Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2022 shares | |
Document Information | |
Entity Registrant Name | FAIRFAX FINANCIAL HOLDINGS LTD/ CAN |
Document Type | 40-F |
Document Registration Statement | false |
Document Annual Report | true |
Document Period End Date | Dec. 31, 2022 |
Current Fiscal Year End Date | --12-31 |
Entity File Number | 1-31556 |
Entity Primary SIC Number | 6331 |
Entity Incorporation, State or Country Code | Z4 |
Entity Tax Identification Number | 00-0000000 |
Entity Address, Address Line One | 95 Wellington Street West |
Entity Address, Address Line Two | Suite 800 |
Entity Address, City or Town | Toronto |
Entity Address, State or Province | ON |
Entity Address, Country | CA |
Entity Address, Postal Zip Code | M5J 2N7 |
City Area Code | 416 |
Local Phone Number | 367-4941 |
Annual Information Form | true |
Audited Annual Financial Statements | true |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Emerging Growth Company | false |
ICFR Auditor Attestation Flag | true |
Entity Central Index Key | 0000915191 |
Document Fiscal Year Focus | 2022 |
Document Fiscal Period Focus | FY |
Amendment Flag | false |
Auditor Name | PricewaterhouseCoopers LLP |
Auditor Location | Toronto, Canada |
Auditor Firm ID | 271 |
Fairfax subordinate voting shares | |
Document Information | |
Entity Common Stock, Shares Outstanding | 22,576,535 |
Multiple voting shares | |
Document Information | |
Entity Common Stock, Shares Outstanding | 1,548,000 |
Business Contact | |
Document Information | |
Contact Personnel Name | CT Corporation System |
Entity Address, Address Line One | 111 Eighth Avenue |
Entity Address, Address Line Two | 13th Floor |
Entity Address, City or Town | New York |
Entity Address, State or Province | NY |
Entity Address, Postal Zip Code | 10011 |
City Area Code | 212 |
Local Phone Number | 894-8700 |
Consolidated Balance Sheets
Consolidated Balance Sheets $ in Millions, $ in Millions | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) |
Assets | ||
Holding company cash and investments (including assets pledged for derivative obligations - $104.6; December 31, 2021 - $111.0) | $ 1,345.8 | $ 1,478.3 |
Insurance contract receivables | 7,907.5 | 6,883.2 |
Portfolio investments | ||
Subsidiary cash and short term investments (including restricted cash and cash equivalents - $854.4; December 31, 2021 - $1,246.4) | 9,368.2 | 21,799.5 |
Bonds (cost $29,534.4; December 31, 2021 - $13,836.3) | 28,578.5 | 14,091.2 |
Preferred stocks (cost $808.3; December 31, 2021 - $576.6) | 2,338 | 2,405.9 |
Common stocks (cost $5,162.6; December 31, 2021 - $4,717.2) | 5,124.3 | 5,468.9 |
Investments in associates (fair value $6,772.9; December 31, 2021 - $5,671.9) | 6,091.3 | 4,755.1 |
Derivatives and other invested assets (cost $869.8; December 31, 2021 - $888.2) | 828.5 | 991.2 |
Assets pledged for derivative obligations (cost $52.4; December 31, 2021 - $119.6) | 51.3 | 119.6 |
Fairfax India cash, portfolio investments and associates (fair value $3,079.6; December 31, 2021 - $3,336.4) | 1,942.8 | 2,066 |
Total portfolio investments | 54,322.9 | 51,697.4 |
Deferred premium acquisition costs | 2,170.3 | 1,924.1 |
Recoverable from reinsurers (including recoverables on paid losses - $1,454.2; December 31, 2021 - $884.3) | 13,115.8 | 12,090.5 |
Deferred income tax assets | 492.1 | 522.4 |
Goodwill and intangible assets | 5,689 | 5,928.2 |
Other assets | 7,081.7 | 6,121.3 |
Total assets | 92,125.1 | 86,645.4 |
Liabilities | ||
Accounts payable and accrued liabilities | 5,215.2 | 4,985.4 |
Derivative obligations (including at the holding company - $19.4; December 31, 2021 - $32.1) | 191 | 152.9 |
Deferred income tax liabilities | 496.7 | 598.8 |
Insurance contract payables | 5,061.9 | 4,493.5 |
Insurance contract liabilities | 52,199.6 | 47,346.5 |
Borrowings | 8,624.9 | 7,753 |
Total liabilities | 71,789.3 | 65,330.1 |
Equity | ||
Shareholders' equity attributable to shareholders of Fairfax | 16,676.2 | 16,385.1 |
Non-controlling interests | 3,659.6 | 4,930.2 |
Total equity | 20,335.8 | 21,315.3 |
Total liabilities and total equity | 92,125.1 | 86,645.4 |
Common shares | ||
Equity | ||
Equity in stock | 15,340.7 | 15,049.6 |
Preferred shares | ||
Equity | ||
Equity in stock | 1,335.5 | 1,335.5 |
Holding company and insurance and reinsurance companies | ||
Liabilities | ||
Borrowings | 6,621 | 6,129.3 |
Non-insurance companies | ||
Liabilities | ||
Borrowings | $ 2,003.9 | $ 1,623.7 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Consolidated Balance Sheets | ||
Restricted cash and cash equivalents | $ 861.2 | $ 1,261 |
Recoverables on paid losses | 1,454.2 | 884.3 |
Derivative obligations, holding company | 19.4 | 32.1 |
Holding company cash and investments | ||
Consolidated Balance Sheets | ||
Cash and investments pledged for derivative obligations | 104.6 | 111 |
Portfolio investments | ||
Consolidated Balance Sheets | ||
Restricted cash and cash equivalents | 854.4 | 1,246.4 |
Bonds, at cost | 29,534.4 | 13,836.3 |
Preferred stocks, at cost | 808.3 | 576.6 |
Common stocks, at cost | 5,162.6 | 4,717.2 |
Investments in associates, at fair value | 6,772.9 | 5,671.9 |
Derivatives and other invested assets, at cost | 869.8 | 888.2 |
Assets pledged for derivative obligations, at cost | 52.4 | 119.6 |
Portfolio investments | Fairfax India | ||
Consolidated Balance Sheets | ||
Fairfax India cash, portfolio investments and associates, at fair value | $ 3,079.6 | $ 3,336.4 |
Consolidated Statements of Earn
Consolidated Statements of Earnings - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income | ||
Gross premiums earned | $ 26,454.9 | $ 21,786.8 |
Premiums ceded to reinsurers | (5,448.8) | (5,228.8) |
Net premiums earned | 21,006.1 | 16,558 |
Interest and dividends | 961.8 | 640.8 |
Share of profit of associates | 1,014.7 | 402 |
Net gains (losses) on investments | (1,733.9) | 3,445.1 |
Gain on sale and consolidation of insurance subsidiaries | 1,219.7 | 264 |
Other revenue | 5,581.6 | 5,158 |
Income | 28,050 | 26,467.9 |
Expenses | ||
Losses on claims, gross | 17,509.5 | 14,200.7 |
Losses on claims, ceded to reinsurers | (3,657.6) | (3,460.2) |
Losses on claims, net | 13,851.9 | 10,740.5 |
Operating expenses | 3,057.5 | 2,946.1 |
Commissions, net | 3,454.9 | 2,787.9 |
Interest expense | 452.8 | 513.9 |
Other expenses | 5,520.9 | 5,086.9 |
Expenses | 26,338 | 22,075.3 |
Earnings before income taxes | 1,712 | 4,392.6 |
Provision for income taxes | 425.2 | 726 |
Net earnings (loss) | 1,286.8 | 3,666.6 |
Attributable to: | ||
Shareholders of Fairfax | 1,147.2 | 3,401.1 |
Non-controlling interests | 139.6 | 265.5 |
Net earnings (loss) | $ 1,286.8 | $ 3,666.6 |
Net earnings per share (in dollars per share) | $ 46.62 | $ 129.33 |
Net earnings per diluted share (in dollars per share) | 43.49 | 122.25 |
Cash dividends paid per share (in dollars per share) | $ 10 | $ 10 |
Shares outstanding (000) (weighted average) (in shares) | 23,637,824 | 25,953,114 |
Consolidated Statements of Ea_2
Consolidated Statements of Earnings (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Consolidated Statements of Earnings | ||
Gross premiums written | $ 27,912.6 | $ 23,910.2 |
Net premiums written | $ 22,271.7 | $ 18,278.1 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Statement | ||
Net earnings | $ 1,286.8 | $ 3,666.6 |
Items that may be subsequently reclassified to net earnings | ||
Net unrealized foreign currency translation losses on foreign subsidiaries | (673.7) | (199.5) |
Share of other comprehensive loss of associates, excluding net gains on defined benefit plans | (132) | (75.1) |
Other | 2.2 | |
Items that may be subsequently reclassified to net earnings (loss) before reclassification adjustments | (602.2) | (227.4) |
Net unrealized foreign currency translation losses on foreign subsidiaries reclassified to net earnings | 19.7 | 6.7 |
Net unrealized foreign currency translation gains on associates reclassified to net earnings | (4.3) | (45.2) |
Items that may be subsequently reclassified to net earnings (loss) | (586.8) | (265.9) |
Items that will not be subsequently reclassified to net earnings | ||
Net gains on defined benefit plans | 121.7 | 88.2 |
Share of net gains on defined benefit plans of associates | 59.4 | 67 |
Other | 13.8 | |
Items that will not be subsequently reclassified to net earnings (loss) | 181.1 | 169 |
Other comprehensive income (loss), net of income taxes | (405.7) | (96.9) |
Comprehensive income | 881.1 | 3,569.7 |
Attributable to: | ||
Shareholders of Fairfax | 939.8 | 3,377.6 |
Non-controlling interests | (58.7) | 192.1 |
Comprehensive income | 881.1 | 3,569.7 |
Canada | ||
Statement | ||
Net earnings | 284.5 | 667.2 |
Items that may be subsequently reclassified to net earnings | ||
Gains (losses) on hedge of net investment | 149.5 | (16.7) |
Europe | ||
Items that may be subsequently reclassified to net earnings | ||
Gains (losses) on hedge of net investment | $ 51.8 | $ 63.9 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) $ in Millions | Issued capital Common shares | Issued capital Preferred shares | Treasury shares at cost | Share- based payments and other reserves | Retained earnings | Accumulated other comprehensive income (loss) Canada | Accumulated other comprehensive income (loss) Europe | Accumulated other comprehensive income (loss) | Common shareholders' equity Canada | Common shareholders' equity Europe | Common shareholders' equity | Equity attributable to shareholders of Fairfax Canada | Equity attributable to shareholders of Fairfax Europe | Equity attributable to shareholders of Fairfax | Non-controlling interests | Preferred shares | Canada | Europe | Total |
Beginning balance at Dec. 31, 2020 | $ 6,712 | $ 1,335.5 | $ (732.8) | $ 248.4 | $ 7,092.5 | $ (799) | $ 12,521.1 | $ 13,856.6 | $ 3,670.7 | $ 17,527.3 | |||||||||
Changes in equity | |||||||||||||||||||
Net earnings for the year | 3,401.1 | 3,401.1 | 3,401.1 | 265.5 | $ 667.2 | 3,666.6 | |||||||||||||
Net unrealized foreign currency translation losses on foreign operations | (123.3) | (123.3) | (123.3) | (76.2) | (199.5) | ||||||||||||||
Gains on hedge of net investment | $ (16.7) | $ 63.9 | $ (16.7) | $ 63.9 | $ (16.7) | $ 63.9 | (16.7) | $ 63.9 | |||||||||||
Share of other comprehensive loss of associates, excluding net gains on defined benefit plans | (65.2) | (65.2) | (65.2) | (9.9) | (75.1) | ||||||||||||||
Net unrealized foreign currency translation losses on foreign subsidiaries reclassified to net earnings | 3.1 | 3.1 | 3.1 | 3.6 | 6.7 | ||||||||||||||
Net unrealized foreign currency translation gains on associates reclassified to net earnings | (45.6) | (45.6) | (45.6) | 0.4 | (45.2) | ||||||||||||||
Net gains on defined benefit plans | 82.8 | 82.8 | 82.8 | 5.4 | 88.2 | ||||||||||||||
Share of net gains on defined benefit plans of associates | 68.3 | 68.3 | 68.3 | (1.3) | 67 | ||||||||||||||
Other | 9.2 | 9.2 | 9.2 | 4.6 | 13.8 | ||||||||||||||
Issuances for share-based payments | 57.3 | (56.1) | 1.2 | 1.2 | (3) | (1.8) | |||||||||||||
Purchases and amortization for share-based payments | (132.6) | 104.1 | (28.5) | (28.5) | 6.8 | (21.7) | |||||||||||||
Purchases for cancellation | (529.6) | (528.5) | (1,058.1) | (1,058.1) | (1,058.1) | ||||||||||||||
Common share dividends | (272.1) | (272.1) | (272.1) | (155.4) | (427.5) | ||||||||||||||
Preferred share dividends | (44.5) | (44.5) | (44.5) | $ (44.5) | (44.5) | ||||||||||||||
Acquisitions of subsidiaries | 7.5 | 7.5 | |||||||||||||||||
Net changes in capitalization | 208.4 | 323.7 | 20.8 | 552.9 | 552.9 | 1,226.9 | 1,779.8 | ||||||||||||
Deconsolidation of subsidiaries | (15.4) | (15.4) | |||||||||||||||||
Ending balance at Dec. 31, 2021 | 6,182.4 | 1,335.5 | (808.1) | 504.8 | 9,972.2 | (801.7) | 15,049.6 | 16,385.1 | 4,930.2 | 21,315.3 | |||||||||
Changes in equity | |||||||||||||||||||
Net earnings for the year | 1,147.2 | 1,147.2 | 1,147.2 | 139.6 | 284.5 | 1,286.8 | |||||||||||||
Net unrealized foreign currency translation losses on foreign operations | (479.7) | (479.7) | (479.7) | (194) | (673.7) | ||||||||||||||
Gains on hedge of net investment | $ 149.5 | $ 51.8 | $ 149.5 | $ 51.8 | $ 149.5 | $ 51.8 | $ 149.5 | $ 51.8 | |||||||||||
Share of other comprehensive loss of associates, excluding net gains on defined benefit plans | (120.7) | (120.7) | (120.7) | (11.3) | (132) | ||||||||||||||
Net unrealized foreign currency translation losses on foreign subsidiaries reclassified to net earnings | 19.7 | 19.7 | 19.7 | 19.7 | |||||||||||||||
Net unrealized foreign currency translation gains on associates reclassified to net earnings | (3.9) | (3.9) | (3.9) | (0.4) | (4.3) | ||||||||||||||
Net gains on defined benefit plans | 116.9 | 116.9 | 116.9 | 4.8 | 121.7 | ||||||||||||||
Share of net gains on defined benefit plans of associates | 57.8 | 57.8 | 57.8 | 1.6 | 59.4 | ||||||||||||||
Other | 1.2 | 1.2 | 1.2 | 1 | 2.2 | ||||||||||||||
Issuances for share-based payments | 62.4 | (70.2) | (7.8) | (7.8) | 5.3 | (2.5) | |||||||||||||
Purchases and amortization for share-based payments | (148.2) | 146.1 | (2.1) | (2.1) | (20.3) | (22.4) | |||||||||||||
Purchases for cancellation | (96.1) | (103.5) | (199.6) | (199.6) | (199.6) | ||||||||||||||
Common share dividends | (249.9) | (249.9) | (249.9) | (263.2) | (513.1) | ||||||||||||||
Preferred share dividends | (45.2) | (45.2) | (45.2) | $ (45.2) | (45.2) | ||||||||||||||
Acquisitions of subsidiaries | 111.5 | 111.5 | |||||||||||||||||
Net changes in capitalization | 37.6 | (211.2) | (173.6) | (173.6) | (1,070.9) | (1,244.5) | |||||||||||||
Other | 2.6 | (2.6) | 29.5 | 29.5 | 29.5 | 25.7 | 55.2 | ||||||||||||
Ending balance at Dec. 31, 2022 | $ 6,086.3 | $ 1,335.5 | $ (891.3) | $ 615.7 | $ 10,509.6 | $ (979.6) | $ 15,340.7 | $ 16,676.2 | $ 3,659.6 | $ 20,335.8 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Equity (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Issued capital. | Multiple voting shares | |||
Common stock, multiple voting shares, value | $ 3.8 | $ 3.8 | $ 3.8 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Operating activities | ||
Net earnings | $ 1,286.8 | $ 3,666.6 |
Depreciation, amortization and impairment charges | 683.6 | 930.4 |
Net bond premium (discount) amortization | (34.2) | 65 |
Amortization of share-based payment awards | 146.1 | 104.1 |
Share of profit of associates | (1,014.7) | (402) |
Net deferred income taxes | (181.6) | 339 |
Net (gains) losses on investments | 1,733.9 | (3,445.1) |
Gain on sale and consolidation of insurance subsidiaries | (1,219.7) | (264) |
Loss on repurchase of borrowings | 45.7 | |
Net (purchases) sales of investments classified at FVTPL | (9,640.2) | 2,614.4 |
Changes in operating assets and liabilities | 3,820.1 | 2,986.9 |
Cash provided by (used in) operating activities | (4,419.9) | 6,641 |
Investing activities | ||
Sales of investments in associates | 192.9 | 809.2 |
Purchases of investments in associates | (363.5) | (175.4) |
Net purchases of premises and equipment and intangible assets | (418.9) | (353.9) |
Net sales of investment property | 84.7 | 27 |
Purchases of subsidiaries, net of cash acquired | (229.9) | 1,259.5 |
Cash provided by investing activities | 384.8 | 1,838.6 |
Financing activities | ||
Purchases for treasury | (148.2) | (132.6) |
Purchases for cancellation | (199.6) | (1,058.1) |
Common share dividends | (249.9) | (272.1) |
Preferred share dividends | (45.2) | (44.5) |
Subsidiary shares: | ||
Issuances to non-controlling interests, net of issuance costs | 167.5 | 1,603.2 |
Purchases of non-controlling interests | (1,384.7) | (233) |
Sales to non-controlling interests | 174.8 | |
Dividends paid to non-controlling interests | (261) | (175.6) |
Cash used in financing activities | (1,294.6) | (1,189.3) |
Increase (decrease) in cash and cash equivalents | (5,329.7) | 7,290.3 |
Cash and cash equivalents - beginning of year | 11,685.4 | 4,467.1 |
Foreign currency translation | (236.1) | (72) |
Cash and cash equivalents - end of year | 6,119.6 | 11,685.4 |
Holding company and insurance and reinsurance companies | ||
Investing activities | ||
Proceeds from sale of subsidiaries, net of cash divested | 1,109 | 85.4 |
Financing activities | ||
Proceeds, net of issuance costs | 743.4 | 1,250 |
Repayments | (0.3) | (932.9) |
Net repayments on holding company credit facility | (700) | |
Net repayments on other revolving credit facilities | (35) | (84.3) |
Principal payments on lease liabilities | (68.5) | (64.6) |
Non-insurance companies | ||
Investing activities | ||
Proceeds from sale of subsidiaries, net of cash divested | 10.5 | 186.8 |
Financing activities | ||
Proceeds, net of issuance costs | 47 | 499.1 |
Repayments | (25.3) | (593.9) |
Net borrowings (repayments) on revolving credit facilities and short term loans | 304.1 | (262) |
Principal payments on lease liabilities | $ (138.9) | $ (162.8) |
Business Operations
Business Operations | 12 Months Ended |
Dec. 31, 2022 | |
Business Operations | |
Business Operations | 1. Business Operations Fairfax Financial Holdings Limited (“the company” or “Fairfax”) is a holding company which, through its subsidiaries, is primarily engaged in property and casualty insurance and reinsurance and the associated investment management. The holding company is federally incorporated and domiciled in Ontario, Canada. |
Basis of Presentation
Basis of Presentation | 12 Months Ended |
Dec. 31, 2022 | |
Basis of Presentation | |
Basis of Presentation | 2. Basis of Presentation The company’s consolidated financial statements for the year ended December 31, 2022 are prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The consolidated financial statements have been prepared on a historical cost basis, except for derivative financial instruments, investment property and fair value through profit and loss (“FVTPL”) financial assets and liabilities that have been measured at fair value. The consolidated balance sheets of the company are presented on a non-classified basis. Assets expected to be realized and liabilities expected to be settled within the company’s normal operating cycle of one year are considered current, including the following balances: cash, short term investments, insurance contract receivables, deferred premium acquisition costs, derivative obligations and insurance contract payables. The following balances are considered non-current: deferred income tax assets, goodwill and intangible assets and deferred income tax liabilities. All other balances are comprised of current and non-current amounts. The holding company has significant liquid resources that are generally not restricted by insurance regulators. The subsidiary insurance and reinsurance companies are often subject to a wide variety of insurance and other laws and regulations that vary by jurisdiction and are intended to protect policyholders rather than investors. These laws and regulations may limit the ability of the insurance and reinsurance companies to pay dividends or make distributions to parent companies. The company’s consolidated balance sheet and consolidated statement of cash flows therefore make a distinction in classification between the holding company and the insurance and reinsurance companies for cash and investments to provide additional insight into the company’s liquidity, financial leverage and capital structure. These consolidated financial statements were approved for issue by the company’s Board of Directors on March 10, 2023. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 3. Summary of Significant Accounting Policies The principal accounting policies applied to the presentation of these consolidated financial statements and the methods of computation have been consistently applied to all periods presented unless otherwise stated, and are as set out below. Consolidation Subsidiaries The consolidated financial statements were prepared as of December 31, 2022 and 2021 based on individual holding companies’ and subsidiaries’ financial statements at those dates. Accounting policies of subsidiaries have been aligned with those of the company where necessary. The company’s significant operating subsidiaries are identified in note 29. Non-controlling interests Business combinations Business combinations are accounted for using the acquisition method of accounting whereby the consideration transferred is measured at fair value at the date of acquisition. This consideration may include cash paid and the fair value at the date of exchange of assets given, liabilities assumed and equity instruments issued by the company or its subsidiaries. Directly attributable acquisition-related costs are recorded in operating expenses or other expenses in the consolidated statement of earnings as incurred. At the date of acquisition, the company recognizes the identifiable assets acquired, the liabilities assumed and any non-controlling interest in the acquired business. The identifiable assets acquired and liabilities assumed are initially recognized at fair value. For each business combination the company determines whether to initially record non-controlling interest at fair value or as the proportionate share of the identifiable net assets of the acquired subsidiary. If the consideration transferred is less than the fair value of identifiable net assets acquired, the excess is recognized in the consolidated statement of earnings. An existing equity interest in an acquired subsidiary is remeasured to fair value at the date of the business combination with any gain or loss recognized in net gains (losses) on investments or in gain on sale and consolidation of insurance subsidiaries in the consolidated statement of earnings. Goodwill and intangible assets Goodwill Intangible assets Intangible assets are initially recognized at cost, or at fair value when acquired through a business combination. Intangible assets with a finite life are subsequently measured at cost less accumulated amortization and impairment, where amortization is calculated using the straight-line method over the estimated useful life, and carrying value is re-assessed when there are indicators of impairment. Indefinite-lived intangible assets are not subject to amortization and are assessed annually for impairment or more frequently if there are indicators of impairment. When the carrying value of an intangible asset exceeds its recoverable amount, an impairment loss is recorded in operating expenses or other expenses in the consolidated statement of earnings. The estimated useful lives of the company’s intangible assets are as follows: Customer and broker relationships 8 to 20 years Brand names and Lloyd’s participation rights Indefinite Computer software 3 to 15 years Brand names and Lloyd’s participation rights are considered to be indefinite-lived based on their strength, history and expected future use. Investments in associates Investments in associates are accounted for using the equity method and are comprised of investments in corporations, limited partnerships and trusts where the company has the ability to exercise significant influence but not control. An investment in associate is initially recognized at cost and adjusted thereafter for the post-acquisition change in the company’s share of net assets of the associate. The company’s share of profit (loss) and share of other comprehensive income (loss) of associates are reported in the corresponding lines in the consolidated statement of earnings and consolidated statement of comprehensive income, respectively. An existing equity interest in an acquired associate is remeasured to fair value at the date significant influence is obtained and included in the carrying value of the associate. The fair value of associates is estimated at each reporting date using valuation techniques consistent with those applied to the company’s other investments in equity instruments. See “Determination of fair value” under the heading of “Investments” in this note for further details. If there is objective evidence that the carrying value of an associate is impaired, it is written down to its recoverable amount, being the higher of the associate’s fair value and value-in-use. The unrealized impairment loss is recognized in share of profit (loss) of associates in the consolidated statement of earnings. An impairment loss is reversed in future periods if the circumstances that led to the impairment no longer exist. The reversal is limited to restoring the carrying value to what it would have been had no impairment loss been recognized in prior periods. Upon loss of significant influence, any retained equity interest classified as a financial asset is remeasured to fair value and all amounts previously recognized in other comprehensive income (loss) are recycled to the consolidated statement of earnings except those related to defined benefit pension or post retirement plans which are reclassified to retained earnings. Gains and losses on loss of significant influence or disposition of an associate are recognized in net gains (losses) on investments in the consolidated statement of earnings. Investments in joint ventures Investments in joint ventures are accounted for using the equity method (as described in the preceding paragraphs) and are comprised of investments in corporations and limited partnerships where the company has joint control together with one or more third parties by contractual agreement. Joint control requires the unanimous consent of all parties sharing control to make decisions regarding the joint venture’s relevant activities. When a subsidiary constituting a business is contributed to a joint venture, any gain or loss on derecognition of the subsidiary, including recycling of applicable amounts in accumulated other comprehensive income (loss) and remeasurement to fair value of any retained interest in the subsidiary, is recognized in the consolidated statement of earnings. Upon loss of joint control, any retained equity interest classified as a financial asset is remeasured to fair value and all amounts previously recognized in other comprehensive income (loss) are reclassified to the consolidated statement of earnings except those related to defined benefit pension or post retirement plans which are reclassified to retained earnings. Gains and losses on loss of joint control or disposition of a joint venture are recognized in net gains (losses) on investments in the consolidated statement of earnings. Investments in joint ventures and all related activity are presented with investments in associates in these consolidated financial statements. Consolidated statement of cash flows The company’s consolidated statement of cash flows is prepared in accordance with the indirect method, classifying cash flows by operating, investing and financing activities. Cash and cash equivalents Investments Investments include cash and cash equivalents, short term investments, bonds, equity instruments, investments in associates, derivative assets, other invested assets (primarily investment property) and derivative obligations. Management determines the appropriate classifications of investments at their acquisition date. Classification - Recognition and measurement - Subsequent to initial recognition, investments classified at FVTPL are measured at fair value with changes in fair value reported in the consolidated statement of earnings as income, comprised of interest and dividends and net gains (losses) on investments. Interest and dividends represent interest income on short term investments and bonds calculated using the effective interest method, and dividends received on holdings of common stocks and preferred stocks, net of investment expenses. All other changes in fair value are reported in net gains (losses) on investments in the consolidated statement of earnings. For short term investments and bonds, the sum of their interest income and net gains (losses) on investments is equal to their total change in fair value for the reporting period. For investments classified at FVTPL, the company further disaggregates net gains (losses) on investments into realized and unrealized components in note 5. Where a financial instrument continues to be held by the company at the end of a reporting period, changes in the fair value of that instrument during the reporting period, excluding those changes reported as interest and dividends, are presented in net change in unrealized gains (losses). On disposition or as a result of a change in accounting for that financial instrument, its inception-to-date net gain (loss), excluding those changes previously reported as interest and dividends, is presented as net realized gains (losses). The cumulative unrealized net gain (loss) recognized in prior periods on that financial instrument is then reversed in net change in unrealized gains (losses). The sum of the inception-to-date net gain (loss) and the cumulative reversal of prior period net unrealized gains (losses) equals that financial instrument’s net gain (loss) on investment for the current reporting period as presented in the consolidated statement of earnings. Interest and dividends and net gains (losses) on investments are reported as operating activities in the consolidated statement of cash flows. Derecognition Short term investments Bonds Derivatives The company uses derivatives for investment purposes and to mitigate financial risks arising from its investment holdings and reinsurance recoverables, and monitors its derivatives for effectiveness in achieving their risk management objectives where applicable. The fair value of derivatives in a gain position are presented on the consolidated balance sheet in holding company cash and investments, and in portfolio investments as derivatives and other invested assets. The fair value of derivatives in a loss position are presented on the consolidated balance sheet in derivative obligations. The initial premium paid for a derivative contract, if any, is recorded as a derivative asset and subsequently adjusted for changes in the fair value of the contract at each reporting date. Changes in the fair value of derivatives are recorded as net gains (losses) on investments in the consolidated statement of earnings. Cash received from counterparties as collateral for derivative contracts is recognized on the consolidated balance sheet in holding company cash and investments or subsidiary cash and short term investments, and a corresponding liability is recognized in accounts payable and accrued liabilities. Securities received from counterparties as collateral are not recorded as assets. Cash and securities delivered to counterparties as collateral for derivative contracts continue to be reflected as assets on the consolidated balance sheet in holding company cash and investments or in portfolio investments as assets pledged for derivative obligations. The portion of the collateral related to changes in fair value of derivative contracts may be repledged by the counterparties holding the collateral. Determination of fair value Level 1 - Inputs represent unadjusted quoted prices for identical instruments exchanged in active markets. The fair values of the majority of the company’s common stocks, equity call options and certain warrants are based on published quotes in active markets. Level 2 - Inputs include directly or indirectly observable inputs (other than Level 1 inputs) such as quoted prices for similar financial instruments exchanged in active markets, quoted prices for identical or similar financial instruments exchanged in inactive markets and other market observable inputs. The fair value of the vast majority of the company’s investments in bonds are priced based on information provided by independent pricing service providers while much of the remainder, along with most derivative contracts (including total return swaps, U.S. treasury bond forward contracts and certain warrants) are based primarily on non-binding third party broker-dealer quotes that are prepared using Level 2 inputs. Where third party broker-dealer quotes are used, typically one quote is obtained from a broker-dealer with particular expertise in the instrument being priced. Preferred stocks are priced using a combination of independent pricing service providers and internal valuation models that rely on directly or indirectly observable inputs. The fair values of investments in certain limited partnerships classified as common stocks on the consolidated balance sheet are based on the net asset values received from the general partner, adjusted for liquidity as required and are classified as Level 2 when they may be liquidated or redeemed within three months or less of providing notice to the general partner. All other such investments in limited partnerships are classified as Level 3. Level 3 - Inputs include unobservable inputs that management uses to develop assumptions for which market data is limited or unavailable at the measurement date. In some instances, such as for private company preferred shares, management will use limited recent market transactions that are corroborated by industry accepted discounted cash flow models that incorporate one or more unobservable inputs. Transfers between fair value hierarchy levels are considered effective from the beginning of the annual reporting period in which the transfer is identified. Valuation techniques used by the company’s independent pricing service providers and third party broker-dealers include use of prices from similar instruments where observable market prices exist, discounted cash flow analysis, option pricing models, and other valuation techniques commonly used by market participants. The company assesses the reasonableness of pricing received from these third party sources by comparing the fair values received to recent transaction prices for similar assets where available, to industry accepted discounted cash flow models (that incorporate estimates of the amount and timing of future cash flows and market observable inputs such as credit spreads and discount rates) and to option pricing models (that incorporate market observable inputs including the quoted price, volatility and dividend yield of the underlying security and the risk free rate). The company employs specialist personnel for the valuation of its investment portfolio. Detailed valuations are prepared for those financial instruments that are priced internally, while external pricing received from independent pricing service providers and third party broker-dealers are evaluated by the company for reasonableness. The company’s Chief Financial Officer oversees the valuation function and regularly reviews valuation processes and results, including at each quarterly reporting period. Significant valuation matters, particularly those requiring extensive judgment, are communicated to the company’s Audit Committee. Foreign currency translation Functional and presentation currency Foreign currency transactions Translation of foreign subsidiaries Hedging At the inception of a hedge transaction the company documents the economic relationship between the hedged item and hedging instrument, and its risk management objective and strategy for undertaking the hedge. Net investment hedge Comprehensive income (loss) Comprehensive income (loss) consists of net earnings (loss) and other comprehensive income (loss) and includes all changes in total equity during a reporting period, except for those resulting from investments by owners or distributions to owners. Unrealized foreign currency translation amounts arising from the translation of foreign subsidiaries and associates and the effective portion of changes in the fair value of hedging instruments on hedges of net investments in foreign subsidiaries and associates are recognized in other comprehensive income (loss) and included in accumulated other comprehensive income (loss) until recycled to the consolidated statement of earnings on disposal of an investment in a foreign subsidiary or associate. Actuarial gains and losses and changes in asset limitation amounts on defined benefit pension and post retirement plans are recorded in other comprehensive income (loss) and included in accumulated other comprehensive income (loss) without recycling to the consolidated statement of earnings. Upon settlement of the defined benefit plan or disposal of the related subsidiary or associate, those amounts are reclassified directly to retained earnings. Accumulated other comprehensive income (loss), net of income taxes, is included on the consolidated balance sheet as a component of common shareholders’ equity. Property and casualty insurance contracts Insurance contracts are those contracts that have significant insurance risk at the inception of the contract. Insurance risk arises when the company agrees to compensate a policyholder if a specified uncertain future event adversely affects the policyholder, with the possibility of paying (including variability in timing of payments) significantly more in a scenario where the insured event occurs than when it does not occur. Contracts not meeting the definition of an insurance contract under IFRS are classified as investment contracts, derivative contracts or service contracts, as appropriate. Revenue recognition Deferred premium acquisition costs Provision for losses and loss adjustment expenses The company’s reserves for reported losses and loss adjustment expenses are based on estimates of future payments to settle reported general insurance and reinsurance claims and claims from its run-off operations. Case reserve estimates are based on the facts available at the time the reserves are established and for reinsurance, based on reports and individual case reserve estimates received from ceding companies. The company establishes these reserves on an undiscounted basis to recognize the estimated costs of bringing pending claims to final settlement, taking into account inflation, as well as other factors that can influence the amount of reserves required, some of which are subjective and some of which are dependent on future events. In determining the level of reserves, the company considers historical trends and patterns of loss payments, pending levels of unpaid claims and types of coverage. In addition, court decisions, economic conditions and public attitudes may affect the ultimate cost of settlement and, as a result, the company’s estimation of reserves. Between the reporting and final settlement of a claim, circumstances may change, which may result in changes to established reserves. Items such as changes in law and interpretations of relevant case law, results of litigation, changes in medical costs, as well as costs of vehicle and building repair materials and labour rates can substantially impact ultimate settlement costs. Accordingly, the company regularly reviews and re-evaluates case reserves. Any resulting adjustments are included in the current period consolidated statement of earnings in losses on claims, gross, and in losses on claims, ceded to reinsurers, as applicable. Amounts ultimately paid for losses and loss adjustment expenses can vary significantly from the level of reserves originally set or currently recorded. The company also establishes reserves for IBNR losses on an undiscounted basis to recognize the estimated final settlement cost for loss events which have already occurred but which have not yet been reported. Historical information and statistical models, based on product line, type and extent of coverage, as well as reported claims trends, severities and frequencies, inflation, exposure changes and other factors are relied upon to estimate IBNR reserves. These estimates are revised as additional information becomes available and as claims are actually reported and paid. Estimation techniques Where possible the company applies several commonly accepted actuarial projection methodologies in estimating required provisions to give greater insight into the trends inherent in the data being projected. These include methods based upon the following: the development of previously settled claims, where payments to date are extrapolated for each prior year; estimates based upon a projection of number of claims and average cost; notified claims development, where notified claims to date for each year are extrapolated based upon observed development of earlier years; and, expected loss ratios. In addition, the company uses other techniques such as aggregate benchmarking methods for specialist classes of business. In selecting its best estimate, the company considers the appropriateness of the methods to the individual circumstances of the line of business and accident or underwriting year. Large claims affecting each relevant line of business are generally assessed separately, being measured either at the face value of the loss adjuster’s estimate or projected separately in order to allow for the future development of large claims. Provisions for losses and loss adjustment expenses are calculated gross of any reinsurance recoveries. A separate estimate is made of the amounts that will be recoverable from reinsurers based upon the gross provisions and with due regard to collectability. The provisions for losses and loss adjustment expenses are subject to review at the subsidiary level by subsidiary actuaries and at the corporate level by the company’s Chief Actuary. In addition, for major classes of business where the risks and uncertainties inherent in the provisions are greatest, ad hoc detailed reviews are undertaken by internal and external actuaries who are able to draw upon their specialist expertise and a broader knowledge of current industry trends in claims development. The results of these reviews are considered when establishing the appropriate levels of provisions for losses and loss adjustment expenses and unexpired risks. Life insurance contracts The company, through Eurolife (which was consolidated on July 14, 2021 as described in note 23), writes life, disability, accident, health and critical illness insurance in addition to offering life annuities and insurance related investment products, both on an individual and group basis. Premiums for most life insurance contracts are generally recognized as revenue when due. The provision for policy benefits is calculated in compliance with local regulatory requirements and IFRS using actuarial principles consistent with those applied where life insurance policies are written. The provision for policy benefits is determined based on the discounting of projected future cash flows of claims and premiums using assumptions that include mortality, morbidity, lapse rates, discount rates, investment returns, inflation, and future expenses. These assumptions can vary by contract type and reflect current and expected future experience and represent the best estimates to settle outstanding claims, estimated future benefits and expenses on in-force insurance contracts. Certain insurance contracts written by Eurolife transfer the market risk associated with the underlying investment performance, which supports the benefit payments, to the policyholder (“unit-linked”). For these unit-linked contracts or funds, the company measures the underlying investments at fair value and presents them in other assets on the consolidated balance sheet. A corresponding liability is presented in insurance contract payables on the consolidated balance sheet. A change in the fair value of the investments of the unit-linked funds result in a corresponding change to the related liabilities, with both changes recorded together in the consolidated statement of earnings such that there is no effect on income, expenses or net earnings. Reinsurance Reinsurance does not relieve the originating insurer of its liability and is reflected on the consolidated balance sheet on a gross basis to indicate the extent of credit risk related to reinsurance and the obligations of the insurer to its policyholders. Reinsurance assets include balances due from reinsurance companies for paid and unpaid losses and loss adjustment expenses and ceded unearned premiums. Amounts recoverable from reinsurers are estimated in a manner consistent with the claim liability associated with the reinsured policy. Reinsurance is recorded gross on the consolidated balance sheet unless a legal right to offset against a liability owing to the same reinsurer exists. Ceded premiums and losses are recorded in the consolidated statement of earnings in premiums ceded to reinsurers and losses on claims, ceded to reinsurers respectively and in recoverable from reinsurers on the consolidated balance sheet. Commission income earned on premiums ceded to reinsurers is included in commissions, net, in the consolidated statement of earnings. Unearned premiums are reported on the consolidated balance sheet before reduction for premiums ceded to reinsurers. Reinsurers’ portion of unearned premiums is included in recoverable from reinsurers on the consolidated balance sheet together with estimates of reinsurers’ share of provision for claims determined on a basis consistent with the related claims liabilities. Impairment Risk transfer Premiums Income taxes The provision for income taxes for the period comprises current and deferred income tax. Income taxes are recognized in the consolidated statement of earnings, except when related to items recognized in other comprehensive income (loss) or in equity. In those cases, the income taxes are also recognized in other comprehensive income (loss) or in equity, respectively, except for dividends where the income taxes are recognized in earnings, other comprehensive income (loss) or equity according to where the transactions that generated the distributable profits were recognized. Current income tax is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the company’s subsidiaries and associates operate and generate taxable income. Deferred income tax is calculated under the liability method whereby deferred income tax assets and liabilities are recognized for temporary differences between the financial statement carrying amounts of assets and liabilities and their respective income tax bases at current substantively enacted tax rates. With the exception of initial recognition of deferred income tax arising from business combinations, changes in deferred income tax associated with components of other comprehensive income (loss) are recognized in other comprehensive income (loss) while all other changes in deferred income tax are included in the provision for income taxes in the consolidated statement of earnings. Deferred income tax assets are recognized to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilized. Carry forwards of unused losses or unused tax credits are tax effected and recognized as deferred tax assets when it is probable that future taxable profits will be available against which these losses or tax credits can be utilized. Deferred income tax is not recognized on unremitted earnings of subsidiaries where the company has determined it is not probable those earnings will be repatriated in the foreseeable future. Current and deferred income tax assets and liabilities are offset when the income taxes are levied by the same taxation authority and there is a legally enforceable right of offset. Investment property Investment property consists of real estate held by the company for capital appreciation, rental income, or both, and is initially recorded at cost, including transaction costs, and subsequently measured at fair value. On the consolidated balance sheet investment property is included in portfolio investments by the insurance and reinsurance companies and in other assets by the non-insurance companies. In the consolidated statement of earnings, insurance and reinsurance companies record investment property rental income and direct expenses in interest and dividends, and changes in fair value in net gains (losses) on investments, while non-insurance companies record investment property rental income and changes in fair value in other revenue, and direct expenses in other expenses. Other assets Other assets primarily consist of premises and equipment, right-of-use assets associated with leases, assets associated with unit-linked insurance products, inventories, sales receivables and finance lease receivables of the non-insurance companies, prepaid expenses, accrued interest and dividends, income taxes refundable, receivables for securities sold, pension assets, prepaid losses on claims, and other miscellaneous receivables. Receivables are initially recognized at fair value less a provision for expected lifetime credit losses, and subsequently measured at amortized cost. Premises and equipment Other revenue Other revenue is primarily comprised of revenue earned by the non-insurance companies. Revenue from restaurant and retail sales is recognized when the company provides goods to the customer and receives payment. Revenue from the sale of other goods is typically recognized when shipped to the customer, with payment received in advance of shipment. The shipping and handling performance obligation is recorded as a contract liability and recognized as revenue once the services have been performed. Revenue from providing travel, hospitality and other non-insurance services is recognized over time based on measured progress towards complete satisfaction of the related performance obligations. Payment is usually received at the time of initial booking for travel and hospitality services, and received in installments for other services. Unconditional payments due from customers for satisfied performance obligations are recorded as sales receivables within other assets on the consolidated balance sheet. Customer prepayments are recorded as deferred revenue within accounts payable and accrued liabilities on the consolidated balance sheet and are not recognized as revenue until the shipment of goods or provision of services occurs. Certain contracts include multiple deliverables which are accounted for as separate performance obligations, with the transaction price allocated to the performance obligations based on their individual selling prices. Other expenses Other expenses is primarily comprised of the cost of inventories sold or services provided and the operating expenses of the non-insurance companies. Accounts payable and accrued liabilities Accounts payable and accrued liabilities primarily consist of leases liabilities, trade payables of the non-insurance companies, accrued amounts for salaries and employee benefits, deferred revenue of the non-insurance companies, pension and post retirement liabilities, amounts withheld and accrued taxes, income taxes payable, and other administrative costs. Accounts payable and accrued liabilities are initially recognized at fair value and subsequently measured at amortized cost. Borrowings Borrowings are initially recognized at fair value, net of incremental and directly attributable transaction costs, and subsequently measured at amortized cost. Interest expense on borrowings is recognized in the consolidated statement of earnings using the effective interest rate method. Borrowings are derecognized when extinguished, with any gain or loss on extinguishment or modification recognized in interest expense in the consolidated statement of earnings. Equity Common stock issued by the company is classified as equity when there is no contractual obligation to transfer cash or other financial assets to the holder of the shares. Incremental costs directly attributable to the issue or repurchase of equity instruments are recognized in equity, net of tax. Treasury shares are equity instruments repurchased by the company which have not been canceled and are deducted from equity on the consolidated balance sheet, irrespective of the objective of the purchas |
Critical Accounting Estimates a
Critical Accounting Estimates and Judgments | 12 Months Ended |
Dec. 31, 2022 | |
Critical Accounting Estimates and Judgments | |
Critical Accounting Estimates and Judgments | 4. Critical Accounting Estimates and Judgments In the preparation of the company’s consolidated financial statements, management has made a number of critical accounting estimates and judgments as described below, and in certain notes to the consolidated financial statements: determination of fair value for financial instruments in note 5; carrying value of goodwill and intangibles in note 12; and contingencies in note 20. Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable. Provision for losses and loss adjustment expenses Property and casualty insurance and reinsurance provisions for losses and loss adjustment expenses are estimated based on Canadian accepted actuarial practices, which are designed to ensure the company establishes an appropriate reserve on the consolidated balance sheet to cover insured losses and related claims expenses for both reported claims and IBNR claims as of each balance sheet date. The assumptions underlying the estimation of provisions for losses and loss adjustment expenses, the most significant of which are expected loss ratios, loss development patterns, claim frequencies and severities, exposure changes and expected reinsurance recoveries, are regularly reviewed and updated by the company to reflect recent and emerging trends in experience and changes in the risk profile of the business. The estimation techniques employed by the company in determining provisions for losses and loss adjustment expenses and the inherent uncertainties associated with insurance contracts are described in the “Property and casualty insurance contracts” section of note 3 and the “Underwriting Risk” section of note 24, and the historic development of the company’s insurance liabilities are presented in note 8. Determination of fair value for financial instruments classified as Level 3 in the fair value hierarchy Fair values for substantially all of the company’s financial instruments are measured using market or income approaches. Considerable judgment may be required in developing estimates of fair value, particularly for financial instruments classified as Level 3 in the fair value hierarchy as such estimates incorporate unobservable inputs that require management to use its own assumptions. In particular, for private placement debt securities and private company preferred shares the company uses industry accepted discounted cash flow models to respectively, value the instruments directly, and to corroborate fair values implied by limited market activity. Significant judgments and assumptions are required to determine the discounted cash flows, including discount rates, long term growth rates and credit spreads, as applicable, and the effects of economic uncertainty caused by increased inflationary pressures that have resulted in central banks across the world simultaneously raising interest rates to address inflation. See note 5 for details of the company’s Level 3 financial instruments and the valuation assumptions applied. Impairment assessments of goodwill and indefinite-lived intangible assets Goodwill and indefinite-lived intangible assets are assessed annually for impairment, or more frequently if there are indicators of impairment, by comparing the carrying value of the cash-generating unit (“CGU”) or group of CGUs to which these assets are allocated to their recoverable amounts. The company principally uses discounted cash flows to estimate the recoverable amount of a CGU or group of CGUs to which goodwill or indefinite-lived intangible assets have been allocated, and market approaches inclusive of a control premium are used when applicable. Significant judgments and assumptions are required to determine the discounted cash flows, including discount rates, long term growth rates, working capital requirements and the effects of increased inflationary pressures and interest rates, and also (i) for goodwill, premiums, investment returns, revenues and expenses, and (ii) for indefinite-lived intangible assets, premiums, revenues and royalty rates. Discounted cash flows are subject to sensitivity analysis given the uncertainty in preparing forecasts. Details of goodwill and indefinite-lived intangible assets, including the results of annual impairment tests, are presented in note 12. Determination of significant influence, joint control and control The determination of whether an investment is an associate, a joint arrangement or a subsidiary requires consideration of all facts and circumstances, and typically begins with an analysis of the company’s proportion of the investee’s voting rights. Judgment may be required to determine the existence of significant influence, joint control or control when it involves elements such as contractual arrangements between shareholders, currently exercisable potential voting rights through warrants or convertible instruments, significant shareholdings relative to other third party shareholders, and regulatory restrictions on board representation, voting rights, or relevant activities of the investee. De facto control over an investee without holding the majority of its voting rights may occur due to dispersion of third party shareholdings and other factors. Conversely, having significant influence over an investee when holding the majority of its voting rights may occur due to regulatory and other restrictions that limit the application of voting and other rights. The company’s investments in associates and joint ventures are presented in note 6, business combinations and divestitures are presented in note 23 and subsidiaries are presented in note 29. The company exercised judgment in determining it had obtained significant influence over Stelco during 2022, and over Gulf Insurance through arrangements related to its sale of RiverStone Barbados during 2021, pursuant to the transactions described in note 6. |
Cash and Investments
Cash and Investments | 12 Months Ended |
Dec. 31, 2022 | |
Cash and Investments | |
Cash and Investments | 5. Cash and Investments Presented in the table below are holding company cash and investments and portfolio investments, net of derivative obligations, all of which are classified at FVTPL except for investments in associates and other invested assets. December 31, December 31, 2022 2021 Holding company Cash and cash equivalents 552.1 465.9 Short term investments 126.6 216.9 Bonds 243.2 242.6 Preferred stocks 11.1 14.0 Common stocks (1) 75.4 137.5 Derivatives (note 7) 232.8 290.5 1,241.2 1,367.4 Assets pledged for derivative obligations: Cash equivalents 40.6 46.8 Short term investments 64.0 64.1 104.6 110.9 Holding company cash and investments as presented on the consolidated balance sheet 1,345.8 1,478.3 Derivative obligations (note 7) (19.4) (32.1) 1,326.4 1,446.2 Portfolio investments Cash and cash equivalents (2) 6,203.3 12,283.2 Short term investments 3,164.9 9,516.3 Bonds 28,578.5 14,091.2 Preferred stocks 2,338.0 2,405.9 Common stocks (1) 5,124.3 5,468.9 Investments in associates (note 6) 6,091.3 4,755.1 Derivatives (note 7) 235.0 291.3 Other invested assets (3) 593.5 699.9 52,328.8 49,511.8 Assets pledged for derivative obligations: Cash equivalents — 74.0 Short term investments — 45.6 Bonds 51.3 — 51.3 119.6 Fairfax India cash, portfolio investments and associates: Cash and cash equivalents (2) 184.8 76.5 Short term investments 49.7 6.2 Bonds 128.2 199.8 Common stocks 237.5 434.6 Investments in associates (note 6) 1,342.6 1,348.9 1,942.8 2,066.0 Portfolio investments as presented on the consolidated balance sheet 54,322.9 51,697.4 Derivative obligations (note 7) (171.6) (120.8) 54,151.3 51,576.6 Total cash and investments, net of derivative obligations 55,477.7 53,022.8 (1) Includes aggregate investments in limited partnerships with a carrying value at December 31, 2022 of $1,982.5 (December 31, 2021 – $1,971.0 ). (2) Includes aggregate restricted cash and cash equivalents at December 31, 2022 of $861.2 (December 31, 2021 – $1,261.0 ). See note 27. (3) Comprised primarily of investment property. Restricted cash and cash equivalents at December 31, 2022 of $861.2 (December 31, 2021 – $1,261.0) was comprised primarily of amounts required to be maintained on deposit with various regulatory authorities to support the operations of the insurance and reinsurance subsidiaries. Refer to note 27 for details of restricted cash and cash equivalents presented on the consolidated balance sheet. The company’s subsidiaries have pledged cash and investments, inclusive of trust funds and regulatory deposits, as security for their own obligations to pay claims or make premium payments (these pledges are either direct or collateral for letters of credit). In order to write insurance business in certain jurisdictions (primarily U.S. states) the company’s subsidiaries must deposit funds with local insurance regulatory authorities to provide security for future claims payments as ultimate protection for the policyholder. Additionally, some of the company’s subsidiaries provide reinsurance to primary insurers, for which funds must be posted as security for losses that have been incurred but not yet paid. These pledges are in the normal course of business and are generally released when the payment obligation is fulfilled. The table that follows summarizes assets pledged to third parties by the nature of the pledge requirement (excluding assets pledged in favour of Lloyd’s (note 20), for derivative obligations and for certain intercompany reinsurance arrangements). Pledged assets primarily consist of cash and cash equivalents, short term investments and bonds within portfolio investments on the consolidated balance sheet. December 31, December 31, 2022 2021 Regulatory deposits 5,724.2 5,147.1 Security for reinsurance and other 1,611.0 1,434.9 7,335.2 6,582.0 Fixed Income Maturity Profile Bonds are summarized by their earliest contractual maturity date in the table below. Actual maturities may differ from maturities shown below due to the existence of call and put features. At December 31, 2022 bonds containing call, put and both call and put features represented $5,933.7, $30.9 and $427.7 respectively (December 31, 2021 - $4,063.0, $77.2 and $467.8) of the total fair value of bonds. The table below does not reflect the impact of U.S. treasury bond forward contracts with a notional amount at December 31, 2022 of $183.7 (December 31, 2021 - $1,691.3) that economically hedge the company’s exposure to interest rate risk as described in note 7. The increase in the company’s holdings of bonds due in 1 year or less was primarily due to net purchases of Canadian government bonds, Canadian provincial bonds and first mortgage loans of $779.0, $207.6 and $870.2 respectively and debentures received on the sale of Crum & Forster’s Pet Insurance Group and Pethealth as described in note 23. The increase in the company’s holdings of bonds due after 1 year through 3 years was primarily due to net investments of existing cash and proceeds from sales and maturities of U.S. treasury and Canadian provincial short term investments into U.S. treasury and Canadian government bonds with 1 to 3 year terms of $8,287.0 and $609.3, and short-dated high quality corporate bonds of $2,202.6. The increase in the company’s holdings of bonds due after 3 years through 5 years was primarily due to net purchases of U.S. treasury bonds with 3 to 5 year terms of $2,905.1. December 31, 2022 December 31, 2021 Amortized Fair Amortized Fair cost (1) value (1) cost (1) value (1) Due in 1 year or less (2) 8,506.5 8,192.5 6,022.8 5,946.5 Due after 1 year through 3 years (2) 16,077.6 15,686.2 3,933.5 4,206.0 Due after 3 years through 5 years 4,205.8 4,116.6 2,740.7 2,744.1 Due after 5 years through 10 years 318.8 291.1 534.0 531.3 Due after 10 years 859.9 714.8 990.1 1,105.7 29,968.6 29,001.2 14,221.1 14,533.6 Pre-tax effective interest rate 3.6 % 2.7 % (1) Includes bonds held by the holding company and Fairfax India. (2) Includes the company’s investments in first mortgage loans at December 31, 2022 of $2,500.7 (December 31, 2021 - $1,659.4 ) secured by real estate predominantly in the U.S., Europe and Canada. Fair Value Disclosures The company’s use of quoted market prices (Level 1), valuation models with significant observable market information as inputs (Level 2) and valuation models with significant unobservable information as inputs (Level 3) in the valuation of securities and derivative contracts by type of issuer was as follows: December 31, 2022 December 31, 2021 Significant Significant other Significant other Significant Quoted observable unobservable Total fair Quoted observable unobservable Total fair prices inputs inputs value asset prices inputs inputs value asset (Level 1) (Level 2) (Level 3) (liability) (Level 1) (Level 2) (Level 3) (liability) Cash and cash equivalents (1) 6,980.8 — — 6,980.8 12,946.4 — — 12,946.4 Short term investments: Canadian government 91.8 — — 91.8 16.2 — — 16.2 Canadian provincials 38.1 — — 38.1 535.8 — — 535.8 U.S. treasury 1,574.5 — — 1,574.5 7,608.8 — — 7,608.8 Other government 164.3 1,238.5 — 1,402.8 283.5 1,140.9 — 1,424.4 Corporate and other — 298.0 — 298.0 — 263.9 — 263.9 1,868.7 1,536.5 — 3,405.2 8,444.3 1,404.8 — 9,849.1 Bonds: Canadian government — 1,923.5 — 1,923.5 — 614.6 — 614.6 Canadian provincials — 284.1 — 284.1 — 45.0 — 45.0 U.S. treasury — 14,378.8 — 14,378.8 — 3,957.9 — 3,957.9 U.S. states and municipalities — 262.7 — 262.7 — 387.2 — 387.2 Other government — 2,700.2 — 2,700.2 — 2,655.0 — 2,655.0 Corporate and other (2) — 5,986.6 3,465.3 9,451.9 — 4,078.1 2,795.8 6,873.9 — 25,535.9 3,465.3 29,001.2 — 11,737.8 2,795.8 14,533.6 Preferred stocks: Canadian 10.4 9.2 13.2 32.8 — 16.6 93.6 110.2 U.S. — — 233.6 233.6 — — 40.6 40.6 Other (3) 13.2 269.2 1,800.3 2,082.7 13.5 288.0 1,967.6 2,269.1 23.6 278.4 2,047.1 2,349.1 13.5 304.6 2,101.8 2,419.9 Common stocks: Canadian 624.3 192.3 427.8 1,244.4 1,104.2 188.4 303.7 1,596.3 U.S. 691.0 26.1 1,087.2 1,804.3 597.9 32.0 1,155.3 1,785.2 Other 1,097.8 254.1 1,036.6 2,388.5 1,438.0 276.7 944.8 2,659.5 2,413.1 472.5 2,551.6 5,437.2 3,140.1 497.1 2,403.8 6,041.0 Derivatives and other invested assets — 341.8 719.5 1,061.3 0.1 175.4 1,106.2 1,281.7 Derivative obligations (note 7) — (151.8) (39.2) (191.0) — (88.5) (64.4) (152.9) Holding company cash and investments and portfolio investments measured at fair value 11,286.2 28,013.3 8,744.3 48,043.8 24,544.4 14,031.2 8,343.2 46,918.8 23.5 % 58.3 % 18.2 % 100.0 % 52.3 % 29.9 % 17.8 % 100.0 % Investments in associates (note 6) (4) 4,693.8 95.3 4,463.2 9,252.3 4,188.8 106.8 3,995.6 8,291.2 (1) Includes restricted cash and cash equivalents of $861.2 at December 31, 2022 (December 31, 2021 – $1,261.0 ). See note 27. (2) Included in Level 3 are the company’s investments in first mortgage loans at December 31, 2022 of $2,500.7 (December 31, 2021 – $1,659.4 ) secured by real estate predominantly in the U.S., Europe and Canada. (3) Primarily comprised of the company’s investment in compulsory convertible preferred shares of Go Digit Infoworks Services Limited (“Digit”),which is described in footnote (2) of the following table. The company also holds a 49.0% equity interest in Digit as described in note 6. (4) The fair value of investments in associates is presented separately as such investments are measured using the equity method of accounting. Also included is the fair value of Resolute Forest Products which was held for sale at December 31, 2022 as described in note 6. In the preceding table certain limited partnerships included in common stocks are classified as Level 3 because their net asset values are unobservable or because they contractually require greater than three months to liquidate or redeem. During 2022 and 2021 there were no significant transfers of financial instruments between Level 1 and Level 2, and there were no significant transfers of financial instruments in or out of Level 3 as a result of changes in the observability of valuation inputs except as described in the following table which summarizes changes in Level 3 financial assets measured at fair value on a recurring basis. 2022 Private Private Derivatives placement company Limited Private and other debt preferred partnerships equity Common invested securities shares and other (1) funds (1) shares assets Total Balance - January 1 2,795.8 2,101.8 1,789.1 107.7 507.0 1,041.8 8,343.2 Net realized and unrealized gains (losses) included in the consolidated statement of earnings (2) (378.8) (247.4) 143.0 (1.4) 61.9 (95.8) (518.5) Purchases (3) 1,456.0 286.4 113.1 — 102.7 67.4 2,025.6 Sales and distributions (3) (382.4) (88.1) (207.0) (4.2) (14.3) (303.8) (999.8) Transfer out of category — — — — (2.7) — (2.7) Unrealized foreign currency translation losses on foreign subsidiaries included in other comprehensive income (loss) (25.3) (5.6) (14.0) (4.6) (24.7) (29.3) (103.5) Balance - December 31 3,465.3 2,047.1 1,824.2 97.5 629.9 680.3 8,744.3 2021 Private Private Derivatives placement company Limited Private and other debt preferred partnerships equity Common invested securities shares and other (1) funds (1) shares assets Total Balance - January 1 1,774.2 587.4 1,766.9 110.8 239.9 697.6 5,176.8 Net realized and unrealized gains included in the consolidated statement of earnings (2) 69.1 1,489.3 450.6 2.4 53.7 297.4 2,362.5 Purchases (3)(4)(5) 1,241.5 32.0 254.3 — 216.9 115.5 1,860.2 Acquisitions of subsidiaries (note 23) 47.5 — — — — 27.4 74.9 Transfer into category (6) 139.6 — — — 10.9 — 150.5 Sales and distributions (3) (476.6) (7.2) (580.9) (5.9) (2.5) (91.8) (1,164.9) Transfer out of category — — (102.0) — (10.7) — (112.7) Unrealized foreign currency translation gains (losses) on foreign subsidiaries included in other comprehensive income (loss) 0.5 0.3 0.2 0.4 (1.2) (4.3) (4.1) Balance - December 31 2,795.8 2,101.8 1,789.1 107.7 507.0 1,041.8 8,343.2 (1) Included in common stocks in the fair value hierarchy table presented on the previous page and in holding company cash and investments or common stocks on the consolidated balance sheets. (2) During June 2021, the company’s associate Go Digit Infoworks Services Private Limited (“Digit”) entered into agreements with certain third party investors for its general insurance subsidiary Go Digit Insurance Limited (“Digit Insurance”) to raise approximately $200 ( 14.9 billion Indian rupees) of new equity shares, valuing Digit Insurance at approximately $3.5 billion ( 259.5 billion Indian rupees) (the “transaction fair value”). Digit Insurance subsequently closed the majority of the $200 raise in the fourth quarter of 2021 and first half of 2022. At December 31, 2021, the company estimated the fair value of Digit Insurance using the transaction fair value, which was supported by an internal discounted cash flow analysis, resulting in the company recording a net unrealized gain of $1,490.3 in 2021 (inclusive of foreign exchange losses) on its investment in Digit compulsory convertible preferred shares. At December 31, 2022, the company estimated the fair value of Digit Insurance using an internal discounted cash flow analysis that continues to approximate the transaction fair value, resulting in the company recording a net unrealized loss of $167.2 in 2022, principally related to foreign exchange losses on its investment in Digit compulsory convertible preferred shares. The company also holds a 49.0% equity accounted interest in Digit as described in note 6. (3) Private placement debt securities include net purchases of first mortgage loans of $870.2 (2021 - $826.9 ). (4) Common shares include non-voting shares of the RiverStone Barbados holding company as described in note 23. (5) Derivatives and other invested assets include a monthly royalty on future revenues of Toys “R” Us Canada as described in note 23. (6) Private placement debt securities include Mosaic Capital 25-year debentures as described in note 23. The table below presents the valuation techniques and unobservable inputs used to estimate fair values for the company’s significant Level 3 financial assets at December 31, 2022: Effect on fair value if input Carrying Input range used value is Asset class value Valuation technique Significant unobservable input Low High increased (a) Bonds (b) Private placement debt securities (1) 834.2 Discounted cash flow Credit spread 2.8 % 12.7 % Decrease Mortgage loans (2) 2,500.7 Market approach Recent transaction price N/A N/A Increase Discounted cash flow Credit spread 2.1 % 6.4 % Decrease Other 130.4 Various Various N/A N/A N/A 3,465.3 Preferred stocks (c) Private company preferred shares (3) 1,798.3 Discounted cash flow Discount rate 10.9 % 10.9 % Decrease Long term growth rate 6.3 % 6.3 % Increase Private placement preferred shares 156.7 Discounted cash flow Credit spread 5.8 % 5.8 % Decrease Other 92.1 Various Various N/A N/A N/A 2,047.1 Common stocks (d) Limited partnerships and other (4) 1,824.2 Net asset value Net asset value N/A N/A Increase Common shares 261.6 Market approach Recent transaction price N/A N/A Increase Other 465.8 Various Various N/A N/A N/A 2,551.6 Derivatives and other invested assets (e) Investment property (5) 437.3 Income capitalization Terminal capitalization rate 6.0 % 8.0 % Decrease Discount rate 6.9 % 9.3 % Decrease Market rent growth rate 2.6 % 3.0 % Increase 66.0 Sales comparison Price per acre (Cdn$ thousands) 30.0 150.0 Increase Other 177.0 Various Various N/A N/A N/A 680.3 Total 8,744.3 (a) Decreasing the input value would have the opposite effect on the estimated fair value. (b) Included in holding company cash and investments or bonds on the consolidated balance sheet. (c) Included in preferred stocks on the consolidated balance sheet. (d) Included in holding company cash and investments or common stocks on the consolidated balance sheet. (e) Included in holding company cash and investments or derivatives and other invested assets, net of derivative obligations, on the consolidated balance sheet. (1) At December 31, 2022 these private placement debt securities were valued using industry accepted discounted cash flow models that incorporated unobservable credit spreads of the issuers, and consisted of 10 investments, the largest being $285.0 (software and services) (December 31, 2021 - 12 investments, the largest being $535.1 (software and services)). By increasing (decreasing) the credit spreads applied at December 31, 2022 by 100 basis points, the fair value of this asset class would collectively decrease by $23.2 (increase by $24.5 ). (2) At December 31, 2022 these mortgage loans consisted of 50 investments, the largest being $250.0 (December 31, 2021 – 36 investments, the largest being $149.4 ). By increasing (decreasing) the credit spreads applied at December 31, 2022 by 100 basis points, the fair value of this asset class would not change significantly primarily due to the short term nature of these instruments. (3) These private company preferred shares relate to the company’s investment in Digit compulsory convertible preferred shares which were valued using an industry accepted discounted cash flow model that incorporated an unobservable discount rate and long term growth rate. By increasing (decreasing) the discount rate applied at December 31, 2022 by 1.0% , the fair value of the preferred shares would decrease by $308.2 (increase by $591.8 ); by increasing (decreasing) the long term growth rate applied at December 31, 2022 by 0.5% , the fair value of the preferred shares would increase by $175.8 (decrease by $141.7 ). (4) Limited partnerships and other are investment funds managed by third party fund managers and general partners that invest in a diverse range of industries and geographies. These investment funds were valued primarily using net asset value statements provided by those third party fund managers and general partners. The fair values in those statements are determined using quoted prices of the underlying assets, and to a lesser extent, observable inputs where available and unobservable inputs, in conjunction with industry accepted valuation models, where required. In some instances, such investments are classified as Level 3 if they require at least three months’ notice to liquidate or redeem. At December 31, 2022 limited partnerships and other consisted of 45 investments, the three largest being $374.8 (oil and gas extraction), $189.5 (industrials) and $176.1 (industrials) (December 31, 2021 - 47 investments, the three largest being $258.2 (industrials), $252.1 (oil and gas extraction) and $192.0 (primarily household appliance manufacturing)). By increasing (decreasing) net asset values at December 31, 2022 by 10% , the fair value of limited partnerships and other would collectively increase (decrease) by $182.4 . (5) These investment property were primarily valued by third party appraisers using an industry accepted income capitalization approach that incorporated unobservable capitalization rates, discount rates and market rent growth rates. Certain investment property were valued using an industry accepted direct sales comparison approach that incorporated unobservable recent sale prices per acre for comparable properties in similar locations. Investment Income An analysis of investment income for the years ended December 31 follows: Interest and dividends and share of profit of associates 2022 2021 Interest income: Cash and short term investments 101.5 26.8 Bonds 753.1 488.5 Derivatives and other invested assets 18.9 53.1 873.5 568.4 Dividends: Preferred stocks 39.7 14.1 Common stocks 100.7 94.1 140.4 108.2 Investment expenses (52.1) (35.8) Interest and dividends 961.8 640.8 Share of profit of associates (note 6) 1,014.7 402.0 Net gains (losses) on investments 2022 2021 Net change in Net gains Net change in Net gains Net realized unrealized (losses) on Net realized unrealized (losses) on gains (losses) gains (losses) investments gains (losses) gains (losses) investments Common stocks 364.5 (1) (607.2) (1) (242.7) 483.4 850.0 1,333.4 Preferred stocks - convertible 1.4 (5.8) (4.4) 0.7 2.1 2.8 Bonds - convertible 10.2 (247.2) (237.0) 0.2 101.1 101.3 Other equity derivatives (2)(3) 331.7 (4) (140.9) (4) 190.8 461.5 170.1 631.6 Disposition of non-insurance associates 45.1 — 45.1 52.7 (5) — 52.7 Deconsolidation of non-insurance subsidiaries 4.4 — 4.4 190.3 (6) — 190.3 Long equity exposures and financial effects 757.3 (1,001.1) (243.8) 1,188.8 1,123.3 2,312.1 Bonds (183.6) (1,064.9) (1,248.5) 338.0 (7) (624.6) (7) (286.6) U.S. treasury bond forward contracts 163.0 (0.6) 162.4 26.0 (0.3) 25.7 Total bonds (20.6) (1,065.5) (1,086.1) 364.0 (624.9) (260.9) Preferred stocks 12.9 (101.1) (88.2) 1.5 1,507.4 (8) 1,508.9 Other derivative contracts (62.0) 86.6 24.6 (157.2) 181.3 24.1 Foreign currency (9) 105.8 (410.1) (304.3) (64.5) (28.6) (93.1) Other (36.3) 0.2 (36.1) 130.4 (176.4) (46.0) Net gains (losses) on investments 757.1 (2,491.0) (1,733.9) 1,463.0 1,982.1 3,445.1 (1) On August 31, 2022 Stelco. repurchased 5.1 million of its outstanding common shares under its substantial issuer bid which resulted in the loss of a certain right held by another investor and the company’s ownership interest in Stelco increasing to 20.5% . Accordingly, the company commenced applying the equity method of accounting to its interest in Stelco at that date, resulting in unrealized gains of $151.9 being reclassified to realized with a net impact of nil in the consolidated statement of earnings, as described in note 6. (2) Other equity derivatives include long equity total return swaps, equity warrants and options and the Asset Value Loan Notes (“AVLNs”) entered with RiverStone Barbados as described in note 23. Net change in unrealized gains (losses) in 2022 included $100.6 in unrealized gains (2021 - $91.8 ) on the company’s investment in long equity total return swaps on Fairfax subordinate voting shares, with the fair value of $196.3 at December 31, 2022 (December 31, 2021 - $95.7 ) recorded in holding company cash and investments, as described in note 7. (3) Amounts recorded in net realized gains (losses) include net gains (losses) on total return swaps where the counterparties are generally required to cash-settle monthly or quarterly the market value movement since the previous reset date notwithstanding that the total return swap positions remain open subsequent to the cash settlement. Net realized gains (losses) in 2022 included $154.8 in realized gains (2021 - $130.9 ) on the company’s investment in long equity total return swaps on Fairfax subordinate voting shares, which represented cash-settlement amounts recorded in holding company cash and investments. (4) On April 6, 2022 the company acquired 25.0 million Atlas common shares by exercising its Atlas equity warrants with a strike price of $8.05 per share for aggregate cash consideration of $201.3 and recognized a net loss on investment of $37.2 (realized gains of $58.6 , of which $95.8 was recorded as unrealized gains in prior years) on derecognition of the equity warrants as described in note 6. (5) During 2021 the company sold a portion of its investment in IIFL Finance for cash proceeds of $113.7 ( 8.6 billion Indian rupees) and recorded a net realized gain of $42.0 in the consolidated statement of earnings as described in note 6. (6) Principally comprised of the sale of Toys “R” Us Canada and Fairfax India’s sale of Privi during 2021. (7) Includes the derecognition of Seaspan Corporation debentures that were exchanged for Atlas Corp. preferred shares and Seaspan Corporation debentures that were redeemed as described in note 6. (8) Includes net unrealized gains of $1,490.3 (inclusive of foreign exchange losses) on Digit compulsory convertible preferred shares during 2021 described earlier in this note. (9) Foreign currency net losses on investing activities during 2022 primarily related to the strengthening of the U.S. dollar relative to the company’s investments denominated in the Indian rupee, Canadian dollar, Egyptian pound, Sri Lankan rupee and British pound, partially offset by foreign currency net gains on U.S. dollar denominated investments held by subsidiaries with a Canadian dollar or British pound functional currency as the U.S. dollar strengthened relative to those currencies. Foreign currency net losses on investing activities during 2021 primarily related to euro and Indian rupee denominated investments held by subsidiaries with a U.S. dollar functional currency as the U.S. dollar strengthened relative to those currencies. |
Investments in Associates
Investments in Associates | 12 Months Ended |
Dec. 31, 2022 | |
Investments in Associates | |
Investments in Associates | 6. Investments in Associates The company’s investments in associates are as follows: December 31, 2022 Year ended December 31, Carrying value 2022 Associates Share of Ownership Fair and joint Fairfax India profit percentage (a) value (b) ventures associates (c) Total (loss) Insurance and reinsurance: Gulf Insurance Group K.S.C.P. (“Gulf Insurance”) 43.7 % 415.8 403.4 — 403.4 53.0 Go Digit Infoworks Services Private Limited (“Digit”) (1) 49.0 % 479.3 104.4 — 104.4 (11.0) Other — 173.9 139.5 — 139.5 (11.6) 1,069.0 647.3 — 647.3 30.4 Non-insurance: India Bangalore International Airport Limited (“Bangalore Airport”) 54.0 % 1,233.7 — 521.1 521.1 (5.7) Quess Corp Limited (“Quess”) 30.9 % 228.3 459.6 (d) — 459.6 6.8 IIFL Finance Limited (“IIFL Finance”) 22.3 % 493.3 — 242.8 242.8 36.5 Sanmar Chemicals Group (“Sanmar”) 42.9 % 337.8 — 159.8 159.8 36.4 CSB Bank Limited (“CSB Bank”) 49.7 % 223.3 — 194.5 194.5 40.8 IIFL Securities Limited (“IIFL Securities”) 37.1 % 87.9 35.3 97.9 133.2 14.6 Seven Islands Shipping Limited (“Seven Islands”) 48.5 % 96.9 — 97.9 97.9 9.8 Other — 38.0 10.8 28.6 39.4 3.3 2,739.2 505.7 1,342.6 1,848.3 142.5 Real estate KWF Real Estate Ventures Limited Partnerships (“KWF LPs”) — 101.1 101.1 (d) — 101.1 16.5 Other (6) — 61.3 63.3 — 63.3 2.8 162.4 164.4 — 164.4 19.3 Other Eurobank Ergasias Services & Holdings S.A (“Eurobank”) 32.2 % 1,344.5 1,507.6 — 1,507.6 263.0 Atlas Corp. (“Atlas”, formerly Seaspan Corporation) (7) 43.2 % 1,864.7 1,506.3 — 1,506.3 258.2 Resolute Forest Products Inc. (“Resolute”) (8) 32.2 % 508.5 508.5 — 508.5 159.0 Stelco Holdings Inc. (“Stelco”) (9) 23.6 % 423.3 304.8 — 304.8 — EXCO Resources Inc. (“EXCO”) 44.4 % 544.8 288.4 — 288.4 81.9 Helios Fairfax Partners Corporation (“HFP”) 34.4 % 104.1 183.2 — 183.2 (23.9) Peak Achievement Athletics (“Peak Achievement”) 42.6 % 195.3 124.4 (d) — 124.4 7.7 Partnerships, trusts and other — 296.5 350.7 — 350.7 76.6 5,281.7 4,773.9 — 4,773.9 822.5 8,183.3 5,444.0 1,342.6 6,786.6 984.3 Investments in associates 9,252.3 6,091.3 1,342.6 7,433.9 1,014.7 As presented on the consolidated balance sheet: Investments in associates 6,772.9 6,091.3 Fairfax India investments in associates 2,479.4 1,342.6 9,252.3 7,433.9 Year ended December 31, 2021 December 31, Carrying value 2021 Associates Share of Ownership Fair and joint Fairfax India profit percentage (a) value (b) ventures associates (c) Total (loss) Insurance and reinsurance: Gulf Insurance Group K.S.C.P. (“Gulf Insurance”) (2) 43.7 % 409.5 380.0 — 380.0 55.5 Go Digit Infoworks Services Private Limited (“Digit”) 49.0 % 498.3 79.1 — 79.1 5.3 Other (3)(4)(5) — 191.3 148.3 — 148.3 11.8 1,099.1 607.4 — 607.4 72.6 Non-insurance: India Bangalore International Airport Limited (“Bangalore Airport”) (13) 54.0 % 1,372.2 — 585.8 585.8 (45.8) Quess Corp Limited (“Quess”) 31.0 % 528.5 506.3 (d) — 506.3 (1.4) IIFL Finance Limited (“IIFL Finance”) (10) 22.3 % 318.1 — 198.8 198.8 40.6 Sanmar Chemicals Group (“Sanmar”) 42.9 % 421.2 — 124.2 124.2 (2.4) CSB Bank Limited (“CSB Bank”) 49.7 % 227.6 — 180.8 180.8 27.6 IIFL Securities Limited (“IIFL Securities”) 37.2 % 138.0 35.0 101.0 136.0 14.0 Seven Islands Shipping Limited (“Seven Islands”) 48.5 % 105.9 — 98.5 98.5 (0.5) Other — 84.8 10.9 59.8 70.7 0.5 3,196.3 552.2 1,348.9 1,901.1 32.6 Real estate KWF Real Estate Ventures Limited Partnerships (“KWF LPs”) — 76.3 76.3 (d) — 76.3 (9.0) Other — 139.6 140.5 — 140.5 (1.7) 215.9 216.8 — 216.8 (10.7) Other Eurobank Ergasias Services & Holdings S.A (“Eurobank”) 32.2 % 1,210.3 1,298.5 — 1,298.5 162.3 Atlas Corp. (“Atlas”, formerly Seaspan Corporation) (11) 36.7 % 1,285.8 922.1 — 922.1 69.5 Resolute Forest Products Inc. (“Resolute”) 32.3 % 377.1 275.8 — 275.8 75.9 EXCO Resources Inc. (“EXCO”) 43.3 % 267.2 195.4 — 195.4 (41.2) Helios Fairfax Partners Corporation (“HFP”) (12) 34.4 % 116.2 206.1 — 206.1 (1.2) Peak Achievement Athletics (“Peak Achievement”) 42.6 % 181.2 140.5 (d) — 140.5 13.3 Partnerships, trusts and other — 342.1 340.3 — 340.3 28.9 3,779.9 3,378.7 — 3,378.7 307.5 7,192.1 4,147.7 1,348.9 5,496.6 329.4 Investments in associates 8,291.2 4,755.1 1,348.9 6,104.0 402.0 As presented on the consolidated balance sheet: Investments in associates 5,671.9 4,755.1 Fairfax India investments in associates 2,619.3 1,348.9 8,291.2 6,104.0 (a) Ownership percentages include the effects of financial instruments that are considered in-substance equity. (b) See note 5 for fair value hierarchy information. (c) Fairfax India’s associates are domiciled in India. (d) These investments are joint ventures. Insurance and reinsurance associates and joint ventures (1) Digit Insurance and the company applied to the Insurance Regulatory and Development Authority of India (“IRDAI”) for approval to convert the company’s holdings in compulsory convertible preferred shares issued by Digit (“Digit CCPS”) into equity shares of Digit. The IRDAI subsequently communicated that the application could not be considered in its current form as conversion of the Digit CCPS would result in Digit (currently classified as an “Indian promoter” of Digit Insurance) becoming a subsidiary of the company, which was, at such time, prohibited under the then prevailing Indian insurance regulations. Since then, the IRDAI has enacted new regulations that have introduced a definition of a “Foreign Promoter”, which would permit an Indian insurance company (like Digit Insurance) to be a subsidiary of a “Foreign Promoter”. However, Digit does not currently qualify as a “Foreign Promoter” under these new regulations. Digit, Digit Insurance and the company intend to continue to explore all avenues under applicable law to achieve the company’s majority ownership of Digit through conversion of the company’s Digit CCPS. (2) On February 8, 2021 the company entered into an arrangement to purchase (unless sold earlier) certain portfolio investments owned by RiverStone Barbados as described in note 23 and subsequently commenced applying the equity method of accounting to its interest in Gulf Insurance pursuant to that arrangement. (3) On July 14, 2021 the company increased its interest in Eurolife to 80.0% and commenced consolidating Eurolife as described in note 23. (4) On June 17, 2021 the company increased its equity interest in Singapore Re from 28.2% to 94.0% and commenced consolidating Singapore Re as described in note 23. (5) On August 23, 2021 the company completed the sale of its joint venture interest in RiverStone Barbados, pursuant to the transactions described in note 23. Non-insurance associates and joint ventures (6) On July 5, 2022 the company increased its interest in Grivalia Hospitality S.A. (“Grivalia Hospitality”) to 78.4% from 33.5% and commenced consolidating Grivalia Hospitality as described in note 23. (7) On April 6, 2022 the company acquired 25.0 million Atlas common shares by exercising its equity warrants in Atlas with a strike price of $8.05 per share for aggregate cash consideration of $201.3 . On derecognition of the equity warrants, the company recorded a net loss on investment of $37.2 (realized gains of $58.6 , of which $95.8 was recorded as unrealized gains in prior years) and recorded the fair value of these shares of $335.3 as an addition to its equity accounted investment in Atlas. On October 4, 2022, the company increased its interest in Atlas to 43.2% through the purchase of Atlas common shares held through the company’s investment in AVLNs entered with RiverStone Barbados (as described in note 23) for cash consideration of $84.8 . On October 31, 2022 a consortium composed of the company, the Washington Family, David Sokol, Chairman of the Board of Directors of Atlas, and Ocean Network Express Pte. Ltd., a global container, transportation and shipping company (collectively, the “Consortium”), signed a definitive agreement to acquire all of the outstanding common shares of Atlas, other than those shares owned by the Consortium, at a cash purchase price of $15.50, plus payment of all ordinary course quarterly dividends up until closing of the transaction. Pursuant to the transaction, the company would transfer its approximate 45% interest in Atlas, inclusive of the company’s interest through its holdings in Atlas equity warrants that were exercised on January 12, 2023 for cash consideration of $78.7, into Poseidon Acquisitions Corp. (“Poseidon”, an entity formed by the Consortium), and is not obligated to purchase any additional interest not already owned by the Consortium. The other members of the Consortium have committed to fully fund the cash component of the transaction, and the company would continue its ownership in Atlas as part of the Consortium. Closing of the transaction is expected to be in the first half of 2023, and is subject to receipt of regulatory approvals and certain other customary closing conditions. The company expects to continue to apply the equity method of accounting to its interest in Atlas through its interest in Poseidon on closing of the transaction. (8) On July 5, 2022 Domtar Corporation entered into a definitive agreement with Resolute to acquire all outstanding common shares of Resolute for a combination of cash consideration of $20.50 and a Contingent Value Right (“CVR”) per Resolute common share. The CVR provides holders with the right to a share of any future softwood lumber duty deposit refunds. Pursuant to the transaction, on July 5, 2022 the company measured its investment in Resolute as held for sale and ceased applying the equity method of accounting, with the carrying value and fair value of the associate at December 31, 2022 equal to the fair value of the cash consideration of $508.5 or $20.50 per Resolute common share. The transaction closed on March 1, 2023. (9) On August 31, 2022 Stelco Holdings Inc. repurchased 5.1 million of its outstanding common shares under its substantial issuer bid which resulted in the loss of a certain right held by another investor and the company’s ownership interest in Stelco increasing to 20.5% . Accordingly, the company commenced applying the equity method of accounting to its interest in Stelco which had a fair value of $352.2 (Cdn $461.3 ) on that date. Stelco is a publicly listed independent steelmaker that produces flat-rolled, coated, and cold-rolled steel products for the construction, automotive, and energy industries in North America. (10) During 2021 the company reduced its interest in IIFL Finance to 22.3% by selling a portion of its interest for cash proceeds of $113.7 ( 8.6 billion Indian rupees) and recorded a net realized gain of $42.0 in the consolidated statement of earnings. (11) On June 11, 2021 the company entered into an exchange and amendment transaction with Atlas in relation to its investment in $575.0 principal amount of debentures issued by Seaspan Corporation (“Seaspan”), an operating subsidiary of Atlas, whereby the company exchanged $288.0 principal amount of those Seaspan debentures for newly-issued Atlas Series J preferred shares and equity warrants with an exercise price of $13.71 per share. The terms of the remaining Seaspan debentures were amended to primarily remove the company’s mandatory put rights and discharge all outstanding guarantees and liens on collateral. The company derecognized the Seaspan debentures that were exchanged and recorded its investment in the Atlas preferred shares and warrants as preferred stocks and derivatives respectively on the consolidated balance sheet. On August 23, 2021 Atlas redeemed the remaining $287.0 principal amount of the Seaspan debentures. (12) On March 31, 2021 the company invested $100.0 in $100.0 principal amount of Helios Fairfax Partners Corporation (“HFP”) 3.0% unsecured debentures and warrants to purchase 3 million HFP subordinate voting shares exercisable at $4.90 per share any time prior to the fifth anniversary of closing. The debentures will mature on the third anniversary of closing or, at the company’s option, on either the first or second anniversary. At redemption or maturity, if the fair value of certain Fairfax Africa legacy investments held by HFP are below their fair value at June 30, 2020 of $102.6 , the redemption price of the debentures will be reduced by that difference. The company recorded the debentures at their initial fair value of $78.0 and recorded the balance of $22.0 as an addition to its equity accounted investment in HFP. Fairfax India (13) On September 16, 2021 Fairfax India transferred 43.6% out of its 54.0% equity interest in Bangalore Airport to Anchorage Infrastructure Investments Holdings Limited (“Anchorage”), its wholly-owned holding company for investments in the airport sector of India, and sold an 11.5% equity interest in Anchorage to OMERS for gross proceeds of $129.2 ( 9.5 billion Indian rupees). Upon closing Fairfax India recorded a non-controlling interest in Anchorage and continued to equity account for its aggregate 54.0% equity interest in Bangalore Airport. Annual changes in carrying value Changes in the carrying value of investments in associates for the years ended December 31 were as follows: 2022 Fairfax India Associates Joint ventures associates Total Balance - January 1 3,858.7 896.4 1,348.9 6,104.0 Share of pre-tax comprehensive income (loss): Share of profit 856.6 26.1 132.0 1,014.7 Share of other comprehensive income (loss), excluding gains (losses) on defined benefit plans (111.5) (53.0) 14.4 (150.1) Share of gains (losses) on defined benefit plans 74.4 0.6 (5.4) 69.6 819.5 (26.3) 141.0 934.2 Dividends and distributions received (142.2) (33.7) (7.0) (182.9) Purchases and acquisitions 429.1 88.6 10.1 527.8 Divestitures and other net changes in capitalization 9.9 (11.9) 34.4 32.4 Reclassifications (1) 352.2 (114.3) (40.4) 197.5 Foreign exchange effect and other (16.8) (17.9) (144.4) (179.1) Balance - December 31 5,310.4 780.9 1,342.6 7,433.9 2021 Fairfax India Associates Joint ventures associates Total Balance - January 1 3,170.4 1,940.9 1,328.3 6,439.6 Share of pre-tax comprehensive income (loss): Share of profit 375.8 6.0 20.2 402.0 Share of other comprehensive income (loss), excluding gains (losses) on defined benefit plans (67.7) (20.5) 0.3 (87.9) Share of gains (losses) on defined benefit plans 89.1 0.1 (9.4) 79.8 397.2 (14.4) 11.1 393.9 Dividends and distributions received (153.8) (23.6) (4.6) (182.0) Purchases and acquisitions 466.5 114.4 35.7 616.6 Divestitures and other net changes in capitalization (54.8) (764.4) 0.9 (818.3) Reclassifications (1) 36.4 (352.0) — (315.6) Foreign exchange effect and other (3.2) (4.5) (22.5) (30.2) Balance - December 31 3,858.7 896.4 1,348.9 6,104.0 (1) Primarily reflects the consolidation of Grivalia Hospitality and the commencement of the equity method of accounting for Stelco in 2022, and the consolidation of Eurolife and Singapore Re and the commencement of the equity method of accounting for a limited partnership investment in 2021. See note 23. |
Derivatives
Derivatives | 12 Months Ended |
Dec. 31, 2022 | |
Derivatives | |
Derivatives | 7. Derivatives The following table summarizes the company’s derivative financial instruments: December 31, 2022 December 31, 2021 Notional Fair value Notional Fair value amount Cost Assets Liabilities amount Cost Assets Liabilities Equity derivative contracts (1) 1,946.5 68.0 258.1 19.4 1,728.9 113.9 355.3 3.8 RiverStone Barbados AVLNs (note 23) 517.5 — 30.7 — 1,250.1 — 103.8 — Foreign currency derivative contracts (2) — — 49.0 106.8 — — 58.4 77.4 Other derivative contracts — 289.8 130.0 64.8 — 263.3 64.3 71.7 Total 467.8 191.0 581.8 152.9 (1) Includes the company’s investment in Atlas warrants with a fair value at December 31, 2022 of $13.5 (December 31, 2021 - $200.1 ), which were subsequently exercised on January 12, 2023 as described in note 6. (2) Includes AGT’s foreign currency forward and swap liabilities with a fair value at December 31, 2022 of $56.2 (December 31, 2021 - $47.6 ). The company is exposed to significant market risk (comprised of foreign currency risk, interest rate risk and other price risk) through its investing activities. Derivative contracts entered into by the company, with limited exceptions, are considered investments or economic hedges and are not designated as hedges for financial reporting. Equity derivative contracts Long equity total return swaps During 2022 the company entered into $217.4 notional amount of long equity total return swaps for investment purposes. At December 31, 2022 the company held long equity total return swaps on individual equities for investment purposes with an original notional amount of $1,012.6 (December 31, 2021 - $866.2), which included an aggregate of 1,964,155 Fairfax subordinate voting shares with an original notional amount of $732.5 (Cdn$935.0) or approximately $372.96 (Cdn $476.03) per share at December 31, 2022 and 2021. During 2022 the long equity total return swaps on Fairfax subordinate voting shares produced net gains of $255.4 (2021 - $222.7). Long equity total return swaps provide a return which is directly correlated to changes in the fair values of the underlying individual equities. During 2022 the company received net cash of $238.2 (2021 - $439.6) in connection with the closures and reset provisions of its long equity total return swaps (excluding the impact of collateral requirements). During 2022 the company closed out $63.0 notional amount (2021 - $1,876.7) of its long equity total return swaps and recorded net realized losses on investments of $8.1 (2021 -net realized gains of $243.0). RiverStone Barbados Asset Value Loan Notes Pursuant to the sale of RiverStone Barbados in 2021 as described in note 23, the company, through financial instruments referred to as AVLNs, had guaranteed the then value of approximately $1.3 billion of certain securities held by the purchaser and certain affiliates thereof until such time that the securities are purchased by or sold at the direction of Hamblin Watsa, prior to the end of 2022. Should the company direct that the securities be sold, any difference between their fair value and guaranteed value will be settled in cash. On July 5, 2022 AVLNs with a guaranteed value of $543.4 were amended such that the underlying securities must be purchased by or sold at the direction of Hamblin Watsa prior to the end of 2023. The remainder of the AVLNs were unchanged and during 2022 all securities that were required to be purchased by or sold at the direction of Hamblin Watsa prior to the end of 2022 pursuant to the terms of the amended agreement were re-acquired, and in addition, certain of the amended AVLNs were purchased in the second half of 2022. At December 31, 2022 the fair value of the AVLNs was a derivative asset of $30.7 (December 31, 2021 – $103.8), with a remaining guaranteed value of $486.8. Foreign currency derivative contracts Foreign currency forward contracts Long and short foreign currency forward contracts, primarily denominated in the euro, the British pound sterling and the Canadian dollar, are used to manage certain foreign currency exposures arising from foreign currency denominated transactions. These contracts have an average term to maturity of less than one year and may be renewed at market rates. Other derivative contracts U.S. treasury bond forward contracts To reduce its exposure to interest rate risk (primarily exposure to certain long dated U.S. corporate bonds and U.S. state and municipal bonds held in its fixed income portfolio), the company held forward contracts to sell long dated U.S. treasury bonds with a notional amount at December 31, 2022 of $183.7 (December 31, 2021 - $1,691.3). The decrease in U.S. treasury bond forward contracts held primarily reflected the closing of certain contracts as interest rates increased during the second half of 2022 and from the corresponding decrease in the company’s exposure to certain U.S. corporate bonds from sales completed in late 2021. These contracts have an average term to maturity of less than six months, and may be renewed at market rates. During 2022 the company recorded net gains on investments of $162.4 (2021 - $25.7) on its U.S. treasury bond forward contracts. Counterparty collateral Collateral deposits on derivative contracts for the benefit of the company The company endeavours to limit counterparty risk through diligent selection of counterparties to its derivative contracts and through the terms of negotiated agreements. The fair value of collateral deposited for the benefit of the company at December 31, 2022 consisted of cash of $9.5 and government securities of $274.9 (December 31, 2021 - $14.3 and $125.7). The cash is recorded on the consolidated balance sheet in subsidiary cash and short term investments with a corresponding liability recorded in accounts payable and accrued liabilities. The company had not exercised its right to sell or repledge collateral at December 31, 2022. The company’s exposure to counterparty risk and the management thereof are discussed in note 24. Collateral deposits on derivative contracts for the benefit of the derivative counterparties At December 31, 2022 the fair value of collateral deposited for the benefit of derivative counterparties included in holding company cash and investments and in assets pledged for derivative obligations was $155.9 (December 31, 2021 - $230.5), comprised of collateral of $124.8 (December 31, 2021 - $221.2) required to be deposited to enter into such derivative contracts (principally related to total return swaps), and collateral of $31.1 (December 31, 2021 - $9.3) securing amounts owed to counterparties in respect of fair value changes since the most recent reset date. Hedge of net investment in Canadian subsidiaries At December 31, 2022 the company had designated the carrying value of Cdn$2,800.0 principal amount of its Canadian dollar denominated unsecured senior notes with a fair value of $1,926.8 (December 31, 2021 – principal amount of Cdn$2,800.0 with a fair value of $2,364.6) as a hedge of a portion of its net investment in subsidiaries with a Canadian dollar functional currency. During 2022 the company recognized pre-tax gains of $149.5 (2021 - pre-tax losses of $16.7) related to exchange rate movements on the Canadian dollar denominated unsecured senior notes in gains (losses) on hedge of net investment in Canadian subsidiaries in the consolidated statement of comprehensive income. Hedge of net investment in European operations At December 31, 2022 the company had designated the carrying value of €750.0 principal amount of its euro denominated unsecured senior notes with a fair value of $698.3 (December 31, 2021 – principal amount of €750.0 with a fair value of $926.3) as a hedge of its net investment in European operations with a euro functional currency. During 2022 the company recognized pre-tax gains of $51.8 (2021 – $63.9) related to exchange rate movements on the euro denominated unsecured senior notes in gains on hedge of net investment in European operations in the consolidated statement of comprehensive income. |
Insurance Contract Liabilities
Insurance Contract Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Insurance Contract Liabilities | |
Insurance Contract Liabilities | 8. Insurance Contract Liabilities December 31, 2022 December 31, 2021 Gross Ceded Net Gross Ceded Net Provision for unearned premiums 11,691.8 2,413.1 9,278.7 10,437.7 2,260.0 8,177.7 Provision for losses and loss adjustment expenses 38,319.2 9,245.9 29,073.3 34,422.8 8,943.9 25,478.9 Property and casualty insurance contract liabilities 50,011.0 11,659.0 38,352.0 44,860.5 11,203.9 33,656.6 Provision for life policy benefits (1)(2) 2,188.6 2.6 2,186.0 2,486.0 2.3 2,483.7 Insurance contract liabilities 52,199.6 11,661.6 40,538.0 47,346.5 11,206.2 36,140.3 Current 23,807.9 5,052.4 18,755.5 20,618.3 4,740.3 15,878.0 Non-current 28,391.7 6,609.2 21,782.5 26,728.2 6,465.9 20,262.3 52,199.6 11,661.6 40,538.0 47,346.5 11,206.2 36,140.3 (1) Eurolife was consolidated on July 14, 2021 as described in note 23. (2) Provision for life policy benefits includes gross and ceded provisions for unearned premiums of $18.2 and $0.4 (2021 - $16.5 and nil ). At December 31, 2022 the company’s net provision for losses and loss adjustment expenses of $29,073.3 (December 31, 2021 - $25,478.9) was comprised of case reserves of $10,933.9 and IBNR of $18,139.4 (December 31, 2021 - $10,258.5 and $15,220.4). Provision for unearned premiums, gross Changes in the property and casualty provision for unearned premiums for the years ended December 31 were as follows: 2022 2021 Provision for unearned premiums – January 1 10,437.7 8,397.5 Gross premiums written 27,561.7 23,796.0 Less: gross premiums earned (26,106.7) (21,673.6) Acquisitions of subsidiaries (note 23) — 64.1 Divestiture of subsidiary — (62.9) Foreign exchange effect and other (200.9) (83.4) Provision for unearned premiums - December 31 11,691.8 10,437.7 Provision for losses and loss adjustment expenses, gross Changes in the property and casualty provision for losses and loss adjustment expenses for the years ended December 31 were as follows: 2022 2021 Provision for losses and loss adjustment expenses – January 1 34,422.8 30,809.3 Decrease in estimated losses and expenses for claims occurring in the prior years (44.0) (283.1) Losses and expenses for claims occurring in the current year 17,300.2 14,396.8 Paid on claims occurring during: the current year (3,978.6) (3,148.6) the prior years (8,734.7) (7,212.8) Acquisitions of subsidiaries (note 23) 3.8 297.3 Divestiture of subsidiary — (18.7) Foreign exchange effect and other (1) (650.3) (417.4) Provision for losses and loss adjustment expenses – December 31 38,319.2 34,422.8 (1) Foreign exchange effect and other principally reflected the decrease of reserves denominated in the Canadian dollar, British pound, euro and Argentinian peso which weakened against the U.S. dollar (2021 - principally reflected the decrease of reserves denominated in the euro, Chilean peso, Argentinian peso, Colombian peso and South African rand which weakened against the U.S. dollar). Provision for life policy benefits Changes in the provision for life policy benefits for the years ended December 31, following the acquisition of Eurolife on July 14, 2021, were as follows: 2022 2021 Provision for life policy benefits – January 1 2,486.0 — Acquisition of subsidiary (note 23) — 2,638.5 New business and renewals 275.9 78.1 Surrenders, lapses, maturities and deaths (359.4) (121.0) Foreign exchange effect and other (1) (213.9) (109.6) Provision for life policy benefits – December 31 2,188.6 2,486.0 (1) Foreign exchange effect and other principally reflected the depreciation of euro denominated reserves against the U.S. dollar. Development of insurance losses, gross The development of insurance liabilities illustrates the estimation uncertainty associated with these liabilities and provides a measure of the company’s ability to estimate the ultimate value of claims. The loss development table below shows the provision for losses and loss adjustment expenses at the end of each calendar year, the cumulative payments made in respect of those reserves in subsequent years and the re-estimated amount of each calendar year’s provision for losses and loss adjustment expenses as at December 31, 2022. Calendar year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Property and casualty provision for losses and loss adjustment expenses 19,212.8 17,749.1 19,816.4 19,481.8 28,610.8 29,081.7 28,500.2 30,809.3 34,422.8 38,319.2 Less: CTR Life (1) 17.9 15.2 14.2 12.8 8.7 8.0 7.0 5.5 4.4 4.4 19,194.9 17,733.9 19,802.2 19,469.0 28,602.1 29,073.7 28,493.2 30,803.8 34,418.4 38,314.8 Cumulative payments as of: One year later 4,081.1 3,801.6 4,441.4 4,608.0 7,564.0 7,732.0 7,288.8 7,180.7 8,734.7 Two years later 6,787.6 6,364.5 7,283.6 7,631.4 12,081.3 12,313.5 11,598.0 12,501.3 Three years later 8,775.5 8,172.7 9,466.5 9,655.9 15,222.3 15,363.3 15,475.2 Four years later 10,212.4 9,561.8 10,914.2 11,122.6 17,378.8 18,132.3 Five years later 11,354.4 10,496.4 12,013.9 12,233.4 13,340.9 Six years later 12,123.4 11,202.2 12,859.5 13,196.6 Seven years later 12,754.2 11,793.5 13,568.0 Eight years later 13,283.6 12,390.7 Nine years later 13,840.6 Reserves re-estimated as of: One year later 18,375.6 16,696.4 19,169.3 19,343.1 27,580.6 28,974.3 28,225.5 30,360.1 33,931.1 Two years later 17,475.0 16,269.2 18,973.6 18,804.8 27,565.9 28,839.4 28,165.4 30,267.4 Three years later 17,307.9 16,114.0 18,502.5 18,752.8 27,451.3 28,990.4 28,242.2 Four years later 17,287.2 15,938.9 18,469.1 18,743.9 27,698.6 29,284.5 Five years later 17,203.5 16,049.6 18,490.5 19,046.6 27,977.0 Six years later 17,340.1 16,123.1 18,759.5 19,203.7 Seven years later 17,420.0 16,403.8 18,866.6 Eight years later 17,680.5 16,595.5 Nine years later 17,843.1 Favourable (adverse) development 1,351.8 1,138.4 935.6 265.3 605.1 (210.8) 251.0 536.4 487.3 Favourable development comprised of: Effect of foreign currency translation 522.8 326.8 (129.1) (84.5) 759.2 395.7 452.9 425.6 443.3 Favourable (adverse) loss reserve development 829.0 811.6 1,064.7 349.8 (154.1) 606.5 (201.9) 110.8 44.0 1,351.8 1,138.4 935.6 265.3 605.1 (210.8) 251.0 536.4 487.3 (1) Guaranteed minimum death benefit retrocessional business written by Compagnie Transcontinentale de Réassurance (“CTR Life”), a wholly owned subsidiary of the company that was transferred to Wentworth and placed into run-off in 2002. The effect of foreign currency translation in the table above primarily arose on translation to U.S. dollars of loss reserves of subsidiaries with functional currencies other than the U.S. dollar. The company’s exposure to foreign currency risk and the management thereof are discussed in note 24. Loss reserve development in the table above excludes the loss reserve development of a subsidiary in the year it is acquired whereas the consolidated statement of earnings includes the loss reserve development of a subsidiary from its acquisition date. Favourable loss reserve development in calendar year 2022 of $44.0 in the table above was principally comprised of favourable loss emergence on accident years 2021, 2020 and 2019, partially offset by adverse development primarily related to asbestos and other latent claims liabilities. Development of losses and loss adjustment expenses for asbestos A number of the company’s subsidiaries wrote general liability policies and reinsurance prior to their acquisition by the company under which policyholders continue to present asbestos-related injury claims. Substantially all of these claims are presented under policies written many years ago and reside primarily within U.S. Run-off. There is a great deal of uncertainty surrounding these types of claims, which affects the ability of insurers and reinsurers to estimate the ultimate amount of unpaid claims and related settlement expenses. The majority of these claims differ from most other types of claims because there is inconsistent precedent, if any at all, to determine what, if any, coverage exists or which, if any, policy years and insurers or reinsurers may be liable. These uncertainties are exacerbated by judicial and legislative interpretations of coverage that in some cases have eroded the clear and express intent of the parties to the insurance contracts, and in others have expanded theories of liability. Changes in the company’s provision for losses and loss adjustment expenses related to U.S. asbestos exposure on a gross and net basis for the years ended December 31 were as follows: 2022 2021 Gross Net Gross Net Provision for asbestos claims and loss adjustment expenses - January 1 1,036.7 838.9 1,030.6 840.0 Losses and loss adjustment expenses incurred 215.8 113.7 199.1 151.6 Losses and loss adjustment expenses paid (175.2) (132.5) (193.0) (152.7) Provision for asbestos claims and loss adjustment expenses - December 31 1,077.3 820.1 1,036.7 838.9 |
Reinsurance
Reinsurance | 12 Months Ended |
Dec. 31, 2022 | |
Reinsurance | |
Reinsurance | 9. Reinsurance Reinsurers’ share of insurance contract liabilities was comprised as follows: December 31, 2022 December 31, 2021 Gross Provision for Recoverable Gross Provision for Recoverable recoverable from uncollectible from recoverable from uncollectible from reinsurers reinsurance (1) reinsurers reinsurers reinsurance (1) reinsurers Provision for losses and loss adjustment expenses 9,274.8 (26.7) 9,248.1 8,989.3 (43.1) 8,946.2 Reinsurers’ share of paid losses 1,599.4 (145.2) 1,454.2 1,019.9 (135.6) 884.3 Provision for unearned premiums 2,413.5 — 2,413.5 2,260.0 — 2,260.0 13,287.7 (171.9) 13,115.8 12,269.2 (178.7) 12,090.5 Current 6,414.4 5,572.4 Non-current 6,701.4 6,518.1 13,115.8 12,090.5 (1) Management of credit risk on reinsurance recoverables is discussed in note 24. Changes in reinsurers’ share of paid losses, unpaid losses and unearned premiums, and the provision for uncollectible reinsurance for the years ended December 31 were as follows: 2022 Provision for Recoverable Paid Unpaid Unearned uncollectible from losses losses premiums reinsurance reinsurers Balance – January 1 1,019.9 8,989.3 2,260.0 (178.7) 12,090.5 Reinsurers’ share of losses paid to insureds 3,142.8 (3,142.8) — — — Reinsurance recoveries received (2,551.0) — — — (2,551.0) Reinsurers’ share of unpaid losses and premiums earned — 3,642.0 (5,448.8) — (1,806.8) Premiums ceded to reinsurers — — 5,640.9 — 5,640.9 Foreign exchange effect and other (12.3) (213.7) (38.6) 6.8 (257.8) Balance – December 31 1,599.4 9,274.8 2,413.5 (171.9) 13,115.8 2021 Provision for Recoverable Paid Unpaid Unearned uncollectible from losses losses premiums reinsurance reinsurers Balance – January 1 818.0 7,971.7 1,899.1 (155.6) 10,533.2 Reinsurers’ share of losses paid to insureds 2,360.3 (2,360.3) — — — Reinsurance recoveries received (2,152.8) — — — (2,152.8) Reinsurers’ share of unpaid losses and premiums earned (1) — 3,479.0 (5,228.8) — (1,749.8) Premiums ceded to reinsurers (1) — — 5,632.1 — 5,632.1 Acquisitions of subsidiaries (note 23) 0.3 82.7 16.7 — 99.7 Divestiture of subsidiary (3.3) (6.4) (10.6) — (20.3) Foreign exchange effect and other (2.6) (177.4) (48.5) (23.1) (251.6) Balance – December 31 1,019.9 8,989.3 2,260.0 (178.7) 12,090.5 (1) Effective October 1, 2021 Brit completed a loss portfolio transfer with a third party to reinsure loss reserves for a portfolio of risks predominantly comprised of U.S. casualty and discontinued lines of business relating to prior accident years. Pursuant to this transaction Brit ceded net insurance contract liabilities of $379.1 for consideration of $344.1 and recorded net favourable reserve development of $35.0 . Commission income earned on premiums ceded to reinsurers in 2022 of $1,184.4 (2021 - $1,007.8) is included in commissions, net in the consolidated statement of earnings. |
Insurance Contract Receivables
Insurance Contract Receivables and Payables | 12 Months Ended |
Dec. 31, 2022 | |
Insurance Contract Receivables and Payables | |
Insurance Contract Receivables and Payables | 10. Insurance Contract Receivables and Payables Insurance contract receivables were comprised as follows: December 31, December 31, 2022 2021 Insurance premiums receivable 4,972.7 4,247.1 Reinsurance premiums receivable 2,114.6 1,863.9 Funds withheld receivable 550.6 574.0 Other 269.6 198.2 7,907.5 6,883.2 Current 7,330.0 6,170.0 Non-current 577.5 713.2 7,907.5 6,883.2 Changes in insurance premiums receivable and reinsurance premiums receivable for the years ended December 31 were as follows: Insurance Reinsurance premiums receivable premiums receivable 2022 2021 2022 2021 Balance – January 1 4,247.1 3,665.6 1,863.9 1,385.3 Gross premiums written 20,516.3 18,118.6 7,396.3 5,791.6 Premiums collected (17,571.5) (15,703.6) (5,366.6) (3,963.7) Amounts due to brokers and agents (2,089.4) (1,770.1) (1,806.1) (1,332.3) Foreign exchange effect and other (129.8) (63.4) 27.1 (17.0) Balance – December 31 4,972.7 4,247.1 2,114.6 1,863.9 Insurance contract payables were comprised as follows: December 31, December 31, 2022 2021 Payable to reinsurers 2,289.1 2,333.7 Payables associated with unit-linked life insurance products (note 3 and note 23) 662.5 621.7 Ceded deferred premium acquisition costs 564.6 510.3 Funds withheld payable to reinsurers 193.5 274.0 Amounts payable to agents and brokers 112.5 142.4 Accrued premium taxes 105.7 124.1 Accrued commissions 157.8 100.8 Other insurance contract payables 976.2 386.5 5,061.9 4,493.5 Current 4,101.0 3,503.4 Non-current 960.9 990.1 5,061.9 4,493.5 |
Deferred Premium Acquisition Co
Deferred Premium Acquisition Costs | 12 Months Ended |
Dec. 31, 2022 | |
Deferred Premium Acquisition Costs | |
Deferred Premium Acquisition Costs | 11. Deferred Premium Acquisition Costs Changes in deferred premium acquisition costs for the years ended December 31 were as follows: 2022 2021 Balance – January 1 1,924.1 1,543.7 Premium acquisition costs deferred 5,212.5 4,502.4 Amortization (4,932.2) (4,098.1) Foreign exchange effect and other (34.1) (23.9) Balance – December 31 2,170.3 1,924.1 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | 12. Goodwill and Intangible Assets Goodwill and intangible assets were comprised as follows: Goodwill Intangible assets Total Lloyd’s Customer Computer participation and broker Brand software rights (1) relationships names (1) and other (1) Balance - January 1, 2022 3,084.8 503.2 760.9 1,087.3 492.0 5,928.2 Additions 152.0 — 25.9 (0.3) 267.6 445.2 Disposals (2) (81.9) — (31.6) (8.5) (3.2) (125.2) Amortization — — (91.7) — (134.9) (226.6) Impairments (3) (137.0) — — — (0.9) (137.9) Foreign exchange effect and other (90.4) — (9.6) (60.2) (34.5) (194.7) Balance - December 31, 2022 2,927.5 503.2 653.9 1,018.3 586.1 5,689.0 Gross carrying amount 3,161.8 503.2 1,279.0 1,060.1 1,594.2 7,598.3 Accumulated amortization — — (631.6) — (988.3) (1,619.9) Accumulated impairment and other (234.3) — 6.5 (41.8) (19.8) (289.4) 2,927.5 503.2 653.9 1,018.3 586.1 5,689.0 Goodwill Intangible assets Total Lloyd’s Customer Computer participation and broker Brand software rights (1) relationships names (1) and other (1) Balance - January 1, 2021 3,126.3 503.2 867.5 1,153.3 578.8 6,229.1 Additions 60.7 — 17.8 27.9 264.3 370.7 Disposals (2) (28.9) — (25.1) (64.0) (7.5) (125.5) Amortization — — (96.6) — (342.8) (439.4) Impairments (3) (52.1) — — (33.1) (0.1) (85.3) Foreign exchange effect and other (21.2) — (2.7) 3.2 (0.7) (21.4) Balance - December 31, 2021 3,084.8 503.2 760.9 1,087.3 492.0 5,928.2 Gross carrying amount 3,214.1 503.2 1,338.5 1,139.2 1,427.0 7,622.0 Accumulated amortization — — (577.4) — (915.4) (1,492.8) Accumulated impairment (129.3) — (0.2) (51.9) (19.6) (201.0) 3,084.8 503.2 760.9 1,087.3 492.0 5,928.2 (1) Indefinite-lived intangible assets not subject to amortization had an aggregate carrying value at December 31, 2022 of $1,613.6 (December 31, 2021 - $1,686.2 ). (2) During 2022 the company sold its interests in the Crum & Forster Pet Insurance Group and Pethealth. During 2021 the company sold the operations of Toys “R” Us Canada and Fairfax India sold its 48.8% equity interest in Privi. See note 23. (3) Non-cash impairment charges recorded in operating expenses and in other expenses in the consolidated statement of earnings by the insurance and reinsurance companies and Non-insurance companies reporting segment, respectively. During 2022 the company recognized non-cash goodwill impairment charges of $133.4 on Farmers Edge. Goodwill and intangible assets were allocated to the company’s cash-generating units (“CGUs”) as follows: December 31, 2022 December 31, 2021 Intangible Intangible Goodwill assets Total Goodwill assets Total Insurance and reinsurance companies Allied World 940.0 519.8 1,459.8 940.0 565.8 1,505.8 Brit 214.6 565.5 780.1 215.6 580.5 796.1 Zenith National 317.6 77.7 395.3 317.6 84.4 402.0 Northbridge 81.6 133.5 215.1 94.9 121.3 216.2 Crum & Forster 132.6 57.8 190.4 189.1 91.0 280.1 Odyssey Group 119.7 50.8 170.5 119.7 54.9 174.6 All other (1) 85.1 108.3 193.4 95.9 116.3 212.2 1,891.2 1,513.4 3,404.6 1,972.8 1,614.2 3,587.0 Non-insurance companies Recipe 298.9 902.2 1,201.1 321.2 980.5 1,301.7 Boat Rocker 86.4 184.8 271.2 89.1 90.2 179.3 AGT 147.6 49.6 197.2 154.4 34.9 189.3 Thomas Cook India 127.7 48.4 176.1 142.1 54.5 196.6 Farmers Edge 63.3 11.4 74.7 208.3 16.0 224.3 All other (2) 312.4 51.7 364.1 196.9 53.1 250.0 1,036.3 1,248.1 2,284.4 1,112.0 1,229.2 2,341.2 2,927.5 2,761.5 5,689.0 3,084.8 2,843.4 5,928.2 (1) Comprised primarily of balances related to AMAG Insurance, Eurolife and Pacific Insurance. (2) Comprised primarily of balances related to Dexterra Group, Fairfax India’s subsidiaries (principally from the 2022 acquisitions of Maxop and Jaynix), Grivalia Hospitality (consolidated on July 5, 2022) and Sterling Resorts, and in 2021 included Pethealth (deconsolidated on October 31, 2022). Impairment tests for goodwill and indefinite-lived intangible assets were completed during 2022 and it was concluded that no significant impairments had occurred, other than non-cash goodwill impairment charges on Farmers Edge of $133.4 which were recognized in 2022. When testing for impairment, the recoverable amount of each CGU or group of CGUs was based on the higher of (i) fair value less costs of disposal, determined using market prices inclusive of a control premium or discounted cash flow models, and (ii) value-in-use, determined using discounted cash flow models. In preparing discounted cash flow models, cash flow projections typically covering a five year period were derived from financial budgets approved by management. Cash flows beyond the projected periods were extrapolated using estimated growth rates which do not exceed the long term average historic growth rate for the business in which each CGU operates. A number of other assumptions and estimates including premiums, investment returns, revenues, expenses, royalty rates and working capital requirements were required to be incorporated into the discounted cash flow models. The forecasts were based on best estimates of future premiums or revenues and operating expenses using historical trends, general geographical market conditions, industry trends and forecasts and other available information. These assumptions and estimates were reviewed by the applicable CGU’s management and by Fairfax management. The cash flow forecasts were adjusted by applying appropriate discount rates within a range of 9.3% to 13.7% for insurance and reinsurance subsidiaries, and 10.5% to 16.9% for non-insurance subsidiaries. A long term investment return of 5.0% was applied to the investment portfolios of insurance and reinsurance subsidiaries. The long term growth rates used to extrapolate cash flows beyond five years for the majority of the CGUs ranged from 3.0% to 3.7%. |
Other Assets
Other Assets | 12 Months Ended |
Dec. 31, 2022 | |
Other Assets | |
Other Assets | 13. Other assets were comprised as follows: December 31, 2022 December 31, 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total Premises and equipment, right-of-use assets (note 22) and non-insurance companies’ investment property (2) 684.0 2,199.7 2,883.7 725.6 1,558.4 2,284.0 Assets associated with unit-linked insurance products (note 3 and note 23) 676.5 — 676.5 637.1 — 637.1 Inventories — 668.2 668.2 — 547.3 547.3 Other revenue receivables — 638.9 638.9 — 508.4 508.4 Accrued interest and dividends 313.7 3.5 317.2 211.4 3.7 215.1 Income tax, sales tax and subsidies receivable 71.3 204.6 275.9 61.6 170.3 231.9 Prepaid expenses 111.0 134.8 245.8 110.9 94.9 205.8 Finance lease receivables (note 22) 8.8 218.0 226.8 9.4 256.7 266.1 Prepaid losses on claims 168.9 — 168.9 129.4 — 129.4 Pension surplus (note 21) 144.5 — 144.5 113.8 — 113.8 Receivable for securities sold but not yet settled 11.2 — 11.2 135.4 — 135.4 Other (3) 738.5 85.6 824.1 791.1 55.9 847.0 2,928.4 4,153.3 7,081.7 2,925.7 3,195.6 6,121.3 Current 993.9 1,632.6 2,626.5 989.9 1,343.7 2,333.6 Non-current 1,934.5 2,520.7 4,455.2 1,935.8 1,851.9 3,787.7 2,928.4 4,153.3 7,081.7 2,925.7 3,195.6 6,121.3 (1) Includes Life insurance and Run-off, and Corporate and Other. (2) The increase during 2022 principally reflected the consolidation of Grivalia Hospitality and its hospitality real estate as described in note 23. (3) Principally comprised of other receivables, deposits and deferred compensation plans. |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Accounts Payable and Accrued Liabilities | |
Accounts Payable and Accrued Liabilities | 14. Accounts payable and accrued liabilities were comprised as follows: December 31, 2022 December 31, 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total Lease liabilities (note 22) 364.1 729.9 1,094.0 384.2 756.5 1,140.7 Payables related to cost of sales — 814.3 814.3 — 580.9 580.9 Salaries and employee benefit liabilities 500.5 98.5 599.0 482.6 85.6 568.2 Amounts withheld and accrued taxes 455.8 30.7 486.5 453.9 23.8 477.7 Deferred gift card, hospitality and other revenue 37.8 392.0 429.8 35.4 318.5 353.9 Income taxes payable 347.0 14.0 361.0 163.8 11.2 175.0 Pension and post retirement liabilities (note 21) 132.9 12.8 145.7 237.4 16.5 253.9 Administrative and other (2) 946.6 338.3 1,284.9 1,150.9 284.2 1,435.1 2,784.7 2,430.5 5,215.2 2,908.2 2,077.2 4,985.4 Current 1,528.4 1,553.3 3,081.7 1,538.7 1,177.2 2,715.9 Non-current 1,256.3 877.2 2,133.5 1,369.5 900.0 2,269.5 2,784.7 2,430.5 5,215.2 2,908.2 2,077.2 4,985.4 (1) Includes Life insurance and Run-off and Corporate and Other. (2) Principally comprised of accrued operating expenses, advances from customers and liabilities related to business acquisitions . |
Borrowings
Borrowings | 12 Months Ended |
Dec. 31, 2022 | |
Borrowings | |
Borrowings | 15. December 31, 2022 December 31, 2021 Principal Carrying Fair Principal Carrying Fair value (a) value (b) value (a) value (b) Borrowings - holding company Fairfax unsecured notes (d) 4.875% due August 13, 2024 282.5 281.6 277.0 282.5 281.1 301.7 4.95% due March 3, 2025 (Cdn$350.0) 258.3 257.2 255.2 277.1 275.4 299.6 8.30% due April 15, 2026 (e) 91.8 91.7 98.2 91.8 91.7 113.3 4.70% due December 16, 2026 (Cdn$450.0) 332.1 331.0 323.7 356.3 354.8 387.9 4.25% due December 6, 2027 (Cdn$650.0) 479.7 478.6 455.8 514.6 513.1 551.4 2.75% due March 29, 2028 (€750.0) 800.5 792.2 698.3 852.9 842.4 926.3 4.85% due April 17, 2028 600.0 596.9 568.1 600.0 596.3 668.5 4.23% due June 14, 2029 (Cdn$500.0) 369.0 367.7 342.7 395.8 394.2 424.4 4.625% due April 29, 2030 650.0 646.4 591.1 650.0 645.9 730.0 3.375% due March 3, 2031 600.0 586.8 492.8 600.0 585.1 620.7 3.95% due March 3, 2031(Cdn$850.0) 627.4 623.2 549.4 672.9 668.0 701.3 5.625% due August 16, 2032 (1) 750.0 743.6 707.1 — — — 7.75% due July 15, 2037 (e) 91.3 90.7 95.2 91.3 90.6 125.4 Revolving credit facility (2) — — — — — — 5,932.6 5,887.6 5,454.6 5,385.2 5,338.6 5,850.5 Borrowings - insurance and reinsurance companies Allied World 4.35% senior notes due October 29, 2025 500.0 502.9 477.7 500.0 503.9 536.9 Allied World revolving credit facility and other borrowings 16.8 19.8 16.9 17.4 20.6 21.1 Zenith National 8.55% debentures due August 1, 2028 (d) 38.5 38.3 38.5 38.5 38.3 38.3 Brit 3.6757% subordinated notes due December 9, 2030 (£135.0) 162.4 162.4 120.6 182.9 182.9 174.5 Brit floating rate revolving credit facility 10.0 10.0 10.0 45.0 45.0 45.0 727.7 733.4 663.7 783.8 790.7 815.8 Borrowings - non-insurance companies (c) Fairfax India 5.00% unsecured senior notes due 2028 441.6 438.9 400.7 441.6 438.4 440.3 Fairfax India subsidiary borrowings 122.6 122.2 122.2 91.9 91.3 91.3 AGT credit facilities, senior notes and loans (3) 511.9 508.4 498.8 491.8 488.9 488.9 Recipe term loans and credit facilities (4) 464.0 461.5 436.7 359.0 356.9 356.9 Boat Rocker demand loans and revolving credit facilities 155.4 155.2 155.4 93.8 93.1 93.1 Loans and revolving credit facilities primarily at floating rates (5) 317.7 317.7 317.7 155.2 155.1 155.1 2,013.2 2,003.9 1,931.5 1,633.3 1,623.7 1,625.6 Total debt 8,673.5 8,624.9 8,049.8 7,802.3 7,753.0 8,291.9 ( a) Principal net of unamortized issue costs and discounts (premiums). (b) Based principally on quoted market prices with the remainder based on discounted cash flow models using market observable inputs (Levels 1 and 2 respectively in the fair value hierarchy). (c) These borrowings are non-recourse to the holding company. (d) Issuer may redeem any time at prices specified in the instrument’s offering document, except those disclosed in footnote (e) below. (e) Not redeemable prior to the contractual maturity date. During 2022 the company and its subsidiaries completed the following debt transactions: Holding company (1) On August 16, 2022 the company completed an offering of $750.0 principal amount of 5.625% unsecured senior notes due August 16, 2032 for net proceeds of $743.4 after discount, commissions and expenses. Commissions and expenses of $5.5 were included in the carrying value of the notes. (2) On June 29, 2022 the company amended and restated its $2.0 billion unsecured revolving credit facility with a syndicate of lenders on substantially the same terms which extended the expiry from June 29, 2026 to June 29, 2027. At December 31, 2022 and 2021, the revolving credit facility was undrawn and the company was in compliance with its financial covenants. Non-insurance companies (3) On December 28, 2022 AGT extended the maturity of its credit facilities to March 17, 2024. (4) Recipe increased its borrowings during 2022 principally as a result of the privatization transaction described in note 23. (5) On July 5, 2022 the company consolidated Grivalia Hospitality as described in note 23, including its borrowings of $111.3 at December 31, 2022. Changes in the carrying values of borrowings for the years ended December 31 were as follows: 2022 2021 Insurance Insurance and Non- and Non- Holding reinsurance insurance Holding reinsurance insurance company companies companies Total company companies companies Total Balance – January 1 5,338.6 790.7 1,623.7 7,753.0 5,580.6 1,033.4 2,200.0 8,814.0 Cash inflows from issuances 743.4 — 47.0 790.4 1,250.0 — 499.1 1,749.1 Cash outflows from repayments — (0.3) (25.3) (25.6) (801.2) (131.7) (593.9) (1,526.8) Net cash inflows (outflows) from credit facilities and short term loans — (35.0) 304.1 269.1 (700.0) (84.3) (262.0) (1,046.3) Non-cash changes: Acquisition of subsidiaries (note 23) — — 137.1 137.1 — — — — Deconsolidation of subsidiary (note 23) — — — — — (22.5) (187.4) (209.9) Loss on redemption — — — — 45.7 — (0.1) 45.6 Foreign exchange effect and other (194.4) (22.0) (82.7) (299.1) (36.5) (4.2) (32.0) (72.7) Balance – December 31 5,887.6 733.4 2,003.9 8,624.9 5,338.6 790.7 1,623.7 7,753.0 Principal repayments on borrowings are due as follows: 2023 2024 2025 2026 2027 Thereafter Total Holding company — 282.5 258.3 423.9 479.7 4,488.2 5,932.6 Insurance and reinsurance companies 0.3 0.3 510.3 0.3 0.3 216.2 727.7 Non-insurance companies 371.8 748.2 33.7 30.9 30.4 798.2 2,013.2 Total 372.1 1,031.0 802.3 455.1 510.4 5,502.6 8,673.5 Interest Expense Interest expense in 2022 of $452.8 (2021 – $513.9) was comprised of interest on borrowings by the holding company and the insurance and reinsurance companies of $316.1 (2021 - $356.8, inclusive of a loss on redemption of holding company unsecured senior notes of $45.7), interest on borrowings by the non-insurance companies (which are non-recourse to the holding company) of $89.8 (2021 – $99.2) and accretion of lease liabilities of $46.9 (2021 - $57.9). |
Total Equity
Total Equity | 12 Months Ended |
Dec. 31, 2022 | |
Total Equity | |
Total Equity | 16. Equity attributable to shareholders of Fairfax Authorized capital The authorized share capital of the company consists of an unlimited number of preferred shares issuable in series, an unlimited number of multiple voting shares (cumulatively carrying 41.8% voting power) and an unlimited number of subordinate voting shares carrying one vote per share. Issued capital Issued capital at December 31, 2022 was comprised of 1,548,000 multiple voting shares and 24,598,380 subordinate voting shares without par value prior to deducting 2,021,845 subordinate voting shares reserved in treasury for share-based payment awards (December 31, 2021 – 1,548,000, 24,986,170 and 1,869,340 respectively). The multiple voting shares are not traded. Common stock The number of shares outstanding was as follows: 2022 2021 Subordinate voting shares – January 1 23,116,830 25,427,736 Purchases for cancellation (387,790) (2,137,923) Treasury shares acquired (295,474) (293,197) Treasury shares reissued 142,969 120,214 Subordinate voting shares – December 31 22,576,535 23,116,830 Multiple voting shares – beginning and end of year 1,548,000 1,548,000 Interest in multiple and subordinate voting shares held through ownership interest in shareholder – beginning and end of year (799,230) (799,230) Common stock effectively outstanding – December 31 23,325,305 23,865,600 During 2022 the company purchased for cancellation 387,790 subordinate voting shares (2021 - 137,923) under the terms of its normal course issuer bids at a cost of $199.6 (2021 – $58.1), of which $103.5 (2021 – $23.9) was charged to retained earnings. During 2022 the company purchased for treasury 295,474 subordinate voting shares at a cost of $148.2 (2021 - 293,197 subordinate voting shares at a cost of $132.6) on the open market for use in its share-based payment awards. On December 29, 2021 the company completed a substantial issuer bid pursuant to which it purchased for cancellation 2,000,000 subordinate voting shares at a price of $500.00 per share, for aggregate cash consideration of $1.0 billion, of which $504.6 was charged to retained earnings representing the excess value paid over the company’s paid-up capital of $495.4 that was recorded in common shares, purchases for cancellation, in the consolidated statement of changes in equity. Dividends paid by the company on its outstanding multiple voting and subordinate voting shares were as follows: Date of declaration Date of record Date of payment Dividend per share Total cash payment January 4, 2023 January 19, 2023 January 26, 2023 $ 10.00 $ 245.2 January 5, 2022 January 20, 2022 January 27, 2022 $ 10.00 $ 249.9 January 5, 2021 January 21, 2021 January 28, 2021 $ 10.00 $ 272.1 Preferred stock The terms of the company’s cumulative five-year rate reset preferred shares at December 31, 2022 were as follows: Next possible redemption and Number of Liquidation Fixed dividend Floating conversion shares Carrying preference per rate per dividend rate date (1)(2) outstanding (3) value (3) Stated capital (3) share annum per annum (4) Series C December 31, 2024 7,515,642 $ 170.8 Cdn $ 187.9 Cdn $ 25.00 4.71 % — Series D December 31, 2024 2,484,358 $ 56.4 Cdn $ 62.1 Cdn $ 25.00 — 7.28 % Series E March 31, 2025 5,440,132 $ 124.5 Cdn $ 136.0 Cdn $ 25.00 3.18 % — Series F March 31, 2025 2,099,046 $ 48.1 Cdn $ 52.5 Cdn $ 25.00 — 6.29 % Series G September 30, 2025 7,719,843 $ 182.1 Cdn $ 193.0 Cdn $ 25.00 2.96 % — Series H September 30, 2025 2,280,157 $ 53.8 Cdn $ 57.0 Cdn $ 25.00 — 6.69 % Series I December 31, 2025 10,420,101 $ 250.5 Cdn $ 260.5 Cdn $ 25.00 3.33 % — Series J December 31, 2025 1,579,899 $ 38.0 Cdn $ 39.5 Cdn $ 25.00 — 6.98 % Series K March 31, 2027 9,500,000 $ 231.7 Cdn $ 237.5 Cdn $ 25.00 4.67 % — Series M March 31, 2025 9,200,000 $ 179.6 Cdn $ 230.0 Cdn $ 25.00 5.00 % — $ 1,335.5 Cdn $ 1,456.0 (1) Fixed and floating rate cumulative preferred shares are redeemable by the company at each stated redemption date and on each subsequent five-year anniversary date at Cdn$ 25.00 per share. (2) Holders of Series C, Series E, Series G, Series I, Series K and Series M fixed rate cumulative preferred shares will have the option to convert their shares into Series D, Series F, Series H, Series J, Series L and Series N floating rate cumulative preferred shares respectively, at the specified conversion dates, and on each subsequent five-year anniversary date. Holders of Series D, Series F, Series H and Series J floating rate cumulative preferred shares will have the option to convert their shares into Series C, Series E, Series G and Series I fixed rate cumulative preferred shares respectively, at the specified conversion dates, and on each subsequent five-year anniversary date. (3) For each series of preferred shares, the number of shares outstanding, carrying value and stated capital remained unchanged during 2022 and 2021. (4) The Series D, Series F, Series H, and Series J preferred shares, and the Series L and Series N preferred shares (of which none are currently issued), have a floating dividend rate equal to the three-month Government of Canada treasury bill yield plus 3.15% , 2.16% , 2.56% , 2.85% , 3.51% and 3.98% respectively, with rate resets at the end of each calendar quarter. During 2022 the company paid preferred share dividends of $45.2 (2021 - $44.5). Accumulated other comprehensive income (loss) Accumulated other comprehensive income (loss) attributable to shareholders of Fairfax was comprised as follows: December 31, 2022 December 31, 2021 Income tax After-tax Pre-tax Income tax After-tax Pre-tax amount (expense) recovery amount amount recovery amount Items that may be subsequently reclassified to net earnings Foreign currency translation losses (904.7) 34.4 (870.3) (636.2) 24.6 (611.6) Share of accumulated other comprehensive loss of associates, excluding net gains (losses) on defined benefit plans (221.6) 17.6 (204.0) (79.8) 0.4 (79.4) (1,126.3) 52.0 (1,074.3) (716.0) 25.0 (691.0) Items that will not be subsequently reclassified to net earnings Net gains (losses) on defined benefit plans 43.8 (4.3) 39.5 (104.9) 27.5 (77.4) Share of net gains (losses) on defined benefit plans of associates 10.7 (4.7) 6.0 (57.3) 5.5 (51.8) Other 43.5 5.7 49.2 8.4 10.1 18.5 98.0 (3.3) 94.7 (153.8) 43.1 (110.7) Accumulated other comprehensive income (loss) attributable to shareholders of Fairfax (1,028.3) 48.7 (979.6) (869.8) 68.1 (801.7) Income tax (expense) recovery included in other comprehensive income (loss) Other comprehensive income (loss) in the consolidated statement of comprehensive income is presented net of the following income tax (expense) recovery amounts: 2022 2021 Income tax on items that may be subsequently reclassified to net earnings Net unrealized foreign currency translation losses on foreign subsidiaries 10.0 5.2 Share of other comprehensive loss of associates, excluding net gains on defined benefit plans 18.1 12.7 28.1 17.9 Income tax on items that will not be subsequently reclassified to net earnings Net gains on defined benefit plans (32.2) (27.4) Share of net gains on defined benefit plans of associates (10.2) (12.8) (42.4) (40.2) Total income tax expense included in other comprehensive income (loss) (14.3) (22.3) Non-controlling interests Details of non-controlling interests as at and for the years ended December 31 were as follows: Net earnings (loss) attributable to non- December 31, 2022 December 31, 2021 controlling interests Domicile Voting Carrying Voting Carrying percentage (7) value percentage (7) value 2022 2021 Insurance and reinsurance companies (1) Allied World (2) Bermuda 17.1 % 761.1 29.1 % 1,419.6 (5.6) 117.8 Brit (3) United Kingdom 13.8 % 658.8 13.8 % 559.3 (23.2) 14.0 Odyssey Group (4) United States 9.99 % 499.2 9.99 % 550.0 19.6 — All other (5) — — 50.1 — 402.5 12.0 89.4 1,969.2 2,931.4 2.8 221.2 Non-insurance companies Restaurants and retail (6)(7) — — 208.1 — 494.3 32.7 11.8 Fairfax India (7)(8) Canada 5.6 % 1,080.2 6.1 % 1,133.1 114.2 72.7 Thomas Cook India India 26.7 % 61.3 33.2 % 56.3 1.1 (16.8) Other — — 340.8 — 315.1 (11.2) (23.4) 1,690.4 1,998.8 136.8 44.3 3,659.6 4,930.2 139.6 265.5 (1) Includes property and casualty insurance and reinsurance companies, Life insurance and Run-off, and Corporate and other. (2) On September 27, 2022 the company increased its ownership interest in Allied World to 82.9% from 70.9% for total consideration of $733.5 , inclusive of the fair value of a call option exercised and an accrued dividend paid, and recorded a loss in retained earnings of $228.1 in net changes in capitalization in the consolidated statement of changes in equity. The decrease in carrying value of Allied World’s non-controlling interests primarily reflected the company’s increased ownership interest in Allied World, dividends paid and the non-controlling interests’ share of Allied World’s net loss. On April 28, 2022 Allied World paid a dividend of $126.4 (April 28, 2021 - $126.4 ) to its minority shareholders. The company has the option to purchase the remaining interests of the minority shareholders in Allied World at certain dates until September 2024. (3) The increase in carrying value of Brit’s non-controlling interests during 2022 primarily related to a third party investment of $152.0 in Brit’s subsidiary Ki Insurance, partially offset by dividends paid to minority shareholders and non-controlling interests’ share of Brit’s net loss. The company has the option to purchase the interests of the minority shareholders in Brit at certain dates commencing in October 2023. (4) The decrease in carrying value of Odyssey Group’s non-controlling interests during 2022 primarily related to dividends paid to minority shareholders, partially offset by non-controlling interests’ share of Odyssey Group’s net earnings. The company has the option to purchase the interests of the minority shareholders in Odyssey Group at certain dates commencing in January 2025. (5) The decrease in carrying value of All Other non-controlling interests primarily reflected the company’s purchase of certain securities held through the company’s investment in AVLNs entered with RiverStone Barbados as described in note 7. The remaining carrying value at December 31, 2022 principally related to Fairfax Asia. (6) The decrease in carrying value of Restaurants and retail’s non-controlling interests in 2022 principally related to the privatization of Recipe as described in note 23. (7) At December 31, 2022 Fairfax India’s non-controlling interest economic ownership percentage was 65.3% (December 31, 2021 - 69.9 )% which differed from its non-controlling interest voting percentage of 5.6% (December 31, 2021 - 6.1 )%. On February 15, 2022 the company had acquired an additional 5,416,000 subordinate voting shares of Fairfax India from non-controlling interests, which was recorded in net changes in capitalization in the consolidated statement of changes in equity. At December 31, 2021 Recipe’s non-controlling interest economic ownership percentage was 61.5% which differed from its non-controlling interest voting percentage of 39.0% . (8) The decrease in carrying value of Fairfax India’s non-controlling interests during 2022 primarily reflected the non-controlling interests’ share of Fairfax India’s net unrealized foreign currency translation losses (weakening of the Indian rupee relative to the U.S. dollar), share repurchases by Fairfax India, and the acquisition by the company of additional subordinate voting shares of Fairfax India from non-controlling interests as described above in footnote (7), partially offset by non-controlling interests’ share of Fairfax India’s net earnings. Net changes in capitalization The impact on retained earnings and non-controlling interests of certain capital transactions and changes in ownership interests of the company’s consolidated subsidiaries for the years ended December 31, 2022 and 2021 are included in net changes in capitalization in the consolidated statement of changes in equity as shown in the table below. See note 23 and under the heading “Non-controlling interests” earlier in this note for details of those transactions. 2022 2021 Common Non- Common Non- shareholders’ controlling shareholders’ controlling equity interests equity interests Privatization of Recipe (66.1) (276.2) — — Acquisition of non-controlling interests in Allied World (228.1) (466.9) — — Purchase of certain securities held through AVLNs entered with RiverStone Barbados (note 7) 14.1 (356.2) 0.3 (113.6) Third party’s investment in Brit’s subsidiary Ki Insurance — 152.0 — 124.0 Fairfax India share repurchases (9.9) (90.7) (12.5) (114.3) Sale of non-controlling interests in Odyssey Group — — 429.1 550.0 Sale of non-controlling interests in Brit — — 115.4 296.7 Initial public offerings and related capital transactions at Farmers Edge and Boat Rocker — — (3.1) 242.6 Fairfax India’s sale of an equity interest in Anchorage (note 6) — — 21.8 107.4 Other 116.4 (32.9) 1.9 134.1 As presented in net changes in capitalization in the consolidated statement of changes in equity (173.6) (1,070.9) 552.9 1,226.9 |
Earnings per Share
Earnings per Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings per Share | |
Earnings per Share | 17. Net earnings per share is calculated using the weighted average common shares outstanding as follows: 2022 2021 Net earnings attributable to shareholders of Fairfax 1,147.2 3,401.1 Preferred share dividends (45.2) (44.5) Net earnings attributable to common shareholders – basic and diluted 1,102.0 3,356.6 Weighted average common shares outstanding – basic 23,637,824 25,953,114 Share-based payment awards 1,702,599 1,503,931 Weighted average common shares outstanding – diluted 25,340,423 27,457,045 Net earnings per common share – basic $ 46.62 $ 129.33 Net earnings per common share – diluted $ 43.49 $ 122.25 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes | |
Income Taxes | 18. The company’s provision for income taxes for the years ended December 31 were comprised as follows: 2022 2021 Current income tax: Current year expense 616.8 401.6 Adjustments to prior years’ income taxes (10.0) (14.6) 606.8 387.0 Deferred income tax: Origination and reversal of temporary differences (197.1) 313.5 Adjustments to prior years’ deferred income taxes 11.7 18.9 Other 3.8 6.6 (181.6) 339.0 Provision for income taxes 425.2 726.0 A significant portion of the company’s earnings (loss) before income taxes may be earned or incurred outside of Canada. The statutory income tax rates for jurisdictions outside of Canada generally differ from the Canadian statutory income tax rate, and may be significantly higher or lower. The company’s earnings (loss) before income taxes by jurisdiction and the associated provision for (recovery of) income taxes for the years ended December 31 are summarized in the following table: 2022 2021 Canada (1) U.S. (2) U.K. (3) Other (4) Total Canada (1) U.S. (2) U.K. (3) Other (4) Total Earnings (loss) before income taxes 399.2 1,330.7 (112.2) 94.3 1,712.0 858.8 974.5 157.3 2,402.0 4,392.6 Provision for (recovery of) income taxes 114.7 238.3 (12.9) 85.1 425.2 191.6 238.6 18.7 277.1 726.0 Net earnings (loss) 284.5 1,092.4 (99.3) 9.2 1,286.8 667.2 735.9 138.6 2,124.9 3,666.6 (1) Includes Fairfax India. (2) Principally comprised of Crum & Forster, Zenith National, Odyssey Group (notwithstanding that certain operations of Odyssey Group conduct business outside of the U.S.), U.S. Run-off and other associated holding company results. (3) Comprised of Brit. (4) Primarily includes companies in India, Asia and Europe (excluding the U.K.), and Allied World, which has operations in multiple jurisdictions. Decreased pre-tax profitability across all jurisdictions, except the U.S., in 2022 compared to 2021 primarily related to net unrealized investment losses in 2022, principally on the fixed income portfolio, partially offset by improved underwriting performance, interest and dividends and share of profit of associates. In 2022, pre-tax profitability in the U.S. included a gain on sale and consolidation of insurance subsidiaries of $1,213.2 recorded on the company’s sale of its interests in the Crum & Forster Pet Insurance Group and Pethealth as described in note 23. In 2021, pre-tax profitability in Other included a net unrealized gain of $1,490.3 recorded in Asia on the company’s investment in Digit compulsory convertible preferred shares as described in note 5. Reconciliations of the provision for income taxes calculated at the Canadian statutory income tax rate to the provision for income taxes at the effective tax rate in the consolidated financial statements for the years ended December 31 are summarized in the following table: 2022 2021 Canadian statutory income tax rate 26.5 % 26.5 % Provision for income taxes at the Canadian statutory income tax rate 453.7 1,164.0 Non-taxable investment income (25.6) (149.4) Tax rate differential on income and losses outside Canada (50.9) (399.1) Change in unrecorded tax benefit of losses and temporary differences 0.8 67.2 Change in tax rate for deferred income taxes 6.6 0.3 Provision relating to prior years 1.7 4.3 Foreign exchange effect (17.1) (23.0) Other including permanent differences 56.0 61.7 Provision for income taxes 425.2 726.0 Non-taxable investment income of $25.6 in 2022 and $149.4 in 2021 were principally comprised of dividend income, non-taxable interest income and long term capital gains, and the 50% of net capital gains and losses which are not taxable or deductible in Canada. Non-taxable investment income in 2021 also included gains on the consolidation of Eurolife and the deconsolidation of Privi. The tax rate differential on income and losses outside Canada of $50.9 in 2022 principally related to income taxed at lower rates in the U.S., Mauritius and Barbados, partially offset by losses tax effected at lower rates in Bermuda and Asia. The tax rate differential on income and losses outside Canada of $399.1 in 2021 principally related to income taxed at lower rates in Asia (principally related to the unrealized gain recorded on the company’s investment in Digit compulsory convertible preferred shares), the U.S. and at Allied World. Income taxes refundable and payable were as follows: December 31, December 31, 2022 2021 Income taxes refundable 67.1 58.3 Income taxes payable (361.0) (175.0) Net income taxes payable (293.9) (116.7) Changes in net income taxes (payable) refundable during the years ended December 31 were as follows: 2022 2021 Balance - January 1 (116.7) 24.2 Amounts recorded in the consolidated statements of earnings (606.8) (387.0) Payments made during the year 416.4 288.7 Acquisitions of subsidiaries (note 23) — (54.5) Foreign exchange effect and other 13.2 11.9 Balance - December 31 (293.9) (116.7) Changes in the net deferred income tax asset (liability) during the years ended December 31 were as follows: 2022 Provision Operating for losses Provision Deferred and and loss for premium capital adjustment unearned acquisition Intangible Tax losses expenses premiums costs assets Investments credits Other Total Balance - January 1 230.0 204.2 187.7 (147.8) (413.1) (414.5) 213.6 63.5 (76.4) Amounts recorded in the consolidated statement of earnings (7.1) 53.4 27.0 (22.7) 30.9 219.4 (137.1) 17.8 181.6 Amounts recorded in total equity 8.0 — — — — 20.1 — (42.4) (14.3) Acquisitions of subsidiaries (note 23) 3.3 — — — (1.9) (11.4) — (52.6) (62.6) Deconsolidation of non-insurance subsidiaries (note 23) (0.6) — — — 7.0 — — — 6.4 Foreign exchange effect and other (6.8) (2.9) 0.2 (0.8) 1.0 15.5 (1.1) (44.4) (39.3) Balance - December 31 226.8 254.7 214.9 (171.3) (376.1) (170.9) 75.4 (58.1) (4.6) 2021 Provision Operating for losses Provision Deferred and and loss for premium capital adjustment unearned acquisition Intangible Tax losses expenses premiums costs assets Investments credits Other Total Balance - January 1 236.3 168.8 141.7 (116.1) (389.5) 23.9 174.8 117.6 357.5 Amounts recorded in the consolidated statement of earnings (3.5) 35.6 46.0 (39.4) (19.5) (339.2) 32.3 (51.3) (339.0) Amounts recorded in total equity 17.5 — — — — 0.8 — (37.5) (19.2) Acquisitions of subsidiaries (note 23) (4.2) — — 7.9 (10.3) (98.9) — 31.4 (74.1) Deconsolidation of non-insurance subsidiaries (note 23) (7.5) — — — 7.8 — — 2.3 2.6 Foreign exchange effect and other (8.6) (0.2) — (0.2) (1.6) (1.1) 6.5 1.0 (4.2) Balance - December 31 230.0 204.2 187.7 (147.8) (413.1) (414.5) 213.6 63.5 (76.4) Management expects that recognized deferred income tax assets will be realized in the normal course of operations. The most significant temporary differences included in the net deferred income tax liability at December 31, 2022 related to intangible assets, deferred premium acquisition costs and investments (primarily related to net unrealized investment gains in Asia), partially offset by deferred income tax assets related to operating and capital losses, provision for losses and loss adjustment expenses, provision for unearned premiums and tax credits. In these consolidated financial statements, investment gains and losses are primarily recognized on a mark-to-market basis but are typically only recognized for income tax purposes when realized (particularly in the U.S. and several other jurisdictions). The provision for losses and loss adjustment expenses is recorded on an undiscounted basis in these consolidated financial statements but is recorded on a discounted basis in certain jurisdictions for income tax, resulting in temporary differences. Deferred income tax liabilities on intangible assets primarily relate to intangible assets recognized on acquisitions (principally Brit, Allied World and Recipe) that are typically not deductible in the determination of income taxes payable. The deferred income tax asset related to operating and capital losses arises primarily at Brit, Northbridge, and AGT. Tax credits are primarily in the U.S. and relate to foreign taxes paid that will reduce U.S. taxes payable in the future. Other deferred income tax liabilities include temporary differences related to pensions and premises and equipment. Management conducts ongoing reviews of the recoverability of the deferred income tax asset and adjusts, as necessary, to reflect its anticipated realization. At December 31, 2022 deferred income tax assets of $827.7 (December 31, 2021 - $875.9), which relate principally to operating and capital losses, have not been recorded. The losses for which deferred income tax assets have not been recorded are comprised of losses in Canada of $1,728.0 (December 31, 2021 - $2,089.3), losses in Europe of $552.1 (December 31, 2021 - $488.8), losses in the U.S. of $207.6 (December 31, 2021 - $109.4), and losses at Allied World of $295.6 across various jurisdictions (December 31, 2021 - $251.4). The losses in Canada expire between 2029 and 2042. The losses and foreign tax credits in the U.S. primarily expire between 2024 and 2042. Substantially all of the losses in Europe do not have an expiry date. Allied World’s losses are primarily in the U.K. and Asia, with no expiry date, and in Switzerland which expire within seven years. Deferred income tax has not been recognized for the withholding tax and other taxes that could be payable on the unremitted earnings of certain subsidiaries, which at December 31, 2022 amounted to approximately $9.9 billion (December 31, 2021 - approximately $7.6 billion) and are not likely to be repatriated in the foreseeable future. |
Statutory Requirements
Statutory Requirements | 12 Months Ended |
Dec. 31, 2022 | |
Statutory Requirements | |
Statutory Requirements | 19. The retained earnings of the company are largely represented by retained earnings at the company’s insurance and reinsurance subsidiaries. Those subsidiaries are subject to certain requirements and restrictions under their respective insurance company Acts including minimum capital requirements and dividend restrictions. The company’s capital requirements and management thereof are discussed in note 24. The company’s share of dividends paid in 2022 by the insurance and reinsurance subsidiaries, which are eliminated on consolidation, was $380.9 (2021 - $429.5). Crum & Forster also paid a special dividend of $940.0 to the company in 2022 as a result of the sale of its Pet Insurance Group and Pethealth as described in note 23. Based on the surplus and net earnings (loss) of the primary insurance and reinsurance subsidiaries as at and for the year ended December 31, 2022, the maximum dividend capacity available in 2023 at each of those subsidiaries, payable to all shareholders (including non-controlling interests) is as follows: December 31, 2022 Allied World 1,167.5 Odyssey Group 767.2 Northbridge (1) 422.2 Crum & Forster 204.6 Zenith National 91.4 2,652.9 (1) Subject to prior regulatory approval. When determining the amount of dividends to be paid from its insurance and reinsurance subsidiaries, the company considers regulatory capital requirements, and also rating agency capital tests, future capital levels required to support growth and tax planning matters, among other factors. In addition, the non-controlling interests in Allied World, Odyssey Group and Brit have a dividend in priority to the company. |
Contingencies and Commitments
Contingencies and Commitments | 12 Months Ended |
Dec. 31, 2022 | |
Contingencies and Commitments | |
Contingencies and Commitments | 20. The company and its subsidiaries, in the ordinary course of their business, are or may be anticipated to be defendants, or named as third parties, in damage suits. The uninsured exposure to the company is not considered to be material to the company’s financial position, financial performance or cash flows. Odyssey Group, Brit and Allied World (“the Lloyd’s participants”) underwrite in the Lloyd’s of London insurance market through their participation in certain Lloyd’s syndicates. The Lloyd’s participants have pledged cash and cash equivalents of $233.6 and securities with a fair value of $1,670.7 at December 31, 2022 as capital to support those underwriting activities. Pledged securities primarily consist of short term investments, bonds and equity investments presented within portfolio investments on the consolidated balance sheet. The Lloyd’s participants have the ability to substitute other securities for these pledged securities, subject to certain admissibility criteria. The Lloyd’s participants’ liability in respect of assets pledged as capital is limited to the aggregate amount of the pledged assets and their obligation to support these liabilities will continue until such liabilities are settled or are reinsured by a third party approved by Lloyd’s. The company believes that the syndicates for which the Lloyd’s participants are capital providers maintain sufficient liquidity and financial resources to support their ultimate liabilities and does not anticipate that the pledged assets will be utilized. The company’s maximum capital commitments for potential investments in common stocks, limited partnerships, associates and joint ventures at December 31, 2022 was $1,422.8. Additionally, pursuant to the sale of RiverStone Barbados as described in note 23, the company has guaranteed the remaining value of $486.8 at December 31, 2022 of certain securities that remain held by CVC and certain affiliates thereof until such time that the securities are purchased by or sold at the direction of Hamblin Watsa, prior to the end of 2023. |
Pensions and Post Retirement Be
Pensions and Post Retirement Benefits | 12 Months Ended |
Dec. 31, 2022 | |
Pensions and Post Retirement Benefits | |
Pensions and Post Retirement Benefits | 21. The funded status of the company’s defined benefit pension and post retirement plans at December 31 were as follows: Defined benefit Defined benefit pension plans post retirement plans 2022 2021 2022 2021 Benefit obligation (715.5) (1,070.9) (66.8) (83.9) Fair value of plan assets 784.7 1,014.7 — — Funded status of plans - surplus (deficit) 69.2 (56.2) (66.8) (83.9) Impact of asset ceiling (3.6) — — — Net accrued asset (liability) (1) 65.6 (56.2) (66.8) (83.9) Weighted average assumptions used to determine benefit obligations: Discount rate 4.9 % 2.6 % 5.2 % 3.1 % Rate of compensation increase 2.5 % 2.2 % 3.8 % 3.7 % Health care cost trend — — 3.4 % 3.6 % (1) The defined benefit pension plan net accrued asset at December 31, 2022 of $65.6 (December 31, 2021 - net accrued liability of $56.2 ) was comprised of pension surpluses of $144.5 , partially offset by pension deficits of $78.9 (December 31, 2021 - pension deficits of $170.0 , partially offset by pension surpluses of $113.8 ). See notes 13 and 14. Pension and post retirement benefit expenses recognized in the consolidated statement of earnings for the years ended December 31 were as follows: 2022 2021 Defined benefit pension plan expense 20.3 25.8 Defined contribution pension plan expense 62.2 57.8 Defined benefit post retirement plan expense 5.0 2.0 87.5 85.6 Pre-tax actuarial net gains (losses) recognized in the consolidated statement of comprehensive income for the years ended December 31 were comprised as follows: 2022 2021 Defined benefit pension plans Actuarial net gains (losses) on plan assets and change in asset ceiling (157.3) 78.6 Actuarial net gains on benefit obligations 295.0 33.8 137.7 112.4 Defined benefit post retirement plans - actuarial net gains on benefit obligations 16.2 3.2 153.9 115.6 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Leases | 22. Changes in the company’s right-of-use assets for the year ended December 31 were as follows: 2022 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total Balance - January 1 328.8 431.0 759.8 396.1 611.9 1,008.0 Additions 63.7 98.2 161.9 44.0 92.0 136.0 Disposals (7.5) (8.4) (15.9) (41.2) (19.8) (61.0) Depreciation (2) (67.2) (89.9) (157.1) (68.3) (113.0) (181.3) Acquisitions of subsidiaries (note 23) — 56.7 56.7 0.9 14.1 15.0 Deconsolidation of subsidiaries (note 23) (1.1) (2.9) (4.0) (1.4) (146.7) (148.1) Foreign exchange effect and other (9.5) (23.4) (32.9) (1.3) (7.5) (8.8) Balance - December 31 (note 13) 307.2 461.3 768.5 328.8 431.0 759.8 (1) Includes Life insurance and Run-off and Corporate and Other. (2) Recorded in operating expenses and other expenses in the consolidated statement of earnings. The maturity profile of the company’s lease liabilities was as follows: December 31, 2022 December 31, 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total One year or less 72.7 155.8 228.5 77.4 173.6 251.0 One to two years 66.5 142.4 208.9 67.6 148.1 215.7 Two to three years 60.3 127.7 188.0 58.6 129.8 188.4 Three to four years 55.9 108.0 163.9 52.0 115.4 167.4 Four to five years 45.5 86.5 132.0 45.1 96.3 141.4 More than five years 117.7 330.2 447.9 142.8 249.6 392.4 Lease liabilities, undiscounted 418.6 950.6 1,369.2 443.5 912.8 1,356.3 Lease liabilities, discounted 364.1 729.9 1,094.0 384.2 756.5 1,140.7 Weighted average incremental borrowing rate 3.8 % 4.7 % 4.4 % 3.8 % 4.5 % 4.3 % (1) Includes Life insurance and Run-off and Corporate and Other. During 2022 the company recognized in the consolidated statement of earnings interest expense on lease liabilities of $46.9 (2021 - $57.9) (note 15), and short-term, low value and other lease costs of $51.0 (2021 - $19.1) that included the benefit of COVID-19 lease concessions and government rent subsidies of $1.7 (2021 - $28.9) primarily recorded in the Non-insurance companies reporting segment (note 26). The maturity profile of the company’s finance lease receivables was as follows: December 31, 2022 December 31, 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total One year or less 2.8 55.4 58.2 2.5 62.0 64.5 One to two years 1.8 48.5 50.3 2.3 53.0 55.3 Two to three years 1.4 42.7 44.1 1.3 44.7 46.0 Three to four years 1.1 36.7 37.8 1.0 39.3 40.3 Four to five years 0.7 27.8 28.5 1.0 33.3 34.3 More than five years 2.0 43.9 45.9 2.8 64.5 67.3 Finance lease receivables, undiscounted 9.8 255.0 264.8 10.9 296.8 307.7 Unearned finance income 1.0 37.0 38.0 1.5 40.1 41.6 Finance lease receivables (note 13) 8.8 218.0 226.8 9.4 256.7 266.1 (1) Includes Life insurance and Run-off and Corporate and Other . |
Acquisitions and Divestitures
Acquisitions and Divestitures | 12 Months Ended |
Dec. 31, 2022 | |
Acquisitions and Divestitures | |
Acquisitions and Divestitures | 23. Subsequent to December 31, 2022 Sale of Ambridge Group by Brit On January 7, 2023 Brit entered into an agreement to sell Ambridge Group, its Managing General Underwriter operations, to Amynta Group. The company will receive approximately $400 on closing, comprised principally of cash of $275.0 and a promissory note of approximately $125. An additional $100.0 may be receivable based on 2023 performance targets of Ambridge. Closing of the transaction is subject to customary closing conditions, including regulatory approvals, and is expected to occur in the next few months. On closing of the transaction, the company expects to deconsolidate assets and liabilities with carrying values at December 31, 2022 of approximately $284 and $160, and to record a pre-tax gain of approximately $275 (prior to ascribing any fair value to the additional receivable). Year ended December 31, 2022 Sale of Pet Insurance Operations and Investment in JAB Consumer Fund On October 31, 2022 the company sold its interests in the Crum & Forster Pet Insurance Group and Pethealth, including all of their worldwide operations, to Independence Pet Group and certain of its affiliates, which are majority owned by JAB Holding Company (“JAB”), for $1.4 billion, paid as $1.15 billion in cash and $250.0 in debentures. The company also committed to invest $200.0 in JCP V, a JAB consumer fund. As a result of the sale, the company recorded a pre-tax gain of $1,213.2, inclusive of foreign currency translation losses that were reclassified from accumulated other comprehensive income (loss) to the consolidated statement of earnings, and selling expenses, in gain on sale and consolidation of insurance subsidiaries in the consolidated statement of earnings (an after-tax gain of $933.9), and deconsolidated assets and liabilities with carrying values of $149.1 and $32.0. Additional investment in Recipe Unlimited Corporation On October 28, 2022 the company acquired all of the multiple voting shares (“MVS”) and subordinate voting shares in the capital of Recipe, other than those shares owned by the company and 9,398,729 MVS owned by Cara Holdings Limited, at a cash purchase price of Cdn$20.73 per share or $342.3 (Cdn$465.9) in aggregate, comprised of cash consideration of $242.5 (Cdn$330.0) and an increase in borrowings by Recipe of $99.8 (Cdn$135.9). The company recorded a loss in retained earnings of $66.1 and a decrease in non-controlling interests of $276.2, both of which are presented in net changes in capitalization in the consolidated statement of changes in equity. The transaction increased the company’s equity ownership in Recipe from 38.5% at December 31, 2021 to 75.7%, or 84.0% inclusive of Recipe shares held through the company’s investment in AVLNs entered with RiverStone Barbados. Recipe was subsequently delisted from the Toronto Stock Exchange. On December 28, 2022 the company received $73.6 (Cdn$100.0) cash consideration from Recipe upon redemption of certain equity held by the company in connection with the closing of the transaction. Consolidation of Grivalia Hospitality S.A. On July 5, 2022 the company increased its interest in Grivalia Hospitality S.A. (“Grivalia Hospitality”) to 78.4% from 33.5% by acquiring additional shares for cash consideration of $194.6 (€190.0) and commenced consolidating the assets, liabilities and results of operations of Grivalia Hospitality in the Non-insurance companies reporting segment. Grivalia Hospitality acquires, develops and manages hospitality real estate in Greece, Cyprus and Panama. Year ended December 31, 2021 Sale of non-controlling interest in Odyssey Group On December 15, 2021 Odyssey Group issued shares representing an aggregate 9.99% equity interest to a subsidiary of Canada Pension Plan Investment Board (“CPPIB”) and OMERS, the pension plan for Ontario’s municipal employees, for cash consideration of $900.0 which was subsequently paid by Odyssey Group as a dividend to Fairfax. The company recorded an aggregate equity gain of $429.1, principally comprised of a dilution gain and the fair value of a call option received, which was presented as net changes in capitalization in the consolidated statement of changes in equity. The company has the option to purchase the interests of CPPIB and OMERS in Odyssey Group at certain dates commencing in January 2025. Sale of non-controlling interest in Brit On August 27, 2021 Brit issued shares representing a 13.9% equity interest to OMERS for cash consideration of $375.0 which was subsequently paid by Brit as a dividend to Fairfax. The company recorded an aggregate equity gain of $115.4, principally comprised of a dilution gain and the fair value of a call option received, which was presented as net changes in capitalization in the consolidated statement of changes in equity. The company has the option to purchase OMERS’ interest in Brit at certain dates commencing in October 2023. Sale of RiverStone Barbados On August 23, 2021 the company sold its 60.0% joint venture interest in RiverStone (Barbados) Ltd. (“RiverStone Barbados”) to CVC Capital Partners (“CVC”). OMERS also sold its 40.0% joint venture interest in RiverStone Barbados to CVC as part of the transaction. The company received consideration of $695.7, principally comprised of cash of $462.0, non-voting shares of CVC’s RiverStone Barbados holding company with a fair value of $200.0 (which will convert into a secured vendor loan note with a principal amount of $200.0 upon completion of certain regulatory undertakings by CVC) and a pension asset on assumption of RiverStone Barbados’ closed pension plan, and recorded a net loss of $2.1 in net gains (losses) on investments in the consolidated statement of earnings, inclusive of foreign currency translation gains that were reclassified from accumulated other comprehensive income (loss) to the consolidated statement of earnings. The company also received a contingent value instrument for potential future proceeds of up to $235.7 with a nominal fair value. Prior to completion of the transaction, certain subsidiaries of RiverStone Barbados held investments in various Fairfax subsidiaries and certain other companies. Accordingly, CVC and certain affiliates thereof became the indirect owner of those securities upon completion of the transaction. As part of the transaction, on February 8, 2021 the company had entered into Asset Value Loan Notes (“AVLNs”) to guarantee the then approximately $1.3 billion value of the securities to CVC and certain affiliates thereof until such time the securities are purchased by or sold at the direction of Hamblin Watsa, prior to the end of 2022. The company, through Hamblin Watsa, continues to manage and have direction over these securities, including their voting rights. The company recorded the AVLNs as derivative instruments whose fair value is the difference between the guaranteed value of the underlying securities and their fair value, which resulted in a derivative asset of $103.8 on the consolidated balance sheet at December 31, 2021, and a net gain on investments of $103.8 for the year then ended in the consolidated statement of earnings. During 2021 securities with a guaranteed value of $120.8 were sold or purchased by Hamblin Watsa, leaving securities with a guaranteed value of approximately $1.1 billion remaining under the AVLNs at December 31, 2021. Subsequently, as described in note 7, on July 5, 2022 an amendment to the AVLNs was completed, extending $543.4 of the underlying securities to be purchased or sold prior to the end of 2023. The remainder of the securities were purchased or sold during 2022; in addition, part of the amended AVLNs were purchased in the second half of 2022. Sale of Toys “R” Us Canada On August 19, 2021 the company sold the operations of Toys “R” Us Canada for consideration of $90.3 (Cdn$115.7), deconsolidated Toys “R” Us Canada from the Non-insurance companies reporting segment and recorded a net gain of $85.7 in net gains (losses) on investments in the consolidated statement of earnings. The consideration received was comprised principally of a monthly royalty on future revenue of Toys “R” Us Canada. Privatization of Mosaic Capital On August 5, 2021 Mosaic Capital completed a privatization arrangement with a third party purchaser pursuant to which the company exchanged its holdings of Mosaic Capital debentures and warrants, and cash of $10.7 (Cdn$13.3), for $130.8 (Cdn$163.3) of newly issued Mosaic Capital 25-year debentures, and invested $4.0 (Cdn$5.0) in the privatized company for a 20.0% equity interest. The company deconsolidated Mosaic Capital from the Non-insurance companies reporting segment, recorded the Mosaic Capital 25-year debentures at FVTPL and commenced applying the equity method of accounting to its interest in the purchaser. Acquisition of Eurolife FFH Insurance Group Holdings S.A. On July 14, 2021 the company increased its interest in Eurolife FFH Insurance Group Holdings S.A. (“Eurolife”) to 80.0% from 50.0% by exercising a call option valued at $127.3 to acquire the joint venture interest of OMERS for cash consideration of $142.7 (€120.7). The assets, liabilities and results of operations of Eurolife’s life insurance business were consolidated in the Life insurance and Run-off segment and those of Eurolife’s property and casualty insurance business were consolidated in the International Insurers and Reinsurers reporting segment, pursuant to which the company remeasured its 50.0% joint venture interest in Eurolife to its fair value of $450.0 and recorded a net gain of $130.5 in gain on sale and consolidation of insurance subsidiaries in the consolidated statement of earnings, inclusive of foreign currency translation gains that were reclassified from accumulated other comprehensive income (loss) to the consolidated statement of earnings. The remaining 20.0% equity interest in Eurolife continues to be owned by the company’s associate Eurobank. Eurolife is a Greek insurer which distributes its life and property and casualty insurance products and services through Eurobank’s network and other distribution channels. Eurolife Acquisition date July 14, 2021 Percentage of common shares acquired 80.0 % (1) Assets: Insurance contract receivables 11.6 Portfolio investments 3,653.9 (2) Recoverable from reinsurers 18.6 Deferred income tax assets 32.6 Intangible assets 45.5 (3) Other assets 616.3 (4) 4,378.5 Liabilities: Accounts payable and accrued liabilities 273.2 (5) Insurance contract payables 529.0 Insurance contract liabilities 2,751.4 Deferred income tax liabilities 100.9 3,654.5 Purchase consideration 720.0 (6) Excess of fair value of net assets acquired over purchase consideration 4.0 4,378.5 (1) The transaction was recorded as the acquisition of a 100% equity interest in Eurolife with the non-controlling interests represented by a redemption liability (described in footnote 5 below) that was included in the fair value of assets acquired and liabilities assumed. (2) Includes subsidiary cash and cash equivalents of $1,433.3 . (3) Principally an intangible asset of $29.0 related to a distribution agreement with Eurobank. (4) Principally investment assets of $532.1 related to unit-linked life insurance contracts. (5) Includes a redemption liability of $124.9 on non-controlling interests as the company’s associate Eurobank may put its 20.0% equity interest in Eurolife to the company commencing in 2024 at the then fair value of that interest. (6) Comprised of cash consideration of $142.7 , a call option exercised with a fair value of $127.3 and the company’s 50.0% joint venture interest with a fair value of $450.0 . Additional investment in Singapore Reinsurance Corporation Limited On June 17, 2021 the company increased its ownership interest in Singapore Reinsurance Corporation Limited (“Singapore Re”) from 28.2% to 94.0% for $102.9 (SGD 138.0) and subsequently increased its ownership interest to 100%. Singapore Re is a general property and casualty reinsurer that underwrites business primarily in southeast Asia. Fairfax India’s sale of Privi Speciality Chemicals Limited On April 29, 2021 Fairfax India sold its 48.8% equity interest in Privi Speciality Chemicals Limited (“Privi”) to certain affiliates of Privi’s founders for $164.8 (12.2 billion Indian rupees), deconsolidated the assets and liabilities of Privi and recorded a net realized gain on investment of $94.9 in the consolidated statement of earnings. |
Financial Risk Management
Financial Risk Management | 12 Months Ended |
Dec. 31, 2022 | |
Financial Risk Management | |
Financial Risk Management | 24. Overview The primary goals of the company’s financial risk management are to ensure that the outcomes of activities involving elements of risk are consistent with the company’s objectives and risk tolerance, while maintaining an appropriate balance between risk and reward and protecting the company’s consolidated balance sheet from events that have the potential to materially impair its financial strength. The company’s exposure to potential loss from its insurance and reinsurance operations and investment activities primarily relates to underwriting risk, credit risk, liquidity risk and various market risks. Balancing risk and reward is achieved through identifying risk appropriately, aligning risk tolerances with business strategy, diversifying risk, pricing appropriately for risk, mitigating risk through preventive controls and transferring risk to third parties. There were no significant changes in the types of the company’s risk exposures or the processes used by the company for managing those risk exposures at December 31, 2022 compared to those identified at December 31, 2021, except as discussed below. Financial risk management objectives are achieved through a two tiered system, with detailed risk management processes and procedures at the company’s primary operating subsidiaries and its investment management subsidiary combined with the analysis of the company- wide aggregation and accumulation of risks at the holding company. In addition, although the company and its operating subsidiaries each have an officer with designated responsibility for risk management, the company regards each Chief Executive Officer as the chief risk officer of their company; each Chief Executive Officer is the individual ultimately responsible for risk management for his or her company and its subsidiaries. The company’s President and Chief Operating Officer reports on risk considerations to the company’s Executive Committee and provides a quarterly report on key risk exposures to the company’s Board of Directors. The Executive Committee, in consultation with the President and Chief Operating Officer, approves certain policies for overall risk management, as well as policies addressing specific areas such as investments, underwriting, catastrophe risk and reinsurance. The company’s Investment Committee approves policies for the management of market risk (including currency risk, interest rate risk and other price risk) and the use of derivative and non-derivative financial instruments, and monitors to ensure compliance with relevant regulatory guidelines and requirements. A discussion of the company’s risks and the management of those risks is an agenda item for every regularly scheduled meeting of the Board of Directors. Underwriting Risk Property and casualty insurance and reinsurance Underwriting risk is the risk that the total cost of claims, claims adjustment expenses, commissions and premium acquisition costs will exceed premiums received and can arise as a result of numerous factors, including pricing risk, reserving risk and catastrophe risk. There were no significant changes to the company’s exposure to underwriting risk, and there were no changes to the framework used to monitor, evaluate and manage underwriting risk at December 31, 2022 compared to December 31, 2021. Principal lines of business The company’s principal insurance and reinsurance lines of business and the significant insurance risks inherent therein are as follows: ● Property, which insures against losses to property from (among other things) fire, explosion, natural perils (for example, earthquake, windstorm and flood), terrorism and engineering problems (for example, boiler explosion, machinery breakdown and construction defects). Specific types of property risks underwritten by the company include automobile, commercial and personal property and crop; ● Casualty, which insures against accidents (including workers’ compensation and automobile) and also includes employers’ liability, accident and health, medical malpractice, professional liability and umbrella coverage; and ● Specialty, which insures against marine, aerospace and surety risk, and other various risks and liabilities that are not identified above. An analysis of net premiums earned by line of business is included in note 25. The table that follows shows the company’s concentration of insurance risk by region and line of business based on gross premiums written prior to giving effect to ceded reinsurance premiums. The company’s exposure to general insurance risk varies by geographic region and may change over time. Premiums ceded to reinsurers (including retrocessions) in 2022 by line of business was comprised of property of $1,938.5 (2021 - $1,717.4), casualty of $3,256.6 (2021 - $3,487.7) and specialty of $439.2 (2021 - $423.4). Canada United States Asia (1) International (2) Total (3) For the years ended December 31 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 Property 1,343.7 1,229.1 4,966.1 3,912.4 984.5 849.2 2,418.2 2,141.9 9,712.5 8,132.6 Casualty 1,243.4 1,159.0 12,004.9 10,364.0 606.6 549.8 1,823.0 1,659.5 15,677.9 13,732.3 Specialty 258.3 223.3 871.6 755.6 343.2 277.4 698.2 674.8 2,171.3 1,931.1 Total 2,845.4 2,611.4 17,842.6 15,032.0 1,934.3 1,676.4 4,939.4 4,476.2 27,561.7 23,796.0 Insurance 2,686.2 2,475.1 13,080.8 11,448.6 789.8 739.7 3,608.6 3,341.0 20,165.4 18,004.4 Reinsurance 159.2 136.3 4,761.8 3,583.4 1,144.5 936.7 1,330.8 1,135.2 7,396.3 5,791.6 2,845.4 2,611.4 17,842.6 15,032.0 1,934.3 1,676.4 4,939.4 4,476.2 27,561.7 23,796.0 (1) The Asia geographic segment is primarily comprised of countries located throughout Asia, including China, Japan, India, Sri Lanka, Malaysia, Singapore, Indonesia and South Korea, and the Middle East. (2) The International geographic segment is primarily comprised of countries located in South America, Europe, Africa and Oceania. (3) Excludes Eurolife’s life insurance operations’ gross premiums written of $350.9 in 2022 and 114.2 in 2021. Eurolife was consolidated on July 14, 2021. Pricing risk Pricing risk arises because actual claims experience may differ adversely from the assumptions used in pricing insurance risk. Historically, the underwriting results of the property and casualty industry have fluctuated significantly due to the cyclical nature of the insurance market. Market cycles are affected by the frequency and severity of losses, levels of capacity and demand, general economic conditions, including inflationary pressures, and competition on rates and terms of coverage. The operating companies focus on profitable underwriting using a combination of experienced underwriting and actuarial staff, pricing models and price adequacy monitoring tools. Reserving risk Reserving risk arises because actual claims experience may differ adversely from the assumptions used in setting reserves, in large part due to the length of time between the occurrence of a loss, the reporting of the loss to the insurer and the ultimate resolution of the claim. The degree of uncertainty will vary by line of business according to the characteristics of the insured risks, with the ultimate cost of a claim determined by the actual insured loss suffered by the policyholder. Claims provisions reflect expectations of the ultimate cost of resolution and administration of claims based on an assessment of facts and circumstances then known, a review of historical settlement patterns, estimates of trends in claim severity and frequency, developing case law and other factors. The time required to learn of and settle claims is often referred to as the “tail” and is an important consideration in establishing the company’s reserves. Short-tail claims are those for which losses are normally reported soon after the incident and are generally settled within months following the reported incident. This would include, for example, most property, automobile and marine and aerospace damage. Long-tail claims are considered by the company to be those that often take three years or more to develop and settle, such as asbestos, environmental pollution, workers’ compensation, professional liability and product liability. Information concerning the loss event and ultimate cost of a long-tail claim may not be readily available, making the reserving analysis of long-tail lines of business more difficult and subject to greater uncertainties than for short-tail lines of business. In the extreme cases, long-tail claims involving asbestos and environmental pollution, it may take upwards of 40 years to settle. The company employs specialized techniques to determine such provisions using the extensive knowledge of both internal and external asbestos and environmental pollution experts and legal advisors. The establishment of provisions for losses and loss adjustment expenses is an inherently uncertain process that can be affected by internal factors such as: the risk in estimating loss development patterns based on historical data that may not be representative of future loss payment patterns; assumptions built on industry loss ratios or industry benchmark development patterns that may not reflect actual experience; the intrinsic risk as to the homogeneity of the underlying data used in carrying out the reserve analyses; and external factors such as trends relating to jury awards; economic inflation; medical cost inflation; worldwide economic conditions; tort reforms; court interpretations of coverage; the regulatory environment; underlying policy pricing; claims handling procedures; inclusion of exposures not contemplated at the time of policy inception; and significant changes in severity or frequency of losses relative to historical trends. Due to the amount of time between the occurrence of a loss, the actual reporting of the loss and the ultimate settlement of the claim, provisions may ultimately develop differently from the actuarial assumptions made when initially estimating the provision for losses. As a result of continued inflationary pressures felt throughout the economy in 2022 and the resulting changes to global monetary policy, the company has placed a renewed focus on inflationary assumptions used in both the pricing of new business and within the company’s reserving process, specifically when setting initial loss estimates and projecting the ultimate costs to settle claims. The company has experienced inflationary pressures on its costs to settle claims throughout 2022, and both economic and social inflation remain a key consideration in the company’s reserving methodology and form part of its determination in the selection of the company’s ultimate cost to settle claims. The diversity of insurance risk within the company’s portfolio of issued policies makes it difficult to predict whether material prior year reserve development will occur and, if it does occur, the location and the timing of such an occurrence. Catastrophe risk Catastrophe risk arises from exposure to large losses caused by man-made or natural catastrophes that could result in significant underwriting losses. Weather-related catastrophe losses are also affected by climate change which increases the unpredictability of both frequency and severity of such losses. As the company does not establish reserves for catastrophes in advance of the occurrence of such events, these events may cause volatility in the levels of incurred losses and reserves, subject to the effects of reinsurance recoveries. This volatility may also be contingent upon political and legal developments after the occurrence of the event. The company evaluates potential catastrophic events and assesses the probability of occurrence and magnitude of these events predominantly through probable maximum loss (“PML”) modeling techniques and through the aggregation of limits exposed. A wide range of events are simulated using the company’s proprietary and commercial models, including single large events and multiple events spanning the numerous geographic regions in which the company assumes insurance risk. Each operating company has developed and applies strict underwriting guidelines for the amount of catastrophe exposure it may assume as a standalone entity for any one risk and location, and those guidelines are regularly monitored and updated. Operating companies also manage catastrophe exposure by diversifying risk across geographic regions, catastrophe types and other lines of business, factoring in levels of reinsurance protection, adjusting the amount of business written based on capital levels and adhering to risk tolerance guidelines. The company’s head office aggregates catastrophe exposure company-wide and continually monitors the group’s aggregate exposure. Independent exposure limits for each entity in the group are aggregated to produce an exposure limit for the group as there is presently no model capable of simultaneously projecting the magnitude and probability of loss in all geographic regions in which the company operates. Currently the company’s objective is to limit its company-wide catastrophe loss exposure such that one year’s aggregate pre-tax net catastrophe losses would not exceed one year’s normalized net earnings before income taxes. The company takes a long term view and generally considers a 15% return on common shareholders’ equity, adjusted to a pre-tax basis, to be representative of one year’s normalized net earnings. The modeled probability of aggregate catastrophe losses in any one year exceeding this amount is generally more than once in every 250 years. Management of underwriting risk To manage exposure to underwriting risk, and the pricing, reserving and catastrophe risks contained therein, operating companies have established limits for underwriting authority and requirements for specific approvals of transactions involving new products or transactions involving existing products which exceed certain limits of size or complexity. The company’s objective of operating with a prudent and stable underwriting philosophy with sound reserving is also achieved through the establishment of goals, delegation of authorities, financial monitoring, underwriting reviews and remedial actions to facilitate continuous improvement. The company’s provision for claims is reviewed separately by, and must be acceptable to, internal actuaries at each operating company and the company’s Chief Actuary. Additionally, independent actuaries are periodically engaged to review an operating company’s reserves or reserves for certain lines of business. The company purchases reinsurance protection for risks assumed when it is considered prudent and cost effective to do so at the operating companies for specific exposures and, if needed, at the holding company for aggregate exposures. Steps are taken to actively reduce the volume of insurance and reinsurance underwritten on particular types of risks when the company desires to reduce its direct exposure due to inadequate pricing. As part of its overall risk management strategy, the company cedes insurance risk through proportional, non-proportional and facultative reinsurance treaties. With proportional reinsurance, the reinsurer shares a pro rata portion of the company’s losses and premium, whereas with non-proportional reinsurance, the reinsurer assumes payment of the company’s loss above a specified retention, subject to a limit. Facultative reinsurance is the reinsurance of individual risks as agreed by the company and the reinsurer. The company follows a policy of underwriting and reinsuring contracts of insurance and reinsurance which, depending on the type of contract, generally limits the liability of an operating company on any policy to a maximum amount on any one loss. Reinsurance decisions are made by operating companies to reduce and spread the risk of loss on insurance and reinsurance written, to limit multiple claims arising from a single occurrence and to protect capital resources. The amount of reinsurance purchased can vary among operating companies depending on the lines of business written, their respective capital resources and prevailing or expected market conditions. Reinsurance is generally placed on an excess of loss basis and written in several layers, the purpose of which is to limit the amount of one risk to a maximum amount acceptable to the company and to protect from losses on multiple risks arising from a single occurrence. This type of reinsurance includes what is generally referred to as catastrophe reinsurance. The company’s reinsurance does not, however, relieve the company of its primary obligation to the policyholder. The majority of reinsurance contracts purchased by the company provide coverage for a one year term and are negotiated annually. The ability of the company to obtain reinsurance on terms and prices consistent with historical results reflects, among other factors, recent loss experience of the company and of the industry in general. The effects of low interest rates, increased catastrophes, uncertainty surrounding the impact of climate change on the nature of catastrophic losses and rising claims costs are elevating reinsurance pricing, which has affected the company’s reinsurance cost for loss affected business and retroactive reinsurance. Notwithstanding the significant catastrophe losses suffered by the industry since 2017, capital adequacy within the reinsurance market remains strong with new capital entering the market and alternative forms of reinsurance capacity continuing to be available. The company remains opportunistic in its use of reinsurance including alternative forms of reinsurance, balancing capital requirements and the cost of reinsurance. Life Insurance Life insurance risk in the company arises principally through Eurolife’s exposure to actual experience in the areas of mortality, morbidity, longevity, policyholder behaviour and expenses which is adverse to expectations. Exposure to underwriting risk is managed by uniform underwriting procedures that have been established at Eurolife to determine the insurability of applicants and to manage aggregate exposures for adverse deviations in assumptions. These underwriting requirements are regularly reviewed by Eurolife’s actuaries. Credit Risk Credit risk is the risk of loss resulting from the failure of a counterparty to honour its financial obligations to the company. Credit risk arises predominantly on cash and short term investments, investments in debt instruments, insurance contract receivables, recoverable from reinsurers and receivables from counterparties to derivative contracts (primarily foreign currency forward contracts and total return swaps). There were no significant changes to the company’s exposure to credit risk (except as set out in the discussion which follows) or the framework used to monitor, evaluate and manage credit risk at December 31, 2022 compared to December 31, 2021. The company’s gross credit risk exposure (without consideration of amounts held by the company as collateral) was comprised as follows: December 31, December 31, 2022 2021 Cash and short term investments 10,386.0 22,795.5 Investments in debt instruments: U.S. sovereign government (1) 14,378.8 3,957.9 Other sovereign government rated AA/Aa or higher (1)(2) 2,413.5 1,074.7 All other sovereign government (3) 2,210.2 2,194.9 Canadian provincials 284.1 45.0 U.S. states and municipalities 262.7 387.2 Corporate and other (4)(5) 9,451.9 6,873.9 Receivable from counterparties to derivative contracts 256.1 158.9 Insurance contract receivables 7,907.5 6,883.2 Recoverable from reinsurers 13,115.8 12,090.5 Other assets (6) 2,024.6 1,881.3 Total gross credit risk exposure 62,691.2 58,343.0 (1) Represented together 30.3% of the company’s total investment portfolio at December 31, 2022 (December 31, 2021 - 9.5% ) and considered by the company to have nominal credit risk. (2) Comprised primarily of bonds issued by the governments of Canada, the United Kingdom and Singapore with fair values at December 31, 2022 of $1,923.5 , $180.6 and $91.3 respectively (December 31, 2021 - $614.6 , $7.7 and $95.1 ). (3) Comprised primarily of bonds issued by the governments of Brazil, Greece, Spain and Poland with fair values at December 31, 2022 of $744.2 , $690.1 , $216.2 and $126.9 respectively (December 31, 2021 - $415.4 , $844.7 , $297.5 , and $78.5 ). (4) Represents 17.0% of the company’s total investment portfolio at December 31, 2022 compared to 13.0% at December 31, 2021, with the increase principally related to net purchases of short to mid-dated high quality corporate bonds of $ 2,331.9 and net purchases of unrated first mortgage loans of $870.2 . (5) Includes the company’s investments in first mortgage loans at December 31, 2022 of $2,500.7 (December 31, 2021 - $1,659.4 ) secured by real estate predominantly in the U.S., Europe and Canada as described in note 5. (6) Excludes assets associated with unit-linked insurance products of $676.5 at December 31, 2022 (December 31, 2021 – $637.1 ) for which credit risk is not borne by the company, and income taxes refundable of $67.1 at December 31, 2022 (December 31, 2021 - $58.3 ) that are considered to have nominal credit risk. Cash and short term investments The company’s cash and short term investments (including those of the holding company) are primarily held at major financial institutions in the jurisdictions in which the company operates. At December 31, 2022, 69.4% of these balances were held in Canadian and U.S. financial institutions, 24.8% in European financial institutions and 5.8% in other foreign financial institutions (December 31, 2021 - 82.7%, 14.9% and 2.4% respectively). The company monitors risks associated with cash and short term investments by regularly reviewing the financial strength and creditworthiness of these financial institutions and more frequently during periods of economic volatility. From these reviews, the company may transfer balances from financial institutions where it perceives heightened credit risk to others considered to be more stable. Investments in debt instruments The company’s risk management strategy for debt instruments is to invest primarily in those of high credit quality issuers and to limit the amount of credit exposure to any one corporate issuer. Management considers high quality debt instruments to be those with a S&P or Moody’s issuer credit rating of BBB/Baa or higher. While the company reviews third party credit ratings, it also performs its own analysis and does not delegate the credit decision to rating agencies. The company endeavours to limit credit exposure by monitoring fixed income portfolio limits on individual corporate issuers and on credit quality and may, from time to time, initiate positions in certain types of derivatives to further mitigate credit risk exposure. The composition of the company’s investments in debt instruments classified according to the higher of each security’s respective S&P and Moody’s issuer credit rating is presented in the table that follows: December 31, 2022 December 31, 2021 Amortized Fair Amortized Fair Issuer Credit Rating cost value % cost value % AAA/Aaa 17,119.4 16,721.6 57.7 5,248.2 5,237.3 36.1 AA/Aa 858.3 847.6 2.9 435.0 437.7 3.0 A/A 2,409.6 2,330.6 8.0 1,838.4 1,865.5 12.8 BBB/Baa 3,410.3 3,348.7 11.5 1,749.9 1,914.6 13.2 BB/Ba 2,114.9 1,917.2 6.6 1,840.9 1,808.3 12.4 B/B 48.2 49.6 0.2 115.0 114.8 0.8 Lower than B/B 79.7 80.0 0.3 58.4 62.9 0.4 Unrated (1)(2) 3,928.2 3,705.9 12.8 2,935.3 3,092.5 21.3 Total 29,968.6 29,001.2 100.0 14,221.1 14,533.6 100.0 (1) Comprised primarily of the fair value of the company’s investments in Blackberry Limited of $285.0 (December 31, 2021 - $535.1 ), JAB Pet Holdings Ltd. of $239.1 (December 31, 2021 - nil ) and Mosaic Capital of $81.7 (December 31, 2021 – $129.3 ). (2) Includes the company’s investments in first mortgage loans at December 31, 2022 of $2,500.7 (December 31, 2021 - $1,659.4 ) secured by real estate predominantly in the U.S., Europe and Canada, with weighted average loan-to-value ratio of approximately 60% , reducing the company’s credit risk exposure related to these investments. At December 31, 2022, 80.1% (December 31, 2021 – 65.1%) of the fixed income portfolio’s carrying value was rated investment grade or better, with 60.6% (December 31, 2021 – 39.1%) rated AA or better (primarily consisting of government bonds). The increase in the fair value of bonds rated AAA/Aaa primarily reflected net purchases of U.S. treasury and Canadian government bonds with 1 At December 31, 2022 holdings of bonds in the ten issuers to which the company had the greatest exposure (excluding U.S., Canadian, U.K. and German sovereign government bonds) totaled $3,599.2 (December 31, 2021 - $3,444.5), which represented approximately 6.5% (December 31, 2021 – 6.5%) of the total investment portfolio. Exposure to the largest single issuer of corporate bonds at December 31, 2022 was the company’s investment in BP Capital Markets America Inc. of $427.7 (December 31, 2021 – Blackberry Limited of $535.1), which represented approximately 0.8% (December 31, 2021 – 1.0%) of the total investment portfolio. Counterparties to derivative contracts Counterparty risk arises from the company’s derivative contracts primarily in three ways: first, a counterparty may be unable to honour its obligation under a derivative contract and have insufficient collateral pledged in favour of the company to support that obligation; second, collateral deposited by the company to a counterparty as a prerequisite for entering into certain derivative contracts (also known as initial margin) may be at risk should the counterparty face financial difficulty; and third, excess collateral pledged in favour of a counterparty may be at risk should the counterparty face financial difficulty (counterparties may hold excess collateral as a result of the timing of the settlement of the amount of collateral required to be pledged based on the fair value of a derivative contract). The company endeavours to limit counterparty risk through diligent selection of counterparties to its derivative contracts and through the terms of negotiated agreements. Pursuant to these agreements, counterparties are contractually required to deposit eligible collateral in collateral accounts (subject to certain minimum thresholds) for the benefit of the company based on the daily fair value of the derivative contracts. The company’s exposure to risk associated with providing initial margin is mitigated where possible through the use of segregated third party custodian accounts that only permit counterparties to take control of the collateral in the event of default by the company. Agreements negotiated with counterparties provide for a single net settlement of all financial instruments covered by the agreement in the event of default by the counterparty, thereby permitting obligations owed by the company to a counterparty to be offset against amounts receivable by the company from that counterparty (the “net settlement arrangements”). The following table sets out the company’s net derivative counterparty risk assuming all derivative counterparties are simultaneously in default: December 31, December 31, 2022 2021 Total derivative assets (1) 256.1 158.9 Obligations that may be offset under net settlement arrangements (33.0) (9.6) Fair value of collateral deposited for the benefit of the company (2) (216.0) (116.5) Excess collateral pledged by the company in favour of counterparties 4.6 4.8 Net derivative counterparty exposure after net settlement and collateral arrangements 11.7 37.6 (1) Excludes equity warrants, equity call options, AVLNs entered with RiverStone Barbados and other derivatives which are not subject to counterparty risk. (2) Excludes excess collateral pledged by counterparties of $68.4 at December 31, 2022 (December 31, 2021 - $22.5 ). Collateral deposited for the benefit of the company at December 31, 2022 consisted of cash of $9.5 and government securities of $274.9 (December 31, 2021 - $14.3 and $125.7). The company had not exercised its right to sell or repledge collateral at December 31, 2022. Recoverable from reinsurers Credit risk on the company’s recoverable from reinsurers balance existed at December 31, 2022 to the extent that any reinsurer may be unable or unwilling to reimburse the company under the terms of the relevant reinsurance arrangements. The company is also exposed to the credit risk assumed in fronting arrangements and to potential reinsurance capacity constraints. The company regularly assesses the creditworthiness of reinsurers with whom it transacts business; internal guidelines generally require reinsurers to have strong A.M. Best ratings and to maintain capital and surplus in excess of $500.0. Where contractually provided for, the company has collateral for outstanding balances in the form of cash, letters of credit, guarantees or assets held in trust accounts. This collateral may be drawn on when amounts remain unpaid beyond contractually specified time periods for each individual reinsurer. The company’s reinsurance analysts conduct ongoing detailed assessments of current and potential reinsurers, perform annual reviews of impaired reinsurers, and provide recommendations for uncollectible reinsurance provisions for the group. The reinsurance analysts also collect and maintain individual operating company and group reinsurance exposures across the company. The company’s single largest recoverable from a reinsurer (Munich Reinsurance Company) represented 8.2% of shareholders’ equity attributable to shareholders of Fairfax at December 31, 2022 (December 31, 2021 - 7.5%) and is rated A+ by A.M. Best. The company’s gross exposure to credit risk from its reinsurers increased at December 31, 2022 compared to December 31, 2021, primarily reflecting an increase in reinsurers’ share of unearned premiums and paid and unpaid losses due to increased business volumes. Changes that occurred in the provision for uncollectible reinsurance during the year are disclosed in note 9. The following table presents the gross recoverable from reinsurers classified according to the financial strength ratings of the reinsurers. Pools and associations are generally government or similar insurance funds with limited credit risk. December 31, 2022 December 31, 2021 Outstanding Outstanding Gross balances for Net unsecured Gross balances for Net unsecured recoverable which security recoverable recoverable which security recoverable A.M. Best Rating (or S&P equivalent) from reinsurers is held from reinsurers from reinsurers is held from reinsurers A++ 600.3 24.2 576.1 568.2 27.2 541.0 A+ 6,631.3 444.1 6,187.2 5,905.9 494.4 5,411.5 A 3,750.9 205.9 3,545.0 3,899.8 227.3 3,672.5 A- 478.4 53.6 424.8 371.9 43.9 328.0 B++ 55.3 4.3 51.0 50.8 4.6 46.2 B+ 0.8 — 0.8 0.5 0.3 0.2 B or lower 10.6 — 10.6 20.2 0.1 20.1 Not rated 998.8 506.5 492.3 1,004.0 576.7 427.3 Pools and associations 761.3 6.6 754.7 447.9 7.1 440.8 13,287.7 1,245.2 12,042.5 12,269.2 1,381.6 10,887.6 Provision for uncollectible reinsurance (171.9) (171.9) (178.7) (178.7) Recoverable from reinsurers 13,115.8 11,870.6 12,090.5 10,708.9 Liquidity Risk Liquidity risk is the potential for loss if the company is unable to meet financial commitments in a timely manner at reasonable cost as they fall due. The company’s cash flows in the near term may be impacted by the need to provide capital to support growth in the insurance and reinsurance companies in a favourable pricing environment and to support fluctuations in their investment portfolios due to the economic uncertainty caused by increased inflationary pressures that have resulted in central banks across the world simultaneously raising interest rates to address inflation. The company’s policy is to ensure that sufficient liquid assets are available to meet financial commitments, including liabilities to policyholders and debt holders, dividends on preferred shares and investment commitments. Cash flow analysis is performed regularly at both the holding company and operating companies to ensure that future cash needs are met or exceeded by cash flows generated by operating companies. Holding Company The holding company’s known significant commitments |
Segmented Information
Segmented Information | 12 Months Ended |
Dec. 31, 2022 | |
Segmented Information | |
Segmented Information | 25. Segmented Information The company is a holding company which, through its subsidiaries, is primarily engaged in property and casualty insurance and reinsurance and the associated investment management. On April 1, 2022 the company revised its property and casualty insurance and reinsurance reporting segments to those described below and believes the revised reporting segments provide better insight into the company’s evaluation of operating performance, insurance risk exposure and strategic opportunities for these operating companies. The operating companies comprising each new reporting segment are similar in insurance risks underwritten, distribution methods used, and customer type and geographic areas served. Comparative periods have been revised to align with the new property and casualty insurance and reinsurance reporting segments. There were no changes to the company’s other reporting segments. Life insurance and Run-off, which did not change, is comprised of Eurolife and Run-off and represents an aggregation of operating segments which are not included in any other reporting segment. Transactions between reporting segments have not been eliminated from individual segment results as management considers those transactions in assessing the performance of each segment. Property and Casualty Insurance and Reinsurance North American Insurers – Global Insurers and Reinsurers – International Insurers and Reinsurers – Life insurance and Run-off This reporting segment is comprised of Eurolife’s life insurance operations and U.S. Run-off, which includes TIG Insurance Company. Non-insurance companies This reporting segment is comprised as follows: Restaurants and retail Fairfax India Thomas Cook India Other On July 5, 2022 the company commenced consolidating Grivalia Hospitality in the Non-insurance companies reporting segment, and on October 31, 2022 the Crum & Forster Pet Insurance Group and Pethealth were deconsolidated from the North American Insurers and Non-insurance companies reporting segments respectively, pursuant to the transactions described in note 23 There were no other significant changes to the identifiable assets and liabilities by operating segment at December 31, 2022 compared to December 31, 2021. Corporate and Other Corporate and Other includes the parent entity (Fairfax Financial Holdings Limited), its subsidiary intermediate holding companies and Hamblin Watsa, an investment management company. Sources of Earnings by Reporting Segment Sources of earnings by reporting segment for the years ended December 31 were as follows: 2022 Property and Casualty Insurance and Reinsurance Life North Global International insurance Non- Eliminations American Insurers and Insurers and and insurance Corporate and Insurers Reinsurers Reinsurers Total Run-off companies and Other adjustments Consolidated Gross premiums written External 7,600.9 16,995.6 2,965.2 27,561.7 350.9 — — — 27,912.6 Intercompany 49.6 101.0 213.4 364.0 — — — (364.0) — 7,650.5 17,096.6 3,178.6 27,925.7 350.9 — — (364.0) 27,912.6 Net premiums written 6,457.6 13,506.3 1,963.1 21,927.0 344.7 — — — 22,271.7 Net premiums earned External 6,140.8 12,851.5 1,671.4 20,663.7 342.4 — — — 21,006.1 Intercompany (33.0) (124.6) 157.6 — — — — — — 6,107.8 12,726.9 1,829.0 20,663.7 342.4 — — — 21,006.1 Underwriting expenses (1) (5,674.8) (12,067.9) (1,815.7) (19,558.4) (509.7) — — 0.5 (20,067.6) Underwriting profit (loss) 433.0 659.0 13.3 1,105.3 (167.3) — — 0.5 938.5 Interest income 249.0 447.8 99.0 795.8 56.4 10.2 11.8 (0.7) 873.5 Dividends 32.0 54.9 16.0 102.9 12.3 24.6 0.6 — 140.4 Investment expenses (47.0) (89.4) (16.2) (152.6) (13.1) (8.2) (2.8) 124.6 (52.1) Interest and dividends 234.0 413.3 98.8 746.1 55.6 26.6 9.6 123.9 961.8 Share of profit of associates 239.8 429.3 52.4 721.5 56.4 134.0 102.8 — 1,014.7 Other Revenue — — — — — 5,581.6 — — 5,581.6 Expenses — — — — — (5,520.9) — — (5,520.9) — — — — — 60.7 — — 60.7 Operating income (loss) 906.8 1,501.6 164.5 2,572.9 (55.3) 221.3 112.4 124.4 2,975.7 Net gains (losses) on investments (397.7) (1,151.1) (211.1) (1,759.9) (306.5) 71.4 261.1 — (1,733.9) Gain on sale and consolidation of insurance subsidiaries (note 23) 1,213.2 — 6.5 1,219.7 — — — — 1,219.7 Interest expense (5.7) (51.1) (3.0) (59.8) (13.2) (122.8) (257.2) 0.2 (452.8) Corporate overhead and other (39.8) (98.9) (12.1) (150.8) (1.4) — (19.9) (124.6) (296.7) Pre-tax income (loss) 1,676.8 200.5 (55.2) 1,822.1 (376.4) 169.9 96.4 — 1,712.0 Provision for income taxes (425.2) Net earnings 1,286.8 Attributable to: Shareholders of Fairfax 1,147.2 Non-controlling interests 139.6 1,286.8 (1) Property and casualty insurance and reinsurance underwriting expenses for the year ended December 31, 2022 were comprised as shown below. Accident year underwriting expenses exclude the impact of favourable or adverse prior year claims reserve development. Property and Casualty Insurance and Reinsurance North Global International American Insurers and Insurers and Insurers Reinsurers Reinsurers Total Loss & LAE - accident year 3,733.4 8,715.7 1,207.3 13,656.4 Commissions 998.3 2,109.5 324.4 3,432.2 Other underwriting expenses 1,020.3 1,263.8 381.9 2,666.0 Underwriting expenses - accident year 5,752.0 12,089.0 1,913.6 19,754.6 Net favourable claims reserve development (77.2) (21.1) (97.9) (196.2) Underwriting expenses - calendar year 5,674.8 12,067.9 1,815.7 19,558.4 2021 Property and Casualty Insurance and Reinsurance North Global International Life insurance Non- Eliminations American Insurers and Insurers and and insurance Corporate and Insurers Reinsurers Reinsurers Total Run-off companies and Other adjustments Consolidated Gross premiums written External 6,544.6 14,567.6 2,683.8 23,796.0 114.2 — — — 23,910.2 Intercompany 34.2 93.8 169.5 297.5 358.1 — — (655.6) — 6,578.8 14,661.4 2,853.3 24,093.5 472.3 — — (655.6) 23,910.2 Net premiums written 5,319.7 10,755.5 1,734.2 17,809.4 468.7 — — — 18,278.1 Net premiums earned External 5,435.3 9,530.6 1,482.4 16,448.3 109.7 — — — 16,558.0 Intercompany (410.5) (78.8) 131.2 (358.1) 358.1 — — — — 5,024.8 9,451.8 1,613.6 16,090.2 467.8 — — — 16,558.0 Underwriting expenses (2) (4,637.9) (9,077.6) (1,573.5) (15,289.0) (776.8) — — 0.3 (16,065.5) Underwriting profit (loss) 386.9 374.2 40.1 801.2 (309.0) — — 0.3 492.5 Interest income 154.4 299.6 66.8 520.8 22.2 3.9 28.2 (6.7) 568.4 Dividends 23.9 37.2 11.6 72.7 7.8 28.5 (0.8) — 108.2 Investment expenses (43.2) (100.1) (8.5) (151.8) (10.7) (127.1) (2.8) 256.6 (35.8) Interest and dividends 135.1 236.7 69.9 441.7 19.3 (94.7) 24.6 249.9 640.8 Share of profit of associates 103.6 184.8 35.7 324.1 16.8 22.3 38.8 — 402.0 Other Revenue — — — — — 5,157.5 — 0.5 5,158.0 Expenses — — — — — (5,092.1) — 5.2 (5,086.9) — — — — — 65.4 — 5.7 71.1 Operating income (loss) 625.6 795.7 145.7 1,567.0 (272.9) (7.0) 63.4 255.9 1,606.4 Net gains on investments (1) 518.5 604.1 1,521.9 2,644.5 69.7 266.0 464.9 — 3,445.1 Gain on sale and consolidation of insurance subsidiaries (note 23) — 68.7 64.8 133.5 — — 130.5 — 264.0 Interest expense (8.6) (50.5) (2.4) (61.5) (7.9) (140.3) (305.4) 1.2 (513.9) Corporate overhead and other (53.7) (88.0) (22.3) (164.0) (38.4) — 50.0 (256.6) (409.0) Pre-tax income (loss) 1,081.8 1,330.0 1,707.7 4,119.5 (249.5) 118.7 403.4 0.5 4,392.6 Provision for income taxes (726.0) Net earnings 3,666.6 Attributable to: Shareholders of Fairfax 3,401.1 Non-controlling interests 265.5 3,666.6 (1) Includes net gains on deconsolidation of non-insurance subsidiaries primarily related to the deconsolidation of Fairfax India’s subsidiary Privi of $94.9 and Toys “R” Us Canada of $85.7 as described in note 23. (2) Property and casualty insurance and reinsurance underwriting expenses for the year ended December 31, 2021 were comprised as shown below. Accident year underwriting expenses exclude the impact of favourable or adverse prior year claims reserve development. Property and Casualty Insurance and Reinsurance North Global International American Insurers and Insurers and Insurers Reinsurers Reinsurers Total Loss & LAE - accident year 2,900.3 6,551.6 986.6 10,438.5 Commissions 913.6 1,571.0 289.6 2,774.2 Other underwriting expenses 927.7 1,156.4 347.8 2,431.9 Underwriting expenses - accident year 4,741.6 9,279.0 1,624.0 15,644.6 Net favourable claims reserve development (103.7) (201.4) (50.5) (355.6) Underwriting expenses - calendar year 4,637.9 9,077.6 1,573.5 15,289.0 Investments in Associates, Additions to Goodwill, Segment Assets and Segment Liabilities Investments in associates, segment assets and segment liabilities at December 31, and additions to goodwill for the years then ended, by reporting segment, were as follows: Investments in associates Additions to goodwill Segment assets Segment liabilities 2022 2021 2022 2021 2022 2021 2022 2021 Property and Casualty Insurance and Reinsurance North American Insurers 1,217.7 801.5 — — 18,664.9 17,418.7 12,890.0 11,551.5 Global Insurers and Reinsurers 2,893.3 2,168.7 — 16.4 51,634.9 46,849.3 39,086.8 34,266.7 International Insurers and Reinsurers 592.0 415.2 — — 9,547.2 9,616.9 5,631.9 5,700.7 4,703.0 3,385.4 — 16.4 79,847.0 73,884.9 57,608.7 51,518.9 Life insurance and Run-off 348.1 272.6 0.4 — 6,087.7 6,669.1 5,289.5 5,781.1 Non-insurance companies 1,378.5 1,379.7 151.6 44.3 8,611.4 7,856.4 4,820.6 4,075.1 Corporate and Other and eliminations and adjustments 1,004.3 1,066.3 — — (2,421.0) (1,765.0) 4,070.5 3,955.0 Consolidated 7,433.9 6,104.0 152.0 60.7 92,125.1 86,645.4 71,789.3 65,330.1 Product Line Net premiums earned by product line for the years ended December 31 were as follows: Property Casualty Specialty (1) Total 2022 2021 2022 2021 2022 2021 2022 2021 Property and Casualty Insurance and Reinsurance - net premiums earned North American Insurers 1,379.3 1,209.6 4,284.3 3,400.2 444.2 415.0 6,107.8 5,024.8 Global Insurers and Reinsurers 4,895.5 3,876.9 6,866.2 4,856.8 965.2 718.1 12,726.9 9,451.8 International Insurers and Reinsurers 919.9 834.9 615.1 544.3 294.0 234.4 1,829.0 1,613.6 7,194.7 5,921.4 11,765.6 8,801.3 1,703.4 1,367.5 20,663.7 16,090.2 Life insurance and Run-off (1) — 8.2 0.5 348.8 341.9 110.8 342.4 467.8 Consolidated net premiums earned 7,194.7 5,929.6 11,766.1 9,150.1 2,045.3 1,478.3 21,006.1 16,558.0 Interest and dividends 961.8 640.8 Share of profit of associates 1,014.7 402.0 Net gains (losses) on investments (1,733.9) 3,445.1 Gain on sale and consolidation of insurance subsidiaries (note 23) 1,219.7 264.0 Other revenue 5,581.6 5,158.0 Consolidated income 28,050.0 26,467.9 Distribution of net premiums earned 34.3 % 35.8 % 56.0 % 55.3 % 9.7 % 8.9 % 100.0 % 100.0 % (1) Includes Eurolife’s life insurance operations since Eurolife’s consolidation on July 14, 2021, as described in note 23. Geographic Region Net premiums earned by geographic region for the years ended December 31 were as follows: Canada United States Asia (1) International (2) Total 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 Property and Casualty Insurance and Reinsurance - net premiums earned North American Insurers 1,914.1 1,784.9 4,157.5 3,222.1 1.4 1.2 34.8 16.6 6,107.8 5,024.8 Global Insurers and Reinsurers 378.8 293.1 9,337.3 6,671.4 878.1 806.9 2,132.7 1,680.4 12,726.9 9,451.8 International Insurers and Reinsurers 0.6 0.2 122.4 81.8 551.9 438.9 1,154.1 1,092.7 1,829.0 1,613.6 2,293.5 2,078.2 13,617.2 9,975.3 1,431.4 1,247.0 3,321.6 2,789.7 20,663.7 16,090.2 Life insurance and Run-off (3) — — 0.5 358.1 — — 341.9 109.7 342.4 467.8 Consolidated net premiums earned 2,293.5 2,078.2 13,617.7 10,333.4 1,431.4 1,247.0 3,663.5 2,899.4 21,006.1 16,558.0 Interest and dividends 961.8 640.8 Share of profit of associates 1,014.7 402.0 Net gains (losses) on investments (1,733.9) 3,445.1 Gain on sale and consolidation of insurance subsidiaries (note 23) 1,219.7 264.0 Other revenue 5,581.6 5,158.0 Consolidated income 28,050.0 26,467.9 Distribution of net premiums earned 10.9 % 12.6 % 64.9 % 62.4 % 6.8 % 7.5 % 17.4 % 17.5 % 100.0% 100.0% (1) The Asia geographic segment is primarily comprised of countries located throughout Asia, including China, Japan, India, Sri Lanka, Malaysia, Singapore, Indonesia and South Korea, and the Middle East. (2) The International geographic segment is primarily comprised of countries located in South America, Europe, Africa and Oceania. (3) Includes Eurolife’s life insurance operations since Eurolife’s consolidation on July 14, 2021, as described in note 23. Non-insurance companies Revenue and expenses of the Non-insurance companies reporting segment were comprised as follows for the years ended December 31: Restaurants and retail Fairfax India (1) Thomas Cook India (2) Other (3) Total 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 Revenue 1,710.3 1,803.8 216.7 228.2 611.0 249.4 3,043.6 2,876.1 5,581.6 5,157.5 Expenses (1,582.2) (1,724.8) (208.1) (206.9) (600.8) (293.4) (3,129.8) (2,867.0) (5,520.9) (5,092.1) Pre-tax income (loss) before interest expense and other (4) 128.1 79.0 8.6 21.3 10.2 (44.0) (86.2) 9.1 60.7 65.4 Interest and dividends 9.9 7.5 21.4 (102.2) — (0.1) (4.7) 0.1 26.6 (94.7) Share of profit (loss) of associates (0.1) — 132.0 20.2 0.3 (0.1) 1.8 2.2 134.0 22.3 Operating income (loss) 137.9 86.5 162.0 (60.7) 10.5 (44.2) (89.1) 11.4 221.3 (7.0) (1) These results differ from those published by Fairfax India primarily due to Fairfax India’s application of investment entity accounting under IFRS. (2) These results differ from those published by Thomas Cook India primarily due to differences between IFRS and Ind AS, and acquisition accounting adjustments. (3) Included in Expenses is a non-cash goodwill impairment charge on Farmers Edge of $133.4 recognized in 2022. (4) Excludes interest and dividends, share of profit (loss) of associates and net gains (losses) on investments. Segmented Balance Sheet The company’s segmented balance sheets as at December 31, 2022 and 2021 present the assets, liabilities and non-controlling interests of each reporting segment in accordance with the company’s IFRS accounting policies and includes, where applicable, acquisition accounting adjustments principally related to goodwill and intangible assets which arose on initial acquisition of the subsidiaries or on a subsequent step acquisition. Certain of the company’s subsidiaries hold equity interests in other Fairfax subsidiaries (“affiliates”) which are carried at cost. In the table below, the company’s three property and casualty insurance and reinsurance reporting segments have been presented in aggregate, and affiliated insurance and reinsurance balances are not shown separately and are eliminated in “Corporate and eliminations”. December 31, 2022 December 31, 2021 Property Property and and casualty Life casualty Life insurance and insurance Non- Corporate insurance and insurance Non- Corporate reinsurance and insurance and reinsurance and insurance and companies Run-off companies eliminations (4) Consolidated companies Run-off companies eliminations (4) Consolidated Assets Holding company cash and investments 316.6 — — 1,029.2 1,345.8 604.5 — — 873.8 1,478.3 Insurance contract receivables 8,310.9 28.2 — (431.6) 7,907.5 7,215.5 7.8 — (340.1) 6,883.2 Portfolio investments (1) 49,038.8 4,275.4 2,119.3 (1,110.6) 54,322.9 45,061.8 4,963.9 2,252.8 (581.1) 51,697.4 Deferred premium acquisition costs 2,201.3 7.5 — (38.5) 2,170.3 1,950.6 3.8 — (30.3) 1,924.1 Recoverable from reinsurers 14,097.9 517.5 — (1,499.6) 13,115.8 13,060.3 457.6 — (1,427.4) 12,090.5 Deferred income tax assets 337.3 25.6 54.5 74.7 492.1 268.2 29.0 66.9 158.3 522.4 Goodwill and intangible assets 3,396.8 7.5 2,284.4 0.3 5,689.0 3,579.5 7.5 2,341.2 — 5,928.2 Due from affiliates 206.3 364.1 — (570.4) — 231.3 360.2 — (591.5) — Other assets 1,774.0 832.6 4,153.2 321.9 7,081.7 1,746.0 810.0 3,195.5 369.8 6,121.3 Investments in affiliates (2) 167.1 29.3 — (196.4) — 167.2 29.3 — (196.5) — Total assets 79,847.0 6,087.7 8,611.4 (2,421.0) 92,125.1 73,884.9 6,669.1 7,856.4 (1,765.0) 86,645.4 Liabilities Accounts payable and accrued liabilities 2,304.9 263.1 2,430.7 216.5 5,215.2 2,149.9 233.4 2,077.4 524.7 4,985.4 Derivative obligations 113.5 — 58.2 19.3 191.0 72.5 — 47.9 32.5 152.9 Due to affiliates 16.5 0.4 82.4 (99.3) — 28.8 0.2 135.1 (164.1) — Deferred income tax liabilities 225.0 18.5 252.4 0.8 496.7 322.2 72.9 198.5 5.2 598.8 Insurance contract payables 4,839.7 688.4 — (466.2) 5,061.9 4,208.6 652.0 — (367.1) 4,493.5 Provision for losses and loss adjustment expenses (3) 37,531.7 4,300.9 — (1,343.0) 40,489.6 33,381.4 4,806.1 — (1,295.2) 36,892.3 Provision for unearned premiums (3) 11,844.0 18.2 — (152.2) 11,710.0 10,564.8 16.5 — (127.1) 10,454.2 Borrowings 733.4 — 1,996.9 5,894.6 8,624.9 790.7 — 1,616.2 5,346.1 7,753.0 Total liabilities 57,608.7 5,289.5 4,820.6 4,070.5 71,789.3 51,518.9 5,781.1 4,075.1 3,955.0 65,330.1 Equity Shareholders’ equity attributable to shareholders of Fairfax 20,269.1 798.2 2,100.4 (6,491.5) 16,676.2 19,778.9 888.0 1,782.5 (6,064.3) 16,385.1 Non-controlling interests 1,969.2 — 1,690.4 — 3,659.6 2,587.1 — 1,998.8 344.3 4,930.2 Total equity 22,238.3 798.2 3,790.8 (6,491.5) 20,335.8 22,366.0 888.0 3,781.3 (5,720.0) 21,315.3 Total liabilities and total equity 79,847.0 6,087.7 8,611.4 (2,421.0) 92,125.1 73,884.9 6,669.1 7,856.4 (1,765.0) 86,645.4 (1) Includes intercompany investments in Fairfax non-insurance subsidiaries carried at cost that are eliminated on consolidation. (2) Intercompany investments in Fairfax insurance and reinsurance subsidiaries carried at cost that are eliminated on consolidation. (3) Included in insurance contract liabilities on the consolidated balance sheet. (4) Corporate and eliminations includes the Fairfax holding company, subsidiary intermediate holding companies, and consolidating and eliminating entries. The most significant of those entries are the elimination of intercompany reinsurance provided by Group Re, and reinsurance provided by Odyssey Group and Allied World to affiliated primary insurers. |
Expenses
Expenses | 12 Months Ended |
Dec. 31, 2022 | |
Expenses | |
Expenses | 26. Expenses Losses on claims, net, operating expenses and other expenses for the years ended December 31 were comprised as follows: 2022 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total Losses and loss adjustment expenses, property and casualty 13,169.1 — 13,169.1 10,272.9 — 10,272.9 Provisions and claims, Eurolife 251.1 — 251.1 81.0 — 81.0 Cost of sales — 3,349.4 3,349.4 — 2,987.5 2,987.5 Wages and salaries 1,580.8 877.5 2,458.3 1,547.1 761.3 2,308.4 Depreciation, amortization and impairment charges 233.2 450.4 683.6 291.0 639.4 930.4 Employee benefits 381.3 125.9 507.2 345.3 116.9 462.2 Premium taxes 306.8 — 306.8 285.9 — 285.9 Information technology costs 254.7 44.5 299.2 216.3 40.7 257.0 Audit, legal and tax professional fees 189.1 53.7 242.8 159.7 43.4 203.1 Repairs, maintenance and utilities 14.4 163.9 178.3 13.2 144.2 157.4 Shipping and delivery 1.3 152.8 154.1 1.2 120.0 121.2 Share-based payments to directors and employees 131.5 20.4 151.9 118.2 18.3 136.5 Marketing costs 38.9 76.6 115.5 33.4 70.1 103.5 Administrative expense and other 357.2 205.8 563.0 321.4 145.1 466.5 Losses on claims, net, operating expenses and other expenses (2)(3) 16,909.4 5,520.9 22,430.3 13,686.6 5,086.9 18,773.5 Commissions, net (note 9) (4) 3,454.9 — 3,454.9 2,787.9 — 2,787.9 Interest expense (note 15) (4) 330.0 122.8 452.8 373.6 140.3 513.9 20,694.3 5,643.7 26,338.0 16,848.1 5,227.2 22,075.3 (1) Includes Life insurance and Run-off and Corporate and Other. (2) Expenses of the insurance and reinsurance companies, excluding commissions, net and interest expense, are included in losses on claims, net and operating expenses in the consolidated statement of earnings. (3) Expenses of the non-insurance companies, excluding commissions, net and interest expense, are included in other expenses in the consolidated statement of earnings. (4) Presented as separate lines in the consolidated statement of earnings. |
Supplementary Cash Flow Informa
Supplementary Cash Flow Information | 12 Months Ended |
Dec. 31, 2022 | |
Supplementary Cash Flow Information | |
Supplementary Cash Flow Information | 27. Cash, cash equivalents and bank overdrafts as presented in the consolidated statements of cash flows excludes restricted cash and cash equivalents that are amounts primarily required to be maintained on deposit with various regulatory authorities to support the operations of the property and casualty insurance and reinsurance subsidiaries. Cash equivalents are comprised of treasury bills and other eligible bills. December 31, 2022 Unrestricted cash and cash equivalents included in the Cash and cash equivalents included on consolidated statement of cash flows Restricted cash and cash equivalents the consolidated balance sheet Cash Cash Cash Cash equivalents Total Cash equivalents Total Cash equivalents Total Holding company cash and investments 72.7 479.4 552.1 — — — 72.7 479.4 552.1 Holding company assets pledged for derivative obligations — 40.6 40.6 — — — — 40.6 40.6 Subsidiary cash and short term investments 3,243.3 2,105.6 5,348.9 500.8 353.6 854.4 3,744.1 2,459.2 6,203.3 Fairfax India 34.5 143.5 178.0 0.8 6.0 6.8 35.3 149.5 184.8 3,350.5 2,769.1 6,119.6 501.6 359.6 861.2 3,852.1 3,128.7 6,980.8 December 31, 2021 Unrestricted cash and cash equivalents included in the consolidated statement Cash and cash equivalents included on of cash flows Restricted cash and cash equivalents the consolidated balance sheet Cash Cash Cash Cash equivalents Total Cash equivalents Total Cash equivalents Total Holding company cash and investments 129.9 336.0 465.9 — — — 129.9 336.0 465.9 Holding company assets pledged for derivative obligations — 46.8 46.8 — — — — 46.8 46.8 Subsidiary cash and short term investments 5,259.2 5,777.6 11,036.8 484.6 761.8 1,246.4 5,743.8 6,539.4 12,283.2 Subsidiary assets pledged for derivative obligations — 74.0 74.0 — — — — 74.0 74.0 Fairfax India 35.1 26.8 61.9 1.6 13.0 14.6 36.7 39.8 76.5 5,424.2 6,261.2 11,685.4 486.2 774.8 1,261.0 5,910.4 7,036.0 12,946.4 Details of certain cash flows included in the consolidated statement of cash flows for the years ended December 31 were as follows: 2022 2021 Net (purchases) sales of investments classified at FVTPL Short term investments 6,352.5 (767.1) Bonds (16,016.2) 2,545.7 Preferred stocks (293.2) (37.3) Common stocks (63.6) 477.2 Net derivatives and other invested assets 380.3 395.9 (9,640.2) 2,614.4 Changes in operating assets and liabilities Net decrease (increase) in restricted cash and cash equivalents 393.7 (472.6) Provision for losses and loss adjustment expenses 4,530.1 3,692.0 Provision for unearned premiums 1,455.3 2,152.2 Provision for life policy benefits (142.4) (167.9) Insurance contract receivables (1,134.9) (1,152.9) Insurance contract payables 625.8 1,079.8 Recoverable from reinsurers (1,257.9) (1,580.0) Other receivables (349.8) (96.7) Accounts payable and accrued liabilities 338.2 291.1 Other (638.0) (758.1) 3,820.1 2,986.9 Net interest and dividends received Interest and dividends received 1,030.8 865.7 Interest paid on borrowings (360.5) (366.7) Interest paid on lease liabilities (48.1) (54.8) 622.2 444.2 Net income taxes paid (416.4) (288.7) |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions | |
Related Party Transactions | 28. Management and Director Compensation Compensation for the company’s key management team for the years ended December 31 determined in accordance with the company’s IFRS accounting policies was as follows: 2022 2021 Salaries and other short-term employee benefits 10.2 10.8 Share-based payments 5.7 4.7 15.9 15.5 Compensation for the company’s Board of Directors for the years ended December 31 was as follows: 2022 2021 Retainers and fees 1.7 1.5 Share-based payments 0.3 0.4 2.0 1.9 Transactions with subsidiaries Thomas Cook India conversion of preferred shares During 2022 the company converted its preferred shares in Thomas Cook India to common shares, which increased the company’s ownership interest by 6.6%. See note 16. Fairfax India Performance Fee Receivable On December 31, 2022 the holding company had a performance fee receivable of $41.5 pursuant to its investment advisory agreement with Fairfax India for the period from January 1, 2021 to December 31, 2023. This intercompany receivable is eliminated in the company’s consolidated financial reporting. Under the investment advisory agreement, if a performance fee is payable for the period ending on December 31, 2023, the performance fee will be payable in cash, or at Fairfax’s option, in subordinate voting shares of Fairfax India. If Fairfax elects to have the performance fee paid in subordinate voting shares, such election must be made no later than December 15, 2023. |
Subsidiaries
Subsidiaries | 12 Months Ended |
Dec. 31, 2022 | |
Subsidiaries | |
Subsidiaries | 29. The company’s principal operating subsidiaries are presented in the tables below. During 2022 the company consolidated Grivalia Hospitality as described in note 23. Excluded from these tables are intermediate holding companies of investments in subsidiaries and intercompany balances that are eliminated on consolidation. Fairfax’s ownership (100% other than as December 31, 2022 Domicile shown below) Property and casualty insurance and reinsurance North American Insurers Northbridge Financial Corporation (Northbridge) Canada Crum & Forster Holdings Corp. (Crum & Forster) United States Zenith National Insurance Corp. (Zenith National) United States Global Insurers and Reinsurers Odyssey Group Holdings, Inc. (Odyssey Group) United States 90.0 % Brit Limited (Brit) United Kingdom 86.2 % Allied World Assurance Company Holdings, Ltd (Allied World) Bermuda 82.9 % International Insurers and Reinsurers Fairfax Central and Eastern Europe, which consists of: Polskie Towarzystwo Reasekuracji Spólka Akcyjna (Polish Re) Poland Colonnade Insurance S.A. (Colonnade Insurance) Luxembourg FFH Ukraine Holdings (Fairfax Ukraine), which consists of: Ukraine 70.0 % ARX Insurance Company (ARX Insurance) Ukraine Private Joint Stock Company Insurance Company Universalna (Universalna) Ukraine Fairfax Latin America, which consists of: Fairfax Brasil Seguros Corporativos S.A. (Fairfax Brasil) Brazil La Meridional Compañía Argentina de Seguros S.A. (La Meridional Argentina) Argentina SBS Seguros Colombia S.A. (Southbridge Colombia) Colombia SBI Seguros Uruguay S.A. (Southbridge Uruguay) Uruguay Southbridge Compañía de Seguros Generales S.A. (Southbridge Chile) Chile Bryte Insurance Company Ltd (Bryte Insurance) South Africa Eurolife FFH General Insurance Single Member S.A. (Eurolife General) Greece 80.0 % Group Re, which underwrites business in: CRC Reinsurance Limited (CRC Re) Barbados Wentworth Insurance Company Ltd. (Wentworth) Barbados Connemara Reinsurance Company Ltd. (Connemara) Barbados Fairfax Asia, which consists of: Falcon Insurance Company (Hong Kong) Limited (Falcon) Hong Kong The Pacific Insurance Berhad (Pacific Insurance) Malaysia 85.0 % PT Asuransi Multi Artha Guna Tbk (AMAG Insurance) Indonesia 80.3 % Fairfirst Insurance Limited (Fairfirst Insurance) Sri Lanka 78.0 % Singapore Reinsurance Corporation Limited (Singapore Re) Singapore Life insurance and Run-off Eurolife FFH Life Insurance Group Holdings S.A. (Eurolife) Greece 80.0 % Run-off , which is principally comprised of: U.S. Run-off: TIG Insurance Company (TIG Insurance) United States Investment management Hamblin Watsa Investment Counsel Ltd. (Hamblin Watsa) Canada Fairfax’s December 31, 2022 Domicile ownership Primary business Non-insurance companies Restaurants and retail Recipe Unlimited Corporation (Recipe) Canada 75.7 % Franchisor, owner and operator of restaurants Sporting Life Group Limited, which owns: Canada 88.5 % Invests in retail businesses 100.0% of Sporting Life Inc. (Sporting Life) Canada 88.5 % Retailer of sporting goods and sports apparel 100.0% of Golf Town Limited (Golf Town) Canada 88.5 % Retailer of golf equipment, apparel and accessories Fairfax India Fairfax India Holdings Corporation (Fairfax India) Canada 34.7 % (1) Invests in public and private Indian businesses Thomas Cook India Thomas Cook (India) Limited (Thomas Cook India), which owns: India 73.3 % Provider of integrated travel and travel-related financial services 100.0% of Sterling Holiday Resorts Limited (Sterling Resorts) India 73.3 % Owner and operator of holiday resorts Other AGT Food and Ingredients Inc. (AGT) Canada 59.6 % Originator, processor and distributor of value-added pulses and staple foods Dexterra Group Inc. (Dexterra Group) Canada 48.7 % (2) Provider of Infrastructure support services Boat Rocker Media Inc. (Boat Rocker) Canada 44.9 % (3) Entertainment content creator, producer and distributor Farmers Edge Inc. (Farmers Edge) Canada 61.3 % Provider of advanced digital tools for agriculture Grivalia Hospitality S.A. (Grivalia Hospitality) Greece 78.4 % Hospitality real estate investor, developer and manager (1) The company owns multiple voting shares and subordinate voting shares of Fairfax India that give it voting rights of 94.4 %. (2) The company has de facto voting control of Dexterra Group as its largest equity and voting shareholder. (3) The company has voting rights of 56.1 % due to Boat Rocker’s issuance of non-voting shares to non-controlling interests. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Consolidation | Consolidation Subsidiaries The consolidated financial statements were prepared as of December 31, 2022 and 2021 based on individual holding companies’ and subsidiaries’ financial statements at those dates. Accounting policies of subsidiaries have been aligned with those of the company where necessary. The company’s significant operating subsidiaries are identified in note 29. Non-controlling interests |
Business combinations | Business combinations Business combinations are accounted for using the acquisition method of accounting whereby the consideration transferred is measured at fair value at the date of acquisition. This consideration may include cash paid and the fair value at the date of exchange of assets given, liabilities assumed and equity instruments issued by the company or its subsidiaries. Directly attributable acquisition-related costs are recorded in operating expenses or other expenses in the consolidated statement of earnings as incurred. At the date of acquisition, the company recognizes the identifiable assets acquired, the liabilities assumed and any non-controlling interest in the acquired business. The identifiable assets acquired and liabilities assumed are initially recognized at fair value. For each business combination the company determines whether to initially record non-controlling interest at fair value or as the proportionate share of the identifiable net assets of the acquired subsidiary. If the consideration transferred is less than the fair value of identifiable net assets acquired, the excess is recognized in the consolidated statement of earnings. An existing equity interest in an acquired subsidiary is remeasured to fair value at the date of the business combination with any gain or loss recognized in net gains (losses) on investments or in gain on sale and consolidation of insurance subsidiaries in the consolidated statement of earnings. |
Goodwill and intangible assets | Goodwill and intangible assets Goodwill Intangible assets Intangible assets are initially recognized at cost, or at fair value when acquired through a business combination. Intangible assets with a finite life are subsequently measured at cost less accumulated amortization and impairment, where amortization is calculated using the straight-line method over the estimated useful life, and carrying value is re-assessed when there are indicators of impairment. Indefinite-lived intangible assets are not subject to amortization and are assessed annually for impairment or more frequently if there are indicators of impairment. When the carrying value of an intangible asset exceeds its recoverable amount, an impairment loss is recorded in operating expenses or other expenses in the consolidated statement of earnings. The estimated useful lives of the company’s intangible assets are as follows: Customer and broker relationships 8 to 20 years Brand names and Lloyd’s participation rights Indefinite Computer software 3 to 15 years Brand names and Lloyd’s participation rights are considered to be indefinite-lived based on their strength, history and expected future use. |
Investment in associates | Investments in associates Investments in associates are accounted for using the equity method and are comprised of investments in corporations, limited partnerships and trusts where the company has the ability to exercise significant influence but not control. An investment in associate is initially recognized at cost and adjusted thereafter for the post-acquisition change in the company’s share of net assets of the associate. The company’s share of profit (loss) and share of other comprehensive income (loss) of associates are reported in the corresponding lines in the consolidated statement of earnings and consolidated statement of comprehensive income, respectively. An existing equity interest in an acquired associate is remeasured to fair value at the date significant influence is obtained and included in the carrying value of the associate. The fair value of associates is estimated at each reporting date using valuation techniques consistent with those applied to the company’s other investments in equity instruments. See “Determination of fair value” under the heading of “Investments” in this note for further details. If there is objective evidence that the carrying value of an associate is impaired, it is written down to its recoverable amount, being the higher of the associate’s fair value and value-in-use. The unrealized impairment loss is recognized in share of profit (loss) of associates in the consolidated statement of earnings. An impairment loss is reversed in future periods if the circumstances that led to the impairment no longer exist. The reversal is limited to restoring the carrying value to what it would have been had no impairment loss been recognized in prior periods. Upon loss of significant influence, any retained equity interest classified as a financial asset is remeasured to fair value and all amounts previously recognized in other comprehensive income (loss) are recycled to the consolidated statement of earnings except those related to defined benefit pension or post retirement plans which are reclassified to retained earnings. Gains and losses on loss of significant influence or disposition of an associate are recognized in net gains (losses) on investments in the consolidated statement of earnings. |
Investments in joint ventures | Investments in joint ventures Investments in joint ventures are accounted for using the equity method (as described in the preceding paragraphs) and are comprised of investments in corporations and limited partnerships where the company has joint control together with one or more third parties by contractual agreement. Joint control requires the unanimous consent of all parties sharing control to make decisions regarding the joint venture’s relevant activities. When a subsidiary constituting a business is contributed to a joint venture, any gain or loss on derecognition of the subsidiary, including recycling of applicable amounts in accumulated other comprehensive income (loss) and remeasurement to fair value of any retained interest in the subsidiary, is recognized in the consolidated statement of earnings. Upon loss of joint control, any retained equity interest classified as a financial asset is remeasured to fair value and all amounts previously recognized in other comprehensive income (loss) are reclassified to the consolidated statement of earnings except those related to defined benefit pension or post retirement plans which are reclassified to retained earnings. Gains and losses on loss of joint control or disposition of a joint venture are recognized in net gains (losses) on investments in the consolidated statement of earnings. Investments in joint ventures and all related activity are presented with investments in associates in these consolidated financial statements. |
Consolidated statement of cash flows | Consolidated statement of cash flows The company’s consolidated statement of cash flows is prepared in accordance with the indirect method, classifying cash flows by operating, investing and financing activities. Cash and cash equivalents |
Investments | Investments Investments include cash and cash equivalents, short term investments, bonds, equity instruments, investments in associates, derivative assets, other invested assets (primarily investment property) and derivative obligations. Management determines the appropriate classifications of investments at their acquisition date. Classification - Recognition and measurement - Subsequent to initial recognition, investments classified at FVTPL are measured at fair value with changes in fair value reported in the consolidated statement of earnings as income, comprised of interest and dividends and net gains (losses) on investments. Interest and dividends represent interest income on short term investments and bonds calculated using the effective interest method, and dividends received on holdings of common stocks and preferred stocks, net of investment expenses. All other changes in fair value are reported in net gains (losses) on investments in the consolidated statement of earnings. For short term investments and bonds, the sum of their interest income and net gains (losses) on investments is equal to their total change in fair value for the reporting period. For investments classified at FVTPL, the company further disaggregates net gains (losses) on investments into realized and unrealized components in note 5. Where a financial instrument continues to be held by the company at the end of a reporting period, changes in the fair value of that instrument during the reporting period, excluding those changes reported as interest and dividends, are presented in net change in unrealized gains (losses). On disposition or as a result of a change in accounting for that financial instrument, its inception-to-date net gain (loss), excluding those changes previously reported as interest and dividends, is presented as net realized gains (losses). The cumulative unrealized net gain (loss) recognized in prior periods on that financial instrument is then reversed in net change in unrealized gains (losses). The sum of the inception-to-date net gain (loss) and the cumulative reversal of prior period net unrealized gains (losses) equals that financial instrument’s net gain (loss) on investment for the current reporting period as presented in the consolidated statement of earnings. Interest and dividends and net gains (losses) on investments are reported as operating activities in the consolidated statement of cash flows. Derecognition Short term investments Bonds Derivatives The company uses derivatives for investment purposes and to mitigate financial risks arising from its investment holdings and reinsurance recoverables, and monitors its derivatives for effectiveness in achieving their risk management objectives where applicable. The fair value of derivatives in a gain position are presented on the consolidated balance sheet in holding company cash and investments, and in portfolio investments as derivatives and other invested assets. The fair value of derivatives in a loss position are presented on the consolidated balance sheet in derivative obligations. The initial premium paid for a derivative contract, if any, is recorded as a derivative asset and subsequently adjusted for changes in the fair value of the contract at each reporting date. Changes in the fair value of derivatives are recorded as net gains (losses) on investments in the consolidated statement of earnings. Cash received from counterparties as collateral for derivative contracts is recognized on the consolidated balance sheet in holding company cash and investments or subsidiary cash and short term investments, and a corresponding liability is recognized in accounts payable and accrued liabilities. Securities received from counterparties as collateral are not recorded as assets. Cash and securities delivered to counterparties as collateral for derivative contracts continue to be reflected as assets on the consolidated balance sheet in holding company cash and investments or in portfolio investments as assets pledged for derivative obligations. The portion of the collateral related to changes in fair value of derivative contracts may be repledged by the counterparties holding the collateral. Determination of fair value Level 1 - Inputs represent unadjusted quoted prices for identical instruments exchanged in active markets. The fair values of the majority of the company’s common stocks, equity call options and certain warrants are based on published quotes in active markets. Level 2 - Inputs include directly or indirectly observable inputs (other than Level 1 inputs) such as quoted prices for similar financial instruments exchanged in active markets, quoted prices for identical or similar financial instruments exchanged in inactive markets and other market observable inputs. The fair value of the vast majority of the company’s investments in bonds are priced based on information provided by independent pricing service providers while much of the remainder, along with most derivative contracts (including total return swaps, U.S. treasury bond forward contracts and certain warrants) are based primarily on non-binding third party broker-dealer quotes that are prepared using Level 2 inputs. Where third party broker-dealer quotes are used, typically one quote is obtained from a broker-dealer with particular expertise in the instrument being priced. Preferred stocks are priced using a combination of independent pricing service providers and internal valuation models that rely on directly or indirectly observable inputs. The fair values of investments in certain limited partnerships classified as common stocks on the consolidated balance sheet are based on the net asset values received from the general partner, adjusted for liquidity as required and are classified as Level 2 when they may be liquidated or redeemed within three months or less of providing notice to the general partner. All other such investments in limited partnerships are classified as Level 3. Level 3 - Inputs include unobservable inputs that management uses to develop assumptions for which market data is limited or unavailable at the measurement date. In some instances, such as for private company preferred shares, management will use limited recent market transactions that are corroborated by industry accepted discounted cash flow models that incorporate one or more unobservable inputs. Transfers between fair value hierarchy levels are considered effective from the beginning of the annual reporting period in which the transfer is identified. Valuation techniques used by the company’s independent pricing service providers and third party broker-dealers include use of prices from similar instruments where observable market prices exist, discounted cash flow analysis, option pricing models, and other valuation techniques commonly used by market participants. The company assesses the reasonableness of pricing received from these third party sources by comparing the fair values received to recent transaction prices for similar assets where available, to industry accepted discounted cash flow models (that incorporate estimates of the amount and timing of future cash flows and market observable inputs such as credit spreads and discount rates) and to option pricing models (that incorporate market observable inputs including the quoted price, volatility and dividend yield of the underlying security and the risk free rate). The company employs specialist personnel for the valuation of its investment portfolio. Detailed valuations are prepared for those financial instruments that are priced internally, while external pricing received from independent pricing service providers and third party broker-dealers are evaluated by the company for reasonableness. The company’s Chief Financial Officer oversees the valuation function and regularly reviews valuation processes and results, including at each quarterly reporting period. Significant valuation matters, particularly those requiring extensive judgment, are communicated to the company’s Audit Committee. |
Foreign currency translation | Foreign currency translation Functional and presentation currency Foreign currency transactions Translation of foreign subsidiaries |
Hedging | Hedging At the inception of a hedge transaction the company documents the economic relationship between the hedged item and hedging instrument, and its risk management objective and strategy for undertaking the hedge. Net investment hedge |
Comprehensive income (loss) | Comprehensive income (loss) Comprehensive income (loss) consists of net earnings (loss) and other comprehensive income (loss) and includes all changes in total equity during a reporting period, except for those resulting from investments by owners or distributions to owners. Unrealized foreign currency translation amounts arising from the translation of foreign subsidiaries and associates and the effective portion of changes in the fair value of hedging instruments on hedges of net investments in foreign subsidiaries and associates are recognized in other comprehensive income (loss) and included in accumulated other comprehensive income (loss) until recycled to the consolidated statement of earnings on disposal of an investment in a foreign subsidiary or associate. Actuarial gains and losses and changes in asset limitation amounts on defined benefit pension and post retirement plans are recorded in other comprehensive income (loss) and included in accumulated other comprehensive income (loss) without recycling to the consolidated statement of earnings. Upon settlement of the defined benefit plan or disposal of the related subsidiary or associate, those amounts are reclassified directly to retained earnings. Accumulated other comprehensive income (loss), net of income taxes, is included on the consolidated balance sheet as a component of common shareholders’ equity. |
Property and casually insurance contracts | Property and casualty insurance contracts Insurance contracts are those contracts that have significant insurance risk at the inception of the contract. Insurance risk arises when the company agrees to compensate a policyholder if a specified uncertain future event adversely affects the policyholder, with the possibility of paying (including variability in timing of payments) significantly more in a scenario where the insured event occurs than when it does not occur. Contracts not meeting the definition of an insurance contract under IFRS are classified as investment contracts, derivative contracts or service contracts, as appropriate. Revenue recognition Deferred premium acquisition costs Provision for losses and loss adjustment expenses The company’s reserves for reported losses and loss adjustment expenses are based on estimates of future payments to settle reported general insurance and reinsurance claims and claims from its run-off operations. Case reserve estimates are based on the facts available at the time the reserves are established and for reinsurance, based on reports and individual case reserve estimates received from ceding companies. The company establishes these reserves on an undiscounted basis to recognize the estimated costs of bringing pending claims to final settlement, taking into account inflation, as well as other factors that can influence the amount of reserves required, some of which are subjective and some of which are dependent on future events. In determining the level of reserves, the company considers historical trends and patterns of loss payments, pending levels of unpaid claims and types of coverage. In addition, court decisions, economic conditions and public attitudes may affect the ultimate cost of settlement and, as a result, the company’s estimation of reserves. Between the reporting and final settlement of a claim, circumstances may change, which may result in changes to established reserves. Items such as changes in law and interpretations of relevant case law, results of litigation, changes in medical costs, as well as costs of vehicle and building repair materials and labour rates can substantially impact ultimate settlement costs. Accordingly, the company regularly reviews and re-evaluates case reserves. Any resulting adjustments are included in the current period consolidated statement of earnings in losses on claims, gross, and in losses on claims, ceded to reinsurers, as applicable. Amounts ultimately paid for losses and loss adjustment expenses can vary significantly from the level of reserves originally set or currently recorded. The company also establishes reserves for IBNR losses on an undiscounted basis to recognize the estimated final settlement cost for loss events which have already occurred but which have not yet been reported. Historical information and statistical models, based on product line, type and extent of coverage, as well as reported claims trends, severities and frequencies, inflation, exposure changes and other factors are relied upon to estimate IBNR reserves. These estimates are revised as additional information becomes available and as claims are actually reported and paid. Estimation techniques Where possible the company applies several commonly accepted actuarial projection methodologies in estimating required provisions to give greater insight into the trends inherent in the data being projected. These include methods based upon the following: the development of previously settled claims, where payments to date are extrapolated for each prior year; estimates based upon a projection of number of claims and average cost; notified claims development, where notified claims to date for each year are extrapolated based upon observed development of earlier years; and, expected loss ratios. In addition, the company uses other techniques such as aggregate benchmarking methods for specialist classes of business. In selecting its best estimate, the company considers the appropriateness of the methods to the individual circumstances of the line of business and accident or underwriting year. Large claims affecting each relevant line of business are generally assessed separately, being measured either at the face value of the loss adjuster’s estimate or projected separately in order to allow for the future development of large claims. Provisions for losses and loss adjustment expenses are calculated gross of any reinsurance recoveries. A separate estimate is made of the amounts that will be recoverable from reinsurers based upon the gross provisions and with due regard to collectability. The provisions for losses and loss adjustment expenses are subject to review at the subsidiary level by subsidiary actuaries and at the corporate level by the company’s Chief Actuary. In addition, for major classes of business where the risks and uncertainties inherent in the provisions are greatest, ad hoc detailed reviews are undertaken by internal and external actuaries who are able to draw upon their specialist expertise and a broader knowledge of current industry trends in claims development. The results of these reviews are considered when establishing the appropriate levels of provisions for losses and loss adjustment expenses and unexpired risks. |
Life insurance contracts | Life insurance contracts The company, through Eurolife (which was consolidated on July 14, 2021 as described in note 23), writes life, disability, accident, health and critical illness insurance in addition to offering life annuities and insurance related investment products, both on an individual and group basis. Premiums for most life insurance contracts are generally recognized as revenue when due. The provision for policy benefits is calculated in compliance with local regulatory requirements and IFRS using actuarial principles consistent with those applied where life insurance policies are written. The provision for policy benefits is determined based on the discounting of projected future cash flows of claims and premiums using assumptions that include mortality, morbidity, lapse rates, discount rates, investment returns, inflation, and future expenses. These assumptions can vary by contract type and reflect current and expected future experience and represent the best estimates to settle outstanding claims, estimated future benefits and expenses on in-force insurance contracts. Certain insurance contracts written by Eurolife transfer the market risk associated with the underlying investment performance, which supports the benefit payments, to the policyholder (“unit-linked”). For these unit-linked contracts or funds, the company measures the underlying investments at fair value and presents them in other assets on the consolidated balance sheet. A corresponding liability is presented in insurance contract payables on the consolidated balance sheet. A change in the fair value of the investments of the unit-linked funds result in a corresponding change to the related liabilities, with both changes recorded together in the consolidated statement of earnings such that there is no effect on income, expenses or net earnings. |
Reinsurance | Reinsurance Reinsurance does not relieve the originating insurer of its liability and is reflected on the consolidated balance sheet on a gross basis to indicate the extent of credit risk related to reinsurance and the obligations of the insurer to its policyholders. Reinsurance assets include balances due from reinsurance companies for paid and unpaid losses and loss adjustment expenses and ceded unearned premiums. Amounts recoverable from reinsurers are estimated in a manner consistent with the claim liability associated with the reinsured policy. Reinsurance is recorded gross on the consolidated balance sheet unless a legal right to offset against a liability owing to the same reinsurer exists. Ceded premiums and losses are recorded in the consolidated statement of earnings in premiums ceded to reinsurers and losses on claims, ceded to reinsurers respectively and in recoverable from reinsurers on the consolidated balance sheet. Commission income earned on premiums ceded to reinsurers is included in commissions, net, in the consolidated statement of earnings. Unearned premiums are reported on the consolidated balance sheet before reduction for premiums ceded to reinsurers. Reinsurers’ portion of unearned premiums is included in recoverable from reinsurers on the consolidated balance sheet together with estimates of reinsurers’ share of provision for claims determined on a basis consistent with the related claims liabilities. Impairment Risk transfer Premiums |
Income taxes | Income taxes The provision for income taxes for the period comprises current and deferred income tax. Income taxes are recognized in the consolidated statement of earnings, except when related to items recognized in other comprehensive income (loss) or in equity. In those cases, the income taxes are also recognized in other comprehensive income (loss) or in equity, respectively, except for dividends where the income taxes are recognized in earnings, other comprehensive income (loss) or equity according to where the transactions that generated the distributable profits were recognized. Current income tax is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the company’s subsidiaries and associates operate and generate taxable income. Deferred income tax is calculated under the liability method whereby deferred income tax assets and liabilities are recognized for temporary differences between the financial statement carrying amounts of assets and liabilities and their respective income tax bases at current substantively enacted tax rates. With the exception of initial recognition of deferred income tax arising from business combinations, changes in deferred income tax associated with components of other comprehensive income (loss) are recognized in other comprehensive income (loss) while all other changes in deferred income tax are included in the provision for income taxes in the consolidated statement of earnings. Deferred income tax assets are recognized to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilized. Carry forwards of unused losses or unused tax credits are tax effected and recognized as deferred tax assets when it is probable that future taxable profits will be available against which these losses or tax credits can be utilized. Deferred income tax is not recognized on unremitted earnings of subsidiaries where the company has determined it is not probable those earnings will be repatriated in the foreseeable future. Current and deferred income tax assets and liabilities are offset when the income taxes are levied by the same taxation authority and there is a legally enforceable right of offset. |
Investment property | Investment property Investment property consists of real estate held by the company for capital appreciation, rental income, or both, and is initially recorded at cost, including transaction costs, and subsequently measured at fair value. On the consolidated balance sheet investment property is included in portfolio investments by the insurance and reinsurance companies and in other assets by the non-insurance companies. In the consolidated statement of earnings, insurance and reinsurance companies record investment property rental income and direct expenses in interest and dividends, and changes in fair value in net gains (losses) on investments, while non-insurance companies record investment property rental income and changes in fair value in other revenue, and direct expenses in other expenses. |
Other assets | Other assets Other assets primarily consist of premises and equipment, right-of-use assets associated with leases, assets associated with unit-linked insurance products, inventories, sales receivables and finance lease receivables of the non-insurance companies, prepaid expenses, accrued interest and dividends, income taxes refundable, receivables for securities sold, pension assets, prepaid losses on claims, and other miscellaneous receivables. Receivables are initially recognized at fair value less a provision for expected lifetime credit losses, and subsequently measured at amortized cost. Premises and equipment |
Other revenue | Other revenue Other revenue is primarily comprised of revenue earned by the non-insurance companies. Revenue from restaurant and retail sales is recognized when the company provides goods to the customer and receives payment. Revenue from the sale of other goods is typically recognized when shipped to the customer, with payment received in advance of shipment. The shipping and handling performance obligation is recorded as a contract liability and recognized as revenue once the services have been performed. Revenue from providing travel, hospitality and other non-insurance services is recognized over time based on measured progress towards complete satisfaction of the related performance obligations. Payment is usually received at the time of initial booking for travel and hospitality services, and received in installments for other services. Unconditional payments due from customers for satisfied performance obligations are recorded as sales receivables within other assets on the consolidated balance sheet. Customer prepayments are recorded as deferred revenue within accounts payable and accrued liabilities on the consolidated balance sheet and are not recognized as revenue until the shipment of goods or provision of services occurs. Certain contracts include multiple deliverables which are accounted for as separate performance obligations, with the transaction price allocated to the performance obligations based on their individual selling prices. |
Other expenses | Other expenses Other expenses is primarily comprised of the cost of inventories sold or services provided and the operating expenses of the non-insurance companies. |
Accounts payable and accrued liabilities | Accounts payable and accrued liabilities Accounts payable and accrued liabilities primarily consist of leases liabilities, trade payables of the non-insurance companies, accrued amounts for salaries and employee benefits, deferred revenue of the non-insurance companies, pension and post retirement liabilities, amounts withheld and accrued taxes, income taxes payable, and other administrative costs. Accounts payable and accrued liabilities are initially recognized at fair value and subsequently measured at amortized cost. |
Borrowings | Borrowings Borrowings are initially recognized at fair value, net of incremental and directly attributable transaction costs, and subsequently measured at amortized cost. Interest expense on borrowings is recognized in the consolidated statement of earnings using the effective interest rate method. Borrowings are derecognized when extinguished, with any gain or loss on extinguishment or modification recognized in interest expense in the consolidated statement of earnings. |
Equity | Equity Common stock issued by the company is classified as equity when there is no contractual obligation to transfer cash or other financial assets to the holder of the shares. Incremental costs directly attributable to the issue or repurchase of equity instruments are recognized in equity, net of tax. Treasury shares are equity instruments repurchased by the company which have not been canceled and are deducted from equity on the consolidated balance sheet, irrespective of the objective of the purchase. The company acquires its own subordinate voting shares on the open market for its share-based payment awards. No gain or loss is recognized in the consolidated statement of earnings on the purchase, sale, issue or cancellation of treasury shares. Consideration paid or received is recognized directly in equity. Dividends and other distributions to holders of the company’s equity instruments are recognized directly in equity. |
Share-based payments | Share-based payments The company has restricted share plans or equivalent for management of the holding company and its subsidiaries with vesting periods of up to fifteen years from the date of grant. The fair value of restricted share awards on the grant date is amortized to compensation expense over the vesting period, with a corresponding increase in the share-based payments equity reserve. At each balance sheet date, the company reviews its estimates of the number of restricted share awards expected to vest. |
Net earnings per share attributable to shareholders of Fairfax | Net earnings per share attributable to shareholders of Fairfax Net earnings (loss) per share Net earnings (loss) per diluted share |
Pensions and post retirement benefits | Pensions and post retirement benefits The company’s subsidiaries have a number of arrangements in Canada, the United States, the United Kingdom and certain other jurisdictions that provide pension and post retirement benefits to retired and current employees. The holding company has no such arrangements or plans. Pension arrangements of the subsidiaries include defined benefit statutory pension plans and supplemental arrangements that provide pension benefits in excess of statutory limits. These plans are a combination of defined benefit plans and defined contribution plans. The assets of these plans are held separately from the company’s general assets in separate pension funds and invested principally in equities, high quality fixed income securities and cash and short term investments. Certain of the company’s post retirement benefit plans covering medical care and life insurance are internally funded. Defined contribution plan Defined benefit plan Defined benefit obligations, net of the fair value of plan assets, and adjusted for pension asset limitations, if any, are accrued on the consolidated balance sheet in accounts payable and accrued liabilities (note 14). Plans in a net asset position, subject to any minimum funding requirements, are recognized in other assets (note 13). Defined benefit expense recognized in the consolidated statement of earnings includes the net interest on the net defined benefit liability (asset) calculated using a discount rate based on market yields on high quality bonds, past service costs arising from plan amendments or curtailments and gains or losses on plan settlements. Remeasurements, consisting of actuarial gains and losses on plan liabilities, the actual return on plan assets (excluding the net interest component) and any change in asset limitation amounts, are recognized in other comprehensive income (loss) and subsequently included in accumulated other comprehensive income (loss). Remeasurements are not recycled to the consolidated statement of earnings and are reclassified to retained earnings upon settlement of the plan or disposal of the related subsidiary. |
Leases | Leases Lessees A right-of-use asset and a lease liability are recognized at the commencement date of a lease. Right-of-use assets are initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made before the commencement date, and any initial direct costs incurred. Lease liabilities are initially measured at the present value of lease payments, discounted using the interest rate implicit in the lease, or if that rate cannot be readily determined, the company’s incremental borrowing rate. The company typically uses its incremental borrowing rate. Right-of-use assets are included in other assets and lease liabilities are included in accounts payable and accrued liabilities on the consolidated balance sheet. Subsequent to initial recognition, right-of-use assets are depreciated using the straight-line method over the shorter of the lease term and the right-of-use asset’s useful life, with depreciation expense recorded as operating expenses or other expenses in the consolidated statement of earnings, and lease liabilities are measured at amortized cost using the effective interest method, with accretion of lease liabilities recorded as interest expense in the consolidated statement of earnings. Each lease payment is allocated between principal and interest expense to produce a constant periodic rate of interest on the remaining balance of the lease liability. The interest and principal portions of cash payments on lease liabilities are reported as operating activities and financing activities respectively in the consolidated statement of cash flows. Right-of-use assets and lease liabilities are not recognized for short-term leases that have a lease term of twelve months or less, or for low value leases, which principally relate to office equipment, furniture and fixtures. Payments for short-term and low value leases are recorded on a straight-line basis over the lease term in the consolidated statement of earnings and reported as operating activities in the consolidated statement of cash flows. Lessors Classification of a sub-lease is determined with reference to the right-of-use asset arising from the head lease, and not with reference to the underlying leased asset. If substantially all of the risk and rewards of ownership of the right-of-use asset are transferred, then the sub-lease is classified as a finance lease, where the right-of-use asset is derecognized, a finance lease receivable is recorded, representing the present value of future lease payments to be received, and any difference is recorded in the consolidated statement of earnings. Finance lease receivables are included in other assets on the consolidated balance sheet. Interest revenue earned on finance lease receivables is included in other revenue in the consolidated statement of earnings. Sub-leases classified as operating leases do not result in any change to the amounts initially recognized on the head lease. Payments received from operating leases are recorded on a straight-line basis over the lease term as other revenue in the consolidated statement of earnings. |
New accounting pronouncements adopted in 2022 | New accounting pronouncements adopted in 2022 Onerous Contracts — Cost of Fulfilling a Contract (Amendments to IAS 37) The amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets Reference to the Conceptual Framework (Amendments to IFRS 3) The amendments to IFRS 3 Business Combinations Framework for the Preparation and Presentation of Financial Statements Conceptual Framework for Financial Reporting Provisions, Contingent Liabilities and Contingent Assets Levies Annual Improvements to IFRS Standards 2018 – 2020 Amendments to certain IFRS Standards as a result of the IASB’s annual improvements project included an amendment to IFRS 9 Financial Instruments |
New accounting pronouncements issued but not yet effective | New accounting pronouncements issued but not yet effective The following new standards and amendments have been issued by the IASB and were not yet effective for the fiscal year beginning January 1, 2022. The company does not expect to adopt them in advance of their effective dates. IFRS 17 Insurance Contracts (“IFRS 17”) On May 18, 2017 the IASB issued IFRS 17, a comprehensive standard for the recognition, measurement, presentation and disclosure of insurance contracts with amendments issued on June 25, 2020 that included targeted improvements and the deferral of the effective date to January 1, 2023. IFRS 17 requires entities to measure insurance contracts using current estimates of fulfillment cash flows, which includes all future cash flows associated with insurance contracts, using one of three measurement models. The company has assessed that the majority of its insurance contracts will be eligible for the simplified measurement model, the Premium Allocation Approach, with the remainder of the company’s insurance contracts primarily using the General Measurement Model. The measurement of insurance contracts under the Premium Allocation Approach is similar to that under IFRS 4 and is available for contracts with a coverage period of one year or less, or where the measurement of the liability for remaining coverage is not expected to differ materially had the General Measurement Model been applied. Under IFRS 17, the carrying amount of a group of insurance contracts at each reporting date is measured as the sum of the liability for remaining coverage, comprised principally of unearned premium and deferred premium acquisition costs under IFRS 4, and the liability for incurred claims, comprised principally of future cash flows and a risk adjustment for non-financial risks of losses on claims and expenses that have been incurred but not yet paid. The measurement of insurance contracts under IFRS 17 introduces new requirements, the most notable being that the measurement reflect both the time value of money and an explicit risk adjustment for non-financial risk, whereas the company’s current measurement under IFRS 4 reflects neither. IFRS 17 must be applied retrospectively with restatement of comparatives unless impracticable. IFRS 17 will bring considerable changes to the recognition, measurement, presentation and disclosure of insurance contracts within the company’s consolidated financial statements. It will not, however, affect the company’s underwriting strategy, its actuarial practice to establish management’s best estimate of the reserves, or the company’s cash flows. Insurance contracts will be presented differently, including differentiating in the consolidated statement of earnings between the insurance service result, which includes insurance revenue and insurance service expenses, and insurance finance income or expenses, which includes the effects of discounting and changes in discount rates. In 2022, the company finalized the implementation and testing of information technology systems across its insurance and reinsurance subsidiaries and completed its analysis and documentation of key accounting policy decisions. Additionally, the company has prepared and continues to refine its draft IFRS 17 opening balance sheet as at January 1, 2022 and continues the preparation of its comparative quarterly information. The company determined that it will apply IFRS 17 to the majority of its insurance contracts on a full retrospective basis, and on a modified retrospective basis where a full retrospective basis is impracticable, which is primarily for insurance contracts acquired in past business combinations. When applying the modified retrospective approach, simplifications and modifications will be used only to the extent required, as permitted by the standard. Upon adoption of IFRS 17, the company anticipates recording a transition adjustment to increase opening common shareholders’ equity as at January 1, 2022 which is not expected to exceed 2.5% of common shareholders’ equity as at December 31, 2021, primarily reflecting a decrease to insurance contract liabilities from the introduction of discounting claims reserves and the deferral of additional insurance acquisition costs which were previously expensed as incurred (as a result of IFRS 17’s broader definition of insurance acquisition costs compared with the company’s current policy under IFRS 4), partially offset by a new risk adjustment for uncertainty related to the timing and amount of cash flows arising from non-financial risks. The company does not anticipate material changes to the measurement of net revenue (currently presented as net premiums earned in the consolidated statement of earnings and will be presented differently under IFRS 17) or the selection of actuarial projection methodologies and the development of significant assumptions to determine management’s best estimate of reserves on adoption of IFRS 17. Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12) On May 7, 2021 the IASB issued amendments to IAS 12 Income Taxes Leases Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2) On February 12, 2021 the IASB issued amendments to IAS 1 Presentation of Financial Statements Making Materiality Judgements Definition of Accounting Estimates (Amendments to IAS 8) On February 12, 2021 the IASB issued amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors Classification of Liabilities as Current or Non-current (Amendments to IAS 1) On January 23, 2020 the IASB issued amendments to IAS 1 to clarify the criteria for classifying a liability as non-current. The amendments were to be applied retrospectively to annual periods beginning on or after January 1, 2023, however on October 31, 2022 the IASB deferred the effective date by one year to January 1, 2024. The company is currently evaluating the expected impact of the amendments on its consolidated financial statements. Non-current Liabilities with Covenants (Amendments to IAS 1) On October 31, 2022 the IASB issued amendments to IAS 1 Presentation of Financial Statements Lease Liability in a Sale and Leaseback (Amendments to IFRS 16) On September 22, 2022 the IASB issued amendments to IFRS 16 Leases Revenue from Contracts with Customers |
Comparatives | Comparatives On April 1, 2022 the company revised its property and casualty insurance and reinsurance reporting segments as described in note 25. Certain prior period comparatives have been reclassified to conform with the current period’s reporting segments presentation. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Schedule of estimated useful lives of intangible assets | Customer and broker relationships 8 to 20 years Brand names and Lloyd’s participation rights Indefinite Computer software 3 to 15 years |
Cash and Investments (Tables)
Cash and Investments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Cash and Investments | |
Schedule of cash and investments | Presented in the table below are holding company cash and investments and portfolio investments, net of derivative obligations, all of which are classified at FVTPL except for investments in associates and other invested assets. December 31, December 31, 2022 2021 Holding company Cash and cash equivalents 552.1 465.9 Short term investments 126.6 216.9 Bonds 243.2 242.6 Preferred stocks 11.1 14.0 Common stocks (1) 75.4 137.5 Derivatives (note 7) 232.8 290.5 1,241.2 1,367.4 Assets pledged for derivative obligations: Cash equivalents 40.6 46.8 Short term investments 64.0 64.1 104.6 110.9 Holding company cash and investments as presented on the consolidated balance sheet 1,345.8 1,478.3 Derivative obligations (note 7) (19.4) (32.1) 1,326.4 1,446.2 Portfolio investments Cash and cash equivalents (2) 6,203.3 12,283.2 Short term investments 3,164.9 9,516.3 Bonds 28,578.5 14,091.2 Preferred stocks 2,338.0 2,405.9 Common stocks (1) 5,124.3 5,468.9 Investments in associates (note 6) 6,091.3 4,755.1 Derivatives (note 7) 235.0 291.3 Other invested assets (3) 593.5 699.9 52,328.8 49,511.8 Assets pledged for derivative obligations: Cash equivalents — 74.0 Short term investments — 45.6 Bonds 51.3 — 51.3 119.6 Fairfax India cash, portfolio investments and associates: Cash and cash equivalents (2) 184.8 76.5 Short term investments 49.7 6.2 Bonds 128.2 199.8 Common stocks 237.5 434.6 Investments in associates (note 6) 1,342.6 1,348.9 1,942.8 2,066.0 Portfolio investments as presented on the consolidated balance sheet 54,322.9 51,697.4 Derivative obligations (note 7) (171.6) (120.8) 54,151.3 51,576.6 Total cash and investments, net of derivative obligations 55,477.7 53,022.8 (1) Includes aggregate investments in limited partnerships with a carrying value at December 31, 2022 of $1,982.5 (December 31, 2021 – $1,971.0 ). (2) Includes aggregate restricted cash and cash equivalents at December 31, 2022 of $861.2 (December 31, 2021 – $1,261.0 ). See note 27. (3) Comprised primarily of investment property. |
Schedule of pledged assets, by nature of pledge requirement | The table that follows summarizes assets pledged to third parties by the nature of the pledge requirement (excluding assets pledged in favour of Lloyd’s (note 20), for derivative obligations and for certain intercompany reinsurance arrangements). Pledged assets primarily consist of cash and cash equivalents, short term investments and bonds within portfolio investments on the consolidated balance sheet. December 31, December 31, 2022 2021 Regulatory deposits 5,724.2 5,147.1 Security for reinsurance and other 1,611.0 1,434.9 7,335.2 6,582.0 |
Schedule of fixed income maturity profile | December 31, 2022 December 31, 2021 Amortized Fair Amortized Fair cost (1) value (1) cost (1) value (1) Due in 1 year or less (2) 8,506.5 8,192.5 6,022.8 5,946.5 Due after 1 year through 3 years (2) 16,077.6 15,686.2 3,933.5 4,206.0 Due after 3 years through 5 years 4,205.8 4,116.6 2,740.7 2,744.1 Due after 5 years through 10 years 318.8 291.1 534.0 531.3 Due after 10 years 859.9 714.8 990.1 1,105.7 29,968.6 29,001.2 14,221.1 14,533.6 Pre-tax effective interest rate 3.6 % 2.7 % (1) Includes bonds held by the holding company and Fairfax India. (2) Includes the company’s investments in first mortgage loans at December 31, 2022 of $2,500.7 (December 31, 2021 - $1,659.4 ) secured by real estate predominantly in the U.S., Europe and Canada. |
Schedule of fair value hierarchy of assets and liabilities | The company’s use of quoted market prices (Level 1), valuation models with significant observable market information as inputs (Level 2) and valuation models with significant unobservable information as inputs (Level 3) in the valuation of securities and derivative contracts by type of issuer was as follows: December 31, 2022 December 31, 2021 Significant Significant other Significant other Significant Quoted observable unobservable Total fair Quoted observable unobservable Total fair prices inputs inputs value asset prices inputs inputs value asset (Level 1) (Level 2) (Level 3) (liability) (Level 1) (Level 2) (Level 3) (liability) Cash and cash equivalents (1) 6,980.8 — — 6,980.8 12,946.4 — — 12,946.4 Short term investments: Canadian government 91.8 — — 91.8 16.2 — — 16.2 Canadian provincials 38.1 — — 38.1 535.8 — — 535.8 U.S. treasury 1,574.5 — — 1,574.5 7,608.8 — — 7,608.8 Other government 164.3 1,238.5 — 1,402.8 283.5 1,140.9 — 1,424.4 Corporate and other — 298.0 — 298.0 — 263.9 — 263.9 1,868.7 1,536.5 — 3,405.2 8,444.3 1,404.8 — 9,849.1 Bonds: Canadian government — 1,923.5 — 1,923.5 — 614.6 — 614.6 Canadian provincials — 284.1 — 284.1 — 45.0 — 45.0 U.S. treasury — 14,378.8 — 14,378.8 — 3,957.9 — 3,957.9 U.S. states and municipalities — 262.7 — 262.7 — 387.2 — 387.2 Other government — 2,700.2 — 2,700.2 — 2,655.0 — 2,655.0 Corporate and other (2) — 5,986.6 3,465.3 9,451.9 — 4,078.1 2,795.8 6,873.9 — 25,535.9 3,465.3 29,001.2 — 11,737.8 2,795.8 14,533.6 Preferred stocks: Canadian 10.4 9.2 13.2 32.8 — 16.6 93.6 110.2 U.S. — — 233.6 233.6 — — 40.6 40.6 Other (3) 13.2 269.2 1,800.3 2,082.7 13.5 288.0 1,967.6 2,269.1 23.6 278.4 2,047.1 2,349.1 13.5 304.6 2,101.8 2,419.9 Common stocks: Canadian 624.3 192.3 427.8 1,244.4 1,104.2 188.4 303.7 1,596.3 U.S. 691.0 26.1 1,087.2 1,804.3 597.9 32.0 1,155.3 1,785.2 Other 1,097.8 254.1 1,036.6 2,388.5 1,438.0 276.7 944.8 2,659.5 2,413.1 472.5 2,551.6 5,437.2 3,140.1 497.1 2,403.8 6,041.0 Derivatives and other invested assets — 341.8 719.5 1,061.3 0.1 175.4 1,106.2 1,281.7 Derivative obligations (note 7) — (151.8) (39.2) (191.0) — (88.5) (64.4) (152.9) Holding company cash and investments and portfolio investments measured at fair value 11,286.2 28,013.3 8,744.3 48,043.8 24,544.4 14,031.2 8,343.2 46,918.8 23.5 % 58.3 % 18.2 % 100.0 % 52.3 % 29.9 % 17.8 % 100.0 % Investments in associates (note 6) (4) 4,693.8 95.3 4,463.2 9,252.3 4,188.8 106.8 3,995.6 8,291.2 (1) Includes restricted cash and cash equivalents of $861.2 at December 31, 2022 (December 31, 2021 – $1,261.0 ). See note 27. (2) Included in Level 3 are the company’s investments in first mortgage loans at December 31, 2022 of $2,500.7 (December 31, 2021 – $1,659.4 ) secured by real estate predominantly in the U.S., Europe and Canada. (3) Primarily comprised of the company’s investment in compulsory convertible preferred shares of Go Digit Infoworks Services Limited (“Digit”),which is described in footnote (2) of the following table. The company also holds a 49.0% equity interest in Digit as described in note 6. (4) The fair value of investments in associates is presented separately as such investments are measured using the equity method of accounting. Also included is the fair value of Resolute Forest Products which was held for sale at December 31, 2022 as described in note 6. |
Summary of changes in Level 3 financial assets measured at fair value on a recurring basis | 2022 Private Private Derivatives placement company Limited Private and other debt preferred partnerships equity Common invested securities shares and other (1) funds (1) shares assets Total Balance - January 1 2,795.8 2,101.8 1,789.1 107.7 507.0 1,041.8 8,343.2 Net realized and unrealized gains (losses) included in the consolidated statement of earnings (2) (378.8) (247.4) 143.0 (1.4) 61.9 (95.8) (518.5) Purchases (3) 1,456.0 286.4 113.1 — 102.7 67.4 2,025.6 Sales and distributions (3) (382.4) (88.1) (207.0) (4.2) (14.3) (303.8) (999.8) Transfer out of category — — — — (2.7) — (2.7) Unrealized foreign currency translation losses on foreign subsidiaries included in other comprehensive income (loss) (25.3) (5.6) (14.0) (4.6) (24.7) (29.3) (103.5) Balance - December 31 3,465.3 2,047.1 1,824.2 97.5 629.9 680.3 8,744.3 2021 Private Private Derivatives placement company Limited Private and other debt preferred partnerships equity Common invested securities shares and other (1) funds (1) shares assets Total Balance - January 1 1,774.2 587.4 1,766.9 110.8 239.9 697.6 5,176.8 Net realized and unrealized gains included in the consolidated statement of earnings (2) 69.1 1,489.3 450.6 2.4 53.7 297.4 2,362.5 Purchases (3)(4)(5) 1,241.5 32.0 254.3 — 216.9 115.5 1,860.2 Acquisitions of subsidiaries (note 23) 47.5 — — — — 27.4 74.9 Transfer into category (6) 139.6 — — — 10.9 — 150.5 Sales and distributions (3) (476.6) (7.2) (580.9) (5.9) (2.5) (91.8) (1,164.9) Transfer out of category — — (102.0) — (10.7) — (112.7) Unrealized foreign currency translation gains (losses) on foreign subsidiaries included in other comprehensive income (loss) 0.5 0.3 0.2 0.4 (1.2) (4.3) (4.1) Balance - December 31 2,795.8 2,101.8 1,789.1 107.7 507.0 1,041.8 8,343.2 (1) Included in common stocks in the fair value hierarchy table presented on the previous page and in holding company cash and investments or common stocks on the consolidated balance sheets. (2) During June 2021, the company’s associate Go Digit Infoworks Services Private Limited (“Digit”) entered into agreements with certain third party investors for its general insurance subsidiary Go Digit Insurance Limited (“Digit Insurance”) to raise approximately $200 ( 14.9 billion Indian rupees) of new equity shares, valuing Digit Insurance at approximately $3.5 billion ( 259.5 billion Indian rupees) (the “transaction fair value”). Digit Insurance subsequently closed the majority of the $200 raise in the fourth quarter of 2021 and first half of 2022. At December 31, 2021, the company estimated the fair value of Digit Insurance using the transaction fair value, which was supported by an internal discounted cash flow analysis, resulting in the company recording a net unrealized gain of $1,490.3 in 2021 (inclusive of foreign exchange losses) on its investment in Digit compulsory convertible preferred shares. At December 31, 2022, the company estimated the fair value of Digit Insurance using an internal discounted cash flow analysis that continues to approximate the transaction fair value, resulting in the company recording a net unrealized loss of $167.2 in 2022, principally related to foreign exchange losses on its investment in Digit compulsory convertible preferred shares. The company also holds a 49.0% equity accounted interest in Digit as described in note 6. (3) Private placement debt securities include net purchases of first mortgage loans of $870.2 (2021 - $826.9 ). (4) Common shares include non-voting shares of the RiverStone Barbados holding company as described in note 23. (5) Derivatives and other invested assets include a monthly royalty on future revenues of Toys “R” Us Canada as described in note 23. (6) Private placement debt securities include Mosaic Capital 25-year debentures as described in note 23. |
Disclosure of significant unobservable inputs used in fair value measurement of assets | The table below presents the valuation techniques and unobservable inputs used to estimate fair values for the company’s significant Level 3 financial assets at December 31, 2022: Effect on fair value if input Carrying Input range used value is Asset class value Valuation technique Significant unobservable input Low High increased (a) Bonds (b) Private placement debt securities (1) 834.2 Discounted cash flow Credit spread 2.8 % 12.7 % Decrease Mortgage loans (2) 2,500.7 Market approach Recent transaction price N/A N/A Increase Discounted cash flow Credit spread 2.1 % 6.4 % Decrease Other 130.4 Various Various N/A N/A N/A 3,465.3 Preferred stocks (c) Private company preferred shares (3) 1,798.3 Discounted cash flow Discount rate 10.9 % 10.9 % Decrease Long term growth rate 6.3 % 6.3 % Increase Private placement preferred shares 156.7 Discounted cash flow Credit spread 5.8 % 5.8 % Decrease Other 92.1 Various Various N/A N/A N/A 2,047.1 Common stocks (d) Limited partnerships and other (4) 1,824.2 Net asset value Net asset value N/A N/A Increase Common shares 261.6 Market approach Recent transaction price N/A N/A Increase Other 465.8 Various Various N/A N/A N/A 2,551.6 Derivatives and other invested assets (e) Investment property (5) 437.3 Income capitalization Terminal capitalization rate 6.0 % 8.0 % Decrease Discount rate 6.9 % 9.3 % Decrease Market rent growth rate 2.6 % 3.0 % Increase 66.0 Sales comparison Price per acre (Cdn$ thousands) 30.0 150.0 Increase Other 177.0 Various Various N/A N/A N/A 680.3 Total 8,744.3 (a) Decreasing the input value would have the opposite effect on the estimated fair value. (b) Included in holding company cash and investments or bonds on the consolidated balance sheet. (c) Included in preferred stocks on the consolidated balance sheet. (d) Included in holding company cash and investments or common stocks on the consolidated balance sheet. (e) Included in holding company cash and investments or derivatives and other invested assets, net of derivative obligations, on the consolidated balance sheet. (1) At December 31, 2022 these private placement debt securities were valued using industry accepted discounted cash flow models that incorporated unobservable credit spreads of the issuers, and consisted of 10 investments, the largest being $285.0 (software and services) (December 31, 2021 - 12 investments, the largest being $535.1 (software and services)). By increasing (decreasing) the credit spreads applied at December 31, 2022 by 100 basis points, the fair value of this asset class would collectively decrease by $23.2 (increase by $24.5 ). (2) At December 31, 2022 these mortgage loans consisted of 50 investments, the largest being $250.0 (December 31, 2021 – 36 investments, the largest being $149.4 ). By increasing (decreasing) the credit spreads applied at December 31, 2022 by 100 basis points, the fair value of this asset class would not change significantly primarily due to the short term nature of these instruments. (3) These private company preferred shares relate to the company’s investment in Digit compulsory convertible preferred shares which were valued using an industry accepted discounted cash flow model that incorporated an unobservable discount rate and long term growth rate. By increasing (decreasing) the discount rate applied at December 31, 2022 by 1.0% , the fair value of the preferred shares would decrease by $308.2 (increase by $591.8 ); by increasing (decreasing) the long term growth rate applied at December 31, 2022 by 0.5% , the fair value of the preferred shares would increase by $175.8 (decrease by $141.7 ). (4) Limited partnerships and other are investment funds managed by third party fund managers and general partners that invest in a diverse range of industries and geographies. These investment funds were valued primarily using net asset value statements provided by those third party fund managers and general partners. The fair values in those statements are determined using quoted prices of the underlying assets, and to a lesser extent, observable inputs where available and unobservable inputs, in conjunction with industry accepted valuation models, where required. In some instances, such investments are classified as Level 3 if they require at least three months’ notice to liquidate or redeem. At December 31, 2022 limited partnerships and other consisted of 45 investments, the three largest being $374.8 (oil and gas extraction), $189.5 (industrials) and $176.1 (industrials) (December 31, 2021 - 47 investments, the three largest being $258.2 (industrials), $252.1 (oil and gas extraction) and $192.0 (primarily household appliance manufacturing)). By increasing (decreasing) net asset values at December 31, 2022 by 10% , the fair value of limited partnerships and other would collectively increase (decrease) by $182.4 . (5) These investment property were primarily valued by third party appraisers using an industry accepted income capitalization approach that incorporated unobservable capitalization rates, discount rates and market rent growth rates. Certain investment property were valued using an industry accepted direct sales comparison approach that incorporated unobservable recent sale prices per acre for comparable properties in similar locations. |
Disclosure of investment income | An analysis of investment income for the years ended December 31 follows: Interest and dividends and share of profit of associates 2022 2021 Interest income: Cash and short term investments 101.5 26.8 Bonds 753.1 488.5 Derivatives and other invested assets 18.9 53.1 873.5 568.4 Dividends: Preferred stocks 39.7 14.1 Common stocks 100.7 94.1 140.4 108.2 Investment expenses (52.1) (35.8) Interest and dividends 961.8 640.8 Share of profit of associates (note 6) 1,014.7 402.0 |
Schedule of gains (losses) on investment | Net gains (losses) on investments 2022 2021 Net change in Net gains Net change in Net gains Net realized unrealized (losses) on Net realized unrealized (losses) on gains (losses) gains (losses) investments gains (losses) gains (losses) investments Common stocks 364.5 (1) (607.2) (1) (242.7) 483.4 850.0 1,333.4 Preferred stocks - convertible 1.4 (5.8) (4.4) 0.7 2.1 2.8 Bonds - convertible 10.2 (247.2) (237.0) 0.2 101.1 101.3 Other equity derivatives (2)(3) 331.7 (4) (140.9) (4) 190.8 461.5 170.1 631.6 Disposition of non-insurance associates 45.1 — 45.1 52.7 (5) — 52.7 Deconsolidation of non-insurance subsidiaries 4.4 — 4.4 190.3 (6) — 190.3 Long equity exposures and financial effects 757.3 (1,001.1) (243.8) 1,188.8 1,123.3 2,312.1 Bonds (183.6) (1,064.9) (1,248.5) 338.0 (7) (624.6) (7) (286.6) U.S. treasury bond forward contracts 163.0 (0.6) 162.4 26.0 (0.3) 25.7 Total bonds (20.6) (1,065.5) (1,086.1) 364.0 (624.9) (260.9) Preferred stocks 12.9 (101.1) (88.2) 1.5 1,507.4 (8) 1,508.9 Other derivative contracts (62.0) 86.6 24.6 (157.2) 181.3 24.1 Foreign currency (9) 105.8 (410.1) (304.3) (64.5) (28.6) (93.1) Other (36.3) 0.2 (36.1) 130.4 (176.4) (46.0) Net gains (losses) on investments 757.1 (2,491.0) (1,733.9) 1,463.0 1,982.1 3,445.1 (1) On August 31, 2022 Stelco. repurchased 5.1 million of its outstanding common shares under its substantial issuer bid which resulted in the loss of a certain right held by another investor and the company’s ownership interest in Stelco increasing to 20.5% . Accordingly, the company commenced applying the equity method of accounting to its interest in Stelco at that date, resulting in unrealized gains of $151.9 being reclassified to realized with a net impact of nil in the consolidated statement of earnings, as described in note 6. (2) Other equity derivatives include long equity total return swaps, equity warrants and options and the Asset Value Loan Notes (“AVLNs”) entered with RiverStone Barbados as described in note 23. Net change in unrealized gains (losses) in 2022 included $100.6 in unrealized gains (2021 - $91.8 ) on the company’s investment in long equity total return swaps on Fairfax subordinate voting shares, with the fair value of $196.3 at December 31, 2022 (December 31, 2021 - $95.7 ) recorded in holding company cash and investments, as described in note 7. (3) Amounts recorded in net realized gains (losses) include net gains (losses) on total return swaps where the counterparties are generally required to cash-settle monthly or quarterly the market value movement since the previous reset date notwithstanding that the total return swap positions remain open subsequent to the cash settlement. Net realized gains (losses) in 2022 included $154.8 in realized gains (2021 - $130.9 ) on the company’s investment in long equity total return swaps on Fairfax subordinate voting shares, which represented cash-settlement amounts recorded in holding company cash and investments. (4) On April 6, 2022 the company acquired 25.0 million Atlas common shares by exercising its Atlas equity warrants with a strike price of $8.05 per share for aggregate cash consideration of $201.3 and recognized a net loss on investment of $37.2 (realized gains of $58.6 , of which $95.8 was recorded as unrealized gains in prior years) on derecognition of the equity warrants as described in note 6. (5) During 2021 the company sold a portion of its investment in IIFL Finance for cash proceeds of $113.7 ( 8.6 billion Indian rupees) and recorded a net realized gain of $42.0 in the consolidated statement of earnings as described in note 6. (6) Principally comprised of the sale of Toys “R” Us Canada and Fairfax India’s sale of Privi during 2021. (7) Includes the derecognition of Seaspan Corporation debentures that were exchanged for Atlas Corp. preferred shares and Seaspan Corporation debentures that were redeemed as described in note 6. (8) Includes net unrealized gains of $1,490.3 (inclusive of foreign exchange losses) on Digit compulsory convertible preferred shares during 2021 described earlier in this note. (9) Foreign currency net losses on investing activities during 2022 primarily related to the strengthening of the U.S. dollar relative to the company’s investments denominated in the Indian rupee, Canadian dollar, Egyptian pound, Sri Lankan rupee and British pound, partially offset by foreign currency net gains on U.S. dollar denominated investments held by subsidiaries with a Canadian dollar or British pound functional currency as the U.S. dollar strengthened relative to those currencies. Foreign currency net losses on investing activities during 2021 primarily related to euro and Indian rupee denominated investments held by subsidiaries with a U.S. dollar functional currency as the U.S. dollar strengthened relative to those currencies. |
Investments in Associates (Tabl
Investments in Associates (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Investments in Associates | |
Schedule of investments in associates | December 31, 2022 Year ended December 31, Carrying value 2022 Associates Share of Ownership Fair and joint Fairfax India profit percentage (a) value (b) ventures associates (c) Total (loss) Insurance and reinsurance: Gulf Insurance Group K.S.C.P. (“Gulf Insurance”) 43.7 % 415.8 403.4 — 403.4 53.0 Go Digit Infoworks Services Private Limited (“Digit”) (1) 49.0 % 479.3 104.4 — 104.4 (11.0) Other — 173.9 139.5 — 139.5 (11.6) 1,069.0 647.3 — 647.3 30.4 Non-insurance: India Bangalore International Airport Limited (“Bangalore Airport”) 54.0 % 1,233.7 — 521.1 521.1 (5.7) Quess Corp Limited (“Quess”) 30.9 % 228.3 459.6 (d) — 459.6 6.8 IIFL Finance Limited (“IIFL Finance”) 22.3 % 493.3 — 242.8 242.8 36.5 Sanmar Chemicals Group (“Sanmar”) 42.9 % 337.8 — 159.8 159.8 36.4 CSB Bank Limited (“CSB Bank”) 49.7 % 223.3 — 194.5 194.5 40.8 IIFL Securities Limited (“IIFL Securities”) 37.1 % 87.9 35.3 97.9 133.2 14.6 Seven Islands Shipping Limited (“Seven Islands”) 48.5 % 96.9 — 97.9 97.9 9.8 Other — 38.0 10.8 28.6 39.4 3.3 2,739.2 505.7 1,342.6 1,848.3 142.5 Real estate KWF Real Estate Ventures Limited Partnerships (“KWF LPs”) — 101.1 101.1 (d) — 101.1 16.5 Other (6) — 61.3 63.3 — 63.3 2.8 162.4 164.4 — 164.4 19.3 Other Eurobank Ergasias Services & Holdings S.A (“Eurobank”) 32.2 % 1,344.5 1,507.6 — 1,507.6 263.0 Atlas Corp. (“Atlas”, formerly Seaspan Corporation) (7) 43.2 % 1,864.7 1,506.3 — 1,506.3 258.2 Resolute Forest Products Inc. (“Resolute”) (8) 32.2 % 508.5 508.5 — 508.5 159.0 Stelco Holdings Inc. (“Stelco”) (9) 23.6 % 423.3 304.8 — 304.8 — EXCO Resources Inc. (“EXCO”) 44.4 % 544.8 288.4 — 288.4 81.9 Helios Fairfax Partners Corporation (“HFP”) 34.4 % 104.1 183.2 — 183.2 (23.9) Peak Achievement Athletics (“Peak Achievement”) 42.6 % 195.3 124.4 (d) — 124.4 7.7 Partnerships, trusts and other — 296.5 350.7 — 350.7 76.6 5,281.7 4,773.9 — 4,773.9 822.5 8,183.3 5,444.0 1,342.6 6,786.6 984.3 Investments in associates 9,252.3 6,091.3 1,342.6 7,433.9 1,014.7 As presented on the consolidated balance sheet: Investments in associates 6,772.9 6,091.3 Fairfax India investments in associates 2,479.4 1,342.6 9,252.3 7,433.9 Year ended December 31, 2021 December 31, Carrying value 2021 Associates Share of Ownership Fair and joint Fairfax India profit percentage (a) value (b) ventures associates (c) Total (loss) Insurance and reinsurance: Gulf Insurance Group K.S.C.P. (“Gulf Insurance”) (2) 43.7 % 409.5 380.0 — 380.0 55.5 Go Digit Infoworks Services Private Limited (“Digit”) 49.0 % 498.3 79.1 — 79.1 5.3 Other (3)(4)(5) — 191.3 148.3 — 148.3 11.8 1,099.1 607.4 — 607.4 72.6 Non-insurance: India Bangalore International Airport Limited (“Bangalore Airport”) (13) 54.0 % 1,372.2 — 585.8 585.8 (45.8) Quess Corp Limited (“Quess”) 31.0 % 528.5 506.3 (d) — 506.3 (1.4) IIFL Finance Limited (“IIFL Finance”) (10) 22.3 % 318.1 — 198.8 198.8 40.6 Sanmar Chemicals Group (“Sanmar”) 42.9 % 421.2 — 124.2 124.2 (2.4) CSB Bank Limited (“CSB Bank”) 49.7 % 227.6 — 180.8 180.8 27.6 IIFL Securities Limited (“IIFL Securities”) 37.2 % 138.0 35.0 101.0 136.0 14.0 Seven Islands Shipping Limited (“Seven Islands”) 48.5 % 105.9 — 98.5 98.5 (0.5) Other — 84.8 10.9 59.8 70.7 0.5 3,196.3 552.2 1,348.9 1,901.1 32.6 Real estate KWF Real Estate Ventures Limited Partnerships (“KWF LPs”) — 76.3 76.3 (d) — 76.3 (9.0) Other — 139.6 140.5 — 140.5 (1.7) 215.9 216.8 — 216.8 (10.7) Other Eurobank Ergasias Services & Holdings S.A (“Eurobank”) 32.2 % 1,210.3 1,298.5 — 1,298.5 162.3 Atlas Corp. (“Atlas”, formerly Seaspan Corporation) (11) 36.7 % 1,285.8 922.1 — 922.1 69.5 Resolute Forest Products Inc. (“Resolute”) 32.3 % 377.1 275.8 — 275.8 75.9 EXCO Resources Inc. (“EXCO”) 43.3 % 267.2 195.4 — 195.4 (41.2) Helios Fairfax Partners Corporation (“HFP”) (12) 34.4 % 116.2 206.1 — 206.1 (1.2) Peak Achievement Athletics (“Peak Achievement”) 42.6 % 181.2 140.5 (d) — 140.5 13.3 Partnerships, trusts and other — 342.1 340.3 — 340.3 28.9 3,779.9 3,378.7 — 3,378.7 307.5 7,192.1 4,147.7 1,348.9 5,496.6 329.4 Investments in associates 8,291.2 4,755.1 1,348.9 6,104.0 402.0 As presented on the consolidated balance sheet: Investments in associates 5,671.9 4,755.1 Fairfax India investments in associates 2,619.3 1,348.9 8,291.2 6,104.0 (a) Ownership percentages include the effects of financial instruments that are considered in-substance equity. (b) See note 5 for fair value hierarchy information. (c) Fairfax India’s associates are domiciled in India. (d) These investments are joint ventures. Insurance and reinsurance associates and joint ventures (1) Digit Insurance and the company applied to the Insurance Regulatory and Development Authority of India (“IRDAI”) for approval to convert the company’s holdings in compulsory convertible preferred shares issued by Digit (“Digit CCPS”) into equity shares of Digit. The IRDAI subsequently communicated that the application could not be considered in its current form as conversion of the Digit CCPS would result in Digit (currently classified as an “Indian promoter” of Digit Insurance) becoming a subsidiary of the company, which was, at such time, prohibited under the then prevailing Indian insurance regulations. Since then, the IRDAI has enacted new regulations that have introduced a definition of a “Foreign Promoter”, which would permit an Indian insurance company (like Digit Insurance) to be a subsidiary of a “Foreign Promoter”. However, Digit does not currently qualify as a “Foreign Promoter” under these new regulations. Digit, Digit Insurance and the company intend to continue to explore all avenues under applicable law to achieve the company’s majority ownership of Digit through conversion of the company’s Digit CCPS. (2) On February 8, 2021 the company entered into an arrangement to purchase (unless sold earlier) certain portfolio investments owned by RiverStone Barbados as described in note 23 and subsequently commenced applying the equity method of accounting to its interest in Gulf Insurance pursuant to that arrangement. (3) On July 14, 2021 the company increased its interest in Eurolife to 80.0% and commenced consolidating Eurolife as described in note 23. (4) On June 17, 2021 the company increased its equity interest in Singapore Re from 28.2% to 94.0% and commenced consolidating Singapore Re as described in note 23. (5) On August 23, 2021 the company completed the sale of its joint venture interest in RiverStone Barbados, pursuant to the transactions described in note 23. Non-insurance associates and joint ventures (6) On July 5, 2022 the company increased its interest in Grivalia Hospitality S.A. (“Grivalia Hospitality”) to 78.4% from 33.5% and commenced consolidating Grivalia Hospitality as described in note 23. (7) On April 6, 2022 the company acquired 25.0 million Atlas common shares by exercising its equity warrants in Atlas with a strike price of $8.05 per share for aggregate cash consideration of $201.3 . On derecognition of the equity warrants, the company recorded a net loss on investment of $37.2 (realized gains of $58.6 , of which $95.8 was recorded as unrealized gains in prior years) and recorded the fair value of these shares of $335.3 as an addition to its equity accounted investment in Atlas. On October 4, 2022, the company increased its interest in Atlas to 43.2% through the purchase of Atlas common shares held through the company’s investment in AVLNs entered with RiverStone Barbados (as described in note 23) for cash consideration of $84.8 . On October 31, 2022 a consortium composed of the company, the Washington Family, David Sokol, Chairman of the Board of Directors of Atlas, and Ocean Network Express Pte. Ltd., a global container, transportation and shipping company (collectively, the “Consortium”), signed a definitive agreement to acquire all of the outstanding common shares of Atlas, other than those shares owned by the Consortium, at a cash purchase price of $15.50, plus payment of all ordinary course quarterly dividends up until closing of the transaction. Pursuant to the transaction, the company would transfer its approximate 45% interest in Atlas, inclusive of the company’s interest through its holdings in Atlas equity warrants that were exercised on January 12, 2023 for cash consideration of $78.7, into Poseidon Acquisitions Corp. (“Poseidon”, an entity formed by the Consortium), and is not obligated to purchase any additional interest not already owned by the Consortium. The other members of the Consortium have committed to fully fund the cash component of the transaction, and the company would continue its ownership in Atlas as part of the Consortium. Closing of the transaction is expected to be in the first half of 2023, and is subject to receipt of regulatory approvals and certain other customary closing conditions. The company expects to continue to apply the equity method of accounting to its interest in Atlas through its interest in Poseidon on closing of the transaction. (8) On July 5, 2022 Domtar Corporation entered into a definitive agreement with Resolute to acquire all outstanding common shares of Resolute for a combination of cash consideration of $20.50 and a Contingent Value Right (“CVR”) per Resolute common share. The CVR provides holders with the right to a share of any future softwood lumber duty deposit refunds. Pursuant to the transaction, on July 5, 2022 the company measured its investment in Resolute as held for sale and ceased applying the equity method of accounting, with the carrying value and fair value of the associate at December 31, 2022 equal to the fair value of the cash consideration of $508.5 or $20.50 per Resolute common share. The transaction closed on March 1, 2023. (9) On August 31, 2022 Stelco Holdings Inc. repurchased 5.1 million of its outstanding common shares under its substantial issuer bid which resulted in the loss of a certain right held by another investor and the company’s ownership interest in Stelco increasing to 20.5% . Accordingly, the company commenced applying the equity method of accounting to its interest in Stelco which had a fair value of $352.2 (Cdn $461.3 ) on that date. Stelco is a publicly listed independent steelmaker that produces flat-rolled, coated, and cold-rolled steel products for the construction, automotive, and energy industries in North America. (10) During 2021 the company reduced its interest in IIFL Finance to 22.3% by selling a portion of its interest for cash proceeds of $113.7 ( 8.6 billion Indian rupees) and recorded a net realized gain of $42.0 in the consolidated statement of earnings. (11) On June 11, 2021 the company entered into an exchange and amendment transaction with Atlas in relation to its investment in $575.0 principal amount of debentures issued by Seaspan Corporation (“Seaspan”), an operating subsidiary of Atlas, whereby the company exchanged $288.0 principal amount of those Seaspan debentures for newly-issued Atlas Series J preferred shares and equity warrants with an exercise price of $13.71 per share. The terms of the remaining Seaspan debentures were amended to primarily remove the company’s mandatory put rights and discharge all outstanding guarantees and liens on collateral. The company derecognized the Seaspan debentures that were exchanged and recorded its investment in the Atlas preferred shares and warrants as preferred stocks and derivatives respectively on the consolidated balance sheet. On August 23, 2021 Atlas redeemed the remaining $287.0 principal amount of the Seaspan debentures. (12) On March 31, 2021 the company invested $100.0 in $100.0 principal amount of Helios Fairfax Partners Corporation (“HFP”) 3.0% unsecured debentures and warrants to purchase 3 million HFP subordinate voting shares exercisable at $4.90 per share any time prior to the fifth anniversary of closing. The debentures will mature on the third anniversary of closing or, at the company’s option, on either the first or second anniversary. At redemption or maturity, if the fair value of certain Fairfax Africa legacy investments held by HFP are below their fair value at June 30, 2020 of $102.6 , the redemption price of the debentures will be reduced by that difference. The company recorded the debentures at their initial fair value of $78.0 and recorded the balance of $22.0 as an addition to its equity accounted investment in HFP. Fairfax India (13) On September 16, 2021 Fairfax India transferred 43.6% out of its 54.0% equity interest in Bangalore Airport to Anchorage Infrastructure Investments Holdings Limited (“Anchorage”), its wholly-owned holding company for investments in the airport sector of India, and sold an 11.5% equity interest in Anchorage to OMERS for gross proceeds of $129.2 ( 9.5 billion Indian rupees). Upon closing Fairfax India recorded a non-controlling interest in Anchorage and continued to equity account for its aggregate 54.0% equity interest in Bangalore Airport. |
Schedule of changes in the carrying value of investments in associates | Changes in the carrying value of investments in associates for the years ended December 31 were as follows: 2022 Fairfax India Associates Joint ventures associates Total Balance - January 1 3,858.7 896.4 1,348.9 6,104.0 Share of pre-tax comprehensive income (loss): Share of profit 856.6 26.1 132.0 1,014.7 Share of other comprehensive income (loss), excluding gains (losses) on defined benefit plans (111.5) (53.0) 14.4 (150.1) Share of gains (losses) on defined benefit plans 74.4 0.6 (5.4) 69.6 819.5 (26.3) 141.0 934.2 Dividends and distributions received (142.2) (33.7) (7.0) (182.9) Purchases and acquisitions 429.1 88.6 10.1 527.8 Divestitures and other net changes in capitalization 9.9 (11.9) 34.4 32.4 Reclassifications (1) 352.2 (114.3) (40.4) 197.5 Foreign exchange effect and other (16.8) (17.9) (144.4) (179.1) Balance - December 31 5,310.4 780.9 1,342.6 7,433.9 2021 Fairfax India Associates Joint ventures associates Total Balance - January 1 3,170.4 1,940.9 1,328.3 6,439.6 Share of pre-tax comprehensive income (loss): Share of profit 375.8 6.0 20.2 402.0 Share of other comprehensive income (loss), excluding gains (losses) on defined benefit plans (67.7) (20.5) 0.3 (87.9) Share of gains (losses) on defined benefit plans 89.1 0.1 (9.4) 79.8 397.2 (14.4) 11.1 393.9 Dividends and distributions received (153.8) (23.6) (4.6) (182.0) Purchases and acquisitions 466.5 114.4 35.7 616.6 Divestitures and other net changes in capitalization (54.8) (764.4) 0.9 (818.3) Reclassifications (1) 36.4 (352.0) — (315.6) Foreign exchange effect and other (3.2) (4.5) (22.5) (30.2) Balance - December 31 3,858.7 896.4 1,348.9 6,104.0 (1) Primarily reflects the consolidation of Grivalia Hospitality and the commencement of the equity method of accounting for Stelco in 2022, and the consolidation of Eurolife and Singapore Re and the commencement of the equity method of accounting for a limited partnership investment in 2021. See note 23. |
Derivatives (Tables)
Derivatives (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Derivatives | |
Schedule of derivative financial instruments | December 31, 2022 December 31, 2021 Notional Fair value Notional Fair value amount Cost Assets Liabilities amount Cost Assets Liabilities Equity derivative contracts (1) 1,946.5 68.0 258.1 19.4 1,728.9 113.9 355.3 3.8 RiverStone Barbados AVLNs (note 23) 517.5 — 30.7 — 1,250.1 — 103.8 — Foreign currency derivative contracts (2) — — 49.0 106.8 — — 58.4 77.4 Other derivative contracts — 289.8 130.0 64.8 — 263.3 64.3 71.7 Total 467.8 191.0 581.8 152.9 (1) Includes the company’s investment in Atlas warrants with a fair value at December 31, 2022 of $13.5 (December 31, 2021 - $200.1 ), which were subsequently exercised on January 12, 2023 as described in note 6. (2) Includes AGT’s foreign currency forward and swap liabilities with a fair value at December 31, 2022 of $56.2 (December 31, 2021 - $47.6 ). |
Insurance Contract Liabilities
Insurance Contract Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Insurance Contract Liabilities | |
Schedule of insurance contract liabilities | December 31, 2022 December 31, 2021 Gross Ceded Net Gross Ceded Net Provision for unearned premiums 11,691.8 2,413.1 9,278.7 10,437.7 2,260.0 8,177.7 Provision for losses and loss adjustment expenses 38,319.2 9,245.9 29,073.3 34,422.8 8,943.9 25,478.9 Property and casualty insurance contract liabilities 50,011.0 11,659.0 38,352.0 44,860.5 11,203.9 33,656.6 Provision for life policy benefits (1)(2) 2,188.6 2.6 2,186.0 2,486.0 2.3 2,483.7 Insurance contract liabilities 52,199.6 11,661.6 40,538.0 47,346.5 11,206.2 36,140.3 Current 23,807.9 5,052.4 18,755.5 20,618.3 4,740.3 15,878.0 Non-current 28,391.7 6,609.2 21,782.5 26,728.2 6,465.9 20,262.3 52,199.6 11,661.6 40,538.0 47,346.5 11,206.2 36,140.3 (1) Eurolife was consolidated on July 14, 2021 as described in note 23. (2) Provision for life policy benefits includes gross and ceded provisions for unearned premiums of $18.2 and $0.4 (2021 - $16.5 and nil ). |
Summary of changes in the property and casualty provision for unearned premiums | Changes in the property and casualty provision for unearned premiums for the years ended December 31 were as follows: 2022 2021 Provision for unearned premiums – January 1 10,437.7 8,397.5 Gross premiums written 27,561.7 23,796.0 Less: gross premiums earned (26,106.7) (21,673.6) Acquisitions of subsidiaries (note 23) — 64.1 Divestiture of subsidiary — (62.9) Foreign exchange effect and other (200.9) (83.4) Provision for unearned premiums - December 31 11,691.8 10,437.7 |
Summary of changes in the property and casualty provision for losses and loss adjustment expenses | Changes in the property and casualty provision for losses and loss adjustment expenses for the years ended December 31 were as follows: 2022 2021 Provision for losses and loss adjustment expenses – January 1 34,422.8 30,809.3 Decrease in estimated losses and expenses for claims occurring in the prior years (44.0) (283.1) Losses and expenses for claims occurring in the current year 17,300.2 14,396.8 Paid on claims occurring during: the current year (3,978.6) (3,148.6) the prior years (8,734.7) (7,212.8) Acquisitions of subsidiaries (note 23) 3.8 297.3 Divestiture of subsidiary — (18.7) Foreign exchange effect and other (1) (650.3) (417.4) Provision for losses and loss adjustment expenses – December 31 38,319.2 34,422.8 (1) Foreign exchange effect and other principally reflected the decrease of reserves denominated in the Canadian dollar, British pound, euro and Argentinian peso which weakened against the U.S. dollar (2021 - principally reflected the decrease of reserves denominated in the euro, Chilean peso, Argentinian peso, Colombian peso and South African rand which weakened against the U.S. dollar). |
Summary of changes in the provision for life policy benefits | Changes in the provision for life policy benefits for the years ended December 31, following the acquisition of Eurolife on July 14, 2021, were as follows: 2022 2021 Provision for life policy benefits – January 1 2,486.0 — Acquisition of subsidiary (note 23) — 2,638.5 New business and renewals 275.9 78.1 Surrenders, lapses, maturities and deaths (359.4) (121.0) Foreign exchange effect and other (1) (213.9) (109.6) Provision for life policy benefits – December 31 2,188.6 2,486.0 (1) Foreign exchange effect and other principally reflected the depreciation of euro denominated reserves against the U.S. dollar. |
Schedule of development of gross insurance losses | Calendar year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Property and casualty provision for losses and loss adjustment expenses 19,212.8 17,749.1 19,816.4 19,481.8 28,610.8 29,081.7 28,500.2 30,809.3 34,422.8 38,319.2 Less: CTR Life (1) 17.9 15.2 14.2 12.8 8.7 8.0 7.0 5.5 4.4 4.4 19,194.9 17,733.9 19,802.2 19,469.0 28,602.1 29,073.7 28,493.2 30,803.8 34,418.4 38,314.8 Cumulative payments as of: One year later 4,081.1 3,801.6 4,441.4 4,608.0 7,564.0 7,732.0 7,288.8 7,180.7 8,734.7 Two years later 6,787.6 6,364.5 7,283.6 7,631.4 12,081.3 12,313.5 11,598.0 12,501.3 Three years later 8,775.5 8,172.7 9,466.5 9,655.9 15,222.3 15,363.3 15,475.2 Four years later 10,212.4 9,561.8 10,914.2 11,122.6 17,378.8 18,132.3 Five years later 11,354.4 10,496.4 12,013.9 12,233.4 13,340.9 Six years later 12,123.4 11,202.2 12,859.5 13,196.6 Seven years later 12,754.2 11,793.5 13,568.0 Eight years later 13,283.6 12,390.7 Nine years later 13,840.6 Reserves re-estimated as of: One year later 18,375.6 16,696.4 19,169.3 19,343.1 27,580.6 28,974.3 28,225.5 30,360.1 33,931.1 Two years later 17,475.0 16,269.2 18,973.6 18,804.8 27,565.9 28,839.4 28,165.4 30,267.4 Three years later 17,307.9 16,114.0 18,502.5 18,752.8 27,451.3 28,990.4 28,242.2 Four years later 17,287.2 15,938.9 18,469.1 18,743.9 27,698.6 29,284.5 Five years later 17,203.5 16,049.6 18,490.5 19,046.6 27,977.0 Six years later 17,340.1 16,123.1 18,759.5 19,203.7 Seven years later 17,420.0 16,403.8 18,866.6 Eight years later 17,680.5 16,595.5 Nine years later 17,843.1 Favourable (adverse) development 1,351.8 1,138.4 935.6 265.3 605.1 (210.8) 251.0 536.4 487.3 Favourable development comprised of: Effect of foreign currency translation 522.8 326.8 (129.1) (84.5) 759.2 395.7 452.9 425.6 443.3 Favourable (adverse) loss reserve development 829.0 811.6 1,064.7 349.8 (154.1) 606.5 (201.9) 110.8 44.0 1,351.8 1,138.4 935.6 265.3 605.1 (210.8) 251.0 536.4 487.3 (1) Guaranteed minimum death benefit retrocessional business written by Compagnie Transcontinentale de Réassurance (“CTR Life”), a wholly owned subsidiary of the company that was transferred to Wentworth and placed into run-off in 2002. |
Summary of changes in the company's provision for losses and loss adjustment expenses related to U.S. asbestos exposure | Changes in the company’s provision for losses and loss adjustment expenses related to U.S. asbestos exposure on a gross and net basis for the years ended December 31 were as follows: 2022 2021 Gross Net Gross Net Provision for asbestos claims and loss adjustment expenses - January 1 1,036.7 838.9 1,030.6 840.0 Losses and loss adjustment expenses incurred 215.8 113.7 199.1 151.6 Losses and loss adjustment expenses paid (175.2) (132.5) (193.0) (152.7) Provision for asbestos claims and loss adjustment expenses - December 31 1,077.3 820.1 1,036.7 838.9 |
Reinsurance (Tables)
Reinsurance (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Reinsurance | |
Schedule of reinsurers' share of amounts arising from insurance contracts | December 31, 2022 December 31, 2021 Gross Provision for Recoverable Gross Provision for Recoverable recoverable from uncollectible from recoverable from uncollectible from reinsurers reinsurance (1) reinsurers reinsurers reinsurance (1) reinsurers Provision for losses and loss adjustment expenses 9,274.8 (26.7) 9,248.1 8,989.3 (43.1) 8,946.2 Reinsurers’ share of paid losses 1,599.4 (145.2) 1,454.2 1,019.9 (135.6) 884.3 Provision for unearned premiums 2,413.5 — 2,413.5 2,260.0 — 2,260.0 13,287.7 (171.9) 13,115.8 12,269.2 (178.7) 12,090.5 Current 6,414.4 5,572.4 Non-current 6,701.4 6,518.1 13,115.8 12,090.5 (1) Management of credit risk on reinsurance recoverables is discussed in note 24. |
Schedule of changes in reinsurers' share of paid losses, unpaid losses and unearned premiums, and the provision for uncollectible reinsurance | Changes in reinsurers’ share of paid losses, unpaid losses and unearned premiums, and the provision for uncollectible reinsurance for the years ended December 31 were as follows: 2022 Provision for Recoverable Paid Unpaid Unearned uncollectible from losses losses premiums reinsurance reinsurers Balance – January 1 1,019.9 8,989.3 2,260.0 (178.7) 12,090.5 Reinsurers’ share of losses paid to insureds 3,142.8 (3,142.8) — — — Reinsurance recoveries received (2,551.0) — — — (2,551.0) Reinsurers’ share of unpaid losses and premiums earned — 3,642.0 (5,448.8) — (1,806.8) Premiums ceded to reinsurers — — 5,640.9 — 5,640.9 Foreign exchange effect and other (12.3) (213.7) (38.6) 6.8 (257.8) Balance – December 31 1,599.4 9,274.8 2,413.5 (171.9) 13,115.8 2021 Provision for Recoverable Paid Unpaid Unearned uncollectible from losses losses premiums reinsurance reinsurers Balance – January 1 818.0 7,971.7 1,899.1 (155.6) 10,533.2 Reinsurers’ share of losses paid to insureds 2,360.3 (2,360.3) — — — Reinsurance recoveries received (2,152.8) — — — (2,152.8) Reinsurers’ share of unpaid losses and premiums earned (1) — 3,479.0 (5,228.8) — (1,749.8) Premiums ceded to reinsurers (1) — — 5,632.1 — 5,632.1 Acquisitions of subsidiaries (note 23) 0.3 82.7 16.7 — 99.7 Divestiture of subsidiary (3.3) (6.4) (10.6) — (20.3) Foreign exchange effect and other (2.6) (177.4) (48.5) (23.1) (251.6) Balance – December 31 1,019.9 8,989.3 2,260.0 (178.7) 12,090.5 (1) Effective October 1, 2021 Brit completed a loss portfolio transfer with a third party to reinsure loss reserves for a portfolio of risks predominantly comprised of U.S. casualty and discontinued lines of business relating to prior accident years. Pursuant to this transaction Brit ceded net insurance contract liabilities of $379.1 for consideration of $344.1 and recorded net favourable reserve development of $35.0 . |
Insurance Contract Receivable_2
Insurance Contract Receivables and Payables (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Insurance Contract Receivables and Payables | |
Schedule of insurance contract receivables | December 31, December 31, 2022 2021 Insurance premiums receivable 4,972.7 4,247.1 Reinsurance premiums receivable 2,114.6 1,863.9 Funds withheld receivable 550.6 574.0 Other 269.6 198.2 7,907.5 6,883.2 Current 7,330.0 6,170.0 Non-current 577.5 713.2 7,907.5 6,883.2 |
Schedule of changes in insurance premiums receivable and reinsurance premiums receivable | Insurance Reinsurance premiums receivable premiums receivable 2022 2021 2022 2021 Balance – January 1 4,247.1 3,665.6 1,863.9 1,385.3 Gross premiums written 20,516.3 18,118.6 7,396.3 5,791.6 Premiums collected (17,571.5) (15,703.6) (5,366.6) (3,963.7) Amounts due to brokers and agents (2,089.4) (1,770.1) (1,806.1) (1,332.3) Foreign exchange effect and other (129.8) (63.4) 27.1 (17.0) Balance – December 31 4,972.7 4,247.1 2,114.6 1,863.9 |
Schedule of insurance contract payables | December 31, December 31, 2022 2021 Payable to reinsurers 2,289.1 2,333.7 Payables associated with unit-linked life insurance products (note 3 and note 23) 662.5 621.7 Ceded deferred premium acquisition costs 564.6 510.3 Funds withheld payable to reinsurers 193.5 274.0 Amounts payable to agents and brokers 112.5 142.4 Accrued premium taxes 105.7 124.1 Accrued commissions 157.8 100.8 Other insurance contract payables 976.2 386.5 5,061.9 4,493.5 Current 4,101.0 3,503.4 Non-current 960.9 990.1 5,061.9 4,493.5 |
Deferred Premium Acquisition _2
Deferred Premium Acquisition Costs (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Deferred Premium Acquisition Costs | |
Schedule of changes in deferred premium acquisition costs | Changes in deferred premium acquisition costs for the years ended December 31 were as follows: 2022 2021 Balance – January 1 1,924.1 1,543.7 Premium acquisition costs deferred 5,212.5 4,502.4 Amortization (4,932.2) (4,098.1) Foreign exchange effect and other (34.1) (23.9) Balance – December 31 2,170.3 1,924.1 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets | |
Schedule of changes in goodwill and intangible assets | Goodwill Intangible assets Total Lloyd’s Customer Computer participation and broker Brand software rights (1) relationships names (1) and other (1) Balance - January 1, 2022 3,084.8 503.2 760.9 1,087.3 492.0 5,928.2 Additions 152.0 — 25.9 (0.3) 267.6 445.2 Disposals (2) (81.9) — (31.6) (8.5) (3.2) (125.2) Amortization — — (91.7) — (134.9) (226.6) Impairments (3) (137.0) — — — (0.9) (137.9) Foreign exchange effect and other (90.4) — (9.6) (60.2) (34.5) (194.7) Balance - December 31, 2022 2,927.5 503.2 653.9 1,018.3 586.1 5,689.0 Gross carrying amount 3,161.8 503.2 1,279.0 1,060.1 1,594.2 7,598.3 Accumulated amortization — — (631.6) — (988.3) (1,619.9) Accumulated impairment and other (234.3) — 6.5 (41.8) (19.8) (289.4) 2,927.5 503.2 653.9 1,018.3 586.1 5,689.0 Goodwill Intangible assets Total Lloyd’s Customer Computer participation and broker Brand software rights (1) relationships names (1) and other (1) Balance - January 1, 2021 3,126.3 503.2 867.5 1,153.3 578.8 6,229.1 Additions 60.7 — 17.8 27.9 264.3 370.7 Disposals (2) (28.9) — (25.1) (64.0) (7.5) (125.5) Amortization — — (96.6) — (342.8) (439.4) Impairments (3) (52.1) — — (33.1) (0.1) (85.3) Foreign exchange effect and other (21.2) — (2.7) 3.2 (0.7) (21.4) Balance - December 31, 2021 3,084.8 503.2 760.9 1,087.3 492.0 5,928.2 Gross carrying amount 3,214.1 503.2 1,338.5 1,139.2 1,427.0 7,622.0 Accumulated amortization — — (577.4) — (915.4) (1,492.8) Accumulated impairment (129.3) — (0.2) (51.9) (19.6) (201.0) 3,084.8 503.2 760.9 1,087.3 492.0 5,928.2 (1) Indefinite-lived intangible assets not subject to amortization had an aggregate carrying value at December 31, 2022 of $1,613.6 (December 31, 2021 - $1,686.2 ). (2) During 2022 the company sold its interests in the Crum & Forster Pet Insurance Group and Pethealth. During 2021 the company sold the operations of Toys “R” Us Canada and Fairfax India sold its 48.8% equity interest in Privi. See note 23. (3) Non-cash impairment charges recorded in operating expenses and in other expenses in the consolidated statement of earnings by the insurance and reinsurance companies and Non-insurance companies reporting segment, respectively. During 2022 the company recognized non-cash goodwill impairment charges of $133.4 on Farmers Edge. |
Schedule goodwill and intangible asset allocation to CGUs | December 31, 2022 December 31, 2021 Intangible Intangible Goodwill assets Total Goodwill assets Total Insurance and reinsurance companies Allied World 940.0 519.8 1,459.8 940.0 565.8 1,505.8 Brit 214.6 565.5 780.1 215.6 580.5 796.1 Zenith National 317.6 77.7 395.3 317.6 84.4 402.0 Northbridge 81.6 133.5 215.1 94.9 121.3 216.2 Crum & Forster 132.6 57.8 190.4 189.1 91.0 280.1 Odyssey Group 119.7 50.8 170.5 119.7 54.9 174.6 All other (1) 85.1 108.3 193.4 95.9 116.3 212.2 1,891.2 1,513.4 3,404.6 1,972.8 1,614.2 3,587.0 Non-insurance companies Recipe 298.9 902.2 1,201.1 321.2 980.5 1,301.7 Boat Rocker 86.4 184.8 271.2 89.1 90.2 179.3 AGT 147.6 49.6 197.2 154.4 34.9 189.3 Thomas Cook India 127.7 48.4 176.1 142.1 54.5 196.6 Farmers Edge 63.3 11.4 74.7 208.3 16.0 224.3 All other (2) 312.4 51.7 364.1 196.9 53.1 250.0 1,036.3 1,248.1 2,284.4 1,112.0 1,229.2 2,341.2 2,927.5 2,761.5 5,689.0 3,084.8 2,843.4 5,928.2 (1) Comprised primarily of balances related to AMAG Insurance, Eurolife and Pacific Insurance. (2) Comprised primarily of balances related to Dexterra Group, Fairfax India’s subsidiaries (principally from the 2022 acquisitions of Maxop and Jaynix), Grivalia Hospitality (consolidated on July 5, 2022) and Sterling Resorts, and in 2021 included Pethealth (deconsolidated on October 31, 2022). |
Other Assets (Tables)
Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Assets | |
Schedule of other assets | December 31, 2022 December 31, 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total Premises and equipment, right-of-use assets (note 22) and non-insurance companies’ investment property (2) 684.0 2,199.7 2,883.7 725.6 1,558.4 2,284.0 Assets associated with unit-linked insurance products (note 3 and note 23) 676.5 — 676.5 637.1 — 637.1 Inventories — 668.2 668.2 — 547.3 547.3 Other revenue receivables — 638.9 638.9 — 508.4 508.4 Accrued interest and dividends 313.7 3.5 317.2 211.4 3.7 215.1 Income tax, sales tax and subsidies receivable 71.3 204.6 275.9 61.6 170.3 231.9 Prepaid expenses 111.0 134.8 245.8 110.9 94.9 205.8 Finance lease receivables (note 22) 8.8 218.0 226.8 9.4 256.7 266.1 Prepaid losses on claims 168.9 — 168.9 129.4 — 129.4 Pension surplus (note 21) 144.5 — 144.5 113.8 — 113.8 Receivable for securities sold but not yet settled 11.2 — 11.2 135.4 — 135.4 Other (3) 738.5 85.6 824.1 791.1 55.9 847.0 2,928.4 4,153.3 7,081.7 2,925.7 3,195.6 6,121.3 Current 993.9 1,632.6 2,626.5 989.9 1,343.7 2,333.6 Non-current 1,934.5 2,520.7 4,455.2 1,935.8 1,851.9 3,787.7 2,928.4 4,153.3 7,081.7 2,925.7 3,195.6 6,121.3 (1) Includes Life insurance and Run-off, and Corporate and Other. (2) The increase during 2022 principally reflected the consolidation of Grivalia Hospitality and its hospitality real estate as described in note 23. (3) Principally comprised of other receivables, deposits and deferred compensation plans. |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounts Payable and Accrued Liabilities | |
Schedule of accounts payable and accrued liabilities | December 31, 2022 December 31, 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total Lease liabilities (note 22) 364.1 729.9 1,094.0 384.2 756.5 1,140.7 Payables related to cost of sales — 814.3 814.3 — 580.9 580.9 Salaries and employee benefit liabilities 500.5 98.5 599.0 482.6 85.6 568.2 Amounts withheld and accrued taxes 455.8 30.7 486.5 453.9 23.8 477.7 Deferred gift card, hospitality and other revenue 37.8 392.0 429.8 35.4 318.5 353.9 Income taxes payable 347.0 14.0 361.0 163.8 11.2 175.0 Pension and post retirement liabilities (note 21) 132.9 12.8 145.7 237.4 16.5 253.9 Administrative and other (2) 946.6 338.3 1,284.9 1,150.9 284.2 1,435.1 2,784.7 2,430.5 5,215.2 2,908.2 2,077.2 4,985.4 Current 1,528.4 1,553.3 3,081.7 1,538.7 1,177.2 2,715.9 Non-current 1,256.3 877.2 2,133.5 1,369.5 900.0 2,269.5 2,784.7 2,430.5 5,215.2 2,908.2 2,077.2 4,985.4 (1) Includes Life insurance and Run-off and Corporate and Other. (2) Principally comprised of accrued operating expenses, advances from customers and liabilities related to business acquisitions . |
Borrowings (Tables)
Borrowings (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Borrowings | |
Schedule of borrowings | December 31, 2022 December 31, 2021 Principal Carrying Fair Principal Carrying Fair value (a) value (b) value (a) value (b) Borrowings - holding company Fairfax unsecured notes (d) 4.875% due August 13, 2024 282.5 281.6 277.0 282.5 281.1 301.7 4.95% due March 3, 2025 (Cdn$350.0) 258.3 257.2 255.2 277.1 275.4 299.6 8.30% due April 15, 2026 (e) 91.8 91.7 98.2 91.8 91.7 113.3 4.70% due December 16, 2026 (Cdn$450.0) 332.1 331.0 323.7 356.3 354.8 387.9 4.25% due December 6, 2027 (Cdn$650.0) 479.7 478.6 455.8 514.6 513.1 551.4 2.75% due March 29, 2028 (€750.0) 800.5 792.2 698.3 852.9 842.4 926.3 4.85% due April 17, 2028 600.0 596.9 568.1 600.0 596.3 668.5 4.23% due June 14, 2029 (Cdn$500.0) 369.0 367.7 342.7 395.8 394.2 424.4 4.625% due April 29, 2030 650.0 646.4 591.1 650.0 645.9 730.0 3.375% due March 3, 2031 600.0 586.8 492.8 600.0 585.1 620.7 3.95% due March 3, 2031(Cdn$850.0) 627.4 623.2 549.4 672.9 668.0 701.3 5.625% due August 16, 2032 (1) 750.0 743.6 707.1 — — — 7.75% due July 15, 2037 (e) 91.3 90.7 95.2 91.3 90.6 125.4 Revolving credit facility (2) — — — — — — 5,932.6 5,887.6 5,454.6 5,385.2 5,338.6 5,850.5 Borrowings - insurance and reinsurance companies Allied World 4.35% senior notes due October 29, 2025 500.0 502.9 477.7 500.0 503.9 536.9 Allied World revolving credit facility and other borrowings 16.8 19.8 16.9 17.4 20.6 21.1 Zenith National 8.55% debentures due August 1, 2028 (d) 38.5 38.3 38.5 38.5 38.3 38.3 Brit 3.6757% subordinated notes due December 9, 2030 (£135.0) 162.4 162.4 120.6 182.9 182.9 174.5 Brit floating rate revolving credit facility 10.0 10.0 10.0 45.0 45.0 45.0 727.7 733.4 663.7 783.8 790.7 815.8 Borrowings - non-insurance companies (c) Fairfax India 5.00% unsecured senior notes due 2028 441.6 438.9 400.7 441.6 438.4 440.3 Fairfax India subsidiary borrowings 122.6 122.2 122.2 91.9 91.3 91.3 AGT credit facilities, senior notes and loans (3) 511.9 508.4 498.8 491.8 488.9 488.9 Recipe term loans and credit facilities (4) 464.0 461.5 436.7 359.0 356.9 356.9 Boat Rocker demand loans and revolving credit facilities 155.4 155.2 155.4 93.8 93.1 93.1 Loans and revolving credit facilities primarily at floating rates (5) 317.7 317.7 317.7 155.2 155.1 155.1 2,013.2 2,003.9 1,931.5 1,633.3 1,623.7 1,625.6 Total debt 8,673.5 8,624.9 8,049.8 7,802.3 7,753.0 8,291.9 ( a) Principal net of unamortized issue costs and discounts (premiums). (b) Based principally on quoted market prices with the remainder based on discounted cash flow models using market observable inputs (Levels 1 and 2 respectively in the fair value hierarchy). (c) These borrowings are non-recourse to the holding company. (d) Issuer may redeem any time at prices specified in the instrument’s offering document, except those disclosed in footnote (e) below. (e) Not redeemable prior to the contractual maturity date. During 2022 the company and its subsidiaries completed the following debt transactions: Holding company (1) On August 16, 2022 the company completed an offering of $750.0 principal amount of 5.625% unsecured senior notes due August 16, 2032 for net proceeds of $743.4 after discount, commissions and expenses. Commissions and expenses of $5.5 were included in the carrying value of the notes. (2) On June 29, 2022 the company amended and restated its $2.0 billion unsecured revolving credit facility with a syndicate of lenders on substantially the same terms which extended the expiry from June 29, 2026 to June 29, 2027. At December 31, 2022 and 2021, the revolving credit facility was undrawn and the company was in compliance with its financial covenants. Non-insurance companies (3) On December 28, 2022 AGT extended the maturity of its credit facilities to March 17, 2024. (4) Recipe increased its borrowings during 2022 principally as a result of the privatization transaction described in note 23. (5) On July 5, 2022 the company consolidated Grivalia Hospitality as described in note 23, including its borrowings of $111.3 at December 31, 2022. |
Summary of changes in the carrying values of borrowings | Changes in the carrying values of borrowings for the years ended December 31 were as follows: 2022 2021 Insurance Insurance and Non- and Non- Holding reinsurance insurance Holding reinsurance insurance company companies companies Total company companies companies Total Balance – January 1 5,338.6 790.7 1,623.7 7,753.0 5,580.6 1,033.4 2,200.0 8,814.0 Cash inflows from issuances 743.4 — 47.0 790.4 1,250.0 — 499.1 1,749.1 Cash outflows from repayments — (0.3) (25.3) (25.6) (801.2) (131.7) (593.9) (1,526.8) Net cash inflows (outflows) from credit facilities and short term loans — (35.0) 304.1 269.1 (700.0) (84.3) (262.0) (1,046.3) Non-cash changes: Acquisition of subsidiaries (note 23) — — 137.1 137.1 — — — — Deconsolidation of subsidiary (note 23) — — — — — (22.5) (187.4) (209.9) Loss on redemption — — — — 45.7 — (0.1) 45.6 Foreign exchange effect and other (194.4) (22.0) (82.7) (299.1) (36.5) (4.2) (32.0) (72.7) Balance – December 31 5,887.6 733.4 2,003.9 8,624.9 5,338.6 790.7 1,623.7 7,753.0 |
Schedule of principal repayments of borrowings | Principal repayments on borrowings are due as follows: 2023 2024 2025 2026 2027 Thereafter Total Holding company — 282.5 258.3 423.9 479.7 4,488.2 5,932.6 Insurance and reinsurance companies 0.3 0.3 510.3 0.3 0.3 216.2 727.7 Non-insurance companies 371.8 748.2 33.7 30.9 30.4 798.2 2,013.2 Total 372.1 1,031.0 802.3 455.1 510.4 5,502.6 8,673.5 |
Total Equity (Tables)
Total Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Total Equity | |
Schedule of classes of share capital | 2022 2021 Subordinate voting shares – January 1 23,116,830 25,427,736 Purchases for cancellation (387,790) (2,137,923) Treasury shares acquired (295,474) (293,197) Treasury shares reissued 142,969 120,214 Subordinate voting shares – December 31 22,576,535 23,116,830 Multiple voting shares – beginning and end of year 1,548,000 1,548,000 Interest in multiple and subordinate voting shares held through ownership interest in shareholder – beginning and end of year (799,230) (799,230) Common stock effectively outstanding – December 31 23,325,305 23,865,600 |
Schedule of dividends paid | Date of declaration Date of record Date of payment Dividend per share Total cash payment January 4, 2023 January 19, 2023 January 26, 2023 $ 10.00 $ 245.2 January 5, 2022 January 20, 2022 January 27, 2022 $ 10.00 $ 249.9 January 5, 2021 January 21, 2021 January 28, 2021 $ 10.00 $ 272.1 |
Schedule of preferred shares | The terms of the company’s cumulative five-year rate reset preferred shares at December 31, 2022 were as follows: Next possible redemption and Number of Liquidation Fixed dividend Floating conversion shares Carrying preference per rate per dividend rate date (1)(2) outstanding (3) value (3) Stated capital (3) share annum per annum (4) Series C December 31, 2024 7,515,642 $ 170.8 Cdn $ 187.9 Cdn $ 25.00 4.71 % — Series D December 31, 2024 2,484,358 $ 56.4 Cdn $ 62.1 Cdn $ 25.00 — 7.28 % Series E March 31, 2025 5,440,132 $ 124.5 Cdn $ 136.0 Cdn $ 25.00 3.18 % — Series F March 31, 2025 2,099,046 $ 48.1 Cdn $ 52.5 Cdn $ 25.00 — 6.29 % Series G September 30, 2025 7,719,843 $ 182.1 Cdn $ 193.0 Cdn $ 25.00 2.96 % — Series H September 30, 2025 2,280,157 $ 53.8 Cdn $ 57.0 Cdn $ 25.00 — 6.69 % Series I December 31, 2025 10,420,101 $ 250.5 Cdn $ 260.5 Cdn $ 25.00 3.33 % — Series J December 31, 2025 1,579,899 $ 38.0 Cdn $ 39.5 Cdn $ 25.00 — 6.98 % Series K March 31, 2027 9,500,000 $ 231.7 Cdn $ 237.5 Cdn $ 25.00 4.67 % — Series M March 31, 2025 9,200,000 $ 179.6 Cdn $ 230.0 Cdn $ 25.00 5.00 % — $ 1,335.5 Cdn $ 1,456.0 (1) Fixed and floating rate cumulative preferred shares are redeemable by the company at each stated redemption date and on each subsequent five-year anniversary date at Cdn$ 25.00 per share. (2) Holders of Series C, Series E, Series G, Series I, Series K and Series M fixed rate cumulative preferred shares will have the option to convert their shares into Series D, Series F, Series H, Series J, Series L and Series N floating rate cumulative preferred shares respectively, at the specified conversion dates, and on each subsequent five-year anniversary date. Holders of Series D, Series F, Series H and Series J floating rate cumulative preferred shares will have the option to convert their shares into Series C, Series E, Series G and Series I fixed rate cumulative preferred shares respectively, at the specified conversion dates, and on each subsequent five-year anniversary date. (3) For each series of preferred shares, the number of shares outstanding, carrying value and stated capital remained unchanged during 2022 and 2021. (4) The Series D, Series F, Series H, and Series J preferred shares, and the Series L and Series N preferred shares (of which none are currently issued), have a floating dividend rate equal to the three-month Government of Canada treasury bill yield plus 3.15% , 2.16% , 2.56% , 2.85% , 3.51% and 3.98% respectively, with rate resets at the end of each calendar quarter. |
Schedule of AOCI | December 31, 2022 December 31, 2021 Income tax After-tax Pre-tax Income tax After-tax Pre-tax amount (expense) recovery amount amount recovery amount Items that may be subsequently reclassified to net earnings Foreign currency translation losses (904.7) 34.4 (870.3) (636.2) 24.6 (611.6) Share of accumulated other comprehensive loss of associates, excluding net gains (losses) on defined benefit plans (221.6) 17.6 (204.0) (79.8) 0.4 (79.4) (1,126.3) 52.0 (1,074.3) (716.0) 25.0 (691.0) Items that will not be subsequently reclassified to net earnings Net gains (losses) on defined benefit plans 43.8 (4.3) 39.5 (104.9) 27.5 (77.4) Share of net gains (losses) on defined benefit plans of associates 10.7 (4.7) 6.0 (57.3) 5.5 (51.8) Other 43.5 5.7 49.2 8.4 10.1 18.5 98.0 (3.3) 94.7 (153.8) 43.1 (110.7) Accumulated other comprehensive income (loss) attributable to shareholders of Fairfax (1,028.3) 48.7 (979.6) (869.8) 68.1 (801.7) |
Schedule of income tax (expense) recovery included in other comprehensive income (loss) | 2022 2021 Income tax on items that may be subsequently reclassified to net earnings Net unrealized foreign currency translation losses on foreign subsidiaries 10.0 5.2 Share of other comprehensive loss of associates, excluding net gains on defined benefit plans 18.1 12.7 28.1 17.9 Income tax on items that will not be subsequently reclassified to net earnings Net gains on defined benefit plans (32.2) (27.4) Share of net gains on defined benefit plans of associates (10.2) (12.8) (42.4) (40.2) Total income tax expense included in other comprehensive income (loss) (14.3) (22.3) |
Schedule of non-controlling interests | Net earnings (loss) attributable to non- December 31, 2022 December 31, 2021 controlling interests Domicile Voting Carrying Voting Carrying percentage (7) value percentage (7) value 2022 2021 Insurance and reinsurance companies (1) Allied World (2) Bermuda 17.1 % 761.1 29.1 % 1,419.6 (5.6) 117.8 Brit (3) United Kingdom 13.8 % 658.8 13.8 % 559.3 (23.2) 14.0 Odyssey Group (4) United States 9.99 % 499.2 9.99 % 550.0 19.6 — All other (5) — — 50.1 — 402.5 12.0 89.4 1,969.2 2,931.4 2.8 221.2 Non-insurance companies Restaurants and retail (6)(7) — — 208.1 — 494.3 32.7 11.8 Fairfax India (7)(8) Canada 5.6 % 1,080.2 6.1 % 1,133.1 114.2 72.7 Thomas Cook India India 26.7 % 61.3 33.2 % 56.3 1.1 (16.8) Other — — 340.8 — 315.1 (11.2) (23.4) 1,690.4 1,998.8 136.8 44.3 3,659.6 4,930.2 139.6 265.5 (1) Includes property and casualty insurance and reinsurance companies, Life insurance and Run-off, and Corporate and other. (2) On September 27, 2022 the company increased its ownership interest in Allied World to 82.9% from 70.9% for total consideration of $733.5 , inclusive of the fair value of a call option exercised and an accrued dividend paid, and recorded a loss in retained earnings of $228.1 in net changes in capitalization in the consolidated statement of changes in equity. The decrease in carrying value of Allied World’s non-controlling interests primarily reflected the company’s increased ownership interest in Allied World, dividends paid and the non-controlling interests’ share of Allied World’s net loss. On April 28, 2022 Allied World paid a dividend of $126.4 (April 28, 2021 - $126.4 ) to its minority shareholders. The company has the option to purchase the remaining interests of the minority shareholders in Allied World at certain dates until September 2024. (3) The increase in carrying value of Brit’s non-controlling interests during 2022 primarily related to a third party investment of $152.0 in Brit’s subsidiary Ki Insurance, partially offset by dividends paid to minority shareholders and non-controlling interests’ share of Brit’s net loss. The company has the option to purchase the interests of the minority shareholders in Brit at certain dates commencing in October 2023. (4) The decrease in carrying value of Odyssey Group’s non-controlling interests during 2022 primarily related to dividends paid to minority shareholders, partially offset by non-controlling interests’ share of Odyssey Group’s net earnings. The company has the option to purchase the interests of the minority shareholders in Odyssey Group at certain dates commencing in January 2025. (5) The decrease in carrying value of All Other non-controlling interests primarily reflected the company’s purchase of certain securities held through the company’s investment in AVLNs entered with RiverStone Barbados as described in note 7. The remaining carrying value at December 31, 2022 principally related to Fairfax Asia. (6) The decrease in carrying value of Restaurants and retail’s non-controlling interests in 2022 principally related to the privatization of Recipe as described in note 23. (7) At December 31, 2022 Fairfax India’s non-controlling interest economic ownership percentage was 65.3% (December 31, 2021 - 69.9 )% which differed from its non-controlling interest voting percentage of 5.6% (December 31, 2021 - 6.1 )%. On February 15, 2022 the company had acquired an additional 5,416,000 subordinate voting shares of Fairfax India from non-controlling interests, which was recorded in net changes in capitalization in the consolidated statement of changes in equity. At December 31, 2021 Recipe’s non-controlling interest economic ownership percentage was 61.5% which differed from its non-controlling interest voting percentage of 39.0% . (8) The decrease in carrying value of Fairfax India’s non-controlling interests during 2022 primarily reflected the non-controlling interests’ share of Fairfax India’s net unrealized foreign currency translation losses (weakening of the Indian rupee relative to the U.S. dollar), share repurchases by Fairfax India, and the acquisition by the company of additional subordinate voting shares of Fairfax India from non-controlling interests as described above in footnote (7), partially offset by non-controlling interests’ share of Fairfax India’s net earnings. |
Schedule of capitalization | 2022 2021 Common Non- Common Non- shareholders’ controlling shareholders’ controlling equity interests equity interests Privatization of Recipe (66.1) (276.2) — — Acquisition of non-controlling interests in Allied World (228.1) (466.9) — — Purchase of certain securities held through AVLNs entered with RiverStone Barbados (note 7) 14.1 (356.2) 0.3 (113.6) Third party’s investment in Brit’s subsidiary Ki Insurance — 152.0 — 124.0 Fairfax India share repurchases (9.9) (90.7) (12.5) (114.3) Sale of non-controlling interests in Odyssey Group — — 429.1 550.0 Sale of non-controlling interests in Brit — — 115.4 296.7 Initial public offerings and related capital transactions at Farmers Edge and Boat Rocker — — (3.1) 242.6 Fairfax India’s sale of an equity interest in Anchorage (note 6) — — 21.8 107.4 Other 116.4 (32.9) 1.9 134.1 As presented in net changes in capitalization in the consolidated statement of changes in equity (173.6) (1,070.9) 552.9 1,226.9 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings per Share | |
Schedule of earnings per share | 2022 2021 Net earnings attributable to shareholders of Fairfax 1,147.2 3,401.1 Preferred share dividends (45.2) (44.5) Net earnings attributable to common shareholders – basic and diluted 1,102.0 3,356.6 Weighted average common shares outstanding – basic 23,637,824 25,953,114 Share-based payment awards 1,702,599 1,503,931 Weighted average common shares outstanding – diluted 25,340,423 27,457,045 Net earnings per common share – basic $ 46.62 $ 129.33 Net earnings per common share – diluted $ 43.49 $ 122.25 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes | |
Schedule of The company's provision for (recovery of) income taxes | 2022 2021 Current income tax: Current year expense 616.8 401.6 Adjustments to prior years’ income taxes (10.0) (14.6) 606.8 387.0 Deferred income tax: Origination and reversal of temporary differences (197.1) 313.5 Adjustments to prior years’ deferred income taxes 11.7 18.9 Other 3.8 6.6 (181.6) 339.0 Provision for income taxes 425.2 726.0 |
Schedule of earnings before income taxes by jurisdiction | 2022 2021 Canada (1) U.S. (2) U.K. (3) Other (4) Total Canada (1) U.S. (2) U.K. (3) Other (4) Total Earnings (loss) before income taxes 399.2 1,330.7 (112.2) 94.3 1,712.0 858.8 974.5 157.3 2,402.0 4,392.6 Provision for (recovery of) income taxes 114.7 238.3 (12.9) 85.1 425.2 191.6 238.6 18.7 277.1 726.0 Net earnings (loss) 284.5 1,092.4 (99.3) 9.2 1,286.8 667.2 735.9 138.6 2,124.9 3,666.6 (1) Includes Fairfax India. (2) Principally comprised of Crum & Forster, Zenith National, Odyssey Group (notwithstanding that certain operations of Odyssey Group conduct business outside of the U.S.), U.S. Run-off and other associated holding company results. (3) Comprised of Brit. (4) Primarily includes companies in India, Asia and Europe (excluding the U.K.), and Allied World, which has operations in multiple jurisdictions. |
Schedule of reconciliations of the provision for (recovery of) income taxes | 2022 2021 Canadian statutory income tax rate 26.5 % 26.5 % Provision for income taxes at the Canadian statutory income tax rate 453.7 1,164.0 Non-taxable investment income (25.6) (149.4) Tax rate differential on income and losses outside Canada (50.9) (399.1) Change in unrecorded tax benefit of losses and temporary differences 0.8 67.2 Change in tax rate for deferred income taxes 6.6 0.3 Provision relating to prior years 1.7 4.3 Foreign exchange effect (17.1) (23.0) Other including permanent differences 56.0 61.7 Provision for income taxes 425.2 726.0 |
Schedule of income taxes refundable and payable | December 31, December 31, 2022 2021 Income taxes refundable 67.1 58.3 Income taxes payable (361.0) (175.0) Net income taxes payable (293.9) (116.7) |
Schedule of changes net income taxes (payable) refundable | 2022 2021 Balance - January 1 (116.7) 24.2 Amounts recorded in the consolidated statements of earnings (606.8) (387.0) Payments made during the year 416.4 288.7 Acquisitions of subsidiaries (note 23) — (54.5) Foreign exchange effect and other 13.2 11.9 Balance - December 31 (293.9) (116.7) |
Schedule of changes in net deferred income tax asset | 2022 Provision Operating for losses Provision Deferred and and loss for premium capital adjustment unearned acquisition Intangible Tax losses expenses premiums costs assets Investments credits Other Total Balance - January 1 230.0 204.2 187.7 (147.8) (413.1) (414.5) 213.6 63.5 (76.4) Amounts recorded in the consolidated statement of earnings (7.1) 53.4 27.0 (22.7) 30.9 219.4 (137.1) 17.8 181.6 Amounts recorded in total equity 8.0 — — — — 20.1 — (42.4) (14.3) Acquisitions of subsidiaries (note 23) 3.3 — — — (1.9) (11.4) — (52.6) (62.6) Deconsolidation of non-insurance subsidiaries (note 23) (0.6) — — — 7.0 — — — 6.4 Foreign exchange effect and other (6.8) (2.9) 0.2 (0.8) 1.0 15.5 (1.1) (44.4) (39.3) Balance - December 31 226.8 254.7 214.9 (171.3) (376.1) (170.9) 75.4 (58.1) (4.6) 2021 Provision Operating for losses Provision Deferred and and loss for premium capital adjustment unearned acquisition Intangible Tax losses expenses premiums costs assets Investments credits Other Total Balance - January 1 236.3 168.8 141.7 (116.1) (389.5) 23.9 174.8 117.6 357.5 Amounts recorded in the consolidated statement of earnings (3.5) 35.6 46.0 (39.4) (19.5) (339.2) 32.3 (51.3) (339.0) Amounts recorded in total equity 17.5 — — — — 0.8 — (37.5) (19.2) Acquisitions of subsidiaries (note 23) (4.2) — — 7.9 (10.3) (98.9) — 31.4 (74.1) Deconsolidation of non-insurance subsidiaries (note 23) (7.5) — — — 7.8 — — 2.3 2.6 Foreign exchange effect and other (8.6) (0.2) — (0.2) (1.6) (1.1) 6.5 1.0 (4.2) Balance - December 31 230.0 204.2 187.7 (147.8) (413.1) (414.5) 213.6 63.5 (76.4) |
Statutory Requirements (Tables)
Statutory Requirements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Statutory Requirements | |
Schedule of maximum dividend capacity available | December 31, 2022 Allied World 1,167.5 Odyssey Group 767.2 Northbridge (1) 422.2 Crum & Forster 204.6 Zenith National 91.4 2,652.9 (1) Subject to prior regulatory approval. |
Pensions and Post Retirement _2
Pensions and Post Retirement Benefits (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Pensions and Post Retirement Benefits | |
Schedule of funded status of the company's defined benefit pension and post retirement plans | The funded status of the company’s defined benefit pension and post retirement plans at December 31 were as follows: Defined benefit Defined benefit pension plans post retirement plans 2022 2021 2022 2021 Benefit obligation (715.5) (1,070.9) (66.8) (83.9) Fair value of plan assets 784.7 1,014.7 — — Funded status of plans - surplus (deficit) 69.2 (56.2) (66.8) (83.9) Impact of asset ceiling (3.6) — — — Net accrued asset (liability) (1) 65.6 (56.2) (66.8) (83.9) Weighted average assumptions used to determine benefit obligations: Discount rate 4.9 % 2.6 % 5.2 % 3.1 % Rate of compensation increase 2.5 % 2.2 % 3.8 % 3.7 % Health care cost trend — — 3.4 % 3.6 % (1) The defined benefit pension plan net accrued asset at December 31, 2022 of $65.6 (December 31, 2021 - net accrued liability of $56.2 ) was comprised of pension surpluses of $144.5 , partially offset by pension deficits of $78.9 (December 31, 2021 - pension deficits of $170.0 , partially offset by pension surpluses of $113.8 ). See notes 13 and 14. |
Schedule of pension and post retirement expenses recognized | Pension and post retirement benefit expenses recognized in the consolidated statement of earnings for the years ended December 31 were as follows: 2022 2021 Defined benefit pension plan expense 20.3 25.8 Defined contribution pension plan expense 62.2 57.8 Defined benefit post retirement plan expense 5.0 2.0 87.5 85.6 |
Schedule of pre-tax actuarial net gains (losses) recognized in the consolidated statements | Pre-tax actuarial net gains (losses) recognized in the consolidated statement of comprehensive income for the years ended December 31 were comprised as follows: 2022 2021 Defined benefit pension plans Actuarial net gains (losses) on plan assets and change in asset ceiling (157.3) 78.6 Actuarial net gains on benefit obligations 295.0 33.8 137.7 112.4 Defined benefit post retirement plans - actuarial net gains on benefit obligations 16.2 3.2 153.9 115.6 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Schedule of changes in right-of-use assets | 2022 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total Balance - January 1 328.8 431.0 759.8 396.1 611.9 1,008.0 Additions 63.7 98.2 161.9 44.0 92.0 136.0 Disposals (7.5) (8.4) (15.9) (41.2) (19.8) (61.0) Depreciation (2) (67.2) (89.9) (157.1) (68.3) (113.0) (181.3) Acquisitions of subsidiaries (note 23) — 56.7 56.7 0.9 14.1 15.0 Deconsolidation of subsidiaries (note 23) (1.1) (2.9) (4.0) (1.4) (146.7) (148.1) Foreign exchange effect and other (9.5) (23.4) (32.9) (1.3) (7.5) (8.8) Balance - December 31 (note 13) 307.2 461.3 768.5 328.8 431.0 759.8 (1) Includes Life insurance and Run-off and Corporate and Other. (2) Recorded in operating expenses and other expenses in the consolidated statement of earnings. |
Schedule of maturity profile of lease liabilities | December 31, 2022 December 31, 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total One year or less 72.7 155.8 228.5 77.4 173.6 251.0 One to two years 66.5 142.4 208.9 67.6 148.1 215.7 Two to three years 60.3 127.7 188.0 58.6 129.8 188.4 Three to four years 55.9 108.0 163.9 52.0 115.4 167.4 Four to five years 45.5 86.5 132.0 45.1 96.3 141.4 More than five years 117.7 330.2 447.9 142.8 249.6 392.4 Lease liabilities, undiscounted 418.6 950.6 1,369.2 443.5 912.8 1,356.3 Lease liabilities, discounted 364.1 729.9 1,094.0 384.2 756.5 1,140.7 Weighted average incremental borrowing rate 3.8 % 4.7 % 4.4 % 3.8 % 4.5 % 4.3 % (1) Includes Life insurance and Run-off and Corporate and Other. |
Schedule of maturity profile of finance lease receivables | December 31, 2022 December 31, 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total One year or less 2.8 55.4 58.2 2.5 62.0 64.5 One to two years 1.8 48.5 50.3 2.3 53.0 55.3 Two to three years 1.4 42.7 44.1 1.3 44.7 46.0 Three to four years 1.1 36.7 37.8 1.0 39.3 40.3 Four to five years 0.7 27.8 28.5 1.0 33.3 34.3 More than five years 2.0 43.9 45.9 2.8 64.5 67.3 Finance lease receivables, undiscounted 9.8 255.0 264.8 10.9 296.8 307.7 Unearned finance income 1.0 37.0 38.0 1.5 40.1 41.6 Finance lease receivables (note 13) 8.8 218.0 226.8 9.4 256.7 266.1 (1) Includes Life insurance and Run-off and Corporate and Other . |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Acquisitions and Divestitures | |
Schedule of amounts recognized at acquisition date for assets acquired and liabilities assumed in a business combination | Eurolife Acquisition date July 14, 2021 Percentage of common shares acquired 80.0 % (1) Assets: Insurance contract receivables 11.6 Portfolio investments 3,653.9 (2) Recoverable from reinsurers 18.6 Deferred income tax assets 32.6 Intangible assets 45.5 (3) Other assets 616.3 (4) 4,378.5 Liabilities: Accounts payable and accrued liabilities 273.2 (5) Insurance contract payables 529.0 Insurance contract liabilities 2,751.4 Deferred income tax liabilities 100.9 3,654.5 Purchase consideration 720.0 (6) Excess of fair value of net assets acquired over purchase consideration 4.0 4,378.5 (1) The transaction was recorded as the acquisition of a 100% equity interest in Eurolife with the non-controlling interests represented by a redemption liability (described in footnote 5 below) that was included in the fair value of assets acquired and liabilities assumed. (2) Includes subsidiary cash and cash equivalents of $1,433.3 . (3) Principally an intangible asset of $29.0 related to a distribution agreement with Eurobank. (4) Principally investment assets of $532.1 related to unit-linked life insurance contracts. (5) Includes a redemption liability of $124.9 on non-controlling interests as the company’s associate Eurobank may put its 20.0% equity interest in Eurolife to the company commencing in 2024 at the then fair value of that interest. (6) Comprised of cash consideration of $142.7 , a call option exercised with a fair value of $127.3 and the company’s 50.0% joint venture interest with a fair value of $450.0 . |
Financial Risk Management (Tabl
Financial Risk Management (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Financial Risk Management | |
Schedule of concentration of insurance risk by region and line of business | Canada United States Asia (1) International (2) Total (3) For the years ended December 31 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 Property 1,343.7 1,229.1 4,966.1 3,912.4 984.5 849.2 2,418.2 2,141.9 9,712.5 8,132.6 Casualty 1,243.4 1,159.0 12,004.9 10,364.0 606.6 549.8 1,823.0 1,659.5 15,677.9 13,732.3 Specialty 258.3 223.3 871.6 755.6 343.2 277.4 698.2 674.8 2,171.3 1,931.1 Total 2,845.4 2,611.4 17,842.6 15,032.0 1,934.3 1,676.4 4,939.4 4,476.2 27,561.7 23,796.0 Insurance 2,686.2 2,475.1 13,080.8 11,448.6 789.8 739.7 3,608.6 3,341.0 20,165.4 18,004.4 Reinsurance 159.2 136.3 4,761.8 3,583.4 1,144.5 936.7 1,330.8 1,135.2 7,396.3 5,791.6 2,845.4 2,611.4 17,842.6 15,032.0 1,934.3 1,676.4 4,939.4 4,476.2 27,561.7 23,796.0 (1) The Asia geographic segment is primarily comprised of countries located throughout Asia, including China, Japan, India, Sri Lanka, Malaysia, Singapore, Indonesia and South Korea, and the Middle East. (2) The International geographic segment is primarily comprised of countries located in South America, Europe, Africa and Oceania. (3) Excludes Eurolife’s life insurance operations’ gross premiums written of $350.9 in 2022 and 114.2 in 2021. Eurolife was consolidated on July 14, 2021. |
Schedule of gross credit risk exposure | December 31, December 31, 2022 2021 Cash and short term investments 10,386.0 22,795.5 Investments in debt instruments: U.S. sovereign government (1) 14,378.8 3,957.9 Other sovereign government rated AA/Aa or higher (1)(2) 2,413.5 1,074.7 All other sovereign government (3) 2,210.2 2,194.9 Canadian provincials 284.1 45.0 U.S. states and municipalities 262.7 387.2 Corporate and other (4)(5) 9,451.9 6,873.9 Receivable from counterparties to derivative contracts 256.1 158.9 Insurance contract receivables 7,907.5 6,883.2 Recoverable from reinsurers 13,115.8 12,090.5 Other assets (6) 2,024.6 1,881.3 Total gross credit risk exposure 62,691.2 58,343.0 (1) Represented together 30.3% of the company’s total investment portfolio at December 31, 2022 (December 31, 2021 - 9.5% ) and considered by the company to have nominal credit risk. (2) Comprised primarily of bonds issued by the governments of Canada, the United Kingdom and Singapore with fair values at December 31, 2022 of $1,923.5 , $180.6 and $91.3 respectively (December 31, 2021 - $614.6 , $7.7 and $95.1 ). (3) Comprised primarily of bonds issued by the governments of Brazil, Greece, Spain and Poland with fair values at December 31, 2022 of $744.2 , $690.1 , $216.2 and $126.9 respectively (December 31, 2021 - $415.4 , $844.7 , $297.5 , and $78.5 ). (4) Represents 17.0% of the company’s total investment portfolio at December 31, 2022 compared to 13.0% at December 31, 2021, with the increase principally related to net purchases of short to mid-dated high quality corporate bonds of $ 2,331.9 and net purchases of unrated first mortgage loans of $870.2 . (5) Includes the company’s investments in first mortgage loans at December 31, 2022 of $2,500.7 (December 31, 2021 - $1,659.4 ) secured by real estate predominantly in the U.S., Europe and Canada as described in note 5. (6) Excludes assets associated with unit-linked insurance products of $676.5 at December 31, 2022 (December 31, 2021 – $637.1 ) for which credit risk is not borne by the company, and income taxes refundable of $67.1 at December 31, 2022 (December 31, 2021 - $58.3 ) that are considered to have nominal credit risk. |
Schedule of investments in debt instruments | December 31, 2022 December 31, 2021 Amortized Fair Amortized Fair Issuer Credit Rating cost value % cost value % AAA/Aaa 17,119.4 16,721.6 57.7 5,248.2 5,237.3 36.1 AA/Aa 858.3 847.6 2.9 435.0 437.7 3.0 A/A 2,409.6 2,330.6 8.0 1,838.4 1,865.5 12.8 BBB/Baa 3,410.3 3,348.7 11.5 1,749.9 1,914.6 13.2 BB/Ba 2,114.9 1,917.2 6.6 1,840.9 1,808.3 12.4 B/B 48.2 49.6 0.2 115.0 114.8 0.8 Lower than B/B 79.7 80.0 0.3 58.4 62.9 0.4 Unrated (1)(2) 3,928.2 3,705.9 12.8 2,935.3 3,092.5 21.3 Total 29,968.6 29,001.2 100.0 14,221.1 14,533.6 100.0 (1) Comprised primarily of the fair value of the company’s investments in Blackberry Limited of $285.0 (December 31, 2021 - $535.1 ), JAB Pet Holdings Ltd. of $239.1 (December 31, 2021 - nil ) and Mosaic Capital of $81.7 (December 31, 2021 – $129.3 ). (2) Includes the company’s investments in first mortgage loans at December 31, 2022 of $2,500.7 (December 31, 2021 - $1,659.4 ) secured by real estate predominantly in the U.S., Europe and Canada, with weighted average loan-to-value ratio of approximately 60% , reducing the company’s credit risk exposure related to these investments. |
Schedule of credit risk related to derivative contract counterparties | December 31, December 31, 2022 2021 Total derivative assets (1) 256.1 158.9 Obligations that may be offset under net settlement arrangements (33.0) (9.6) Fair value of collateral deposited for the benefit of the company (2) (216.0) (116.5) Excess collateral pledged by the company in favour of counterparties 4.6 4.8 Net derivative counterparty exposure after net settlement and collateral arrangements 11.7 37.6 (1) Excludes equity warrants, equity call options, AVLNs entered with RiverStone Barbados and other derivatives which are not subject to counterparty risk. (2) Excludes excess collateral pledged by counterparties of $68.4 at December 31, 2022 (December 31, 2021 - $22.5 ). |
Schedule of gross recoverable from reinsurers | December 31, 2022 December 31, 2021 Outstanding Outstanding Gross balances for Net unsecured Gross balances for Net unsecured recoverable which security recoverable recoverable which security recoverable A.M. Best Rating (or S&P equivalent) from reinsurers is held from reinsurers from reinsurers is held from reinsurers A++ 600.3 24.2 576.1 568.2 27.2 541.0 A+ 6,631.3 444.1 6,187.2 5,905.9 494.4 5,411.5 A 3,750.9 205.9 3,545.0 3,899.8 227.3 3,672.5 A- 478.4 53.6 424.8 371.9 43.9 328.0 B++ 55.3 4.3 51.0 50.8 4.6 46.2 B+ 0.8 — 0.8 0.5 0.3 0.2 B or lower 10.6 — 10.6 20.2 0.1 20.1 Not rated 998.8 506.5 492.3 1,004.0 576.7 427.3 Pools and associations 761.3 6.6 754.7 447.9 7.1 440.8 13,287.7 1,245.2 12,042.5 12,269.2 1,381.6 10,887.6 Provision for uncollectible reinsurance (171.9) (171.9) (178.7) (178.7) Recoverable from reinsurers 13,115.8 11,870.6 12,090.5 10,708.9 |
Schedule of maturity profile of the financial and insurance liabilities | December 31, 2022 3 months 3 months More than or less to 1 year 1 - 3 years 3 - 5 years 5 years Total Accounts payable and accrued liabilities (1) 1,521.1 1,158.4 1,090.7 395.9 564.7 4,730.8 Insurance contract payables (2) 939.9 2,600.7 242.2 39.5 661.2 4,483.5 Provision for losses and loss adjustment expenses 3,428.6 8,506.6 10,944.1 5,965.6 9,474.3 38,319.2 Provision for life policy benefits 45.5 161.0 455.6 631.8 1,235.8 2,529.7 Borrowings - holding company and insurance and reinsurance companies: Principal 0.1 0.2 1,051.4 904.2 4,704.4 6,660.3 Interest 84.3 209.2 567.0 462.2 598.9 1,921.6 Borrowings - non-insurance companies: Principal 254.5 117.3 781.9 61.3 798.2 2,013.2 Interest 26.9 69.0 148.6 83.6 83.1 411.2 6,300.9 12,822.4 15,281.5 8,544.1 18,120.6 61,069.5 December 31, 2021 3 months 3 months More than or less to 1 year 1 - 3 years 3 - 5 years 5 years Total Accounts payable and accrued liabilities (1) 1,586.6 821.6 1,131.3 399.1 519.7 4,458.3 Insurance contract payables (2) 1,026.7 1,970.0 346.4 16.1 611.6 3,970.8 Provision for losses and loss adjustment expenses 2,925.1 7,033.9 10,662.4 5,391.2 8,410.2 34,422.8 Provision for life policy benefits 72.0 162.7 585.0 575.7 1,280.4 2,675.8 Borrowings - holding company and insurance and reinsurance companies: Principal 0.1 0.2 283.1 1,270.8 4,614.8 6,169.0 Interest 66.0 193.8 520.0 445.6 584.9 1,810.3 Borrowings - non-insurance companies: Principal 512.2 72.2 270.8 41.3 736.8 1,633.3 Interest 38.3 35.9 99.8 78.9 114.9 367.8 6,227.0 10,290.3 13,898.8 8,218.7 16,873.3 55,508.1 (1) Excludes pension and post retirement liabilities (note 21), deferred gift card, hospitality and other revenue, accrued interest expense and other. The maturity profile of lease liabilities included in the table above is presented in note 22. (2) Excludes ceded deferred premium acquisition costs. |
Schedule of maturity profile of the derivative obligations | December 31, 2022 December 31, 2021 3 months 3 months More than 3 months 3 months More than or less to 1 year 1 year Total or less to 1 year 1 year Total Equity total return swaps - long positions 19.1 0.3 — 19.4 1.8 0.1 — 1.9 Foreign currency forward and swap contracts 51.1 5.0 50.7 106.8 26.4 5.0 46.0 77.4 Other derivative contracts 25.6 38.5 0.7 64.8 46.5 26.7 0.4 73.6 95.8 43.8 51.4 191.0 74.7 31.8 46.4 152.9 |
Schedule of potential impact of changes in interest rates on fixed income portfolio | December 31, 2022 December 31, 2021 Fair value of Hypothetical Hypothetical Fair value of Hypothetical Hypothetical fixed income change in net % change fixed income change in net % change portfolio earnings (1) in fair value (1) portfolio earnings (1) in fair value (1) Change in interest rates 200 basis point increase 27,944.0 (852.9) (3.7) 13,984.0 (418.4) (3.8) 100 basis point increase 28,461.5 (435.4) (1.9) 14,239.6 (224.3) (2.0) No change 29,001.2 — — 14,533.6 — — 100 basis point decrease 29,616.2 496.4 2.1 14,900.9 280.6 2.5 200 basis point decrease 30,289.0 1,039.7 4.4 15,327.9 607.5 5.5 (1) Includes the impact of forward contracts to sell long dated U.S. treasury bonds with a notional amount at December 31, 2022 of $183.7 (December 31, 2021 - $1,691.3 ). |
Schedule of net equity exposures and financial effects | Year ended Year ended December 31, December 31, December 31, 2022 December 31, 2021 2022 2021 Exposure/ Exposure/ Pre-tax Pre-tax Notional Carrying Notional Carrying earnings earnings amount value amount value (loss) (loss) Long equity exposures: Common stocks 5,234.4 5,234.4 5,845.5 5,845.5 (242.7) 1,333.4 Preferred stocks – convertible (1) 44.2 44.2 54.5 54.5 (4.4) 2.8 Bonds – convertible 414.5 414.5 583.4 583.4 (237.0) 101.3 Investments in associates (1)(2)(3) 8,183.3 6,786.6 7,192.1 5,496.6 45.1 52.7 Sale and deconsolidation of non-insurance subsidiaries (4) — — — — 4.4 190.3 Equity derivatives (5) 2,076.0 269.4 2,590.2 455.3 190.8 631.6 Long equity exposures and financial effects 15,952.4 12,749.1 16,265.7 12,435.3 (243.8) 2,312.1 (1) Excludes the company’s insurance and reinsurance investments in associates and joint ventures and certain other equity and equity-related holdings which are considered long term strategic holdings. See note 6. (2) Pre-tax earnings (loss) excludes share of profit (loss) of associates, and includes gain (loss) on sale of non-insurance associates and joint ventures. (3) During 2021 the company sold a portion of its investment in IIFL Finance for cash proceeds of $113.7 ( 8.6 billion Indian rupees) and recorded a net realized gain of $42.0 in the consolidated statement of earnings as described in note 6. (4) Principally comprised of the sale of Toys “R” Us Canada, the privatization of Mosaic Capital and Fairfax India’s sale of Privi during 2021. (5) Includes net gains on investments of $255.4 (2021 - $222.7 ) recognized on the company’s investment in long equity total return swaps on Fairfax subordinate voting shares. |
Schedule of potential impact on net earnings due to changes in global equity markets | December 31, 2022 Change in global equity markets 20% increase 10% increase No change 10% decrease 20% decrease Fair value of equity and equity-related holdings 9,297.5 8,531.9 7,769.1 7,010.3 6,258.5 Hypothetical $ change in net earnings 1,301.9 649.8 — (646.8) (1,287.8) Hypothetical % change in fair value 19.7 9.8 — (9.8) (19.4) December 31, 2021 Change in global equity markets 20% increase 10% increase No change 10% decrease 20% decrease Fair value of equity and equity-related holdings 10,861.1 9,966.1 9,073.6 8,184.4 7,297.3 Hypothetical $ change in net earnings 1,549.7 773.5 — (770.6) (1,538.8) Hypothetical % change in fair value 19.7 9.8 — (9.8) (19.6) |
Schedule of pre-tax foreign exchange effects included in net gains (losses) on investments | The pre-tax foreign exchange effects included in net gains (losses) on investments in the company’s consolidated statements of earnings for the years ended December 31 were as follows: 2022 2021 Net gains (losses) on investments: Investing activities (366.5) (122.3) Underwriting activities 8.6 41.2 Foreign currency contracts 53.6 (12.0) Foreign currency net losses (304.3) (93.1) |
Schedule of foreign currency effects on the consolidated statement of earnings | Foreign currency effects on the consolidated statement of earnings British Canadian dollar Euro pound sterling Indian rupee 2022 2021 2022 2021 2022 2021 2022 2021 Assets 1,751.0 1,863.4 1,033.2 905.5 1,739.4 1,748.6 1,872.9 2,795.0 Liabilities (791.0) (671.6) (1,275.4) (1,134.2) (2,252.8) (2,156.6) (252.9) (273.7) Net asset exposure before hedge of net investment 960.0 1,191.8 (242.2) (228.7) (513.4) (408.0) 1,620.0 2,521.3 Notional long (short) amount of foreign currency forward contracts (1,258.2) (1,251.2) (208.7) (84.9) 87.0 (8.4) 3.4 4.2 Net asset (liability) exposure after foreign currency forward contracts (298.2) (59.4) (450.9) (313.6) (426.4) (416.4) 1,623.4 2,525.5 Hypothetical change in pre-tax earnings (loss) 29.8 5.9 45.1 31.4 42.6 41.6 (162.3) (252.6) Hypothetical change in net earnings (loss) 23.7 1.7 36.6 26.9 37.6 35.5 (161.2) (235.8) |
Schedule of foreign currency effects on the consolidated statement of other comprehensive income | Foreign currency effects on the consolidated statement of other comprehensive income British Canadian dollar Euro pound sterling Indian rupee 2022 2021 2022 2021 2022 2021 2022 2021 Assets 11,055.5 11,028.6 8,269.4 7,549.2 1,783.3 1,793.8 3,697.6 3,663.6 Liabilities (7,129.0) (6,719.6) (6,844.3) (6,066.3) (1,339.1) (1,292.7) (1,251.3) (1,184.8) Net asset exposure before hedge of net investment 3,926.5 4,309.0 1,425.1 1,482.9 444.2 501.1 2,446.3 2,478.8 Hedge of net investment (2,057.7) (2,205.5) (792.2) (842.4) — — — — Net asset exposure after hedge of net investment 1,868.8 2,103.5 632.9 640.5 444.2 501.1 2,446.3 2,478.8 Hypothetical change in pre-tax other comprehensive income (loss) (186.9) (210.4) (63.3) (64.1) (44.4) (50.1) (244.6) (247.9) Hypothetical change in other comprehensive income (loss) (181.3) (209.3) (35.7) (40.0) (43.5) (49.1) (228.0) (230.5) |
Schedule of capital management | Excluding consolidated non- Consolidated insurance companies December 31, December 31, December 31, December 31, 2022 2021 2022 2021 Holding company cash and investments (net of derivative obligations) 1,326.4 1,446.2 1,326.4 1,446.2 Borrowings – holding company 5,887.6 5,338.6 5,887.6 5,338.6 Borrowings – insurance and reinsurance companies 733.4 790.7 733.4 790.7 Borrowings – non-insurance companies 2,003.9 1,623.7 — — Total debt 8,624.9 7,753.0 6,621.0 6,129.3 Net debt (1) 7,298.5 6,306.8 5,294.6 4,683.1 Common shareholders’ equity 15,340.7 15,049.6 15,340.7 15,049.6 Preferred stock 1,335.5 1,335.5 1,335.5 1,335.5 Non-controlling interests 3,659.6 4,930.2 1,969.2 2,931.4 Total equity 20,335.8 21,315.3 18,645.4 19,316.5 Net debt/total equity 35.9 % 29.6 % 28.4 % 24.2 % Net debt/net total capital (2) 26.4 % 22.8 % 22.1 % 19.5 % Total debt/total capital (3) 29.8 % 26.7 % 26.2 % 24.1 % Interest coverage (4) 5.2x 10.6x 5.9x (6) 13.0x (6) Interest and preferred share dividend distribution coverage (5) 4.5x 9.4x 4.9x (6) 11.1x (6) (1) Net debt is calculated by the company as total debt less holding company cash and investments (net of derivative obligations). (2) Net total capital is calculated by the company as the sum of total equity and net debt. (3) Total capital is calculated by the company as the sum of total equity and total debt. (4) Interest coverage is calculated by the company as earnings (loss) before income taxes and interest expense on borrowings, divided by interest expense on borrowings. (5) Interest and preferred share dividend distribution coverage is calculated by the company as earnings (loss) before income taxes and interest expense on borrowings divided by the sum of interest expense on borrowings and preferred share dividend distributions adjusted to a pre-tax equivalent at the company’s Canadian statutory income tax rate. (6) Excludes earnings (loss) before income taxes, and interest expense on borrowings, of consolidated non-insurance companies. |
Segmented Information (Tables)
Segmented Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segmented Information | |
Schedule of earnings by reporting segment | 2022 Property and Casualty Insurance and Reinsurance Life North Global International insurance Non- Eliminations American Insurers and Insurers and and insurance Corporate and Insurers Reinsurers Reinsurers Total Run-off companies and Other adjustments Consolidated Gross premiums written External 7,600.9 16,995.6 2,965.2 27,561.7 350.9 — — — 27,912.6 Intercompany 49.6 101.0 213.4 364.0 — — — (364.0) — 7,650.5 17,096.6 3,178.6 27,925.7 350.9 — — (364.0) 27,912.6 Net premiums written 6,457.6 13,506.3 1,963.1 21,927.0 344.7 — — — 22,271.7 Net premiums earned External 6,140.8 12,851.5 1,671.4 20,663.7 342.4 — — — 21,006.1 Intercompany (33.0) (124.6) 157.6 — — — — — — 6,107.8 12,726.9 1,829.0 20,663.7 342.4 — — — 21,006.1 Underwriting expenses (1) (5,674.8) (12,067.9) (1,815.7) (19,558.4) (509.7) — — 0.5 (20,067.6) Underwriting profit (loss) 433.0 659.0 13.3 1,105.3 (167.3) — — 0.5 938.5 Interest income 249.0 447.8 99.0 795.8 56.4 10.2 11.8 (0.7) 873.5 Dividends 32.0 54.9 16.0 102.9 12.3 24.6 0.6 — 140.4 Investment expenses (47.0) (89.4) (16.2) (152.6) (13.1) (8.2) (2.8) 124.6 (52.1) Interest and dividends 234.0 413.3 98.8 746.1 55.6 26.6 9.6 123.9 961.8 Share of profit of associates 239.8 429.3 52.4 721.5 56.4 134.0 102.8 — 1,014.7 Other Revenue — — — — — 5,581.6 — — 5,581.6 Expenses — — — — — (5,520.9) — — (5,520.9) — — — — — 60.7 — — 60.7 Operating income (loss) 906.8 1,501.6 164.5 2,572.9 (55.3) 221.3 112.4 124.4 2,975.7 Net gains (losses) on investments (397.7) (1,151.1) (211.1) (1,759.9) (306.5) 71.4 261.1 — (1,733.9) Gain on sale and consolidation of insurance subsidiaries (note 23) 1,213.2 — 6.5 1,219.7 — — — — 1,219.7 Interest expense (5.7) (51.1) (3.0) (59.8) (13.2) (122.8) (257.2) 0.2 (452.8) Corporate overhead and other (39.8) (98.9) (12.1) (150.8) (1.4) — (19.9) (124.6) (296.7) Pre-tax income (loss) 1,676.8 200.5 (55.2) 1,822.1 (376.4) 169.9 96.4 — 1,712.0 Provision for income taxes (425.2) Net earnings 1,286.8 Attributable to: Shareholders of Fairfax 1,147.2 Non-controlling interests 139.6 1,286.8 (1) Property and casualty insurance and reinsurance underwriting expenses for the year ended December 31, 2022 were comprised as shown below. Accident year underwriting expenses exclude the impact of favourable or adverse prior year claims reserve development. Property and Casualty Insurance and Reinsurance North Global International American Insurers and Insurers and Insurers Reinsurers Reinsurers Total Loss & LAE - accident year 3,733.4 8,715.7 1,207.3 13,656.4 Commissions 998.3 2,109.5 324.4 3,432.2 Other underwriting expenses 1,020.3 1,263.8 381.9 2,666.0 Underwriting expenses - accident year 5,752.0 12,089.0 1,913.6 19,754.6 Net favourable claims reserve development (77.2) (21.1) (97.9) (196.2) Underwriting expenses - calendar year 5,674.8 12,067.9 1,815.7 19,558.4 2021 Property and Casualty Insurance and Reinsurance North Global International Life insurance Non- Eliminations American Insurers and Insurers and and insurance Corporate and Insurers Reinsurers Reinsurers Total Run-off companies and Other adjustments Consolidated Gross premiums written External 6,544.6 14,567.6 2,683.8 23,796.0 114.2 — — — 23,910.2 Intercompany 34.2 93.8 169.5 297.5 358.1 — — (655.6) — 6,578.8 14,661.4 2,853.3 24,093.5 472.3 — — (655.6) 23,910.2 Net premiums written 5,319.7 10,755.5 1,734.2 17,809.4 468.7 — — — 18,278.1 Net premiums earned External 5,435.3 9,530.6 1,482.4 16,448.3 109.7 — — — 16,558.0 Intercompany (410.5) (78.8) 131.2 (358.1) 358.1 — — — — 5,024.8 9,451.8 1,613.6 16,090.2 467.8 — — — 16,558.0 Underwriting expenses (2) (4,637.9) (9,077.6) (1,573.5) (15,289.0) (776.8) — — 0.3 (16,065.5) Underwriting profit (loss) 386.9 374.2 40.1 801.2 (309.0) — — 0.3 492.5 Interest income 154.4 299.6 66.8 520.8 22.2 3.9 28.2 (6.7) 568.4 Dividends 23.9 37.2 11.6 72.7 7.8 28.5 (0.8) — 108.2 Investment expenses (43.2) (100.1) (8.5) (151.8) (10.7) (127.1) (2.8) 256.6 (35.8) Interest and dividends 135.1 236.7 69.9 441.7 19.3 (94.7) 24.6 249.9 640.8 Share of profit of associates 103.6 184.8 35.7 324.1 16.8 22.3 38.8 — 402.0 Other Revenue — — — — — 5,157.5 — 0.5 5,158.0 Expenses — — — — — (5,092.1) — 5.2 (5,086.9) — — — — — 65.4 — 5.7 71.1 Operating income (loss) 625.6 795.7 145.7 1,567.0 (272.9) (7.0) 63.4 255.9 1,606.4 Net gains on investments (1) 518.5 604.1 1,521.9 2,644.5 69.7 266.0 464.9 — 3,445.1 Gain on sale and consolidation of insurance subsidiaries (note 23) — 68.7 64.8 133.5 — — 130.5 — 264.0 Interest expense (8.6) (50.5) (2.4) (61.5) (7.9) (140.3) (305.4) 1.2 (513.9) Corporate overhead and other (53.7) (88.0) (22.3) (164.0) (38.4) — 50.0 (256.6) (409.0) Pre-tax income (loss) 1,081.8 1,330.0 1,707.7 4,119.5 (249.5) 118.7 403.4 0.5 4,392.6 Provision for income taxes (726.0) Net earnings 3,666.6 Attributable to: Shareholders of Fairfax 3,401.1 Non-controlling interests 265.5 3,666.6 (1) Includes net gains on deconsolidation of non-insurance subsidiaries primarily related to the deconsolidation of Fairfax India’s subsidiary Privi of $94.9 and Toys “R” Us Canada of $85.7 as described in note 23. (2) Property and casualty insurance and reinsurance underwriting expenses for the year ended December 31, 2021 were comprised as shown below. Accident year underwriting expenses exclude the impact of favourable or adverse prior year claims reserve development. Property and Casualty Insurance and Reinsurance North Global International American Insurers and Insurers and Insurers Reinsurers Reinsurers Total Loss & LAE - accident year 2,900.3 6,551.6 986.6 10,438.5 Commissions 913.6 1,571.0 289.6 2,774.2 Other underwriting expenses 927.7 1,156.4 347.8 2,431.9 Underwriting expenses - accident year 4,741.6 9,279.0 1,624.0 15,644.6 Net favourable claims reserve development (103.7) (201.4) (50.5) (355.6) Underwriting expenses - calendar year 4,637.9 9,077.6 1,573.5 15,289.0 |
Schedule of investments in associates, segment assets and segment liabilities, and additions to goodwill by reporting segment | Investments in associates Additions to goodwill Segment assets Segment liabilities 2022 2021 2022 2021 2022 2021 2022 2021 Property and Casualty Insurance and Reinsurance North American Insurers 1,217.7 801.5 — — 18,664.9 17,418.7 12,890.0 11,551.5 Global Insurers and Reinsurers 2,893.3 2,168.7 — 16.4 51,634.9 46,849.3 39,086.8 34,266.7 International Insurers and Reinsurers 592.0 415.2 — — 9,547.2 9,616.9 5,631.9 5,700.7 4,703.0 3,385.4 — 16.4 79,847.0 73,884.9 57,608.7 51,518.9 Life insurance and Run-off 348.1 272.6 0.4 — 6,087.7 6,669.1 5,289.5 5,781.1 Non-insurance companies 1,378.5 1,379.7 151.6 44.3 8,611.4 7,856.4 4,820.6 4,075.1 Corporate and Other and eliminations and adjustments 1,004.3 1,066.3 — — (2,421.0) (1,765.0) 4,070.5 3,955.0 Consolidated 7,433.9 6,104.0 152.0 60.7 92,125.1 86,645.4 71,789.3 65,330.1 |
Schedule of net premiums earned by product line | Net premiums earned by product line for the years ended December 31 were as follows: Property Casualty Specialty (1) Total 2022 2021 2022 2021 2022 2021 2022 2021 Property and Casualty Insurance and Reinsurance - net premiums earned North American Insurers 1,379.3 1,209.6 4,284.3 3,400.2 444.2 415.0 6,107.8 5,024.8 Global Insurers and Reinsurers 4,895.5 3,876.9 6,866.2 4,856.8 965.2 718.1 12,726.9 9,451.8 International Insurers and Reinsurers 919.9 834.9 615.1 544.3 294.0 234.4 1,829.0 1,613.6 7,194.7 5,921.4 11,765.6 8,801.3 1,703.4 1,367.5 20,663.7 16,090.2 Life insurance and Run-off (1) — 8.2 0.5 348.8 341.9 110.8 342.4 467.8 Consolidated net premiums earned 7,194.7 5,929.6 11,766.1 9,150.1 2,045.3 1,478.3 21,006.1 16,558.0 Interest and dividends 961.8 640.8 Share of profit of associates 1,014.7 402.0 Net gains (losses) on investments (1,733.9) 3,445.1 Gain on sale and consolidation of insurance subsidiaries (note 23) 1,219.7 264.0 Other revenue 5,581.6 5,158.0 Consolidated income 28,050.0 26,467.9 Distribution of net premiums earned 34.3 % 35.8 % 56.0 % 55.3 % 9.7 % 8.9 % 100.0 % 100.0 % (1) Includes Eurolife’s life insurance operations since Eurolife’s consolidation on July 14, 2021, as described in note 23. |
Schedule of net premiums earned by geographic region | Net premiums earned by geographic region for the years ended December 31 were as follows: Canada United States Asia (1) International (2) Total 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 Property and Casualty Insurance and Reinsurance - net premiums earned North American Insurers 1,914.1 1,784.9 4,157.5 3,222.1 1.4 1.2 34.8 16.6 6,107.8 5,024.8 Global Insurers and Reinsurers 378.8 293.1 9,337.3 6,671.4 878.1 806.9 2,132.7 1,680.4 12,726.9 9,451.8 International Insurers and Reinsurers 0.6 0.2 122.4 81.8 551.9 438.9 1,154.1 1,092.7 1,829.0 1,613.6 2,293.5 2,078.2 13,617.2 9,975.3 1,431.4 1,247.0 3,321.6 2,789.7 20,663.7 16,090.2 Life insurance and Run-off (3) — — 0.5 358.1 — — 341.9 109.7 342.4 467.8 Consolidated net premiums earned 2,293.5 2,078.2 13,617.7 10,333.4 1,431.4 1,247.0 3,663.5 2,899.4 21,006.1 16,558.0 Interest and dividends 961.8 640.8 Share of profit of associates 1,014.7 402.0 Net gains (losses) on investments (1,733.9) 3,445.1 Gain on sale and consolidation of insurance subsidiaries (note 23) 1,219.7 264.0 Other revenue 5,581.6 5,158.0 Consolidated income 28,050.0 26,467.9 Distribution of net premiums earned 10.9 % 12.6 % 64.9 % 62.4 % 6.8 % 7.5 % 17.4 % 17.5 % 100.0% 100.0% (1) The Asia geographic segment is primarily comprised of countries located throughout Asia, including China, Japan, India, Sri Lanka, Malaysia, Singapore, Indonesia and South Korea, and the Middle East. (2) The International geographic segment is primarily comprised of countries located in South America, Europe, Africa and Oceania. (3) Includes Eurolife’s life insurance operations since Eurolife’s consolidation on July 14, 2021, as described in note 23. |
Schedule of revenue and expenses of the non-insurance companies | Restaurants and retail Fairfax India (1) Thomas Cook India (2) Other (3) Total 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 Revenue 1,710.3 1,803.8 216.7 228.2 611.0 249.4 3,043.6 2,876.1 5,581.6 5,157.5 Expenses (1,582.2) (1,724.8) (208.1) (206.9) (600.8) (293.4) (3,129.8) (2,867.0) (5,520.9) (5,092.1) Pre-tax income (loss) before interest expense and other (4) 128.1 79.0 8.6 21.3 10.2 (44.0) (86.2) 9.1 60.7 65.4 Interest and dividends 9.9 7.5 21.4 (102.2) — (0.1) (4.7) 0.1 26.6 (94.7) Share of profit (loss) of associates (0.1) — 132.0 20.2 0.3 (0.1) 1.8 2.2 134.0 22.3 Operating income (loss) 137.9 86.5 162.0 (60.7) 10.5 (44.2) (89.1) 11.4 221.3 (7.0) (1) These results differ from those published by Fairfax India primarily due to Fairfax India’s application of investment entity accounting under IFRS. (2) These results differ from those published by Thomas Cook India primarily due to differences between IFRS and Ind AS, and acquisition accounting adjustments. (3) Included in Expenses is a non-cash goodwill impairment charge on Farmers Edge of $133.4 recognized in 2022. (4) Excludes interest and dividends, share of profit (loss) of associates and net gains (losses) on investments. |
Schedule of segmented balance sheet | December 31, 2022 December 31, 2021 Property Property and and casualty Life casualty Life insurance and insurance Non- Corporate insurance and insurance Non- Corporate reinsurance and insurance and reinsurance and insurance and companies Run-off companies eliminations (4) Consolidated companies Run-off companies eliminations (4) Consolidated Assets Holding company cash and investments 316.6 — — 1,029.2 1,345.8 604.5 — — 873.8 1,478.3 Insurance contract receivables 8,310.9 28.2 — (431.6) 7,907.5 7,215.5 7.8 — (340.1) 6,883.2 Portfolio investments (1) 49,038.8 4,275.4 2,119.3 (1,110.6) 54,322.9 45,061.8 4,963.9 2,252.8 (581.1) 51,697.4 Deferred premium acquisition costs 2,201.3 7.5 — (38.5) 2,170.3 1,950.6 3.8 — (30.3) 1,924.1 Recoverable from reinsurers 14,097.9 517.5 — (1,499.6) 13,115.8 13,060.3 457.6 — (1,427.4) 12,090.5 Deferred income tax assets 337.3 25.6 54.5 74.7 492.1 268.2 29.0 66.9 158.3 522.4 Goodwill and intangible assets 3,396.8 7.5 2,284.4 0.3 5,689.0 3,579.5 7.5 2,341.2 — 5,928.2 Due from affiliates 206.3 364.1 — (570.4) — 231.3 360.2 — (591.5) — Other assets 1,774.0 832.6 4,153.2 321.9 7,081.7 1,746.0 810.0 3,195.5 369.8 6,121.3 Investments in affiliates (2) 167.1 29.3 — (196.4) — 167.2 29.3 — (196.5) — Total assets 79,847.0 6,087.7 8,611.4 (2,421.0) 92,125.1 73,884.9 6,669.1 7,856.4 (1,765.0) 86,645.4 Liabilities Accounts payable and accrued liabilities 2,304.9 263.1 2,430.7 216.5 5,215.2 2,149.9 233.4 2,077.4 524.7 4,985.4 Derivative obligations 113.5 — 58.2 19.3 191.0 72.5 — 47.9 32.5 152.9 Due to affiliates 16.5 0.4 82.4 (99.3) — 28.8 0.2 135.1 (164.1) — Deferred income tax liabilities 225.0 18.5 252.4 0.8 496.7 322.2 72.9 198.5 5.2 598.8 Insurance contract payables 4,839.7 688.4 — (466.2) 5,061.9 4,208.6 652.0 — (367.1) 4,493.5 Provision for losses and loss adjustment expenses (3) 37,531.7 4,300.9 — (1,343.0) 40,489.6 33,381.4 4,806.1 — (1,295.2) 36,892.3 Provision for unearned premiums (3) 11,844.0 18.2 — (152.2) 11,710.0 10,564.8 16.5 — (127.1) 10,454.2 Borrowings 733.4 — 1,996.9 5,894.6 8,624.9 790.7 — 1,616.2 5,346.1 7,753.0 Total liabilities 57,608.7 5,289.5 4,820.6 4,070.5 71,789.3 51,518.9 5,781.1 4,075.1 3,955.0 65,330.1 Equity Shareholders’ equity attributable to shareholders of Fairfax 20,269.1 798.2 2,100.4 (6,491.5) 16,676.2 19,778.9 888.0 1,782.5 (6,064.3) 16,385.1 Non-controlling interests 1,969.2 — 1,690.4 — 3,659.6 2,587.1 — 1,998.8 344.3 4,930.2 Total equity 22,238.3 798.2 3,790.8 (6,491.5) 20,335.8 22,366.0 888.0 3,781.3 (5,720.0) 21,315.3 Total liabilities and total equity 79,847.0 6,087.7 8,611.4 (2,421.0) 92,125.1 73,884.9 6,669.1 7,856.4 (1,765.0) 86,645.4 (1) Includes intercompany investments in Fairfax non-insurance subsidiaries carried at cost that are eliminated on consolidation. (2) Intercompany investments in Fairfax insurance and reinsurance subsidiaries carried at cost that are eliminated on consolidation. (3) Included in insurance contract liabilities on the consolidated balance sheet. (4) Corporate and eliminations includes the Fairfax holding company, subsidiary intermediate holding companies, and consolidating and eliminating entries. The most significant of those entries are the elimination of intercompany reinsurance provided by Group Re, and reinsurance provided by Odyssey Group and Allied World to affiliated primary insurers. |
Expenses (Tables)
Expenses (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Expenses | |
Schedule of losses on claims, net, operating expenses and other expenses | Losses on claims, net, operating expenses and other expenses for the years ended December 31 were comprised as follows: 2022 2021 Insurance Insurance and Non- and Non- reinsurance insurance reinsurance insurance companies (1) companies Total companies (1) companies Total Losses and loss adjustment expenses, property and casualty 13,169.1 — 13,169.1 10,272.9 — 10,272.9 Provisions and claims, Eurolife 251.1 — 251.1 81.0 — 81.0 Cost of sales — 3,349.4 3,349.4 — 2,987.5 2,987.5 Wages and salaries 1,580.8 877.5 2,458.3 1,547.1 761.3 2,308.4 Depreciation, amortization and impairment charges 233.2 450.4 683.6 291.0 639.4 930.4 Employee benefits 381.3 125.9 507.2 345.3 116.9 462.2 Premium taxes 306.8 — 306.8 285.9 — 285.9 Information technology costs 254.7 44.5 299.2 216.3 40.7 257.0 Audit, legal and tax professional fees 189.1 53.7 242.8 159.7 43.4 203.1 Repairs, maintenance and utilities 14.4 163.9 178.3 13.2 144.2 157.4 Shipping and delivery 1.3 152.8 154.1 1.2 120.0 121.2 Share-based payments to directors and employees 131.5 20.4 151.9 118.2 18.3 136.5 Marketing costs 38.9 76.6 115.5 33.4 70.1 103.5 Administrative expense and other 357.2 205.8 563.0 321.4 145.1 466.5 Losses on claims, net, operating expenses and other expenses (2)(3) 16,909.4 5,520.9 22,430.3 13,686.6 5,086.9 18,773.5 Commissions, net (note 9) (4) 3,454.9 — 3,454.9 2,787.9 — 2,787.9 Interest expense (note 15) (4) 330.0 122.8 452.8 373.6 140.3 513.9 20,694.3 5,643.7 26,338.0 16,848.1 5,227.2 22,075.3 (1) Includes Life insurance and Run-off and Corporate and Other. (2) Expenses of the insurance and reinsurance companies, excluding commissions, net and interest expense, are included in losses on claims, net and operating expenses in the consolidated statement of earnings. (3) Expenses of the non-insurance companies, excluding commissions, net and interest expense, are included in other expenses in the consolidated statement of earnings. (4) Presented as separate lines in the consolidated statement of earnings. |
Supplementary Cash Flow Infor_2
Supplementary Cash Flow Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Supplementary Cash Flow Information | |
Schedule of supplemental balance sheet disclosures | December 31, 2022 Unrestricted cash and cash equivalents included in the Cash and cash equivalents included on consolidated statement of cash flows Restricted cash and cash equivalents the consolidated balance sheet Cash Cash Cash Cash equivalents Total Cash equivalents Total Cash equivalents Total Holding company cash and investments 72.7 479.4 552.1 — — — 72.7 479.4 552.1 Holding company assets pledged for derivative obligations — 40.6 40.6 — — — — 40.6 40.6 Subsidiary cash and short term investments 3,243.3 2,105.6 5,348.9 500.8 353.6 854.4 3,744.1 2,459.2 6,203.3 Fairfax India 34.5 143.5 178.0 0.8 6.0 6.8 35.3 149.5 184.8 3,350.5 2,769.1 6,119.6 501.6 359.6 861.2 3,852.1 3,128.7 6,980.8 December 31, 2021 Unrestricted cash and cash equivalents included in the consolidated statement Cash and cash equivalents included on of cash flows Restricted cash and cash equivalents the consolidated balance sheet Cash Cash Cash Cash equivalents Total Cash equivalents Total Cash equivalents Total Holding company cash and investments 129.9 336.0 465.9 — — — 129.9 336.0 465.9 Holding company assets pledged for derivative obligations — 46.8 46.8 — — — — 46.8 46.8 Subsidiary cash and short term investments 5,259.2 5,777.6 11,036.8 484.6 761.8 1,246.4 5,743.8 6,539.4 12,283.2 Subsidiary assets pledged for derivative obligations — 74.0 74.0 — — — — 74.0 74.0 Fairfax India 35.1 26.8 61.9 1.6 13.0 14.6 36.7 39.8 76.5 5,424.2 6,261.2 11,685.4 486.2 774.8 1,261.0 5,910.4 7,036.0 12,946.4 |
Schedule of cash flow, supplemental disclosures | Details of certain cash flows included in the consolidated statement of cash flows for the years ended December 31 were as follows: 2022 2021 Net (purchases) sales of investments classified at FVTPL Short term investments 6,352.5 (767.1) Bonds (16,016.2) 2,545.7 Preferred stocks (293.2) (37.3) Common stocks (63.6) 477.2 Net derivatives and other invested assets 380.3 395.9 (9,640.2) 2,614.4 Changes in operating assets and liabilities Net decrease (increase) in restricted cash and cash equivalents 393.7 (472.6) Provision for losses and loss adjustment expenses 4,530.1 3,692.0 Provision for unearned premiums 1,455.3 2,152.2 Provision for life policy benefits (142.4) (167.9) Insurance contract receivables (1,134.9) (1,152.9) Insurance contract payables 625.8 1,079.8 Recoverable from reinsurers (1,257.9) (1,580.0) Other receivables (349.8) (96.7) Accounts payable and accrued liabilities 338.2 291.1 Other (638.0) (758.1) 3,820.1 2,986.9 Net interest and dividends received Interest and dividends received 1,030.8 865.7 Interest paid on borrowings (360.5) (366.7) Interest paid on lease liabilities (48.1) (54.8) 622.2 444.2 Net income taxes paid (416.4) (288.7) |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions | |
Schedule of related party transactions | Compensation for the company’s key management team for the years ended December 31 determined in accordance with the company’s IFRS accounting policies was as follows: 2022 2021 Salaries and other short-term employee benefits 10.2 10.8 Share-based payments 5.7 4.7 15.9 15.5 Compensation for the company’s Board of Directors for the years ended December 31 was as follows: 2022 2021 Retainers and fees 1.7 1.5 Share-based payments 0.3 0.4 2.0 1.9 |
Subsidiaries (Tables)
Subsidiaries (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Subsidiaries | |
Schedule of interests in subsidiaries | Fairfax’s ownership (100% other than as December 31, 2022 Domicile shown below) Property and casualty insurance and reinsurance North American Insurers Northbridge Financial Corporation (Northbridge) Canada Crum & Forster Holdings Corp. (Crum & Forster) United States Zenith National Insurance Corp. (Zenith National) United States Global Insurers and Reinsurers Odyssey Group Holdings, Inc. (Odyssey Group) United States 90.0 % Brit Limited (Brit) United Kingdom 86.2 % Allied World Assurance Company Holdings, Ltd (Allied World) Bermuda 82.9 % International Insurers and Reinsurers Fairfax Central and Eastern Europe, which consists of: Polskie Towarzystwo Reasekuracji Spólka Akcyjna (Polish Re) Poland Colonnade Insurance S.A. (Colonnade Insurance) Luxembourg FFH Ukraine Holdings (Fairfax Ukraine), which consists of: Ukraine 70.0 % ARX Insurance Company (ARX Insurance) Ukraine Private Joint Stock Company Insurance Company Universalna (Universalna) Ukraine Fairfax Latin America, which consists of: Fairfax Brasil Seguros Corporativos S.A. (Fairfax Brasil) Brazil La Meridional Compañía Argentina de Seguros S.A. (La Meridional Argentina) Argentina SBS Seguros Colombia S.A. (Southbridge Colombia) Colombia SBI Seguros Uruguay S.A. (Southbridge Uruguay) Uruguay Southbridge Compañía de Seguros Generales S.A. (Southbridge Chile) Chile Bryte Insurance Company Ltd (Bryte Insurance) South Africa Eurolife FFH General Insurance Single Member S.A. (Eurolife General) Greece 80.0 % Group Re, which underwrites business in: CRC Reinsurance Limited (CRC Re) Barbados Wentworth Insurance Company Ltd. (Wentworth) Barbados Connemara Reinsurance Company Ltd. (Connemara) Barbados Fairfax Asia, which consists of: Falcon Insurance Company (Hong Kong) Limited (Falcon) Hong Kong The Pacific Insurance Berhad (Pacific Insurance) Malaysia 85.0 % PT Asuransi Multi Artha Guna Tbk (AMAG Insurance) Indonesia 80.3 % Fairfirst Insurance Limited (Fairfirst Insurance) Sri Lanka 78.0 % Singapore Reinsurance Corporation Limited (Singapore Re) Singapore Life insurance and Run-off Eurolife FFH Life Insurance Group Holdings S.A. (Eurolife) Greece 80.0 % Run-off , which is principally comprised of: U.S. Run-off: TIG Insurance Company (TIG Insurance) United States Investment management Hamblin Watsa Investment Counsel Ltd. (Hamblin Watsa) Canada Fairfax’s December 31, 2022 Domicile ownership Primary business Non-insurance companies Restaurants and retail Recipe Unlimited Corporation (Recipe) Canada 75.7 % Franchisor, owner and operator of restaurants Sporting Life Group Limited, which owns: Canada 88.5 % Invests in retail businesses 100.0% of Sporting Life Inc. (Sporting Life) Canada 88.5 % Retailer of sporting goods and sports apparel 100.0% of Golf Town Limited (Golf Town) Canada 88.5 % Retailer of golf equipment, apparel and accessories Fairfax India Fairfax India Holdings Corporation (Fairfax India) Canada 34.7 % (1) Invests in public and private Indian businesses Thomas Cook India Thomas Cook (India) Limited (Thomas Cook India), which owns: India 73.3 % Provider of integrated travel and travel-related financial services 100.0% of Sterling Holiday Resorts Limited (Sterling Resorts) India 73.3 % Owner and operator of holiday resorts Other AGT Food and Ingredients Inc. (AGT) Canada 59.6 % Originator, processor and distributor of value-added pulses and staple foods Dexterra Group Inc. (Dexterra Group) Canada 48.7 % (2) Provider of Infrastructure support services Boat Rocker Media Inc. (Boat Rocker) Canada 44.9 % (3) Entertainment content creator, producer and distributor Farmers Edge Inc. (Farmers Edge) Canada 61.3 % Provider of advanced digital tools for agriculture Grivalia Hospitality S.A. (Grivalia Hospitality) Greece 78.4 % Hospitality real estate investor, developer and manager (1) The company owns multiple voting shares and subordinate voting shares of Fairfax India that give it voting rights of 94.4 %. (2) The company has de facto voting control of Dexterra Group as its largest equity and voting shareholder. (3) The company has voting rights of 56.1 % due to Boat Rocker’s issuance of non-voting shares to non-controlling interests. |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Customer and broker relationships | Minimum | |
Summary of Significant Accounting Policies | |
Intangible asset useful lives | 8 years |
Customer and broker relationships | Maximum | |
Summary of Significant Accounting Policies | |
Intangible asset useful lives | 20 years |
Computer software | Minimum | |
Summary of Significant Accounting Policies | |
Intangible asset useful lives | 3 years |
Computer software | Maximum | |
Summary of Significant Accounting Policies | |
Intangible asset useful lives | 15 years |
Restricted Share Units | Maximum | |
Summary of Significant Accounting Policies | |
Vesting period | 15 years |
Cash and Investments - Total in
Cash and Investments - Total investments, net of derivative obligations (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Cash and Investments | ||
Holding company, cash and investments | $ 1,241.2 | $ 1,367.4 |
Holding company, assets pledged for derivative obligations | 104.6 | 110.9 |
Holding company cash and investments as presented on the consolidated balance sheet | 1,345.8 | 1,478.3 |
Holding company, derivative obligations | (19.4) | (32.1) |
Holding company cash and investments, net | 1,326.4 | 1,446.2 |
Portfolio investments, cash and investments | 52,328.8 | 49,511.8 |
Portfolio investments, assets pledged for derivative obligations | 51.3 | 119.6 |
Fairfax India cash, portfolio investments and associates | 1,942.8 | 2,066 |
Portfolio investments as presented on the consolidated balance sheet | 54,322.9 | 51,697.4 |
Portfolio investments, derivative obligations | (171.6) | (120.8) |
Portfolio investments cash and investments, net | 54,151.3 | 51,576.6 |
Total investments, net of derivative obligations | 55,477.7 | 53,022.8 |
Restricted cash and cash equivalents | 861.2 | 1,261 |
Investments in limited partnerships | 1,982.5 | 1,971 |
Cash and cash equivalents | ||
Cash and Investments | ||
Holding company, cash and investments | 552.1 | 465.9 |
Portfolio investments, cash and investments | 6,203.3 | 12,283.2 |
Cash equivalents | ||
Cash and Investments | ||
Holding company, assets pledged for derivative obligations | 40.6 | 46.8 |
Portfolio investments, assets pledged for derivative obligations | 74 | |
Fairfax India cash, portfolio investments and associates | 184.8 | 76.5 |
Short term investments | ||
Cash and Investments | ||
Holding company, cash and investments | 126.6 | 216.9 |
Holding company, assets pledged for derivative obligations | 64 | 64.1 |
Portfolio investments, cash and investments | 3,164.9 | 9,516.3 |
Portfolio investments, assets pledged for derivative obligations | 45.6 | |
Fairfax India cash, portfolio investments and associates | 49.7 | 6.2 |
Bonds | ||
Cash and Investments | ||
Holding company, cash and investments | 243.2 | 242.6 |
Fairfax India cash, portfolio investments and associates | 128.2 | 199.8 |
Preferred stocks | ||
Cash and Investments | ||
Holding company, cash and investments | 11.1 | 14 |
Portfolio investments, cash and investments | 2,338 | 2,405.9 |
Common stocks | ||
Cash and Investments | ||
Holding company, cash and investments | 75.4 | 137.5 |
Portfolio investments, cash and investments | 5,124.3 | 5,468.9 |
Fairfax India cash, portfolio investments and associates | 237.5 | 434.6 |
Investments in associates | ||
Cash and Investments | ||
Portfolio investments, cash and investments | 6,091.3 | 4,755.1 |
Fairfax India cash, portfolio investments and associates | 1,342.6 | 1,348.9 |
Derivatives | ||
Cash and Investments | ||
Holding company, cash and investments | 232.8 | 290.5 |
Portfolio investments, cash and investments | 235 | 291.3 |
Other invested assets | ||
Cash and Investments | ||
Portfolio investments, cash and investments | 593.5 | 699.9 |
Bonds | ||
Cash and Investments | ||
Portfolio investments, cash and investments | 28,578.5 | $ 14,091.2 |
Portfolio investments, assets pledged for derivative obligations | $ 51.3 |
Cash and Investments - Assets p
Cash and Investments - Assets pledged to third parties (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Assets pledged to third parties | ||
Cash and Investments | ||
Financial assets pledged as collateral | $ 7,335.2 | $ 6,582 |
Regulatory deposits | ||
Cash and Investments | ||
Financial assets pledged as collateral | 5,724.2 | 5,147.1 |
Security for reinsurance and other | ||
Cash and Investments | ||
Financial assets pledged as collateral | $ 1,611 | $ 1,434.9 |
Cash and Investments - Fixed In
Cash and Investments - Fixed Income Maturity Profile (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash and Investments | ||
Bonds with call features | $ 5,933.7 | $ 4,063 |
Bonds with put features | 30.9 | 77.2 |
Bonds with call and put features | 427.7 | 467.8 |
Secured investments in first mortgage loans | 2,500.7 | 1,659.4 |
Bonds | ||
Cash and Investments | ||
Amortized cost | 29,968.6 | 14,221.1 |
Fair value | $ 29,001.2 | $ 14,533.6 |
Pre-tax effective interest rate | 3.60% | 2.70% |
Bonds | Due in 1 year or less | ||
Cash and Investments | ||
Amortized cost | $ 8,506.5 | $ 6,022.8 |
Fair value | 8,192.5 | 5,946.5 |
Bonds | Due after 1 year through 3 years | ||
Cash and Investments | ||
Amortized cost | 16,077.6 | 3,933.5 |
Fair value | 15,686.2 | 4,206 |
Bonds | Due after 3 years through 5 years | ||
Cash and Investments | ||
Amortized cost | 4,205.8 | 2,740.7 |
Fair value | 4,116.6 | 2,744.1 |
Bonds | Due after 5 years through 10 years | ||
Cash and Investments | ||
Amortized cost | 318.8 | 534 |
Fair value | 291.1 | 531.3 |
Bonds | Due after 10 years | ||
Cash and Investments | ||
Amortized cost | 859.9 | 990.1 |
Fair value | 714.8 | 1,105.7 |
U.S. treasury bond forward contracts | ||
Cash and Investments | ||
Notional amount | 183.7 | $ 1,691.3 |
U.S. treasury bond forward contracts | Due after 1 year through 3 years | ||
Cash and Investments | ||
Purchase of bonds and loans | 8,287 | |
U.S. treasury bond forward contracts | Due after 3 years through 5 years | ||
Cash and Investments | ||
Purchase of bonds and loans | 2,905.1 | |
Canadian government bonds | Due in 1 year or less | ||
Cash and Investments | ||
Purchase of bonds and loans | 779 | |
Canadian government bonds | Due after 1 year through 3 years | ||
Cash and Investments | ||
Purchase of bonds and loans | 609.3 | |
Canadian provincial bonds | Due in 1 year or less | ||
Cash and Investments | ||
Purchase of bonds and loans | 207.6 | |
Short-dated high quality corporate bonds | Due after 1 year through 3 years | ||
Cash and Investments | ||
Purchase of bonds and loans | 2,202.6 | |
First mortgage loans | Due in 1 year or less | ||
Cash and Investments | ||
Purchase of bonds and loans | $ 870.2 |
Cash and Investments - Fair val
Cash and Investments - Fair value hierarchy (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash and Investments | ||
Assets | $ 92,125.1 | $ 86,645.4 |
Derivative obligations | $ (71,789.3) | $ (65,330.1) |
Percentage of assets | 100% | 100% |
Restricted cash and cash equivalents | $ 861.2 | $ 1,261 |
Secured investments in first mortgage loans | $ 2,500.7 | $ 1,659.4 |
Quoted prices (Level 1) | ||
Cash and Investments | ||
Percentage of assets | 23.50% | 52.30% |
Significant other observable inputs (Level 2) | ||
Cash and Investments | ||
Percentage of assets | 58.30% | 29.90% |
Significant unobservable inputs (Level 3) | ||
Cash and Investments | ||
Assets | $ 8,744.3 | |
Percentage of assets | 18.20% | 17.80% |
Secured investments in first mortgage loans | $ 2,500.7 | $ 1,659.4 |
Significant unobservable inputs (Level 3) | Bonds | ||
Cash and Investments | ||
Assets | 3,465.3 | |
Significant unobservable inputs (Level 3) | Derivatives and other invested assets | ||
Cash and Investments | ||
Assets | 680.3 | |
Recurring fair value measurement | ||
Cash and Investments | ||
Assets | 48,043.8 | 46,918.8 |
Investment in associates | 9,252.3 | 8,291.2 |
Recurring fair value measurement | Derivative obligations | ||
Cash and Investments | ||
Derivative obligations | (191) | (152.9) |
Recurring fair value measurement | Cash and cash equivalents | ||
Cash and Investments | ||
Assets | 6,980.8 | 12,946.4 |
Recurring fair value measurement | Short term investments | ||
Cash and Investments | ||
Assets | 3,405.2 | 9,849.1 |
Recurring fair value measurement | Short term investments, Canadian government | ||
Cash and Investments | ||
Assets | 91.8 | 16.2 |
Recurring fair value measurement | Short term investments, Canadian provincials | ||
Cash and Investments | ||
Assets | 38.1 | 535.8 |
Recurring fair value measurement | Short term investments, U.S. treasury | ||
Cash and Investments | ||
Assets | 1,574.5 | 7,608.8 |
Recurring fair value measurement | Short term investments, Other government | ||
Cash and Investments | ||
Assets | 1,402.8 | 1,424.4 |
Recurring fair value measurement | Short term investments, Corporate and other | ||
Cash and Investments | ||
Assets | 298 | 263.9 |
Recurring fair value measurement | Bonds | ||
Cash and Investments | ||
Assets | 29,001.2 | 14,533.6 |
Recurring fair value measurement | Bonds, Canadian government | ||
Cash and Investments | ||
Assets | 1,923.5 | 614.6 |
Recurring fair value measurement | Bonds, Canadian provincials | ||
Cash and Investments | ||
Assets | 284.1 | 45 |
Recurring fair value measurement | Bonds, U.S. treasury | ||
Cash and Investments | ||
Assets | 14,378.8 | 3,957.9 |
Recurring fair value measurement | Bonds, U.S. states and municipalities | ||
Cash and Investments | ||
Assets | 262.7 | 387.2 |
Recurring fair value measurement | Bonds, Other government | ||
Cash and Investments | ||
Assets | 2,700.2 | 2,655 |
Recurring fair value measurement | Bonds, Corporate and other | ||
Cash and Investments | ||
Assets | 9,451.9 | 6,873.9 |
Recurring fair value measurement | Preferred stocks | ||
Cash and Investments | ||
Assets | 2,349.1 | 2,419.9 |
Recurring fair value measurement | Preferred stocks, Canadian | ||
Cash and Investments | ||
Assets | 32.8 | 110.2 |
Recurring fair value measurement | Preferred stocks, U.S. | ||
Cash and Investments | ||
Assets | 233.6 | 40.6 |
Recurring fair value measurement | Preferred stocks, Other | ||
Cash and Investments | ||
Assets | 2,082.7 | 2,269.1 |
Recurring fair value measurement | Common stocks | ||
Cash and Investments | ||
Assets | 5,437.2 | 6,041 |
Recurring fair value measurement | Common stocks, Canadian | ||
Cash and Investments | ||
Assets | 1,244.4 | 1,596.3 |
Recurring fair value measurement | Common stocks, U.S. | ||
Cash and Investments | ||
Assets | 1,804.3 | 1,785.2 |
Recurring fair value measurement | Common stocks, Other | ||
Cash and Investments | ||
Assets | 2,388.5 | 2,659.5 |
Recurring fair value measurement | Derivatives and other invested assets | ||
Cash and Investments | ||
Assets | 1,061.3 | 1,281.7 |
Recurring fair value measurement | Quoted prices (Level 1) | ||
Cash and Investments | ||
Assets | 11,286.2 | 24,544.4 |
Investment in associates | 4,693.8 | 4,188.8 |
Recurring fair value measurement | Quoted prices (Level 1) | Cash and cash equivalents | ||
Cash and Investments | ||
Assets | 6,980.8 | 12,946.4 |
Recurring fair value measurement | Quoted prices (Level 1) | Short term investments | ||
Cash and Investments | ||
Assets | 1,868.7 | 8,444.3 |
Recurring fair value measurement | Quoted prices (Level 1) | Short term investments, Canadian government | ||
Cash and Investments | ||
Assets | 91.8 | 16.2 |
Recurring fair value measurement | Quoted prices (Level 1) | Short term investments, Canadian provincials | ||
Cash and Investments | ||
Assets | 38.1 | 535.8 |
Recurring fair value measurement | Quoted prices (Level 1) | Short term investments, U.S. treasury | ||
Cash and Investments | ||
Assets | 1,574.5 | 7,608.8 |
Recurring fair value measurement | Quoted prices (Level 1) | Short term investments, Other government | ||
Cash and Investments | ||
Assets | 164.3 | 283.5 |
Recurring fair value measurement | Quoted prices (Level 1) | Preferred stocks | ||
Cash and Investments | ||
Assets | 23.6 | 13.5 |
Recurring fair value measurement | Quoted prices (Level 1) | Preferred stocks, Canadian | ||
Cash and Investments | ||
Assets | 10.4 | |
Recurring fair value measurement | Quoted prices (Level 1) | Preferred stocks, Other | ||
Cash and Investments | ||
Assets | 13.2 | 13.5 |
Recurring fair value measurement | Quoted prices (Level 1) | Common stocks | ||
Cash and Investments | ||
Assets | 2,413.1 | 3,140.1 |
Recurring fair value measurement | Quoted prices (Level 1) | Common stocks, Canadian | ||
Cash and Investments | ||
Assets | 624.3 | 1,104.2 |
Recurring fair value measurement | Quoted prices (Level 1) | Common stocks, U.S. | ||
Cash and Investments | ||
Assets | 691 | 597.9 |
Recurring fair value measurement | Quoted prices (Level 1) | Common stocks, Other | ||
Cash and Investments | ||
Assets | 1,097.8 | 1,438 |
Recurring fair value measurement | Quoted prices (Level 1) | Derivatives and other invested assets | ||
Cash and Investments | ||
Assets | 0.1 | |
Recurring fair value measurement | Significant other observable inputs (Level 2) | ||
Cash and Investments | ||
Assets | 28,013.3 | 14,031.2 |
Investment in associates | 95.3 | 106.8 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Derivative obligations | ||
Cash and Investments | ||
Derivative obligations | (151.8) | (88.5) |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Short term investments | ||
Cash and Investments | ||
Assets | 1,536.5 | 1,404.8 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Short term investments, Other government | ||
Cash and Investments | ||
Assets | 1,238.5 | 1,140.9 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Short term investments, Corporate and other | ||
Cash and Investments | ||
Assets | 298 | 263.9 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Bonds | ||
Cash and Investments | ||
Assets | 25,535.9 | 11,737.8 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Bonds, Canadian government | ||
Cash and Investments | ||
Assets | 1,923.5 | 614.6 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Bonds, Canadian provincials | ||
Cash and Investments | ||
Assets | 284.1 | 45 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Bonds, U.S. treasury | ||
Cash and Investments | ||
Assets | 14,378.8 | 3,957.9 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Bonds, U.S. states and municipalities | ||
Cash and Investments | ||
Assets | 262.7 | 387.2 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Bonds, Other government | ||
Cash and Investments | ||
Assets | 2,700.2 | 2,655 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Bonds, Corporate and other | ||
Cash and Investments | ||
Assets | 5,986.6 | 4,078.1 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Preferred stocks | ||
Cash and Investments | ||
Assets | 278.4 | 304.6 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Preferred stocks, Canadian | ||
Cash and Investments | ||
Assets | 9.2 | 16.6 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Preferred stocks, Other | ||
Cash and Investments | ||
Assets | 269.2 | 288 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Common stocks | ||
Cash and Investments | ||
Assets | 472.5 | 497.1 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Common stocks, Canadian | ||
Cash and Investments | ||
Assets | 192.3 | 188.4 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Common stocks, U.S. | ||
Cash and Investments | ||
Assets | 26.1 | 32 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Common stocks, Other | ||
Cash and Investments | ||
Assets | 254.1 | 276.7 |
Recurring fair value measurement | Significant other observable inputs (Level 2) | Derivatives and other invested assets | ||
Cash and Investments | ||
Assets | 341.8 | 175.4 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | ||
Cash and Investments | ||
Assets | 8,744.3 | 8,343.2 |
Investment in associates | 4,463.2 | 3,995.6 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Derivative obligations | ||
Cash and Investments | ||
Derivative obligations | (39.2) | (64.4) |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Bonds | ||
Cash and Investments | ||
Assets | 3,465.3 | 2,795.8 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Bonds, Corporate and other | ||
Cash and Investments | ||
Assets | 3,465.3 | 2,795.8 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Preferred stocks | ||
Cash and Investments | ||
Assets | 2,047.1 | 2,101.8 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Preferred stocks, Canadian | ||
Cash and Investments | ||
Assets | 13.2 | 93.6 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Preferred stocks, U.S. | ||
Cash and Investments | ||
Assets | 233.6 | 40.6 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Preferred stocks, Other | ||
Cash and Investments | ||
Assets | 1,800.3 | 1,967.6 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Common stocks | ||
Cash and Investments | ||
Assets | 2,551.6 | 2,403.8 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Common stocks, Canadian | ||
Cash and Investments | ||
Assets | 427.8 | 303.7 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Common stocks, U.S. | ||
Cash and Investments | ||
Assets | 1,087.2 | 1,155.3 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Common stocks, Other | ||
Cash and Investments | ||
Assets | 1,036.6 | 944.8 |
Recurring fair value measurement | Significant unobservable inputs (Level 3) | Derivatives and other invested assets | ||
Cash and Investments | ||
Assets | $ 719.5 | $ 1,106.2 |
Go Digit Infoworks Services Private Limited | ||
Cash and Investments | ||
Ownership percentage | 49% |
Cash and Investments - Changes
Cash and Investments - Changes in Level 3 financial assets (Details) $ in Millions, ₨ in Billions | 1 Months Ended | 12 Months Ended | |||
Jun. 30, 2021 USD ($) | Jun. 30, 2021 INR (₨) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jun. 30, 2021 INR (₨) | |
Changes in fair value measurement, assets | |||||
Acquisitions of subsidiaries | $ 111.5 | $ 7.5 | |||
Net unrealized foreign currency translation losses on foreign operations | (673.7) | (199.5) | |||
Significant unobservable inputs (Level 3) | |||||
Changes in fair value measurement, assets | |||||
Balance - January 1 | 8,343.2 | 5,176.8 | |||
Net realized and unrealized gains (losses) included in the consolidated statement of earnings | (518.5) | 2,362.5 | |||
Purchases | 2,025.6 | 1,860.2 | |||
Acquisitions of subsidiaries | 74.9 | ||||
Transfer into category | 150.5 | ||||
Sales and distributions | (999.8) | (1,164.9) | |||
Transfer out of category | (2.7) | (112.7) | |||
Unrealized foreign currency translation losses on foreign subsidiaries included in other comprehensive income (loss) | (103.5) | (4.1) | |||
Balance - December 31 | $ 8,744.3 | 8,343.2 | |||
Go Digit Infoworks Services Private Limited | |||||
Changes in fair value measurement, assets | |||||
Ownership percentage | 49% | ||||
Go Digit Insurance Limited | |||||
Changes in fair value measurement, assets | |||||
Proceeds from issuance of equity shares | $ 200 | ₨ 14.9 | |||
Fair value of equity shares | $ 3,500 | ₨ 259.5 | |||
Go Digit Insurance Limited | Significant unobservable inputs (Level 3) | |||||
Changes in fair value measurement, assets | |||||
Fair value of equity shares | 200 | ||||
Net unrealized gain on investment in convertible preferred shares, inclusive of foreign exchange losses | 1,490.3 | ||||
Unrealized losses recognized in profit or loss attributable to changes in investment fair value | $ 167.2 | ||||
Private placement debt securities | |||||
Changes in fair value measurement, assets | |||||
Net purchases of first mortgage loans | 870.2 | 826.9 | |||
Private placement debt securities | Significant unobservable inputs (Level 3) | |||||
Changes in fair value measurement, assets | |||||
Balance - January 1 | 2,795.8 | 1,774.2 | |||
Net realized and unrealized gains (losses) included in the consolidated statement of earnings | (378.8) | 69.1 | |||
Purchases | 1,456 | 1,241.5 | |||
Acquisitions of subsidiaries | 47.5 | ||||
Transfer into category | 139.6 | ||||
Sales and distributions | (382.4) | (476.6) | |||
Unrealized foreign currency translation losses on foreign subsidiaries included in other comprehensive income (loss) | (25.3) | 0.5 | |||
Balance - December 31 | 3,465.3 | 2,795.8 | |||
Private company preferred shares | Significant unobservable inputs (Level 3) | |||||
Changes in fair value measurement, assets | |||||
Balance - January 1 | 2,101.8 | 587.4 | |||
Net realized and unrealized gains (losses) included in the consolidated statement of earnings | (247.4) | 1,489.3 | |||
Purchases | 286.4 | 32 | |||
Sales and distributions | (88.1) | (7.2) | |||
Unrealized foreign currency translation losses on foreign subsidiaries included in other comprehensive income (loss) | (5.6) | 0.3 | |||
Balance - December 31 | 2,047.1 | 2,101.8 | |||
Limited partnerships and other | Significant unobservable inputs (Level 3) | |||||
Changes in fair value measurement, assets | |||||
Balance - January 1 | 1,789.1 | 1,766.9 | |||
Net realized and unrealized gains (losses) included in the consolidated statement of earnings | 143 | 450.6 | |||
Purchases | 113.1 | 254.3 | |||
Sales and distributions | (207) | (580.9) | |||
Transfer out of category | (102) | ||||
Unrealized foreign currency translation losses on foreign subsidiaries included in other comprehensive income (loss) | (14) | 0.2 | |||
Balance - December 31 | 1,824.2 | 1,789.1 | |||
Private equity funds | Significant unobservable inputs (Level 3) | |||||
Changes in fair value measurement, assets | |||||
Balance - January 1 | 107.7 | 110.8 | |||
Net realized and unrealized gains (losses) included in the consolidated statement of earnings | (1.4) | 2.4 | |||
Sales and distributions | (4.2) | (5.9) | |||
Unrealized foreign currency translation losses on foreign subsidiaries included in other comprehensive income (loss) | (4.6) | 0.4 | |||
Balance - December 31 | 97.5 | 107.7 | |||
Common stocks | Significant unobservable inputs (Level 3) | |||||
Changes in fair value measurement, assets | |||||
Balance - January 1 | 507 | 239.9 | |||
Net realized and unrealized gains (losses) included in the consolidated statement of earnings | 61.9 | 53.7 | |||
Purchases | 102.7 | 216.9 | |||
Transfer into category | 10.9 | ||||
Sales and distributions | (14.3) | (2.5) | |||
Transfer out of category | (2.7) | (10.7) | |||
Unrealized foreign currency translation losses on foreign subsidiaries included in other comprehensive income (loss) | (24.7) | (1.2) | |||
Balance - December 31 | 629.9 | 507 | |||
Derivatives and other invested assets | Significant unobservable inputs (Level 3) | |||||
Changes in fair value measurement, assets | |||||
Balance - January 1 | 1,041.8 | 697.6 | |||
Net realized and unrealized gains (losses) included in the consolidated statement of earnings | (95.8) | 297.4 | |||
Purchases | 67.4 | 115.5 | |||
Acquisitions of subsidiaries | 27.4 | ||||
Sales and distributions | (303.8) | (91.8) | |||
Unrealized foreign currency translation losses on foreign subsidiaries included in other comprehensive income (loss) | (29.3) | (4.3) | |||
Balance - December 31 | $ 680.3 | $ 1,041.8 |
Cash and Investments - Fair V_2
Cash and Investments - Fair Value Assets Measurement Techniques (Details) $ in Millions | Dec. 31, 2022 USD ($) | Dec. 31, 2022 CAD ($) | Dec. 31, 2021 USD ($) |
Cash and Investments | |||
Assets | $ 92,125.1 | $ 86,645.4 | |
Private placement debt securities | Discounted cash flow | Minimum | |||
Cash and Investments | |||
Credit spread | 2.80% | 2.80% | |
Private placement debt securities | Discounted cash flow | Maximum | |||
Cash and Investments | |||
Credit spread | 12.70% | 12.70% | |
Mortgage loans | Discounted cash flow | Minimum | |||
Cash and Investments | |||
Credit spread | 2.10% | 2.10% | |
Mortgage loans | Discounted cash flow | Maximum | |||
Cash and Investments | |||
Credit spread | 6.40% | 6.40% | |
Mortgage loans | Market approach | |||
Cash and Investments | |||
Assets | $ 250 | $ 149.4 | |
Private company preferred shares | Discounted cash flow | Minimum | |||
Cash and Investments | |||
Discount rate | 10.90% | 10.90% | |
Long term growth rate | 6.30% | 6.30% | |
Private company preferred shares | Discounted cash flow | Maximum | |||
Cash and Investments | |||
Discount rate | 10.90% | 10.90% | |
Long term growth rate | 6.30% | 6.30% | |
Private placement preferred shares | Discounted cash flow | Minimum | |||
Cash and Investments | |||
Credit spread | 5.80% | 5.80% | |
Private placement preferred shares | Discounted cash flow | Maximum | |||
Cash and Investments | |||
Credit spread | 5.80% | 5.80% | |
Investment property | Income capitalization | Minimum | |||
Cash and Investments | |||
Terminal capitalization rate | 6% | 6% | |
Discount rate | 6.90% | 6.90% | |
Market rent growth rate | 2.60% | 2.60% | |
Investment property | Income capitalization | Maximum | |||
Cash and Investments | |||
Terminal capitalization rate | 8% | 8% | |
Discount rate | 9.30% | 9.30% | |
Market rent growth rate | 3% | 3% | |
Investment property | Sales comparison | Minimum | |||
Cash and Investments | |||
Price per acre (Cdn$ thousands) | $ 30,000 | ||
Investment property | Sales comparison | Maximum | |||
Cash and Investments | |||
Price per acre (Cdn$ thousands) | $ 150,000 | ||
Significant unobservable inputs (Level 3) | |||
Cash and Investments | |||
Assets | $ 8,744.3 | ||
Significant unobservable inputs (Level 3) | Bonds | |||
Cash and Investments | |||
Assets | 3,465.3 | ||
Significant unobservable inputs (Level 3) | Private placement debt securities | Discounted cash flow | |||
Cash and Investments | |||
Assets | 834.2 | ||
Significant unobservable inputs (Level 3) | Mortgage loans | Market approach | |||
Cash and Investments | |||
Assets | 2,500.7 | ||
Significant unobservable inputs (Level 3) | Other bonds | Various | |||
Cash and Investments | |||
Assets | 130.4 | ||
Significant unobservable inputs (Level 3) | Preferred Stocks | |||
Cash and Investments | |||
Assets | 2,047.1 | ||
Significant unobservable inputs (Level 3) | Private company preferred shares | Discounted cash flow | |||
Cash and Investments | |||
Assets | 1,798.3 | ||
Significant unobservable inputs (Level 3) | Private placement preferred shares | Discounted cash flow | |||
Cash and Investments | |||
Assets | 156.7 | ||
Significant unobservable inputs (Level 3) | Other preferred stocks | Various | |||
Cash and Investments | |||
Assets | 92.1 | ||
Significant unobservable inputs (Level 3) | Common Stocks | |||
Cash and Investments | |||
Assets | 2,551.6 | ||
Significant unobservable inputs (Level 3) | Limited partnerships and other | Net asset value | |||
Cash and Investments | |||
Assets | 1,824.2 | ||
Significant unobservable inputs (Level 3) | Common shares | Market approach | |||
Cash and Investments | |||
Assets | 261.6 | ||
Significant unobservable inputs (Level 3) | Other common stocks | Various | |||
Cash and Investments | |||
Assets | 465.8 | ||
Significant unobservable inputs (Level 3) | Derivatives and other invested assets | |||
Cash and Investments | |||
Assets | 680.3 | ||
Significant unobservable inputs (Level 3) | Investment property | Income capitalization | |||
Cash and Investments | |||
Assets | 437.3 | ||
Significant unobservable inputs (Level 3) | Investment property | Sales comparison | |||
Cash and Investments | |||
Assets | 66 | ||
Significant unobservable inputs (Level 3) | Other derivatives and other invested assets | Various | |||
Cash and Investments | |||
Assets | $ 177 |
Cash and Investments - Fair V_3
Cash and Investments - Fair Value Disclosures, Additional Information (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 USD ($) item | Dec. 31, 2021 USD ($) item | |
Cash and Investments | ||
Assets | $ 92,125.1 | $ 86,645.4 |
Private placement debt securities | Sensitivity Analysis, increase in credit spreads | ||
Cash and Investments | ||
Percentage of reasonably possible increase in unobservable input, assets | 1% | |
Increase (decrease) in fair value measurement due to reasonably possible increase in unobservable input, assets | $ (23.2) | |
Private placement debt securities | Sensitivity Analysis, decrease in credit spreads | ||
Cash and Investments | ||
Percentage of reasonably possible decrease in unobservable input, assets | (1.00%) | |
Increase (decrease) in fair value measurement due to reasonably possible decrease in unobservable input, assets | $ 24.5 | |
Mortgage Loans | Sensitivity Analysis, increase in credit spreads | ||
Cash and Investments | ||
Percentage of reasonably possible increase in unobservable input, assets | 1% | |
Mortgage Loans | Sensitivity Analysis, decrease in credit spreads | ||
Cash and Investments | ||
Percentage of reasonably possible decrease in unobservable input, assets | (1.00%) | |
Private company preferred shares | Sensitivity Analysis, increase in discount rate | ||
Cash and Investments | ||
Percentage of reasonably possible increase in unobservable input, assets | 1% | |
Increase (decrease) in fair value measurement due to reasonably possible increase in unobservable input, assets | $ (308.2) | |
Private company preferred shares | Sensitivity Analysis, decrease in discount rate | ||
Cash and Investments | ||
Percentage of reasonably possible decrease in unobservable input, assets | (1.00%) | |
Increase (decrease) in fair value measurement due to reasonably possible decrease in unobservable input, assets | $ 591.8 | |
Private company preferred shares | Sensitivity Analysis, increase in long term growth rate | ||
Cash and Investments | ||
Percentage of reasonably possible increase in unobservable input, assets | 0.50% | |
Increase (decrease) in fair value measurement due to reasonably possible increase in unobservable input, assets | $ 175.8 | |
Private company preferred shares | Sensitivity Analysis, decrease in long term growth rate | ||
Cash and Investments | ||
Percentage of reasonably possible decrease in unobservable input, assets | (0.50%) | |
Increase (decrease) in fair value measurement due to reasonably possible decrease in unobservable input, assets | $ (141.7) | |
Limited partnerships and other | Sensitivity Analysis, increase in net asset values | ||
Cash and Investments | ||
Percentage of reasonably possible increase in unobservable input, assets | 10% | |
Increase (decrease) in fair value measurement due to reasonably possible increase in unobservable input, assets | $ 182.4 | |
Limited partnerships and other | Sensitivity Analysis, decrease in net asset values | ||
Cash and Investments | ||
Percentage of reasonably possible decrease in unobservable input, assets | (10.00%) | |
Increase (decrease) in fair value measurement due to reasonably possible decrease in unobservable input, assets | $ (182.4) | |
Net asset value | Limited partnerships and other | ||
Cash and Investments | ||
Number of investments | item | 45 | 47 |
Net asset value | Limited partnerships and other - largest investment | Industrials | ||
Cash and Investments | ||
Assets | $ 258.2 | |
Net asset value | Limited partnerships and other - largest investment | Industrials One | ||
Cash and Investments | ||
Assets | $ 189.5 | |
Net asset value | Limited partnerships and other - largest investment | Industrials Two | ||
Cash and Investments | ||
Assets | 176.1 | |
Net asset value | Limited partnerships and other - largest investment | Oil and gas extraction | ||
Cash and Investments | ||
Assets | $ 374.8 | 252.1 |
Net asset value | Limited partnerships and other - largest investment | Household appliance manufacturing | ||
Cash and Investments | ||
Assets | $ 192 | |
Discounted cash flow | Private placement debt securities | ||
Cash and Investments | ||
Number of investments | item | 10 | 12 |
Discounted cash flow | Private placement debt securities - largest investment | ||
Cash and Investments | ||
Assets | $ 285 | $ 535.1 |
Market approach | Mortgage Loans | ||
Cash and Investments | ||
Number of investments | item | 50 | 36 |
Assets | $ 250 | $ 149.4 |
Cash and Investments - Interest
Cash and Investments - Interest and dividends and share of profit of associates (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Interest income: | ||
Cash and short term investments | $ 101.5 | $ 26.8 |
Bonds | 753.1 | 488.5 |
Derivatives and other invested assets | 18.9 | 53.1 |
Interest income | 873.5 | 568.4 |
Dividends: | ||
Dividend income | 140.4 | 108.2 |
Investment expenses | (52.1) | (35.8) |
Interest and dividends | 961.8 | 640.8 |
Share of profit of associates | 1,014.7 | 402 |
Preferred stocks | ||
Dividends: | ||
Dividend income | 39.7 | 14.1 |
Common stocks | ||
Dividends: | ||
Dividend income | 100.7 | 94.1 |
Associates | ||
Dividends: | ||
Share of profit of associates | $ 1,014.7 | $ 402 |
Cash and Investments - Net gain
Cash and Investments - Net gains (losses) on investments (Details) $ / shares in Units, shares in Millions, $ in Millions, ₨ in Billions | 12 Months Ended | ||||
Aug. 31, 2022 USD ($) shares | Apr. 06, 2022 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 INR (₨) | |
Cash and Investments | |||||
Net gains (losses) on investments | $ (1,733.9) | $ 3,445.1 | |||
Proceeds from sales of interests in associates | 192.9 | 809.2 | |||
Share of profit of associates | $ 1,014.7 | 402 | |||
Impact on reclassification from unrealized gain to realized gain | $ 0 | ||||
Stelco | |||||
Cash and Investments | |||||
Ownership percentage | 20.50% | ||||
Number of shares repurchased from investor | shares | 5.1 | ||||
Reclassification of unrealized gain to realized gain on equity method investments | $ 151.9 | ||||
Atlas Corp | |||||
Cash and Investments | |||||
Number of shares acquired on exercise of warrants | shares | 25 | ||||
Strike price | $ / shares | $ 8.05 | ||||
Cash consideration for acquisition of equity warrants | $ 201.3 | ||||
Net loss on investments | 37.2 | ||||
Realized gain on derecognition | 58.6 | ||||
Unrealized gain on derecognition of investments related to prior period | $ 95.8 | ||||
IIFL Finance Limited | |||||
Cash and Investments | |||||
Proceeds from sales of interests in associates | 113.7 | ₨ 8.6 | |||
Go Digit Infoworks Services Private Limited | |||||
Cash and Investments | |||||
Ownership percentage | 49% | ||||
Associates | |||||
Cash and Investments | |||||
Share of profit of associates | $ 1,014.7 | 402 | |||
Associates | IIFL Finance Limited | |||||
Cash and Investments | |||||
After tax gain amount | 42 | ||||
Proceeds from sales of interests in associates | 113.7 | ₨ 8.6 | |||
Common stocks | |||||
Cash and Investments | |||||
After tax gain amount | 364.5 | 483.4 | |||
Net change in unrealized gains (losses) | (607.2) | 850 | |||
Net gains (losses) on investments | (242.7) | 1,333.4 | |||
Preferred stocks - convertible | |||||
Cash and Investments | |||||
After tax gain amount | 1.4 | 0.7 | |||
Net change in unrealized gains (losses) | (5.8) | 2.1 | |||
Net gains (losses) on investments | (4.4) | 2.8 | |||
Preferred stocks - convertible | Go Digit Infoworks Services Private Limited | |||||
Cash and Investments | |||||
Net gains (losses) on investments | 1,490.3 | ||||
Bonds - convertible | |||||
Cash and Investments | |||||
After tax gain amount | 10.2 | 0.2 | |||
Net change in unrealized gains (losses) | (247.2) | 101.1 | |||
Net gains (losses) on investments | (237) | 101.3 | |||
Other equity derivatives | |||||
Cash and Investments | |||||
After tax gain amount | 331.7 | 461.5 | |||
Net change in unrealized gains (losses) | (140.9) | 170.1 | |||
Net gains (losses) on investments | 190.8 | 631.6 | |||
Other equity derivatives | Fairfax subordinate voting shares | |||||
Cash and Investments | |||||
Net change in unrealized gains (losses) | 100.6 | 91.8 | |||
Fair value | 196.3 | 95.7 | |||
Disposition of non-insurance associates | |||||
Cash and Investments | |||||
After tax gain amount | 45.1 | 52.7 | |||
Net gains (losses) on investments | 45.1 | 52.7 | |||
Deconsolidation of non-insurance subsidiaries | |||||
Cash and Investments | |||||
After tax gain amount | 4.4 | 190.3 | |||
Net gains (losses) on investments | 4.4 | 190.3 | |||
Long equity exposure and financial effects | |||||
Cash and Investments | |||||
After tax gain amount | 757.3 | 1,188.8 | |||
Net change in unrealized gains (losses) | (1,001.1) | 1,123.3 | |||
Net gains (losses) on investments | (243.8) | 2,312.1 | |||
Gains on derivatives | 154.8 | 130.9 | |||
Bonds | |||||
Cash and Investments | |||||
After tax gain amount | (183.6) | 338 | |||
Net change in unrealized gains (losses) | (1,064.9) | (624.6) | |||
Net gains (losses) on investments | (1,248.5) | (286.6) | |||
Fair value | 29,001.2 | 14,533.6 | |||
U.S. treasury bond forward contracts | |||||
Cash and Investments | |||||
After tax gain amount | 163 | 26 | |||
Net change in unrealized gains (losses) | (0.6) | (0.3) | |||
Net gains (losses) on investments | 162.4 | 25.7 | |||
Total bonds | |||||
Cash and Investments | |||||
After tax gain amount | (20.6) | 364 | |||
Net change in unrealized gains (losses) | (1,065.5) | (624.9) | |||
Net gains (losses) on investments | (1,086.1) | (260.9) | |||
Preferred stocks | |||||
Cash and Investments | |||||
After tax gain amount | 12.9 | 1.5 | |||
Net change in unrealized gains (losses) | (101.1) | 1,507.4 | |||
Net gains (losses) on investments | (88.2) | 1,508.9 | |||
Other derivative contracts | |||||
Cash and Investments | |||||
After tax gain amount | (62) | (157.2) | |||
Net change in unrealized gains (losses) | 86.6 | 181.3 | |||
Net gains (losses) on investments | 24.6 | 24.1 | |||
Foreign currency | |||||
Cash and Investments | |||||
After tax gain amount | 105.8 | (64.5) | |||
Net change in unrealized gains (losses) | (410.1) | (28.6) | |||
Net gains (losses) on investments | (304.3) | (93.1) | |||
Other | |||||
Cash and Investments | |||||
After tax gain amount | (36.3) | 130.4 | |||
Net change in unrealized gains (losses) | 0.2 | (176.4) | |||
Net gains (losses) on investments | (36.1) | (46) | |||
Net gains (losses) on investments | |||||
Cash and Investments | |||||
After tax gain amount | 757.1 | 1,463 | |||
Net change in unrealized gains (losses) | (2,491) | 1,982.1 | |||
Net gains (losses) on investments | $ (1,733.9) | $ 3,445.1 |
Investments in Associates - Sum
Investments in Associates - Summary (Details) $ in Millions, $ in Millions | 12 Months Ended | |||||
Oct. 04, 2022 | Aug. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Aug. 31, 2022 CAD ($) | Apr. 06, 2022 USD ($) | |
Investments in Associates | ||||||
Share of profit of associates | $ 1,014.7 | $ 402 | ||||
Investments in associates, including investment in associate held for sale | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 9,252.3 | 8,291.2 | ||||
Investments in associates | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 9,252.3 | 8,291.2 | ||||
Portfolio investments | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 6,772.9 | 5,671.9 | ||||
Portfolio investments | Investments in associates | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 6,772.9 | 5,671.9 | ||||
Portfolio investments | Fairfax India investments in associates | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 2,479.4 | 2,619.3 | ||||
Total | Investments in associates, including investment in associate held for sale | ||||||
Investments in Associates | ||||||
Carrying value | 7,433.9 | 6,104 | ||||
Total | Investments in associates | ||||||
Investments in Associates | ||||||
Carrying value | 7,433.9 | 6,104 | ||||
Share of profit of associates | 1,014.7 | 402 | ||||
Total | Portfolio investments | Investments in associates | ||||||
Investments in Associates | ||||||
Carrying value | 6,091.3 | 4,755.1 | ||||
Total | Portfolio investments | Fairfax India investments in associates | ||||||
Investments in Associates | ||||||
Carrying value | 1,342.6 | 1,348.9 | ||||
Associates and joint ventures | Investments in associates | ||||||
Investments in Associates | ||||||
Carrying value | 6,091.3 | 4,755.1 | ||||
Fairfax India associates | Investments in associates | ||||||
Investments in Associates | ||||||
Carrying value | $ 1,342.6 | 1,348.9 | ||||
Go Digit Infoworks Services Private Limited | ||||||
Investments in Associates | ||||||
Ownership percentage | 49% | |||||
Resolute Forest Products Inc. | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | $ 508.5 | |||||
Stelco Holdings Inc. | ||||||
Investments in Associates | ||||||
Ownership percentage | 20.50% | |||||
Investments in associates, at fair value | $ 352.2 | $ 461.3 | ||||
Insurance and reinsurance | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 1,069 | 1,099.1 | ||||
Insurance and reinsurance | Total | ||||||
Investments in Associates | ||||||
Carrying value | 647.3 | 607.4 | ||||
Share of profit of associates | 30.4 | 72.6 | ||||
Insurance and reinsurance | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | $ 647.3 | $ 607.4 | ||||
Insurance and reinsurance | Gulf Insurance Group K.S.C.P. | ||||||
Investments in Associates | ||||||
Ownership percentage | 43.70% | 43.70% | ||||
Investments in associates, at fair value | $ 415.8 | $ 409.5 | ||||
Insurance and reinsurance | Gulf Insurance Group K.S.C.P. | Total | ||||||
Investments in Associates | ||||||
Carrying value | 403.4 | 380 | ||||
Share of profit of associates | 53 | 55.5 | ||||
Insurance and reinsurance | Gulf Insurance Group K.S.C.P. | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | $ 403.4 | $ 380 | ||||
Insurance and reinsurance | Go Digit Infoworks Services Private Limited | ||||||
Investments in Associates | ||||||
Ownership percentage | 49% | 49% | ||||
Investments in associates, at fair value | $ 479.3 | $ 498.3 | ||||
Insurance and reinsurance | Go Digit Infoworks Services Private Limited | Total | ||||||
Investments in Associates | ||||||
Carrying value | 104.4 | 79.1 | ||||
Share of profit of associates | (11) | 5.3 | ||||
Insurance and reinsurance | Go Digit Infoworks Services Private Limited | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | 104.4 | 79.1 | ||||
Insurance and reinsurance | Other Insurance and Reinsurance | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 173.9 | 191.3 | ||||
Insurance and reinsurance | Other Insurance and Reinsurance | Total | ||||||
Investments in Associates | ||||||
Carrying value | 139.5 | 148.3 | ||||
Share of profit of associates | (11.6) | 11.8 | ||||
Insurance and reinsurance | Other Insurance and Reinsurance | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | 139.5 | 148.3 | ||||
Non-insurance | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 8,183.3 | 7,192.1 | ||||
Share of profit of associates | 134 | 22.3 | ||||
Non-insurance | Total | ||||||
Investments in Associates | ||||||
Carrying value | 6,786.6 | 5,496.6 | ||||
Share of profit of associates | 984.3 | 329.4 | ||||
Non-insurance | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | 5,444 | 4,147.7 | ||||
Non-insurance | Fairfax India associates | ||||||
Investments in Associates | ||||||
Carrying value | 1,342.6 | $ 1,348.9 | ||||
Non-insurance | IIFL Finance Limited | ||||||
Investments in Associates | ||||||
Ownership percentage | 22.30% | |||||
Non-insurance | Atlas Corp | ||||||
Investments in Associates | ||||||
Ownership percentage | 43.20% | |||||
Investments in associates, at fair value | $ 335.3 | |||||
Non-insurance | India | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 2,739.2 | $ 3,196.3 | ||||
Non-insurance | India | Total | ||||||
Investments in Associates | ||||||
Carrying value | 1,848.3 | 1,901.1 | ||||
Share of profit of associates | 142.5 | 32.6 | ||||
Non-insurance | India | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | 505.7 | 552.2 | ||||
Non-insurance | India | Fairfax India associates | ||||||
Investments in Associates | ||||||
Carrying value | $ 1,342.6 | $ 1,348.9 | ||||
Non-insurance | India | Bangalore International Airport Limited | ||||||
Investments in Associates | ||||||
Ownership percentage | 54% | 54% | ||||
Investments in associates, at fair value | $ 1,233.7 | $ 1,372.2 | ||||
Non-insurance | India | Bangalore International Airport Limited | Total | ||||||
Investments in Associates | ||||||
Carrying value | 521.1 | 585.8 | ||||
Share of profit of associates | (5.7) | (45.8) | ||||
Non-insurance | India | Bangalore International Airport Limited | Fairfax India associates | ||||||
Investments in Associates | ||||||
Carrying value | $ 521.1 | $ 585.8 | ||||
Non-insurance | India | Quess Corp Limited | ||||||
Investments in Associates | ||||||
Ownership percentage | 30.90% | 31% | ||||
Investments in associates, at fair value | $ 228.3 | $ 528.5 | ||||
Non-insurance | India | Quess Corp Limited | Total | ||||||
Investments in Associates | ||||||
Carrying value | 459.6 | 506.3 | ||||
Share of profit of associates | 6.8 | (1.4) | ||||
Non-insurance | India | Quess Corp Limited | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | $ 459.6 | $ 506.3 | ||||
Non-insurance | India | IIFL Finance Limited | ||||||
Investments in Associates | ||||||
Ownership percentage | 22.30% | 22.30% | ||||
Investments in associates, at fair value | $ 493.3 | $ 318.1 | ||||
Non-insurance | India | IIFL Finance Limited | Total | ||||||
Investments in Associates | ||||||
Carrying value | 242.8 | 198.8 | ||||
Share of profit of associates | 36.5 | 40.6 | ||||
Non-insurance | India | IIFL Finance Limited | Fairfax India associates | ||||||
Investments in Associates | ||||||
Carrying value | $ 242.8 | $ 198.8 | ||||
Non-insurance | India | Sanmar Chemicals Group | ||||||
Investments in Associates | ||||||
Ownership percentage | 42.90% | 42.90% | ||||
Investments in associates, at fair value | $ 337.8 | $ 421.2 | ||||
Non-insurance | India | Sanmar Chemicals Group | Total | ||||||
Investments in Associates | ||||||
Carrying value | 159.8 | 124.2 | ||||
Share of profit of associates | 36.4 | (2.4) | ||||
Non-insurance | India | Sanmar Chemicals Group | Fairfax India associates | ||||||
Investments in Associates | ||||||
Carrying value | $ 159.8 | $ 124.2 | ||||
Non-insurance | India | CSB Bank Limited | ||||||
Investments in Associates | ||||||
Ownership percentage | 49.70% | 49.70% | ||||
Investments in associates, at fair value | $ 223.3 | $ 227.6 | ||||
Non-insurance | India | CSB Bank Limited | Total | ||||||
Investments in Associates | ||||||
Carrying value | 194.5 | 180.8 | ||||
Share of profit of associates | 40.8 | 27.6 | ||||
Non-insurance | India | CSB Bank Limited | Fairfax India associates | ||||||
Investments in Associates | ||||||
Carrying value | $ 194.5 | $ 180.8 | ||||
Non-insurance | India | IIFL Securities Limited | ||||||
Investments in Associates | ||||||
Ownership percentage | 37.10% | 37.20% | ||||
Investments in associates, at fair value | $ 87.9 | $ 138 | ||||
Non-insurance | India | IIFL Securities Limited | Total | ||||||
Investments in Associates | ||||||
Carrying value | 133.2 | 136 | ||||
Share of profit of associates | 14.6 | 14 | ||||
Non-insurance | India | IIFL Securities Limited | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | 35.3 | 35 | ||||
Non-insurance | India | IIFL Securities Limited | Fairfax India associates | ||||||
Investments in Associates | ||||||
Carrying value | $ 97.9 | $ 101 | ||||
Non-insurance | India | Seven Islands Shipping Limited | ||||||
Investments in Associates | ||||||
Ownership percentage | 48.50% | 48.50% | ||||
Investments in associates, at fair value | $ 96.9 | $ 105.9 | ||||
Non-insurance | India | Seven Islands Shipping Limited | Total | ||||||
Investments in Associates | ||||||
Carrying value | 97.9 | 98.5 | ||||
Share of profit of associates | 9.8 | (0.5) | ||||
Non-insurance | India | Seven Islands Shipping Limited | Fairfax India associates | ||||||
Investments in Associates | ||||||
Carrying value | 97.9 | 98.5 | ||||
Non-insurance | India | Other, India | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 38 | 84.8 | ||||
Non-insurance | India | Other, India | Total | ||||||
Investments in Associates | ||||||
Carrying value | 39.4 | 70.7 | ||||
Share of profit of associates | 3.3 | 0.5 | ||||
Non-insurance | India | Other, India | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | 10.8 | 10.9 | ||||
Non-insurance | India | Other, India | Fairfax India associates | ||||||
Investments in Associates | ||||||
Carrying value | 28.6 | 59.8 | ||||
Non-insurance | Real estate | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 162.4 | 215.9 | ||||
Non-insurance | Real estate | Total | ||||||
Investments in Associates | ||||||
Carrying value | 164.4 | 216.8 | ||||
Share of profit of associates | 19.3 | (10.7) | ||||
Non-insurance | Real estate | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | 164.4 | 216.8 | ||||
Non-insurance | Real estate | KWF Real Estate Ventures Limited Partnerships | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 101.1 | 76.3 | ||||
Non-insurance | Real estate | KWF Real Estate Ventures Limited Partnerships | Total | ||||||
Investments in Associates | ||||||
Carrying value | 101.1 | 76.3 | ||||
Share of profit of associates | 16.5 | (9) | ||||
Non-insurance | Real estate | KWF Real Estate Ventures Limited Partnerships | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | 101.1 | 76.3 | ||||
Non-insurance | Real estate | Other, Real estate | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 61.3 | 139.6 | ||||
Non-insurance | Real estate | Other, Real estate | Total | ||||||
Investments in Associates | ||||||
Carrying value | 63.3 | 140.5 | ||||
Share of profit of associates | 2.8 | (1.7) | ||||
Non-insurance | Real estate | Other, Real estate | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | 63.3 | 140.5 | ||||
Non-insurance | Other | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 5,281.7 | 3,779.9 | ||||
Non-insurance | Other | Total | ||||||
Investments in Associates | ||||||
Carrying value | 4,773.9 | 3,378.7 | ||||
Share of profit of associates | 822.5 | 307.5 | ||||
Non-insurance | Other | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | $ 4,773.9 | $ 3,378.7 | ||||
Non-insurance | Other | Eurobank Ergasias Services & Holdings S.A | ||||||
Investments in Associates | ||||||
Ownership percentage | 32.20% | 32.20% | ||||
Investments in associates, at fair value | $ 1,344.5 | $ 1,210.3 | ||||
Non-insurance | Other | Eurobank Ergasias Services & Holdings S.A | Total | ||||||
Investments in Associates | ||||||
Carrying value | 1,507.6 | 1,298.5 | ||||
Share of profit of associates | 263 | 162.3 | ||||
Non-insurance | Other | Eurobank Ergasias Services & Holdings S.A | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | $ 1,507.6 | $ 1,298.5 | ||||
Non-insurance | Other | Atlas Corp | ||||||
Investments in Associates | ||||||
Ownership percentage | 43.20% | 36.70% | ||||
Investments in associates, at fair value | $ 1,864.7 | $ 1,285.8 | ||||
Non-insurance | Other | Atlas Corp | Total | ||||||
Investments in Associates | ||||||
Carrying value | 1,506.3 | 922.1 | ||||
Share of profit of associates | 258.2 | 69.5 | ||||
Non-insurance | Other | Atlas Corp | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | $ 1,506.3 | $ 922.1 | ||||
Non-insurance | Other | Resolute Forest Products Inc. | ||||||
Investments in Associates | ||||||
Ownership percentage | 32.20% | 32.30% | ||||
Investments in associates, at fair value | $ 508.5 | $ 377.1 | ||||
Non-insurance | Other | Resolute Forest Products Inc. | Total | ||||||
Investments in Associates | ||||||
Carrying value | 508.5 | 275.8 | ||||
Share of profit of associates | 159 | 75.9 | ||||
Non-insurance | Other | Resolute Forest Products Inc. | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | $ 508.5 | $ 275.8 | ||||
Non-insurance | Other | Stelco Holdings Inc. | ||||||
Investments in Associates | ||||||
Ownership percentage | 23.60% | |||||
Investments in associates, at fair value | $ 423.3 | |||||
Non-insurance | Other | Stelco Holdings Inc. | Total | ||||||
Investments in Associates | ||||||
Carrying value | 304.8 | |||||
Non-insurance | Other | Stelco Holdings Inc. | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | $ 304.8 | |||||
Non-insurance | Other | EXCO Resources, Inc | ||||||
Investments in Associates | ||||||
Ownership percentage | 44.40% | 43.30% | ||||
Investments in associates, at fair value | $ 544.8 | $ 267.2 | ||||
Non-insurance | Other | EXCO Resources, Inc | Total | ||||||
Investments in Associates | ||||||
Carrying value | 288.4 | 195.4 | ||||
Share of profit of associates | 81.9 | (41.2) | ||||
Non-insurance | Other | EXCO Resources, Inc | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | $ 288.4 | $ 195.4 | ||||
Non-insurance | Other | Helios Fairfax Partners Corporation | ||||||
Investments in Associates | ||||||
Ownership percentage | 34.40% | 34.40% | ||||
Investments in associates, at fair value | $ 104.1 | $ 116.2 | ||||
Non-insurance | Other | Helios Fairfax Partners Corporation | Total | ||||||
Investments in Associates | ||||||
Carrying value | 183.2 | 206.1 | ||||
Share of profit of associates | (23.9) | (1.2) | ||||
Non-insurance | Other | Helios Fairfax Partners Corporation | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | $ 183.2 | $ 206.1 | ||||
Non-insurance | Other | Peak Achievement Athletics | ||||||
Investments in Associates | ||||||
Ownership percentage | 42.60% | 42.60% | ||||
Investments in associates, at fair value | $ 195.3 | $ 181.2 | ||||
Non-insurance | Other | Peak Achievement Athletics | Total | ||||||
Investments in Associates | ||||||
Carrying value | 124.4 | 140.5 | ||||
Share of profit of associates | 7.7 | 13.3 | ||||
Non-insurance | Other | Peak Achievement Athletics | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | 124.4 | 140.5 | ||||
Non-insurance | Other | Partnerships, trusts and other | ||||||
Investments in Associates | ||||||
Investments in associates, at fair value | 296.5 | 342.1 | ||||
Non-insurance | Other | Partnerships, trusts and other | Total | ||||||
Investments in Associates | ||||||
Carrying value | 350.7 | 340.3 | ||||
Share of profit of associates | 76.6 | 28.9 | ||||
Non-insurance | Other | Partnerships, trusts and other | Associates and joint ventures | ||||||
Investments in Associates | ||||||
Carrying value | $ 350.7 | $ 340.3 |
Investments in Associates - Ins
Investments in Associates - Insurance and reinsurance associates and joint ventures (Details) - Insurance and reinsurance companies | Jul. 14, 2021 | Jun. 17, 2021 | Jun. 16, 2021 |
Eurolife | |||
Investments in Associates | |||
Ownership percentage | 80% | ||
Singapore Re | |||
Investments in Associates | |||
Ownership percentage | 94% | 28.20% |
Investments in Associates - Non
Investments in Associates - Non-insurance associates and joint ventures (Details) $ / shares in Units, shares in Millions, $ in Millions, $ in Millions, ₨ in Billions | 12 Months Ended | |||||||||||||||
Oct. 31, 2022 USD ($) $ / shares | Oct. 04, 2022 USD ($) | Aug. 31, 2022 USD ($) shares | Jul. 05, 2022 $ / shares | Jul. 04, 2022 | Apr. 06, 2022 USD ($) $ / shares shares | Sep. 16, 2021 USD ($) | Sep. 16, 2021 INR (₨) | Mar. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) $ / shares | Dec. 31, 2021 USD ($) | Dec. 31, 2021 INR (₨) | Aug. 31, 2022 CAD ($) shares | Aug. 23, 2021 USD ($) | Jun. 11, 2021 USD ($) $ / shares | Jun. 30, 2020 USD ($) | |
Investments in Associates | ||||||||||||||||
Cash purchase price | $ 363.5 | $ 175.4 | ||||||||||||||
Cash proceeds from sales of interests in associates | 192.9 | 809.2 | ||||||||||||||
Investments in associates | 7,433.9 | 6,104 | ||||||||||||||
Atlas Corp | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Number of shares acquired on exercise of warrants | shares | 25 | |||||||||||||||
Warrant exercise price (in dollars per share) | $ / shares | $ 8.05 | |||||||||||||||
Cash consideration for acquisition of equity warrants | $ 201.3 | |||||||||||||||
Realized gain on derecognition | 58.6 | |||||||||||||||
Unrealized gain on derecognition of investments related to prior period | $ 95.8 | |||||||||||||||
Percent of ownership interests sold | 45% | |||||||||||||||
Cash consideration for acquisition of shares, per share | $ / shares | $ 15.50 | |||||||||||||||
Resolute Forest Products Inc. | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Investments in associates, at fair value | $ 508.5 | |||||||||||||||
Cash consideration for acquisition of shares, per share | $ / shares | $ 20.50 | $ 20.50 | ||||||||||||||
Stelco Holdings Inc. | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Investments in associates, at fair value | $ 352.2 | $ 461.3 | ||||||||||||||
Number of shares repurchased from investor | shares | 5.1 | 5.1 | ||||||||||||||
Ownership percentage | 20.50% | |||||||||||||||
IIFL Finance Limited | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Cash proceeds from sales of interests in associates | 113.7 | ₨ 8.6 | ||||||||||||||
Poseidon Acquisitions Corp | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Cash proceeds from sales of interests in associates | $ 78.7 | |||||||||||||||
Fairfax India | Bangalore International Airport Limited | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Ownership percentage | 54% | 54% | ||||||||||||||
Percentage of ownership interest transferred | 43.60% | 43.60% | ||||||||||||||
Fairfax India | Anchorage Infrastructure Investments Holdings Limited | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Cash proceeds from sales of interests in associates | $ 129.2 | ₨ 9.5 | ||||||||||||||
Percentage of interest sold | 11.50% | 11.50% | ||||||||||||||
Non-insurance companies | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Investments in associates, at fair value | $ 8,183.3 | 7,192.1 | ||||||||||||||
Non-insurance companies | Grivalia Hospitality | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Ownership percentage | 78.40% | 33.50% | ||||||||||||||
Non-insurance companies | Atlas Corp | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Number of shares acquired on exercise of warrants | shares | 25 | |||||||||||||||
Warrant exercise price (in dollars per share) | $ / shares | $ 8.05 | |||||||||||||||
Cash consideration for acquisition of equity warrants | $ 201.3 | |||||||||||||||
Net loss on investments | 37.2 | |||||||||||||||
Realized gain on derecognition | 58.6 | |||||||||||||||
Unrealized gain on derecognition of investments related to prior period | 95.8 | |||||||||||||||
Investments in associates, at fair value | $ 335.3 | |||||||||||||||
Cash consideration for acquisition of shares | $ 84.8 | |||||||||||||||
Ownership percentage | 43.20% | |||||||||||||||
Non-insurance companies | Atlas Corp | Atlas Series J preferred shares and equity warrants | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Warrant exercise price (in dollars per share) | $ / shares | $ 13.71 | |||||||||||||||
Investments in associates | $ 575 | |||||||||||||||
Amount of principal exchanged | $ 288 | |||||||||||||||
Amount of redemption of debentures | $ 287 | |||||||||||||||
Non-insurance companies | IIFL Finance Limited | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Cash proceeds from sales of interests in associates | $ 113.7 | ₨ 8.6 | ||||||||||||||
Ownership percentage | 22.30% | 22.30% | ||||||||||||||
Net gain on sale of investments | $ 42 | |||||||||||||||
Non-insurance companies | Helios Fairfax Partners Corporation | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Warrant exercise price (in dollars per share) | $ / shares | $ 4.90 | |||||||||||||||
Investments in associates | $ 100 | |||||||||||||||
Interest rate of debentures | 3% | |||||||||||||||
Number of warrants to purchase shares | shares | 3 | |||||||||||||||
Non-insurance companies | Helios Fairfax Partners Corporation | Fairfax Africa legacy investments | ||||||||||||||||
Investments in Associates | ||||||||||||||||
Threshold maximum amount of investments at redemption or maturity | $ 102.6 | |||||||||||||||
Fair value of debentures | 78 | |||||||||||||||
Amount of debentures recorded to equity | $ 22 |
Investments in Associates - Ann
Investments in Associates - Annual changes in carrying value (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in the carrying value of investments in associates, including investment in associate held for sale | ||
Purchases and acquisitions | $ 363.5 | $ 175.4 |
Investments in associates | ||
Changes in the carrying value of investments in associates, including investment in associate held for sale | ||
Balance - January 1 | 6,104 | 6,439.6 |
Share of profit | 1,014.7 | 402 |
Share of other comprehensive income (loss), excluding gains (losses) on defined benefit plans | (150.1) | (87.9) |
Share of gains (losses) on defined benefit plans | 69.6 | 79.8 |
Share of pre-tax comprehensive income (loss) of associates and joint arrangements | 934.2 | 393.9 |
Dividends and distributions received | (182.9) | (182) |
Purchases and acquisitions | 527.8 | 616.6 |
Divestitures and other net changes in capitalization | 32.4 | (818.3) |
Reclassifications | 197.5 | (315.6) |
Foreign exchange effect and other | (179.1) | (30.2) |
Balance - December 31 | 7,433.9 | 6,104 |
Associates | ||
Changes in the carrying value of investments in associates, including investment in associate held for sale | ||
Balance - January 1 | 3,858.7 | 3,170.4 |
Share of profit | 856.6 | 375.8 |
Share of other comprehensive income (loss), excluding gains (losses) on defined benefit plans | (111.5) | (67.7) |
Share of gains (losses) on defined benefit plans | 74.4 | 89.1 |
Share of pre-tax comprehensive income (loss) of associates and joint arrangements | 819.5 | 397.2 |
Dividends and distributions received | (142.2) | (153.8) |
Purchases and acquisitions | 429.1 | 466.5 |
Divestitures and other net changes in capitalization | 9.9 | (54.8) |
Reclassifications | 352.2 | 36.4 |
Foreign exchange effect and other | (16.8) | (3.2) |
Balance - December 31 | 5,310.4 | 3,858.7 |
Joint ventures | ||
Changes in the carrying value of investments in associates, including investment in associate held for sale | ||
Balance - January 1 | 896.4 | 1,940.9 |
Share of profit | 26.1 | 6 |
Share of other comprehensive income (loss), excluding gains (losses) on defined benefit plans | (53) | (20.5) |
Share of gains (losses) on defined benefit plans | 0.6 | 0.1 |
Share of pre-tax comprehensive income (loss) of associates and joint arrangements | (26.3) | (14.4) |
Dividends and distributions received | (33.7) | (23.6) |
Purchases and acquisitions | 88.6 | 114.4 |
Divestitures and other net changes in capitalization | (11.9) | (764.4) |
Reclassifications | (114.3) | (352) |
Foreign exchange effect and other | (17.9) | (4.5) |
Balance - December 31 | 780.9 | 896.4 |
Fairfax India associates | ||
Changes in the carrying value of investments in associates, including investment in associate held for sale | ||
Balance - January 1 | 1,348.9 | 1,328.3 |
Share of profit | 132 | 20.2 |
Share of other comprehensive income (loss), excluding gains (losses) on defined benefit plans | 14.4 | 0.3 |
Share of gains (losses) on defined benefit plans | (5.4) | (9.4) |
Share of pre-tax comprehensive income (loss) of associates and joint arrangements | 141 | 11.1 |
Dividends and distributions received | (7) | (4.6) |
Purchases and acquisitions | 10.1 | 35.7 |
Divestitures and other net changes in capitalization | 34.4 | 0.9 |
Reclassifications | (40.4) | |
Foreign exchange effect and other | (144.4) | (22.5) |
Balance - December 31 | $ 1,342.6 | $ 1,348.9 |
Derivatives - Summary (Details)
Derivatives - Summary (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Derivatives | ||
Derivative financial assets | $ 467.8 | $ 581.8 |
Derivative financial liabilities | 191 | 152.9 |
Equity derivative contracts | ||
Derivatives | ||
Notional amount | 1,946.5 | 1,728.9 |
Cost | 68 | 113.9 |
Derivative financial assets | 258.1 | 355.3 |
Derivative financial liabilities | 19.4 | 3.8 |
Equity derivative contracts | Atlas Corp | ||
Derivatives | ||
Derivative financial assets | 13.5 | 200.1 |
RiverStone Barbados AVLNs | ||
Derivatives | ||
Notional amount | 517.5 | 1,250.1 |
Derivative financial assets | 30.7 | 103.8 |
Foreign currency derivative contracts | ||
Derivatives | ||
Derivative financial assets | 49 | 58.4 |
Derivative financial liabilities | 106.8 | 77.4 |
Foreign currency derivative contracts | AGT Food and Ingredients Inc. (AGT) | ||
Derivatives | ||
Derivative financial liabilities | 56.2 | 47.6 |
Other derivative contracts | ||
Derivatives | ||
Cost | 289.8 | 263.3 |
Derivative financial assets | 130 | 64.3 |
Derivative financial liabilities | $ 64.8 | $ 71.7 |
Derivatives - Equity derivative
Derivatives - Equity derivative contracts (Details) $ / shares in Units, $ / shares in Units, $ in Millions, $ in Millions | 12 Months Ended | ||||
Jul. 05, 2022 USD ($) | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2022 CAD ($) $ / shares shares | Dec. 31, 2021 CAD ($) $ / shares shares | |
Derivatives | |||||
Net gains (losses) on investments | $ (1,733.9) | $ 3,445.1 | |||
Guaranteed value of securities to CVC and certain affiliates | 486.8 | ||||
Derivative financial assets | 467.8 | 581.8 | |||
Long equity total return swaps | |||||
Derivatives | |||||
Cash received from settlement of derivative contracts | 238.2 | 439.6 | |||
Notional amount of derivatives settled | 63 | 1,876.7 | |||
Net gains (losses) on investments | (8.1) | 243 | |||
Equity total return swaps - long positions, investment purposes | |||||
Derivatives | |||||
Notional amount of equity contracts entered into during the period | 217.4 | ||||
Equity total return swaps - long positions, individual equities | |||||
Derivatives | |||||
Notional amount | 1,012.6 | 866.2 | |||
Equity total return swaps - long positions, individual equities | Fairfax subordinate voting shares | |||||
Derivatives | |||||
Notional amount | $ 732.5 | $ 732.5 | $ 935 | $ 935 | |
Number of shares under equity swap contracts (in shares) | shares | 1,964,155 | 1,964,155 | 1,964,155 | 1,964,155 | |
Notional amount per share (in dollars per share) | (per share) | $ 372.96 | $ 372.96 | $ 476.03 | $ 476.03 | |
Net gains (losses) on investments | $ 255.4 | $ 222.7 | |||
RiverStone Barbados AVLNs | |||||
Derivatives | |||||
Guaranteed value of securities to CVC and certain affiliates | $ 543.4 | 486.8 | 1,300 | ||
Derivative financial assets | $ 30.7 | $ 103.8 |
Derivatives - Other derivative
Derivatives - Other derivative contracts (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Derivatives | ||
Net gains (losses) on investments | $ (1,733.9) | $ 3,445.1 |
U.S. treasury bond forward contracts | ||
Derivatives | ||
Notional amount | 183.7 | 1,691.3 |
Net gains (losses) on investments | $ 162.4 | $ 25.7 |
Derivatives - Counterparty coll
Derivatives - Counterparty collateral (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Cash | Collateral deposits on derivative contracts for the benefit of the company | ||
Derivatives | ||
Financial assets pledged as collateral | $ 9.5 | $ 14.3 |
Holding company cash and investments | Collateral deposits on derivative contracts for the benefit of the derivative counterparties | ||
Derivatives | ||
Financial assets pledged as collateral | 155.9 | 230.5 |
Amount of collateral originally required for deposit | 124.8 | 221.2 |
Amount of collateral deposits attributable to changes in fair value since the most recent reset date | 31.1 | 9.3 |
Government securities | Collateral deposits on derivative contracts for the benefit of the company | ||
Derivatives | ||
Financial assets pledged as collateral | $ 274.9 | $ 125.7 |
Derivatives - Hedges (Details)
Derivatives - Hedges (Details) € in Millions, $ in Millions, $ in Millions | 12 Months Ended | |||||
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2022 CAD ($) | Dec. 31, 2022 EUR (€) | Dec. 31, 2021 CAD ($) | Dec. 31, 2021 EUR (€) | |
Derivatives | ||||||
Net gains (losses) on investments | $ (1,733.9) | $ 3,445.1 | ||||
Hedges of net investment in Canadian subsidiaries | Unsecured senior notes | ||||||
Derivatives | ||||||
Principal amount of hedged item | $ 2,800 | $ 2,800 | ||||
Fair value of hedged item | 1,926.8 | 2,364.6 | ||||
Net gains (losses) on investments | 149.5 | (16.7) | ||||
Hedges of net investment in European operations | Unsecured senior notes | ||||||
Derivatives | ||||||
Principal amount of hedged item | € | € 750 | € 750 | ||||
Fair value of hedged item | 698.3 | 926.3 | ||||
Net gains (losses) on investments | $ 51.8 | $ 63.9 |
Insurance Contract Liabilitie_2
Insurance Contract Liabilities - Summary by nature (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Insurance Contract Liabilities | ||||||||||
Total Insurance contract liabilities | $ 52,199.6 | $ 47,346.5 | ||||||||
Insurance contracts, gross | ||||||||||
Insurance Contract Liabilities | ||||||||||
Provision for unearned premiums | 11,691.8 | 10,437.7 | $ 8,397.5 | |||||||
Provision for losses and loss adjustment expenses | 38,319.2 | 34,422.8 | 30,809.3 | $ 28,500.2 | $ 29,081.7 | $ 28,610.8 | $ 19,481.8 | $ 19,816.4 | $ 17,749.1 | $ 19,212.8 |
Property and casualty insurance contract liabilities | 50,011 | 44,860.5 | ||||||||
Provision for life policy benefits | 2,188.6 | 2,486 | $ 0 | |||||||
Total Insurance contract liabilities | 52,199.6 | 47,346.5 | ||||||||
Provisions for unearned premiums for life policy benefits | 18.2 | 16.5 | ||||||||
Ceded reinsurance contracts | ||||||||||
Insurance Contract Liabilities | ||||||||||
Provision for unearned premiums | 2,413.1 | 2,260 | ||||||||
Provision for losses and loss adjustment expenses | 9,245.9 | 8,943.9 | ||||||||
Property and casualty insurance contract liabilities | 11,659 | 11,203.9 | ||||||||
Provision for life policy benefits | 2.6 | 2.3 | ||||||||
Total Insurance contract liabilities | 11,661.6 | 11,206.2 | ||||||||
Provisions for unearned premiums for life policy benefits | 0.4 | 0 | ||||||||
Insurance contracts, net | ||||||||||
Insurance Contract Liabilities | ||||||||||
Provision for unearned premiums | 9,278.7 | 8,177.7 | ||||||||
Provision for losses and loss adjustment expenses | 29,073.3 | 25,478.9 | ||||||||
Property and casualty insurance contract liabilities | 38,352 | 33,656.6 | ||||||||
Provision for life policy benefits | 2,186 | 2,483.7 | ||||||||
Total Insurance contract liabilities | 40,538 | 36,140.3 | ||||||||
Net loss reserves, case reserves | 10,933.9 | 10,258.5 | ||||||||
Net loss reserves, IBNR | $ 18,139.4 | $ 15,220.4 |
Insurance Contract Liabilitie_3
Insurance Contract Liabilities - Summary by classification (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Insurance Contract Liabilities | ||
Total Insurance contract liabilities | $ 52,199.6 | $ 47,346.5 |
Insurance contracts, gross | ||
Insurance Contract Liabilities | ||
Current | 23,807.9 | 20,618.3 |
Non-current | 28,391.7 | 26,728.2 |
Total Insurance contract liabilities | 52,199.6 | 47,346.5 |
Ceded reinsurance contracts | ||
Insurance Contract Liabilities | ||
Current | 5,052.4 | 4,740.3 |
Non-current | 6,609.2 | 6,465.9 |
Total Insurance contract liabilities | 11,661.6 | 11,206.2 |
Insurance contracts, net | ||
Insurance Contract Liabilities | ||
Current | 18,755.5 | 15,878 |
Non-current | 21,782.5 | 20,262.3 |
Total Insurance contract liabilities | $ 40,538 | $ 36,140.3 |
Insurance Contract Liabilitie_4
Insurance Contract Liabilities - Provision for unearned premiums, gross (Details) - Insurance contracts, gross - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Insurance Contract Liabilities | ||
Provision for unearned premiums - January 1 | $ 10,437.7 | $ 8,397.5 |
Gross premiums written | 27,561.7 | 23,796 |
Less: gross premiums earned | (26,106.7) | (21,673.6) |
Acquisitions of subsidiaries | 64.1 | |
Divestiture of subsidiary | (62.9) | |
Foreign exchange effect and other | (200.9) | (83.4) |
Provision for unearned premiums - December 31 | $ 11,691.8 | $ 10,437.7 |
Insurance Contract Liabilitie_5
Insurance Contract Liabilities - Provision for losses and loss adjustment expenses, gross (Details) - Insurance contracts, gross - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in the property and casualty provision for losses and loss adjustment expenses | ||
Provision for losses and loss adjustment expenses - January 1 | $ 34,422.8 | $ 30,809.3 |
Decrease in estimated losses and expenses for claims occurring in the prior years | (44) | (283.1) |
Losses and expenses for claims occurring in the current year | 17,300.2 | 14,396.8 |
Paid on claims occurring during: | ||
the current year | (3,978.6) | (3,148.6) |
the prior years | (8,734.7) | (7,212.8) |
Acquisitions of subsidiaries | 3.8 | 297.3 |
Divestiture of subsidiary | 0 | (18.7) |
Foreign exchange effect and other | (650.3) | (417.4) |
Provision for losses and loss adjustment expenses - December 31 | $ 38,319.2 | $ 34,422.8 |
Insurance Contract Liabilitie_6
Insurance Contract Liabilities - Provision for life policy benefits (Details) - Insurance contracts, gross - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Provision for life policy benefits | ||
Provision for life policy benefits - January 1 | $ 2,486 | $ 0 |
Acquisition of subsidiary | 2,638.5 | |
New business and renewals | 275.9 | 78.1 |
Surrenders, lapses, maturities and deaths | (359.4) | (121) |
Foreign exchange effect and other | (213.9) | (109.6) |
Provision for life policy benefits - December 31 | $ 2,188.6 | $ 2,486 |
Insurance Contract Liabilitie_7
Insurance Contract Liabilities - Development of insurance losses, gross (Details) - Insurance contracts, gross - USD ($) $ in Millions | 12 Months Ended | |||||||||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Insurance Contract Liabilities | ||||||||||
Provision for losses and loss adjustment expenses | $ 38,319.2 | $ 34,422.8 | $ 30,809.3 | $ 28,500.2 | $ 29,081.7 | $ 28,610.8 | $ 19,481.8 | $ 19,816.4 | $ 17,749.1 | $ 19,212.8 |
Less: CTR Life | 4.4 | 4.4 | 5.5 | 7 | 8 | 8.7 | 12.8 | 14.2 | 15.2 | 17.9 |
Provision for losses and loss adjustment expenses, net of CTR Life | 38,314.8 | 34,418.4 | 30,803.8 | 28,493.2 | 29,073.7 | 28,602.1 | 19,469 | 19,802.2 | 17,733.9 | 19,194.9 |
Effect of foreign currency translation | 443.3 | 425.6 | 452.9 | 395.7 | 759.2 | (84.5) | (129.1) | 326.8 | 522.8 | |
Favourable (adverse) loss reserve development | $ (44) | 44 | 110.8 | (201.9) | 606.5 | (154.1) | 349.8 | 1,064.7 | 811.6 | 829 |
Favourable (adverse) development | 487.3 | 536.4 | 251 | (210.8) | 605.1 | 265.3 | 935.6 | 1,138.4 | 1,351.8 | |
One year later | ||||||||||
Insurance Contract Liabilities | ||||||||||
Cumulative payments | 8,734.7 | 7,180.7 | 7,288.8 | 7,732 | 7,564 | 4,608 | 4,441.4 | 3,801.6 | 4,081.1 | |
Reserves re-estimated | $ 33,931.1 | 30,360.1 | 28,225.5 | 28,974.3 | 27,580.6 | 19,343.1 | 19,169.3 | 16,696.4 | 18,375.6 | |
Two years later | ||||||||||
Insurance Contract Liabilities | ||||||||||
Cumulative payments | 12,501.3 | 11,598 | 12,313.5 | 12,081.3 | 7,631.4 | 7,283.6 | 6,364.5 | 6,787.6 | ||
Reserves re-estimated | $ 30,267.4 | 28,165.4 | 28,839.4 | 27,565.9 | 18,804.8 | 18,973.6 | 16,269.2 | 17,475 | ||
Three years later | ||||||||||
Insurance Contract Liabilities | ||||||||||
Cumulative payments | 15,475.2 | 15,363.3 | 15,222.3 | 9,655.9 | 9,466.5 | 8,172.7 | 8,775.5 | |||
Reserves re-estimated | $ 28,242.2 | 28,990.4 | 27,451.3 | 18,752.8 | 18,502.5 | 16,114 | 17,307.9 | |||
Four years later | ||||||||||
Insurance Contract Liabilities | ||||||||||
Cumulative payments | 18,132.3 | 17,378.8 | 11,122.6 | 10,914.2 | 9,561.8 | 10,212.4 | ||||
Reserves re-estimated | $ 29,284.5 | 27,698.6 | 18,743.9 | 18,469.1 | 15,938.9 | 17,287.2 | ||||
Five years later | ||||||||||
Insurance Contract Liabilities | ||||||||||
Cumulative payments | 13,340.9 | 12,233.4 | 12,013.9 | 10,496.4 | 11,354.4 | |||||
Reserves re-estimated | $ 27,977 | 19,046.6 | 18,490.5 | 16,049.6 | 17,203.5 | |||||
Six years later | ||||||||||
Insurance Contract Liabilities | ||||||||||
Cumulative payments | 13,196.6 | 12,859.5 | 11,202.2 | 12,123.4 | ||||||
Reserves re-estimated | $ 19,203.7 | 18,759.5 | 16,123.1 | 17,340.1 | ||||||
Seven years later | ||||||||||
Insurance Contract Liabilities | ||||||||||
Cumulative payments | 13,568 | 11,793.5 | 12,754.2 | |||||||
Reserves re-estimated | $ 18,866.6 | 16,403.8 | 17,420 | |||||||
Eight years later | ||||||||||
Insurance Contract Liabilities | ||||||||||
Cumulative payments | 12,390.7 | 13,283.6 | ||||||||
Reserves re-estimated | $ 16,595.5 | 17,680.5 | ||||||||
Nine years later | ||||||||||
Insurance Contract Liabilities | ||||||||||
Cumulative payments | 13,840.6 | |||||||||
Reserves re-estimated | $ 17,843.1 |
Insurance Contract Liabilitie_8
Insurance Contract Liabilities - Development of losses and loss adjustment expenses for asbestos (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Insurance contracts, gross | ||
Changes in the company's provision for losses and loss adjustment expenses related to U.S. asbestos exposure | ||
Provision for asbestos claims and loss adjustment expenses - January 1 | $ 1,036.7 | $ 1,030.6 |
Losses and loss adjustment expenses incurred | 215.8 | 199.1 |
Losses and loss adjustment expenses paid | (175.2) | (193) |
Provision for asbestos claims and loss adjustment expenses - December 31 | 1,077.3 | 1,036.7 |
Insurance contracts, net | ||
Changes in the company's provision for losses and loss adjustment expenses related to U.S. asbestos exposure | ||
Provision for asbestos claims and loss adjustment expenses - January 1 | 838.9 | 840 |
Losses and loss adjustment expenses incurred | 113.7 | 151.6 |
Losses and loss adjustment expenses paid | (132.5) | (152.7) |
Provision for asbestos claims and loss adjustment expenses - December 31 | $ 820.1 | $ 838.9 |
Reinsurance - Reinsurers' share
Reinsurance - Reinsurers' share of insurance contract Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Reinsurance | |||
Provision for losses and loss adjustment expenses | $ 9,248.1 | $ 8,946.2 | |
Reinsurers' share of paid losses | 1,454.2 | 884.3 | |
Provision for unearned premiums | 2,413.5 | 2,260 | |
Total | 13,115.8 | 12,090.5 | $ 10,533.2 |
Current | 6,414.4 | 5,572.4 | |
Non-current | 6,701.4 | 6,518.1 | |
Gross recoverable from reinsurers | |||
Reinsurance | |||
Provision for losses and loss adjustment expenses | 9,274.8 | 8,989.3 | |
Reinsurers' share of paid losses | 1,599.4 | 1,019.9 | |
Provision for unearned premiums | 2,413.5 | 2,260 | |
Total | 13,287.7 | 12,269.2 | |
Provision for uncollectible reinsurance | |||
Reinsurance | |||
Provision for losses and loss adjustment expenses | (26.7) | (43.1) | |
Reinsurers' share of paid losses | (145.2) | (135.6) | |
Total | $ (171.9) | $ (178.7) | $ (155.6) |
Reinsurance - Reinsurers' sha_2
Reinsurance - Reinsurers' share of paid losses, unpaid losses, unearned premiums and the provision (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 01, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in reinsurers' share of paid losses, unpaid losses and unearned premiums, and the provision for uncollectible reinsurance | |||
Beginning balance - January 1 | $ 12,090.5 | $ 10,533.2 | |
Reinsurance recoveries received | (2,551) | (2,152.8) | |
Reinsurers' share of unpaid losses and premiums earned | (1,806.8) | (1,749.8) | |
Premiums ceded to reinsurers | 5,640.9 | 5,632.1 | |
Acquisitions of subsidiaries | 99.7 | ||
Divestiture of subsidiary | (20.3) | ||
Foreign exchange effect and other | (257.8) | (251.6) | |
Ending balance - December 31 | 13,115.8 | 12,090.5 | |
Commission income on premiums ceded | 1,184.4 | 1,007.8 | |
Brit | |||
Changes in reinsurers' share of paid losses, unpaid losses and unearned premiums, and the provision for uncollectible reinsurance | |||
Net insurance contract liabilities ceded | $ 379.1 | ||
Consideration for insurance liability ceded | 344.1 | ||
Net favorable reserve | $ 35 | ||
Paid losses | |||
Changes in reinsurers' share of paid losses, unpaid losses and unearned premiums, and the provision for uncollectible reinsurance | |||
Beginning balance - January 1 | 1,019.9 | 818 | |
Reinsurers' share of losses paid to insureds | 3,142.8 | 2,360.3 | |
Reinsurance recoveries received | (2,551) | (2,152.8) | |
Acquisitions of subsidiaries | 0.3 | ||
Divestiture of subsidiary | (3.3) | ||
Foreign exchange effect and other | (12.3) | (2.6) | |
Ending balance - December 31 | 1,599.4 | 1,019.9 | |
Unpaid losses | |||
Changes in reinsurers' share of paid losses, unpaid losses and unearned premiums, and the provision for uncollectible reinsurance | |||
Beginning balance - January 1 | 8,989.3 | 7,971.7 | |
Reinsurers' share of losses paid to insureds | 3,142.8 | 2,360.3 | |
Reinsurers' share of unpaid losses and premiums earned | 3,642 | 3,479 | |
Acquisitions of subsidiaries | 82.7 | ||
Divestiture of subsidiary | (6.4) | ||
Foreign exchange effect and other | (213.7) | (177.4) | |
Ending balance - December 31 | 9,274.8 | 8,989.3 | |
Unearned premiums | |||
Changes in reinsurers' share of paid losses, unpaid losses and unearned premiums, and the provision for uncollectible reinsurance | |||
Beginning balance - January 1 | 2,260 | 1,899.1 | |
Reinsurers' share of unpaid losses and premiums earned | (5,448.8) | (5,228.8) | |
Premiums ceded to reinsurers | 5,640.9 | 5,632.1 | |
Acquisitions of subsidiaries | 16.7 | ||
Divestiture of subsidiary | (10.6) | ||
Foreign exchange effect and other | (38.6) | (48.5) | |
Ending balance - December 31 | 2,413.5 | 2,260 | |
Provision for uncollectible reinsurance | |||
Changes in reinsurers' share of paid losses, unpaid losses and unearned premiums, and the provision for uncollectible reinsurance | |||
Beginning balance - January 1 | (178.7) | (155.6) | |
Foreign exchange effect and other | 6.8 | (23.1) | |
Ending balance - December 31 | $ (171.9) | $ (178.7) |
Insurance Contract Receivable_3
Insurance Contract Receivables and Payables - Summary of contract receivables (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Insurance Contract Receivables and Payables | |||
Insurance premiums receivable | $ 4,972.7 | $ 4,247.1 | $ 3,665.6 |
Reinsurance premiums receivable | 2,114.6 | 1,863.9 | $ 1,385.3 |
Funds withheld receivable | 550.6 | 574 | |
Other | 269.6 | 198.2 | |
Insurance contract receivables | 7,907.5 | 6,883.2 | |
Current | 7,330 | 6,170 | |
Non-current | $ 577.5 | $ 713.2 |
Insurance Contract Receivable_4
Insurance Contract Receivables and Payables - Changes in insurance premiums receivable and reinsurance premiums receivable (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Insurance premiums receivable | ||
Insurance premiums receivable, beginning balance | $ 4,247.1 | $ 3,665.6 |
Gross premiums written | 20,516.3 | 18,118.6 |
Premiums collected | (17,571.5) | (15,703.6) |
Amounts due to brokers and agents | (2,089.4) | (1,770.1) |
Foreign exchange effect and other | (129.8) | (63.4) |
Insurance premiums receivable, ending balance | 4,972.7 | 4,247.1 |
Reinsurance premiums receivable | ||
Reinsurance premiums receivable, beginning balance | 1,863.9 | 1,385.3 |
Gross premiums written | 7,396.3 | 5,791.6 |
Premiums collected | (5,366.6) | (3,963.7) |
Amounts due to brokers and agents | (1,806.1) | (1,332.3) |
Foreign exchange effect and other | 27.1 | (17) |
Reinsurance premiums receivable, ending balance | $ 2,114.6 | $ 1,863.9 |
Insurance Contract Receivable_5
Insurance Contract Receivables and Payables - Summary of insurance contract payables (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Insurance Contract Receivables and Payables | ||
Payable to reinsurers | $ 2,289.1 | $ 2,333.7 |
Payables associated with unit-linked life insurance products | 662.5 | 621.7 |
Ceded deferred premium acquisition costs | 564.6 | 510.3 |
Funds withheld payable to reinsurers | 193.5 | 274 |
Amounts payable to agents and brokers | 112.5 | 142.4 |
Accrued premium taxes | 105.7 | 124.1 |
Accrued commissions | 157.8 | 100.8 |
Other insurance contract payables | 976.2 | 386.5 |
Insurance contract payables | 5,061.9 | 4,493.5 |
Current | 4,101 | 3,503.4 |
Non-current | $ 960.9 | $ 990.1 |
Deferred Premium Acquisition _3
Deferred Premium Acquisition Costs (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in deferred premium acquisition costs | ||
Deferred premium acquisition costs, beginning balance | $ 1,924.1 | $ 1,543.7 |
Premium acquisition costs deferred | 5,212.5 | 4,502.4 |
Amortization | (4,932.2) | (4,098.1) |
Foreign exchange effect and other | (34.1) | (23.9) |
Deferred premium acquisition costs, ending balance | $ 2,170.3 | $ 1,924.1 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Changes in Goodwill and Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in goodwill and intangible assets | ||
Goodwill and intangible assets, beginning balance | $ 5,928.2 | $ 6,229.1 |
Additions | 445.2 | 370.7 |
Disposals | (125.2) | (125.5) |
Amortization | (226.6) | (439.4) |
Impairments | (137.9) | (85.3) |
Foreign exchange effect and other | (194.7) | (21.4) |
Goodwill and intangible assets, ending balance | 5,689 | 5,928.2 |
Intangible assets with indefinite useful life | 1,613.6 | 1,686.2 |
Farmers Edge | ||
Changes in goodwill and intangible assets | ||
Goodwill and intangible assets, beginning balance | 224.3 | |
Goodwill and intangible assets, ending balance | 74.7 | $ 224.3 |
Non-cash goodwill impairment charge | 133.4 | |
Fairfax India | Privi Speciality Chemicals Limited | ||
Changes in goodwill and intangible assets | ||
Percentage of interest sold | 48.80% | |
Goodwill | ||
Changes in goodwill and intangible assets | ||
Goodwill and intangible assets, beginning balance | 3,084.8 | $ 3,126.3 |
Additions | 152 | 60.7 |
Disposals | (81.9) | (28.9) |
Impairments | (137) | (52.1) |
Foreign exchange effect and other | (90.4) | (21.2) |
Goodwill and intangible assets, ending balance | 2,927.5 | 3,084.8 |
Lloyd's participation rights | ||
Changes in goodwill and intangible assets | ||
Goodwill and intangible assets, beginning balance | 503.2 | 503.2 |
Goodwill and intangible assets, ending balance | 503.2 | 503.2 |
Customer and broker relationships | ||
Changes in goodwill and intangible assets | ||
Goodwill and intangible assets, beginning balance | 760.9 | 867.5 |
Additions | 25.9 | 17.8 |
Disposals | (31.6) | (25.1) |
Amortization | (91.7) | (96.6) |
Foreign exchange effect and other | (9.6) | (2.7) |
Goodwill and intangible assets, ending balance | 653.9 | 760.9 |
Brand names | ||
Changes in goodwill and intangible assets | ||
Goodwill and intangible assets, beginning balance | 1,087.3 | 1,153.3 |
Additions | (0.3) | 27.9 |
Disposals | (8.5) | (64) |
Impairments | (33.1) | |
Foreign exchange effect and other | (60.2) | 3.2 |
Goodwill and intangible assets, ending balance | 1,018.3 | 1,087.3 |
Computer software and other | ||
Changes in goodwill and intangible assets | ||
Goodwill and intangible assets, beginning balance | 492 | 578.8 |
Additions | 267.6 | 264.3 |
Disposals | (3.2) | (7.5) |
Amortization | (134.9) | (342.8) |
Impairments | (0.9) | (0.1) |
Foreign exchange effect and other | (34.5) | (0.7) |
Goodwill and intangible assets, ending balance | $ 586.1 | $ 492 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Net (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Goodwill and Intangible Assets | |||
Gross carrying amount | $ 7,598.3 | $ 7,622 | |
Accumulated amortization | (1,619.9) | (1,492.8) | |
Accumulated impairment and other | (289.4) | (201) | |
Total | 5,689 | 5,928.2 | $ 6,229.1 |
Goodwill | |||
Goodwill and Intangible Assets | |||
Gross carrying amount | 3,161.8 | 3,214.1 | |
Accumulated impairment and other | (234.3) | (129.3) | |
Total | 2,927.5 | 3,084.8 | 3,126.3 |
Lloyd's participation rights | |||
Goodwill and Intangible Assets | |||
Gross carrying amount | 503.2 | 503.2 | |
Total | 503.2 | 503.2 | 503.2 |
Customer and broker relationships | |||
Goodwill and Intangible Assets | |||
Gross carrying amount | 1,279 | 1,338.5 | |
Accumulated amortization | (631.6) | (577.4) | |
Accumulated impairment and other | 6.5 | (0.2) | |
Total | 653.9 | 760.9 | 867.5 |
Brand names | |||
Goodwill and Intangible Assets | |||
Gross carrying amount | 1,060.1 | 1,139.2 | |
Accumulated impairment and other | (41.8) | (51.9) | |
Total | 1,018.3 | 1,087.3 | 1,153.3 |
Computer software and other | |||
Goodwill and Intangible Assets | |||
Gross carrying amount | 1,594.2 | 1,427 | |
Accumulated amortization | (988.3) | (915.4) | |
Accumulated impairment and other | (19.8) | (19.6) | |
Total | $ 586.1 | $ 492 | $ 578.8 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Allocation of Goodwill and Intangible Assets (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure of information for cash-generating units | |||
Goodwill | $ 2,927.5 | $ 3,084.8 | |
Intangible assets | 2,761.5 | 2,843.4 | |
Total | 5,689 | 5,928.2 | $ 6,229.1 |
Insurance and reinsurance companies | |||
Disclosure of information for cash-generating units | |||
Goodwill | 1,891.2 | 1,972.8 | |
Intangible assets | 1,513.4 | 1,614.2 | |
Total | 3,404.6 | 3,587 | |
Allied World | |||
Disclosure of information for cash-generating units | |||
Goodwill | 940 | 940 | |
Intangible assets | 519.8 | 565.8 | |
Total | 1,459.8 | 1,505.8 | |
Brit | |||
Disclosure of information for cash-generating units | |||
Goodwill | 214.6 | 215.6 | |
Intangible assets | 565.5 | 580.5 | |
Total | 780.1 | 796.1 | |
Zenith National | |||
Disclosure of information for cash-generating units | |||
Goodwill | 317.6 | 317.6 | |
Intangible assets | 77.7 | 84.4 | |
Total | 395.3 | 402 | |
Northbridge | |||
Disclosure of information for cash-generating units | |||
Goodwill | 81.6 | 94.9 | |
Intangible assets | 133.5 | 121.3 | |
Total | 215.1 | 216.2 | |
Crum & Forster | |||
Disclosure of information for cash-generating units | |||
Goodwill | 132.6 | 189.1 | |
Intangible assets | 57.8 | 91 | |
Total | 190.4 | 280.1 | |
Odyssey Group | |||
Disclosure of information for cash-generating units | |||
Goodwill | 119.7 | 119.7 | |
Intangible assets | 50.8 | 54.9 | |
Total | 170.5 | 174.6 | |
All other | |||
Disclosure of information for cash-generating units | |||
Goodwill | 85.1 | 95.9 | |
Intangible assets | 108.3 | 116.3 | |
Total | 193.4 | 212.2 | |
Non-insurance companies | |||
Disclosure of information for cash-generating units | |||
Goodwill | 1,036.3 | 1,112 | |
Intangible assets | 1,248.1 | 1,229.2 | |
Total | 2,284.4 | 2,341.2 | |
Recipe | |||
Disclosure of information for cash-generating units | |||
Goodwill | 298.9 | 321.2 | |
Intangible assets | 902.2 | 980.5 | |
Total | 1,201.1 | 1,301.7 | |
Boat Rocker | |||
Disclosure of information for cash-generating units | |||
Goodwill | 86.4 | 89.1 | |
Intangible assets | 184.8 | 90.2 | |
Total | 271.2 | 179.3 | |
AGT | |||
Disclosure of information for cash-generating units | |||
Goodwill | 147.6 | 154.4 | |
Intangible assets | 49.6 | 34.9 | |
Total | 197.2 | 189.3 | |
Thomas Cook India | |||
Disclosure of information for cash-generating units | |||
Goodwill | 127.7 | 142.1 | |
Intangible assets | 48.4 | 54.5 | |
Total | 176.1 | 196.6 | |
Farmers Edge | |||
Disclosure of information for cash-generating units | |||
Goodwill | 63.3 | 208.3 | |
Intangible assets | 11.4 | 16 | |
Total | 74.7 | 224.3 | |
All other | |||
Disclosure of information for cash-generating units | |||
Goodwill | 312.4 | 196.9 | |
Intangible assets | 51.7 | 53.1 | |
Total | $ 364.1 | $ 250 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Additional Information (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Minimum | |
Disclosure of information for cash-generating units | |
Growth rate used to extrapolate cash flow projections | 3% |
Maximum | |
Disclosure of information for cash-generating units | |
Growth rate used to extrapolate cash flow projections | 3.70% |
Farmers Edge Inc | |
Disclosure of information for cash-generating units | |
Non-cash goodwill impairment charge | $ 133.4 |
Insurance and reinsurance companies | |
Disclosure of information for cash-generating units | |
Investment return rate | 5% |
Insurance and reinsurance companies | Minimum | |
Disclosure of information for cash-generating units | |
Discount rate applied to cash flow projections | 9.30% |
Insurance and reinsurance companies | Maximum | |
Disclosure of information for cash-generating units | |
Discount rate applied to cash flow projections | 13.70% |
Non-insurance companies | Minimum | |
Disclosure of information for cash-generating units | |
Discount rate applied to cash flow projections | 10.50% |
Non-insurance companies | Maximum | |
Disclosure of information for cash-generating units | |
Discount rate applied to cash flow projections | 16.90% |
Other Assets (Details)
Other Assets (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Segmented Information | ||
Premises and equipment, right-of-use assets and non-insurance companies' investment property | $ 2,883.7 | $ 2,284 |
Assets associated with unit-linked insurance products | 676.5 | 637.1 |
Inventories | 668.2 | 547.3 |
Other revenue receivables | 638.9 | 508.4 |
Accrued interest and dividends | 317.2 | 215.1 |
Income tax, sales tax and subsidies receivable | 275.9 | 231.9 |
Prepaid expenses | 245.8 | 205.8 |
Finance lease receivables | 226.8 | 266.1 |
Prepaid losses on claims | 168.9 | 129.4 |
Pension surplus | 144.5 | 113.8 |
Receivable for securities sold but not yet settled | 11.2 | 135.4 |
Other | 824.1 | 847 |
Current | 2,626.5 | 2,333.6 |
Non-current | 4,455.2 | 3,787.7 |
Other assets | 7,081.7 | 6,121.3 |
Insurance and reinsurance companies | ||
Segmented Information | ||
Premises and equipment, right-of-use assets and non-insurance companies' investment property | 684 | 725.6 |
Assets associated with unit-linked insurance products | 676.5 | 637.1 |
Accrued interest and dividends | 313.7 | 211.4 |
Income tax, sales tax and subsidies receivable | 71.3 | 61.6 |
Prepaid expenses | 111 | 110.9 |
Finance lease receivables | 8.8 | 9.4 |
Prepaid losses on claims | 168.9 | 129.4 |
Pension surplus | 144.5 | 113.8 |
Receivable for securities sold but not yet settled | 11.2 | 135.4 |
Other | 738.5 | 791.1 |
Current | 993.9 | 989.9 |
Non-current | 1,934.5 | 1,935.8 |
Other assets | 2,928.4 | 2,925.7 |
Non-insurance companies | ||
Segmented Information | ||
Premises and equipment, right-of-use assets and non-insurance companies' investment property | 2,199.7 | 1,558.4 |
Inventories | 668.2 | 547.3 |
Other revenue receivables | 638.9 | 508.4 |
Accrued interest and dividends | 3.5 | 3.7 |
Income tax, sales tax and subsidies receivable | 204.6 | 170.3 |
Prepaid expenses | 134.8 | 94.9 |
Finance lease receivables | 218 | 256.7 |
Other | 85.6 | 55.9 |
Current | 1,632.6 | 1,343.7 |
Non-current | 2,520.7 | 1,851.9 |
Other assets | $ 4,153.3 | $ 3,195.6 |
Account Payable and Accrued Lia
Account Payable and Accrued Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Accounts Payable and Accrued Liabilities | ||
Lease liabilities | $ 1,094 | $ 1,140.7 |
Payables related to cost of sales | 814.3 | 580.9 |
Salaries and employee benefit liabilities | 599 | 568.2 |
Amounts withheld and accrued taxes | 486.5 | 477.7 |
Deferred gift card, hospitality and other revenue | 429.8 | 353.9 |
Income taxes payable | 361 | 175 |
Pension and post retirement liabilities | 145.7 | 253.9 |
Administrative and other | 1,284.9 | 1,435.1 |
Accounts payable and accrued liabilities | 5,215.2 | 4,985.4 |
Current | 3,081.7 | 2,715.9 |
Non-current | 2,133.5 | 2,269.5 |
Insurance and reinsurance companies | ||
Accounts Payable and Accrued Liabilities | ||
Lease liabilities | 364.1 | 384.2 |
Salaries and employee benefit liabilities | 500.5 | 482.6 |
Amounts withheld and accrued taxes | 455.8 | 453.9 |
Deferred gift card, hospitality and other revenue | 37.8 | 35.4 |
Income taxes payable | 347 | 163.8 |
Pension and post retirement liabilities | 132.9 | 237.4 |
Administrative and other | 946.6 | 1,150.9 |
Accounts payable and accrued liabilities | 2,784.7 | 2,908.2 |
Current | 1,528.4 | 1,538.7 |
Non-current | 1,256.3 | 1,369.5 |
Non-insurance companies | ||
Accounts Payable and Accrued Liabilities | ||
Lease liabilities | 729.9 | 756.5 |
Payables related to cost of sales | 814.3 | 580.9 |
Salaries and employee benefit liabilities | 98.5 | 85.6 |
Amounts withheld and accrued taxes | 30.7 | 23.8 |
Deferred gift card, hospitality and other revenue | 392 | 318.5 |
Income taxes payable | 14 | 11.2 |
Pension and post retirement liabilities | 12.8 | 16.5 |
Administrative and other | 338.3 | 284.2 |
Accounts payable and accrued liabilities | 2,430.5 | 2,077.2 |
Current | 1,553.3 | 1,177.2 |
Non-current | $ 877.2 | $ 900 |
Borrowings - Summary (Details)
Borrowings - Summary (Details) € in Millions, £ in Millions, $ in Millions, $ in Millions | Dec. 31, 2022 USD ($) | Dec. 31, 2022 CAD ($) | Dec. 31, 2022 EUR (€) | Dec. 31, 2022 GBP (£) | Aug. 16, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 CAD ($) | Dec. 31, 2021 EUR (€) | Dec. 31, 2021 GBP (£) | Dec. 31, 2020 USD ($) |
Borrowings | ||||||||||
Carrying value | $ 8,624.9 | $ 7,753 | $ 8,814 | |||||||
Fair value | 8,049.8 | 8,291.9 | ||||||||
Borrowings | ||||||||||
Borrowings | ||||||||||
Principal | 8,673.5 | 7,802.3 | ||||||||
Holding company | ||||||||||
Borrowings | ||||||||||
Principal | 5,932.6 | 5,385.2 | ||||||||
Carrying value | 5,887.6 | 5,338.6 | 5,580.6 | |||||||
Fair value | 5,454.6 | 5,850.5 | ||||||||
Holding company | 4.875% due August 13, 2024 | ||||||||||
Borrowings | ||||||||||
Principal | $ 282.5 | $ 282.5 | ||||||||
Interest rate | 4.875% | 4.875% | 4.875% | 4.875% | 4.875% | 4.875% | 4.875% | 4.875% | ||
Carrying value | $ 281.6 | $ 281.1 | ||||||||
Fair value | 277 | 301.7 | ||||||||
Holding company | 4.95% due March 3, 2025 (Cdn$350.0) | ||||||||||
Borrowings | ||||||||||
Principal | $ 258.3 | $ 350 | $ 277.1 | $ 350 | ||||||
Interest rate | 4.95% | 4.95% | 4.95% | 4.95% | 4.95% | 4.95% | 4.95% | 4.95% | ||
Carrying value | $ 257.2 | $ 275.4 | ||||||||
Fair value | 255.2 | 299.6 | ||||||||
Holding company | 8.30% due April 15, 2026 | ||||||||||
Borrowings | ||||||||||
Principal | $ 91.8 | $ 91.8 | ||||||||
Interest rate | 8.30% | 8.30% | 8.30% | 8.30% | 8.30% | 8.30% | 8.30% | 8.30% | ||
Carrying value | $ 91.7 | $ 91.7 | ||||||||
Fair value | 98.2 | 113.3 | ||||||||
Holding company | 4.70% due December 16, 2026 (Cdn$450.0) | ||||||||||
Borrowings | ||||||||||
Principal | $ 332.1 | $ 450 | $ 356.3 | $ 450 | ||||||
Interest rate | 4.70% | 4.70% | 4.70% | 4.70% | 4.70% | 4.70% | 4.70% | 4.70% | ||
Carrying value | $ 331 | $ 354.8 | ||||||||
Fair value | 323.7 | 387.9 | ||||||||
Holding company | 4.25% due December 6, 2027 (Cdn$650.0) | ||||||||||
Borrowings | ||||||||||
Principal | $ 479.7 | $ 650 | $ 514.6 | $ 650 | ||||||
Interest rate | 4.25% | 4.25% | 4.25% | 4.25% | 4.25% | 4.25% | 4.25% | 4.25% | ||
Carrying value | $ 478.6 | $ 513.1 | ||||||||
Fair value | 455.8 | 551.4 | ||||||||
Holding company | 2.75% due March 29, 2028 (750.0 EUR) | ||||||||||
Borrowings | ||||||||||
Principal | $ 800.5 | € 750 | $ 852.9 | € 750 | ||||||
Interest rate | 2.75% | 2.75% | 2.75% | 2.75% | 2.75% | 2.75% | 2.75% | 2.75% | ||
Carrying value | $ 792.2 | $ 842.4 | ||||||||
Fair value | 698.3 | 926.3 | ||||||||
Holding company | 4.85% due April 17, 2028 | ||||||||||
Borrowings | ||||||||||
Principal | $ 600 | $ 600 | ||||||||
Interest rate | 4.85% | 4.85% | 4.85% | 4.85% | 4.85% | 4.85% | 4.85% | 4.85% | ||
Carrying value | $ 596.9 | $ 596.3 | ||||||||
Fair value | 568.1 | 668.5 | ||||||||
Holding company | 4.23% due June 14, 2029 (Cdn$500.0) | ||||||||||
Borrowings | ||||||||||
Principal | $ 369 | $ 500 | $ 395.8 | $ 500 | ||||||
Interest rate | 4.23% | 4.23% | 4.23% | 4.23% | 4.23% | 4.23% | 4.23% | 4.23% | ||
Carrying value | $ 367.7 | $ 394.2 | ||||||||
Fair value | 342.7 | 424.4 | ||||||||
Holding company | 4.625% due April 29, 2030 | ||||||||||
Borrowings | ||||||||||
Principal | $ 650 | $ 650 | ||||||||
Interest rate | 4.625% | 4.625% | 4.625% | 4.625% | 4.625% | 4.625% | 4.625% | 4.625% | ||
Carrying value | $ 646.4 | $ 645.9 | ||||||||
Fair value | 591.1 | 730 | ||||||||
Holding company | 3.375% due March 3, 2031 | ||||||||||
Borrowings | ||||||||||
Principal | $ 600 | $ 600 | ||||||||
Interest rate | 3.375% | 3.375% | 3.375% | 3.375% | 3.375% | 3.375% | 3.375% | 3.375% | ||
Carrying value | $ 586.8 | $ 585.1 | ||||||||
Fair value | 492.8 | 620.7 | ||||||||
Holding company | 3.95% due March 3, 2031 (Cdn$850.0) | ||||||||||
Borrowings | ||||||||||
Principal | $ 627.4 | $ 850 | $ 672.9 | $ 850 | ||||||
Interest rate | 3.95% | 3.95% | 3.95% | 3.95% | 3.95% | 3.95% | 3.95% | 3.95% | ||
Carrying value | $ 623.2 | $ 668 | ||||||||
Fair value | 549.4 | 701.3 | ||||||||
Holding company | 5.625% due August 16, 2032 | ||||||||||
Borrowings | ||||||||||
Principal | $ 750 | $ 750 | ||||||||
Interest rate | 5.625% | 5.625% | 5.625% | 5.625% | 5.625% | |||||
Carrying value | $ 743.6 | |||||||||
Fair value | 707.1 | |||||||||
Holding company | 7.75% due July 15, 2037 | ||||||||||
Borrowings | ||||||||||
Principal | $ 91.3 | $ 91.3 | ||||||||
Interest rate | 7.75% | 7.75% | 7.75% | 7.75% | 7.75% | 7.75% | 7.75% | 7.75% | ||
Carrying value | $ 90.7 | $ 90.6 | ||||||||
Fair value | 95.2 | 125.4 | ||||||||
Insurance and reinsurance companies | ||||||||||
Borrowings | ||||||||||
Carrying value | 733.4 | 790.7 | 1,033.4 | |||||||
Fair value | 663.7 | 815.8 | ||||||||
Insurance and reinsurance companies | Borrowings | ||||||||||
Borrowings | ||||||||||
Principal | 727.7 | 783.8 | ||||||||
Insurance and reinsurance companies | Allied World 4.35% senior notes due October 29, 2025 | ||||||||||
Borrowings | ||||||||||
Principal | $ 500 | $ 500 | ||||||||
Interest rate | 4.35% | 4.35% | 4.35% | 4.35% | 4.35% | 4.35% | 4.35% | 4.35% | ||
Carrying value | $ 502.9 | $ 503.9 | ||||||||
Fair value | 477.7 | 536.9 | ||||||||
Insurance and reinsurance companies | Allied World revolving credit facility and other borrowings | ||||||||||
Borrowings | ||||||||||
Principal | 16.8 | 17.4 | ||||||||
Carrying value | 19.8 | 20.6 | ||||||||
Fair value | 16.9 | 21.1 | ||||||||
Insurance and reinsurance companies | Zenith National 8.55% debentures due August 1, 2028 | ||||||||||
Borrowings | ||||||||||
Principal | $ 38.5 | $ 38.5 | ||||||||
Interest rate | 8.55% | 8.55% | 8.55% | 8.55% | 8.55% | 8.55% | 8.55% | 8.55% | ||
Carrying value | $ 38.3 | $ 38.3 | ||||||||
Fair value | 38.5 | 38.3 | ||||||||
Insurance and reinsurance companies | Brit 3.6757% subordinated notes due December 9, 2030 (£135.0) | ||||||||||
Borrowings | ||||||||||
Principal | $ 162.4 | £ 135 | $ 182.9 | £ 135 | ||||||
Interest rate | 3.6757% | 3.6757% | 3.6757% | 3.6757% | 3.6757% | 3.6757% | 3.6757% | 3.6757% | ||
Carrying value | $ 162.4 | $ 182.9 | ||||||||
Fair value | 120.6 | 174.5 | ||||||||
Insurance and reinsurance companies | Brit floating rate revolving credit facility | ||||||||||
Borrowings | ||||||||||
Principal | 10 | 45 | ||||||||
Carrying value | 10 | 45 | ||||||||
Fair value | 10 | 45 | ||||||||
Non-insurance companies | ||||||||||
Borrowings | ||||||||||
Carrying value | 2,003.9 | 1,623.7 | $ 2,200 | |||||||
Fair value | 1,931.5 | 1,625.6 | ||||||||
Non-insurance companies | Borrowings | ||||||||||
Borrowings | ||||||||||
Principal | 2,013.2 | 1,633.3 | ||||||||
Non-insurance companies | Fairfax India 5.00% unsecured senior notes due 2028 | ||||||||||
Borrowings | ||||||||||
Principal | $ 441.6 | $ 441.6 | ||||||||
Interest rate | 5% | 5% | 5% | 5% | 5% | 5% | 5% | 5% | ||
Carrying value | $ 438.9 | $ 438.4 | ||||||||
Fair value | 400.7 | 440.3 | ||||||||
Non-insurance companies | Fairfax India subsidiary borrowings | ||||||||||
Borrowings | ||||||||||
Principal | 122.6 | 91.9 | ||||||||
Carrying value | 122.2 | 91.3 | ||||||||
Fair value | 122.2 | 91.3 | ||||||||
Non-insurance companies | AGT credit facilities, senior notes and loans | ||||||||||
Borrowings | ||||||||||
Principal | 511.9 | 491.8 | ||||||||
Carrying value | 508.4 | 488.9 | ||||||||
Fair value | 498.8 | 488.9 | ||||||||
Non-insurance companies | Recipe term loans and credit facilities | ||||||||||
Borrowings | ||||||||||
Principal | 464 | 359 | ||||||||
Carrying value | 461.5 | 356.9 | ||||||||
Fair value | 436.7 | 356.9 | ||||||||
Non-insurance companies | Boat Rocker demand loans and revolving credit facilities | ||||||||||
Borrowings | ||||||||||
Principal | 155.4 | 93.8 | ||||||||
Carrying value | 155.2 | 93.1 | ||||||||
Fair value | 155.4 | 93.1 | ||||||||
Non-insurance companies | Loans and revolving credit facilities primarily at floating rates | ||||||||||
Borrowings | ||||||||||
Principal | 317.7 | 155.2 | ||||||||
Carrying value | 317.7 | 155.1 | ||||||||
Fair value | $ 317.7 | $ 155.1 |
Borrowings - New Transactions (
Borrowings - New Transactions (Details) - Holding company - USD ($) $ in Millions | 12 Months Ended | |||
Aug. 16, 2022 | Dec. 31, 2022 | Jun. 29, 2022 | Dec. 31, 2021 | |
Borrowings | ||||
Notional amount | $ 5,932.6 | $ 5,385.2 | ||
Grivalia Hospitality | ||||
Borrowings | ||||
Borrowings included in consolidation | 111.3 | |||
5.625% due August 16, 2032 | ||||
Borrowings | ||||
Notional amount | $ 750 | $ 750 | ||
Interest rate | 5.625% | 5.625% | ||
Net proceeds from borrowings | $ 743.4 | $ 743.4 | ||
Borrowing costs incurred | $ 5.5 | |||
Unsecured revolving credit facility | ||||
Borrowings | ||||
Notional amount | $ 2,000 |
Borrowings - Changes in the car
Borrowings - Changes in the carrying values of borrowings (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in the carrying values of borrowings | ||
Balance - January 1 | $ 7,753 | $ 8,814 |
Cash inflows from issuances | 790.4 | 1,749.1 |
Cash outflows from repayments | (25.6) | (1,526.8) |
Net cash inflows (outflows) from credit facilities and short term loans | 269.1 | (1,046.3) |
Non-cash changes: | ||
Acquisition of subsidiaries | 137.1 | |
Deconsolidation of subsidiary | (209.9) | |
Loss on redemption | 45.6 | |
Foreign exchange effect and other | (299.1) | (72.7) |
Balance - December 31 | 8,624.9 | 7,753 |
Holding company | ||
Changes in the carrying values of borrowings | ||
Balance - January 1 | 5,338.6 | 5,580.6 |
Cash inflows from issuances | 743.4 | 1,250 |
Cash outflows from repayments | (801.2) | |
Net cash inflows (outflows) from credit facilities and short term loans | (700) | |
Non-cash changes: | ||
Loss on redemption | 45.7 | |
Foreign exchange effect and other | (194.4) | (36.5) |
Balance - December 31 | 5,887.6 | 5,338.6 |
Insurance and reinsurance companies | ||
Changes in the carrying values of borrowings | ||
Balance - January 1 | 790.7 | 1,033.4 |
Cash outflows from repayments | (0.3) | (131.7) |
Net cash inflows (outflows) from credit facilities and short term loans | (35) | (84.3) |
Non-cash changes: | ||
Deconsolidation of subsidiary | (22.5) | |
Foreign exchange effect and other | (22) | (4.2) |
Balance - December 31 | 733.4 | 790.7 |
Non-insurance companies | ||
Changes in the carrying values of borrowings | ||
Balance - January 1 | 1,623.7 | 2,200 |
Cash inflows from issuances | 47 | 499.1 |
Cash outflows from repayments | (25.3) | (593.9) |
Net cash inflows (outflows) from credit facilities and short term loans | 304.1 | (262) |
Non-cash changes: | ||
Acquisition of subsidiaries | 137.1 | |
Deconsolidation of subsidiary | (187.4) | |
Loss on redemption | (0.1) | |
Foreign exchange effect and other | (82.7) | (32) |
Balance - December 31 | $ 2,003.9 | $ 1,623.7 |
Borrowings - Principal Payments
Borrowings - Principal Payments (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Borrowings | |
Principal repayments on borrowings | $ 8,673.5 |
2023 | |
Borrowings | |
Principal repayments on borrowings | 372.1 |
2024 | |
Borrowings | |
Principal repayments on borrowings | 1,031 |
2025 | |
Borrowings | |
Principal repayments on borrowings | 802.3 |
2026 | |
Borrowings | |
Principal repayments on borrowings | 455.1 |
2027 | |
Borrowings | |
Principal repayments on borrowings | 510.4 |
Thereafter | |
Borrowings | |
Principal repayments on borrowings | 5,502.6 |
Holding company | |
Borrowings | |
Principal repayments on borrowings | 5,932.6 |
Holding company | 2024 | |
Borrowings | |
Principal repayments on borrowings | 282.5 |
Holding company | 2025 | |
Borrowings | |
Principal repayments on borrowings | 258.3 |
Holding company | 2026 | |
Borrowings | |
Principal repayments on borrowings | 423.9 |
Holding company | 2027 | |
Borrowings | |
Principal repayments on borrowings | 479.7 |
Holding company | Thereafter | |
Borrowings | |
Principal repayments on borrowings | 4,488.2 |
Insurance and reinsurance companies | |
Borrowings | |
Principal repayments on borrowings | 727.7 |
Insurance and reinsurance companies | 2023 | |
Borrowings | |
Principal repayments on borrowings | 0.3 |
Insurance and reinsurance companies | 2024 | |
Borrowings | |
Principal repayments on borrowings | 0.3 |
Insurance and reinsurance companies | 2025 | |
Borrowings | |
Principal repayments on borrowings | 510.3 |
Insurance and reinsurance companies | 2026 | |
Borrowings | |
Principal repayments on borrowings | 0.3 |
Insurance and reinsurance companies | 2027 | |
Borrowings | |
Principal repayments on borrowings | 0.3 |
Insurance and reinsurance companies | Thereafter | |
Borrowings | |
Principal repayments on borrowings | 216.2 |
Non-insurance companies | |
Borrowings | |
Principal repayments on borrowings | 2,013.2 |
Non-insurance companies | 2023 | |
Borrowings | |
Principal repayments on borrowings | 371.8 |
Non-insurance companies | 2024 | |
Borrowings | |
Principal repayments on borrowings | 748.2 |
Non-insurance companies | 2025 | |
Borrowings | |
Principal repayments on borrowings | 33.7 |
Non-insurance companies | 2026 | |
Borrowings | |
Principal repayments on borrowings | 30.9 |
Non-insurance companies | 2027 | |
Borrowings | |
Principal repayments on borrowings | 30.4 |
Non-insurance companies | Thereafter | |
Borrowings | |
Principal repayments on borrowings | $ 798.2 |
Borrowings - Interest Expense (
Borrowings - Interest Expense (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Borrowings | ||
Interest expense | $ 452.8 | $ 513.9 |
Interest expense on lease liabilities | 46.9 | 57.9 |
Holding company and insurance and reinsurance companies | ||
Borrowings | ||
Interest expense on borrowings | 316.1 | 356.8 |
Non-insurance companies | ||
Borrowings | ||
Interest expense | 122.8 | 140.3 |
Interest expense on borrowings | 89.8 | 99.2 |
Loss on redemption as interest expense | 45.7 | |
Interest expense on lease liabilities | $ 46.9 | $ 57.9 |
Total Equity - Authorized and I
Total Equity - Authorized and Issued capital (Details) - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Multiple voting shares | ||
Total Equity | ||
Voting percentage of multiple voting shares | 41.80% | |
Number of shares issued | 1,548,000 | 1,548,000 |
Fairfax subordinate voting shares | ||
Total Equity | ||
Number of shares issued | 24,598,380 | 24,986,170 |
Number of shares reserved for share-based payments | 2,021,845 | 1,869,340 |
Total Equity - Common Stock, Nu
Total Equity - Common Stock, Number of shares outstanding (Details) - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Common shares | ||
Number of shares outstanding: | ||
Beginning balance, shares outstanding (in shares) | 23,865,600 | |
Ending balance, shares outstanding (in shares) | 23,325,305 | 23,865,600 |
Multiple and subordinate voting shares | ||
Number of shares outstanding: | ||
Interest in multiple and subordinate voting shares held through ownership interest in shareholder | (799,230) | (799,230) |
Fairfax subordinate voting shares | ||
Number of shares outstanding: | ||
Beginning balance, shares outstanding (in shares) | 23,116,830 | 25,427,736 |
Purchases for cancellation (in shares) | (387,790) | (2,137,923) |
Treasury shares acquired (in shares) | (295,474) | (293,197) |
Treasury shares reissued (in shares) | 142,969 | 120,214 |
Ending balance, shares outstanding (in shares) | 22,576,535 | 23,116,830 |
Multiple voting shares | ||
Number of shares outstanding: | ||
Beginning balance, shares outstanding (in shares) | 1,548,000 | 1,548,000 |
Ending balance, shares outstanding (in shares) | 1,548,000 | 1,548,000 |
Total Equity - Common stock - n
Total Equity - Common stock - narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 29, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Total Equity | |||
Reduction of issued capital purchases for cancellation | $ 199.6 | $ 1,058.1 | |
Fairfax subordinate voting shares | |||
Total Equity | |||
Purchases for cancellation (in shares) | 387,790 | 2,137,923 | |
Treasury shares acquired (in shares) | 295,474 | 293,197 | |
Value of treasury shares purchased | $ 148.2 | $ 132.6 | |
Fairfax subordinate voting shares | Normal course issuer bids | |||
Total Equity | |||
Purchases for cancellation (in shares) | 387,790 | 137,923 | |
Cost of shares purchased for cancellation | $ 199.6 | $ 58.1 | |
Fairfax subordinate voting shares | Substantial issuer bid | |||
Total Equity | |||
Purchases for cancellation (in shares) | 2,000,000 | ||
Purchases for cancellation (in dollars per share) | $ 500 | ||
Cash paid for stock repurchase | $ 1,000 | ||
Reduction of issued capital purchases for cancellation | 504.6 | ||
Additional paid-up capital | $ 495.4 | ||
Retained earnings | |||
Total Equity | |||
Reduction of issued capital purchases for cancellation | 103.5 | 528.5 | |
Retained earnings | Normal course issuer bids | |||
Total Equity | |||
Reduction of issued capital purchases for cancellation | $ 103.5 | $ 23.9 |
Total Equity - Dividends Paid (
Total Equity - Dividends Paid (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||||
Jan. 26, 2023 | Jan. 27, 2022 | Jan. 21, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Total Equity | |||||
Dividend per share (in dollars per share) | $ 10 | $ 10 | |||
Total cash payment | $ 513.1 | $ 427.5 | |||
Multiple and subordinate voting shares | |||||
Total Equity | |||||
Dividend per share (in dollars per share) | $ 10 | $ 10 | $ 10 | ||
Total cash payment | $ 245.2 | $ 249.9 | $ 272.1 |
Total Equity - Preferred Shares
Total Equity - Preferred Shares (Details) $ / shares in Units, $ / shares in Units, $ in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) | Dec. 31, 2022 CAD ($) $ / shares shares | |
Total Equity | |||
Dividends paid | $ | $ 45.2 | $ 44.5 | |
Preferred shares | |||
Total Equity | |||
Stated capital | $ 1,335.5 | 1,335.5 | $ 1,456 |
Liquidation preference per share (in dollars per share) | $ 25 | ||
Floating dividend payment basis | three-month Government of Canada treasury bill yield | ||
Dividends paid | $ | $ 45.2 | $ 44.5 | |
Series C | |||
Total Equity | |||
Number of shares outstanding (in shares) | shares | 7,515,642 | 7,515,642 | |
Stated capital | $ 170.8 | $ 187.9 | |
Liquidation preference per share (in dollars per share) | $ 25 | ||
Fixed dividend rate per annum | 4.71% | ||
Series D | |||
Total Equity | |||
Number of shares outstanding (in shares) | shares | 2,484,358 | 2,484,358 | |
Stated capital | $ 56.4 | $ 62.1 | |
Liquidation preference per share (in dollars per share) | $ 25 | ||
Floating dividend rate per annum | 7.28% | ||
Adjustment to floating rate basis for payment of dividends | 3.15% | 3.15% | |
Series E | |||
Total Equity | |||
Number of shares outstanding (in shares) | shares | 5,440,132 | 5,440,132 | |
Stated capital | $ 124.5 | $ 136 | |
Liquidation preference per share (in dollars per share) | $ 25 | ||
Fixed dividend rate per annum | 3.18% | ||
Series F | |||
Total Equity | |||
Number of shares outstanding (in shares) | shares | 2,099,046 | 2,099,046 | |
Stated capital | $ 48.1 | $ 52.5 | |
Liquidation preference per share (in dollars per share) | $ 25 | ||
Floating dividend rate per annum | 6.29% | ||
Adjustment to floating rate basis for payment of dividends | 2.16% | 2.16% | |
Series G | |||
Total Equity | |||
Number of shares outstanding (in shares) | shares | 7,719,843 | 7,719,843 | |
Stated capital | $ 182.1 | $ 193 | |
Liquidation preference per share (in dollars per share) | $ 25 | ||
Fixed dividend rate per annum | 2.96% | ||
Series H | |||
Total Equity | |||
Number of shares outstanding (in shares) | shares | 2,280,157 | 2,280,157 | |
Stated capital | $ 53.8 | $ 57 | |
Liquidation preference per share (in dollars per share) | $ 25 | ||
Floating dividend rate per annum | 6.69% | ||
Adjustment to floating rate basis for payment of dividends | 2.56% | 2.56% | |
Series I | |||
Total Equity | |||
Number of shares outstanding (in shares) | shares | 10,420,101 | 10,420,101 | |
Stated capital | $ 250.5 | $ 260.5 | |
Liquidation preference per share (in dollars per share) | $ 25 | ||
Fixed dividend rate per annum | 3.33% | ||
Series J | |||
Total Equity | |||
Number of shares outstanding (in shares) | shares | 1,579,899 | 1,579,899 | |
Stated capital | $ 38 | $ 39.5 | |
Liquidation preference per share (in dollars per share) | $ 25 | ||
Floating dividend rate per annum | 6.98% | ||
Adjustment to floating rate basis for payment of dividends | 2.85% | 2.85% | |
Series K | |||
Total Equity | |||
Number of shares outstanding (in shares) | shares | 9,500,000 | 9,500,000 | |
Stated capital | $ 231.7 | $ 237.5 | |
Liquidation preference per share (in dollars per share) | $ 25 | ||
Fixed dividend rate per annum | 4.67% | ||
Series L | |||
Total Equity | |||
Adjustment to floating rate basis for payment of dividends | 3.51% | 3.51% | |
Series M | |||
Total Equity | |||
Number of shares outstanding (in shares) | shares | 9,200,000 | 9,200,000 | |
Stated capital | $ 179.6 | $ 230 | |
Liquidation preference per share (in dollars per share) | $ 25 | ||
Fixed dividend rate per annum | 5% | ||
Series N | |||
Total Equity | |||
Adjustment to floating rate basis for payment of dividends | 3.98% | 3.98% |
Total Equity - Accumulated Othe
Total Equity - Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Pre-tax amount | ||
Foreign currency translation losses | $ (904.7) | $ (636.2) |
Share of accumulated other comprehensive loss of associates, excluding net gains (losses) on defined benefit plans | (221.6) | (79.8) |
Items that may be subsequently reclassified to net earnings | (1,126.3) | (716) |
Net gains (losses) on defined benefit plans | 43.8 | (104.9) |
Share of net gains (losses) on defined benefit plans of associates | 10.7 | (57.3) |
Other | 43.5 | 8.4 |
Items that will not be subsequently reclassified to net earnings | 98 | (153.8) |
Accumulated other comprehensive income (loss) attributable to shareholders of Fairfax | (1,028.3) | (869.8) |
Income tax (expense) recovery | ||
Foreign currency translation losses | 34.4 | 24.6 |
Share of accumulated other comprehensive income (loss) of associates, excluding net losses on defined benefit plans | 17.6 | 0.4 |
Items that may be subsequently reclassified to net earnings | 52 | 25 |
Net losses on defined benefit plans | (4.3) | 27.5 |
Share of net losses on defined benefit plans of associates | (4.7) | 5.5 |
Other | 5.7 | 10.1 |
Items that will not be subsequently reclassified to net earnings | (3.3) | 43.1 |
Accumulated other comprehensive income (loss) attributable to shareholders of Fairfax | 48.7 | 68.1 |
After-tax amount | ||
Foreign currency translation losses | (870.3) | (611.6) |
Share of accumulated other comprehensive income (loss) of associates, excluding net losses on defined benefit plans | (204) | (79.4) |
Items that may be subsequently reclassified to net earnings | (1,074.3) | (691) |
Net losses on defined benefit plans | 39.5 | (77.4) |
Share of net losses on defined benefit plans of associates | 6 | (51.8) |
Other | 49.2 | 18.5 |
Items that will not be subsequently reclassified to net earnings | 94.7 | (110.7) |
Accumulated other comprehensive income (loss) attributable to shareholders of Fairfax | $ (979.6) | $ (801.7) |
Total Equity - Income tax (expe
Total Equity - Income tax (expense) recovery included in other comprehensive income (loss) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income tax on items that may be subsequently reclassified to net earnings | ||
Net unrealized foreign currency translation losses on foreign subsidiaries | $ 10 | $ 5.2 |
Share of other comprehensive loss of associates, excluding net gains on defined benefit plans | 18.1 | 12.7 |
Income tax on items that may be reclassified to net earnings | 28.1 | 17.9 |
Income tax on items that will not be subsequently reclassified to net earnings | ||
Net gains on defined benefit plans | (32.2) | (27.4) |
Share of net gains on defined benefit plans of associates | (10.2) | (12.8) |
Income tax on items that will not be subsequently reclassified to net earnings | (42.4) | (40.2) |
Total income tax expense included in other comprehensive income (loss) | $ (14.3) | $ (22.3) |
Total Equity - Non-Controlling
Total Equity - Non-Controlling Interests (Details) - USD ($) $ in Millions | 12 Months Ended | |||||
Sep. 27, 2022 | Sep. 26, 2022 | Apr. 28, 2022 | Apr. 28, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Total equity | ||||||
Carrying value | $ 3,659.6 | $ 4,930.2 | ||||
Net earnings (loss) attributable to non-controlling interests | $ 139.6 | $ 265.5 | ||||
Allied World | ||||||
Total equity | ||||||
Proportion of ownership interest in subsidiary | 82.90% | 70.90% | ||||
Consideration paid | $ 733.5 | |||||
Loss recognized in retained earnings due to changes in capitalization of non-controlling interests | $ 228.1 | |||||
Fairfax India | ||||||
Total equity | ||||||
Voting percentage | 5.60% | 6.10% | ||||
Economic ownership percentage | 65.30% | 69.90% | ||||
Addition subordinate shares | 5,416,000 | |||||
Recipe | ||||||
Total equity | ||||||
Voting percentage | 39% | |||||
Economic ownership percentage | 61.50% | |||||
Allied World | ||||||
Total equity | ||||||
Dividends paid | $ 126.4 | $ 126.4 | ||||
Brit | Ki Insurance | ||||||
Total equity | ||||||
Capital contribution | $ 152 | |||||
Insurance and reinsurance companies | ||||||
Total equity | ||||||
Carrying value | 1,969.2 | $ 2,931.4 | ||||
Net earnings (loss) attributable to non-controlling interests | $ 2.8 | $ 221.2 | ||||
Insurance and reinsurance companies | Allied World | ||||||
Total equity | ||||||
Voting percentage | 17.10% | 29.10% | ||||
Carrying value | $ 761.1 | $ 1,419.6 | ||||
Net earnings (loss) attributable to non-controlling interests | $ (5.6) | $ 117.8 | ||||
Insurance and reinsurance companies | Brit | ||||||
Total equity | ||||||
Voting percentage | 13.80% | 13.80% | ||||
Carrying value | $ 658.8 | $ 559.3 | ||||
Net earnings (loss) attributable to non-controlling interests | $ (23.2) | $ 14 | ||||
Insurance and reinsurance companies | Odyssey Group | ||||||
Total equity | ||||||
Voting percentage | 9.99% | 9.99% | ||||
Carrying value | $ 499.2 | $ 550 | ||||
Net earnings (loss) attributable to non-controlling interests | 19.6 | |||||
Insurance and reinsurance companies | All other | ||||||
Total equity | ||||||
Carrying value | 50.1 | 402.5 | ||||
Net earnings (loss) attributable to non-controlling interests | 12 | 89.4 | ||||
Non-insurance companies | ||||||
Total equity | ||||||
Carrying value | 1,690.4 | 1,998.8 | ||||
Net earnings (loss) attributable to non-controlling interests | 136.8 | 44.3 | ||||
Non-insurance companies | Restaurants and retail | ||||||
Total equity | ||||||
Carrying value | 208.1 | 494.3 | ||||
Net earnings (loss) attributable to non-controlling interests | $ 32.7 | $ 11.8 | ||||
Non-insurance companies | Fairfax India | ||||||
Total equity | ||||||
Voting percentage | 5.60% | 6.10% | ||||
Carrying value | $ 1,080.2 | $ 1,133.1 | ||||
Net earnings (loss) attributable to non-controlling interests | $ 114.2 | $ 72.7 | ||||
Non-insurance companies | Thomas Cook India | ||||||
Total equity | ||||||
Voting percentage | 26.70% | 33.20% | ||||
Carrying value | $ 61.3 | $ 56.3 | ||||
Net earnings (loss) attributable to non-controlling interests | 1.1 | (16.8) | ||||
Non-insurance companies | All other | ||||||
Total equity | ||||||
Carrying value | 340.8 | 315.1 | ||||
Net earnings (loss) attributable to non-controlling interests | $ (11.2) | $ (23.4) |
Total Equity - Net Changes In C
Total Equity - Net Changes In Capitalization (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
As presented in other net changes in capitalization in the consolidated statement of changes in equity | $ (1,244.5) | $ 1,779.8 |
Common shareholders' equity | ||
Other | 116.4 | 1.9 |
As presented in other net changes in capitalization in the consolidated statement of changes in equity | (173.6) | 552.9 |
Non-controlling interests | ||
Other | (32.9) | 134.1 |
As presented in other net changes in capitalization in the consolidated statement of changes in equity | (1,070.9) | 1,226.9 |
RiverStone Barbados | Common shareholders' equity | ||
Purchase of certain securities held through AVLNs | 14.1 | 0.3 |
RiverStone Barbados | Non-controlling interests | ||
Purchase of certain securities held through AVLNs | (356.2) | (113.6) |
Anchorage | Common shareholders' equity | ||
Fairfax India's sale of an equity interest in Anchorage | 21.8 | |
Anchorage | Non-controlling interests | ||
Fairfax India's sale of an equity interest in Anchorage | 107.4 | |
Recipe | Common shareholders' equity | ||
Privatization | (66.1) | |
Recipe | Non-controlling interests | ||
Privatization | (276.2) | |
Allied World | Common shareholders' equity | ||
Acquisition of non-controlling interests | (228.1) | |
Allied World | Non-controlling interests | ||
Acquisition of non-controlling interests | (466.9) | |
Ki Insurance | Non-controlling interests | ||
Third party's net investment | 152 | 124 |
Fairfax India | Common shareholders' equity | ||
Share repurchases | (9.9) | (12.5) |
Fairfax India | Non-controlling interests | ||
Share repurchases | $ (90.7) | (114.3) |
Odyssey Group | Common shareholders' equity | ||
Sale of non-controlling interests | 429.1 | |
Odyssey Group | Non-controlling interests | ||
Sale of non-controlling interests | 550 | |
Brit | Common shareholders' equity | ||
Sale of non-controlling interests | 115.4 | |
Brit | Non-controlling interests | ||
Sale of non-controlling interests | 296.7 | |
Farmers Edge and Boat Rocker | Common shareholders' equity | ||
Initial public offerings and related capital transactions | (3.1) | |
Farmers Edge and Boat Rocker | Non-controlling interests | ||
Initial public offerings and related capital transactions | $ 242.6 |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Earnings per Share | ||
Net earnings attributable to shareholders of Fairfax | $ 1,147.2 | $ 3,401.1 |
Preferred share dividends | (45.2) | (44.5) |
Net earnings attributable to common shareholders - basic and diluted | $ 1,102 | $ 3,356.6 |
Weighted average common shares outstanding - basic (in shares) | 23,637,824 | 25,953,114 |
Share-based payment awards (in shares) | 1,702,599 | 1,503,931 |
Weighted average common shares outstanding - diluted (in shares) | 25,340,423 | 27,457,045 |
Net earnings per common share - basic (in dollars per share) | $ 46.62 | $ 129.33 |
Net earnings per common share - diluted (in dollars per share) | $ 43.49 | $ 122.25 |
Income Taxes - Provision for in
Income Taxes - Provision for income taxes (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Current income tax: | ||
Current year expense | $ 616.8 | $ 401.6 |
Adjustments to prior years' income taxes | (10) | (14.6) |
Current income tax | 606.8 | 387 |
Deferred income tax: | ||
Origination and reversal of temporary differences | (197.1) | 313.5 |
Adjustments to prior years' deferred income taxes | 11.7 | 18.9 |
Other | 3.8 | 6.6 |
Deferred income tax | (181.6) | 339 |
Provision for income taxes | $ 425.2 | $ 726 |
Income Taxes - Earnings (loss)
Income Taxes - Earnings (loss) before income taxes (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segmented Information | ||
Earnings (loss) before income taxes | $ 1,712 | $ 4,392.6 |
Provision for (recovery of) income taxes | 425.2 | 726 |
Net earnings (loss) | 1,286.8 | 3,666.6 |
Gain on sale and consolidation of insurance subsidiaries | 1,219.7 | 264 |
Canada | ||
Segmented Information | ||
Earnings (loss) before income taxes | 399.2 | 858.8 |
Provision for (recovery of) income taxes | 114.7 | 191.6 |
Net earnings (loss) | 284.5 | 667.2 |
U.S. | ||
Segmented Information | ||
Earnings (loss) before income taxes | 1,330.7 | 974.5 |
Provision for (recovery of) income taxes | 238.3 | 238.6 |
Net earnings (loss) | 1,092.4 | 735.9 |
U.S. | Property and Casualty Insurance and Reinsurance | ||
Segmented Information | ||
Gain on sale and consolidation of insurance subsidiaries | 1,213.2 | |
U.K. | ||
Segmented Information | ||
Earnings (loss) before income taxes | (112.2) | 157.3 |
Provision for (recovery of) income taxes | (12.9) | 18.7 |
Net earnings (loss) | (99.3) | 138.6 |
Other | ||
Segmented Information | ||
Earnings (loss) before income taxes | 94.3 | 2,402 |
Provision for (recovery of) income taxes | 85.1 | 277.1 |
Net earnings (loss) | $ 9.2 | 2,124.9 |
Asia | Go Digit Insurance Limited | ||
Segmented Information | ||
Unrealized gain on investment in associate | $ 1,490.3 |
Income Taxes - Income tax recon
Income Taxes - Income tax reconciliation (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Taxes | ||
Canadian statutory income tax rate | 26.50% | 26.50% |
Provision for income taxes at the Canadian statutory income tax rate | $ 453.7 | $ 1,164 |
Non-taxable investment income | (25.6) | (149.4) |
Tax rate differential on income and losses outside Canada | (50.9) | (399.1) |
Change in unrecorded tax benefit of losses and temporary differences | 0.8 | 67.2 |
Change in tax rate for deferred income taxes | 6.6 | 0.3 |
Recovery relating to prior years | 1.7 | 4.3 |
Foreign exchange effect | (17.1) | (23) |
Other including permanent differences | 56 | 61.7 |
Provision for income taxes | $ 425.2 | $ 726 |
Income Taxes - Income taxes ref
Income Taxes - Income taxes refundable and payable (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Income Taxes | |||
Income taxes refundable | $ 67.1 | $ 58.3 | |
Income taxes payable | (361) | (175) | |
Net income taxes payable | $ (293.9) | $ (116.7) | $ 24.2 |
Income Taxes - Changes in net i
Income Taxes - Changes in net income taxes (payable) refundable (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in net income taxes (payable) refundable | ||
Balance - January 1 | $ (116.7) | $ 24.2 |
Amounts recorded in the consolidated statements of earnings | (606.8) | (387) |
Payments made during the year | 416.4 | 288.7 |
Acquisitions of subsidiaries | (54.5) | |
Foreign exchange effect and other | 13.2 | 11.9 |
Balance - December 31 | $ (293.9) | $ (116.7) |
Income Taxes - Changes in net d
Income Taxes - Changes in net deferred income tax asset (liability) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of changes in net deferred income tax asset (liability) | ||
Deferred tax asset, beginning balance | $ (76.4) | $ 357.5 |
Amounts recorded in the consolidated statement of earnings | 181.6 | (339) |
Amounts recorded in total equity | (14.3) | (19.2) |
Acquisitions of subsidiaries | (62.6) | (74.1) |
Deconsolidation of non-insurance subsidiaries | 6.4 | 2.6 |
Foreign exchange effect and other | (39.3) | (4.2) |
Deferred tax asset, ending balance | (4.6) | (76.4) |
Operating and capital losses | ||
Reconciliation of changes in net deferred income tax asset (liability) | ||
Deferred tax asset, beginning balance | 230 | 236.3 |
Amounts recorded in the consolidated statement of earnings | (7.1) | (3.5) |
Amounts recorded in total equity | 8 | 17.5 |
Acquisitions of subsidiaries | 3.3 | (4.2) |
Deconsolidation of non-insurance subsidiaries | (0.6) | (7.5) |
Foreign exchange effect and other | (6.8) | (8.6) |
Deferred tax asset, ending balance | 226.8 | 230 |
Provision for losses and loss adjustment expenses | ||
Reconciliation of changes in net deferred income tax asset (liability) | ||
Deferred tax asset, beginning balance | 204.2 | 168.8 |
Amounts recorded in the consolidated statement of earnings | 53.4 | 35.6 |
Foreign exchange effect and other | (2.9) | (0.2) |
Deferred tax asset, ending balance | 254.7 | 204.2 |
Provision for unearned premiums | ||
Reconciliation of changes in net deferred income tax asset (liability) | ||
Deferred tax asset, beginning balance | 187.7 | 141.7 |
Amounts recorded in the consolidated statement of earnings | 27 | 46 |
Foreign exchange effect and other | 0.2 | |
Deferred tax asset, ending balance | 214.9 | 187.7 |
Deferred premium acquisition costs | ||
Reconciliation of changes in net deferred income tax asset (liability) | ||
Deferred tax asset, beginning balance | (147.8) | (116.1) |
Amounts recorded in the consolidated statement of earnings | (22.7) | (39.4) |
Acquisitions of subsidiaries | 7.9 | |
Foreign exchange effect and other | (0.8) | (0.2) |
Deferred tax asset, ending balance | (171.3) | (147.8) |
Intangible assets | ||
Reconciliation of changes in net deferred income tax asset (liability) | ||
Deferred tax asset, beginning balance | (413.1) | (389.5) |
Amounts recorded in the consolidated statement of earnings | 30.9 | (19.5) |
Acquisitions of subsidiaries | (1.9) | (10.3) |
Deconsolidation of non-insurance subsidiaries | 7 | 7.8 |
Foreign exchange effect and other | 1 | (1.6) |
Deferred tax asset, ending balance | (376.1) | (413.1) |
Investments | ||
Reconciliation of changes in net deferred income tax asset (liability) | ||
Deferred tax asset, beginning balance | (414.5) | 23.9 |
Amounts recorded in the consolidated statement of earnings | 219.4 | (339.2) |
Amounts recorded in total equity | 20.1 | 0.8 |
Acquisitions of subsidiaries | (11.4) | (98.9) |
Foreign exchange effect and other | 15.5 | (1.1) |
Deferred tax asset, ending balance | (170.9) | (414.5) |
Tax credits | ||
Reconciliation of changes in net deferred income tax asset (liability) | ||
Deferred tax asset, beginning balance | 213.6 | 174.8 |
Amounts recorded in the consolidated statement of earnings | (137.1) | 32.3 |
Foreign exchange effect and other | (1.1) | 6.5 |
Deferred tax asset, ending balance | 75.4 | 213.6 |
Other | ||
Reconciliation of changes in net deferred income tax asset (liability) | ||
Deferred tax asset, beginning balance | 63.5 | 117.6 |
Amounts recorded in the consolidated statement of earnings | 17.8 | (51.3) |
Amounts recorded in total equity | (42.4) | (37.5) |
Acquisitions of subsidiaries | (52.6) | 31.4 |
Deconsolidation of non-insurance subsidiaries | 2.3 | |
Foreign exchange effect and other | (44.4) | 1 |
Deferred tax asset, ending balance | $ (58.1) | $ 63.5 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Taxes | ||
Unremitted earnings of subsidiaries | $ 9,900 | $ 7,600 |
Canada | ||
Income Taxes | ||
Deferred income tax assets not recorded | 1,728 | 2,089.3 |
Europe | ||
Income Taxes | ||
Deferred income tax assets not recorded | 552.1 | 488.8 |
United States | ||
Income Taxes | ||
Deferred income tax assets not recorded | 207.6 | 109.4 |
Allied World | ||
Income Taxes | ||
Deferred income tax assets not recorded | $ 295.6 | 251.4 |
Operating loss carryforward, expiration period | 7 years | |
Deferred Tax Assets, Operating and Capital Losses | ||
Income Taxes | ||
Deferred income tax assets not recorded | $ 827.7 | $ 875.9 |
Statutory Requirements (Details
Statutory Requirements (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Statutory Requirements | ||
Common share dividends | $ 513.1 | $ 427.5 |
Dividend capacity available | 2,652.9 | |
Insurance and reinsurance companies | ||
Statutory Requirements | ||
Common share dividends | 380.9 | $ 429.5 |
Allied World | ||
Statutory Requirements | ||
Dividend capacity available | 1,167.5 | |
Odyssey Group | ||
Statutory Requirements | ||
Dividend capacity available | 767.2 | |
Northbridge | ||
Statutory Requirements | ||
Dividend capacity available | 422.2 | |
Crum & Forster | ||
Statutory Requirements | ||
Dividend capacity available | 204.6 | |
Crum & Forster | Insurance and reinsurance companies | ||
Statutory Requirements | ||
Special dividend paid | 940 | |
Zenith National | ||
Statutory Requirements | ||
Dividend capacity available | $ 91.4 |
Contingencies and Commitments (
Contingencies and Commitments (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Contingencies and Commitments | |
Capital commitments | $ 1,422.8 |
Guaranteed value of securities to CVC and certain affiliates | 486.8 |
Lloyd's participants | Cash and cash equivalents | |
Contingencies and Commitments | |
Financial assets pledged as collateral | 233.6 |
Lloyd's participants | Financial assets at fair value | Securities | |
Contingencies and Commitments | |
Financial assets pledged as collateral | $ 1,670.7 |
Pensions and Post Retirement _3
Pensions and Post Retirement Benefits - Funded status of defined benefit pension and post retirement plans (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Weighted average assumptions used to determine benefit obligations: | ||
Pension deficits | $ 145.7 | $ 253.9 |
Pension surpluses | 144.5 | 113.8 |
Defined benefit pension plans | ||
Pensions and Post Retirement Benefits | ||
Benefit obligation | (715.5) | (1,070.9) |
Fair value of plan assets | 784.7 | 1,014.7 |
Funded status of plans - surplus (deficit) | 69.2 | (56.2) |
Net accrued asset (liability) | $ 65.6 | $ (56.2) |
Weighted average assumptions used to determine benefit obligations: | ||
Discount rate | 4.90% | 2.60% |
Rate of compensation increase | 2.50% | 2.20% |
Pension deficits | $ 78.9 | $ 170 |
Pension surpluses | 144.5 | 113.8 |
Defined benefit pension plans | Impact of asset ceiling | ||
Pensions and Post Retirement Benefits | ||
Net accrued asset (liability) | (3.6) | |
Post retirement benefit plans | ||
Pensions and Post Retirement Benefits | ||
Benefit obligation | (66.8) | (83.9) |
Funded status of plans - surplus (deficit) | (66.8) | (83.9) |
Net accrued asset (liability) | $ (66.8) | $ (83.9) |
Weighted average assumptions used to determine benefit obligations: | ||
Discount rate | 5.20% | 3.10% |
Rate of compensation increase | 3.80% | 3.70% |
Health care cost trend | 3.40% | 3.60% |
Pensions and Post Retirement _4
Pensions and Post Retirement Benefits - Pension and post retirement benefit expenses recognized (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Pensions and Post Retirement Benefits | ||
Employee benefits | $ 507.2 | $ 462.2 |
Pension and post retirement benefit expenses | ||
Pensions and Post Retirement Benefits | ||
Defined benefit pension plan expense | 20.3 | 25.8 |
Defined contribution pension plan expense | 62.2 | 57.8 |
Defined benefit post retirement plan expense | 5 | 2 |
Employee benefits | $ 87.5 | $ 85.6 |
Pensions and Post Retirement _5
Pensions and Post Retirement Benefits - Pre-tax actuarial net gains (losses) recognized (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Pensions and Post Retirement Benefits | ||
Defined benefit post retirement plans - actuarial net gains on benefit obligations | $ 153.9 | $ 115.6 |
Defined benefit pension plans | ||
Pensions and Post Retirement Benefits | ||
Actuarial net gains (losses) on plan assets and change in asset ceiling | (157.3) | 78.6 |
Actuarial net gains on benefit obligations | 295 | 33.8 |
Defined benefit post retirement plans - actuarial net gains on benefit obligations | 137.7 | 112.4 |
Post retirement benefit plans | ||
Pensions and Post Retirement Benefits | ||
Actuarial net gains on benefit obligations | $ 16.2 | $ 3.2 |
Leases - Changes in right-of-us
Leases - Changes in right-of-use assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in right-of-use assets | ||
Balance - January 1 | $ 759.8 | $ 1,008 |
Additions | 161.9 | 136 |
Disposals | (15.9) | (61) |
Depreciation | (157.1) | (181.3) |
Acquisitions of subsidiaries | 56.7 | 15 |
Deconsolidation of subsidiaries | (4) | (148.1) |
Foreign exchange effect and other | (32.9) | (8.8) |
Balance - December 31 | 768.5 | 759.8 |
Insurance and reinsurance companies | ||
Changes in right-of-use assets | ||
Balance - January 1 | 328.8 | 396.1 |
Additions | 63.7 | 44 |
Disposals | (7.5) | (41.2) |
Depreciation | (67.2) | (68.3) |
Acquisitions of subsidiaries | 0.9 | |
Deconsolidation of subsidiaries | (1.1) | (1.4) |
Foreign exchange effect and other | (9.5) | (1.3) |
Balance - December 31 | 307.2 | 328.8 |
Non-insurance companies | ||
Changes in right-of-use assets | ||
Balance - January 1 | 431 | 611.9 |
Additions | 98.2 | 92 |
Disposals | (8.4) | (19.8) |
Depreciation | (89.9) | (113) |
Acquisitions of subsidiaries | 56.7 | 14.1 |
Deconsolidation of subsidiaries | (2.9) | (146.7) |
Foreign exchange effect and other | (23.4) | (7.5) |
Balance - December 31 | $ 461.3 | $ 431 |
Leases - Maturity of lease liab
Leases - Maturity of lease liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Leases | ||
Lease liabilities, undiscounted | $ 1,369.2 | $ 1,356.3 |
Lease liabilities, discounted | $ 1,094 | $ 1,140.7 |
Weighted average incremental borrowing rate | 4.40% | 4.30% |
One year or less | ||
Leases | ||
Lease liabilities, undiscounted | $ 228.5 | $ 251 |
One to two years | ||
Leases | ||
Lease liabilities, undiscounted | 208.9 | 215.7 |
Two to three years | ||
Leases | ||
Lease liabilities, undiscounted | 188 | 188.4 |
Three to four years | ||
Leases | ||
Lease liabilities, undiscounted | 163.9 | 167.4 |
Four to five years | ||
Leases | ||
Lease liabilities, undiscounted | 132 | 141.4 |
More than five years | ||
Leases | ||
Lease liabilities, undiscounted | 447.9 | 392.4 |
Insurance and reinsurance companies | ||
Leases | ||
Lease liabilities, undiscounted | 418.6 | 443.5 |
Lease liabilities, discounted | $ 364.1 | $ 384.2 |
Weighted average incremental borrowing rate | 3.80% | 3.80% |
Insurance and reinsurance companies | One year or less | ||
Leases | ||
Lease liabilities, undiscounted | $ 72.7 | $ 77.4 |
Insurance and reinsurance companies | One to two years | ||
Leases | ||
Lease liabilities, undiscounted | 66.5 | 67.6 |
Insurance and reinsurance companies | Two to three years | ||
Leases | ||
Lease liabilities, undiscounted | 60.3 | 58.6 |
Insurance and reinsurance companies | Three to four years | ||
Leases | ||
Lease liabilities, undiscounted | 55.9 | 52 |
Insurance and reinsurance companies | Four to five years | ||
Leases | ||
Lease liabilities, undiscounted | 45.5 | 45.1 |
Insurance and reinsurance companies | More than five years | ||
Leases | ||
Lease liabilities, undiscounted | 117.7 | 142.8 |
Non-insurance companies | ||
Leases | ||
Lease liabilities, undiscounted | 950.6 | 912.8 |
Lease liabilities, discounted | $ 729.9 | $ 756.5 |
Weighted average incremental borrowing rate | 4.70% | 4.50% |
Non-insurance companies | One year or less | ||
Leases | ||
Lease liabilities, undiscounted | $ 155.8 | $ 173.6 |
Non-insurance companies | One to two years | ||
Leases | ||
Lease liabilities, undiscounted | 142.4 | 148.1 |
Non-insurance companies | Two to three years | ||
Leases | ||
Lease liabilities, undiscounted | 127.7 | 129.8 |
Non-insurance companies | Three to four years | ||
Leases | ||
Lease liabilities, undiscounted | 108 | 115.4 |
Non-insurance companies | Four to five years | ||
Leases | ||
Lease liabilities, undiscounted | 86.5 | 96.3 |
Non-insurance companies | More than five years | ||
Leases | ||
Lease liabilities, undiscounted | $ 330.2 | $ 249.6 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases | ||
Interest expense on lease liabilities | $ 46.9 | $ 57.9 |
Short-term, low value and other lease costs | 51 | 19.1 |
Non-insurance companies | ||
Leases | ||
Interest expense on lease liabilities | 46.9 | 57.9 |
Lease concessions, COVID related | $ 1.7 | $ 28.9 |
Leases - Maturity of finance le
Leases - Maturity of finance lease receivables (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Leases | ||
Finance lease receivables, undiscounted | $ 264.8 | $ 307.7 |
Unearned finance income | 38 | 41.6 |
Finance lease receivables | 226.8 | 266.1 |
Insurance and reinsurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 9.8 | 10.9 |
Unearned finance income | 1 | 1.5 |
Finance lease receivables | 8.8 | 9.4 |
Non-insurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 255 | 296.8 |
Unearned finance income | 37 | 40.1 |
Finance lease receivables | 218 | 256.7 |
One year or less | ||
Leases | ||
Finance lease receivables, undiscounted | 58.2 | 64.5 |
One year or less | Insurance and reinsurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 2.8 | 2.5 |
One year or less | Non-insurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 55.4 | 62 |
One to two years | ||
Leases | ||
Finance lease receivables, undiscounted | 50.3 | 55.3 |
One to two years | Insurance and reinsurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 1.8 | 2.3 |
One to two years | Non-insurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 48.5 | 53 |
Two to three years | ||
Leases | ||
Finance lease receivables, undiscounted | 44.1 | 46 |
Two to three years | Insurance and reinsurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 1.4 | 1.3 |
Two to three years | Non-insurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 42.7 | 44.7 |
Three to four years | ||
Leases | ||
Finance lease receivables, undiscounted | 37.8 | 40.3 |
Three to four years | Insurance and reinsurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 1.1 | 1 |
Three to four years | Non-insurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 36.7 | 39.3 |
Four to five years | ||
Leases | ||
Finance lease receivables, undiscounted | 28.5 | 34.3 |
Four to five years | Insurance and reinsurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 0.7 | 1 |
Four to five years | Non-insurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 27.8 | 33.3 |
More than five years | ||
Leases | ||
Finance lease receivables, undiscounted | 45.9 | 67.3 |
More than five years | Insurance and reinsurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | 2 | 2.8 |
More than five years | Non-insurance companies | ||
Leases | ||
Finance lease receivables, undiscounted | $ 43.9 | $ 64.5 |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Sale of Ambridge Group by Brit (Details) - Sale of subsidiary - Brit - Ambridge Group - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Jan. 07, 2023 | |
Acquisitions and Divestitures | ||
Consideration to be received | $ 400 | |
Cash consideration | 275 | |
Promissory note receivable | 125 | |
Contingent consideration receivable based on 2023 performance targets | $ 100 | |
Deconsolidate assets, carrying values | $ 284 | |
Deconsolidate liabilities, carrying values | 160 | |
Pre-tax gain on sale | $ 275 |
Acquisitions and Divestitures_2
Acquisitions and Divestitures - Sale of Pet Insurance Operations and Investment in JAB Consumer Fund (Details) - JAB Consumer Fund $ in Millions | Oct. 31, 2022 USD ($) |
Acquisitions and Divestitures | |
Commitment for future investment | $ 200 |
Crum & Forster Pet Insurance Group and Pethealth | |
Acquisitions and Divestitures | |
Aggregate sale price | 1,400 |
Cash proceeds received from sale of business interests | 1,150 |
Debentures received as consideration in sale of business interests | 250 |
Pre-tax gain on sale | 1,213.2 |
After tax gain on sale | 933.9 |
Deconsolidate assets, carrying values | 149.1 |
Deconsolidate liabilities, carrying values | $ 32 |
Acquisitions and Divestitures_3
Acquisitions and Divestitures - Additional investment in Recipe Unlimited Corporation (Details) - Recipe $ / shares in Units, $ in Millions, $ in Millions | 12 Months Ended | ||||
Dec. 28, 2022 USD ($) | Dec. 28, 2022 CAD ($) | Oct. 28, 2022 USD ($) shares | Dec. 31, 2021 | Oct. 28, 2022 CAD ($) $ / shares shares | |
Acquisitions and Divestitures | |||||
Number of MVS shares retained by Cara Holdings Limited | shares | 9,398,729 | 9,398,729 | |||
Cash purchase price per share | $ / shares | $ 20.73 | ||||
Purchase consideration | $ 342.3 | $ 465.9 | |||
Cash transferred | 242.5 | 330 | |||
Liabilities assumed in business acquisition | 99.8 | $ 135.9 | |||
Loss on net changes in net capitalization related to business acquisition | 66.1 | ||||
Decrease in non-controlling interests due to changes in net capitalization | $ 276.2 | ||||
Equity ownership percentage | 75.70% | 38.50% | |||
Equity ownership percentage including investment in AVLNs | 84% | ||||
Cash consideration received upon redemption of certain equity held by the company in connection with the closing of the transaction | $ 73.6 | $ 100 |
Acquisitions and Divestitures_4
Acquisitions and Divestitures - Consolidation of Grivalia Hospitality S.A. (Details) - Grivalia Hospitality € in Millions, $ in Millions | Jul. 05, 2022 USD ($) | Jul. 05, 2022 EUR (€) | Jul. 04, 2022 |
Acquisitions and Divestitures | |||
Percentage of common shares acquired | 78.40% | 78.40% | 33.50% |
Cash transferred | $ 194.6 | € 190 |
Acquisitions and Divestitures_5
Acquisitions and Divestitures - Sale of non-controlling interest in Odyssey Group (Details) - Odyssey Group $ in Millions | Dec. 15, 2021 USD ($) |
Acquisitions and Divestitures | |
Proportion of non-controlling interests issued | 9.99% |
Dividends received by Fairfax from subsidiary related to sale of interests in subsidiary | $ 900 |
Gain on call option received recognized in equity | $ 429.1 |
Acquisitions and Divestitures_6
Acquisitions and Divestitures - Sale of non-controlling interest in Brit (Details) - Brit $ in Millions | Aug. 27, 2021 USD ($) |
Acquisitions and Divestitures | |
Proportion of non-controlling interests issued | 13.90% |
Dividends received by Fairfax from subsidiary related to sale of interests in subsidiary | $ 375 |
Gain on call option received recognized in equity | $ 115.4 |
Acquisitions and Divestitures_7
Acquisitions and Divestitures - Sale of RiverStone Barbados (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Jul. 05, 2022 | Aug. 23, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Feb. 08, 2021 | |
Acquisitions and Divestitures | |||||
Cash proceeds from sales of interests in associates | $ 192.9 | $ 809.2 | |||
Derivative assets | 467.8 | 581.8 | |||
Guaranteed value of securities to CVC and certain affiliates | 486.8 | ||||
Asset Value Loan Notes | |||||
Acquisitions and Divestitures | |||||
Derivative assets | 30.7 | 103.8 | |||
Guaranteed value of securities to CVC and certain affiliates | $ 543.4 | $ 486.8 | 1,300 | ||
RiverStone Barbados | Asset Value Loan Notes | |||||
Acquisitions and Divestitures | |||||
Guaranteed value of securities | 1,100 | $ 1,300 | |||
Derivative assets | 103.8 | ||||
Net gain on sale of investments | 103.8 | ||||
Sale of securities assured value | 120.8 | ||||
Guaranteed value of securities to CVC and certain affiliates | $ 543.4 | ||||
RiverStone Barbados | |||||
Acquisitions and Divestitures | |||||
Proportion of ownership interest in joint venture disposed of | 60% | ||||
Aggregate sale price | $ 695.7 | ||||
Cash proceeds from sales of interests in associates | 462 | ||||
Fair value of non-voting shares received as consideration in sale of business interests | 200 | ||||
Notional amount | $ 200 | ||||
Net loss on investments from sale of business interests | 2.1 | ||||
Contingent consideration receivable recognized | $ 235.7 | ||||
OMERS | RiverStone Barbados | |||||
Acquisitions and Divestitures | |||||
Proportion of ownership interest in joint venture disposed of | 40% |
Acquisitions and Divestitures_8
Acquisitions and Divestitures - Sale of Toys "R" Us Canada (Details) - Aug. 19, 2021 - Toys "R" Us Canada $ in Millions, $ in Millions | USD ($) | CAD ($) |
Acquisitions and Divestitures | ||
Cash proceeds received from sale of business interests | $ 90.3 | $ 115.7 |
Gain on sale of business interests | $ 85.7 |
Acquisitions and Divestitures_9
Acquisitions and Divestitures - Privatization of Mosaic Capital (Details) - Aug. 05, 2021 - Mosaic Capital $ in Millions, $ in Millions | USD ($) | CAD ($) |
Acquisitions and Divestitures | ||
Exchange amount of cash | $ 10.7 | $ 13.3 |
Debentures, consideration received under privatization | $ 130.8 | 163.3 |
Term of debentures | 25 years | |
Investments in privatized company | $ 4 | $ 5 |
Equity ownership percentage | 20% |
Acquisitions and Divestiture_10
Acquisitions and Divestitures - Acquisition of Eurolife FFH Insurance Group Holdings S.A. (Details) € in Millions, $ in Millions | Jul. 14, 2021 USD ($) | Jul. 13, 2021 | Jul. 14, 2021 EUR (€) |
Eurolife | |||
Acquisitions and Divestitures | |||
Proportion of ownership interest in joint venture | 80% | 50% | |
Amount of exercise of call option | $ 127.3 | ||
Cash transferred | 142.7 | € 120.7 | |
Fair value of investment in subsidiary | 450 | ||
Net gain on sale and consolidation of insurance subsidiaries | 130.5 | ||
Assets: | |||
Insurance contract receivables | 11.6 | ||
Portfolio investments | 3,653.9 | ||
Recoverable from reinsurers | 18.6 | ||
Deferred income tax assets | 32.6 | ||
Intangible assets | 45.5 | ||
Other assets | 616.3 | ||
Total assets acquired | 4,378.5 | ||
Liabilities: | |||
Accounts payable and accrued liabilities | 273.2 | ||
Insurance contract payables | 529 | ||
Insurance contract liabilities | 2,751.4 | ||
Deferred income tax liabilities | 100.9 | ||
Total liabilities assumed | 3,654.5 | ||
Purchase consideration | 720 | ||
Excess of fair value of net assets acquired over purchase consideration | 4 | ||
Total | $ 4,378.5 | ||
Percentage of ownership interests acquired, including non-controlling interests | 100% | 100% | |
Subsidiary cash and cash equivalents | $ 1,433.3 | ||
Redemption liability | 124.9 | ||
Eurolife | Distribution agreement | |||
Assets: | |||
Intangible assets | 29 | ||
Eurolife | Unit-linked life insurance contracts | |||
Assets: | |||
Other assets | $ 532.1 | ||
Eurobank | |||
Acquisitions and Divestitures | |||
Proportion of ownership interests held by non-controlling interests | 20% | ||
Eurobank | Eurolife | |||
Acquisitions and Divestitures | |||
Proportion of ownership interests held by non-controlling interests | 20% |
Acquisitions and Divestiture_11
Acquisitions and Divestitures - Additional investment in Singapore Reinsurance Corporation Limited (Details) - Singapore Re $ in Millions, $ in Millions | Aug. 03, 2021 | Jun. 17, 2021 USD ($) | Jun. 16, 2021 | Jun. 17, 2021 SGD ($) |
Acquisitions and Divestitures | ||||
Equity ownership percentage | 100% | 94% | 28.20% | |
Purchase consideration | $ 102.9 | $ 138 |
Acquisitions and Divestiture_12
Acquisitions and Divestitures - Fairfax India's sale of Privi Speciality Chemicals Limited (Details) - Apr. 29, 2021 - Privi Speciality Chemicals Limited $ in Millions, ₨ in Billions | USD ($) | INR (₨) |
Acquisitions and Divestitures | ||
Percentage of interest sold | 48.80% | |
Purchase consideration | $ 164.8 | ₨ 12.2 |
Net gain on sale and consolidation of insurance subsidiaries | $ 94.9 |
Financial Risk Management - Und
Financial Risk Management - Underwriting Risk - Gross Premiums Written (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Financial Risk Management | |||
Recoverable from reinsurers | $ 13,115.8 | $ 12,090.5 | $ 10,533.2 |
Gross premiums written | $ 27,912.6 | 23,910.2 | |
Asbestos and environmental claims, maximum settlement period (in years) | 40 years | ||
Normalized net earnings, percent return on common shareholders' equity adjusted to pre-tax basis | 15% | ||
Eurolife's life insurance operations | |||
Financial Risk Management | |||
Gross premiums written | $ 350.9 | 114.2 | |
Total revenues, excluding Life | |||
Financial Risk Management | |||
Gross premiums written | 27,561.7 | 23,796 | |
Total revenues, excluding Life | Canada | |||
Financial Risk Management | |||
Gross premiums written | 2,845.4 | 2,611.4 | |
Total revenues, excluding Life | United States | |||
Financial Risk Management | |||
Gross premiums written | 17,842.6 | 15,032 | |
Total revenues, excluding Life | Asia | |||
Financial Risk Management | |||
Gross premiums written | 1,934.3 | 1,676.4 | |
Total revenues, excluding Life | International | |||
Financial Risk Management | |||
Gross premiums written | 4,939.4 | 4,476.2 | |
Property | |||
Financial Risk Management | |||
Gross premiums written | 9,712.5 | 8,132.6 | |
Property | Canada | |||
Financial Risk Management | |||
Gross premiums written | 1,343.7 | 1,229.1 | |
Property | United States | |||
Financial Risk Management | |||
Gross premiums written | 4,966.1 | 3,912.4 | |
Property | Asia | |||
Financial Risk Management | |||
Gross premiums written | 984.5 | 849.2 | |
Property | International | |||
Financial Risk Management | |||
Gross premiums written | 2,418.2 | 2,141.9 | |
Casualty | |||
Financial Risk Management | |||
Gross premiums written | 15,677.9 | 13,732.3 | |
Casualty | Canada | |||
Financial Risk Management | |||
Gross premiums written | 1,243.4 | 1,159 | |
Casualty | United States | |||
Financial Risk Management | |||
Gross premiums written | 12,004.9 | 10,364 | |
Casualty | Asia | |||
Financial Risk Management | |||
Gross premiums written | 606.6 | 549.8 | |
Casualty | International | |||
Financial Risk Management | |||
Gross premiums written | 1,823 | 1,659.5 | |
Specialty | |||
Financial Risk Management | |||
Gross premiums written | 2,171.3 | 1,931.1 | |
Specialty | Canada | |||
Financial Risk Management | |||
Gross premiums written | 258.3 | 223.3 | |
Specialty | United States | |||
Financial Risk Management | |||
Gross premiums written | 871.6 | 755.6 | |
Specialty | Asia | |||
Financial Risk Management | |||
Gross premiums written | 343.2 | 277.4 | |
Specialty | International | |||
Financial Risk Management | |||
Gross premiums written | 698.2 | 674.8 | |
Insurance | |||
Financial Risk Management | |||
Gross premiums written | 20,165.4 | 18,004.4 | |
Insurance | Canada | |||
Financial Risk Management | |||
Gross premiums written | 2,686.2 | 2,475.1 | |
Insurance | United States | |||
Financial Risk Management | |||
Gross premiums written | 13,080.8 | 11,448.6 | |
Insurance | Asia | |||
Financial Risk Management | |||
Gross premiums written | 789.8 | 739.7 | |
Insurance | International | |||
Financial Risk Management | |||
Gross premiums written | 3,608.6 | 3,341 | |
Reinsurance | |||
Financial Risk Management | |||
Gross premiums written | 7,396.3 | 5,791.6 | |
Reinsurance | Canada | |||
Financial Risk Management | |||
Gross premiums written | 159.2 | 136.3 | |
Reinsurance | United States | |||
Financial Risk Management | |||
Gross premiums written | 4,761.8 | 3,583.4 | |
Reinsurance | Asia | |||
Financial Risk Management | |||
Gross premiums written | 1,144.5 | 936.7 | |
Reinsurance | International | |||
Financial Risk Management | |||
Gross premiums written | 1,330.8 | 1,135.2 | |
Ceded reinsurance contracts | Property | |||
Financial Risk Management | |||
Recoverable from reinsurers | 1,938.5 | 1,717.4 | |
Ceded reinsurance contracts | Casualty | |||
Financial Risk Management | |||
Recoverable from reinsurers | 3,256.6 | 3,487.7 | |
Ceded reinsurance contracts | Specialty | |||
Financial Risk Management | |||
Recoverable from reinsurers | $ 439.2 | $ 423.4 |
Financial Risk Management - Cre
Financial Risk Management - Credit Risk - Gross credit risk exposure (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Financial Risk Management | ||
Assets associated with unit-linked insurance products | $ 676.5 | $ 637.1 |
Income taxes refundable | 67.1 | 58.3 |
Credit risk | ||
Financial Risk Management | ||
Maximum exposure to credit risk | 62,691.2 | 58,343 |
Assets associated with unit-linked insurance products | 676.5 | 637.1 |
Income taxes refundable | 67.1 | 58.3 |
Credit risk | Cash and short term investments | ||
Financial Risk Management | ||
Maximum exposure to credit risk | 10,386 | 22,795.5 |
Credit risk | U.S. sovereign government | ||
Financial Risk Management | ||
Maximum exposure to credit risk | $ 14,378.8 | $ 3,957.9 |
Risk exposure percentage | 30.30% | 9.50% |
Credit risk | Other sovereign government rated AA/Aa or higher | ||
Financial Risk Management | ||
Maximum exposure to credit risk | $ 2,413.5 | $ 1,074.7 |
Credit risk | Other sovereign government rated AA/Aa or higher | Canada | ||
Financial Risk Management | ||
Bonds issued by government | 1,923.5 | 614.6 |
Credit risk | Other sovereign government rated AA/Aa or higher | United Kingdom | ||
Financial Risk Management | ||
Bonds issued by government | 180.6 | 7.7 |
Credit risk | Other sovereign government rated AA/Aa or higher | Singapore | ||
Financial Risk Management | ||
Bonds issued by government | 91.3 | 95.1 |
Credit risk | All other sovereign government | ||
Financial Risk Management | ||
Maximum exposure to credit risk | 2,210.2 | 2,194.9 |
Credit risk | All other sovereign government | Brazil | ||
Financial Risk Management | ||
Bonds issued by government | 744.2 | 415.4 |
Credit risk | All other sovereign government | Greece | ||
Financial Risk Management | ||
Bonds issued by government | 690.1 | 844.7 |
Credit risk | All other sovereign government | Spain | ||
Financial Risk Management | ||
Bonds issued by government | 216.2 | 297.5 |
Credit risk | All other sovereign government | Poland | ||
Financial Risk Management | ||
Bonds issued by government | 126.9 | 78.5 |
Credit risk | Canadian provincials | ||
Financial Risk Management | ||
Maximum exposure to credit risk | 284.1 | 45 |
Credit risk | U.S. states and municipalities | ||
Financial Risk Management | ||
Maximum exposure to credit risk | 262.7 | 387.2 |
Credit risk | Corporate and other | ||
Financial Risk Management | ||
Maximum exposure to credit risk | $ 9,451.9 | $ 6,873.9 |
Risk exposure percentage | 17% | 13% |
Credit risk | Short to mid-dated corporate bonds | ||
Financial Risk Management | ||
Net purchases of bonds | $ 2,331.9 | |
Credit risk | Unrated corporate bonds and first mortgage loans | ||
Financial Risk Management | ||
Net purchases of bonds | 870.2 | |
Credit risk | Investments in first mortgage loans | ||
Financial Risk Management | ||
Maximum exposure to credit risk | 2,500.7 | $ 1,659.4 |
Credit risk | Receivable from counterparties to derivative contracts | ||
Financial Risk Management | ||
Maximum exposure to credit risk | 256.1 | 158.9 |
Credit risk | Insurance contract receivables | ||
Financial Risk Management | ||
Maximum exposure to credit risk | 7,907.5 | 6,883.2 |
Credit risk | Recoverable from reinsurers | ||
Financial Risk Management | ||
Maximum exposure to credit risk | 13,115.8 | 12,090.5 |
Credit risk | Other assets | ||
Financial Risk Management | ||
Maximum exposure to credit risk | $ 2,024.6 | $ 1,881.3 |
Financial Risk Management - C_2
Financial Risk Management - Credit Risk - Narrative (Details) - Credit risk - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Financial Risk Management | ||
Capital and surplus requirement | $ 500 | |
Investment grade or better | ||
Financial Risk Management | ||
Risk exposure percentage | 80.10% | 65.10% |
AA or better | ||
Financial Risk Management | ||
Risk exposure percentage | 60.60% | 39.10% |
AAA/Aaa | ||
Financial Risk Management | ||
Risk exposure percentage | 57.70% | 36.10% |
A/A | ||
Financial Risk Management | ||
Risk exposure percentage | 8% | 12.80% |
BBB/Baa | ||
Financial Risk Management | ||
Risk exposure percentage | 11.50% | 13.20% |
BB/Ba | ||
Financial Risk Management | ||
Risk exposure percentage | 6.60% | 12.40% |
Unrated | ||
Financial Risk Management | ||
Risk exposure percentage | 12.80% | 21.30% |
A+ | Munich Reinsurance Company | ||
Financial Risk Management | ||
Risk exposure percentage | 8.20% | 7.50% |
Cash and short term investments | ||
Financial Risk Management | ||
Financial assets pledged as collateral | $ 9.5 | $ 14.3 |
Cash and short term investments | Canada and United States | ||
Financial Risk Management | ||
Risk exposure percentage | 69.40% | 82.70% |
Cash and short term investments | Europe | ||
Financial Risk Management | ||
Risk exposure percentage | 24.80% | 14.90% |
Cash and short term investments | Other foreign countries | ||
Financial Risk Management | ||
Risk exposure percentage | 5.80% | 2.40% |
U.S. treasury bonds and Canadian government bonds | AAA/Aaa | Minimum | ||
Financial Risk Management | ||
Term of the bonds | 1 year | |
U.S. treasury bonds and Canadian government bonds | AAA/Aaa | Maximum | ||
Financial Risk Management | ||
Term of the bonds | 5 years | |
U.S Treasury bonds | AAA/Aaa | ||
Financial Risk Management | ||
Net purchases of bonds | $ 10,721.3 | |
Canadian government bonds | AAA/Aaa | ||
Financial Risk Management | ||
Net purchases of bonds | $ 1,422.1 | |
Other than U.S., U.K., German, and Canadian sovereign government | ||
Financial Risk Management | ||
Risk exposure percentage | 6.50% | 6.50% |
Holdings of bonds in the major issuers to which the company had the greatest exposure | $ 3,599.2 | $ 3,444.5 |
Largest single issuer of corporate bonds | BP Capital Markets America Inc | ||
Financial Risk Management | ||
Risk exposure percentage | 0.80% | |
Holdings of bonds in the major issuers to which the company had the greatest exposure | $ 427.7 | |
Largest single issuer of corporate bonds | Blackberry Limited | ||
Financial Risk Management | ||
Risk exposure percentage | 1% | |
Holdings of bonds in the major issuers to which the company had the greatest exposure | $ 535.1 | |
Government securities | ||
Financial Risk Management | ||
Financial assets pledged as collateral | 274.9 | $ 125.7 |
Corporate bonds | A/A | ||
Financial Risk Management | ||
Net purchases of bonds | 515.1 | |
Corporate bonds | BBB/Baa | ||
Financial Risk Management | ||
Net purchases of bonds | 1,852.4 | |
Unrated corporate bonds and first mortgage loans | ||
Financial Risk Management | ||
Net purchases of bonds | $ 870.2 |
Financial Risk Management - C_3
Financial Risk Management - Credit Risk - Issuer Credit Rating (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Investments in debt instruments | Mosaic Capital | ||
Financial Risk Management | ||
Financial assets | $ 81.7 | |
Unrated | Investments in debt instruments | Blackberry Limited | ||
Financial Risk Management | ||
Financial assets | 285 | $ 535.1 |
Unrated | Investments in debt instruments | JAB Pet Holdings Ltd. | ||
Financial Risk Management | ||
Financial assets | 239.1 | 0 |
Unrated | Investments in debt instruments | Mosaic Capital | ||
Financial Risk Management | ||
Financial assets | 81.7 | 129.3 |
Credit risk | Investments in first mortgage loans | ||
Financial Risk Management | ||
Financial assets | $ 2,500.7 | $ 1,659.4 |
Percentage of loan-to-value ratios | 60% | |
Credit risk | AAA/Aaa | ||
Financial Risk Management | ||
Percent | 57.70% | 36.10% |
Credit risk | AA/Aa | ||
Financial Risk Management | ||
Percent | 2.90% | 3% |
Credit risk | A/A | ||
Financial Risk Management | ||
Percent | 8% | 12.80% |
Credit risk | BBB/Baa | ||
Financial Risk Management | ||
Percent | 11.50% | 13.20% |
Credit risk | BB/Ba | ||
Financial Risk Management | ||
Percent | 6.60% | 12.40% |
Credit risk | B/B | ||
Financial Risk Management | ||
Percent | 0.20% | 0.80% |
Credit risk | Lower than B/B | ||
Financial Risk Management | ||
Percent | 0.30% | 0.40% |
Credit risk | Unrated | ||
Financial Risk Management | ||
Percent | 12.80% | 21.30% |
Credit risk | Total investment in debt instruments | ||
Financial Risk Management | ||
Percent | 100% | 100% |
Credit risk | Amortized cost | AAA/Aaa | ||
Financial Risk Management | ||
Financial assets | $ 17,119.4 | $ 5,248.2 |
Credit risk | Amortized cost | AA/Aa | ||
Financial Risk Management | ||
Financial assets | 858.3 | 435 |
Credit risk | Amortized cost | A/A | ||
Financial Risk Management | ||
Financial assets | 2,409.6 | 1,838.4 |
Credit risk | Amortized cost | BBB/Baa | ||
Financial Risk Management | ||
Financial assets | 3,410.3 | 1,749.9 |
Credit risk | Amortized cost | BB/Ba | ||
Financial Risk Management | ||
Financial assets | 2,114.9 | 1,840.9 |
Credit risk | Amortized cost | B/B | ||
Financial Risk Management | ||
Financial assets | 48.2 | 115 |
Credit risk | Amortized cost | Lower than B/B | ||
Financial Risk Management | ||
Financial assets | 79.7 | 58.4 |
Credit risk | Amortized cost | Unrated | ||
Financial Risk Management | ||
Financial assets | 3,928.2 | 2,935.3 |
Credit risk | Amortized cost | Total investment in debt instruments | ||
Financial Risk Management | ||
Financial assets | 29,968.6 | 14,221.1 |
Credit risk | At fair value | AAA/Aaa | ||
Financial Risk Management | ||
Financial assets | 16,721.6 | 5,237.3 |
Credit risk | At fair value | AA/Aa | ||
Financial Risk Management | ||
Financial assets | 847.6 | 437.7 |
Credit risk | At fair value | A/A | ||
Financial Risk Management | ||
Financial assets | 2,330.6 | 1,865.5 |
Credit risk | At fair value | BBB/Baa | ||
Financial Risk Management | ||
Financial assets | 3,348.7 | 1,914.6 |
Credit risk | At fair value | BB/Ba | ||
Financial Risk Management | ||
Financial assets | 1,917.2 | 1,808.3 |
Credit risk | At fair value | B/B | ||
Financial Risk Management | ||
Financial assets | 49.6 | 114.8 |
Credit risk | At fair value | Lower than B/B | ||
Financial Risk Management | ||
Financial assets | 80 | 62.9 |
Credit risk | At fair value | Unrated | ||
Financial Risk Management | ||
Financial assets | 3,705.9 | 3,092.5 |
Credit risk | At fair value | Total investment in debt instruments | ||
Financial Risk Management | ||
Financial assets | $ 29,001.2 | $ 14,533.6 |
Financial Risk Management - C_4
Financial Risk Management - Credit Risk - Net derivative counterparty risk (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Financial Risk Management | ||
Total derivative assets | $ 256.1 | $ 158.9 |
Obligations that may be offset under net settlement arrangements | (33) | (9.6) |
Fair value of collateral deposited for the benefit of the company | (216) | (116.5) |
Excess collateral pledged by the company in favour of counterparties | 4.6 | 4.8 |
Net derivative counterparty exposure after net settlement and collateral arrangements | 11.7 | 37.6 |
Excess collateral pledged by counterparties | $ 68.4 | $ 22.5 |
Financial Risk Management - C_5
Financial Risk Management - Credit Risk - Recoverable from reinsurers (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Financial Risk Management | |||
Recoverable from reinsurers | $ 13,115.8 | $ 12,090.5 | $ 10,533.2 |
Provision for uncollectible reinsurance | |||
Financial Risk Management | |||
Recoverable from reinsurers | (171.9) | (178.7) | $ (155.6) |
Credit risk | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | 13,115.8 | 12,090.5 | |
Outstanding balances for which security is held | 1,245.2 | 1,381.6 | |
Net unsecured recoverable from reinsurers | 12,042.5 | 10,887.6 | |
Recoverable from reinsurers | 11,870.6 | 10,708.9 | |
Credit risk | Gross recoverable from reinsurers | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | 13,287.7 | 12,269.2 | |
Credit risk | Provision for uncollectible reinsurance | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | (171.9) | (178.7) | |
Net unsecured recoverable from reinsurers | (171.9) | (178.7) | |
Credit risk | A++ | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Outstanding balances for which security is held | 24.2 | 27.2 | |
Net unsecured recoverable from reinsurers | 576.1 | 541 | |
Credit risk | A++ | Gross recoverable from reinsurers | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | 600.3 | 568.2 | |
Credit risk | A+ | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Outstanding balances for which security is held | 444.1 | 494.4 | |
Net unsecured recoverable from reinsurers | 6,187.2 | 5,411.5 | |
Credit risk | A+ | Gross recoverable from reinsurers | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | 6,631.3 | 5,905.9 | |
Credit risk | A | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Outstanding balances for which security is held | 205.9 | 227.3 | |
Net unsecured recoverable from reinsurers | 3,545 | 3,672.5 | |
Credit risk | A | Gross recoverable from reinsurers | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | 3,750.9 | 3,899.8 | |
Credit risk | A- | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Outstanding balances for which security is held | 53.6 | 43.9 | |
Net unsecured recoverable from reinsurers | 424.8 | 328 | |
Credit risk | A- | Gross recoverable from reinsurers | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | 478.4 | 371.9 | |
Credit risk | B++ | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Outstanding balances for which security is held | 4.3 | 4.6 | |
Net unsecured recoverable from reinsurers | 51 | 46.2 | |
Credit risk | B++ | Gross recoverable from reinsurers | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | 55.3 | 50.8 | |
Credit risk | B+ | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Outstanding balances for which security is held | 0.3 | ||
Net unsecured recoverable from reinsurers | 0.8 | 0.2 | |
Credit risk | B+ | Gross recoverable from reinsurers | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | 0.8 | 0.5 | |
Credit risk | B or lower | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Outstanding balances for which security is held | 0.1 | ||
Net unsecured recoverable from reinsurers | 10.6 | 20.1 | |
Credit risk | B or lower | Gross recoverable from reinsurers | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | 10.6 | 20.2 | |
Credit risk | Not rated | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Outstanding balances for which security is held | 506.5 | 576.7 | |
Net unsecured recoverable from reinsurers | 492.3 | 427.3 | |
Credit risk | Not rated | Gross recoverable from reinsurers | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | 998.8 | 1,004 | |
Credit risk | Pools and associations | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Outstanding balances for which security is held | 6.6 | 7.1 | |
Net unsecured recoverable from reinsurers | 754.7 | 440.8 | |
Credit risk | Pools and associations | Gross recoverable from reinsurers | Ceded reinsurance contracts | |||
Financial Risk Management | |||
Recoverable from reinsurers | $ 761.3 | $ 447.9 |
Financial Risk Management - Liq
Financial Risk Management - Liquidity Risk - Holding Company (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |||||||
Jan. 26, 2023 | Oct. 31, 2022 | Sep. 27, 2022 | Sep. 26, 2022 | Aug. 16, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 23, 2021 | |
Financial Risk Management | ||||||||
Common share dividends | $ 513.1 | $ 427.5 | ||||||
Dividend per share (in dollars per share) | $ 10 | $ 10 | ||||||
Holding company cash and investments, net | $ 1,326.4 | $ 1,446.2 | ||||||
RiverStone Barbados | ||||||||
Financial Risk Management | ||||||||
Notional amount | $ 200 | |||||||
Allied World | ||||||||
Financial Risk Management | ||||||||
Equity ownership percentage | 82.90% | 70.90% | ||||||
Purchase consideration | $ 733.5 | |||||||
Loss recognized in retained earnings due to changes in capitalization of non-controlling interests | $ 228.1 | |||||||
JAB Consumer Fund | Crum & Forster Pet Insurance Group and Pethealth | ||||||||
Financial Risk Management | ||||||||
Debentures received as consideration in sale of business interests | $ 250 | |||||||
Holding company | ||||||||
Financial Risk Management | ||||||||
Notional amount | 5,932.6 | 5,385.2 | ||||||
Holding company | Payment of dividends | ||||||||
Financial Risk Management | ||||||||
Common share dividends | $ 245.2 | |||||||
Dividend per share (in dollars per share) | $ 10 | |||||||
Holding company | Revolving credit facility | ||||||||
Financial Risk Management | ||||||||
Maximum borrowing capacity | 2,000 | |||||||
Holding company | 5.625% due August 16, 2032 | ||||||||
Financial Risk Management | ||||||||
Notional amount | $ 750 | $ 750 | ||||||
Interest rate | 5.625% | 5.625% | ||||||
Net proceeds from issuance of notes after discount, commissions and expenses | $ 743.4 | $ 743.4 | ||||||
Holding company | Long equity total return swap contracts | ||||||||
Financial Risk Management | ||||||||
Cash received from settlement of derivative contracts | 269.1 | 262.7 | ||||||
Holding company | Long equity total return swaps on Fairfax subordinate voting shares | ||||||||
Financial Risk Management | ||||||||
Cash received from settlement of derivative contracts | 154.8 | $ 130.9 | ||||||
Holding company | RiverStone Barbados | Financial Guarantee, Securities | ||||||||
Financial Risk Management | ||||||||
Financial guarantee contract | 486.8 | |||||||
Holding company | RiverStone Barbados | Financial Guarantee, Derivative Assets | ||||||||
Financial Risk Management | ||||||||
Financial guarantee contract | $ 30.7 | |||||||
Holding company | JAB Consumer Fund | Crum & Forster Pet Insurance Group and Pethealth | ||||||||
Financial Risk Management | ||||||||
Net cash proceeds from sale of interests in subsidiary | $ 940 |
Financial Risk Management - L_2
Financial Risk Management - Liquidity Risk - Insurance and reinsurance subsidiaries and Non-insurance companies (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Financial Risk Management | ||
Portfolio investments cash and investments, net | $ 54,151.3 | $ 51,576.6 |
Insurance and reinsurance companies | Fairfax India | ||
Financial Risk Management | ||
Investments lacking liquidity or inactively traded | 1,117.5 | 1,129.6 |
Insurance and reinsurance companies | Long equity total return swap contracts | ||
Financial Risk Management | ||
Cash payments on settlement of derivative contracts | 30.9 | |
Cash received from settlement of derivative contracts | $ 176.9 | |
Non-insurance companies | AGT credit facilities | ||
Financial Risk Management | ||
Repayments of borrowings in next fiscal year | $ 371.8 | |
Liquidity risk | Insurance and reinsurance companies | Investments that may lack liquidity or are inactively traded | ||
Financial Risk Management | ||
Risk exposure percentage | 14.10% | 12.70% |
Financial Risk Management - L_3
Financial Risk Management - Liquidity Risk - Financial Liabilities Maturity (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Financial Risk Management | ||
Insurance contract payables | $ 5,061.9 | $ 4,493.5 |
Borrowings - principal | 8,673.5 | |
Non-insurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 2,013.2 | |
More than five years | ||
Financial Risk Management | ||
Borrowings - principal | 5,502.6 | |
More than five years | Non-insurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 798.2 | |
Liquidity risk | ||
Financial Risk Management | ||
Accounts payable and accrued liabilities | 4,730.8 | 4,458.3 |
Insurance contract payables | 4,483.5 | 3,970.8 |
Provision for losses and loss adjustment expenses | 38,319.2 | 34,422.8 |
Provision for life policy benefits | 2,529.7 | 2,675.8 |
Total financial liabilities | 61,069.5 | 55,508.1 |
Liquidity risk | Holding company and insurance and reinsurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 6,660.3 | 6,169 |
Borrowings - interest | 1,921.6 | 1,810.3 |
Liquidity risk | Non-insurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 2,013.2 | 1,633.3 |
Borrowings - interest | 411.2 | 367.8 |
Liquidity risk | 3 months or less | ||
Financial Risk Management | ||
Accounts payable and accrued liabilities | 1,521.1 | 1,586.6 |
Insurance contract payables | 939.9 | 1,026.7 |
Provision for losses and loss adjustment expenses | 3,428.6 | 2,925.1 |
Provision for life policy benefits | 45.5 | 72 |
Total financial liabilities | 6,300.9 | 6,227 |
Liquidity risk | 3 months or less | Holding company and insurance and reinsurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 0.1 | 0.1 |
Borrowings - interest | 84.3 | 66 |
Liquidity risk | 3 months or less | Non-insurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 254.5 | 512.2 |
Borrowings - interest | 26.9 | 38.3 |
Liquidity risk | 3 months to 1 year | ||
Financial Risk Management | ||
Accounts payable and accrued liabilities | 1,158.4 | 821.6 |
Insurance contract payables | 2,600.7 | 1,970 |
Provision for losses and loss adjustment expenses | 8,506.6 | 7,033.9 |
Provision for life policy benefits | 161 | 162.7 |
Total financial liabilities | 12,822.4 | 10,290.3 |
Liquidity risk | 3 months to 1 year | Holding company and insurance and reinsurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 0.2 | 0.2 |
Borrowings - interest | 209.2 | 193.8 |
Liquidity risk | 3 months to 1 year | Non-insurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 117.3 | 72.2 |
Borrowings - interest | 69 | 35.9 |
Liquidity risk | 1 - 3 years | ||
Financial Risk Management | ||
Accounts payable and accrued liabilities | 1,090.7 | 1,131.3 |
Insurance contract payables | 242.2 | 346.4 |
Provision for losses and loss adjustment expenses | 10,944.1 | 10,662.4 |
Provision for life policy benefits | 455.6 | 585 |
Total financial liabilities | 15,281.5 | 13,898.8 |
Liquidity risk | 1 - 3 years | Holding company and insurance and reinsurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 1,051.4 | 283.1 |
Borrowings - interest | 567 | 520 |
Liquidity risk | 1 - 3 years | Non-insurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 781.9 | 270.8 |
Borrowings - interest | 148.6 | 99.8 |
Liquidity risk | 3 - 5 years | ||
Financial Risk Management | ||
Accounts payable and accrued liabilities | 395.9 | 399.1 |
Insurance contract payables | 39.5 | 16.1 |
Provision for losses and loss adjustment expenses | 5,965.6 | 5,391.2 |
Provision for life policy benefits | 631.8 | 575.7 |
Total financial liabilities | 8,544.1 | 8,218.7 |
Liquidity risk | 3 - 5 years | Holding company and insurance and reinsurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 904.2 | 1,270.8 |
Borrowings - interest | 462.2 | 445.6 |
Liquidity risk | 3 - 5 years | Non-insurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 61.3 | 41.3 |
Borrowings - interest | 83.6 | 78.9 |
Liquidity risk | More than five years | ||
Financial Risk Management | ||
Accounts payable and accrued liabilities | 564.7 | 519.7 |
Insurance contract payables | 661.2 | 611.6 |
Provision for losses and loss adjustment expenses | 9,474.3 | 8,410.2 |
Provision for life policy benefits | 1,235.8 | 1,280.4 |
Total financial liabilities | 18,120.6 | 16,873.3 |
Liquidity risk | More than five years | Holding company and insurance and reinsurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 4,704.4 | 4,614.8 |
Borrowings - interest | 598.9 | 584.9 |
Liquidity risk | More than five years | Non-insurance companies | ||
Financial Risk Management | ||
Borrowings - principal | 798.2 | 736.8 |
Borrowings - interest | $ 83.1 | $ 114.9 |
Financial Risk Management - L_4
Financial Risk Management - Liquidity Risk - Derivative Financial Liabilities (Details) - Liquidity risk - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Financial Risk Management | ||
Derivative financial liabilities | $ 191 | $ 152.9 |
3 months or less | ||
Financial Risk Management | ||
Derivative financial liabilities | 95.8 | 74.7 |
3 months to 1 year | ||
Financial Risk Management | ||
Derivative financial liabilities | 43.8 | 31.8 |
More than 1 year | ||
Financial Risk Management | ||
Derivative financial liabilities | 51.4 | 46.4 |
Equity total return swaps - long positions | ||
Financial Risk Management | ||
Derivative financial liabilities | 19.4 | 1.9 |
Equity total return swaps - long positions | 3 months or less | ||
Financial Risk Management | ||
Derivative financial liabilities | 19.1 | 1.8 |
Equity total return swaps - long positions | 3 months to 1 year | ||
Financial Risk Management | ||
Derivative financial liabilities | 0.3 | 0.1 |
Foreign currency forward and swap contracts | ||
Financial Risk Management | ||
Derivative financial liabilities | 106.8 | 77.4 |
Foreign currency forward and swap contracts | 3 months or less | ||
Financial Risk Management | ||
Derivative financial liabilities | 51.1 | 26.4 |
Foreign currency forward and swap contracts | 3 months to 1 year | ||
Financial Risk Management | ||
Derivative financial liabilities | 5 | 5 |
Foreign currency forward and swap contracts | More than 1 year | ||
Financial Risk Management | ||
Derivative financial liabilities | 50.7 | 46 |
Other derivative contracts | ||
Financial Risk Management | ||
Derivative financial liabilities | 64.8 | 73.6 |
Other derivative contracts | 3 months or less | ||
Financial Risk Management | ||
Derivative financial liabilities | 25.6 | 46.5 |
Other derivative contracts | 3 months to 1 year | ||
Financial Risk Management | ||
Derivative financial liabilities | 38.5 | 26.7 |
Other derivative contracts | More than 1 year | ||
Financial Risk Management | ||
Derivative financial liabilities | $ 0.7 | $ 0.4 |
Financial Risk Management - Mar
Financial Risk Management - Market Risk - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Financial Risk Management | ||
Assets | $ 92,125.1 | $ 86,645.4 |
Recurring fair value measurement | ||
Financial Risk Management | ||
Assets | 48,043.8 | 46,918.8 |
Long-dated U.S. Treasury bonds | ||
Financial Risk Management | ||
Notional amount | $ 183.7 | 1,691.3 |
Interest rate risk | ||
Financial Risk Management | ||
Change in interest rate on investments | 2% | |
Incremental change in interest rate on investments | 1% | |
Interest rate risk | Debt securities | Recurring fair value measurement | ||
Financial Risk Management | ||
Assets | $ 29,000 | 14,500 |
Interest rate risk | U.S Treasury bonds | ||
Financial Risk Management | ||
Net proceeds | 10,721.3 | |
Interest rate risk | Canadian government bonds | ||
Financial Risk Management | ||
Net proceeds | 1,422.1 | |
Interest rate risk | Short-dated corporate bonds | ||
Financial Risk Management | ||
Net proceeds | 2,202.6 | |
Interest rate risk | Long-dated U.S. Treasury bonds | ||
Financial Risk Management | ||
Notional amount | $ 183.7 | $ 1,691.3 |
Financial Risk Management - M_2
Financial Risk Management - Market Risk - Interest rate sensitivity analysis (Details) - Debt securities - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Financial Risk Management | ||
Fair value of fixed income portfolio, no change | $ 29,001.2 | $ 14,533.6 |
Interest rate risk | ||
Financial Risk Management | ||
Fair value of fixed income portfolio, 200 basis point increase | 27,944 | 13,984 |
Fair value of fixed income portfolio, 100 basis point increase | 28,461.5 | 14,239.6 |
Fair value of fixed income portfolio, no change | 29,001.2 | 14,533.6 |
Fair value of fixed income portfolio, 100 basis point decrease | 29,616.2 | 14,900.9 |
Fair value of fixed income portfolio, 200 basis point decrease | 30,289 | 15,327.9 |
Hypothetical $ change effect on net earnings, 200 basis point increase | (852.9) | (418.4) |
Hypothetical $ change effect on net earnings, 100 basis point increase | (435.4) | (224.3) |
Hypothetical $ change effect on net earnings, 100 basis point decrease | 496.4 | 280.6 |
Hypothetical $ change effect on net earnings, 200 basis point decrease | $ 1,039.7 | $ 607.5 |
Hypothetical % change in fair value, 200 basis point increase | (3.70%) | (3.80%) |
Hypothetical % change in fair value, 100 basis point increase | (1.90%) | (2.00%) |
Hypothetical % change in fair value, 100 basis point decrease | 2.10% | 2.50% |
Hypothetical % change in fair value, 200 basis point decrease | 4.40% | 5.50% |
Financial Risk Management - M_3
Financial Risk Management - Market Risk - Equity and equity-related holdings (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Financial Risk Management | ||
Net gains (losses) on investments | $ (1,733.9) | $ 3,445.1 |
Cash proceeds from sales of interests in associates | 192.9 | 809.2 |
IIFL Finance Limited | ||
Financial Risk Management | ||
Net gain on sale of investments | 42 | |
Common stocks | ||
Financial Risk Management | ||
Net gains (losses) on investments | (242.7) | 1,333.4 |
Net gain on sale of investments | 364.5 | 483.4 |
Preferred stocks | ||
Financial Risk Management | ||
Net gains (losses) on investments | (4.4) | 2.8 |
Net gain on sale of investments | 1.4 | 0.7 |
Equity price risk | ||
Financial Risk Management | ||
Investments in associates, at fair value | 8,183.3 | 7,192.1 |
Exposure/Notional amount | 15,952.4 | 16,265.7 |
Carrying value | 12,749.1 | 12,435.3 |
Net gains (losses) on investments | (243.8) | 2,312.1 |
Equity price risk | Common stocks | ||
Financial Risk Management | ||
Exposure/Notional amount | 5,234.4 | 5,845.5 |
Carrying value | 5,234.4 | 5,845.5 |
Net gains (losses) on investments | (242.7) | 1,333.4 |
Equity price risk | Preferred stocks | ||
Financial Risk Management | ||
Exposure/Notional amount | 44.2 | 54.5 |
Carrying value | 44.2 | 54.5 |
Net gains (losses) on investments | (4.4) | 2.8 |
Equity price risk | Bonds - convertible | ||
Financial Risk Management | ||
Exposure/Notional amount | 414.5 | 583.4 |
Carrying value | 414.5 | 583.4 |
Net gains (losses) on investments | (237) | 101.3 |
Equity price risk | Investments in associates | ||
Financial Risk Management | ||
Exposure/Notional amount | 8,183.3 | 7,192.1 |
Carrying value | 6,786.6 | 5,496.6 |
Net gains (losses) on investments | 45.1 | 52.7 |
Equity price risk | Sale and deconsolidation of non-insurance subsidiaries | ||
Financial Risk Management | ||
Net gains (losses) on investments | 4.4 | 190.3 |
Equity price risk | Equity derivatives | ||
Financial Risk Management | ||
Exposure/Notional amount | 2,076 | 2,590.2 |
Carrying value | 269.4 | 455.3 |
Net gains (losses) on investments | 190.8 | 631.6 |
Equity price risk | Long equity total return swaps on Fairfax subordinate voting shares | ||
Financial Risk Management | ||
Net gains (losses) on investments | $ 255.4 | $ 222.7 |
Financial Risk Management - M_4
Financial Risk Management - Market Risk - Impact on Net Earnings (Details) - Equity price risk - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Financial Risk Management | ||
Fair value of equity and equity-related holdings, 20% increase | $ 9,297.5 | $ 10,861.1 |
Fair value of equity and equity-related holdings, 10% increase | 8,531.9 | 9,966.1 |
Fair value of equity and equity-related holdings, no change | 7,769.1 | 9,073.6 |
Fair value of equity and equity-related holdings, 10% decrease | 7,010.3 | 8,184.4 |
Fair value of equity and equity-related holdings, 20% decrease | 6,258.5 | 7,297.3 |
Hypothetical $ change effect on net earnings, 20% increase | 1,301.9 | 1,549.7 |
Hypothetical $ change effect on net earnings, 10% increase | 649.8 | 773.5 |
Hypothetical $ change effect on net earnings, 10% decrease | (646.8) | (770.6) |
Hypothetical $ change effect on net earnings, 20% decrease | $ (1,287.8) | $ (1,538.8) |
Hypothetical % change in fair value, 20% increase | 19.70% | 19.70% |
Hypothetical % change in fair value, 10% increase | 9.80% | 9.80% |
Hypothetical % change in fair value, no change | 0% | |
Hypothetical % change in fair value, 10% decrease | (9.80%) | (9.80%) |
Hypothetical % change in fair value, 20% decrease | (19.40%) | (19.60%) |
Financial asset investments | $ 12,749.1 | $ 12,435.3 |
Minimum | ||
Financial Risk Management | ||
Change in interest rate on investments | 10% | 10% |
Maximum | ||
Financial Risk Management | ||
Change in interest rate on investments | 20% | 20% |
Investment Portfolio With Ten Largest Issuers | ||
Financial Risk Management | ||
Financial asset investments | $ 6,958.2 | $ 6,048.7 |
Risk exposure percentage | 12.50% | 11.40% |
Investment Portfolio With Single Largest Issuer | Eurobank | ||
Financial Risk Management | ||
Financial asset investments | $ 1,507.6 | $ 1,298.4 |
Risk exposure percentage | 2.70% | 2.40% |
Financial Risk Management - M_5
Financial Risk Management - Market Risk - Foreign currency risk (Details) - Foreign currency risk € in Millions, $ in Millions, $ in Millions | 12 Months Ended | |||||
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2022 CAD ($) | Dec. 31, 2022 EUR (€) | Dec. 31, 2021 CAD ($) | Dec. 31, 2021 EUR (€) | |
Net gains (losses) on investments: | ||||||
Investing activities | $ (366.5) | $ (122.3) | ||||
Underwriting activities | 8.6 | 41.2 | ||||
Foreign currency contracts | 53.6 | (12) | ||||
Foreign currency net losses | (304.3) | (93.1) | ||||
Hedges of net investment in Canadian subsidiaries | Unsecured senior notes | ||||||
Financial Risk Management | ||||||
Debt hedges | $ 2,800 | $ 2,800 | ||||
Debt hedges at fair value | 1,926.8 | 2,364.6 | ||||
Gains (losses) on hedge of net investment in Canadian subsidiaries | 149.5 | (16.7) | ||||
Hedges of net investment in European operations | Unsecured senior notes | ||||||
Financial Risk Management | ||||||
Debt hedges | € | € 750 | € 750 | ||||
Debt hedges at fair value | 698.3 | 926.3 | ||||
Gains (losses) on hedge of net investment in Canadian subsidiaries | $ 51.8 | $ 63.9 |
Financial Risk Management - M_6
Financial Risk Management - Market Risk - Foreign currency effects on the consolidated statement of earnings (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Canadian dollar | ||
Financial Risk Management | ||
Assets | $ 1,751 | $ 1,863.4 |
Liabilities | (791) | (671.6) |
Net asset exposure before hedge of net investment | 960 | 1,191.8 |
Notional long (short) amount of foreign currency forward contracts | (1,258.2) | (1,251.2) |
Net asset (liability) exposure after foreign currency forward contracts | (298.2) | (59.4) |
Hypothetical change in pre-tax earnings (loss) | 29.8 | 5.9 |
Hypothetical change in net earnings (loss) | 23.7 | 1.7 |
Euro | ||
Financial Risk Management | ||
Assets | 1,033.2 | 905.5 |
Liabilities | (1,275.4) | (1,134.2) |
Net asset exposure before hedge of net investment | (242.2) | (228.7) |
Notional long (short) amount of foreign currency forward contracts | (208.7) | (84.9) |
Net asset (liability) exposure after foreign currency forward contracts | (450.9) | (313.6) |
Hypothetical change in pre-tax earnings (loss) | 45.1 | 31.4 |
Hypothetical change in net earnings (loss) | 36.6 | 26.9 |
British pound sterling | ||
Financial Risk Management | ||
Assets | 1,739.4 | 1,748.6 |
Liabilities | (2,252.8) | (2,156.6) |
Net asset exposure before hedge of net investment | (513.4) | (408) |
Notional long (short) amount of foreign currency forward contracts | 87 | (8.4) |
Net asset (liability) exposure after foreign currency forward contracts | (426.4) | (416.4) |
Hypothetical change in pre-tax earnings (loss) | 42.6 | 41.6 |
Hypothetical change in net earnings (loss) | 37.6 | 35.5 |
Indian rupee | ||
Financial Risk Management | ||
Assets | 1,872.9 | 2,795 |
Liabilities | (252.9) | (273.7) |
Net asset exposure before hedge of net investment | 1,620 | 2,521.3 |
Notional long (short) amount of foreign currency forward contracts | 3.4 | 4.2 |
Net asset (liability) exposure after foreign currency forward contracts | 1,623.4 | 2,525.5 |
Hypothetical change in pre-tax earnings (loss) | (162.3) | (252.6) |
Hypothetical change in net earnings (loss) | $ (161.2) | $ (235.8) |
Foreign currency risk | ||
Financial Risk Management | ||
Sensitivity analysis, percentage of appreciation the U.S. dollar against foreign currency | 10% |
Financial Risk Management - M_7
Financial Risk Management - Market Risk - Foreign currency effects on the consolidated statement of other comprehensive income (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Canadian dollar | ||
Financial Risk Management | ||
Assets | $ 11,055.5 | $ 11,028.6 |
Liabilities | (7,129) | (6,719.6) |
Net asset exposure before hedge of net investment | 3,926.5 | 4,309 |
Hedge of net investment | (2,057.7) | (2,205.5) |
Net asset exposure after hedge of net investment | 1,868.8 | 2,103.5 |
Hypothetical change in pre-tax other comprehensive income (loss) | (186.9) | (210.4) |
Hypothetical change in other comprehensive income (loss) | (181.3) | (209.3) |
Euro | ||
Financial Risk Management | ||
Assets | 8,269.4 | 7,549.2 |
Liabilities | (6,844.3) | (6,066.3) |
Net asset exposure before hedge of net investment | 1,425.1 | 1,482.9 |
Hedge of net investment | (792.2) | (842.4) |
Net asset exposure after hedge of net investment | 632.9 | 640.5 |
Hypothetical change in pre-tax other comprehensive income (loss) | (63.3) | (64.1) |
Hypothetical change in other comprehensive income (loss) | (35.7) | (40) |
British pound sterling | ||
Financial Risk Management | ||
Assets | 1,783.3 | 1,793.8 |
Liabilities | (1,339.1) | (1,292.7) |
Net asset exposure before hedge of net investment | 444.2 | 501.1 |
Net asset exposure after hedge of net investment | 444.2 | 501.1 |
Hypothetical change in pre-tax other comprehensive income (loss) | (44.4) | (50.1) |
Hypothetical change in other comprehensive income (loss) | (43.5) | (49.1) |
Indian rupee | ||
Financial Risk Management | ||
Assets | 3,697.6 | 3,663.6 |
Liabilities | (1,251.3) | (1,184.8) |
Net asset exposure before hedge of net investment | 2,446.3 | 2,478.8 |
Net asset exposure after hedge of net investment | 2,446.3 | 2,478.8 |
Hypothetical change in pre-tax other comprehensive income (loss) | (244.6) | (247.9) |
Hypothetical change in other comprehensive income (loss) | $ (228) | $ (230.5) |
Financial Risk Management - Cap
Financial Risk Management - Capital Management - Financial measurements and ratios (Details) $ in Millions, $ in Millions | Dec. 31, 2022 USD ($) | Dec. 31, 2022 CAD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) |
Financial Risk Management | ||||
Capitalization | $ 28,960.7 | $ 29,068.3 | ||
Holding company cash and investments (net of derivative obligations) | 1,326.4 | 1,446.2 | ||
Borrowings | 8,624.9 | 7,753 | $ 8,814 | |
Net debt | 7,298.5 | 6,306.8 | ||
Non-controlling interests | 3,659.6 | 4,930.2 | ||
Total equity | $ 20,335.8 | $ 21,315.3 | 17,527.3 | |
Net debt/total equity | 35.90% | 35.90% | 29.60% | |
Net debt/net total capital | 26.40% | 26.40% | 22.80% | |
Total debt/total capital | 29.80% | 29.80% | 26.70% | |
Interest coverage | 5.2 | 5.2 | 10.6 | |
Interest and preferred share dividend distribution coverage | 4.5 | 4.5 | 9.4 | |
Common shares | ||||
Financial Risk Management | ||||
Equity in stock | $ 15,340.7 | $ 15,049.6 | ||
Preferred shares | ||||
Financial Risk Management | ||||
Equity in stock | 1,335.5 | $ 1,456 | 1,335.5 | |
Holding company | ||||
Financial Risk Management | ||||
Borrowings | 5,887.6 | 5,338.6 | 5,580.6 | |
Insurance and reinsurance companies | ||||
Financial Risk Management | ||||
Borrowings | 733.4 | 790.7 | 1,033.4 | |
Non-insurance companies | ||||
Financial Risk Management | ||||
Borrowings | 2,003.9 | 1,623.7 | $ 2,200 | |
Excluding consolidated non-insurance companies | ||||
Financial Risk Management | ||||
Holding company cash and investments (net of derivative obligations) | 1,326.4 | 1,446.2 | ||
Borrowings | 6,621 | 6,129.3 | ||
Net debt | 5,294.6 | 4,683.1 | ||
Non-controlling interests | 1,969.2 | 2,931.4 | ||
Total equity | $ 18,645.4 | $ 19,316.5 | ||
Net debt/total equity | 28.40% | 28.40% | 24.20% | |
Net debt/net total capital | 22.10% | 22.10% | 19.50% | |
Total debt/total capital | 26.20% | 26.20% | 24.10% | |
Interest coverage | 5.9 | 5.9 | 13 | |
Interest and preferred share dividend distribution coverage | 4.9 | 4.9 | 11.1 | |
Excluding consolidated non-insurance companies | Common shares | ||||
Financial Risk Management | ||||
Equity in stock | $ 15,340.7 | $ 15,049.6 | ||
Excluding consolidated non-insurance companies | Preferred shares | ||||
Financial Risk Management | ||||
Equity in stock | 1,335.5 | 1,335.5 | ||
Excluding consolidated non-insurance companies | Holding company | ||||
Financial Risk Management | ||||
Borrowings | 5,887.6 | 5,338.6 | ||
Excluding consolidated non-insurance companies | Insurance and reinsurance companies | ||||
Financial Risk Management | ||||
Borrowings | $ 733.4 | $ 790.7 |
Financial Risk Management - C_6
Financial Risk Management - Capital Management - Additional disclosures (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Financial Risk Management | ||
Net earnings attributable to shareholders of Fairfax | $ 1,147.2 | $ 3,401.1 |
Net unrealized foreign currency translation losses net of hedges | 399.1 | |
Changes in capitalization | 1,244.5 | (1,779.8) |
Purchases of subordinate voting shares for cancellation | 199.6 | $ 1,058.1 |
Amount of shares to be utilized for share-based payment awards | 148.2 | |
Payments of common and preferred share dividends | $ 295.1 | |
Percentage of consolidated net debt/net total capital ratio | 26.40% | 22.80% |
Percentage of consolidated total debt/total capital ratio | 29.80% | 26.70% |
National Association of Insurance Commissioners | ||
Financial Risk Management | ||
Capital and surplus, regulatory minimum requirement multiplier | 2 | 2 |
Bermuda Monetary Authority | ||
Financial Risk Management | ||
Target capital level percentage | 120% | 120% |
Office of the Superintendent of Financial Institutions | ||
Financial Risk Management | ||
Minimum supervisory target | 150% | 150% |
Common shareholders' equity | ||
Financial Risk Management | ||
Changes in capitalization | $ 173.6 | $ (552.9) |
Purchases of subordinate voting shares for cancellation | 199.6 | 1,058.1 |
Unsecured senior notes | ||
Financial Risk Management | ||
Principal amount | $ 750 | |
Interest rate | 5.625% | |
Allied World and Recipe | Common shareholders' equity | ||
Financial Risk Management | ||
Changes in capitalization | $ 173.6 | |
Brit Limited (Brit) | ||
Financial Risk Management | ||
Subordinated debt and contingent funding in the form of letters of credit | 2,052.7 | 2,199.5 |
Surplus over the management capital requirements | $ 709.5 | $ 617.9 |
Northbridge | Office of the Superintendent of Financial Institutions | ||
Financial Risk Management | ||
Weighted average MCT ratio | 241% | 222% |
Odyssey Group, Crum & Forster, Zenith National, Allied World and U.S. Run-off excluding TIG Insurance | National Association of Insurance Commissioners | Minimum | ||
Financial Risk Management | ||
Capital and surplus, actual multiplier | 3 | 3 |
TIG Insurance | National Association of Insurance Commissioners | Minimum | ||
Financial Risk Management | ||
Capital and surplus, actual multiplier | 2 | 2.3 |
Ordinary shares | ||
Financial Risk Management | ||
Equity in stock | $ 15,340.7 | $ 15,049.6 |
Segmented Information - Operati
Segmented Information - Operating Segments (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segmented Information | ||
Gross premiums written | $ 27,912.6 | $ 23,910.2 |
Net premiums written | 22,271.7 | 18,278.1 |
Net premiums earned | 21,006.1 | 16,558 |
Underwriting expenses | (20,067.6) | (16,065.5) |
Underwriting profit (loss) | 938.5 | 492.5 |
Interest income | 873.5 | 568.4 |
Dividends | 140.4 | 108.2 |
Investment expenses | (52.1) | (35.8) |
Interest and dividends | 961.8 | 640.8 |
Share of profit of associates | 1,014.7 | 402 |
Other Revenue | 5,581.6 | 5,158 |
Other Expenses | (5,520.9) | (5,086.9) |
Other Revenue (Expenses) | 60.7 | 71.1 |
Operating income (loss) | 2,975.7 | 1,606.4 |
Net gains (losses) on investments | (1,733.9) | 3,445.1 |
Gain on sale and consolidation of insurance subsidiaries | 1,219.7 | 264 |
Interest expense | (452.8) | (513.9) |
Corporate overhead and other | (296.7) | (409) |
Earnings before income taxes | 1,712 | 4,392.6 |
Provision for income taxes | (425.2) | (726) |
Shareholders of Fairfax | 1,147.2 | 3,401.1 |
Non-controlling interests | 139.6 | 265.5 |
Net earnings (loss) | 1,286.8 | 3,666.6 |
Privi | ||
Segmented Information | ||
After tax gain amount | 94.9 | |
Toys "R" Us Canada | ||
Segmented Information | ||
After tax gain amount | 85.7 | |
External | ||
Segmented Information | ||
Gross premiums written | 27,912.6 | 23,910.2 |
Net premiums earned | 21,006.1 | 16,558 |
Property and Casualty Insurance and Reinsurance | ||
Segmented Information | ||
Net premiums earned | 20,663.7 | 16,090.2 |
Property and Casualty Insurance and Reinsurance | North American Insurers | ||
Segmented Information | ||
Net premiums earned | 6,107.8 | 5,024.8 |
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | ||
Segmented Information | ||
Net premiums earned | 12,726.9 | 9,451.8 |
Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | ||
Segmented Information | ||
Net premiums earned | 1,829 | 1,613.6 |
Life insurance and Run-off | ||
Segmented Information | ||
Net premiums earned | 342.4 | 467.8 |
Non-insurance companies | ||
Segmented Information | ||
Interest and dividends | 26.6 | (94.7) |
Share of profit of associates | 134 | 22.3 |
Non-controlling interests | 136.8 | 44.3 |
Operating segments | Property and Casualty Insurance and Reinsurance | ||
Segmented Information | ||
Gross premiums written | 27,925.7 | 24,093.5 |
Net premiums written | 21,927 | 17,809.4 |
Net premiums earned | 20,663.7 | 16,090.2 |
Underwriting expenses | (19,558.4) | (15,289) |
Underwriting profit (loss) | 1,105.3 | 801.2 |
Interest income | 795.8 | 520.8 |
Dividends | 102.9 | 72.7 |
Investment expenses | (152.6) | (151.8) |
Interest and dividends | 746.1 | 441.7 |
Share of profit of associates | 721.5 | 324.1 |
Operating income (loss) | 2,572.9 | 1,567 |
Net gains (losses) on investments | (1,759.9) | 2,644.5 |
Gain on sale and consolidation of insurance subsidiaries | 1,219.7 | 133.5 |
Interest expense | (59.8) | (61.5) |
Corporate overhead and other | (150.8) | (164) |
Earnings before income taxes | 1,822.1 | 4,119.5 |
Operating segments | Property and Casualty Insurance and Reinsurance | External | ||
Segmented Information | ||
Gross premiums written | 27,561.7 | 23,796 |
Net premiums earned | 20,663.7 | 16,448.3 |
Operating segments | Property and Casualty Insurance and Reinsurance | Intercompany | ||
Segmented Information | ||
Gross premiums written | 364 | 297.5 |
Net premiums earned | (358.1) | |
Operating segments | Property and Casualty Insurance and Reinsurance | North American Insurers | ||
Segmented Information | ||
Gross premiums written | 7,650.5 | 6,578.8 |
Net premiums written | 6,457.6 | 5,319.7 |
Net premiums earned | 6,107.8 | 5,024.8 |
Underwriting expenses | (5,674.8) | (4,637.9) |
Underwriting profit (loss) | 433 | 386.9 |
Interest income | 249 | 154.4 |
Dividends | 32 | 23.9 |
Investment expenses | (47) | (43.2) |
Interest and dividends | 234 | 135.1 |
Share of profit of associates | 239.8 | 103.6 |
Operating income (loss) | 906.8 | 625.6 |
Net gains (losses) on investments | (397.7) | 518.5 |
Gain on sale and consolidation of insurance subsidiaries | 1,213.2 | |
Interest expense | (5.7) | (8.6) |
Corporate overhead and other | (39.8) | (53.7) |
Earnings before income taxes | 1,676.8 | 1,081.8 |
Operating segments | Property and Casualty Insurance and Reinsurance | North American Insurers | External | ||
Segmented Information | ||
Gross premiums written | 7,600.9 | 6,544.6 |
Net premiums earned | 6,140.8 | 5,435.3 |
Operating segments | Property and Casualty Insurance and Reinsurance | North American Insurers | Intercompany | ||
Segmented Information | ||
Gross premiums written | 49.6 | 34.2 |
Net premiums earned | (33) | (410.5) |
Operating segments | Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | ||
Segmented Information | ||
Gross premiums written | 17,096.6 | 14,661.4 |
Net premiums written | 13,506.3 | 10,755.5 |
Net premiums earned | 12,726.9 | 9,451.8 |
Underwriting expenses | (12,067.9) | (9,077.6) |
Underwriting profit (loss) | 659 | 374.2 |
Interest income | 447.8 | 299.6 |
Dividends | 54.9 | 37.2 |
Investment expenses | (89.4) | (100.1) |
Interest and dividends | 413.3 | 236.7 |
Share of profit of associates | 429.3 | 184.8 |
Operating income (loss) | 1,501.6 | 795.7 |
Net gains (losses) on investments | (1,151.1) | 604.1 |
Gain on sale and consolidation of insurance subsidiaries | 68.7 | |
Interest expense | (51.1) | (50.5) |
Corporate overhead and other | (98.9) | (88) |
Earnings before income taxes | 200.5 | 1,330 |
Operating segments | Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | External | ||
Segmented Information | ||
Gross premiums written | 16,995.6 | 14,567.6 |
Net premiums earned | 12,851.5 | 9,530.6 |
Operating segments | Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | Intercompany | ||
Segmented Information | ||
Gross premiums written | 101 | 93.8 |
Net premiums earned | (124.6) | (78.8) |
Operating segments | Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | ||
Segmented Information | ||
Gross premiums written | 3,178.6 | 2,853.3 |
Net premiums written | 1,963.1 | 1,734.2 |
Net premiums earned | 1,829 | 1,613.6 |
Underwriting expenses | (1,815.7) | (1,573.5) |
Underwriting profit (loss) | 13.3 | 40.1 |
Interest income | 99 | 66.8 |
Dividends | 16 | 11.6 |
Investment expenses | (16.2) | (8.5) |
Interest and dividends | 98.8 | 69.9 |
Share of profit of associates | 52.4 | 35.7 |
Operating income (loss) | 164.5 | 145.7 |
Net gains (losses) on investments | (211.1) | 1,521.9 |
Gain on sale and consolidation of insurance subsidiaries | 6.5 | 64.8 |
Interest expense | (3) | (2.4) |
Corporate overhead and other | (12.1) | (22.3) |
Earnings before income taxes | (55.2) | 1,707.7 |
Operating segments | Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | External | ||
Segmented Information | ||
Gross premiums written | 2,965.2 | 2,683.8 |
Net premiums earned | 1,671.4 | 1,482.4 |
Operating segments | Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | Intercompany | ||
Segmented Information | ||
Gross premiums written | 213.4 | 169.5 |
Net premiums earned | 157.6 | 131.2 |
Operating segments | Life insurance and Run-off | ||
Segmented Information | ||
Gross premiums written | 350.9 | 472.3 |
Net premiums written | 344.7 | 468.7 |
Net premiums earned | 342.4 | 467.8 |
Underwriting expenses | (509.7) | (776.8) |
Underwriting profit (loss) | (167.3) | (309) |
Interest income | 56.4 | 22.2 |
Dividends | 12.3 | 7.8 |
Investment expenses | (13.1) | (10.7) |
Interest and dividends | 55.6 | 19.3 |
Share of profit of associates | 56.4 | 16.8 |
Operating income (loss) | (55.3) | (272.9) |
Net gains (losses) on investments | (306.5) | 69.7 |
Interest expense | (13.2) | (7.9) |
Corporate overhead and other | (1.4) | (38.4) |
Earnings before income taxes | (376.4) | (249.5) |
Operating segments | Life insurance and Run-off | External | ||
Segmented Information | ||
Gross premiums written | 350.9 | 114.2 |
Net premiums earned | 342.4 | 109.7 |
Operating segments | Life insurance and Run-off | Intercompany | ||
Segmented Information | ||
Gross premiums written | 358.1 | |
Net premiums earned | 358.1 | |
Operating segments | Non-insurance companies | ||
Segmented Information | ||
Interest income | 10.2 | 3.9 |
Dividends | 24.6 | 28.5 |
Investment expenses | (8.2) | (127.1) |
Interest and dividends | 26.6 | (94.7) |
Share of profit of associates | 134 | 22.3 |
Other Revenue | 5,581.6 | 5,157.5 |
Other Expenses | (5,520.9) | (5,092.1) |
Other Revenue (Expenses) | 60.7 | 65.4 |
Operating income (loss) | 221.3 | (7) |
Net gains (losses) on investments | 71.4 | 266 |
Interest expense | (122.8) | (140.3) |
Earnings before income taxes | 169.9 | 118.7 |
Operating segments | Corporate and Other | ||
Segmented Information | ||
Interest income | 11.8 | 28.2 |
Dividends | 0.6 | (0.8) |
Investment expenses | (2.8) | (2.8) |
Interest and dividends | 9.6 | 24.6 |
Share of profit of associates | 102.8 | 38.8 |
Operating income (loss) | 112.4 | 63.4 |
Net gains (losses) on investments | 261.1 | 464.9 |
Gain on sale and consolidation of insurance subsidiaries | 130.5 | |
Interest expense | (257.2) | (305.4) |
Corporate overhead and other | (19.9) | 50 |
Earnings before income taxes | 96.4 | 403.4 |
Eliminations and adjustments | ||
Segmented Information | ||
Gross premiums written | (364) | (655.6) |
Underwriting expenses | 0.5 | 0.3 |
Underwriting profit (loss) | 0.5 | 0.3 |
Interest income | (0.7) | (6.7) |
Investment expenses | 124.6 | 256.6 |
Interest and dividends | 123.9 | 249.9 |
Other Revenue | 0.5 | |
Other Expenses | 5.2 | |
Other Revenue (Expenses) | 5.7 | |
Operating income (loss) | 124.4 | 255.9 |
Interest expense | 0.2 | 1.2 |
Corporate overhead and other | (124.6) | (256.6) |
Earnings before income taxes | 0.5 | |
Eliminations and adjustments | Intercompany | ||
Segmented Information | ||
Gross premiums written | $ (364) | $ (655.6) |
Segmented Information - Underwr
Segmented Information - Underwriting Expenses (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segmented Information | ||
Underwriting expenses - calendar year | $ 20,067.6 | $ 16,065.5 |
Operating segments | Property and Casualty Insurance and Reinsurance | ||
Segmented Information | ||
Loss & LAE - accident year | 13,656.4 | 10,438.5 |
Commissions | 3,432.2 | 2,774.2 |
Other underwriting expenses | 2,666 | 2,431.9 |
Underwriting expenses - accident year | 19,754.6 | 15,644.6 |
Net favourable claims reserve development | (196.2) | (355.6) |
Underwriting expenses - calendar year | 19,558.4 | 15,289 |
Operating segments | Property and Casualty Insurance and Reinsurance | North American Insurers | ||
Segmented Information | ||
Loss & LAE - accident year | 3,733.4 | 2,900.3 |
Commissions | 998.3 | 913.6 |
Other underwriting expenses | 1,020.3 | 927.7 |
Underwriting expenses - accident year | 5,752 | 4,741.6 |
Net favourable claims reserve development | (77.2) | (103.7) |
Underwriting expenses - calendar year | 5,674.8 | 4,637.9 |
Operating segments | Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | ||
Segmented Information | ||
Loss & LAE - accident year | 8,715.7 | 6,551.6 |
Commissions | 2,109.5 | 1,571 |
Other underwriting expenses | 1,263.8 | 1,156.4 |
Underwriting expenses - accident year | 12,089 | 9,279 |
Net favourable claims reserve development | (21.1) | (201.4) |
Underwriting expenses - calendar year | 12,067.9 | 9,077.6 |
Operating segments | Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | ||
Segmented Information | ||
Loss & LAE - accident year | 1,207.3 | 986.6 |
Commissions | 324.4 | 289.6 |
Other underwriting expenses | 381.9 | 347.8 |
Underwriting expenses - accident year | 1,913.6 | 1,624 |
Net favourable claims reserve development | (97.9) | (50.5) |
Underwriting expenses - calendar year | 1,815.7 | 1,573.5 |
Eliminations and adjustments | ||
Segmented Information | ||
Underwriting expenses - calendar year | $ (0.5) | $ (0.3) |
Segmented Information - Investm
Segmented Information - Investments In Associates, Additions to goodwill, Segment assets and liabilities (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segmented Information | ||
Investments in associates | $ 7,433.9 | $ 6,104 |
Additions to goodwill | 152 | 60.7 |
Segment assets | 92,125.1 | 86,645.4 |
Segment liabilities | 71,789.3 | 65,330.1 |
Operating segments | Property and Casualty Insurance and Reinsurance | ||
Segmented Information | ||
Investments in associates | 4,703 | 3,385.4 |
Additions to goodwill | 16.4 | |
Segment assets | 79,847 | 73,884.9 |
Segment liabilities | 57,608.7 | 51,518.9 |
Operating segments | Property and Casualty Insurance and Reinsurance | North American Insurers | ||
Segmented Information | ||
Investments in associates | 1,217.7 | 801.5 |
Segment assets | 18,664.9 | 17,418.7 |
Segment liabilities | 12,890 | 11,551.5 |
Operating segments | Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | ||
Segmented Information | ||
Investments in associates | 2,893.3 | 2,168.7 |
Additions to goodwill | 16.4 | |
Segment assets | 51,634.9 | 46,849.3 |
Segment liabilities | 39,086.8 | 34,266.7 |
Operating segments | Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | ||
Segmented Information | ||
Investments in associates | 592 | 415.2 |
Segment assets | 9,547.2 | 9,616.9 |
Segment liabilities | 5,631.9 | 5,700.7 |
Operating segments | Life insurance and Run-off | ||
Segmented Information | ||
Investments in associates | 348.1 | 272.6 |
Additions to goodwill | 0.4 | |
Segment assets | 6,087.7 | 6,669.1 |
Segment liabilities | 5,289.5 | 5,781.1 |
Operating segments | Non-insurance companies | ||
Segmented Information | ||
Investments in associates | 1,378.5 | 1,379.7 |
Additions to goodwill | 151.6 | 44.3 |
Segment assets | 8,611.4 | 7,856.4 |
Segment liabilities | 4,820.6 | 4,075.1 |
Corporate and Other and eliminations and adjustments | ||
Segmented Information | ||
Investments in associates | 1,004.3 | 1,066.3 |
Segment assets | (2,421) | (1,765) |
Segment liabilities | $ 4,070.5 | $ 3,955 |
Segmented Information - Product
Segmented Information - Product Line (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segmented Information | ||
Net premiums earned | $ 21,006.1 | $ 16,558 |
Interest and dividends | 961.8 | 640.8 |
Share of profit of associates | 1,014.7 | 402 |
Net gains (losses) on investments | (1,733.9) | 3,445.1 |
Gain on sale and consolidation of insurance subsidiaries | 1,219.7 | 264 |
Other revenue | 5,581.6 | 5,158 |
Income | $ 28,050 | $ 26,467.9 |
Product Concentration | Net Premiums Earned | ||
Segmented Information | ||
Distribution of net premiums earned | 100% | 100% |
Property | ||
Segmented Information | ||
Net premiums earned | $ 7,194.7 | $ 5,929.6 |
Property | Product Concentration | Net Premiums Earned | ||
Segmented Information | ||
Distribution of net premiums earned | 34.30% | 35.80% |
Casualty | ||
Segmented Information | ||
Net premiums earned | $ 11,766.1 | $ 9,150.1 |
Casualty | Product Concentration | Net Premiums Earned | ||
Segmented Information | ||
Distribution of net premiums earned | 56% | 55.30% |
Specialty | ||
Segmented Information | ||
Net premiums earned | $ 2,045.3 | $ 1,478.3 |
Specialty | Product Concentration | Net Premiums Earned | ||
Segmented Information | ||
Distribution of net premiums earned | 9.70% | 8.90% |
Property and Casualty Insurance and Reinsurance | ||
Segmented Information | ||
Net premiums earned | $ 20,663.7 | $ 16,090.2 |
Property and Casualty Insurance and Reinsurance | Property | ||
Segmented Information | ||
Net premiums earned | 7,194.7 | 5,921.4 |
Property and Casualty Insurance and Reinsurance | Casualty | ||
Segmented Information | ||
Net premiums earned | 11,765.6 | 8,801.3 |
Property and Casualty Insurance and Reinsurance | Specialty | ||
Segmented Information | ||
Net premiums earned | 1,703.4 | 1,367.5 |
Property and Casualty Insurance and Reinsurance | North American Insurers | ||
Segmented Information | ||
Net premiums earned | 6,107.8 | 5,024.8 |
Property and Casualty Insurance and Reinsurance | North American Insurers | Property | ||
Segmented Information | ||
Net premiums earned | 1,379.3 | 1,209.6 |
Property and Casualty Insurance and Reinsurance | North American Insurers | Casualty | ||
Segmented Information | ||
Net premiums earned | 4,284.3 | 3,400.2 |
Property and Casualty Insurance and Reinsurance | North American Insurers | Specialty | ||
Segmented Information | ||
Net premiums earned | 444.2 | 415 |
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | ||
Segmented Information | ||
Net premiums earned | 12,726.9 | 9,451.8 |
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | Property | ||
Segmented Information | ||
Net premiums earned | 4,895.5 | 3,876.9 |
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | Casualty | ||
Segmented Information | ||
Net premiums earned | 6,866.2 | 4,856.8 |
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | Specialty | ||
Segmented Information | ||
Net premiums earned | 965.2 | 718.1 |
Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | ||
Segmented Information | ||
Net premiums earned | 1,829 | 1,613.6 |
Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | Property | ||
Segmented Information | ||
Net premiums earned | 919.9 | 834.9 |
Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | Casualty | ||
Segmented Information | ||
Net premiums earned | 615.1 | 544.3 |
Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | Specialty | ||
Segmented Information | ||
Net premiums earned | 294 | 234.4 |
Life insurance and Run-off | ||
Segmented Information | ||
Net premiums earned | 342.4 | 467.8 |
Life insurance and Run-off | Property | ||
Segmented Information | ||
Net premiums earned | 8.2 | |
Life insurance and Run-off | Casualty | ||
Segmented Information | ||
Net premiums earned | 0.5 | 348.8 |
Life insurance and Run-off | Specialty | ||
Segmented Information | ||
Net premiums earned | $ 341.9 | $ 110.8 |
Segmented Information - Geograp
Segmented Information - Geographic Region (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segmented Information | ||
Net premiums earned | $ 21,006.1 | $ 16,558 |
Interest and dividends | 961.8 | 640.8 |
Share of profit of associates | 1,014.7 | 402 |
Net gains (losses) on investments | (1,733.9) | 3,445.1 |
Gain on sale and consolidation of insurance subsidiaries | 1,219.7 | 264 |
Other revenue | 5,581.6 | 5,158 |
Income | $ 28,050 | $ 26,467.9 |
Geographic | ||
Segmented Information | ||
Distribution of net premiums earned | 100% | 100% |
Canada | ||
Segmented Information | ||
Net premiums earned | $ 2,293.5 | $ 2,078.2 |
Canada | Geographic | ||
Segmented Information | ||
Distribution of net premiums earned | 10.90% | 12.60% |
United States | ||
Segmented Information | ||
Net premiums earned | $ 13,617.7 | $ 10,333.4 |
United States | Geographic | ||
Segmented Information | ||
Distribution of net premiums earned | 64.90% | 62.40% |
Asia | ||
Segmented Information | ||
Net premiums earned | $ 1,431.4 | $ 1,247 |
Asia | Geographic | ||
Segmented Information | ||
Distribution of net premiums earned | 6.80% | 7.50% |
International | ||
Segmented Information | ||
Net premiums earned | $ 3,663.5 | $ 2,899.4 |
International | Geographic | ||
Segmented Information | ||
Distribution of net premiums earned | 17.40% | 17.50% |
Property and Casualty Insurance and Reinsurance | ||
Segmented Information | ||
Net premiums earned | $ 20,663.7 | $ 16,090.2 |
Property and Casualty Insurance and Reinsurance | Canada | ||
Segmented Information | ||
Net premiums earned | 2,293.5 | 2,078.2 |
Property and Casualty Insurance and Reinsurance | United States | ||
Segmented Information | ||
Net premiums earned | 13,617.2 | 9,975.3 |
Gain on sale and consolidation of insurance subsidiaries | 1,213.2 | |
Property and Casualty Insurance and Reinsurance | Asia | ||
Segmented Information | ||
Net premiums earned | 1,431.4 | 1,247 |
Property and Casualty Insurance and Reinsurance | International | ||
Segmented Information | ||
Net premiums earned | 3,321.6 | 2,789.7 |
Property and Casualty Insurance and Reinsurance | North American Insurers | ||
Segmented Information | ||
Net premiums earned | 6,107.8 | 5,024.8 |
Property and Casualty Insurance and Reinsurance | North American Insurers | Canada | ||
Segmented Information | ||
Net premiums earned | 1,914.1 | 1,784.9 |
Property and Casualty Insurance and Reinsurance | North American Insurers | United States | ||
Segmented Information | ||
Net premiums earned | 4,157.5 | 3,222.1 |
Property and Casualty Insurance and Reinsurance | North American Insurers | Asia | ||
Segmented Information | ||
Net premiums earned | 1.4 | 1.2 |
Property and Casualty Insurance and Reinsurance | North American Insurers | International | ||
Segmented Information | ||
Net premiums earned | 34.8 | 16.6 |
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | ||
Segmented Information | ||
Net premiums earned | 12,726.9 | 9,451.8 |
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | Canada | ||
Segmented Information | ||
Net premiums earned | 378.8 | 293.1 |
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | United States | ||
Segmented Information | ||
Net premiums earned | 9,337.3 | 6,671.4 |
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | Asia | ||
Segmented Information | ||
Net premiums earned | 878.1 | 806.9 |
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | International | ||
Segmented Information | ||
Net premiums earned | 2,132.7 | 1,680.4 |
Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | ||
Segmented Information | ||
Net premiums earned | 1,829 | 1,613.6 |
Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | Canada | ||
Segmented Information | ||
Net premiums earned | 0.6 | 0.2 |
Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | United States | ||
Segmented Information | ||
Net premiums earned | 122.4 | 81.8 |
Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | Asia | ||
Segmented Information | ||
Net premiums earned | 551.9 | 438.9 |
Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | International | ||
Segmented Information | ||
Net premiums earned | 1,154.1 | 1,092.7 |
Life insurance and Run-off | ||
Segmented Information | ||
Net premiums earned | 342.4 | 467.8 |
Life insurance and Run-off | United States | ||
Segmented Information | ||
Net premiums earned | 0.5 | 358.1 |
Life insurance and Run-off | International | ||
Segmented Information | ||
Net premiums earned | $ 341.9 | $ 109.7 |
Segmented Information - Non-ins
Segmented Information - Non-insurance companies (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segmented Information | ||
Revenue | $ 5,581.6 | $ 5,158 |
Interest and dividends | 961.8 | 640.8 |
Share of profit (loss) of associates | 1,014.7 | 402 |
Other | Farmers Edge | ||
Segmented Information | ||
Non-cash goodwill impairment charge | 133.4 | |
Non-insurance companies | ||
Segmented Information | ||
Revenue | 5,581.6 | 5,157.5 |
Expenses | (5,520.9) | (5,092.1) |
Pre-tax income (loss) before interest expense and other | 60.7 | 65.4 |
Interest and dividends | 26.6 | (94.7) |
Share of profit (loss) of associates | 134 | 22.3 |
Operating income (loss) | 221.3 | (7) |
Non-insurance companies | Restaurants and retail | ||
Segmented Information | ||
Revenue | 1,710.3 | 1,803.8 |
Expenses | (1,582.2) | (1,724.8) |
Pre-tax income (loss) before interest expense and other | 128.1 | 79 |
Interest and dividends | 9.9 | 7.5 |
Share of profit (loss) of associates | (0.1) | |
Operating income (loss) | 137.9 | 86.5 |
Non-insurance companies | Fairfax India | ||
Segmented Information | ||
Revenue | 216.7 | 228.2 |
Expenses | (208.1) | (206.9) |
Pre-tax income (loss) before interest expense and other | 8.6 | 21.3 |
Interest and dividends | 21.4 | (102.2) |
Share of profit (loss) of associates | 132 | 20.2 |
Operating income (loss) | 162 | (60.7) |
Non-insurance companies | Thomas Cook India | ||
Segmented Information | ||
Revenue | 611 | 249.4 |
Expenses | (600.8) | (293.4) |
Pre-tax income (loss) before interest expense and other | 10.2 | (44) |
Interest and dividends | (0.1) | |
Share of profit (loss) of associates | 0.3 | (0.1) |
Operating income (loss) | 10.5 | (44.2) |
Non-insurance companies | Other | ||
Segmented Information | ||
Revenue | 3,043.6 | 2,876.1 |
Expenses | (3,129.8) | (2,867) |
Pre-tax income (loss) before interest expense and other | (86.2) | 9.1 |
Interest and dividends | (4.7) | 0.1 |
Share of profit (loss) of associates | 1.8 | 2.2 |
Operating income (loss) | $ (89.1) | $ 11.4 |
Segmented Information - Segment
Segmented Information - Segmented Balance Sheet (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Segmented Information | |||
Holding company cash and investments | $ 1,345.8 | $ 1,478.3 | |
Insurance contract receivables | 7,907.5 | 6,883.2 | |
Portfolio investments | 54,322.9 | 51,697.4 | |
Deferred premium acquisition costs | 2,170.3 | 1,924.1 | $ 1,543.7 |
Recoverable from reinsurers | 13,115.8 | 12,090.5 | 10,533.2 |
Deferred income tax assets | 492.1 | 522.4 | |
Goodwill and intangible assets | 5,689 | 5,928.2 | 6,229.1 |
Other assets | 7,081.7 | 6,121.3 | |
Total assets | 92,125.1 | 86,645.4 | |
Accounts payable and accrued liabilities | 5,215.2 | 4,985.4 | |
Derivative obligations | 191 | 152.9 | |
Deferred income tax liabilities | 496.7 | 598.8 | |
Insurance contract payables | 5,061.9 | 4,493.5 | |
Provision for losses and loss adjustment expenses | 40,489.6 | 36,892.3 | |
Provision for unearned premiums | 11,710 | 10,454.2 | |
Borrowings | 8,624.9 | 7,753 | 8,814 |
Total liabilities | 71,789.3 | 65,330.1 | |
Shareholders' equity attributable to shareholders of Fairfax | 16,676.2 | 16,385.1 | |
Non-controlling interests | 3,659.6 | 4,930.2 | |
Total equity | 20,335.8 | 21,315.3 | $ 17,527.3 |
Total liabilities and total equity | 92,125.1 | 86,645.4 | |
Non-insurance companies | |||
Segmented Information | |||
Non-controlling interests | 1,690.4 | 1,998.8 | |
Operating segments | Property and Casualty Insurance and Reinsurance | |||
Segmented Information | |||
Holding company cash and investments | 316.6 | 604.5 | |
Insurance contract receivables | 8,310.9 | 7,215.5 | |
Portfolio investments | 49,038.8 | 45,061.8 | |
Deferred premium acquisition costs | 2,201.3 | 1,950.6 | |
Recoverable from reinsurers | 14,097.9 | 13,060.3 | |
Deferred income tax assets | 337.3 | 268.2 | |
Goodwill and intangible assets | 3,396.8 | 3,579.5 | |
Due from affiliates | 206.3 | 231.3 | |
Other assets | 1,774 | 1,746 | |
Investments in affiliates | 167.1 | 167.2 | |
Total assets | 79,847 | 73,884.9 | |
Accounts payable and accrued liabilities | 2,304.9 | 2,149.9 | |
Derivative obligations | 113.5 | 72.5 | |
Due to affiliates | 16.5 | 28.8 | |
Deferred income tax liabilities | 225 | 322.2 | |
Insurance contract payables | 4,839.7 | 4,208.6 | |
Provision for losses and loss adjustment expenses | 37,531.7 | 33,381.4 | |
Provision for unearned premiums | 11,844 | 10,564.8 | |
Borrowings | 733.4 | 790.7 | |
Total liabilities | 57,608.7 | 51,518.9 | |
Shareholders' equity attributable to shareholders of Fairfax | 20,269.1 | 19,778.9 | |
Non-controlling interests | 1,969.2 | 2,587.1 | |
Total equity | 22,238.3 | 22,366 | |
Total liabilities and total equity | 79,847 | 73,884.9 | |
Operating segments | Life insurance and Run-off | |||
Segmented Information | |||
Insurance contract receivables | 28.2 | 7.8 | |
Portfolio investments | 4,275.4 | 4,963.9 | |
Deferred premium acquisition costs | 7.5 | 3.8 | |
Recoverable from reinsurers | 517.5 | 457.6 | |
Deferred income tax assets | 25.6 | 29 | |
Goodwill and intangible assets | 7.5 | 7.5 | |
Due from affiliates | 364.1 | 360.2 | |
Other assets | 832.6 | 810 | |
Investments in affiliates | 29.3 | 29.3 | |
Total assets | 6,087.7 | 6,669.1 | |
Accounts payable and accrued liabilities | 263.1 | 233.4 | |
Due to affiliates | 0.4 | 0.2 | |
Deferred income tax liabilities | 18.5 | 72.9 | |
Insurance contract payables | 688.4 | 652 | |
Provision for losses and loss adjustment expenses | 4,300.9 | 4,806.1 | |
Provision for unearned premiums | 18.2 | 16.5 | |
Total liabilities | 5,289.5 | 5,781.1 | |
Shareholders' equity attributable to shareholders of Fairfax | 798.2 | 888 | |
Total equity | 798.2 | 888 | |
Total liabilities and total equity | 6,087.7 | 6,669.1 | |
Operating segments | Non-insurance companies | |||
Segmented Information | |||
Portfolio investments | 2,119.3 | 2,252.8 | |
Deferred income tax assets | 54.5 | 66.9 | |
Goodwill and intangible assets | 2,284.4 | 2,341.2 | |
Other assets | 4,153.2 | 3,195.5 | |
Total assets | 8,611.4 | 7,856.4 | |
Accounts payable and accrued liabilities | 2,430.7 | 2,077.4 | |
Derivative obligations | 58.2 | 47.9 | |
Due to affiliates | 82.4 | 135.1 | |
Deferred income tax liabilities | 252.4 | 198.5 | |
Borrowings | 1,996.9 | 1,616.2 | |
Total liabilities | 4,820.6 | 4,075.1 | |
Shareholders' equity attributable to shareholders of Fairfax | 2,100.4 | 1,782.5 | |
Non-controlling interests | 1,690.4 | 1,998.8 | |
Total equity | 3,790.8 | 3,781.3 | |
Total liabilities and total equity | 8,611.4 | 7,856.4 | |
Corporate and Other and eliminations and adjustments | |||
Segmented Information | |||
Holding company cash and investments | 1,029.2 | 873.8 | |
Insurance contract receivables | (431.6) | (340.1) | |
Portfolio investments | (1,110.6) | (581.1) | |
Deferred premium acquisition costs | (38.5) | (30.3) | |
Recoverable from reinsurers | (1,499.6) | (1,427.4) | |
Deferred income tax assets | 74.7 | 158.3 | |
Goodwill and intangible assets | 0.3 | ||
Due from affiliates | (570.4) | (591.5) | |
Other assets | 321.9 | 369.8 | |
Investments in affiliates | (196.4) | (196.5) | |
Total assets | (2,421) | (1,765) | |
Accounts payable and accrued liabilities | 216.5 | 524.7 | |
Derivative obligations | 19.3 | 32.5 | |
Due to affiliates | (99.3) | (164.1) | |
Deferred income tax liabilities | 0.8 | 5.2 | |
Insurance contract payables | (466.2) | (367.1) | |
Provision for losses and loss adjustment expenses | (1,343) | (1,295.2) | |
Provision for unearned premiums | (152.2) | (127.1) | |
Borrowings | 5,894.6 | 5,346.1 | |
Total liabilities | 4,070.5 | 3,955 | |
Shareholders' equity attributable to shareholders of Fairfax | (6,491.5) | (6,064.3) | |
Non-controlling interests | 344.3 | ||
Total equity | (6,491.5) | (5,720) | |
Total liabilities and total equity | $ (2,421) | $ (1,765) |
Expenses (Details)
Expenses (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Expenses | ||
Losses and loss adjustment expenses, property and casualty | $ 13,169.1 | $ 10,272.9 |
Provisions and claims, Eurolife | 251.1 | 81 |
Cost of sales | 3,349.4 | 2,987.5 |
Wages and salaries | 2,458.3 | 2,308.4 |
Depreciation, amortization and impairment charges | 683.6 | 930.4 |
Employee benefits | 507.2 | 462.2 |
Premium taxes | 306.8 | 285.9 |
Information technology costs | 299.2 | 257 |
Audit, legal and tax professional fees | 242.8 | 203.1 |
Repairs, maintenance and utilities | 178.3 | 157.4 |
Shipping and delivery | 154.1 | 121.2 |
Share-based payments to directors and employees | 151.9 | 136.5 |
Marketing costs | 115.5 | 103.5 |
Administrative expense and other | 563 | 466.5 |
Losses on claims, net, operating expenses and other expenses | 22,430.3 | 18,773.5 |
Commissions, net | 3,454.9 | 2,787.9 |
Interest expense | 452.8 | 513.9 |
Expenses | 26,338 | 22,075.3 |
Insurance and reinsurance companies | ||
Expenses | ||
Losses and loss adjustment expenses, property and casualty | 13,169.1 | 10,272.9 |
Provisions and claims, Eurolife | 251.1 | 81 |
Wages and salaries | 1,580.8 | 1,547.1 |
Depreciation, amortization and impairment charges | 233.2 | 291 |
Employee benefits | 381.3 | 345.3 |
Premium taxes | 306.8 | 285.9 |
Information technology costs | 254.7 | 216.3 |
Audit, legal and tax professional fees | 189.1 | 159.7 |
Repairs, maintenance and utilities | 14.4 | 13.2 |
Shipping and delivery | 1.3 | 1.2 |
Share-based payments to directors and employees | 131.5 | 118.2 |
Marketing costs | 38.9 | 33.4 |
Administrative expense and other | 357.2 | 321.4 |
Losses on claims, net, operating expenses and other expenses | 16,909.4 | 13,686.6 |
Commissions, net | 3,454.9 | 2,787.9 |
Interest expense | 330 | 373.6 |
Expenses | 20,694.3 | 16,848.1 |
Non-insurance companies | ||
Expenses | ||
Cost of sales | 3,349.4 | 2,987.5 |
Wages and salaries | 877.5 | 761.3 |
Depreciation, amortization and impairment charges | 450.4 | 639.4 |
Employee benefits | 125.9 | 116.9 |
Information technology costs | 44.5 | 40.7 |
Audit, legal and tax professional fees | 53.7 | 43.4 |
Repairs, maintenance and utilities | 163.9 | 144.2 |
Shipping and delivery | 152.8 | 120 |
Share-based payments to directors and employees | 20.4 | 18.3 |
Marketing costs | 76.6 | 70.1 |
Administrative expense and other | 205.8 | 145.1 |
Losses on claims, net, operating expenses and other expenses | 5,520.9 | 5,086.9 |
Interest expense | 122.8 | 140.3 |
Expenses | $ 5,643.7 | $ 5,227.2 |
Supplementary Cash Flow Infor_3
Supplementary Cash Flow Information - Supplemental Balance Sheet Information (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Total | $ 6,119.6 | $ 11,685.4 | $ 4,467.1 |
Restricted cash and cash equivalents | |||
Total | 861.2 | 1,261 | |
Cash | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Cash | 3,350.5 | 5,424.2 | |
Restricted cash and cash equivalents | |||
Cash | 501.6 | 486.2 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Cash | 3,852.1 | 5,910.4 | |
Cash | Holding company cash and investments | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Cash | 72.7 | 129.9 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Cash | 72.7 | 129.9 | |
Cash | Subsidiary cash and short term investments | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Cash | 3,243.3 | 5,259.2 | |
Restricted cash and cash equivalents | |||
Cash | 500.8 | 484.6 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Cash | 3,744.1 | 5,743.8 | |
Cash | Fairfax India | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Cash | 34.5 | 35.1 | |
Restricted cash and cash equivalents | |||
Cash | 0.8 | 1.6 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Cash | 35.3 | 36.7 | |
Cash equivalents | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Cash equivalents | 2,769.1 | 6,261.2 | |
Restricted cash and cash equivalents | |||
Cash equivalents | 359.6 | 774.8 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Cash equivalents | 3,128.7 | 7,036 | |
Cash equivalents | Holding company cash and investments | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Cash equivalents | 479.4 | 336 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Cash equivalents | 479.4 | 336 | |
Cash equivalents | Holding company assets pledged for derivative obligations | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Cash equivalents | 40.6 | 46.8 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Cash equivalents | 40.6 | 46.8 | |
Cash equivalents | Subsidiary cash and short term investments | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Cash equivalents | 2,105.6 | 5,777.6 | |
Restricted cash and cash equivalents | |||
Cash equivalents | 353.6 | 761.8 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Cash equivalents | 2,459.2 | 6,539.4 | |
Cash equivalents | Subsidiary assets pledged for derivative obligations | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Cash equivalents | 74 | ||
Cash and cash equivalents included on the consolidated balance sheet | |||
Cash equivalents | 74 | ||
Cash equivalents | Fairfax India | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Cash equivalents | 143.5 | 26.8 | |
Restricted cash and cash equivalents | |||
Cash equivalents | 6 | 13 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Cash equivalents | 149.5 | 39.8 | |
Cash and cash equivalents | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Total | 6,119.6 | 11,685.4 | |
Restricted cash and cash equivalents | |||
Total | 861.2 | 1,261 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Total | 6,980.8 | 12,946.4 | |
Cash and cash equivalents | Holding company cash and investments | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Total | 552.1 | 465.9 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Total | 552.1 | 465.9 | |
Cash and cash equivalents | Holding company assets pledged for derivative obligations | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Total | 40.6 | 46.8 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Total | 40.6 | 46.8 | |
Cash and cash equivalents | Subsidiary cash and short term investments | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Total | 5,348.9 | 11,036.8 | |
Restricted cash and cash equivalents | |||
Total | 854.4 | 1,246.4 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Total | 6,203.3 | 12,283.2 | |
Cash and cash equivalents | Subsidiary assets pledged for derivative obligations | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Total | 74 | ||
Cash and cash equivalents included on the consolidated balance sheet | |||
Total | 74 | ||
Cash and cash equivalents | Fairfax India | |||
Unrestricted cash and cash equivalents included in the consolidated statement of cash flows | |||
Total | 178 | 61.9 | |
Restricted cash and cash equivalents | |||
Total | 6.8 | 14.6 | |
Cash and cash equivalents included on the consolidated balance sheet | |||
Total | $ 184.8 | $ 76.5 |
Supplementary Cash Flow Infor_4
Supplementary Cash Flow Information - Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Net (purchases) sales of investments classified at FVTPL | ||
Short term investments | $ 6,352.5 | $ (767.1) |
Bonds | (16,016.2) | 2,545.7 |
Preferred stocks | (293.2) | (37.3) |
Common stocks | (63.6) | 477.2 |
Net derivatives and other invested assets | 380.3 | 395.9 |
Net (purchases) sales of securities classified at FVTPL | (9,640.2) | 2,614.4 |
Changes in operating assets and liabilities | ||
Net decrease (increase) in restricted cash and cash equivalents | 393.7 | (472.6) |
Provision for losses and loss adjustment expenses | 4,530.1 | 3,692 |
Provision for unearned premiums | 1,455.3 | 2,152.2 |
Provision for life policy benefits | (142.4) | (167.9) |
Insurance contract receivables | (1,134.9) | (1,152.9) |
Insurance contract payables | 625.8 | 1,079.8 |
Recoverable from reinsurers | (1,257.9) | (1,580) |
Other receivables | (349.8) | (96.7) |
Accounts payable and accrued liabilities | 338.2 | 291.1 |
Other | (638) | (758.1) |
Changes in operating assets and liabilities | (3,820.1) | (2,986.9) |
Net interest and dividends received | ||
Interest and dividends received | 1,030.8 | 865.7 |
Interest paid on borrowings | (360.5) | (366.7) |
Interest paid on lease liabilities | (48.1) | (54.8) |
Net interest and dividends received | 622.2 | 444.2 |
Net income taxes paid | $ (416.4) | $ (288.7) |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Thomas Cook India | ||
Related Party Transactions | ||
Increase in ownership percentage through conversion of shares | 6.60% | |
Key management team | ||
Related Party Transactions | ||
Salaries and other short-term employee benefits | $ 10.2 | $ 10.8 |
Share-based payments | 5.7 | 4.7 |
Related party compensation | 15.9 | 15.5 |
Board of Directors | ||
Related Party Transactions | ||
Retainers and fees | 1.7 | 1.5 |
Share-based payments | 0.3 | 0.4 |
Related party compensation | 2 | $ 1.9 |
Fairfax India Holdings Corporation (Fairfax India) | ||
Related Party Transactions | ||
Amounts receivable, related party transactions | $ 41.5 |
Subsidiaries (Details)
Subsidiaries (Details) | 12 Months Ended | ||
Sep. 27, 2022 | Sep. 26, 2022 | Dec. 31, 2022 | |
Allied World Assurance Company Holdings, Ltd (Allied World) | |||
Subsidiaries | |||
Equity ownership percentage | 82.90% | 70.90% | |
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | Odyssey Group Holdings, Inc. (Odyssey Group) | |||
Subsidiaries | |||
Equity ownership percentage | 90% | ||
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | Brit Limited (Brit) | |||
Subsidiaries | |||
Equity ownership percentage | 86.20% | ||
Property and Casualty Insurance and Reinsurance | Global Insurers and Reinsurers | Allied World Assurance Company Holdings, Ltd (Allied World) | |||
Subsidiaries | |||
Equity ownership percentage | 82.90% | ||
Property and Casualty Insurance and Reinsurance | International Insurers and Reinsurers | Eurolife FFH General Insurance Single Member S.A. (Eurolife General) | |||
Subsidiaries | |||
Equity ownership percentage | 80% | ||
Property and Casualty Insurance and Reinsurance | Fairfax Central and Eastern Europe | FFH Ukraine Holdings (Fairfax Ukraine) | |||
Subsidiaries | |||
Equity ownership percentage | 70% | ||
Property and Casualty Insurance and Reinsurance | Fairfax Asia | The Pacific Insurance Berhad (Pacific Insurance) | |||
Subsidiaries | |||
Equity ownership percentage | 85% | ||
Property and Casualty Insurance and Reinsurance | Fairfax Asia | PT Asuransi Multi Artha Guna Tbk (AMAG Insurance) | |||
Subsidiaries | |||
Equity ownership percentage | 80.30% | ||
Property and Casualty Insurance and Reinsurance | Fairfax Asia | Fairfirst Insurance Limited (Fairfirst Insurance) | |||
Subsidiaries | |||
Equity ownership percentage | 78% | ||
Life insurance and Run-off | Eurolife FFH Life Insurance Group Holdings S.A. (Eurolife) | |||
Subsidiaries | |||
Equity ownership percentage | 80% | ||
Non-insurance companies | Restaurants and retail | Recipe Unlimited Corporation (Recipe) | |||
Subsidiaries | |||
Equity ownership percentage | 75.70% | ||
Non-insurance companies | Restaurants and retail | Sporting Life Group Limited | |||
Subsidiaries | |||
Equity ownership percentage | 88.50% | ||
Non-insurance companies | Fairfax India | Fairfax India Holdings Corporation (Fairfax India) | |||
Subsidiaries | |||
Equity ownership percentage | 34.70% | ||
Proportion of voting rights held | 94.40% | ||
Non-insurance companies | Thomas Cook India | Thomas Cook (India) Limited (Thomas Cook India) | |||
Subsidiaries | |||
Equity ownership percentage | 73.30% | ||
Non-insurance companies | Other | AGT Food and Ingredients Inc. (AGT) | |||
Subsidiaries | |||
Equity ownership percentage | 59.60% | ||
Non-insurance companies | Other | Dexterra Group Inc. (Dexterra Group) | |||
Subsidiaries | |||
Equity ownership percentage | 48.70% | ||
Non-insurance companies | Other | Boat Rocker Media Inc. (Boat Rocker) | |||
Subsidiaries | |||
Equity ownership percentage | 44.90% | ||
Proportion of voting rights held | 56.10% | ||
Non-insurance companies | Other | Farmers Edge Inc. (Farmers Edge) | |||
Subsidiaries | |||
Equity ownership percentage | 61.30% | ||
Non-insurance companies | Other | Grivalia Hospitality | |||
Subsidiaries | |||
Equity ownership percentage | 78.40% | ||
Sporting Life Group Limited | Sporting Life Inc. (Sporting Life) | |||
Subsidiaries | |||
Equity ownership percentage | 88.50% | ||
Proportion of voting rights held | 100% | ||
Sporting Life Group Limited | Golf Town Limited (Golf Town) | |||
Subsidiaries | |||
Equity ownership percentage | 88.50% | ||
Proportion of voting rights held | 100% | ||
Thomas Cook (India) Limited (Thomas Cook India) | Sterling Holiday Resorts Limited (Sterling Resorts) | |||
Subsidiaries | |||
Equity ownership percentage | 73.30% | ||
Proportion of voting rights held | 100% |