Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2018	Nov. 01, 2018
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q3
Trading Symbol	ARGO
Entity Registrant Name	Argo Group International Holdings, Ltd.
Entity Central Index Key	0001091748
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		33,891,236

Condensed Consolidated Balance Sheets - USD ($)
$ in Millions

Sep. 30, 2018

Dec. 31, 2017

^[1]

Investments:

Fixed maturities available-for-sale, at fair value (cost: 2018 - $3,496.5; 2017 - $3,320.6)

$ 3,456.2

$ 3,343.4

Equity securities, at fair value (cost: 2018 - $358.6; 2017 - $338.2)

486.5

487.4

Other investments (cost: 2018 - $477.8; 2017 - $534.1)

487.5

543.6

Short-term investments, at fair value (cost: 2018 - $434.5; 2017 - $368.5)

434.5

368.5

Total investments

4,864.7

4,742.9

Cash

118.5

176.6

Accrued investment income

26.3

23.5

Premiums receivable

708.9

598.6

Reinsurance recoverables

2,208.2

2,093.3

Goodwill

161.4

Intangible assets, net of accumulated amortization

110.5

96.8

Current income taxes receivable, net

0.0

1.4

Deferred acquisition costs, net

174.6

160.4

Ceded unearned premiums

515.6

399.5

Other assets

391.0

309.6

Total assets

9,279.7

8,764.0

Liabilities and Shareholders' Equity

Reserves for losses and loss adjustment expenses

4,291.7

4,201.0

Unearned premiums

1,387.5

1,207.7

Accrued underwriting expenses

122.6

115.3

Ceded reinsurance payable, net

885.4

734.0

Funds held

38.8

42.7

Senior unsecured fixed rate notes

139.8

139.6

Other indebtedness

183.9

184.5

Junior subordinated debentures

256.9

256.6

Current income taxes payable, net

8.1

0.0

Deferred tax liabilities, net

14.0

31.3

Other liabilities

132.9

31.6

Total liabilities

7,461.6

6,944.3

Commitments and contingencies (Note 14)

Shareholders' equity:

Common shares - $1.00 par, 500,000,000 shares authorized; 45,188,722 and 40,385,309 shares issued at September 30, 2018 and December 31, 2017, respectively

45.2

40.4

Additional paid-in capital

1,368.7

1,129.1

Treasury shares (11,285,996 and 10,785,007 shares at September 30, 2018 and December 31, 2017, respectively)

(453.4)

(423.4)

Retained earnings

915.7

977.0

Accumulated other comprehensive (loss) income, net of taxes

(58.1)

96.6

Total shareholders' equity

1,818.1

1,819.7

Total liabilities and shareholders' equity

$ 9,279.7

$ 8,764.0

[1]	Derived from audited consolidated financial statements.

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Fixed maturities available-for-sale, cost	$ 3,496.5	$ 3,320.6
Equity securities, cost	358.6	338.2
Other investments, cost	477.8	534.1
Short-term investments, cost	$ 434.5	$ 368.5
Common shares, par value (in dollars per share)	$ 1.00	$ 1.00
Common shares, shares authorized (in shares)	500,000,000	500,000,000
Common shares, shares issued (in shares)	45,188,722	40,385,309
Treasury shares (in shares)	11,285,996	10,785,007

Condensed Consolidated Statements of Income (Loss) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Premiums and other revenue:
Earned premiums	$ 446.9	$ 389.3	$ 1,279.3	$ 1,167.8
Net investment income	34.5	30.9	103.7	105.0
Fee and other income	3.3	13.0	7.2	20.4
Net realized investment gains (losses):
Net realized investment gains	9.7	6.0	31.1	25.1
Change in fair value of equity securities	4.5	0.0	(22.1)	0.0
Net realized investment gains	14.2	6.0	9.0	25.1
Total revenue	498.9	439.2	1,399.2	1,318.3
Expenses:
Losses and loss adjustment expenses	277.5	326.4	760.2	779.5
Underwriting, acquisition and insurance expenses	168.0	166.1	485.0	474.4
Interest expense	7.9	7.5	23.4	20.4
Fee and other expense	1.9	5.0	5.5	12.4
Foreign currency exchange (gains) losses	(1.7)	0.1	(2.3)	4.0
Total expenses	453.6	505.1	1,271.8	1,290.7
Income (loss) before income taxes	45.3	(65.9)	127.4	27.6
Income tax provision (benefit)	4.7	(4.6)	20.2	6.2
Net income (loss)	$ 40.6	$ (61.3)	$ 107.2	$ 21.4
Net income (loss) per common share:
Basic (in dollars per share)	$ 1.20	$ (1.78)	$ 3.16	$ 0.62
Diluted (in dollars per share)	1.17	(1.78)	3.09	0.60
Dividend declared per common share (in dollars per share)	$ 0.27	$ 0.23	$ 0.81	$ 0.70
Weighted average common shares:
Basic (in shares)	33,956,695	34,475,452	33,921,632	34,586,931
Diluted (in shares)	34,656,328	34,475,452	34,688,843	35,527,173
Net realized investment gains before other-than-temporary impairment losses	$ 14.2	$ 6.2	$ 10.9	$ 26.8
Other-than-temporary impairment losses recognized in earnings:
Other-than-temporary impairment losses on fixed maturities	0.0	(0.1)	(1.9)	(0.1)
Other-than-temporary impairment losses on equity securities	0.0	(0.1)	0.0	(1.6)
Impairment losses recognized in earnings	0.0	(0.2)	(1.9)	(1.7)
Net realized investment gains	$ 14.2	$ 6.0	$ 9.0	$ 25.1

Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 40.6	$ (61.3)	$ 107.2	$ 21.4
Other comprehensive (loss) income:
Foreign currency translation adjustments	(0.8)	0.4	(4.8)	(0.2)
Unrealized (losses) gains on securities:
(Losses) gains arising during the year	(2.4)	38.5	(63.8)	100.1
Reclassification adjustment for losses (gains) included in net income	(2.4)	(17.4)	0.2	(36.3)
Other comprehensive (loss) income before tax	(5.6)	21.5	(68.4)	63.6
Unrealized (losses) gains on securities:
(Losses) gains arising during the year	(1.1)	10.1	(10.4)	26.0
Reclassification adjustment for losses (gains) included in net income	(0.3)	(5.5)	(0.1)	(11.7)
Income tax (benefit) provision related to other comprehensive income	(1.4)	4.6	(10.5)	14.3
Other comprehensive (loss) income, net of tax	(4.2)	16.9	(57.9)	49.3
Comprehensive income (loss)	$ 36.4	$ (44.4)	$ 49.3	$ 70.7

Condensed Consolidated Statements of Shareholders' Equity - USD ($)
$ in Millions

Total

Common Shares [Member]

Additional Paid-In Capital [Member]

Treasury Shares [Member]

Retained Earnings [Member]

AOCI Attributable to Parent [Member]

Beginning Balance at Dec. 31, 2016

$ 1,792.7

$ 40.0

$ 1,123.3

$ (378.2)

$ 959.9

$ 47.7

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Net income

21.4

Other comprehensive income, net of tax

49.3

Repurchase of common shares

(36.6)

Activity under stock incentive plans

11.7

0.4

11.3

Retirement of common shares (tax payments on equity compensation)

(6.8)

(0.1)

(6.7)

Employee stock purchase plan

1.2

Cash dividends declared - common shares

(24.9)

Ending Balance at Sep. 30, 2017

1,808.0

40.3

1,129.1

(414.8)

956.4

97.0

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Cumulative effect of adoption of ASU | ASU 2016-01 [Member]

0.0

117.5

(117.5)

Cumulative effect of adoption of ASU | ASU 2018-02 [Member]

0.0

(20.7)

20.7

Beginning Balance at Dec. 31, 2017

1,819.7

^[1]

40.4

1,129.1

(423.4)

977.0

96.6

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Net income

107.2

Other comprehensive income, net of tax

(57.9)

Repurchase of common shares

(30.0)

Activity under stock incentive plans

12.7

0.5

12.2

Retirement of common shares (tax payments on equity compensation)

(7.0)

(0.1)

(6.9)

Employee stock purchase plan

1.4

15% Stock Dividend

0.0

4.4

232.9

(237.3)

Cash dividends declared - common shares

(28.0)

Ending Balance at Sep. 30, 2018

$ 1,818.1

$ 45.2

$ 1,368.7

$ (453.4)

$ 915.7

$ (58.1)

[1]	Derived from audited consolidated financial statements.

Condensed Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares			3 Months Ended		9 Months Ended
	Aug. 06, 2018	Aug. 08, 2017	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Statement of Stockholders' Equity [Abstract]
Common shares repurchased (in shares)					500,989	612,034
Repurchase of common shares, weighted average price (in dollars per share)					$ 59.83	$ 59.75
Stock divided declared			15.00%		15.00%
Dividend declared per common share (in dollars per share)	$ 0.27	$ 0.23	$ 0.27	$ 0.23	$ 0.81	$ 0.70

Condensed Consolidated Statements of Cash Flows - USD ($)
$ in Millions

9 Months Ended

Sep. 30, 2018

Sep. 30, 2017

Cash flows from operating activities:

Net income

$ 107.2

$ 21.4

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Amortization and depreciation

23.1

24.4

Share-based payments expense

14.4

11.2

Deferred income tax benefit, net

(7.4)

(6.4)

Net realized investment gains

(9.0)

(25.1)

Undistributed earnings from alternative investment portfolio

(20.7)

(38.6)

Loss on disposals of fixed assets, net

0.0

1.4

Change in:

Accrued investment income

(2.7)

Receivables

(148.5)

(690.9)

Deferred acquisition costs

(15.2)

(19.7)

Ceded unearned premiums

(114.6)

(65.8)

Reserves for losses and loss adjustment expenses

(19.2)

756.5

Unearned premiums

179.4

162.5

Ceded reinsurance payable and funds held

151.3

179.7

Income taxes

8.8

3.5

Accrued underwriting expenses

(1.0)

(42.5)

Other, net

85.1

(16.5)

Cash provided by operating activities

231.0

252.4

Cash flows from investing activities:

Sales of fixed maturity investments

1,158.6

1,069.7

Maturities and mandatory calls of fixed maturity investments

375.1

493.2

Sales of equity securities

165.0

140.0

Sales of other investments

93.6

68.3

Purchases of fixed maturity investments

(1,787.0)

(1,916.9)

Purchases of equity securities

(156.0)

(118.1)

Purchases of other investments

(34.2)

(25.2)

Change in foreign regulatory deposits and voluntary pools

13.4

(27.2)

Change in short-term investments

(47.2)

291.4

Settlements of foreign currency exchange forward contracts

2.0

0.0

Acquisition of Maybrooke, net of cash acquired

(105.2)

Cash acquired with acquisition of Ariscom

15.6

Purchases of fixed assets

(35.8)

(20.4)

Other, net

3.6

(15.6)

Cash used in investing activities

(233.3)

(166.0)

Cash flows from financing activities:

Additional long-term borrowings

0.0

125.0

Activity under stock incentive plans

1.0

0.9

Repurchase of Company's common shares

(30.0)

(36.6)

Payment of cash dividends to common shareholders

(28.0)

(24.9)

Cash (used in) provided by financing activities

(57.0)

64.4

Effect of exchange rate changes on cash

1.2

(1.0)

Change in cash

(58.1)

149.8

Cash, beginning of year

176.6

^[1]

86.0

Cash, end of period

118.5

235.8

Maybrooke [Member]

Cash flows from investing activities:

Acquisition of Maybrooke, net of cash acquired

0.0

(105.2)

Ariscom [Member]

Cash flows from investing activities:

Cash acquired with acquisition of Ariscom

$ 15.6

$ 0.0

[1]	Derived from audited consolidated financial statements.

Basis of Presentation	9 Months Ended
Basis of Presentation	Sep. 30, 2018
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying consolidated financial statements of Argo Group International Holdings, Ltd. (“Argo Group,” “we” or the “Company”) and its subsidiaries have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. The preparation of interim financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. The major estimates reflected in our consolidated financial statements include, but are not limited to, reserves for losses and loss adjustment expenses; reinsurance recoverables, including the reinsurance recoverables allowance for doubtful accounts; estimates of written and earned premiums; reinsurance premium receivable; fair value of investments and assessment of potential impairment; valuation of goodwill and intangibles and our deferred tax asset valuation allowance. Actual results could differ from those estimates. Certain financial information that normally is included in annual financial statements, including certain financial statement footnotes, prepared in accordance with GAAP, is not required for interim reporting purposes and has been condensed or omitted. These statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2017, filed with the Securities and Exchange Commission on February 27, 2018. Effective March 5, 2018, we acquired 100% of the capital stock of Ariscom Compagnia di Assicurazioni S.p.A. (“Ariscom”) upon its release from extraordinary administration by the Italian insurance supervisory authority (“IVASS”). The acquisition is being accounted for in accordance with Accounting Standards Codification (“ASC”) 805, “Business Combinations.” See Note 3, “Acquisition of Ariscom,” for additional discussion regarding the acquisition. The Consolidated Financial Statements as of and for the three and nine months ended September 30, 2018 and the Notes to the Consolidated Financial Statements reflect the consolidated results of Argo Group and Ariscom commencing on the date of acquisition. The interim financial information as of, and for the three and nine months ended September 30, 2018 and 2017 is unaudited. However, in the opinion of management, the interim information includes all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of the results presented for the interim periods. The operating results for the interim periods are not necessarily indicative of the results to be expected for the full year. All significant intercompany amounts have been eliminated in consolidation. Certain reclassifications have been made to financial information presented for prior years to conform to the current year’s presentation. 15% Stock Dividend On February 20, 2018, our Board of Directors declared at 15% stock dividend, payable on March 21, 2018, to shareholders of record at the close of business on March 7, 2018. As a result of the stock dividend, 4,397,520 additional shares were issued. Cash was paid in lieu of fractional shares of our common shares. Excluding repurchased shares, all references to common shares associated with the recalculation of per share amounts in this document and related disclosures have been adjusted to reflect the stock dividend for all periods presented.

Recently Issued Accounting Pronouncements

9 Months Ended

Sep. 30, 2018

Accounting Policies [Abstract]

Recently Issued Accounting Pronouncements

On August 28, 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2018-13, "Fair Value Measurement (Topic 820)." ASU 2018-13 eliminates, adds and modifies certain disclosure requirements on fair value measurements. The guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within the year of adoption. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty are applied prospectively for only the most recent interim or annual period presented in the initial fiscal year adoption. All other amendments are applied retrospectively to all periods presented upon their effective date. Early adoption is permitted. We are currently in the process of evaluating the impact that the adoption of the ASU will have on our financial disclosures.

On February 14, 2018, the FASB issued ASU 2018-2, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” that allows a reclassification from accumulated other comprehensive income ("AOCI") to retained earnings of the stranded tax effects in AOCI resulting from the Tax Cuts and Jobs Act (“TCJA”). Current guidance required the effect of a change in tax laws or rates on deferred tax balances to be reported in income from continuing operations in the accounting period that includes the period of enactment, even if the related income tax effects were originally charged or credited directly to AOCI. The amount of the reclassification would include the effect of the change in the US federal corporate income tax rate on the gross deferred tax amounts and related valuation allowances, if any, at the date of the enactment of TCJA related to items in AOCI. The updated guidance is effective for reporting periods beginning after December 15, 2018 and is to be applied retrospectively to each period in which the effect of the TCJA related to items remaining in AOCI are recognized or at the beginning of the period of adoption. Early adoption is permitted, including adoption in any interim period for public business entities for reporting periods for which financial statements have not yet been issued. We have adopted the guidance effective January 1, 2018. The adoption of this ASU does not affect the Company’s results of operations, financial position, or liquidity. As a result of adopting this ASU, we reclassified $20.7 million of previously recognized deferred taxes from accumulated other comprehensive income into retained earnings as of January 1, 2018.

In August 2016, the FASB issued ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments (Topic 230).” ASU 2016-15 will reduce diversity in practice on how eight specific cash receipts and payments are classified on the statement of cash flows. The ASU was effective for fiscal years beginning after December 15, 2017, including interim periods within the year of adoption. This ASU will have an impact on how we present the distributions received from equity method investees in our statement of cash flows. We have adopted this ASU effective January 1, 2018. This ASU did not have a material impact on the classification of specific cash receipts and payments within the cash flow statement.

In June 2016, the FASB issued ASU 2016-13, “Measurement of Credit Losses on Financial Instruments” (Topic 326). ASU 2016-13 requires organizations to estimate credit losses on certain types of financial instruments, including receivables and available-for-sale debt securities, by introducing an approach based on expected losses. The expected loss approach will require entities to incorporate considerations of historical information, current information and reasonable and supportable forecasts. The guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within the year of adoption. The guidance requires a modified retrospective transition method and early adoption is permitted. We are currently in the process of evaluating the impact that the adoption of the ASU will have on our financial results and disclosures.

In February 2016, the FASB issued ASU 2016-2, “Leases” (Topic 842). ASU 2016-2 requires organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases. Additionally, the ASU modifies current guidance for lessors' accounting. In July 2018, the FASB issued Accounting Standards Update No. 2018-11 (ASU 2018-11): Leases (Topic 842): Targeted Improvements, which provides for an alternative transition method by allowing entities to initially apply the new leases standard at the adoption date (such as January 1, 2019) and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption (comparative periods presented in the financial statements will continue to be in accordance with current GAAP (Topic 840, Leases)). The standard will be effective for annual and interim periods beginning after December 15, 2018, with earlier application permitted.

We have entered into operating leases for office space and certain other assets. We will adopt the new standard on the effective date of January 1, 2019, using a modified retrospective approach as permitted under ASU 2018-11. We continue to execute a project plan, which includes contract review and assessment, data collection, and evaluation of our systems, processes and internal controls. In addition, we are implementing a new lease accounting software which will facilitate the adoption of this standard. We have also engaged a third party to assist with the implementation of this standard. Although we continue to assess the impact of the standard on our consolidated financial statements, we believe adoption and implementation will result in an increase to assets and liabilities, as well as additional disclosures. We do not expect a material impact on our consolidated statement of income or cash flows.

In January 2016, the FASB issued ASU 2016-1, “Recognition and Measurement of Financial Assets and Financial Liabilities” (Subtopic 825-10). ASU 2016-1 requires equity investments that are not consolidated or accounted for under the equity method of accounting to be measured at fair value with changes in fair value recognized in net income. This ASU also requires us to assess the ability to realize our deferred tax assets related to an available-for-sale debt security in combination with our other deferred tax assets. The ASU was effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. We have adopted this ASU effective January 1, 2018. Upon adoption of this ASU, cumulative net unrealized gain on equity securities of $117.5 million, net of deferred income taxes, were reclassified from accumulated other comprehensive income into retained earnings as of January 1, 2018. The change in the fair value of the noted investments is now included in “Net realized investment gains” in our consolidated statements of income. The standard increases the volatility of the results reported in our consolidated statements of income, resulting from the remeasurement of our equity investments.

In May 2014, the FASB issued ASU 2014-9, “Revenue from Contracts with Customers” (Topic 606), which replaces most existing U.S. GAAP revenue recognition guidance and permits the use of either the retrospective or cumulative effect transition method. In August 2015, “Deferral of the Effective Date” (Topic 606), deferred the effective date of this guidance to interim and annual reporting periods beginning after December 15, 2017. Subsequently, in 2016, the FASB issued implementation guidance related to ASU 2014-9, including:


•	ASU 2016-8, “Principal versus Agent considerations (Reporting Revenue Gross versus Net)” (Topic 606), which is intended to provide further clarification on the application of the principal versus agent implementations;


•	ASU 2016-10, “Identifying Performance Obligations and Licensing” (Topic 606), which is intended to clarify the guidance for identifying promised goods or service in a contract with a customer;


•	ASU 2016-11, “Rescission of SEC Guidance Because of Accounting Standards Updates 2014-9 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting” (Topics 605 & 815);


•	ASU 2016-12, “Narrow-Scope Improvements and Practical Expedients” (Topic 606), provides additional guidance for quantitative and qualitative disclosures in certain cases, and makes 12 additional technical corrections and improvements to the new revenue standard.

We adopted this ASU effective January 1, 2018. The adoption of this standard did not have a material impact on our consolidated financial results.

Acquisition of Ariscom	9 Months Ended
Acquisition of Ariscom	Sep. 30, 2018
Business Combinations [Abstract]
Acquisition of Ariscom	Acquisition of Ariscom Effective March 5, 2018, we acquired 100% of the capital stock of Ariscom upon its release from extraordinary administration by IVASS. We injected an amount of capital into Ariscom necessary to meet certain regulatory requirements and thresholds. As part of this capital infusion, we have become the sole shareholder of Ariscom. The acquisition provides Argo Group with an in-market Italian insurance platform and access to Ariscom’s broker and client network throughout Italy, with longer-term opportunities to expand our presence in continental Europe, particularly Spain and Portugal. The acquisition is being accounted for in accordance with ASC 805, “Business Combinations.” Purchase accounting, as defined by ASC 805, requires that the assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. We are in the process of finalizing our determination of fair values, including an independent appraisal of certain assets and liabilities, including intangible assets. We anticipate closing the fair value measurement period by the end of 2018. Ariscom’s financial position, results of operations, and cash flows were not material to our consolidated financial results as of and for the three and nine months ended September 30, 2018.

Investments

9 Months Ended

Sep. 30, 2018

Investments, Debt and Equity Securities [Abstract]

Investments

Included in “Total investments” in our Consolidated Balance Sheets at September 30, 2018 and December 31, 2017 is $139.9 million and $130.8 million, respectively, of assets managed on behalf of the trade capital providers, who are third-party participants that provide underwriting capital to the operations of Syndicate 1200.

Fixed Maturities

The amortized cost, gross unrealized gains, gross unrealized losses and fair value in fixed maturity investments were as follows:



September 30, 2018
(in millions)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Fixed maturities
U.S. Governments	$	288.8	$	0.1	$	8.1	$	280.8
Foreign Governments	267.6		2.8		4.3		266.1
Obligations of states and political subdivisions	241.6		3.8		2.4		243.0
Corporate bonds	1,713.7		11.8		29.5		1,696.0
Commercial mortgage-backed securities	160.3		—		3.3		157.0
Residential mortgage-backed securities	390.2		1.7		12.0		379.9
Asset-backed securities	174.5		0.2		1.3		173.4
Collateralized loan obligations	259.8		1.3		1.1		260.0
Total fixed maturities	$	3,496.5	$	21.7	$	62.0	$	3,456.2



December 31, 2017
(in millions)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Fixed maturities
U.S. Governments	$	419.9	$	0.2	$	5.0	$	415.1
Foreign Governments	229.0		6.7		2.5		233.2
Obligations of states and political subdivisions	327.7		9.3		1.1		335.9
Corporate bonds	1,514.5		24.4		13.2		1,525.7
Commercial mortgage-backed securities	136.3		0.1		1.5		134.9
Residential mortgage-backed securities	309.3		2.8		2.7		309.4
Asset-backed securities	161.3		0.7		0.8		161.2
Collateralized loan obligations	222.6		5.9		0.5		228.0
Total fixed maturities	$	3,320.6	$	50.1	$	27.3	$	3,343.4

Contractual Maturity

The amortized cost and fair values of fixed maturity investments as of September 30, 2018, by contractual maturity, were as follows:



(in millions)	Amortized Cost		Fair Value
Due in one year or less	$	251.2	$	250.8
Due after one year through five years	1,522.2		1,508.3
Due after five years through ten years	586.4		575.7
Thereafter	151.9		151.1
Structured securities	984.8		970.3
Total	$	3,496.5	$	3,456.2

The expected maturities may differ from the contractual maturities because debtors may have the right to call or prepay obligations.

Other Investments

Details regarding the carrying value and unfunded investment commitments of other investments as of September 30, 2018 and December 31, 2017 were as follows:



September 30, 2018
(in millions)	Carrying Value		Unfunded Commitments
Investment Type
Hedge funds	$	126.2	$	—
Private equity	203.6		118.0
Long only funds	153.4		—
Other	4.3		—
Total other investments	$	487.5	$	118.0



December 31, 2017
(in millions)	Carrying Value		Unfunded Commitments
Investment Type
Hedge funds	$	163.6	$	—
Private equity	179.2		129.9
Long only funds	196.5		—
Other	4.3		—
Total other investments	$	543.6	$	129.9

The following describes each investment type:


•	Hedge funds: Hedge funds include funds that primarily buy and sell stocks, including short sales, multi-strategy credit, relative value credit and distressed credit.


•	Private equity: Private equity includes buyout funds, real asset/infrastructure funds, credit special situations funds, mezzanine lending funds and direct investments and strategic non-controlling minority investments in private companies that are principally accounted for using the equity method of accounting.


•	Long only funds: Our long only funds include a fund that primarily owns international stocks and funds that primarily own investment-grade corporate and sovereign fixed income securities.


•	Other: Other includes participation in investment pools.

Unrealized Losses and Other-Than-Temporary Impairments

An aging of unrealized losses on our investments in fixed maturities is presented below:



September 30, 2018	Less Than One Year				One Year or Greater				Total
(in millions)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Fixed maturities
U.S. Governments	$	260.0	$	7.2	$	17.1	$	0.9	$	277.1	$	8.1
Foreign Governments	229.5		4.2		5.0		0.1		234.5		4.3
Obligations of states and political subdivisions	76.0		1.6		14.4		0.8		90.4		2.4
Corporate bonds	1,234.1		27.6		23.1		1.9		1,257.2		29.5
Commercial mortgage-backed securities	133.1		2.3		15.7		1.0		148.8		3.3
Residential mortgage-backed securities	317.6		11.3		13.6		0.7		331.2		12.0
Asset-backed securities	141.9		1.0		6.3		0.3		148.2		1.3
Collateralized loan obligations	192.7		1.1		—		—		192.7		1.1
Total fixed maturities	$	2,584.9	$	56.3	$	95.2	$	5.7	$	2,680.1	$	62.0



December 31, 2017	Less Than One Year				One Year or Greater				Total
(in millions)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Fixed maturities
U.S. Governments	$	313.7	$	1.9	$	83.7	$	3.1	$	397.4	$	5.0
Foreign Governments	175.2		2.0		35.9		0.5		211.1		2.5
Obligations of states and political subdivisions	33.3		0.5		22.4		0.6		55.7		1.1
Corporate bonds	674.1		9.9		77.7		3.3		751.8		13.2
Commercial mortgage-backed securities	58.2		0.4		37.8		1.1		96.0		1.5
Residential mortgage-backed securities	164.4		1.6		52.4		1.1		216.8		2.7
Asset-backed securities	85.4		0.4		31.9		0.4		117.3		0.8
Collateralized loan obligations ⁽¹⁾	34.6		0.5		0.9		—		35.5		0.5
Total fixed maturities	$	1,538.9	$	17.2	$	342.7	$	10.1	$	1,881.6	$	27.3


⁽¹⁾	Unrealized losses one year or greater are less than $0.1 million.

We regularly evaluate our investments for other-than-temporary impairment. For fixed maturity securities, the evaluation for a credit loss is generally based on the present value of expected cash flows of the security as compared to the amortized book value. For structured securities, frequency and severity of loss inputs are used in projecting future cash flows of the securities. Loss frequency is measured as the credit default rate, which includes such factors as loan-to-value ratios and credit scores of borrowers. We also recognize other-than-temporary losses on fixed maturity securities that we intend to sell. Effective January 1, 2018, the Company adopted ASU 2016-1. As a result, changes in the fair value of equity securities are recognized in net realized investment gains in the Consolidated Statement of Income.

We hold a total of 8,864 securities, of which 3,437 were in an unrealized loss position for less than one year and 105 were in an unrealized loss position for a period one year or greater as of September 30, 2018. Unrealized losses greater than twelve months on fixed maturities were the result of a number of factors, including increased credit spreads, foreign currency fluctuations and higher market yields relative to the date the securities were purchased, and for structured securities, by the performance of the underlying collateral, as well. In considering whether an investment is other-than-temporarily impaired or not, we also considered that we do not intend to sell the investments and it is unlikely that we will be required to sell the investments before recovery of their amortized cost bases, which may be maturity. We do not consider these investments to be other-than-temporarily impaired at September 30, 2018.

We recognized other-than-temporary losses on our fixed maturities and equity portfolio as follows:



	For the Three Months Ended September 30,					For the Nine Months Ended September 30,
(in millions)	2018		2017			2018			2017
Other-than-temporary impairment:
Corporate bonds	$	—	$	(0.1	)	$	(1.9	)	$	(0.1	)
Equity securities	—		(0.1		)	—			(1.6		)
Other-than-temporary impairment losses	$	—	$	(0.2	)	$	(1.9	)	$	(1.7	)

Net Realized Investment Gains and Losses

The following table presents our gross realized investment gains (losses):



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(in millions)	2018			2017			2018			2017
Realized gains on fixed maturities and other
Fixed maturities	$	4.6		$	6.3		$	15.8		$	18.9
Equity securities ⁽¹⁾	—			9.4			—			37.1
Other and short-term investments	7.6			7.2			34.9			18.5
	12.2			22.9			50.7			74.5
Realized losses on fixed maturities and other
Fixed maturities	(2.8		)	(4.8		)	(14.2		)	(16.0		)
Equity securities ⁽¹⁾	—			(1.4		)	—			(3.9		)
Other and short-term investments	(8.8		)	(10.5		)	(34.4		)	(27.8		)
Other-than-temporary impairment losses on fixed maturities	—			(0.1		)	(1.9		)	(0.1		)
Other-than-temporary impairment losses on equity securities	—			(0.1		)	—			(1.6		)
	(11.6		)	(16.9		)	(50.5		)	(49.4		)
Equity securities ⁽¹⁾
Net realized gains on equity securities sold during the period	9.1			—			30.9			—
Change in unrealized gains (losses) on equity securities held at the end of the period	4.5			—			(22.1		)	—
Net realized gains on equity securities	13.6			—			8.8			—
Net realized investment gains before income taxes	14.2			6.0			9.0			25.1
Income tax expense	(3.3		)	(2.2		)	(2.8		)	(7.9		)
Net realized investment gains, net of income taxes	$	10.9		$	3.8		$	6.2		$	17.2

⁽¹⁾

Effective January 1, 2018, we adopted ASU 2016-1. As a result, unrealized gains (losses) at the date of adoption have been reclassified from accumulated other comprehensive income to retained earnings. Additionally, all changes in the fair value of equity securities are recognized in net realized investment gains (losses). Prior periods have not been restated to conform to the current presentation. See Note 2, "Recently Issued Accounting Pronouncements."

The cost of securities sold is based on the specific identification method.

Changes in unrealized appreciation (depreciation) related to investments are summarized as follows:



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(in millions)	2018			2017			2018			2017
Change in unrealized (losses) gains
Fixed maturities	$	(4.3	)	$	9.5		$	(63.2	)	$	41.6
Equity securities	—			11.7			—			20.2
Other investments	—			(0.1		)	0.1			2.0
Short-term investments	(0.5		)	—			(0.5		)	—
Net unrealized investment (losses) gains before income taxes	(4.8		)	21.1			(63.6		)	63.8
Income tax benefit (expense)	1.4			(4.6		)	10.5			(14.3		)
Net unrealized investment (losses) gains, net of income taxes	$	(3.4	)	$	16.5		$	(53.1	)	$	49.5

Foreign Currency Exchange Forward Contracts

We entered into foreign currency exchange forward contracts to manage operational currency exposure on our Canadian dollar (“CAD”) investment portfolio, minimize negative impacts to investment portfolio returns, and gain exposure to a total return strategy which invests in multiple currencies. The currency forward contracts are carried at fair value in our Consolidated Balance Sheets in “Other liabilities.” The gains and losses are included in “Net realized investment gains (losses)” in our Consolidated Statements of Income.

The fair value of our foreign currency exchange forward contracts as of September 30, 2018 and December 31, 2017 was as follows:



(in millions)	September 30, 2018			December 31, 2017
Operational currency exposure	$	(4.7	)	$	(0.2	)
Asset manager investment exposure	0.5			(0.9		)
Total return strategy	(0.6		)	0.7
Total	$	(4.8	)	$	(0.4	)

The following table represents our gross investment realized gains and losses on our foreign currency exchange forward contracts:



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(in millions)	2018			2017			2018			2017
Realized gains
Operational currency exposure	$	0.4		$	1.8		$	6.4		$	7.5
Asset manager investment exposure	1.4			0.6			14.4			1.1
Total return strategy	5.6			4.1			12.5			7.7
Gross realized investment gains	7.4			6.5			33.3			16.3
Realized losses
Operational currency exposure	(2.7		)	(4.2		)	(7.0		)	(10.1		)
Asset manager investment exposure	(0.9		)	(3.6		)	(12.5		)	(10.4		)
Total return strategy	(5.2		)	(3.5		)	(13.3		)	(6.2		)
Gross realized investment losses	(8.8		)	(11.3		)	(32.8		)	(26.7		)
Net realized investment (losses) gains on foreign currency exchange forward contracts	$	(1.4	)	$	(4.8	)	$	0.5		$	(10.4	)

Regulatory Deposits, Pledged Securities and Letters of Credit

We are required to maintain assets on deposit with various regulatory authorities to support our insurance and reinsurance operations. We maintain assets pledged as collateral in support of irrevocable letters of credit issued under the terms of certain reinsurance agreements for reported loss and loss expense reserves. The following table presents our components of restricted assets at September 30:



(in millions)	September 30, 2018		September 30, 2017
Securities on deposit for regulatory and other purposes	$	180.6	$	177.8
Securities pledged as collateral for letters of credit	76.5		42.6
Securities and cash on deposit supporting Lloyd’s business	418.4		405.6
Total restricted investments	$	675.5	$	626.0

Fair Value Measurements

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability, or in the absence of a principal market, the most advantageous market. Market participants are buyers and sellers in the principal (or most advantageous) market that are independent, knowledgeable, able to transact for the asset or liability and willing to transfer the asset or liability.

Valuation techniques consistent with the market approach, income approach and/or cost approach are used to measure fair value. The inputs of these valuation techniques are categorized into three levels.


•	Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that can be accessed at the reporting date. We define actively traded as a security that has traded in the past seven days. We receive one quote per instrument for Level 1 inputs.


•	Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. We receive one quote per instrument for Level 2 inputs.


•	Level 3 inputs are unobservable inputs. Unobservable inputs reflect our own judgments about the assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances.

We receive fair value prices from third-party pricing services and our outside investment managers. These prices are determined using observable market information such as dealer quotes, market spreads, cash flows, yield curves, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the security’s terms and conditions, among other things. We have reviewed the processes used by the third-party providers for pricing the securities, and have determined that these processes result in fair values consistent with GAAP requirements. In addition, we review these prices for reasonableness, and have not adjusted any prices received from the third-party providers as of September 30, 2018. A description of the valuation techniques we use to measure assets at fair value is as follows:

Fixed Maturities (Available-for-Sale) Levels 1 and 2:


•	United States Treasury securities are typically valued using Level 1 inputs. For these securities, we obtain fair value measurements from third-party pricing services using quoted prices (unadjusted) in active markets at the reporting date.

•

United States Government agencies, non-U.S. Government securities, obligations of states and political subdivisions, credit securities and foreign denominated government and credit securities are reported at fair value using Level 2 inputs. For these securities, we obtain fair value measurements from third-party pricing services. Observable data may include dealer quotes, market spreads, yield curves, live trading levels, trade execution data, credit information and the security’s terms and conditions, among other things.

•

Asset and mortgage-backed securities and collateralized loan obligations are reported at fair value using Level 2 inputs. For these securities, we obtain fair value measurements from third-party pricing services. Observable data may include dealer quotes, market spreads, cash flows, yield curves, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the security’s terms and conditions, among other things.

Fixed Maturities (Available-for-Sale) Levels 3:


•	We own term loans that are valued using unobservable inputs.

Equity Securities Level 1: Equity securities are principally reported at fair value using Level 1 inputs. For these securities, we obtain fair value measurements from a third-party pricing service using quoted prices (unadjusted) in active markets at the reporting date.

Equity Securities Level 2: We own interests in a mutual fund that is reported at fair value using Level 2 inputs. The valuation is based on the fund’s net asset value per share, at the end of each month. The underlying assets in the fund are valued primarily on the basis of closing market quotations or official closing prices on each valuation day.

Equity Securities Level 3: We own certain equity securities that are reported at fair value using Level 3 inputs. The valuation techniques for these securities include the following:


•	Fair value measurements obtained from the National Association of Insurance Commissioners’ Security Valuation Office at the reporting date.


•	Fair value measurements for an investment in an equity fund obtained by applying final prices provided by the administrator of the fund, which is based upon certain estimates and assumptions.


•	Fair value measurements from a broker and an independent valuation service, both based upon estimates and assumptions.

Other Investments Level 2: Foreign regulatory deposits are assets held in trust in jurisdictions where there is a legal and regulatory requirement to maintain funds locally in order to protect policyholders. Lloyd’s is the appointed investment manager for the funds. These assets are invested in short-term government securities, agency securities and corporate bonds and are valued using Level 2 inputs based upon values obtained from Lloyd’s.

Short-term Investments: Short-term investments are principally reported at fair value using Level 1 inputs, with the exception of short-term corporate and governmental bonds reported at fair value using Level 2 inputs as described in the fixed maturities section above. Values for the investments categorized as Level 1 are obtained from various financial institutions as of the reporting date.

Transfers Between Level 1 and Level 2 Securities: There were no transfers between Level 1 and Level 2 securities during the three and nine months ended September 30, 2018.

Based on an analysis of the inputs, our financial assets measured at fair value on a recurring basis have been categorized as follows:



			Fair Value Measurements at Reporting Date Using
(in millions)	September 30, 2018		Level 1^(a)		Level 2 ^(b)		Level 3 ^(c)
Fixed maturities
U.S. Governments	$	280.8	$	272.0	$	8.8	$	—
Foreign Governments	266.1		—		266.1		—
Obligations of states and political subdivisions	243.0		—		243.0		—
Corporate bonds	1,696.0		—		1,692.0		4.0
Commercial mortgage-backed securities	157.0		—		157.0		—
Residential mortgage-backed securities	379.9		—		379.9		—
Asset-backed securities	173.4		—		173.4		—
Collateralized loan obligations	260.0		—		260.0		—
Total fixed maturities	3,456.2		272.0		3,180.2		4.0
Equity securities	486.5		476.0		—		10.5
Other investments	95.1		—		95.1		—
Short-term investments	434.5		399.3		35.2		—
	$	4,472.3	$	1,147.3	$	3,310.5	$	14.5


^(a)	Quoted prices in active markets for identical assets


^(b)	Significant other observable inputs


^(c)	Significant unobservable inputs



			Fair Value Measurements at Reporting Date Using
(in millions)	December 31, 2017		Level 1^(a)		Level 2 ^(b)		Level 3 ^(c)
Fixed maturities
U.S. Governments	$	415.1	$	410.6	$	4.5	$	—
Foreign Governments	233.2		—		233.2		—
Obligations of states and political subdivisions	335.9		—		335.9		—
Corporate bonds	1,525.7		—		1,523.8		1.9
Commercial mortgage-backed securities	134.9		—		134.9		—
Residential mortgage-backed securities	309.4		—		309.4		—
Asset-backed securities	161.2		—		161.2		—
Collateralized loan obligations	228.0		—		228.0		—
Total fixed maturities	3,343.4		410.6		2,930.9		1.9
Equity securities	487.4		483.0		2.1		2.3
Other investments	108.8		—		108.8		—
Short-term investments	368.5		333.7		34.8		—
	$	4,308.1	$	1,227.3	$	3,076.6	$	4.2


^(a)	Quoted prices in active markets for identical assets


^(b)	Significant other observable inputs


^(c)	Significant unobservable inputs

The fair value measurements in the tables above do not equal “Total investments” on our Consolidated Balance Sheets as they exclude certain other investments that are accounted for under the equity-method of accounting.

A reconciliation of the beginning and ending balances for the investments categorized as Level 3 are as follows:

Fair Value Measurements Using Observable Inputs (Level 3)



(in millions)	Credit Financial			Equity Securities			Total
Beginning balance, January 1, 2018	$	1.9		$	2.3		$	4.2
Transfers into Level 3	—			—			—
Transfers out of Level 3	—			—			—
Total gains or losses (realized/unrealized):
Included in net income (loss)	—			(0.2		)	(0.2		)
Included in other comprehensive income (loss)	(0.1		)	—			(0.1		)
Purchases, issuances, sales, and settlements:
Purchases	2.2			8.4			10.6
Issuances	—			—			—
Sales	—			—			—
Settlements	—			—			—
Ending balance, September 30, 2018	$	4.0		$	10.5		$	14.5
Amount of total gains or losses for the year included in net income (loss) attributable to the change in unrealized gains or losses relating to assets still held at September 30, 2018	$	—		$	—		$	—



(in millions)	Credit Financial			Equity Securities		Total
Beginning balance, January 1, 2017	$	2.0		$	0.4	$	2.4
Transfers into Level 3	—			—		—
Transfers out of Level 3	—			—		—
Total gains or losses (realized/unrealized):
Included in net income (loss)	—			—		—
Included in other comprehensive income (loss)	(0.1		)	0.2		0.1
Purchases, issuances, sales, and settlements:
Purchases	—			1.7		1.7
Issuances	—			—		—
Sales	—			—		—
Settlements	—			—		—
Ending balance, December 31, 2017	$	1.9		$	2.3	$	4.2
Amount of total gains or losses for the year included in net income (loss) attributable to the change in unrealized gains or losses relating to assets still held at December 31, 2017	$	—		$	—	$	—

At September 30, 2018 and December 31, 2017, we did not have any financial assets or financial liabilities measured at fair value on a nonrecurring basis or any financial liabilities on a recurring basis.

Reserves for Losses and Loss Adjustment Expenses

9 Months Ended

Sep. 30, 2018

Insurance [Abstract]

Reserves for Losses and Loss Adjustment Expenses

The following table provides a reconciliation of reserves for losses and loss adjustment expenses (“LAE”):



	For the Nine Months Ended September 30,
(in millions)	2018			2017
Net reserves beginning of the year	$	2,488.0		$	2,180.2
Net Maybrooke reserves acquired	—			131.8
Net Ariscom reserves acquired	49.4			—
Add:
Losses and LAE incurred during current calendar year, net of reinsurance:
Current accident year	764.3			775.1
Prior accident years	(4.1		)	4.4
Losses and LAE incurred during calendar year, net of reinsurance	760.2			779.5
Deduct:
Losses and LAE payments made during current calendar year, net of reinsurance:
Current accident year	223.2			165.6
Prior accident years	469.0			413.7
Losses and LAE payments made during current calendar year, net of reinsurance:	692.2			579.3
Change in participation interest ⁽¹⁾	(29.4		)	(23.2		)
Foreign exchange adjustments	(20.8		)	18.9
Net reserves - end of period	2,555.2			2,507.9
Add:
Reinsurance recoverables on unpaid losses and LAE, end of period	1,736.5			1,798.0
Gross reserves - end of period	$	4,291.7		$	4,305.9


⁽¹⁾	Amount represents the change in reserves due to changing our participation in Syndicates 1200 and 1910.

Reserves for losses and LAE represent the estimated indemnity cost and related adjustment expenses necessary to investigate and settle claims. Such estimates are based upon individual case estimates for reported claims, estimates from ceding companies for reinsurance assumed and actuarial estimates for losses that have been incurred but not yet reported to the insurer. Any change in probable ultimate liabilities is reflected in current operating results.

The impact from the (favorable) unfavorable development of prior accident years’ loss and LAE reserves on each reporting segment is presented below:



	For the Nine Months Ended September 30,
(in millions)	2018			2017
U.S. Operations	$	(14.8	)	$	(28.7	)
International Operations	(0.8		)	17.0
Run-off Lines	11.5			16.1
Total unfavorable (favorable) prior-year development	$	(4.1	)	$	4.4

The following describes the primary factors behind each segment’s prior accident year reserve development for the nine months ended September 30, 2018 and 2017:

Nine months ended September 30, 2018:


•	U.S. Operations: Favorable development in liability and surety lines, partially offset by unfavorable development in commercial multi-peril lines.


•	International Operations: Favorable development in property partially offset by unfavorable development within specialty and liability lines.


•	Run-off Lines: Unfavorable development in liability lines as well as asbestos and environmental.

Nine months ended September 30, 2017:


•	U.S. Operations: Favorable development for the workers compensation, surety and commercial automobile lines.


•	International Operations: Unfavorable development in the property and liability lines, primarily due to the first quarter 2017 Ogden rate change and claims from Hurricane Matthew.


•	Run-off Lines: Unfavorable development in asbestos and other run-off segments partially offset by favorable development in risk management liability.

In the opinion of management, our reserves represent the best estimate of our ultimate liabilities, based on currently known facts, current law, current technology and assumptions considered reasonable where facts are not known. Due to the significant uncertainties and related management judgments, there can be no assurance that future favorable or unfavorable loss development, which may be material, will not occur.

Disclosures about Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Disclosures about Fair Value of Financial Instruments

Cash. The carrying amount approximates fair value.

Investment securities and short-term investments. See Note 4, “Investments,” for additional information.

Premiums receivable and reinsurance recoverables on paid losses. The carrying value of current receivables and reinsurance recoverables on paid losses approximates fair value.

Debt. At September 30, 2018 and December 31, 2017, the fair value of our Junior subordinated debentures, Senior unsecured fixed rate notes and Other indebtedness was estimated using appropriate market indices or quoted prices from external sources based on current market conditions. All of these debt instruments would be in Level 3 of the fair value hierarchy, as the fair value estimates shown below were calculated using unobservable inputs reflecting our assumptions about the assumptions market participants would use in pricing the liabilities.

A summary of our financial instruments whose carrying value did not equal fair value is shown below:



	September 30, 2018				December 31, 2017
(in millions)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Junior subordinated debentures:
Trust preferred debentures	$	172.7	$	170.9	$	172.7	$	172.9
Subordinated debentures acquired with Maybrooke	84.2		87.2		83.9		85.0
Total junior subordinated debentures	256.9		258.1		256.6		257.9
Senior unsecured fixed rate notes	139.8		140.6		139.6		141.2
Floating rate loan stock	58.3		57.6		58.9		59.0

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Shareholders' Equity

9 Months Ended

Sep. 30, 2018

Equity [Abstract]

Shareholders' Equity

Shareholders’ Equity

On February 20, 2018, the Board of Directors declared a 15% stock dividend, payable March 21, 2018 to all shareholders of record at the close of business on March 7, 2018. As a result of the stock dividend, 4,397,520 additional shares were issued. Cash was paid in lieu of fractional shares of our common shares. Excluding repurchased shares, all references to common shares and related per share amounts in this document and related disclosures have been adjusted to reflect the stock dividend for all periods presented.

On August 6, 2018, our Board of Directors declared a quarterly cash dividend in the amount of $0.27 on each share of common stock outstanding. On September 14, 2018, we paid $9.3 million to our shareholders of record on August 31, 2018.

On August 8, 2017, our Board of Directors declared a quarterly cash dividend in the amount of $0.23 on each share of common stock outstanding, on a post-stock dividend basis. On September 15, 2017, we paid $8.3 million to our shareholders of record on September 1, 2017.

On May 3, 2016, our Board of Directors authorized the repurchase of up to $150.0 million of our common shares (“2016 Repurchase Authorization”). The 2016 Repurchase Authorization supersedes all previous Repurchase Authorizations. As of September 30, 2018, availability under the 2016 Repurchase Authorization for future repurchases of our common shares was $55.1 million.

For the nine months ended September 30, 2018, we repurchased a total of 500,989 common shares for $30.0 million. A summary of activity from January 1, 2018 through September 30, 2018 follows.

A summary of common shares repurchased for the nine months ended September 30, 2018 is shown below:



Repurchase Type	Date Trading Plan Initiated	2018 Purchase Period	Number of Shares Repurchased	Average Price of Shares Repurchased		Total Cost (in millions)		Repurchase Authorization Year
10b5-1 Trading Plan	12/18/2017	01/02/2018-02/16/2018	225,281	$	59.31	$	13.3	2016
10b5-1 Trading Plan	6/18/2018	06/22/2018- 08/07/2018	75,661	$	59.30	4.5		2016
10b5-1 Trading Plan	9/18/2018	09/19/2018-09/20/2018	7,492	$	59.86	0.5		2016
Open Market	N/A	02/20/2018-03/02/2018	89,305	$	59.03	5.3		2016
Open Market	N/A	08/13/2018-09/17/2018	103,250	$	62.07	6.4		2016
Total			500,989	$	59.83	$	30.0

Accumulated Other Comprehensive (Loss) Income

9 Months Ended

Sep. 30, 2018

Equity [Abstract]

Accumulated Other Comprehensive (Loss) Income

A summary of changes in accumulated other comprehensive (loss) income, net of taxes (where applicable) by component for the nine months ended September 30, 2018, and 2017 is presented below:



(in millions)	Foreign Currency Translation Adjustments			Unrealized Holding Gains on Securities			Defined Benefit Pension Plans			Total
Balance, January 1, 2018	$	(19.0	)	$	121.9		$	(6.3	)	$	96.6
Cumulative effect of adoption of ASU 2016-01	—			(117.5		)	—			(117.5		)
Cumulative effect of adoption of ASU 2018-02	—			22.1			(1.4		)	20.7
Other comprehensive income (loss) before reclassifications	(4.8		)	(53.4		)	—			(58.2		)
Amounts reclassified from accumulated other comprehensive income (loss)	—			0.3			—			0.3
Net current-period other comprehensive income (loss)	(4.8		)	(148.5		)	(1.4		)	(154.7		)
Balance at September 30, 2018	$	(23.8	)	$	(26.6	)	$	(7.7	)	$	(58.1	)



(in millions)	Foreign Currency Translation Adjustments			Unrealized Holding Gains on Securities			Defined Benefit Pension Plans			Total
Balance, January 1, 2017	$	(17.6	)	$	72.4		$	(7.1	)	$	47.7
Other comprehensive income (loss) before reclassifications	(0.2		)	74.1			—			73.9
Amounts reclassified from accumulated other comprehensive income (loss)	—			(24.6		)	—			(24.6		)
Net current-period other comprehensive income (loss)	(0.2		)	49.5			—			49.3
Balance at September 30, 2017	$	(17.8	)	$	121.9		$	(7.1	)	$	97.0

The amounts reclassified from accumulated other comprehensive (loss) income shown in the above table have been included in the following captions in our Consolidated Statements of Income:



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(in millions)	2018			2017			2018		2017
Unrealized gains and losses on securities:
Net realized investment gains (losses)	$	(2.4	)	$	(17.4	)	$	0.2	$	(36.3	)
Provision for income taxes	0.3			5.5			0.1		11.7
Net of taxes	$	(2.1	)	$	(11.9	)	$	0.3	$	(24.6	)

Net Income (Loss) Per Common Share

9 Months Ended

Sep. 30, 2018

Earnings Per Share [Abstract]

Net Income (Loss) Per Common Share

The following table presents the calculation of net income (loss) per common share on a basic and diluted basis:



	For the Three Months Ended September 30,					For the Nine Months Ended September 30,
(in millions, except number of shares and per share amounts)	2018		2017			2018		2017
Net income (loss)	$	40.6	$	(61.3	)	$	107.2	$	21.4
Weighted average common shares outstanding - basic	33,956,695		34,475,452			33,921,632		34,586,931
Effect of dilutive securities:
Equity compensation awards	699,633		—			767,211		940,242
Weighted average common shares outstanding - diluted	34,656,328		34,475,452			34,688,843		35,527,173
Net income (loss) per common share:
Basic	$	1.20	$	(1.78	)	$	3.16	$	0.62
Diluted	$	1.17	$	(1.78	)	$	3.09	$	0.60

Excluded from the weighted average common shares outstanding calculation at September 30, 2018 and 2017 are 11,285,996 shares and 10,640,789 shares, respectively, which are held as treasury shares. The shares are excluded as of their repurchase date. For the three and nine months ended September 30, 2018 there were no equity compensation awards with an anti-dilutive effect. For the three months ended September 30, 2017 there were 818,632 shares not included in the calculation of diluted net loss per common share as their effect would have been anti-dilutive. For the nine months ended September 30, 2017 there were no equity compensation awards with an anti-dilutive effect.

Supplemental Cash Flow Information

9 Months Ended

Sep. 30, 2018

Supplemental Cash Flow Elements [Abstract]

Supplemental Cash Flow Information

Interest paid and income taxes paid (recovered) were as follows:



	For the Nine Months Ended September 30,
(in millions)	2018		2017
Senior unsecured fixed rate notes	$	7.0	$	7.0
Junior subordinated debentures	11.2		9.4
Other indebtedness	4.9		3.0
Revolving credit facility	—		0.3
Total interest paid	$	23.1	$	19.7

Income taxes paid	18.1		10.1
Income taxes recovered	—		(2.4		)
Income taxes paid, net	$	18.1	$	7.7

Share-based Compensation

9 Months Ended

Sep. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-based Compensation

The fair value method of accounting is used for share-based compensation plans. Under the fair value method, compensation cost is measured based on the fair value of the award at the measurement date and recognized over the requisite service period. We use the Black-Scholes model to estimate the fair values on the measurement date for share options and share appreciation rights (“SARs”). The Black-Scholes model uses several assumptions to value a share award. The risk-free rate of return assumption is based on the five-year U.S. Treasury constant maturity rate on the measurement date. The expected dividend yield is based on our history and expected dividend payouts. The expected award life is based upon the average holding period over the history of the incentive plan. The expected volatility assumption is based on the historical change in our stock price over the previous five years preceding the measurement date.

The following table summarizes the assumptions we used for the nine months ended September 30, 2018 and 2017:



	For the Nine Months Ended September 30,
	2018	2017
Risk-free rate of return	2.96%	1.85%
Expected dividend yields	1.84%	1.71%
Expected award life (years)	4.49	4.48
Expected volatility	17.82%	18.13%

All outstanding awards were adjusted to reflect the 15% stock dividend, resulting in a 15% increase to the number of awards outstanding and a 13.04% reduction in the exercise price.

Argo Group’s Long-Term Incentive Plan

In November 2007, our shareholders approved the 2007 Long-Term Incentive Plan (the “2007 Plan”), which provides for an aggregate of 4.5 million shares of our common stock that may be issued to executives, non-employee directors, and other key employees. As of May 2014, 1.46 million shares remained available for grant under the 2007 Plan. In May 2014, our shareholders approved the 2014 Long-Term Incentive Plan (the “2014 Plan”), which provides for an additional 2.8 million shares of our common stock to be available for issuance to executives, non-employee directors and other key employees. The share awards may be in the form of share options, SARs, restricted shares, restricted share awards, restricted share unit awards, performance awards, other share-based awards and other cash-based awards. Shares issued under this plan may be shares that are authorized and unissued or shares that we reacquired, including shares purchased on the open market. Share options and SARs will count as one share for the purposes of the limits under the incentive plans; restricted shares, restricted share units, performance units, performance shares or other share-based incentive awards which settle in common shares will count as 2.75 shares for purpose of the limits under the 2014 Plan.

Share options may be in the form of incentive share options, non-qualified share options and restorative options. Share options are required to have an exercise price that is not less than the market value on the date of grant. We are prohibited from repricing the options, except for the impact of stock dividend declarations. The term of the share options cannot exceed seven years from the grant date.

Restricted Shares

A summary of restricted share activity as of September 30, 2018 and changes during the nine months ended is as follows:



	Shares		Weighted-Average Grant Date Fair Value
Outstanding at January 1, 2018	767,140		$	42.91
Granted	339,515		$	48.54
Vested and issued	(202,809	)	$	43.18
Expired or forfeited	(87,435	)	$	45.00
Outstanding at September 30, 2018	816,411		$	44.96

The restricted shares vest over one to eight years. Expense recognized under this plan for the restricted shares was $2.6 million and $10.9 million for the three and nine months ended September 30, 2018, respectively, as compared to $2.5 million and $7.5 million for the three and nine months ended September 30, 2017. Compensation expense for all share-based compensation awards is included in “Underwriting, acquisition and insurance expenses” in the accompanying Consolidated Statements of Income. As of September 30, 2018, there was $26.6 million of total unrecognized compensation cost related to restricted share compensation arrangements granted by Argo Group.

Stock-Settled SARs

A summary of stock-settled SARs activity as of September 30, 2018 and changes during the nine months ended is as follows:



	Shares		Weighted-Average Exercise Price
Outstanding at January 1, 2018	1,494,458		$	30.85
Exercised	(540,233	)	$	26.64
Expired or forfeited	(16,204	)	$	36.38
Outstanding at September 30, 2018	938,021		$	33.17

The stock-settled SARs vest over a one to four-year period. Upon exercise of the stock-settled SARs, the employee is entitled to receive shares of our common stock equal to the appreciation of the stock as compared to the exercise price. Expense recognized for the stock-settled SARs was $0.4 million and $1.8 million for the three and nine months ended September 30, 2018, respectively, as compared to $0.7 million and $3.5 million for the three and nine months ended September 30, 2017. As of September 30, 2018, there was $0.7 million of total unrecognized compensation cost related to stock-settled SARs outstanding.

Cash-Settled SARs

A summary of cash-settled SARs activity as of September 30, 2018 and changes during the nine months ended is as follows:



	Shares		Weighted-Average Exercise Price
Outstanding at January 1, 2018	189,568		$	28.95
Exercised	(87,665	)	$	27.88
Expired or forfeited	(2,568	)	$	21.23
Outstanding at September 30, 2018	99,335		$	30.10

As of September 30, 2018, all the cash-settled SARs are fully vested. Upon exercise of the cash-settled SARs, the employee is entitled to receive cash payment for the appreciation in the value of our common stock over the exercise price. We account for the cash-settled SARs as liability awards, which require the awards to be revalued at each reporting period. Expense recognized for the cash-settle SARs was $0.5 million and $1.2 million for the three and nine months ended September 30, 2018, respectively. Expense recognized for the cash-settled SARs for the three months ended September 30, 2017 was $0.3 million. Due to a decrease in the fair market value of our stock, we recouped $0.6 million of expense for nine months ended September 30, 2017. As of September 30, 2018, there was no unrecognized compensation cost related to cash-settled SARs outstanding.

Underwriting, Acquisition and Insurance Expenses

9 Months Ended

Sep. 30, 2018

Underwriting Acquisition And Insurance Expenses [Abstract]

Underwriting, Acquisition and Insurance Expenses

The components of our underwriting, acquisition and insurance expenses are detailed in the table below. General expenses includes certain costs associated with our holding company.



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(in millions)	2018			2017			2018			2017
Commissions	$	88.0		$	70.8		$	212.7		$	201.2
General expenses	83.2			89.7			261.6			266.4
Premium taxes, boards and bureaus	9.8			11.8			27.2			25.9
	181.0			172.3			501.5			493.5
Net deferral of policy acquisition costs	(13.0		)	(6.2		)	(16.5		)	(19.1		)
Total underwriting, acquisition and insurance expenses	$	168.0		$	166.1		$	485.0		$	474.4

Income Taxes

9 Months Ended

Sep. 30, 2018

Income Tax Disclosure [Abstract]

Income Taxes

We are incorporated under the laws of Bermuda and, under current Bermuda law, are not obligated to pay any taxes in Bermuda based upon income or capital gains. We have received an undertaking from the Supervisor of Insurance in Bermuda pursuant to the provisions of the Exempted Undertakings Tax Protection Act, 2011, which exempts us from any Bermuda taxes computed on profits, income or any capital asset, gain or appreciation or any tax in the nature of estate duty or inheritance tax, at least until the year 2035.

We do not consider ourselves to be engaged in a trade or business in the United States or the United Kingdom and, accordingly, do not expect to be subject to direct United States or United Kingdom income taxation.

We have subsidiaries based in the United Kingdom that are subject to the tax laws of that country. Under current law, these subsidiaries are taxed at the applicable corporate tax rates. Eight of the United Kingdom subsidiaries are deemed to be engaged in business in the United States, and therefore, are subject to United States corporate tax in respect of a proportion of their United States underwriting business only. Relief is available against the United Kingdom tax liabilities in respect of overseas taxes paid that arise from the underwriting business. Our United Kingdom subsidiaries file separate United Kingdom income tax returns.

We have subsidiaries based in the United States that are subject to United States tax laws. Under current law, these subsidiaries are taxed at the applicable corporate tax rates. Our United States subsidiaries generally file a consolidated United States federal income tax return.

We also have operations in Belgium, Brazil, France, Ireland, Italy, Luxembourg, Malta, Spain, and Switzerland, which also are subject to income taxes imposed by the jurisdiction in which they operate. We have operations in Barbados and the United Arab Emirates, which are not subject to income tax under the laws of those countries.

On December 22, 2017, U.S. tax legislation referred to as the TCJA was enacted. The effects of changes in tax laws and tax rates are recognized in the period of enactment. Accordingly, we recorded the impacts of the TCJA in our 2017 consolidated financial statements which, among other changes, primarily includes the remeasurement of our deferred tax assets and liabilities for the reduced US federal tax rate from 35% to 21% beginning on January 1, 2018, and the computation of a provisional amount for the loss reserve discounting modifications. We are still analyzing certain aspects of the TCJA and refining our calculations, which could potentially affect the measurement of these balances or potentially give rise to new deferred tax amounts. We have not made any adjustments to the provisional amounts we recorded during the year ended December 31, 2017. Beginning in 2018, the TCJA introduces an additional Base Erosion and Anti-abuse Tax (“BEAT”) provision computed to be an additional liability in excess of the regular US tax liability based upon an alternative BEAT computation. At this time, we have not recorded any provisional amounts for BEAT as we are awaiting information from Lloyd’s to determine the effect of BEAT on our US branches within our UK operations. Thus, our 2018 consolidated financial statements reflect a reasonably estimated provisional amount based on information available and in accordance with SAB 118. SAB 118 provides guidance on accounting for the effects of the U.S. tax reform where our determinations are incomplete but we are able to determine a reasonable estimate. A final determination is required to be made within a measurement period not to extend beyond one year from the enactment date of the U.S. tax reform. As additional guidance is released, the estimate will be updated as necessary.

Our expected income tax provision computed on pre-tax income (loss) at the weighted average tax rate has been calculated as the sum of the pre-tax income (loss) in each jurisdiction multiplied by that jurisdiction’s applicable statutory tax rate. For the three and nine months ended September 30, 2018 and 2017, pre-tax income (loss) attributable to our operations and the operations’ effective tax rates were as follows:



	For the Three Months Ended September 30,
(in millions)	2018						2017
	Pre-Tax Income (Loss)				Effective Tax Rate		Pre-Tax Income (Loss)				Effective Tax Rate
Bermuda	$	6.4			—	%	$	(43.0	)		—	%
United States	34.8				13.4	%	(1.3		)		52.9	%
United Kingdom	3.5				(5.0	)%	(24.6		)		16.4	%
Belgium	—			⁽¹⁾	30.8	%	0.1				36.1	%
Brazil	0.4				—	%	—			⁽¹⁾	—	%
United Arab Emirates	0.2				—	%	3.5				—	%
Ireland	(0.1		)		—	%	(0.1		)		—	%
Italy	(1.8		)		—	%	—			⁽¹⁾	—	%
Malta	1.8				—	%	0.6				—	%
Luxembourg	—			⁽¹⁾	—	%	(1.3		)		—	%
Switzerland	0.1				21.2	%	0.2				18.1	%
Pre-tax income	$	45.3			10.2	%	$	(65.9	)		7.0	%



	For the Nine Months Ended September 30,
(in millions)	2018						2017
	Pre-Tax Income (Loss)				Effective Tax Rate		Pre-Tax Income (Loss)				Effective Tax Rate
Bermuda	$	(1.8	)		—	%	$	8.7			—	%
United States	114.2				15.6	%	57.4				24.1	%
United Kingdom	16.3				12.3	%	(36.6		)		21.6	%
Belgium	—			⁽¹⁾	33.3	%	0.2				36.2	%
Brazil	(1.0		)		—	%	(0.2		)		—	%
United Arab Emirates	0.5				—	%	—			⁽¹⁾	—	%
Ireland	(0.2		)		—	%	(0.1		)		—	%
Italy	(2.9		)		—	%	—			⁽¹⁾	—	%
Malta	2.2				—	%	1.7				—	%
Luxembourg	—			⁽¹⁾	—	%	(3.7		)		—	%
Switzerland	0.1				21.2	%	0.2				21.1	%
Pre-tax income	$	127.4			15.8	%	$	27.6			22.3	%


⁽¹⁾	Pre-tax income for the respective year was less than $0.1 million.

Our effective tax rate may vary significantly from period to period depending on the jurisdiction generating the pre-tax income (loss) and its corresponding statutory tax rate. The geographic distribution of pre-tax income (loss) can fluctuate significantly between periods given the inherit nature of our business. A reconciliation of the difference between the provision for income taxes and the expected tax provision at the weighted average tax rate is as follows:



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(in millions)	2018			2017			2018			2017
Income tax (benefit) provision at expected rate	$	8.4		$	(5.5	)	$	26.8		$	12.9
Tax effect of:
Nontaxable investment income	(0.4		)	(1.1		)	(1.4		)	(3.5		)
Foreign exchange adjustments	(1.0		)	1.4			(1.2		)	1.1
Withholding taxes	0.2			—			0.5			0.3
Prior period adjustments	(2.2		)	(1.2		)	(2.1		)	(1.9		)
Change in valuation allowance	(0.2		)	0.8			(3.6		)	(0.3		)
Other	(0.1		)	1.0			1.2			(2.4		)
Income tax provision	$	4.7		$	(4.6	)	$	20.2		$	6.2

Our gross deferred tax assets are supported by taxes paid in previous periods, reversal of taxable temporary differences and recognition of future taxable income. Management regularly evaluates the recoverability of the deferred tax assets and makes any necessary adjustments to them based upon any changes in management’s expectations of future taxable income. Realization of deferred tax assets is dependent upon our generation of future taxable income sufficient to recover tax benefits that cannot be recovered from taxes paid in the carryback period, generally for our US property and casualty insurers two years for net operating losses and for all our US subsidiaries three years for capital losses. If a company determines that any of its deferred tax assets will not result in future tax benefits, a valuation allowance must be established for the portion of these assets that are not expected to be realized. The net change in valuation allowance for deferred tax assets was a decrease of $3.6 million in 2018 relating to the items discussed below. Based upon a review of our available evidence, both positive and negative discussed above, our management concluded that it is more-likely-than-not that the other deferred tax assets will be realized.

Management has determined that a valuation allowance is required for a portion of the tax-effected net operating loss carryforward included as part of the United States consolidated group of $6.8 million generated from PXRE Corporation and for the tax effected net operating loss carryforward of $0.6 million from ARIS. The valuation allowances have been established as Internal Revenue Code Section 382 limits regarding the application of net operating loss carryforwards following an ownership change. The loss carryforwards available per year for both of these items are $2.8 million, as required by Internal Revenue Code Section 382.

Furthermore, due to cumulative losses incurred since inception, management has concluded that a valuation allowance is required for the full amount of the tax-effected net operating losses generated by our Brazil and Malta entities. Additionally, valuation allowances were established for our Luxembourg and US affiliates acquired in the Maybrooke transaction as well as our Italian operations acquired in the Ariscom transaction.

Accordingly, a valuation allowance is required as of September 30, 2018 of which $6.3 million relates to Brazil operations, $6.3 million relates to Italian operations and $1.0 million relates to Malta operations. During the nine months ended September 30, 2018, the affiliates of Maybrooke Holdings SA have a valuation allowance established in the amount of $1.2 million. The change from 2017 was primarily driven from the liquidation of our Luxembourg affiliate as of March 23, 2018.

For any uncertain tax positions not meeting the “more-likely-than-not” recognition threshold, accounting standards require recognition, measurement and disclosure in a company’s financial statements. We had no material unrecognized tax benefits as of September 30, 2018 and 2017. Our United States subsidiaries are no longer subject to U.S. federal and state income tax examinations by tax authorities for years before 2015. Our United Kingdom subsidiaries are no longer subject to United Kingdom income tax examinations by Her Majesty’s Revenue and Customs for years before 2016.

Commitments and Contingencies	9 Months Ended
Commitments and Contingencies	Sep. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Argo Group’s subsidiaries are parties to legal actions incidental to their business. Based on the opinion of counsel, management believes that the resolution of these matters will not materially affect our financial condition or results of operations. We have contractual commitments to invest up to $113.2 million related to our limited partnership investments at September 30, 2018. These commitments will be funded as required by the partnership agreements which can be called to be fulfilled at any time, not to exceed thirteen years

Segment Information

9 Months Ended

Sep. 30, 2018

Segment Reporting [Abstract]

Segment Information

We are primarily engaged in underwriting property and casualty insurance and reinsurance. We have two ongoing reporting segments: U.S. Operations and International Operations. Additionally, we have a Run-off Lines segment for certain products that we no longer underwrite.

We consider many factors, including the nature of each segment’s insurance and reinsurance products, production sources, distribution strategies and the regulatory environment, in determining how to aggregate reporting segments. Transactions between segments are reported in the segment that initiated the transaction.

In evaluating the operating performance of our segments, we focus on core underwriting and investing results before the consideration of realized gains or losses from investments. Realized investment gains are reported as a component of the Corporate and Other segment, as decisions regarding the acquisition and disposal of securities reside with the corporate investment function and are not under the control of the individual business segments. Identifiable assets by segment are those assets used in the operation of each segment.

Revenue and income (loss) before income taxes for each segment were as follows:



	For the Three Months Ended September 30,					For the Nine Months Ended September 30,
(in millions)	2018		2017			2018		2017
Revenue:
Earned premiums
U.S. Operations	$	278.3	$	242.6		$	807.6	$	692.9
International Operations	168.5		146.8			471.4		474.9
Run-off Lines	0.1		(0.1		)	0.3		—
Total earned premiums	446.9		389.3			1,279.3		1,167.8
Net investment income
U.S. Operations	21.4		18.8			64.7		66.0
International Operations	8.4		7.7			25.6		24.4
Run-off Lines	2.1		2.0			6.3		7.0
Corporate and Other	2.6		2.4			7.1		7.6
Total net investment income	34.5		30.9			103.7		105.0
Fee and other income	3.3		13.0			7.2		20.4
Net realized investment and other gains	14.2		6.0			9.0		25.1
Total revenue	$	498.9	$	439.2		$	1,399.2	$	1,318.3



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(in millions)	2018			2017			2018			2017
Income (loss) before income taxes
U.S. Operations	$	50.3		$	28.7		$	126.8		$	118.9
International Operations	(1.2		)	(77.5		)	34.9			(60.1		)
Run-off Lines	(7.6		)	(12.7		)	(8.6		)	(16.4		)
Total segment income before taxes	41.5			(61.5		)	153.1			42.4
Corporate and Other	(10.4		)	(10.4		)	(34.7		)	(39.9		)
Net realized investment and other gains	14.2			6.0			9.0			25.1
Total income (loss) before income taxes	$	45.3		$	(65.9	)	$	127.4		$	27.6

The table below presents earned premiums by geographic location for the three and nine months ended September 30, 2018 and 2017. For this disclosure, we determine geographic location by the country of domicile of our subsidiaries that underwrite the business and not by the location of insureds or reinsureds from whom the business was generated.



	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(in millions)	2018		2017		2018		2017
United States	$	276.5	$	242.5	$	803.7	$	692.8
United Kingdom	117.2		109.1		333.3		361.2
Bermuda	23.3		23.3		64.7		72.0
Malta	18.2		2.7		39.6		5.0
All other jurisdictions	11.7		11.7		38.0		36.8
Total earned premiums	$	446.9	$	389.3	$	1,279.3	$	1,167.8

The following table represents identifiable assets:



(in millions)	September 30, 2018		December 31, 2017
U.S. Operations	$	4,616.3	$	4,298.4
International Operations	3,770.6		3,553.8
Run-off Lines	466.8		449.6
Corporate and Other	426.0		462.2
Total	$	9,279.7	$	8,764.0

Included in total assets at September 30, 2018 and December 31, 2017 are $813.9 million and $731.8 million, respectively, in assets associated with trade capital providers.

Senior Unsecured Fixed Rate Notes

9 Months Ended

Sep. 30, 2018

Debt Disclosure [Abstract]

Senior Unsecured Fixed Rate Notes

In September 2012, Argo Group (the “Parent Guarantor”), through its subsidiary Argo Group US (the “Subsidiary Issuer”), issued $143,750,000 aggregate principal amount of the Subsidiary Issuer’s 6.5% Senior Notes due September 15, 2042 (the “Notes”). The Notes are unsecured and unsubordinated obligations of the Subsidiary Issuer and rank equally in right of payment with all of the Subsidiary Issuer’s other unsecured and unsubordinated debt. The Notes are guaranteed on a full and unconditional senior unsecured basis by the Parent Guarantor. The Notes may be redeemed, for cash, in whole or in part, on or after September 15, 2017, at the Subsidiary Issuer’s option, at any time and from time to time, prior to maturity at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued but unpaid interest on the principal amount being redeemed to, but not including, the redemption date.

In accordance with ASU 2015-3, “Simplifying the Presentation of Debt Issuance Costs” (Topic 835), we present the unamortized debt issuance costs in the balance sheet as a direct deduction from the carrying value of the debt liability. At September 30, 2018 and December 31, 2017, the Notes consisted of the following:



(in millions)	September 30, 2018			December 31, 2017
Senior unsecured fixed rate notes
Principal	$	143.8		$	143.8
Less: unamortized debt issuance costs	(4.0		)	(4.2		)
Senior unsecured fixed rate notes, less unamortized debt issuance costs	$	139.8		$	139.6

In accordance with Article 10 of SEC Regulation S-X, we have elected to present condensed consolidating financial information in lieu of separate financial statements for the Subsidiary Issuer. The following tables present condensed consolidating financial information at September 30, 2018 and December 31, 2017 and for the three and nine months ended September 30, 2018 and 2017, of the Parent Guarantor and the Subsidiary Issuer. The Subsidiary Issuer is an indirect wholly-owned subsidiary of the Parent Guarantor. Investments in subsidiaries are accounted for by the Parent Guarantor under the equity method for purposes of the supplemental consolidating presentation. Earnings of subsidiaries are reflected in the Parent Guarantor’s investment accounts and earnings.

The Parent Guarantor fully and unconditionally guarantees certain of the debt of the Subsidiary Issuer. Condensed consolidating financial information of the Subsidiary Issuer is presented on a consolidated basis and consists principally of the net assets, results of operations and cash flows of operating insurance company subsidiaries.

CONDENSED CONSOLIDATING BALANCE SHEET

SEPTEMBER 30, 2018

(in millions)

(Unaudited)



	Argo Group International Holdings, Ltd (Parent Guarantor)		Argo Group US, Inc. and Subsidiaries (Subsidiary Issuer)		Other Subsidiaries and Eliminations (1)			Consolidating Adjustments (2)			Total
Assets
Investments	$	0.4	$	3,205.9	$	1,658.4		$	—		$	4,864.7
Cash	1.7		34.0		82.8			—			118.5
Accrued investment income	—		18.6		7.7			—			26.3
Premiums receivable	—		239.6		469.3			—			708.9
Reinsurance recoverables	—		1,559.7		648.5			—			2,208.2
Goodwill and other intangible assets, net	42.2		124.0		105.7			—			271.9
Deferred acquisition costs, net	—		89.9		84.7			—			174.6
Ceded unearned premiums	—		236.0		279.6			—			515.6
Other assets	8.4		193.7		188.9			—			391.0
Intercompany note receivable	—		53.0		(53.0		)	—			—
Investments in subsidiaries	1,941.9		—		—			(1,941.9		)	—
Total assets	$	1,994.6	$	5,754.4	$	3,472.6		$	(1,941.9	)	$	9,279.7
Liabilities and Shareholders' Equity
Reserves for losses and loss adjustment expenses	$	—	$	2,645.3	$	1,646.4		$	—		$	4,291.7
Unearned premiums	—		794.2		593.3			—			1,387.5
Funds held and ceded reinsurance payable, net	—		745.2		179.0			—			924.2
Debt	153.4		284.7		142.5			—			580.6
Current income taxes payable, net	—		8.9		(0.8		)	—			8.1
Deferred tax liabilities, net	—		15.5		(1.5		)	—			14.0
Accrued underwriting expenses and other liabilities	13.1		94.6		147.8			—			255.5
Due to (from) affiliates	10.0		5.3		(5.3		)	(10.0		)	—
Intercompany note payable	—		18.9		(18.9		)	—			—
Total liabilities	176.5		4,612.6		2,682.5			(10.0		)	7,461.6
Total shareholders' equity	1,818.1		1,141.8		790.1			(1,931.9		)	1,818.1
Total liabilities and shareholders' equity	$	1,994.6	$	5,754.4	$	3,472.6		$	(1,941.9	)	$	9,279.7


⁽¹⁾	Includes all other subsidiaries of Argo Group International Holdings, Ltd. and all intercompany eliminations.


⁽²⁾	Includes all Argo Group parent company eliminations.

CONDENSED CONSOLIDATING BALANCE SHEET

DECEMBER 31, 2017

(in millions)



	Argo Group International Holdings, Ltd (Parent Guarantor)		Argo Group US, Inc. and Subsidiaries (Subsidiary Issuer)			Other Subsidiaries and Eliminations (1)			Consolidating Adjustments (2)			Total
Assets
Investments	$	0.4	$	3,079.0		$	1,663.5		$	—		$	4,742.9
Cash	0.9		47.8			127.9			—			176.6
Accrued investment income	—		18.0			5.5			—			23.5
Premiums receivable	—		216.5			382.1			—			598.6
Reinsurance recoverables	—		1,487.3			606.0			—			2,093.3
Goodwill and other intangible assets, net	43.2		124.9			90.1			—			258.2
Current income taxes receivable, net	—		2.4			(1.0		)	—			1.4
Deferred acquisition costs, net	—		80.7			79.7			—			160.4
Ceded unearned premiums	—		198.5			201.0			—			399.5
Other assets	9.2		171.5			128.9			—			309.6
Intercompany note receivable	—		50.9			(50.9		)	—			—
Investments in subsidiaries	1,940.0		—			—			(1,940.0		)	—
Total assets	$	1,993.7	$	5,477.5		$	3,232.8		$	(1,940.0	)	$	8,764.0
Liabilities and Shareholders' Equity
Reserves for losses and loss adjustment expenses	$	—	$	2,483.9		$	1,717.1		$	—		$	4,201.0
Unearned premiums	—		704.0			503.7			—			1,207.7
Funds held and ceded reinsurance payable, net	—		799.4			(22.7		)	—			776.7
Long-term debt	153.4		284.5			142.8			—			580.7
Deferred tax liabilities, net	—		32.5			(1.2		)	—			31.3
Accrued underwriting expenses and other liabilities	8.9		95.0			43.0			—			146.9
Due to (from) affiliates	11.7		(0.4		)	0.4			(11.7		)	—
Total liabilities	174.0		4,398.9			2,383.1			(11.7		)	6,944.3
Total shareholders' equity	1,819.7		1,078.6			849.7			(1,928.3		)	1,819.7
Total liabilities and shareholders' equity	$	1,993.7	$	5,477.5		$	3,232.8		$	(1,940.0	)	$	8,764.0


⁽¹⁾	Includes all other subsidiaries of Argo Group International Holdings, Ltd. and all intercompany eliminations.


⁽²⁾	Includes all Argo Group parent company eliminations.

CONDENSED CONSOLIDATING STATEMENT OF INCOME

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2018

(in millions)

(Unaudited)



	Argo Group International Holdings, Ltd (Parent Guarantor)			Argo Group US, Inc. and Subsidiaries (Subsidiary Issuer)		Other Subsidiaries and Eliminations (1)			Consolidating Adjustments (2)			Total
Premiums and other revenue:
Earned premiums	$	—		$	222.9	$	224.0		$	—		$	446.9
Net investment (expense) income	(0.6		)	21.1		14.0			—			34.5
Fee and other income	—			2.2		1.1			—			3.3
Net realized investment (losses) gains	(0.3		)	16.2		(1.7		)	—			14.2
Total revenue	(0.9		)	262.4		237.4			—			498.9
Expenses:
Losses and loss adjustment expenses	—			136.9		140.6			—			277.5
Underwriting, acquisition and insurance expenses	3.3			85.0		79.7			—			168.0
Interest expense	1.6			4.6		1.7			—			7.9
Fee and other expense	—			1.2		0.7			—			1.9
Foreign currency exchange losses (gains)	—			—		(1.7		)	—			(1.7		)
Total expenses	4.9			227.7		221.0			—			453.6
(Loss) income before income taxes	(5.8		)	34.7		16.4			—			45.3
Provision for income taxes	—			4.7		—			—			4.7
Net (loss) income before equity in earnings of subsidiaries	(5.8		)	30.0		16.4			—			40.6
Equity in undistributed earnings of subsidiaries	46.4			—		—			(46.4		)	—
Net income	$	40.6		$	30.0	$	16.4		$	(46.4	)	$	40.6


⁽¹⁾	Includes all other subsidiaries of Argo Group International Holdings, Ltd. and all intercompany eliminations.


⁽²⁾	Includes all Argo Group parent company eliminations.

CONDENSED CONSOLIDATING STATEMENT OF INCOME

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2017

(in millions)

(Unaudited)



	Argo Group International Holdings, Ltd (Parent Guarantor)			Argo Group US, Inc. and Subsidiaries (Subsidiary Issuer)			Other Subsidiaries and Eliminations (1)			Consolidating Adjustments (2)		Total
Premiums and other revenue:
Earned premiums	$	—		$	145.3		$	244.0		$	—	$	389.3
Net investment (expense) income	(1.1		)	16.5			15.5			—		30.9
Fee and other income	—			12.3			0.7			—		13.0
Net realized investment gains (losses)	—			6.6			(0.6		)	—		6.0
Total revenue	(1.1		)	180.7			259.6			—		439.2
Expenses:
Losses and loss adjustment expenses	—			99.1			227.3			—		326.4
Underwriting, acquisition and insurance expenses	5.6			74.0			86.5			—		166.1
Interest expense	1.6			4.2			1.7			—		7.5
Fee and other expense	—			4.1			0.9			—		5.0
Foreign currency exchange (gains) losses	—			(0.1		)	0.2			—		0.1
Total expenses	7.2			181.3			316.6			—		505.1
(Loss) income before income taxes	(8.3		)	(0.6		)	(57.0		)	—		(65.9		)
Provision (benefit) for income taxes	—			(0.6		)	(4.0		)	—		(4.6		)
Net (loss) income before equity in earnings of subsidiaries	(8.3		)	—			(53.0		)	—		(61.3		)
Equity in undistributed earnings of subsidiaries	(53.0		)	—			—			53.0		—
Net income	$	(61.3	)	$	—		$	(53.0	)	$	53.0	$	(61.3	)


⁽¹⁾	Includes all other subsidiaries of Argo Group International Holdings, Ltd. and all intercompany eliminations.


⁽²⁾	Includes all Argo Group parent company eliminations.

CONDENSED CONSOLIDATING STATEMENT OF INCOME

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2018

(in millions)

(Unaudited)



	Argo Group International Holdings, Ltd (Parent Guarantor)			Argo Group US, Inc. and Subsidiaries (Subsidiary Issuer)		Other Subsidiaries and Eliminations (1)			Consolidating Adjustments (2)			Total
Premiums and other revenue:
Earned premiums	$	—		$	646.8	$	632.5		$	—		$	1,279.3
Net investment (expense) income	(2.0		)	62.2		43.5			—			103.7
Fee and other income	—			3.7		3.5			—			7.2
Net realized investment (losses) gains	(0.2		)	15.3		(6.1		)	—			9.0
Total revenue	(2.2		)	728.0		673.4			—			1,399.2
Expenses:
Losses and loss adjustment expenses	—			346.7		413.5			—			760.2
Underwriting, acquisition and insurance expenses	11.5			250.2		223.3			—			485.0
Interest expense	4.5			13.4		5.5			—			23.4
Fee and other expense	—			3.7		1.8			—			5.5
Foreign currency exchange losses (gains)	—			0.2		(2.5		)	—			(2.3		)
Total expenses	16.0			614.2		641.6			—			1,271.8
(Loss) income before income taxes	(18.2		)	113.8		31.8			—			127.4
Provision for income taxes	—			17.9		2.3			—			20.2
Net (loss) income before equity in earnings of subsidiaries	(18.2		)	95.9		29.5			—			107.2
Equity in undistributed earnings of subsidiaries	125.4			—		—			(125.4		)	—
Net income	$	107.2		$	95.9	$	29.5		$	(125.4	)	$	107.2


⁽¹⁾	Includes all other subsidiaries of Argo Group International Holdings, Ltd. and all intercompany eliminations.


⁽²⁾	Includes all Argo Group parent company eliminations.

CONDENSED CONSOLIDATING STATEMENT OF INCOME

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017

(in millions)

(Unaudited)



	Argo Group International Holdings, Ltd (Parent Guarantor)			Argo Group US, Inc. and Subsidiaries (Subsidiary Issuer)			Other Subsidiaries and Eliminations (1)			Consolidating Adjustments (2)			Total
Premiums and other revenue:
Earned premiums	$	—		$	411.7		$	756.1		$	—		$	1,167.8
Net investment (expense) income	(3.2		)	64.7			43.5			—			105.0
Fee and other income	—			18.0			2.4			—			20.4
Net realized investment gains (losses)	0.5			25.6			(1.0		)	—			25.1
Total revenue	(2.7		)	520.0			801.0			—			1,318.3
Expenses:
Losses and loss adjustment expenses	—			247.7			531.8			—			779.5
Underwriting, acquisition and insurance expenses	17.8			190.7			265.9			—			474.4
Interest expense	3.0			12.7			4.7			—			20.4
Fee and other expense	—			10.7			1.7			—			12.4
Foreign currency exchange losses	—			(0.1		)	4.1			—			4.0
Total expenses	20.8			461.7			808.2			—			1,290.7
(Loss) income before income taxes	(23.5		)	58.3			(7.2		)	—			27.6
Provision (benefit) for income taxes	—			13.9			(7.7		)	—			6.2
Net (loss) income before equity in earnings of subsidiaries	(23.5		)	44.4			0.5			—			21.4
Equity in undistributed earnings of subsidiaries	44.9			—			—			(44.9		)	—
Net income	$	21.4		$	44.4		$	0.5		$	(44.9	)	$	21.4


⁽¹⁾	Includes all other subsidiaries of Argo Group International Holdings, Ltd. and all intercompany eliminations.


⁽²⁾	Includes all Argo Group parent company eliminations.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2018

(in millions)

(Unaudited)



	Argo Group International Holdings, Ltd (Parent Guarantor)			Argo Group US, Inc. and Subsidiaries (Subsidiary Issuer)			Other Subsidiaries and Eliminations (1)			Consolidating Adjustments (2)		Total
Net cash flows from operating activities	$	57.7		$	151.3		$	22.0		$	—	$	231.0
Cash flows from investing activities:
Proceeds from sales of investments	—			963.2			454.0			—		1,417.2
Maturities and mandatory calls of fixed maturity investments	—			302.5			72.6			—		375.1
Purchases of investments	—			(1,346.8		)	(630.4		)	—		(1,977.2		)
Change in short-term investments and foreign regulatory deposits	—			(65.0		)	31.2			—		(33.8		)
Settlements of foreign currency exchange forward contracts	0.2			0.5			1.3			—		2.0
Cash included in acquisition of Ariscom	—			—			15.6			—		15.6
Purchases of fixed assets and other, net	(0.1		)	(38.5		)	6.4			—		(32.2		)
Cash used in investing activities	0.1			(184.1		)	(49.3		)	—		(233.3		)
Cash flows from financing activities:
Borrowing under the intercompany note	—			19.0			(19.0		)	—		—
Activity under stock incentive plans	1.0			—			—			—		1.0
Repurchase of Company's common shares	(30.0		)	—			—			—		(30.0		)
Payment of cash dividend to common shareholders	(28.0		)	—			—			—		(28.0		)
Cash used in financing activities	(57.0		)	19.0			(19.0		)	—		(57.0		)
Effect of exchange rate changes on cash	—			—			1.2			—		1.2
Change in cash	0.8			(13.8		)	(45.1		)	—		(58.1		)
Cash, beginning of year	0.9			47.8			127.9			—		176.6
Cash, end of period	$	1.7		$	34.0		$	82.8		$	—	$	118.5


⁽¹⁾	Includes all other subsidiaries of Argo Group International Holdings, Ltd. and all intercompany eliminations.


⁽²⁾	Includes all Argo Group parent company eliminations.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017

(in millions)

(Unaudited)



	Argo Group International Holdings, Ltd (Parent Guarantor)			Argo Group US, Inc. and Subsidiaries (Subsidiary Issuer)			Other Subsidiaries and Eliminations (1)			Consolidating Adjustments (2)			Total
Net cash flows from operating activities	$	11.8		$	175.3		$	65.3		$	—		$	252.4
Cash flows from investing activities:
Proceeds from sales of investments	—			652.5			625.5			—			1,278.0
Maturities and mandatory calls of fixed maturity investments	—			350.6			142.6			—			493.2
Purchases of investments	—			(1,140.8		)	(919.4		)	—			(2,060.2		)
Change in short-term investments and foreign regulatory deposits	1.8			29.6			232.8			—			264.2
Settlements of foreign currency exchange forward contracts	0.8			(5.5		)	4.7			—			—
Acquisition of Maybrooke, net of cash and cash equivalents acquired	(235.3		)	—			130.1			—			(105.2		)
Issuance of intercompany note, net	—			—			(120.0		)	120.0			—
Purchases of fixed assets and other, net	(0.1		)	(5.3		)	(30.6		)	—			(36.0		)
Cash (used in) provided by investing activities	(232.8		)	(118.9		)	65.7			120.0			(166.0		)
Cash flows from financing activities:
Additional long-term borrowings	125.0			—			—			—			125.0
Borrowing under intercompany note, net	120.0			—			—			(120.0		)	—
Activity under stock incentive plans	0.9			—			—			—			0.9
Repurchase of Company's common shares	—			(36.6		)	—			—			(36.6		)
Payment of cash dividend to common shareholders	(24.9		)	—			—			—			(24.9		)
Cash provided by (used in) financing activities	221.0			(36.6		)	—			(120.0		)	64.4
Effect of exchange rate changes on cash	—			—			(1.0		)	—			(1.0		)
Change in cash	—			19.8			130.0			—			149.8
Cash, beginning of year	—			53.7			32.3			—			86.0
Cash, end of period	$	—		$	73.5		$	162.3		$	—		$	235.8


⁽¹⁾	Includes all other subsidiaries of Argo Group International Holdings, Ltd. and all intercompany eliminations.


⁽²⁾	Includes all Argo Group parent company eliminations.

Basis of Presentation (Policies)

9 Months Ended

Sep. 30, 2018

Accounting Policies [Abstract]

Basis of Presentation

The accompanying consolidated financial statements of Argo Group International Holdings, Ltd. (“Argo Group,” “we” or the “Company”) and its subsidiaries have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. The preparation of interim financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. The major estimates reflected in our consolidated financial statements include, but are not limited to, reserves for losses and loss adjustment expenses; reinsurance recoverables, including the reinsurance recoverables allowance for doubtful accounts; estimates of written and earned premiums; reinsurance premium receivable; fair value of investments and assessment of potential impairment; valuation of goodwill and intangibles and our deferred tax asset valuation allowance. Actual results could differ from those estimates. Certain financial information that normally is included in annual financial statements, including certain financial statement footnotes, prepared in accordance with GAAP, is not required for interim reporting purposes and has been condensed or omitted. These statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2017, filed with the Securities and Exchange Commission on February 27, 2018.

Effective March 5, 2018, we acquired 100% of the capital stock of Ariscom Compagnia di Assicurazioni S.p.A. (“Ariscom”) upon its release from extraordinary administration by the Italian insurance supervisory authority (“IVASS”). The acquisition is being accounted for in accordance with Accounting Standards Codification (“ASC”) 805, “Business Combinations.” See Note 3, “Acquisition of Ariscom,” for additional discussion regarding the acquisition. The Consolidated Financial Statements as of and for the three and nine months ended September 30, 2018 and the Notes to the Consolidated Financial Statements reflect the consolidated results of Argo Group and Ariscom commencing on the date of acquisition.

The interim financial information as of, and for the three and nine months ended September 30, 2018 and 2017 is unaudited. However, in the opinion of management, the interim information includes all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of the results presented for the interim periods. The operating results for the interim periods are not necessarily indicative of the results to be expected for the full year. All significant intercompany amounts have been eliminated in consolidation.

Reclassification

Certain reclassifications have been made to financial information presented for prior years to conform to the current year’s presentation.