Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 19, 2019 | Jun. 30, 2018 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | TMK | ||
Entity Registrant Name | TORCHMARK CORP | ||
Entity Central Index Key | 320,335 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 110,236,297 | ||
Entity Public Float | $ 9 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Assets: | ||
Fixed maturities—available for sale, at fair value (amortized cost: 2018—$15,753,471; 2017—$14,995,101) | $ 16,297,932 | $ 16,969,325 |
Policy loans | 550,066 | 529,529 |
Other long-term investments (includes: 2018—$108,241; 2017—$0, under the fair value option) | 207,258 | 108,559 |
Short-term investments | 63,288 | 127,071 |
Total investments | 17,118,544 | 17,734,484 |
Cash | 121,026 | 118,563 |
Accrued investment income | 243,003 | 233,453 |
Other receivables | 415,157 | 391,775 |
Deferred acquisition costs | 4,137,925 | 3,958,063 |
Goodwill | 441,591 | 441,591 |
Other assets | 549,899 | 528,536 |
Assets related to discontinued operations | 68,577 | 68,520 |
Total assets | 23,095,722 | 23,474,985 |
Liabilities: | ||
Future policy benefits | 13,953,826 | 13,439,472 |
Unearned and advance premiums | 61,208 | 61,430 |
Policy claims and other benefits payable | 350,826 | 333,294 |
Other policyholders' funds | 97,459 | 97,635 |
Total policy liabilities | 14,463,319 | 13,931,831 |
Current and deferred income taxes payable | 1,047,737 | 1,312,002 |
Other liabilities | 453,270 | 489,609 |
Short-term debt | 307,848 | 328,067 |
Long-term debt (estimated fair value: 2018—$1,384,455; 2017—$1,228,392) | 1,357,185 | 1,132,201 |
Liabilities related to discontinued operations | 51,186 | 49,854 |
Total liabilities | 17,680,545 | 17,243,564 |
Commitments and Contingencies (Note 6) | ||
Shareholders’ equity: | ||
Preferred stock, par value $1 per share—5,000,000 shares authorized; outstanding: 0 in 2018 and 2017 | 0 | 0 |
Common stock, par value $1 per share—320,000,000 shares authorized; outstanding: (2018—121,218,183 issued; 2017—124,218,183 issued) | 121,218 | 124,218 |
Additional paid-in capital | 524,414 | 508,476 |
Accumulated other comprehensive income (loss) | 319,475 | 1,424,274 |
Retained earnings | 5,213,468 | 4,806,208 |
Treasury stock, at cost: (2018—10,525,147 shares; 2017—9,625,104 shares) | (763,398) | (631,755) |
Total shareholders’ equity | 5,415,177 | 6,231,421 |
Total liabilities and shareholders’ equity | $ 23,095,722 | $ 23,474,985 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fixed maturities, available for sale, amortized cost | $ 15,753,471 | $ 14,995,101 |
Limited partnerships, fair value | 399 | |
Long-term debt, fair value | $ 1,384,455 | $ 1,228,392 |
Preferred stock, par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized | 320,000,000 | 320,000,000 |
Common stock, shares issued | 121,218,183 | 124,218,183 |
Common stock, shares held in treasury | 10,525,147 | 9,625,104 |
Partnership Interest - Fair Value Option | Investment in limited partnerships | ||
Limited partnerships, fair value | $ 108,241 | $ 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Premium | $ 3,421,906 | $ 3,282,935 | $ 3,137,034 |
Net investment income | 882,512 | 847,885 | 806,903 |
Realized gains (losses) | (1,804) | 23,611 | (10,683) |
Other income | 1,137 | 1,142 | 1,375 |
Total revenue | 4,303,751 | 4,155,573 | 3,934,629 |
Life policyholder benefits | 1,591,790 | 1,558,261 | 1,479,272 |
Health policyholder benefits | 649,188 | 633,778 | 612,725 |
Other policyholder benefits | 34,264 | 35,836 | 36,751 |
Total policyholder benefits | 2,275,242 | 2,227,875 | 2,128,748 |
Amortization of deferred acquisition costs | 516,690 | 490,403 | 469,063 |
Commissions, premium taxes, and non-deferred acquisition costs | 278,487 | 264,860 | 249,174 |
Other operating expense | 279,585 | 257,255 | 232,064 |
Interest expense | 90,076 | 84,532 | 83,345 |
Total benefits and expenses | 3,440,080 | 3,324,925 | 3,162,394 |
Income before income taxes | 863,671 | 830,648 | 772,235 |
Income taxes | (162,161) | 627,615 | (232,645) |
Income from continuing operations | 701,510 | 1,458,263 | 539,590 |
Discontinued operations: | |||
Income (loss) from discontinued operations, net of tax | (44) | (3,769) | 10,189 |
Net income | $ 701,466 | $ 1,454,494 | $ 549,779 |
Basic net income (loss) per common share: | |||
Continuing operations (in dollars per share) | $ 6.22 | $ 12.53 | $ 4.50 |
Discontinued operations (in dollars per share) | 0 | (0.03) | 0.08 |
Total basic net income per common share (in dollars per share) | 6.22 | 12.50 | 4.58 |
Diluted net income (loss) per common share: | |||
Continuing operations (in dollars per share) | 6.09 | 12.26 | 4.41 |
Discontinued operations (in dollars per share) | 0 | (0.04) | 0.08 |
Total diluted net income per common share (in dollars per share) | $ 6.09 | $ 12.22 | $ 4.49 |
Life insurance | |||
Premium | $ 2,406,555 | $ 2,306,547 | $ 2,189,333 |
Health premium | |||
Premium | 1,015,339 | 976,373 | 947,663 |
Other premium | |||
Premium | $ 12 | $ 15 | $ 38 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net income | $ 701,466 | $ 1,454,494 | $ 549,779 |
Unrealized investment gains (losses): | |||
Total unrealized investment gains (losses) | (1,434,918) | 921,421 | 553,801 |
Less applicable (taxes) benefits | 301,327 | (322,553) | (193,820) |
Unrealized gains (losses) on investments, net of tax | (1,133,591) | 598,868 | 359,981 |
Unrealized gains (losses) attributable to deferred acquisition costs | 5,549 | (538) | (2,412) |
Less applicable (taxes) benefits | (1,165) | 188 | 845 |
Unrealized gains (losses) attributable to deferred acquisition costs, net of tax | 4,384 | (350) | (1,567) |
Foreign exchange translation adjustments, other than securities | (12,417) | 11,389 | 2,178 |
Less applicable (taxes) benefits | 2,610 | (2,937) | (838) |
Foreign exchange translation adjustments, other than securities, net of tax | (9,807) | 8,452 | 1,340 |
Pension adjustments: | |||
Amortization of pension costs | 15,095 | 12,436 | 10,168 |
Plan amendments | (2,377) | 0 | 0 |
Experience gain (loss) | 30,591 | (31,933) | (31,902) |
Pension adjustments | 43,309 | (19,497) | (21,734) |
Less applicable (taxes) benefits | (9,094) | 6,827 | 7,607 |
Pension adjustments, net of tax | 34,215 | (12,670) | (14,127) |
Other comprehensive income (loss) | (1,104,799) | 594,300 | 345,627 |
Comprehensive income (loss) | (403,333) | 2,048,794 | 895,406 |
Securities | |||
Unrealized investment gains (losses): | |||
Unrealized holding gains (losses) arising during period | (1,426,581) | 950,088 | 544,886 |
Reclassification adjustment for (gains) losses on securities included in net income | (5,715) | (34,954) | 10,645 |
Reclassification adjustment for amortization of (discount) premium | 3,957 | (47) | (4,185) |
Foreign exchange adjustment on securities recorded at fair value | (1,424) | 1,326 | 312 |
Total unrealized investment gains (losses) | (1,429,763) | 916,413 | 551,658 |
Other | |||
Unrealized investment gains (losses): | |||
Unrealized holding gains (losses) arising during period | (5,155) | 5,008 | 2,503 |
Reclassification adjustment for (gains) losses on securities included in net income | 0 | 0 | (360) |
Total unrealized investment gains (losses) | $ (5,155) | $ 5,008 | $ 2,143 |
Consolidated Statements of Shar
Consolidated Statements of Shareholder's Equity - USD ($) $ in Thousands | Total | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Treasury Stock |
Beginning balance at Dec. 31, 2015 | $ 4,055,552 | $ 0 | $ 130,218 | $ 482,284 | $ 231,947 | $ 3,614,369 | $ (403,266) |
Increase (Decrease) in Stockholders' Equity | |||||||
Comprehensive income (loss) | 895,406 | 345,627 | 549,779 | ||||
Common dividends declared ($.56 in 2016, $.60 in 2017 and $.16 in 2018 a share) | (66,968) | (66,968) | |||||
Acquisition of treasury stock | (404,784) | (404,784) | |||||
Stock-based compensation | 26,326 | 19,659 | (2,224) | 8,891 | |||
Exercise of stock options | 61,329 | 0 | (53,845) | 115,174 | |||
Retirement of treasury stock | 0 | (3,000) | (11,522) | (150,313) | 164,835 | ||
Ending balance at Dec. 31, 2016 | 4,566,861 | 0 | 127,218 | 490,421 | 577,574 | 3,890,798 | (519,150) |
Increase (Decrease) in Stockholders' Equity | |||||||
Comprehensive income (loss) | 2,048,794 | 594,300 | 1,454,494 | ||||
Common dividends declared ($.56 in 2016, $.60 in 2017 and $.16 in 2018 a share) | (69,494) | (69,494) | |||||
Acquisition of treasury stock | (412,989) | (412,989) | |||||
Stock-based compensation | 37,034 | 30,190 | (606) | 7,450 | |||
Exercise of stock options | 61,215 | 0 | (38,333) | 99,548 | |||
Reclassifications, Tax Reform | 252,400 | (252,400) | |||||
Retirement of treasury stock | 0 | (3,000) | (12,135) | (178,251) | 193,386 | ||
Ending balance at Dec. 31, 2017 | 6,231,421 | 0 | 124,218 | 508,476 | 1,424,274 | 4,806,208 | (631,755) |
Increase (Decrease) in Stockholders' Equity | |||||||
Comprehensive income (loss) | (403,333) | (1,104,799) | 701,466 | ||||
Common dividends declared ($.56 in 2016, $.60 in 2017 and $.16 in 2018 a share) | (71,941) | (71,941) | |||||
Acquisition of treasury stock | (421,749) | (421,749) | |||||
Stock-based compensation | 39,792 | 28,836 | (1,803) | 12,759 | |||
Exercise of stock options | 36,091 | (24,811) | 60,902 | ||||
Retirement of treasury stock | 0 | (3,000) | (12,898) | (200,547) | 216,445 | ||
Ending balance at Dec. 31, 2018 | $ 5,415,177 | $ 0 | $ 121,218 | $ 524,414 | $ 319,475 | $ 5,213,468 | $ (763,398) |
Consolidated Statements Of Sh_2
Consolidated Statements Of Shareholder's Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Stockholders' Equity [Abstract] | |||
Common dividends declared, per share (in dollars per share) | $ 0.64 | $ 0.6 | $ 0.56 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash provided from (used for) operating activities: | |||
Net income | $ 701,466 | $ 1,454,494 | $ 549,779 |
Adjustments to reconcile net income from continuing operations to cash provided from continuing operations: | |||
Loss (income) from discontinued operations, net of income taxes | 44 | 3,769 | (10,189) |
Increase (decrease) in future policy benefits | 664,997 | 687,407 | 645,844 |
Increase (decrease) in other policy benefits | 17,134 | 31,784 | 24,668 |
Deferral of policy acquisition costs | (699,551) | (660,134) | (635,318) |
Amortization of deferred policy acquisition costs | 516,690 | 490,403 | 469,063 |
Change in current and deferred income taxes | 69,369 | (700,660) | 152,210 |
Realized (gains) losses | 1,804 | (23,611) | 10,683 |
Other, net | 4,463 | 67,933 | 20,079 |
Net cash provided from (used for) continuing operations | 1,276,416 | 1,351,385 | 1,226,819 |
Net cash provided from (used for) discontinued operations | 1,231 | 77,673 | 171,889 |
Cash provided from (used for) operating activities | 1,277,647 | 1,429,058 | 1,398,708 |
Cash provided from (used for) investing activities: | |||
Fixed maturities available for sale—sold | 32,021 | 67,246 | 340,434 |
Fixed maturities available for sale—matured, called, and repaid | 343,712 | 488,843 | 236,353 |
Other long-term investments | 477 | 3,534 | 1,217 |
Total investments sold or matured | 376,210 | 559,623 | 578,004 |
Acquisition of investments: | |||
Fixed maturities—available for sale | (1,155,539) | (1,314,609) | (1,530,053) |
Other long-term investments | (93,631) | (55,096) | (20,444) |
Total investments acquired | (1,249,170) | (1,369,705) | (1,550,497) |
Net (increase) decrease in policy loans | (20,537) | (21,554) | (15,513) |
Net (increase) decrease in short-term investments | 63,783 | (55,031) | (17,274) |
Additions to properties | (45,092) | (20,285) | (25,162) |
Sale of other assets | 1,987 | 18 | 90 |
Investments in low-income housing interests | (23,404) | (19,890) | (32,084) |
Cash provided from (used for) investing activities | (896,223) | (926,824) | (1,062,436) |
Cash provided from (used for) financing activities: | |||
Issuance of common stock | 36,091 | 61,215 | 61,329 |
Cash dividends paid to shareholders | (71,421) | (68,831) | (66,931) |
Repayment of debt | (327,762) | (126,875) | (250,000) |
Proceeds from issuance of debt | 550,000 | 125,000 | 400,000 |
Payment for debt issuance costs | (6,969) | (1,661) | (9,638) |
Net borrowing (repayment) of commercial paper | (22,719) | 61,092 | 22,224 |
Acquisition of treasury stock | (421,749) | (412,989) | (404,784) |
Net receipts (payments) from deposit-type product | (126,991) | (90,932) | (71,991) |
Cash provided from (used for) financing activities | (391,520) | (453,981) | (319,791) |
Effect of foreign exchange rate changes on cash | 12,559 | (5,853) | (1,701) |
Increase (decrease) in cash | 2,463 | 42,400 | 14,780 |
Cash at beginning of year | 118,563 | 76,163 | 61,383 |
Cash at end of year | $ 121,026 | $ 118,563 | $ 76,163 |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Business : Torchmark Corporation (Torchmark or alternatively, the Company) through its wholly-owned subsidiaries provides a variety of life and supplemental health insurance products and annuities to a broad base of customers. Torchmark is organized into four reportable segments: life insurance, health insurance, annuity, and investment. Basis of Presentation : The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), under guidance issued by the Financial Accounting Standards Board (FASB). The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Principles of Consolidation : The consolidated financial statements include the results of Torchmark and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. When Torchmark acquires a subsidiary or a block of business, the assets acquired and the liabilities assumed are measured at fair value at the acquisition date. Any excess of acquisition cost over the fair value of net assets is recorded as goodwill. Expenses incurred to effect the acquisition are charged to earnings as of the acquisition date. Upon acquisition, the accounts and results of operations are consolidated as of and subsequent to the acquisition date. Torchmark accounts for its variable interest entities (VIEs) under accounting guidance which clarifies the definition of a variable interest and the instructions for consolidating VIEs. Only primary beneficiaries are required or allowed to consolidate VIEs. Therefore, a company may have voting control of a VIE, but if it is not the primary beneficiary, it is not permitted to consolidate the VIE. As further described under the caption Low-Income Housing Tax Credit Interests below in this note, Torchmark holds passive interests in limited partnerships which provide investment returns through the provision of tax benefits (principally from the transfer of federal or state tax credits related to federal low-income housing). These interests are considered to be VIEs. They are not consolidated because the Company has no power to control the activities that most significantly affect the economic performance of these entities and therefore the Company is not the primary beneficiary of any of these interests. Torchmark’s involvement is limited to its limited partnership interest in the entities. Torchmark has not provided any other financial support to the entities beyond its commitments to fund its limited partnership interests, and there are no arrangements or agreements with any of the interests to provide other financial support. The maximum loss exposure relative to these interests is limited to their carrying value. Discontinued Operations : When a component of Torchmark’s business is sold or expected to be sold during the ensuing year, Torchmark considers whether the criteria of ASC 205-20, Discontinued Operations , have been met, which includes evaluating if the disposal of a component represents a strategic shift that has, or will have, a major effect on the Company. If the disposal meets the criteria for discontinued operations, the assets and liabilities are segregated and recorded in the Consolidated Balance Sheets as "Assets and Liabilities related to discontinued operations" for all periods presented. If the carrying amount of the business exceeds its estimated fair value, a loss is recognized. The results of operations for the discontinued component are reported in "Income from discontinued operations, net of tax" in the Consolidated Statements of Operations for current and prior periods. Discontinued operations are reported commencing in the period in which the business is either disposed of or meets the accounting criteria for discontinued operations, including any gain or loss recognized on the sale or adjustment of the carrying amount to the estimated fair value less cost to sell. Torchmark sold one of its operating segments, Medicare Part D, during 2016. The financial results of this business are excluded from Torchmark's continuing operations including the Notes to the Consolidated Financial Statements . Investments : Torchmark classifies all of its fixed maturity investments as available for sale. Investments classified as available for sale are carried at fair value with unrealized gains and losses, net of deferred taxes, reflected directly in accumulated other comprehensive income. Policy loans are carried at unpaid principal balances. Other long-term investments include equity securities, real estate, commercial mortgage loan participations, and limited partnerships. Investments in equity securities are reported at fair value with changes in fair value, net of deferred taxes, reflected directly in " Realized Gains (Losses)" in the Consolidated Statements of Operations . Investments in real estate are reported at cost less allowances for depreciation. Depreciation is calculated on the straight-line method. Investments in certain limited partnerships are accounted for using the fair value option and fluctuations in fair value are reported in " Realized Gains (Losses) ." Short-term investments include investments in interest-bearing assets with original maturities of twelve months or less. Gains and losses realized on the disposition of investments are determined on a specific identification basis. Commercial mortgage loan participations, a type of investment where the mortgage loan is shared among investors, are accounted for as financing receivables. The commercial mortgage loan participations are managed by a third party. The Company purchased the legal rights to interests in commercial mortgage loans which are secured by properties such as hotels, retail, multiple family, or offices. The commercial mortgage loans typically have a term of three years with the option to extend up to two years. The commercial mortgages loans are recorded at unpaid principal balance, net of unamortized origination fees and net of allowance for loan losses, if applicable. Interest income, net of the amortization of origination fees, is recorded in "Net Investment Income" under the effective yield method. The Company evaluates the performance and credit quality of each individual commercial mortgage on a quarterly basis, or as needed, by utilizing common metrics such as loan-to-value and debt service coverage ratios as well as evaluating the fair value of the underlying collateral. The fair value of the underlying collateral is based on a third party appraisal of the property. The Company will also determine the probability of estimated losses for each commercial mortgage loan and record an allowance if conclusions are reached that collection of principal and interest are not probable. The allowance for loan losses are based on estimates, historical experience, probability of loss, value of the underlying collateral, and macro factors that affect the collectability of the loan. All assumptions are reviewed and updated as necessary. Fair Value Measurements, Investments in Securities : Torchmark measures the fair value of its fixed maturities based on a hierarchy consisting of three levels which indicate the quality of the fair value measurements as described below: • Level 1— fair values are based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date. • Level 2— fair values are based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, or inputs that can otherwise be corroborated by observable market data. • Level 3— fair values are based on inputs that are considered unobservable where there is little, if any, market activity for the asset or liability as of the measurement date. In this circumstance, the Company has to rely on values derived by independent brokers or internally-developed assumptions. Unobservable inputs are developed based on the best information available to the Company which may include the Company’s own data or bid and ask prices in the dealer market. The great majority of Torchmark's fixed maturities are not actively traded and direct quotes are not generally available. Management therefore determines the fair values of these securities after consideration of data provided by third-party pricing services, independent broker/dealers, and other resources. At December 31, 2018 , Torchmark's investments in fixed maturities were primarily composed of the following significant security types: corporate securities, state and municipal securities, and U.S. government securities. The remaining security types represented less than 2% of the total in the aggregate. Over 95% of the fair value reported at December 31, 2018 was determined using data provided by third-party pricing services. Prices provided by these services are not binding offers, but are estimated exit values. Third-party pricing services use proprietary pricing models to determine security values by discounting cash flows using a market-adjusted spread to a benchmark yield. For all asset classes within Torchmark’s significant security types, third-party pricing services use a common valuation technique to model the price of the investments using observable market data. The foundation for these models consists of developing yield spreads based on multiple observable market inputs, including but not limited to: benchmark yield curves, actual trading activity, new issue yields, broker-dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, sector-specific data, economic data, and other inputs that are corroborated in the market. Pricing vendors monitor and review their pricing data continuously with current market and economic data feeds, augmented by ongoing communication within the dealer community. Using the observable market inputs described above, spreads to an appropriate benchmark yield are further developed by the vendors for each security based on security-specific and/or sector-specific risk factors, such as a security’s terms and conditions (coupon, maturity, and call features), credit rating, sector, liquidity, collateral or other cash flow options, and other factors that could impact the risk of the security. Embedded repayment options, such as call and redemption features, are also taken into account in the pricing models. When the spread is determined, it is added to the security’s benchmark yield. The security's expected cash flows are discounted using this spread-adjusted yield, and the resulting present value of the discounted cash flows is the evaluated price. When third-party vendor prices are not available, the Company attempts to obtain valuations from other sources, including but not limited to broker/dealers, broker quotes, and prices on comparable securities. When valuations have been obtained for all securities in the portfolio, management reviews and analyzes the prices to ensure their reasonableness, taking into account available observable information. When two or more valuations are available for a security and the variance between the prices is 10% or less, the close correlation suggests similar observable inputs were used in deriving the price, and the mean of the prices is used. Securities valued in this manner are classified as Level 2. When the variance between two or more valuations for a security exceeds 10%, additional analysis is performed to determine the most appropriate value for that security, using resources such as broker quotes, prices on comparable securities, recent trades, and any other observable market data. Further review is performed on the available valuations to determine if they can be corroborated within reasonable tolerance to any other observable evidence. If one of the valuations or the mean of the available valuations for a security can be corroborated with other observable evidence, then the corroborated value is used and reported as Level 2. The Company uses information and analytical techniques deemed appropriate for determining the point within the range of reasonable fair value estimates that is most representative of fair value under current market conditions. Valuations that cannot be corroborated within a reasonable tolerance are classified as Level 3. Torchmark invests in a portfolio of private placement fixed maturities that are not actively traded. This portfolio is managed by third parties. The portfolio managers provide valuations for the bonds based on a pricing matrix utilizing observable inputs, such as the benchmark treasury rate and published sector indices, and unobservable inputs such as an internally-developed credit rating. If they cannot be corroborated, the fair values are classified as Level 3. The fair values for each class of security and by valuation hierarchy level are indicated in Note 4—Investments under the caption Fair value measurements and Note 9—Postretirement Benefits under the caption Pension Plans . Fair Value Measurements, Other Financial Instruments : Fair values for cash, short-term investments, short-term debt, commercial mortgage loan participations, limited partnerships, receivables, and payables approximate carrying value. Fair values of mortgage loans are determined based upon expected cash flows discounted at an appropriate risk-adjusted rate. The fair value of investments in limited partnerships that provide low-income housing tax credits is based on discounted projected cash flows. The commercial mortgage loan participations and the limited partnerships are classified as level 3. Policy loans are an integral part of Torchmark’s subsidiaries’ life insurance policies in force and their fair values cannot be valued separately and apart from the insurance contracts. The fair values of Torchmark’s long-term debt issues are based on the same methodology as investments in fixed maturities. At December 31, 2018 , observable inputs were available for these debt securities and as such were classified as Level 2 in the valuation hierarchy. The fair value for each debt instrument as of December 31, 2018 is disclosed in Note 11—Debt . As described in Note 9—Postretirement Benefits , Torchmark maintains a nonqualified supplemental retirement plan. Therefore the assets, that support the liability for this plan, are considered general assets of the Company. These assets consist of the cash value of corporate-owned life insurance policies (COLI) and exchange traded funds (ETFs). The fair value of the insurance cash values approximates carrying value. Fair values for the ETFs are derived from direct quotes and are considered Level 1 in the valuation hierarchy. Impairment of Investments : Torchmark’s portfolio of fixed maturities fluctuates in value due to changes in interest rates in the financial markets as well as other factors. Fluctuations caused by market interest rate changes have little bearing on whether or not the investment will be ultimately recoverable. Therefore, Torchmark considers these declines in value resulting from changes in market interest rates to be temporary. In certain circumstances, however, Torchmark determines that the decline in the value of a security is other-than-temporary and writes the book value of the security down to its fair value, realizing an investment loss. The evaluation of Torchmark’s securities for other-than-temporary impairments is a process that is undertaken at least quarterly and is overseen by a team of investment and accounting professionals. Each security, which is impaired because the fair value is less than the cost or amortized cost, is identified and evaluated. The determination that an impairment is other-than-temporary is highly subjective and involves the careful consideration of many factors. Among the factors considered are: • The length of time and extent to which the security has been impaired • The reason(s) for the impairment • The financial condition of the issuer and the prospects for recovery in fair value of the security • The Company’s ability and intent to hold the security until anticipated recovery • Expected future cash flows The relative weight given to each of these factors can change over time as facts and circumstances change. In many cases, management believes it is appropriate to give relatively more weight to prospective factors than to retrospective factors. Prospective factors that are given more weight include prospects for recovery, the Company’s ability and intent to hold the security until anticipated recovery, and expected future cash flows. Among the facts and information considered in the process are: • Financial statements of the issuer • Changes in credit ratings of the issuer • The value of underlying collateral • News and information included in press releases issued by the issuer • News and information reported in the media concerning the issuer • News and information published by or otherwise provided by securities, economic, or research analysts • The nature and amount of recent and expected future sources and uses of cash • Default on a required payment • Issuer bankruptcy filings While all available information is taken into account, it is difficult to predict the ultimate recoverable amount of a distressed or impaired security. If a security is determined to be other-than-temporarily impaired, the cost basis of the security is written down to fair value and is treated as a realized loss in the period the determination is made. The written-down security will be amortized and revenue recognized in accordance with estimated future cash flows. Current accounting guidance is such that if an entity intends to sell or if it is more likely than not that it will be required to sell an impaired security prior to recovery of its cost basis, the security is to be considered other-than-temporarily impaired and the full amount of impairment must be charged to earnings. Otherwise, losses on fixed maturities which are other-than-temporarily impaired are separated into two categories, the portion of loss which is considered credit loss and the portion of loss which is due to other factors. The credit loss portion is charged to earnings while the loss due to other factors is charged to other comprehensive income. The credit loss portion of an impairment is determined as the difference between the security’s amortized cost and the present value of expected future cash flows discounted at the security’s original effective yield rate. The temporary portion is the difference between this present value of expected future cash flows and fair value (as discounted by a market yield). The expected cash flows are determined using judgment and the best information available to the Company. Inputs used to derive expected cash flows include expected default rates, current levels of subordination, and loan-to-collateral value ratios. Cash : Cash consists of balances on hand and on deposit in banks and financial institutions. Accrued investment income : Accrued investment income consists of interest income or dividends earned on the investment portfolio, but are yet to be received as of the balance sheet date. The Company will write-off accrued investment income that is deemed to be uncollectible. Other Receivables : Other receivables consist mostly of agent debit balances that primarily represent commissions advanced to insurance agents. These balances are repaid to the Company over time as the premiums associated with the advanced commissions are collected by the Company and the agents' commissions on such premiums are retained. The balances were $396 million and $378 million at December 31, 2018 and 2017 , respectively. Management believes these balances are recoverable as they are less than the estimated present value of future commissions. Deferred Acquisition Costs : Certain costs of acquiring new insurance business are deferred and recorded as an asset. These costs are essential for the acquisition of new insurance business and are directly related to the successful issuance of an insurance contract including sales commissions, policy issue costs, and underwriting costs. Additionally, deferred acquisition costs (DAC) include the value of business acquired (VOBA), which are the costs of acquiring blocks of insurance from other companies or through the acquisition of other companies. These costs represent the difference between the fair value of the contractual insurance assets acquired and liabilities assumed compared against the assets and liabilities for insurance contracts that the Company issues or holds measured in accordance with GAAP. DAC and VOBA are amortized in a systematic manner which matches these costs with the associated revenues. Policies other than universal life-type policies are amortized with interest over the estimated premium-paying period of the policies in a manner which charges each year’s operations in proportion to the receipt of premium income. Universal life-type policies are amortized with interest in proportion to estimated gross profits. The assumptions used to amortize acquisition costs include interest, mortality, morbidity, and persistency, and are consistent with those used to estimate the liability for future policy benefits. For interest-sensitive and deposit-balance type products, these assumptions are reviewed on a regular basis and are revised if actual experience differs significantly from original expectations. For all other products, amortization assumptions are generally not revised once established. DAC and VOBA are subject to periodic recoverability and loss recognition testing to determine if there is a premium deficiency. These tests evaluate whether the present value of future contract-related cash flows will support the capitalized DAC and VOBA assets. These cash flows consist primarily of premium income, less benefits and expenses taking inflation into account. The present value of these cash flows, less the benefit reserve, is then compared with the unamortized deferred acquisition cost balance. In the event the estimated present value of net cash flows is less, the deficiency would be recognized by a charge to earnings and either a reduction of unamortized acquisition costs or an increase in the liability for future benefits, as described under the caption Future Policy Benefits . Advertising Costs : Costs related to advertising are generally charged to expense as incurred. However, certain Globe Life Direct Response advertising costs are capitalized when there is a reliable and demonstrated relationship between total costs and future benefits that is a direct result of incurring these costs. Globe Life Direct Response advertising costs consist primarily of the production and distribution costs of direct mail advertising materials, and when capitalized are included as a component of DAC. They are amortized in the same manner as other DAC. Globe Life Direct Response advertising costs charged to earnings and included in other operating expense were $9.0 million , $9.3 million , and $9.3 million in 2018 , 2017 , and 2016 , respectively. At December 31, 2018 , unamortized capitalized advertising costs included within DAC were $1.3 billion at December 31, 2018 and $1.3 billion at December 31, 2017 . Goodwill : The excess cost of a business acquired over the fair value of net assets acquired is reported as goodwill. Goodwill is subject to impairment testing in accordance with GAAP on an annual basis, or whenever potential impairment triggers occur. The Company may perform a qualitative analysis under certain circumstances, or perform a two-step quantitative analysis. In the qualitative analysis, the Company determines if it is more likely than not that the fair value of a reporting unit is less than its carrying amount by assessing current events and circumstances. If there are factors present indicating potential impairment, the Company would proceed to the two-step quantitative analysis. In the two-step quantitative analysis, the Company utilizes two approaches, income and market, to determine the fair value of each reporting unit. In the income approach, judgment and assumptions are used in developing the projected cash flows for the reporting units, and such estimates are subject to change. The Company also exercises judgment in the determination of the discount rate as management believes this to be appropriate for the risk associated with the cash flow expectations. In the market approach, the Company utilizes the share price and a control premium based on businesses with similar assets to determine a fair value. In both cases, the fair value of each reporting unit is then measured against that reporting unit’s corresponding carrying value. In the event the fair value is less than the carrying value, further testing is required under the accounting guidance to determine the amount of impairment, if any. If there is an impairment in the goodwill of any reporting unit, it is written down and charged to earnings in the period of the test. Torchmark tested its goodwill annually as of June 30th in each of the years 2016 through 2018 . Torchmark’s goodwill was not impaired in any of those periods. Low-Income Housing Tax Credit Interests : Torchmark invests in limited partnerships that provide low-income housing tax credits and other related federal income tax benefits to Torchmark. The carrying value of Torchmark’s investment in these entities was $226 million and $228 million at December 31, 2018 and 2017 , respectively and was included in "Other assets" on the Consolidated Balance Sheets. As of December 31, 2018 , Torchmark was obligated under future commitments of $51 million , which are recorded in "Other liabilities". For guaranteed investments acquired prior to January 1, 2015, the Company utilizes the effective-yield method of amortization, while the proportional method of amortization is utilized for all non-guaranteed and guaranteed investments acquired on or after January 1, 2015. All amortization expense is recorded in "Income tax benefit (expense)" on the Consolidated Statements of Operations . Property and Equipment : Property and equipment, included in “Other assets,” is reported at cost less allowances for depreciation. Depreciation is recorded primarily on the straight line method over the estimated useful lives of these assets which range from three to five years for equipment and ten to forty years for buildings and improvements. Ordinary maintenance and repairs are charged to income as incurred. Impairments, if any, are recorded when certain events and circumstances become evident that the fair value of the asset is less than its carrying amount. Original cost of property and equipment was $256 million at December 31, 2018 and $217 million at December 31, 2017 . Accumulated depreciation was $121 million at year end 2018 and $109 million at the end of 2017 . Depreciation expense was $13 million in 2018 , $11 million in 2017 , and $10 million in 2016 . Internally generated software costs are expensed as incurred in the preliminary project phase and post-implementation phase, and are capitalized during the application development stage. Future Policy Benefits : The liability for future policy benefits for annuity and universal life-type products is represented by policy account value. The liability for future policy benefits for all other life and health products, approximately 88% of total liabilities for future policy benefits, is determined on the net level premium method. This method provides for the present value of expected future benefit payments less the present value of expected future net premiums, based on estimated investment yields, mortality, morbidity, persistency, and other assumptions which were considered appropriate at the time the policies were issued. For limited-payment contracts, a deferred profit liability is also recorded which causes profits to emerge over the life of the contract in proportion to policies in force. Assumptions used for traditional life and health insurance products are based primarily on Company experience. Assumptions for interest rates range from 2.5% to 7.0% for Torchmark’s insurance companies with an overall weighted average assumed rate of 5.7% . Mortality tables used for individual life insurance include various statutory tables and modifications of a variety of generally accepted actuarial tables. Morbidity assumptions for individual health are based on Company experience and industry data. Withdrawal and termination assumptions are based on Torchmark’s experience. Once established, assumptions for these products are generally not changed. An additional provision is made on most products to allow for possible adverse deviation from the assumptions. These estimates are reviewed annually and compared with actual experience. If it is determined that existing contract liabilities, together with the present value of future gross premiums, will not be sufficient to cover the present value of future benefits and to recover unamortized deferred acquisition costs, then a premium deficiency exists. Such a deficiency would be recognized immediately by a charge to earnings and either a reduction of unamortized deferred acquisition costs or an increase in the liability for future policy benefits. From that point forward, the liability for future policy benefits would be based on revised assumptions. Policy Claims and Other Benefits Payable : Torchmark establishes a liability for known policy benefits payable and an estimate of claims that have been incurred but not yet reported to the Company. Torchmark makes an estimate of unreported claims after careful evaluation of all information available to the Company. This estimate is based on prior experience and is reviewed quarterly. However, there is no certainty the stated liability for claims and other benefits, including the estimate of unsubmitted claims, will be Torchmark’s ultimate obligation. See Note 7—Liability for Unpaid Claims for disclosures. Income Taxes : Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement book values and tax bases of assets and liabilities. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. On December 22, 2017, the Tax Cuts and Jobs Act (Tax Legislation) was enacted into law which changed existing tax law, including a reduction of the corporate income tax rate from 35% to 21% effective January 1, 2018. In 2017, the Company recorded $874 million in net income, primarily as a result of remeasuring its deferred assets and liabilities using the lower corporate tax rate as of the date of enactment. In the fourth quarter of 2018, the Company completed its analysis of the tax legislation and recorded an additional $798 thousand adjustment related to the remeasurement of the deferred tax assets and liabilities based on the 21% rate. More information concerning income taxes is provided in Note 8—Income Taxes . Postretirement Benefits : Torchmark accounts for its postretirement defined benefit plans by recognizing the funded status of those plans on its Consolidated Balance Sheets in accordance with accounting guidance. Periodic gains and losses attributable to changes in plan assets and liabilities that are not recognized as components of net periodic benefit costs are recognized as components of other comprehensive income, net of tax. More information concerning the accounting and disclosures for postretirement |
Statutory Accounting
Statutory Accounting | 12 Months Ended |
Dec. 31, 2018 | |
Insurance [Abstract] | |
Statutory Accounting | Statutory Accounting Life insurance subsidiaries of Torchmark are required to file statutory financial statements with state insurance regulatory authorities. Accounting principles used to prepare these statutory financial statements differ from GAAP. Consolidated net income and shareholders’ equity (capital and surplus) on a statutory basis for the insurance subsidiaries were as follows: Net Income Shareholders’ Equity Year Ended December 31, At December 31, 2018 2017 2016 2018 2017 Life insurance subsidiaries $ 437,549 $ 426,285 $ 429,563 $ 1,443,156 $ 1,254,875 The excess, if any, of shareholder’s equity of the insurance subsidiaries on a GAAP basis over that determined on a statutory basis is not available for distribution by the insurance subsidiaries to Torchmark without regulatory approval. Insurance subsidiaries’ statutory capital and surplus necessary to satisfy regulatory requirements in the aggregate was $499 million at December 31, 2018 . More information on the restrictions on the payment of dividends can be found in Note 12—Shareholders’ Equity . Torchmark’s statutory financial statements are presented on the basis of accounting practices prescribed by the insurance department of the state of domicile of each insurance subsidiary. While all states have adopted the National Association of Insurance Commissioners’ (NAIC) statutory accounting practices (NAIC SAP) as the basis for statutory accounting, certain states have retained prescribed practices of their respective insurance code or administrative code which can differ from NAIC SAP. For Torchmark’s life insurance companies, there are no significant differences between NAIC SAP and the accounting practices prescribed by the states of domicile. |
Supplemental Information about
Supplemental Information about Changes to Accumulated Other Comprehensive Income | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Supplemental Information about Changes to Accumulated Other Comprehensive Income | Supplemental Information about Changes to Accumulated Other Comprehensive Income An analysis in the change in balance by component of Accumulated Other Comprehensive Income is as follows for each of the years 2016 through 2018 . Components of Accumulated Other Comprehensive Income Available Deferred Foreign Pension Total For the year ended December 31, 2016: Balance at January 1, 2016 $ 332,333 $ (5,115 ) $ 3,627 $ (98,898 ) $ 231,947 Other comprehensive income (loss) before reclassifications, net of tax 356,016 (1,567 ) 1,340 (20,736 ) 335,053 Reclassifications, net of tax 3,965 — — 6,609 10,574 Other comprehensive income (loss) 359,981 (1,567 ) 1,340 (14,127 ) 345,627 Balance at December 31, 2016 692,314 (6,682 ) 4,967 (113,025 ) 577,574 For the year ended December 31, 2017: Other comprehensive income (loss) before reclassifications, net of tax 621,619 (350 ) 8,452 (20,753 ) 608,968 Reclassifications, net of tax (22,751 ) — — 8,083 (14,668 ) Other comprehensive income (loss) 598,868 (350 ) 8,452 (12,670 ) 594,300 Reclassifications, Tax reform 278,107 (1,515 ) 2,883 (27,075 ) 252,400 Balance at December 31, 2017 1,569,289 (8,547 ) 16,302 (152,770 ) 1,424,274 For the year ended December 31, 2018: Other comprehensive income (loss) before reclassifications, net of tax (1,132,202 ) 4,384 (9,807 ) 22,290 (1,115,335 ) Reclassifications, net of tax (1,389 ) — — 11,925 10,536 Other comprehensive income (loss) (1,133,591 ) 4,384 (9,807 ) 34,215 (1,104,799 ) Balance at December 31, 2018 $ 435,698 $ (4,163 ) $ 6,495 $ (118,555 ) $ 319,475 Reclassification adjustments out of Accumulated Other Comprehensive Income are presented below for each of the years 2016 through 2018 . Reclassification Adjustments Year Ended December 31, Component Line Item 2018 2017 2016 Affected line items in the Unrealized gains (losses) on available for sale assets: Realized (gains) losses $ (5,715 ) $ (34,954 ) $ 10,285 Realized investment gains (losses) Amortization of (discount) premium 3,957 (47 ) (4,185 ) Net investment income Total before tax (1,758 ) (35,001 ) 6,100 Tax 369 12,250 (2,135 ) Income taxes Total after tax (1,389 ) (22,751 ) 3,965 Pension adjustments: Amortization of prior service cost 535 476 477 Other operating expenses Amortization of actuarial (gain) loss 14,560 11,960 9,691 Other operating expenses Total before tax 15,095 12,436 10,168 Tax (3,170 ) (4,353 ) (3,559 ) Income taxes Total after tax 11,925 8,083 6,609 Total reclassifications (after tax) $ 10,536 $ (14,668 ) $ 10,574 |
Investments
Investments | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments Portfolio Composition : Summaries of fixed maturities available for sale by cost or amortized cost and estimated fair value at December 31, 2018 and 2017 are as follows. Redeemable preferred stock is included within the corporates by sector. At December 31, 2018 Cost or Gross Gross Fair Value (1) % of Total (2) Fixed maturities available for sale: U.S. Government direct, guaranteed, and government-sponsored enterprises $ 390,351 $ 5,104 $ (2,787 ) $ 392,668 2 States, municipalities, and political subdivisions 1,354,810 83,600 (1,750 ) 1,436,660 9 Foreign governments 19,006 1,810 — 20,816 — Corporates, by sector: Financial 3,759,768 262,875 (87,515 ) 3,935,128 24 Utilities 1,989,506 217,846 (24,399 ) 2,182,953 13 Energy 1,652,700 93,880 (62,371 ) 1,684,209 10 Other corporate sectors 6,382,707 283,524 (242,509 ) 6,423,722 40 Total corporates 13,784,681 858,125 (416,794 ) 14,226,012 87 Collateralized debt obligations 57,769 22,014 (6,414 ) 73,369 1 Other asset-backed securities 146,854 2,187 (634 ) 148,407 1 Total fixed maturities $ 15,753,471 $ 972,840 $ (428,379 ) $ 16,297,932 100 (1) Amount reported in the balance sheet. (2) At fair value. At December 31, 2017 Cost or Gross Gross Fair Value (1) % of Total (2) Fixed maturities available for sale: U.S. Government direct, guaranteed, and government-sponsored enterprises $ 390,646 $ 18,173 $ (1,373 ) $ 407,446 2 States, municipalities, and political subdivisions 1,091,960 127,890 (135 ) 1,219,715 7 Foreign governments 20,236 1,782 — 22,018 — Corporates, by sector: Financial 3,619,147 538,853 (26,119 ) 4,131,881 25 Utilities 1,984,290 371,538 (1,395 ) 2,354,433 14 Energy 1,619,349 226,140 (25,392 ) 1,820,097 11 Other corporate sectors 6,065,803 747,612 (20,616 ) 6,792,799 40 Total corporates 13,288,589 1,884,143 (73,522 ) 15,099,210 90 Collateralized debt obligations 59,150 20,084 (7,653 ) 71,581 — Other asset-backed securities 144,520 4,835 — 149,355 1 Total fixed maturities $ 14,995,101 $ 2,056,907 $ (82,683 ) $ 16,969,325 100 (1) Amount reported in the balance sheet. (2) At fair value. Securities, cash, and short-term investments held on deposit with various state and federal regulatory authorities had an amortized cost and fair value, respectively, of $712 million and $763 million at December 31, 2018 and $657 million and $753 million at December 31, 2017 . A schedule of fixed maturities available for sale by contractual maturity date at December 31, 2018 is shown below on an amortized cost basis and on a fair value basis. Actual disposition dates could differ from contractual maturities due to call or prepayment provisions. At December 31, 2018 Amortized Fair Fixed maturities available for sale: Due in one year or less $ 190,025 $ 192,792 Due after one year through five years 631,833 656,317 Due after five years through ten years 1,680,184 1,811,532 Due after ten years through twenty years 5,090,608 5,516,103 Due after twenty years 7,955,528 7,898,702 Mortgage-backed and asset-backed securities 205,293 222,486 $ 15,753,471 $ 16,297,932 Analysis of investment operations : Net investment income is summarized as follows: Year Ended December 31, 2018 2017 2016 Fixed maturities available for sale $ 843,510 $ 817,213 $ 778,912 Policy loans 41,359 39,578 38,436 Other long-term investments 10,638 4,991 2,786 Short-term investments 2,642 948 447 898,149 862,730 820,581 Less investment expense (15,637 ) (14,845 ) (13,678 ) Net investment income $ 882,512 $ 847,885 $ 806,903 An analysis of realized gains (losses) is as follows: Year Ended December 31, 2018 2017 2016 Realized investment gains (losses): Fixed maturities available for sale: Sales and other $ 5,715 $ 35,199 $ (10,645 ) Other-than-temporary impairments — (245 ) — Fair value option—change in fair value 2,650 — — Other investments 909 (7,302 ) (38 ) Realized gains (losses) from investments 9,274 27,652 (10,683 ) Realized loss on redemption of debt (1) (11,078 ) (4,041 ) — (1,804 ) 23,611 (10,683 ) Applicable tax 379 (6,021 ) 3,739 Realized gains (losses), net of tax $ (1,425 ) $ 17,590 $ (6,944 ) (1) Refer to Note 11—Debt for further discussion . An analysis of the net change in unrealized investment gains (losses) is as follows: Year Ended December 31, 2018 2017 2016 Change in investment gains (losses) on: Fixed maturities available for sale $ (1,429,763 ) $ 916,413 $ 551,658 Other investments (5,155 ) 5,008 2,143 Net change in unrealized gains (losses) $ (1,434,918 ) $ 921,421 $ 553,801 Additional information about securities sold is as follows: Year Ended December 31, 2018 2017 2016 Fixed maturities available for sale: Proceeds from sales (1) $ 32,021 $ 67,246 $ 358,285 Gross realized gains 66 5,079 6,133 Gross realized losses (13,996 ) (1,100 ) (32,608 ) (1) Includes unsettled sales of $17.9 million at December 31, 2016 . There were no unsettled sales in 2018 or 2017 . Fair value measurements : The following tables represent the fair value of fixed maturities measured on a recurring basis at December 31, 2018 and 2017 : Fair Value Measurements at December 31, 2018 Using: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value Fixed maturities available for sale: U.S. Government direct, guaranteed, and government-sponsored enterprises $ — $ 392,668 $ — $ 392,668 States, municipalities, and political subdivisions — 1,436,660 — 1,436,660 Foreign governments — 20,816 — 20,816 Corporates, by sector: Financial — 3,891,728 43,400 3,935,128 Utilities — 2,032,127 150,826 2,182,953 Energy — 1,645,077 39,132 1,684,209 Other corporate sectors — 6,103,609 320,113 6,423,722 Total corporates — 13,672,541 553,471 14,226,012 Collateralized debt obligations — — 73,369 73,369 Other asset-backed securities — 135,425 12,982 148,407 Total fixed maturities $ — $ 15,658,110 $ 639,822 $ 16,297,932 Percentage of total — % 96 % 4 % 100 % Fair Value Measurements at December 31, 2017 Using: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value Fixed maturities available for sale: U.S. Government direct, guaranteed, and government-sponsored enterprises $ — $ 407,446 $ — $ 407,446 States, municipalities, and political subdivisions 44 1,219,671 — 1,219,715 Foreign governments — 22,018 — 22,018 Corporates, by sector: Financial — 4,069,875 62,006 4,131,881 Utilities — 2,198,703 155,730 2,354,433 Energy — 1,779,281 40,816 1,820,097 Other corporate sectors — 6,468,541 324,258 6,792,799 Total corporates — 14,516,400 582,810 15,099,210 Collateralized debt obligations — — 71,581 71,581 Other asset-backed securities — 135,306 14,049 149,355 Total fixed maturities $ 44 $ 16,300,841 $ 668,440 $ 16,969,325 Percentage of total — % 96 % 4 % 100 % The following table represents changes in fixed maturities measured at fair value on a recurring basis using significant unobservable inputs (Level 3). Analysis of Changes in Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Asset- backed Securities Collateralized Debt Obligations Corporates Total Balance at January 1, 2016 $ — $ 70,382 $ 530,806 $ 601,188 Total gains or losses: Included in realized gains/losses — — 788 788 Included in other comprehensive income — (3,943 ) 6,403 2,460 Acquisitions — — 33,662 33,662 Sales — — — — Amortization — 5,186 17 5,203 Other (1) — (8,122 ) (12,076 ) (20,198 ) Transfers into (out of) Level 3 (2) — — — — Balance at December 31, 2016 — 63,503 559,600 623,103 Total gains or losses: Included in realized gains/losses — — — — Included in other comprehensive income 410 9,654 10,900 20,964 Acquisitions 14,000 — 21,666 35,666 Sales — — — — Amortization — 4,914 17 4,931 Other (1) (361 ) (6,490 ) (9,373 ) (16,224 ) Transfers into (out of) Level 3 (2) — — — — Balance at December 31, 2017 14,049 71,581 582,810 668,440 Total gains or losses: Included in realized gains/losses — — 698 698 Included in other comprehensive income (591 ) 3,170 (23,687 ) (21,108 ) Acquisitions — — 27,453 27,453 Sales — — — — Amortization — 4,737 16 4,753 Other (1) (476 ) (6,119 ) (38,352 ) (44,947 ) Transfers into (out of) Level 3 (2) — — 4,533 4,533 Balance at December 31, 2018 $ 12,982 $ 73,369 $ 553,471 $ 639,822 (1) Includes capitalized interest, foreign exchange adjustments and principal repayments. (2) There were no transfers in or out of Level 3 during 2016 and 2017. Acquisitions of Level 3 investments in each of the years 2016 through 2018 are comprised of private-placement fixed maturities managed by an unaffiliated third-party. Quantitative Information about Level 3 Fair Value Measurements As of December 31, 2018 Fair Value Valuation Significant Unobservable Range Weighted Asset-backed securities $ 12,982 Determination of credit spread Credit BBB- BBB- Discounted cash flows Discount 5.65% 5.65% Collateralized debt obligations 73,369 Discounted cash flows Discount 6.70 - 7.70% 7.51% Private placement fixed maturities 553,471 Determination of credit spread Credit A+ to BB- BBB Discounted cash flows Discount 3.62 - 11.30% 4.67% $ 639,822 The private placement fixed maturities and asset-backed securities reported as Level 3 are managed by third party investment managers. These securities are valued based on the contractual cash flows discounted by a yield determined as a treasury benchmark adjusted for a credit spread. The credit spread is developed from observable indices for similar public fixed maturities and unobservable indices for private fixed maturities for corresponding credit ratings. However, the credit ratings for the securities are considered unobservable inputs, as they are assigned by the third party investment manager based on a quantitative and qualitative assessment of the credit underwritten. A higher (lower) credit rating would result in a higher (lower) valuation. The collateral underlying collateralized debt obligations for which fair values are reported as Level 3 consists primarily of trust preferred securities issued by banks and insurance companies. Collateralized debt obligations are valued at the present value of expected future cash flows using an unobservable discount rate. Expected cash flows are determined by scheduling the projected repayment of the collateral assuming no future defaults, deferrals, or recoveries. The discount rate is risk-adjusted to take these items into account. A significant increase (decrease) in the discount rate will produce a significant decrease (increase) in fair value. Additionally, a significant increase (decrease) in the cash flow expectations would result in a significant increase (decrease) in fair value. For more information regarding valuation procedures, please refer to Note 1—Significant Accounting Policies under the caption Fair Value Measurements, Investments in Securities . The following table presents transfers in and out of each of the valuation levels of fair values. 2018 2017 2016 In Out Net In Out Net In Out Net Level 1 $ — $ — $ — $ 42,372 $ (597 ) $ 41,775 $ 45,344 $ — $ 45,344 Level 2 — (4,533 ) (4,533 ) 597 (42,372 ) (41,775 ) — (45,344 ) (45,344 ) Level 3 4,533 — 4,533 — — — — — — Transfers into Level 2 from Level 3 result from the availability of observable market data when a security is valued at the end of a period. Transfers into Level 3 occur when there is a lack of observable market information. Transfers into Level 1 from Level 2 occur when direct quotes are available; transfers from Level 1 into Level 2 result when only observable market data and no direct quotes are available. Transfers between levels are recognized as of the end of the period of transfer. Other-than-temporary impairments (OTTI) : Based on the Company's evaluation of its fixed maturities available for sale in an unrealized loss position in accordance with the OTTI policy as described in Note 1—Significant Accounting Policies , the Company concluded that there was an other-than-temporary impairment of $245 thousand ( $159 thousand , net of tax) during the year ended December 31, 2017 . For the years ended December 31, 2018 and 2016, there were no other-than-temporary impairments. As of year-end 2018 , previously written down securities remaining in the portfolio were carried at a fair value of $60 million , or less than 0.4% of the fair value of the fixed maturity portfolio. Torchmark is continuously monitoring the market conditions impacting its portfolio. While adverse market conditions for an extended duration could lead to some ratings downgrades in certain sectors, Torchmark has the ability and intent to hold these investments to recovery, and does not intend to sell or expect to be required to sell any of its securities in such a position. Unrealized gains/loss analysis : The following tables disclose gross unrealized investment losses by class and major sector of investments at December 31, 2018 and December 31, 2017 for the respective periods of time in a loss position. Torchmark considers these investments to be only temporarily impaired. Analysis of Gross Unrealized Investment Losses At December 31, 2018 Less than Twelve Months Twelve Months or Longer Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Fixed maturities available for sale: Investment grade securities: U.S. Government direct, guaranteed, and government-sponsored enterprises $ 37,182 $ (212 ) $ 89,664 $ (2,575 ) $ 126,846 $ (2,787 ) States, municipalities and political subdivisions 124,907 (1,648 ) 7,981 (102 ) 132,888 (1,750 ) Foreign governments — — — — — — Corporates, by sector: Financial 931,161 (36,337 ) 241,442 (21,572 ) 1,172,603 (57,909 ) Utilities 329,753 (11,680 ) 121,308 (9,442 ) 451,061 (21,122 ) Energy 475,736 (29,426 ) 54,937 (9,382 ) 530,673 (38,808 ) Other corporate sectors 2,515,541 (149,168 ) 575,796 (62,994 ) 3,091,337 (212,162 ) Total corporates 4,252,191 (226,611 ) 993,483 (103,390 ) 5,245,674 (330,001 ) Other asset-backed securities 44,603 (634 ) — — 44,603 (634 ) Total investment grade securities 4,458,883 (229,105 ) 1,091,128 (106,067 ) 5,550,011 (335,172 ) Below investment grade securities: States, municipalities and political subdivisions — — — — — — Corporates, by sector: Financial 22,087 (8,674 ) 81,101 (20,932 ) 103,188 (29,606 ) Utilities 28,613 (3,277 ) — — 28,613 (3,277 ) Energy 42,874 (3,901 ) 36,122 (19,662 ) 78,996 (23,563 ) Other corporate sectors 146,373 (7,235 ) 69,053 (23,112 ) 215,426 (30,347 ) Total corporates 239,947 (23,087 ) 186,276 (63,706 ) 426,223 (86,793 ) Collateralized debt obligations — — 13,586 (6,414 ) 13,586 (6,414 ) Total below investment grade securities 239,947 (23,087 ) 199,862 (70,120 ) 439,809 (93,207 ) Total fixed maturities $ 4,698,830 $ (252,192 ) $ 1,290,990 $ (176,187 ) $ 5,989,820 $ (428,379 ) Analysis of Gross Unrealized Investment Losses At December 31, 2017 Less than Twelve Months Twelve Months or Longer Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Fixed maturities available for sale: Investment grade securities: U.S. Government direct, guaranteed, and government-sponsored enterprises $ 34,388 $ (422 ) $ 47,514 $ (951 ) $ 81,902 $ (1,373 ) States, municipalities and political subdivisions 4,561 (21 ) 1,771 (9 ) 6,332 (30 ) Foreign governments — — — — — — Corporates, by sector: Financial 133,080 (652 ) 35,302 (1,429 ) 168,382 (2,081 ) Utilities 48,562 (569 ) 38,298 (826 ) 86,860 (1,395 ) Energy 23,463 (81 ) 67,775 (3,682 ) 91,238 (3,763 ) Other corporate sectors 220,661 (2,312 ) 163,886 (4,257 ) 384,547 (6,569 ) Total corporates 425,766 (3,614 ) 305,261 (10,194 ) 731,027 (13,808 ) Collateralized debt obligations — — — — — — Other asset-backed securities — — — — — — Total investment grade securities 464,715 (4,057 ) 354,546 (11,154 ) 819,261 (15,211 ) Below investment grade securities: States, municipalities and political subdivisions 200 (105 ) — — 200 (105 ) Corporates, by sector: Financial — — 108,808 (24,038 ) 108,808 (24,038 ) Energy 8,114 (104 ) 75,204 (21,525 ) 83,318 (21,629 ) Other corporate sectors 25,334 (5,066 ) 54,383 (8,981 ) 79,717 (14,047 ) Total corporates 33,448 (5,170 ) 238,395 (54,544 ) 271,843 (59,714 ) Collateralized debt obligations — — 12,347 (7,653 ) 12,347 (7,653 ) Total below investment grade securities 33,648 (5,275 ) 250,742 (62,197 ) 284,390 (67,472 ) Total fixed maturities $ 498,363 $ (9,332 ) $ 605,288 $ (73,351 ) $ 1,103,651 $ (82,683 ) Gross unrealized losses increased from $83 million at year end 2017 to $428 million at year end 2018 , an increase of $346 million . The increase in the gross unrealized losses from prior year was primarily attributable to the increase in market rates. Additional information about fixed maturities available for sale in an unrealized loss position is as follows: Less than Twelve Total Number of issues (CUSIP numbers) held: As of December 31, 2018 495 234 729 As of December 31, 2017 92 102 194 Torchmark’s entire fixed maturity portfolio consisted of 1,548 issues at December 31, 2018 and 1,502 issues at December 31, 2017 . The weighted-average quality rating of all unrealized loss positions at amortized cost was BBB+ for 2018 and BBB- for 2017 . Concentrations of Credit Risk : Torchmark maintains a diversified investment portfolio with limited concentration in any given issuer. At December 31, 2018 , the investment portfolio, at fair value, consisted of the following: Investment grade fixed maturities: Corporate securities 80 % Securities of state and municipal governments 8 Government-sponsored enterprises 2 Other 2 Below investment grade fixed maturities: Corporate securities 3 Other — Policy loans, which are secured by the underlying insurance policy values 3 Other investments 2 100 % As of December 31, 2018 , securities of state and municipal governments represented 8% of invested assets at fair value. Such investments are made throughout the U.S. At yearend 2018 , the state and municipal bond portfolio at fair value was invested in securities issued within the following states: Texas ( 30% ), Washington ( 7% ), Ohio ( 7% ), Florida ( 6% ), Illinois ( 6% ), and Michigan ( 4% ). Otherwise, there was no concentration within any given state greater than 4% . Corporate debt securities and redeemable preferred stocks represent 83% of Torchmark's investment portfolio. These investments are spread across a wide range of industries. Below are the ten largest industry concentrations held in the corporate portfolio of corporate debt securities and redeemable preferred stocks at December 31, 2018 , based on fair value: Insurance 15 % Electric utilities 11 Oil and natural gas pipelines 7 Banks 6 Transportation 4 Real estate investment trusts 4 Oil and natural gas exploration and production 4 Chemicals 4 Food 4 Gas utilities 3 At year end 2018 , 3% of invested assets at fair value were represented by fixed maturities rated below investment grade. Par value of these investments was $757 million , amortized cost was $666 million , and fair value was $601 million . While these investments could be subject to additional credit risk, such risk should generally be reflected in their fair value. Other investment information : Other long-term investments consist of the following: Year Ended December 31, 2018 2017 Investment in limited partnerships $ 108,241 $ 66,522 Commercial mortgage loan participations 96,266 39,489 Other 2,751 2,548 Total $ 207,258 $ 108,559 Torchmark held invested assets with a fair value of $399 thousand that were non-income producing during the twelve months ended December 31, 2018 . Commercial mortgage loan participations: Summaries of commercial mortgage loan participations at December 31, 2018 and 2017 are as follows: 2018 2017 Carrying Value % of Total Carrying Value % of Total Property type: Office $ 35,289 37 $ 18,378 46 Hospitality 15,137 16 10,496 27 Industrial 13,896 14 — — Retail 12,934 13 — — Mixed use 11,309 12 7,148 18 Multi-family 7,701 8 3,467 9 Total recorded investment 96,266 100 39,489 100 Less valuation allowance — — — — Carrying value, net of valuation allowance $ 96,266 100 $ 39,489 100 2018 2017 Carrying Value % of Total Carrying Value % of Total Geographic location: South Atlantic $ 39,414 41 $ 18,378 46 Middle Atlantic 23,488 24 3,467 9 Pacific 20,843 22 7,148 18 East North Central 10,531 11 10,496 27 West South Central 1,990 2 — — Total recorded investment 96,266 100 39,489 100 Less valuation allowance — — — — Carrying value, net of valuation allowance $ 96,266 100 $ 39,489 100 2018 Recorded Investment Debt Service Coverage Ratios <1.00x 1.00x—1.20x >1.20x Total % of Total Loan-to-value ratio: Less than 70% $ 18,343 $ 56,813 $ 10,531 $ 85,687 89 70% to 80% 10,579 — — 10,579 11 81% to 90% — — — — — Greater than 90% — — — — — Total $ 28,922 $ 56,813 $ 10,531 $ 96,266 100 2017 Recorded Investment Debt Service Coverage Ratios <1.00x 1.00x—1.20x >1.20x Total % of Total Loan-to-value ratio: Less than 70% $ — $ 18,378 $ 10,496 $ 28,874 73 70% to 80% 3,467 7,148 — 10,615 27 81% to 90% — — — — — Greater than 90% — — — — — Total $ 3,467 $ 25,526 $ 10,496 $ 39,489 100 As of December 31, 2018 and 2017 , the Company evaluated the commercial mortgage loan portfolio on a loan-by-loan basis to determine any allowance for loss. Factors considered include, but are not limited to, collateral value, loan-to-value ratio, debt service coverage ratio, local market conditions, credit quality of the borrower and tenants, and loan performance. As of December 31, 2018 and 2017 , there was no allowance for loss. |
Deferred Acquisition Costs
Deferred Acquisition Costs | 12 Months Ended |
Dec. 31, 2018 | |
Insurance [Abstract] | |
Deferred Acquisition Costs | Deferred Acquisition Costs An analysis of DAC is as follows: Year Ended December 31, 2018 2017 2016 Balance at beginning of year $ 3,958,063 $ 3,783,158 $ 3,617,135 Additions: Deferred during period: Commissions 497,459 465,920 436,252 Other expenses 202,092 194,214 199,066 Total deferred 699,551 660,134 635,318 Foreign exchange adjustment — 5,712 2,180 Adjustment attributable to unrealized investment losses (1) 5,549 — — Total additions 705,100 665,846 637,498 Deductions: Amortized during period (516,690 ) (490,403 ) (469,063 ) Foreign exchange adjustment (8,548 ) — — Adjustment attributable to unrealized investment gains (1) — (538 ) (2,412 ) Total deductions (525,238 ) (490,941 ) (471,475 ) Balance at end of year $ 4,137,925 $ 3,958,063 $ 3,783,158 (1) Represents amounts pertaining to investments relating to universal life-type products. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Reinsurance : Insurance affiliates of Torchmark reinsure that portion of insurance risk which is in excess of their retention limits. Retention limits for ordinary life insurance range up to $2 million per life. Life insurance ceded represented 0.4% of total life insurance in force at December 31, 2018 . Insurance ceded on life and accident and health products represented 0.2% of premium income for 2018 . Torchmark would be liable for the reinsured risks ceded to other companies to the extent that such reinsuring companies are unable to meet their obligations. Insurance affiliates also assume insurance risks of other external companies. Life reinsurance assumed represented 1.6% of life insurance in force at December 31, 2018 and reinsurance assumed on life and accident and health products represented 0.6% of premium income for 2018 . Leases : Torchmark leases office space, office equipment, and aviation equipment under a variety of operating lease arrangements. The Company does not have any capital leases. Rental expense for operating leases for each of the three years ended December 31, 2018 is as follows: Year Ended December 31, 2018 2017 2016 Rental expense $ 3,959 $ 6,446 $ 6,520 Future minimum rental commitments required under operating leases having remaining noncancelable lease terms in excess of one year at December 31, 2018 were as follows: Year Ended December 31, 2019 2020 2021 2022 2023 Thereafter Operating lease commitments $ 4,304 $ 4,208 $ 3,560 $ 2,755 $ 1,916 $ 6,596 Purchase Commitments : Torchmark has various long-term noncancelable purchase commitments as well as commitments to provide capital for low-income housing tax credit interests. See further discussion related to tax credits in Note 1—Significant Accounting Policies . Year Ended December 31, 2019 2020 2021 2022 2023 Thereafter Purchase commitments $ 27,938 $ 23,515 $ 4,121 $ 2,705 $ 3,018 $ 244,854 Investments : As of December 31, 2018 , Torchmark is committed to purchase $154 million of commercial mortgage loan participations from a third party by 2021 and $250 million to fund investments related to a limited partnership by 2022. Guarantees : At December 31, 2018 , Torchmark had in place three guarantee agreements, of which were either Parent Company guarantees of subsidiary obligations to a third party, or Parent Company guarantees of obligations between wholly-owned subsidiaries. As of December 31, 2018 , Torchmark had no liability with respect to these guarantees. Letters of Credit : Torchmark has guaranteed letters of credit in connection with its credit facility with a group of banks as disclosed in Note 11—Debt . The letters of credit were issued by TMK Re, Ltd., a wholly-owned subsidiary, to secure TMK Re, Ltd.’s obligation for claims on certain policies reinsured by TMK Re, Ltd. that were sold by other Torchmark insurance companies. These letters of credit facilitate TMK Re, Ltd.’s ability to reinsure the business of Torchmark’s insurance carriers. The agreement expires in 2021. The maximum amount of letters of credit available is $250 million . The Parent Company would be liable to the extent that TMK Re, Ltd. does not pay the reinsured party. On March 14, 2018, the letters of credit were amended to reduce the current amount outstanding to $155 million from $177 million as of December 31, 2017. As of December 31, 2018 , the letters of credit outstanding were $155 million . Equipment leases : Torchmark has guaranteed performance of certain subsidiaries as lessees under two aviation leasing arrangements. At December 31, 2018 , total remaining undiscounted payments under the leases were approximately $8 million . The Parent Company would be responsible for any subsidiary obligation in the event the subsidiary did not make payments or otherwise perform under the terms of the lease. Unclaimed Property Audits : Torchmark subsidiaries are currently the subject of audits regarding the identification, reporting and escheatment of unclaimed property arising from life insurance policies and a limited number of annuity contracts. These audits are being conducted by private entities that have contracted with forty-seven states through their respective Departments of Revenue, and have not resulted in any financial assessment from any state nor indicated any liability. The audits are wide-ranging and seek large amounts of data regarding claims handling, procedures, and payments of contract benefits arising from unreported death claims. No estimate of range can be made at this time for loss contingencies related to possible administrative penalties or amounts that could be payable to the states for the escheatment of abandoned property. Litigation : Torchmark and its subsidiaries, in common with the insurance industry in general, are subject to litigation, including putative class action litigation , alleged breaches of contract, torts, including bad faith and fraud claims based on alleged wrongful or fraudulent acts of agents of Torchmark’s subsidiaries, employment discrimination, and miscellaneous other causes of action. Based upon information presently available, and in light of legal and other factual defenses available to Torchmark and its subsidiaries, management does not believe that it is reasonably possible that such litigation will have a material adverse effect on Torchmark’s financial condition, future operating results or liquidity; however, assessing the eventual outcome of litigation necessarily involves forward-looking speculation as to judgments to be made by judges, juries and appellate courts in the future. This bespeaks caution, particularly in states with reputations for high punitive damage verdicts. Torchmark’s management recognizes that large punitive damage awards bearing little or no relation to actual damages continue to be awarded by juries in jurisdictions in which Torchmark and its subsidiaries have substantial business, creating the potential for unpredictable material adverse judgments in any given punitive damage suit. On September 12, 2018, putative class action litigation was filed against American Income Life Insurance Company in California’s Contra Costa County Superior Court ( Joh v. American Income Life Insurance Company , Case No. C18-01863). An amended complaint was filed on October 18, 2018. American Income removed the case to the United States District Court for the Northern District of California (Case No. 3:18-cv-06364-TSH). The plaintiff, a former insurance sales agent of American Income, is suing on behalf of all current and former sales agents who sold insurance for American Income in the state of California for the four years prior to the filing of the complaint. The amended complaint alleges that such individuals are employees and asserts claims under the California Labor Code, California Business and Professions Code, and California Private Attorney General Act. The complaint seeks compensatory damages, penalties and attorney fees on claims for failure to pay wages/commissions, failure to appropriately pay agents at termination, failure to provide itemized wage statements, failure to reimburse expenses and unfair business practices. The Company continues to assess the amount and thus does not have a reasonable estimate of any potential liability. On October 18, 2018, putative class action litigation was filed against Torchmark Corporation and American Income Life Insurance Company in California’s Los Angeles County Superior Court ( Golz v. American Income Life Insurance Company , et al Case No. 18STCV01354). American Income removed the case to the United States District Court for the Central District of California (Case No. 2:18-cv-09879 R (SSx)). An amended complaint was filed on February 5, 2019. The amended complaint alleges that the putative class members are employees and asserts claims under the California Labor Code and California Business and Professions Code. The complaint alleges that plaintiff was an American Income insurance agent trainee in California who seeks to represent a class of individuals in California whom American Income classified as independently contracted agent trainees. The class period is alleged to begin four years prior to the complaint’s filing. The complaint seeks compensatory damages, penalties, and attorney fees on claims for failure to pay minimum wage and overtime, failure to provide meal and rest breaks, failure to appropriately pay wages at termination, failure to provide itemized wage statements, failure to reimburse business expenses, and unfair business practices. The Company continues to assess the amount and thus does not have a reasonable estimate of any potential liability. On December 14, 2018, putative class action litigation was filed against American Income Life Insurance Company in United States District Court for the Northern District of California ( Hamilton v. American Income Life Insurance Company , Case No. 4:18-cv-7535-KAW). An amended complaint was filed on January 23, 2019. The plaintiffs, former insurance sales agents of American Income, are suing on behalf of all current and former sales agents who sold insurance for American Income in the state of California for the last four years prior to the filing of the complaint. The lawsuit alleges that putative class members are employees and asserts claims under the California Labor Code, California Business and Professions Code, and California Private Attorney General Act. The complaint seeks compensatory damages, penalties and attorney fees on claims for failure to pay minimum wage and overtime, failure to provide meal and rest breaks, failure to appropriately pay agents at termination, failure to provide itemized wage statements, failure to reimburse expenses, and unfair business practices. The Company continues to assess the amount and thus does not have a reasonable estimate of any potential liability. On January 16, 2019, putative class action litigation was filed against American Income Life Insurance Company in Orange County, California Superior Court ( Putros v. American Income Life Insurance Company , Case No. 30-2019-01044772-CU-OE-CXC). The plaintiff, a former insurance sales agent of American Income, is suing on behalf of all current and former sales agents who sold insurance for American Income in the state of California for the last four years prior to the filing of the complaint. The lawsuit alleges that putative class members are employees and asserts claims under the California Labor Code, California Business and Professions Code, and California Private Attorney General Act. The complaint seeks compensatory damages, penalties and attorney fees on claims for failure to pay minimum wage, failure to provide meal and rest breaks, failure to appropriately pay agents at termination, failure to provide itemized wage statements, failure to reimburse expenses, and unfair business practices. The Company continues to assess the amount and thus does not have a reasonable estimate of any potential liability. With respect to its current litigation, at this time management believes that the possibility of a material judgment adverse to Torchmark is remote, and no estimate of range can be made for loss contingencies that are at least reasonably possible but not accrued. Guaranty Fund Assessment : In 2017, the Commonwealth Court of Pennsylvania issued orders placing Penn Treaty Network America Insurance Company (Penn Treaty) and affiliate American Network Insurance Company (ANIC) in liquidation due to financial difficulties. In such instances, the various state guaranty fund associations employ funding mechanisms, through assessments to their member companies, to cover the obligations of the insolvent entities. Consequently, the Company continues to receive guaranty fund assessments from the state associations related to these companies. The Company has projected its share of the ultimate assessments from these insolvencies based on assumptions about future events and its market share of premiums by state. We anticipate a majority of the estimates will be recoverable through state premium tax credit offsets. In 2017, we recorded $1.8 million as the estimated amount deemed unrecoverable. |
Liability for Unpaid Claims
Liability for Unpaid Claims | 12 Months Ended |
Dec. 31, 2018 | |
Insurance [Abstract] | |
Liability for Unpaid Claims | Liability for Unpaid Claims Activity in the liability for unpaid health claims is summarized as follows: Year Ended December 31, 2018 2017 2016 Balance at beginning of year $ 146,865 $ 143,128 $ 137,120 Incurred related to: Current year 555,647 520,528 510,075 Prior years (3,017 ) (8,048 ) (1,127 ) Total incurred 552,630 512,480 508,948 Paid related to: Current year 424,633 394,506 386,278 Prior years 120,334 114,237 116,662 Total paid 544,967 508,743 502,940 Balance at end of year $ 154,528 $ 146,865 $ 143,128 At the end of each period, the liability for unpaid health claims includes an estimate of claims incurred but not yet reported to the Company. Such estimates are updated regularly based upon the Company’s most recent claims data with recognition of emerging experience trends. Due to the nature of the Company’s health business, the payment lags are relatively short and most claims are fully paid within a year from the time incurred. Fluctuations in claims experience can lead to either over or under estimation of the liability for any given year. The difference between the estimate made at the end of the prior period and the actual experience during the period is reflected above under the caption “Incurred related to: Prior years.” Below is the reconciliation of the liability for "Policy claims and other benefits payable" in the Consolidated Balance Sheets . At December 31, 2018 2017 Policy claims and other benefits payable: Life insurance $ 196,298 $ 186,429 Health insurance 154,528 146,865 Total $ 350,826 $ 333,294 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The following table discloses significant components of income taxes for each year presented: Year Ended December 31, 2018 2017 2016 Income tax expense (benefit) from continuing operations: Current income tax expense (benefit) $ 134,626 $ 138,262 $ 132,806 Deferred income tax expense (benefit) 27,535 (765,877 ) 99,839 162,161 (627,615 ) 232,645 Shareholders’ equity: Other comprehensive income (loss) (293,678 ) 318,475 186,206 $ (131,517 ) $ (309,140 ) $ 418,851 In each of the years 2016 through 2018 , deferred income tax expense (benefit) was incurred because of certain differences between net income before income tax expense (benefit) as reported on the Consolidated Statements of Operations and taxable income as reported on Torchmark’s income tax returns. As explained in Note 1—Significant Accounting Policies , these differences caused the consolidated financial statement book values of some assets and liabilities to be different from their respective tax bases. Due to the passage of tax legislation in 2017, the Company recorded an $877 million deferred income tax benefit as a result of remeasuring its deferred assets and liabilities using the lower corporate tax rate as of the date of enactment. In the fourth quarter of 2018, the Company completed its analysis of the tax legislation, as required by ASC 740 Income Taxes, and recorded an additional $798 thousand adjustment related to the remeasurement of the deferred tax assets and liabilities based on the 21% rate. The effective income tax rate differed from the expected U.S. federal statutory rate of 21% for 2018 and 35% for prior years as shown below: Year Ended December 31, 2018 % 2017 % 2016 % Expected federal income tax expense (benefit) $ 181,371 21.0 $ 290,727 35.0 $ 270,282 35.0 Increase (reduction) in income taxes resulting from: Tax reform adjustment (798 ) (0.1 ) (877,400 ) (105.6 ) — — Low income housing investments (12,240 ) (1.4 ) (18,515 ) (2.2 ) (18,202 ) (2.4 ) Share-based awards (6,450 ) (0.7 ) (19,549 ) (2.4 ) (18,653 ) (2.4 ) Other 278 — (2,878 ) (0.4 ) (782 ) (0.1 ) Income tax expense (benefit) $ 162,161 18.8 $ (627,615 ) (75.6 ) $ 232,645 30.1 The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below: December 31, 2018 2017 Deferred tax assets: Fixed maturity investments $ 6,131 $ 8,692 Carryover of tax losses 7,406 4,760 Total gross deferred tax assets 13,537 13,452 Deferred tax liabilities: Unrealized gains 87,871 380,251 Employee and agent compensation 70,551 65,576 Deferred acquisition costs 633,687 618,889 Future policy benefits, unearned and advance premiums, and policy claims 242,285 248,752 Other liabilities 25,603 11,289 Total gross deferred tax liabilities 1,059,997 1,324,757 Net deferred tax liability $ 1,046,460 $ 1,311,305 Income Tax Return : Torchmark and all of its subsidiaries file a life-nonlife consolidated federal income tax return for the year ended December 31, 2018 . Family Heritage Life Insurance Company (Family Heritage) filed its federal income tax return on a separate company basis for the taxable years prior to 2018. The statutes of limitations for the Internal Revenue Service's examination and assessment of additional tax are closed for all tax years prior to 2015 with respect to Torchmark’s consolidated as well as Family Heritage's federal income tax returns. Management believes that adequate provision has been made in the consolidated financial statements for any potential assessments that may result from current or future tax examinations and other tax-related matters for all open years. Valuations : Torchmark has net operating loss carryforwards of approximately $35.3 million at December 31, 2018 that will begin to expire in 2033 if not otherwise used to offset future taxable income. A valuation allowance is to be provided when it is more likely than not that deferred tax assets will not be realized by the Company. No valuation allowance has been recorded relating to Torchmark’s deferred tax assets as management believes Torchmark will more likely than not have sufficient taxable income in future periods to fully realize its existing deferred tax assets. Torchmark’s tax liability is adjusted to include a provision for uncertain tax positions taken or expected to be taken in a tax return. However, during the years 2016 through 2018 , Torchmark did not have any uncertain tax positions which resulted in unrecognized tax benefits. Tax penalties and interest: Torchmark’s continuing practice is to recognize penalties and interest related to income tax matters in income tax expense. No penalties or interest were recognized in 2018 , however the Company recognized interest income of $5 thousand and $9 thousand , net of federal income tax expense, in its Consolidated Statements of Operations for 2017 and 2016 , respectively. The Company had no accrued interest or penalties at December 31, 2018 or 2017 . |
Postretirement Benefits
Postretirement Benefits | 12 Months Ended |
Dec. 31, 2018 | |
Retirement Benefits [Abstract] | |
Postretirement Benefits | Postretirement Benefits Torchmark has qualified noncontributory defined benefit pension plans and contributory savings plans that cover substantially all employees. There is also a nonqualified noncontributory supplemental executive retirement plan (SERP) that covers a limited number of employees. The total cost of these retirement plans charged to operations was as follows: Year Ended December 31, Defined (1) Defined (2) 2018 $ 4,068 $ 32,593 2017 4,145 28,828 2016 3,614 24,202 (1) 401K plans (2) Qualified pension plans and SERP Torchmark accrues expense for the defined contribution plans based on a percentage of the employees’ contributions. The plans are funded by the employee contributions and a Torchmark contribution equal to the amount of accrued expense. Plan contributions are both mandatory and discretionary, depending on the terms of the plan. Pension Plans : Cost for the defined benefit pension plans has been calculated on the projected unit credit actuarial cost method. All plan measurements for the defined benefit plans are as of December 31 of the respective year. The defined benefit pension plans covering the majority of employees are qualified and funded. Contributions are made to funded pension plans subject to minimums required by regulation and maximums allowed for tax purposes. Torchmark's SERP provides to a limited number of executives an additional supplemental defined pension benefit. The supplemental benefit is based on the participant’s qualified plan benefit without consideration to the regulatory limits on compensation and benefit payments applicable to qualified plans, except that eligible compensation is capped at $1 million . The SERP is nonqualified and unfunded. However, a Rabbi Trust has been established to support the liability for this plan. The trust consists of life insurance policies on the lives of plan participants with an unaffiliated insurance carrier as well as an investment account. Since this plan is nonqualified, the investments and the policyholder value of the insurance policies in the Rabbi Trust are not included as defined benefit plan assets, but rather assets of the Company. They are included in “Other Assets” in the Consolidated Balance Sheets . Defined benefit and SERP plan contributions were $52.8 million in 2018 , $21.3 million in 2017 , and $15.8 million in 2016 . The following table includes premiums paid for the SERP for the three years ended December 31, 2018 and investments of the Rabbi Trust for the two years ended December 31, 2018 . Year Ended December 31, 2018 2017 2016 Premiums paid for insurance coverage $ 2,997 $ 2,050 $ 2,050 At December 31, 2018 2017 Total investments: Company owned life insurance $ 44,285 $ 40,273 Exchange traded funds 52,659 55,442 $ 96,944 $ 95,715 Plan assets in the funded plans consist primarily of investments in marketable fixed maturities and equity securities that are valued at fair value. Torchmark measures the fair value of its financial assets, including the assets in its benefit plans, in accordance with accounting guidance which establishes a hierarchy for asset values and provides a methodology for the measurement of value. Please refer to Note 1—Significant Accounting Policies under the caption Fair Value Measurements , Investments in Securities for a complete discussion of valuation procedures. The following table presents the assets of Torchmark’s defined benefit pension plans for the years ended December 31, 2018 and 2017 . Pension Assets by Component at December 31, 2018 Fair Value Determined by: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Amount % to Total Corporate bonds: Financial $ — $ 44,236 $ — $ 44,236 11 Utilities — 39,443 — 39,443 10 Energy — 19,744 — 19,744 5 Other corporates — 83,202 — 83,202 22 Total corporate bonds — 186,625 — 186,625 48 Exchange traded fund (1) 157,717 — — 157,717 40 Other bonds — 245 — 245 — Other long-term investments — 8,475 — 8,475 2 Guaranteed annuity contract (2) — 26,505 — 26,505 7 Short-term investments 9,289 — — 9,289 2 Other 3,816 — — 3,816 1 Total $ 170,822 $ 221,850 $ — $ 392,672 100 (1) A fund including marketable securities that mirror the S&P 500 index. (2) Representing a guaranteed annuity contract issued by Torchmark's subsidiary, American Income Life Insurance Company, to fund the obligations of the American Income Pension Plan. Pension Assets by Component at December 31, 2017 Fair Value Determined by: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Amount % to Total Corporate bonds: Financial $ — $ 43,451 $ — $ 43,451 12 Utilities — 46,144 — 46,144 12 Energy — 25,023 — 25,023 7 Other corporates — 65,888 — 65,888 17 Total corporate bonds — 180,506 — 180,506 48 Exchange traded fund (1) 164,351 — — 164,351 43 Other bonds — 256 — 256 — Other long-term investments — 2,304 — 2,304 1 Guaranteed annuity contract (2) — 21,202 — 21,202 6 Short-term investments 3,984 — — 3,984 1 Other 5,021 — — 5,021 1 Total $ 173,356 $ 204,268 $ — $ 377,624 100 (1) A fund including marketable securities that mirror the S&P 500 index. (2) Representing a guaranteed annuity contract issued by Torchmark's subsidiary, American Income Life Insurance Company, to fund the obligations of the American Income Pension Plan. Torchmark’s investment objectives for its plan assets include preservation of capital, preservation of purchasing power, and long-term growth. Torchmark seeks to preserve capital through investments made in high quality securities with adequate diversification by issuer and industry sector to minimize risk. The portfolio is monitored continuously for changes in quality and diversification mix. The preservation of purchasing power is intended to be accomplished through asset growth, exclusive of contributions and withdrawals in excess of the rate of inflation. Torchmark intends to maintain investments that when combined with future plan contributions will produce adequate long-term growth to provide for all plan obligations. It is also Torchmark’s objective that the portfolio’s investment return will meet or exceed the return of a balanced market index. The majority of the securities in the portfolio are highly marketable so that there will be adequate liquidity to meet projected payments. There are no specific policies calling for asset durations to match those of benefit obligations. Allowed investments are limited to equities, fixed maturities, and short-term investments (invested cash). The assets are to be invested in a mix of equity and fixed income investments that best serve the objectives of the pension plan. Factors to be considered in determining the asset mix include funded status, annual pension expense, annual pension contributions, and balance sheet liability. Equities can include common and preferred stocks, securities convertible into equities, mutual funds and exchange traded funds that invest in equities, equity interests in limited partnerships, and other equity-related investments. Primarily, equities are listed on major exchanges and adequate market liquidity is required. Fixed maturities primarily consist of marketable debt securities rated investment grade at purchase by a major rating agency. Short-term investments include fixed maturities with maturities less than one year and invested cash. Short-term investments in commercial paper must be rated at least A-2 by Standard & Poor’s with the issuer rated investment grade. Invested cash is limited to banks rated A or higher. Investments outside of the aforementioned list are not permitted, except by prior approval of the Plan’s Trustees. The investment portfolio is to be well diversified to avoid undue exposure to a single sector, industry, business, or security. The equity and fixed maturity portfolios are not permitted to invest in any single issuer that would exceed 10% of total plan assets at the time of purchase. Torchmark does not employ any other special risk management techniques, such as derivatives, in managing the pension investment portfolio. Torchmark's equity securities include an exchange traded fund that mirrors the S&P 500 index which better aligns with a passive approach rather than an actively managed portfolio. At December 31, 2018 , there were no restricted investments contained in the portfolio. Plan contributions have been invested primarily in fixed maturity and equity securities during the three years ended December 31, 2018 . The following table presents projected benefit obligation (PBO) and accumulated benefit obligation (ABO) for the defined benefit pension plans and SERP at December 31, 2018 and 2017 . Pension Liability December 31, 2018 2017 PBO ABO PBO ABO Funded defined benefit pension $ 481,792 $ 436,316 $ 518,141 $ 466,307 SERP 74,407 69,582 84,465 74,656 $ 556,199 $ 505,898 $ 602,606 $ 540,963 The following table discloses the assumptions used to determine Torchmark’s pension liabilities and costs for the appropriate periods. The discount and compensation increase rates are used to determine current year projected benefit obligations and subsequent year pension expense. The long-term rate of return is used to determine current year expense. Differences between assumptions and actual experience are included in actuarial gain or loss. Weighted Average Pension Plan Assumptions For Benefit Obligations at December 31: 2018 2017 Discount rate 4.37 % 3.75 % Rate of compensation increase 4.00 4.37 For Periodic Benefit Cost for the Year: 2018 2017 2016 Discount rate 3.75 % 4.27 % 4.64 % Expected long-term returns 6.72 6.96 7.19 Rate of compensation increase 4.37 4.31 4.33 The discount rate is determined based on the expected duration of plan liabilities. A yield is then derived based on the current market yield of a hypothetical portfolio of higher-quality corporate bonds that match the liability duration. The rate of compensation increase is projected based on Company experience, modified as appropriate for future expectations. The expected long-term rate of return on plan assets is management’s best estimate of the average rate of earnings expected to be received on the assets invested in the plan over the benefit period. In determining this assumption, consideration is given to the historical rate of return earned on the assets, the projected returns over future periods, and the discount rate used to compute benefit obligations. Net periodic benefit cost for the defined benefit plans by expense component was as follows: Year Ended December 31, 2018 2017 2016 Service cost—benefits earned during the period $ 21,092 $ 17,942 $ 15,502 Interest cost on projected benefit obligation 22,303 22,124 21,631 Expected return on assets (25,547 ) (23,597 ) (23,127 ) Net amortization 15,003 12,281 10,135 Recognition of actuarial loss (258 ) 78 61 Net periodic benefit cost $ 32,593 $ 28,828 $ 24,202 An analysis of the impact on other comprehensive income (loss) concerning pensions and other postretirement benefits is as follows: Year Ended December 31, 2018 2017 2016 Balance at January 1 $ (193,380 ) $ (173,883 ) $ (152,149 ) Amortization of: Prior service cost 535 476 477 Net actuarial (gain) loss (1) 14,560 11,960 9,691 Total amortization 15,095 12,436 10,168 Plan amendments (2,377 ) — — Experience gain (loss) 30,591 (31,933 ) (31,902 ) Balance at December 31 $ (150,071 ) $ (193,380 ) $ (173,883 ) (1) Includes amortization of postretirement benefits other than pensions of $92 thousand in 2018 , $155 thousand in 2017 , and $33 thousand in 2016 . The following table presents a reconciliation from the beginning to the end of the year of the PBO and plan assets for the defined benefit plans and SERP. This table also presents the amounts previously recognized as a component of accumulated other comprehensive income. Pension Benefits Year Ended December 31, 2018 2017 Changes in PBO: PBO at beginning of year $ 602,606 $ 527,522 Service cost 21,092 17,942 Interest cost 22,303 22,124 Plan amendments 2,377 — Actuarial loss (gain) (67,270 ) 55,369 Benefits paid (24,909 ) (20,351 ) PBO at end of year 556,199 602,606 Changes in plan assets: Fair value at beginning of year 377,624 328,871 Return on assets (12,824 ) 47,832 Contributions 52,781 21,272 Benefits paid (24,909 ) (20,351 ) Fair value at end of year 392,672 377,624 Funded status at year end $ (163,527 ) $ (224,982 ) Amounts recognized in accumulated other comprehensive income consist of: Net loss (gain) $ 143,453 $ 186,563 Prior service cost 5,976 4,135 Net amounts recognized at year end $ 149,429 $ 190,698 The portion of other comprehensive income that is expected to be reflected in pension expense in 2019 is as follows: Amortization of prior service cost $ 631 Amortization of net actuarial loss 7,580 Total $ 8,211 Torchmark has estimated its expected pension benefits to be paid over the next ten years as of December 31, 2018 . These estimates use the same assumptions that measure the benefit obligation at December 31, 2018 , taking estimated future employee service into account. Those estimated benefits are as follows: For the year(s): 2019 $ 21,442 2020 23,159 2021 24,806 2022 26,847 2023 28,661 2024-2028 167,177 |
Supplemental Disclosures of Cas
Supplemental Disclosures of Cash Flow Information | 12 Months Ended |
Dec. 31, 2018 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Disclosures of Cash Flow Information | Supplemental Disclosures of Cash Flow Information The following table summarizes Torchmark’s noncash transactions, which are not reflected on the Consolidated Statements of Cash Flows: Year Ended December 31, 2018 2017 2016 Stock-based compensation not involving cash $ 39,792 $ 37,034 $ 26,326 Commitments for low-income housing interests 50,883 33,846 56,818 Exchanges of fixed maturity investments 193,449 84,312 224,901 Net unsettled security trades 39,851 — 15,020 The following table summarizes certain amounts paid during the period: Year Ended December 31, 2018 2017 2016 Interest paid $ 83,518 $ 82,494 $ 81,338 Income taxes paid 91,510 74,379 79,790 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Debt | Debt The following table presents information about the terms and outstanding balances of Torchmark’s debt. Selected Information about Debt Issues As of December 31, 2018 2017 Annual Interest Rate Issue Date Periodic Interest Payments Due Outstanding Principal (Par Value) Outstanding Principal (Book Value) Outstanding Principal (Fair Value) Outstanding Principal (Book Value) Long-term debt: Notes, due 5/15/23 (3,5) 7.875 % 5/93 5/15 & 11/15 $ 165,612 $ 164,490 $ 192,945 $ 164,284 Senior Notes, due 6/15/19 (3,14) 9.250 % 6/09 6/15 & 12/15 — — — 291,888 Senior Notes, due 9/15/22 (3,7) 3.800 % 9/12 3/15 & 9/15 150,000 148,777 150,481 148,477 Senior Notes, due 9/15/28 (3,7) 4.550 % 9/18 3/15 & 9/15 550,000 543,169 558,825 — Junior Subordinated Debentures due 3/15/36 (4,11,15) — % (12) (10) quarterly — — — 20,000 Junior Subordinated Debentures due 6/15/56 (4,8,11) 6.125 % 4/16 quarterly 300,000 290,520 301,200 290,460 Junior Subordinated Debentures due 11/17/57 (4,9) 5.275 % 11/17 6/15 & 12/15 125,000 123,354 94,129 123,342 Term loan due 5/17/21 (1,6) 3.595 % (13) 6/16 monthly 93,750 93,750 93,750 98,125 1,384,362 1,364,060 1,391,330 1,136,576 Less current maturity of term loan 6,875 6,875 6,875 4,375 Total long-term debt 1,377,487 1,357,185 1,384,455 1,132,201 Short-term debt: Current maturity of term loan 6,875 6,875 6,875 4,375 Commercial paper (2) 302,100 300,973 300,973 323,692 Total short-term debt 308,975 307,848 307,848 328,067 Total debt $ 1,686,462 $ 1,665,033 $ 1,692,303 $ 1,460,268 (1) The term loan has higher priority than all other debt issues. (2) Commercial paper has priority over all other debt except the term loan. (3) All securities, other than the term loan, commercial paper and Junior Subordinated Debentures have equal priority with one another. (4) All Junior Subordinated Debentures have equal priority, but are subordinate to all other issues. (5) Not callable. (6) Callable anytime. (7) Callable subject to “make-whole” premium. (8) Callable at any time on or after June15, 2021, and prior to this date upon the occurrence of a Tax Event or Rating Agency Event. (9) Callable at any time on or after November 17, 2022, and prior to this date upon the occurrence of a Tax Event or Rating Agency Event. (10) Assumed upon November 1, 2012 acquisition of Family Heritage. (11) Quarterly payments on the 15th of March, June, September, and December. (12) Interest paid at 3 Month LIBOR plus 330 basis points, resets each quarter. (13) Interest paid at 1 Month LIBOR plus 125 basis points, resets each month. (14) Redeemed on October 29, 2018. (15) Redeemed on June 15, 2018. Contractual Debt Obligations : The following table presents expected scheduled principal payments under our contractual debt obligations: Year Ended December 31, 2019 2020 2021 2022 2023 Thereafter Debt obligations $ 308,975 $ 9,375 $ 77,500 $ 150,000 $ 165,612 $ 975,000 Funded debt : On September 27, 2018, Torchmark completed the issuance and sale of $550 million in aggregate principal of Torchmark’s 4.55% Senior Notes due 2028. The notes were sold pursuant to Torchmark’s shelf registration statement on Form S-3. The net proceeds from the sale of the notes were $543 million , after giving effect to the underwriting discounts and commissions and offering expenses payable by Torchmark. Torchmark used the net proceeds from the sale of the notes to redeem the $293 million outstanding principal amount on Torchmark’s 9.25% Senior Notes on October 29, 2018, the payment of $11 million for the make-whole premium plus accrued and unpaid interest of $10 million , and to fund $150 million of additional capital to its insurance subsidiaries. Torchmark used the remaining net proceeds to repay outstanding commercial paper and for general corporate purposes. The Company recorded an $11 million loss on redemption of debt to Realized gains (losses) on the Consolidated Statements of Operations for the make-whole premium and removal of unamortized debt issuance cost. Due to increasing variable interest rates, on June 15, 2018, the Company called its $20 million Junior Subordinated Debentures. On November 17, 2017, Torchmark completed the issuance and sale of $125 million in aggregate principal of Torchmark’s 5.275% Junior Subordinated Debentures due 2057. The debentures were sold in a private placement pursuant to exemptions from the registration requirements of the Securities Act of 1933. The initial purchaser of the debentures was outside the United States. The net proceeds from the sale of the debentures were $123 million , after giving effect to the discount payable to the initial purchaser and expenses of the offering of the debentures. Torchmark used the net proceeds from the offering of the debentures to repay the $125 million outstanding principal, plus accrued interest of $143 thousand on the 5.875% Junior Subordinated Debentures on December 22, 2017. The Debentures were due December 15, 2052 and were callable beginning December 15, 2017. The Company recorded a $4 million loss on redemption of debt to Realized gains (losses) on the Consolidated Statements of Operations for the removal of unamortized debt issuance cost. Credit Facility : On May 17, 2016, Torchmark amended its credit facility to include, as a part of the facility, the issuance of a $100 million term loan and to extend the maturity date of the entire credit facility to May 2021. The facility is further designated as a back-up credit line for a commercial paper program under which the Company may either borrow from the credit line or issue commercial paper at any time, with total commercial paper outstanding not to exceed the facility maximum of $750 million , less any letters of credit issued. Interest is charged at variable rates. The term loan will be repaid on a redemption schedule which provides for quarterly installments that began June 30, 2017 that escalate each annual period with a balloon payment of $75 million due in May 2021. Interest on the term loan is computed and paid monthly at 125 basis points plus 1 Month LIBOR. In accordance with the agreement, Torchmark is subject to certain covenants regarding capitalization. As of December 31, 2018 , the Company was in full compliance with these covenants. Commercial paper outstanding and any amortization payments of the term loan due within one year are reported as short-term debt on the Consolidated Balance Sheets . A table presenting selected information concerning Torchmark’s commercial paper borrowings is presented below. Credit Facility - Commercial Paper At December 31, 2018 2017 Balance at end of period (at par value) $ 302,100 $ 324,250 Annualized interest rate 2.93 % 1.78 % Letters of credit outstanding $ 155,000 $ 177,000 Remaining amount available under credit line $ 292,900 $ 248,750 Year Ended December 31, 2018 2017 2016 Average balance outstanding during period $ 368,228 $ 323,429 $ 301,550 Daily-weighted average interest rate (annualized) 2.40 % 1.30 % 0.83 % Maximum daily amount outstanding during period $ 525,990 $ 455,912 $ 412,676 |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Share Data: A summary of common share activity is presented in the following chart. Common Stock Issued Treasury Stock 2016: Balance at January 1, 2016 130,218,183 (7,848,231 ) Grants of restricted stock — 12,549 Vesting of performance shares — 159,020 Issuance of common stock due to exercise of stock options — 2,184,169 Treasury stock acquired — (6,694,582 ) Retirement of treasury stock (3,000,000 ) 3,000,000 Balance at December 31, 2016 127,218,183 (9,187,075 ) 2017: Grants of restricted stock — 9,135 Vesting of performance shares — 119,896 Issuance of common stock due to exercise of stock options — 1,661,808 Treasury stock acquired — (5,228,868 ) Retirement of treasury stock (3,000,000 ) 3,000,000 Balance at December 31, 2017 124,218,183 (9,625,104 ) 2018: Grants of restricted stock — 10,805 Forfeitures of restricted stock (7,500 ) Vesting of performance shares — 149,898 Issuance of common stock due to exercise of stock options — 897,622 Treasury stock acquired — (4,950,868 ) Retirement of treasury stock (3,000,000 ) 3,000,000 Balance at December 31, 2018 121,218,183 (10,525,147 ) There was no activity related to the preferred stock in years 2016 through 2018. Acquisition of Common Shares : Torchmark shares are acquired from time to time through open market purchases under the Torchmark stock repurchase program when it is believed to be the best use of Torchmark’s excess cash flows. When stock options are exercised, proceeds from the exercises are generally used to repurchase approximately the number of shares available with those funds in order to reduce dilution. See the following summary below: Torchmark Share Repurchase Program Share Repurchase for Dilution Purposes Shares Acquired Total Cost Average Price Shares Acquired Total Cost Average Price 2018 4,406 $ 371,794 $ 84.38 571 $ 49,955 $ 87.54 2017 4,126 324,622 78.67 1,103 88,367 80.15 2016 5,208 311,332 59.78 1,487 93,452 62.87 Restrictions : Restrictions exist on the flow of funds to Torchmark from its insurance subsidiaries. Statutory regulations require life insurance subsidiaries to maintain certain minimum amounts of capital and surplus. Dividends from insurance subsidiaries of Torchmark are restricted based on regulations by their states of domicile . Additionally, insurance company distributions are generally not permitted in excess of statutory surplus. Subsidiaries are also subject to certain minimum capital requirements. Subsidiaries of Torchmark paid cash dividends to the Parent Company in the amount of $448 million in 2018 , $454 million in 2017 , and $438 million in 2016 . As of December 31, 2018 , dividends and transfers from insurance subsidiaries to Parent available to be paid in 2019 are limited to the amount of $396 million without regulatory approval, such that $1.0 billion was considered restricted net assets of the subsidiaries. Dividends exceeding these limitations may be available during the year pending regulatory approval. While there are no legal restrictions on the payment of dividends to shareholders from Torchmark’s retained earnings, retained earnings as of December 31, 2018 were restricted by lenders’ covenants which require the Company to maintain and not distribute $3.8 billion from its total consolidated retained earnings of $5.2 billion . Earnings per Share : A reconciliation of basic and diluted weighted-average shares outstanding used in the computation of basic and diluted earnings per share is as follows: Year Ended December 31, 2018 2017 2016 Basic weighted average shares outstanding 112,872,581 116,342,529 120,001,191 Weighted average dilutive options outstanding 2,376,372 2,640,965 2,366,594 Diluted weighted average shares outstanding 115,248,953 118,983,494 122,367,785 Antidilutive shares 1,161,521 — — Antidilutive shares are excluded from the calculation of diluted earnings per share. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Torchmark’s stock-based compensation consists of stock options, restricted stock, restricted stock units, and performance shares. Certain employees and directors have been granted fixed equity options to buy shares of Torchmark stock at the market value of the stock on the date of grant, under the provisions of the Torchmark stock option plans. The options are exercisable during the period commencing from the date they vest until expiring according to the terms of the grant. Options generally expire the earlier of employee termination or option contract term, which are either seven -year or ten -year terms. Options generally vest in accordance with the following schedule: Shares vested by period Contract Period 6 Months Year 1 Year 2 Year 3 Year 4 Year 5 Directors 7 years 100% —% —% —% —% —% Employees 7 years —% —% 50% 50% —% —% Employees 10 years —% —% 25% 25% 25% 25% All employee options vest immediately upon retirement on or after the attainment of age 65, upon death, or disability. Torchmark generally issues shares for the exercise of stock options from treasury stock. The Company generally uses the proceeds from option exercises to buy shares of Torchmark common stock in the open market to reduce the dilution from option exercises. An analysis of shares available for grant is as follows: Available for Grant 2018 2017 2016 Balance at January 1, 2,964,320 5,088,461 6,872,282 Approval of Torchmark Corporation 2018 Incentive Plan (1) 8,984,000 — — Cancellation of available shares from prior plans (184,000 ) — — Options expired and forfeited during year (2) 41,317 26,488 8,518 Restricted stock expired and forfeited during year (3) — 46,500 — Options granted during year (2) (1,262,037 ) (1,328,513 ) (1,306,306 ) Restricted stock, restricted stock units, and performance shares granted under the Torchmark Corporation 2011 Incentive Plans (3) (1,120,840 ) (868,616 ) (486,033 ) Balance at December 31, 9,422,760 2,964,320 5,088,461 (1) See plan document referenced in Exhibits . (2) Plan allows for grant of options such that each grant reduces shares available for grant in a range from 0.85 share to 1 share. (3) Plan allows for grant of restricted stock such that each stock grant reduces shares available for grant in a range from 3.1 shares to 3.88 shares. A summary of stock compensation activity for each of the three years ended December 31, 2018 is presented below: 2018 2017 2016 Stock-based compensation expense recognized (1) $ 39,792 $ 37,034 $ 26,326 Tax benefit recognized 14,806 32,511 27,867 (1) No stock-based compensation expense was capitalized in any period. Additional stock compensation information is as follows at December 31: 2018 2017 Unrecognized compensation (1) $ 38,627 $ 31,309 Weighted average period of expected recognition (in years) (1) 0.81 0.86 (1) Includes restricted stock and performance shares. No equity awards were cash settled during the three years ended December 31, 2018 . Options: The following table summarizes information about stock options outstanding at December 31, 2018 . Options Outstanding Options Exercisable Range of Number Outstanding Weighted- Average Remaining Contractual Life (Years) Weighted- Average Exercise Price Number Exercisable Weighted- Average Exercise Price $29.59 - $37.40 909,471 1.57 $ 36.21 909,471 $ 36.21 50.64 1,308,101 5.38 50.64 467,288 50.64 50.69 - 51.62 920,372 2.66 50.70 859,552 50.70 53.61 - 56.32 1,251,337 3.60 53.66 1,117,163 53.66 73.92 - 77.26 1,439,081 6.19 77.24 10,843 74.29 83.17 - 90.21 1,375,403 7.31 87.62 28,773 88.44 $29.59 - $90.21 7,203,765 4.77 $ 61.72 3,393,090 $ 48.18 An analysis of option activity for each of the three years ended December 31, 2018 is as follows: 2018 2017 2016 Options Weighted Average Exercise Price Options Weighted Average Exercise Price Options Weighted Average Exercise Price Outstanding—beginning of year 6,753,801 $ 53.59 6,973,591 $ 44.64 7,734,841 $ 38.84 Granted: 7-year term 845,773 87.63 933,286 77.19 834,212 50.78 10-year term 543,130 87.60 535,220 77.26 597,225 50.64 Exercised (897,622 ) 40.21 (1,661,808 ) 36.84 (2,184,169 ) 28.08 Expired and forfeited (41,317 ) 70.90 (26,488 ) 57.94 (8,518 ) 39.35 Outstanding—end of year 7,203,765 $ 61.72 6,753,801 $ 53.59 6,973,591 $ 44.64 Exercisable at end of year 3,393,090 $ 48.18 2,928,979 $ 43.79 3,115,847 $ 36.81 Additional information about Torchmark’s stock option activity as of December 31, 2018 and 2017 is as follows: 2018 2017 Outstanding options: Weighted-average remaining contractual term (in years) 4.77 4.89 Aggregate intrinsic value $ 114,161 $ 231,277 Exercisable options: Weighted-average remaining contractual term (in years) 2.89 2.99 Aggregate intrinsic value $ 89,817 $ 137,424 Selected stock option activity for the three years ended December 31, 2018 is presented below: 2018 2017 2016 Weighted-average grant-date fair value of options granted $ 15.65 $ 12.88 $ 9.04 Intrinsic value of options exercised 42,517 70,948 73,995 Cash received from options exercised 36,091 61,215 61,329 Actual tax benefit received 8,929 24,832 25,898 Additional information concerning Torchmark’s unvested options is as follows at December 31: 2018 2017 Number of shares outstanding 3,810,675 3,824,822 Weighted-average exercise price (per share) $ 73.78 $ 61.10 Weighted-average remaining contractual term (in years) 6.45 6.34 Aggregate intrinsic value $ 24,344 $ 113,246 Torchmark expects that substantially all unvested options will vest. Restricted Stock: Restricted stock grants consist of time-vested grants, restricted stock units, and performance shares. Time-vested restricted stock is available to both senior executives and directors. The employee grants generally vest over five years and the director grants vest over six months. Restricted stock units are available only to directors. They vest over six months and are not converted to shares until the directors’ retirement, death, or disability. Director restricted stock and restricted stock units are generally granted on the first work day of the year. Performance shares are granted to a limited number of senior executives. Performance shares have a three -year contract life and are not settled in shares until the termination of the three -year contract period. While the grant specifies a stated target number of shares, the determination of the actual settlement in shares will be based on the achievement of certain performance objectives of Torchmark over the respective three -year contract periods. Certain executive restricted stock and performance share grants contain terms related to age that could accelerate vesting. Below are the following restricted stock units outstanding for each of the three years ended 2018 . All restricted stock units were fully vested at the end of each year of grant. Year of grants Outstanding as of year end 2016 112,591 2017 120,326 2018 102,116 Below is the final determination of the performance share grants in 2014 to 2016 : Year of grants Final settlement of shares Final settlement date 2014 119,896 February 21, 2017 2015 149,898 February 27, 2018 2016 311,399 February 28, 2019 For the 2017 and 2018 performance share grants, actual shares that could be distributed range from 0 to 306 thousand for the 2017 grants and 0 to 318 thousand shares for the 2018 grants. A summary of restricted stock grants for each of the years in the three-year period ended December 31, 2018 is presented in the table below. 2018 2017 2016 Directors restricted stock: Shares 10,805 9,135 12,549 Price per share $ 88.19 $ 73.92 $ 57.39 Aggregate value $ 953 $ 675 $ 720 Percent vested as of 12/31/18 100 % 100 % 85 % Directors restricted stock units (including dividend equivalents): Shares 7,688 7,735 6,912 Price per share $ 89.15 $ 74.45 $ 56.74 Aggregate value $ 685 $ 576 $ 392 Percent vested as of 12/31/18 100 % 100 % 100 % Performance shares: Target shares 159,000 153,000 167,500 Target price per share $ 87.60 $ 77.26 $ 50.64 Assumed adjustment for performance objectives (in shares) 179,415 106,084 (35,073 ) Aggregate value $ 13,928 $ 11,821 $ 8,482 Percent vested as of 12/31/18 — % — % — % Time-vested restricted stockholders, both employees and directors, are entitled to dividend payments on the unvested stock. Restricted stock unit holders are entitled to dividend equivalents. These equivalents are granted in the form of additional restricted stock units and vest immediately upon grant. Dividend equivalents are applicable only to restricted stock units. Performance shareholders are not entitled to dividend equivalents and are not entitled to dividend payments until the shares are vested and settled. An analysis of unvested restricted stock is as follows: Executive Executive Directors Directors Total 2016: Balance at January 1, 2016 187,665 459,017 — — 646,682 Grants — 167,500 12,549 6,912 186,961 Additional performance shares (1) — (35,073 ) — — (35,073 ) Restriction lapses (130,215 ) (159,020 ) (10,655 ) (6,912 ) (306,802 ) Forfeitures — — — — — Balance at December 31, 2016 57,450 432,424 1,894 — 491,768 2017: Grants — 153,000 9,135 7,735 169,870 Additional performance shares (1) — 106,084 — — 106,084 Restriction lapses (14,700 ) (119,896 ) (11,029 ) (7,735 ) (153,360 ) Forfeitures (7,500 ) (7,500 ) — — (15,000 ) Balance at December 31, 2017 35,250 564,112 — — 599,362 2018: Grants — 159,000 10,805 7,688 177,493 Additional performance shares (1) — 179,415 — — 179,415 Restriction lapses (23,250 ) (149,898 ) (10,805 ) (7,688 ) (191,641 ) Forfeitures — — — — — Balance at December 31, 2018 12,000 752,629 — — 764,629 (1) Estimated additional (reduced) share grants expected due to achievement of performance criteria. An analysis of the weighted-average grant-date fair values per share of unvested restricted stock is as follows for the year 2018 : Executive Restricted Stock Executive Performance Shares Directors Restricted Stock Directors Restricted Stock Units Grant-date fair value per share at January 1, 2018 $ 41.93 $ 56.64 $ — $ — Grants — 87.60 88.19 89.33 Estimated additional performance shares — 70.39 — — Restriction lapses (37.40 ) (53.61 ) (88.19 ) (89.33 ) Forfeitures — — — — Grant-date fair value per share at December 31, 2018 50.69 67.06 — — |
Business Segments
Business Segments | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Business Segments | Business Segments Torchmark is organized into four segments: life insurance, supplemental health insurance, annuities, and investments. We also have other administrative expenses reported in "Corporate & Other." Torchmark’s reportable segments are based on the insurance product lines it markets and administers: life insurance, supplemental health insurance, and annuities. These major product lines are set out as reportable segments because of the common characteristics of products within these categories, comparability of margins, and the similarity in regulatory environment and management techniques. There is also an investment segment which manages the investment portfolio, debt, and cash flow for the insurance segments and the corporate function. Torchmark's chief operating decision makers evaluate the overall performance of the operations of the Company in accordance with these segments. Life insurance products include traditional and interest-sensitive whole life insurance as well as term life insurance. Health insurance products are generally guaranteed-renewable and include Medicare Supplement, critical illness, accident, and limited-benefit supplemental hospital and surgical coverage. Annuities include fixed-benefit contracts. Torchmark markets its insurance products through a number of distribution channels, each of which sells the products of one or more of Torchmark’s insurance segments. The tables below present segment premium revenue by each of Torchmark’s distribution channels. Torchmark Corporation Premium Income by Distribution Channel For the Year 2018 Life Health Annuity Total Distribution Channel Amount % of Total Amount % of Total Amount % of Total Amount % of Total American Income Exclusive $ 1,081,333 45 $ 93,313 9 $ — — $ 1,174,646 34 Direct Response 828,935 34 76,297 7 — — 905,232 26 Liberty National Exclusive 278,878 12 191,378 19 — — 470,256 14 United American Independent 11,451 1 381,076 38 12 100 392,539 12 Family Heritage Exclusive 3,501 — 273,275 27 — — 276,776 8 Other 202,457 8 — — — — 202,457 6 $ 2,406,555 100 $ 1,015,339 100 $ 12 100 $ 3,421,906 100 For the Year 2017 Life Health Annuity Total Distribution Channel Amount % of Total Amount % of Total Amount % of Total Amount % of Total American Income Exclusive $ 999,279 43 $ 89,036 9 $ — — $ 1,088,315 33 Direct Response 812,907 35 73,468 8 — — 886,375 27 Liberty National Exclusive 274,635 12 196,207 20 — — 470,842 14 United American Independent 12,547 1 364,128 37 15 100 376,690 12 Family Heritage Exclusive 3,193 — 253,534 26 — — 256,727 8 Other 203,986 9 — — — — 203,986 6 $ 2,306,547 100 $ 976,373 100 $ 15 100 $ 3,282,935 100 For the Year 2016 Life Health Annuity Total Distribution Channel Amount % of Total Amount % of Total Amount % of Total Amount % of Total American Income Exclusive $ 913,355 42 $ 84,382 9 $ — — $ 997,737 32 Direct Response 782,765 36 70,393 7 — — 853,158 27 Liberty National Exclusive 270,476 12 201,798 21 — — 472,274 15 United American Independent 13,733 1 355,015 38 38 100 368,786 12 Family Heritage Exclusive 2,866 — 236,075 25 — — 238,941 8 Other 206,138 9 — — — — 206,138 6 $ 2,189,333 100 $ 947,663 100 $ 38 100 $ 3,137,034 100 Due to the nature of the life insurance industry, Torchmark has no individual or group which would be considered a major customer. Substantially all of Torchmark’s business is conducted in the United States. The measure of profitability established by the chief operating decision makers for insurance segments is underwriting margin before other income and administrative expenses, in accordance with the manner the segments are managed. It essentially represents gross profit margin on insurance products before insurance administrative expenses and consists primarily of premium less net policy benefits, acquisition expenses, and commissions. Required interest on net policy liabilities (benefit reserves less deferred acquisition costs) is reflected as a component of the Investment segment (rather than as a component of underwriting margin in the insurance and annuity segments) in order to match this cost with the investment income earned on the assets supporting the net policy liabilities. The measure of profitability for the Investment segment is excess investment income, which represents the income earned on the investment portfolio in excess of net policy requirements and financing costs associated with Torchmark’s debt. Other than the above-mentioned interest allocations and an intersegment commission, there are no other intersegment revenues or expenses. Expenses directly attributable to corporate operations are included in the “Corporate & Other” category. Stock-based compensation expense is considered a corporate expense by Torchmark management and is included in this category. All other unallocated revenues and expenses on a pretax basis, including insurance administrative expense, are also included in the “Corporate & Other” segment category. Torchmark holds a sizable investment portfolio to support its insurance liabilities, the yield from which is used to offset policy benefit, acquisition, administrative and tax expenses. This yield or investment income is taken into account when establishing premium rates and profitability expectations of its insurance products. In holding such a portfolio, investments are sold, called, or written down from time to time, resulting in a realized gain or loss. These gains or losses generally occur as a result of disposition due to issuer calls, compliance with Company investment policies, or other reasons often beyond management’s control. Unlike investment income, realized gains and losses are incidental to insurance operations, and only overall yields are considered when setting premium rates or insurance product profitability expectations. While these gains and losses are not relevant to segment profitability or core operating results, they can have a material positive or negative result on net income. For these reasons, management removes realized investment gains and losses when it views its segment operations. Management removes items that are related to prior periods when evaluating the operating results of current periods. Management also removes non-operating items unrelated to its core insurance activities when evaluating those results. Therefore, these items are excluded in its presentation of segment results, because accounting guidance requires that operating segment results be presented as management views its business. With the exception of the administrative settlements noted in the paragraphs above, all of these items are included in “Other operating expense” in the Consolidated Statements of Operations for the appropriate year. See additional detail below in the tables. The following tables set forth a reconciliation of Torchmark’s revenues and operations by segment to its major income statement line items. See Note 1—Significant Accounting Policies for additional information concerning reconciling items of segment profits to pretax income. For the year 2018 Life Health Annuity Investment Corporate & Other Adjustments Consolidated Revenue: Premium $ 2,406,555 $ 1,015,339 $ 12 $ — $ — $ — $ 3,421,906 Net investment income — — — 882,512 — — 882,512 Other income — — — — 1,236 (99 ) (2) 1,137 Total revenue 2,406,555 1,015,339 12 882,512 1,236 (99 ) 4,305,555 Expenses: Policy benefits 1,591,790 649,188 34,264 — — — 2,275,242 Required interest on reserves (636,040 ) (83,243 ) (47,357 ) 766,640 — — — Required interest on deferred acquisition costs 194,297 24,412 589 (219,298 ) — — — Amortization of acquisition costs 414,200 100,376 2,114 — — — 516,690 Commissions, premium taxes, and non-deferred acquisition costs 190,007 88,553 26 — — (99 ) (2) 278,487 Insurance administrative expense (1) — — — — 223,941 3,590 (3) 227,531 Parent expense — — — — 10,684 1,578 (4) 12,262 Stock-based compensation expense — — — — 39,792 — 39,792 Interest expense — — — 90,076 — — 90,076 Total expenses 1,754,254 779,286 (10,364 ) 637,418 274,417 5,069 3,440,080 Subtotal 652,301 236,053 10,376 245,094 (273,181 ) (5,168 ) 865,475 Non-operating items — — — — — 5,168 (3,4) 5,168 Measure of segment profitability (pretax) $ 652,301 $ 236,053 $ 10,376 $ 245,094 $ (273,181 ) $ — 870,643 Realized gain (loss)—investments 9,274 Realized loss — redemption of debt (11,078 ) Administrative settlements (3,590 ) Non-operating fees (1,578 ) Income before income taxes per Consolidated Statement of Operations $ 863,671 (1) Administrative expense is not allocated to insurance segments. (2) Elimination of intersegment commission. (3) In 2018 , the Company recorded $3.6 million in administrative settlements related to state regulatory examinations. These administrative settlements were included in "Policyholder benefits" in the Consolidated Statements of Operations . (4) Non-operating fees. For the year 2017 Life Health Annuity Investment Corporate & Other Adjustments Consolidated Revenue: Premium $ 2,306,547 $ 976,373 $ 15 $ — $ — $ — $ 3,282,935 Net investment income — — — 847,885 — — 847,885 Other income — — — — 1,270 (128 ) (2) 1,142 Total revenue 2,306,547 976,373 15 847,885 1,270 (128 ) 4,131,962 Expenses: Policy benefits 1,549,602 628,640 35,836 — — 13,797 (3,4) 2,227,875 Required interest on reserves (607,007 ) (77,792 ) (49,571 ) 734,370 — — — Required interest on deferred acquisition costs 186,236 23,454 690 (210,380 ) — — — Amortization of acquisition costs 396,268 96,519 2,466 — — (4,850 ) (4) 490,403 Commissions, premium taxes, and non-deferred acquisition costs 177,111 86,044 32 — — 1,673 (2,5) 264,860 Insurance administrative expense (1) — — — — 210,590 — 210,590 Parent expense — — — — 9,631 — 9,631 Stock-based compensation expense — — — — 33,654 3,380 (6) 37,034 Interest expense — — — 84,532 — — 84,532 Total expenses 1,702,210 756,865 (10,547 ) 608,522 253,875 14,000 3,324,925 Subtotal 604,337 219,508 10,562 239,363 (252,605 ) (14,128 ) 807,037 Non-operating items — — — — — 14,128 (3,4,5,6) 14,128 Measure of segment profitability (pretax) $ 604,337 $ 219,508 $ 10,562 $ 239,363 $ (252,605 ) $ — 821,165 Realized gain (loss)—investments 27,652 Realized loss — redemption of debt (4,041 ) Administrative settlements (8,659 ) Non-operating fees (288 ) Guaranty fund assessments (1,801 ) Stock-based compensation expense—Tax reform adjustment (3,380 ) Income before income taxes per Consolidated Statement of Operations 830,648 (1) Administrative expense is not allocated to insurance segments. (2) Elimination of intersegment commission. (3) In 2017 , the Company recorded $8.7 million ( $5.6 million , net of tax) in administrative settlements where claims were not properly filed or information to support the validity of the claim had not been properly submitted. These administrative settlements were included in "Policyholder benefits" in the Consolidated Statements of Operations . (4) Non-operating fees. (5) In 2017 , the Company recorded $1.8 million ( $1.2 million , net of tax) in unrecoverable guaranty fund assessments. See Note 6—Commitment and Contingencies for further discussion. (6) The Company increased stock-based compensation expense by $3.4 million ( $2.2 million , net of tax) due to the impact of the tax rate change on certain performance-based equity awards. For the Year 2016 Life Health Annuity Investment Corporate & Other Adjustments Consolidated Revenue: Premium $ 2,189,333 $ 947,663 $ 38 $ — $ — $ — $ 3,137,034 Net investment income — — — 806,903 — — 806,903 Other income — — — — 1,534 (159 ) (2) 1,375 Total revenue 2,189,333 947,663 38 806,903 1,534 (159 ) 3,945,312 Expenses: Policy benefits 1,475,477 612,725 36,751 — — 3,795 (3) 2,128,748 Required interest on reserves (577,827 ) (73,382 ) (51,131 ) 702,340 — — — Required interest on deferred acquisition costs 178,946 23,060 807 (202,813 ) — — — Amortization of acquisition costs 374,499 90,385 4,179 — — — 469,063 Commissions, premium taxes, and non-deferred acquisition costs 164,476 84,819 38 — — (159 ) (2) 249,174 Insurance administrative expense (1) — — — — 196,598 553 (4) 197,151 Parent expense — — — — 8,587 — 8,587 Stock-based compensation expense — — — — 26,326 — 26,326 Interest expense — — — 83,345 — — 83,345 Total expenses 1,615,571 737,607 (9,356 ) 582,872 231,511 4,189 3,162,394 Subtotal 573,762 210,056 9,394 224,031 (229,977 ) (4,348 ) 782,918 Non-operating items — — — — — 4,348 '(3,4) 4,348 Measure of segment profitability (pretax) $ 573,762 $ 210,056 $ 9,394 $ 224,031 $ (229,977 ) $ — 787,266 Realized gain (loss)—investments (10,683 ) Administrative settlements (3,795 ) Non-operating fees (553 ) Income before income taxes per Consolidated Statement of Operations $ 772,235 (1) Administrative expense is not allocated to insurance segments. (2) Elimination of intersegment commission. (3) In 2016 , the Company recorded $3.8 million in administrative settlements related to benefits paid for deaths occurring in prior years where claims had not been filed. These administrative settlements were included in "Policyholder benefits" in the Consolidated Statements of Operations . (4) Non-operating fees. Assets for each segment are reported based on a specific identification basis. The insurance segments’ assets contain DAC. The investment segment includes the investment portfolio, cash, and accrued investment income. Goodwill is assigned to the insurance segments at the time of purchase. All other assets are included in the Other category. The table below reconciles segment assets to total assets as reported in the consolidated financial statements. Assets by Segment At December 31, 2018 Life Health Annuity Investment Other Consolidated Cash and invested assets $ — $ — $ — $ 17,239,570 $ — $ 17,239,570 Accrued investment income — — — 243,003 — 243,003 Deferred acquisition costs 3,580,693 548,640 8,592 — — 4,137,925 Goodwill 309,609 131,982 — — — 441,591 Other assets — — — — 1,033,633 1,033,633 Total assets $ 3,890,302 $ 680,622 $ 8,592 $ 17,482,573 $ 1,033,633 $ 23,095,722 At December 31, 2017 Life Health Annuity Investment Other Consolidated Cash and invested assets $ — $ — $ — $ 17,853,047 $ — $ 17,853,047 Accrued investment income — — — 233,453 — 233,453 Deferred acquisition costs 3,423,296 529,068 5,699 — — 3,958,063 Goodwill 309,609 131,982 — — — 441,591 Other assets — — — — 988,831 988,831 Total assets $ 3,732,905 $ 661,050 $ 5,699 $ 18,086,500 $ 988,831 $ 23,474,985 Liabilities for each segment are reported also on a specific identification basis similar to the assets. The insurance segments' liabilities contain future policy benefits, unearned and advance premiums, and policy claims and other benefits payable. Other policyholders' funds are included in Other as well as current and deferred income taxes payable. Debt represents both short and long-term. Liabilities by Segment At December 31, 2018 Life Health Annuity Investment Other Consolidated Future policy benefits $ 10,847,356 $ 1,927,732 $ 1,178,738 $ — $ — $ 13,953,826 Unearned and advance premiums 17,850 43,358 — — — 61,208 Policy claims and other benefits payable 196,298 154,528 — — — 350,826 Debt — — — 1,665,033 — 1,665,033 Other — — — — 1,649,652 1,649,652 Total liabilities $ 11,061,504 $ 2,125,618 $ 1,178,738 $ 1,665,033 $ 1,649,652 $ 17,680,545 At December 31, 2017 Life Health Annuity Investment Other Consolidated Future policy benefits $ 10,353,286 $ 1,831,338 $ 1,254,848 $ — $ — $ 13,439,472 Unearned and advance premiums 16,927 44,503 — — — 61,430 Policy claims and other benefits payable 186,429 146,865 — — — 333,294 Debt — — — 1,460,268 — 1,460,268 Other — — — — 1,949,100 1,949,100 Total liabilities $ 10,556,642 $ 2,022,706 $ 1,254,848 $ 1,460,268 $ 1,949,100 $ 17,243,564 |
Selected Quarterly Data (Unaudi
Selected Quarterly Data (Unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Data (Unaudited) | Selected Quarterly Data (Unaudited) The following is an unaudited summary of quarterly results for the two years ended December 31, 2018 . The information includes all adjustments (consisting of normal accruals) which management considers necessary for a fair presentation of the results of operations for these periods. Three Months Ended March 31, June 30, September 30, December 31, 2018: Premium income $ 850,106 $ 853,979 $ 860,750 $ 857,071 Net investment income 218,084 218,568 221,627 224,233 Realized gains (losses) 1,951 11,813 1,032 (16,600 ) Total revenue 1,070,436 1,084,776 1,083,802 1,064,737 Policyholder benefits 569,889 568,377 567,856 569,120 Amortization of deferred acquisition costs 129,620 129,077 129,492 128,501 Pretax income from continuing operations 212,842 226,864 220,330 203,635 Income from continuing operations 173,711 184,393 178,700 164,706 Income (loss) from discontinued operations (111 ) 32 24 11 Net income 173,600 184,425 178,724 164,717 Basic net income per common share: Continuing operations 1.52 1.63 1.59 1.48 Discontinued operations — — — — Total basic net income per common share 1.52 1.63 1.59 1.48 Diluted net income per common share: Continuing operations 1.49 1.59 1.55 1.45 Discontinued operations — — — — Total diluted net income per common share 1.49 1.59 1.55 1.45 Three Months Ended March 31, June 30, September 30, December 31, 2017: Premium income $ 820,631 $ 816,614 $ 819,217 $ 826,473 Net investment income 208,282 212,776 213,872 212,955 Realized gains (losses) (5,748 ) (705 ) 12,595 17,469 Total revenue 1,023,581 1,029,078 1,046,015 1,056,899 Policyholder benefits 557,776 556,415 551,219 562,465 Amortization of deferred acquisition costs 125,908 122,121 122,334 120,040 Pretax income from continuing operations 191,741 201,926 220,610 216,371 Income from continuing operations 137,178 140,363 153,346 1,027,376 Income from discontinued operations (3,637 ) (90 ) (12 ) (30 ) Net income 133,541 140,273 153,334 1,027,346 Basic net income per common share: Continuing operations 1.16 1.20 1.32 8.93 Discontinued operations (0.03 ) — — — Total basic net income per common share 1.13 1.20 1.32 8.93 Diluted net income per common share: Continuing operations 1.14 1.18 1.29 8.71 Discontinued operations (0.03 ) — — — Total diluted net income per common share 1.11 1.18 1.29 8.71 |
Schedule II. Condensed Financia
Schedule II. Condensed Financial Information of Registrant | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule II. Condensed Financial Information of Registrant | TORCHMARK CORPORATION (PARENT COMPANY) SCHEDULE II. CONDENSED FINANCIAL INFORMATION OF REGISTRANT Condensed Balance Sheets (Dollar amounts in thousands) December 31, 2018 2017 Assets: Investments: Long-term investments $ 29,603 $ 35,562 Short-term investments 21 5,624 Total investments 29,624 41,186 Cash 760 1,008 Investment in affiliates 7,128,588 7,763,704 Due from affiliates 96,110 95,920 Taxes receivable from affiliates 50,656 63,099 Other assets 152,103 135,616 Total assets $ 7,457,841 $ 8,100,533 Liabilities and shareholders’ equity: Liabilities: Short-term debt $ 307,848 $ 328,067 Long-term debt 1,507,000 1,281,971 Due to affiliates 3,002 8,002 Other liabilities 224,814 251,072 Total liabilities 2,042,664 1,869,112 Shareholders’ equity: Preferred stock 351 351 Common stock 121,218 124,218 Additional paid-in capital 874,925 858,987 Accumulated other comprehensive income 319,475 1,424,274 Retained earnings 5,213,468 4,806,208 Treasury stock (1,114,260 ) (982,617 ) Total shareholders’ equity 5,415,177 6,231,421 Total liabilities and shareholders’ equity $ 7,457,841 $ 8,100,533 See Notes to Condensed Financial Statements and accompanying Report of Independent Registered Public Accounting Firm. TORCHMARK CORPORATION (PARENT COMPANY) SCHEDULE II. CONDENSED FINANCIAL INFORMATION OF REGISTRANT (continued) Condensed Statement of Operations (Dollar amounts in thousands) Year Ended December 31, 2018 2017 2016 Net investment income $ 28,077 $ 26,130 $ 25,352 Realized investment gains (losses) (11,078 ) (2,791 ) — Total revenue 16,999 23,339 25,352 General operating expenses 65,762 61,447 52,613 Reimbursements from affiliates (61,620 ) (52,776 ) (54,288 ) Interest expense 94,159 88,474 86,853 Total expenses 98,301 97,145 85,178 Operating income (loss) before income taxes and equity in earnings of affiliates (81,302 ) (73,806 ) (59,826 ) Income taxes 15,262 (9,874 ) 23,479 Net operating loss before equity in earnings of affiliates (66,040 ) (83,680 ) (36,347 ) Equity in earnings of affiliates, net of tax 767,506 1,538,174 586,126 Net income 701,466 1,454,494 549,779 Other comprehensive income (loss): Attributable to Parent Company 23,805 (8,409 ) (11,314 ) Attributable to affiliates (1,128,604 ) 602,709 356,941 Comprehensive income (loss) $ (403,333 ) $ 2,048,794 $ 895,406 See Notes to Condensed Financial Statements and accompanying Report of Independent Registered Public Accounting Firm. TORCHMARK CORPORATION (PARENT COMPANY) SCHEDULE II. CONDENSED FINANCIAL INFORMATION OF REGISTRANT—(continued) Condensed Statement of Cash Flows (Dollar amounts in thousands) Year Ended December 31, 2018 2017 2016 Net income $ 701,466 $ 1,454,494 $ 549,779 Equity in earnings of affiliates (767,506 ) (1,538,174 ) (586,126 ) Cash dividends from subsidiaries 448,142 453,904 437,566 Other, net 64,734 52,957 (6,718 ) Cash provided from operations 446,836 423,181 394,501 Cash provided from (used for) investing activities: Net decrease (increase) in short-term investments 5,603 (5,624 ) (3,466 ) Investment in subsidiaries (140,000 ) (31,000 ) (35,000 ) Additions to properties (19,888 ) (7,230 ) (21,965 ) Loaned money to affiliates (584,000 ) (180,000 ) (363,056 ) Repayments from affiliates 584,000 180,000 318,056 Cash provided from (used for) investing activities (154,285 ) (43,854 ) (105,431 ) Cash provided from (used for) financing activities: Repayment of debt (327,762 ) (126,875 ) (250,000 ) Proceeds from issuance of debt 550,000 125,000 400,000 Payment for debt issuance costs (6,969 ) (1,661 ) (9,638 ) Net issuance (repayment) of commercial paper (22,719 ) 61,092 22,224 Issuance of stock 36,091 61,215 61,329 Acquisitions of treasury stock (421,749 ) (412,989 ) (404,784 ) Borrowed money from affiliate 197,690 278,500 60,000 Repayments to affiliates (202,690 ) (270,500 ) (78,000 ) Payment of dividends (94,691 ) (92,101 ) (90,201 ) Cash provided from (used for) financing activities (292,799 ) (378,319 ) (289,070 ) Net increase (decrease) in cash (248 ) 1,008 — Cash balance at beginning of period 1,008 — — Cash balance at end of period $ 760 $ 1,008 $ — See Notes to Condensed Financial Statements and accompanying Report of Independent Registered Public Accounting Firm. TORCHMARK CORPORATION (PARENT COMPANY) SCHEDULE II. CONDENSED FINANCIAL INFORMATION OF REGISTRANT (continued) Notes to Condensed Financial Statements (Dollar amounts in thousands) Note A—Dividends from Subsidiaries Cash dividends paid to Torchmark from the subsidiaries were as follows: Year Ended December 31, 2018 2017 2016 Dividends from subsidiaries $ 448,142 $ 453,904 $ 437,566 Note B—Supplemental Disclosures of Cash Flow Information The following table summarizes noncash transactions, which are not reflected on the Condensed Statements of Cash Flows : Year Ended December 31, 2018 2017 2016 Stock-based compensation not involving cash $ 39,792 $ 37,034 $ 26,326 Investment in subsidiaries 11,889 317,027 — Dividend of property to Parent 11,889 — — The following table summarizes certain amounts paid (received) during the period: Year Ended December 31, 2018 2017 2016 Interest paid $ 86,982 $ 86,606 $ 84,952 Income taxes paid (received) (21,377 ) (19,961 ) (20,838 ) Note C—Preferred Stock As of December 31, 2018 , Torchmark had 351 thousand shares of Cumulative Preferred Stock, Series A, issued and outstanding, of which 280 thousand shares were 6.50% Cumulative Preferred Stock, Series A, and 71 thousand shares were 7.15% Cumulative Preferred Stock, Series A (collectively, the “Series A Preferred Stock”). All issued and outstanding shares of Series A Preferred Stock were held by wholly-owned insurance subsidiaries. In the event of liquidation, the holders of the Series A Preferred Stock at the time outstanding would be entitled to receive a liquidating distribution out of the assets legally available to stockholders in the amount of $1 thousand per share or $351 million in the aggregate, plus any accrued and unpaid dividends, before any distribution is made to holders of Torchmark common stock. Holders of Series A Preferred Stock do not have any voting rights nor have rights to convert such shares into shares of any other class of Torchmark capital stock. See accompanying Report of Independent Registered Public Accounting Firm. |
Schedule IV. Reinsurance
Schedule IV. Reinsurance | 12 Months Ended |
Dec. 31, 2018 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | |
Schedule IV. Reinsurance | TORCHMARK CORPORATION SCHEDULE IV. REINSURANCE (CONSOLIDATED) (Dollar Amounts in thousands) Gross Ceded (1) Assumed Net Percentage For the Year Ended December 31, 2018 Life insurance in force $ 185,212,195 $ 688,384 $ 3,019,737 $ 187,543,548 1.6 Premiums (2) : Life insurance $ 2,373,423 $ 4,581 $ 21,305 $ 2,390,147 0.9 Health insurance 1,019,007 3,668 — 1,015,339 — Total premium $ 3,392,430 $ 8,249 $ 21,305 $ 3,405,486 0.6 For the Year Ended December 31, 2017 Life insurance in force $ 179,902,605 $ 705,152 $ 3,211,423 $ 182,408,876 1.8 Premiums (2) : Life insurance $ 2,272,038 $ 4,437 $ 21,912 $ 2,289,513 1.0 Health insurance 980,082 3,709 — 976,373 — Total premium $ 3,252,120 $ 8,146 $ 21,912 $ 3,265,886 0.7 For the Year Ended December 31, 2016 Life insurance in force $ 174,314,897 $ 725,867 $ 3,352,113 $ 176,941,143 1.9 Premiums (2) : Life insurance $ 2,152,698 $ 4,507 $ 22,915 $ 2,171,106 1.1 Health insurance 951,137 3,474 — 947,663 — Total premium $ 3,103,835 $ 7,981 $ 22,915 $ 3,118,769 0.7 (1) No amounts have been netted against ceded premium. (2) Excludes policy charges of $16.4 million , $17.0 million , and $18.3 million in each of the years 2018 , 2017 , and 2016 , respectively. See accompanying Report of Independent Registered Public Accounting Firm. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Significant Accounting Policies [Line Items] | |
Basis of Presentation | Basis of Presentation : The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), under guidance issued by the Financial Accounting Standards Board (FASB). The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Principles of Consolidation | Principles of Consolidation : The consolidated financial statements include the results of Torchmark and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. When Torchmark acquires a subsidiary or a block of business, the assets acquired and the liabilities assumed are measured at fair value at the acquisition date. Any excess of acquisition cost over the fair value of net assets is recorded as goodwill. Expenses incurred to effect the acquisition are charged to earnings as of the acquisition date. Upon acquisition, the accounts and results of operations are consolidated as of and subsequent to the acquisition date. Torchmark accounts for its variable interest entities (VIEs) under accounting guidance which clarifies the definition of a variable interest and the instructions for consolidating VIEs. Only primary beneficiaries are required or allowed to consolidate VIEs. Therefore, a company may have voting control of a VIE, but if it is not the primary beneficiary, it is not permitted to consolidate the VIE. As further described under the caption Low-Income Housing Tax Credit Interests below in this note, Torchmark holds passive interests in limited partnerships which provide investment returns through the provision of tax benefits (principally from the transfer of federal or state tax credits related to federal low-income housing). These interests are considered to be VIEs. They are not consolidated because the Company has no power to control the activities that most significantly affect the economic performance of these entities and therefore the Company is not the primary beneficiary of any of these interests. Torchmark’s involvement is limited to its limited partnership interest in the entities. Torchmark has not provided any other financial support to the entities beyond its commitments to fund its limited partnership interests, and there are no arrangements or agreements with any of the interests to provide other financial support. The maximum loss exposure relative to these interests is limited to their carrying value. |
Investments | Investments : Torchmark classifies all of its fixed maturity investments as available for sale. Investments classified as available for sale are carried at fair value with unrealized gains and losses, net of deferred taxes, reflected directly in accumulated other comprehensive income. Policy loans are carried at unpaid principal balances. Other long-term investments include equity securities, real estate, commercial mortgage loan participations, and limited partnerships. Investments in equity securities are reported at fair value with changes in fair value, net of deferred taxes, reflected directly in " Realized Gains (Losses)" in the Consolidated Statements of Operations . Investments in real estate are reported at cost less allowances for depreciation. Depreciation is calculated on the straight-line method. Investments in certain limited partnerships are accounted for using the fair value option and fluctuations in fair value are reported in " Realized Gains (Losses) ." Short-term investments include investments in interest-bearing assets with original maturities of twelve months or less. Gains and losses realized on the disposition of investments are determined on a specific identification basis. Commercial mortgage loan participations, a type of investment where the mortgage loan is shared among investors, are accounted for as financing receivables. The commercial mortgage loan participations are managed by a third party. The Company purchased the legal rights to interests in commercial mortgage loans which are secured by properties such as hotels, retail, multiple family, or offices. The commercial mortgage loans typically have a term of three years with the option to extend up to two years. The commercial mortgages loans are recorded at unpaid principal balance, net of unamortized origination fees and net of allowance for loan losses, if applicable. Interest income, net of the amortization of origination fees, is recorded in "Net Investment Income" under the effective yield method. The Company evaluates the performance and credit quality of each individual commercial mortgage on a quarterly basis, or as needed, by utilizing common metrics such as loan-to-value and debt service coverage ratios as well as evaluating the fair value of the underlying collateral. The fair value of the underlying collateral is based on a third party appraisal of the property. The Company will also determine the probability of estimated losses for each commercial mortgage loan and record an allowance if conclusions are reached that collection of principal and interest are not probable. The allowance for loan losses are based on estimates, historical experience, probability of loss, value of the underlying collateral, and macro factors that affect the collectability of the loan. All assumptions are reviewed and updated as necessary. |
Impairment of Investments | Impairment of Investments : Torchmark’s portfolio of fixed maturities fluctuates in value due to changes in interest rates in the financial markets as well as other factors. Fluctuations caused by market interest rate changes have little bearing on whether or not the investment will be ultimately recoverable. Therefore, Torchmark considers these declines in value resulting from changes in market interest rates to be temporary. In certain circumstances, however, Torchmark determines that the decline in the value of a security is other-than-temporary and writes the book value of the security down to its fair value, realizing an investment loss. The evaluation of Torchmark’s securities for other-than-temporary impairments is a process that is undertaken at least quarterly and is overseen by a team of investment and accounting professionals. Each security, which is impaired because the fair value is less than the cost or amortized cost, is identified and evaluated. The determination that an impairment is other-than-temporary is highly subjective and involves the careful consideration of many factors. Among the factors considered are: • The length of time and extent to which the security has been impaired • The reason(s) for the impairment • The financial condition of the issuer and the prospects for recovery in fair value of the security • The Company’s ability and intent to hold the security until anticipated recovery • Expected future cash flows The relative weight given to each of these factors can change over time as facts and circumstances change. In many cases, management believes it is appropriate to give relatively more weight to prospective factors than to retrospective factors. Prospective factors that are given more weight include prospects for recovery, the Company’s ability and intent to hold the security until anticipated recovery, and expected future cash flows. Among the facts and information considered in the process are: • Financial statements of the issuer • Changes in credit ratings of the issuer • The value of underlying collateral • News and information included in press releases issued by the issuer • News and information reported in the media concerning the issuer • News and information published by or otherwise provided by securities, economic, or research analysts • The nature and amount of recent and expected future sources and uses of cash • Default on a required payment • Issuer bankruptcy filings While all available information is taken into account, it is difficult to predict the ultimate recoverable amount of a distressed or impaired security. If a security is determined to be other-than-temporarily impaired, the cost basis of the security is written down to fair value and is treated as a realized loss in the period the determination is made. The written-down security will be amortized and revenue recognized in accordance with estimated future cash flows. Current accounting guidance is such that if an entity intends to sell or if it is more likely than not that it will be required to sell an impaired security prior to recovery of its cost basis, the security is to be considered other-than-temporarily impaired and the full amount of impairment must be charged to earnings. Otherwise, losses on fixed maturities which are other-than-temporarily impaired are separated into two categories, the portion of loss which is considered credit loss and the portion of loss which is due to other factors. The credit loss portion is charged to earnings while the loss due to other factors is charged to other comprehensive income. The credit loss portion of an impairment is determined as the difference between the security’s amortized cost and the present value of expected future cash flows discounted at the security’s original effective yield rate. The temporary portion is the difference between this present value of expected future cash flows and fair value (as discounted by a market yield). The expected cash flows are determined using judgment and the best information available to the Company. Inputs used to derive expected cash flows include expected default rates, current levels of subordination, and loan-to-collateral value ratios. |
Cash | Cash : Cash consists of balances on hand and on deposit in banks and financial institutions. |
Accrued Investment Income and Other Receivables | Accrued investment income : Accrued investment income consists of interest income or dividends earned on the investment portfolio, but are yet to be received as of the balance sheet date. The Company will write-off accrued investment income that is deemed to be uncollectible. Other Receivables : Other receivables consist mostly of agent debit balances that primarily represent commissions advanced to insurance agents. These balances are repaid to the Company over time as the premiums associated with the advanced commissions are collected by the Company and the agents' commissions on such premiums are retained. |
Deferred Acquisition Costs | Deferred Acquisition Costs : Certain costs of acquiring new insurance business are deferred and recorded as an asset. These costs are essential for the acquisition of new insurance business and are directly related to the successful issuance of an insurance contract including sales commissions, policy issue costs, and underwriting costs. Additionally, deferred acquisition costs (DAC) include the value of business acquired (VOBA), which are the costs of acquiring blocks of insurance from other companies or through the acquisition of other companies. These costs represent the difference between the fair value of the contractual insurance assets acquired and liabilities assumed compared against the assets and liabilities for insurance contracts that the Company issues or holds measured in accordance with GAAP. DAC and VOBA are amortized in a systematic manner which matches these costs with the associated revenues. Policies other than universal life-type policies are amortized with interest over the estimated premium-paying period of the policies in a manner which charges each year’s operations in proportion to the receipt of premium income. Universal life-type policies are amortized with interest in proportion to estimated gross profits. The assumptions used to amortize acquisition costs include interest, mortality, morbidity, and persistency, and are consistent with those used to estimate the liability for future policy benefits. For interest-sensitive and deposit-balance type products, these assumptions are reviewed on a regular basis and are revised if actual experience differs significantly from original expectations. For all other products, amortization assumptions are generally not revised once established. DAC and VOBA are subject to periodic recoverability and loss recognition testing to determine if there is a premium deficiency. These tests evaluate whether the present value of future contract-related cash flows will support the capitalized DAC and VOBA assets. These cash flows consist primarily of premium income, less benefits and expenses taking inflation into account. The present value of these cash flows, less the benefit reserve, is then compared with the unamortized deferred acquisition cost balance. In the event the estimated present value of net cash flows is less, the deficiency would be recognized by a charge to earnings and either a reduction of unamortized acquisition costs or an increase in the liability for future benefits, as described under the caption Future Policy Benefits . |
Advertising Costs | Advertising Costs : Costs related to advertising are generally charged to expense as incurred. However, certain Globe Life Direct Response advertising costs are capitalized when there is a reliable and demonstrated relationship between total costs and future benefits that is a direct result of incurring these costs. Globe Life Direct Response advertising costs consist primarily of the production and distribution costs of direct mail advertising materials, and when capitalized are included as a component of DAC. They are amortized in the same manner as other DAC. |
Goodwill | Goodwill : The excess cost of a business acquired over the fair value of net assets acquired is reported as goodwill. Goodwill is subject to impairment testing in accordance with GAAP on an annual basis, or whenever potential impairment triggers occur. The Company may perform a qualitative analysis under certain circumstances, or perform a two-step quantitative analysis. In the qualitative analysis, the Company determines if it is more likely than not that the fair value of a reporting unit is less than its carrying amount by assessing current events and circumstances. If there are factors present indicating potential impairment, the Company would proceed to the two-step quantitative analysis. In the two-step quantitative analysis, the Company utilizes two approaches, income and market, to determine the fair value of each reporting unit. In the income approach, judgment and assumptions are used in developing the projected cash flows for the reporting units, and such estimates are subject to change. The Company also exercises judgment in the determination of the discount rate as management believes this to be appropriate for the risk associated with the cash flow expectations. In the market approach, the Company utilizes the share price and a control premium based on businesses with similar assets to determine a fair value. In both cases, the fair value of each reporting unit is then measured against that reporting unit’s corresponding carrying value. In the event the fair value is less than the carrying value, further testing is required under the accounting guidance to determine the amount of impairment, if any. If there is an impairment in the goodwill of any reporting unit, it is written down and charged to earnings in the period of the test. |
Low-Income Housing Tax Credit Interests | Low-Income Housing Tax Credit Interests : Torchmark invests in limited partnerships that provide low-income housing tax credits and other related federal income tax benefits to Torchmark. The carrying value of Torchmark’s investment in these entities was $226 million and $228 million at December 31, 2018 and 2017 , respectively and was included in "Other assets" on the Consolidated Balance Sheets. As of December 31, 2018 , Torchmark was obligated under future commitments of $51 million , which are recorded in "Other liabilities". For guaranteed investments acquired prior to January 1, 2015, the Company utilizes the effective-yield method of amortization, while the proportional method of amortization is utilized for all non-guaranteed and guaranteed investments acquired on or after January 1, 2015. All amortization expense is recorded in "Income tax benefit (expense)" on the Consolidated Statements of Operations . |
Property and Equipment | Property and Equipment : Property and equipment, included in “Other assets,” is reported at cost less allowances for depreciation. Depreciation is recorded primarily on the straight line method over the estimated useful lives of these assets which range from three to five years for equipment and ten to forty years for buildings and improvements. Ordinary maintenance and repairs are charged to income as incurred. Impairments, if any, are recorded when certain events and circumstances become evident that the fair value of the asset is less than its carrying amount. |
Future Policy Benefits | Future Policy Benefits : The liability for future policy benefits for annuity and universal life-type products is represented by policy account value. The liability for future policy benefits for all other life and health products, approximately 88% of total liabilities for future policy benefits, is determined on the net level premium method. This method provides for the present value of expected future benefit payments less the present value of expected future net premiums, based on estimated investment yields, mortality, morbidity, persistency, and other assumptions which were considered appropriate at the time the policies were issued. For limited-payment contracts, a deferred profit liability is also recorded which causes profits to emerge over the life of the contract in proportion to policies in force. Assumptions used for traditional life and health insurance products are based primarily on Company experience. Assumptions for interest rates range from 2.5% to 7.0% for Torchmark’s insurance companies with an overall weighted average assumed rate of 5.7% . Mortality tables used for individual life insurance include various statutory tables and modifications of a variety of generally accepted actuarial tables. Morbidity assumptions for individual health are based on Company experience and industry data. Withdrawal and termination assumptions are based on Torchmark’s experience. Once established, assumptions for these products are generally not changed. An additional provision is made on most products to allow for possible adverse deviation from the assumptions. These estimates are reviewed annually and compared with actual experience. If it is determined that existing contract liabilities, together with the present value of future gross premiums, will not be sufficient to cover the present value of future benefits and to recover unamortized deferred acquisition costs, then a premium deficiency exists. Such a deficiency would be recognized immediately by a charge to earnings and either a reduction of unamortized deferred acquisition costs or an increase in the liability for future policy benefits. From that point forward, the liability for future policy benefits would be based on revised assumptions. |
Policy Claims and Other Benefits Payable | Policy Claims and Other Benefits Payable : Torchmark establishes a liability for known policy benefits payable and an estimate of claims that have been incurred but not yet reported to the Company. Torchmark makes an estimate of unreported claims after careful evaluation of all information available to the Company. This estimate is based on prior experience and is reviewed quarterly. However, there is no certainty the stated liability for claims and other benefits, including the estimate of unsubmitted claims, will be Torchmark’s ultimate obligation. |
Income Taxes | Income Taxes : Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement book values and tax bases of assets and liabilities. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. On December 22, 2017, the Tax Cuts and Jobs Act (Tax Legislation) was enacted into law which changed existing tax law, including a reduction of the corporate income tax rate from 35% to 21% effective January 1, 2018. In 2017, the Company recorded $874 million in net income, primarily as a result of remeasuring its deferred assets and liabilities using the lower corporate tax rate as of the date of enactment. In the fourth quarter of 2018, the Company completed its analysis of the tax legislation and recorded an additional $798 thousand adjustment related to the remeasurement of the deferred tax assets and liabilities based on the 21% rate. |
Postretirement Benefits | Postretirement Benefits : Torchmark accounts for its postretirement defined benefit plans by recognizing the funded status of those plans on its Consolidated Balance Sheets in accordance with accounting guidance. Periodic gains and losses attributable to changes in plan assets and liabilities that are not recognized as components of net periodic benefit costs are recognized as components of other comprehensive income, net of tax. |
Treasury Stock | Treasury Stock : Torchmark accounts for purchases of treasury stock on the cost method. Issuance of treasury stock is accounted for using the weighted-average cost method. |
Recognition of Premium Revenue and Related Expenses | Recognition of Premium Revenue and Related Expenses : Premium income for traditional long-duration life and health insurance products is recognized evenly over the contract period and when due from the policyholder. Premiums for short-duration health contracts are recognized as revenue over the contract period in proportion to the insurance protection provided. Premiums for universal life-type and annuity contracts are added to the policy account value, and revenues for such products are recognized as charges to the policy account value for mortality, administration, and surrenders (retrospective deposit method). Life premium includes policy charges of $16 million , $17 million , and $18 million for the years ended December 31, 2018 , 2017 , and 2016 , respectively. Other premium consists of annuity policy charges in each year. For most insurance products, the related benefits and expenses are matched with revenues by means of the provision of future policy benefits and the amortization of DAC in a manner which recognizes profits as they are earned over the revenue recognition period. For limited-payment life insurance products, the profits are recognized over the contract period. |
Stock-Based Compensation | Stock-Based Compensation : Torchmark accounts for stock-based compensation by recognizing an expense in the consolidated financial statements based on the “fair value method.” The fair value method requires that a fair value be assigned to a stock option or other stock grant on its grant date and that this value be amortized over the grantees’ service period. The fair value method requires the use of an option valuation model to value employee stock options. Torchmark has elected to use the Black-Scholes valuation model for option expensing. A summary of assumptions for options granted in each of the three years 2016 through 2018 is as follows: 2018 2017 2016 Volatility factor 13.7 % 14.8 % 19.2 % Dividend yield 0.7 % 0.7 % 1.1 % Expected term (in years) 5.76 5.71 5.78 Risk-free rate 2.7 % 2.0 % 1.3 % The expected term is generally derived from Company experience. However, expected terms are determined based on the simplified method as permitted under the ASC 718 Stock Compensation topic when Company experience is insufficient. The Torchmark Corporation 2011 Incentive Plan replaced all previous plans and allows for option grants for employees with a ten -year contractual term which vest over five years in addition to seven -year grants which vest over three years as permitted by the previous plans. Director grants vest over six months. The Company has sufficient experience with seven -year grants that vest in three years, but insufficient historical experience with five -year vesting. Therefore, Torchmark has used the simplified method to determine the expected term for the ten -year grants with five -year vesting and will do so until adequate experience is developed. Volatility and risk-free interest rates are assumed over a period of time consistent with the expected term of the option. Volatility is measured on a historical basis. Monthly data points are utilized to derive volatility for periods greater than three years. Expected dividend yield is based on current dividend yield held constant over the expected term. Once the fair value of an option has been determined, it is amortized on a straight-line basis over the employee’s service period for that grant (from the grant date to the date the grant is fully vested). Expenses for restricted stock and restricted stock units are based on the grant date fair value allocated on a straight-line basis over the service period. Performance share expense is recognized based on management’s estimate of the probability of meeting the metrics identified in the performance share award agreement, assigned to each service period as these estimates develop. On April 26, 2018, the shareholders approved of the Torchmark Corporation 2018 Incentive Plan. No awards related to this plan were issued as of December 31, 2018. The 2018 Incentive Plan replaced all previous plans. Torchmark management views all stock-based compensation expense as a corporate or Parent Company expense and, therefore, presents it as such in its segment analysis (See Note 14—Business Segments ). It is included in “Other operating expense” in the Consolidated Statements of Operations . |
Earnings Per Share | Earnings per Share : Torchmark presents basic and diluted earnings per common share (EPS) on the face of the Consolidated Statements of Operations for income from continuing operations and income from discontinued operations. Basic EPS is computed by dividing income available to common shareholders by the weighted average common shares outstanding for the period. Diluted EPS is calculated by adding to shares outstanding the additional net effect of potentially dilutive securities or contracts, such as stock options, which could be exercised or converted into common shares. |
Accounting Pronouncements Adopted In Current Year / Not Yet Adopted | Accounting Pronouncements Adopted in the Current Year Standard Description Effective date Effect on the consolidated financial statements ASU No. 2016-01 , Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities This ASU primarily revises the classification and measurement of certain equity investments such that they will be measured at fair value through net income. Additionally, the guidance eliminates the cost method for partnerships and joint ventures and requires these types of investments to be accounted for under the fair value through net income or equity method. This standard became effective for the Company on January 1, 2018. On January 1, 2018, the Company adopted this standard on a modified retrospective basis for two types of investments: equity securities and certain limited partnerships. The adoption resulted in a $4.9 million after-tax positive adjustment to the opening balance of retained earnings. Subsequent to the adoption, the Company elected to measure its investment in certain limited partnerships at fair value in accordance with the fair value option for financial instruments with changes recognized in "Realized Gains (Losses)" in the Consolidated Statements of Operations . As of December 31, 2018, the fair value balance of the limited partnerships was $108 million. See Note 4—Investments for further discussion. ASU No. 2016-15 , Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments This ASU provided uniformity in the classification of cash receipts and payments recorded in the statement of cash flows including debt prepayment or debt extinguishment costs, settlement of zero-coupon bonds, and proceeds from the settlement of insurance claims. This standard became effective on January 1, 2018. This standard did not have a material impact to the classification on the Consolidated Statement of Cash Flows . ASU No. 2017-07 , Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost This standard was issued to simplify the reporting of pension costs by disaggregating the service-cost component from the other components of net benefit costs and reporting it separately on the income statement. The service-cost component is the only component of net benefit cost that will be eligible for capitalization. This standard became effective on January 1, 2018 with a retrospective transition method for separation of net benefit costs and a prospective transition method for the capitalization of service costs. For the twelve months ended December 31, 2018, the Company recorded $3.1 million in additional expense to the 2018 Consolidated Statements of Operations due to the elimination of the ability to capitalize a portion of the benefit costs. There was no impact to the Consolidated Statements of Operations in regards to separately reporting expenses as the Company reports all costs on one line item (Other Operating Expenses). See Note 9—Postretirement benefits. Accounting Pronouncements Yet to be Adopted Standard Description Effective date Effect on the consolidated financial statements ASU No. 2016-02/2018-11 , Leases (Topic 842), with clarification guidance issued in July 2018. The standard requires lessees to record a right-of-use asset and corresponding lease liability on the balance sheet for all operating leases that do not qualify for the practical expedients allowed for in this standard. Additional qualitative and quantitative disclosures will be required. This standard will become effective for the Company beginning January 1, 2019. The Company plans to adopt the optional transition method allowed for under ASU 2018-11 by not restating comparative periods and recognizing a cumulative-effect adjustment to the opening balance of retained earnings on the period of adoption. The Company does not have any significant lessor contracts. In 2018, the Company completed and implemented appropriate solutions to identify and quantify applicable operating leases in accordance with this standard. Based on our analysis, this standard has an immaterial impact to the consolidated financial statements. Refer to Note 6—Commitments and Contingencies for consideration of the noncancelable operating lease commitments. ASU No. 2016-13 , Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments This standard provides financial statement users with more decision-useful information about the expected credit losses on financial instruments as well as to change the loss impairment methodology for available-for-sale debt securities by use of an allowance rather than a direct write-down. This standard will become effective on January 1, 2020. The applicable section of the standard related to debt securities requires a prospective transition. The Company is in the process of determining the impact this guidance will have on the consolidated financial statements. ASU No. 2017-08 , Receivables—Nonrefundable Fees and Other Costs (Topic 310-20): Premium Amortization on Purchased Callable Debt Securities This guidance was issued to shorten the amortization period for certain callable debt securities held at a premium. The guidance requires the premium to be amortized to the earliest call date. This standard will become effective on January 1, 2019 with early adoption permitted, including during interim periods. The adoption is to be applied on a modified retrospective basis through an adjustment to retained earnings. This adoption did not have a material impact on the consolidated financial statements as of January 1, 2019. ASU No. 2018-12 , Financial Services - Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts The guidance was primarily issued to 1) improve the timeliness of recognizing changes in the liability for future policy benefits and modify the rate used to discount future cash flows, 2) simplify and improve the accounting for certain market-based options or guarantees associated with deposit (or account balance) contracts, 3) simplify the amortization of deferred acquisition costs, and 4) improve the effectiveness of the required disclosures. This standard is effective beginning January 1, 2021, and should be applied on a retrospective basis. Early adoption of the amendments is permitted. ASU 2018-12 will require changes to the Company's actuarial systems and data inputs related to the valuation of the future policy benefits. The Company is in the process of evaluating the impact this guidance will have on the consolidated financial statements and cannot reasonably estimate such impact at this time. Accounting Pronouncements Yet to be Adopted (continued) Standard Description Effective date Effect on the consolidated financial statements ASU No. 2018-13 , Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement The amendment modifies the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. The revised standard is effective beginning January 1, 2020. The removed and modified disclosures will be adopted on a retrospective basis and the new disclosures will be adopted on a prospective basis. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on the consolidated financial statements. ASU No. 2018-14 , Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20), Changes to the Disclosure Requirements for Defined Benefit Plans. The guidance removes disclosures that are no longer considered cost beneficial, clarifies the specific requirements of disclosures and adds disclosure requirements identified as relevant. This standard is effective beginning January 1, 2021, and will be applied retrospectively. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on the consolidated financial statements. ASU No. 2018-15 , Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract The guidance was issued to align the accounting for implementation costs of hosting arrangements, regardless of whether they convey a license to the hosted software. Accordingly, the standard requires the capitalization of implementation costs incurred in a hosting arrangement that is a service contract, similar to the treatment for developed or obtained internal-use software. The guidance is effective beginning January 1, 2020, and the Company plans to apply the standards on a prospective basis. Early adoption of the amendments is also permitted. The Company is in the process of determining the impact this guidance will have on the consolidated financial statements. |
Fair Value Measurements, Investments in Securities | |
Significant Accounting Policies [Line Items] | |
Fair Value Measurements | Fair Value Measurements, Investments in Securities : Torchmark measures the fair value of its fixed maturities based on a hierarchy consisting of three levels which indicate the quality of the fair value measurements as described below: • Level 1— fair values are based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date. • Level 2— fair values are based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, or inputs that can otherwise be corroborated by observable market data. • Level 3— fair values are based on inputs that are considered unobservable where there is little, if any, market activity for the asset or liability as of the measurement date. In this circumstance, the Company has to rely on values derived by independent brokers or internally-developed assumptions. Unobservable inputs are developed based on the best information available to the Company which may include the Company’s own data or bid and ask prices in the dealer market. The great majority of Torchmark's fixed maturities are not actively traded and direct quotes are not generally available. Management therefore determines the fair values of these securities after consideration of data provided by third-party pricing services, independent broker/dealers, and other resources. At December 31, 2018 , Torchmark's investments in fixed maturities were primarily composed of the following significant security types: corporate securities, state and municipal securities, and U.S. government securities. The remaining security types represented less than 2% of the total in the aggregate. Over 95% of the fair value reported at December 31, 2018 was determined using data provided by third-party pricing services. Prices provided by these services are not binding offers, but are estimated exit values. Third-party pricing services use proprietary pricing models to determine security values by discounting cash flows using a market-adjusted spread to a benchmark yield. For all asset classes within Torchmark’s significant security types, third-party pricing services use a common valuation technique to model the price of the investments using observable market data. The foundation for these models consists of developing yield spreads based on multiple observable market inputs, including but not limited to: benchmark yield curves, actual trading activity, new issue yields, broker-dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, sector-specific data, economic data, and other inputs that are corroborated in the market. Pricing vendors monitor and review their pricing data continuously with current market and economic data feeds, augmented by ongoing communication within the dealer community. Using the observable market inputs described above, spreads to an appropriate benchmark yield are further developed by the vendors for each security based on security-specific and/or sector-specific risk factors, such as a security’s terms and conditions (coupon, maturity, and call features), credit rating, sector, liquidity, collateral or other cash flow options, and other factors that could impact the risk of the security. Embedded repayment options, such as call and redemption features, are also taken into account in the pricing models. When the spread is determined, it is added to the security’s benchmark yield. The security's expected cash flows are discounted using this spread-adjusted yield, and the resulting present value of the discounted cash flows is the evaluated price. When third-party vendor prices are not available, the Company attempts to obtain valuations from other sources, including but not limited to broker/dealers, broker quotes, and prices on comparable securities. When valuations have been obtained for all securities in the portfolio, management reviews and analyzes the prices to ensure their reasonableness, taking into account available observable information. When two or more valuations are available for a security and the variance between the prices is 10% or less, the close correlation suggests similar observable inputs were used in deriving the price, and the mean of the prices is used. Securities valued in this manner are classified as Level 2. When the variance between two or more valuations for a security exceeds 10%, additional analysis is performed to determine the most appropriate value for that security, using resources such as broker quotes, prices on comparable securities, recent trades, and any other observable market data. Further review is performed on the available valuations to determine if they can be corroborated within reasonable tolerance to any other observable evidence. If one of the valuations or the mean of the available valuations for a security can be corroborated with other observable evidence, then the corroborated value is used and reported as Level 2. The Company uses information and analytical techniques deemed appropriate for determining the point within the range of reasonable fair value estimates that is most representative of fair value under current market conditions. Valuations that cannot be corroborated within a reasonable tolerance are classified as Level 3. Torchmark invests in a portfolio of private placement fixed maturities that are not actively traded. This portfolio is managed by third parties. The portfolio managers provide valuations for the bonds based on a pricing matrix utilizing observable inputs, such as the benchmark treasury rate and published sector indices, and unobservable inputs such as an internally-developed credit rating. If they cannot be corroborated, the fair values are classified as Level 3. |
Fair Value Measurements, Other Financial Instruments | |
Significant Accounting Policies [Line Items] | |
Fair Value Measurements | Fair Value Measurements, Other Financial Instruments : Fair values for cash, short-term investments, short-term debt, commercial mortgage loan participations, limited partnerships, receivables, and payables approximate carrying value. Fair values of mortgage loans are determined based upon expected cash flows discounted at an appropriate risk-adjusted rate. The fair value of investments in limited partnerships that provide low-income housing tax credits is based on discounted projected cash flows. The commercial mortgage loan participations and the limited partnerships are classified as level 3. Policy loans are an integral part of Torchmark’s subsidiaries’ life insurance policies in force and their fair values cannot be valued separately and apart from the insurance contracts. The fair values of Torchmark’s long-term debt issues are based on the same methodology as investments in fixed maturities. At December 31, 2018 , observable inputs were available for these debt securities and as such were classified as Level 2 in the valuation hierarchy. The fair value for each debt instrument as of December 31, 2018 is disclosed in Note 11—Debt . As described in Note 9—Postretirement Benefits , Torchmark maintains a nonqualified supplemental retirement plan. Therefore the assets, that support the liability for this plan, are considered general assets of the Company. These assets consist of the cash value of corporate-owned life insurance policies (COLI) and exchange traded funds (ETFs). The fair value of the insurance cash values approximates carrying value. Fair values for the ETFs are derived from direct quotes and are considered Level 1 in the valuation hierarchy. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Assumptions for Options Granted | A summary of assumptions for options granted in each of the three years 2016 through 2018 is as follows: 2018 2017 2016 Volatility factor 13.7 % 14.8 % 19.2 % Dividend yield 0.7 % 0.7 % 1.1 % Expected term (in years) 5.76 5.71 5.78 Risk-free rate 2.7 % 2.0 % 1.3 % |
Schedule of Accounting Pronouncements Adopted In Current Year / Not Yet Adopted | Accounting Pronouncements Adopted in the Current Year Standard Description Effective date Effect on the consolidated financial statements ASU No. 2016-01 , Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities This ASU primarily revises the classification and measurement of certain equity investments such that they will be measured at fair value through net income. Additionally, the guidance eliminates the cost method for partnerships and joint ventures and requires these types of investments to be accounted for under the fair value through net income or equity method. This standard became effective for the Company on January 1, 2018. On January 1, 2018, the Company adopted this standard on a modified retrospective basis for two types of investments: equity securities and certain limited partnerships. The adoption resulted in a $4.9 million after-tax positive adjustment to the opening balance of retained earnings. Subsequent to the adoption, the Company elected to measure its investment in certain limited partnerships at fair value in accordance with the fair value option for financial instruments with changes recognized in "Realized Gains (Losses)" in the Consolidated Statements of Operations . As of December 31, 2018, the fair value balance of the limited partnerships was $108 million. See Note 4—Investments for further discussion. ASU No. 2016-15 , Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments This ASU provided uniformity in the classification of cash receipts and payments recorded in the statement of cash flows including debt prepayment or debt extinguishment costs, settlement of zero-coupon bonds, and proceeds from the settlement of insurance claims. This standard became effective on January 1, 2018. This standard did not have a material impact to the classification on the Consolidated Statement of Cash Flows . ASU No. 2017-07 , Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost This standard was issued to simplify the reporting of pension costs by disaggregating the service-cost component from the other components of net benefit costs and reporting it separately on the income statement. The service-cost component is the only component of net benefit cost that will be eligible for capitalization. This standard became effective on January 1, 2018 with a retrospective transition method for separation of net benefit costs and a prospective transition method for the capitalization of service costs. For the twelve months ended December 31, 2018, the Company recorded $3.1 million in additional expense to the 2018 Consolidated Statements of Operations due to the elimination of the ability to capitalize a portion of the benefit costs. There was no impact to the Consolidated Statements of Operations in regards to separately reporting expenses as the Company reports all costs on one line item (Other Operating Expenses). See Note 9—Postretirement benefits. Accounting Pronouncements Yet to be Adopted Standard Description Effective date Effect on the consolidated financial statements ASU No. 2016-02/2018-11 , Leases (Topic 842), with clarification guidance issued in July 2018. The standard requires lessees to record a right-of-use asset and corresponding lease liability on the balance sheet for all operating leases that do not qualify for the practical expedients allowed for in this standard. Additional qualitative and quantitative disclosures will be required. This standard will become effective for the Company beginning January 1, 2019. The Company plans to adopt the optional transition method allowed for under ASU 2018-11 by not restating comparative periods and recognizing a cumulative-effect adjustment to the opening balance of retained earnings on the period of adoption. The Company does not have any significant lessor contracts. In 2018, the Company completed and implemented appropriate solutions to identify and quantify applicable operating leases in accordance with this standard. Based on our analysis, this standard has an immaterial impact to the consolidated financial statements. Refer to Note 6—Commitments and Contingencies for consideration of the noncancelable operating lease commitments. ASU No. 2016-13 , Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments This standard provides financial statement users with more decision-useful information about the expected credit losses on financial instruments as well as to change the loss impairment methodology for available-for-sale debt securities by use of an allowance rather than a direct write-down. This standard will become effective on January 1, 2020. The applicable section of the standard related to debt securities requires a prospective transition. The Company is in the process of determining the impact this guidance will have on the consolidated financial statements. ASU No. 2017-08 , Receivables—Nonrefundable Fees and Other Costs (Topic 310-20): Premium Amortization on Purchased Callable Debt Securities This guidance was issued to shorten the amortization period for certain callable debt securities held at a premium. The guidance requires the premium to be amortized to the earliest call date. This standard will become effective on January 1, 2019 with early adoption permitted, including during interim periods. The adoption is to be applied on a modified retrospective basis through an adjustment to retained earnings. This adoption did not have a material impact on the consolidated financial statements as of January 1, 2019. ASU No. 2018-12 , Financial Services - Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts The guidance was primarily issued to 1) improve the timeliness of recognizing changes in the liability for future policy benefits and modify the rate used to discount future cash flows, 2) simplify and improve the accounting for certain market-based options or guarantees associated with deposit (or account balance) contracts, 3) simplify the amortization of deferred acquisition costs, and 4) improve the effectiveness of the required disclosures. This standard is effective beginning January 1, 2021, and should be applied on a retrospective basis. Early adoption of the amendments is permitted. ASU 2018-12 will require changes to the Company's actuarial systems and data inputs related to the valuation of the future policy benefits. The Company is in the process of evaluating the impact this guidance will have on the consolidated financial statements and cannot reasonably estimate such impact at this time. Accounting Pronouncements Yet to be Adopted (continued) Standard Description Effective date Effect on the consolidated financial statements ASU No. 2018-13 , Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement The amendment modifies the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. The revised standard is effective beginning January 1, 2020. The removed and modified disclosures will be adopted on a retrospective basis and the new disclosures will be adopted on a prospective basis. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on the consolidated financial statements. ASU No. 2018-14 , Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20), Changes to the Disclosure Requirements for Defined Benefit Plans. The guidance removes disclosures that are no longer considered cost beneficial, clarifies the specific requirements of disclosures and adds disclosure requirements identified as relevant. This standard is effective beginning January 1, 2021, and will be applied retrospectively. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on the consolidated financial statements. ASU No. 2018-15 , Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract The guidance was issued to align the accounting for implementation costs of hosting arrangements, regardless of whether they convey a license to the hosted software. Accordingly, the standard requires the capitalization of implementation costs incurred in a hosting arrangement that is a service contract, similar to the treatment for developed or obtained internal-use software. The guidance is effective beginning January 1, 2020, and the Company plans to apply the standards on a prospective basis. Early adoption of the amendments is also permitted. The Company is in the process of determining the impact this guidance will have on the consolidated financial statements. |
Statutory Accounting (Tables)
Statutory Accounting (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Insurance [Abstract] | |
Consolidated Net Income and Shareholders' Equity for Insurance Companies | Consolidated net income and shareholders’ equity (capital and surplus) on a statutory basis for the insurance subsidiaries were as follows: Net Income Shareholders’ Equity Year Ended December 31, At December 31, 2018 2017 2016 2018 2017 Life insurance subsidiaries $ 437,549 $ 426,285 $ 429,563 $ 1,443,156 $ 1,254,875 |
Supplemental Information Abou_2
Supplemental Information About Changes to Accumulated Other Comprehensive Income (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Schedule of Change in Balance by Component of Accumulated Other Comprehensive Income | An analysis in the change in balance by component of Accumulated Other Comprehensive Income is as follows for each of the years 2016 through 2018 . Components of Accumulated Other Comprehensive Income Available Deferred Foreign Pension Total For the year ended December 31, 2016: Balance at January 1, 2016 $ 332,333 $ (5,115 ) $ 3,627 $ (98,898 ) $ 231,947 Other comprehensive income (loss) before reclassifications, net of tax 356,016 (1,567 ) 1,340 (20,736 ) 335,053 Reclassifications, net of tax 3,965 — — 6,609 10,574 Other comprehensive income (loss) 359,981 (1,567 ) 1,340 (14,127 ) 345,627 Balance at December 31, 2016 692,314 (6,682 ) 4,967 (113,025 ) 577,574 For the year ended December 31, 2017: Other comprehensive income (loss) before reclassifications, net of tax 621,619 (350 ) 8,452 (20,753 ) 608,968 Reclassifications, net of tax (22,751 ) — — 8,083 (14,668 ) Other comprehensive income (loss) 598,868 (350 ) 8,452 (12,670 ) 594,300 Reclassifications, Tax reform 278,107 (1,515 ) 2,883 (27,075 ) 252,400 Balance at December 31, 2017 1,569,289 (8,547 ) 16,302 (152,770 ) 1,424,274 For the year ended December 31, 2018: Other comprehensive income (loss) before reclassifications, net of tax (1,132,202 ) 4,384 (9,807 ) 22,290 (1,115,335 ) Reclassifications, net of tax (1,389 ) — — 11,925 10,536 Other comprehensive income (loss) (1,133,591 ) 4,384 (9,807 ) 34,215 (1,104,799 ) Balance at December 31, 2018 $ 435,698 $ (4,163 ) $ 6,495 $ (118,555 ) $ 319,475 |
Summary of Reclassifications Out of Accumulated Other Comprehensive Income | Reclassification adjustments out of Accumulated Other Comprehensive Income are presented below for each of the years 2016 through 2018 . Reclassification Adjustments Year Ended December 31, Component Line Item 2018 2017 2016 Affected line items in the Unrealized gains (losses) on available for sale assets: Realized (gains) losses $ (5,715 ) $ (34,954 ) $ 10,285 Realized investment gains (losses) Amortization of (discount) premium 3,957 (47 ) (4,185 ) Net investment income Total before tax (1,758 ) (35,001 ) 6,100 Tax 369 12,250 (2,135 ) Income taxes Total after tax (1,389 ) (22,751 ) 3,965 Pension adjustments: Amortization of prior service cost 535 476 477 Other operating expenses Amortization of actuarial (gain) loss 14,560 11,960 9,691 Other operating expenses Total before tax 15,095 12,436 10,168 Tax (3,170 ) (4,353 ) (3,559 ) Income taxes Total after tax 11,925 8,083 6,609 Total reclassifications (after tax) $ 10,536 $ (14,668 ) $ 10,574 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Fixed Maturities and Equity Securities Available for Sale by Component | of fixed maturities available for sale by cost or amortized cost and estimated fair value at December 31, 2018 and 2017 are as follows. Redeemable preferred stock is included within the corporates by sector. At December 31, 2018 Cost or Gross Gross Fair Value (1) % of Total (2) Fixed maturities available for sale: U.S. Government direct, guaranteed, and government-sponsored enterprises $ 390,351 $ 5,104 $ (2,787 ) $ 392,668 2 States, municipalities, and political subdivisions 1,354,810 83,600 (1,750 ) 1,436,660 9 Foreign governments 19,006 1,810 — 20,816 — Corporates, by sector: Financial 3,759,768 262,875 (87,515 ) 3,935,128 24 Utilities 1,989,506 217,846 (24,399 ) 2,182,953 13 Energy 1,652,700 93,880 (62,371 ) 1,684,209 10 Other corporate sectors 6,382,707 283,524 (242,509 ) 6,423,722 40 Total corporates 13,784,681 858,125 (416,794 ) 14,226,012 87 Collateralized debt obligations 57,769 22,014 (6,414 ) 73,369 1 Other asset-backed securities 146,854 2,187 (634 ) 148,407 1 Total fixed maturities $ 15,753,471 $ 972,840 $ (428,379 ) $ 16,297,932 100 (1) Amount reported in the balance sheet. (2) At fair value. At December 31, 2017 Cost or Gross Gross Fair Value (1) % of Total (2) Fixed maturities available for sale: U.S. Government direct, guaranteed, and government-sponsored enterprises $ 390,646 $ 18,173 $ (1,373 ) $ 407,446 2 States, municipalities, and political subdivisions 1,091,960 127,890 (135 ) 1,219,715 7 Foreign governments 20,236 1,782 — 22,018 — Corporates, by sector: Financial 3,619,147 538,853 (26,119 ) 4,131,881 25 Utilities 1,984,290 371,538 (1,395 ) 2,354,433 14 Energy 1,619,349 226,140 (25,392 ) 1,820,097 11 Other corporate sectors 6,065,803 747,612 (20,616 ) 6,792,799 40 Total corporates 13,288,589 1,884,143 (73,522 ) 15,099,210 90 Collateralized debt obligations 59,150 20,084 (7,653 ) 71,581 — Other asset-backed securities 144,520 4,835 — 149,355 1 Total fixed maturities $ 14,995,101 $ 2,056,907 $ (82,683 ) $ 16,969,325 100 (1) Amount reported in the balance sheet. (2) At fair value. |
Schedule of Fixed Maturities by Contractual Maturity | A schedule of fixed maturities available for sale by contractual maturity date at December 31, 2018 is shown below on an amortized cost basis and on a fair value basis. Actual disposition dates could differ from contractual maturities due to call or prepayment provisions. At December 31, 2018 Amortized Fair Fixed maturities available for sale: Due in one year or less $ 190,025 $ 192,792 Due after one year through five years 631,833 656,317 Due after five years through ten years 1,680,184 1,811,532 Due after ten years through twenty years 5,090,608 5,516,103 Due after twenty years 7,955,528 7,898,702 Mortgage-backed and asset-backed securities 205,293 222,486 $ 15,753,471 $ 16,297,932 |
Schedule of Analysis of Investment Operations | Year Ended December 31, 2018 2017 2016 Fixed maturities available for sale $ 843,510 $ 817,213 $ 778,912 Policy loans 41,359 39,578 38,436 Other long-term investments 10,638 4,991 2,786 Short-term investments 2,642 948 447 898,149 862,730 820,581 Less investment expense (15,637 ) (14,845 ) (13,678 ) Net investment income $ 882,512 $ 847,885 $ 806,903 |
Realized Gain (Loss) on Investments | An analysis of realized gains (losses) is as follows: Year Ended December 31, 2018 2017 2016 Realized investment gains (losses): Fixed maturities available for sale: Sales and other $ 5,715 $ 35,199 $ (10,645 ) Other-than-temporary impairments — (245 ) — Fair value option—change in fair value 2,650 — — Other investments 909 (7,302 ) (38 ) Realized gains (losses) from investments 9,274 27,652 (10,683 ) Realized loss on redemption of debt (1) (11,078 ) (4,041 ) — (1,804 ) 23,611 (10,683 ) Applicable tax 379 (6,021 ) 3,739 Realized gains (losses), net of tax $ (1,425 ) $ 17,590 $ (6,944 ) (1) Refer to Note 11—Debt for further discussion . |
Unrealized Gain (Loss) on Investments | An analysis of the net change in unrealized investment gains (losses) is as follows: Year Ended December 31, 2018 2017 2016 Change in investment gains (losses) on: Fixed maturities available for sale $ (1,429,763 ) $ 916,413 $ 551,658 Other investments (5,155 ) 5,008 2,143 Net change in unrealized gains (losses) $ (1,434,918 ) $ 921,421 $ 553,801 |
Schedule of Selected Information about Sales of Fixed Maturities | Additional information about securities sold is as follows: Year Ended December 31, 2018 2017 2016 Fixed maturities available for sale: Proceeds from sales (1) $ 32,021 $ 67,246 $ 358,285 Gross realized gains 66 5,079 6,133 Gross realized losses (13,996 ) (1,100 ) (32,608 ) (1) Includes unsettled sales of $17.9 million at December 31, 2016 . There were no unsettled sales in 2018 or 2017 . |
Assets Measured at Fair Value on Recurring Basis | The following tables represent the fair value of fixed maturities measured on a recurring basis at December 31, 2018 and 2017 : Fair Value Measurements at December 31, 2018 Using: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value Fixed maturities available for sale: U.S. Government direct, guaranteed, and government-sponsored enterprises $ — $ 392,668 $ — $ 392,668 States, municipalities, and political subdivisions — 1,436,660 — 1,436,660 Foreign governments — 20,816 — 20,816 Corporates, by sector: Financial — 3,891,728 43,400 3,935,128 Utilities — 2,032,127 150,826 2,182,953 Energy — 1,645,077 39,132 1,684,209 Other corporate sectors — 6,103,609 320,113 6,423,722 Total corporates — 13,672,541 553,471 14,226,012 Collateralized debt obligations — — 73,369 73,369 Other asset-backed securities — 135,425 12,982 148,407 Total fixed maturities $ — $ 15,658,110 $ 639,822 $ 16,297,932 Percentage of total — % 96 % 4 % 100 % Fair Value Measurements at December 31, 2017 Using: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value Fixed maturities available for sale: U.S. Government direct, guaranteed, and government-sponsored enterprises $ — $ 407,446 $ — $ 407,446 States, municipalities, and political subdivisions 44 1,219,671 — 1,219,715 Foreign governments — 22,018 — 22,018 Corporates, by sector: Financial — 4,069,875 62,006 4,131,881 Utilities — 2,198,703 155,730 2,354,433 Energy — 1,779,281 40,816 1,820,097 Other corporate sectors — 6,468,541 324,258 6,792,799 Total corporates — 14,516,400 582,810 15,099,210 Collateralized debt obligations — — 71,581 71,581 Other asset-backed securities — 135,306 14,049 149,355 Total fixed maturities $ 44 $ 16,300,841 $ 668,440 $ 16,969,325 Percentage of total — % 96 % 4 % 100 % |
Schedule of Changes in Assets Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs | The following table represents changes in fixed maturities measured at fair value on a recurring basis using significant unobservable inputs (Level 3). Analysis of Changes in Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Asset- backed Securities Collateralized Debt Obligations Corporates Total Balance at January 1, 2016 $ — $ 70,382 $ 530,806 $ 601,188 Total gains or losses: Included in realized gains/losses — — 788 788 Included in other comprehensive income — (3,943 ) 6,403 2,460 Acquisitions — — 33,662 33,662 Sales — — — — Amortization — 5,186 17 5,203 Other (1) — (8,122 ) (12,076 ) (20,198 ) Transfers into (out of) Level 3 (2) — — — — Balance at December 31, 2016 — 63,503 559,600 623,103 Total gains or losses: Included in realized gains/losses — — — — Included in other comprehensive income 410 9,654 10,900 20,964 Acquisitions 14,000 — 21,666 35,666 Sales — — — — Amortization — 4,914 17 4,931 Other (1) (361 ) (6,490 ) (9,373 ) (16,224 ) Transfers into (out of) Level 3 (2) — — — — Balance at December 31, 2017 14,049 71,581 582,810 668,440 Total gains or losses: Included in realized gains/losses — — 698 698 Included in other comprehensive income (591 ) 3,170 (23,687 ) (21,108 ) Acquisitions — — 27,453 27,453 Sales — — — — Amortization — 4,737 16 4,753 Other (1) (476 ) (6,119 ) (38,352 ) (44,947 ) Transfers into (out of) Level 3 (2) — — 4,533 4,533 Balance at December 31, 2018 $ 12,982 $ 73,369 $ 553,471 $ 639,822 (1) Includes capitalized interest, foreign exchange adjustments and principal repayments. (2) There were no transfers in or out of Level 3 during 2016 and 2017. |
Quantitative Information about Level 3 Fair Value Measurements | Quantitative Information about Level 3 Fair Value Measurements As of December 31, 2018 Fair Value Valuation Significant Unobservable Range Weighted Asset-backed securities $ 12,982 Determination of credit spread Credit BBB- BBB- Discounted cash flows Discount 5.65% 5.65% Collateralized debt obligations 73,369 Discounted cash flows Discount 6.70 - 7.70% 7.51% Private placement fixed maturities 553,471 Determination of credit spread Credit A+ to BB- BBB Discounted cash flows Discount 3.62 - 11.30% 4.67% $ 639,822 |
Transfers in and Out of Each of the Valuation Levels of Fair Values | The following table presents transfers in and out of each of the valuation levels of fair values. 2018 2017 2016 In Out Net In Out Net In Out Net Level 1 $ — $ — $ — $ 42,372 $ (597 ) $ 41,775 $ 45,344 $ — $ 45,344 Level 2 — (4,533 ) (4,533 ) 597 (42,372 ) (41,775 ) — (45,344 ) (45,344 ) Level 3 4,533 — 4,533 — — — — — — |
Schedule of Unrealized Investment Losses by Class of Investment | Analysis of Gross Unrealized Investment Losses At December 31, 2018 Less than Twelve Months Twelve Months or Longer Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Fixed maturities available for sale: Investment grade securities: U.S. Government direct, guaranteed, and government-sponsored enterprises $ 37,182 $ (212 ) $ 89,664 $ (2,575 ) $ 126,846 $ (2,787 ) States, municipalities and political subdivisions 124,907 (1,648 ) 7,981 (102 ) 132,888 (1,750 ) Foreign governments — — — — — — Corporates, by sector: Financial 931,161 (36,337 ) 241,442 (21,572 ) 1,172,603 (57,909 ) Utilities 329,753 (11,680 ) 121,308 (9,442 ) 451,061 (21,122 ) Energy 475,736 (29,426 ) 54,937 (9,382 ) 530,673 (38,808 ) Other corporate sectors 2,515,541 (149,168 ) 575,796 (62,994 ) 3,091,337 (212,162 ) Total corporates 4,252,191 (226,611 ) 993,483 (103,390 ) 5,245,674 (330,001 ) Other asset-backed securities 44,603 (634 ) — — 44,603 (634 ) Total investment grade securities 4,458,883 (229,105 ) 1,091,128 (106,067 ) 5,550,011 (335,172 ) Below investment grade securities: States, municipalities and political subdivisions — — — — — — Corporates, by sector: Financial 22,087 (8,674 ) 81,101 (20,932 ) 103,188 (29,606 ) Utilities 28,613 (3,277 ) — — 28,613 (3,277 ) Energy 42,874 (3,901 ) 36,122 (19,662 ) 78,996 (23,563 ) Other corporate sectors 146,373 (7,235 ) 69,053 (23,112 ) 215,426 (30,347 ) Total corporates 239,947 (23,087 ) 186,276 (63,706 ) 426,223 (86,793 ) Collateralized debt obligations — — 13,586 (6,414 ) 13,586 (6,414 ) Total below investment grade securities 239,947 (23,087 ) 199,862 (70,120 ) 439,809 (93,207 ) Total fixed maturities $ 4,698,830 $ (252,192 ) $ 1,290,990 $ (176,187 ) $ 5,989,820 $ (428,379 ) Analysis of Gross Unrealized Investment Losses At December 31, 2017 Less than Twelve Months Twelve Months or Longer Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Fixed maturities available for sale: Investment grade securities: U.S. Government direct, guaranteed, and government-sponsored enterprises $ 34,388 $ (422 ) $ 47,514 $ (951 ) $ 81,902 $ (1,373 ) States, municipalities and political subdivisions 4,561 (21 ) 1,771 (9 ) 6,332 (30 ) Foreign governments — — — — — — Corporates, by sector: Financial 133,080 (652 ) 35,302 (1,429 ) 168,382 (2,081 ) Utilities 48,562 (569 ) 38,298 (826 ) 86,860 (1,395 ) Energy 23,463 (81 ) 67,775 (3,682 ) 91,238 (3,763 ) Other corporate sectors 220,661 (2,312 ) 163,886 (4,257 ) 384,547 (6,569 ) Total corporates 425,766 (3,614 ) 305,261 (10,194 ) 731,027 (13,808 ) Collateralized debt obligations — — — — — — Other asset-backed securities — — — — — — Total investment grade securities 464,715 (4,057 ) 354,546 (11,154 ) 819,261 (15,211 ) Below investment grade securities: States, municipalities and political subdivisions 200 (105 ) — — 200 (105 ) Corporates, by sector: Financial — — 108,808 (24,038 ) 108,808 (24,038 ) Energy 8,114 (104 ) 75,204 (21,525 ) 83,318 (21,629 ) Other corporate sectors 25,334 (5,066 ) 54,383 (8,981 ) 79,717 (14,047 ) Total corporates 33,448 (5,170 ) 238,395 (54,544 ) 271,843 (59,714 ) Collateralized debt obligations — — 12,347 (7,653 ) 12,347 (7,653 ) Total below investment grade securities 33,648 (5,275 ) 250,742 (62,197 ) 284,390 (67,472 ) Total fixed maturities $ 498,363 $ (9,332 ) $ 605,288 $ (73,351 ) $ 1,103,651 $ (82,683 ) |
Schedule of Additional Information about Investments in Unrealized Loss Position | Additional information about fixed maturities available for sale in an unrealized loss position is as follows: Less than Twelve Total Number of issues (CUSIP numbers) held: As of December 31, 2018 495 234 729 As of December 31, 2017 92 102 194 |
Schedule of Other Long-Term Investments | Other long-term investments consist of the following: Year Ended December 31, 2018 2017 Investment in limited partnerships $ 108,241 $ 66,522 Commercial mortgage loan participations 96,266 39,489 Other 2,751 2,548 Total $ 207,258 $ 108,559 |
Schedule Of Percentages Of Investments By Major Components At Fair Value | At December 31, 2018 , the investment portfolio, at fair value, consisted of the following: Investment grade fixed maturities: Corporate securities 80 % Securities of state and municipal governments 8 Government-sponsored enterprises 2 Other 2 Below investment grade fixed maturities: Corporate securities 3 Other — Policy loans, which are secured by the underlying insurance policy values 3 Other investments 2 100 % |
Schedule Of Industry Concentrations Held In Corporate Portfolio | Below are the ten largest industry concentrations held in the corporate portfolio of corporate debt securities and redeemable preferred stocks at December 31, 2018 , based on fair value: Insurance 15 % Electric utilities 11 Oil and natural gas pipelines 7 Banks 6 Transportation 4 Real estate investment trusts 4 Oil and natural gas exploration and production 4 Chemicals 4 Food 4 Gas utilities 3 |
Schedule of Commercial Loan Participations | Summaries of commercial mortgage loan participations at December 31, 2018 and 2017 are as follows: 2018 2017 Carrying Value % of Total Carrying Value % of Total Property type: Office $ 35,289 37 $ 18,378 46 Hospitality 15,137 16 10,496 27 Industrial 13,896 14 — — Retail 12,934 13 — — Mixed use 11,309 12 7,148 18 Multi-family 7,701 8 3,467 9 Total recorded investment 96,266 100 39,489 100 Less valuation allowance — — — — Carrying value, net of valuation allowance $ 96,266 100 $ 39,489 100 2018 2017 Carrying Value % of Total Carrying Value % of Total Geographic location: South Atlantic $ 39,414 41 $ 18,378 46 Middle Atlantic 23,488 24 3,467 9 Pacific 20,843 22 7,148 18 East North Central 10,531 11 10,496 27 West South Central 1,990 2 — — Total recorded investment 96,266 100 39,489 100 Less valuation allowance — — — — Carrying value, net of valuation allowance $ 96,266 100 $ 39,489 100 |
Commercial Loan Participation Credit Quality Indicators | 2018 Recorded Investment Debt Service Coverage Ratios <1.00x 1.00x—1.20x >1.20x Total % of Total Loan-to-value ratio: Less than 70% $ 18,343 $ 56,813 $ 10,531 $ 85,687 89 70% to 80% 10,579 — — 10,579 11 81% to 90% — — — — — Greater than 90% — — — — — Total $ 28,922 $ 56,813 $ 10,531 $ 96,266 100 2017 Recorded Investment Debt Service Coverage Ratios <1.00x 1.00x—1.20x >1.20x Total % of Total Loan-to-value ratio: Less than 70% $ — $ 18,378 $ 10,496 $ 28,874 73 70% to 80% 3,467 7,148 — 10,615 27 81% to 90% — — — — — Greater than 90% — — — — — Total $ 3,467 $ 25,526 $ 10,496 $ 39,489 100 |
Deferred Acquisition Costs (Tab
Deferred Acquisition Costs (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Insurance [Abstract] | |
Analysis of Deferred Acquisition Costs | An analysis of DAC is as follows: Year Ended December 31, 2018 2017 2016 Balance at beginning of year $ 3,958,063 $ 3,783,158 $ 3,617,135 Additions: Deferred during period: Commissions 497,459 465,920 436,252 Other expenses 202,092 194,214 199,066 Total deferred 699,551 660,134 635,318 Foreign exchange adjustment — 5,712 2,180 Adjustment attributable to unrealized investment losses (1) 5,549 — — Total additions 705,100 665,846 637,498 Deductions: Amortized during period (516,690 ) (490,403 ) (469,063 ) Foreign exchange adjustment (8,548 ) — — Adjustment attributable to unrealized investment gains (1) — (538 ) (2,412 ) Total deductions (525,238 ) (490,941 ) (471,475 ) Balance at end of year $ 4,137,925 $ 3,958,063 $ 3,783,158 (1) Represents amounts pertaining to investments relating to universal life-type products. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Operating Leases of Lessee Disclosure | Rental expense for operating leases for each of the three years ended December 31, 2018 is as follows: Year Ended December 31, 2018 2017 2016 Rental expense $ 3,959 $ 6,446 $ 6,520 Future minimum rental commitments required under operating leases having remaining noncancelable lease terms in excess of one year at December 31, 2018 were as follows: Year Ended December 31, 2019 2020 2021 2022 2023 Thereafter Operating lease commitments $ 4,304 $ 4,208 $ 3,560 $ 2,755 $ 1,916 $ 6,596 |
Long-term Purchase Commitment | Year Ended December 31, 2019 2020 2021 2022 2023 Thereafter Purchase commitments $ 27,938 $ 23,515 $ 4,121 $ 2,705 $ 3,018 $ 244,854 |
Liability for Unpaid Claims (Ta
Liability for Unpaid Claims (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Insurance [Abstract] | |
Summary of Liability for Unpaid Health Claims | Activity in the liability for unpaid health claims is summarized as follows: Year Ended December 31, 2018 2017 2016 Balance at beginning of year $ 146,865 $ 143,128 $ 137,120 Incurred related to: Current year 555,647 520,528 510,075 Prior years (3,017 ) (8,048 ) (1,127 ) Total incurred 552,630 512,480 508,948 Paid related to: Current year 424,633 394,506 386,278 Prior years 120,334 114,237 116,662 Total paid 544,967 508,743 502,940 Balance at end of year $ 154,528 $ 146,865 $ 143,128 |
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability | Below is the reconciliation of the liability for "Policy claims and other benefits payable" in the Consolidated Balance Sheets . At December 31, 2018 2017 Policy claims and other benefits payable: Life insurance $ 196,298 $ 186,429 Health insurance 154,528 146,865 Total $ 350,826 $ 333,294 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Components of Income Taxes | The following table discloses significant components of income taxes for each year presented: Year Ended December 31, 2018 2017 2016 Income tax expense (benefit) from continuing operations: Current income tax expense (benefit) $ 134,626 $ 138,262 $ 132,806 Deferred income tax expense (benefit) 27,535 (765,877 ) 99,839 162,161 (627,615 ) 232,645 Shareholders’ equity: Other comprehensive income (loss) (293,678 ) 318,475 186,206 $ (131,517 ) $ (309,140 ) $ 418,851 |
Summary of Effective Income Tax Rate | The effective income tax rate differed from the expected U.S. federal statutory rate of 21% for 2018 and 35% for prior years as shown below: Year Ended December 31, 2018 % 2017 % 2016 % Expected federal income tax expense (benefit) $ 181,371 21.0 $ 290,727 35.0 $ 270,282 35.0 Increase (reduction) in income taxes resulting from: Tax reform adjustment (798 ) (0.1 ) (877,400 ) (105.6 ) — — Low income housing investments (12,240 ) (1.4 ) (18,515 ) (2.2 ) (18,202 ) (2.4 ) Share-based awards (6,450 ) (0.7 ) (19,549 ) (2.4 ) (18,653 ) (2.4 ) Other 278 — (2,878 ) (0.4 ) (782 ) (0.1 ) Income tax expense (benefit) $ 162,161 18.8 $ (627,615 ) (75.6 ) $ 232,645 30.1 |
Significant Portions of Deferred Tax Assets and Deferred Tax Liabilities | The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below: December 31, 2018 2017 Deferred tax assets: Fixed maturity investments $ 6,131 $ 8,692 Carryover of tax losses 7,406 4,760 Total gross deferred tax assets 13,537 13,452 Deferred tax liabilities: Unrealized gains 87,871 380,251 Employee and agent compensation 70,551 65,576 Deferred acquisition costs 633,687 618,889 Future policy benefits, unearned and advance premiums, and policy claims 242,285 248,752 Other liabilities 25,603 11,289 Total gross deferred tax liabilities 1,059,997 1,324,757 Net deferred tax liability $ 1,046,460 $ 1,311,305 |
Postretirement Benefits (Tables
Postretirement Benefits (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Total Cost of Retirement Plans Charged to Operations | The total cost of these retirement plans charged to operations was as follows: Year Ended December 31, Defined (1) Defined (2) 2018 $ 4,068 $ 32,593 2017 4,145 28,828 2016 3,614 24,202 (1) 401K plans (2) Qualified pension plans and SERP |
Schedule of Defined Benefit Plans Disclosures | The following table includes premiums paid for the SERP for the three years ended December 31, 2018 and investments of the Rabbi Trust for the two years ended December 31, 2018 . Year Ended December 31, 2018 2017 2016 Premiums paid for insurance coverage $ 2,997 $ 2,050 $ 2,050 At December 31, 2018 2017 Total investments: Company owned life insurance $ 44,285 $ 40,273 Exchange traded funds 52,659 55,442 $ 96,944 $ 95,715 |
Pension Assets by Component at Fair Value | The following table presents the assets of Torchmark’s defined benefit pension plans for the years ended December 31, 2018 and 2017 . Pension Assets by Component at December 31, 2018 Fair Value Determined by: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Amount % to Total Corporate bonds: Financial $ — $ 44,236 $ — $ 44,236 11 Utilities — 39,443 — 39,443 10 Energy — 19,744 — 19,744 5 Other corporates — 83,202 — 83,202 22 Total corporate bonds — 186,625 — 186,625 48 Exchange traded fund (1) 157,717 — — 157,717 40 Other bonds — 245 — 245 — Other long-term investments — 8,475 — 8,475 2 Guaranteed annuity contract (2) — 26,505 — 26,505 7 Short-term investments 9,289 — — 9,289 2 Other 3,816 — — 3,816 1 Total $ 170,822 $ 221,850 $ — $ 392,672 100 (1) A fund including marketable securities that mirror the S&P 500 index. (2) Representing a guaranteed annuity contract issued by Torchmark's subsidiary, American Income Life Insurance Company, to fund the obligations of the American Income Pension Plan. Pension Assets by Component at December 31, 2017 Fair Value Determined by: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Amount % to Total Corporate bonds: Financial $ — $ 43,451 $ — $ 43,451 12 Utilities — 46,144 — 46,144 12 Energy — 25,023 — 25,023 7 Other corporates — 65,888 — 65,888 17 Total corporate bonds — 180,506 — 180,506 48 Exchange traded fund (1) 164,351 — — 164,351 43 Other bonds — 256 — 256 — Other long-term investments — 2,304 — 2,304 1 Guaranteed annuity contract (2) — 21,202 — 21,202 6 Short-term investments 3,984 — — 3,984 1 Other 5,021 — — 5,021 1 Total $ 173,356 $ 204,268 $ — $ 377,624 100 (1) A fund including marketable securities that mirror the S&P 500 index. (2) Representing a guaranteed annuity contract issued by Torchmark's subsidiary, American Income Life Insurance Company, to fund the obligations of the American Income Pension Plan. |
Pension Liability | Pension Liability December 31, 2018 2017 PBO ABO PBO ABO Funded defined benefit pension $ 481,792 $ 436,316 $ 518,141 $ 466,307 SERP 74,407 69,582 84,465 74,656 $ 556,199 $ 505,898 $ 602,606 $ 540,963 |
Analysis of Impact on Other Comprehensive Income (Loss) | An analysis of the impact on other comprehensive income (loss) concerning pensions and other postretirement benefits is as follows: Year Ended December 31, 2018 2017 2016 Balance at January 1 $ (193,380 ) $ (173,883 ) $ (152,149 ) Amortization of: Prior service cost 535 476 477 Net actuarial (gain) loss (1) 14,560 11,960 9,691 Total amortization 15,095 12,436 10,168 Plan amendments (2,377 ) — — Experience gain (loss) 30,591 (31,933 ) (31,902 ) Balance at December 31 $ (150,071 ) $ (193,380 ) $ (173,883 ) (1) Includes amortization of postretirement benefits other than pensions of $92 thousand in 2018 , $155 thousand in 2017 , and $33 thousand in 2016 . |
Portion of Other Comprehensive Income Expected to Be Reflected in Pension Expense in Next Year | The portion of other comprehensive income that is expected to be reflected in pension expense in 2019 is as follows: Amortization of prior service cost $ 631 Amortization of net actuarial loss 7,580 Total $ 8,211 |
Pension Benefits | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Weighted Average Assumptions | Weighted Average Pension Plan Assumptions For Benefit Obligations at December 31: 2018 2017 Discount rate 4.37 % 3.75 % Rate of compensation increase 4.00 4.37 For Periodic Benefit Cost for the Year: 2018 2017 2016 Discount rate 3.75 % 4.27 % 4.64 % Expected long-term returns 6.72 6.96 7.19 Rate of compensation increase 4.37 4.31 4.33 |
Components of Net Periodic Pension Costs and Post-Retirement Benefit Costs | Net periodic benefit cost for the defined benefit plans by expense component was as follows: Year Ended December 31, 2018 2017 2016 Service cost—benefits earned during the period $ 21,092 $ 17,942 $ 15,502 Interest cost on projected benefit obligation 22,303 22,124 21,631 Expected return on assets (25,547 ) (23,597 ) (23,127 ) Net amortization 15,003 12,281 10,135 Recognition of actuarial loss (258 ) 78 61 Net periodic benefit cost $ 32,593 $ 28,828 $ 24,202 |
Reconciliation of Benefit Obligation and Plan Assets | The following table presents a reconciliation from the beginning to the end of the year of the PBO and plan assets for the defined benefit plans and SERP. This table also presents the amounts previously recognized as a component of accumulated other comprehensive income. Pension Benefits Year Ended December 31, 2018 2017 Changes in PBO: PBO at beginning of year $ 602,606 $ 527,522 Service cost 21,092 17,942 Interest cost 22,303 22,124 Plan amendments 2,377 — Actuarial loss (gain) (67,270 ) 55,369 Benefits paid (24,909 ) (20,351 ) PBO at end of year 556,199 602,606 Changes in plan assets: Fair value at beginning of year 377,624 328,871 Return on assets (12,824 ) 47,832 Contributions 52,781 21,272 Benefits paid (24,909 ) (20,351 ) Fair value at end of year 392,672 377,624 Funded status at year end $ (163,527 ) $ (224,982 ) |
Schedule of Amounts Recognized as Components Accumulated Other Comprehensive Income | Amounts recognized in accumulated other comprehensive income consist of: Net loss (gain) $ 143,453 $ 186,563 Prior service cost 5,976 4,135 Net amounts recognized at year end $ 149,429 $ 190,698 |
Estimated Future Payments for Post-Retirement Benefit Plans | Torchmark has estimated its expected pension benefits to be paid over the next ten years as of December 31, 2018 . These estimates use the same assumptions that measure the benefit obligation at December 31, 2018 , taking estimated future employee service into account. Those estimated benefits are as follows: For the year(s): 2019 $ 21,442 2020 23,159 2021 24,806 2022 26,847 2023 28,661 2024-2028 167,177 |
Supplemental Disclosures of C_2
Supplemental Disclosures of Cash Flow Information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Supplemental Cash Flow Elements [Abstract] | |
Summary of Noncash Transactions | The following table summarizes Torchmark’s noncash transactions, which are not reflected on the Consolidated Statements of Cash Flows: Year Ended December 31, 2018 2017 2016 Stock-based compensation not involving cash $ 39,792 $ 37,034 $ 26,326 Commitments for low-income housing interests 50,883 33,846 56,818 Exchanges of fixed maturity investments 193,449 84,312 224,901 Net unsettled security trades 39,851 — 15,020 |
Summary of Amounts Paid | The following table summarizes certain amounts paid during the period: Year Ended December 31, 2018 2017 2016 Interest paid $ 83,518 $ 82,494 $ 81,338 Income taxes paid 91,510 74,379 79,790 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Selected Information about Debt Issues | The following table presents information about the terms and outstanding balances of Torchmark’s debt. Selected Information about Debt Issues As of December 31, 2018 2017 Annual Interest Rate Issue Date Periodic Interest Payments Due Outstanding Principal (Par Value) Outstanding Principal (Book Value) Outstanding Principal (Fair Value) Outstanding Principal (Book Value) Long-term debt: Notes, due 5/15/23 (3,5) 7.875 % 5/93 5/15 & 11/15 $ 165,612 $ 164,490 $ 192,945 $ 164,284 Senior Notes, due 6/15/19 (3,14) 9.250 % 6/09 6/15 & 12/15 — — — 291,888 Senior Notes, due 9/15/22 (3,7) 3.800 % 9/12 3/15 & 9/15 150,000 148,777 150,481 148,477 Senior Notes, due 9/15/28 (3,7) 4.550 % 9/18 3/15 & 9/15 550,000 543,169 558,825 — Junior Subordinated Debentures due 3/15/36 (4,11,15) — % (12) (10) quarterly — — — 20,000 Junior Subordinated Debentures due 6/15/56 (4,8,11) 6.125 % 4/16 quarterly 300,000 290,520 301,200 290,460 Junior Subordinated Debentures due 11/17/57 (4,9) 5.275 % 11/17 6/15 & 12/15 125,000 123,354 94,129 123,342 Term loan due 5/17/21 (1,6) 3.595 % (13) 6/16 monthly 93,750 93,750 93,750 98,125 1,384,362 1,364,060 1,391,330 1,136,576 Less current maturity of term loan 6,875 6,875 6,875 4,375 Total long-term debt 1,377,487 1,357,185 1,384,455 1,132,201 Short-term debt: Current maturity of term loan 6,875 6,875 6,875 4,375 Commercial paper (2) 302,100 300,973 300,973 323,692 Total short-term debt 308,975 307,848 307,848 328,067 Total debt $ 1,686,462 $ 1,665,033 $ 1,692,303 $ 1,460,268 (1) The term loan has higher priority than all other debt issues. (2) Commercial paper has priority over all other debt except the term loan. (3) All securities, other than the term loan, commercial paper and Junior Subordinated Debentures have equal priority with one another. (4) All Junior Subordinated Debentures have equal priority, but are subordinate to all other issues. (5) Not callable. (6) Callable anytime. (7) Callable subject to “make-whole” premium. (8) Callable at any time on or after June15, 2021, and prior to this date upon the occurrence of a Tax Event or Rating Agency Event. (9) Callable at any time on or after November 17, 2022, and prior to this date upon the occurrence of a Tax Event or Rating Agency Event. (10) Assumed upon November 1, 2012 acquisition of Family Heritage. (11) Quarterly payments on the 15th of March, June, September, and December. (12) Interest paid at 3 Month LIBOR plus 330 basis points, resets each quarter. (13) Interest paid at 1 Month LIBOR plus 125 basis points, resets each month. (14) Redeemed on October 29, 2018. (15) Redeemed on June 15, 2018. |
Schedule of Maturities of Long-term Debt | The following table presents expected scheduled principal payments under our contractual debt obligations: Year Ended December 31, 2019 2020 2021 2022 2023 Thereafter Debt obligations $ 308,975 $ 9,375 $ 77,500 $ 150,000 $ 165,612 $ 975,000 |
Short-Term Borrowings | Credit Facility - Commercial Paper At December 31, 2018 2017 Balance at end of period (at par value) $ 302,100 $ 324,250 Annualized interest rate 2.93 % 1.78 % Letters of credit outstanding $ 155,000 $ 177,000 Remaining amount available under credit line $ 292,900 $ 248,750 Year Ended December 31, 2018 2017 2016 Average balance outstanding during period $ 368,228 $ 323,429 $ 301,550 Daily-weighted average interest rate (annualized) 2.40 % 1.30 % 0.83 % Maximum daily amount outstanding during period $ 525,990 $ 455,912 $ 412,676 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Summary of Preferred and Common Share Activity | A summary of common share activity is presented in the following chart. Common Stock Issued Treasury Stock 2016: Balance at January 1, 2016 130,218,183 (7,848,231 ) Grants of restricted stock — 12,549 Vesting of performance shares — 159,020 Issuance of common stock due to exercise of stock options — 2,184,169 Treasury stock acquired — (6,694,582 ) Retirement of treasury stock (3,000,000 ) 3,000,000 Balance at December 31, 2016 127,218,183 (9,187,075 ) 2017: Grants of restricted stock — 9,135 Vesting of performance shares — 119,896 Issuance of common stock due to exercise of stock options — 1,661,808 Treasury stock acquired — (5,228,868 ) Retirement of treasury stock (3,000,000 ) 3,000,000 Balance at December 31, 2017 124,218,183 (9,625,104 ) 2018: Grants of restricted stock — 10,805 Forfeitures of restricted stock (7,500 ) Vesting of performance shares — 149,898 Issuance of common stock due to exercise of stock options — 897,622 Treasury stock acquired — (4,950,868 ) Retirement of treasury stock (3,000,000 ) 3,000,000 Balance at December 31, 2018 121,218,183 (10,525,147 ) |
Acquisition of Common Shares | See the following summary below: Torchmark Share Repurchase Program Share Repurchase for Dilution Purposes Shares Acquired Total Cost Average Price Shares Acquired Total Cost Average Price 2018 4,406 $ 371,794 $ 84.38 571 $ 49,955 $ 87.54 2017 4,126 324,622 78.67 1,103 88,367 80.15 2016 5,208 311,332 59.78 1,487 93,452 62.87 |
Reconciliation of Basic and Diluted Weighted Average Shares Outstanding | A reconciliation of basic and diluted weighted-average shares outstanding used in the computation of basic and diluted earnings per share is as follows: Year Ended December 31, 2018 2017 2016 Basic weighted average shares outstanding 112,872,581 116,342,529 120,001,191 Weighted average dilutive options outstanding 2,376,372 2,640,965 2,366,594 Diluted weighted average shares outstanding 115,248,953 118,983,494 122,367,785 Antidilutive shares 1,161,521 — — |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Grant Contract Periods and Vesting Periods | Options generally vest in accordance with the following schedule: Shares vested by period Contract Period 6 Months Year 1 Year 2 Year 3 Year 4 Year 5 Directors 7 years 100% —% —% —% —% —% Employees 7 years —% —% 50% 50% —% —% Employees 10 years —% —% 25% 25% 25% 25% |
Analysis of Shares Available for Grant | An analysis of shares available for grant is as follows: Available for Grant 2018 2017 2016 Balance at January 1, 2,964,320 5,088,461 6,872,282 Approval of Torchmark Corporation 2018 Incentive Plan (1) 8,984,000 — — Cancellation of available shares from prior plans (184,000 ) — — Options expired and forfeited during year (2) 41,317 26,488 8,518 Restricted stock expired and forfeited during year (3) — 46,500 — Options granted during year (2) (1,262,037 ) (1,328,513 ) (1,306,306 ) Restricted stock, restricted stock units, and performance shares granted under the Torchmark Corporation 2011 Incentive Plans (3) (1,120,840 ) (868,616 ) (486,033 ) Balance at December 31, 9,422,760 2,964,320 5,088,461 (1) See plan document referenced in Exhibits . (2) Plan allows for grant of options such that each grant reduces shares available for grant in a range from 0.85 share to 1 share. (3) Plan allows for grant of restricted stock such that each stock grant reduces shares available for grant in a range from 3.1 shares to 3.88 shares. |
Summary of Stock Compensation Activity | Selected stock option activity for the three years ended December 31, 2018 is presented below: 2018 2017 2016 Weighted-average grant-date fair value of options granted $ 15.65 $ 12.88 $ 9.04 Intrinsic value of options exercised 42,517 70,948 73,995 Cash received from options exercised 36,091 61,215 61,329 Actual tax benefit received 8,929 24,832 25,898 A summary of stock compensation activity for each of the three years ended December 31, 2018 is presented below: 2018 2017 2016 Stock-based compensation expense recognized (1) $ 39,792 $ 37,034 $ 26,326 Tax benefit recognized 14,806 32,511 27,867 (1) No stock-based compensation expense was capitalized in any period. |
Schedule of Additional Information of Stock-Based Compensation | Additional stock compensation information is as follows at December 31: 2018 2017 Unrecognized compensation (1) $ 38,627 $ 31,309 Weighted average period of expected recognition (in years) (1) 0.81 0.86 (1) Includes restricted stock and performance shares. Additional information about Torchmark’s stock option activity as of December 31, 2018 and 2017 is as follows: 2018 2017 Outstanding options: Weighted-average remaining contractual term (in years) 4.77 4.89 Aggregate intrinsic value $ 114,161 $ 231,277 Exercisable options: Weighted-average remaining contractual term (in years) 2.89 2.99 Aggregate intrinsic value $ 89,817 $ 137,424 |
Summary of Options Outstanding | The following table summarizes information about stock options outstanding at December 31, 2018 . Options Outstanding Options Exercisable Range of Number Outstanding Weighted- Average Remaining Contractual Life (Years) Weighted- Average Exercise Price Number Exercisable Weighted- Average Exercise Price $29.59 - $37.40 909,471 1.57 $ 36.21 909,471 $ 36.21 50.64 1,308,101 5.38 50.64 467,288 50.64 50.69 - 51.62 920,372 2.66 50.70 859,552 50.70 53.61 - 56.32 1,251,337 3.60 53.66 1,117,163 53.66 73.92 - 77.26 1,439,081 6.19 77.24 10,843 74.29 83.17 - 90.21 1,375,403 7.31 87.62 28,773 88.44 $29.59 - $90.21 7,203,765 4.77 $ 61.72 3,393,090 $ 48.18 |
Analysis of Option Activity | An analysis of option activity for each of the three years ended December 31, 2018 is as follows: 2018 2017 2016 Options Weighted Average Exercise Price Options Weighted Average Exercise Price Options Weighted Average Exercise Price Outstanding—beginning of year 6,753,801 $ 53.59 6,973,591 $ 44.64 7,734,841 $ 38.84 Granted: 7-year term 845,773 87.63 933,286 77.19 834,212 50.78 10-year term 543,130 87.60 535,220 77.26 597,225 50.64 Exercised (897,622 ) 40.21 (1,661,808 ) 36.84 (2,184,169 ) 28.08 Expired and forfeited (41,317 ) 70.90 (26,488 ) 57.94 (8,518 ) 39.35 Outstanding—end of year 7,203,765 $ 61.72 6,753,801 $ 53.59 6,973,591 $ 44.64 Exercisable at end of year 3,393,090 $ 48.18 2,928,979 $ 43.79 3,115,847 $ 36.81 |
Schedule Of Restricted Stock Units Outstanding And Vested | Below are the following restricted stock units outstanding for each of the three years ended 2018 . All restricted stock units were fully vested at the end of each year of grant. Year of grants Outstanding as of year end 2016 112,591 2017 120,326 2018 102,116 |
Schedule of Additional Information on Unvested Options | Additional information concerning Torchmark’s unvested options is as follows at December 31: 2018 2017 Number of shares outstanding 3,810,675 3,824,822 Weighted-average exercise price (per share) $ 73.78 $ 61.10 Weighted-average remaining contractual term (in years) 6.45 6.34 Aggregate intrinsic value $ 24,344 $ 113,246 |
Schedule of Performance Shares Settled | Below is the final determination of the performance share grants in 2014 to 2016 : Year of grants Final settlement of shares Final settlement date 2014 119,896 February 21, 2017 2015 149,898 February 27, 2018 2016 311,399 February 28, 2019 |
Summary of Restricted Stock and Restricted Stock Units Granted | A summary of restricted stock grants for each of the years in the three-year period ended December 31, 2018 is presented in the table below. 2018 2017 2016 Directors restricted stock: Shares 10,805 9,135 12,549 Price per share $ 88.19 $ 73.92 $ 57.39 Aggregate value $ 953 $ 675 $ 720 Percent vested as of 12/31/18 100 % 100 % 85 % Directors restricted stock units (including dividend equivalents): Shares 7,688 7,735 6,912 Price per share $ 89.15 $ 74.45 $ 56.74 Aggregate value $ 685 $ 576 $ 392 Percent vested as of 12/31/18 100 % 100 % 100 % Performance shares: Target shares 159,000 153,000 167,500 Target price per share $ 87.60 $ 77.26 $ 50.64 Assumed adjustment for performance objectives (in shares) 179,415 106,084 (35,073 ) Aggregate value $ 13,928 $ 11,821 $ 8,482 Percent vested as of 12/31/18 — % — % — % |
Analysis of Unvested Restricted Stock | An analysis of unvested restricted stock is as follows: Executive Executive Directors Directors Total 2016: Balance at January 1, 2016 187,665 459,017 — — 646,682 Grants — 167,500 12,549 6,912 186,961 Additional performance shares (1) — (35,073 ) — — (35,073 ) Restriction lapses (130,215 ) (159,020 ) (10,655 ) (6,912 ) (306,802 ) Forfeitures — — — — — Balance at December 31, 2016 57,450 432,424 1,894 — 491,768 2017: Grants — 153,000 9,135 7,735 169,870 Additional performance shares (1) — 106,084 — — 106,084 Restriction lapses (14,700 ) (119,896 ) (11,029 ) (7,735 ) (153,360 ) Forfeitures (7,500 ) (7,500 ) — — (15,000 ) Balance at December 31, 2017 35,250 564,112 — — 599,362 2018: Grants — 159,000 10,805 7,688 177,493 Additional performance shares (1) — 179,415 — — 179,415 Restriction lapses (23,250 ) (149,898 ) (10,805 ) (7,688 ) (191,641 ) Forfeitures — — — — — Balance at December 31, 2018 12,000 752,629 — — 764,629 (1) Estimated additional (reduced) share grants expected due to achievement of performance criteria. |
Schedule of Weighted-Average Grant-Date Fair Values of Unvested Restricted Stock | An analysis of the weighted-average grant-date fair values per share of unvested restricted stock is as follows for the year 2018 : Executive Restricted Stock Executive Performance Shares Directors Restricted Stock Directors Restricted Stock Units Grant-date fair value per share at January 1, 2018 $ 41.93 $ 56.64 $ — $ — Grants — 87.60 88.19 89.33 Estimated additional performance shares — 70.39 — — Restriction lapses (37.40 ) (53.61 ) (88.19 ) (89.33 ) Forfeitures — — — — Grant-date fair value per share at December 31, 2018 50.69 67.06 — — |
Business Segments (Tables)
Business Segments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Segment Premium Revenue by Each Marketing Group | The tables below present segment premium revenue by each of Torchmark’s distribution channels. Torchmark Corporation Premium Income by Distribution Channel For the Year 2018 Life Health Annuity Total Distribution Channel Amount % of Total Amount % of Total Amount % of Total Amount % of Total American Income Exclusive $ 1,081,333 45 $ 93,313 9 $ — — $ 1,174,646 34 Direct Response 828,935 34 76,297 7 — — 905,232 26 Liberty National Exclusive 278,878 12 191,378 19 — — 470,256 14 United American Independent 11,451 1 381,076 38 12 100 392,539 12 Family Heritage Exclusive 3,501 — 273,275 27 — — 276,776 8 Other 202,457 8 — — — — 202,457 6 $ 2,406,555 100 $ 1,015,339 100 $ 12 100 $ 3,421,906 100 For the Year 2017 Life Health Annuity Total Distribution Channel Amount % of Total Amount % of Total Amount % of Total Amount % of Total American Income Exclusive $ 999,279 43 $ 89,036 9 $ — — $ 1,088,315 33 Direct Response 812,907 35 73,468 8 — — 886,375 27 Liberty National Exclusive 274,635 12 196,207 20 — — 470,842 14 United American Independent 12,547 1 364,128 37 15 100 376,690 12 Family Heritage Exclusive 3,193 — 253,534 26 — — 256,727 8 Other 203,986 9 — — — — 203,986 6 $ 2,306,547 100 $ 976,373 100 $ 15 100 $ 3,282,935 100 For the Year 2016 Life Health Annuity Total Distribution Channel Amount % of Total Amount % of Total Amount % of Total Amount % of Total American Income Exclusive $ 913,355 42 $ 84,382 9 $ — — $ 997,737 32 Direct Response 782,765 36 70,393 7 — — 853,158 27 Liberty National Exclusive 270,476 12 201,798 21 — — 472,274 15 United American Independent 13,733 1 355,015 38 38 100 368,786 12 Family Heritage Exclusive 2,866 — 236,075 25 — — 238,941 8 Other 206,138 9 — — — — 206,138 6 $ 2,189,333 100 $ 947,663 100 $ 38 100 $ 3,137,034 100 |
Reconciliation of Segment Operating Information to Consolidated Statement of Operations | The following tables set forth a reconciliation of Torchmark’s revenues and operations by segment to its major income statement line items. See Note 1—Significant Accounting Policies for additional information concerning reconciling items of segment profits to pretax income. For the year 2018 Life Health Annuity Investment Corporate & Other Adjustments Consolidated Revenue: Premium $ 2,406,555 $ 1,015,339 $ 12 $ — $ — $ — $ 3,421,906 Net investment income — — — 882,512 — — 882,512 Other income — — — — 1,236 (99 ) (2) 1,137 Total revenue 2,406,555 1,015,339 12 882,512 1,236 (99 ) 4,305,555 Expenses: Policy benefits 1,591,790 649,188 34,264 — — — 2,275,242 Required interest on reserves (636,040 ) (83,243 ) (47,357 ) 766,640 — — — Required interest on deferred acquisition costs 194,297 24,412 589 (219,298 ) — — — Amortization of acquisition costs 414,200 100,376 2,114 — — — 516,690 Commissions, premium taxes, and non-deferred acquisition costs 190,007 88,553 26 — — (99 ) (2) 278,487 Insurance administrative expense (1) — — — — 223,941 3,590 (3) 227,531 Parent expense — — — — 10,684 1,578 (4) 12,262 Stock-based compensation expense — — — — 39,792 — 39,792 Interest expense — — — 90,076 — — 90,076 Total expenses 1,754,254 779,286 (10,364 ) 637,418 274,417 5,069 3,440,080 Subtotal 652,301 236,053 10,376 245,094 (273,181 ) (5,168 ) 865,475 Non-operating items — — — — — 5,168 (3,4) 5,168 Measure of segment profitability (pretax) $ 652,301 $ 236,053 $ 10,376 $ 245,094 $ (273,181 ) $ — 870,643 Realized gain (loss)—investments 9,274 Realized loss — redemption of debt (11,078 ) Administrative settlements (3,590 ) Non-operating fees (1,578 ) Income before income taxes per Consolidated Statement of Operations $ 863,671 (1) Administrative expense is not allocated to insurance segments. (2) Elimination of intersegment commission. (3) In 2018 , the Company recorded $3.6 million in administrative settlements related to state regulatory examinations. These administrative settlements were included in "Policyholder benefits" in the Consolidated Statements of Operations . (4) Non-operating fees. For the year 2017 Life Health Annuity Investment Corporate & Other Adjustments Consolidated Revenue: Premium $ 2,306,547 $ 976,373 $ 15 $ — $ — $ — $ 3,282,935 Net investment income — — — 847,885 — — 847,885 Other income — — — — 1,270 (128 ) (2) 1,142 Total revenue 2,306,547 976,373 15 847,885 1,270 (128 ) 4,131,962 Expenses: Policy benefits 1,549,602 628,640 35,836 — — 13,797 (3,4) 2,227,875 Required interest on reserves (607,007 ) (77,792 ) (49,571 ) 734,370 — — — Required interest on deferred acquisition costs 186,236 23,454 690 (210,380 ) — — — Amortization of acquisition costs 396,268 96,519 2,466 — — (4,850 ) (4) 490,403 Commissions, premium taxes, and non-deferred acquisition costs 177,111 86,044 32 — — 1,673 (2,5) 264,860 Insurance administrative expense (1) — — — — 210,590 — 210,590 Parent expense — — — — 9,631 — 9,631 Stock-based compensation expense — — — — 33,654 3,380 (6) 37,034 Interest expense — — — 84,532 — — 84,532 Total expenses 1,702,210 756,865 (10,547 ) 608,522 253,875 14,000 3,324,925 Subtotal 604,337 219,508 10,562 239,363 (252,605 ) (14,128 ) 807,037 Non-operating items — — — — — 14,128 (3,4,5,6) 14,128 Measure of segment profitability (pretax) $ 604,337 $ 219,508 $ 10,562 $ 239,363 $ (252,605 ) $ — 821,165 Realized gain (loss)—investments 27,652 Realized loss — redemption of debt (4,041 ) Administrative settlements (8,659 ) Non-operating fees (288 ) Guaranty fund assessments (1,801 ) Stock-based compensation expense—Tax reform adjustment (3,380 ) Income before income taxes per Consolidated Statement of Operations 830,648 (1) Administrative expense is not allocated to insurance segments. (2) Elimination of intersegment commission. (3) In 2017 , the Company recorded $8.7 million ( $5.6 million , net of tax) in administrative settlements where claims were not properly filed or information to support the validity of the claim had not been properly submitted. These administrative settlements were included in "Policyholder benefits" in the Consolidated Statements of Operations . (4) Non-operating fees. (5) In 2017 , the Company recorded $1.8 million ( $1.2 million , net of tax) in unrecoverable guaranty fund assessments. See Note 6—Commitment and Contingencies for further discussion. (6) The Company increased stock-based compensation expense by $3.4 million ( $2.2 million , net of tax) due to the impact of the tax rate change on certain performance-based equity awards. For the Year 2016 Life Health Annuity Investment Corporate & Other Adjustments Consolidated Revenue: Premium $ 2,189,333 $ 947,663 $ 38 $ — $ — $ — $ 3,137,034 Net investment income — — — 806,903 — — 806,903 Other income — — — — 1,534 (159 ) (2) 1,375 Total revenue 2,189,333 947,663 38 806,903 1,534 (159 ) 3,945,312 Expenses: Policy benefits 1,475,477 612,725 36,751 — — 3,795 (3) 2,128,748 Required interest on reserves (577,827 ) (73,382 ) (51,131 ) 702,340 — — — Required interest on deferred acquisition costs 178,946 23,060 807 (202,813 ) — — — Amortization of acquisition costs 374,499 90,385 4,179 — — — 469,063 Commissions, premium taxes, and non-deferred acquisition costs 164,476 84,819 38 — — (159 ) (2) 249,174 Insurance administrative expense (1) — — — — 196,598 553 (4) 197,151 Parent expense — — — — 8,587 — 8,587 Stock-based compensation expense — — — — 26,326 — 26,326 Interest expense — — — 83,345 — — 83,345 Total expenses 1,615,571 737,607 (9,356 ) 582,872 231,511 4,189 3,162,394 Subtotal 573,762 210,056 9,394 224,031 (229,977 ) (4,348 ) 782,918 Non-operating items — — — — — 4,348 '(3,4) 4,348 Measure of segment profitability (pretax) $ 573,762 $ 210,056 $ 9,394 $ 224,031 $ (229,977 ) $ — 787,266 Realized gain (loss)—investments (10,683 ) Administrative settlements (3,795 ) Non-operating fees (553 ) Income before income taxes per Consolidated Statement of Operations $ 772,235 (1) Administrative expense is not allocated to insurance segments. (2) Elimination of intersegment commission. (3) In 2016 , the Company recorded $3.8 million in administrative settlements related to benefits paid for deaths occurring in prior years where claims had not been filed. These administrative settlements were included in "Policyholder benefits" in the Consolidated Statements of Operations . |
Assets by Segment | The table below reconciles segment assets to total assets as reported in the consolidated financial statements. Assets by Segment At December 31, 2018 Life Health Annuity Investment Other Consolidated Cash and invested assets $ — $ — $ — $ 17,239,570 $ — $ 17,239,570 Accrued investment income — — — 243,003 — 243,003 Deferred acquisition costs 3,580,693 548,640 8,592 — — 4,137,925 Goodwill 309,609 131,982 — — — 441,591 Other assets — — — — 1,033,633 1,033,633 Total assets $ 3,890,302 $ 680,622 $ 8,592 $ 17,482,573 $ 1,033,633 $ 23,095,722 At December 31, 2017 Life Health Annuity Investment Other Consolidated Cash and invested assets $ — $ — $ — $ 17,853,047 $ — $ 17,853,047 Accrued investment income — — — 233,453 — 233,453 Deferred acquisition costs 3,423,296 529,068 5,699 — — 3,958,063 Goodwill 309,609 131,982 — — — 441,591 Other assets — — — — 988,831 988,831 Total assets $ 3,732,905 $ 661,050 $ 5,699 $ 18,086,500 $ 988,831 $ 23,474,985 |
Other Balances by Segment | Liabilities by Segment At December 31, 2018 Life Health Annuity Investment Other Consolidated Future policy benefits $ 10,847,356 $ 1,927,732 $ 1,178,738 $ — $ — $ 13,953,826 Unearned and advance premiums 17,850 43,358 — — — 61,208 Policy claims and other benefits payable 196,298 154,528 — — — 350,826 Debt — — — 1,665,033 — 1,665,033 Other — — — — 1,649,652 1,649,652 Total liabilities $ 11,061,504 $ 2,125,618 $ 1,178,738 $ 1,665,033 $ 1,649,652 $ 17,680,545 At December 31, 2017 Life Health Annuity Investment Other Consolidated Future policy benefits $ 10,353,286 $ 1,831,338 $ 1,254,848 $ — $ — $ 13,439,472 Unearned and advance premiums 16,927 44,503 — — — 61,430 Policy claims and other benefits payable 186,429 146,865 — — — 333,294 Debt — — — 1,460,268 — 1,460,268 Other — — — — 1,949,100 1,949,100 Total liabilities $ 10,556,642 $ 2,022,706 $ 1,254,848 $ 1,460,268 $ 1,949,100 $ 17,243,564 |
Selected Quarterly Data (Unau_2
Selected Quarterly Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Selected Quarterly Data | The following is an unaudited summary of quarterly results for the two years ended December 31, 2018 . The information includes all adjustments (consisting of normal accruals) which management considers necessary for a fair presentation of the results of operations for these periods. Three Months Ended March 31, June 30, September 30, December 31, 2018: Premium income $ 850,106 $ 853,979 $ 860,750 $ 857,071 Net investment income 218,084 218,568 221,627 224,233 Realized gains (losses) 1,951 11,813 1,032 (16,600 ) Total revenue 1,070,436 1,084,776 1,083,802 1,064,737 Policyholder benefits 569,889 568,377 567,856 569,120 Amortization of deferred acquisition costs 129,620 129,077 129,492 128,501 Pretax income from continuing operations 212,842 226,864 220,330 203,635 Income from continuing operations 173,711 184,393 178,700 164,706 Income (loss) from discontinued operations (111 ) 32 24 11 Net income 173,600 184,425 178,724 164,717 Basic net income per common share: Continuing operations 1.52 1.63 1.59 1.48 Discontinued operations — — — — Total basic net income per common share 1.52 1.63 1.59 1.48 Diluted net income per common share: Continuing operations 1.49 1.59 1.55 1.45 Discontinued operations — — — — Total diluted net income per common share 1.49 1.59 1.55 1.45 Three Months Ended March 31, June 30, September 30, December 31, 2017: Premium income $ 820,631 $ 816,614 $ 819,217 $ 826,473 Net investment income 208,282 212,776 213,872 212,955 Realized gains (losses) (5,748 ) (705 ) 12,595 17,469 Total revenue 1,023,581 1,029,078 1,046,015 1,056,899 Policyholder benefits 557,776 556,415 551,219 562,465 Amortization of deferred acquisition costs 125,908 122,121 122,334 120,040 Pretax income from continuing operations 191,741 201,926 220,610 216,371 Income from continuing operations 137,178 140,363 153,346 1,027,376 Income from discontinued operations (3,637 ) (90 ) (12 ) (30 ) Net income 133,541 140,273 153,334 1,027,346 Basic net income per common share: Continuing operations 1.16 1.20 1.32 8.93 Discontinued operations (0.03 ) — — — Total basic net income per common share 1.13 1.20 1.32 8.93 Diluted net income per common share: Continuing operations 1.14 1.18 1.29 8.71 Discontinued operations (0.03 ) — — — Total diluted net income per common share 1.11 1.18 1.29 8.71 |
Significant Accounting Polici_4
Significant Accounting Policies - Additional Information (Detail) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018USD ($) | Dec. 31, 2018USD ($)segment | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Significant Accounting Policies [Line Items] | ||||
Number of reportable segments | segment | 4 | |||
Percentage of investment securities not classified as corporate securities, state and municipal securities, redeemable preferred stocks and U.S. government securities (less than) | 2.00% | 2.00% | ||
Fair value determined by third party | 95.00% | 95.00% | ||
Advanced agent commissions receivable | $ 396,000 | $ 396,000 | $ 378,000 | |
Advertising costs charged to earnings and included in other operating expense | 9,000 | 9,300 | $ 9,300 | |
Capitalized advertising costs | 1,300,000 | 1,300,000 | 1,300,000 | |
Carrying value of investment in low-income housing interests | 226,000 | 226,000 | 228,000 | |
Obligations under future commitments for low-income housing interests | 51,000 | 51,000 | ||
Original cost of property and equipment | 256,000 | 256,000 | 217,000 | |
Accumulated depreciation | 121,000 | 121,000 | 109,000 | |
Depreciation expense | $ 13,000 | 11,000 | 10,000 | |
Traditional life and health, interest rate, low end | 2.50% | |||
Traditional life and health, interest rate, high end | 7.00% | |||
Traditional life and health, weighted average interest rate | 5.70% | |||
Tax benefit as the result of a lower corporate tax rate | $ 874,000 | |||
Tax Reform adjustment | $ 798 | 798 | 877,400 | 0 |
Insurance policy charges | $ 16,400 | $ 17,000 | $ 18,300 | |
Term over which monthly data points are used to derive volatility | 3 years | |||
Minimum | Equipment | ||||
Significant Accounting Policies [Line Items] | ||||
Property and equipment, estimated useful life | 3 years | |||
Minimum | Building and Improvements | ||||
Significant Accounting Policies [Line Items] | ||||
Property and equipment, estimated useful life | 10 years | |||
Maximum | Equipment | ||||
Significant Accounting Policies [Line Items] | ||||
Property and equipment, estimated useful life | 5 years | |||
Maximum | Building and Improvements | ||||
Significant Accounting Policies [Line Items] | ||||
Property and equipment, estimated useful life | 40 years | |||
Life insurance | ||||
Significant Accounting Policies [Line Items] | ||||
Proportion of future policy reserves which are not universal life type | 88.00% | |||
Employee | Equity Option | 5 Year Vesting Period | Torchmark Corporation 2011 Incentive Plan | ||||
Significant Accounting Policies [Line Items] | ||||
Option grants contractual term | 10 years | |||
Vesting period | 5 years | |||
Employee | Equity Option | 3 Year Vesting Period | Torchmark Corporation 2011 Incentive Plan | ||||
Significant Accounting Policies [Line Items] | ||||
Option grants contractual term | 7 years | |||
Vesting period | 3 years | |||
Director | Equity Option | Torchmark Corporation 2011 Incentive Plan | ||||
Significant Accounting Policies [Line Items] | ||||
Vesting period | 6 months |
Significant Accounting Polici_5
Significant Accounting Policies - Summary of Assumptions for Options Granted (Detail) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | |||
Volatility factor | 13.70% | 14.80% | 19.20% |
Dividend yield | 0.70% | 0.70% | 1.10% |
Expected term (in years) | 5 years 9 months 4 days | 5 years 8 months 16 days | 5 years 9 months 11 days |
Risk-free rate | 2.70% | 2.00% | 1.30% |
Significant Accounting Polici_6
Significant Accounting Policies - Accounting Pronouncements Adopted in the Current Year (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Retained earnings | $ 5,213,468 | $ 4,806,208 | |
Limited partnerships, fair value | 399 | ||
ASU 2016-01 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Retained earnings | $ 4,900 | ||
ASU 2017-07 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Additional expense due to elimination of the ability to capitalize a portion of the benefit costs | 3,100 | ||
Investment in limited partnerships | Partnership Interest - Fair Value Option | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Limited partnerships, fair value | $ 108,241 | $ 0 |
Statutory Accounting - Consolid
Statutory Accounting - Consolidated Net Income and Shareholders' Equity for Insurance Companies (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Insurance [Abstract] | |||
Life insurance subsidiaries, Net income | $ 437,549 | $ 426,285 | $ 429,563 |
Life insurance subsidiaries, Shareholders' equity | $ 1,443,156 | $ 1,254,875 |
Statutory Accounting - Addition
Statutory Accounting - Additional Information (Detail) $ in Millions | Dec. 31, 2018USD ($) |
Insurance [Abstract] | |
Surplus adequate to satisfy regulatory compliance | $ 499 |
Supplemental Information abou_3
Supplemental Information about Changes to Accumulated Other Comprehensive Income - Schedule of Change in Balance by Component of Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Increase (Decrease) in AOCI, Net of Tax | |||
Beginning balance | $ 6,231,421 | $ 4,566,861 | $ 4,055,552 |
Reclassifications, net of tax | 10,536 | (14,668) | 10,574 |
Ending balance | 5,415,177 | 6,231,421 | 4,566,861 |
Total [Member] | |||
Increase (Decrease) in AOCI, Net of Tax | |||
Beginning balance | 1,424,274 | 577,574 | 231,947 |
Other comprehensive income (loss) before reclassifications, net of tax | (1,115,335) | 608,968 | 335,053 |
Reclassifications, net of tax | 10,536 | (14,668) | 10,574 |
Other comprehensive income (loss) | (1,104,799) | 594,300 | 345,627 |
Reclassifications, Tax Reform | 252,400 | ||
Ending balance | 319,475 | 1,424,274 | 577,574 |
Available for Sale Assets | |||
Increase (Decrease) in AOCI, Net of Tax | |||
Beginning balance | 1,569,289 | 692,314 | 332,333 |
Other comprehensive income (loss) before reclassifications, net of tax | (1,132,202) | 621,619 | 356,016 |
Reclassifications, net of tax | (1,389) | (22,751) | 3,965 |
Other comprehensive income (loss) | (1,133,591) | 598,868 | 359,981 |
Reclassifications, Tax Reform | 278,107 | ||
Ending balance | 435,698 | 1,569,289 | 692,314 |
Deferred Acquisition Costs | |||
Increase (Decrease) in AOCI, Net of Tax | |||
Beginning balance | (8,547) | (6,682) | (5,115) |
Other comprehensive income (loss) before reclassifications, net of tax | 4,384 | (350) | (1,567) |
Reclassifications, net of tax | 0 | 0 | 0 |
Other comprehensive income (loss) | 4,384 | (350) | (1,567) |
Reclassifications, Tax Reform | (1,515) | ||
Ending balance | (4,163) | (8,547) | (6,682) |
Foreign Exchange | |||
Increase (Decrease) in AOCI, Net of Tax | |||
Beginning balance | 16,302 | 4,967 | 3,627 |
Other comprehensive income (loss) before reclassifications, net of tax | (9,807) | 8,452 | 1,340 |
Reclassifications, net of tax | 0 | 0 | 0 |
Other comprehensive income (loss) | (9,807) | 8,452 | 1,340 |
Reclassifications, Tax Reform | 2,883 | ||
Ending balance | 6,495 | 16,302 | 4,967 |
Pension Adjustments | |||
Increase (Decrease) in AOCI, Net of Tax | |||
Beginning balance | (152,770) | (113,025) | (98,898) |
Other comprehensive income (loss) before reclassifications, net of tax | 22,290 | (20,753) | (20,736) |
Reclassifications, net of tax | 11,925 | 8,083 | 6,609 |
Other comprehensive income (loss) | 34,215 | (12,670) | (14,127) |
Reclassifications, Tax Reform | (27,075) | ||
Ending balance | $ (118,555) | $ (152,770) | $ (113,025) |
Supplemental Information abou_4
Supplemental Information about Changes to Accumulated Other Comprehensive Income - Summary of Reclassification out of Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||||||||||
Realized gains (losses) | $ 1,804 | $ (23,611) | $ 10,683 | ||||||||
Unrealized gains (losses) on available for sale assets: | |||||||||||
Amortization of (discount) premium | $ (224,233) | $ (221,627) | $ (218,568) | $ (218,084) | $ (212,955) | $ (213,872) | $ (212,776) | $ (208,282) | (882,512) | (847,885) | (806,903) |
Income before income taxes | (203,635) | (220,330) | (226,864) | (212,842) | (216,371) | (220,610) | (201,926) | (191,741) | (863,671) | (830,648) | (772,235) |
Income tax expense from continuing operations | 162,161 | (627,615) | 232,645 | ||||||||
Net income | $ (164,717) | $ (178,724) | $ (184,425) | $ (173,600) | $ (1,027,346) | $ (153,334) | $ (140,273) | $ (133,541) | (701,466) | (1,454,494) | (549,779) |
Pension adjustments: | |||||||||||
Total reclassifications (after tax) | 10,536 | (14,668) | 10,574 | ||||||||
Unrealized Gains (Losses) on Available for Sale Assets | |||||||||||
Pension adjustments: | |||||||||||
Total reclassifications (after tax) | (1,389) | (22,751) | 3,965 | ||||||||
Pension Adjustments, Amortization of Prior Service Cost | |||||||||||
Pension adjustments: | |||||||||||
Total before tax | 535 | 476 | 477 | ||||||||
Pension Adjustments, Amortization of Actuarial (Gain) Loss | |||||||||||
Pension adjustments: | |||||||||||
Total before tax | 14,560 | 11,960 | 9,691 | ||||||||
Pension Adjustments | |||||||||||
Pension adjustments: | |||||||||||
Total before tax | 15,095 | 12,436 | 10,168 | ||||||||
Tax | (3,170) | (4,353) | (3,559) | ||||||||
Total reclassifications (after tax) | 11,925 | 8,083 | 6,609 | ||||||||
Reclassification out of Accumulated Other Comprehensive Income | Unrealized Gains (Losses) on Available for Sale Assets | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||||||||||
Realized gains (losses) | (5,715) | (34,954) | 10,285 | ||||||||
Unrealized gains (losses) on available for sale assets: | |||||||||||
Amortization of (discount) premium | 3,957 | (47) | (4,185) | ||||||||
Income before income taxes | (1,758) | (35,001) | 6,100 | ||||||||
Income tax expense from continuing operations | 369 | 12,250 | (2,135) | ||||||||
Net income | $ (1,389) | $ (22,751) | $ 3,965 |
Investments - Summary of Fixed
Investments - Summary of Fixed Maturities Available for Sale by Component (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturities, available for sale, amortized cost | $ 15,753,471 | $ 14,995,101 |
Gross Unrealized Gains | 972,840 | 2,056,907 |
Gross Unrealized Losses | (428,379) | (82,683) |
Fair Value | $ 16,297,932 | $ 16,969,325 |
Percentage Of Fixed Maturities At Fair Value | 100.00% | 100.00% |
U.S. Government direct, guaranteed, and government-sponsored enterprises | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturities, available for sale, amortized cost | $ 390,351 | $ 390,646 |
Gross Unrealized Gains | 5,104 | 18,173 |
Gross Unrealized Losses | (2,787) | (1,373) |
Fair Value | $ 392,668 | $ 407,446 |
Percentage Of Fixed Maturities At Fair Value | 2.00% | 2.00% |
States, municipalities, and political subdivisions | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturities, available for sale, amortized cost | $ 1,354,810 | $ 1,091,960 |
Gross Unrealized Gains | 83,600 | 127,890 |
Gross Unrealized Losses | (1,750) | (135) |
Fair Value | $ 1,436,660 | $ 1,219,715 |
Percentage Of Fixed Maturities At Fair Value | 9.00% | 7.00% |
Foreign governments | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturities, available for sale, amortized cost | $ 19,006 | $ 20,236 |
Gross Unrealized Gains | 1,810 | 1,782 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | $ 20,816 | $ 22,018 |
Percentage Of Fixed Maturities At Fair Value | 0.00% | 0.00% |
Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturities, available for sale, amortized cost | $ 13,784,681 | $ 13,288,589 |
Gross Unrealized Gains | 858,125 | 1,884,143 |
Gross Unrealized Losses | (416,794) | (73,522) |
Fair Value | $ 14,226,012 | $ 15,099,210 |
Percentage Of Fixed Maturities At Fair Value | 87.00% | 90.00% |
Collateralized debt obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturities, available for sale, amortized cost | $ 57,769 | $ 59,150 |
Gross Unrealized Gains | 22,014 | 20,084 |
Gross Unrealized Losses | (6,414) | (7,653) |
Fair Value | $ 73,369 | $ 71,581 |
Percentage Of Fixed Maturities At Fair Value | 1.00% | 0.00% |
Other asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturities, available for sale, amortized cost | $ 146,854 | $ 144,520 |
Gross Unrealized Gains | 2,187 | 4,835 |
Gross Unrealized Losses | (634) | 0 |
Fair Value | $ 148,407 | $ 149,355 |
Percentage Of Fixed Maturities At Fair Value | 1.00% | 1.00% |
Financial | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturities, available for sale, amortized cost | $ 3,759,768 | $ 3,619,147 |
Gross Unrealized Gains | 262,875 | 538,853 |
Gross Unrealized Losses | (87,515) | (26,119) |
Fair Value | $ 3,935,128 | $ 4,131,881 |
Percentage Of Fixed Maturities At Fair Value | 24.00% | 25.00% |
Utilities | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturities, available for sale, amortized cost | $ 1,989,506 | $ 1,984,290 |
Gross Unrealized Gains | 217,846 | 371,538 |
Gross Unrealized Losses | (24,399) | (1,395) |
Fair Value | $ 2,182,953 | $ 2,354,433 |
Percentage Of Fixed Maturities At Fair Value | 13.00% | 14.00% |
Energy | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturities, available for sale, amortized cost | $ 1,652,700 | $ 1,619,349 |
Gross Unrealized Gains | 93,880 | 226,140 |
Gross Unrealized Losses | (62,371) | (25,392) |
Fair Value | $ 1,684,209 | $ 1,820,097 |
Percentage Of Fixed Maturities At Fair Value | 10.00% | 11.00% |
Other corporate sectors | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturities, available for sale, amortized cost | $ 6,382,707 | $ 6,065,803 |
Gross Unrealized Gains | 283,524 | 747,612 |
Gross Unrealized Losses | (242,509) | (20,616) |
Fair Value | $ 6,423,722 | $ 6,792,799 |
Percentage Of Fixed Maturities At Fair Value | 40.00% | 40.00% |
Investments - Schedule of Fixed
Investments - Schedule of Fixed Maturities by Contractual Maturity (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fixed Maturities Available for Sale, Amortized Cost | ||
Due in one year or less | $ 190,025 | |
Due after one year through five years | 631,833 | |
Due after five years through ten years | 1,680,184 | |
Due after ten years through twenty years | 5,090,608 | |
Due after twenty years | 7,955,528 | |
Mortgage-backed and asset-backed securities | 205,293 | |
Cost or Amortized Cost | 15,753,471 | $ 14,995,101 |
Fixed Maturities Available for Sale, Fair Value | ||
Due in one year or less | 192,792 | |
Due after one year through five years | 656,317 | |
Due after five years through ten years | 1,811,532 | |
Due after ten years through twenty years | 5,516,103 | |
Due after twenty years | 7,898,702 | |
Mortgage-backed and asset-backed securities | 222,486 | |
Total fixed maturities available for sale, Fair Value | $ 16,297,932 | $ 16,969,325 |
Investments - Schedule of Analy
Investments - Schedule of Analysis of Investment Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net Investment Income [Line Items] | |||||||||||
Investment income, gross | $ 898,149 | $ 862,730 | $ 820,581 | ||||||||
Less investment expense | (15,637) | (14,845) | (13,678) | ||||||||
Net investment income | $ 224,233 | $ 221,627 | $ 218,568 | $ 218,084 | $ 212,955 | $ 213,872 | $ 212,776 | $ 208,282 | 882,512 | 847,885 | 806,903 |
Fixed maturities available for sale | |||||||||||
Net Investment Income [Line Items] | |||||||||||
Investment income, gross | 843,510 | 817,213 | 778,912 | ||||||||
Policy loans | |||||||||||
Net Investment Income [Line Items] | |||||||||||
Investment income, gross | 41,359 | 39,578 | 38,436 | ||||||||
Other long-term investments | |||||||||||
Net Investment Income [Line Items] | |||||||||||
Investment income, gross | 10,638 | 4,991 | 2,786 | ||||||||
Short-term investments | |||||||||||
Net Investment Income [Line Items] | |||||||||||
Investment income, gross | $ 2,642 | $ 948 | $ 447 |
Investments - Realized Gain (Lo
Investments - Realized Gain (Loss) on Investments (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Gain (Loss) on Securities [Line Items] | |||||||||||
Realized gains (losses) | $ (16,600) | $ 1,032 | $ 11,813 | $ 1,951 | $ 17,469 | $ 12,595 | $ (705) | $ (5,748) | $ 9,274 | $ 27,652 | $ (10,683) |
Realized gains (losses) from investments including redemption of debt | (1,804) | 23,611 | (10,683) | ||||||||
Applicable tax | 379 | (6,021) | 3,739 | ||||||||
Realized gains (losses), net of tax | (1,425) | 17,590 | (6,944) | ||||||||
Loss on redemption on debt | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Realized gains (losses) | (11,078) | (4,041) | 0 | ||||||||
Fixed maturities available for sale | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Realized gains (losses) | 5,715 | 35,199 | (10,645) | ||||||||
Fixed maturities available for sale | Other-than-temporary impairments | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Realized gains (losses) | 0 | (245) | 0 | ||||||||
Fair value option—change in fair value | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Realized gains (losses) | 2,650 | 0 | 0 | ||||||||
Other investments | |||||||||||
Gain (Loss) on Securities [Line Items] | |||||||||||
Realized gains (losses) | $ 909 | $ (7,302) | $ (38) |
Investments - Unrealized Gain (
Investments - Unrealized Gain (Loss) on Investments (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Gain (Loss) on Securities [Line Items] | |||
Net change in unrealized gains (losses) | $ (1,434,918) | $ 921,421 | $ 553,801 |
Fixed maturities available for sale | |||
Gain (Loss) on Securities [Line Items] | |||
Net change in unrealized gains (losses) | (1,429,763) | 916,413 | 551,658 |
Other investments | |||
Gain (Loss) on Securities [Line Items] | |||
Net change in unrealized gains (losses) | $ (5,155) | $ 5,008 | $ 2,143 |
Investments - Schedule of Selec
Investments - Schedule of Selected Information about Sales of Fixed Maturities (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Securities, Available-for-sale [Line Items] | |||
Proceeds from sales | $ 32,021,000 | $ 67,246,000 | $ 340,434,000 |
Fixed maturities available for sale | |||
Debt Securities, Available-for-sale [Line Items] | |||
Proceeds from sales | 32,021,000 | 67,246,000 | 358,285,000 |
Gross realized gains | 66,000 | 5,079,000 | 6,133,000 |
Gross realized losses | 13,996,000 | 1,100,000 | 32,608,000 |
Unsettled sales | $ 0 | $ 0 | $ 17,900,000 |
Investments - Assets Measured a
Investments - Assets Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 16,297,932 | $ 16,969,325 |
Percentage of total | 100.00% | 100.00% |
U.S. Government direct, guaranteed, and government-sponsored enterprises | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 392,668 | $ 407,446 |
States, municipalities, and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 1,436,660 | 1,219,715 |
Foreign governments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 20,816 | 22,018 |
Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 14,226,012 | 15,099,210 |
Collateralized debt obligations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 73,369 | 71,581 |
Other asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 148,407 | 149,355 |
Financial | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 3,935,128 | 4,131,881 |
Utilities | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 2,182,953 | 2,354,433 |
Energy | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 1,684,209 | 1,820,097 |
Other corporate sectors | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 6,423,722 | 6,792,799 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 0 | $ 44 |
Percentage of total | 0.00% | 0.00% |
Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. Government direct, guaranteed, and government-sponsored enterprises | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 0 | $ 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | States, municipalities, and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 44 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Foreign governments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Collateralized debt obligations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Other asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Financial | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Utilities | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Energy | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Other corporate sectors | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 15,658,110 | $ 16,300,841 |
Percentage of total | 96.00% | 96.00% |
Significant Other Observable Inputs (Level 2) | U.S. Government direct, guaranteed, and government-sponsored enterprises | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 392,668 | $ 407,446 |
Significant Other Observable Inputs (Level 2) | States, municipalities, and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 1,436,660 | 1,219,671 |
Significant Other Observable Inputs (Level 2) | Foreign governments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 20,816 | 22,018 |
Significant Other Observable Inputs (Level 2) | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 13,672,541 | 14,516,400 |
Significant Other Observable Inputs (Level 2) | Collateralized debt obligations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Other asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 135,425 | 135,306 |
Significant Other Observable Inputs (Level 2) | Financial | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 3,891,728 | 4,069,875 |
Significant Other Observable Inputs (Level 2) | Utilities | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 2,032,127 | 2,198,703 |
Significant Other Observable Inputs (Level 2) | Energy | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 1,645,077 | 1,779,281 |
Significant Other Observable Inputs (Level 2) | Other corporate sectors | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 6,103,609 | 6,468,541 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 639,822 | $ 668,440 |
Percentage of total | 4.00% | 4.00% |
Significant Unobservable Inputs (Level 3) | U.S. Government direct, guaranteed, and government-sponsored enterprises | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 0 | $ 0 |
Significant Unobservable Inputs (Level 3) | States, municipalities, and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Foreign governments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 553,471 | 582,810 |
Significant Unobservable Inputs (Level 3) | Collateralized debt obligations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 73,369 | 71,581 |
Significant Unobservable Inputs (Level 3) | Other asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 12,982 | 14,049 |
Significant Unobservable Inputs (Level 3) | Financial | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 43,400 | 62,006 |
Significant Unobservable Inputs (Level 3) | Utilities | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 150,826 | 155,730 |
Significant Unobservable Inputs (Level 3) | Energy | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 39,132 | 40,816 |
Significant Unobservable Inputs (Level 3) | Other corporate sectors | Corporates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 320,113 | $ 324,258 |
Investments - Schedule of Chang
Investments - Schedule of Changes in Assets Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | |||
Beginning Balance | $ 668,440 | $ 623,103 | $ 601,188 |
Included in realized gains/losses | 698 | 0 | 788 |
Included in other comprehensive income | (21,108) | 20,964 | 2,460 |
Acquisitions | 27,453 | 35,666 | 33,662 |
Sales | 0 | 0 | 0 |
Amortization | 4,753 | 4,931 | 5,203 |
Other | (44,947) | (16,224) | (20,198) |
Transfers into (out of) Level 3(2) | 4,533 | 0 | 0 |
Ending Balance | 639,822 | 668,440 | 623,103 |
Asset-backed securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | |||
Beginning Balance | 14,049 | 0 | 0 |
Included in realized gains/losses | 0 | 0 | 0 |
Included in other comprehensive income | (591) | 410 | 0 |
Acquisitions | 0 | 14,000 | 0 |
Sales | 0 | 0 | 0 |
Amortization | 0 | 0 | 0 |
Other | (476) | (361) | 0 |
Transfers into (out of) Level 3(2) | 0 | 0 | 0 |
Ending Balance | 12,982 | 14,049 | 0 |
Collateralized debt obligations | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | |||
Beginning Balance | 71,581 | 63,503 | 70,382 |
Included in realized gains/losses | 0 | 0 | 0 |
Included in other comprehensive income | 3,170 | 9,654 | (3,943) |
Acquisitions | 0 | 0 | 0 |
Sales | 0 | 0 | 0 |
Amortization | 4,737 | 4,914 | 5,186 |
Other | (6,119) | (6,490) | (8,122) |
Transfers into (out of) Level 3(2) | 0 | 0 | 0 |
Ending Balance | 73,369 | 71,581 | 63,503 |
Corporates | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | |||
Beginning Balance | 582,810 | 559,600 | 530,806 |
Included in realized gains/losses | 698 | 0 | 788 |
Included in other comprehensive income | (23,687) | 10,900 | 6,403 |
Acquisitions | 27,453 | 21,666 | 33,662 |
Sales | 0 | 0 | 0 |
Amortization | 16 | 17 | 17 |
Other | (38,352) | (9,373) | (12,076) |
Transfers into (out of) Level 3(2) | 4,533 | 0 | 0 |
Ending Balance | $ 553,471 | $ 582,810 | $ 559,600 |
Investments - Quantitative Info
Investments - Quantitative Information about Level 3 Fair Value Measurements (Detail) $ in Thousands | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | $ 16,297,932 | $ 16,969,325 |
Collateralized debt obligations | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | 73,369 | 71,581 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | 639,822 | 668,440 |
Significant Unobservable Inputs (Level 3) | Asset-backed securities | Discounted cash flows | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | 12,982 | |
Significant Unobservable Inputs (Level 3) | Collateralized debt obligations | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | 73,369 | $ 71,581 |
Significant Unobservable Inputs (Level 3) | Collateralized debt obligations | Discounted cash flows | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | 73,369 | |
Significant Unobservable Inputs (Level 3) | Private placement fixed maturities | Discounted cash flows | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | $ 553,471 | |
Discount rate | Significant Unobservable Inputs (Level 3) | Discounted cash flows | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Asset-backed securities | 0.0565 | |
Discount rate | Minimum | Significant Unobservable Inputs (Level 3) | Discounted cash flows | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateralized debt obligations | 0.0670 | |
Private placement fixed maturities | 0.0362 | |
Discount rate | Maximum | Significant Unobservable Inputs (Level 3) | Discounted cash flows | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateralized debt obligations | 0.0770 | |
Private placement fixed maturities | 0.1130 | |
Discount rate | Weighted Average | Significant Unobservable Inputs (Level 3) | Discounted cash flows | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Asset-backed securities | 0.0565 | |
Collateralized debt obligations | 0.0751 | |
Private placement fixed maturities | 0.0467 |
Investments - Transfers in and
Investments - Transfers in and Out of Each of the Valuation Levels of Fair Values (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Transfers In And Out Of Each Of The Valuation Levels Of Fair Values Of Investments[Line Items] | |||
In | $ 0 | $ 42,372 | $ 45,344 |
Out | 0 | (597) | 0 |
Net | 0 | 41,775 | 45,344 |
Significant Other Observable Inputs (Level 2) | |||
Transfers In And Out Of Each Of The Valuation Levels Of Fair Values Of Investments[Line Items] | |||
In | 0 | 597 | 0 |
Out | (4,533) | (42,372) | (45,344) |
Net | (4,533) | (41,775) | (45,344) |
Significant Unobservable Inputs (Level 3) | |||
Transfers In And Out Of Each Of The Valuation Levels Of Fair Values Of Investments[Line Items] | |||
In | 4,533 | 0 | 0 |
Out | 0 | 0 | 0 |
Net | $ 4,533 | $ 0 | $ 0 |
Investments - Additional Inform
Investments - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2018USD ($)Issue | Dec. 31, 2017USD ($)Issue | Dec. 31, 2016USD ($) | |
Investment [Line Items] | |||
Securities, cash and short-term investments held on deposit | $ 712,000,000 | $ 657,000,000 | |
Securities, cash and short-term investments held on deposit, at fair value | 763,000,000 | 753,000,000 | |
Written down securities carried at fair value | $ 60,000,000 | ||
Written down securities carried at fair value, percentage | 0.40% | ||
Gross unrealized loss | $ (428,000,000) | $ (83,000,000) | |
Decrease in unrealized loss position | $ (346,000,000) | ||
Total issues of fixed-maturities | Issue | 1,548 | 1,502 | |
Securities of state and municipal governments | 8.00% | ||
Concentration risk percentage | 100.00% | ||
Percentage of invested assets rated below investment grade | 3.00% | ||
Par value of investment in fixed maturities rated below investment grade | $ 757,000,000 | ||
Amortized cost of investment in fixed maturities rated below investment grade | 666,000,000 | ||
Fair value of investment in fixed maturities rated below investment grade | 601,000,000 | ||
Invested assets, fair value | $ 399,000 | ||
TEXAS | |||
Investment [Line Items] | |||
State and municipal government securities at fair value invested by state | 30.00% | ||
WASHINGTON | |||
Investment [Line Items] | |||
State and municipal government securities at fair value invested by state | 7.00% | ||
OHIO | |||
Investment [Line Items] | |||
State and municipal government securities at fair value invested by state | 7.00% | ||
FLORIDA | |||
Investment [Line Items] | |||
State and municipal government securities at fair value invested by state | 6.00% | ||
ILLINOIS | |||
Investment [Line Items] | |||
State and municipal government securities at fair value invested by state | 6.00% | ||
MICHIGAN | |||
Investment [Line Items] | |||
State and municipal government securities at fair value invested by state | 4.00% | ||
OTHER STATES | |||
Investment [Line Items] | |||
Proportion of state and municipal government securities at fair value invested in selected states | 4.00% | ||
Fixed maturities available for sale | |||
Investment [Line Items] | |||
Other-than-temporary impairment | $ 0 | $ 245,000 | $ 0 |
Other-than-temporary impairment, net of tax | $ 0 | $ 159,000 | $ 0 |
Investment Portfolio | Credit Concentration Risk | Corporate Debt Securities and Redeemable Preferred Stock | |||
Investment [Line Items] | |||
Concentration risk percentage | 83.00% |
Investments - Schedule of Unrea
Investments - Schedule of Unrealized Investment Losses by Class of Investment (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | $ 4,698,830 | $ 498,363 |
Unrealized Loss | (252,192) | (9,332) |
Fair Value | 1,290,990 | 605,288 |
Unrealized Loss | (176,187) | (73,351) |
Fair Value | 5,989,820 | 1,103,651 |
Total | (428,379) | (82,683) |
Investment Grade | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 4,458,883 | 464,715 |
Unrealized Loss | (229,105) | (4,057) |
Fair Value | 1,091,128 | 354,546 |
Unrealized Loss | (106,067) | (11,154) |
Fair Value | 5,550,011 | 819,261 |
Total | (335,172) | (15,211) |
Investment Grade | U.S. Government direct, guaranteed, and government-sponsored enterprises | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 37,182 | 34,388 |
Unrealized Loss | (212) | (422) |
Fair Value | 89,664 | 47,514 |
Unrealized Loss | (2,575) | (951) |
Fair Value | 126,846 | 81,902 |
Total | (2,787) | (1,373) |
Investment Grade | States, municipalities, and political subdivisions | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 124,907 | 4,561 |
Unrealized Loss | (1,648) | (21) |
Fair Value | 7,981 | 1,771 |
Unrealized Loss | (102) | (9) |
Fair Value | 132,888 | 6,332 |
Total | (1,750) | (30) |
Investment Grade | Foreign governments | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 0 | 0 |
Unrealized Loss | 0 | 0 |
Fair Value | 0 | 0 |
Unrealized Loss | 0 | 0 |
Fair Value | 0 | 0 |
Total | 0 | 0 |
Investment Grade | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 4,252,191 | 425,766 |
Unrealized Loss | (226,611) | (3,614) |
Fair Value | 993,483 | 305,261 |
Unrealized Loss | (103,390) | (10,194) |
Fair Value | 5,245,674 | 731,027 |
Total | (330,001) | (13,808) |
Investment Grade | Collateralized debt obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 0 | |
Unrealized Loss | 0 | |
Fair Value | 0 | |
Unrealized Loss | 0 | |
Fair Value | 0 | |
Total | 0 | |
Investment Grade | Other asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 44,603 | 0 |
Unrealized Loss | (634) | 0 |
Fair Value | 0 | 0 |
Unrealized Loss | 0 | 0 |
Fair Value | 44,603 | 0 |
Total | (634) | 0 |
Below Investment Grade | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 239,947 | 33,648 |
Unrealized Loss | (23,087) | (5,275) |
Fair Value | 199,862 | 250,742 |
Unrealized Loss | (70,120) | (62,197) |
Fair Value | 439,809 | 284,390 |
Total | (93,207) | (67,472) |
Below Investment Grade | States, municipalities, and political subdivisions | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 0 | 200 |
Unrealized Loss | 0 | (105) |
Fair Value | 0 | 0 |
Unrealized Loss | 0 | 0 |
Fair Value | 0 | 200 |
Total | 0 | (105) |
Below Investment Grade | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 239,947 | 33,448 |
Unrealized Loss | (23,087) | (5,170) |
Fair Value | 186,276 | 238,395 |
Unrealized Loss | (63,706) | (54,544) |
Fair Value | 426,223 | 271,843 |
Total | (86,793) | (59,714) |
Below Investment Grade | Collateralized debt obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 0 | 0 |
Unrealized Loss | 0 | 0 |
Fair Value | 13,586 | 12,347 |
Unrealized Loss | (6,414) | (7,653) |
Fair Value | 13,586 | 12,347 |
Total | (6,414) | (7,653) |
Financial | Investment Grade | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 931,161 | 133,080 |
Unrealized Loss | (36,337) | (652) |
Fair Value | 241,442 | 35,302 |
Unrealized Loss | (21,572) | (1,429) |
Fair Value | 1,172,603 | 168,382 |
Total | (57,909) | (2,081) |
Financial | Below Investment Grade | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 22,087 | 0 |
Unrealized Loss | (8,674) | 0 |
Fair Value | 81,101 | 108,808 |
Unrealized Loss | (20,932) | (24,038) |
Fair Value | 103,188 | 108,808 |
Total | (29,606) | (24,038) |
Utilities | Investment Grade | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 329,753 | 48,562 |
Unrealized Loss | (11,680) | (569) |
Fair Value | 121,308 | 38,298 |
Unrealized Loss | (9,442) | (826) |
Fair Value | 451,061 | 86,860 |
Total | (21,122) | (1,395) |
Utilities | Below Investment Grade | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 28,613 | |
Unrealized Loss | (3,277) | |
Fair Value | 0 | |
Unrealized Loss | 0 | |
Fair Value | 28,613 | |
Total | (3,277) | |
Energy | Investment Grade | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 475,736 | 23,463 |
Unrealized Loss | (29,426) | (81) |
Fair Value | 54,937 | 67,775 |
Unrealized Loss | (9,382) | (3,682) |
Fair Value | 530,673 | 91,238 |
Total | (38,808) | (3,763) |
Energy | Below Investment Grade | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 42,874 | 8,114 |
Unrealized Loss | (3,901) | (104) |
Fair Value | 36,122 | 75,204 |
Unrealized Loss | (19,662) | (21,525) |
Fair Value | 78,996 | 83,318 |
Total | (23,563) | (21,629) |
Other corporate sectors | Investment Grade | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 2,515,541 | 220,661 |
Unrealized Loss | (149,168) | (2,312) |
Fair Value | 575,796 | 163,886 |
Unrealized Loss | (62,994) | (4,257) |
Fair Value | 3,091,337 | 384,547 |
Total | (212,162) | (6,569) |
Other corporate sectors | Below Investment Grade | Corporates | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 146,373 | 25,334 |
Unrealized Loss | (7,235) | (5,066) |
Fair Value | 69,053 | 54,383 |
Unrealized Loss | (23,112) | (8,981) |
Fair Value | 215,426 | 79,717 |
Total | $ (30,347) | $ (14,047) |
Investments - Schedule of Addit
Investments - Schedule of Additional Information about Investments in Unrealized Loss Position (Detail) - Issue | Dec. 31, 2018 | Dec. 31, 2017 |
Investments, Debt and Equity Securities [Abstract] | ||
Less than Twelve Months | 495 | 92 |
Twelve Months or Longer | 234 | 102 |
Total | 729 | 194 |
Investments - Summary of Invest
Investments - Summary of Investment Portfolio (Detail) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Securities, Available-for-sale [Line Items] | |
Concentration risk percentage | 100.00% |
Policy loans | Below Investment Grade | |
Debt Securities, Available-for-sale [Line Items] | |
Concentration risk percentage | 3.00% |
Other Debt Obligations | Below Investment Grade | |
Debt Securities, Available-for-sale [Line Items] | |
Concentration risk percentage | 2.00% |
Corporates | Fixed maturities available for sale | Investment Grade | |
Debt Securities, Available-for-sale [Line Items] | |
Concentration risk percentage | 80.00% |
Corporates | Fixed maturities available for sale | Below Investment Grade | |
Debt Securities, Available-for-sale [Line Items] | |
Concentration risk percentage | 3.00% |
States, municipalities, and political subdivisions | Fixed maturities available for sale | Investment Grade | |
Debt Securities, Available-for-sale [Line Items] | |
Concentration risk percentage | 8.00% |
Government-sponsored enterprises | Fixed maturities available for sale | Investment Grade | |
Debt Securities, Available-for-sale [Line Items] | |
Concentration risk percentage | 2.00% |
Other Debt Obligations | Fixed maturities available for sale | Investment Grade | |
Debt Securities, Available-for-sale [Line Items] | |
Concentration risk percentage | 2.00% |
Other Debt Obligations | Fixed maturities available for sale | Below Investment Grade | |
Debt Securities, Available-for-sale [Line Items] | |
Concentration risk percentage | 0.00% |
Investments - Concentration of
Investments - Concentration of Credit Risk (Details) | Dec. 31, 2018 |
Investments, Debt and Equity Securities [Abstract] | |
Insurance | 15.00% |
Electric utilities | 11.00% |
Oil and natural gas pipelines | 7.00% |
Banks | 6.00% |
Transportation | 4.00% |
Oil and natural gas exploration and production | 4.00% |
Chemicals | 4.00% |
Real estate investment trusts | 4.00% |
Food | 4.00% |
Gas utilities | 3.00% |
Investments - Schedule of Other
Investments - Schedule of Other Long-Term Investments (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Investment [Line Items] | ||
Other long-term investments (includes: 2018—$108,241; 2017—$0, under the fair value option) | $ 207,258 | $ 108,559 |
Investment in limited partnerships | ||
Investment [Line Items] | ||
Other long-term investments (includes: 2018—$108,241; 2017—$0, under the fair value option) | 108,241 | 66,522 |
Commercial mortgage participations | ||
Investment [Line Items] | ||
Other long-term investments (includes: 2018—$108,241; 2017—$0, under the fair value option) | 96,266 | 39,489 |
Other | ||
Investment [Line Items] | ||
Other long-term investments (includes: 2018—$108,241; 2017—$0, under the fair value option) | $ 2,751 | $ 2,548 |
Investments - Commercial Mortga
Investments - Commercial Mortgage Loan Participations (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Investment [Line Items] | ||
Carrying value, net of valuation allowance, percent | 100.00% | 100.00% |
Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 96,266 | $ 39,489 |
Valuation allowance | 0 | 0 |
Carrying value, net of valuation allowance | $ 96,266 | $ 39,489 |
Carrying value, gross, percent | 100.00% | 100.00% |
Valuation allowance, percent | 0.00% | 0.00% |
Carrying value, net of valuation allowance, percent | 100.00% | 100.00% |
Office | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 35,289 | $ 18,378 |
Carrying value, gross, percent | 37.00% | 46.00% |
Hospitality | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 15,137 | $ 10,496 |
Carrying value, gross, percent | 16.00% | 27.00% |
Industrial | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 13,896 | $ 0 |
Carrying value, gross, percent | 14.00% | 0.00% |
Retail | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 12,934 | $ 0 |
Carrying value, gross, percent | 13.00% | 0.00% |
Mixed use | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 11,309 | $ 7,148 |
Carrying value, gross, percent | 12.00% | 18.00% |
Multi-family | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 7,701 | $ 3,467 |
Carrying value, gross, percent | 8.00% | 9.00% |
South Atlantic | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 39,414 | $ 18,378 |
Carrying value, gross, percent | 41.00% | 46.00% |
Middle Atlantic | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 23,488 | $ 3,467 |
Carrying value, gross, percent | 24.00% | 9.00% |
Pacific | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 20,843 | $ 7,148 |
Carrying value, gross, percent | 22.00% | 18.00% |
East North Central | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 10,531 | $ 10,496 |
Carrying value, gross, percent | 11.00% | 27.00% |
West South Central | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, gross | $ 1,990 | $ 0 |
Carrying value, gross, percent | 2.00% | 0.00% |
Investments - Commercial Mort_2
Investments - Commercial Mortgage Loan Participations Recorded Investment (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Investment [Line Items] | ||
Carrying value, net of valuation allowance, percent | 100.00% | 100.00% |
Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | $ 96,266 | $ 39,489 |
Carrying value, net of valuation allowance, percent | 100.00% | 100.00% |
Less than 70% | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance, percent | 89.00% | 73.00% |
Less than 70% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | $ 85,687 | $ 28,874 |
70% to 80% | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance, percent | 11.00% | 27.00% |
70% to 80% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | $ 10,579 | $ 10,615 |
81% to 90% | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance, percent | 0.00% | 0.00% |
81% to 90% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | $ 0 | $ 0 |
Greater than 90% | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance, percent | 0.00% | 0.00% |
Greater than 90% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | $ 0 | $ 0 |
Less Than 1.00x | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 28,922 | 3,467 |
Less Than 1.00x | Less than 70% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 18,343 | 0 |
Less Than 1.00x | 70% to 80% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 10,579 | 3,467 |
Less Than 1.00x | 81% to 90% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 0 | 0 |
Less Than 1.00x | Greater than 90% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 0 | 0 |
1.00x-1.20x | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 56,813 | 25,526 |
1.00x-1.20x | Less than 70% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 56,813 | 18,378 |
1.00x-1.20x | 70% to 80% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 0 | 7,148 |
1.00x-1.20x | 81% to 90% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 0 | 0 |
1.00x-1.20x | Greater than 90% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 0 | 0 |
Greater Than 1.20x | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 10,531 | 10,496 |
Greater Than 1.20x | Less than 70% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 10,531 | 10,496 |
Greater Than 1.20x | 70% to 80% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 0 | 0 |
Greater Than 1.20x | 81% to 90% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | 0 | 0 |
Greater Than 1.20x | Greater than 90% | Commercial mortgage participations | ||
Investment [Line Items] | ||
Carrying value, net of valuation allowance | $ 0 | $ 0 |
Deferred Acquisition Costs (Det
Deferred Acquisition Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Movement Analysis of Deferred Policy Acquisition Costs | |||||||||||
Balance at beginning of year | $ 3,958,063 | $ 3,783,158 | $ 3,958,063 | $ 3,783,158 | $ 3,617,135 | ||||||
Commissions | 497,459 | 465,920 | 436,252 | ||||||||
Other expenses | 202,092 | 194,214 | 199,066 | ||||||||
Total deferred | 699,551 | 660,134 | 635,318 | ||||||||
Foreign exchange adjustment | 0 | 5,712 | 2,180 | ||||||||
Adjustment attributable to unrealized investment losses | 5,549 | 0 | 0 | ||||||||
Total additions | 705,100 | 665,846 | 637,498 | ||||||||
Amortized during period | $ (128,501) | $ (129,492) | $ (129,077) | $ (129,620) | $ (120,040) | $ (122,334) | $ (122,121) | $ (125,908) | (516,690) | (490,403) | (469,063) |
Foreign exchange adjustment | (8,548) | 0 | 0 | ||||||||
Adjustment attributable to unrealized investment gains | 0 | (538) | (2,412) | ||||||||
Total deductions | (525,238) | (490,941) | (471,475) | ||||||||
Balance at end of year | $ 4,137,925 | $ 3,958,063 | $ 4,137,925 | $ 3,958,063 | $ 3,783,158 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | 12 Months Ended | |||
Dec. 31, 2018USD ($)stateguaranteelease | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Mar. 14, 2018USD ($) | |
Obligation with Joint and Several Liability Arrangement [Line Items] | ||||
Retention limits per life | $ 2,000,000 | |||
Percentage of insurance ceded on total life insurance in force | 0.40% | |||
Ratio of reinsurance ceded to premium income | 0.20% | |||
Life reinsurance assumed ratio to life insurance in force | 1.60% | |||
Reinsurance assumed ratio on premium income | 0.60% | 0.70% | 0.70% | |
Rental expense | $ 3,959,000 | $ 6,446,000 | $ 6,520,000 | |
Number of guarantee arrangements | guarantee | 3 | |||
Guarantee liability | $ 0 | |||
Letters of credit facility outstanding | $ 155,000,000 | 177,000,000 | $ 155,000,000 | |
Number of states private entities contracted with to conduct audits | state | 47 | |||
Letter of Credit | ||||
Obligation with Joint and Several Liability Arrangement [Line Items] | ||||
Letter of credit maximum available amount | $ 250,000,000 | |||
Equipment Lease Guarantees | ||||
Obligation with Joint and Several Liability Arrangement [Line Items] | ||||
Number of leases under guarantee | lease | 2 | |||
Maximum exposure under guarantees | $ 8,000,000 | |||
Commercial mortgage participations | ||||
Obligation with Joint and Several Liability Arrangement [Line Items] | ||||
Purchase commitment of private placement fixed maturities | 154,000,000 | |||
Investment in limited partnerships | ||||
Obligation with Joint and Several Liability Arrangement [Line Items] | ||||
Purchase commitment of private placement fixed maturities | $ 250,000,000 | |||
Insurance-related assessments | ||||
Obligation with Joint and Several Liability Arrangement [Line Items] | ||||
Guaranty liability, unrecoverable amount | $ 1,800,000 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Future Minimum Rental Commitments (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,019 | $ 4,304 |
2,020 | 4,208 |
2,021 | 3,560 |
2,022 | 2,755 |
2,023 | 1,916 |
Thereafter | $ 6,596 |
Commitments and Contingencies_3
Commitments and Contingencies - Low-Income Housing Commitments (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,019 | $ 27,938 |
2,020 | 23,515 |
2,021 | 4,121 |
2,022 | 2,705 |
2,023 | 3,018 |
Thereafter | $ 244,854 |
Liability for Unpaid Claims - S
Liability for Unpaid Claims - Summary of Liability for Unpaid Health Claims (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Activity in the Liability for Unpaid Health Claims | |||
Balance at beginning of year | $ 146,865 | $ 143,128 | $ 137,120 |
Incurred related to: | |||
Current year | 555,647 | 520,528 | 510,075 |
Prior years | (3,017) | (8,048) | (1,127) |
Total incurred | 552,630 | 512,480 | 508,948 |
Paid related to: | |||
Current year | 424,633 | 394,506 | 386,278 |
Prior years | 120,334 | 114,237 | 116,662 |
Total paid | 544,967 | 508,743 | 502,940 |
Balance at end of year | $ 154,528 | $ 146,865 | $ 143,128 |
Liability for Unpaid Claims - R
Liability for Unpaid Claims - Reconciliation of Net Incurred and Paid Claims Development to Liability (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||
Life insurance | $ 196,298 | $ 186,429 |
Policy claims and other benefits payable | 350,826 | 333,294 |
Total | 350,826 | 333,294 |
Health premium | ||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||
Policy claims and other benefits payable | $ 154,528 | $ 146,865 |
Income Taxes - Components of In
Income Taxes - Components of Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
Current income tax (benefit) expense | $ 134,626 | $ 138,262 | $ 132,806 |
Deferred income tax (benefit) expense | 27,535 | (765,877) | 99,839 |
Income tax expense (benefit) | 162,161 | (627,615) | 232,645 |
Shareholders’ equity: | |||
Other comprehensive income (loss) | (293,678) | 318,475 | 186,206 |
Income tax expense (benefit) | $ (131,517) | $ (309,140) | $ 418,851 |
Income Taxes - Summary of Effec
Income Taxes - Summary of Effective Income Tax Rate (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Expected federal income tax expense (benefit) | $ 181,371 | $ 290,727 | $ 270,282 | |
Increase (reduction) in income taxes resulting from, amount: | ||||
Tax reform adjustment | $ (798) | (798) | (877,400) | 0 |
Low income housing investments | (12,240) | (18,515) | (18,202) | |
Share-based awards | (6,450) | (19,549) | (18,653) | |
Other | 278 | (2,878) | (782) | |
Income tax expense (benefit) | $ 162,161 | $ (627,615) | $ 232,645 | |
Expected federal income tax expense (benefit) | 21.00% | 35.00% | 35.00% | |
Increase (reduction) in income taxes resulting from, percent: | ||||
Tax reform adjustment | (0.10%) | (105.60%) | 0.00% | |
Low income housing investments | (1.40%) | (2.20%) | (2.40%) | |
Share-based awards | (0.70%) | (2.40%) | (2.40%) | |
Other | 0.00% | (0.40%) | (0.10%) | |
Income tax expense (benefit) | 18.80% | (75.60%) | 30.10% |
Income Taxes - Significant Port
Income Taxes - Significant Portions of Deferred Tax Assets and Deferred Tax Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets: | ||
Fixed maturity investments | $ 6,131 | $ 8,692 |
Carryover of tax losses | 7,406 | 4,760 |
Total gross deferred tax assets | 13,537 | 13,452 |
Deferred tax liabilities: | ||
Unrealized gains | 87,871 | 380,251 |
Employee and agent compensation | 70,551 | 65,576 |
Deferred acquisition costs | 633,687 | 618,889 |
Future policy benefits, unearned and advance premiums, and policy claims | 242,285 | 248,752 |
Other liabilities | 25,603 | 11,289 |
Total gross deferred tax liabilities | 1,059,997 | 1,324,757 |
Net deferred tax liability | $ 1,046,460 | $ 1,311,305 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Tax Reform adjustment | $ 798,000 | $ 798,000 | $ 877,400,000 | $ 0 |
Operating loss carryforwards | 35,300,000 | 35,300,000 | ||
Deferred tax assets, valuation allowance | 0 | 0 | ||
Uncertain tax positions | 0 | 0 | 0 | 0 |
Interest income, net of federal income tax expense | 0 | 5,000 | $ 9,000 | |
Amount of accrued interest or penalties | $ 0 | $ 0 | $ 0 |
Postretirement Benefits - Total
Postretirement Benefits - Total Cost of Retirement Plans Charged to Operations (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Retirement Benefits [Abstract] | |||
Defined Contribution Plans | $ 4,068 | $ 4,145 | $ 3,614 |
Defined Benefit Pension Plans | $ 32,593 | $ 28,828 | $ 24,202 |
Postretirement Benefits - Addit
Postretirement Benefits - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Defined benefit plan contributions | $ 52,800,000 | $ 21,300,000 | $ 15,800,000 |
Maximum allowed investment percentage in any single issuer in pension plan assets at time of purchase | 10.00% | ||
Accumulated benefit obligation | $ 505,898,000 | 540,963,000 | |
Maximum | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Capped eligible compensation | 1,000,000 | ||
Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined benefit plan contributions | $ 52,781,000 | $ 21,272,000 |
Postretirement Benefits - Activ
Postretirement Benefits - Activity for the SERP (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Retirement Benefits [Abstract] | |||
Premiums paid for insurance coverage | $ 2,997 | $ 2,050 | $ 2,050 |
Company owned life insurance | 44,285 | 40,273 | |
Exchange traded funds | 52,659 | 55,442 | |
Total investments of SERP | $ 96,944 | $ 95,715 |
Postretirement Benefits - Pensi
Postretirement Benefits - Pension Assets by Components at Fair Value (Detail) - Pension Benefits - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 392,672 | $ 377,624 | $ 328,871 |
Total percentage | 100.00% | 100.00% | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 170,822 | $ 173,356 | |
Significant Other Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 221,850 | 204,268 | |
Corporate Bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 186,625 | $ 180,506 | |
Total percentage | 48.00% | 48.00% | |
Corporate Bonds | Significant Other Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 186,625 | $ 180,506 | |
Exchange Traded Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 157,717 | $ 164,351 | |
Total percentage | 40.00% | 43.00% | |
Exchange Traded Funds | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 157,717 | $ 164,351 | |
Other Bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 245 | $ 256 | |
Total percentage | 0.00% | 0.00% | |
Other Bonds | Significant Other Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 245 | $ 256 | |
Other long-term investments | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 8,475 | $ 2,304 | |
Total percentage | 2.00% | 1.00% | |
Other long-term investments | Significant Other Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 8,475 | $ 2,304 | |
Guaranteed Annuity Contract | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 26,505 | $ 21,202 | |
Total percentage | 7.00% | 6.00% | |
Guaranteed Annuity Contract | Significant Other Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 26,505 | $ 21,202 | |
Short-term investments | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 9,289 | $ 3,984 | |
Total percentage | 2.00% | 1.00% | |
Short-term investments | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 9,289 | $ 3,984 | |
Other | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 3,816 | $ 5,021 | |
Total percentage | 1.00% | 1.00% | |
Other | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 3,816 | $ 5,021 | |
Financial | Corporate Bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 44,236 | $ 43,451 | |
Total percentage | 11.00% | 12.00% | |
Financial | Corporate Bonds | Significant Other Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 44,236 | $ 43,451 | |
Utilities | Corporate Bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 39,443 | $ 46,144 | |
Total percentage | 10.00% | 12.00% | |
Utilities | Corporate Bonds | Significant Other Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 39,443 | $ 46,144 | |
Energy | Corporate Bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 19,744 | $ 25,023 | |
Total percentage | 5.00% | 7.00% | |
Energy | Corporate Bonds | Significant Other Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 19,744 | $ 25,023 | |
Other corporate sectors | Corporate Bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 83,202 | $ 65,888 | |
Total percentage | 22.00% | 17.00% | |
Other corporate sectors | Corporate Bonds | Significant Other Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 83,202 | $ 65,888 |
Postretirement Benefits - PBO a
Postretirement Benefits - PBO and ABO (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Defined Benefit Plan Disclosure [Line Items] | |||
PBO | $ 556,199 | $ 602,606 | |
ABO | 505,898 | 540,963 | |
Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
PBO | 556,199 | 602,606 | $ 527,522 |
Qualified Plan | Funded | Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
PBO | 481,792 | 518,141 | |
ABO | 436,316 | 466,307 | |
Nonqualified | SERP | |||
Defined Benefit Plan Disclosure [Line Items] | |||
PBO | 74,407 | 84,465 | |
ABO | $ 69,582 | $ 74,656 |
Postretirement Benefits - Weigh
Postretirement Benefits - Weighted Average Pension Plan Assumptions and Weighted Average Assumptions for Post-Retirement Benefit Plans Other Than Pensions (Detail) - Pension Benefits | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Discount rate | 4.37% | 3.75% | |
Rate of compensation increase | 4.00% | 4.37% | |
Discount rate | 3.75% | 4.27% | 4.64% |
Expected long-term returns | 6.72% | 6.96% | 7.19% |
Rate of compensation increase | 4.37% | 4.31% | 4.33% |
Postretirement Benefits - Compo
Postretirement Benefits - Components of Net Periodic Pension Costs and Post-Retirement Benefit Costs (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Net amortization | $ 15,095 | $ 12,436 | $ 10,168 |
Net periodic benefit cost | 32,593 | 28,828 | 24,202 |
Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost—benefits earned during the period | 21,092 | 17,942 | 15,502 |
Interest cost on projected benefit obligation | 22,303 | 22,124 | 21,631 |
Expected return on assets | (25,547) | (23,597) | (23,127) |
Net amortization | 15,003 | 12,281 | 10,135 |
Recognition of actuarial loss | (258) | 78 | 61 |
Net periodic benefit cost | 32,593 | 28,828 | 24,202 |
Other Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net amortization | $ 92 | $ 155 | $ 33 |
Postretirement Benefits - Analy
Postretirement Benefits - Analysis of Impact on Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Defined Benefit Plan, Impact on Other Comprehensive Income | |||
Balance at January 1 | $ (193,380) | $ (173,883) | $ (152,149) |
Amortization of prior service cost | 535 | 476 | 477 |
Amortization of net actuarial (gain) loss | 14,560 | 11,960 | 9,691 |
Total amortization | 15,095 | 12,436 | 10,168 |
Plan amendments | (2,377) | 0 | 0 |
Experience gain (loss) | 30,591 | (31,933) | (31,902) |
Balance at December 31 | (150,071) | (193,380) | (173,883) |
Other Benefits | |||
Defined Benefit Plan, Impact on Other Comprehensive Income | |||
Total amortization | $ 92 | $ 155 | $ 33 |
Postretirement Benefits - Recon
Postretirement Benefits - Reconciliation of Benefit Obligation and Plan Assets, Pension Benefits (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Changes in benefit obligation: | |||
PBO at beginning of year | $ 602,606 | ||
PBO at end of year | 556,199 | $ 602,606 | |
Changes in plan assets: | |||
Contributions | 52,800 | 21,300 | $ 15,800 |
Pension Benefits | |||
Changes in benefit obligation: | |||
PBO at beginning of year | 602,606 | 527,522 | |
Service cost | 21,092 | 17,942 | 15,502 |
Interest cost | 22,303 | 22,124 | 21,631 |
Plan amendments | 2,377 | 0 | |
Actuarial loss (gain) | (67,270) | 55,369 | |
Benefits paid | (24,909) | (20,351) | |
PBO at end of year | 556,199 | 602,606 | 527,522 |
Changes in plan assets: | |||
Fair value at beginning of year | 377,624 | 328,871 | |
Return on assets | (12,824) | 47,832 | |
Contributions | 52,781 | 21,272 | |
Benefits paid | (24,909) | (20,351) | |
Fair value at end of year | 392,672 | 377,624 | $ 328,871 |
Funded status at year end | $ (163,527) | $ (224,982) |
Postretirement Benefits - Sched
Postretirement Benefits - Schedule of Amounts Recognized in Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Net amounts recognized at year end | $ (150,071) | $ (193,380) | $ (173,883) | $ (152,149) |
Pension Benefits | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Net loss (gain) | 143,453 | 186,563 | ||
Prior service cost | 5,976 | 4,135 | ||
Net amounts recognized at year end | $ 149,429 | $ 190,698 |
Postretirement Benefits - Porti
Postretirement Benefits - Portion of Other Comprehensive Income Expected to Be Reflected in Pension Expense in Next Year (Detail) - Pension Benefits $ in Thousands | Dec. 31, 2018USD ($) |
Postretirement Benefits [Abstract] | |
Amortization of prior service cost | $ 631 |
Amortization of net actuarial loss | 7,580 |
Total | $ 8,211 |
Postretirement Benefits - Estim
Postretirement Benefits - Estimated Future Payments for Pension Benefits and Other Postretirement Benefit Plans (Detail) - Pension Benefits $ in Thousands | Dec. 31, 2018USD ($) |
Defined Benefit Plan Disclosure [Line Items] | |
2,019 | $ 21,442 |
2,020 | 23,159 |
2,021 | 24,806 |
2,022 | 26,847 |
2,023 | 28,661 |
2024-2028 | $ 167,177 |
Supplemental Disclosures of C_3
Supplemental Disclosures of Cash Flow Information - Summary of Noncash Transactions (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |||
Stock-based compensation not involving cash | $ 39,792 | $ 37,034 | $ 26,326 |
Commitments for low-income housing interests | 50,883 | 33,846 | 56,818 |
Exchanges of fixed maturity investments | 193,449 | 84,312 | 224,901 |
Net unsettled security trades | $ 39,851 | $ 0 | $ 15,020 |
Supplemental Disclosures of C_4
Supplemental Disclosures of Cash Flow Information - Summary of Amount Paid (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |||
Interest paid | $ 83,518 | $ 82,494 | $ 81,338 |
Income taxes paid | $ 91,510 | $ 74,379 | $ 79,790 |
Debt - Selected Information abo
Debt - Selected Information about Debt Issues (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||
Outstanding Principal (Par Value) | $ 1,384,362 | |
Outstanding Principal (Book Value) | 1,364,060 | $ 1,136,576 |
Outstanding Principal (Fair Value) | 1,391,330 | |
Less current maturity of term loan, par value | 6,875 | |
Less current maturity of term loan, book value | 6,875 | 4,375 |
Less current maturity of term loan, fair value | 6,875 | |
Total long-term debt, par value | 1,377,487 | |
Long-term debt | 1,357,185 | 1,132,201 |
Total long-term debt, fair value | 1,384,455 | 1,228,392 |
Total short-term debt, par value | 308,975 | |
Total short-term debt, book value | 307,848 | 328,067 |
Total short-term debt, fair value | 307,848 | |
Total debt, par value | 1,686,462 | |
Total debt, book value | 1,665,033 | 1,460,268 |
Total debt, fair value | 1,692,303 | |
Commercial Paper | ||
Debt Instrument [Line Items] | ||
Total short-term debt, par value | 302,100 | |
Total short-term debt, book value | 300,973 | 323,692 |
Total short-term debt, fair value | $ 300,973 | |
Notes, Due 5/15/23 | ||
Debt Instrument [Line Items] | ||
Debt instrument, maturity date | May 15, 2023 | |
Annual Interest Rate | 7.875% | |
Issue Date | 1993-05 | |
Outstanding Principal (Par Value) | $ 165,612 | |
Outstanding Principal (Book Value) | 164,490 | 164,284 |
Outstanding Principal (Fair Value) | $ 192,945 | |
Senior Notes, Due 6/15/19 | ||
Debt Instrument [Line Items] | ||
Debt instrument, maturity date | Jun. 15, 2019 | |
Annual Interest Rate | 9.25% | |
Issue Date | 2009-06 | |
Outstanding Principal (Par Value) | $ 0 | |
Outstanding Principal (Book Value) | 0 | 291,888 |
Outstanding Principal (Fair Value) | $ 0 | |
Senior Notes, Due 9/15/22 | ||
Debt Instrument [Line Items] | ||
Debt instrument, maturity date | Sep. 15, 2022 | |
Annual Interest Rate | 3.80% | |
Issue Date | 2012-09 | |
Outstanding Principal (Par Value) | $ 150,000 | |
Outstanding Principal (Book Value) | 148,777 | 148,477 |
Outstanding Principal (Fair Value) | $ 150,481 | |
Senior Notes, Due 9/15/28 | ||
Debt Instrument [Line Items] | ||
Debt instrument, maturity date | Sep. 15, 2028 | |
Annual Interest Rate | 4.55% | |
Issue Date | 2018-09 | |
Outstanding Principal (Par Value) | $ 550,000 | |
Outstanding Principal (Book Value) | 543,169 | 0 |
Outstanding Principal (Fair Value) | $ 558,825 | |
Junior Subordinated Debentures Due 3/15/36 | ||
Debt Instrument [Line Items] | ||
Debt instrument, maturity date | Mar. 15, 2036 | |
Annual Interest Rate | 0.00% | |
Outstanding Principal (Par Value) | $ 0 | |
Outstanding Principal (Book Value) | 0 | 20,000 |
Outstanding Principal (Fair Value) | $ 0 | |
Junior Subordinated Debentures Due 3/15/36 | London Interbank Offered Rate (LIBOR) | ||
Debt Instrument [Line Items] | ||
Basis spread | 3.30% | |
Junior Subordinated Debentures Due 6/15/56 | ||
Debt Instrument [Line Items] | ||
Debt instrument, maturity date | Jun. 15, 2056 | |
Annual Interest Rate | 6.125% | |
Issue Date | 2016-04 | |
Outstanding Principal (Par Value) | $ 300,000 | |
Outstanding Principal (Book Value) | 290,520 | 290,460 |
Outstanding Principal (Fair Value) | $ 301,200 | |
Junior Subordinated Debentures Due 11/17/57 | ||
Debt Instrument [Line Items] | ||
Debt instrument, maturity date | Nov. 17, 2057 | |
Annual Interest Rate | 5.275% | |
Issue Date | 2017-11 | |
Outstanding Principal (Par Value) | $ 125,000 | |
Outstanding Principal (Book Value) | 123,354 | 123,342 |
Outstanding Principal (Fair Value) | $ 94,129 | |
Term Loan Due 5/17/21 | ||
Debt Instrument [Line Items] | ||
Debt instrument, maturity date | May 17, 2021 | |
Annual Interest Rate | 3.595% | |
Issue Date | 2016-06 | |
Outstanding Principal (Par Value) | $ 93,750 | |
Outstanding Principal (Book Value) | 93,750 | $ 98,125 |
Outstanding Principal (Fair Value) | $ 93,750 | |
Term Loan Due 5/17/21 | London Interbank Offered Rate (LIBOR) | ||
Debt Instrument [Line Items] | ||
Basis spread | 1.25% |
Debt - Amount of Debt Due in Ne
Debt - Amount of Debt Due in Next Five Years (Detail) $ in Thousands | Dec. 31, 2018USD ($) |
Debt Disclosure [Abstract] | |
2,019 | $ 308,975 |
2,020 | 9,375 |
2,021 | 77,500 |
2,022 | 150,000 |
2,023 | 165,612 |
Thereafter | $ 975,000 |
Debt - Additional Information (
Debt - Additional Information (Detail) - USD ($) | Oct. 29, 2018 | Sep. 27, 2018 | Jun. 15, 2018 | Nov. 17, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | May 17, 2016 |
Debt Instrument [Line Items] | ||||||||
Debt, face amount | $ 1,686,462,000 | |||||||
Loss on extinguishment of debt | 11,078,000 | $ 4,041,000 | ||||||
Redemption of notes | $ 327,762,000 | $ 126,875,000 | $ 250,000,000 | |||||
Payments of additional capital to insurance subsidiaries | $ 150,000,000 | |||||||
Term Loan Due 5/17/21 | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 3.595% | |||||||
Senior Notes, Due 9/15/28 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt, face amount | $ 550,000,000 | |||||||
Interest rate | 4.55% | |||||||
Proceeds from sale of notes | $ 543,000,000 | |||||||
Senior Notes, Due 6/15/19 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 9.25% | |||||||
Redemption of notes | $ 293,000,000 | |||||||
Payment of make-whole premium | 11,000,000 | |||||||
Accrued interest | $ 10,000,000 | |||||||
Junior Subordinated Debentures Due 3/15/36 | Junior Subordinated Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Redemption of notes | $ 20,000,000 | |||||||
Junior Subordinated Debentures Due 11/17/57 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt, face amount | $ 125,000,000 | |||||||
Interest rate | 5.875% | |||||||
Loss on extinguishment of debt | $ 4,000,000 | |||||||
Accrued interest | 143,000 | |||||||
Junior Subordinated Debentures Due 11/17/57 | Junior Subordinated Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt, face amount | $ 125,000,000 | |||||||
Interest rate | 5.275% | |||||||
Proceeds from issuance of subordinated long-term debt | $ 123,000,000 | |||||||
Term Loan Due 5/17/21 | Unsecured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt, face amount | $ 100,000,000 | |||||||
Balloon payment | 75,000,000 | |||||||
Line of Credit | $750 Million Credit Facility | Unsecured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | $ 750,000,000 | |||||||
London Interbank Offered Rate (LIBOR) | Term Loan Due 5/17/21 | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread | 1.25% |
Debt - Short-Term Borrowings (D
Debt - Short-Term Borrowings (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 14, 2018 | |
Short-term Debt [Line Items] | ||||
Balance at end of period (at par value) | $ 1,686,462 | |||
Annualized interest rate | 2.93% | 1.78% | ||
Letters of credit outstanding | $ 155,000 | $ 177,000 | $ 155,000 | |
Remaining amount available under credit line | 292,900 | 248,750 | ||
Average balance outstanding during period | $ 368,228 | $ 323,429 | $ 301,550 | |
Daily-weighted average interest rate (annualized) | 2.40% | 1.30% | 0.83% | |
Maximum daily amount outstanding during period | $ 525,990 | $ 455,912 | $ 412,676 | |
Short-term Debt | ||||
Short-term Debt [Line Items] | ||||
Balance at end of period (at par value) | $ 302,100 | $ 324,250 |
Shareholders' Equity - Summary
Shareholders' Equity - Summary of Preferred and Common Share Activity (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Increase (Decrease) in Stockholders' Equity | |||
Common stock issued, beginning balance | 124,218,183 | ||
Treasury stock, beginning balance | (9,625,104) | ||
Grants of restricted stock | 177,493 | 169,870 | 186,961 |
Vesting of performance shares | 191,641 | 153,360 | 306,802 |
Issuance of common stock due to exercise of stock options | 897,622 | 1,661,808 | 2,184,169 |
Common stock issued, ending balance | 121,218,183 | 124,218,183 | |
Treasury stock, ending balance | (10,525,147) | (9,625,104) | |
Common Stock | |||
Increase (Decrease) in Stockholders' Equity | |||
Common stock issued, beginning balance | 124,218,183 | 127,218,183 | 130,218,183 |
Treasury stock, beginning balance | (9,625,104) | (9,187,075) | (7,848,231) |
Grants of restricted stock | 10,805 | 9,135 | 12,549 |
Forfeitures of restricted stock | 7,500 | ||
Issuance of common stock due to exercise of stock options | 897,622 | 1,661,808 | 2,184,169 |
Treasury stock acquired | (4,950,868) | (5,228,868) | (6,694,582) |
Retirement of treasury stock | 3,000,000 | 3,000,000 | 3,000,000 |
Common stock issued, ending balance | 121,218,183 | 124,218,183 | 127,218,183 |
Treasury stock, ending balance | (10,525,147) | (9,625,104) | (9,187,075) |
Performance Shares | |||
Increase (Decrease) in Stockholders' Equity | |||
Grants of restricted stock | 159,000 | 153,000 | 167,500 |
Performance Shares | Common Stock | |||
Increase (Decrease) in Stockholders' Equity | |||
Vesting of performance shares | 149,898 | 119,896 | 159,020 |
Shareholders' Equity - Share Re
Shareholders' Equity - Share Repurchase Program (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Torchmark Share Repurchase Program | |||
Equity, Class of Treasury Stock [Line Items] | |||
Shares Acquired | 4,406 | 4,126 | 5,208 |
Total Cost | $ 371,794 | $ 324,622 | $ 311,332 |
Average Price (in dollars per share) | $ 84.38 | $ 78.67 | $ 59.78 |
Share Repurchase for Dilution Purposes | |||
Equity, Class of Treasury Stock [Line Items] | |||
Shares Acquired | 571 | 1,103 | 1,487 |
Total Cost | $ 49,955 | $ 88,367 | $ 93,452 |
Average Price (in dollars per share) | $ 87.54 | $ 80.15 | $ 62.87 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Equity [Abstract] | |||
Dividends paid by subsidiaries to parent company | $ 448,000 | $ 454,000 | $ 438,000 |
Maximum amount of dividends expected to be available from subsidiaries without regulatory approval during next year | 396,000 | ||
Restricted net assets | 1,000,000 | ||
Retained earnings restricted by lenders' covenants | 3,800,000 | ||
Retained earnings | $ 5,213,468 | $ 4,806,208 |
Shareholders' Equity - Reconcil
Shareholders' Equity - Reconciliation of Basic and Diluted Weighted Average Shares Outstanding (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Equity [Abstract] | |||
Basic weighted average shares outstanding | 112,872,581 | 116,342,529 | 120,001,191 |
Weighted average dilutive options outstanding | 2,376,372 | 2,640,965 | 2,366,594 |
Diluted weighted average shares outstanding | 115,248,953 | 118,983,494 | 122,367,785 |
Antidilutive shares | 1,161,521 | 0 | 0 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Grant Contract and Vesting Periods (Details) - Equity Option | 12 Months Ended |
Dec. 31, 2018 | |
Directors | Director | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Contract Period | 7 years |
Directors | Director | 6 months | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 100.00% |
Employee 7 Year Grants | Employee | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Contract Period | 7 years |
Employee 7 Year Grants | Employee | 6 months | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 0.00% |
Employee 7 Year Grants | Employee | Yr 1 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 0.00% |
Employee 7 Year Grants | Employee | Yr 2 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 50.00% |
Employee 7 Year Grants | Employee | Yr 3 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 50.00% |
Employee 10 Year Grants | Employee | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Contract Period | 10 years |
Employee 10 Year Grants | Employee | 6 months | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 0.00% |
Employee 10 Year Grants | Employee | Yr 1 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 0.00% |
Employee 10 Year Grants | Employee | Yr 2 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 25.00% |
Employee 10 Year Grants | Employee | Yr 3 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 25.00% |
Employee 10 Year Grants | Employee | Yr 4 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 25.00% |
Employee 10 Year Grants | Employee | Yr 5 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 25.00% |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - shares | Feb. 27, 2018 | Feb. 21, 2017 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Incentive plan, shares available for grant | 9,422,760 | 9,422,760 | 2,964,320 | 5,088,461 | 6,872,282 | ||
Number of equity awards settled for cash | 0 | ||||||
Restricted stock units outstanding | 102,116,000 | 102,116,000 | 120,326,000 | 112,591,000 | |||
Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 3 years | ||||||
Settlement of performance shares | 149,898 | 119,896 | |||||
Minimum | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Performance shares target distribution | 0 | 0 | 0 | ||||
Maximum | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Performance shares target distribution | 318,000 | 318,000 | 306,000 | ||||
Employee | Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 5 years | ||||||
Director | Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 6 months | ||||||
Director | Restricted Stock Units (RSUs) | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 6 months | ||||||
Directors | Director | Equity Option | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Contract Period | 7 years | ||||||
Contract period | 7 years | ||||||
Employee 7 Year Grants | Employee | Equity Option | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Contract Period | 7 years | ||||||
Employee 10 Year Grants | Employee | Equity Option | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Contract Period | 10 years | ||||||
Contract period | 10 years |
Stock-Based Compensation - Anal
Stock-Based Compensation - Analysis of Shares Available for Grant (Detail) | 12 Months Ended | ||
Dec. 31, 2018shares | Dec. 31, 2017shares | Dec. 31, 2016shares | |
Activity by Share-based Payment Award | |||
Balance at January 1 (in shares) | 2,964,320 | 5,088,461 | 6,872,282 |
Cancellation of available shares from prior plans (in shares) | (184,000) | 0 | 0 |
Options expired and forfeited during year (in shares) | 41,317 | 26,488 | 8,518 |
Restricted stock expired and forfeited during year (in shares) | 0 | 46,500 | 0 |
Balance at December 31 (in shares) | 9,422,760 | 2,964,320 | 5,088,461 |
Stock Options | |||
Activity by Share-based Payment Award | |||
Options granted during year (in shares) | (1,262,037) | (1,328,513) | (1,306,306) |
Torchmark Corporation 2018 Incentive Plan | |||
Activity by Share-based Payment Award | |||
Approval of Torchmark Corporation 2018 Incentive Plan (in shares) | 8,984,000 | 0 | 0 |
Torchmark Corporation 2011 Incentive Plan | Restricted Stock, Restricted Stock Units And Performance Shares | |||
Activity by Share-based Payment Award | |||
Restricted stock, restricted stock units, and performance shares granted under the Torchmark Corporation 2011 Incentive Plan (in shares) | (1,120,840) | (868,616) | (486,033) |
Minimum | |||
Activity by Share-based Payment Award | |||
Ratio by which each grant of stock options reduces shares available for grant | 0.85 | ||
Ratio by which each grant of restricted stock reduces shares available for options | 3.1 | ||
Maximum | |||
Activity by Share-based Payment Award | |||
Ratio by which each grant of stock options reduces shares available for grant | 1 | ||
Ratio by which each grant of restricted stock reduces shares available for options | 3.88 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock Compensation Activity (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Stock-based compensation expense recognized | $ 39,792,000 | $ 37,034,000 | $ 26,326,000 |
Tax benefit recognized | 14,806,000 | 32,511,000 | |
Tax benefit recognized | 27,867,000 | ||
Stock-based compensation expense capitalized | $ 0 | $ 0 | $ 0 |
Stock-Based Compensation - Ad_2
Stock-Based Compensation - Additional Stock Compensation Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Unrecognized compensation | $ 38,627 | $ 31,309 |
Weighted average period of expected recognition (in years) | 9 months 22 days | 10 months 10 days |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Options Outstanding (Detail) - $ / shares | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Range of Exercise Prices, Minimum (in dollars per share) | $ 29.59 | |||
Range of Exercise Prices, Maximum (in dollars per share) | $ 90.21 | |||
Options Outstanding, Number Outstanding (in shares) | 7,203,765 | 6,753,801 | 6,973,591 | 7,734,841 |
Options Outstanding, Weighted- Average Remaining Contractual Life (Years) | 4 years 9 months 7 days | 4 years 10 months 21 days | ||
Options Outstanding, Weighted- Average Exercise Price (in dollars per share) | $ 61.72 | $ 53.59 | $ 44.64 | $ 38.84 |
Options Exercisable, Number Exercisable (in shares) | 3,393,090 | 2,928,979 | 3,115,847 | |
Options Exercisable, Weighted- Average Exercise Price (in dollars per share) | $ 48.18 | $ 43.79 | $ 36.81 | |
$29.59 - $37.40 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Range of Exercise Prices, Minimum (in dollars per share) | 29.59 | |||
Range of Exercise Prices, Maximum (in dollars per share) | $ 37.4 | |||
Options Outstanding, Number Outstanding (in shares) | 909,471 | |||
Options Outstanding, Weighted- Average Remaining Contractual Life (Years) | 1 year 6 months 26 days | |||
Options Outstanding, Weighted- Average Exercise Price (in dollars per share) | $ 36.21 | |||
Options Exercisable, Number Exercisable (in shares) | 909,471 | |||
Options Exercisable, Weighted- Average Exercise Price (in dollars per share) | $ 36.21 | |||
50.64 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Range of Exercise Prices, Minimum (in dollars per share) | 50.64 | |||
Range of Exercise Prices, Maximum (in dollars per share) | $ 50.64 | |||
Options Outstanding, Number Outstanding (in shares) | 1,308,101 | |||
Options Outstanding, Weighted- Average Remaining Contractual Life (Years) | 5 years 4 months 17 days | |||
Options Outstanding, Weighted- Average Exercise Price (in dollars per share) | $ 50.64 | |||
Options Exercisable, Number Exercisable (in shares) | 467,288 | |||
Options Exercisable, Weighted- Average Exercise Price (in dollars per share) | $ 50.64 | |||
50.69 - 51.62 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Range of Exercise Prices, Minimum (in dollars per share) | 50.69 | |||
Range of Exercise Prices, Maximum (in dollars per share) | $ 51.62 | |||
Options Outstanding, Number Outstanding (in shares) | 920,372 | |||
Options Outstanding, Weighted- Average Remaining Contractual Life (Years) | 2 years 7 months 28 days | |||
Options Outstanding, Weighted- Average Exercise Price (in dollars per share) | $ 50.70 | |||
Options Exercisable, Number Exercisable (in shares) | 859,552 | |||
Options Exercisable, Weighted- Average Exercise Price (in dollars per share) | $ 50.70 | |||
53.61 - 56.32 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Range of Exercise Prices, Minimum (in dollars per share) | 53.61 | |||
Range of Exercise Prices, Maximum (in dollars per share) | $ 56.32 | |||
Options Outstanding, Number Outstanding (in shares) | 1,251,337 | |||
Options Outstanding, Weighted- Average Remaining Contractual Life (Years) | 3 years 7 months 6 days | |||
Options Outstanding, Weighted- Average Exercise Price (in dollars per share) | $ 53.66 | |||
Options Exercisable, Number Exercisable (in shares) | 1,117,163 | |||
Options Exercisable, Weighted- Average Exercise Price (in dollars per share) | $ 53.66 | |||
73.92 - 77.26 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Range of Exercise Prices, Minimum (in dollars per share) | 73.92 | |||
Range of Exercise Prices, Maximum (in dollars per share) | $ 77.26 | |||
Options Outstanding, Number Outstanding (in shares) | 1,439,081 | |||
Options Outstanding, Weighted- Average Remaining Contractual Life (Years) | 6 years 2 months 9 days | |||
Options Outstanding, Weighted- Average Exercise Price (in dollars per share) | $ 77.24 | |||
Options Exercisable, Number Exercisable (in shares) | 10,843 | |||
Options Exercisable, Weighted- Average Exercise Price (in dollars per share) | $ 74.29 | |||
83.17 - 90.21 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Range of Exercise Prices, Minimum (in dollars per share) | 83.17 | |||
Range of Exercise Prices, Maximum (in dollars per share) | $ 90.21 | |||
Options Outstanding, Number Outstanding (in shares) | 1,375,403 | |||
Options Outstanding, Weighted- Average Remaining Contractual Life (Years) | 7 years 3 months 22 days | |||
Options Outstanding, Weighted- Average Exercise Price (in dollars per share) | $ 87.62 | |||
Options Exercisable, Number Exercisable (in shares) | 28,773 | |||
Options Exercisable, Weighted- Average Exercise Price (in dollars per share) | $ 88.44 |
Stock-Based Compensation - An_2
Stock-Based Compensation - Analysis of Option Activity (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Options | |||
Options Outstanding-beginning of year (in shares) | 6,753,801 | 6,973,591 | 7,734,841 |
Options Exercised (in shares) | (897,622) | (1,661,808) | (2,184,169) |
Options Expired and forfeited (in shares) | (41,317) | (26,488) | (8,518) |
Options Outstanding-end of year (in shares) | 7,203,765 | 6,753,801 | 6,973,591 |
Options Exercisable at end of year (in shares) | 3,393,090 | 2,928,979 | 3,115,847 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Weighted Average Exercise Price [Abstract] | |||
Outstanding-beginning of year, weighted average exercise price (in dollars per share) | $ 53.59 | $ 44.64 | $ 38.84 |
Options exercised in the period - weighted average exercise price (in dollars per share) | 40.21 | 36.84 | 28.08 |
Options expired and forfeited in the period - weighted average exercise price (in dollars per share) | 70.90 | 57.94 | 39.35 |
Outstanding-end of year, weighted average exercise price (in dollars per share) | 61.72 | 53.59 | 44.64 |
Exercisable at end of year, weighted average exercise price (in dollars per share) | $ 48.18 | $ 43.79 | $ 36.81 |
7-year term | |||
Options | |||
Options Granted (in shares) | 845,773 | 933,286 | 834,212 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Weighted Average Exercise Price [Abstract] | |||
Options granted in the period- weighted average exercise price (in dollars per share) | $ 87.63 | $ 77.19 | $ 50.78 |
10-year term | |||
Options | |||
Options Granted (in shares) | 543,130 | 535,220 | 597,225 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Weighted Average Exercise Price [Abstract] | |||
Options granted in the period- weighted average exercise price (in dollars per share) | $ 87.60 | $ 77.26 | $ 50.64 |
Stock-Based Compensation - Su_3
Stock-Based Compensation - Summary of Additional Information of Stock Option Activity (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Weighted-average remaining contractual term (in years) | 4 years 9 months 7 days | 4 years 10 months 21 days |
Aggregate intrinsic value | $ 114,161 | $ 231,277 |
Weighted-average remaining contractual term (in years) | 2 years 10 months 21 days | 2 years 11 months 27 days |
Aggregate intrinsic value | $ 89,817 | $ 137,424 |
Stock-Based Compensation - Sele
Stock-Based Compensation - Selected Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Weighted-average grant-date fair value of options granted (in dollars per share) | $ 15.65 | $ 12.88 | $ 9.04 |
Intrinsic value of options exercised | $ 42,517 | $ 70,948 | $ 73,995 |
Cash received from options exercised | 36,091 | 61,215 | 61,329 |
Actual tax benefit received | $ 8,929 | $ 24,832 | $ 25,898 |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Additional Information on Unvested Options (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted-average remaining contractual term (in years) | 4 years 9 months 7 days | 4 years 10 months 21 days |
Aggregate intrinsic value | $ 114,161 | $ 231,277 |
Unvested Options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares outstanding (in shares) | 3,810,675 | 3,824,822 |
Weighted-average exercise price (in dollars per share) | $ 73.78 | $ 61.10 |
Weighted-average remaining contractual term (in years) | 6 years 5 months 12 days | 6 years 4 months 2 days |
Aggregate intrinsic value | $ 24,344 | $ 113,246 |
Stock-Based Compensation - Su_4
Stock-Based Compensation - Summary of Restricted Stock and Restricted Stock Units Granted (Detail) - USD ($) $ / shares in Units, $ in Thousands | Feb. 28, 2019 | Feb. 27, 2018 | Feb. 21, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares (in shares) | 177,493 | 169,870 | 186,961 | |||
Assumed adjustment for performance objectives (in shares) | 179,415 | 106,084 | (35,073) | |||
Performance Shares | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Settlement of performance shares | 149,898 | 119,896 | ||||
Shares (in shares) | 159,000 | 153,000 | 167,500 | |||
Price per share (in dollars per share) | $ 87.60 | $ 77.26 | $ 50.64 | |||
Assumed adjustment for performance objectives (in shares) | 179,415 | 106,084 | (35,073) | |||
Aggregate value | $ 13,928 | $ 11,821 | $ 8,482 | |||
Percent vested | 0.00% | 0.00% | 0.00% | |||
Executive Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares (in shares) | 0 | 0 | 0 | |||
Price per share (in dollars per share) | $ 0 | |||||
Assumed adjustment for performance objectives (in shares) | 0 | 0 | 0 | |||
Directors Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares (in shares) | 10,805 | 9,135 | 12,549 | |||
Price per share (in dollars per share) | $ 88.19 | $ 73.92 | $ 57.39 | |||
Assumed adjustment for performance objectives (in shares) | 0 | 0 | 0 | |||
Aggregate value | $ 953 | $ 675 | $ 720 | |||
Percent vested | 100.00% | 100.00% | 85.00% | |||
Directors Restricted Stock Units Including Dividend Equivalents | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares (in shares) | 7,688 | 7,735 | 6,912 | |||
Price per share (in dollars per share) | $ 89.15 | $ 74.45 | $ 56.74 | |||
Aggregate value | $ 685 | $ 576 | $ 392 | |||
Percent vested | 100.00% | 100.00% | 100.00% | |||
Subsequent Event | Performance Shares | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Settlement of performance shares | 311,399 |
Stock-Based Compensation - An_3
Stock-Based Compensation - Analysis of Unvested Restricted Stock (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares | |||
Beginning Balance (in shares) | 599,362 | 491,768 | 646,682 |
Grants (in shares) | 177,493 | 169,870 | 186,961 |
Additional performance shares | 179,415 | 106,084 | (35,073) |
Restriction lapses (in shares) | (191,641) | (153,360) | (306,802) |
Forfeitures (in shares) | 0 | (15,000) | 0 |
Ending Balance (in shares) | 764,629 | 599,362 | 491,768 |
Executive Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares | |||
Beginning Balance (in shares) | 35,250 | 57,450 | 187,665 |
Grants (in shares) | 0 | 0 | 0 |
Additional performance shares | 0 | 0 | 0 |
Restriction lapses (in shares) | (23,250) | (14,700) | (130,215) |
Forfeitures (in shares) | 0 | (7,500) | 0 |
Ending Balance (in shares) | 12,000 | 35,250 | 57,450 |
Executive Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares | |||
Beginning Balance (in shares) | 564,112 | 432,424 | 459,017 |
Grants (in shares) | 159,000 | 153,000 | 167,500 |
Additional performance shares | 179,415 | 106,084 | (35,073) |
Restriction lapses (in shares) | (149,898) | (119,896) | (159,020) |
Forfeitures (in shares) | 0 | (7,500) | 0 |
Ending Balance (in shares) | 752,629 | 564,112 | 432,424 |
Directors Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares | |||
Beginning Balance (in shares) | 0 | 1,894 | 0 |
Grants (in shares) | 10,805 | 9,135 | 12,549 |
Additional performance shares | 0 | 0 | 0 |
Restriction lapses (in shares) | (10,805) | (11,029) | (10,655) |
Forfeitures (in shares) | 0 | 0 | 0 |
Ending Balance (in shares) | 0 | 0 | 1,894 |
Directors Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares | |||
Beginning Balance (in shares) | 0 | 0 | 0 |
Grants (in shares) | 7,688 | 7,735 | 6,912 |
Additional performance shares | 0 | 0 | 0 |
Restriction lapses (in shares) | (7,688) | (7,735) | (6,912) |
Forfeitures (in shares) | 0 | 0 | 0 |
Ending Balance (in shares) | 0 | 0 | 0 |
Stock-Based Compensation - Sc_3
Stock-Based Compensation - Schedule of Weighted-Average Grant-Date Fair Value of Unvested Restricted Stock (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Executive Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares | |||
Grant-date fair value per share at January 1, 2016 (in dollars per share) | $ 41.93 | ||
Grants (in dollars per share) | 0 | ||
Restriction lapses (in dollars per share) | (37.40) | ||
Forfeitures (in dollars per share) | 0 | ||
Grant-date fair value per share at December 31, 2016 (in dollars per share) | 50.69 | $ 41.93 | |
Executive Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares | |||
Grant-date fair value per share at January 1, 2016 (in dollars per share) | 56.64 | ||
Grants (in dollars per share) | 87.60 | ||
Estimated additional performance shares (in dollars per share) | 70.39 | ||
Restriction lapses (in dollars per share) | (53.61) | ||
Forfeitures (in dollars per share) | 0 | ||
Grant-date fair value per share at December 31, 2016 (in dollars per share) | 67.06 | 56.64 | |
Directors Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares | |||
Grant-date fair value per share at January 1, 2016 (in dollars per share) | 0 | ||
Grants (in dollars per share) | 88.19 | 73.92 | $ 57.39 |
Restriction lapses (in dollars per share) | (88.19) | ||
Grant-date fair value per share at December 31, 2016 (in dollars per share) | 0 | $ 0 | |
Directors Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares | |||
Grants (in dollars per share) | 89.33 | ||
Restriction lapses (in dollars per share) | $ (89.33) |
Business Segments - Additional
Business Segments - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2018segment | |
Segment Reporting [Abstract] | |
Number of segments | 4 |
Business Segments - Schedule of
Business Segments - Schedule of Segment Premium Revenue by Each Marketing Groups (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Segment Reporting Information [Line Items] | |||
Amount | $ 3,421,906 | $ 3,282,935 | $ 3,137,034 |
% of Total | 100.00% | 100.00% | 100.00% |
American Income Exclusive | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 1,174,646 | $ 1,088,315 | $ 997,737 |
% of Total | 34.00% | 33.00% | 32.00% |
Direct Response | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 905,232 | $ 886,375 | $ 853,158 |
% of Total | 26.00% | 27.00% | 27.00% |
Liberty National Exclusive | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 470,256 | $ 470,842 | $ 472,274 |
% of Total | 14.00% | 14.00% | 15.00% |
United American Independent | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 392,539 | $ 376,690 | $ 368,786 |
% of Total | 12.00% | 12.00% | 12.00% |
Family Heritage Exclusive | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 276,776 | $ 256,727 | $ 238,941 |
% of Total | 8.00% | 8.00% | 8.00% |
Other | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 202,457 | $ 203,986 | $ 206,138 |
% of Total | 6.00% | 6.00% | 6.00% |
Life | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 2,406,555 | $ 2,306,547 | $ 2,189,333 |
% of Total | 100.00% | 100.00% | 100.00% |
Life | American Income Exclusive | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 1,081,333 | $ 999,279 | $ 913,355 |
% of Total | 45.00% | 43.00% | 42.00% |
Life | Direct Response | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 828,935 | $ 812,907 | $ 782,765 |
% of Total | 34.00% | 35.00% | 36.00% |
Life | Liberty National Exclusive | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 278,878 | $ 274,635 | $ 270,476 |
% of Total | 12.00% | 12.00% | 12.00% |
Life | United American Independent | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 11,451 | $ 12,547 | $ 13,733 |
% of Total | 1.00% | 1.00% | 1.00% |
Life | Family Heritage Exclusive | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 3,501 | $ 3,193 | $ 2,866 |
% of Total | 0.00% | ||
Life | Other | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 202,457 | $ 203,986 | $ 206,138 |
% of Total | 8.00% | 9.00% | 9.00% |
Health | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 1,015,339 | $ 976,373 | $ 947,663 |
% of Total | 100.00% | 100.00% | 100.00% |
Health | American Income Exclusive | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 93,313 | $ 89,036 | $ 84,382 |
% of Total | 9.00% | 9.00% | 9.00% |
Health | Direct Response | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 76,297 | $ 73,468 | $ 70,393 |
% of Total | 7.00% | 8.00% | 7.00% |
Health | Liberty National Exclusive | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 191,378 | $ 196,207 | $ 201,798 |
% of Total | 19.00% | 20.00% | 21.00% |
Health | United American Independent | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 381,076 | $ 364,128 | $ 355,015 |
% of Total | 38.00% | 37.00% | 38.00% |
Health | Family Heritage Exclusive | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 273,275 | $ 253,534 | $ 236,075 |
% of Total | 27.00% | 26.00% | 25.00% |
Annuity | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 12 | $ 15 | $ 38 |
% of Total | 100.00% | 100.00% | 100.00% |
Annuity | United American Independent | |||
Segment Reporting Information [Line Items] | |||
Amount | $ 12 | $ 15 | $ 38 |
% of Total | 100.00% | 100.00% | 100.00% |
Business Segments - Reconciliat
Business Segments - Reconciliation of Segment Operating Information to Consolidated Statement of Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenue: | |||||||||||
Premium | $ 857,071 | $ 860,750 | $ 853,979 | $ 850,106 | $ 826,473 | $ 819,217 | $ 816,614 | $ 820,631 | $ 3,421,906 | $ 3,282,935 | $ 3,137,034 |
Net investment income | 224,233 | 221,627 | 218,568 | 218,084 | 212,955 | 213,872 | 212,776 | 208,282 | 882,512 | 847,885 | 806,903 |
Other income | 1,137 | 1,142 | 1,375 | ||||||||
Total revenue | 4,305,555 | 4,131,962 | 3,945,312 | ||||||||
Expenses: | |||||||||||
Policy benefits | 569,120 | 567,856 | 568,377 | 569,889 | 562,465 | 551,219 | 556,415 | 557,776 | 2,275,242 | 2,227,875 | 2,128,748 |
Required interest on reserves | 0 | 0 | 0 | ||||||||
Required interest on deferred acquisition costs | 0 | 0 | 0 | ||||||||
Amortization of acquisition costs | 128,501 | 129,492 | 129,077 | 129,620 | 120,040 | 122,334 | 122,121 | 125,908 | 516,690 | 490,403 | 469,063 |
Commissions, premium taxes, and non-deferred acquisition costs | 278,487 | 264,860 | 249,174 | ||||||||
Insurance administrative expense | 227,531 | 210,590 | 197,151 | ||||||||
Parent expense | 12,262 | 9,631 | 8,587 | ||||||||
Stock-based compensation expense | 39,792 | 37,034 | 26,326 | ||||||||
Interest expense | 90,076 | 84,532 | 83,345 | ||||||||
Total benefits and expenses | 3,440,080 | 3,324,925 | 3,162,394 | ||||||||
Subtotal | 865,475 | 807,037 | 782,918 | ||||||||
Non-operating items | 5,168 | 14,128 | 4,348 | ||||||||
Measure of segment profitability (pretax) | 870,643 | 821,165 | 787,266 | ||||||||
Realized gain (loss)—investments | (16,600) | 1,032 | 11,813 | 1,951 | 17,469 | 12,595 | (705) | (5,748) | 9,274 | 27,652 | (10,683) |
Realized loss-redemption of debt | (11,078) | (4,041) | |||||||||
Administrative settlements | (3,590) | (8,659) | (3,795) | ||||||||
Non-operating fees | (1,578) | (288) | (553) | ||||||||
Guaranty fund assessments | (1,801) | ||||||||||
Stock-based compensation adjustment—Tax reform adjustment | (3,380) | ||||||||||
Income before income taxes | $ 203,635 | $ 220,330 | $ 226,864 | $ 212,842 | $ 216,371 | $ 220,610 | $ 201,926 | $ 191,741 | 863,671 | 830,648 | 772,235 |
Administrative settlements, net of tax | 5,600 | ||||||||||
Guaranty fund assessments, net of tax | 1,200 | ||||||||||
Stock-based compensation adjustment-Tax reform adjustment, net of tax | 2,200 | ||||||||||
Operating Segments | Life | |||||||||||
Revenue: | |||||||||||
Premium | 2,406,555 | 2,306,547 | 2,189,333 | ||||||||
Total revenue | 2,406,555 | 2,306,547 | 2,189,333 | ||||||||
Expenses: | |||||||||||
Policy benefits | 1,591,790 | 1,549,602 | 1,475,477 | ||||||||
Required interest on reserves | (636,040) | (607,007) | (577,827) | ||||||||
Required interest on deferred acquisition costs | 194,297 | 186,236 | 178,946 | ||||||||
Amortization of acquisition costs | 414,200 | 396,268 | 374,499 | ||||||||
Commissions, premium taxes, and non-deferred acquisition costs | 190,007 | 177,111 | 164,476 | ||||||||
Total benefits and expenses | 1,754,254 | 1,702,210 | 1,615,571 | ||||||||
Subtotal | 652,301 | 604,337 | 573,762 | ||||||||
Measure of segment profitability (pretax) | 652,301 | 604,337 | 573,762 | ||||||||
Operating Segments | Health | |||||||||||
Revenue: | |||||||||||
Premium | 1,015,339 | 976,373 | 947,663 | ||||||||
Total revenue | 1,015,339 | 976,373 | 947,663 | ||||||||
Expenses: | |||||||||||
Policy benefits | 649,188 | 628,640 | 612,725 | ||||||||
Required interest on reserves | (83,243) | (77,792) | (73,382) | ||||||||
Required interest on deferred acquisition costs | 24,412 | 23,454 | 23,060 | ||||||||
Amortization of acquisition costs | 100,376 | 96,519 | 90,385 | ||||||||
Commissions, premium taxes, and non-deferred acquisition costs | 88,553 | 86,044 | 84,819 | ||||||||
Total benefits and expenses | 779,286 | 756,865 | 737,607 | ||||||||
Subtotal | 236,053 | 219,508 | 210,056 | ||||||||
Measure of segment profitability (pretax) | 236,053 | 219,508 | 210,056 | ||||||||
Operating Segments | Annuity | |||||||||||
Revenue: | |||||||||||
Premium | 12 | 15 | 38 | ||||||||
Total revenue | 12 | 15 | 38 | ||||||||
Expenses: | |||||||||||
Policy benefits | 34,264 | 35,836 | 36,751 | ||||||||
Required interest on reserves | (47,357) | (49,571) | (51,131) | ||||||||
Required interest on deferred acquisition costs | 589 | 690 | 807 | ||||||||
Amortization of acquisition costs | 2,114 | 2,466 | 4,179 | ||||||||
Commissions, premium taxes, and non-deferred acquisition costs | 26 | 32 | 38 | ||||||||
Total benefits and expenses | (10,364) | (10,547) | (9,356) | ||||||||
Subtotal | 10,376 | 10,562 | 9,394 | ||||||||
Measure of segment profitability (pretax) | 10,376 | 10,562 | 9,394 | ||||||||
Operating Segments | Investment | |||||||||||
Revenue: | |||||||||||
Net investment income | 882,512 | 847,885 | 806,903 | ||||||||
Total revenue | 882,512 | 847,885 | 806,903 | ||||||||
Expenses: | |||||||||||
Required interest on reserves | 766,640 | 734,370 | 702,340 | ||||||||
Required interest on deferred acquisition costs | (219,298) | (210,380) | (202,813) | ||||||||
Interest expense | 90,076 | 84,532 | 83,345 | ||||||||
Total benefits and expenses | 637,418 | 608,522 | 582,872 | ||||||||
Subtotal | 245,094 | 239,363 | 224,031 | ||||||||
Measure of segment profitability (pretax) | 245,094 | 239,363 | 224,031 | ||||||||
Operating Segments | Corporate & Other | |||||||||||
Revenue: | |||||||||||
Other income | 1,236 | 1,270 | 1,534 | ||||||||
Total revenue | 1,236 | 1,270 | 1,534 | ||||||||
Expenses: | |||||||||||
Insurance administrative expense | 223,941 | 210,590 | 196,598 | ||||||||
Parent expense | 10,684 | 9,631 | 8,587 | ||||||||
Stock-based compensation expense | 39,792 | 33,654 | 26,326 | ||||||||
Total benefits and expenses | 274,417 | 253,875 | 231,511 | ||||||||
Subtotal | (273,181) | (252,605) | (229,977) | ||||||||
Measure of segment profitability (pretax) | (273,181) | (252,605) | (229,977) | ||||||||
Adjustments | |||||||||||
Revenue: | |||||||||||
Other income | (99) | (128) | (159) | ||||||||
Total revenue | (99) | (128) | (159) | ||||||||
Expenses: | |||||||||||
Policy benefits | 13,797 | 3,795 | |||||||||
Amortization of acquisition costs | (4,850) | ||||||||||
Commissions, premium taxes, and non-deferred acquisition costs | (99) | 1,673 | (159) | ||||||||
Insurance administrative expense | 3,590 | 553 | |||||||||
Parent expense | 1,578 | ||||||||||
Stock-based compensation expense | 3,380 | 0 | |||||||||
Interest expense | 0 | ||||||||||
Total benefits and expenses | 5,069 | 14,000 | 4,189 | ||||||||
Subtotal | (5,168) | (14,128) | (4,348) | ||||||||
Non-operating items | 5,168 | 14,128 | 4,348 | ||||||||
Measure of segment profitability (pretax) | $ 0 | $ 0 | $ 0 |
Business Segments - Assets by S
Business Segments - Assets by Segment (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Cash and invested assets | $ 17,239,570 | $ 17,853,047 | ||
Accrued investment income | 243,003 | 233,453 | ||
Deferred acquisition costs | 4,137,925 | 3,958,063 | $ 3,783,158 | $ 3,617,135 |
Goodwill | 441,591 | 441,591 | ||
Other assets | 1,033,633 | 988,831 | ||
Total assets | 23,095,722 | 23,474,985 | ||
Life | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Deferred acquisition costs | 3,580,693 | 3,423,296 | ||
Goodwill | 309,609 | 309,609 | ||
Total assets | 3,890,302 | 3,732,905 | ||
Health | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Deferred acquisition costs | 548,640 | 529,068 | ||
Goodwill | 131,982 | 131,982 | ||
Total assets | 680,622 | 661,050 | ||
Annuity | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Deferred acquisition costs | 8,592 | 5,699 | ||
Total assets | 8,592 | 5,699 | ||
Investment | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Cash and invested assets | 17,239,570 | 17,853,047 | ||
Accrued investment income | 243,003 | 233,453 | ||
Total assets | 17,482,573 | 18,086,500 | ||
Other | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Other assets | 1,033,633 | 988,831 | ||
Total assets | $ 1,033,633 | $ 988,831 |
Business Segments - Other Balan
Business Segments - Other Balances by Segment (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||
Future policy benefits | $ 13,953,826 | $ 13,439,472 |
Unearned and advance premiums | 61,208 | 61,430 |
Policy claims and other benefits payable | 350,826 | 333,294 |
Debt | 1,665,033 | 1,460,268 |
Other | 1,649,652 | 1,949,100 |
Total | 17,680,545 | 17,243,564 |
Life | ||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||
Future policy benefits | 10,847,356 | 10,353,286 |
Unearned and advance premiums | 17,850 | 16,927 |
Policy claims and other benefits payable | 196,298 | 186,429 |
Total | 11,061,504 | 10,556,642 |
Health | ||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||
Future policy benefits | 1,927,732 | 1,831,338 |
Unearned and advance premiums | 43,358 | 44,503 |
Policy claims and other benefits payable | 154,528 | 146,865 |
Total | 2,125,618 | 2,022,706 |
Annuity | ||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||
Future policy benefits | 1,178,738 | 1,254,848 |
Total | 1,178,738 | 1,254,848 |
Investment | ||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||
Debt | 1,665,033 | 1,460,268 |
Total | 1,665,033 | 1,460,268 |
Other | ||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||
Other | 1,649,652 | 1,949,100 |
Total | $ 1,649,652 | $ 1,949,100 |
Selected Quarterly Data (Unau_3
Selected Quarterly Data (Unaudited) - Schedule of Selected Quarterly Data (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Premium income | $ 857,071 | $ 860,750 | $ 853,979 | $ 850,106 | $ 826,473 | $ 819,217 | $ 816,614 | $ 820,631 | $ 3,421,906 | $ 3,282,935 | $ 3,137,034 |
Net investment income | 224,233 | 221,627 | 218,568 | 218,084 | 212,955 | 213,872 | 212,776 | 208,282 | 882,512 | 847,885 | 806,903 |
Realized gains (losses) | (16,600) | 1,032 | 11,813 | 1,951 | 17,469 | 12,595 | (705) | (5,748) | 9,274 | 27,652 | (10,683) |
Total revenue | 1,064,737 | 1,083,802 | 1,084,776 | 1,070,436 | 1,056,899 | 1,046,015 | 1,029,078 | 1,023,581 | 4,303,751 | 4,155,573 | 3,934,629 |
Policyholder benefits | 569,120 | 567,856 | 568,377 | 569,889 | 562,465 | 551,219 | 556,415 | 557,776 | 2,275,242 | 2,227,875 | 2,128,748 |
Amortization of deferred acquisition costs | 128,501 | 129,492 | 129,077 | 129,620 | 120,040 | 122,334 | 122,121 | 125,908 | 516,690 | 490,403 | 469,063 |
Pretax income from continuing operations | 203,635 | 220,330 | 226,864 | 212,842 | 216,371 | 220,610 | 201,926 | 191,741 | 863,671 | 830,648 | 772,235 |
Income from continuing operations | 164,706 | 178,700 | 184,393 | 173,711 | 1,027,376 | 153,346 | 140,363 | 137,178 | 701,510 | 1,458,263 | 539,590 |
Income (loss) from discontinued operations | 11 | 24 | 32 | (111) | (30) | (12) | (90) | (3,637) | (44) | (3,769) | 10,189 |
Net income | $ 164,717 | $ 178,724 | $ 184,425 | $ 173,600 | $ 1,027,346 | $ 153,334 | $ 140,273 | $ 133,541 | $ 701,466 | $ 1,454,494 | $ 549,779 |
Basic net income (loss) per common share: | |||||||||||
Continuing operations (in dollars per share) | $ 1.48 | $ 1.59 | $ 1.63 | $ 1.52 | $ 8.93 | $ 1.32 | $ 1.20 | $ 1.16 | $ 6.22 | $ 12.53 | $ 4.50 |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | 0 | 0 | 0 | 0 | (0.03) | 0 | (0.03) | 0.08 |
Total basic net income per common share (in dollars per share) | 1.48 | 1.59 | 1.63 | 1.52 | 8.93 | 1.32 | 1.20 | 1.13 | 6.22 | 12.50 | 4.58 |
Diluted net income (loss) per common share: | |||||||||||
Continuing operations (in dollars per share) | 1.45 | 1.55 | 1.59 | 1.49 | 8.71 | 1.29 | 1.18 | 1.14 | 6.09 | 12.26 | 4.41 |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | 0 | 0 | 0 | 0 | (0.03) | 0 | (0.04) | 0.08 |
Total diluted net income per common share (in dollars per share) | $ 1.45 | $ 1.55 | $ 1.59 | $ 1.49 | $ 8.71 | $ 1.29 | $ 1.18 | $ 1.11 | $ 6.09 | $ 12.22 | $ 4.49 |
Schedule II. Condensed Financ_2
Schedule II. Condensed Financial Information of Registrant (Condensed Balance Sheets) (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Assets: | ||||
Short-term investments | $ 63,288 | $ 127,071 | ||
Total investments | 17,118,544 | 17,734,484 | ||
Cash | 121,026 | 118,563 | $ 76,163 | $ 61,383 |
Other assets | 549,899 | 528,536 | ||
Total assets | 23,095,722 | 23,474,985 | ||
Liabilities: | ||||
Short-term debt | 307,848 | 328,067 | ||
Long-term debt | 1,357,185 | 1,132,201 | ||
Other liabilities | 453,270 | 489,609 | ||
Total liabilities | 17,680,545 | 17,243,564 | ||
Shareholders’ equity: | ||||
Preferred stock | 0 | 0 | ||
Common stock | 121,218 | 124,218 | ||
Additional paid-in capital | 524,414 | 508,476 | ||
Accumulated other comprehensive income | 319,475 | 1,424,274 | ||
Retained earnings | 5,213,468 | 4,806,208 | ||
Treasury stock | (763,398) | (631,755) | ||
Total shareholders’ equity | 5,415,177 | 6,231,421 | 4,566,861 | 4,055,552 |
Total liabilities and shareholders’ equity | 23,095,722 | 23,474,985 | ||
Parent Company | ||||
Assets: | ||||
Long-term investments | 29,603 | 35,562 | ||
Short-term investments | 21 | 5,624 | ||
Total investments | 29,624 | 41,186 | ||
Cash | 760 | 1,008 | $ 0 | $ 0 |
Investment in affiliates | 7,128,588 | 7,763,704 | ||
Due from affiliates | 96,110 | 95,920 | ||
Taxes receivable from affiliates | 50,656 | 63,099 | ||
Other assets | 152,103 | 135,616 | ||
Total assets | 7,457,841 | 8,100,533 | ||
Liabilities: | ||||
Short-term debt | 307,848 | 328,067 | ||
Long-term debt | 1,507,000 | 1,281,971 | ||
Due to affiliates | 3,002 | 8,002 | ||
Other liabilities | 224,814 | 251,072 | ||
Total liabilities | 2,042,664 | 1,869,112 | ||
Shareholders’ equity: | ||||
Preferred stock | 351 | 351 | ||
Common stock | 121,218 | 124,218 | ||
Additional paid-in capital | 874,925 | 858,987 | ||
Accumulated other comprehensive income | 319,475 | 1,424,274 | ||
Retained earnings | 5,213,468 | 4,806,208 | ||
Treasury stock | (1,114,260) | (982,617) | ||
Total shareholders’ equity | 5,415,177 | 6,231,421 | ||
Total liabilities and shareholders’ equity | $ 7,457,841 | $ 8,100,533 |
Schedule II. Condensed Financ_3
Schedule II. Condensed Financial Information of Registrant (Condensed Statements of Operations) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Condensed Financial Statements, Captions [Line Items] | |||||||||||
Net investment income | $ 224,233 | $ 221,627 | $ 218,568 | $ 218,084 | $ 212,955 | $ 213,872 | $ 212,776 | $ 208,282 | $ 882,512 | $ 847,885 | $ 806,903 |
Realized gains (losses) | (16,600) | 1,032 | 11,813 | 1,951 | 17,469 | 12,595 | (705) | (5,748) | 9,274 | 27,652 | (10,683) |
Total revenue | 1,064,737 | 1,083,802 | 1,084,776 | 1,070,436 | 1,056,899 | 1,046,015 | 1,029,078 | 1,023,581 | 4,303,751 | 4,155,573 | 3,934,629 |
General operating expenses | 279,585 | 257,255 | 232,064 | ||||||||
Interest expense | 90,076 | 84,532 | 83,345 | ||||||||
Total benefits and expenses | 3,440,080 | 3,324,925 | 3,162,394 | ||||||||
Income before income taxes | 203,635 | 220,330 | 226,864 | 212,842 | 216,371 | 220,610 | 201,926 | 191,741 | 863,671 | 830,648 | 772,235 |
Income taxes | (162,161) | 627,615 | (232,645) | ||||||||
Net income | $ 164,717 | $ 178,724 | $ 184,425 | $ 173,600 | $ 1,027,346 | $ 153,334 | $ 140,273 | $ 133,541 | 701,466 | 1,454,494 | 549,779 |
Other comprehensive income (loss): | |||||||||||
Comprehensive income (loss) | (403,333) | 2,048,794 | 895,406 | ||||||||
Parent Company | |||||||||||
Condensed Financial Statements, Captions [Line Items] | |||||||||||
Net investment income | 28,077 | 26,130 | 25,352 | ||||||||
Realized gains (losses) | (11,078) | (2,791) | 0 | ||||||||
Total revenue | 16,999 | 23,339 | 25,352 | ||||||||
General operating expenses | 65,762 | 61,447 | 52,613 | ||||||||
Reimbursements from affiliates | (61,620) | (52,776) | (54,288) | ||||||||
Interest expense | 94,159 | 88,474 | 86,853 | ||||||||
Total benefits and expenses | 98,301 | 97,145 | 85,178 | ||||||||
Income before income taxes | (81,302) | (73,806) | (59,826) | ||||||||
Income taxes | 15,262 | (9,874) | 23,479 | ||||||||
Net operating loss before equity in earnings of affiliates | (66,040) | (83,680) | (36,347) | ||||||||
Equity in earnings of affiliates, net of tax | 767,506 | 1,538,174 | 586,126 | ||||||||
Net income | 701,466 | 1,454,494 | 549,779 | ||||||||
Other comprehensive income (loss): | |||||||||||
Attributable to Parent Company | 23,805 | (8,409) | (11,314) | ||||||||
Attributable to affiliates | (1,128,604) | 602,709 | 356,941 | ||||||||
Comprehensive income (loss) | $ (403,333) | $ 2,048,794 | $ 895,406 |
Schedule II. Condensed Financ_4
Schedule II. Condensed Financial Information of Registrant (Condensed Statement of Cash Flows) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Condensed Financial Statements, Captions [Line Items] | |||||||||||
Net income | $ 164,717 | $ 178,724 | $ 184,425 | $ 173,600 | $ 1,027,346 | $ 153,334 | $ 140,273 | $ 133,541 | $ 701,466 | $ 1,454,494 | $ 549,779 |
Other, net | 4,463 | 67,933 | 20,079 | ||||||||
Cash provided from (used for) operating activities | 1,277,647 | 1,429,058 | 1,398,708 | ||||||||
Cash provided from (used for) investing activities: | |||||||||||
Net decrease (increase) in short-term investments | 63,783 | (55,031) | (17,274) | ||||||||
Additions to properties | (45,092) | (20,285) | (25,162) | ||||||||
Cash provided from (used for) investing activities | (896,223) | (926,824) | (1,062,436) | ||||||||
Cash provided from (used for) financing activities: | |||||||||||
Repayment of debt | (327,762) | (126,875) | (250,000) | ||||||||
Proceeds from issuance of debt | 550,000 | 125,000 | 400,000 | ||||||||
Payment for debt issuance costs | (6,969) | (1,661) | (9,638) | ||||||||
Net issuance (repayment) of commercial paper | (22,719) | 61,092 | 22,224 | ||||||||
Issuance of stock | 36,091 | 61,215 | 61,329 | ||||||||
Acquisitions of treasury stock | (421,749) | (412,989) | (404,784) | ||||||||
Payment of dividends | (71,421) | (68,831) | (66,931) | ||||||||
Cash provided from (used for) financing activities | (391,520) | (453,981) | (319,791) | ||||||||
Increase (decrease) in cash | 2,463 | 42,400 | 14,780 | ||||||||
Cash at beginning of year | 118,563 | 76,163 | 118,563 | 76,163 | 61,383 | ||||||
Cash at end of year | 121,026 | 118,563 | 121,026 | 118,563 | 76,163 | ||||||
Parent Company | |||||||||||
Condensed Financial Statements, Captions [Line Items] | |||||||||||
Net income | 701,466 | 1,454,494 | 549,779 | ||||||||
Equity in earnings of affiliates | (767,506) | (1,538,174) | (586,126) | ||||||||
Cash dividends from subsidiaries | 448,142 | 453,904 | 437,566 | ||||||||
Other, net | 64,734 | 52,957 | (6,718) | ||||||||
Cash provided from (used for) operating activities | 446,836 | 423,181 | 394,501 | ||||||||
Cash provided from (used for) investing activities: | |||||||||||
Net decrease (increase) in short-term investments | 5,603 | (5,624) | (3,466) | ||||||||
Investment in subsidiaries | (140,000) | (31,000) | (35,000) | ||||||||
Additions to properties | (19,888) | (7,230) | (21,965) | ||||||||
Loaned money to affiliates | (584,000) | (180,000) | (363,056) | ||||||||
Repayments from affiliates | 584,000 | 180,000 | 318,056 | ||||||||
Cash provided from (used for) investing activities | (154,285) | (43,854) | (105,431) | ||||||||
Cash provided from (used for) financing activities: | |||||||||||
Repayment of debt | (327,762) | (126,875) | (250,000) | ||||||||
Proceeds from issuance of debt | 550,000 | 125,000 | 400,000 | ||||||||
Payment for debt issuance costs | (6,969) | (1,661) | (9,638) | ||||||||
Net issuance (repayment) of commercial paper | (22,719) | 61,092 | 22,224 | ||||||||
Issuance of stock | 36,091 | 61,215 | 61,329 | ||||||||
Acquisitions of treasury stock | (421,749) | (412,989) | (404,784) | ||||||||
Borrowed money from affiliate | 197,690 | 278,500 | 60,000 | ||||||||
Repayments to affiliates | (202,690) | (270,500) | (78,000) | ||||||||
Payment of dividends | (94,691) | (92,101) | (90,201) | ||||||||
Cash provided from (used for) financing activities | (292,799) | (378,319) | (289,070) | ||||||||
Increase (decrease) in cash | (248) | 1,008 | 0 | ||||||||
Cash at beginning of year | $ 1,008 | $ 0 | 1,008 | 0 | 0 | ||||||
Cash at end of year | $ 760 | $ 1,008 | $ 760 | $ 1,008 | $ 0 |
Schedule II. Condensed Financ_5
Schedule II. Condensed Financial Information of Registrant (Notes To Condensed Financial Statements) (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Condensed Financial Statements, Captions [Line Items] | |||
Dividends from subsidiaries | $ 448,000 | $ 454,000 | $ 438,000 |
Stock-based compensation not involving cash | 39,792 | 37,034 | 26,326 |
Interest paid | 83,518 | 82,494 | 81,338 |
Income taxes paid (received) | $ 91,510 | $ 74,379 | 79,790 |
Preferred stock, shares outstanding | 0 | 0 | |
Parent Company | |||
Condensed Financial Statements, Captions [Line Items] | |||
Dividends from subsidiaries | $ 448,142 | $ 453,904 | 437,566 |
Stock-based compensation not involving cash | 39,792 | 37,034 | 26,326 |
Investment in subsidiaries | 11,889 | 317,027 | 0 |
Dividend of property to Parent | 11,889 | 0 | 0 |
Interest paid | 86,982 | 86,606 | 84,952 |
Income taxes paid (received) | $ (21,377) | $ (19,961) | $ (20,838) |
Preferred stock, liquidation distribution available to stockholders, per share in thousands | $ 1,000 | ||
Preferred stock, liquidating distribution legally available, aggregate value | $ 351,000 | ||
Cumulative Series A Preferred Stock | Parent Company | |||
Condensed Financial Statements, Captions [Line Items] | |||
Preferred stock, shares issued | 351,000 | ||
Preferred stock, shares outstanding | 351,000 | ||
6.50% Cumulative Preferred Stock, Series A | Parent Company | |||
Condensed Financial Statements, Captions [Line Items] | |||
Preferred stock, shares issued | 280,000 | ||
Preferred stock, shares outstanding | 280,000 | ||
Preferred stock, dividend rate, percentage | 6.50% | ||
7.15% Cumulative Preferred Stock, Series A | Parent Company | |||
Condensed Financial Statements, Captions [Line Items] | |||
Preferred stock, shares issued | 71,000 | ||
Preferred stock, shares outstanding | 71,000 | ||
Preferred stock, dividend rate, percentage | 7.15% |
Schedule I. Reinsurance (Detail
Schedule I. Reinsurance (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||
Life insurance in force, gross amount | $ 185,212,195 | $ 179,902,605 | $ 174,314,897 |
Life insurance in force, ceded to other companies | 688,384 | 705,152 | 725,867 |
Life insurance in force, assumed from other companies | 3,019,737 | 3,211,423 | 3,352,113 |
Life insurance in force, net amount | $ 187,543,548 | $ 182,408,876 | $ 176,941,143 |
Life insurance in force, percentage of amount assumed to net | 1.60% | 1.80% | 1.90% |
Premium, gross amount | $ 3,392,430 | $ 3,252,120 | $ 3,103,835 |
Premium, ceded to other companies | 8,249 | 8,146 | 7,981 |
Premium, assumed from other companies | 21,305 | 21,912 | 22,915 |
Premium, net amount | $ 3,405,486 | $ 3,265,886 | $ 3,118,769 |
Percentage of amount assumed to net | 0.60% | 0.70% | 0.70% |
Policy charges | $ 16,400 | $ 17,000 | $ 18,300 |
Life insurance | |||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||
Premium, gross amount | 2,373,423 | 2,272,038 | 2,152,698 |
Premium, ceded to other companies | 4,581 | 4,437 | 4,507 |
Premium, assumed from other companies | 21,305 | 21,912 | 22,915 |
Premium, net amount | $ 2,390,147 | $ 2,289,513 | $ 2,171,106 |
Percentage of amount assumed to net | 0.90% | 1.00% | 1.10% |
Health insurance | |||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | |||
Premium, gross amount | $ 1,019,007 | $ 980,082 | $ 951,137 |
Premium, ceded to other companies | 3,668 | 3,709 | 3,474 |
Premium, assumed from other companies | 0 | 0 | 0 |
Premium, net amount | $ 1,015,339 | $ 976,373 | $ 947,663 |
Percentage of amount assumed to net | 0.00% | 0.00% | 0.00% |
Uncategorized Items - tmk-20181
Label | Element | Value | [1] |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 4,896,000 | |
Retained Earnings [Member] | |||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 4,896,000 | |
[1] | In January 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, which primarily revises the classification and measurement of certain equity investments such that they will be measured at fair value through net income. Additionally, the guidance eliminates the cost method for certain partnerships and joint ventures and requires these types of investments to be accounted for under the fair value through net income or equity method. This standard became effective for the Company on January 1, 2018. See further discussion in Note 1—Significant Accounting Policies. |