Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 01, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-40399 | |
Entity Registrant Name | Enact Holdings, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 46-1579166 | |
Entity Address, Address Line One | 8325 Six Forks Road | |
Entity Address, City or Town | Raleigh | |
Entity Address, State or Province | NC | |
Entity Address, Postal Zip Code | 27615 | |
City Area Code | 919 | |
Local Phone Number | 846-4100 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | ACT | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | No | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 162,842,614 | |
Entity Central Index Key | 0001823529 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Investments: | ||
Fixed maturity securities available-for-sale, at fair value (amortized cost of $5,420,533 and $5,160,174 as of September 30, 2022 and December 31, 2021, respectively) | $ 4,877,902 | $ 5,266,339 |
Short-term investments, at fair value | 2,434 | 0 |
Total investments | 4,880,336 | 5,266,339 |
Cash and cash equivalents | 535,775 | 425,828 |
Accrued investment income | 35,896 | 31,061 |
Deferred acquisition costs | 26,310 | 27,220 |
Premiums receivable (net of allowance for credit losses of $834 and $948 as of September 30, 2022 and December 31, 2021, respectively) | 40,331 | 42,266 |
Deferred tax asset | 135,152 | 0 |
Other assets | 69,040 | 73,059 |
Total assets | 5,722,840 | 5,865,773 |
Liabilities: | ||
Loss reserves | 510,237 | 641,325 |
Unearned premiums | 212,987 | 246,319 |
Other liabilities | 140,413 | 130,604 |
Long-term borrowings | 742,211 | 740,416 |
Deferred tax liability | 0 | 1,586 |
Total liabilities | 1,605,848 | 1,760,250 |
Equity: | ||
Common stock ($0.01 par value, 600,000 shares authorized, 162,843 shares issued and outstanding) | 1,628 | 1,628 |
Additional paid-in capital | 2,379,576 | 2,371,861 |
Accumulated other comprehensive income | (427,085) | 83,581 |
Retained earnings | 2,162,873 | 1,648,453 |
Total equity | 4,116,992 | 4,105,523 |
Total liabilities and equity | $ 5,722,840 | $ 5,865,773 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Amortized cost | $ 5,420,533 | $ 5,160,174 |
Premiums receivable, allowance for credit losses | $ 834 | $ 948 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 600,000,000 | 600,000,000 |
Common stock, issued (in shares) | 162,843,000 | 162,843,000 |
Common stock, outstanding (in shares) | 162,843,000 | 162,843,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Revenues: | ||||
Premiums | $ 235,060 | $ 243,063 | $ 706,725 | $ 738,085 |
Net investment income | 39,493 | 35,995 | 110,415 | 105,943 |
Net investment gains (losses) | (42) | 580 | (762) | (2,129) |
Other income | 564 | 671 | 1,826 | 3,114 |
Total revenues | 275,075 | 280,309 | 818,204 | 845,013 |
Losses and expenses: | ||||
Losses incurred | (40,309) | 34,124 | (112,318) | 119,501 |
Acquisition and operating expenses, net of deferrals | 54,523 | 55,151 | 166,986 | 175,823 |
Amortization of deferred acquisition costs and intangibles | 3,338 | 3,669 | 9,658 | 11,104 |
Interest expense | 12,879 | 12,756 | 38,441 | 38,238 |
Total losses and expenses | 30,431 | 105,700 | 102,767 | 344,666 |
Income before income taxes | 244,644 | 174,609 | 715,437 | 500,347 |
Provision for income taxes | 53,658 | 37,401 | 155,086 | 107,196 |
Net income | $ 190,986 | $ 137,208 | $ 560,351 | $ 393,151 |
Net income per common share: | ||||
Basic (in usd per share) | $ 1.17 | $ 0.84 | $ 3.44 | $ 2.41 |
Diluted (in usd per share) | $ 1.17 | $ 0.84 | $ 3.43 | $ 2.41 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 162,843 | 162,840 | 162,842 | 162,840 |
Diluted (in shares) | 163,376 | 162,852 | 163,219 | 162,844 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 190,986 | $ 137,208 | $ 560,351 | $ 393,151 |
Other comprehensive income (loss), net of taxes: | ||||
Net unrealized gains (losses) on securities without an allowance for credit losses | (134,102) | (25,899) | (510,803) | (74,704) |
Net unrealized gains (losses) on securities with an allowance for credit losses | 0 | 0 | 0 | 0 |
Foreign currency translation | 44 | 0 | 137 | 0 |
Other comprehensive income (loss) | (134,058) | (25,899) | (510,666) | (74,704) |
Total comprehensive income (loss) | $ 56,928 | $ 111,309 | $ 49,685 | $ 318,447 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Equity - USD ($) $ in Thousands | Total | Cumulative effect of change in accounting, net of taxes | Common stock | Additional paid-in capital | Accumulated other comprehensive income (loss) | Accumulated other comprehensive income (loss) Cumulative effect of change in accounting, net of taxes | Retained earnings | Retained earnings Cumulative effect of change in accounting, net of taxes |
Beginning balance at Dec. 31, 2020 | $ 3,881,811 | $ 0 | $ 1,628 | $ 2,368,699 | $ 208,378 | $ 281 | $ 1,303,106 | $ (281) |
Net income | 393,151 | 393,151 | ||||||
Other comprehensive loss, net of taxes | (74,704) | (74,704) | ||||||
Stock-based compensation expense and exercises and other | 221 | 221 | ||||||
Capital contributions from Genworth Financial, Inc. | 902 | 902 | ||||||
Ending balance at Sep. 30, 2021 | 4,201,381 | 1,628 | 2,369,822 | 133,955 | 1,695,976 | |||
Beginning balance at Jun. 30, 2021 | 4,089,851 | 1,628 | 2,369,601 | 159,854 | 1,558,768 | |||
Net income | 137,208 | 137,208 | ||||||
Other comprehensive loss, net of taxes | (25,899) | (25,899) | ||||||
Stock-based compensation expense and exercises and other | 221 | 221 | ||||||
Ending balance at Sep. 30, 2021 | 4,201,381 | 1,628 | 2,369,822 | 133,955 | 1,695,976 | |||
Beginning balance at Dec. 31, 2021 | 4,105,523 | 1,628 | 2,371,861 | 83,581 | 1,648,453 | |||
Net income | 560,351 | 560,351 | ||||||
Other comprehensive loss, net of taxes | (510,666) | (510,666) | ||||||
Stock-based compensation expense and exercises and other | 7,380 | 7,715 | (335) | |||||
Dividends | (45,596) | (45,596) | ||||||
Ending balance at Sep. 30, 2022 | 4,116,992 | 1,628 | 2,379,576 | (427,085) | 2,162,873 | |||
Beginning balance at Jun. 30, 2022 | 4,080,500 | 1,628 | 2,377,042 | (293,027) | 1,994,857 | |||
Net income | 190,986 | 190,986 | ||||||
Other comprehensive loss, net of taxes | (134,058) | (134,058) | ||||||
Stock-based compensation expense and exercises and other | 2,362 | 2,534 | (172) | |||||
Dividends | (22,798) | (22,798) | ||||||
Ending balance at Sep. 30, 2022 | $ 4,116,992 | $ 1,628 | $ 2,379,576 | $ (427,085) | $ 2,162,873 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash flows from operating activities: | ||
Net income | $ 560,351 | $ 393,151 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Net investment losses | (762) | (2,129) |
Amortization of fixed maturity securities discounts and premiums | (1,992) | (6,884) |
Amortization of deferred acquisition costs and intangibles | 9,658 | 11,104 |
Acquisition costs deferred | (5,044) | (5,525) |
Deferred income taxes | 1,413 | 824 |
Stock-based compensation expense | 7,401 | 221 |
Amortization of debt issuance costs | 1,795 | 1,676 |
Other | (21) | 908 |
Change in certain assets and liabilities: | ||
Accrued investment income | (4,835) | (2,162) |
Premiums receivable | 1,935 | 3,039 |
Other assets | 381 | (4,666) |
Loss reserves | (131,088) | 92,686 |
Unearned premiums | (33,332) | (52,139) |
Other liabilities | (5,313) | (23,280) |
Net cash provided by operating activities | 402,071 | 411,082 |
Cash flows from investing activities: | ||
Purchases of fixed maturity securities available-for-sale | (1,069,759) | (1,192,098) |
Purchases of short-term investments | (2,453) | (12,500) |
Proceeds from sales of fixed maturity securities available-for-sale | 451,285 | 292,697 |
Proceeds from maturities of fixed maturity securities available-for-sale | 374,399 | 499,607 |
Net cash used in investing activities | (246,528) | (412,294) |
Cash flows from financing activities: | ||
Dividends paid | (45,596) | 0 |
Net cash used in financing activities | (45,596) | 0 |
Net increase (decrease) in cash and cash equivalents | 109,947 | (1,212) |
Cash and cash equivalents at beginning of period | 425,828 | 452,794 |
Cash and cash equivalents at end of period | $ 535,775 | $ 451,582 |
Nature of Business, Organizatio
Nature of Business, Organization Structure and Basis of Presentation | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business, Organization Structure and Basis of Presentation | Nature of Business, Organization Structure and Basis of Presentation The accompanying unaudited condensed consolidated financial statements include, on a consolidated basis, the accounts of Enact Holdings, Inc. (“EHI,” together with its subsidiaries, the “Company,” “we,” “us” or “our”) (formerly known as Genworth Mortgage Holdings, Inc.). EHI is a subsidiary of Genworth Financial, Inc. (“Genworth” or “Parent”) and has been since EHI’s incorporation in Delaware in 2012. We are engaged in the business of writing and assuming residential mortgage guaranty insurance. The insurance protects lenders and investors against certain losses resulting from nonpayment of loans secured by mortgages, deeds of trust, or other instruments constituting a lien on residential real estate. On May 3, 2021, EHI amended its certificate of incorporation to change its name from Genworth Mortgage Holdings, Inc. This amendment also authorized EHI to issue 600,000,000 shares of common stock, each having a par value of $0.01 per share. Concurrently, we entered into a share exchange agreement with Genworth Holdings, Inc. (“Genworth Holdings”), pursuant to which Genworth Holdings exchanged its 100 shares of common stock, representing all of the previously issued and outstanding capital stock, for 162,840,000 newly-issued shares of common stock, par value $0.01, of EHI. All of the share and per share information presented in the condensed consolidated financial statements and notes to the condensed consolidated financial statements have been adjusted to reflect the share exchange on a retroactive basis for all periods and as of all dates presented. On September 15, 2021, we priced our initial public offering (“IPO”) of common stock, which resulted in the issuance and sale of 13,310,400 shares of common stock at the IPO price of $19.00 per common share. All shares were offered by the selling stockholder, our parent company, Genworth Holdings. In addition to the shares sold in the IPO, 14,655,600 common shares were sold in a concurrent private sale (“Private Sale”) at a price per share of $17.86, which is equal to the IPO price less the underwriting discount share. Genworth Holdings also granted the underwriters a 30-day option to purchase up to an additional 1,996,560 common shares (“Over-Allotment Option”) at the IPO price less the underwriting discount. On September 16, 2021, the underwriters exercised their option to purchase all 1,996,560 common shares permitted under the terms of the underwriting agreement. The IPO, Private Sale and Over-Allotment Option (collectively the “Offering”) closed on September 20, 2021, and Genworth Holdings retained all net proceeds from the Offering. The gross proceeds of the Offering, before payment of underwriter fees and other expenses, were approximately $553 million. Costs directly related to the Offering, including underwriting fees and other expenses, were approximately $24 million. We offer private mortgage insurance products predominantly insuring prime-based, individually underwritten residential mortgage loans (“primary mortgage insurance”). Our primary mortgage insurance enables borrowers to buy homes with a down payment of less than 20% of the home’s value. Primary mortgage insurance also facilitates the sale of these low down payment mortgage loans in the secondary mortgage market, most of which are sold to government sponsored enterprises. We also selectively enter into insurance transactions with lenders and investors, under which we insure a portfolio of loans at or after origination. We operate our business through our primary insurance subsidiary, Enact Mortgage Insurance Corporation, (“EMICO”), formerly known as Genworth Mortgage Insurance Corporation, with operations in all 50 states and the District of Columbia. We completed name changes to some of our subsidiary legal entities during the first quarter of 2022. EMICO is an approved insurer by the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”). Fannie Mae and Freddie Mac are government-sponsored enterprises and we refer to them collectively as the “GSEs.” We also perform fee-based contract underwriting services for mortgage lenders. The provision of underwriting services by mortgage insurers eliminates the duplicative lender and mortgage insurer underwriting activities and expedites the approval process. We operate our business in a single segment, which is how our chief operating decision maker (who is our Chief Executive Officer) reviews our financial performance and allocates resources. Our segment includes a run-off insurance block with reference properties in Mexico (“run-off business”), which is immaterial to our condensed consolidated financial statements. |
Accounting Changes
Accounting Changes | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Accounting Changes | Accounting Changes Accounting Pronouncements Recently Adopted We have not adopted new accounting pronouncements in 2022. Accounting Pronouncements Not Yet Adopted There are no significant new accounting pronouncements impacting our financial statements. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments Net Investment Income Sources of net investment income were as follows for the periods indicated: Three months ended Nine months ended (Amounts in thousands) 2022 2021 2022 2021 Fixed maturity securities available-for-sale $ 38,450 $ 37,055 $ 111,794 $ 110,007 Cash, cash equivalents and short-term investments 2,423 13 2,854 65 Gross investment income before expenses and fees 40,873 37,068 114,648 110,072 Investment expenses and fees (1,380) (1,073) (4,233) (4,129) Net investment income $ 39,493 $ 35,995 $ 110,415 $ 105,943 Net Investment Gains (Losses) The following table sets forth net investment gains (losses) for the periods indicated: Three months ended Nine months ended (Amounts in thousands) 2022 2021 2022 2021 Fixed maturity securities available-for-sale: Gross realized gains $ 573 $ 839 $ 1,214 $ 1,423 Gross realized (losses) (615) (128) (2,149) (1,261) Net realized gains (losses) (42) 711 (935) 162 Net change in allowance for credit losses on fixed maturity securities available-for-sale — (131) 173 (2,291) Net investment gains (losses) $ (42) $ 580 $ (762) $ (2,129) There was no recorded allowance for credit losses for fixed maturity securities available-for-sale as of and for the three and nine months ended September 30, 2022. There was no recorded allowance for credit losses for fixed maturity securities available-for-sale as of and for the three months ended September 30, 2021. The following table represents the allowance for credit losses aggregated by security type for fixed maturity available-for-sale securities as of and for the nine months ended September 30, 2021: (Amounts in thousands) Beginning balance Cumulative effect of change in accounting Increase from securities without allowance in previous periods Securities sold Ending balance Fixed maturity securities: Non-U.S. corporate $ — $ 357 $ 2,157 $ (2,514) $ — Total fixed maturity securities available-for-sale $ — $ 357 $ 2,157 $ (2,514) $ — Unrealized Investment Gains (Losses) Net unrealized gains and losses on available-for-sale securities reflected as a separate component of accumulated other comprehensive income (“AOCI”) were as follows as of the dates indicated: (Amounts in thousands) September 30, 2022 December 31, 2021 Net unrealized gains (losses) on investment securities: Fixed maturity securities $ (542,631) $ 106,165 Short-term investments (19) — Unrealized gains (losses) on investment securities (542,650) 106,165 Income taxes 115,435 (22,577) Net unrealized investment gains (losses) $ (427,215) $ 83,588 The change in net unrealized gains (losses) on available-for-sale securities reported in accumulated other comprehensive income was as follows as of and for the periods indicated: Three months ended (Amounts in thousands) 2022 2021 Beginning balance $ (293,113) $ 159,854 Unrealized gains (losses) arising during the period: Unrealized gains (losses) on investment securities (170,400) (32,185) Provision for income taxes 36,265 6,848 Change in unrealized gains (losses) on investment securities (134,135) (25,337) Reclassification adjustments to net investment (gains) losses, net of taxes of $(9) and $149, respectively 33 (562) Change in net unrealized investment gains (losses) (134,102) (25,899) Ending balance $ (427,215) $ 133,955 Nine months ended (Amounts in thousands) 2022 2021 Beginning balance $ 83,588 $ 208,378 Cumulative effect of change in accounting, net of taxes — 281 Unrealized gains (losses) arising during the period: Unrealized gains (losses) on investment securities (649,750) (94,724) Provision for income taxes 138,209 20,148 Change in unrealized gains (losses) on investment securities (511,541) (74,576) Reclassification adjustments to net investment (gains) losses, net of taxes of $(197) and $34, respectively 738 (128) Change in net unrealized investment gains (losses) (510,803) (74,704) Ending balance $ (427,215) $ 133,955 Amounts reclassified out of accumulated other comprehensive income to net investment gains (losses) include realized gains (losses) on sales of securities, which are determined on a specific identification basis. Fixed Maturity Securities Available-For-Sale As of September 30, 2022, the amortized cost, gross unrealized gains (losses) and fair value of our investment securities were as follows: (Amounts in thousands) Amortized cost Gross unrealized gains Gross unrealized losses Fair value U.S. government, agencies and GSEs $ 46,322 $ 66 $ (1,734) $ 44,654 State and political subdivisions 528,255 2,429 (98,455) 432,229 Non-U.S. government 10,643 — (1,391) 9,252 U.S. corporate 2,918,599 275 (279,690) 2,639,184 Non-U.S. corporate 721,819 17 (74,773) 647,063 Residential mortgage-backed 11,941 — (198) 11,743 Other asset-backed 1,182,954 14 (89,191) 1,093,777 Total fixed maturity securities available-for-sale $ 5,420,533 $ 2,801 $ (545,432) $ 4,877,902 Short-term investments 2,453 — (19) 2,434 Total investments available-for-sale $ 5,422,986 $ 2,801 $ (545,451) $ 4,880,336 As of December 31, 2021, the amortized cost, gross unrealized gains (losses) and fair value of our investment securities were as follows: (Amounts in thousands) Amortized cost Gross unrealized gains Gross unrealized losses Fair value U.S. government, agencies and GSEs $ 56,547 $ 1,863 $ (2) $ 58,408 State and political subdivisions 531,927 10,982 (4,456) 538,453 Non-U.S. government 22,358 248 (190) 22,416 U.S. corporate 2,863,100 98,293 (16,090) 2,945,303 Non-U.S. corporate 652,503 17,556 (3,465) 666,594 Other asset-backed 1,033,739 6,989 (5,563) 1,035,165 Total fixed maturity securities available-for-sale $ 5,160,174 $ 135,931 $ (29,766) $ 5,266,339 There was no allowance for credit losses recorded fixed maturity securities classified as available-for-sale as of September 30, 2022 or December 31, 2021. Gross Unrealized Losses and Fair Values of Fixed Maturity Securities Available-For-Sale The following table presents the gross unrealized losses and fair values of our fixed maturity securities for which an allowance for credit losses has not been recorded, aggregated by investment type and length of time that individual fixed maturity securities have been in a continuous unrealized loss position, as of September 30, 2022: Less than 12 months 12 months or more Total (Amounts in thousands) Fair value Gross unrealized losses Number of securities Fair value Gross unrealized losses Number of securities Fair value Gross unrealized losses Number of securities Fixed maturity securities: U.S. government, agencies and GSEs $ 43,752 $ (1,724) 18 $ 95 $ (10) 1 $ 43,847 $ (1,734) 19 State and political subdivisions 315,865 (74,515) 63 84,279 (23,940) 26 400,144 (98,455) 89 Non-U.S. government — — — 9,252 (1,391) 1 9,252 (1,391) 1 U.S. corporate 2,289,613 (199,380) 522 347,057 (80,310) 56 2,636,670 (279,690) 578 Non-U.S. corporate 540,135 (52,646) 136 101,487 (22,127) 18 641,622 (74,773) 154 Residential mortgage-backed 11,743 (198) 6 — — — 11,743 (198) 6 Other asset-backed 906,744 (66,738) 261 162,110 (22,453) 33 1,068,854 (89,191) 294 Total for fixed maturity securities in an unrealized loss position $ 4,107,852 $ (395,201) 1,006 $ 704,280 $ (150,231) 135 $ 4,812,132 $ (545,432) 1,141 We did not recognize an allowance for credit losses on securities in an unrealized loss position included in the table above. Based on a qualitative and quantitative review of the issuers of the securities, we believe the decline in fair value is largely due to rising interest rates and recent market volatility, and is not indicative of credit losses. The issuers continue to make timely principal and interest payments. For all securities in an unrealized loss position without an allowance for credit losses, we expect to recover the amortized cost based on our estimate of the amount and timing of cash flows to be collected. We do not intend to sell nor do we expect that we will be required to sell these securities prior to recovering our amortized cost. The following table presents the gross unrealized losses and fair values of our fixed maturity securities, aggregated by investment type and length of time that individual fixed maturity securities have been in a continuous unrealized loss position, as of December 31, 2021: Less than 12 months 12 months or more Total (Amounts in thousands) Fair value Gross unrealized losses Number of securities Fair value Gross unrealized losses Number of securities Fair value Gross unrealized losses Number of securities Fixed maturity securities: U.S. government, agencies and GSEs $ 103 $ (2) 1 $ — $ — — $ 103 $ (2) 1 State and political subdivisions 255,202 (4,456) 47 — — — 255,202 (4,456) 47 Non-U.S. government 10,560 (190) 1 — — — 10,560 (190) 1 U.S. corporate 649,927 (14,300) 94 26,181 (1,790) 4 676,108 (16,090) 98 Non-U.S. corporate 183,485 (3,465) 28 — — — 183,485 (3,465) 28 Other asset-backed 456,565 (5,549) 76 3,736 (14) 1 460,301 (5,563) 77 Total for fixed maturity securities in an unrealized loss position $ 1,555,842 $ (27,962) 247 $ 29,917 $ (1,804) 5 $ 1,585,759 $ (29,766) 252 Contractual Maturities of Fixed Maturity Securities Available-For-Sale The scheduled maturity distribution of fixed maturity securities as of September 30, 2022, is set forth below. Actual maturities may differ from contractual maturities because issuers of securities may have the right to call or prepay obligations with or without call or prepayment penalties. (Amounts in thousands) Amortized cost Fair value Due one year or less $ 214,145 $ 212,697 Due after one year through five years 2,154,780 2,013,369 Due after five years through ten years 1,569,701 1,314,043 Due after ten years 287,012 232,273 Subtotal 4,225,638 3,772,382 Residential mortgage-backed 11,941 11,743 Other asset-backed 1,182,954 1,093,777 Total fixed maturity securities available-for-sale $ 5,420,533 $ 4,877,902 As of September 30, 2022, securities issued by the finance and insurance, technology and communications, and consumer—non-cyclical industry groups represented approximately 32%, 14%, and 12%, respectively, of our domestic and foreign corporate fixed maturity securities portfolio. No other industry group comprised more than 9% of our investment portfolio. As of September 30, 2022, we did not hold any fixed maturity securities in any single issuer, other than securities issued or guaranteed by the U.S. government, which exceeded 10% of equity. As of September 30, 2022 and December 31, 2021, $25.1 million and $22.9 million, respectively, of securities in our portfolio were on deposit with various state insurance commissioners in order to comply with relevant insurance regulations. |
Fair Value
Fair Value | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value Recurring Fair Value Measurements We hold fixed maturity securities and short-term investments, which are carried at fair value. The fair value of fixed maturity securities and short-term investments are estimated primarily based on information derived from third-party pricing services (“pricing services”), internal models and/or broker quotes, which use a market approach, income approach or a combination of the market and income approach depending on the type of instrument and availability of information. In general, a market approach is utilized if there is readily available and relevant market activity for an individual security. In certain cases where market information is not available for a specific security but is available for similar securities, that security is valued using market information for similar securities, which is also a market approach. When market information is not available for a specific security (or similar securities) or is available but such information is less relevant or reliable, an income approach or a combination of a market and income approach is utilized. For securities with optionality, such as call or prepayment features (including asset-backed securities), an income or combination approach may be used. These valuation techniques may change from period to period, based on the relevance and availability of market data. Further, while we consider the valuations provided by pricing services and broker quotes to be of high quality, management determines the fair value of our investment securities after considering all relevant and available information. In general, we first obtain valuations from pricing services. If prices are unavailable for public securities, we obtain broker quotes. For all securities, excluding certain private fixed maturity securities, if neither a pricing service nor broker quotes valuation is available, we determine fair value using internal models. For certain private fixed maturity securities where we do not obtain valuations from pricing services, we utilize an internal model to determine fair value since transactions for similar securities are not readily observable and these securities are not typically valued by pricing services. Given our understanding of the pricing methodologies and procedures of pricing services, the securities valued by pricing services are typically classified as Level 2 unless we determine the valuation process for a security or group of securities utilizes significant unobservable inputs, which would result in the valuation being classified as Level 3. Broker quotes are typically based on an income approach given the lack of available market data. As the valuation typically includes significant unobservable inputs, we classify the securities where fair value is based on our consideration of broker quotes as Level 3 measurements. For private fixed maturity securities, we utilize an income approach where we obtain public bond spreads and utilize those in an internal model to determine fair value. Other inputs to the model include rating and weighted-average life, as well as sector which is used to assign the spread. We then add an additional premium, which represents an unobservable input, to the public bond spread to adjust for the liquidity and other features of our private placements. We utilize the estimated market yield to discount the expected cash flows of the security to determine fair value. We utilize price caps for securities where the estimated market yield results in a valuation that may exceed the amount that would be received in a market transaction. When a security does not have an external rating, we assign the security an internal rating to determine the appropriate public bond spread that should be utilized in the valuation. While we generally consider the public bond spreads by sector and maturity to be observable inputs, we evaluate the similarities of our private placement with the public bonds, any price caps utilized, liquidity premiums applied, and whether external ratings are available for our private placements to determine whether the spreads utilized would be considered observable inputs. We classify private securities without an external rating or public bond spread as Level 3. In general, a significant increase (decrease) in credit spreads would have resulted in a significant decrease (increase) in the fair value for our fixed maturity securities as of September 30, 2022. For remaining securities priced using internal models, we determine fair value using an income approach. We maximize the use of observable inputs but typically utilize significant unobservable inputs to determine fair value. Accordingly, the valuations are typically classified as Level 3. Our assessment of whether or not there were significant unobservable inputs related to fixed maturity securities was based on our observations obtained through the course of managing our investment portfolio, including interaction with other market participants, observations related to the availability and consistency of pricing and/or rating, and understanding of general market activity such as new issuance and the level of secondary market trading for a class of securities. Additionally, we considered data obtained from pricing services to determine whether our estimated values incorporate significant unobservable inputs that would result in the valuation being classified as Level 3. A summary of the inputs used for our fixed maturity securities and short-term investments based on the level in which instruments are classified is included below. We have combined certain classes of instruments together as the nature of the inputs is similar. Level 1 measurements There were no fixed maturity securities classified as Level 1 as of September 30, 2022, and December 31, 2021. Level 2 measurements Fixed maturity securities: Third-party pricing services In estimating the fair value of fixed maturity securities, approximately 89% of our portfolio was priced using third-party pricing services as of September 30, 2022. These pricing services utilize industry-standard valuation techniques that include market-based approaches, income-based approaches, a combination of market-based and income-based approaches or other proprietary, internally generated models as part of the valuation processes. These third-party pricing vendors maximize the use of publicly available data inputs to generate valuations for each asset class. Priority and type of inputs used may change frequently as certain inputs may be more direct drivers of valuation at the time of pricing. Examples of significant inputs incorporated by pricing services may include sector and issuer spreads, seasoning, capital structure, security optionality, collateral data, prepayment assumptions, default assumptions, delinquencies, debt covenants, benchmark yields, trade data, dealer quotes, credit ratings, maturity and weighted-average life. We conduct regular meetings with our pricing services for the purpose of understanding the methodologies, techniques and inputs used by the third-party pricing providers. The following table presents a summary of the significant inputs used by our pricing services for certain fair value measurements of fixed maturity securities that are classified as Level 2 as of September 30, 2022: (Amounts in thousands) Fair value Primary methodologies Significant inputs U.S. government, agencies and GSEs $ 44,654 Price quotes from trading desk, broker feeds Bid side prices, trade prices, Option Adjusted Spread (“OAS”) to swap curve, Bond Market Association OAS, Treasury Curve, Agency Bullet Curve, maturity to issuer spread State and political subdivisions $ 432,229 Multi-dimensional attribute-based modeling systems, third-party pricing vendors Trade prices, material event notices, Municipal Market Data benchmark yields, broker quotes Non-U.S. government $ 9,252 Matrix pricing, spread priced to benchmark curves, price quotes from market makers Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources U.S. corporate $ 2,256,976 Multi-dimensional attribute-based modeling systems, broker quotes, price quotes from market makers, internal models, OAS-based models Bid side prices to Treasury Curve, Issuer Curve, which includes sector, quality, duration, OAS percentage and change for spread matrix, trade prices, comparative transactions, Trade Reporting and Compliance Engine (“TRACE”) reports Non-U.S. corporate $ 476,784 Multi-dimensional attribute-based modeling systems, OAS-based models, price quotes from market makers Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources Residential mortgage-backed $ 11,743 OAS-based models, single factor binomial models, internally priced Prepayment and default assumptions, aggregation of bonds with similar characteristics, including collateral type, vintage, tranche type, weighted-average life, weighted-average loan age, issuer program and delinquency ratio, pay up and pay down factors, TRACE reports Other asset-backed $ 1,086,134 Multi-dimensional attribute-based modeling systems, spread matrix priced to swap curves, price quotes from market makers Spreads to daily updated swap curves, spreads derived from trade prices and broker quotes, bid side prices, new issue data, collateral performance, analysis of prepayment speeds, cash flows, collateral loss analytics, historical issue analysis, trade data from market makers, TRACE reports Internal models A portion of our Level 2 U.S. corporate and non-U.S. corporate securities are valued using internal models. The fair value of these fixed maturity securities was $165.3 million and $91.7 million, respectively, as of September 30, 2022. Internally modeled securities are primarily private fixed maturity securities where we use market observable inputs such as an interest rate yield curve, published credit spreads for similar securities based on the external ratings of the instrument and related industry sector of the issuer. Additionally, we may apply certain price caps and liquidity premiums in the valuation of private fixed maturity securities. Price caps and liquidity premiums are established using inputs from market participants. Short-term investments: The fair value of short-term investments classified as Level 2 is determined after considering prices obtained by pricing services. Level 3 measurements Broker quotes A portion of our U.S. corporate and other asset-backed securities are valued using broker quotes. Broker quotes are obtained from third-party providers that have current market knowledge to provide a reasonable price for securities not routinely priced by pricing services. Brokers utilized for valuation of assets are reviewed annually. The fair value of our Level 3 fixed maturity securities priced by broker quotes was $10.8 million as of September 30, 2022. Internal models A portion of our U.S. corporate and non-U.S. corporate securities are valued using internal models. The primary inputs to the valuation of the bond population include quoted prices for identical assets, or similar assets in markets that are not active, contractual cash flows, duration, call provisions, issuer rating, benchmark yields and credit spreads. Certain private fixed maturity securities are valued using an internal model using market observable inputs such as the interest rate yield curve, as well as published credit spreads for similar securities, which includes significant unobservable inputs. Additionally, we may apply certain price caps and liquidity premiums in the valuation of private fixed maturity securities. Price caps are established using inputs from market participants. For structured securities, the primary inputs to the valuation include quoted prices for identical assets, or similar assets in markets that are not active, contractual cash flows, weighted-average coupon, weighted-average maturity, issuer rating, structure of the security, expected prepayment speeds and volumes, collateral type, current and forecasted loss severity, average delinquency rates, vintage of the loans, geographic region, debt service coverage ratios, payment priority with the tranche, benchmark yields and credit spreads. The fair value of our Level 3 fixed maturity securities priced using internal models was $292.3 million as of September 30, 2022. The following tables set forth our assets by class of instrument that are measured at fair value on a recurring basis as of the dates indicated: September 30, 2022 (Amounts in thousands) Total Level 1 Level 2 Level 3 Fixed maturity securities: U.S. government, agencies and GSEs $ 44,654 $ — $ 44,654 $ — State and political subdivisions 432,229 — 432,229 — Non-U.S. government 9,252 — 9,252 — U.S. corporate 2,639,184 — 2,422,247 216,937 Non-U.S. corporate 647,063 — 568,447 78,616 Residential mortgage-backed 11,743 — 11,743 — Other asset-backed 1,093,777 — 1,086,134 7,643 Total fixed maturity securities 4,877,902 — 4,574,706 303,196 Short-term investments 2,434 — 2,434 — Total $ 4,880,336 $ — $ 4,577,140 $ 303,196 December 31, 2021 (Amounts in thousands) Total Level 1 Level 2 Level 3 Fixed maturity securities: U.S. government, agencies and GSEs $ 58,408 $ — $ 58,408 $ — State and political subdivisions 538,453 — 538,453 — Non-U.S. government 22,416 — 22,416 — U.S. corporate 2,945,303 — 2,724,570 220,733 Non-U.S. corporate 666,594 — 582,930 83,664 Other asset-backed 1,035,165 — 1,010,942 24,223 Total $ 5,266,339 $ — $ 4,937,719 $ 328,620 We had no liabilities recorded at fair value as of September 30, 2022, and December 31, 2021. The following tables present additional information about assets measured at fair value on a recurring basis and for which we have utilized significant unobservable (Level 3) inputs to determine fair value as of or for the dates indicated: Beginning Total realized and unrealized gains (losses) Purchases Settlements Transfer into Level 3 (1) Transfer out of Level 3 (1) Ending Total gains (losses) attributable to assets still held (Amounts in thousands) Included in net income Included in OCI Included in net income Included in OCI Fixed maturity securities: U.S. corporate $ 216,654 $ (14) $ (9,292) $ 9,999 $ (410) $ — $ — $ 216,937 $ (14) $ (9,293) Non-U.S. corporate 83,305 (86) (2,498) 8,000 (10,105) — — 78,616 (86) (2,501) Other asset-backed 15,054 — (523) 7,823 — — (14,711) 7,643 — (180) Total $ 315,013 $ (100) $ (12,313) $ 25,822 $ (10,515) $ — $ (14,711) $ 303,196 $ (100) $ (11,974) Beginning Total realized and unrealized gains (losses) Purchases Settlements Transfer into Level 3 (1) Transfer out of Level 3 (1) Ending Total gains (losses) attributable to assets still held (Amounts in thousands) Included in net income Included in OCI Included in net income Included in OCI Fixed maturity securities: U.S. corporate $ 129,613 $ (30) $ (2,778) $ 53,000 $ (3,426) $ 4,318 $ (3,010) $ 177,687 $ (30) $ (2,769) Non-U.S. corporate 91,157 958 (644) 6,000 (14,148) 3,010 — 86,333 (83) 235 Other asset-backed 10,015 — (170) 10,000 (1,459) — — 18,386 — (146) Total $ 230,785 $ 928 $ (3,592) $ 69,000 $ (19,033) $ 7,328 $ (3,010) $ 282,406 $ (113) $ (2,680) ______________ (1) The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads. Beginning Total realized and unrealized gains (losses) Purchases Settlements Transfer into Level 3 (1) Transfer out of Level 3 (1) Ending Total gains (losses) attributable to assets still held (Amounts in thousands) Included in net income Included in OCI Included in net income Included in OCI Fixed maturity securities: U.S. corporate $ 220,733 $ (42) $ (39,462) $ 49,968 $ (850) $ — $ (13,410) $ 216,937 $ (42) $ (38,970) Non-U.S. corporate 83,664 (254) (11,768) 21,009 (10,316) — (3,719) 78,616 (254) (11,476) Other asset-backed 24,223 — (2,090) 22,820 — — (37,310) 7,643 — (123) Total $ 328,620 $ (296) $ (53,320) $ 93,797 $ (11,166) $ — $ (54,439) $ 303,196 $ (296) $ (50,569) (Amounts in thousands) Beginning Total realized and Purchases Settlements Transfer into Level 3 (1) Transfer out of Level 3 (1) Ending Total gains Included Included Included in net income Included in OCI Fixed maturity securities: U.S. corporate $ 119,373 $ (92) $ (3,750) $ 71,000 $ (8,914) $ 7,397 $ (7,327) $ 177,687 $ (92) $ (4,029) Non-U.S. corporate 95,751 868 3,147 42,786 (25,044) 3,010 (34,185) 86,333 (168) (683) Other asset-backed 13,781 — (104) 10,000 (2,723) — (2,568) 18,386 — (130) Total $ 228,905 $ 776 $ (707) $ 123,786 $ (36,681) $ 10,407 $ (44,080) $ 282,406 $ (260) $ (4,842) ______________ (1) The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads. Purchases, sales, issuances and settlements represent the activity that occurred during the period that results in a change of the asset but does not represent changes in fair value for the instruments held at the beginning of the period. Such activity consists of purchases, sales and settlements of fixed maturity securities. The amount presented for realized and unrealized gains (losses) included in net income for fixed maturity securities primarily represents amortization and accretion of premiums and discounts on certain fixed maturity securities recorded within net investment income. The following table presents a summary of the significant unobservable inputs used for certain asset fair value measurements that are based on internal models and classified as Level 3 as of September 30, 2022: (Amounts in thousands) Valuation technique Fair value (1) Unobservable input Range (bps) Weighted- average (2) (bps) Fixed maturity securities: U.S. corporate Internal models $ 213,731 Credit spreads 50 - 230 153 Non-U.S. corporate Internal models $ 78,614 Credit spreads 91 - 242 159 ______________ (1) Certain classes of instruments classified as Level 3 are excluded as a result of not being material or due to limitations in being able to obtain the underlying inputs used by certain third-party sources, such as broker quotes, used as an input in determining fair value. (2) Unobservable inputs weighted by the relative fair value of the associated instrument. Liabilities Not Required to Be Carried at Fair Value We have certain financial instruments that are not recorded at fair value, including cash and cash equivalents and accrued investment income, the carrying value of which approximate fair value due to the short-term nature of these instruments and are not included in this disclosure. The following represents our estimated fair value of financial liabilities that are not required to be carried at fair value, classified as Level 2, as of the dates indicated: September 30, 2022 December 31, 2021 (Amounts in thousands) Carrying amount Fair value Carrying amount Fair value Long-term borrowings $ 742,211 $ 719,213 $ 740,416 $ 821,033 |
Loss Reserves
Loss Reserves | 9 Months Ended |
Sep. 30, 2022 | |
Insurance [Abstract] | |
Loss Reserves | Loss Reserves Activity for the liability for loss reserves for the nine months ended September 30, is summarized as follows: (Amounts in thousands) 2022 2021 Loss reserves, beginning balance $ 641,325 $ 555,679 Run-off reserves (681) (654) Net loss reserves, beginning balance 640,644 555,025 Losses and LAE incurred related to current accident year 138,504 104,939 Losses and LAE incurred related to prior accident years (250,799) 14,468 Total incurred (1) (112,295) 119,407 Losses and LAE paid related to current accident year (1,005) (1,574) Losses and LAE paid related to prior accident years (17,772) (25,194) Total paid (1) (18,777) (26,768) Net loss reserves, ending balance 509,572 647,664 Run-off reserves 665 701 Loss reserves, ending balance $ 510,237 $ 648,365 ______________ (1) Losses and loss adjustment expenses (“LAE”) incurred and paid exclude losses related to our run-off business. The liability for loss reserves represents our current best estimate; however, there may be future adjustments to this estimate and related assumptions. Such adjustments, reflecting any variety of new and adverse trends, could possibly be significant, and result in future increases to reserves by amounts that could be material to our results of operations, financial condition and liquidity. Losses incurred related to insured events of the current accident year relate to defaults that occurred in that year and represent the estimated ultimate amount of losses to be paid on such defaults. Losses incurred related to insured events of prior accident years represent the (favorable) or unfavorable development of reserves as a result of the actual rates at which delinquencies go to claim (“claim rates”) and claim amounts being different than those we estimated when originally establishing the reserves. Such estimates are based on our historical experience, which we believe is representative of expected future losses at the time of estimation. As a result of the extended period of time that may exist between the reporting of a delinquency and the claim payment, as well as changes in economic conditions and the real estate market, significant uncertainty and variability exist on amounts ultimately paid. For the nine months ended September 30, 2022, losses and LAE incurred of $139 million related to insured events of the current accident year was primarily attributable to new delinquencies, a portion of which was from borrowers participating in deferred or reduced payments (“forbearance”) as a result of COVID-19. When establishing loss reserves for borrowers in forbearance, we assume a lower rate of delinquencies becoming active claims, which has the effect of producing a lower reserve compared to delinquencies that are not in forbearance. Historical experience with localized natural disasters, such as hurricanes, indicates a higher cure rate for borrowers in forbearance. Unlike a hurricane where the natural disaster occurs at a point in time and the rebuild starts soon after, COVID-19 brought ongoing displacement to the mortgage insurance market, making it more difficult to determine the effectiveness of forbearance and the resulting claim rates for new delinquencies in forbearance plans. Given this difference, we initially leveraged our prior hurricane experience and have recently layered in cure activity from COVID-19 related delinquencies as considerations in the establishment of an appropriate claim rate estimate for new delinquencies in forbearance plans that have emerged as a result of COVID-19. Loss reserves recorded on these new delinquencies have a high degree of estimation due to the level of uncertainty regarding whether delinquencies in forbearance will ultimately cure or result in claim payments. Losses in current accident year were also impacted by $25 million of reserve strengthening due to uncertainty in the current economic environment. We also recorded favorable adjustments on prior accident year reserves of $251 million, which was primarily driven by performance of delinquencies from 2020 related to the emergence of COVID-19. During the peak of COVID-19, we experienced elevated new delinquencies subject to forbearance plans. Those delinquencies have continued to cure at levels above our reserve expectations. During the first nine months of 2021, existing reserves were strengthened by $10 million primarily driven by slower early cure emergence patterns on pre-COVID-19 delinquencies. |
Reinsurance
Reinsurance | 9 Months Ended |
Sep. 30, 2022 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | |
Reinsurance | Reinsurance We reinsure a portion of our policy risks in order to reduce our ultimate losses, diversify our exposures and comply with regulatory requirements. We also assume certain policy risks written by other companies. Reinsurance does not relieve us from our obligations to policyholders. In the event that the reinsurers are unable to meet their obligations, we remain liable for the reinsured claims. We monitor both the financial condition of individual reinsurers and risk concentrations arising from similar geographic regions, activities and economic characteristics of reinsurers to lessen the risk of default by such reinsurers. The following table sets forth the effects of reinsurance on premiums written and earned for the periods indicated: Three months ended Nine months ended (Amounts in thousands) 2022 2021 2022 2021 Net premiums written: Direct $ 243,655 $ 252,719 $ 732,079 $ 738,848 Assumed 64 78 198 249 Ceded (20,453) (18,500) (58,884) (53,150) Net premiums written $ 223,266 $ 234,297 $ 673,393 $ 685,947 Net premiums earned: Direct $ 255,449 $ 261,485 $ 765,411 $ 790,986 Assumed 64 78 198 249 Ceded (20,453) (18,500) (58,884) (53,150) Net premiums earned $ 235,060 $ 243,063 $ 706,725 $ 738,085 The difference between written premiums of $223.3 million and earned premiums of $235.1 million represents the decrease in unearned premiums for the three months ended September 30, 2022. The difference between written premiums of $673.4 million and earned premiums of $706.7 million represents the decrease in unearned premiums for the nine months ended September 30, 2022. The decrease in unearned premiums for each period was primarily the result of policy cancellations in our single premium mortgage insurance product. Insurance-linked note excess of loss reinsurance treaties On September 2, 2021, we obtained $371.5 million of excess of loss reinsurance coverage from Triangle Re 2021-3 Ltd. (“Triangle Re 2021-3”) on a portfolio of existing mortgage insurance policies written from January 2021 through June 2021. In connection with entering into the reinsurance agreement with Triangle Re 2021-3, we believe that the risk transfer requirements for reinsurance accounting were met as Triangle Re 2021-3 is assuming significant insurance risk and a reasonable possibility of significant loss. At closing, we retain the first layer of aggregate losses up to $303.5 million. Triangle Re 2021-3 provides 72% reinsurance coverage for losses above our retained layer up to $371.5 million. On April 16, 2021, we obtained $302.7 million of excess of loss reinsurance coverage from Triangle Re 2021-2 Ltd. (“Triangle Re 2021-2”) on a portfolio of existing mortgage insurance policies written from September 2020 through December 2020. In connection with entering into the reinsurance agreement with Triangle Re 2021-2, we believe that the risk transfer requirements for reinsurance accounting were met as Triangle Re 2021-2 is assuming significant insurance risk and a reasonable possibility of significant loss. For the reinsurance coverage, we retain the first layer of aggregate losses up to $188.6 million. Triangle Re 2021-2 provides 76% reinsurance coverage for losses above our retained first layer up to $302.7 million. On March 2, 2021, we obtained $495.0 million of excess of loss reinsurance coverage from Triangle Re 2021-1 Ltd. (“Triangle Re 2021-1”) on a portfolio of existing seasoned mortgage insurance policies written from January 2014 through December 2018 and from October 2019 through December 2019. In connection with entering into the reinsurance agreement with Triangle Re 2021-1, we believe that the risk transfer requirements for reinsurance accounting were met as Triangle Re 2021-1 is assuming significant insurance risk and a reasonable possibility of significant loss. Triangle Re 2021-1 reinsurance coverage is derived by applying a reinsurance cession percentage to the mortgage insurance coverage for each loan to get to an Aggregate Exposed Principal Balance (“AEPB”). This AEPB accounts for any existing reinsurance and ensures we retain a minimum 5% vertical risk retention on each loan. For the reinsurance coverage, we retain the first layer of aggregate losses up to $212.1 million. Triangle Re 2021-1 provides 100% reinsurance coverage for losses above our retained first layer up to $495.0 million. Other excess of loss reinsurance treaties On September 15, 2022, we executed an excess of loss reinsurance transaction with a panel of reinsurers, which provides up to $201 million of reinsurance coverage on a portfolio of existing mortgage insurance policies written from January 1, 2022 through June 30, 2022, effective September 1, 2022. On March 24, 2022, we executed an excess of loss reinsurance transaction with a panel of reinsurers, which provides up to $325 million of reinsurance coverage on a portfolio of existing mortgage insurance policies written from July 1, 2021 through December 31, 2021, effective March 1, 2022. On January 27, 2022, we executed an excess of loss reinsurance transaction with a panel of reinsurers, which provides up to $294 million of reinsurance coverage on a portion of current and expected new insurance written for the 2022 book year, effective January 1, 2022. On February 4, 2021, we executed an excess of loss reinsurance transaction with a panel of reinsurers, which provides up to $206 million of reinsurance coverage on a portion of current and expected new insurance written (“NIW”) for the 2021 book year, effective January 1, 2021. |
Borrowings
Borrowings | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Borrowings | Borrowings In 2020, we issued $750 million aggregate principal amount of 6.5% senior notes due in 2025 (the “2025 Senior Notes”). Interest on the 2025 Senior Notes is payable semi-annually in arrears on February 15 and August 15 of each year. The 2025 Senior Notes mature on August 15, 2025. The following table sets forth long-term borrowings as of the dates indicated: (Amounts in thousands) September 30, December 31, 6.5% Senior Notes, due 2025 $ 750,000 $ 750,000 Deferred borrowing charges (7,789) (9,584) Total $ 742,211 $ 740,416 Revolving Credit Agreement On June 30, 2022, we entered into a credit agreement with a syndicate of lenders that provides for a five-year, unsecured revolving credit facility (the “Facility”) in the initial aggregate principal amount of $200 million, including the ability for EHI to increase the commitments under the Facility, on an uncommitted basis, by an additional aggregate principal amount of up to $100 million. Borrowings under the Facility will accrue interest at a floating rate tied to a standard short-term borrowing index, selected at EHI’s option, plus an applicable margin. The applicable margin is based on the ratings established by certain debt rating agencies for EHI’s senior unsecured debt. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We compute the provision for income taxes on a separate return with benefits-for-loss method. If during the three- and nine-month periods ended September 30, 2022 and 2021, we had computed taxes using the separate return method, the provision for income taxes would have been unchanged. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions We have various agreements with Genworth that provide for reimbursement to and from Genworth of certain administrative and operating expenses that include, but are not limited to, information technology services and administrative services (such as finance, human resources, employee benefit administration and legal). These agreements provide for an allocation of corporate expenses to all Genworth businesses or subsidiaries. We incurred costs for these services of $7.5 million and $8.1 million for the three months ended September 30, 2022 and 2021, respectively. We incurred costs for these services of $22.9 million and $37.2 million for the nine months ended September 30, 2022 and 2021, respectively. The investment portfolios of our insurance subsidiaries are managed by Genworth. Under the terms of the investment management agreement, we are charged a fee by Genworth. All fees paid to Genworth are charged to investment expense and are included in net investment income in the condensed consolidated statements of income. The total investment expenses paid to Genworth were $1.4 million and $1.3 million for the three months ended September 30, 2022 and 2021, respectively. The total investment expenses paid to Genworth were $4.2 million and $4.2 million for the nine months ended September 30, 2022 and 2021, respectively. Our employees participate in certain benefit plans sponsored by Genworth and certain share-based compensation plans that utilize shares of Genworth common stock and other incentive plans. We provide certain information technology and administrative services (such as facilities and maintenance) to Genworth. We charged Genworth $0.2 million and $0.1 million for these services for the three months ended September 30, 2022 and 2021, respectively. We charged Genworth $0.6 million and $0.2 million for these services for the nine months ended September 30, 2022 and 2021, respectively. We have a tax sharing agreement in place with Genworth, such that we participate in a single U.S. consolidated income tax return filing. All intercompany balances related to this agreement are settled at least annually. The condensed consolidated financial statements include the following amounts due to and from Genworth relating to recurring service and expense agreements as of: (Amounts in thousands) September 30, 2022 December 31, 2021 Amounts payable to Genworth $ 12,082 $ 8,316 Amounts receivable from Genworth $ 14 $ 133 |
Net Income Per Common Share
Net Income Per Common Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | Net Income Per Common Share The basic earnings per share computation is based on the weighted average number of shares of common stock outstanding. For the three and nine months ended September 30, 2022 and 2021, the calculation of dilutive weighted average shares considers the impact of restricted stock units and performance stock units issued to employees as well deferred stock units issued to our directors. The calculation of basic and diluted net income per share is as follows: Three months ended Nine months ended (Amounts in thousands, except per share amounts) 2022 2021 2022 2021 Net income available to EHI common stockholders $ 190,986 $ 137,208 $ 560,351 $ 393,151 Net income per common share: Basic $ 1.17 $ 0.84 $ 3.44 $ 2.41 Diluted $ 1.17 $ 0.84 $ 3.43 $ 2.41 Weighted average common shares outstanding: Basic 162,843 162,840 162,842 162,840 Diluted 163,376 162,852 163,219 162,844 |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Income | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Changes in Accumulated Other Comprehensive Income | Changes in Accumulated Other Comprehensive Income The following tables present a roll forward of accumulated other comprehensive income for the three months indicated: (Amounts in thousands) Net unrealized investment gains (losses) Foreign currency translation Total Balance as of July 1, 2022, net of tax $ (293,113) $ 86 $ (293,027) Other comprehensive income (loss) before reclassifications (134,135) 44 (134,091) Amounts reclassified from other comprehensive income (loss) 33 — 33 Total other comprehensive income (loss) (134,102) 44 (134,058) Balance as of September 30, 2022, net of tax $ (427,215) $ 130 $ (427,085) (Amounts in thousands) Net unrealized Foreign currency translation Total Balance as of July 1, 2021, net of tax $ 159,854 $ — $ 159,854 Other comprehensive income (loss) before reclassifications (25,337) — (25,337) Amounts reclassified from other comprehensive income (loss) (562) — (562) Total other comprehensive income (loss) (25,899) — (25,899) Balance as of September 30, 2021, net of tax $ 133,955 $ — $ 133,955 The following tables present a roll forward of accumulated other comprehensive income for the nine months indicated: (Amounts in thousands) Net unrealized investment gains (losses) Foreign currency translation Total Balance as of January 1, 2022, net of tax $ 83,588 $ (7) $ 83,581 Other comprehensive income (loss) before reclassifications (511,541) 137 (511,404) Amounts reclassified from other comprehensive income (loss) 738 — 738 Total other comprehensive income (loss) (510,803) 137 (510,666) Balance as of September 30, 2022, net of tax $ (427,215) $ 130 $ (427,085) (Amounts in thousands) Net unrealized Foreign currency translation Total Balance as of January 1, 2021, net of tax $ 208,378 $ — $ 208,378 Cumulative effective of change in accounting, net of taxes 281 — 281 Other comprehensive income (loss) before reclassifications (74,576) — (74,576) Amounts reclassified from other comprehensive income (loss) (128) — (128) Total other comprehensive income (loss) (74,704) — (74,704) Balance as of September 30, 2021, net of tax $ 133,955 $ — $ 133,955 The following table presents the effect of the reclassifications of significant items out of accumulated other comprehensive income on the respective line items of the consolidated statements of income, for the periods indicated: Amount reclassified from accumulated other comprehensive income Affected line item in the condensed consolidated statements of income Three months ended September 30, Nine months ended September 30, (Amounts in thousands) 2022 2021 2022 2021 Net unrealized gains (losses) on investments $ (42) $ 711 $ (935) $ 162 Net investment gains (losses) Benefit (expense) from income taxes 9 (149) 197 (34) Provision for income taxes |
Accounting Policies (Policies)
Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Accounting Pronouncements Recently Adopted | Accounting Pronouncements Recently Adopted We have not adopted new accounting pronouncements in 2022. Accounting Pronouncements Not Yet Adopted There are no significant new accounting pronouncements impacting our financial statements. |
Recurring Fair Value Measurements | We hold fixed maturity securities and short-term investments, which are carried at fair value. The fair value of fixed maturity securities and short-term investments are estimated primarily based on information derived from third-party pricing services (“pricing services”), internal models and/or broker quotes, which use a market approach, income approach or a combination of the market and income approach depending on the type of instrument and availability of information. In general, a market approach is utilized if there is readily available and relevant market activity for an individual security. In certain cases where market information is not available for a specific security but is available for similar securities, that security is valued using market information for similar securities, which is also a market approach. When market information is not available for a specific security (or similar securities) or is available but such information is less relevant or reliable, an income approach or a combination of a market and income approach is utilized. For securities with optionality, such as call or prepayment features (including asset-backed securities), an income or combination approach may be used. These valuation techniques may change from period to period, based on the relevance and availability of market data. Further, while we consider the valuations provided by pricing services and broker quotes to be of high quality, management determines the fair value of our investment securities after considering all relevant and available information. In general, we first obtain valuations from pricing services. If prices are unavailable for public securities, we obtain broker quotes. For all securities, excluding certain private fixed maturity securities, if neither a pricing service nor broker quotes valuation is available, we determine fair value using internal models. For certain private fixed maturity securities where we do not obtain valuations from pricing services, we utilize an internal model to determine fair value since transactions for similar securities are not readily observable and these securities are not typically valued by pricing services. Given our understanding of the pricing methodologies and procedures of pricing services, the securities valued by pricing services are typically classified as Level 2 unless we determine the valuation process for a security or group of securities utilizes significant unobservable inputs, which would result in the valuation being classified as Level 3. Broker quotes are typically based on an income approach given the lack of available market data. As the valuation typically includes significant unobservable inputs, we classify the securities where fair value is based on our consideration of broker quotes as Level 3 measurements. For private fixed maturity securities, we utilize an income approach where we obtain public bond spreads and utilize those in an internal model to determine fair value. Other inputs to the model include rating and weighted-average life, as well as sector which is used to assign the spread. We then add an additional premium, which represents an unobservable input, to the public bond spread to adjust for the liquidity and other features of our private placements. We utilize the estimated market yield to discount the expected cash flows of the security to determine fair value. We utilize price caps for securities where the estimated market yield results in a valuation that may exceed the amount that would be received in a market transaction. When a security does not have an external rating, we assign the security an internal rating to determine the appropriate public bond spread that should be utilized in the valuation. While we generally consider the public bond spreads by sector and maturity to be observable inputs, we evaluate the similarities of our private placement with the public bonds, any price caps utilized, liquidity premiums applied, and whether external ratings are available for our private placements to determine whether the spreads utilized would be considered observable inputs. We classify private securities without an external rating or public bond spread as Level 3. In general, a significant increase (decrease) in credit spreads would have resulted in a significant decrease (increase) in the fair value for our fixed maturity securities as of September 30, 2022. For remaining securities priced using internal models, we determine fair value using an income approach. We maximize the use of observable inputs but typically utilize significant unobservable inputs to determine fair value. Accordingly, the valuations are typically classified as Level 3. |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary Investment Income | Sources of net investment income were as follows for the periods indicated: Three months ended Nine months ended (Amounts in thousands) 2022 2021 2022 2021 Fixed maturity securities available-for-sale $ 38,450 $ 37,055 $ 111,794 $ 110,007 Cash, cash equivalents and short-term investments 2,423 13 2,854 65 Gross investment income before expenses and fees 40,873 37,068 114,648 110,072 Investment expenses and fees (1,380) (1,073) (4,233) (4,129) Net investment income $ 39,493 $ 35,995 $ 110,415 $ 105,943 |
Summary of Net Investment Gains (Losses) | The following table sets forth net investment gains (losses) for the periods indicated: Three months ended Nine months ended (Amounts in thousands) 2022 2021 2022 2021 Fixed maturity securities available-for-sale: Gross realized gains $ 573 $ 839 $ 1,214 $ 1,423 Gross realized (losses) (615) (128) (2,149) (1,261) Net realized gains (losses) (42) 711 (935) 162 Net change in allowance for credit losses on fixed maturity securities available-for-sale — (131) 173 (2,291) Net investment gains (losses) $ (42) $ 580 $ (762) $ (2,129) |
Schedule of Allowance for Credit Losses by Security Type | There was no recorded allowance for credit losses for fixed maturity securities available-for-sale as of and for the three and nine months ended September 30, 2022. There was no recorded allowance for credit losses for fixed maturity securities available-for-sale as of and for the three months ended September 30, 2021. The following table represents the allowance for credit losses aggregated by security type for fixed maturity available-for-sale securities as of and for the nine months ended September 30, 2021: (Amounts in thousands) Beginning balance Cumulative effect of change in accounting Increase from securities without allowance in previous periods Securities sold Ending balance Fixed maturity securities: Non-U.S. corporate $ — $ 357 $ 2,157 $ (2,514) $ — Total fixed maturity securities available-for-sale $ — $ 357 $ 2,157 $ (2,514) $ — |
Schedule of Unrealized Gain (Loss) on Investments | Net unrealized gains and losses on available-for-sale securities reflected as a separate component of accumulated other comprehensive income (“AOCI”) were as follows as of the dates indicated: (Amounts in thousands) September 30, 2022 December 31, 2021 Net unrealized gains (losses) on investment securities: Fixed maturity securities $ (542,631) $ 106,165 Short-term investments (19) — Unrealized gains (losses) on investment securities (542,650) 106,165 Income taxes 115,435 (22,577) Net unrealized investment gains (losses) $ (427,215) $ 83,588 The change in net unrealized gains (losses) on available-for-sale securities reported in accumulated other comprehensive income was as follows as of and for the periods indicated: Three months ended (Amounts in thousands) 2022 2021 Beginning balance $ (293,113) $ 159,854 Unrealized gains (losses) arising during the period: Unrealized gains (losses) on investment securities (170,400) (32,185) Provision for income taxes 36,265 6,848 Change in unrealized gains (losses) on investment securities (134,135) (25,337) Reclassification adjustments to net investment (gains) losses, net of taxes of $(9) and $149, respectively 33 (562) Change in net unrealized investment gains (losses) (134,102) (25,899) Ending balance $ (427,215) $ 133,955 Nine months ended (Amounts in thousands) 2022 2021 Beginning balance $ 83,588 $ 208,378 Cumulative effect of change in accounting, net of taxes — 281 Unrealized gains (losses) arising during the period: Unrealized gains (losses) on investment securities (649,750) (94,724) Provision for income taxes 138,209 20,148 Change in unrealized gains (losses) on investment securities (511,541) (74,576) Reclassification adjustments to net investment (gains) losses, net of taxes of $(197) and $34, respectively 738 (128) Change in net unrealized investment gains (losses) (510,803) (74,704) Ending balance $ (427,215) $ 133,955 |
Summary of Fixed Maturity Securities Classified as Available-for-Sale | As of September 30, 2022, the amortized cost, gross unrealized gains (losses) and fair value of our investment securities were as follows: (Amounts in thousands) Amortized cost Gross unrealized gains Gross unrealized losses Fair value U.S. government, agencies and GSEs $ 46,322 $ 66 $ (1,734) $ 44,654 State and political subdivisions 528,255 2,429 (98,455) 432,229 Non-U.S. government 10,643 — (1,391) 9,252 U.S. corporate 2,918,599 275 (279,690) 2,639,184 Non-U.S. corporate 721,819 17 (74,773) 647,063 Residential mortgage-backed 11,941 — (198) 11,743 Other asset-backed 1,182,954 14 (89,191) 1,093,777 Total fixed maturity securities available-for-sale $ 5,420,533 $ 2,801 $ (545,432) $ 4,877,902 Short-term investments 2,453 — (19) 2,434 Total investments available-for-sale $ 5,422,986 $ 2,801 $ (545,451) $ 4,880,336 As of December 31, 2021, the amortized cost, gross unrealized gains (losses) and fair value of our investment securities were as follows: (Amounts in thousands) Amortized cost Gross unrealized gains Gross unrealized losses Fair value U.S. government, agencies and GSEs $ 56,547 $ 1,863 $ (2) $ 58,408 State and political subdivisions 531,927 10,982 (4,456) 538,453 Non-U.S. government 22,358 248 (190) 22,416 U.S. corporate 2,863,100 98,293 (16,090) 2,945,303 Non-U.S. corporate 652,503 17,556 (3,465) 666,594 Other asset-backed 1,033,739 6,989 (5,563) 1,035,165 Total fixed maturity securities available-for-sale $ 5,160,174 $ 135,931 $ (29,766) $ 5,266,339 |
Schedule of Unrealized Losses and FV of Fixed Maturity Securities Available for Sale | The following table presents the gross unrealized losses and fair values of our fixed maturity securities for which an allowance for credit losses has not been recorded, aggregated by investment type and length of time that individual fixed maturity securities have been in a continuous unrealized loss position, as of September 30, 2022: Less than 12 months 12 months or more Total (Amounts in thousands) Fair value Gross unrealized losses Number of securities Fair value Gross unrealized losses Number of securities Fair value Gross unrealized losses Number of securities Fixed maturity securities: U.S. government, agencies and GSEs $ 43,752 $ (1,724) 18 $ 95 $ (10) 1 $ 43,847 $ (1,734) 19 State and political subdivisions 315,865 (74,515) 63 84,279 (23,940) 26 400,144 (98,455) 89 Non-U.S. government — — — 9,252 (1,391) 1 9,252 (1,391) 1 U.S. corporate 2,289,613 (199,380) 522 347,057 (80,310) 56 2,636,670 (279,690) 578 Non-U.S. corporate 540,135 (52,646) 136 101,487 (22,127) 18 641,622 (74,773) 154 Residential mortgage-backed 11,743 (198) 6 — — — 11,743 (198) 6 Other asset-backed 906,744 (66,738) 261 162,110 (22,453) 33 1,068,854 (89,191) 294 Total for fixed maturity securities in an unrealized loss position $ 4,107,852 $ (395,201) 1,006 $ 704,280 $ (150,231) 135 $ 4,812,132 $ (545,432) 1,141 The following table presents the gross unrealized losses and fair values of our fixed maturity securities, aggregated by investment type and length of time that individual fixed maturity securities have been in a continuous unrealized loss position, as of December 31, 2021: Less than 12 months 12 months or more Total (Amounts in thousands) Fair value Gross unrealized losses Number of securities Fair value Gross unrealized losses Number of securities Fair value Gross unrealized losses Number of securities Fixed maturity securities: U.S. government, agencies and GSEs $ 103 $ (2) 1 $ — $ — — $ 103 $ (2) 1 State and political subdivisions 255,202 (4,456) 47 — — — 255,202 (4,456) 47 Non-U.S. government 10,560 (190) 1 — — — 10,560 (190) 1 U.S. corporate 649,927 (14,300) 94 26,181 (1,790) 4 676,108 (16,090) 98 Non-U.S. corporate 183,485 (3,465) 28 — — — 183,485 (3,465) 28 Other asset-backed 456,565 (5,549) 76 3,736 (14) 1 460,301 (5,563) 77 Total for fixed maturity securities in an unrealized loss position $ 1,555,842 $ (27,962) 247 $ 29,917 $ (1,804) 5 $ 1,585,759 $ (29,766) 252 The scheduled maturity distribution of fixed maturity securities as of September 30, 2022, is set forth below. Actual maturities may differ from contractual maturities because issuers of securities may have the right to call or prepay obligations with or without call or prepayment penalties. (Amounts in thousands) Amortized cost Fair value Due one year or less $ 214,145 $ 212,697 Due after one year through five years 2,154,780 2,013,369 Due after five years through ten years 1,569,701 1,314,043 Due after ten years 287,012 232,273 Subtotal 4,225,638 3,772,382 Residential mortgage-backed 11,941 11,743 Other asset-backed 1,182,954 1,093,777 Total fixed maturity securities available-for-sale $ 5,420,533 $ 4,877,902 |
Fair Value (Tables)
Fair Value (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Summary of Significant Inputs used for Fair Value Measurement of Fixed Maturity Securities | The following table presents a summary of the significant inputs used by our pricing services for certain fair value measurements of fixed maturity securities that are classified as Level 2 as of September 30, 2022: (Amounts in thousands) Fair value Primary methodologies Significant inputs U.S. government, agencies and GSEs $ 44,654 Price quotes from trading desk, broker feeds Bid side prices, trade prices, Option Adjusted Spread (“OAS”) to swap curve, Bond Market Association OAS, Treasury Curve, Agency Bullet Curve, maturity to issuer spread State and political subdivisions $ 432,229 Multi-dimensional attribute-based modeling systems, third-party pricing vendors Trade prices, material event notices, Municipal Market Data benchmark yields, broker quotes Non-U.S. government $ 9,252 Matrix pricing, spread priced to benchmark curves, price quotes from market makers Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources U.S. corporate $ 2,256,976 Multi-dimensional attribute-based modeling systems, broker quotes, price quotes from market makers, internal models, OAS-based models Bid side prices to Treasury Curve, Issuer Curve, which includes sector, quality, duration, OAS percentage and change for spread matrix, trade prices, comparative transactions, Trade Reporting and Compliance Engine (“TRACE”) reports Non-U.S. corporate $ 476,784 Multi-dimensional attribute-based modeling systems, OAS-based models, price quotes from market makers Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources Residential mortgage-backed $ 11,743 OAS-based models, single factor binomial models, internally priced Prepayment and default assumptions, aggregation of bonds with similar characteristics, including collateral type, vintage, tranche type, weighted-average life, weighted-average loan age, issuer program and delinquency ratio, pay up and pay down factors, TRACE reports Other asset-backed $ 1,086,134 Multi-dimensional attribute-based modeling systems, spread matrix priced to swap curves, price quotes from market makers Spreads to daily updated swap curves, spreads derived from trade prices and broker quotes, bid side prices, new issue data, collateral performance, analysis of prepayment speeds, cash flows, collateral loss analytics, historical issue analysis, trade data from market makers, TRACE reports |
Schedule of Fair Value Assets Measured on Recurring Basis | The following tables set forth our assets by class of instrument that are measured at fair value on a recurring basis as of the dates indicated: September 30, 2022 (Amounts in thousands) Total Level 1 Level 2 Level 3 Fixed maturity securities: U.S. government, agencies and GSEs $ 44,654 $ — $ 44,654 $ — State and political subdivisions 432,229 — 432,229 — Non-U.S. government 9,252 — 9,252 — U.S. corporate 2,639,184 — 2,422,247 216,937 Non-U.S. corporate 647,063 — 568,447 78,616 Residential mortgage-backed 11,743 — 11,743 — Other asset-backed 1,093,777 — 1,086,134 7,643 Total fixed maturity securities 4,877,902 — 4,574,706 303,196 Short-term investments 2,434 — 2,434 — Total $ 4,880,336 $ — $ 4,577,140 $ 303,196 December 31, 2021 (Amounts in thousands) Total Level 1 Level 2 Level 3 Fixed maturity securities: U.S. government, agencies and GSEs $ 58,408 $ — $ 58,408 $ — State and political subdivisions 538,453 — 538,453 — Non-U.S. government 22,416 — 22,416 — U.S. corporate 2,945,303 — 2,724,570 220,733 Non-U.S. corporate 666,594 — 582,930 83,664 Other asset-backed 1,035,165 — 1,010,942 24,223 Total $ 5,266,339 $ — $ 4,937,719 $ 328,620 |
Schedule of Fair Value Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The following tables present additional information about assets measured at fair value on a recurring basis and for which we have utilized significant unobservable (Level 3) inputs to determine fair value as of or for the dates indicated: Beginning Total realized and unrealized gains (losses) Purchases Settlements Transfer into Level 3 (1) Transfer out of Level 3 (1) Ending Total gains (losses) attributable to assets still held (Amounts in thousands) Included in net income Included in OCI Included in net income Included in OCI Fixed maturity securities: U.S. corporate $ 216,654 $ (14) $ (9,292) $ 9,999 $ (410) $ — $ — $ 216,937 $ (14) $ (9,293) Non-U.S. corporate 83,305 (86) (2,498) 8,000 (10,105) — — 78,616 (86) (2,501) Other asset-backed 15,054 — (523) 7,823 — — (14,711) 7,643 — (180) Total $ 315,013 $ (100) $ (12,313) $ 25,822 $ (10,515) $ — $ (14,711) $ 303,196 $ (100) $ (11,974) Beginning Total realized and unrealized gains (losses) Purchases Settlements Transfer into Level 3 (1) Transfer out of Level 3 (1) Ending Total gains (losses) attributable to assets still held (Amounts in thousands) Included in net income Included in OCI Included in net income Included in OCI Fixed maturity securities: U.S. corporate $ 129,613 $ (30) $ (2,778) $ 53,000 $ (3,426) $ 4,318 $ (3,010) $ 177,687 $ (30) $ (2,769) Non-U.S. corporate 91,157 958 (644) 6,000 (14,148) 3,010 — 86,333 (83) 235 Other asset-backed 10,015 — (170) 10,000 (1,459) — — 18,386 — (146) Total $ 230,785 $ 928 $ (3,592) $ 69,000 $ (19,033) $ 7,328 $ (3,010) $ 282,406 $ (113) $ (2,680) ______________ (1) The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads. Beginning Total realized and unrealized gains (losses) Purchases Settlements Transfer into Level 3 (1) Transfer out of Level 3 (1) Ending Total gains (losses) attributable to assets still held (Amounts in thousands) Included in net income Included in OCI Included in net income Included in OCI Fixed maturity securities: U.S. corporate $ 220,733 $ (42) $ (39,462) $ 49,968 $ (850) $ — $ (13,410) $ 216,937 $ (42) $ (38,970) Non-U.S. corporate 83,664 (254) (11,768) 21,009 (10,316) — (3,719) 78,616 (254) (11,476) Other asset-backed 24,223 — (2,090) 22,820 — — (37,310) 7,643 — (123) Total $ 328,620 $ (296) $ (53,320) $ 93,797 $ (11,166) $ — $ (54,439) $ 303,196 $ (296) $ (50,569) (Amounts in thousands) Beginning Total realized and Purchases Settlements Transfer into Level 3 (1) Transfer out of Level 3 (1) Ending Total gains Included Included Included in net income Included in OCI Fixed maturity securities: U.S. corporate $ 119,373 $ (92) $ (3,750) $ 71,000 $ (8,914) $ 7,397 $ (7,327) $ 177,687 $ (92) $ (4,029) Non-U.S. corporate 95,751 868 3,147 42,786 (25,044) 3,010 (34,185) 86,333 (168) (683) Other asset-backed 13,781 — (104) 10,000 (2,723) — (2,568) 18,386 — (130) Total $ 228,905 $ 776 $ (707) $ 123,786 $ (36,681) $ 10,407 $ (44,080) $ 282,406 $ (260) $ (4,842) ______________ (1) The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads. The following table presents a summary of the significant unobservable inputs used for certain asset fair value measurements that are based on internal models and classified as Level 3 as of September 30, 2022: (Amounts in thousands) Valuation technique Fair value (1) Unobservable input Range (bps) Weighted- average (2) (bps) Fixed maturity securities: U.S. corporate Internal models $ 213,731 Credit spreads 50 - 230 153 Non-U.S. corporate Internal models $ 78,614 Credit spreads 91 - 242 159 ______________ (1) Certain classes of instruments classified as Level 3 are excluded as a result of not being material or due to limitations in being able to obtain the underlying inputs used by certain third-party sources, such as broker quotes, used as an input in determining fair value. |
Schedule of Estimated Fair Value Liabilities | The following represents our estimated fair value of financial liabilities that are not required to be carried at fair value, classified as Level 2, as of the dates indicated: September 30, 2022 December 31, 2021 (Amounts in thousands) Carrying amount Fair value Carrying amount Fair value Long-term borrowings $ 742,211 $ 719,213 $ 740,416 $ 821,033 |
Loss Reserves (Tables)
Loss Reserves (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Insurance [Abstract] | |
Schedule of Liability for Loss Reserves | Activity for the liability for loss reserves for the nine months ended September 30, is summarized as follows: (Amounts in thousands) 2022 2021 Loss reserves, beginning balance $ 641,325 $ 555,679 Run-off reserves (681) (654) Net loss reserves, beginning balance 640,644 555,025 Losses and LAE incurred related to current accident year 138,504 104,939 Losses and LAE incurred related to prior accident years (250,799) 14,468 Total incurred (1) (112,295) 119,407 Losses and LAE paid related to current accident year (1,005) (1,574) Losses and LAE paid related to prior accident years (17,772) (25,194) Total paid (1) (18,777) (26,768) Net loss reserves, ending balance 509,572 647,664 Run-off reserves 665 701 Loss reserves, ending balance $ 510,237 $ 648,365 ______________ (1) Losses and loss adjustment expenses (“LAE”) incurred and paid exclude losses related to our run-off business. |
Reinsurance (Tables)
Reinsurance (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | |
Effects of Reinsurance | The following table sets forth the effects of reinsurance on premiums written and earned for the periods indicated: Three months ended Nine months ended (Amounts in thousands) 2022 2021 2022 2021 Net premiums written: Direct $ 243,655 $ 252,719 $ 732,079 $ 738,848 Assumed 64 78 198 249 Ceded (20,453) (18,500) (58,884) (53,150) Net premiums written $ 223,266 $ 234,297 $ 673,393 $ 685,947 Net premiums earned: Direct $ 255,449 $ 261,485 $ 765,411 $ 790,986 Assumed 64 78 198 249 Ceded (20,453) (18,500) (58,884) (53,150) Net premiums earned $ 235,060 $ 243,063 $ 706,725 $ 738,085 |
Borrowings (Tables)
Borrowings (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Borrowings | The following table sets forth long-term borrowings as of the dates indicated: (Amounts in thousands) September 30, December 31, 6.5% Senior Notes, due 2025 $ 750,000 $ 750,000 Deferred borrowing charges (7,789) (9,584) Total $ 742,211 $ 740,416 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions [Table Text Block] | The condensed consolidated financial statements include the following amounts due to and from Genworth relating to recurring service and expense agreements as of: (Amounts in thousands) September 30, 2022 December 31, 2021 Amounts payable to Genworth $ 12,082 $ 8,316 Amounts receivable from Genworth $ 14 $ 133 |
Net Income Per Common Share (Ta
Net Income Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Income Per Share | The calculation of basic and diluted net income per share is as follows: Three months ended Nine months ended (Amounts in thousands, except per share amounts) 2022 2021 2022 2021 Net income available to EHI common stockholders $ 190,986 $ 137,208 $ 560,351 $ 393,151 Net income per common share: Basic $ 1.17 $ 0.84 $ 3.44 $ 2.41 Diluted $ 1.17 $ 0.84 $ 3.43 $ 2.41 Weighted average common shares outstanding: Basic 162,843 162,840 162,842 162,840 Diluted 163,376 162,852 163,219 162,844 |
Changes in Accumulated Other _2
Changes in Accumulated Other Comprehensive Income (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | (Amounts in thousands) Net unrealized investment gains (losses) Foreign currency translation Total Balance as of July 1, 2022, net of tax $ (293,113) $ 86 $ (293,027) Other comprehensive income (loss) before reclassifications (134,135) 44 (134,091) Amounts reclassified from other comprehensive income (loss) 33 — 33 Total other comprehensive income (loss) (134,102) 44 (134,058) Balance as of September 30, 2022, net of tax $ (427,215) $ 130 $ (427,085) (Amounts in thousands) Net unrealized Foreign currency translation Total Balance as of July 1, 2021, net of tax $ 159,854 $ — $ 159,854 Other comprehensive income (loss) before reclassifications (25,337) — (25,337) Amounts reclassified from other comprehensive income (loss) (562) — (562) Total other comprehensive income (loss) (25,899) — (25,899) Balance as of September 30, 2021, net of tax $ 133,955 $ — $ 133,955 (Amounts in thousands) Net unrealized investment gains (losses) Foreign currency translation Total Balance as of January 1, 2022, net of tax $ 83,588 $ (7) $ 83,581 Other comprehensive income (loss) before reclassifications (511,541) 137 (511,404) Amounts reclassified from other comprehensive income (loss) 738 — 738 Total other comprehensive income (loss) (510,803) 137 (510,666) Balance as of September 30, 2022, net of tax $ (427,215) $ 130 $ (427,085) (Amounts in thousands) Net unrealized Foreign currency translation Total Balance as of January 1, 2021, net of tax $ 208,378 $ — $ 208,378 Cumulative effective of change in accounting, net of taxes 281 — 281 Other comprehensive income (loss) before reclassifications (74,576) — (74,576) Amounts reclassified from other comprehensive income (loss) (128) — (128) Total other comprehensive income (loss) (74,704) — (74,704) Balance as of September 30, 2021, net of tax $ 133,955 $ — $ 133,955 |
Reclassification out of Accumulated Other Comprehensive Income | The following table presents the effect of the reclassifications of significant items out of accumulated other comprehensive income on the respective line items of the consolidated statements of income, for the periods indicated: Amount reclassified from accumulated other comprehensive income Affected line item in the condensed consolidated statements of income Three months ended September 30, Nine months ended September 30, (Amounts in thousands) 2022 2021 2022 2021 Net unrealized gains (losses) on investments $ (42) $ 711 $ (935) $ 162 Net investment gains (losses) Benefit (expense) from income taxes 9 (149) 197 (34) Provision for income taxes |
Nature of Business, Organizat_2
Nature of Business, Organization Structure and Basis of Presentation (Details) $ / shares in Units, $ in Millions | Sep. 20, 2021 USD ($) | Sep. 16, 2021 shares | Sep. 15, 2021 $ / shares shares | Sep. 30, 2022 state $ / shares shares | Dec. 31, 2021 $ / shares shares | May 03, 2021 $ / shares shares |
Subsidiary, Sale of Stock [Line Items] | ||||||
Common stock, authorized (in shares) | 600,000,000 | 600,000,000 | 600,000,000 | |||
Common stock, par value (in usd per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||
Common stock, issued (in shares) | 162,843,000 | 162,843,000 | 162,840,000 | |||
Underwriters option period | 30 days | |||||
Number of states in which entity operates | state | 50 | |||||
The Offering | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Gross proceeds on stock offering | $ | $ 553 | |||||
Stock issuance costs | $ | $ 24 | |||||
IPO | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Shares issued in transaction (in shares) | 13,310,400 | |||||
Price per share (in USD per share) | $ / shares | $ 19 | |||||
Private Sale | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Shares issued in transaction (in shares) | 14,655,600 | |||||
Price per share (in USD per share) | $ / shares | $ 17.86 | |||||
Over-Allotment Option | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Shares issued in transaction (in shares) | 1,996,560 | 1,996,560 | ||||
Genworth Holdings, Inc. | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Investment owned (in shares) | 100 |
Investments - Net Investment In
Investments - Net Investment Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Net Investment Income [Line Items] | ||||
Gross investment income before expenses and fees | $ 40,873 | $ 37,068 | $ 114,648 | $ 110,072 |
Investment expenses and fees | (1,380) | (1,073) | (4,233) | (4,129) |
Net investment income | 39,493 | 35,995 | 110,415 | 105,943 |
Fixed maturity securities available-for-sale | ||||
Net Investment Income [Line Items] | ||||
Gross investment income before expenses and fees | 38,450 | 37,055 | 111,794 | 110,007 |
Cash, cash equivalents and short-term investments | ||||
Net Investment Income [Line Items] | ||||
Gross investment income before expenses and fees | $ 2,423 | $ 13 | $ 2,854 | $ 65 |
Investments - Net Investment Ga
Investments - Net Investment Gains (Losses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Fixed maturity securities available-for-sale: | ||||
Gross realized gains | $ 573 | $ 839 | $ 1,214 | $ 1,423 |
Gross realized (losses) | (615) | (128) | (2,149) | (1,261) |
Net realized gains (losses) | (42) | 711 | (935) | 162 |
Net change in allowance for credit losses on fixed maturity securities available-for-sale | 0 | (131) | 173 | (2,291) |
Net investment gains (losses) | $ (42) | $ 580 | $ (762) | $ (2,129) |
Investments - Schedule of Allow
Investments - Schedule of Allowance for Credit Losses (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2021 USD ($) | |
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |
Beginning balance | $ 0 |
Cumulative effect of change in accounting | 357 |
Increase from securities without allowance in previous periods | 2,157 |
Securities sold | (2,514) |
Ending balance | 0 |
Non-U.S. corporate | |
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |
Beginning balance | 0 |
Cumulative effect of change in accounting | 357 |
Increase from securities without allowance in previous periods | 2,157 |
Securities sold | (2,514) |
Ending balance | $ 0 |
Investments - Net Unrealized Ga
Investments - Net Unrealized Gains and Losses on Available-for-Sale Securities as a Separate Component of OCI (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Net Investment Income [Line Items] | ||
Fixed maturity securities | $ (542,650) | $ 106,165 |
Income taxes | (115,435) | 22,577 |
Net unrealized investment gains (losses) | (427,215) | 83,588 |
Fixed maturity securities available-for-sale | ||
Net Investment Income [Line Items] | ||
Fixed maturity securities | (542,631) | 106,165 |
Short-term investments | ||
Net Investment Income [Line Items] | ||
Fixed maturity securities | $ (19) | $ 0 |
Investments - Change in Net Unr
Investments - Change in Net Unrealized Gains (Losses) on Available-for-Sale Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Roll Forward] | ||||
Beginning balance | $ 4,080,500 | $ 4,089,851 | $ 4,105,523 | $ 3,881,811 |
Reclassification adjustments to net investment (gains) losses, tax | (9) | 149 | (197) | 34 |
Ending balance | 4,116,992 | 4,201,381 | 4,116,992 | 4,201,381 |
Net unrealized investment gains (losses) | ||||
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Roll Forward] | ||||
Beginning balance | (293,113) | 159,854 | 83,588 | 208,378 |
Unrealized gains (losses) on investment securities | (170,400) | (32,185) | (649,750) | (94,724) |
Provision for income taxes | 36,265 | 6,848 | 138,209 | 20,148 |
Change in unrealized gains (losses) on investment securities | (134,135) | (25,337) | (511,541) | (74,576) |
Reclassification adjustments to net investment (gains) losses, net of taxes | 33 | (562) | 738 | (128) |
Change in net unrealized investment gains (losses) | (134,102) | (25,899) | (510,803) | (74,704) |
Ending balance | $ (427,215) | $ 133,955 | (427,215) | 133,955 |
Cumulative effect of change in accounting, net of taxes | ||||
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Roll Forward] | ||||
Beginning balance | 0 | |||
Cumulative effect of change in accounting, net of taxes | Net unrealized investment gains (losses) | ||||
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Roll Forward] | ||||
Beginning balance | $ 0 | $ 281 |
Investments - Summary of Fixed
Investments - Summary of Fixed Maturity Securities Classified as Available-for-Sale (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | $ 5,420,533 | $ 5,160,174 |
Gross unrealized gains | 135,931 | |
Gross unrealized losses | (29,766) | |
Fair value | 4,877,902 | 5,266,339 |
U.S. government, agencies and GSEs | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 46,322 | 56,547 |
Gross unrealized gains | 66 | 1,863 |
Gross unrealized losses | (1,734) | (2) |
Fair value | 44,654 | 58,408 |
State and political subdivisions | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 528,255 | 531,927 |
Gross unrealized gains | 2,429 | 10,982 |
Gross unrealized losses | (98,455) | (4,456) |
Fair value | 432,229 | 538,453 |
Non-U.S. government | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 10,643 | 22,358 |
Gross unrealized gains | 0 | 248 |
Gross unrealized losses | (1,391) | (190) |
Fair value | 9,252 | 22,416 |
U.S. corporate | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 2,918,599 | 2,863,100 |
Gross unrealized gains | 275 | 98,293 |
Gross unrealized losses | (279,690) | (16,090) |
Fair value | 2,639,184 | 2,945,303 |
Non-U.S. corporate | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 721,819 | 652,503 |
Gross unrealized gains | 17 | 17,556 |
Gross unrealized losses | (74,773) | (3,465) |
Fair value | 647,063 | 666,594 |
Residential mortgage-backed | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 11,941 | |
Gross unrealized gains | 0 | |
Gross unrealized losses | (198) | |
Fair value | 11,743 | |
Other asset-backed | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 1,182,954 | 1,033,739 |
Gross unrealized gains | 14 | 6,989 |
Gross unrealized losses | (89,191) | (5,563) |
Fair value | 1,093,777 | $ 1,035,165 |
Short-term investments | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 2,453 | |
Gross unrealized gains | 0 | |
Gross unrealized losses | (19) | |
Fair value | 2,434 | |
Total fixed maturity securities available-for-sale | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 5,420,533 | |
Gross unrealized gains | 2,801 | |
Gross unrealized losses | (545,432) | |
Fair value | 4,877,902 | |
Total investments available-for-sale | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 5,422,986 | |
Gross unrealized gains | 2,801 | |
Gross unrealized losses | (545,451) | |
Fair value | $ 4,880,336 |
Investments - Schedule of Fixed
Investments - Schedule of Fixed Maturity Securities in a Continuous Unrealized Loss Position (Details) $ in Thousands | Sep. 30, 2022 USD ($) security | Dec. 31, 2021 USD ($) security |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, Fair value | $ 4,107,852 | $ 1,555,842 |
Less than 12 months, Gross unrealized losses | $ (395,201) | $ (27,962) |
Less than 12 months, Number of securities | security | 1,006,000 | 247,000 |
12 months or more, Fair value | $ 704,280 | $ 29,917 |
12 months or more, Gross unrealized losses | $ (150,231) | $ (1,804) |
12 months or more, Number of securities | security | 135,000 | 5,000 |
Fair value | $ 4,812,132 | $ 1,585,759 |
Gross unrealized losses | $ (545,432) | $ (29,766) |
Number of securities | security | 1,141,000 | 252,000 |
U.S. government, agencies and GSEs | ||
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, Fair value | $ 43,752 | $ 103 |
Less than 12 months, Gross unrealized losses | $ (1,724) | $ (2) |
Less than 12 months, Number of securities | security | 18,000 | 1,000 |
12 months or more, Fair value | $ 95 | $ 0 |
12 months or more, Gross unrealized losses | $ (10) | $ 0 |
12 months or more, Number of securities | security | 1,000 | 0 |
Fair value | $ 43,847 | $ 103 |
Gross unrealized losses | $ (1,734) | $ (2) |
Number of securities | security | 19,000 | 1,000 |
State and political subdivisions | ||
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, Fair value | $ 315,865 | $ 255,202 |
Less than 12 months, Gross unrealized losses | $ (74,515) | $ (4,456) |
Less than 12 months, Number of securities | security | 63,000 | 47,000 |
12 months or more, Fair value | $ 84,279 | $ 0 |
12 months or more, Gross unrealized losses | $ (23,940) | $ 0 |
12 months or more, Number of securities | security | 26,000 | 0 |
Fair value | $ 400,144 | $ 255,202 |
Gross unrealized losses | $ (98,455) | $ (4,456) |
Number of securities | security | 89,000 | 47,000 |
Non-U.S. government | ||
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, Fair value | $ 0 | $ 10,560 |
Less than 12 months, Gross unrealized losses | $ 0 | $ (190) |
Less than 12 months, Number of securities | security | 0 | 1,000 |
12 months or more, Fair value | $ 9,252 | $ 0 |
12 months or more, Gross unrealized losses | $ (1,391) | $ 0 |
12 months or more, Number of securities | security | 1,000 | 0 |
Fair value | $ 9,252 | $ 10,560 |
Gross unrealized losses | $ (1,391) | $ (190) |
Number of securities | security | 1,000 | 1,000 |
U.S. corporate | ||
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, Fair value | $ 2,289,613 | $ 649,927 |
Less than 12 months, Gross unrealized losses | $ (199,380) | $ (14,300) |
Less than 12 months, Number of securities | security | 522,000 | 94,000 |
12 months or more, Fair value | $ 347,057 | $ 26,181 |
12 months or more, Gross unrealized losses | $ (80,310) | $ (1,790) |
12 months or more, Number of securities | security | 56,000 | 4,000 |
Fair value | $ 2,636,670 | $ 676,108 |
Gross unrealized losses | $ (279,690) | $ (16,090) |
Number of securities | security | 578,000 | 98,000 |
Non-U.S. corporate | ||
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, Fair value | $ 540,135 | $ 183,485 |
Less than 12 months, Gross unrealized losses | $ (52,646) | $ (3,465) |
Less than 12 months, Number of securities | security | 136,000 | 28,000 |
12 months or more, Fair value | $ 101,487 | $ 0 |
12 months or more, Gross unrealized losses | $ (22,127) | $ 0 |
12 months or more, Number of securities | security | 18,000 | 0 |
Fair value | $ 641,622 | $ 183,485 |
Gross unrealized losses | $ (74,773) | $ (3,465) |
Number of securities | security | 154,000 | 28,000 |
Other asset-backed | ||
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, Fair value | $ 906,744 | $ 456,565 |
Less than 12 months, Gross unrealized losses | $ (66,738) | $ (5,549) |
Less than 12 months, Number of securities | security | 261,000 | 76,000 |
12 months or more, Fair value | $ 162,110 | $ 3,736 |
12 months or more, Gross unrealized losses | $ (22,453) | $ (14) |
12 months or more, Number of securities | security | 33,000 | 1,000 |
Fair value | $ 1,068,854 | $ 460,301 |
Gross unrealized losses | $ (89,191) | $ (5,563) |
Number of securities | security | 294,000 | 77,000 |
Residential mortgage-backed | ||
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, Fair value | $ 11,743 | |
Less than 12 months, Gross unrealized losses | $ (198) | |
Less than 12 months, Number of securities | security | 6,000 | |
12 months or more, Fair value | $ 0 | |
12 months or more, Gross unrealized losses | $ 0 | |
12 months or more, Number of securities | security | 0 | |
Fair value | $ 11,743 | |
Gross unrealized losses | $ (198) | |
Number of securities | security | 6,000 |
Investments - Summary of Contra
Investments - Summary of Contractual Maturities of Fixed Maturity Securities Available-For-Sale (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Amortized cost | ||
Due one year or less | $ 214,145 | |
Due after one year through five years | 2,154,780 | |
Due after five years through ten years | 1,569,701 | |
Due after ten years | 287,012 | |
Subtotal | 4,225,638 | |
Amortized cost | 5,420,533 | |
Fair value | ||
Due one year or less | 212,697 | |
Due after one year through five years | 2,013,369 | |
Due after five years through ten years | 1,314,043 | |
Due after ten years | 232,273 | |
Subtotal | 3,772,382 | |
Fair value | 4,877,902 | $ 5,266,339 |
Residential mortgage-backed | ||
Amortized cost | ||
Debt securities, available-for-sale, maturity, without single maturity date, amortized cost | 11,941 | |
Fair value | ||
Debt securities, available-for-sale, maturity, without single maturity date, fair value | 11,743 | |
Fair value | 11,743 | |
Other asset-backed | ||
Amortized cost | ||
Debt securities, available-for-sale, maturity, without single maturity date, amortized cost | 1,182,954 | |
Fair value | ||
Debt securities, available-for-sale, maturity, without single maturity date, fair value | 1,093,777 | |
Fair value | $ 1,093,777 | $ 1,035,165 |
Investments - Narrative (Detail
Investments - Narrative (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||||
Allowance for credit losses | $ 0 | $ 0 | $ 0 | $ 0 |
Fixed maturity securities available-for-sale, at fair value (amortized cost of $5,420,533 and $5,160,174 as of September 30, 2022 and December 31, 2021, respectively) | 4,877,902 | 5,266,339 | ||
Deposits | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fixed maturity securities available-for-sale, at fair value (amortized cost of $5,420,533 and $5,160,174 as of September 30, 2022 and December 31, 2021, respectively) | $ 25,100 | $ 22,900 | ||
Financial Services Sector | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fixed maturity securities portfolio, percentage | 32% | |||
Non-Cyclical Consumer Sector | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fixed maturity securities portfolio, percentage | 12% | |||
Technology And Communications Sector | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fixed maturity securities portfolio, percentage | 14% |
Fair Value - Narrative (Details
Fair Value - Narrative (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | $ 4,877,902 | $ 5,266,339 |
U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 2,639,184 | 2,945,303 |
Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 647,063 | 666,594 |
Fair value, recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 4,877,902 | |
Liabilities, fair value | 0 | 0 |
Fair value, recurring | U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 2,639,184 | 2,945,303 |
Fair value, recurring | Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 647,063 | 666,594 |
Level 1 | Fair value, recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Level 1 | Fair value, recurring | U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Level 1 | Fair value, recurring | Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Level 2 | Fair value, recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | $ 4,574,706 | |
Percentage of portfolio priced using third-party pricing services | 89% | |
Level 2 | Fair value, recurring | U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | $ 2,422,247 | 2,724,570 |
Level 2 | Fair value, recurring | U.S. corporate | Internal models | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 165,300 | |
Level 2 | Fair value, recurring | Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 568,447 | 582,930 |
Level 2 | Fair value, recurring | Non-U.S. corporate | Internal models | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 91,700 | |
Level 3 | Fair value, recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 303,196 | |
Level 3 | Fair value, recurring | Internal models | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 292,300 | |
Level 3 | Fair value, recurring | Valuation technique, broker quotes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 10,800 | |
Level 3 | Fair value, recurring | U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 216,937 | 220,733 |
Level 3 | Fair value, recurring | U.S. corporate | Internal models | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 213,731 | |
Level 3 | Fair value, recurring | Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 78,616 | $ 83,664 |
Level 3 | Fair value, recurring | Non-U.S. corporate | Internal models | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | $ 78,614 |
Fair Value - Summary of Signifi
Fair Value - Summary of Significant Inputs used for Fair Value Measurement of Fixed Maturity Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | $ 4,877,902 | $ 5,266,339 |
State and political subdivisions | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 432,229 | 538,453 |
Non-U.S. government | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 9,252 | 22,416 |
U.S. corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 2,639,184 | 2,945,303 |
Non-U.S. corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 647,063 | 666,594 |
Residential mortgage-backed | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 11,743 | |
Other asset-backed | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 1,093,777 | 1,035,165 |
Fair value, recurring | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 4,877,902 | |
Fair value, recurring | U.S. government, agencies and GSEs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 44,654 | 58,408 |
Fair value, recurring | State and political subdivisions | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 432,229 | 538,453 |
Fair value, recurring | Non-U.S. government | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 9,252 | 22,416 |
Fair value, recurring | U.S. corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 2,639,184 | 2,945,303 |
Fair value, recurring | Non-U.S. corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 647,063 | 666,594 |
Fair value, recurring | Residential mortgage-backed | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 11,743 | |
Fair value, recurring | Other asset-backed | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 1,093,777 | 1,035,165 |
Level 2 | Fair value, recurring | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 4,574,706 | |
Level 2 | Fair value, recurring | U.S. government, agencies and GSEs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 44,654 | 58,408 |
Level 2 | Fair value, recurring | State and political subdivisions | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 432,229 | 538,453 |
Level 2 | Fair value, recurring | Non-U.S. government | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 9,252 | 22,416 |
Level 2 | Fair value, recurring | U.S. corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 2,422,247 | 2,724,570 |
Level 2 | Fair value, recurring | Non-U.S. corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 568,447 | 582,930 |
Level 2 | Fair value, recurring | Residential mortgage-backed | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 11,743 | |
Level 2 | Fair value, recurring | Other asset-backed | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 1,086,134 | $ 1,010,942 |
Pricing Services | Level 2 | Fair value, recurring | U.S. government, agencies and GSEs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 44,654 | |
Pricing Services | Level 2 | Fair value, recurring | State and political subdivisions | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 432,229 | |
Pricing Services | Level 2 | Fair value, recurring | Non-U.S. government | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 9,252 | |
Pricing Services | Level 2 | Fair value, recurring | U.S. corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 2,256,976 | |
Pricing Services | Level 2 | Fair value, recurring | Non-U.S. corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 476,784 | |
Pricing Services | Level 2 | Fair value, recurring | Residential mortgage-backed | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | 11,743 | |
Pricing Services | Level 2 | Fair value, recurring | Other asset-backed | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total fixed maturity securities | $ 1,086,134 |
Fair Value - Schedule of Fair V
Fair Value - Schedule of Fair Value Assets Measured on Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | $ 4,877,902 | $ 5,266,339 |
Short-term investments, at fair value | 2,434 | 0 |
State and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 432,229 | 538,453 |
Non-U.S. government | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 9,252 | 22,416 |
U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 2,639,184 | 2,945,303 |
Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 647,063 | 666,594 |
Residential mortgage-backed | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 11,743 | |
Other asset-backed | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 1,093,777 | 1,035,165 |
Fair value, recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 4,877,902 | |
Short-term investments, at fair value | 2,434 | |
Total | 4,880,336 | 5,266,339 |
Fair value, recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Short-term investments, at fair value | 0 | |
Total | 0 | 0 |
Fair value, recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 4,574,706 | |
Short-term investments, at fair value | 2,434 | |
Total | 4,577,140 | 4,937,719 |
Fair value, recurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 303,196 | |
Short-term investments, at fair value | 0 | |
Total | 303,196 | 328,620 |
Fair value, recurring | U.S. government, agencies and GSEs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 44,654 | 58,408 |
Fair value, recurring | U.S. government, agencies and GSEs | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Fair value, recurring | U.S. government, agencies and GSEs | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 44,654 | 58,408 |
Fair value, recurring | U.S. government, agencies and GSEs | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Fair value, recurring | State and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 432,229 | 538,453 |
Fair value, recurring | State and political subdivisions | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Fair value, recurring | State and political subdivisions | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 432,229 | 538,453 |
Fair value, recurring | State and political subdivisions | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Fair value, recurring | Non-U.S. government | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 9,252 | 22,416 |
Fair value, recurring | Non-U.S. government | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Fair value, recurring | Non-U.S. government | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 9,252 | 22,416 |
Fair value, recurring | Non-U.S. government | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Fair value, recurring | U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 2,639,184 | 2,945,303 |
Fair value, recurring | U.S. corporate | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Fair value, recurring | U.S. corporate | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 2,422,247 | 2,724,570 |
Fair value, recurring | U.S. corporate | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 216,937 | 220,733 |
Fair value, recurring | Non-U.S. corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 647,063 | 666,594 |
Fair value, recurring | Non-U.S. corporate | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Fair value, recurring | Non-U.S. corporate | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 568,447 | 582,930 |
Fair value, recurring | Non-U.S. corporate | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 78,616 | 83,664 |
Fair value, recurring | Residential mortgage-backed | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 11,743 | |
Fair value, recurring | Residential mortgage-backed | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | |
Fair value, recurring | Residential mortgage-backed | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 11,743 | |
Fair value, recurring | Residential mortgage-backed | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | |
Fair value, recurring | Other asset-backed | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 1,093,777 | 1,035,165 |
Fair value, recurring | Other asset-backed | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 0 | 0 |
Fair value, recurring | Other asset-backed | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | 1,086,134 | 1,010,942 |
Fair value, recurring | Other asset-backed | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total fixed maturity securities | $ 7,643 | $ 24,223 |
Fair Value - Schedule of Additi
Fair Value - Schedule of Additional Information about Fair Value Assets Measured on Recurring Basis, Unobservable Input Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning Balance | $ 315,013 | $ 230,785 | $ 328,620 | $ 228,905 |
Total realized and unrealized gains (losses) included in net income | (100) | 928 | (296) | 776 |
Total realized and unrealized gains (losses) included in OCI | (12,313) | (3,592) | (53,320) | (707) |
Purchases | 25,822 | 69,000 | 93,797 | 123,786 |
Settlements | (10,515) | (19,033) | (11,166) | (36,681) |
Transfer into Level 3 | 0 | 7,328 | 0 | 10,407 |
Transfer out of Level 3 | (14,711) | (3,010) | (54,439) | (44,080) |
Ending Balance | 303,196 | 282,406 | 303,196 | 282,406 |
Total gains (losses) attributable to assets still held included in net income | (100) | (113) | (296) | (260) |
Total gains (losses) attributable to assets still held included in OCI | (11,974) | (2,680) | (50,569) | (4,842) |
U.S. corporate | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning Balance | 216,654 | 129,613 | 220,733 | 119,373 |
Total realized and unrealized gains (losses) included in net income | (14) | (30) | (42) | (92) |
Total realized and unrealized gains (losses) included in OCI | (9,292) | (2,778) | (39,462) | (3,750) |
Purchases | 9,999 | 53,000 | 49,968 | 71,000 |
Settlements | (410) | (3,426) | (850) | (8,914) |
Transfer into Level 3 | 0 | 4,318 | 0 | 7,397 |
Transfer out of Level 3 | 0 | (3,010) | (13,410) | (7,327) |
Ending Balance | 216,937 | 177,687 | 216,937 | 177,687 |
Total gains (losses) attributable to assets still held included in net income | (14) | (30) | (42) | (92) |
Total gains (losses) attributable to assets still held included in OCI | (9,293) | (2,769) | (38,970) | (4,029) |
Non-U.S. corporate | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning Balance | 83,305 | 91,157 | 83,664 | 95,751 |
Total realized and unrealized gains (losses) included in net income | (86) | 958 | (254) | 868 |
Total realized and unrealized gains (losses) included in OCI | (2,498) | (644) | (11,768) | 3,147 |
Purchases | 8,000 | 6,000 | 21,009 | 42,786 |
Settlements | (10,105) | (14,148) | (10,316) | (25,044) |
Transfer into Level 3 | 0 | 3,010 | 0 | 3,010 |
Transfer out of Level 3 | 0 | 0 | (3,719) | (34,185) |
Ending Balance | 78,616 | 86,333 | 78,616 | 86,333 |
Total gains (losses) attributable to assets still held included in net income | (86) | (83) | (254) | (168) |
Total gains (losses) attributable to assets still held included in OCI | (2,501) | 235 | (11,476) | (683) |
Other asset-backed | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning Balance | 15,054 | 10,015 | 24,223 | 13,781 |
Total realized and unrealized gains (losses) included in net income | 0 | 0 | 0 | 0 |
Total realized and unrealized gains (losses) included in OCI | (523) | (170) | (2,090) | (104) |
Purchases | 7,823 | 10,000 | 22,820 | 10,000 |
Settlements | 0 | (1,459) | 0 | (2,723) |
Transfer into Level 3 | 0 | 0 | 0 | 0 |
Transfer out of Level 3 | (14,711) | 0 | (37,310) | (2,568) |
Ending Balance | 7,643 | 18,386 | 7,643 | 18,386 |
Total gains (losses) attributable to assets still held included in net income | 0 | 0 | 0 | 0 |
Total gains (losses) attributable to assets still held included in OCI | $ (180) | $ (146) | $ (123) | $ (130) |
Fair Value - Summary of Fair Va
Fair Value - Summary of Fair Value Assets Measured on Recurring Basis, Significant Unobservable Input (Details) $ in Thousands | Sep. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | $ 4,877,902 | $ 5,266,339 |
U.S. corporate | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | 2,639,184 | 2,945,303 |
Non-U.S. corporate | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | 647,063 | 666,594 |
Fair value, recurring | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | 4,877,902 | |
Fair value, recurring | U.S. corporate | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | 2,639,184 | 2,945,303 |
Fair value, recurring | Non-U.S. corporate | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | $ 647,063 | 666,594 |
Level 3 | U.S. corporate | Internal models | Credit spreads | Minimum | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fixed maturity securities, measurement input (in basis points) | 0.0050 | |
Level 3 | U.S. corporate | Internal models | Credit spreads | Maximum | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fixed maturity securities, measurement input (in basis points) | 0.0230 | |
Level 3 | U.S. corporate | Internal models | Credit spreads | Weighted average | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fixed maturity securities, measurement input (in basis points) | 0.0153 | |
Level 3 | Non-U.S. corporate | Internal models | Credit spreads | Minimum | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fixed maturity securities, measurement input (in basis points) | 0.0091 | |
Level 3 | Non-U.S. corporate | Internal models | Credit spreads | Maximum | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fixed maturity securities, measurement input (in basis points) | 0.0242 | |
Level 3 | Non-U.S. corporate | Internal models | Credit spreads | Weighted average | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fixed maturity securities, measurement input (in basis points) | 0.0159 | |
Level 3 | Fair value, recurring | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | $ 303,196 | |
Level 3 | Fair value, recurring | Internal models | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | 292,300 | |
Level 3 | Fair value, recurring | U.S. corporate | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | 216,937 | 220,733 |
Level 3 | Fair value, recurring | U.S. corporate | Internal models | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | 213,731 | |
Level 3 | Fair value, recurring | Non-U.S. corporate | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | 78,616 | $ 83,664 |
Level 3 | Fair value, recurring | Non-U.S. corporate | Internal models | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total fixed maturity securities | $ 78,614 |
Fair Value - Schedule of Estima
Fair Value - Schedule of Estimated Fair Value Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Carrying amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term borrowings | $ 742,211 | $ 740,416 |
Fair value | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term borrowings | $ 719,213 | $ 821,033 |
Loss Reserves - Activity for th
Loss Reserves - Activity for the Liability for Loss Reserves (Details) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||||
Loss reserves, beginning balance | $ 641,325 | $ 555,679 | ||
Run-off reserves | 665 | 701 | $ (681) | $ (654) |
Net loss reserves, beginning balance | 640,644 | 555,025 | ||
Losses and LAE incurred related to current accident year | 138,504 | 104,939 | ||
Losses and LAE incurred related to prior accident years | (250,799) | 14,468 | ||
Total incurred | (112,295) | 119,407 | ||
Losses and LAE paid related to current accident year | (1,005) | (1,574) | ||
Losses and LAE paid related to prior accident years | (17,772) | (25,194) | ||
Total paid | (18,777) | (26,768) | ||
Net loss reserves, ending balance | 509,572 | 647,664 | ||
Run-off reserves | (665) | (701) | $ 681 | $ 654 |
Loss reserves, ending balance | $ 510,237 | $ 648,365 |
Loss Reserves - Narrative (Deta
Loss Reserves - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Losses and LAE incurred related to current accident year | $ 138,504 | $ 104,939 |
Losses and LAE incurred | 138,504 | 104,939 |
Adjustments on prior accident year reserves | (250,799) | 14,468 |
Scenario One | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Losses and LAE incurred related to current accident year | 139,000 | |
Losses and LAE incurred | 139,000 | |
Adjustments on prior accident year reserves | 251,000 | |
Scenario Two | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Losses and LAE incurred related to current accident year | 25,000 | |
Losses and LAE incurred | $ 25,000 | |
Adjustments on prior accident year reserves | $ 10,000 |
Reinsurance - Summary of Effect
Reinsurance - Summary of Effects of Reinsurance on Premiums Written and Earned (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Net premiums written: | ||||
Direct | $ 243,655 | $ 252,719 | $ 732,079 | $ 738,848 |
Assumed | 64 | 78 | 198 | 249 |
Ceded | (20,453) | (18,500) | (58,884) | (53,150) |
Net premiums written | 223,266 | 234,297 | 673,393 | 685,947 |
Net premiums earned: | ||||
Direct | 255,449 | 261,485 | 765,411 | 790,986 |
Assumed | 64 | 78 | 198 | 249 |
Ceded | (20,453) | (18,500) | (58,884) | (53,150) |
Net premiums earned | $ 235,060 | $ 243,063 | $ 706,725 | $ 738,085 |
Reinsurance - Narrative (Detail
Reinsurance - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||||
Sep. 15, 2022 | Mar. 24, 2022 | Jan. 27, 2022 | Sep. 02, 2021 | Apr. 16, 2021 | Mar. 02, 2021 | Feb. 04, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Reinsurance Retention Policy [Line Items] | |||||||||||
Written premiums | $ 223,266 | $ 234,297 | $ 673,393 | $ 685,947 | |||||||
Premiums | $ 235,060 | $ 243,063 | $ 706,725 | $ 738,085 | |||||||
Reinsurance Policy, Type [Axis]: New Insurance Written | |||||||||||
Reinsurance Retention Policy [Line Items] | |||||||||||
Excess of loss reinsurance coverage | $ 201,000 | $ 325,000 | $ 294,000 | $ 206,000 | |||||||
Reinsurance Policy, Type [Axis]: Triangle Re 2021-1 Ltd. | |||||||||||
Reinsurance Retention Policy [Line Items] | |||||||||||
Excess of loss reinsurance coverage | $ 495,000 | ||||||||||
First layer of aggregate losses retained | $ 212,100 | ||||||||||
Reinsurance coverage for losses above retained first layer, percentage | 100% | ||||||||||
Vertical risk retention, percentage | 5% | ||||||||||
Reinsurance Policy, Type [Axis]: Triangle Re 2021-2 Ltd. | |||||||||||
Reinsurance Retention Policy [Line Items] | |||||||||||
Excess of loss reinsurance coverage | $ 302,700 | ||||||||||
First layer of aggregate losses retained | $ 188,600 | ||||||||||
Reinsurance coverage for losses above retained first layer, percentage | 76% | ||||||||||
Reinsurance Policy, Type [Axis]: Triangle Re 2021-3 Ltd. | |||||||||||
Reinsurance Retention Policy [Line Items] | |||||||||||
Excess of loss reinsurance coverage | $ 371,500 | ||||||||||
First layer of aggregate losses retained | $ 303,500 | ||||||||||
Reinsurance coverage for losses above retained first layer, percentage | 72% |
Borrowings - Narrative (Details
Borrowings - Narrative (Details) - USD ($) | Jun. 30, 2022 | Sep. 30, 2022 | Dec. 31, 2020 |
Line of Credit | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Debt instrument, term (in years) | 5 years | ||
Line of credit facility, maximum borrowing capacity | $ 200,000,000 | ||
Line of credit facility, additional borrowing capacity | $ 100,000,000 | ||
6.5% Senior Notes, due 2025 | Senior Notes | |||
Debt Instrument [Line Items] | |||
Face amount | $ 750,000,000 | ||
Stated interest rate | 6.50% | 6.50% |
Borrowings - Schedule of Long-t
Borrowings - Schedule of Long-term Borrowings (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | |||
Total | $ 742,211 | $ 740,416 | |
6.5% Senior Notes, due 2025 | Senior Notes | |||
Debt Instrument [Line Items] | |||
6.5% Senior Notes, due 2025 | 750,000 | 750,000 | |
Deferred borrowing charges | (7,789) | (9,584) | |
Total | $ 742,211 | $ 740,416 | |
Stated interest rate | 6.50% | 6.50% |
Related Party Transactions - Na
Related Party Transactions - Narrative (Details) - Genworth Holdings, Inc. - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Corporate Expenses | ||||
Related Party Transaction [Line Items] | ||||
Administrative and operating expenses | $ 7.5 | $ 8.1 | $ 22.9 | $ 37.2 |
Investment Expenses | ||||
Related Party Transaction [Line Items] | ||||
Expenses from transactions with related party | 1.4 | 1.3 | 4.2 | 4.2 |
Information Technology and Administrative Services | ||||
Related Party Transaction [Line Items] | ||||
Other revenues from transactions with related party | $ 0.2 | $ 0.1 | $ 0.6 | $ 0.2 |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Related Party Transactions (Details) - Genworth Holdings, Inc. - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Related Party Transaction [Line Items] | ||
Amounts payable to Genworth | $ 12,082 | $ 8,316 |
Amounts receivable from Genworth | $ 14 | $ 133 |
Net Income Per Common Share - S
Net Income Per Common Share - Schedule of Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 190,986 | $ 137,208 | $ 560,351 | $ 393,151 |
Net income per common share, basic (in usd per share) | $ 1.17 | $ 0.84 | $ 3.44 | $ 2.41 |
Net income per common share, diluted (in usd per share) | $ 1.17 | $ 0.84 | $ 3.43 | $ 2.41 |
Weighted average common shares outstanding - basic (in shares) | 162,843 | 162,840 | 162,842 | 162,840 |
Weighted average common shares outstanding - diluted (in shares) | 163,376 | 162,852 | 163,219 | 162,844 |
Changes in Accumulated Other _3
Changes in Accumulated Other Comprehensive Income - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 4,080,500 | $ 4,089,851 | $ 4,105,523 | $ 3,881,811 |
Other comprehensive income (loss) before reclassifications | (134,091) | (25,337) | (511,404) | (74,576) |
Amounts reclassified from other comprehensive income (loss) | 33 | (562) | 738 | (128) |
Total other comprehensive income (loss) | (134,058) | (25,899) | (510,666) | (74,704) |
Ending balance | 4,116,992 | 4,201,381 | 4,116,992 | 4,201,381 |
Cumulative effect of change in accounting, net of taxes | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 0 | |||
Net unrealized investment gains (losses) | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (293,113) | 159,854 | 83,588 | 208,378 |
Other comprehensive income (loss) before reclassifications | (134,135) | (25,337) | (511,541) | (74,576) |
Amounts reclassified from other comprehensive income (loss) | 33 | (562) | 738 | (128) |
Total other comprehensive income (loss) | (134,102) | (25,899) | (510,803) | (74,704) |
Ending balance | (427,215) | 133,955 | (427,215) | 133,955 |
Net unrealized investment gains (losses) | Cumulative effect of change in accounting, net of taxes | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 0 | 281 | ||
Foreign currency translation | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 86 | 0 | (7) | 0 |
Other comprehensive income (loss) before reclassifications | 44 | 0 | 137 | 0 |
Amounts reclassified from other comprehensive income (loss) | 0 | 0 | 0 | 0 |
Total other comprehensive income (loss) | 44 | 0 | 137 | 0 |
Ending balance | 130 | 0 | 130 | 0 |
Foreign currency translation | Cumulative effect of change in accounting, net of taxes | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 0 | |||
Accumulated other comprehensive income (loss) | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (293,027) | 159,854 | 83,581 | 208,378 |
Ending balance | $ (427,085) | $ 133,955 | $ (427,085) | 133,955 |
Accumulated other comprehensive income (loss) | Cumulative effect of change in accounting, net of taxes | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 281 |
Changes in Accumulated Other _4
Changes in Accumulated Other Comprehensive Income - Reclassification out of Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Benefit (expense) from income taxes | $ (53,658) | $ (37,401) | $ (155,086) | $ (107,196) |
Reclassification out of Accumulated Other Comprehensive Income | Net unrealized investment gains (losses) | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Net unrealized gains (losses) on investments | (42) | 711 | (935) | 162 |
Benefit (expense) from income taxes | $ 9 | $ (149) | $ 197 | $ (34) |