Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 18, 2019 | Jun. 29, 2018 | |
Document Information [Line Items] | |||
Entity Registrant Name | AMERICAN EQUITY INVESTMENT LIFE HOLDING CO | ||
Entity Central Index Key | 1,039,828 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 3,203,746,848 | ||
Entity Common Stock, Shares Outstanding | 90,502,491 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fixed maturity securities: | ||
Available for sale, at fair value (amortized cost: 2018 - $46,131,190; 2017 - $43,116,759) | $ 45,923,727 | $ 45,372,989 |
Held for investment, at amortized cost (fair value: 2017 - $76,460) | 0 | 77,041 |
Mortgage loans on real estate | 2,943,091 | 2,665,531 |
Derivative instruments | 205,149 | 1,568,380 |
Other investments | 355,531 | 616,764 |
Total investments | 49,427,498 | 50,300,705 |
Cash and cash equivalents | 344,396 | 1,434,045 |
Coinsurance deposits | 4,954,068 | 4,858,289 |
Accrued investment income | 468,729 | 429,008 |
Deferred policy acquisition costs | 3,535,838 | 2,714,523 |
Deferred sales inducements | 2,516,721 | 2,001,892 |
Deferred income taxes | 291,169 | 38,147 |
Income taxes recoverable | 26,537 | 0 |
Other assets | 60,608 | 254,127 |
Total assets | 61,625,564 | 62,030,736 |
Liabilities: | ||
Policy benefit reserves | 57,606,009 | 56,142,673 |
Other policy funds and contract claims | 270,858 | 282,884 |
Notes and loan payable | 494,591 | 494,093 |
Subordinated debentures | 242,982 | 242,565 |
Amounts due under repurchase agreements | 109,298 | 0 |
Income taxes payable | 0 | 34,285 |
Other liabilities | 502,725 | 1,984,079 |
Total liabilities | 59,226,463 | 59,180,579 |
Stockholders' equity: | ||
Preferred stock, par value $1 per share, 2,000,000 shares authorized, 2018 and 2017 - no shares issued and outstanding | 0 | 0 |
Common stock, par value $1 per share, 200,000,000 shares authorized; issued and outstanding: 2018 - 90,369,229 shares (excluding 1,535,960 treasury shares); 2017 - 89,331,087 shares (excluding 2,064,727 treasury shares) | 90,369 | 89,331 |
Additional paid-in capital | 811,186 | 791,446 |
Accumulated other comprehensive income (loss) | (52,432) | 724,599 |
Retained earnings | 1,549,978 | 1,244,781 |
Total stockholders' equity | 2,399,101 | 2,850,157 |
Total liabilities and stockholders' equity | $ 61,625,564 | $ 62,030,736 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fixed maturity securities: | ||
Available for sale securities, amortized cost | $ 46,131,190 | $ 43,116,759 |
Held for investment, fair value | $ 0 | $ 76,460 |
Stockholders' equity: | ||
Preferred stock, par value (dollars per share) | $ 1 | $ 1 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 90,369,229 | 89,331,087 |
Common stock, shares outstanding | 90,369,229 | 89,331,087 |
Common stock, shares held in treasury | 1,535,960 | 2,064,727 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues: | |||
Premiums and other considerations | $ 26,480 | $ 34,228 | $ 43,767 |
Annuity product charges | 224,488 | 200,494 | 173,579 |
Net investment income | 2,147,812 | 1,991,997 | 1,849,872 |
Change in fair value of derivatives | (777,848) | 1,677,871 | 164,219 |
Net realized gains (losses) on investments, excluding other than temporary impairment (OTTI) losses | (37,178) | 10,509 | 11,524 |
OTTI losses on investments: | |||
Total OTTI losses | (35,005) | (2,758) | (21,349) |
Portion of OTTI losses recognized in (from) other comprehensive income | (1,651) | (1,872) | (1,330) |
Net OTTI losses recognized in operations | (36,656) | (4,630) | (22,679) |
Loss on extinguishment of debt | 0 | (18,817) | 0 |
Total revenues | 1,547,098 | 3,891,652 | 2,220,282 |
Benefits and expenses: | |||
Insurance policy benefits and change in future policy benefits | 39,530 | 43,219 | 52,483 |
Interest sensitive and index product benefits | 1,610,835 | 2,023,668 | 725,472 |
Amortization of deferred sales inducements | 222,201 | 176,612 | 251,166 |
Change in fair value of embedded derivatives | (1,389,491) | 919,735 | 543,465 |
Interest expense on notes and loan payable | 25,498 | 30,368 | 28,248 |
Interest expense on subordinated debentures | 15,491 | 14,124 | 12,958 |
Amortization of deferred policy acquisition costs | 327,991 | 255,964 | 374,012 |
Other operating costs and expenses | 129,301 | 111,691 | 102,231 |
Total benefits and expenses | 981,356 | 3,575,381 | 2,090,035 |
Income before income taxes | 565,742 | 316,271 | 130,247 |
Income tax expense | 107,726 | 141,626 | 47,004 |
Net income | $ 458,016 | $ 174,645 | $ 83,243 |
Earnings per common share | $ 5.07 | $ 1.96 | $ 0.98 |
Earnings per common share - assuming dilution | $ 5.01 | $ 1.93 | $ 0.97 |
Weighted average common shares outstanding: earnings per common share | 90,347,915 | 88,982,442 | 84,793,151 |
Weighted average common shares outstanding: earnings per common share - assuming dilution | 91,422,585 | 90,311,008 | 85,605,169 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Net income | $ 458,016 | $ 174,645 | $ 83,243 | |
Other comprehensive income (loss): | ||||
Change in net unrealized investment gains/losses (1) | [1] | (1,129,213) | 556,384 | 207,994 |
Noncredit component of OTTI losses (1) | [1] | 775 | 915 | 556 |
Reclassification of unrealized investment gains/losses to net income (1) | [1] | (16,606) | 4,496 | 4,224 |
Other comprehensive income (loss) before income tax | (1,145,044) | 561,795 | 212,774 | |
Income tax effect related to other comprehensive income (loss) | 240,459 | (177,162) | (74,471) | |
Other comprehensive income (loss) | (904,585) | 384,633 | 138,303 | |
Comprehensive income (loss) | $ (446,569) | $ 559,278 | $ 221,546 | |
[1] | Net of related adjustments to amortization of deferred sales inducements and deferred policy acquisition costs. |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings |
Stockholders' equity at beginning of period at Dec. 31, 2015 | $ 1,944,535 | $ 81,354 | $ 630,367 | $ 201,663 | $ 1,031,151 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 83,243 | 83,243 | |||
Other comprehensive income (loss) | 138,303 | 138,303 | |||
Share-based compensation | 7,218 | 7,218 | |||
Issuance of common stock via settlement of forward sale agreements | 134,662 | 5,590 | 129,072 | ||
Issuance of common stock under compensation plans | 4,745 | 964 | 3,781 | ||
Issuance of common stock to settle warrants that have reached their expiration | (1) | 93 | (94) | ||
Dividends on common stock | (21,110) | (21,110) | |||
Stockholders' equity at end of period at Dec. 31, 2016 | 2,291,595 | 88,001 | 770,344 | 339,966 | 1,093,284 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 174,645 | 174,645 | |||
Other comprehensive income (loss) | 384,633 | 384,633 | |||
Share-based compensation | 6,464 | 6,464 | |||
Issuance of common stock under compensation plans | 15,968 | 1,330 | 14,638 | ||
Dividends on common stock | (23,148) | (23,148) | |||
Stockholders' equity at end of period at Dec. 31, 2017 | 2,850,157 | 89,331 | 791,446 | 724,599 | 1,244,781 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 458,016 | 458,016 | |||
Other comprehensive income (loss) | (904,585) | (904,585) | |||
Implementation of accounting standard related to the reclassification of certain tax effects | 127,554 | (127,554) | |||
Share-based compensation | 11,097 | 11,097 | |||
Issuance of common stock under compensation plans | 9,681 | 1,038 | 8,643 | ||
Dividends on common stock | (25,265) | (25,265) | |||
Stockholders' equity at end of period at Dec. 31, 2018 | $ 2,399,101 | $ 90,369 | $ 811,186 | $ (52,432) | $ 1,549,978 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders' Equity (Parentheticals) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Stockholders' Equity [Abstract] | |||
Shares of common stock issued under compensation plans | 1,038,142 | 1,329,957 | 964,053 |
Shares of common stock issued to settle warrants that have reached their expiration | 92,998 | ||
Dividends on common stock, per share amount | $ 0.28 | $ 0.26 | $ 0.24 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Operating activities | |||
Net income | $ 458,016 | $ 174,645 | $ 83,243 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Interest sensitive and index product benefits | 1,610,835 | 2,023,668 | 725,472 |
Amortization of deferred sales inducements | 222,201 | 176,612 | 251,166 |
Annuity product charges | (224,488) | (200,494) | (173,579) |
Change in fair value of embedded derivatives | (1,389,491) | 919,735 | 543,465 |
Change in traditional life and accident and health insurance reserves | (163) | (33) | 12,724 |
Policy acquisition costs deferred | (388,222) | (406,641) | (543,325) |
Amortization of deferred policy acquisition costs | 327,991 | 255,964 | 374,012 |
Provision for depreciation and other amortization | 3,474 | 3,948 | 3,879 |
Amortization of discounts and premiums on investments | 19,204 | 15,431 | 1,070 |
Loss on extinguishment of debt | 0 | 18,817 | 0 |
Realized gains (losses) on investments and net OTTI losses recognized in operations | 73,834 | (5,879) | 11,155 |
Change in fair value of derivatives | 777,575 | (1,678,956) | (165,727) |
Distributions from equity method investments | 1,270 | 1,454 | 2,064 |
Deferred income taxes | (12,563) | (46,730) | (10,408) |
Share-based compensation | 11,097 | 6,464 | 6,692 |
Change in accrued investment income | (39,721) | (31,235) | (35,669) |
Change in income taxes recoverable/payable | (60,822) | 45,759 | 18,125 |
Change in other assets | (844) | 448 | 1,812 |
Change in other policy funds and contract claims | (19,029) | (23,101) | (34,411) |
Change in collateral held for derivatives | (1,296,629) | 772,181 | 414,655 |
Change in other liabilities | (17,318) | (84,416) | (55,940) |
Other | (13,022) | (13,794) | (14,089) |
Net cash provided by operating activities | 43,185 | 1,923,847 | 1,416,386 |
Sales, maturities, or repayments of investments: | |||
Fixed maturity securities - available for sale | 3,870,415 | 1,911,991 | 2,746,510 |
Mortgage loans on real estate | 298,100 | 351,255 | 383,763 |
Derivative instruments | 1,446,948 | 1,697,948 | 284,470 |
Other investments | 358,372 | 9,117 | 11,981 |
Acquisitions of investments: | |||
Fixed maturity securities - available for sale | (6,852,481) | (5,026,640) | (6,883,895) |
Mortgage loans on real estate | (575,367) | (535,249) | (428,833) |
Derivative instruments | (864,717) | (691,428) | (602,349) |
Other investments | (85,318) | (305,575) | (11,559) |
Purchases of property, furniture and equipment | (4,283) | (4,809) | (1,197) |
Net cash used in investing activities | (2,408,331) | (2,593,390) | (4,501,109) |
Financing activities | |||
Receipts credited to annuity policyholder account balances | 4,381,150 | 4,152,264 | 7,092,348 |
Coinsurance deposits | (23,838) | (6,597) | (1,317,555) |
Return of annuity policyholder account balances | (3,159,700) | (2,809,486) | (2,535,669) |
Financing fees incurred and deferred | 0 | (5,817) | (1,456) |
Proceeds from issuance of notes payable | 0 | 499,650 | 0 |
Repayment of notes payable | 0 | (413,252) | 0 |
Repayment of loan payable | 0 | (100,000) | 0 |
Proceeds from issuance of loan payable | 0 | 0 | 100,000 |
Net proceeds from amounts due under repurchase agreements | 109,298 | 0 | 0 |
Excess tax benefits realized from share-based compensation plans | 527 | ||
Proceeds from issuance of common stock | 9,681 | 14,028 | 139,654 |
Change in checks in excess of cash balance | (15,829) | 4,680 | 21,501 |
Dividends paid | (25,265) | (23,148) | (21,110) |
Net cash provided by (used in) financing activities | 1,275,497 | 1,312,322 | 3,478,240 |
Increase (decrease) in cash and cash equivalents | (1,089,649) | 642,779 | 393,517 |
Cash and cash equivalents at beginning of year | 1,434,045 | 791,266 | 397,749 |
Cash and cash equivalents at end of year | 344,396 | 1,434,045 | 791,266 |
Cash paid during the year for interest: | |||
Interest expense | 39,575 | 55,445 | 39,647 |
Cash paid during the year for income taxes: | |||
Income taxes | 181,202 | 142,627 | 39,066 |
Non-cash operating activity: | |||
Deferral of sales inducements | 179,465 | 216,172 | 353,966 |
Non-cash financing activity: | |||
Common stock issued to settle warrants that have expired | $ 0 | $ 0 | $ 93 |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Nature of Operations American Equity Investment Life Holding Company ("we", "us", "our" or "parent company"), through its wholly-owned subsidiaries, American Equity Investment Life Insurance Company ("American Equity Life"), American Equity Investment Life Insurance Company of New York ("American Equity Life of New York") and Eagle Life Insurance Company ("Eagle Life"), is licensed to sell insurance products in 50 states and the District of Columbia at December 31, 2018 . We operate solely in the insurance business. We primarily market fixed index and fixed rate annuities. Annuity deposits (net of coinsurance) collected in 2018 , 2017 and 2016 , by product type were as follows: Year Ended December 31, Product Type 2018 2017 2016 (Dollars in thousands) Fixed index annuities $ 3,898,366 $ 3,668,121 $ 5,035,818 Annual reset fixed rate annuities 46,744 74,572 63,582 Multi-year fixed rate annuities 22,818 22,291 256,894 Single premium immediate annuities (SPIA) 23,813 24,946 35,851 $ 3,991,741 $ 3,789,930 $ 5,392,145 Agents contracted with us through two national marketing organizations accounted for more than 10% of annuity deposits we collected during 2018 representing 20% and 14% , individually, of the annuity deposits collected. Agents contracted with us through two national marketing organization accounted for more than 10% of annuity deposits we collected during 2017 representing 14% and 10% , individually, of the annuity deposits collected. Agents contracted with us through one national marketing organization accounted for more than 10% of annuity deposits we collected during 2016 representing 15% of the annuity deposits collected. Consolidation and Basis of Presentation The consolidated financial statements include our accounts and our wholly-owned subsidiaries: American Equity Life, American Equity Life of New York, Eagle Life, AERL, L.C., American Equity Capital, Inc., American Equity Investment Properties, L.C., American Equity Advisors, Inc. and American Equity Investment Service Company. All significant intercompany accounts and transactions have been eliminated. As of December 31, 2018, American Equity Capital, Inc., American Equity Advisors, Inc. and American Equity Investment Service Company have been dissolved. Estimates and Assumptions The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates and assumptions are utilized in the calculation of deferred policy acquisition costs, deferred sales inducements, policy benefit reserves, including the liability for lifetime income benefit riders and the valuation of embedded derivatives on index annuity reserves, valuation of derivatives, valuation of investments, other than temporary impairment of investments, allowances for loan losses on mortgage loans and valuation allowances on deferred tax assets. A description of each critical estimate is incorporated within the discussion of the related accounting policies which follow. It is reasonably possible that actual experience could differ from the estimates and assumptions utilized. Investments Fixed maturity securities (bonds maturing more than one year after issuance) that may be sold prior to maturity are classified as available for sale. Available for sale securities are reported at fair value and unrealized gains and losses, if any, on these securities are included directly in a separate component of stockholders' equity, net of income taxes and certain adjustments for assumed changes in amortization of deferred policy acquisition costs and deferred sales inducements. Fair values, as reported herein, of fixed maturity and equity securities are based on quoted market prices in active markets when available, or for those fixed maturity securities not actively traded, yield data and other factors relating to instruments or securities with similar characteristics are used. See Note 2 for more information on the determination of fair value. Premiums and discounts are amortized/accrued using methods which result in a constant yield over the securities' expected lives. Amortization/accrual of premiums and discounts on residential and commercial mortgage backed securities incorporate prepayment assumptions to estimate the securities' expected lives. Interest income is recognized as earned. Fixed maturity securities that we have the positive intent and ability to hold to maturity are classified as held for investment. Held for investment securities are reported at cost adjusted for amortization of premiums and discounts. Changes in the fair value of these securities, except for declines that are other than temporary, are not reflected in our consolidated financial statements. The carrying amounts of our impaired investments in fixed maturity securities are adjusted for declines in value that are other than temporary. Other than temporary impairment losses are reported as a component of revenues in the consolidated statements of operations, which presents the amount of noncredit impairment losses that is reported in accumulated other comprehensive income (loss). See Note 3 for further discussion of other than temporary impairment losses. Deterioration in credit quality of the companies or assets backing our fixed maturity securities, imbalances in liquidity recurring in the marketplace or declines in real estate values may further affect the fair value of these fixed maturity securities and increase the potential that certain unrealized losses will be recognized as other than temporary impairments in the future. Mortgage loans on real estate are reported at cost, adjusted for amortization of premiums and accrual of discounts. Interest income is recorded when earned; however, interest ceases to accrue for loans on which interest is more than 90 days past due based upon contractual terms and/or when the collection of interest is not considered probable. We evaluate the mortgage loan portfolio for the establishment of a loan loss allowance by specific identification of impaired loans and the measurement of an estimated loss, if any, for each impaired loan identified and an analysis of the mortgage loan portfolio for the need of a general loan allowance for probable losses on all loans. If we determine that the value of any specific mortgage loan is impaired, the carrying amount of the mortgage loan will be reduced to its fair value, based upon the present value of expected future cash flows from the loan discounted at the loan's contractual interest rate, or the fair value of the underlying collateral, less costs to sell. The amount of the general loan allowance, if any, is based upon our evaluation of the probability of collection, historical loss experience, delinquencies, credit concentrations, underwriting standards and national and local economic conditions. The carrying value of impaired loans is reduced by the establishment of an allowance for loan losses, changes to which are recognized as realized gains or losses on investments. Interest income on impaired loans is recorded on a cash basis. Other invested assets include company owned life insurance, equity securities, real estate, limited partnerships accounted for using the equity method and policy loans. Company owned life insurance is recorded at the amount that can be realized under the insurance contract at the end of the reporting period, which is the cash surrender value adjusted for other charges or other amounts due that are probable at settlement. Dividends are recognized when declared. Policy loans are stated at current unpaid principal balances. Real estate owned is reported at cost less accumulated depreciation. Cost is determined at the time ownership is acquired in satisfaction of mortgage loans and is the lower of the carrying value of the mortgage loan or fair value of the real estate less its estimated cost to sell. Buildings and improvements are depreciated using the straight-line method over their estimated useful lives. Impairment losses on real estate owned are recognized when there are indicators of impairment present and the expected future undiscounted cash flows are not sufficient to recover the real estate's carrying value. Any impairment losses are reported as realized losses and are part of net income. Realized gains and losses on sales of investments are determined on the basis of specific identification based on the trade date. Derivative Instruments Our derivative instruments include call options used to fund fixed index annuity credits and interest rate swap and caps used to manage interest rate risk associated with the floating rate component on certain of our subordinated debentures. All of our derivative instruments are recognized in the balance sheet at fair value and changes in fair value are recognized immediately in operations. See Note 5 for more information on derivative instruments. Cash and Cash Equivalents We consider all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents. Book Overdrafts Under our cash management system, checks issued but not yet presented to banks frequently result in overdraft balances for accounting purposes and are classified as Other liabilities on our consolidated balance sheets. We report the changes in the amount of the overdraft balance as a financing activity in our consolidated statement of cash flows as Change in checks in excess of cash balance. Deferred Policy Acquisition Costs and Deferred Sales Inducements To the extent recoverable from future policy revenues and gross profits, certain costs that are incremental or directly related to the successful production of new business are not expensed when incurred but instead are capitalized as deferred policy acquisition costs or deferred sales inducements. Deferred policy acquisition costs and deferred sales inducements are subject to loss recognition testing on a quarterly basis or when an event occurs that may warrant loss recognition. Deferred policy acquisition costs consist primarily of commissions and certain costs of policy issuance. Deferred sales inducements consist of premium and interest bonuses credited to policyholder account balances. For annuity products, these capitalized costs are being amortized in proportion to expected gross profits from investment spreads, including the cost of hedging the fixed indexed annuity obligations, and, to a lesser extent, from product charges net of expected excess payments for lifetime income benefit riders, and mortality and expense margins. Current and future period gross profits/margins for fixed index annuities also include the impact of amounts recorded for the change in fair value of derivatives and the change in fair value of embedded derivatives. That amortization is adjusted retrospectively through an unlocking process when estimates of current or future gross profits/margins (including the impact of net realized gains on investments and net OTTI losses recognized in operations) to be realized from a group of products are revised. Deferred policy acquisition costs and deferred sales inducements are also adjusted for the change in amortization that would have occurred if available for sale fixed maturity securities had been sold at their aggregate fair value at the end of the reporting period and the proceeds reinvested at current yields. The impact of this adjustment is included in accumulated other comprehensive income (loss) within consolidated stockholders' equity, net of applicable taxes. See Note 6 for more information on deferred policy acquisition costs and deferred sales inducements. Policy Benefit Reserves Policy benefit reserves for fixed index annuities with returns linked to the performance of a specified market index are equal to the sum of the fair value of the embedded derivatives and the host (or guaranteed) component of the contracts. The host value is established at inception of the contract and accreted over the policy's life at a constant rate of interest. Future policy benefit reserves for fixed index annuities earning a fixed rate of interest and other deferred annuity products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges. For the years ended December 31, 2018 , 2017 and 2016 , interest crediting rates for these products ranged from 1.00% to 3.30% . The liability for lifetime income benefit riders is based on estimates of the present value of benefit payments expected to be paid in excess of projected policy values recognizing the excess over the expected lives of the underlying policies based on the actual and present value of expected assessments including spreads and product charges and fees. The inputs used in the calculation of the liability for lifetime income benefit riders include actual policy values, actual income account values, actual payout factors, actual roll-up rates and our best estimate assumptions for future policy growth, future policy decrements, the ages at which policyholders are expected to elect to begin to receive lifetime income benefit payments, the percentage of policyholders who elect to receive lifetime income benefit payments and the type of income benefit payments selected upon election. See Note 6 for more information on lifetime income benefit rider reserves. Policy benefit reserves are not reduced for amounts ceded under coinsurance agreements which are reported as coinsurance deposits on our consolidated balance sheets. See Note 7 for more information on reinsurance. Deferred Income Taxes Deferred income tax assets or liabilities are computed based on the temporary differences between the financial statement and income tax bases of assets and liabilities using the enacted marginal tax rate. The effect on deferred income tax assets and liabilities resulting from a change in the enacted marginal tax rate is recognized in income in the period that includes the enactment date. Deferred income tax expenses or benefits are based on the changes in the asset or liability from period to period. Deferred income tax assets are subject to ongoing evaluation of whether such assets will more likely than not be realized. The realization of deferred income tax assets primarily depends on generating future taxable income during the periods in which temporary differences become deductible. Deferred income tax assets are reduced by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax asset will not be realized. In making such a determination, all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial operations, is considered. The realization of deferred income tax assets related to unrealized losses on available for sale fixed maturity securities is also based upon our intent and ability to hold those securities for a period of time sufficient to allow for a recovery in fair value and not realize the unrealized loss. Recognition of Premium Revenues and Costs Revenues for annuity products include surrender and living income benefit rider charges assessed against policyholder account balances during the period. Interest sensitive and index product benefits related to annuity products include interest credited or index credits to policyholder account balances pursuant to accounting by insurance companies for certain long-duration contracts. The change in fair value of the embedded derivatives for fixed index annuities equals the change in the difference between policy benefit reserves for fixed index annuities computed under the derivative accounting standard and the long-duration contracts accounting standard at each balance sheet date. Considerations from immediate annuities and supplemental contract annuities with life contingencies are recognized as revenue when the policy is issued. All insurance-related revenues, including the change in the fair value of derivatives for call options related to the business ceded under coinsurance agreements (see Note 7), benefits, losses and expenses are reported net of reinsurance ceded. Other Comprehensive Income (Loss) Other comprehensive income (loss) includes all changes in stockholders' equity during a period except those resulting from investments by and distributions to stockholders. Other comprehensive income (loss) excludes net realized investment gains (losses) included in net income which merely represents transfers from unrealized to realized gains and losses. Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued an accounting standards update ("ASU") related to revenue arising from contracts with customers. This ASU, which replaces most current revenue recognition guidance, including industry specific guidance, prescribes that an entity should recognize revenue to reflect the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We adopted this ASU on January 1, 2018. The adoption of this ASU had no impact on our consolidated financial statements as revenues related to insurance contracts and investment contracts are excluded from its scope. In January 2016, the FASB issued an ASU that, among other aspects of recognition, measurement, presentation and disclosure of financial instruments, primarily requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Additionally, it changed the accounting for financial liabilities measured at fair value under the fair value option and eliminates some disclosures regarding fair value of financial assets and liabilities measured at amortized cost. We adopted this ASU on January 1, 2018. The adoption of this ASU had no impact on our consolidated financial statements. In March 2016, the FASB issued an ASU related to the accounting for share-based payment transactions. The aspects of accounting guidance affected by this ASU are income taxes, classification of awards as either equity or liabilities, and classification on the statement of cash flows. We adopted this ASU on January 1, 2017. The adoption of this ASU resulted in an income tax benefit of $2.8 million and $2.7 million being recognized in operations during the years ended December 31, 2018 and 2017, respectively, due to the requirement under this standard to recognize excess tax benefits related to share-based payment awards in income tax expense. In August 2016, the FASB issued an ASU that clarifies how certain cash receipts and cash payments are to be presented and classified in the statement of cash flows. We adopted this ASU on January 1, 2018. The adoption of this ASU, which resulted in a reclassification of certain cash flows related to equity method investment distributions from investing activities to operating activities within our consolidated statements of cash flows, did not have a material impact on our consolidated financial statements. In February 2018, the FASB issued an ASU that allows a reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 ("Tax Reform"). We adopted this ASU on January 1, 2018. The adoption of this ASU resulted in a reclassification of $128 million between accumulated other comprehensive income (loss) and retained earnings within our consolidated balance sheet. New Accounting Pronouncements In February 2016, the FASB issued an ASU that will require recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This ASU affects accounting and disclosure more dramatically for lessees as accounting for lessors is mainly unchanged. This ASU will be effective for us on January 1, 2019, with early adoption permitted. The primary impact this guidance will have on our consolidated financial statements is recognition of a lease asset and lease liability within our consolidated balance sheet. Based on our lease agreements at December 31, 2018, we would recognize a lease asset and lease liability of approximately $3.7 million . In June 2016, the FASB issued an ASU that significantly changes the impairment model for most financial assets that are measured at amortized cost and certain other instruments from an incurred loss model to an expected loss model that requires these assets be presented at the net amount expected to be collected. In addition, credit losses on available for sale debt securities will be recorded through an allowance account. This ASU will be effective for us on January 1, 2020, with early adoption permitted. While we are still in the process of evaluating the full impact this guidance will have on our consolidated financial statements, we believe the new impairment model will lead to earlier recognition of credit losses for our commercial mortgage loans. In March 2017, the FASB issued an ASU that applies to certain callable debt securities where the amortized cost basis is at a premium to the price repayable by the issuer at the earliest call date. Under this guidance, the premium will be amortized to the first call date. This ASU will be effective for us on January 1, 2019. This guidance is to be adopted on a modified retrospective basis through a cumulative-effective adjustment to retained earnings as of the beginning of the period of adoption. The adoption of this guidance will not have a material impact on our consolidated financial statements. In June 2018, the FASB issued an ASU that expands the scope of Accounting Standards Codification 718, Compensation-Stock Compensation, to include share-based payment transactions for acquiring goods and services to nonemployees and eliminates the existing accounting model for nonemployee share-based payment awards. This ASU will be effective for us on January 1, 2019, with early adoption permitted. While this guidance will lead to an earlier measurement date for our nonemployee restricted stock units that have not vested as of January 1, 2019, it will not impact our consolidated financial statements upon adoption. In August 2018, the FASB issued an ASU that revises certain aspects of the measurement models and disclosure requirements for long duration insurance and investment contracts. The FASB’s objective in issuing this ASU is to improve, simplify, and enhance the accounting for long-duration contracts. The revisions include updating cash flow assumptions in the calculation of the liability for traditional life products, introducing the term ‘market risk benefit’ ("MRB") and requiring all contract features meeting the definition of an MRB to be measured at fair value, simplifying the method used to amortize deferred policy acquisition costs and deferred sales inducements to a constant basis over the expected term of the related contracts rather than based on gross profits and enhancing disclosure requirements. While this ASU is effective for us on January 1, 2021, the transition date (the remeasurement date) is January 1, 2019. Early adoption of this ASU is permitted. We are in process of evaluating the impact this guidance will have on our consolidated financial statements. Income Tax Reform As a result of Tax Reform, the statutory federal corporate tax rate was reduced from 35% to 21% effective January 1, 2018. |
Fair Values of Financial Instru
Fair Values of Financial Instruments | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Values of Financial Instruments | Fair Values of Financial Instruments The following sets forth a comparison of the carrying amounts and fair values of our financial instruments: December 31, 2018 2017 Carrying Amount Fair Value Carrying Amount Fair Value (Dollars in thousands) Assets Fixed maturity securities: Available for sale $ 45,923,727 $ 45,923,727 $ 45,372,989 $ 45,372,989 Held for investment — — 77,041 76,460 Mortgage loans on real estate 2,943,091 2,920,612 2,665,531 2,670,037 Derivative instruments 205,149 205,149 1,568,380 1,568,380 Other investments 355,531 348,970 616,764 605,894 Cash and cash equivalents 344,396 344,396 1,434,045 1,434,045 Coinsurance deposits 4,954,068 4,553,790 4,858,289 4,347,990 Interest rate caps 597 597 415 415 Interest rate swap 354 354 — — Counterparty collateral 33,101 33,101 186,108 186,108 Liabilities Policy benefit reserves 57,249,510 49,180,143 55,786,011 46,344,931 Single premium immediate annuity (SPIA) benefit reserves 270,406 279,077 282,563 292,153 Notes payable 494,591 489,985 494,093 521,800 Subordinated debentures 242,982 215,514 242,565 244,117 Amounts due under repurchase agreements 109,298 109,298 — — Interest rate swap — — 789 789 Fair value is the price that would be received to sell an asset or paid to transfer a liability (exit price) in an orderly transaction between market participants at the measurement date. The objective of a fair value measurement is to determine that price for each financial instrument at each measurement date. We meet this objective using various methods of valuation that include market, income and cost approaches. We categorize our financial instruments into three levels of fair value hierarchy based on the priority of inputs used in determining fair value. The hierarchy defines the highest priority inputs (Level 1) as quoted prices in active markets for identical assets or liabilities. The lowest priority inputs (Level 3) are our own assumptions about what a market participant would use in determining fair value such as estimated future cash flows. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, a financial instrument's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument. We categorize financial assets and liabilities recorded at fair value in the consolidated balance sheets as follows: Level 1— Quoted prices are available in active markets for identical financial instruments as of the reporting date. We do not adjust the quoted price for these financial instruments, even in situations where we hold a large position and a sale could reasonably impact the quoted price. Level 2— Quoted prices in active markets for similar financial instruments, quoted prices for identical or similar financial instruments in markets that are not active; and models and other valuation methodologies using inputs other than quoted prices that are observable. Level 3— Models and other valuation methodologies using significant inputs that are unobservable for financial instruments and include situations where there is little, if any, market activity for the financial instrument. The inputs into the determination of fair value require significant management judgment or estimation. Financial instruments that are included in Level 3 are securities for which no market activity or data exists and for which we used discounted expected future cash flows with our own assumptions about what a market participant would use in determining fair value. Transfers of securities among the levels occur at times and depend on the type of inputs used to determine fair value of each security. There were no transfers between levels during any period presented. Our assets and liabilities which are measured at fair value on a recurring basis as of December 31, 2018 and 2017 are presented below based on the fair value hierarchy levels: Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (Dollars in thousands) December 31, 2018 Assets Fixed maturity securities: Available for sale: United States Government full faith and credit $ 11,652 $ 5,900 $ 5,752 $ — United States Government sponsored agencies 1,138,529 — 1,138,529 — United States municipalities, states and territories 4,126,267 — 4,126,267 — Foreign government obligations 230,274 — 230,274 — Corporate securities 28,371,514 7 28,371,507 — Residential mortgage backed securities 1,202,159 — 1,202,159 — Commercial mortgage backed securities 5,379,003 — 5,379,003 — Other asset backed securities 5,464,329 — 5,464,329 — Other investments: equity securities, available for sale 7,437 — 7,437 — Derivative instruments 205,149 — 205,149 — Cash and cash equivalents 344,396 344,396 — — Interest rate caps 597 — 597 — Interest rate swap 354 — 354 — Counterparty collateral 33,101 — 33,101 — $ 46,514,761 $ 350,303 $ 46,164,458 $ — Liabilities Fixed index annuities - embedded derivatives $ 8,165,405 $ — $ — $ 8,165,405 December 31, 2017 Assets Fixed maturity securities: Available for sale: United States Government full faith and credit $ 11,876 $ 5,640 $ 6,236 $ — United States Government sponsored agencies 1,305,017 — 1,305,017 — United States municipalities, states and territories 4,166,812 — 4,166,812 — Foreign government obligations 239,360 — 239,360 — Corporate securities 29,878,971 5 29,878,966 — Residential mortgage backed securities 1,105,567 — 1,105,567 — Commercial mortgage backed securities 5,544,850 — 5,544,850 — Other asset backed securities 3,120,536 — 3,120,536 — Other investments: equity securities, available for sale 292,429 285,000 7,429 — Derivative instruments 1,568,380 — 1,568,380 — Cash and cash equivalents 1,434,045 1,434,045 — — Interest rate caps 415 — 415 — Counterparty collateral 186,108 — 186,108 — $ 48,854,366 $ 1,724,690 $ 47,129,676 $ — Liabilities Interest rate swap $ 789 $ — $ 789 $ — Fixed index annuities - embedded derivatives 8,790,427 — — 8,790,427 $ 8,791,216 $ — $ 789 $ 8,790,427 The following methods and assumptions were used in estimating the fair values of financial instruments during the periods presented in these consolidated financial statements. Fixed maturity securities and equity securities The fair values of fixed maturity securities and equity securities in an active and orderly market are determined by utilizing independent pricing services. The independent pricing services incorporate a variety of observable market data in their valuation techniques, including: • reported trading prices, • benchmark yields, • broker-dealer quotes, • benchmark securities, • bids and offers, • credit ratings, • relative credit information, and • other reference data. The independent pricing services also take into account perceived market movements and sector news, as well as a security's terms and conditions, including any features specific to that issue that may influence risk and marketability. Depending on the security, the priority of the use of observable market inputs may change as some observable market inputs may not be relevant or additional inputs may be necessary. The independent pricing services provide quoted market prices when available. Quoted prices are not always available due to market inactivity. When quoted market prices are not available, the third parties use yield data and other factors relating to instruments or securities with similar characteristics to determine fair value for securities that are not actively traded. We generally obtain one value from our primary external pricing service. In situations where a price is not available from this service, we may obtain quotes or prices from additional parties as needed. Market indices of similar rated asset class spreads are considered for valuations and broker indications of similar securities are compared. Inputs used by the broker include market information, such as yield data and other factors relating to instruments or securities with similar characteristics. Valuations and quotes obtained from third party commercial pricing services are non-binding and do not represent quotes on which one may execute the disposition of the assets. We validate external valuations at least quarterly through a combination of procedures that include the evaluation of methodologies used by the pricing services, comparison of the prices to a secondary pricing source, analytical reviews and performance analysis of the prices against trends, and maintenance of a securities watch list. Additionally, as needed we utilize discounted cash flow models or perform independent valuations on a case-by-case basis using inputs and assumptions similar to those used by the pricing services. Although we do identify differences from time to time as a result of these validation procedures, we did not make any significant adjustments as of December 31, 2018 and 2017 . Mortgage loans on real estate Mortgage loans on real estate are not measured at fair value on a recurring basis. The fair values of mortgage loans on real estate are calculated using discounted expected cash flows using competitive market interest rates currently being offered for similar loans. The fair values of impaired mortgage loans on real estate that we have considered to be collateral dependent are based on the fair value of the real estate collateral (based on appraised values) less estimated costs to sell. The inputs utilized to determine fair value of all mortgage loans are unobservable market data (competitive market interest rates); therefore, fair value of mortgage loans falls into Level 3 in the fair value hierarchy. Derivative instruments The fair values of derivative instruments, primarily call options, are based upon the amount of cash that we will receive to settle each derivative instrument on the reporting date. These amounts are determined by our investment team using industry accepted valuation models and are adjusted for the nonperformance risk of each counterparty net of any collateral held. Inputs include market volatility and risk free interest rates and are used in income valuation techniques in arriving at a fair value for each option contract. The nonperformance risk for each counterparty is based upon its credit default swap rate. We have no performance obligations related to the call options purchased to fund our fixed index annuity policy liabilities. Other investments Equity securities are the only financial instruments included in other investments that are measured at fair value on a recurring basis (see determination of fair value above). Financial instruments included in other investments that are not measured at fair value on a recurring basis are policy loans, equity method investments and company owned life insurance ("COLI"). We have not attempted to determine the fair values associated with our policy loans, as we believe any differences between carrying values and the fair values afforded these instruments are immaterial to our consolidated financial position and, accordingly, the cost to provide such disclosure does not justify the benefit to be derived. The fair values of our equity method investments are obtained from third parties and determined by calculating the present value of future cash flows discounted by a risk free rate, a risk spread and a liquidity discount. As the risk spread and liquidity discount are unobservable market inputs, the fair value of our equity method investments falls within Level 3 of the fair value hierarchy. The fair value of our COLI approximates the cash surrender value of the policies and falls within Level 2 of the fair value hierarchy. Cash and cash equivalents Amounts reported in the consolidated balance sheets for these instruments are reported at their historical cost which approximates fair value due to the nature of the assets assigned to this category. Interest rate swap and caps The fair values of our pay fixed/receive variable interest rate swap and our interest rate caps are obtained from third parties and are determined by discounting expected future cash flows using a projected London Interbank Offered Rate ("LIBOR") for the term of the swap and caps. Counterparty collateral Amounts reported in other assets in the consolidated balance sheets for these instruments are reported at their historical cost which approximates fair value due to the nature of the assets assigned to this category. Policy benefit reserves, coinsurance deposits and SPIA benefit reserves The fair values of the liabilities under contracts not involving significant mortality or morbidity risks (principally deferred annuities), are stated at the cost we would incur to extinguish the liability (i.e., the cash surrender value) as these contracts are generally issued without an annuitization date. The coinsurance deposits related to the annuity benefit reserves have fair values determined in a similar fashion. For period-certain annuity benefit contracts, the fair value is determined by discounting the benefits at the interest rates currently in effect for newly issued immediate annuity contracts. We are not required to and have not estimated the fair value of the liabilities under contracts that involve significant mortality or morbidity risks, as these liabilities fall within the definition of insurance contracts that are exceptions from financial instruments that require disclosures of fair value. Policy benefit reserves, coinsurance deposits and SPIA benefit reserves are not measured at fair value on a recurring basis. All of the fair values presented within these categories fall within Level 3 of the fair value hierarchy as most of the inputs are unobservable market data. Notes payable The fair values of our senior unsecured notes are based upon pricing matrices developed by a third party pricing service when quoted market prices are not available and are categorized as Level 2 within the fair value hierarchy. Notes payable are not remeasured at fair value on a recurring basis. Subordinated debentures Fair values for subordinated debentures are estimated using discounted cash flow calculations based principally on observable inputs including our incremental borrowing rates, which reflect our credit rating, for similar types of borrowings with maturities consistent with those remaining for the debt being valued. These fair values are categorized as Level 2 within the fair value hierarchy. Subordinated debentures are not measured at fair value on a recurring basis. Amounts due under repurchase agreements The amounts reported in the consolidated balance sheets for short term indebtedness under repurchase agreements with variable interest rates approximate their fair values. Fixed index annuities - embedded derivatives We estimate the fair value of the embedded derivative component of our fixed index annuity policy benefit reserves at each valuation date by (i) projecting policy contract values and minimum guaranteed contract values over the expected lives of the contracts and (ii) discounting the excess of the projected contract value amounts at the applicable risk free interest rates adjusted for our nonperformance risk related to those liabilities. The projections of policy contract values are based on our best estimate assumptions for future policy growth and future policy decrements. Our best estimate assumptions for future policy growth include assumptions for the expected index credit on the next policy anniversary date which are derived from the fair values of the underlying call options purchased to fund such index credits and the expected costs of annual call options we will purchase in the future to fund index credits beyond the next policy anniversary. The projections of minimum guaranteed contract values include the same best estimate assumptions for policy decrements as were used to project policy contract values. Within this determination we have the following significant unobservable inputs: 1) the expected cost of annual call options we will purchase in the future to fund index credits beyond the next policy anniversary and 2) our best estimates for future policy decrements, primarily lapse, partial withdrawal and mortality rates. As of December 31, 2018 and 2017 , we utilized an estimate of 3.10% for the expected cost of annual call options, which are based on estimated long-term account value growth and a historical review of our actual option costs. Our best estimate assumptions for lapse, partial withdrawal and mortality rates are based on our actual experience and our outlook as to future expectations for such assumptions. These assumptions, which are consistent with the assumptions used in calculating deferred policy acquisition costs and deferred sales inducements, are reviewed on a quarterly basis and are revised as our experience develops and/or as future expectations change. Our mortality rate assumptions are based on 65% of the 1983 Basic Annuity Mortality Tables. The following table presents average lapse rate and partial withdrawal rate assumptions, by contract duration, used in estimating the fair value of the embedded derivative component of our fixed index annuity policy benefit reserves at each reporting date: Average Lapse Rates Average Partial Withdrawal Rates Contract Duration (Years) December 31, 2018 December 31, 2017 December 31, 2018 December 31, 2017 1 - 5 2.05% 1.83% 3.33% 3.32% 6 - 10 7.28% 7.01% 3.33% 3.32% 11 - 15 11.35% 11.31% 3.35% 3.34% 16 - 20 11.90% 11.96% 3.22% 3.20% 20+ 11.57% 11.62% 3.22% 3.20% Lapse rates are generally expected to increase as surrender charge percentages decrease. Lapse expectations reflect a significant increase in the year in which the surrender charge period on a contract ends. The following table provides a reconciliation of the beginning and ending balances for our Level 3 liabilities, which are measured at fair value on a recurring basis using significant unobservable inputs for the years ended December 31, 2018 and 2017 : Year Ended December 31, 2018 2017 (Dollars in thousands) Fixed index annuities - embedded derivatives Beginning balance $ 8,790,427 $ 6,563,288 Premiums less benefits 1,542,606 2,052,985 Change in fair value, net (2,167,628 ) 174,154 Ending balance $ 8,165,405 $ 8,790,427 The fair value of our fixed index annuities embedded derivatives is net of coinsurance ceded of $538.8 million and $539.7 million as of December 31, 2018 and 2017 , respectively. Change in fair value, net for each period in our embedded derivatives is included in change in fair value of embedded derivatives in the consolidated statements of operations. Certain derivatives embedded in our fixed index annuity contracts are our most significant financial instrument measured at fair value that are categorized as Level 3 in the fair value hierarchy. The contractual obligations for future annual index credits within our fixed index annuity contracts are treated as a "series of embedded derivatives" over the expected life of the applicable contracts. We estimate the fair value of these embedded derivatives at each valuation date by the method described above under fixed index annuities - embedded derivatives . The projections of minimum guaranteed contract values include the same best estimate assumptions for policy decrements as were used to project policy contract values. The most sensitive assumption in determining policy liabilities for fixed index annuities is the rates used to discount the excess projected contract values. As indicated above, the discount rate reflects our nonperformance risk. If the discount rates used to discount the excess projected contract values at December 31, 2018 , were to increase by 100 basis points, the fair value of the embedded derivatives would decrease by $504.5 million recorded through operations as a decrease in the change in fair value of embedded derivatives and there would be a corresponding decrease of $423.5 million to our combined balance for deferred policy acquisition costs and deferred sales inducements recorded through operations as an increase in amortization of deferred policy acquisition costs and deferred sales inducements. A decrease by 100 basis points in the discount rate used to discount the excess projected contract values would increase the fair value of the embedded derivatives by $559.9 million recorded through operations as an increase in the change in fair value of embedded derivatives and there would be a corresponding increase of $291.8 million to our combined balance for deferred policy acquisition costs and deferred sales inducements recorded through operations as a decrease in amortization of deferred policy acquisition costs and deferred sales inducements. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2018 | |
Investments [Abstract] | |
Investments | Investments At December 31, 2018 and 2017 , the amortized cost and fair value of fixed maturity securities were as follows: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (Dollars in thousands) December 31, 2018 Fixed maturity securities: Available for sale: United States Government full faith and credit $ 11,872 $ 102 $ (322 ) $ 11,652 United States Government sponsored agencies 1,208,468 13,095 (83,034 ) 1,138,529 United States municipalities, states and territories 3,880,703 261,222 (15,658 ) 4,126,267 Foreign government obligations 226,860 7,573 (4,159 ) 230,274 Corporate securities 28,483,138 727,105 (838,729 ) 28,371,514 Residential mortgage backed securities 1,134,623 71,661 (4,125 ) 1,202,159 Commercial mortgage backed securities 5,492,271 21,558 (134,826 ) 5,379,003 Other asset backed securities 5,693,255 41,308 (270,234 ) 5,464,329 $ 46,131,190 $ 1,143,624 $ (1,351,087 ) $ 45,923,727 December 31, 2017 Fixed maturity securities: Available for sale: United States Government full faith and credit $ 11,861 $ 162 $ (147 ) $ 11,876 United States Government sponsored agencies 1,308,290 28,457 (31,730 ) 1,305,017 United States municipalities, states and territories 3,804,360 366,048 (3,596 ) 4,166,812 Foreign government obligations 228,214 13,171 (2,025 ) 239,360 Corporate securities 28,127,653 1,897,005 (145,687 ) 29,878,971 Residential mortgage backed securities 1,028,484 79,554 (2,471 ) 1,105,567 Commercial mortgage backed securities 5,531,922 82,768 (69,840 ) 5,544,850 Other asset backed securities 3,075,975 57,966 (13,405 ) 3,120,536 $ 43,116,759 $ 2,525,131 $ (268,901 ) $ 45,372,989 Held for investment: Corporate security $ 77,041 $ — $ (581 ) $ 76,460 Other investments: equity securities, available for sale $ 292,429 $ — $ — $ 292,429 The amortized cost and fair value of fixed maturity securities at December 31, 2018 , by contractual maturity are shown below. Actual maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. All of our mortgage and other asset backed securities provide for periodic payments throughout their lives and are shown below as separate lines. Available for sale Amortized Cost Fair Value (Dollars in thousands) Due in one year or less $ 365,686 $ 368,836 Due after one year through five years 5,426,450 5,416,871 Due after five years through ten years 9,918,504 9,768,751 Due after ten years through twenty years 9,565,686 9,895,985 Due after twenty years 8,534,715 8,427,793 33,811,041 33,878,236 Residential mortgage backed securities 1,134,623 1,202,159 Commercial mortgage backed securities 5,492,271 5,379,003 Other asset backed securities 5,693,255 5,464,329 $ 46,131,190 $ 45,923,727 Net unrealized gains (losses) on available for sale fixed maturity securities reported as a separate component of stockholders' equity were comprised of the following: December 31, 2018 2017 (Dollars in thousands) Net unrealized gains (losses) on available for sale fixed maturity securities $ (207,463 ) $ 2,256,230 Adjustments for assumed changes in amortization of deferred policy acquisition costs and deferred sales inducements 112,571 (1,206,078 ) Deferred income tax valuation allowance reversal 22,534 22,534 Deferred income tax benefit (expense) (a) 19,926 (348,087 ) Net unrealized gains (losses) reported as accumulated other comprehensive income (loss) $ (52,432 ) $ 724,599 (a) December 31, 2017 includes $128 million related to the impact of Tax Reform that was reclassified between accumulated other comprehensive income (loss) and retained earnings within our consolidated balance sheet during the first quarter of 2018. For more information regarding the reclassification, see Note 1. The National Association of Insurance Commissioners ("NAIC") assigns designations to fixed maturity securities. These designations range from Class 1 (highest quality) to Class 6 (lowest quality). In general, securities are assigned a designation based upon the ratings they are given by the Nationally Recognized Statistical Rating Organizations ("NRSRO's"). The NAIC designations are utilized by insurers in preparing their annual statutory statements. NAIC Class 1 and 2 designations are considered "investment grade" while NAIC Class 3 through 6 designations are considered "non-investment grade." Based on the NAIC designations, we had 97% of our fixed maturity portfolio rated investment grade at both December 31, 2018 and 2017 , respectively. The following table summarizes the credit quality, as determined by NAIC designation, of our fixed maturity portfolio as of the dates indicated: December 31, 2018 2017 NAIC Designation Amortized Cost Fair Value Amortized Cost Fair Value (Dollars in thousands) 1 $ 26,588,352 $ 26,921,843 $ 26,669,427 $ 28,274,379 2 17,901,161 17,528,072 15,198,551 15,869,219 3 1,396,650 1,269,242 1,161,737 1,157,420 4 173,987 137,991 134,838 117,542 5 23,836 19,453 17,015 20,927 6 47,204 47,126 12,232 9,962 $ 46,131,190 $ 45,923,727 $ 43,193,800 $ 45,449,449 The following table shows our investments' gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities (consisting of 2,715 and 955 securities, respectively) have been in a continuous unrealized loss position, at December 31, 2018 and 2017 : Less than 12 months 12 months or more Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses (Dollars in thousands) December 31, 2018 Fixed maturity securities: Available for sale: United States Government full faith and credit $ 543 $ (3 ) $ 7,785 $ (319 ) $ 8,328 $ (322 ) United States Government sponsored agencies 30,089 (949 ) 953,421 (82,085 ) 983,510 (83,034 ) United States municipalities, states and territories 340,103 (6,816 ) 162,997 (8,842 ) 503,100 (15,658 ) Foreign government obligations 98,511 (1,748 ) 11,859 (2,411 ) 110,370 (4,159 ) Corporate securities: Finance, insurance and real estate 2,501,640 (87,220 ) 884,870 (77,507 ) 3,386,510 (164,727 ) Manufacturing, construction and mining 2,045,859 (84,972 ) 349,738 (34,635 ) 2,395,597 (119,607 ) Utilities and related sectors 2,313,271 (82,119 ) 591,482 (45,838 ) 2,904,753 (127,957 ) Wholesale/retail trade 1,032,603 (51,228 ) 198,805 (26,326 ) 1,231,408 (77,554 ) Services, media and other 4,618,477 (196,520 ) 1,072,722 (152,364 ) 5,691,199 (348,884 ) Residential mortgage backed securities 145,613 (2,638 ) 22,689 (1,487 ) 168,302 (4,125 ) Commercial mortgage backed securities 2,141,560 (37,150 ) 2,090,835 (97,676 ) 4,232,395 (134,826 ) Other asset backed securities 4,073,249 (252,265 ) 271,994 (17,969 ) 4,345,243 (270,234 ) $ 19,341,518 $ (803,628 ) $ 6,619,197 $ (547,459 ) $ 25,960,715 $ (1,351,087 ) December 31, 2017 Fixed maturity securities: Available for sale: United States Government full faith and credit $ 1,565 $ (10 ) $ 6,731 $ (137 ) $ 8,296 $ (147 ) United States Government sponsored agencies 44,794 (180 ) 958,965 (31,550 ) 1,003,759 (31,730 ) United States municipalities, states and territories 44,736 (128 ) 128,499 (3,468 ) 173,235 (3,596 ) Foreign government obligations 49,663 (337 ) 12,625 (1,688 ) 62,288 (2,025 ) Corporate securities: Finance, insurance and real estate 456,244 (5,135 ) 600,655 (28,043 ) 1,056,899 (33,178 ) Manufacturing, construction and mining 222,985 (3,475 ) 231,196 (10,849 ) 454,181 (14,324 ) Utilities and related sectors 395,183 (4,099 ) 249,416 (8,901 ) 644,599 (13,000 ) Wholesale/retail trade 152,941 (1,249 ) 178,635 (11,371 ) 331,576 (12,620 ) Services, media and other 729,124 (19,000 ) 891,654 (53,565 ) 1,620,778 (72,565 ) Residential mortgage backed securities 39,771 (387 ) 32,917 (2,084 ) 72,688 (2,471 ) Commercial mortgage backed securities 1,096,757 (10,385 ) 1,306,437 (59,455 ) 2,403,194 (69,840 ) Other asset backed securities 765,531 (3,499 ) 217,595 (9,906 ) 983,126 (13,405 ) $ 3,999,294 $ (47,884 ) $ 4,815,325 $ (221,017 ) $ 8,814,619 $ (268,901 ) Held for investment: Corporate security: Insurance $ — $ — $ 76,460 $ (581 ) $ 76,460 $ (581 ) The unrealized losses at December 31, 2018 are principally related to timing of the purchases of these securities, which carry less yield than those available at December 31, 2018 . Approximately 87% and 83% of the unrealized losses on fixed maturity securities shown in the above table for December 31, 2018 and 2017 , respectively, are on securities that are rated investment grade, defined as being the highest two NAIC designations. All of the fixed maturity securities with unrealized losses are current with respect to the payment of principal and interest. Because we did not have the intent to sell fixed maturity securities with unrealized losses and it was not more likely than not that we would be required to sell these securities prior to recovery of the amortized cost, which may be maturity, we did not consider these investments to be other than temporarily impaired as of December 31, 2018 and 2017. Changes in net unrealized gains/losses on investments for the years ended December 31, 2018 , 2017 and 2016 are as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Fixed maturity securities held for investment carried at amortized cost $ 581 $ 7,478 $ 3,186 Investments carried at fair value: Fixed maturity securities, available for sale $ (2,463,693 ) $ 1,149,691 $ 508,410 Equity securities, available for sale — (479 ) 166 (2,463,693 ) 1,149,212 508,576 Adjustment for effect on other balance sheet accounts: Deferred policy acquisition costs and deferred sales inducements 1,318,649 (587,417 ) (295,802 ) Deferred income tax asset/liability 240,459 (177,162 ) (74,471 ) 1,559,108 (764,579 ) (370,273 ) Change in net unrealized gains/losses on investments carried at fair value $ (904,585 ) $ 384,633 $ 138,303 Components of net investment income are as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Fixed maturity securities $ 2,027,599 $ 1,876,542 $ 1,729,176 Equity securities 4,735 764 531 Mortgage loans on real estate 131,259 122,680 122,985 Cash and cash equivalents 2,320 2,562 3,201 Other 1,548 4,073 5,499 2,167,461 2,006,621 1,861,392 Less investment expenses (19,649 ) (14,624 ) (11,520 ) Net investment income $ 2,147,812 $ 1,991,997 $ 1,849,872 Proceeds from sales of available for sale securities for the years ended December 31, 2018 , 2017 and 2016 were $2.5 billion , $0.7 billion and $1.0 billion , respectively. Scheduled principal repayments, calls and tenders for available for sale fixed maturity securities for the years ended December 31, 2018 , 2017 and 2016 were $1.4 billion , $1.2 billion and $1.7 billion , respectively. Realized gains and losses on sales are determined on the basis of specific identification of investments based on the trade date. Net realized gains (losses) on investments, excluding net OTTI losses are as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Available for sale fixed maturity securities: Gross realized gains $ 12,245 $ 18,254 $ 14,132 Gross realized losses (47,974 ) (9,058 ) (4,036 ) (35,729 ) 9,196 10,096 Available for sale equity securities: Gross realized gains — 348 — Other investments: Gain on sale of real estate — 56 884 Loss on sale of real estate — — (93 ) — 56 791 Mortgage loans on real estate: Decrease (increase) in allowance for credit losses (3,165 ) 278 (4,846 ) Recovery of specific allowance 1,592 631 5,483 Gain on sale of mortgage loans 124 — — (1,449 ) 909 637 $ (37,178 ) $ 10,509 $ 11,524 Losses on available for sale fixed maturity securities in 2018 , 2017 and 2016 were realized primarily due to strategies to reposition the fixed maturity security portfolio that result in improved net investment income, credit risk or duration profiles as they pertain to our asset liability management. The following table summarizes the carrying value of our investments that have been non-income producing for 12 consecutive months: December 31, 2018 2017 (Dollars in thousands) Fixed maturity securities, available for sale $ 6,717 $ 8,680 We review and analyze all investments on an ongoing basis for changes in market interest rates and credit deterioration. This review process includes analyzing our ability to recover the amortized cost basis of each investment that has a fair value that is materially lower than its amortized cost and requires a high degree of management judgment and involves uncertainty. The evaluation of securities for other than temporary impairments is a quantitative and qualitative process, which is subject to risks and uncertainties. We have a policy and process to identify securities that could potentially have impairments that are other than temporary. This process involves monitoring market events and other items that could impact issuers. The evaluation includes but is not limited to such factors as: • the length of time and the extent to which the fair value has been less than amortized cost or cost; • whether the issuer is current on all payments and all contractual payments have been made as agreed; • the remaining payment terms and the financial condition and near-term prospects of the issuer; • the lack of ability to refinance due to liquidity problems in the credit market; • the fair value of any underlying collateral; • the existence of any credit protection available; • our intent to sell and whether it is more likely than not we would be required to sell prior to recovery for debt securities; • consideration of rating agency actions; and • changes in estimated cash flows of mortgage and asset backed securities. We determine whether other than temporary impairment losses should be recognized for debt securities by assessing all facts and circumstances surrounding each security. Where the decline in fair value of debt securities is attributable to changes in market interest rates or to factors such as market volatility, liquidity and spread widening, and we anticipate recovery of all contractual or expected cash flows, we do not consider these investments to be other than temporarily impaired because we do not intend to sell these investments and it is not more likely than not we will be required to sell these investments before a recovery of amortized cost, which may be maturity. If we intend to sell a debt security or if it is more likely than not that we will be required to sell a debt security before recovery of its amortized cost basis, other than temporary impairment has occurred and the difference between amortized cost and fair value will be recognized as a loss in operations. If we do not intend to sell and it is not more likely than not we will be required to sell the debt security but also do not expect to recover the entire amortized cost basis of the security, an impairment loss would be recognized in operations in the amount of the expected credit loss. We determine the amount of expected credit loss by calculating the present value of the cash flows expected to be collected discounted at each security's acquisition yield based on our consideration of whether the security was of high credit quality at the time of acquisition. The difference between the present value of expected future cash flows and the amortized cost basis of the security is the amount of credit loss recognized in operations. The remaining amount of the other than temporary impairment is recognized in other comprehensive income (loss). The determination of the credit loss component of a mortgage backed security is based on a number of factors. The primary consideration in this evaluation process is the issuer's ability to meet current and future interest and principal payments as contractually stated at time of purchase. Our review of these securities includes an analysis of the cash flow modeling under various default scenarios considering independent third party benchmarks, the seniority of the specific tranche within the structure of the security, the composition of the collateral and the actual default, loss severity and prepayment experience exhibited. With the input of third party assumptions for default projections, loss severity and prepayment expectations, we evaluate the cash flow projections to determine whether the security is performing in accordance with its contractual obligation. We utilize the models from a leading structured product software specialist serving institutional investors. These models incorporate each security's seniority and cash flow structure. In circumstances where the analysis implies a potential for principal loss at some point in the future, we use the "best estimate" cash flow projection discounted at the security's effective yield at acquisition to determine the amount of our potential credit loss associated with this security. The discounted expected future cash flows equates to our expected recovery value. Any shortfall of the expected recovery when compared to the amortized cost of the security will be recorded as the credit loss component of other than temporary impairment. The cash flow modeling is performed on a security-by-security basis and incorporates actual cash flows on the residential mortgage backed securities through the current period, as well as the projection of remaining cash flows using a number of assumptions including default rates, prepayment rates and loss severity rates. The default curves we use are tailored to the Prime or Alt-A residential mortgage backed securities that we own, which assume lower default rates and loss severity for Prime securities versus Alt-A securities. These default curves are scaled higher or lower depending on factors such as current underlying mortgage loan performance, rating agency loss projections, loan to value ratios, geographic diversity, as well as other appropriate considerations. The determination of the credit loss component of a corporate bond is based on the underlying financial performance of the issuer and their ability to meet their contractual obligations. Considerations in our evaluation include, but are not limited to, credit rating changes, financial statement and ratio analysis, changes in management, significant changes in credit spreads, breaches of financial covenants and a review of the economic outlook for the industry and markets in which they trade. In circumstances where an issuer appears unlikely to meet its future obligation, or the security's price decline is deemed other than temporary, an estimate of credit loss is determined. Credit loss is calculated using default probabilities as derived from the credit default swaps markets in conjunction with recovery rates derived from independent third party analysis or a best estimate of credit loss. This credit loss rate is then incorporated into a present value calculation based on an expected principal loss in the future discounted at the yield at the date of purchase and compared to amortized cost to determine the amount of credit loss associated with the security. In addition, for debt securities which we do not intend to sell and it is not more likely than not we will be required to sell, but our intent changes due to changes or events that could not have been reasonably anticipated, an other than temporary impairment charge is recognized. Once an impairment charge has been recorded, we then continue to review the other than temporarily impaired securities for appropriate valuation on an ongoing basis. Unrealized losses may be recognized in future periods through a charge to earnings should we later conclude that the decline in fair value below amortized cost is other than temporary pursuant to our accounting policy described above. The use of different methodologies and assumptions to determine the fair value of investments and the timing and amount of impairments may have a material effect on the amounts presented in our consolidated financial statements. The following table summarizes other than temporary impairments by asset type: Number of Securities Total OTTI Losses Portion of OTTI Losses Recognized in (from) Other Comprehensive Income Net OTTI Losses Recognized in Operations (Dollars in thousands) Year ended December 31, 2018 Fixed maturity securities, available for sale: Corporate securities: Capital goods 1 $ (719 ) $ — $ (719 ) Consumer discretionary 8 (9,533 ) — (9,533 ) Energy 4 (4,793 ) — (4,793 ) Financials 5 (3,495 ) — (3,495 ) Information technology 1 (550 ) — (550 ) Industrials 1 (2,299 ) — (2,299 ) Telecommunications 2 (249 ) — (249 ) Transportation 1 (178 ) — (178 ) Utilities 2 (5,518 ) — (5,518 ) Residential mortgage backed securities 3 (63 ) (295 ) (358 ) Commercial mortgage backed securities 5 (4,859 ) — (4,859 ) Other asset backed securities 2 (2,749 ) (1,356 ) (4,105 ) 35 $ (35,005 ) $ (1,651 ) $ (36,656 ) Year ended December 31, 2017 Fixed maturity securities, available for sale: Corporate securities: Industrials 1 $ (2,485 ) $ — $ (2,485 ) Residential mortgage backed securities 8 (273 ) (1,585 ) (1,858 ) Other asset backed securities 1 — (287 ) (287 ) 10 $ (2,758 ) $ (1,872 ) $ (4,630 ) Year ended December 31, 2016 Fixed maturity securities, available for sale: Corporate securities: Energy 2 $ (642 ) $ — $ (642 ) Materials 1 (4,554 ) 1,575 (2,979 ) Telecommunications 1 (4,462 ) 562 (3,900 ) Utilities 2 (6,961 ) 798 (6,163 ) Residential mortgage backed securities 9 — (783 ) (783 ) Commercial mortgage backed securities 5 (1,540 ) — (1,540 ) Other asset backed securities 2 (3,190 ) (3,482 ) (6,672 ) 22 $ (21,349 ) $ (1,330 ) $ (22,679 ) The cumulative portion of other than temporary impairments determined to be credit losses which have been recognized in operations for debt securities are summarized as follows: Year Ended December 31, 2018 2017 (Dollars in thousands) Cumulative credit loss at beginning of year $ (157,066 ) $ (166,375 ) Additions for the amount related to credit losses for which OTTI has not previously been recognized (35,005 ) (2,758 ) Additional credit losses on securities for which OTTI has previously been recognized (1,651 ) (1,872 ) Accumulated losses on securities that were disposed of during the period 18,324 13,939 Cumulative credit loss at end of year $ (175,398 ) $ (157,066 ) The following table summarizes the cumulative noncredit portion of OTTI and the change in fair value since recognition of OTTI, both of which were recognized in other comprehensive income, by major type of security, for securities that are part of our investment portfolio at December 31, 2018 and 2017 : Amortized Cost OTTI Recognized in Other Comprehensive Income (Loss) Change in Fair Value Since OTTI was Recognized Fair Value (Dollars in thousands) December 31, 2018 Fixed maturity securities, available for sale: Corporate securities $ 69,580 $ (3,700 ) $ 6,195 $ 72,075 Residential mortgage backed securities 245,691 (167,846 ) 199,191 277,036 Commercial mortgage backed securities 35,244 — — 35,244 Other asset backed securities 1,692 — 326 2,018 $ 352,207 $ (171,546 ) $ 205,712 $ 386,373 December 31, 2017 Fixed maturity securities, available for sale: Corporate securities $ 13,015 $ (4,263 ) $ 10,739 $ 19,491 Residential mortgage backed securities 297,582 (168,355 ) 201,620 330,847 Other asset backed securities 4,567 (1,356 ) (1,875 ) 1,336 $ 315,164 $ (173,974 ) $ 210,484 $ 351,674 At December 31, 2018 and 2017 , fixed maturity securities and short-term investments with an amortized cost of $49.2 billion and $47.5 billion , respectively, were on deposit with state agencies to meet regulatory requirements. There are no restrictions on these assets. At December 31, 2018 and 2017 , we had no investment in any person or its affiliates (other than bonds issued by agencies of the United States Government) that exceeded 10% of stockholders' equity. |
Mortgage Loans on Real Estate
Mortgage Loans on Real Estate | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Mortgage Loans on Real Estate | Mortgage Loans on Real Estate Our mortgage loan portfolio is summarized in the following table. There were commitments outstanding of $148.0 million at December 31, 2018 . December 31, 2018 2017 (Dollars in thousands) Principal outstanding $ 2,952,464 $ 2,674,315 Loan loss allowance (8,239 ) (7,518 ) Deferred prepayment fees (1,134 ) (1,266 ) Carrying value $ 2,943,091 $ 2,665,531 The portfolio consists of commercial mortgage loans collateralized by the related properties and diversified as to property type, location and loan size. Our mortgage lending policies establish limits on the amount that can be loaned to one borrower and other criteria to attempt to reduce the risk of default. The mortgage loan portfolio is summarized by geographic region and property type as follows: December 31, 2018 2017 Principal Percent Principal Percent (Dollars in thousands) Geographic distribution East $ 586,773 19.9 % $ 548,067 20.5 % Middle Atlantic 168,969 5.7 % 163,485 6.1 % Mountain 357,642 12.1 % 308,486 11.5 % New England 9,418 0.3 % 12,265 0.5 % Pacific 521,363 17.7 % 466,030 17.4 % South Atlantic 694,599 23.5 % 609,736 22.8 % West North Central 291,890 9.9 % 324,808 12.2 % West South Central 321,810 10.9 % 241,438 9.0 % $ 2,952,464 100.0 % $ 2,674,315 100.0 % Property type distribution Office $ 268,932 9.1 % $ 283,926 10.6 % Medical Office 33,467 1.1 % 34,338 1.3 % Retail 1,091,627 37.0 % 1,040,028 38.9 % Industrial/Warehouse 762,887 25.8 % 677,770 25.3 % Apartment 600,638 20.3 % 462,897 17.3 % Agricultural 25,000 0.9 % — — % Mixed use/Other 169,913 5.8 % 175,356 6.6 % $ 2,952,464 100.0 % $ 2,674,315 100.0 % Our financing receivables currently consist of one portfolio segment which is our commercial mortgage loan portfolio. These are mortgage loans with collateral consisting of commercial real estate and borrowers consisting mostly of limited liability partnerships or limited liability corporations. We evaluate our mortgage loan portfolio for the establishment of a loan loss allowance by specific identification of impaired loans and the measurement of an estimated loss for each individual loan identified. A mortgage loan is impaired when it is probable that we will be unable to collect all amounts due according to the contractual terms of the loan agreement. If we determine that the value of any specific mortgage loan is impaired, the carrying amount of the mortgage loan will be reduced to its fair value, based upon the present value of expected future cash flows from the loan discounted at the loan's effective interest rate, or the fair value of the underlying collateral less estimated costs to sell. In addition, we analyze the mortgage loan portfolio for the need of a general loan allowance for probable losses on all other loans on a quantitative and qualitative basis. The amount of the general loan allowance is based upon management's evaluation of the collectability of the loan portfolio, historical loss experience, delinquencies, credit concentrations, underwriting standards and national and local economic conditions. We rate each of the mortgage loans in our portfolio based on factors such as historical operating performance, loan to value ratio and economic outlook, among others. We calculate a loss factor to apply to each rating based on historical losses we have recognized in our mortgage loan portfolio. We apply the loss factors to the total principal outstanding within each rating category to determine an appropriate estimate of the general loan loss allowance. We also assess the portfolio qualitatively and apply a loss rate to all loans without a specific allowance based on management's assessment of economic conditions, and we apply an additional amount of loss allowance to a group of loans that we have identified as having higher risk of loss. The following table presents a rollforward of our specific and general valuation allowances for mortgage loans on real estate: Year Ended December 31, 2018 2017 2016 Specific Allowance General Allowance Specific Allowance General Allowance Specific Allowance General Allowance (Dollars in thousands) Beginning allowance balance $ (1,418 ) $ (6,100 ) $ (1,327 ) $ (7,100 ) $ (7,842 ) $ (6,300 ) Charge-offs 852 — — — 5,078 — Recoveries 1,592 — 631 — 5,483 — Change in provision for credit losses (1,255 ) (1,910 ) (722 ) 1,000 (4,046 ) (800 ) Ending allowance balance $ (229 ) $ (8,010 ) $ (1,418 ) $ (6,100 ) $ (1,327 ) $ (7,100 ) The specific allowance represents the total credit loss allowances on loans which are individually evaluated for impairment. The general allowance is for the group of loans discussed above which are collectively evaluated for impairment. The following table presents the total outstanding principal of loans evaluated for impairment by basis of impairment method: December 31, 2018 2017 2016 (Dollars in thousands) Individually evaluated for impairment $ 1,253 $ 5,445 $ 4,640 Collectively evaluated for impairment 2,951,211 2,668,870 2,485,979 Total loans evaluated for impairment $ 2,952,464 $ 2,674,315 $ 2,490,619 Charge-offs include allowances that have been established on loans that were satisfied either by taking ownership of the collateral or by some other means such as discounted pay-off or loan sale. When ownership of the property is taken it is recorded at the lower of the mortgage loan's carrying value or the property's fair value (based on appraised values) less estimated costs to sell. The real estate owned is recorded as a component of Other investments and the mortgage loan is recorded as fully paid, with any allowance for credit loss that has been established charged off. Fair value of the real estate is determined by third party appraisal. Recoveries are situations where we have received a payment from the borrower in an amount greater than the carrying value of the loan (principal outstanding less specific allowance). We did not own any real estate during the years ended December 31, 2018 and 2017 . We owned one real estate property during the year ended December 31, 2016, which was sold prior to the end of 2016. We analyze credit risk of our mortgage loans by analyzing all available evidence on loans that are delinquent and loans that are in a workout period. December 31, 2018 2017 (Dollars in thousands) Credit Exposure - By Payment Activity Performing $ 2,952,464 $ 2,670,657 In workout — 1,436 Collateral dependent — 2,222 $ 2,952,464 $ 2,674,315 The loans that are categorized as "in workout" consist of loans that we have agreed to lower or no mortgage payments for a period of time while the borrowers address cash flow and/or operational issues. The key features of these workouts have been determined on a loan-by-loan basis. Most of these loans are in a period of low cash flow due to tenants vacating their space or tenants requesting rent relief during difficult economic periods. Generally, we have allowed the borrower a six month interest only period and in some cases a twelve month period of interest only. Interest only workout loans are expected to return to their regular debt service payments after the interest only period. Interest only loans that are not fully amortizing will have a larger balance at their balloon date than originally contracted. Fully amortizing loans that are in interest only periods will have larger debt service payments for their remaining term due to lost principal payments during the interest only period. In limited circumstances we have allowed borrowers to pay the principal portion of their loan payment into an escrow account that can be used for capital and tenant improvements for a period of not more than twelve months. In these situations new loan amortization schedules are calculated based on the principal not collected during this twelve month workout period and larger payments are collected for the remaining term of each loan. In all cases, the original interest rate and maturity date have not been modified, and we have not forgiven any principal amounts. Mortgage loans are considered delinquent when they become 60 days or more past due. In general, when loans become 90 days past due, become collateral dependent or enter a period with no debt service payments required we place them on non-accrual status and discontinue recognizing interest income. If payments are received on a delinquent loan, interest income is recognized to the extent it would have been recognized if normal principal and interest would have been received timely. If the payments are received to bring a delinquent loan back to current we will resume accruing interest income on that loan. There were no loans in non-accrual status at December 31, 2018 . There were $2.2 million loans in non-accrual status at December 31, 2017 . We define collateral dependent loans as those mortgage loans for which we will depend on the value of the collateral real estate to satisfy the outstanding principal of the loan. All of our commercial mortgage loans depend on the cash flow of the borrower to be at a sufficient level to service the principal and interest payments as they come due. In general, cash inflows of the borrowers are generated by collecting monthly rent from tenants occupying space within the borrowers' properties. Our borrowers face collateral risks such as tenants going out of business, tenants struggling to make rent payments as they become due, and tenants canceling leases and moving to other locations. We have a number of loans where the real estate is occupied by a single tenant. Our borrowers sometimes face both a reduction in cash flow on their mortgage property as well as a reduction in the fair value of the real estate collateral. If borrowers are unable to replace lost rent revenue and increases in the fair value of their property do not materialize, we could potentially incur more losses than what we have allowed for in our specific and general loan loss allowances. Aging of financing receivables is summarized in the following table, with loans in a "workout" period as of the reporting date considered current if payments are current in accordance with agreed upon terms: 30 - 59 Days 60 - 89 Days 90 Days and Over Total Past Due Current Collateral Dependent Receivables Total Financing Receivables (Dollars in thousands) Commercial Mortgage Loans December 31, 2018 $ — $ — $ — $ — $ 2,952,464 $ — $ 2,952,464 December 31, 2017 $ — $ — $ — $ — $ 2,672,093 $ 2,222 $ 2,674,315 Financing receivables summarized in the following two tables represent all loans that we are either not currently collecting, or those we feel it is probable we will not collect all amounts due according to the contractual terms of the loan agreements (all loans that we have worked with the borrower to alleviate short-term cash flow issues, loans delinquent for 60 days or more at the reporting date, loans we have determined to be collateral dependent and loans that we have recorded specific impairments on that we feel may continue to have performance issues). Recorded Investment Unpaid Principal Balance Related Allowance (Dollars in thousands) December 31, 2018 Mortgage loans with an allowance $ 1,024 $ 1,253 $ (229 ) Mortgage loans with no related allowance — — — $ 1,024 $ 1,253 $ (229 ) December 31, 2017 Mortgage loans with an allowance $ 4,027 $ 5,445 $ (1,418 ) Mortgage loans with no related allowance 1,436 1,436 — $ 5,463 $ 6,881 $ (1,418 ) Average Recorded Investment Interest Income Recognized (Dollars in thousands) December 31, 2018 Mortgage loans with an allowance $ 1,042 $ 74 Mortgage loans with no related allowance — — $ 1,042 $ 74 December 31, 2017 Mortgage loans with an allowance $ 4,464 $ 221 Mortgage loans with no related allowance 1,513 91 $ 5,977 $ 312 December 31, 2016 Mortgage loans with an allowance $ 3,398 $ 301 Mortgage loans with no related allowance 1,665 73 $ 5,063 $ 374 A Troubled Debt Restructuring ("TDR") is a situation where we have granted a concession to a borrower for economic or legal reasons related to the borrower's financial difficulties that we would not otherwise consider. A mortgage loan that has been granted new terms, including workout terms as described previously, would be considered a TDR if it meets conditions that would indicate a borrower is experiencing financial difficulty and the new terms constitute a concession on our part. We analyze all loans where we have agreed to workout terms and all loans that we have refinanced to determine if they meet the definition of a TDR. We consider the following factors in determining whether or not a borrower is experiencing financial difficulty: • borrower is in default, • borrower has declared bankruptcy, • there is growing concern about the borrower's ability to continue as a going concern, • borrower has insufficient cash flows to service debt, • borrower's inability to obtain funds from other sources, and • there is a breach of financial covenants by the borrower. If the borrower is determined to be in financial difficulty, we consider the following conditions to determine if the borrower is granted a concession: • assets used to satisfy debt are less than our recorded investment, • interest rate is modified, • maturity date extension at an interest rate less than market rate, • capitalization of interest, • delaying principal and/or interest for a period of three months or more, and • partial forgiveness of the balance or charge-off. Mortgage loan workouts, refinances or restructures that are classified as TDRs are individually evaluated and measured for impairment. There were no mortgage loans on commercial real estate that we determined to be a TDR at December 31, 2018 . A summary of mortgage loans on commercial real estate with outstanding principal at December 31, 2017 that we determined to be TDRs are as follows: Geographic Region Number of TDRs Principal Balance Outstanding Specific Loan Loss Allowance Net Carrying Amount (Dollars in thousands) Year ended December 31, 2017 South Atlantic 1 $ 2,947 $ — $ 2,947 East 1 1,933 (467 ) 1,466 2 $ 4,880 $ (467 ) $ 4,413 |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments None of our derivatives qualify for hedge accounting, thus, any change in the fair value of the derivatives is recognized immediately in the consolidated statements of operations. The fair value of our derivative instruments, including derivative instruments embedded in fixed index annuity contracts, presented in the consolidated balance sheets are as follows: December 31, 2018 2017 (Dollars in thousands) Assets Derivative instruments Call options $ 205,149 $ 1,568,380 Other assets Interest rate caps 597 415 Interest rate swap 354 — $ 206,100 $ 1,568,795 Liabilities Policy benefit reserves - annuity products Fixed index annuities - embedded derivatives, net $ 8,165,405 $ 8,790,427 Other liabilities Interest rate swap — 789 $ 8,165,405 $ 8,791,216 The changes in fair value of derivatives included in the consolidated statements of operations are as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Change in fair value of derivatives: Call options $ (778,899 ) $ 1,678,283 $ 165,029 Interest rate swap 869 255 (482 ) Interest rate caps 182 (667 ) (328 ) $ (777,848 ) $ 1,677,871 $ 164,219 Change in fair value of embedded derivatives: Fixed index annuities - embedded derivatives (see Note 2) $ (2,167,628 ) $ 174,154 $ 145,045 Other changes in difference between policy benefit reserves computed using derivative accounting vs. long-duration contracts accounting 778,137 745,581 398,420 $ (1,389,491 ) $ 919,735 $ 543,465 The amounts presented as "Other changes in difference between policy benefit reserves computed using derivative accounting vs. long-duration contracts accounting" represents the total change in the difference between policy benefit reserves for fixed index annuities computed under the derivative accounting standard and the long-duration contracts accounting standard at each balance sheet date, less the change in fair value of our fixed index annuities embedded derivatives that is presented as Level 3 liabilities in Note 2. We have fixed index annuity products that guarantee the return of principal to the policyholder and credit interest based on a percentage of the gain in a specified market index. When fixed index annuity deposits are received, a portion of the deposit is used to purchase derivatives consisting of call options on the applicable market indices to fund the index credits due to fixed index annuity policyholders. Substantially all such call options are one year options purchased to match the funding requirements of the underlying policies. The call options are marked to fair value with the change in fair value included as a component of revenues. The change in fair value of derivatives includes the gains or losses recognized at the expiration of the option term and the changes in fair value for open positions. On the respective anniversary dates of the index policies, the index used to compute the index credit is reset and we purchase new call options to fund the next index credit. We manage the cost of these purchases through the terms of our fixed index annuities, which permit us to change caps, participation rates, and/or asset fees, subject to guaranteed minimums on each policy's anniversary date. By adjusting caps, participation rates, or asset fees, we can generally manage option costs except in cases where the contractual features would prevent further modifications. Our strategy attempts to mitigate any potential risk of loss due to the nonperformance of the counterparties to these call options through a regular monitoring process which evaluates the program's effectiveness. We do not purchase call options that would require payment or collateral to another institution and our call options do not contain counterparty credit-risk-related contingent features. We are exposed to risk of loss in the event of nonperformance by the counterparties and, accordingly, we purchase our option contracts from multiple counterparties and evaluate the creditworthiness of all counterparties prior to purchase of the contracts. All of these options have been purchased from nationally recognized financial institutions with a Standard and Poor's credit rating of A- or higher at the time of purchase and the maximum credit exposure to any single counterparty is subject to concentration limits. We also have credit support agreements that allow us to request the counterparty to provide collateral to us when the fair value of our exposure to the counterparty exceeds specified amounts. The notional amount and fair value of our call options by counterparty and each counterparty's current credit rating are as follows: December 31, 2018 2017 Counterparty Credit Rating (S&P) Credit Rating (Moody's) Notional Amount Fair Value Notional Amount Fair Value (Dollars in thousands) Bank of America A+ Aa3 $ 6,518,808 $ 6,704 $ 4,645,366 $ 237,955 Barclays A A2 2,301,414 27,032 4,135,537 154,127 BNP Paribas A Aa3 — — 1,411,989 73,650 Canadian Imperial Bank of Commerce A+ Aa2 4,856,150 29,313 2,808,030 84,268 Citibank, N.A. A+ A1 4,792,208 27,239 4,104,666 219,900 Credit Suisse A A1 2,877,916 12,887 3,538,855 137,384 J.P. Morgan A+ Aa2 3,701,964 17,564 1,753,649 109,689 Morgan Stanley A+ A1 3,560,044 1,561 3,408,179 184,323 Royal Bank of Canada AA- A2 1,871,305 14,011 3,027,469 104,141 Societe Generale A A1 2,343,165 21,681 — — SunTrust A- Baa1 1,755,030 12,047 2,331,168 90,399 Wells Fargo A+ Aa2 4,618,569 33,398 4,036,255 162,781 Exchange traded 224,204 1,712 296,840 9,763 $ 39,420,777 $ 205,149 $ 35,498,003 $ 1,568,380 As of December 31, 2018 and 2017 , we held $0.2 billion and $1.6 billion , respectively, of cash and cash equivalents and other securities from counterparties for derivative collateral, which is included in Other liabilities on our consolidated balance sheets. This derivative collateral limits the maximum amount of economic loss due to credit risk that we would incur if parties to the call options failed completely to perform according to the terms of the contracts to $16.1 million and $11.9 million at December 31, 2018 and 2017 , respectively. The future index credits on our fixed index annuities are treated as a "series of embedded derivatives" over the expected life of the applicable contract. We do not purchase call options to fund the index liabilities which may arise after the next policy anniversary date. We must value both the call options and the related forward embedded options in the policies at fair value. We entered into an interest rate swap and interest rate caps to manage interest rate risk associated with the floating rate component on certain of our subordinated debentures. See Note 10 for more information on our subordinated debentures. The terms of the interest rate swap provide that we pay a fixed rate of interest and receive a floating rate of interest. The terms of the interest rate caps limit the three month LIBOR to 2.50% . The interest rate swap and caps are not effective hedges under accounting guidance for derivative instruments and hedging activities. Therefore, we record the interest rate swap and caps at fair value and any net cash payments received or paid are included in the change in fair value of derivatives in the consolidated statements of operations. Details regarding the interest rate swap are as follows: December 31, 2018 2017 Maturity Date Notional Amount Receive Rate Pay Rate Counterparty Fair Value Fair Value (Dollars in thousands) March 15, 2021 $ 85,500 LIBOR 2.415% SunTrust $ 354 $ (789 ) Details regarding the interest rate caps are as follows: December 31, 2018 2017 Maturity Date Notional Amount Floating Rate Cap Rate Counterparty Fair Value Fair Value (Dollars in thousands) July 7, 2021 $ 40,000 LIBOR 2.50% SunTrust $ 302 $ 207 July 8, 2021 12,000 LIBOR 2.50% SunTrust 91 62 July 29, 2021 27,000 LIBOR 2.50% SunTrust 204 146 $ 79,000 $ 597 $ 415 The interest rate swap converts floating rates to fixed rates for seven years which began in March 2014. The interest rate caps cap our interest rates for seven years which began in July 2014. |
Deferred Policy Acquisition Cos
Deferred Policy Acquisition Costs, Deferred Sales Inducements and Liability for Lifetime Income Benefit Riders | 12 Months Ended |
Dec. 31, 2018 | |
Insurance [Abstract] | |
Deferred Policy Acquisition Costs, Deferred Sales Inducements and Liability for Lifetime Income Benefit Riders | Deferred Policy Acquisition Costs, Deferred Sales Inducements and Liability for Lifetime Income Benefit Riders Policy acquisition costs deferred and amortized are as follows: December 31, 2018 2017 2016 (Dollars in thousands) Balance at beginning of year $ 2,714,523 $ 2,905,377 $ 2,905,136 Costs deferred during the year: Commissions 384,432 401,124 538,863 Policy issue costs 3,790 5,517 4,462 Amortization: Amortization (358,563 ) (304,162 ) (325,848 ) Impact of unlocking 30,572 48,198 (48,164 ) Effect of net unrealized gains/losses 761,084 (341,531 ) (169,072 ) Balance at end of year $ 3,535,838 $ 2,714,523 $ 2,905,377 Sales inducements deferred and amortized are as follows: December 31, 2018 2017 2016 (Dollars in thousands) Balance at beginning of year $ 2,001,892 $ 2,208,218 $ 2,232,148 Costs deferred during the year 179,465 216,172 353,966 Amortization: Amortization (243,666 ) (210,886 ) (215,406 ) Impact of unlocking 21,465 34,274 (35,760 ) Effect of net unrealized gains/losses 557,565 (245,886 ) (126,730 ) Balance at end of year $ 2,516,721 $ 2,001,892 $ 2,208,218 The following table presents a rollforward of the liability for lifetime income benefit riders (net of coinsurance ceded): December 31, 2018 2017 2016 (Dollars in thousands) Balance at beginning of year $ 704,441 $ 533,391 $ 351,946 Benefit expense accrual 157,333 149,442 139,443 Impact of unlocking (53,607 ) 21,608 42,002 Claim payments — — — Balance at end of year $ 808,167 $ 704,441 $ 533,391 We periodically revise the key assumptions used in the calculation of amortization of deferred policy acquisition costs and deferred sales inducements retrospectively through an unlocking process when estimates of current or future gross profits/margins (including the impact of realized investment gains and losses) to be realized from a group of products are revised. In addition, we periodically revise the assumptions used in determining the liability for lifetime income benefit riders as experience develops that is different from our assumptions. The most significant revisions made during 2018 as a result of our quarterly reviews were account balance true-ups which were favorable to us due to stronger index credits than we assumed due to strong equity market performance and adjustments to generally decrease lapse rate assumptions to reflect better persistency experienced than assumed. The favorable impact of the account balance true-ups and lapse rate assumption changes was partially offset by revisions to lower our future investment spread assumptions primarily due to an increase in the cost of money we have been experiencing. The most significant revisions made during 2017 as a result of our quarterly reviews were account balance true-ups which were favorable to us due to stronger index credits than we assumed due to strong equity market performance and adjustments to generally decrease lapse rate assumptions to reflect better persistency experienced than assumed. The favorable impact of the account balance true-ups and lapse rate assumption changes was partially offset by reductions in estimated future gross profits attributable to revisions to assumptions used in determining the liability for lifetime income benefit riders as well as an increase in estimated expenses associated with a reinsurance agreement with an unaffiliated reinsurer. The most significant revisions during 2016 as a result of our quarterly reviews were adjustments to lower future spread assumptions as actual investment spreads being earned showed investment spread and gross profits being less than what we were assuming in our models due to decreases in the average yield on invested assets resulting from the continued low interest rate environment. We also made adjustments to extend the period of time in which we assume investment spread will grade up to our long-term spread targets by an additional two years as yields obtained on investment purchases were much lower than we had anticipated as a result of the overall decline in investment yields that followed the Brexit vote. In addition, revisions to assumptions used in determining the liability for lifetime income benefit riders during 2016 resulted in a decrease in estimated future gross profits. The 2018 , 2017 and 2016 revisions to the liability for lifetime income benefit riders were consistent with the revisions used in the calculation of amortization of deferred policy acquisition costs and deferred sales inducements described above. The 2018 revisions were primarily attributable to account balance true-ups and future investment spread assumptions. The impact of the account balance true-ups and future investment spread changes was partially offset by the lapse rate assumptions changes described above. The 2017 revisions were primarily due to the lapse rate assumption changes described above and changes to our account value growth projections. The 2016 revisions were primarily due to actual index credits on policies being lower than projected over the past four quarters. |
Reinsurance and Policy Provisio
Reinsurance and Policy Provisions | 12 Months Ended |
Dec. 31, 2018 | |
Reinsurance Disclosures [Abstract] | |
Reinsurance and Policy Provisions | Reinsurance and Policy Provisions Coinsurance We have two coinsurance agreements with EquiTrust Life Insurance Company ("EquiTrust"), covering 70% of certain of American Equity Life's fixed index and fixed rate annuities issued from August 1, 2001 through December 31, 2001, 40% of those contracts issued during 2002 and 2003, and 20% of those contracts issued from January 1, 2004 to July 31, 2004. The business reinsured under these agreements may not be recaptured. Coinsurance deposits (aggregate policy benefit reserves transferred to EquiTrust under these agreements) were $560.8 million and $649.9 million at December 31, 2018 and 2017 , respectively. We remain liable to policyholders with respect to the policy liabilities ceded to EquiTrust should EquiTrust fail to meet the obligations it has coinsured. None of the coinsurance deposits with EquiTrust are deemed by management to be uncollectible. The balance due under these agreements to EquiTrust was $2.2 million and $11.0 million at December 31, 2018 and 2017 , respectively, and represents the fair value of call options held by us to fund index credits related to the ceded business net of cash due to or from EquiTrust related to monthly settlements of policy activity and other expenses. We have three coinsurance agreements with Athene Life Re Ltd. ("Athene"), an unauthorized life reinsurer domiciled in Bermuda. One agreement ceded 20% of certain of American Equity Life's fixed index annuities issued from January 1, 2009 through March 31, 2010. The business reinsured under this agreement is no longer eligible for recapture. The second agreement ceded 80% of American Equity Life's multi-year rate guaranteed annuities issued from July 1, 2009 through December 31, 2013 and 80% of Eagle Life's multi-year rate guaranteed annuities issued from November 20, 2013 through December 31, 2013. The business reinsured under this agreement may not be recaptured. The third agreement cedes 80% of American Equity Life's and Eagle Life's multi-year rate guaranteed annuities issued on or after January 1, 2014, 80% of Eagle Life's fixed index annuities issued prior to January 1, 2017, 50% of Eagle Life's fixed index annuities issued from January 1, 2017 through December 31, 2018 and 80% of certain of American Equity Life's fixed index annuities issued from August 1, 2016 through December 31, 2016. The reinsurance agreement specifies that the coinsurance percentage for Eagle Life's fixed index annuities decreases to 20% for policies issued on or after January 1, 2019. The business reinsured under this agreement may not be recaptured. Coinsurance deposits (aggregate policy benefit reserves transferred to Athene under these agreements) were $4.4 billion and $4.2 billion at December 31, 2018 and 2017 , respectively. American Equity Life is an intermediary for reinsurance of Eagle Life's business ceded to Athene. American Equity Life and Eagle Life remain liable to policyholders with respect to the policy liabilities ceded to Athene should Athene fail to meet the obligations it has coinsured. The annuity deposits that have been ceded to Athene are held in trusts and American Equity Life is named as the sole beneficiary of the trusts. The assets in the trusts are required to remain at a value that is sufficient to support the current balance of policy benefit liabilities of the ceded business on a statutory basis. If the value of the trust accounts would ever be less than the amount of the ceded policy benefit liabilities on a statutory basis, Athene is required to either establish a letter of credit or deposit securities in the trusts for the amount of any shortfall. None of the coinsurance deposits with Athene are deemed by management to be uncollectible. The balance due under these agreements to Athene was $16.2 million and $79.9 million at December 31, 2018 and 2017 , respectively, and represents the fair value of call options held by us to fund index credits related to the ceded business net of cash due from Athene related to monthly settlements of policy activity. Amounts ceded to EquiTrust and Athene under these agreements are as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Consolidated Statements of Operations Annuity product charges $ 7,074 $ 6,458 $ 5,366 Change in fair value of derivatives (41,487 ) 94,382 18,446 $ (34,413 ) $ 100,840 $ 23,812 Interest sensitive and index product benefits $ 165,485 $ 177,332 $ 93,487 Change in fair value of embedded derivatives (92,649 ) 35,561 23,848 Other operating costs and expenses 20,415 19,877 24,039 $ 93,251 $ 232,770 $ 141,374 Consolidated Statements of Cash Flows Annuity deposits $ (413,222 ) $ (387,280 ) $ (1,736,054 ) Cash payments to policyholders 389,384 380,683 418,499 $ (23,838 ) $ (6,597 ) $ (1,317,555 ) Financing Arrangements We have a reinsurance transaction with Hannover Life Reassurance Company of America ("Hannover"), which is treated as reinsurance under statutory accounting practices and as a financing arrangement under GAAP. The statutory surplus benefit under this agreement is eliminated under GAAP and the associated charges are recorded as risk charges and included in other operating costs and expenses in the consolidated statements of operations. The transaction became effective July 1, 2013 (the "2013 Hannover Transaction"). The 2013 Hannover Transaction, which was amended effective October 1, 2016, is a yearly renewable term reinsurance agreement for statutory purposes covering 45.6% of waived surrender charges related to penalty free withdrawals, deaths and lifetime income benefit rider payments as well as lifetime income benefit rider payments in excess of policy fund values on certain business. We may recapture the risks reinsured under this agreement as of the end of any quarter after December 31, 2020 and the agreement, as amended, makes it punitive to us if we do not recapture the business ceded no later than the first quarter of 2021. The reserve credit recorded on a statutory basis by American Equity Life was $780.0 million and $737.3 million at December 31, 2018 and 2017 , respectively. We pay quarterly reinsurance premiums under this agreement with an experience refund calculated on a quarterly basis and a risk charge based on the pretax statutory benefit as of the end of each calendar quarter. Risk charges attributable to the 2013 Hannover Transaction were $30.8 million , $28.5 million , and $27.7 million during 2018 , 2017 and 2016 , respectively. Indemnity Reinsurance In the normal course of business, we seek to limit our exposure to loss on any single insured and to recover a portion of benefits paid under our annuity, life and accident and health insurance products by ceding reinsurance to other insurance enterprises or reinsurers. Reinsurance contracts do not relieve us of our obligations to our policyholders. To the extent that reinsuring companies are later unable to meet obligations under reinsurance agreements, our life insurance subsidiaries would be liable for these obligations, and payment of these obligations could result in losses to us. To limit the possibility of such losses, we evaluate the financial condition of our reinsurers, and monitor concentrations of credit risk. No allowance for uncollectible amounts has been established against our asset for amounts receivable from other insurance companies as none of the receivables are deemed by management to be uncollectible. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We file consolidated federal income tax returns that include all of our wholly-owned subsidiaries. Our income tax expense as presented in the consolidated financial statements is summarized as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Consolidated statements of operations: Current income taxes $ 120,289 $ 188,356 $ 57,412 Deferred income taxes (benefits) (12,563 ) (46,730 ) (10,408 ) Total income tax expense included in consolidated statements of operations 107,726 141,626 47,004 Stockholders' equity: Expense (benefit) relating to: Change in net unrealized investment losses (240,459 ) 177,162 74,471 Share-based compensation — — (527 ) Total income tax expense (benefit) included in consolidated financial statements $ (132,733 ) $ 318,788 $ 120,948 Income tax expense in the consolidated statements of operations differed from the amount computed at the applicable statutory federal income tax rates of 21% for the year ended December 31, 2018 and 35% for the years ended December 31, 2017 and 2016 as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Income before income taxes $ 565,742 $ 316,271 $ 130,247 Income tax expense on income before income taxes $ 118,806 $ 110,695 $ 45,586 Tax effect of: State income taxes 5,777 1,961 2,559 Tax exempt net investment income (4,223 ) (4,288 ) (2,167 ) Impact of Tax Reform — 35,932 — Worthless stock deduction (7,448 ) — — Other (5,186 ) (2,674 ) 1,026 Income tax expense $ 107,726 $ 141,626 $ 47,004 Effective tax rate 19.0 % 44.8 % 36.1 % Tax Reform was enacted on December 22, 2017, reducing the statutory federal income tax rate from 35% to 21% effective January 1, 2018. The primary impact on our 2017 financial results was the impact of the reduction in the U.S. statutory tax rate from 35% to 21% on our deferred tax balances as of December 31, 2017. Deferred income tax assets or liabilities are established for temporary differences between the financial reporting amounts and tax bases of assets and liabilities that will result in deductible or taxable amounts, respectively, in future years. The tax effects of temporary differences that give rise to the deferred tax assets and liabilities at December 31, 2018 and 2017 , are as follows: December 31, 2018 2017 (Dollars in thousands) Deferred income tax assets: Policy benefit reserves $ 1,538,371 $ 1,842,049 Other than temporary impairments 9,804 11,262 Net unrealized losses on available for sale securities 19,928 — Derivative instruments 141,075 — Amounts due reinsurer — 6,852 Other policyholder funds 3,368 3,724 Deferred compensation 3,334 3,827 Share-based compensation 3,169 3,383 State net operating loss carryforwards 2,286 3,196 Other 9,439 10,253 Gross deferred tax assets 1,730,774 1,884,546 Deferred income tax liabilities: Deferred policy acquisition costs and deferred sales inducements (1,214,998 ) (1,212,509 ) Net unrealized gains on available for sale fixed maturity and equity securities — (220,533 ) Derivative instruments — (179,776 ) Policy benefit reserves (172,578 ) (197,233 ) Investment income items (37,795 ) (34,849 ) Amounts due reinsurer (12,620 ) — Other (1,614 ) (1,499 ) Gross deferred tax liabilities (1,439,605 ) (1,846,399 ) Net deferred income tax asset $ 291,169 $ 38,147 Included in the deferred income taxes is the expected income tax benefit attributable to unrealized losses on available for sale fixed maturity securities. There is no valuation allowance provided for the deferred income tax asset attributable to unrealized losses on available for sale fixed maturity securities. Management expects that the passage of time will result in the reversal of these unrealized losses due to the fair value increasing as these securities near maturity. We have the intent and ability to hold these securities to maturity, because we generate adequate cash flow from new business to fund all foreseeable cash flow needs and do not believe it would be necessary to liquidate these securities at a loss to meet cash flow needs. In addition, we have the ability to sell fixed maturity securities in unrealized gain positions to offset realized deferred income tax assets attributable to unrealized losses on available for sale fixed maturity securities. Realization of our deferred income tax assets is more likely than not based on expectations as to our future taxable income and considering all other available evidence, both positive and negative. Therefore, no valuation allowance against deferred income tax assets has been established as of December 31, 2018 and 2017 . There were no material income tax contingencies requiring recognition in our consolidated financial statements as of December 31, 2018 . We are no longer subject to income tax examinations by tax authorities for years 2014 and prior. At December 31, 2018 , we have no net operating loss carryforwards for federal income tax purposes. |
Notes and Loan Payable and Amou
Notes and Loan Payable and Amounts Due Under Repurchase Agreements | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Notes and Loan Payable and Amounts Due Under Repurchase Agreements | Notes and Loan Payable and Amounts Due Under Repurchase Agreements Notes payable includes the following: December 31, 2018 2017 (Dollars in thousands) Senior notes due 2027 Principal $ 500,000 $ 500,000 Unamortized debt issue costs (5,102 ) (5,572 ) Unamortized discount (307 ) (335 ) $ 494,591 $ 494,093 On June 16, 2017, we issued $500 million aggregate principal amount of senior unsecured notes due 2027 which bear interest at 5.0% per year and will mature on June 15, 2027 (the “2027 Notes”). The 2027 Notes were issued at a $0.3 million discount, which is being amortized over the term of the 2027 Notes using the effective interest method. Contractual interest is payable semi-annually in arrears each June 15th and December 15th. The initial transaction fees and costs totaling $5.8 million were capitalized as deferred financing costs and are being amortized over the term of the 2027 Notes using the effective interest method. We used the net proceeds from the issuance of the 2027 Notes to prepay our $100 million term loan (the "Term Loan") that was scheduled to mature in 2019 on June 16, 2017, and to redeem our $400 million notes that were scheduled to mature in 2021 (the "2021 Notes") on July 17, 2017. We paid $413.3 million to redeem the 2021 Notes which included a redemption premium equal to 3.313% of the $400 million principal amount of the 2021 Notes. We incurred a loss of $18.4 million in 2017 on the redemption of the 2021 Notes. On September 30, 2016, we entered into a credit agreement with six banks that provided for a $150 million unsecured revolving line of credit (the "Revolving Facility") that terminates on September 30, 2021 and a $100 million term loan that was scheduled to terminate on September 30, 2019 but was repaid on June 16, 2017 without penalty. We utilized the proceeds from the Term Loan to make a contribution to the capital and surplus of our subsidiary, American Equity Life. Any proceeds from the Revolving Facility will be used to finance our general corporate purposes. Interest was payable quarterly on the Term Loan. The interest rate for all borrowings under the credit agreement is floating at a rate based on our election that will be equal to the alternate base rate (as defined in the credit agreement) plus the applicable margin or the adjusted LIBOR rate (as defined in the credit agreement) plus the applicable margin. We also pay a commitment fee based on the available unused portion of the Revolving Facility. The applicable margin and commitment fee rate are based on our credit rating and can change throughout the period of the borrowings. Based upon our current credit rating, the applicable margin is 0.75% for alternate base rate borrowings and 1.75% for adjusted LIBOR rate borrowings, and the commitment fee is 0.275% . The interest rate in effect on the Term Loan was 3.125% in 2017. Under this agreement, we are required to maintain a minimum risk-based capital ratio at our subsidiary, American Equity Life, of 275% , a maximum ratio of adjusted debt to total adjusted capital of 0.35 , and a minimum level of statutory surplus at American Equity Life equal to the sum of 1) 80% of statutory surplus at June 30, 2016, 2) 50% of the statutory net income for each fiscal quarter ending after June 30, 2016, and 3) 50% of all capital contributed to American Equity Life after June 30, 2016. The Revolving Facility contains an accordion feature that allows us, on up to three occasions and subject to credit availability, to increase the credit facility by an additional $50 million in the aggregate. We also have the ability to extend the maturity date of the Revolving Facility by an additional one year past the initial maturity date of September 30, 2021 with the consent of the extending banks. There are currently no guarantors of the Revolving Facility, but certain of our subsidiaries must guarantee our obligations under the credit agreement if such subsidiaries guarantee other material amounts of our debt. No amounts were outstanding under the Revolving Facility at December 31, 2018 and 2017 . As of December 31, 2018 , $838.6 million is unrestricted and could be distributed to shareholders and still be in compliance with all covenants under this credit agreement. As part of our investment strategy, we enter into securities repurchase agreements (short-term collateralized borrowings). The maximum amount borrowed during 2018 , 2017 and 2016 was $544.1 million , $274.5 million and $113.0 million , respectively. When we do borrow cash on these repurchase agreements, we pledge collateral in the form of debt securities with fair values approximately equal to the amount due and we use the cash to purchase debt securities ahead of the time we collect the cash from selling annuity policies to avoid a lag between the investment of funds and the obligation to credit interest to policyholders. We earn investment income on the securities purchased with these borrowings at a rate in excess of the cost of these borrowings. Such borrowings averaged $51.8 million , $40.0 million and $4.5 million for the years ended December 31, 2018 , 2017 and 2016 , respectively. The weighted average interest rate on amounts due under repurchase agreements was 1.90% , 0.84% and 0.66% for the years ended December 31, 2018 , 2017 and 2016 , respectively. |
Subordinated Debentures
Subordinated Debentures | 12 Months Ended |
Dec. 31, 2018 | |
Subordinated Borrowings [Abstract] | |
Subordinated Debentures | Subordinated Debentures Our wholly-owned subsidiary trusts (which are not consolidated) have issued fixed rate and floating rate trust preferred securities and have used the proceeds from these offerings to purchase subordinated debentures from us. We also issued subordinated debentures to the trusts in exchange for all of the common securities of each trust. The sole assets of the trusts are the subordinated debentures and any interest accrued thereon. The interest payment dates on the subordinated debentures correspond to the distribution dates on the trust preferred securities issued by the trusts. The trust preferred securities mature simultaneously with the subordinated debentures. Our obligations under the subordinated debentures and related agreements provide a full and unconditional guarantee of payments due under the trust preferred securities. All subordinated debentures are callable by us at any time, except for the Trust II subordinated debt obligations. Following is a summary of subordinated debt obligations to the trusts at December 31, 2018 and 2017 : December 31, 2018 2017 Interest Rate Due Date (Dollars in thousands) American Equity Capital Trust II $ 77,551 $ 77,298 5% June 1, 2047 American Equity Capital Trust III 27,840 27,840 *LIBOR + 3.90% April 29, 2034 American Equity Capital Trust IV 12,372 12,372 *LIBOR + 4.00% January 8, 2034 American Equity Capital Trust VII 10,830 10,830 *LIBOR + 3.75% December 14, 2034 American Equity Capital Trust VIII 20,620 20,620 *LIBOR + 3.75% December 15, 2034 American Equity Capital Trust IX 15,470 15,470 *LIBOR + 3.65% June 15, 2035 American Equity Capital Trust X 20,620 20,620 *LIBOR + 3.65% September 15, 2035 American Equity Capital Trust XI 20,620 20,620 *LIBOR + 3.65% December 15, 2035 American Equity Capital Trust XII 41,238 41,238 *LIBOR + 3.50% April 7, 2036 247,161 246,908 Unamortized debt issue costs (4,179 ) (4,343 ) $ 242,982 $ 242,565 *—three month London Interbank Offered Rate The principal amount of the subordinated debentures issued by us to American Equity Capital Trust II ("Trust II") is $100.0 million . These debentures were assigned a fair value of $74.7 million at the date of issue (based upon an effective yield-to-maturity of 6.8% ). The difference between the fair value at the date of issue and the principal amount is being accreted over the life of the debentures. The trust preferred securities issued by Trust II were issued to Iowa Farm Bureau Federation, which owns more than 50% of the voting capital stock of FBL Financial Group, Inc. ("FBL"). The consideration received by Trust II in connection with the issuance of its trust preferred securities consisted of fixed income securities of equal value which were issued by FBL. |
Retirement and Share-based Comp
Retirement and Share-based Compensation Plans | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Retirement and Share-based Compensation Plans | Retirement and Share-based Compensation Plans We have adopted a contributory defined contribution plan which is qualified under Section 401(k) of the Internal Revenue Code. The plan covers substantially all of our full-time employees subject to minimum eligibility requirements. Employees can contribute a percentage of their annual salary (up to a maximum annual contribution of $18,500 in 2018 , $18,000 in 2017 and 2016 ) to the plan. We contribute an additional amount, subject to limitations, based on the voluntary contribution of the employee. Further, the plan provides for additional employer contributions based on the discretion of the Board of Directors. Plan contributions charged to expense were $1.7 million , $1.4 million and $1.3 million for the years ended December 31, 2018 , 2017 and 2016 , respectively. The following table summarizes compensation expense recognized for employees and directors as a result of share-based compensation: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) ESOP $ 2,194 $ 1,474 $ 2,522 Employee Incentive Plans 5,434 2,155 1,207 Director Equity Plans 966 812 685 $ 8,594 $ 4,441 $ 4,414 The principal purpose of the American Equity Investment Employee Stock Ownership Plan ("ESOP") is to provide each eligible employee with an equity interest in us. Employees become eligible once they have completed a minimum of six months of service. Employees become 100% vested after two years of service. Our contribution to the ESOP is determined by the Board of Directors. In 2016, we adopted the 2016 Employee Incentive Plan which authorized the issuance of up to 2,500,000 shares of our Common stock in the form of grants of options, stock appreciation rights, restricted stock awards and restricted stock units. At December 31, 2018 , we had 1,967,395 shares of common stock available for future grant under the 2016 Employee Incentive Plan. The 2009 Employee Incentive Plan, which expired in June 2014, authorized the issuance of up to 2,500,000 shares of our common stock in the form of grants of options, stock appreciation rights, restricted stock awards and restricted stock units. All options granted under this plan had six or ten year terms and a three year vesting period after which they become fully exercisable immediately. We have a long-term performance incentive plan under which certain members of our senior management team are granted restricted stock units pursuant to the 2016 Employee Incentive Plan. During 2018 , 2017 and 2016 , we granted 105,617 , 84,476 and 208,565 restricted stock units under this plan, respectively. For the 2018 and 2017 grant, vesting is tied to threshold, target and maximum performance goals for the three year periods ending December 31, 2020 and December 31, 2019 , respectively. Fifty percent of the restricted stock units will vest if we meet threshold goals, 100% of the restricted stock units will vest if we meet target performance goals and 150% of the restricted stock units will vest if we meet maximum performance goals. For the 2016 grant, vesting is tied to threshold and target performance goals for the three year period ending December 31, 2018 . Fifty percent of the restricted stock units will vest if we meet threshold goals and 100% of the restricted stock units will vest if we meet target performance goals. Compensation expense is recognized over the three year vesting period based on the likelihood of meeting threshold, target and maximum goals. Restricted stock units that ultimately vest are payable in an equal number of shares of our common stock. Restricted stock units are accounted for as equity awards and the estimated fair value of restricted stock units is based upon the closing price of our common stock on the date of grant. During 2018 , 2017 and 2016 , we issued 36,270 , 39,826 and 43,373 , respectively, shares of restricted common stock under the 2016 Employee Incentive Plan to certain employees. These shares will generally vest on the date three years following the grant date provided the participant remains employed with us. The 2017 grant included 6,727 shares that vested on the date one year following the grant date provided the participant remained employed with us. Compensation expense is recognized over the one year or three year vesting period. Shares vest immediately for participants over 65 years of age with 10 years of service with us, and compensation expense under this plan for these participants was recognized upon approval of the incentive award by the compensation committee. During 2016, the shares of restricted stock granted during 2015 were canceled due to an administrative issue related to the grant, which was made under an expired equity plan. During 2016, we issued 21,806 shares of common stock to the employees impacted by the cancellation taking into consideration the canceled 2015 grants. During 2018, we granted 85,500 time-based restricted stock units under the 2016 Employee Incentive Plan to certain employees. These restricted stock units will generally vest on the date one year following the grant date provided the participant remains employed with us. The 2018 grant includes 6,000 restricted stock units that will vest on the date three years following the grant date provided the participant remains employed with us. Compensation expense is recognized over the one year or three year vesting period. Restricted stock units that ultimately vest are payable in an equal number of shares of our common stock. Restricted stock units are accounted for as equity awards and the estimated fair value of restricted stock units is based upon the closing price of our common stock on the date of grant. The 2013 Director Equity and Incentive Plan authorizes the grant of options, stock appreciation rights, restricted stock awards and restricted stock units convertible into or based upon our common stock of up to 250,000 shares to our Directors. During 2018 , 2017 and 2016 , we issued 28,600 , 33,000 and 47,500 shares of common stock, respectively, all of which are restricted stock, and which vest the earlier of the next annual meeting date or one year from the grant date provided the individual remains a Director during that time period. At December 31, 2018 , we had 54,900 shares of common stock available for future grant under the 2013 Director and Equity Incentive Plan. During 2014, we established the 2014 Independent Insurance Agent Restricted Stock and Restricted Stock Unit Plan, which was amended during 2016. Under the amended plan, agents of American Equity Life may receive grants of restricted stock and restricted stock units based upon their individual sales. The plan authorizes grants of up to 1,800,000 shares of our common stock. At December 31, 2018 , we had 667,626 shares of common stock available for future grant under the amended 2014 Independent Insurance Agent Restricted Stock and Restricted Stock Unit Plan. We recognize commission expense and an increase to additional paid-in capital as share-based compensation equal to the fair value of the restricted stock and restricted stock units as they are earned. In January 2017, American Equity Life's agents were granted 363,624 restricted stock units based on their production during 2016, and we recorded commission expense (capitalized as deferred policy acquisition costs) of $2.6 million in 2016. In January 2018, agents vested in 138,820 restricted stock units granted in January 2017 based on their continued service as an independent agent and their 2017 individual sales of our products, and for which we recorded commission expense (capitalized as deferred policy acquisition costs) of $1.3 million in 2017. In January 2019, agents vested in 57,562 restricted stock units granted in January 2017 based on their continued service as an independent agent and their 2018 individual sales of our products, and for which we recorded commission expense (capitalized as deferred policy acquisition costs) of $1.6 million in 2018. In January 2016, American Equity Life's agents were granted 650,683 restricted stock units based on their production during 2015. In January 2017, agents vested in 246,532 restricted stock units granted in January 2016 based on their continued service as an independent agent and their 2016 individual sales of our products, and for which we recorded commission expense (capitalized as deferred policy acquisition costs) of $1.7 million in 2016. In January 2018, agents vested in 100,586 restricted stock units granted in January 2016 based on their continued service as an independent agent and their 2017 individual sales of our products, and for which we recorded commission expense (capitalized as deferred policy acquisition costs) of $2.2 million in 2017. In January 2019, agents vested in 89,367 restricted stock units granted in January 2016 based on their continued service as an independent agent and their 2018 individual sales of our products, and for which we recorded commission expense (capitalized as deferred policy acquisition costs) of $2.4 million in 2018. For the restricted stock units granted to agents in January of 2017 and 2016, 20% of the restricted stock units vested one year from the grant date if the agent was in good standing with American Equity Life at that date. The remaining 80% of the restricted stock units granted to retirement eligible individuals vest over a three year period if the agent remains in good standing with American Equity Life. The remaining 80% of the restricted stock units granted to non-retirement eligible individuals vest based on the agent's individual sales and continued service as an independent agent over a period of time not to exceed five years. In January 2015, American Equity Life's agents were granted 27,985 shares of restricted stock and 221,489 restricted stock units based on their production during 2014. In January 2017, agents vested in 36,609 restricted stock units granted in January 2015 based on their continued service as an independent agent and their 2016 individual sales of our products, and for which we recorded commission expense (capitalized as deferred policy acquisition costs) of $0.6 million in 2016. In January 2018, agents vested in 32,815 restricted stock units granted in January 2015 based on their continued service as an independent agent and their 2017 individual sales of our products, and for which we recorded commission expense (capitalized as deferred policy acquisition costs) of $0.8 million in 2017. In January 2019, agents vested in 28,575 restricted stock units granted in January 2015 based on their continued service as an independent agent and their 2018 individual sales of our products, and for which we recorded commission expense (capitalized as deferred policy acquisition costs) of $0.9 million in 2018. The restricted stock was granted to retirement eligible individuals and vested immediately upon grant. 20% of the restricted stock units vested one year from the grant date if the agent was in good standing with American Equity Life at that date. The remaining 80% of the restricted stock units granted vest based on the agent's individual sales and continued service as an independent agent over a period of time not to exceed five years. Our 1996 Stock Option Plan, 2000 Employee Stock Option Plan, 2000 Directors Stock Option Plan and 2011 Director Stock Option Plan authorized grants of options to officers, directors and employees for an aggregate of up to 3,475,000 shares of our common stock. All options granted under these plans have ten year terms and a six month or three year vesting period after which they become fully exercisable immediately. At December 31, 2018 , we had 18,000 shares of common stock available for future grant under the 2011 Director Stock Option Plan. During 2007, 2010 and 2012 we established Independent Insurance Agent Stock Option plans. Under these plans, agents of American Equity Life received grants of options to acquire shares of our common stock based upon their individual sales. The plans authorize grants of options to agents for an aggregate of up to 8,000,000 shares of our common stock. We recognize commission expense and an increase to additional paid-in capital as share-based compensation equal to the fair value of the options as they are earned. Changes in the number of stock options granted to employees and agents outstanding during the years ended December 31, 2018 , 2017 and 2016 are as follows: Number of Shares Weighted-Average Exercise Price per Share Total Exercise Price (Dollars in thousands, except per share data) Outstanding at January 1, 2016 3,443,991 $ 15.17 $ 52,240 Granted — — — Canceled (24,700 ) 14.83 (366 ) Exercised (500,345 ) 9.97 (4,989 ) Outstanding at December 31, 2016 2,918,946 16.06 46,885 Granted — — — Canceled (57,200 ) 13.66 (781 ) Exercised (881,481 ) 15.90 (14,020 ) Outstanding at December 31, 2017 1,980,265 16.20 32,084 Granted — — — Canceled (40,850 ) 18.87 (771 ) Exercised (717,550 ) 13.99 (10,040 ) Outstanding at December 31, 2018 1,221,865 17.41 $ 21,273 The following table summarizes information about stock options outstanding at December 31, 2018 : Stock Options Outstanding and Vested Range of Exercise Prices Number of Awards Remaining Life (yrs) Weighted-Average Exercise Price Per Share $5.07 - $8.02 122,500 0.36 $ 6.77 $9.27 - $11.35 252,515 1.54 9.97 $12.04 - $24.79 846,850 1.84 21.17 $5.07 - $24.79 1,221,865 1.63 17.41 The aggregate intrinsic value for stock options outstanding and vested awards was $12.9 million at December 31, 2018 . For the years ended December 31, 2018 , 2017 and 2016 , the total intrinsic value of options exercised by officers, directors and employees was $3.0 million , $1.5 million and $4.0 million , respectively. Intrinsic value for stock options is calculated as the difference between the exercise price of the underlying awards and the price of our common stock as of the reporting date. Cash received from stock options exercised for the years ended December 31, 2018 , 2017 and 2016 was $10.0 million , $14.0 million and $5.0 million , respectively. We have deferred compensation arrangements with certain officers, directors, and consultants, whereby these individuals agreed to take our common stock at a future date in lieu of cash payments at the time of service. The common stock is to be issued in conjunction with a "trigger event," as that term is defined in the individual agreements. At both December 31, 2018 and 2017 , these individuals have earned, and we have reserved for future issuance, 364,000 shares of common stock, respectively, pursuant to these arrangements. No equity-based deferred compensation arrangements were in effect during 2018 , 2017 or 2016 . We have deferred compensation agreements with certain former officers whereby these individuals have deferred certain salary and bonus compensation which is deposited into the American Equity Officer Rabbi Trust (Officer Rabbi Trust). The amounts deferred for certain former employees are invested in assets at the direction of the former employee. The assets of the Officer Rabbi Trust are included in our assets and a corresponding deferred compensation liability is recorded. The deferred compensation liability is recorded at the fair market value of the assets in the Officer Rabbi Trust with the change in fair value included as a component of compensation expense. The deferred compensation liability related to these agreements was $1.5 million and $2.0 million at December 31, 2018 and 2017 , respectively. The Officer Rabbi Trust held 32,597 shares and 34,539 shares of our common stock at December 31, 2018 and 2017 , respectively, which are treated as treasury shares. |
Statutory Financial Information
Statutory Financial Information and Dividend Restrictions | 12 Months Ended |
Dec. 31, 2018 | |
Insurance [Abstract] | |
Statutory Financial Information and Dividend Restrictions | Statutory Financial Information and Dividend Restrictions Statutory accounting practices prescribed or permitted by regulatory authorities for our life insurance subsidiaries differ from GAAP. Net income for our primary life insurance subsidiary as determined in accordance with statutory accounting practices was as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) American Equity Life $ 210,049 $ 375,900 $ 75,035 Statutory capital and surplus for our primary life insurance subsidiary was as follows: December 31, 2018 2017 (Dollars in thousands) American Equity Life $ 3,251,881 $ 3,005,654 American Equity Life is domiciled in the State of Iowa and is regulated by the Iowa Insurance Division. In some instances, the Iowa Insurance Division has adopted prescribed or permitted statutory accounting practices that differ from the required accounting outlined in National Association of Insurance Commissioners ("NAIC") Statutory Accounting Principles ("SAP"). For the year ended December 31, 2018 , American Equity Life's use of prescribed statutory accounting practices resulted in higher statutory capital and surplus of $232.4 million relative to NAIC SAP due to its accounting for call option derivative instruments and fixed index annuity reserves. For the year ended December 31, 2017 , American Equity Life's use of the same prescribed statutory accounting practice resulted in lower statutory capital and surplus of $109.7 million . We purchase call options to hedge the growth in interest credited on fixed index products. The Iowa Insurance Division allows an insurer to elect (1) to use an amortized cost method to account for such call options and (2) to use a fixed index annuity reserve calculation methodology under which call options associated with the current index interest crediting term are valued at zero. Life insurance companies are subject to the NAIC risk-based capital (RBC) requirements which are intended to be used by insurance regulators as an early warning tool to identify deteriorating or weakly capitalized insurance companies for the purpose of initiating regulatory action. Calculations using the NAIC formula indicated that American Equity Life's ratio of total adjusted capital to the highest level of required capital at which regulatory action might be initiated (Company Action Level) is as follows: December 31, 2018 2017 (Dollars in thousands) Total adjusted capital $ 3,542,339 $ 3,260,328 Company Action Level RBC 983,169 861,419 Ratio of adjusted capital to Company Action Level RBC 360 % 378 % Prior approval of regulatory authorities is required for the payment of dividends to the parent company by American Equity Life which exceed an annual limitation. American Equity Life may pay dividends without prior approval, unless such payments, together with all other such payments within the preceding twelve months, exceed the greater of (1) net gain from operations before net realized capital gains/losses for the preceding calendar year or, (2) 10% of the American Equity Life's surplus at the preceding year-end. The amount of dividends permitted to be paid by American Equity Life to its parent company without prior approval of regulatory authorities is $325.2 million as of December 31, 2018 . No dividends were paid by any of our insurance subsidiaries for any of the years presented in these financial statements. The Parent Company relies on its subsidiaries for cash flow, which has primarily been in the form of investment management fees. Retained earnings in our consolidated financial statements primarily represent undistributed earnings of American Equity Life. As such, our ability to pay dividends is limited by the regulatory restriction placed upon insurance companies as described above. In addition, American Equity Life retains funds to allow for sufficient capital for growth. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies We lease our home office space and certain equipment under various operating leases. Rent expense for the years ended December 31, 2018 , 2017 and 2016 totaled $3.2 million , $2.9 million and $2.8 million , respectively. At December 31, 2018 , the aggregate future minimum lease payments are $13.4 million . The following represents payments due by period for operating lease obligations as of December 31, 2018 (dollars in thousands): Year Ending December 31: 2019 $ 1,986 2020 2,037 2021 1,841 2022 1,680 2023 1,481 2024 and thereafter 4,364 We are occasionally involved in litigation, both as a defendant and as a plaintiff. In addition, state regulatory bodies, such as state insurance departments, the SEC, FINRA, the DOL, and other regulatory bodies regularly make inquiries and conduct examinations or investigations concerning our compliance with, among other things, insurance laws, securities laws, the Employee Retirement Income Security Act of 1974, as amended, and laws governing the activities of broker/dealers. In accordance with applicable accounting guidelines, we establish an accrued liability for litigation and regulatory matters when those matters present loss contingencies that are both probable and estimable. As a litigation or regulatory matter is developing we, in conjunction with outside counsel, evaluate on an ongoing basis whether the matter presents a loss contingency that meets conditions indicating the need for accrual and/or disclosure, and if not the matter will continue to be monitored for further developments. If and when the loss contingency related to litigation or regulatory matters is deemed to be both probable and estimable, we will establish an accrued liability with respect to that matter and will continue to monitor the matter for further developments that may affect the amount of the accrued liability. There can be no assurance that any pending or future litigation will not have a material adverse effect on our business, financial condition, or results of operations. In addition to our commitments to fund mortgage loans, we have unfunded commitments at December 31, 2018 to limited partnerships of $56.0 million and to privately placed corporate securities of $109.7 million . |
Earnings Per Share and Stockhol
Earnings Per Share and Stockholders' Equity | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share and Stockholders' Equity | Earnings Per Share and Stockholders' Equity Earnings Per Share The following table sets forth the computation of earnings per common share and earnings per common share - assuming dilution: Year Ended December 31, 2018 2017 2016 (Dollars in thousands, except per share data) Numerator: Net income - numerator for earnings per common share $ 458,016 $ 174,645 $ 83,243 Denominator : Weighted average common shares outstanding 90,347,915 88,982,442 84,793,151 Effect of dilutive securities: Warrants — — 15,136 Stock options and deferred compensation agreements 709,433 945,612 456,236 Restricted stock and restricted stock units 365,237 382,954 340,646 Denominator for earnings per common share - assuming dilution 91,422,585 90,311,008 85,605,169 Earnings per common share $ 5.07 $ 1.96 $ 0.98 Earnings per common share - assuming dilution $ 5.01 $ 1.93 $ 0.97 Options to purchase shares of our common stock that were outstanding during the respective periods indicated but were not included in the computation of diluted earnings per share because the options' exercise price was greater than the average market price of the common shares are as follows: Period Number of Shares Range of Exercise Prices Minimum Maximum Year ended December 31, 2018 — $— $— Year ended December 31, 2017 — $— $— Year ended December 31, 2016 1,054,091 $24.79 $24.79 Stockholders' Equity In August 2015, we completed an underwritten public offering of 8,600,000 shares of our common stock at a public offering price of $25.25 per share, of which 4,300,000 shares were subject to a forward sale agreement. The underwriters exercised in full their option to purchase 1,290,000 additional shares of common stock, which were subject to a separate forward sale agreement. We settled the forward sale agreements on August 1, 2016 and issued 5,590,000 shares of our common stock and received $134.7 million in net proceeds. We contributed the net proceeds from the settlement to the capital and surplus of American Equity Life. The forward sale agreements had no initial fair value since they were entered into at the then market price of the common stock. The forward sale agreements were equity instruments and qualified for an exception from derivative and fair value accounting. |
Quarterly Financial Information
Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information (Unaudited) | Quarterly Financial Information (Unaudited) Unaudited quarterly results of operations are summarized below. Quarter Ended March 31, June 30, September 30, December 31, (Dollars in thousands, except per share data) 2018 Premiums and product charges $ 59,776 $ 60,763 $ 65,605 $ 64,824 Net investment income 510,784 533,282 549,391 554,355 Change in fair value of derivatives (451,083 ) 132,205 595,311 (1,054,281 ) Net realized gains (losses) on investments, excluding OTTI losses 302 (38,381 ) (2,196 ) 3,097 Net OTTI losses recognized in operations (907 ) (2,396 ) (14,373 ) (18,980 ) Total revenues 118,872 685,473 1,193,738 (450,985 ) Net income 140,962 93,903 169,328 53,823 Earnings per common share 1.57 1.04 1.87 0.59 Earnings per common share - assuming dilution 1.55 1.03 1.85 0.59 2017 Premiums and product charges $ 52,974 $ 56,323 $ 60,500 $ 64,925 Net investment income 485,597 493,489 500,202 512,709 Change in fair value of derivatives 386,533 266,820 362,525 661,993 Net realized gains on investments, excluding OTTI losses 2,338 3,873 1,579 2,719 Net OTTI losses recognized in operations (141 ) (949 ) (464 ) (3,076 ) Loss on extinguishment of debt — (428 ) (18,389 ) — Total revenues 927,301 819,128 905,953 1,239,270 Net income 53,939 26,946 56,957 36,803 Earnings per common share 0.61 0.30 0.64 0.41 Earnings per common share - assuming dilution 0.60 0.30 0.63 0.41 Earnings per common share for each quarter is computed independently of earnings per common share for the year. As a result, the sum of the quarterly earnings per common share amounts may not equal the earnings per common share for the year. The differences between the change in fair value of derivatives for each quarter primarily correspond to the performance of the indices upon which our call options are based. The comparability of net income is impacted by the application of fair value accounting to our fixed index annuity business as follows: Quarter Ended March 31, June 30, September 30, December 31, (Dollars in thousands) 2018 $ (61,794 ) $ (23,593 ) $ 427 $ 28,298 2017 7,069 37,075 30,806 3,518 |
Schedule I - Summary of Investm
Schedule I - Summary of Investments - Other Than Investments in Related Parties | 12 Months Ended |
Dec. 31, 2018 | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Abstract] | |
Schedule I - Summary of Investments - Other Than Investments in Related Parties | Schedule I—Summary of Investments— Other Than Investments in Related Parties AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY December 31, 2018 Column A Column B Column C Column D Type of Investment Amortized Cost (1) Fair Value Amount at which shown in the balance sheet (Dollars in thousands) Fixed maturity securities: Available for sale: United States Government full faith and credit $ 11,872 $ 11,652 $ 11,652 United States Government sponsored agencies 1,208,468 1,138,529 1,138,529 United States municipalities, states and territories 3,880,703 4,126,267 4,126,267 Foreign government obligations 226,860 230,274 230,274 Corporate securities 28,483,138 28,371,514 28,371,514 Residential mortgage backed securities 1,134,623 1,202,159 1,202,159 Commercial mortgage backed securities 5,492,271 5,379,003 5,379,003 Other asset backed securities 5,693,255 5,464,329 5,464,329 Total fixed maturity securities 46,131,190 45,923,727 45,923,727 Mortgage loans on real estate 2,943,091 2,920,612 2,943,091 Derivative instruments 441,616 205,149 205,149 Other investments 355,531 355,531 Total investments $ 49,871,428 $ 49,427,498 (1) On the basis of cost adjusted for other than temporary impairments, repayments and amortization of premiums and accrual of discounts for fixed maturity securities and short-term investments, original cost for derivative instruments and unpaid principal balance less allowance for credit losses for mortgage loans. See accompanying Report of Independent Registered Public Accounting Firm. |
Schedule II - Condensed Financi
Schedule II - Condensed Financial Information of Registrant | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule II - Condensed Financial Information of Registrant | December 31, 2018 2017 Assets Cash and cash equivalents $ 68,876 $ 22,486 Equity securities of subsidiary trusts 7,437 7,429 Receivable from subsidiaries 1,170 166 Deferred income taxes 7,905 7,945 Federal income tax recoverable, including amount from subsidiaries — 1,059 Other assets 2,751 1,566 88,139 40,651 Investment in and advances to subsidiaries 3,066,039 3,550,405 Total assets $ 3,154,178 $ 3,591,056 Liabilities and Stockholders' Equity Liabilities: Notes and loan payable $ 494,591 $ 494,093 Subordinated debentures payable to subsidiary trusts 242,982 242,565 Federal income tax payable 8,892 — Other liabilities 8,612 4,241 Total liabilities 755,077 740,899 Stockholders' equity: Common stock 90,369 89,331 Additional paid-in capital 811,186 791,446 Accumulated other comprehensive income (loss) (52,432 ) 724,599 Retained earnings 1,549,978 1,244,781 Total stockholders' equity 2,399,101 2,850,157 Total liabilities and stockholders' equity $ 3,154,178 $ 3,591,056 See accompanying note to condensed financial statements. See accompanying Report of Independent Registered Public Accounting Firm. Year Ended December 31, 2018 2017 2016 Revenues: Net investment income $ 773 $ 492 $ 78 Dividends from subsidiary trusts 461 410 384 Dividends from dissolved subsidiaries 10,393 — — Investment advisory fees 92,335 83,941 75,706 Surplus note interest from subsidiary 4,080 4,080 4,080 Change in fair value of derivatives 1,051 (412 ) (810 ) Loss on extinguishment of debt — (18,817 ) — Total revenues 109,093 69,694 79,438 Expenses: Interest expense on notes and loan payable 25,498 30,368 28,248 Interest expense on subordinated debentures issued to subsidiary trusts 15,491 14,124 12,958 Other operating costs and expenses 18,579 9,234 8,551 Total expenses 59,568 53,726 49,757 Income before income taxes and equity in undistributed income of subsidiaries 49,525 15,968 29,681 Income tax expense 2,603 6,895 12,073 Income before equity in undistributed income of subsidiaries 46,922 9,073 17,608 Equity in undistributed income of subsidiaries 411,094 165,572 65,635 Net income $ 458,016 $ 174,645 $ 83,243 See accompanying note to condensed financial statements. See accompanying Report of Independent Registered Public Accounting Firm. Year Ended December 31, 2018 2017 2016 Operating activities Net income $ 458,016 $ 174,645 $ 83,243 Adjustments to reconcile net income to net cash provided by operating activities: Provision for depreciation and amortization 916 1,610 1,946 Accrual of discount on equity security (8 ) (7 ) (7 ) Equity in undistributed income of subsidiaries (411,094 ) (165,572 ) (65,635 ) Change in fair value of derivatives (1,325 ) (657 ) (698 ) Loss on extinguishment of debt — 18,817 — Accrual of discount on debenture issued to subsidiary trust 254 236 221 Share-based compensation 1,626 951 818 Deferred income taxes 40 1,583 2,117 Changes in operating assets and liabilities: Receivable from subsidiaries (1,004 ) 16 (125 ) Federal income tax recoverable/payable 9,951 (4,673 ) 11,361 Other assets (229 ) 158 (326 ) Other liabilities 4,860 (12,427 ) 2,546 Net cash provided by operating activities 62,003 14,680 35,461 Investing activities Capital contributions to subsidiaries $ — $ — $ (255,000 ) Purchases of property, plant and equipment (29 ) (45 ) (54 ) Net cash used in investing activities (29 ) (45 ) (255,054 ) Financing activities Financing fees incurred and deferred $ — $ (5,817 ) $ (1,456 ) Repayment of notes payable — (413,252 ) — Repayment of loan payable — (100,000 ) — Proceeds from issuance of notes payable — 499,650 — Proceeds from issuance of loan payable — — 100,000 Proceeds from issuance of common stock 9,681 14,028 139,654 Dividends paid (25,265 ) (23,152 ) (21,114 ) Net cash provided by (used in) financing activities (15,584 ) (28,543 ) 217,084 Increase (decrease) in cash and cash equivalents 46,390 (13,908 ) (2,509 ) Cash and cash equivalents at beginning of year 22,486 36,394 38,903 Cash and cash equivalents at end of year $ 68,876 $ 22,486 $ 36,394 Supplemental disclosures of cash flow information Cash paid during the year for: Interest on notes and loan payable $ 25,000 $ 40,537 $ 27,164 Interest on subordinated debentures 13,593 14,573 12,454 Non-cash financing activity: Common stock issued to settle warrants that have expired — — 93 See accompanying note to condensed financial statements. See accompanying Report of Independent Registered Public Accounting Firm. 1. Basis of Presentation The accompanying condensed financial statements should be read in conjunction with the consolidated financial statements and notes thereto of American Equity Investment Life Holding Company (Parent Company). In the Parent Company financial statements, its investment in and advances to subsidiaries are stated at cost plus equity in undistributed income (losses) of subsidiaries since the date of acquisition and net unrealized gains/losses on the subsidiaries' fixed maturity securities classified as "available for sale" and equity securities. See Notes 9 and 10 to our audited consolidated financial statements in this Form 10-K for a description of the Parent Company's notes payable and subordinated debentures payable to subsidiary trusts. |
Schedule III - Supplementary In
Schedule III - Supplementary Insurance Information | 12 Months Ended |
Dec. 31, 2018 | |
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Abstract] | |
Schedule III - Supplementary Insurance Information | Schedule III—Supplementary Insurance Information AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY Column A Column B Column C Column D Column E Deferred policy acquisition costs Future policy benefits, losses, claims and loss expenses Unearned premiums Other policy claims and benefits payable (Dollars in thousands) As of December 31, 2018: Life insurance $ 3,535,838 $ 57,606,009 $ — $ 270,858 As of December 31, 2017: $ 2,714,523 $ 56,142,673 $ — $ 282,884 As of December 31, 2016: $ 2,905,377 $ 51,637,026 $ — $ 298,347 Column A Column F Column G Column H Column I Column J Premium revenue Net investment income Benefits, claims, losses and settlement expenses Amortization of deferred policy acquisition costs Other operating expenses (Dollars in thousands) For the year ended December 31, 2018: Life insurance $ 250,968 $ 2,147,812 $ 483,075 $ 327,991 $ 170,290 For the year ended December 31, 2017: $ 234,722 $ 1,991,997 $ 3,163,234 $ 255,964 $ 156,183 For the year ended December 31, 2016: $ 217,346 $ 1,849,872 $ 1,572,586 $ 374,012 $ 143,437 See accompanying Report of Independent Registered Public Accounting Firm. |
Schedule IV - Reinsurance
Schedule IV - Reinsurance | 12 Months Ended |
Dec. 31, 2018 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | |
Schedule IV - Reinsurance | Schedule IV—Reinsurance AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY Column A Column B Column C Column D Column E Column F Gross amount Ceded to other companies Assumed from other companies Net amount Percent of amount assumed to net (Dollars in thousands) Year ended December 31, 2018 Life insurance in force, at end of year $ 64,544 $ 7,832 $ 53,658 $ 110,370 48.62 % Insurance premiums and other considerations: Annuity product charges $ 231,562 $ 7,074 $ — $ 224,488 — Traditional life, accident and health insurance, and life contingent immediate annuity premiums 26,319 189 350 26,480 1.32 % $ 257,881 $ 7,263 $ 350 $ 250,968 0.14 % Year ended December 31, 2017 Life insurance in force, at end of year $ 1,942,129 $ 9,378 $ 57,965 $ 1,990,716 2.91 % Insurance premiums and other considerations: Annuity product charges $ 206,952 $ 6,458 $ — $ 200,494 — Traditional life, accident and health insurance, and life contingent immediate annuity premiums 33,938 215 505 34,228 1.48 % $ 240,890 $ 6,673 $ 505 $ 234,722 0.22 % Year ended December 31, 2016 Life insurance in force, at end of year $ 1,996,446 $ 10,045 $ 57,849 $ 2,044,250 2.83 % Insurance premiums and other considerations: Annuity product charges $ 178,945 $ 5,366 $ — $ 173,579 — Traditional life, accident and health insurance, and life contingent immediate annuity premiums 43,521 251 497 43,767 1.14 % $ 222,466 $ 5,617 $ 497 $ 217,346 0.23 % See accompanying Report of Independent Registered Public Accounting Firm. |
Schedule V - Valuation and Qual
Schedule V - Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2018 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule V - Valuation and Qualifying Accounts | Schedule V—Valuation and Qualifying Accounts AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY Balance January 1, Charged to Costs and Expenses Translation Adjustment Write-offs/ Payments/Other Balance December 31, (Dollars in thousands) Year ended December 31, 2018 Valuation allowance on mortgage loans $ (7,518 ) $ (3,165 ) $ — $ 2,444 $ (8,239 ) Year ended December 31, 2017 Valuation allowance on mortgage loans $ (8,427 ) $ 278 $ — $ 631 $ (7,518 ) Year ended December 31, 2016 Valuation allowance on mortgage loans $ (14,142 ) $ (4,846 ) $ — $ 10,561 $ (8,427 ) See accompanying Report of Independent Registered Public Accounting Firm. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Consolidation and Basis of Presentation, Policy | Consolidation and Basis of Presentation The consolidated financial statements include our accounts and our wholly-owned subsidiaries: American Equity Life, American Equity Life of New York, Eagle Life, AERL, L.C., American Equity Capital, Inc., American Equity Investment Properties, L.C., American Equity Advisors, Inc. and American Equity Investment Service Company. All significant intercompany accounts and transactions have been eliminated. As of December 31, 2018, American Equity Capital, Inc., American Equity Advisors, Inc. and American Equity Investment Service Company have been dissolved. |
Estimates and Assumptions, Policy | Estimates and Assumptions The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates and assumptions are utilized in the calculation of deferred policy acquisition costs, deferred sales inducements, policy benefit reserves, including the liability for lifetime income benefit riders and the valuation of embedded derivatives on index annuity reserves, valuation of derivatives, valuation of investments, other than temporary impairment of investments, allowances for loan losses on mortgage loans and valuation allowances on deferred tax assets. A description of each critical estimate is incorporated within the discussion of the related accounting policies which follow. It is reasonably possible that actual experience could differ from the estimates and assumptions utilized. |
Investments, Policy | Investments Fixed maturity securities (bonds maturing more than one year after issuance) that may be sold prior to maturity are classified as available for sale. Available for sale securities are reported at fair value and unrealized gains and losses, if any, on these securities are included directly in a separate component of stockholders' equity, net of income taxes and certain adjustments for assumed changes in amortization of deferred policy acquisition costs and deferred sales inducements. Fair values, as reported herein, of fixed maturity and equity securities are based on quoted market prices in active markets when available, or for those fixed maturity securities not actively traded, yield data and other factors relating to instruments or securities with similar characteristics are used. See Note 2 for more information on the determination of fair value. Premiums and discounts are amortized/accrued using methods which result in a constant yield over the securities' expected lives. Amortization/accrual of premiums and discounts on residential and commercial mortgage backed securities incorporate prepayment assumptions to estimate the securities' expected lives. Interest income is recognized as earned. Fixed maturity securities that we have the positive intent and ability to hold to maturity are classified as held for investment. Held for investment securities are reported at cost adjusted for amortization of premiums and discounts. Changes in the fair value of these securities, except for declines that are other than temporary, are not reflected in our consolidated financial statements. The carrying amounts of our impaired investments in fixed maturity securities are adjusted for declines in value that are other than temporary. Other than temporary impairment losses are reported as a component of revenues in the consolidated statements of operations, which presents the amount of noncredit impairment losses that is reported in accumulated other comprehensive income (loss). See Note 3 for further discussion of other than temporary impairment losses. Deterioration in credit quality of the companies or assets backing our fixed maturity securities, imbalances in liquidity recurring in the marketplace or declines in real estate values may further affect the fair value of these fixed maturity securities and increase the potential that certain unrealized losses will be recognized as other than temporary impairments in the future. Mortgage loans on real estate are reported at cost, adjusted for amortization of premiums and accrual of discounts. Interest income is recorded when earned; however, interest ceases to accrue for loans on which interest is more than 90 days past due based upon contractual terms and/or when the collection of interest is not considered probable. We evaluate the mortgage loan portfolio for the establishment of a loan loss allowance by specific identification of impaired loans and the measurement of an estimated loss, if any, for each impaired loan identified and an analysis of the mortgage loan portfolio for the need of a general loan allowance for probable losses on all loans. If we determine that the value of any specific mortgage loan is impaired, the carrying amount of the mortgage loan will be reduced to its fair value, based upon the present value of expected future cash flows from the loan discounted at the loan's contractual interest rate, or the fair value of the underlying collateral, less costs to sell. The amount of the general loan allowance, if any, is based upon our evaluation of the probability of collection, historical loss experience, delinquencies, credit concentrations, underwriting standards and national and local economic conditions. The carrying value of impaired loans is reduced by the establishment of an allowance for loan losses, changes to which are recognized as realized gains or losses on investments. Interest income on impaired loans is recorded on a cash basis. Other invested assets include company owned life insurance, equity securities, real estate, limited partnerships accounted for using the equity method and policy loans. Company owned life insurance is recorded at the amount that can be realized under the insurance contract at the end of the reporting period, which is the cash surrender value adjusted for other charges or other amounts due that are probable at settlement. Dividends are recognized when declared. Policy loans are stated at current unpaid principal balances. Real estate owned is reported at cost less accumulated depreciation. Cost is determined at the time ownership is acquired in satisfaction of mortgage loans and is the lower of the carrying value of the mortgage loan or fair value of the real estate less its estimated cost to sell. Buildings and improvements are depreciated using the straight-line method over their estimated useful lives. Impairment losses on real estate owned are recognized when there are indicators of impairment present and the expected future undiscounted cash flows are not sufficient to recover the real estate's carrying value. Any impairment losses are reported as realized losses and are part of net income. Realized gains and losses on sales of investments are determined on the basis of specific identification based on the trade date. We review and analyze all investments on an ongoing basis for changes in market interest rates and credit deterioration. This review process includes analyzing our ability to recover the amortized cost basis of each investment that has a fair value that is materially lower than its amortized cost and requires a high degree of management judgment and involves uncertainty. The evaluation of securities for other than temporary impairments is a quantitative and qualitative process, which is subject to risks and uncertainties. We have a policy and process to identify securities that could potentially have impairments that are other than temporary. This process involves monitoring market events and other items that could impact issuers. The evaluation includes but is not limited to such factors as: • the length of time and the extent to which the fair value has been less than amortized cost or cost; • whether the issuer is current on all payments and all contractual payments have been made as agreed; • the remaining payment terms and the financial condition and near-term prospects of the issuer; • the lack of ability to refinance due to liquidity problems in the credit market; • the fair value of any underlying collateral; • the existence of any credit protection available; • our intent to sell and whether it is more likely than not we would be required to sell prior to recovery for debt securities; • consideration of rating agency actions; and • changes in estimated cash flows of mortgage and asset backed securities. We determine whether other than temporary impairment losses should be recognized for debt securities by assessing all facts and circumstances surrounding each security. Where the decline in fair value of debt securities is attributable to changes in market interest rates or to factors such as market volatility, liquidity and spread widening, and we anticipate recovery of all contractual or expected cash flows, we do not consider these investments to be other than temporarily impaired because we do not intend to sell these investments and it is not more likely than not we will be required to sell these investments before a recovery of amortized cost, which may be maturity. If we intend to sell a debt security or if it is more likely than not that we will be required to sell a debt security before recovery of its amortized cost basis, other than temporary impairment has occurred and the difference between amortized cost and fair value will be recognized as a loss in operations. If we do not intend to sell and it is not more likely than not we will be required to sell the debt security but also do not expect to recover the entire amortized cost basis of the security, an impairment loss would be recognized in operations in the amount of the expected credit loss. We determine the amount of expected credit loss by calculating the present value of the cash flows expected to be collected discounted at each security's acquisition yield based on our consideration of whether the security was of high credit quality at the time of acquisition. The difference between the present value of expected future cash flows and the amortized cost basis of the security is the amount of credit loss recognized in operations. The remaining amount of the other than temporary impairment is recognized in other comprehensive income (loss). The determination of the credit loss component of a mortgage backed security is based on a number of factors. The primary consideration in this evaluation process is the issuer's ability to meet current and future interest and principal payments as contractually stated at time of purchase. Our review of these securities includes an analysis of the cash flow modeling under various default scenarios considering independent third party benchmarks, the seniority of the specific tranche within the structure of the security, the composition of the collateral and the actual default, loss severity and prepayment experience exhibited. With the input of third party assumptions for default projections, loss severity and prepayment expectations, we evaluate the cash flow projections to determine whether the security is performing in accordance with its contractual obligation. We utilize the models from a leading structured product software specialist serving institutional investors. These models incorporate each security's seniority and cash flow structure. In circumstances where the analysis implies a potential for principal loss at some point in the future, we use the "best estimate" cash flow projection discounted at the security's effective yield at acquisition to determine the amount of our potential credit loss associated with this security. The discounted expected future cash flows equates to our expected recovery value. Any shortfall of the expected recovery when compared to the amortized cost of the security will be recorded as the credit loss component of other than temporary impairment. The cash flow modeling is performed on a security-by-security basis and incorporates actual cash flows on the residential mortgage backed securities through the current period, as well as the projection of remaining cash flows using a number of assumptions including default rates, prepayment rates and loss severity rates. The default curves we use are tailored to the Prime or Alt-A residential mortgage backed securities that we own, which assume lower default rates and loss severity for Prime securities versus Alt-A securities. These default curves are scaled higher or lower depending on factors such as current underlying mortgage loan performance, rating agency loss projections, loan to value ratios, geographic diversity, as well as other appropriate considerations. The determination of the credit loss component of a corporate bond is based on the underlying financial performance of the issuer and their ability to meet their contractual obligations. Considerations in our evaluation include, but are not limited to, credit rating changes, financial statement and ratio analysis, changes in management, significant changes in credit spreads, breaches of financial covenants and a review of the economic outlook for the industry and markets in which they trade. In circumstances where an issuer appears unlikely to meet its future obligation, or the security's price decline is deemed other than temporary, an estimate of credit loss is determined. Credit loss is calculated using default probabilities as derived from the credit default swaps markets in conjunction with recovery rates derived from independent third party analysis or a best estimate of credit loss. This credit loss rate is then incorporated into a present value calculation based on an expected principal loss in the future discounted at the yield at the date of purchase and compared to amortized cost to determine the amount of credit loss associated with the security. In addition, for debt securities which we do not intend to sell and it is not more likely than not we will be required to sell, but our intent changes due to changes or events that could not have been reasonably anticipated, an other than temporary impairment charge is recognized. Once an impairment charge has been recorded, we then continue to review the other than temporarily impaired securities for appropriate valuation on an ongoing basis. Unrealized losses may be recognized in future periods through a charge to earnings should we later conclude that the decline in fair value below amortized cost is other than temporary pursuant to our accounting policy described above. The use of different methodologies and assumptions to determine the fair value of investments and the timing and amount of impairments may have a material effect on the amounts presented in our consolidated financial statements. |
Derivative Instruments, Policy | Derivative Instruments Our derivative instruments include call options used to fund fixed index annuity credits and interest rate swap and caps used to manage interest rate risk associated with the floating rate component on certain of our subordinated debentures. All of our derivative instruments are recognized in the balance sheet at fair value and changes in fair value are recognized immediately in operations. See Note 5 for more information on derivative instruments. |
Cash and Cash Equivalents, Policy | Cash and Cash Equivalents We consider all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents. Book Overdrafts Under our cash management system, checks issued but not yet presented to banks frequently result in overdraft balances for accounting purposes and are classified as Other liabilities on our consolidated balance sheets. We report the changes in the amount of the overdraft balance as a financing activity in our consolidated statement of cash flows as Change in checks in excess of cash balance. |
Deferred Policy Acquisition Costs, Policy | Deferred Policy Acquisition Costs and Deferred Sales Inducements To the extent recoverable from future policy revenues and gross profits, certain costs that are incremental or directly related to the successful production of new business are not expensed when incurred but instead are capitalized as deferred policy acquisition costs or deferred sales inducements. Deferred policy acquisition costs and deferred sales inducements are subject to loss recognition testing on a quarterly basis or when an event occurs that may warrant loss recognition. Deferred policy acquisition costs consist primarily of commissions and certain costs of policy issuance. Deferred sales inducements consist of premium and interest bonuses credited to policyholder account balances. For annuity products, these capitalized costs are being amortized in proportion to expected gross profits from investment spreads, including the cost of hedging the fixed indexed annuity obligations, and, to a lesser extent, from product charges net of expected excess payments for lifetime income benefit riders, and mortality and expense margins. Current and future period gross profits/margins for fixed index annuities also include the impact of amounts recorded for the change in fair value of derivatives and the change in fair value of embedded derivatives. That amortization is adjusted retrospectively through an unlocking process when estimates of current or future gross profits/margins (including the impact of net realized gains on investments and net OTTI losses recognized in operations) to be realized from a group of products are revised. Deferred policy acquisition costs and deferred sales inducements are also adjusted for the change in amortization that would have occurred if available for sale fixed maturity securities had been sold at their aggregate fair value at the end of the reporting period and the proceeds reinvested at current yields. The impact of this adjustment is included in accumulated other comprehensive income (loss) within consolidated stockholders' equity, net of applicable taxes. See Note 6 for more information on deferred policy acquisition costs and deferred sales inducements. |
Deferred Sales Inducements, Policy | Deferred Policy Acquisition Costs and Deferred Sales Inducements To the extent recoverable from future policy revenues and gross profits, certain costs that are incremental or directly related to the successful production of new business are not expensed when incurred but instead are capitalized as deferred policy acquisition costs or deferred sales inducements. Deferred policy acquisition costs and deferred sales inducements are subject to loss recognition testing on a quarterly basis or when an event occurs that may warrant loss recognition. Deferred policy acquisition costs consist primarily of commissions and certain costs of policy issuance. Deferred sales inducements consist of premium and interest bonuses credited to policyholder account balances. For annuity products, these capitalized costs are being amortized in proportion to expected gross profits from investment spreads, including the cost of hedging the fixed indexed annuity obligations, and, to a lesser extent, from product charges net of expected excess payments for lifetime income benefit riders, and mortality and expense margins. Current and future period gross profits/margins for fixed index annuities also include the impact of amounts recorded for the change in fair value of derivatives and the change in fair value of embedded derivatives. That amortization is adjusted retrospectively through an unlocking process when estimates of current or future gross profits/margins (including the impact of net realized gains on investments and net OTTI losses recognized in operations) to be realized from a group of products are revised. Deferred policy acquisition costs and deferred sales inducements are also adjusted for the change in amortization that would have occurred if available for sale fixed maturity securities had been sold at their aggregate fair value at the end of the reporting period and the proceeds reinvested at current yields. The impact of this adjustment is included in accumulated other comprehensive income (loss) within consolidated stockholders' equity, net of applicable taxes. See Note 6 for more information on deferred policy acquisition costs and deferred sales inducements. |
Policy Benefit Reserves, Policy | Policy Benefit Reserves Policy benefit reserves for fixed index annuities with returns linked to the performance of a specified market index are equal to the sum of the fair value of the embedded derivatives and the host (or guaranteed) component of the contracts. The host value is established at inception of the contract and accreted over the policy's life at a constant rate of interest. Future policy benefit reserves for fixed index annuities earning a fixed rate of interest and other deferred annuity products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges. For the years ended December 31, 2018 , 2017 and 2016 , interest crediting rates for these products ranged from 1.00% to 3.30% . The liability for lifetime income benefit riders is based on estimates of the present value of benefit payments expected to be paid in excess of projected policy values recognizing the excess over the expected lives of the underlying policies based on the actual and present value of expected assessments including spreads and product charges and fees. The inputs used in the calculation of the liability for lifetime income benefit riders include actual policy values, actual income account values, actual payout factors, actual roll-up rates and our best estimate assumptions for future policy growth, future policy decrements, the ages at which policyholders are expected to elect to begin to receive lifetime income benefit payments, the percentage of policyholders who elect to receive lifetime income benefit payments and the type of income benefit payments selected upon election. See Note 6 for more information on lifetime income benefit rider reserves. Policy benefit reserves are not reduced for amounts ceded under coinsurance agreements which are reported as coinsurance deposits on our consolidated balance sheets. See Note 7 for more information on reinsurance. |
Deferred Income Taxes, Policy | Deferred Income Taxes Deferred income tax assets or liabilities are computed based on the temporary differences between the financial statement and income tax bases of assets and liabilities using the enacted marginal tax rate. The effect on deferred income tax assets and liabilities resulting from a change in the enacted marginal tax rate is recognized in income in the period that includes the enactment date. Deferred income tax expenses or benefits are based on the changes in the asset or liability from period to period. Deferred income tax assets are subject to ongoing evaluation of whether such assets will more likely than not be realized. The realization of deferred income tax assets primarily depends on generating future taxable income during the periods in which temporary differences become deductible. Deferred income tax assets are reduced by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax asset will not be realized. In making such a determination, all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial operations, is considered. The realization of deferred income tax assets related to unrealized losses on available for sale fixed maturity securities is also based upon our intent and ability to hold those securities for a period of time sufficient to allow for a recovery in fair value and not realize the unrealized loss. |
Recognition of Premium Revenues and Costs, Policy | Recognition of Premium Revenues and Costs Revenues for annuity products include surrender and living income benefit rider charges assessed against policyholder account balances during the period. Interest sensitive and index product benefits related to annuity products include interest credited or index credits to policyholder account balances pursuant to accounting by insurance companies for certain long-duration contracts. The change in fair value of the embedded derivatives for fixed index annuities equals the change in the difference between policy benefit reserves for fixed index annuities computed under the derivative accounting standard and the long-duration contracts accounting standard at each balance sheet date. Considerations from immediate annuities and supplemental contract annuities with life contingencies are recognized as revenue when the policy is issued. All insurance-related revenues, including the change in the fair value of derivatives for call options related to the business ceded under coinsurance agreements (see Note 7), benefits, losses and expenses are reported net of reinsurance ceded. |
Other Comprehensive Income (Loss), Policy | Other Comprehensive Income (Loss) Other comprehensive income (loss) includes all changes in stockholders' equity during a period except those resulting from investments by and distributions to stockholders. Other comprehensive income (loss) excludes net realized investment gains (losses) included in net income which merely represents transfers from unrealized to realized gains and losses. |
Adopted and New Accounting Pronouncements, Policy | Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued an accounting standards update ("ASU") related to revenue arising from contracts with customers. This ASU, which replaces most current revenue recognition guidance, including industry specific guidance, prescribes that an entity should recognize revenue to reflect the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We adopted this ASU on January 1, 2018. The adoption of this ASU had no impact on our consolidated financial statements as revenues related to insurance contracts and investment contracts are excluded from its scope. In January 2016, the FASB issued an ASU that, among other aspects of recognition, measurement, presentation and disclosure of financial instruments, primarily requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Additionally, it changed the accounting for financial liabilities measured at fair value under the fair value option and eliminates some disclosures regarding fair value of financial assets and liabilities measured at amortized cost. We adopted this ASU on January 1, 2018. The adoption of this ASU had no impact on our consolidated financial statements. In March 2016, the FASB issued an ASU related to the accounting for share-based payment transactions. The aspects of accounting guidance affected by this ASU are income taxes, classification of awards as either equity or liabilities, and classification on the statement of cash flows. We adopted this ASU on January 1, 2017. The adoption of this ASU resulted in an income tax benefit of $2.8 million and $2.7 million being recognized in operations during the years ended December 31, 2018 and 2017, respectively, due to the requirement under this standard to recognize excess tax benefits related to share-based payment awards in income tax expense. In August 2016, the FASB issued an ASU that clarifies how certain cash receipts and cash payments are to be presented and classified in the statement of cash flows. We adopted this ASU on January 1, 2018. The adoption of this ASU, which resulted in a reclassification of certain cash flows related to equity method investment distributions from investing activities to operating activities within our consolidated statements of cash flows, did not have a material impact on our consolidated financial statements. In February 2018, the FASB issued an ASU that allows a reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 ("Tax Reform"). We adopted this ASU on January 1, 2018. The adoption of this ASU resulted in a reclassification of $128 million between accumulated other comprehensive income (loss) and retained earnings within our consolidated balance sheet. New Accounting Pronouncements In February 2016, the FASB issued an ASU that will require recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This ASU affects accounting and disclosure more dramatically for lessees as accounting for lessors is mainly unchanged. This ASU will be effective for us on January 1, 2019, with early adoption permitted. The primary impact this guidance will have on our consolidated financial statements is recognition of a lease asset and lease liability within our consolidated balance sheet. Based on our lease agreements at December 31, 2018, we would recognize a lease asset and lease liability of approximately $3.7 million . In June 2016, the FASB issued an ASU that significantly changes the impairment model for most financial assets that are measured at amortized cost and certain other instruments from an incurred loss model to an expected loss model that requires these assets be presented at the net amount expected to be collected. In addition, credit losses on available for sale debt securities will be recorded through an allowance account. This ASU will be effective for us on January 1, 2020, with early adoption permitted. While we are still in the process of evaluating the full impact this guidance will have on our consolidated financial statements, we believe the new impairment model will lead to earlier recognition of credit losses for our commercial mortgage loans. In March 2017, the FASB issued an ASU that applies to certain callable debt securities where the amortized cost basis is at a premium to the price repayable by the issuer at the earliest call date. Under this guidance, the premium will be amortized to the first call date. This ASU will be effective for us on January 1, 2019. This guidance is to be adopted on a modified retrospective basis through a cumulative-effective adjustment to retained earnings as of the beginning of the period of adoption. The adoption of this guidance will not have a material impact on our consolidated financial statements. In June 2018, the FASB issued an ASU that expands the scope of Accounting Standards Codification 718, Compensation-Stock Compensation, to include share-based payment transactions for acquiring goods and services to nonemployees and eliminates the existing accounting model for nonemployee share-based payment awards. This ASU will be effective for us on January 1, 2019, with early adoption permitted. While this guidance will lead to an earlier measurement date for our nonemployee restricted stock units that have not vested as of January 1, 2019, it will not impact our consolidated financial statements upon adoption. In August 2018, the FASB issued an ASU that revises certain aspects of the measurement models and disclosure requirements for long duration insurance and investment contracts. The FASB’s objective in issuing this ASU is to improve, simplify, and enhance the accounting for long-duration contracts. The revisions include updating cash flow assumptions in the calculation of the liability for traditional life products, introducing the term ‘market risk benefit’ ("MRB") and requiring all contract features meeting the definition of an MRB to be measured at fair value, simplifying the method used to amortize deferred policy acquisition costs and deferred sales inducements to a constant basis over the expected term of the related contracts rather than based on gross profits and enhancing disclosure requirements. While this ASU is effective for us on January 1, 2021, the transition date (the remeasurement date) is January 1, 2019. Early adoption of this ASU is permitted. We are in process of evaluating the impact this guidance will have on our consolidated financial statements. Income Tax Reform As a result of Tax Reform, the statutory federal corporate tax rate was reduced from 35% to 21% effective January 1, 2018. |
Fair Value of Financial Instruments, Policy | Fair value is the price that would be received to sell an asset or paid to transfer a liability (exit price) in an orderly transaction between market participants at the measurement date. The objective of a fair value measurement is to determine that price for each financial instrument at each measurement date. We meet this objective using various methods of valuation that include market, income and cost approaches. We categorize our financial instruments into three levels of fair value hierarchy based on the priority of inputs used in determining fair value. The hierarchy defines the highest priority inputs (Level 1) as quoted prices in active markets for identical assets or liabilities. The lowest priority inputs (Level 3) are our own assumptions about what a market participant would use in determining fair value such as estimated future cash flows. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, a financial instrument's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument. We categorize financial assets and liabilities recorded at fair value in the consolidated balance sheets as follows: Level 1— Quoted prices are available in active markets for identical financial instruments as of the reporting date. We do not adjust the quoted price for these financial instruments, even in situations where we hold a large position and a sale could reasonably impact the quoted price. Level 2— Quoted prices in active markets for similar financial instruments, quoted prices for identical or similar financial instruments in markets that are not active; and models and other valuation methodologies using inputs other than quoted prices that are observable. Level 3— Models and other valuation methodologies using significant inputs that are unobservable for financial instruments and include situations where there is little, if any, market activity for the financial instrument. The inputs into the determination of fair value require significant management judgment or estimation. Financial instruments that are included in Level 3 are securities for which no market activity or data exists and for which we used discounted expected future cash flows with our own assumptions about what a market participant would use in determining fair value. Transfers of securities among the levels occur at times and depend on the type of inputs used to determine fair value of each security. |
Mortgage Loans on Real Estate, Allowance for Loan Losses, Policy | We evaluate our mortgage loan portfolio for the establishment of a loan loss allowance by specific identification of impaired loans and the measurement of an estimated loss for each individual loan identified. A mortgage loan is impaired when it is probable that we will be unable to collect all amounts due according to the contractual terms of the loan agreement. If we determine that the value of any specific mortgage loan is impaired, the carrying amount of the mortgage loan will be reduced to its fair value, based upon the present value of expected future cash flows from the loan discounted at the loan's effective interest rate, or the fair value of the underlying collateral less estimated costs to sell. In addition, we analyze the mortgage loan portfolio for the need of a general loan allowance for probable losses on all other loans on a quantitative and qualitative basis. The amount of the general loan allowance is based upon management's evaluation of the collectability of the loan portfolio, historical loss experience, delinquencies, credit concentrations, underwriting standards and national and local economic conditions. We rate each of the mortgage loans in our portfolio based on factors such as historical operating performance, loan to value ratio and economic outlook, among others. We calculate a loss factor to apply to each rating based on historical losses we have recognized in our mortgage loan portfolio. We apply the loss factors to the total principal outstanding within each rating category to determine an appropriate estimate of the general loan loss allowance. We also assess the portfolio qualitatively and apply a loss rate to all loans without a specific allowance based on management's assessment of economic conditions, and we apply an additional amount of loss allowance to a group of loans that we have identified as having higher risk of loss. |
Mortgage Loans on Real Estate, Real Estate Acquired Through Foreclosure, Policy | Charge-offs include allowances that have been established on loans that were satisfied either by taking ownership of the collateral or by some other means such as discounted pay-off or loan sale. When ownership of the property is taken it is recorded at the lower of the mortgage loan's carrying value or the property's fair value (based on appraised values) less estimated costs to sell. The real estate owned is recorded as a component of Other investments and the mortgage loan is recorded as fully paid, with any allowance for credit loss that has been established charged off. Fair value of the real estate is determined by third party appraisal. Recoveries are situations where we have received a payment from the borrower in an amount greater than the carrying value of the loan (principal outstanding less specific allowance). |
Mortgage Loans on Real Estate, Non-Accrual Loan Status, Policy | The loans that are categorized as "in workout" consist of loans that we have agreed to lower or no mortgage payments for a period of time while the borrowers address cash flow and/or operational issues. The key features of these workouts have been determined on a loan-by-loan basis. Most of these loans are in a period of low cash flow due to tenants vacating their space or tenants requesting rent relief during difficult economic periods. Generally, we have allowed the borrower a six month interest only period and in some cases a twelve month period of interest only. Interest only workout loans are expected to return to their regular debt service payments after the interest only period. Interest only loans that are not fully amortizing will have a larger balance at their balloon date than originally contracted. Fully amortizing loans that are in interest only periods will have larger debt service payments for their remaining term due to lost principal payments during the interest only period. In limited circumstances we have allowed borrowers to pay the principal portion of their loan payment into an escrow account that can be used for capital and tenant improvements for a period of not more than twelve months. In these situations new loan amortization schedules are calculated based on the principal not collected during this twelve month workout period and larger payments are collected for the remaining term of each loan. In all cases, the original interest rate and maturity date have not been modified, and we have not forgiven any principal amounts. Mortgage loans are considered delinquent when they become 60 days or more past due. In general, when loans become 90 days past due, become collateral dependent or enter a period with no debt service payments required we place them on non-accrual status and discontinue recognizing interest income. If payments are received on a delinquent loan, interest income is recognized to the extent it would have been recognized if normal principal and interest would have been received timely. If the payments are received to bring a delinquent loan back to current we will resume accruing interest income on that loan. |
Mortgage Loans on Real Estate, Troubled Debt Restructuring, Policy | A Troubled Debt Restructuring ("TDR") is a situation where we have granted a concession to a borrower for economic or legal reasons related to the borrower's financial difficulties that we would not otherwise consider. A mortgage loan that has been granted new terms, including workout terms as described previously, would be considered a TDR if it meets conditions that would indicate a borrower is experiencing financial difficulty and the new terms constitute a concession on our part. We analyze all loans where we have agreed to workout terms and all loans that we have refinanced to determine if they meet the definition of a TDR. We consider the following factors in determining whether or not a borrower is experiencing financial difficulty: • borrower is in default, • borrower has declared bankruptcy, • there is growing concern about the borrower's ability to continue as a going concern, • borrower has insufficient cash flows to service debt, • borrower's inability to obtain funds from other sources, and • there is a breach of financial covenants by the borrower. If the borrower is determined to be in financial difficulty, we consider the following conditions to determine if the borrower is granted a concession: • assets used to satisfy debt are less than our recorded investment, • interest rate is modified, • maturity date extension at an interest rate less than market rate, • capitalization of interest, • delaying principal and/or interest for a period of three months or more, and • partial forgiveness of the balance or charge-off. Mortgage loan workouts, refinances or restructures that are classified as TDRs are individually evaluated and measured for impairment. |
Commitments and Contingencies, Policy | In accordance with applicable accounting guidelines, we establish an accrued liability for litigation and regulatory matters when those matters present loss contingencies that are both probable and estimable. As a litigation or regulatory matter is developing we, in conjunction with outside counsel, evaluate on an ongoing basis whether the matter presents a loss contingency that meets conditions indicating the need for accrual and/or disclosure, and if not the matter will continue to be monitored for further developments. If and when the loss contingency related to litigation or regulatory matters is deemed to be both probable and estimable, we will establish an accrued liability with respect to that matter and will continue to monitor the matter for further developments that may affect the amount of the accrued liability. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Annuity Deposits (Net of Coinsurance), By Product Type | Annuity deposits (net of coinsurance) collected in 2018 , 2017 and 2016 , by product type were as follows: Year Ended December 31, Product Type 2018 2017 2016 (Dollars in thousands) Fixed index annuities $ 3,898,366 $ 3,668,121 $ 5,035,818 Annual reset fixed rate annuities 46,744 74,572 63,582 Multi-year fixed rate annuities 22,818 22,291 256,894 Single premium immediate annuities (SPIA) 23,813 24,946 35,851 $ 3,991,741 $ 3,789,930 $ 5,392,145 |
Fair Values of Financial Inst_2
Fair Values of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Carrying Amounts and Fair Values of Financial Instruments | The following sets forth a comparison of the carrying amounts and fair values of our financial instruments: December 31, 2018 2017 Carrying Amount Fair Value Carrying Amount Fair Value (Dollars in thousands) Assets Fixed maturity securities: Available for sale $ 45,923,727 $ 45,923,727 $ 45,372,989 $ 45,372,989 Held for investment — — 77,041 76,460 Mortgage loans on real estate 2,943,091 2,920,612 2,665,531 2,670,037 Derivative instruments 205,149 205,149 1,568,380 1,568,380 Other investments 355,531 348,970 616,764 605,894 Cash and cash equivalents 344,396 344,396 1,434,045 1,434,045 Coinsurance deposits 4,954,068 4,553,790 4,858,289 4,347,990 Interest rate caps 597 597 415 415 Interest rate swap 354 354 — — Counterparty collateral 33,101 33,101 186,108 186,108 Liabilities Policy benefit reserves 57,249,510 49,180,143 55,786,011 46,344,931 Single premium immediate annuity (SPIA) benefit reserves 270,406 279,077 282,563 292,153 Notes payable 494,591 489,985 494,093 521,800 Subordinated debentures 242,982 215,514 242,565 244,117 Amounts due under repurchase agreements 109,298 109,298 — — Interest rate swap — — 789 789 |
Assets and Liabilities Measured on a Recurring Basis by Fair Value Hierarchy | Our assets and liabilities which are measured at fair value on a recurring basis as of December 31, 2018 and 2017 are presented below based on the fair value hierarchy levels: Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (Dollars in thousands) December 31, 2018 Assets Fixed maturity securities: Available for sale: United States Government full faith and credit $ 11,652 $ 5,900 $ 5,752 $ — United States Government sponsored agencies 1,138,529 — 1,138,529 — United States municipalities, states and territories 4,126,267 — 4,126,267 — Foreign government obligations 230,274 — 230,274 — Corporate securities 28,371,514 7 28,371,507 — Residential mortgage backed securities 1,202,159 — 1,202,159 — Commercial mortgage backed securities 5,379,003 — 5,379,003 — Other asset backed securities 5,464,329 — 5,464,329 — Other investments: equity securities, available for sale 7,437 — 7,437 — Derivative instruments 205,149 — 205,149 — Cash and cash equivalents 344,396 344,396 — — Interest rate caps 597 — 597 — Interest rate swap 354 — 354 — Counterparty collateral 33,101 — 33,101 — $ 46,514,761 $ 350,303 $ 46,164,458 $ — Liabilities Fixed index annuities - embedded derivatives $ 8,165,405 $ — $ — $ 8,165,405 December 31, 2017 Assets Fixed maturity securities: Available for sale: United States Government full faith and credit $ 11,876 $ 5,640 $ 6,236 $ — United States Government sponsored agencies 1,305,017 — 1,305,017 — United States municipalities, states and territories 4,166,812 — 4,166,812 — Foreign government obligations 239,360 — 239,360 — Corporate securities 29,878,971 5 29,878,966 — Residential mortgage backed securities 1,105,567 — 1,105,567 — Commercial mortgage backed securities 5,544,850 — 5,544,850 — Other asset backed securities 3,120,536 — 3,120,536 — Other investments: equity securities, available for sale 292,429 285,000 7,429 — Derivative instruments 1,568,380 — 1,568,380 — Cash and cash equivalents 1,434,045 1,434,045 — — Interest rate caps 415 — 415 — Counterparty collateral 186,108 — 186,108 — $ 48,854,366 $ 1,724,690 $ 47,129,676 $ — Liabilities Interest rate swap $ 789 $ — $ 789 $ — Fixed index annuities - embedded derivatives 8,790,427 — — 8,790,427 $ 8,791,216 $ — $ 789 $ 8,790,427 |
Schedule of Assumptions Used in Estimating Fair Value | The following table presents average lapse rate and partial withdrawal rate assumptions, by contract duration, used in estimating the fair value of the embedded derivative component of our fixed index annuity policy benefit reserves at each reporting date: Average Lapse Rates Average Partial Withdrawal Rates Contract Duration (Years) December 31, 2018 December 31, 2017 December 31, 2018 December 31, 2017 1 - 5 2.05% 1.83% 3.33% 3.32% 6 - 10 7.28% 7.01% 3.33% 3.32% 11 - 15 11.35% 11.31% 3.35% 3.34% 16 - 20 11.90% 11.96% 3.22% 3.20% 20+ 11.57% 11.62% 3.22% 3.20% |
Liabilities Measured at Fair Value on Recurring Basis, Level 3 Reconciliation | The following table provides a reconciliation of the beginning and ending balances for our Level 3 liabilities, which are measured at fair value on a recurring basis using significant unobservable inputs for the years ended December 31, 2018 and 2017 : Year Ended December 31, 2018 2017 (Dollars in thousands) Fixed index annuities - embedded derivatives Beginning balance $ 8,790,427 $ 6,563,288 Premiums less benefits 1,542,606 2,052,985 Change in fair value, net (2,167,628 ) 174,154 Ending balance $ 8,165,405 $ 8,790,427 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments [Abstract] | |
Schedule of Fixed Maturity Securities | At December 31, 2018 and 2017 , the amortized cost and fair value of fixed maturity securities were as follows: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (Dollars in thousands) December 31, 2018 Fixed maturity securities: Available for sale: United States Government full faith and credit $ 11,872 $ 102 $ (322 ) $ 11,652 United States Government sponsored agencies 1,208,468 13,095 (83,034 ) 1,138,529 United States municipalities, states and territories 3,880,703 261,222 (15,658 ) 4,126,267 Foreign government obligations 226,860 7,573 (4,159 ) 230,274 Corporate securities 28,483,138 727,105 (838,729 ) 28,371,514 Residential mortgage backed securities 1,134,623 71,661 (4,125 ) 1,202,159 Commercial mortgage backed securities 5,492,271 21,558 (134,826 ) 5,379,003 Other asset backed securities 5,693,255 41,308 (270,234 ) 5,464,329 $ 46,131,190 $ 1,143,624 $ (1,351,087 ) $ 45,923,727 December 31, 2017 Fixed maturity securities: Available for sale: United States Government full faith and credit $ 11,861 $ 162 $ (147 ) $ 11,876 United States Government sponsored agencies 1,308,290 28,457 (31,730 ) 1,305,017 United States municipalities, states and territories 3,804,360 366,048 (3,596 ) 4,166,812 Foreign government obligations 228,214 13,171 (2,025 ) 239,360 Corporate securities 28,127,653 1,897,005 (145,687 ) 29,878,971 Residential mortgage backed securities 1,028,484 79,554 (2,471 ) 1,105,567 Commercial mortgage backed securities 5,531,922 82,768 (69,840 ) 5,544,850 Other asset backed securities 3,075,975 57,966 (13,405 ) 3,120,536 $ 43,116,759 $ 2,525,131 $ (268,901 ) $ 45,372,989 Held for investment: Corporate security $ 77,041 $ — $ (581 ) $ 76,460 Other investments: equity securities, available for sale $ 292,429 $ — $ — $ 292,429 |
Schedule of Fixed Maturity Securities by Contractual Maturity Date | The amortized cost and fair value of fixed maturity securities at December 31, 2018 , by contractual maturity are shown below. Actual maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. All of our mortgage and other asset backed securities provide for periodic payments throughout their lives and are shown below as separate lines. Available for sale Amortized Cost Fair Value (Dollars in thousands) Due in one year or less $ 365,686 $ 368,836 Due after one year through five years 5,426,450 5,416,871 Due after five years through ten years 9,918,504 9,768,751 Due after ten years through twenty years 9,565,686 9,895,985 Due after twenty years 8,534,715 8,427,793 33,811,041 33,878,236 Residential mortgage backed securities 1,134,623 1,202,159 Commercial mortgage backed securities 5,492,271 5,379,003 Other asset backed securities 5,693,255 5,464,329 $ 46,131,190 $ 45,923,727 |
Schedule of Components of Net Unrealized Gains (Losses) on Available For Sale Fixed Maturity Securities Reported as Separate Component of Stockholders' Equity | Net unrealized gains (losses) on available for sale fixed maturity securities reported as a separate component of stockholders' equity were comprised of the following: December 31, 2018 2017 (Dollars in thousands) Net unrealized gains (losses) on available for sale fixed maturity securities $ (207,463 ) $ 2,256,230 Adjustments for assumed changes in amortization of deferred policy acquisition costs and deferred sales inducements 112,571 (1,206,078 ) Deferred income tax valuation allowance reversal 22,534 22,534 Deferred income tax benefit (expense) (a) 19,926 (348,087 ) Net unrealized gains (losses) reported as accumulated other comprehensive income (loss) $ (52,432 ) $ 724,599 (a) December 31, 2017 includes $128 million related to the impact of Tax Reform that was reclassified between accumulated other comprehensive income (loss) and retained earnings within our consolidated balance sheet during the first quarter of 2018. For more information regarding the reclassification, see Note 1. |
Schedule of Credit Quality of Fixed Maturity Security Portfolio by NAIC Designation | The following table summarizes the credit quality, as determined by NAIC designation, of our fixed maturity portfolio as of the dates indicated: December 31, 2018 2017 NAIC Designation Amortized Cost Fair Value Amortized Cost Fair Value (Dollars in thousands) 1 $ 26,588,352 $ 26,921,843 $ 26,669,427 $ 28,274,379 2 17,901,161 17,528,072 15,198,551 15,869,219 3 1,396,650 1,269,242 1,161,737 1,157,420 4 173,987 137,991 134,838 117,542 5 23,836 19,453 17,015 20,927 6 47,204 47,126 12,232 9,962 $ 46,131,190 $ 45,923,727 $ 43,193,800 $ 45,449,449 |
Schedule of Gross Unrealized Losses on Investments, By Category and Length of Time | The following table shows our investments' gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities (consisting of 2,715 and 955 securities, respectively) have been in a continuous unrealized loss position, at December 31, 2018 and 2017 : Less than 12 months 12 months or more Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses (Dollars in thousands) December 31, 2018 Fixed maturity securities: Available for sale: United States Government full faith and credit $ 543 $ (3 ) $ 7,785 $ (319 ) $ 8,328 $ (322 ) United States Government sponsored agencies 30,089 (949 ) 953,421 (82,085 ) 983,510 (83,034 ) United States municipalities, states and territories 340,103 (6,816 ) 162,997 (8,842 ) 503,100 (15,658 ) Foreign government obligations 98,511 (1,748 ) 11,859 (2,411 ) 110,370 (4,159 ) Corporate securities: Finance, insurance and real estate 2,501,640 (87,220 ) 884,870 (77,507 ) 3,386,510 (164,727 ) Manufacturing, construction and mining 2,045,859 (84,972 ) 349,738 (34,635 ) 2,395,597 (119,607 ) Utilities and related sectors 2,313,271 (82,119 ) 591,482 (45,838 ) 2,904,753 (127,957 ) Wholesale/retail trade 1,032,603 (51,228 ) 198,805 (26,326 ) 1,231,408 (77,554 ) Services, media and other 4,618,477 (196,520 ) 1,072,722 (152,364 ) 5,691,199 (348,884 ) Residential mortgage backed securities 145,613 (2,638 ) 22,689 (1,487 ) 168,302 (4,125 ) Commercial mortgage backed securities 2,141,560 (37,150 ) 2,090,835 (97,676 ) 4,232,395 (134,826 ) Other asset backed securities 4,073,249 (252,265 ) 271,994 (17,969 ) 4,345,243 (270,234 ) $ 19,341,518 $ (803,628 ) $ 6,619,197 $ (547,459 ) $ 25,960,715 $ (1,351,087 ) December 31, 2017 Fixed maturity securities: Available for sale: United States Government full faith and credit $ 1,565 $ (10 ) $ 6,731 $ (137 ) $ 8,296 $ (147 ) United States Government sponsored agencies 44,794 (180 ) 958,965 (31,550 ) 1,003,759 (31,730 ) United States municipalities, states and territories 44,736 (128 ) 128,499 (3,468 ) 173,235 (3,596 ) Foreign government obligations 49,663 (337 ) 12,625 (1,688 ) 62,288 (2,025 ) Corporate securities: Finance, insurance and real estate 456,244 (5,135 ) 600,655 (28,043 ) 1,056,899 (33,178 ) Manufacturing, construction and mining 222,985 (3,475 ) 231,196 (10,849 ) 454,181 (14,324 ) Utilities and related sectors 395,183 (4,099 ) 249,416 (8,901 ) 644,599 (13,000 ) Wholesale/retail trade 152,941 (1,249 ) 178,635 (11,371 ) 331,576 (12,620 ) Services, media and other 729,124 (19,000 ) 891,654 (53,565 ) 1,620,778 (72,565 ) Residential mortgage backed securities 39,771 (387 ) 32,917 (2,084 ) 72,688 (2,471 ) Commercial mortgage backed securities 1,096,757 (10,385 ) 1,306,437 (59,455 ) 2,403,194 (69,840 ) Other asset backed securities 765,531 (3,499 ) 217,595 (9,906 ) 983,126 (13,405 ) $ 3,999,294 $ (47,884 ) $ 4,815,325 $ (221,017 ) $ 8,814,619 $ (268,901 ) Held for investment: Corporate security: Insurance $ — $ — $ 76,460 $ (581 ) $ 76,460 $ (581 ) |
Schedule of Changes in Net Unrealized Gains/Losses on Investments | Changes in net unrealized gains/losses on investments for the years ended December 31, 2018 , 2017 and 2016 are as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Fixed maturity securities held for investment carried at amortized cost $ 581 $ 7,478 $ 3,186 Investments carried at fair value: Fixed maturity securities, available for sale $ (2,463,693 ) $ 1,149,691 $ 508,410 Equity securities, available for sale — (479 ) 166 (2,463,693 ) 1,149,212 508,576 Adjustment for effect on other balance sheet accounts: Deferred policy acquisition costs and deferred sales inducements 1,318,649 (587,417 ) (295,802 ) Deferred income tax asset/liability 240,459 (177,162 ) (74,471 ) 1,559,108 (764,579 ) (370,273 ) Change in net unrealized gains/losses on investments carried at fair value $ (904,585 ) $ 384,633 $ 138,303 |
Components of Net Investment Income | Components of net investment income are as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Fixed maturity securities $ 2,027,599 $ 1,876,542 $ 1,729,176 Equity securities 4,735 764 531 Mortgage loans on real estate 131,259 122,680 122,985 Cash and cash equivalents 2,320 2,562 3,201 Other 1,548 4,073 5,499 2,167,461 2,006,621 1,861,392 Less investment expenses (19,649 ) (14,624 ) (11,520 ) Net investment income $ 2,147,812 $ 1,991,997 $ 1,849,872 |
Net Realized Gains (Losses) on Investments, Excluding Net OTTI Losses | Net realized gains (losses) on investments, excluding net OTTI losses are as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Available for sale fixed maturity securities: Gross realized gains $ 12,245 $ 18,254 $ 14,132 Gross realized losses (47,974 ) (9,058 ) (4,036 ) (35,729 ) 9,196 10,096 Available for sale equity securities: Gross realized gains — 348 — Other investments: Gain on sale of real estate — 56 884 Loss on sale of real estate — — (93 ) — 56 791 Mortgage loans on real estate: Decrease (increase) in allowance for credit losses (3,165 ) 278 (4,846 ) Recovery of specific allowance 1,592 631 5,483 Gain on sale of mortgage loans 124 — — (1,449 ) 909 637 $ (37,178 ) $ 10,509 $ 11,524 |
Non-Income Producing Investments | The following table summarizes the carrying value of our investments that have been non-income producing for 12 consecutive months: December 31, 2018 2017 (Dollars in thousands) Fixed maturity securities, available for sale $ 6,717 $ 8,680 |
Other Than Temporary Impairment by Asset Type | The following table summarizes other than temporary impairments by asset type: Number of Securities Total OTTI Losses Portion of OTTI Losses Recognized in (from) Other Comprehensive Income Net OTTI Losses Recognized in Operations (Dollars in thousands) Year ended December 31, 2018 Fixed maturity securities, available for sale: Corporate securities: Capital goods 1 $ (719 ) $ — $ (719 ) Consumer discretionary 8 (9,533 ) — (9,533 ) Energy 4 (4,793 ) — (4,793 ) Financials 5 (3,495 ) — (3,495 ) Information technology 1 (550 ) — (550 ) Industrials 1 (2,299 ) — (2,299 ) Telecommunications 2 (249 ) — (249 ) Transportation 1 (178 ) — (178 ) Utilities 2 (5,518 ) — (5,518 ) Residential mortgage backed securities 3 (63 ) (295 ) (358 ) Commercial mortgage backed securities 5 (4,859 ) — (4,859 ) Other asset backed securities 2 (2,749 ) (1,356 ) (4,105 ) 35 $ (35,005 ) $ (1,651 ) $ (36,656 ) Year ended December 31, 2017 Fixed maturity securities, available for sale: Corporate securities: Industrials 1 $ (2,485 ) $ — $ (2,485 ) Residential mortgage backed securities 8 (273 ) (1,585 ) (1,858 ) Other asset backed securities 1 — (287 ) (287 ) 10 $ (2,758 ) $ (1,872 ) $ (4,630 ) Year ended December 31, 2016 Fixed maturity securities, available for sale: Corporate securities: Energy 2 $ (642 ) $ — $ (642 ) Materials 1 (4,554 ) 1,575 (2,979 ) Telecommunications 1 (4,462 ) 562 (3,900 ) Utilities 2 (6,961 ) 798 (6,163 ) Residential mortgage backed securities 9 — (783 ) (783 ) Commercial mortgage backed securities 5 (1,540 ) — (1,540 ) Other asset backed securities 2 (3,190 ) (3,482 ) (6,672 ) 22 $ (21,349 ) $ (1,330 ) $ (22,679 ) |
Other Than Temporary Impairment, Credit Losses Recognized in Earnings | The cumulative portion of other than temporary impairments determined to be credit losses which have been recognized in operations for debt securities are summarized as follows: Year Ended December 31, 2018 2017 (Dollars in thousands) Cumulative credit loss at beginning of year $ (157,066 ) $ (166,375 ) Additions for the amount related to credit losses for which OTTI has not previously been recognized (35,005 ) (2,758 ) Additional credit losses on securities for which OTTI has previously been recognized (1,651 ) (1,872 ) Accumulated losses on securities that were disposed of during the period 18,324 13,939 Cumulative credit loss at end of year $ (175,398 ) $ (157,066 ) |
Schedule of Other Than Temporary Impairment Losses, Investments | The following table summarizes the cumulative noncredit portion of OTTI and the change in fair value since recognition of OTTI, both of which were recognized in other comprehensive income, by major type of security, for securities that are part of our investment portfolio at December 31, 2018 and 2017 : Amortized Cost OTTI Recognized in Other Comprehensive Income (Loss) Change in Fair Value Since OTTI was Recognized Fair Value (Dollars in thousands) December 31, 2018 Fixed maturity securities, available for sale: Corporate securities $ 69,580 $ (3,700 ) $ 6,195 $ 72,075 Residential mortgage backed securities 245,691 (167,846 ) 199,191 277,036 Commercial mortgage backed securities 35,244 — — 35,244 Other asset backed securities 1,692 — 326 2,018 $ 352,207 $ (171,546 ) $ 205,712 $ 386,373 December 31, 2017 Fixed maturity securities, available for sale: Corporate securities $ 13,015 $ (4,263 ) $ 10,739 $ 19,491 Residential mortgage backed securities 297,582 (168,355 ) 201,620 330,847 Other asset backed securities 4,567 (1,356 ) (1,875 ) 1,336 $ 315,164 $ (173,974 ) $ 210,484 $ 351,674 |
Mortgage Loans on Real Estate (
Mortgage Loans on Real Estate (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Summary of Mortgage Loan Portfolio | Our mortgage loan portfolio is summarized in the following table. There were commitments outstanding of $148.0 million at December 31, 2018 . December 31, 2018 2017 (Dollars in thousands) Principal outstanding $ 2,952,464 $ 2,674,315 Loan loss allowance (8,239 ) (7,518 ) Deferred prepayment fees (1,134 ) (1,266 ) Carrying value $ 2,943,091 $ 2,665,531 |
Mortgage Loan Portfolio Summarized by Geographic Region and Property Type | The mortgage loan portfolio is summarized by geographic region and property type as follows: December 31, 2018 2017 Principal Percent Principal Percent (Dollars in thousands) Geographic distribution East $ 586,773 19.9 % $ 548,067 20.5 % Middle Atlantic 168,969 5.7 % 163,485 6.1 % Mountain 357,642 12.1 % 308,486 11.5 % New England 9,418 0.3 % 12,265 0.5 % Pacific 521,363 17.7 % 466,030 17.4 % South Atlantic 694,599 23.5 % 609,736 22.8 % West North Central 291,890 9.9 % 324,808 12.2 % West South Central 321,810 10.9 % 241,438 9.0 % $ 2,952,464 100.0 % $ 2,674,315 100.0 % Property type distribution Office $ 268,932 9.1 % $ 283,926 10.6 % Medical Office 33,467 1.1 % 34,338 1.3 % Retail 1,091,627 37.0 % 1,040,028 38.9 % Industrial/Warehouse 762,887 25.8 % 677,770 25.3 % Apartment 600,638 20.3 % 462,897 17.3 % Agricultural 25,000 0.9 % — — % Mixed use/Other 169,913 5.8 % 175,356 6.6 % $ 2,952,464 100.0 % $ 2,674,315 100.0 % |
Rollforward of Allowance For Credit Losses | The following table presents a rollforward of our specific and general valuation allowances for mortgage loans on real estate: Year Ended December 31, 2018 2017 2016 Specific Allowance General Allowance Specific Allowance General Allowance Specific Allowance General Allowance (Dollars in thousands) Beginning allowance balance $ (1,418 ) $ (6,100 ) $ (1,327 ) $ (7,100 ) $ (7,842 ) $ (6,300 ) Charge-offs 852 — — — 5,078 — Recoveries 1,592 — 631 — 5,483 — Change in provision for credit losses (1,255 ) (1,910 ) (722 ) 1,000 (4,046 ) (800 ) Ending allowance balance $ (229 ) $ (8,010 ) $ (1,418 ) $ (6,100 ) $ (1,327 ) $ (7,100 ) |
Impaired Mortgage Loans on Real Estate by Basis of Impairment | The following table presents the total outstanding principal of loans evaluated for impairment by basis of impairment method: December 31, 2018 2017 2016 (Dollars in thousands) Individually evaluated for impairment $ 1,253 $ 5,445 $ 4,640 Collectively evaluated for impairment 2,951,211 2,668,870 2,485,979 Total loans evaluated for impairment $ 2,952,464 $ 2,674,315 $ 2,490,619 |
Mortgage Loans By Credit Quality Indicator | We analyze credit risk of our mortgage loans by analyzing all available evidence on loans that are delinquent and loans that are in a workout period. December 31, 2018 2017 (Dollars in thousands) Credit Exposure - By Payment Activity Performing $ 2,952,464 $ 2,670,657 In workout — 1,436 Collateral dependent — 2,222 $ 2,952,464 $ 2,674,315 |
Aging of Financing Receivables | Aging of financing receivables is summarized in the following table, with loans in a "workout" period as of the reporting date considered current if payments are current in accordance with agreed upon terms: 30 - 59 Days 60 - 89 Days 90 Days and Over Total Past Due Current Collateral Dependent Receivables Total Financing Receivables (Dollars in thousands) Commercial Mortgage Loans December 31, 2018 $ — $ — $ — $ — $ 2,952,464 $ — $ 2,952,464 December 31, 2017 $ — $ — $ — $ — $ 2,672,093 $ 2,222 $ 2,674,315 |
Impaired Financing Receivables | Financing receivables summarized in the following two tables represent all loans that we are either not currently collecting, or those we feel it is probable we will not collect all amounts due according to the contractual terms of the loan agreements (all loans that we have worked with the borrower to alleviate short-term cash flow issues, loans delinquent for 60 days or more at the reporting date, loans we have determined to be collateral dependent and loans that we have recorded specific impairments on that we feel may continue to have performance issues). Recorded Investment Unpaid Principal Balance Related Allowance (Dollars in thousands) December 31, 2018 Mortgage loans with an allowance $ 1,024 $ 1,253 $ (229 ) Mortgage loans with no related allowance — — — $ 1,024 $ 1,253 $ (229 ) December 31, 2017 Mortgage loans with an allowance $ 4,027 $ 5,445 $ (1,418 ) Mortgage loans with no related allowance 1,436 1,436 — $ 5,463 $ 6,881 $ (1,418 ) Average Recorded Investment Interest Income Recognized (Dollars in thousands) December 31, 2018 Mortgage loans with an allowance $ 1,042 $ 74 Mortgage loans with no related allowance — — $ 1,042 $ 74 December 31, 2017 Mortgage loans with an allowance $ 4,464 $ 221 Mortgage loans with no related allowance 1,513 91 $ 5,977 $ 312 December 31, 2016 Mortgage loans with an allowance $ 3,398 $ 301 Mortgage loans with no related allowance 1,665 73 $ 5,063 $ 374 |
Troubled Debt Restructurings on Financing Receivables | A summary of mortgage loans on commercial real estate with outstanding principal at December 31, 2017 that we determined to be TDRs are as follows: Geographic Region Number of TDRs Principal Balance Outstanding Specific Loan Loss Allowance Net Carrying Amount (Dollars in thousands) Year ended December 31, 2017 South Atlantic 1 $ 2,947 $ — $ 2,947 East 1 1,933 (467 ) 1,466 2 $ 4,880 $ (467 ) $ 4,413 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair Value of Derivative Instruments as Presented in the Consolidated Balance Sheets | The fair value of our derivative instruments, including derivative instruments embedded in fixed index annuity contracts, presented in the consolidated balance sheets are as follows: December 31, 2018 2017 (Dollars in thousands) Assets Derivative instruments Call options $ 205,149 $ 1,568,380 Other assets Interest rate caps 597 415 Interest rate swap 354 — $ 206,100 $ 1,568,795 Liabilities Policy benefit reserves - annuity products Fixed index annuities - embedded derivatives, net $ 8,165,405 $ 8,790,427 Other liabilities Interest rate swap — 789 $ 8,165,405 $ 8,791,216 |
Schedule of Changes in Fair Value of Derivative Instruments | The changes in fair value of derivatives included in the consolidated statements of operations are as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Change in fair value of derivatives: Call options $ (778,899 ) $ 1,678,283 $ 165,029 Interest rate swap 869 255 (482 ) Interest rate caps 182 (667 ) (328 ) $ (777,848 ) $ 1,677,871 $ 164,219 Change in fair value of embedded derivatives: Fixed index annuities - embedded derivatives (see Note 2) $ (2,167,628 ) $ 174,154 $ 145,045 Other changes in difference between policy benefit reserves computed using derivative accounting vs. long-duration contracts accounting 778,137 745,581 398,420 $ (1,389,491 ) $ 919,735 $ 543,465 |
Schedule of Call Options by Counterparty | The notional amount and fair value of our call options by counterparty and each counterparty's current credit rating are as follows: December 31, 2018 2017 Counterparty Credit Rating (S&P) Credit Rating (Moody's) Notional Amount Fair Value Notional Amount Fair Value (Dollars in thousands) Bank of America A+ Aa3 $ 6,518,808 $ 6,704 $ 4,645,366 $ 237,955 Barclays A A2 2,301,414 27,032 4,135,537 154,127 BNP Paribas A Aa3 — — 1,411,989 73,650 Canadian Imperial Bank of Commerce A+ Aa2 4,856,150 29,313 2,808,030 84,268 Citibank, N.A. A+ A1 4,792,208 27,239 4,104,666 219,900 Credit Suisse A A1 2,877,916 12,887 3,538,855 137,384 J.P. Morgan A+ Aa2 3,701,964 17,564 1,753,649 109,689 Morgan Stanley A+ A1 3,560,044 1,561 3,408,179 184,323 Royal Bank of Canada AA- A2 1,871,305 14,011 3,027,469 104,141 Societe Generale A A1 2,343,165 21,681 — — SunTrust A- Baa1 1,755,030 12,047 2,331,168 90,399 Wells Fargo A+ Aa2 4,618,569 33,398 4,036,255 162,781 Exchange traded 224,204 1,712 296,840 9,763 $ 39,420,777 $ 205,149 $ 35,498,003 $ 1,568,380 |
Schedule of Interest Rate Derivatives | Details regarding the interest rate swap are as follows: December 31, 2018 2017 Maturity Date Notional Amount Receive Rate Pay Rate Counterparty Fair Value Fair Value (Dollars in thousands) March 15, 2021 $ 85,500 LIBOR 2.415% SunTrust $ 354 $ (789 ) Details regarding the interest rate caps are as follows: December 31, 2018 2017 Maturity Date Notional Amount Floating Rate Cap Rate Counterparty Fair Value Fair Value (Dollars in thousands) July 7, 2021 $ 40,000 LIBOR 2.50% SunTrust $ 302 $ 207 July 8, 2021 12,000 LIBOR 2.50% SunTrust 91 62 July 29, 2021 27,000 LIBOR 2.50% SunTrust 204 146 $ 79,000 $ 597 $ 415 |
Deferred Policy Acquisition C_2
Deferred Policy Acquisition Costs, Deferred Sales Inducements and Liability for Lifetime Income Benefit Riders (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Insurance [Abstract] | |
Rollforward of Deferred Policy Acquisition Costs | Policy acquisition costs deferred and amortized are as follows: December 31, 2018 2017 2016 (Dollars in thousands) Balance at beginning of year $ 2,714,523 $ 2,905,377 $ 2,905,136 Costs deferred during the year: Commissions 384,432 401,124 538,863 Policy issue costs 3,790 5,517 4,462 Amortization: Amortization (358,563 ) (304,162 ) (325,848 ) Impact of unlocking 30,572 48,198 (48,164 ) Effect of net unrealized gains/losses 761,084 (341,531 ) (169,072 ) Balance at end of year $ 3,535,838 $ 2,714,523 $ 2,905,377 |
Rollforward of Deferred Sales Inducements | Sales inducements deferred and amortized are as follows: December 31, 2018 2017 2016 (Dollars in thousands) Balance at beginning of year $ 2,001,892 $ 2,208,218 $ 2,232,148 Costs deferred during the year 179,465 216,172 353,966 Amortization: Amortization (243,666 ) (210,886 ) (215,406 ) Impact of unlocking 21,465 34,274 (35,760 ) Effect of net unrealized gains/losses 557,565 (245,886 ) (126,730 ) Balance at end of year $ 2,516,721 $ 2,001,892 $ 2,208,218 |
Rollforward of Liability for Lifetime Income Benefit Riders (Net of Coinsurance Ceded) | The following table presents a rollforward of the liability for lifetime income benefit riders (net of coinsurance ceded): December 31, 2018 2017 2016 (Dollars in thousands) Balance at beginning of year $ 704,441 $ 533,391 $ 351,946 Benefit expense accrual 157,333 149,442 139,443 Impact of unlocking (53,607 ) 21,608 42,002 Claim payments — — — Balance at end of year $ 808,167 $ 704,441 $ 533,391 |
Reinsurance and Policy Provis_2
Reinsurance and Policy Provisions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Reinsurance Disclosures [Abstract] | |
Amounts Ceded to EquiTrust and Athene, Impact on Consolidated Statements of Operations and Cash Flows | Amounts ceded to EquiTrust and Athene under these agreements are as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Consolidated Statements of Operations Annuity product charges $ 7,074 $ 6,458 $ 5,366 Change in fair value of derivatives (41,487 ) 94,382 18,446 $ (34,413 ) $ 100,840 $ 23,812 Interest sensitive and index product benefits $ 165,485 $ 177,332 $ 93,487 Change in fair value of embedded derivatives (92,649 ) 35,561 23,848 Other operating costs and expenses 20,415 19,877 24,039 $ 93,251 $ 232,770 $ 141,374 Consolidated Statements of Cash Flows Annuity deposits $ (413,222 ) $ (387,280 ) $ (1,736,054 ) Cash payments to policyholders 389,384 380,683 418,499 $ (23,838 ) $ (6,597 ) $ (1,317,555 ) |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Components of Income Tax Expense | Our income tax expense as presented in the consolidated financial statements is summarized as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Consolidated statements of operations: Current income taxes $ 120,289 $ 188,356 $ 57,412 Deferred income taxes (benefits) (12,563 ) (46,730 ) (10,408 ) Total income tax expense included in consolidated statements of operations 107,726 141,626 47,004 Stockholders' equity: Expense (benefit) relating to: Change in net unrealized investment losses (240,459 ) 177,162 74,471 Share-based compensation — — (527 ) Total income tax expense (benefit) included in consolidated financial statements $ (132,733 ) $ 318,788 $ 120,948 |
Effective Income Tax Rate Reconciliation | Income tax expense in the consolidated statements of operations differed from the amount computed at the applicable statutory federal income tax rates of 21% for the year ended December 31, 2018 and 35% for the years ended December 31, 2017 and 2016 as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) Income before income taxes $ 565,742 $ 316,271 $ 130,247 Income tax expense on income before income taxes $ 118,806 $ 110,695 $ 45,586 Tax effect of: State income taxes 5,777 1,961 2,559 Tax exempt net investment income (4,223 ) (4,288 ) (2,167 ) Impact of Tax Reform — 35,932 — Worthless stock deduction (7,448 ) — — Other (5,186 ) (2,674 ) 1,026 Income tax expense $ 107,726 $ 141,626 $ 47,004 Effective tax rate 19.0 % 44.8 % 36.1 % |
Deferred Tax Assets and Liabilities | The tax effects of temporary differences that give rise to the deferred tax assets and liabilities at December 31, 2018 and 2017 , are as follows: December 31, 2018 2017 (Dollars in thousands) Deferred income tax assets: Policy benefit reserves $ 1,538,371 $ 1,842,049 Other than temporary impairments 9,804 11,262 Net unrealized losses on available for sale securities 19,928 — Derivative instruments 141,075 — Amounts due reinsurer — 6,852 Other policyholder funds 3,368 3,724 Deferred compensation 3,334 3,827 Share-based compensation 3,169 3,383 State net operating loss carryforwards 2,286 3,196 Other 9,439 10,253 Gross deferred tax assets 1,730,774 1,884,546 Deferred income tax liabilities: Deferred policy acquisition costs and deferred sales inducements (1,214,998 ) (1,212,509 ) Net unrealized gains on available for sale fixed maturity and equity securities — (220,533 ) Derivative instruments — (179,776 ) Policy benefit reserves (172,578 ) (197,233 ) Investment income items (37,795 ) (34,849 ) Amounts due reinsurer (12,620 ) — Other (1,614 ) (1,499 ) Gross deferred tax liabilities (1,439,605 ) (1,846,399 ) Net deferred income tax asset $ 291,169 $ 38,147 |
Notes and Loan Payable and Am_2
Notes and Loan Payable and Amounts Due Under Repurchase Agreements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | Notes payable includes the following: December 31, 2018 2017 (Dollars in thousands) Senior notes due 2027 Principal $ 500,000 $ 500,000 Unamortized debt issue costs (5,102 ) (5,572 ) Unamortized discount (307 ) (335 ) $ 494,591 $ 494,093 |
Subordinated Debentures (Tables
Subordinated Debentures (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Subordinated Borrowings [Abstract] | |
Summary of Subordinated Debt Obligations to the Trusts | Following is a summary of subordinated debt obligations to the trusts at December 31, 2018 and 2017 : December 31, 2018 2017 Interest Rate Due Date (Dollars in thousands) American Equity Capital Trust II $ 77,551 $ 77,298 5% June 1, 2047 American Equity Capital Trust III 27,840 27,840 *LIBOR + 3.90% April 29, 2034 American Equity Capital Trust IV 12,372 12,372 *LIBOR + 4.00% January 8, 2034 American Equity Capital Trust VII 10,830 10,830 *LIBOR + 3.75% December 14, 2034 American Equity Capital Trust VIII 20,620 20,620 *LIBOR + 3.75% December 15, 2034 American Equity Capital Trust IX 15,470 15,470 *LIBOR + 3.65% June 15, 2035 American Equity Capital Trust X 20,620 20,620 *LIBOR + 3.65% September 15, 2035 American Equity Capital Trust XI 20,620 20,620 *LIBOR + 3.65% December 15, 2035 American Equity Capital Trust XII 41,238 41,238 *LIBOR + 3.50% April 7, 2036 247,161 246,908 Unamortized debt issue costs (4,179 ) (4,343 ) $ 242,982 $ 242,565 *—three month London Interbank Offered Rate |
Retirement and Share-based Co_2
Retirement and Share-based Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Compensation Expense By Plan | The following table summarizes compensation expense recognized for employees and directors as a result of share-based compensation: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) ESOP $ 2,194 $ 1,474 $ 2,522 Employee Incentive Plans 5,434 2,155 1,207 Director Equity Plans 966 812 685 $ 8,594 $ 4,441 $ 4,414 |
Changes in Stock Options Outstanding | Changes in the number of stock options granted to employees and agents outstanding during the years ended December 31, 2018 , 2017 and 2016 are as follows: Number of Shares Weighted-Average Exercise Price per Share Total Exercise Price (Dollars in thousands, except per share data) Outstanding at January 1, 2016 3,443,991 $ 15.17 $ 52,240 Granted — — — Canceled (24,700 ) 14.83 (366 ) Exercised (500,345 ) 9.97 (4,989 ) Outstanding at December 31, 2016 2,918,946 16.06 46,885 Granted — — — Canceled (57,200 ) 13.66 (781 ) Exercised (881,481 ) 15.90 (14,020 ) Outstanding at December 31, 2017 1,980,265 16.20 32,084 Granted — — — Canceled (40,850 ) 18.87 (771 ) Exercised (717,550 ) 13.99 (10,040 ) Outstanding at December 31, 2018 1,221,865 17.41 $ 21,273 |
Schedule of Stock Options Outstanding, By Exercise Price Range | The following table summarizes information about stock options outstanding at December 31, 2018 : Stock Options Outstanding and Vested Range of Exercise Prices Number of Awards Remaining Life (yrs) Weighted-Average Exercise Price Per Share $5.07 - $8.02 122,500 0.36 $ 6.77 $9.27 - $11.35 252,515 1.54 9.97 $12.04 - $24.79 846,850 1.84 21.17 $5.07 - $24.79 1,221,865 1.63 17.41 |
Statutory Financial Informati_2
Statutory Financial Information and Dividend Restrictions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Insurance [Abstract] | |
Statutory Accounting Practices Disclosure | Net income for our primary life insurance subsidiary as determined in accordance with statutory accounting practices was as follows: Year Ended December 31, 2018 2017 2016 (Dollars in thousands) American Equity Life $ 210,049 $ 375,900 $ 75,035 Statutory capital and surplus for our primary life insurance subsidiary was as follows: December 31, 2018 2017 (Dollars in thousands) American Equity Life $ 3,251,881 $ 3,005,654 Calculations using the NAIC formula indicated that American Equity Life's ratio of total adjusted capital to the highest level of required capital at which regulatory action might be initiated (Company Action Level) is as follows: December 31, 2018 2017 (Dollars in thousands) Total adjusted capital $ 3,542,339 $ 3,260,328 Company Action Level RBC 983,169 861,419 Ratio of adjusted capital to Company Action Level RBC 360 % 378 % |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | The following represents payments due by period for operating lease obligations as of December 31, 2018 (dollars in thousands): Year Ending December 31: 2019 $ 1,986 2020 2,037 2021 1,841 2022 1,680 2023 1,481 2024 and thereafter 4,364 |
Earnings Per Share and Stockh_2
Earnings Per Share and Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of earnings per common share and earnings per common share - assuming dilution: Year Ended December 31, 2018 2017 2016 (Dollars in thousands, except per share data) Numerator: Net income - numerator for earnings per common share $ 458,016 $ 174,645 $ 83,243 Denominator : Weighted average common shares outstanding 90,347,915 88,982,442 84,793,151 Effect of dilutive securities: Warrants — — 15,136 Stock options and deferred compensation agreements 709,433 945,612 456,236 Restricted stock and restricted stock units 365,237 382,954 340,646 Denominator for earnings per common share - assuming dilution 91,422,585 90,311,008 85,605,169 Earnings per common share $ 5.07 $ 1.96 $ 0.98 Earnings per common share - assuming dilution $ 5.01 $ 1.93 $ 0.97 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | Options to purchase shares of our common stock that were outstanding during the respective periods indicated but were not included in the computation of diluted earnings per share because the options' exercise price was greater than the average market price of the common shares are as follows: Period Number of Shares Range of Exercise Prices Minimum Maximum Year ended December 31, 2018 — $— $— Year ended December 31, 2017 — $— $— Year ended December 31, 2016 1,054,091 $24.79 $24.79 |
Quarterly Financial Informati_2
Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information | Unaudited quarterly results of operations are summarized below. Quarter Ended March 31, June 30, September 30, December 31, (Dollars in thousands, except per share data) 2018 Premiums and product charges $ 59,776 $ 60,763 $ 65,605 $ 64,824 Net investment income 510,784 533,282 549,391 554,355 Change in fair value of derivatives (451,083 ) 132,205 595,311 (1,054,281 ) Net realized gains (losses) on investments, excluding OTTI losses 302 (38,381 ) (2,196 ) 3,097 Net OTTI losses recognized in operations (907 ) (2,396 ) (14,373 ) (18,980 ) Total revenues 118,872 685,473 1,193,738 (450,985 ) Net income 140,962 93,903 169,328 53,823 Earnings per common share 1.57 1.04 1.87 0.59 Earnings per common share - assuming dilution 1.55 1.03 1.85 0.59 2017 Premiums and product charges $ 52,974 $ 56,323 $ 60,500 $ 64,925 Net investment income 485,597 493,489 500,202 512,709 Change in fair value of derivatives 386,533 266,820 362,525 661,993 Net realized gains on investments, excluding OTTI losses 2,338 3,873 1,579 2,719 Net OTTI losses recognized in operations (141 ) (949 ) (464 ) (3,076 ) Loss on extinguishment of debt — (428 ) (18,389 ) — Total revenues 927,301 819,128 905,953 1,239,270 Net income 53,939 26,946 56,957 36,803 Earnings per common share 0.61 0.30 0.64 0.41 Earnings per common share - assuming dilution 0.60 0.30 0.63 0.41 The differences between the change in fair value of derivatives for each quarter primarily correspond to the performance of the indices upon which our call options are based. The comparability of net income is impacted by the application of fair value accounting to our fixed index annuity business as follows: Quarter Ended March 31, June 30, September 30, December 31, (Dollars in thousands) 2018 $ (61,794 ) $ (23,593 ) $ 427 $ 28,298 2017 7,069 37,075 30,806 3,518 |
Significant Accounting Polici_4
Significant Accounting Policies (Narrative) (Details) $ in Millions | Jan. 01, 2018 | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($)states | Dec. 31, 2017USD ($) | Dec. 31, 2016 |
Accounting Policies [Abstract] | |||||
Number of states in which entity is licensed to sell insurance products | states | 50 | ||||
Number of days past due, non-accrual status | 90 days | ||||
Statutory federal income tax rate | 21.00% | 21.00% | 35.00% | 35.00% | |
Minimum | |||||
Interest crediting rate, range for fixed index annuities and other deferred annuity products | 1.00% | 1.00% | 1.00% | ||
Maximum | |||||
Interest crediting rate, range for fixed index annuities and other deferred annuity products | 3.30% | 3.30% | 3.30% | ||
Maximum | Cash and Cash Equivalents | |||||
Investment maturity period (less than) | 3 months | ||||
Accounting Standards Update 2016-09 | |||||
New accounting pronouncement, effect of adoption, quantification | $ 2.8 | $ 2.7 | |||
Accounting Standards Update 2018-02 | |||||
New accounting pronouncement, effect of adoption, quantification | $ 128 | $ 128 | |||
Forecast | Accounting Standards Update 2016-02 | |||||
New accounting pronouncement, effect of adoption, quantification | $ 3.7 |
Significant Accounting Polici_5
Significant Accounting Policies (Annuity Deposits (Net of Coinsurance), By Product Type) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)NMOs | Dec. 31, 2017USD ($)NMOs | Dec. 31, 2016USD ($)NMOs | |
Product Information [Line Items] | |||
Fixed index annuities | $ 3,898,366 | $ 3,668,121 | $ 5,035,818 |
Annual reset fixed rate annuities | 46,744 | 74,572 | 63,582 |
Multi-year fixed rate annuities | 22,818 | 22,291 | 256,894 |
Single premium immediate annuities (SPIA) | 23,813 | 24,946 | 35,851 |
Annuity deposits, net of coinsurance | $ 3,991,741 | $ 3,789,930 | $ 5,392,145 |
Customer Concentration Risk | |||
Product Information [Line Items] | |||
National marketing organizations, number of organizations accounting for more than 10% of annuity deposits collected | NMOs | 2 | 2 | 1 |
Customer Concentration Risk | National Marketing Organization, Greater than 10%, NMO 1 | |||
Product Information [Line Items] | |||
National marketing organizations, percent of annuity deposits collected individually | 20.00% | 14.00% | 15.00% |
Customer Concentration Risk | National Marketing Organization, Greater than 10%, NMO 2 | |||
Product Information [Line Items] | |||
National marketing organizations, percent of annuity deposits collected individually | 14.00% | 10.00% |
Fair Values of Financial Inst_3
Fair Values of Financial Instruments (Narrative) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)Basis_Points | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Level 1 to Level 2 transfers, amount | $ 0 | $ 0 | |
Liabilities, Level 1 to Level 2 transfers, amount | 0 | 0 | |
Assets, Level 2 to Level 1 transfers, amount | 0 | 0 | |
Liabilities, Level 2 to Level 1 transfers, amount | 0 | 0 | |
Assets, transfers into Level 3, amount | 0 | 0 | $ 0 |
Liabilities, transfers into Level 3, amount | 0 | 0 | 0 |
Assets, transfers out of Level 3, amount | 0 | 0 | 0 |
Liabilities, transfers out of Level 3, amount | $ 0 | $ 0 | $ 0 |
Maximum | Measurement Input, Discount Rate | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value, sensitivity, discount rate adjustment (basis points) | Basis_Points | 100 | ||
Fixed index annuities embedded derivative, adjustment due to change in discount rate | $ (504,500) | ||
Deferred policy acquisition costs and deferred sales inducements, combined balance, adjustment due to change in discount rate | $ (423,500) | ||
Minimum | Measurement Input, Discount Rate | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value, sensitivity, discount rate adjustment (basis points) | Basis_Points | (100) | ||
Fixed index annuities embedded derivative, adjustment due to change in discount rate | $ 559,900 | ||
Deferred policy acquisition costs and deferred sales inducements, combined balance, adjustment due to change in discount rate | $ 291,800 |
Fair Values of Financial Inst_4
Fair Values of Financial Instruments (Carrying Amounts and Fair Values of Financial Instruments) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||
Available for sale securities, fair value | $ 45,923,727 | $ 45,372,989 |
Held for investment | 0 | 76,460 |
Derivative instruments | 205,149 | 1,568,380 |
Other investments | 355,531 | 616,764 |
Coinsurance deposits | 4,954,068 | 4,858,289 |
Liabilities | ||
Policy benefit reserves | 57,606,009 | 56,142,673 |
Carrying Amount | ||
Assets | ||
Available for sale securities, fair value | 45,923,727 | 45,372,989 |
Held for investment | 0 | 77,041 |
Mortgage loans on real estate | 2,943,091 | 2,665,531 |
Derivative instruments | 205,149 | 1,568,380 |
Other investments | 355,531 | 616,764 |
Cash and cash equivalents | 344,396 | 1,434,045 |
Coinsurance deposits | 4,954,068 | 4,858,289 |
Counterparty collateral | 33,101 | 186,108 |
Liabilities | ||
Policy benefit reserves | 57,249,510 | 55,786,011 |
Single premium immediate annuity (SPIA) benefit reserves | 270,406 | 282,563 |
Notes payable | 494,591 | 494,093 |
Subordinated debentures | 242,982 | 242,565 |
Amounts due under repurchase agreements | 109,298 | 0 |
Carrying Amount | Interest Rate Caps | ||
Assets | ||
Interest rate derivative assets | 597 | 415 |
Carrying Amount | Interest Rate Swap | ||
Assets | ||
Interest rate derivative assets | 354 | 0 |
Liabilities | ||
Interest rate derivative liabilities | 0 | 789 |
Fair Value | ||
Assets | ||
Available for sale securities, fair value | 45,923,727 | 45,372,989 |
Held for investment | 0 | 76,460 |
Mortgage loans on real estate | 2,920,612 | 2,670,037 |
Derivative instruments | 205,149 | 1,568,380 |
Other investments | 348,970 | 605,894 |
Cash and cash equivalents | 344,396 | 1,434,045 |
Coinsurance deposits | 4,553,790 | 4,347,990 |
Counterparty collateral | 33,101 | 186,108 |
Liabilities | ||
Policy benefit reserves | 49,180,143 | 46,344,931 |
Single premium immediate annuity (SPIA) benefit reserves | 279,077 | 292,153 |
Notes payable | 489,985 | 521,800 |
Subordinated debentures | 215,514 | 244,117 |
Amounts due under repurchase agreements | 109,298 | 0 |
Fair Value | Interest Rate Caps | ||
Assets | ||
Interest rate derivative assets | 597 | 415 |
Fair Value | Interest Rate Swap | ||
Assets | ||
Interest rate derivative assets | 354 | 0 |
Liabilities | ||
Interest rate derivative liabilities | $ 0 | $ 789 |
Fair Values of Financial Inst_5
Fair Values of Financial Instruments (Assets and Liabilities Measured on a Recurring Basis by Fair Value Hierarchy) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||
Derivative instruments | $ 205,149 | $ 1,568,380 |
Fair Value, Measurements, Recurring | ||
Assets | ||
Derivative instruments | 205,149 | 1,568,380 |
Cash and cash equivalents | 344,396 | 1,434,045 |
Counterparty collateral | 33,101 | 186,108 |
Assets | 46,514,761 | 48,854,366 |
Liabilities | ||
Fixed index annuities - embedded derivatives | 8,165,405 | 8,790,427 |
Liabilities | 8,791,216 | |
Fair Value, Measurements, Recurring | Interest Rate Caps | ||
Assets | ||
Interest rate derivative assets | 597 | 415 |
Fair Value, Measurements, Recurring | Interest Rate Swap | ||
Assets | ||
Interest rate derivative assets | 354 | |
Liabilities | ||
Interest rate derivative liabilities | 789 | |
Fair Value, Measurements, Recurring | United States Government Full Faith and Credit | ||
Assets | ||
Available for sale securities | 11,652 | 11,876 |
Fair Value, Measurements, Recurring | United States Government Sponsored Agencies | ||
Assets | ||
Available for sale securities | 1,138,529 | 1,305,017 |
Fair Value, Measurements, Recurring | United States Municipalities, States and Territories | ||
Assets | ||
Available for sale securities | 4,126,267 | 4,166,812 |
Fair Value, Measurements, Recurring | Foreign Government Obligations | ||
Assets | ||
Available for sale securities | 230,274 | 239,360 |
Fair Value, Measurements, Recurring | Corporate Securities | ||
Assets | ||
Available for sale securities | 28,371,514 | 29,878,971 |
Fair Value, Measurements, Recurring | Residential Mortgage Backed Securities | ||
Assets | ||
Available for sale securities | 1,202,159 | 1,105,567 |
Fair Value, Measurements, Recurring | Commercial Mortgage Backed Securities | ||
Assets | ||
Available for sale securities | 5,379,003 | 5,544,850 |
Fair Value, Measurements, Recurring | Other Asset Backed Securities | ||
Assets | ||
Available for sale securities | 5,464,329 | 3,120,536 |
Fair Value, Measurements, Recurring | Equity Securities | ||
Assets | ||
Available for sale securities | 7,437 | 292,429 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | ||
Assets | ||
Derivative instruments | 0 | 0 |
Cash and cash equivalents | 344,396 | 1,434,045 |
Counterparty collateral | 0 | 0 |
Assets | 350,303 | 1,724,690 |
Liabilities | ||
Fixed index annuities - embedded derivatives | 0 | 0 |
Liabilities | 0 | |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | Interest Rate Caps | ||
Assets | ||
Interest rate derivative assets | 0 | 0 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | Interest Rate Swap | ||
Assets | ||
Interest rate derivative assets | 0 | |
Liabilities | ||
Interest rate derivative liabilities | 0 | |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | United States Government Full Faith and Credit | ||
Assets | ||
Available for sale securities | 5,900 | 5,640 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | United States Government Sponsored Agencies | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | United States Municipalities, States and Territories | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | Foreign Government Obligations | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | Corporate Securities | ||
Assets | ||
Available for sale securities | 7 | 5 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | Residential Mortgage Backed Securities | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | Commercial Mortgage Backed Securities | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | Other Asset Backed Securities | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets (Level 1) | Equity Securities | ||
Assets | ||
Available for sale securities | 0 | 285,000 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | ||
Assets | ||
Derivative instruments | 205,149 | 1,568,380 |
Cash and cash equivalents | 0 | 0 |
Counterparty collateral | 33,101 | 186,108 |
Assets | 46,164,458 | 47,129,676 |
Liabilities | ||
Fixed index annuities - embedded derivatives | 0 | 0 |
Liabilities | 789 | |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Interest Rate Caps | ||
Assets | ||
Interest rate derivative assets | 597 | 415 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Interest Rate Swap | ||
Assets | ||
Interest rate derivative assets | 354 | |
Liabilities | ||
Interest rate derivative liabilities | 789 | |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | United States Government Full Faith and Credit | ||
Assets | ||
Available for sale securities | 5,752 | 6,236 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | United States Government Sponsored Agencies | ||
Assets | ||
Available for sale securities | 1,138,529 | 1,305,017 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | United States Municipalities, States and Territories | ||
Assets | ||
Available for sale securities | 4,126,267 | 4,166,812 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Foreign Government Obligations | ||
Assets | ||
Available for sale securities | 230,274 | 239,360 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Corporate Securities | ||
Assets | ||
Available for sale securities | 28,371,507 | 29,878,966 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Residential Mortgage Backed Securities | ||
Assets | ||
Available for sale securities | 1,202,159 | 1,105,567 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Commercial Mortgage Backed Securities | ||
Assets | ||
Available for sale securities | 5,379,003 | 5,544,850 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Other Asset Backed Securities | ||
Assets | ||
Available for sale securities | 5,464,329 | 3,120,536 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Equity Securities | ||
Assets | ||
Available for sale securities | 7,437 | 7,429 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | ||
Assets | ||
Derivative instruments | 0 | 0 |
Cash and cash equivalents | 0 | 0 |
Counterparty collateral | 0 | 0 |
Assets | 0 | 0 |
Liabilities | ||
Fixed index annuities - embedded derivatives | 8,165,405 | 8,790,427 |
Liabilities | 8,790,427 | |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Interest Rate Caps | ||
Assets | ||
Interest rate derivative assets | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Interest Rate Swap | ||
Assets | ||
Interest rate derivative assets | 0 | |
Liabilities | ||
Interest rate derivative liabilities | 0 | |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | United States Government Full Faith and Credit | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | United States Government Sponsored Agencies | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | United States Municipalities, States and Territories | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Foreign Government Obligations | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Corporate Securities | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Residential Mortgage Backed Securities | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Commercial Mortgage Backed Securities | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Other Asset Backed Securities | ||
Assets | ||
Available for sale securities | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Equity Securities | ||
Assets | ||
Available for sale securities | $ 0 | $ 0 |
Fair Values of Financial Inst_6
Fair Values of Financial Instruments (Assumptions Used in Estimating Fair Value) (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Expected cost of annual call options | 3.10% | 3.10% |
Mortality rate assumption | 65.00% | |
Fixed Index Annuities | Minimum | Contract Duration (Years), Group 1 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Contract duration (years) | 1 year | 1 year |
Fixed Index Annuities | Minimum | Contract Duration (Years), Group 2 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Contract duration (years) | 6 years | 6 years |
Fixed Index Annuities | Minimum | Contract Duration (Years), Group 3 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Contract duration (years) | 11 years | 11 years |
Fixed Index Annuities | Minimum | Contract Duration (Years), Group 4 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Contract duration (years) | 16 years | 16 years |
Fixed Index Annuities | Minimum | Contract Duration (Years), Group 5 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Contract duration (years) | 20 years | 20 years |
Fixed Index Annuities | Maximum | Contract Duration (Years), Group 1 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Contract duration (years) | 5 years | 5 years |
Fixed Index Annuities | Maximum | Contract Duration (Years), Group 2 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Contract duration (years) | 10 years | 10 years |
Fixed Index Annuities | Maximum | Contract Duration (Years), Group 3 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Contract duration (years) | 15 years | 15 years |
Fixed Index Annuities | Maximum | Contract Duration (Years), Group 4 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Contract duration (years) | 20 years | 20 years |
Fixed Index Annuities | Average | Contract Duration (Years), Group 1 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Average lapse rates | 2.05% | 1.83% |
Average partial withdrawal rates | 3.33% | 3.32% |
Fixed Index Annuities | Average | Contract Duration (Years), Group 2 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Average lapse rates | 7.28% | 7.01% |
Average partial withdrawal rates | 3.33% | 3.32% |
Fixed Index Annuities | Average | Contract Duration (Years), Group 3 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Average lapse rates | 11.35% | 11.31% |
Average partial withdrawal rates | 3.35% | 3.34% |
Fixed Index Annuities | Average | Contract Duration (Years), Group 4 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Average lapse rates | 11.90% | 11.96% |
Average partial withdrawal rates | 3.22% | 3.20% |
Fixed Index Annuities | Average | Contract Duration (Years), Group 5 | ||
Long-Duration Contracts, Assumptions by Product and Guarantee [Line Items] | ||
Average lapse rates | 11.57% | 11.62% |
Average partial withdrawal rates | 3.22% | 3.20% |
Fair Values of Financial Inst_7
Fair Values of Financial Instruments (Reconciliation of Beginning and Ending Balances of Level 3 Liabilities) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Beginning balance | $ 8,790,427 | $ 6,563,288 |
Premiums less benefits | 1,542,606 | 2,052,985 |
Change in fair value, net | (2,167,628) | 174,154 |
Ending balance | 8,165,405 | 8,790,427 |
Coinsurance ceded, fixed index annuities embedded derivatives | 4,954,068 | 4,858,289 |
Fixed Index Annuities - Embedded Derivatives | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Coinsurance ceded, fixed index annuities embedded derivatives | $ 538,800 | $ 539,700 |
Investments (Narrative) (Detail
Investments (Narrative) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)Securities | Dec. 31, 2017USD ($)Securities | Dec. 31, 2016USD ($) | |
Investments [Abstract] | |||
Percentage of fixed maturity portfolio rated investment grade based on NAIC designations | 97.00% | 97.00% | |
Number of securities in unrealized loss position | Securities | 2,715 | 955 | |
Percentage of unrealized losses on fixed maturity securities where securities are rated investment grade | 87.00% | 83.00% | |
Proceeds from sales of available for sale securities | $ 2,500,000 | $ 700,000 | $ 1,000,000 |
Principal repayments, calls and tenders of available for sale securities | 1,400,000 | 1,200,000 | $ 1,700,000 |
Assets held by insurance regulators | 49,200,000 | 47,500,000 | |
Fair value, concentration of risk, investments | $ 0 | $ 0 |
Investments (Schedule of Fixed
Investments (Schedule of Fixed Maturity Securities) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Debt Securities, Available-for-sale [Line Items] | ||
Available for sale securities, amortized cost | $ 46,131,190 | $ 43,116,759 |
Available for sale securities, gross unrealized gains | 1,143,624 | 2,525,131 |
Available for sale securities, gross unrealized losses | (1,351,087) | (268,901) |
Available for sale securities, fair value | 45,923,727 | 45,372,989 |
Held for investment, amortized cost | 0 | 77,041 |
Held for investment, fair value | 0 | 76,460 |
United States Government Full Faith and Credit | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available for sale securities, amortized cost | 11,872 | 11,861 |
Available for sale securities, gross unrealized gains | 102 | 162 |
Available for sale securities, gross unrealized losses | (322) | (147) |
Available for sale securities, fair value | 11,652 | 11,876 |
United States Government Sponsored Agencies | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available for sale securities, amortized cost | 1,208,468 | 1,308,290 |
Available for sale securities, gross unrealized gains | 13,095 | 28,457 |
Available for sale securities, gross unrealized losses | (83,034) | (31,730) |
Available for sale securities, fair value | 1,138,529 | 1,305,017 |
United States Municipalities, States and Territories | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available for sale securities, amortized cost | 3,880,703 | 3,804,360 |
Available for sale securities, gross unrealized gains | 261,222 | 366,048 |
Available for sale securities, gross unrealized losses | (15,658) | (3,596) |
Available for sale securities, fair value | 4,126,267 | 4,166,812 |
Foreign Government Obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available for sale securities, amortized cost | 226,860 | 228,214 |
Available for sale securities, gross unrealized gains | 7,573 | 13,171 |
Available for sale securities, gross unrealized losses | (4,159) | (2,025) |
Available for sale securities, fair value | 230,274 | 239,360 |
Corporate Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available for sale securities, amortized cost | 28,483,138 | 28,127,653 |
Available for sale securities, gross unrealized gains | 727,105 | 1,897,005 |
Available for sale securities, gross unrealized losses | (838,729) | (145,687) |
Available for sale securities, fair value | 28,371,514 | 29,878,971 |
Held for investment, amortized cost | 77,041 | |
Held for investment, gross unrealized gains | 0 | |
Held for investment, gross unrealized losses | (581) | |
Held for investment, fair value | 76,460 | |
Residential Mortgage Backed Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available for sale securities, amortized cost | 1,134,623 | 1,028,484 |
Available for sale securities, gross unrealized gains | 71,661 | 79,554 |
Available for sale securities, gross unrealized losses | (4,125) | (2,471) |
Available for sale securities, fair value | 1,202,159 | 1,105,567 |
Commercial Mortgage Backed Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available for sale securities, amortized cost | 5,492,271 | 5,531,922 |
Available for sale securities, gross unrealized gains | 21,558 | 82,768 |
Available for sale securities, gross unrealized losses | (134,826) | (69,840) |
Available for sale securities, fair value | 5,379,003 | 5,544,850 |
Other Asset Backed Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available for sale securities, amortized cost | 5,693,255 | 3,075,975 |
Available for sale securities, gross unrealized gains | 41,308 | 57,966 |
Available for sale securities, gross unrealized losses | (270,234) | (13,405) |
Available for sale securities, fair value | $ 5,464,329 | 3,120,536 |
Equity Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available for sale equity securities, amortized cost | 292,429 | |
Available for sale equity securities, gross unrealized gains | 0 | |
Available for sale equity securities, gross unrealized losses | 0 | |
Available for sale equity securities, fair value | $ 292,429 |
Investments (Fixed Maturity Sec
Investments (Fixed Maturity Securities by Contractual Maturity) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Available-for-sale Securities, Debt Maturities, Amortized Cost Basis [Abstract] | ||
Available for sale, due in one year or less, amortized cost | $ 365,686 | |
Available for sale, due after one year through five years, amortized cost | 5,426,450 | |
Available for sale, due after five years through ten years, amortized cost | 9,918,504 | |
Available for sale, due after ten years through twenty years, amortized cost | 9,565,686 | |
Available for sale, due after twenty years, amortized cost | 8,534,715 | |
Available for sale, securities with a single maturity date, amortized cost | 33,811,041 | |
Available for sale securities, amortized cost | 46,131,190 | $ 43,116,759 |
Available-for-sale Securities, Debt Maturities, Fair Value [Abstract] | ||
Available for sale, due in one year or less, fair value | 368,836 | |
Available for sale, due after one year through five years, fair value | 5,416,871 | |
Available for sale, due after five years through ten years, fair value | 9,768,751 | |
Available for sale, due after ten years through twenty years, fair value | 9,895,985 | |
Available for sale, due after twenty years, fair value | 8,427,793 | |
Available for sale, securities with a single maturity date, fair value | 33,878,236 | |
Available for sale securities, fair value | 45,923,727 | 45,372,989 |
Residential Mortgage Backed Securities | ||
Available-for-sale Securities, Debt Maturities, Amortized Cost Basis [Abstract] | ||
Available for sale, securities without a single maturity date, amortized cost | 1,134,623 | |
Available for sale securities, amortized cost | 1,134,623 | 1,028,484 |
Available-for-sale Securities, Debt Maturities, Fair Value [Abstract] | ||
Available for sale, securities without a single maturity date, fair value | 1,202,159 | |
Available for sale securities, fair value | 1,202,159 | 1,105,567 |
Commercial Mortgage Backed Securities | ||
Available-for-sale Securities, Debt Maturities, Amortized Cost Basis [Abstract] | ||
Available for sale, securities without a single maturity date, amortized cost | 5,492,271 | |
Available for sale securities, amortized cost | 5,492,271 | 5,531,922 |
Available-for-sale Securities, Debt Maturities, Fair Value [Abstract] | ||
Available for sale, securities without a single maturity date, fair value | 5,379,003 | |
Available for sale securities, fair value | 5,379,003 | 5,544,850 |
Other Asset Backed Securities | ||
Available-for-sale Securities, Debt Maturities, Amortized Cost Basis [Abstract] | ||
Available for sale, securities without a single maturity date, amortized cost | 5,693,255 | |
Available for sale securities, amortized cost | 5,693,255 | 3,075,975 |
Available-for-sale Securities, Debt Maturities, Fair Value [Abstract] | ||
Available for sale, securities without a single maturity date, fair value | 5,464,329 | |
Available for sale securities, fair value | $ 5,464,329 | $ 3,120,536 |
Investments (Net Unrealized Gai
Investments (Net Unrealized Gains (Losses) on Available for Sale Fixed Maturity Securities Reported as a Seperate Component of Stockholders' Equity) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Net unrealized gains (losses) on available for sale fixed maturity securities | $ (207,463) | $ 2,256,230 | |
Adjustments for assumed changes in amortization of deferred policy acquisition costs and deferred sales inducements | 112,571 | (1,206,078) | |
Deferred income tax valuation allowance reversal | 22,534 | 22,534 | |
Deferred income tax benefit (expense) (a) | [1] | 19,926 | (348,087) |
Net unrealized gains (losses) reported as accumulated other comprehensive income (loss) | (52,432) | 724,599 | |
Accounting Standards Update 2018-02 | |||
New accounting pronouncement, effect of adoption, quantification | $ 128,000 | $ 128,000 | |
[1] | December 31, 2017 includes $128 million related to the impact of Tax Reform that was reclassified between accumulated other comprehensive income (loss) and retained earnings within our consolidated balance sheet during the first quarter of 2018. For more information regarding the reclassification, see Note 1. |
Investments (Credit Quality of
Investments (Credit Quality of Fixed Maturity Security Portfolio by NAIC Designation) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Investment Holdings [Line Items] | ||
Available for sale securities, amortized cost | $ 46,131,190 | $ 43,116,759 |
Available for sale securities, fair value | 45,923,727 | 45,372,989 |
Available for sale securities and held for investment, amortized cost | 43,193,800 | |
Available for sale securities and held for investment, fair value | 45,449,449 | |
NAIC, Class 1 Designation | ||
Investment Holdings [Line Items] | ||
Available for sale securities, amortized cost | 26,588,352 | |
Available for sale securities, fair value | 26,921,843 | |
Available for sale securities and held for investment, amortized cost | 26,669,427 | |
Available for sale securities and held for investment, fair value | 28,274,379 | |
NAIC, Class 2 Designation | ||
Investment Holdings [Line Items] | ||
Available for sale securities, amortized cost | 17,901,161 | |
Available for sale securities, fair value | 17,528,072 | |
Available for sale securities and held for investment, amortized cost | 15,198,551 | |
Available for sale securities and held for investment, fair value | 15,869,219 | |
NAIC, Class 3 Designation | ||
Investment Holdings [Line Items] | ||
Available for sale securities, amortized cost | 1,396,650 | |
Available for sale securities, fair value | 1,269,242 | |
Available for sale securities and held for investment, amortized cost | 1,161,737 | |
Available for sale securities and held for investment, fair value | 1,157,420 | |
NAIC, Class 4 Designation | ||
Investment Holdings [Line Items] | ||
Available for sale securities, amortized cost | 173,987 | |
Available for sale securities, fair value | 137,991 | |
Available for sale securities and held for investment, amortized cost | 134,838 | |
Available for sale securities and held for investment, fair value | 117,542 | |
NAIC, Class 5 Designation | ||
Investment Holdings [Line Items] | ||
Available for sale securities, amortized cost | 23,836 | |
Available for sale securities, fair value | 19,453 | |
Available for sale securities and held for investment, amortized cost | 17,015 | |
Available for sale securities and held for investment, fair value | 20,927 | |
NAIC, Class 6 Designation | ||
Investment Holdings [Line Items] | ||
Available for sale securities, amortized cost | 47,204 | |
Available for sale securities, fair value | $ 47,126 | |
Available for sale securities and held for investment, amortized cost | 12,232 | |
Available for sale securities and held for investment, fair value | $ 9,962 |
Investments (Gross Unrealized L
Investments (Gross Unrealized Losses on Investments, By Category and Length of Time) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | $ 19,341,518 | $ 3,999,294 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (803,628) | (47,884) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 6,619,197 | 4,815,325 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (547,459) | (221,017) |
Available for sale, continuous unrealized loss position, total, fair value | 25,960,715 | 8,814,619 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (1,351,087) | (268,901) |
United States Government Full Faith and Credit | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 543 | 1,565 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (3) | (10) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 7,785 | 6,731 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (319) | (137) |
Available for sale, continuous unrealized loss position, total, fair value | 8,328 | 8,296 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (322) | (147) |
United States Government Sponsored Agencies | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 30,089 | 44,794 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (949) | (180) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 953,421 | 958,965 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (82,085) | (31,550) |
Available for sale, continuous unrealized loss position, total, fair value | 983,510 | 1,003,759 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (83,034) | (31,730) |
United States Municipalities, States and Territories | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 340,103 | 44,736 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (6,816) | (128) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 162,997 | 128,499 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (8,842) | (3,468) |
Available for sale, continuous unrealized loss position, total, fair value | 503,100 | 173,235 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (15,658) | (3,596) |
Foreign Government Obligations | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 98,511 | 49,663 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (1,748) | (337) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 11,859 | 12,625 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (2,411) | (1,688) |
Available for sale, continuous unrealized loss position, total, fair value | 110,370 | 62,288 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (4,159) | (2,025) |
Corporate Securities | Finance, Insurance and Real Estate | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 2,501,640 | 456,244 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (87,220) | (5,135) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 884,870 | 600,655 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (77,507) | (28,043) |
Available for sale, continuous unrealized loss position, total, fair value | 3,386,510 | 1,056,899 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (164,727) | (33,178) |
Corporate Securities | Manufacturing, Construction and Mining | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 2,045,859 | 222,985 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (84,972) | (3,475) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 349,738 | 231,196 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (34,635) | (10,849) |
Available for sale, continuous unrealized loss position, total, fair value | 2,395,597 | 454,181 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (119,607) | (14,324) |
Corporate Securities | Utilities and Related Sectors | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 2,313,271 | 395,183 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (82,119) | (4,099) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 591,482 | 249,416 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (45,838) | (8,901) |
Available for sale, continuous unrealized loss position, total, fair value | 2,904,753 | 644,599 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (127,957) | (13,000) |
Corporate Securities | Wholesale/Retail Trade | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 1,032,603 | 152,941 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (51,228) | (1,249) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 198,805 | 178,635 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (26,326) | (11,371) |
Available for sale, continuous unrealized loss position, total, fair value | 1,231,408 | 331,576 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (77,554) | (12,620) |
Corporate Securities | Services, Media and Other | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 4,618,477 | 729,124 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (196,520) | (19,000) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 1,072,722 | 891,654 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (152,364) | (53,565) |
Available for sale, continuous unrealized loss position, total, fair value | 5,691,199 | 1,620,778 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (348,884) | (72,565) |
Corporate Securities | Insurance | ||
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position [Abstract] | ||
Held for investment, continuous unrealized loss position, less than 12 months, fair value | 0 | |
Held for investment, continuous unrealized loss position, less than 12 months, unrealized losses | 0 | |
Held for investment, continuous unrealized loss position, 12 months or more, fair value | 76,460 | |
Held for investment, continuous unrealized loss position, 12 months or more, unrealized losses | (581) | |
Held for investment, continuous unrealized loss position, total, fair value | 76,460 | |
Held for investment, continuous unrealized loss position, total, unrealized losses | (581) | |
Residential Mortgage Backed Securities | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 145,613 | 39,771 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (2,638) | (387) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 22,689 | 32,917 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (1,487) | (2,084) |
Available for sale, continuous unrealized loss position, total, fair value | 168,302 | 72,688 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (4,125) | (2,471) |
Commercial Mortgage Backed Securities | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 2,141,560 | 1,096,757 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (37,150) | (10,385) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 2,090,835 | 1,306,437 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (97,676) | (59,455) |
Available for sale, continuous unrealized loss position, total, fair value | 4,232,395 | 2,403,194 |
Available for sale, continuous unrealized loss position, total, unrealized losses | (134,826) | (69,840) |
Other Asset Backed Securities | ||
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract] | ||
Available for sale, continuous unrealized loss position, less than 12 months, fair value | 4,073,249 | 765,531 |
Available for sale, continuous unrealized loss position, less than 12 months, unrealized losses | (252,265) | (3,499) |
Available for sale, continuous unrealized loss position, 12 months or more, fair value | 271,994 | 217,595 |
Available for sale, continuous unrealized loss position, 12 months or more, unrealized losses | (17,969) | (9,906) |
Available for sale, continuous unrealized loss position, total, fair value | 4,345,243 | 983,126 |
Available for sale, continuous unrealized loss position, total, unrealized losses | $ (270,234) | $ (13,405) |
Investments (Changes in Net Unr
Investments (Changes in Net Unrealized Gains/Losses on Investments) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Investment Holdings [Line Items] | |||
Fixed maturity securities held for investment carried at amortized cost | $ 581 | $ 7,478 | $ 3,186 |
Investments carried at fair value | (2,463,693) | 1,149,212 | 508,576 |
Adjustment for effect on other balance sheet accounts: | |||
Deferred policy acquisition costs and deferred sales inducements | 1,318,649 | (587,417) | (295,802) |
Deferred income tax asset/liability | 240,459 | (177,162) | (74,471) |
Total adjustment for effect on other balance sheet accounts | 1,559,108 | (764,579) | (370,273) |
Change in net unrealized gains/losses on investments carried at fair value | (904,585) | 384,633 | 138,303 |
Fixed Maturity Securities | |||
Investment Holdings [Line Items] | |||
Investments carried at fair value | (2,463,693) | 1,149,691 | 508,410 |
Equity Securities | |||
Investment Holdings [Line Items] | |||
Investments carried at fair value | $ 0 | $ (479) | $ 166 |
Investments (Components of Net
Investments (Components of Net Investment Income) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net Investment Income [Line Items] | |||||||||||
Investment income, gross | $ 2,167,461 | $ 2,006,621 | $ 1,861,392 | ||||||||
Less investment expenses | (19,649) | (14,624) | (11,520) | ||||||||
Net investment income | $ 554,355 | $ 549,391 | $ 533,282 | $ 510,784 | $ 512,709 | $ 500,202 | $ 493,489 | $ 485,597 | 2,147,812 | 1,991,997 | 1,849,872 |
Fixed Maturity Securities | |||||||||||
Net Investment Income [Line Items] | |||||||||||
Investment income, gross | 2,027,599 | 1,876,542 | 1,729,176 | ||||||||
Equity Securities | |||||||||||
Net Investment Income [Line Items] | |||||||||||
Investment income, gross | 4,735 | 764 | 531 | ||||||||
Mortgage Loans on Real Estate | |||||||||||
Net Investment Income [Line Items] | |||||||||||
Investment income, gross | 131,259 | 122,680 | 122,985 | ||||||||
Cash and Cash Equivalents | |||||||||||
Net Investment Income [Line Items] | |||||||||||
Investment income, gross | 2,320 | 2,562 | 3,201 | ||||||||
Other | |||||||||||
Net Investment Income [Line Items] | |||||||||||
Investment income, gross | $ 1,548 | $ 4,073 | $ 5,499 |
Investments (Net Realized Gains
Investments (Net Realized Gains (Losses) on Invesments) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Gain (Loss) on Securities [Line Items] | |||||||||||
Net realized gains (losses) on investments, excluding other than temporary impairment (OTTI) losses | $ 3,097 | $ (2,196) | $ (38,381) | $ 302 | $ 2,719 | $ 1,579 | $ 3,873 | $ 2,338 | $ (37,178) | $ 10,509 | $ 11,524 |
Fixed Maturity Securities | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Gross realized gains | 12,245 | 18,254 | 14,132 | ||||||||
Gross realized losses | (47,974) | (9,058) | (4,036) | ||||||||
Available for sale fixed maturity securities: Realized gains (losses), excluding other than temporary impairment | (35,729) | 9,196 | 10,096 | ||||||||
Equity Securities | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Gross realized gains | 0 | 348 | 0 | ||||||||
Other Investments | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Gain on sale of real estate | 0 | 56 | 884 | ||||||||
Loss on sale of real estate | 0 | 0 | (93) | ||||||||
Other investments: Gain (loss) on other investments | 0 | 56 | 791 | ||||||||
Mortgage Loans on Real Estate | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Decrease (increase) in allowance for credit losses | (3,165) | 278 | (4,846) | ||||||||
Recovery of specific allowance | 1,592 | 631 | 5,483 | ||||||||
Gain on sale of mortgage loans | 124 | 0 | 0 | ||||||||
Change in allowance for credit losses and recoveries | $ (1,449) | $ 909 | $ 637 |
Investments (Non-Income Produci
Investments (Non-Income Producing Investments) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fixed Maturity Securities | ||
Investment Holdings [Line Items] | ||
Non-income producing investments | $ 6,717 | $ 8,680 |
Investments (Other Than Tempora
Investments (Other Than Temporary Impairment by Asset Type) (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2018USD ($)Securities | Dec. 31, 2017USD ($)Securities | Dec. 31, 2016USD ($)Securities | |
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 35 | 10 | 22 | ||||||||
Total OTTI losses | $ (35,005) | $ (2,758) | $ (21,349) | ||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | (1,651) | (1,872) | (1,330) | ||||||||
Net OTTI losses recognized in operations | $ (18,980) | $ (14,373) | $ (2,396) | $ (907) | $ (3,076) | $ (464) | $ (949) | $ (141) | $ (36,656) | $ (4,630) | $ (22,679) |
Corporate Securities | Capital Goods | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 1 | ||||||||||
Total OTTI losses | $ (719) | ||||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | 0 | ||||||||||
Net OTTI losses recognized in operations | $ (719) | ||||||||||
Corporate Securities | Consumer Discretionary | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 8 | ||||||||||
Total OTTI losses | $ (9,533) | ||||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | 0 | ||||||||||
Net OTTI losses recognized in operations | $ (9,533) | ||||||||||
Corporate Securities | Energy | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 4 | 2 | |||||||||
Total OTTI losses | $ (4,793) | $ (642) | |||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | 0 | 0 | |||||||||
Net OTTI losses recognized in operations | $ (4,793) | $ (642) | |||||||||
Corporate Securities | Financials | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 5 | ||||||||||
Total OTTI losses | $ (3,495) | ||||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | 0 | ||||||||||
Net OTTI losses recognized in operations | $ (3,495) | ||||||||||
Corporate Securities | Information Technology | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 1 | ||||||||||
Total OTTI losses | $ (550) | ||||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | 0 | ||||||||||
Net OTTI losses recognized in operations | $ (550) | ||||||||||
Corporate Securities | Industrials | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 1 | 1 | |||||||||
Total OTTI losses | $ (2,299) | $ (2,485) | |||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | 0 | 0 | |||||||||
Net OTTI losses recognized in operations | $ (2,299) | $ (2,485) | |||||||||
Corporate Securities | Materials | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 1 | ||||||||||
Total OTTI losses | $ (4,554) | ||||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | 1,575 | ||||||||||
Net OTTI losses recognized in operations | $ (2,979) | ||||||||||
Corporate Securities | Telecommunications | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 2 | 1 | |||||||||
Total OTTI losses | $ (249) | $ (4,462) | |||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | 0 | 562 | |||||||||
Net OTTI losses recognized in operations | $ (249) | $ (3,900) | |||||||||
Corporate Securities | Transportation | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 1 | ||||||||||
Total OTTI losses | $ (178) | ||||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | 0 | ||||||||||
Net OTTI losses recognized in operations | $ (178) | ||||||||||
Corporate Securities | Utilities | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 2 | 2 | |||||||||
Total OTTI losses | $ (5,518) | $ (6,961) | |||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | 0 | 798 | |||||||||
Net OTTI losses recognized in operations | $ (5,518) | $ (6,163) | |||||||||
Residential Mortgage Backed Securities | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 3 | 8 | 9 | ||||||||
Total OTTI losses | $ (63) | $ (273) | $ 0 | ||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | (295) | (1,585) | (783) | ||||||||
Net OTTI losses recognized in operations | $ (358) | $ (1,858) | $ (783) | ||||||||
Commercial Mortgage Backed Securities | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 5 | 5 | |||||||||
Total OTTI losses | $ (4,859) | $ (1,540) | |||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | 0 | 0 | |||||||||
Net OTTI losses recognized in operations | $ (4,859) | $ (1,540) | |||||||||
Other Asset Backed Securities | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Other than temporary impairment, number of securities | Securities | 2 | 1 | 2 | ||||||||
Total OTTI losses | $ (2,749) | $ 0 | $ (3,190) | ||||||||
Portion of OTTI losses recognized in (from) other comprehensive income | (1,356) | (287) | (3,482) | ||||||||
Net OTTI losses recognized in operations | $ (4,105) | $ (287) | $ (6,672) |
Investments (Other Than Tempo_2
Investments (Other Than Temporary Impairment, Credit Losses Recognized in Earnings) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items] | ||
Cumulative credit loss at beginning of year | $ (157,066) | $ (166,375) |
Additions for the amount related to credit losses for which OTTI has not previously been recognized | (35,005) | (2,758) |
Additional credit losses on securities for which OTTI has previously been recognized | (1,651) | (1,872) |
Accumulated losses on securities that were disposed of during the period | 18,324 | 13,939 |
Cumulative credit loss at end of year | $ (175,398) | $ (157,066) |
Investments (Schedule of Other
Investments (Schedule of Other Than Temporary Impairment Losses, Investments) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Investment Holdings [Line Items] | ||
Amortized cost | $ 352,207 | $ 315,164 |
OTTI recognized in other comprehensive income (loss) | (171,546) | (173,974) |
Change in fair value since OTTI was recognized | 205,712 | 210,484 |
Fair value | 386,373 | 351,674 |
Corporate Securities | ||
Investment Holdings [Line Items] | ||
Amortized cost | 69,580 | 13,015 |
OTTI recognized in other comprehensive income (loss) | (3,700) | (4,263) |
Change in fair value since OTTI was recognized | 6,195 | 10,739 |
Fair value | 72,075 | 19,491 |
Residential Mortgage Backed Securities | ||
Investment Holdings [Line Items] | ||
Amortized cost | 245,691 | 297,582 |
OTTI recognized in other comprehensive income (loss) | (167,846) | (168,355) |
Change in fair value since OTTI was recognized | 199,191 | 201,620 |
Fair value | 277,036 | 330,847 |
Commercial Mortgage Backed Securities | ||
Investment Holdings [Line Items] | ||
Amortized cost | 35,244 | |
OTTI recognized in other comprehensive income (loss) | 0 | |
Change in fair value since OTTI was recognized | 0 | |
Fair value | 35,244 | |
Other Asset Backed Securities | ||
Investment Holdings [Line Items] | ||
Amortized cost | 1,692 | 4,567 |
OTTI recognized in other comprehensive income (loss) | 0 | (1,356) |
Change in fair value since OTTI was recognized | 326 | (1,875) |
Fair value | $ 2,018 | $ 1,336 |
Mortgage Loans on Real Estate_2
Mortgage Loans on Real Estate (Narrative) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)portfolio_segment | Dec. 31, 2016USD ($)properties | Dec. 31, 2017USD ($) | |
Receivables [Abstract] | |||
Number of portfolio segments that make up financing receivables | portfolio_segment | 1 | ||
Real estate owned | $ 0 | $ 0 | $ 0 |
Real estate owned, number of properties | properties | 1 | ||
Impaired mortgage loans, workout terms, interest only payments, six month terms | 6 months | ||
Impaired mortgage loans, workout terms, interest only payments, twelve month terms | 12 months | ||
Impaired mortgage loans, workout terms, cash flow sweep, number of months | 12 months | ||
Number of days past due, non-accrual status | 90 days | ||
Non-accrual loans | $ 0 | $ 2,200 | |
Minimum | |||
Loans and Leases Receivable Disclosure [Line Items] | |||
Number of days past due, delinquent status | 60 days | ||
Commercial Real Estate Portfolio Segment | |||
Loans and Leases Receivable Disclosure [Line Items] | |||
Commitments outstanding | $ 148,000 |
Mortgage Loans on Real Estate_3
Mortgage Loans on Real Estate (Summary of Mortgage Loan Portfolio) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | |||
Principal outstanding | $ 2,952,464 | $ 2,674,315 | $ 2,490,619 |
Loan loss allowance | (8,239) | (7,518) | |
Deferred prepayment fees | (1,134) | (1,266) | |
Mortgage loans on real estate | $ 2,943,091 | $ 2,665,531 |
Mortgage Loans on Real Estate_4
Mortgage Loans on Real Estate (Mortgage Loan Portfolio Summarized by Geographic Region and Property Type) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 2,952,464 | $ 2,674,315 | $ 2,490,619 |
Percent | 100.00% | 100.00% | |
East | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 586,773 | $ 548,067 | |
Percent | 19.90% | 20.50% | |
Middle Atlantic | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 168,969 | $ 163,485 | |
Percent | 5.70% | 6.10% | |
Mountain | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 357,642 | $ 308,486 | |
Percent | 12.10% | 11.50% | |
New England | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 9,418 | $ 12,265 | |
Percent | 0.30% | 0.50% | |
Pacific | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 521,363 | $ 466,030 | |
Percent | 17.70% | 17.40% | |
South Atlantic | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 694,599 | $ 609,736 | |
Percent | 23.50% | 22.80% | |
West North Central | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 291,890 | $ 324,808 | |
Percent | 9.90% | 12.20% | |
West South Central | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 321,810 | $ 241,438 | |
Percent | 10.90% | 9.00% | |
Office | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 268,932 | $ 283,926 | |
Percent | 9.10% | 10.60% | |
Medical Office | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 33,467 | $ 34,338 | |
Percent | 1.10% | 1.30% | |
Retail | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 1,091,627 | $ 1,040,028 | |
Percent | 37.00% | 38.90% | |
Industrial/Warehouse | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 762,887 | $ 677,770 | |
Percent | 25.80% | 25.30% | |
Apartment | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 600,638 | $ 462,897 | |
Percent | 20.30% | 17.30% | |
Agricultural | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 25,000 | $ 0 | |
Percent | 0.90% | 0.00% | |
Mixed Use/Other | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Principal outstanding | $ 169,913 | $ 175,356 | |
Percent | 5.80% | 6.60% |
Mortgage Loans on Real Estate_5
Mortgage Loans on Real Estate (Rollforward of Allowance for Loan Losses) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Beginning allowance balance | $ (7,518) | ||
Ending allowance balance | (8,239) | $ (7,518) | |
Specific Allowance | |||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Beginning allowance balance | (1,418) | (1,327) | $ (7,842) |
Charge-offs | 852 | 0 | 5,078 |
Recoveries | 1,592 | 631 | 5,483 |
Change in provision for credit losses | (1,255) | (722) | (4,046) |
Ending allowance balance | (229) | (1,418) | (1,327) |
General Allowance | |||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Beginning allowance balance | (6,100) | (7,100) | (6,300) |
Charge-offs | 0 | 0 | 0 |
Recoveries | 0 | 0 | 0 |
Change in provision for credit losses | (1,910) | 1,000 | (800) |
Ending allowance balance | $ (8,010) | $ (6,100) | $ (7,100) |
Mortgage Loans on Real Estate_6
Mortgage Loans on Real Estate (Impaired Mortgage Loans on Real Estate By Basis of Impairment) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | |||
Individually evaluated for impairment | $ 1,253 | $ 5,445 | $ 4,640 |
Collectively evaluated for impairment | 2,951,211 | 2,668,870 | 2,485,979 |
Principal outstanding | $ 2,952,464 | $ 2,674,315 | $ 2,490,619 |
Mortgage Loans on Real Estate_7
Mortgage Loans on Real Estate (Mortgage Loans by Credit Quality Indicator) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | |||
Performing | $ 2,952,464 | $ 2,670,657 | |
In workout | 0 | 1,436 | |
Collateral dependent | 0 | 2,222 | |
Principal outstanding | $ 2,952,464 | $ 2,674,315 | $ 2,490,619 |
Mortgage Loans on Real Estate_8
Mortgage Loans on Real Estate (Aging of Financing Receivables) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Commercial mortgage loans, past due | $ 0 | $ 0 | |
Commercial mortgage loans, current | 2,952,464 | 2,672,093 | |
Commercial mortgage loans, collateral dependent receivables | 0 | 2,222 | |
Principal outstanding | 2,952,464 | 2,674,315 | $ 2,490,619 |
30 to 59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Commercial mortgage loans, past due | 0 | 0 | |
60 to 89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Commercial mortgage loans, past due | 0 | 0 | |
90 Days and Over Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Commercial mortgage loans, past due | $ 0 | $ 0 |
Mortgage Loans on Real Estate_9
Mortgage Loans on Real Estate (Impaired Financing Receivables) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Financing Receivable, Impaired [Line Items] | |||
Mortgage loans with an allowance, recorded investment | $ 1,024 | $ 4,027 | |
Mortgage loans with no related allowance, recorded investment | 0 | 1,436 | |
Impaired mortgage loans, recorded investment | 1,024 | 5,463 | |
Mortgage loans with an allowance, unpaid principal balance | 1,253 | 5,445 | |
Mortgage loans with no related allowance, unpaid principal balance | 0 | 1,436 | |
Impaired mortgage loans, unpaid principal balance | 1,253 | 6,881 | |
Mortgage loans with an allowance, related allowance | (229) | (1,418) | |
Mortgage loans with an allowance, average recorded investment | 1,042 | 4,464 | $ 3,398 |
Mortgage loans with no related allowance, average recorded investment | 0 | 1,513 | 1,665 |
Impaired mortgage loans, average recorded investment | 1,042 | 5,977 | 5,063 |
Mortgage loans with an allowance, interest income recognized | 74 | 221 | 301 |
Mortgage loans with no related allowance, interest income recognized | 0 | 91 | 73 |
Impaired mortgage loans, interest income recognized | $ 74 | $ 312 | $ 374 |
Mortgage Loans on Real Estat_10
Mortgage Loans on Real Estate (Troubled Debt Restructurings) (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018loans | Dec. 31, 2017USD ($)loans | |
Financing Receivable, Modifications [Line Items] | ||
Financing receivable, modifications, period of time of delaying principal and/or interest, months | 3 months | |
Number of TDRs | loans | 0 | 2 |
Principal balance outstanding | $ 4,880 | |
Specific loan loss allowance | (467) | |
Net carrying amount | $ 4,413 | |
South Atlantic | ||
Financing Receivable, Modifications [Line Items] | ||
Number of TDRs | loans | 1 | |
Principal balance outstanding | $ 2,947 | |
Specific loan loss allowance | 0 | |
Net carrying amount | $ 2,947 | |
East | ||
Financing Receivable, Modifications [Line Items] | ||
Number of TDRs | loans | 1 | |
Principal balance outstanding | $ 1,933 | |
Specific loan loss allowance | (467) | |
Net carrying amount | $ 1,466 |
Derivative Instruments (Narrati
Derivative Instruments (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Derivative collateral | $ 200 | $ 1,600 |
Credit risk, maximum exposure | $ 16.1 | $ 11.9 |
Interest Rate Caps | ||
Derivative [Line Items] | ||
Derivative, term of contract | 7 years | |
Interest Rate Swap | ||
Derivative [Line Items] | ||
Derivative, term of contract | 7 years | |
Three Month London Interbank Offered Rate (LIBOR) | Interest Rate Caps | ||
Derivative [Line Items] | ||
Cap rate | 2.50% |
Derivative Instruments (Fair Va
Derivative Instruments (Fair Value of Derivative Instruments as Presented in the Consolidated Balance Sheets) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Derivatives, Fair Value [Line Items] | ||
Derivative assets | $ 205,149 | $ 1,568,380 |
Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 206,100 | 1,568,795 |
Derivative liabilities | 8,165,405 | 8,791,216 |
Not Designated as Hedging Instrument | Call Options | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 205,149 | 1,568,380 |
Not Designated as Hedging Instrument | Interest Rate Caps | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 597 | 415 |
Not Designated as Hedging Instrument | Interest Rate Swap | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 354 | 0 |
Derivative liabilities | 0 | 789 |
Not Designated as Hedging Instrument | Fixed Index Annuities - Embedded Derivatives | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | $ 8,165,405 | $ 8,790,427 |
Derivative Instruments (Change
Derivative Instruments (Change in Fair Value of Derivative Instruments) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Change in fair value of derivatives | $ (777,848) | $ 1,677,871 | $ 164,219 |
Change in fair value of embedded derivatives | (1,389,491) | 919,735 | 543,465 |
Call Options | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Change in fair value of derivatives | (778,899) | 1,678,283 | 165,029 |
Interest Rate Swap | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Change in fair value of derivatives | 869 | 255 | (482) |
Interest Rate Caps | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Change in fair value of derivatives | 182 | (667) | (328) |
Fixed Index Annuities - Embedded Derivatives | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Change in fair value of embedded derivatives | (2,167,628) | 174,154 | 145,045 |
Other Changes in Difference Between Policy Benefit Reserves Computed Using Derivative Accounting Vs. Long-Duration Contracts Accounting | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Change in fair value of embedded derivatives | $ 778,137 | $ 745,581 | $ 398,420 |
Derivative Instruments (Schedul
Derivative Instruments (Schedule of Call Options by Counterparty) (Details) - Call Options - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Derivative [Line Items] | ||
Notional amount | $ 39,420,777 | $ 35,498,003 |
Fair value | 205,149 | 1,568,380 |
Bank of America | ||
Derivative [Line Items] | ||
Notional amount | 6,518,808 | 4,645,366 |
Fair value | 6,704 | 237,955 |
Barclays | ||
Derivative [Line Items] | ||
Notional amount | 2,301,414 | 4,135,537 |
Fair value | 27,032 | 154,127 |
BNP Paribas | ||
Derivative [Line Items] | ||
Notional amount | 0 | 1,411,989 |
Fair value | 0 | 73,650 |
Canadian Imperial Bank of Commerce | ||
Derivative [Line Items] | ||
Notional amount | 4,856,150 | 2,808,030 |
Fair value | 29,313 | 84,268 |
Citibank, N.A. | ||
Derivative [Line Items] | ||
Notional amount | 4,792,208 | 4,104,666 |
Fair value | 27,239 | 219,900 |
Credit Suisse | ||
Derivative [Line Items] | ||
Notional amount | 2,877,916 | 3,538,855 |
Fair value | 12,887 | 137,384 |
J.P. Morgan | ||
Derivative [Line Items] | ||
Notional amount | 3,701,964 | 1,753,649 |
Fair value | 17,564 | 109,689 |
Morgan Stanley | ||
Derivative [Line Items] | ||
Notional amount | 3,560,044 | 3,408,179 |
Fair value | 1,561 | 184,323 |
Royal Bank of Canada | ||
Derivative [Line Items] | ||
Notional amount | 1,871,305 | 3,027,469 |
Fair value | 14,011 | 104,141 |
Societe Generale | ||
Derivative [Line Items] | ||
Notional amount | 2,343,165 | 0 |
Fair value | 21,681 | 0 |
SunTrust | ||
Derivative [Line Items] | ||
Notional amount | 1,755,030 | 2,331,168 |
Fair value | 12,047 | 90,399 |
Wells Fargo | ||
Derivative [Line Items] | ||
Notional amount | 4,618,569 | 4,036,255 |
Fair value | 33,398 | 162,781 |
Exchange Traded | ||
Derivative [Line Items] | ||
Notional amount | 224,204 | 296,840 |
Fair value | $ 1,712 | $ 9,763 |
Derivative Instruments (Interes
Derivative Instruments (Interest Rate Swap) (Details) - Interest Rate Swap, Maturity Date, March 15, 2021, 2.415% - Interest Rate Swap - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Derivative [Line Items] | ||
Notional amount | $ 85,500 | |
Pay rate | 2.415% | |
Derivative assets | $ 354 | |
Derivative liabilities | $ (789) |
Derivative Instruments (Inter_2
Derivative Instruments (Interest Rate Caps) (Details) - Interest Rate Caps - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Derivative [Line Items] | ||
Notional amount | $ 79,000 | |
Derivative assets | 597 | $ 415 |
Interest Rate Caps, Maturity Date, July 7, 2021, 2.50% | ||
Derivative [Line Items] | ||
Notional amount | $ 40,000 | |
Cap rate | 2.50% | |
Derivative assets | $ 302 | 207 |
Interest Rate Caps, Maturity Date, July 8, 2021, 2.50% | ||
Derivative [Line Items] | ||
Notional amount | $ 12,000 | |
Cap rate | 2.50% | |
Derivative assets | $ 91 | 62 |
Interest Rate Caps, Maturity Date, July 29, 2021, 2.50% | ||
Derivative [Line Items] | ||
Notional amount | $ 27,000 | |
Cap rate | 2.50% | |
Derivative assets | $ 204 | $ 146 |
Deferred Policy Acquisition C_3
Deferred Policy Acquisition Costs, Deferred Sales Inducements and Liability for Lifetime Income Benefit Riders (Deferred Policy Acquisition Costs) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Movement Analysis of Deferred Policy Acquisition Costs [Roll Forward] | |||
Balance at beginning of year | $ 2,714,523 | $ 2,905,377 | $ 2,905,136 |
Costs deferred during the year: commissions | 384,432 | 401,124 | 538,863 |
Costs deferred during the year: policy issue costs | 3,790 | 5,517 | 4,462 |
Amortization: Amortization | (358,563) | (304,162) | (325,848) |
Amortization: Impact of unlocking | 30,572 | 48,198 | (48,164) |
Effect of net unrealized gains/losses | 761,084 | (341,531) | (169,072) |
Balance at end of year | $ 3,535,838 | $ 2,714,523 | $ 2,905,377 |
Assumptions, revision to extend period of time related to investment spread targets | 2 years |
Deferred Policy Acquisition C_4
Deferred Policy Acquisition Costs, Deferred Sales Inducements and Liability for Lifetime Income Benefit Riders (Deferred Sales Inducements) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Movement in Deferred Sales Inducements [Roll Forward] | |||
Balance at beginning of year | $ 2,001,892 | $ 2,208,218 | $ 2,232,148 |
Costs deferred during the year | 179,465 | 216,172 | 353,966 |
Amortization: Amortization | (243,666) | (210,886) | (215,406) |
Amortization: Impact of unlocking | 21,465 | 34,274 | (35,760) |
Effect of net unrealized gains/losses | 557,565 | (245,886) | (126,730) |
Balance at end of year | $ 2,516,721 | $ 2,001,892 | $ 2,208,218 |
Assumptions, revision to extend period of time related to investment spread targets | 2 years |
Deferred Policy Acquisition C_5
Deferred Policy Acquisition Costs, Deferred Sales Inducements and Liability for Lifetime Income Benefit Riders (Liability for Lifetime Income Benefit Riders) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Liability for Future Policy Benefit, by Product Segment [Line Items] | |||
Balance at beginning of year | $ 56,142,673 | ||
Balance at end of year | 57,606,009 | $ 56,142,673 | |
Liability for Lifetime Income Benefit Riders | |||
Liability for Future Policy Benefit, by Product Segment [Line Items] | |||
Balance at beginning of year | 704,441 | 533,391 | $ 351,946 |
Benefit expense accrual | 157,333 | 149,442 | 139,443 |
Impact of unlocking | (53,607) | 21,608 | 42,002 |
Claim payments | 0 | 0 | 0 |
Balance at end of year | $ 808,167 | $ 704,441 | $ 533,391 |
Reinsurance and Policy Provis_3
Reinsurance and Policy Provisions (Equitrust Coinsurance Agreements) (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)coinsurance_agreement | Dec. 31, 2017USD ($) | |
Ceded Credit Risk [Line Items] | ||
Coinsurance deposits | $ 4,954,068 | $ 4,858,289 |
Equitrust Coinsurance Agreements, All Periods | ||
Ceded Credit Risk [Line Items] | ||
Number of coinsurance agreements | coinsurance_agreement | 2 | |
Coinsurance deposits | $ 560,800 | 649,900 |
Reinsurance payable | $ 2,200 | $ 11,000 |
Equitrust Coinsurance Agreement, August 1, 2001 to December 31, 2001 | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 70.00% | |
Equitrust Coinsurance Agreement, January 1, 2002 to December 31, 2003 | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 40.00% | |
Equitrust Coinsurance Agreement, January 1, 2004 to July 31, 2004 | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 20.00% |
Reinsurance and Policy Provis_4
Reinsurance and Policy Provisions (Athene Coinsurance Agreements) (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)coinsurance_agreement | Dec. 31, 2017USD ($) | |
Ceded Credit Risk [Line Items] | ||
Coinsurance deposits | $ 4,954,068 | $ 4,858,289 |
Athene Coinsurance Agreements, All Periods | ||
Ceded Credit Risk [Line Items] | ||
Number of coinsurance agreements | coinsurance_agreement | 3 | |
Coinsurance deposits | $ 4,400,000 | 4,200,000 |
Reinsurance payable | $ 16,200 | $ 79,900 |
Fixed Index Annuities | American Equity Life | Athene, 1st Coinsurance Agreement, January 1, 2009 to March 31, 2010 | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 20.00% | |
Fixed Index Annuities | American Equity Life | Athene, 3rd Coinsurance Agreement, August 1, 2016 to December 31, 2016 | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 80.00% | |
Fixed Index Annuities | Eagle Life | Athene, 3rd Coinsurance Agreement, January 1, 2014 to December 31, 2016 | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 80.00% | |
Fixed Index Annuities | Eagle Life | Athene, 3rd Coinsurance Agreement, January 1, 2017 to December 31, 2018 | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 50.00% | |
Fixed Index Annuities | Eagle Life | Athene, 3rd Coinsurance Agreement, January 1, 2019 Going Forward | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 20.00% | |
Multi-Year Rate Guaranteed Annuities | American Equity Life | Athene, 2nd Coinsurance Agreement, July 1, 2009 to December 31, 2013 | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 80.00% | |
Multi-Year Rate Guaranteed Annuities | American Equity Life | Athene, 3rd Coinsurance Agreement, January 1, 2014 Going Forward | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 80.00% | |
Multi-Year Rate Guaranteed Annuities | Eagle Life | Athene, 2nd Coinsurance Agreement, November 20, 2013 to December 31, 2013 | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 80.00% | |
Multi-Year Rate Guaranteed Annuities | Eagle Life | Athene, 3rd Coinsurance Agreement, January 1, 2014 Going Forward | ||
Ceded Credit Risk [Line Items] | ||
Coninsurance percentage on certain annuities | 80.00% |
Reinsurance and Policy Provis_5
Reinsurance and Policy Provisions (Amounts Ceded to Equitrust and Athene, Impact on Consolidated Statements of Operations and Consolidated Statements of Cash Flows) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Effects of Reinsurance [Line Items] | |||||||||||
Annuity product charges | $ 224,488 | $ 200,494 | $ 173,579 | ||||||||
Change in fair value of derivatives | $ (1,054,281) | $ 595,311 | $ 132,205 | $ (451,083) | $ 661,993 | $ 362,525 | $ 266,820 | $ 386,533 | (777,848) | 1,677,871 | 164,219 |
Interest sensitive and index product benefits | 1,610,835 | 2,023,668 | 725,472 | ||||||||
Change in fair value of embedded derivatives | (1,389,491) | 919,735 | 543,465 | ||||||||
Other operating costs and expenses | 129,301 | 111,691 | 102,231 | ||||||||
Coinsurance deposits | (23,838) | (6,597) | (1,317,555) | ||||||||
Coinsurance Agreements, EquiTrust and Athene | |||||||||||
Effects of Reinsurance [Line Items] | |||||||||||
Annuity product charges | 7,074 | 6,458 | 5,366 | ||||||||
Change in fair value of derivatives | (41,487) | 94,382 | 18,446 | ||||||||
Coinsurance, revenues included in consolidated statement of operations | (34,413) | 100,840 | 23,812 | ||||||||
Interest sensitive and index product benefits | 165,485 | 177,332 | 93,487 | ||||||||
Change in fair value of embedded derivatives | (92,649) | 35,561 | 23,848 | ||||||||
Other operating costs and expenses | 20,415 | 19,877 | 24,039 | ||||||||
Coinsurance, benefits and expenses included in the consolidated statement of operations | 93,251 | 232,770 | 141,374 | ||||||||
Annuity deposits | (413,222) | (387,280) | (1,736,054) | ||||||||
Cash payments to policyholders | 389,384 | 380,683 | 418,499 | ||||||||
Coinsurance deposits | $ (23,838) | $ (6,597) | $ (1,317,555) |
Reinsurance and Policy Provis_6
Reinsurance and Policy Provisions (Hannover Financing Arrangements) (Details) - 2013 Hannover Reinsurance Agreement - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Ceded Credit Risk [Line Items] | |||
Waived surrender charges on penalty free withdrawals and deaths on certain business, percentage | 45.60% | ||
Reserve credit | $ 780 | $ 737.3 | |
Risk charges | $ 30.8 | $ 28.5 | $ 27.7 |
Income Taxes (Components of Inc
Income Taxes (Components of Income Tax Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Consolidated statements of operations: | |||
Current income taxes | $ 120,289 | $ 188,356 | $ 57,412 |
Deferred income taxes (benefits) | (12,563) | (46,730) | (10,408) |
Total income tax expense included in consolidated statements of operations | 107,726 | 141,626 | 47,004 |
Stockholders' equity: | |||
Expense (benefit) relating to: Change in net unrealized investment losses | (240,459) | 177,162 | 74,471 |
Expense (benefit) relating to: Share-based compensation | (527) | ||
Total income tax expense (benefit) included in consolidated financial statements | $ (132,733) | $ 318,788 | $ 120,948 |
Income Taxes (Effective Income
Income Taxes (Effective Income Tax Rate Reconciliation) (Details) - USD ($) $ in Thousands | Jan. 01, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Income Tax Disclosure [Abstract] | |||||
Income before income taxes | $ 565,742 | $ 316,271 | $ 130,247 | ||
Income tax expense on income before income taxes | 118,806 | 110,695 | 45,586 | ||
Tax effect of: State income taxes | 5,777 | 1,961 | 2,559 | ||
Tax effect of: Tax exempt net investment income | (4,223) | (4,288) | (2,167) | ||
Tax effect of: Impact of Tax Reform | 0 | 35,932 | 0 | ||
Tax effect of: Worthless stock deduction | (7,448) | 0 | 0 | ||
Tax effect of: Other | (5,186) | (2,674) | 1,026 | ||
Total income tax expense included in consolidated statements of operations | $ 107,726 | $ 141,626 | $ 47,004 | ||
Effective tax rate | 19.00% | 44.80% | 36.10% | ||
Statutory federal income tax rate | 21.00% | 21.00% | 35.00% | 35.00% | |
Enacted tax rate applied to deferred tax balances, percent | 21.00% |
Income Taxes (Deferred Tax Asse
Income Taxes (Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Valuation Allowance [Line Items] | ||
Deferred tax assets, valuation allowance | $ 0 | $ 0 |
Net operating loss carryforwards | 0 | |
Deferred income tax assets: | ||
Policy benefit reserves | 1,538,371 | 1,842,049 |
Other than temporary impairments | 9,804 | 11,262 |
Net unrealized losses on available for sale securities | 19,928 | 0 |
Derivative instruments | 141,075 | 0 |
Amounts due reinsurer | 0 | 6,852 |
Other policyholder funds | 3,368 | 3,724 |
Deferred compensation | 3,334 | 3,827 |
Share-based compensation | 3,169 | 3,383 |
State net operating loss carryforwards | 2,286 | 3,196 |
Other | 9,439 | 10,253 |
Gross deferred tax assets | 1,730,774 | 1,884,546 |
Deferred income tax liabilities: | ||
Deferred policy acquisition costs and deferred sales inducements | (1,214,998) | (1,212,509) |
Net unrealized gains on available for sale fixed maturity and equity securities | 0 | (220,533) |
Derivative instruments | 0 | (179,776) |
Policy benefit reserves | (172,578) | (197,233) |
Investment income items | (37,795) | (34,849) |
Amounts due reinsurer | (12,620) | 0 |
Other | (1,614) | (1,499) |
Gross deferred tax liabilities | (1,439,605) | (1,846,399) |
Net deferred income tax asset | 291,169 | $ 38,147 |
Deferred Tax Asset, Valuation Allowance, Unrealized Losses on Available For Sale Fixed Maturity Securities | ||
Valuation Allowance [Line Items] | ||
Deferred tax assets, valuation allowance | $ 0 |
Notes and Loan Payable and Am_3
Notes and Loan Payable and Amounts Due Under Repurchase Agreements (Schedule of Notes Payable) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Jun. 16, 2017 |
Debt Instrument [Line Items] | |||
Notes payable | $ 494,591 | $ 494,093 | |
June 2027 Notes | |||
Debt Instrument [Line Items] | |||
Debt instrument, face amount | 500,000 | 500,000 | $ 500,000 |
Unamortized debt issue costs | (5,102) | (5,572) | |
Unamortized discount | $ (307) | $ (335) | $ (300) |
Notes and Loan Payable and Am_4
Notes and Loan Payable and Amounts Due Under Repurchase Agreements Notes and Loan Payable and Amounts Due Under Repurchase Agreements (2027 Notes Narrative) (Details) (Details) - USD ($) $ in Thousands | Jul. 17, 2017 | Jun. 16, 2017 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | |||||||||
Extinguishment of debt, cash paid | $ 0 | $ 413,252 | $ 0 | ||||||
Loss on extinguishment of debt | $ 0 | $ 18,389 | $ 428 | $ 0 | 0 | 18,817 | $ 0 | ||
June 2027 Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, face amount | $ 500,000 | 500,000 | 500,000 | 500,000 | |||||
Interest rate | 5.00% | ||||||||
Unamortized discount | $ 300 | $ 335 | $ 307 | $ 335 | |||||
Deferred financing costs | 5,800 | ||||||||
Term Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Extinguishment of debt, amount | $ 100,000 | ||||||||
July 2021 Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Extinguishment of debt, amount | $ 400,000 | ||||||||
Extinguishment of debt, cash paid | $ 413,300 | ||||||||
Debt instrument, redemption price, percentage | 3.313% | ||||||||
Loss on extinguishment of debt | $ 18,400 |
Notes and Loan Payable and Am_5
Notes and Loan Payable and Amounts Due Under Repurchase Agreements (Line of Credit and Term Loan Narrative) (Details) - September 30, 2016 Credit Agreement $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)occasionsguarantor | Dec. 31, 2017USD ($) | Sep. 30, 2016USD ($)banks | |
Debt Instrument [Line Items] | |||
Credit agreement, number of banks in the agreement | banks | 6 | ||
Credit agreement, interest rate, floating, applicable margin | 0.75% | ||
Credit agreement, interest rate, floating, adjusted LIBOR | 1.75% | ||
Minimum risk-based capital ratio | 275.00% | ||
Maximum debt to capital ratio | 0.35 | ||
Minimum capital to be retained | 80.00% | ||
Minimum portion of net income to be retained | 50.00% | ||
Minimum capital contributions to be retained | 50.00% | ||
Cash in excess of amount required by covenants | $ 838,600 | ||
2016 Line of Credit | |||
Debt Instrument [Line Items] | |||
Line of credit, maximum borrowing capacity | $ 150,000 | ||
Line of credit, unused capacity, commitment fee percentage | 0.275% | ||
Line of credit, number of occasions borrowing capacity can be increased | occasions | 3 | ||
Line of credit, additional borrowing capacity, aggregate amount | $ 50,000 | ||
Line of credit, duration of maturity date extension available, years | 1 year | ||
Credit agreement, number of guarantors | guarantor | 0 | ||
Line of credit, amount outstanding | $ 0 | $ 0 | |
Term Loan | |||
Debt Instrument [Line Items] | |||
Term loan | $ 100,000 | ||
Interest rate, effective percentage | 3.125% |
Notes and Loan Payable and Am_6
Notes and Loan Payable and Amounts Due Under Repurchase Agreements (Repurchase Agreements Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |||
Repurchase agreement, maximum amount borrowed | $ 544.1 | $ 274.5 | $ 113 |
Repurchase agreement, average borrowings | $ 51.8 | $ 40 | $ 4.5 |
Repurchase agreement, weighted average interest rate | 1.90% | 0.84% | 0.66% |
Subordinated Debentures (Narrat
Subordinated Debentures (Narrative) (Details) - American Equity Capital Trust II $ in Millions | Dec. 31, 2018USD ($) |
Subordinated Borrowing [Line Items] | |
Debt instrument, face amount | $ 100 |
Subordinated debentures, fair value at issuance | $ 74.7 |
Interest rate, effective percentage | 6.80% |
Ownership percentage, Iowa Farm Bureau Federation | 50.00% |
Subordinated Debentures (Summar
Subordinated Debentures (Summary of Subordinated Debt Obligations to the Trusts) (Details) - Subordinated Debentures - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Subordinated Borrowing [Line Items] | |||
Subordinated debentures, gross | $ 247,161 | $ 246,908 | |
Unamortized debt issue costs | (4,179) | (4,343) | |
Subordinated debentures | 242,982 | 242,565 | |
American Equity Capital Trust II | |||
Subordinated Borrowing [Line Items] | |||
Subordinated debentures, gross | $ 77,551 | 77,298 | |
Interest rate | 5.00% | ||
Subordinated borrowing, due date | Jun. 1, 2047 | ||
American Equity Capital Trust III | |||
Subordinated Borrowing [Line Items] | |||
Subordinated debentures, gross | $ 27,840 | 27,840 | |
Description of variable rate basis | [1] | *LIBOR + | |
Basis spread on variable rate | 3.90% | ||
Subordinated borrowing, due date | Apr. 29, 2034 | ||
American Equity Capital Trust IV | |||
Subordinated Borrowing [Line Items] | |||
Subordinated debentures, gross | $ 12,372 | 12,372 | |
Description of variable rate basis | [1] | *LIBOR + | |
Basis spread on variable rate | 4.00% | ||
Subordinated borrowing, due date | Jan. 8, 2034 | ||
American Equity Capital Trust VII | |||
Subordinated Borrowing [Line Items] | |||
Subordinated debentures, gross | $ 10,830 | 10,830 | |
Description of variable rate basis | [1] | *LIBOR + | |
Basis spread on variable rate | 3.75% | ||
Subordinated borrowing, due date | Dec. 14, 2034 | ||
American Equity Capital Trust VIII | |||
Subordinated Borrowing [Line Items] | |||
Subordinated debentures, gross | $ 20,620 | 20,620 | |
Description of variable rate basis | [1] | *LIBOR + | |
Basis spread on variable rate | 3.75% | ||
Subordinated borrowing, due date | Dec. 15, 2034 | ||
American Equity Capital Trust IX | |||
Subordinated Borrowing [Line Items] | |||
Subordinated debentures, gross | $ 15,470 | 15,470 | |
Description of variable rate basis | [1] | *LIBOR + | |
Basis spread on variable rate | 3.65% | ||
Subordinated borrowing, due date | Jun. 15, 2035 | ||
American Equity Capital Trust X | |||
Subordinated Borrowing [Line Items] | |||
Subordinated debentures, gross | $ 20,620 | 20,620 | |
Description of variable rate basis | [1] | *LIBOR + | |
Basis spread on variable rate | 3.65% | ||
Subordinated borrowing, due date | Sep. 15, 2035 | ||
American Equity Capital Trust XI | |||
Subordinated Borrowing [Line Items] | |||
Subordinated debentures, gross | $ 20,620 | 20,620 | |
Description of variable rate basis | [1] | *LIBOR + | |
Basis spread on variable rate | 3.65% | ||
Subordinated borrowing, due date | Dec. 15, 2035 | ||
American Equity Capital Trust XII | |||
Subordinated Borrowing [Line Items] | |||
Subordinated debentures, gross | $ 41,238 | $ 41,238 | |
Description of variable rate basis | [1] | *LIBOR + | |
Basis spread on variable rate | 3.50% | ||
Subordinated borrowing, due date | Apr. 7, 2036 | ||
[1] | three month London Interbank Offered Rate |
Retirement and Share-based Co_3
Retirement and Share-based Compensation Plans (Defined Contribution Plan) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Defined contribution plan, maximum annual employee contribution | $ 18,500 | $ 18,000 | $ 18,000 |
Defined contribution plan, employer plan contributions | $ 1,700,000 | $ 1,400,000 | $ 1,300,000 |
Retirement and Share-based Co_4
Retirement and Share-based Compensation Plans (Share-based Compensation Expense By Plan) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
ESOP, compensation expense | $ 2,194 | $ 1,474 | $ 2,522 |
Compensation expense | 8,594 | 4,441 | 4,414 |
Employee Incentive Plans | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | 5,434 | 2,155 | 1,207 |
Director Equity Plans | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | $ 966 | $ 812 | $ 685 |
Retirement and Share-based Co_5
Retirement and Share-based Compensation Plans (Employee Stock Ownership Plan) (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
ESOP, requisite service period | 6 months |
ESOP, vesting percentage | 100.00% |
ESOP, vesting period | 2 years |
Retirement and Share-based Co_6
Retirement and Share-based Compensation Plans (Incentive Plans) (Details) - shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
2016 Employee Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized | 2,500,000 | ||
Number of shares available for future grant | 1,967,395 | ||
2016 Employee Incentive Plan | Performance Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Equity instruments granted | 105,617 | 84,476 | 208,565 |
Duration used to measure performance and threshold goals | 3 years | ||
2016 Employee Incentive Plan | Performance Units | Threshold Goals, Vesting Percentage | 2018 Employee Grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights, percentage | 50.00% | ||
2016 Employee Incentive Plan | Performance Units | Threshold Goals, Vesting Percentage | 2017 Employee Grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights, percentage | 50.00% | ||
2016 Employee Incentive Plan | Performance Units | Threshold Goals, Vesting Percentage | 2016 Employee Grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights, percentage | 50.00% | ||
2016 Employee Incentive Plan | Performance Units | Target Performance Goals, Vesting Percentage | 2018 Employee Grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights, percentage | 100.00% | ||
2016 Employee Incentive Plan | Performance Units | Target Performance Goals, Vesting Percentage | 2017 Employee Grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights, percentage | 100.00% | ||
2016 Employee Incentive Plan | Performance Units | Target Performance Goals, Vesting Percentage | 2016 Employee Grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights, percentage | 100.00% | ||
2016 Employee Incentive Plan | Performance Units | Maximum Performance Goals, Vesting Percentage | 2018 Employee Grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights, percentage | 150.00% | ||
2016 Employee Incentive Plan | Performance Units | Maximum Performance Goals, Vesting Percentage | 2017 Employee Grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights, percentage | 150.00% | ||
2016 Employee Incentive Plan | Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Shares issued in period | 36,270 | 39,826 | 43,373 |
Participant age for full vesting | 65 years | ||
Requisite service period for full vesting | 10 years | ||
2016 Employee Incentive Plan | Restricted Stock | 2016 Revised Grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares issued in period | 21,806 | ||
2016 Employee Incentive Plan | Restricted Stock | Share-based Compensation Award, Tranche One | 2017 Employee Grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 1 year | ||
Shares issued in period | 6,727 | ||
2016 Employee Incentive Plan | Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 1 year | ||
Equity instruments granted | 85,500 | ||
2016 Employee Incentive Plan | Restricted Stock Units | Share-based Compensation Award, Tranche One | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Equity instruments granted | 6,000 | ||
2009 Employee Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized | 2,500,000 | ||
Duration of award | 10 years | ||
Award vesting period | 3 years | ||
2009 Employee Incentive Plan | March 2010 Option Grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Duration of award | 6 years | ||
2013 Director Equity And Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized | 250,000 | ||
Number of shares available for future grant | 54,900 | ||
2013 Director Equity And Incentive Plan | Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares issued in period | 28,600 | 33,000 | 47,500 |
Maximum | 2013 Director Equity And Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 1 year |
Retirement and Share-based Co_7
Retirement and Share-based Compensation Plans (2014 Independent Insurance Agent Restricted Stock and Restricted Stock Unit Plan) (Details) - 2014 Independent Insurance Agent Restricted Stock and Restricted Stock Unit Plan - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized | 1,800,000 | ||||
Number of shares available for future grant | 667,626 | ||||
2015 and 2016 American Equity Life Agent Grant | Restricted Stock Units | Share-based Compensation Award, Tranche One | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting rights, percentage | 20.00% | ||||
Award vesting period | 1 year | ||||
2015 and 2016 American Equity Life Agent Grant | Retirement Eligible Agent | Restricted Stock Units | Share-based Compensation Award, Tranche Two | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting rights, percentage | 80.00% | ||||
Award vesting period | 3 years | ||||
2015 and 2016 American Equity Life Agent Grant | Non-Retirement Eligible Agent | Restricted Stock Units | Share-based Compensation Award, Tranche Two | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting rights, percentage | 80.00% | ||||
2015 and 2016 American Equity Life Agent Grant | Non-Retirement Eligible Agent | Restricted Stock Units | Maximum | Share-based Compensation Award, Tranche Two | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 5 years | ||||
2016 American Equity Life Agent Grant | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Commission expense | $ 1.6 | $ 1.3 | $ 2.6 | ||
2016 American Equity Life Agent Grant | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Equity instruments granted | 363,624 | ||||
Award vested in period | 57,562 | 138,820 | |||
2015 American Equity Life Agent Grant | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Commission expense | $ 2.4 | $ 2.2 | $ 1.7 | ||
2015 American Equity Life Agent Grant | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Equity instruments granted | 650,683 | ||||
Award vested in period | 89,367 | 100,586 | 246,532 | ||
2014 American Equity Life Agent Grant | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Commission expense | $ 0.9 | $ 0.8 | $ 0.6 | ||
2014 American Equity Life Agent Grant | Retirement Eligible Agent | Restricted Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Equity instruments granted | 27,985 | ||||
2014 American Equity Life Agent Grant | Non-Retirement Eligible Agent | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Equity instruments granted | 221,489 | ||||
Award vested in period | 28,575 | 32,815 | 36,609 | ||
2014 American Equity Life Agent Grant | Non-Retirement Eligible Agent | Restricted Stock Units | Share-based Compensation Award, Tranche One | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting rights, percentage | 20.00% | ||||
Award vesting period | 1 year | ||||
2014 American Equity Life Agent Grant | Non-Retirement Eligible Agent | Restricted Stock Units | Share-based Compensation Award, Tranche Two | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting rights, percentage | 80.00% | ||||
2014 American Equity Life Agent Grant | Non-Retirement Eligible Agent | Restricted Stock Units | Maximum | Share-based Compensation Award, Tranche Two | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 5 years |
Retirement and Share-based Co_8
Retirement and Share-based Compensation Plans (Changes in Stock Options Outstanding) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Outstanding, number of shares | 1,221,865 | 1,980,265 | 2,918,946 | 3,443,991 |
Outstanding, weighted-average exercise price per share | $ 17.41 | $ 16.20 | $ 16.06 | $ 15.17 |
Outstanding, total exercise price | $ 21,273 | $ 32,084 | $ 46,885 | $ 52,240 |
Granted, number of shares | 0 | 0 | 0 | |
Granted, weighted-average exercise price per share | $ 0 | $ 0 | $ 0 | |
Granted, total exercise price | $ 0 | $ 0 | $ 0 | |
Canceled, number of shares | (40,850) | (57,200) | (24,700) | |
Canceled, weighted-average exercise price per share | $ 18.87 | $ 13.66 | $ 14.83 | |
Canceled, total exercise price | $ (771) | $ (781) | $ (366) | |
Exercised, number of shares | (717,550) | (881,481) | (500,345) | |
Exercised, weighted-average exercise price per share | $ 13.99 | $ 15.90 | $ 9.97 | |
Exercised, total exercise price | $ (10,040) | $ (14,020) | $ (4,989) | |
Stock Option Plans, 1996 Stock Option Plan, 2000 Employee Stock Option Plan, 2000 Directors Stock Option Plan, 2011 Directors Stock Option Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized | 3,475,000 | |||
Duration of award | 10 years | |||
Stock Option Plans, 1996 Stock Option Plan, 2000 Employee Stock Option Plan, 2000 Directors Stock Option | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 6 months | |||
Stock Option Plans, 2011 Director Stock Option Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 3 years | |||
Number of shares available for future grant | 18,000 | |||
Stock Option Plans, Independent Insurance Agent Stock Option Plans | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized | 8,000,000 |
Retirement and Share-based Co_9
Retirement and Share-based Compensation Plans (Schedule of Stock Options Outstanding, By Exercise Price Range) (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||
Options outstanding and vested, aggregate intrinsic value | $ 12.9 | ||
Proceeds from stock options exercised | 10 | $ 14 | $ 5 |
Stock Option Plans, All Stock Option Plans For Officers, Directors And Employees | |||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||
Options exercised in period, total intrinsic value | $ 3 | $ 1.5 | $ 4 |
Exercise Price Range I | |||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||
Exercise price range, lower range limit | $ 5.07 | ||
Exercise price range, upper range limit | $ 8.02 | ||
Stock options outstanding and vested, number of awards | 122,500 | ||
Stock options outstanding and vested, remaining life (yrs) | 4 months 11 days | ||
Stock options outstanding and vested, weighted-average exercise price per share | $ 6.77 | ||
Exercise Price Range II | |||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||
Exercise price range, lower range limit | 9.27 | ||
Exercise price range, upper range limit | $ 11.35 | ||
Stock options outstanding and vested, number of awards | 252,515 | ||
Stock options outstanding and vested, remaining life (yrs) | 1 year 6 months 16 days | ||
Stock options outstanding and vested, weighted-average exercise price per share | $ 9.97 | ||
Exercise Price Range III | |||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||
Exercise price range, lower range limit | 12.04 | ||
Exercise price range, upper range limit | $ 24.79 | ||
Stock options outstanding and vested, number of awards | 846,850 | ||
Stock options outstanding and vested, remaining life (yrs) | 1 year 10 months 3 days | ||
Stock options outstanding and vested, weighted-average exercise price per share | $ 21.17 | ||
Exercise Price Range, All Options | |||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||
Exercise price range, lower range limit | 5.07 | ||
Exercise price range, upper range limit | $ 24.79 | ||
Stock options outstanding and vested, number of awards | 1,221,865 | ||
Stock options outstanding and vested, remaining life (yrs) | 1 year 7 months 18 days | ||
Stock options outstanding and vested, weighted-average exercise price per share | $ 17.41 |
Retirement and Share-based C_10
Retirement and Share-based Compensation Plans (Deferred Compensation Arrangements) (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred Compensation Plans, Certain Officers, Directors and Consultants | ||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||
Shares reserved for future issuance | 364,000 | 364,000 |
Deferred Compensation Plans, Officer Rabbi Trust | ||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||
Shares reserved for future issuance | 32,597 | 34,539 |
Deferred compensation liability | $ 1.5 | $ 2 |
Statutory Financial Informati_3
Statutory Financial Information and Dividend Restrictions (Narrative and Statutory Accounting Practices Tables) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Insurance [Abstract] | |||
American Equity Life, statutory net income | $ 210,049 | $ 375,900 | $ 75,035 |
American Equity Life, statutory capital and surplus balance | 3,251,881 | 3,005,654 | |
Statutory Accounting Practices, permitted practice, amount | 232,400 | 109,700 | |
Total adjusted capital | 3,542,339 | 3,260,328 | |
Company Action Level RBC | $ 983,169 | $ 861,419 | |
Ratio of adjusted capital to Company Action Level RBC | 360.00% | 378.00% | |
Statutory Accounting Practices, Statutory Amount Available for Dividend Payments [Abstract] | |||
Statutory amount available for dividend payments without regulatory approval | $ 325,200 | ||
Dividends paid by insurance subsidiaries | $ 0 | $ 0 | $ 0 |
Commitments and Contingencies_2
Commitments and Contingencies (Narrative and Schedule of Future Minimum Rental Payments for Operating Leases) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Rent expense | $ 3,200 | $ 2,900 | $ 2,800 |
Aggregate future minimum lease payments due | 13,400 | ||
2,019 | 1,986 | ||
2,020 | 2,037 | ||
2,021 | 1,841 | ||
2,022 | 1,680 | ||
2,023 | 1,481 | ||
2024 and thereafter | 4,364 | ||
Limited Partnerships | |||
Other Commitments [Line Items] | |||
Unfunded commitments | 56,000 | ||
Privately Placed Corporate Securities | |||
Other Commitments [Line Items] | |||
Unfunded commitments | $ 109,700 |
Earnings Per Share and Stockh_3
Earnings Per Share and Stockholders' Equity (Schedule of Earnings Per Share, Basic and Diluted) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Earnings Per Share, Basic and Diluted [Line Items] | |||||||||||
Net income - numerator for earnings per common share | $ 53,823 | $ 169,328 | $ 93,903 | $ 140,962 | $ 36,803 | $ 56,957 | $ 26,946 | $ 53,939 | $ 458,016 | $ 174,645 | $ 83,243 |
Weighted average common shares outstanding (shares) | 90,347,915 | 88,982,442 | 84,793,151 | ||||||||
Effect of dilutive securities: Warrants (shares) | 0 | 0 | 15,136 | ||||||||
Denominator for earnings per common share - assuming dilution (shares) | 91,422,585 | 90,311,008 | 85,605,169 | ||||||||
Earnings per common share | $ 0.59 | $ 1.87 | $ 1.04 | $ 1.57 | $ 0.41 | $ 0.64 | $ 0.30 | $ 0.61 | $ 5.07 | $ 1.96 | $ 0.98 |
Earnings per common share - assuming dilution | $ 0.59 | $ 1.85 | $ 1.03 | $ 1.55 | $ 0.41 | $ 0.63 | $ 0.30 | $ 0.60 | $ 5.01 | $ 1.93 | $ 0.97 |
Stock Options And Deferred Compensation Agreements | |||||||||||
Earnings Per Share, Basic and Diluted [Line Items] | |||||||||||
Effect of dilutive securities: Share-based payment agreements (shares) | 709,433 | 945,612 | 456,236 | ||||||||
Restricted Stock And Restricted Stock Units | |||||||||||
Earnings Per Share, Basic and Diluted [Line Items] | |||||||||||
Effect of dilutive securities: Share-based payment agreements (shares) | 365,237 | 382,954 | 340,646 |
Earnings Per Share and Stockh_4
Earnings Per Share and Stockholders' Equity (Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share) (Details) - Stock Options - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Number of shares | 0 | 0 | 1,054,091 |
Minimum | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Range of exercise prices | $ 0 | $ 0 | $ 24.79 |
Maximum | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Range of exercise prices | $ 0 | $ 0 | $ 24.79 |
Earnings Per Share and Stockh_5
Earnings Per Share and Stockholders' Equity (Stockholders' Equity) (Details) - USD ($) $ / shares in Units, $ in Thousands | Aug. 01, 2016 | Aug. 31, 2015 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Earnings Per Share [Abstract] | |||||
Public offering related to equity forward transaction, shares | 8,600,000 | ||||
Forward rate per share | $ 25.25 | ||||
Shares subject to forward sale agreement | 4,300,000 | ||||
Optional shares available to underwriters | 1,290,000 | ||||
Stock issued during period, shares | 5,590,000 | ||||
Proceeds from issuance of common stock | $ 134,700 | $ 9,681 | $ 14,028 | $ 139,654 |
Quarterly Financial Informati_3
Quarterly Financial Information (Unaudited) (Unaudited Quarterly Results of Operations) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Premiums and product charges | $ 64,824 | $ 65,605 | $ 60,763 | $ 59,776 | $ 64,925 | $ 60,500 | $ 56,323 | $ 52,974 | |||
Net investment income | 554,355 | 549,391 | 533,282 | 510,784 | 512,709 | 500,202 | 493,489 | 485,597 | $ 2,147,812 | $ 1,991,997 | $ 1,849,872 |
Change in fair value of derivatives | (1,054,281) | 595,311 | 132,205 | (451,083) | 661,993 | 362,525 | 266,820 | 386,533 | (777,848) | 1,677,871 | 164,219 |
Net realized gains (losses) on investments, excluding OTTI losses | 3,097 | (2,196) | (38,381) | 302 | 2,719 | 1,579 | 3,873 | 2,338 | (37,178) | 10,509 | 11,524 |
Net OTTI losses recognized in operations | (18,980) | (14,373) | (2,396) | (907) | (3,076) | (464) | (949) | (141) | (36,656) | (4,630) | (22,679) |
Loss on extinguishment of debt | 0 | (18,389) | (428) | 0 | 0 | (18,817) | 0 | ||||
Total revenues | (450,985) | 1,193,738 | 685,473 | 118,872 | 1,239,270 | 905,953 | 819,128 | 927,301 | 1,547,098 | 3,891,652 | 2,220,282 |
Net income | $ 53,823 | $ 169,328 | $ 93,903 | $ 140,962 | $ 36,803 | $ 56,957 | $ 26,946 | $ 53,939 | $ 458,016 | $ 174,645 | $ 83,243 |
Earnings per common share | $ 0.59 | $ 1.87 | $ 1.04 | $ 1.57 | $ 0.41 | $ 0.64 | $ 0.30 | $ 0.61 | $ 5.07 | $ 1.96 | $ 0.98 |
Earnings per common share - assuming dilution | $ 0.59 | $ 1.85 | $ 1.03 | $ 1.55 | $ 0.41 | $ 0.63 | $ 0.30 | $ 0.60 | $ 5.01 | $ 1.93 | $ 0.97 |
Quarterly Financial Informati_4
Quarterly Financial Information (Unaudited) (Comparability of Net Income, Impact of Fair Value Accounting to Fixed Index Annuity Business) (Details) - USD ($) $ in Thousands | 3 Months Ended | |||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | ||||||||
Fixed index annuity derivatives, fair value accounting impact on comparability of net income | $ 28,298 | $ 427 | $ (23,593) | $ (61,794) | $ 3,518 | $ 30,806 | $ 37,075 | $ 7,069 |
Schedule I - Summary of Inves_2
Schedule I - Summary of Investments - Other Than Investments in Related Parties (Details) $ in Thousands | Dec. 31, 2018USD ($) | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | $ 49,871,428 | [1] |
Amount at which shown in the balance sheet | 49,427,498 | |
Total Fixed Maturity Securities | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 46,131,190 | [1] |
Fair value | 45,923,727 | |
Amount at which shown in the balance sheet | 45,923,727 | |
United States Government Full Faith and Credit | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 11,872 | [1] |
Fair value | 11,652 | |
Amount at which shown in the balance sheet | 11,652 | |
United States Government Sponsored Agencies | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 1,208,468 | [1] |
Fair value | 1,138,529 | |
Amount at which shown in the balance sheet | 1,138,529 | |
United States Municipalities, States and Territories | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 3,880,703 | [1] |
Fair value | 4,126,267 | |
Amount at which shown in the balance sheet | 4,126,267 | |
Foreign Government Obligations | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 226,860 | [1] |
Fair value | 230,274 | |
Amount at which shown in the balance sheet | 230,274 | |
Corporate Securities | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 28,483,138 | [1] |
Fair value | 28,371,514 | |
Amount at which shown in the balance sheet | 28,371,514 | |
Residential Mortgage Backed Securities | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 1,134,623 | [1] |
Fair value | 1,202,159 | |
Amount at which shown in the balance sheet | 1,202,159 | |
Commercial Mortgage Backed Securities | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 5,492,271 | [1] |
Fair value | 5,379,003 | |
Amount at which shown in the balance sheet | 5,379,003 | |
Other Asset Backed Securities | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 5,693,255 | [1] |
Fair value | 5,464,329 | |
Amount at which shown in the balance sheet | 5,464,329 | |
Mortgage Loans on Real Estate | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 2,943,091 | [1] |
Fair value | 2,920,612 | |
Amount at which shown in the balance sheet | 2,943,091 | |
Derivative Instruments | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 441,616 | [1] |
Fair value | 205,149 | |
Amount at which shown in the balance sheet | 205,149 | |
Other Investments | ||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | ||
Amortized cost | 355,531 | [1] |
Amount at which shown in the balance sheet | $ 355,531 | |
[1] | On the basis of cost adjusted for other than temporary impairments, repayments and amortization of premiums and accrual of discounts for fixed maturity securities and short-term investments, original cost for derivative instruments and unpaid principal balance less allowance for credit losses for mortgage loans. |
Schedule II - Condensed Finan_2
Schedule II - Condensed Financial Information of Registrant (Condensed Balance Sheets) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Assets | ||||
Cash and cash equivalents | $ 344,396 | $ 1,434,045 | $ 791,266 | $ 397,749 |
Deferred income taxes | 291,169 | 38,147 | ||
Other assets | 60,608 | 254,127 | ||
Total assets | 61,625,564 | 62,030,736 | ||
Liabilities: | ||||
Notes and loan payable | 494,591 | 494,093 | ||
Subordinated debentures payable to subsidiary trusts | 242,982 | 242,565 | ||
Federal income tax payable | 0 | 34,285 | ||
Other liabilities | 502,725 | 1,984,079 | ||
Total liabilities | 59,226,463 | 59,180,579 | ||
Stockholders' equity: | ||||
Common stock | 90,369 | 89,331 | ||
Additional paid-in capital | 811,186 | 791,446 | ||
Accumulated other comprehensive income (loss) | (52,432) | 724,599 | ||
Retained earnings | 1,549,978 | 1,244,781 | ||
Total stockholders' equity | 2,399,101 | 2,850,157 | 2,291,595 | 1,944,535 |
Total liabilities and stockholders' equity | 61,625,564 | 62,030,736 | ||
Parent Company | ||||
Assets | ||||
Cash and cash equivalents | 68,876 | 22,486 | $ 36,394 | $ 38,903 |
Equity securities of subsidiary trusts | 7,437 | 7,429 | ||
Receivable from subsidiaries | 1,170 | 166 | ||
Deferred income taxes | 7,905 | 7,945 | ||
Federal income tax recoverable, including amount from subsidiaries | 0 | 1,059 | ||
Other assets | 2,751 | 1,566 | ||
Total assets, excluding investment in and advances to subsidiaries | 88,139 | 40,651 | ||
Investment in and advances to subsidiaries | 3,066,039 | 3,550,405 | ||
Total assets | 3,154,178 | 3,591,056 | ||
Liabilities: | ||||
Notes and loan payable | 494,591 | 494,093 | ||
Subordinated debentures payable to subsidiary trusts | 242,982 | 242,565 | ||
Federal income tax payable | 8,892 | 0 | ||
Other liabilities | 8,612 | 4,241 | ||
Total liabilities | 755,077 | 740,899 | ||
Stockholders' equity: | ||||
Common stock | 90,369 | 89,331 | ||
Additional paid-in capital | 811,186 | 791,446 | ||
Accumulated other comprehensive income (loss) | (52,432) | 724,599 | ||
Retained earnings | 1,549,978 | 1,244,781 | ||
Total stockholders' equity | 2,399,101 | 2,850,157 | ||
Total liabilities and stockholders' equity | $ 3,154,178 | $ 3,591,056 |
Schedule II - Condensed Finan_3
Schedule II - Condensed Financial Information of Registrant (Condensed Statements of Operations) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues: | |||||||||||
Net investment income | $ 554,355 | $ 549,391 | $ 533,282 | $ 510,784 | $ 512,709 | $ 500,202 | $ 493,489 | $ 485,597 | $ 2,147,812 | $ 1,991,997 | $ 1,849,872 |
Change in fair value of derivatives | (1,054,281) | 595,311 | 132,205 | (451,083) | 661,993 | 362,525 | 266,820 | 386,533 | (777,848) | 1,677,871 | 164,219 |
Loss on extinguishment of debt | 0 | (18,389) | (428) | 0 | 0 | (18,817) | 0 | ||||
Total revenues | (450,985) | 1,193,738 | 685,473 | 118,872 | 1,239,270 | 905,953 | 819,128 | 927,301 | 1,547,098 | 3,891,652 | 2,220,282 |
Expenses: | |||||||||||
Interest expense on notes and loan payable | 25,498 | 30,368 | 28,248 | ||||||||
Interest expense on subordinated debentures issued to subsidiary trusts | 15,491 | 14,124 | 12,958 | ||||||||
Other operating costs and expenses | 129,301 | 111,691 | 102,231 | ||||||||
Total benefits and expenses | 981,356 | 3,575,381 | 2,090,035 | ||||||||
Income tax expense | 107,726 | 141,626 | 47,004 | ||||||||
Net income | $ 53,823 | $ 169,328 | $ 93,903 | $ 140,962 | $ 36,803 | $ 56,957 | $ 26,946 | $ 53,939 | 458,016 | 174,645 | 83,243 |
Parent Company | |||||||||||
Revenues: | |||||||||||
Net investment income | 773 | 492 | 78 | ||||||||
Dividends from subsidiary trusts | 461 | 410 | 384 | ||||||||
Dividends from dissolved subsidiaries | 10,393 | 0 | 0 | ||||||||
Surplus note interest from subsidiary | 4,080 | 4,080 | 4,080 | ||||||||
Change in fair value of derivatives | 1,051 | (412) | (810) | ||||||||
Loss on extinguishment of debt | 0 | (18,817) | 0 | ||||||||
Total revenues | 109,093 | 69,694 | 79,438 | ||||||||
Expenses: | |||||||||||
Interest expense on notes and loan payable | 25,498 | 30,368 | 28,248 | ||||||||
Interest expense on subordinated debentures issued to subsidiary trusts | 15,491 | 14,124 | 12,958 | ||||||||
Other operating costs and expenses | 18,579 | 9,234 | 8,551 | ||||||||
Total benefits and expenses | 59,568 | 53,726 | 49,757 | ||||||||
Income before income taxes and equity in undistributed income of subsidiaries | 49,525 | 15,968 | 29,681 | ||||||||
Income tax expense | 2,603 | 6,895 | 12,073 | ||||||||
Income before equity in undistributed income of subsidiaries | 46,922 | 9,073 | 17,608 | ||||||||
Equity in undistributed income of subsidiaries | 411,094 | 165,572 | 65,635 | ||||||||
Net income | 458,016 | 174,645 | 83,243 | ||||||||
Investment Advisory Fees | Parent Company | |||||||||||
Revenues: | |||||||||||
Investment advisory fees | $ 92,335 | $ 83,941 | $ 75,706 |
Schedule II - Condensed Finan_4
Schedule II - Condensed Financial Information of Registrant (Condensed Statements of Cash Flows) (Details) - USD ($) $ in Thousands | Aug. 01, 2016 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Operating activities | ||||||||||||
Net income | $ 53,823 | $ 169,328 | $ 93,903 | $ 140,962 | $ 36,803 | $ 56,957 | $ 26,946 | $ 53,939 | $ 458,016 | $ 174,645 | $ 83,243 | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
Accrual of discount on equity security | 19,204 | 15,431 | 1,070 | |||||||||
Change in fair value of derivatives | 777,575 | (1,678,956) | (165,727) | |||||||||
Loss on extinguishment of debt | 0 | $ 18,389 | $ 428 | 0 | 0 | 18,817 | 0 | |||||
Share-based compensation | 11,097 | 6,464 | 6,692 | |||||||||
Deferred income taxes | (12,563) | (46,730) | (10,408) | |||||||||
Changes in operating assets and liabilities: | ||||||||||||
Other assets | (844) | 448 | 1,812 | |||||||||
Other liabilities | (17,318) | (84,416) | (55,940) | |||||||||
Net cash provided by operating activities | 43,185 | 1,923,847 | 1,416,386 | |||||||||
Investing activities | ||||||||||||
Purchases of property, plant and equipment | (4,283) | (4,809) | (1,197) | |||||||||
Net cash used in investing activities | (2,408,331) | (2,593,390) | (4,501,109) | |||||||||
Financing activities | ||||||||||||
Financing fees incurred and deferred | 0 | (5,817) | (1,456) | |||||||||
Repayment of notes payable | 0 | (413,252) | 0 | |||||||||
Repayment of loan payable | 0 | (100,000) | 0 | |||||||||
Proceeds from issuance of notes payable | 0 | 499,650 | 0 | |||||||||
Proceeds from issuance of loan payable | 0 | 0 | 100,000 | |||||||||
Proceeds from issuance of common stock | $ 134,700 | 9,681 | 14,028 | 139,654 | ||||||||
Dividends paid | (25,265) | (23,148) | (21,110) | |||||||||
Net cash provided by (used in) financing activities | 1,275,497 | 1,312,322 | 3,478,240 | |||||||||
Increase (decrease) in cash and cash equivalents | (1,089,649) | 642,779 | 393,517 | |||||||||
Cash and cash equivalents at beginning of year | 1,434,045 | 791,266 | 1,434,045 | 791,266 | 397,749 | |||||||
Cash and cash equivalents at end of year | 344,396 | 1,434,045 | 344,396 | 1,434,045 | 791,266 | |||||||
Cash paid during the year for interest: | ||||||||||||
Interest paid | 39,575 | 55,445 | 39,647 | |||||||||
Non-cash financing activity: | ||||||||||||
Common stock issued to settle warrants that have expired | 0 | 0 | 93 | |||||||||
Parent Company | ||||||||||||
Operating activities | ||||||||||||
Net income | 458,016 | 174,645 | 83,243 | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
Provision for depreciation and amortization | 916 | 1,610 | 1,946 | |||||||||
Accrual of discount on equity security | (8) | (7) | (7) | |||||||||
Equity in undistributed income of subsidiaries | (411,094) | (165,572) | (65,635) | |||||||||
Change in fair value of derivatives | (1,325) | (657) | (698) | |||||||||
Loss on extinguishment of debt | 0 | 18,817 | 0 | |||||||||
Accrual of discount on debenture issued to subsidiary trust | 254 | 236 | 221 | |||||||||
Share-based compensation | 1,626 | 951 | 818 | |||||||||
Deferred income taxes | 40 | 1,583 | 2,117 | |||||||||
Changes in operating assets and liabilities: | ||||||||||||
Receivable from subsidiaries | (1,004) | 16 | (125) | |||||||||
Federal income tax recoverable/payable | 9,951 | (4,673) | 11,361 | |||||||||
Other assets | (229) | 158 | (326) | |||||||||
Other liabilities | 4,860 | (12,427) | 2,546 | |||||||||
Net cash provided by operating activities | 62,003 | 14,680 | 35,461 | |||||||||
Investing activities | ||||||||||||
Capital contributions to subsidiaries | 0 | 0 | (255,000) | |||||||||
Purchases of property, plant and equipment | (29) | (45) | (54) | |||||||||
Net cash used in investing activities | (29) | (45) | (255,054) | |||||||||
Financing activities | ||||||||||||
Financing fees incurred and deferred | 0 | (5,817) | (1,456) | |||||||||
Repayment of notes payable | 0 | (413,252) | 0 | |||||||||
Repayment of loan payable | 0 | (100,000) | 0 | |||||||||
Proceeds from issuance of notes payable | 0 | 499,650 | 0 | |||||||||
Proceeds from issuance of loan payable | 0 | 0 | 100,000 | |||||||||
Proceeds from issuance of common stock | 9,681 | 14,028 | 139,654 | |||||||||
Dividends paid | (25,265) | (23,152) | (21,114) | |||||||||
Net cash provided by (used in) financing activities | (15,584) | (28,543) | 217,084 | |||||||||
Increase (decrease) in cash and cash equivalents | 46,390 | (13,908) | (2,509) | |||||||||
Cash and cash equivalents at beginning of year | $ 22,486 | $ 36,394 | 22,486 | 36,394 | 38,903 | |||||||
Cash and cash equivalents at end of year | $ 68,876 | $ 22,486 | 68,876 | 22,486 | 36,394 | |||||||
Non-cash financing activity: | ||||||||||||
Common stock issued to settle warrants that have expired | 0 | 0 | 93 | |||||||||
Parent Company | Notes and Loans Payable | ||||||||||||
Cash paid during the year for interest: | ||||||||||||
Interest paid | 25,000 | 40,537 | 27,164 | |||||||||
Parent Company | Subordinated Debentures | ||||||||||||
Cash paid during the year for interest: | ||||||||||||
Interest paid | $ 13,593 | $ 14,573 | $ 12,454 |
Schedule III - Supplementary _2
Schedule III - Supplementary Insurance Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
SEC Schedule, 12-16, Insurance Companies, Supplementary Insurance Information [Abstract] | |||
Deferred policy acquisition costs | $ 3,535,838 | $ 2,714,523 | $ 2,905,377 |
Future policy benefits, losses, claims and loss expenses | 57,606,009 | 56,142,673 | 51,637,026 |
Unearned premiums | 0 | 0 | 0 |
Other policy claims and benefits payable | 270,858 | 282,884 | 298,347 |
Premium revenue | 250,968 | 234,722 | 217,346 |
Net investment income | 2,147,812 | 1,991,997 | 1,849,872 |
Benefits, claims, losses and settlement expenses | 483,075 | 3,163,234 | 1,572,586 |
Amortization of deferred policy acquisition costs | 327,991 | 255,964 | 374,012 |
Other operating expenses | $ 170,290 | $ 156,183 | $ 143,437 |
Schedule IV - Reinsurance (Deta
Schedule IV - Reinsurance (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||
Gross amount, life insurance in force | $ 64,544 | $ 1,942,129 | $ 1,996,446 |
Ceded to other companies, life insurance in force | 7,832 | 9,378 | 10,045 |
Assumed from other companies, life insurance in force | 53,658 | 57,965 | 57,849 |
Net amount, life insurance in force | 110,370 | 1,990,716 | 2,044,250 |
Net amount, insurance premiums and other considerations | $ 26,480 | $ 34,228 | $ 43,767 |
Percent of amount assumed to net, life insurance in force | 48.62% | 2.91% | 2.83% |
Insurance Premiums and Other Considerations | |||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||
Gross amount, insurance premiums and other considerations | $ 257,881 | $ 240,890 | $ 222,466 |
Ceded to other companies, insurance premiums and other considerations | 7,263 | 6,673 | 5,617 |
Assumed from other companies, insurance premiums and other considerations | 350 | 505 | 497 |
Net amount, insurance premiums and other considerations | $ 250,968 | $ 234,722 | $ 217,346 |
Percent of amount assumed to net, insurance premiums and other considerations | 0.14% | 0.22% | 0.23% |
Fixed Index Annuities | |||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||
Gross amount, insurance premiums and other considerations | $ 231,562 | $ 206,952 | $ 178,945 |
Ceded to other companies, insurance premiums and other considerations | 7,074 | 6,458 | 5,366 |
Assumed from other companies, insurance premiums and other considerations | 0 | 0 | 0 |
Net amount, insurance premiums and other considerations | $ 224,488 | $ 200,494 | $ 173,579 |
Percent of amount assumed to net, insurance premiums and other considerations | 0.00% | 0.00% | 0.00% |
Traditional Life, Accident and Health Insurance, and Life Contingent Immediate Annuity Premiums | |||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||
Gross amount, insurance premiums and other considerations | $ 26,319 | $ 33,938 | $ 43,521 |
Ceded to other companies, insurance premiums and other considerations | 189 | 215 | 251 |
Assumed from other companies, insurance premiums and other considerations | 350 | 505 | 497 |
Net amount, insurance premiums and other considerations | $ 26,480 | $ 34,228 | $ 43,767 |
Percent of amount assumed to net, insurance premiums and other considerations | 1.32% | 1.48% | 1.14% |
Schedule V - Valuation and Qu_2
Schedule V - Valuation and Qualifying Accounts (Details) - Valuation Allowance on Mortgage Loans - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning balance | $ (7,518) | $ (8,427) | $ (14,142) |
Charged to costs and expenses | (3,165) | 278 | (4,846) |
Translation adjustment | 0 | 0 | 0 |
Write-offs/payments/other | 2,444 | 631 | 10,561 |
Ending balance | $ (8,239) | $ (7,518) | $ (8,427) |