Arch Capital Group (ACGL) 10-K risk factor changes: FY2020 vs FY2020

See [removed: [“Competition”](#if9b8cba8e8824e0fbf80814b4357d511_34)] [added: [“Competition”](#i9aa6868b2b724c09bc653e55fc47166e_37)] in Item 1 for details on our competitors in each of the major segments we operate in.

[removed: These] consolidated entities may use their enhanced market power and broader capital base to negotiate price reductions for products and services that compete with ours, and we may experience rate declines and possibly write less business.

Demand for reinsurance is influenced significantly by the underwriting [added: results of primary insurers and prevailing general economic conditions.]

The frequency and severity of natural catastrophe [removed: activity, including hurricanes, tsunamis, tornadoes, floods and droughts,] [added: activity] has also been greater in recent years.

[removed: Man-made catastrophic] [added: Catastrophic] events [added: caused by humans] may include acts of war, acts of terrorism and political instability.

Catastrophes can [removed: also] cause losses in non-property business such as workers’ compensation or general liability.

*The impact of the COVID-19 [removed: pandemic] [added: pandemic, the shift to a COVID-19 endemic approach] and related risks could materially affect our results of operations, financial position and/or liquidity.*

| ARCH CAPITAL | | | [removed: 32] [added: 33] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

A [added: further] prolonged COVID-19 [removed: pandemic] [added: pandemic, or a shift to a COVID-19 endemic approach, may result in fundamental shifts in the global economy which] could materially and adversely impact our own employees and operations, as well as the business operations of third parties with whom we interact.

The COVID-19 pandemic has impacted our results of operations and could have a significant effect on our [added: future] business, results of operations and [removed: future] financial performance.

The impact of [removed: the] [added: an ongoing] pandemic on the financial markets may also adversely affect our ability to fund through public or private equity offerings, debt financings, and through other means at acceptable terms.

Actions of the federal, state and local government in the U.S. and other countries where we do business, to address and [removed: mitigate the impact of COVID-19, may adversely affect us.]

Some state regulators have issued orders to review insurers’ rates to determine whether [added: premium refunds are required, and regulators in other states could take similar actions.]

On June 30, 2020, as amended on September 29, 2020, [removed: and] December 4, [removed: 2020,] [added: 2020 and June 30, 2021,] the GSEs published guidance clarifying the applicability of the reduced delinquent loan charges on loans [added: (1)] with their first missed payments occurring between March 1, 2020 and March 31, [removed: 2021 in response to a hardship related to COVID-19.]

Additionally, through [removed: June 30,] [added: December 31,] 2021, the GSEs [removed: have] temporarily required eligible insurers to obtain prior approval of dividends or entering into any new arrangements or altering any existing arrangements under tax sharing and intercompany expense-sharing agreements.

[removed: We expect the] [added: The] pandemic [added: has resulted, and may continue] to result in a material increase in new defaults as borrowers fail to make timely payments on their mortgages, including as a result of increases in unemployment and entering mortgage forbearance programs that allow borrowers to defer mortgage payments, which may have an adverse impact on our results or operations.

| ARCH CAPITAL | | | [removed: 33] [added: 34] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

Changing weather patterns and climatic conditions, such as global warming, have added to the [removed: unpredictability] [added: unpredictability, severity] and frequency of natural [removed: disasters in certain parts of the world and created additional uncertainty as to future trends and exposures.][added: disasters.]

Although the loss experience of catastrophe insurers and reinsurers has historically been characterized as low frequency, [removed: there is a growing consensus today that] climate change [removed: increases] [added: has impacted] the frequency and severity of extreme weather events [removed: and,] [added: and natural catastrophes such as hurricanes, tornado activity, other windstorms, floods and wildfires] in recent [removed: years, the frequency of major catastrophes appears to have increased,] [added: years] and may continue to increase in the future.

We attempt to manage our exposure to [removed: such events] [added: these risks relating to climate change] through the use of underwriting controls, risk models, and the purchase of third-party reinsurance.

Underwriting controls can include more restrictive underwriting criteria such as higher premiums and deductibles, or losses retained, and more specifically [added: excluded policy risks.]

Our deductible in connection with a catastrophic event is determined by market capacity, pricing [removed: conditions] [added: conditions, regulatory capital requirements] and surplus preservation.

[removed: Environmental, Social and Governance and sustainability have become major topics that] [added: ESG] encompass a wide range of issues, including climate change and other environmental risks.

We are [removed: also] subject to [removed: complex and] [added: some of these] changing laws, [removed: regulation] [added: regulations] and public policy [removed: debates relating to climate change] [added: debates,] which are difficult to predict and quantify and may have an adverse impact on our business.

[removed: Changes] [added: Additionally, changes] in regulations relating to climate change or our own leadership decisions implemented as a result of assessing the impact of climate change on our business may result in an increase in the cost of doing [removed: business] [added: business,] or a decrease in premiums in certain lines of business.

| ARCH CAPITAL | | | [removed: 34] [added: 35] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

[added: To the extent that an act of terrorism is certified by the Secretary of the Treasury and aggregate] industry insured losses resulting from the act of terrorism exceeds the prescribed program trigger, our U.S. insurance operations may be covered under TRIP for up to 80% subject [removed: to a mandatory deductible of 20% of our prior year’s direct earned premium for covered property and liability coverages.]

The program trigger for calendar year [removed: 2020] [added: 2022] and any program year thereafter [added: through 2027] is $200 million.

[added: It is possible that claims in respect of events that have occurred] could exceed our claim reserves and have a material adverse effect on our results of operations, in a particular period, or [removed: our financial condition in general.]

As of December 31, [removed: 2020,] [added: 2021,] our consolidated reserves for unpaid losses and loss adjustment expenses, net of unpaid losses and loss adjustment expenses recoverable, were approximately $12.2 billion.

Any estimates and assumptions made as part of the reserving process could prove to be inaccurate due to several factors, including the fact that for certain lines of business relatively limited historical information has been reported to us through December 31, [removed: 2020.][added: 2021.]

For our U.S. mortgage insurance business, in addition to utilizing reinsurance, we have developed a proprietary risk model that simulates the maximum [added: probable] loss resulting from a severe economic event impacting the housing market.

We also seek to limit our loss exposure by geographic [removed: diversification.][added: diversification, including by pricing adjustments in our U.S. mortgage insurance business.]

Geographic [added: pricing decisions and] zone limitations involve significant underwriting judgments, including the determination of the area of the zones and the inclusion of a particular policy within a particular zone’s limits.

| ARCH CAPITAL | | | [removed: 35] [added: 36] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

[removed: Underwriting is] inherently a matter of judgment, involving important assumptions about matters that are inherently unpredictable and beyond our control, and for which historical experience and probability analysis may not provide sufficient guidance.

See [“Catastrophic Events and Severe Economic [removed: Events”](#if9b8cba8e8824e0fbf80814b4357d511_106)] [added: Events”](#i9aa6868b2b724c09bc653e55fc47166e_112)] in Item 7 for further details.

Economic conditions [added: or the impact of climate change] could also have a material impact on our ability to manage our risk aggregations through reinsurance or capital markets transactions.

Consequently, we assume a degree of credit and operational risk of those parties, and a material failure [removed: of] [added: to manage] their risks may result in material losses or damage to us.

| ARCH CAPITAL | | | [removed: 36] [added: 37] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

RISK FACTORS SUMMARY

The following is a summary description of the material risks and uncertainties to which we may be exposed.

These and other risks are more fully described after this summary description.

- We operate in a highly competitive environment.

- The insurance and reinsurance industry is highly cyclical, and we may at times experience periods characterized by excess underwriting capacity and unfavorable premium rates.

- Claims for natural and man-made catastrophic events could cause large losses and substantial volatility in our results of operations and could have a material adverse effect on our financial position and results of operations.

- The impacts of the COVID-19 pandemic, the shift to a COVID-19 endemic approach and related risks could materially affect our results of operations, financial position and/or liquidity.

- The impact of climate change will affect our loss limitation methods, such as the purchase of third party reinsurance and catastrophe risk modeling and risk selection in ways which may adversely impact our business, financial condition and results of operations.

- Our insurance and reinsurance subsidiaries are subject to supervision and regulation.

Changes to existing regulation and supervisory standards, or failure to comply with applicable requirements, could adversely affect our business and results of operations.

- We are subject to ongoing legal and policy actions around climate change which may result in additional requirements which may prompt us to shift our risk selection and business strategy away in ways which may adversely impact our results of operations.

- Our customers and policyholders may also be impacted by regulatory, technological, market or other risks relating to climate change in ways which we cannot predict with certainty and adversely impact our results of operations.

- As we continue to incorporate climate change in our business strategy, we cannot be certain that shareholders, investors and other influential environmental groups will agree with our approach, which may adversely impact our ability to raise funds in the capital markets, our share price and our results of operations.

- Governmental, regulatory and rating actions in response to the COVID-19 pandemic may adversely affect our financial performance and our ability to conduct our businesses as we have in the past.

- We could face unanticipated losses from war, terrorism, cyber-attacks, pandemics and political instability, and these or other unanticipated losses could have a material adverse effect on our financial condition and results of operations.

- Underwriting risks and reserving for losses are based on probabilities and related modeling, which are subject to inherent uncertainties.

- The availability of reinsurance, retrocessional coverage and capital market transactions to limit our exposure to risks may be limited, and counterparty credit and other risks associated with our reinsurance arrangements may result in losses which could adversely affect our financial condition and results of operations.

- We could be materially adversely affected to the extent that important third parties with whom we do business do not adequately or appropriately manage their risks, commit fraud or otherwise breach obligations owed to us.

- Emerging claim and coverage issues, including issues relating to the COVID-19 pandemic, may adversely affect our business.

- Acquisitions, the addition of new lines of insurance or reinsurance business, expansion into new geographic regions and/or entering into joint ventures or partnerships expose us to risks.

- Our information technology systems may be unable to meet the demands of customers and our workforce.

- Cyber incidents or data breaches caused by bad actors or unintentional human error impacting data, including personal data, we maintain or use during our business operations may result in regulatory fines or action, reputation damage and a disruption in our business operations.

- A downgrade in our ratings or our inability to obtain a rating for our operating insurance and reinsurance subsidiaries may adversely affect our relationships with clients and brokers and negatively impact sales of our products.

- Our ability to execute successfully our business strategy, continue to grow and innovate and offer our employees a dynamic and supportive workplace depends on the recruitment, retention and promotion of talented, agile, diverse and resilient employees at all levels of our organization.

- Exposure to credit risk inherent in certain of our business operations.

- Applicable laws and regulations relating to economic trade sanctions and foreign bribery laws.

- The U.K.’s withdrawal from the EU and the impact thereof.

Risks Relating to Financial Markets and Investments

- Adverse developments in the financial markets (including as a result of the COVID-19 pandemic) and their potential to limit our access to capital or adversely affect our policyholders, reinsurers and retrocessionaires.

- Foreign currency exchange rate fluctuation, as well as uncertainty relating to the determination of LIBOR and the replacement thereof with alternative benchmark rates.

- The determination of the amount of current expected credit losses (“CECL”) allowances taken on our investments is highly subjective and could materially impact our results of operations or financial position.

- Inability of our reinsurance subsidiaries to provide required collateral.

- The ultimate performance of the Arch MI U.S. mortgage insurance portfolio remains uncertain.

- The amount of mortgage insurance we write in the U.S. could decline, which would reduce our revenues.

- Changes to the role of the GSEs in the U.S. housing market or to GSE eligibility requirements for mortgage insurers could negatively impact our results of operations and financial condition, or reduce our operating flexibility.

- The implementation of the Basel III Capital Accord and FHFA’s Enterprise Capital Rule may adversely affect the use of mortgage insurance and CRT opportunities.

Risk Relating to Our Company

- Some of the provisions of our bye-laws and our shareholders agreement may have the effect of hindering, delaying or preventing third party takeovers or changes in management initiated by shareholders.

These provisions may also prevent our shareholders from receiving premium prices for their shares in an unsolicited takeover.

- There are regulatory limitations on the ownership and transfer of our common shares.

results of primary insurers and prevailing general economic conditions.

Conditions of the financial markets resulting from the virus may also have a negative effect on the performance of our investment portfolio.

premium refunds are required, and regulators in other states could take similar actions.

In addition, defaults related to the pandemic, if not cured, could remain in our defaulted loan inventory for a protracted period of time including due to foreclosure moratoria, potentially resulting in higher frequency (claim rate) and severity (amount of the claim) for those loans that ultimately result in a claim.

Accordingly, extended or extensive forbearance programs,

foreclosure moratoria and other changes in regulations or laws may adversely impact our mortgage insurance segment.

*Climate change, as well as increasing regulation in the area of climate change, may adversely affect our business, financial condition and results of operations.*

However, we cannot predict how legal, regulatory and/or social responses to concerns around global climate change may impact our business.

excluded policy risks.

To the extent that an act of terrorism is certified by the Secretary of the Treasury and aggregate

It is possible that claims in respect of events that have occurred

The impact of the U.K.’s withdrawal on the U.K. and European economies and the broader global economy could be significant, resulting in increased volatility and potentially lower economic growth and instability in the financial and foreign exchange markets.

operations and financial condition could be adversely affected.

to meet their obligations to us.

The uncertainty of these adjustments, and the timing of when the transition will occur may adversely affect the value of and trading market for LIBOR-based securities.

Most recently, on December 10, 2020, the Consumer Financial Protection Bureau (“CFPB”) issued its final rule amending the general qualified mortgage (“QM”) definition and eliminated the exception that all GSEs loans were deemed QM.

The General QM definition in the final rule differs from the definition of QM applicable to loans sold to FHA, creating incentives for originators to originate loans under the FHA program rather than sell loans to the GSEs.

Further, a new “Basel-like” risk-based capital rule for the GSEs was adopted by the FHFA in 2020.

The rule requires the GSEs to hold the greater of the risk-based capital amount or the leverage ratio.

The rule limits the reduction in capital for CRTs to third parties under the risk-based capital calculation and disallows any reduction for CRT to the leverage ratio.

By its terms, this rule will become fully effective only if the GSEs are released from conservatorship, though the PSPA letter agreement contractually requires compliance sooner.

If the Enterprise Capital Rule becomes fully implemented without revision, significantly higher capital requirements for the GSEs would be mandated and the opportunity for participating in CRT transactions could be reduced.

This, along with the cap on certain high-risk loans in the PSPA letter agreement with Treasury, could result in higher GSE fees and potentially smaller market share for the Enterprises and could adversely impact the demand for MI policies.

Additionally, the GSEs may amend PMIERs to align the capital requirements and reduce the recognition of CRT for eligible insurers.

Such changes could require us to contribute additional capital to Arch MI U.S. in the future and could negatively impact our results of operations and financial condition.

and for limitations on a shareholder’s right to raise proposals or nominate directors at general meetings.

that require regulatory approval of a change in control of an insurer or an insurer's holding company.

holders of such series in the event of a liquidation, dissolution or winding-up of Arch Capital.

*The impact of commitments made by the government of Bermuda in order to avoid being named on the EU’s list of non-cooperative tax jurisdictions is uncertain and could have an adverse effect on our results of operations.*

On December 5, 2017 the Council of the European Union published its list of non-cooperative jurisdictions for tax purposes (the “EU Blacklist”).

Bermuda was not named on the EU Blacklist due to commitments made by its government to improve certain “substance requirement” deficiencies that were identified by the EU during the screening process.

This commitment led to the passing of the Economic Substance Act 2018 (as amended) of Bermuda (the “ES Act”) in December 2018, which came into force on 1 January 2019.

While the the legislation remains subject to further clarification and interpretation, it is not currently possible to ascertain the steps required to ensure our continued compliance with the ES Act and makes it difficult to predict its future impact.

The final reports provide the basis for international standards for

During 2017, the EU Economic and Financial Affairs Council (“ECOFIN”) released a list of noncooperative jurisdictions for tax purposes.

The stated aim of this list, and accompanying report, was to promote good governance worldwide in order to maximize efforts to prevent tax fraud and tax evasion.

Bermuda was not on the list of non-cooperative jurisdictions, but did feature in the report (along with approximately 40 other jurisdictions) as having committed to address concerns relating to economic substance by December 31, 2018.

Any entity that must satisfy economic substance requirements but fails to do so could face automatic disclosure to competent authorities in the EU of the information filed by the entity with the Bermuda Registrar of Companies in connection with the economic substance requirements and may also face financial penalties, restriction or regulation of its business activities and/or may be struck off as a registered entity in Bermuda.

At present, the impact of these new economic substance requirements is unclear, and it is impossible to predict the nature and effect of these requirements on us.

As the legislation is new and remains subject to further clarification and interpretation, it is not currently possible to ascertain the precise impact of the ES Act.

The following is a discussion and analysis of the financial condition and results of operations for the year ended December 31, [removed: 2020] [added: 2021] and [removed: 2019.][added: 2020.]

Comparisons between [removed: 2019] [added: 2020] and [removed: 2018] [added: 2019] have been omitted from this Form 10-K, but may be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K year ended December 31, [removed: 2019] [added: 2020] filed with the SEC.

Important factors that could cause actual events or results to differ materially from those indicated in such statements are discussed in this report, including the sections entitled “[Cautionary Note Regarding Forward-Looking [removed: Statements](#if9b8cba8e8824e0fbf80814b4357d511_13),”] [added: Statements](#i9aa6868b2b724c09bc653e55fc47166e_13),”] and “[Risk [removed: Factors](#if9b8cba8e8824e0fbf80814b4357d511_46).”][added: Factors](#i9aa6868b2b724c09bc653e55fc47166e_49).”]

[removed: Arch Capital Group Ltd. (“Arch Capital” and, together with its subsidiaries, “we” or “us”) is a publicly listed Bermuda exempted company with approximately $15.8 billion in capital at December 31, 2020 and, through] [added: Through] operations in Bermuda, the United States, United Kingdom, Europe, Canada, Australia and Hong Kong, [removed: writes] [added: we write] specialty lines of property and casualty insurance and reinsurance, as well as mortgage insurance and reinsurance, on a worldwide basis.

The worldwide property casualty insurance and reinsurance industry is highly competitive and has traditionally been subject to an underwriting [removed: cycle in which a hard market (high premium rates, restrictive underwriting standards, as well as terms and conditions, and underwriting gains) is eventually followed by a soft market (low premium rates, relaxed][added: cycle.]

[removed: Property casualty market] [added: Market] conditions [added: in the property and casualty arena] may affect, among other things, the demand for our products, our ability to increase premium rates, the terms and conditions of the insurance policies we write, changes in the products offered by us or changes in our business strategy.

We continue to write a portion of our overall book in [removed: catastrophe-exposed] [added: catastrophe exposed] business, which has the potential to increase the volatility of our operating results.

Rate improvements [removed: in 2020] have enabled us to continue to expand writings in our property casualty segments as [removed: risk adjusted returns are increasingly achieved.][added: we have been for two years now.]

| ARCH CAPITAL | | | [removed: 50] [added: 57] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

[removed: Delinquencies] [added: For our U.S. primary mortgage operations, delinquencies] continue to be [removed: better] [added: lower] than our expectations at the beginning of the COVID-19 pandemic.

[removed: We remain committed to providing solutions across many offerings as the marketplace evolves, including the mortgage credit risk transfer programs initiated by government sponsored enterprises, or “GSEs.”] In addition, we enter into aggregate excess of loss mortgage reinsurance agreements with various special purpose reinsurance companies domiciled in Bermuda [removed: (the Bellemeade Agreements)] and issue mortgage insurance linked notes, increasing our protection for mortgage tail risk.

The Bellemeade structures provide approximately [removed: $4.0] [added: $4.6] billion of aggregate reinsurance [removed: coverage.][added: coverage at December 31, 2021.]

Book value per share was [removed: $30.31] [added: $33.56] at December 31, [removed: 2020,] [added: 2021,] a [removed: 14.7%] [added: 10.7%] increase from [removed: $26.42] [added: $30.31] at December 31, [removed: 2019.][added: 2020.]

| ARCH CAPITAL | | | [removed: 51] [added: 58] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

See “Comment on Non-GAAP Financial Measures.” Our Operating ROAE was [removed: 4.8%] [added: 11.5%] for [removed: 2020,] [added: 2021,] compared to [removed: 12.0%] [added: 4.8%] for [removed: 2019.][added: 2020.]

Total return is calculated on a pre-tax basis [removed: and] before investment [removed: expenses] [added: expenses,] excluding amounts reflected in the ‘other’ segment, and reflects the effect of financial market conditions along with foreign currency fluctuations.

Management uses total return on investments as a key measure of the return generated [removed: to] [added: for] Arch common shareholders on the capital held in the business, and compares the return generated by our investment portfolio against benchmark [removed: returns which we measured our portfolio against during the periods.][added: returns.]

The following table summarizes the pre-tax total return (before investment expenses) of [removed: investment] [added: investments] held by Arch compared to the benchmark return (both based in U.S. Dollars) against which we measured our portfolio during the periods:

(1) Our investment expenses were approximately [removed: 0.31%] [added: 0.32%] and [removed: 0.33%,] [added: 0.31%,] respectively, of average invested assets in [removed: 2020] [added: 2021] and [removed: 2019.][added: 2020.]

Total return for our investment portfolio outperformed the benchmark return index in [removed: 2020] [added: 2021] and reflected the impact of [added: strong returns on alternatives and equities, partially offset by low returns on our fixed income portfolio.]

At December 31, [removed: 2020,] [added: 2021,] the benchmark return index had an average credit quality of “Aa3” by Moody’s, an estimated duration of [removed: 3.02] [added: 3.14] years.

| ARCH CAPITAL | | | [removed: 52] [added: 59] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

The reconciliation of such measures to net income available to Arch common shareholders and annualized [added: net income] return on average common equity (the most directly comparable GAAP financial measures) in accordance with Regulation G is included under “Results of Operations” below.

In applying the equity method, these investments are initially recorded at cost and are subsequently adjusted based on our proportionate share of the net income or loss of the funds [added: (which include changes in the market value of the underlying securities in the funds).]

Due to these reasons, we exclude net realized gains or losses, equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or [removed: losses and] [added: losses,] transaction costs and other [added: and loss on redemption of preferred shares] from the calculation of after-tax operating income available to Arch common shareholders.

Underwriting income or loss does not incorporate items included in our corporate [removed: (non-underwriting)] segment.

While these measures are presented in [note 4, “Segment [removed: Information,”](#if9b8cba8e8824e0fbf80814b4357d511_154)] [added: Information,”](#i9aa6868b2b724c09bc653e55fc47166e_154)] to our consolidated financial statements in Item 8, they are considered non-GAAP financial measures when presented elsewhere on a consolidated basis.

The reconciliations of underwriting income or loss to income before income taxes (the most directly comparable GAAP financial measure) on a consolidated basis and a subtotal before the contribution from the ‘other’ segment, in [added: accordance with Regulation G, is shown in [note 4, “Segment Information,”](#i9aa6868b2b724c09bc653e55fc47166e_154) to our consolidated financial statements in Item 8.]

| ARCH CAPITAL | | | [removed: 53] [added: 60] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

We do not manage our assets by underwriting segment, with the exception of goodwill and intangible assets, and, accordingly, investment [added: income,] income [added: from operating affiliates] and other non-underwriting related items are not allocated to each underwriting segment.

[removed: Pursuant to generally accepted accounting principles, Watford is] considered a variable interest entity and we concluded that we [removed: are] [added: were] the primary beneficiary of [removed: Watford.][added: Somers.]

Total return is calculated on a pre-tax basis and before investment expenses, excludes amounts reflected in the ‘other’ segment, and reflects the effect of financial market conditions along with foreign currency [added: fluctuations.]

| Net income available to Arch common shareholders | | | $ | [removed: 1,363,909] [added: 2,093,405] | | | | | $ | [removed: 1,594,707] [added: 1,363,909] | |

| Net realized (gains) losses | | | [removed: (814,808)] [added: (307,466)] | | | | | | [removed: (349,848)] [added: (814,808)] | | |

| Equity in net (income) loss of investments accounted for using the equity method | | | [removed: (146,693)] [added: (366,402)] | | | | | | [removed: (123,672)] [added: (146,693)] | | |

| Net foreign exchange (gains) losses | | | [removed: 80,591] [added: (42,743)] | | | | | | [removed: 10,732] [added: 80,591] | | |

| Transaction costs and other | | | [removed: 9,964] [added: 1,199] | | | | | | [removed: 14,444] [added: 9,964] | | |

| Income tax expense (benefit) (1) | | | [removed: 64,145] [added: 41,836] | | | | | | [removed: 16,276] [added: 64,145] | | |

| After-tax operating income available to Arch common shareholders | | | $ | [removed: 557,108] [added: 1,434,930] | | | | | $ | [removed: 1,162,639] [added: 557,108] | |

| Beginning common shareholders’ equity | | | $ | [removed: 10,717,371] [added: 12,325,886] | | | | | $ | [removed: 8,659,827] [added: 10,717,371] | |

Arch Capital Group Ltd. (“Arch Capital” and, together with its subsidiaries, “we” or “us”) is a publicly listed Bermuda exempted company with approximately $16.3 billion in capital at December 31, 2021.

In that cycle, a “hard” market is evidenced by high premium rates, restrictive underwriting standards, favorable terms and conditions, and underwriting gains.

A hard market is eventually followed by

a “soft” market which has the opposite characteristics of low premium rates, relaxed underwriting standards, broader terms and conditions, and underwriting losses.

Our three areas of focus during the year have remained constant.

In our property and casualty segments we continued to focus and grow in sectors where rates allow for returns that are substantially higher than our cost of capital.

Our mortgage insurance segment has transitioned, for the most part, from forbearance to recovery and produced results that made a significant contribution to our underwriting income.

We have also continued to focus on actively managing our investments and capital to enhance our returns.

Our corporate culture of being patient in soft markets while maintaining an agile mindset is a key to our success and allows us to seize opportunities when the odds for success are more in our favor.

The 2021 year reflected the benefits of attractive pricing in almost all of our insurance markets.

As a result, we currently expect favorable market conditions to continue in 2022, partially due to the compounding of rate-on-rate increases and the rebalancing of our mix of business.

We believe that this time-tested strategy of protecting capital through soft markets and increasing our writings in hard markets gives us the best chance to generate superior risk adjusted returns over time.

As long as rate increases support returns above our required thresholds, we expect to continue to grow our writings.

The property casualty industry is facing many degrees of uncertainty, including heightened catastrophe activity, rising inflation, COVID’s ongoing influence on the global economy and perennially low interest rates.

These factors continue to influence the trajectory and market acceptance of rate increases and reinforce why we remain optimistic that improved economics in the property casualty market will be sustainable for some time.

Rate momentum remained healthy and rate increases were well above the long-term loss cost trends and have spread to more lines than last year.

Our early focus on Lloyd’s and business in the U.K. has improved our scale and our economics in this market.

Some of our business lines that were most impacted by COVID, like travel, are recapturing some of the lost volume as both business and consumer travel increases.

In reinsurance, strong growth was observed across most of our lines of business, a reflection of our diversified specialty mix of business and our larger participation in quota share reinsurance which allows us to participate in the improved premium rates of cedents more directly.

While property catastrophe rates were up broadly at January 1, 2022 renewals, the increases were not enough for us to deploy more capital into our peak zones.

However, we found many opportunities to grow in the other 93% of our reinsurance business that is specialty in nature, including property excluding property catastrophe.

Overall, the U.S. market remains competitive but rational and our mortgage business continues to generate returns on capital in the mid teens.

Outside of the U.S., we increased our writings in Australia as a result of the housing market remaining strong and due to our acquisition of Westpac’s LMI business.

We remain committed to providing solutions across many offerings as the marketplace evolves, including the mortgage credit risk transfer programs initiated by government sponsored enterprises (“GSEs”).

The growth in 2021 reflected strong underwriting returns and income from operating affiliates.

Returns for the 2021 period reflected strong underwriting returns and income from operating affiliates, while the 2020 period reflected the impact of COVID-19 on underwriting results.

| Year Ended December 31, 2021 | | | 1.90 | | % | | | | 1.20 | | % |

The loss on redemption of preferred shares related to the redemption of the Company's Series E preferred shares in September 2021 had no impact on shareholders' equity or cash flows.

Through June 30, 2021, the ‘other’ segment included the results of Somers Holdings Ltd. (formerly Watford Holdings Ltd.).

Somers Holdings Ltd. is the parent of Somers Re Ltd., a multi-line Bermuda reinsurance company (together with Somers Holdings Ltd., “Somers”).

Pursuant to GAAP, Somers was

As such, we consolidated the results of Somers in our consolidated financial statements through June 30, 2021.

In the 2020 fourth quarter, Arch Capital, Somers, and Greysbridge Ltd., a wholly-owned subsidiary of Arch Capital, entered into an Agreement and Plan of Merger (as amended, the “Merger Agreement”).

Arch Capital assigned its rights under the Merger Agreement to Greysbridge Holdings Ltd. (“Greysbridge”).

The merger and the related Greysbridge equity financing closed on July 1, 2021.

Effective July 1, 2021, Somers is wholly owned by Greysbridge, and Greysbridge is owned 40% by Arch and 30% by certain funds managed by Kelso and 30% by certain funds managed by Warburg.

Based on the governing documents of Greysbridge, we concluded that, while we retain significant influence over Greysbridge, Greysbridge does not constitute a variable interest entity.

Accordingly, effective July 1, 2021, we no longer consolidate the results of Somers in our consolidated financial statements and footnotes.

| | | | 2021 | | | | | | 2020 | | |

| Loss on redemption of preferred shares | | | 15,101 | | | | | | — | | |

underwriting standards, as well as broader terms and conditions, and underwriting losses).

From an operating perspective, our 2020 results reflected the benefits of rate improvements as all three of our underwriting segments are seeing attractive opportunities to grow at acceptable rates of return.

We know from experience that this is an opportune time to significantly expand our participation into this hardening market.

As such, we raised an additional $1.0 billion of capital in the form of long-term senior notes at the end of June 2020 and continue to deploy capital to those lines that provide the best expected returns.

In the insurance segment, our renewal rate changes increased approximately 12% in the 2020 fourth quarter and we believe that this trend of increasing rates will continue through 2021.

COVID-19 has continued to significantly impact social and economic activity in the U.S. and global markets.

We are committed to the safety of our employees, including

restricting travel and instituting an extensive work from home policy.

These actions have helped prevent a major disruption to our clients and operations.

The impact of the spread of COVID-19 has changed some of our outlook for 2021, but we are navigating this period with a strong capital base.

The extent to which COVID-19 impacts our business, results of operations and financial results depends on numerous evolving factors including, but not limited to, the magnitude and duration of COVID-19, the extent to which it will impact macroeconomic conditions, the speed of the anticipated recovery and governmental, business and individual reactions to the pandemic.

Given the continuing evolution of the COVID-19 outbreak and the response to curb its spread including the release of vaccines, we continue to not be able to estimate the future effects of the COVID-19 outbreak to our results of operations, financial condition, or liquidity.

For the 2020 period, we recorded $272 million for COVID-19 losses across our property casualty segments.

We continue to have limited information to accurately quantify our potential exposure to the pandemic in certain areas but have established IBNR reserves for occurrences based on policy terms and conditions including limits, sub-limits, and deductibles.

These reserves were recorded across a number of lines of business, such as trade credit, travel, workers compensation and property where we have limited exposure to policies that do not contain a specific pandemic exclusion and/or explicitly afford business interruption coverage under a pandemic.

Given the unusual circumstances and breadth of the pandemic, we have classified COVID-19 losses as a catastrophe.

For our U.S. primary mortgage operations, reported delinquencies were 4.19% at December 31, 2020, compared to 4.69% at September 30, 2020.

However, delinquency rates remain at elevated levels, reflecting the impact of the recession and forbearance programs under the CARES Act (including any extensions) to borrowers experiencing a hardship during COVID-19.

Forbearance allows for mortgage payments to be suspended for up to 18 months along with a suspension of foreclosures and evictions.

See “Results of Operations—Mortgage Segment” for further details on our mortgage operations.

Record mortgage originations fueled by low mortgage rates are continuing to create surges in both purchase and refinancing activity.

There remains significant uncertainty on the economy’s health and the lack of a full understanding on how COVID-19 may impact individual borrowers and, as such, caution is warranted on predicting how this will ultimately affect our results of operations.

We believe that delinquency rates could increase in the future from the current level, as additional borrowers may request

forbearance on their mortgage loans under the CARES Act.

We would record loss reserves on these delinquencies which would result in elevated levels of incurred losses over the coming quarters.

Over time, we would expect many of these delinquencies to cure and revert back to performing loans as the economy returns to a less-stressed state.

At this time, we do not have enough visibility to predictably forecast the rate at which forbearance delinquencies will be reported to us, cure or ultimately turn into claims on an annual, let alone a quarterly basis.

We are cautiously optimistic that delinquencies will continue to cure as vaccines enable economies to reopen.

Record home purchases in the U.S. in 2020 supported a 5% price appreciation nationwide while historically low interest rates accelerated housing and refinancing demand.

Our outlook for continued growth in 2021 remains positive.

For further discussion of the potential impacts of COVID-19, see [“ITEM 1A—Risk Factors”](#if9b8cba8e8824e0fbf80814b4357d511_145).

The growth in 2020 reflected strong underwriting results and investment returns.

The lower Operating ROAE for 2020 reflected impact of elevated catastrophic activity including COVID-19 on underwriting results and lower investment income than in the 2019 periods.

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Year Ended December 31, 2019 | | | 7.30 | | % | | | | 7.39 | | % |

lower interest rates on our fixed income portfolio.

The duration of our investment portfolio decreased to 3.01 years at year-end, reflecting our ongoing positioning of the portfolio towards shorter-term and high credit opportunities, as we expect the yield curve may steepen over the coming quarters.

(which include changes in the market value of the underlying securities in the funds).

accordance with Regulation G, is shown in [note 4, “Segment Information,”](#if9b8cba8e8824e0fbf80814b4357d511_154) to our consolidated financial statements in Item 8.

For the ‘other’ segment, performance is measured based on net income or loss.

| ARCH CAPITAL | | | [removed: 82] [added: 89] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

We refer you to Item 1A [“Risk [removed: Factors”](#if9b8cba8e8824e0fbf80814b4357d511_46)] [added: Factors”](#i9aa6868b2b724c09bc653e55fc47166e_49)] for a discussion of risk factors relating to our business.

Arch Capital, a publicly listed Bermuda exempted company with [removed: $15.8] [added: $16.3] billion in capital at December 31, [removed: 2020,] [added: 2021,] provides insurance, reinsurance and mortgage insurance on a worldwide basis through its wholly owned subsidiaries.

For [removed: 2020,] [added: 2021,] we wrote [removed: $7.4] [added: $9.0] billion of net premiums and reported net income available to Arch common shareholders of [removed: $1.4] [added: $2.1] billion.

Book value per share was [removed: $30.31] [added: $33.56] at December 31, [removed: 2020,] [added: 2021,] compared to [removed: $26.42] [added: $30.31] per share at December 31, [removed: 2019.][added: 2020.]

Arch Capital makes available free of charge through its website, located at [removed: www.archcapgroup.com,] [added: www.archgroup.com,] its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with, or furnished to, the [removed: SEC.][added: U.S. Securities and Exchange Commission (“SEC”).]

[added: launched an underwriting initiative to meet current and future] demand in the global insurance and reinsurance markets that included the recruitment of new management teams and an equity capital infusion of $763.2 [removed: million] [added: million,] which created a strong capital base that was unencumbered by significant pre-2002 risks.

Since then, we have attracted a proven management team with extensive industry experience and continued to build our global underwriting platform for our insurance, reinsurance and mortgage insurance [removed: and reinsurance] businesses.

Our insurance underwriting platform initially consisted of our Bermuda and U.S. operations, followed by the establishment of our United Kingdom-based carrier, Arch Insurance [removed: (UK)] [added: (U.K.)] Limited (“Arch Insurance (U.K.)”) in 2004 and Canadian operations in 2005.

In 2008, we formed Arch Reinsurance Europe Designated Activity Company (“Arch Re Europe”), our Ireland-based reinsurance company headquartered in Ireland with offices in Switzerland and the U.K. The acquisition of Barbican in [removed: November] 2019 also contributed to our reinsurance operations.

The U.S. mortgage platform was established in 2014 and expanded greatly in 2016 through the acquisition of United [added: Guaranty Corporation (“UGC”).]

| ARCH CAPITAL | | | 3 | | | [removed: 2020] [added: 2021] FORM 10-K | | |

The mortgage operations also include participation in GSE credit risk-sharing transactions and direct mortgage insurance to U.S. mortgage lenders with respect to mortgages that lenders intend to retain in portfolio or include in non-agency securitizations along with mortgage [added: insurance and] reinsurance on a global basis.

Our European business is written through our Ireland-based carrier, Arch Insurance (EU) Designated Activity Company (“Arch Insurance (EU)”), which [removed: commenced] [added: was authorized] in [removed: 2014 providing] [added: 2011 to provide] mortgage insurance products and services to the European and U.K. markets.

In [removed: January] 2019, Arch LMI Pty Ltd. (“Arch LMI”) was authorized by the Australian Prudential Regulation Authority (“APRA”) to write lenders’ mortgage insurance on a direct basis in Australia.

[removed: In 2014 we acquired approximately 11% of Watford Holdings Ltd. Watford] [added: Somers] Holdings Ltd. is the parent of [added: Somers Re Ltd. (formerly] Watford Re [removed: Ltd.,] [added: Ltd.),] a multi-line Bermuda reinsurance company (together with [removed: Watford] [added: Somers] Holdings Ltd., [removed: “Watford”).][added: “Somers”).]

[removed: In 2017, we acquired approximately 25% of Premia Holdings] Ltd. Premia Holdings Ltd. is the parent of Premia Reinsurance Ltd., a multi-line Bermuda reinsurance company (together with Premia Holdings Ltd., “Premia”).

See “Operations—Other Operations” for further details on [removed: Watford] [added: Somers, Premia] and [removed: Premia.][added: Coface.]

Repurchases under the share repurchase program may be effected from time to time in open market or privately negotiated transactions through December 31, [removed: 2021.][added: 2022.]

Since the inception of the share repurchase program in February 2007 through December 31, [removed: 2020,] [added: 2021,] Arch Capital has repurchased [removed: 389.2] [added: 420.7] million common shares for an aggregate purchase price of [removed: $4.1] [added: $5.3] billion.

At December 31, [removed: 2020,] [added: 2021,] the total remaining authorization under [added: the share repurchase program was $1.2 billion.]

During the [removed: 2020] [added: 2021] fiscal year, we repurchased [removed: 2,850,102] [added: 31,486,830] shares for an aggregate amount of [removed: $83.5 million] [added: $1.23 billion] under our share repurchase program.

We classify our businesses into three underwriting segments– insurance, reinsurance and [removed: mortgage–and] [added: mortgage and] two [removed: other] operating [removed: segments–‘other’ and] [added: segments–] corporate [removed: (non-underwriting).][added: and ‘other.’ For an analysis of our underwriting results by segment, see [note 4, “Segment Information,”](#i9aa6868b2b724c09bc653e55fc47166e_154) to our consolidated financial statements in Item 8 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations.”]

The global pandemic resulting from the [removed: novel] coronavirus [removed: (“COVID-19”)] [added: (including variants of the coronavirus such as Delta and Omicron, “COVID-19”)] has disrupted the global economy, causing a significant slowdown in economic activity around the world.

We have taken proactive steps to ensure the health and safety of our employees with the majority of our [removed: 4,500] [added: 5,200] employees working from home to maintain business continuity.

In the U.S., our insurance group’s principal insurance subsidiaries are Arch Insurance Company (“Arch Insurance”), Arch Specialty Insurance [removed: Company,] [added: Company (“Arch Specialty”),] Arch Indemnity [added: Insurance Company (“Arch Indemnity Insurance”)] and Arch Property & Casualty Insurance Company (“Arch P&C”).

Arch Specialty is an approved excess and surplus lines insurer in 50 states, the District of [added: Columbia, Puerto Rico and the U.S. Virgin Islands and an authorized insurer in one state.]

| ARCH CAPITAL | | | 4 | | | [removed: 2020] [added: 2021] FORM 10-K | | |

Arch Indemnity [added: Insurance] is an admitted insurer in [removed: 49] [added: 50] states and the District of Columbia.

Arch P&C, which is not currently writing business, is an admitted insurer in [removed: 36] [added: 40] states and the District of [removed: Columbia.][added: Columbia and is filing applications for admission in all remaining states where it is not yet admitted.]

Our insurance operations in Canada are conducted through Arch Insurance Canada [removed: Ltd.,] [added: Ltd. (“Arch Insurance Canada”),] a Canada domestic company which is authorized in all Canadian provinces and territories.

[removed: Arch Insurance (EU) has branches in the EU in Denmark and Italy and outside the EU in the U.K. At the end] of December 2020, Arch Insurance (U.K.) received court approval in the U.K. to transfer its legacy book of business written in the European Economic Area (“EEA”) to Arch Insurance (EU) under Part VII of the U.K. Financial Services and Markets Act 2000.

We conduct insurance operations on several platforms in the U.K., including Arch Insurance [removed: (U.K.),] [added: (U.K.) and our] Lloyd’s syndicates: Arch Syndicate 2012 (“Arch Syndicate 2012”) and Arch Syndicate 1955 (“Arch Syndicate 1955”).

AMAL also acts as managing agent for third party members of Arch Syndicate [removed: 1955, which generates fee income.][added: 1955.]

Arch U.K. conducts its operations from London and other locations in the U.K. [removed: Arch Insurance]

[removed: Our U.S.] insurance group has [removed: four] [added: five] regional offices, and the executive in charge of each region is primarily responsible for all aspects of the marketing and distribution of our insurance group’s products, including the management of broker and other producer relationships in such executive’s respective region.

Our insurance group believes that claims handling is an integral component of credibility in the market for [added: insurance products.]

| ARCH CAPITAL | | | 5 | | | [removed: 2020] [added: 2021] FORM 10-K | | |

Our insurance group writes business [added: in the U.S.] on both [removed: an] [added: a U.S.] admitted and [added: U.S.] non-admitted basis.

Our insurance group focuses on various specialty lines, as described in [note 4, “Segment [removed: Information,”](#if9b8cba8e8824e0fbf80814b4357d511_154)] [added: Information,”](#i9aa6868b2b724c09bc653e55fc47166e_154)] to our consolidated financial statements in Item 8.

[removed: One key to] this philosophy is the adherence to uniform underwriting standards across each product line that focuses on the following:

In October 2001, Arch Capital

On August 6, 2021, Arch Re Bermuda completed the acquisition of Somerset Bridge Group Limited, Southern Rock Holdings Limited and affiliates (“Somerset Group”).

The acquisition includes Somerset’s motor insurance managing general agent, distribution capabilities through direct and aggregator channels, affiliated insurer and fully integrated claims operation.

We expanded our presence in Australia in August 2021 by acquiring Westpac Lenders Mortgage Insurance Limited, another APRA-approved writer of lenders’ mortgage insurance, which has since been renamed Arch Lenders Mortgage Indemnity Ltd. (“Arch Indemnity”).

In 2014, we acquired approximately 11% of Somers Holdings Ltd. (formerly Watford Holdings Ltd.).

In the 2020 fourth quarter, Arch Capital, Somers, and Greysbridge Ltd., a wholly-owned subsidiary of Arch Capital, entered into an Agreement and Plan of Merger (as amended, the “Merger Agreement”).

The merger and the related Greysbridge equity financing closed on July 1, 2021.

In 2017, we acquired approximately 25% of Premia Holdings

In 2021, the Company completed the share purchase agreement with Natixis, a French financial services firm, to purchase 29.5% of the common equity of Coface SA (“Coface”), a France-based leader in the global trade credit insurance market.

Where possible, we have encouraged employees to return to our offices,

taking into account their health and safety, as well as our changing business practices.

Our U.S.

One key to

Reinsurance recoverables are

For a discussion of our risk management policies, see [“Management’s Discussion and Analysis of Financial Condition and Results of Operations—Summary of Critical Accounting Estimates—Ceded Reinsurance”](#i9aa6868b2b724c09bc653e55fc47166e_94) and “Risk Factors—Risks Relating to Our Industry, Business and Operations—The failure of any of the loss limitation methods we employ could have a material adverse effect on our financial condition or results of operations.”

Arch Re Bermuda has also been approved as a “certified reinsurer” in certain U.S. states that allow reduced collateral for reinsurance ceded to such reinsurers.

U.S. offices in Morristown, New Jersey.

Non-

order to compare the cedent’s historical loss experience to industry averages;

See [note 8, “Reinsurance,”](#i9aa6868b2b724c09bc653e55fc47166e_166) to our consolidated financial statements in Item 8.

In 2019, Arch LMI was authorized by APRA to write lenders’ mortgage insurance.

In August 2021, we acquired Arch Indemnity, which is also authorized by APRA to write lenders’ mortgage insurance.

management to offer mortgage insurance, reinsurance and other risk-sharing products in the U.S. and around the world.

Mae and Freddie Mac single family and multifamily risk sharing programs.

Arch Capital has assigned its rights under the Merger Agreement to Greysbridge.

The merger and the related Greysbridge equity financing closed on July 1, 2021.

Arch Re Bermuda

In 2021, the Company completed the share purchase agreement with Natixis to purchase 29.5% of the common equity of Coface.

This is a long-term, strategic investment in Coface, and fits with Arch’s efforts to develop uncorrelated sources of underwriting income.

Our companies share a focus on specialty underwriting where knowledge and expertise create value for our clients, and trade credit contributes to Arch’s specialty-driven business model.

Arch has appointed four directors to serve on the ten person board of directors of Coface.

By offering a meaningful and inclusive employee experience, we not only help people perform at their best among colleagues who care, but also support our strategy of delivering specialty products and innovative solutions to our customers in each of our business segments.

In 2021, we conducted our bi-annual employee engagement survey.

We believe the results demonstrated the success of programs, such as our employee networks, regular Company-wide “town hall” meetings and other efforts to communicate more frequently and transparently with our employees.

Our employee overall engagement score was 87%, up from 84% and 10 points over the external norm.

Our values of embracing teamwork,

Since the start of the pandemic we recognized and supported the wellness needs of our employees.

We provided additional resources including webinars with a psychologist who specializes in building resilience and continued our ArchCares program to provide financial support to employees affected by COVID-19.

An important part of our culture is building an inclusive, diverse workforce.

Importantly, our networks include significant ally representation, which underscores the inclusive behavior of our people.

In October 2001, Arch Capital launched an underwriting initiative to meet current and future

Guaranty Corporation (“UGC”) and its subsidiaries from American International Group, Inc. (“AIG”).

In the 2020 fourth quarter, we entered into agreements pursuant to which we, together with certain investment funds managed by Kelso & Company and certain investment funds managed by Warburg Pincus LLC, expect to acquire all of the common shares of Watford Holdings Ltd. in transactions expected to close in the first half of 2021, subject to customary closing conditions including regulatory and shareholder approval.

the share repurchase program was $916.5 million.

For an analysis of our underwriting results by segment, see [note 4, “Segment Information,”](#if9b8cba8e8824e0fbf80814b4357d511_154) to our consolidated financial statements in Item 8 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations.”

Columbia, Puerto Rico and the U.S. Virgin Islands and an authorized insurer in one state.

(U.K.) will be winding down branch offices in other member states of the EEA following Brexit and the expiration of the transition period negotiated between the U.K. and the EU from January 31, 2020 to December 31, 2020.

insurance products.

In the past, our insurance group also entered into contingent

Our insurance group will continue to evaluate its reinsurance requirements.

premium growth.

Facultative reinsurance is typically purchased by ceding

market.

Residential Insurance Company, which is licensed and operates in all 50 states and the District of Columbia.

Arch Insurance (EU) was licensed and authorized by the CBOI in 2011 to operate on a pan-European basis under the EU’s freedom of establishment/freedom of services rules.

Arch Underwriters Europe Limited (“Arch Underwriters Europe”), an Irish company authorized as an insurance and reinsurance intermediary by the CBOI, acts on behalf of Arch Insurance (EU) and Arch Re Europe with branch offices in the EEA in Italy and Finland and outside the EEA in Switzerland and the U.K. In January 2019, Arch LMI was authorized by APRA to write lenders’ mortgage insurance.

Prior to our 2014 acquisition, Arch Mortgage Insurance Company was the leading provider of mortgage insurance products and services to credit unions in the U.S. We broadened our customer base into national and regional banks and mortgage originators while maintaining and increasing our share of the mortgage insurance credit union market.

the future.

In 2015 we established Arch Mortgage Risk Transfer PCC Inc. (“Arch MRT”) a District of Columbia based protected cell captive insurer, licensed by District of Columbia Department of Insurance, Securities and Banking as a mortgage insurer.

Arch MRT issues direct mortgage insurance to the GSEs through incorporated protected cells and cedes 100% of the risk to GSE approved reinsurers, including Arch Re U.S. Arch MRT entered into pilot transactions with both GSEs in 2018 that continued through 2020.

Exposure to mortgage risk is monitored globally and managed through underwriting guidelines,

We also own $35.0 million in aggregate principal amount of Watford Holdings Ltd’s 6.5% senior notes and approximately 6.6% of Watford’s preference shares.

The transaction is expected to close in the first half of 2021, subject to customary closing conditions including regulatory and shareholder approval.

Our business strategy is focused on delivering specialty products and solutions to our customers in each of our operating segments, and our short- and long-term success depends on employee performance.

Therefore, helping our people excel by creating a meaningful, challenging and fulfilling employee experience is of paramount importance.

We successfully kept business operations up and running through effective collaboration, communication and resilience.

and exhibiting honesty and integrity in all that we do unite us in our unrelenting focus on providing service and solutions that make us a trusted and valued business partner.

We use clearly defined policy and procedural supports such as our Code of Business Conduct and Compliance and Ethics training programs to ensure that we are unwavering in our attention to living our values.

A key aspect in top performance is enhancing our overall diversity while ensuring that we behave inclusively.

At December 31, 2020, total investable assets held by Arch were $26.9 billion, excluding the $2.7 billion included in the ‘other’ segment (*i.e.*, attributable to Watford).

The actions and policies implemented to

We are subject to

to maintain statutory capital at least equal to the target capital level will likely result in increased regulatory oversight.

Without the approval of the BMA, Arch Re Bermuda is prohibited from reducing by 15% or more its total statutory capital as set out in its previous year’s financial statements and any application for such approval must include an affidavit stating that it will continue to meet the required margins.

*Economic Substance Act.* During 2017, the EU’s Economic and Financial Affairs Council released a list of non-cooperative jurisdictions for tax purposes.

The stated purpose of this list, and accompanying report, was to promote good governance worldwide in order to maximize efforts to prevent tax fraud and tax evasion.

Bermuda was not on the list of non-cooperative jurisdictions, but was referenced in the report (along with approximately 40 other jurisdictions) as having committed to address concerns relating to economic substance by December 31, 2018.

Under most states’ statutes

In April 2015, the GSEs published comprehensive, revised requirements, known as the Private Mortgage Insurer Eligibility Requirements or “PMIERs.” Arch MI U.S.’ ability to pay dividends is subject to prior notification and approval through June 30, 2021, pursuant to the PMIERs guidance related to COVID-19.

As a result of the

As of December 31, [removed: 2020,] [added: 2021,] we were not a party to any litigation or arbitration which is expected by management to have a material adverse effect on our results of operations and financial condition and liquidity.

| | | | For the Fiscal Year Ended | | | December 31, [removed: 2020] [added: 2021] | | | Commission File No. | | | 001-16209 | | |

[removed: ][added: ]

| Depositary shares, each representing a 1/1,000th interest in a [removed: 5.25%] [added: 4.55%] Series [removed: E] [added: G] preferred share | | | | | | [removed: ACGLP] [added: ACGLN] | | | | | | NASDAQ | | | Stock Market | | |

The aggregate market value of the voting and non-voting common equity held by non-affiliates, computed by reference to the closing price as reported by the NASDAQ Stock Market as of the last business day of the Registrant’s most recently completed second fiscal quarter, was approximately [removed: $11.3] [added: $14.3] billion.

As of February [removed: 19, 2021,] [added: 21, 2022,] there were [removed: 403,014,515] [added: 379,042,099] of the registrant’s common shares outstanding.

Portions of Part III and Part IV incorporate by reference our definitive proxy statement for the [removed: 2021] [added: 2022] annual meeting of shareholders to be filed with the Securities and Exchange Commission pursuant to Regulation 14A within 120 days after December 31, [removed: 2020.][added: 2021.]

| ITEM 1. | | | [removed: [BUSINESS](#if9b8cba8e8824e0fbf80814b4357d511_16)] [added: [BUSINESS](#i9aa6868b2b724c09bc653e55fc47166e_16)] | | | [removed: [3](#if9b8cba8e8824e0fbf80814b4357d511_16)] [added: [3](#i9aa6868b2b724c09bc653e55fc47166e_16)] | | |

| ITEM 1A. | | | [RISK [removed: FACTORS](#if9b8cba8e8824e0fbf80814b4357d511_46)] [added: FACTORS](#i9aa6868b2b724c09bc653e55fc47166e_49)] | | | [removed: [32](#if9b8cba8e8824e0fbf80814b4357d511_46)] [added: [33](#i9aa6868b2b724c09bc653e55fc47166e_49)] | | |

| ITEM 1B. | | | [UNRESOLVED STAFF [removed: COMMENTS](#if9b8cba8e8824e0fbf80814b4357d511_61)] [added: COMMENTS](#i9aa6868b2b724c09bc653e55fc47166e_67)] | | | [removed: [47](#if9b8cba8e8824e0fbf80814b4357d511_61)] [added: [54](#i9aa6868b2b724c09bc653e55fc47166e_67)] | | |

| ITEM 2. | | | [removed: [PROPERTIES](#if9b8cba8e8824e0fbf80814b4357d511_64)] [added: [PROPERTIES](#i9aa6868b2b724c09bc653e55fc47166e_70)] | | | [removed: [47](#if9b8cba8e8824e0fbf80814b4357d511_64)] [added: [54](#i9aa6868b2b724c09bc653e55fc47166e_70)] | | |

| ITEM 3. | | | [LEGAL [removed: PROCEEDINGS](#if9b8cba8e8824e0fbf80814b4357d511_67)] [added: PROCEEDINGS](#i9aa6868b2b724c09bc653e55fc47166e_73)] | | | [removed: [47](#if9b8cba8e8824e0fbf80814b4357d511_67)] [added: [54](#i9aa6868b2b724c09bc653e55fc47166e_73)] | | |

| ITEM 4. | | | [MINE SAFETY [removed: DISCLOSURES](#if9b8cba8e8824e0fbf80814b4357d511_70)] [added: DISCLOSURES](#i9aa6868b2b724c09bc653e55fc47166e_76)] | | | [removed: [47](#if9b8cba8e8824e0fbf80814b4357d511_70)] [added: [54](#i9aa6868b2b724c09bc653e55fc47166e_76)] | | |

| ITEM 5. | | | [MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED [removed: STOCKHOLDER](#if9b8cba8e8824e0fbf80814b4357d511_73) [](#if9b8cba8e8824e0fbf80814b4357d511_73)[MATTERS] [added: STOCKHOLDER](#i9aa6868b2b724c09bc653e55fc47166e_79) [MATTERS] AND ISSUER PURCHASES OF EQUITY [removed: SECURITIES](#if9b8cba8e8824e0fbf80814b4357d511_73)] [added: SECURITIES](#i9aa6868b2b724c09bc653e55fc47166e_79)] | | | [removed: [48](#if9b8cba8e8824e0fbf80814b4357d511_73)] [added: [55](#i9aa6868b2b724c09bc653e55fc47166e_79)] | | |

| ITEM 7. | | | [MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF [removed: OPERATIONS](#if9b8cba8e8824e0fbf80814b4357d511_79)] [added: OPERATIONS](#i9aa6868b2b724c09bc653e55fc47166e_85)] | | | [removed: [50](#if9b8cba8e8824e0fbf80814b4357d511_79)] [added: [57](#i9aa6868b2b724c09bc653e55fc47166e_85)] | | |

| ITEM 7A. | | | [QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET [removed: RISK](#if9b8cba8e8824e0fbf80814b4357d511_115)] [added: RISK](#i9aa6868b2b724c09bc653e55fc47166e_121)] | | | [removed: [82](#if9b8cba8e8824e0fbf80814b4357d511_115)] [added: [89](#i9aa6868b2b724c09bc653e55fc47166e_121)] | | |

| ITEM 8. | | | [FINANCIAL STATEMENTS AND SUPPLEMENTARY [removed: DATA](#if9b8cba8e8824e0fbf80814b4357d511_118)] [added: DATA](#i9aa6868b2b724c09bc653e55fc47166e_124)] | | | [removed: [83](#if9b8cba8e8824e0fbf80814b4357d511_118)] [added: [90](#i9aa6868b2b724c09bc653e55fc47166e_124)] | | |

| ITEM 9. | | | [CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL [removed: DISCLOSURE](#if9b8cba8e8824e0fbf80814b4357d511_250)] [added: DISCLOSURE](#i9aa6868b2b724c09bc653e55fc47166e_232)] | | | [removed: [160](#if9b8cba8e8824e0fbf80814b4357d511_250)] [added: [166](#i9aa6868b2b724c09bc653e55fc47166e_232)] | | |

| ITEM 9A. | | | [CONTROLS AND [removed: PROCEDURES](#if9b8cba8e8824e0fbf80814b4357d511_253)] [added: PROCEDURES](#i9aa6868b2b724c09bc653e55fc47166e_235)] | | | [removed: [160](#if9b8cba8e8824e0fbf80814b4357d511_253)] [added: [166](#i9aa6868b2b724c09bc653e55fc47166e_235)] | | |

| ITEM 9B. | | | [OTHER [removed: INFORMATION](#if9b8cba8e8824e0fbf80814b4357d511_256)] [added: INFORMATION](#i9aa6868b2b724c09bc653e55fc47166e_238)] | | | [removed: [160](#if9b8cba8e8824e0fbf80814b4357d511_256)] [added: [167](#i9aa6868b2b724c09bc653e55fc47166e_238)] | | |

| ITEM 10. | | | [DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE [removed: GOVERNANCE](#if9b8cba8e8824e0fbf80814b4357d511_259)] [added: GOVERNANCE](#i9aa6868b2b724c09bc653e55fc47166e_241)] | | | [removed: [161](#if9b8cba8e8824e0fbf80814b4357d511_259)] [added: [167](#i9aa6868b2b724c09bc653e55fc47166e_241)] | | |

| ITEM 11. | | | [EXECUTIVE [removed: COMPENSATION](#if9b8cba8e8824e0fbf80814b4357d511_262)] [added: COMPENSATION](#i9aa6868b2b724c09bc653e55fc47166e_244)] | | | [removed: [161](#if9b8cba8e8824e0fbf80814b4357d511_262)] [added: [167](#i9aa6868b2b724c09bc653e55fc47166e_244)] | | |

| ITEM 12. | | | [SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER [removed: MATTERS](#if9b8cba8e8824e0fbf80814b4357d511_265)] [added: MATTERS](#i9aa6868b2b724c09bc653e55fc47166e_247)] | | | [removed: [162](#if9b8cba8e8824e0fbf80814b4357d511_265)] [added: [168](#i9aa6868b2b724c09bc653e55fc47166e_247)] | | |

| ITEM 13. | | | [CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR [removed: INDEPENDENCE](#if9b8cba8e8824e0fbf80814b4357d511_268)] [added: INDEPENDENCE](#i9aa6868b2b724c09bc653e55fc47166e_250)] | | | [removed: [162](#if9b8cba8e8824e0fbf80814b4357d511_268)] [added: [168](#i9aa6868b2b724c09bc653e55fc47166e_250)] | | |

| ITEM 14. | | | [PRINCIPAL ACCOUNTANT FEES AND [removed: SERVICES](#if9b8cba8e8824e0fbf80814b4357d511_271)] [added: SERVICES](#i9aa6868b2b724c09bc653e55fc47166e_253)] | | | [removed: [162](#if9b8cba8e8824e0fbf80814b4357d511_271)] [added: [168](#i9aa6868b2b724c09bc653e55fc47166e_253)] | | |

| ITEM 15. | | | [EXHIBITS AND FINANCIAL STATEMENT [removed: SCHEDULES](#if9b8cba8e8824e0fbf80814b4357d511_274)] [added: SCHEDULES](#i9aa6868b2b724c09bc653e55fc47166e_256)] | | | [removed: [163](#if9b8cba8e8824e0fbf80814b4357d511_274)] [added: [169](#i9aa6868b2b724c09bc653e55fc47166e_256)] | | |

| ITEM 16. | | | [FORM 10-K [removed: SUMMARY](#if9b8cba8e8824e0fbf80814b4357d511_286)] [added: SUMMARY](#i9aa6868b2b724c09bc653e55fc47166e_271)] | | | [removed: [174](#if9b8cba8e8824e0fbf80814b4357d511_286)] [added: [180](#i9aa6868b2b724c09bc653e55fc47166e_271)] | | |

- the loss [added: and addition] of key personnel;

| ARCH CAPITAL | | | 1 | | | [removed: 2020] [added: 2021] FORM 10-K | | |

- changes in the method for determining the London Inter-bank Offered Rate (“LIBOR”) and the [removed: potential] replacement of [removed: LIBOR;][added: LIBOR with alternative benchmark rates;]

- statutory or regulatory developments, including as to tax matters and insurance and other regulatory matters such as the adoption of proposed legislation that would affect Bermuda-headquartered companies and/or Bermuda-based insurers or reinsurers and/or changes in regulations or tax laws applicable to us, our subsidiaries, brokers or customers, including [added: new guidance implementing] the Tax Cuts and Jobs Act of [removed: 2017;] [added: 2017] and [added: the possible implementation of the Organization for Economic Cooperation and Development (“OECD”) Pillar I and Pillar II initiatives; and]

| ARCH CAPITAL | | | 2 | | | [removed: 2020] [added: 2021] FORM 10-K | | |

| ITEM 6. | | | \[[RESERVED](#i9aa6868b2b724c09bc653e55fc47166e_82)\] | | | [56](#i9aa6868b2b724c09bc653e55fc47166e_82) | | |

| ITEM 9C. | | | [DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS](#i9aa6868b2b724c09bc653e55fc47166e_2268) | | | [167](#i9aa6868b2b724c09bc653e55fc47166e_2268) | | |

| ITEM 6. | | | [SELECTED FINANCIAL DATA](#if9b8cba8e8824e0fbf80814b4357d511_76) | | | [49](#if9b8cba8e8824e0fbf80814b4357d511_76) | | |

However, as we continue to develop our business, we may open additional office locations in [removed: 2021.][added: 2022.]

| ARCH CAPITAL | | | [removed: 47] [added: 54] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

As of February [removed: 19, 2021,] [added: 21, 2022,] and based on information provided to us by our transfer agent and proxy solicitor, there were [removed: 893] [added: 1,052] holders of record of our common shares (NASDAQ: ACGL) and approximately [removed: 86,000] [added: 143,000] beneficial holders of our common shares.

The following table summarizes our purchases of common shares for the [removed: 2020] [added: 2021] fourth quarter:

[removed: (2) Remaining amount available at December 31, 2020 under Arch Capital’s share repurchase authorization,] [added: Repurchases] under [removed: which repurchases] [added: this authorization] may be effected from time to time in open market or privately negotiated transactions through December 31, [removed: 2021.][added: 2022.]

| ARCH CAPITAL | | | [removed: 48] [added: 55] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

The following graph compares the cumulative total shareholder return on our common shares for each of the last five years through December 31, [removed: 2020] [added: 2021] to the cumulative total return, assuming reinvestment of dividends, of (1) S&P 500 Composite Stock Index (“S&P 500 Index”) and (2) the S&P 500 Property & Casualty Insurance Index.

[removed: ][added: ]

| | | | | | | [removed: Base Period] [added: Base .. Period.] | | | | | | | | | | | | | | | | | |

| | | | Company Name/Index | | | [removed: 12/31/15 | | |] 12/31/16 | | | 12/31/17 | | | 12/31/18 | | | 12/31/19 | | | 12/31/20 | | | [added: 12/31/21 | | |]

(2) The above graph assumes that the value of the investment was $100 on December 31, [removed: 2015.][added: 2016.]

| 10/1/2021-10/31/2021 | | | | | | 1,188,948 | | | | | | $ | 38.82 | | | | | 1,174,663 | | | | | | $ | 1,498,782 | |

| 11/1/2021-11/30/2021 | | | | | | 4,183,059 | | | | | | $ | 42.18 | | | | | 4,159,310 | | | | | | $ | 1,323,335 | |

| 12/1/2021-12/31/2021 | | | | | | 3,342,978 | | | | | | $ | 42.32 | | | | | 3,334,127 | | | | | | $ | 1,182,234 | |

| Total | | | | | | 8,714,985 | | | | | | $ | 41.78 | | | | | 8,668,100 | | | | | | $ | 1,182,234 | |

(2) Remaining amount available at December 31, 2021 under Arch Capital’s $1.5 billion share repurchase authorization, authorized by the board of directors of ACGL on October 8, 2021.

| l | | | Arch Capital Group Ltd. | | | $100.00 | | | $105.19 | | | $92.90 | | | $149.11 | | | $125.40 | | | $154.54 | | |

| n | | | S&P 500 Index | | | $100.00 | | | $121.83 | | | $116.49 | | | $153.17 | | | $181.35 | | | $233.41 | | |

| p | | | S&P 500 Property & Casualty Insurance Index | | | $100.00 | | | $122.39 | | | $116.64 | | | $146.82 | | | $157.04 | | | $187.31 | | |

| 10/1/2020-10/31/2020 | | | | | | 451 | | | | | | $ | 31.01 | | | | | — | | | | | | $ | 924,514 | |

| 11/1/2020-11/30/2020 | | | | | | 142,559 | | | | | | $ | 31.28 | | | | | — | | | | | | $ | 920,548 | |

| 12/1/2020-12/31/2020 | | | | | | 131,476 | | | | | | $ | 32.93 | | | | | — | | | | | | $ | 916,528 | |

| Total | | | | | | 274,486 | | | | | | $ | 32.07 | | | | | — | | | | | | $ | 916,528 | |

| l | | | Arch Capital Group Ltd. | | | $100.00 | | | $123.71 | | | $130.14 | | | $114.92 | | | $184.47 | | | $155.14 | | |

| n | | | S&P 500 Index | | | $100.00 | | | $111.96 | | | $136.40 | | | $130.42 | | | $171.49 | | | $203.04 | | |

| p | | | S&P 500 Property & Casualty Insurance Index | | | $100.00 | | | $115.71 | | | $141.61 | | | $134.97 | | | $169.88 | | | $181.70 | | |

ITEM 6.

SELECTED FINANCIAL DATA

| ARCH CAPITAL | | | [removed: 49] [added: 56] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

| [Report of Independent Registered Public Accounting [removed: Firm](#if9b8cba8e8824e0fbf80814b4357d511_121)] [added: Firm](#i9aa6868b2b724c09bc653e55fc47166e_127) (PCAOB ID 238[)](#i9aa6868b2b724c09bc653e55fc47166e_127)] | | | | | | [removed: [84](#if9b8cba8e8824e0fbf80814b4357d511_121)] [added: [91](#i9aa6868b2b724c09bc653e55fc47166e_127)] | | |

| [Consolidated Balance [removed: Sheets](#if9b8cba8e8824e0fbf80814b4357d511_124)] [added: Sheets](#i9aa6868b2b724c09bc653e55fc47166e_130)] | | | | | | | | |

| [Consolidated Statements of [removed: Income](#if9b8cba8e8824e0fbf80814b4357d511_130)] [added: Income](#i9aa6868b2b724c09bc653e55fc47166e_133)] | | | | | | | | |

| | | | For the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [87](#if9b8cba8e8824e0fbf80814b4357d511_130)] [added: [94](#i9aa6868b2b724c09bc653e55fc47166e_133)] | | |

| [Consolidated Statements of Comprehensive [removed: Income](#if9b8cba8e8824e0fbf80814b4357d511_133)] [added: Income](#i9aa6868b2b724c09bc653e55fc47166e_136)] | | | | | | | | |

| | | | For the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [88](#if9b8cba8e8824e0fbf80814b4357d511_133)] [added: [95](#i9aa6868b2b724c09bc653e55fc47166e_136)] | | |

| [Consolidated Statements of Changes in Shareholders’ [removed: Equity](#if9b8cba8e8824e0fbf80814b4357d511_136)] [added: Equity](#i9aa6868b2b724c09bc653e55fc47166e_139)] | | | | | | | | |

| | | | For the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [89](#if9b8cba8e8824e0fbf80814b4357d511_136)] [added: [96](#i9aa6868b2b724c09bc653e55fc47166e_139)] | | |

| [Consolidated Statements of Cash [removed: Flows](#if9b8cba8e8824e0fbf80814b4357d511_139)] [added: Flows](#i9aa6868b2b724c09bc653e55fc47166e_142)] | | | | | | | | |

| | | | For the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [90](#if9b8cba8e8824e0fbf80814b4357d511_139)] [added: [97](#i9aa6868b2b724c09bc653e55fc47166e_142)] | | |

| | | | [Note 3 - Significant Accounting [removed: Policies](#if9b8cba8e8824e0fbf80814b4357d511_148)] [added: Policies](#i9aa6868b2b724c09bc653e55fc47166e_151)] | | | [removed: [91](#if9b8cba8e8824e0fbf80814b4357d511_148)] [added: [98](#i9aa6868b2b724c09bc653e55fc47166e_151)] | | |

| | | | [Note 4 - Segment [removed: Information](#if9b8cba8e8824e0fbf80814b4357d511_154)] [added: Information](#i9aa6868b2b724c09bc653e55fc47166e_154)] | | | [removed: [100](#if9b8cba8e8824e0fbf80814b4357d511_154)] [added: [107](#i9aa6868b2b724c09bc653e55fc47166e_154)] | | |

| | | | [Note 5 - Reserve for Losses and Loss Adjustment [removed: Expenses](#if9b8cba8e8824e0fbf80814b4357d511_157)] [added: Expenses](#i9aa6868b2b724c09bc653e55fc47166e_157)] | | | [removed: [107](#if9b8cba8e8824e0fbf80814b4357d511_157)] [added: [114](#i9aa6868b2b724c09bc653e55fc47166e_157)] | | |

| | | | [Note 6 - Short Duration [removed: Contracts](#if9b8cba8e8824e0fbf80814b4357d511_160)] [added: Contracts](#i9aa6868b2b724c09bc653e55fc47166e_160)] | | | [removed: [109](#if9b8cba8e8824e0fbf80814b4357d511_160)] [added: [116](#i9aa6868b2b724c09bc653e55fc47166e_160)] | | |

| | | | [Note 7 - Allowance for Expected Credit [removed: Losses](#if9b8cba8e8824e0fbf80814b4357d511_2472)] [added: Losses](#i9aa6868b2b724c09bc653e55fc47166e_163)] | | | [removed: [123](#if9b8cba8e8824e0fbf80814b4357d511_2472)] [added: [129](#i9aa6868b2b724c09bc653e55fc47166e_163)] | | |

| | | | [removed: [Note](#if9b8cba8e8824e0fbf80814b4357d511_169) [9](#if9b8cba8e8824e0fbf80814b4357d511_169) [-] [added: [Note 9 -] Investment [removed: Information](#if9b8cba8e8824e0fbf80814b4357d511_169)] [added: Information](#i9aa6868b2b724c09bc653e55fc47166e_169)] | | | [removed: [125](#if9b8cba8e8824e0fbf80814b4357d511_169)] [added: [132](#i9aa6868b2b724c09bc653e55fc47166e_169)] | | |

| | | | [Note [removed: 1](#if9b8cba8e8824e0fbf80814b4357d511_181)[2](#if9b8cba8e8824e0fbf80814b4357d511_181) [-] [added: 12 -] VIE and Noncontrolling [removed: Interests](#if9b8cba8e8824e0fbf80814b4357d511_181)] [added: Interests](#i9aa6868b2b724c09bc653e55fc47166e_178)] | | | [removed: [138](#if9b8cba8e8824e0fbf80814b4357d511_181)] [added: [145](#i9aa6868b2b724c09bc653e55fc47166e_178)] | | |

| | | | [Note [removed: 1](#if9b8cba8e8824e0fbf80814b4357d511_187)[3](#if9b8cba8e8824e0fbf80814b4357d511_187) [-] [added: 13 -] Other Comprehensive Income [removed: (Loss)](#if9b8cba8e8824e0fbf80814b4357d511_187)] [added: (Loss)](#i9aa6868b2b724c09bc653e55fc47166e_181)] | | | [removed: [141](#if9b8cba8e8824e0fbf80814b4357d511_187)] [added: [148](#i9aa6868b2b724c09bc653e55fc47166e_181)] | | |

| | | | [Note [removed: 1](#if9b8cba8e8824e0fbf80814b4357d511_190)[4](#if9b8cba8e8824e0fbf80814b4357d511_190) [-] [added: 14 -] Earnings Per Common [removed: Share](#if9b8cba8e8824e0fbf80814b4357d511_190)] [added: Share](#i9aa6868b2b724c09bc653e55fc47166e_184)] | | | [removed: [143](#if9b8cba8e8824e0fbf80814b4357d511_190)] [added: [150](#i9aa6868b2b724c09bc653e55fc47166e_184)] | | |

| | | | [Note [removed: 1](#if9b8cba8e8824e0fbf80814b4357d511_199)[6](#if9b8cba8e8824e0fbf80814b4357d511_199) [-] [added: 16 -] Transactions with Related [removed: Parties](#if9b8cba8e8824e0fbf80814b4357d511_199)] [added: Parties](#i9aa6868b2b724c09bc653e55fc47166e_190)] | | | [removed: [146](#if9b8cba8e8824e0fbf80814b4357d511_199)] [added: [153](#i9aa6868b2b724c09bc653e55fc47166e_190)] | | |

| | | | [Note [removed: 1](#if9b8cba8e8824e0fbf80814b4357d511_205)[8](#if9b8cba8e8824e0fbf80814b4357d511_205) [-] [added: 18 -] Commitments and [removed: Contingencies](#if9b8cba8e8824e0fbf80814b4357d511_205)] [added: Contingencies](#i9aa6868b2b724c09bc653e55fc47166e_196)] | | | [removed: [147](#if9b8cba8e8824e0fbf80814b4357d511_205)] [added: [154](#i9aa6868b2b724c09bc653e55fc47166e_196)] | | |

| | | | [Note [removed: 1](#if9b8cba8e8824e0fbf80814b4357d511_208)[9](#if9b8cba8e8824e0fbf80814b4357d511_208) [-] [added: 19 -] Debt and Financing [removed: Arrangements](#if9b8cba8e8824e0fbf80814b4357d511_208)] [added: Arrangements](#i9aa6868b2b724c09bc653e55fc47166e_199)] | | | [removed: [148](#if9b8cba8e8824e0fbf80814b4357d511_208)] [added: [155](#i9aa6868b2b724c09bc653e55fc47166e_199)] | | |

| | | | [removed: [Note](#if9b8cba8e8824e0fbf80814b4357d511_214) [20](#if9b8cba8e8824e0fbf80814b4357d511_214) [-] [added: [Note 20 -] Goodwill and Intangible [removed: Assets](#if9b8cba8e8824e0fbf80814b4357d511_214)] [added: Assets](#i9aa6868b2b724c09bc653e55fc47166e_202)] | | | [removed: [150](#if9b8cba8e8824e0fbf80814b4357d511_214)] [added: [157](#i9aa6868b2b724c09bc653e55fc47166e_202)] | | |

| | | | [Note [removed: 2](#if9b8cba8e8824e0fbf80814b4357d511_226)[2](#if9b8cba8e8824e0fbf80814b4357d511_226) [-] [added: 22 -] Share-Based [removed: Compensation](#if9b8cba8e8824e0fbf80814b4357d511_226)] [added: Compensation](#i9aa6868b2b724c09bc653e55fc47166e_211)] | | | [removed: [153](#if9b8cba8e8824e0fbf80814b4357d511_226)] [added: [159](#i9aa6868b2b724c09bc653e55fc47166e_211)] | | |

| ARCH CAPITAL | | | [removed: 83] [added: 90] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

We have audited the accompanying consolidated balance sheets of Arch Capital Group Ltd. and its subsidiaries (the “Company”) as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the related consolidated statements of income, of comprehensive income, of changes in shareholders’ equity, and of cash flows for each of the three years in the period ended December 31, [removed: 2020,] [added: 2021,] including the related notes and financial statement schedules listed in the index appearing under Item 15(a)(2) (collectively referred to as the “consolidated financial statements”).

We also have audited the Company's internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in [removed: *Internal] [added: Internal] Control - Integrated [removed: Framework*] [added: Framework] (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2020,] [added: 2021,] in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in [removed: *Internal Control -] [added: Internal Control-] Integrated [removed: Framework*] [added: Framework] (2013) issued by the COSO.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United [removed: States) (PCAOB)] [added: States)(PCAOB)] and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

| ARCH CAPITAL | | | [removed: 84] [added: 91] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

As of December 31, [removed: 2020,] [added: 2021,] the Company’s total reserve for losses and loss adjustment expenses was [removed: $16.5] [added: $17.8] billion.

Ultimate losses and loss adjustment expenses are generally determined by [removed: extrapolation] [added: projection] of claim emergence and settlement patterns observed in the past that can reasonably be expected to persist into the future.

| ARCH CAPITAL | | | [removed: 85] [added: 92] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

| | | | December [removed: 31, | | | | | |] [added: 31, 2021] | | |

| | | | [added: 2021 | | | | | |] 2020 | | | | | | 2019 | | |

| Fixed maturities available for sale, at fair value (amortized cost: [removed: $18,143,305] [added: $17,973,823] and [removed: $16,598,808;] [added: $18,143,305;] net of allowance for credit losses: [removed: $2,397 at December 31, 2020)] [added: $2,883 and $2,397)] | | | $ | [removed: 18,717,825] [added: 17,998,109] | | | | | $ | [removed: 16,894,526] [added: 18,717,825] | |

| Short-term investments available for sale, at fair value (amortized cost: [removed: $1,924,292] [added: $1,734,738] and [removed: $957,283;] [added: $1,924,292;] net of allowance for credit losses: $0 [removed: at December 31, 2020)] [added: and $0 )] | | | [removed: 1,924,922] [added: 1,734,716] | | | | | | [removed: 956,546] [added: 1,924,922] | | |

| Collateral received under securities lending, at fair value (amortized cost: [removed: $301,089] [added: $0] and [removed: $388,366)] [added: $301,089)] | | | [removed: 301,096] [added: —] | | | | | | [removed: 388,376] [added: 301,096] | | |

| Equity securities, at fair value | | | [removed: 1,444,830] [added: 1,804,170] | | | | | | [removed: 838,925] [added: 1,444,830] | | |

| | | | At December 31, 2021 and December 31, 2020 | | | [93](#i9aa6868b2b724c09bc653e55fc47166e_130) | | |

| | | | [Note 1 - General](#i9aa6868b2b724c09bc653e55fc47166e_145) | | | [98](#i9aa6868b2b724c09bc653e55fc47166e_145) | | |

| | | | [Note 2 - Acquisitions](#i9aa6868b2b724c09bc653e55fc47166e_148) | | | [98](#i9aa6868b2b724c09bc653e55fc47166e_148) | | |

| | | | [Note 8 - Reinsurance](#i9aa6868b2b724c09bc653e55fc47166e_166) | | | [130](#i9aa6868b2b724c09bc653e55fc47166e_166) | | |

| | | | [Note 10 - Fair Value](#i9aa6868b2b724c09bc653e55fc47166e_172) | | | [138](#i9aa6868b2b724c09bc653e55fc47166e_172) | | |

| | | | [Note 11 - Derivative Instruments](#i9aa6868b2b724c09bc653e55fc47166e_175) | | | [144](#i9aa6868b2b724c09bc653e55fc47166e_175) | | |

| | | | [Note 15 - Income Taxes](#i9aa6868b2b724c09bc653e55fc47166e_187) | | | [150](#i9aa6868b2b724c09bc653e55fc47166e_187) | | |

| | | | [Note 17 - Leases](#i9aa6868b2b724c09bc653e55fc47166e_193) | | | [154](#i9aa6868b2b724c09bc653e55fc47166e_193) | | |

| | | | [Note 21 - Shareholders’ Equity](#i9aa6868b2b724c09bc653e55fc47166e_205) | | | [158](#i9aa6868b2b724c09bc653e55fc47166e_205) | | |

| | | | [Note 23 - Retirement Plans](#i9aa6868b2b724c09bc653e55fc47166e_214) | | | [162](#i9aa6868b2b724c09bc653e55fc47166e_214) | | |

| | | | [Note 24 - Legal Proceedings](#i9aa6868b2b724c09bc653e55fc47166e_217) | | | [162](#i9aa6868b2b724c09bc653e55fc47166e_217) | | |

| | | | [Note 25 - Statutory Information](#i9aa6868b2b724c09bc653e55fc47166e_220) | | | [162](#i9aa6868b2b724c09bc653e55fc47166e_220) | | |

| | | | [Note 26 - Subsequent Events](#i9aa6868b2b724c09bc653e55fc47166e_229) | | | [165](#i9aa6868b2b724c09bc653e55fc47166e_229) | | |

February 25, 2022

| | | | 2021 | | | | | | 2020 | | |

| Cash | | | 858,668 | | | | | | 906,448 | | |

| Investment in operating affiliates | | | 1,135,655 | | | | | | 129,291 | | |

| Other assets | | | 2,453,849 | | | | | | 1,724,288 | | |

| Total revenues | | | 9,249,980 | | | | | | 8,508,509 | | | | | | 6,925,967 | | |

| Income before income taxes and income (loss) from operating affiliates | | | 2,103,351 | | | | | | 1,560,783 | | | | | | 1,846,877 | | |

| Income (loss) from operating affiliates | | | 264,693 | | | | | | 16,766 | | | | | | 2,233 | | |

| Issue costs on preferred shares issued | | | (14,179) | | | | | | — | | | | | | — | | |

| Reversal of issue costs on preferred shares redeemed | | | 15,101 | | | | | | — | | | | | | — | | |

| Net (income) loss attributable to noncontrolling interests | | | (82,613) | | | | | | (60,190) | | | | | | (56,981) | | |

| Foreign currency translation adjustments | | | (64,482) | | | | | | 33,336 | | | | | | 18,110 | | |

| Net income | | | $ | 2,239,462 | | | | | $ | 1,465,711 | | | | | $ | 1,693,300 | |

| Amortization of intangible assets | | | 82,955 | | | | | | 69,031 | | | | | | 82,104 | | |

| Purchase of operating affiliate | | | (753,916) | | | | | | — | | | | | | — | | |

| Impact of the deconsolidation of the variable interest entity | | | (349,202) | | | | | | — | | | | | | — | | |

| Proceeds from issuance of preferred shares, net | | | 485,821 | | | | | | — | | | | | | — | | |

| Redemption of preferred shares | | | (450,000) | | | | | | — | | | | | | — | | |

Based on the governing documents of Greysbridge, the Company concluded that, while it retains significant influence over Somers, Somers no longer constitutes a variable interest entity.

Accordingly, effective July 1, 2021, Arch no longer consolidates the results of Somers in its consolidated financial statements and footnotes.

The Company has reclassified the presentation of certain prior year information to conform to the current presentation, including the correct presentation of ‘income (loss) from operating affiliates’ on its consolidated statements of income for all periods presented to reclass such item from ‘other income (loss)’.

The Company also changed its presentation of ‘investment in operating affiliates’ on its consolidated balance sheet for all periods presented to reclass such item from ‘other assets’.

Management views the impact of the prior period misclassification as not material to the financial statements on a quantitative and qualitative basis.

Tabular amounts are in U.S. Dollars in thousands, except share amounts, unless otherwise noted.

Acquisitions

Westpac Lenders Mortgage Insurance Limited (“WLMI”)

On August 31, 2021, the Company completed the acquisition of WLMI, an Australian Prudential Regulation Authority authorized captive lenders mortgage insurance (“LMI”) provider to the Westpac Banking Corporation (“Westpac”).

| | | | At December 31, 2020 and December 31, 2019 | | | [86](#if9b8cba8e8824e0fbf80814b4357d511_124) | | |

| | | | [Note 1 - General](#if9b8cba8e8824e0fbf80814b4357d511_142) | | | [91](#if9b8cba8e8824e0fbf80814b4357d511_142) | | |

| | | | [Note 2 - Businesses Acquired](#if9b8cba8e8824e0fbf80814b4357d511_145) | | | [91](#if9b8cba8e8824e0fbf80814b4357d511_145) | | |

| | | | [Note](#if9b8cba8e8824e0fbf80814b4357d511_163) [8](#if9b8cba8e8824e0fbf80814b4357d511_163) [- Reinsurance](#if9b8cba8e8824e0fbf80814b4357d511_163) | | | [123](#if9b8cba8e8824e0fbf80814b4357d511_163) | | |

| | | | [Note](#if9b8cba8e8824e0fbf80814b4357d511_175) [10](#if9b8cba8e8824e0fbf80814b4357d511_175) [- Fair Value](#if9b8cba8e8824e0fbf80814b4357d511_175) | | | [130](#if9b8cba8e8824e0fbf80814b4357d511_175) | | |

| | | | [Note 1](#if9b8cba8e8824e0fbf80814b4357d511_178)[1](#if9b8cba8e8824e0fbf80814b4357d511_178) [- Derivative Instruments](#if9b8cba8e8824e0fbf80814b4357d511_178) | | | [137](#if9b8cba8e8824e0fbf80814b4357d511_178) | | |

| | | | [Note 1](#if9b8cba8e8824e0fbf80814b4357d511_193)[5](#if9b8cba8e8824e0fbf80814b4357d511_193) [- Income Taxes](#if9b8cba8e8824e0fbf80814b4357d511_193) | | | [143](#if9b8cba8e8824e0fbf80814b4357d511_193) | | |

| | | | [Note 1](#if9b8cba8e8824e0fbf80814b4357d511_202)[7](#if9b8cba8e8824e0fbf80814b4357d511_202) [- Leases](#if9b8cba8e8824e0fbf80814b4357d511_202) | | | [147](#if9b8cba8e8824e0fbf80814b4357d511_202) | | |

| | | | [Note 2](#if9b8cba8e8824e0fbf80814b4357d511_220)[1](#if9b8cba8e8824e0fbf80814b4357d511_220) [- Shareholders’ Equity](#if9b8cba8e8824e0fbf80814b4357d511_220) | | | [151](#if9b8cba8e8824e0fbf80814b4357d511_220) | | |

| | | | [Note 2](#if9b8cba8e8824e0fbf80814b4357d511_232)[3](#if9b8cba8e8824e0fbf80814b4357d511_232) [- Retirement Plans](#if9b8cba8e8824e0fbf80814b4357d511_232) | | | [155](#if9b8cba8e8824e0fbf80814b4357d511_232) | | |

| | | | [Note 2](#if9b8cba8e8824e0fbf80814b4357d511_235)[4](#if9b8cba8e8824e0fbf80814b4357d511_235) [- Legal Proceedings](#if9b8cba8e8824e0fbf80814b4357d511_235) | | | [156](#if9b8cba8e8824e0fbf80814b4357d511_235) | | |

| | | | [Note 2](#if9b8cba8e8824e0fbf80814b4357d511_238)[5](#if9b8cba8e8824e0fbf80814b4357d511_238) [- Statutory Information](#if9b8cba8e8824e0fbf80814b4357d511_238) | | | [156](#if9b8cba8e8824e0fbf80814b4357d511_238) | | |

| | | | [Note 2](#if9b8cba8e8824e0fbf80814b4357d511_241)[6](#if9b8cba8e8824e0fbf80814b4357d511_241) [- Unaudited Condensed Quarterly Financial Information](#if9b8cba8e8824e0fbf80814b4357d511_241) | | | [159](#if9b8cba8e8824e0fbf80814b4357d511_241) | | |

| | | | [Note 27 - Subsequent Event](#if9b8cba8e8824e0fbf80814b4357d511_247) | | | [159](#if9b8cba8e8824e0fbf80814b4357d511_247) | | |

February 26, 2021

| Other assets | | | 1,853,579 | | | | | | 1,383,788 | | |

| Total revenues | | | 8,525,275 | | | | | | 6,928,200 | | | | | | 5,450,568 | | |

| Income before income taxes | | | 1,577,549 | | | | | | 1,849,110 | | | | | | 841,772 | | |

| Convertible non-voting common equivalent preferred shares | | | | | | | | | | | | | | | | | |

| Balance at beginning of year | | | — | | | | | | — | | | | | | 489,627 | | |

| Preferred shares converted to common shares | | | — | | | | | | — | | | | | | (489,627) | | |

| Preferred shares converted to common shares | | | — | | | | | | — | | | | | | 489,608 | | |

| Cumulative effect of an accounting change | | | — | | | | | | — | | | | | | (149,794) | | |

| Balance at beginning of year, as adjusted | | | 258,486 | | | | | | (114,178) | | | | | | 7,606 | | |

ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Business Acquired

McNeil

On December 6, 2018, the Company closed the acquisition of McNeil & Co. (“McNeil”), a nationwide leader in specialized risk management and insurance programs headquartered in Cortland, New York.

Company (“AMIC”), Arch Mortgage Guaranty Company, United Guaranty Residential Insurance Company (“UGRIC”), Arch Insurance (EU) Designated Activity Company (“Arch Insurance (EU)”), Arch Insurance (UK) Limited (“Arch Insurance (U.K.)”), Lloyd’s of London syndicate: Arch Syndicate 2012 (“Arch Syndicate 2012”) and Arch Syndicate 1955 (“Arch Syndicate 1955”) and Watford.

The Company has reclassified the presentation of certain prior year information to conform to the current presentation.

timing of the reported information, an analysis and understanding of the characteristics of each line of business, and management’s judgment of the impact of various factors, including premium or loss trends, on the volume of business written and ceded to the Company.

Premiums written and earned, as well as related

Adjustments to premium estimates could be material

Estimated gross profits

Additional

the remaining portion is deferred.

services, or when such prices are not available, by reference to broker or underwriter bid indications.

Such investments are generally recorded on a one to three month lag based on the availability of reports from the investment funds.

The NAV

In connection with the filing of this Form 10-K, our management, including the Chief Executive Officer and Chief Financial Officer, conducted an evaluation, as of December 31, [removed: 2020,] [added: 2021,] for the purposes set forth in the applicable rules under the Securities and Exchange Act of 1934, as amended (the “Exchange Act”).

Our management assessed the effectiveness of our internal control over financial reporting as of December 31, [removed: 2020.][added: 2021.]

Based on our assessment, management determined that, as of December 31, [removed: 2020,] [added: 2021,] our internal control over financial reporting was effective.

The effectiveness of our internal control over financial reporting as of December 31, [removed: 2020] [added: 2021] has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report included in Item 8.

There have been no changes in internal control over financial reporting that occurred in connection with our evaluation required pursuant to Rules 13a-15 and 15d-15 under the Exchange Act during the fiscal quarter ended December 31, [removed: 2020] [added: 2021] that have materially affected, or are reasonably likely to materially affect, internal control over financial reporting.

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| ARCH CAPITAL | | | 166 | | | 2021 FORM 10-K | | |

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| ARCH CAPITAL | | | 160 | | | 2020 FORM 10-K | | |

[Table of C](#if9b8cba8e8824e0fbf80814b4357d511_10)[ontents](#if9b8cba8e8824e0fbf80814b4357d511_10)

PART III

Not applicable.

PART III

The information required by this item is incorporated by reference from the information to be included in our definitive proxy statement (“Proxy Statement”) for our annual meeting of shareholders to be held in 2021, which we intend to file with the SEC pursuant to Regulation 14A no later than 120 days after the end of the Company’s fiscal year which ended on December 31, [removed: 2020.][added: 2021.]

In addition, our code of ethics and certain other basic corporate documents, including the charters of our audit committee, compensation committee and nominating committee are posted on our [removed: website.][added: website located at www.archgroup.com.]

The information required by this item is incorporated by reference from the information to be included in the Proxy Statement which we intend to file pursuant to Regulation 14A with the SEC no later than 120 days after the end of the Company’s fiscal year ended on December 31, [removed: 2020,] [added: 2021,] which Proxy Statement is incorporated by reference.

| ARCH CAPITAL | | | [removed: 161] [added: 167] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

[Table of](#if9b8cba8e8824e0fbf80814b4357d511_10) [C](#if9b8cba8e8824e0fbf80814b4357d511_10)[ontents](#if9b8cba8e8824e0fbf80814b4357d511_10)

Other than the information set forth below, the information required by this item is incorporated by reference from the information to be included in the Proxy Statement which we intend to file pursuant to Regulation 14A with the SEC no later than 120 days after the end of the Company’s fiscal year ended on December 31, [removed: 2020,] [added: 2021,] which Proxy Statement is incorporated by reference.

The following information is as of December 31, [removed: 2020:][added: 2021:]

(1) Includes all vested and unvested stock options outstanding of [removed: 17,839,333] [added: 17,083,160] and restricted stock and performance units outstanding of [removed: 1,153,784.][added: 729,636.]

In addition, the weighted average remaining contractual life of the Company's outstanding exercisable stock options and SARs at December 31, [removed: 2020] [added: 2021] was [removed: 4.7] [added: 4.4] years.

(2) Includes [removed: 2,267,676] [added: 1,608,354] common shares remaining available for future issuance under our Employee Share Purchase Plan and [removed: 18,342,861] [added: 10,837,164] common shares remaining available for future issuance under our equity compensation plans.

In addition, [removed: 5,381,100] [added: 3,310,797] common shares, or [removed: 26.1%] [added: 26.6%] of the [removed: 20,610,537] [added: 12,445,518] common shares remaining available for future issuance may be issued in connection with full value awards (*i.e*., awards other than stock options or SARs).

| Equity compensation plans approved by security holders | | | 17,812,796 | | | | | | $ | 25.06 | | | | | 12,445,518 | | | | | |

| Total | | | 17,812,796 | | | | | | $ | 25.06 | | | | | 12,445,518 | | | (2) | | |

| Equity compensation plans approved by security holders | | | 18,993,117 | | | | | | $ | 23.32 | | | | | 20,610,537 | | | | | |

| Total | | | 18,993,117 | | | | | | $ | 23.32 | | | | | 20,610,537 | | | (2) | | |

The information required by this item is incorporated by reference from the information to be included in the Proxy Statement which we intend to file pursuant to Regulation 14A with the SEC no later than 120 days after the end of the Company’s fiscal year ended on December 31, [removed: 2020,] [added: 2021,] which Proxy Statement is incorporated by reference.

The information required by this item is incorporated by reference from the information to be included in our Proxy Statement which we intend to file pursuant to Regulation 14A with the SEC no later than 120 days after the end of the Company’s fiscal year ended on December 31, [removed: 2020,] [added: 2021,] which Proxy Statement is incorporated by reference.

| ARCH CAPITAL | | | [removed: 162] [added: 168] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

[Table of](#if9b8cba8e8824e0fbf80814b4357d511_10) [C](#if9b8cba8e8824e0fbf80814b4357d511_10)[ontents](#if9b8cba8e8824e0fbf80814b4357d511_10)

| [II. Condensed Financial Information of [removed: Registrant](#if9b8cba8e8824e0fbf80814b4357d511_2572)] [added: Registrant](#i9aa6868b2b724c09bc653e55fc47166e_259)] | | | | | |

| As of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [169](#if9b8cba8e8824e0fbf80814b4357d511_2572)] [added: [175](#i9aa6868b2b724c09bc653e55fc47166e_259)] | | |

| [III. Supplementary Insurance [removed: Information](#if9b8cba8e8824e0fbf80814b4357d511_277)] [added: Information](#i9aa6868b2b724c09bc653e55fc47166e_262)] | | | | | |

| For the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [172](#if9b8cba8e8824e0fbf80814b4357d511_277)] [added: [178](#i9aa6868b2b724c09bc653e55fc47166e_262)] | | |

| For the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [173](#if9b8cba8e8824e0fbf80814b4357d511_280)] [added: [179](#i9aa6868b2b724c09bc653e55fc47166e_265)] | | |

| [VI. Supplementary Information for Property and Casualty Insurance [removed: Underwriters](#if9b8cba8e8824e0fbf80814b4357d511_283)] [added: Underwriters](#i9aa6868b2b724c09bc653e55fc47166e_268)] | | | | | |

| For the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [174](#if9b8cba8e8824e0fbf80814b4357d511_283)] [added: [180](#i9aa6868b2b724c09bc653e55fc47166e_268)] | | |

| ARCH CAPITAL | | | [removed: 163] [added: 169] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

| [removed: 2.1] [added: 10.15] | | | | | | [removed: [Agreement and Plan] [added: [Employment Agreement dated as] of [removed: Merger among] [added: October 1,2019 between] Arch Capital Group [removed: Ltd., Greysbridge] Ltd. and [removed: Watford Holdings Ltd., dated October 9, 2020.](http://www.sec.gov/Archives/edgar/data/947484/000094748420000087/ex21.htm)] [added: David Gansberg †](http://www.sec.gov/Archives/edgar/data/947484/000094748420000012/ex1016.htm)] | | | | | | [removed: 8-K] [added: 10-K] | | | | | | [removed: 2.1] [added: 10.16] | | | | | | [removed: October 14,] [added: February 28,] 2020 | | | | | | | | |

| [removed: 3.1] [added: 2.1] | | | | | | [Memorandum of Association of ACGL](http://www.sec.gov/Archives/edgar/data/947484/000095016200001003/0000950162-00-001003-0001.txt) | | | | | | S-4 | | | | | | 3.1 | | | | | | September 8, 2000 | | | | | | | | |

| [removed: 3.2] [added: 2.2] | | | | | | [Bye-Laws of ACGL](http://www.sec.gov/Archives/edgar/data/947484/000094748416000061/ex3acglbye-lawsreflamend56.htm) | | | | | | 10-Q | | | | | | 3 | | | | | | August 5, 2016 | | | | | | | | |

| [removed: 3.3] [added: 2.3] | | | | | | [ACGL Certificate of Deposit of Memorandum of Increase of Share Capital](http://www.sec.gov/Archives/edgar/data/947484/000104746911001529/a2202059zex-3_3.htm) | | | | | | 10-K | | | | | | 3.3 | | | | | | February 28, 2011 | | | | | | | | |

| [removed: 4.1.1] [added: 3.1] | | | | | | [Certificate of Designations of Series [removed: E] [added: F] Non-Cumulative Preferred [removed: Shares](http://www.sec.gov/Archives/edgar/data/947484/000095016216000099/ex4_1.htm)] [added: Shares](http://www.sec.gov/Archives/edgar/data/947484/000094748417000074/ex41cert.htm)] | | | | | | 8-K | | | | | | 4.1 | | | | | | [removed: September 29, 2016] [added: August 17, 2017] | | | | | | | | |

| [removed: 4.1.2] [added: 3.2] | | | | | | [Certificate of Designations of Series [removed: F] [added: G] Non-Cumulative Preferred [removed: Shares](http://www.sec.gov/Archives/edgar/data/947484/000094748417000074/ex41cert.htm)] [added: Shares](http://www.sec.gov/Archives/edgar/data/947484/000094748421000078/exhibit41tocertificateofde.htm)] | | | | | | 8-K | | | | | | 4.1 | | | | | | [removed: August 17, 2017] [added: June 11, 2021] | | | | | | | | |

| [removed: 4.2.1] [added: 3.3] | | | | | | [Specimen Common Share Certificate](http://www.sec.gov/Archives/edgar/data/947484/000091205701506237/a2043765zex-4_1.txt) | | | | | | [removed: 10-K405] [added: 10-K] | | | | | | 4.1 | | | | | | April 2, 2001 | | | | | | | | |

| [removed: 4.2.2] [added: 3.4] | | | | | | [Specimen Series [removed: E] [added: F] Non-Cumulative Preferred Share [removed: Certificate](http://www.sec.gov/Archives/edgar/data/947484/000095016216000099/ex4_2.htm)] [added: Certificate](http://www.sec.gov/Archives/edgar/data/947484/000094748417000074/ex42formofsharecert.htm)] | | | | | | 8-K | | | | | | 4.2 | | | | | | [removed: September 29, 2016] [added: August 17, 2017] | | | | | | | | |

| [removed: 4.2.3] [added: 3.5] | | | | | | [Specimen Series [removed: F] [added: G] Non-Cumulative Preferred Share [removed: Certificate](http://www.sec.gov/Archives/edgar/data/947484/000094748417000074/ex42formofsharecert.htm)] [added: Certificate](http://www.sec.gov/Archives/edgar/data/947484/000094748421000078/exhibit42toformofsharecert.htm)] | | | | | | 8-K | | | | | | 4.2 | | | | | | [removed: August 17, 2017] [added: June 11, 2021] | | | | | | | | |

| [removed: 4.3.1] [added: 4.1] | | | | | | [Indenture, dated as of May 4, 2004, between ACGL, as issuer, and The Bank of New York Mellon, as successor trustee to JPMorgan Chase Bank, N.A. (formerly JPMorgan Chase Bank) (“JPMCB”), as trustee](http://www.sec.gov/Archives/edgar/data/947484/000104746904016436/a2136126zex-99_2.htm) | | | | | | 8-K | | | | | | 4.1 | | | | | | June 30, 2020 | | | | | | | | |

| [removed: 4.3.2] [added: 4.2] | | | | | | [First Supplemental Indenture, dated as of May 4, 2004, between ACGL, as issuer, and JPMCB, as trustee](http://www.sec.gov/Archives/edgar/data/947484/000104746904016436/a2136126zex-99_3.htm) | | | | | | 8-K | | | | | | 99.3 | | | | | | May 7, 2004 | | | | | | | | |

| [removed: 4.3.3] [added: 4.3] | | | | | | [Second Supplemental Indenture, dated as of June 30, 2020, by and between Arch Capital Group Ltd. and The Bank of New York Mellon (including the form of Global Notes for the Notes).](http://www.sec.gov/Archives/edgar/data/947484/000094748420000068/ex4263020.htm) | | | | | | 8-K | | | | | | 4.2 | | | | | | June 30, 2020 | | | | | | | | |

| 4.5.1 | | | | | | [Deposit Agreement, dated [removed: September 29, 2016,] [added: August 17, 2017,] between ACGL, as issuer, and [removed: American Stock Transfer & Trust Company, LLC (“AST”),] [added: AST,] as depositary, registrar and transfer agent and as dividend disbursing agent and redemption agent, and the holders from time to time of the depositary [removed: receipts](http://www.sec.gov/Archives/edgar/data/947484/000095016216000099/ex4_3.htm)] [added: receipts](http://www.sec.gov/Archives/edgar/data/947484/000094748417000074/ex43depositagreement.htm)] | | | | | | 8-K | | | | | | 4.3 | | | | | | [removed: September 29, 2016] [added: August 17, 2017] | | | | | | | | |

| 4.5.2 | | | | | | [Deposit Agreement, dated [removed: August 17, 2017,] [added: June 11, 2021,] between ACGL, as issuer, and AST, [removed: as depositary,] [added: as](http://www.sec.gov/Archives/edgar/data/947484/000094748421000078/exhibit43todepositagreement.htm) [](http://www.sec.gov/Archives/edgar/data/947484/000094748421000078/exhibit43todepositagreement.htm)[depositary,] registrar and transfer agent and as dividend disbursing agent and redemption agent, and the holders from time to time of the depositary [removed: receipts](http://www.sec.gov/Archives/edgar/data/947484/000094748417000074/ex43depositagreement.htm)] [added: receipts](http://www.sec.gov/Archives/edgar/data/947484/000094748421000078/exhibit43todepositagreement.htm)] | | | | | | 8-K | | | | | | 4.3 | | | | | | [removed: August 17, 2017] [added: June 11, 2021] | | | | | | | | |

| 4.6.1 | | | | | | [Form of Depositary Receipt, dated [removed: September 29, 2016](http://www.sec.gov/Archives/edgar/data/947484/000095016216000099/ex4_4.htm)] [added: August 17, 2017](http://www.sec.gov/Archives/edgar/data/947484/000094748417000074/ex44masterreceiptfordepsha.htm)] | | | | | | 8-K | | | | | | 4.4 | | | | | | [removed: September 29, 2016] [added: August 17, 2017] | | | | | | | | |

| 4.6.2 | | | | | | [Form of Depositary Receipt, dated [removed: August 17, 2017](http://www.sec.gov/Archives/edgar/data/947484/000094748417000074/ex44masterreceiptfordepsha.htm)] [added: June 11, 2021](http://www.sec.gov/Archives/edgar/data/947484/000094748421000078/exhibit44toformofdepositar.htm)] | | | | | | 8-K | | | | | | 4.4 | | | | | | [removed: August 17, 2017] [added: June 11, 2021] | | | | | | | | |

| 4.8 | | | | | | [Description of [removed: Securities](http://www.sec.gov/Archives/edgar/data/947484/000094748420000012/ex47.htm)] [added: Securities](https://www.sec.gov/Archives/edgar/data/947484/000094748422000015/ex48-descriptionofsecuriti.htm)] | | | | | | [removed: 10-K] | | | | | | [removed: 4.7] | | | | | | [removed: February 28, 2020] | | | | | | [added: X] | | |

| 10.4.1 | | | | | | [Form of Restricted Share Agreement, dated as of May 13, 2015, between ACGL and each [removed: of](http://www.sec.gov/Archives/edgar/data/947484/000094748415000027/exhibit102rsa.htm)[,] [added: of,] Marc Grandisson, [removed: W. Preston Hutchings,] Nicolas Papadopoulo, Maamoun Rajeh and Louis T. Petrillo†](http://www.sec.gov/Archives/edgar/data/947484/000094748415000027/exhibit102rsa.htm) | | | | | | 10-Q | | | | | | 10.2 | | | | | | August 7, 2015 | | | | | | | | |

| ARCH CAPITAL | | | [removed: 164] [added: 170] | | | [removed: 2020] [added: 2021] FORM 10-K | | |

| 10.4.2 | | | | | | [Form of Restricted Share Agreement, dated as of May 13, 2016, between ACGL and each [removed: of](http://www.sec.gov/Archives/edgar/data/947484/000094748416000061/ex102rsa5-13x16grants.htm) [Marc] [added: of Marc] Grandisson, [removed: W. Preston Hutchings,] Nicolas Papadopoulo, Maamoun Rajeh and Louis T. Petrillo†](http://www.sec.gov/Archives/edgar/data/947484/000094748416000061/ex102rsa5-13x16grants.htm) | | | | | | 10-Q | | | | | | 10.2 | | | | | | August 5, 2016 | | | | | | | | |

| 10.4.4 | | | | | | [Form of Restricted Share Agreement, dated as of May 8, 2017, between ACGL and each [removed: of](http://www.sec.gov/Archives/edgar/data/947484/000094748417000055/ex104rsaagreement-empl.htm) [](http://www.sec.gov/Archives/edgar/data/947484/000094748417000055/ex104rsaagreement-empl.htm)[Marc] [added: of Marc] Grandisson, [removed: W. Preston Hutchings,] Nicolas Papadopoulo, Maamoun Rajeh and Louis T. Petrillo†](http://www.sec.gov/Archives/edgar/data/947484/000094748417000055/ex104rsaagreement-empl.htm) | | | | | | 10-Q | | | | | | 10.4 | | | | | | August 4, 2017 | | | | | | | | |

| 10.6.1 | | | | | | [Form of Non-Qualified Stock Option Agreement, dated as of May 13, 2015, between ACGL and each [removed: of](http://www.sec.gov/Archives/edgar/data/947484/000094748415000027/exhibit103option.htm) [Marc Grandisson and W. Preston Hutchings†](http://www.sec.gov/Archives/edgar/data/947484/000094748415000027/exhibit103option.htm)] [added: of Marc Grandisson†](http://www.sec.gov/Archives/edgar/data/947484/000094748415000027/exhibit103option.htm)] | | | | | | 10-Q | | | | | | 10.3 | | | | | | August 7, 2015 | | | | | | | | |

| 10.6.2 | | | | | | [Form of Non-Qualified Stock Option Agreement, dated as of May 13, 2016, between ACGL and each [removed: of](http://www.sec.gov/Archives/edgar/data/947484/000094748416000061/ex103nqso5-13x16grants.htm) [Marc] [added: of Marc] Grandisson, [removed: W. Preston Hutchings,] Nicolas Papadopoulo, Maamoun Rajeh and Louis T. Petrillo†](http://www.sec.gov/Archives/edgar/data/947484/000094748416000061/ex103nqso5-13x16grants.htm) | | | | | | 10-Q | | | | | | 10.3 | | | | | | August 5, 2016 | | | | | | | | |

| 10.6.3 | | | | | | [Form of Non-Qualified Stock Option Agreement, dated as of May 8, 2017, between ACGL and each [removed: of](http://www.sec.gov/Archives/edgar/data/947484/000094748417000055/ex105optionagreement.htm) [Marc] [added: of Marc] Grandisson, [removed: W. Preston Hutchings,] Nicolas Papadopoulo, Maamoun Rajeh and Louis T. Petrillo†](http://www.sec.gov/Archives/edgar/data/947484/000094748417000055/ex105optionagreement.htm) | | | | | | 10-Q | | | | | | 10.5 | | | | | | August 4, 2017 | | | | | | | | |

| 10.7.1 | | | | | | [Form of Share Appreciation Right Agreement, dated as of May 9, 2008, between ACGL and each [removed: of](http://www.sec.gov/Archives/edgar/data/947484/000110465908069596/a08-25739_1ex10d1.htm)[,] [added: of,] John D. Vollaro, Marc [removed: Grandisson, W. Preston Hutchings] [added: Grandisson] and Louis T. Petrillo†](http://www.sec.gov/Archives/edgar/data/947484/000110465908069596/a08-25739_1ex10d1.htm) | | | | | | 10-Q | | | | | | 10.1 | | | | | | November 10, 2008 | | | | | | | | |

| 10.7.2 | | | | | | [Form of Share Appreciation Right Agreement, dated as of May 6, 2009, between ACGL and each [removed: of](http://www.sec.gov/Archives/edgar/data/947484/000104746910001560/a2196539zex-10_124.htm) [Marc Grandisson, W. Preston Hutchings] [added: of Marc Grandisson] and John D. Vollaro†](http://www.sec.gov/Archives/edgar/data/947484/000104746910001560/a2196539zex-10_124.htm) | | | | | | 10-K | | | | | | 10.12.4 | | | | | | February 26, 2010 | | | | | | | | |

| 10.7.3 | | | | | | [Form of Share Appreciation Right Agreement, dated as of May 5, 2010, between ACGL and each [removed: of](http://www.sec.gov/Archives/edgar/data/947484/000110465910056851/a10-17488_1ex10d4.htm) [Marc Grandisson, W. Preston Hutchings] [added: of Marc Grandisson] and Louis T. Petrillo†](http://www.sec.gov/Archives/edgar/data/947484/000110465910056851/a10-17488_1ex10d4.htm) | | | | | | 10-Q | | | | | | 10.4 | | | | | | November 8, 2010 | | | | | | | | |

| 10.7.5 | | | | | | [Share Appreciation Right Agreement, dated as of May 6, 2011, between ACGL and [removed: W. Preston Hutchings†](http://www.sec.gov/Archives/edgar/data/947484/000110465911062033/a11-25791_1ex10d9.htm)] [added: Louis T. Petrillo†](http://www.sec.gov/Archives/edgar/data/947484/000110465911062033/a11-25791_1ex10d12.htm)] | | | | | | 10-Q | | | | | | [removed: 10.9] [added: 10.12] | | | | | | November 8, 2011 | | | | | | | | |

| 10.7.6 | | | | | | [Share Appreciation Right Agreement, dated as of May 6, 2011, between ACGL and [removed: Louis T. Petrillo†](http://www.sec.gov/Archives/edgar/data/947484/000110465911062033/a11-25791_1ex10d12.htm)] [added: Maamoun Rajeh†](http://www.sec.gov/Archives/edgar/data/947484/000094748417000097/ex10193017.htm)] | | | | | | 10-Q | | | | | | [removed: 10.12] [added: 10.1] | | | | | | November [removed: 8, 2011] [added: 3, 2017] | | | | | | | | |

| 10.7.7 | | | | | | [Share Appreciation Right Agreement, dated as of May [removed: 6, 2011,] [added: 9, 2012] between ACGL and Maamoun [removed: Rajeh†](http://www.sec.gov/Archives/edgar/data/947484/000094748417000097/ex10193017.htm)] [added: Rajeh†](http://www.sec.gov/Archives/edgar/data/947484/000094748417000097/ex10293017.htm)] | | | | | | 10-Q | | | | | | [removed: 10.1] [added: 10.2] | | | | | | November 3, 2017 | | | | | | | | |

| [removed: 10.7.8] [added: 10.7.9] | | | | | | [Share Appreciation Right Agreement, dated as of [removed: May 9,] [added: July 1,] 2012 between ACGL and Maamoun [removed: Rajeh†](http://www.sec.gov/Archives/edgar/data/947484/000094748417000097/ex10293017.htm)] [added: Rajeh†](http://www.sec.gov/Archives/edgar/data/947484/000094748417000097/ex10493017.htm)] | | | | | | 10-Q | | | | | | [removed: 10.2] [added: 10.4] | | | | | | November 3, 2017 | | | | | | | | |

| [removed: 10.7.9] [added: 10.7.8] | | | | | | [Form of Share Appreciation Right Agreement, dated as of May 9, 2012, between ACGL and each [removed: of](http://www.sec.gov/Archives/edgar/data/947484/000110465912076528/a12-20028_1ex10d3.htm) [Marc Grandisson, W. Preston Hutchings] [added: of Marc Grandisson] and Louis T. Petrillo†](http://www.sec.gov/Archives/edgar/data/947484/000110465912076528/a12-20028_1ex10d3.htm) | | | | | | 10-Q | | | | | | 10.3 | | | | | | November 9, 2012 | | | | | | | | |

| [IV. Reinsurance](#i9aa6868b2b724c09bc653e55fc47166e_265) | | | | | |

| 10.2.3 | | | | | | [Second Amendment to Third Amended and Restated ACGL Incentive Compensation Plan](https://www.sec.gov/Archives/edgar/data/947484/000094748422000015/ex1023.htm) | | | | | | | | | | | | | | | | | | | | | | | | X | | |

| 10.19 | | | | | | [First Amendment to Third Amended and Restated Credit Agreement, dated as of](http://www.sec.gov/Archives/edgar/data/0000947484/000094748421000145/ex101amendment1tobamlcredi.htm) [](http://www.sec.gov/Archives/edgar/data/0000947484/000094748421000145/ex101amendment1tobamlcredi.htm)[August 12, 2020 by and among Arch Capital Group Ltd., the other Loan Parties party hereto, the Lenders party hereto, and Bank of America, N.A., as](http://www.sec.gov/Archives/edgar/data/0000947484/000094748421000145/ex101amendment1tobamlcredi.htm) [](http://www.sec.gov/Archives/edgar/data/0000947484/000094748421000145/ex101amendment1tobamlcredi.htm)[Administrative Agent](http://www.sec.gov/Archives/edgar/data/0000947484/000094748421000145/ex101amendment1tobamlcredi.htm). | | | | | | 10-Q | | | | | | 10.1 | | | | | | November 4, 2021 | | | | | | | | |

| 10.20 | | | | | | [The LIBOR Transition Amendment to the Third Amended and Restated Credit](http://www.sec.gov/Archives/edgar/data/0000947484/000094748421000145/ex102liboramendmenttobamlc.htm) [](http://www.sec.gov/Archives/edgar/data/0000947484/000094748421000145/ex102liboramendmenttobamlc.htm)[Agreement, dated as of September 29, 2021.](http://www.sec.gov/Archives/edgar/data/0000947484/000094748421000145/ex102liboramendmenttobamlc.htm) | | | | | | 10-Q | | | | | | 10.2 | | | | | | November 4, 2021 | | | | | | | | |

February 25, 2022

| Francis Ebong | | | Director | | | February 25, 2022 | | |

| Eileen Mallesch | | | Director | | | February 25, 2022 | | |

| * | | | | | | | | |

| * | | | | | | | | |

| | | | 2021 | | | | | | 2020 | | | | | | | | | | | | | | | | | | | | |

| Investment in operating affiliates | | | 6,877 | | | | | | 7,731 | | | | | | | | | | | | | | | | | | | | |

| Other assets | | | 9,604 | | | | | | 10,659 | | | | | | | | | | | | | | | | | | | | |

| Total revenues | | | 1,524 | | | | | | (2,057) | | | | | | 212 | | |

| Income (loss) before income taxes and income (loss) from operating affiliates | | | (129,042) | | | | | | (108,071) | | | | | | (84,644) | | |

| Proceeds from issuance of preferred shares, net | | | 485,821 | | | | | | — | | | | | | — | | |

| | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | |

| December 31, 2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Insurance | | | $378,265 | | | $9,810,622 | | | $2,937,664 | | | $3,626,468 | | | NM | | | $2,344,365 | | | $606,265 | | | $558,906 | | | $4,148,193 | | |

| Reinsurance | | | 424,390 | | | 6,878,721 | | | 2,263,264 | | | 2,840,443 | | | NM | | | 1,924,719 | | | 536,754 | | | 212,810 | | | 3,254,374 | | |

| Mortgage | | | 99,186 | | | 1,067,813 | | | 811,014 | | | 1,283,419 | | | NM | | | 56,677 | | | 97,418 | | | 194,010 | | | 1,261,068 | | |

| Other | | | | | | | | | | | | 331,968 | | | NM | | | 259,042 | | | 62,741 | | | 32,869 | | | 354,702 | | |

| Total | | | $901,841 | | | $17,757,156 | | | $6,011,942 | | | $8,082,298 | | | NM | | | $4,584,803 | | | $1,303,178 | | | $998,595 | | | $9,018,337 | | |

| | | | | | | | | |

| Insurance | | | $ | 5,833,873 | | | | | $ | (1,719,541) | | | | | $ | 33,861 | | | | | $ | 4,148,193 | | | | | 0.8 | | % |

| Reinsurance | | | 408,520 | | | | | | (1,839,556) | | | | | | 4,685,410 | | | | | | 3,254,374 | | | | | | 144.0 | | % |

| Mortgage | | | 1,213,333 | | | | | | (246,757) | | | | | | 294,492 | | | | | | 1,261,068 | | | | | | 23.4 | | % |

| Other | | | 251,106 | | | | | | (102,763) | | | | | | 206,359 | | | | | | 354,702 | | | | | | 58.2 | | % |

| Total | | | $ | 7,706,832 | | | | | $ | (3,734,150) | | | | | $ | 5,045,655 | | | | | $ | 9,018,337 | | | | | 55.9 | | % |

| | | | | | | | | |

| 2021 | | | $ | 901,841 | | $ | 17,757,156 | | $ | 55,575 | | $ | 6,011,942 | | $ | 8,082,298 | | $ | 389,118 | | $ | 4,940,987 | | $ | (356,184) | | $ | 1,303,178 | | $ | 2,826,551 | | $ | 9,018,337 | |

| [IV. Reinsurance](#if9b8cba8e8824e0fbf80814b4357d511_280) | | | | | |

[Table of](#if9b8cba8e8824e0fbf80814b4357d511_10) [C](#if9b8cba8e8824e0fbf80814b4357d511_10)[ontents](#if9b8cba8e8824e0fbf80814b4357d511_10)

| 1.1 | | | | | | [Purchase Agreement, dated as of June 23, 2020, by and among Arch Capital Group Ltd., and Wells Fargo Securities, LLC, BofA Securities, Inc., Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC, and Lloyds Securities Inc., as representatives of the underwriters named therein](http://www.sec.gov/Archives/edgar/data/947484/000094748420000061/ex11.htm)[.](http://www.sec.gov/Archives/edgar/data/947484/000094748420000061/ex11.htm) | | | | | | 8-K | | | | | | 1.1 | | | | | | June 24, 2020 | | | | | | | | |

| 2.2 | | | | | | [Amendment No. 1 to Agreement and Plan of Merger among Arch Capital Group Ltd., Greysbridge Ltd., and Watford Holdings Ltd., dated November 2, 2020.](http://www.sec.gov/Archives/edgar/data/947484/000094748420000096/william-amendmentno1to.htm)[](http://www.sec.gov/Archives/edgar/data/947484/000094748420000096/william-amendmentno1to.htm) | | | | | | 8-K | | | | | | 2.1 | | | | | | November 2, 2020 | | | | | | | | |

| 10.11 | | | | | | [Employment Agreement, dated as of September 19, 2017 between ACGL and Maamoun Rajeh†](http://www.sec.gov/Archives/edgar/data/947484/000094748417000097/ex102693017.htm) | | | | | | 10-Q | | | | | | 10.26 | | | | | | November 3, 2017 | | | | | | | | |

| 10.13 | | | | | | [Employment Agreement, dated as of May 25, 2018, between ACGL and François Morin†](http://www.sec.gov/Archives/edgar/data/947484/000094748418000049/ex10172418.htm) | | | | | | 8-K/A | | | | | | 10.1 | | | | | | July 26, 2018 | | | | | | | | |

| 10.15 | | | | | | [Employment Agreement, dated as of November 13, 2018, between Arch Capital Services Inc. and Louis Petrillo†](http://www.sec.gov/Archives/edgar/data/947484/000094748419000008/a2018ex1016.htm) | | | | | | 10-K | | | | | | 10.16 | | | | | | February 28, 2019 | | | | | | | | |

| 10.19 | | | | | | [Voting and Support Agreement among Watford Holdings Ltd., Arch Reinsurance Ltd. and Gulf Reinsurance Ltd. dated October 9, 2020.](http://www.sec.gov/Archives/edgar/data/947484/000094748420000087/ex101votingagreement.htm) | | | | | | 8-K | | | | | | 10.1 | | | | | | October 14, 2020 | | | | | | | | |

February 26, 2021

| Other assets | | | 18,390 | | | | | | 20,461 | | | | | | | | | | | | | | | | | | | | |

| Total revenues | | | (2,494) | | | | | | (550) | | | | | | 1,996 | | |

| Income tax (expense) benefit | | | — | | | | | | — | | | | | | — | | |

| Income (loss) before equity in net income of subsidiaries | | | (108,508) | | | | | | (85,406) | | | | | | (84,460) | | |

| Other | | | — | | | | | | — | | | | | | (4) | | |

| December 31, 2018 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Insurance | | | $152,360 | | | $7,093,018 | | | $1,549,183 | | | $2,205,661 | | | NM | | | $1,520,680 | | | $349,702 | | | $364,138 | | | $2,212,125 | | |

| Reinsurance | | | 166,276 | | | 3,215,909 | | | 710,774 | | | 1,261,216 | | | NM | | | 846,882 | | | 211,280 | | | 133,350 | | | 1,372,572 | | |

| Mortgage | | | 170,080 | | | 511,610 | | | 1,103,565 | | | 1,186,236 | | | NM | | | 81,289 | | | 118,595 | | | 142,432 | | | 1,157,875 | | |

| Other | | | 80,858 | | | 1,032,760 | | | 390,114 | | | 578,862 | | | NM | | | 441,255 | | | 125,558 | | | 37,889 | | | 604,175 | | |

| Total | | | $569,574 | | | $11,853,297 | | | $3,753,636 | | | $5,231,975 | | | NM | | | $2,890,106 | | | $805,135 | | | $677,809 | | | $5,346,747 | | |

| Insurance | | | $ | 3,232,234 | | | | | $ | (1,050,207) | | | | | $ | 30,098 | | | | | $ | 2,212,125 | | | | | 1.4 | | % |

| Reinsurance | | | 213,809 | | | | | | (539,950) | | | | | | 1,698,713 | | | | | | 1,372,572 | | | | | | 123.8 | | % |

| Mortgage | | | 1,139,099 | | | | | | (202,833) | | | | | | 221,609 | | | | | | 1,157,875 | | | | | | 19.1 | | % |

| Other | | | 253,760 | | | | | | (130,840) | | | | | | 481,255 | | | | | | 604,175 | | | | | | 79.7 | | % |

| Total | | | $ | 4,838,902 | | | | | $ | (1,614,257) | | | | | $ | 2,122,102 | | | | | $ | 5,346,747 | | | | | 39.7 | | % |

| 2018 | | | 569,574 | | | 11,853,297 | | | 21,145 | | | 3,753,636 | | | 5,231,975 | | | 563,633 | | | 3,162,818 | | | (272,712) | | | 805,135 | | | 2,206,164 | | | 5,346,747 | | |

| ARCH CAPITAL | | | [removed: 174] [added: 180] | | | [removed: 2020] [added: 2021] FORM 10-K | | |