Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2018shares | |
Entity Information [Line Items] | |
Entity Registrant Name | Old Republic International Corporation |
Entity Central Index Key | 74,260 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Document Type | 10-Q |
Document Period End Date | Mar. 31, 2018 |
Document Fiscal Year Focus | 2,018 |
Document Fiscal Period Focus | Q1 |
Amendment Flag | false |
Entity Common Stock, Shares Outstanding | 302,185,787 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 | |
Available for sale: | |||
Fixed maturity securities (at fair value) (amortized cost: $8,136.8 and $8,162.2) | $ 8,107.8 | $ 8,282.3 | |
Short-term investments (at fair value which approximates cost) | 474.9 | 670.1 | |
Miscellaneous investments | 30 | 29.1 | |
Total | 8,612.9 | 8,981.6 | |
Held to maturity | |||
Fixed maturity securities (at amortized cost) (fair value: $1,038.0 and $1,069.2) | 1,061.8 | 1,067.4 | |
Equity securities (at fair value) (cost: $2,666.1 and $2,629.9) | 3,149.7 | 3,265.5 | |
Other investments | 3.6 | 3.3 | |
Total investments | 12,828.2 | 13,318 | |
Other Assets: | |||
Cash | 103.4 | 125.9 | |
Securities and indebtedness of related parties | 22.4 | 12.8 | |
Accrued investment income | 94.3 | 92.4 | |
Accounts and notes receivable | 1,516.1 | 1,469.7 | |
Prepaid federal income taxes | 114.3 | 114.3 | |
Reinsurance balances and funds held | 148.8 | 141.6 | |
Reinsurance recoverable: Paid losses | 70.9 | 60.5 | |
Reinsurance recoverable: Policy and claim reserves | 3,330.9 | 3,311.3 | |
Deferred policy acquisition costs | 304.2 | 297.8 | |
Sundry assets | 464.7 | 458.8 | |
Total Other Assets | 6,170.6 | 6,085.5 | |
Total Assets | 18,998.8 | 19,403.5 | |
Liabilities, Preferred Stock, and Common Shareholders' Equity Liabilities: | |||
Losses, claims, and settlement expenses | 9,272.4 | 9,237.6 | |
Unearned premiums | 2,060.9 | 1,971.5 | |
Other policyholders' benefits and funds | 206.5 | 204.7 | |
Total policy liabilities and accruals | 11,540 | 11,413.9 | |
Commissions, expenses, fees, and taxes | 504.2 | 547.7 | |
Reinsurance balances and funds | 605 | 566.9 | |
Taxes Payable, Current | 27.2 | 6.5 | |
Deferred Income Tax Liabilities, Net | 33.4 | 100.5 | |
Debt | 974.1 | 1,448.7 | |
Sundry liabilities | 265.9 | 585.8 | |
Commitments and contingent liabilities | |||
Total Liabilities | 13,950.2 | 14,670.2 | |
Preferred Stock | [1] | 0 | 0 |
Common Shareholders' Equity: | |||
Common stock | [1] | 302.1 | 269.2 |
Additional paid-in capital | 1,267.9 | 815.2 | |
Retained earnings | 3,658.1 | 3,206.9 | |
Accumulated other comprehensive income (loss) | (148.9) | 474.2 | |
Unallocated ESSOP shares (at cost) | (30.6) | (32.4) | |
Total Common Shareholders' Equity | 5,048.6 | 4,733.3 | |
Total Liabilities, Preferred Stock and Common Shareholders' Equity | $ 18,998.8 | $ 19,403.5 | |
[1] | At March 31, 2018 and December 31, 2017, there were 75,000,000 shares of $0.01 par value preferred stock authorized, of which no shares were outstanding. As of the same dates, there were 500,000,000 shares of common stock, $1.00 par value, authorized, of which 302,185,787 and 269,238,727 were issued as of March 31, 2018 and December 31, 2017, respectively. At March 31, 2018 and December 31, 2017, there were 100,000,000 shares of Class B Common Stock, $1.00 par value, authorized, of which no shares were issued. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Available for sale: | ||
Fixed maturity securities (amortized costs) | $ 8,136.8 | $ 8,162.2 |
Held to maturity securities | ||
Fixed maturity securities (fair value) | 1,038 | 1,069.2 |
Equity securities - cost | $ 2,666.1 | $ 2,629.9 |
Preferred Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred Stock, authorized shares (in shares) | 75,000,000 | 75,000,000 |
Preferred Stock, outstanding shares (in shares) | 0 | 0 |
Common Stock, par value (in dollars per share) | $ 1 | $ 1 |
Common Stock, authorized shares (in shares) | 500,000,000 | 500,000,000 |
Common Stock, issued shares (in shares) | 302,185,787 | 262,719,660 |
Common Class B [Member] | ||
Held to maturity securities | ||
Common Stock, par value (in dollars per share) | $ 1 | $ 1 |
Common Stock, authorized shares (in shares) | 100,000,000 | 100,000,000 |
Common Stock, issued shares (in shares) | 0 | 0 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Revenues: | ||
Net premiums earned | $ 1,231 | $ 1,201.3 |
Title, escrow, and other fees | 99.3 | 99.7 |
Total premiums and fees | 1,330.4 | 1,301 |
Net investment income | 105.8 | 101.2 |
Other income | 30.6 | 27.6 |
Total operating revenues | 1,466.8 | 1,429.9 |
Investment gains (losses): | ||
Realized from actual transactions | 15.5 | 14.8 |
Unrealized from changes in fair value of equity securities | (152) | 0 |
Impairments | 0 | 0 |
Total realized and unrealized investment gains (losses) | (136.4) | 14.8 |
Total revenues | 1,330.4 | 1,444.8 |
Benefits, Claims and Expenses: | ||
Benefits, claims and settlement expenses | 590.1 | 559.2 |
Dividends to policyholders | 3.8 | 4.1 |
Underwriting, acquisition, and other expenses | 728 | 700.2 |
Interest and other charges | 14.4 | 16.4 |
Total expenses | 1,336.4 | 1,280.1 |
Income (loss) before income taxes (credits) | (6) | 164.7 |
Income Taxes (Credits): | ||
Current | 26 | 51.9 |
Deferred | (36.1) | (0.3) |
Total | (10.1) | 51.6 |
Net Income | $ 4 | $ 113.1 |
Net Income Per Share: | ||
Net income (loss) per share: Basic (in dollars per share) | $ 0.01 | $ 0.43 |
Net income (loss) per share: Diluted (in dollars per share) | $ 0.01 | $ 0.39 |
Average shares outstanding: Basic (in shares) | 278,116,902 | 260,784,905 |
Average shares outstanding: Diluted (in shares) | 279,528,034 | 298,239,349 |
Dividends Per Common Share: | ||
Cash | $ 0.1950 | $ 0.1900 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 4 | $ 113.1 |
Unrealized gains (losses) on securities: | ||
Unrealized gains (losses) on securities before reclassifications | (148.6) | 80 |
Amounts reclassified as realized investment gains from sales in the statements of income | (0.5) | (14.8) |
Pretax unrealized gains (losses) on securities | (149.2) | 65.2 |
Deferred income taxes (credits) | (31.3) | 22.7 |
Net unrealized gains (losses) on securities, net of tax | (117.8) | 42.5 |
Defined benefit pension plans: | ||
Net pension adjustment before reclassifications | 0 | 0 |
Amounts reclassified as underwriting, acquisition, and other expenses in the statements of income | 0.8 | 0.1 |
Net adjustment related to defined benefit pension plans | 0.8 | 0.1 |
Deferred income taxes (credits) | 0.1 | 0 |
Net adjustment related to defined benefit pension plans, net of tax | 0.6 | 0 |
Foreign currency translation and other adjustments | (3.7) | 1.5 |
Net adjustments | (120.9) | 44.1 |
Comprehensive Income (Loss) | $ (116.8) | $ 157.2 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Cash flows from operating activities: | ||
Net income | $ 4 | $ 113.1 |
Adjustments to reconcile net income to | ||
Deferred policy acquisition costs | (6.4) | (7.6) |
Premiums and other receivables | (46.4) | (70.8) |
Unpaid claims and related items | 65.1 | 24.4 |
Unearned premiums and other policyholders' liabilities | 41.1 | 50.5 |
Income taxes | (15) | 56.5 |
Prepaid federal income taxes | 0 | (31.8) |
Reinsurance balances and funds | 20.5 | 42.3 |
Realized investment (gains) losses from actual sale transactions | (15.5) | (14.8) |
Unrealized investment (gains) losses from changes in fair value of equity securities | 152 | 0 |
Accounts payable, accrued expenses and other | (68.7) | (15.6) |
Total | 130.8 | 146.1 |
Available for sale | ||
Maturities and early calls | 196.8 | 139.8 |
Sales | 144 | 107.9 |
Sales of: | ||
Equity securities | 81.2 | 40.3 |
Other - net | 4.7 | 6.8 |
Purchases of: | ||
Available for sale | (324.9) | (197.6) |
Held to maturity | 0 | (87.3) |
Equity securities | (103.1) | (95.9) |
Other - net | (13.5) | (13.6) |
Net decrease (increase) in short-term investments | 195.1 | 27.2 |
Other - net | (1.5) | 0 |
Total | 178.9 | (72.3) |
Cash flows from financing activities: | ||
Issuance of common shares | 6.2 | 11.1 |
Redemption of debentures and notes | (4.7) | (3.9) |
Dividends on common shares | (324.1) | (49.3) |
Other - net | (9.5) | 0 |
Total | (332.2) | (42.2) |
Increase (decrease) in cash | (22.5) | 31.5 |
Cash, beginning of period | 125.9 | 145.7 |
Cash, end of period | 103.4 | 177.2 |
Supplemental cash flow information: | ||
Cash paid (received) during the period for: Interest | 29.5 | 30.9 |
Cash paid (received) during the period for: Income taxes | $ 5.2 | $ (5) |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Accounting Policies and Basis of Presentation | Accounting Policies and Basis of Presentation: The accompanying consolidated financial statements have been prepared in conformity with the Financial Accounting Standards Board's ("FASB") Accounting Standards Codification ("ASC") of accounting principles generally accepted in the United States of America ("GAAP"). These interim financial statements should be read in conjunction with these notes and those included in the Company's 2017 Annual Report on Form 10-K incorporated herein by reference. Pertinent accounting and disclosure pronouncements issued from time to time by the FASB are adopted by the Company as they become effective and are further discussed below. Effective January 1, 2018, the Company adopted FASB guidance on the recognition and measurement of financial instruments. The impact of the Company’s adoption of this pronouncement and the related interim disclosure requirements have been included in the pertinent note herein. In addition, effective January 1, 2018, the Company adopted the FASB's comprehensive revenue recognition standard which applies to all entities that have contracts with customers, except for those that fall within the scope of other standards, such as insurance contracts. The Company’s adoption of this standard did not have an effect on its insurance contract revenues and based on its evaluation of certain less significant revenue streams generated from contracts with customers, does not have a material impact on the consolidated financial statements. The Company recognized total contract revenue from customers of $40.7 and $37.7 for the period ended March 31, 2018 and 2017 , respectively. Of these amounts, approximately $26.7 ( 65.6% ) and $24.2 ( 64.2% ) were generated from claims handling and related ancillary services (i.e. risk control services) provided to customers within the Company’s General Insurance segment. Claims handling revenues are recognized on a straight-line basis over the contract period (generally one year) which is commensurate with the entity’s efforts relative to claims adjudication. The related ancillary services revenues are recognized as services are provided and invoiced to the customer. Additionally, revenues from contracts with customers generated from the Company’s Title Insurance segment, consisting primarily of valuation and default title services, and software licensing arrangements totaled $12.9 ( 31.7% ) and $12.5 ( 33.2% ) for the period ended March 31, 2018 and 2017 , respectively. Such revenues are generally recognized at a point in time upon completion and invoicing of the services, or in the case of software maintenance agreements, on a straight-line basis over the life of the contract (generally one year). Furthermore, effective January 1, 2017, the Company adopted new FASB guidance on accounting for share-based payment award transactions. The Company’s adoption of this guidance did not have a material impact on the consolidated financial statements. In February 2016, the FASB issued guidance on lease accounting which will be effective in 2019 and requires balance sheet recognition of all leases with a term greater than 12 months. In June 2016, the FASB issued guidance on accounting for credit losses on financial instruments which will be effective in 2020. The guidance will require immediate recognition of expected credit losses for certain financial instruments including reinsurance recoverables, held to maturity securities, and accounts and notes receivable. The guidance also modifies the impairment model for available for sale fixed maturities securities. The Company is currently evaluating the foregoing lease and credit loss guidance to determine the potential impact of its adoption on its consolidated financial statements. The financial accounting and reporting process relies on estimates and on the exercise of judgment. In the opinion of management all adjustments consisting only of normal recurring accruals necessary for a fair presentation of the results have been recorded for the interim periods. Amounts shown in the consolidated financial statements and applicable notes are stated (except as otherwise indicated and as to share data) in millions, which amounts may not add to totals shown due to truncation. Necessary reclassifications are made in prior periods' financial statements whenever appropriate to conform to the most current presentation. |
Common Share Data
Common Share Data | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Common Share Data | Common Share Data: Earnings Per Share - Consolidated basic earnings per share excludes the dilutive effect of common stock equivalents and is computed by dividing income available to common stockholders by the weighted-average number of common shares actually outstanding for the quarterly and year-to-date periods. Diluted earnings per share are similarly calculated with the inclusion of dilutive common stock equivalents. The following table provides a reconciliation of net income and the number of shares used in basic and diluted earnings per share calculations. Quarters Ended March 31, 2018 2017 Numerator: Net income $ 4.0 $ 113.1 Numerator for basic earnings per share - income available to common stockholders 4.0 113.1 Adjustment for interest expense incurred on assumed conversion of convertible notes — 3.6 Numerator for diluted earnings per share - income available to common stockholders after assumed conversion of convertible notes $ 4.0 $ 116.7 Denominator: Denominator for basic earnings per share - weighted-average shares (a) 278,116,902 260,784,905 Effect of dilutive securities - stock based compensation awards 1,411,132 1,703,231 Effect of dilutive securities - convertible senior notes — 35,751,213 Denominator for diluted earnings per share - adjusted weighted-average shares and assumed conversion of convertible notes (a) 279,528,034 298,239,349 Earnings per share: Basic $ .01 $ .43 Diluted $ .01 $ .39 Anti-dilutive common stock equivalents excluded from earnings per share computations: Stock based compensation awards 1,539,500 — Convertible senior notes 21,773,776 — Total 23,313,276 — __________ (a) In calculating earnings per share, pertinent accounting rules require that common shares owned by the Company's Employee Savings and Stock Ownership Plan that are not yet allocated to participants in the plan be excluded from the calculation. Such shares are issued and outstanding and have the same voting and other rights applicable to all other common shares. |
Investments
Investments | 3 Months Ended |
Mar. 31, 2018 | |
Investments [Abstract] | |
Investments | Investments: The Company may classify its fixed maturity invested assets in terms of those assets relative to which it either (1) has the positive intent and ability to hold until maturity, (2) has available for sale or (3) has the intention of trading. As of March 31, 2018 and December 31, 2017 , the majority of the Company's fixed maturity invested assets were classified as "available for sale." Fixed maturity securities classified as "available for sale" are included at fair value with changes in such values, net of deferred income taxes, reflected directly in shareholders' equity while fixed maturity securities classified as "held to maturity" are carried at amortized cost. Effective January 1, 2018, preferred and common stocks (equity securities) are included at fair value with changes in such values reflected as investment gains (losses) in the consolidated statements of income. Fair values for fixed maturity securities and equity securities are based on quoted market prices or estimates using values obtained from independent pricing services as applicable. The Company reviews the status and fair value changes of each of its fixed maturity investments on at least a quarterly basis during the year, and estimates of other-than-temporary impairments ("OTTI") in the portfolio's value are evaluated and established at each quarterly balance sheet date. In reviewing investments for OTTI, the Company, in addition to a security's market price history, considers the totality of such factors as the issuer's operating results, financial condition and liquidity, its ability to access capital markets, credit rating trends, most current audit opinion, industry and securities markets conditions, and analyst expectations to reach its conclusions. Sudden fair value declines caused by such adverse developments as newly emerged or imminent bankruptcy filings, issuer default on significant obligations, or reports of financial accounting developments that bring into question the validity of the issuer's previously reported earnings or financial condition, are recognized as realized losses as soon as credible publicly available information emerges to confirm such developments. In the event the Company's estimate of OTTI is insufficient at any point in time, future periods' net income (loss) would be adversely affected by the recognition of additional impairment losses, but its financial position would not necessarily be affected adversely inasmuch as such losses, or a portion of them, could have been recognized previously as unrealized losses in shareholders' equity. The Company recognized no OTTI adjustments for the quarters ended March 31, 2018 and 2017 . The amortized cost and estimated fair values by type and contractual maturity of fixed maturity securities are shown in the following tables. Expected maturities will differ from contractual maturities since borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Fixed Maturity Securities by Type: March 31, 2018: Available for sale: U.S. & Canadian Governments $ 1,455.2 $ 2.8 $ 22.4 $ 1,435.6 Corporate 6,681.6 66.7 76.1 6,672.1 $ 8,136.8 $ 69.6 $ 98.6 $ 8,107.8 Held to maturity: Tax-exempt $ 1,061.8 $ .8 $ 24.6 $ 1,038.0 December 31, 2017: Available for sale: U.S. & Canadian Governments $ 1,554.3 $ 6.5 $ 8.7 $ 1,552.2 Corporate 6,607.8 140.8 18.6 6,730.0 $ 8,162.2 $ 147.4 $ 27.3 $ 8,282.3 Held to maturity: Tax-exempt $ 1,067.4 $ 10.0 $ 8.3 $ 1,069.2 Amortized Cost Estimated Fair Value Fixed Maturity Securities Stratified by Contractual Maturity at March 31, 2018: Available for sale: Due in one year or less $ 737.6 $ 741.1 Due after one year through five years 4,296.1 4,295.3 Due after five years through ten years 3,000.9 2,963.8 Due after ten years 102.0 107.5 $ 8,136.8 $ 8,107.8 Held to maturity: Due in one year or less $ — $ — Due after one year through five years 93.1 91.1 Due after five years through ten years 960.5 938.7 Due after ten years 8.1 8.1 $ 1,061.8 $ 1,038.0 The following table reflects the Company's gross unrealized losses and fair value, aggregated by category and length of time that individual available for sale and held to maturity securities have been in an unrealized loss position. Fair value and issuer's cost comparisons follow: 12 Months or Less Greater than 12 Months Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses March 31, 2018: Fixed Maturity Securities: U.S. & Canadian Governments $ 761.3 $ 13.4 $ 382.8 $ 8.9 $ 1,144.1 $ 22.4 Tax-exempt 507.8 7.1 404.3 17.4 912.2 24.6 Corporate 2,992.9 53.5 664.0 22.6 3,657.0 76.1 Total $ 4,262.2 $ 74.1 $ 1,451.2 $ 49.1 $ 5,713.5 $ 123.2 December 31, 2017: Fixed Maturity Securities: U.S. & Canadian Governments $ 1,080.9 $ 8.6 $ 29.5 $ — $ 1,110.5 $ 8.7 Tax-exempt 321.9 4.8 134.7 3.4 456.6 8.3 Corporate 1,660.9 15.0 145.9 3.6 1,806.9 18.6 Subtotal 3,063.9 28.5 310.2 7.2 3,374.1 35.7 Equity Securities 354.0 23.2 — — 354.0 23.2 Total $ 3,417.9 $ 51.7 $ 310.2 $ 7.2 $ 3,728.2 $ 58.9 At March 31, 2018 , the Company held 1,296 fixed maturity securities in an unrealized loss position, representing 65.9% of the total number of such issues it held. At December 31, 2017 , the Company held 742 fixed maturity and 9 equity securities in an unrealized loss position, representing 37.6% (as to fixed maturities) and 9.5% (as to equity securities) of the total number of such issues it held. Of the securities in an unrealized loss position, 353 and 104 fixed maturity securities had been in a continuous unrealized loss position for more than 12 months as of March 31, 2018 and December 31, 2017 , respectively. The unrealized losses on these fixed income securities are primarily deemed to reflect changes in the interest rate environment. As part of its assessment of other-than-temporary impairments, the Company considers its intent to continue to hold, and the likelihood that it will not be required to sell investment securities in an unrealized loss position until cost recovery, principally on the basis of its asset and liability maturity matching procedures. A summary of the Company's equity securities follows: Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Equity Securities: March 31, 2018 $ 2,666.1 $ 526.6 $ 42.9 $ 3,149.7 December 31, 2017 $ 2,629.9 $ 658.8 $ 23.2 $ 3,265.5 Effective January 1, 2018, the Company adopted a new accounting standard which requires the recognition of changes in fair value of equity securities in net income. The cumulative-effect adjustment resulting from the adoption of the new standard was to reclassify $502.1 from accumulated other comprehensive income to retained earnings; total shareholders' equity remained unchanged. During the first quarter 2018 , the Company recognized unrealized investment losses of $152.0 emanating from changes in the fair value of equity securities in the consolidated statements of income. Of this amount, $131.3 was related to changes in the fair value of equity securities still held at March 31, 2018 . Fair Value Measurements - Fair value is defined as the estimated price that is likely to be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants (an exit price) at the measurement date. A fair value hierarchy is established that prioritizes the sources ("inputs") used to measure fair value into three broad levels: inputs based on quoted market prices in active markets (Level 1); observable inputs based on corroboration with available market data (Level 2); and unobservable inputs based on uncorroborated market data or a reporting entity's own assumptions (Level 3). Following is a description of the valuation methodologies and general classification used for financial instruments measured at fair value. The Company uses quoted values and other data provided by a nationally recognized independent pricing source as inputs into its quarterly process for determining fair values of its fixed maturity and equity securities. To validate the techniques or models used by pricing sources, the Company's review process includes, but is not limited to: (i) initial and ongoing evaluation of methodologies used by outside parties to calculate fair value; and (ii) comparing other sources including the fair value estimates to its knowledge of the current market and to independent fair value estimates provided by the investment custodian. The independent pricing source obtains market quotations and actual transaction prices for securities that have quoted prices in active markets and uses its own proprietary method for determining the fair value of securities that are not actively traded. In general, these methods involve the use of "matrix pricing" in which the independent pricing source uses observable market inputs including, but not limited to, investment yields, credit risks and spreads, benchmarking of like securities, broker-dealer quotes, reported trades and sector groupings to determine a reasonable fair value. Level 1 securities include U.S. and Canadian Treasury notes, publicly traded common stocks, the quoted net asset value ("NAV") mutual funds, and most short-term investments in highly liquid money market instruments. Level 2 securities generally include corporate bonds, municipal bonds, and certain U.S. and Canadian government agency securities. Securities classified within Level 3 include non-publicly traded bonds and equity securities. There were no significant changes in the fair value of assets measured with the use of significant unobservable inputs as of March 31, 2018 and December 31, 2017 . The following tables show a summary of the fair value of financial assets segregated among the various input levels described above: Fair Value Measurements As of March 31, 2018: Level 1 Level 2 Level 3 Total Available for sale: Fixed maturity securities: U.S. & Canadian Governments $ 645.7 $ 789.9 $ — $ 1,435.6 Corporate — 6,661.6 10.5 6,672.1 Short-term investments 474.9 — — 474.9 Held to maturity: Fixed maturity securities: Tax-exempt — 1,038.0 — 1,038.0 Equity securities $ 3,148.6 $ — $ 1.1 $ 3,149.7 As of December 31, 2017: Available for sale: Fixed maturity securities: U.S. & Canadian Governments $ 761.4 $ 790.8 $ — $ 1,552.2 Corporate — 6,719.5 10.5 6,730.0 Short-term investments 670.1 — — 670.1 Held to maturity: Fixed maturity securities: Tax-exempt — 1,069.2 — 1,069.2 Equity securities $ 3,264.4 $ — $ 1.1 $ 3,265.5 There were no transfers between Levels 1, 2 or 3 during the quarter ended March 31, 2018 . Investment income is reported net of allocated expenses and includes appropriate adjustments for amortization of premium and accretion of discount on fixed maturity securities acquired at other than par value. Dividends on equity securities are credited to income on the ex-dividend date. Realized investment gains and losses, which result from sales or write-downs of securities are reflected as revenues in the income statement and are determined on the basis of amortized value at date of sale for fixed maturity securities, and cost in regard to equity securities; such bases apply to the specific securities sold. Also, effective January 1, 2018 , unrealized gains and (losses) from changes in fair value of equity securities are recorded as investment gains (losses) in the income statement. Unrealized investment gains and losses on fixed maturity securities, net of any deferred income taxes, are recorded directly as a component of accumulated other comprehensive income in shareholders' equity. At March 31, 2018 , the Company and its subsidiaries had no non-income producing fixed maturity securities. The following table reflects the composition of net investment income, net realized gains or losses, and the net change in unrealized investment gains or losses for each of the periods shown. Quarters Ended March 31, 2018 2017 Investment income from: Fixed maturity securities $ 74.2 $ 74.2 Equity securities 30.4 26.1 Short-term investments 1.9 .8 Other sources .9 1.2 Gross investment income 107.5 102.4 Investment expenses (a) 1.7 1.1 Net investment income $ 105.8 $ 101.2 Investment gains (losses): From actual sale transactions: Fixed maturity securities: Gains $ .4 $ 2.8 Losses (.1 ) (.1 ) Net .2 2.6 Equity securities: Gains 14.9 12.1 Losses — — Net 14.9 12.1 Other long-term investments, net .2 — Total from actual sale transactions 15.5 14.8 From unrealized changes in fair value of equity securities (152.0 ) — From impairments — — Total investment gains (losses) (136.4 ) 14.8 Income taxes (credits) (28.7 ) 5.1 Net investment gains (losses) $ (107.7 ) $ 9.6 Changes in unrealized investment gains (losses) on: Fixed maturity securities $ (148.7 ) $ 17.0 Less: Deferred income taxes (credits) (31.3 ) 5.9 (117.4 ) 11.1 Equity securities & other long-term investments (.4 ) 48.1 Less: Deferred income taxes (credits) — 16.7 (.3 ) 31.3 Net changes in unrealized investment gains (losses) $ (117.8 ) $ 42.5 __________ (a) Investment expenses consist of personnel costs and investment management and custody service fees, as well as interest incurred on funds held of $.1 for both the quarters ended March 31, 2018 and 2017 . |
Losses, Claims and Settlement E
Losses, Claims and Settlement Expenses | 3 Months Ended |
Mar. 31, 2018 | |
Insurance [Abstract] | |
Losses, Claims and Settlement Expenses | Losses, Claims and Settlement Expenses: The establishment of claim reserves by the Company's insurance subsidiaries is a reasonably complex and dynamic process influenced by a large variety of factors. These factors principally include past experience applicable to the anticipated costs of various types of claims, continually evolving and changing legal theories emanating from the judicial system, recurring accounting, statistical, and actuarial studies, the professional experience and expertise of the Company's claim departments' personnel or attorneys and independent claim adjusters, ongoing changes in claim frequency or severity patterns such as those caused by natural disasters, illnesses, accidents, work‑related injuries, and changes in general and industry-specific economic conditions. Consequently, the reserves established are a reflection of the opinions of a large number of persons, of the application and interpretation of historical precedent and trends, of expectations as to future developments, and of management's judgment in interpreting all such factors. At any point in time, the Company is exposed to the incurrence of possibly higher or lower than anticipated claim costs due to all of these factors, and to the evolution, interpretation, and expansion of tort law, as well as the effects of unexpected jury verdicts. All reserves are therefore based on estimates which are periodically reviewed and evaluated in the light of emerging claim experience and changing circumstances. The resulting changes in estimates are recorded in operations of the periods during which they are made. Return and additional premiums and policyholders' dividends, all of which tend to be affected by development of claims in future years, may offset, in whole or in part, favorable or unfavorable claim developments for certain coverages such as workers' compensation, portions of which are written under loss sensitive programs that provide for such adjustments. The Company believes that its overall reserving practices have been consistently applied over many years, and that its aggregate net reserves have generally resulted in reasonable approximations of the ultimate net costs of claims incurred. However, no representation is made nor is any guaranty given that ultimate net claim and related costs will not develop in future years to be greater or lower than currently established reserve estimates. The Company’s accounting policy regarding the establishment of claim reserve estimates is described in Note 1(h) to the consolidated financial statements included in Old Republic’s 2017 Annual Report on Form 10-K. The following table shows an analysis of changes in aggregate reserves for the Company's losses, claims and settlement expenses for each of the periods shown. Quarters Ended March 31, 2018 2017 Gross reserves at beginning of period $ 9,237.6 $ 9,206.0 Less: reinsurance losses recoverable 2,921.1 2,766.1 Net reserves at beginning of period: General Insurance 5,471.5 5,249.9 Title Insurance 559.7 602.0 RFIG Run-off 271.7 574.0 Other 13.5 13.8 Sub-total 6,316.4 6,439.8 Incurred claims and claim adjustment expenses: Provisions for insured events of the current year: General Insurance 546.3 513.3 Title Insurance 21.1 21.3 RFIG Run-off (a) 18.7 32.8 Other 5.7 7.0 Sub-total 591.9 574.6 Change in provision for insured events of prior years: General Insurance 15.9 10.1 Title Insurance (8.2 ) (10.3 ) RFIG Run-off (a) (7.2 ) (13.0 ) Other (2.3 ) (1.8 ) Sub-total (1.8 ) (15.1 ) Total incurred claims and claim adjustment expenses (a) 590.1 559.5 Payments: Claims and claim adjustment expenses attributable to insured events of the current year: General Insurance 104.2 94.1 Title Insurance .1 .2 RFIG Run-off (a)(b) — .2 Other 2.2 2.5 Sub-total 106.7 97.1 Claims and claim adjustment expenses attributable to insured events of prior years: General Insurance 368.0 367.5 Title Insurance 13.6 14.7 RFIG Run-off (b) 34.0 53.4 Other 2.4 2.2 Sub-total 418.1 437.8 Total payments (b) 524.8 535.0 Amount of reserves for unpaid claims and claim adjustment expenses at the end of each period, net of reinsurance losses recoverable: (c) General Insurance 5,561.5 5,311.7 Title Insurance 558.7 598.1 RFIG Run-off 249.1 540.2 Other 12.2 14.2 Sub-total 6,381.7 6,464.3 Reinsurance losses recoverable 2,890.7 2,766.9 Gross reserves at end of period $ 9,272.4 $ 9,231.3 __________ (a) In common with all other insurance coverages, RFIG Run-off mortgage guaranty settled and incurred claim and claim adjustment expenses include only those costs actually or expected to be paid by the Company. Changes in mortgage guaranty aggregate case, IBNR, and loss adjustment expense reserves shown below and entering into the determination of incurred claim costs, take into account, among a large number of variables, claim cost reductions for anticipated coverage rescissions and claims denials. The RFIG Run-off mortgage guaranty provision for insured events of the current year was reduced by estimated coverage rescissions and claims denials of $1.2 and $1.7 for the year-to-date periods ended March 31, 2018 and 2017 , respectively. The provision for insured events of prior years for the periods shown in the table was (increased) reduced by estimated coverage rescissions and claims denials of $(2.1) and $(1.6) , respectively. Prior year development was also affected in varying degrees by differences between actual claim settlements relative to expected experience, by reinstatement of previously rescinded or denied claims, and by subsequent revisions of assumptions in regards to claim frequency, severity or levels of associated claim settlement costs which result from consideration of underlying trends and expectations. (b) Rescissions reduced the Company's paid losses by an estimated $1.4 and $3.0 for the year-to-date periods ended March 31, 2018 and 2017 , respectively. (c) Net reserves for claims that have been incurred but are not yet reported ("IBNR") carried in each segment were as follows: March 31, March 31, December 31, 2018 2017 2017 General Insurance $ 2,686.9 $ 2,515.3 $ 2,585.9 Title Insurance 478.0 521.5 479.3 RFIG Run-off 30.0 208.6 30.5 Other 4.7 5.0 4.7 Total $ 3,199.8 $ 3,250.6 $ 3,100.6 |
Employee Benefit Plans
Employee Benefit Plans | 3 Months Ended |
Mar. 31, 2018 | |
Retirement Benefits [Abstract] | |
Pension Plans | Employee Benefit Plans: The Company had an active pension plan (the "Plan") covering a portion of its work force until December 31, 2013 . The Plan is a defined benefit plan pursuant to which pension payments are based primarily on years of service and employee compensation near retirement. The Plan was closed to new participants and benefits were frozen as of December 31, 2013 . As a result, eligible employees retained all of the vested rights as of the effective date of the freeze. While additional benefits no longer accrue, the Company's cumulative obligation continues to be subject to further adjustment due to changes in actuarial assumptions such as expected mortality and changes in interest rates. Net periodic pension costs for the quarterly periods ended March 31, 2018 and 2017 were not material to Old Republic's consolidated statements of income. |
Information About Segments of B
Information About Segments of Business | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Information About Segments of Business | Information About Segments of Business: Old Republic is engaged in the single business of insurance underwriting and related services. The Company conducts its operations through a number of regulated insurance company subsidiaries organized into three major segments, namely its General Insurance Group (property and liability insurance), Title Insurance Group, and the Republic Financial Indemnity Group ("RFIG") Run-off Business. The results of a small life & accident insurance business are included with those of its holding company parent and minor corporate services operations. Each of the Company's segments underwrites and services only those insurance coverages which may be written by it pursuant to state insurance regulations and corporate charter provisions. Segment results exclude investment gains or losses and other-than-temporary impairments as these are aggregated in the consolidated totals. The contributions of Old Republic's insurance industry segments to consolidated totals are shown in the following table. Quarters Ended March 31, 2018 2017 General Insurance: Net premiums earned $ 791.2 $ 742.8 Net investment income and other income 113.5 106.2 Total revenues before investment gains or losses $ 904.8 $ 849.0 Income before income taxes (credits) and investment gains or losses (a) $ 83.3 $ 93.7 Income tax expense (credits) on above $ 11.5 $ 28.0 Title Insurance: Net premiums earned $ 414.5 $ 418.3 Title, escrow and other fees 99.3 99.7 Sub-total 513.8 518.0 Net investment income and other income 9.7 9.7 Total revenues before investment gains or losses $ 523.6 $ 527.8 Income before income taxes (credits) and investment gains or losses (a) $ 29.5 $ 40.4 Income tax expense (credits) on above $ 6.3 $ 13.8 RFIG Run-off Business: Net premiums earned $ 21.3 $ 35.5 Net investment income and other income 5.3 5.5 Total revenues before investment gains or losses $ 26.7 $ 41.1 Income before income taxes (credits) and investment gains or losses $ 10.9 $ 14.5 Income tax expense (credits) on above $ 2.2 $ 5.2 Consolidated Revenues: Total revenues of above Company segments $ 1,455.2 $ 1,418.0 Other sources (b) 41.4 41.9 Consolidated investment gains (losses): Realized from actual transactions 15.5 14.8 Unrealized from changes in fair value of equity securities (152.0 ) — Total realized and unrealized investment gains (losses) (136.4 ) 14.8 Consolidation elimination adjustments (29.7 ) (29.9 ) Consolidated revenues $ 1,330.4 $ 1,444.8 Consolidated Income (Loss) Before Income Taxes (Credits): Total income before income taxes (credits) and investment gains or losses of above Company segments $ 123.8 $ 148.7 Other sources - net (b) 6.5 1.1 Consolidated investment gains (losses): Realized from actual transactions 15.5 14.8 Unrealized from changes in fair value of equity securities (152.0 ) — Total realized and unrealized investment gains (losses) (136.4 ) 14.8 Consolidated income (loss) before income taxes (credits) $ (6.0 ) $ 164.7 Consolidated Income Tax Expense (Credits): Total income tax expense (credits) for above Company segments $ 20.1 $ 47.1 Other sources - net (b) (1.5 ) (.7 ) Income tax expense (credits) on consolidated investment gains (losses) (28.7 ) 5.1 Consolidated income tax expense (credits) $ (10.1 ) $ 51.6 March 31, December 31, 2018 2017 Consolidated Assets: General Insurance $ 16,015.8 $ 16,055.5 Title Insurance 1,401.5 1,466.0 RFIG Run-off Business 777.3 805.0 Total assets for the above company segments 18,194.8 18,326.6 Other assets (b) 1,109.9 1,440.9 Consolidation elimination adjustments (305.9 ) (364.0 ) Consolidated assets $ 18,998.8 $ 19,403.5 __________ (a) Income before income taxes (credits) is reported net of interest charges on intercompany financing arrangements with Old Republic's holding company parent for the following segments: General - $15.4 and $14.1 for the quarters ended March 31, 2018 and 2017 , respectively, and Title - $1.4 and $2.1 for the quarters ended March 31, 2018 and 2017 , respectively. (b) Represents amounts for Old Republic's holding company parent, minor corporate services subsidiaries, and a small life and accident insurance operation. |
Commitments and Contingent Liab
Commitments and Contingent Liabilities Commitments and Contingent Liabilities | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingent Liabilities | Commitments and Contingent Liabilities: Legal proceedings against the Company and its subsidiaries routinely arise in the normal course of business and usually pertain to claim matters related to insurance policies and contracts issued by its insurance subsidiaries. Under GAAP, an estimated loss is accrued only if the loss is probable and reasonably estimable. At March 31, 2018 , the Company did not have material non-claim litigation exposures in its consolidated business for which adequate claim and related expense provisions had not been made. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Debt | Debt: Consolidated debt of Old Republic and its subsidiaries is summarized below: March 31, 2018 December 31, 2017 Carrying Amount Fair Value Carrying Amount Fair Value 3.75% Convertible Senior Notes due 2018 $ — $ — $ 470.6 $ 652.2 4.875% Senior Notes due 2024 396.3 422.5 396.2 430.3 3.875% Senior Notes due 2026 545.3 541.4 545.1 553.9 ESSOP debt — — 4.2 4.2 Other miscellaneous debt with an average yield of 2.97% and 2.45%, respectively 32.4 32.5 32.4 32.5 Total debt $ 974.1 $ 996.5 $ 1,448.7 $ 1,673.2 During the first quarter 2018 , the Company's outstanding aggregate principal amount of the 3.75% Convertible Senior Notes were converted into 32,229,787 shares of Old Republic common stock. On August 26, 2016 , the Company completed a public offering of $550.0 aggregate principal amount of Senior Notes. The notes bear interest at a rate of 3.875% per year and mature on August 26, 2026 . On September 23, 2014 , the Company completed a public offering of $400.0 aggregate principal amount of Senior Notes. The notes bear interest at a rate of 4.875% per year and mature on October 1, 2024 . Fair Value Measurements - The Company utilizes indicative market prices, which incorporate recent actual market transactions and current bid/ask quotations to estimate the fair value of outstanding debt securities that are classified within Level 2 of the fair value hierarchy as presented below. The Company uses an internally generated interest yield market matrix table, which incorporates maturity, coupon rate, credit quality, structure and current market conditions to estimate the fair value of its outstanding debt securities that are classified within Level 3. The following table shows a summary of the carrying value and fair value of financial liabilities segregated among the various input levels described in Note 3 above: Carrying Fair Value Value Level 1 Level 2 Level 3 Financial Liabilities: Debt: March 31, 2018 $ 974.1 $ 996.5 $ — $ 964.0 $ 32.5 December 31, 2017 $ 1,448.7 $ 1,673.2 $ — $ 1,636.5 $ 36.7 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes: Tax positions taken or expected to be taken in a tax return by the Company are recognized in the financial statements when it is more likely than not that the position would be sustained upon examination by tax authorities. To the best of management's knowledge, there are no tax uncertainties that are expected to result in significant increases or decreases to unrecognized tax benefits within the next twelve month period. The Company views its income tax exposures as primarily consisting of timing differences whereby the ultimate deductibility of a taxable amount is highly certain but the timing of its deductibility is uncertain. Such differences relate principally to the timing of deductions for loss and premium reserves. As in prior examinations, the Internal Revenue Service ("IRS") could assert that claim reserve deductions were overstated thereby reducing the Company's statutory taxable income in any particular year. The Company believes that it establishes its reserves fairly and consistently at each balance sheet date, and that it would succeed in defending its tax position in these regards. Because of the impact of deferred tax accounting, the possible accelerated payment of tax to the IRS would not necessarily affect the annual effective tax rate. The Company classifies interest and penalties as income tax expense in the consolidated statement of income. The IRS has audited the Company's consolidated Federal income tax returns through year-end 2013. The Tax Cuts and Jobs Act ("TCJA") was enacted into law on December 22, 2017. The TCJA, among its many elements, lowered the nominal federal corporate tax rate to 21.0% from 35.0% . The Internal Revenue Service ("IRS") requires the Company's insurance subsidiaries to discount loss reserves using either company specific payment patterns, or industry average tables published by the IRS. The Company has previously elected to follow the IRS industry average tables. The TCJA requires the IRS to publish tables linking the interest rates used to discount loss reserves to the corporate bond yield curve as opposed to the Federal mid-term rates used under the old law. As of the date of this report, the IRS has not published the updated tables. Accordingly, the Company is unable to make a reasonable estimate of any adjustment resulting from the application of the new IRS published discount rates. The Company has used the most recently published IRS tables for the preparation of the accompanying consolidated financial statements. Any adjustment to the loss reserve discount will be recorded in the period in which additional information becomes available. |
Common Share Data (Tables)
Common Share Data (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Numerator and Denominator in Earnings Per Share | The following table provides a reconciliation of net income and the number of shares used in basic and diluted earnings per share calculations. Quarters Ended March 31, 2018 2017 Numerator: Net income $ 4.0 $ 113.1 Numerator for basic earnings per share - income available to common stockholders 4.0 113.1 Adjustment for interest expense incurred on assumed conversion of convertible notes — 3.6 Numerator for diluted earnings per share - income available to common stockholders after assumed conversion of convertible notes $ 4.0 $ 116.7 Denominator: Denominator for basic earnings per share - weighted-average shares (a) 278,116,902 260,784,905 Effect of dilutive securities - stock based compensation awards 1,411,132 1,703,231 Effect of dilutive securities - convertible senior notes — 35,751,213 Denominator for diluted earnings per share - adjusted weighted-average shares and assumed conversion of convertible notes (a) 279,528,034 298,239,349 Earnings per share: Basic $ .01 $ .43 Diluted $ .01 $ .39 Anti-dilutive common stock equivalents excluded from earnings per share computations: Stock based compensation awards 1,539,500 — Convertible senior notes 21,773,776 — Total 23,313,276 — __________ (a) In calculating earnings per share, pertinent accounting rules require that common shares owned by the Company's Employee Savings and Stock Ownership Plan that are not yet allocated to participants in the plan be excluded from the calculation. Such shares are issued and outstanding and have the same voting and other rights applicable to all other common shares. |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Investments [Abstract] | |
Amortized Cost and Estimated Fair Values Of Fixed Maturities | The amortized cost and estimated fair values by type and contractual maturity of fixed maturity securities are shown in the following tables. Expected maturities will differ from contractual maturities since borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Fixed Maturity Securities by Type: March 31, 2018: Available for sale: U.S. & Canadian Governments $ 1,455.2 $ 2.8 $ 22.4 $ 1,435.6 Corporate 6,681.6 66.7 76.1 6,672.1 $ 8,136.8 $ 69.6 $ 98.6 $ 8,107.8 Held to maturity: Tax-exempt $ 1,061.8 $ .8 $ 24.6 $ 1,038.0 December 31, 2017: Available for sale: U.S. & Canadian Governments $ 1,554.3 $ 6.5 $ 8.7 $ 1,552.2 Corporate 6,607.8 140.8 18.6 6,730.0 $ 8,162.2 $ 147.4 $ 27.3 $ 8,282.3 Held to maturity: Tax-exempt $ 1,067.4 $ 10.0 $ 8.3 $ 1,069.2 |
Amortized Cost and Estimated Fair Values Of Fixed Maturities By Contractual Maturities | Amortized Cost Estimated Fair Value Fixed Maturity Securities Stratified by Contractual Maturity at March 31, 2018: Available for sale: Due in one year or less $ 737.6 $ 741.1 Due after one year through five years 4,296.1 4,295.3 Due after five years through ten years 3,000.9 2,963.8 Due after ten years 102.0 107.5 $ 8,136.8 $ 8,107.8 Held to maturity: Due in one year or less $ — $ — Due after one year through five years 93.1 91.1 Due after five years through ten years 960.5 938.7 Due after ten years 8.1 8.1 $ 1,061.8 $ 1,038.0 |
Gross Unrealized Losses and Fair Value, Aggregated | The following table reflects the Company's gross unrealized losses and fair value, aggregated by category and length of time that individual available for sale and held to maturity securities have been in an unrealized loss position. Fair value and issuer's cost comparisons follow: 12 Months or Less Greater than 12 Months Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses March 31, 2018: Fixed Maturity Securities: U.S. & Canadian Governments $ 761.3 $ 13.4 $ 382.8 $ 8.9 $ 1,144.1 $ 22.4 Tax-exempt 507.8 7.1 404.3 17.4 912.2 24.6 Corporate 2,992.9 53.5 664.0 22.6 3,657.0 76.1 Total $ 4,262.2 $ 74.1 $ 1,451.2 $ 49.1 $ 5,713.5 $ 123.2 December 31, 2017: Fixed Maturity Securities: U.S. & Canadian Governments $ 1,080.9 $ 8.6 $ 29.5 $ — $ 1,110.5 $ 8.7 Tax-exempt 321.9 4.8 134.7 3.4 456.6 8.3 Corporate 1,660.9 15.0 145.9 3.6 1,806.9 18.6 Subtotal 3,063.9 28.5 310.2 7.2 3,374.1 35.7 Equity Securities 354.0 23.2 — — 354.0 23.2 Total $ 3,417.9 $ 51.7 $ 310.2 $ 7.2 $ 3,728.2 $ 58.9 |
Equity Securities Reflecting Reported Cost | Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Equity Securities: March 31, 2018 $ 2,666.1 $ 526.6 $ 42.9 $ 3,149.7 December 31, 2017 $ 2,629.9 $ 658.8 $ 23.2 $ 3,265.5 |
Fair Value, Assets Measured on Recurring Basis | The following tables show a summary of the fair value of financial assets segregated among the various input levels described above: Fair Value Measurements As of March 31, 2018: Level 1 Level 2 Level 3 Total Available for sale: Fixed maturity securities: U.S. & Canadian Governments $ 645.7 $ 789.9 $ — $ 1,435.6 Corporate — 6,661.6 10.5 6,672.1 Short-term investments 474.9 — — 474.9 Held to maturity: Fixed maturity securities: Tax-exempt — 1,038.0 — 1,038.0 Equity securities $ 3,148.6 $ — $ 1.1 $ 3,149.7 As of December 31, 2017: Available for sale: Fixed maturity securities: U.S. & Canadian Governments $ 761.4 $ 790.8 $ — $ 1,552.2 Corporate — 6,719.5 10.5 6,730.0 Short-term investments 670.1 — — 670.1 Held to maturity: Fixed maturity securities: Tax-exempt — 1,069.2 — 1,069.2 Equity securities $ 3,264.4 $ — $ 1.1 $ 3,265.5 |
Investment Income | The following table reflects the composition of net investment income, net realized gains or losses, and the net change in unrealized investment gains or losses for each of the periods shown. Quarters Ended March 31, 2018 2017 Investment income from: Fixed maturity securities $ 74.2 $ 74.2 Equity securities 30.4 26.1 Short-term investments 1.9 .8 Other sources .9 1.2 Gross investment income 107.5 102.4 Investment expenses (a) 1.7 1.1 Net investment income $ 105.8 $ 101.2 Investment gains (losses): From actual sale transactions: Fixed maturity securities: Gains $ .4 $ 2.8 Losses (.1 ) (.1 ) Net .2 2.6 Equity securities: Gains 14.9 12.1 Losses — — Net 14.9 12.1 Other long-term investments, net .2 — Total from actual sale transactions 15.5 14.8 From unrealized changes in fair value of equity securities (152.0 ) — From impairments — — Total investment gains (losses) (136.4 ) 14.8 Income taxes (credits) (28.7 ) 5.1 Net investment gains (losses) $ (107.7 ) $ 9.6 Changes in unrealized investment gains (losses) on: Fixed maturity securities $ (148.7 ) $ 17.0 Less: Deferred income taxes (credits) (31.3 ) 5.9 (117.4 ) 11.1 Equity securities & other long-term investments (.4 ) 48.1 Less: Deferred income taxes (credits) — 16.7 (.3 ) 31.3 Net changes in unrealized investment gains (losses) $ (117.8 ) $ 42.5 __________ (a) Investment expenses consist of personnel costs and investment management and custody service fees, as well as interest incurred on funds held of $.1 for both the quarters ended March 31, 2018 and 2017 . |
Losses, Claims and Settlement18
Losses, Claims and Settlement Expenses (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Insurance [Abstract] | |
Schedule of Changes in Aggregate Reserves for Losses, Claims and Settlement Expenses | The following table shows an analysis of changes in aggregate reserves for the Company's losses, claims and settlement expenses for each of the periods shown. Quarters Ended March 31, 2018 2017 Gross reserves at beginning of period $ 9,237.6 $ 9,206.0 Less: reinsurance losses recoverable 2,921.1 2,766.1 Net reserves at beginning of period: General Insurance 5,471.5 5,249.9 Title Insurance 559.7 602.0 RFIG Run-off 271.7 574.0 Other 13.5 13.8 Sub-total 6,316.4 6,439.8 Incurred claims and claim adjustment expenses: Provisions for insured events of the current year: General Insurance 546.3 513.3 Title Insurance 21.1 21.3 RFIG Run-off (a) 18.7 32.8 Other 5.7 7.0 Sub-total 591.9 574.6 Change in provision for insured events of prior years: General Insurance 15.9 10.1 Title Insurance (8.2 ) (10.3 ) RFIG Run-off (a) (7.2 ) (13.0 ) Other (2.3 ) (1.8 ) Sub-total (1.8 ) (15.1 ) Total incurred claims and claim adjustment expenses (a) 590.1 559.5 Payments: Claims and claim adjustment expenses attributable to insured events of the current year: General Insurance 104.2 94.1 Title Insurance .1 .2 RFIG Run-off (a)(b) — .2 Other 2.2 2.5 Sub-total 106.7 97.1 Claims and claim adjustment expenses attributable to insured events of prior years: General Insurance 368.0 367.5 Title Insurance 13.6 14.7 RFIG Run-off (b) 34.0 53.4 Other 2.4 2.2 Sub-total 418.1 437.8 Total payments (b) 524.8 535.0 Amount of reserves for unpaid claims and claim adjustment expenses at the end of each period, net of reinsurance losses recoverable: (c) General Insurance 5,561.5 5,311.7 Title Insurance 558.7 598.1 RFIG Run-off 249.1 540.2 Other 12.2 14.2 Sub-total 6,381.7 6,464.3 Reinsurance losses recoverable 2,890.7 2,766.9 Gross reserves at end of period $ 9,272.4 $ 9,231.3 __________ (a) In common with all other insurance coverages, RFIG Run-off mortgage guaranty settled and incurred claim and claim adjustment expenses include only those costs actually or expected to be paid by the Company. Changes in mortgage guaranty aggregate case, IBNR, and loss adjustment expense reserves shown below and entering into the determination of incurred claim costs, take into account, among a large number of variables, claim cost reductions for anticipated coverage rescissions and claims denials. The RFIG Run-off mortgage guaranty provision for insured events of the current year was reduced by estimated coverage rescissions and claims denials of $1.2 and $1.7 for the year-to-date periods ended March 31, 2018 and 2017 , respectively. The provision for insured events of prior years for the periods shown in the table was (increased) reduced by estimated coverage rescissions and claims denials of $(2.1) and $(1.6) , respectively. Prior year development was also affected in varying degrees by differences between actual claim settlements relative to expected experience, by reinstatement of previously rescinded or denied claims, and by subsequent revisions of assumptions in regards to claim frequency, severity or levels of associated claim settlement costs which result from consideration of underlying trends and expectations. (b) Rescissions reduced the Company's paid losses by an estimated $1.4 and $3.0 for the year-to-date periods ended March 31, 2018 and 2017 , respectively. (c) Net reserves for claims that have been incurred but are not yet reported ("IBNR") carried in each segment were as follows: March 31, March 31, December 31, 2018 2017 2017 General Insurance $ 2,686.9 $ 2,515.3 $ 2,585.9 Title Insurance 478.0 521.5 479.3 RFIG Run-off 30.0 208.6 30.5 Other 4.7 5.0 4.7 Total $ 3,199.8 $ 3,250.6 $ 3,100.6 |
Information About Segments of19
Information About Segments of Business (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting | The contributions of Old Republic's insurance industry segments to consolidated totals are shown in the following table. Quarters Ended March 31, 2018 2017 General Insurance: Net premiums earned $ 791.2 $ 742.8 Net investment income and other income 113.5 106.2 Total revenues before investment gains or losses $ 904.8 $ 849.0 Income before income taxes (credits) and investment gains or losses (a) $ 83.3 $ 93.7 Income tax expense (credits) on above $ 11.5 $ 28.0 Title Insurance: Net premiums earned $ 414.5 $ 418.3 Title, escrow and other fees 99.3 99.7 Sub-total 513.8 518.0 Net investment income and other income 9.7 9.7 Total revenues before investment gains or losses $ 523.6 $ 527.8 Income before income taxes (credits) and investment gains or losses (a) $ 29.5 $ 40.4 Income tax expense (credits) on above $ 6.3 $ 13.8 RFIG Run-off Business: Net premiums earned $ 21.3 $ 35.5 Net investment income and other income 5.3 5.5 Total revenues before investment gains or losses $ 26.7 $ 41.1 Income before income taxes (credits) and investment gains or losses $ 10.9 $ 14.5 Income tax expense (credits) on above $ 2.2 $ 5.2 Consolidated Revenues: Total revenues of above Company segments $ 1,455.2 $ 1,418.0 Other sources (b) 41.4 41.9 Consolidated investment gains (losses): Realized from actual transactions 15.5 14.8 Unrealized from changes in fair value of equity securities (152.0 ) — Total realized and unrealized investment gains (losses) (136.4 ) 14.8 Consolidation elimination adjustments (29.7 ) (29.9 ) Consolidated revenues $ 1,330.4 $ 1,444.8 Consolidated Income (Loss) Before Income Taxes (Credits): Total income before income taxes (credits) and investment gains or losses of above Company segments $ 123.8 $ 148.7 Other sources - net (b) 6.5 1.1 Consolidated investment gains (losses): Realized from actual transactions 15.5 14.8 Unrealized from changes in fair value of equity securities (152.0 ) — Total realized and unrealized investment gains (losses) (136.4 ) 14.8 Consolidated income (loss) before income taxes (credits) $ (6.0 ) $ 164.7 Consolidated Income Tax Expense (Credits): Total income tax expense (credits) for above Company segments $ 20.1 $ 47.1 Other sources - net (b) (1.5 ) (.7 ) Income tax expense (credits) on consolidated investment gains (losses) (28.7 ) 5.1 Consolidated income tax expense (credits) $ (10.1 ) $ 51.6 March 31, December 31, 2018 2017 Consolidated Assets: General Insurance $ 16,015.8 $ 16,055.5 Title Insurance 1,401.5 1,466.0 RFIG Run-off Business 777.3 805.0 Total assets for the above company segments 18,194.8 18,326.6 Other assets (b) 1,109.9 1,440.9 Consolidation elimination adjustments (305.9 ) (364.0 ) Consolidated assets $ 18,998.8 $ 19,403.5 __________ (a) Income before income taxes (credits) is reported net of interest charges on intercompany financing arrangements with Old Republic's holding company parent for the following segments: General - $15.4 and $14.1 for the quarters ended March 31, 2018 and 2017 , respectively, and Title - $1.4 and $2.1 for the quarters ended March 31, 2018 and 2017 , respectively. (b) Represents amounts for Old Republic's holding company parent, minor corporate services subsidiaries, and a small life and accident insurance operation. |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Consolidated debt of Old Republic and its subsidiaries is summarized below: March 31, 2018 December 31, 2017 Carrying Amount Fair Value Carrying Amount Fair Value 3.75% Convertible Senior Notes due 2018 $ — $ — $ 470.6 $ 652.2 4.875% Senior Notes due 2024 396.3 422.5 396.2 430.3 3.875% Senior Notes due 2026 545.3 541.4 545.1 553.9 ESSOP debt — — 4.2 4.2 Other miscellaneous debt with an average yield of 2.97% and 2.45%, respectively 32.4 32.5 32.4 32.5 Total debt $ 974.1 $ 996.5 $ 1,448.7 $ 1,673.2 |
Fair Value, Debt Measured on Recurring Basis | The following table shows a summary of the carrying value and fair value of financial liabilities segregated among the various input levels described in Note 3 above: Carrying Fair Value Value Level 1 Level 2 Level 3 Financial Liabilities: Debt: March 31, 2018 $ 974.1 $ 996.5 $ — $ 964.0 $ 32.5 December 31, 2017 $ 1,448.7 $ 1,673.2 $ — $ 1,636.5 $ 36.7 |
Summary of Significant Accoun21
Summary of Significant Accounting Policies Contract Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Non-insurance Contract Revenue | $ 40.7 | $ 37.7 |
General Insurance Group [Member] | ||
Contract Revenue - Claims Handling and Related Ancillary Services | $ 26.7 | $ 24.2 |
Percentage of total contract revenue | 65.60% | 64.20% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year | |
Title Insurance Segment [Member] | ||
Percentage of total contract revenue | 31.70% | 33.20% |
Non-insurance Contract Title Services | $ 12.9 | $ 12.5 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year |
Common Share Data (Details)
Common Share Data (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Earnings Per Share [Abstract] | |||
Net income | $ 4 | $ 113.1 | |
Numerator for basic earnings per share - income (loss) available to common stockholders | 4 | 113.1 | |
Adjustment for interest expense incurred on assumed conversions of convertible senior notes | 0 | 3.6 | |
Numerator for diluted earnings per share - income (loss) available to common stockholders after assumed conversions | $ 4 | $ 116.7 | |
Denominator for basic earnings per share - weighted-average shares (a) | [1] | 278,116,902 | 260,784,905 |
Effect of dilutive securities - stock based compensation awards | 1,411,132 | 1,703,231 | |
Effect of dilutive securities - convertible senior notes | 0 | 35,751,213 | |
Denominator for diluted earnings per shares adjusted weighted average shares and assumed conversions (a) (in shares) | [1] | 279,528,034 | 298,239,349 |
Net income (loss) per share: Basic (in dollars per share) | $ 0.01 | $ 0.43 | |
Net income (loss) per share: Diluted (in dollars per share) | $ 0.01 | $ 0.39 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive common stock equivalents excluded from earnings per share computations | 23,313,276 | 0 | |
Stock based compensation awards [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive common stock equivalents excluded from earnings per share computations | 1,539,500 | 0 | |
Convertible senior notes [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive common stock equivalents excluded from earnings per share computations | 21,773,776 | 0 | |
[1] | (a) In calculating earnings per share, pertinent accounting rules require that common shares owned by the Company's Employee Savings and Stock Ownership Plan that are not yet allocated to participants in the plan be excluded from the calculation. Such shares are issued and outstanding and have the same voting and other rights applicable to all other common shares. |
Investments Fixed Maturity Secu
Investments Fixed Maturity Securities by Type (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Schedule of Available-for-sale and Held-to-maturity Securities [Table] [Line Items] | ||
Available for sale, Fixed maturity securities (amortized cost) | $ 8,136.8 | $ 8,162.2 |
Available for sale, Fixed maturity securities (estimated fair value) | 8,107.8 | 8,282.3 |
Held to maturity (estimated fair value) | 1,038 | 1,069.2 |
U.S. & Canadian Governments [Member] | ||
Schedule of Available-for-sale and Held-to-maturity Securities [Table] [Line Items] | ||
Available for sale, Fixed maturity securities (amortized cost) | 1,455.2 | 1,554.3 |
Available for sale, Fixed maturity securities (gross unrealized gains) | 2.8 | 6.5 |
Available for sale, Fixed maturity securities (gross unrealized losses) | 22.4 | 8.7 |
Available for sale, Fixed maturity securities (estimated fair value) | 1,435.6 | 1,552.2 |
Tax-exempt [Member] | ||
Schedule of Available-for-sale and Held-to-maturity Securities [Table] [Line Items] | ||
Held-to-maturity Securities, Amortized Cost before Other than Temporary Impairment | 1,061.8 | 1,067.4 |
Held to maturity (gross unrealized gains) | 0.8 | 10 |
Held to maturity (gross unrealized losses) | 24.6 | 8.3 |
Held to maturity (estimated fair value) | 1,038 | 1,069.2 |
Corporate [Member] | ||
Schedule of Available-for-sale and Held-to-maturity Securities [Table] [Line Items] | ||
Available for sale, Fixed maturity securities (amortized cost) | 6,681.6 | 6,607.8 |
Available for sale, Fixed maturity securities (gross unrealized gains) | 66.7 | 140.8 |
Available for sale, Fixed maturity securities (gross unrealized losses) | 76.1 | 18.6 |
Available for sale, Fixed maturity securities (estimated fair value) | 6,672.1 | 6,730 |
Fixed Maturity Securities [Member] | ||
Schedule of Available-for-sale and Held-to-maturity Securities [Table] [Line Items] | ||
Available for sale, Fixed maturity securities (amortized cost) | 8,136.8 | 8,162.2 |
Available for sale, Fixed maturity securities (gross unrealized gains) | 69.6 | 147.4 |
Available for sale, Fixed maturity securities (gross unrealized losses) | 98.6 | 27.3 |
Available for sale, Fixed maturity securities (estimated fair value) | $ 8,107.8 | $ 8,282.3 |
Investments Fair Value (Details
Investments Fair Value (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Held to maturity (amortized cost) | $ 1,061.8 | $ 1,067.4 |
Equity securities | 3,149.7 | 3,265.5 |
Available for sale, Fixed maturity securities | 8,107.8 | 8,282.3 |
Short-term investments | 474.9 | 670.1 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 474.9 | 670.1 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
U.S. & Canadian Governments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale, Fixed maturity securities | 1,435.6 | 1,552.2 |
U.S. & Canadian Governments [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale, Fixed maturity securities | 645.7 | 761.4 |
U.S. & Canadian Governments [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale, Fixed maturity securities | 789.9 | 790.8 |
U.S. & Canadian Governments [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale, Fixed maturity securities | 0 | 0 |
Tax-exempt [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Held to maturity (amortized cost) | 1,038 | 1,069.2 |
Tax-exempt [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Held to maturity (amortized cost) | 0 | 0 |
Tax-exempt [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Held to maturity (amortized cost) | 1,038 | 1,069.2 |
Tax-exempt [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Held to maturity (amortized cost) | 0 | 0 |
Corporate [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale, Fixed maturity securities | 6,672.1 | 6,730 |
Corporate [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale, Fixed maturity securities | 0 | 0 |
Corporate [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale, Fixed maturity securities | 6,661.6 | 6,719.5 |
Corporate [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale, Fixed maturity securities | 10.5 | 10.5 |
Equity Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities | 3,149.7 | 3,265.5 |
Available-for-sale, equity securities | 3,149.7 | 3,265.5 |
Equity Securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities | 3,148.6 | 3,264.4 |
Equity Securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities | 0 | 0 |
Equity Securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities | $ 1.1 | $ 1.1 |
Investments Net Investment Inco
Investments Net Investment Income (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Gain (Loss) on Investments [Line Items] | |||
Gross investment income | $ 107.5 | $ 102.4 | |
Investment expenses | [1] | 1.7 | 1.1 |
Net investment income | 105.8 | 101.2 | |
Net realized gains (losses) | (107.7) | 9.6 | |
Realized from actual transactions | 15.5 | 14.8 | |
Unrealized from changes in fair value of equity securities | (152) | 0 | |
Realized Investment Gains Losses From Impairment | 0 | 0 | |
Total investment gains (losses) | (136.4) | 14.8 | |
Income taxes (credits) | (28.7) | 5.1 | |
Interest expense incurred on funds held | 0.1 | 0.1 | |
Unrealized Gain (Loss) on Investments | (117.8) | 42.5 | |
Equity Securities [Member] | |||
Gain (Loss) on Investments [Line Items] | |||
Equity securities, gross realized gains | 14.9 | 12.1 | |
Equity securities, gross realized losses | 0 | 0 | |
Equity securities, net realized gains (losses) | 14.9 | 12.1 | |
Fixed Maturity Securities [Member] | |||
Gain (Loss) on Investments [Line Items] | |||
Fixed maturity securities, gross realized gains | 0.4 | 2.8 | |
Fixed maturity securities, gross realized losses | (0.1) | (0.1) | |
Net realized gains (losses) | 0.2 | 2.6 | |
Changes in unrealized investment gains (losses) on, fixed maturity securities | (148.7) | 17 | |
Less: Deferred income taxes (credits) | (31.3) | 5.9 | |
Net changes in unrealized investment gains (losses) | (117.4) | 11.1 | |
Equity securities & other long-term investments [Member] | |||
Gain (Loss) on Investments [Line Items] | |||
Changes in unrealized investment gains (losses) on, fixed maturity securities | (0.4) | 48.1 | |
Less: Deferred income taxes (credits) | 0 | 16.7 | |
Net changes in unrealized investment gains (losses) | (0.3) | 31.3 | |
Other Investments | |||
Gain (Loss) on Investments [Line Items] | |||
Other long-term investments, net | 0.2 | 0 | |
Fixed Maturity Securities [Member] | |||
Gain (Loss) on Investments [Line Items] | |||
Gross investment income | 74.2 | 74.2 | |
Equity Securities [Member] | |||
Gain (Loss) on Investments [Line Items] | |||
Gross investment income | 30.4 | 26.1 | |
Short-term Investments [Member] | |||
Gain (Loss) on Investments [Line Items] | |||
Gross investment income | 1.9 | 0.8 | |
Investments [Member] | |||
Gain (Loss) on Investments [Line Items] | |||
Gross investment income | $ 0.9 | $ 1.2 | |
[1] | Investment expenses consist of personnel costs and investment management and custody service fees, as well as interest incurred on funds held of $.1 for both the quarters ended March 31, 2018 and 2017. |
Investments Textuals (Details)
Investments Textuals (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2017 | |
Schedule of Available-for-sale Securities [Line Items] | |||
Net Unrealized Gains Losses Recognized from Changes in Fair Value of Equity Securities Held | $ (131.3) | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | 502.1 | ||
Unrealized from changes in fair value of equity securities | (152) | $ 0 | |
Realized Investment Gains Losses From Impairment | 0 | 0 | |
Interest expense incurred on funds held | $ 0.1 | $ 0.1 | |
Fixed Maturity Securities [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Securities in unrealized loss positions, number of securities | 1,296 | 742 | |
Percentage of securities in unrealized loss position | 65.90% | 37.60% | |
Number of securities in continuous unrealized loss position for more than 12 months | 353 | 104 | |
Equity Securities [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Securities in unrealized loss positions, number of positions | 9 | ||
Percentage of securities in unrealized loss position | 9.50% |
Investments Fixed Maturity Se27
Investments Fixed Maturity Securities Stratified by Contractual Maturity (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Investments [Abstract] | ||
Available for sale, Due in one year or less (amortized cost) | $ 737.6 | |
Available for sale, Due after one year through five years (amortized cost) | 4,296.1 | |
Available for sale, Due after five years through ten years (amortized cost) | 3,000.9 | |
Available for sale, Due after ten years (amortized cost) | 102 | |
Available for sale, Fixed maturity securities (amortized cost) | 8,136.8 | $ 8,162.2 |
Available for sale, Due in one year or less (estimated fair value) | 741.1 | |
Available for sale, Due after one year through five years (estimated fair value) | 4,295.3 | |
Available for sale, Due after five years through ten years (estimated fair value) | 2,963.8 | |
Available for sale, Due after ten years (estimated fair value) | 107.5 | |
Available for sale, Fixed maturity securities (estimated fair value) | 8,107.8 | 8,282.3 |
Held to maturity, Due within one year or less (amortized cost) | 0 | |
Held to maturity, Due after one year through five years (amortized cost) | 93.1 | |
Held to maturity, Due after five years through then years (amortized cost) | 960.5 | |
Held to maturity, Due after ten years (amortized cost) | 8.1 | |
Held to maturity (amortized cost) | 1,061.8 | 1,067.4 |
Held to maturity, Due in one year or less (estimated fair value) | 0 | |
Held to maturity, Due after one year through five years (estimated fair value) | 91.1 | |
Held to maturity, Due after five years through ten years (estimated fair value) | 938.7 | |
Held to maturity, Due after ten years (estimated fair value) | 8.1 | |
Held to maturity (estimated fair value) | $ 1,038 | $ 1,069.2 |
Investments Gross Unrealized Lo
Investments Gross Unrealized Losses and Fair Value (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
Schedule of Available-for-sale and Held-to-maturity Securities [Table] [Line Items] | ||
Available for sale, Fair Value, 12 Months or Less | $ 4,262.2 | $ 3,417.9 |
Available for sale, Unrealized Losses, 12 Months or Less | 74.1 | 51.7 |
Available for sale, Fair Value, Greater than 12 Months | 1,451.2 | 310.2 |
Available for sale, Unrealized Losses, Greater than 12 Months | 49.1 | 7.2 |
Available for sale, Fair Value, Total | 5,713.5 | 3,728.2 |
Available for sale, Unrealized Losses, Total | 123.2 | 58.9 |
U.S. & Canadian Governments [Member] | ||
Schedule of Available-for-sale and Held-to-maturity Securities [Table] [Line Items] | ||
Available for sale, Fair Value, 12 Months or Less | 761.3 | 1,080.9 |
Available for sale, Unrealized Losses, 12 Months or Less | 13.4 | 8.6 |
Available for sale, Fair Value, Greater than 12 Months | 382.8 | 29.5 |
Available for sale, Unrealized Losses, Greater than 12 Months | 8.9 | 0 |
Available for sale, Fair Value, Total | 1,144.1 | 1,110.5 |
Available for sale, Unrealized Losses, Total | 22.4 | 8.7 |
Tax-exempt [Member] | ||
Schedule of Available-for-sale and Held-to-maturity Securities [Table] [Line Items] | ||
Available for sale, Fair Value, 12 Months or Less | 507.8 | 321.9 |
Available for sale, Unrealized Losses, 12 Months or Less | 7.1 | 4.8 |
Available for sale, Fair Value, Greater than 12 Months | 404.3 | 134.7 |
Available for sale, Unrealized Losses, Greater than 12 Months | 17.4 | 3.4 |
Available for sale, Fair Value, Total | 912.2 | 456.6 |
Available for sale, Unrealized Losses, Total | 24.6 | 8.3 |
Corporate [Member] | ||
Schedule of Available-for-sale and Held-to-maturity Securities [Table] [Line Items] | ||
Available for sale, Fair Value, 12 Months or Less | 2,992.9 | 1,660.9 |
Available for sale, Unrealized Losses, 12 Months or Less | 53.5 | 15 |
Available for sale, Fair Value, Greater than 12 Months | 664 | 145.9 |
Available for sale, Unrealized Losses, Greater than 12 Months | 22.6 | 3.6 |
Available for sale, Fair Value, Total | 3,657 | 1,806.9 |
Available for sale, Unrealized Losses, Total | $ 76.1 | 18.6 |
Fixed Maturity Securities [Member] | ||
Schedule of Available-for-sale and Held-to-maturity Securities [Table] [Line Items] | ||
Available for sale, Fair Value, 12 Months or Less | 3,063.9 | |
Available for sale, Unrealized Losses, 12 Months or Less | 28.5 | |
Available for sale, Fair Value, Greater than 12 Months | 310.2 | |
Available for sale, Unrealized Losses, Greater than 12 Months | 7.2 | |
Available for sale, Fair Value, Total | 3,374.1 | |
Available for sale, Unrealized Losses, Total | 35.7 | |
Equity Securities [Member] | ||
Schedule of Available-for-sale and Held-to-maturity Securities [Table] [Line Items] | ||
Available for sale, Fair Value, 12 Months or Less | 354 | |
Available for sale, Unrealized Losses, 12 Months or Less | 23.2 | |
Available for sale, Fair Value, Greater than 12 Months | 0 | |
Available for sale, Unrealized Losses, Greater than 12 Months | 0 | |
Available for sale, Fair Value, Total | 354 | |
Available for sale, Unrealized Losses, Total | $ 23.2 |
Investments Equity Securities (
Investments Equity Securities (Details) - Equity Securities [Member] - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Schedule of Available-for-sale Securities [Line Items] | ||
Equity securities - cost | $ 2,666.1 | $ 2,629.9 |
Equity securities, gross unrealized gains | 526.6 | 658.8 |
Equity securities, gross unrealized losses | 42.9 | 23.2 |
Available-for-sale, equity securities | $ 3,149.7 | $ 3,265.5 |
Losses, Claims and Settlement30
Losses, Claims and Settlement Expenses (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | |
Liability for Unpaid Claims and Claims Adjustment Expense | ||||
Gross reserves at beginning of period | $ 9,237.6 | $ 9,206 | ||
Net reserves at beginning of period | $ 6,316.4 | $ 6,439.8 | ||
Provisions for insured events of the current year | 591.9 | 574.6 | ||
Change in provision for insured events of prior years | (1.8) | (15.1) | ||
Total incurred claims and claim adjustment expenses | 590.1 | 559.5 | ||
Claims and claim adjustment expenses attributable to insured events of the current year | 106.7 | 97.1 | ||
Claims and claim adjustment expenses attributable to insured events of prior years | 418.1 | 437.8 | ||
Total payments | 524.8 | 535 | ||
Amount of reserves for unpaid claims and claim adjustment expenses at the end of each period, net of reinsurance losses recoverable | 6,381.7 | 6,464.3 | ||
Gross reserves at end of period | 9,272.4 | 9,231.3 | ||
Net reserves for claims that have been incurred but are not yet reported | 3,199.8 | 3,250.6 | 3,100.6 | |
Reinsurance losses recoverable | ||||
Supplementary Insurance Information, by Segment [Line Items] | ||||
Reinsurance Recoverable for Unpaid Claims and Claims Adjustments | 2,921.1 | 2,766.1 | ||
Liability for Unpaid Claims and Claims Adjustment Expense | ||||
Less: reinsurance losses recoverable | 2,890.7 | 2,766.9 | ||
General Insurance | ||||
Liability for Unpaid Claims and Claims Adjustment Expense | ||||
Net reserves at beginning of period | 5,471.5 | 5,249.9 | ||
Provisions for insured events of the current year | 546.3 | 513.3 | ||
Change in provision for insured events of prior years | 15.9 | 10.1 | ||
Claims and claim adjustment expenses attributable to insured events of the current year | 104.2 | 94.1 | ||
Claims and claim adjustment expenses attributable to insured events of prior years | 368 | 367.5 | ||
Amount of reserves for unpaid claims and claim adjustment expenses at the end of each period, net of reinsurance losses recoverable | 5,561.5 | 5,311.7 | ||
Net reserves for claims that have been incurred but are not yet reported | 2,686.9 | 2,515.3 | 2,585.9 | |
Title Insurance | ||||
Liability for Unpaid Claims and Claims Adjustment Expense | ||||
Net reserves at beginning of period | 559.7 | 602 | ||
Provisions for insured events of the current year | 21.1 | 21.3 | ||
Change in provision for insured events of prior years | (8.2) | (10.3) | ||
Claims and claim adjustment expenses attributable to insured events of the current year | 0.1 | 0.2 | ||
Claims and claim adjustment expenses attributable to insured events of prior years | 13.6 | 14.7 | ||
Amount of reserves for unpaid claims and claim adjustment expenses at the end of each period, net of reinsurance losses recoverable | 558.7 | 598.1 | ||
Net reserves for claims that have been incurred but are not yet reported | 478 | 521.5 | 479.3 | |
RFIG Run-off | ||||
Liability for Unpaid Claims and Claims Adjustment Expense | ||||
Net reserves at beginning of period | 271.7 | 574 | ||
Provisions for insured events of the current year | 18.7 | 32.8 | ||
Change in provision for insured events of prior years | (7.2) | (13) | ||
Claims and claim adjustment expenses attributable to insured events of the current year | 0 | 0.2 | ||
Claims and claim adjustment expenses attributable to insured events of prior years | 34 | 53.4 | ||
Amount of reserves for unpaid claims and claim adjustment expenses at the end of each period, net of reinsurance losses recoverable | 249.1 | 540.2 | ||
Current year estimated coverage rescissions and claims denials | 1.2 | 1.7 | ||
Prior period estimated coverage rescissions and claims denials | (2.1) | (1.6) | ||
Estimated reduction in paid losses from rescissions | 1.4 | 3 | ||
Net reserves for claims that have been incurred but are not yet reported | 30 | 208.6 | 30.5 | |
Other | ||||
Liability for Unpaid Claims and Claims Adjustment Expense | ||||
Net reserves at beginning of period | 13.5 | $ 13.8 | ||
Provisions for insured events of the current year | 5.7 | 7 | ||
Change in provision for insured events of prior years | (2.3) | (1.8) | ||
Claims and claim adjustment expenses attributable to insured events of the current year | 2.2 | 2.5 | ||
Claims and claim adjustment expenses attributable to insured events of prior years | 2.4 | 2.2 | ||
Amount of reserves for unpaid claims and claim adjustment expenses at the end of each period, net of reinsurance losses recoverable | 12.2 | 14.2 | ||
Net reserves for claims that have been incurred but are not yet reported | $ 4.7 | $ 5 | $ 4.7 |
Information About Segments of31
Information About Segments of Business (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Segment Reporting Information | |||
Realized from actual transactions | $ 15.5 | $ 14.8 | |
Unrealized from changes in fair value of equity securities | (152) | 0 | |
Consolidated Revenues [Abstract] | |||
Consolidated revenues | 1,330.4 | 1,444.8 | |
Net premiums earned | 1,231 | 1,201.3 | |
Title, escrow and other fees | 99.3 | 99.7 | |
Total premiums and fees | 1,330.4 | 1,301 | |
Total investment gains (losses) | (136.4) | 14.8 | |
Total operating revenues | 1,466.8 | 1,429.9 | |
Consolidated Income (Loss) Before Taxes (Credits) [Abstract] | |||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest | (6) | 164.7 | |
Total investment gains (losses) | (136.4) | 14.8 | |
Consolidated Income Tax Expense (Credits) [Abstract] | |||
Income tax expense (credits) | (10.1) | 51.6 | |
Income tax expense (credits) on consolidated net realized investment gains (losses) | (28.7) | 5.1 | |
Total Company Segments [Member] | |||
Consolidated Revenues [Abstract] | |||
Consolidated revenues | 1,455.2 | 1,418 | |
Consolidated Income (Loss) Before Taxes (Credits) [Abstract] | |||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest | 123.8 | 148.7 | |
Consolidated Income Tax Expense (Credits) [Abstract] | |||
Income tax expense (credits) | 20.1 | 47.1 | |
General Insurance Group [Member] | |||
Consolidated Revenues [Abstract] | |||
Net premiums earned | 791.2 | 742.8 | |
Net investment income and other income | 113.5 | 106.2 | |
Income (loss) before income taxes (credits) and realized investment gains or losses | [1] | 83.3 | 93.7 |
Total operating revenues | 904.8 | 849 | |
Consolidated Income Tax Expense (Credits) [Abstract] | |||
Income tax expense (credits) | 11.5 | 28 | |
Interest charges on intercompany financing arrangements | 15.4 | 14.1 | |
Title Insurance Segment [Member] | |||
Consolidated Revenues [Abstract] | |||
Net premiums earned | 414.5 | 418.3 | |
Title, escrow and other fees | 99.3 | 99.7 | |
Total premiums and fees | 513.8 | 518 | |
Net investment income and other income | 9.7 | 9.7 | |
Income (loss) before income taxes (credits) and realized investment gains or losses | [1] | 29.5 | 40.4 |
Total operating revenues | 523.6 | 527.8 | |
Consolidated Income Tax Expense (Credits) [Abstract] | |||
Income tax expense (credits) | 6.3 | 13.8 | |
Interest charges on intercompany financing arrangements | 1.4 | 2.1 | |
RFIG Run-off Business [Member] | |||
Consolidated Revenues [Abstract] | |||
Net premiums earned | 21.3 | 35.5 | |
Net investment income and other income | 5.3 | 5.5 | |
Income (loss) before income taxes (credits) and realized investment gains or losses | 10.9 | 14.5 | |
Total operating revenues | 26.7 | 41.1 | |
Consolidated Income Tax Expense (Credits) [Abstract] | |||
Income tax expense (credits) | 2.2 | 5.2 | |
Other sources - net [Member] | |||
Consolidated Revenues [Abstract] | |||
Consolidated revenues | [2] | 41.4 | 41.9 |
Consolidated Income (Loss) Before Taxes (Credits) [Abstract] | |||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest | [2] | 6.5 | 1.1 |
Consolidated Income Tax Expense (Credits) [Abstract] | |||
Income tax expense (credits) | [2] | (1.5) | (0.7) |
Consolidation elimination adjustments [Member] | |||
Consolidated Revenues [Abstract] | |||
Consolidated revenues | $ (29.7) | $ (29.9) | |
[1] | Income before income taxes (credits) is reported net of interest charges on intercompany financing arrangements with Old Republic's holding company parent for the following segments: General - $15.4 and $14.1 for the quarters ended March 31, 2018 and 2017, respectively, and Title - $1.4 and $2.1 for the quarters ended March 31, 2018 and 2017, respectively. | ||
[2] | Represents amounts for Old Republic's holding company parent, minor corporate services subsidiaries, and a small life and accident insurance operation. |
Information About Segments of32
Information About Segments of Business Textuals (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2018USD ($)segment | Mar. 31, 2017USD ($) | |
Segment Reporting Information | ||
Number of major segments | segment | 3 | |
General Insurance Group [Member] | ||
Segment Reporting Information | ||
Interest charges on intercompany financing arrangements | $ 15.4 | $ 14.1 |
Title Insurance Segment [Member] | ||
Segment Reporting Information | ||
Interest charges on intercompany financing arrangements | $ 1.4 | $ 2.1 |
Information About Segments of33
Information About Segments of Business Reconciliation of Assets from Segment to Consolidated (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Segment Reporting, Asset Reconciling Item | ||
Assets | $ 18,998.8 | $ 19,403.5 |
General Insurance Group [Member] | ||
Segment Reporting, Asset Reconciling Item | ||
Assets | 16,015.8 | 16,055.5 |
Title Insurance Segment [Member] | ||
Segment Reporting, Asset Reconciling Item | ||
Assets | 1,401.5 | 1,466 |
RFIG Run-off Business [Member] | ||
Segment Reporting, Asset Reconciling Item | ||
Assets | 777.3 | 805 |
Total Company Segments [Member] | ||
Segment Reporting, Asset Reconciling Item | ||
Assets | 18,194.8 | 18,326.6 |
All Other Segments [Member] | ||
Segment Reporting, Asset Reconciling Item | ||
Assets | 1,109.9 | 1,440.9 |
Intersegment Elimination [Member] | ||
Segment Reporting, Asset Reconciling Item | ||
Assets | $ (305.9) | $ (364) |
Debt (Details)
Debt (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||
Fair value | $ 996.5 | $ 1,673.2 |
Debt and Capital Lease Obligations | $ 974.1 | 1,448.7 |
Debt Conversion, Converted Instrument, Shares Issued | 32,229,787 | |
Convertible Senior Notes Due 2018 | ||
Debt Instrument [Line Items] | ||
Fair value | $ 0 | 652.2 |
Debt and Capital Lease Obligations | $ 0 | 470.6 |
Debt Instrument, Interest Rate, Stated Percentage | 3.75% | |
Senior Notes Due 2024 | ||
Debt Instrument [Line Items] | ||
Debt | $ 400 | 400 |
Fair value | 422.5 | 430.3 |
Debt and Capital Lease Obligations | $ 396.3 | 396.2 |
Debt Instrument, Interest Rate, Stated Percentage | 4.875% | |
Senior Notes Due 2026 [Member] | ||
Debt Instrument [Line Items] | ||
Debt | $ 550 | 550 |
Fair value | 541.4 | 553.9 |
Debt and Capital Lease Obligations | $ 545.3 | 545.1 |
Debt Instrument, Interest Rate, Stated Percentage | 3.875% | |
ESSOP Debt | ||
Debt Instrument [Line Items] | ||
Fair value | $ 0 | 4.2 |
Debt and Capital Lease Obligations | 0 | 4.2 |
Debt [Member] | ||
Debt Instrument [Line Items] | ||
Fair value | 32.5 | 32.5 |
Debt and Capital Lease Obligations | $ 32.4 | $ 32.4 |
Debt, Weighted Average Interest Rate | 2.97% | 2.45% |
Debt Financial Liabilities Disc
Debt Financial Liabilities Disclosed, but not Carried, at Fair Value (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | $ 974.1 | $ 1,448.7 |
Estimate of Fair Value Measurement [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | 996.5 | 1,673.2 |
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | 0 | 0 |
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | 964 | 1,636.5 |
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | 32.5 | 36.7 |
Reported Value Measurement [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | $ 974.1 | $ 1,448.7 |