured at fair value on a recurring basis as of December 31, 2020 and December 31, 2019 are shown in the following tables. Where applicable, the tables also indicate the fair value hierarchy of the valuation techniques utilized to determine those fair values. For some assets, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. When this is the case, the asset is categorized based on the level of the most significant input to the fair value measurement. Assessments of the significance of a particular input to the fair value measurement require judgment and consideration of factors specific to the assets being valued. December 31, 2020 Fair Value Measurements Using Total (In thousands) Level 1 Level 2 Level 3 Fair Value Assets: Fixed maturities, available-for-sale U.S. Treasury obligations $ — $ 107,059 $ — $ 107,059 U.S. Government-sponsored enterprise obligations — 12,261 — 12,261 State and municipal bonds — 332,920 — 332,920 Corporate debt, multiple observable inputs — 1,326,077 — 1,326,077 Corporate debt, limited observable inputs — — 3,265 3,265 Residential mortgage-backed securities — 274,509 2,032 276,541 Agency commercial mortgage-backed securities — 13,310 — 13,310 Other commercial mortgage-backed securities — 113,092 — 113,092 Other asset-backed securities — 266,345 6,661 273,006 Fixed maturities, trading — 48,456 — 48,456 Equity investments Financial 13,810 — — 13,810 Utilities/Energy 564 — — 564 Consumer oriented 1,262 — — 1,262 Industrial 2,240 — — 2,240 Bond funds 69,475 — — 69,475 All other 20,202 — — 20,202 Short-term investments 307,695 30,118 — 337,813 Other investments 1,509 42,607 — 44,116 Other assets — 329 — 329 Total assets categorized within the fair value hierarchy $ 416,757 $ 2,567,083 $ 11,958 2,995,798 Assets carried at NAV, which approximates fair value and which are not categorized within the fair value hierarchy, reported as a part of: Equity investments 12,548 Investment in unconsolidated subsidiaries 233,711 Total assets at fair value $ 3,242,057 December 31, 2019 Fair Value Measurements Using Total (In thousands) Level 1 Level 2 Level 3 Fair Value Assets: Fixed maturities, available-for-sale U.S. Treasury obligations $ — $ 110,467 $ — $ 110,467 U.S. Government-sponsored enterprise obligations — 17,340 — 17,340 State and municipal bonds — 296,093 — 296,093 Corporate debt, multiple observable inputs — 1,335,285 — 1,335,285 Corporate debt, limited observable inputs — — 5,079 5,079 Residential mortgage-backed securities — 208,408 — 208,408 Agency commercial mortgage-backed securities — 8,221 — 8,221 Other commercial mortgage-backed securities — 71,868 — 71,868 Other asset-backed securities — 233,032 2,992 236,024 Fixed maturities, trading — 47,284 — 47,284 Equity investments Financial 40,294 — — 40,294 Utilities/Energy 21,195 — — 21,195 Consumer oriented 29,288 — — 29,288 Industrial 26,440 — — 26,440 Bond funds 58,346 — — 58,346 All other 52,512 — — 52,512 Short-term investments 317,313 22,594 — 339,907 Other investments 219 32,713 3,086 36,018 Other assets — 760 — 760 Total assets categorized within the fair value hierarchy $ 545,607 $ 2,384,065 $ 11,157 2,940,829 Assets carried at NAV, which approximates fair value and which are not categorized within the fair value hierarchy, reported as a part of: Equity investments 22,477 Investment in unconsolidated subsidiaries 270,524 Total assets at fair value $ 3,233,830 The fair values for securities included in the Level 2 category, with the few exceptions described below, were developed by one of several third party, nationally recognized pricing services, including services that price only certain types of securities. Each service uses complex methodologies to determine values for securities and subject the values they develop to quality control reviews. Management selected a primary source for each type of security in the portfolio and reviewed the values provided for reasonableness by comparing data to alternate pricing services and to available market and trade data. Values that appeared inconsistent were further reviewed for appropriateness. Any value that did not appear reasonable was discussed with the service that provided the value and adjusted, if necessary. There were no material changes to the values supplied by the pricing services during the years ended December 31, 2020 and 2019. Level 2 Valuations Below is a summary description of the valuation methodologies primarily used by the pricing services for securities in the Level 2 category, by security type: U.S. Treasury obligations were valued based on quoted prices for identical assets, or, in markets that are not active, quotes for similar assets, taking into consideration adjustments for variations in contractual cash flows and yields to maturity. U.S. Government-sponsored enterprise obligations were valued using pricing models that consider current and historical market data, normal trading conventions, credit ratings and the particular structure and characteristics of the security being valued, such as yield to maturity, redemption options, and contractual cash flows. Adjustments to model inputs or model results were included in the valuation process when necessary to reflect recent regulatory, government or corporate actions or significant economic, industry or geographic events affecting the security’s fair value. State and municipal bonds were valued using a series of matrices that considered credit ratings, the structure of the security, the sector in which the security falls, yields and contractual cash flows. Valuations were further adjusted, when necessary, to reflect the expected effect on fair value of recent significant economic or geographic events or ratings changes. Corporate debt, multiple observable inputs consisted primarily of corporate bonds, but also included a small number of bank loans. The methodology used to value Level 2 corporate bonds was the same as the methodology previously described for U.S. Government-sponsored enterprise obligations. Bank loans were valued based on an average of broker quotes for the loans in question, if available. If quotes were not available, the loans were valued based on quoted prices for comparable loans or, if the loan was newly issued, by comparison to similar seasoned issues. Broker quotes were compared to actual trade prices to permit assessment of the reliability of the quotes; unreliable quotes were not considered in quoted averages. Residential and commercial mortgage-backed securities were valued using a pricing matrix which considers the issuer type, coupon rate and longest cash flows outstanding. The matrix used was based on the most recently available market information. Agency and non-agency collateralized mortgage obligations were both valued using models that consider the structure of the security, current and historical information regarding prepayment speeds, ratings and ratings updates, and current and historical interest rate and interest rate spread data. Other asset-backed securities were valued using models that consider the structure of the security, monthly payment information, current and historical information regarding prepayment speeds, ratings and ratings updates, and current and historical interest rate and interest rate spread data. Spreads and prepayment speeds consider collateral type. Fixed maturities, trading , are held by the Lloyd's Syndicates segment and include U.S. Treasury obligations, corporate debt with multiple observable inputs and other asset-backed securities. These securities were valued using the respective valuation methodologies discussed above for each security type. Short-term investments were securities maturing within one year, carried at fair value which approximated the cost of the securities due to their short-term nature. Other investments consisted primarily of convertible bonds valued using a pricing model that incorporated selected dealer quotes as well as current market data regarding equity prices and risk free rates. If dealer quotes were unavailable for the security being valued, quotes for securities with similar terms and credit status were used in the pricing model. Dealer quotes selected for use were those considered most accurate based on parameters such as underwriter status and historical reliability. Other assets consisted of an interest rate cap derivative instrument valued using a model which considers the volatilities from other instruments with similar maturities, strike prices, durations and forward yield curves. Under the terms of the interest rate cap agreement, ProAssurance paid a premium of $2 million for the right to receive cash payments based upon a notional amount of $35 million if and when the three-month LIBOR rises above 2.35%. The Company's variable-rate Mortgage Loans bear an interest rate of three-month LIBOR plus 1.325%. Level 3 Valuations Below is a summary description of the valuation methodologies used as well as quantitative information regarding securities in the Level 3 category, by security type: Level 3 Valuation Methodologies Corporate debt, limited observable inputs consisted of corporate bonds valued using dealer quotes for similar securities or discounted cash flow models using yields currently available for similar securities. Similar securities are defined as securities of comparable credit quality that have like terms and payment features. Assessments of credit quality were based on NRSRO ratings, if available, or were determined by management if not available. At December 31, 2020, 100% of the securities were rated and the average rating was BB+. At December 31, 2019, 66% of the securities were rated and the average rating was BBB-. Residential mortgage-backed and other asset-backed securities consisted of securitizations of receivables valued using dealer quotes for similar securities or discounted cash flow models using yields currently available for similar securities. Similar securities are defined as securities of comparable credit quality that have like terms and payment features. Assessments of credit quality were based on NRSRO ratings, if available, or were subjectively determined by management if not available. At December 31, 2020, 51% of the securities were rated and the average rating was AA-. At December 31, 2019, 100% of the securities were rated and the average rating was AA. Other investments consisted of convertible securities for which limited observable inputs were available at December 31, 2019. The securities were valued internally based on expected cash flows, including the expected final recovery, discounted at a yield that considered the lack of liquidity and the financial status of the issuer. Quantitative Information Regarding Level 3 Valuations Fair Value at ($ in thousands) December 31, 2020 December 31, 2019 Valuation Technique Unobservable Input Range Assets: Corporate debt, limited observable inputs $3,265 $5,079 Market Comparable Comparability Adjustment 0% - 5% (2.5%) Discounted Cash Flows Comparability Adjustment 0% - 5% (2.5%) Residential mortgage-backed securities $2,032 $— Market Comparable Comparability Adjustment 0% - 5% (2.5%) Discounted Cash Flows Comparability Adjustment 0% - 5% (2.5%) Other asset-backed securities $6,661 $2,992 Market Comparable Comparability Adjustment 0% - 5% (2.5%) Discounted Cash Flows Comparability Adjustment 0% - 5% (2.5%) Other investments $— $3,086 Discounted Cash Flows Comparability Adjustment 0% - 10% (5%) The significant unobservable inputs used in the fair value measurement of the above listed securities were the valuations of comparable securities with similar issuers, credit quality and maturity. Changes in the availability of comparable securities could result in changes in the fair value measurements. Fair Value Measurements - Level 3 Assets The following tables (the Level 3 Tables) present summary information regarding changes in the fair value of assets measured at fair value using Level 3 inputs. December 31, 2020 Level 3 Fair Value Measurements – Assets (In thousands) Corporate Debt Asset-backed Securities Other Investments Total Balance December 31, 2019 $ 5,079 $ 2,992 $ 3,086 $ 11,157 Total gains (losses) realized and unrealized: Included in earnings, as a part of: Net investment income (2) (18) — (20) Net realized investment gains (losses) — (8) 151 143 Included in other comprehensive income 216 109 — 325 Purchases 2,869 20,490 — 23,359 Sales (2,178) (4,346) — (6,524) Transfers in 945 605 — 1,550 Transfers out (3,664) (11,131) (3,237) (18,032) Balance December 31, 2020 $ 3,265 $ 8,693 $ — $ 11,958 Change in unrealized gains (losses) included in earnings for the above period for Level 3 assets held at period-end $ — $ — $ 151 $ 151 December 31, 2019 Level 3 Fair Value Measurements – Assets (In thousands) Corporate Debt Asset-backed Securities Other Investments Total Balance December 31, 2018 $ 4,322 $ 3,850 $ 3 $ 8,175 Total gains (losses) realized and unrealized: Included in earnings, as a part of: Net investment income 2 (204) — (202) Net realized investment gains (losses) — — 151 151 Included in other comprehensive income 37 202 — 239 Purchases 3,575 — 3,091 6,666 Sales (3,702) (494) (172) (4,368) Transfers in 3,095 2,216 418 5,729 Transfers out (2,250) (2,578) (405) (5,233) Balance December 31, 2019 $ 5,079 $ 2,992 $ 3,086 $ 11,157 Change in unrealized gains (losses) included in earnings for the above period for Level 3 assets held at period-end $ — $ — $ 164 $ 164 Transfers Transfers shown in the preceding Level 3 tables were as of the end of the period in which the transfer occurred. All transfers were to or from Level 2. All transfers in and out of Level 3 during 2020 and 2019 related to securities held for which the level of market activity for identical or nearly identical securities varies from period to period. The securities were valued using multiple observable inputs when those inputs were available; otherwise the securities were valued using limited observable inputs. Fair Values Not Categorized At December 31, 2020 and 2019, certain LPs/LLCs and investment funds measure fund assets at fair value on a recurring basis and provide a NAV for ProAssurance's interest. The carrying value of these interests is based on the NAV provided and was considered to approximate the fair value of the interests. For investment in unconsolidated subsidiaries, ProAssurance recognizes any changes in the NAV of its interests in equity in earnings (loss) of unconsolidated subsidiaries during the period of change. In accordance with GAAP, the fair value of these investments was not classified within the fair value hierarchy. The amount of ProAssurance's unfunded commitments related to these investments as of December 31, 2020 and fair values of these investments as of December 31, 2020 and 2019 were as follows: Unfunded Fair Value (In thousands) December 31, 2020 December 31, 2020 December 31, 2019 Equity investments: Mortgage fund (1) None $ 12,548 $ 22,477 Investment in unconsolidated subsidiaries: Private debt funds (2) $12,395 16,387 19,011 Long equity fund (3) None — 5,293 Long/short equity funds (4) None 596 30,542 Non-public equity funds (5) $44,252 138,357 120,343 Multi-strategy fund of funds (6) None — 1,951 Credit funds (7) $1,937 34,848 42,415 Long/short commodities fund (8) None — 14,519 Strategy focused funds (9) $38,103 43,523 36,450 233,711 270,524 Total investments carried at NAV $ 246,259 $ 293,001 Below is additional information regarding each of the investments listed in the table above as of December 31, 2020. (1) This investment fund is focused on the structured mortgage market. The fund primarily invests in U.S. Agency mortgage-backed securities. Redemptions are allowed at the end of any calendar quarter with a prior notice requirement of 65 days and are paid within 45 days at the end of the redemption dealing day. (2) This investment is comprised of interests in two unrelated LP funds that are structured to provide interest distributions primarily through diversified portfolios of private debt instruments. One LP allows redemption by special consent, while the other does not permit redemption. Income and capital are to be periodically distributed at the discretion of the LPs over an anticipated time frame that spans from three (3) This fund is a LP that holds long equities of public international companies and was fully redeemed during the second quarter of 2020. (4) This investment holds primarily long and short North American equities and targets absolute returns using strategies designed to take advantage of market opportunities. Redemptions are permitted; however, redemptions above specified thresholds (lowest threshold is 90%) may be only partially payable until after a fund audit is completed and are then payable within 30 days. (5) This investment is comprised of interests in multiple unrelated LP funds, each structured to provide capital appreciation through diversified investments in private equity, which can include investments in buyout, venture capital, debt including senior, second lien and mezzanine, distressed debt, collateralized loan obligations and other private equity-oriented LPs. Two of the LPs allow redemption by terms set forth in the LP agreements; the others do not permit redemption. Income and capital are to be periodically distributed at the discretion of the LP over time frames that are anticipated to span up to ten years. (6) This fund is a LLC structured to build and manage low volatility, multi-manager portfolios that have little or no correlation to the broader fixed income and equity security markets. Redemptions are not permitted but offers to repurchase units of the LLC may be extended periodically. This fund was fully redeemed during the fourth quarter of 2020. (7) This investment is comprised of four unrelated LP funds. Two funds seek to obtain superior risk-adjusted absolute returns through a diversified portfolio of debt securities, including bonds, loans and other asset-backed instruments. A third fund focuses on private middle market company mezzanine loans, while the remaining fund seeks event driven opportunities across the corporate credit spectrum. Two funds are allowed redemptions at any quarter-end with a prior notice requirement of 90 days; one fund permits redemption at any quarter-end with a prior notice requirement of 180 days and one fund does not allow redemptions. For the fund that does not allow redemptions, income and capital are to be periodically distributed at the discretion of the LP over time frames that are anticipated to span up to twelve years. (8) This fund is a LLC invested across a broad range of commodities and focuses primarily on market neutral, relative value strategies, seeking to generate absolute returns with low correlation to broad commodity, equity and fixed income markets. This fund was fully redeemed during the second quarter of 2020. (9) This investment is comprised of multiple unrelated LPs/LLCs funds. One fund is a LLC focused on investing in North American consumer products companies, comprised of equity and equity-related securities, as well as debt instruments. A second fund is focused on aircraft investments, along with components and assets related to aircrafts. For both funds, redemptions are not permitted. Another fund is a LP focused on North American energy infrastructure assets that allows redemption with consent of the General Partner. The remaining funds are real estate focused LPs, one of which allows for redemption with prior notice. ProAssurance may not sell, transfer or assign its interest in any of the above LPs/LLCs without special consent from the LPs/LLCs. Nonrecurring Fair Value Measurement During the third quarter of 2020, ProAssurance recognized a nonrecurring fair value measurement related to the goodwill in its Specialty P&C reporting unit with a carrying value of $161.1 million prior to the fair value measurement. This nonrecurring fair value measurement resulted in the goodwill being written down to its implied fair value of zero resulting in an impairment of the goodwill of $161.1 million. The inputs used in the fair value measurement were non-observable and, as such, were categorized as a Level 3 valuation. ProAssurance did not have any other assets or liabilities that were measured at fair value on a nonrecurring basis at December 31, 2020 or 2019. Financial Instruments - Methodologies Other Than Fair Value The following table provides the estimated fair value of the Company's financial instruments that, in accordance with GAAP for the type of investment, are measured using a methodology other than fair value. Fair values provided primarily fall within the Level 3 fair value category. December 31, 2020 December 31, 2019 (In thousands) Carrying Fair Carrying Fair Financial assets: BOLI $ 67,847 $ 67,847 $ 66,112 $ 66,112 Other investments $ 2,952 $ 2,952 $ 2,931 $ 2,931 Other assets $ 31,128 $ 31,141 $ 28,645 $ 28,650 Financial liabilities: Senior notes due 2023* $ 250,000 $ 269,160 $ 250,000 $ 273,865 Mortgage Loans* $ 36,113 $ 36,113 $ 37,617 $ 37,617 Other liabilities $ 30,334 $ 30,334 $ 27,953 $ 27,953 * Carrying value excludes unamortized debt issuance costs. The fair value of the BOLI was equal to the cash surrender value associated with the policies on the valuation date. Other investments listed in the table above include FHLB common stock carried at cost and an annuity investment carried at amortized cost. Two of ProAssurance's insurance subsidiaries are members of an FHLB. The estimated fair value of the FHLB common stock was based on the amount the subsidiaries would receive if their memberships were canceled, as the memberships cannot be sold. The fair value of the annuity represents the present value of the expected future cash flows discounted using a rate available in active markets for similarly structured instruments. Other assets and other liabilities primarily consisted of related investment assets and liabilities associated with funded deferred compensation agreements. The fair value of the funded deferred compensation assets was based upon quoted market prices, which is categorized as a Level 1 valuation, and had a fair value of $30.6 million and $26.9 million at December 31, 2020 and 2019, respectively. The deferred compensation liabilities are adjusted to match the fair value of the deferred compensation assets. Other assets also included an unsecured note receivable under a separate line of credit agreement. The fair value of the note receivable was based on the present value of expected cash flows from the note receivable, discounted at market rates on the valuation date for receivables with similar credit standings and similar payment structures. The fair value of the debt was estimated based on the present value of expected future cash outflows, discounted at rates available on the valuation date for similar debt issued by entities with a similar credit standing to ProAssurance. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments Available-for-sale fixed maturities at December 31, 2020 and December 31, 2019 included the following: December 31, 2020 (In thousands) Amortized Allowance for Expected Credit Losses Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Fixed maturities, available-for-sale U.S. Treasury obligations $ 104,097 $ — $ 2,985 $ 23 $ 107,059 U.S. Government-sponsored enterprise obligations 12,103 — 158 — 12,261 State and municipal bonds 316,022 — 16,937 39 332,920 Corporate debt 1,267,992 552 63,204 1,302 1,329,342 Residential mortgage-backed securities 269,752 — 7,171 382 276,541 Agency commercial mortgage-backed securities 12,623 — 687 — 13,310 Other commercial mortgage-backed securities 109,244 — 4,788 940 113,092 Other asset-backed securities 269,742 — 4,006 742 273,006 $ 2,361,575 $ 552 $ 99,936 $ 3,428 $ 2,457,531 December 31, 2019 (In thousands) Amortized Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Fixed maturities, available-for-sale U.S. Treasury obligations $ 109,060 $ 1,533 $ 126 $ 110,467 U.S. Government-sponsored enterprise obligations 17,215 125 — 17,340 State and municipal bonds 287,658 9,110 675 296,093 Corporate debt 1,308,889 33,050 1,575 1,340,364 Residential mortgage-backed securities 205,588 3,139 319 208,408 Agency commercial mortgage-backed securities 8,054 182 15 8,221 Other commercial mortgage-backed securities 70,621 1,468 221 71,868 Other asset-backed securities 234,219 1,958 153 236,024 $ 2,241,304 $ 50,565 $ 3,084 $ 2,288,785 The recorded cost basis and estimated fair value of available-for-sale fixed maturities at December 31, 2020, by contractual maturity, are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. (In thousands) Amortized Due in one Due after Due after Due after Total Fair Fixed maturities, available-for-sale U.S. Treasury obligations $ 104,097 $ 23,049 $ 73,580 $ 10,430 $ — $ 107,059 U.S. Government-sponsored enterprise obligations 12,103 — 9,093 3,014 154 12,261 State and municipal bonds 316,022 14,466 141,826 158,927 17,701 332,920 Corporate debt 1,267,992 143,719 700,708 425,711 59,204 1,329,342 Residential mortgage-backed securities 269,752 276,541 Agency commercial mortgage-backed securities 12,623 13,310 Other commercial mortgage-backed securities 109,244 113,092 Other asset-backed securities 269,742 273,006 $ 2,361,575 $ 2,457,531 Excluding obligations of the U.S. Government, U.S. Government-sponsored enterprises and a U.S. Government obligations money market fund, no investment in any entity or its affiliates exceeded 10% of shareholders’ equity at December 31, 2020. Cash and securities with a carrying value of $42.3 million at December 31, 2020 were on deposit with various state insurance departments to meet regulatory requirements. As a member of Lloyd's, ProAssurance is required to maintain capital at Lloyd's, referred to as FAL, to support underwriting by Syndicate 1729 and Syndicate 6131. At December 31, 2020, ProAssurance's FAL investments were comprised of available-for-sale fixed maturities with a fair value of $95.0 million and cash and cash equivalents of $11.2 million on deposit with Lloyd's in order to satisfy these FAL requirements. During the third quarter of 2020, ProAssurance received a return of approximately $32.3 million of cash and cash equivalents from its FAL balances given the Company's reduced participation in the results of Syndicate 1729 for the 2020 underwriting year to 29% from 61%. Investments Held in a Loss Position The following tables provide summarized information with respect to investments held in an unrealized loss position at December 31, 2020 and December 31, 2019, including the length of time the investment had been held in a continuous unrealized loss position. December 31, 2020 Total Less than 12 months 12 months or longer Fair Unrealized Fair Unrealized Fair Unrealized (In thousands) Value Loss Value Loss Value Loss Fixed maturities, available-for-sale U.S. Treasury obligations $ 14,390 $ 23 $ 14,390 $ 23 $ — $ — State and municipal bonds 6,416 39 6,416 39 — — Corporate debt 94,695 1,302 79,436 1,020 15,259 282 Residential mortgage-backed securities 34,928 382 34,509 381 419 1 Other commercial mortgage-backed securities 18,766 940 18,480 935 286 5 Other asset-backed securities 43,739 742 37,850 701 5,889 41 $ 212,934 $ 3,428 $ 191,081 $ 3,099 $ 21,853 $ 329 December 31, 2019 Total Less than 12 months 12 months or longer Fair Unrealized Fair Unrealized Fair Unrealized (In thousands) Value Loss Value Loss Value Loss Fixed maturities, available-for-sale U.S. Treasury obligations $ 25,959 $ 126 $ 15,305 $ 103 $ 10,654 $ 23 State and municipal bonds 36,565 675 35,621 674 944 1 Corporate debt 128,254 1,575 88,582 932 39,672 643 Residential mortgage-backed securities 59,291 319 28,048 63 31,243 256 Agency commercial mortgage-backed securities 459 15 158 — 301 15 Other commercial mortgage-backed securities 18,339 221 16,924 206 1,415 15 Other asset-backed securities 48,912 153 37,322 145 11,590 8 $ 317,779 $ 3,084 $ 221,960 $ 2,123 $ 95,819 $ 961 As of December 31, 2020, excluding U.S. Government or U.S. Government-sponsored enterprise obligations, there were 292 debt securities (11.1% of all available-for-sale fixed maturity securities held) in an unrealized loss position representing 229 issuers. The greatest and second greatest unrealized loss positions among those securities were approximately $0.4 million and $0.2 million, respectively. The securities were evaluated for impairment as of December 31, 2020. As of December 31, 2019, excluding U.S. Government or U.S. Government-sponsored enterprise obligations, there were 263 debt securities (12.1% of all available-for-sale fixed maturity securities held) in an unrealized loss position representing 204 issuers. The greatest and second greatest unrealized loss positions among those securities were approximately $0.2 million and $0.1 million, respectively. The securities were evaluated for impairment as of December 31, 2019. Each quarter, ProAssurance performs a detailed analysis for the purpose of assessing whether any of the securities it holds in an unrealized loss position has suffered an impairment due to credit or non-credit factors. A detailed discussion of the factors considered in the assessment is included in Note 1. Fixed maturity securities held in an unrealized loss position at December 31, 2020, excluding asset-backed securities, have paid all scheduled contractual payments and are expected to continue doing so. Expected future cash flows of asset-backed securities, excluding those issued by GNMA, FNMA and FHLMC, held in an unrealized loss position were estimated as part of the December 31, 2020 impairment evaluation using the most recently available six-month historical performance data for the collateral (loans) underlying the security or, if historical data was not available, sector based assumptions, and equaled or exceeded the current amortized cost basis of the security. The following tables present a roll forward of the allowance for expected credit losses on available-for-sale fixed maturities for the year ended December 31, 2020. Year Ended December 31, 2020 (In thousands) Corporate Debt Total Balance December 31, 2019 $ — $ — Additional credit losses related to securities for which: No allowance for credit losses has been previously recognized 1,508 1,508 Reductions related to: Securities sold during the period (956) (956) Balance December 31, 2020 $ 552 $ 552 Other information regarding sales and purchases of fixed maturity available-for-sale securities is as follows: Year Ended December 31 (In millions) 2020 2019 2018 Proceeds from sales (exclusive of maturities and paydowns) $ 354.4 $ 177.1 $ 599.6 Purchases $ 917.0 $ 695.6 $ 780.7 Equity Investments ProAssurance's equity investments are carried at fair value with changes in fair value recognized in income as a component of net realized investment gains (losses) during the period of change. Equity investments on the Consolidated Balance Sheets as of December 31, 2020 and 2019 primarily included stocks, bond funds and investment funds. Short-term Investments ProAssurance's short-term investments, which have a maturity at purchase of one year or less, are primarily comprised of investments in U.S. treasury obligations, commercial paper and money market funds. Short-term investments are carried at fair value which approximates the cost of the securities due to their short-term nature. BOLI ProAssurance holds BOLI policies that are carried at the current cash surrender value of the policies (original cost $33 million). All insured individuals were members of ProAssurance management at the time the policies were acquired. The primary purpose of the program is to offset future employee benefit expenses through earnings on the cash value of the policies. ProAssurance is the owner and beneficiary of these policies. Net Investment Income Net investment income by investment category was as follows: Year Ended December 31 (In thousands) 2020 2019 2018 Fixed maturities $ 69,308 $ 72,593 $ 69,515 Equities 4,369 17,650 21,418 Short-term investments, including Other 2,683 7,493 5,649 BOLI 2,023 2,017 1,983 Investment fees and expenses (6,385) (6,484) (6,681) Net investment income $ 71,998 $ 93,269 $ 91,884 Investment in Unconsolidated Subsidiaries ProAssurance's investment in unconsolidated subsidiaries were as follows: December 31, 2020 Carrying Value (In thousands) Percentage December 31, December 31, Qualified affordable housing project tax credit partnerships See below $ 27,719 $ 46,421 Other tax credit partnerships See below — 2,085 All other investments, primarily investment fund LPs/LLCs See below 282,810 310,314 $ 310,529 $ 358,820 Qualified affordable housing project tax credit partnership interests held by ProAssurance generate investment returns by providing tax benefits to fund investors in the form of tax credits and project operating losses. The carrying value of these investments reflects ProAssurance's total commitments (both funded and unfunded) to the partnerships, less any amortization. ProAssurance's ownership percentage relative to two of the tax credit partnership interests is almost 100%; these interests had a carrying value of $9.4 million and $17.2 million at December 31, 2020 and 2019, respectively. ProAssurance's ownership percentage relative to the remaining tax credit partnership interests is less than 20%; these interests had a carrying value of $18.3 million and $29.2 million at December 31, 2020 and 2019, respectively. Since ProAssurance has the ability to exert influence over the partnerships but does not control them, all are accounted for using the equity method. See further discussion of the entities in which ProAssurance holds passive interests in Note 14. ProAssurance's other tax credit partnership is an investment in a historic tax credit partnership that generates investment returns by providing benefits to fund investors in the form of tax credits, tax deductible project operating losses and positive cash flows. The carrying value of this investment reflects ProAssurance's total funded commitment less any amortization. During the second quarter of 2020, this investment was fully amortized up to the total current funded commitment. ProAssurance's ownership percentage relative to the historic tax credit partnership is almost 100%. Since ProAssurance has the ability to exert influence over the partnership but does not control it, it is accounted for using the equity method. See further discussion of the entities in which ProAssurance holds passive interests in Note 14. ProAssurance holds interests in investment fund LPs/LLCs and other equity method investments and LPs/LLCs which are not considered to be investment funds. ProAssurance's ownership percentage relative to four of the LPs/LLCs is greater than 25%, which is expected to be reduced as the funds mature and other investors participate in the funds; these investments had a carrying value of $46.2 million at December 31, 2020 and $41.0 million at December 31, 2019. ProAssurance's ownership percentage relative to the remaining investments and LPs/LLCs is less than 25%; these interests had a carrying value of $236.6 million at December 31, 2020 and $269.3 million at December 31, 2019. ProAssurance does not have the ability to exert control over any of these funds. Equity in Earnings (Loss) of Unconsolidated Subsidiaries Equity in earnings (loss) of unconsolidated subsidiaries included losses from qualified affordable housing project tax credit partnerships and a historic tax credit partnership. Investment results recorded reflect ProAssurance's allocable portion of partnership operating results. Tax credits reduce income tax expense in the period they are recognized. The results recorded and tax credits recognized related to ProAssurance's tax credit partnership investments were as follows: Year Ended December 31 (In thousands) 2020 2019 2018 Qualified affordable housing project tax credit partnerships Losses recorded $ 18,684 $ 19,231 $ 18,889 Tax credits recognized $ 17,465 $ 21,933 $ 18,474 Historic tax credit partnership Losses recorded $ 1,092 $ 1,672 $ 5,434 Tax credits recognized $ 412 $ — $ 2,567 Due to the expected NOL for the year ended December 31, 2020 and realized NOL for the year ended December 31, 2019, the tax credits generated from tax credit partnership investments of $17.9 million and $18.2 million, respectively, were deferred and are expected to be utilized in future periods (see further discussion in Note 5). Net Realized Investment Gains (Losses) Realized investment gains and losses are recognized on the first-in, first-out basis. The following table provides detailed information regarding net realized investment gains (losses): Year Ended December 31 (In thousands) 2020 2019 2018 Total impairment losses: Corporate debt $ (1,745) $ (978) $ (490) Portion of impairment losses recognized in other comprehensive income before taxes: Corporate debt 237 227 — Net impairment losses recognized in earnings (1,508) (751) (490) Gross realized gains, available-for-sale fixed maturities 13,855 3,786 5,942 Gross realized (losses), available-for-sale fixed maturities (2,501) (538) (5,799) Net realized gains (losses), trading fixed maturities 288 74 (100) Net realized gains (losses), equity investments 13,192 20,577 12,230 Net realized gains (losses), other investments 3,883 1,626 1,340 Change in unrealized holding gains (losses), trading fixed maturities 501 705 (317) Change in unrealized holding gains (losses), equity investments (16,287) 30,674 (52,707) Change in unrealized holding gains (losses), convertible securities, carried at fair value 3,850 3,653 (3,849) Other 405 68 262 Net realized investment gains (losses) $ 15,678 $ 59,874 $ (43,488) For the year ended December 31, 2020, ProAssurance recognized $1.5 million of credit-related impairment losses in earnings and a nominal amount of non-credit impairment losses in OCI. The credit-related impairment losses recognized in 2020 primarily related to corporate bonds in the energy and consumer sectors. Additionally, 2020 included credit-related impairment losses related to four corporate bonds in various sectors, which were sold during 2020. The non-credit impairment losses recognized during 2020 related to three corporate bonds in the energy and consumer sectors. For the year ended December 31, 2019, ProAssurance recognized credit-related impairment losses in earnings of $0.8 million and nominal amount of non-credit impairment losses in OCI, both of which related to three corporate bonds in the energy and consumer sectors. For the year ended December 31, 2018, ProAssurance recognized credit-related impairment losses in earnings of $0.5 million related to debt instruments from two issuers in the energy sector. ProAssurance recognized $15.7 million of net realized investment gains during 2020, driven primarily by realized gains on the sale of available-for-sale fixed maturities and equity investments, partially offset by unrealized holding losses resulting from decreases in the fair value on the Company's equity portfolio due to the volatility in the global financial markets related to COVID-19. ProAssurance recognized $59.9 million of net realized investment gains during 2019 driven by both realized gains from the sale of equity investments and unrealized holding gains on the Company's equity portfolio due to the improvement in the market since December 31, 2018, which caused the Company's equity securities to increase in value. The most significant sectors that benefited from the improvement in the market were the financial and energy sectors. ProAssurance recognized $43.5 million of net realized investment losses during 2018 driven by unrealized holding losses on the Company's equity portfolio due to market volatility throughout 2018, which caused the securities to decline in value; the most significant sectors impacted were the financial and energy sectors, although all sectors were impacted. The following table presents a roll forward of cumulative credit losses recorded in earnings related to impaired debt securities for which a portion of the impairment was recorded in OCI. Year Ended December 31 (In thousands) 2020 2019 2018 Balance beginning of period $ 470 $ 93 $ 1,313 Additional credit losses recognized during the period, related to securities for which: No impairment has been previously recognized 1,064 377 — Impairment has been previously recognized 258 — — Reductions due to: Securities sold during the period (realized) (1,240) — (1,220) Balance December 31 $ 552 $ 470 $ 93 |
Reinsurance
Reinsurance | 12 Months Ended |
Dec. 31, 2020 | |
Insurance [Abstract] | |
Reinsurance | Reinsurance ProAssurance purchases reinsurance from third-party reinsurers and insurance enterprises in order to reduce its net exposure to losses, to provide capacity to write larger limits of liability, to provide reimbursement for losses incurred under the higher limit coverages the Company offers and as a mechanism for providing custom insurance solutions. ProAssurance also uses reinsurance arrangements as a mechanism for sharing risk with insureds or their affiliates. The effects of reinsurance for the years ended December 31, 2020, 2019 and 2018 were as follows: Year Ended December 31 (In thousands) 2020 2019 2018 Direct $ 814,298 $ 919,799 $ 910,198 Assumed 40,124 47,691 47,113 Ceded (106,721) (124,765) (122,397) Net premiums written $ 747,701 $ 842,725 $ 834,914 Direct $ 862,742 $ 926,035 $ 903,354 Assumed 43,555 45,668 41,535 Ceded (113,582) (124,171) (126,036) Net premiums earned $ 792,715 $ 847,532 $ 818,853 Losses and loss adjustment expenses $ 741,719 $ 871,780 $ 675,784 Reinsurance recoveries (80,272) (117,865) (82,574) Net losses and loss adjustment expenses $ 661,447 $ 753,915 $ 593,210 The receivable from reinsurers on unpaid losses and LAE represents management’s estimated amount of future loss payments that will be recoverable under ProAssurance reinsurance agreements. Certain of the Company's reinsurance agreements base the amount of premium that is due to the reinsurer in part on losses reimbursed or to be reimbursed under the agreement, and terms may also include minimum and maximum amounts of ceded premium. Ceded premium amounts are estimated based on management’s expectation of ultimate losses and the portion of those losses that are allocable to reinsurers according to the terms of the agreements, including any minimums or maximums. Given the uncertainty of the ultimate amounts of losses, management’s estimates of losses and related amounts recoverable may vary significantly from the eventual outcome. Due to changes in management’s estimates of amounts due to reinsurers related to prior accident year loss recoveries, ProAssurance increased premiums ceded in its Specialty P&C segment by $0.7 million, $2.8 million and $5.5 million during the years ended December 31, 2020, 2019 and 2018, respectively. Reinsurance contracts do not relieve ProAssurance from its obligations to policyholders, and ProAssurance remains liable to its policyholders whether or not reinsurers honor their contractual obligations. ProAssurance continually monitors its reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. At December 31, 2020, the net total amounts due from reinsurers was $395.3 million (receivables related to paid and unpaid losses and LAE and prepaid reinsurance premiums, less reinsurance premiums payable). No single reinsurer had an individual balance which exceeded $51.0 million. At December 31, 2020 reinsurance recoverables totaling approximately $96.1 million were collateralized by letters of credit or funds withheld. Expected credit losses associated with the Company's reinsurance receivables (related to both paid and unpaid losses) were nominal in amount as of December 31, 2020. ProAssurance had no allowance for expected credit losses related to our reinsurance receivables at December 31, 2019 or 2018. During the years ended December 31, 2020, 2019 or 2018, no reinsurance balances were written off for credit reasons. For further information on our allowance for expected credit losses related to our receivables from reinsurers see Note 1. During the fourth quarter of 2020, ProAssurance commuted a quota share reinsurance agreement with one of its reinsurers which resulted in a net cash receipt of approximately $6.8 million and reduced its receivable from reinsurers on unpaid losses and LAE by approximately $7.0 million. During the fourth quarter of 2018 and 2017, ProAssurance commuted the 2017 and 2016 calendar year quota share reinsurance arrangements, respectively, between the Specialty P&C segment and Syndicate 1729. Due to the quarter lag, the effects of the 2017 and 2016 commutations were reported in both the Specialty P&C and Lloyd's Syndicates segments results during the first quarter of 2019 and 2018, respectively, which resulted in a net cash receipt of approximately $3.1 million and $6.1 million, respectively. The commutations reduced the receivable from reinsurers on unpaid losses and LAE, combined, by approximately $3.8 million and $6.7 million during the years ended December 31, 2019 and 2018, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Deferred income taxes reflect the net tax effects of temporary differences between the amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of ProAssurance’s deferred tax assets and liabilities were as follows: December 31 (In thousands) 2020 2019 Deferred tax assets Unpaid loss discount $ 36,452 $ 34,455 Unearned premium adjustment 14,835 16,346 Compensation related 10,935 10,041 Basis differentials–investments 2,595 — Intangibles 522 591 Operating lease liabilities 4,224 4,631 Basis differentials-foreign operations — 126 Tax credit carryforward 36,155 21,778 Net operating loss carryforward 9,244 7,682 Other 1,700 — Total gross deferred tax assets 116,662 95,650 Valuation allowance (8,581) (5,479) Total deferred tax assets, net of valuation allowance 108,081 90,171 Deferred tax liabilities Deferred policy acquisition costs (8,929) (9,889) Unpaid loss discount–transition (6,297) (7,557) Unrealized gains on investments, net (19,351) (9,753) Fixed assets (4,441) (1,263) Operating lease ROU assets (4,015) (4,439) Basis differentials–investments — (2,377) Basis differentials-foreign operations (790) — Intangibles (7,153) (10,382) Other — (124) Total deferred tax liabilities (50,976) (45,784) Net deferred tax assets (liabilities) $ 57,105 $ 44,387 As of December 31, 2020, ProAssurance had U.S. state and U.K. income tax NOL carryforwards of approximately $52.7 million and $32.9 million, respectively. The U.K. NOL carryforwards do not expire while the state NOL carryforwards will begin to expire in 2031. ProAssurance had $36.1 million of available tax credit carryforwards generated from the Company's investments in tax credit partnerships, of which $18.2 million and $17.9 million may be carried forward until December 31, 2039 and 2040, respectively. These tax credits have been deferred and carried forward due to the Company's realized NOL in 2019 and expected NOL in 2020. In 2020 and 2019, management evaluated the realizability of the deferred tax asset related to the U.K. NOL carryforwards and concluded that it was more likely than not that the deferred tax asset will not be realized; therefore, a valuation allowance was recorded against the full value of the deferred tax asset related to the U.K. NOL carryforwards in both 2020 and 2019 of $6.2 million and $4.9 million, respectively. The increase in the valuation allowance related to the U.K. NOL carryforward in 2020 as compared to 2019 was primarily due to an increase in the U.K. tax rate from 17% to the current tax rate of 19% as well as current year activity. In 2020, management evaluated the realizability of the deferred tax asset related to the U.S. state NOL carryforwards and concluded that it was more likely than not that a portion of the deferred tax asset will not be realized; therefore, a valuation allowance was recorded against a portion of the deferred tax asset related to the U.S. state NOL carryforwards in 2020 of $1.9 million. Deferred tax assets and liabilities include SPCs the Company participates in at Inova Re, net of a valuation allowance of $0.5 million and $0.6 million at December 31, 2020 and 2019, respectively. Due to the limited operations of these SPCs as of December 31, 2020 and 2019, management concluded that a valuation allowance was required against the DTAs of certain SPCs. The nominal decrease in the valuation allowance related to the SPCs at Inova Re is due to current year activity. ProAssurance files income tax returns in various states, the U.S. federal jurisdiction and the U.K. ProAssurance had a receivable for U.S. federal and U.K. income taxes of $18.9 million at December 31, 2020 and $8.0 million at December 31, 2019, both carried as a part of other assets. The statute of limitations is now closed for all tax years prior to 2017. A reconciliation of the beginning and ending amounts of unrecognized tax benefits for 2020, 2019 and 2018, were as follows: (In thousands) 2020 2019 2018 Balance at January 1 $ 5,070 $ 3,601 $ 5,341 Increases for tax positions taken during the current year — 1,749 — Decreases for tax positions taken during the current year (4,853) — (777) Increases for tax positions taken during prior years 5,342 — — Decreases for tax positions taken during prior years — — (800) Decreases relating to a lapse of the applicable statute of limitations (360) (280) (163) Balance at December 31 $ 5,199 $ 5,070 $ 3,601 At December 31, 2020 and 2019, approximately $0.8 million and $1.2 million, respectively, of ProAssurance's uncertain tax positions, if recognized, would affect the effective tax rate. As with any uncertain tax position, there is a possibility that the ultimate benefit realized could differ from the estimate management has established. Management believes that it is reasonably possible that a portion of unrecognized tax benefits at December 31, 2020 may change during the next twelve months. However, an estimate of the change cannot be made at this time. ProAssurance recognizes interest and/or penalties related to income tax matters as a component of income tax expense. Interest and penalties recognized in the Consolidated Statements of Income and Comprehensive Income was nominal for each of the years ended December 31, 2020, 2019 and 2018. The accrued liability for interest was approximately $0.5 million and $0.6 million at December 31, 2020 and 2019, respectively. Income tax expense (benefit) for each of the years ended December 31, 2020, 2019 and 2018 consisted of the following: (In thousands) 2020 2019 2018 Provision for income taxes: Current expense (benefit) Federal and foreign $ (19,885) $ (2,147) $ (6,509) State (296) 982 301 Total current expense (benefit) (20,181) (1,165) (6,208) Deferred expense (benefit) Federal and foreign (20,476) (27,404) (11,765) State (672) (1,239) (59) Total deferred expense (benefit) (21,148) (28,643) (11,824) Total income tax expense (benefit) $ (41,329) $ (29,808) $ (18,032) A reconciliation of “expected” income tax expense (benefit) to actual income tax expense (benefit) for each of the years ended December 31, 2020, 2019 and 2018 were as follows: (In thousands) 2020 2019 2018 Computed “expected” tax expense (benefit) $ (45,582) $ (6,049) $ 6,095 Tax-exempt income (1) (976) (1,528) (2,505) Tax credits (17,876) (21,933) (21,059) Non-U.S. operating results (1,307) (1,447) 2,269 Tax deficiency (excess tax benefit) on share-based compensation 457 99 (275) Tax rate differential on loss carryback (7,758) (3,400) — Goodwill impairment 31,413 — — Provision-to-return differences 1,217 3,595 (2,309) Change in uncertain tax positions (1,674) 1,956 (51) State income taxes (561) (376) 129 Benefit from amended returns — (550) — Other 1,318 (175) (326) Total income tax expense (benefit) $ (41,329) $ (29,808) $ (18,032) (1) Includes tax-exempt interest, dividends received deduction and change in cash surrender value of BOLI. The Company's pre-tax loss in 2020 included a $161.1 million goodwill impairment recognized in relation to the Specialty P&C reporting unit during the third quarter of 2020. Of the $161.1 million goodwill impairment, $149.6 million was non-deductible for which no tax benefit was recognized while the remaining $11.5 million was deductible for which a 21% tax benefit was recognized on the related tax amortization. See further discussion on this goodwill impairment in Notes 1 and 6. The tax rate differential on loss carryback for the year ended December 31, 2020 represents the additional tax rate differential of 14% on the carryback of the 2020 and 2019 NOLs to the 2015 and 2014 tax years, respectively, as a result of changes made by the CARES Act to the NOL provisions of the tax law (see further discussion in this section under the heading "Coronavirus Aid, Relief and Economic Security Act"). Tax Cuts and Jobs Act The TCJA introduced a minimum tax on payments made to related foreign entities referred to as the BEAT. The BEAT is imposed by adding back into the U.S. tax base any base erosion payment made by the U.S. taxpayer to a related foreign entity and applying a minimum tax rate to this newly calculated modified taxable income. Base erosion payments represent any amount paid or accrued by the U.S. taxpayer to a related foreign entity for which a deduction is allowed. Premiums the Company cedes to the SPCs at Inova Re, one of its other wholly owned Cayman Islands reinsurance subsidiaries, do not fall within the scope of base erosion payments as the SPCs at Inova Re have elected to be taxed as U.S. taxpayers. However, premiums the Company cedes to any active SPC at its wholly owned Cayman Islands reinsurance subsidiary, Eastern Re, fall within the scope of base erosion payments and therefore could be significantly impacted by the BEAT. See further discussion on the Company’s Cayman Islands SPC operations in Note 16. Management has evaluated its exposure to the BEAT and has concluded that the Company’s expected outbound deductible payments to related foreign entities are below the threshold for application of the BEAT; therefore, ProAssurance has not recognized any incremental tax expense for the BEAT provision of the TCJA during the years ended December 31, 2020 or 2019. The TCJA also requires a U.S. shareholder of a controlled foreign corporation to include its GILTI in U.S. taxable income. The GILTI amount is based on the U.S. shareholder’s aggregate share of the gross income of the controlled foreign corporation reduced by certain exceptions and a net deemed tangible income return. The net deemed tangible income return is based on the controlled foreign corporation’s basis in the tangible depreciable business property. Cell rental fee income earned by Inova Re and Eastern Re fall within the scope of the GILTI provisions of the TCJA. Management has evaluated the new GILTI provisions of the TCJA, and has made an accounting policy election to treat the taxes due on the inclusion of GILTI in U.S. taxable income as a current period expense when incurred. ProAssurance recognized a nominal amount of tax expense for the GILTI provision of the TCJA during each of the years ended December 31, 2020 and 2019. Coronavirus Aid, Relief and Economic Security Act In response to COVID-19, the CARES Act was signed into law on March 27, 2020 and contains several provisions for corporations and eases certain deduction limitations originally imposed by the TCJA. The CARES Act, among other things, includes temporary changes regarding the prior and future utilization of NOLs, temporary changes to the prior and future limitations on interest deductions, temporary suspension of certain payment requirements for the employer portion of Social Security taxes and the creation of certain refundable employee retention credits. ProAssurance has an NOL of approximately $45.3 million from the 2020 tax year that will be carried back to the 2015 tax year and is expected to generate a tax refund of approximately $15.9 million. Additionally, ProAssurance had an NOL of approximately $25.6 million from the 2019 tax year which was carried back to the 2014 tax year and generated a tax refund of approximately $9.0 million which we received in February 2021. ProAssurance has evaluated the other provisions of the CARES Act and has concluded that they will not have a material impact on the Company's financial position or results of operations. |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill Goodwill is recognized in conjunction with business acquisitions as the excess of the purchase consideration for the business acquisition over the fair value of identifiable assets acquired and liabilities assumed. The fair value of identifiable assets and liabilities, and thus goodwill, is subject to redetermination within a measurement period of up to one year following completion of a business acquisition. Goodwill is tested for impairment annually or more frequently if circumstances indicate an impairment may have occurred. The date of the Company's annual goodwill impairment test is October 1. Impairment of goodwill is tested at the reporting unit level, which is consistent with the Company's reportable segments identified in Note 16. Of the Company's five reporting units, three have goodwill - Specialty P&C, Workers' Compensation Insurance and Segregated Portfolio Cell Reinsurance. As discussed in Note 1, during the third quarter of 2020 the Company recorded a pre-tax impairment charge of $161.1 million to fully impair the goodwill in the Specialty P&C reporting unit. The Company performed its annual goodwill impairment assessment as of October 1, 2020. Management concluded that it was not more likely than not that the fair value of each of the Company's two reporting units that have net goodwill was less than the carrying value of each reporting unit as of the testing date; therefore, no goodwill impairment was recorded during the fourth quarter of 2020. There were no changes in the carrying amount of goodwill or accumulated impairment losses for the year ended December 31, 2019. The table below presents the carrying amount of goodwill and accumulated impairment losses by reporting unit at December 31, 2020: Reporting Unit (In thousands) Specialty P&C Workers' Compensation Insurance Segregated Portfolio Cell Reinsurance Total Goodwill, gross as of January 1, 2020 $ 161,115 $ 44,110 $ 5,500 $ 210,725 Accumulated impairment losses* (161,115) — — (161,115) Goodwill, net as of December 31, 2020 $ — $ 44,110 $ 5,500 $ 49,610 *Accumulated impairment losses represents the pre-tax impairment loss of $161.1 million recognized in relation to the Specialty P&C reporting unit during the third quarter of 2020 . There were no other impairment losses taken prior to 2020. |
Deferred Policy Acquisition Cos
Deferred Policy Acquisition Costs | 12 Months Ended |
Dec. 31, 2020 | |
Insurance [Abstract] | |
Deferred Policy Acquisition Costs | Deferred Policy Acquisition Costs Policy acquisition costs that are incremental and directly related to the successful production of new and renewal insurance contracts, most significantly agent commissions, premium taxes, and underwriting salaries and benefits, are capitalized as policy acquisition costs and amortized to expense, net of ceding commissions earned, as the related premium revenues are earned. Amortization of DPAC was $110.6 million, $115.3 million and $104.5 million for the years ended December 31, 2020, 2019 and 2018, respectively. ProAssurance evaluates the recoverability of DPAC typically at the segment level each reporting period, or in a manner that is consistent with the way the Company manages its business. Any amounts estimated to be unrecoverable are charged to expense in the current period as a component of DPAC amortization in the Consolidated Statement of Income and Comprehensive Income. As part of the evaluation of the recoverability of DPAC, ProAssurance also evaluates its unearned premiums for premium deficiencies. A premium deficiency is recognized if the sum of anticipated losses and loss adjustment expenses, unamortized DPAC and maintenance costs, net of anticipated investment income, exceeds the related unearned premium. If a premium deficiency is identified, the associated DPAC is charged to expense as a component of DPAC amortization in the Consolidated Statement of Income and Comprehensive Income, and a PDR is recorded for the excess deficiency as a component of net losses and loss adjustment expenses in the Consolidated Statement of Income and Comprehensive Income and as a component of the reserve for losses on the Consolidated Balance Sheet. For the years ended December 31, 2020 and 2018, ProAssurance did not determine any DPAC to be unrecoverable. For the year ended December 31, 2019, ProAssurance established a $9.2 million PDR and a nominal amount of DPAC was charged to expense as it was determined to be unrecoverable. The $9.2 million PDR was fully amortized during 2020. |
Reserve for Losses and Loss Adj
Reserve for Losses and Loss Adjustment Expenses | 12 Months Ended |
Dec. 31, 2020 | |
Insurance [Abstract] | |
Reserve for Losses and Loss Adjustment Expenses | Reserve for Losses and Loss Adjustment Expenses The reserve for losses is established based on estimates of individual claims and actuarially determined estimates of future losses based on ProAssurance’s past loss experience, available industry data and projections as to future claims frequency, severity, inflationary trends and settlement patterns. Estimating the reserve, particularly the reserve appropriate for liability exposures, is a complex process. For a high proportion of the risks insured or reinsured by ProAssurance, claims may be resolved over an extended period of time, often five years or more, and may be subject to litigation. Estimating losses requires ProAssurance to make and revise judgments and assessments regarding multiple uncertainties over an extended period of time. As a result, the reserve estimate may vary considerably from the eventual outcome. The assumptions used in establishing ProAssurance’s reserve are regularly reviewed and updated by management as new data becomes available. Changes to estimates of previously established reserves are included in earnings in the period in which the estimate is changed. ProAssurance believes that the methods it uses to establish reserves are reasonable and appropriate. Each year, ProAssurance uses internal actuaries to review the reserve for losses of each insurance subsidiary. ProAssurance also engages consulting actuaries to review ProAssurance claims data and provide observations regarding cost trends, rate adequacy and ultimate loss costs. The statutory filings of each insurance company with the insurance regulators must be accompanied by a consulting actuary's certification as to their respective reserves. ProAssurance considers the views of the actuaries as well as other factors, such as premium rates, historical paid and incurred loss development trends and an evaluation of the current loss environment including frequency, severity, the expected effect of inflation, general economic and social trends, and the legal and political environment in establishing the amount of its reserve for losses. As of December 31, 2020, the Company expects there will be impacts to these factors as well as to the timing of loss emergence and ultimate loss ratios for certain coverages it underwrites as a result of COVID-19 and the related economic shutdown; however, the extent to which COVID-19 impacts these factors is highly uncertain and cannot be predicted. The industry is experiencing new conditions, including the postponement of court cases, changes in settlement trends and a significant reduction in economic activity and insured exposure in some classes. ProAssurance's booked reserves as of December 31, 2020 include consideration of these factors, but the duration and degree to which these issues persist, along with potential legislative, regulatory or judicial actions, could result in significant changes to the Company's reserve estimates in future periods. ProAssurance partitions its reserve by accident year, which is the year in which the claim becomes its liability. For claims-made policies, the insured event generally becomes a liability when the event is first reported to the Company. For occurrence policies, the insured event becomes a liability when the event takes place. For retroactive coverages, the insured event becomes a liability at inception of the underlying contract. As claims are incurred (reported) and claim payments are made, they are aggregated by accident year for analysis purposes. ProAssurance also partitions its reserve by reserve type: case reserves and IBNR reserves. Case reserves are established by the claims department based upon the particular circumstances of each reported claim and represent ProAssurance’s estimate of the future loss costs (often referred to as expected losses) that will be paid on reported claims. Case reserves are decremented as claim payments are made and are periodically adjusted upward or downward as estimates regarding the amount of future losses are revised; a reported loss for an individual claim equates to the case reserve at any point in time plus the claim payments that have been made to date. IBNR reserves represent an estimate, in the aggregate, of future development on losses that have been reported to ProAssurance plus an estimate of losses that have been incurred but not reported. Development of Prior Accident Years In addition to setting the initial reserve for the current accident year, each period ProAssurance reassesses the amount of reserve required for prior accident years. The foundation of ProAssurance’s reserve re-estimation process is an actuarial analysis that is performed by both the internal and consulting actuaries. This detailed analysis projects ultimate losses based on partitions which include line of business, geography, coverage layer and accident year. The procedure uses the most representative data for each partition, capturing its unique patterns of development and trends. ProAssurance believes that the use of consulting actuaries provides an independent view of the loss data as well as a broader perspective on industry loss trends. Reserving Methodologies For the HCPL, Medical Technology Liability and Workers’ Compensation lines of business, the analysis performed by the consulting actuaries analyzes each partition of the business in a variety of ways and uses multiple actuarial methodologies in performing these analyses, including: Bornhuetter-Ferguson (Paid and Reported) Method, Paid Development Method, Reported (Incurred) Development Method, Average Paid Value Method and Average Reported Value Method. Generally, methods such as the Bornhuetter-Ferguson Method are used on more recent accident years where there is less data available on which to base the analysis. As time progresses and an increased amount of data is available for a given accident year, management gives more confidence to the development and average methods, as these methods typically rely more heavily on ProAssurance's own historical data. These methods emphasize different aspects of loss reserve estimation and provide a variety of perspectives for ProAssurance's decisions. For the Workers’ Compensation line of business in both the Workers' Compensation Insurance and Segregated Portfolio Cell Reinsurance segments, ProAssurance utilizes the Reported (Incurred) Development Method, Paid Loss Development Method and Bornhuetter-Ferguson Method, to develop the reserve for each accident year. The actuarial review includes the stratification of claims data (lost time claims and medical only claims) using different variations that allow for identification of trends that may not be readily identifiable if the data was evaluated only in the aggregate. Reported and paid loss development factors are key assumptions in the reserve estimation process and are based on ProAssurance’s historical reported and paid loss development patterns. As accident years mature, the various actuarial methodologies produce more consistent loss estimates. For the Lloyd’s Syndicates segment business, losses are initially estimated using the loss assumptions by risk category incorporated into the business plan submitted to Lloyd’s with consideration given to loss experience incurred to date. These assumptions were influenced by loss results reflected in Lloyd’s historical data for similar risks. As losses are reported and resolved and loss experience becomes more credible from a statistical perspective, actual loss experience is incorporated into the estimates. Certain of the methodologies utilized to estimate the ultimate losses for each partition of the reserve consider the actual amounts paid. Paid data is particularly influential when a large portion of known claims have been closed, as is the case for older accident years. In selecting a point estimate for each partition, management considers the extent to which trends are emerging consistently for all partitions and known industry trends. Thus, actual, rather than estimated severity trends are given more consideration. If actual severity trends are lower than those estimated at the time that reserves were previously established, the recognition of favorable development is indicated. This is particularly true for older accident years where actuarial methodologies give more weight to actual loss costs (severity). The various actuarial methods discussed above are applied in a consistent manner from period to period. In addition, ProAssurance performs statistical reviews of claims data such as claim counts, average settlement costs and severity trends when establishing the reserve. Selected point estimates of ultimate losses are utilized to develop estimates of ultimate losses recoverable from reinsurers, based on the terms and conditions of ProAssurance’s reinsurance agreements. An overall estimate of the amount receivable from reinsurers is determined by combining the individual estimates. ProAssurance’s net reserve estimate is the gross reserve point estimate less the estimated reinsurance recovery. Activity in the reserve for losses and loss adjustment expenses is summarized as follows: (In thousands) 2020 2019 2018 Balance, beginning of year $ 2,346,526 $ 2,119,847 $ 2,048,381 Less reinsurance recoverables on unpaid losses and loss adjustment expenses 390,708 343,820 335,585 Net balance, beginning of year 1,955,818 1,776,027 1,712,796 Net losses: Current year (1)(2)(3) 711,846 765,698 685,326 Favorable development of reserves established in prior years, net (50,399) (11,783) (92,116) Total 661,447 753,915 593,210 Paid related to: Current year (83,204) (115,133) (117,268) Prior years (501,969) (458,991) (412,711) Total paid (585,173) (574,124) (529,979) Net balance, end of year 2,032,092 1,955,818 1,776,027 Plus reinsurance recoverables on unpaid losses and loss adjustment expenses 385,087 390,708 343,820 Balance, end of year $ 2,417,179 $ 2,346,526 $ 2,119,847 (1) Current year net losses for the year ended December 31, 2019 included incurred losses of $2.1 million related to a loss portfolio transfer entered into during 2019 in the Specialty P&C segment. Current year net losses in 2018 included incurred losses of $25.4 million related to a loss portfolio transfer entered into during the second quarter of 2018, also in the Specialty P&C segment. (2) Current year net losses for the year ended December 31, 2019 included a PDR of $9.2 million associated with the unearned premium of a large national healthcare account's claims-made policy in the Specialty P&C segment. Current year net losses for the year ended December 31, 2020 included the amortization of the aforementioned $9.2 million PDR which offsets the impact of the losses incurred associated with the premium earned related to the large national healthcare account's claims-made policy. For additional information regarding the PDR see Note 7. (3) During 2020, the aforementioned large national healthcare account did not renew on terms offered by the Company and exercised its contractual option to purchase extended reporting endorsement or "tail" coverage. As a result, ProAssurance recognized total current year losses of $60.0 million (assumes a full limit loss) within the Specialty P&C segment for the year ended December 31, 2020. As discussed in Note 1, estimating liability reserves is complex and requires the use of many assumptions. As time passes and ultimate losses for prior years are either known or become subject to a more precise estimation, ProAssurance increases or decreases the reserve estimates established in prior periods. The net favorable loss development recognized in 2020 primarily reflected a lower than anticipated claims severity trend (i.e., the average size of a claim) in the Specialty P&C segment, primarily related to the 2014 through 2017 accident years. The net favorable development also reflected overall favorable trends in claim closing patterns in the Segregated Portfolio Cell Reinsurance and Workers' Compensation Insurance segments. The net favorable loss development recognized in the Segregated Portfolio Cell Reinsurance segment primarily related to the 2014 through 2019 accident years and the net favorable loss development recognized in the Workers' Compensation Insurance segment primarily related to the 2014 through 2017 accident years. The net favorable loss development recognized for the year ended December 31, 2019 primarily reflected overall favorable trends in claim closing patterns in the Workers' Compensation Insurance and Segregated Portfolio Cell Reinsurance segments, largely offset by net unfavorable loss development recognized in the Specialty P&C segment. The net favorable loss development recognized in the Workers' Compensation Insurance segment primarily related to the 2015 and 2016 accident years and the net favorable loss development recognized in the Segregated Portfolio Cell Reinsurance segment primarily related to the 2015 through 2018 accident years. The net unfavorable loss development recognized in the Specialty P&C segment primarily related to accident years 2016 through 2018. The favorable loss development recognized in 2018 primarily reflected a lower than anticipated claims severity trend for accident years 2011 through 2015. Claims Development ProAssurance establishes its reserve and manages claims activity by coverage, product or line of business and various categories of reserves have similar characteristics. Therefore, ProAssurance has aggregated these reserve categories into several reserve groups in the following disclosures and tables that provide a more meaningful view of the amount, timing and uncertainty of cash flows arising from the liability. At the same time, these reserve groups present a disaggregated view of the major elements of the overall loss reserve liability. The reserve groups include HCPL claims-made reserve, HCPL occurrence reserve, Medical Technology Liability claims-made reserve, Workers’ Compensation Insurance reserve, Segregated Portfolio Cell Reinsurance - workers' compensation reserve, Syndicate 1729 casualty reserve, Syndicate 1729 property insurance reserve and Syndicate 1729 property reinsurance reserve. All other loss reserve categories are deemed to be less homogeneous or relatively small on a standalone basis and are included in other short-duration lines in the claims development reconciliation. The composition of the reserve groups is based on similar characteristics with respect to the risks being insured and the reporting and payout pattern of the underlying claims. In most instances the groups follow the coverage categorizations used in statutory financial reporting for U.S.-domiciled property-casualty insurance companies. HCPL claims are disaggregated into those claims covered by claims-made policies and those claims covered by occurrence policies. For claims-made policies, the insured event generally becomes a liability when the event is first reported to the insurer. For occurrence policies, the insured event becomes a liability when the event takes place, even if unknown at that time. Claims-made coverage has a short reporting pattern, with virtually all claims known shortly after the end of the policy period. Occurrence coverage claims can have an extended reporting pattern, with the time from the loss event until the filing of the claim often measured in years, at which point the claims resolution process begins. Although the resolution process and time frame is similar once a claim is reported, combining claims from claims-made and occurrence coverage types would result in distortion due to the difference in reporting lag. Medical Technology Liability reserves are grouped separately due to the nature of the risk, including the potential for mass torts and multiple claims arising out of the same product or service. The small amount of Medical Technology Liability occurrence reserves are included in other short-duration lines. Workers' compensation reserves in the Workers' Compensation Insurance and the Segregated Portfolio Cell Reinsurance segments are each grouped separately due to the difference in the type of coverage provided and the differences in the claims resolution process as compared to other liability insurance. The small amount of HCPL reserves in the Segregated Portfolio Cell Reinsurance segment are included in other short-duration lines. Finally, claims arising from the Company's participation in Syndicate 1729 are segregated into casualty (insurance and reinsurance), property insurance and property reinsurance groups. Property insurance claims generally have a shorter reporting and resolution time frame as compared to most casualty claims. The reporting and resolution patterns of property reinsurance claims differs from that of property insurance claims due to predominant coverage of catastrophic loss events on an aggregate basis rather than coverage of individual claims. Casualty reinsurance, on the other hand, generally provides coverage on a per-claim basis and the reporting and resolution time frame for these claims is not substantially different than those arising from casualty insurance written by Syndicate 1729. The small amount of reserves associated with the Company's participation in Syndicate 6131 related to contingency and special property business are included in other short-duration lines. ProAssurance has elected to present reserve history for acquired entities in all periods shown in the tables below, including periods prior to acquisition. With the exception of the Workers' Compensation Insurance and Segregated Portfolio Cell Reinsurance - workers' compensation lines of business, virtually all other acquired entities are captured within the HCPL line of business. All information prior to 2020 disclosed in the Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance, Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance and Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance tables that follow is presented as supplementary information. The “Cumulative Number of Reported Claims” in the tables that follow includes the combined number of claims for an accident year and excludes projected unreported IBNR claims. A claim is considered reported when ProAssurance becomes aware of and accepts it for coverage under the terms of the Company's insurance contracts. Healthcare Professional Liability Reserve HCPL loss costs are impacted by many factors, including but not limited to the nature of the claim, including whether or not the claim is an individual or a mass tort claim, the personal situation of the claimant or the claimant's family, the outcome of jury trials, the legislative and judicial climate where any potential litigation may occur, general economic and social conditions and, for claims involving bodily injury, the trend of healthcare costs. ProAssurance sets an initial reserve based upon the evaluation of the current loss environment including frequency, severity, the expected effect of inflation, general economic and social trends, and the legal and political environment. The initial loss ratio for HCPL business has ranged from 87% to 106% in recent years and has recently trended towards the higher end of this range due to increased reserve estimates for a large national healthcare account as well as increases in loss severity in the broader HCPL industry, including our Specialty line of business. Healthcare Professional Liability Claims-Made Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR* Cumulative Number of Reported Claims 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 348,916 $ 344,808 $ 331,884 $ 305,540 $ 289,400 $ 278,258 $ 264,777 $ 254,329 $ 253,163 $ 251,440 $ (1,522) 3,530 2012 — $ 341,289 $ 324,418 $ 319,613 $ 306,956 $ 291,075 $ 279,589 $ 271,110 $ 266,629 264,932 $ (180) 3,699 2013 — — $ 315,346 $ 304,209 $ 296,550 $ 287,140 $ 272,364 $ 258,251 $ 248,594 249,477 $ (2,266) 3,770 2014 — — — $ 290,020 $ 289,397 $ 280,043 $ 267,442 $ 256,968 $ 244,607 237,091 $ (3,596) 3,316 2015 — — — — $ 276,492 $ 269,980 $ 271,138 $ 270,814 $ 256,785 256,082 $ (8,109) 3,267 2016 — — — — — $ 271,765 $ 274,643 $ 287,551 $ 293,515 287,142 $ (5,250) 3,475 2017 — — — — — — $ 283,746 $ 295,883 $ 331,304 325,919 $ (11,542) 3,719 2018 — — — — — — — $ 320,772 $ 377,908 376,111 $ (26,964) 4,150 2019 — — — — — — — — $ 377,242 374,525 $ 69,993 3,574 2020 — — — — — — — — — 326,152 $ 203,515 2,475 Total $ 2,948,871 * Includes expected development on reported claims Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 14,417 $ 71,208 $ 133,004 $ 177,089 $ 198,112 $ 214,502 $ 224,982 $ 233,103 $ 237,605 $ 242,034 2012 — $ 15,382 $ 73,571 $ 145,488 $ 190,997 $ 215,220 $ 231,652 $ 244,512 $ 250,806 256,802 2013 — — $ 16,938 $ 69,657 $ 127,496 $ 171,681 $ 197,265 $ 213,879 $ 220,402 231,930 2014 — — — $ 16,764 $ 59,485 $ 116,791 $ 154,236 $ 186,239 $ 200,392 210,534 2015 — — — — $ 9,172 $ 55,731 $ 111,741 $ 161,896 $ 195,047 218,066 2016 — — — — — $ 9,027 $ 51,869 $ 109,756 $ 164,811 203,390 2017 — — — — — — $ 16,309 $ 63,171 $ 134,787 173,183 2018 — — — — — — — $ 14,051 $ 79,291 141,609 2019 — — — — — — — — $ 17,838 66,843 2020 — — — — — — — — — 14,100 Total 1,758,491 All outstanding liabilities before 2011, net of reinsurance 16,866 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 1,207,246 Healthcare Professional Liability Occurrence Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR* Cumulative Number of Reported Claims 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 45,882 $ 44,956 $ 41,453 $ 39,917 $ 37,150 $ 35,004 $ 32,343 $ 29,784 $ 27,533 $ 27,287 $ (254) 344 2012 — $ 45,703 $ 46,513 $ 44,848 $ 40,692 $ 34,774 $ 32,691 $ 29,857 $ 25,705 26,533 $ 143 400 2013 — — $ 32,746 $ 36,602 $ 35,624 $ 34,393 $ 30,906 $ 26,919 $ 24,857 24,782 $ 74 360 2014 — — — $ 30,420 $ 29,918 $ 32,143 $ 29,869 $ 25,885 $ 22,243 22,048 $ 362 347 2015 — — — — $ 35,648 $ 35,347 $ 37,346 $ 40,960 $ 36,468 33,262 $ (1,059) 361 2016 — — — — — $ 29,609 $ 28,790 $ 27,240 $ 25,019 29,426 $ 2,174 373 2017 — — — — — — $ 24,571 $ 23,760 $ 21,148 21,498 $ 5,199 415 2018 — — — — — — — $ 38,420 $ 41,555 40,304 $ 11,413 389 2019 — — — — — — — — $ 35,420 34,093 $ 20,945 339 2020 — — — — — — — — — 92,958 $ 90,916 130 Total $ 352,191 * Includes expected development on reported claims Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 291 $ 2,803 $ 8,059 $ 16,544 $ 19,197 $ 21,416 $ 23,194 $ 24,539 $ 24,933 $ 25,111 2012 — $ 363 $ 2,430 $ 7,705 $ 12,212 $ 19,275 $ 21,435 $ 23,095 $ 23,600 24,138 2013 — — $ 369 $ 3,170 $ 7,826 $ 14,753 $ 16,787 $ 18,949 $ 21,241 21,954 2014 — — — $ 394 $ 2,260 $ 7,460 $ 10,519 $ 14,604 $ 17,024 17,708 2015 — — — — $ (350) $ 786 $ 4,854 $ 11,626 $ 15,462 22,455 2016 — — — — — $ (182) $ (195) $ 2,883 $ 10,576 17,918 2017 — — — — — — $ (6,809) $ (5,858) $ (2,765) 1,313 2018 — — — — — — — $ 65 $ 2,098 8,562 2019 — — — — — — — — $ 439 3,167 2020 — — — — — — — — — 60 Total 142,386 All outstanding liabilities before 2011, net of reinsurance 6,115 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 215,920 Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance Years 1 2 3 4 5 6 7 8 9 10 Unaudited Healthcare Professional Liability Claims-Made 5.0% 18.0% 22.5% 17.0% 11.3% 6.9% 4.0% 3.4% 2.0% 1.8% Healthcare Professional Liability Occurrence (2.6%) 6.4% 16.8% 22.2% 16.6% 11.4% 6.3% 3.2% 1.7% 0.7% Medical Technology Liability Reserve The risks insured in the Medical Technology Liability line of business are more varied, and policies are individually priced based on the risk characteristics of the policy and the account. These policies often have substantial deductibles or self-insured retentions, and the insured risks range from startup operations to large multinational entities. Premiums are established using the most recently developed actuarial estimates of losses expected to be incurred based on factors which include: results from prior analysis of similar business, industry indications, observed trends and judgment. Claims in this line of business primarily involve bodily injury to individuals and are affected by factors similar to those of the HCPL line of business. For the Medical Technology Liability line of business, ProAssurance also establishes an initial reserve using a loss ratio approach, including a provision in consideration of historical loss volatility that this line of business has exhibited. Medical Technology Liability Claims-Made Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR* Cumulative Number of Reported Claims 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 17,249 $ 20,930 $ 19,166 $ 15,836 $ 13,794 $ 12,487 $ 12,358 $ 8,202 $ 7,944 $ 7,725 $ 60 522 2012 — $ 11,162 $ 9,989 $ 8,906 $ 7,441 $ 5,824 $ 4,797 $ 5,051 $ 3,889 3,868 $ 51 223 2013 — — $ 9,807 $ 9,955 $ 9,536 $ 7,226 $ 4,697 $ 3,566 $ 3,504 3,305 $ 201 218 2014 — — — $ 9,989 $ 10,306 $ 9,012 $ 8,984 $ 7,679 $ 6,194 5,888 $ 396 272 2015 — — — — $ 9,376 $ 8,757 $ 7,193 $ 5,929 $ 5,081 4,664 $ 1,194 156 2016 — — — — — $ 9,200 $ 8,467 $ 7,413 $ 6,422 6,241 $ 1,374 182 2017 — — — — — — $ 11,049 $ 10,143 $ 8,306 4,919 $ 2,017 99 2018 — — — — — — — $ 10,141 $ 8,108 7,506 $ 4,595 218 2019 — — — — — — — — $ 10,072 8,324 $ 4,830 354 2020 — — — — — — — — — 11,082 $ 10,497 154 Total $ 63,522 * Includes expected development on reported claims Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 118 $ 2,034 $ 3,846 $ 5,062 $ 7,376 $ 7,240 $ 7,799 $ 7,664 $ 7,665 $ 7,665 2012 — $ 568 $ 1,520 $ 2,805 $ 3,247 $ 3,366 $ 3,676 $ 3,800 $ 3,817 3,817 2013 — — $ 102 $ 1,029 $ 1,967 $ 2,599 $ 3,092 $ 3,102 $ 3,102 3,102 2014 — — — $ 388 $ 1,527 $ 2,564 $ 3,046 $ 3,724 $ 3,776 4,074 2015 — — — — $ 25 $ 440 $ 1,625 $ 2,097 $ 2,567 2,911 2016 — — — — — $ 53 $ 1,690 $ 2,365 $ 2,959 4,295 2017 — — — — — — $ 56 $ 1,681 $ 2,017 2,360 2018 — — — — — — — $ 6 $ 191 1,850 2019 — — — — — — — — $ 584 2,552 2020 — — — — — — — — — 40 Total 32,666 All outstanding liabilities before 2011, net of reinsurance 351 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 31,207 Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance Years 1 2 3 4 5 6 7 8 9 10 Unaudited Medical Technology Liability 3.6 % 21.2 % 21.0 % 11.6 % 15.2 % 3.0 % 3.9 % (0.4 %) — % — % Workers' Compensation Insurance Reserve Many factors affect the ultimate losses incurred for the workers' compensation coverages in the Workers' Compensation Insurance segment including, but not limited to, the type and severity of the injury, the age and occupation of the injured worker, the estimated length of disability, medical treatment and related costs, and the jurisdiction and workers' compensation laws of the injury occurrence. ProAssurance uses various actuarial methodologies in developing the workers’ compensation reserve combined with a review of the exposure base generally based upon payroll of the insured. For the current accident year, given the lack of seasoned information, the different actuarial methodologies produce results with considerable variability; therefore, more emphasis is placed on supplementing results from the actuarial methodologies with trends in exposure base, medical expense inflation, general inflation, severity, and claim counts, among other things, to select an expected loss ratio. Workers' Compensation Insurance Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR* Cumulative Number of Reported Claims 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 65,665 $ 65,783 $ 71,521 $ 72,280 $ 72,420 $ 72,495 $ 72,495 $ 72,495 $ 72,445 $ 72,445 $ 21 15,245 2012 — $ 80,285 $ 76,551 $ 75,848 $ 76,357 $ 75,836 $ 75,576 $ 75,076 $ 75,076 75,076 $ 672 16,204 2013 — — $ 86,973 $ 85,935 $ 86,928 $ 88,010 $ 87,260 $ 87,260 $ 89,760 89,560 $ 983 16,429 2014 — — — $ 93,019 $ 93,529 $ 93,029 $ 93,029 $ 93,029 $ 93,029 91,329 $ 1,594 16,210 2015 — — — — $ 100,101 $ 100,454 $ 98,454 $ 97,654 $ 96,354 93,054 $ 2,248 16,550 2016 — — — — — $ 101,348 $ 97,348 $ 92,148 $ 84,799 82,799 $ 2,149 15,978 2017 — — — — — — $ 99,874 $ 99,874 $ 99,874 97,874 $ 4,581 16,083 2018 — — — — — — — $ 118,095 $ 118,095 120,095 $ 2,054 18,009 2019 — — — — — — — — $ 119,752 119,752 $ 9,768 17,517 2020 — — — — — — — — — 106,145 $ 35,455 13,994 Total $ 948,129 * Includes expected development on reported claims Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 21,993 $ 50,900 $ 62,307 $ 67,945 $ 70,146 $ 70,934 $ 71,662 $ 71,856 $ 71,927 $ 72,013 2012 — $ 27,448 $ 56,122 $ 65,908 $ 70,558 $ 72,766 $ 73,662 $ 73,676 $ 73,768 73,851 2013 — — $ 30,554 $ 63,825 $ 76,813 $ 82,369 $ 85,689 $ 86,783 $ 87,466 87,772 2014 — — — $ 30,368 $ 65,922 $ 77,631 $ 85,022 $ 87,314 $ 87,998 88,487 2015 — — — — $ 32,078 $ 65,070 $ 78,947 $ 83,483 $ 86,528 87,884 2016 — — — — — $ 28,377 $ 58,192 $ 69,237 $ 74,886 76,954 2017 — — — — — — $ 31,586 $ 70,333 $ 82,289 87,129 2018 — — — — — — — $ 41,619 $ 86,063 104,216 2019 — — — — — — — — $ 40,994 88,008 2020 — — — — — — — — — 33,431 Total 799,745 All outstanding liabilities before 2011, net of reinsurance 3,425 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 151,809 Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance Years 1 2 3 4 5 6 7 8 9 10 Unaudited Workers' Compensation Insurance 33.6 % 37.9 % 14.0 % 6.4 % 3.0 % 1.1 % 0.6 % 0.2 % 0.1 % 0.1 % Segregated Portfolio Cell Reinsurance - Workers' Compensation Reserve The Company estimates and reserves for the workers' compensation business assumed by the Segregated Portfolio Cell Reinsurance segment in the same manner as for its workers' compensation business in the Workers' Compensation Insurance segment, as previously discussed. Segregated Portfolio Cell Reinsurance - Workers' Compensation Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR* Cumulative Number of Reported Claims 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 18,790 $ 19,360 $ 19,629 $ 19,282 $ 18,644 $ 18,725 $ 18,666 $ 18,606 $ 18,522 $ 18,212 $ 27 3,154 2012 — $ 22,940 $ 21,513 $ 21,048 $ 20,028 $ 19,972 $ 19,864 $ 19,799 $ 19,727 19,602 $ 152 3,454 2013 — — $ 23,809 $ 25,310 $ 26,758 $ 26,619 $ 26,260 $ 26,033 $ 25,938 25,546 $ 104 3,723 2014 — — — $ 28,248 $ 28,423 $ 29,000 $ 28,373 $ 28,281 $ 27,919 27,482 $ 188 4,433 2015 — — — — $ 36,423 $ 32,519 $ 28,746 $ 27,548 $ 26,720 26,121 $ 372 4,949 2016 — — — — — $ 37,601 $ 34,055 $ 30,998 $ 29,424 28,437 $ 515 5,327 2017 — — — — — — $ 42,725 $ 38,594 $ 34,246 32,879 $ 775 5,706 2018 — — — — — — — $ 43,654 $ 41,283 40,017 $ 2,979 6,373 2019 — — — — — — — — $ 48,505 42,345 $ 6,461 6,081 2020 — — — — — — — — — 40,094 $ 16,479 5,587 Total $ 300,735 * Includes expected development on reported claims Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 5,940 $ 14,045 $ 17,197 $ 17,869 $ 18,054 $ 18,177 $ 18,176 $ 18,185 $ 18,185 $ 18,185 2012 — $ 7,808 $ 14,740 $ 17,728 $ 18,474 $ 19,208 $ 19,402 $ 19,328 $ 19,311 19,340 2013 — — $ 8,131 $ 19,054 $ 24,268 $ 25,209 $ 25,366 $ 25,489 $ 25,440 25,442 2014 — — — $ 9,933 $ 21,880 $ 26,173 $ 26,810 $ 26,959 $ 27,083 27,110 2015 — — — — $ 11,257 $ 21,706 $ 23,977 $ 24,781 $ 25,033 25,125 2016 — — — — — $ 10,980 $ 23,003 $ 26,285 $ 27,162 27,211 2017 — — |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies ProAssurance is involved in various legal actions related to insurance policies and claims handling including, but not limited to, claims asserted by policyholders. These types of legal actions arise in the Company's ordinary course of business and, in accordance with GAAP for insurance entities, are considered as a part of the Company's loss reserving process, which is described in detail under the heading "Losses and Loss Adjustment Expenses" in the Accounting Policies section in Note 1. ProAssurance also has other direct actions against the Company unrelated to its claims activity which are evaluated and accounted for as a part of other liabilities. For these corporate legal actions, the Company evaluates each case separately and establishes what it believes is an appropriate reserve based on GAAP guidance related to contingent liabilities. As of December 31, 2020 there were no material reserves established for corporate legal actions. As a member of Lloyd's, ProAssurance has obligations to Syndicate 1729 and Syndicate 6131 including a Syndicate Credit Agreement and FAL requirements. The Syndicate Credit Agreement is an unconditional revolving credit agreement to the Premium Trust Fund of Syndicate 1729 for the purpose of providing working capital with maximum permitted borrowings of £30.0 million (approximately $41.0 million at December 31, 2020). The Syndicate Credit Agreement has a maturity date of December 31, 2021 and contains an annual auto-renewal feature which allows for ProAssurance to elect to non-renew if notice is given at least 30 days prior to the next auto-renewal date, which is one year prior to the maturity date. Under the Syndicate Credit Agreement, advances bear interest at 3.8% annually and may be repaid at any time but are repayable upon demand after December 31, 2021, subject to extension through the auto-renewal feature. As of December 31, 2020, there were no outstanding borrowings under the Syndicate Credit Agreement. ProAssurance provides FAL to support underwriting by Syndicate 1729 and Syndicate 6131 and is comprised of investment securities and cash and cash equivalents deposited with Lloyd's with a total fair value of approximately $106.2 million at December 31, 2020 (see Note 3). During 2020, ProAssurance received a return of approximately $32.3 million of cash and cash equivalents from its FAL balances given the Company's reduced participation in the results of Syndicate 1729 for the 2020 underwriting year to 29% from 61%. ProAssurance has entered into financial instrument transactions that may present off-balance sheet credit risk or market risk. These transactions include a short-term loan commitment and commitments to provide funding to non-public investment entities. Under the short-term loan commitment, ProAssurance has agreed to advance funds on a 30 day basis to a counterparty provided there is no violation of any condition established in the contract. As of December 31, 2020, ProAssurance had total funding commitments related to non-public investment entities as well as the short-term loan commitment of approximately $196.7 million which included the amount at risk if the full short-term loan is extended and the counterparties default. However, the credit risk associated with the short-term loan commitment is minimal as the counterparties to the contract are highly rated commercial institutions and to-date have been performing in accordance with their contractual obligations. Of these total funding commitments, $0.7 million is related to qualified affordable housing project tax credit investments and is expected to be paid as follows: $0.3 million in 2021, $0.3 million in 2022 and 2023 combined and $0.1 million in 2024 and 2025 combined. ProAssurance’s expected credit losses associated with this short-term loan commitment were nominal in amount as of December 31, 2020. In October 2018, ProAssurance entered into an agreement with a company for a minimum commitment of two years to provide data analytics services for certain product lines within the Company's HCPL book of business. In October 2020, ProAssurance executed an amendment to this agreement which extended the commitment an additional one year for an annual fee of approximately $2.4 million and additional variable quarterly incentive fees based on service utilization metrics prescribed in the contract. In addition, the amended agreement includes an optional three-month extension feature if notice is given at least 30 days prior to the end of the contract. ProAssurance incurred operating expenses associated with this agreement of $4.3 million and $4.9 million for the years ended December 31, 2020 and 2019, respectively. As of December 31, 2020, the remaining commitment under this agreement was estimated to be approximately $1.8 million, which includes estimated variable quarterly incentive fees. ProAssurance has entered into a definitive agreement to acquire NORCAL, an underwriter of medical professional liability insurance, subject to the demutualization of NORCAL Mutual, NORCAL's ultimate controlling party. Upon satisfaction of the various remaining regulatory approvals required, both companies are anticipating to close the transaction in the second quarter of 2021. Subject to NORCAL’s conversion from a mutual company to a stock company, ProAssurance has agreed to acquire 100% of the converted company stock in exchange for base consideration of $450 million and contingent consideration of up to an additional $150 million depending on the development of NORCAL’s ultimate losses over a three-year period following the acquisition date. The actual final cost of the transaction could vary due to the ability of NORCAL’s policyholders to elect forms of consideration other than stock in the demutualization transaction as provided by California law. Those alternative consideration options are tied to an appraised value of NORCAL as determined by the California insurance regulator rather than the price per share ProAssurance has agreed to pay for 100% of NORCAL assuming that all policyholders elect to receive stock. Further, the transaction is subject to a number of closing conditions, including a maximum |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases ProAssurance is involved in a number of operating leases primarily for office facilities. Office facility leases have remaining lease terms ranging from one year to eleven years; some of which include options to extend the leases for up to fifteen years, and some of which include an option to terminate the lease within one year. ProAssurance subleases certain office facilities to third parties and classifies these leases as operating leases. The following table provides a summary of the components of net lease expense as well as the reporting location in the Consolidated Statements of Income and Comprehensive Income for the years ended December 31, 2020 and 2019. (In thousands) Location in the Consolidated Statements of Income and Comprehensive Income Year Ended December 31 2020 2019 Operating lease expense (1) Operating expense $ 4,355 $ 4,485 Sublease income (2) Other income (143) (152) Net lease expense $ 4,212 $ 4,333 (1) Includes short-term lease costs and variable lease costs, if applicable. For the years ended December 31, 2020 and 2019, no short-term lease costs were recognized and variable lease costs were nominal in amount. (2) Sublease income excludes rental income from owned properties of $2.5 million during each of the years ended December 31, 2020 and 2019, which is included in other income. See “Item 2. Properties” for a listing of currently owned properties. The following table provides supplemental lease information for operating leases on the Consolidated Balance Sheet as of December 31, 2020 and December 31, 2019. Year Ended December 31 ($ in thousands) 2020 2019 Operating lease ROU assets $ 19,013 $ 21,074 Operating lease liabilities $ 20,116 $ 22,051 Weighted-average remaining lease term 8.31 years 8.74 years Weighted-average discount rate 2.97 % 3.08 % The following table provides supplemental lease information for the Consolidated Statements of Cash Flows for the years ended December 31, 2020 and 2019. Year Ended December 31 (In thousands) 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 127 $ 976 The following table is a schedule of remaining future minimum lease payments for operating leases that had an initial or remaining non-cancellable lease term in excess of one year as of December 31, 2020. (In thousands) 2021 $ 4,145 2022 3,306 2023 2,608 2024 2,026 2025 1,783 Thereafter 8,875 Total future minimum lease payments 22,743 Less: Imputed interest 2,627 Total operating lease liabilities $ 20,116 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt ProAssurance’s outstanding debt consisted of the following: (In thousands) December 31, December 31, Senior Notes due 2023, unsecured, interest at 5.3% annually $ 250,000 $ 250,000 Mortgage Loans, outstanding borrowings are secured by first priority liens on two office buildings, and bear an interest rate of three-month LIBOR plus 1.325% (1.58% and 3.21%, respectively) determined on a quarterly basis. 36,113 37,617 Total principal 286,113 287,617 Less unamortized debt issuance costs 1,400 1,796 Debt less unamortized debt issuance costs $ 284,713 $ 285,821 Senior Notes due 2023 (the Senior Notes) The Senior Notes are the unsecured obligations of ProAssurance Corporation, due in full in November 2023, unless redeemed sooner, with interest payable semiannually. Redemptions may be made prior to maturity, in whole or part, at the greater of par or the sum of the present values of the outstanding principal and remaining interest payments calculated at 0.4% above the then current rate for U.S. Treasury Notes with a term comparable to the remaining term of the Senior Notes. There are no financial covenants associated with the Senior Notes. Mortgage Loans During 2017, two of ProAssurance's subsidiaries each entered into ten-year mortgage loans collectively totaling $40.5 million (Mortgage Loans) with one lender in connection with the recapitalization of two office buildings. The Mortgage Loans, which mature in December 2027, accrue interest at three-month LIBOR plus 1.325% with principal and interest payable on a quarterly basis. To manage the Company's exposure to increases in LIBOR on the Mortgage Loans, ProAssurance entered into an interest rate cap agreement with a notional amount of $35 million. Per the interest rate cap agreement, the Company is entitled to receive cash payments if and when the three-month LIBOR exceeds 2.35%. Additional information on the Company's derivative instruments is provided in Note 2. The Mortgage Loans contain customary representations, covenants and events constituting default, and remedies for default. Additionally, the Mortgage Loans carry the following financial covenant: (1) Each of the two ProAssurance subsidiaries are not permitted to have a leverage ratio of consolidated funded debt (principally, obligations for borrowed money, obligations for deferred purchase price of property or services, obligations evidenced by notes, bonds, debentures, standby and commercial letters of credit and contingent obligations of the subsidiary) to consolidated total capitalization (principally, SAP consolidated net worth plus consolidated funded debt of the subsidiary) greater than 0.35, determined at the end of each fiscal quarter. At December 31, 2020, contractual maturities of the Mortgages Loans for each of the next five years, excluding interest payments, are as follows: (In thousands) Principal Payments Due by Period 2021 $ 1,559 2022 1,617 2023 1,677 2024 1,740 2025 1,805 Thereafter 27,715 Total principal payments $ 36,113 Revolving Credit Agreement ProAssurance has a Revolving Credit Agreement with seven participating lenders. The Revolving Credit Agreement, which expires November 2024, may be used for general corporate purposes, including, but not limited to, short-term working capital, share repurchases as authorized by the Board and support for other activities. ProAssurance's Revolving Credit Agreement permits borrowings up to $250 million, and has available a $50 million accordion feature which, if successfully subscribed, would expand the permitted borrowings to a maximum of $300 million. The Revolving Credit Agreement permits ProAssurance to borrow, repay and reborrow from the lenders during the term of the Revolving Credit Agreement. All borrowings are required to be repaid prior to the expiration date of the Revolving Credit Agreement. ProAssurance is required to pay a commitment fee, ranging from 0.15% to 0.30% based on ProAssurance’s credit ratings, on the average unused portion of the credit line during the term of the Revolving Credit Agreement. Borrowings under the Revolving Credit Agreement may be secured or unsecured and accrue interest at a selected base rate, adjusted by a margin, which can vary from 0% to 1.88%, based on ProAssurance’s credit ratings and whether the borrowing is secured or unsecured. The base rate selected may either be the current one-, three- or six-month LIBOR, with the LIBOR term selected fixing the interest period for which the rate is effective. If no selection is made, the base rate defaults to the highest of (1) the Prime rate, (2) the Federal Funds rate plus 0.5% or (3) the one-month LIBOR plus 1.0%, determined daily. Rates are reset each successive interest period until the borrowing is repaid. The Revolving Credit Agreement contains customary representations, covenants and events constituting default, and remedies for default. Additionally, the Revolving Credit Agreement carries the following financial covenants: (1) ProAssurance is not permitted to have a leverage ratio of consolidated funded indebtedness (principally, obligations for borrowed money, obligations evidenced by instruments such as notes or acceptances, standby and commercial letters of credit, and contingent obligations) to consolidated total capitalization (principally, total non-trade liabilities on a consolidated basis plus consolidated shareholders’ equity, exclusive of AOCI) greater than 0.35 to 1.0, determined at the end of each fiscal quarter. (2) ProAssurance is required to maintain a minimum net worth, excluding AOCI, of at least $1.0 billion. Funds borrowed under the terms of the Revolving Credit Agreement will be used for general corporate purposes, including, but not limited to, use as short-term working capital, funding for share repurchases as authorized by the Board and support for other activities, such as the planned acquisition of NORCAL (see Note 9). Covenant Compliance ProAssurance is currently in compliance with all covenants. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity At December 31, 2020 and 2019, ProAssurance had 100 million shares of authorized common stock and 50 million shares of authorized preferred stock. The Board has the authority to determine provisions for the issuance of preferred shares, including the number of shares to be issued, the designations, powers, preferences and rights, and the qualifications, limitations or restrictions of such shares. The following is a summary of changes in common shares issued and outstanding during the years ended December 31, 2020, 2019 and 2018: (In thousands) 2020 2019 2018 Issued and outstanding shares - January 1 53,792 53,637 53,457 Shares issued due to vesting of share-based compensation awards 54 132 135 Other shares issued for compensation and shares reissued to stock purchase plan * 47 23 45 Issued and outstanding shares - December 31 53,893 53,792 53,637 * Shares issued were valued at fair value (the market price of a ProAssurance common share on the date of issue). As of December 31, 2020, approximately 1.6 million of ProAssurance's authorized common shares were reserved by the Board for award or issuance under the incentive compensation plans described in Note 13 and an additional 0.5 million of authorized common shares were reserved for the issuance of currently outstanding restricted share and performance share unit awards. ProAssurance declared cash dividends during 2020, 2019 and 2018 as follows: Cash Dividends Declared, per Share 2020 2019 2018 First Quarter $ 0.31 $ 0.31 $ 0.31 Second Quarter $ 0.05 $ 0.31 $ 0.31 Third Quarter $ 0.05 $ 0.31 $ 0.31 Fourth Quarter $ 0.05 $ 0.31 $ 0.31 Fourth Quarter - Special dividend $ — $ — $ 0.50 Quarterly dividends were paid in the month following the quarter in which they were declared. Dividends declared during 2020, 2019 and 2018 totaled $24.8 million, $66.7 million and $94.3 million, respectively. ProAssurance's ability to pay dividends to its shareholders is limited by its holding company structure, to the extent of the net assets held by its insurance subsidiaries, as discussed in Note 18. Otherwise, there are no other regulatory restrictions on ProAssurance's retained earnings or net income that materially impact its ability to pay dividends. Based on shareholders' equity at December 31, 2020, total equity of $266.6 million was free of debt covenant restrictions regarding the payment of dividends. However, any decision to pay future cash dividends is subject to the Board’s final determination after a comprehensive review of financial performance, future expectations and other factors deemed relevant by the Board. As of December 31, 2020, Board authorizations for the repurchase of common shares or the retirement of outstanding debt of $109.6 million remained available for use. The timing and quantity of purchases depends upon market conditions and changes in ProAssurance's capital requirements and is subject to limitations that may be imposed on such purchases by applicable securities laws and regulations as well as the rules of the NYSE. Other Comprehensive Income (Loss) and Accumulated Other Comprehensive Income (Loss) The following tables provide a detailed breakout of the components of AOCI and the amounts reclassified from AOCI to net income (loss). The tax effects of all amounts in the tables below, except for an immaterial amount of unrealized gains and losses on available-for-sale securities held at the Company's U.K. subsidiary, were computed using the enacted U.S. federal corporate tax rate of 21%. For the years ended December 31, 2020 and 2019, OCI included a deferred tax expense of $9.6 million and $14.2 million, respectively, and a deferred tax benefit of $9.6 million for the year ended December 31, 2018. The changes in the balance of each component of AOCI for the years ended December 31, 2020, 2019 and 2018 were as follows: (In thousands) Unrealized Investment Gains (Losses) Non-credit Impairments Unrecognized Change in Defined Benefit Plan Liabilities (1) Accumulated Other Comprehensive Income (Loss) Balance December 31, 2019 $ 37,333 $ (300) $ (78) $ 36,955 OCI, before reclassifications, net of tax 46,383 (187) (26) 46,170 Amounts reclassified from AOCI, net of tax (8,328) 430 — (7,898) Net OCI, current period 38,055 243 (26) 38,272 Balance December 31, 2020 $ 75,388 $ (57) $ (104) $ 75,227 (In thousands) Unrealized Investment Gains (Losses) Non-credit Impairments Unrecognized Change in Defined Benefit Plan Liabilities (1) Accumulated Other Comprehensive Income (Loss) Balance December 31, 2018 $ (16,733) $ (121) $ (57) $ (16,911) OCI, before reclassifications, net of tax 56,041 (179) (21) 55,841 Amounts reclassified from AOCI, net of tax (1,975) — — (1,975) Net OCI, current period 54,066 (179) (21) 53,866 Balance December 31, 2019 $ 37,333 $ (300) $ (78) $ 36,955 (In thousands) Unrealized Investment Gains (Losses) Non-credit Impairments Unrecognized Change in Defined Benefit Plan Liabilities (1) Accumulated Other Comprehensive Income (Loss) Balance December 31, 2017 $ 15,453 $ (503) $ (39) $ 14,911 Cumulative-effect adjustment (2) 3,524 (108) — 3,416 OCI, before reclassifications, net of tax (35,494) — (18) (35,512) Amounts reclassified from AOCI, net of tax (216) 490 — 274 Net OCI, current period (35,710) 490 (18) (35,238) Balance December 31, 2018 $ (16,733) $ (121) $ (57) $ (16,911) (1) Represents the reestimation of the defined benefit plan liability assumed in the Eastern acquisition. The defined benefit plan is frozen as to the earnings of additional benefits and the benefit plan liability is reestimated annually. (2) Due to the adoption of ASU 2018-02, ProAssurance recorded a cumulative-effect adjustment as of January 1, 2018 which increased beginning AOCI and decreased retained earnings in order to reclassify stranded tax effects that resulted from the change in enacted federal corporate tax rate from 35% to 21% as a result of the TCJA. |
Share-Based Payments
Share-Based Payments | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Payments | Share-Based Payments Share-based compensation costs are primarily classified as a component of operating expense. During 2020, 2019 and 2018, ProAssurance provided share-based compensation to employees utilizing two types of awards: restricted share units and performance share units. During 2019 and 2018, ProAssurance also provided share-based compensation to employees utilizing purchase match units. The restricted share and performance share awards were made under either the ProAssurance Corporation Amended and Restated 2014 Equity Incentive Plan or the ProAssurance Corporation 2008 Equity Incentive Plan. The Compensation Committee of the Board is responsible for the administration of both plans. The following table provides a summary of compensation expense and the total related tax benefit recognized during each period as well as estimated compensation cost that will be charged to expense in future periods. Share-Based Unrecognized Compensation Cost Year Ended December 31 December 31, 2020 ($ in millions, except remaining recognition period) 2020 2019 2018 Amount Weighted Average Remaining Total share-based compensation expense $ 3.8 $ 3.5 $ 5.3 $ 4.7 2.1 Tax benefit recognized $ 0.8 $ 0.7 $ 1.1 The majority of awards are equity classified awards and are charged to expense as an increase to additional paid-in capital over the service period (generally the vesting period) associated with the award. However, a nominal amount of awards are liability classified awards and are recorded as a liability as they are structured to be settled in cash. As of December 31, 2020, share-based compensation expense related entirely to restricted share units. Restricted share and performance share units vest in their entirety generally at the end of a three-year period, except for certain restricted share units granted in 2019 which will vest at the end of a five-year period, following the grant date based on a continuous service requirement and, for performance share units, achievement of a performance objective. Partial vesting is permitted for retirees. All non-vested purchase match units at December 31, 2018 were fully vested in the fourth quarter of 2019; previously, units vested over a three-year period based on a service requirement with partial vesting permitted for all participants. For the restricted share and purchase match units, a single share of ProAssurance common stock is issued per vested unit. For performance share units, the number of shares of ProAssurance common stock issued per vested unit varies based on performance goals achieved. For equity classified awards, units sufficient to satisfy required tax withholdings are paid in cash rather than in shares of ProAssurance common stock. Liability classified awards, which are nominal in amount, are settled in cash at the end of the vesting period. Restricted Share Units Activity for restricted share units during 2020, 2019 and 2018 is summarized below. Grant date fair values are based on the market value of a share of ProAssurance common stock on the date of grant less the estimated net present value of expected dividends during the vesting period. 2020 2019 2018 Units Weighted Units Weighted Units Weighted Beginning non-vested balance 320,625 $ 43.99 267,323 $ 49.16 269,520 $ 48.63 Granted 111,758 $ 29.18 164,196 $ 36.96 85,797 $ 44.73 Forfeited (9,054) $ 40.13 (3,832) $ 45.09 (3,878) $ 50.07 Vested and released (83,525) $ 56.74 (107,062) $ 46.06 (84,116) $ 42.90 Ending non-vested balance 339,804 $ 36.09 320,625 $ 43.99 267,323 $ 49.16 The aggregate grant date fair value of restricted share units vested and released in 2020, 2019 and 2018 totaled $4.7 million, $4.9 million and $3.6 million, respectively. The aggregate intrinsic value of restricted share units vested and released in 2020, 2019 and 2018 (including units paid in cash to cover tax withholdings) totaled $2.6 million, $4.6 million and $4.1 million, respectively. Performance Share Units Performance share units vest only if minimum performance objectives are met, and the number of units earned varies from 50% to 200% of a base award depending upon the degree to which stated performance objectives are achieved. Performance share unit activity for 2020, 2019 and 2018 is summarized below. The table reflects the base number of units; actual awards that vest depend upon the extent to which performance objectives are achieved. Grant date fair values are based on the market value of a share of ProAssurance common stock on the date of grant less the estimated net present value of expected dividends during the vesting period. 2020 2019 2018 Base Units Weighted Base Units Weighted Base Units Weighted Beginning non-vested balance 100,370 $ 50.10 135,202 $ 49.95 212,105 $ 47.11 Granted 38,609 $ 29.18 25,168 $ 40.18 27,202 $ 44.73 Forfeited — $ — — $ — — $ — Expired* (48,000) $ 58.35 — $ — — $ — Vested and released — $ — (60,000) $ 45.59 (104,105) $ 42.79 Ending non-vested balance 90,979 $ 36.87 100,370 $ 50.10 135,202 $ 49.95 *Represents performance share units that did not vest as minimum performance objectives were not achieved. The aggregate grant date fair value of performance share units (base level) vested and released in 2019 and 2018 totaled $2.7 million and $4.5 million, respectively; there were no performance share units vested and released in 2020 as minimum performance objectives were not achieved. The aggregate intrinsic value of performance share units (base level) vested and released in 2019 and 2018 (including units paid in cash to cover tax withholdings) totaled $2.6 million and $5.0 million, respectively. The weighted average level at which the vested units were issued was 95% and 125% during 2019 and 2018, respectively, based on performance levels achieved. Purchase Match Units The ProAssurance Corporation 2011 Employee Stock Ownership Plan provided a purchase match unit for each share of ProAssurance common stock purchased with contributions by eligible plan participants, with participant contributions subject to a $5,000 annual limit per participant. During 2017, the ProAssurance Corporation 2011 Employee Stock Ownership Plan was discontinued and the existing non-vested purchase match units were fully vested in the fourth quarter of 2019. Purchase match unit activity during 2019 and 2018 is summarized below. Grant date fair values are based on the market value of a ProAssurance common share on the date of grant less the estimated net present value of expected dividends during the vesting period. 2020 2019 2018 Units Weighted Units Weighted Units Weighted Beginning non-vested balance — $ — 44,682 $ 51.05 70,292 $ 49.40 Granted — $ — — $ — — $ — Forfeited — $ — (1,400) $ 51.47 (1,594) $ 50.19 Vested and released — $ — (43,282) $ 51.03 (24,016) $ 46.28 Ending non-vested balance — $ — — $ — 44,682 $ 51.05 |
Variable Interest Entities
Variable Interest Entities | 12 Months Ended |
Dec. 31, 2020 | |
Variable Interest Entities [Abstract] | |
Variable Interest Entities | Variable Interest Entities ProAssurance holds passive interests in a number of entities that are considered to be VIEs under GAAP guidance. ProAssurance's VIE interests principally consist of interests in LPs/LLCs formed for the purpose of achieving diversified equity and debt returns. ProAssurance's VIE interests, carried as a part of investment in unconsolidated subsidiaries, totaled $282.2 million at December 31, 2020 and $309.0 million at December 31, 2019. ProAssurance does not have power over the activities that most significantly impact the economic performance of these VIEs and thus is not the primary beneficiary. Investments in entities where ProAssurance holds a greater than minor interest but does not hold a controlling interest are accounted for using the equity method. Therefore, ProAssurance has not consolidated these VIEs. ProAssurance’s involvement with each VIE is limited to its direct ownership interest in the VIE. Except for the funding commitments disclosed in Note 9, ProAssurance has no arrangements with any of the VIEs to provide other financial support to or on behalf of the VIE. At December 31, 2020, ProAssurance’s maximum loss exposure relative to these investments was limited to the carrying value of ProAssurance’s investment in the VIE. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Diluted weighted average shares is calculated as basic weighted average shares plus the effect, calculated using the treasury stock method, of assuming that restricted share units, performance share units and purchase match units have vested. The following table provides a reconciliation between the Company's basic weighted average number of common shares outstanding to its diluted weighted average number of common shares outstanding: (In thousands, except per share data) Year Ended December 31 2020 2019 2018 Weighted average number of common shares outstanding, basic 53,863 53,740 53,598 Dilutive effect of securities: Restricted Share Units 42 75 70 Performance Share Units 1 10 63 Purchase Match Units — 16 18 Weighted average number of common shares outstanding, diluted 53,906 53,841 53,749 Effect of dilutive shares on earnings (loss) per share $ — $ — $ — The diluted weighted average number of common shares outstanding for the years ended December 31, 2020 and 2018 excludes approximately 114,000 and 2,000, respectively, common share equivalents issuable under the Company's stock compensation plans, as their effect would be antidilutive. There were no antidilutive common share equivalents for the year ended December 31, 2019. Dilutive common share equivalents are reflected in the earnings (loss) per share calculation while antidilutive common share equivalents are not reflected in the earnings (loss) per share calculation. For the year ended December 31, 2020, all incremental common share equivalents were not included in the computation of diluted earnings (loss) per share because to do so would have been antidilutive. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information ProAssurance's segments are based on the Company's internal management reporting structure for which financial results are regularly evaluated by the Company's CODM to determine resource allocation and assess operating performance. The Company continually assesses its internal management reporting structure and information evaluated by its CODM to determine whether any changes have occurred that would impact its segment reporting structure. The Company operates in five segments that are organized around the nature of the products and services provided: Specialty P&C, Workers' Compensation Insurance, Segregated Portfolio Cell Reinsurance, Lloyd's Syndicates and Corporate. A description of each of ProAssurance's five operating and reportable segments follows. Specialty P&C includes professional liability insurance and medical technology liability insurance. Professional liability insurance is primarily comprised of medical professional liability products offered to healthcare providers and institutions. The Company also offers, to a lesser extent, professional liability insurance to attorneys and their firms. Medical technology liability insurance is offered to medical technology and life sciences companies that manufacture or distribute products including entities conducting human clinical trials. In addition, the Company also offers custom alternative risk solutions including loss portfolio transfers, assumed reinsurance and captive cell programs for healthcare professional liability insureds. For the alternative market captive cell programs, the Specialty P&C segment cedes either all or a portion of the premium to certain SPCs in the Company's Segregated Portfolio Cell Reinsurance segment. Workers' Compensation Insurance includes workers' compensation insurance products which are provided primarily to employers with 1,000 or fewer employees. The segment's products include guaranteed cost policies, policyholder dividend policies, retrospectively-rated policies, deductible polices and alternative market solutions. Alternative market program premiums include program design, fronting, claims administration, risk management, SPC rental, asset management and SPC management services. Alternative market program premiums are 100% ceded to either SPCs in the Company's Segregated Portfolio Cell Reinsurance segment or, to a limited extent, to a captive insurer unaffiliated with ProAssurance. Segregated Portfolio Cell Reinsurance includes the results (underwriting profit or loss, plus investment results, net of U.S. federal income taxes) of SPCs at Inova Re and Eastern Re, the Company's Cayman Islands SPC operations. Each SPC is owned, fully or in part, by an agency, group or association, and the results of the SPCs are attributable to the participants of that cell. ProAssurance participates to a varying degree in the results of selected SPCs. SPC results attributable to external cell participants are reflected as SPC dividend expense (income) in the Segregated Portfolio Cell Reinsurance segment and in ProAssurance's Consolidated Statements of Income and Comprehensive Income. In addition, the Segregated Portfolio Cell Reinsurance segment includes the investment results of the SPCs as the investments are solely for the benefit of the cell participants, and investment results attributable to external cell participants are reflected in the SPC dividend expense (income). The SPCs assume workers' compensation insurance, healthcare professional liability insurance or a combination of the two from the Company's Workers' Compensation Insurance and Specialty P&C segments. Lloyd's Syndicates includes results from ProAssurance's participation in Lloyd's of London Syndicate 1729 and Syndicate 6131. The results of this segment are normally reported on a quarter lag, except when information is available that is material to the current period. Furthermore, investment results associated with the majority of investment assets solely allocated to Lloyd's Syndicate operations and certain U.S. paid administrative expenses are reported concurrently as that information is available on an earlier time frame. Syndicate 1729 underwrites risks over a wide range of property and casualty insurance and reinsurance lines in both the U.S. and international markets while Syndicate 6131 focuses on contingency and specialty property business, also within the U.S. and international markets. For the 2020 underwriting year, ProAssurance decreased its participation in the results of Syndicate 1729 to 29% from 61%; however, due to the quarter lag these changes were not reflected in the Company's results until the second quarter of 2020. Syndicate 6131 is an SPA that underwrites on a quota share basis with Syndicate 1729. Effective July 1, 2020, Syndicate 6131 entered into a six-month quota share reinsurance agreement with an unaffiliated insurer. Under this agreement, Syndicate 6131 ceded essentially half of the premium assumed from Syndicate 1729 to the unaffiliated insurer; the agreement was non-renewed on January 1, 2021. Due to the quarter lag, the effect of this reinsurance arrangement was not reflected in our results until the fourth quarter of 2020. Corporate includes ProAssurance's investment operations, other than those reported in the Company's Segregated Portfolio Cell Reinsurance and Lloyd's Syndicates segments, interest expense and U.S. income taxes. The segment also includes non-premium revenues generated outside of the Company's insurance entities and corporate expenses. The accounting policies of the segments are described in Note 1. ProAssurance evaluates the performance of its Specialty P&C and Workers' Compensation Insurance segments based on before tax underwriting profit or loss. ProAssurance evaluates the performance of its Segregated Portfolio Cell Reinsurance segment based on operating profit or loss, which includes investment results of investment assets solely allocated to SPC operations, net of U.S. federal income taxes. Performance of the Lloyd's Syndicates segment is evaluated based on operating profit or loss, which includes investment results of investment assets solely allocated to Lloyd's Syndicate operations, net of U.K. income tax expense. Performance of the Corporate segment is evaluated based on the contribution made to consolidated after-tax results. ProAssurance accounts for inter-segment transactions as if the transactions were to third parties at current market prices. Assets are not allocated to segments because investments, other than the investments discussed above that are solely allocated to the Segregated Portfolio Cell Reinsurance and Lloyd's Syndicates segments, and other assets are not managed at the segment level. The tabular information that follows shows the financial results of the Company's reportable segments reconciled to results reflected in the Consolidated Statements of Income and Comprehensive Income. ProAssurance does not consider asset impairments, including goodwill and intangible asset impairments, in assessing the financial performance of its operating and reportable segments, and thus are included in the reconciliation of segment results to consolidated results. Financial results by segment were as follows: Year Ended December 31, 2020 (In thousands) Specialty P&C Workers' Compensation Insurance Segregated Portfolio Cell Reinsurance Lloyd's Syndicates Corporate Inter-segment Eliminations Consolidated Net premiums earned $ 477,365 $ 171,772 $ 66,352 $ 77,226 $ — $ — $ 792,715 Net investment income — — 1,084 4,128 66,786 — 71,998 Equity in earnings (loss) of unconsolidated subsidiaries — — — — (11,921) — (11,921) Net realized gains (losses) — — 3,085 988 11,605 — 15,678 Other income (expense) (1) 3,908 2,216 205 51 2,531 (2,441) 6,470 Net losses and loss adjustment expenses (470,074) (111,552) (29,605) (50,216) — — (661,447) Underwriting, policy acquisition and operating expenses (1) (109,599) (56,449) (20,709) (30,136) (23,429) 2,441 (237,881) SPC U.S. federal income tax expense (2) — — (1,746) — — — (1,746) SPC dividend (expense) income — — (14,304) — — — (14,304) Interest expense — — — — (15,503) — (15,503) Income tax benefit (expense) — — — 29 41,300 — 41,329 Segment results $ (98,400) $ 5,987 $ 4,362 $ 2,070 $ 71,369 $ — $ (14,612) Reconciliation of segments to consolidated results: Goodwill impairment (161,115) Net income (loss) $ (175,727) Significant non-cash items: Goodwill impairment $ — $ — $ — $ — $ — $ — $ 161,115 Depreciation and amortization, net of accretion $ 7,747 $ 3,690 $ 676 $ (4) $ 9,266 $ — $ 21,375 Year Ended December 31, 2019 (In thousands) Specialty P&C Workers' Compensation Insurance Segregated Portfolio Cell Reinsurance Lloyd's Syndicates Corporate Inter-segment Eliminations Consolidated Net premiums earned $ 499,058 $ 189,240 $ 78,563 $ 80,671 $ — $ — $ 847,532 Net investment income — — 1,578 4,551 87,140 — 93,269 Equity in earnings (loss) of unconsolidated subsidiaries — — — — (10,061) — (10,061) Net realized gains (losses) — — 4,020 768 55,086 — 59,874 Other income (expense) (1) 5,796 2,399 559 (573) 3,478 (2,439) 9,220 Net losses and loss adjustment expenses (532,485) (121,649) (52,412) (47,369) — — (753,915) Underwriting, policy acquisition and operating expenses (1)(3) (120,310) (57,520) (23,201) (34,711) (19,146) 2,439 (252,449) SPC U.S. federal income tax expense (2)(3) — — (1,059) — — — (1,059) SPC dividend (expense) income — — (4,579) — — — (4,579) Interest expense — — — — (16,636) — (16,636) Income tax benefit (expense) — — — — 29,808 — 29,808 Segment results $ (147,941) $ 12,470 $ 3,469 $ 3,337 $ 129,669 $ — $ 1,004 Net income (loss) $ 1,004 Significant non-cash items: Depreciation and amortization, net of accretion $ 6,586 $ 3,825 $ (41) $ (7) $ 8,302 $ — $ 18,665 Year Ended December 31, 2018 (In thousands) Specialty P&C Workers' Compensation Insurance Segregated Portfolio Cell Reinsurance Lloyd's Syndicates Corporate Inter-segment Eliminations Consolidated Net premiums earned $ 491,787 $ 186,079 $ 73,940 $ 67,047 $ — $ — $ 818,853 Net investment income — — 1,566 3,358 86,960 — 91,884 Equity in earnings (loss) of unconsolidated subsidiaries — — — — 8,948 — 8,948 Net realized gains (losses) — — (3,149) (460) (39,879) — (43,488) Other income (expense) (1) 5,844 2,412 211 322 3,525 (2,481) 9,833 Net losses and loss adjustment expenses (384,431) (118,483) (38,726) (51,570) — — (593,210) Underwriting, policy acquisition and operating expenses (1)(3) (112,419) (55,693) (22,060) (31,686) (18,767) 2,435 (238,190) SPC U.S. federal income tax expense (2)(3) — — (366) — — — (366) SPC dividend (expense) income — — (9,122) — — — (9,122) Interest expense — — — — (16,163) 46 (16,117) Income tax benefit (expense) — — — 317 17,715 — 18,032 Segment results $ 781 $ 14,315 $ 2,294 $ (12,672) $ 42,339 $ — $ 47,057 Net income (loss) $ 47,057 Significant non-cash items: Depreciation and amortization, net of accretion $ 7,050 $ 3,850 $ 441 $ (8) $ 9,922 $ — $ 21,255 (1) Certain fees for services provided to the SPCs at Inova Re and Eastern Re are recorded as expenses within the Segregated Portfolio Cell Reinsurance segment and as other income within the Workers' Compensation Insurance segment. These fees are primarily SPC rental fees and are eliminated between segments in consolidation. (2) Represents the provision for U.S. federal income taxes for SPCs at Inova Re, which have elected to be taxed as a U.S. corporation under Section 953(d) of the Internal Revenue Code. U.S. federal income taxes are included in the total SPC net results and are paid by the individual SPCs. (3) In ProAssurance's December 31, 2019 and 2018 reports on Form 10-K, underwriting, policy acquisition and operating expenses for the years ended December 31, 2019 and 2018 included a provision for U.S. federal income taxes of $1.1 million and $0.4 million, respectively, for SPCs at Inova Re that have elected to be taxed as U.S. taxpayers (see footnote 2). Beginning in 2020, this tax provision is now presented as a separate line item on the Consolidated Statements of Income and Comprehensive Income as SPC U.S. federal income tax expense. To conform to the current year presentation, ProAssurance has recast underwriting, policy acquisition and operating expenses for the years ended December 31, 2019 and 2018. The following table provides detailed information regarding ProAssurance's gross premiums earned by product as well as a reconciliation to net premiums earned. All gross premiums earned are from external customers except as noted. ProAssurance's insured risks are primarily within the U.S. Year Ended December 31 (In thousands) 2020 2019 2018 Specialty P&C Segment Gross premiums earned: HCPL $ 411,716 $ 434,867 $ 433,193 Small business unit 104,376 109,876 111,204 Medical technology liability 34,909 33,957 35,157 Other 821 2,096 468 Ceded premiums earned (74,457) (81,738) (88,235) Segment net premiums earned 477,365 499,058 491,787 Workers' Compensation Insurance Segment Gross premiums earned: Traditional business 184,204 203,195 199,466 Alternative market business 71,280 84,214 83,508 Ceded premiums earned (83,712) (98,169) (96,895) Segment net premiums earned 171,772 189,240 186,079 Segregated Portfolio Cell Reinsurance Segment Gross premiums earned: Workers' compensation (1) 68,518 81,765 78,255 HCPL (2) 6,594 6,059 5,009 Other — 480 — Ceded premiums earned (8,760) (9,741) (9,324) Segment net premiums earned 66,352 78,563 73,940 Lloyd's Syndicates Segment Gross premiums earned: Property and casualty (3) 98,990 101,222 83,307 Ceded premiums earned (21,764) (20,551) (16,260) Segment net premiums earned 77,226 80,671 67,047 Consolidated net premiums earned $ 792,715 $ 847,532 $ 818,853 (1) Premium for all periods is assumed from the Workers' Compensation Insurance segment. (2) Premium for all periods is assumed from the Specialty P&C segment. (3) Includes a nominal amount of premium assumed from the Specialty P&C segment for the year ended December 31, 2019 and $5.0 million for year ended December 31, 2018. |
Benefit Plans
Benefit Plans | 12 Months Ended |
Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |
Benefit Plans | Benefit Plans ProAssurance maintains the ProAssurance Savings Plan that provides a vehicle for eligible employees to build retirement income. For the first half of 2020 and for the years ended December 31, 2019 and 2018, ProAssurance provided employer contributions to the plan of up to 10% of eligible contributions for qualified employees. Given the Company’s current earnings profile and the effects that underlying conditions in the broader insurance marketplace continue to have on the Company’s results, the maximum employer contribution to the plan was reduced to 5% from 10% of eligible contributions for qualified employees effective July 2020. ProAssurance incurred expense related to the ProAssurance Savings Plan of $5.5 million, $7.2 million and $7.0 million during the years ended December 31, 2020, 2019 and 2018, respectively. ProAssurance also maintains the ProAssurance Plan that allows eligible management employees to defer a portion of their current salary. ProAssurance incurred nominal expense related to the ProAssurance Plan in each of the years ended December 31, 2020, 2019 and 2018. ProAssurance deferred compensation liabilities totaled $30.3 million and $26.8 million at December 31, 2020 and 2019, respectively. The liabilities included amounts due under the ProAssurance Plan and amounts due under individual agreements with current or former employees. |
Statutory Accounting and Divide
Statutory Accounting and Dividend Restrictions | 12 Months Ended |
Dec. 31, 2020 | |
Insurance [Abstract] | |
Statutory Accounting and Dividend Restrictions | Statutory Accounting and Dividend Restrictions ProAssurance’s domestic U.S. insurance subsidiaries are required to file statutory financial statements with state insurance regulatory authorities, prepared based upon SAP prescribed or permitted by regulatory authorities. ProAssurance did not use any prescribed or permitted SAP that differed from the NAIC's SAP at December 31, 2020, 2019 or 2018. The most significant differences between net income (loss) prepared in accordance with GAAP and statutory net income (loss) are generally due to: (a) policy acquisition and certain software and equipment costs which are deferred under GAAP but expensed for statutory purposes, (b) certain deferred income taxes which are recognized under GAAP but are not recognized for statutory purposes, (c) net unrealized gains or losses which are included in shareholders' equity related to available-for-sale fixed maturity securities carried at fair value under GAAP but are principally carried at amortized cost for statutory purposes and (d) accounting for goodwill and intangible assets. The NAIC specifies risk-based capital requirements for property and casualty insurance providers. At December 31, 2020, actual statutory capital and surplus for each of ProAssurance’s insurance subsidiaries exceeded the minimum regulatory requirements. Net income (loss) and capital and surplus of ProAssurance’s insurance subsidiaries on a statutory basis are shown in the following table. (In millions) Statutory Net Income (Loss) Statutory Capital and Surplus 2020 2019 2018 2020 2019 $81 ($22) $135 $831 $878 At December 31, 2020, $1.1 billion of ProAssurance's consolidated net assets were held at its domestic insurance subsidiaries, of which approximately $87 million are permitted to be paid as dividends over the course of 2021 without prior approval of state insurance regulators. However, the payment of any dividend requires prior notice to the insurance regulator in the state of domicile and the regulator may prevent the dividend if, in its judgment, payment of the dividend would have an adverse effect on the capital and surplus of the insurance subsidiary. In addition, ProAssurance makes the decision to pay dividends from an insurance subsidiary based on the capital needs of that subsidiary and may pay less than the permitted dividend or may also request permission to pay an additional amount (an extraordinary dividend). |
Schedule I - Summary of Investm
Schedule I - Summary of Investments - Other Than Investments In Related Parties | 12 Months Ended |
Dec. 31, 2020 | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Abstract] | |
Schedule I - Summary of Investments Other than Investments in Related Parties | December 31, 2020 Type of Investment Recorded Fair Amount Which is Fixed maturities Bonds: U.S. Government or government agencies and authorities $ 134,567 $ 137,964 $ 137,964 States, municipalities and political subdivisions 316,022 332,920 332,920 Foreign governments 30,591 32,450 32,450 Public utilities 63,550 67,251 67,251 All other corporate bonds 1,202,963 1,259,016 1,259,016 Asset-backed securities 661,789 676,386 676,386 Total Fixed Maturities 2,409,482 2,505,987 2,505,987 Equity Securities Common Stocks: Public utilities 290 346 346 Banks, trusts and insurance companies 14,904 13,810 13,810 Industrial, miscellaneous and all other 98,515 105,945 105,945 Total Equity Securities, trading 113,709 120,101 120,101 Other long-term investments 328,843 425,444 425,444 Short-term investments 337,672 337,813 337,813 Total Investments $ 3,189,706 $ 3,389,345 $ 3,389,345 |
Schedule II - Condensed Financi
Schedule II - Condensed Financial Information of Registrant | 12 Months Ended |
Dec. 31, 2020 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule II - Condensed Financial Information of Registrant | December 31, December 31, Assets Investment in subsidiaries, at equity $ 1,383,527 $ 1,534,367 Fixed maturities available for sale, at fair value 33,824 85,263 Short-term investments 115,198 63,992 Investment in unconsolidated subsidiaries 915 915 Cash and cash equivalents 55,469 65,956 Other assets 28,778 40,640 Total Assets $ 1,617,711 $ 1,791,133 Liabilities and Shareholders’ Equity Liabilities: Due to subsidiaries $ 10,696 $ 9,899 Dividends payable 2,694 16,676 Other liabilities 6,361 4,268 Debt less debt issuance costs 248,750 248,377 Total Liabilities 268,501 279,220 Shareholders’ Equity: Common stock 632 631 Other shareholders’ equity, including unrealized gains (losses) on securities of subsidiaries 1,348,578 1,511,282 Total Shareholders’ Equity 1,349,210 1,511,913 Total Liabilities and Shareholders’ Equity $ 1,617,711 $ 1,791,133 Year Ended December 31 2020 2019 2018 Revenues Net investment income $ 331 $ 2,694 $ 3,495 Equity in earnings (loss) of unconsolidated subsidiaries — 40 (325) Net realized investment gains (losses) 2,194 19 (789) Other income (loss) 12 795 977 Total revenues 2,537 3,548 3,358 Expenses Interest expense 14,260 14,074 14,844 Other expenses 21,458 16,653 17,092 Total expenses 35,718 30,727 31,936 Income (loss) before income tax expense (benefit) and equity in net income (loss) of consolidated subsidiaries (33,181) (27,179) (28,578) Income tax expense (benefit) 11,404 (28,455) (7,142) Income (loss) before equity in net income (loss) of consolidated subsidiaries (44,585) 1,276 (21,436) Equity in net income (loss) of consolidated subsidiaries (131,142) (272) 68,493 Net income (loss) (175,727) 1,004 47,057 Other comprehensive income (loss) 38,272 53,866 (35,238) Comprehensive income $ (137,455) $ 54,870 $ 11,819 Year Ended December 31 2020 2019 2018 Net cash provided (used) by operating activities $ (21,450) $ 20,055 $ 27,981 Investing activities Proceeds from sales or maturities of: Fixed maturities, available for sale 87,101 27,974 169,822 Net decrease (increase) in short-term investments (51,206) 12,603 194,035 Dividends from subsidiaries 79,486 52,499 29,395 Contribution of capital to subsidiaries (97,541) — — Funds (advanced) repaid for Lloyd's FAL deposit 32,256 (4,894) (21,576) Funds (advanced) repaid under Syndicate Credit Agreement — 30,296 (11,232) Other (2,206) (936) 330 Net cash provided (used) by investing activities 47,890 117,542 360,774 Financing activities Borrowings (repayments) under Revolving Credit Agreement — — (123,000) Subsidiary payments for common shares and share-based compensation awarded to subsidiary employees 2,846 344 1,154 Dividends to shareholders (38,664) (93,204) (316,476) Other (1,109) (4,538) (5,685) Net cash provided (used) by financing activities (36,927) (97,398) (444,007) Increase (decrease) in cash and cash equivalents (10,487) 40,199 (55,252) Cash and cash equivalents at beginning of period 65,956 25,757 81,009 Cash and cash equivalents at end of period $ 55,469 $ 65,956 $ 25,757 Supplemental disclosure of cash flow information: Cash paid during the year for income taxes, net of refunds $ (9,117) $ 2,053 $ 4,966 Cash paid during the year for interest $ 13,888 $ 13,699 $ 14,777 Significant non-cash transactions: Dividends declared and not yet paid $ 2,694 $ 16,676 $ 43,446 Securities transferred at fair value as dividends from subsidiaries $ 34,915 $ 34,897 $ 98,292 Basis of Presentation The registrant-only financial statements should be read in conjunction with ProAssurance Corporation’s Consolidated Financial Statements and Notes thereto. At December 31, 2020 and 2019, PRA investment in subsidiaries is stated at the initial consolidation value plus equity in the undistributed earnings of subsidiaries since the date of acquisition. ProAssurance Corporation has a management agreement with several of its insurance subsidiaries whereby ProAssurance Corporation charges the subsidiaries a management fee for various management services provided to the subsidiary. Under the arrangement, the expenses associated with such services remain as expenses of ProAssurance Corporation and the management fee charged is reported as an offset to ProAssurance Corporation expenses. |
Schedule III - Supplementary In
Schedule III - Supplementary Insurance Information | 12 Months Ended |
Dec. 31, 2020 | |
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Abstract] | |
Schedule III - Supplementary Insurance Information | 2020 2019 2018 Net premiums earned Specialty P&C $ 477,365 $ 499,058 $ 491,787 Workers' Compensation Insurance 171,772 189,240 186,079 Segregated Portfolio Cell Reinsurance 66,352 78,563 73,940 Lloyd's Syndicates 77,226 80,671 67,047 Consolidated $ 792,715 $ 847,532 $ 818,853 Net investment income (1) Segregated Portfolio Cell Reinsurance $ 1,084 $ 1,578 $ 1,566 Lloyd's Syndicates 4,128 4,551 3,358 Corporate 66,786 87,140 86,960 Consolidated $ 71,998 $ 93,269 $ 91,884 Losses and loss adjustment expenses incurred related to current year, net of reinsurance Specialty P&C $ 497,554 $ 526,744 $ 461,516 Workers' Compensation Insurance 118,523 129,450 126,534 Segregated Portfolio Cell Reinsurance 46,200 62,546 47,693 Lloyd's Syndicates 49,569 46,958 49,583 Consolidated $ 711,846 $ 765,698 $ 685,326 Losses and loss adjustment expenses incurred related to prior year, net of reinsurance Specialty P&C $ (27,480) $ 5,741 $ (77,085) Workers' Compensation Insurance (6,971) (7,801) (8,051) Segregated Portfolio Cell Reinsurance (16,595) (10,134) (8,967) Lloyd's Syndicates 647 411 1,987 Consolidated $ (50,399) $ (11,783) $ (92,116) Paid losses and loss adjustment expenses, net of reinsurance Specialty P&C $ 379,656 $ 382,845 $ 354,221 Workers' Compensation Insurance 118,496 117,848 108,742 Segregated Portfolio Cell Reinsurance 46,267 37,034 29,320 Lloyd's Syndicates 40,897 36,593 37,496 Inter-segment eliminations (143) (196) 200 Consolidated $ 585,173 $ 574,124 $ 529,979 Amortization of DPAC Specialty P&C $ 53,562 $ 56,605 $ 52,253 Workers' Compensation Insurance 15,895 17,144 16,864 Segregated Portfolio Cell Reinsurance 19,636 21,717 21,039 Lloyd's Syndicate 21,597 21,392 15,913 Inter-segment eliminations (125) (1,528) (1,568) Consolidated $ 110,565 $ 115,330 $ 104,501 Other underwriting, policy acquisition and operating expenses Specialty P&C $ 56,037 $ 63,705 $ 60,166 Workers' Compensation Insurance 40,554 40,376 38,829 Segregated Portfolio Cell Reinsurance (2) 1,073 1,484 1,021 Lloyd's Syndicates 8,539 13,319 15,773 Corporate 23,429 19,146 18,767 Inter-segment eliminations (2,316) (911) (867) Consolidated $ 127,316 $ 137,119 $ 133,689 Continued on the following page. 2020 2019 2018 Continued from previous page Net premiums written Specialty P&C $ 451,019 $ 495,750 $ 494,148 Workers' Compensation Insurance 164,871 182,233 195,350 Segregated Portfolio Cell Reinsurance 64,159 77,639 75,547 Lloyd's Syndicates 67,652 87,103 69,869 Consolidated $ 747,701 $ 842,725 $ 834,914 Deferred policy acquisition costs (1) $ 47,196 $ 55,567 $ 54,116 Reserve for losses and loss adjustment expenses (1) $ 2,417,179 $ 2,346,526 $ 2,119,847 Unearned premiums (1) $ 361,547 $ 413,086 $ 415,211 (1) Assets are not allocated to segments because investments, other than the investments that are solely allocated to the Segregated Portfolio Cell Reinsurance and Lloyd's Syndicates segments, and other assets are not managed at the segment level. See Note 16 of the Notes to Consolidated Financial Statements for additional information. (2) In ProAssurance's December 31, 2019 and 2018 reports on Form 10-K, underwriting, policy acquisition and operating expenses for the years ended December 31, 2019 and 2018 included a provision for U.S. federal income taxes of $1.1 million and $0.4 million, respectively, for SPCs at Inova Re that have elected to be taxed as U.S. taxpayers. Beginning in 2020, this tax provision is now presented as a separate line item on the Consolidated Statements of Income and Comprehensive Income as SPC U.S. federal income tax expense. To conform to the current year presentation, ProAssurance has recast underwriting, policy acquisition and operating expenses for the years ended December 31, 2019 and 2018. |
Schedule IV - Reinsurance
Schedule IV - Reinsurance | 12 Months Ended |
Dec. 31, 2020 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | |
Schedule IV - Reinsurance | 2020 2019 2018 Property and Liability * Premiums earned $ 862,742 $ 926,035 $ 903,354 Premiums ceded (113,582) (124,171) (126,036) Premiums assumed 43,555 45,668 41,535 Net premiums earned $ 792,715 $ 847,532 $ 818,853 Percentage of amount assumed to net 5.49% 5.39% 5.07% * All of ProAssurance’s premiums are related to property and liability coverages. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Organization and Nature of Business | Organization and Nature of Business ProAssurance Corporation (ProAssurance, PRA or the Company), a Delaware corporation, is an insurance holding company primarily for wholly owned specialty property and casualty and workers' compensation insurance entities including an entity that provides capital to Syndicate 1729 and Syndicate 6131 at Lloyd's. Risks insured are primarily liability risks located within the U.S. ProAssurance operates in five reportable segments as follows: Specialty P&C, Workers' Compensation Insurance, Segregated Portfolio Cell Reinsurance, Lloyd's Syndicates and Corporate. For more information on the Company's segment reporting, including the nature of products and services provided and financial information by segment, refer to Note 16. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of ProAssurance Corporation and its wholly owned subsidiaries. Investments in entities where ProAssurance holds a greater than minor interest but does not hold a controlling interest are accounted for using the equity method. All significant intercompany accounts and transactions are eliminated in consolidation. ProAssurance subsidiaries located in the U.K. are normally reported on a quarter lag due to timing issues regarding the availability of information, except when information is available that is material to the current period. Furthermore, investment results associated with ProAssurance's FAL investments and certain U.S. paid administrative expenses are reported concurrently as that information is available on an earlier time frame. |
Basis of Presentation | Basis of Presentation 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, revenues and expenses, and disclosures related to these amounts at the date of the financial statements. |
Recognition of Revenues, Credit Losses, Earned But Unbilled Premiums and Lloyd's Premium Estimates | Recognition of Revenues Insurance premiums are recognized as revenues pro rata over the terms of the policies, which are principally one year in duration. Credit Losses ProAssurance's premiums receivable and reinsurance receivables are exposed to credit losses but to-date have not experienced any significant amount of credit losses. ProAssurance measures expected credit losses on its premiums receivables and reinsurance receivables on a collective (pool) basis when similar risk characteristics exist, and the Company will reassess its pools each reporting period to ensure all receivables within the pool continue to share similar risk characteristics. If the Company determines that a receivable does not share risk characteristics with its other receivables within a pool, it will evaluate that receivable for expected credit losses on an individual basis. ProAssurance measures expected credit losses associated with its premium receivables at the segment level as each segment’s premium receivables share similar risk characteristics including term, type of financial asset and similar historical and expected credit loss patterns. ProAssurance measures expected credit losses associated with its reinsurance receivables (related to both paid and unpaid losses) at the consolidated level as its reinsurance receivables share similar risk characteristics including type of financial asset, type of industry and similar historical and expected credit loss patterns. ProAssurance measures expected credit losses over the contractual term of each pool utilizing a loss rate method. Historical internal credit loss experience for each pool is the basis for the Company’s assessment of expected credit losses; however, the Company may also consider historical credit loss information from external sources. In addition to historical credit loss data, the Company also considers reasonable and supportable forecasts of future economic conditions in its estimate of expected credit losses by utilizing industry and macroeconomic factors that it believes most relevant to the collectability of each pool. ProAssurance's premiums receivable on its Consolidated Balance Sheet as of December 31, 2020 and 2019 is reported net of the related allowance for expected credit losses of $6.1 million and $1.6 million, respectively. The following tables present a roll forward of the allowance for expected credit losses related to the Company's premiums receivable for the year ended December 31, 2020. (In thousands) Premiums Receivable, Net Allowance for Expected Credit Losses Balance, December 31, 2019 $ 249,540 $ 1,590 Cumulative-effect adjustment on January 1, 2020, before tax - ASU 2016-13 adoption 5,160 Provision for expected credit losses 827 Write offs charged against the allowance (2,019) Recoveries of amounts previously written off 573 Balance, December 31, 2020 $ 201,395 $ 6,131 ProAssurance's expected credit losses associated with its reinsurance receivables (related to both paid and unpaid losses) were nominal in amount as of December 31, 2020. ProAssurance has other financial assets and off-balance-sheet commitments that are exposed to credit losses; however, expected credit losses associated with these assets and commitments were nominal in amount as of December 31, 2020. Earned But Unbilled Premiums Workers’ compensation premiums are determined based upon the payroll of the insured, the applicable premium rates and an experience-based modification factor, where applicable. An audit of the policyholders’ records is conducted after policy expiration to make a final determination of applicable premiums. Audit premium due from or due to a policyholder as a result of an audit is reflected in net premiums written and earned when billed. ProAssurance tracks, by policy, the amount of additional premium billed in final audit invoices as a percentage of payroll exposure and uses this information to estimate the Lloyd’s Premium Estimates For certain insurance policies and reinsurance contracts written in the Lloyd’s Syndicates segment, premiums are initially recognized based upon estimates of ultimate premium. Estimated ultimate premium consists primarily of premium written under delegated underwriting authority arrangements, which consist primarily of binding authorities, and certain assumed reinsurance agreements. These estimates of ultimate premium are judgmental and are dependent upon certain assumptions, including historical premium trends for similar agreements. As reports are received from programs, ultimate premium estimates are revised, if necessary, with changes reflected in current operations. |
Losses and Loss Adjustment Expenses | Losses and Loss Adjustment Expenses ProAssurance establishes its reserve for losses and LAE ("reserve for losses" or "reserve") based on estimates of the future amounts necessary to pay claims and expenses associated with the investigation and settlement of claims. The reserve for losses is determined on the basis of individual claims and payments thereon as well as actuarially determined estimates of future losses based on past loss experience, available industry data and projections as to future claims frequency, severity, inflationary trends, judicial trends, legislative changes and settlement patterns. Management establishes the reserve for losses after taking into consideration a variety of factors including premium rates, historical paid and incurred loss development trends, and management's evaluation of the current loss environment including frequency, severity, the expected effect of inflation, general economic and social trends, and the legal and political environment. Management also takes into consideration the conclusions reached by internal and consulting actuaries. Management updates and reviews the data underlying the estimation of the reserve for losses each reporting period and makes adjustments to loss estimation assumptions that best reflect emerging data. Both internal and consulting actuaries perform an in-depth review of the reserve for losses on at least a semi-annual basis using the loss and exposure data of ProAssurance's subsidiaries. Consulting actuaries provide reports to management regarding the adequacy of reserves. Estimating casualty insurance reserves, and particularly long-tailed insurance reserves, is a complex process. Long-tailed insurance is characterized by the extended period of time typically required both to assess the viability of a claim and potential damages, if any, and to reach a resolution of the claim. For a high proportion of the risks insured or reinsured by ProAssurance, the period of time required to resolve a claim is often five years or more, and claims may be subject to litigation. Estimating losses for these long-tailed claims requires ProAssurance to make and revise judgments and assessments regarding multiple uncertainties over an extended period of time. As a result, reserve estimates may vary significantly from the eventual outcome. Reserve estimates and the assumptions on which these estimates are predicated are regularly reviewed and updated as new information becomes available. Any adjustments necessary are reflected in current operations. Due to the size of ProAssurance’s reserve for losses, even a small percentage adjustment to these estimates could have a material effect on earnings in the period in which the adjustment is made, as was the case in 2020, 2019 and 2018. The effect of adjustments made to reinsured losses is mitigated by the corresponding adjustment that is made to reinsurance recoveries. Thus, in any given year, ProAssurance may make significant adjustments to gross losses that have little effect on its net losses. |
Reinsurance Receivables | Reinsurance Receivables ProAssurance enters into reinsurance agreements whereby other insurance entities agree to assume a portion of the risk associated with certain policies issued by ProAssurance. In return, ProAssurance agrees to pay a premium to the reinsurer. ProAssurance uses reinsurance to provide capacity to write larger limits of liability, to provide reimbursement for losses incurred under the higher limit coverages the Company offers, to provide protection against losses in excess of policy limits, and, in the case of risk sharing arrangements, to align the Company's objectives with those of its strategic business partners and to provide custom insurance solutions for large customer groups. Receivable from reinsurers on paid losses and LAE is the estimated amount of losses already paid that will be recoverable from reinsurers. Receivable from reinsurers on unpaid losses and LAE is the estimated amount of future loss payments that will be recoverable from reinsurers. Reinsurance recoveries are the portion of losses incurred during the period that are estimated to be allocable to reinsurers. Premiums ceded are the estimated premiums that will be due to reinsurers with respect to premiums earned and losses incurred during the period. These estimates are based upon management’s estimates of ultimate losses and the portion of those losses that are allocable to reinsurers under the terms of the related reinsurance agreements. Given the uncertainty of the ultimate amounts of losses, these estimates may vary significantly from the ultimate outcome. Management regularly reviews these estimates and any adjustments necessary are reflected in the period in which the estimate is changed. Due to the size of the receivable from |
Retroactive Insurance Contracts | Retroactive Insurance Contracts In certain instances, ProAssurance’s insurance contracts cover losses both on a prospective basis and retroactive basis, and accordingly, ProAssurance bifurcates the prospective and retroactive provisions of these contracts and accounts for each component separately, where practicable. Under the retroactive provisions of a contract, all premiums received and losses assumed are recognized immediately in earnings at the inception of the contract as all of the underlying loss events occurred in the past. If the estimated losses assumed differ from the premium received related to the retroactive provision of a contract, the resulting difference is deferred and recognized over the estimated claim payment period with the periodic amortization reflected in earnings as a component of net losses and LAE. Deferred gains are included as a component of the reserve for losses and LAE, and deferred losses are included as a component of other assets on the Consolidated Balance Sheet. Subsequent changes to the estimated timing or amount of future loss payments in relation to the losses assumed under retroactive provisions also produce changes in deferred balances. Changes in such estimates are applied retrospectively, and the resulting changes in deferred balances, together with periodic amortization, are included in earnings in the period of change. |
Deferred Policy Acquisition Costs; Ceding Commission Income | Deferred Policy Acquisition Costs; Ceding Commission Income Costs that vary with and are directly related to the successful production of new and renewal premiums (primarily premium taxes, commissions and underwriting salaries) are deferred to the extent they are recoverable against unearned premiums and are amortized as related premiums are earned. Unearned ceding commission income is reported as an offset to DPAC, and ceding commission earned is reported as an offset to DPAC amortization. ProAssurance evaluates the recoverability of DPAC typically at the segment level each reporting period, or in a manner that is consistent with the way the Company manages its business. Any amounts estimated to be unrecoverable are charged to expense in the current period. As part of the evaluation of the recoverability of DPAC, ProAssurance also evaluates unearned premium for premium deficiencies. A premium deficiency is recognized if the sum of anticipated losses and loss adjustment expenses, unamortized DPAC and maintenance costs, net of anticipated investment income, exceeds the related unearned premium. If a premium deficiency is identified, the associated DPAC is written off, and a PDR is recorded for the excess deficiency as a component of net losses and loss adjustment expenses in the Consolidated Statement of Income and Comprehensive Income and as a component of the reserve for losses on the Consolidated Balance Sheet. |
Investments | Investments Recurring Fair Value Measurements Fair values of investment securities are primarily provided by independent pricing services. The pricing services provide an exchange-traded price, if available, or provide an estimated price determined using multiple observable inputs, including exchange-traded prices for similar assets. Management reviews valuations of securities obtained from the pricing services for accuracy based upon the specifics of the security, including class, maturity, credit rating, durations, collateral and comparable markets for similar securities. Multiple observable inputs are not available for certain of the Company's investments, including corporate debt not actively traded, certain asset-backed securities and investments in LPs/LLCs. Management values the corporate debt not actively traded and the other asset-backed securities either using dealer quotes for similar securities or discounted cash flow models using yields currently available for similar securities. Management values certain investment funds, primarily LPs/LLCs, based on the NAV of the interest held, as provided by the fund. Nonrecurring Fair Value Measurements Management measures the fair value of certain assets on a nonrecurring basis when events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. These assets include investments carried principally at cost, investments in tax credit partnerships, fixed assets, goodwill and other intangible assets. These assets would also include any equity method investments that do not provide a NAV. Fixed Maturities Fixed maturities are considered as either available-for-sale or trading securities. Available-for-sale securities are carried at fair value, determined as described above and in Note 2. Exclusive of impairment losses, discussed in a separate section that follows, unrealized holding gains and losses on available-for-sale securities are included, net of related tax effects, as a component of OCI in the Consolidated Statement of Income and Comprehensive Income during the period of change and as a component AOCI in shareholders' equity on the Consolidated Balance Sheet. Investment income includes amortization of premium and accretion of discount related to available-for-sale debt securities acquired at other than par value. Debt securities and mandatorily redeemable preferred stock with maturities beyond one year when purchased are classified as fixed maturities. Trading securities are carried at fair value, determined as described above, with the unrealized holding gains and losses included as a component of net realized investment gains (losses) in the Consolidated Statement of Income and Comprehensive Income during the period of change. Equity Investments Equity investments are carried at fair value, as described above, with the holding gains and losses included as a component of net realized investment gains (losses) in the Consolidated Statement of Income and Comprehensive Income during the period of change. Equity investments are primarily comprised of stocks, bond funds and investment funds. Short-term Investments Short-term investments, which have a maturity at purchase of one year or less, are primarily comprised of investments in U.S. Treasury obligations, commercial paper and money market funds. All balances are carried at fair value which approximates the cost of the securities due to their short-term nature. Other Investments Investments in convertible bond securities are carried at fair value as permitted by the accounting guidance for hybrid financial instruments, with changes in fair value recognized in income as a component of net realized investment gains (losses) during the period of change. Interest on convertible bond securities is recorded on an accrual basis based on contractual interest rates and is included in net investment income. Investment in Unconsolidated Subsidiaries Equity investments, primarily investments in LPs/LLCs, where ProAssurance is deemed to have influence because it holds a greater than a minor interest are accounted for using the equity method. Under the equity method, the recorded basis of the investment is adjusted each period for the investor’s pro rata share of the investee’s income or loss. Investments in unconsolidated subsidiaries include tax credit partnerships accounted for using the equity method, whereby ProAssurance’s proportionate share of income or loss is included in equity in earnings (loss) of unconsolidated subsidiaries. Tax credits received from the partnerships are recognized in the period received in the Consolidated Statement of Income and Comprehensive Income as either a reduction to current tax expense or as a component of deferred tax expense if they cannot be utilized in the period received. Business Owned Life Insurance ProAssurance owns life insurance contracts on certain management employees. The life insurance contracts are carried at their current cash surrender value. Changes in the cash surrender value are included in income in the current period as investment income. Death proceeds from the contracts are recorded when the proceeds become payable under the policy terms. Realized Gains and Losses Realized investment gains and losses are recognized on the first-in, first-out basis for GAAP purposes and on the specific identification basis for tax purposes. Impairments ProAssurance evaluates its available-for-sale investment securities, which at December 31, 2020 and 2019 consisted entirely of fixed maturity securities, on at least a quarterly basis for the purpose of determining whether declines in fair value below recorded cost basis represent a credit loss. The Company considers a credit loss to have occurred: • if there is intent to sell the security; • if it is more likely than not that the security will be required to be sold before full recovery of its amortized cost basis; or • if the entire amortized basis of the security is not expected to be recovered. The assessment of whether the amortized cost basis of a security is expected to be recovered requires the Company to make assumptions regarding various matters affecting future cash flows. The choice of assumptions is subjective and requires the use of judgment. Actual credit losses experienced in future periods may differ from the Company’s estimates of those credit losses. Methodologies used to estimate the present value of expected cash flows are: The estimate of expected cash flows is determined by projecting a recovery value and a recovery time frame and assessing whether further principal and interest will be received. ProAssurance considers various factors in projecting recovery values and recovery time frames, including the following: • third-party research and credit rating reports; • the current credit standing of the issuer, including credit rating downgrades, whether before or after the balance sheet date; • the extent to which the decline in fair value is attributable to credit risk specifically associated with the security or its issuer; • internal assessments and the assessments of external portfolio managers regarding specific circumstances surrounding an investment, which indicate the investment is more or less likely to recover its amortized cost than other investments with a similar structure; • for asset-backed securities, the origination date of the underlying loans, the remaining average life, the probability that credit performance of the underlying loans will deteriorate in the future and ProAssurance's assessment of the quality of the collateral underlying the loan; • failure of the issuer of the security to make scheduled interest or principal payments; • any changes to the rating of the security by a rating agency; • recoveries or additional declines in fair value subsequent to the balance sheet date; • adverse legal or regulatory events; • significant deterioration in the market environment that may affect the value of collateral (e.g. decline in real estate prices); • significant deterioration in economic conditions; and • disruption in the business model resulting from changes in technology or new entrants to the industry. If deemed appropriate and necessary, a discounted cash flow analysis is performed to confirm whether a credit loss exists and, if so, the amount of the credit loss. ProAssurance uses the single best estimate approach for available-for-sale debt securities and considers all reasonably available data points, including industry analyses, credit ratings, expected defaults and the remaining payment terms of the debt security. For fixed rate available-for-sale debt securities, cash flows are discounted at the security's effective interest rate implicit in the security at the date of acquisition. If the available-for-sale debt security’s contractual interest rate varies based on subsequent changes in an independent factor, such as an index or rate, for example, the prime rate, the LIBOR, or the U.S. Treasury bill weekly average, that security’s effective interest rate is calculated based on the factor as it changes over the life of the security. If ProAssurance intends to sell a debt security or believes it will more likely than not be required to sell a debt security before the amortized cost basis is recovered, any existing allowance will be written off against the security's amortized cost basis, with any remaining difference between the debt security's amortized cost basis and fair value recognized as an impairment loss in earnings. Exclusive of securities where there is an intent to sell or where it is not more likely than not that the security will be required to be sold before recovery of its amortized cost basis, impairment for debt securities is separated into a credit component and a non-credit component. The credit component of an impairment is the difference between the security’s amortized cost basis and the present value of its expected future cash flows, while the non-credit component is the remaining difference between the security’s fair value and the present value of expected future cash flows. An allowance for expected credit losses will be recorded for the expected credit losses through income and the non-credit component is recognized in OCI. The amount of impairment recognized is limited to the excess of the amortized cost over the fair value of the available-for-sale debt security. |
Derivatives | Derivatives ProAssurance records derivative instruments at fair value in the Consolidated Balance Sheets. ProAssurance accounts for the changes in fair value of derivatives depending on whether the derivative is designated as a hedging instrument and if so, the type of hedging relationship. For derivative instruments not designated as hedging instruments, ProAssurance recognizes the change in fair value of the derivative in earnings during the period of change. As of December 31, 2020, ProAssurance has not designated any derivative instruments as hedging instruments and does not use derivative instruments for trading purposes. |
Foreign Currency | Foreign Currency The functional currency of all ProAssurance foreign subsidiaries is the U.S. dollar. In recording foreign currency transactions, revenue and expense items are converted to U.S. dollars at the exchange rate prevailing at the transaction date. Monetary assets and liabilities originating in currencies other than the U.S. dollar are remeasured to U.S. dollars at the rates of exchange in effect as of the balance sheet date. The resulting foreign currency gains or losses are recognized in the |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of the Consolidated Balance Sheets and Consolidated Statements of Cash Flows, ProAssurance considers all demand deposits and overnight investments to be cash equivalents. |
Income Taxes/Deferred Taxes | Income Taxes/Deferred Taxes ProAssurance files a consolidated federal income tax return. Tax-related interest and penalties are recognized as components of tax expense. ProAssurance evaluates tax positions taken on tax returns and recognizes positions in the financial statements when it is more likely than not that the position will be sustained upon resolution with a taxing authority. If recognized, the benefit is measured as the largest amount of benefit that has a greater than fifty percent probability of being realized. Uncertain tax positions are reviewed each period by considering changes in facts and circumstances, such as changes in tax law, interactions with taxing authorities and developments in case law, and adjustments would be made if considered necessary. Adjustments to unrecognized tax benefits may affect income tax expense, and the settlement of uncertain tax positions may require the use of cash. Other than differences related to timing, no significant adjustments were considered necessary during the years ended December 31, 2020 or 2019. Deferred federal income taxes arise from the recognition of temporary differences between the basis of assets and liabilities determined for financial reporting purposes and the basis determined for income tax purposes. ProAssurance’s temporary differences principally relate to loss reserves, unearned and advanced premiums, DPAC, compensation related items, tax credit carryforwards, unrealized investment gains (losses) and basis differentials in fixed assets, intangible assets and operating leases and investments. Deferred tax assets and liabilities are measured using the enacted tax rates expected to be in effect when such benefits are realized. ProAssurance reviews its deferred tax assets quarterly for impairment. If management determines that it is more likely than not that some or all of a deferred tax asset will not be realized, a valuation allowance is recorded to reduce the carrying value of the asset. In assessing the need for a valuation allowance, management is required to make certain judgments and assumptions about the future operations of ProAssurance based on historical experience and |
Leases | Leases ProAssurance is involved in a number of leases, primarily for office facilities. The Company determines if an arrangement is a lease at the inception date of the contract and classifies all leases as either financing or operating. Operating leases are included in operating lease ROU assets and operating lease liabilities on the Consolidated Balance Sheet. The ROU asset represents the right to use the underlying asset for the lease term. As of December 31, 2020, ProAssurance has no leases that are classified as financing leases. Operating ROU assets and operating lease liabilities are initially recognized as of the lease commencement date based on the present value of the remaining lease payments, discounted over the term of the lease using a discount rate determined based on information available as of the commencement date. As the majority of ProAssurance's lessors do not provide an implicit discount rate, the Company uses its collateralized incremental borrowing rate in determining the present value of remaining lease payments. Due to the adoption of ASU 2016-02, the Company used its collateralized incremental borrowing rate as of January 1, 2019 for operating leases that commenced prior to that date. Subsequent to the initial recognition, the operating ROU asset and operating lease liability are amortized and accreted, respectively, over the lease term in a manner that results in a straight-line operating lease expense. Operating lease expense is included as a component of operating expense on the Consolidated Statements of Income and Comprehensive Income for the year ended December 31, 2020 and 2019. Leases with an initial term of twelve months or less are considered short-term and are not recorded on the Consolidated Balance Sheet; lease expense for these leases is also recognized on a straight-line basis over the lease term. Additionally, for leases entered into or reassessed after the adoption of ASU 2016-02 on January 1, 2019, ProAssurance accounts for lease and non-lease components of a contract as a single lease component. Operating lease ROU assets are evaluated for impairment at the asset group level whenever events or changes in circumstances indicate that the carrying amount of the asset group may not be recoverable. The carrying amount of an asset group, which includes the operating lease ROU asset and the related operating lease liability, is not recoverable if the carrying amount exceeds the sum of the undiscounted cash flows expected to result from the use of the asset group over the life of the primary asset in the asset group. That assessment is based on the carrying amount of the asset group, including the operating lease ROU asset and the related operating lease liability, at the date it is tested for recoverability and an impairment loss is measured and recognized as the amount by which the carrying amount of the asset group exceeds its fair value. Any impairment loss is allocated to each asset in the asset group, including the operating ROU asset. When a lease of an office facility is to be abandoned and will not be subleased, the Company first evaluates whether or not the operating lease ROU asset’s inclusion in an existing asset group continues to be appropriate and if the commitment to abandon the lease constitutes a change in circumstances requiring the operating lease ROU asset, or the larger asset group, to be tested for impairment. If an impairment test is required, it is performed in the same manner as discussed above. Any remaining carrying value of the operating lease ROU asset is amortized from the date the Company commits to a plan to abandon the lease to the expected date that the Company will cease to use the leased property. Leases to be abandoned in which the Company has the intent or practical ability to sublease continue to be accounted for under a held and use model, with no change to the amortization period of the operating lease ROU asset, and are evaluated for impairment as a separate asset group at the date the sublease is executed. |
Real Estate | Real Estate Real Estate balances are reported at cost or, for properties acquired in business combinations, estimated fair value on the date of acquisition, less accumulated depreciation. Real estate principally consists of properties in use as corporate offices. Depreciation is computed over the estimated useful lives of the related property using the straight-line method. Excess office capacity is leased or made available for lease; rental income is included in other income, and real estate expenses are included in operating expense. |
Intangible Assets | Intangible AssetsIntangible assets with definite lives are amortized over the estimated useful life of the asset. Amortizable intangible assets primarily consist of policyholder relationships, renewal rights and trade names. Intangible assets with an indefinite life, primarily state licenses, are not amortized. Indefinite lived intangible assets are evaluated for impairment on an annual basis or upon the occurrence of certain triggering events or substantive changes in circumstances that indicate the intangible asset may be impaired. Amortizable intangible assets and other long-lived assets are tested for impairment at the asset group level upon the occurrence of certain triggering events or substantive changes in circumstances that indicate the carrying amount of the asset group may not be recoverable. An impairment loss is recognized when estimated undiscounted future cash flows expected to result from the use of the asset group are less than the carrying amounts of the related asset group. Impairment losses are measured as the amount by which the carrying amount of the asset groups exceed their fair values. The Company's asset groups generally correspond to the same level at which goodwill is tested for impairment. |
Goodwill | Goodwill Goodwill is tested for impairment annually or more frequently if circumstances indicate an impairment may have occurred. The date of the Company's annual goodwill impairment testing is October 1. Impairment of goodwill is tested at the reporting unit level, which is consistent with the Company's reportable segments identified in Note 16 of the Notes to Consolidated Financial Statements. During the third quarter of 2020, the Company recorded a goodwill impairment charge of $161.1 million, and the facts and circumstances that led to this impairment and how the fair value of each reporting unit was estimated, including the significant assumptions used and other details are outlined in the following section. Interim Impairment Assessments As disclosed in the Company's June 30, 2020 report on Form 10-Q, COVID-19 has caused significant market volatility impacting its actual and projected results along with a decline in the Company's stock price; and the Company performed a quantitative assessment on the Specialty P&C and Workers' Compensation Insurance reporting units. As a result of the interim goodwill impairment assessment in the second quarter of 2020, management concluded that the fair value of each of the Specialty P&C and Workers' Compensation Insurance reporting units were greater than their carrying value as of the testing date; therefore, goodwill was not impaired and no further impairment testing was required at that time. As the impacts persisted into the third quarter, management performed new quantitative assessments of goodwill on the Company's Specialty P&C and Workers' Compensation Insurance reporting units using updated marketplace data. The updated data, which was significantly influenced by the Company's continued depressed stock price relative to both the Company's book value and the comparable stock prices of its peers, impacted a number of key variables in the Company's analysis including the determination of a higher discount rate and lower valuation multiples. In addition, new guidance given by the Federal Reserve during the period regarding the expectation of a prolonged low interest rate environment impacted the Company's analysis. This analysis during the third quarter of 2020 indicated an impairment of the goodwill associated with the Company's Specialty P&C reporting unit and accordingly the Company recorded a $161.1 million charge to goodwill during the third quarter of 2020. For each of the interim impairment assessments performed in the second and third quarters of 2020, management estimated the fair value of the reporting units using both an income approach and a market approach using marketplace data that was current at the time of each respective analysis. The estimate of fair value derived from the income approach was based on the present value of expected future cash flows, including terminal value, utilizing a market-based weighted average cost of capital determined separately for each reporting unit. The estimate of fair value derived from the market approach was based on price to book multiple data. The determination of fair value involved the use of significant estimates and assumptions, including revenue growth rates, operating margins, capital requirements, tax rates, terminal growth rates, discount rates, comparable public companies and synergistic benefits available to market participants. In addition, management made certain judgments and assumptions in allocating shared assets and liabilities to individual reporting units to determine the carrying amount of each reporting unit. Management also performed impairment tests of certain of the Company's definite and indefinite lived intangible assets for which a triggering event was deemed to have occurred, as discussed above. Based upon these impairment tests, no impairment of ProAssurance's definite or indefinite lived intangible assets was identified at September 30, 2020. Annual Impairment Assessment Subsequent to performing the aforementioned interim impairment assessments, the Company performed its annual goodwill impairment assessment as of October 1, 2020. When testing goodwill for impairment on the Company's annual test date, it has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the estimated fair value of a reporting unit is less than its carrying amount. If the Company elects to perform a qualitative assessment and determine that an impairment is more likely than not, the Company is then required to perform a quantitative impairment test; otherwise, no further analysis is required. The Company also may elect not to perform the qualitative assessment and, instead, proceed directly to the quantitative impairment test. Performance of the qualitative goodwill impairment assessment requires judgment in identifying and considering the significance of relevant key factors, events, and circumstances that affect the fair values of the Company's reporting units. This requires consideration and assessment of external factors such as macroeconomic, industry, and market conditions, as well as entity-specific factors, such as the Company's actual and planned financial performance. The Company also gives consideration to the difference between each reporting unit's fair value and carrying value as of the most recent date that a fair value measurement was performed. If the results of the qualitative assessment conclude that it is not more likely than not that the fair value of a reporting unit exceeds its carrying value, additional quantitative impairment testing is performed. The quantitative goodwill impairment test involves comparing the fair value of a reporting unit with its carrying value including goodwill. If the fair value of a reporting unit exceeds its carrying value, the reporting unit's goodwill is considered not to be impaired. However, if the carrying value of a reporting unit exceeds its fair value, an impairment loss is recorded in an amount equal to that excess. Any impairment charge recognized is limited to the amount of the respective reporting unit's allocated goodwill. Determining the fair value of a reporting unit under the quantitative goodwill impairment test requires judgment and often involves the use of significant estimates and assumptions, including an assessment of external factors such as macroeconomic, industry, and market conditions, as well as entity-specific factors, such as actual and planned financial performance. These estimates and assumptions could have a significant impact on whether or not an impairment charge is recognized and the magnitude of any such charge. To assist management in the process of determining any potential goodwill impairment, the Company may review and consider appraisals from accredited independent valuation firms. Estimates of fair value are primarily determined using discounted cash flows and market comparisons. These approaches involve significant estimates and assumptions, including projected future cash flows (including timing), discount rates reflecting the risks inherent in those future cash flows, perpetual growth rates, and selection of appropriate market comparable metrics and transactions. As of the most recent goodwill impairment test performed on October 1, 2020, the Company elected to perform a qualitative goodwill impairment test for its Workers' Compensation Insurance and Segregated Portfolio Cell Reinsurance |
Treasury Shares | Treasury Shares Treasury shares are reported at cost and are reflected on the Consolidated Balance Sheets as an unallocated reduction of total equity. |
Share-Based Payments | Share-Based Payments Compensation cost for share-based payments is measured based on the grant-date fair value of the award, recognized over the period in which the employee is required to provide service in exchange for the award. Excess tax benefits (tax deductions realized in excess of the compensation costs recognized for the exercise of the awards, multiplied by the incremental tax rate) are reported as operating cash inflows. |
Subsequent Events | Subsequent Events ProAssurance evaluates events that occurred subsequent to December 31, 2020 for recognition or disclosure in its Consolidated Financial Statements. |
Accounting Changes Adopted and Accounting Changes Not Yet Adopted | Accounting Changes Adopted Improvements to Financial Instruments - Credit Losses (ASU 2016-13) Effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years, the FASB issued guidance that replaces the incurred loss impairment methodology, which delays recognition of credit losses until a probable loss has been incurred, with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. Included in the scope of this guidance are the Company's available-for-sale fixed maturity securities and its financial assets held at amortized cost. Under the new guidance, credit losses are required to be recorded through an allowance for expected credit losses account and the income statement will reflect the initial recognition of lifetime expected credit losses for any newly recognized financial assets as well as increases or decreases of expected credit losses that have taken place during the period. Credit losses on available-for-sale fixed maturity securities are required to be presented as an allowance, rather than as a write-down of the asset, limited to the amount by which the fair value is below amortized cost. ProAssurance adopted this guidance beginning January 1, 2020 using a modified retrospective application for the portion of the new guidance that relates to its premiums and reinsurance receivables and a prospective application for the portion of the new guidance that relates to its available-for-sale fixed maturity securities. ProAssurance recorded a cumulative-effect adjustment of $4.1 million, net of related tax impacts, to beginning retained earnings as of January 1, 2020 to increase its consolidated allowance for expected credit losses related to its premiums receivable. ProAssurance determined that estimated expected credit losses associated with the Company's other financial assets held at amortized cost included in the scope of this new guidance was nominal as of January 1, 2020. Adoption of this guidance had no material effect on ProAssurance's results of operations, financial position or cash flows. Simplifying the Test for Goodwill Impairment (ASU 2017-04) Effective for the fiscal years beginning after December 15, 2019 and interim periods within those fiscal years, the FASB issued guidance that simplifies the requirements to test goodwill for impairment for business entities that have goodwill reported in their financial statements. The guidance eliminates the second step of the impairment test which measures a goodwill impairment loss by comparing the implied fair value of a reporting unit's goodwill with the carrying amount or the reporting unit, with the impairment loss not to exceed the carrying amount of goodwill. This new guidance is expected to reduce the complexity and cost of future tests of goodwill for impairment. In addition, the guidance also eliminates the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment. ProAssurance adopted the guidance beginning January 1, 2020. Adoption of this guidance did not have a significant impact on the Company's interim quantitative goodwill impairment tests for the Workers' Compensation Insurance or Specialty P&C reporting units performed during the second quarter of 2020 or on the interim quantitative goodwill impairment tests for the Workers' Compensation Insurance or Segregated Portfolio Cell Reinsurance reporting units performed during the third quarter of 2020 as the fair value of each of these reporting units exceeded their carrying amounts (see previous discussion of these interim impairment assessments). Adoption of this guidance simplified the Company's interim quantitative goodwill impairment test for the Specialty P&C reporting unit during the third quarter of 2020 as the Company measured the impairment loss on this reporting unit by the amount that the carrying amount of the reporting unit exceeded its fair value, with the impairment charge not to exceed the carrying amount of goodwill. Changes to the Disclosure Requirements for Fair Value Measurement (ASU 2018-13) Effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years, the FASB issued guidance that eliminates, modifies and adds certain disclosure requirements related to fair value measurements. The new guidance eliminates the requirements to disclose the transfers between Level 1 and Level 2 of the fair value hierarchy, the policy for the timing of transfers between levels of the fair value hierarchy and the valuation process for Level 3 fair value measurements while it modifies existing disclosure requirements related to measurement uncertainty and the requirement to disclose the timing of liquidation of an investee's assets for investments in certain entities that calculate NAV. The new guidance also adds requirements to disclose changes in unrealized gains and losses included in OCI for recurring Level 3 fair value measurements as well as the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements. An entity is permitted to early adopt any eliminated or modified disclosure requirements and delay adoption of the additional disclosure requirements until the guidance is effective. During the third quarter of 2018, ProAssurance elected to early adopt the provisions that eliminate and modify certain disclosure requirements within Note 2 on a retrospective basis, and adopted the additional disclosure requirements beginning January 1, 2020. Adoption of this guidance had no material effect on ProAssurance’s results of operations, financial position or cash flows as it affected disclosures only. Intangibles - Goodwill and Other-Internal-Use Software (ASU 2018-15) Effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years, the FASB amended the new standard regarding accounting for implementation costs in cloud computing arrangements. The amended guidance substantially aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. ProAssurance adopted the guidance beginning January 1, 2020, and adoption had no material effect on ProAssurance’s results of operations, financial position or cash flows. Targeted Improvements to Related Party Guidance for VIEs (ASU 2018-17) Effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years, the FASB amended guidance which improves the consistency of the application of the VIE guidance for common control arrangements. The amended guidance requires an entity to consider indirect interests held through related parties under common control on a proportional basis rather than as the equivalent of a direct interest in its entirety when determining whether a decision-making fee is a variable interest. ProAssurance adopted the guidance beginning January 1, 2020. ProAssurance does not have any material indirect interests held through related parties under common control; therefore, adoption had no material effect on ProAssurance’s results of operations, financial position or cash flows. Collaborative Arrangements (ASU 2018-18) Effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years, the FASB issued new guidance which clarifies how to assess whether certain transactions between participants in a collaborative arrangement should be accounted for under the revenue from contracts with customers accounting standard when the counterpart is a customer. In addition, the guidance precludes an entity from presenting consideration from a transaction in a collaborative arrangement as revenue from contracts with customers if the counterparty is not a customer for that transaction. ProAssurance adopted the guidance beginning January 1, 2020, and adoption had no material effect on ProAssurance’s results of operations, financial position or cash flows. Reference Rate Reform (ASU 2020-04) The FASB issued guidance intended to assist stakeholders during the market-wide reference rate transition period and is effective for a limited period between March 12, 2020 and December 31, 2022. The guidance provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference LIBOR or another reference rate that is expected to be discontinued because of reference rate reform. ProAssurance has exposure to LIBOR-based financial instruments through its variable rate Mortgage Loans and Revolving Credit Agreement; however, these agreements include provisions for an alternative benchmark rate if LIBOR ceases to exist, which do not materially change the liability exposure. Additionally, ProAssurance has exposure to LIBOR in its available-for-sale fixed maturities portfolio which represented approximately 6% of total investments, or $191 million as of December 31, 2020; 34% of these investments with exposure to LIBOR were issued since 2019 and include provisions for an alternative benchmark rate. Optional expedients for contract modifications include a prospective adjustment that does not require contract remeasurement or reassessment of a previous accounting determination; therefore, the modified contract is accounted for as a continuation of the existing contract. ProAssurance adopted the guidance beginning March 12, 2020, and adoption had no material effect on ProAssurance's results of operations, financial position or cash flows. Simplifying the Accounting for Income Taxes (ASU 2019-12) Effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years, the FASB issued new guidance which is intended to simplify various aspects related to accounting for income taxes. In addition, it removes certain exceptions to the general principles in the income tax guidance in the codification and also clarifies and amends existing guidance to improve consistent application. ProAssurance elected to early adopt this guidance using a prospective application during the second quarter of 2020. The most impactful provision of the new guidance on the Company is the removal of the limitation on the tax benefit recognized on pre-tax losses during interim periods in which the year-to-date loss exceeds the expected loss for the fiscal year. Accounting Changes Not Yet Adopted Clarifying the Interactions between Investments - Equity Securities, Investments - Equity Method and Joint Ventures, and Derivatives and Hedging (ASU 2020-01) Effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years, the FASB amended guidance that clarifies the accounting for the transition into and out of the equity method and measuring certain purchased options and forward contracts to acquire investments. ProAssurance plans to adopt the guidance beginning January 1, 2021, and adoption is not expected to have a material effect on ProAssurance's results of operations, financial position or cash flows. |
Accounting Policies (Tables)
Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of rollforward of the allowance for expected credit losses related to premiums receivable | The following tables present a roll forward of the allowance for expected credit losses related to the Company's premiums receivable for the year ended December 31, 2020. (In thousands) Premiums Receivable, Net Allowance for Expected Credit Losses Balance, December 31, 2019 $ 249,540 $ 1,590 Cumulative-effect adjustment on January 1, 2020, before tax - ASU 2016-13 adoption 5,160 Provision for expected credit losses 827 Write offs charged against the allowance (2,019) Recoveries of amounts previously written off 573 Balance, December 31, 2020 $ 201,395 $ 6,131 |
Schedule of non-amortizable intangible assets | The following table provides additional information regarding ProAssurance's intangible assets. Gross Carrying Value Accumulated Amortization Amortization Expense December 31 December 31 Year Ended December 31 (In millions) 2020 2019 2020 2019 2020 2019 2018 Intangible Assets Non-amortizable $ 25.8 $ 25.8 Amortizable 98.8 97.7 $ 58.9 $ 52.7 $ 6.2 $ 6.1 $ 6.2 Total Intangible Assets $ 124.6 $ 123.5 |
Schedule of amortizable intangible assets | The following table provides additional information regarding ProAssurance's intangible assets. Gross Carrying Value Accumulated Amortization Amortization Expense December 31 December 31 Year Ended December 31 (In millions) 2020 2019 2020 2019 2020 2019 2018 Intangible Assets Non-amortizable $ 25.8 $ 25.8 Amortizable 98.8 97.7 $ 58.9 $ 52.7 $ 6.2 $ 6.1 $ 6.2 Total Intangible Assets $ 124.6 $ 123.5 |
Schedule of other liabilities | Other liabilities at December 31, 2020 and 2019 consisted of the following: (In thousands) 2020 2019 SPC dividends payable $ 68,865 $ 55,763 Unpaid shareholder dividends 2,694 16,676 All other 110,480 100,817 Total other liabilities $ 182,039 $ 173,256 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Assets and liabilities measured at fair value | Fair values of assets measured at fair value on a recurring basis as of December 31, 2020 and December 31, 2019 are shown in the following tables. Where applicable, the tables also indicate the fair value hierarchy of the valuation techniques utilized to determine those fair values. For some assets, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. When this is the case, the asset is categorized based on the level of the most significant input to the fair value measurement. Assessments of the significance of a particular input to the fair value measurement require judgment and consideration of factors specific to the assets being valued. December 31, 2020 Fair Value Measurements Using Total (In thousands) Level 1 Level 2 Level 3 Fair Value Assets: Fixed maturities, available-for-sale U.S. Treasury obligations $ — $ 107,059 $ — $ 107,059 U.S. Government-sponsored enterprise obligations — 12,261 — 12,261 State and municipal bonds — 332,920 — 332,920 Corporate debt, multiple observable inputs — 1,326,077 — 1,326,077 Corporate debt, limited observable inputs — — 3,265 3,265 Residential mortgage-backed securities — 274,509 2,032 276,541 Agency commercial mortgage-backed securities — 13,310 — 13,310 Other commercial mortgage-backed securities — 113,092 — 113,092 Other asset-backed securities — 266,345 6,661 273,006 Fixed maturities, trading — 48,456 — 48,456 Equity investments Financial 13,810 — — 13,810 Utilities/Energy 564 — — 564 Consumer oriented 1,262 — — 1,262 Industrial 2,240 — — 2,240 Bond funds 69,475 — — 69,475 All other 20,202 — — 20,202 Short-term investments 307,695 30,118 — 337,813 Other investments 1,509 42,607 — 44,116 Other assets — 329 — 329 Total assets categorized within the fair value hierarchy $ 416,757 $ 2,567,083 $ 11,958 2,995,798 Assets carried at NAV, which approximates fair value and which are not categorized within the fair value hierarchy, reported as a part of: Equity investments 12,548 Investment in unconsolidated subsidiaries 233,711 Total assets at fair value $ 3,242,057 December 31, 2019 Fair Value Measurements Using Total (In thousands) Level 1 Level 2 Level 3 Fair Value Assets: Fixed maturities, available-for-sale U.S. Treasury obligations $ — $ 110,467 $ — $ 110,467 U.S. Government-sponsored enterprise obligations — 17,340 — 17,340 State and municipal bonds — 296,093 — 296,093 Corporate debt, multiple observable inputs — 1,335,285 — 1,335,285 Corporate debt, limited observable inputs — — 5,079 5,079 Residential mortgage-backed securities — 208,408 — 208,408 Agency commercial mortgage-backed securities — 8,221 — 8,221 Other commercial mortgage-backed securities — 71,868 — 71,868 Other asset-backed securities — 233,032 2,992 236,024 Fixed maturities, trading — 47,284 — 47,284 Equity investments Financial 40,294 — — 40,294 Utilities/Energy 21,195 — — 21,195 Consumer oriented 29,288 — — 29,288 Industrial 26,440 — — 26,440 Bond funds 58,346 — — 58,346 All other 52,512 — — 52,512 Short-term investments 317,313 22,594 — 339,907 Other investments 219 32,713 3,086 36,018 Other assets — 760 — 760 Total assets categorized within the fair value hierarchy $ 545,607 $ 2,384,065 $ 11,157 2,940,829 Assets carried at NAV, which approximates fair value and which are not categorized within the fair value hierarchy, reported as a part of: Equity investments 22,477 Investment in unconsolidated subsidiaries 270,524 Total assets at fair value $ 3,233,830 |
Summary of quantitative information about Level 3 fair value measurements | Quantitative Information Regarding Level 3 Valuations Fair Value at ($ in thousands) December 31, 2020 December 31, 2019 Valuation Technique Unobservable Input Range Assets: Corporate debt, limited observable inputs $3,265 $5,079 Market Comparable Comparability Adjustment 0% - 5% (2.5%) Discounted Cash Flows Comparability Adjustment 0% - 5% (2.5%) Residential mortgage-backed securities $2,032 $— Market Comparable Comparability Adjustment 0% - 5% (2.5%) Discounted Cash Flows Comparability Adjustment 0% - 5% (2.5%) Other asset-backed securities $6,661 $2,992 Market Comparable Comparability Adjustment 0% - 5% (2.5%) Discounted Cash Flows Comparability Adjustment 0% - 5% (2.5%) Other investments $— $3,086 Discounted Cash Flows Comparability Adjustment 0% - 10% (5%) |
Summary of changes in the fair value of assets measured at fair value | The following tables (the Level 3 Tables) present summary information regarding changes in the fair value of assets measured at fair value using Level 3 inputs. December 31, 2020 Level 3 Fair Value Measurements – Assets (In thousands) Corporate Debt Asset-backed Securities Other Investments Total Balance December 31, 2019 $ 5,079 $ 2,992 $ 3,086 $ 11,157 Total gains (losses) realized and unrealized: Included in earnings, as a part of: Net investment income (2) (18) — (20) Net realized investment gains (losses) — (8) 151 143 Included in other comprehensive income 216 109 — 325 Purchases 2,869 20,490 — 23,359 Sales (2,178) (4,346) — (6,524) Transfers in 945 605 — 1,550 Transfers out (3,664) (11,131) (3,237) (18,032) Balance December 31, 2020 $ 3,265 $ 8,693 $ — $ 11,958 Change in unrealized gains (losses) included in earnings for the above period for Level 3 assets held at period-end $ — $ — $ 151 $ 151 December 31, 2019 Level 3 Fair Value Measurements – Assets (In thousands) Corporate Debt Asset-backed Securities Other Investments Total Balance December 31, 2018 $ 4,322 $ 3,850 $ 3 $ 8,175 Total gains (losses) realized and unrealized: Included in earnings, as a part of: Net investment income 2 (204) — (202) Net realized investment gains (losses) — — 151 151 Included in other comprehensive income 37 202 — 239 Purchases 3,575 — 3,091 6,666 Sales (3,702) (494) (172) (4,368) Transfers in 3,095 2,216 418 5,729 Transfers out (2,250) (2,578) (405) (5,233) Balance December 31, 2019 $ 5,079 $ 2,992 $ 3,086 $ 11,157 Change in unrealized gains (losses) included in earnings for the above period for Level 3 assets held at period-end $ — $ — $ 164 $ 164 |
Schedule of investments in LLCs and limited partnerships | The amount of ProAssurance's unfunded commitments related to these investments as of December 31, 2020 and fair values of these investments as of December 31, 2020 and 2019 were as follows: Unfunded Fair Value (In thousands) December 31, 2020 December 31, 2020 December 31, 2019 Equity investments: Mortgage fund (1) None $ 12,548 $ 22,477 Investment in unconsolidated subsidiaries: Private debt funds (2) $12,395 16,387 19,011 Long equity fund (3) None — 5,293 Long/short equity funds (4) None 596 30,542 Non-public equity funds (5) $44,252 138,357 120,343 Multi-strategy fund of funds (6) None — 1,951 Credit funds (7) $1,937 34,848 42,415 Long/short commodities fund (8) None — 14,519 Strategy focused funds (9) $38,103 43,523 36,450 233,711 270,524 Total investments carried at NAV $ 246,259 $ 293,001 Below is additional information regarding each of the investments listed in the table above as of December 31, 2020. (1) This investment fund is focused on the structured mortgage market. The fund primarily invests in U.S. Agency mortgage-backed securities. Redemptions are allowed at the end of any calendar quarter with a prior notice requirement of 65 days and are paid within 45 days at the end of the redemption dealing day. (2) This investment is comprised of interests in two unrelated LP funds that are structured to provide interest distributions primarily through diversified portfolios of private debt instruments. One LP allows redemption by special consent, while the other does not permit redemption. Income and capital are to be periodically distributed at the discretion of the LPs over an anticipated time frame that spans from three (3) This fund is a LP that holds long equities of public international companies and was fully redeemed during the second quarter of 2020. (4) This investment holds primarily long and short North American equities and targets absolute returns using strategies designed to take advantage of market opportunities. Redemptions are permitted; however, redemptions above specified thresholds (lowest threshold is 90%) may be only partially payable until after a fund audit is completed and are then payable within 30 days. (5) This investment is comprised of interests in multiple unrelated LP funds, each structured to provide capital appreciation through diversified investments in private equity, which can include investments in buyout, venture capital, debt including senior, second lien and mezzanine, distressed debt, collateralized loan obligations and other private equity-oriented LPs. Two of the LPs allow redemption by terms set forth in the LP agreements; the others do not permit redemption. Income and capital are to be periodically distributed at the discretion of the LP over time frames that are anticipated to span up to ten years. (6) This fund is a LLC structured to build and manage low volatility, multi-manager portfolios that have little or no correlation to the broader fixed income and equity security markets. Redemptions are not permitted but offers to repurchase units of the LLC may be extended periodically. This fund was fully redeemed during the fourth quarter of 2020. (7) This investment is comprised of four unrelated LP funds. Two funds seek to obtain superior risk-adjusted absolute returns through a diversified portfolio of debt securities, including bonds, loans and other asset-backed instruments. A third fund focuses on private middle market company mezzanine loans, while the remaining fund seeks event driven opportunities across the corporate credit spectrum. Two funds are allowed redemptions at any quarter-end with a prior notice requirement of 90 days; one fund permits redemption at any quarter-end with a prior notice requirement of 180 days and one fund does not allow redemptions. For the fund that does not allow redemptions, income and capital are to be periodically distributed at the discretion of the LP over time frames that are anticipated to span up to twelve years. (8) This fund is a LLC invested across a broad range of commodities and focuses primarily on market neutral, relative value strategies, seeking to generate absolute returns with low correlation to broad commodity, equity and fixed income markets. This fund was fully redeemed during the second quarter of 2020. (9) This investment is comprised of multiple unrelated LPs/LLCs funds. One fund is a LLC focused on investing in North American consumer products companies, comprised of equity and equity-related securities, as well as debt instruments. A second fund is focused on aircraft investments, along with components and assets related to aircrafts. For both funds, redemptions are not permitted. Another fund is a LP focused on North American energy infrastructure assets that allows redemption with consent of the General Partner. The remaining funds are real estate focused LPs, one of which allows for redemption with prior notice. |
Financial instruments not measured at fair value | The following table provides the estimated fair value of the Company's financial instruments that, in accordance with GAAP for the type of investment, are measured using a methodology other than fair value. Fair values provided primarily fall within the Level 3 fair value category. December 31, 2020 December 31, 2019 (In thousands) Carrying Fair Carrying Fair Financial assets: BOLI $ 67,847 $ 67,847 $ 66,112 $ 66,112 Other investments $ 2,952 $ 2,952 $ 2,931 $ 2,931 Other assets $ 31,128 $ 31,141 $ 28,645 $ 28,650 Financial liabilities: Senior notes due 2023* $ 250,000 $ 269,160 $ 250,000 $ 273,865 Mortgage Loans* $ 36,113 $ 36,113 $ 37,617 $ 37,617 Other liabilities $ 30,334 $ 30,334 $ 27,953 $ 27,953 * Carrying value excludes unamortized debt issuance costs. |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of amortized cost and estimated fair value of available-for-sale fixed maturities and equity securities | Available-for-sale fixed maturities at December 31, 2020 and December 31, 2019 included the following: December 31, 2020 (In thousands) Amortized Allowance for Expected Credit Losses Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Fixed maturities, available-for-sale U.S. Treasury obligations $ 104,097 $ — $ 2,985 $ 23 $ 107,059 U.S. Government-sponsored enterprise obligations 12,103 — 158 — 12,261 State and municipal bonds 316,022 — 16,937 39 332,920 Corporate debt 1,267,992 552 63,204 1,302 1,329,342 Residential mortgage-backed securities 269,752 — 7,171 382 276,541 Agency commercial mortgage-backed securities 12,623 — 687 — 13,310 Other commercial mortgage-backed securities 109,244 — 4,788 940 113,092 Other asset-backed securities 269,742 — 4,006 742 273,006 $ 2,361,575 $ 552 $ 99,936 $ 3,428 $ 2,457,531 December 31, 2019 (In thousands) Amortized Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Fixed maturities, available-for-sale U.S. Treasury obligations $ 109,060 $ 1,533 $ 126 $ 110,467 U.S. Government-sponsored enterprise obligations 17,215 125 — 17,340 State and municipal bonds 287,658 9,110 675 296,093 Corporate debt 1,308,889 33,050 1,575 1,340,364 Residential mortgage-backed securities 205,588 3,139 319 208,408 Agency commercial mortgage-backed securities 8,054 182 15 8,221 Other commercial mortgage-backed securities 70,621 1,468 221 71,868 Other asset-backed securities 234,219 1,958 153 236,024 $ 2,241,304 $ 50,565 $ 3,084 $ 2,288,785 |
Schedule of available for sale securities by contractual maturity | The recorded cost basis and estimated fair value of available-for-sale fixed maturities at December 31, 2020, by contractual maturity, are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. (In thousands) Amortized Due in one Due after Due after Due after Total Fair Fixed maturities, available-for-sale U.S. Treasury obligations $ 104,097 $ 23,049 $ 73,580 $ 10,430 $ — $ 107,059 U.S. Government-sponsored enterprise obligations 12,103 — 9,093 3,014 154 12,261 State and municipal bonds 316,022 14,466 141,826 158,927 17,701 332,920 Corporate debt 1,267,992 143,719 700,708 425,711 59,204 1,329,342 Residential mortgage-backed securities 269,752 276,541 Agency commercial mortgage-backed securities 12,623 13,310 Other commercial mortgage-backed securities 109,244 113,092 Other asset-backed securities 269,742 273,006 $ 2,361,575 $ 2,457,531 |
Schedule of investments held in a loss position | The following tables provide summarized information with respect to investments held in an unrealized loss position at December 31, 2020 and December 31, 2019, including the length of time the investment had been held in a continuous unrealized loss position. December 31, 2020 Total Less than 12 months 12 months or longer Fair Unrealized Fair Unrealized Fair Unrealized (In thousands) Value Loss Value Loss Value Loss Fixed maturities, available-for-sale U.S. Treasury obligations $ 14,390 $ 23 $ 14,390 $ 23 $ — $ — State and municipal bonds 6,416 39 6,416 39 — — Corporate debt 94,695 1,302 79,436 1,020 15,259 282 Residential mortgage-backed securities 34,928 382 34,509 381 419 1 Other commercial mortgage-backed securities 18,766 940 18,480 935 286 5 Other asset-backed securities 43,739 742 37,850 701 5,889 41 $ 212,934 $ 3,428 $ 191,081 $ 3,099 $ 21,853 $ 329 December 31, 2019 Total Less than 12 months 12 months or longer Fair Unrealized Fair Unrealized Fair Unrealized (In thousands) Value Loss Value Loss Value Loss Fixed maturities, available-for-sale U.S. Treasury obligations $ 25,959 $ 126 $ 15,305 $ 103 $ 10,654 $ 23 State and municipal bonds 36,565 675 35,621 674 944 1 Corporate debt 128,254 1,575 88,582 932 39,672 643 Residential mortgage-backed securities 59,291 319 28,048 63 31,243 256 Agency commercial mortgage-backed securities 459 15 158 — 301 15 Other commercial mortgage-backed securities 18,339 221 16,924 206 1,415 15 Other asset-backed securities 48,912 153 37,322 145 11,590 8 $ 317,779 $ 3,084 $ 221,960 $ 2,123 $ 95,819 $ 961 |
Schedule of a roll forward allowance for expected credit losses on available-for-sale fixed maturities | The following tables present a roll forward of the allowance for expected credit losses on available-for-sale fixed maturities for the year ended December 31, 2020. Year Ended December 31, 2020 (In thousands) Corporate Debt Total Balance December 31, 2019 $ — $ — Additional credit losses related to securities for which: No allowance for credit losses has been previously recognized 1,508 1,508 Reductions related to: Securities sold during the period (956) (956) Balance December 31, 2020 $ 552 $ 552 |
Schedule of other information regarding sales and purchases of fixed maturity available-for-sale securities | Other information regarding sales and purchases of fixed maturity available-for-sale securities is as follows: Year Ended December 31 (In millions) 2020 2019 2018 Proceeds from sales (exclusive of maturities and paydowns) $ 354.4 $ 177.1 $ 599.6 Purchases $ 917.0 $ 695.6 $ 780.7 |
Schedule of net investment income | Net investment income by investment category was as follows: Year Ended December 31 (In thousands) 2020 2019 2018 Fixed maturities $ 69,308 $ 72,593 $ 69,515 Equities 4,369 17,650 21,418 Short-term investments, including Other 2,683 7,493 5,649 BOLI 2,023 2,017 1,983 Investment fees and expenses (6,385) (6,484) (6,681) Net investment income $ 71,998 $ 93,269 $ 91,884 |
Schedule of investment in unconsolidated subsidiaries | ProAssurance's investment in unconsolidated subsidiaries were as follows: December 31, 2020 Carrying Value (In thousands) Percentage December 31, December 31, Qualified affordable housing project tax credit partnerships See below $ 27,719 $ 46,421 Other tax credit partnerships See below — 2,085 All other investments, primarily investment fund LPs/LLCs See below 282,810 310,314 $ 310,529 $ 358,820 |
Schedule of equity method investments | The results recorded and tax credits recognized related to ProAssurance's tax credit partnership investments were as follows: Year Ended December 31 (In thousands) 2020 2019 2018 Qualified affordable housing project tax credit partnerships Losses recorded $ 18,684 $ 19,231 $ 18,889 Tax credits recognized $ 17,465 $ 21,933 $ 18,474 Historic tax credit partnership Losses recorded $ 1,092 $ 1,672 $ 5,434 Tax credits recognized $ 412 $ — $ 2,567 |
Schedule of net realized investment gains (losses) | The following table provides detailed information regarding net realized investment gains (losses): Year Ended December 31 (In thousands) 2020 2019 2018 Total impairment losses: Corporate debt $ (1,745) $ (978) $ (490) Portion of impairment losses recognized in other comprehensive income before taxes: Corporate debt 237 227 — Net impairment losses recognized in earnings (1,508) (751) (490) Gross realized gains, available-for-sale fixed maturities 13,855 3,786 5,942 Gross realized (losses), available-for-sale fixed maturities (2,501) (538) (5,799) Net realized gains (losses), trading fixed maturities 288 74 (100) Net realized gains (losses), equity investments 13,192 20,577 12,230 Net realized gains (losses), other investments 3,883 1,626 1,340 Change in unrealized holding gains (losses), trading fixed maturities 501 705 (317) Change in unrealized holding gains (losses), equity investments (16,287) 30,674 (52,707) Change in unrealized holding gains (losses), convertible securities, carried at fair value 3,850 3,653 (3,849) Other 405 68 262 Net realized investment gains (losses) $ 15,678 $ 59,874 $ (43,488) |
Schedule of cumulative credit losses recorded in earnings related to impaired debt securities for which a portion of the OTTI has been recorded in OCI | The following table presents a roll forward of cumulative credit losses recorded in earnings related to impaired debt securities for which a portion of the impairment was recorded in OCI. Year Ended December 31 (In thousands) 2020 2019 2018 Balance beginning of period $ 470 $ 93 $ 1,313 Additional credit losses recognized during the period, related to securities for which: No impairment has been previously recognized 1,064 377 — Impairment has been previously recognized 258 — — Reductions due to: Securities sold during the period (realized) (1,240) — (1,220) Balance December 31 $ 552 $ 470 $ 93 |
Reinsurance (Tables)
Reinsurance (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Insurance [Abstract] | |
Summary of the effect of reinsurance on premiums written and earned | The effects of reinsurance for the years ended December 31, 2020, 2019 and 2018 were as follows: Year Ended December 31 (In thousands) 2020 2019 2018 Direct $ 814,298 $ 919,799 $ 910,198 Assumed 40,124 47,691 47,113 Ceded (106,721) (124,765) (122,397) Net premiums written $ 747,701 $ 842,725 $ 834,914 Direct $ 862,742 $ 926,035 $ 903,354 Assumed 43,555 45,668 41,535 Ceded (113,582) (124,171) (126,036) Net premiums earned $ 792,715 $ 847,532 $ 818,853 Losses and loss adjustment expenses $ 741,719 $ 871,780 $ 675,784 Reinsurance recoveries (80,272) (117,865) (82,574) Net losses and loss adjustment expenses $ 661,447 $ 753,915 $ 593,210 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Summary of components of deferred tax assets and liabilities | Significant components of ProAssurance’s deferred tax assets and liabilities were as follows: December 31 (In thousands) 2020 2019 Deferred tax assets Unpaid loss discount $ 36,452 $ 34,455 Unearned premium adjustment 14,835 16,346 Compensation related 10,935 10,041 Basis differentials–investments 2,595 — Intangibles 522 591 Operating lease liabilities 4,224 4,631 Basis differentials-foreign operations — 126 Tax credit carryforward 36,155 21,778 Net operating loss carryforward 9,244 7,682 Other 1,700 — Total gross deferred tax assets 116,662 95,650 Valuation allowance (8,581) (5,479) Total deferred tax assets, net of valuation allowance 108,081 90,171 Deferred tax liabilities Deferred policy acquisition costs (8,929) (9,889) Unpaid loss discount–transition (6,297) (7,557) Unrealized gains on investments, net (19,351) (9,753) Fixed assets (4,441) (1,263) Operating lease ROU assets (4,015) (4,439) Basis differentials–investments — (2,377) Basis differentials-foreign operations (790) — Intangibles (7,153) (10,382) Other — (124) Total deferred tax liabilities (50,976) (45,784) Net deferred tax assets (liabilities) $ 57,105 $ 44,387 |
Summary of reconciliation of unrecognized tax benefits | A reconciliation of the beginning and ending amounts of unrecognized tax benefits for 2020, 2019 and 2018, were as follows: (In thousands) 2020 2019 2018 Balance at January 1 $ 5,070 $ 3,601 $ 5,341 Increases for tax positions taken during the current year — 1,749 — Decreases for tax positions taken during the current year (4,853) — (777) Increases for tax positions taken during prior years 5,342 — — Decreases for tax positions taken during prior years — — (800) Decreases relating to a lapse of the applicable statute of limitations (360) (280) (163) Balance at December 31 $ 5,199 $ 5,070 $ 3,601 |
Summary of components of tax expense | Income tax expense (benefit) for each of the years ended December 31, 2020, 2019 and 2018 consisted of the following: (In thousands) 2020 2019 2018 Provision for income taxes: Current expense (benefit) Federal and foreign $ (19,885) $ (2,147) $ (6,509) State (296) 982 301 Total current expense (benefit) (20,181) (1,165) (6,208) Deferred expense (benefit) Federal and foreign (20,476) (27,404) (11,765) State (672) (1,239) (59) Total deferred expense (benefit) (21,148) (28,643) (11,824) Total income tax expense (benefit) $ (41,329) $ (29,808) $ (18,032) |
Summary of reconciliation of expected income tax expense to actual income tax expense | A reconciliation of “expected” income tax expense (benefit) to actual income tax expense (benefit) for each of the years ended December 31, 2020, 2019 and 2018 were as follows: (In thousands) 2020 2019 2018 Computed “expected” tax expense (benefit) $ (45,582) $ (6,049) $ 6,095 Tax-exempt income (1) (976) (1,528) (2,505) Tax credits (17,876) (21,933) (21,059) Non-U.S. operating results (1,307) (1,447) 2,269 Tax deficiency (excess tax benefit) on share-based compensation 457 99 (275) Tax rate differential on loss carryback (7,758) (3,400) — Goodwill impairment 31,413 — — Provision-to-return differences 1,217 3,595 (2,309) Change in uncertain tax positions (1,674) 1,956 (51) State income taxes (561) (376) 129 Benefit from amended returns — (550) — Other 1,318 (175) (326) Total income tax expense (benefit) $ (41,329) $ (29,808) $ (18,032) |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | The table below presents the carrying amount of goodwill and accumulated impairment losses by reporting unit at December 31, 2020: Reporting Unit (In thousands) Specialty P&C Workers' Compensation Insurance Segregated Portfolio Cell Reinsurance Total Goodwill, gross as of January 1, 2020 $ 161,115 $ 44,110 $ 5,500 $ 210,725 Accumulated impairment losses* (161,115) — — (161,115) Goodwill, net as of December 31, 2020 $ — $ 44,110 $ 5,500 $ 49,610 *Accumulated impairment losses represents the pre-tax impairment loss of $161.1 million recognized in relation to the Specialty P&C reporting unit during the third quarter of 2020 |
Reserve for Losses and Loss A_2
Reserve for Losses and Loss Adjustment Expenses (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Insurance [Abstract] | |
Schedule of reserve for losses and loss adjustment expenses | Activity in the reserve for losses and loss adjustment expenses is summarized as follows: (In thousands) 2020 2019 2018 Balance, beginning of year $ 2,346,526 $ 2,119,847 $ 2,048,381 Less reinsurance recoverables on unpaid losses and loss adjustment expenses 390,708 343,820 335,585 Net balance, beginning of year 1,955,818 1,776,027 1,712,796 Net losses: Current year (1)(2)(3) 711,846 765,698 685,326 Favorable development of reserves established in prior years, net (50,399) (11,783) (92,116) Total 661,447 753,915 593,210 Paid related to: Current year (83,204) (115,133) (117,268) Prior years (501,969) (458,991) (412,711) Total paid (585,173) (574,124) (529,979) Net balance, end of year 2,032,092 1,955,818 1,776,027 Plus reinsurance recoverables on unpaid losses and loss adjustment expenses 385,087 390,708 343,820 Balance, end of year $ 2,417,179 $ 2,346,526 $ 2,119,847 (1) Current year net losses for the year ended December 31, 2019 included incurred losses of $2.1 million related to a loss portfolio transfer entered into during 2019 in the Specialty P&C segment. Current year net losses in 2018 included incurred losses of $25.4 million related to a loss portfolio transfer entered into during the second quarter of 2018, also in the Specialty P&C segment. (2) Current year net losses for the year ended December 31, 2019 included a PDR of $9.2 million associated with the unearned premium of a large national healthcare account's claims-made policy in the Specialty P&C segment. Current year net losses for the year ended December 31, 2020 included the amortization of the aforementioned $9.2 million PDR which offsets the impact of the losses incurred associated with the premium earned related to the large national healthcare account's claims-made policy. For additional information regarding the PDR see Note 7. (3) During 2020, the aforementioned large national healthcare account did not renew on terms offered by the Company and exercised its contractual option to purchase extended reporting endorsement or "tail" coverage. As a result, ProAssurance recognized total current year losses of $60.0 million (assumes a full limit loss) within the Specialty P&C segment for the year ended December 31, 2020. |
Schedule of short-duration insurance contracts claims development | Healthcare Professional Liability Claims-Made Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR* Cumulative Number of Reported Claims 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 348,916 $ 344,808 $ 331,884 $ 305,540 $ 289,400 $ 278,258 $ 264,777 $ 254,329 $ 253,163 $ 251,440 $ (1,522) 3,530 2012 — $ 341,289 $ 324,418 $ 319,613 $ 306,956 $ 291,075 $ 279,589 $ 271,110 $ 266,629 264,932 $ (180) 3,699 2013 — — $ 315,346 $ 304,209 $ 296,550 $ 287,140 $ 272,364 $ 258,251 $ 248,594 249,477 $ (2,266) 3,770 2014 — — — $ 290,020 $ 289,397 $ 280,043 $ 267,442 $ 256,968 $ 244,607 237,091 $ (3,596) 3,316 2015 — — — — $ 276,492 $ 269,980 $ 271,138 $ 270,814 $ 256,785 256,082 $ (8,109) 3,267 2016 — — — — — $ 271,765 $ 274,643 $ 287,551 $ 293,515 287,142 $ (5,250) 3,475 2017 — — — — — — $ 283,746 $ 295,883 $ 331,304 325,919 $ (11,542) 3,719 2018 — — — — — — — $ 320,772 $ 377,908 376,111 $ (26,964) 4,150 2019 — — — — — — — — $ 377,242 374,525 $ 69,993 3,574 2020 — — — — — — — — — 326,152 $ 203,515 2,475 Total $ 2,948,871 * Includes expected development on reported claims Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 14,417 $ 71,208 $ 133,004 $ 177,089 $ 198,112 $ 214,502 $ 224,982 $ 233,103 $ 237,605 $ 242,034 2012 — $ 15,382 $ 73,571 $ 145,488 $ 190,997 $ 215,220 $ 231,652 $ 244,512 $ 250,806 256,802 2013 — — $ 16,938 $ 69,657 $ 127,496 $ 171,681 $ 197,265 $ 213,879 $ 220,402 231,930 2014 — — — $ 16,764 $ 59,485 $ 116,791 $ 154,236 $ 186,239 $ 200,392 210,534 2015 — — — — $ 9,172 $ 55,731 $ 111,741 $ 161,896 $ 195,047 218,066 2016 — — — — — $ 9,027 $ 51,869 $ 109,756 $ 164,811 203,390 2017 — — — — — — $ 16,309 $ 63,171 $ 134,787 173,183 2018 — — — — — — — $ 14,051 $ 79,291 141,609 2019 — — — — — — — — $ 17,838 66,843 2020 — — — — — — — — — 14,100 Total 1,758,491 All outstanding liabilities before 2011, net of reinsurance 16,866 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 1,207,246 Healthcare Professional Liability Occurrence Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR* Cumulative Number of Reported Claims 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 45,882 $ 44,956 $ 41,453 $ 39,917 $ 37,150 $ 35,004 $ 32,343 $ 29,784 $ 27,533 $ 27,287 $ (254) 344 2012 — $ 45,703 $ 46,513 $ 44,848 $ 40,692 $ 34,774 $ 32,691 $ 29,857 $ 25,705 26,533 $ 143 400 2013 — — $ 32,746 $ 36,602 $ 35,624 $ 34,393 $ 30,906 $ 26,919 $ 24,857 24,782 $ 74 360 2014 — — — $ 30,420 $ 29,918 $ 32,143 $ 29,869 $ 25,885 $ 22,243 22,048 $ 362 347 2015 — — — — $ 35,648 $ 35,347 $ 37,346 $ 40,960 $ 36,468 33,262 $ (1,059) 361 2016 — — — — — $ 29,609 $ 28,790 $ 27,240 $ 25,019 29,426 $ 2,174 373 2017 — — — — — — $ 24,571 $ 23,760 $ 21,148 21,498 $ 5,199 415 2018 — — — — — — — $ 38,420 $ 41,555 40,304 $ 11,413 389 2019 — — — — — — — — $ 35,420 34,093 $ 20,945 339 2020 — — — — — — — — — 92,958 $ 90,916 130 Total $ 352,191 * Includes expected development on reported claims Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 291 $ 2,803 $ 8,059 $ 16,544 $ 19,197 $ 21,416 $ 23,194 $ 24,539 $ 24,933 $ 25,111 2012 — $ 363 $ 2,430 $ 7,705 $ 12,212 $ 19,275 $ 21,435 $ 23,095 $ 23,600 24,138 2013 — — $ 369 $ 3,170 $ 7,826 $ 14,753 $ 16,787 $ 18,949 $ 21,241 21,954 2014 — — — $ 394 $ 2,260 $ 7,460 $ 10,519 $ 14,604 $ 17,024 17,708 2015 — — — — $ (350) $ 786 $ 4,854 $ 11,626 $ 15,462 22,455 2016 — — — — — $ (182) $ (195) $ 2,883 $ 10,576 17,918 2017 — — — — — — $ (6,809) $ (5,858) $ (2,765) 1,313 2018 — — — — — — — $ 65 $ 2,098 8,562 2019 — — — — — — — — $ 439 3,167 2020 — — — — — — — — — 60 Total 142,386 All outstanding liabilities before 2011, net of reinsurance 6,115 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 215,920 Medical Technology Liability Claims-Made Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR* Cumulative Number of Reported Claims 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 17,249 $ 20,930 $ 19,166 $ 15,836 $ 13,794 $ 12,487 $ 12,358 $ 8,202 $ 7,944 $ 7,725 $ 60 522 2012 — $ 11,162 $ 9,989 $ 8,906 $ 7,441 $ 5,824 $ 4,797 $ 5,051 $ 3,889 3,868 $ 51 223 2013 — — $ 9,807 $ 9,955 $ 9,536 $ 7,226 $ 4,697 $ 3,566 $ 3,504 3,305 $ 201 218 2014 — — — $ 9,989 $ 10,306 $ 9,012 $ 8,984 $ 7,679 $ 6,194 5,888 $ 396 272 2015 — — — — $ 9,376 $ 8,757 $ 7,193 $ 5,929 $ 5,081 4,664 $ 1,194 156 2016 — — — — — $ 9,200 $ 8,467 $ 7,413 $ 6,422 6,241 $ 1,374 182 2017 — — — — — — $ 11,049 $ 10,143 $ 8,306 4,919 $ 2,017 99 2018 — — — — — — — $ 10,141 $ 8,108 7,506 $ 4,595 218 2019 — — — — — — — — $ 10,072 8,324 $ 4,830 354 2020 — — — — — — — — — 11,082 $ 10,497 154 Total $ 63,522 * Includes expected development on reported claims Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 118 $ 2,034 $ 3,846 $ 5,062 $ 7,376 $ 7,240 $ 7,799 $ 7,664 $ 7,665 $ 7,665 2012 — $ 568 $ 1,520 $ 2,805 $ 3,247 $ 3,366 $ 3,676 $ 3,800 $ 3,817 3,817 2013 — — $ 102 $ 1,029 $ 1,967 $ 2,599 $ 3,092 $ 3,102 $ 3,102 3,102 2014 — — — $ 388 $ 1,527 $ 2,564 $ 3,046 $ 3,724 $ 3,776 4,074 2015 — — — — $ 25 $ 440 $ 1,625 $ 2,097 $ 2,567 2,911 2016 — — — — — $ 53 $ 1,690 $ 2,365 $ 2,959 4,295 2017 — — — — — — $ 56 $ 1,681 $ 2,017 2,360 2018 — — — — — — — $ 6 $ 191 1,850 2019 — — — — — — — — $ 584 2,552 2020 — — — — — — — — — 40 Total 32,666 All outstanding liabilities before 2011, net of reinsurance 351 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 31,207 Workers' Compensation Insurance Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR* Cumulative Number of Reported Claims 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 65,665 $ 65,783 $ 71,521 $ 72,280 $ 72,420 $ 72,495 $ 72,495 $ 72,495 $ 72,445 $ 72,445 $ 21 15,245 2012 — $ 80,285 $ 76,551 $ 75,848 $ 76,357 $ 75,836 $ 75,576 $ 75,076 $ 75,076 75,076 $ 672 16,204 2013 — — $ 86,973 $ 85,935 $ 86,928 $ 88,010 $ 87,260 $ 87,260 $ 89,760 89,560 $ 983 16,429 2014 — — — $ 93,019 $ 93,529 $ 93,029 $ 93,029 $ 93,029 $ 93,029 91,329 $ 1,594 16,210 2015 — — — — $ 100,101 $ 100,454 $ 98,454 $ 97,654 $ 96,354 93,054 $ 2,248 16,550 2016 — — — — — $ 101,348 $ 97,348 $ 92,148 $ 84,799 82,799 $ 2,149 15,978 2017 — — — — — — $ 99,874 $ 99,874 $ 99,874 97,874 $ 4,581 16,083 2018 — — — — — — — $ 118,095 $ 118,095 120,095 $ 2,054 18,009 2019 — — — — — — — — $ 119,752 119,752 $ 9,768 17,517 2020 — — — — — — — — — 106,145 $ 35,455 13,994 Total $ 948,129 * Includes expected development on reported claims Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 21,993 $ 50,900 $ 62,307 $ 67,945 $ 70,146 $ 70,934 $ 71,662 $ 71,856 $ 71,927 $ 72,013 2012 — $ 27,448 $ 56,122 $ 65,908 $ 70,558 $ 72,766 $ 73,662 $ 73,676 $ 73,768 73,851 2013 — — $ 30,554 $ 63,825 $ 76,813 $ 82,369 $ 85,689 $ 86,783 $ 87,466 87,772 2014 — — — $ 30,368 $ 65,922 $ 77,631 $ 85,022 $ 87,314 $ 87,998 88,487 2015 — — — — $ 32,078 $ 65,070 $ 78,947 $ 83,483 $ 86,528 87,884 2016 — — — — — $ 28,377 $ 58,192 $ 69,237 $ 74,886 76,954 2017 — — — — — — $ 31,586 $ 70,333 $ 82,289 87,129 2018 — — — — — — — $ 41,619 $ 86,063 104,216 2019 — — — — — — — — $ 40,994 88,008 2020 — — — — — — — — — 33,431 Total 799,745 All outstanding liabilities before 2011, net of reinsurance 3,425 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 151,809 Segregated Portfolio Cell Reinsurance - Workers' Compensation Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR* Cumulative Number of Reported Claims 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 18,790 $ 19,360 $ 19,629 $ 19,282 $ 18,644 $ 18,725 $ 18,666 $ 18,606 $ 18,522 $ 18,212 $ 27 3,154 2012 — $ 22,940 $ 21,513 $ 21,048 $ 20,028 $ 19,972 $ 19,864 $ 19,799 $ 19,727 19,602 $ 152 3,454 2013 — — $ 23,809 $ 25,310 $ 26,758 $ 26,619 $ 26,260 $ 26,033 $ 25,938 25,546 $ 104 3,723 2014 — — — $ 28,248 $ 28,423 $ 29,000 $ 28,373 $ 28,281 $ 27,919 27,482 $ 188 4,433 2015 — — — — $ 36,423 $ 32,519 $ 28,746 $ 27,548 $ 26,720 26,121 $ 372 4,949 2016 — — — — — $ 37,601 $ 34,055 $ 30,998 $ 29,424 28,437 $ 515 5,327 2017 — — — — — — $ 42,725 $ 38,594 $ 34,246 32,879 $ 775 5,706 2018 — — — — — — — $ 43,654 $ 41,283 40,017 $ 2,979 6,373 2019 — — — — — — — — $ 48,505 42,345 $ 6,461 6,081 2020 — — — — — — — — — 40,094 $ 16,479 5,587 Total $ 300,735 * Includes expected development on reported claims Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2011 $ 5,940 $ 14,045 $ 17,197 $ 17,869 $ 18,054 $ 18,177 $ 18,176 $ 18,185 $ 18,185 $ 18,185 2012 — $ 7,808 $ 14,740 $ 17,728 $ 18,474 $ 19,208 $ 19,402 $ 19,328 $ 19,311 19,340 2013 — — $ 8,131 $ 19,054 $ 24,268 $ 25,209 $ 25,366 $ 25,489 $ 25,440 25,442 2014 — — — $ 9,933 $ 21,880 $ 26,173 $ 26,810 $ 26,959 $ 27,083 27,110 2015 — — — — $ 11,257 $ 21,706 $ 23,977 $ 24,781 $ 25,033 25,125 2016 — — — — — $ 10,980 $ 23,003 $ 26,285 $ 27,162 27,211 2017 — — — — — — $ 12,404 $ 24,791 $ 28,853 31,140 2018 — — — — — — — $ 12,517 $ 27,501 33,236 2019 — — — — — — — — $ 15,100 29,604 2020 — — — — — — — — — 11,238 Total 247,631 All outstanding liabilities before 2011, net of reinsurance 600 Liabilities for losses and loss adjustment expenses, net of reinsurance $ 53,704 Syndicate 1729 Casualty Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR (1) Cumulative Number of Reported Claims (2) 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2014 $ 6,110 $ 5,812 $ 5,610 $ 5,547 $ 5,472 $ 5,432 $ 5,435 $ 333 nm 2015 — $ 14,810 $ 14,510 $ 14,398 $ 14,232 $ 14,181 14,031 $ 1,156 nm 2016 — — $ 19,535 $ 19,669 $ 19,552 $ 19,344 18,358 $ 2,511 nm 2017 — — — $ 22,069 $ 21,824 $ 21,207 23,130 $ 4,502 nm 2018 — — — — $ 18,688 $ 18,120 16,569 $ 7,181 nm 2019 — — — — — $ 15,990 16,699 $ 11,190 nm 2020 — — — — — — 15,258 $ 12,714 nm Total $ 109,480 (1) Includes expected development on reported claims (2) The abbreviation " nm " indicates that the information is not meaningful Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2014 $ 20 $ 474 $ 4,092 $ 4,214 $ 4,320 $ 4,580 $ 4,852 2015 — $ 724 $ 6,307 $ 10,313 $ 10,947 $ 11,654 12,104 2016 — — $ 2,495 $ 8,441 $ 12,869 $ 13,596 14,436 2017 — — — $ 2,611 $ 8,301 $ 12,871 14,990 2018 — — — — $ 1,852 $ 4,905 6,710 2019 — — — — — $ 1,124 2,831 2020 — — — — — — 1,982 Total 57,905 All outstanding liabilities before 2014, net of reinsurance — Liabilities for losses and loss adjustment expenses, net of reinsurance $ 51,575 Syndicate 1729 Property Insurance Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR (1) Cumulative Number of Reported Claims 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2014 $ 890 $ 1,089 $ 888 $ 864 $ 866 $ 831 $ 882 $ 8 68 2015 — $ 5,519 $ 5,917 $ 6,194 $ 6,159 $ 5,886 5,215 $ 61 538 2016 — — $ 11,896 $ 12,984 $ 12,823 $ 12,475 12,835 $ 152 1,467 2017 — — — $ 15,018 $ 17,634 $ 19,976 19,866 $ 275 2,686 2018 — — — — $ 20,636 $ 21,888 21,903 $ 307 3,612 2019 — — — — — $ 18,010 19,664 $ 983 4,122 2020 — — — — — — 18,456 $ 3,411 2,848 Total $ 98,821 (1) Includes expected development on reported claims Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2014 $ 267 $ 1,005 $ 836 $ 854 $ 857 $ 860 $ 860 2015 — $ 3,165 $ 4,022 $ 4,808 $ 4,869 $ 5,018 5,117 2016 — — $ 7,751 $ 10,939 $ 12,343 $ 12,400 12,623 2017 — — — $ 8,221 $ 16,439 $ 19,404 20,097 2018 — — — — $ 9,918 $ 17,248 19,769 2019 — — — — — $ 5,575 11,643 2020 — — — — — — 7,361 Total 77,470 All outstanding liabilities before 2014, net of reinsurance — Liabilities for losses and loss adjustment expenses, net of reinsurance $ 21,351 Syndicate 1729 Property Reinsurance Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance December 31, 2020 ($ in thousands) Year Ended December 31, IBNR (1) Cumulative Number of Reported Claims (2) 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2014 $ 831 $ 929 $ 989 $ 989 $ 1,125 $ 1,120 $ 1,112 $ — nm 2015 — $ 2,788 $ 2,825 $ 2,275 $ 2,328 $ 2,377 2,455 $ 59 nm 2016 — — $ 4,497 $ 4,050 $ 3,368 $ 2,832 2,498 $ 98 nm 2017 — — — $ 6,861 $ 7,832 $ 6,868 7,947 $ 44 nm 2018 — — — — $ 8,840 $ 6,398 2,887 $ 590 nm 2019 — — — — — $ 10,977 13,333 $ 1,704 nm 2020 — — — — — — 8,400 $ 3,032 nm Total $ 38,632 (1) Includes expected development on reported claims (2) The abbreviation " nm " indicates that the information is not meaningful Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (In thousands) Year Ended December 31, 2014 2015 2016 2017 2018 2019 2020 Accident Year Unaudited 2014 $ 79 $ 917 $ 984 $ 984 $ 1,125 $ 1,120 $ 1,112 2015 — $ 1,313 $ 1,804 $ 1,996 $ 2,234 $ 2,267 2,303 2016 — — $ 613 $ 1,667 $ 2,136 $ 2,192 2,215 2017 — — — $ 4,147 $ 7,300 $ 8,947 7,563 2018 — — — — $ 547 $ 1,644 1,663 2019 — — — — — $ 4,974 8,575 2020 — — — — — — 3,931 Total 27,362 All outstanding liabilities before 2014, net of reinsurance — Liabilities for losses and loss adjustment expenses, net of reinsurance $ 11,270 |
Schedule of historical claims duration | Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance Years 1 2 3 4 5 6 7 8 9 10 Unaudited Healthcare Professional Liability Claims-Made 5.0% 18.0% 22.5% 17.0% 11.3% 6.9% 4.0% 3.4% 2.0% 1.8% Healthcare Professional Liability Occurrence (2.6%) 6.4% 16.8% 22.2% 16.6% 11.4% 6.3% 3.2% 1.7% 0.7% Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance Years 1 2 3 4 5 6 7 8 9 10 Unaudited Medical Technology Liability 3.6 % 21.2 % 21.0 % 11.6 % 15.2 % 3.0 % 3.9 % (0.4 %) — % — % Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance Years 1 2 3 4 5 6 7 8 9 10 Unaudited Workers' Compensation Insurance 33.6 % 37.9 % 14.0 % 6.4 % 3.0 % 1.1 % 0.6 % 0.2 % 0.1 % 0.1 % Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance Years 1 2 3 4 5 6 7 8 9 10 Unaudited Segregated Portfolio Cell Reinsurance - workers' compensation 35.5 % 39.8 % 14.4 % 3.8 % 1.2 % 0.6 % (0.1 %) — % 0.1 % — % Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance Years 1 2 3 4 5 6 7 8 9 10 Unaudited Syndicate 1729 Casualty 3.2 % 17.5 % 24.5 % 18.4 % 11.9 % 8.5 % 5.8 % 3.7 % 2.0 % 0.3 % Syndicate 1729 Property Insurance 33.5 % 58.9 % 7.7 % — % — % — % — % — % — % — % Syndicate 1729 Property Reinsurance 37.8 % 49.1 % 13.0 % 0.1 % — % — % — % — % — % — % |
Schedule of reconciliation of claims development to liability | Below is a reconciliation of the claims development information to the Consolidated Balance Sheet: (In thousands) December 31, 2020 Net outstanding liabilities Healthcare Professional Liability claims-made $ 1,207,246 Healthcare Professional Liability occurrence 215,920 Medical Technology Liability claims-made 31,207 Workers' Compensation Insurance 151,809 Segregated Portfolio Cell Reinsurance - workers' compensation 53,704 Syndicate 1729 casualty 51,575 Syndicate 1729 property insurance 21,351 Syndicate 1729 property reinsurance 11,270 Other short-duration lines 94,621 Liabilities for losses and loss adjustment expenses, net of reinsurance 1,838,703 Reinsurance recoverable on unpaid losses Healthcare Professional Liability claims-made 190,378 Healthcare Professional Liability occurrence 43,241 Medical Technology Liability claims-made 30,701 Workers' Compensation Insurance 50,809 Segregated Portfolio Cell Reinsurance - Workers' Compensation 25,182 Syndicate 1729 casualty 6,902 Syndicate 1729 property insurance 9,344 Syndicate 1729 property reinsurance 8,689 Other short-duration lines 19,841 Total reinsurance recoverable on unpaid losses and loss adjustment expenses 385,087 Reserve for the future utilization of the DDR benefit 74,200 Unallocated loss adjustment expenses 111,827 Loss portfolio transfers (1) 7,883 Other (521) 193,389 Gross liability for losses and loss adjustment expenses $ 2,417,179 (1) Represents the reserve for retroactive coverages, net of any applicable deferred gains, related to the loss portfolio transfers entered into during 2019 and 2018. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Schedule of lease cost | The following table provides a summary of the components of net lease expense as well as the reporting location in the Consolidated Statements of Income and Comprehensive Income for the years ended December 31, 2020 and 2019. (In thousands) Location in the Consolidated Statements of Income and Comprehensive Income Year Ended December 31 2020 2019 Operating lease expense (1) Operating expense $ 4,355 $ 4,485 Sublease income (2) Other income (143) (152) Net lease expense $ 4,212 $ 4,333 (1) Includes short-term lease costs and variable lease costs, if applicable. For the years ended December 31, 2020 and 2019, no short-term lease costs were recognized and variable lease costs were nominal in amount. (2) Sublease income excludes rental income from owned properties of $2.5 million during each of the years ended December 31, 2020 and 2019, which is included in other income. See “Item 2. Properties” for a listing of currently owned properties. The following table provides supplemental lease information for operating leases on the Consolidated Balance Sheet as of December 31, 2020 and December 31, 2019. Year Ended December 31 ($ in thousands) 2020 2019 Operating lease ROU assets $ 19,013 $ 21,074 Operating lease liabilities $ 20,116 $ 22,051 Weighted-average remaining lease term 8.31 years 8.74 years Weighted-average discount rate 2.97 % 3.08 % The following table provides supplemental lease information for the Consolidated Statements of Cash Flows for the years ended December 31, 2020 and 2019. Year Ended December 31 (In thousands) 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 127 $ 976 |
Schedule of lease liability | The following table is a schedule of remaining future minimum lease payments for operating leases that had an initial or remaining non-cancellable lease term in excess of one year as of December 31, 2020. (In thousands) 2021 $ 4,145 2022 3,306 2023 2,608 2024 2,026 2025 1,783 Thereafter 8,875 Total future minimum lease payments 22,743 Less: Imputed interest 2,627 Total operating lease liabilities $ 20,116 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Outstanding long-term debt | ProAssurance’s outstanding debt consisted of the following: (In thousands) December 31, December 31, Senior Notes due 2023, unsecured, interest at 5.3% annually $ 250,000 $ 250,000 Mortgage Loans, outstanding borrowings are secured by first priority liens on two office buildings, and bear an interest rate of three-month LIBOR plus 1.325% (1.58% and 3.21%, respectively) determined on a quarterly basis. 36,113 37,617 Total principal 286,113 287,617 Less unamortized debt issuance costs 1,400 1,796 Debt less unamortized debt issuance costs $ 284,713 $ 285,821 |
Schedule of debt maturities | At December 31, 2020, contractual maturities of the Mortgages Loans for each of the next five years, excluding interest payments, are as follows: (In thousands) Principal Payments Due by Period 2021 $ 1,559 2022 1,617 2023 1,677 2024 1,740 2025 1,805 Thereafter 27,715 Total principal payments $ 36,113 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Schedule of common stock outstanding | The following is a summary of changes in common shares issued and outstanding during the years ended December 31, 2020, 2019 and 2018: (In thousands) 2020 2019 2018 Issued and outstanding shares - January 1 53,792 53,637 53,457 Shares issued due to vesting of share-based compensation awards 54 132 135 Other shares issued for compensation and shares reissued to stock purchase plan * 47 23 45 Issued and outstanding shares - December 31 53,893 53,792 53,637 * Shares issued were valued at fair value (the market price of a ProAssurance common share on the date of issue). |
Schedule of dividends declared | ProAssurance declared cash dividends during 2020, 2019 and 2018 as follows: Cash Dividends Declared, per Share 2020 2019 2018 First Quarter $ 0.31 $ 0.31 $ 0.31 Second Quarter $ 0.05 $ 0.31 $ 0.31 Third Quarter $ 0.05 $ 0.31 $ 0.31 Fourth Quarter $ 0.05 $ 0.31 $ 0.31 Fourth Quarter - Special dividend $ — $ — $ 0.50 |
Schedule of reclassification adjustments related to available-for-sale securities | For the years ended December 31, 2020 and 2019, OCI included a deferred tax expense of $9.6 million and $14.2 million, respectively, and a deferred tax benefit of $9.6 million for the year ended December 31, 2018. The changes in the balance of each component of AOCI for the years ended December 31, 2020, 2019 and 2018 were as follows: (In thousands) Unrealized Investment Gains (Losses) Non-credit Impairments Unrecognized Change in Defined Benefit Plan Liabilities (1) Accumulated Other Comprehensive Income (Loss) Balance December 31, 2019 $ 37,333 $ (300) $ (78) $ 36,955 OCI, before reclassifications, net of tax 46,383 (187) (26) 46,170 Amounts reclassified from AOCI, net of tax (8,328) 430 — (7,898) Net OCI, current period 38,055 243 (26) 38,272 Balance December 31, 2020 $ 75,388 $ (57) $ (104) $ 75,227 (In thousands) Unrealized Investment Gains (Losses) Non-credit Impairments Unrecognized Change in Defined Benefit Plan Liabilities (1) Accumulated Other Comprehensive Income (Loss) Balance December 31, 2018 $ (16,733) $ (121) $ (57) $ (16,911) OCI, before reclassifications, net of tax 56,041 (179) (21) 55,841 Amounts reclassified from AOCI, net of tax (1,975) — — (1,975) Net OCI, current period 54,066 (179) (21) 53,866 Balance December 31, 2019 $ 37,333 $ (300) $ (78) $ 36,955 (In thousands) Unrealized Investment Gains (Losses) Non-credit Impairments Unrecognized Change in Defined Benefit Plan Liabilities (1) Accumulated Other Comprehensive Income (Loss) Balance December 31, 2017 $ 15,453 $ (503) $ (39) $ 14,911 Cumulative-effect adjustment (2) 3,524 (108) — 3,416 OCI, before reclassifications, net of tax (35,494) — (18) (35,512) Amounts reclassified from AOCI, net of tax (216) 490 — 274 Net OCI, current period (35,710) 490 (18) (35,238) Balance December 31, 2018 $ (16,733) $ (121) $ (57) $ (16,911) (1) Represents the reestimation of the defined benefit plan liability assumed in the Eastern acquisition. The defined benefit plan is frozen as to the earnings of additional benefits and the benefit plan liability is reestimated annually. (2) Due to the adoption of ASU 2018-02, ProAssurance recorded a cumulative-effect adjustment as of January 1, 2018 which increased beginning AOCI and decreased retained earnings in order to reclassify stranded tax effects that resulted from the change in enacted federal corporate tax rate from 35% to 21% as a result of the TCJA. |
Share-Based Payments (Tables)
Share-Based Payments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Summary of compensation expense and related tax benefit recognized during each period, and compensation cost expense in future periods | The following table provides a summary of compensation expense and the total related tax benefit recognized during each period as well as estimated compensation cost that will be charged to expense in future periods. Share-Based Unrecognized Compensation Cost Year Ended December 31 December 31, 2020 ($ in millions, except remaining recognition period) 2020 2019 2018 Amount Weighted Average Remaining Total share-based compensation expense $ 3.8 $ 3.5 $ 5.3 $ 4.7 2.1 Tax benefit recognized $ 0.8 $ 0.7 $ 1.1 |
Summary of activity related to management share awards | Activity for restricted share units during 2020, 2019 and 2018 is summarized below. Grant date fair values are based on the market value of a share of ProAssurance common stock on the date of grant less the estimated net present value of expected dividends during the vesting period. 2020 2019 2018 Units Weighted Units Weighted Units Weighted Beginning non-vested balance 320,625 $ 43.99 267,323 $ 49.16 269,520 $ 48.63 Granted 111,758 $ 29.18 164,196 $ 36.96 85,797 $ 44.73 Forfeited (9,054) $ 40.13 (3,832) $ 45.09 (3,878) $ 50.07 Vested and released (83,525) $ 56.74 (107,062) $ 46.06 (84,116) $ 42.90 Ending non-vested balance 339,804 $ 36.09 320,625 $ 43.99 267,323 $ 49.16 |
Summary of activity for performance share awards | The table reflects the base number of units; actual awards that vest depend upon the extent to which performance objectives are achieved. Grant date fair values are based on the market value of a share of ProAssurance common stock on the date of grant less the estimated net present value of expected dividends during the vesting period. 2020 2019 2018 Base Units Weighted Base Units Weighted Base Units Weighted Beginning non-vested balance 100,370 $ 50.10 135,202 $ 49.95 212,105 $ 47.11 Granted 38,609 $ 29.18 25,168 $ 40.18 27,202 $ 44.73 Forfeited — $ — — $ — — $ — Expired* (48,000) $ 58.35 — $ — — $ — Vested and released — $ — (60,000) $ 45.59 (104,105) $ 42.79 Ending non-vested balance 90,979 $ 36.87 100,370 $ 50.10 135,202 $ 49.95 *Represents performance share units that did not vest as minimum performance objectives were not achieved. |
Summary of market value of ProAssurance common share on the grant date fair value | Purchase match unit activity during 2019 and 2018 is summarized below. Grant date fair values are based on the market value of a ProAssurance common share on the date of grant less the estimated net present value of expected dividends during the vesting period. 2020 2019 2018 Units Weighted Units Weighted Units Weighted Beginning non-vested balance — $ — 44,682 $ 51.05 70,292 $ 49.40 Granted — $ — — $ — — $ — Forfeited — $ — (1,400) $ 51.47 (1,594) $ 50.19 Vested and released — $ — (43,282) $ 51.03 (24,016) $ 46.28 Ending non-vested balance — $ — — $ — 44,682 $ 51.05 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share, basic and diluted | The following table provides a reconciliation between the Company's basic weighted average number of common shares outstanding to its diluted weighted average number of common shares outstanding: (In thousands, except per share data) Year Ended December 31 2020 2019 2018 Weighted average number of common shares outstanding, basic 53,863 53,740 53,598 Dilutive effect of securities: Restricted Share Units 42 75 70 Performance Share Units 1 10 63 Purchase Match Units — 16 18 Weighted average number of common shares outstanding, diluted 53,906 53,841 53,749 Effect of dilutive shares on earnings (loss) per share $ — $ — $ — |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information | The tabular information that follows shows the financial results of the Company's reportable segments reconciled to results reflected in the Consolidated Statements of Income and Comprehensive Income. ProAssurance does not consider asset impairments, including goodwill and intangible asset impairments, in assessing the financial performance of its operating and reportable segments, and thus are included in the reconciliation of segment results to consolidated results. Financial results by segment were as follows: Year Ended December 31, 2020 (In thousands) Specialty P&C Workers' Compensation Insurance Segregated Portfolio Cell Reinsurance Lloyd's Syndicates Corporate Inter-segment Eliminations Consolidated Net premiums earned $ 477,365 $ 171,772 $ 66,352 $ 77,226 $ — $ — $ 792,715 Net investment income — — 1,084 4,128 66,786 — 71,998 Equity in earnings (loss) of unconsolidated subsidiaries — — — — (11,921) — (11,921) Net realized gains (losses) — — 3,085 988 11,605 — 15,678 Other income (expense) (1) 3,908 2,216 205 51 2,531 (2,441) 6,470 Net losses and loss adjustment expenses (470,074) (111,552) (29,605) (50,216) — — (661,447) Underwriting, policy acquisition and operating expenses (1) (109,599) (56,449) (20,709) (30,136) (23,429) 2,441 (237,881) SPC U.S. federal income tax expense (2) — — (1,746) — — — (1,746) SPC dividend (expense) income — — (14,304) — — — (14,304) Interest expense — — — — (15,503) — (15,503) Income tax benefit (expense) — — — 29 41,300 — 41,329 Segment results $ (98,400) $ 5,987 $ 4,362 $ 2,070 $ 71,369 $ — $ (14,612) Reconciliation of segments to consolidated results: Goodwill impairment (161,115) Net income (loss) $ (175,727) Significant non-cash items: Goodwill impairment $ — $ — $ — $ — $ — $ — $ 161,115 Depreciation and amortization, net of accretion $ 7,747 $ 3,690 $ 676 $ (4) $ 9,266 $ — $ 21,375 Year Ended December 31, 2019 (In thousands) Specialty P&C Workers' Compensation Insurance Segregated Portfolio Cell Reinsurance Lloyd's Syndicates Corporate Inter-segment Eliminations Consolidated Net premiums earned $ 499,058 $ 189,240 $ 78,563 $ 80,671 $ — $ — $ 847,532 Net investment income — — 1,578 4,551 87,140 — 93,269 Equity in earnings (loss) of unconsolidated subsidiaries — — — — (10,061) — (10,061) Net realized gains (losses) — — 4,020 768 55,086 — 59,874 Other income (expense) (1) 5,796 2,399 559 (573) 3,478 (2,439) 9,220 Net losses and loss adjustment expenses (532,485) (121,649) (52,412) (47,369) — — (753,915) Underwriting, policy acquisition and operating expenses (1)(3) (120,310) (57,520) (23,201) (34,711) (19,146) 2,439 (252,449) SPC U.S. federal income tax expense (2)(3) — — (1,059) — — — (1,059) SPC dividend (expense) income — — (4,579) — — — (4,579) Interest expense — — — — (16,636) — (16,636) Income tax benefit (expense) — — — — 29,808 — 29,808 Segment results $ (147,941) $ 12,470 $ 3,469 $ 3,337 $ 129,669 $ — $ 1,004 Net income (loss) $ 1,004 Significant non-cash items: Depreciation and amortization, net of accretion $ 6,586 $ 3,825 $ (41) $ (7) $ 8,302 $ — $ 18,665 Year Ended December 31, 2018 (In thousands) Specialty P&C Workers' Compensation Insurance Segregated Portfolio Cell Reinsurance Lloyd's Syndicates Corporate Inter-segment Eliminations Consolidated Net premiums earned $ 491,787 $ 186,079 $ 73,940 $ 67,047 $ — $ — $ 818,853 Net investment income — — 1,566 3,358 86,960 — 91,884 Equity in earnings (loss) of unconsolidated subsidiaries — — — — 8,948 — 8,948 Net realized gains (losses) — — (3,149) (460) (39,879) — (43,488) Other income (expense) (1) 5,844 2,412 211 322 3,525 (2,481) 9,833 Net losses and loss adjustment expenses (384,431) (118,483) (38,726) (51,570) — — (593,210) Underwriting, policy acquisition and operating expenses (1)(3) (112,419) (55,693) (22,060) (31,686) (18,767) 2,435 (238,190) SPC U.S. federal income tax expense (2)(3) — — (366) — — — (366) SPC dividend (expense) income — — (9,122) — — — (9,122) Interest expense — — — — (16,163) 46 (16,117) Income tax benefit (expense) — — — 317 17,715 — 18,032 Segment results $ 781 $ 14,315 $ 2,294 $ (12,672) $ 42,339 $ — $ 47,057 Net income (loss) $ 47,057 Significant non-cash items: Depreciation and amortization, net of accretion $ 7,050 $ 3,850 $ 441 $ (8) $ 9,922 $ — $ 21,255 (1) Certain fees for services provided to the SPCs at Inova Re and Eastern Re are recorded as expenses within the Segregated Portfolio Cell Reinsurance segment and as other income within the Workers' Compensation Insurance segment. These fees are primarily SPC rental fees and are eliminated between segments in consolidation. (2) Represents the provision for U.S. federal income taxes for SPCs at Inova Re, which have elected to be taxed as a U.S. corporation under Section 953(d) of the Internal Revenue Code. U.S. federal income taxes are included in the total SPC net results and are paid by the individual SPCs. (3) In ProAssurance's December 31, 2019 and 2018 reports on Form 10-K, underwriting, policy acquisition and operating expenses for the years ended December 31, 2019 and 2018 included a provision for U.S. federal income taxes of $1.1 million and $0.4 million, respectively, for SPCs at Inova Re that have elected to be taxed as U.S. taxpayers (see footnote 2). Beginning in 2020, this tax provision is now presented as a separate line item on the Consolidated Statements of Income and Comprehensive Income as SPC U.S. federal income tax expense. To conform to the current year presentation, ProAssurance has recast underwriting, policy acquisition and operating expenses for the years ended December 31, 2019 and 2018. |
Schedule of product and service revenue from external customers | The following table provides detailed information regarding ProAssurance's gross premiums earned by product as well as a reconciliation to net premiums earned. All gross premiums earned are from external customers except as noted. ProAssurance's insured risks are primarily within the U.S. Year Ended December 31 (In thousands) 2020 2019 2018 Specialty P&C Segment Gross premiums earned: HCPL $ 411,716 $ 434,867 $ 433,193 Small business unit 104,376 109,876 111,204 Medical technology liability 34,909 33,957 35,157 Other 821 2,096 468 Ceded premiums earned (74,457) (81,738) (88,235) Segment net premiums earned 477,365 499,058 491,787 Workers' Compensation Insurance Segment Gross premiums earned: Traditional business 184,204 203,195 199,466 Alternative market business 71,280 84,214 83,508 Ceded premiums earned (83,712) (98,169) (96,895) Segment net premiums earned 171,772 189,240 186,079 Segregated Portfolio Cell Reinsurance Segment Gross premiums earned: Workers' compensation (1) 68,518 81,765 78,255 HCPL (2) 6,594 6,059 5,009 Other — 480 — Ceded premiums earned (8,760) (9,741) (9,324) Segment net premiums earned 66,352 78,563 73,940 Lloyd's Syndicates Segment Gross premiums earned: Property and casualty (3) 98,990 101,222 83,307 Ceded premiums earned (21,764) (20,551) (16,260) Segment net premiums earned 77,226 80,671 67,047 Consolidated net premiums earned $ 792,715 $ 847,532 $ 818,853 (1) Premium for all periods is assumed from the Workers' Compensation Insurance segment. (2) Premium for all periods is assumed from the Specialty P&C segment. (3) Includes a nominal amount of premium assumed from the Specialty P&C segment for the year ended December 31, 2019 and $5.0 million for year ended December 31, 2018. |
Statutory Accounting and Divi_2
Statutory Accounting and Dividend Restrictions (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Insurance [Abstract] | |
Net income (loss) and capital surplus | Net income (loss) and capital and surplus of ProAssurance’s insurance subsidiaries on a statutory basis are shown in the following table. (In millions) Statutory Net Income (Loss) Statutory Capital and Surplus 2020 2019 2018 2020 2019 $81 ($22) $135 $831 $878 |
Accounting Policies - Narrative
Accounting Policies - Narrative (Details) | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2020USD ($) | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($)segment | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Jan. 01, 2020USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Number of reportable segments | segment | 5 | |||||
SPC U.S. federal income tax expense | $ 1,746,000 | $ 1,059,000 | $ 366,000 | |||
Insurance policy duration (years) | 1 year | |||||
Net of related allowance for expected credit losses | $ 6,131,000 | $ 6,131,000 | 1,590,000 | |||
Earned but unbilled premiums | 3,000,000 | $ 3,000,000 | 4,300,000 | |||
Minimum period for claims resolution (years) | 5 years | |||||
Leases classified as financing leases | 0 | $ 0 | ||||
Goodwill impairment | 0 | $ 161,100,000 | 161,115,000 | 0 | 0 | |
Retained earnings (accumulated deficit) | $ 1,301,163,000 | $ 1,301,163,000 | 1,505,738,000 | |||
Percent of investments with exposure to LIBOR | 600.00% | 600.00% | ||||
Investments with exposure to LIBOR | $ 191,000,000 | $ 191,000,000 | ||||
Investments with exposure to LIBOR, issued in 2020 or 2019 | 34.00% | 34.00% | ||||
Building and Building Improvements | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Real estate accumulated depreciation | $ 26,500,000 | $ 26,500,000 | 25,700,000 | |||
Depreciation | $ 900,000 | 1,000,000 | $ 1,200,000 | |||
Cumulative Effect, Period of Adoption, Adjustment | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Net of related allowance for expected credit losses | $ 5,160,000 | |||||
Retained earnings (accumulated deficit) | $ (4,100,000) |
Accounting Policies (Premium Re
Accounting Policies (Premium Receivable Expected Credit Losses) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Premiums Receivable, Net | $ 201,395 | $ 249,540 |
Premium Receivable, Allowance for Credit Loss [Roll Forward] | ||
Premium receivable, allowance for credit loss, beginning balance | 1,590 | |
Provision for expected credit losses | 827 | |
Write offs charged against the allowance | (2,019) | |
Recoveries of amounts previously written off | 573 | |
Premium receivable, allowance for credit loss, ending balance | 6,131 | |
Cumulative Effect, Period of Adoption, Adjustment | ||
Premium Receivable, Allowance for Credit Loss [Roll Forward] | ||
Premium receivable, allowance for credit loss, beginning balance | $ 5,160 |
Accounting Policies - Intangibl
Accounting Policies - Intangible Assets (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | |||
Gross carrying value non-amortizable | $ 25.8 | $ 25.8 | |
Gross carrying value amortizable | 98.8 | 97.7 | |
Total Intangible Assets | 124.6 | 123.5 | |
Accumulated amortization of intangible assets | 58.9 | 52.7 | |
Amortization expense of intangible assets | $ 6.2 | 6.2 | $ 6.1 |
Estimated aggregate amortization of intangible assets for 2021 | 6.2 | ||
Estimated aggregate amortization of intangible assets for 2022 | 6.2 | ||
Estimated aggregate amortization of intangible assets for 2023 | 6.2 | ||
Estimated aggregate amortization of intangible assets for 2024 | 5.9 | ||
Estimated aggregate amortization of intangible assets for 2025 | $ 5.6 |
Accounting Policies - Other Lia
Accounting Policies - Other Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Accounting Policies [Abstract] | |||
SPC dividends payable | $ 68,865 | $ 55,763 | |
Unpaid shareholder dividends | 2,694 | 16,676 | $ 43,446 |
All other | 110,480 | 100,817 | |
Total other liabilities | $ 182,039 | $ 173,256 |
Fair Value Measurement - Assets
Fair Value Measurement - Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Assets: | ||
Fixed maturities available for sale, at fair value | $ 2,457,531 | $ 2,288,785 |
Fixed maturities, trading | 48,456 | 47,284 |
Equity investments | 120,101 | 250,552 |
Recurring fair value measurements | ||
Assets: | ||
Fixed maturities, trading | 48,456 | |
Other assets | 329 | 760 |
Total assets categorized within the fair value hierarchy | 2,995,798 | 2,940,829 |
Total assets at fair value | 3,242,057 | 3,233,830 |
Recurring fair value measurements | Level 1 | ||
Assets: | ||
Fixed maturities, trading | 0 | 0 |
Other assets | 0 | 0 |
Total assets categorized within the fair value hierarchy | 416,757 | 545,607 |
Recurring fair value measurements | Level 2 | ||
Assets: | ||
Fixed maturities, trading | 48,456 | 47,284 |
Other assets | 329 | 760 |
Total assets categorized within the fair value hierarchy | 2,567,083 | 2,384,065 |
Recurring fair value measurements | Level 3 | ||
Assets: | ||
Fixed maturities, trading | 0 | 0 |
Other assets | 0 | 0 |
Total assets categorized within the fair value hierarchy | 11,958 | 11,157 |
U.S. Treasury obligations | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 107,059 | 110,467 |
U.S. Treasury obligations | Recurring fair value measurements | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 107,059 | 110,467 |
U.S. Treasury obligations | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
U.S. Treasury obligations | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 107,059 | 110,467 |
U.S. Treasury obligations | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
U.S. Government-sponsored enterprise obligations | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 12,261 | 17,340 |
U.S. Government-sponsored enterprise obligations | Recurring fair value measurements | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 12,261 | 17,340 |
U.S. Government-sponsored enterprise obligations | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
U.S. Government-sponsored enterprise obligations | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 12,261 | 17,340 |
U.S. Government-sponsored enterprise obligations | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
State and municipal bonds | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 332,920 | 296,093 |
State and municipal bonds | Recurring fair value measurements | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 332,920 | 296,093 |
State and municipal bonds | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
State and municipal bonds | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 332,920 | 296,093 |
State and municipal bonds | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
Corporate debt, multiple observable inputs | Recurring fair value measurements | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 1,326,077 | 1,335,285 |
Corporate debt, multiple observable inputs | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
Corporate debt, multiple observable inputs | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 1,326,077 | 1,335,285 |
Corporate debt, multiple observable inputs | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
Corporate debt, limited observable inputs | Level 3 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 3,265 | 5,079 |
Corporate debt, limited observable inputs | Recurring fair value measurements | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 3,265 | 5,079 |
Corporate debt, limited observable inputs | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
Corporate debt, limited observable inputs | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
Corporate debt, limited observable inputs | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 3,265 | 5,079 |
Residential mortgage-backed securities | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 276,541 | 208,408 |
Residential mortgage-backed securities | Recurring fair value measurements | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 276,541 | 208,408 |
Residential mortgage-backed securities | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
Residential mortgage-backed securities | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 274,509 | 208,408 |
Residential mortgage-backed securities | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 2,032 | 0 |
Agency commercial mortgage-backed securities | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 13,310 | 8,221 |
Agency commercial mortgage-backed securities | Recurring fair value measurements | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 13,310 | 8,221 |
Agency commercial mortgage-backed securities | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
Agency commercial mortgage-backed securities | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 13,310 | 8,221 |
Agency commercial mortgage-backed securities | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
Other commercial mortgage-backed securities | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 113,092 | 71,868 |
Other commercial mortgage-backed securities | Recurring fair value measurements | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 113,092 | 71,868 |
Other commercial mortgage-backed securities | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
Other commercial mortgage-backed securities | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 113,092 | 71,868 |
Other commercial mortgage-backed securities | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
Other asset-backed securities | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 273,006 | 236,024 |
Other asset-backed securities | Recurring fair value measurements | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 273,006 | 236,024 |
Fixed maturities, trading | 47,284 | |
Other asset-backed securities | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 0 | 0 |
Other asset-backed securities | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 266,345 | 233,032 |
Other asset-backed securities | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Fixed maturities available for sale, at fair value | 6,661 | 2,992 |
Financial | Recurring fair value measurements | ||
Assets: | ||
Equity investments | 13,810 | 40,294 |
Financial | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Equity investments | 13,810 | 40,294 |
Financial | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Equity investments | 0 | 0 |
Financial | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Equity investments | 0 | 0 |
Utilities/Energy | Recurring fair value measurements | ||
Assets: | ||
Equity investments | 564 | 21,195 |
Utilities/Energy | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Equity investments | 564 | 21,195 |
Utilities/Energy | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Equity investments | 0 | 0 |
Utilities/Energy | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Equity investments | 0 | 0 |
Consumer oriented | Recurring fair value measurements | ||
Assets: | ||
Equity investments | 1,262 | 29,288 |
Consumer oriented | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Equity investments | 1,262 | 29,288 |
Consumer oriented | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Equity investments | 0 | 0 |
Consumer oriented | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Equity investments | 0 | 0 |
Industrial | Recurring fair value measurements | ||
Assets: | ||
Equity investments | 2,240 | 26,440 |
Industrial | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Equity investments | 2,240 | 26,440 |
Industrial | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Equity investments | 0 | 0 |
Industrial | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Equity investments | 0 | 0 |
Bond funds | Recurring fair value measurements | ||
Assets: | ||
Equity investments | 69,475 | 58,346 |
Bond funds | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Equity investments | 69,475 | 58,346 |
Bond funds | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Equity investments | 0 | 0 |
Bond funds | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Equity investments | 0 | 0 |
All other | Recurring fair value measurements | ||
Assets: | ||
Equity investments | 20,202 | 52,512 |
All other | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Equity investments | 20,202 | 52,512 |
All other | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Equity investments | 0 | 0 |
All other | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Equity investments | 0 | 0 |
Short-term investments | Recurring fair value measurements | ||
Assets: | ||
Short-term investments | 337,813 | 339,907 |
Short-term investments | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Short-term investments | 307,695 | 317,313 |
Short-term investments | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Short-term investments | 30,118 | 22,594 |
Short-term investments | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Short-term investments | 0 | 0 |
Other investments | Level 3 | ||
Assets: | ||
Total assets categorized within the fair value hierarchy | 0 | 3,086 |
Other investments | Recurring fair value measurements | ||
Assets: | ||
Short-term investments | 44,116 | 36,018 |
Other investments | Recurring fair value measurements | Level 1 | ||
Assets: | ||
Short-term investments | 1,509 | 219 |
Other investments | Recurring fair value measurements | Level 2 | ||
Assets: | ||
Short-term investments | 42,607 | 32,713 |
Other investments | Recurring fair value measurements | Level 3 | ||
Assets: | ||
Short-term investments | 0 | 3,086 |
Equity investments | Equity investments | Recurring fair value measurements | Fair Value Measured at Net Asset Value Per Share | ||
Assets: | ||
Total assets categorized within the fair value hierarchy | 12,548 | 22,477 |
Investment in unconsolidated subsidiaries | Equity investments | Recurring fair value measurements | Fair Value Measured at Net Asset Value Per Share | ||
Assets: | ||
Total assets categorized within the fair value hierarchy | $ 233,711 | $ 270,524 |
Fair Value Measurement - Narrat
Fair Value Measurement - Narrative (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Goodwill | $ 49,610,000 | $ 161,100,000 | $ 49,610,000 | $ 210,725,000 | |
Goodwill impairment | 0 | $ 161,100,000 | 161,115,000 | 0 | $ 0 |
Deferred compensation plan assets | 30,600,000 | $ 30,600,000 | $ 26,900,000 | ||
Mortgage Loans | Three month LIBOR | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Basis spread on variable rate for debt | 1.325% | ||||
Interest Rate Cap | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Premium paid on derivative for right to receive cash payments | $ 2,000,000 | $ 2,000,000 | |||
Floor interest rate on derivative | 2.35% | 2.35% | |||
Interest Rate Cap | Other assets | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Notional Amount | $ 35,000,000 | $ 35,000,000 | |||
Corporate debt, limited observable inputs | Rating BBplus | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Credit rating | 100.00% | ||||
Corporate debt, limited observable inputs | Rating BBBminus | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Credit rating | 66.00% | ||||
Other asset-backed securities | Rating AA minus | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Credit rating | 51.00% | ||||
Other asset-backed securities | Rating AA | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Credit rating | 100.00% |
Fair Value Measurement - Quanti
Fair Value Measurement - Quantitative Information Regarding Level 3 Valuations (Details) $ in Thousands | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
Assets: | ||
Fixed maturities available for sale, at fair value | $ 2,457,531 | $ 2,288,785 |
Fair Value, Inputs, Level 3 | Corporate debt, limited observable inputs | ||
Assets: | ||
Fixed maturities available for sale, at fair value | $ 3,265 | 5,079 |
Fair Value, Inputs, Level 3 | Corporate debt, limited observable inputs | Market Comparable Securities | Comparability Adjustment | Minimum | ||
Assets: | ||
Assets measured at fair value | 0 | |
Fair Value, Inputs, Level 3 | Corporate debt, limited observable inputs | Market Comparable Securities | Comparability Adjustment | Maximum | ||
Assets: | ||
Assets measured at fair value | 0.05 | |
Fair Value, Inputs, Level 3 | Corporate debt, limited observable inputs | Market Comparable Securities | Comparability Adjustment | Weighted Average | ||
Assets: | ||
Assets measured at fair value | 0.025 | |
Fair Value, Inputs, Level 3 | Corporate debt, limited observable inputs | Discounted Cash Flows | Comparability Adjustment | Minimum | ||
Assets: | ||
Assets measured at fair value | 0 | |
Fair Value, Inputs, Level 3 | Corporate debt, limited observable inputs | Discounted Cash Flows | Comparability Adjustment | Maximum | ||
Assets: | ||
Assets measured at fair value | 0.05 | |
Fair Value, Inputs, Level 3 | Corporate debt, limited observable inputs | Discounted Cash Flows | Comparability Adjustment | Weighted Average | ||
Assets: | ||
Assets measured at fair value | 0.025 | |
Fair Value, Inputs, Level 3 | Residential mortgage-backed securities | ||
Assets: | ||
Fixed maturities available for sale, at fair value | $ 2,032 | 0 |
Fair Value, Inputs, Level 3 | Residential mortgage-backed securities | Market Comparable Securities | Comparability Adjustment | Minimum | ||
Assets: | ||
Assets measured at fair value | 0 | |
Fair Value, Inputs, Level 3 | Residential mortgage-backed securities | Market Comparable Securities | Comparability Adjustment | Maximum | ||
Assets: | ||
Assets measured at fair value | 0.05 | |
Fair Value, Inputs, Level 3 | Residential mortgage-backed securities | Market Comparable Securities | Comparability Adjustment | Weighted Average | ||
Assets: | ||
Assets measured at fair value | 0.025 | |
Fair Value, Inputs, Level 3 | Residential mortgage-backed securities | Discounted Cash Flows | Comparability Adjustment | Minimum | ||
Assets: | ||
Assets measured at fair value | 0 | |
Fair Value, Inputs, Level 3 | Residential mortgage-backed securities | Discounted Cash Flows | Comparability Adjustment | Maximum | ||
Assets: | ||
Assets measured at fair value | 0.05 | |
Fair Value, Inputs, Level 3 | Residential mortgage-backed securities | Discounted Cash Flows | Comparability Adjustment | Weighted Average | ||
Assets: | ||
Assets measured at fair value | 0.025 | |
Fair Value, Inputs, Level 3 | Other asset-backed securities | ||
Assets: | ||
Fixed maturities available for sale, at fair value | $ 6,661 | 2,992 |
Fair Value, Inputs, Level 3 | Other asset-backed securities | Market Comparable Securities | Comparability Adjustment | Minimum | ||
Assets: | ||
Assets measured at fair value | 0 | |
Fair Value, Inputs, Level 3 | Other asset-backed securities | Market Comparable Securities | Comparability Adjustment | Maximum | ||
Assets: | ||
Assets measured at fair value | 0.05 | |
Fair Value, Inputs, Level 3 | Other asset-backed securities | Market Comparable Securities | Comparability Adjustment | Weighted Average | ||
Assets: | ||
Assets measured at fair value | 0.025 | |
Fair Value, Inputs, Level 3 | Other asset-backed securities | Discounted Cash Flows | Comparability Adjustment | Minimum | ||
Assets: | ||
Assets measured at fair value | 0 | |
Fair Value, Inputs, Level 3 | Other asset-backed securities | Discounted Cash Flows | Comparability Adjustment | Maximum | ||
Assets: | ||
Assets measured at fair value | 0.05 | |
Fair Value, Inputs, Level 3 | Other asset-backed securities | Discounted Cash Flows | Comparability Adjustment | Weighted Average | ||
Assets: | ||
Assets measured at fair value | 0.025 | |
Fair Value, Inputs, Level 3 | Other investments | ||
Assets: | ||
Other investments | $ 0 | $ 3,086 |
Fair Value, Inputs, Level 3 | Other investments | Discounted Cash Flows | Comparability Adjustment | Minimum | ||
Assets: | ||
Other assets, measurement input | 0.00% | |
Fair Value, Inputs, Level 3 | Other investments | Discounted Cash Flows | Comparability Adjustment | Maximum | ||
Assets: | ||
Other assets, measurement input | 10.00% | |
Fair Value, Inputs, Level 3 | Other investments | Discounted Cash Flows | Comparability Adjustment | Weighted Average | ||
Assets: | ||
Other assets, measurement input | 5.00% |
Fair Value Measurement - Level
Fair Value Measurement - Level 3 Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation: | ||
Beginning Balance | $ 11,157 | $ 8,175 |
Total gains (losses) realized and unrealized: | ||
Included in other comprehensive income | 325 | 239 |
Purchases | 23,359 | 6,666 |
Sales | (6,524) | (4,368) |
Transfers in | 1,550 | 5,729 |
Transfers out | (18,032) | (5,233) |
Ending Balance | 11,958 | 11,157 |
Change in unrealized gains (losses) included in earnings for the above period for Level 3 assets held at period-end | 151 | 164 |
Net investment income | ||
Total gains (losses) realized and unrealized: | ||
Included in earnings | (20) | (202) |
Net realized investment gains (losses) | ||
Total gains (losses) realized and unrealized: | ||
Included in earnings | 143 | 151 |
Corporate debt | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation: | ||
Beginning Balance | 5,079 | 4,322 |
Total gains (losses) realized and unrealized: | ||
Included in other comprehensive income | 216 | 37 |
Purchases | 2,869 | 3,575 |
Sales | (2,178) | (3,702) |
Transfers in | 945 | 3,095 |
Transfers out | (3,664) | (2,250) |
Ending Balance | 3,265 | 5,079 |
Change in unrealized gains (losses) included in earnings for the above period for Level 3 assets held at period-end | 0 | 0 |
Corporate debt | Net investment income | ||
Total gains (losses) realized and unrealized: | ||
Included in earnings | (2) | 2 |
Corporate debt | Net realized investment gains (losses) | ||
Total gains (losses) realized and unrealized: | ||
Included in earnings | 0 | 0 |
Asset-backed Securities | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation: | ||
Beginning Balance | 2,992 | 3,850 |
Total gains (losses) realized and unrealized: | ||
Included in other comprehensive income | 109 | 202 |
Purchases | 20,490 | 0 |
Sales | (4,346) | (494) |
Transfers in | 605 | 2,216 |
Transfers out | (11,131) | (2,578) |
Ending Balance | 8,693 | 2,992 |
Change in unrealized gains (losses) included in earnings for the above period for Level 3 assets held at period-end | 0 | 0 |
Asset-backed Securities | Net investment income | ||
Total gains (losses) realized and unrealized: | ||
Included in earnings | (18) | (204) |
Asset-backed Securities | Net realized investment gains (losses) | ||
Total gains (losses) realized and unrealized: | ||
Included in earnings | (8) | 0 |
Other Investments | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation: | ||
Beginning Balance | 3,086 | 3 |
Total gains (losses) realized and unrealized: | ||
Included in other comprehensive income | 0 | 0 |
Purchases | 0 | 3,091 |
Sales | 0 | (172) |
Transfers in | 0 | 418 |
Transfers out | (3,237) | (405) |
Ending Balance | 0 | 3,086 |
Change in unrealized gains (losses) included in earnings for the above period for Level 3 assets held at period-end | 151 | 164 |
Other Investments | Net investment income | ||
Total gains (losses) realized and unrealized: | ||
Included in earnings | 0 | 0 |
Other Investments | Net realized investment gains (losses) | ||
Total gains (losses) realized and unrealized: | ||
Included in earnings | $ 151 | $ 151 |
Fair Value Measurement - Invest
Fair Value Measurement - Investments in LLCs and Limited Partnerships (Details) | 12 Months Ended | |
Dec. 31, 2020USD ($)fundlender | Dec. 31, 2019USD ($) | |
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Alternative investment | $ 246,259,000 | $ 293,001,000 |
Mortgage fund | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Entities that calculate net asset value notice period (years) | 65 days | |
Payment period for redemption of LP valued at NAV (years) | 45 days | |
Private debt funds | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Number of unrelated LPs funds | fund | 2 | |
Number of LPs to allow redemption by special consent (in funds) | fund | 1 | |
Private debt funds | Minimum | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Anticipated time frame for distribution at the discretion of the LP (years) | 3 years | |
Private debt funds | Maximum | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Anticipated time frame for distribution at the discretion of the LP (years) | 8 years | |
Long/short equity funds | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Payment period for redemption of LP valued at NAV (years) | 30 days | |
Redemption percentage of LP at NAV for which initial payment is limited (percent) | 90.00% | |
Non-public equity funds | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Anticipated time frame for distribution at the discretion of the LP (years) | 10 years | |
Structured credit fund | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Number of unrelated LPs funds | lender | 4 | |
Anticipated time frame for distribution at the discretion of the LP (years) | 12 years | |
Prior notice requirement notice for two funds | 90 days | |
Prior notice requirement notice for one funds | 180 days | |
Equities | Mortgage fund | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Unfunded Commitments | $ 0 | |
Alternative investment | 12,548,000 | 22,477,000 |
Investment in unconsolidated subsidiaries | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Alternative investment | 233,711,000 | 270,524,000 |
Investment in unconsolidated subsidiaries | Private debt funds | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Unfunded Commitments | 12,395,000 | |
Alternative investment | 16,387,000 | 19,011,000 |
Investment in unconsolidated subsidiaries | Long equity fund | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Unfunded Commitments | 0 | |
Alternative investment | 0 | 5,293,000 |
Investment in unconsolidated subsidiaries | Long/short equity funds | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Unfunded Commitments | 0 | |
Alternative investment | 596,000 | 30,542,000 |
Investment in unconsolidated subsidiaries | Non-public equity funds | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Unfunded Commitments | 44,252,000 | |
Alternative investment | 138,357,000 | 120,343,000 |
Investment in unconsolidated subsidiaries | Multi-strategy fund of funds | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Unfunded Commitments | 0 | |
Alternative investment | 0 | 1,951,000 |
Investment in unconsolidated subsidiaries | Structured credit fund | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Unfunded Commitments | 1,937,000 | |
Alternative investment | 34,848,000 | 42,415,000 |
Investment in unconsolidated subsidiaries | Long/short commodities fund | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Unfunded Commitments | 0 | |
Alternative investment | 0 | 14,519,000 |
Investment in unconsolidated subsidiaries | Strategy focused fund | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Unfunded Commitments | 38,103,000 | |
Alternative investment | $ 43,523,000 | $ 36,450,000 |
Fair Value Measurement - Method
Fair Value Measurement - Methodologies Other Than Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Carrying Value | ||
Financial assets: | ||
Other assets | $ 31,128 | $ 28,645 |
Financial liabilities: | ||
Other liabilities | 30,334 | 27,953 |
Carrying Value | Senior Notes | ||
Financial liabilities: | ||
Debt | 250,000 | 250,000 |
Carrying Value | Mortgage Loans | ||
Financial liabilities: | ||
Debt | 36,113 | 37,617 |
Fair Value | ||
Financial assets: | ||
Other assets | 31,141 | 28,650 |
Financial liabilities: | ||
Other liabilities | 30,334 | 27,953 |
Fair Value | Senior Notes | ||
Financial liabilities: | ||
Debt | 269,160 | 273,865 |
Fair Value | Mortgage Loans | ||
Financial liabilities: | ||
Debt | 36,113 | 37,617 |
BOLI | Carrying Value | ||
Financial assets: | ||
Other investments | 67,847 | 66,112 |
BOLI | Fair Value | ||
Financial assets: | ||
Other investments | 67,847 | 66,112 |
Other Investments | Carrying Value | ||
Financial assets: | ||
Other investments | 2,952 | 2,931 |
Other Investments | Fair Value | ||
Financial assets: | ||
Other investments | $ 2,952 | $ 2,931 |
Investments - Available-For-Sal
Investments - Available-For-Sale Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 2,361,575 | $ 2,241,304 |
Allowance for Expected Credit Losses | 552 | 0 |
Gross Unrealized Gains | 99,936 | 50,565 |
Gross Unrealized Losses | 3,428 | 3,084 |
Estimated Fair Value | 2,457,531 | 2,288,785 |
U.S. Treasury obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 104,097 | 109,060 |
Allowance for Expected Credit Losses | 0 | |
Gross Unrealized Gains | 2,985 | 1,533 |
Gross Unrealized Losses | 23 | 126 |
Estimated Fair Value | 107,059 | 110,467 |
U.S. Government-sponsored enterprise obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 12,103 | 17,215 |
Allowance for Expected Credit Losses | 0 | |
Gross Unrealized Gains | 158 | 125 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 12,261 | 17,340 |
State and municipal bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 316,022 | 287,658 |
Allowance for Expected Credit Losses | 0 | |
Gross Unrealized Gains | 16,937 | 9,110 |
Gross Unrealized Losses | 39 | 675 |
Estimated Fair Value | 332,920 | 296,093 |
Corporate debt | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,267,992 | 1,308,889 |
Allowance for Expected Credit Losses | 552 | 0 |
Gross Unrealized Gains | 63,204 | 33,050 |
Gross Unrealized Losses | 1,302 | 1,575 |
Estimated Fair Value | 1,329,342 | 1,340,364 |
Residential mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 269,752 | 205,588 |
Allowance for Expected Credit Losses | 0 | |
Gross Unrealized Gains | 7,171 | 3,139 |
Gross Unrealized Losses | 382 | 319 |
Estimated Fair Value | 276,541 | 208,408 |
Agency commercial mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 12,623 | 8,054 |
Allowance for Expected Credit Losses | 0 | |
Gross Unrealized Gains | 687 | 182 |
Gross Unrealized Losses | 0 | 15 |
Estimated Fair Value | 13,310 | 8,221 |
Other commercial mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 109,244 | 70,621 |
Allowance for Expected Credit Losses | 0 | |
Gross Unrealized Gains | 4,788 | 1,468 |
Gross Unrealized Losses | 940 | 221 |
Estimated Fair Value | 113,092 | 71,868 |
Other asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 269,742 | 234,219 |
Allowance for Expected Credit Losses | 0 | |
Gross Unrealized Gains | 4,006 | 1,958 |
Gross Unrealized Losses | 742 | 153 |
Estimated Fair Value | $ 273,006 | $ 236,024 |
Investments - Available-For-S_2
Investments - Available-For-Sale Securities by Contractual Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Fixed maturities, available for sale | ||
Amortized Cost | $ 2,361,575 | $ 2,241,304 |
Total Fair Value | 2,457,531 | 2,288,785 |
U.S. Treasury obligations | ||
Fixed maturities, available for sale | ||
Amortized Cost | 104,097 | 109,060 |
Due in one year or less | 23,049 | |
Due after one year through five years | 73,580 | |
Due after five years through ten years | 10,430 | |
Due after ten years | 0 | |
Total Fair Value | 107,059 | 110,467 |
U.S. Government-sponsored enterprise obligations | ||
Fixed maturities, available for sale | ||
Amortized Cost | 12,103 | 17,215 |
Due in one year or less | 0 | |
Due after one year through five years | 9,093 | |
Due after five years through ten years | 3,014 | |
Due after ten years | 154 | |
Total Fair Value | 12,261 | 17,340 |
State and municipal bonds | ||
Fixed maturities, available for sale | ||
Amortized Cost | 316,022 | 287,658 |
Due in one year or less | 14,466 | |
Due after one year through five years | 141,826 | |
Due after five years through ten years | 158,927 | |
Due after ten years | 17,701 | |
Total Fair Value | 332,920 | 296,093 |
Corporate debt | ||
Fixed maturities, available for sale | ||
Amortized Cost | 1,267,992 | 1,308,889 |
Due in one year or less | 143,719 | |
Due after one year through five years | 700,708 | |
Due after five years through ten years | 425,711 | |
Due after ten years | 59,204 | |
Total Fair Value | 1,329,342 | 1,340,364 |
Residential mortgage-backed securities | ||
Fixed maturities, available for sale | ||
Amortized Cost | 269,752 | 205,588 |
Total Fair Value | 276,541 | 208,408 |
Agency commercial mortgage-backed securities | ||
Fixed maturities, available for sale | ||
Amortized Cost | 12,623 | 8,054 |
Total Fair Value | 13,310 | 8,221 |
Other commercial mortgage-backed securities | ||
Fixed maturities, available for sale | ||
Amortized Cost | 109,244 | 70,621 |
Total Fair Value | 113,092 | 71,868 |
Other asset-backed securities | ||
Fixed maturities, available for sale | ||
Amortized Cost | 269,742 | 234,219 |
Total Fair Value | $ 273,006 | $ 236,024 |
Investments - Available-For-S_3
Investments - Available-For-Sale Securities Narrative (Details) $ in Millions | 3 Months Ended | ||
Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($)investment_affiliate | Dec. 31, 2019 | |
Debt Securities, Available-for-sale [Line Items] | |||
Number of investment affiliates exceeding shareholder's equity ten percent threshold limit (in affiliates) | investment_affiliate | 0 | ||
Threshold limit of investments based on shareholders' equity (percent) | 10.00% | ||
Securities on deposit with state insurance departments | $ 42.3 | ||
Syndicate 1729 | |||
Debt Securities, Available-for-sale [Line Items] | |||
Return of deposit assets | $ 32.3 | ||
Proportion of capital provided to support Lloyd's syndicate (percent) | 29.00% | 29.00% | 61.00% |
Fixed maturities | |||
Debt Securities, Available-for-sale [Line Items] | |||
FAL deposit assets | $ 95 | ||
Cash and Cash Equivalents | |||
Debt Securities, Available-for-sale [Line Items] | |||
FAL deposit assets | $ 11.2 |
Investments - Investments Held
Investments - Investments Held in a Loss Position (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Fair value | ||
Fair value, total | $ 212,934 | $ 317,779 |
Fair value, less than 12 months | 191,081 | 221,960 |
Fair value, 12 months or longer | 21,853 | 95,819 |
Unrealized Loss | ||
Unrealized loss, total | 3,428 | 3,084 |
Unrealized loss, less than 12 months | 3,099 | 2,123 |
Unrealized loss, 12 months or longer | 329 | 961 |
U.S. Treasury obligations | ||
Fair value | ||
Fair value, total | 14,390 | 25,959 |
Fair value, less than 12 months | 14,390 | 15,305 |
Fair value, 12 months or longer | 0 | 10,654 |
Unrealized Loss | ||
Unrealized loss, total | 23 | 126 |
Unrealized loss, less than 12 months | 23 | 103 |
Unrealized loss, 12 months or longer | 0 | 23 |
State and municipal bonds | ||
Fair value | ||
Fair value, total | 6,416 | 36,565 |
Fair value, less than 12 months | 6,416 | 35,621 |
Fair value, 12 months or longer | 0 | 944 |
Unrealized Loss | ||
Unrealized loss, total | 39 | 675 |
Unrealized loss, less than 12 months | 39 | 674 |
Unrealized loss, 12 months or longer | 0 | 1 |
Corporate debt | ||
Fair value | ||
Fair value, total | 94,695 | 128,254 |
Fair value, less than 12 months | 79,436 | 88,582 |
Fair value, 12 months or longer | 15,259 | 39,672 |
Unrealized Loss | ||
Unrealized loss, total | 1,302 | 1,575 |
Unrealized loss, less than 12 months | 1,020 | 932 |
Unrealized loss, 12 months or longer | 282 | 643 |
Residential mortgage-backed securities | ||
Fair value | ||
Fair value, total | 34,928 | 59,291 |
Fair value, less than 12 months | 34,509 | 28,048 |
Fair value, 12 months or longer | 419 | 31,243 |
Unrealized Loss | ||
Unrealized loss, total | 382 | 319 |
Unrealized loss, less than 12 months | 381 | 63 |
Unrealized loss, 12 months or longer | 1 | 256 |
Agency commercial mortgage-backed securities | ||
Fair value | ||
Fair value, total | 459 | |
Fair value, less than 12 months | 158 | |
Fair value, 12 months or longer | 301 | |
Unrealized Loss | ||
Unrealized loss, total | 15 | |
Unrealized loss, less than 12 months | 0 | |
Unrealized loss, 12 months or longer | 15 | |
Other commercial mortgage-backed securities | ||
Fair value | ||
Fair value, total | 18,766 | 18,339 |
Fair value, less than 12 months | 18,480 | 16,924 |
Fair value, 12 months or longer | 286 | 1,415 |
Unrealized Loss | ||
Unrealized loss, total | 940 | 221 |
Unrealized loss, less than 12 months | 935 | 206 |
Unrealized loss, 12 months or longer | 5 | 15 |
Other asset-backed securities | ||
Fair value | ||
Fair value, total | 43,739 | 48,912 |
Fair value, less than 12 months | 37,850 | 37,322 |
Fair value, 12 months or longer | 5,889 | 11,590 |
Unrealized Loss | ||
Unrealized loss, total | 742 | 153 |
Unrealized loss, less than 12 months | 701 | 145 |
Unrealized loss, 12 months or longer | $ 41 | $ 8 |
Investments - Investments Hel_2
Investments - Investments Held in a Loss Position Narrative (Details) - Non Government-Backed $ in Millions | Dec. 31, 2020USD ($)securityissuer | Dec. 31, 2019USD ($)securityissuer |
Debt Securities, Available-for-sale [Line Items] | ||
Debt securities in unrealized loss position (in securities) | security | 292 | 263 |
Debt securities in unrealized loss position as percentage of total debt securities held (percent) | 11.10% | 12.10% |
Number of issuers in unrealized loss position (in issuers) | issuer | 229 | 204 |
Single greatest unrealized loss position | $ 0.4 | $ 0.2 |
Second greatest unrealized loss position | $ 0.2 | $ 0.1 |
Investments - Credit Losses Rel
Investments - Credit Losses Related to Debt Securities (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |
Allowance for credit loss beginning balance | $ 0 |
No allowance for credit losses has been previously recognized | 1,508 |
Securities sold during the period | (956) |
Allowance for credit loss ending balance | 552 |
Corporate debt | |
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |
Allowance for credit loss beginning balance | 0 |
No allowance for credit losses has been previously recognized | 1,508 |
Securities sold during the period | (956) |
Allowance for credit loss ending balance | $ 552 |
Investments - Sales and Purchas
Investments - Sales and Purchases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |||
Proceeds from sales (exclusive of maturities and paydowns) | $ 354,400 | $ 177,100 | $ 599,600 |
Purchases | $ 917,037 | $ 695,552 | $ 780,698 |
Investments - Net Investment In
Investments - Net Investment Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Debt Securities, Available-for-sale [Line Items] | |||
Investment fees and expenses | $ (6,385) | $ (6,484) | $ (6,681) |
Net investment income | 71,998 | 93,269 | 91,884 |
Fixed maturities | |||
Debt Securities, Available-for-sale [Line Items] | |||
Investment income | 69,308 | 72,593 | 69,515 |
Equities | |||
Debt Securities, Available-for-sale [Line Items] | |||
Investment income | 4,369 | 17,650 | 21,418 |
Short-term investments, including Other | |||
Debt Securities, Available-for-sale [Line Items] | |||
Investment income | 2,683 | 7,493 | 5,649 |
BOLI | |||
Debt Securities, Available-for-sale [Line Items] | |||
Investment income | $ 2,023 | $ 2,017 | $ 1,983 |
Investments - Investments in Un
Investments - Investments in Unconsolidated Subsidiaries (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Schedule of Equity Method Investments [Line Items] | ||
Investment in unconsolidated subsidiaries | $ 310,529 | $ 358,820 |
Qualified affordable housing project tax credit partnerships | ||
Schedule of Equity Method Investments [Line Items] | ||
Investment in unconsolidated subsidiaries | 27,719 | 46,421 |
Other tax credit partnerships | ||
Schedule of Equity Method Investments [Line Items] | ||
Investment in unconsolidated subsidiaries | 0 | 2,085 |
All other investments, primarily investment fund LPs/LLCs | ||
Schedule of Equity Method Investments [Line Items] | ||
Investment in unconsolidated subsidiaries | $ 282,810 | $ 310,314 |
Investments - Investments in _2
Investments - Investments in Unconsolidated Subsidiaries Narrative (Details) $ in Thousands | Dec. 31, 2020USD ($)partnershipbusiness | Dec. 31, 2019USD ($) |
Debt Securities, Available-for-sale [Line Items] | ||
Business owned life insurance cost | $ 33,000 | |
Investment in unconsolidated subsidiaries | $ 310,529 | $ 358,820 |
Number of LPs / LLCs with investment ownership percent over 25% (in businesses) | business | 4 | |
Tax Credit Partnerships Almost 100% Ownership | ||
Debt Securities, Available-for-sale [Line Items] | ||
Number of tax credit partnerships almost 100% ownership percentage (in investment interest) | partnership | 2 | |
Investment in unconsolidated subsidiaries | $ 9,400 | 17,200 |
Tax Credit Partnerships Less Than 20% Ownership | ||
Debt Securities, Available-for-sale [Line Items] | ||
Investment in unconsolidated subsidiaries | $ 18,300 | 29,200 |
Other Limited Partnerships and Limited Liability Company, Greater Than 25 Percent Ownership | ||
Debt Securities, Available-for-sale [Line Items] | ||
Percentage ownership | 25.00% | |
Investment in unconsolidated subsidiaries | $ 46,200 | 41,000 |
Other Limited Partnerships and Limited Liability Company Less than 25% Ownership | ||
Debt Securities, Available-for-sale [Line Items] | ||
Percentage ownership | 25.00% | |
Investment in unconsolidated subsidiaries | $ 236,600 | $ 269,300 |
Maximum | Tax Credit Partnerships Almost 100% Ownership | ||
Debt Securities, Available-for-sale [Line Items] | ||
Percentage ownership | 100.00% | |
Maximum | Tax Credit Partnerships Less Than 20% Ownership | ||
Debt Securities, Available-for-sale [Line Items] | ||
Percentage ownership | 20.00% |
Investments - Equity in Earning
Investments - Equity in Earnings (Loss) of Unconsolidated Subsidiaries (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |||
Losses recorded | $ 18,684 | $ 19,231 | $ 18,889 |
Tax credits recognized | 17,465 | 21,933 | 18,474 |
Losses recorded | 1,092 | 1,672 | 5,434 |
Tax credits recognized | $ 412 | $ 0 | $ 2,567 |
Investments - Net Realized Inve
Investments - Net Realized Investment Gains (Losses) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |||
Impairment Losses | $ (1,745) | $ (978) | $ (490) |
Portion of impairment losses recognized in other comprehensive income (loss) before taxes | 237 | 227 | 0 |
Net impairment losses recognized in earnings | (1,508) | (751) | (490) |
Gross realized gains, available-for-sale fixed maturities | 13,855 | 3,786 | 5,942 |
Gross realized (losses), available-for-sale fixed maturities | (2,501) | (538) | (5,799) |
Net realized gains (losses), trading fixed maturities | 288 | 74 | (100) |
Net realized gains (losses), equity investments | 13,192 | 20,577 | 12,230 |
Net realized gains (losses), other investments | 3,883 | 1,626 | 1,340 |
Change in unrealized holding gains (losses), trading fixed maturities | 501 | 705 | (317) |
Change in unrealized holding gains (losses), equity investments | (16,287) | 30,674 | (52,707) |
Change in unrealized holding gains (losses), convertible securities, carried at fair value | 3,850 | 3,653 | (3,849) |
Other | 405 | 68 | 262 |
Total net realized investment gains (losses) | $ 15,678 | $ 59,874 | $ (43,488) |
Investments - Net Realized In_2
Investments - Net Realized Investment Gains (Losses) Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |||
OTTI loss, debt securities, portion recognized in earnings | $ 1,508 | $ 751 | $ 490 |
Net realized gains (losses) | $ 15,678 | $ 59,874 | $ (43,488) |
Investments - Roll Forward of C
Investments - Roll Forward of Cumulative Credit Losses Recorded in Earnings (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |||
Balance beginning of period | $ 470 | $ 93 | $ 1,313 |
No impairment has been previously recognized | 1,064 | 377 | 0 |
Impairment has been previously recognized | 258 | 0 | 0 |
Securities sold during the period (realized) | (1,240) | 0 | (1,220) |
Balance December 31 | $ 552 | $ 470 | $ 93 |
Investments - Equity in Earni_2
Investments - Equity in Earnings (Loss) of Unconsolidated Subsidiaries Narrative (Details) - Tax Credit from Tax Credit Partnership Investments - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Tax Credit Carryforward [Line Items] | ||
Tax credits | $ 36.1 | |
Tax Year 2040 | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | $ 17.9 | |
Tax Year 2039 | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | $ 18.2 |
Reinsurance - Premiums Written
Reinsurance - Premiums Written and Earned (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Summary of the effect of reinsurance on premiums written and earned | |||
Direct premiums written | $ 814,298 | $ 919,799 | $ 910,198 |
Assumed premiums written | 40,124 | 47,691 | 47,113 |
Ceded premiums written | (106,721) | (124,765) | (122,397) |
Net premiums written | 747,701 | 842,725 | 834,914 |
Direct premiums earned | 862,742 | 926,035 | 903,354 |
Assumed premiums earned | 43,555 | 45,668 | 41,535 |
Ceded premiums earned | (113,582) | (124,171) | (126,036) |
Net premiums earned | 792,715 | 847,532 | 818,853 |
Losses and loss adjustment expenses | 741,719 | 871,780 | 675,784 |
Reinsurance recoveries | (80,272) | (117,865) | (82,574) |
Net losses and loss adjustment expenses | $ 661,447 | $ 753,915 | $ 593,210 |
Reinsurance - Narrative (Detail
Reinsurance - Narrative (Details) | 12 Months Ended | ||||
Dec. 31, 2020USD ($)reinsurer | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | |
Ceded Credit Risk [Line Items] | |||||
Premium ceded increase (reduction) amount | $ 700,000 | $ 2,800,000 | $ 5,500,000 | ||
Amount due from reinsurers total | $ 395,300,000 | ||||
Number of major reinsurers | reinsurer | 0 | ||||
Amount of reinsurance recoverables collateralized by letters of credit | $ 96,100,000 | ||||
Allowance for created losses related to reinsurance receivables | 0 | 0 | 0 | ||
Loss on uncollectible accounts in the period | 0 | 0 | 0 | ||
Cash receipt for reinsurance commutations | 14,370,000 | 12,739,000 | |||
Specialty P&C | |||||
Ceded Credit Risk [Line Items] | |||||
Amount of reinsurance recoverables collateralized by letters of credit | 7,000,000 | $ 3,800,000 | $ 6,700,000 | ||
Cash receipt for reinsurance commutations | 6,800,000 | $ 3,100,000 | $ 6,100,000 | ||
Minimum | |||||
Ceded Credit Risk [Line Items] | |||||
Major reinsurer threshold | $ 51,000,000 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets | ||
Unpaid loss discount | $ 36,452 | $ 34,455 |
Unearned premium adjustment | 14,835 | 16,346 |
Compensation related | 10,935 | 10,041 |
Basis differentials–investments | 2,595 | 0 |
Intangibles | 522 | 591 |
Operating lease liabilities | 4,224 | 4,631 |
Basis differentials-foreign operations | 0 | 126 |
Tax credit carryforward | 36,155 | 21,778 |
Net operating loss carryforward | 9,244 | 7,682 |
Other | 1,700 | 0 |
Total gross deferred tax assets | 116,662 | 95,650 |
Valuation allowance | (8,581) | (5,479) |
Total deferred tax assets, net of valuation allowance | 108,081 | 90,171 |
Deferred tax liabilities | ||
Deferred policy acquisition costs | (8,929) | (9,889) |
Unpaid loss discount–transition | (6,297) | (7,557) |
Unrealized gains on investments, net | (19,351) | (9,753) |
Fixed assets | (4,441) | (1,263) |
Operating lease ROU assets | (4,015) | (4,439) |
Basis differentials–investments | 0 | (2,377) |
Basis differentials-foreign operations | (790) | 0 |
Intangibles | (7,153) | (10,382) |
Other | 0 | (124) |
Total deferred tax liabilities | (50,976) | (45,784) |
Net deferred tax assets (liabilities) | $ 57,105 | $ 44,387 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Contingency [Line Items] | |||||
Deferred tax asset, net | $ 57,105,000 | $ 57,105,000 | $ 44,387,000 | ||
Income tax receivable | 18,900,000 | 18,900,000 | 8,000,000 | ||
Uncertain tax positions that would impact effective tax rate | 800,000 | 800,000 | 1,200,000 | ||
Goodwill impairment | 0 | $ 161,100,000 | 161,115,000 | 0 | $ 0 |
Non-deductible goodwill impairment loss | 149,600,000 | ||||
Deductible goodwill impairment losses | 11,500,000 | ||||
Interest expense | |||||
Income Tax Contingency [Line Items] | |||||
Accrued liability for interest | 500,000 | 500,000 | 600,000 | ||
Inova Re | |||||
Income Tax Contingency [Line Items] | |||||
Deferred tax asset, net | 500,000 | 500,000 | 600,000 | ||
State | |||||
Income Tax Contingency [Line Items] | |||||
Net operating loss carryforwards | 52,700,000 | 52,700,000 | |||
Valuation allowance related to NOL carryforwards | 1,900,000 | 1,900,000 | |||
Foreign | |||||
Income Tax Contingency [Line Items] | |||||
Net operating loss carryforwards | 32,900,000 | 32,900,000 | |||
Valuation allowance related to NOL carryforwards | 6,200,000 | 6,200,000 | 4,900,000 | ||
Tax Credit from Tax Credit Partnership Investments | |||||
Income Tax Contingency [Line Items] | |||||
Tax credit carryforwards | 36,100,000 | 36,100,000 | |||
Tax Year 2020 | |||||
Income Tax Contingency [Line Items] | |||||
Net operating loss carryforwards | 45,300,000 | 45,300,000 | |||
Income tax refund, CARES Act | 15,900,000 | 15,900,000 | |||
Tax Year 2019 | |||||
Income Tax Contingency [Line Items] | |||||
Net operating loss carryforwards | 25,600,000 | 25,600,000 | |||
Income tax refund, CARES Act | 9,000,000 | 9,000,000 | |||
Tax Year 2039 | Tax Credit from Tax Credit Partnership Investments | |||||
Income Tax Contingency [Line Items] | |||||
Tax credit carryforwards | $ 18,200,000 | ||||
Tax Year 2040 | Tax Credit from Tax Credit Partnership Investments | |||||
Income Tax Contingency [Line Items] | |||||
Tax credit carryforwards | $ 17,900,000 | $ 17,900,000 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of unrecognized tax benefits | |||
Balance at January 1 | $ 5,070 | $ 3,601 | $ 5,341 |
Increases for tax positions taken during the current year | 0 | 1,749 | 0 |
Decreases for tax positions taken during the current year | (4,853) | 0 | (777) |
Increases for tax positions taken during prior years | 5,342 | 0 | 0 |
Increases for tax positions taken during prior years | 0 | 0 | (800) |
Decreases relating to a lapse of the applicable statute of limitations | (360) | (280) | (163) |
Balance at December 31 | $ 5,199 | $ 5,070 | $ 3,601 |
Income Taxes - Components of Ta
Income Taxes - Components of Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Current expense (benefit) | |||
Federal and foreign | $ (19,885) | $ (2,147) | $ (6,509) |
State | (296) | 982 | 301 |
Total current expense (benefit) | (20,181) | (1,165) | (6,208) |
Deferred expense (benefit) | |||
Federal and foreign | (20,476) | (27,404) | (11,765) |
State | (672) | (1,239) | (59) |
Total deferred expense (benefit) | (21,148) | (28,643) | (11,824) |
Total income tax expense (benefit) | $ (41,329) | $ (29,808) | $ (18,032) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of expected income tax expense to actual income tax expense | |||
Computed “expected” tax expense (benefit) | $ (45,582) | $ (6,049) | $ 6,095 |
Tax-exempt income | (976) | (1,528) | (2,505) |
Tax credits | (17,876) | (21,933) | (21,059) |
Non-U.S. operating results | (1,307) | (1,447) | 2,269 |
Tax deficiency (excess tax benefit) on share-based compensation | 457 | 99 | (275) |
Tax rate differential on loss carryback | (7,758) | (3,400) | 0 |
Nondeductible goodwill impairment losses | 31,413 | 0 | 0 |
Provision-to-return differences | 1,217 | 3,595 | (2,309) |
Change in uncertain tax positions | (1,674) | 1,956 | (51) |
State income taxes | (561) | (376) | 129 |
Benefit from amended returns | 0 | (550) | 0 |
Other | 1,318 | (175) | (326) |
Total income tax expense (benefit) | $ (41,329) | $ (29,808) | $ (18,032) |
Goodwill (Narrative) (Details)
Goodwill (Narrative) (Details) | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2020USD ($)reporting_unit | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($)reporting_unit | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Goodwill [Line Items] | |||||
Number of reporting units | 5 | ||||
Number of reporting units with goodwill | 3 | ||||
Goodwill impairment | $ | $ 0 | $ (161,100,000) | $ (161,115,000) | $ 0 | $ 0 |
Number of reporting units with goodwill less than carrying amount | 2 | 2 | |||
Specialty P&C | |||||
Goodwill [Line Items] | |||||
Goodwill impairment | $ | $ (161,100,000) | $ (161,115,000) |
Goodwill (Carrying Amount of Go
Goodwill (Carrying Amount of Goodwill) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill [Roll Forward] | |||||
Goodwill, Beginning Balance | $ 161,100,000 | $ 210,725,000 | |||
Goodwill impairment | 0 | $ (161,100,000) | (161,115,000) | $ 0 | $ 0 |
Goodwill, Ending Balance | 49,610,000 | 161,100,000 | 49,610,000 | 210,725,000 | |
Specialty P&C | |||||
Goodwill [Roll Forward] | |||||
Goodwill, Beginning Balance | 161,115,000 | ||||
Goodwill impairment | $ (161,100,000) | (161,115,000) | |||
Goodwill, Ending Balance | 0 | 0 | 161,115,000 | ||
Workers' Compensation Insurance | |||||
Goodwill [Roll Forward] | |||||
Goodwill, Beginning Balance | 44,110,000 | ||||
Goodwill impairment | 0 | ||||
Goodwill, Ending Balance | 44,110,000 | 44,110,000 | 44,110,000 | ||
Segregated Portfolio Cell Reinsurance | |||||
Goodwill [Roll Forward] | |||||
Goodwill, Beginning Balance | 5,500,000 | ||||
Goodwill impairment | 0 | ||||
Goodwill, Ending Balance | $ 5,500,000 | $ 5,500,000 | $ 5,500,000 |
Deferred Policy Acquisition C_2
Deferred Policy Acquisition Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Insurance [Abstract] | |||
Amortization of deferred policy acquisition costs | $ 110,565 | $ 115,330 | $ 104,501 |
Premium deficiency reserve | $ 9,200 | $ 9,200 |
Reserve for Losses and Loss A_3
Reserve for Losses and Loss Adjustment Expenses - Narrative and Activity in the Reserve (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Jun. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Loss Contingencies [Line Items] | ||||
Minimum period for claims resolution (years) | 5 years | |||
Summary of reserve for losses and loss adjustment expenses | ||||
Balance, beginning of year | $ 2,346,526 | $ 2,119,847 | $ 2,048,381 | |
Less reinsurance recoverables on unpaid losses and loss adjustment expenses | 390,708 | 343,820 | 335,585 | |
Net balance, beginning of year | 1,955,818 | 1,776,027 | 1,712,796 | |
Net losses: | ||||
Current year | 711,846 | 765,698 | 685,326 | |
Favorable development of reserves established in prior years, net | (50,399) | (11,783) | (92,116) | |
Total | 661,447 | 753,915 | 593,210 | |
Paid related to: | ||||
Current year | (83,204) | (115,133) | (117,268) | |
Prior years | (501,969) | (458,991) | (412,711) | |
Total paid | (585,173) | (574,124) | (529,979) | |
Net balance, end of year | 2,032,092 | 1,955,818 | 1,776,027 | |
Plus reinsurance recoverables on unpaid losses and loss adjustment expenses | 385,087 | 390,708 | 343,820 | |
Balance, end of year | 2,417,179 | 2,346,526 | 2,119,847 | |
Premium deficiency reserve | 9,200 | 9,200 | ||
Specialty P&C | ||||
Net losses: | ||||
Current year | 497,554 | 526,744 | 461,516 | |
Favorable development of reserves established in prior years, net | (27,480) | 5,741 | $ (77,085) | |
Paid related to: | ||||
Premium deficiency reserve | 9,200 | 9,200 | ||
Specialty P&C | Retroactive insurance contract | ||||
Net losses: | ||||
Current year | $ 25,400 | $ 60,000 | $ 2,100 |
Reserve for Losses and Loss A_4
Reserve for Losses and Loss Adjustment Expenses - Claim Development (Details) $ in Thousands | 12 Months Ended | |||||||||
Dec. 31, 2020USD ($)claim | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) | Dec. 31, 2011USD ($) | |
Claims Development [Line Items] | ||||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | $ 1,838,703 | |||||||||
Healthcare Professional Liability claims-made | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 2,948,871 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 1,758,491 | |||||||||
All outstanding liabilities before 2011, net of reinsurance | 16,866 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 1,207,246 | |||||||||
Healthcare Professional Liability claims-made | 2011 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 251,440 | $ 253,163 | $ 254,329 | $ 264,777 | $ 278,258 | $ 289,400 | $ 305,540 | $ 331,884 | $ 344,808 | $ 348,916 |
Incurred but Not Reported Liabilities (IBNR) | $ (1,522) | |||||||||
Cumulative Number of Reported Claims | claim | 3,530 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 242,034 | 237,605 | 233,103 | 224,982 | 214,502 | 198,112 | 177,089 | 133,004 | 71,208 | 14,417 |
Healthcare Professional Liability claims-made | 2012 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 264,932 | 266,629 | 271,110 | 279,589 | 291,075 | 306,956 | 319,613 | 324,418 | 341,289 | |
Incurred but Not Reported Liabilities (IBNR) | $ (180) | |||||||||
Cumulative Number of Reported Claims | claim | 3,699 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 256,802 | 250,806 | 244,512 | 231,652 | 215,220 | 190,997 | 145,488 | 73,571 | 15,382 | |
Healthcare Professional Liability claims-made | 2013 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 249,477 | 248,594 | 258,251 | 272,364 | 287,140 | 296,550 | 304,209 | 315,346 | ||
Incurred but Not Reported Liabilities (IBNR) | $ (2,266) | |||||||||
Cumulative Number of Reported Claims | claim | 3,770 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 231,930 | 220,402 | 213,879 | 197,265 | 171,681 | 127,496 | 69,657 | 16,938 | ||
Healthcare Professional Liability claims-made | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 237,091 | 244,607 | 256,968 | 267,442 | 280,043 | 289,397 | 290,020 | |||
Incurred but Not Reported Liabilities (IBNR) | $ (3,596) | |||||||||
Cumulative Number of Reported Claims | claim | 3,316 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 210,534 | 200,392 | 186,239 | 154,236 | 116,791 | 59,485 | 16,764 | |||
Healthcare Professional Liability claims-made | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 256,082 | 256,785 | 270,814 | 271,138 | 269,980 | 276,492 | ||||
Incurred but Not Reported Liabilities (IBNR) | $ (8,109) | |||||||||
Cumulative Number of Reported Claims | claim | 3,267 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 218,066 | 195,047 | 161,896 | 111,741 | 55,731 | 9,172 | ||||
Healthcare Professional Liability claims-made | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 287,142 | 293,515 | 287,551 | 274,643 | 271,765 | |||||
Incurred but Not Reported Liabilities (IBNR) | $ (5,250) | |||||||||
Cumulative Number of Reported Claims | claim | 3,475 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 203,390 | 164,811 | 109,756 | 51,869 | 9,027 | |||||
Healthcare Professional Liability claims-made | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 325,919 | 331,304 | 295,883 | 283,746 | ||||||
Incurred but Not Reported Liabilities (IBNR) | $ (11,542) | |||||||||
Cumulative Number of Reported Claims | claim | 3,719 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 173,183 | 134,787 | 63,171 | 16,309 | ||||||
Healthcare Professional Liability claims-made | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 376,111 | 377,908 | 320,772 | |||||||
Incurred but Not Reported Liabilities (IBNR) | $ (26,964) | |||||||||
Cumulative Number of Reported Claims | claim | 4,150 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 141,609 | 79,291 | 14,051 | |||||||
Healthcare Professional Liability claims-made | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 374,525 | 377,242 | ||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 69,993 | |||||||||
Cumulative Number of Reported Claims | claim | 3,574 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 66,843 | 17,838 | ||||||||
Healthcare Professional Liability claims-made | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 326,152 | |||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 203,515 | |||||||||
Cumulative Number of Reported Claims | claim | 2,475 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 14,100 | |||||||||
Healthcare Professional Liability occurrence | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 352,191 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 142,386 | |||||||||
All outstanding liabilities before 2011, net of reinsurance | 6,115 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 215,920 | |||||||||
Healthcare Professional Liability occurrence | 2011 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 27,287 | 27,533 | 29,784 | 32,343 | 35,004 | 37,150 | 39,917 | 41,453 | 44,956 | 45,882 |
Incurred but Not Reported Liabilities (IBNR) | $ (254) | |||||||||
Cumulative Number of Reported Claims | claim | 344 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 25,111 | 24,933 | 24,539 | 23,194 | 21,416 | 19,197 | 16,544 | 8,059 | 2,803 | 291 |
Healthcare Professional Liability occurrence | 2012 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 26,533 | 25,705 | 29,857 | 32,691 | 34,774 | 40,692 | 44,848 | 46,513 | 45,703 | |
Incurred but Not Reported Liabilities (IBNR) | $ 143 | |||||||||
Cumulative Number of Reported Claims | claim | 400 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 24,138 | 23,600 | 23,095 | 21,435 | 19,275 | 12,212 | 7,705 | 2,430 | 363 | |
Healthcare Professional Liability occurrence | 2013 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 24,782 | 24,857 | 26,919 | 30,906 | 34,393 | 35,624 | 36,602 | 32,746 | ||
Incurred but Not Reported Liabilities (IBNR) | $ 74 | |||||||||
Cumulative Number of Reported Claims | claim | 360 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 21,954 | 21,241 | 18,949 | 16,787 | 14,753 | 7,826 | 3,170 | 369 | ||
Healthcare Professional Liability occurrence | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 22,048 | 22,243 | 25,885 | 29,869 | 32,143 | 29,918 | 30,420 | |||
Incurred but Not Reported Liabilities (IBNR) | $ 362 | |||||||||
Cumulative Number of Reported Claims | claim | 347 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 17,708 | 17,024 | 14,604 | 10,519 | 7,460 | 2,260 | 394 | |||
Healthcare Professional Liability occurrence | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 33,262 | 36,468 | 40,960 | 37,346 | 35,347 | 35,648 | ||||
Incurred but Not Reported Liabilities (IBNR) | $ (1,059) | |||||||||
Cumulative Number of Reported Claims | claim | 361 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 22,455 | 15,462 | 11,626 | 4,854 | 786 | (350) | ||||
Healthcare Professional Liability occurrence | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 29,426 | 25,019 | 27,240 | 28,790 | 29,609 | |||||
Incurred but Not Reported Liabilities (IBNR) | $ 2,174 | |||||||||
Cumulative Number of Reported Claims | claim | 373 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 17,918 | 10,576 | 2,883 | (195) | (182) | |||||
Healthcare Professional Liability occurrence | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 21,498 | 21,148 | 23,760 | 24,571 | ||||||
Incurred but Not Reported Liabilities (IBNR) | $ 5,199 | |||||||||
Cumulative Number of Reported Claims | claim | 415 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 1,313 | (2,765) | (5,858) | (6,809) | ||||||
Healthcare Professional Liability occurrence | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 40,304 | 41,555 | 38,420 | |||||||
Incurred but Not Reported Liabilities (IBNR) | $ 11,413 | |||||||||
Cumulative Number of Reported Claims | claim | 389 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 8,562 | 2,098 | 65 | |||||||
Healthcare Professional Liability occurrence | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 34,093 | 35,420 | ||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 20,945 | |||||||||
Cumulative Number of Reported Claims | claim | 339 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 3,167 | 439 | ||||||||
Healthcare Professional Liability occurrence | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 92,958 | |||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 90,916 | |||||||||
Cumulative Number of Reported Claims | claim | 130 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 60 | |||||||||
Medical Technology Liability claims-made | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 63,522 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 32,666 | |||||||||
All outstanding liabilities before 2011, net of reinsurance | 351 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 31,207 | |||||||||
Medical Technology Liability claims-made | 2011 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 7,725 | 7,944 | 8,202 | 12,358 | 12,487 | 13,794 | 15,836 | 19,166 | 20,930 | 17,249 |
Incurred but Not Reported Liabilities (IBNR) | $ 60 | |||||||||
Cumulative Number of Reported Claims | claim | 522 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 7,665 | 7,665 | 7,664 | 7,799 | 7,240 | 7,376 | 5,062 | 3,846 | 2,034 | 118 |
Medical Technology Liability claims-made | 2012 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 3,868 | 3,889 | 5,051 | 4,797 | 5,824 | 7,441 | 8,906 | 9,989 | 11,162 | |
Incurred but Not Reported Liabilities (IBNR) | $ 51 | |||||||||
Cumulative Number of Reported Claims | claim | 223 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 3,817 | 3,817 | 3,800 | 3,676 | 3,366 | 3,247 | 2,805 | 1,520 | 568 | |
Medical Technology Liability claims-made | 2013 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 3,305 | 3,504 | 3,566 | 4,697 | 7,226 | 9,536 | 9,955 | 9,807 | ||
Incurred but Not Reported Liabilities (IBNR) | $ 201 | |||||||||
Cumulative Number of Reported Claims | claim | 218 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 3,102 | 3,102 | 3,102 | 3,092 | 2,599 | 1,967 | 1,029 | 102 | ||
Medical Technology Liability claims-made | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 5,888 | 6,194 | 7,679 | 8,984 | 9,012 | 10,306 | 9,989 | |||
Incurred but Not Reported Liabilities (IBNR) | $ 396 | |||||||||
Cumulative Number of Reported Claims | claim | 272 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 4,074 | 3,776 | 3,724 | 3,046 | 2,564 | 1,527 | 388 | |||
Medical Technology Liability claims-made | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 4,664 | 5,081 | 5,929 | 7,193 | 8,757 | 9,376 | ||||
Incurred but Not Reported Liabilities (IBNR) | $ 1,194 | |||||||||
Cumulative Number of Reported Claims | claim | 156 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 2,911 | 2,567 | 2,097 | 1,625 | 440 | 25 | ||||
Medical Technology Liability claims-made | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 6,241 | 6,422 | 7,413 | 8,467 | 9,200 | |||||
Incurred but Not Reported Liabilities (IBNR) | $ 1,374 | |||||||||
Cumulative Number of Reported Claims | claim | 182 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 4,295 | 2,959 | 2,365 | 1,690 | 53 | |||||
Medical Technology Liability claims-made | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 4,919 | 8,306 | 10,143 | 11,049 | ||||||
Incurred but Not Reported Liabilities (IBNR) | $ 2,017 | |||||||||
Cumulative Number of Reported Claims | claim | 99 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 2,360 | 2,017 | 1,681 | 56 | ||||||
Medical Technology Liability claims-made | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 7,506 | 8,108 | 10,141 | |||||||
Incurred but Not Reported Liabilities (IBNR) | $ 4,595 | |||||||||
Cumulative Number of Reported Claims | claim | 218 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 1,850 | 191 | 6 | |||||||
Medical Technology Liability claims-made | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 8,324 | 10,072 | ||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 4,830 | |||||||||
Cumulative Number of Reported Claims | claim | 354 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 2,552 | 584 | ||||||||
Medical Technology Liability claims-made | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 11,082 | |||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 10,497 | |||||||||
Cumulative Number of Reported Claims | claim | 154 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 40 | |||||||||
Workers' Compensation Insurance | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 948,129 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 799,745 | |||||||||
All outstanding liabilities before 2011, net of reinsurance | 3,425 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 151,809 | |||||||||
Workers' Compensation Insurance | 2011 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 72,445 | 72,445 | 72,495 | 72,495 | 72,495 | 72,420 | 72,280 | 71,521 | 65,783 | 65,665 |
Incurred but Not Reported Liabilities (IBNR) | $ 21 | |||||||||
Cumulative Number of Reported Claims | claim | 15,245 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 72,013 | 71,927 | 71,856 | 71,662 | 70,934 | 70,146 | 67,945 | 62,307 | 50,900 | 21,993 |
Workers' Compensation Insurance | 2012 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 75,076 | 75,076 | 75,076 | 75,576 | 75,836 | 76,357 | 75,848 | 76,551 | 80,285 | |
Incurred but Not Reported Liabilities (IBNR) | $ 672 | |||||||||
Cumulative Number of Reported Claims | claim | 16,204 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 73,851 | 73,768 | 73,676 | 73,662 | 72,766 | 70,558 | 65,908 | 56,122 | 27,448 | |
Workers' Compensation Insurance | 2013 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 89,560 | 89,760 | 87,260 | 87,260 | 88,010 | 86,928 | 85,935 | 86,973 | ||
Incurred but Not Reported Liabilities (IBNR) | $ 983 | |||||||||
Cumulative Number of Reported Claims | claim | 16,429 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 87,772 | 87,466 | 86,783 | 85,689 | 82,369 | 76,813 | 63,825 | 30,554 | ||
Workers' Compensation Insurance | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 91,329 | 93,029 | 93,029 | 93,029 | 93,029 | 93,529 | 93,019 | |||
Incurred but Not Reported Liabilities (IBNR) | $ 1,594 | |||||||||
Cumulative Number of Reported Claims | claim | 16,210 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 88,487 | 87,998 | 87,314 | 85,022 | 77,631 | 65,922 | 30,368 | |||
Workers' Compensation Insurance | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 93,054 | 96,354 | 97,654 | 98,454 | 100,454 | 100,101 | ||||
Incurred but Not Reported Liabilities (IBNR) | $ 2,248 | |||||||||
Cumulative Number of Reported Claims | claim | 16,550 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 87,884 | 86,528 | 83,483 | 78,947 | 65,070 | 32,078 | ||||
Workers' Compensation Insurance | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 82,799 | 84,799 | 92,148 | 97,348 | 101,348 | |||||
Incurred but Not Reported Liabilities (IBNR) | $ 2,149 | |||||||||
Cumulative Number of Reported Claims | claim | 15,978 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 76,954 | 74,886 | 69,237 | 58,192 | 28,377 | |||||
Workers' Compensation Insurance | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 97,874 | 99,874 | 99,874 | 99,874 | ||||||
Incurred but Not Reported Liabilities (IBNR) | $ 4,581 | |||||||||
Cumulative Number of Reported Claims | claim | 16,083 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 87,129 | 82,289 | 70,333 | 31,586 | ||||||
Workers' Compensation Insurance | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 120,095 | 118,095 | 118,095 | |||||||
Incurred but Not Reported Liabilities (IBNR) | $ 2,054 | |||||||||
Cumulative Number of Reported Claims | claim | 18,009 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 104,216 | 86,063 | 41,619 | |||||||
Workers' Compensation Insurance | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 119,752 | 119,752 | ||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 9,768 | |||||||||
Cumulative Number of Reported Claims | claim | 17,517 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 88,008 | 40,994 | ||||||||
Workers' Compensation Insurance | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 106,145 | |||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 35,455 | |||||||||
Cumulative Number of Reported Claims | claim | 13,994 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 33,431 | |||||||||
Segregated Portfolio Cell Reinsurance | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 300,735 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 247,631 | |||||||||
All outstanding liabilities before 2011, net of reinsurance | 600 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 53,704 | |||||||||
Segregated Portfolio Cell Reinsurance | 2011 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 18,212 | 18,522 | 18,606 | 18,666 | 18,725 | 18,644 | 19,282 | 19,629 | 19,360 | 18,790 |
Incurred but Not Reported Liabilities (IBNR) | $ 27 | |||||||||
Cumulative Number of Reported Claims | claim | 3,154 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 18,185 | 18,185 | 18,185 | 18,176 | 18,177 | 18,054 | 17,869 | 17,197 | 14,045 | $ 5,940 |
Segregated Portfolio Cell Reinsurance | 2012 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 19,602 | 19,727 | 19,799 | 19,864 | 19,972 | 20,028 | 21,048 | 21,513 | 22,940 | |
Incurred but Not Reported Liabilities (IBNR) | $ 152 | |||||||||
Cumulative Number of Reported Claims | claim | 3,454 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 19,340 | 19,311 | 19,328 | 19,402 | 19,208 | 18,474 | 17,728 | 14,740 | $ 7,808 | |
Segregated Portfolio Cell Reinsurance | 2013 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 25,546 | 25,938 | 26,033 | 26,260 | 26,619 | 26,758 | 25,310 | 23,809 | ||
Incurred but Not Reported Liabilities (IBNR) | $ 104 | |||||||||
Cumulative Number of Reported Claims | claim | 3,723 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 25,442 | 25,440 | 25,489 | 25,366 | 25,209 | 24,268 | 19,054 | $ 8,131 | ||
Segregated Portfolio Cell Reinsurance | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 27,482 | 27,919 | 28,281 | 28,373 | 29,000 | 28,423 | 28,248 | |||
Incurred but Not Reported Liabilities (IBNR) | $ 188 | |||||||||
Cumulative Number of Reported Claims | claim | 4,433 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 27,110 | 27,083 | 26,959 | 26,810 | 26,173 | 21,880 | 9,933 | |||
Segregated Portfolio Cell Reinsurance | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 26,121 | 26,720 | 27,548 | 28,746 | 32,519 | 36,423 | ||||
Incurred but Not Reported Liabilities (IBNR) | $ 372 | |||||||||
Cumulative Number of Reported Claims | claim | 4,949 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 25,125 | 25,033 | 24,781 | 23,977 | 21,706 | 11,257 | ||||
Segregated Portfolio Cell Reinsurance | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 28,437 | 29,424 | 30,998 | 34,055 | 37,601 | |||||
Incurred but Not Reported Liabilities (IBNR) | $ 515 | |||||||||
Cumulative Number of Reported Claims | claim | 5,327 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 27,211 | 27,162 | 26,285 | 23,003 | 10,980 | |||||
Segregated Portfolio Cell Reinsurance | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 32,879 | 34,246 | 38,594 | 42,725 | ||||||
Incurred but Not Reported Liabilities (IBNR) | $ 775 | |||||||||
Cumulative Number of Reported Claims | claim | 5,706 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 31,140 | 28,853 | 24,791 | 12,404 | ||||||
Segregated Portfolio Cell Reinsurance | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 40,017 | 41,283 | 43,654 | |||||||
Incurred but Not Reported Liabilities (IBNR) | $ 2,979 | |||||||||
Cumulative Number of Reported Claims | claim | 6,373 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 33,236 | 27,501 | 12,517 | |||||||
Segregated Portfolio Cell Reinsurance | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 42,345 | 48,505 | ||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 6,461 | |||||||||
Cumulative Number of Reported Claims | claim | 6,081 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 29,604 | 15,100 | ||||||||
Segregated Portfolio Cell Reinsurance | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 40,094 | |||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 16,479 | |||||||||
Cumulative Number of Reported Claims | claim | 5,587 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 11,238 | |||||||||
Syndicate 1729 casualty | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 109,480 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 57,905 | |||||||||
All outstanding liabilities before 2011, net of reinsurance | 0 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 51,575 | |||||||||
Syndicate 1729 casualty | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 5,435 | 5,432 | 5,472 | 5,547 | 5,610 | 5,812 | 6,110 | |||
Incurred but Not Reported Liabilities (IBNR) | 333 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 4,852 | 4,580 | 4,320 | 4,214 | 4,092 | 474 | 20 | |||
Syndicate 1729 casualty | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 14,031 | 14,181 | 14,232 | 14,398 | 14,510 | 14,810 | ||||
Incurred but Not Reported Liabilities (IBNR) | 1,156 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 12,104 | 11,654 | 10,947 | 10,313 | 6,307 | 724 | ||||
Syndicate 1729 casualty | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 18,358 | 19,344 | 19,552 | 19,669 | 19,535 | |||||
Incurred but Not Reported Liabilities (IBNR) | 2,511 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 14,436 | 13,596 | 12,869 | 8,441 | 2,495 | |||||
Syndicate 1729 casualty | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 23,130 | 21,207 | 21,824 | 22,069 | ||||||
Incurred but Not Reported Liabilities (IBNR) | 4,502 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 14,990 | 12,871 | 8,301 | 2,611 | ||||||
Syndicate 1729 casualty | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 16,569 | 18,120 | 18,688 | |||||||
Incurred but Not Reported Liabilities (IBNR) | 7,181 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 6,710 | 4,905 | 1,852 | |||||||
Syndicate 1729 casualty | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 16,699 | 15,990 | ||||||||
Incurred but Not Reported Liabilities (IBNR) | 11,190 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 2,831 | 1,124 | ||||||||
Syndicate 1729 casualty | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 15,258 | |||||||||
Incurred but Not Reported Liabilities (IBNR) | 12,714 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 1,982 | |||||||||
Syndicate 1729 property insurance | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 98,821 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 77,470 | |||||||||
All outstanding liabilities before 2011, net of reinsurance | 0 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 21,351 | |||||||||
Syndicate 1729 property insurance | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 882 | 831 | 866 | 864 | 888 | 1,089 | 890 | |||
Incurred but Not Reported Liabilities (IBNR) | $ 8 | |||||||||
Cumulative Number of Reported Claims | claim | 68 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 860 | 860 | 857 | 854 | 836 | 1,005 | 267 | |||
Syndicate 1729 property insurance | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 5,215 | 5,886 | 6,159 | 6,194 | 5,917 | 5,519 | ||||
Incurred but Not Reported Liabilities (IBNR) | $ 61 | |||||||||
Cumulative Number of Reported Claims | claim | 538 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 5,117 | 5,018 | 4,869 | 4,808 | 4,022 | 3,165 | ||||
Syndicate 1729 property insurance | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 12,835 | 12,475 | 12,823 | 12,984 | 11,896 | |||||
Incurred but Not Reported Liabilities (IBNR) | $ 152 | |||||||||
Cumulative Number of Reported Claims | claim | 1,467 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 12,623 | 12,400 | 12,343 | 10,939 | 7,751 | |||||
Syndicate 1729 property insurance | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 19,866 | 19,976 | 17,634 | 15,018 | ||||||
Incurred but Not Reported Liabilities (IBNR) | $ 275 | |||||||||
Cumulative Number of Reported Claims | claim | 2,686 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 20,097 | 19,404 | 16,439 | 8,221 | ||||||
Syndicate 1729 property insurance | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 21,903 | 21,888 | 20,636 | |||||||
Incurred but Not Reported Liabilities (IBNR) | $ 307 | |||||||||
Cumulative Number of Reported Claims | claim | 3,612 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 19,769 | 17,248 | 9,918 | |||||||
Syndicate 1729 property insurance | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 19,664 | 18,010 | ||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 983 | |||||||||
Cumulative Number of Reported Claims | claim | 4,122 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 11,643 | 5,575 | ||||||||
Syndicate 1729 property insurance | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 18,456 | |||||||||
Incurred but Not Reported Liabilities (IBNR) | $ 3,411 | |||||||||
Cumulative Number of Reported Claims | claim | 2,848 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 7,361 | |||||||||
Syndicate 1729 property reinsurance | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 38,632 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 27,362 | |||||||||
All outstanding liabilities before 2011, net of reinsurance | 0 | |||||||||
Liabilities for losses and loss adjustment expenses, net of reinsurance | 11,270 | |||||||||
Syndicate 1729 property reinsurance | 2014 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 1,112 | 1,120 | 1,125 | 989 | 989 | 929 | 831 | |||
Incurred but Not Reported Liabilities (IBNR) | 0 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 1,112 | 1,120 | 1,125 | 984 | 984 | 917 | $ 79 | |||
Syndicate 1729 property reinsurance | 2015 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 2,455 | 2,377 | 2,328 | 2,275 | 2,825 | 2,788 | ||||
Incurred but Not Reported Liabilities (IBNR) | 59 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 2,303 | 2,267 | 2,234 | 1,996 | 1,804 | $ 1,313 | ||||
Syndicate 1729 property reinsurance | 2016 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 2,498 | 2,832 | 3,368 | 4,050 | 4,497 | |||||
Incurred but Not Reported Liabilities (IBNR) | 98 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 2,215 | 2,192 | 2,136 | 1,667 | $ 613 | |||||
Syndicate 1729 property reinsurance | 2017 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 7,947 | 6,868 | 7,832 | 6,861 | ||||||
Incurred but Not Reported Liabilities (IBNR) | 44 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 7,563 | 8,947 | 7,300 | $ 4,147 | ||||||
Syndicate 1729 property reinsurance | 2018 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 2,887 | 6,398 | 8,840 | |||||||
Incurred but Not Reported Liabilities (IBNR) | 590 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 1,663 | 1,644 | $ 547 | |||||||
Syndicate 1729 property reinsurance | 2019 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 13,333 | 10,977 | ||||||||
Incurred but Not Reported Liabilities (IBNR) | 1,704 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 8,575 | $ 4,974 | ||||||||
Syndicate 1729 property reinsurance | 2020 | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | 8,400 | |||||||||
Incurred but Not Reported Liabilities (IBNR) | 3,032 | |||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | $ 3,931 | |||||||||
Minimum | Healthcare Professional Liability claims-made | ||||||||||
Claims Development [Line Items] | ||||||||||
Initial loss ratio | 87.00% | |||||||||
Maximum | Healthcare Professional Liability claims-made | ||||||||||
Claims Development [Line Items] | ||||||||||
Initial loss ratio | 106.00% |
Reserve for Losses and Loss A_5
Reserve for Losses and Loss Adjustment Expenses - Historical Claims Duration (Details) | Dec. 31, 2020 |
Healthcare Professional Liability claims-made | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Historical claims duration, year 1 (percent) | 5.00% |
Historical claims duration, year 2 (percent) | 18.00% |
Historical claims duration, year 3 (percent) | 22.50% |
Historical claims duration, year 4 (percent) | 17.00% |
Historical claims duration, year 5 (percent) | 11.30% |
Historical claims duration, year 6 (percent) | 6.90% |
Historical claims duration, year 7 (percent) | 4.00% |
Historical claims duration, year 8 (percent) | 3.40% |
Historical claims duration, year 9 (percent) | 2.00% |
Historical claims duration, year 10 (percent) | 1.80% |
Healthcare Professional Liability occurrence | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Historical claims duration, year 1 (percent) | (2.60%) |
Historical claims duration, year 2 (percent) | 6.40% |
Historical claims duration, year 3 (percent) | 16.80% |
Historical claims duration, year 4 (percent) | 22.20% |
Historical claims duration, year 5 (percent) | 16.60% |
Historical claims duration, year 6 (percent) | 11.40% |
Historical claims duration, year 7 (percent) | 6.30% |
Historical claims duration, year 8 (percent) | 3.20% |
Historical claims duration, year 9 (percent) | 1.70% |
Historical claims duration, year 10 (percent) | 0.70% |
Medical technology liability | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Historical claims duration, year 1 (percent) | 3.60% |
Historical claims duration, year 2 (percent) | 21.20% |
Historical claims duration, year 3 (percent) | 21.00% |
Historical claims duration, year 4 (percent) | 11.60% |
Historical claims duration, year 5 (percent) | 15.20% |
Historical claims duration, year 6 (percent) | 3.00% |
Historical claims duration, year 7 (percent) | 3.90% |
Historical claims duration, year 8 (percent) | (0.40%) |
Historical claims duration, year 9 (percent) | 0.00% |
Historical claims duration, year 10 (percent) | 0.00% |
Workers' Compensation Insurance | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Historical claims duration, year 1 (percent) | 33.60% |
Historical claims duration, year 2 (percent) | 37.90% |
Historical claims duration, year 3 (percent) | 14.00% |
Historical claims duration, year 4 (percent) | 6.40% |
Historical claims duration, year 5 (percent) | 3.00% |
Historical claims duration, year 6 (percent) | 1.10% |
Historical claims duration, year 7 (percent) | 0.60% |
Historical claims duration, year 8 (percent) | 0.20% |
Historical claims duration, year 9 (percent) | 0.10% |
Historical claims duration, year 10 (percent) | 0.10% |
Segregated Portfolio Cell Reinsurance | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Historical claims duration, year 1 (percent) | 35.50% |
Historical claims duration, year 2 (percent) | 39.80% |
Historical claims duration, year 3 (percent) | 14.40% |
Historical claims duration, year 4 (percent) | 3.80% |
Historical claims duration, year 5 (percent) | 1.20% |
Historical claims duration, year 6 (percent) | 0.60% |
Historical claims duration, year 7 (percent) | (0.10%) |
Historical claims duration, year 8 (percent) | 0.00% |
Historical claims duration, year 9 (percent) | 0.10% |
Historical claims duration, year 10 (percent) | 0.00% |
Syndicate 1729 casualty | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Historical claims duration, year 1 (percent) | 3.20% |
Historical claims duration, year 2 (percent) | 17.50% |
Historical claims duration, year 3 (percent) | 24.50% |
Historical claims duration, year 4 (percent) | 18.40% |
Historical claims duration, year 5 (percent) | 11.90% |
Historical claims duration, year 6 (percent) | 8.50% |
Historical claims duration, year 7 (percent) | 5.80% |
Historical claims duration, year 8 (percent) | 3.70% |
Historical claims duration, year 9 (percent) | 2.00% |
Historical claims duration, year 10 (percent) | 0.30% |
Syndicate 1729 property insurance | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Historical claims duration, year 1 (percent) | 33.50% |
Historical claims duration, year 2 (percent) | 58.90% |
Historical claims duration, year 3 (percent) | 7.70% |
Historical claims duration, year 4 (percent) | 0.00% |
Historical claims duration, year 5 (percent) | 0.00% |
Historical claims duration, year 6 (percent) | 0.00% |
Historical claims duration, year 7 (percent) | 0.00% |
Historical claims duration, year 8 (percent) | 0.00% |
Historical claims duration, year 9 (percent) | 0.00% |
Historical claims duration, year 10 (percent) | 0.00% |
Syndicate 1729 property reinsurance | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Historical claims duration, year 1 (percent) | 37.80% |
Historical claims duration, year 2 (percent) | 49.10% |
Historical claims duration, year 3 (percent) | 13.00% |
Historical claims duration, year 4 (percent) | 0.10% |
Historical claims duration, year 5 (percent) | 0.00% |
Historical claims duration, year 6 (percent) | 0.00% |
Historical claims duration, year 7 (percent) | 0.00% |
Historical claims duration, year 8 (percent) | 0.00% |
Historical claims duration, year 9 (percent) | 0.00% |
Historical claims duration, year 10 (percent) | 0.00% |
Reserve for Losses and Loss A_6
Reserve for Losses and Loss Adjustment Expenses - Reconciliation of Claims Development (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities | $ 1,838,703 | |||
Total reinsurance recoverable on unpaid losses and loss adjustment expenses | 385,087 | $ 390,708 | $ 343,820 | $ 335,585 |
Reserve for the future utilization of the DDR benefit | 74,200 | |||
Unallocated loss adjustment expenses | 111,827 | |||
Loss portfolio transfers | 7,883 | |||
Other | (521) | |||
Liability for unpaid claims and claim adjustment expense | 193,389 | |||
Gross liability for losses and loss adjustment expenses | 2,417,179 | $ 2,346,526 | $ 2,119,847 | $ 2,048,381 |
Healthcare Professional Liability claims-made | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities | 1,207,246 | |||
Total reinsurance recoverable on unpaid losses and loss adjustment expenses | 190,378 | |||
Healthcare Professional Liability occurrence | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities | 215,920 | |||
Total reinsurance recoverable on unpaid losses and loss adjustment expenses | 43,241 | |||
Medical technology liability | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities | 31,207 | |||
Total reinsurance recoverable on unpaid losses and loss adjustment expenses | 30,701 | |||
Workers' Compensation Insurance | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities | 151,809 | |||
Total reinsurance recoverable on unpaid losses and loss adjustment expenses | 50,809 | |||
Segregated Portfolio Cell Reinsurance | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities | 53,704 | |||
Total reinsurance recoverable on unpaid losses and loss adjustment expenses | 25,182 | |||
Syndicate 1729 casualty | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities | 51,575 | |||
Total reinsurance recoverable on unpaid losses and loss adjustment expenses | 6,902 | |||
Syndicate 1729 property insurance | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities | 21,351 | |||
Total reinsurance recoverable on unpaid losses and loss adjustment expenses | 9,344 | |||
Syndicate 1729 property reinsurance | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities | 11,270 | |||
Total reinsurance recoverable on unpaid losses and loss adjustment expenses | 8,689 | |||
Other short-duration lines | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities | 94,621 | |||
Total reinsurance recoverable on unpaid losses and loss adjustment expenses | $ 19,841 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Oct. 31, 2020USD ($) | Jun. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2020GBP (£) | |
Forecast | NORCAL Group | ||||||
Other Commitment, Fiscal Year Maturity | ||||||
Base consideration | $ 450 | |||||
Contingent consideration (up to) | $ 150 | |||||
Lloyd's Syndicates | ||||||
Other Commitments [Line Items] | ||||||
Current lending capacity under revolving credit agreement | £ | £ 30,000,000 | |||||
Unused commitments | $ 41 | |||||
Non-renew notice, period | 30 days | |||||
Auto-renewal period prior to maturity date | 1 year | |||||
Interest rate on revolving credit agreement (percent) | 3.80% | 3.80% | ||||
FAL deposit assets | $ 106.2 | |||||
Syndicate 1729 | ||||||
Other Commitments [Line Items] | ||||||
Return of deposit assets | $ 32.3 | |||||
Proportion of capital provided to support Lloyd's syndicate (percent) | 29.00% | 29.00% | 61.00% | 29.00% | ||
Funding commitments | ||||||
Other Commitments [Line Items] | ||||||
Funding commitments related to non-public investment entities | $ 196.7 | |||||
Qualified affordable housing project | ||||||
Other Commitment, Fiscal Year Maturity | ||||||
Qualified affordable housing project funding commitments | 0.7 | |||||
Qualified affordable housing project funding commitments, due in 2021 | 0.3 | |||||
Qualified affordable housing project funding commitments, due in 2022 and 2023 | 0.3 | |||||
Qualified affordable housing project funding commitments, due in 2024 and 2025 | 0.1 | |||||
Data analytics services | ||||||
Other Commitment, Fiscal Year Maturity | ||||||
Period of long-term purchase commitment | 1 year | |||||
Contractual obligation, due in next year | $ 2.4 | |||||
Operating expense | 4.3 | $ 4.9 | ||||
Contractual obligation | $ 1.8 |
Leases - Narrative (Details)
Leases - Narrative (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Lessee, Lease, Description [Line Items] | |
Option to extend period | 15 years |
Option to terminate period | 1 year |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Lease terms | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Lease terms | 11 years |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Operating lease expense | $ 4,355 | $ 4,485 |
Sublease income | (143) | (152) |
Net lease expense | 4,212 | 4,333 |
Rental income | $ 2,500 | $ 2,500 |
Leases - Supplemental Lease Inf
Leases - Supplemental Lease Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Operating lease ROU assets | $ 19,013 | $ 21,074 |
Operating lease liabilities | $ 20,116 | $ 22,051 |
Weighted-average remaining lease term | 8 years 3 months 21 days | 8 years 8 months 26 days |
Weighted-average discount rate | 2.97% | 3.08% |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 127 | $ 976 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
2021 | $ 4,145 | |
2022 | 3,306 | |
2023 | 2,608 | |
2024 | 2,026 | |
2025 | 1,783 | |
Thereafter | 8,875 | |
Total future minimum lease payments | 22,743 | |
Less: Imputed interest | 2,627 | |
Total operating lease liabilities | $ 20,116 | $ 22,051 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||
Total principal | $ 286,113 | $ 287,617 |
Less unamortized debt issuance costs | 1,400 | 1,796 |
Debt less unamortized debt issuance costs | 284,713 | 285,821 |
Senior Notes | Senior notes due 2023 | ||
Debt Instrument [Line Items] | ||
Total principal | $ 250,000 | 250,000 |
Interest rate | 5.30% | |
Mortgage Loans | ||
Debt Instrument [Line Items] | ||
Total principal | $ 36,113 | $ 37,617 |
Mortgage Loans | Three month LIBOR | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate for debt | 1.325% | |
Interest rate | 1.58% | 3.21% |
Debt - Narrative (Details)
Debt - Narrative (Details) | 12 Months Ended | ||
Dec. 31, 2020USD ($)lender | Dec. 31, 2017USD ($) | Dec. 01, 2019USD ($) | |
Debt Instrument [Line Items] | |||
Number of participating lenders | lender | 7 | ||
Interest Rate Cap | |||
Debt Instrument [Line Items] | |||
Floor interest rate on derivative | 2.35% | ||
Other assets | Interest Rate Cap | |||
Debt Instrument [Line Items] | |||
Derivative asset, notional amount | $ 35,000,000 | ||
Senior Notes | Senior notes due 2023 | Base Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate for debt | 0.40% | ||
Line of Credit | Revolving Credit Agreement | |||
Debt Instrument [Line Items] | |||
Maximum allowable consolidated funded indebtedness ratio (percent) | 0.35 | ||
Line of credit facility, maximum borrowing | $ 300,000,000 | $ 250,000,000 | |
Additional borrowing capacity | 50,000,000 | ||
Minimum net worth required | $ 1,000,000,000 | ||
Line of Credit | Revolving Credit Agreement | Federal Funds Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate for debt | 0.50% | ||
Line of Credit | Revolving Credit Agreement | One month LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate for debt | 1.00% | ||
Line of Credit | Revolving Credit Agreement | Minimum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate for debt | 0.00% | ||
Commitment fee percentages (percent) | 0.15% | ||
Line of Credit | Revolving Credit Agreement | Maximum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate for debt | 1.88% | ||
Commitment fee percentages (percent) | 0.30% | ||
Mortgage Loans | |||
Debt Instrument [Line Items] | |||
Debt instrument term | 10 years | ||
Debt gross amount | $ 36,113,000 | $ 40,500,000 | |
Maximum allowable consolidated funded indebtedness ratio (percent) | 0.35 | ||
Mortgage Loans | Three month LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate for debt | 1.325% |
Debt - Schedule of Contractual
Debt - Schedule of Contractual Maturities of Mortgage Loans (Details) - Mortgage Loans - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
2021 | $ 1,559 | |
2022 | 1,617 | |
2023 | 1,677 | |
2024 | 1,740 | |
2025 | 1,805 | |
Thereafter | 27,715 | |
Total principal payments | $ 36,113 | $ 40,500 |
Shareholders' Equity - Narrativ
Shareholders' Equity - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Equity [Abstract] | ||||
Common shares authorized (in shares) | 100,000,000 | 100,000,000 | ||
Authorized preferred stock (in shares) | 50,000,000 | 50,000,000 | ||
Authorization common shares for the issuance under incentive compensation plans (in shares) | 1,600,000 | |||
Number of shares available for grant (in shares) | 500,000 | |||
Dividends declared | $ 24,800 | $ 66,700 | $ 94,300 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total Shareholders’ Equity | 1,349,210 | 1,511,913 | 1,523,002 | $ 1,594,795 |
Total authorizations which remain available for use | 109,600 | |||
OCI included deferred tax expense | 9,600 | $ 14,200 | $ (9,600) | |
Retained Earnings, Unappropriated | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total Shareholders’ Equity | $ 266,600 |
Shareholders' Equity - Changes
Shareholders' Equity - Changes in Common Shares (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Common Stock Outstanding Rollforward [Roll Forward] | |||
Beginning Balance (in shares) | 53,792 | 53,637 | 53,457 |
Shares issued due to vesting of share-based compensation awards (in shares) | 54 | 132 | 135 |
Other shares issued for compensation and shares reissued to stock purchase plan (in shares) | 47 | 23 | 45 |
Ending Balance (in shares) | 53,893 | 53,792 | 53,637 |
Shareholders' Equity - Cash Div
Shareholders' Equity - Cash Dividends Declared (Details) - $ / shares | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Class of Stock [Line Items] | |||||||||||||||
Cash dividends declared, per common share (in dollars per share) | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.46 | $ 1.24 | $ 1.74 |
Special Dividends | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Cash dividends declared, per common share (in dollars per share) | $ 0 | $ 0 | $ 0.50 |
Shareholders' Equity (Roll Forw
Shareholders' Equity (Roll Forward of AOCI) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | $ 1,511,913 | $ 1,523,002 | $ 1,594,795 | ||
OCI, before reclassifications, net of tax | 46,170 | 55,841 | (35,512) | ||
Amounts reclassified from AOCI, net of tax | (7,898) | (1,975) | 274 | ||
Net OCI, current period | 38,272 | 53,866 | (35,238) | ||
Ending balance | 1,349,210 | 1,511,913 | 1,523,002 | ||
Unrealized Investment Gains (Losses) | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | 37,333 | (16,733) | 15,453 | ||
OCI, before reclassifications, net of tax | 46,383 | 56,041 | (35,494) | ||
Amounts reclassified from AOCI, net of tax | (8,328) | (1,975) | (216) | ||
Net OCI, current period | 38,055 | 54,066 | (35,710) | ||
Ending balance | 75,388 | 37,333 | (16,733) | ||
Non-credit Impairments | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | (300) | (121) | (503) | ||
OCI, before reclassifications, net of tax | (187) | (179) | 0 | ||
Amounts reclassified from AOCI, net of tax | 430 | 0 | 490 | ||
Net OCI, current period | 243 | (179) | 490 | ||
Ending balance | (57) | (300) | (121) | ||
Unrecognized Change in Defined Benefit Plan Liabilities | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | (78) | (57) | (39) | ||
OCI, before reclassifications, net of tax | (26) | (21) | (18) | ||
Amounts reclassified from AOCI, net of tax | 0 | 0 | 0 | ||
Net OCI, current period | (26) | (21) | (18) | ||
Ending balance | (104) | (78) | (57) | ||
Accumulated Other Comprehensive Income (Loss) | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | 36,955 | (16,911) | 14,911 | ||
Ending balance | 75,227 | 36,955 | (16,911) | ||
Cumulative-effect adjustment | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | $ (4,076) | [1] | (444) | 3,416 | |
Ending balance | $ (4,076) | [1] | (444) | ||
Cumulative-effect adjustment | Unrealized Investment Gains (Losses) | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | 3,524 | ||||
Cumulative-effect adjustment | Non-credit Impairments | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | (108) | ||||
Cumulative-effect adjustment | Unrecognized Change in Defined Benefit Plan Liabilities | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | $ 0 | ||||
[1] | See Note 1 of the Notes to Consolidated Financial Statements for discussion of accounting guidance adopted during the year. |
Share-Based Payments - Narrativ
Share-Based Payments - Narrative (Details) | 12 Months Ended | ||
Dec. 31, 2020USD ($)award | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of award types (in award types) | award | 2 | ||
Restricted Stock and Performance Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected average period (years) | 3 years | ||
Restricted Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected average period (years) | 5 years | ||
Aggregate grant date fair value | $ 4,700,000 | $ 4,900,000 | $ 3,600,000 |
Aggregate intrinsic value | $ 2,600,000 | 4,600,000 | 4,100,000 |
Performance Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Aggregate grant date fair value | 2,700,000 | 4,500,000 | |
Aggregate intrinsic value | $ 2,600,000 | $ 5,000,000 | |
The percentage of award vest (percent) | 95.00% | 125.00% | |
Performance Share Units | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
The percentage of award vest (percent) | 50.00% | ||
Performance Share Units | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
The percentage of award vest (percent) | 200.00% | ||
Purchase Match Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected average period (years) | 3 years | ||
Aggregate grant date fair value | $ 2,200,000 | $ 1,100,000 | |
Aggregate intrinsic value | $ 1,700,000 | $ 1,100,000 | |
Annual contribution for the purchase of shares | $ 5,000 |
Share-Based Payments - Compensa
Share-Based Payments - Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Summary of compensation expense and related tax benefit recognized during each period and compensation cost expense in future periods | |||
Total share-based compensation expense | $ 3,840 | $ 3,527 | $ 5,321 |
Tax benefit recognized | 800 | $ 700 | $ 1,100 |
Unrecognized Compensation Cost, amount | $ 4,700 | ||
Weighted Average Remaining Recognition Period | 2 years 1 month 6 days |
Share-Based Payments - Restrict
Share-Based Payments - Restricted Share Units (Details) - Restricted Share Units - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Summary Activity for restricted share units, number of shares | |||
Beginning balance (in shares) | 320,625 | 267,323 | 269,520 |
Granted (in shares) | 111,758 | 164,196 | 85,797 |
Forfeited (in shares) | (9,054) | (3,832) | (3,878) |
Vested and released (in shares) | (83,525) | (107,062) | (84,116) |
Ending balance (in shares) | 339,804 | 320,625 | 267,323 |
Summary Activity for restricted share units, weighted average grant date fair value | |||
Beginning balance (in dollars per share) | $ 43.99 | $ 49.16 | $ 48.63 |
Granted (in dollars per share) | 29.18 | 36.96 | 44.73 |
Forfeited (in dollars per share) | 40.13 | 45.09 | 50.07 |
Vested and released (in dollars per share) | 56.74 | 46.06 | 42.90 |
Ending balance (in dollars per share) | $ 36.09 | $ 43.99 | $ 49.16 |
Share-Based Payments - Performa
Share-Based Payments - Performance Share Units (Details) - Performance Share Units - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Summary Activity for restricted share units, number of shares | |||
Beginning balance (in shares) | 100,370 | 135,202 | 212,105 |
Granted (in shares) | 38,609 | 25,168 | 27,202 |
Forfeited (in shares) | 0 | 0 | 0 |
Expired (in shares) | (48,000) | 0 | 0 |
Vested and released (in shares) | 0 | (60,000) | (104,105) |
Ending balance (in shares) | 90,979 | 100,370 | 135,202 |
Summary Activity for restricted share units, weighted average grant date fair value | |||
Beginning balance (in dollars per share) | $ 50.10 | $ 49.95 | $ 47.11 |
Granted (in dollars per share) | 29.18 | 40.18 | 44.73 |
Forfeited (in dollars per share) | 0 | 0 | 0 |
Expired (in dollars per share) | 58.35 | 0 | 0 |
Vested and released (in dollars per share) | 0 | 45.59 | 42.79 |
Ending balance (in dollars per share) | $ 36.87 | $ 50.10 | $ 49.95 |
Share-Based Payments - Purchase
Share-Based Payments - Purchase Match Units (Details) - Purchase Match Units - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Summary Activity for restricted share units, number of shares | |||
Beginning balance (in shares) | 0 | 44,682 | 70,292 |
Granted (in shares) | 0 | 0 | 0 |
Forfeited (in shares) | 0 | (1,400) | (1,594) |
Vested and released (in shares) | 0 | (43,282) | (24,016) |
Ending balance (in shares) | 0 | 0 | 44,682 |
Summary Activity for restricted share units, weighted average grant date fair value | |||
Beginning balance (in dollars per share) | $ 0 | $ 51.05 | $ 49.40 |
Granted (in dollars per share) | 0 | 0 | 0 |
Forfeited (in dollars per share) | 0 | 51.47 | 50.19 |
Vested and released (in dollars per share) | 0 | 51.03 | 46.28 |
Ending balance (in dollars per share) | $ 0 | $ 0 | $ 51.05 |
Variable Interest Entities (Det
Variable Interest Entities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Variable Interest Entity [Line Items] | ||
Assets | $ 4,654,803 | $ 4,805,599 |
Investment in unconsolidated subsidiaries | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Assets | $ 282,200 | $ 309,000 |
Earnings (Loss) Per Share (Deta
Earnings (Loss) Per Share (Details) - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average number of common shares outstanding, basic (in shares) | 53,863 | 53,740 | 53,598 |
Weighted average number of common shares outstanding, diluted (in shares) | 53,906 | 53,841 | 53,749 |
Effect of dilutive shares on earnings per share (in dollars per share) | $ 0 | $ 0 | $ 0 |
Antidilutive shares excluded from computation of earnings per share (in shares) | 114 | 0 | 2 |
Restricted Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dilutive securities (in shares) | 42 | 75 | 70 |
Performance Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dilutive securities (in shares) | 1 | 10 | 63 |
Purchase Match Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dilutive securities (in shares) | 0 | 16 | 18 |
Segment Information - Narrative
Segment Information - Narrative (Details) - segment | 12 Months Ended | ||
Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | |||
Number of reportable segments | 5 | ||
Number of operating segments | 5 | ||
Workers' Compensation Insurance | |||
Segment Reporting Information [Line Items] | |||
Alternative market solutions percentage ceded | 100.00% | ||
Syndicate 1729 | |||
Segment Reporting Information [Line Items] | |||
Proportion of capital provided to support Lloyd's syndicate (percent) | 29.00% | 29.00% | 61.00% |
Segment Information - Financial
Segment Information - Financial Data by Segment (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||||
Net premiums earned | $ 792,715,000 | $ 847,532,000 | $ 818,853,000 | ||
Net investment income | 71,998,000 | 93,269,000 | 91,884,000 | ||
Equity in earnings (loss) of unconsolidated subsidiaries | (11,921,000) | (10,061,000) | 8,948,000 | ||
Net realized gains (losses) | 15,678,000 | 59,874,000 | (43,488,000) | ||
Other income (expense) | 6,470,000 | 9,220,000 | 9,833,000 | ||
Net losses and loss adjustment expenses | (661,447,000) | (753,915,000) | (593,210,000) | ||
Underwriting, policy acquisition and operating expenses | (237,881,000) | (252,449,000) | (238,190,000) | ||
SPC U.S. federal income tax expense | (1,746,000) | (1,059,000) | (366,000) | ||
SPC dividend (expense) income | (14,304,000) | (4,579,000) | (9,122,000) | ||
Interest expense | (15,503,000) | (16,636,000) | (16,117,000) | ||
Income tax benefit (expense) | 41,329,000 | 29,808,000 | 18,032,000 | ||
Segment results | (14,612,000) | 1,004,000 | 47,057,000 | ||
Goodwill impairment | $ 0 | $ 161,100,000 | 161,115,000 | 0 | 0 |
Net income (loss) | (175,727,000) | 1,004,000 | 47,057,000 | ||
Depreciation and amortization, net of accretion | 21,375,000 | 18,665,000 | 21,255,000 | ||
Specialty P&C | |||||
Segment Reporting Information [Line Items] | |||||
Net premiums earned | 477,365,000 | 499,058,000 | 491,787,000 | ||
Workers' Compensation Insurance | |||||
Segment Reporting Information [Line Items] | |||||
Net premiums earned | 171,772,000 | 189,240,000 | 186,079,000 | ||
Segregated Portfolio Cell Reinsurance | |||||
Segment Reporting Information [Line Items] | |||||
Net premiums earned | 66,352,000 | 78,563,000 | 73,940,000 | ||
Lloyd's Syndicates | |||||
Segment Reporting Information [Line Items] | |||||
Net premiums earned | 77,226,000 | 80,671,000 | 67,047,000 | ||
Operating segments | Specialty P&C | |||||
Segment Reporting Information [Line Items] | |||||
Net premiums earned | 477,365,000 | 499,058,000 | 491,787,000 | ||
Net investment income | 0 | 0 | 0 | ||
Equity in earnings (loss) of unconsolidated subsidiaries | 0 | 0 | 0 | ||
Net realized gains (losses) | 0 | 0 | 0 | ||
Other income (expense) | 3,908,000 | 5,796,000 | 5,844,000 | ||
Net losses and loss adjustment expenses | (470,074,000) | (532,485,000) | (384,431,000) | ||
Underwriting, policy acquisition and operating expenses | (109,599,000) | (120,310,000) | (112,419,000) | ||
SPC U.S. federal income tax expense | 0 | 0 | 0 | ||
SPC dividend (expense) income | 0 | 0 | 0 | ||
Interest expense | 0 | 0 | 0 | ||
Income tax benefit (expense) | 0 | 0 | 0 | ||
Segment results | (98,400,000) | (147,941,000) | 781,000 | ||
Goodwill impairment | 0 | ||||
Depreciation and amortization, net of accretion | 7,747,000 | 6,586,000 | 7,050,000 | ||
Operating segments | Workers' Compensation Insurance | |||||
Segment Reporting Information [Line Items] | |||||
Net premiums earned | 171,772,000 | 189,240,000 | 186,079,000 | ||
Net investment income | 0 | 0 | 0 | ||
Equity in earnings (loss) of unconsolidated subsidiaries | 0 | 0 | 0 | ||
Net realized gains (losses) | 0 | 0 | 0 | ||
Other income (expense) | 2,216,000 | 2,399,000 | 2,412,000 | ||
Net losses and loss adjustment expenses | (111,552,000) | (121,649,000) | (118,483,000) | ||
Underwriting, policy acquisition and operating expenses | (56,449,000) | (57,520,000) | (55,693,000) | ||
SPC U.S. federal income tax expense | 0 | 0 | 0 | ||
SPC dividend (expense) income | 0 | 0 | 0 | ||
Interest expense | 0 | 0 | 0 | ||
Income tax benefit (expense) | 0 | 0 | 0 | ||
Segment results | 5,987,000 | 12,470,000 | 14,315,000 | ||
Goodwill impairment | 0 | ||||
Depreciation and amortization, net of accretion | 3,690,000 | 3,825,000 | 3,850,000 | ||
Operating segments | Segregated Portfolio Cell Reinsurance | |||||
Segment Reporting Information [Line Items] | |||||
Net premiums earned | 66,352,000 | 78,563,000 | 73,940,000 | ||
Net investment income | 1,084,000 | 1,578,000 | 1,566,000 | ||
Equity in earnings (loss) of unconsolidated subsidiaries | 0 | 0 | 0 | ||
Net realized gains (losses) | 3,085,000 | 4,020,000 | (3,149,000) | ||
Other income (expense) | 205,000 | 559,000 | 211,000 | ||
Net losses and loss adjustment expenses | (29,605,000) | (52,412,000) | (38,726,000) | ||
Underwriting, policy acquisition and operating expenses | (20,709,000) | (23,201,000) | (22,060,000) | ||
SPC U.S. federal income tax expense | (1,746,000) | (1,059,000) | (366,000) | ||
SPC dividend (expense) income | (14,304,000) | (4,579,000) | (9,122,000) | ||
Interest expense | 0 | 0 | 0 | ||
Income tax benefit (expense) | 0 | 0 | 0 | ||
Segment results | 4,362,000 | 3,469,000 | 2,294,000 | ||
Goodwill impairment | 0 | ||||
Depreciation and amortization, net of accretion | 676,000 | (41,000) | 441,000 | ||
Operating segments | Lloyd's Syndicates | |||||
Segment Reporting Information [Line Items] | |||||
Net premiums earned | 77,226,000 | 80,671,000 | 67,047,000 | ||
Net investment income | 4,128,000 | 4,551,000 | 3,358,000 | ||
Equity in earnings (loss) of unconsolidated subsidiaries | 0 | 0 | 0 | ||
Net realized gains (losses) | 988,000 | 768,000 | (460,000) | ||
Other income (expense) | 51,000 | (573,000) | 322,000 | ||
Net losses and loss adjustment expenses | (50,216,000) | (47,369,000) | (51,570,000) | ||
Underwriting, policy acquisition and operating expenses | (30,136,000) | (34,711,000) | (31,686,000) | ||
SPC U.S. federal income tax expense | 0 | 0 | 0 | ||
SPC dividend (expense) income | 0 | 0 | 0 | ||
Interest expense | 0 | 0 | 0 | ||
Income tax benefit (expense) | 29,000 | 0 | 317,000 | ||
Segment results | 2,070,000 | 3,337,000 | (12,672,000) | ||
Goodwill impairment | 0 | ||||
Depreciation and amortization, net of accretion | (4,000) | (7,000) | (8,000) | ||
Operating segments | Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Net premiums earned | 0 | 0 | 0 | ||
Net investment income | 66,786,000 | 87,140,000 | 86,960,000 | ||
Equity in earnings (loss) of unconsolidated subsidiaries | (11,921,000) | (10,061,000) | 8,948,000 | ||
Net realized gains (losses) | 11,605,000 | 55,086,000 | (39,879,000) | ||
Other income (expense) | 2,531,000 | 3,478,000 | 3,525,000 | ||
Net losses and loss adjustment expenses | 0 | 0 | 0 | ||
Underwriting, policy acquisition and operating expenses | (23,429,000) | (19,146,000) | (18,767,000) | ||
SPC U.S. federal income tax expense | 0 | 0 | 0 | ||
SPC dividend (expense) income | 0 | 0 | 0 | ||
Interest expense | (15,503,000) | (16,636,000) | (16,163,000) | ||
Income tax benefit (expense) | 41,300,000 | 29,808,000 | 17,715,000 | ||
Segment results | 71,369,000 | 129,669,000 | 42,339,000 | ||
Goodwill impairment | 0 | ||||
Depreciation and amortization, net of accretion | 9,266,000 | 8,302,000 | 9,922,000 | ||
Inter-segment Eliminations | |||||
Segment Reporting Information [Line Items] | |||||
Net premiums earned | 0 | 0 | 0 | ||
Net investment income | 0 | 0 | 0 | ||
Equity in earnings (loss) of unconsolidated subsidiaries | 0 | 0 | 0 | ||
Net realized gains (losses) | 0 | 0 | 0 | ||
Other income (expense) | (2,441,000) | (2,439,000) | (2,481,000) | ||
Net losses and loss adjustment expenses | 0 | 0 | 0 | ||
Underwriting, policy acquisition and operating expenses | 2,441,000 | 2,439,000 | 2,435,000 | ||
SPC U.S. federal income tax expense | 0 | 0 | 0 | ||
SPC dividend (expense) income | 0 | 0 | 0 | ||
Interest expense | 0 | 0 | 46,000 | ||
Income tax benefit (expense) | 0 | 0 | 0 | ||
Segment results | 0 | 0 | 0 | ||
Goodwill impairment | 0 | ||||
Depreciation and amortization, net of accretion | 0 | $ 0 | $ 0 | ||
Segment Reconciling Items | |||||
Segment Reporting Information [Line Items] | |||||
Goodwill impairment | $ 161,115,000 |
Segment Information - Gross Pre
Segment Information - Gross Premiums Earned by Product (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Ceded premiums earned | $ (113,582) | $ (124,171) | $ (126,036) |
Net premiums earned | 792,715 | 847,532 | 818,853 |
Specialty P&C Segment | |||
Segment Reporting Information [Line Items] | |||
Ceded premiums earned | (74,457) | (81,738) | (88,235) |
Net premiums earned | 477,365 | 499,058 | 491,787 |
Premiums assumed under Quota Share Agreement | 5,000 | ||
Specialty P&C Segment | HCPL | |||
Segment Reporting Information [Line Items] | |||
Gross premiums earned | 411,716 | 434,867 | 433,193 |
Specialty P&C Segment | Small business unit | |||
Segment Reporting Information [Line Items] | |||
Gross premiums earned | 104,376 | 109,876 | 111,204 |
Specialty P&C Segment | Medical technology liability | |||
Segment Reporting Information [Line Items] | |||
Gross premiums earned | 34,909 | 33,957 | 35,157 |
Specialty P&C Segment | Other | |||
Segment Reporting Information [Line Items] | |||
Gross premiums earned | 821 | 2,096 | 468 |
Workers' Compensation Insurance | |||
Segment Reporting Information [Line Items] | |||
Ceded premiums earned | (83,712) | (98,169) | (96,895) |
Net premiums earned | 171,772 | 189,240 | 186,079 |
Workers' Compensation Insurance | Traditional business | |||
Segment Reporting Information [Line Items] | |||
Gross premiums earned | 184,204 | 203,195 | 199,466 |
Workers' Compensation Insurance | Alternative market business | |||
Segment Reporting Information [Line Items] | |||
Gross premiums earned | 71,280 | 84,214 | 83,508 |
Segregated Portfolio Cell Reinsurance Segment | |||
Segment Reporting Information [Line Items] | |||
Ceded premiums earned | (8,760) | (9,741) | (9,324) |
Net premiums earned | 66,352 | 78,563 | 73,940 |
Segregated Portfolio Cell Reinsurance Segment | HCPL | |||
Segment Reporting Information [Line Items] | |||
Gross premiums earned | 6,594 | 6,059 | 5,009 |
Segregated Portfolio Cell Reinsurance Segment | Other | |||
Segment Reporting Information [Line Items] | |||
Gross premiums earned | 0 | 480 | 0 |
Segregated Portfolio Cell Reinsurance Segment | Workers' compensation | |||
Segment Reporting Information [Line Items] | |||
Gross premiums earned | 68,518 | 81,765 | 78,255 |
Lloyd's Syndicates Segment | |||
Segment Reporting Information [Line Items] | |||
Gross premiums earned | 98,990 | 101,222 | 83,307 |
Ceded premiums earned | (21,764) | (20,551) | (16,260) |
Net premiums earned | $ 77,226 | $ 80,671 | $ 67,047 |
Benefit Plans (Details)
Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Incurred expense related to savings and retirement plans | $ 5.5 | $ 7.2 | $ 7 |
ProAssurance deferred compensation liabilities total | $ 30.3 | $ 26.8 | |
Minimum | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Percentage of benefit plan contribution by employer (percent) | 5.00% | ||
Maximum | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Percentage of benefit plan contribution by employer (percent) | 10.00% |
Statutory Accounting and Divi_3
Statutory Accounting and Dividend Restrictions (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Insurance [Abstract] | |||
Statutory Net Income (Loss) | $ 81 | $ (22) | $ 135 |
Statutory Capital and Surplus | 831 | $ 878 | |
Net assets held at domestic insurance subsidiaries | 1,100 | ||
Statutory dividend payments permitted from insurance subsidiaries | $ 87 |
Schedule I - Summary of Inves_2
Schedule I - Summary of Investments - Other Than Investments In Related Parties (Details) $ in Thousands | Dec. 31, 2020USD ($) |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | $ 3,189,706 |
Fair Value | 3,389,345 |
Amount Which is Presented in the Balance Sheet | 3,389,345 |
U.S. Government or government agencies and authorities | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 134,567 |
Fair Value | 137,964 |
Amount Which is Presented in the Balance Sheet | 137,964 |
State and municipal bonds | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 316,022 |
Fair Value | 332,920 |
Amount Which is Presented in the Balance Sheet | 332,920 |
Foreign governments | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 30,591 |
Fair Value | 32,450 |
Amount Which is Presented in the Balance Sheet | 32,450 |
Public utilities | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 63,550 |
Fair Value | 67,251 |
Amount Which is Presented in the Balance Sheet | 67,251 |
All other corporate bonds | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 1,202,963 |
Fair Value | 1,259,016 |
Amount Which is Presented in the Balance Sheet | 1,259,016 |
Asset-backed securities | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 661,789 |
Fair Value | 676,386 |
Amount Which is Presented in the Balance Sheet | 676,386 |
Total Fixed Maturities | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 2,409,482 |
Fair Value | 2,505,987 |
Amount Which is Presented in the Balance Sheet | 2,505,987 |
Public utilities | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 290 |
Fair Value | 346 |
Amount Which is Presented in the Balance Sheet | 346 |
Banks, trusts and insurance companies | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 14,904 |
Fair Value | 13,810 |
Amount Which is Presented in the Balance Sheet | 13,810 |
Industrial, miscellaneous and all other | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 98,515 |
Fair Value | 105,945 |
Amount Which is Presented in the Balance Sheet | 105,945 |
Equity investments | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 113,709 |
Fair Value | 120,101 |
Amount Which is Presented in the Balance Sheet | 120,101 |
Other long-term investments | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 328,843 |
Fair Value | 425,444 |
Amount Which is Presented in the Balance Sheet | 425,444 |
Short-term investments | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Recorded Cost Basis | 337,672 |
Fair Value | 337,813 |
Amount Which is Presented in the Balance Sheet | $ 337,813 |
Schedule II - Condensed Finan_2
Schedule II - Condensed Financial Information of Registrant - Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||||
Fixed maturities available for sale, at fair value | $ 2,457,531 | $ 2,288,785 | ||
Short-term investments | 337,813 | 339,907 | ||
Investment in unconsolidated subsidiaries | 310,529 | 358,820 | ||
Cash and cash equivalents | 215,782 | 175,369 | ||
Other assets | 143,766 | 111,118 | ||
Total Assets | 4,654,803 | 4,805,599 | ||
Liabilities | ||||
Dividends declared and not yet paid | 2,694 | 16,676 | $ 43,446 | |
Other liabilities | 182,039 | 173,256 | ||
Debt less debt issuance costs | 284,713 | 285,821 | ||
Total Liabilities | 3,305,593 | 3,293,686 | ||
Shareholders’ Equity: | ||||
Common stock | 632 | 631 | ||
Total Shareholders’ Equity | 1,349,210 | 1,511,913 | 1,523,002 | $ 1,594,795 |
Total Liabilities and Shareholders' Equity | 4,654,803 | 4,805,599 | ||
Parent Company | ||||
Assets | ||||
Investment in subsidiaries, at equity | 1,383,527 | 1,534,367 | ||
Fixed maturities available for sale, at fair value | 33,824 | 85,263 | ||
Short-term investments | 115,198 | 63,992 | ||
Investment in unconsolidated subsidiaries | 915 | 915 | ||
Cash and cash equivalents | 55,469 | 65,956 | ||
Other assets | 28,778 | 40,640 | ||
Total Assets | 1,617,711 | 1,791,133 | ||
Liabilities | ||||
Due to subsidiaries | 10,696 | 9,899 | ||
Dividends declared and not yet paid | 2,694 | 16,676 | $ 43,446 | |
Other liabilities | 6,361 | 4,268 | ||
Debt less debt issuance costs | 248,750 | 248,377 | ||
Total Liabilities | 268,501 | 279,220 | ||
Shareholders’ Equity: | ||||
Common stock | 632 | 631 | ||
Other shareholders’ equity, including unrealized gains (losses) on securities of subsidiaries | 1,348,578 | 1,511,282 | ||
Total Shareholders’ Equity | 1,349,210 | 1,511,913 | ||
Total Liabilities and Shareholders' Equity | $ 1,617,711 | $ 1,791,133 |
Schedule II - Condensed Finan_3
Schedule II - Condensed Financial Information of Registrant - Statements of Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues | |||
Net investment income | $ 71,998 | $ 93,269 | $ 91,884 |
Equity in earnings (loss) of unconsolidated subsidiaries | (11,921) | (10,061) | 8,948 |
Net realized investment gains (losses) | 15,678 | 59,874 | (43,488) |
Other income (loss) | 6,470 | 9,220 | 9,833 |
Total revenues | 874,940 | 999,834 | 886,030 |
Expenses | |||
Interest expense | 15,503 | 16,636 | 16,117 |
Total expenses | 1,091,996 | 1,028,638 | 857,005 |
Income tax expense (benefit) | (41,329) | (29,808) | (18,032) |
Net income (loss) | (175,727) | 1,004 | 47,057 |
Other comprehensive income (loss) | 38,272 | 53,866 | (35,238) |
Comprehensive income (loss) | (137,455) | 54,870 | 11,819 |
Parent Company | |||
Revenues | |||
Net investment income | 331 | 2,694 | 3,495 |
Equity in earnings (loss) of unconsolidated subsidiaries | 0 | 40 | (325) |
Net realized investment gains (losses) | 2,194 | 19 | (789) |
Other income (loss) | 12 | 795 | 977 |
Total revenues | 2,537 | 3,548 | 3,358 |
Expenses | |||
Interest expense | 14,260 | 14,074 | 14,844 |
Other expenses | 21,458 | 16,653 | 17,092 |
Total expenses | 35,718 | 30,727 | 31,936 |
Income (loss) before income tax expense (benefit) and equity in net income (loss) of consolidated subsidiaries | (33,181) | (27,179) | (28,578) |
Income tax expense (benefit) | 11,404 | (28,455) | (7,142) |
Income (loss) before equity in net income (loss) of consolidated subsidiaries | (44,585) | 1,276 | (21,436) |
Equity in net income (loss) of consolidated subsidiaries | (131,142) | (272) | 68,493 |
Net income (loss) | (175,727) | 1,004 | 47,057 |
Other comprehensive income (loss) | 38,272 | 53,866 | (35,238) |
Comprehensive income (loss) | $ (137,455) | $ 54,870 | $ 11,819 |
Schedule II - Condensed Finan_4
Schedule II - Condensed Financial Information of Registrant - Cash Flow (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net cash provided (used) by operating activities | $ 92,343 | $ 148,166 | $ 177,265 |
Proceeds from sales or maturities of: | |||
Fixed maturities, available for sale | 801,580 | 568,572 | 914,021 |
Net decrease (increase) in short-term investments | 2,361 | (30,718) | 123,886 |
Contribution of capital to subsidiaries | (97,541) | 0 | 0 |
Other | (2,010) | (5) | (1,305) |
Net cash provided (used) by investing activities | (8,484) | 50,522 | 214,897 |
Financing Activities | |||
Repayments under Revolving Credit Agreement | 0 | 0 | (123,000) |
Dividends to shareholders | (38,664) | (93,204) | (316,476) |
Other | (935) | (4,115) | (4,309) |
Net cash provided (used) by financing activities | (43,446) | (103,790) | (446,186) |
Increase (decrease) in cash and cash equivalents | 40,413 | 94,898 | (54,024) |
Cash and cash equivalents at beginning of period | 175,369 | 80,471 | 134,495 |
Cash and cash equivalents at end of period | 215,782 | 175,369 | 80,471 |
Supplemental Disclosure of Cash Flow Information | |||
Cash paid during the year for income taxes, net of refunds | (8,832) | 2,748 | 5,726 |
Cash paid during the year for interest | 14,712 | 14,294 | 16,165 |
Significant non-cash transactions: | |||
Dividends declared and not yet paid | 2,694 | 16,676 | 43,446 |
Parent Company | |||
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net cash provided (used) by operating activities | (21,450) | 20,055 | 27,981 |
Proceeds from sales or maturities of: | |||
Fixed maturities, available for sale | 87,101 | 27,974 | 169,822 |
Net decrease (increase) in short-term investments | (51,206) | 12,603 | 194,035 |
Dividends from subsidiaries | 79,486 | 52,499 | 29,395 |
Funds (advanced) repaid for Lloyd's FAL deposit | 32,256 | (4,894) | (21,576) |
Funds (advanced) repaid under Syndicate Credit Agreement | 0 | 30,296 | (11,232) |
Other | (2,206) | (936) | 330 |
Net cash provided (used) by investing activities | 47,890 | 117,542 | 360,774 |
Financing Activities | |||
Repayments under Revolving Credit Agreement | 0 | 0 | (123,000) |
Subsidiary payments for common shares and share-based compensation awarded to subsidiary employees | 2,846 | 344 | 1,154 |
Dividends to shareholders | (38,664) | (93,204) | (316,476) |
Other | (1,109) | (4,538) | (5,685) |
Net cash provided (used) by financing activities | (36,927) | (97,398) | (444,007) |
Increase (decrease) in cash and cash equivalents | (10,487) | 40,199 | (55,252) |
Cash and cash equivalents at beginning of period | 65,956 | 25,757 | 81,009 |
Cash and cash equivalents at end of period | 55,469 | 65,956 | 25,757 |
Supplemental Disclosure of Cash Flow Information | |||
Cash paid during the year for income taxes, net of refunds | (9,117) | 2,053 | 4,966 |
Cash paid during the year for interest | 13,888 | 13,699 | 14,777 |
Significant non-cash transactions: | |||
Dividends declared and not yet paid | 2,694 | 16,676 | 43,446 |
Securities transferred at fair value as dividends from subsidiaries | $ 34,915 | $ 34,897 | $ 98,292 |
Schedule III - Supplementary _2
Schedule III - Supplementary Insurance Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Net premiums earned | $ 792,715 | $ 847,532 | $ 818,853 |
Net investment income | 71,998 | 93,269 | 91,884 |
Losses and loss adjustment expenses incurred related to current year, net of reinsurance | 711,846 | 765,698 | 685,326 |
Losses and loss adjustment expenses incurred related to prior year, net of reinsurance | (50,399) | (11,783) | (92,116) |
Paid losses and loss adjustment expenses, net of reinsurance | 585,173 | 574,124 | 529,979 |
Amortization of DPAC | 110,565 | 115,330 | 104,501 |
Other underwriting, policy acquisition and operating expenses | 127,316 | 137,119 | 133,689 |
Net premiums written | 747,701 | 842,725 | 834,914 |
Deferred policy acquisition costs | 47,196 | 55,567 | 54,116 |
Reserve for losses and loss adjustment expenses | 2,417,179 | 2,346,526 | 2,119,847 |
Unearned premiums | 361,547 | 413,086 | 415,211 |
SPC U.S. federal income tax expense | 1,746 | 1,059 | 366 |
Specialty P&C | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Net premiums earned | 477,365 | 499,058 | 491,787 |
Losses and loss adjustment expenses incurred related to current year, net of reinsurance | 497,554 | 526,744 | 461,516 |
Losses and loss adjustment expenses incurred related to prior year, net of reinsurance | (27,480) | 5,741 | (77,085) |
Net premiums written | 451,019 | 495,750 | 494,148 |
Workers' Compensation Insurance | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Net premiums earned | 171,772 | 189,240 | 186,079 |
Losses and loss adjustment expenses incurred related to current year, net of reinsurance | 118,523 | 129,450 | 126,534 |
Losses and loss adjustment expenses incurred related to prior year, net of reinsurance | (6,971) | (7,801) | (8,051) |
Net premiums written | 164,871 | 182,233 | 195,350 |
Segregated Portfolio Cell Reinsurance | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Net premiums earned | 66,352 | 78,563 | 73,940 |
Net investment income | 1,084 | 1,578 | 1,566 |
Losses and loss adjustment expenses incurred related to current year, net of reinsurance | 46,200 | 62,546 | 47,693 |
Losses and loss adjustment expenses incurred related to prior year, net of reinsurance | (16,595) | (10,134) | (8,967) |
Net premiums written | 64,159 | 77,639 | 75,547 |
Lloyd's Syndicates | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Net premiums earned | 77,226 | 80,671 | 67,047 |
Net investment income | 4,128 | 4,551 | 3,358 |
Losses and loss adjustment expenses incurred related to current year, net of reinsurance | 49,569 | 46,958 | 49,583 |
Losses and loss adjustment expenses incurred related to prior year, net of reinsurance | 647 | 411 | 1,987 |
Net premiums written | 67,652 | 87,103 | 69,869 |
Corporate | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Net investment income | 66,786 | 87,140 | 86,960 |
Operating segments | Specialty P&C | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Paid losses and loss adjustment expenses, net of reinsurance | 379,656 | 382,845 | 354,221 |
Amortization of DPAC | 53,562 | 56,605 | 52,253 |
Other underwriting, policy acquisition and operating expenses | 56,037 | 63,705 | 60,166 |
SPC U.S. federal income tax expense | 0 | 0 | 0 |
Operating segments | Workers' Compensation Insurance | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Paid losses and loss adjustment expenses, net of reinsurance | 118,496 | 117,848 | 108,742 |
Amortization of DPAC | 15,895 | 17,144 | 16,864 |
Other underwriting, policy acquisition and operating expenses | 40,554 | 40,376 | 38,829 |
SPC U.S. federal income tax expense | 0 | 0 | 0 |
Operating segments | Segregated Portfolio Cell Reinsurance | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Paid losses and loss adjustment expenses, net of reinsurance | 46,267 | 37,034 | 29,320 |
Amortization of DPAC | 19,636 | 21,717 | 21,039 |
Other underwriting, policy acquisition and operating expenses | 1,073 | 1,484 | 1,021 |
SPC U.S. federal income tax expense | 1,746 | 1,059 | 366 |
Operating segments | Lloyd's Syndicates | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Paid losses and loss adjustment expenses, net of reinsurance | 40,897 | 36,593 | 37,496 |
Amortization of DPAC | 21,597 | 21,392 | 15,913 |
Other underwriting, policy acquisition and operating expenses | 8,539 | 13,319 | 15,773 |
SPC U.S. federal income tax expense | 0 | 0 | 0 |
Operating segments | Corporate | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Other underwriting, policy acquisition and operating expenses | 23,429 | 19,146 | 18,767 |
SPC U.S. federal income tax expense | 0 | 0 | 0 |
Inter-segment Eliminations | |||
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Line Items] | |||
Paid losses and loss adjustment expenses, net of reinsurance | (143) | (196) | 200 |
Amortization of DPAC | (125) | (1,528) | (1,568) |
Other underwriting, policy acquisition and operating expenses | (2,316) | (911) | (867) |
SPC U.S. federal income tax expense | $ 0 | $ 0 | $ 0 |
Schedule IV - Reinsurance (Deta
Schedule IV - Reinsurance (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property and Liability | |||
Premiums earned | $ 862,742 | $ 926,035 | $ 903,354 |
Premiums ceded | (113,582) | (124,171) | (126,036) |
Premiums assumed | 43,555 | 45,668 | 41,535 |
Net premiums earned | $ 792,715 | $ 847,532 | $ 818,853 |
Percentage of amount assumed to net | 5.49% | 5.39% | 5.07% |