Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | 8-May-15 |
Document And Entity Information | ||
Entity Registrant Name | PHOENIX COMPANIES INC/DE | |
Entity Central Index Key | 1129633 | |
Document Type | 10-Q | |
Document Period End Date | 31-Mar-15 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -19 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 5.8 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2015 |
Consolidated_Interim_Unaudited
Consolidated Interim Unaudited Balance Sheets (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
ASSETS: | ||
Available-for-sale debt securities, at fair value (amortized cost of $12,140.1 and $11,978.0) | $12,985.30 | $12,679.30 |
Available-for-sale equity securities, at fair value (cost of $154.5 and $156.0) | 175.5 | 179.5 |
Short-term investments | 154.7 | 149.7 |
Limited partnerships and other investments | 541.7 | 542.8 |
Policy loans, at unpaid principal balances | 2,363.90 | 2,352.10 |
Derivative instruments | 140.2 | 161.3 |
Fair value investments | 250.8 | 235.4 |
Total investments | 16,612.10 | 16,300.10 |
Cash and cash equivalents | 347.5 | 450 |
Accrued investment income | 181.2 | 176.7 |
Reinsurance recoverable | 600.3 | 559.1 |
Deferred policy acquisition costs | 836.5 | 848.6 |
Deferred income taxes, net | 28.7 | 34.2 |
Other assets | 311.9 | 311.3 |
Discontinued operations assets | 45.6 | 45.2 |
Separate account assets | 2,969.40 | 3,020.70 |
Total assets | 21,933.20 | 21,745.90 |
LIABILITIES: | ||
Policy liabilities and accruals | 12,496.80 | 12,417.60 |
Policyholder deposit funds | 4,084.60 | 3,955 |
Dividend obligations | 977.2 | 916.8 |
Indebtedness | 378.9 | 378.9 |
Pension and post-employment liabilities | 376.9 | 380 |
Other liabilities | 336.2 | 289.8 |
Discontinued operations liabilities | 40.6 | 40.5 |
Separate account liabilities | 2,969.40 | 3,020.70 |
Total liabilities | 21,660.60 | 21,399.30 |
CONTINGENCIES AND COMMITMENTS (Notes 20 & 21) | ||
STOCKHOLDERS’ EQUITY: | ||
Common stock, $.01 par value: 5.8 million and 5.8 million shares outstanding | 0.1 | 0.1 |
Additional paid-in capital | 2,632.80 | 2,632.80 |
Accumulated other comprehensive income (loss) | -236.6 | -234.4 |
Retained earnings (accumulated deficit) | -1,963 | -1,889 |
Treasury stock, at cost: 0.7 million and 0.7 million shares | -182.9 | -182.9 |
Total The Phoenix Companies, Inc. stockholders’ equity | 250.4 | 326.6 |
Noncontrolling interests | 22.2 | 20 |
Total stockholders’ equity | 272.6 | 346.6 |
Total liabilities and stockholders’ equity | $21,933.20 | $21,745.90 |
Consolidated_Interim_Unaudited1
Consolidated Interim Unaudited Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, except Per Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ||
Available-for-sale debt securities, amortized cost | $12,140.10 | $11,978 |
Available-for-sale equity securities, at cost | $154.50 | $156 |
Common stock par value (USD per share) | $0.01 | $0.01 |
Shares outstanding (in shares) | 5.8 | 5.8 |
Treasury stock (in shares) | 0.7 | 0.7 |
Consolidated_Interim_Unaudited2
Consolidated Interim Unaudited Statements of Income and Comprehensive Income (USD $) | 3 Months Ended | |
In Millions, except Share data in Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
REVENUES: | ||
Premiums | $78.40 | $79.60 |
Fee income | 133.8 | 134.8 |
Net investment income | 209.3 | 211.5 |
Net realized gains (losses): | ||
Total other-than-temporary impairment (“OTTIâ€) losses | -7 | 0 |
Portion of OTTI losses recognized in other comprehensive income (“OCIâ€) | -1.4 | -0.2 |
Net OTTI losses recognized in earnings | -8.4 | -0.2 |
Net realized gains (losses), excluding OTTI losses | -7.7 | -26.7 |
Net realized gains (losses) | -16.1 | -26.9 |
Total revenues | 405.4 | 399 |
BENEFITS AND EXPENSES: | ||
Policy benefits | 292 | 230.3 |
Policyholder dividends | 40.1 | 72.2 |
Policy acquisition cost amortization | 17.1 | 24.6 |
Interest expense on indebtedness | 7.1 | 7.1 |
Other operating expenses | 123.8 | 97.2 |
Total benefits and expenses | 480.1 | 431.4 |
Income (loss) from continuing operations before income taxes | -74.7 | -32.4 |
Income tax expense (benefit) | -2.2 | -4.8 |
Income (loss) from continuing operations | -72.5 | -27.6 |
Income (loss) from discontinued operations, net of income taxes | -0.5 | -0.6 |
Net income (loss) | -73 | -28.2 |
Less: Net income (loss) attributable to noncontrolling interests | 1 | -0.1 |
Net income (loss) attributable to The Phoenix Companies, Inc. | -74 | -28.1 |
COMPREHENSIVE INCOME (LOSS): | ||
Net income (loss) attributable to The Phoenix Companies, Inc. | -74 | -28.1 |
Net income (loss) attributable to noncontrolling interests | 1 | -0.1 |
Net income (loss) | -73 | -28.2 |
Other comprehensive income (loss) before income taxes: | ||
Unrealized investment gains (losses), net of related offsets | 3.4 | 23.7 |
Net pension liability adjustment | 1.4 | 1.7 |
Other comprehensive income (loss) before income taxes | 4.8 | 25.4 |
Less: Income tax expense (benefit) related to: | ||
Unrealized investment gains (losses), net of related offsets | 7 | 32.7 |
Net pension liability adjustment | 0 | 0 |
Total income tax expense (benefit) | 7 | 32.7 |
Other comprehensive income (loss), net of income taxes | -2.2 | -7.3 |
Comprehensive income (loss) | -75.2 | -35.5 |
Less: Comprehensive income (loss) attributable to noncontrolling interests | 1 | -0.1 |
Comprehensive income (loss) attributable to The Phoenix Companies, Inc. | ($76.20) | ($35.40) |
EARNINGS (LOSS) PER SHARE: | ||
Income (loss) from continuing operations – basic (USD per share) | ($12.78) | ($4.79) |
Income (loss) from continuing operations – diluted (USD per share) | ($12.78) | ($4.79) |
Income (loss) from discontinued operations – basic (USD per share) | ($0.09) | ($0.10) |
Income (loss) from discontinued operations – diluted (USD per share) | ($0.09) | ($0.10) |
Net income (loss) attributable to The Phoenix Companies, Inc.– basic (USD per share) | ($12.87) | ($4.89) |
Net income (loss) attributable to The Phoenix Companies, Inc. – diluted (USD per share) | ($12.87) | ($4.89) |
Basic weighted-average common shares outstanding (in shares) | 5,751 | 5,742 |
Weighted-average common shares outstanding, including dilutive potential common shares | 5,751 | 5,742 |
Consolidated_Interim_Unaudited3
Consolidated Interim Unaudited Statements of Cash Flows (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
OPERATING ACTIVITIES: | ||
Net income (loss) | ($74) | ($28.10) |
Net realized gains / losses | 13.6 | 26.9 |
Policy acquisition costs deferred | -21.8 | -14.6 |
Policy acquisition cost amortization | 17.1 | 24.6 |
Amortization and depreciation | 1.4 | 1.5 |
Interest credited | 38.2 | 35.6 |
Equity in earnings of limited partnerships and other investments | -13 | -20.1 |
Change in: | ||
Accrued investment income | -49.8 | -44 |
Deferred income taxes, net | -1.5 | -8.3 |
Reinsurance recoverable | -41.3 | -12.9 |
Policy liabilities and accruals | -77.3 | -142.6 |
Dividend obligations | -2.4 | 30.2 |
Pension and post-employment liabilities | -1.7 | -4.9 |
Impact of operating activities of consolidated investment entities, net | -10.8 | -6.7 |
Other operating activities, net | 47.2 | 23.1 |
Cash provided by (used for) operating activities | -176.1 | -140.3 |
Purchases of: | ||
Available-for-sale debt securities | -530.6 | -338.4 |
Available-for-sale equity securities | -7.1 | -1.8 |
Short-term investments | -274.5 | -649.3 |
Derivative instruments | -17.5 | -17.8 |
Fair value and other investments | -0.6 | -0.3 |
Sales, repayments and maturities of: | ||
Available-for-sale debt securities | 393.1 | 338.7 |
Available-for-sale equity securities | 4.7 | 3.1 |
Short-term investments | 269.5 | 489.8 |
Derivative instruments | 19.8 | 42.1 |
Fair value and other investments | 1.9 | 2.8 |
Contributions to limited partnerships and limited liability corporations | -19.5 | -18.2 |
Distributions from limited partnerships and limited liability corporations | 33.4 | 30.3 |
Policy loans, net | 24.4 | 32 |
Impact of investing activities of consolidated investment entities, net | 0 | 0 |
Other investing activities, net | 2.8 | -2 |
Cash provided by (used for) investing activities | -100.2 | -89 |
FINANCING ACTIVITIES: | ||
Policyholder deposits | 373.2 | 361.3 |
Policyholder withdrawals | -295.6 | -321.5 |
Net transfers (to) from separate accounts | 94.6 | 118.2 |
Impact of financing activities of consolidated investment entities, net | 1.2 | 0.1 |
Other financing activities, net | 0 | 0 |
Cash provided by (used for) financing activities | 173.4 | 158.1 |
Change in cash and cash equivalents | -102.9 | -71.2 |
Change in cash included in discontinued operations assets | 0.4 | -0.7 |
Cash and cash equivalents, beginning of period | 450 | 496.4 |
Cash and cash equivalents, end of period | 347.5 | 424.5 |
Supplemental Disclosure of Cash Flow Information | ||
Income taxes (paid) refunded | -6.6 | 0 |
Interest expense on indebtedness paid | -4.7 | -4.7 |
Non-Cash Transactions During the Period | ||
Investment exchanges | $20 | $13 |
Consolidated_Interim_Unaudited4
Consolidated Interim Unaudited Statements of Changes in Stockholders' Equity (USD $) | Total | COMMON STOCK: | ADDITIONAL PAID-IN CAPITAL: | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | ACCUMULATED DEFICIT: | TREASURY STOCK, AT COST: | TOTAL STOCKHOLDERS’ EQUITY ATTRIBUTABLE TO THE PHOENIX COMPANIES,INC.: | NONCONTROLLING INTERESTS: |
In Millions, unless otherwise specified | ||||||||
Balance, beginning of period at Dec. 31, 2013 | $601.30 | $0.10 | $2,633.10 | ($185) | ($1,675.80) | ($182.90) | $589.50 | $11.80 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of shares and compensation expense on stock compensation awards | 0 | |||||||
Other comprehensive income (loss) | -7.3 | -7.3 | ||||||
Net income (loss) | -28.1 | -28.1 | ||||||
Less: Net income (loss) attributable to noncontrolling interests | -0.1 | -0.1 | ||||||
Change in equity of noncontrolling interests | 0.1 | |||||||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | -35.4 | -35.4 | 0.1 | |||||
Balance, end of period at Mar. 31, 2014 | 565.9 | 0.1 | 2,633.10 | -192.3 | -1,703.90 | -182.9 | 554.1 | 11.8 |
Balance, beginning of period at Dec. 31, 2014 | 346.6 | 0.1 | 2,632.80 | -234.4 | -1,889 | -182.9 | 326.6 | 20 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of shares and compensation expense on stock compensation awards | 0 | |||||||
Other comprehensive income (loss) | -2.2 | -2.2 | ||||||
Net income (loss) | -74 | -74 | ||||||
Less: Net income (loss) attributable to noncontrolling interests | 1 | 1 | ||||||
Change in equity of noncontrolling interests | 1.2 | |||||||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | -74 | -76.2 | ||||||
Balance, end of period at Mar. 31, 2015 | $272.60 | $0.10 | $2,632.80 | ($236.60) | ($1,963) | ($182.90) | $250.40 | $22.20 |
Organization_and_Description_o
Organization and Description of Business | 3 Months Ended |
Mar. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Organization and Description of Business |
The Phoenix Companies, Inc. (“we,” “our,” “us,” the “Company,” “PNX” or “Phoenix”) is a holding company and our operations are conducted through subsidiaries, principally Phoenix Life Insurance Company (“Phoenix Life”) and PHL Variable Insurance Company (“PHL Variable”), collectively with Phoenix Life and Phoenix Life and Annuity Company and American Phoenix Life and Reassurance (our “Life Companies”). We provide life insurance and annuity products through independent agents and financial advisors. Our policyholder base includes both affluent and middle market consumers, with our more recent business concentrated in the middle market. Most of our life insurance in force is permanent life insurance insuring one or more lives. Our annuity products include fixed and variable annuities with a variety of death benefit and guaranteed living benefit options. | |
We operate two businesses segments: Life and Annuity and Saybrus Partners, Inc. (“Saybrus”). The Life and Annuity segment includes individual life insurance and annuity products, including our closed block. Saybrus provides dedicated life insurance and other consulting services to financial advisors in partner companies, as well as support for sales of Phoenix’s product line through independent distribution organizations. |
Revision_of_Previously_Reporte
Revision of Previously Reported Financial Statements | 3 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Accounting Changes and Error Corrections [Abstract] | ||||||||||||||||
Revision of Previously Reported Financial Statements | Revision of Previously Reported Financial Statements | |||||||||||||||
In the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, which was filed with the SEC on March 31, 2015 (the “2014 Form 10-K”), the Company restated its financial statements for the year ended December 31, 2013, the three-months ended December 31, 2013, and the three-months ended June 30, 2014 and revised its financial statements for all other periods presented. The 2014 Form 10-K was filed by the Company in lieu of the Company separately filing with the SEC amendments to its previously filed Annual Reports on Form 10-K for the year ended December 31, 2013 and its previously filed Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, June 30 and September 30, 2014, and March 31, June 30 and September 30, 2013. | ||||||||||||||||
The unaudited financial statements for the three month period ended March 31, 2014 contained in this Form 10-Q are presented on a revised basis, consistent with revised financial statements for the three month period ended March 31, 2014 contained in the 2014 Form 10-K. As discussed in the 2014 Form 10-K, the Company has revised its consolidated financial statements as of and for the comparative three months ended March 31, 2014 to adjust for the impact of errors identified, including the recording of previously identified out-of-period errors that were previously determined not to be material individually, or in the aggregate, in the appropriate period. | ||||||||||||||||
The Company has classified the correction of errors into two categories (i) UL Unlock and (ii) Other Adjustments as detailed more fully below: | ||||||||||||||||
UL Unlock | ||||||||||||||||
In accordance with U.S. GAAP and our accounting policy, the Company performs an annual assumption review where management makes a determination of the best estimate assumptions to be used based on a comprehensive review of recent experience studies and industry trends each year. In 2013, the Company revised a number of assumptions, the most significant of which resulted in changes to expected premium persistency and incorporation of mortality improvement in its UL business. The incorporation of these changes resulted in manual updates to various models for which certain errors were subsequently identified in the course of performing analysis between the fourth quarter of 2014 and the prior period results. These errors related to inappropriate implementation of data used in the calculation of certain product features which then resulted in the incorrect calculation of the ultimate impact of the Unlock for the fourth quarter of 2013. | ||||||||||||||||
Other Adjustments | ||||||||||||||||
Amounts primarily relate to various out-of-period errors identified which were previously determined not to be material individually or in the aggregate except to the quarter ended June 30, 2014 as noted more fully above. The Company considered the impacts of each of these errors, many of which were previously identified and subsequently recorded as out-of-period adjustments, as well as subsequently identified errors both individually and in the aggregate during the course of this restatement and concluded that none were significant for individual categorization herein. | ||||||||||||||||
The impact of the correction of these errors on the consolidated financial statements for the three months ended March 31, 2014 is presented in the following tables within this Note below. | ||||||||||||||||
($ in millions, except share data) | Consolidated Statement of Income and Comprehensive Income | |||||||||||||||
For the three months ended March 31, 2014 | ||||||||||||||||
Correction of errors | ||||||||||||||||
As | UL | Other | As | |||||||||||||
reported | unlock | adjustments | revised | |||||||||||||
REVENUES: | ||||||||||||||||
Premiums | $ | 79.6 | $ | — | $ | — | $ | 79.6 | ||||||||
Fee income | 134.8 | — | — | 134.8 | ||||||||||||
Net investment income | 213.5 | — | (2.0 | ) | 211.5 | |||||||||||
Net realized gains (losses): | ||||||||||||||||
Total other-than-temporary impairment (“OTTI”) losses | — | — | — | — | ||||||||||||
Portion of OTTI losses recognized in other comprehensive income (“OCI”) | (0.2 | ) | — | — | (0.2 | ) | ||||||||||
Net OTTI losses recognized in earnings | (0.2 | ) | — | — | (0.2 | ) | ||||||||||
Net realized gains (losses), excluding OTTI losses | (25.5 | ) | — | (1.2 | ) | (26.7 | ) | |||||||||
Net realized gains (losses) | (25.7 | ) | — | (1.2 | ) | (26.9 | ) | |||||||||
Total revenues | 402.2 | — | (3.2 | ) | 399 | |||||||||||
BENEFITS AND EXPENSES: | ||||||||||||||||
Policy benefits | 236 | (0.7 | ) | (5.0 | ) | 230.3 | ||||||||||
Policyholder dividends | 73.8 | — | (1.6 | ) | 72.2 | |||||||||||
Policy acquisition cost amortization | 22.4 | — | 2.2 | 24.6 | ||||||||||||
Interest expense on indebtedness | 7.1 | — | — | 7.1 | ||||||||||||
Other operating expenses | 97.9 | — | (0.7 | ) | 97.2 | |||||||||||
Total benefits and expenses | 437.2 | (0.7 | ) | (5.1 | ) | 431.4 | ||||||||||
Income (loss) from continuing operations before income taxes | (35.0 | ) | 0.7 | 1.9 | (32.4 | ) | ||||||||||
Income tax expense (benefit) | (3.6 | ) | — | (1.2 | ) | (4.8 | ) | |||||||||
Income (loss) from continuing operations | (31.4 | ) | 0.7 | 3.1 | (27.6 | ) | ||||||||||
Income (loss) from discontinued operations, net of income taxes | (0.9 | ) | — | 0.3 | (0.6 | ) | ||||||||||
Net income (loss) | (32.3 | ) | 0.7 | 3.4 | (28.2 | ) | ||||||||||
Less: Net income (loss) attributable to noncontrolling interests | 1 | — | (1.1 | ) | (0.1 | ) | ||||||||||
Net income (loss) attributable to The Phoenix Companies, Inc. | $ | (33.3 | ) | $ | 0.7 | $ | 4.5 | $ | (28.1 | ) | ||||||
(Continued on next page) | ||||||||||||||||
(Continued from previous page) | Consolidated Statements of Income and Comprehensive Income | |||||||||||||||
($ in millions, except share data) | For the three months ended March 31, 2014 | |||||||||||||||
Correction of errors | ||||||||||||||||
As | UL | Other | As | |||||||||||||
reported | unlock | adjustments | revised | |||||||||||||
COMPREHENSIVE INCOME (LOSS): | ||||||||||||||||
Net income (loss) attributable to The Phoenix Companies, Inc. | $ | (33.3 | ) | $ | 0.7 | $ | 4.5 | $ | (28.1 | ) | ||||||
Net income (loss) attributable to noncontrolling interests | 1 | — | (1.1 | ) | (0.1 | ) | ||||||||||
Net income (loss) | (32.3 | ) | 0.7 | 3.4 | (28.2 | ) | ||||||||||
Other comprehensive income (loss) before income taxes: | ||||||||||||||||
Unrealized investment gains (losses), net of related offsets | 16.9 | 0.8 | 6 | 23.7 | ||||||||||||
Net pension liability adjustment | 1.6 | — | 0.1 | 1.7 | ||||||||||||
Other comprehensive income (loss) before income taxes | 18.5 | 0.8 | 6.1 | 25.4 | ||||||||||||
Less: Income tax expense (benefit) related to: | ||||||||||||||||
Unrealized investment gains (losses), net of related offsets | 28.7 | — | 4 | 32.7 | ||||||||||||
Net pension liability adjustment | — | — | — | — | ||||||||||||
Total income tax expense (benefit) | 28.7 | — | 4 | 32.7 | ||||||||||||
Other comprehensive income (loss), net of income taxes | (10.2 | ) | 0.8 | 2.1 | (7.3 | ) | ||||||||||
Comprehensive income (loss) | (42.5 | ) | 1.5 | 5.5 | (35.5 | ) | ||||||||||
Less: Comprehensive income (loss) attributable to noncontrolling interests | 1 | — | (1.1 | ) | (0.1 | ) | ||||||||||
Comprehensive income (loss) attributable to The Phoenix Companies, Inc. | $ | (43.5 | ) | $ | 1.5 | $ | 6.6 | $ | (35.4 | ) | ||||||
EARNINGS (LOSS) PER SHARE: | ||||||||||||||||
Income (loss) from continuing operations – basic | $ | (5.47 | ) | $ | 0.12 | $ | 0.73 | $ | (4.79 | ) | ||||||
Income (loss) from continuing operations – diluted | $ | (5.47 | ) | $ | 0.12 | $ | 0.73 | $ | (4.79 | ) | ||||||
Income (loss) from discontinued operations – basic | $ | (0.16 | ) | $ | — | $ | 0.05 | $ | (0.10 | ) | ||||||
Income (loss) from discontinued operations – diluted | $ | (0.16 | ) | $ | — | $ | 0.05 | $ | (0.10 | ) | ||||||
Net income (loss) attributable to The Phoenix Companies, Inc.– basic | $ | (5.80 | ) | $ | 0.12 | $ | 0.78 | $ | (4.89 | ) | ||||||
Net income (loss) attributable to The Phoenix Companies, Inc. – diluted | $ | (5.80 | ) | $ | 0.12 | $ | 0.78 | $ | (4.89 | ) | ||||||
Basic weighted-average common shares outstanding (in thousands) | 5,742 | 5,742 | ||||||||||||||
Diluted weighted-average common shares outstanding (in thousands) | 5,742 | 5,742 | ||||||||||||||
($ in millions) | Consolidated Statement of Cash Flows | |||||||||||||||
For the period ended March 31, 2014 | ||||||||||||||||
As | Correction | As | ||||||||||||||
reported | of errors | revised | ||||||||||||||
OPERATING ACTIVITIES: | ||||||||||||||||
Net income (loss) | $ | (33.3 | ) | $ | 5.2 | $ | (28.1 | ) | ||||||||
Net realized gains / losses | 25.7 | 1.2 | 26.9 | |||||||||||||
Policy acquisition costs deferred | (14.4 | ) | (0.2 | ) | (14.6 | ) | ||||||||||
Policy acquisition cost amortization | 22.4 | 2.2 | 24.6 | |||||||||||||
Amortization and depreciation | 1.5 | — | 1.5 | |||||||||||||
Interest credited | 35.6 | — | 35.6 | |||||||||||||
Equity in earnings of limited partnerships and other investments | (23.8 | ) | 3.7 | (20.1 | ) | |||||||||||
Change in: | ||||||||||||||||
Accrued investment income | (43.3 | ) | (0.7 | ) | (44.0 | ) | ||||||||||
Deferred income taxes, net | (6.1 | ) | (2.2 | ) | (8.3 | ) | ||||||||||
Reinsurance recoverable | (12.2 | ) | (0.7 | ) | (12.9 | ) | ||||||||||
Policy liabilities and accruals | (137.6 | ) | (5.0 | ) | (142.6 | ) | ||||||||||
Dividend obligations | 31.8 | (1.6 | ) | 30.2 | ||||||||||||
Pension and post-employment liabilities | (4.9 | ) | — | (4.9 | ) | |||||||||||
Impact of operating activities of consolidated investment entities, net | (5.6 | ) | (1.1 | ) | (6.7 | ) | ||||||||||
Other operating activities, net | 23.9 | (0.8 | ) | 23.1 | ||||||||||||
Cash provided by (used for) operating activities | (140.3 | ) | — | (140.3 | ) | |||||||||||
INVESTING ACTIVITIES: | ||||||||||||||||
Purchases of: | ||||||||||||||||
Available-for-sale debt securities | (338.5 | ) | 0.1 | (338.4 | ) | |||||||||||
Available-for-sale equity securities | (1.7 | ) | (0.1 | ) | (1.8 | ) | ||||||||||
Short-term investments | (649.3 | ) | — | (649.3 | ) | |||||||||||
Derivative instruments | (17.8 | ) | — | (17.8 | ) | |||||||||||
Fair value and other investments | (0.3 | ) | — | (0.3 | ) | |||||||||||
Sales, repayments and maturities of: | ||||||||||||||||
Available-for-sale debt securities | 338.8 | (0.1 | ) | 338.7 | ||||||||||||
Available-for-sale equity securities | 3 | 0.1 | 3.1 | |||||||||||||
Short-term investments | 489.8 | — | 489.8 | |||||||||||||
Derivative instruments | 42.1 | — | 42.1 | |||||||||||||
Fair value and other investments | 2.8 | — | 2.8 | |||||||||||||
Contributions to limited partnerships and limited liability corporations | (18.2 | ) | — | (18.2 | ) | |||||||||||
Distributions from limited partnerships and limited liability corporations | 30.3 | — | 30.3 | |||||||||||||
Policy loans, net | 32 | — | 32 | |||||||||||||
Impact of investing activities of consolidated investment entities, net | — | — | — | |||||||||||||
Other investing activities, net | (2.0 | ) | — | (2.0 | ) | |||||||||||
Cash provided by (used for) investing activities | (89.0 | ) | — | (89.0 | ) | |||||||||||
(Continued on next page) | ||||||||||||||||
(Continued from previous page) | Consolidated Statement of Cash Flows | |||||||||||||||
($ in millions, except share data) | For the period ended March 31, 2014 | |||||||||||||||
As | Correction | As | ||||||||||||||
reported | of errors | revised | ||||||||||||||
FINANCING ACTIVITIES: | ||||||||||||||||
Policyholder deposits | 361.3 | — | 361.3 | |||||||||||||
Policyholder withdrawals | (321.5 | ) | — | (321.5 | ) | |||||||||||
Net transfers (to) from separate accounts | 118.2 | — | 118.2 | |||||||||||||
Impact of financing activities of consolidated investment entities, net | 0.1 | — | 0.1 | |||||||||||||
Other financing activities, net | — | — | — | |||||||||||||
Cash provided by (used for) financing activities | 158.1 | — | 158.1 | |||||||||||||
Change in cash and cash equivalents | (71.2 | ) | — | (71.2 | ) | |||||||||||
Change in cash included in discontinued operations assets | (0.7 | ) | — | (0.7 | ) | |||||||||||
Cash and cash equivalents, beginning of period | 496.4 | — | 496.4 | |||||||||||||
Cash and cash equivalents, end of period | $ | 424.5 | $ | — | $ | 424.5 | ||||||||||
Supplemental Disclosure of Cash Flow Information | ||||||||||||||||
Income taxes (paid) refunded | $ | — | $ | — | $ | — | ||||||||||
Interest expense on indebtedness paid | $ | (4.7 | ) | $ | — | $ | (4.7 | ) | ||||||||
Non-Cash Transactions During the Period | ||||||||||||||||
Investment exchanges | $ | 13 | $ | — | $ | 13 | ||||||||||
($ in millions) | Consolidated Statement of | |||||||||||||||
Changes in Stockholders' Equity | ||||||||||||||||
For the period ended March 31, 2014 | ||||||||||||||||
As | Correction | As | ||||||||||||||
reported | of errors | revised | ||||||||||||||
COMMON STOCK: | ||||||||||||||||
Balance, beginning of period | $ | 0.1 | $ | — | $ | 0.1 | ||||||||||
Balance, end of period | $ | 0.1 | $ | — | $ | 0.1 | ||||||||||
ADDITIONAL PAID-IN CAPITAL: | ||||||||||||||||
Balance, beginning of period | $ | 2,633.10 | $ | — | $ | 2,633.10 | ||||||||||
Issuance of shares and compensation expense on stock compensation awards | — | — | — | |||||||||||||
Balance, end of period | $ | 2,633.10 | $ | — | $ | 2,633.10 | ||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | ||||||||||||||||
Balance, beginning of period | $ | (185.2 | ) | $ | 0.2 | $ | (185.0 | ) | ||||||||
Other comprehensive income (loss) | (10.2 | ) | 2.9 | (7.3 | ) | |||||||||||
Balance, end of period | $ | (195.4 | ) | $ | 3.1 | $ | (192.3 | ) | ||||||||
ACCUMULATED DEFICIT: | ||||||||||||||||
Balance, beginning of period | $ | (1,692.1 | ) | $ | 16.3 | $ | (1,675.8 | ) | ||||||||
Net income (loss) | (33.3 | ) | 5.2 | (28.1 | ) | |||||||||||
Balance, end of period | $ | (1,725.4 | ) | $ | 21.5 | $ | (1,703.9 | ) | ||||||||
TREASURY STOCK, AT COST: | ||||||||||||||||
Balance, beginning of period | $ | (182.9 | ) | $ | — | $ | (182.9 | ) | ||||||||
Balance, end of period | $ | (182.9 | ) | $ | — | $ | (182.9 | ) | ||||||||
TOTAL STOCKHOLDERS’ EQUITY ATTRIBUTABLE TO | ||||||||||||||||
THE PHOENIX COMPANIES, INC.: | ||||||||||||||||
Balance, beginning of period | $ | 573 | $ | 16.5 | $ | 589.5 | ||||||||||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | (43.5 | ) | 8.1 | (35.4 | ) | |||||||||||
Balance, end of period | $ | 529.5 | $ | 24.6 | $ | 554.1 | ||||||||||
NONCONTROLLING INTERESTS: | ||||||||||||||||
Balance, beginning of period | $ | 10.7 | $ | 1.1 | $ | 11.8 | ||||||||||
Net income (loss) attributable to noncontrolling interests [1] | 1 | (1.1 | ) | (0.1 | ) | |||||||||||
Change in equity of noncontrolling interests [1] | 0.1 | — | 0.1 | |||||||||||||
Balance, end of period | $ | 11.8 | $ | — | $ | 11.8 | ||||||||||
TOTAL STOCKHOLDERS’ EQUITY: | ||||||||||||||||
Balance, beginning of period | $ | 583.7 | $ | 17.6 | $ | 601.3 | ||||||||||
Change in stockholders’ equity | (42.4 | ) | 7 | (35.4 | ) | |||||||||||
Balance, end of period | $ | 541.3 | $ | 24.6 | $ | 565.9 | ||||||||||
——————— | ||||||||||||||||
[1] | Reported net as change in noncontrolling interests in Note 26 to our consolidated financial statements in the 2014 Form 10-K. |
Basis_of_Presentation_and_Sign
Basis of Presentation and Significant Accounting Policies | 3 Months Ended | |
Mar. 31, 2015 | ||
Accounting Policies [Abstract] | ||
Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Significant Accounting Policies | |
We have prepared these consolidated interim unaudited financial statements in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”), which differs materially from the accounting practices prescribed by various insurance regulatory authorities. Our consolidated interim unaudited financial statements include the accounts of the Company and its subsidiaries. Intercompany balances and transactions have been eliminated in consolidating these consolidated interim unaudited financial statements. | ||
Certain prior year amounts have been reclassified to conform to the current year presentation. These consolidated interim unaudited financial statements include all adjustments (consisting primarily of accruals) considered necessary for the fair statement of the consolidated balance sheets, consolidated statements of income and comprehensive income, consolidated statements of cash flows and consolidated statements of changes in stockholders’ equity for the interim periods. Certain financial information that is not required for interim reporting has been omitted. Financial results for the three months ended March 31, 2015 are not necessarily indicative of full year results. For the three months ended March 31, 2015, there were no out-of-period adjustments. These consolidated interim unaudited financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2014 contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 (the “2014 Form 10-K”). | ||
Use of estimates | ||
In preparing these consolidated interim unaudited financial statements in conformity with U.S. GAAP, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated interim unaudited financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions are made in the determination of estimated gross profits (“EGPs”) and estimated gross margins (“EGMs”) used in the valuation and amortization of assets and liabilities associated with universal life and annuity contracts; policyholder liabilities and accruals; valuation of investments in debt and equity securities; limited partnerships and other investments; valuation of deferred tax assets; pension and other post-employment benefits liabilities; and accruals for contingent liabilities. Certain of these estimates are particularly sensitive to market conditions and/or volatility in the debt or equity markets could have a material impact on the consolidated interim unaudited financial statements. Actual results could differ from these estimates. | ||
Holding company liquidity | ||
The Phoenix Companies, Inc. serves as the holding company for our insurance subsidiaries and does not have any significant operations of its own. As of March 31, 2015 and December 31, 2014, liquidity (cash, short-term investments, available-for-sale debt securities and other near-cash assets) totaled $83.1 million and $78.3 million, respectively. Of these amounts, $10.8 million is included in the escrow described below. | ||
In addition to existing cash and securities, the holding company’s primary source of liquidity consists of dividends from Phoenix Life. Under New York Insurance Law, Phoenix Life is permitted to pay stockholder dividends to the holding company in any calendar year without prior approval from the New York Department of Financial Services (the “NYDFS”) in the amount of the lesser of 10% of Phoenix Life’s surplus to policyholders as of the immediately preceding calendar year or Phoenix Life’s statutory net gain from operations for the immediately preceding calendar year, not including realized capital gains. Based on this calculation, Phoenix Life would be able to pay a dividend of $59.9 million in 2015. During the three months ended March 31, 2015, Phoenix Life declared $15.0 million in dividends. | ||
Our principal needs at the holding company level are debt service, income taxes and certain operating expenses. | ||
• | We pay interest on senior unsecured bonds. Interest paid on senior unsecured bonds for the three months ended March 31, 2015 and 2014 was $5.0 million and $5.0 million, respectively. As of March 31, 2015, future minimum annual principal payments on senior unsecured bonds are $252.7 million in 2032. See Note 9 to these consolidated interim unaudited financial statements for additional information. | |
• | The holding company and its subsidiaries have a tax sharing agreement. The subsidiaries compute their provision for federal income taxes as if they were each filing a separate federal income tax return. There are quarterly settlements among the companies representing each of the subsidiaries’ estimated separate company tax liability for the current tax year and any amount that such subsidiary overpaid to the holding company for a taxable year. As part of the intercompany tax sharing agreement, the holding company is required to hold funds in escrow for the benefit of Phoenix Life in the event Phoenix Life incurs future taxable losses. In accordance with its regulatory obligation, in October 2014 the Company funded the escrow with $78.9 million of assets including treasury stock, a surplus note issued by PHL Variable and $10.8 million of cash from the holding company. | |
• | The holding company pays operating expenses associated with its operation. It has also paid the majority of the expenses associated with the restatements of our prior period financial statements. Holding company operating expenses for the three months ended March 31, 2015 and 2014 were $10.1 million and $40.3 million, respectively. There are expense sharing arrangements in place among the holding company and its operating subsidiaries. However, given unique circumstances regarding the restatement, management determined it was in the best interest of the Company that the majority of these costs be borne by the holding company. | |
The holding company also provides capital support to its operating subsidiaries. Management targets a minimum risk based capital of 225% at PHL Variable. As of March 31, 2015, PHL Variable had an estimated risk-based capital ratio of 122%, compared with 218% at December 31, 2014, reflecting its portion of litigation accruals recorded in the first quarter, unfavorable mortality and a lower admitted deferred tax asset resulting from the surplus decline. The Company is pursuing a number of capital management actions, including a reinsurance treaty between its operating subsidiaries to optimize its statutory capital deployment. The Company is working to close the transaction in the second quarter. There can be no assurance that the regulators who must approve this transaction will either approve or approve with conditions acceptable to the Company. If the reinsurance treaty is not effected, which management does not anticipate, the Company may consider other options which could include capital contributions from Phoenix Life, the holding company, or third parties, or other actions. | ||
The Phoenix Companies, Inc. made $15.0 million and $45.0 million of capital contributions for the benefit of PHL Variable in 2014 and 2013, respectively, and may need to again in the future. The need for additional capital contributions to operating subsidiaries or an inability to reduce expenses at the holding company could constrain the ability of the holding company to meet its debt obligations. Based on management’s review of the holding company’s liquidity position, we believe it can continue to meet its liquidity obligations in the holding company through 2015 and beyond. | ||
Adoption of new accounting standards | ||
Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity | ||
In April 2014, the Financial Accounting Standards Board (the “FASB”) issued updated guidance that changes the criteria for reporting discontinued operations and introduces new financial statement disclosures. The new guidance is effective prospectively to new disposals and new classifications of disposal groups as held for sale that occur within annual periods beginning on or after December 15, 2014 and interim periods within those annual periods. This new guidance did not have any impact on the Company’s consolidated financial position, results of operations and financial statement disclosures. | ||
Accounting for Troubled Debt Restructurings by Creditors | ||
In January 2014, the FASB issued updated guidance for troubled debt restructurings clarifying when an in substance repossession or foreclosure occurs, and when a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan. The new guidance is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2014.This new guidance did not have a material impact on the Company’s consolidated financial position, results of operations and financial statement disclosures. | ||
Accounting for Investments in Qualified Affordable Housing Projects | ||
In January 2014, the FASB issued updated guidance regarding investments in flow-through limited liability entities that manage or invest in affordable housing projects that qualify for the low-income housing tax credit. Under the guidance, an entity is permitted to make an accounting policy election to amortize the initial cost of its investment in proportion to the tax credits and other tax benefits received and recognize the net investment performance in the statement of operations as a component of income tax expense (benefit) if certain conditions are met. The new guidance is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. This new guidance did not have a material impact on the Company’s consolidated financial position, results of operations and financial statement disclosures. | ||
Accounting standards not yet adopted | ||
For information regarding additional accounting standards that the Company has not yet adopted, see the “Accounting Standards Not Yet Adopted” section of Note 3 of Notes to the Consolidated Financial Statements in the Company’s 2014 Form 10-K. There have been no changes other than as noted below. | ||
Interest - Imputation of Interest (Simplifying the Presentation of Debt Issuance Costs) | ||
In April 2015, the FASB issued guidance that changes the presentation of debt issuance costs in financial statements. Under the new guidance, a company would present debt issuance costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. The recognition and measurement of debt issuance costs is not affected by the new guidance. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015, and should be applied retrospectively to all periods presented. Early adoption is allowed for all entities for financial statements that have not been previously issued. This guidance will not have any effect on the Company’s consolidated financial position or results of operations. | ||
Significant accounting policies | ||
Our significant accounting policies are presented in the notes to our consolidated financial statements for the year ended December 31, 2014 contained in the 2014 Form 10-K except for the following update to our expected future interest rate assumption as noted more fully below. |
Reinsurance
Reinsurance | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Insurance [Abstract] | ||||||||
Reinsurance | Reinsurance | |||||||
Reinsurance recoverable includes balances due from reinsurers for paid and unpaid losses and is presented net of an allowance for uncollectable reinsurance. The reinsurance recoverable balance is $600.3 million and $559.1 million as of March 31, 2015 and December 31, 2014, respectively. Other reinsurance activity is shown below. | ||||||||
Direct Business and Reinsurance in Continuing Operations: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Direct premiums | $ | 111 | $ | 115.8 | ||||
Premiums assumed | 1.8 | 1.8 | ||||||
Premiums ceded [1] | (34.4 | ) | (38.0 | ) | ||||
Premiums | $ | 78.4 | $ | 79.6 | ||||
Percentage of amount assumed to net premiums | 2.30% | 2.30% | ||||||
Direct policy benefits incurred | $ | 327.3 | $ | 178.5 | ||||
Policy benefits assumed | 1.6 | 12.6 | ||||||
Policy benefits ceded | (88.5 | ) | (68.7 | ) | ||||
Premiums paid [2] | 22.6 | 22.3 | ||||||
Policy benefits [3] | $ | 263 | $ | 144.7 | ||||
——————— | ||||||||
[1] | Primarily represents premiums ceded to reinsurers related to traditional whole life and term insurance policies. | |||||||
[2] | For universal life and variable universal life contracts, premiums paid to reinsurers are reflected within policy benefits. See Note 3 to these consolidated interim unaudited financial statements for additional information regarding significant accounting policies. | |||||||
[3] | Policy benefit amounts above exclude changes in reserves, interest credited to policyholders and other items, which total $29.0 million and $85.6 million, net of reinsurance, for the three months ended March 31, 2015 and 2014, respectively. | |||||||
We remain liable to the extent that reinsuring companies may not be able to meet their obligations under reinsurance agreements in effect. Failure of the reinsurers to honor their obligations could result in losses to the Company. Since we bear the risk of nonpayment, on a quarterly basis we evaluate the financial condition of our reinsurers and monitor concentrations of credit risk. Based on our review of their financial statements, reputation in the reinsurance marketplace and other relevant information, we believe that we have no material exposure to uncollectible life reinsurance. At March 31, 2015, five major reinsurance companies account for approximately 65% of the reinsurance recoverable. |
Demutualization_and_Closed_Blo
Demutualization and Closed Block | 3 Months Ended | |||||||||||
Mar. 31, 2015 | ||||||||||||
Insurance [Abstract] | ||||||||||||
Demutualization and Closed Block | Demutualization and Closed Block | |||||||||||
In 1999, we began the process of reorganizing and demutualizing our then principal operating company, Phoenix Home Life. We completed the process in June 2001, when all policyholder membership interests in this mutual company were extinguished and eligible policyholders of the mutual company received shares of PNX common stock, together with cash and policy credits, as compensation. To protect the future dividends of these policyholders, we also established a closed block for their existing policies. | ||||||||||||
Because closed block liabilities exceed closed block assets, we have a net closed block liability at March 31, 2015 and December 31, 2014, respectively. This net liability represents the maximum future earnings contribution to be recognized from the closed block and the change in this net liability each period is in the earnings contribution recognized from the closed block for the period. To the extent that actual cash flows differ from amounts anticipated, we may adjust policyholder dividends. If the closed block has excess funds, those funds will be available only to the closed block policyholders. However, if the closed block has insufficient funds to make policy benefit payments that are guaranteed, the payments will be made from assets outside of the closed block. | ||||||||||||
Closed Block Assets and Liabilities as of: | March 31, | 31-Dec-14 | Inception | |||||||||
($ in millions) | 2015 | |||||||||||
Available-for-sale debt securities | $ | 5,886.10 | $ | 5,877.00 | $ | 4,773.10 | ||||||
Available-for-sale equity securities | 89 | 91.7 | — | |||||||||
Short-term investments | 9.9 | — | — | |||||||||
Limited partnerships and other investments | 347.1 | 343.4 | 399 | |||||||||
Policy loans | 1,149.70 | 1,159.10 | 1,380.00 | |||||||||
Fair value investments | 65.3 | 59.8 | — | |||||||||
Total closed block investments | 7,547.10 | 7,531.00 | 6,552.10 | |||||||||
Cash and cash equivalents | 99 | 89.6 | — | |||||||||
Accrued investment income | 80.7 | 80.7 | 106.8 | |||||||||
Reinsurance recoverable | 36.6 | 19.1 | — | |||||||||
Deferred income taxes, net | 289 | 290.3 | 389.4 | |||||||||
Other closed block assets | 65.4 | 67.4 | 41.4 | |||||||||
Total closed block assets | 8,117.80 | 8,078.10 | 7,089.70 | |||||||||
Policy liabilities and accruals | 8,018.00 | 8,058.20 | 8,301.70 | |||||||||
Policyholder dividends payable | 201 | 201.9 | 325.1 | |||||||||
Policy dividend obligation | 776 | 714.8 | — | |||||||||
Other closed block liabilities | 60.6 | 48 | 12.3 | |||||||||
Total closed block liabilities | 9,055.60 | 9,022.90 | 8,639.10 | |||||||||
Excess of closed block liabilities over closed block assets [1] | 937.8 | 944.8 | $ | 1,549.40 | ||||||||
Less: Excess of closed block assets over closed block liabilities | (12.8 | ) | (11.8 | ) | ||||||||
attributable to noncontrolling interests | ||||||||||||
Excess of closed block liabilities over closed block assets attributable to | $ | 950.6 | $ | 956.6 | ||||||||
The Phoenix Companies, Inc. | ||||||||||||
——————— | ||||||||||||
[1] | The maximum future earnings summary to inure to the benefit of the stockholders is represented by the excess of closed block liabilities over closed block assets. All unrealized investment gains (losses), net of income tax, have been allocated to the policyholder dividend obligation. | |||||||||||
Closed Block Revenues and Expenses and Changes in | Three Months Ended | |||||||||||
Policyholder Dividend Obligations: | March 31, | |||||||||||
($ in millions) | 2015 | 2014 | ||||||||||
Closed block revenues | ||||||||||||
Premiums | $ | 70.2 | $ | 72.8 | ||||||||
Net investment income | 100.2 | 107.3 | ||||||||||
Net realized gains (losses) | (4.6 | ) | 5.3 | |||||||||
Total revenues | 165.8 | 185.4 | ||||||||||
Policy benefits | 115.5 | 103.8 | ||||||||||
Other operating expenses | 0.1 | 0.2 | ||||||||||
Total benefits and expenses | 115.6 | 104 | ||||||||||
Closed block contribution to income before dividends | 50.2 | 81.4 | ||||||||||
and income taxes | ||||||||||||
Policyholder dividends | (40.1 | ) | (72.2 | ) | ||||||||
Closed block contribution to income before income taxes | 10.1 | 9.2 | ||||||||||
Applicable income tax expense | 3.5 | 3.2 | ||||||||||
Closed block contribution to income | 6.6 | 6 | ||||||||||
Less: Closed block contribution to income attributable to | 0.5 | (0.1 | ) | |||||||||
noncontrolling interests | ||||||||||||
Closed block contribution to income attributable to | $ | 6.1 | $ | 6.1 | ||||||||
The Phoenix Companies, Inc. | ||||||||||||
Closed Block Policyholder Dividend Obligation as of: | March 31, | 31-Dec-14 | ||||||||||
($ in millions) | 2015 | |||||||||||
Policyholder dividend obligation | ||||||||||||
Policyholder dividends provided through earnings | $ | 40.1 | $ | 244.6 | ||||||||
Policyholder dividends provided through OCI | 62.7 | 138.8 | ||||||||||
Additions to (reductions of) policyholder dividend liabilities | 102.8 | 383.4 | ||||||||||
Policyholder dividends paid | (42.5 | ) | (172.2 | ) | ||||||||
Increase (decrease) in policyholder dividend liabilities | 60.3 | 211.2 | ||||||||||
Policyholder dividend liabilities, beginning of period | 916.7 | 705.5 | ||||||||||
Policyholder dividend liabilities, end of period | 977 | 916.7 | ||||||||||
Policyholder dividends payable, end of period | (201.0 | ) | (201.9 | ) | ||||||||
Policyholder dividend obligation, end of period | $ | 776 | $ | 714.8 | ||||||||
The policyholder dividend obligation includes approximately $276.7 million and $277.9 million, respectively, for cumulative closed block earnings in excess of expected amounts calculated at the date of demutualization as of March 31, 2015 and December 31, 2014, respectively. These closed block earnings will not inure to stockholders, but will result in additional future dividends to closed block policyholders unless otherwise offset by future performance of the closed block that is less favorable than expected. If actual cumulative performance is less favorable than expected, only actual earnings will be recognized in net income. As of March 31, 2015 and December 31, 2014, the policyholder dividend obligation also includes $499.3 million and $436.9 million, respectively, of net unrealized gains on investments supporting the closed block liabilities. |
Deferred_Policy_Acquisition_Co
Deferred Policy Acquisition Costs | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Deferred Policy Acquisition Costs Disclosures [Abstract] | ||||||||
Deferred Policy Acquisition Costs | Deferred Policy Acquisition Costs | |||||||
The balances of and changes in deferred policy acquisition costs (“DAC”) as of and for the periods ended March 31, 2015 and 2014 are as follows: | ||||||||
Changes in Deferred Policy Acquisition Costs: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Balance, beginning of period | $ | 848.6 | $ | 947.8 | ||||
Policy acquisition costs deferred | 21.8 | 14.6 | ||||||
Costs amortized to expenses: | ||||||||
Recurring costs | (15.1 | ) | (35.7 | ) | ||||
Assumption unlocking | (6.6 | ) | — | |||||
Realized investment gains (losses) | 4.6 | 11.1 | ||||||
Offsets to net unrealized investment gains or losses | (16.8 | ) | (30.9 | ) | ||||
included in AOCI | ||||||||
Balance, end of period | $ | 836.5 | $ | 906.9 | ||||
Sales_Inducements
Sales Inducements | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Deferred Sales Inducements [Abstract] | ||||||||
Sales Inducements | Sales Inducements | |||||||
The balances of and changes in sales inducements as of and for the periods ended March 31, 2015 and 2014 are as follows: | ||||||||
Changes in Deferred Sales Inducement Activity: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Balance, beginning of period | $ | 79.4 | $ | 77.4 | ||||
Sales inducements deferred | 5.3 | 2.1 | ||||||
Amortization charged to income | (1.9 | ) | (0.2 | ) | ||||
Offsets to net unrealized investment gains or losses | (3.6 | ) | (3.2 | ) | ||||
included in AOCI | ||||||||
Balance, end of period | $ | 79.2 | $ | 76.1 | ||||
Investing_Activities
Investing Activities | 3 Months Ended | |||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ||||||||||||||||||||||||
Investing Activities | Investing Activities | |||||||||||||||||||||||
Debt and equity securities | ||||||||||||||||||||||||
The following tables present the debt and equity securities available-for-sale by sector held at March 31, 2015 and December 31, 2014, respectively. The unrealized loss amounts presented below include the non-credit loss component of OTTI losses. We classify these investments into various sectors in line with industry conventions. | ||||||||||||||||||||||||
Fair Value and Cost of Securities: | 31-Mar-15 | |||||||||||||||||||||||
($ in millions) | Amortized | Gross | Gross | Fair | OTTI | |||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Recognized | ||||||||||||||||||||
Gains [1] | Losses [1] | in AOCI [2] | ||||||||||||||||||||||
U.S. government and agency | $ | 384.8 | $ | 61.9 | $ | — | $ | 446.7 | $ | — | ||||||||||||||
State and political subdivision | 531.5 | 51.5 | (2.5 | ) | 580.5 | (1.1 | ) | |||||||||||||||||
Foreign government | 218.6 | 29.9 | (0.5 | ) | 248 | — | ||||||||||||||||||
Corporate | 8,148.70 | 626.1 | (62.7 | ) | 8,712.10 | (7.0 | ) | |||||||||||||||||
Commercial mortgage-backed (“CMBS”) | 597.1 | 53.8 | — | 650.9 | (1.2 | ) | ||||||||||||||||||
Residential mortgage-backed (“RMBS”) | 1,794.00 | 86.6 | (9.7 | ) | 1,870.90 | (25.4 | ) | |||||||||||||||||
Collateralized debt obligations (“CDO”) / | 204.1 | 3.6 | (2.2 | ) | 205.5 | (13.1 | ) | |||||||||||||||||
collateralized loan obligations (“CLO”) | ||||||||||||||||||||||||
Other asset-backed (“ABS”) | 261.3 | 13.9 | (4.5 | ) | 270.7 | (1.8 | ) | |||||||||||||||||
Available-for-sale debt securities | $ | 12,140.10 | $ | 927.3 | $ | (82.1 | ) | $ | 12,985.30 | $ | (49.6 | ) | ||||||||||||
Amounts applicable to the closed block | $ | 5,396.70 | $ | 515.1 | $ | (25.7 | ) | $ | 5,886.10 | $ | (14.2 | ) | ||||||||||||
Available-for-sale equity securities | $ | 154.5 | $ | 22.1 | $ | (1.1 | ) | $ | 175.5 | $ | — | |||||||||||||
Amounts applicable to the closed block | $ | 79.1 | $ | 10.7 | $ | (0.8 | ) | $ | 89 | $ | — | |||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Net unrealized investment gains and losses on securities classified as available-for-sale and certain other assets are included in our consolidated balance sheets as a component of AOCI. | |||||||||||||||||||||||
[2] | Represents the amount of non-credit OTTI losses recognized in AOCI excluding net unrealized gains or losses subsequent to the date of impairment. The table above presents the special category of AOCI for debt securities that are other-than-temporarily impaired when the impairment loss has been split between the credit loss component (in earnings) and the non-credit component (separate category of AOCI). | |||||||||||||||||||||||
Fair Value and Cost of Securities: | 31-Dec-14 | |||||||||||||||||||||||
($ in millions) | Amortized | Gross | Gross | Fair | OTTI | |||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Recognized | ||||||||||||||||||||
Gains [1] | Losses [1] | in AOCI [2] | ||||||||||||||||||||||
U.S. government and agency | $ | 388.3 | $ | 55.2 | $ | (0.1 | ) | $ | 443.4 | $ | — | |||||||||||||
State and political subdivision | 518.3 | 42.1 | (2.5 | ) | 557.9 | (1.1 | ) | |||||||||||||||||
Foreign government | 205.8 | 26.5 | (1.4 | ) | 230.9 | — | ||||||||||||||||||
Corporate | 7,942.70 | 530 | (74.6 | ) | 8,398.10 | (8.3 | ) | |||||||||||||||||
CMBS | 602.9 | 48.4 | (0.1 | ) | 651.2 | (1.2 | ) | |||||||||||||||||
RMBS | 1,862.50 | 81.6 | (11.9 | ) | 1,932.20 | (25.5 | ) | |||||||||||||||||
CDO/CLO | 197.5 | 2.7 | (3.3 | ) | 196.9 | (13.9 | ) | |||||||||||||||||
Other ABS | 260 | 13.4 | (4.7 | ) | 268.7 | (1.8 | ) | |||||||||||||||||
Available-for-sale debt securities | $ | 11,978.00 | $ | 799.9 | $ | (98.6 | ) | $ | 12,679.30 | $ | (51.8 | ) | ||||||||||||
Amounts applicable to the closed block | $ | 5,451.30 | $ | 458.1 | $ | (32.4 | ) | $ | 5,877.00 | $ | (14.7 | ) | ||||||||||||
Available-for-sale equity securities | $ | 156 | $ | 25.1 | $ | (1.6 | ) | $ | 179.5 | $ | — | |||||||||||||
Amounts applicable to the closed block | $ | 80.5 | $ | 12.3 | $ | (1.1 | ) | $ | 91.7 | $ | — | |||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Net unrealized investment gains and losses on securities classified as available-for-sale and certain other assets are included in our consolidated balance sheets as a component of AOCI. | |||||||||||||||||||||||
[2] | Represents the amount of non-credit OTTI losses recognized in AOCI excluding net unrealized gains or losses subsequent to the date of impairment. The table above presents the special category of AOCI for debt securities that are other-than-temporarily impaired when the impairment loss has been split between the credit loss component (in earnings) and the non-credit component (separate category of AOCI). | |||||||||||||||||||||||
Maturities of Debt Securities: | 31-Mar-15 | |||||||||||||||||||||||
($ in millions) | Amortized | Fair | ||||||||||||||||||||||
Cost | Value | |||||||||||||||||||||||
Due in one year or less | $ | 310.2 | $ | 313.8 | ||||||||||||||||||||
Due after one year through five years | 2,007.00 | 2,139.80 | ||||||||||||||||||||||
Due after five years through ten years | 3,513.30 | 3,711.80 | ||||||||||||||||||||||
Due after ten years | 3,453.10 | 3,821.90 | ||||||||||||||||||||||
CMBS/RMBS/ABS/CDO/CLO [1] | 2,856.50 | 2,998.00 | ||||||||||||||||||||||
Total | $ | 12,140.10 | $ | 12,985.30 | ||||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | CMBS, RMBS, ABS, CDO and CLO are not listed separately in the table as each security does not have a single fixed maturity. | |||||||||||||||||||||||
The maturities of debt securities, as of March 31, 2015, are summarized in the table above by contractual maturity. Actual maturities may differ from contractual maturities as certain borrowers have the right to call or prepay obligations with or without call or prepayment penalties, and we have the right to put or sell certain obligations back to the issuers. | ||||||||||||||||||||||||
The following table depicts the sources of available-for-sale investment proceeds and related investment gains (losses). | ||||||||||||||||||||||||
Sales of Available-for-Sale Securities: | Three Months Ended | |||||||||||||||||||||||
($ in millions) | March 31, | |||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||
Debt securities, available-for-sale | ||||||||||||||||||||||||
Proceeds from sales | $ | 155.6 | $ | 48.4 | ||||||||||||||||||||
Proceeds from maturities/repayments | 243.9 | 289.3 | ||||||||||||||||||||||
Gross investment gains from sales, prepayments and maturities | 8.5 | 11.5 | ||||||||||||||||||||||
Gross investment losses from sales and maturities | (0.9 | ) | (3.8 | ) | ||||||||||||||||||||
Equity securities, available-for-sale | ||||||||||||||||||||||||
Proceeds from sales | $ | 1.7 | $ | 4.2 | ||||||||||||||||||||
Gross investment gains from sales | — | 1.9 | ||||||||||||||||||||||
Gross investment losses from sales | — | — | ||||||||||||||||||||||
Aging of Temporarily Impaired Securities: | 31-Mar-15 | |||||||||||||||||||||||
($ in millions) | Less than 12 months | Greater than 12 months | Total | |||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
Debt Securities | ||||||||||||||||||||||||
U.S. government and agency | $ | — | $ | — | $ | 1.7 | $ | — | $ | 1.7 | $ | — | ||||||||||||
State and political subdivision | 11.3 | (0.6 | ) | 28 | (1.9 | ) | 39.3 | (2.5 | ) | |||||||||||||||
Foreign government | 11.5 | (0.5 | ) | — | — | 11.5 | (0.5 | ) | ||||||||||||||||
Corporate | 443.3 | (21.0 | ) | 439.4 | (41.7 | ) | 882.7 | (62.7 | ) | |||||||||||||||
CMBS | 3.5 | — | — | — | 3.5 | — | ||||||||||||||||||
RMBS | 28.5 | (0.1 | ) | 205.6 | (9.6 | ) | 234.1 | (9.7 | ) | |||||||||||||||
CDO/CLO | 27.2 | (0.2 | ) | 86.7 | (2.0 | ) | 113.9 | (2.2 | ) | |||||||||||||||
Other ABS | 3.2 | — | 15.3 | (4.5 | ) | 18.5 | (4.5 | ) | ||||||||||||||||
Debt securities | 528.5 | (22.4 | ) | 776.7 | (59.7 | ) | 1,305.20 | (82.1 | ) | |||||||||||||||
Equity securities | 7.7 | (0.9 | ) | 15.9 | (0.2 | ) | 23.6 | (1.1 | ) | |||||||||||||||
Total temporarily impaired securities | $ | 536.2 | $ | (23.3 | ) | $ | 792.6 | $ | (59.9 | ) | $ | 1,328.80 | $ | (83.2 | ) | |||||||||
Amounts inside the closed block | $ | 182.2 | $ | (11.0 | ) | $ | 298.2 | $ | (15.5 | ) | $ | 480.4 | $ | (26.5 | ) | |||||||||
Amounts outside the closed block | $ | 354 | $ | (12.3 | ) | $ | 494.4 | $ | (44.4 | ) | $ | 848.4 | $ | (56.7 | ) | |||||||||
Amounts outside the closed block | $ | 84.2 | $ | (5.0 | ) | $ | 60.7 | $ | (7.7 | ) | $ | 144.9 | $ | (12.7 | ) | |||||||||
that are below investment grade | ||||||||||||||||||||||||
Number of securities | 118 | 156 | 274 | |||||||||||||||||||||
Aging of Temporarily Impaired Securities: | 31-Dec-14 | |||||||||||||||||||||||
($ in millions) | Less than 12 months | Greater than 12 months | Total | |||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
Debt Securities | ||||||||||||||||||||||||
U.S. government and agency | $ | — | $ | — | $ | 2.7 | $ | (0.1 | ) | $ | 2.7 | $ | (0.1 | ) | ||||||||||
State and political subdivision | 11.6 | (0.6 | ) | 31.1 | (1.9 | ) | 42.7 | (2.5 | ) | |||||||||||||||
Foreign government | 15.7 | (1.4 | ) | — | — | 15.7 | (1.4 | ) | ||||||||||||||||
Corporate | 643 | (23.5 | ) | 654.3 | (51.1 | ) | 1,297.30 | (74.6 | ) | |||||||||||||||
CMBS | 12.6 | — | 10.9 | (0.1 | ) | 23.5 | (0.1 | ) | ||||||||||||||||
RMBS | 8.4 | (0.2 | ) | 226.7 | (11.7 | ) | 235.1 | (11.9 | ) | |||||||||||||||
CDO/CLO | 57.9 | (0.5 | ) | 96.3 | (2.8 | ) | 154.2 | (3.3 | ) | |||||||||||||||
Other ABS | 13.8 | (0.1 | ) | 16 | (4.6 | ) | 29.8 | (4.7 | ) | |||||||||||||||
Debt securities | 763 | (26.3 | ) | 1,038.00 | (72.3 | ) | 1,801.00 | (98.6 | ) | |||||||||||||||
Equity securities | 5.6 | (0.7 | ) | 15.2 | (0.9 | ) | 20.8 | (1.6 | ) | |||||||||||||||
Total temporarily impaired securities | $ | 768.6 | $ | (27.0 | ) | $ | 1,053.20 | $ | (73.2 | ) | $ | 1,821.80 | $ | (100.2 | ) | |||||||||
Amounts inside the closed block | $ | 266.8 | $ | (11.7 | ) | $ | 387.8 | $ | (21.8 | ) | $ | 654.6 | $ | (33.5 | ) | |||||||||
Amounts outside the closed block | $ | 501.8 | $ | (15.3 | ) | $ | 665.4 | $ | (51.4 | ) | $ | 1,167.20 | $ | (66.7 | ) | |||||||||
Amounts outside the closed block | $ | 84.2 | $ | (4.1 | ) | $ | 50.4 | $ | (6.6 | ) | $ | 134.6 | $ | (10.7 | ) | |||||||||
that are below investment grade | ||||||||||||||||||||||||
Number of securities | 158 | 211 | 369 | |||||||||||||||||||||
Unrealized losses on below-investment-grade debt securities outside the closed block and inside the closed block with a fair value depressed by more than 20% of amortized cost totaled $3.4 million and $0.3 million, respectively, at March 31, 2015, of which $2.1 million and $0, respectively, were depressed by more than 20% of amortized cost for more than 12 months. | ||||||||||||||||||||||||
As of March 31, 2015, available-for-sale securities in an unrealized loss position for over 12 months consisted of 147 debt securities and 9 equity securities. These debt securities primarily relate to corporate securities, RMBS and other ABS, which have depressed values due primarily to an increase in interest rates since the purchase of these securities. Unrealized losses were not recognized in earnings on these debt securities since the Company neither intends to sell the securities nor do we believe that it is more likely than not that it will be required to sell these securities before recovery of their amortized cost basis. Additionally, based on a security-by-security analysis, we expect to recover the entire amortized cost basis of these securities. In our evaluation of each security, management considers the actual recovery periods for these securities in previous periods of broad market declines. For securities with significant declines, individual security level analysis was performed, which considered any credit enhancements, expectations of defaults on underlying collateral and other available market data, including industry analyst reports and forecasts. Similarly, for equity securities in an unrealized loss position for greater than 12 months, management performed an analysis on a security-by-security basis. Although there may be sustained losses for greater than 12 months on these securities, additional information was obtained related to company performance which did not indicate that the additional losses were other-than-temporary. | ||||||||||||||||||||||||
Evaluating temporarily impaired available-for-sale securities | ||||||||||||||||||||||||
In management’s evaluation of temporarily impaired securities, many factors about individual issuers of securities as well as our best judgment in determining the cause of a decline in the estimated fair value are considered in the assessment of potential near-term recovery in the security’s value. Some of those considerations include, but are not limited to: (i) duration of time and extent to which the estimated fair value has been below cost or amortized cost; (ii) for debt securities, if the Company has the intent to sell or will more likely than not be required to sell a particular security before the decline in estimated fair value below amortized cost recovers; (iii) whether the issuer is experiencing significant financial difficulties and the potential for impairments of that issuer’s securities; (iv) pervasive issues across an entire industry sector/sub-sector; and (v) for structured securities, assessing any changes in the forecasted cash flows, the quality of underlying collateral, expectations of prepayment speeds, loss severity and payment priority of tranches held. | ||||||||||||||||||||||||
Other-than-temporary impairments | ||||||||||||||||||||||||
Management assessed all securities in an unrealized loss position in determining whether impairments were temporary or other-than-temporary. In reaching its conclusions, management exercised significant judgment and used a number of issuer-specific quantitative indicators and qualitative judgments to assess the probability of receiving a given security’s contractual cash flows. This included the issue’s implied yield to maturity, cumulative default rate based on rating, comparisons of issue-specific spreads to industry or sector spreads, specific trading activity in the issue and other market data such as recent debt tenders and upcoming refinancing requirements. Management also reviewed fundamentals such as issuer credit and liquidity metrics, business outlook and industry conditions. Management maintains a watch list of securities that is reviewed for impairments. Each security on the watch list was evaluated, analyzed and discussed, with the positive and negative factors weighed in the ultimate determination of whether or not the security was other-than-temporarily impaired. For securities for which no OTTI was ultimately indicated at March 31, 2015, management does not have the intention to sell, nor does it expect to be required to sell, these securities prior to their recovery. | ||||||||||||||||||||||||
OTTIs recorded on available-for-sale debt and equity securities for the three months ended March 31, 2015 and 2014 of $8.4 million and $0.2 million, respectively. The 2015 debt impairments of $1.5 million were driven primarily by deterioration in issuer credit and liquidity metrics and business outlook and the equity impairment of $6.9 million was driven by exposure to an equity investment with exposure to the oil and gas industry. | ||||||||||||||||||||||||
The following table presents a roll-forward of pre-tax credit losses recognized in earnings related to available-for-sale debt securities for which a portion of the OTTI was recognized in OCI. | ||||||||||||||||||||||||
Credit Losses Recognized in Earnings on Available-for-Sale Debt Securities | Three Months Ended | |||||||||||||||||||||||
for which a Portion of the OTTI Loss was Recognized in OCI: | March 31, | |||||||||||||||||||||||
($ in millions) | 2015 | 2014 | ||||||||||||||||||||||
Balance, beginning of period | $ | (52.4 | ) | $ | (71.4 | ) | ||||||||||||||||||
Add: Credit losses on securities not previously impaired [1] | — | — | ||||||||||||||||||||||
Add: Credit losses on securities previously impaired [1] | — | — | ||||||||||||||||||||||
Less: Credit losses on securities impaired due to intent to sell | — | — | ||||||||||||||||||||||
Less: Credit losses on securities sold | 3.2 | 8.3 | ||||||||||||||||||||||
Less: Increases in cash flows expected on | — | — | ||||||||||||||||||||||
previously impaired securities | ||||||||||||||||||||||||
Balance, end of period | $ | (49.2 | ) | $ | (63.1 | ) | ||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Additional credit losses on securities for which a portion of the OTTI loss was recognized in AOCI are included within net OTTI losses recognized in earnings on the consolidated statements of income and comprehensive income. | |||||||||||||||||||||||
Limited partnerships and other investments | ||||||||||||||||||||||||
Limited Partnerships and Other Investments: | March 31, | 31-Dec-14 | ||||||||||||||||||||||
($ in millions) | 2015 | |||||||||||||||||||||||
Limited partnerships | ||||||||||||||||||||||||
Private equity funds | $ | 249.7 | $ | 241.1 | ||||||||||||||||||||
Mezzanine funds | 165.1 | 162.4 | ||||||||||||||||||||||
Infrastructure funds | 38.4 | 38.9 | ||||||||||||||||||||||
Hedge funds | 11 | 10.7 | ||||||||||||||||||||||
Mortgage and real estate funds | 4.2 | 3.7 | ||||||||||||||||||||||
Leveraged leases | 10.3 | 11.8 | ||||||||||||||||||||||
Direct equity investments | 38.2 | 49.6 | ||||||||||||||||||||||
Life settlements | 22.6 | 22.4 | ||||||||||||||||||||||
Other alternative assets | 2.2 | 2.2 | ||||||||||||||||||||||
Limited partnerships and other investments | $ | 541.7 | $ | 542.8 | ||||||||||||||||||||
Amounts applicable to the closed block | $ | 347.1 | $ | 343.4 | ||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||
Net investment income is comprised primarily of interest income, including amortization of premiums and accretion of discounts, based on yields which are changed due to expectations in projected cash flows, dividend income from common and preferred stock, gains and losses on securities measured at fair value and earnings from investments accounted for under equity method accounting. | ||||||||||||||||||||||||
Sources of Net Investment Income: | Three Months Ended | |||||||||||||||||||||||
March 31, | ||||||||||||||||||||||||
($ in millions) | 2015 | 2014 | ||||||||||||||||||||||
Debt securities [1] | $ | 148.8 | $ | 143.8 | ||||||||||||||||||||
Equity securities | 1.9 | 2.1 | ||||||||||||||||||||||
Limited partnerships and other investments | 13.2 | 26.5 | ||||||||||||||||||||||
Policy loans | 41.7 | 41.2 | ||||||||||||||||||||||
Fair value investments | 11.1 | 2.1 | ||||||||||||||||||||||
Total investment income | 216.7 | 215.7 | ||||||||||||||||||||||
Less: Discontinued operations | 0.3 | 0.3 | ||||||||||||||||||||||
Less: Investment expenses | 7.1 | 3.9 | ||||||||||||||||||||||
Net investment income | $ | 209.3 | $ | 211.5 | ||||||||||||||||||||
Amounts applicable to the closed block | $ | 100.2 | $ | 107.3 | ||||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Includes net investment income on short-term investments. | |||||||||||||||||||||||
Net realized gains (losses) | ||||||||||||||||||||||||
Sources and Types of | Three Months Ended | |||||||||||||||||||||||
Net Realized Gains (Losses): | March 31, | |||||||||||||||||||||||
($ in millions) | 2015 | 2014 | ||||||||||||||||||||||
Total other-than-temporary debt impairments | $ | (0.1 | ) | $ | 0.2 | |||||||||||||||||||
Portion of losses recognized in OCI | (1.4 | ) | (0.2 | ) | ||||||||||||||||||||
Net debt impairments recognized in earnings | $ | (1.5 | ) | $ | — | |||||||||||||||||||
Debt security impairments: | ||||||||||||||||||||||||
U.S. government and agency | $ | — | $ | — | ||||||||||||||||||||
State and political subdivision | — | — | ||||||||||||||||||||||
Foreign government | — | — | ||||||||||||||||||||||
Corporate | (1.3 | ) | ||||||||||||||||||||||
CMBS | — | — | ||||||||||||||||||||||
RMBS | (0.2 | ) | — | |||||||||||||||||||||
CDO/CLO | — | — | ||||||||||||||||||||||
Other ABS | — | — | ||||||||||||||||||||||
Net debt security impairments | (1.5 | ) | — | |||||||||||||||||||||
Equity security impairments | (6.9 | ) | (0.2 | ) | ||||||||||||||||||||
Limited partnerships and other investment impairments | — | — | ||||||||||||||||||||||
Impairment losses | (8.4 | ) | (0.2 | ) | ||||||||||||||||||||
Debt security transaction gains | 8.5 | 11.6 | ||||||||||||||||||||||
Debt security transaction losses | (0.9 | ) | (3.9 | ) | ||||||||||||||||||||
Equity security transaction gains | — | 1.9 | ||||||||||||||||||||||
Equity security transaction losses | — | — | ||||||||||||||||||||||
Limited partnerships and other investment transaction gains | — | — | ||||||||||||||||||||||
Limited partnerships and other investment transaction losses | — | — | ||||||||||||||||||||||
Net transaction gains (losses) | 7.6 | 9.6 | ||||||||||||||||||||||
Derivative instruments | (2.3 | ) | (23.8 | ) | ||||||||||||||||||||
Embedded derivatives [1] | (10.3 | ) | (12.9 | ) | ||||||||||||||||||||
Assets valued at fair value | (2.7 | ) | 0.4 | |||||||||||||||||||||
Net realized gains (losses), excluding impairment losses | (7.7 | ) | (26.7 | ) | ||||||||||||||||||||
Net realized gains (losses), including impairment losses | $ | (16.1 | ) | $ | (26.9 | ) | ||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Includes the change in fair value of embedded derivatives associated with fixed index annuity indexed crediting feature and variable annuity riders. See Note 11 to these consolidated interim unaudited financial statements for additional disclosures. | |||||||||||||||||||||||
Unrealized gains (losses) | ||||||||||||||||||||||||
Sources of Changes in | Three Months Ended | |||||||||||||||||||||||
Net Unrealized Gains (Losses): | March 31, | |||||||||||||||||||||||
($ in millions) | 2015 | 2014 | ||||||||||||||||||||||
Debt securities | $ | 143.9 | $ | 166 | ||||||||||||||||||||
Equity securities | (2.5 | ) | 2.1 | |||||||||||||||||||||
Other investments | (0.2 | ) | 0.4 | |||||||||||||||||||||
Net unrealized investment gains (losses) | $ | 141.2 | $ | 168.5 | ||||||||||||||||||||
Net unrealized investment gains (losses) | $ | 141.2 | $ | 168.5 | ||||||||||||||||||||
Applicable to closed block policyholder dividend obligation | 62.7 | 81.6 | ||||||||||||||||||||||
Applicable to DAC | 16.8 | 30.9 | ||||||||||||||||||||||
Applicable to other actuarial offsets | 58.3 | 32.3 | ||||||||||||||||||||||
Applicable to deferred income tax expense (benefit) | 7 | 32.7 | ||||||||||||||||||||||
Offsets to net unrealized investment gains (losses) | 144.8 | 177.5 | ||||||||||||||||||||||
Net unrealized gains (losses) included in OCI | $ | (3.6 | ) | $ | (9.0 | ) | ||||||||||||||||||
Consolidated variable interest entities | ||||||||||||||||||||||||
The Company regularly invests in private equity type fund structures which are variable interest entities (“VIEs”). Entities which do not have sufficient equity at risk to allow the entity to finance its activities without additional financial support or in which the equity investors, as a group, do not have the characteristic of a controlling financial interest are referred to as VIEs. We perform ongoing assessments of our investments in VIEs to determine if we are the primary beneficiary. When we are the primary beneficiary of the entity we consolidate the VIE. The consolidated entities are all investment company-like structures which follow specialized investment company accounting and record underlying investments at fair value. The nature of the consolidated VIEs’ operations and purpose are private equity limited partnerships, single asset limited liability companies (“LLCs”) and a fund of fund investment structure and have investments in homogeneous types of assets. We consolidate these VIEs using the most recent financial information received from the partnerships. Recognition of operating results is generally on a three-month delay due to the timing of the related financial statements. | ||||||||||||||||||||||||
The following table presents the total assets and total liabilities relating to consolidated VIEs at March 31, 2015 and December 31, 2014. | ||||||||||||||||||||||||
Carrying Value of Assets and Liabilities for | March 31, 2015 | 31-Dec-14 | ||||||||||||||||||||||
Consolidated Variable Interest Entities: | ||||||||||||||||||||||||
($ in millions) | Assets | Liabilities | Maximum | Assets | Liabilities | Maximum | ||||||||||||||||||
Exposure | Exposure | |||||||||||||||||||||||
to Loss [1] | to Loss [1] | |||||||||||||||||||||||
Debt securities, at fair value [2] | $ | 12.9 | $ | — | $ | 8.8 | $ | 5.5 | $ | — | $ | 5.1 | ||||||||||||
Equity securities, at fair value [2] | 37.5 | — | 32.6 | 35 | — | 30 | ||||||||||||||||||
Cash and cash equivalents | 10.1 | — | 9.8 | 9.4 | — | 9.3 | ||||||||||||||||||
Investment in partnership interests | 2.1 | — | 1.7 | — | — | — | ||||||||||||||||||
Investment in single asset LLCs | 50.6 | — | 38.8 | 50.6 | — | 36.6 | ||||||||||||||||||
Other assets | 0.7 | — | 0.6 | 0.6 | — | 0.5 | ||||||||||||||||||
Total assets of consolidated VIEs | $ | 113.9 | $ | — | $ | 92.3 | $ | 101.1 | $ | — | $ | 81.5 | ||||||||||||
Total liabilities of consolidated VIEs | $ | — | $ | 0.7 | $ | 0.5 | $ | — | $ | 0.6 | $ | 0.5 | ||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Creditors or beneficial interest holders of the consolidated VIEs have no recourse to our general credit. Our obligation to the VIEs is limited to the amount of our committed investment. We have not provided material financial or other support that was not contractually required to these VIEs. The maximum exposure to loss above at March 31, 2015 and December 31, 2014 excludes unfunded commitments of $9.9 million and $11.9 million, respectively. | |||||||||||||||||||||||
[2] | Included in available-for-sale debt and equity securities, at fair value on the consolidated balance sheets. | |||||||||||||||||||||||
Non-consolidated variable interest entities | ||||||||||||||||||||||||
The carrying value of our investments in non-consolidated VIEs (based upon sponsor values and financial statements of the individual entities) for which we are not the primary beneficiary was $152.3 million and $151.5 million as of March 31, 2015 and December 31, 2014, respectively. The maximum exposure to loss is equal to the carrying amounts plus any unfunded commitments of the Company. Such a maximum loss would be expected to occur only upon bankruptcy of the issuer or investee. The Company has not provided nor intends to provide material financial support to these entities unless contractually required. We do not have the contractual option to redeem these limited partnership interests but receive distributions based on the liquidation of the underlying assets. The Company must generally request general partner consent to transfer or sell its fund interests. The Company performs ongoing qualitative analysis of its involvement with VIEs to determine if consolidation is required. | ||||||||||||||||||||||||
Carrying Value of Assets and Liabilities | 31-Mar-15 | 31-Dec-14 | ||||||||||||||||||||||
and Maximum Exposure Loss Relating | ||||||||||||||||||||||||
to Variable Interest Entities: | ||||||||||||||||||||||||
($ in millions) | Assets | Liabilities | Maximum | Assets | Liabilities | Maximum | ||||||||||||||||||
Exposure | Exposure | |||||||||||||||||||||||
to Loss [1] | to Loss [1] | |||||||||||||||||||||||
Limited partnerships | $ | 116.9 | $ | — | $ | 190.5 | $ | 106 | $ | — | $ | 157.8 | ||||||||||||
LLCs | 35.4 | — | 35.4 | 45.5 | — | 45.5 | ||||||||||||||||||
Total | $ | 152.3 | $ | — | $ | 225.9 | $ | 151.5 | $ | — | $ | 203.3 | ||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Creditors or beneficial interest holders of the VIEs have no recourse to our general credit. Our obligation to the VIEs is limited to the amount of our committed investment. We have not provided material financial or other support that was not contractually required to these VIEs. | |||||||||||||||||||||||
In addition, the Company makes passive investments in structured securities issued by VIEs, for which the Company is not the manager, which are included in CMBS, RMBS, CDO/CLO and other ABS within available-for-sale debt securities, and in fair value investments, in the consolidated balance sheets. The Company has not provided financial or other support with respect to these investments other than its original investment. For these investments, the Company determined it is not the primary beneficiary due to the size of our investment relative to the structured securities issued by the VIE, the level of credit subordination which reduces the Company’s obligation to absorb losses or right to receive benefits, and the Company’s lack of power over the activities that most significantly impact the economic performance of the VIEs. The Company’s maximum exposure to loss on these investments is limited to the amount of our investment. | ||||||||||||||||||||||||
Issuer and counterparty credit exposure | ||||||||||||||||||||||||
Credit exposure related to issuers and derivatives counterparties is inherent in investments and derivative contracts with positive fair value or asset balances. We manage credit risk through the analysis of the underlying obligors, issuers and transaction structures. We review our debt security portfolio regularly to monitor the performance of obligors and assess the stability of their credit ratings. We also manage credit risk through industry and issuer diversification and asset allocation. Included in fixed maturities are below-investment-grade assets totaling $920.8 million and $848.8 million at March 31, 2015 and December 31, 2014, respectively. Maximum exposure to an issuer or derivative counterparty is defined by quality ratings, with higher quality issuers having larger exposure limits. As of March 31, 2015, we were exposed to the credit concentration risk of 36 issuers, Bank of America Corp, Berkshire Hathaway Inc., General Electric Company, Deutsche Bank AG, The Goldman Sachs Group, Inc., JPMorgan Chase & Co., BB&T Corporation, HSBC Holdings, Republic of Poland, Riverside Health System, MetLife Inc., The PNC Financial Services Group, Inc., Morgan Stanley, Barclay’s Bank, The Bank of New York Mellon Corporation, Irving Oil Ltd., HP Communications, Credit Suisse Group AG, Fifth Third Bancorp, Lowe’s Companies, United Mexican States, Compass Group plc, Pentair plc, Tri-State Generation and Transmission Association, LEG Inc., Sumitomo Mitsui Banking Corporation, National Football League, Triton Container International Ltd., Wells Fargo & Company, The Allstate Corportation, DTE Energy Company, CTL Consulting LLC, American Airlines Group Inc., University of Dayton, Enterprise Rent-A-Car, CenturyLink Inc., representing exposure greater than 10.0% of stockholders’ equity other than U.S. government and government agencies backed by the faith and credit of the U.S. government. We monitor credit exposures by actively monitoring dollar limits on transactions with specific counterparties. We have an overall limit on below-investment-grade rated issuer exposure. Additionally, the creditworthiness of counterparties is reviewed periodically. We generally use ISDA Master Agreements which include Credit Support Annexes which include collateral provisions to reduce counterparty credit exposures. To further mitigate the risk of loss on derivatives, we only enter into contracts in which the counterparty is a financial institution with a rating of A or higher from at least one Nationally Recognized Statistical Rating Organization. | ||||||||||||||||||||||||
As of March 31, 2015, we held derivative assets, net of liabilities, with a fair value of $63.1 million. Derivative credit exposure was diversified with 11 different counterparties. We also had investments of these issuers with a fair value of $295.7 million as of March 31, 2015. Our maximum amount of loss due to credit risk with these issuers was $358.8 million as of March 31, 2015. See Note 12 to these consolidated interim unaudited financial statements for additional information regarding derivatives. |
Financing_Activities
Financing Activities | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Financing Activities | Financing Activities | |||||||
Indebtedness | ||||||||
We have recorded indebtedness at unpaid principal balances of each instrument net of issue discount. The Company or its subsidiaries may, from time to time, purchase its debt securities in the open market subject to considerations including, but not limited to, market conditions, relative valuations, capital allocation and the determination that it is in the best interest of the Company and its stakeholders. | ||||||||
Debt is carried net of original issuer discount as follows: | ||||||||
Indebtedness at Carrying Value: | March 31, | 31-Dec-14 | ||||||
($ in millions) | 2015 | |||||||
7.15% surplus notes | $ | 126.2 | $ | 126.2 | ||||
7.45% senior unsecured bonds | 252.7 | 252.7 | ||||||
Total indebtedness | $ | 378.9 | $ | 378.9 | ||||
Future minimum annual principal payments on indebtedness as of March 31, 2015 are $252.7 million in 2032 and $126.7 million in 2034. | ||||||||
Interest Expense on Indebtedness, including | Three Months Ended | |||||||
Amortization of Debt Issuance Costs: | March 31, | |||||||
($ in millions) | 2015 | 2014 | ||||||
7.15% surplus notes | $ | 2.3 | $ | 2.3 | ||||
7.45% senior unsecured bonds | 4.8 | 4.8 | ||||||
Interest expense on indebtedness | $ | 7.1 | $ | 7.1 | ||||
7.15% surplus notes | ||||||||
Our 7.15% surplus notes are an obligation of Phoenix Life and are due December 15, 2034. The carrying value of the 2034 notes is net of $0.5 million of unamortized original issue discount. Interest payments are at an annual rate of 7.15%, require the prior approval of the NYDFS and may be made only out of surplus funds which the NYDFS determines to be available for such payments under New York Insurance Law. The notes may be redeemed at the option of Phoenix Life at any time at the “make-whole” redemption price set forth in the offering circular. New York Insurance Law provides that the notes are not part of the legal liabilities of Phoenix Life. On September 21, 2012, Phoenix Life repurchased $48.3 million par amount of its outstanding 7.15% surplus notes, including $0.2 million in original issue discount, for aggregate consideration of $36.2 million. | ||||||||
7.45% senior unsecured bonds | ||||||||
The Phoenix Companies, Inc. senior unsecured bonds were issued in December 2001 for gross proceeds of $300.0 million (net proceeds of $290.6 million) and mature in January 2032. We pay interest at an annual rate of 7.45%. We may redeem any or all of the bonds at a redemption price equal to 100% of principal plus accrued and unpaid interest to the redemption date. We have repurchased a cumulative amount of $47.3 million of par value of these bonds as of March 31, 2015. No repurchases were made during 2015 or 2014. | ||||||||
The indenture governing our senior unsecured bonds requires us to file with U.S. Bank, National Association, as trustee, within 15 days after we are required to file with the Securities and Exchange Commission (“SEC”), copies of the annual reports and of the information, documents and other reports that we are required to file with the SEC pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended (“Exchange Act”). In connection with a restatement of our prior period financial statements, we were unable to file with the SEC certain of our periodic SEC reports and meet the requirement to timely deliver a copy of such reports to the trustee. Prior to December 31, 2013, we successfully completed two consent solicitations of bondholders seeking consent to amend the indenture governing the bonds and provide a related waiver to extend the due dates for providing certain of our SEC reports to the trustee. | ||||||||
On January 23, 2014, we commenced a third consent solicitation of bondholders to further amend the indenture and provide a related waiver to extend the date for providing the trustee with the Company’s Quarterly Report on Form 10-Q for the third quarter of 2012 (the “Third Quarter 2012 Form 10-Q”), the 2012 Form 10-K, our Quarterly Reports on Form 10-Q for the first, second and third quarters of 2013 (the “2013 Forms 10-Q”), the 2013 Form 10-K and our Quarterly Reports on Form 10-Q for the first, second and third quarters of 2014 (the “2014 Forms 10-Q”) to March 16, 2015. On February 21, 2014, the Company and the trustee executed a third supplemental indenture providing that until 5:30 p.m., New York City time on March 16, 2015, any failure by us to comply with the sections of the Indenture relating to the filing of the Third Quarter 2012 Form 10-Q, the 2012 Form 10-K, the 2013 Forms 10-Q, the 2013 Form 10-K and the 2014 Forms 10-Q will not constitute defaults under the Indenture and that our filing of such reports on a delayed basis on or prior to such time and date will satisfy our obligations under the reporting covenant in the indenture. Pursuant to the waiver, any and all defaults and events of default occurring under the Indenture prior to the effectiveness of the third supplemental indenture are waived. | ||||||||
Common_Stock_and_Stock_Repurch
Common Stock and Stock Repurchase Program | 3 Months Ended |
Mar. 31, 2015 | |
Equity [Abstract] | |
Common Stock and Stock Repurchase Program | Common Stock and Stock Repurchase Program |
We have authorization for the issuance of 50 million shares of our common stock. | |
Through March 31, 2015, we have issued 6.4 million common shares (2.8 million shares to our policyholders in exchange for their interests in the mutual company and 3.6 million shares in sales to the public and to settle share-based compensation awards). As of March 31, 2015, shares issued and outstanding include 0.1 million shares held in a Rabbi Trust to fund equity awards on which recipients are allowed to vote their shares. As of March 31, 2015, we also had 0.4 million shares reserved for issuance under our stock option plans (0.3 million shares) and our restricted stock unit (“RSU”) plans (0.1 million shares). | |
The Company is authorized to repurchase up to an aggregate amount of $25.0 million (not including fees and expenses) of the Company’s outstanding shares of common stock. Under the stock repurchase program, purchases may be made from time to time in the open market, in accelerated stock buyback arrangements, in privately negotiated transactions or otherwise, subject to market prices and other conditions. There is no time limit placed on the duration of the program, which may be modified, extended or terminated by the Board of Directors (the “Board”) at any time. There were no shares repurchased under this authorization. | |
State Farm Mutual Automobile Insurance Company (“State Farm”) currently owns of record 5.2% of our outstanding common stock. In the three months ended March 31, 2015 and 2014, we incurred $0.7 million and $0.6 million, respectively, as compensation costs for the sale of our insurance and annuity products by entities that were either subsidiaries of State Farm or owned by State Farm agents. |
Separate_Accounts_Death_Benefi
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives | 3 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives [Abstract] | ||||||||||||||
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives | Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives | |||||||||||||
Separate accounts | ||||||||||||||
Separate account products are those for which a separate investment and liability account is maintained on behalf of the policyholder. Investment objectives for these separate accounts vary by fund account type, as outlined in the applicable fund prospectus or separate account plan of operations. We have variable annuity and variable life insurance contracts that are classified as separate account products. The assets supporting these contracts are carried at fair value and are reported as separate account assets with an equivalent amount reported as separate account liabilities. Amounts assessed against the policyholder for mortality, administration and other services are included within revenue in fee income. For the three months ended March 31, 2015 and 2014, there were no gains or losses on transfers of assets from the general account to a separate account. | ||||||||||||||
Assets with fair value and carrying value of $2.7 billion and $2.6 billion at March 31, 2015 and December 31, 2014, respectively, supporting fixed indexed annuities are maintained in accounts that are legally segregated from the other assets of the Company, but policyholders do not direct the investment of those assets and the investment performance does not pass through to the policyholders. These assets supporting fixed indexed annuity contracts are reported within the respective investment line items on the consolidated balance sheets. | ||||||||||||||
Separate Account Investments of Account Balances of Variable Annuity Contracts | March 31, | 31-Dec-14 | ||||||||||||
with Insurance Guarantees: | 2015 | |||||||||||||
($ in millions) | ||||||||||||||
Debt securities | $ | 361.9 | $ | 375.9 | ||||||||||
Equity funds | 1,598.70 | 1,638.60 | ||||||||||||
Other | 48.7 | 49.9 | ||||||||||||
Total | $ | 2,009.30 | $ | 2,064.40 | ||||||||||
Death benefits and other insurance benefit features | ||||||||||||||
Variable annuity guaranteed benefits | ||||||||||||||
We establish policy benefit liabilities for minimum death and income benefit guarantees relating to certain annuity policies as follows: | ||||||||||||||
• | Liabilities associated with the guaranteed minimum death benefit (“GMDB”) are determined by estimating the expected value of death benefits in excess of the projected account balance and recognizing the excess ratably over the expected life of the contract based on total expected assessments. The assumptions used for calculating the liabilities are generally consistent with those used for amortizing DAC. | |||||||||||||
• | Liabilities associated with the guaranteed minimum income benefit (“GMIB”) are determined by estimating the expected value of the income benefits in excess of the projected account balance at the date of annuitization and recognizing the excess ratably over the accumulation period based on total expected assessments. The assumptions used for calculating such guaranteed income benefit liabilities are generally consistent with those used for amortizing DAC. | |||||||||||||
For variable annuities with GMDB and GMIB, reserves for these guarantees are calculated and recorded in policy liabilities and accruals on our consolidated balance sheets. Changes in the liability are recorded in policy benefits on our consolidated statements of income and comprehensive income. We regularly evaluate estimates used and adjust the additional liability balances, with a related charge or credit to benefit expense if actual experience or other evidence suggests that earlier assumptions should be revised. | ||||||||||||||
Changes in Guaranteed Insurance Benefit | Three Months Ended | |||||||||||||
Liability Balances: | March 31, 2015 | |||||||||||||
($ in millions) | Annuity | Annuity | ||||||||||||
GMDB | GMIB | |||||||||||||
Balance, beginning of period | $ | 21.4 | $ | 17.1 | ||||||||||
Incurred | (0.6 | ) | (2.5 | ) | ||||||||||
Paid | (0.6 | ) | — | |||||||||||
Assumption unlocking | 0.4 | — | ||||||||||||
Change due to net unrealized gains or losses included in AOCI | 0.1 | — | ||||||||||||
Balance, end of period | $ | 20.7 | $ | 14.6 | ||||||||||
Changes in Guaranteed Insurance Benefit | Three Months Ended | |||||||||||||
Liability Balances: | March 31, 2014 | |||||||||||||
($ in millions) | Annuity | Annuity | ||||||||||||
GMDB | GMIB | |||||||||||||
Balance, beginning of period | $ | 22.7 | $ | 9.8 | ||||||||||
Incurred | (0.1 | ) | (0.1 | ) | ||||||||||
Paid | (0.6 | ) | — | |||||||||||
Assumption unlocking | — | — | ||||||||||||
Change due to net unrealized gains or losses included in AOCI | 0.1 | (0.1 | ) | |||||||||||
Balance, end of period | $ | 22.1 | $ | 9.6 | ||||||||||
For those guarantees of benefits that are payable in the event of death, the net amount at risk (“NAR”) is generally defined as the benefit payable in excess of the current account balance at our balance sheet date. We have entered into reinsurance agreements to reduce the net amount of risk on certain death benefits. Following are the major types of death benefits currently in force as defined in Note 11 to our consolidated financial statements in the 2014 Form 10-K: | ||||||||||||||
GMDB and GMIB Benefits by Type: | 31-Mar-15 | |||||||||||||
($ in millions) | Account | NAR | NAR | Average | ||||||||||
Value | before | after | Attained Age | |||||||||||
Reinsurance | Reinsurance | of Annuitant | ||||||||||||
GMDB return of premium | $ | 638 | $ | 1.4 | $ | 1.4 | 64 | |||||||
GMDB step up | 1,685.70 | 104.8 | 10.5 | 64 | ||||||||||
GMDB earnings enhancement benefit (“EEB”) | 29.1 | — | — | 65 | ||||||||||
GMDB greater of annual step up and roll up | 22.4 | 4.8 | 4.8 | 69 | ||||||||||
Total GMDB at March 31, 2015 | 2,375.20 | $ | 111 | $ | 16.7 | |||||||||
Less: General account value with GMDB | 372.3 | |||||||||||||
Subtotal separate account liabilities with GMDB | 2,002.90 | |||||||||||||
Separate account liabilities without GMDB | 966.5 | |||||||||||||
Total separate account liabilities | $ | 2,969.40 | ||||||||||||
GMIB [1] at March 31, 2015 | $ | 308.3 | 65 | |||||||||||
GMDB and GMIB Benefits by Type: | 31-Dec-14 | |||||||||||||
($ in millions) | Account | NAR | NAR | Average | ||||||||||
Value | before | after | Attained Age | |||||||||||
Reinsurance | Reinsurance | of Annuitant | ||||||||||||
GMDB return of premium | $ | 661.5 | $ | 1.6 | $ | 1.6 | 63 | |||||||
GMDB step up | 1,723.20 | 112.2 | 13.4 | 64 | ||||||||||
GMDB earnings enhancement benefit (“EEB”) | 29.1 | — | — | 65 | ||||||||||
GMDB greater of annual step up and roll up | 22.7 | 4.8 | 4.8 | 69 | ||||||||||
Total GMDB at December 31, 2014 | 2,436.50 | $ | 118.6 | $ | 19.8 | |||||||||
Less: General account value with GMDB | 378.6 | |||||||||||||
Subtotal separate account liabilities with GMDB | 2,057.90 | |||||||||||||
Separate account liabilities without GMDB | 962.8 | |||||||||||||
Total separate account liabilities | $ | 3,020.70 | ||||||||||||
GMIB [1] at December 31, 2014 | $ | 319.6 | 65 | |||||||||||
——————— | ||||||||||||||
[1] | Policies with a GMIB also have a GMDB, however these benefits are not additive. When a policy terminates due to death, any NAR related to GMIB is released. Similarly, when a policy goes into benefit status on a GMIB, its GMDB NAR is released. | |||||||||||||
Fixed indexed annuity guaranteed benefits | ||||||||||||||
Many of our fixed indexed annuities contain guaranteed benefits. We establish policy benefit liabilities for minimum death and minimum withdrawal benefit guarantees relating to these policies as follows: | ||||||||||||||
• | Liabilities associated with the guaranteed minimum withdrawal benefit (“GMWB”) and Chronic Care guarantees are determined by estimating the value of the withdrawal benefits expected to be paid after the projected account value depletes and recognizing the value ratably over the accumulation period based on total expected assessments. Liabilities associated with the GMWB for the fixed indexed annuities differ from those contained on variable annuities in that the GMWB feature and the underlying contract, exclusive of the equity index crediting option, are fixed income instruments. | |||||||||||||
• | Liabilities associated with the GMDB are determined by estimating the expected value of death benefits in excess of the projected account balance and recognizing the excess ratably over the expected life of the contract based on total expected assessments. | |||||||||||||
The assumptions used for calculating GMWB, GMDB and Chronic Care guarantees are generally consistent with those used for amortizing DAC. We regularly evaluate estimates used and adjust the additional liability balances, with a related charge or credit to benefit expense if actual experience or other evidence suggests that earlier assumptions should be revised. The GMWB, GMDB and Chronic Care guarantees on fixed indexed annuities are recorded in policy liabilities and accruals on our consolidated balance sheets. | ||||||||||||||
Changes in Guaranteed | Fixed Indexed Annuity | |||||||||||||
Liability Balances: | GMWB and GMDB | |||||||||||||
($ in millions) | Three Months Ended | |||||||||||||
March 31, | ||||||||||||||
2015 | 2014 | |||||||||||||
Balance, beginning of period | $ | 147 | $ | 85.4 | ||||||||||
Incurred | 10.5 | 0.3 | ||||||||||||
Paid | (0.1 | ) | (0.1 | ) | ||||||||||
Assumption unlocking | — | — | ||||||||||||
Change due to net unrealized gains or losses included in AOCI | 13.9 | 18.5 | ||||||||||||
Balance, end of period | $ | 171.3 | $ | 104.1 | ||||||||||
Universal life | ||||||||||||||
Liabilities for universal life contracts in excess of the account balance, some of which contain secondary guarantees, are generally determined by estimating the expected value of benefits and expenses when claims are triggered and recognizing those benefits and expenses over the accumulation period based on total expected assessments. The assumptions used in estimating these liabilities are generally consistent with those used for amortizing DAC. | ||||||||||||||
Changes in Guaranteed | Universal Life | |||||||||||||
Liability Balances: | Secondary Guarantees | |||||||||||||
($ in millions) | Three Months Ended | |||||||||||||
March 31, | ||||||||||||||
2015 | 2014 | |||||||||||||
Balance, beginning of period | $ | 195.8 | $ | 170.6 | ||||||||||
Incurred | 10.1 | 8.4 | ||||||||||||
Paid | (6.4 | ) | (1.9 | ) | ||||||||||
Assumption unlocking | — | — | ||||||||||||
Change due to net unrealized gains or losses included in AOCI | 1.4 | 0.9 | ||||||||||||
Balance, end of period | $ | 200.9 | $ | 178 | ||||||||||
In addition, the universal life block of business has experience which produces profits in earlier periods followed by losses in later periods for which additional reserves are required to be held above the account value liability. These reserves are accrued ratably over historical and anticipated positive income to offset the future anticipated losses. The assumptions used in estimating these liabilities are generally consistent with those used for amortizing DAC. | ||||||||||||||
Changes in Additional | Universal Life | |||||||||||||
Liability Balances: | Profits Followed by Losses | |||||||||||||
($ in millions) | Three Months Ended | |||||||||||||
March 31, | ||||||||||||||
2015 | 2014 | |||||||||||||
Balance, beginning of period | $ | 351.5 | $ | 249.1 | ||||||||||
Incurred | 16.7 | 16.1 | ||||||||||||
Assumption unlocking | (6.8 | ) | — | |||||||||||
Change due to net unrealized gains or losses included in AOCI | 26.3 | 14.7 | ||||||||||||
Balance, end of period | $ | 387.7 | $ | 279.9 | ||||||||||
Embedded derivatives | ||||||||||||||
Variable annuity embedded derivatives | ||||||||||||||
Certain separate account variable products may contain a GMWB, guaranteed minimum accumulation benefit (“GMAB”) and/or combination (“COMBO”) rider as defined in Note 11 to our consolidated financial statements in the 2014 Form 10-K. These features are accounted for as embedded derivatives as described below. | ||||||||||||||
Embedded Derivatives Non-Insurance Guaranteed Product Features: | 31-Mar-15 | |||||||||||||
($ in millions) | Account | Average | ||||||||||||
Value | Attained Age | |||||||||||||
of Annuitant | ||||||||||||||
GMWB | $ | 477.7 | 65 | |||||||||||
GMAB | 300.6 | 59 | ||||||||||||
COMBO | 5.4 | 64 | ||||||||||||
Balance, end of period | $ | 783.7 | ||||||||||||
Embedded Derivatives Non-Insurance Guaranteed Product Features: | 31-Dec-14 | |||||||||||||
($ in millions) | Account | Average | ||||||||||||
Value | Attained Age | |||||||||||||
of Annuitant | ||||||||||||||
GMWB | $ | 496.8 | 65 | |||||||||||
GMAB | 315.6 | 59 | ||||||||||||
COMBO | 7.1 | 65 | ||||||||||||
Balance, end of period | $ | 819.5 | ||||||||||||
The GMWB, GMAB and COMBO features represent embedded derivative liabilities in the variable annuity contracts that are required to be reported separately from the host variable annuity contract. These liabilities are recorded at fair value within policyholder deposit funds on the consolidated balance sheets with changes in fair value recorded in realized investment gains on the consolidated statements of income and comprehensive income. The fair value of the GMWB, GMAB and COMBO obligation is calculated based on actuarial and capital market assumptions related to the projected cash flows, including benefits and related contract charges, over the lives of the contracts, incorporating expectations concerning policyholder behavior. As markets change, contracts mature and actual policyholder behavior emerges, these assumptions are continually evaluated and may from time to time be adjusted. Embedded derivative liabilities for GMWB, GMAB and COMBO are shown in the table below. | ||||||||||||||
Embedded Derivative Liabilities: | March 31, | 31-Dec-14 | ||||||||||||
($ in millions) | 2015 | |||||||||||||
GMWB | $ | 9.5 | $ | 7.3 | ||||||||||
GMAB | (0.7 | ) | (0.3 | ) | ||||||||||
COMBO | (0.1 | ) | (0.2 | ) | ||||||||||
Total variable annuity embedded derivative liabilities | $ | 8.7 | $ | 6.8 | ||||||||||
There were no benefit payments made for the GMWB and GMAB in the three months ended March 31, 2015 and 2014. We have established a risk management strategy under which we hedge our GMAB, GMWB and COMBO exposure using equity index options, equity index futures, equity index variance swaps, interest rate swaps and swaptions. | ||||||||||||||
Fixed indexed annuity embedded derivatives | ||||||||||||||
Fixed indexed annuities may also contain a variety of index-crediting options: policy credits that are calculated based on the performance of an outside equity market or other index over a specified term. These index options are embedded derivative liabilities that are required to be reported separately from the host contract. These index options are accounted for at fair value and recorded in policyholder deposits within the consolidated balance sheets with changes in fair value recorded in realized investment gains, in the consolidated statements of income and comprehensive income. The fair value of these index options is calculated using the budget method. See Note 13 to these consolidated interim unaudited financial statements for additional information. Several additional inputs reflect our internally developed assumptions related to lapse rates and other policyholder behavior. The fair value of these embedded derivatives was $166.9 million and $153.9 million as of March 31, 2015 and December 31, 2014, respectively. In order to manage the risk associated with these equity indexed-crediting features, we hedge using equity index options. See Note 12 to these consolidated interim unaudited financial statements for additional information. | ||||||||||||||
Embedded derivatives realized gains and losses | ||||||||||||||
Changes in the fair value of embedded derivatives associated with variable annuity and fixed indexed annuity contracts are recorded as realized investment gains and losses within the consolidated statements of income and comprehensive income. Embedded derivatives gains and (losses) recognized in earnings for the three months ended March 31, 2015 and 2014 are $(10.3) million and $(12.9) million, respectively. |
Derivative_Instruments
Derivative Instruments | 3 Months Ended | |||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||
Derivative Instruments | Derivative Instruments | |||||||||||||||||||||||
We use derivative financial instruments, including options, futures and swaps as a means of hedging exposure to interest rate, equity price change, equity volatility and foreign currency risk. This includes our surplus hedge which utilizes futures and options to hedge against declines in equity markets and the resulting statutory capital and surplus impact, as well as our fixed indexed annuity (“FIA”) separate account hedge which uses interest rate swaptions to hedge against rising interest rates. We also use derivative instruments to economically hedge our exposure on living benefits offered on certain of our variable annuity products as well as index credits on our FIA products. | ||||||||||||||||||||||||
The Company seeks to enter into over-the-counter (“OTC”) derivative transactions pursuant to master agreements that provide for a netting of payments and receipts by counterparty. As of March 31, 2015 and December 31, 2014, $22.6 million and $18.6 million, respectively, of cash and cash equivalents were held as collateral by a third party related to our derivative transactions. | ||||||||||||||||||||||||
Our derivatives are not designated as hedges for accounting purposes. | ||||||||||||||||||||||||
Derivative Instruments: | Maturity | Notional | Fair Value as of | |||||||||||||||||||||
Amount | March 31, 2015 | |||||||||||||||||||||||
($ in millions) | Assets | Liabilities [1] | ||||||||||||||||||||||
Interest rate swaps | 2018 - 2035 | $ | 149 | $ | 4 | $ | 0.4 | |||||||||||||||||
Variance swaps | 2015 - 2017 | 0.9 | — | 9 | ||||||||||||||||||||
Put options | 2015 - 2022 | 692.5 | 26.8 | — | ||||||||||||||||||||
Call options [2] | 2015 - 2019 | 2,169.30 | 107.7 | 67.7 | ||||||||||||||||||||
Cross currency swaps | 2016 | 10 | 1.7 | — | ||||||||||||||||||||
Equity futures | 2015 | 9.6 | — | — | ||||||||||||||||||||
Total derivative instruments | $ | 3,031.30 | $ | 140.2 | $ | 77.1 | ||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Derivative liabilities are included in other liabilities on the consolidated balance sheets. | |||||||||||||||||||||||
[2] | Includes a contingent receivable of $1.4 million. | |||||||||||||||||||||||
Derivative Instruments: | Maturity | Notional | Fair Value as of | |||||||||||||||||||||
Amount | December 31, 2014 | |||||||||||||||||||||||
($ in millions) | Assets | Liabilities [1] | ||||||||||||||||||||||
Interest rate swaps | 2016 - 2029 | $ | 114 | $ | 9.7 | $ | 1.9 | |||||||||||||||||
Variance swaps | 2015 - 2017 | 0.9 | — | 8.6 | ||||||||||||||||||||
Swaptions | 2024 - 2025 | 777 | 0.1 | — | ||||||||||||||||||||
Put options | 2015 - 2022 | 692.5 | 31.1 | — | ||||||||||||||||||||
Call options [2] | 2015 - 2019 | 2,019.20 | 119.8 | 74.6 | ||||||||||||||||||||
Cross currency swaps | 2016 | 10 | 0.6 | — | ||||||||||||||||||||
Equity futures | 2015 | 4.1 | — | 0.5 | ||||||||||||||||||||
Total derivative instruments | $ | 3,617.70 | $ | 161.3 | $ | 85.6 | ||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Derivative liabilities are included in other liabilities on the consolidated balance sheets. | |||||||||||||||||||||||
[2] | Includes a contingent receivable of $1.5 million. | |||||||||||||||||||||||
Derivative Instrument Gains (Losses) Recognized in | Three Months Ended | |||||||||||||||||||||||
Realized Investment Gains (Losses): | March 31, | |||||||||||||||||||||||
($ in millions) | 2015 | 2014 | ||||||||||||||||||||||
Interest rate swaps | $ | 2.7 | $ | 5 | ||||||||||||||||||||
Variance swaps | (0.4 | ) | (0.6 | ) | ||||||||||||||||||||
Swaptions | (0.1 | ) | (18.3 | ) | ||||||||||||||||||||
Put options | (4.2 | ) | (4.2 | ) | ||||||||||||||||||||
Call options | (1.5 | ) | (3.0 | ) | ||||||||||||||||||||
Cross currency swaps | 1 | (0.1 | ) | |||||||||||||||||||||
Equity futures | 0.2 | (2.6 | ) | |||||||||||||||||||||
Embedded derivatives | (10.3 | ) | (12.9 | ) | ||||||||||||||||||||
Total derivative instrument gains (losses) recognized in | $ | (12.6 | ) | $ | (36.7 | ) | ||||||||||||||||||
realized investment gains (losses) | ||||||||||||||||||||||||
Offsetting of Derivative Assets/Liabilities | ||||||||||||||||||||||||
The Company may enter into netting agreements with counterparties that permit the Company to offset receivables and payables with such counterparties. The following tables present the gross fair value amounts, the amounts offset and net position of derivative instruments eligible for offset in the Company’s consolidated balance sheets that are subject to an enforceable master netting arrangement upon certain termination events, irrespective of whether they are offset in the balance sheet. | ||||||||||||||||||||||||
Offsetting of | March 31, 2015 | |||||||||||||||||||||||
Derivative Assets/Liabilities: | ||||||||||||||||||||||||
($ in millions) | Gross | Gross | Net amounts | Gross amounts not offset | Net amount | |||||||||||||||||||
amounts | amounts | presented | in the balance sheet | |||||||||||||||||||||
recognized [1] | offset in the | in the | ||||||||||||||||||||||
balance sheet | balance sheet | Financial | Cash collateral | |||||||||||||||||||||
instruments | pledged [2] | |||||||||||||||||||||||
Total derivative assets | $ | 140.2 | $ | — | $ | 140.2 | $ | (73.4 | ) | $ | — | $ | 66.8 | |||||||||||
Total derivative liabilities | $ | (77.1 | ) | $ | — | $ | (77.1 | ) | $ | 73.4 | $ | 3.7 | $ | — | ||||||||||
Offsetting of | December 31, 2014 | |||||||||||||||||||||||
Derivative Assets/Liabilities: | ||||||||||||||||||||||||
($ in millions) | Gross | Gross | Net amounts | Gross amounts not offset | Net amount | |||||||||||||||||||
amounts | amounts | presented | in the balance sheet | |||||||||||||||||||||
recognized [1] | offset in the | in the | ||||||||||||||||||||||
balance sheet | balance sheet | Financial | Cash collateral | |||||||||||||||||||||
instruments | pledged [2] | |||||||||||||||||||||||
Total derivative assets | $ | 161.3 | $ | — | $ | 161.3 | $ | (82.5 | ) | $ | — | $ | 78.8 | |||||||||||
Total derivative liabilities | $ | (85.6 | ) | $ | — | $ | (85.6 | ) | $ | 82.5 | $ | 3.1 | $ | — | ||||||||||
——————— | ||||||||||||||||||||||||
[1] | Amounts include all derivative instruments, irrespective of whether there is a legally enforceable master netting arrangement in place. | |||||||||||||||||||||||
[2] | Cash collateral pledged with derivative counterparties is recorded within other assets on the consolidated balance sheets. The Company pledges cash collateral to offset certain individual derivative liability positions with certain counterparties. Cash collateral of $18.9 million and $15.5 million as of March 31, 2015 and December 31, 2014, respectively, that exceeds the net liability resulting from the aggregate derivative positions with a corresponding counterparty is excluded. | |||||||||||||||||||||||
Contingent features | ||||||||||||||||||||||||
Derivative counterparty agreements may contain certain provisions that require our insurance companies’ financial strength rating to be above a certain threshold. If our financial strength ratings were to fall below a specified rating threshold, certain derivative counterparties could request immediate payment or demand immediate and ongoing full collateralization on derivative instruments in net liability positions, or trigger a termination of existing derivatives and/or future derivative transactions. | ||||||||||||||||||||||||
In certain derivative counterparty agreements, our financial strength ratings are below the specified threshold levels. However, the Company held no derivative instruments as of March 31, 2015 in a net aggregate liability position payable to any counterparty (i.e., such derivative instruments have fair values in a net asset position payable to the Company if such holdings were liquidated). |
Fair_Value_of_Financial_Instru
Fair Value of Financial Instruments | 3 Months Ended | |||||||||||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||
Fair Value of Financial Instruments | Fair Value of Financial Instruments | |||||||||||||||||||||||||||||||
ASC 820-10 defines and establishes the framework for measuring fair value. The framework is based on inputs that are used in the valuation and a fair value hierarchy based on the quality of those inputs. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. | ||||||||||||||||||||||||||||||||
A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The input levels are defined as follows: | ||||||||||||||||||||||||||||||||
• | Level 1 – inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 1 securities include highly liquid government bonds and exchange-traded equities. | |||||||||||||||||||||||||||||||
• | Level 2 – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Examples of such instruments include government-backed mortgage products, certain collateralized mortgage and debt obligations and certain high-yield debt securities. | |||||||||||||||||||||||||||||||
• | Level 3 – inputs to the valuation methodology are unobservable and significant to the fair value measurement. Unobservable inputs reflect management’s own assumptions about inputs in which market participants would use in pricing these types of assets or liabilities. Level 3 financial instruments include values which are determined using pricing models and third-party evaluation. Additionally, the determination of some fair value estimates utilizes significant management judgments or best estimates. | |||||||||||||||||||||||||||||||
The following tables present the financial instruments carried at fair value on a recurring basis by ASC 820-10 valuation hierarchy (as described above). There were no financial instruments carried at fair value on a non-recurring basis as of March 31, 2015 and December 31, 2014, respectively. | ||||||||||||||||||||||||||||||||
Fair Values of Financial Instruments by Level: | 31-Mar-15 | |||||||||||||||||||||||||||||||
($ in millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [1] | $ | — | $ | 80.3 | $ | 366.4 | $ | 446.7 | ||||||||||||||||||||||||
State and political subdivision | — | 175.1 | 405.4 | 580.5 | ||||||||||||||||||||||||||||
Foreign government | — | 215.6 | 32.4 | 248 | ||||||||||||||||||||||||||||
Corporate | — | 4,358.00 | 4,354.10 | 8,712.10 | ||||||||||||||||||||||||||||
CMBS | — | 615.7 | 35.2 | 650.9 | ||||||||||||||||||||||||||||
RMBS | — | 1,389.30 | 481.6 | 1,870.90 | ||||||||||||||||||||||||||||
CDO/CLO | — | — | 205.5 | 205.5 | ||||||||||||||||||||||||||||
Other ABS | — | 61.8 | 208.9 | 270.7 | ||||||||||||||||||||||||||||
Total available-for-sale debt securities | — | 6,895.80 | 6,089.50 | 12,985.30 | ||||||||||||||||||||||||||||
Available-for-sale equity securities | — | — | 175.5 | 175.5 | ||||||||||||||||||||||||||||
Short-term investments | 154.7 | — | — | 154.7 | ||||||||||||||||||||||||||||
Derivative assets | — | 140.2 | — | 140.2 | ||||||||||||||||||||||||||||
Fair value investments [2] | 32.7 | 13.2 | 204.9 | 250.8 | ||||||||||||||||||||||||||||
Separate account assets | 2,969.40 | — | — | 2,969.40 | ||||||||||||||||||||||||||||
Total assets | $ | 3,156.80 | $ | 7,049.20 | $ | 6,469.90 | $ | 16,675.90 | ||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||
Derivative liabilities | $ | — | $ | 77.1 | $ | — | $ | 77.1 | ||||||||||||||||||||||||
Embedded derivatives | — | — | 175.6 | 175.6 | ||||||||||||||||||||||||||||
Total liabilities | $ | — | $ | 77.1 | $ | 175.6 | $ | 252.7 | ||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Level 3 includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
[2] | Fair value investments at March 31, 2015 include $115.0 million of debt securities recorded at fair value. In addition, we have also elected the fair value option for equity securities backing our deferred compensation liabilities at $23.8 million as of March 31, 2015. Changes in the fair value of these assets are recorded through net investment income. Additionally, $112.0 million of assets relate to investment holdings of consolidated VIEs held at fair value, $8.9 million of which are Level 1 securities. | |||||||||||||||||||||||||||||||
There were no transfers of assets between Level 1 and Level 2 during the three months ended March 31, 2015. | ||||||||||||||||||||||||||||||||
Fair Values of Financial Instruments by Level: | 31-Dec-14 | |||||||||||||||||||||||||||||||
($ in millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [1] | $ | — | $ | 81.2 | $ | 362.2 | $ | 443.4 | ||||||||||||||||||||||||
State and political subdivision | — | 157.7 | 400.2 | 557.9 | ||||||||||||||||||||||||||||
Foreign government | — | 177.3 | 53.6 | 230.9 | ||||||||||||||||||||||||||||
Corporate | — | 3,994.20 | 4,403.90 | 8,398.10 | ||||||||||||||||||||||||||||
CMBS | — | 498.4 | 152.8 | 651.2 | ||||||||||||||||||||||||||||
RMBS | — | 1,461.90 | 470.3 | 1,932.20 | ||||||||||||||||||||||||||||
CDO/CLO | — | — | 196.9 | 196.9 | ||||||||||||||||||||||||||||
Other ABS | — | 23.6 | 245.1 | 268.7 | ||||||||||||||||||||||||||||
Total available-for-sale debt securities | — | 6,394.30 | 6,285.00 | 12,679.30 | ||||||||||||||||||||||||||||
Available-for-sale equity securities | — | — | 179.5 | 179.5 | ||||||||||||||||||||||||||||
Short-term investments | 149.7 | — | — | 149.7 | ||||||||||||||||||||||||||||
Derivative assets | — | 161.3 | — | 161.3 | ||||||||||||||||||||||||||||
Fair value investments [2] | 32.4 | 13 | 190 | 235.4 | ||||||||||||||||||||||||||||
Separate account assets | 3,020.70 | — | — | 3,020.70 | ||||||||||||||||||||||||||||
Total assets | $ | 3,202.80 | $ | 6,568.60 | $ | 6,654.50 | $ | 16,425.90 | ||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||
Derivative liabilities | $ | 0.5 | $ | 85.1 | $ | — | $ | 85.6 | ||||||||||||||||||||||||
Embedded derivatives | — | — | 160.7 | 160.7 | ||||||||||||||||||||||||||||
Total liabilities | $ | 0.5 | $ | 85.1 | $ | 160.7 | $ | 246.3 | ||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Level 3 includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
[2] | Fair value investments at December 31, 2014 include $111.9 million of debt securities recorded at fair value. In addition, we have also elected the fair value option for equity securities backing our deferred compensation liabilities at $23.5 million as of December 31, 2014. Changes in the fair value of these assets are recorded through net investment income. Additionally, $100.0 million of assets relate to investment holdings of consolidated VIEs held at fair value, $8.8 million of which are Level 1 securities. | |||||||||||||||||||||||||||||||
There were no transfers of assets between Level 1 and Level 2 during the three months ended March 31, 2014. | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities as of March 31, 2015 and December 31, 2014, respectively, are reported net of $27.9 million and $27.8 million of Level 2 investments included in discontinued operations assets on the consolidated balance sheets related to discontinued reinsurance operations. | ||||||||||||||||||||||||||||||||
The following tables present corporates carried at fair value and on a recurring basis by sector. | ||||||||||||||||||||||||||||||||
Fair Values of Corporates by Level and Sector: | 31-Mar-15 | |||||||||||||||||||||||||||||||
($ in millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||||
Corporates | ||||||||||||||||||||||||||||||||
Consumer | $ | — | $ | 618.3 | $ | 1,286.80 | $ | 1,905.10 | ||||||||||||||||||||||||
Energy | — | 614.7 | 443.1 | 1,057.80 | ||||||||||||||||||||||||||||
Financial services | — | 1,785.70 | 898.1 | 2,683.80 | ||||||||||||||||||||||||||||
Capital goods | — | 402.7 | 352.5 | 755.2 | ||||||||||||||||||||||||||||
Transportation | — | 120.7 | 313.5 | 434.2 | ||||||||||||||||||||||||||||
Utilities | — | 372.7 | 719.3 | 1,092.00 | ||||||||||||||||||||||||||||
Other | — | 443.2 | 340.8 | 784 | ||||||||||||||||||||||||||||
Total corporates | $ | — | $ | 4,358.00 | $ | 4,354.10 | $ | 8,712.10 | ||||||||||||||||||||||||
Fair Values of Corporates by Level and Sector: | 31-Dec-14 | |||||||||||||||||||||||||||||||
($ in millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||||
Corporates | ||||||||||||||||||||||||||||||||
Consumer | $ | — | $ | 593 | $ | 1,266.60 | $ | 1,859.60 | ||||||||||||||||||||||||
Energy | — | 534.6 | 472.8 | 1,007.40 | ||||||||||||||||||||||||||||
Financial services | — | 1,617.30 | 967.9 | 2,585.20 | ||||||||||||||||||||||||||||
Capital goods | — | 398.1 | 384.8 | 782.9 | ||||||||||||||||||||||||||||
Transportation | — | 104.7 | 305.8 | 410.5 | ||||||||||||||||||||||||||||
Utilities | — | 348.1 | 683.4 | 1,031.50 | ||||||||||||||||||||||||||||
Other | — | 398.4 | 322.6 | 721 | ||||||||||||||||||||||||||||
Total corporates | $ | — | $ | 3,994.20 | $ | 4,403.90 | $ | 8,398.10 | ||||||||||||||||||||||||
Level 3 financial assets and liabilities | ||||||||||||||||||||||||||||||||
The following tables set forth a summary of changes in the fair value of our Level 3 financial assets and liabilities. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Transfers in and out of Level 3 occur at the beginning of each period. The securities which were transferred into Level 3 were due to decreased market observability of similar assets and/or changes to significant inputs, such as downgrades or price declines. Transfers out of Level 3 were due to increased market activity on comparable assets or observability of inputs. | ||||||||||||||||||||||||||||||||
Level 3 Financial Assets: | Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||
($ in millions) | Balance, | Purchases | Sales | Transfers | Transfers | Realized and | Unrealized | Total | ||||||||||||||||||||||||
beginning | into | out of | unrealized | gains | ||||||||||||||||||||||||||||
of period | Level 3 | Level 3 | gains | (losses) | ||||||||||||||||||||||||||||
(losses) | included | |||||||||||||||||||||||||||||||
included in | in OCI | |||||||||||||||||||||||||||||||
income [1] | ||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [2] | $ | 362.2 | $ | — | $ | (2.1 | ) | $ | — | $ | — | $ | — | $ | 6.3 | $ | 366.4 | |||||||||||||||
State and political subdivision | 400.2 | 13.6 | (2.2 | ) | — | (14.0 | ) | — | 7.8 | 405.4 | ||||||||||||||||||||||
Foreign government | 53.6 | — | (0.2 | ) | 4.2 | (26.7 | ) | — | 1.5 | 32.4 | ||||||||||||||||||||||
Corporate | 4,403.90 | 220.3 | (113.0 | ) | 62.3 | (285.2 | ) | 2.1 | 63.7 | 4,354.10 | ||||||||||||||||||||||
CMBS | 152.8 | — | (0.1 | ) | 8.5 | (126.1 | ) | — | 0.1 | 35.2 | ||||||||||||||||||||||
RMBS | 470.3 | 0.3 | (17.6 | ) | 29.2 | — | (0.2 | ) | (0.4 | ) | 481.6 | |||||||||||||||||||||
CDO/CLO | 196.9 | 24.5 | (18.4 | ) | — | — | 0.5 | 2 | 205.5 | |||||||||||||||||||||||
Other ABS | 245.1 | — | (7.0 | ) | — | (29.2 | ) | (0.4 | ) | 0.4 | 208.9 | |||||||||||||||||||||
Total available-for-sale | 6,285.00 | 258.7 | (160.6 | ) | 104.2 | (481.2 | ) | 2 | 81.4 | 6,089.50 | ||||||||||||||||||||||
debt securities | ||||||||||||||||||||||||||||||||
Available-for-sale equity securities | 179.5 | 7.2 | (1.7 | ) | — | — | (6.2 | ) | (3.3 | ) | 175.5 | |||||||||||||||||||||
Fair value investments | 190 | 0.4 | (1.9 | ) | — | — | 16.4 | — | 204.9 | |||||||||||||||||||||||
Total assets | $ | 6,654.50 | $ | 266.3 | $ | (164.2 | ) | $ | 104.2 | $ | (481.2 | ) | $ | 12.2 | $ | 78.1 | $ | 6,469.90 | ||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Reflected in realized investment gains and losses for all assets except fair value investments which are included in net investment income. | |||||||||||||||||||||||||||||||
[2] | Includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
Level 3 Financial Assets: | Three Months Ended March 31, 2014 | |||||||||||||||||||||||||||||||
($ in millions) | Balance, | Purchases | Sales | Transfers | Transfers | Realized and | Unrealized | Total | ||||||||||||||||||||||||
beginning | into | out of | unrealized | gains | ||||||||||||||||||||||||||||
of period | Level 3 | Level 3 | gains | (losses) | ||||||||||||||||||||||||||||
(losses) | included | |||||||||||||||||||||||||||||||
included in | in OCI | |||||||||||||||||||||||||||||||
income [1] | ||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [2] | $ | 327.2 | $ | 12.9 | $ | (5.4 | ) | $ | — | $ | — | $ | — | $ | 5.7 | $ | 340.4 | |||||||||||||||
State and political subdivision | 269.1 | 2.9 | (0.8 | ) | — | — | — | 5.6 | 276.8 | |||||||||||||||||||||||
Foreign government | 15.9 | — | (1.0 | ) | — | — | — | 1.2 | 16.1 | |||||||||||||||||||||||
Corporate | 3,893.80 | 171 | (115.9 | ) | — | (127.0 | ) | 2.5 | 115.9 | 3,940.30 | ||||||||||||||||||||||
CMBS | 113.7 | — | (2.7 | ) | — | (60.1 | ) | (0.1 | ) | 1.3 | 52.1 | |||||||||||||||||||||
RMBS | 552.7 | 0.5 | (21.7 | ) | — | — | 1.9 | 1.8 | 535.2 | |||||||||||||||||||||||
CDO/CLO | 224.1 | 23 | (12.3 | ) | — | — | 1.8 | (0.5 | ) | 236.1 | ||||||||||||||||||||||
Other ABS | 247.7 | — | (13.3 | ) | — | (1.7 | ) | 0.1 | (3.4 | ) | 229.4 | |||||||||||||||||||||
Total available-for-sale | 5,644.20 | 210.3 | (173.1 | ) | — | (188.8 | ) | 6.2 | 127.6 | 5,626.40 | ||||||||||||||||||||||
debt securities | ||||||||||||||||||||||||||||||||
Available-for-sale equity securities | 135.2 | 6.7 | (1.3 | ) | — | — | 0.5 | (78.1 | ) | 63 | ||||||||||||||||||||||
Short-term investments | 0.9 | — | — | — | — | — | (0.9 | ) | — | |||||||||||||||||||||||
Fair value investments | 169.9 | — | (2.5 | ) | — | — | 2.9 | — | 170.3 | |||||||||||||||||||||||
Total assets | $ | 5,950.20 | $ | 217 | $ | (176.9 | ) | $ | — | $ | (188.8 | ) | $ | 9.6 | $ | 48.6 | $ | 5,859.70 | ||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Reflected in realized investment gains and losses for all assets except fair value investments which are included in net investment income. | |||||||||||||||||||||||||||||||
[2] | Includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
Level 3 Financial Liabilities: | Embedded Derivative Liabilities | |||||||||||||||||||||||||||||||
($ in millions) | Three Months Ended | |||||||||||||||||||||||||||||||
March 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||||||||||
Balance, beginning of period | $ | 160.7 | $ | 87.8 | ||||||||||||||||||||||||||||
Net purchases/(sales) | 4.6 | 8.3 | ||||||||||||||||||||||||||||||
Transfers into Level 3 | — | — | ||||||||||||||||||||||||||||||
Transfers out of Level 3 | — | — | ||||||||||||||||||||||||||||||
Realized (gains) losses | 10.3 | 12.9 | ||||||||||||||||||||||||||||||
Balance, end of period | $ | 175.6 | $ | 109 | ||||||||||||||||||||||||||||
Significant unobservable inputs used in the fair value measurement of Level 3 assets are yield, prepayment rate, default rate and recovery rate. Keeping other inputs unchanged, an increase in yield, default rate or prepayment rate would decrease the fair value of the asset while an increase in recovery rate would result in an increase to the fair value of the asset. Yields are a function of the underlying U.S. Treasury rates and asset spreads, and changes in default and recovery rates are dependent on overall market conditions. | ||||||||||||||||||||||||||||||||
The following tables present quantitative estimates about unobservable inputs used in the fair value measurement of significant categories of internally priced assets. | ||||||||||||||||||||||||||||||||
Level 3 Assets: [1] | 31-Mar-15 | |||||||||||||||||||||||||||||||
($ in millions) | Fair | Valuation | Unobservable | Range | ||||||||||||||||||||||||||||
Value | Technique(s) | Input | (Weighted Average) | |||||||||||||||||||||||||||||
U.S. government and agency | $ | 366.4 | Discounted cash flow | Yield | 0.86% - 4.04% (2.91%) | |||||||||||||||||||||||||||
State and political subdivision | $ | 208 | Discounted cash flow | Yield | 1.85% - 4.25% (2.91%) | |||||||||||||||||||||||||||
Corporate | $ | 3,351.60 | Discounted cash flow | Yield | 0.85% - 6.56% (2.96%) | |||||||||||||||||||||||||||
Other ABS | $ | 38 | Discounted cash flow | Yield | 0.70% - 2.60% (1.69%) | |||||||||||||||||||||||||||
Fair value investments | $ | 6.4 | Discounted cash flow | Default rate | 0.18% | |||||||||||||||||||||||||||
Recovery rate | 44.00% | |||||||||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Excludes Level 3 assets which are valued based upon non-binding independent third-party valuations or third-party price information for which unobservable inputs are not reasonably available to us. | |||||||||||||||||||||||||||||||
Level 3 Assets: [1] | 31-Dec-14 | |||||||||||||||||||||||||||||||
($ in millions) | Fair | Valuation | Unobservable | Range | ||||||||||||||||||||||||||||
Value | Technique(s) | Input | (Weighted Average) | |||||||||||||||||||||||||||||
U.S. government and agency | $ | 362.2 | Discounted cash flow | Yield | 0.99% - 4.27% (3.17%) | |||||||||||||||||||||||||||
State and political subdivision | $ | 159.1 | Discounted cash flow | Yield | 2.15% - 4.50% (3.22%) | |||||||||||||||||||||||||||
Corporate | $ | 3,116.60 | Discounted cash flow | Yield | 0.93% - 6.88% (3.24%) | |||||||||||||||||||||||||||
Other ABS | $ | 39.3 | Discounted cash flow | Yield | 0.60% - 4.00% (1.92%) | |||||||||||||||||||||||||||
Fair value investments | $ | 6.3 | Discounted cash flow | Default rate | 0.17% | |||||||||||||||||||||||||||
Recovery rate | 44.00% | |||||||||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Excludes Level 3 assets which are valued based upon non-binding independent third-party valuations or third-party price information for which unobservable inputs are not reasonably available to us. | |||||||||||||||||||||||||||||||
Significant unobservable inputs used in the fair value measurement of variable annuity (“VA”) GMAB and GMWB type liabilities are equity volatility, swap curve, mortality and lapse rates and an adjustment for non-performance risk. Keeping other inputs unchanged, an increase in the equity volatility would increase the fair value of the liability while an increase in the swap curve or credit standing adjustment (“CSA”) would result in a decrease to the fair value of the liability. The impact of changes in mortality and lapse rates are dependent on overall market conditions. The fair value of fixed indexed annuity and indexed universal life embedded derivative related to index credits is calculated using the swap curve, future option budget, mortality and lapse rates, as well as an adjustment for non-performance risk. Keeping other inputs unchanged, an increase in any of these significant unobservable inputs would result in a decrease of the fixed indexed annuity embedded derivative liability. | ||||||||||||||||||||||||||||||||
The following tables present quantitative estimates about unobservable inputs used in the fair value measurement of internally priced liabilities. | ||||||||||||||||||||||||||||||||
Level 3 Liabilities: | 31-Mar-15 | |||||||||||||||||||||||||||||||
($ in millions) | Fair | Valuation | Unobservable | Range | ||||||||||||||||||||||||||||
Value | Technique(s) | Input | ||||||||||||||||||||||||||||||
Embedded derivatives (VA / FIA) | $ | 166.9 | Budget method | Swap curve | 0.31% - 2.27% | |||||||||||||||||||||||||||
Mortality rate | 105% or 97 % 2012 IAM basic table | |||||||||||||||||||||||||||||||
with scale G2 | ||||||||||||||||||||||||||||||||
Lapse rate | 0.04% - 46.44% | |||||||||||||||||||||||||||||||
CSA | 3.19% | |||||||||||||||||||||||||||||||
Embedded derivatives | $ | 8.7 | Risk neutral stochastic | Volatility surface | 8.58% - 50.72% | |||||||||||||||||||||||||||
(GMAB / GMWB / COMBO) | valuation methodology | |||||||||||||||||||||||||||||||
Swap curve | 0.22% - 2.44% | |||||||||||||||||||||||||||||||
Mortality rate | 105% 2012 IAM basic table | |||||||||||||||||||||||||||||||
with scale G2 | ||||||||||||||||||||||||||||||||
Lapse rate | 0.00% - 40.00% | |||||||||||||||||||||||||||||||
CSA | 3.19% | |||||||||||||||||||||||||||||||
Level 3 Liabilities: | 31-Dec-14 | |||||||||||||||||||||||||||||||
($ in millions) | Fair | Valuation | Unobservable | Range | ||||||||||||||||||||||||||||
Value | Technique(s) | Input | ||||||||||||||||||||||||||||||
Embedded derivatives (VA / FIA) | $ | 153.9 | Budget method | Swap curve | 0.24% - 2.55% | |||||||||||||||||||||||||||
Mortality rate | 105% or 97% 2012 IAM basic table | |||||||||||||||||||||||||||||||
with scale G2 | ||||||||||||||||||||||||||||||||
Lapse rate | 0.04% - 46.44% | |||||||||||||||||||||||||||||||
CSA | 3.08% | |||||||||||||||||||||||||||||||
Embedded derivatives | $ | 6.8 | Risk neutral stochastic | Volatility surface | 9.89% - 67.34% | |||||||||||||||||||||||||||
(GMAB / GMWB / COMBO) | valuation methodology | |||||||||||||||||||||||||||||||
Swap curve | 0.21% - 2.76% | |||||||||||||||||||||||||||||||
Mortality rate | 105% 2012 IAM basic table | |||||||||||||||||||||||||||||||
with scale G2 | ||||||||||||||||||||||||||||||||
Lapse rate | 0.00% - 40.00% | |||||||||||||||||||||||||||||||
CSA | 3.08% | |||||||||||||||||||||||||||||||
Level 3 Assets and Liabilities by Pricing Source: | 31-Mar-15 | |||||||||||||||||||||||||||||||
($ in millions) | Internal [1] | External [2] | Total | |||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [3] | $ | 366.4 | $ | — | $ | 366.4 | ||||||||||||||||||||||||||
State and political subdivision | 208 | 197.4 | 405.4 | |||||||||||||||||||||||||||||
Foreign government | — | 32.4 | 32.4 | |||||||||||||||||||||||||||||
Corporate | 3,351.60 | 1,002.50 | 4,354.10 | |||||||||||||||||||||||||||||
CMBS | — | 35.2 | 35.2 | |||||||||||||||||||||||||||||
RMBS | — | 481.6 | 481.6 | |||||||||||||||||||||||||||||
CDO/CLO | — | 205.5 | 205.5 | |||||||||||||||||||||||||||||
Other ABS | 38 | 170.9 | 208.9 | |||||||||||||||||||||||||||||
Total available-for-sale debt securities | 3,964.00 | 2,125.50 | 6,089.50 | |||||||||||||||||||||||||||||
Available-for-sale equity securities | — | 175.5 | 175.5 | |||||||||||||||||||||||||||||
Short-term investments | — | — | — | |||||||||||||||||||||||||||||
Fair value investments | 6.4 | 198.5 | 204.9 | |||||||||||||||||||||||||||||
Total assets | $ | 3,970.40 | $ | 2,499.50 | $ | 6,469.90 | ||||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||
Embedded derivatives | $ | 175.6 | $ | — | $ | 175.6 | ||||||||||||||||||||||||||
Total liabilities | $ | 175.6 | $ | — | $ | 175.6 | ||||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Represents valuations reflecting both internally-derived and market inputs, as well as third-party information or quotes. | |||||||||||||||||||||||||||||||
[2] | Represents unadjusted prices from independent pricing services, third-party financial statements and independent indicative broker quotes where pricing inputs are not readily available. | |||||||||||||||||||||||||||||||
[3] | Includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
Level 3 Assets and Liabilities by Pricing Source: | 31-Dec-14 | |||||||||||||||||||||||||||||||
($ in millions) | Internal [1] | External [2] | Total | |||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [3] | $ | 362.2 | $ | — | $ | 362.2 | ||||||||||||||||||||||||||
State and political subdivision | 159.1 | 241.1 | 400.2 | |||||||||||||||||||||||||||||
Foreign government | — | 53.6 | 53.6 | |||||||||||||||||||||||||||||
Corporate | 3,116.60 | 1,287.30 | 4,403.90 | |||||||||||||||||||||||||||||
CMBS | — | 152.8 | 152.8 | |||||||||||||||||||||||||||||
RMBS | — | 470.3 | 470.3 | |||||||||||||||||||||||||||||
CDO/CLO | — | 196.9 | 196.9 | |||||||||||||||||||||||||||||
Other ABS | 39.3 | 205.8 | 245.1 | |||||||||||||||||||||||||||||
Total available-for-sale debt securities | 3,677.20 | 2,607.80 | 6,285.00 | |||||||||||||||||||||||||||||
Available-for-sale equity securities | — | 179.5 | 179.5 | |||||||||||||||||||||||||||||
Short-term investments | — | — | — | |||||||||||||||||||||||||||||
Fair value investments | 6.3 | 183.7 | 190 | |||||||||||||||||||||||||||||
Total assets | $ | 3,683.50 | $ | 2,971.00 | $ | 6,654.50 | ||||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||
Embedded derivatives | $ | 160.7 | $ | — | $ | 160.7 | ||||||||||||||||||||||||||
Total liabilities | $ | 160.7 | $ | — | $ | 160.7 | ||||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Represents valuations reflecting both internally-derived and market inputs, as well as third-party information or quotes. | |||||||||||||||||||||||||||||||
[2] | Represents unadjusted prices from independent pricing services, third-party financial statements and independent indicative broker quotes where pricing inputs are not readily available. | |||||||||||||||||||||||||||||||
[3] | Includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
Financial instruments not carried at fair value | ||||||||||||||||||||||||||||||||
The Company is required by U.S. GAAP to disclose the fair value of certain financial instruments including those that are not carried at fair value. The following table discloses the Company’s financial instruments where the carrying amounts and fair values differ: | ||||||||||||||||||||||||||||||||
Carrying Amounts and Fair Values | Fair Value | 31-Mar-15 | 31-Dec-14 | |||||||||||||||||||||||||||||
of Financial Instruments: | Hierarchy | |||||||||||||||||||||||||||||||
($ in millions) | Level | Carrying | Fair | Carrying | Fair | |||||||||||||||||||||||||||
Value | Value | Value | Value | |||||||||||||||||||||||||||||
Financial assets: | ||||||||||||||||||||||||||||||||
Policy loans | Level 3 | $ | 2,363.90 | $ | 2,350.70 | $ | 2,352.10 | $ | 2,339.20 | |||||||||||||||||||||||
Cash and cash equivalents | Level 1 | $ | 347.5 | $ | 347.5 | $ | 450 | $ | 450 | |||||||||||||||||||||||
Life settlements | Level 3 | $ | 22.6 | $ | 17.7 | $ | 22.4 | $ | 17.4 | |||||||||||||||||||||||
Financial liabilities: | ||||||||||||||||||||||||||||||||
Investment contracts | Level 3 | $ | 4,084.60 | $ | 4,087.10 | $ | 3,955.00 | $ | 3,957.30 | |||||||||||||||||||||||
7.15 % Surplus notes | Level 3 | $ | 126.2 | $ | 111.5 | $ | 126.2 | $ | 95.8 | |||||||||||||||||||||||
7.45% Senior unsecured bonds | Level 2 | $ | 252.7 | $ | 250.3 | $ | 252.7 | $ | 248 | |||||||||||||||||||||||
Income_Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes |
It is our policy to estimate taxes for interim periods based on estimated annual effective tax rates which are derived, in part, from expected annual pre-tax income. However, the change in the deferred income balances, income tax benefit and expense and related valuation allowance for the three months ended March 31, 2015 have been computed based on the first three months of 2015 as a discrete period. | |
The tax benefit of $2.2 million for the three months ended March 31, 2015 is comprised of a $0.8 million current tax benefit and a $1.4 million deferred tax benefit. The deferred tax benefit results from the application of the intraperiod tax allocation rules that allow for the benefitting of a current year loss in continuing operations when an increase to the valuation allowance is avoided due to the existence of current year income reported elsewhere in the financial statements (e.g., discontinued operations, other comprehensive income). | |
We recorded a deferred tax asset, net of deferred tax liabilities and valuation allowances, of $28.7 million as of March 31, 2015. Consistent with prior periods, we have recorded a full valuation allowance against all categories of net deferred tax assets other than gross unrealized losses on available-for-sale debt securities, due to the significant negative evidence of historical cumulative U.S. GAAP losses and the uncertainty of consistent future U.S. GAAP earnings. | |
We have concluded that a valuation allowance on the deferred tax assets attributable to available-for-sale debt securities with gross unrealized losses was not required due to our ability and intent to hold these securities until recovery of fair value or contractual maturity, thereby avoiding realization of taxable capital losses. This conclusion is also consistent with prior periods. | |
Consistent with the above, for the three months ended March 31, 2015, we recognized a net increase in the valuation allowance of $30.9 million. In accordance with the intraperiod tax allocation rules, the change in the valuation allowance has been allocated to various financial statement components of income or loss. The net deferred tax assets decreased by $5.5 million for the three months ended March 31, 2015, which was attributable to available-for-sale debt securities with gross unrealized losses. | |
The Company and its subsidiaries file consolidated, combined, unitary or separate income tax returns in the U.S. federal, various state and foreign jurisdictions. The Company is no longer subject to U.S. federal income tax examinations by tax authorities for years before 2011. | |
Based upon the timing and status of our current examinations by taxing authorities, we do not believe that it is reasonably possible that any changes to the balance of unrecognized tax benefits occurring within the next 12 months will result in a significant change to the results of operations, financial condition or liquidity. In addition, we do not anticipate that there will be additional payments made or refunds received within the next 12 months with respect to the years under audit. We do not anticipate any increases to the existing unrecognized tax benefits that would have a significant impact on the financial position of the Company. | |
As part of the intercompany tax sharing agreement, the holding company is required to hold funds in escrow for the benefit of Phoenix Life in the event Phoenix Life incurs future taxable losses. In accordance with its regulatory obligation, the Company funded the escrow with $78.9 million of assets including treasury stock, a surplus note issued by PHL Variable and $10.8 million of cash from the holding company in the fourth quarter of 2014. The escrow amount is primarily attributable to cash due to the holding company for losses utilized and benefited in the 2013 tax return. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Income | 3 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Equity [Abstract] | ||||||||||||||||
Accumulated Other Comprehensive Income | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||
Changes in each component of AOCI attributable to the Company for the periods ended March 31, 2015 and 2014 are as follows below (net of tax): | ||||||||||||||||
Accumulated Other Comprehensive Income (Loss) | Net | Net | Net | Total | ||||||||||||
Attributable to The Phoenix Companies, Inc.: | Unrealized | Unrealized | Pension | |||||||||||||
($ in millions) | Gains / (Losses) | Gains / (Losses) | Liability | |||||||||||||
on Investments | on All Other | Adjustments | ||||||||||||||
where | Investments [1] | |||||||||||||||
Credit-related | ||||||||||||||||
OTTI was | ||||||||||||||||
Recognized [1] | ||||||||||||||||
Balance as of December 31, 2013 | $ | 7 | $ | 26.9 | $ | (218.9 | ) | $ | (185.0 | ) | ||||||
Change in component during the period before reclassifications | 6.2 | (9.0 | ) | 0.7 | (2.1 | ) | ||||||||||
Amounts reclassified from AOCI | (3.0 | ) | (3.2 | ) | 1 | (5.2 | ) | |||||||||
Balance as of March 31, 2014 | $ | 10.2 | $ | 14.7 | $ | (217.2 | ) | $ | (192.3 | ) | ||||||
Balance as of December 31, 2014 | $ | 9.9 | $ | 54.8 | $ | (299.1 | ) | $ | (234.4 | ) | ||||||
Change in component during the period before reclassifications | (0.5 | ) | (3.6 | ) | — | (4.1 | ) | |||||||||
Amounts reclassified from AOCI | (1.2 | ) | 1.7 | 1.4 | 1.9 | |||||||||||
Balance as of March 31, 2015 | $ | 8.2 | $ | 52.9 | $ | (297.7 | ) | $ | (236.6 | ) | ||||||
——————— | ||||||||||||||||
[1] | See Note 8 to these consolidated interim unaudited financial statements for additional information regarding offsets to net unrealized investment gains and losses which include policyholder dividend obligation, DAC and other actuarial offsets, and deferred income tax expense (benefit). | |||||||||||||||
Reclassifications from AOCI consist of the following: | ||||||||||||||||
AOCI | Amounts Reclassified | Affected Line Item in the | ||||||||||||||
from AOCI | Consolidated Statements of Income and | |||||||||||||||
Comprehensive Income | ||||||||||||||||
($ in millions) | Three Months Ended | |||||||||||||||
March 31, | ||||||||||||||||
2015 | 2014 | |||||||||||||||
Net unrealized gains / (losses) on investments where | ||||||||||||||||
credit-related OTTI was recognized: | ||||||||||||||||
Available-for-sale securities | $ | 1.9 | $ | 4.6 | Net realized capital gains (losses) | |||||||||||
1.9 | 4.6 | Total before income taxes | ||||||||||||||
0.7 | 1.6 | Income tax expense (benefit) | ||||||||||||||
$ | 1.2 | $ | 3 | Net income (loss) | ||||||||||||
Net unrealized gains / (losses) on | ||||||||||||||||
all other investments: | ||||||||||||||||
Available-for-sale securities | $ | (2.7 | ) | $ | 4.8 | Net realized capital gains (losses) | ||||||||||
(2.7 | ) | 4.8 | Total before income taxes | |||||||||||||
(1.0 | ) | 1.6 | Income tax expense (benefit) | |||||||||||||
$ | (1.7 | ) | $ | 3.2 | Net income (loss) | |||||||||||
Net pension liability adjustments: | ||||||||||||||||
Amortization of actuarial gains (losses) | $ | (2.4 | ) | $ | (1.9 | ) | Other operating expense | |||||||||
Amortization of prior service costs | 0.3 | 0.3 | Other operating expense | |||||||||||||
(2.1 | ) | (1.6 | ) | Total before income taxes | ||||||||||||
(0.7 | ) | (0.6 | ) | Income tax expense (benefit) | ||||||||||||
$ | (1.4 | ) | $ | (1.0 | ) | Net income (loss) | ||||||||||
Total amounts reclassified from AOCI | $ | (1.9 | ) | $ | 5.2 | Net income (loss) | ||||||||||
Employee_Benefit_Plans_and_Emp
Employee Benefit Plans and Employment Agreements | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Compensation and Retirement Disclosure [Abstract] | ||||||||
Employee Benefit Plans and Employment Agreements | Employee Benefit Plans and Employment Agreements | |||||||
Pension and other post-employment benefits | ||||||||
We provide our employees with post-employment benefits that include retirement benefits, through pension and savings plans, and other benefits, including health care and life insurance. The components of pension and post-employment benefit costs follow: | ||||||||
Components of Pension Benefit Costs: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Service cost | $ | 0.8 | $ | 0.6 | ||||
Interest cost | 8.6 | 9.1 | ||||||
Expected return on plan assets | (10.0 | ) | (9.5 | ) | ||||
Net loss amortization | 2.5 | 2 | ||||||
Pension benefit cost | $ | 1.9 | $ | 2.2 | ||||
Components of Other Post-Employment Benefit Costs: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Service cost | $ | — | $ | — | ||||
Interest cost | 0.4 | 0.4 | ||||||
Net gain amortization | (0.1 | ) | (0.1 | ) | ||||
Prior service cost amortization | (0.3 | ) | (0.3 | ) | ||||
Other post-employment benefit cost | $ | — | $ | — | ||||
For the three months ended March 31, 2015, other comprehensive loss included unrealized gains of $0.9 million, net of taxes, relating to the amortization of net prior service costs and net gains/losses. Effective March 31, 2010, all benefit accruals under all of our funded and unfunded defined benefit plans were frozen. | ||||||||
On August 8, 2014, the Highway and Transportation Funding Act of 2014 was enacted into law. The law extended certain pension funding provisions originally included in the Moving Ahead for Progress in the 21st Century Act (MAP-21). The Company took advantage of this in the first quarter of 2015 and does not expect to make any contributions for the remainder of the year. | ||||||||
Savings plans | ||||||||
During the three months ended March 31, 2015 and 2014, we incurred costs of $1.5 million and $1.4 million, respectively, for contributions to our savings plans. | ||||||||
Effective April 1, 2010, employees of the Company (except Saybrus employees) are eligible to receive an annual employer discretionary contribution according to the 401(k) plan terms. |
Earnings_Per_Share
Earnings Per Share | 3 Months Ended | |||||
Mar. 31, 2015 | ||||||
Earnings Per Share [Abstract] | ||||||
Earnings Per Share | Earnings Per Share | |||||
The following table presents a reconciliation of shares used in calculating basic earnings (loss) per common share to those used in calculating diluted earnings (loss) per common share. | ||||||
Shares Used in Calculation of Earnings Per Share: | Three Months Ended | |||||
March 31, | ||||||
(shares in thousands) | 2015 | 2014 | ||||
Weighted-average common shares outstanding | 5,751 | 5,742 | ||||
Weighted-average effect of dilutive potential common shares: | ||||||
Restricted stock units | — | 17 | ||||
Employee stock options | — | 2 | ||||
Potential common shares | — | 19 | ||||
Less: Potential common shares excluded from | 19 | |||||
calculation due to net losses | ||||||
Dilutive potential common shares | — | — | ||||
Weighted-average common shares outstanding, | 5,751 | 5,742 | ||||
including dilutive potential common shares | ||||||
As a result of the net loss from continuing operations for the three months ended March 31, 2015 and 2014, we are required to use basic weighted-average common shares outstanding in the calculation of diluted earnings per share for those periods, since the inclusion of shares of restricted stock units and options would have been anti-dilutive to the earnings per share calculation. |
Segment_Information
Segment Information | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Segment Reporting [Abstract] | ||||||||
Segment Information | Segment Information | |||||||
In managing our business, we analyze segment performance on the basis of operating income. Operating income, as well as components of and financial measures derived from operating income, are non-U.S. GAAP financial measures. | ||||||||
Management believes that these measures provide additional insight into the underlying trends in our operations and are the internal performance measures we use in the management of our operations, including our compensation plans and planning processes. However, our non-U.S. GAAP financial measures should not be considered as substitutes for net income or measures that are derived from or incorporate net income and may be different from similarly titled measures of other companies. Investors should evaluate both U.S. GAAP and non-U.S. GAAP financial measures when reviewing our performance. Operating income is calculated by excluding realized investment gains (losses) as their amount and timing may be subject to management’s investment decisions. | ||||||||
Segment Information on Revenues: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Life and Annuity [1] | $ | 399.8 | $ | 394.2 | ||||
Saybrus Partners [2] | 9 | 7.3 | ||||||
Less: Intercompany revenues [3] | 3.4 | 2.5 | ||||||
Total revenues | $ | 405.4 | $ | 399 | ||||
——————— | ||||||||
[1] | Includes intercompany interest revenue of $0 and $0.1 million for the three months ended March 31, 2015 and 2014, respectively. | |||||||
[2] | Includes intercompany commission revenue of $3.4 million and $2.6 million for the three months ended March 31, 2015 and 2014, respectively. | |||||||
[3] | All intercompany balances are eliminated in consolidating the financial statements. | |||||||
Life and Annuity derives revenue from premiums, fee income and cost of insurance (“COI”) charges and net investment income. Saybrus derives revenue primarily from fees collected for advisory and distribution services. | ||||||||
Results of Operations by Segment as Reconciled to | Three Months Ended | |||||||
Consolidated Net Income (Loss): | March 31, | |||||||
($ in millions) | 2015 | 2014 | ||||||
Life and Annuity operating income (loss) | $ | (59.4 | ) | $ | (5.8 | ) | ||
Saybrus Partners operating income (loss) | 0.8 | 0.3 | ||||||
Less: Applicable income tax expense (benefit) | (2.2 | ) | (4.8 | ) | ||||
Income (loss) from discontinued operations, net of income taxes | (0.5 | ) | (0.6 | ) | ||||
Net realized gains (losses) | (16.1 | ) | (26.9 | ) | ||||
Less: Net income (loss) attributable to noncontrolling interests | 1 | (0.1 | ) | |||||
Net income (loss) | $ | (74.0 | ) | $ | (28.1 | ) | ||
We have not provided asset information for the segments. The assets attributable to Saybrus are not significant relative to the assets of our consolidated balance sheets and are not utilized by the chief operating decision maker. All third-party interest revenue and interest expense of the Company reside within the Life and Annuity segment. |
Discontinued_Operations
Discontinued Operations | 3 Months Ended |
Mar. 31, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations |
PFG Holdings, Inc. | |
On January 4, 2010, we signed a definitive agreement to sell PFG and its subsidiaries, including AGL Life Assurance Company, to Tiptree. Because of the divestiture, these operations are reflected as discontinued operations. On June 23, 2010, we completed the divestiture of PFG and closed the transaction. | |
The definitive agreement contains a provision requiring us to indemnify Tiptree for any losses due to actions resulting from certain specified acts or omissions associated with the divested business prior to closing. There has been litigation filed that falls within this provision of the agreement but does not name the Company as a party to the litigation. We intend to defend these matters vigorously based on our indemnity commitment. | |
There were no assets or liabilities on the consolidated balance sheets identified as discontinued operations related to PFG at March 31, 2015 and December 31, 2014. | |
Net losses for discontinued operations of $0 and $0 were recognized during the three months ended March 31, 2015 and 2014, respectively. | |
Discontinued Reinsurance Operations | |
In 1999, we discontinued our reinsurance operations through a combination of sale, reinsurance and placement of certain retained group accident and health reinsurance business into run-off. We adopted a formal plan to stop writing new contracts covering these risks and to end the existing contracts as soon as those contracts would permit. However, we remain liable for claims under contracts which have not been commuted. | |
We have established reserves for claims and related expenses that we expect to pay on our discontinued group accident and health reinsurance business. These reserves are based on currently known facts and estimates about, among other things, the amount of insured losses and expenses that we believe we will pay, the period over which they will be paid, the amount of reinsurance we believe we will collect from our retrocessionaires and the likely legal and administrative costs of winding down the business. Our total policy liabilities and accruals were $39.3 million and $39.3 million as of March 31, 2015 and December 31, 2014, respectively. Our total amounts recoverable from retrocessionaires related to paid losses were $0.5 million and $0.1 million as of March 31, 2015 and December 31, 2014, respectively. Losses of $0.5 million and $0.6 million were recognized during the three months ended March 31, 2015 and 2014, respectively, primarily due to normal run-off activity. See Note 20 to these consolidated interim unaudited financial statements for additional discussion on remaining liabilities of our discontinued reinsurance operations. |
Contingent_Liabilities
Contingent Liabilities | 3 Months Ended |
Mar. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingent Liabilities | Contingent Liabilities |
Litigation and arbitration | |
The Company is regularly involved in litigation and arbitration, both as a defendant and as a plaintiff. The litigation and arbitration naming the Company as a defendant ordinarily involves our activities as an insurer, employer, investor, investment advisor or taxpayer. | |
It is not feasible to predict or determine the ultimate outcome of all legal or arbitration proceedings or to provide reasonable ranges of potential losses. Management of the Company believes that the ultimate outcome of our litigation and arbitration matters are not likely, either individually or in the aggregate, to have a material adverse effect on the financial condition of the Company beyond the amounts already reported in these financial statements. However, given the large or indeterminate amounts sought in certain of these matters and the inherent unpredictability of litigation and arbitration, it is possible that an adverse outcome in certain matters could, from time to time, have a material adverse effect on the results of operations or cash flows in particular quarterly or annual periods. | |
SEC Cease-and-Desist Order | |
Phoenix and PHL Variable are subject to an SEC Order Instituting Cease-and-Desist Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934, Making Findings, and Imposing a Cease-and-Desist Order which was approved by the SEC in March 2014 (the “March 2014 Order”) and was subsequently amended by an amended SEC administrative order approved by the SEC in August 2014 (the March 2014 Order, as amended, the “Amended Order”). The Amended Order and the March 2014 Order (collectively, the “Orders”), directed Phoenix and PHL Variable to cease and desist from committing or causing any violations and any future violations of Section 13(a) of the Exchange Act and Rules 13a-1 and 13a-13 thereunder and Section 15(d) of the Exchange Act and Rules 15d-1 and 15d-13 thereunder. Phoenix and PHL Variable remain subject to these obligations. Pursuant to the Orders, Phoenix and PHL Variable were required to file certain periodic SEC reports in accordance with the timetables set forth in the Orders. All of such filings have been made. Phoenix and PHL Variable paid civil monetary penalties to the SEC in the aggregate amount of $1.1 million pursuant to the terms of the Orders. | |
Cases Brought by Policy Investors | |
On August 2, 2012, Lima LS PLC filed a complaint against Phoenix, Phoenix Life, PHL Variable, James D. Wehr, Philip K. Polkinghorn, Edward W. Cassidy, Dona D. Young and other unnamed defendants in the United States District Court for the District of Connecticut (Case No. CV12-01122). On July 1, 2013, the defendants’ motion to dismiss the complaint was granted in part and denied in part. Thereafter, on July 31, 2013, the plaintiff served an amended complaint against the same defendants, with the exception that Mr. Cassidy was dropped as a defendant. The plaintiffs allege that Phoenix Life and PHL Variable promoted certain policy sales knowing that the policies would ultimately be owned by investors and then challenging the validity of these policies or denying claims submitted on these policies. Plaintiffs are seeking damages, including punitive and treble damages, attorneys’ fees and a declaratory judgment. We believe we have meritorious defenses against this lawsuit and we intend to vigorously defend against these claims. The outcome of this litigation and any potential losses are uncertain. | |
Cost of Insurance Cases | |
On November 18, 2011, Martin Fleisher and another plaintiff (the “Fleisher Litigation”), on behalf of themselves and others similarly situated, filed suit against Phoenix Life in the United States District Court for the Southern District of New York (C.A. No. 1:11-cv-08405-CM-JCF (U.S. Dist. Ct; S.D.N.Y.)) challenging cost of insurance (“COI”) rate adjustments implemented by Phoenix Life in 2010 and 2011, which Phoenix Life maintains were based on policy language permitting such adjustments. By order dated July 12, 2013, two separate classes were certified in the Fleisher Litigation; by subsequent order dated August 26, 2013, the court decertified one of the classes. The complaint seeks damages for breach of contract. The class certified in the court’s July 12, 2013 order, as limited by the court’s August 26, 2013 order, is limited to holders of Phoenix Life policies issued in New York subject to New York law and subject to Phoenix Life’s 2011 COI rate adjustment. By order dated April 29, 2014, the court denied Martin Fleisher’s motion for summary judgment in the Fleisher Litigation in its entirety, while granting in part and denying in part Phoenix Life’s motion for summary judgment. | |
Phoenix Life’s subsidiary, PHL Variable, has been named as a defendant in six actions challenging its COI rate adjustments implemented concurrently with the Phoenix Life adjustments. Five cases have been brought against PHL Variable, while one case has been brought against PHL Variable and Phoenix Life. These six cases, only one of which is styled as a class action, have been brought by (1) Tiger Capital LLC (C.A. No. 1:12-cv- 02939-CM-JCF; U.S. Dist. Ct; S.D.N.Y., complaint filed on March 14, 2012; the “Tiger Capital Litigation”); (2-5) U.S. Bank National Association, as securities intermediary for Lima Acquisition LP ((2: C.A. No. 1:12-cv-06811-CM-JCF; U.S. Dist. Ct; S.D.N.Y., complaint filed on November 16, 2011; 3: C.A. No. 1:13-cv-01580-CM-JCF; U.S. Dist. Ct; S.D.N.Y., complaint filed on March 8, 2013; collectively, the “U.S. Bank N.Y. Litigations”); (4: C.A. No. 3:14-cv-00555-WWE; U.S. Dist. Ct; D. Conn., complaint originally filed on March 6, 2013, in the District of Delaware and transferred by order dated April 22, 2014, to the District of Connecticut; and 5: C.A. No. 3:14-cv-01398-WWE, U.S. Dist. Ct; D. Conn., complaint filed on September 23, 2014, and amended on October 16, 2014, to add Phoenix Life as a defendant, and consolidated with No. 3:14-cv-00555-WWE (collectively the “U.S. Bank Conn. Litigations”)); and (6) SPRR LLC (C.A. No. 1:14-cv-8714-CM; U.S. Dist. Ct.; S.D.N.Y., complaint filed on October 31, 2014; the “SPRR Litigation”). SPRR LLC filed suit against PHL Variable, on behalf of itself and others similarly situated, challenging COI rate adjustments implemented by PHL Variable in 2011. | |
The Tiger Capital Litigation and the two U.S. Bank N.Y. Litigations were assigned to the same judge as the Fleisher Litigation, and discovery in these four actions has concluded. By orders in both U.S. Bank N.Y. Litigations dated May 23, 2014, the court denied U.S. Bank’s motions for summary judgment in their entirety, while granting in part and denying in part PHL Variable’s motions for summary judgment. U.S. Bank moved for reconsideration of the court’s summary judgment decisions in the U.S. Bank N.Y. Litigations, which the court denied by orders dated June 4, 2014. By order in the Tiger Capital Litigation dated July 23, 2014, the court denied Tiger Capital’s motion for summary judgment in its entirety, while granting in part and denying in part PHL Variable’s motion for summary judgment. Plaintiff in the Tiger Capital Litigation seeks damages for breach of contract. Plaintiff in the U.S. Bank N.Y. Litigations and the U.S. Bank Conn. Litigations seeks damages and attorneys’ fees for breach of contract and other common law and statutory claims. The plaintiff in the SPRR Litigation, which has been reassigned to the same judge as the Fleisher Litigation, Tiger Capital Litigation and the two U.S. Bank N.Y. Litigations, seeks damages for breach of contract for a nationwide class of policyholders. | |
The Fleisher Litigation is scheduled for trial commencing June 15, 2015, the U.S. Bank N.Y. Litigations are scheduled for trial commencing June 29, 2015, and the Tiger Capital Litigation is scheduled for trial commencing July 13, 2015. | |
Phoenix Life and PHL Variable (together, the “Life Companies”) reached an agreement as of April 30, 2015 with SPRR, LLC, Martin Fleisher, as trustee of the Michael Moss Irrevocable Life Insurance Trust II, and Jonathan Berck, as trustee of the John L. Loeb, Jr. Insurance Trust (collectively, the “Plaintiffs”), to resolve the Fleisher Litigation and SPRR Litigation, both class actions. The proposed settlement class consists of all policyholders that were subject to the 2010 or 2011 COI rate adjustments (collectively, the “Settlement Class”), including the policies within the above-named COI cases, and will be structured to allow members of the Settlement Class to opt out of the settlement (the “Settlement”). The Life Companies will establish a Settlement fund, which may be reduced proportionally for any opt-outs, and will pay a class counsel fee if the Settlement is approved. The Life Companies will be released by all participating members of the Settlement Class, and the COI rate adjustment for policies participating in the Settlement Class will remain in effect. The Life Companies agreed to pay a total of $48.5 million, as reduced for any opt-outs, in connection with the Settlement. The Life Companies agreed not to impose additional increases to COI rates on policies participating in the Settlement Class through the end of 2020, and not to challenge the validity of policies participating in the Settlement Class for lack of insurable interest or misrepresentations in the policy applications. The Settlement is intended to resolve all pending COI cases, other than for policyholders who opt-out of the Settlement. The agreement requires that a formal settlement agreement will be filed with the United States District Court for the Southern District of New York and will be subject to certain conditions and court approval. In connection with the Settlement, the Company incurred a charge of $48.5 million in the first quarter of 2015. Under the settlement, policyholders who are class members, including those which have filed individual actions relating to COI rate adjustments, may opt out of the settlement and separately litigate their claims. The Companies are currently unable to estimate the extent to which policyholders may opt out of the settlement or the damages which they may or may not collect in litigation against the Companies. There can be no assurance that the ultimate cost will be $48.5 million. Depending on the results of any opt outs and the resultant litigation and/or negotiation the ultimate cost could be more or less than $48.5 million. | |
Complaints to state insurance departments regarding PHL Variable’s COI rate adjustments have also prompted regulatory inquiries or investigations in several states, with two of such states (California and Wisconsin) issuing letters directing PHL Variable to take remedial action in response to complaints by a single policyholder. PHL Variable disagrees with both states’ positions. On March 23, 2015, an Administrative Law Judge (“ALJ”) in Wisconsin ordered PHL Variable to pay restitution to current and former owners of seven policies and imposed a fine on PHL Variable which, in a total amount, does not have a material impact on PHL Variable’s financial position (Office of the Commissioner of Insurance Case No. 13- C35362). PHL Variable disagrees with the ALJ’s determination and has appealed the order. | |
For any cases or regulatory directives not resolved by the Settlement, Phoenix Life and PHL Variable believe that they have meritorious defenses against all of these lawsuits and regulatory directives and intend to vigorously defend against them, including by appeal if necessary. For any matters not resolved by the Settlement, the outcome is uncertain and any potential losses cannot be reasonably estimated. | |
Regulatory matters | |
State regulatory bodies, the SEC, the Financial Industry Regulatory Authority (“FINRA”), the IRS and other regulatory bodies regularly make inquiries of us and, from time to time, conduct examinations or investigations concerning our compliance with laws and regulations related to, among other things, our insurance and broker-dealer subsidiaries, securities offerings and registered products. We endeavor to respond to such inquiries in an appropriate way and to take corrective action if warranted. Further, the Company is providing to the SEC certain information and documentation regarding the restatements of its prior period financial statements and the staff of the SEC has indicated to the Company that the matter remains subject to further investigation and potential further regulatory action. We cannot predict the outcome of any of such investigations or actions related to these or other matters. | |
Regulatory actions may be difficult to assess or quantify. The nature and magnitude of their outcomes may remain unknown for substantial periods of time. It is not feasible to predict or determine the ultimate outcome of all pending inquiries, investigations, legal proceedings and other regulatory actions, or to provide reasonable ranges of potential losses. Based on current information, we believe that the outcomes of our regulatory matters are not likely, either individually or in the aggregate, to have a material adverse effect on our consolidated financial condition. However, given the inherent unpredictability of regulatory matters, it is possible that an adverse outcome in certain matters could, from time to time, have a material adverse effect on our consolidated financial statements in particular quarterly or annual periods. | |
Discontinued Reinsurance Operations | |
In 1999, Phoenix Life discontinued reinsurance operations through a combination of sale, reinsurance and placement of certain retained group accident and health reinsurance business into run-off. A formal plan was adopted to stop writing new contracts covering these risks and to end existing contracts as soon as those contracts would permit. However, Phoenix Life remains subject to claims under contracts that have not been commuted. Certain discontinued group accident and health reinsurance business was the subject of disputes concerning the placement of the business with reinsurers and the recovery of reinsurance. These disputes have been substantially resolved or settled. | |
We have established reserves for claims and related expenses that we expect to pay on our discontinued group accident and health reinsurance business. These reserves are based on currently known facts and estimates about, among other things, the amount of insured losses and expenses that we believe we will pay, the period over which they will be paid, the amount of reinsurance we believe we will collect from our retrocessionaires and the likely legal and administrative costs of winding down the business. | |
Phoenix Life expects reserves and reinsurance to cover the run-off of the business; however, unfavorable or favorable claims and/or reinsurance recovery experience are reasonably possible and could result in our recognition of additional losses or gains in future years. Management believes, based on current information and after consideration of the provisions made in these consolidated interim unaudited financial statements, that any future adverse or favorable development of recorded reserves and/or reinsurance recoverables will not have a material adverse effect on its financial position. Nevertheless, it is possible that future developments could have a material adverse effect on our results of operations. | |
See Note 19 to these consolidated interim unaudited financial statements for additional information regarding discontinued operations. |
Other_Commitments
Other Commitments | 3 Months Ended |
Mar. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Other Commitments | Other Commitments |
We have an agreement with HP Enterprise Services related to the management of our infrastructure services which expires in 2015. The remaining commitments total $10.4 million through 2015. | |
As part of its normal investment activities, the Company enters into agreements to fund limited partnerships that make debt and equity investments. As of March 31, 2015, the Company had unfunded commitments of $230.7 million under such agreements, of which $52.3 million is expected to be funded by December 31, 2015. See Note 8 to these consolidated interim unaudited financial statements for additional information on VIEs. | |
On January 5, 2015, the Company committed to purchase $100.0 million in investment grade rated infrastructure bonds through an outside investment advisor. These purchases are expected to be made over 24 months and no more than $50.0 million of the committed amount may be called in the first 12 month period. The arrangement may be terminated prior to funding the committed amount at the discretion of the Company subject to certain standard provisions for notice and immaterial fees. The debt will be held as available-for-sale debt securities on the consolidated balance sheets. As of March 31, 2015, $8.0 million has been funded. | |
In addition, the Company enters into agreements to purchase private placement investments. At March 31, 2015, the Company had open commitments of $103.7 million under such agreements which are expected to be funded by March 31, 2016. |
Subsequent_Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events |
On May 4, 2015, we announced that Mr. Augustus K. Oliver, II withdrew his name as a nominee for election as a director at the 2015 Annual Meeting of Shareholders and that he will continue to serve as a director until the 2015 Annual Meeting to be held on May 14, 2015. |
Basis_of_Presentation_and_Sign1
Basis of Presentation and Significant Accounting Policies (Policies) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Accounting Policies [Abstract] | |||||
Basis of presentation | We have prepared these consolidated interim unaudited financial statements in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”), which differs materially from the accounting practices prescribed by various insurance regulatory authorities. Our consolidated interim unaudited financial statements include the accounts of the Company and its subsidiaries. Intercompany balances and transactions have been eliminated in consolidating these consolidated interim unaudited financial statements. | ||||
Reclassification | Certain prior year amounts have been reclassified to conform to the current year presentation. These consolidated interim unaudited financial statements include all adjustments (consisting primarily of accruals) considered necessary for the fair statement of the consolidated balance sheets, consolidated statements of income and comprehensive income, consolidated statements of cash flows and consolidated statements of changes in stockholders’ equity for the interim periods. Certain financial information that is not required for interim reporting has been omitted. Financial results for the three months ended March 31, 2015 are not necessarily indicative of full year results. For the three months ended March 31, 2015, there were no out-of-period adjustments. These consolidated interim unaudited financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2014 contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 (the “2014 Form 10-K”). | ||||
Use of Estimates | Use of estimates | ||||
In preparing these consolidated interim unaudited financial statements in conformity with U.S. GAAP, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated interim unaudited financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions are made in the determination of estimated gross profits (“EGPs”) and estimated gross margins (“EGMs”) used in the valuation and amortization of assets and liabilities associated with universal life and annuity contracts; policyholder liabilities and accruals; valuation of investments in debt and equity securities; limited partnerships and other investments; valuation of deferred tax assets; pension and other post-employment benefits liabilities; and accruals for contingent liabilities. Certain of these estimates are particularly sensitive to market conditions and/or volatility in the debt or equity markets could have a material impact on the consolidated interim unaudited financial statements. Actual results could differ from these estimates. | |||||
Adoption of new accounting standards and Accounting standards not yet adopted | Adoption of new accounting standards | ||||
Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity | |||||
In April 2014, the Financial Accounting Standards Board (the “FASB”) issued updated guidance that changes the criteria for reporting discontinued operations and introduces new financial statement disclosures. The new guidance is effective prospectively to new disposals and new classifications of disposal groups as held for sale that occur within annual periods beginning on or after December 15, 2014 and interim periods within those annual periods. This new guidance did not have any impact on the Company’s consolidated financial position, results of operations and financial statement disclosures. | |||||
Accounting for Troubled Debt Restructurings by Creditors | |||||
In January 2014, the FASB issued updated guidance for troubled debt restructurings clarifying when an in substance repossession or foreclosure occurs, and when a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan. The new guidance is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2014.This new guidance did not have a material impact on the Company’s consolidated financial position, results of operations and financial statement disclosures. | |||||
Accounting for Investments in Qualified Affordable Housing Projects | |||||
In January 2014, the FASB issued updated guidance regarding investments in flow-through limited liability entities that manage or invest in affordable housing projects that qualify for the low-income housing tax credit. Under the guidance, an entity is permitted to make an accounting policy election to amortize the initial cost of its investment in proportion to the tax credits and other tax benefits received and recognize the net investment performance in the statement of operations as a component of income tax expense (benefit) if certain conditions are met. The new guidance is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. This new guidance did not have a material impact on the Company’s consolidated financial position, results of operations and financial statement disclosures. | |||||
Accounting standards not yet adopted | |||||
For information regarding additional accounting standards that the Company has not yet adopted, see the “Accounting Standards Not Yet Adopted” section of Note 3 of Notes to the Consolidated Financial Statements in the Company’s 2014 Form 10-K. There have been no changes other than as noted below. | |||||
Interest - Imputation of Interest (Simplifying the Presentation of Debt Issuance Costs) | |||||
In April 2015, the FASB issued guidance that changes the presentation of debt issuance costs in financial statements. Under the new guidance, a company would present debt issuance costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. The recognition and measurement of debt issuance costs is not affected by the new guidance. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015, and should be applied retrospectively to all periods presented. Early adoption is allowed for all entities for financial statements that have not been previously issued. This guidance will not have any effect on the Company’s consolidated financial position or results of operations. | |||||
Significant accounting policies | |||||
Our significant accounting policies are presented in the notes to our consolidated financial statements for the year ended December 31, 2014 contained in the 2014 Form 10-K except for the following update to our expected future interest rate assumption as noted more fully below. | |||||
Deferred Policy Acquisition Costs | |||||
In the current quarter, the Company unlocked its assumption for expected future interest rates. This best estimate assumption reflects current yields and expected maturities of our fixed income portfolio combined with expected reinvestment rates. The interest rates begin with prevailing rates but are assumed to revert back to the long-term yield over the mean reversion period. The unlock impacted DAC, certain additional policyholder liabilities for guaranteed benefits on variable annuity and universal life contracts and the universal life PFBL. The result was a net expense of approximately $0.2 million for the quarter ended March 31, 2015. | |||||
The following table summarizes the current interest rate assumption as updated in the current period unlock: | |||||
Significant Assumption | Product | Explanation and Derivation | |||
Interest rates and default rates | Fixed and Indexed Annuities | Investment returns are based on the current yields and maturities of our fixed income portfolio combined with expected reinvestment rates from current market rates. Reinvestment rates are assumed to revert to long-term rates and long-term default rates over the mean reversion period. Contractually permitted future changes in credited rates are assumed to help support investment margins. | |||
Universal Life | |||||
Participating Life | |||||
Deferred policy acquisition costs | In the current quarter, the Company unlocked its assumption for expected future interest rates. This best estimate assumption reflects current yields and expected maturities of our fixed income portfolio combined with expected reinvestment rates. The interest rates begin with prevailing rates but are assumed to revert back to the long-term yield over the mean reversion period. The unlock impacted DAC, certain additional policyholder liabilities for guaranteed benefits on variable annuity and universal life contracts and the universal life PFBL |
Revision_of_Previously_Reporte1
Revision of Previously Reported Financial Statements (Tables) | 3 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Accounting Changes and Error Corrections [Abstract] | ||||||||||||||||
Schedule of Revision of Previously Reported Financial Information | The impact of the correction of these errors on the consolidated financial statements for the three months ended March 31, 2014 is presented in the following tables within this Note below. | |||||||||||||||
($ in millions, except share data) | Consolidated Statement of Income and Comprehensive Income | |||||||||||||||
For the three months ended March 31, 2014 | ||||||||||||||||
Correction of errors | ||||||||||||||||
As | UL | Other | As | |||||||||||||
reported | unlock | adjustments | revised | |||||||||||||
REVENUES: | ||||||||||||||||
Premiums | $ | 79.6 | $ | — | $ | — | $ | 79.6 | ||||||||
Fee income | 134.8 | — | — | 134.8 | ||||||||||||
Net investment income | 213.5 | — | (2.0 | ) | 211.5 | |||||||||||
Net realized gains (losses): | ||||||||||||||||
Total other-than-temporary impairment (“OTTI”) losses | — | — | — | — | ||||||||||||
Portion of OTTI losses recognized in other comprehensive income (“OCI”) | (0.2 | ) | — | — | (0.2 | ) | ||||||||||
Net OTTI losses recognized in earnings | (0.2 | ) | — | — | (0.2 | ) | ||||||||||
Net realized gains (losses), excluding OTTI losses | (25.5 | ) | — | (1.2 | ) | (26.7 | ) | |||||||||
Net realized gains (losses) | (25.7 | ) | — | (1.2 | ) | (26.9 | ) | |||||||||
Total revenues | 402.2 | — | (3.2 | ) | 399 | |||||||||||
BENEFITS AND EXPENSES: | ||||||||||||||||
Policy benefits | 236 | (0.7 | ) | (5.0 | ) | 230.3 | ||||||||||
Policyholder dividends | 73.8 | — | (1.6 | ) | 72.2 | |||||||||||
Policy acquisition cost amortization | 22.4 | — | 2.2 | 24.6 | ||||||||||||
Interest expense on indebtedness | 7.1 | — | — | 7.1 | ||||||||||||
Other operating expenses | 97.9 | — | (0.7 | ) | 97.2 | |||||||||||
Total benefits and expenses | 437.2 | (0.7 | ) | (5.1 | ) | 431.4 | ||||||||||
Income (loss) from continuing operations before income taxes | (35.0 | ) | 0.7 | 1.9 | (32.4 | ) | ||||||||||
Income tax expense (benefit) | (3.6 | ) | — | (1.2 | ) | (4.8 | ) | |||||||||
Income (loss) from continuing operations | (31.4 | ) | 0.7 | 3.1 | (27.6 | ) | ||||||||||
Income (loss) from discontinued operations, net of income taxes | (0.9 | ) | — | 0.3 | (0.6 | ) | ||||||||||
Net income (loss) | (32.3 | ) | 0.7 | 3.4 | (28.2 | ) | ||||||||||
Less: Net income (loss) attributable to noncontrolling interests | 1 | — | (1.1 | ) | (0.1 | ) | ||||||||||
Net income (loss) attributable to The Phoenix Companies, Inc. | $ | (33.3 | ) | $ | 0.7 | $ | 4.5 | $ | (28.1 | ) | ||||||
(Continued on next page) | ||||||||||||||||
(Continued from previous page) | Consolidated Statements of Income and Comprehensive Income | |||||||||||||||
($ in millions, except share data) | For the three months ended March 31, 2014 | |||||||||||||||
Correction of errors | ||||||||||||||||
As | UL | Other | As | |||||||||||||
reported | unlock | adjustments | revised | |||||||||||||
COMPREHENSIVE INCOME (LOSS): | ||||||||||||||||
Net income (loss) attributable to The Phoenix Companies, Inc. | $ | (33.3 | ) | $ | 0.7 | $ | 4.5 | $ | (28.1 | ) | ||||||
Net income (loss) attributable to noncontrolling interests | 1 | — | (1.1 | ) | (0.1 | ) | ||||||||||
Net income (loss) | (32.3 | ) | 0.7 | 3.4 | (28.2 | ) | ||||||||||
Other comprehensive income (loss) before income taxes: | ||||||||||||||||
Unrealized investment gains (losses), net of related offsets | 16.9 | 0.8 | 6 | 23.7 | ||||||||||||
Net pension liability adjustment | 1.6 | — | 0.1 | 1.7 | ||||||||||||
Other comprehensive income (loss) before income taxes | 18.5 | 0.8 | 6.1 | 25.4 | ||||||||||||
Less: Income tax expense (benefit) related to: | ||||||||||||||||
Unrealized investment gains (losses), net of related offsets | 28.7 | — | 4 | 32.7 | ||||||||||||
Net pension liability adjustment | — | — | — | — | ||||||||||||
Total income tax expense (benefit) | 28.7 | — | 4 | 32.7 | ||||||||||||
Other comprehensive income (loss), net of income taxes | (10.2 | ) | 0.8 | 2.1 | (7.3 | ) | ||||||||||
Comprehensive income (loss) | (42.5 | ) | 1.5 | 5.5 | (35.5 | ) | ||||||||||
Less: Comprehensive income (loss) attributable to noncontrolling interests | 1 | — | (1.1 | ) | (0.1 | ) | ||||||||||
Comprehensive income (loss) attributable to The Phoenix Companies, Inc. | $ | (43.5 | ) | $ | 1.5 | $ | 6.6 | $ | (35.4 | ) | ||||||
EARNINGS (LOSS) PER SHARE: | ||||||||||||||||
Income (loss) from continuing operations – basic | $ | (5.47 | ) | $ | 0.12 | $ | 0.73 | $ | (4.79 | ) | ||||||
Income (loss) from continuing operations – diluted | $ | (5.47 | ) | $ | 0.12 | $ | 0.73 | $ | (4.79 | ) | ||||||
Income (loss) from discontinued operations – basic | $ | (0.16 | ) | $ | — | $ | 0.05 | $ | (0.10 | ) | ||||||
Income (loss) from discontinued operations – diluted | $ | (0.16 | ) | $ | — | $ | 0.05 | $ | (0.10 | ) | ||||||
Net income (loss) attributable to The Phoenix Companies, Inc.– basic | $ | (5.80 | ) | $ | 0.12 | $ | 0.78 | $ | (4.89 | ) | ||||||
Net income (loss) attributable to The Phoenix Companies, Inc. – diluted | $ | (5.80 | ) | $ | 0.12 | $ | 0.78 | $ | (4.89 | ) | ||||||
Basic weighted-average common shares outstanding (in thousands) | 5,742 | 5,742 | ||||||||||||||
Diluted weighted-average common shares outstanding (in thousands) | 5,742 | 5,742 | ||||||||||||||
($ in millions) | Consolidated Statement of Cash Flows | |||||||||||||||
For the period ended March 31, 2014 | ||||||||||||||||
As | Correction | As | ||||||||||||||
reported | of errors | revised | ||||||||||||||
OPERATING ACTIVITIES: | ||||||||||||||||
Net income (loss) | $ | (33.3 | ) | $ | 5.2 | $ | (28.1 | ) | ||||||||
Net realized gains / losses | 25.7 | 1.2 | 26.9 | |||||||||||||
Policy acquisition costs deferred | (14.4 | ) | (0.2 | ) | (14.6 | ) | ||||||||||
Policy acquisition cost amortization | 22.4 | 2.2 | 24.6 | |||||||||||||
Amortization and depreciation | 1.5 | — | 1.5 | |||||||||||||
Interest credited | 35.6 | — | 35.6 | |||||||||||||
Equity in earnings of limited partnerships and other investments | (23.8 | ) | 3.7 | (20.1 | ) | |||||||||||
Change in: | ||||||||||||||||
Accrued investment income | (43.3 | ) | (0.7 | ) | (44.0 | ) | ||||||||||
Deferred income taxes, net | (6.1 | ) | (2.2 | ) | (8.3 | ) | ||||||||||
Reinsurance recoverable | (12.2 | ) | (0.7 | ) | (12.9 | ) | ||||||||||
Policy liabilities and accruals | (137.6 | ) | (5.0 | ) | (142.6 | ) | ||||||||||
Dividend obligations | 31.8 | (1.6 | ) | 30.2 | ||||||||||||
Pension and post-employment liabilities | (4.9 | ) | — | (4.9 | ) | |||||||||||
Impact of operating activities of consolidated investment entities, net | (5.6 | ) | (1.1 | ) | (6.7 | ) | ||||||||||
Other operating activities, net | 23.9 | (0.8 | ) | 23.1 | ||||||||||||
Cash provided by (used for) operating activities | (140.3 | ) | — | (140.3 | ) | |||||||||||
INVESTING ACTIVITIES: | ||||||||||||||||
Purchases of: | ||||||||||||||||
Available-for-sale debt securities | (338.5 | ) | 0.1 | (338.4 | ) | |||||||||||
Available-for-sale equity securities | (1.7 | ) | (0.1 | ) | (1.8 | ) | ||||||||||
Short-term investments | (649.3 | ) | — | (649.3 | ) | |||||||||||
Derivative instruments | (17.8 | ) | — | (17.8 | ) | |||||||||||
Fair value and other investments | (0.3 | ) | — | (0.3 | ) | |||||||||||
Sales, repayments and maturities of: | ||||||||||||||||
Available-for-sale debt securities | 338.8 | (0.1 | ) | 338.7 | ||||||||||||
Available-for-sale equity securities | 3 | 0.1 | 3.1 | |||||||||||||
Short-term investments | 489.8 | — | 489.8 | |||||||||||||
Derivative instruments | 42.1 | — | 42.1 | |||||||||||||
Fair value and other investments | 2.8 | — | 2.8 | |||||||||||||
Contributions to limited partnerships and limited liability corporations | (18.2 | ) | — | (18.2 | ) | |||||||||||
Distributions from limited partnerships and limited liability corporations | 30.3 | — | 30.3 | |||||||||||||
Policy loans, net | 32 | — | 32 | |||||||||||||
Impact of investing activities of consolidated investment entities, net | — | — | — | |||||||||||||
Other investing activities, net | (2.0 | ) | — | (2.0 | ) | |||||||||||
Cash provided by (used for) investing activities | (89.0 | ) | — | (89.0 | ) | |||||||||||
(Continued on next page) | ||||||||||||||||
(Continued from previous page) | Consolidated Statement of Cash Flows | |||||||||||||||
($ in millions, except share data) | For the period ended March 31, 2014 | |||||||||||||||
As | Correction | As | ||||||||||||||
reported | of errors | revised | ||||||||||||||
FINANCING ACTIVITIES: | ||||||||||||||||
Policyholder deposits | 361.3 | — | 361.3 | |||||||||||||
Policyholder withdrawals | (321.5 | ) | — | (321.5 | ) | |||||||||||
Net transfers (to) from separate accounts | 118.2 | — | 118.2 | |||||||||||||
Impact of financing activities of consolidated investment entities, net | 0.1 | — | 0.1 | |||||||||||||
Other financing activities, net | — | — | — | |||||||||||||
Cash provided by (used for) financing activities | 158.1 | — | 158.1 | |||||||||||||
Change in cash and cash equivalents | (71.2 | ) | — | (71.2 | ) | |||||||||||
Change in cash included in discontinued operations assets | (0.7 | ) | — | (0.7 | ) | |||||||||||
Cash and cash equivalents, beginning of period | 496.4 | — | 496.4 | |||||||||||||
Cash and cash equivalents, end of period | $ | 424.5 | $ | — | $ | 424.5 | ||||||||||
Supplemental Disclosure of Cash Flow Information | ||||||||||||||||
Income taxes (paid) refunded | $ | — | $ | — | $ | — | ||||||||||
Interest expense on indebtedness paid | $ | (4.7 | ) | $ | — | $ | (4.7 | ) | ||||||||
Non-Cash Transactions During the Period | ||||||||||||||||
Investment exchanges | $ | 13 | $ | — | $ | 13 | ||||||||||
($ in millions) | Consolidated Statement of | |||||||||||||||
Changes in Stockholders' Equity | ||||||||||||||||
For the period ended March 31, 2014 | ||||||||||||||||
As | Correction | As | ||||||||||||||
reported | of errors | revised | ||||||||||||||
COMMON STOCK: | ||||||||||||||||
Balance, beginning of period | $ | 0.1 | $ | — | $ | 0.1 | ||||||||||
Balance, end of period | $ | 0.1 | $ | — | $ | 0.1 | ||||||||||
ADDITIONAL PAID-IN CAPITAL: | ||||||||||||||||
Balance, beginning of period | $ | 2,633.10 | $ | — | $ | 2,633.10 | ||||||||||
Issuance of shares and compensation expense on stock compensation awards | — | — | — | |||||||||||||
Balance, end of period | $ | 2,633.10 | $ | — | $ | 2,633.10 | ||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | ||||||||||||||||
Balance, beginning of period | $ | (185.2 | ) | $ | 0.2 | $ | (185.0 | ) | ||||||||
Other comprehensive income (loss) | (10.2 | ) | 2.9 | (7.3 | ) | |||||||||||
Balance, end of period | $ | (195.4 | ) | $ | 3.1 | $ | (192.3 | ) | ||||||||
ACCUMULATED DEFICIT: | ||||||||||||||||
Balance, beginning of period | $ | (1,692.1 | ) | $ | 16.3 | $ | (1,675.8 | ) | ||||||||
Net income (loss) | (33.3 | ) | 5.2 | (28.1 | ) | |||||||||||
Balance, end of period | $ | (1,725.4 | ) | $ | 21.5 | $ | (1,703.9 | ) | ||||||||
TREASURY STOCK, AT COST: | ||||||||||||||||
Balance, beginning of period | $ | (182.9 | ) | $ | — | $ | (182.9 | ) | ||||||||
Balance, end of period | $ | (182.9 | ) | $ | — | $ | (182.9 | ) | ||||||||
TOTAL STOCKHOLDERS’ EQUITY ATTRIBUTABLE TO | ||||||||||||||||
THE PHOENIX COMPANIES, INC.: | ||||||||||||||||
Balance, beginning of period | $ | 573 | $ | 16.5 | $ | 589.5 | ||||||||||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | (43.5 | ) | 8.1 | (35.4 | ) | |||||||||||
Balance, end of period | $ | 529.5 | $ | 24.6 | $ | 554.1 | ||||||||||
NONCONTROLLING INTERESTS: | ||||||||||||||||
Balance, beginning of period | $ | 10.7 | $ | 1.1 | $ | 11.8 | ||||||||||
Net income (loss) attributable to noncontrolling interests [1] | 1 | (1.1 | ) | (0.1 | ) | |||||||||||
Change in equity of noncontrolling interests [1] | 0.1 | — | 0.1 | |||||||||||||
Balance, end of period | $ | 11.8 | $ | — | $ | 11.8 | ||||||||||
TOTAL STOCKHOLDERS’ EQUITY: | ||||||||||||||||
Balance, beginning of period | $ | 583.7 | $ | 17.6 | $ | 601.3 | ||||||||||
Change in stockholders’ equity | (42.4 | ) | 7 | (35.4 | ) | |||||||||||
Balance, end of period | $ | 541.3 | $ | 24.6 | $ | 565.9 | ||||||||||
——————— | ||||||||||||||||
[1] | Reported net as change in noncontrolling interests in Note 26 to our consolidated financial statements in the 2014 Form 10-K. |
Reinsurance_Tables
Reinsurance (Tables) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Insurance [Abstract] | ||||||||
Reinsurance activity | Other reinsurance activity is shown below. | |||||||
Direct Business and Reinsurance in Continuing Operations: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Direct premiums | $ | 111 | $ | 115.8 | ||||
Premiums assumed | 1.8 | 1.8 | ||||||
Premiums ceded [1] | (34.4 | ) | (38.0 | ) | ||||
Premiums | $ | 78.4 | $ | 79.6 | ||||
Percentage of amount assumed to net premiums | 2.30% | 2.30% | ||||||
Direct policy benefits incurred | $ | 327.3 | $ | 178.5 | ||||
Policy benefits assumed | 1.6 | 12.6 | ||||||
Policy benefits ceded | (88.5 | ) | (68.7 | ) | ||||
Premiums paid [2] | 22.6 | 22.3 | ||||||
Policy benefits [3] | $ | 263 | $ | 144.7 | ||||
——————— | ||||||||
[1] | Primarily represents premiums ceded to reinsurers related to traditional whole life and term insurance policies. | |||||||
[2] | For universal life and variable universal life contracts, premiums paid to reinsurers are reflected within policy benefits. See Note 3 to these consolidated interim unaudited financial statements for additional information regarding significant accounting policies. | |||||||
[3] | Policy benefit amounts above exclude changes in reserves, interest credited to policyholders and other items, which total $29.0 million and $85.6 million, net of reinsurance, for the three months ended March 31, 2015 and 2014, respectively. |
Demutualization_and_Closed_Blo1
Demutualization and Closed Block (Tables) | 3 Months Ended | |||||||||||
Mar. 31, 2015 | ||||||||||||
Insurance [Abstract] | ||||||||||||
Closed Block Assets And Liabilities | ||||||||||||
Closed Block Assets and Liabilities as of: | March 31, | 31-Dec-14 | Inception | |||||||||
($ in millions) | 2015 | |||||||||||
Available-for-sale debt securities | $ | 5,886.10 | $ | 5,877.00 | $ | 4,773.10 | ||||||
Available-for-sale equity securities | 89 | 91.7 | — | |||||||||
Short-term investments | 9.9 | — | — | |||||||||
Limited partnerships and other investments | 347.1 | 343.4 | 399 | |||||||||
Policy loans | 1,149.70 | 1,159.10 | 1,380.00 | |||||||||
Fair value investments | 65.3 | 59.8 | — | |||||||||
Total closed block investments | 7,547.10 | 7,531.00 | 6,552.10 | |||||||||
Cash and cash equivalents | 99 | 89.6 | — | |||||||||
Accrued investment income | 80.7 | 80.7 | 106.8 | |||||||||
Reinsurance recoverable | 36.6 | 19.1 | — | |||||||||
Deferred income taxes, net | 289 | 290.3 | 389.4 | |||||||||
Other closed block assets | 65.4 | 67.4 | 41.4 | |||||||||
Total closed block assets | 8,117.80 | 8,078.10 | 7,089.70 | |||||||||
Policy liabilities and accruals | 8,018.00 | 8,058.20 | 8,301.70 | |||||||||
Policyholder dividends payable | 201 | 201.9 | 325.1 | |||||||||
Policy dividend obligation | 776 | 714.8 | — | |||||||||
Other closed block liabilities | 60.6 | 48 | 12.3 | |||||||||
Total closed block liabilities | 9,055.60 | 9,022.90 | 8,639.10 | |||||||||
Excess of closed block liabilities over closed block assets [1] | 937.8 | 944.8 | $ | 1,549.40 | ||||||||
Less: Excess of closed block assets over closed block liabilities | (12.8 | ) | (11.8 | ) | ||||||||
attributable to noncontrolling interests | ||||||||||||
Excess of closed block liabilities over closed block assets attributable to | $ | 950.6 | $ | 956.6 | ||||||||
The Phoenix Companies, Inc. | ||||||||||||
——————— | ||||||||||||
[1] | The maximum future earnings summary to inure to the benefit of the stockholders is represented by the excess of closed block liabilities over closed block assets. All unrealized investment gains (losses), net of income tax, have been allocated to the policyholder dividend obligation. | |||||||||||
Closed Block Revenues and Expenses | ||||||||||||
Closed Block Revenues and Expenses and Changes in | Three Months Ended | |||||||||||
Policyholder Dividend Obligations: | March 31, | |||||||||||
($ in millions) | 2015 | 2014 | ||||||||||
Closed block revenues | ||||||||||||
Premiums | $ | 70.2 | $ | 72.8 | ||||||||
Net investment income | 100.2 | 107.3 | ||||||||||
Net realized gains (losses) | (4.6 | ) | 5.3 | |||||||||
Total revenues | 165.8 | 185.4 | ||||||||||
Policy benefits | 115.5 | 103.8 | ||||||||||
Other operating expenses | 0.1 | 0.2 | ||||||||||
Total benefits and expenses | 115.6 | 104 | ||||||||||
Closed block contribution to income before dividends | 50.2 | 81.4 | ||||||||||
and income taxes | ||||||||||||
Policyholder dividends | (40.1 | ) | (72.2 | ) | ||||||||
Closed block contribution to income before income taxes | 10.1 | 9.2 | ||||||||||
Applicable income tax expense | 3.5 | 3.2 | ||||||||||
Closed block contribution to income | 6.6 | 6 | ||||||||||
Less: Closed block contribution to income attributable to | 0.5 | (0.1 | ) | |||||||||
noncontrolling interests | ||||||||||||
Closed block contribution to income attributable to | $ | 6.1 | $ | 6.1 | ||||||||
The Phoenix Companies, Inc. | ||||||||||||
Closed Block Policyholder Dividend Obligation | ||||||||||||
Closed Block Policyholder Dividend Obligation as of: | March 31, | 31-Dec-14 | ||||||||||
($ in millions) | 2015 | |||||||||||
Policyholder dividend obligation | ||||||||||||
Policyholder dividends provided through earnings | $ | 40.1 | $ | 244.6 | ||||||||
Policyholder dividends provided through OCI | 62.7 | 138.8 | ||||||||||
Additions to (reductions of) policyholder dividend liabilities | 102.8 | 383.4 | ||||||||||
Policyholder dividends paid | (42.5 | ) | (172.2 | ) | ||||||||
Increase (decrease) in policyholder dividend liabilities | 60.3 | 211.2 | ||||||||||
Policyholder dividend liabilities, beginning of period | 916.7 | 705.5 | ||||||||||
Policyholder dividend liabilities, end of period | 977 | 916.7 | ||||||||||
Policyholder dividends payable, end of period | (201.0 | ) | (201.9 | ) | ||||||||
Policyholder dividend obligation, end of period | $ | 776 | $ | 714.8 | ||||||||
Deferred_Policy_Acquisition_Co1
Deferred Policy Acquisition Costs (Tables) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Deferred Policy Acquisition Costs Disclosures [Abstract] | ||||||||
Schedule Of Deferred Policy Acquisition Costs | The balances of and changes in deferred policy acquisition costs (“DAC”) as of and for the periods ended March 31, 2015 and 2014 are as follows: | |||||||
Changes in Deferred Policy Acquisition Costs: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Balance, beginning of period | $ | 848.6 | $ | 947.8 | ||||
Policy acquisition costs deferred | 21.8 | 14.6 | ||||||
Costs amortized to expenses: | ||||||||
Recurring costs | (15.1 | ) | (35.7 | ) | ||||
Assumption unlocking | (6.6 | ) | — | |||||
Realized investment gains (losses) | 4.6 | 11.1 | ||||||
Offsets to net unrealized investment gains or losses | (16.8 | ) | (30.9 | ) | ||||
included in AOCI | ||||||||
Balance, end of period | $ | 836.5 | $ | 906.9 | ||||
Sales_Inducements_Tables
Sales Inducements (Tables) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Deferred Sales Inducements [Abstract] | ||||||||
Changes in Deferred Sales Inducement Activity | The balances of and changes in sales inducements as of and for the periods ended March 31, 2015 and 2014 are as follows: | |||||||
Changes in Deferred Sales Inducement Activity: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Balance, beginning of period | $ | 79.4 | $ | 77.4 | ||||
Sales inducements deferred | 5.3 | 2.1 | ||||||
Amortization charged to income | (1.9 | ) | (0.2 | ) | ||||
Offsets to net unrealized investment gains or losses | (3.6 | ) | (3.2 | ) | ||||
included in AOCI | ||||||||
Balance, end of period | $ | 79.2 | $ | 76.1 | ||||
Investing_Activities_Tables
Investing Activities (Tables) | 3 Months Ended | |||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ||||||||||||||||||||||||
Fair Value and Cost of Securities | The following tables present the debt and equity securities available-for-sale by sector held at March 31, 2015 and December 31, 2014, respectively. The unrealized loss amounts presented below include the non-credit loss component of OTTI losses. We classify these investments into various sectors in line with industry conventions. | |||||||||||||||||||||||
Fair Value and Cost of Securities: | 31-Mar-15 | |||||||||||||||||||||||
($ in millions) | Amortized | Gross | Gross | Fair | OTTI | |||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Recognized | ||||||||||||||||||||
Gains [1] | Losses [1] | in AOCI [2] | ||||||||||||||||||||||
U.S. government and agency | $ | 384.8 | $ | 61.9 | $ | — | $ | 446.7 | $ | — | ||||||||||||||
State and political subdivision | 531.5 | 51.5 | (2.5 | ) | 580.5 | (1.1 | ) | |||||||||||||||||
Foreign government | 218.6 | 29.9 | (0.5 | ) | 248 | — | ||||||||||||||||||
Corporate | 8,148.70 | 626.1 | (62.7 | ) | 8,712.10 | (7.0 | ) | |||||||||||||||||
Commercial mortgage-backed (“CMBS”) | 597.1 | 53.8 | — | 650.9 | (1.2 | ) | ||||||||||||||||||
Residential mortgage-backed (“RMBS”) | 1,794.00 | 86.6 | (9.7 | ) | 1,870.90 | (25.4 | ) | |||||||||||||||||
Collateralized debt obligations (“CDO”) / | 204.1 | 3.6 | (2.2 | ) | 205.5 | (13.1 | ) | |||||||||||||||||
collateralized loan obligations (“CLO”) | ||||||||||||||||||||||||
Other asset-backed (“ABS”) | 261.3 | 13.9 | (4.5 | ) | 270.7 | (1.8 | ) | |||||||||||||||||
Available-for-sale debt securities | $ | 12,140.10 | $ | 927.3 | $ | (82.1 | ) | $ | 12,985.30 | $ | (49.6 | ) | ||||||||||||
Amounts applicable to the closed block | $ | 5,396.70 | $ | 515.1 | $ | (25.7 | ) | $ | 5,886.10 | $ | (14.2 | ) | ||||||||||||
Available-for-sale equity securities | $ | 154.5 | $ | 22.1 | $ | (1.1 | ) | $ | 175.5 | $ | — | |||||||||||||
Amounts applicable to the closed block | $ | 79.1 | $ | 10.7 | $ | (0.8 | ) | $ | 89 | $ | — | |||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Net unrealized investment gains and losses on securities classified as available-for-sale and certain other assets are included in our consolidated balance sheets as a component of AOCI. | |||||||||||||||||||||||
[2] | Represents the amount of non-credit OTTI losses recognized in AOCI excluding net unrealized gains or losses subsequent to the date of impairment. The table above presents the special category of AOCI for debt securities that are other-than-temporarily impaired when the impairment loss has been split between the credit loss component (in earnings) and the non-credit component (separate category of AOCI). | |||||||||||||||||||||||
Fair Value and Cost of Securities: | 31-Dec-14 | |||||||||||||||||||||||
($ in millions) | Amortized | Gross | Gross | Fair | OTTI | |||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Recognized | ||||||||||||||||||||
Gains [1] | Losses [1] | in AOCI [2] | ||||||||||||||||||||||
U.S. government and agency | $ | 388.3 | $ | 55.2 | $ | (0.1 | ) | $ | 443.4 | $ | — | |||||||||||||
State and political subdivision | 518.3 | 42.1 | (2.5 | ) | 557.9 | (1.1 | ) | |||||||||||||||||
Foreign government | 205.8 | 26.5 | (1.4 | ) | 230.9 | — | ||||||||||||||||||
Corporate | 7,942.70 | 530 | (74.6 | ) | 8,398.10 | (8.3 | ) | |||||||||||||||||
CMBS | 602.9 | 48.4 | (0.1 | ) | 651.2 | (1.2 | ) | |||||||||||||||||
RMBS | 1,862.50 | 81.6 | (11.9 | ) | 1,932.20 | (25.5 | ) | |||||||||||||||||
CDO/CLO | 197.5 | 2.7 | (3.3 | ) | 196.9 | (13.9 | ) | |||||||||||||||||
Other ABS | 260 | 13.4 | (4.7 | ) | 268.7 | (1.8 | ) | |||||||||||||||||
Available-for-sale debt securities | $ | 11,978.00 | $ | 799.9 | $ | (98.6 | ) | $ | 12,679.30 | $ | (51.8 | ) | ||||||||||||
Amounts applicable to the closed block | $ | 5,451.30 | $ | 458.1 | $ | (32.4 | ) | $ | 5,877.00 | $ | (14.7 | ) | ||||||||||||
Available-for-sale equity securities | $ | 156 | $ | 25.1 | $ | (1.6 | ) | $ | 179.5 | $ | — | |||||||||||||
Amounts applicable to the closed block | $ | 80.5 | $ | 12.3 | $ | (1.1 | ) | $ | 91.7 | $ | — | |||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Net unrealized investment gains and losses on securities classified as available-for-sale and certain other assets are included in our consolidated balance sheets as a component of AOCI. | |||||||||||||||||||||||
[2] | Represents the amount of non-credit OTTI losses recognized in AOCI excluding net unrealized gains or losses subsequent to the date of impairment. The table above presents the special category of AOCI for debt securities that are other-than-temporarily impaired when the impairment loss has been split between the credit loss component (in earnings) and the non-credit component (separate category of AOCI). | |||||||||||||||||||||||
Maturities of Debt Securities | ||||||||||||||||||||||||
Maturities of Debt Securities: | 31-Mar-15 | |||||||||||||||||||||||
($ in millions) | Amortized | Fair | ||||||||||||||||||||||
Cost | Value | |||||||||||||||||||||||
Due in one year or less | $ | 310.2 | $ | 313.8 | ||||||||||||||||||||
Due after one year through five years | 2,007.00 | 2,139.80 | ||||||||||||||||||||||
Due after five years through ten years | 3,513.30 | 3,711.80 | ||||||||||||||||||||||
Due after ten years | 3,453.10 | 3,821.90 | ||||||||||||||||||||||
CMBS/RMBS/ABS/CDO/CLO [1] | 2,856.50 | 2,998.00 | ||||||||||||||||||||||
Total | $ | 12,140.10 | $ | 12,985.30 | ||||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | CMBS, RMBS, ABS, CDO and CLO are not listed separately in the table as each security does not have a single fixed maturity. | |||||||||||||||||||||||
Sale of Available-for-Sale Securities | The following table depicts the sources of available-for-sale investment proceeds and related investment gains (losses). | |||||||||||||||||||||||
Sales of Available-for-Sale Securities: | Three Months Ended | |||||||||||||||||||||||
($ in millions) | March 31, | |||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||
Debt securities, available-for-sale | ||||||||||||||||||||||||
Proceeds from sales | $ | 155.6 | $ | 48.4 | ||||||||||||||||||||
Proceeds from maturities/repayments | 243.9 | 289.3 | ||||||||||||||||||||||
Gross investment gains from sales, prepayments and maturities | 8.5 | 11.5 | ||||||||||||||||||||||
Gross investment losses from sales and maturities | (0.9 | ) | (3.8 | ) | ||||||||||||||||||||
Equity securities, available-for-sale | ||||||||||||||||||||||||
Proceeds from sales | $ | 1.7 | $ | 4.2 | ||||||||||||||||||||
Gross investment gains from sales | — | 1.9 | ||||||||||||||||||||||
Gross investment losses from sales | — | — | ||||||||||||||||||||||
Aging of Temporarily Impaired Securities | ||||||||||||||||||||||||
Aging of Temporarily Impaired Securities: | 31-Mar-15 | |||||||||||||||||||||||
($ in millions) | Less than 12 months | Greater than 12 months | Total | |||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
Debt Securities | ||||||||||||||||||||||||
U.S. government and agency | $ | — | $ | — | $ | 1.7 | $ | — | $ | 1.7 | $ | — | ||||||||||||
State and political subdivision | 11.3 | (0.6 | ) | 28 | (1.9 | ) | 39.3 | (2.5 | ) | |||||||||||||||
Foreign government | 11.5 | (0.5 | ) | — | — | 11.5 | (0.5 | ) | ||||||||||||||||
Corporate | 443.3 | (21.0 | ) | 439.4 | (41.7 | ) | 882.7 | (62.7 | ) | |||||||||||||||
CMBS | 3.5 | — | — | — | 3.5 | — | ||||||||||||||||||
RMBS | 28.5 | (0.1 | ) | 205.6 | (9.6 | ) | 234.1 | (9.7 | ) | |||||||||||||||
CDO/CLO | 27.2 | (0.2 | ) | 86.7 | (2.0 | ) | 113.9 | (2.2 | ) | |||||||||||||||
Other ABS | 3.2 | — | 15.3 | (4.5 | ) | 18.5 | (4.5 | ) | ||||||||||||||||
Debt securities | 528.5 | (22.4 | ) | 776.7 | (59.7 | ) | 1,305.20 | (82.1 | ) | |||||||||||||||
Equity securities | 7.7 | (0.9 | ) | 15.9 | (0.2 | ) | 23.6 | (1.1 | ) | |||||||||||||||
Total temporarily impaired securities | $ | 536.2 | $ | (23.3 | ) | $ | 792.6 | $ | (59.9 | ) | $ | 1,328.80 | $ | (83.2 | ) | |||||||||
Amounts inside the closed block | $ | 182.2 | $ | (11.0 | ) | $ | 298.2 | $ | (15.5 | ) | $ | 480.4 | $ | (26.5 | ) | |||||||||
Amounts outside the closed block | $ | 354 | $ | (12.3 | ) | $ | 494.4 | $ | (44.4 | ) | $ | 848.4 | $ | (56.7 | ) | |||||||||
Amounts outside the closed block | $ | 84.2 | $ | (5.0 | ) | $ | 60.7 | $ | (7.7 | ) | $ | 144.9 | $ | (12.7 | ) | |||||||||
that are below investment grade | ||||||||||||||||||||||||
Number of securities | 118 | 156 | 274 | |||||||||||||||||||||
Aging of Temporarily Impaired Securities: | 31-Dec-14 | |||||||||||||||||||||||
($ in millions) | Less than 12 months | Greater than 12 months | Total | |||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
Debt Securities | ||||||||||||||||||||||||
U.S. government and agency | $ | — | $ | — | $ | 2.7 | $ | (0.1 | ) | $ | 2.7 | $ | (0.1 | ) | ||||||||||
State and political subdivision | 11.6 | (0.6 | ) | 31.1 | (1.9 | ) | 42.7 | (2.5 | ) | |||||||||||||||
Foreign government | 15.7 | (1.4 | ) | — | — | 15.7 | (1.4 | ) | ||||||||||||||||
Corporate | 643 | (23.5 | ) | 654.3 | (51.1 | ) | 1,297.30 | (74.6 | ) | |||||||||||||||
CMBS | 12.6 | — | 10.9 | (0.1 | ) | 23.5 | (0.1 | ) | ||||||||||||||||
RMBS | 8.4 | (0.2 | ) | 226.7 | (11.7 | ) | 235.1 | (11.9 | ) | |||||||||||||||
CDO/CLO | 57.9 | (0.5 | ) | 96.3 | (2.8 | ) | 154.2 | (3.3 | ) | |||||||||||||||
Other ABS | 13.8 | (0.1 | ) | 16 | (4.6 | ) | 29.8 | (4.7 | ) | |||||||||||||||
Debt securities | 763 | (26.3 | ) | 1,038.00 | (72.3 | ) | 1,801.00 | (98.6 | ) | |||||||||||||||
Equity securities | 5.6 | (0.7 | ) | 15.2 | (0.9 | ) | 20.8 | (1.6 | ) | |||||||||||||||
Total temporarily impaired securities | $ | 768.6 | $ | (27.0 | ) | $ | 1,053.20 | $ | (73.2 | ) | $ | 1,821.80 | $ | (100.2 | ) | |||||||||
Amounts inside the closed block | $ | 266.8 | $ | (11.7 | ) | $ | 387.8 | $ | (21.8 | ) | $ | 654.6 | $ | (33.5 | ) | |||||||||
Amounts outside the closed block | $ | 501.8 | $ | (15.3 | ) | $ | 665.4 | $ | (51.4 | ) | $ | 1,167.20 | $ | (66.7 | ) | |||||||||
Amounts outside the closed block | $ | 84.2 | $ | (4.1 | ) | $ | 50.4 | $ | (6.6 | ) | $ | 134.6 | $ | (10.7 | ) | |||||||||
that are below investment grade | ||||||||||||||||||||||||
Number of securities | 158 | 211 | 369 | |||||||||||||||||||||
Credit Losses Recognized in Earnings on Debt Securities for which a Portion of the OTTI Loss was Recognized in OCI | The following table presents a roll-forward of pre-tax credit losses recognized in earnings related to available-for-sale debt securities for which a portion of the OTTI was recognized in OCI. | |||||||||||||||||||||||
Credit Losses Recognized in Earnings on Available-for-Sale Debt Securities | Three Months Ended | |||||||||||||||||||||||
for which a Portion of the OTTI Loss was Recognized in OCI: | March 31, | |||||||||||||||||||||||
($ in millions) | 2015 | 2014 | ||||||||||||||||||||||
Balance, beginning of period | $ | (52.4 | ) | $ | (71.4 | ) | ||||||||||||||||||
Add: Credit losses on securities not previously impaired [1] | — | — | ||||||||||||||||||||||
Add: Credit losses on securities previously impaired [1] | — | — | ||||||||||||||||||||||
Less: Credit losses on securities impaired due to intent to sell | — | — | ||||||||||||||||||||||
Less: Credit losses on securities sold | 3.2 | 8.3 | ||||||||||||||||||||||
Less: Increases in cash flows expected on | — | — | ||||||||||||||||||||||
previously impaired securities | ||||||||||||||||||||||||
Balance, end of period | $ | (49.2 | ) | $ | (63.1 | ) | ||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Additional credit losses on securities for which a portion of the OTTI loss was recognized in AOCI are included within net OTTI losses recognized in earnings on the consolidated statements of income and comprehensive income. | |||||||||||||||||||||||
Limited partnerships and other investments | Limited partnerships and other investments | |||||||||||||||||||||||
Limited Partnerships and Other Investments: | March 31, | 31-Dec-14 | ||||||||||||||||||||||
($ in millions) | 2015 | |||||||||||||||||||||||
Limited partnerships | ||||||||||||||||||||||||
Private equity funds | $ | 249.7 | $ | 241.1 | ||||||||||||||||||||
Mezzanine funds | 165.1 | 162.4 | ||||||||||||||||||||||
Infrastructure funds | 38.4 | 38.9 | ||||||||||||||||||||||
Hedge funds | 11 | 10.7 | ||||||||||||||||||||||
Mortgage and real estate funds | 4.2 | 3.7 | ||||||||||||||||||||||
Leveraged leases | 10.3 | 11.8 | ||||||||||||||||||||||
Direct equity investments | 38.2 | 49.6 | ||||||||||||||||||||||
Life settlements | 22.6 | 22.4 | ||||||||||||||||||||||
Other alternative assets | 2.2 | 2.2 | ||||||||||||||||||||||
Limited partnerships and other investments | $ | 541.7 | $ | 542.8 | ||||||||||||||||||||
Amounts applicable to the closed block | $ | 347.1 | $ | 343.4 | ||||||||||||||||||||
Sources of Net Investment Income | ||||||||||||||||||||||||
Sources of Net Investment Income: | Three Months Ended | |||||||||||||||||||||||
March 31, | ||||||||||||||||||||||||
($ in millions) | 2015 | 2014 | ||||||||||||||||||||||
Debt securities [1] | $ | 148.8 | $ | 143.8 | ||||||||||||||||||||
Equity securities | 1.9 | 2.1 | ||||||||||||||||||||||
Limited partnerships and other investments | 13.2 | 26.5 | ||||||||||||||||||||||
Policy loans | 41.7 | 41.2 | ||||||||||||||||||||||
Fair value investments | 11.1 | 2.1 | ||||||||||||||||||||||
Total investment income | 216.7 | 215.7 | ||||||||||||||||||||||
Less: Discontinued operations | 0.3 | 0.3 | ||||||||||||||||||||||
Less: Investment expenses | 7.1 | 3.9 | ||||||||||||||||||||||
Net investment income | $ | 209.3 | $ | 211.5 | ||||||||||||||||||||
Amounts applicable to the closed block | $ | 100.2 | $ | 107.3 | ||||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Includes net investment income on short-term investments. | |||||||||||||||||||||||
Sources and Types of Net Realized Investment Gains (Losses) | ||||||||||||||||||||||||
Sources and Types of | Three Months Ended | |||||||||||||||||||||||
Net Realized Gains (Losses): | March 31, | |||||||||||||||||||||||
($ in millions) | 2015 | 2014 | ||||||||||||||||||||||
Total other-than-temporary debt impairments | $ | (0.1 | ) | $ | 0.2 | |||||||||||||||||||
Portion of losses recognized in OCI | (1.4 | ) | (0.2 | ) | ||||||||||||||||||||
Net debt impairments recognized in earnings | $ | (1.5 | ) | $ | — | |||||||||||||||||||
Debt security impairments: | ||||||||||||||||||||||||
U.S. government and agency | $ | — | $ | — | ||||||||||||||||||||
State and political subdivision | — | — | ||||||||||||||||||||||
Foreign government | — | — | ||||||||||||||||||||||
Corporate | (1.3 | ) | ||||||||||||||||||||||
CMBS | — | — | ||||||||||||||||||||||
RMBS | (0.2 | ) | — | |||||||||||||||||||||
CDO/CLO | — | — | ||||||||||||||||||||||
Other ABS | — | — | ||||||||||||||||||||||
Net debt security impairments | (1.5 | ) | — | |||||||||||||||||||||
Equity security impairments | (6.9 | ) | (0.2 | ) | ||||||||||||||||||||
Limited partnerships and other investment impairments | — | — | ||||||||||||||||||||||
Impairment losses | (8.4 | ) | (0.2 | ) | ||||||||||||||||||||
Debt security transaction gains | 8.5 | 11.6 | ||||||||||||||||||||||
Debt security transaction losses | (0.9 | ) | (3.9 | ) | ||||||||||||||||||||
Equity security transaction gains | — | 1.9 | ||||||||||||||||||||||
Equity security transaction losses | — | — | ||||||||||||||||||||||
Limited partnerships and other investment transaction gains | — | — | ||||||||||||||||||||||
Limited partnerships and other investment transaction losses | — | — | ||||||||||||||||||||||
Net transaction gains (losses) | 7.6 | 9.6 | ||||||||||||||||||||||
Derivative instruments | (2.3 | ) | (23.8 | ) | ||||||||||||||||||||
Embedded derivatives [1] | (10.3 | ) | (12.9 | ) | ||||||||||||||||||||
Assets valued at fair value | (2.7 | ) | 0.4 | |||||||||||||||||||||
Net realized gains (losses), excluding impairment losses | (7.7 | ) | (26.7 | ) | ||||||||||||||||||||
Net realized gains (losses), including impairment losses | $ | (16.1 | ) | $ | (26.9 | ) | ||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Includes the change in fair value of embedded derivatives associated with fixed index annuity indexed crediting feature and variable annuity riders. See Note 11 to these consolidated interim unaudited financial statements for additional disclosures. | |||||||||||||||||||||||
Sources of Changes in Net Unrealized Investment Gains (Losses) | ||||||||||||||||||||||||
Sources of Changes in | Three Months Ended | |||||||||||||||||||||||
Net Unrealized Gains (Losses): | March 31, | |||||||||||||||||||||||
($ in millions) | 2015 | 2014 | ||||||||||||||||||||||
Debt securities | $ | 143.9 | $ | 166 | ||||||||||||||||||||
Equity securities | (2.5 | ) | 2.1 | |||||||||||||||||||||
Other investments | (0.2 | ) | 0.4 | |||||||||||||||||||||
Net unrealized investment gains (losses) | $ | 141.2 | $ | 168.5 | ||||||||||||||||||||
Net unrealized investment gains (losses) | $ | 141.2 | $ | 168.5 | ||||||||||||||||||||
Applicable to closed block policyholder dividend obligation | 62.7 | 81.6 | ||||||||||||||||||||||
Applicable to DAC | 16.8 | 30.9 | ||||||||||||||||||||||
Applicable to other actuarial offsets | 58.3 | 32.3 | ||||||||||||||||||||||
Applicable to deferred income tax expense (benefit) | 7 | 32.7 | ||||||||||||||||||||||
Offsets to net unrealized investment gains (losses) | 144.8 | 177.5 | ||||||||||||||||||||||
Net unrealized gains (losses) included in OCI | $ | (3.6 | ) | $ | (9.0 | ) | ||||||||||||||||||
Carrying Value of Assets and Liabilities for Consolidated Variable Interest Entities | ||||||||||||||||||||||||
Carrying Value of Assets and Liabilities | 31-Mar-15 | 31-Dec-14 | ||||||||||||||||||||||
and Maximum Exposure Loss Relating | ||||||||||||||||||||||||
to Variable Interest Entities: | ||||||||||||||||||||||||
($ in millions) | Assets | Liabilities | Maximum | Assets | Liabilities | Maximum | ||||||||||||||||||
Exposure | Exposure | |||||||||||||||||||||||
to Loss [1] | to Loss [1] | |||||||||||||||||||||||
Limited partnerships | $ | 116.9 | $ | — | $ | 190.5 | $ | 106 | $ | — | $ | 157.8 | ||||||||||||
LLCs | 35.4 | — | 35.4 | 45.5 | — | 45.5 | ||||||||||||||||||
Total | $ | 152.3 | $ | — | $ | 225.9 | $ | 151.5 | $ | — | $ | 203.3 | ||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Creditors or beneficial interest holders of the VIEs have no recourse to our general credit. Our obligation to the VIEs is limited to the amount of our committed investment. We have not provided material financial or other support that was not contractually required to these VIEs. | |||||||||||||||||||||||
The following table presents the total assets and total liabilities relating to consolidated VIEs at March 31, 2015 and December 31, 2014. | ||||||||||||||||||||||||
Carrying Value of Assets and Liabilities for | March 31, 2015 | 31-Dec-14 | ||||||||||||||||||||||
Consolidated Variable Interest Entities: | ||||||||||||||||||||||||
($ in millions) | Assets | Liabilities | Maximum | Assets | Liabilities | Maximum | ||||||||||||||||||
Exposure | Exposure | |||||||||||||||||||||||
to Loss [1] | to Loss [1] | |||||||||||||||||||||||
Debt securities, at fair value [2] | $ | 12.9 | $ | — | $ | 8.8 | $ | 5.5 | $ | — | $ | 5.1 | ||||||||||||
Equity securities, at fair value [2] | 37.5 | — | 32.6 | 35 | — | 30 | ||||||||||||||||||
Cash and cash equivalents | 10.1 | — | 9.8 | 9.4 | — | 9.3 | ||||||||||||||||||
Investment in partnership interests | 2.1 | — | 1.7 | — | — | — | ||||||||||||||||||
Investment in single asset LLCs | 50.6 | — | 38.8 | 50.6 | — | 36.6 | ||||||||||||||||||
Other assets | 0.7 | — | 0.6 | 0.6 | — | 0.5 | ||||||||||||||||||
Total assets of consolidated VIEs | $ | 113.9 | $ | — | $ | 92.3 | $ | 101.1 | $ | — | $ | 81.5 | ||||||||||||
Total liabilities of consolidated VIEs | $ | — | $ | 0.7 | $ | 0.5 | $ | — | $ | 0.6 | $ | 0.5 | ||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Creditors or beneficial interest holders of the consolidated VIEs have no recourse to our general credit. Our obligation to the VIEs is limited to the amount of our committed investment. We have not provided material financial or other support that was not contractually required to these VIEs. The maximum exposure to loss above at March 31, 2015 and December 31, 2014 excludes unfunded commitments of $9.9 million and $11.9 million, respectively. | |||||||||||||||||||||||
[2] | Included in available-for-sale debt and equity securities, at fair value on the consolidated balance sheets. |
Financing_Activities_Tables
Financing Activities (Tables) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Schedule of Long-term Debt Instruments | Debt is carried net of original issuer discount as follows: | |||||||
Indebtedness at Carrying Value: | March 31, | 31-Dec-14 | ||||||
($ in millions) | 2015 | |||||||
7.15% surplus notes | $ | 126.2 | $ | 126.2 | ||||
7.45% senior unsecured bonds | 252.7 | 252.7 | ||||||
Total indebtedness | $ | 378.9 | $ | 378.9 | ||||
Interest Expense on Indebtedness, including Amortization of Debt Issuance Costs | ||||||||
Interest Expense on Indebtedness, including | Three Months Ended | |||||||
Amortization of Debt Issuance Costs: | March 31, | |||||||
($ in millions) | 2015 | 2014 | ||||||
7.15% surplus notes | $ | 2.3 | $ | 2.3 | ||||
7.45% senior unsecured bonds | 4.8 | 4.8 | ||||||
Interest expense on indebtedness | $ | 7.1 | $ | 7.1 | ||||
Separate_Accounts_Death_Benefi1
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives (Tables) | 3 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives [Abstract] | ||||||||||||||
Separate Account Investments of Account Balances of Variable Annuity Contracts with Guarantees | ||||||||||||||
Separate Account Investments of Account Balances of Variable Annuity Contracts | March 31, | 31-Dec-14 | ||||||||||||
with Insurance Guarantees: | 2015 | |||||||||||||
($ in millions) | ||||||||||||||
Debt securities | $ | 361.9 | $ | 375.9 | ||||||||||
Equity funds | 1,598.70 | 1,638.60 | ||||||||||||
Other | 48.7 | 49.9 | ||||||||||||
Total | $ | 2,009.30 | $ | 2,064.40 | ||||||||||
Changes in Guaranteed Liability Balances | ||||||||||||||
Changes in Guaranteed Insurance Benefit | Three Months Ended | |||||||||||||
Liability Balances: | March 31, 2015 | |||||||||||||
($ in millions) | Annuity | Annuity | ||||||||||||
GMDB | GMIB | |||||||||||||
Balance, beginning of period | $ | 21.4 | $ | 17.1 | ||||||||||
Incurred | (0.6 | ) | (2.5 | ) | ||||||||||
Paid | (0.6 | ) | — | |||||||||||
Assumption unlocking | 0.4 | — | ||||||||||||
Change due to net unrealized gains or losses included in AOCI | 0.1 | — | ||||||||||||
Balance, end of period | $ | 20.7 | $ | 14.6 | ||||||||||
Changes in Guaranteed Insurance Benefit | Three Months Ended | |||||||||||||
Liability Balances: | March 31, 2014 | |||||||||||||
($ in millions) | Annuity | Annuity | ||||||||||||
GMDB | GMIB | |||||||||||||
Balance, beginning of period | $ | 22.7 | $ | 9.8 | ||||||||||
Incurred | (0.1 | ) | (0.1 | ) | ||||||||||
Paid | (0.6 | ) | — | |||||||||||
Assumption unlocking | — | — | ||||||||||||
Change due to net unrealized gains or losses included in AOCI | 0.1 | (0.1 | ) | |||||||||||
Balance, end of period | $ | 22.1 | $ | 9.6 | ||||||||||
Variable Annuity GMDB Benefits by Type | Following are the major types of death benefits currently in force as defined in Note 11 to our consolidated financial statements in the 2014 Form 10-K: | |||||||||||||
GMDB and GMIB Benefits by Type: | 31-Mar-15 | |||||||||||||
($ in millions) | Account | NAR | NAR | Average | ||||||||||
Value | before | after | Attained Age | |||||||||||
Reinsurance | Reinsurance | of Annuitant | ||||||||||||
GMDB return of premium | $ | 638 | $ | 1.4 | $ | 1.4 | 64 | |||||||
GMDB step up | 1,685.70 | 104.8 | 10.5 | 64 | ||||||||||
GMDB earnings enhancement benefit (“EEB”) | 29.1 | — | — | 65 | ||||||||||
GMDB greater of annual step up and roll up | 22.4 | 4.8 | 4.8 | 69 | ||||||||||
Total GMDB at March 31, 2015 | 2,375.20 | $ | 111 | $ | 16.7 | |||||||||
Less: General account value with GMDB | 372.3 | |||||||||||||
Subtotal separate account liabilities with GMDB | 2,002.90 | |||||||||||||
Separate account liabilities without GMDB | 966.5 | |||||||||||||
Total separate account liabilities | $ | 2,969.40 | ||||||||||||
GMIB [1] at March 31, 2015 | $ | 308.3 | 65 | |||||||||||
GMDB and GMIB Benefits by Type: | 31-Dec-14 | |||||||||||||
($ in millions) | Account | NAR | NAR | Average | ||||||||||
Value | before | after | Attained Age | |||||||||||
Reinsurance | Reinsurance | of Annuitant | ||||||||||||
GMDB return of premium | $ | 661.5 | $ | 1.6 | $ | 1.6 | 63 | |||||||
GMDB step up | 1,723.20 | 112.2 | 13.4 | 64 | ||||||||||
GMDB earnings enhancement benefit (“EEB”) | 29.1 | — | — | 65 | ||||||||||
GMDB greater of annual step up and roll up | 22.7 | 4.8 | 4.8 | 69 | ||||||||||
Total GMDB at December 31, 2014 | 2,436.50 | $ | 118.6 | $ | 19.8 | |||||||||
Less: General account value with GMDB | 378.6 | |||||||||||||
Subtotal separate account liabilities with GMDB | 2,057.90 | |||||||||||||
Separate account liabilities without GMDB | 962.8 | |||||||||||||
Total separate account liabilities | $ | 3,020.70 | ||||||||||||
GMIB [1] at December 31, 2014 | $ | 319.6 | 65 | |||||||||||
——————— | ||||||||||||||
[1] | Policies with a GMIB also have a GMDB, however these benefits are not additive. When a policy terminates due to death, any NAR related to GMIB is released. Similarly, when a policy goes into benefit status on a GMIB, its GMDB NAR is released. | |||||||||||||
Changes in Guaranteed Liability Balance | ||||||||||||||
Changes in Additional | Universal Life | |||||||||||||
Liability Balances: | Profits Followed by Losses | |||||||||||||
($ in millions) | Three Months Ended | |||||||||||||
March 31, | ||||||||||||||
2015 | 2014 | |||||||||||||
Balance, beginning of period | $ | 351.5 | $ | 249.1 | ||||||||||
Incurred | 16.7 | 16.1 | ||||||||||||
Assumption unlocking | (6.8 | ) | — | |||||||||||
Change due to net unrealized gains or losses included in AOCI | 26.3 | 14.7 | ||||||||||||
Balance, end of period | $ | 387.7 | $ | 279.9 | ||||||||||
Changes in Guaranteed | Universal Life | |||||||||||||
Liability Balances: | Secondary Guarantees | |||||||||||||
($ in millions) | Three Months Ended | |||||||||||||
March 31, | ||||||||||||||
2015 | 2014 | |||||||||||||
Balance, beginning of period | $ | 195.8 | $ | 170.6 | ||||||||||
Incurred | 10.1 | 8.4 | ||||||||||||
Paid | (6.4 | ) | (1.9 | ) | ||||||||||
Assumption unlocking | — | — | ||||||||||||
Change due to net unrealized gains or losses included in AOCI | 1.4 | 0.9 | ||||||||||||
Balance, end of period | $ | 200.9 | $ | 178 | ||||||||||
Changes in Guaranteed | Fixed Indexed Annuity | |||||||||||||
Liability Balances: | GMWB and GMDB | |||||||||||||
($ in millions) | Three Months Ended | |||||||||||||
March 31, | ||||||||||||||
2015 | 2014 | |||||||||||||
Balance, beginning of period | $ | 147 | $ | 85.4 | ||||||||||
Incurred | 10.5 | 0.3 | ||||||||||||
Paid | (0.1 | ) | (0.1 | ) | ||||||||||
Assumption unlocking | — | — | ||||||||||||
Change due to net unrealized gains or losses included in AOCI | 13.9 | 18.5 | ||||||||||||
Balance, end of period | $ | 171.3 | $ | 104.1 | ||||||||||
Non-Insurance Guaranteed Product Features | Certain separate account variable products may contain a GMWB, guaranteed minimum accumulation benefit (“GMAB”) and/or combination (“COMBO”) rider as defined in Note 11 to our consolidated financial statements in the 2014 Form 10-K. These features are accounted for as embedded derivatives as described below. | |||||||||||||
Embedded Derivatives Non-Insurance Guaranteed Product Features: | 31-Mar-15 | |||||||||||||
($ in millions) | Account | Average | ||||||||||||
Value | Attained Age | |||||||||||||
of Annuitant | ||||||||||||||
GMWB | $ | 477.7 | 65 | |||||||||||
GMAB | 300.6 | 59 | ||||||||||||
COMBO | 5.4 | 64 | ||||||||||||
Balance, end of period | $ | 783.7 | ||||||||||||
Embedded Derivatives Non-Insurance Guaranteed Product Features: | 31-Dec-14 | |||||||||||||
($ in millions) | Account | Average | ||||||||||||
Value | Attained Age | |||||||||||||
of Annuitant | ||||||||||||||
GMWB | $ | 496.8 | 65 | |||||||||||
GMAB | 315.6 | 59 | ||||||||||||
COMBO | 7.1 | 65 | ||||||||||||
Balance, end of period | $ | 819.5 | ||||||||||||
Variable Annuity Embedded Derivative Liabilities | Embedded derivative liabilities for GMWB, GMAB and COMBO are shown in the table below. | |||||||||||||
Embedded Derivative Liabilities: | March 31, | 31-Dec-14 | ||||||||||||
($ in millions) | 2015 | |||||||||||||
GMWB | $ | 9.5 | $ | 7.3 | ||||||||||
GMAB | (0.7 | ) | (0.3 | ) | ||||||||||
COMBO | (0.1 | ) | (0.2 | ) | ||||||||||
Total variable annuity embedded derivative liabilities | $ | 8.7 | $ | 6.8 | ||||||||||
Derivative_Instruments_Tables
Derivative Instruments (Tables) | 3 Months Ended | |||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||
Derivative Instruments | ||||||||||||||||||||||||
Derivative Instruments: | Maturity | Notional | Fair Value as of | |||||||||||||||||||||
Amount | March 31, 2015 | |||||||||||||||||||||||
($ in millions) | Assets | Liabilities [1] | ||||||||||||||||||||||
Interest rate swaps | 2018 - 2035 | $ | 149 | $ | 4 | $ | 0.4 | |||||||||||||||||
Variance swaps | 2015 - 2017 | 0.9 | — | 9 | ||||||||||||||||||||
Put options | 2015 - 2022 | 692.5 | 26.8 | — | ||||||||||||||||||||
Call options [2] | 2015 - 2019 | 2,169.30 | 107.7 | 67.7 | ||||||||||||||||||||
Cross currency swaps | 2016 | 10 | 1.7 | — | ||||||||||||||||||||
Equity futures | 2015 | 9.6 | — | — | ||||||||||||||||||||
Total derivative instruments | $ | 3,031.30 | $ | 140.2 | $ | 77.1 | ||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Derivative liabilities are included in other liabilities on the consolidated balance sheets. | |||||||||||||||||||||||
[2] | Includes a contingent receivable of $1.4 million. | |||||||||||||||||||||||
Derivative Instruments: | Maturity | Notional | Fair Value as of | |||||||||||||||||||||
Amount | December 31, 2014 | |||||||||||||||||||||||
($ in millions) | Assets | Liabilities [1] | ||||||||||||||||||||||
Interest rate swaps | 2016 - 2029 | $ | 114 | $ | 9.7 | $ | 1.9 | |||||||||||||||||
Variance swaps | 2015 - 2017 | 0.9 | — | 8.6 | ||||||||||||||||||||
Swaptions | 2024 - 2025 | 777 | 0.1 | — | ||||||||||||||||||||
Put options | 2015 - 2022 | 692.5 | 31.1 | — | ||||||||||||||||||||
Call options [2] | 2015 - 2019 | 2,019.20 | 119.8 | 74.6 | ||||||||||||||||||||
Cross currency swaps | 2016 | 10 | 0.6 | — | ||||||||||||||||||||
Equity futures | 2015 | 4.1 | — | 0.5 | ||||||||||||||||||||
Total derivative instruments | $ | 3,617.70 | $ | 161.3 | $ | 85.6 | ||||||||||||||||||
——————— | ||||||||||||||||||||||||
[1] | Derivative liabilities are included in other liabilities on the consolidated balance sheets. | |||||||||||||||||||||||
[2] | Includes a contingent receivable of $1.5 million. | |||||||||||||||||||||||
Derivative Instrument Gains (Losses) Recognized in Earnings | ||||||||||||||||||||||||
Derivative Instrument Gains (Losses) Recognized in | Three Months Ended | |||||||||||||||||||||||
Realized Investment Gains (Losses): | March 31, | |||||||||||||||||||||||
($ in millions) | 2015 | 2014 | ||||||||||||||||||||||
Interest rate swaps | $ | 2.7 | $ | 5 | ||||||||||||||||||||
Variance swaps | (0.4 | ) | (0.6 | ) | ||||||||||||||||||||
Swaptions | (0.1 | ) | (18.3 | ) | ||||||||||||||||||||
Put options | (4.2 | ) | (4.2 | ) | ||||||||||||||||||||
Call options | (1.5 | ) | (3.0 | ) | ||||||||||||||||||||
Cross currency swaps | 1 | (0.1 | ) | |||||||||||||||||||||
Equity futures | 0.2 | (2.6 | ) | |||||||||||||||||||||
Embedded derivatives | (10.3 | ) | (12.9 | ) | ||||||||||||||||||||
Total derivative instrument gains (losses) recognized in | $ | (12.6 | ) | $ | (36.7 | ) | ||||||||||||||||||
realized investment gains (losses) | ||||||||||||||||||||||||
Offsetting Assets and Liabilities | The following tables present the gross fair value amounts, the amounts offset and net position of derivative instruments eligible for offset in the Company’s consolidated balance sheets that are subject to an enforceable master netting arrangement upon certain termination events, irrespective of whether they are offset in the balance sheet. | |||||||||||||||||||||||
Offsetting of | March 31, 2015 | |||||||||||||||||||||||
Derivative Assets/Liabilities: | ||||||||||||||||||||||||
($ in millions) | Gross | Gross | Net amounts | Gross amounts not offset | Net amount | |||||||||||||||||||
amounts | amounts | presented | in the balance sheet | |||||||||||||||||||||
recognized [1] | offset in the | in the | ||||||||||||||||||||||
balance sheet | balance sheet | Financial | Cash collateral | |||||||||||||||||||||
instruments | pledged [2] | |||||||||||||||||||||||
Total derivative assets | $ | 140.2 | $ | — | $ | 140.2 | $ | (73.4 | ) | $ | — | $ | 66.8 | |||||||||||
Total derivative liabilities | $ | (77.1 | ) | $ | — | $ | (77.1 | ) | $ | 73.4 | $ | 3.7 | $ | — | ||||||||||
Offsetting of | December 31, 2014 | |||||||||||||||||||||||
Derivative Assets/Liabilities: | ||||||||||||||||||||||||
($ in millions) | Gross | Gross | Net amounts | Gross amounts not offset | Net amount | |||||||||||||||||||
amounts | amounts | presented | in the balance sheet | |||||||||||||||||||||
recognized [1] | offset in the | in the | ||||||||||||||||||||||
balance sheet | balance sheet | Financial | Cash collateral | |||||||||||||||||||||
instruments | pledged [2] | |||||||||||||||||||||||
Total derivative assets | $ | 161.3 | $ | — | $ | 161.3 | $ | (82.5 | ) | $ | — | $ | 78.8 | |||||||||||
Total derivative liabilities | $ | (85.6 | ) | $ | — | $ | (85.6 | ) | $ | 82.5 | $ | 3.1 | $ | — | ||||||||||
——————— | ||||||||||||||||||||||||
[1] | Amounts include all derivative instruments, irrespective of whether there is a legally enforceable master netting arrangement in place. | |||||||||||||||||||||||
[2] | Cash collateral pledged with derivative counterparties is recorded within other assets on the consolidated balance sheets. The Company pledges cash collateral to offset certain individual derivative liability positions with certain counterparties. Cash collateral of $18.9 million and $15.5 million as of March 31, 2015 and December 31, 2014, respectively, that exceeds the net liability resulting from the aggregate derivative positions with a corresponding counterparty is excluded. |
Fair_Value_of_Financial_Instru1
Fair Value of Financial Instruments (Tables) | 3 Months Ended | |||||||||||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||
Financial instruments carried at fair value by ASC 820-10 valuation hierarchy | The following tables present the financial instruments carried at fair value on a recurring basis by ASC 820-10 valuation hierarchy (as described above). There were no financial instruments carried at fair value on a non-recurring basis as of March 31, 2015 and December 31, 2014, respectively. | |||||||||||||||||||||||||||||||
Fair Values of Financial Instruments by Level: | 31-Mar-15 | |||||||||||||||||||||||||||||||
($ in millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [1] | $ | — | $ | 80.3 | $ | 366.4 | $ | 446.7 | ||||||||||||||||||||||||
State and political subdivision | — | 175.1 | 405.4 | 580.5 | ||||||||||||||||||||||||||||
Foreign government | — | 215.6 | 32.4 | 248 | ||||||||||||||||||||||||||||
Corporate | — | 4,358.00 | 4,354.10 | 8,712.10 | ||||||||||||||||||||||||||||
CMBS | — | 615.7 | 35.2 | 650.9 | ||||||||||||||||||||||||||||
RMBS | — | 1,389.30 | 481.6 | 1,870.90 | ||||||||||||||||||||||||||||
CDO/CLO | — | — | 205.5 | 205.5 | ||||||||||||||||||||||||||||
Other ABS | — | 61.8 | 208.9 | 270.7 | ||||||||||||||||||||||||||||
Total available-for-sale debt securities | — | 6,895.80 | 6,089.50 | 12,985.30 | ||||||||||||||||||||||||||||
Available-for-sale equity securities | — | — | 175.5 | 175.5 | ||||||||||||||||||||||||||||
Short-term investments | 154.7 | — | — | 154.7 | ||||||||||||||||||||||||||||
Derivative assets | — | 140.2 | — | 140.2 | ||||||||||||||||||||||||||||
Fair value investments [2] | 32.7 | 13.2 | 204.9 | 250.8 | ||||||||||||||||||||||||||||
Separate account assets | 2,969.40 | — | — | 2,969.40 | ||||||||||||||||||||||||||||
Total assets | $ | 3,156.80 | $ | 7,049.20 | $ | 6,469.90 | $ | 16,675.90 | ||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||
Derivative liabilities | $ | — | $ | 77.1 | $ | — | $ | 77.1 | ||||||||||||||||||||||||
Embedded derivatives | — | — | 175.6 | 175.6 | ||||||||||||||||||||||||||||
Total liabilities | $ | — | $ | 77.1 | $ | 175.6 | $ | 252.7 | ||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Level 3 includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
[2] | Fair value investments at March 31, 2015 include $115.0 million of debt securities recorded at fair value. In addition, we have also elected the fair value option for equity securities backing our deferred compensation liabilities at $23.8 million as of March 31, 2015. Changes in the fair value of these assets are recorded through net investment income. Additionally, $112.0 million of assets relate to investment holdings of consolidated VIEs held at fair value, $8.9 million of which are Level 1 securities. | |||||||||||||||||||||||||||||||
There were no transfers of assets between Level 1 and Level 2 during the three months ended March 31, 2015. | ||||||||||||||||||||||||||||||||
Fair Values of Financial Instruments by Level: | 31-Dec-14 | |||||||||||||||||||||||||||||||
($ in millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [1] | $ | — | $ | 81.2 | $ | 362.2 | $ | 443.4 | ||||||||||||||||||||||||
State and political subdivision | — | 157.7 | 400.2 | 557.9 | ||||||||||||||||||||||||||||
Foreign government | — | 177.3 | 53.6 | 230.9 | ||||||||||||||||||||||||||||
Corporate | — | 3,994.20 | 4,403.90 | 8,398.10 | ||||||||||||||||||||||||||||
CMBS | — | 498.4 | 152.8 | 651.2 | ||||||||||||||||||||||||||||
RMBS | — | 1,461.90 | 470.3 | 1,932.20 | ||||||||||||||||||||||||||||
CDO/CLO | — | — | 196.9 | 196.9 | ||||||||||||||||||||||||||||
Other ABS | — | 23.6 | 245.1 | 268.7 | ||||||||||||||||||||||||||||
Total available-for-sale debt securities | — | 6,394.30 | 6,285.00 | 12,679.30 | ||||||||||||||||||||||||||||
Available-for-sale equity securities | — | — | 179.5 | 179.5 | ||||||||||||||||||||||||||||
Short-term investments | 149.7 | — | — | 149.7 | ||||||||||||||||||||||||||||
Derivative assets | — | 161.3 | — | 161.3 | ||||||||||||||||||||||||||||
Fair value investments [2] | 32.4 | 13 | 190 | 235.4 | ||||||||||||||||||||||||||||
Separate account assets | 3,020.70 | — | — | 3,020.70 | ||||||||||||||||||||||||||||
Total assets | $ | 3,202.80 | $ | 6,568.60 | $ | 6,654.50 | $ | 16,425.90 | ||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||
Derivative liabilities | $ | 0.5 | $ | 85.1 | $ | — | $ | 85.6 | ||||||||||||||||||||||||
Embedded derivatives | — | — | 160.7 | 160.7 | ||||||||||||||||||||||||||||
Total liabilities | $ | 0.5 | $ | 85.1 | $ | 160.7 | $ | 246.3 | ||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Level 3 includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
[2] | Fair value investments at December 31, 2014 include $111.9 million of debt securities recorded at fair value. In addition, we have also elected the fair value option for equity securities backing our deferred compensation liabilities at $23.5 million as of December 31, 2014. Changes in the fair value of these assets are recorded through net investment income. Additionally, $100.0 million of assets relate to investment holdings of consolidated VIEs held at fair value, $8.8 million of which are Level 1 securities. | |||||||||||||||||||||||||||||||
Corporates fair value on a recurring basis | The following tables present corporates carried at fair value and on a recurring basis by sector. | |||||||||||||||||||||||||||||||
Fair Values of Corporates by Level and Sector: | 31-Mar-15 | |||||||||||||||||||||||||||||||
($ in millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||||
Corporates | ||||||||||||||||||||||||||||||||
Consumer | $ | — | $ | 618.3 | $ | 1,286.80 | $ | 1,905.10 | ||||||||||||||||||||||||
Energy | — | 614.7 | 443.1 | 1,057.80 | ||||||||||||||||||||||||||||
Financial services | — | 1,785.70 | 898.1 | 2,683.80 | ||||||||||||||||||||||||||||
Capital goods | — | 402.7 | 352.5 | 755.2 | ||||||||||||||||||||||||||||
Transportation | — | 120.7 | 313.5 | 434.2 | ||||||||||||||||||||||||||||
Utilities | — | 372.7 | 719.3 | 1,092.00 | ||||||||||||||||||||||||||||
Other | — | 443.2 | 340.8 | 784 | ||||||||||||||||||||||||||||
Total corporates | $ | — | $ | 4,358.00 | $ | 4,354.10 | $ | 8,712.10 | ||||||||||||||||||||||||
Fair Values of Corporates by Level and Sector: | 31-Dec-14 | |||||||||||||||||||||||||||||||
($ in millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||||
Corporates | ||||||||||||||||||||||||||||||||
Consumer | $ | — | $ | 593 | $ | 1,266.60 | $ | 1,859.60 | ||||||||||||||||||||||||
Energy | — | 534.6 | 472.8 | 1,007.40 | ||||||||||||||||||||||||||||
Financial services | — | 1,617.30 | 967.9 | 2,585.20 | ||||||||||||||||||||||||||||
Capital goods | — | 398.1 | 384.8 | 782.9 | ||||||||||||||||||||||||||||
Transportation | — | 104.7 | 305.8 | 410.5 | ||||||||||||||||||||||||||||
Utilities | — | 348.1 | 683.4 | 1,031.50 | ||||||||||||||||||||||||||||
Other | — | 398.4 | 322.6 | 721 | ||||||||||||||||||||||||||||
Total corporates | $ | — | $ | 3,994.20 | $ | 4,403.90 | $ | 8,398.10 | ||||||||||||||||||||||||
Fair value hierarchy | The following tables set forth a summary of changes in the fair value of our Level 3 financial assets and liabilities. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Transfers in and out of Level 3 occur at the beginning of each period. The securities which were transferred into Level 3 were due to decreased market observability of similar assets and/or changes to significant inputs, such as downgrades or price declines. Transfers out of Level 3 were due to increased market activity on comparable assets or observability of inputs. | |||||||||||||||||||||||||||||||
Level 3 Financial Assets: | Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||
($ in millions) | Balance, | Purchases | Sales | Transfers | Transfers | Realized and | Unrealized | Total | ||||||||||||||||||||||||
beginning | into | out of | unrealized | gains | ||||||||||||||||||||||||||||
of period | Level 3 | Level 3 | gains | (losses) | ||||||||||||||||||||||||||||
(losses) | included | |||||||||||||||||||||||||||||||
included in | in OCI | |||||||||||||||||||||||||||||||
income [1] | ||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [2] | $ | 362.2 | $ | — | $ | (2.1 | ) | $ | — | $ | — | $ | — | $ | 6.3 | $ | 366.4 | |||||||||||||||
State and political subdivision | 400.2 | 13.6 | (2.2 | ) | — | (14.0 | ) | — | 7.8 | 405.4 | ||||||||||||||||||||||
Foreign government | 53.6 | — | (0.2 | ) | 4.2 | (26.7 | ) | — | 1.5 | 32.4 | ||||||||||||||||||||||
Corporate | 4,403.90 | 220.3 | (113.0 | ) | 62.3 | (285.2 | ) | 2.1 | 63.7 | 4,354.10 | ||||||||||||||||||||||
CMBS | 152.8 | — | (0.1 | ) | 8.5 | (126.1 | ) | — | 0.1 | 35.2 | ||||||||||||||||||||||
RMBS | 470.3 | 0.3 | (17.6 | ) | 29.2 | — | (0.2 | ) | (0.4 | ) | 481.6 | |||||||||||||||||||||
CDO/CLO | 196.9 | 24.5 | (18.4 | ) | — | — | 0.5 | 2 | 205.5 | |||||||||||||||||||||||
Other ABS | 245.1 | — | (7.0 | ) | — | (29.2 | ) | (0.4 | ) | 0.4 | 208.9 | |||||||||||||||||||||
Total available-for-sale | 6,285.00 | 258.7 | (160.6 | ) | 104.2 | (481.2 | ) | 2 | 81.4 | 6,089.50 | ||||||||||||||||||||||
debt securities | ||||||||||||||||||||||||||||||||
Available-for-sale equity securities | 179.5 | 7.2 | (1.7 | ) | — | — | (6.2 | ) | (3.3 | ) | 175.5 | |||||||||||||||||||||
Fair value investments | 190 | 0.4 | (1.9 | ) | — | — | 16.4 | — | 204.9 | |||||||||||||||||||||||
Total assets | $ | 6,654.50 | $ | 266.3 | $ | (164.2 | ) | $ | 104.2 | $ | (481.2 | ) | $ | 12.2 | $ | 78.1 | $ | 6,469.90 | ||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Reflected in realized investment gains and losses for all assets except fair value investments which are included in net investment income. | |||||||||||||||||||||||||||||||
[2] | Includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
Level 3 Financial Assets: | Three Months Ended March 31, 2014 | |||||||||||||||||||||||||||||||
($ in millions) | Balance, | Purchases | Sales | Transfers | Transfers | Realized and | Unrealized | Total | ||||||||||||||||||||||||
beginning | into | out of | unrealized | gains | ||||||||||||||||||||||||||||
of period | Level 3 | Level 3 | gains | (losses) | ||||||||||||||||||||||||||||
(losses) | included | |||||||||||||||||||||||||||||||
included in | in OCI | |||||||||||||||||||||||||||||||
income [1] | ||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [2] | $ | 327.2 | $ | 12.9 | $ | (5.4 | ) | $ | — | $ | — | $ | — | $ | 5.7 | $ | 340.4 | |||||||||||||||
State and political subdivision | 269.1 | 2.9 | (0.8 | ) | — | — | — | 5.6 | 276.8 | |||||||||||||||||||||||
Foreign government | 15.9 | — | (1.0 | ) | — | — | — | 1.2 | 16.1 | |||||||||||||||||||||||
Corporate | 3,893.80 | 171 | (115.9 | ) | — | (127.0 | ) | 2.5 | 115.9 | 3,940.30 | ||||||||||||||||||||||
CMBS | 113.7 | — | (2.7 | ) | — | (60.1 | ) | (0.1 | ) | 1.3 | 52.1 | |||||||||||||||||||||
RMBS | 552.7 | 0.5 | (21.7 | ) | — | — | 1.9 | 1.8 | 535.2 | |||||||||||||||||||||||
CDO/CLO | 224.1 | 23 | (12.3 | ) | — | — | 1.8 | (0.5 | ) | 236.1 | ||||||||||||||||||||||
Other ABS | 247.7 | — | (13.3 | ) | — | (1.7 | ) | 0.1 | (3.4 | ) | 229.4 | |||||||||||||||||||||
Total available-for-sale | 5,644.20 | 210.3 | (173.1 | ) | — | (188.8 | ) | 6.2 | 127.6 | 5,626.40 | ||||||||||||||||||||||
debt securities | ||||||||||||||||||||||||||||||||
Available-for-sale equity securities | 135.2 | 6.7 | (1.3 | ) | — | — | 0.5 | (78.1 | ) | 63 | ||||||||||||||||||||||
Short-term investments | 0.9 | — | — | — | — | — | (0.9 | ) | — | |||||||||||||||||||||||
Fair value investments | 169.9 | — | (2.5 | ) | — | — | 2.9 | — | 170.3 | |||||||||||||||||||||||
Total assets | $ | 5,950.20 | $ | 217 | $ | (176.9 | ) | $ | — | $ | (188.8 | ) | $ | 9.6 | $ | 48.6 | $ | 5,859.70 | ||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Reflected in realized investment gains and losses for all assets except fair value investments which are included in net investment income. | |||||||||||||||||||||||||||||||
[2] | Includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
Embedded Derivative Liabilities | ||||||||||||||||||||||||||||||||
Level 3 Financial Liabilities: | Embedded Derivative Liabilities | |||||||||||||||||||||||||||||||
($ in millions) | Three Months Ended | |||||||||||||||||||||||||||||||
March 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||||||||||
Balance, beginning of period | $ | 160.7 | $ | 87.8 | ||||||||||||||||||||||||||||
Net purchases/(sales) | 4.6 | 8.3 | ||||||||||||||||||||||||||||||
Transfers into Level 3 | — | — | ||||||||||||||||||||||||||||||
Transfers out of Level 3 | — | — | ||||||||||||||||||||||||||||||
Realized (gains) losses | 10.3 | 12.9 | ||||||||||||||||||||||||||||||
Balance, end of period | $ | 175.6 | $ | 109 | ||||||||||||||||||||||||||||
Fair Value Inputs, Assets, Quantitative Information | The following tables present quantitative estimates about unobservable inputs used in the fair value measurement of significant categories of internally priced assets. | |||||||||||||||||||||||||||||||
Level 3 Assets: [1] | 31-Mar-15 | |||||||||||||||||||||||||||||||
($ in millions) | Fair | Valuation | Unobservable | Range | ||||||||||||||||||||||||||||
Value | Technique(s) | Input | (Weighted Average) | |||||||||||||||||||||||||||||
U.S. government and agency | $ | 366.4 | Discounted cash flow | Yield | 0.86% - 4.04% (2.91%) | |||||||||||||||||||||||||||
State and political subdivision | $ | 208 | Discounted cash flow | Yield | 1.85% - 4.25% (2.91%) | |||||||||||||||||||||||||||
Corporate | $ | 3,351.60 | Discounted cash flow | Yield | 0.85% - 6.56% (2.96%) | |||||||||||||||||||||||||||
Other ABS | $ | 38 | Discounted cash flow | Yield | 0.70% - 2.60% (1.69%) | |||||||||||||||||||||||||||
Fair value investments | $ | 6.4 | Discounted cash flow | Default rate | 0.18% | |||||||||||||||||||||||||||
Recovery rate | 44.00% | |||||||||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Excludes Level 3 assets which are valued based upon non-binding independent third-party valuations or third-party price information for which unobservable inputs are not reasonably available to us. | |||||||||||||||||||||||||||||||
Level 3 Assets: [1] | 31-Dec-14 | |||||||||||||||||||||||||||||||
($ in millions) | Fair | Valuation | Unobservable | Range | ||||||||||||||||||||||||||||
Value | Technique(s) | Input | (Weighted Average) | |||||||||||||||||||||||||||||
U.S. government and agency | $ | 362.2 | Discounted cash flow | Yield | 0.99% - 4.27% (3.17%) | |||||||||||||||||||||||||||
State and political subdivision | $ | 159.1 | Discounted cash flow | Yield | 2.15% - 4.50% (3.22%) | |||||||||||||||||||||||||||
Corporate | $ | 3,116.60 | Discounted cash flow | Yield | 0.93% - 6.88% (3.24%) | |||||||||||||||||||||||||||
Other ABS | $ | 39.3 | Discounted cash flow | Yield | 0.60% - 4.00% (1.92%) | |||||||||||||||||||||||||||
Fair value investments | $ | 6.3 | Discounted cash flow | Default rate | 0.17% | |||||||||||||||||||||||||||
Recovery rate | 44.00% | |||||||||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Excludes Level 3 assets which are valued based upon non-binding independent third-party valuations or third-party price information for which unobservable inputs are not reasonably available to us. | |||||||||||||||||||||||||||||||
Fair Value Inputs, Liabilities, Quantitative Information | The following tables present quantitative estimates about unobservable inputs used in the fair value measurement of internally priced liabilities. | |||||||||||||||||||||||||||||||
Level 3 Liabilities: | 31-Mar-15 | |||||||||||||||||||||||||||||||
($ in millions) | Fair | Valuation | Unobservable | Range | ||||||||||||||||||||||||||||
Value | Technique(s) | Input | ||||||||||||||||||||||||||||||
Embedded derivatives (VA / FIA) | $ | 166.9 | Budget method | Swap curve | 0.31% - 2.27% | |||||||||||||||||||||||||||
Mortality rate | 105% or 97 % 2012 IAM basic table | |||||||||||||||||||||||||||||||
with scale G2 | ||||||||||||||||||||||||||||||||
Lapse rate | 0.04% - 46.44% | |||||||||||||||||||||||||||||||
CSA | 3.19% | |||||||||||||||||||||||||||||||
Embedded derivatives | $ | 8.7 | Risk neutral stochastic | Volatility surface | 8.58% - 50.72% | |||||||||||||||||||||||||||
(GMAB / GMWB / COMBO) | valuation methodology | |||||||||||||||||||||||||||||||
Swap curve | 0.22% - 2.44% | |||||||||||||||||||||||||||||||
Mortality rate | 105% 2012 IAM basic table | |||||||||||||||||||||||||||||||
with scale G2 | ||||||||||||||||||||||||||||||||
Lapse rate | 0.00% - 40.00% | |||||||||||||||||||||||||||||||
CSA | 3.19% | |||||||||||||||||||||||||||||||
Level 3 Liabilities: | 31-Dec-14 | |||||||||||||||||||||||||||||||
($ in millions) | Fair | Valuation | Unobservable | Range | ||||||||||||||||||||||||||||
Value | Technique(s) | Input | ||||||||||||||||||||||||||||||
Embedded derivatives (VA / FIA) | $ | 153.9 | Budget method | Swap curve | 0.24% - 2.55% | |||||||||||||||||||||||||||
Mortality rate | 105% or 97% 2012 IAM basic table | |||||||||||||||||||||||||||||||
with scale G2 | ||||||||||||||||||||||||||||||||
Lapse rate | 0.04% - 46.44% | |||||||||||||||||||||||||||||||
CSA | 3.08% | |||||||||||||||||||||||||||||||
Embedded derivatives | $ | 6.8 | Risk neutral stochastic | Volatility surface | 9.89% - 67.34% | |||||||||||||||||||||||||||
(GMAB / GMWB / COMBO) | valuation methodology | |||||||||||||||||||||||||||||||
Swap curve | 0.21% - 2.76% | |||||||||||||||||||||||||||||||
Mortality rate | 105% 2012 IAM basic table | |||||||||||||||||||||||||||||||
with scale G2 | ||||||||||||||||||||||||||||||||
Lapse rate | 0.00% - 40.00% | |||||||||||||||||||||||||||||||
CSA | 3.08% | |||||||||||||||||||||||||||||||
Level 3 Assets and Liabilities by Pricing Source | ||||||||||||||||||||||||||||||||
Level 3 Assets and Liabilities by Pricing Source: | 31-Mar-15 | |||||||||||||||||||||||||||||||
($ in millions) | Internal [1] | External [2] | Total | |||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [3] | $ | 366.4 | $ | — | $ | 366.4 | ||||||||||||||||||||||||||
State and political subdivision | 208 | 197.4 | 405.4 | |||||||||||||||||||||||||||||
Foreign government | — | 32.4 | 32.4 | |||||||||||||||||||||||||||||
Corporate | 3,351.60 | 1,002.50 | 4,354.10 | |||||||||||||||||||||||||||||
CMBS | — | 35.2 | 35.2 | |||||||||||||||||||||||||||||
RMBS | — | 481.6 | 481.6 | |||||||||||||||||||||||||||||
CDO/CLO | — | 205.5 | 205.5 | |||||||||||||||||||||||||||||
Other ABS | 38 | 170.9 | 208.9 | |||||||||||||||||||||||||||||
Total available-for-sale debt securities | 3,964.00 | 2,125.50 | 6,089.50 | |||||||||||||||||||||||||||||
Available-for-sale equity securities | — | 175.5 | 175.5 | |||||||||||||||||||||||||||||
Short-term investments | — | — | — | |||||||||||||||||||||||||||||
Fair value investments | 6.4 | 198.5 | 204.9 | |||||||||||||||||||||||||||||
Total assets | $ | 3,970.40 | $ | 2,499.50 | $ | 6,469.90 | ||||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||
Embedded derivatives | $ | 175.6 | $ | — | $ | 175.6 | ||||||||||||||||||||||||||
Total liabilities | $ | 175.6 | $ | — | $ | 175.6 | ||||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Represents valuations reflecting both internally-derived and market inputs, as well as third-party information or quotes. | |||||||||||||||||||||||||||||||
[2] | Represents unadjusted prices from independent pricing services, third-party financial statements and independent indicative broker quotes where pricing inputs are not readily available. | |||||||||||||||||||||||||||||||
[3] | Includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
Level 3 Assets and Liabilities by Pricing Source: | 31-Dec-14 | |||||||||||||||||||||||||||||||
($ in millions) | Internal [1] | External [2] | Total | |||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Available-for-sale debt securities | ||||||||||||||||||||||||||||||||
U.S. government and agency [3] | $ | 362.2 | $ | — | $ | 362.2 | ||||||||||||||||||||||||||
State and political subdivision | 159.1 | 241.1 | 400.2 | |||||||||||||||||||||||||||||
Foreign government | — | 53.6 | 53.6 | |||||||||||||||||||||||||||||
Corporate | 3,116.60 | 1,287.30 | 4,403.90 | |||||||||||||||||||||||||||||
CMBS | — | 152.8 | 152.8 | |||||||||||||||||||||||||||||
RMBS | — | 470.3 | 470.3 | |||||||||||||||||||||||||||||
CDO/CLO | — | 196.9 | 196.9 | |||||||||||||||||||||||||||||
Other ABS | 39.3 | 205.8 | 245.1 | |||||||||||||||||||||||||||||
Total available-for-sale debt securities | 3,677.20 | 2,607.80 | 6,285.00 | |||||||||||||||||||||||||||||
Available-for-sale equity securities | — | 179.5 | 179.5 | |||||||||||||||||||||||||||||
Short-term investments | — | — | — | |||||||||||||||||||||||||||||
Fair value investments | 6.3 | 183.7 | 190 | |||||||||||||||||||||||||||||
Total assets | $ | 3,683.50 | $ | 2,971.00 | $ | 6,654.50 | ||||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||
Embedded derivatives | $ | 160.7 | $ | — | $ | 160.7 | ||||||||||||||||||||||||||
Total liabilities | $ | 160.7 | $ | — | $ | 160.7 | ||||||||||||||||||||||||||
——————— | ||||||||||||||||||||||||||||||||
[1] | Represents valuations reflecting both internally-derived and market inputs, as well as third-party information or quotes. | |||||||||||||||||||||||||||||||
[2] | Represents unadjusted prices from independent pricing services, third-party financial statements and independent indicative broker quotes where pricing inputs are not readily available. | |||||||||||||||||||||||||||||||
[3] | Includes securities whose underlying collateral is an obligation of a U.S. government entity. | |||||||||||||||||||||||||||||||
Company's financial instruments where the carrying amounts and fair values differ: | The Company is required by U.S. GAAP to disclose the fair value of certain financial instruments including those that are not carried at fair value. The following table discloses the Company’s financial instruments where the carrying amounts and fair values differ: | |||||||||||||||||||||||||||||||
Carrying Amounts and Fair Values | Fair Value | 31-Mar-15 | 31-Dec-14 | |||||||||||||||||||||||||||||
of Financial Instruments: | Hierarchy | |||||||||||||||||||||||||||||||
($ in millions) | Level | Carrying | Fair | Carrying | Fair | |||||||||||||||||||||||||||
Value | Value | Value | Value | |||||||||||||||||||||||||||||
Financial assets: | ||||||||||||||||||||||||||||||||
Policy loans | Level 3 | $ | 2,363.90 | $ | 2,350.70 | $ | 2,352.10 | $ | 2,339.20 | |||||||||||||||||||||||
Cash and cash equivalents | Level 1 | $ | 347.5 | $ | 347.5 | $ | 450 | $ | 450 | |||||||||||||||||||||||
Life settlements | Level 3 | $ | 22.6 | $ | 17.7 | $ | 22.4 | $ | 17.4 | |||||||||||||||||||||||
Financial liabilities: | ||||||||||||||||||||||||||||||||
Investment contracts | Level 3 | $ | 4,084.60 | $ | 4,087.10 | $ | 3,955.00 | $ | 3,957.30 | |||||||||||||||||||||||
7.15 % Surplus notes | Level 3 | $ | 126.2 | $ | 111.5 | $ | 126.2 | $ | 95.8 | |||||||||||||||||||||||
7.45% Senior unsecured bonds | Level 2 | $ | 252.7 | $ | 250.3 | $ | 252.7 | $ | 248 | |||||||||||||||||||||||
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Income (Tables) | 3 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Equity [Abstract] | ||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes in each component of AOCI attributable to the Company for the periods ended March 31, 2015 and 2014 are as follows below (net of tax): | |||||||||||||||
Accumulated Other Comprehensive Income (Loss) | Net | Net | Net | Total | ||||||||||||
Attributable to The Phoenix Companies, Inc.: | Unrealized | Unrealized | Pension | |||||||||||||
($ in millions) | Gains / (Losses) | Gains / (Losses) | Liability | |||||||||||||
on Investments | on All Other | Adjustments | ||||||||||||||
where | Investments [1] | |||||||||||||||
Credit-related | ||||||||||||||||
OTTI was | ||||||||||||||||
Recognized [1] | ||||||||||||||||
Balance as of December 31, 2013 | $ | 7 | $ | 26.9 | $ | (218.9 | ) | $ | (185.0 | ) | ||||||
Change in component during the period before reclassifications | 6.2 | (9.0 | ) | 0.7 | (2.1 | ) | ||||||||||
Amounts reclassified from AOCI | (3.0 | ) | (3.2 | ) | 1 | (5.2 | ) | |||||||||
Balance as of March 31, 2014 | $ | 10.2 | $ | 14.7 | $ | (217.2 | ) | $ | (192.3 | ) | ||||||
Balance as of December 31, 2014 | $ | 9.9 | $ | 54.8 | $ | (299.1 | ) | $ | (234.4 | ) | ||||||
Change in component during the period before reclassifications | (0.5 | ) | (3.6 | ) | — | (4.1 | ) | |||||||||
Amounts reclassified from AOCI | (1.2 | ) | 1.7 | 1.4 | 1.9 | |||||||||||
Balance as of March 31, 2015 | $ | 8.2 | $ | 52.9 | $ | (297.7 | ) | $ | (236.6 | ) | ||||||
——————— | ||||||||||||||||
[1] | See Note 8 to these consolidated interim unaudited financial statements for additional information regarding offsets to net unrealized investment gains and losses which include policyholder dividend obligation, DAC and other actuarial offsets, and deferred income tax expense (benefit). | |||||||||||||||
Reclassification out of Accumulated Other Comprehensive Income | Reclassifications from AOCI consist of the following: | |||||||||||||||
AOCI | Amounts Reclassified | Affected Line Item in the | ||||||||||||||
from AOCI | Consolidated Statements of Income and | |||||||||||||||
Comprehensive Income | ||||||||||||||||
($ in millions) | Three Months Ended | |||||||||||||||
March 31, | ||||||||||||||||
2015 | 2014 | |||||||||||||||
Net unrealized gains / (losses) on investments where | ||||||||||||||||
credit-related OTTI was recognized: | ||||||||||||||||
Available-for-sale securities | $ | 1.9 | $ | 4.6 | Net realized capital gains (losses) | |||||||||||
1.9 | 4.6 | Total before income taxes | ||||||||||||||
0.7 | 1.6 | Income tax expense (benefit) | ||||||||||||||
$ | 1.2 | $ | 3 | Net income (loss) | ||||||||||||
Net unrealized gains / (losses) on | ||||||||||||||||
all other investments: | ||||||||||||||||
Available-for-sale securities | $ | (2.7 | ) | $ | 4.8 | Net realized capital gains (losses) | ||||||||||
(2.7 | ) | 4.8 | Total before income taxes | |||||||||||||
(1.0 | ) | 1.6 | Income tax expense (benefit) | |||||||||||||
$ | (1.7 | ) | $ | 3.2 | Net income (loss) | |||||||||||
Net pension liability adjustments: | ||||||||||||||||
Amortization of actuarial gains (losses) | $ | (2.4 | ) | $ | (1.9 | ) | Other operating expense | |||||||||
Amortization of prior service costs | 0.3 | 0.3 | Other operating expense | |||||||||||||
(2.1 | ) | (1.6 | ) | Total before income taxes | ||||||||||||
(0.7 | ) | (0.6 | ) | Income tax expense (benefit) | ||||||||||||
$ | (1.4 | ) | $ | (1.0 | ) | Net income (loss) | ||||||||||
Total amounts reclassified from AOCI | $ | (1.9 | ) | $ | 5.2 | Net income (loss) | ||||||||||
Employee_Benefit_Plans_and_Emp1
Employee Benefit Plans and Employment Agreements (Tables) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Compensation and Retirement Disclosure [Abstract] | ||||||||
Components of Pension Benefit Costs | The components of pension and post-employment benefit costs follow: | |||||||
Components of Pension Benefit Costs: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Service cost | $ | 0.8 | $ | 0.6 | ||||
Interest cost | 8.6 | 9.1 | ||||||
Expected return on plan assets | (10.0 | ) | (9.5 | ) | ||||
Net loss amortization | 2.5 | 2 | ||||||
Pension benefit cost | $ | 1.9 | $ | 2.2 | ||||
Components of Other Postretirement Benefit Costs | ||||||||
Components of Other Post-Employment Benefit Costs: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Service cost | $ | — | $ | — | ||||
Interest cost | 0.4 | 0.4 | ||||||
Net gain amortization | (0.1 | ) | (0.1 | ) | ||||
Prior service cost amortization | (0.3 | ) | (0.3 | ) | ||||
Other post-employment benefit cost | $ | — | $ | — | ||||
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 3 Months Ended | |||||
Mar. 31, 2015 | ||||||
Earnings Per Share [Abstract] | ||||||
Shares Used in Calculation of Basic and Diluted | The following table presents a reconciliation of shares used in calculating basic earnings (loss) per common share to those used in calculating diluted earnings (loss) per common share. | |||||
Shares Used in Calculation of Earnings Per Share: | Three Months Ended | |||||
March 31, | ||||||
(shares in thousands) | 2015 | 2014 | ||||
Weighted-average common shares outstanding | 5,751 | 5,742 | ||||
Weighted-average effect of dilutive potential common shares: | ||||||
Restricted stock units | — | 17 | ||||
Employee stock options | — | 2 | ||||
Potential common shares | — | 19 | ||||
Less: Potential common shares excluded from | 19 | |||||
calculation due to net losses | ||||||
Dilutive potential common shares | — | — | ||||
Weighted-average common shares outstanding, | 5,751 | 5,742 | ||||
including dilutive potential common shares | ||||||
Segment_Information_Tables
Segment Information (Tables) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Segment Reporting [Abstract] | ||||||||
Segment Information on Revenues | ||||||||
Segment Information on Revenues: | Three Months Ended | |||||||
March 31, | ||||||||
($ in millions) | 2015 | 2014 | ||||||
Life and Annuity [1] | $ | 399.8 | $ | 394.2 | ||||
Saybrus Partners [2] | 9 | 7.3 | ||||||
Less: Intercompany revenues [3] | 3.4 | 2.5 | ||||||
Total revenues | $ | 405.4 | $ | 399 | ||||
——————— | ||||||||
[1] | Includes intercompany interest revenue of $0 and $0.1 million for the three months ended March 31, 2015 and 2014, respectively. | |||||||
[2] | Includes intercompany commission revenue of $3.4 million and $2.6 million for the three months ended March 31, 2015 and 2014, respectively. | |||||||
[3] | All intercompany balances are eliminated in consolidating the financial statements. | |||||||
Results of Operations by Segment as Reconciled to Consolidated Net Income | ||||||||
Results of Operations by Segment as Reconciled to | Three Months Ended | |||||||
Consolidated Net Income (Loss): | March 31, | |||||||
($ in millions) | 2015 | 2014 | ||||||
Life and Annuity operating income (loss) | $ | (59.4 | ) | $ | (5.8 | ) | ||
Saybrus Partners operating income (loss) | 0.8 | 0.3 | ||||||
Less: Applicable income tax expense (benefit) | (2.2 | ) | (4.8 | ) | ||||
Income (loss) from discontinued operations, net of income taxes | (0.5 | ) | (0.6 | ) | ||||
Net realized gains (losses) | (16.1 | ) | (26.9 | ) | ||||
Less: Net income (loss) attributable to noncontrolling interests | 1 | (0.1 | ) | |||||
Net income (loss) | $ | (74.0 | ) | $ | (28.1 | ) |
Organization_and_Description_o1
Organization and Description of Business (Details) | 3 Months Ended |
Mar. 31, 2015 | |
segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of business segments | 2 |
Revision_of_Previously_Reporte2
Revision of Previously Reported Financial Statements - Statement of Income and Comprehensive Income (Details) (USD $) | 3 Months Ended | |
In Millions, except Share data in Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
REVENUES: | ||
Premiums | $78.40 | $79.60 |
Fee income | 133.8 | 134.8 |
Net investment income | 209.3 | 211.5 |
Net realized gains (losses): | ||
Total other-than-temporary impairment (“OTTIâ€) losses | -7 | 0 |
Portion of OTTI losses recognized in other comprehensive income (“OCIâ€) | -1.4 | -0.2 |
Net OTTI losses recognized in earnings | -8.4 | -0.2 |
Net realized gains (losses), excluding OTTI losses | -7.7 | -26.7 |
Net realized gains (losses) | -16.1 | -26.9 |
Total revenues | 405.4 | 399 |
BENEFITS AND EXPENSES: | ||
Policy benefits | 292 | 230.3 |
Policyholder dividends | 40.1 | 72.2 |
Policy acquisition cost amortization | 17.1 | 24.6 |
Interest expense on indebtedness | 7.1 | 7.1 |
Other operating expenses | 123.8 | 97.2 |
Total benefits and expenses | 480.1 | 431.4 |
Income (loss) from continuing operations before income taxes | -74.7 | -32.4 |
Income tax expense (benefit) | -2.2 | -4.8 |
Income (loss) from continuing operations | -72.5 | -27.6 |
Income (loss) from discontinued operations, net of income taxes | -0.5 | -0.6 |
Net income (loss) | -73 | -28.2 |
Less: Net income (loss) attributable to noncontrolling interests | 1 | -0.1 |
Net income (loss) attributable to The Phoenix Companies, Inc. | -74 | -28.1 |
Other comprehensive income (loss) before income taxes: | ||
Unrealized investment gains (losses), net of related offsets | 3.4 | 23.7 |
Net pension liability adjustment | 1.4 | 1.7 |
Other comprehensive income (loss) before income taxes | 4.8 | 25.4 |
Less: Income tax expense (benefit) related to: | ||
Unrealized investment gains (losses), net of related offsets | 7 | 32.7 |
Net pension liability adjustment | 0 | 0 |
Total income tax expense (benefit) | 7 | 32.7 |
Other comprehensive income (loss) | -2.2 | -7.3 |
Comprehensive income (loss) | -75.2 | -35.5 |
Less: Comprehensive income (loss) attributable to noncontrolling interests | 1 | -0.1 |
Comprehensive income (loss) attributable to The Phoenix Companies, Inc. | -76.2 | -35.4 |
EARNINGS (LOSS) PER SHARE: | ||
Income (loss) from continuing operations – basic (USD per share) | ($12.78) | ($4.79) |
Income (loss) from continuing operations – diluted (USD per share) | ($12.78) | ($4.79) |
Income (loss) from discontinued operations – basic (USD per share) | ($0.09) | ($0.10) |
Income (loss) from discontinued operations – diluted (USD per share) | ($0.09) | ($0.10) |
Net income (loss) attributable to The Phoenix Companies, Inc.– basic (USD per share) | ($12.87) | ($4.89) |
Net income (loss) attributable to The Phoenix Companies, Inc. – diluted (USD per share) | ($12.87) | ($4.89) |
Weighted-average common shares outstanding | 5,751 | 5,742 |
Weighted-average common shares outstanding, including dilutive potential common shares | 5,751 | 5,742 |
As reported | ||
REVENUES: | ||
Premiums | 79.6 | |
Fee income | 134.8 | |
Net investment income | 213.5 | |
Net realized gains (losses): | ||
Total other-than-temporary impairment (“OTTIâ€) losses | 0 | |
Portion of OTTI losses recognized in other comprehensive income (“OCIâ€) | -0.2 | |
Net OTTI losses recognized in earnings | -0.2 | |
Net realized gains (losses), excluding OTTI losses | -25.5 | |
Net realized gains (losses) | -25.7 | |
Total revenues | 402.2 | |
BENEFITS AND EXPENSES: | ||
Policy benefits | 236 | |
Policyholder dividends | 73.8 | |
Policy acquisition cost amortization | 22.4 | |
Interest expense on indebtedness | 7.1 | |
Other operating expenses | 97.9 | |
Total benefits and expenses | 437.2 | |
Income (loss) from continuing operations before income taxes | -35 | |
Income tax expense (benefit) | -3.6 | |
Income (loss) from continuing operations | -31.4 | |
Income (loss) from discontinued operations, net of income taxes | -0.9 | |
Net income (loss) | -32.3 | |
Less: Net income (loss) attributable to noncontrolling interests | 1 | |
Net income (loss) attributable to The Phoenix Companies, Inc. | -33.3 | |
Other comprehensive income (loss) before income taxes: | ||
Unrealized investment gains (losses), net of related offsets | 16.9 | |
Net pension liability adjustment | 1.6 | |
Other comprehensive income (loss) before income taxes | 18.5 | |
Less: Income tax expense (benefit) related to: | ||
Unrealized investment gains (losses), net of related offsets | 28.7 | |
Net pension liability adjustment | 0 | |
Total income tax expense (benefit) | 28.7 | |
Other comprehensive income (loss) | -10.2 | |
Comprehensive income (loss) | -42.5 | |
Less: Comprehensive income (loss) attributable to noncontrolling interests | 1 | |
Comprehensive income (loss) attributable to The Phoenix Companies, Inc. | -43.5 | |
EARNINGS (LOSS) PER SHARE: | ||
Income (loss) from continuing operations – basic (USD per share) | ($5.47) | |
Income (loss) from continuing operations – diluted (USD per share) | ($5.47) | |
Income (loss) from discontinued operations – basic (USD per share) | ($0.16) | |
Income (loss) from discontinued operations – diluted (USD per share) | ($0.16) | |
Net income (loss) attributable to The Phoenix Companies, Inc.– basic (USD per share) | ($5.80) | |
Net income (loss) attributable to The Phoenix Companies, Inc. – diluted (USD per share) | ($5.80) | |
Weighted-average common shares outstanding | 5,742 | |
Weighted-average common shares outstanding, including dilutive potential common shares | 5,742 | |
Correction of errors | ||
BENEFITS AND EXPENSES: | ||
Policy acquisition cost amortization | 2.2 | |
Net income (loss) attributable to The Phoenix Companies, Inc. | 5.2 | |
UL unlock | Correction of errors | ||
REVENUES: | ||
Premiums | 0 | |
Fee income | 0 | |
Net investment income | 0 | |
Net realized gains (losses): | ||
Total other-than-temporary impairment (“OTTIâ€) losses | 0 | |
Portion of OTTI losses recognized in other comprehensive income (“OCIâ€) | 0 | |
Net OTTI losses recognized in earnings | 0 | |
Net realized gains (losses), excluding OTTI losses | 0 | |
Net realized gains (losses) | 0 | |
Total revenues | 0 | |
BENEFITS AND EXPENSES: | ||
Policy benefits | -0.7 | |
Policyholder dividends | 0 | |
Policy acquisition cost amortization | 0 | |
Interest expense on indebtedness | 0 | |
Other operating expenses | 0 | |
Total benefits and expenses | -0.7 | |
Income (loss) from continuing operations before income taxes | 0.7 | |
Income tax expense (benefit) | 0 | |
Income (loss) from continuing operations | 0.7 | |
Income (loss) from discontinued operations, net of income taxes | 0 | |
Net income (loss) | 0.7 | |
Less: Net income (loss) attributable to noncontrolling interests | 0 | |
Net income (loss) attributable to The Phoenix Companies, Inc. | 0.7 | |
Other comprehensive income (loss) before income taxes: | ||
Unrealized investment gains (losses), net of related offsets | 0.8 | |
Net pension liability adjustment | 0 | |
Other comprehensive income (loss) before income taxes | 0.8 | |
Less: Income tax expense (benefit) related to: | ||
Unrealized investment gains (losses), net of related offsets | 0 | |
Net pension liability adjustment | 0 | |
Total income tax expense (benefit) | 0 | |
Other comprehensive income (loss) | 0.8 | |
Comprehensive income (loss) | 1.5 | |
Less: Comprehensive income (loss) attributable to noncontrolling interests | 0 | |
Comprehensive income (loss) attributable to The Phoenix Companies, Inc. | 1.5 | |
EARNINGS (LOSS) PER SHARE: | ||
Income (loss) from continuing operations – basic (USD per share) | $0.12 | |
Income (loss) from continuing operations – diluted (USD per share) | $0.12 | |
Income (loss) from discontinued operations – basic (USD per share) | $0 | |
Income (loss) from discontinued operations – diluted (USD per share) | $0 | |
Net income (loss) attributable to The Phoenix Companies, Inc.– basic (USD per share) | $0.12 | |
Net income (loss) attributable to The Phoenix Companies, Inc. – diluted (USD per share) | $0.12 | |
Other adjustments | Correction of errors | ||
REVENUES: | ||
Premiums | 0 | |
Fee income | 0 | |
Net investment income | -2 | |
Net realized gains (losses): | ||
Total other-than-temporary impairment (“OTTIâ€) losses | 0 | |
Portion of OTTI losses recognized in other comprehensive income (“OCIâ€) | 0 | |
Net OTTI losses recognized in earnings | 0 | |
Net realized gains (losses), excluding OTTI losses | -1.2 | |
Net realized gains (losses) | -1.2 | |
Total revenues | -3.2 | |
BENEFITS AND EXPENSES: | ||
Policy benefits | -5 | |
Policyholder dividends | -1.6 | |
Policy acquisition cost amortization | 2.2 | |
Interest expense on indebtedness | 0 | |
Other operating expenses | -0.7 | |
Total benefits and expenses | -5.1 | |
Income (loss) from continuing operations before income taxes | 1.9 | |
Income tax expense (benefit) | -1.2 | |
Income (loss) from continuing operations | 3.1 | |
Income (loss) from discontinued operations, net of income taxes | 0.3 | |
Net income (loss) | 3.4 | |
Less: Net income (loss) attributable to noncontrolling interests | -1.1 | |
Net income (loss) attributable to The Phoenix Companies, Inc. | 4.5 | |
Other comprehensive income (loss) before income taxes: | ||
Unrealized investment gains (losses), net of related offsets | 6 | |
Net pension liability adjustment | 0.1 | |
Other comprehensive income (loss) before income taxes | 6.1 | |
Less: Income tax expense (benefit) related to: | ||
Unrealized investment gains (losses), net of related offsets | 4 | |
Net pension liability adjustment | 0 | |
Total income tax expense (benefit) | 4 | |
Other comprehensive income (loss) | 2.1 | |
Comprehensive income (loss) | 5.5 | |
Less: Comprehensive income (loss) attributable to noncontrolling interests | -1.1 | |
Comprehensive income (loss) attributable to The Phoenix Companies, Inc. | $6.60 | |
EARNINGS (LOSS) PER SHARE: | ||
Income (loss) from continuing operations – basic (USD per share) | $0.73 | |
Income (loss) from continuing operations – diluted (USD per share) | $0.73 | |
Income (loss) from discontinued operations – basic (USD per share) | $0.05 | |
Income (loss) from discontinued operations – diluted (USD per share) | $0.05 | |
Net income (loss) attributable to The Phoenix Companies, Inc.– basic (USD per share) | $0.78 | |
Net income (loss) attributable to The Phoenix Companies, Inc. – diluted (USD per share) | $0.78 |
Revision_of_Previously_Reporte3
Revision of Previously Reported Financial Statements - Statements of Cash Flows (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
OPERATING ACTIVITIES: | ||
Net income (loss) | ($74) | ($28.10) |
Net realized gains / losses | 13.6 | 26.9 |
Policy acquisition costs deferred | -21.8 | -14.6 |
Policy acquisition cost amortization | 17.1 | 24.6 |
Amortization and depreciation | 1.4 | 1.5 |
Interest credited | 38.2 | 35.6 |
Equity in earnings of limited partnerships and other investments | -13 | -20.1 |
Change in: | ||
Accrued investment income | -49.8 | -44 |
Deferred income taxes, net | -1.5 | -8.3 |
Reinsurance recoverable | -41.3 | -12.9 |
Policy liabilities and accruals | -77.3 | -142.6 |
Dividend obligations | -2.4 | 30.2 |
Pension and post-employment liabilities | -1.7 | -4.9 |
Impact of operating activities of consolidated investment entities, net | -10.8 | -6.7 |
Other operating activities, net | 47.2 | 23.1 |
Cash provided by (used for) operating activities | -176.1 | -140.3 |
Purchases of: | ||
Available-for-sale debt securities | -530.6 | -338.4 |
Available-for-sale equity securities | -7.1 | -1.8 |
Short-term investments | -274.5 | -649.3 |
Derivative instruments | -17.5 | -17.8 |
Fair value and other investments | -0.6 | -0.3 |
Sales, repayments and maturities of: | ||
Available-for-sale debt securities | 393.1 | 338.7 |
Available-for-sale equity securities | 4.7 | 3.1 |
Short-term investments | 269.5 | 489.8 |
Derivative instruments | 19.8 | 42.1 |
Fair value and other investments | 1.9 | 2.8 |
Contributions to limited partnerships and limited liability corporations | -19.5 | -18.2 |
Distributions from limited partnerships and limited liability corporations | 33.4 | 30.3 |
Policy loans, net | 24.4 | 32 |
Impact of investing activities of consolidated investment entities, net | 0 | 0 |
Other investing activities, net | 2.8 | -2 |
Cash provided by (used for) investing activities | -100.2 | -89 |
FINANCING ACTIVITIES: | ||
Policyholder deposits | 373.2 | 361.3 |
Policyholder withdrawals | -295.6 | -321.5 |
Net transfers (to) from separate accounts | 94.6 | 118.2 |
Impact of financing activities of consolidated investment entities, net | 1.2 | 0.1 |
Other financing activities, net | 0 | 0 |
Cash provided by (used for) financing activities | 173.4 | 158.1 |
Change in cash and cash equivalents | -102.9 | -71.2 |
Change in cash included in discontinued operations assets | 0.4 | -0.7 |
Cash and cash equivalents, beginning of period | 450 | 496.4 |
Cash and cash equivalents, end of period | 347.5 | 424.5 |
Supplemental Disclosure of Cash Flow Information | ||
Income taxes (paid) refunded | -6.6 | 0 |
Interest expense on indebtedness paid | -4.7 | -4.7 |
Non-Cash Transactions During the Period | ||
Investment exchanges | 20 | 13 |
As reported | ||
OPERATING ACTIVITIES: | ||
Net income (loss) | -33.3 | |
Net realized gains / losses | 25.7 | |
Policy acquisition costs deferred | -14.4 | |
Policy acquisition cost amortization | 22.4 | |
Amortization and depreciation | 1.5 | |
Interest credited | 35.6 | |
Equity in earnings of limited partnerships and other investments | -23.8 | |
Change in: | ||
Accrued investment income | -43.3 | |
Deferred income taxes, net | -6.1 | |
Reinsurance recoverable | -12.2 | |
Policy liabilities and accruals | -137.6 | |
Dividend obligations | 31.8 | |
Pension and post-employment liabilities | -4.9 | |
Impact of operating activities of consolidated investment entities, net | -5.6 | |
Other operating activities, net | 23.9 | |
Cash provided by (used for) operating activities | -140.3 | |
Purchases of: | ||
Available-for-sale debt securities | -338.5 | |
Available-for-sale equity securities | -1.7 | |
Short-term investments | -649.3 | |
Derivative instruments | -17.8 | |
Fair value and other investments | -0.3 | |
Sales, repayments and maturities of: | ||
Available-for-sale debt securities | 338.8 | |
Available-for-sale equity securities | 3 | |
Short-term investments | 489.8 | |
Derivative instruments | 42.1 | |
Fair value and other investments | 2.8 | |
Contributions to limited partnerships and limited liability corporations | -18.2 | |
Distributions from limited partnerships and limited liability corporations | 30.3 | |
Policy loans, net | 32 | |
Impact of investing activities of consolidated investment entities, net | 0 | |
Other investing activities, net | -2 | |
Cash provided by (used for) investing activities | -89 | |
FINANCING ACTIVITIES: | ||
Policyholder deposits | 361.3 | |
Policyholder withdrawals | -321.5 | |
Net transfers (to) from separate accounts | 118.2 | |
Impact of financing activities of consolidated investment entities, net | 0.1 | |
Other financing activities, net | 0 | |
Cash provided by (used for) financing activities | 158.1 | |
Change in cash and cash equivalents | -71.2 | |
Change in cash included in discontinued operations assets | -0.7 | |
Cash and cash equivalents, beginning of period | 496.4 | |
Cash and cash equivalents, end of period | 424.5 | |
Supplemental Disclosure of Cash Flow Information | ||
Income taxes (paid) refunded | 0 | |
Interest expense on indebtedness paid | -4.7 | |
Non-Cash Transactions During the Period | ||
Investment exchanges | 13 | |
Correction of errors | ||
OPERATING ACTIVITIES: | ||
Net income (loss) | 5.2 | |
Net realized gains / losses | 1.2 | |
Policy acquisition costs deferred | -0.2 | |
Policy acquisition cost amortization | 2.2 | |
Amortization and depreciation | 0 | |
Interest credited | 0 | |
Equity in earnings of limited partnerships and other investments | 3.7 | |
Change in: | ||
Accrued investment income | -0.7 | |
Deferred income taxes, net | -2.2 | |
Reinsurance recoverable | -0.7 | |
Policy liabilities and accruals | -5 | |
Dividend obligations | -1.6 | |
Pension and post-employment liabilities | 0 | |
Impact of operating activities of consolidated investment entities, net | -1.1 | |
Other operating activities, net | -0.8 | |
Cash provided by (used for) operating activities | 0 | |
Purchases of: | ||
Available-for-sale debt securities | 0.1 | |
Available-for-sale equity securities | -0.1 | |
Short-term investments | 0 | |
Derivative instruments | 0 | |
Fair value and other investments | 0 | |
Sales, repayments and maturities of: | ||
Available-for-sale debt securities | -0.1 | |
Available-for-sale equity securities | 0.1 | |
Short-term investments | 0 | |
Derivative instruments | 0 | |
Fair value and other investments | 0 | |
Contributions to limited partnerships and limited liability corporations | 0 | |
Distributions from limited partnerships and limited liability corporations | 0 | |
Policy loans, net | 0 | |
Impact of investing activities of consolidated investment entities, net | 0 | |
Other investing activities, net | 0 | |
Cash provided by (used for) investing activities | 0 | |
FINANCING ACTIVITIES: | ||
Policyholder deposits | 0 | |
Policyholder withdrawals | 0 | |
Net transfers (to) from separate accounts | 0 | |
Impact of financing activities of consolidated investment entities, net | 0 | |
Other financing activities, net | 0 | |
Cash provided by (used for) financing activities | 0 | |
Change in cash and cash equivalents | 0 | |
Change in cash included in discontinued operations assets | 0 | |
Cash and cash equivalents, beginning of period | 0 | |
Cash and cash equivalents, end of period | 0 | |
Supplemental Disclosure of Cash Flow Information | ||
Income taxes (paid) refunded | 0 | |
Interest expense on indebtedness paid | 0 | |
Non-Cash Transactions During the Period | ||
Investment exchanges | $0 |
Revision_of_Previously_Reporte4
Revision of Previously Reported Financial Statements - Stockholders' Equity (Details) (USD $) | 3 Months Ended | |||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 |
Balance, beginning of period | $346.60 | $601.30 | ||
Net income (loss) | -73 | -28.2 | ||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | -74 | -35.4 | ||
Other comprehensive income (loss) | -2.2 | -7.3 | ||
Net income (loss) | -74 | -28.1 | ||
Balance, end of period | 272.6 | 565.9 | ||
As reported | ||||
Balance, beginning of period | 583.7 | |||
Net income (loss) | -32.3 | |||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | -42.4 | |||
Other comprehensive income (loss) | -10.2 | |||
Net income (loss) | -33.3 | |||
Balance, end of period | 541.3 | |||
Correction of errors | ||||
Balance, beginning of period | 17.6 | |||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | 7 | |||
Net income (loss) | 5.2 | |||
Balance, end of period | 24.6 | |||
COMMON STOCK: | ||||
Balance, beginning of period | 0.1 | 0.1 | ||
Balance, end of period | 0.1 | 0.1 | 0.1 | 0.1 |
COMMON STOCK: | As reported | ||||
Balance, beginning of period | 0.1 | |||
Balance, end of period | 0.1 | 0.1 | ||
COMMON STOCK: | Correction of errors | ||||
Balance, beginning of period | 0 | |||
Balance, end of period | 0 | 0 | ||
ADDITIONAL PAID-IN CAPITAL: | ||||
Balance, beginning of period | 2,632.80 | 2,633.10 | ||
Issuance of shares and compensation expense on stock compensation awards | 0 | 0 | ||
Balance, end of period | 2,632.80 | 2,633.10 | ||
ADDITIONAL PAID-IN CAPITAL: | As reported | ||||
Balance, beginning of period | 2,633.10 | |||
Issuance of shares and compensation expense on stock compensation awards | 0 | |||
Balance, end of period | 2,633.10 | |||
ADDITIONAL PAID-IN CAPITAL: | Correction of errors | ||||
Balance, beginning of period | 0 | |||
Issuance of shares and compensation expense on stock compensation awards | 0 | |||
Balance, end of period | 0 | |||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | ||||
Balance, beginning of period | -234.4 | -185 | ||
Other comprehensive income (loss) | -2.2 | -7.3 | ||
Balance, end of period | -236.6 | -192.3 | ||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | As reported | ||||
Balance, beginning of period | -185.2 | |||
Other comprehensive income (loss) | -10.2 | |||
Balance, end of period | -195.4 | |||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | Correction of errors | ||||
Balance, beginning of period | 0.2 | |||
Other comprehensive income (loss) | 2.9 | |||
Balance, end of period | 3.1 | |||
ACCUMULATED DEFICIT: | ||||
Balance, beginning of period | -1,889 | -1,675.80 | ||
Net income (loss) | -74 | -28.1 | ||
Balance, end of period | -1,963 | -1,703.90 | ||
ACCUMULATED DEFICIT: | As reported | ||||
Balance, beginning of period | -1,692.10 | |||
Net income (loss) | -33.3 | |||
Balance, end of period | -1,725.40 | |||
ACCUMULATED DEFICIT: | Correction of errors | ||||
Balance, beginning of period | 16.3 | |||
Net income (loss) | 5.2 | |||
Balance, end of period | 21.5 | |||
TREASURY STOCK, AT COST: | ||||
Balance, beginning of period | -182.9 | -182.9 | ||
Balance, end of period | -182.9 | -182.9 | -182.9 | -182.9 |
TREASURY STOCK, AT COST: | As reported | ||||
Balance, beginning of period | -182.9 | |||
Balance, end of period | -182.9 | -182.9 | ||
TREASURY STOCK, AT COST: | Correction of errors | ||||
Balance, beginning of period | 0 | |||
Balance, end of period | 0 | 0 | ||
Total Stockholders Equity Attributable To The Phoenix Companies, Inc. | ||||
Balance, beginning of period | 589.5 | |||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | -35.4 | |||
Balance, end of period | 554.1 | |||
Total Stockholders Equity Attributable To The Phoenix Companies, Inc. | As reported | ||||
Balance, beginning of period | 573 | |||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | -43.5 | |||
Balance, end of period | 529.5 | |||
Total Stockholders Equity Attributable To The Phoenix Companies, Inc. | Correction of errors | ||||
Balance, beginning of period | 16.5 | |||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | 8.1 | |||
Balance, end of period | 24.6 | |||
NONCONTROLLING INTERESTS: | ||||
Balance, beginning of period | 11.8 | 20 | ||
Net income (loss) | -0.1 | |||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | 0.1 | |||
Balance, end of period | 22.2 | 11.8 | 20 | |
NONCONTROLLING INTERESTS: | As reported | ||||
Balance, beginning of period | 10.7 | |||
Net income (loss) | 1 | |||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | 0.1 | |||
Balance, end of period | 11.8 | |||
NONCONTROLLING INTERESTS: | Correction of errors | ||||
Balance, beginning of period | 1.1 | |||
Net income (loss) | -1.1 | |||
Change in stockholders’ equity attributable to The Phoenix Companies, Inc. | 0 | |||
Balance, end of period | $0 |
Basis_of_Presentation_and_Sign2
Basis of Presentation and Significant Accounting Policies Basis of Presentation and Significant Accounting Policies (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2015 |
Deferred policy acquisition cost, amortization expense, assumption change | $0.20 |
Correction of errors | |
Income related to out of period adjustments | $0 |
Basis_of_Presentation_and_Sign3
Basis of Presentation and Significant Accounting Policies - Holding Company Liquidity (Details) (USD $) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
In Millions, unless otherwise specified | Oct. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 |
Statutory Accounting Practices [Line Items] | ||||||
Liquid assets | $83.10 | $78.30 | $78.30 | |||
Restricted cash and cash equivalents | 10.8 | 10.8 | 10.8 | |||
Interest paid | 4.7 | 4.7 | ||||
Indebtedness | 378.9 | 378.9 | 378.9 | |||
Amount of funds in intercompany tax escrow | 78.9 | 78.9 | ||||
Other operating expenses | 123.8 | 97.2 | ||||
Phoenix Life | ||||||
Statutory Accounting Practices [Line Items] | ||||||
Anticipated dividends paid in next fiscal year | 59.9 | |||||
Dividends | 15 | |||||
Parent Company | ||||||
Statutory Accounting Practices [Line Items] | ||||||
Increase in restricted cash | 10.8 | 10.8 | ||||
Other operating expenses | 10.1 | 40.3 | ||||
PHL Variable | ||||||
Statutory Accounting Practices [Line Items] | ||||||
risk-based capital threshold | 122.00% | 218.00% | 218.00% | |||
Capital contributions to subsidiaries | 15 | 45 | ||||
Corporate | 7.45% Senior Unsecured Bonds | ||||||
Statutory Accounting Practices [Line Items] | ||||||
Interest paid | 5 | 5 | ||||
Indebtedness | $252.70 | |||||
Minimum | PHL Variable | ||||||
Statutory Accounting Practices [Line Items] | ||||||
risk-based capital threshold | 225.00% |
Reinsurance_Narrative_Details
Reinsurance Narrative (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
reinsurance_company | ||
Insurance [Abstract] | ||
Reinsurance recoverable | $600.30 | $559.10 |
Number of major reinsurance companies | 5 | |
Percentage of reinsurance recoverable account by five major reinsurance companies | 65.00% |
Reinsurance_Details
Reinsurance (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Direct Business and Reinsurance in Continuing Operations | ||
Direct premiums | $111 | $115.80 |
Premiums assumed | 1.8 | 1.8 |
Premiums ceded to reinsurers | -34.4 | -38 |
Premiums | 78.4 | 79.6 |
Percentage of amount assumed to net premiums | 2.30% | 2.30% |
Direct policy benefits incurred | 327.3 | 178.5 |
Policy benefits assumed | 1.6 | 12.6 |
Policy benefits ceded | -88.5 | -68.7 |
Premiums paid to reinsurers | 22.6 | 22.3 |
Policy benefits | 263 | 144.7 |
Changes in reserves, interest credited to policyholders, policyholder dividends and other items | $29 | $85.60 |
Demutualization_and_Closed_Blo2
Demutualization and Closed Block Closed Block Assets and Liabilities (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | Jun. 25, 2011 |
In Millions, unless otherwise specified | |||
Closed Block Assets And Liabilities | |||
Available-for-sale debt securities | $5,886.10 | $5,877 | $4,773.10 |
Available-for-sale equity securities | 89 | 91.7 | 0 |
Short-term investments | 9.9 | 0 | 0 |
Limited partnerships and other investments | 347.1 | 343.4 | 399 |
Policy loans | 1,149.70 | 1,159.10 | 1,380 |
Fair value investments | 65.3 | 59.8 | 0 |
Total closed block investments | 7,547.10 | 7,531 | 6,552.10 |
Cash and cash equivalents | 99 | 89.6 | 0 |
Accrued investment income | 80.7 | 80.7 | 106.8 |
Reinsurance recoverable | 36.6 | 19.1 | 0 |
Deferred income taxes, net | 289 | 290.3 | 389.4 |
Other closed block assets | 65.4 | 67.4 | 41.4 |
Total closed block assets | 8,117.80 | 8,078.10 | 7,089.70 |
Policy liabilities and accruals | 8,018 | 8,058.20 | 8,301.70 |
Policyholder dividends payable | 201 | 201.9 | 325.1 |
Policy dividend obligation | 776 | 714.8 | 0 |
Other closed block liabilities | 60.6 | 48 | 12.3 |
Total closed block liabilities | 9,055.60 | 9,022.90 | 8,639.10 |
Excess of closed block liabilities over closed block assets | 937.8 | 944.8 | 1,549.40 |
Less: Excess of closed block assets over closed block liabilities attributable to noncontrolling interests | -12.8 | -11.8 | |
Excess of closed block liabilities over closed block assets attributable to The Phoenix Companies, Inc. | $950.60 | $956.60 |
Demutualization_and_Closed_Blo3
Demutualization and Closed Block Closed Block Revenue and Expenses (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Closed block revenues | ||
Premiums | $70.20 | $72.80 |
Net investment income | 100.2 | 107.3 |
Net realized gains (losses) | -4.6 | 5.3 |
Total revenues | 165.8 | 185.4 |
Policy benefits | 115.5 | 103.8 |
Other operating expenses | 0.1 | 0.2 |
Total benefits and expenses | 115.6 | 104 |
Closed block contribution to income before dividends and income taxes | 50.2 | 81.4 |
Policyholder dividends | -40.1 | -72.2 |
Closed block contribution to income before income taxes | 10.1 | 9.2 |
Applicable income tax expense | 3.5 | 3.2 |
Closed block contribution to income | 6.6 | 6 |
Less: Closed block contribution to income attributable to noncontrolling interests | 0.5 | -0.1 |
Closed block contribution to income attributable to The Phoenix Companies, Inc. | $6.10 | $6.10 |
Demutualization_and_Closed_Blo4
Demutualization and Closed Block Closed Block Policyholder Dividend Obligation (Details) (USD $) | 3 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
Policyholder dividend obligation | ||
Policyholder dividends provided through earnings | $40.10 | $244.60 |
Policyholder dividends provided through OCI | 62.7 | 138.8 |
Additions to (reductions of) policyholder dividend liabilities | 102.8 | 383.4 |
Policyholder dividends paid | -42.5 | -172.2 |
Increase (decrease) in policyholder dividend liabilities | 60.3 | 211.2 |
Policyholder dividend liabilities, beginning of period | 916.7 | 705.5 |
Policyholder dividend liabilities, end of period | 977 | 916.7 |
Policyholder dividends payable, end of period | -201 | -201.9 |
Policyholder dividend obligation, end of period | $776 | $714.80 |
Demutualization_and_Closed_Blo5
Demutualization and Closed Block Narrative (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Insurance [Abstract] | ||
Policyholder dividend obligation for cumulative closed block | $276.70 | $277.90 |
Unrealized gains in investments included in policyholder dividend obligation for cumulative closed block | $499.30 | $436.90 |
Deferred_Policy_Acquisition_Co2
Deferred Policy Acquisition Costs (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Deferred Policy Acquisition Costs: | ||
Balance, beginning of period | $848.60 | $947.80 |
Policy acquisition costs deferred | 21.8 | 14.6 |
Costs amortized to expenses: | ||
Recurring costs | -15.1 | -35.7 |
Assumption unlocking | -6.6 | 0 |
Realized investment gains (losses) | 4.6 | 11.1 |
Offsets to net unrealized investment gains or losses included in AOCI | -16.8 | -30.9 |
Balance, end of period | $836.50 | $906.90 |
Sales_Inducements_Details
Sales Inducements (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Movement in Deferred Sales Inducements [Roll Forward] | ||
Balance, beginning of period | $79.40 | $77.40 |
Sales inducements deferred | 5.3 | 2.1 |
Amortization charged to income | -1.9 | -0.2 |
Offsets to net unrealized investment gains or losses included in AOCI | -3.6 | -3.2 |
Balance, end of period | $79.20 | $76.10 |
Investing_Activities_Fair_Valu
Investing Activities Fair Value and Cost of Securities (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $12,140.10 | $11,978 |
Gross Unrealized Gains | 927.3 | 799.9 |
Gross Unrealized Losses | -82.1 | -98.6 |
Available-for-sale debt securities, at fair value | 12,985.30 | 12,679.30 |
OTTI Recognized in AOCI | -49.6 | -51.8 |
Amortized Cost, amounts applicable to the closed block debt security | 5,396.70 | 5,451.30 |
Gross unrealized gain, amounts applicable to closed block debt security | 515.1 | 458.1 |
Gross unrealized losses, amounts applicable to the closed block debt security | -25.7 | -32.4 |
Fair value, amounts applicable to the closed block debt security | 5,886.10 | 5,877 |
OTTI recognized in AOCI, amounts applicable to the closed block debt security | -14.2 | -14.7 |
Available-for-sale equity securities, Amortized Cost | 154.5 | 156 |
Available-for-sale equity securities, Gross Unrealized Gains | 22.1 | 25.1 |
Available-for-sale equity securities, Gross Unrealized Losses | -1.1 | -1.6 |
Available-for-sale equity securities, at fair value (cost of $154.5 and $156.0) | 175.5 | 179.5 |
Available-for-sale equity securities, OTTI Recognized in AOCI | 0 | 0 |
Amounts applicable to the closed block equity security, Amortized Cost | 79.1 | 80.5 |
Amounts applicable to the closed block equity security, Gross Unrealized Gains | 10.7 | 12.3 |
Amounts applicable to the closed block equity security, Gross Unrealized Losses | -0.8 | -1.1 |
Amounts applicable to the closed block equity security, Fair Value | 89 | 91.7 |
Amounts applicable to the closed block equity security, OTTI Recognized in AOCI | 0 | 0 |
U.S. government and agency | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 384.8 | 388.3 |
Gross Unrealized Gains | 61.9 | 55.2 |
Gross Unrealized Losses | 0 | -0.1 |
Available-for-sale debt securities, at fair value | 446.7 | 443.4 |
OTTI Recognized in AOCI | 0 | 0 |
State and political subdivision | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 531.5 | 518.3 |
Gross Unrealized Gains | 51.5 | 42.1 |
Gross Unrealized Losses | -2.5 | -2.5 |
Available-for-sale debt securities, at fair value | 580.5 | 557.9 |
OTTI Recognized in AOCI | -1.1 | -1.1 |
Foreign government | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 218.6 | 205.8 |
Gross Unrealized Gains | 29.9 | 26.5 |
Gross Unrealized Losses | -0.5 | -1.4 |
Available-for-sale debt securities, at fair value | 248 | 230.9 |
OTTI Recognized in AOCI | 0 | 0 |
Corporate | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 8,148.70 | 7,942.70 |
Gross Unrealized Gains | 626.1 | 530 |
Gross Unrealized Losses | -62.7 | -74.6 |
Available-for-sale debt securities, at fair value | 8,712.10 | 8,398.10 |
OTTI Recognized in AOCI | -7 | -8.3 |
Commercial mortgage-backed (“CMBSâ€) | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 597.1 | 602.9 |
Gross Unrealized Gains | 53.8 | 48.4 |
Gross Unrealized Losses | 0 | -0.1 |
Available-for-sale debt securities, at fair value | 650.9 | 651.2 |
OTTI Recognized in AOCI | -1.2 | -1.2 |
Residential mortgage-backed (“RMBSâ€) | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 1,794 | 1,862.50 |
Gross Unrealized Gains | 86.6 | 81.6 |
Gross Unrealized Losses | -9.7 | -11.9 |
Available-for-sale debt securities, at fair value | 1,870.90 | 1,932.20 |
OTTI Recognized in AOCI | -25.4 | -25.5 |
Collateralized debt obligations (“CDOâ€) / collateralized loan obligations (“CLOâ€) | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 204.1 | 197.5 |
Gross Unrealized Gains | 3.6 | 2.7 |
Gross Unrealized Losses | -2.2 | -3.3 |
Available-for-sale debt securities, at fair value | 205.5 | 196.9 |
OTTI Recognized in AOCI | -13.1 | -13.9 |
Other asset-backed (“ABSâ€) | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 261.3 | 260 |
Gross Unrealized Gains | 13.9 | 13.4 |
Gross Unrealized Losses | -4.5 | -4.7 |
Available-for-sale debt securities, at fair value | 270.7 | 268.7 |
OTTI Recognized in AOCI | ($1.80) | ($1.80) |
Investing_Activities_Maturitie
Investing Activities Maturities of Debt Securities (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Available-for-sale Securities, Debt Maturities, Amortized Cost Basis, Fiscal Year Maturity [Abstract] | ||
Due in one year or less | $310.20 | |
Due after one year through five years | 2,007 | |
Due after five years through ten years | 3,513.30 | |
Due after ten years | 3,453.10 | |
CMBS/RMBS/ABS/CDO/CLO | 2,856.50 | |
Amortized Cost | 12,140.10 | 11,978 |
Available-for-sale Securities, Debt Maturities, Fair Value, Fiscal Year Maturity [Abstract] | ||
Due in one year or less | 313.8 | |
Due after one year through five years | 2,139.80 | |
Due after five years through ten years | 3,711.80 | |
Due after ten years | 3,821.90 | |
CMBS/RMBS/ABS/CDO/CLO | 2,998 | |
Fair Value | $12,985.30 | $12,679.30 |
Investing_Activities_Sales_of_
Investing Activities Sales of Available-for-Sale Securities (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Debt securities, available-for-sale | ||
Proceeds from sales | $155.60 | $48.40 |
Proceeds from maturities/repayments | 243.9 | 289.3 |
Gross investment gains from sales, prepayments and maturities | 8.5 | 11.5 |
Gross investment losses from sales and maturities | -0.9 | -3.8 |
Equity securities, available-for-sale | ||
Proceeds from sales | 1.7 | 4.2 |
Gross investment gains from sales | 0 | 1.9 |
Gross investment losses from sales | $0 | $0 |
Investing_Activities_Aging_of_
Investing Activities Aging of Temporary Impaired Securities (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | security | security |
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | $536.20 | $768.60 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | 23.3 | 27 |
Available-for-sale securities, continuous unrealized loss position,, twelve months or longer, fair value | 792.6 | 1,053.20 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 59.9 | 73.2 |
Available-for-sale securities, continuous unrealized loss position, fair value | 1,328.80 | 1,821.80 |
U.S. government and agency | 83.2 | 100.2 |
Available-for-sale securities, continuous unrealized loss position, amounts inside closed block, less than twelve months, fair value | 182.2 | 266.8 |
Available-for-sale securities, continuous unrealized loss position, amounts inside closed block, less than 12 months, accumulated loss | 11 | 11.7 |
Available-for-sale securities, continuous unrealized loss position, mounts inside closed block, twelve months or longer, fair value | 298.2 | 387.8 |
Available-for-sale securities, continuous unrealized loss position, amounts inside closed block, 12 months or longer, accumulated loss | 15.5 | 21.8 |
Available-for-sale securities, continuous unrealized loss position, amount inside closed block, fair value, total | 480.4 | 654.6 |
Amounts inside the closed block | 26.5 | 33.5 |
Available-for-sale securities, continuous unrealized loss position, amounts outside closed block, less than twelve months, fair value | 354 | 501.8 |
Available-for-sale securities, continuous unrealized loss position, amounts outside closed block, less than 12 months, accumulated loss | 12.3 | 15.3 |
Available-for-sale securities, continuous unrealized loss position, amounts outside closed block, twelve months or longer, fair value | 494.4 | 665.4 |
Available-for-sale securities, continuous unrealized loss position, amounts outside closed block, 12 months or longer, accumulated loss | 44.4 | 51.4 |
Available-for-sale securities, continuous unrealized loss position, amount outside closed block, fair value, total | 848.4 | 1,167.20 |
Amounts outside the closed block | 56.7 | 66.7 |
Available-for-sale securities, continuous unrealized loss position, amounts outside closed block, below investment grade, less than twelve months, fair value | 84.2 | 84.2 |
Available-for-sale securities, continuous unrealized loss position, amounts outside closed block, below investment grade, less than 12 months, accumulated loss | 5 | 4.1 |
Available-for-sale securities, continuous unrealized loss position, amounts outside closed block, below investment grade, twelve months or longer, fair value | 60.7 | 50.4 |
Available-for-sale securities, continuous unrealized loss position, amounts outside closed block, below investment Grade, 12 months or longer, accumulated loss | 7.7 | 6.6 |
Available-for-sale securities, continuous unrealized loss position, amount outside closed block, below investment grade, fair value, total | 144.9 | 134.6 |
Amounts outside the closed block that are below investment grade | 12.7 | 10.7 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, number of securities | 118 | 158 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, number of securities | 156 | 211 |
Number of securities | 274 | 369 |
U.S. government and agency | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 0 | 0 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | 0 | 0 |
Available-for-sale securities, continuous unrealized loss position,, twelve months or longer, fair value | 1.7 | 2.7 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 0 | 0.1 |
Available-for-sale securities, continuous unrealized loss position, fair value | 1.7 | 2.7 |
U.S. government and agency | 0 | 0.1 |
State and political subdivision | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 11.3 | 11.6 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | 0.6 | 0.6 |
Available-for-sale securities, continuous unrealized loss position,, twelve months or longer, fair value | 28 | 31.1 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 1.9 | 1.9 |
Available-for-sale securities, continuous unrealized loss position, fair value | 39.3 | 42.7 |
U.S. government and agency | 2.5 | 2.5 |
Foreign government | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 11.5 | 15.7 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | 0.5 | 1.4 |
Available-for-sale securities, continuous unrealized loss position,, twelve months or longer, fair value | 0 | 0 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 0 | 0 |
Available-for-sale securities, continuous unrealized loss position, fair value | 11.5 | 15.7 |
U.S. government and agency | 0.5 | 1.4 |
Corporate | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 443.3 | 643 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | 21 | 23.5 |
Available-for-sale securities, continuous unrealized loss position,, twelve months or longer, fair value | 439.4 | 654.3 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 41.7 | 51.1 |
Available-for-sale securities, continuous unrealized loss position, fair value | 882.7 | 1,297.30 |
U.S. government and agency | 62.7 | 74.6 |
Commercial mortgage-backed (“CMBSâ€) | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 3.5 | 12.6 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | 0 | 0 |
Available-for-sale securities, continuous unrealized loss position,, twelve months or longer, fair value | 0 | 10.9 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 0 | 0.1 |
Available-for-sale securities, continuous unrealized loss position, fair value | 3.5 | 23.5 |
U.S. government and agency | 0 | 0.1 |
Residential mortgage-backed (“RMBSâ€) | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 28.5 | 8.4 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | 0.1 | 0.2 |
Available-for-sale securities, continuous unrealized loss position,, twelve months or longer, fair value | 205.6 | 226.7 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 9.6 | 11.7 |
Available-for-sale securities, continuous unrealized loss position, fair value | 234.1 | 235.1 |
U.S. government and agency | 9.7 | 11.9 |
Collateralized debt obligations (“CDOâ€) / collateralized loan obligations (“CLOâ€) | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 27.2 | 57.9 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | 0.2 | 0.5 |
Available-for-sale securities, continuous unrealized loss position,, twelve months or longer, fair value | 86.7 | 96.3 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 2 | 2.8 |
Available-for-sale securities, continuous unrealized loss position, fair value | 113.9 | 154.2 |
U.S. government and agency | 2.2 | 3.3 |
Other asset-backed (“ABSâ€) | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 3.2 | 13.8 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | 0 | 0.1 |
Available-for-sale securities, continuous unrealized loss position,, twelve months or longer, fair value | 15.3 | 16 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 4.5 | 4.6 |
Available-for-sale securities, continuous unrealized loss position, fair value | 18.5 | 29.8 |
U.S. government and agency | 4.5 | 4.7 |
Debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 528.5 | 763 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | 22.4 | 26.3 |
Available-for-sale securities, continuous unrealized loss position,, twelve months or longer, fair value | 776.7 | 1,038 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 59.7 | 72.3 |
Available-for-sale securities, continuous unrealized loss position, fair value | 1,305.20 | 1,801 |
U.S. government and agency | 82.1 | 98.6 |
Equity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 7.7 | 5.6 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | 0.9 | 0.7 |
Available-for-sale securities, continuous unrealized loss position,, twelve months or longer, fair value | 15.9 | 15.2 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 0.2 | 0.9 |
Available-for-sale securities, continuous unrealized loss position, fair value | 23.6 | 20.8 |
U.S. government and agency | $1.10 | $1.60 |
Investing_Activities_Debt_Equi
Investing Activities Debt & Equity Securities Narrative (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2015 |
security | |
Investments, Debt and Equity Securities [Abstract] | |
Unrealized losses on debt securities outside closed block depressed of amortized cost, percentage | 20.00% |
Unrealized losses on debt securities outside closed block depressed of amortized cost, amount | $3.40 |
Unrealized losses on debt securities held in closed block depressed of amortized cost, amount | 0.3 |
Unrealized losses on debt securities outside closed block depressed of amortized cost for more than 12 month, amount | 2.1 |
Unrealized losses on below-investment-grade debt securities depressed of amortized cost for more than 12 month, amount | $0 |
Unrealized losses on debt securities outside closed block depressed of amortized cost for more than 12 month, percentage | 20.00% |
Number of debt securities | 147 |
Number of equity securities | 9 |
Investing_Activities_Otherthan
Investing Activities Other-than-temporary impairments Narrative (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Investments, Debt and Equity Securities [Abstract] | ||
Impairment losses | $8.40 | $0.20 |
Debt impairment | 1.5 | 0 |
Equity impairment | $6.90 | $0.20 |
Investing_Activities_Credit_Lo
Investing Activities Credit Losses Recognized in Earnings on Debt Securities for which a Portion of the OTTI Loss was Recognized in OCI (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Credit Losses Recognized in Earnings on Debt Securities for which a Portion of the OTTI Loss was Recognized in OCI: ($ in millions) | ||
Balance, beginning of period | ($52.40) | ($71.40) |
Add: Credit losses on securities not previously impaired | 0 | 0 |
Add: Credit losses on securities previously impaired | 0 | 0 |
Less: Credit losses on securities impaired due to intent to sell | 0 | 0 |
Less: Credit losses on securities sold | 3.2 | 8.3 |
Less: Increases in cash flows expected on previously impaired securities | 0 | 0 |
Balance, end of period | ($49.20) | ($63.10) |
Investing_Activities_Limited_P
Investing Activities Limited Partnerships and other investments (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Investments, Debt and Equity Securities [Abstract] | ||
Private equity funds | $249.70 | $241.10 |
Mezzanine funds | 165.1 | 162.4 |
Infrastructure funds | 38.4 | 38.9 |
Hedge funds | 11 | 10.7 |
Mortgage and real estate funds | 4.2 | 3.7 |
Leveraged leases | 10.3 | 11.8 |
Direct equity investments | 38.2 | 49.6 |
Life settlements | 22.6 | 22.4 |
Other alternative assets | 2.2 | 2.2 |
Limited partnerships and other investments | 541.7 | 542.8 |
Amounts applicable to the closed block | $347.10 | $343.40 |
Investing_Activities_Sources_o
Investing Activities Sources of Net Investment Income (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Investments, Debt and Equity Securities [Abstract] | ||
Debt securities | $148.80 | $143.80 |
Equity securities | 1.9 | 2.1 |
Limited partnerships and other investments | 13.2 | 26.5 |
Policy loans | 41.7 | 41.2 |
Fair value investments | 11.1 | 2.1 |
Total investment income | 216.7 | 215.7 |
Less: Discontinued operations | 0.3 | 0.3 |
Less: Investment expenses | 7.1 | 3.9 |
Net investment income | 209.3 | 211.5 |
Amounts applicable to the closed block | $100.20 | $107.30 |
Investing_Activities_Sources_a
Investing Activities Sources and Types of Net Realized Investment Gains (Losses) (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Investments, Debt and Equity Securities [Abstract] | ||
Total other-than-temporary debt impairments | ($0.10) | $0.20 |
Portion of losses recognized in OCI | -1.4 | -0.2 |
Net debt impairments recognized in earnings | -1.5 | 0 |
Debt security impairments: | ||
U.S. government and agency | 0 | 0 |
State and political subdivision | 0 | 0 |
Foreign government | 0 | 0 |
Corporate | -1.3 | |
CMBS | 0 | 0 |
RMBS | -0.2 | 0 |
CDO/CLO | 0 | 0 |
Other ABS | 0 | 0 |
Net debt security impairments | -1.5 | 0 |
Equity security impairments | -6.9 | -0.2 |
Limited partnerships and other investment impairments | 0 | 0 |
Impairment losses | 8.4 | 0.2 |
Debt security transaction gains | 8.5 | 11.6 |
Debt security transaction losses | -0.9 | -3.9 |
Equity security transaction gains | 0 | 1.9 |
Equity security transaction losses | 0 | 0 |
Limited partnerships and other investment transaction gains | 0 | 0 |
Limited partnerships and other investment transaction losses | 0 | 0 |
Net transaction gains (losses) | 7.6 | 9.6 |
Derivative instruments | -2.3 | -23.8 |
Embedded derivatives | -10.3 | -12.9 |
Assets valued at fair value | -2.7 | 0.4 |
Net realized gains (losses), excluding impairment losses | -7.7 | -26.7 |
Net realized gains (losses), including impairment losses | ($16.10) | ($26.90) |
Investing_Activities_Sources_o1
Investing Activities Sources of Changes in Net Unrealized Investment Gains (Losses) (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Investments, Debt and Equity Securities [Abstract] | ||
Debt securities | $143.90 | $166 |
Equity securities | -2.5 | 2.1 |
Other investments | -0.2 | 0.4 |
Net unrealized investment gains (losses) | 141.2 | 168.5 |
Applicable to closed block policyholder dividend obligation | 62.7 | 81.6 |
Applicable to DAC | 16.8 | 30.9 |
Applicable to other actuarial offsets | 58.3 | 32.3 |
Applicable to deferred income tax expense (benefit) | 7 | 32.7 |
Offsets to net unrealized investment gains (losses) | 144.8 | 177.5 |
Net unrealized gains (losses) included in OCI | ($3.60) | ($9) |
Investing_Activities_Carrying_
Investing Activities Carrying Value of Assets and Liabilities for Consolidated Variable Interest Entities (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Variable Interest Entity [Line Items] | ||
Unfunded commitments related to VIEs | $9.90 | $11.90 |
Liabilities | ||
Variable Interest Entity [Line Items] | ||
Debt securities, at fair value | 0 | 0 |
Equity securities, at fair value | 0 | 0 |
Cash and cash equivalents | 0 | 0 |
Investment in partnership interests | 0 | 0 |
Investment in single asset LLCs | 0 | 0 |
Other assets | 0 | 0 |
Total assets of consolidated VIEs | 0 | 0 |
Total liabilities of consolidated VIEs | 0.7 | 0.6 |
Maximum Exposure of Loss | ||
Variable Interest Entity [Line Items] | ||
Debt securities, at fair value | 8.8 | 5.1 |
Equity securities, at fair value | 32.6 | 30 |
Cash and cash equivalents | 9.8 | 9.3 |
Investment in partnership interests | 1.7 | 0 |
Investment in single asset LLCs | 38.8 | 36.6 |
Other assets | 0.6 | 0.5 |
Total assets of consolidated VIEs | 92.3 | 81.5 |
Total liabilities of consolidated VIEs | 0.5 | 0.5 |
Assets | ||
Variable Interest Entity [Line Items] | ||
Debt securities, at fair value | 12.9 | 5.5 |
Equity securities, at fair value | 37.5 | 35 |
Cash and cash equivalents | 10.1 | 9.4 |
Investment in partnership interests | 2.1 | 0 |
Investment in single asset LLCs | 50.6 | 50.6 |
Other assets | 0.7 | 0.6 |
Total assets of consolidated VIEs | 113.9 | 101.1 |
Total liabilities of consolidated VIEs | $0 | $0 |
Investing_Activities_Carrying_1
Investing Activities Carrying Value of Assets and Liabilities and Maximum Exposure Loss Relating to Variable Interest Entities (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Liabilities | ||
Variable Interest Entity [Line Items] | ||
Total | $0 | $0 |
Liabilities | Limited Partnerships | ||
Variable Interest Entity [Line Items] | ||
Total | 0 | 0 |
Liabilities | LLCs | ||
Variable Interest Entity [Line Items] | ||
Total | 0 | 0 |
Maximum Exposure of Loss | ||
Variable Interest Entity [Line Items] | ||
Total | 225.9 | 203.3 |
Maximum Exposure of Loss | Limited Partnerships | ||
Variable Interest Entity [Line Items] | ||
Total | 190.5 | 157.8 |
Maximum Exposure of Loss | LLCs | ||
Variable Interest Entity [Line Items] | ||
Total | 35.4 | 45.5 |
Assets | ||
Variable Interest Entity [Line Items] | ||
Total | 152.3 | 151.5 |
Assets | Limited Partnerships | ||
Variable Interest Entity [Line Items] | ||
Total | 116.9 | 106 |
Assets | LLCs | ||
Variable Interest Entity [Line Items] | ||
Total | $35.40 | $45.50 |
Investing_Activities_Issuer_an
Investing Activities Issuer and Counterparty Credit Exposure (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
issuer | ||
counterparty | ||
Investments, Debt and Equity Securities [Abstract] | ||
Fixed maturities below-investment-grade assets | $920.80 | $848.80 |
Number of issuers (in issuers) | 36 | |
Derivative assets, net of liabilities | 63.1 | |
Number of counterparties | 11 | |
Debt securities, fair value | 295.7 | |
Maximum amount of loss due to credit risk | $358.80 |
Financing_Activities_Schedule_
Financing Activities Schedule of Long-term Debt Instruments (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Debt Disclosure [Abstract] | ||
7.15% surplus notes | $126.20 | $126.20 |
7.45% senior unsecured bonds | 252.7 | 252.7 |
Total indebtedness | $378.90 | $378.90 |
Financing_Activities_Narrative
Financing Activities Narrative (Details) (USD $) | 1 Months Ended | 3 Months Ended | ||
Dec. 31, 2001 | Mar. 31, 2015 | Sep. 21, 2012 | Dec. 31, 2014 | |
Debt Instrument [Line Items] | ||||
Future minimum annual payments on indebtedness in 2032 | $252,700,000 | |||
Future minimum annual payments on debt in 2034 | 126,700,000 | |||
Cumulative amount of bonds repurchased | 47,300,000 | |||
7.15 % Surplus notes | 7.15% Surplus Notes | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 7.15% | |||
Unamortized discount | 500,000 | 200,000 | ||
Cumulative amount of bonds repurchased | 36,200,000 | |||
Repurchased face amount | 48,300,000 | |||
Corporate | 7.45% Senior Unsecured Bonds | ||||
Debt Instrument [Line Items] | ||||
Proceeds from issuance of debt | 300,000,000 | |||
Proceeds from issuance of debt, net | 290,600,000 | |||
Bonds | 7.45% Senior Unsecured Bonds | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 7.45% | |||
Redemption price percentage | 100.00% | |||
Repurchased face amount | $0 | $0 | ||
Period to file reports with trustee | 15 days |
Financing_Activities_Interest_
Financing Activities Interest Expense on Indebtedness, including Amortization of Debt Issuance Costs (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Debt Disclosure [Abstract] | ||
7.15% surplus notes | $2.30 | $2.30 |
7.45% senior unsecured bonds | 4.8 | 4.8 |
Interest expense on indebtedness | $7.10 | $7.10 |
Common_Stock_and_Stock_Repurch1
Common Stock and Stock Repurchase Program Narrative (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Millions, except Share data, unless otherwise specified | ||
Class of Stock [Line Items] | ||
Shares authorized (in shares) | 50,000,000 | |
Shares issued (in shares) | 6,400,000 | |
Shares issued to policyholders in exchange for their interests (in shares) | 2,800,000 | |
Shares issue to settle share-based compensation awards (in shares) | 3,600,000 | |
Shares held in employee trust (in shares) | 100,000 | |
Common shares reserved (in shares) | 400,000 | |
Maximum amount the Company is authorized to repurchase | $25 | |
Ownership percentage by noncontrolling interest | 5.20% | |
Compensation costs | $0.70 | $0.60 |
Stock Options | ||
Class of Stock [Line Items] | ||
Common shares reserved (in shares) | 300,000 | |
Restricted Stock Units (RSUs) | ||
Class of Stock [Line Items] | ||
Common shares reserved (in shares) | 100,000 |
Separate_Accounts_Death_Benefi2
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives Separate Account Investments of Account Balances of Variable Annuity Contracts with Guarantees (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives [Abstract] | ||
Debt securities | $361.90 | $375.90 |
Equity funds | 1,598.70 | 1,638.60 |
Other | 48.7 | 49.9 |
Total | $2,009.30 | $2,064.40 |
Separate_Accounts_Death_Benefi3
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives Changes in Guaranteed Liability Balances (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Variable Annuity GMDB | ||
Movement in Guaranteed Benefit Liability, Gross [Roll Forward] | ||
Liability balance, beginning of the period | $21.40 | $22.70 |
Incurred | -0.6 | -0.1 |
Paid | -0.6 | -0.6 |
Assumption unlocking | 0.4 | 0 |
Change due to net unrealized gains or losses included in AOCI | 0.1 | 0.1 |
Liability balance, end of the period | 20.7 | 22.1 |
Variable Annuity GMIB | ||
Movement in Guaranteed Benefit Liability, Gross [Roll Forward] | ||
Liability balance, beginning of the period | 17.1 | 9.8 |
Incurred | -2.5 | -0.1 |
Paid | 0 | 0 |
Assumption unlocking | 0 | 0 |
Change due to net unrealized gains or losses included in AOCI | 0 | -0.1 |
Liability balance, end of the period | 14.6 | 9.6 |
Fixed Indexed Annuity GMWB & GMDB | ||
Movement in Guaranteed Benefit Liability, Gross [Roll Forward] | ||
Liability balance, beginning of the period | 147 | 85.4 |
Incurred | -10.5 | -0.3 |
Paid | -0.1 | -0.1 |
Assumption unlocking | 0 | 0 |
Change due to net unrealized gains or losses included in AOCI | 13.9 | 18.5 |
Liability balance, end of the period | 171.3 | 104.1 |
Universal Life | ||
Movement in Guaranteed Benefit Liability, Gross [Roll Forward] | ||
Liability balance, beginning of the period | 195.8 | 170.6 |
Incurred | -10.1 | -8.4 |
Paid | -6.4 | -1.9 |
Assumption unlocking | 0 | 0 |
Change due to net unrealized gains or losses included in AOCI | 1.4 | 0.9 |
Liability balance, end of the period | $200.90 | $178 |
Separate_Accounts_Death_Benefi4
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives Variable Annuity GMDB Benefits by Type (Details) (USD $) | 3 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account Value | $2,375.20 | $2,436.50 |
NAR before Reinsurance | 111 | 118.6 |
NAR after Reinsurance | 16.7 | 19.8 |
Average Attained Age of Annuitant | 65 years | 65 years |
Less: General account value with GMDB | 372.3 | 378.6 |
Subtotal separate account liabilities with GMDB | 2,002.90 | 2,057.90 |
Separate account liabilities without GMDB | 966.5 | 962.8 |
Total separate account liabilities | 2,969.40 | 3,020.70 |
GMIB at end of period | 308.3 | 319.6 |
GMDB return of premium | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account Value | 638 | 661.5 |
NAR before Reinsurance | 1.4 | 1.6 |
NAR after Reinsurance | 1.4 | 1.6 |
Average Attained Age of Annuitant | 64 years | 63 years |
GMDB step up | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account Value | 1,685.70 | 1,723.20 |
NAR before Reinsurance | 104.8 | 112.2 |
NAR after Reinsurance | 10.5 | 13.4 |
Average Attained Age of Annuitant | 64 years | 64 years |
GMDB earnings enhancement benefit (EEB) | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account Value | 29.1 | 29.1 |
NAR before Reinsurance | 0 | 0 |
NAR after Reinsurance | 0 | 0 |
Average Attained Age of Annuitant | 65 years | 65 years |
GMDB greater of annual step up and roll up | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account Value | 22.4 | 22.7 |
NAR before Reinsurance | 4.8 | 4.8 |
NAR after Reinsurance | $4.80 | $4.80 |
Average Attained Age of Annuitant | 69 years | 69 years |
Separate_Accounts_Death_Benefi5
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives Changes in Additional Liability Balances (Details) (Universal Life, USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Universal Life | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Balance, beginning of period | $351.50 | $249.10 |
Incurred | 16.7 | 16.1 |
Assumption unlocking | -6.8 | 0 |
Change due to net unrealized gains or losses included in AOCI | 26.3 | 14.7 |
Balance, end of period | $387.70 | $279.90 |
Separate_Accounts_Death_Benefi6
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives Non-Insurance Guaranteed Product Features (Details) (USD $) | 3 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account Value | $783.70 | $819.50 |
Average Attained Age of Annuitant | 65 years | 65 years |
GMWB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account Value | 477.7 | 496.8 |
Average Attained Age of Annuitant | 65 years | 65 years |
GMAB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account Value | 300.6 | 315.6 |
Average Attained Age of Annuitant | 59 years | 59 years |
COMBO | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account Value | $5.40 | $7.10 |
Average Attained Age of Annuitant | 64 years | 65 years |
Separate_Accounts_Death_Benefi7
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives Variable Annuity Embedded Derivative Liabilities (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Separate Accounts Death Benefits Other Insurance Benefit Features And Embedded Product Derivatives Details 4 | ||
GMWB | $9.50 | $7.30 |
GMAB | -0.7 | -0.3 |
COMBO | -0.1 | -0.2 |
Total variable annuity embedded derivative liabilities | $8.70 | $6.80 |
Separate_Accounts_Death_Benefi8
Separate Accounts Death Benefits, Other Insurance Benefit Features and Embedded Product Derivatives Narrative (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Separate Accounts, Death Benefits and Other Insurance Benefit Features and Embedded Product Derivatives [Abstract] | |||
Assets supporting fixed indexed annuities | $2,700,000,000 | $2,600,000,000 | |
Fair value embedded derivatives | 166,900,000 | 153,900,000 | |
Embedded derivatives gains and (losses) recognized in earnings | ($10,300,000) | ($12,900,000) |
Derivative_Instruments_Narrati
Derivative Instruments Narrative (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Cash and cash equivalents held at collateral by a third party related to derivative transactions | $22.60 | $18.60 |
Derivative_Instruments_Details
Derivative Instruments (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Derivative [Line Items] | ||
Fair Value Assets | $140.20 | $161.30 |
Fair Value Liabilities | 77.1 | 85.6 |
Derivative liabilities contingent receivable | 1.4 | 1.5 |
Total derivative instruments [Member] | ||
Derivative [Line Items] | ||
Notional Amount | 3,031.30 | 3,617.70 |
Fair Value Assets | 140.2 | 161.3 |
Fair Value Liabilities | 77.1 | 85.6 |
Interest rate swaps | ||
Derivative [Line Items] | ||
Notional Amount | 149 | 114 |
Fair Value Assets | 4 | 9.7 |
Fair Value Liabilities | 0.4 | 1.9 |
Variance swaps | ||
Derivative [Line Items] | ||
Notional Amount | 0.9 | 0.9 |
Fair Value Assets | 0 | 0 |
Fair Value Liabilities | 9 | 8.6 |
Swaptions | ||
Derivative [Line Items] | ||
Notional Amount | 777 | |
Fair Value Assets | 0.1 | |
Fair Value Liabilities | 0 | |
Put options | ||
Derivative [Line Items] | ||
Notional Amount | 692.5 | 692.5 |
Fair Value Assets | 26.8 | 31.1 |
Fair Value Liabilities | 0 | 0 |
Call options | ||
Derivative [Line Items] | ||
Notional Amount | 2,169.30 | 2,019.20 |
Fair Value Assets | 107.7 | 119.8 |
Fair Value Liabilities | 67.7 | 74.6 |
Cross currency swaps | ||
Derivative [Line Items] | ||
Notional Amount | 10 | 10 |
Fair Value Assets | 1.7 | 0.6 |
Fair Value Liabilities | 0 | 0 |
Equity futures | ||
Derivative [Line Items] | ||
Notional Amount | 9.6 | 4.1 |
Fair Value Assets | 0 | 0 |
Fair Value Liabilities | $0 | $0.50 |
Derivative_Instruments_Derivat
Derivative Instruments Derivative Instrument Gains (Losses) Recognized in Earnings (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Interest rate swaps | $2.70 | $5 |
Variance swaps | -0.4 | -0.6 |
Swaptions | -0.1 | -18.3 |
Put options | -4.2 | -4.2 |
Call options | -1.5 | -3 |
Cross currency swaps | 1 | -0.1 |
Equity futures | 0.2 | -2.6 |
Embedded derivatives | 10.3 | 12.9 |
Total derivative instrument gains (losses) recognized in realized investment gains (losses) | ($12.60) | ($36.70) |
Derivative_Instruments_Derivat1
Derivative Instruments Derivative Instruments Offsetting Assets and Liabilities (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Derivative Asset [Abstract] | ||
Gross amounts recognized | $140.20 | $161.30 |
Gross amounts offset in the balance sheet | 0 | 0 |
Net amount presented in the balance sheet | 140.2 | 161.3 |
Derivative, collateral, obligation to return securities | -73.4 | -82.5 |
Net amount | 66.8 | 78.8 |
Offsetting Derivative Liabilities [Abstract] | ||
Gross amounts recognized | -77.1 | -85.6 |
Gross amounts offset in the balance sheet | 18.9 | 15.5 |
Net amounts presented in the balance sheet | -77.1 | -85.6 |
Derivative, collateral, right to reclaim securities | 73.4 | 82.5 |
Cash collateral pledged | 3.7 | 3.1 |
Net amount | $0 | $0 |
Fair_Value_of_Financial_Instru2
Fair Value of Financial Instruments - Nonrecurring (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
ASSETS: | ||
Available-for-sale debt securities | $12,985.30 | $12,679.30 |
Separate account assets | 2,969.40 | 3,020.70 |
U.S. government and agency | ||
ASSETS: | ||
Available-for-sale debt securities | 446.7 | 443.4 |
State and political subdivision | ||
ASSETS: | ||
Available-for-sale debt securities | 580.5 | 557.9 |
Foreign government | ||
ASSETS: | ||
Available-for-sale debt securities | 248 | 230.9 |
Corporate | ||
ASSETS: | ||
Available-for-sale debt securities | 8,712.10 | 8,398.10 |
Commercial mortgage-backed (“CMBSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 650.9 | 651.2 |
Residential mortgage-backed (“RMBSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 1,870.90 | 1,932.20 |
Collateralized debt obligations (“CDOâ€) / collateralized loan obligations (“CLOâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 205.5 | 196.9 |
Other asset-backed (“ABSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 270.7 | 268.7 |
Fair Value, Measurements, Nonrecurring | ||
ASSETS: | ||
Available-for-sale debt securities | 12,985.30 | 12,679.30 |
Available-for-sale equity securities | 175.5 | 179.5 |
Short-term investments | 154.7 | 149.7 |
Derivative assets | 140.2 | 161.3 |
Fair value investments | 250.8 | 235.4 |
Separate account assets | 2,969.40 | 3,020.70 |
Total assets | 16,675.90 | 16,425.90 |
LIABILITIES: | ||
Derivative liabilities | 77.1 | 85.6 |
Embedded derivatives | 175.6 | 160.7 |
Total liabilities | 252.7 | 246.3 |
Debt securities fair value | 115 | 111.9 |
Deferred compensation liabilities | 23.8 | 23.5 |
Fair Value, Measurements, Nonrecurring | Consolidated Variable Interest Entity | ||
ASSETS: | ||
Fair value investments | 112 | 100 |
Fair Value, Measurements, Nonrecurring | U.S. government and agency | ||
ASSETS: | ||
Available-for-sale debt securities | 446.7 | 443.4 |
Fair Value, Measurements, Nonrecurring | State and political subdivision | ||
ASSETS: | ||
Available-for-sale debt securities | 580.5 | 557.9 |
Fair Value, Measurements, Nonrecurring | Foreign government | ||
ASSETS: | ||
Available-for-sale debt securities | 248 | 230.9 |
Fair Value, Measurements, Nonrecurring | Corporate | ||
ASSETS: | ||
Available-for-sale debt securities | 8,712.10 | 8,398.10 |
Fair Value, Measurements, Nonrecurring | Commercial mortgage-backed (“CMBSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 650.9 | 651.2 |
Fair Value, Measurements, Nonrecurring | Residential mortgage-backed (“RMBSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 1,870.90 | 1,932.20 |
Fair Value, Measurements, Nonrecurring | Collateralized debt obligations (“CDOâ€) / collateralized loan obligations (“CLOâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 205.5 | 196.9 |
Fair Value, Measurements, Nonrecurring | Other asset-backed (“ABSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 270.7 | 268.7 |
Fair Value, Measurements, Nonrecurring | Level 1 | ||
ASSETS: | ||
Available-for-sale debt securities | 0 | 0 |
Available-for-sale equity securities | 0 | 0 |
Short-term investments | 154.7 | 149.7 |
Derivative assets | 0 | 0 |
Fair value investments | 32.7 | 32.4 |
Separate account assets | 2,969.40 | 3,020.70 |
Total assets | 3,156.80 | 3,202.80 |
LIABILITIES: | ||
Derivative liabilities | 0 | 0.5 |
Embedded derivatives | 0 | 0 |
Total liabilities | 0 | 0.5 |
Fair Value, Measurements, Nonrecurring | Level 1 | Consolidated Variable Interest Entity | ||
ASSETS: | ||
Fair value investments | 8.9 | 8.8 |
Fair Value, Measurements, Nonrecurring | Level 1 | U.S. government and agency | ||
ASSETS: | ||
Available-for-sale debt securities | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | State and political subdivision | ||
ASSETS: | ||
Available-for-sale debt securities | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Foreign government | ||
ASSETS: | ||
Available-for-sale debt securities | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Corporate | ||
ASSETS: | ||
Available-for-sale debt securities | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Commercial mortgage-backed (“CMBSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Residential mortgage-backed (“RMBSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Collateralized debt obligations (“CDOâ€) / collateralized loan obligations (“CLOâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Other asset-backed (“ABSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | ||
ASSETS: | ||
Available-for-sale debt securities | 6,895.80 | 6,394.30 |
Available-for-sale equity securities | 0 | 0 |
Short-term investments | 0 | 0 |
Derivative assets | 140.2 | 161.3 |
Fair value investments | 13.2 | 13 |
Separate account assets | 0 | 0 |
Total assets | 7,049.20 | 6,568.60 |
LIABILITIES: | ||
Derivative liabilities | 77.1 | 85.1 |
Embedded derivatives | 0 | 0 |
Total liabilities | 77.1 | 85.1 |
Fair Value, Measurements, Nonrecurring | Level 2 | U.S. government and agency | ||
ASSETS: | ||
Available-for-sale debt securities | 80.3 | 81.2 |
Fair Value, Measurements, Nonrecurring | Level 2 | State and political subdivision | ||
ASSETS: | ||
Available-for-sale debt securities | 175.1 | 157.7 |
Fair Value, Measurements, Nonrecurring | Level 2 | Foreign government | ||
ASSETS: | ||
Available-for-sale debt securities | 215.6 | 177.3 |
Fair Value, Measurements, Nonrecurring | Level 2 | Corporate | ||
ASSETS: | ||
Available-for-sale debt securities | 4,358 | 3,994.20 |
Fair Value, Measurements, Nonrecurring | Level 2 | Commercial mortgage-backed (“CMBSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 615.7 | 498.4 |
Fair Value, Measurements, Nonrecurring | Level 2 | Residential mortgage-backed (“RMBSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 1,389.30 | 1,461.90 |
Fair Value, Measurements, Nonrecurring | Level 2 | Collateralized debt obligations (“CDOâ€) / collateralized loan obligations (“CLOâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | Other asset-backed (“ABSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 61.8 | 23.6 |
Fair Value, Measurements, Nonrecurring | Level 3 | ||
ASSETS: | ||
Available-for-sale debt securities | 6,089.50 | 6,285 |
Available-for-sale equity securities | 175.5 | 179.5 |
Short-term investments | 0 | 0 |
Derivative assets | 0 | 0 |
Fair value investments | 204.9 | 190 |
Separate account assets | 0 | 0 |
Total assets | 6,469.90 | 6,654.50 |
LIABILITIES: | ||
Derivative liabilities | 0 | 0 |
Embedded derivatives | 175.6 | 160.7 |
Total liabilities | 175.6 | 160.7 |
Fair Value, Measurements, Nonrecurring | Level 3 | U.S. government and agency | ||
ASSETS: | ||
Available-for-sale debt securities | 366.4 | 362.2 |
Fair Value, Measurements, Nonrecurring | Level 3 | State and political subdivision | ||
ASSETS: | ||
Available-for-sale debt securities | 405.4 | 400.2 |
Fair Value, Measurements, Nonrecurring | Level 3 | Foreign government | ||
ASSETS: | ||
Available-for-sale debt securities | 32.4 | 53.6 |
Fair Value, Measurements, Nonrecurring | Level 3 | Corporate | ||
ASSETS: | ||
Available-for-sale debt securities | 4,354.10 | 4,403.90 |
Fair Value, Measurements, Nonrecurring | Level 3 | Commercial mortgage-backed (“CMBSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 35.2 | 152.8 |
Fair Value, Measurements, Nonrecurring | Level 3 | Residential mortgage-backed (“RMBSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 481.6 | 470.3 |
Fair Value, Measurements, Nonrecurring | Level 3 | Collateralized debt obligations (“CDOâ€) / collateralized loan obligations (“CLOâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | 205.5 | 196.9 |
Fair Value, Measurements, Nonrecurring | Level 3 | Other asset-backed (“ABSâ€) | ||
ASSETS: | ||
Available-for-sale debt securities | $208.90 | $245.10 |
Fair_Value_of_Financial_Instru3
Fair Value of Financial Instruments - Corporates Carried on a Recurring Basis (Details) (Recurring, USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Fair Values of Corporates by Level and Sector: | ||
Consumer | $1,905.10 | $1,859.60 |
Energy | 1,057.80 | 1,007.40 |
Financial services | 2,683.80 | 2,585.20 |
Capital goods | 755.2 | 782.9 |
Transportation | 434.2 | 410.5 |
Utilities | 1,092 | 1,031.50 |
Other | 784 | 721 |
Total corporates | 8,712.10 | 8,398.10 |
Level 1 | ||
Fair Values of Corporates by Level and Sector: | ||
Consumer | 0 | 0 |
Energy | 0 | 0 |
Financial services | 0 | 0 |
Capital goods | 0 | 0 |
Transportation | 0 | 0 |
Utilities | 0 | 0 |
Other | 0 | 0 |
Total corporates | 0 | 0 |
Level 2 | ||
Fair Values of Corporates by Level and Sector: | ||
Consumer | 618.3 | 593 |
Energy | 614.7 | 534.6 |
Financial services | 1,785.70 | 1,617.30 |
Capital goods | 402.7 | 398.1 |
Transportation | 120.7 | 104.7 |
Utilities | 372.7 | 348.1 |
Other | 443.2 | 398.4 |
Total corporates | 4,358 | 3,994.20 |
Level 3 | ||
Fair Values of Corporates by Level and Sector: | ||
Consumer | 1,286.80 | 1,266.60 |
Energy | 443.1 | 472.8 |
Financial services | 898.1 | 967.9 |
Capital goods | 352.5 | 384.8 |
Transportation | 313.5 | 305.8 |
Utilities | 719.3 | 683.4 |
Other | 340.8 | 322.6 |
Total corporates | $4,354.10 | $4,403.90 |
Fair_Value_of_Financial_Instru4
Fair Value of Financial Instruments - Changes in Fair Value of Level 3 Financial Assets (Details) (Level 3, Fair Value, Measurements, Nonrecurring, USD $) | 3 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
U.S. government and agency | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | $362.20 | $327.20 | |
Purchases | 0 | 12.9 | |
Sales | -2.1 | -5.4 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Realized & unrealized gains (losses) included in income | 0 | 0 | |
Unrealized gains (losses) included in OCI | 6.3 | 5.7 | |
Balance, end of period | 366.4 | 340.4 | |
State and political subdivision | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 400.2 | 269.1 | |
Purchases | 13.6 | 2.9 | |
Sales | -2.2 | -0.8 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | -14 | 0 | |
Realized & unrealized gains (losses) included in income | 0 | 0 | |
Unrealized gains (losses) included in OCI | 7.8 | 5.6 | |
Balance, end of period | 405.4 | 276.8 | |
Foreign government | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 53.6 | 15.9 | |
Purchases | 0 | 0 | |
Sales | -0.2 | -1 | |
Transfers into Level 3 | 4.2 | 0 | |
Transfers out of Level 3 | -26.7 | 0 | |
Realized & unrealized gains (losses) included in income | 0 | 0 | |
Unrealized gains (losses) included in OCI | 1.5 | 1.2 | |
Balance, end of period | 32.4 | 16.1 | |
Corporate | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 4,403.90 | 3,893.80 | |
Purchases | 220.3 | 171 | |
Sales | -113 | -115.9 | |
Transfers into Level 3 | 62.3 | 0 | |
Transfers out of Level 3 | -285.2 | -127 | |
Realized & unrealized gains (losses) included in income | 2.1 | 2.5 | |
Unrealized gains (losses) included in OCI | 63.7 | 115.9 | |
Balance, end of period | 4,354.10 | 3,940.30 | |
Commercial mortgage-backed (“CMBSâ€) | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 152.8 | 113.7 | |
Purchases | 0 | 0 | |
Sales | -0.1 | -2.7 | |
Transfers into Level 3 | 8.5 | 0 | |
Transfers out of Level 3 | -126.1 | -60.1 | |
Realized & unrealized gains (losses) included in income | 0 | -0.1 | |
Unrealized gains (losses) included in OCI | 0.1 | 1.3 | |
Balance, end of period | 35.2 | 52.1 | |
Residential mortgage-backed (“RMBSâ€) | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 470.3 | 552.7 | |
Purchases | 0.3 | 0.5 | |
Sales | -17.6 | -21.7 | |
Transfers into Level 3 | 29.2 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Realized & unrealized gains (losses) included in income | -0.2 | 1.9 | |
Unrealized gains (losses) included in OCI | -0.4 | 1.8 | |
Balance, end of period | 481.6 | 535.2 | |
Collateralized debt obligations (“CDOâ€) / collateralized loan obligations (“CLOâ€) | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 196.9 | 224.1 | |
Purchases | 24.5 | 23 | |
Sales | -18.4 | -12.3 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Realized & unrealized gains (losses) included in income | 0.5 | 1.8 | |
Unrealized gains (losses) included in OCI | 2 | -0.5 | |
Balance, end of period | 205.5 | 236.1 | |
Other asset-backed (“ABSâ€) | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 245.1 | 247.7 | |
Purchases | 0 | 0 | |
Sales | -7 | -13.3 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | -29.2 | -1.7 | |
Realized & unrealized gains (losses) included in income | -0.4 | 0.1 | |
Unrealized gains (losses) included in OCI | 0.4 | -3.4 | |
Balance, end of period | 208.9 | 229.4 | |
Debt securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 6,285 | 5,644.20 | |
Purchases | 258.7 | 210.3 | |
Sales | -160.6 | -173.1 | |
Transfers into Level 3 | 104.2 | 0 | |
Transfers out of Level 3 | -481.2 | -188.8 | |
Realized & unrealized gains (losses) included in income | 2 | 6.2 | |
Unrealized gains (losses) included in OCI | 81.4 | 127.6 | |
Balance, end of period | 6,089.50 | 5,626.40 | |
Available-for-sale Securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 179.5 | 135.2 | |
Purchases | 7.2 | 6.7 | |
Sales | -1.7 | -1.3 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Realized & unrealized gains (losses) included in income | -6.2 | 0.5 | |
Unrealized gains (losses) included in OCI | -3.3 | -78.1 | |
Balance, end of period | 175.5 | 63 | |
Short-term Investments | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 0.9 | 0 | |
Purchases | 0 | ||
Sales | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Realized & unrealized gains (losses) included in income | 0 | ||
Unrealized gains (losses) included in OCI | -0.9 | ||
Balance, end of period | 0 | 0 | 0 |
Fair value investments | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 190 | 169.9 | |
Purchases | 0.4 | 0 | |
Sales | -1.9 | -2.5 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Realized & unrealized gains (losses) included in income | 16.4 | 2.9 | |
Unrealized gains (losses) included in OCI | 0 | 0 | |
Balance, end of period | 204.9 | 170.3 | |
Total assets | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning of period | 6,654.50 | 5,950.20 | |
Purchases | 266.3 | 217 | |
Sales | -164.2 | -176.9 | |
Transfers into Level 3 | 104.2 | 0 | |
Transfers out of Level 3 | -481.2 | -188.8 | |
Realized & unrealized gains (losses) included in income | 12.2 | 9.6 | |
Unrealized gains (losses) included in OCI | 78.1 | 48.6 | |
Balance, end of period | $6,469.90 | $5,859.70 |
Fair_Value_of_Financial_Instru5
Fair Value of Financial Instruments - Changes in Fair Value of Level 3 Financial Liabilities (Details) (Embedded Derivatives, USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Embedded Derivatives | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Balance, beginning of period | $160.70 | $87.80 |
Net purchases/(sales) | 4.6 | 8.3 |
Transfers into Level 3 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 |
Realized (gains) losses | -10.3 | -12.9 |
Balance, end of period | $175.60 | $109 |
Fair_Value_of_Financial_Instru6
Fair Value of Financial Instruments - Quantitative Estimates for Level 3 Assets (Details) (Level 3, USD $) | 3 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
US Treasury and Government | ||
Level 3 Assets: | ||
U.S. government and agency | 366.4 | 362.2 |
State and political subdivision | ||
Level 3 Assets: | ||
State and political subdivision | 208 | 159.1 |
Corporate | ||
Level 3 Assets: | ||
Corporate | 3,351.60 | 3,116.60 |
Other asset-backed (“ABSâ€) | ||
Level 3 Assets: | ||
Other ABS | 38 | 39.3 |
Fair value investments | ||
Level 3 Assets: | ||
Other ABS | 6.4 | 6.3 |
Income Approach Valuation Technique | Fair value investments | ||
Level 3 Assets: | ||
Fair Value Inputs, Probability of Default | 0.18% | 0.17% |
Fair Value Inputs, Recovery Rate | 44.00% | 44.00% |
Minimum | Market Approach Valuation Technique | US Treasury and Government | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 0.86% | 0.99% |
Minimum | Market Approach Valuation Technique | State and political subdivision | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 1.85% | 2.15% |
Minimum | Market Approach Valuation Technique | Corporate | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 0.85% | 0.93% |
Minimum | Income Approach Valuation Technique | Other asset-backed (“ABSâ€) | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 0.70% | 0.60% |
Maximum | Market Approach Valuation Technique | US Treasury and Government | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 4.04% | 4.27% |
Maximum | Market Approach Valuation Technique | State and political subdivision | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 4.25% | 4.50% |
Maximum | Market Approach Valuation Technique | Corporate | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 6.56% | 6.88% |
Maximum | Income Approach Valuation Technique | Other asset-backed (“ABSâ€) | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 2.60% | 4.00% |
Weighted Average | Market Approach Valuation Technique | US Treasury and Government | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 2.91% | 3.17% |
Weighted Average | Market Approach Valuation Technique | State and political subdivision | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 2.91% | 3.22% |
Weighted Average | Market Approach Valuation Technique | Corporate | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 2.96% | 3.24% |
Weighted Average | Income Approach Valuation Technique | Other asset-backed (“ABSâ€) | ||
Level 3 Assets: | ||
Fair Value Inputs, Yield Rate | 1.69% | 1.92% |
Fair_Value_of_Financial_Instru7
Fair Value of Financial Instruments - Quantitative Estimates for Level 3 Liabilities (Details) (Level 3, USD $) | 3 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
EIA/VED Embedded Derivative | ||
Level 3 Liabilities: | ||
Fair Value, Balance | $166.90 | $153.90 |
GMAB/GMWB Embedded Derivatives | ||
Level 3 Liabilities: | ||
Fair Value, Balance | $8.70 | $6.80 |
Income Approach Valuation Technique | EIA/VED Embedded Derivative | ||
Level 3 Liabilities: | ||
Fair Value Inputs, CSA Rate | 3.19% | 3.08% |
Income Approach Valuation Technique | GMAB/GMWB Embedded Derivatives | ||
Level 3 Liabilities: | ||
Fair Value Inputs, Mortality Rate | 105.00% | 105.00% |
Fair Value Inputs, CSA Rate | 3.19% | 3.08% |
Income Approach Valuation Technique | Minimum | EIA/VED Embedded Derivative | ||
Level 3 Liabilities: | ||
Fair Value Inputs, Swap Curve | 0.31% | 0.24% |
Fair Value Inputs, Mortality Rate | 97.00% | 97.00% |
Fair Value Inputs, Lapse Rate | 0.04% | 0.04% |
Income Approach Valuation Technique | Minimum | GMAB/GMWB Embedded Derivatives | ||
Level 3 Liabilities: | ||
Fair Value Inputs, Swap Curve | 0.22% | 0.21% |
Fair Value Inputs, Lapse Rate | 0.00% | 0.00% |
Fair Value Inputs, Volatility Surface | 8.58% | 9.89% |
Income Approach Valuation Technique | Maximum | EIA/VED Embedded Derivative | ||
Level 3 Liabilities: | ||
Fair Value Inputs, Swap Curve | 2.27% | 2.55% |
Fair Value Inputs, Mortality Rate | 105.00% | 105.00% |
Fair Value Inputs, Lapse Rate | 46.44% | 46.44% |
Income Approach Valuation Technique | Maximum | GMAB/GMWB Embedded Derivatives | ||
Level 3 Liabilities: | ||
Fair Value Inputs, Swap Curve | 2.44% | 2.76% |
Fair Value Inputs, Lapse Rate | 40.00% | 40.00% |
Fair Value Inputs, Volatility Surface | 50.72% | 67.34% |
Fair_Value_of_Financial_Instru8
Fair Value of Financial Instruments - Level 3 Assets and Liabilities by Pricing Source (Details) (Fair Value, Measurements, Nonrecurring, Level 3, USD $) | Mar. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total liabilities Internal | $175.60 | $160.70 | ||
Total liabilities External | 0 | 0 | ||
Total liabilities | 175.6 | 160.7 | ||
Embedded Derivatives | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total liabilities Internal | 175.6 | 160.7 | ||
Total liabilities External | 0 | 0 | ||
Total liabilities | 175.6 | 160.7 | ||
U.S. government and agency | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 366.4 | 362.2 | ||
Total assets External | 0 | 0 | ||
Fair Value, Total assets, Balance | 366.4 | 362.2 | 340.4 | 327.2 |
State and political subdivision | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 208 | 159.1 | ||
Total assets External | 197.4 | 241.1 | ||
Fair Value, Total assets, Balance | 405.4 | 400.2 | 276.8 | 269.1 |
Foreign government | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 0 | 0 | ||
Total assets External | 32.4 | 53.6 | ||
Fair Value, Total assets, Balance | 32.4 | 53.6 | 16.1 | 15.9 |
Corporate | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 3,351.60 | 3,116.60 | ||
Total assets External | 1,002.50 | 1,287.30 | ||
Fair Value, Total assets, Balance | 4,354.10 | 4,403.90 | 3,940.30 | 3,893.80 |
Commercial mortgage-backed (“CMBSâ€) | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 0 | 0 | ||
Total assets External | 35.2 | 152.8 | ||
Fair Value, Total assets, Balance | 35.2 | 152.8 | 52.1 | 113.7 |
Residential mortgage-backed (“RMBSâ€) | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 0 | 0 | ||
Total assets External | 481.6 | 470.3 | ||
Fair Value, Total assets, Balance | 481.6 | 470.3 | 535.2 | 552.7 |
Collateralized debt obligations (“CDOâ€) / collateralized loan obligations (“CLOâ€) | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 0 | 0 | ||
Total assets External | 205.5 | 196.9 | ||
Fair Value, Total assets, Balance | 205.5 | 196.9 | 236.1 | 224.1 |
Other asset-backed (“ABSâ€) | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 38 | 39.3 | ||
Total assets External | 170.9 | 205.8 | ||
Fair Value, Total assets, Balance | 208.9 | 245.1 | 229.4 | 247.7 |
Debt securities | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 3,964 | 3,677.20 | ||
Total assets External | 2,125.50 | 2,607.80 | ||
Fair Value, Total assets, Balance | 6,089.50 | 6,285 | 5,626.40 | 5,644.20 |
Available-for-sale Securities | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 0 | 0 | ||
Total assets External | 175.5 | 179.5 | ||
Fair Value, Total assets, Balance | 175.5 | 179.5 | 63 | 135.2 |
Short-term Investments | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 0 | 0 | ||
Total assets External | 0 | 0 | ||
Fair Value, Total assets, Balance | 0 | 0 | 0 | 0.9 |
Fair value investments | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 6.4 | 6.3 | ||
Total assets External | 198.5 | 183.7 | ||
Fair Value, Total assets, Balance | 204.9 | 190 | 170.3 | 169.9 |
Total assets | ||||
Level 3 Assets and Liabilities by Pricing Source: | ||||
Total assets Internal | 3,970.40 | 3,683.50 | ||
Total assets External | 2,499.50 | 2,971 | ||
Fair Value, Total assets, Balance | $6,469.90 | $6,654.50 | $5,859.70 | $5,950.20 |
Fair_Value_of_Financial_Instru9
Fair Value of Financial Instruments - Financial Instruments Not Carried at Fair Value (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Policy loans | Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying Value of Financial instruments | $2,363.90 | $2,352.10 |
Fair Value of Financial instruments | 2,350.70 | 2,339.20 |
Cash and cash equivalents | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying Value of Financial instruments | 347.5 | 450 |
Fair Value of Financial instruments | 347.5 | 450 |
Life settlements | Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying Value of Financial instruments | 22.6 | 22.4 |
Fair Value of Financial instruments | 17.7 | 17.4 |
Investment contracts | Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying Value of Financial instruments | 4,084.60 | 3,955 |
Fair Value of Financial instruments | 4,087.10 | 3,957.30 |
7.15 % Surplus notes | Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying Value of Financial instruments | 126.2 | 126.2 |
Fair Value of Financial instruments | 111.5 | 95.8 |
7.45% Senior unsecured bonds | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying Value of Financial instruments | 252.7 | 252.7 |
Fair Value of Financial instruments | $250.30 | $248 |
Recovered_Sheet1
Fair Value of Financial Instruments Fair Value of Financial Instruments - Narrative (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value investments | $250.80 | $235.40 |
Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value investments | $27.90 | $27.80 |
Income_Taxes_Details_Narrative
Income Taxes (Details Narrative) (USD $) | 1 Months Ended | 3 Months Ended | ||
In Millions, unless otherwise specified | Oct. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Operating Loss Carryforwards [Line Items] | ||||
Income tax expense | $2.20 | $4.80 | ||
Current income tax benefit | 0.8 | |||
Deferred income tax expense (benefit) | 1.4 | |||
Deferred tax asset, net of deferred tax liabilities and valuation allowances | 28.7 | |||
Net increase in the deferred tax asset valuation allowance recognized | 30.9 | |||
Decrease in deferred tax assets | 5.5 | |||
Amount of funds in intercompany tax escrow | 78.9 | 78.9 | ||
Parent Company | ||||
Operating Loss Carryforwards [Line Items] | ||||
Increase in restricted cash | $10.80 | $10.80 |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Income (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Accumulated Other Comprehensive Income (Loss), Beginning Balance | ($234.40) | ($185) |
Change in component during the period before reclassifications | -4.1 | -2.1 |
Amounts reclassified from AOCI | 1.9 | -5.2 |
Accumulated Other Comprehensive Income (Loss), Ending Balance | -236.6 | -192.3 |
Net Unrealized Gains / (Losses) on Investments where Credit-related OTTI was Recognized | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Accumulated Other Comprehensive Income (Loss), Beginning Balance | 9.9 | 7 |
Change in component during the period before reclassifications | -0.5 | 6.2 |
Amounts reclassified from AOCI | -1.2 | -3 |
Accumulated Other Comprehensive Income (Loss), Ending Balance | 8.2 | 10.2 |
Net-Unrealized Gains / (Losses) on All Other Investments | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Accumulated Other Comprehensive Income (Loss), Beginning Balance | 54.8 | 26.9 |
Change in component during the period before reclassifications | -3.6 | -9 |
Amounts reclassified from AOCI | 1.7 | -3.2 |
Accumulated Other Comprehensive Income (Loss), Ending Balance | 52.9 | 14.7 |
Net Pension Liability Adjustments | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Accumulated Other Comprehensive Income (Loss), Beginning Balance | -299.1 | -218.9 |
Change in component during the period before reclassifications | 0 | 0.7 |
Amounts reclassified from AOCI | 1.4 | 1 |
Accumulated Other Comprehensive Income (Loss), Ending Balance | ($297.70) | ($217.20) |
Accumulated_Other_Comprehensiv3
Accumulated Other Comprehensive Income Reclassification Out of Accumulated Other Comprehensive Income (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Net realized capital gains (losses) | ($16.10) | ($26.90) |
Amortization of actuarial gains (losses) | 0.3 | 0.3 |
Amortization of prior service costs | -2.5 | -2 |
Income tax expense (benefit) | -2.2 | -4.8 |
Net income (loss) | -73 | -28.2 |
Reclassification out of Accumulated Other Comprehensive Income | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Net income (loss) | -1.9 | 5.2 |
Net Unrealized Gains / (Losses) on Investments where Credit-related OTTI was Recognized | Reclassification out of Accumulated Other Comprehensive Income | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Net realized capital gains (losses) | 1.9 | 4.6 |
Total before income taxes | 1.9 | 4.6 |
Income tax expense (benefit) | 0.7 | 1.6 |
Net income (loss) | 1.2 | 3 |
Net-Unrealized Gains / (Losses) on All Other Investments | Reclassification out of Accumulated Other Comprehensive Income | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Net realized capital gains (losses) | -2.7 | 4.8 |
Total before income taxes | -2.7 | 4.8 |
Income tax expense (benefit) | -1 | 1.6 |
Net income (loss) | -1.7 | 3.2 |
Net Pension Liability Adjustments | Reclassification out of Accumulated Other Comprehensive Income | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Amortization of actuarial gains (losses) | -2.4 | -1.9 |
Amortization of prior service costs | 0.3 | 0.3 |
Total before income taxes | -2.1 | -1.6 |
Income tax expense (benefit) | -0.7 | -0.6 |
Net income (loss) | ($1.40) | ($1) |
Components_of_Pension_Benefit_
Components of Pension Benefit Costs (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Compensation and Retirement Disclosure [Abstract] | ||
Service cost | $0.80 | $0.60 |
Interest cost | 8.6 | 9.1 |
Expected return on plan assets | -10 | -9.5 |
Net loss amortization | 2.5 | 2 |
Pension benefit cost | $1.90 | $2.20 |
Components_of_Other_Postretire
Components of Other Postretirement Benefit Costs (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Compensation and Retirement Disclosure [Abstract] | ||
Service cost | $0 | $0 |
Interest cost | 0.4 | 0.4 |
Net gain amortization | -0.1 | -0.1 |
Prior service cost amortization | -0.3 | -0.3 |
Other post-employment benefit cost | $0 | $0 |
Employee_Benefit_Plans_and_Emp2
Employee Benefit Plans and Employment Agreements - Narrative (Detail) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Compensation and Retirement Disclosure [Abstract] | ||
Amortization of prior service costs included in OCI | $0.90 | |
Contributions to savings plan | $1.50 | $1.40 |
Earnings_Per_Share_Details
Earnings Per Share (Details) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Earnings Per Share [Abstract] | ||
Weighted-average common shares outstanding | 5,751 | 5,742 |
Weighted-average effect of dilutive potential common shares: | ||
Restricted stock units | 0 | 17 |
Employee stock options | 0 | 2 |
Potential common shares | 0 | 19 |
Less: Potential common shares excluded from calculation due to net losses | 19 | |
Dilutive potential common shares | 0 | 0 |
Weighted-average common shares outstanding, including dilutive potential common shares | 5,751 | 5,742 |
Segment_Information_on_Revenue
Segment Information on Revenues (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Segment Reporting Information [Line Items] | ||
Revenues | $405.40 | $399 |
Interest revenue | 0 | 0.1 |
Commission revenue | 3.4 | 2.6 |
Operating Segments | Life and Annuity | ||
Segment Reporting Information [Line Items] | ||
Revenues | 399.8 | 394.2 |
Operating Segments | Saybrus Partners | ||
Segment Reporting Information [Line Items] | ||
Revenues | 9 | 7.3 |
Intersegment Eliminations | ||
Segment Reporting Information [Line Items] | ||
Revenues | $3.40 | $2.50 |
Results_of_Operations_by_Segme
Results of Operations by Segment as Reconciled to Consolidated Net Income (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Segment Reporting [Abstract] | ||
Life and Annuity operating income (loss) | ($59.40) | ($5.80) |
Saybrus Partners operating income (loss) | 0.8 | 0.3 |
Less: Applicable income tax expense (benefit) | 2.2 | 4.8 |
Income (loss) from discontinued operations, net of income taxes | -0.5 | -0.6 |
Net realized gains (losses) | -16.1 | -26.9 |
Less: Net income (loss) attributable to noncontrolling interests | 1 | -0.1 |
Net income (loss) attributable to The Phoenix Companies, Inc. | ($74) | ($28.10) |
Discontinued_Operations_Detail
Discontinued Operations (Details Narrative) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Discontinued operations assets | $45,600,000 | $45,200,000 | |
Discontinued operations liabilities | 40,600,000 | 40,500,000 | |
PFG Holdings Inc. | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Discontinued operations assets | 0 | 0 | |
Provision for loss on disposal | 0 | ||
Discontinued operations liabilities | 0 | 0 | |
Reinsurance Operations | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Provision for loss on disposal | 500,000 | 600,000 | |
Discontinued operations liabilities | 39,300,000 | 39,300,000 | |
Amount recoverable from retrocessionaires related to paid losses | $500,000 | $100,000 |
Contingent_Liabilities_Details
Contingent Liabilities (Details Narrative) (USD $) | 0 Months Ended | 1 Months Ended | 0 Months Ended | 3 Months Ended | ||
Mar. 23, 2015 | Mar. 31, 2014 | Apr. 30, 2015 | Jul. 12, 2013 | Mar. 31, 2015 | Aug. 26, 2013 | |
policy | case | case | claim | |||
state | ||||||
claim | ||||||
Loss Contingencies [Line Items] | ||||||
Litigation settlement, amount | $1,100,000 | |||||
Loss Contingency, Number Of Policies Due Restitution | 7 | |||||
Subsequent Event | ||||||
Loss Contingencies [Line Items] | ||||||
Litigation settlement, amount | $48,500,000 | |||||
COI Rate Adjustments | ||||||
Loss Contingencies [Line Items] | ||||||
Complaints to state insurance departments, number of states | 6 | |||||
United States District Court for the Southern District of New York | Pending Litigation | ||||||
Loss Contingencies [Line Items] | ||||||
Number of pending claims | 2 | |||||
Number of decertified pending claims | 1 | |||||
Number of new claims filed | 4 | 6 | ||||
Number of states issuing letters directing to take remedial action | 2 | |||||
United States District Court for the Southern District of New York | Pending Litigation | PHL Variable | ||||||
Loss Contingencies [Line Items] | ||||||
Number of new claims filed | 5 | |||||
United States District Court for the Southern District of New York | Pending Litigation | PHL Variable and Phoenix Life | ||||||
Loss Contingencies [Line Items] | ||||||
Number of new claims filed | 1 |
Other_Commitments_Narrative_De
Other Commitments Narrative (Details) (USD $) | 3 Months Ended | 0 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Jan. 05, 2015 |
Long-term Purchase Commitment [Line Items] | |||
Remaining commitments through 2015 | $10.40 | ||
Unfunded commitments | 230.7 | ||
Amount of unfunded commitments expected to be funded | 52.3 | ||
Purchase commitment maximum amount | 50 | ||
Purchase of available-for-sale debt securities | 530.6 | 338.4 | |
Open commitments | 103.7 | ||
Investment Grade Bonds | |||
Long-term Purchase Commitment [Line Items] | |||
Purchase of available-for-sale debt securities | 8 | ||
Investment Grade Bonds | |||
Long-term Purchase Commitment [Line Items] | |||
Purchase Commitment, Remaining Minimum Amount Committed | $100 | ||
Purchase commitments | 24 months |