Document and Entity Information
Document and Entity Information | 9 Months Ended |
Sep. 30, 2018shares | |
Entity Information [Line Items] | |
Entity Registrant Name | TRIPLE-S MANAGEMENT CORP |
Entity Central Index Key | 1,171,662 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Ex Transition Period | false |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | Sep. 30, 2018 |
Document Fiscal Year Focus | 2,018 |
Document Fiscal Period Focus | Q3 |
Common Class A [Member] | |
Entity Information [Line Items] | |
Entity Common Stock, Shares Outstanding | 950,968 |
Common Class B [Member] | |
Entity Information [Line Items] | |
Entity Common Stock, Shares Outstanding | 21,985,524 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Investments and cash: | ||
Fixed maturities available for sale, at fair value | $ 1,224,050 | $ 1,216,788 |
Fixed maturities held to maturity, at amortized cost | 2,490 | 2,319 |
Equity investments, at fair value | 306,360 | 342,309 |
Other invested assets, at net asset value | 73,127 | 34,984 |
Policy loans | 9,680 | 9,077 |
Cash and cash equivalents | 107,091 | 198,941 |
Total investments and cash | 1,722,798 | 1,804,418 |
Premiums and other receivables, net | 632,897 | 899,327 |
Deferred policy acquisition costs and value of business acquired | 209,205 | 200,788 |
Property and equipment, net | 78,445 | 74,716 |
Deferred tax asset | 83,593 | 65,123 |
Goodwill | 25,397 | 25,397 |
Other assets | 66,093 | 46,996 |
Total assets | 2,818,428 | 3,116,765 |
Liabilities and Stockholders' Equity | ||
Claim liabilities | 1,038,114 | 1,106,876 |
Liability for future policy benefits | 355,366 | 339,507 |
Unearned premiums | 78,544 | 86,349 |
Policyholder deposits | 174,126 | 176,534 |
Liability to Federal Employees' Health Benefits and Federal Employees' Programs | 41,880 | 52,287 |
Accounts payable and accrued liabilities | 246,750 | 354,894 |
Deferred tax liability | 3,210 | 21,891 |
Long-term borrowings | 29,681 | 32,073 |
Liability for pension benefits | 30,919 | 33,672 |
Total liabilities | 1,998,590 | 2,204,083 |
Triple-S Management Corporation stockholders' equity | ||
Additional paid-in capital | 34,231 | 53,142 |
Retained earnings | 772,872 | 785,390 |
Accumulated other comprehensive (loss) income | (9,531) | 51,254 |
Total Triple-S Management Corporation stockholders' equity | 820,509 | 913,364 |
Non-controlling interest in consolidated subsidiary | (671) | (682) |
Total stockholders' equity | 819,838 | 912,682 |
Total liabilities and stockholders' equity | 2,818,428 | 3,116,765 |
Common Stock Class A [Member] | ||
Triple-S Management Corporation stockholders' equity | ||
Common stock | 951 | 951 |
Common Stock Class B [Member] | ||
Triple-S Management Corporation stockholders' equity | ||
Common stock | $ 21,986 | $ 22,627 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
Class A Common Stock [Member] | ||
Triple-S Management Corporation stockholders' equity | ||
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, issued (in shares) | 950,968 | 950,968 |
Common stock, outstanding (in shares) | 950,968 | 950,968 |
Class B Common Stock [Member] | ||
Triple-S Management Corporation stockholders' equity | ||
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, issued (in shares) | 21,985,524 | 22,627,077 |
Common stock, outstanding (in shares) | 21,985,524 | 22,627,077 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Earnings (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenues: | ||||
Premiums earned, net | $ 742,445 | $ 714,325 | $ 2,236,249 | $ 2,139,489 |
Net investment income | 16,168 | 12,395 | 45,630 | 37,109 |
Total operating revenues | 763,990 | 731,052 | 2,297,329 | 2,191,943 |
Net realized investment (losses) gains | (956) | 3,753 | 1,065 | 8,143 |
Net unrealized investment gains (losses) on equity investments | 5,632 | 0 | (11,343) | 0 |
Other income, net | 1,943 | 3,409 | 3,600 | 6,521 |
Total revenues | 770,609 | 738,214 | 2,290,651 | 2,206,607 |
Benefits and expenses: | ||||
Claims incurred | 648,580 | 583,625 | 1,959,707 | 1,815,785 |
Operating expenses | 141,026 | 119,145 | 408,772 | 348,811 |
Total operating costs | 789,606 | 702,770 | 2,368,479 | 2,164,596 |
Interest expense | 2,000 | 1,709 | 5,515 | 5,116 |
Total benefits and expenses | 791,606 | 704,479 | 2,373,994 | 2,169,712 |
(Loss) income before taxes | (20,997) | 33,735 | (83,343) | 36,895 |
Income tax (benefit) expense | (3,430) | 11,824 | (30,944) | 6,622 |
Net (loss) income | (17,567) | 21,911 | (52,399) | 30,273 |
Net (loss) income attributable to non-controlling interest | 0 | (1) | 1 | (2) |
Net (loss) income attributable to Triple-S Management Corporation | (17,567) | 21,912 | (52,400) | 30,275 |
Administrative Service Fess [Member] | ||||
Revenues: | ||||
Total operating revenues | 3,802 | 3,391 | 11,216 | 12,318 |
Other [Member] | ||||
Revenues: | ||||
Total operating revenues | $ 1,575 | $ 941 | $ 4,234 | $ 3,027 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive (Loss) Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Condensed Consolidated Statements of Comprehensive (Loss) Income (Unaudited) [Abstract] | ||||
Net (loss) income | $ (17,567) | $ 21,911 | $ (52,399) | $ 30,273 |
Other comprehensive (loss) income, net of tax: | ||||
Net unrealized change in fair value of available for sale securities, net of taxes | (6,216) | 1,851 | (21,312) | 14,719 |
Defined benefit pension plan: | ||||
Actuarial loss, net | 147 | 48 | 409 | 154 |
Total other comprehensive (loss) income, net of tax | (6,069) | 1,899 | (20,903) | 14,873 |
Comprehensive (loss) income | (23,636) | 23,810 | (73,302) | 45,146 |
Comprehensive (loss) income attributable to non-controlling interest | 0 | (1) | 1 | (2) |
Comprehensive (loss) income attributable to Triple-S Management Corporation | $ (23,636) | $ 23,811 | $ (73,303) | $ 45,148 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) $ in Thousands | USD ($) |
Balance at Dec. 31, 2016 | $ 863,163 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |
Share-based compensation | 1,651 |
Repurchase and retirement of common stock | (12,553) |
Comprehensive (loss) income | 45,148 |
Total Triple-S Management Corporation stockholders' equity at Sep. 30, 2017 | 897,409 |
Non-controlling interest in consolidated subsidiary at Sep. 30, 2017 | (679) |
Balance at Sep. 30, 2017 | 896,730 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |
Comprehensive (loss) income | 23,811 |
Total Triple-S Management Corporation stockholders' equity at Sep. 30, 2017 | 897,409 |
Non-controlling interest in consolidated subsidiary at Sep. 30, 2017 | (679) |
Balance at Sep. 30, 2017 | 896,730 |
Balance at Dec. 31, 2017 | 913,364 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |
Share-based compensation | 3,462 |
Repurchase and retirement of common stock | (23,014) |
Comprehensive (loss) income | (73,303) |
Total Triple-S Management Corporation stockholders' equity at Sep. 30, 2018 | 820,509 |
Non-controlling interest in consolidated subsidiary at Sep. 30, 2018 | (671) |
Balance at Sep. 30, 2018 | 819,838 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |
Comprehensive (loss) income | (23,636) |
Total Triple-S Management Corporation stockholders' equity at Sep. 30, 2018 | 820,509 |
Non-controlling interest in consolidated subsidiary at Sep. 30, 2018 | (671) |
Balance at Sep. 30, 2018 | $ 819,838 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cash flows from operating activities: | ||
Net (loss) income | $ (52,399) | $ 30,273 |
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 9,933 | 9,835 |
Net amortization of investments | 3,747 | 7,396 |
Additions to the allowance for doubtful receivables | 7,085 | 2,043 |
Deferred tax benefit | (33,006) | (9,993) |
Net realized investment gain on sale of securities | (1,065) | (8,143) |
Net unrealized loss on equity investments | 11,343 | 0 |
Interest credited to policyholder deposits | 4,288 | 3,151 |
Share-based compensation | 3,462 | 1,651 |
Decrease (increase) in assets: | ||
Premium and other receivables, net | 259,345 | (646,650) |
Deferred policy acquisition costs and value of business acquired | (5,943) | (7,139) |
Deferred taxes | 606 | (218) |
Other assets | (19,657) | 2,976 |
(Decrease) increase in liabilities: | ||
Claim liabilities | (68,762) | 620,755 |
Liability for future policy benefits | 15,859 | 15,286 |
Unearned premiums | (7,805) | 86,509 |
Liability to Federal Employees' Health Benefits and Federal Employees' Programs | (10,407) | 12,372 |
Accounts payable and accrued liabilities | (120,552) | 71,745 |
Net cash (used in) provided by operating activities | (3,928) | 191,849 |
Securities available for sale: | ||
Fixed maturities sold | 1,042,720 | 287,223 |
Fixed maturities matured/called | 18,133 | 15,503 |
Securities held to maturity: | ||
Fixed maturities matured/called | 2,066 | 1,546 |
Equity investments sold | 150,024 | 38,318 |
Other invested assets sold | 2,040 | 0 |
Securities available for sale: | ||
Fixed maturities | (1,113,587) | (260,538) |
Securities held to maturity: | ||
Fixed maturities | (2,238) | (1,550) |
Equity investments | (113,108) | (75,507) |
Other invested assets | (38,501) | 0 |
Decrease in other investments | (144) | (2,207) |
Net change in policy loans | (603) | (696) |
Net capital expenditures | (12,315) | (15,949) |
Net cash used in investing activities | (65,513) | (13,857) |
Cash flows from financing activities: | ||
Change in outstanding checks in excess of bank balances | 9,104 | 8,371 |
Repayments of long-term borrowings | (2,427) | (2,028) |
Repurchase and retirement of common stock | (22,390) | (12,553) |
Proceeds from policyholder deposits | 14,726 | 12,130 |
Surrenders of policyholder deposits | (21,422) | (17,398) |
Net cash used in financing activities | (22,409) | (11,478) |
Net (decrease) increase in cash and cash equivalents | (91,850) | 166,514 |
Cash and cash equivalents: | ||
Beginning of period | 198,941 | 103,428 |
End of period | $ 107,091 | $ 269,942 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2018 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | (1) Basis of Presentation The accompanying condensed consolidated interim financial statements prepared by Triple-S Management Corporation and its subsidiaries are unaudited. In this filing, the “Corporation”, the “Company”, “TSM”, “we”, “us” and “our” refer to Triple-S Management Corporation and its subsidiaries. The condensed consolidated interim financial statements do not include all the information and the footnotes required by accounting principles generally accepted in the United States of America (GAAP or U.S. GAAP) for complete financial statement presentation. These condensed consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements included in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2017. In the opinion of management, all adjustments, consisting of a normal recurring nature necessary for a fair presentation of such condensed consolidated interim financial statements, have been included. The results of operations for the three months and nine months ended 30, 2018 are not necessarily indicative of the results for the full year ending December 31, 2018. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Significant Accounting Policies [Abstract] | |
Significant Accounting Policies | (2) Significant Accounting Policies Investments Fixed maturities and other invested assets Investment in debt securities at September 30, 2018 and December 31, 2017 consists mainly of obligations of government‑sponsored enterprises, U.S. Treasury securities and obligations of U.S. government instrumentalities, municipal securities, corporate bonds, residential mortgage-backed securities, and collateralized mortgage obligations. The Company classifies its debt securities in one of two categories: available-for-sale or held-to-maturity. Securities classified as held-to-maturity are those securities in which the Company has the ability and intent to hold until maturity. All other securities not included in held-to-maturity are classified as available-for-sale. Available-for-sale securities are recorded at fair value. The fair values of debt securities (both available-for-sale and held-to-maturity investments) are based on quoted market prices for those or similar investments at the reporting date. Held-to-maturity debt securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums and discounts, respectively. Unrealized holding gains and losses, net of the related tax effect, on available-for-sale securities are excluded from earnings and are reported as a separate component of other comprehensive income until realized. Realized gains and losses from the sale of available-for-sale securities are included in earnings and are determined on a specific‑identification basis. Transfers of securities between categories are recorded at fair value at the date of transfer. Unrealized holding gains or losses associated with transfers of securities from held-to-maturity to available-for-sale are recorded as a separate component of other comprehensive income. The unrealized holding gains or losses included in the separate component of other comprehensive income for securities transferred from available-for-sale to held-to-maturity, are maintained and amortized into earnings over the remaining life of the security as an adjustment to yield in a manner consistent with the amortization or accretion of premium or discount on the associated security. If a fixed maturity security is in an unrealized loss position and the Company has the intent to sell the fixed maturity security, or it is more likely than not that the Company will have to sell the fixed maturity security before recovery of its amortized cost basis, the decline in value is deemed to be other-than-temporary and is recorded to other-than-temporary impairment losses recognized in earnings in the Company’s consolidated statements of earnings. For impaired fixed maturity securities that the Company does not intend to sell or it is more likely than not that such securities will not have to be sold, but the Company expects not to fully recover the amortized cost basis, the credit component of the other-than-temporary impairment is recognized in other-than-temporary impairment losses recognized in earnings in the Company’s consolidated statements of earnings and the non-credit component of the other-than-temporary impairment is recognized in other comprehensive income. Furthermore, unrealized losses entirely caused by non-credit related factors related to fixed maturity securities for which the Company expects to fully recover the amortized cost basis continue to be recognized in accumulated other comprehensive income. The credit component of an other-than-temporary impairment is determined by comparing the net present value of projected future cash flows with the amortized cost basis of the fixed maturity security. The net present value is calculated by discounting the Company’s best estimate of projected future cash flows at the effective interest rate implicit in the fixed maturity security at the date of acquisition. A decline in the fair value of any available-for-sale or held-to-maturity security below cost that is deemed to be other-than-temporary results in an impairment to reduce the carrying amount to fair value. The impairment is charged to earnings and a new cost basis for the security is established. To determine whether an impairment is other-than-temporary, the Company considers whether it has the ability and intent to hold the investment until a market price recovery and considers whether evidence indicating the cost of the investment is recoverable outweighs evidence to the contrary. Evidence considered in this assessment includes the reasons for the impairment, the severity and duration of the impairment, market conditions, changes in value subsequent to year-end, forecasted performance of the investee, and the general market condition in the geographic area or industry the investee operates in. Premiums and discounts are amortized or accreted over the life of the related held-to-maturity or available-for-sale security as an adjustment to yield using the effective interest method. Dividend and interest income are recognized when earned. The Company regularly invests in mortgaged-backed securities and other securities subject to prepayment and call risk. Significant changes in prevailing interest rates may adversely affect the timing and amount of cash flows on such securities. In addition, the amortization of market premium and accretion of market discount for mortgaged-backed securities is based on historical experience and estimates of future payment speeds on the underlying mortgage loans. Actual prepayment speeds may differ from original estimates and may result in material adjustments to amortization or accretion recorded in future periods. Other invested assets at 30, 2018 and December 31, 2017 consist mainly of alternative investments in partnerships which invest in several private debt and private equity funds. Total unfunded capital commitments for these positions as of 30, 2018 amounted to $88,691. The remaining average commitments period is approximately three years. Equity investments Investment in equity securities at September 30, 2018 and December 31, 2017 consists of mutual funds whose underlying assets are comprised of domestic equity securities, international equity securities and higher risk fixed income instruments. Equity investments are recorded at fair value. The fair values of equity investments are based on quoted market prices. Unrealized holding gains and losses, on equity investments are included in earnings. Realized gains and losses from the sale of equity investments are included in earnings and are determined on a specific‑identification basis. Recent Accounting Standards On August 29, 2018, the Financial Accounting Standard Board (FASB) issued guidance for Intangibles – Goodwill and Other – Internal-Use Software. Guidance addresses customer’s accounting for implemented costs incurred in a cloud computing arrangement that is a service contract and aims to reduce complexity in the accounting for costs of implementing a cloud computing service arrangement. The amendments require a customer in a hosting arrangement that is a service contract to determine which implementation costs to capitalize as an asset related to service contract and which costs to expense. Additionally, it requires the customer to expense the capitalized implementation costs over the term of the hosting arrangement. For public companies, these amendments, will be applied on a prospective basis, for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The adoption of this guidance should not have a material impact on the presentation of the Company’s consolidated result of operations. On August 28, 2018, the FASB issued guidance for Compensation – Retirement Benefits – Defined Benefit Plans – General which addresses changes to the disclosure requirement for defined benefit plans. The amendments in this guidance modify the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. Specifically certain disclosure requirements are removed (i.e. the amounts of accumulated other comprehensive income expected to be recognized as components of net periodic benefit cost over the next fiscal year, related party disclosures concerning the amount of future annual benefits covered by an insurance and annuity contracts and significant transactions between the employer and related parties and the plan) while certain other disclosures are added (i.e. the weighted-average interest crediting rates for cash balance plans and other plans with promised interest crediting rates, an explanation for the reasons for significant gains and losses related to changes in the benefit obligation for the period). For public companies, these amendments, will be applied for fiscal years beginning after December 15, 2020. The adoption of this guidance should not have a material impact on the presentation of the Company’s consolidated result of operations. On August 27, 2018, the FASB issued guidance for Fair Value Measurement – Disclosure Framework – Changes to the Disclosure Requirement for Fair Value Measurement. This update focuses on improving the effectiveness of disclosures in the notes to the financial statements by facilitating clear communication of the information required by U.S. GAAP that is most important to users of each entity’s financial statements. Specifically certain disclosure requirements are removed (the amount of, and reasons for, transfer between Level 1 and Level 2 of the fair value hierarchy; the policy for timing of transfers between levels; the valuation processes for Level 3 fair value measurements) while it modifies and adds certain other disclosures (the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period, and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements). The amendments regarding changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent period in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. For public companies, these amendments will be applied for fiscal years beginning after December 15, 2019. The adoption of this guidance should not have a material impact on the presentation of the Company’s consolidated result of operations. On August 15, 2018, the FASB issued guidance for Financial Services – Insurance: Targeted Improvements to the Accounting for Long-Duration Contracts which provides meaningful improvements to the existing revenue recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. The amendments improve the timeliness of recognizing changes in the liability for future policy benefits and modify rate used to discount future cash flows, simplify and improve the accounting for certain market-based options or guarantees associated with deposit contracts, simplify the amortization of deferred acquisition costs, and improves the effectiveness of the required disclosures. Specifically, this guidance requires an insurance entity to review and update, if needed, the assumptions used to measure cash flows and discount rate at each reporting date, measure all market risk benefits associated with deposit and disclose liability rollforwards and information about significant inputs, judgments, assumptions, and methods used in measurement, including changes thereto and the effect of those changes on measurement. Additionally, the amendment simplifies the amortization of deferred acquisition costs and other balances amortized in proportion to premiums, gross profits, or gross margins, and requires that those balances be amortized on a constant level basis over the expected term of the related contracts. For public companies, these amendments will be applied for fiscal years beginning after December 15, 2020. We are currently evaluating the impact the adoption of this guidance may have on the Company’s consolidated financial statements. On July 30, 2018 and July 18, 2018, the FASB issued the following guidance Leases – Targeted Improvement and Codification Improvement to Leases, respectively, to assist in the implementation of leases and address certain technical corrections and improvement to the recently issued lease standard. Leases – Targeted Improvement provides entities with an additional and optional transition method to adopt the new lease standard under which an entity initially applies the new leases standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. It also provides lessors with a practical expedient, by class of underlying asset, to not separate non-lease components for the associated lease component. Codification: Improvement Leases addresses the following areas of correction or improvement (1) residual value guarantees, (2) rate implicit in the lease, (3) lessee reassessment of lease classification, (4) lessor reassessment of lease term and purchase option, (5) variable lease payments that depend on an index or a rate, (6) investment tax credits, (7) lease term and purchase option, (8) transition guidance for amounts previously recognized in business combinations, (9) certain transition adjustments, (10) transition guidance for leases previously classified as capital leases, (11) transition guidance for modification to leases previously classified as direct financing or sales-type leases, (12) transition guidance for sales and leaseback transactions; (13) impairment of net investment in the lease, (14) unguaranteed residual assets, (15) effect of initial direct costs on the rate implicit in the lease, and (16) failed sale and leaseback transactions. For public companies, these amendments will be applied for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We expect the standard to have a significant impact on our consolidated balance sheet, but not in our consolidated statement of earnings. The most significant impact will be the recognition of right-of-use assets and lease liabilities for operating leases. The Company will adopt the standard in the first quarter of 2019 and is currently compiling an inventory of arrangements containing a lease and accumulating the lease data necessary to apply the amended guidance. In addition, the Company will implement updates to its control processes and procedures, as necessary, based on changes resulting from the new standard. On July 16, 2018, the FASB issued guidance Codification Improvements which represents changes to clarify, correct errors in, or make minor improvements to the Codification. The change addresses conflicts or unclear intent in the following areas: (1) Comprehensive Income – Overall, (2) Debt – Modifications and Extinguishments, (3) Distinguishing Liabilities from Equity – Overall, (3) Compensation – Stock Compensation – Income Taxes, (4) Derivatives and Hedging – Overall – Other Presentation Matters, (5) Fair Value Measurement – Overall and (6) Financial Services – Brokers and Dealers – Liabilities and Financial Services – Depository and Lending. Some of the amendments in this update do not require transition guidance and are effective immediately. However, many of the amendments do have transition guidance, effective for public companies for annual periods beginning after December 15, 2018. We are currently evaluating the impact the adoption of this guidance may have on the Company’s consolidated financial statements. Recently Adopted Accounting Standards On February 28, 2018, the FASB issued guidance for Technical Corrections and Improvement to Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities. Areas for correction or improvement include (1) equity securities without a readily determinable fair value—discontinuation, (2) equity securities without a readily determinable fair value—adjustments, (3) forward contracts and purchased options, (4) presentation requirements for certain fair value option liabilities, (5) fair value option liabilities denominated in a foreign currency, and (6) transition guidance for equity securities without a readily determinable fair value. For public companies, these amendments, became effective on a prospective basis, for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Public entities with fiscal years beginning between December 15, 2017 and June 15, 2018 are not required to adopt these amendments until the interim period beginning after June 15, 2018. The Company adopted this guidance effective June 30, 2018. The adoption of this guidance did not have a material impact on the presentation of the Company’s consolidated result of operations. On January 5, 2016, the FASB issued guidance to enhance the reporting model for financial instruments to provide users of financial statements with more decision-useful information. Among the many targeted improvements to U.S. GAAP are (1) requiring equity investments, except those accounted for under the equity method of accounting or those that result in consolidation of the investee, to be measured at fair value with changes in fair value recognized in net income; (2) simplifying the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (3) eliminating the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities; and (4) clarifying that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. This guidance applies to all entities that hold financial assets or owe financial liabilities. The Company also adopted guidance issued by FASB on March 9, 2018 that removes the previous guidance for Other Than Temporary Impairment of Certain Investments in Equity Securities as required by SEC Staff Accounting Bulletin (SAB) No. 117 and SEC Release No. 33-9273, since it is no longer applicable. For public companies, these amendments became effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted this guidance for equity securities effective January 1, 2018. A cumulative-effect adjustment of $39,882 was made from accumulated other comprehensive income to the beginning retained earnings at the implementation date. Other than the accounting pronouncements disclosed above, there were no other new accounting pronouncements issued during the three months and nine months ended September 30, 2018 that could have a material impact on the Corporation’s financial position, operating results or financials statement disclosures. |
Investment in Securities
Investment in Securities | 9 Months Ended |
Sep. 30, 2018 | |
Investment in Securities [Abstract] | |
Investment in Securities | (3) Investment in Securities The amortized cost for debt securities and cost for equity securities, gross unrealized gains, gross unrealized losses, and estimated fair value for the Company’s investments in securities by major security type and class of security at 30, 2018 and December 31, 2017, were as follows: September 30, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Fixed maturities available for sale: Obligations of government- sponsored enterprises $ 11,460 $ - $ (130 ) $ 11,330 U.S. Treasury securities and obligations of U.S. government instrumentalities 225,968 11 (1,488 ) 224,491 Obligations of the Commonwealth of Puerto Rico and its instrumentalities 8,234 - (5 ) 8,229 Municipal securities 679,796 13,967 (4,521 ) 689,242 Corporate bonds 213,048 9,525 (1,007 ) 221,566 Residential mortgage-backed securities 59,483 - (987 ) 58,496 Collateralized mortgage obligations 11,054 - (358 ) 10,696 Total fixed maturities available for sale $ 1,209,043 $ 23,503 $ (8,496 ) $ 1,224,050 September 30, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Fixed maturities held to maturity: U.S. Treasury securities and obligations of U.S. government instrumentalities $ 617 $ 107 $ - $ 724 Residential mortgage-backed securities 190 3 - 193 Certificates of deposit 1,683 - - 1,683 Total $ 2,490 $ 110 $ - $ 2,600 September 30, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Equity investments - Mutual funds $ 267,852 $ 39,518 $ (1,010 ) $ 306,360 September 30, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Other invested assets - Alternative investments $ 71,479 $ 1,950 $ (302 ) $ 73,127 December 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Securities available for sale: Fixed maturities: Obligations of government- sponsored enterprises $ 1,431 $ 13 $ - $ 1,444 U.S. Treasury securities and obligations of U.S. government instrumentalities 118,858 41 (550 ) 118,349 Obligations of the Commonwealth of Puerto Rico and its instrumentalities 8,059 34 - 8,093 Municipal securities 771,789 30,468 (1,467 ) 800,790 Corporate bonds 217,046 17,767 (489 ) 234,324 Residential mortgage-backed securities 32,465 2 (355 ) 32,112 Collateralized mortgage obligations 22,003 10 (337 ) 21,676 Total fixed maturities 1,171,651 48,335 (3,198 ) 1,216,788 Equity securities: Mutual funds 292,460 50,072 (223 ) 342,309 Alternative investments 34,669 559 (244 ) 34,984 Total equity securities 327,129 50,631 (467 ) 377,293 Total $ 1,498,780 $ 98,966 $ (3,665 ) $ 1,594,081 December 31, 2017 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Securities held to maturity: U.S. Treasury securities and obligations of U.S. government instrumentalities $ 617 $ 154 $ - $ 771 Residential mortgage-backed securities 191 2 - 193 Certificates of deposit 1,511 - - 1,511 Total $ 2,319 $ 156 $ - $ 2,475 Gross unrealized losses on investment securities and the estimated fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of 30, 2018 and December 31, 2017 were as follows: September 30, 2018 Less than 12 months 12 months or longer Total Estimated Fair Value Gross Unrealized Loss Number of Securities Estimated Fair Value Gross Unrealized Loss Number of Securities Estimated Fair Value Gross Unrealized Loss Number of Securities Fixed maturities available for sale: Obligations of government- $ 11,330 $ (130 ) 2 $ - $ - - $ 11,330 $ (130 ) 2 U.S. Treasury securities and 196,342 (1,488 ) 21 - - - 196,342 (1,488 ) 21 Obligations of the Commonwealth 7,485 (5 ) 4 - - - 7,485 (5 ) 4 Municipal securities 306,834 (3,727 ) 56 23,631 (794 ) 2 330,465 (4,521 ) 58 Corporate bonds 128,028 (1,007 ) 44 - - - 128,028 (1,007 ) 44 Residential mortgage-backed 53,395 (741 ) 21 5,100 (246 ) 4 58,495 (987 ) 25 Collateralized mortgage obligations 6,333 (148 ) 2 4,115 (210 ) 1 10,448 (358 ) 3 Total fixed maturities $ 709,747 $ (7,246 ) 150 $ 32,846 $ (1,250 ) 7 $ 742,593 $ (8,496 ) 157 Other invested assets - Alternative investments $ 13,460 $ (224 ) 5 $ 8,817 $ (78 ) 2 $ 22,277 $ (302 ) 7 December 31, 2017 Less than 12 months 12 months or longer Total Estimated Fair Value Gross Unrealized Loss Number of Securities Estimated Fair Value Gross Unrealized Loss Number of Securities Estimated Fair Value Gross Unrealized Loss Number of Securities Securites available for sale: Fixed maturities: U.S. Treasury securities and $ 96,617 $ (550 ) 7 $ - $ - - $ 96,617 $ (550 ) 7 Municipal securities 162,731 (1,467 ) 27 - - - 162,731 (1,467 ) 27 Corporate bonds 80,374 (489 ) 16 - - - 80,374 (489 ) 16 Residential mortgage-backed 31,736 (355 ) 19 - - - 31,736 (355 ) 19 Collateralized mortgage obligations 13,630 (239 ) 3 7,294 (98 ) 2 20,924 (337 ) 5 Total fixed maturities 385,088 (3,100 ) 72 7,294 (98 ) 2 392,382 (3,198 ) 74 Equity securities: Mutual funds 42,983 (223 ) 6 - - - 42,983 (223 ) 6 Alternative investments 9,986 (212 ) 5 3,162 (32 ) 1 13,148 (244 ) 6 Total equity securities 52,969 (435 ) 11 3,162 (32 ) 1 56,131 (467 ) 12 Total for securities available for sale $ 438,057 $ (3,535 ) 83 $ 10,456 $ (130 ) 3 $ 448,513 $ (3,665 ) 86 The Company reviews the available for sale and other invested assets portfolios under the Company’s impairment review policy. Given market conditions and the significant judgments involved, there is a continuing risk that declines in fair value may occur and material other-than-temporary impairments may be recorded in future periods. The Company from time to time may sell investments as part of its asset/liability management process or to reposition its investment portfolio based on current and expected market conditions. Obligations of Government-Sponsored Enterprises, U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities, and Municipal Securities: contractual cash flows, these investments are not considered other-than-temporarily impaired. Corporate Bonds : The unrealized losses of these bonds were principally caused by fluctuations in interest rates and general market conditions. All corporate bonds with an unrealized loss have investment grade ratings. Because the decline in estimated fair value is principally attributable to changes in interest rates; because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity; and because the Company expects to collect all contractual cash flows, these investments are not considered other-than-temporarily impaired. Residential mortgage-backed securities and Collateralized mortgage obligations Obligations of the Commonwealth of Puerto Rico and its Instrumentalities : Alternative Investments: Maturities of investment securities classified as available for sale and held to maturity were as follows: September 30, 2018 Amortized cost Estimated fair value Fixed maturities available for sale Due in one year or less $ 11,238 $ 11,263 Due after one year through five years 400,523 398,067 Due after five years through ten years 419,705 418,411 Due after ten years 307,040 327,117 Residential mortgage-backed securities 59,483 58,496 Collateralized mortgage obligations 11,054 10,696 $ 1,209,043 $ 1,224,050 Fixed maturities held to maturity Due in one year or less 1,683 1,683 Due after ten years 617 724 Residential mortgage-backed securities 190 193 $ 2,490 $ 2,600 Expected maturities may differ from contractual maturities because some issuers have the right to call or prepay obligations with or without call or prepayment penalties. Information regarding realized and unrealized gains and losses from investments is as follows: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Realized gains (losses) Fixed maturity securities: Securities available for sale: Gross gains $ 587 $ 933 2,099 $ 1,334 Gross losses (2,892 ) (194 ) (13,695 ) (830 ) Total fixed securities (2,305 ) 739 (11,596 ) 504 Equity investments: Gross gains 1,218 3,014 9,972 7,641 Gross losses (67 ) - (1,091 ) (2 ) Total equity investments 1,151 3,014 8,881 7,639 Other invested assets: Gross gains 311 - 4,104 - Gross losses (113 ) - (324 ) - Total other invested assets 198 - 3,780 - Net realized investment (losses) gains $ (956 ) $ 3,753 $ 1,065 $ 8,143 Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Changes in net unrealized (losses) gains: Recognized in accumulated other comprehensive (loss) income: Fixed maturities – available for sale $ (8,873 ) $ (1,199 ) $ (30,130 ) $ 1,614 Other invested assets 894 3,605 1,333 17,516 $ (7,979 ) $ 2,406 $ (28,797 ) $ 19,130 Not recognized in the consolidated financial statements: Fixed maturities – held to maturity $ (13 ) $ (2 ) $ (46 ) $ (10 ) The change in deferred tax liability on unrealized gains recognized in accumulated other comprehensive (loss) income during the nine months ended 30, 2018 and 2017 $ , respectively. As of 30, 2018 and December 31, 2017, no individual investment in securities exceeded 10% of stockholders’ equity. |
Premiums and Other Receivables,
Premiums and Other Receivables, Net | 9 Months Ended |
Sep. 30, 2018 | |
Premiums and Other Receivables, Net [Abstract] | |
Premiums and Other Receivables, Net | (4) Premiums and Other Receivables, Net Premiums and other receivables, net were as follows: September 30, 2018 December 31, 2017 Premium $ 73,624 $ 103,027 Self-funded group receivables 34,851 39,859 FEHBP 13,670 13,346 Agent balances 26,076 32,818 Accrued interest 12,243 14,331 Reinsurance recoverable 428,298 661,679 Other 84,460 70,150 673,222 935,210 Less allowance for doubtful receivables: Premium 31,379 26,490 Other 8,946 9,393 40,325 35,883 Total premium and other receivables, net $ 632,897 $ 899,327 As of September 30, 2018 and December 31, 2017, the Company had premiums and other receivables of $52,170 and $81,838, respectively, from the Government of Puerto Rico, including its agencies, municipalities and public corporations. The |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Measurements [Abstract] | |
Fair Value Measurements | (5) Fair Value Measurements Our condensed consolidated balance sheets include the following financial instruments: securities available for sale, equity investments, policy loans, policyholder deposits, and long-term borrowings. We consider the carrying amounts of policy loans, policyholder deposits, and long-term borrowings to approximate their fair value due to the short period of time between the origination of these instruments and the expected realization or payment. Certain assets are measured at fair value on a recurring basis and are disclosed below. These assets are classified into one of three levels of a hierarchy defined by GAAP. For a description of the methods and assumptions that are used to estimate the fair value and determine the fair value hierarchy classification of each class of financial instrument, see the consolidated financial statements and notes thereto included in our 2017 Annual Report on Form 10-K. The following tables summarize fair value measurements by level for assets measured at fair value on a recurring basis: September 30, 2018 Level 1 Level 2 Level 3 Total Fixed maturity securities available for sale: Obligations of government-sponsored enterprises $ - $ 11,330 $ - $ 11,330 U.S. Treasury securities and obligations of U.S government instrumentalities 224,491 - - 224,491 Obligations of the Commonwealth of Puerto Rico and its instrumentalities - 8,229 - 8,229 Municipal securities - 689,242 - 689,242 Corporate bonds - 221,566 - 221,566 Residential agency mortgage-backed securities - 58,496 - 58,496 Collateralized mortgage obligations - 10,696 - 10,696 Total fixed maturities 224,491 999,559 - 1,224,050 Equity investments $ 143,638 $ 162,722 $ - $ 306,360 December 31, 2017 Securities available for sale: Level 1 Level 2 Level 3 Total Fixed maturity securities: Obligations of government-sponsored enterprises $ - $ 1,444 $ - $ 1,444 U.S. Treasury securities and obligations of U.S government instrumentalities 118,349 - - 118,349 Obligations of the Commonwealth of Puerto Rico and its instrumentalities - 8,093 - 8,093 Municipal securities - 800,790 - 800,790 Corporate bonds - 234,324 - 234,324 Residential agency mortgage-backed securities - 32,112 - 32,112 Collateralized mortgage obligations - 21,676 - 21,676 Total fixed maturities 118,349 1,098,439 - 1,216,788 Equity securities - Mutual funds 193,160 149,149 - 342,309 Alternative investments - measured at net asset value - - - 34,984 Total equity securities 193,160 149,149 - 377,293 Total $ 311,509 $ 1,247,588 $ - $ 1,594,081 There were no transfers between Levels 1 and 2 during the three months and nine months ended 30, 2018 and 2017. A summary of the carrying value and fair value by level of financial instruments not recorded at fair value on our condensed consolidated balance sheets at 30, 2018 and December 31, 2017 are as follows: September 30, 2018 Carrying Fair Value Value Level 1 Level 2 Level 3 Total Assets: Policy loans $ 9,680 $ - $ 9,680 $ - $ 9,680 Liabilities: Policyholder deposits $ 174,126 $ - $ 174,126 $ - $ 174,126 Long-term borrowings: Loans payable to bank - variable 29,924 - 29,924 - 29,924 Total liabilities $ 204,050 $ - $ 204,050 $ - $ 204,050 December 31, 2017 Carrying Fair Value Value Level 1 Level 2 Level 3 Total Assets: Policy loans $ 9,077 $ - $ 9,077 $ - $ 9,077 Liabilities: Policyholder deposits $ 176,534 $ - $ 176,534 $ - $ 176,534 Long-term borrowings: Loans payable to bank - variable 32,350 - 32,350 - 32,350 Total liabilities $ 208,884 $ - $ 208,884 $ - $ 208,884 |
Claim Liabilities
Claim Liabilities | 9 Months Ended |
Sep. 30, 2018 | |
Claim Liabilities [Abstract] | |
Claim Liabilities | (6) Claim Liabilities A reconciliation of the beginning and ending balances of claim liabilities is as follows: Nine months ended September 30, 2018 Managed Care Other Business Segments * Consolidated Claim liabilities at beginning of period $ 367,357 $ 739,519 $ 1,106,876 Reinsurance recoverable on claim liabilities - (633,099 ) (633,099 ) Net claim liabilities at beginning of period 367,357 106,420 473,777 Claims incurred: Current period insured events 1,764,038 80,774 1,844,812 Prior period insured events (30,404 ) 122,951 92,547 Total 1,733,634 203,725 1,937,359 Payments of losses and loss-adjustment expenses: Current period insured events 1,438,611 40,317 1,478,928 Prior period insured events 249,073 40,621 289,694 Total 1,687,684 80,938 1,768,622 Net claim liabilities at end of period 413,307 229,207 642,514 Reinsurance recoverable on claim liabilities - 395,600 395,600 Claim liabilities at end of period $ 413,307 $ 624,807 $ 1,033,114 * Other Business Segments include the Life Insurance and Property and Casualty segments, as well as intersegment eliminations. Nine months ended September 30, 2017 Managed Care Other Business Segments * Consolidated Claim liabilities at beginning of period $ 349,047 $ 138,896 $ 487,943 Reinsurance recoverable on claim liabilities - (38,998 ) (38,998 ) Net claim liabilities at beginning of period 349,047 99,898 448,945 Claims incurred: Current period insured events 1,724,890 95,227 1,820,117 Prior period insured events (19,158 ) (5,920 ) (25,078 ) Total 1,705,732 89,307 1,795,039 Payments of losses and loss-adjustment expenses: Current period insured events 1,456,098 38,222 1,494,320 Prior period insured events 242,384 35,325 277,709 Total 1,698,482 73,547 1,772,029 Net claim liabilities at end of period 356,297 115,658 471,955 Reinsurance recoverable on claim liabilities - 636,743 636,743 Claim liabilities at end of period $ 356,297 $ 752,401 $ 1,108,698 * Other Business Segments include the Life Insurance and Property and Casualty segments, as well as intersegment eliminations. The actual amounts of claims incurred in connection with insured events occurring in a prior period typically differ from estimates of such claims made in the prior period. Amounts included as incurred claims for prior period insured events reflect the aggregate net amount of these differences. The unfavorable developments in the claims incurred and loss-adjustment expenses for prior period insured events for the nine months ended September 30, 2018 is driven by an adverse development of approximately $128,707 in losses related to Hurricane Maria, offset by better than expected utilization trends in the Managed Care segment. The favorable developments in the claims incurred and loss-adjustment expenses for prior period insured events for the nine months ended September 30, 2017 are due primarily to better than expected utilization trends in the Managed Care segment. Reinsurance recoverable on unpaid claims is reported as premium and other receivables, net in the accompanying condensed consolidated financial statements. Claim liabilities as of September 30, 2018 include approximately $488,180 related to the impact of Hurricane María, which made landfall in Puerto Rico in September 2017. The claims incurred disclosed in this table exclude the portion of the change in the liability for future policy benefits expense, which amounted to $22,348 during the nine months ended September 30, 2018. The change in the liability for future policy benefits during the nine months ended September 30, 2017 amounted to $20,746. The following is information about total incurred but not reported (IBNR) liabilities plus expected development on reported claims included in the liability for unpaid claims adjustment expenses for the Managed Care segment as of 30, 2018. Incurred Year Total of IBNR Liabilities Plus Expected Development on Reported Claims 2017 $ 11,965 2018 325,427 |
Pension Plan
Pension Plan | 9 Months Ended |
Sep. 30, 2018 | |
Pension Plan [Abstract] | |
Pension Plan | (7) Pension Plan The components of net periodic benefit cost were as follows: Three months ended September 30, Nine months ended September 30, Components of net periodic benefit cost: 2018 2017 2018 2017 Interest cost $ 1,713 $ 1,652 $ 5,099 $ 5,248 Expected return on assets (2,255 ) (2,021 ) (6,817 ) (6,419 ) Amortization of actuarial loss 240 79 670 251 Settlement loss 395 580 1,045 1,211 Net periodic benefit cost $ 93 $ 290 $ (3 ) $ 291 Employer Contributions: The Company disclosed in its audited consolidated financial statements for the year ended December 31, 2017 that it expected to contribute $2,000 to the pension program in 2018. As of 30, 2018, the Company has contributed $2,000 to the pension program. |
Reinsurance
Reinsurance | 9 Months Ended |
Sep. 30, 2018 | |
Reinsurance [Abstract] | |
Reinsurance | (8) Reinsurance Triple-S Propiedad, Inc. (TSP) uses facultative reinsurance, pro rata, and excess of loss reinsurance treaties to manage its exposure to losses, including those from catastrophe events. TSP has geographic exposure to catastrophe losses from hurricanes and earthquakes. The incidence and severity of catastrophes are inherently unpredictable. Under these treaties, TSP ceded premiums written were $12,658 and $13,370 for the three months ended September 30, 2018 and 2017, respectively, and $40,124 and $40,091 for the nine months ended September 30, 2018, and 2017, respectively. During the nine months ended September 30, 2018 and 2017, TSP ceded claims incurred amounting to $153,707 and $603,893, respectively, related to losses caused by Hurricanes Irma and Maria. Principal reinsurance agreements are as follows: · Casualty excess of loss treaty provides reinsurance for losses up to $12,000, subject to a retention of $225. · Medical malpractice excess of loss treaty provides reinsurance for losses up to $3,000, subject to a retention of $150. · Property reinsurance treaty includes proportional cessions and a per risk excess of loss contract limiting losses to $350 in $30,000 risks. · Catastrophe protection is purchased limiting losses to $10,000 per event with losses up to approximately $915,000. All principal reinsurance contracts are for a period of one year and are subject to modifications and negotiations in each renewal. TSP’s current property and catastrophe reinsurance program was renewed effective April 1, 2018 for a twelve months period ending March 31, 2019. Other contracts were renewed as expiring on January 1, 2018. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Taxes [Abstract] | |
Income Taxes | (9) Income Taxes The net deferred tax asset at September 30, 2018 and December 31, 2017 of the Company and its subsidiaries is composed of the following: September 30, 2018 December 31, 2017 Deferred tax assets Gross deferred tax assets $ 127,563 $ 87,058 Less: valuation allowance (12,696 ) (8,283 ) Deferred tax assets 114,867 78,775 Deferred tax liabilities Gross deferred tax liabilities (34,485 ) (35,543 ) Net deferred tax asset $ 80,382 $ 43,232 The net deferred tax asset shown in the table above at September 30, 2018 and December 31, 2017 is reflected in the consolidated balance sheets as $83,593 and $65,123, respectively, in deferred tax assets and $3,210 and $21,891, in deferred tax liabilities, respectively, reflecting the aggregate deferred tax assets or liabilities of individual tax-paying subsidiaries of the Company, because under Puerto Rico income tax law, the Company is not allowed to file consolidated tax returns with its subsidiaries. At September 30, 2018, the Company and its subsidiaries have net operating loss carry-forwards for Puerto Rico income tax purposes of approximately $169,000, which are available to offset future taxable income for up to December 2028. The carryforwards generally expire in 2026 through 2028. The valuation allowance is mostly related to the net operating losses generated by the Company’s U.S. Virgin Islands (USVI), the health's clinic's operations, and the Property and Casualty segment losses related to hurricane Maria that based on the available evidence are not considered to be realizable at the reporting dates. Except for the valuation allowance, the Company concluded that as of September 30, 2018, it is more likely than not that the entities that have these net operating loss carry-forwards will generate sufficient taxable income within the applicable net operating loss carry-forward periods to realize its deferred tax asset. This conclusion is based on the historical results of each entity, adjusted to exclude non-recurring conditions, and the forecast of future profitability. Management will continue to evaluate, on a quarterly basis, if there are any significant events that will affect the Company’s ability to utilize these deferred tax assets. . |
Comprehensive Income (Loss)
Comprehensive Income (Loss) | 9 Months Ended |
Sep. 30, 2018 | |
Comprehensive Income (Loss) [Abstract] | |
Comprehensive Income (Loss) | (10) Comprehensive Income (Loss) The accumulated balances for each classification of other comprehensive income (loss), net of tax, are as follows: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Net Unrealized Gain on Securities Beginning Balance $ 21,260 $ 75,239 $ 76,238 $ 62,371 Unrealized loss reclassified to beginning retained earnings as a result of implementation new accounting pronouncement - - (39,882 ) - Other comprehensive (loss) income before reclassifications (6,981 ) 4,853 (20,460 ) 21,233 Amounts reclassified from accumulated other comprehensive income (loss) 765 (3,002 ) (852 ) (6,514 ) Net current period change (6,216 ) 1,851 (21,312 ) 14,719 Ending Balance 15,044 77,090 15,044 77,090 Liability for Pension Benefits Beginning Balance (24,722 ) (19,870 ) (24,984 ) (19,976 ) Amounts reclassified from accumulated other comprehensive income 147 48 409 154 Ending Balance (24,575 ) (19,822 ) (24,575 ) (19,822 ) Accumulated Other Comprehensive (Loss) Income Beginning Balance (3,462 ) 55,369 51,254 42,395 Unrealized loss reclassified to beginning retained earnings as the result of implementing new accounting pronouncement - - (39,882 ) - Other comprehensive (loss) income before reclassifications (6,981 ) 4,853 (20,460 ) 21,233 Amounts reclassified from accumulated other comprehensive income (loss) 912 (2,954 ) (443 ) (6,360 ) Net current period change (6,069 ) 1,899 (20,903 ) 14,873 Ending Balance $ (9,531 ) $ 57,268 $ (9,531 ) $ 57,268 |
Stock Repurchase Program
Stock Repurchase Program | 9 Months Ended |
Sep. 30, 2018 | |
Stock Repurchase Program [Abstract] | |
Stock Repurchase Programs | (11) Stock Repurchase Program The Company repurchases shares through open-market purchases of Class B shares only, in accordance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended, under repurchase programs authorized by the Board of Directors. In August 2017, the Company’s Board of Directors authorized a $30,000 repurchase program of its Class B common stock, and in February 2018 the Company’s Board of Directors authorized a $25,000 expansion of this program. During the three months ended 30, 2018, the Company repurchased and retired under this program 259,925 shares at an average per share price of $23.06, for an aggregate cost of $5,995. During the nine months ended 30, 2018, the Company repurchased and retired under this program 903,888 shares at an average per share price of $24.76, for an aggregate cost of $22,390. |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Sep. 30, 2018 | |
Share-Based Compensation [Abstract] | |
Share-Based Compensation | (12) Share-Based Compensation Share-based compensation expense recorded during the three months ended 30, 2018 and 2017 was $919 and $1,481, respectively. Share-based compensation expense recorded during the nine months ended 30, 2018 and 2017 was $3,462 and $1,651, respectively. ended 30, 2018, 24,796 shares were repurchased and retired as the result of non-cash tax withholdings upon vesting of shares. There were no non-cash tax withholdings during the nine months ended 30, 2017. |
Net (Loss) Income Available to
Net (Loss) Income Available to Stockholders and Net (Loss) Income per Share | 9 Months Ended |
Sep. 30, 2018 | |
Net (Loss) Income Available to Stockholders and Net (Loss) Income per Share [Abstract] | |
Net (Loss) Income Available to Stockholders and Net (Loss) Income per Share | (13) Net (Loss) Income Available to Stockholders and Net (Loss) Income per Share The following table sets forth the computation of basic and diluted earnings per share: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Numerator for earnings per share: Net (loss) income attributable to TSM available to stockholders $ (17,567 ) $ 21,912 $ (52,400 ) $ 30,275 Denominator for basic earnings per share: Weighted average of common shares 22,895,582 24,142,192 23,058,754 24,177,344 Effect of dilutive securities - 65,830 - 54,364 Denominator for diluted earnings per share 22,895,582 24,208,022 23,058,754 24,231,708 Basic net (loss) income per share attributable to TSM $ (0.77 ) $ 0.91 $ (2.27 ) $ 1.25 Diluted net (loss) income per share attributable to TSM $ (0.77 ) $ 0.91 $ (2.27 ) $ 1.25 The Company excluded the effect of dilutive securities during the three months nine months ended September 30, 2018 because their effect would have been anti-dilutive given the net loss attributable to stockholders in the period. If the Company had generated income from continuing operations during the three months ended and nine months ended September 30, 2018, the effect of restricted stock awards on the diluted shares calculation would have been an increase in shares of 75,986 and 92,076 shares, respectively. |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Contingencies [Abstract] | |
Contingencies | (14) Contingencies The following information supplements and amends, as applicable, the disclosures in Note 23 to the Consolidated Financial Statements of the Company’s 2017 Annual Report on Form 10-K. Our business is subject to numerous laws and regulations promulgated by Federal, Puerto Rico, USVI, Costa Rica, British Virgin Islands (BVI), and Anguilla governmental authorities. Compliance with these laws and regulations can be subject to government review and interpretation, as well as regulatory actions unknown and unasserted at this time. The Commissioner of Insurance of Puerto Rico, as well as other Federal, Puerto Rico, USVI, Costa Rica, BVI, and Anguilla government authorities, regularly make inquiries and conduct audits concerning the Company's compliance with such laws and regulations. Penalties associated with violations of these laws and regulations may include significant fines and exclusion from participating in certain publicly funded programs and may require the Company to comply with corrective action plans or changes in our practices. We are involved in various legal actions arising in the ordinary course of business. We are also defendants in various other litigations and proceedings, some of which are described below. Where the Company believes that a loss is both probable and estimable, such amounts have been recorded. Although we believe our estimates of such losses are reasonable, these estimates could change as a result of further developments in these matters. In other cases, it is at least reasonably possible that the Company may incur a loss related to one or more of the mentioned pending lawsuits or investigations, but the Company is unable to estimate the range of possible loss which may be ultimately realized, either individually or in the aggregate, upon their resolution. The outcome of legal proceedings is inherently uncertain and pending matters for which accruals have not been established have not progressed sufficiently to enable us to estimate a range of possible loss, if any. Given the inherent unpredictability of these matters, it is possible that an adverse outcome in one or more of these matters could have a material adverse effect on the consolidated financial condition, operating results and/or cash flows of the Company. Additionally, we may face various potential litigation claims that have not been asserted to date, including claims from persons purporting to have rights to acquire shares of the Company on favorable terms pursuant to agreements previously entered by our predecessor managed care subsidiary, Seguros de Servicios de Salud de Puerto Rico, Inc. (SSS), with physicians or dentists who joined our provider network to sell such new provider shares of SSS at a future date (Share Acquisition Agreements) or to have inherited such shares notwithstanding applicable transfer and ownership restrictions. Claims by Heirs of Former Shareholders On August 28, 2017, local Court of First Instance entered summary judgement in Heirs of Dr. Juan Acevedo, et al., v. Triple-S Management Corporation, et al. ordering the Company to issue 63,000 stock shares in favor of Plaintiffs, plus costs and legal fees. The Company appealed said judgement and on March 15, 2018, Puerto Rico Court of Appeals revoked said judgement and ruled in favor of the Company dismissing the complaint with prejudice. On June 1, 2018, the Puerto Rico Supreme Court denied Plaintiffs’ petition for a Writ of Certiorari; a request for reconsideration has been denied by the Puerto Rico Supreme Court, thus the Court of Appeals Sentence in favor of the Company is final. On September 20, 2018, local Court of First Instance entered partial summary judgement in Wanda Irizarry Antonmattei, et al., v. Seguros de Servicios de Salud de Puerto Rico, Inc., et al. ordering the Company to issue 63,000 stock shares in favor of Plaintiffs. The Company filed for reconsideration of said judgement; and will appeal if necessary. In re Blue Cross Blue Shield Antitrust Litigation TSS is a co-defendant with multiple Blue Plans and the Blue Cross Blue Shield Association (BCBSA) in a multi-district class action litigation filed by a group of providers and subscribers on July 24, 2012 and October 1, 2012, respectively, that has since been consolidated by the United States District Court for the Northern District of Alabama, Southern Division, in the case captioned In re Blue Cross Blue Shield Association Antitrust Litigation quid pro quo Prior to consolidation, motions to dismiss were filed by several plans, including TSS - whose request was ultimately denied by the court without prejudice. On April 6, 2015, plaintiffs filed suit in the United States District Court of Puerto Rico against TSS. Said complaint, nonetheless, is believed not to preclude TSS’ jurisdictional arguments. Since inception, the Company has joined BCBSA and other Blue Plans in vigorously contesting these claims. On April 5, 2018, the United States District Court for the Northern District of Alabama, Southern Division, Per Se Per Se Rule of Reason As a result, the joint defense group obtained certification of the standard of review decision, and on July 9, 2018 appealed the matter to the 11th Circuit. Presently, the case is in a “holding pattern” until the 11 th If successful, plaintiffs would be entitled to recover treble damages plus attorneys’ fees, costs and expenses. In addition, the challenged practice would likely be enjoined nationwide. Even if class certification is denied, any one plaintiff could still challenge the entire system and seek the same broad relief as the current putative classes. An injunction in favor of a single plaintiff could likely apply to the entire system. Damages experts have yet to issue damage estimates. Estimates of potential exposure towards providers, after trebling, exceed $15 billion. Potential trebled damages towards subscribers are close to $150 million. Possibilities of success are difficult to predict globally and are contingent on whether the Per Se Claims Relating to the Provision of Health Care Services TSS was a defendant in several claims for collection of monies in connection with the provision of health care services. Among them are individual complaints filed before ASES by six community health centers alleging TSS breached their contracts with respect to certain capitation payments and other monetary claims. In May 2018, the Company settled this case with all six community health centers and paid a settlement agreement totaling $1,200. ASES Audits The Company is subject to audits in connection with the provision of services to private and governmental entities. These audits may include numerous aspects of our business, including claim payment practices, contractual obligations, service delivery, third-party obligations, and business practices, among others. Deficiencies in audits could have a material adverse effect on our reputation and business, including termination of contracts, significant increases in the cost of managing and remediating deficiencies, payment of contractual penal clauses, and others, any of which could have a material and adverse effect on our results of operations, financial position and cash flows. On July 2, 2014, ASES notified TSS that the results of an audit conducted in connection with the government health plan contract for several periods between October 2005 and September 2013, reflected an overpayment of premiums made to TSS pursuant to prior contracts with ASES in the amount of $7,900. The alleged overpayments were related to duplicated payments or payments made for deceased members, and ASES requested the reimbursement of the alleged overpayment. On January 16, 2015, TSS filed an injunction against ASES under the case Triple-S Salud, Inc. v. Administración de Seguros de Salud de Puerto Rico. TSS contends that ASES’ request for reimbursement has no merits on several grounds, including a 2011 settlement between both parties covering the majority of the amount claimed by ASES, and that ASES, under the terms of the contracts, was responsible for certifying the membership. On May 26, 2017, the court issued a partial judgement dismissing the complaint in favor of TSS with respect to the alleged overpayments for the period between October 2005 and September 2010, which represented approximately $7,400 of the total alleged claim. On July 27, 2017, ASES appealed the court’s partial judgement and on January 31, 2018, the Puerto Rico Court of Appeals entered judgement in favor of the Company, thus validating the 2011 settlement agreement. No plea for reconsideration nor a writ of certiorari was filed by ASES before the Court of Appeals or the Puerto Rico Supreme Court. The parties reached a settlement agreement for the remaining $500 in controversy subject to the final approval of ASES Board of Directors, which has been accrued as of September 30, 2018. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2018 | |
Segment Information [Abstract] | |
Segment Information | (15) Segment Information The operations of the Corporation are conducted principally through three business segments: Managed Care, Life Insurance, and Property and Casualty Insurance. The Corporation evaluates performance based primarily on the operating revenues and operating income of each segment. Operating revenues include premiums earned, net, administrative service fees, net investment income, and revenues derived from other segments. Operating costs include claims incurred and operating expenses. The Corporation calculates operating income or loss as operating revenues less operating costs. The following tables summarize the operations by reportable segment for the three months and nine months ended 30, 2018 and 2017: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Operating revenues: Managed Care: Premiums earned, net $ 680,393 $ 653,734 $ 2,044,989 $ 1,955,246 Administrative service fees 3,802 3,391 11,216 12,318 Intersegment premiums/service fees 1,390 1,781 4,061 4,946 Net investment income 6,776 4,097 17,547 12,135 Total managed care 692,361 663,003 2,077,813 1,984,645 Life Insurance: Premiums earned, net 42,049 40,845 124,318 121,001 Intersegment premiums 235 107 832 409 Net investment income 6,428 6,070 19,105 18,487 Total life insurance 48,712 47,022 144,255 139,897 Property and Casualty Insurance: Premiums earned, net 20,003 19,746 66,662 62,962 Intersegment premiums 153 153 460 460 Net investment income 2,518 2,106 7,724 6,164 Total property and casualty insurance 22,674 22,005 74,846 69,586 Other segments: * Intersegment service revenues (5 ) 2,796 283 6,641 Operating revenues from external sources 1,575 976 4,234 3,130 Total other segments 1,570 3,772 4,517 9,771 Total business segments 765,317 735,802 2,301,431 2,203,899 TSM operating revenues from external sources 446 87 1,254 220 Elimination of intersegment premiums/service fees (1,778 ) (2,041 ) (5,073 ) (5,535 ) Elimination of intersegment service revenues 5 (2,796 ) (283 ) (6,641 ) Consolidated operating revenues $ 763,990 $ 731,052 $ 2,297,329 $ 2,191,943 * Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic. Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Operating income (loss): Managed care $ 14,229 $ 34,819 $ 26,264 $ 19,157 Life insurance 5,681 4,477 14,637 13,402 Property and casualty insurance (46,880 ) (11,115 ) (114,820 ) (5,273 ) Other segments * 288 373 890 517 Total business segments (26,682 ) 28,554 (73,029 ) 27,803 TSM operating revenues from external sources 446 87 1,254 220 TSM unallocated operating expenses (1,780 ) (2,759 ) (6,575 ) (7,876 ) Elimination of TSM intersegment charges 2,400 2,400 7,200 7,200 Consolidated operating (loss) income (25,616 ) 28,282 (71,150 ) 27,347 Consolidated net realized investment (losses) gains (956 ) 3,753 1,065 8,143 Consolidated net unrealized investment losses on equity investments 5,632 - (11,343 ) - Consolidated interest expense (2,000 ) (1,709 ) (5,515 ) (5,116 ) Consolidated other income, net 1,943 3,409 3,600 6,521 Consolidated (loss) income before taxes $ (20,997 ) $ 33,735 $ (83,343 ) $ 36,895 Depreciation and amortization expense: Managed care $ 2,214 $ 2,567 $ 7,659 $ 7,455 Life insurance 272 315 868 913 Property and casualty insurance 89 136 301 388 Other segments* 175 166 515 489 Total business segments 2,750 3,184 9,343 9,245 TSM depreciation expense 197 197 590 590 Consolidated depreciation and amortization expense $ 2,947 $ 3,381 $ 9,933 $ 9,835 * Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic. September 30, 2018 December 31, 2017 Assets: Managed care $ 1,130,401 $ 1,092,715 Life insurance 852,750 853,289 Property and casualty insurance 762,705 1,094,773 Other segments * 20,787 19,027 Total business segments 2,766,643 3,059,804 Unallocated amounts related to TSM: Cash, cash equivalents, and investments 59,496 81,169 Property and equipment, net 21,326 22,257 Other assets 23,547 22,763 104,369 126,189 Elimination entries-intersegment receivables and others (52,584 ) (69,228 ) Consolidated total assets $ 2,818,428 $ 3,116,765 * Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | (16) Subsequent Events On November 2, 2018 TSP entered into a multi-year high excess cover reinsurance agreement that includes both retroactive and prospective covers. The agreement is effective from April 1, 2018 until March 31, 2023. The Company will account for this agreement in accordance with the provisions of Accounting Standards Codification 944 Financial Services – Insurance (ASC 944). Included in ASC 944 is specific guidance on accounting for reinsurance of short-duration and long duration reinsurance contracts (formerly Statement of Financial Accounting Standards (SFAS) 113, as amended). The retroactive portion is an adverse development reinsurance cover (ADC) providing for a coverage of $50,000 in excess of $76,500 of net losses, representing the adverse development related to Hurricane Maria experienced as of June 30, 2018. The Company expects to record in its consolidated balance sheet a reinsurance recoverable equal to the adverse development related to Hurricane Maria claims in excess of the $76,500 million of net incurred losses up to the $50,000 excess, a premium payable for the premium allocated to the retroactive cover, and a liability for a deferred gain on retroactive reinsurance. The reinsurance asset and liability will be released as the underlying recoveries are realized. The prospective portion of the agreement provides catastrophe umbrella coverage for a five-year period ending March 31, 2023 and should be recognized into operations based on the coverage period. The Company evaluated subsequent events through the date the condensed consolidated financial statements were issued. No events, other than those described in these notes, have occurred that require adjustment or disclosure pursuant to current Accounting Standards Codification. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | The accompanying condensed consolidated interim financial statements prepared by Triple-S Management Corporation and its subsidiaries are unaudited. In this filing, the “Corporation”, the “Company”, “TSM”, “we”, “us” and “our” refer to Triple-S Management Corporation and its subsidiaries. The condensed consolidated interim financial statements do not include all the information and the footnotes required by accounting principles generally accepted in the United States of America (GAAP or U.S. GAAP) for complete financial statement presentation. These condensed consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements included in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2017. In the opinion of management, all adjustments, consisting of a normal recurring nature necessary for a fair presentation of such condensed consolidated interim financial statements, have been included. The results of operations for the three months and nine months ended 30, 2018 are not necessarily indicative of the results for the full year ending December 31, 2018. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Significant Accounting Policies [Abstract] | |
Investments | Investments Fixed maturities and other invested assets Investment in debt securities at September 30, 2018 and December 31, 2017 consists mainly of obligations of government‑sponsored enterprises, U.S. Treasury securities and obligations of U.S. government instrumentalities, municipal securities, corporate bonds, residential mortgage-backed securities, and collateralized mortgage obligations. The Company classifies its debt securities in one of two categories: available-for-sale or held-to-maturity. Securities classified as held-to-maturity are those securities in which the Company has the ability and intent to hold until maturity. All other securities not included in held-to-maturity are classified as available-for-sale. Available-for-sale securities are recorded at fair value. The fair values of debt securities (both available-for-sale and held-to-maturity investments) are based on quoted market prices for those or similar investments at the reporting date. Held-to-maturity debt securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums and discounts, respectively. Unrealized holding gains and losses, net of the related tax effect, on available-for-sale securities are excluded from earnings and are reported as a separate component of other comprehensive income until realized. Realized gains and losses from the sale of available-for-sale securities are included in earnings and are determined on a specific‑identification basis. Transfers of securities between categories are recorded at fair value at the date of transfer. Unrealized holding gains or losses associated with transfers of securities from held-to-maturity to available-for-sale are recorded as a separate component of other comprehensive income. The unrealized holding gains or losses included in the separate component of other comprehensive income for securities transferred from available-for-sale to held-to-maturity, are maintained and amortized into earnings over the remaining life of the security as an adjustment to yield in a manner consistent with the amortization or accretion of premium or discount on the associated security. If a fixed maturity security is in an unrealized loss position and the Company has the intent to sell the fixed maturity security, or it is more likely than not that the Company will have to sell the fixed maturity security before recovery of its amortized cost basis, the decline in value is deemed to be other-than-temporary and is recorded to other-than-temporary impairment losses recognized in earnings in the Company’s consolidated statements of earnings. For impaired fixed maturity securities that the Company does not intend to sell or it is more likely than not that such securities will not have to be sold, but the Company expects not to fully recover the amortized cost basis, the credit component of the other-than-temporary impairment is recognized in other-than-temporary impairment losses recognized in earnings in the Company’s consolidated statements of earnings and the non-credit component of the other-than-temporary impairment is recognized in other comprehensive income. Furthermore, unrealized losses entirely caused by non-credit related factors related to fixed maturity securities for which the Company expects to fully recover the amortized cost basis continue to be recognized in accumulated other comprehensive income. The credit component of an other-than-temporary impairment is determined by comparing the net present value of projected future cash flows with the amortized cost basis of the fixed maturity security. The net present value is calculated by discounting the Company’s best estimate of projected future cash flows at the effective interest rate implicit in the fixed maturity security at the date of acquisition. A decline in the fair value of any available-for-sale or held-to-maturity security below cost that is deemed to be other-than-temporary results in an impairment to reduce the carrying amount to fair value. The impairment is charged to earnings and a new cost basis for the security is established. To determine whether an impairment is other-than-temporary, the Company considers whether it has the ability and intent to hold the investment until a market price recovery and considers whether evidence indicating the cost of the investment is recoverable outweighs evidence to the contrary. Evidence considered in this assessment includes the reasons for the impairment, the severity and duration of the impairment, market conditions, changes in value subsequent to year-end, forecasted performance of the investee, and the general market condition in the geographic area or industry the investee operates in. Premiums and discounts are amortized or accreted over the life of the related held-to-maturity or available-for-sale security as an adjustment to yield using the effective interest method. Dividend and interest income are recognized when earned. The Company regularly invests in mortgaged-backed securities and other securities subject to prepayment and call risk. Significant changes in prevailing interest rates may adversely affect the timing and amount of cash flows on such securities. In addition, the amortization of market premium and accretion of market discount for mortgaged-backed securities is based on historical experience and estimates of future payment speeds on the underlying mortgage loans. Actual prepayment speeds may differ from original estimates and may result in material adjustments to amortization or accretion recorded in future periods. Other invested assets at 30, 2018 and December 31, 2017 consist mainly of alternative investments in partnerships which invest in several private debt and private equity funds. Total unfunded capital commitments for these positions as of 30, 2018 amounted to $88,691. The remaining average commitments period is approximately three years. Equity investments Investment in equity securities at September 30, 2018 and December 31, 2017 consists of mutual funds whose underlying assets are comprised of domestic equity securities, international equity securities and higher risk fixed income instruments. Equity investments are recorded at fair value. The fair values of equity investments are based on quoted market prices. Unrealized holding gains and losses, on equity investments are included in earnings. Realized gains and losses from the sale of equity investments are included in earnings and are determined on a specific‑identification basis. |
Recent Accounting Standards | Recent Accounting Standards On August 29, 2018, the Financial Accounting Standard Board (FASB) issued guidance for Intangibles – Goodwill and Other – Internal-Use Software. Guidance addresses customer’s accounting for implemented costs incurred in a cloud computing arrangement that is a service contract and aims to reduce complexity in the accounting for costs of implementing a cloud computing service arrangement. The amendments require a customer in a hosting arrangement that is a service contract to determine which implementation costs to capitalize as an asset related to service contract and which costs to expense. Additionally, it requires the customer to expense the capitalized implementation costs over the term of the hosting arrangement. For public companies, these amendments, will be applied on a prospective basis, for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The adoption of this guidance should not have a material impact on the presentation of the Company’s consolidated result of operations. On August 28, 2018, the FASB issued guidance for Compensation – Retirement Benefits – Defined Benefit Plans – General which addresses changes to the disclosure requirement for defined benefit plans. The amendments in this guidance modify the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. Specifically certain disclosure requirements are removed (i.e. the amounts of accumulated other comprehensive income expected to be recognized as components of net periodic benefit cost over the next fiscal year, related party disclosures concerning the amount of future annual benefits covered by an insurance and annuity contracts and significant transactions between the employer and related parties and the plan) while certain other disclosures are added (i.e. the weighted-average interest crediting rates for cash balance plans and other plans with promised interest crediting rates, an explanation for the reasons for significant gains and losses related to changes in the benefit obligation for the period). For public companies, these amendments, will be applied for fiscal years beginning after December 15, 2020. The adoption of this guidance should not have a material impact on the presentation of the Company’s consolidated result of operations. On August 27, 2018, the FASB issued guidance for Fair Value Measurement – Disclosure Framework – Changes to the Disclosure Requirement for Fair Value Measurement. This update focuses on improving the effectiveness of disclosures in the notes to the financial statements by facilitating clear communication of the information required by U.S. GAAP that is most important to users of each entity’s financial statements. Specifically certain disclosure requirements are removed (the amount of, and reasons for, transfer between Level 1 and Level 2 of the fair value hierarchy; the policy for timing of transfers between levels; the valuation processes for Level 3 fair value measurements) while it modifies and adds certain other disclosures (the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period, and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements). The amendments regarding changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent period in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. For public companies, these amendments will be applied for fiscal years beginning after December 15, 2019. The adoption of this guidance should not have a material impact on the presentation of the Company’s consolidated result of operations. On August 15, 2018, the FASB issued guidance for Financial Services – Insurance: Targeted Improvements to the Accounting for Long-Duration Contracts which provides meaningful improvements to the existing revenue recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. The amendments improve the timeliness of recognizing changes in the liability for future policy benefits and modify rate used to discount future cash flows, simplify and improve the accounting for certain market-based options or guarantees associated with deposit contracts, simplify the amortization of deferred acquisition costs, and improves the effectiveness of the required disclosures. Specifically, this guidance requires an insurance entity to review and update, if needed, the assumptions used to measure cash flows and discount rate at each reporting date, measure all market risk benefits associated with deposit and disclose liability rollforwards and information about significant inputs, judgments, assumptions, and methods used in measurement, including changes thereto and the effect of those changes on measurement. Additionally, the amendment simplifies the amortization of deferred acquisition costs and other balances amortized in proportion to premiums, gross profits, or gross margins, and requires that those balances be amortized on a constant level basis over the expected term of the related contracts. For public companies, these amendments will be applied for fiscal years beginning after December 15, 2020. We are currently evaluating the impact the adoption of this guidance may have on the Company’s consolidated financial statements. On July 30, 2018 and July 18, 2018, the FASB issued the following guidance Leases – Targeted Improvement and Codification Improvement to Leases, respectively, to assist in the implementation of leases and address certain technical corrections and improvement to the recently issued lease standard. Leases – Targeted Improvement provides entities with an additional and optional transition method to adopt the new lease standard under which an entity initially applies the new leases standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. It also provides lessors with a practical expedient, by class of underlying asset, to not separate non-lease components for the associated lease component. Codification: Improvement Leases addresses the following areas of correction or improvement (1) residual value guarantees, (2) rate implicit in the lease, (3) lessee reassessment of lease classification, (4) lessor reassessment of lease term and purchase option, (5) variable lease payments that depend on an index or a rate, (6) investment tax credits, (7) lease term and purchase option, (8) transition guidance for amounts previously recognized in business combinations, (9) certain transition adjustments, (10) transition guidance for leases previously classified as capital leases, (11) transition guidance for modification to leases previously classified as direct financing or sales-type leases, (12) transition guidance for sales and leaseback transactions; (13) impairment of net investment in the lease, (14) unguaranteed residual assets, (15) effect of initial direct costs on the rate implicit in the lease, and (16) failed sale and leaseback transactions. For public companies, these amendments will be applied for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We expect the standard to have a significant impact on our consolidated balance sheet, but not in our consolidated statement of earnings. The most significant impact will be the recognition of right-of-use assets and lease liabilities for operating leases. The Company will adopt the standard in the first quarter of 2019 and is currently compiling an inventory of arrangements containing a lease and accumulating the lease data necessary to apply the amended guidance. In addition, the Company will implement updates to its control processes and procedures, as necessary, based on changes resulting from the new standard. On July 16, 2018, the FASB issued guidance Codification Improvements which represents changes to clarify, correct errors in, or make minor improvements to the Codification. The change addresses conflicts or unclear intent in the following areas: (1) Comprehensive Income – Overall, (2) Debt – Modifications and Extinguishments, (3) Distinguishing Liabilities from Equity – Overall, (3) Compensation – Stock Compensation – Income Taxes, (4) Derivatives and Hedging – Overall – Other Presentation Matters, (5) Fair Value Measurement – Overall and (6) Financial Services – Brokers and Dealers – Liabilities and Financial Services – Depository and Lending. Some of the amendments in this update do not require transition guidance and are effective immediately. However, many of the amendments do have transition guidance, effective for public companies for annual periods beginning after December 15, 2018. We are currently evaluating the impact the adoption of this guidance may have on the Company’s consolidated financial statements. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards On February 28, 2018, the FASB issued guidance for Technical Corrections and Improvement to Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities. Areas for correction or improvement include (1) equity securities without a readily determinable fair value—discontinuation, (2) equity securities without a readily determinable fair value—adjustments, (3) forward contracts and purchased options, (4) presentation requirements for certain fair value option liabilities, (5) fair value option liabilities denominated in a foreign currency, and (6) transition guidance for equity securities without a readily determinable fair value. For public companies, these amendments, became effective on a prospective basis, for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Public entities with fiscal years beginning between December 15, 2017 and June 15, 2018 are not required to adopt these amendments until the interim period beginning after June 15, 2018. The Company adopted this guidance effective June 30, 2018. The adoption of this guidance did not have a material impact on the presentation of the Company’s consolidated result of operations. On January 5, 2016, the FASB issued guidance to enhance the reporting model for financial instruments to provide users of financial statements with more decision-useful information. Among the many targeted improvements to U.S. GAAP are (1) requiring equity investments, except those accounted for under the equity method of accounting or those that result in consolidation of the investee, to be measured at fair value with changes in fair value recognized in net income; (2) simplifying the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (3) eliminating the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities; and (4) clarifying that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. This guidance applies to all entities that hold financial assets or owe financial liabilities. The Company also adopted guidance issued by FASB on March 9, 2018 that removes the previous guidance for Other Than Temporary Impairment of Certain Investments in Equity Securities as required by SEC Staff Accounting Bulletin (SAB) No. 117 and SEC Release No. 33-9273, since it is no longer applicable. For public companies, these amendments became effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted this guidance for equity securities effective January 1, 2018. A cumulative-effect adjustment of $39,882 was made from accumulated other comprehensive income to the beginning retained earnings at the implementation date. Other than the accounting pronouncements disclosed above, there were no other new accounting pronouncements issued during the three months and nine months ended September 30, 2018 that could have a material impact on the Corporation’s financial position, operating results or financials statement disclosures. |
Investment in Securities (Table
Investment in Securities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Investment in Securities [Abstract] | |
Amortized Cost and Estimated Fair Value for Available-for-Sale and Held-to-Maturity Securities by Major Security Type and Class of Security | The amortized cost for debt securities and cost for equity securities, gross unrealized gains, gross unrealized losses, and estimated fair value for the Company’s investments in securities by major security type and class of security at 30, 2018 and December 31, 2017, were as follows: September 30, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Fixed maturities available for sale: Obligations of government- sponsored enterprises $ 11,460 $ - $ (130 ) $ 11,330 U.S. Treasury securities and obligations of U.S. government instrumentalities 225,968 11 (1,488 ) 224,491 Obligations of the Commonwealth of Puerto Rico and its instrumentalities 8,234 - (5 ) 8,229 Municipal securities 679,796 13,967 (4,521 ) 689,242 Corporate bonds 213,048 9,525 (1,007 ) 221,566 Residential mortgage-backed securities 59,483 - (987 ) 58,496 Collateralized mortgage obligations 11,054 - (358 ) 10,696 Total fixed maturities available for sale $ 1,209,043 $ 23,503 $ (8,496 ) $ 1,224,050 September 30, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Fixed maturities held to maturity: U.S. Treasury securities and obligations of U.S. government instrumentalities $ 617 $ 107 $ - $ 724 Residential mortgage-backed securities 190 3 - 193 Certificates of deposit 1,683 - - 1,683 Total $ 2,490 $ 110 $ - $ 2,600 September 30, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Equity investments - Mutual funds $ 267,852 $ 39,518 $ (1,010 ) $ 306,360 September 30, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Other invested assets - Alternative investments $ 71,479 $ 1,950 $ (302 ) $ 73,127 December 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Securities available for sale: Fixed maturities: Obligations of government- sponsored enterprises $ 1,431 $ 13 $ - $ 1,444 U.S. Treasury securities and obligations of U.S. government instrumentalities 118,858 41 (550 ) 118,349 Obligations of the Commonwealth of Puerto Rico and its instrumentalities 8,059 34 - 8,093 Municipal securities 771,789 30,468 (1,467 ) 800,790 Corporate bonds 217,046 17,767 (489 ) 234,324 Residential mortgage-backed securities 32,465 2 (355 ) 32,112 Collateralized mortgage obligations 22,003 10 (337 ) 21,676 Total fixed maturities 1,171,651 48,335 (3,198 ) 1,216,788 Equity securities: Mutual funds 292,460 50,072 (223 ) 342,309 Alternative investments 34,669 559 (244 ) 34,984 Total equity securities 327,129 50,631 (467 ) 377,293 Total $ 1,498,780 $ 98,966 $ (3,665 ) $ 1,594,081 December 31, 2017 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Securities held to maturity: U.S. Treasury securities and obligations of U.S. government instrumentalities $ 617 $ 154 $ - $ 771 Residential mortgage-backed securities 191 2 - 193 Certificates of deposit 1,511 - - 1,511 Total $ 2,319 $ 156 $ - $ 2,475 |
Securities in Continuous Unrealized Loss Position | Gross unrealized losses on investment securities and the estimated fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of 30, 2018 and December 31, 2017 were as follows: September 30, 2018 Less than 12 months 12 months or longer Total Estimated Fair Value Gross Unrealized Loss Number of Securities Estimated Fair Value Gross Unrealized Loss Number of Securities Estimated Fair Value Gross Unrealized Loss Number of Securities Fixed maturities available for sale: Obligations of government- $ 11,330 $ (130 ) 2 $ - $ - - $ 11,330 $ (130 ) 2 U.S. Treasury securities and 196,342 (1,488 ) 21 - - - 196,342 (1,488 ) 21 Obligations of the Commonwealth 7,485 (5 ) 4 - - - 7,485 (5 ) 4 Municipal securities 306,834 (3,727 ) 56 23,631 (794 ) 2 330,465 (4,521 ) 58 Corporate bonds 128,028 (1,007 ) 44 - - - 128,028 (1,007 ) 44 Residential mortgage-backed 53,395 (741 ) 21 5,100 (246 ) 4 58,495 (987 ) 25 Collateralized mortgage obligations 6,333 (148 ) 2 4,115 (210 ) 1 10,448 (358 ) 3 Total fixed maturities $ 709,747 $ (7,246 ) 150 $ 32,846 $ (1,250 ) 7 $ 742,593 $ (8,496 ) 157 Other invested assets - Alternative investments $ 13,460 $ (224 ) 5 $ 8,817 $ (78 ) 2 $ 22,277 $ (302 ) 7 December 31, 2017 Less than 12 months 12 months or longer Total Estimated Fair Value Gross Unrealized Loss Number of Securities Estimated Fair Value Gross Unrealized Loss Number of Securities Estimated Fair Value Gross Unrealized Loss Number of Securities Securites available for sale: Fixed maturities: U.S. Treasury securities and $ 96,617 $ (550 ) 7 $ - $ - - $ 96,617 $ (550 ) 7 Municipal securities 162,731 (1,467 ) 27 - - - 162,731 (1,467 ) 27 Corporate bonds 80,374 (489 ) 16 - - - 80,374 (489 ) 16 Residential mortgage-backed 31,736 (355 ) 19 - - - 31,736 (355 ) 19 Collateralized mortgage obligations 13,630 (239 ) 3 7,294 (98 ) 2 20,924 (337 ) 5 Total fixed maturities 385,088 (3,100 ) 72 7,294 (98 ) 2 392,382 (3,198 ) 74 Equity securities: Mutual funds 42,983 (223 ) 6 - - - 42,983 (223 ) 6 Alternative investments 9,986 (212 ) 5 3,162 (32 ) 1 13,148 (244 ) 6 Total equity securities 52,969 (435 ) 11 3,162 (32 ) 1 56,131 (467 ) 12 Total for securities available for sale $ 438,057 $ (3,535 ) 83 $ 10,456 $ (130 ) 3 $ 448,513 $ (3,665 ) 86 |
Maturities of Investment Securities Classified as Available for Sale and Held to Maturity | Maturities of investment securities classified as available for sale and held to maturity were as follows: September 30, 2018 Amortized cost Estimated fair value Fixed maturities available for sale Due in one year or less $ 11,238 $ 11,263 Due after one year through five years 400,523 398,067 Due after five years through ten years 419,705 418,411 Due after ten years 307,040 327,117 Residential mortgage-backed securities 59,483 58,496 Collateralized mortgage obligations 11,054 10,696 $ 1,209,043 $ 1,224,050 Fixed maturities held to maturity Due in one year or less 1,683 1,683 Due after ten years 617 724 Residential mortgage-backed securities 190 193 $ 2,490 $ 2,600 |
Realized Gains and Losses from Investments | Information regarding realized and unrealized gains and losses from investments is as follows: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Realized gains (losses) Fixed maturity securities: Securities available for sale: Gross gains $ 587 $ 933 2,099 $ 1,334 Gross losses (2,892 ) (194 ) (13,695 ) (830 ) Total fixed securities (2,305 ) 739 (11,596 ) 504 Equity investments: Gross gains 1,218 3,014 9,972 7,641 Gross losses (67 ) - (1,091 ) (2 ) Total equity investments 1,151 3,014 8,881 7,639 Other invested assets: Gross gains 311 - 4,104 - Gross losses (113 ) - (324 ) - Total other invested assets 198 - 3,780 - Net realized investment (losses) gains $ (956 ) $ 3,753 $ 1,065 $ 8,143 |
Changes in Net Unrealized Gains (Losses) | Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Changes in net unrealized (losses) gains: Recognized in accumulated other comprehensive (loss) income: Fixed maturities – available for sale $ (8,873 ) $ (1,199 ) $ (30,130 ) $ 1,614 Other invested assets 894 3,605 1,333 17,516 $ (7,979 ) $ 2,406 $ (28,797 ) $ 19,130 Not recognized in the consolidated financial statements: Fixed maturities – held to maturity $ (13 ) $ (2 ) $ (46 ) $ (10 ) |
Premiums and Other Receivable_2
Premiums and Other Receivables, Net (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Premiums and Other Receivables, Net [Abstract] | |
Premiums and Other Receivables, Net | Premiums and other receivables, net were as follows: September 30, 2018 December 31, 2017 Premium $ 73,624 $ 103,027 Self-funded group receivables 34,851 39,859 FEHBP 13,670 13,346 Agent balances 26,076 32,818 Accrued interest 12,243 14,331 Reinsurance recoverable 428,298 661,679 Other 84,460 70,150 673,222 935,210 Less allowance for doubtful receivables: Premium 31,379 26,490 Other 8,946 9,393 40,325 35,883 Total premium and other receivables, net $ 632,897 $ 899,327 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Measurements [Abstract] | |
Fair Value Measurements by Level for Assets Measured at Fair Value on a Recurring Basis | The following tables summarize fair value measurements by level for assets measured at fair value on a recurring basis: September 30, 2018 Level 1 Level 2 Level 3 Total Fixed maturity securities available for sale: Obligations of government-sponsored enterprises $ - $ 11,330 $ - $ 11,330 U.S. Treasury securities and obligations of U.S government instrumentalities 224,491 - - 224,491 Obligations of the Commonwealth of Puerto Rico and its instrumentalities - 8,229 - 8,229 Municipal securities - 689,242 - 689,242 Corporate bonds - 221,566 - 221,566 Residential agency mortgage-backed securities - 58,496 - 58,496 Collateralized mortgage obligations - 10,696 - 10,696 Total fixed maturities 224,491 999,559 - 1,224,050 Equity investments $ 143,638 $ 162,722 $ - $ 306,360 December 31, 2017 Securities available for sale: Level 1 Level 2 Level 3 Total Fixed maturity securities: Obligations of government-sponsored enterprises $ - $ 1,444 $ - $ 1,444 U.S. Treasury securities and obligations of U.S government instrumentalities 118,349 - - 118,349 Obligations of the Commonwealth of Puerto Rico and its instrumentalities - 8,093 - 8,093 Municipal securities - 800,790 - 800,790 Corporate bonds - 234,324 - 234,324 Residential agency mortgage-backed securities - 32,112 - 32,112 Collateralized mortgage obligations - 21,676 - 21,676 Total fixed maturities 118,349 1,098,439 - 1,216,788 Equity securities - Mutual funds 193,160 149,149 - 342,309 Alternative investments - measured at net asset value - - - 34,984 Total equity securities 193,160 149,149 - 377,293 Total $ 311,509 $ 1,247,588 $ - $ 1,594,081 |
Carrying Value and Fair Value by Level of Financial Instruments not Recorded at Fair Value on Consolidated Balance Sheet | A summary of the carrying value and fair value by level of financial instruments not recorded at fair value on our condensed consolidated balance sheets at 30, 2018 and December 31, 2017 are as follows: September 30, 2018 Carrying Fair Value Value Level 1 Level 2 Level 3 Total Assets: Policy loans $ 9,680 $ - $ 9,680 $ - $ 9,680 Liabilities: Policyholder deposits $ 174,126 $ - $ 174,126 $ - $ 174,126 Long-term borrowings: Loans payable to bank - variable 29,924 - 29,924 - 29,924 Total liabilities $ 204,050 $ - $ 204,050 $ - $ 204,050 December 31, 2017 Carrying Fair Value Value Level 1 Level 2 Level 3 Total Assets: Policy loans $ 9,077 $ - $ 9,077 $ - $ 9,077 Liabilities: Policyholder deposits $ 176,534 $ - $ 176,534 $ - $ 176,534 Long-term borrowings: Loans payable to bank - variable 32,350 - 32,350 - 32,350 Total liabilities $ 208,884 $ - $ 208,884 $ - $ 208,884 |
Claim Liabilities (Tables)
Claim Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Claim Liabilities [Abstract] | |
Reconciliation of Beginning and Ending Balances of Claim Liabilities | A reconciliation of the beginning and ending balances of claim liabilities is as follows: Nine months ended September 30, 2018 Managed Care Other Business Segments * Consolidated Claim liabilities at beginning of period $ 367,357 $ 739,519 $ 1,106,876 Reinsurance recoverable on claim liabilities - (633,099 ) (633,099 ) Net claim liabilities at beginning of period 367,357 106,420 473,777 Claims incurred: Current period insured events 1,764,038 80,774 1,844,812 Prior period insured events (30,404 ) 122,951 92,547 Total 1,733,634 203,725 1,937,359 Payments of losses and loss-adjustment expenses: Current period insured events 1,438,611 40,317 1,478,928 Prior period insured events 249,073 40,621 289,694 Total 1,687,684 80,938 1,768,622 Net claim liabilities at end of period 413,307 229,207 642,514 Reinsurance recoverable on claim liabilities - 395,600 395,600 Claim liabilities at end of period $ 413,307 $ 624,807 $ 1,033,114 * Other Business Segments include the Life Insurance and Property and Casualty segments, as well as intersegment eliminations. Nine months ended September 30, 2017 Managed Care Other Business Segments * Consolidated Claim liabilities at beginning of period $ 349,047 $ 138,896 $ 487,943 Reinsurance recoverable on claim liabilities - (38,998 ) (38,998 ) Net claim liabilities at beginning of period 349,047 99,898 448,945 Claims incurred: Current period insured events 1,724,890 95,227 1,820,117 Prior period insured events (19,158 ) (5,920 ) (25,078 ) Total 1,705,732 89,307 1,795,039 Payments of losses and loss-adjustment expenses: Current period insured events 1,456,098 38,222 1,494,320 Prior period insured events 242,384 35,325 277,709 Total 1,698,482 73,547 1,772,029 Net claim liabilities at end of period 356,297 115,658 471,955 Reinsurance recoverable on claim liabilities - 636,743 636,743 Claim liabilities at end of period $ 356,297 $ 752,401 $ 1,108,698 * Other Business Segments include the Life Insurance and Property and Casualty segments, as well as intersegment eliminations. |
Incurred But Not Reported (IBNR) Liabilities Plus Expected Development on Reported Claims Included in the Liability for Unpaid Claims Adjustment Expenses | The following is information about total incurred but not reported (IBNR) liabilities plus expected development on reported claims included in the liability for unpaid claims adjustment expenses for the Managed Care segment as of 30, 2018. Incurred Year Total of IBNR Liabilities Plus Expected Development on Reported Claims 2017 $ 11,965 2018 325,427 |
Pension Plan (Tables)
Pension Plan (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Pension Plan [Abstract] | |
Components of Net Periodic Benefit | Three months ended September 30, Nine months ended September 30, Components of net periodic benefit cost: 2018 2017 2018 2017 Interest cost $ 1,713 $ 1,652 $ 5,099 $ 5,248 Expected return on assets (2,255 ) (2,021 ) (6,817 ) (6,419 ) Amortization of actuarial loss 240 79 670 251 Settlement loss 395 580 1,045 1,211 Net periodic benefit cost $ 93 $ 290 $ (3 ) $ 291 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Income Taxes [Abstract] | |
Net Deferred Tax Asset | The net deferred tax asset at September 30, 2018 and December 31, 2017 of the Company and its subsidiaries is composed of the following: September 30, 2018 December 31, 2017 Deferred tax assets Gross deferred tax assets $ 127,563 $ 87,058 Less: valuation allowance (12,696 ) (8,283 ) Deferred tax assets 114,867 78,775 Deferred tax liabilities Gross deferred tax liabilities (34,485 ) (35,543 ) Net deferred tax asset $ 80,382 $ 43,232 |
Comprehensive Income (Loss) (Ta
Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Comprehensive Income (Loss) [Abstract] | |
Accumulated Balances of Other Comprehensive Income (Loss), Net of Tax | The accumulated balances for each classification of other comprehensive income (loss), net of tax, are as follows: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Net Unrealized Gain on Securities Beginning Balance $ 21,260 $ 75,239 $ 76,238 $ 62,371 Unrealized loss reclassified to beginning retained earnings as a result of implementation new accounting pronouncement - - (39,882 ) - Other comprehensive (loss) income before reclassifications (6,981 ) 4,853 (20,460 ) 21,233 Amounts reclassified from accumulated other comprehensive income (loss) 765 (3,002 ) (852 ) (6,514 ) Net current period change (6,216 ) 1,851 (21,312 ) 14,719 Ending Balance 15,044 77,090 15,044 77,090 Liability for Pension Benefits Beginning Balance (24,722 ) (19,870 ) (24,984 ) (19,976 ) Amounts reclassified from accumulated other comprehensive income 147 48 409 154 Ending Balance (24,575 ) (19,822 ) (24,575 ) (19,822 ) Accumulated Other Comprehensive (Loss) Income Beginning Balance (3,462 ) 55,369 51,254 42,395 Unrealized loss reclassified to beginning retained earnings as the result of implementing new accounting pronouncement - - (39,882 ) - Other comprehensive (loss) income before reclassifications (6,981 ) 4,853 (20,460 ) 21,233 Amounts reclassified from accumulated other comprehensive income (loss) 912 (2,954 ) (443 ) (6,360 ) Net current period change (6,069 ) 1,899 (20,903 ) 14,873 Ending Balance $ (9,531 ) $ 57,268 $ (9,531 ) $ 57,268 |
Net (Loss) Income Available t_2
Net (Loss) Income Available to Stockholders and Net (Loss) Income per Share (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Net (Loss) Income Available to Stockholders and Net (Loss) Income per Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Numerator for earnings per share: Net (loss) income attributable to TSM available to stockholders $ (17,567 ) $ 21,912 $ (52,400 ) $ 30,275 Denominator for basic earnings per share: Weighted average of common shares 22,895,582 24,142,192 23,058,754 24,177,344 Effect of dilutive securities - 65,830 - 54,364 Denominator for diluted earnings per share 22,895,582 24,208,022 23,058,754 24,231,708 Basic net (loss) income per share attributable to TSM $ (0.77 ) $ 0.91 $ (2.27 ) $ 1.25 Diluted net (loss) income per share attributable to TSM $ (0.77 ) $ 0.91 $ (2.27 ) $ 1.25 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Information [Abstract] | |
Operating Revenues by Major Operating Segment | The following tables summarize the operations by reportable segment for the three months and nine months ended 30, 2018 and 2017: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Operating revenues: Managed Care: Premiums earned, net $ 680,393 $ 653,734 $ 2,044,989 $ 1,955,246 Administrative service fees 3,802 3,391 11,216 12,318 Intersegment premiums/service fees 1,390 1,781 4,061 4,946 Net investment income 6,776 4,097 17,547 12,135 Total managed care 692,361 663,003 2,077,813 1,984,645 Life Insurance: Premiums earned, net 42,049 40,845 124,318 121,001 Intersegment premiums 235 107 832 409 Net investment income 6,428 6,070 19,105 18,487 Total life insurance 48,712 47,022 144,255 139,897 Property and Casualty Insurance: Premiums earned, net 20,003 19,746 66,662 62,962 Intersegment premiums 153 153 460 460 Net investment income 2,518 2,106 7,724 6,164 Total property and casualty insurance 22,674 22,005 74,846 69,586 Other segments: * Intersegment service revenues (5 ) 2,796 283 6,641 Operating revenues from external sources 1,575 976 4,234 3,130 Total other segments 1,570 3,772 4,517 9,771 Total business segments 765,317 735,802 2,301,431 2,203,899 TSM operating revenues from external sources 446 87 1,254 220 Elimination of intersegment premiums/service fees (1,778 ) (2,041 ) (5,073 ) (5,535 ) Elimination of intersegment service revenues 5 (2,796 ) (283 ) (6,641 ) Consolidated operating revenues $ 763,990 $ 731,052 $ 2,297,329 $ 2,191,943 * Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic. |
Operating Income (Loss) and Depreciation and Amortization Expense | Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Operating income (loss): Managed care $ 14,229 $ 34,819 $ 26,264 $ 19,157 Life insurance 5,681 4,477 14,637 13,402 Property and casualty insurance (46,880 ) (11,115 ) (114,820 ) (5,273 ) Other segments * 288 373 890 517 Total business segments (26,682 ) 28,554 (73,029 ) 27,803 TSM operating revenues from external sources 446 87 1,254 220 TSM unallocated operating expenses (1,780 ) (2,759 ) (6,575 ) (7,876 ) Elimination of TSM intersegment charges 2,400 2,400 7,200 7,200 Consolidated operating (loss) income (25,616 ) 28,282 (71,150 ) 27,347 Consolidated net realized investment (losses) gains (956 ) 3,753 1,065 8,143 Consolidated net unrealized investment losses on equity investments 5,632 - (11,343 ) - Consolidated interest expense (2,000 ) (1,709 ) (5,515 ) (5,116 ) Consolidated other income, net 1,943 3,409 3,600 6,521 Consolidated (loss) income before taxes $ (20,997 ) $ 33,735 $ (83,343 ) $ 36,895 Depreciation and amortization expense: Managed care $ 2,214 $ 2,567 $ 7,659 $ 7,455 Life insurance 272 315 868 913 Property and casualty insurance 89 136 301 388 Other segments* 175 166 515 489 Total business segments 2,750 3,184 9,343 9,245 TSM depreciation expense 197 197 590 590 Consolidated depreciation and amortization expense $ 2,947 $ 3,381 $ 9,933 $ 9,835 * Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic. |
Assets | September 30, 2018 December 31, 2017 Assets: Managed care $ 1,130,401 $ 1,092,715 Life insurance 852,750 853,289 Property and casualty insurance 762,705 1,094,773 Other segments * 20,787 19,027 Total business segments 2,766,643 3,059,804 Unallocated amounts related to TSM: Cash, cash equivalents, and investments 59,496 81,169 Property and equipment, net 21,326 22,257 Other assets 23,547 22,763 104,369 126,189 Elimination entries-intersegment receivables and others (52,584 ) (69,228 ) Consolidated total assets $ 2,818,428 $ 3,116,765 * Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic. |
Significant Accounting Polici_3
Significant Accounting Policies (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Fixed Maturities and Other Invested Assets [Abstract] | |
Unfunded capital commitments | $ 88,691 |
Remaining average commitments period | 3 years |
Minimum [Member] | |
Fixed Maturities and Other Invested Assets [Abstract] | |
Estimated liquidation period for underlying assets of funds | 5 years |
Maximum [Member] | |
Fixed Maturities and Other Invested Assets [Abstract] | |
Estimated liquidation period for underlying assets of funds | 12 years |
Accumulated Other Comprehensive Income [Member] | |
Recently Adopted Accounting Standards [Abstract] | |
Cumulative-effect adjustment made from accumulated other comprehensive income to retained earnings | $ (39,882) |
Retained Earnings [Member] | |
Recently Adopted Accounting Standards [Abstract] | |
Cumulative-effect adjustment made from accumulated other comprehensive income to retained earnings | $ 39,882 |
Investment in Securities, Secur
Investment in Securities, Securities Available for Sale, Equity Investments, and Other Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Available-for-sale debt securities, amortized cost basis [Abstract] | ||
Amortized cost | $ 1,209,043 | $ 1,171,651 |
Gross unrealized gains | 23,503 | 48,335 |
Gross unrealized losses | (8,496) | (3,198) |
Estimated fair value | 1,224,050 | 1,216,788 |
Available-for-sale equity securities, amortized cost basis [Abstract] | ||
Amortized cost | 327,129 | |
Gross unrealized gains | 50,631 | |
Gross unrealized losses | (467) | |
Estimated fair value | 377,293 | |
Available-for-sale securities, amortized cost basis [Abstract] | ||
Amortized cost | 1,498,780 | |
Gross unrealized gains | 98,966 | |
Gross unrealized losses | (3,665) | |
Estimated fair value | 1,594,081 | |
Obligations of Government-sponsored Enterprises [Member] | ||
Available-for-sale debt securities, amortized cost basis [Abstract] | ||
Amortized cost | 11,460 | 1,431 |
Gross unrealized gains | 0 | 13 |
Gross unrealized losses | (130) | 0 |
Estimated fair value | 11,330 | 1,444 |
U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member] | ||
Available-for-sale debt securities, amortized cost basis [Abstract] | ||
Amortized cost | 225,968 | 118,858 |
Gross unrealized gains | 11 | 41 |
Gross unrealized losses | (1,488) | (550) |
Estimated fair value | 224,491 | 118,349 |
Obligations of the Commonwealth of Puerto Rico and its Instrumentalities [Member] | ||
Available-for-sale debt securities, amortized cost basis [Abstract] | ||
Amortized cost | 8,234 | 8,059 |
Gross unrealized gains | 0 | 34 |
Gross unrealized losses | (5) | 0 |
Estimated fair value | 8,229 | 8,093 |
Municipal Securities [Member] | ||
Available-for-sale debt securities, amortized cost basis [Abstract] | ||
Amortized cost | 679,796 | 771,789 |
Gross unrealized gains | 13,967 | 30,468 |
Gross unrealized losses | (4,521) | (1,467) |
Estimated fair value | 689,242 | 800,790 |
Corporate Bonds [Member] | ||
Available-for-sale debt securities, amortized cost basis [Abstract] | ||
Amortized cost | 213,048 | 217,046 |
Gross unrealized gains | 9,525 | 17,767 |
Gross unrealized losses | (1,007) | (489) |
Estimated fair value | 221,566 | 234,324 |
Residential Mortgage-backed Securities [Member] | ||
Available-for-sale debt securities, amortized cost basis [Abstract] | ||
Amortized cost | 59,483 | 32,465 |
Gross unrealized gains | 0 | 2 |
Gross unrealized losses | (987) | (355) |
Estimated fair value | 58,496 | 32,112 |
Collateralized Mortgage Obligations [Member] | ||
Available-for-sale debt securities, amortized cost basis [Abstract] | ||
Amortized cost | 11,054 | 22,003 |
Gross unrealized gains | 0 | 10 |
Gross unrealized losses | (358) | (337) |
Estimated fair value | 10,696 | 21,676 |
Equity Investments - Mutual Funds [Member] | ||
Available-for-sale equity securities, amortized cost basis [Abstract] | ||
Amortized cost | 267,852 | 292,460 |
Gross unrealized gains | 39,518 | 50,072 |
Gross unrealized losses | (1,010) | (223) |
Estimated fair value | 306,360 | 342,309 |
Other Invested Assets - Alternative investments [Member] | ||
Available-for-sale equity securities, amortized cost basis [Abstract] | ||
Amortized cost | 71,479 | 34,669 |
Gross unrealized gains | 1,950 | 559 |
Gross unrealized losses | (302) | (244) |
Estimated fair value | $ 73,127 | $ 34,984 |
Investment in Securities, Sec_2
Investment in Securities, Securities Held to Maturity (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Securities held to maturity [Abstract] | ||
Amortized cost | $ 2,490 | $ 2,319 |
Gross unrealized gains | 110 | 156 |
Gross unrealized losses | 0 | 0 |
Estimated fair value | 2,600 | 2,475 |
U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member] | ||
Securities held to maturity [Abstract] | ||
Amortized cost | 617 | 617 |
Gross unrealized gains | 107 | 154 |
Gross unrealized losses | 0 | 0 |
Estimated fair value | 724 | 771 |
Residential Mortgage-backed Securities [Member] | ||
Securities held to maturity [Abstract] | ||
Amortized cost | 190 | 191 |
Gross unrealized gains | 3 | 2 |
Gross unrealized losses | 0 | 0 |
Estimated fair value | 193 | 193 |
Certificates of Deposit [Member] | ||
Securities held to maturity [Abstract] | ||
Amortized cost | 1,683 | 1,511 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 0 | 0 |
Estimated fair value | $ 1,683 | $ 1,511 |
Investment in Securities, Sec_3
Investment in Securities, Securities in Continuous Unrealized Loss Position (Details) $ in Thousands | Sep. 30, 2018USD ($)Security | Dec. 31, 2017USD ($)Security |
Equity Securities, Available-for-sale, Unrealized Loss Position Fair Value [Abstract] | ||
Less than 12 months | $ 438,057 | |
12 months or longer | 10,456 | |
Total | 448,513 | |
Equity Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (3,535) | |
12 months or longer | (130) | |
Total | $ (3,665) | |
Equity Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 83 | |
12 months or longer | Security | 3 | |
Total | Security | 86 | |
Obligations of Government-sponsored Enterprises [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Abstract] | ||
Less than 12 months | $ 11,330 | |
12 months or longer | 0 | |
Total | 11,330 | |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (130) | |
12 months or longer | 0 | |
Total | $ (130) | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 2 | |
12 months or longer | Security | 0 | |
Total | Security | 2 | |
U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Abstract] | ||
Less than 12 months | $ 196,342 | $ 96,617 |
12 months or longer | 0 | 0 |
Total | 196,342 | 96,617 |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (1,488) | (550) |
12 months or longer | 0 | 0 |
Total | $ (1,488) | $ (550) |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 21 | 7 |
12 months or longer | Security | 0 | 0 |
Total | Security | 21 | 7 |
Obligations of the Commonwealth of Puerto Rico and its Instrumentalities [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Abstract] | ||
Less than 12 months | $ 7,485 | |
12 months or longer | 0 | |
Total | 7,485 | |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (5) | |
12 months or longer | 0 | |
Total | $ (5) | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 4 | |
12 months or longer | Security | 0 | |
Total | Security | 4 | |
Municipal Securities [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Abstract] | ||
Less than 12 months | $ 306,834 | $ 162,731 |
12 months or longer | 23,631 | 0 |
Total | 330,465 | 162,731 |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (3,727) | (1,467) |
12 months or longer | (794) | 0 |
Total | $ (4,521) | $ (1,467) |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 56 | 27 |
12 months or longer | Security | 2 | 0 |
Total | Security | 58 | 27 |
Corporate Bonds [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Abstract] | ||
Less than 12 months | $ 128,028 | $ 80,374 |
12 months or longer | 0 | 0 |
Total | 128,028 | 80,374 |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (1,007) | (489) |
12 months or longer | 0 | 0 |
Total | $ (1,007) | $ (489) |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 44 | 16 |
12 months or longer | Security | 0 | 0 |
Total | Security | 44 | 16 |
Residential Mortgage-backed Securities [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Abstract] | ||
Less than 12 months | $ 53,395 | $ 31,736 |
12 months or longer | 5,100 | 0 |
Total | 58,495 | 31,736 |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (741) | (355) |
12 months or longer | (246) | 0 |
Total | $ (987) | $ (355) |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 21 | 19 |
12 months or longer | Security | 4 | 0 |
Total | Security | 25 | 19 |
Collateralized Mortgage Obligations [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Abstract] | ||
Less than 12 months | $ 6,333 | $ 13,630 |
12 months or longer | 4,115 | 7,294 |
Total | 10,448 | 20,924 |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (148) | (239) |
12 months or longer | (210) | (98) |
Total | $ (358) | $ (337) |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 2 | 3 |
12 months or longer | Security | 1 | 2 |
Total | Security | 3 | 5 |
Fixed Maturities [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Abstract] | ||
Less than 12 months | $ 709,747 | $ 385,088 |
12 months or longer | 32,846 | 7,294 |
Total | 742,593 | 392,382 |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (7,246) | (3,100) |
12 months or longer | (1,250) | (98) |
Total | $ (8,496) | $ (3,198) |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 150 | 72 |
12 months or longer | Security | 7 | 2 |
Total | Security | 157 | 74 |
Mutual Funds [Member] | ||
Equity Securities, Available-for-sale, Unrealized Loss Position Fair Value [Abstract] | ||
Less than 12 months | $ 42,983 | |
12 months or longer | 0 | |
Total | 42,983 | |
Equity Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (223) | |
12 months or longer | 0 | |
Total | $ (223) | |
Equity Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 6 | |
12 months or longer | Security | 0 | |
Total | Security | 6 | |
Alternative Investments [Member] | ||
Equity Securities, Available-for-sale, Unrealized Loss Position Fair Value [Abstract] | ||
Less than 12 months | $ 13,460 | $ 9,986 |
12 months or longer | 8,817 | 3,162 |
Total | 22,277 | 13,148 |
Equity Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (224) | (212) |
12 months or longer | (78) | (32) |
Total | $ (302) | $ (244) |
Equity Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 5 | 5 |
12 months or longer | Security | 2 | 1 |
Total | Security | 7 | 6 |
Equity Securities [Member] | ||
Equity Securities, Available-for-sale, Unrealized Loss Position Fair Value [Abstract] | ||
Less than 12 months | $ 52,969 | |
12 months or longer | 3,162 | |
Total | 56,131 | |
Equity Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months | (435) | |
12 months or longer | (32) | |
Total | $ (467) | |
Equity Securities, Available-for-sale, Continuous Unrealized Loss Position, Number of Positions [Abstract] | ||
Less than 12 months | Security | 11 | |
12 months or longer | Security | 1 | |
Total | Security | 12 |
Investment in Securities, Matur
Investment in Securities, Maturities of Investment Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Fixed maturities available for sale, amortized cost [Abstract] | ||
Due in one year or less | $ 11,238 | |
Due after one year through five years | 400,523 | |
Due after five years through ten years | 419,705 | |
Due after ten years | 307,040 | |
Residential mortgage-backed securities | 59,483 | |
Collateralized mortgage obligations | 11,054 | |
Amortized cost | 1,209,043 | $ 1,171,651 |
Fixed maturities available for sale, estimated fair value [Abstract] | ||
Due in one year or less | 11,263 | |
Due after one year through five | 398,067 | |
Due after five years through ten years | 418,411 | |
Due after ten years | 327,117 | |
Residential mortgage-backed securities | 58,496 | |
Collateralized mortgage obligations | 10,696 | |
Estimated fair value | 1,224,050 | 1,216,788 |
Fixed maturities held to maturity, amortized cost [Abstract] | ||
Due in one year or less | 1,683 | |
Due after ten years | 617 | |
Residential mortgage-backed securities | 190 | |
Amortized cost | 2,490 | 2,319 |
Fixed maturities held to maturity, estimated fair value [Abstract] | ||
Due in one year or less | 1,683 | |
Due after ten years | 724 | |
Residential mortgage-backed securities | 193 | |
Estimated fair value | $ 2,600 | $ 2,475 |
Investment in Securities, Reali
Investment in Securities, Realized and Unrealized Gains and Losses from Investments (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018USD ($)Investment | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)Investment | Sep. 30, 2017USD ($) | Dec. 31, 2017Investment | |
Fixed maturity securities, available for sale [Abstract] | |||||
Gross gains | $ 587 | $ 933 | $ 2,099 | $ 1,334 | |
Gross losses | (2,892) | (194) | (13,695) | (830) | |
Total fixed securities | (2,305) | 739 | (11,596) | 504 | |
Equity investments [Abstract] | |||||
Gross gains | 1,218 | 3,014 | 9,972 | 7,641 | |
Gross losses | (67) | 0 | (1,091) | (2) | |
Total equity investments | 1,151 | 3,014 | 8,881 | 7,639 | |
Other invested assets [Abstract] | |||||
Gross gains | 311 | 0 | 4,104 | 0 | |
Gross losses | (113) | 0 | (324) | 0 | |
Total other invested assets | 198 | 0 | 3,780 | 0 | |
Net realized investment (losses) gains | (956) | 3,753 | 1,065 | 8,143 | |
Recognized in accumulated other comprehensive (loss) income [Abstract] | |||||
Unrealized (losses) gains | (7,979) | 2,406 | (28,797) | 19,130 | |
Not recognized in the consolidated financial statements [Abstract] | |||||
Fixed maturities - held to maturity | (13) | (2) | (46) | (10) | |
Deferred tax liability on unrealized gains | $ 7,980 | 4,503 | $ 7,980 | 4,503 | |
Number of individual investment in securities exceeding 10% of stockholders' equity | Investment | 0 | 0 | 0 | ||
Fixed Maturities - Available for Sale [Member] | |||||
Recognized in accumulated other comprehensive (loss) income [Abstract] | |||||
Unrealized (losses) gains | $ (8,873) | (1,199) | $ (30,130) | 1,614 | |
Other Invested Assets - Alternative investments [Member] | |||||
Recognized in accumulated other comprehensive (loss) income [Abstract] | |||||
Unrealized (losses) gains | $ 894 | $ 3,605 | $ 1,333 | $ 17,516 |
Premiums and Other Receivable_3
Premiums and Other Receivables, Net (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Premiums and other receivables, net [Abstract] | ||
Premium | $ 73,624 | $ 103,027 |
Self-funded group receivables | 34,851 | 39,859 |
FEHBP | 13,670 | 13,346 |
Agent balances | 26,076 | 32,818 |
Accrued interest | 12,243 | 14,331 |
Reinsurance recoverable | 428,298 | 661,679 |
Other | 84,460 | 70,150 |
Premiums and other receivables, total | 673,222 | 935,210 |
Less allowance for doubtful receivables [Abstract] | ||
Premium | 31,379 | 26,490 |
Other | 8,946 | 9,393 |
Premiums and other receivables, allowance | 40,325 | 35,883 |
Total premium and other receivables, net | 632,897 | 899,327 |
Government of Puerto Rico [Member] | ||
Premiums and other receivables, net [Abstract] | ||
Premiums and other receivables, total | 52,170 | 81,838 |
Less allowance for doubtful receivables [Abstract] | ||
Premiums and other receivables, allowance | $ 19,614 | $ 16,436 |
Fair Value Measurements, Fair V
Fair Value Measurements, Fair Value Measurements by Level for Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Securities available for sale [Abstract] | ||
Fixed maturities | $ 1,224,050 | $ 1,216,788 |
Equity investments | 306,360 | 342,309 |
Equity securities | 377,293 | |
Obligations of Government-sponsored Enterprises [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 11,330 | 1,444 |
U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 224,491 | 118,349 |
Obligations of the Commonwealth of Puerto Rico and its Instrumentalities [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 8,229 | 8,093 |
Municipal Securities [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 689,242 | 800,790 |
Corporate Bonds [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 221,566 | 234,324 |
Residential Agency Mortgage-backed Securities [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 58,496 | 32,112 |
Collateralized Mortgage Obligations [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 10,696 | 21,676 |
Mutual Funds [Member] | ||
Securities available for sale [Abstract] | ||
Equity securities | 306,360 | 342,309 |
Alternative Investments [Member] | ||
Securities available for sale [Abstract] | ||
Equity securities | 73,127 | 34,984 |
Fair Value, Measurements, Recurring [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 1,224,050 | 1,216,788 |
Equity investments | 306,360 | |
Equity securities | 377,293 | |
Total | 1,594,081 | |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 224,491 | 118,349 |
Equity investments | 143,638 | |
Equity securities | 193,160 | |
Total | 311,509 | |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 999,559 | 1,098,439 |
Equity investments | 162,722 | |
Equity securities | 149,149 | |
Total | 1,247,588 | |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Equity investments | 0 | |
Equity securities | 0 | |
Total | 0 | |
Fair Value, Measurements, Recurring [Member] | Obligations of Government-sponsored Enterprises [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 11,330 | 1,444 |
Fair Value, Measurements, Recurring [Member] | Obligations of Government-sponsored Enterprises [Member] | Level 1 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Obligations of Government-sponsored Enterprises [Member] | Level 2 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 11,330 | 1,444 |
Fair Value, Measurements, Recurring [Member] | Obligations of Government-sponsored Enterprises [Member] | Level 3 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 224,491 | 118,349 |
Fair Value, Measurements, Recurring [Member] | U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member] | Level 1 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 224,491 | 118,349 |
Fair Value, Measurements, Recurring [Member] | U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member] | Level 2 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member] | Level 3 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Obligations of the Commonwealth of Puerto Rico and its Instrumentalities [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 8,229 | 8,093 |
Fair Value, Measurements, Recurring [Member] | Obligations of the Commonwealth of Puerto Rico and its Instrumentalities [Member] | Level 1 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Obligations of the Commonwealth of Puerto Rico and its Instrumentalities [Member] | Level 2 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 8,229 | 8,093 |
Fair Value, Measurements, Recurring [Member] | Obligations of the Commonwealth of Puerto Rico and its Instrumentalities [Member] | Level 3 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Municipal Securities [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 689,242 | 800,790 |
Fair Value, Measurements, Recurring [Member] | Municipal Securities [Member] | Level 1 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Municipal Securities [Member] | Level 2 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 689,242 | 800,790 |
Fair Value, Measurements, Recurring [Member] | Municipal Securities [Member] | Level 3 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 221,566 | 234,324 |
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member] | Level 1 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member] | Level 2 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 221,566 | 234,324 |
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member] | Level 3 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Residential Agency Mortgage-backed Securities [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 58,496 | 32,112 |
Fair Value, Measurements, Recurring [Member] | Residential Agency Mortgage-backed Securities [Member] | Level 1 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Residential Agency Mortgage-backed Securities [Member] | Level 2 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 58,496 | 32,112 |
Fair Value, Measurements, Recurring [Member] | Residential Agency Mortgage-backed Securities [Member] | Level 3 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Obligations [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 10,696 | 21,676 |
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Obligations [Member] | Level 1 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Obligations [Member] | Level 2 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | 10,696 | 21,676 |
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Obligations [Member] | Level 3 [Member] | ||
Securities available for sale [Abstract] | ||
Fixed maturities | $ 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Mutual Funds [Member] | ||
Securities available for sale [Abstract] | ||
Equity securities | 342,309 | |
Fair Value, Measurements, Recurring [Member] | Mutual Funds [Member] | Level 1 [Member] | ||
Securities available for sale [Abstract] | ||
Equity securities | 193,160 | |
Fair Value, Measurements, Recurring [Member] | Mutual Funds [Member] | Level 2 [Member] | ||
Securities available for sale [Abstract] | ||
Equity securities | 149,149 | |
Fair Value, Measurements, Recurring [Member] | Mutual Funds [Member] | Level 3 [Member] | ||
Securities available for sale [Abstract] | ||
Equity securities | 0 | |
Fair Value, Measurements, Recurring [Member] | Alternative Investments [Member] | ||
Securities available for sale [Abstract] | ||
Equity securities | 34,984 | |
Fair Value, Measurements, Recurring [Member] | Alternative Investments [Member] | Level 1 [Member] | ||
Securities available for sale [Abstract] | ||
Equity securities | 0 | |
Fair Value, Measurements, Recurring [Member] | Alternative Investments [Member] | Level 2 [Member] | ||
Securities available for sale [Abstract] | ||
Equity securities | 0 | |
Fair Value, Measurements, Recurring [Member] | Alternative Investments [Member] | Level 3 [Member] | ||
Securities available for sale [Abstract] | ||
Equity securities | $ 0 |
Fair Value Measurements, Reconc
Fair Value Measurements, Reconciliation of Assets Measured at Fair Value Using Significant Unobservable Inputs (Level 3) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 |
Fair Value Measurements [Abstract] | ||
Level 1 to level 2 transfers | $ 0 | $ 0 |
Level 2 to level 1 transfers | $ 0 | $ 0 |
Fair Value Measurements, Summar
Fair Value Measurements, Summary of Carrying Value and Fair Value by Level of Financial Instruments Not Recorded at Fair Value (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Carrying Value [Member] | ||
Assets [Abstract] | ||
Policy loans | $ 9,680 | $ 9,077 |
Liabilities [Abstract] | ||
Policyholder deposits | 174,126 | 176,534 |
Total liabilities | 204,050 | 208,884 |
Carrying Value [Member] | Loans Payable [Member] | Loans Payable to Bank - Variable [Member] | ||
Liabilities [Abstract] | ||
Long-term borrowings | 29,924 | 32,350 |
Fair Value [Member] | ||
Assets [Abstract] | ||
Policy loans | 9,680 | 9,077 |
Liabilities [Abstract] | ||
Policyholder deposits | 174,126 | 176,534 |
Total liabilities | 204,050 | 208,884 |
Fair Value [Member] | Loans Payable [Member] | Loans Payable to Bank - Variable [Member] | ||
Liabilities [Abstract] | ||
Long-term borrowings | 29,924 | 32,350 |
Fair Value [Member] | Level 1 [Member] | ||
Assets [Abstract] | ||
Policy loans | 0 | 0 |
Liabilities [Abstract] | ||
Policyholder deposits | 0 | 0 |
Total liabilities | 0 | 0 |
Fair Value [Member] | Level 1 [Member] | Loans Payable [Member] | Loans Payable to Bank - Variable [Member] | ||
Liabilities [Abstract] | ||
Long-term borrowings | 0 | 0 |
Fair Value [Member] | Level 2 [Member] | ||
Assets [Abstract] | ||
Policy loans | 9,680 | 9,077 |
Liabilities [Abstract] | ||
Policyholder deposits | 174,126 | 176,534 |
Total liabilities | 204,050 | 208,884 |
Fair Value [Member] | Level 2 [Member] | Loans Payable [Member] | Loans Payable to Bank - Variable [Member] | ||
Liabilities [Abstract] | ||
Long-term borrowings | 29,924 | 32,350 |
Fair Value [Member] | Level 3 [Member] | ||
Assets [Abstract] | ||
Policy loans | 0 | 0 |
Liabilities [Abstract] | ||
Policyholder deposits | 0 | 0 |
Total liabilities | 0 | 0 |
Fair Value [Member] | Level 3 [Member] | Loans Payable [Member] | Loans Payable to Bank - Variable [Member] | ||
Liabilities [Abstract] | ||
Long-term borrowings | $ 0 | $ 0 |
Claim Liabilities, Reconciliati
Claim Liabilities, Reconciliation of Beginning and Ending Balances of Claim Liabilities (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | ||
Reconciliation of beginning and ending balances of claim liabilities [Roll Forward] | |||
Claim liabilities at beginning of period | $ 1,106,876 | $ 487,943 | |
Reinsurance recoverable on claim liabilities | (633,099) | (38,998) | |
Net claim liabilities at beginning of period | 473,777 | 448,945 | |
Claims incurred [Abstract] | |||
Current period insured events | 1,844,812 | 1,820,117 | |
Prior period insured events | 92,547 | (25,078) | |
Total | 1,937,359 | 1,795,039 | |
Payments of losses and loss-adjustment expenses [Abstract] | |||
Current period insured events | 1,478,928 | 1,494,320 | |
Prior period insured events | 289,694 | 277,709 | |
Total | 1,768,622 | 1,772,029 | |
Net claim liabilities at end of period | 642,514 | 471,955 | |
Reinsurance recoverable on claim liabilities | 395,600 | 636,743 | |
Claim liabilities at end of period | 1,038,114 | 1,108,698 | |
Change in liability for future policy (benefits) expense | 22,348 | 20,746 | |
Hurricane Maria [Member] | |||
Payments of losses and loss-adjustment expenses [Abstract] | |||
Prior period insured events | 128,707 | ||
Claim liabilities at end of period | 488,180 | ||
Managed Care [Member] | |||
Reconciliation of beginning and ending balances of claim liabilities [Roll Forward] | |||
Claim liabilities at beginning of period | 367,357 | 349,047 | |
Reinsurance recoverable on claim liabilities | 0 | 0 | |
Net claim liabilities at beginning of period | 367,357 | 349,047 | |
Claims incurred [Abstract] | |||
Current period insured events | 1,764,038 | 1,724,890 | |
Prior period insured events | (30,404) | (19,158) | |
Total | 1,733,634 | 1,705,732 | |
Payments of losses and loss-adjustment expenses [Abstract] | |||
Current period insured events | 1,438,611 | 1,456,098 | |
Prior period insured events | 249,073 | 242,384 | |
Total | 1,687,684 | 1,698,482 | |
Net claim liabilities at end of period | 413,307 | 356,297 | |
Reinsurance recoverable on claim liabilities | 0 | 0 | |
Claim liabilities at end of period | 413,307 | 356,297 | |
Other Business Segments [Member] | |||
Reconciliation of beginning and ending balances of claim liabilities [Roll Forward] | |||
Claim liabilities at beginning of period | [1] | 739,519 | 138,896 |
Reinsurance recoverable on claim liabilities | [1] | (633,099) | (38,998) |
Net claim liabilities at beginning of period | [1] | 106,420 | 99,898 |
Claims incurred [Abstract] | |||
Current period insured events | [1] | 80,774 | 95,227 |
Prior period insured events | [1] | 122,951 | (5,920) |
Total | [1] | 203,725 | 89,307 |
Payments of losses and loss-adjustment expenses [Abstract] | |||
Current period insured events | [1] | 40,317 | 38,222 |
Prior period insured events | [1] | 40,621 | 35,325 |
Total | [1] | 80,938 | 73,547 |
Net claim liabilities at end of period | [1] | 229,207 | 115,658 |
Reinsurance recoverable on claim liabilities | [1] | 395,600 | 636,743 |
Claim liabilities at end of period | [1] | $ 624,807 | $ 752,401 |
[1] | Other Business Segments include the Life Insurance and Property and Casualty segments, as well as intersegment eliminations. |
Claim Liabilities, Incurred But
Claim Liabilities, Incurred But Not Reported (IBNR) Liabilities Plus Expected Development on Reported Claims Included in the Liability for Unpaid Claims Adjustment Expenses (Details) - Managed Care [Member] $ in Thousands | Sep. 30, 2018USD ($) |
Incurred Year 2017 [Member] | |
Insurance Claims Development, Net of Reinsurance [Abstract] | |
Total of IBNR liabilities plus expected development on reported claims | $ 11,965 |
Incurred Year 2018 [Member] | |
Insurance Claims Development, Net of Reinsurance [Abstract] | |
Total of IBNR liabilities plus expected development on reported claims | $ 325,427 |
Pension Plan (Details)
Pension Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Components of net periodic benefit cost [Abstract] | |||||
Interest cost | $ 1,713 | $ 1,652 | $ 5,099 | $ 5,248 | |
Expected return on assets | (2,255) | (2,021) | (6,817) | (6,419) | |
Amortization of actuarial loss | 240 | 79 | 670 | 251 | |
Settlement loss | 395 | 580 | 1,045 | 1,211 | |
Net periodic benefit cost | $ 93 | $ 290 | (3) | $ 291 | |
Expected employer future contributions | $ 2,000 | ||||
Employer contribution | $ 2,000 |
Reinsurance (Details)
Reinsurance (Details) - TSP [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Reinsurance [Abstract] | ||||
Ceded premiums written | $ 12,658 | $ 13,370 | $ 40,124 | $ 40,091 |
Period of reinsurance contracts | 1 year | |||
Property Reinsurance Treaty [Member] | ||||
Reinsurance [Abstract] | ||||
Amount of claim covered, per person | $ 30,000 | |||
Hurricanes Irma and Maria [Member] | ||||
Reinsurance [Abstract] | ||||
Claims ceded | 153,707 | $ 603,893 | ||
Minimum [Member] | Casualty Excess of Loss Treaty [Member] | ||||
Reinsurance [Abstract] | ||||
Amount of claim covered, per person | 225 | |||
Minimum [Member] | Medical Malpractice Excess of Loss [Member] | ||||
Reinsurance [Abstract] | ||||
Amount of claim covered, per person | 150 | |||
Minimum [Member] | Property Reinsurance Treaty [Member] | ||||
Reinsurance [Abstract] | ||||
Amount of claim covered, per person | 350 | |||
Minimum [Member] | Catastrophe [Member] | ||||
Reinsurance [Abstract] | ||||
Amount of claim covered, per person | 10,000 | |||
Maximum [Member] | Casualty Excess of Loss Treaty [Member] | ||||
Reinsurance [Abstract] | ||||
Amount of claim covered, per person | 12,000 | |||
Maximum [Member] | Medical Malpractice Excess of Loss [Member] | ||||
Reinsurance [Abstract] | ||||
Amount of claim covered, per person | 3,000 | |||
Maximum [Member] | Catastrophe [Member] | ||||
Reinsurance [Abstract] | ||||
Amount of claim covered, per person | $ 915,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Deferred tax assets [Abstract] | ||
Gross deferred tax assets | $ 127,563 | $ 87,058 |
Less: valuation allowance | (12,696) | (8,283) |
Deferred tax assets | 114,867 | 78,775 |
Deferred tax liabilities [Abstract] | ||
Gross deferred tax liabilities | (34,485) | (35,543) |
Net deferred tax asset | 80,382 | 43,232 |
Deferred tax assets, net | 83,593 | 65,123 |
Deferred tax liabilities, net | $ 3,210 | $ 21,891 |
Minimum [Member] | ||
Net Operating Loss Carryforwards [Abstract] | ||
Operating loss carryforwards, expiration date | Dec. 31, 2026 | |
Maximum [Member] | ||
Net Operating Loss Carryforwards [Abstract] | ||
Operating loss carryforwards, expiration date | Dec. 31, 2028 | |
Puerto Rico [Member] | ||
Net Operating Loss Carryforwards [Abstract] | ||
Operating loss carryforwards | $ 169,000 | |
Operating loss carryforwards, expiration date | Dec. 31, 2028 |
Comprehensive Income (Loss) (De
Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Accumulated balances for each classification of other comprehensive income (loss), net of tax [Roll Forward] | ||||
Balance | $ 912,682 | |||
Total other comprehensive (loss) income, net of tax | $ (6,069) | $ 1,899 | (20,903) | $ 14,873 |
Balance | 819,838 | 896,730 | 819,838 | 896,730 |
Net Unrealized Gain on Securities [Member] | ||||
Accumulated balances for each classification of other comprehensive income (loss), net of tax [Roll Forward] | ||||
Balance | 21,260 | 75,239 | 76,238 | 62,371 |
Unrealized loss reclassified to beginning retained earnings as a result of implementation new accounting pronouncement | 0 | 0 | (39,882) | 0 |
Other comprehensive (loss) income before reclassifications | (6,981) | 4,853 | (20,460) | 21,233 |
Amounts reclassified from accumulated other comprehensive income (loss) | 765 | (3,002) | (852) | (6,514) |
Total other comprehensive (loss) income, net of tax | (6,216) | 1,851 | (21,312) | 14,719 |
Balance | 15,044 | 77,090 | 15,044 | 77,090 |
Liability for Pension Benefits [Member] | ||||
Accumulated balances for each classification of other comprehensive income (loss), net of tax [Roll Forward] | ||||
Balance | (24,722) | (19,870) | (24,984) | (19,976) |
Amounts reclassified from accumulated other comprehensive income (loss) | 147 | 48 | 409 | 154 |
Balance | (24,575) | (19,822) | (24,575) | (19,822) |
Accumulated Other Comprehensive (Loss) Income [Member] | ||||
Accumulated balances for each classification of other comprehensive income (loss), net of tax [Roll Forward] | ||||
Balance | (3,462) | 55,369 | 51,254 | 42,395 |
Unrealized loss reclassified to beginning retained earnings as a result of implementation new accounting pronouncement | 0 | 0 | (39,882) | 0 |
Other comprehensive (loss) income before reclassifications | (6,981) | 4,853 | (20,460) | 21,233 |
Amounts reclassified from accumulated other comprehensive income (loss) | 912 | (2,954) | (443) | (6,360) |
Total other comprehensive (loss) income, net of tax | (6,069) | 1,899 | (20,903) | 14,873 |
Balance | $ (9,531) | $ 57,268 | $ (9,531) | $ 57,268 |
Stock Repurchase Program (Detai
Stock Repurchase Program (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 28, 2018 | Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Aug. 31, 2017 |
Stock Repurchase Program [Abstract] | |||||
Stock repurchased and retired, amount | $ 23,014 | $ 12,553 | |||
2017 Stock Repurchase Program [Member] | |||||
Stock Repurchase Program [Abstract] | |||||
Stock repurchased and retired (in shares) | 259,925 | 903,888 | |||
Average per share price (in dollars per share) | $ 23.06 | $ 24.76 | |||
Stock repurchased and retired, amount | $ 5,995 | $ 22,390 | |||
2017 Stock Repurchase Program [Member] | Class B Common Stock [Member] | |||||
Stock Repurchase Program [Abstract] | |||||
Stock repurchase, authorized amount | $ 30,000 | ||||
Stock repurchase, additional authorized amount | $ 25,000 |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Share-Based Compensation [Abstract] | ||||
Share-based compensation expense | $ 919 | $ 1,481 | $ 3,462 | $ 1,651 |
Shares repurchased and retired as a result of non-cash tax withholdings upon vesting of shares (in shares) | 24,796 | 0 |
Net (Loss) Income Available t_3
Net (Loss) Income Available to Stockholders and Net (Loss) Income per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Numerator for earnings per share [Abstract] | ||||
Net (loss) income attributable to TSM available to stockholders | $ (17,567) | $ 21,912 | $ (52,400) | $ 30,275 |
Denominator for basic earnings per share [Abstract] | ||||
Weighted average of common shares (in shares) | 22,895,582 | 24,142,192 | 23,058,754 | 24,177,344 |
Effect of dilutive securities (in shares) | 0 | 65,830 | 0 | 54,364 |
Denominator for diluted earnings per share (in shares) | 22,895,582 | 24,208,022 | 23,058,754 | 24,231,708 |
Basic net (loss) income per share attributable to TSM (in dollars per share) | $ (0.77) | $ 0.91 | $ (2.27) | $ 1.25 |
Diluted net (loss) income per share attributable to TSM (in dollars per share) | $ (0.77) | $ 0.91 | $ (2.27) | $ 1.25 |
Restricted Stock Awards [Member] | ||||
Net (Loss) Income Available to Stockholders and Net (Loss) Income per Share [Abstract] | ||||
Anti-dilutive securities excluded from diluted earnings per share calculation (in shares) | 75,986 | 92,076 |
Contingencies (Details)
Contingencies (Details) $ in Thousands | Sep. 20, 2018shares | Aug. 28, 2017shares | Sep. 30, 2018USD ($)Lawsuit | May 26, 2017USD ($) | Jul. 02, 2014USD ($) |
Claims by Heirs of Former Shareholders [Member] | |||||
Contingencies [Abstract] | |||||
Number of shares awarded to plaintiff (in shares) | shares | 63,000 | ||||
Claims by Wanda Irizarry Antonmattei, et al. [Member] | |||||
Contingencies [Abstract] | |||||
Number of shares awarded to plaintiff (in shares) | shares | 63,000 | ||||
In re Blue Cross Blue Shield Antitrust Litigation [Member] | |||||
Contingencies [Abstract] | |||||
Lawsuit filing date | April 6, 2015 | ||||
Damages estimates of potential exposure towards providers after trebling | $ 15,000 | ||||
Potential trebled damages towards subscribers | $ 150,000 | ||||
Community Health Centers - Puerto Rico [Member] | |||||
Contingencies [Abstract] | |||||
Number of defending individual lawsuits | Lawsuit | 6 | ||||
Amount of claims for damages | $ 1,200 | ||||
Triple-S Salud, Inc [Member] | |||||
Contingencies [Abstract] | |||||
Overpayment of premium | $ 7,900 | ||||
Overpayment of premium dismissed | $ 7,400 | ||||
Amount of settlement agreement | $ 500 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)Segment | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) | ||
Segment Information [Abstract] | ||||||
Number of operating segments | Segment | 3 | |||||
Operating revenues [Abstract] | ||||||
Premiums earned, net | $ 742,445 | $ 714,325 | $ 2,236,249 | $ 2,139,489 | ||
Net investment income | 16,168 | 12,395 | 45,630 | 37,109 | ||
Consolidated operating revenues | 763,990 | 731,052 | 2,297,329 | 2,191,943 | ||
Operating income (loss) [Abstract] | ||||||
Consolidated operating (loss) income | (25,616) | 28,282 | (71,150) | 27,347 | ||
Consolidated net realized investment (losses) gains | (956) | 3,753 | 1,065 | 8,143 | ||
Consolidated net unrealized investment losses on equity investments | 5,632 | 0 | (11,343) | 0 | ||
Consolidated interest expense | (2,000) | (1,709) | (5,515) | (5,116) | ||
Consolidated other income, net | 1,943 | 3,409 | 3,600 | 6,521 | ||
Consolidated (loss) income before taxes | (20,997) | 33,735 | (83,343) | 36,895 | ||
Depreciation and amortization expense [Abstract] | ||||||
Depreciation and amortization expense | 2,947 | 3,381 | 9,933 | 9,835 | ||
Assets [Abstract] | ||||||
Assets | 2,818,428 | 2,818,428 | $ 3,116,765 | |||
Cash, cash equivalents, and investments | 1,722,798 | 1,722,798 | 1,804,418 | |||
Property and equipment, net | 78,445 | 78,445 | 74,716 | |||
Other assets | 66,093 | 66,093 | 46,996 | |||
Administrative Service [Member] | ||||||
Operating revenues [Abstract] | ||||||
Consolidated operating revenues | 3,802 | 3,391 | 11,216 | 12,318 | ||
Unallocated Amount to Segment [Member] | ||||||
Operating revenues [Abstract] | ||||||
TSM operating revenues from external sources | 446 | 87 | 1,254 | 220 | ||
Operating income (loss) [Abstract] | ||||||
TSM operating revenues from external sources | 446 | 87 | 1,254 | 220 | ||
TSM unallocated operating expenses | (1,780) | (2,759) | (6,575) | (7,876) | ||
Depreciation and amortization expense [Abstract] | ||||||
Depreciation and amortization expense | 197 | 197 | 590 | 590 | ||
Assets [Abstract] | ||||||
Assets | 104,369 | 104,369 | 126,189 | |||
Cash, cash equivalents, and investments | 59,496 | 59,496 | 81,169 | |||
Property and equipment, net | 21,326 | 21,326 | 22,257 | |||
Other assets | 23,547 | 23,547 | 22,763 | |||
Other Segments [Member] | ||||||
Operating revenues [Abstract] | ||||||
TSM operating revenues from external sources | [1] | 1,575 | 976 | 4,234 | 3,130 | |
Consolidated operating revenues | [1] | 1,570 | 3,772 | 4,517 | 9,771 | |
Operating income (loss) [Abstract] | ||||||
Operating income (loss) | [1] | 288 | 373 | 890 | 517 | |
TSM operating revenues from external sources | [1] | 1,575 | 976 | 4,234 | 3,130 | |
Depreciation and amortization expense [Abstract] | ||||||
Depreciation and amortization expense | [1] | 175 | 166 | 515 | 489 | |
Assets [Abstract] | ||||||
Assets | [1] | 20,787 | 20,787 | 19,027 | ||
Reportable Segment [Member] | ||||||
Operating revenues [Abstract] | ||||||
Consolidated operating revenues | 765,317 | 735,802 | 2,301,431 | 2,203,899 | ||
Operating income (loss) [Abstract] | ||||||
Operating income (loss) | (26,682) | 28,554 | (73,029) | 27,803 | ||
Depreciation and amortization expense [Abstract] | ||||||
Depreciation and amortization expense | 2,750 | 3,184 | 9,343 | 9,245 | ||
Assets [Abstract] | ||||||
Assets | 2,766,643 | 2,766,643 | 3,059,804 | |||
Reportable Segment [Member] | Managed Care [Member] | ||||||
Operating revenues [Abstract] | ||||||
Premiums earned, net | 680,393 | 653,734 | 2,044,989 | 1,955,246 | ||
Net investment income | 6,776 | 4,097 | 17,547 | 12,135 | ||
Consolidated operating revenues | 692,361 | 663,003 | 2,077,813 | 1,984,645 | ||
Operating income (loss) [Abstract] | ||||||
Operating income (loss) | 14,229 | 34,819 | 26,264 | 19,157 | ||
Depreciation and amortization expense [Abstract] | ||||||
Depreciation and amortization expense | 2,214 | 2,567 | 7,659 | 7,455 | ||
Assets [Abstract] | ||||||
Assets | 1,130,401 | 1,130,401 | 1,092,715 | |||
Reportable Segment [Member] | Managed Care [Member] | Administrative Service [Member] | ||||||
Operating revenues [Abstract] | ||||||
Consolidated operating revenues | 3,802 | 3,391 | 11,216 | 12,318 | ||
Reportable Segment [Member] | Life Insurance [Member] | ||||||
Operating revenues [Abstract] | ||||||
Premiums earned, net | 42,049 | 40,845 | 124,318 | 121,001 | ||
Net investment income | 6,428 | 6,070 | 19,105 | 18,487 | ||
Consolidated operating revenues | 48,712 | 47,022 | 144,255 | 139,897 | ||
Operating income (loss) [Abstract] | ||||||
Operating income (loss) | 5,681 | 4,477 | 14,637 | 13,402 | ||
Depreciation and amortization expense [Abstract] | ||||||
Depreciation and amortization expense | 272 | 315 | 868 | 913 | ||
Assets [Abstract] | ||||||
Assets | 852,750 | 852,750 | 853,289 | |||
Reportable Segment [Member] | Property and Casualty Insurance [Member] | ||||||
Operating revenues [Abstract] | ||||||
Premiums earned, net | 20,003 | 19,746 | 66,662 | 62,962 | ||
Net investment income | 2,518 | 2,106 | 7,724 | 6,164 | ||
Consolidated operating revenues | 22,674 | 22,005 | 74,846 | 69,586 | ||
Operating income (loss) [Abstract] | ||||||
Operating income (loss) | (46,880) | (11,115) | (114,820) | (5,273) | ||
Depreciation and amortization expense [Abstract] | ||||||
Depreciation and amortization expense | 89 | 136 | 301 | 388 | ||
Assets [Abstract] | ||||||
Assets | 762,705 | 762,705 | 1,094,773 | |||
Intersegment Elimination [Member] | ||||||
Operating revenues [Abstract] | ||||||
Premiums earned, net | (1,778) | (2,041) | (5,073) | (5,535) | ||
Consolidated operating revenues | 5 | (2,796) | (283) | (6,641) | ||
Operating income (loss) [Abstract] | ||||||
Elimination of TSM intersegment charges | 2,400 | 2,400 | 7,200 | 7,200 | ||
Assets [Abstract] | ||||||
Assets | (52,584) | (52,584) | $ (69,228) | |||
Intersegment Elimination [Member] | Managed Care [Member] | ||||||
Operating revenues [Abstract] | ||||||
Premiums earned, net | 1,390 | 1,781 | 4,061 | 4,946 | ||
Intersegment Elimination [Member] | Life Insurance [Member] | ||||||
Operating revenues [Abstract] | ||||||
Premiums earned, net | 235 | 107 | 832 | 409 | ||
Intersegment Elimination [Member] | Property and Casualty Insurance [Member] | ||||||
Operating revenues [Abstract] | ||||||
Premiums earned, net | 153 | 153 | 460 | 460 | ||
Intersegment Elimination [Member] | Other Segments [Member] | ||||||
Operating revenues [Abstract] | ||||||
Consolidated operating revenues | [1] | $ (5) | $ 2,796 | $ 283 | $ 6,641 | |
[1] | Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic. |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event [Member] - Hurricane Maria [Member] $ in Thousands | Nov. 02, 2018USD ($) |
Adverse Development Reinsurance [Abstract] | |
Retroactive portion | $ 50,000 |
Reinsurance coverage, net incurred losses | $ 76,500 |
Term of catastrophe umbrella coverage | 5 years |