Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Jan. 31, 2014 | Jun. 30, 2013 | |
Document Type | '10-K | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Trading Symbol | 'PGR | ' | ' |
Entity Registrant Name | 'PROGRESSIVE CORP/OH/ | ' | ' |
Entity Central Index Key | '0000080661 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Filer Category | 'Large Accelerated Filer | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 595,282,483 | ' |
Entity Public Float | ' | ' | $14,008,711,206 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Revenues | ' | ' | ' |
Net premiums earned | $17,103.40 | $16,018 | $14,902.80 |
Investment income | 422 | 443 | 480 |
Other-than-temporary impairment (OTTI) losses: | ' | ' | ' |
Total OTTI losses | -6 | -7.3 | -6 |
Non-credit losses, net of credit losses recognized on previously recorded non-credit OTTI losses | -0.1 | -0.7 | 0.5 |
Net impairment losses recognized in earnings | -6.1 | -8 | -5.5 |
Net realized gains (losses) on securities | 324.5 | 314.8 | 108.1 |
Total net realized gains (losses) on securities | 318.4 | 306.8 | 102.6 |
Fees and other revenues | 291.8 | 281.8 | 266.5 |
Service revenues | 39.6 | 36.1 | 22.8 |
Gains (losses) on extinguishment of debt | -4.3 | -1.8 | -0.1 |
Total revenues | 18,170.90 | 17,083.90 | 15,774.60 |
Expenses | ' | ' | ' |
Losses and loss adjustment expenses | 12,472.40 | 11,948 | 10,634.80 |
Policy acquisition costs | 1,451.80 | 1,436.60 | 1,399.20 |
Other underwriting expenses | 2,350.90 | 2,206.30 | 2,088 |
Investment expenses | 18.8 | 15.4 | 13.5 |
Service expenses | 38.8 | 36.1 | 19.4 |
Interest expense | 118.2 | 123.8 | 132.7 |
Total expenses | 16,450.90 | 15,766.20 | 14,287.60 |
Net Income | ' | ' | ' |
Income before income taxes | 1,720 | 1,317.70 | 1,487 |
Provision for income taxes | 554.6 | 415.4 | 471.5 |
Net income | 1,165.40 | 902.3 | 1,015.50 |
Net unrealized gains (losses) on securities: | ' | ' | ' |
Net non-credit related OTTI losses, adjusted for valuation changes | 0.3 | 5.1 | -3.6 |
Other net unrealized gains (losses) on securities | 84 | 174.8 | -80.9 |
Total net unrealized gains (losses) on securities | 84.3 | 179.9 | -84.5 |
Net unrealized gains on forecasted transactions | -2 | -1.8 | -6.8 |
Foreign currency translation adjustment | -1.6 | 0.4 | 0.1 |
Other comprehensive income (loss) | 80.7 | 178.5 | -91.2 |
Comprehensive income | $1,246.10 | $1,080.80 | $924.30 |
Computation of Net Income Per Share | ' | ' | ' |
Average shares outstanding - Basic (shares) | 599.1 | 603.3 | 632.3 |
Net effect of dilutive stock-based compensation (shares) | 4.5 | 4.5 | 4.6 |
Total equivalent shares - Diluted (shares) | 603.6 | 607.8 | 636.9 |
Basic: Net income per share (USD per share) | $1.95 | $1.50 | $1.61 |
Diluted: Net income per share (USD per share) | $1.93 | $1.48 | $1.59 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Millions, unless otherwise specified | ||||
Investments - Available-for-sale, at fair value: | ' | ' | ||
Fixed maturities (amortized cost: $13,415.3 and $11,373.9) | $13,540.40 | $11,774.10 | ||
Equity securities: | ' | ' | ||
Nonredeemable preferred stocks (cost: $445.7 and $404.0) | 711.2 | 812.4 | ||
Common equities (cost: $1,451.1 and $1,370.3) | 2,530.50 | 1,899 | ||
Short-term investments (amortized cost: $1,272.6 and $1,990.0) | 1,272.60 | 1,990 | ||
Total investments at fair value | 18,054.70 | [1],[2] | 16,475.50 | [1],[2] |
Cash | 75.1 | 179.1 | ||
Accrued investment income | 89.8 | 90 | ||
Premiums receivable, net of allowance for doubtful accounts of $142.4 and $138.6 | 3,310.70 | 3,183.70 | ||
Reinsurance recoverables, including $44.3 and $38.9 on paid losses and loss adjustment expenses | 1,090.20 | 901 | ||
Prepaid reinsurance premiums | 74.9 | 66.3 | ||
Deferred acquisition costs | 447.6 | 434.5 | ||
Property and equipment, net of accumulated depreciation of $680.4 and $625.0 | 960.9 | 933.7 | ||
Net deferred income taxes | 0 | 109.4 | ||
Other assets | 304.3 | 321.5 | ||
Total assets | 24,408.20 | 22,694.70 | ||
Liabilities and Shareholders' Equity | ' | ' | ||
Unearned premiums | 5,174.50 | 4,930.70 | ||
Loss and loss adjustment expense reserves | 8,479.70 | 7,838.40 | ||
Net deferred income taxes | 28.4 | 0 | ||
Dividends Payable | 890.2 | 172 | ||
Accounts payable, accrued expenses, and other liabilities | 1,785 | [3] | 1,683.50 | [3] |
Debt | 1,860.90 | [4] | 2,063.10 | [4] |
Total liabilities | 18,218.70 | 16,687.70 | ||
Common shares, $1.00 par value (authorized 900.0; issued 797.6 and 797.7, including treasury shares of 201.8 and 193.1) | 595.8 | 604.6 | ||
Paid-in capital | 1,142 | 1,077 | ||
Retained earnings | 3,500 | 3,454.40 | ||
Accumulated other comprehensive income, net of tax: | ' | ' | ||
Net non-credit related OTTI losses, adjusted for valuation changes | 0 | -0.3 | ||
Other net unrealized gains (losses) on securities | 947 | 863 | ||
Total net unrealized gains (losses) on securities | 947 | 862.7 | ||
Net unrealized gains on forecasted transactions | 4.1 | 6.1 | ||
Foreign currency translation adjustment | 0.6 | 2.2 | ||
Total accumulated other comprehensive income | 951.7 | 871 | ||
Total shareholders' equity | 6,189.50 | 6,007 | ||
Total liabilities and shareholders' equity | $24,408.20 | $22,694.70 | ||
[1] | The total fair value of the portfolio included $1.8 billion and $1.4 billion at December 31, 2013 and 2012, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of any unsettled security transactions. | |||
[2] | Reflected in our total portfolio are unsettled security transactions and collateral on open derivative positions, which collectively reflect a liability of $61.3 million at December 31, 2013, compared to an asset of $90.9 million at December 31, 2012. | |||
[3] | See Note 12 – Litigation and Note 13 – Commitments and Contingencies for further discussion. | |||
[4] | Consists of both short- and long-term debt. See Note 4 – Debt for further discussion. |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, except Per Share data, unless otherwise specified | ||
Fixed maturities, amortized cost | $13,415.30 | $11,373.90 |
Nonredeemable preferred stocks, cost | 445.7 | 404 |
Common equities, cost | 1,451.10 | 1,370.30 |
Short-term investments, amortized cost | 1,272.60 | 1,990 |
Premiums receivable, allowance for doubtful accounts | 142.4 | 138.6 |
Reinsurance recoverables, paid losses and loss adjustment expenses | 44.3 | 38.9 |
Property and equipment, accumulated depreciation | $680.40 | $625 |
Common Shares, par value (USD per share) | $1 | $1 |
Common Shares, authorized (shares) | 900 | 900 |
Common Shares, issued (shares) | 797.6 | 797.7 |
Common Shares, treasury shares (shares) | 201.8 | 193.1 |
Consolidated_Statements_of_Cha
Consolidated Statements of Changes in Shareholders' Equity (USD $) | Total | Common Shares, $1.00 Par Value | Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income, Net of Tax | |
In Millions | ||||||
Balance, Beginning of year at Dec. 31, 2010 | ' | $662.40 | $1,007.10 | $3,595.70 | $783.70 | |
Stock options exercised | ' | 2 | 20.4 | ' | ' | |
Net income | 1,015.50 | ' | ' | 1,015.50 | ' | |
Other comprehensive income (loss) | -91.2 | ' | ' | ' | -91.2 | |
Tax benefit from exercise/vesting of equity-based compensation | ' | ' | 6.4 | ' | ' | |
Treasury shares purchased | [1] | ' | -51.3 | -80.7 | -865.8 | ' |
Net restricted equity awards (issued) (vested) forfeited | ' | -0.1 | 0.1 | ' | ' | |
Cash dividends declared on common shares ($1.4929, $1.2845, and $.4072 per share) | ' | ' | ' | -248.1 | ' | |
Amortization of equity-based compensation | ' | ' | 50.3 | ' | ' | |
Reinvested dividends on restricted stock units | ' | ' | 2.6 | -2.6 | ' | |
Other | ' | ' | 0 | 0.3 | ' | |
Balance, End of year at Dec. 31, 2011 | 5,806.70 | 613 | 1,006.20 | 3,495 | 692.5 | |
Stock options exercised | ' | 0.1 | 0.4 | ' | ' | |
Net income | 902.3 | ' | ' | 902.3 | ' | |
Other comprehensive income (loss) | 178.5 | ' | ' | ' | 178.5 | |
Tax benefit from exercise/vesting of equity-based compensation | ' | ' | 5.8 | ' | ' | |
Treasury shares purchased | [1] | ' | -8.6 | -14.5 | -151.1 | ' |
Net restricted equity awards (issued) (vested) forfeited | ' | 0.1 | -0.1 | ' | ' | |
Cash dividends declared on common shares ($1.4929, $1.2845, and $.4072 per share) | ' | ' | ' | -772.5 | ' | |
Amortization of equity-based compensation | ' | ' | 62.4 | ' | ' | |
Reinvested dividends on restricted stock units | ' | ' | 11.2 | -11.2 | ' | |
Other | ' | ' | 5.6 | -8.1 | ' | |
Balance, End of year at Dec. 31, 2012 | 6,007 | 604.6 | 1,077 | 3,454.40 | 871 | |
Stock options exercised | ' | 0 | 0 | ' | ' | |
Net income | 1,165.40 | ' | ' | 1,165.40 | ' | |
Other comprehensive income (loss) | 80.7 | ' | ' | ' | 80.7 | |
Tax benefit from exercise/vesting of equity-based compensation | ' | ' | 10.3 | ' | ' | |
Treasury shares purchased | [1] | ' | -11 | -20.4 | -242 | ' |
Net restricted equity awards (issued) (vested) forfeited | ' | 2.2 | -2.2 | ' | ' | |
Cash dividends declared on common shares ($1.4929, $1.2845, and $.4072 per share) | ' | ' | ' | -889.2 | ' | |
Amortization of equity-based compensation | ' | ' | 64.9 | ' | ' | |
Reinvested dividends on restricted stock units | ' | ' | 12.4 | -12.4 | ' | |
Other | ' | ' | 0 | 23.8 | ' | |
Balance, End of year at Dec. 31, 2013 | $6,189.50 | $595.80 | $1,142 | $3,500 | $951.70 | |
[1] | In December 2013, we purchased 4.0 million shares at a price of $25.50 per share in a privately negotiated transaction with the "Peter B. Lewis Trust under Agreement dated December 21, 1994, as modified." Mr. Lewis was our non-executive Chairman of the Board until his death in November 2013. |
Consolidated_Statements_of_Cha1
Consolidated Statements of Changes in Shareholders' Equity (Parenthetical) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Number of shares acquired in a privately negotiated transaction | 4,000,000 | ' | ' |
Treasury Stock Acquired Cost per Share Privately Negotiated Transaction | $25.50 | ' | ' |
Retained Earnings | ' | ' | ' |
Cash dividends declared on common shares, per share | $1.49 | $1.28 | $0.41 |
Serial Preferred Stock | ' | ' | ' |
Preference Shares authorized | 20,000,000 | ' | ' |
Preference Shares issued | 0 | ' | ' |
Preferred Shares outstanding | 0 | ' | ' |
Voting Preferred Stock | ' | ' | ' |
Preference Shares authorized | 5,000,000 | ' | ' |
Preference Shares issued | 0 | ' | ' |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Cash Flows From Operating Activities | ' | ' | ' |
Net income | $1,165.40 | $902.30 | $1,015.50 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' |
Depreciation | 101.3 | 94.4 | 88.5 |
Amortization of fixed-income securities | 134 | 186.7 | 233 |
Amortization of equity-based compensation | 64.9 | 63.4 | 50.5 |
Net realized (gains) losses on securities | -318.4 | -306.8 | -102.6 |
Net (gains) losses on disposition of property and equipment | 5.6 | 7.1 | 8.7 |
(Gains) losses on extinguishment of debt | 4.3 | 1.8 | 0.1 |
Changes in: | ' | ' | ' |
Premiums receivable | -127.4 | -253.8 | -191.4 |
Reinsurance recoverables | -189.2 | -83 | -76.5 |
Prepaid reinsurance premiums | -8.6 | 3.5 | 18.3 |
Deferred acquisition costs | -13.1 | -0.9 | -16.4 |
Income taxes | 57.8 | 19.8 | 28.4 |
Unearned premiums | 244.8 | 351.1 | 225.6 |
Loss and loss adjustment expense reserves | 641.6 | 592.6 | 174.8 |
Accounts payable, accrued expenses, and other liabilities | 165 | 123.6 | 35.5 |
Other, net | -28.1 | -10.4 | 5.9 |
Net cash provided by operating activities | 1,899.90 | 1,691.40 | 1,497.90 |
Purchases: | ' | ' | ' |
Fixed maturities | -7,100.60 | -5,199.20 | -6,032.40 |
Equity securities | -322.2 | -463.1 | -582 |
Sales: | ' | ' | ' |
Fixed maturities | 3,083.90 | 3,705.60 | 4,442.60 |
Equity securities | 369.2 | 793 | 423.5 |
Maturities, paydowns, calls, and other: | ' | ' | ' |
Fixed maturities | 1,859.60 | 1,488.90 | 1,540.90 |
Equity securities | 21.5 | 16 | 0 |
Net sales (purchases) of short-term investments | 716.6 | -438.2 | -461 |
Net unsettled security transactions | 152.2 | -44 | -0.6 |
Purchases of property and equipment | -140.4 | -127.7 | -78.9 |
Sales of property and equipment | 3.7 | 3.8 | 3 |
Net cash provided by (used in) investing activities | -1,356.50 | -264.9 | -744.9 |
Cash Flows From Financing Activities | ' | ' | ' |
Proceeds from exercise of stock options | 0 | 0.5 | 22.4 |
Tax benefit from exercise/vesting of equity-based compensation | 10.3 | 5.8 | 6.4 |
Net proceeds from debt issuance | 0 | 0 | 491.9 |
Payment of debt | -150 | -350 | 0 |
Reacquisition of debt | -58.1 | -32.5 | -15 |
Dividends paid to shareholders | -175.6 | -853.7 | -263.6 |
Acquisition of treasury shares | -273.4 | -174.2 | -997.8 |
Net cash used in financing activities | -646.8 | -1,404.10 | -755.7 |
Effect of exchange rate changes on cash | -0.6 | 1 | -0.5 |
Increase (decrease) in cash | -104 | 23.4 | -3.2 |
Cash, Beginning of year | 179.1 | 155.7 | 158.9 |
Cash, End of year | $75.10 | $179.10 | $155.70 |
SCHEDULE_I_Summary_Of_Investme
SCHEDULE I - Summary Of Investments - Other Than Investments in Related Parties | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
SCHEDULE I - Summary Of Investments - Other Than Investments In Related Parties | ' | |||||||||||
SCHEDULE I — SUMMARY OF INVESTMENTS — OTHER THAN INVESTMENTS IN RELATED PARTIES | ||||||||||||
THE PROGRESSIVE CORPORATION AND SUBSIDIARIES | ||||||||||||
(millions) | ||||||||||||
December 31, 2013 | ||||||||||||
Type of Investment | Cost | Fair Value | Amount At | |||||||||
Which Shown | ||||||||||||
In The | ||||||||||||
Balance Sheet | ||||||||||||
Available-for-sale | ||||||||||||
Fixed maturities: | ||||||||||||
Bonds: | ||||||||||||
United States Government and government agencies and authorities | $ | 3,630.40 | $ | 3,662.20 | $ | 3,662.20 | ||||||
States, municipalities, and political subdivisions | 2,247.30 | 2,256.00 | 2,256.00 | |||||||||
Foreign government obligations | 15.6 | 15.6 | 15.6 | |||||||||
Public utilities | 96.3 | 100 | 100 | |||||||||
Corporate and other debt securities | 2,788.70 | 2,826.60 | 2,826.60 | |||||||||
Asset-backed securities | 4,337.50 | 4,366.10 | 4,366.10 | |||||||||
Redeemable preferred stocks | 299.5 | 313.9 | 313.9 | |||||||||
Total fixed maturities | 13,415.30 | 13,540.40 | 13,540.40 | |||||||||
Equity securities: | ||||||||||||
Common stocks: | ||||||||||||
Public utilities | 106.7 | 156.4 | 156.4 | |||||||||
Banks, trusts, and insurance companies | 208.1 | 332.4 | 332.4 | |||||||||
Industrial, miscellaneous, and all other | 1,136.30 | 2,041.70 | 2,041.70 | |||||||||
Nonredeemable preferred stocks | 445.7 | 711.2 | 711.2 | |||||||||
Total equity securities | 1,896.80 | 3,241.70 | 3,241.70 | |||||||||
Short-term investments1 | 1,272.60 | 1,272.60 | 1,272.60 | |||||||||
Total investments | $ | 16,584.70 | $ | 18,054.70 | $ | 18,054.70 | ||||||
1 Includes $6.3 million in treasury bills issued by the Australian government. | ||||||||||||
Progressive did not have any securities of any one issuer, excluding U.S. government obligations, with an aggregate cost or fair value exceeding 10% of total shareholders’ equity at December 31, 2013. |
SCHEDULE_II_Condensed_Financia
SCHEDULE II - Condensed Financial Information Of Registrant | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
SCHEDULE II - Condensed Financial Information Of Registrant | ' | |||||||||||
SCHEDULE II — CONDENSED FINANCIAL INFORMATION OF REGISTRANT | ||||||||||||
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME | ||||||||||||
THE PROGRESSIVE CORPORATION (PARENT COMPANY) | ||||||||||||
(millions) | ||||||||||||
Years Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Revenues | ||||||||||||
Dividends from subsidiaries | $ | 1,119.70 | $ | 782.3 | $ | 875.3 | ||||||
Undistributed income (loss) from subsidiaries | 117.5 | 193.1 | 225.7 | |||||||||
Equity in net income of subsidiaries* | 1,237.20 | 975.4 | 1,101.00 | |||||||||
Intercompany investment income* | 2.8 | 6.1 | 5.6 | |||||||||
Gains (losses) on extinguishment of debt | (4.3 | ) | (1.8 | ) | (.1 | ) | ||||||
Other income1 | 2.6 | 0 | 0 | |||||||||
Total revenues | 1,238.30 | 979.7 | 1,106.50 | |||||||||
Expenses | ||||||||||||
Interest expense | 121.2 | 126.3 | 138 | |||||||||
Deferred compensation2 | 9.5 | 5.5 | 0.4 | |||||||||
Other operating costs and expenses | 4 | 3.7 | 4.7 | |||||||||
Total expenses | 134.7 | 135.5 | 143.1 | |||||||||
Income before income taxes | 1,103.60 | 844.2 | 963.4 | |||||||||
Provision (benefit) for income taxes | (61.8 | ) | (58.1 | ) | (52.1 | ) | ||||||
Net income | $ | 1,165.40 | $ | 902.3 | $ | 1,015.50 | ||||||
Other comprehensive income (loss) | 80.7 | 178.5 | (91.2 | ) | ||||||||
Comprehensive income | $ | 1,246.10 | $ | 1,080.80 | $ | 924.3 | ||||||
* Eliminated in consolidation. | ||||||||||||
1 Represents gain on net death benefit received on life insurance policies. | ||||||||||||
2 See Note 4 – Employee Benefit Plans in these condensed financial statements. | ||||||||||||
See notes to condensed financial statements. | ||||||||||||
CONDENSED BALANCE SHEETS | ||||||||||||
THE PROGRESSIVE CORPORATION (PARENT COMPANY) | ||||||||||||
(millions) | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Assets | ||||||||||||
Investment in affiliate | $ | 5 | $ | 1 | ||||||||
Investment in subsidiaries* | 6,923.50 | 6,648.60 | ||||||||||
Receivable from investment subsidiary* | 1,648.40 | 1,322.90 | ||||||||||
Intercompany receivable* | 307.6 | 296.2 | ||||||||||
Net deferred income taxes | 69.1 | 48.3 | ||||||||||
Other assets | 141.8 | 82 | ||||||||||
Total Assets | $ | 9,095.40 | $ | 8,399.00 | ||||||||
Liabilities and Shareholders’ Equity | ||||||||||||
Accounts payable, accrued expenses, and other liabilities | $ | 154.8 | $ | 156.9 | ||||||||
Dividend payable | 890.2 | 172 | ||||||||||
Debt | 1,860.90 | 2,063.10 | ||||||||||
Total liabilities | 2,905.90 | 2,392.00 | ||||||||||
Common shares, $1.00 par value (authorized 900.0; issued 797.6 and 797.7, including treasury shares of 201.8 and 193.1) | 595.8 | 604.6 | ||||||||||
Paid-in capital | 1,142.00 | 1,077.00 | ||||||||||
Retained earnings | 3,500.00 | 3,454.40 | ||||||||||
Total accumulated other comprehensive income | 951.7 | 871 | ||||||||||
Total shareholders’ equity | 6,189.50 | 6,007.00 | ||||||||||
Total Liabilities and Shareholders’ Equity | $ | 9,095.40 | $ | 8,399.00 | ||||||||
*Eliminated in consolidation. | ||||||||||||
See notes to condensed financial statements. | ||||||||||||
CONDENSED STATEMENTS OF CASH FLOWS | ||||||||||||
THE PROGRESSIVE CORPORATION (PARENT COMPANY) | ||||||||||||
(millions) | ||||||||||||
Years Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Cash Flows From Operating Activities: | ||||||||||||
Net income | $ | 1,165.40 | $ | 902.3 | $ | 1,015.50 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
Undistributed (income) loss from subsidiaries | (117.5 | ) | (193.1 | ) | (225.7 | ) | ||||||
Amortization of equity-based compensation | 2.1 | 2 | 2.1 | |||||||||
(Gains) losses on extinguishment of debt | 4.3 | 1.8 | 0.1 | |||||||||
Changes in: | ||||||||||||
Intercompany receivable | (11.4 | ) | (58.6 | ) | (58.5 | ) | ||||||
Accounts payable, accrued expenses, and other liabilities | 19.4 | 0.3 | 4.5 | |||||||||
Income taxes | (55.8 | ) | 21.7 | (3.4 | ) | |||||||
Other, net | (16.3 | ) | (9.9 | ) | 4.2 | |||||||
Net cash provided by operating activities | 990.2 | 666.5 | 738.8 | |||||||||
Cash Flows From Investing Activities: | ||||||||||||
Additional investments in equity securities of consolidated subsidiaries | (13.9 | ) | (36.1 | ) | (11.8 | ) | ||||||
Investment in affiliate | (4.0 | ) | 0 | 0 | ||||||||
(Paid to) received from investment subsidiary | (325.5 | ) | 773.7 | 23.6 | ||||||||
Net cash provided by (used in) investing activities | (343.4 | ) | 737.6 | 11.8 | ||||||||
Cash Flows From Financing Activities: | ||||||||||||
Proceeds from exercise of stock options | 0 | 0.5 | 22.4 | |||||||||
Tax benefit from exercise/vesting of equity-based compensation | 10.3 | 5.8 | 6.4 | |||||||||
Net proceeds from debt issuance | 0 | 0 | 497 | |||||||||
Payment of debt | (150.0 | ) | (350.0 | ) | 0 | |||||||
Reacquisition of debt | (58.1 | ) | (32.5 | ) | (15.0 | ) | ||||||
Dividends paid to shareholders | (175.6 | ) | (853.7 | ) | (263.6 | ) | ||||||
Acquisition of treasury shares | (273.4 | ) | (174.2 | ) | (997.8 | ) | ||||||
Net cash used in financing activities | (646.8 | ) | (1,404.1 | ) | (750.6 | ) | ||||||
Change in cash | 0 | 0 | 0 | |||||||||
Cash, beginning of year | 0 | 0 | 0 | |||||||||
Cash, end of year | $ | 0 | $ | 0 | $ | 0 | ||||||
See notes to condensed financial statements. | ||||||||||||
NOTES TO CONDENSED FINANCIAL STATEMENTS | ||||||||||||
The accompanying condensed financial statements of The Progressive Corporation (parent company) should be read in conjunction with the consolidated financial statements and notes thereto in The Annual Report to Shareholders of the Progressive Corporation and its subsidiaries’, which is included as Exhibit 13 to this Form 10-K. | ||||||||||||
Note 1. Statements of Cash Flows — For the purpose of the Statements of Cash Flows, cash includes only bank demand deposits. The Progressive Corporation does not hold any cash but has unrestricted access to funds maintained in a non-insurance, investment subsidiary to meet its holding company obligations; at year-end 2013 and 2012, $1.8 billion and $1.4 billion, respectively, of marketable securities were available in this company. Non-cash activity includes declared but unpaid dividends. For the years ended December 31, we paid the following: | ||||||||||||
(millions) | 2013 | 2012 | 2011 | |||||||||
Income taxes | $ | 497 | $ | 389.1 | $ | 435 | ||||||
Interest | 122.3 | 135 | 129.5 | |||||||||
Note 2. Income Taxes — The Progressive Corporation files a consolidated federal income tax return with all subsidiaries and acts as an agent for the consolidated tax group when making payments to the Internal Revenue Service. The consolidated group’s net income taxes currently payable/recoverable are included in other liabilities/assets, respectively, in the accompanying Condensed Balance Sheets based on the balance at the end of the year. The Progressive Corporation and its subsidiaries have adopted, pursuant to a written agreement, a method of allocating consolidated federal income taxes. Amounts allocated to the subsidiaries under the written agreement are included in “Intercompany Receivable” in the accompanying Condensed Balance Sheets. | ||||||||||||
Note 3. Debt — The information relating to debt is incorporated by reference from Note 4 – Debt in our Annual Report, which is included as Exhibit 13 to this Form 10-K. | ||||||||||||
Note 4. Employee Benefit Plans — The information relating to incentive compensation plans and deferred compensation is incorporated by reference from Note 9 – Employee Benefit Plans in our Annual Report, which is included as Exhibit 13 to this Form 10-K. | ||||||||||||
Note 5. Other Comprehensive Income — On the condensed Statements of Comprehensive Income, other comprehensive income (loss) represents activity of the subsidiaries of The Progressive Corporation and includes net unrealized gains (losses) on securities, net unrealized gains on forecasted transactions, and foreign currency translation adjustments. | ||||||||||||
Note 6. Dividends — The information relating to our dividend policy is incorporated by reference from Note 14 – Dividends in our Annual Report, which is included as Exhibit 13 to this Form 10-K. |
SCHEDULE_III_Supplementary_Ins
SCHEDULE III - Supplementary Insurance Information | 12 Months Ended | |||||||||||||||||||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||||||||||||||||||
SCHEDULE III - Supplementary Insurance Information | ' | |||||||||||||||||||||||||||||||||||||||
SCHEDULE III — SUPPLEMENTARY INSURANCE INFORMATION | ||||||||||||||||||||||||||||||||||||||||
THE PROGRESSIVE CORPORATION AND SUBSIDIARIES | ||||||||||||||||||||||||||||||||||||||||
(millions) | ||||||||||||||||||||||||||||||||||||||||
Segment | Deferred | Future | Unearned premiums1 | Other | Premium revenue | Net | Benefits, | Amortization | Other | Net | ||||||||||||||||||||||||||||||
policy | policy | policy | investment income1,2 | claims, | of deferred | operating expenses | premiums | |||||||||||||||||||||||||||||||||
acquisition costs1 | benefits, | claims | losses, and | policy | written | |||||||||||||||||||||||||||||||||||
losses, | and | settlement expenses | acquisition costs | |||||||||||||||||||||||||||||||||||||
claims, | benefits payable1 | |||||||||||||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||||||||||||||
loss expenses1 | ||||||||||||||||||||||||||||||||||||||||
Year ended December 31, 2013: | ||||||||||||||||||||||||||||||||||||||||
Personal Lines | $ | 15,341.60 | $ | 11,194.60 | $ | 1,257.50 | $ | 2,149.20 | $ | 15,569.20 | ||||||||||||||||||||||||||||||
Commercial Lines | 1,761.60 | 1,267.30 | 194.3 | 201.2 | 1,770.50 | |||||||||||||||||||||||||||||||||||
Other indemnity | 0.2 | 10.5 | 0 | 0.5 | 0 | |||||||||||||||||||||||||||||||||||
Total | $ | 447.6 | $ | 8,479.70 | $ | 5,174.50 | $ | 0 | $ | 17,103.40 | $ | 403.2 | $ | 12,472.40 | $ | 1,451.80 | $ | 2,350.90 | $ | 17,339.70 | ||||||||||||||||||||
Year ended December 31, 2012: | ||||||||||||||||||||||||||||||||||||||||
Personal Lines | $ | 14,368.10 | $ | 10,745.30 | $ | 1,250.40 | $ | 2,010.50 | $ | 14,636.80 | ||||||||||||||||||||||||||||||
Commercial Lines | 1,649.00 | 1,196.60 | 186.2 | 195.2 | 1,735.90 | |||||||||||||||||||||||||||||||||||
Other indemnity | 0.9 | 6.1 | 0 | 0.6 | 0 | |||||||||||||||||||||||||||||||||||
Total | $ | 434.5 | $ | 7,838.40 | $ | 4,930.70 | $ | 0 | $ | 16,018.00 | $ | 427.6 | $ | 11,948.00 | $ | 1,436.60 | $ | 2,206.30 | $ | 16,372.70 | ||||||||||||||||||||
Year ended December 31, 2011: | ||||||||||||||||||||||||||||||||||||||||
Personal Lines | $ | 13,431.10 | $ | 9,615.20 | $ | 1,231.90 | $ | 1,915.60 | $ | 13,612.20 | ||||||||||||||||||||||||||||||
Commercial Lines | 1,467.10 | 1,010.70 | 166.6 | 171.9 | 1,534.30 | |||||||||||||||||||||||||||||||||||
Other indemnity | 4.6 | 8.9 | 0.7 | 0.5 | 0.1 | |||||||||||||||||||||||||||||||||||
Total | $ | 433.6 | $ | 7,245.80 | $ | 4,579.40 | $ | 0 | $ | 14,902.80 | $ | 466.5 | $ | 10,634.80 | $ | 1,399.20 | $ | 2,088.00 | $ | 15,146.60 | ||||||||||||||||||||
1 Progressive does not allocate assets, liabilities, or investment income to operating segments. | ||||||||||||||||||||||||||||||||||||||||
2 Excludes total net realized gains (losses) on securities. |
SCHEDULE_IV_Reinsurance
SCHEDULE IV - Reinsurance | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||
SCHEDULE IV - Reinsurance | ' | ||||||||||||||||||
SCHEDULE IV — REINSURANCE | |||||||||||||||||||
THE PROGRESSIVE CORPORATION AND SUBSIDIARIES | |||||||||||||||||||
(millions) | |||||||||||||||||||
Year Ended: | Gross Amount | Ceded to | Assumed | Net Amount | Percentage | ||||||||||||||
Other Companies | From | of Amount | |||||||||||||||||
Other Companies | Assumed to Net | ||||||||||||||||||
31-Dec-13 | |||||||||||||||||||
Premiums earned: | |||||||||||||||||||
Property and liability insurance | $ | 17,317.90 | $ | 214.5 | $ | 0 | $ | 17,103.40 | 0 | ||||||||||
31-Dec-12 | |||||||||||||||||||
Premiums earned: | |||||||||||||||||||
Property and liability insurance | $ | 16,207.60 | $ | 189.6 | $ | 0 | $ | 16,018.00 | 0 | ||||||||||
31-Dec-11 | |||||||||||||||||||
Premiums earned: | |||||||||||||||||||
Property and liability insurance | $ | 15,107.50 | $ | 204.7 | $ | 0 | $ | 14,902.80 | 0 | ||||||||||
SCHEDULE_VISupplemental_Inform
SCHEDULE VI-Supplemental Information Concerning Property - Casualty Insurance Operations | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
SCHEDULE VI-Supplemental Information Concerning Property - Casualty Insurance Operations | ' | |||||||||||
SCHEDULE VI — SUPPLEMENTAL INFORMATION CONCERNING PROPERTY - CASUALTY INSURANCE OPERATIONS | ||||||||||||
THE PROGRESSIVE CORPORATION AND SUBSIDIARIES | ||||||||||||
(millions) | ||||||||||||
Losses and Loss Adjustment | ||||||||||||
Expenses Incurred Related to | ||||||||||||
Year Ended | Current Year | Prior Years | Paid Losses and Loss | |||||||||
Adjustment Expenses | ||||||||||||
31-Dec-13 | $ | 12,427.30 | $ | 45.1 | $ | 12,014.90 | ||||||
31-Dec-12 | $ | 11,926.00 | $ | 22 | $ | 11,431.80 | ||||||
31-Dec-11 | $ | 10,876.80 | $ | (242.0 | ) | $ | 10,541.60 | |||||
Pursuant to Rule 12-18 of Regulation S-X. See Schedule III for the additional information required in Schedule VI. |
Reporting_And_Accounting_Polic
Reporting And Accounting Policies | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Reporting And Accounting Policies | ' | |||||||||
REPORTING AND ACCOUNTING POLICIES | ||||||||||
Nature of Operations The Progressive Corporation, an insurance holding company formed in 1965, had 54 subsidiaries, 1 mutual insurance company affiliate, and 1 limited partnership investment affiliate (collectively the “subsidiaries”) as of December 31, 2013. Our insurance subsidiaries and mutual company affiliate (the Progressive Group of Insurance Companies) provide personal and commercial automobile insurance and other specialty property-casualty insurance and related services. Our Personal Lines segment writes insurance for personal autos and recreational vehicles through both an independent insurance agency channel and a direct channel. Our Commercial Lines segment writes primary liability and physical damage insurance for automobiles and trucks owned and/or operated predominantly by small businesses through both the independent agency and direct channels. We operate our businesses throughout the United States; we also sell personal auto physical damage insurance via the Internet in Australia. | ||||||||||
Basis of Consolidation and Reporting The accompanying consolidated financial statements include the accounts of The Progressive Corporation, its subsidiaries, which are wholly owned, and affiliates, in which we have a controlling financial interest. All intercompany accounts and transactions are eliminated in consolidation. | ||||||||||
Estimates We are required to make estimates and assumptions when preparing our financial statements and accompanying notes in conformity with accounting principles generally accepted in the United States of America (GAAP). As estimates develop into fact (e.g., losses are paid), results may, and will likely, differ from those estimates. | ||||||||||
Investments Progressive’s fixed-maturity securities, equity securities, and short-term investments are accounted for on an available-for-sale basis. See Note 2 – Investments for details regarding the composition of our investment portfolio. | ||||||||||
Fixed-maturity securities include debt securities and redeemable preferred stocks, which may have fixed or variable principal payment schedules, may be held for indefinite periods of time, and may be used as a part of our asset/liability strategy or sold in response to changes in interest rates, anticipated prepayments, risk/reward characteristics, liquidity needs, or other economic factors. These securities are carried at fair value with the corresponding unrealized gains (losses), net of deferred income taxes, reported in accumulated other comprehensive income. Fair values are obtained from recognized pricing services or are quoted by market makers and dealers, with limited exceptions discussed in Note 3 – Fair Value. | ||||||||||
Included in the fixed-maturity portfolio are asset-backed securities. The asset-backed securities are generally accounted for under the retrospective method. The retrospective method recalculates yield assumptions (based on changes in interest rates or cash flow expectations) historically to the inception of the investment holding period, and applies the required adjustment, if any, to the cost basis, with the offset recorded to investment income. The prospective method is used primarily for interest-only securities, non-investment-grade asset-backed securities, and certain asset-backed securities with sub-prime loan exposure or where there is a greater risk of non-performance and where it is possible the initial investment may not be substantially recovered. The prospective method requires a calculation of future expected repayments and resets the yield to allow for future period adjustments; no current period impact to investment income or the security’s cost is made based on the cash flow update. Prepayment assumptions are based on market expectations and are updated quarterly. | ||||||||||
Equity securities include common stocks, nonredeemable preferred stocks, and other risk investments and are reported at fair values. Changes in fair value of these securities, net of deferred income taxes, are reflected as unrealized gains (losses) in accumulated other comprehensive income. To the extent we hold any foreign equities or foreign currency hedges, any change in value due to exchange rate fluctuations would be limited by foreign currency hedges, if any, and would be recognized in income in the current period. | ||||||||||
Short-term investments may include Eurodollar deposits, commercial paper, repurchase transactions, and other securities expected to mature within one year. In addition, short-term investments can include auction rate securities (i.e., certain municipal bonds and preferred stocks). Due to the nature of auction rate securities, these securities are classified as short-term based upon their expected auction date (generally 7-49 days) rather than on their contractual maturity date (which is greater than one year at original issuance). In the event that an auction fails, the security may need to be reclassified from short-term. Changes in fair value of these securities, net of deferred income taxes, are reflected as unrealized gains (losses) in accumulated other comprehensive income. | ||||||||||
Trading securities are securities bought principally for the purpose of sale in the near term. To the extent we have trading securities, changes in fair value would be recognized in income in the current period. Derivative instruments, which may be used for trading purposes or classified as trading derivatives due to the characteristics of the transaction, are discussed below. | ||||||||||
Derivative instruments may include futures, options, forward positions, foreign currency forwards, interest rate swap agreements, and credit default swaps and may be used in the portfolio for general investment purposes or to hedge the exposure to: | ||||||||||
• | Changes in fair value of an asset or liability (fair value hedge) | |||||||||
• | Foreign currency of an investment in a foreign operation (foreign currency hedge), or | |||||||||
• | Variable cash flows of a forecasted transaction (cash flow hedge). | |||||||||
To the extent we have derivatives held for general investment purposes, these derivative instruments are recognized as either assets or liabilities and measured at fair value, with changes in fair value recognized in income as a component of net realized gains (losses) on securities during the period of change. | ||||||||||
Derivatives designated as hedges are required to be evaluated on established criteria to determine the effectiveness of their correlation to, and ability to reduce the designated risk of, specific securities or transactions. Effectiveness is required to be reassessed regularly. Hedges that are deemed to be effective would be accounted for as follows: | ||||||||||
• | Fair value hedge: changes in fair value of the hedge, as well as the hedged item, would be recognized in income in the period of change while the hedge is in effect. | |||||||||
• | Foreign currency hedge: changes in fair value of the hedge, as well as the hedged item, would be reflected as a change in translation adjustment as part of accumulated other comprehensive income. Gains and losses on the foreign currency hedge would offset the foreign exchange gains and losses on the foreign investment as they are recognized into income. | |||||||||
• | Cash flow hedge: changes in fair value of the hedge would be reported as a component of accumulated other comprehensive income and subsequently amortized into earnings over the life of the hedged transaction. | |||||||||
If a hedge is deemed to become ineffective or discontinued, the following accounting treatment would be applied: | ||||||||||
• | Fair value hedge: the derivative instrument would continue to be adjusted through income, while the adjustment in the change in value of the hedged item would be reflected as a change in unrealized gains (losses) as part of accumulated other comprehensive income. | |||||||||
• | Foreign currency hedge: changes in the value of the hedged item would continue to be reflected as a change in translation adjustment as part of accumulated other comprehensive income, but the derivative instrument would be adjusted through income for the current period. | |||||||||
• | Cash flow hedge: changes in fair value of the derivative instrument would be reported in income for the current period. | |||||||||
For all derivative positions, net cash requirements are limited to changes in fair values, which may vary based upon changes in interest rates, currency exchange rates, and other factors. Exposure to credit risk is limited to the carrying value; collateral may be required to limit credit risk. We have elected not to offset fair value amounts that arise from derivative positions with the same counterparty under a master netting arrangement. | ||||||||||
Investment securities are exposed to various risks such as interest rate, market, credit, and liquidity risk. Fair values of securities fluctuate based on the nature and magnitude of changing market conditions; significant changes in market conditions could materially affect the portfolio’s value in the near term. We regularly monitor our portfolio for price changes, which might indicate potential impairments, and perform detailed reviews of securities with unrealized losses. In such cases, changes in fair value are evaluated to determine the extent to which such changes are attributable to: (i) fundamental factors specific to the issuer, such as financial condition, business prospects, or other factors, (ii) market-related factors, such as interest rates or equity market declines, or (iii) credit-related losses, where the present value of cash flows expected to be collected are lower than the amortized cost basis of the security. | ||||||||||
We analyze our debt securities that are in a loss position to determine if we intend to sell, or if it is more likely than not that we will be required to sell, the security prior to recovery and, if so, we write down the security to its current fair value, with the entire amount of the write-down recorded to earnings. To the extent that it is more likely than not that we will hold the debt security until recovery (which could be maturity), we determine if any of the decline in value is due to a credit loss (i.e., where the present value of future cash flows expected to be collected is lower than the amortized cost basis of the security) and, if so, we recognize that portion of the impairment as a component of net realized gains (losses) in the comprehensive income statement, with the difference (i.e., non-credit related impairment) recognized as part of our net unrealized gains (losses) in accumulated other comprehensive income. When an equity security (common equity and nonredeemable preferred stock) in our investment portfolio has an unrealized loss in fair value that is deemed to be other-than-temporary, we reduce the book value of such security to its current fair value, recognizing the decline as a realized loss in the comprehensive income statement. Any future changes in fair value, either increases or decreases, are reflected as changes in unrealized gains (losses) as part of accumulated other comprehensive income. | ||||||||||
Investment income consists of interest and dividends. In addition to the discussion above for asset-backed securities, interest is recognized on an accrual basis using the effective yield method. Depending on the nature of the equity instruments, dividends are recorded at either the ex-dividend date or on an accrual basis. | ||||||||||
Realized gains (losses) on securities are computed based on the first-in first-out method and include write-downs on available-for-sale securities considered to have other-than-temporary declines in fair value (excluding non-credit related impairments), as well as holding period valuation changes on derivatives, trading securities, and hybrid instruments (e.g., securities with embedded options, where the option is a feature of the overall change in the value of the instrument). | ||||||||||
Insurance Premiums and Receivables Insurance premiums written are earned into income on a pro rata basis over the period of risk, based on a daily earnings convention. Accordingly, unearned premiums represent the portion of premiums written that are applicable to the unexpired risk. We provide insurance and related services to individuals and small commercial accounts and offer a variety of payment plans. Generally, premiums are collected prior to providing risk coverage, minimizing our exposure to credit risk. We perform a policy level evaluation to determine the extent to which the premiums receivable balance exceeds the unearned premiums balance. We then age this exposure to establish an allowance for doubtful accounts based on prior experience. | ||||||||||
Deferred Acquisition Costs Deferred acquisition costs include commissions, premium taxes, and other variable underwriting and direct sales costs incurred in connection with the successful acquisition or renewal of insurance contracts. These acquisition costs are deferred and amortized over the policy period in which the related premiums are earned. We consider anticipated investment income in determining the recoverability of these costs. Management believes that these costs will be fully recoverable in the near term. | ||||||||||
We do not defer any advertising costs. Total advertising costs, which are expensed as incurred, for the years ended December 31, were: | ||||||||||
(millions) | Advertising Costs | |||||||||
2013 | $ | 619.3 | ||||||||
2012 | 546.8 | |||||||||
2011 | 543 | |||||||||
Loss and Loss Adjustment Expense Reserves Loss reserves represent the estimated liability on claims reported to us, plus reserves for losses incurred but not recorded (IBNR). These estimates are reported net of amounts estimated to be recoverable from salvage and subrogation. Loss adjustment expense reserves represent the estimated expenses required to settle these claims and losses. The methods of making estimates and establishing these reserves are reviewed regularly, and resulting adjustments are reflected in income currently. Such loss and loss adjustment expense reserves are susceptible to change in the near term. | ||||||||||
Reinsurance Our reinsurance transactions primarily include premiums ceded to state-provided reinsurance facilities (e.g., Michigan Catastrophic Claims Association and North Carolina Reinsurance Facility) and premiums written under state-mandated involuntary plans for commercial vehicles (Commercial Auto Insurance Procedures/Plans – “CAIP”). Prepaid reinsurance premiums are earned on a pro rata basis over the period of risk, based on a daily earnings convention, which is consistent with premiums written. See Note 7 – Reinsurance for further discussion. | ||||||||||
Income Taxes The income tax provision is calculated under the balance sheet approach. Deferred tax assets and liabilities are recorded based on the difference between the financial statement and tax bases of assets and liabilities at the enacted tax rates. The principal items giving rise to such differences are investment securities (e.g., net unrealized gains (losses), write-downs on securities determined to be other-than-temporarily impaired, and derivative instruments), loss and loss adjustment expense reserves, unearned premiums reserves, deferred acquisition costs, property and equipment, and non-deductible accruals. We review our deferred tax assets regularly for recoverability. See Note 5 – Income Taxes for further discussion. | ||||||||||
Property and Equipment Property and equipment are recorded at cost, less accumulated depreciation, and include capitalized software developed or acquired for internal use. Depreciation is recognized over the estimated useful lives of the assets using accelerated methods for most computer equipment and the straight-line method for certain computer equipment and all other fixed assets. The useful lives range from 2 to 3 years for computer equipment and laptop computers; 7 to 40 years for buildings, improvements, and integrated components; and 3 to 10 years for all other property and equipment. Land and buildings comprised 76% and 75% of total property and equipment at December 31, 2013 and 2012, respectively. | ||||||||||
Total capitalized interest, which primarily relates to capitalized software projects, for the years ended December 31, was: | ||||||||||
(millions) | Capitalized | |||||||||
Interest | ||||||||||
2013 | $ | 0.8 | ||||||||
2012 | 0.3 | |||||||||
2011 | 0.4 | |||||||||
Guaranty Fund Assessments We are subject to state guaranty fund assessments, which provide for the payment of covered claims or other insurance obligations of insurance companies deemed insolvent. These assessments are accrued after a formal determination of insolvency has occurred, and we have written the premiums on which the assessments will be based. | ||||||||||
Fees and Other Revenues Fees and other revenues primarily represent fees collected from policyholders relating to installment charges in accordance with our bill plans, as well as late payment and insufficient funds fees. Other revenues may include revenue from the sale of tax credits, rental income, and other revenue transactions. | ||||||||||
Service Revenues and Expenses Our service businesses provide insurance-related services. Service revenues generated from processing business for involuntary CAIP plans are earned on a pro rata basis over the term of the related policies. Service expenses related to these CAIP plans include acquisition expenses, which are deferred and amortized over the period in which the related revenues are earned. Other service business revenues and expenses are recorded in the period in which they are earned or incurred. | ||||||||||
Equity-Based Compensation We currently issue time-based and performance-based restricted stock unit awards to key members of management as our form of equity compensation, and time-based restricted stock awards to non-employee directors. Prior to 2010, we issued restricted stock awards, instead of restricted stock unit awards, to employees. Collectively, we refer to these awards as “restricted equity awards.” We currently do not issue stock options as a form of equity compensation. Compensation expense for time-based restricted equity awards with installment vesting is recognized over each respective vesting period. For performance-based restricted equity awards, compensation expense is recognized over the respective estimated vesting periods. | ||||||||||
We record an estimate for expected forfeitures of restricted equity awards based on our historical forfeiture rates. In addition, we shorten the vesting periods of certain restricted equity awards based on the “qualified retirement” provisions in our incentive compensation plans, under which (among other provisions) the vesting of 50% of outstanding time-based restricted equity awards will accelerate upon retirement if the participant is 55 years of age or older and satisfies certain years-of-service requirements. We modified our "qualified retirement" provisions for awards granted after February 2013 to vest and distribute 50% of the unvested portion of the award upon reaching eligibility for a qualified retirement and, thereafter, shortly after the grant date. | ||||||||||
The total compensation expense recognized for our equity-based compensation for the years ended December 31, was: | ||||||||||
(millions) | 2013 | 2012 | 2011 | |||||||
Pretax expense | $ | 64.9 | $ | 63.4 | $ | 50.5 | ||||
Tax benefit | 22.7 | 22.2 | 17.7 | |||||||
Net Income Per Share Basic net income per share is computed using the weighted average number of common shares outstanding during the reporting period, excluding unvested time-based and performance-based restricted equity awards that are subject to forfeiture. Diluted net income per share includes common stock equivalents assumed outstanding during the period. Our common stock equivalents include the incremental shares assumed to be issued for: | ||||||||||
• | outstanding stock options (all remaining stock options were exercised in 2012) | |||||||||
• | unvested time-based restricted equity awards, and | |||||||||
• | certain unvested performance-based restricted equity awards that satisfied contingency conditions for common stock equivalents during the period. | |||||||||
Supplemental Cash Flow Information Cash includes only bank demand deposits. Non-cash activity includes declared but unpaid dividends. For the years ended December 31, we paid the following: | ||||||||||
(millions) | 2013 | 2012 | 2011 | |||||||
Income taxes | $ | 497 | $ | 389.1 | $ | 435 | ||||
Interest | 122.3 | 135 | 129.5 | |||||||
Reclassification For the period ended December 31, 2012, we reclassified dividends payable out of "accounts payable, accrued expenses, and other liabilities" to be reported as a separate line item to conform with the current-year presentation. There was no effect on total liabilities. |
Investments
Investments | 12 Months Ended | ||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||
Investments | ' | ||||||||||||||||||||||||||
INVESTMENTS | |||||||||||||||||||||||||||
The following tables present the composition of our investment portfolio by major security type, consistent with our internal classification of how we manage, monitor, and measure the portfolio: | |||||||||||||||||||||||||||
($ in millions) | Cost | Gross Unrealized Gains | Gross Unrealized Losses | Net Realized Gains (Losses)1 | Fair Value | % of Total Fair Value | |||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | $ | 3,630.40 | $ | 48.4 | $ | (16.6 | ) | $ | 0 | $ | 3,662.20 | 20.3 | % | ||||||||||||||
State and local government obligations | 2,247.30 | 27.1 | (18.4 | ) | 0 | 2,256.00 | 12.5 | ||||||||||||||||||||
Foreign government obligations | 15.6 | 0 | 0 | 0 | 15.6 | 0.1 | |||||||||||||||||||||
Corporate debt securities | 2,885.00 | 60.4 | (20.4 | ) | 1.6 | 2,926.60 | 16.2 | ||||||||||||||||||||
Residential mortgage-backed securities | 1,110.10 | 31.9 | (14.1 | ) | 0 | 1,127.90 | 6.2 | ||||||||||||||||||||
Commercial mortgage-backed securities | 2,154.40 | 43.9 | (37.8 | ) | 0 | 2,160.50 | 12 | ||||||||||||||||||||
Other asset-backed securities | 1,073.00 | 6.6 | (2.1 | ) | 0.2 | 1,077.70 | 6 | ||||||||||||||||||||
Redeemable preferred stocks | 299.5 | 24.1 | (9.7 | ) | 0 | 313.9 | 1.7 | ||||||||||||||||||||
Total fixed maturities | 13,415.30 | 242.4 | (119.1 | ) | 1.8 | 13,540.40 | 75 | ||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 445.7 | 258.7 | (4.5 | ) | 11.3 | 711.2 | 3.9 | ||||||||||||||||||||
Common equities | 1,451.10 | 1,081.80 | (2.4 | ) | 0 | 2,530.50 | 14 | ||||||||||||||||||||
Short-term investments: | |||||||||||||||||||||||||||
Other short-term investments | 1,272.60 | 0 | 0 | 0 | 1,272.60 | 7.1 | |||||||||||||||||||||
Total portfolio2,3 | $ | 16,584.70 | $ | 1,582.90 | $ | (126.0 | ) | $ | 13.1 | $ | 18,054.70 | 100 | % | ||||||||||||||
($ in millions) | Cost | Gross Unrealized Gains | Gross Unrealized Losses | Net Realized Gains (Losses)1 | Fair Value | % of Total Fair Value | |||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | $ | 2,806.40 | $ | 90.1 | $ | 0 | $ | 0 | $ | 2,896.50 | 17.6 | % | |||||||||||||||
State and local government obligations | 1,914.40 | 50.6 | (.6 | ) | 0 | 1,964.40 | 11.9 | ||||||||||||||||||||
Foreign government obligations | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
Corporate debt securities | 2,982.90 | 124.7 | (1.0 | ) | 6.4 | 3,113.00 | 18.9 | ||||||||||||||||||||
Residential mortgage-backed securities | 413.4 | 24 | (9.2 | ) | 0 | 428.2 | 2.6 | ||||||||||||||||||||
Commercial mortgage-backed securities | 1,963.90 | 84.9 | (.1 | ) | 0 | 2,048.70 | 12.4 | ||||||||||||||||||||
Other asset-backed securities | 936 | 12.9 | (.1 | ) | (.2 | ) | 948.6 | 5.8 | |||||||||||||||||||
Redeemable preferred stocks | 356.9 | 30.5 | (12.7 | ) | 0 | 374.7 | 2.3 | ||||||||||||||||||||
Total fixed maturities | 11,373.90 | 417.7 | (23.7 | ) | 6.2 | 11,774.10 | 71.5 | ||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 404 | 404.6 | 0 | 3.8 | 812.4 | 4.9 | |||||||||||||||||||||
Common equities | 1,370.30 | 539 | (10.3 | ) | 0 | 1,899.00 | 11.5 | ||||||||||||||||||||
Short-term investments: | |||||||||||||||||||||||||||
Other short-term investments | 1,990.00 | 0 | 0 | 0 | 1,990.00 | 12.1 | |||||||||||||||||||||
Total portfolio2,3 | $ | 15,138.20 | $ | 1,361.30 | $ | (34.0 | ) | $ | 10 | $ | 16,475.50 | 100 | % | ||||||||||||||
1 Represents net holding period gains (losses) on certain hybrid securities (discussed below). | |||||||||||||||||||||||||||
2 Reflected in our total portfolio are unsettled security transactions and collateral on open derivative positions, which collectively reflect a liability of $61.3 million at December 31, 2013, compared to an asset of $90.9 million at December 31, 2012. | |||||||||||||||||||||||||||
3 The total fair value of the portfolio included $1.8 billion and $1.4 billion at December 31, 2013 and 2012, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of any unsettled security transactions. | |||||||||||||||||||||||||||
Our other short-term investments include commercial paper, reverse repurchase transactions, and other investments that are expected to mature within one year. At December 31, 2013 and 2012, we had $6.3 million and $21.9 million, respectively, in treasury bills issued by the Australian government, included in other short-term investments. We had $200.0 million and $581.0 million of open reverse repurchase commitments at December 31, 2013 and 2012, respectively. At these dates, we did not hold any repurchase transactions where we lent collateral. To the extent our repurchase transactions were with the same counterparty and subject to an enforceable master netting arrangement, we could elect to offset these transactions. Consistent with past practice, we report these transactions on a gross basis on our balance sheets. | |||||||||||||||||||||||||||
Included in our fixed-maturity and equity securities are hybrid securities, which are reported at fair value at December 31: | |||||||||||||||||||||||||||
(millions) | 2013 | 2012 | |||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
Corporate debt securities | $ | 164.2 | $ | 176.1 | |||||||||||||||||||||||
Other asset-backed securities | 14.8 | 16.4 | |||||||||||||||||||||||||
Total fixed maturities | 179 | 192.5 | |||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 60.3 | 52.8 | |||||||||||||||||||||||||
Total hybrid securities | $ | 239.3 | $ | 245.3 | |||||||||||||||||||||||
Certain corporate debt securities are accounted for as hybrid securities since they were acquired at a substantial premium and contain a change-in-control put option (derivative) that permits the investor, at its sole option if and when a change in control is triggered, to put the security back to the issuer at a 1% premium to par. Due to this change-in-control put option and the substantial market premium paid to acquire these securities, there is the potential that the election to put, upon the change in control, could result in an acceleration of the remaining premium paid on these securities, which would result in a loss of $11.1 million as of December 31, 2013, if all of the bonds experienced a simultaneous change in control and we elected to exercise all of our put options. The put feature limits the potential loss in value that could be experienced in the event a corporate action occurs that results in a change in control that materially diminishes the credit quality of the issuer. We are under no obligation to exercise the put option we hold if a change in control occurs. | |||||||||||||||||||||||||||
The other asset-backed security in the table above represents one hybrid security that was acquired at a deep discount to par due to a failing auction, and contains a put option that allows the investor to put that security back to the auction at par if the auction is restored. This embedded derivative has the potential to more than double our initial investment yield. | |||||||||||||||||||||||||||
The hybrid securities in our nonredeemable preferred stock portfolio are perpetual preferred stocks that have call features with fixed-rate coupons, whereby the change in value of the call features is a component of the overall change in value of the preferred stocks. | |||||||||||||||||||||||||||
Our securities are reported at fair value, with the changes in fair value of these securities (other than hybrid securities and derivative instruments) reported as a component of accumulated other comprehensive income, net of deferred income taxes. The changes in fair value of the hybrid securities and derivative instruments are recorded as a component of net realized gains (losses) on securities. | |||||||||||||||||||||||||||
At December 31, 2013, bonds and certificates of deposit in the principal amount of $153.2 million were on deposit to meet state insurance regulatory and/or rating agency requirements. We did not have any securities of any one issuer, excluding U.S. government obligations, with an aggregate cost or fair value exceeding 10% of total shareholders’ equity at December 31, 2013 or 2012. At December 31, 2013, we did not have any debt securities that were non-income producing during the preceding 12 months. | |||||||||||||||||||||||||||
Fixed Maturities The composition of fixed maturities by maturity at December 31, 2013, was: | |||||||||||||||||||||||||||
(millions) | Cost | Fair Value | |||||||||||||||||||||||||
Less than one year | $ | 1,829.30 | $ | 1,857.60 | |||||||||||||||||||||||
One to five years | 8,554.80 | 8,693.60 | |||||||||||||||||||||||||
Five to ten years | 2,860.50 | 2,812.10 | |||||||||||||||||||||||||
Ten years or greater | 102.6 | 109 | |||||||||||||||||||||||||
Total1 | $ | 13,347.20 | $ | 13,472.30 | |||||||||||||||||||||||
1 Excludes $68.1 million related to our open interest rate swap positions. | |||||||||||||||||||||||||||
Asset-backed securities are classified in the maturity distribution table based upon their projected cash flows. All other securities which do not have a single maturity date are reported based upon expected average maturity. Contractual maturities may differ from expected maturities because the issuers of the securities may have the right to call or prepay obligations. | |||||||||||||||||||||||||||
Gross Unrealized Losses As of December 31, 2013, we had $123.6 million of gross unrealized losses in our fixed-income securities (i.e., fixed-maturity securities, nonredeemable preferred stocks, and short-term investments) and $2.4 million in our common equities. We currently do not intend to sell the fixed-income securities and determined that it is more likely than not that we will not be required to sell these securities for the period of time necessary to recover their cost bases. A review of our fixed-income securities indicated that the issuers were current with respect to their interest obligations and that there was no evidence of any deterioration of the current cash flow projections that would indicate we would not receive the remaining principal at maturity. In addition, 89% of our common stock portfolio was indexed to the Russell 1000; as such, this portfolio may contain securities in a loss position for an extended period of time, subject to possible write-downs, as described below. We may retain these securities as long as the portfolio and index correlation remain similar. To the extent there is issuer-specific deterioration, we may write-down the securities of that issuer. The remaining 11% of our common stocks are part of a managed equity strategy selected and administered by external investment advisors. If our strategy were to change and these securities were determined to be other-than-temporarily impaired, we would recognize a write-down in accordance with our stated policy. | |||||||||||||||||||||||||||
The following tables show the composition of gross unrealized losses by major security type and by the length of time that individual securities have been in a continuous unrealized loss position: | |||||||||||||||||||||||||||
Total No. of Sec. | Total | Gross Unrealized Losses | Less than 12 Months | 12 Months or Greater | |||||||||||||||||||||||
Fair | |||||||||||||||||||||||||||
($ in millions) | Value | No. of Sec. | Fair | Unrealized Losses | No. of Sec. | Fair | Unrealized Losses | ||||||||||||||||||||
Value | Value | ||||||||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | 29 | $ | 1,444.30 | $ | (16.6 | ) | 28 | $ | 1,434.60 | $ | (16.3 | ) | 1 | $ | 9.7 | $ | (.3 | ) | |||||||||
State and local government obligations | 141 | 844.2 | (18.4 | ) | 119 | 759.3 | (17.1 | ) | 22 | 84.9 | (1.3 | ) | |||||||||||||||
Corporate debt securities | 51 | 997.6 | (20.4 | ) | 45 | 831.1 | (17.8 | ) | 6 | 166.5 | (2.6 | ) | |||||||||||||||
Residential mortgage-backed securities | 66 | 763.5 | (14.1 | ) | 45 | 597.6 | (7.9 | ) | 21 | 165.9 | (6.2 | ) | |||||||||||||||
Commercial mortgage-backed securities | 76 | 1,061.90 | (37.8 | ) | 60 | 809.2 | (19.7 | ) | 16 | 252.7 | (18.1 | ) | |||||||||||||||
Other asset-backed securities | 25 | 287.2 | (2.1 | ) | 22 | 233.3 | (1.8 | ) | 3 | 53.9 | (.3 | ) | |||||||||||||||
Redeemable preferred stocks | 4 | 122.7 | (9.7 | ) | 0 | 0 | 0 | 4 | 122.7 | (9.7 | ) | ||||||||||||||||
Total fixed maturities | 392 | 5,521.40 | (119.1 | ) | 319 | 4,665.10 | (80.6 | ) | 73 | 856.3 | (38.5 | ) | |||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 7 | 142.3 | (4.5 | ) | 7 | 142.3 | (4.5 | ) | 0 | 0 | 0 | ||||||||||||||||
Common equities | 24 | 59.7 | (2.4 | ) | 20 | 58.5 | (2.4 | ) | 4 | 1.2 | 0 | ||||||||||||||||
Total equity securities | 31 | 202 | (6.9 | ) | 27 | 200.8 | (6.9 | ) | 4 | 1.2 | 0 | ||||||||||||||||
Total portfolio | 423 | $ | 5,723.40 | $ | (126.0 | ) | 346 | $ | 4,865.90 | $ | (87.5 | ) | 77 | $ | 857.5 | $ | (38.5 | ) | |||||||||
Total No. of Sec. | Total | Gross | Less than 12 Months | 12 Months or Greater | |||||||||||||||||||||||
Fair | Unrealized | ||||||||||||||||||||||||||
($ in millions) | Value | Losses | No. of Sec. | Fair | Unrealized | No. of Sec. | Fair | Unrealized | |||||||||||||||||||
Value | Losses | Value | Losses | ||||||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | 0 | $ | 0 | $ | 0 | 0 | $ | 0 | $ | 0 | 0 | $ | 0 | $ | 0 | ||||||||||||
State and local government obligations | 44 | 162.8 | (.6 | ) | 37 | 123.1 | (.5 | ) | 7 | 39.7 | (.1 | ) | |||||||||||||||
Corporate debt securities | 8 | 128.2 | (1.0 | ) | 8 | 128.2 | (1.0 | ) | 0 | 0 | 0 | ||||||||||||||||
Residential mortgage-backed securities | 28 | 149.2 | (9.2 | ) | 5 | 40.2 | (.6 | ) | 23 | 109 | (8.6 | ) | |||||||||||||||
Commercial mortgage-backed securities | 10 | 7.1 | (.1 | ) | 5 | 2.1 | 0 | 5 | 5 | (.1 | ) | ||||||||||||||||
Other asset-backed securities | 4 | 25 | (.1 | ) | 3 | 20.8 | 0 | 1 | 4.2 | (.1 | ) | ||||||||||||||||
Redeemable preferred stocks | 5 | 155.7 | (12.7 | ) | 1 | 24.9 | 0 | 4 | 130.8 | (12.7 | ) | ||||||||||||||||
Total fixed maturities | 99 | 628 | (23.7 | ) | 59 | 339.3 | (2.1 | ) | 40 | 288.7 | (21.6 | ) | |||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Common equities | 97 | 118.2 | (10.3 | ) | 80 | 100.7 | (8.2 | ) | 17 | 17.5 | (2.1 | ) | |||||||||||||||
Total equity securities | 97 | 118.2 | (10.3 | ) | 80 | 100.7 | (8.2 | ) | 17 | 17.5 | (2.1 | ) | |||||||||||||||
Total portfolio | 196 | $ | 746.2 | $ | (34.0 | ) | 139 | $ | 440 | $ | (10.3 | ) | 57 | $ | 306.2 | $ | (23.7 | ) | |||||||||
The increase in the number of our fixed-maturity securities with unrealized losses is the result of the decline in prices associated with the general rise in interest rates. The amount of securities in an unrealized loss position for greater than 12 months decreased in our common equity portfolio, which was the result of significant increases in the equity market values in 2013 and losses recognized in net income as a result of our other-than-temporary impairment review process. We had no material decreases in valuation as a result of credit rating downgrades on our fixed-maturity securities during 2013. Unrealized losses on our nonredeemable preferred stocks related to seven issues with unrealized losses, averaging approximately 3% of our total cost of those securities. A review of these securities concluded that the unrealized losses are market-related adjustments to the values, which were determined not to be other-than-temporary, and we continue to expect to recover our initial investments on these securities. All of the securities in an unrealized loss position at December 31, 2013 in the table above are current with respect to required principal and interest payments. | |||||||||||||||||||||||||||
Other-Than-Temporary Impairment (OTTI) The following table shows the total non-credit portion of the OTTI recorded in accumulated other comprehensive income, reflecting the original non-credit loss at the time the credit impairment was determined: | |||||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||||
(millions) | 2013 | 2012 | |||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
Residential mortgage-backed securities | $ | (44.1 | ) | $ | (44.2 | ) | |||||||||||||||||||||
Commercial mortgage-backed securities | (.9 | ) | (.9 | ) | |||||||||||||||||||||||
Total fixed maturities | $ | (45.0 | ) | $ | (45.1 | ) | |||||||||||||||||||||
The following tables provide rollforwards of the amounts related to credit losses recognized in earnings for the periods ended December 31, 2013, 2012, and 2011, for which a portion of the OTTI losses were also recognized in accumulated other comprehensive income at the time the credit impairments were determined and recognized: | |||||||||||||||||||||||||||
(millions) | Residential | Commercial | Corporate | Total | |||||||||||||||||||||||
Mortgage- | Mortgage- | Debt | |||||||||||||||||||||||||
Backed | Backed | ||||||||||||||||||||||||||
Balance at December 31, 2012 | $ | 27.1 | $ | 0.6 | $ | 0 | $ | 27.7 | |||||||||||||||||||
Credit losses for which an OTTI was previously recognized | 0.1 | 0 | 0 | 0.1 | |||||||||||||||||||||||
Credit losses for which an OTTI was not previously recognized | 0 | 0 | 0 | 0 | |||||||||||||||||||||||
Reductions for securities sold/matured | 0 | 0 | 0 | 0 | |||||||||||||||||||||||
Change in recoveries of future cash flows expected to be collected1,2 | (7.8 | ) | (.2 | ) | 0 | (8.0 | ) | ||||||||||||||||||||
Reductions for previously recognized credit impairments | (.2 | ) | 0 | 0 | (.2 | ) | |||||||||||||||||||||
written-down to fair value3 | |||||||||||||||||||||||||||
Balance at December 31, 2013 | $ | 19.2 | $ | 0.4 | $ | 0 | $ | 19.6 | |||||||||||||||||||
(millions) | Residential | Commercial | Corporate | Total | |||||||||||||||||||||||
Mortgage- | Mortgage- | Debt | |||||||||||||||||||||||||
Backed | Backed | ||||||||||||||||||||||||||
Balance at December 31, 2011 | $ | 34.5 | $ | 1.3 | $ | 0 | $ | 35.8 | |||||||||||||||||||
Credit losses for which an OTTI was previously recognized | 0.1 | 0 | 0 | 0.1 | |||||||||||||||||||||||
Credit losses for which an OTTI was not previously recognized | 0.3 | 0 | 0 | 0.3 | |||||||||||||||||||||||
Reductions for securities sold/matured | 0 | (.2 | ) | 0 | (.2 | ) | |||||||||||||||||||||
Change in recoveries of future cash flows expected to be collected1,2 | (3.8 | ) | (.2 | ) | 0 | (4.0 | ) | ||||||||||||||||||||
Reductions for previously recognized credit impairments | (4.0 | ) | (.3 | ) | 0 | (4.3 | ) | ||||||||||||||||||||
written-down to fair value3 | |||||||||||||||||||||||||||
Balance at December 31, 2012 | $ | 27.1 | $ | 0.6 | $ | 0 | $ | 27.7 | |||||||||||||||||||
(millions) | Residential | Commercial | Corporate | Total | |||||||||||||||||||||||
Mortgage- | Mortgage- | Debt | |||||||||||||||||||||||||
Backed | Backed | ||||||||||||||||||||||||||
Balance at December 31, 2010 | $ | 32.3 | $ | 1 | $ | 6.5 | $ | 39.8 | |||||||||||||||||||
Credit losses for which an OTTI was previously recognized | 1.4 | 0 | 0 | 1.4 | |||||||||||||||||||||||
Credit losses for which an OTTI was not previously recognized | 1.1 | 0.4 | 0 | 1.5 | |||||||||||||||||||||||
Reductions for securities sold/matured | 0 | 0 | 0 | 0 | |||||||||||||||||||||||
Change in recoveries of future cash flows expected to be collected1,2 | 0.8 | 0.3 | (6.5 | ) | (5.4 | ) | |||||||||||||||||||||
Reductions for previously recognized credit impairments | (1.1 | ) | (.4 | ) | 0 | (1.5 | ) | ||||||||||||||||||||
written-down to fair value3 | |||||||||||||||||||||||||||
Balance at December 31, 2011 | $ | 34.5 | $ | 1.3 | $ | 0 | $ | 35.8 | |||||||||||||||||||
1 Reflects expected recovery of prior period impairments that will be accreted into income over the remaining life of the security. | |||||||||||||||||||||||||||
2 Includes $2.6 million, $1.4 million, and $2.0 million at December 31, 2013, 2012, and 2011, respectively, received in excess of the cash flows expected to be collected at the time of the write-downs. | |||||||||||||||||||||||||||
3 Reflects reductions of prior credit impairments where the current credit impairment requires writing securities down to fair value (i.e., no remaining non-credit loss). | |||||||||||||||||||||||||||
Although we determined that it is more likely than not that we will not be required to sell the securities prior to the recovery of their respective cost bases (which could be maturity), we are required to measure the amount of credit losses on the securities that were determined to be other-than-temporarily impaired. In that process, we considered a number of factors and inputs related to the individual securities. The methodology and significant inputs used to measure the amount of credit losses in our portfolio included: current performance indicators on the underlying assets (e.g., delinquency rates, foreclosure rates, and default rates); credit support (via current levels of subordination); historical credit ratings; and updated cash flow expectations based upon these performance indicators. In order to determine the amount of credit loss, if any, the net present value of the cash flows expected (i.e., expected recovery value) was calculated using the current book yield for each security, and was compared to its current amortized value. In the event that the net present value was below the amortized value, a credit loss was deemed to exist, and the security was written down. | |||||||||||||||||||||||||||
Net Realized Gains (Losses) The components of net realized gains (losses) for the years ended December 31, were: | |||||||||||||||||||||||||||
(millions) | 2013 | 2012 | 2011 | ||||||||||||||||||||||||
Gross realized gains on security sales | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | $ | 8.5 | $ | 20.2 | $ | 59.1 | |||||||||||||||||||||
State and local government obligations | 7.7 | 15 | 3.5 | ||||||||||||||||||||||||
Corporate and other debt securities | 47.7 | 58.1 | 23 | ||||||||||||||||||||||||
Residential mortgage-backed securities | 3 | 1.2 | 2 | ||||||||||||||||||||||||
Commercial mortgage-backed securities | 10 | 19.3 | 0.3 | ||||||||||||||||||||||||
Other asset-backed securities | 0 | 0.9 | 2.1 | ||||||||||||||||||||||||
Redeemable preferred stocks | 0 | 0.7 | 4.6 | ||||||||||||||||||||||||
Total fixed maturities | 76.9 | 115.4 | 94.6 | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 126.3 | 78.2 | 148.9 | ||||||||||||||||||||||||
Common equities | 68.6 | 167 | 11.6 | ||||||||||||||||||||||||
Subtotal gross realized gains on security sales | 271.8 | 360.6 | 255.1 | ||||||||||||||||||||||||
Gross realized losses on security sales | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | (3.7 | ) | (1.9 | ) | (9.3 | ) | |||||||||||||||||||||
Corporate and other debt securities | (6.2 | ) | (.6 | ) | (3.5 | ) | |||||||||||||||||||||
Commercial mortgage-backed securities | (1.8 | ) | 0 | 0 | |||||||||||||||||||||||
Redeemable preferred stocks | (.1 | ) | (.4 | ) | (2.2 | ) | |||||||||||||||||||||
Total fixed maturities | (11.8 | ) | (2.9 | ) | (15.0 | ) | |||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | (.1 | ) | (1.1 | ) | 0 | ||||||||||||||||||||||
Common equities | (.6 | ) | (27.1 | ) | (36.5 | ) | |||||||||||||||||||||
Subtotal gross realized losses on security sales | (12.5 | ) | (31.1 | ) | (51.5 | ) | |||||||||||||||||||||
Net realized gains (losses) on security sales | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | 4.8 | 18.3 | 49.8 | ||||||||||||||||||||||||
State and local government obligations | 7.7 | 15 | 3.5 | ||||||||||||||||||||||||
Corporate and other debt securities | 41.5 | 57.5 | 19.5 | ||||||||||||||||||||||||
Residential mortgage-backed securities | 3 | 1.2 | 2 | ||||||||||||||||||||||||
Commercial mortgage-backed securities | 8.2 | 19.3 | 0.3 | ||||||||||||||||||||||||
Other asset-backed securities | 0 | 0.9 | 2.1 | ||||||||||||||||||||||||
Redeemable preferred stocks | (.1 | ) | 0.3 | 2.4 | |||||||||||||||||||||||
Total fixed maturities | 65.1 | 112.5 | 79.6 | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 126.2 | 77.1 | 148.9 | ||||||||||||||||||||||||
Common equities | 68 | 139.9 | (24.9 | ) | |||||||||||||||||||||||
Subtotal net realized gains (losses) on security sales | 259.3 | 329.5 | 203.6 | ||||||||||||||||||||||||
Other-than-temporary impairment losses | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
Residential mortgage-backed securities | (.6 | ) | (1.6 | ) | (3.3 | ) | |||||||||||||||||||||
Commercial mortgage-backed securities | 0 | (.1 | ) | (.6 | ) | ||||||||||||||||||||||
Total fixed maturities | (.6 | ) | (1.7 | ) | (3.9 | ) | |||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Common equities | (5.5 | ) | (1.8 | ) | (.2 | ) | |||||||||||||||||||||
Subtotal other-than-temporary impairment losses | (6.1 | ) | (3.5 | ) | (4.1 | ) | |||||||||||||||||||||
Other gains (losses) | |||||||||||||||||||||||||||
Hybrid securities | 6.4 | 14.3 | 1.7 | ||||||||||||||||||||||||
Derivative instruments | 56.6 | (43.1 | ) | (98.9 | ) | ||||||||||||||||||||||
Litigation settlements | 2.2 | 9.6 | 0.3 | ||||||||||||||||||||||||
Subtotal other gains (losses) | 65.2 | (19.2 | ) | (96.9 | ) | ||||||||||||||||||||||
Total net realized gains (losses) on securities | $ | 318.4 | $ | 306.8 | $ | 102.6 | |||||||||||||||||||||
Gross realized gains and losses were the result of sales transactions in our fixed-income portfolio, related to movements in credit spreads and interest rates, rebalancing of our equity-indexed portfolio, and tax management strategies. In addition, gains and losses reflect recoveries from litigation settlements and holding period valuation changes on hybrids and derivatives. Also included are write-downs for securities determined to be other-than-temporarily impaired in our fixed-maturity and/or equity portfolios. | |||||||||||||||||||||||||||
Net Investment Income The components of net investment income for the years ended December 31, were: | |||||||||||||||||||||||||||
(millions) | 2013 | 2012 | 2011 | ||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | $ | 50.2 | $ | 49.8 | $ | 58 | |||||||||||||||||||||
State and local government obligations | 48 | 51.1 | 60 | ||||||||||||||||||||||||
Foreign government obligations | 0.2 | 0 | 0 | ||||||||||||||||||||||||
Corporate debt securities | 98.8 | 107.5 | 106.7 | ||||||||||||||||||||||||
Residential mortgage-backed securities | 28.1 | 16.1 | 18.6 | ||||||||||||||||||||||||
Commercial mortgage-backed securities | 74.8 | 82.2 | 83.4 | ||||||||||||||||||||||||
Other asset-backed securities | 16.7 | 20.3 | 24.5 | ||||||||||||||||||||||||
Redeemable preferred stocks | 21.2 | 24.2 | 33 | ||||||||||||||||||||||||
Total fixed maturities | 338 | 351.2 | 384.2 | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 36.2 | 43.8 | 57.7 | ||||||||||||||||||||||||
Common equities | 45.8 | 44.9 | 35.7 | ||||||||||||||||||||||||
Short-term investments: | |||||||||||||||||||||||||||
Other short-term investments | 2 | 3.1 | 2.4 | ||||||||||||||||||||||||
Investment income | 422 | 443 | 480 | ||||||||||||||||||||||||
Investment expenses | (18.8 | ) | (15.4 | ) | (13.5 | ) | |||||||||||||||||||||
Net investment income | $ | 403.2 | $ | 427.6 | $ | 466.5 | |||||||||||||||||||||
Trading Securities At December 31, 2013 and 2012, we did not hold any trading securities and we did not have any net realized gains (losses) on trading securities for the years ended December 31, 2013, 2012, and 2011. | |||||||||||||||||||||||||||
Derivative Instruments For all derivative positions discussed below, realized holding period gains and losses are netted with any upfront cash that may be exchanged under the contract to determine if the net position should be classified either as an asset or liability. To be reported as a net derivative asset and a component of the available-for-sale portfolio, the inception-to-date realized gain on the derivative position at period end would have to exceed any upfront cash received. On the other hand, a net derivative liability would include any inception-to-date realized loss plus the amount of upfront cash received (or netted, if upfront cash was paid) and would be reported as a component of other liabilities. These net derivative assets/liabilities are not separately disclosed on the balance sheet due to their immaterial effect on our financial condition, cash flows, and results of operations. | |||||||||||||||||||||||||||
The following table shows the status of our derivative instruments at December 31, 2013 and 2012, and for the years ended December 31, 2013, 2012, and 2011; amounts are on a pretax basis: | |||||||||||||||||||||||||||
(millions) | Balance Sheet2 | Comprehensive | |||||||||||||||||||||||||
Income Statement | |||||||||||||||||||||||||||
Notional Value1 | Assets | Net Realized | |||||||||||||||||||||||||
(Liabilities) | Gains (Losses) | ||||||||||||||||||||||||||
Fair Value | on Securities | ||||||||||||||||||||||||||
Years ended | |||||||||||||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||||||||||||
Derivatives | 2013 | 2012 | 2011 | Purpose | Classification | 2013 | 2012 | 2013 | 2012 | 2011 | |||||||||||||||||
designated as: | |||||||||||||||||||||||||||
Hedging instruments | |||||||||||||||||||||||||||
Closed: | |||||||||||||||||||||||||||
Ineffective cash flow hedge | $ | 54 | $ | 31 | $ | 15 | Manage | NA | $ | 0 | $ | 0 | $ | 0.8 | $ | 0.6 | $ | 0.3 | |||||||||
interest | |||||||||||||||||||||||||||
rate risk | |||||||||||||||||||||||||||
Non-hedging instruments | |||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||
Interest rate swaps | 750 | 0 | 0 | Manage portfolio duration | Investments - fixed | 68.1 | 0 | 59.8 | 0 | 0 | |||||||||||||||||
maturities | |||||||||||||||||||||||||||
Corporate credit default swaps | 0 | 0 | 25 | Manage | Investments - fixed | 0 | 0 | 0 | 0 | (.2 | ) | ||||||||||||||||
credit | maturities | ||||||||||||||||||||||||||
risk | |||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||
Interest rate swaps | 0 | 1,263 | 1,263 | Manage | Other liabilities | 0 | (95.5 | ) | 0 | (42.7 | ) | (74.0 | ) | ||||||||||||||
portfolio | |||||||||||||||||||||||||||
duration | |||||||||||||||||||||||||||
Closed: | |||||||||||||||||||||||||||
Interest rate swaps | 1,263 | 0 | 350 | Manage | NA | 0 | 0 | (4.0 | ) | 0 | (25.5 | ) | |||||||||||||||
portfolio | |||||||||||||||||||||||||||
duration | |||||||||||||||||||||||||||
Corporate credit default swaps | 0 | 25 | 10 | Manage | NA | 0 | 0 | 0 | (1.0 | ) | 0.5 | ||||||||||||||||
credit | |||||||||||||||||||||||||||
risk | |||||||||||||||||||||||||||
Total | NA | NA | NA | $ | 68.1 | $ | (95.5 | ) | $ | 56.6 | $ | (43.1 | ) | $ | (98.9 | ) | |||||||||||
1 The amounts represent the value held at year end for open positions and the maximum amount held during the year for closed positions. | |||||||||||||||||||||||||||
2 To the extent we hold both derivative assets and liabilities with the same counterparty that are subject to an enforceable master netting arrangement, we expect that we will report them on a gross basis on our balance sheets, consistent with our historical presentation. | |||||||||||||||||||||||||||
NA =ot Applicable | |||||||||||||||||||||||||||
CASH FLOW HEDGES | |||||||||||||||||||||||||||
During the years ended December 31, 2013, 2012, and 2011, we repurchased, in the open market, $54.1 million, $30.9 million, and $15.0 million, respectively, in aggregate principal amount of our 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 (the “6.70% Debentures”). For the portion of the 6.70% Debentures we purchased, we reclassified $0.8 million, $0.6 million, and $0.3 million, in the respective years, on a pretax basis, of the unrealized gain on forecasted transactions from accumulated other comprehensive income on the balance sheet to net realized gains on securities on the comprehensive income statement. | |||||||||||||||||||||||||||
In anticipation of issuing the 6.70% Debentures in 2007, we entered into a forecasted debt issuance hedge (cash flow hedge) against a possible rise in interest rates. Upon issuance of the 6.70% Debentures, the hedge was closed, and we recognized a pretax gain of $34.4 million, which was recorded as part of accumulated other comprehensive income. The $34.4 million gain, less the $0.8 million, $0.6 million, and $0.3 million reclassifications mentioned above, was deferred and is being recognized as a decrease to interest expense over the 10-year fixed interest rate term of the 6.70% Debentures. | |||||||||||||||||||||||||||
During 2011, we issued $500 million of 3.75% Senior Notes due 2021 (the “3.75% Senior Notes”) and entered into a forecasted debt issuance hedge (cash flow hedge) against a possible rise in interest rates (see Note 4 - Debt for further information). Upon issuance of the 3.75% Senior Notes in August 2011, the hedge was closed and we recognized, as part of accumulated other comprehensive income, a pretax unrealized loss of $5.1 million. The $5.1 million loss was deferred and is being recognized as an increase to interest expense over the life of the 3.75% Senior Notes. | |||||||||||||||||||||||||||
During both 2013 and 2012, we recognized $2.1 million as a net decrease to interest expense on these closed debt issuance cash flow hedges, compared to $2.6 million during 2011. | |||||||||||||||||||||||||||
INTEREST RATE SWAPS | |||||||||||||||||||||||||||
At December 31, 2013, 2012, and 2011, we invested in interest rate swap positions primarily to manage the fixed-income portfolio duration. During 2013, we opened three 10-year interest rate swap positions with a total notional value of $750 million. In each case, we are paying a fixed rate and receiving a variable rate, effectively shortening the duration of our fixed-income portfolio. As of December 31, 2013, we recognized a fair value gain of $68.1 million, on the balance sheet, reflecting rising interest rates since the positions were opened. | |||||||||||||||||||||||||||
During 2013, we closed three interest rate swap positions with a total notional value of $1,263 million. The closed positions included a 9-year interest rate swap position (opened in 2009 and partially closed in 2011) and two 5-year interest rate swap positions (opened in 2011); in each case, we were paying a fixed rate and receiving a variable rate, effectively shortening the duration of our fixed-income portfolio. We recognized a fair value loss of $95.5 million on the closed positions as of December 31, 2012, which resulted from an overall decline in interest rates from the inception of the trades. | |||||||||||||||||||||||||||
As of December 31, 2013, the balance of the cash collateral that we had received from the applicable counterparty on these positions was $62.7 million. As of December 31, 2012 and 2011, the balance of the cash collateral that we had delivered to the applicable counterparty on these positions was $105.0 million and $81.7 million, respectively. | |||||||||||||||||||||||||||
CORPORATE CREDIT DEFAULT SWAPS | |||||||||||||||||||||||||||
Financial Services Sector – We held no credit default swaps in this sector during 2013. During 2012, we closed one position that was opened during 2008, on a corporate issuer within the financial services sector for which we bought credit default protection in the form of a credit default swap for a 5-year time horizon. We held this protection to reduce some of our exposure to additional valuation declines on a preferred stock position of the same issuer. As of December 31, 2011, the balance of the cash collateral that we had received from the counterparty on the then open position was $0.7 million. | |||||||||||||||||||||||||||
Automotive Sector – We held no credit default swaps in this sector during 2013 or 2012. During 2011, we closed one position where we sold credit protection in the form of a corporate credit default swap on one issuer in the automotive sector for a 5-year time horizon; the position was opened during 2010. We would have been required to cover a $10 million notional value if a credit event had been triggered, including failure to pay or bankruptcy by the issuer. We acquired an equal par value amount of U.S. Treasury Notes with a similar maturity to cover the credit default swap’s notional exposure. |
Fair_Value
Fair Value | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
Fair Value | ' | ||||||||||||||||||||||||
FAIR VALUE | |||||||||||||||||||||||||
We have categorized our financial instruments, based on the degree of subjectivity inherent in the method by which they are valued, into a fair value hierarchy of three levels, as follows: | |||||||||||||||||||||||||
• | Level 1: Inputs are unadjusted, quoted prices in active markets for identical instruments at the measurement date (e.g., U.S. government obligations, active exchange-traded equity securities, and certain short-term securities). | ||||||||||||||||||||||||
• | Level 2: Inputs (other than quoted prices included within Level 1) that are observable for the instrument either directly or indirectly (e.g., certain corporate and municipal bonds and certain preferred stocks). This includes: (i) quoted prices for similar instruments in active markets, (ii) quoted prices for identical or similar instruments in markets that are not active, (iii) inputs other than quoted prices that are observable for the instruments, and (iv) inputs that are derived principally from or corroborated by observable market data by correlation or other means. | ||||||||||||||||||||||||
• | Level 3: Inputs that are unobservable. Unobservable inputs reflect our subjective evaluation about the assumptions market participants would use in pricing the financial instrument (e.g., certain structured securities and privately held investments). | ||||||||||||||||||||||||
Determining the fair value of the investment portfolio is the responsibility of management. As part of the responsibility, we evaluate whether a market is distressed or inactive in determining the fair value for our portfolio. We review certain market level inputs to evaluate whether sufficient activity, volume, and new issuances exist to create an active market. Based on this evaluation, we concluded that there was sufficient activity related to the sectors and securities for which we obtained valuations. | |||||||||||||||||||||||||
The composition of the investment portfolio by major security type was: | |||||||||||||||||||||||||
Fair Value | |||||||||||||||||||||||||
(millions) | Level 1 | Level 2 | Level 3 | Total | Cost | ||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
U.S. government obligations | $ | 3,662.20 | $ | 0 | $ | 0 | $ | 3,662.20 | $ | 3,630.40 | |||||||||||||||
State and local government obligations | 0 | 2,256.00 | 0 | 2,256.00 | 2,247.30 | ||||||||||||||||||||
Foreign government obligations | 15.6 | 0 | 0 | 15.6 | 15.6 | ||||||||||||||||||||
Corporate debt securities | 0 | 2,926.60 | 0 | 2,926.60 | 2,885.00 | ||||||||||||||||||||
Subtotal | 3,677.80 | 5,182.60 | 0 | 8,860.40 | 8,778.30 | ||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | 0 | 1,127.70 | 0.2 | 1,127.90 | 1,110.10 | ||||||||||||||||||||
Commercial mortgage-backed | 0 | 2,131.50 | 29 | 2,160.50 | 2,154.40 | ||||||||||||||||||||
Other asset-backed | 0 | 1,077.70 | 0 | 1,077.70 | 1,073.00 | ||||||||||||||||||||
Subtotal asset-backed securities | 0 | 4,336.90 | 29.2 | 4,366.10 | 4,337.50 | ||||||||||||||||||||
Redeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 0 | 102.8 | 0 | 102.8 | 84.2 | ||||||||||||||||||||
Utilities | 0 | 65.6 | 0 | 65.6 | 64.9 | ||||||||||||||||||||
Industrials | 0 | 145.5 | 0 | 145.5 | 150.4 | ||||||||||||||||||||
Subtotal redeemable preferred stocks | 0 | 313.9 | 0 | 313.9 | 299.5 | ||||||||||||||||||||
Total fixed maturities | 3,677.80 | 9,833.40 | 29.2 | 13,540.40 | 13,415.30 | ||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 240.8 | 414.6 | 39 | 694.4 | 431.5 | ||||||||||||||||||||
Utilities | 0 | 16.8 | 0 | 16.8 | 14.2 | ||||||||||||||||||||
Subtotal nonredeemable preferred stocks | 240.8 | 431.4 | 39 | 711.2 | 445.7 | ||||||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Common stocks | 2,530.00 | 0 | 0 | 2,530.00 | 1,450.60 | ||||||||||||||||||||
Other risk investments | 0 | 0 | 0.5 | 0.5 | 0.5 | ||||||||||||||||||||
Subtotal common equities | 2,530.00 | 0 | 0.5 | 2,530.50 | 1,451.10 | ||||||||||||||||||||
Total fixed maturities and equity securities | 6,448.60 | 10,264.80 | 68.7 | 16,782.10 | 15,312.10 | ||||||||||||||||||||
Short-term investments: | |||||||||||||||||||||||||
Other short-term investments | 987.8 | 284.8 | 0 | 1,272.60 | 1,272.60 | ||||||||||||||||||||
Total portfolio | $ | 7,436.40 | $ | 10,549.60 | $ | 68.7 | $ | 18,054.70 | $ | 16,584.70 | |||||||||||||||
Debt | $ | 0 | $ | 2,073.70 | $ | 0 | $ | 2,073.70 | $ | 1,860.90 | |||||||||||||||
Fair Value | |||||||||||||||||||||||||
(millions) | Level 1 | Level 2 | Level 3 | Total | Cost | ||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
U.S. government obligations | $ | 2,896.50 | $ | 0 | $ | 0 | $ | 2,896.50 | $ | 2,806.40 | |||||||||||||||
State and local government obligations | 0 | 1,964.40 | 0 | 1,964.40 | 1,914.40 | ||||||||||||||||||||
Foreign government obligations | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||
Corporate debt securities | 0 | 3,113.00 | 0 | 3,113.00 | 2,982.90 | ||||||||||||||||||||
Subtotal | 2,896.50 | 5,077.40 | 0 | 7,973.90 | 7,703.70 | ||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | 0 | 382.7 | 45.5 | 428.2 | 413.4 | ||||||||||||||||||||
Commercial mortgage-backed | 0 | 2,023.40 | 25.3 | 2,048.70 | 1,963.90 | ||||||||||||||||||||
Other asset-backed | 0 | 948.6 | 0 | 948.6 | 936 | ||||||||||||||||||||
Subtotal asset-backed securities | 0 | 3,354.70 | 70.8 | 3,425.50 | 3,313.30 | ||||||||||||||||||||
Redeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 0 | 129.7 | 0 | 129.7 | 110.7 | ||||||||||||||||||||
Utilities | 0 | 66.7 | 0 | 66.7 | 64.9 | ||||||||||||||||||||
Industrials | 0 | 178.3 | 0 | 178.3 | 181.3 | ||||||||||||||||||||
Subtotal redeemable preferred stocks | 0 | 374.7 | 0 | 374.7 | 356.9 | ||||||||||||||||||||
Total fixed maturities | 2,896.50 | 8,806.80 | 70.8 | 11,774.10 | 11,373.90 | ||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 259.6 | 494.5 | 31.9 | 786 | 383.3 | ||||||||||||||||||||
Utilities | 0 | 26.4 | 0 | 26.4 | 20.7 | ||||||||||||||||||||
Subtotal nonredeemable preferred stocks | 259.6 | 520.9 | 31.9 | 812.4 | 404 | ||||||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Common stocks | 1,887.00 | 0 | 0 | 1,887.00 | 1,367.20 | ||||||||||||||||||||
Other risk investments | 0 | 0 | 12 | 12 | 3.1 | ||||||||||||||||||||
Subtotal common equities | 1,887.00 | 0 | 12 | 1,899.00 | 1,370.30 | ||||||||||||||||||||
Total fixed maturities and equity securities | 5,043.10 | 9,327.70 | 114.7 | 14,485.50 | 13,148.20 | ||||||||||||||||||||
Short-term investments: | |||||||||||||||||||||||||
Other short-term investments | 1,679.90 | 310.1 | 0 | 1,990.00 | 1,990.00 | ||||||||||||||||||||
Total portfolio | $ | 6,723.00 | $ | 9,637.80 | $ | 114.7 | $ | 16,475.50 | $ | 15,138.20 | |||||||||||||||
Debt | $ | 0 | $ | 2,394.40 | $ | 0 | $ | 2,394.40 | $ | 2,063.10 | |||||||||||||||
Our portfolio valuations classified as either Level 1 or Level 2 in the above tables are priced exclusively by external sources, including: pricing vendors, dealers/market makers, and exchange-quoted prices. During 2013, we did not have any securities that were transferred from Level 1 to Level 2. During 2012, we had one redeemable preferred security with a value of $25.0 million that was transferred from Level 1 to Level 2 as it was no longer traded on an exchange. We recognize transfers between levels at the end of the reporting period. | |||||||||||||||||||||||||
Our short-term security holdings classified as Level 1 are considered highly liquid, actively marketed, and have a very short duration, primarily seven days or less to redemption. These securities are held at their original cost, adjusted for any amortization of discount or premium, since that value very closely approximates what an active market participant would be willing to pay for such securities. The remainder of our short-term securities are classified as Level 2 and are not priced externally since these securities continually trade at par value. These securities are classified as Level 2 since they are primarily longer-dated auction securities issued by municipalities that contain a redemption put feature back to the auction pool with a redemption period of less than seven days. The auction pool is created by a liquidity provider and if the auction is not available at the end of the seven days, we have the right to put the security back to the issuer at par. | |||||||||||||||||||||||||
At December 31, 2013, vendor-quoted prices represented 56% of our Level 1 classifications (excluding short-term investments), compared to 57% at December 31, 2012. The securities quoted by vendors in Level 1 primarily represent our holdings in U.S. Treasury Notes, which are frequently traded and the quotes are considered similar to exchange-traded quotes. The balance of our Level 1 pricing comes from quotes obtained directly from trades made on active exchanges. | |||||||||||||||||||||||||
At both December 31, 2013 and 2012, vendor-quoted prices comprised 98% of our Level 2 classifications (excluding short-term investments), while dealer-quoted prices represented 2%. In our process for selecting a source (e.g., dealer, pricing service) to provide pricing for securities in our portfolio, we reviewed documentation from the sources that detailed the pricing techniques and methodologies used by these sources and determined if their policies adequately considered market activity, either based on specific transactions for the particular security type or based on modeling of securities with similar credit quality, duration, yield, and structure that were recently transacted. Once a source is chosen, we continue to monitor any changes or modifications to their processes by reviewing their documentation on internal controls for pricing and market reviews. We review quality control measures of our sources as they become available to determine if any significant changes have occurred from period to period that might indicate issues or concerns regarding their evaluation or market coverage. | |||||||||||||||||||||||||
As part of our pricing procedures, we obtain quotes from more than one source to help us fully evaluate the market price of securities. However, our internal pricing policy is to use a consistent source for individual securities in order to maintain the integrity of our valuation process. Quotes obtained from the sources are not considered binding offers to transact. Under our policy, when a review of the valuation received from our selected source appears to be outside of what is considered market level activity (which is defined as trading at spreads or yields significantly different than those of comparable securities or outside the general sector level movement without a reasonable explanation), we may use an alternate source’s price. To the extent we determine that it may be prudent to substitute one source’s price for another, we will contact the initial source to obtain an understanding of the factors that may be contributing to the significant price variance, which often leads the source to adjust their pricing input data for future pricing. | |||||||||||||||||||||||||
To allow us to determine if our initial source is providing a price that is outside of a reasonable range, we review our portfolio pricing on a weekly basis. We frequently challenge prices from our sources when a price provided does not match our expectations based on our evaluation of market trends and activity. Initially, we perform a global review of our portfolio by sector to identify securities whose prices appear outside of a reasonable range. We then perform a more detailed review of fair values for securities disclosed as Level 2. We review dealer bids and quotes for these and/or similar securities to determine the market level context for our valuations. We then evaluate inputs relevant for each class of securities disclosed in the preceding hierarchy tables. | |||||||||||||||||||||||||
For our structured debt securities, including commercial, residential, and asset-backed securities, we evaluate available market-related data for these and similar securities related to collateral, delinquencies, and defaults for historical trends and reasonably estimable projections, as well as historical prepayment rates and current prepayment assumptions and cash flow estimates. We further stratify each class of our structured debt securities into more finite sectors (e.g., planned amortization class, first pay, second pay, senior, subordinated, etc.) and use duration, credit quality, and coupon to determine the appropriate fair value. | |||||||||||||||||||||||||
For our corporate debt and preferred stock (redeemable and nonredeemable) portfolios, we review securities by duration, coupon, and credit quality, as well as changes in interest rate and credit spread movements within that stratification. The review also includes recent trades, including: volume traded at various levels that establish a market, issuer specific fundamentals, and industry specific economic news as it comes to light. | |||||||||||||||||||||||||
For our municipal securities (e.g., general obligations, revenue, and housing), we stratify the portfolio to evaluate securities by type, coupon, credit quality, and duration to review price changes relative to credit spread and interest rate changes. Additionally, we look to economic data as it relates to geographic location as an indication of price-to-call or maturity predictors. For municipal housing securities, we look to changes in cash flow projections, both historical and reasonably estimable projections, to understand yield changes and their effect on valuation. | |||||||||||||||||||||||||
Lastly, for our short-term securities, we look at acquisition price relative to the coupon or yield. Since our short-term securities are typically 90 days or less to maturity, with the majority listed in Level 2 being seven days or less to redemption, acquisition price is the best estimate of fair value. | |||||||||||||||||||||||||
We also review data assumptions as supplied by our sources to determine if that data is relevant to current market conditions. In addition, we independently review each sector for transaction volumes, new issuances, and changes in spreads, as well as the overall movement of interest rates along the yield curve to determine if sufficient activity and liquidity exists to provide a credible source for our market valuations. | |||||||||||||||||||||||||
During each valuation period, we create internal estimations of portfolio valuation (performance returns), based on current market-related activity (i.e., interest rate and credit spread movements and other credit-related factors) within each major sector of our portfolio. We compare our internally generated portfolio results with those generated based on quotes we received externally and research material valuation differences. We compare our results to index returns for each major sector adjusting for duration and credit quality differences to better understand our portfolio’s results. Additionally, we review on a monthly basis our external sales transactions and compare the actual final market sales price to a previous market valuation price. This review provides us further validation that our pricing sources are providing market level prices, since we are able to explain significant price changes (i.e., greater than 2%) as known events occur in the marketplace and affect a particular security’s price at sale. | |||||||||||||||||||||||||
This analysis provides us with additional comfort regarding the source’s process, the quality of its review, and its willingness to improve its analysis based on feedback from clients. We believe this effort helps ensure that we are reporting representative fair values for our securities. | |||||||||||||||||||||||||
With limited exceptions, our Level 3 securities are also priced externally; however, due to several factors (e.g., nature of the securities, level of activity, and lack of similar securities trading to obtain observable market level inputs), these valuations are more subjective in nature. Certain private equity investments and fixed-income investments included in the Level 3 category are valued using external pricing supplemented by internal review and analysis. | |||||||||||||||||||||||||
After all the valuations are received and our review is complete, if the inputs used by vendors are determined to not contain sufficient observable market information, we will reclassify the affected security valuations to Level 3. At December 31, 2013 and 2012, securities in our fixed-maturity portfolio listed as Level 3 were comprised substantially of securities that were either: (i) private placement deals, (ii) thinly held and/or traded securities, or (iii) non-investment-grade securities with little liquidity. Based on these factors, it was difficult to independently verify observable market inputs that were used to generate the external valuations we received. At December 31, 2013, we did not have any private common equity securities that were priced internally. At December 31, 2012, we had one private common equity security with a value of $11.2 million that was priced internally; this security was sold in 2013. At December 31, 2013, we had one private preferred equity security with a value of $39.0 million that was priced internally. The same security had a value of $31.9 million at December 31, 2012. At both December 31, 2013 and 2012, we did not have any securities in our fixed-maturity portfolio that were priced internally. Despite the lack of sufficient observable market information, we believe the valuations received in conjunction with our procedures for evaluating third-party prices support the fair values as reported in the financial statements. | |||||||||||||||||||||||||
We review the prices from our external sources for reasonableness using internally developed assumptions to derive prices for the securities, which are then compared to the price we received. Based on our review, all the prices received from external sources remain unadjusted. | |||||||||||||||||||||||||
The following tables provide a summary of changes in fair value associated with Level 3 assets for the years ended December 31, 2013 and 2012: | |||||||||||||||||||||||||
Level 3 Fair Value | |||||||||||||||||||||||||
(millions) | Fair Value at Dec. 31, 2012 | Calls/ | Purchases | Sales | Net Realized | Change in | Net | Fair Value at Dec. 31, 2013 | |||||||||||||||||
Maturities/ | (Gain)/Loss | Valuation | Transfers | ||||||||||||||||||||||
Paydowns | on Sales | In (Out)1 | |||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | $ | 45.5 | $ | (28.6 | ) | $ | 125.1 | $ | 0 | $ | 0 | $ | (.4 | ) | $ | (141.4 | ) | $ | 0.2 | ||||||
Commercial mortgage-backed | 25.3 | (3.4 | ) | 0 | 0 | 0 | 7.1 | 0 | 29 | ||||||||||||||||
Other asset-backed | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||
Total fixed maturities | 70.8 | (32.0 | ) | 125.1 | 0 | 0 | 6.7 | (141.4 | ) | 29.2 | |||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials2 | 31.9 | 0 | 0 | 0 | 0 | 7.1 | 0 | 39 | |||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Other risk investments | 12 | (.5 | ) | 0.3 | (2.4 | ) | (36.0 | ) | 27.1 | 0 | 0.5 | ||||||||||||||
Total Level 3 securities | $ | 114.7 | $ | (32.5 | ) | $ | 125.4 | $ | (2.4 | ) | $ | (36.0 | ) | $ | 40.9 | $ | (141.4 | ) | $ | 68.7 | |||||
1 The $141.4 million was transferred out of Level 3 and into Level 2 due to an increase in liquidity and trading volume in the market. | |||||||||||||||||||||||||
2 The $7.1 million represents net holding period gains on a hybrid security which is reflected in net realized gains (losses) on securities in the comprehensive income statement. | |||||||||||||||||||||||||
Level 3 Fair Value | |||||||||||||||||||||||||
(millions) | Fair Value at Dec. 31, 2011 | Calls/ | Purchases | Sales | Net Realized | Change in | Net | Fair Value at Dec. 31, 2012 | |||||||||||||||||
Maturities/ | (Gain)/Loss | Valuation | Transfers | ||||||||||||||||||||||
Paydowns | on Sales | In (Out) | |||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | $ | 62.3 | $ | (17.3 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0.5 | $ | 0 | $ | 45.5 | ||||||||
Commercial mortgage-backed | 21.3 | (3.7 | ) | 0 | 0 | 0 | 7.7 | 0 | 25.3 | ||||||||||||||||
Other asset-backed | 2.6 | (2.6 | ) | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
Total fixed maturities | 86.2 | (23.6 | ) | 0 | 0 | 0 | 8.2 | 0 | 70.8 | ||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials1 | 0 | 0 | 28.5 | 0 | 0 | 3.4 | 0 | 31.9 | |||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Other risk investments | 11.5 | (.2 | ) | 0 | 0 | 0 | 0.7 | 0 | 12 | ||||||||||||||||
Total Level 3 securities | $ | 97.7 | $ | (23.8 | ) | $ | 28.5 | $ | 0 | $ | 0 | $ | 12.3 | $ | 0 | $ | 114.7 | ||||||||
1 The $3.4 million represents net holding period gains on a hybrid security which is reflected in net realized gains (losses) on securities in the comprehensive income statement. | |||||||||||||||||||||||||
The following table provides a summary of the quantitative information about Level 3 fair value measurements for our applicable securities at December 31: | |||||||||||||||||||||||||
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||||||
($ in millions) | Fair Value at Dec. 31, 2013 | Valuation Technique | Unobservable Input | Unobservable Input Assumption | |||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | $ | 0.2 | External vendor | Prepayment rate1 | 0 | ||||||||||||||||||||
Commercial mortgage-backed | 29 | External vendor | Prepayment rate2 | 0 | |||||||||||||||||||||
Total fixed maturities | 29.2 | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 39 | Multiple of tangible net book value | Price to book ratio multiple | 1.9 | |||||||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Other risk investments | 0 | ||||||||||||||||||||||||
Subtotal Level 3 securities | 68.2 | ||||||||||||||||||||||||
Third-party pricing exemption securities3 | 0.5 | ||||||||||||||||||||||||
Total Level 3 securities | $ | 68.7 | |||||||||||||||||||||||
1 Assumes that one security has 0% of the principal amount of the underlying loans that will be paid off prematurely in each year. | |||||||||||||||||||||||||
2 Assumes that two securities have 0% of the principal amount of the underlying loans that will be paid off prematurely in each year. | |||||||||||||||||||||||||
3 The fair values for these securities were obtained from non-binding external sources where unobservable inputs are not reasonably available to us. | |||||||||||||||||||||||||
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||||||
($ in millions) | Fair Value at Dec. 31, 2012 | Valuation Technique | Unobservable Input | Unobservable Input Assumption | |||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | $ | 0.2 | External vendor | Prepayment rate1 | 16 | ||||||||||||||||||||
Commercial mortgage-backed | 25.3 | External vendor | Prepayment rate2 | 0 | |||||||||||||||||||||
Total fixed maturities | 25.5 | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 31.9 | Multiple of tangible net book value | Price to book ratio multiple | 1.9 | |||||||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Other risk investments | 11.2 | Discounted consolidated equity | Discount for lack of marketability | 20 | % | ||||||||||||||||||||
Subtotal Level 3 securities | 68.6 | ||||||||||||||||||||||||
Third-party pricing exemption securities3 | 46.1 | ||||||||||||||||||||||||
Total Level 3 securities | $ | 114.7 | |||||||||||||||||||||||
1 Assumes that one security has 16% of the principal amount of the underlying loans that will be paid off prematurely in each year. | |||||||||||||||||||||||||
2 Assumes that three securities have 0% of the principal amount of the underlying loans that will be paid off prematurely in each year. | |||||||||||||||||||||||||
3 The fair values for these securities were obtained from non-binding external sources where unobservable inputs are not reasonably available to us. | |||||||||||||||||||||||||
Due to the relative size of the securities’ fair values compared to the total portfolio’s fair value, any changes in pricing methodology would not have a significant change in valuation that would materially impact net and comprehensive income. During the years ended December 31, 2013 and 2012, there were no material assets or liabilities measured at fair value on a nonrecurring basis. |
Debt
Debt | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Debt | ' | |||||||||||||
DEBT | ||||||||||||||
Debt at December 31 consisted of: | ||||||||||||||
2013 | 2012 | |||||||||||||
(millions) | Carrying | Fair | Carrying | Fair | ||||||||||
Value | Value | Value | Value | |||||||||||
7% Notes due 2013 (issued: $150.0, October 1993) | $ | 0 | $ | 0 | $ | 149.9 | $ | 157.1 | ||||||
3.75% Senior Notes due 2021 (issued: $500.0, August 2011) | 497.6 | 509.1 | 497.3 | 549.1 | ||||||||||
6 5/8% Senior Notes due 2029 (issued: $300.0, March 1999) | 295.3 | 359.6 | 295.2 | 385 | ||||||||||
6.25% Senior Notes due 2032 (issued: $400.0, November 2002) | 394.6 | 473.7 | 394.5 | 513.5 | ||||||||||
6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 (issued: $1,000.0, June 2007; outstanding: $677.1 and $731.2) | 673.4 | 731.3 | 726.2 | 789.7 | ||||||||||
Total | $ | 1,860.90 | $ | 2,073.70 | $ | 2,063.10 | $ | 2,394.40 | ||||||
All of the outstanding debt was issued by The Progressive Corporation. Debt includes amounts we have borrowed and contributed to the capital of our insurance subsidiaries or used, or have available for use, for other business purposes. Fair values are obtained from external sources. There are no restrictive financial covenants or credit rating triggers on our debt. | ||||||||||||||
Interest on all debt is payable semiannually at the stated rates. However, the 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 (the “6.70% Debentures”) will only bear interest at this fixed annual rate through, but excluding, June 15, 2017. Thereafter, the 6.70% Debentures will bear interest at an annual rate equal to the three-month LIBOR plus 2.0175%, and the interest will be payable quarterly until the 6.70% Debentures are redeemed or retired. | ||||||||||||||
Except for the 6.70% Debentures, all principal is due at the maturity stated in the table above. The 6.70% Debentures will become due on June 15, 2037, the scheduled maturity date, but only to the extent that we have received sufficient net proceeds from the sale of certain qualifying capital securities. We must use our commercially reasonable efforts, subject to certain market disruption events, to sell enough qualifying capital securities to permit repayment of the 6.70% Debentures in full on the scheduled maturity date or, if sufficient proceeds are not realized from the sale of such qualifying capital securities by such date, on each interest payment date thereafter. Any remaining outstanding principal will be due on June 15, 2067, the final maturity date. | ||||||||||||||
We retired the entire $150 million of our 7% Notes and the entire $350 million of our 6.375% Senior Notes at maturity in October 2013 and January 2012, respectively. The 3.75% Senior Notes, the 6 5/8% Senior Notes, and the 6.25% Senior Notes (collectively, “Senior Notes”) may be redeemed in whole or in part at any time, at our option, subject to a “make-whole” provision. The 6.70% Debentures may be redeemed, in whole or in part, at any time: (a) prior to June 15, 2017, at a redemption price equal to the greater of (i) 100% of the principal amount of the 6.70% Debentures being redeemed, or (ii) a “make-whole” amount, in each case plus any accrued and unpaid interest; or (b) on or after June 15, 2017, at a redemption price equal to 100% of the principal amount of the 6.70% Debentures being redeemed, plus any accrued and unpaid interest. | ||||||||||||||
During 2013 and 2012, we repurchased, in the open market, $54.1 million and $30.9 million, respectively, in aggregate principal amount of our 6.70% Debentures. Since the amount paid exceeded the carrying value of the debt we repurchased, we recognized losses on these extinguishments of $4.3 million and $1.8 million for 2013 and 2012, respectively. | ||||||||||||||
Prior to issuance of each of the Senior Notes and 6.70% Debentures, we entered into forecasted debt issuance hedges against possible rises in interest rates. Upon issuance of the applicable debt securities, the hedges were closed and we recognized unrealized gains (losses) as part of accumulated other comprehensive income. The original unrealized gain (loss) at the time of each debt issuance and the unamortized balance at December 31, 2013, on a pretax basis, of these hedges, were as follows: | ||||||||||||||
(millions) | Unrealized Gain (Loss) | Unamortized Balance | ||||||||||||
at Debt Issuance | at December 31, 2013 | |||||||||||||
3.75% Senior Notes | $ | (5.1 | ) | $ | (4.1 | ) | ||||||||
6 5/8% Senior Notes | (4.2 | ) | (3.3 | ) | ||||||||||
6.25% Senior Notes | 5.1 | 4.1 | ||||||||||||
6.70% Debentures | 34.4 | 9.7 | ||||||||||||
The gains (losses) on these hedges are deferred and are being amortized as adjustments to interest expense over the life of the related Senior Notes, and over the 10-year fixed interest rate term for the 6.70% Debentures. In addition to this amortization, during 2013 and 2012, we reclassified $0.8 million and $0.6 million, respectively, on a pretax basis, from accumulated other comprehensive income on the balance sheet to net realized gains on securities on the comprehensive income statement, reflecting the portion of the unrealized gain on forecasted transactions that was related to the portion of the 6.70% Debentures repurchased during the periods. | ||||||||||||||
In March 2013, we entered into an unsecured, discretionary line of credit (the "Line of Credit") with PNC Bank, National Association ("PNC") in the maximum principal amount of $100 million. Subject to the terms and conditions of the Line of Credit documents, advances under the Line of Credit (if any) will bear interest at a variable rate equal to the higher of PNC's Prime Rate and the sum of the Federal Funds Open Rate plus 50 basis points. Each advance must be repaid on the 30th date after the advance or, if earlier, on March 25, 2014, the expiration date of the Line of Credit. Prepayments are permitted without penalty. All advances under the Line of Credit are subject to PNC's discretion. We had no borrowings under the Line of Credit in 2013. | ||||||||||||||
During 2012, we had the ability to borrow up to $125 million under the 364-Day Secured Liquidity Credit Facility Agreement (“Credit Facility Agreement”) with PNC. The Credit Facility Agreement expired on December 31, 2012. The purpose of the credit facility was to provide liquidity in the event of disruptions in our cash management operations, such as disruptions in the financial markets or related facilities that could have affected our ability to transfer or receive funds. We did not pay facility fees in 2012. We had no borrowings under this arrangement in 2012. | ||||||||||||||
Aggregate required principal payments on debt outstanding at December 31, 2013, were as follows: | ||||||||||||||
(millions) | ||||||||||||||
Year | Payments | |||||||||||||
2014 | $ | 0 | ||||||||||||
2015 | 0 | |||||||||||||
2016 | 0 | |||||||||||||
2017 | 0 | |||||||||||||
2018 | 0 | |||||||||||||
Thereafter | 1,877.10 | |||||||||||||
Total | $ | 1,877.10 | ||||||||||||
Income_Taxes
Income Taxes | 12 Months Ended | |||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||||||||
Income Taxes | ' | |||||||||||||||||
INCOME TAXES | ||||||||||||||||||
The components of our income tax provision were as follows: | ||||||||||||||||||
(millions) | 2013 | 2012 | 2011 | |||||||||||||||
Current tax provision | $ | 460.2 | $ | 424.8 | $ | 440.2 | ||||||||||||
Deferred tax expense (benefit) | 94.4 | (9.4 | ) | 31.3 | ||||||||||||||
Total income tax provision | $ | 554.6 | $ | 415.4 | $ | 471.5 | ||||||||||||
The provision for income taxes in the accompanying consolidated statements of comprehensive income differed from the statutory rate as follows: | ||||||||||||||||||
($ in millions) | 2013 | 2012 | 2011 | |||||||||||||||
Income before income taxes | $ | 1,720.00 | $ | 1,317.70 | $ | 1,487.00 | ||||||||||||
Tax at statutory rate | $ | 602 | 35 | % | $ | 461.2 | 35 | % | $ | 520.5 | 35 | % | ||||||
Tax effect of: | ||||||||||||||||||
Dividends received deduction | (17.6 | ) | (1 | ) | (18.2 | ) | (1 | ) | (18.2 | ) | (1 | ) | ||||||
Exempt interest income | (13.1 | ) | (1 | ) | (14.7 | ) | (1 | ) | (17.5 | ) | (1 | ) | ||||||
Tax-deductible dividends | (13.6 | ) | (1 | ) | (11.9 | ) | (1 | ) | (3.8 | ) | 0 | |||||||
Tax credits | (2.3 | ) | 0 | 0 | 0 | (9.1 | ) | (1 | ) | |||||||||
Other items, net | (.8 | ) | 0 | (1.0 | ) | 0 | (.4 | ) | 0 | |||||||||
Total income tax provision | $ | 554.6 | 32 | % | $ | 415.4 | 32 | % | $ | 471.5 | 32 | % | ||||||
Deferred income taxes reflect the effect for financial statement reporting purposes of temporary differences between the financial statement carrying amounts and the tax bases of assets and liabilities. At December 31, 2013 and 2012, the components of the net deferred tax asset/liability were as follows: | ||||||||||||||||||
(millions) | 2013 | 2012 | ||||||||||||||||
Deferred tax assets: | ||||||||||||||||||
Unearned premiums reserve | $ | 361 | $ | 344.3 | ||||||||||||||
Investment basis differences | 94.8 | 208.3 | ||||||||||||||||
Non-deductible accruals | 200.7 | 191.6 | ||||||||||||||||
Loss and loss adjustment expense reserves | 92 | 107.3 | ||||||||||||||||
Other | 14.7 | 3.9 | ||||||||||||||||
Deferred tax liabilities: | ||||||||||||||||||
Net unrealized gains on securities | (509.9 | ) | (464.5 | ) | ||||||||||||||
Hedges on forecasted transactions | (2.2 | ) | (3.3 | ) | ||||||||||||||
Deferred acquisition costs | (156.7 | ) | (152.1 | ) | ||||||||||||||
Property and equipment | (99.6 | ) | (103.6 | ) | ||||||||||||||
Prepaid expenses | (14.4 | ) | (12.2 | ) | ||||||||||||||
Deferred gain on extinguishment of debt | (4.8 | ) | (5.8 | ) | ||||||||||||||
Other | (4.0 | ) | (4.5 | ) | ||||||||||||||
Net deferred tax asset (liability) | $ | (28.4 | ) | $ | 109.4 | |||||||||||||
Although realization of the deferred tax assets is not assured, management believes that it is more likely than not that the deferred tax assets will be realized based on our expectation that we will be able to fully utilize the deductions that are ultimately recognized for tax purposes and, therefore, no valuation allowance was needed at December 31, 2013 or 2012. | ||||||||||||||||||
At December 31, 2013, we had $17.1 million of net taxes recoverable (included in other assets on the balance sheet), compared to net taxes payable of $17.9 million at December 31, 2012 (included in other liabilities on the balance sheet). | ||||||||||||||||||
We have been a participant in the Compliance Assurance Program (CAP) since 2007. Under CAP, the Internal Revenue Service (IRS) begins its examination process for the tax year before the tax return is filed, by examining significant transactions and events as they occur. The goal of the CAP program is to expedite the exam process and to reduce the level of uncertainty regarding a taxpayer’s tax filing positions. | ||||||||||||||||||
All federal income tax years prior to 2010 are closed. The IRS exams for 2010-2012 have been completed; therefore, we consider these years to be effectively settled. | ||||||||||||||||||
We recognize interest and penalties, if any, related to unrecognized tax benefits as a component of income tax expense. We have not recorded any unrecognized tax benefits, or any related interest and penalties, as of December 31, 2013 and 2012. For the year ended December 31, 2013, $0.2 million of interest benefit has been recorded in the tax provision. For the years ended December 31, 2012 and 2011, no interest expense or benefit has been recorded in the tax provision. |
Loss_And_Loss_Adjustment_Expen
Loss And Loss Adjustment Expense Reserves | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Loss And Loss Adjustment Expense Reserves | ' | |||||||||
LOSS AND LOSS ADJUSTMENT EXPENSE RESERVES | ||||||||||
Activity in the loss and loss adjustment expense reserves is summarized as follows: | ||||||||||
(millions) | 2013 | 2012 | 2011 | |||||||
Balance at January 1 | $ | 7,838.40 | $ | 7,245.80 | $ | 7,071.00 | ||||
Less reinsurance recoverables on unpaid losses | 862.1 | 785.7 | 704.1 | |||||||
Net balance at January 1 | 6,976.30 | 6,460.10 | 6,366.90 | |||||||
Incurred related to: | ||||||||||
Current year | 12,427.30 | 11,926.00 | 10,876.80 | |||||||
Prior years | 45.1 | 22 | (242.0 | ) | ||||||
Total incurred | 12,472.40 | 11,948.00 | 10,634.80 | |||||||
Paid related to: | ||||||||||
Current year | 8,095.00 | 7,895.30 | 7,289.30 | |||||||
Prior years | 3,919.90 | 3,536.50 | 3,252.30 | |||||||
Total paid | 12,014.90 | 11,431.80 | 10,541.60 | |||||||
Net balance at December 31 | 7,433.80 | 6,976.30 | 6,460.10 | |||||||
Plus reinsurance recoverables on unpaid losses | 1,045.90 | 862.1 | 785.7 | |||||||
Balance at December 31 | $ | 8,479.70 | $ | 7,838.40 | $ | 7,245.80 | ||||
We experienced minimal unfavorable reserve development of $45.1 million and $22.0 million in 2013 and 2012, respectively, compared to favorable development of $242.0 million in 2011, which is reflected as “Incurred related to prior years” in the table above. | ||||||||||
2013 | ||||||||||
• | Approximately 80% of the unfavorable reserve development was attributable to accident year 2011, while the remaining 20% was related to accident year 2012. The aggregate reserve development for accident years 2010 and prior was slightly favorable. | |||||||||
• | About 55% of our unfavorable reserve development was in our Commercial Lines business, with the remainder split about equally between our Personal Lines business and our run-off businesses. In our Personal Lines business, unfavorable development in our Agency auto channel was offset in large part by favorable development in our Direct auto channel. | |||||||||
• | The unfavorable reserve development in our Agency auto business was in our IBNR reserves due to higher frequency and severity on late emerging claims, as primarily reflected in the “all other development.” | |||||||||
• | Lower than anticipated severity costs on case reserves was the primary contributor to the favorable development in our Direct auto business. | |||||||||
• | In our Commercial Lines business, we experienced unfavorable development due to higher frequency and severity on late emerging claims primarily in our bodily injury coverage for our truck business. | |||||||||
• | In our other businesses, we experienced unfavorable development primarily due to reserve increases in our run-off professional liability group business based on recent internal actuarial reviews of our claims history. | |||||||||
2012 | ||||||||||
• | The unfavorable prior year reserve development was primarily attributable to accident year 2011 and to a lesser extent accident year 2010. The aggregate reserve development for accident years 2009 and prior was favorable. Despite overall unfavorable reserve development, we did experience favorable reserve adjustments, primarily in our loss adjustment expenses and our personal auto bodily injury reserves for accident years 2009 and 2008. | |||||||||
• | Slightly more than half of the total unfavorable reserve development was attributable to our Commercial Lines business, with the remainder in our personal auto business. In our personal auto business, unfavorable development in the Agency channel was partially offset by favorable development in the Direct channel, primarily reflecting that unfavorable development on our personal injury protection (PIP) coverage was more skewed to the Agency channel, and that our Direct business had favorable development on our collision coverage, as we experienced more subrogation recoveries in this channel. | |||||||||
• | Our personal auto product’s development was primarily attributable to unfavorable development in our Florida PIP coverage and an increase in our estimate of bodily injury severity for accident year 2011. | |||||||||
• | Unfavorable development in our Commercial Lines business reflects higher than anticipated frequency and severity costs on late emerging claims and higher settlements on large losses. | |||||||||
2011 | ||||||||||
• | About half of the favorable reserve development was attributable to accident years 2008 and prior, while the balance was primarily due to claims from accident year 2010. | |||||||||
• | Approximately 70% of the favorable reserve development was attributable to our Personal Lines business, with our Agency and Direct channels contributing 25% and 75%, respectively; the balance was primarily in our Commercial Lines business. | |||||||||
• | The 2011 favorable development was driven primarily by favorable settlement of larger losses and lower defense and cost containment costs, but was partially offset by unfavorable development on our total IBNR reserves, reflecting a greater than anticipated increase in the number of late emerging claims. | |||||||||
Because we are primarily an insurer of motor vehicles, we have limited exposure to environmental, asbestos, and general liability claims. We have established reserves for such exposures, in amounts that we believe to be adequate based on information currently known. These claims are not expected to have a material effect on our liquidity, financial condition, cash flows, or results of operations. | ||||||||||
We write personal and commercial auto insurance throughout the United States and could be exposed to hurricanes or other catastrophes. Although the occurrence of a major catastrophe could have a significant effect on our monthly or quarterly results, we believe that, based on historical experience, such an event would not be so material as to disrupt the overall normal operations of Progressive. We are unable to predict the frequency or severity of any such events that may occur in the near term or thereafter. |
Reinsurance
Reinsurance | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||
Reinsurance Disclosures [Abstract] | ' | |||||||||||||||||||||||
Reinsurance | ' | |||||||||||||||||||||||
REINSURANCE | ||||||||||||||||||||||||
The effect of reinsurance on premiums written and earned for the years ended December 31, was as follows: | ||||||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||||||
(millions) | Written | Earned | Written | Earned | Written | Earned | ||||||||||||||||||
Direct premiums | $ | 17,562.80 | $ | 17,317.90 | $ | 16,558.80 | $ | 16,207.60 | $ | 15,333.10 | $ | 15,107.50 | ||||||||||||
Ceded | (223.1 | ) | (214.5 | ) | (186.1 | ) | (189.6 | ) | (186.5 | ) | (204.7 | ) | ||||||||||||
Net premiums | $ | 17,339.70 | $ | 17,103.40 | $ | 16,372.70 | $ | 16,018.00 | $ | 15,146.60 | $ | 14,902.80 | ||||||||||||
Our ceded premiums consist of “State Plans” and “Non-State Plans.” State Plans include: (i) amounts ceded to state-provided reinsurance facilities, including the Michigan Catastrophic Claims Association (“MCCA”) and the North Carolina Reinsurance Facility (“NCRF”), and (ii) state-mandated involuntary Commercial Auto Insurance Procedures/Plans (“CAIP”). Collectively, the State Plans accounted for 97%, 98%, and 94% of our ceded premiums for the years ended December 31, 2013, 2012, and 2011, respectively; the MCCA and NCRF together accounted for 77%, 80%, and 80% of the ceded premiums for these same time periods. | ||||||||||||||||||||||||
Losses and loss adjustment expenses were net of reinsurance ceded of $347.0 million in 2013, $230.7 million in 2012, and $219.7 million in 2011. Nearly half of the 2013 increase related to MCCA ceded reserves, while about one-third was on our professional liability group business based on recent internal actuarial reviews of our claims history. | ||||||||||||||||||||||||
Our prepaid reinsurance premiums and reinsurance recoverables were comprised of the following at December 31: | ||||||||||||||||||||||||
Prepaid Reinsurance Premiums | Reinsurance Recoverables | |||||||||||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||
MCCA | $ | 29.5 | 40 | % | $ | 25.4 | 38 | % | $ | 875.9 | 80 | % | $ | 739.2 | 82 | % | ||||||||
CAIP | 21.1 | 28 | 15.4 | 23 | 79.3 | 7 | 66.3 | 7 | ||||||||||||||||
NCRF | 20.5 | 27 | 19.5 | 30 | 50.1 | 5 | 50.6 | 6 | ||||||||||||||||
State Plans | 71.1 | 95 | 60.3 | 91 | 1,005.30 | 92 | 856.1 | 95 | ||||||||||||||||
Non-State Plans | 3.8 | 5 | 6 | 9 | 84.9 | 8 | 44.9 | 5 | ||||||||||||||||
Total | $ | 74.9 | 100 | % | $ | 66.3 | 100 | % | $ | 1,090.20 | 100 | % | $ | 901 | 100 | % | ||||||||
Reinsurance contracts do not relieve us from our obligations to policyholders. Failure of reinsurers to honor their obligations could result in losses to Progressive. Since the majority of our reinsurance is through State Plans, our exposure to losses from their failure is minimal, since the plans are funded by mechanisms supported by the insurance companies in the state. We evaluate the financial condition of our other reinsurers and monitor concentrations of credit risk to minimize our exposure to significant losses from reinsurer insolvencies. |
Statutory_Financial_Informatio
Statutory Financial Information | 12 Months Ended |
Dec. 31, 2013 | |
Statutory Financial Information | ' |
STATUTORY FINANCIAL INFORMATION | |
Consolidated statutory surplus was $5,991.0 million and $5,605.2 million at December 31, 2013 and 2012, respectively. Statutory net income was $1,086.3 million, $808.3 million, and $1,001.7 million for the years ended December 31, 2013, 2012, and 2011, respectively. | |
At December 31, 2013, $524.8 million of consolidated statutory surplus represented net admitted assets of our insurance subsidiaries and affiliate that are required to meet minimum statutory surplus requirements in such entities’ states of domicile. The companies may be licensed in states other than their states of domicile, which may have higher minimum statutory surplus requirements. Generally, the net admitted assets of insurance companies that, subject to other applicable insurance laws and regulations, are available for transfer to the parent company cannot include the net admitted assets required to meet the minimum statutory surplus requirements of the states where the companies are licensed. | |
During 2013, the insurance subsidiaries paid aggregate cash dividends of $1,119.4 million to the parent company. Based on the dividend laws currently in effect, the insurance subsidiaries could pay aggregate dividends of $1,169.7 million in 2014 without prior approval from regulatory authorities, provided the dividend payments are not made within 12 months of previous dividends paid by the applicable subsidiary. |
Employee_Benefit_Plans
Employee Benefit Plans | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Employee Benefit Plans | ' | ||||||||||||||||||||
EMPLOYEE BENEFIT PLANS | |||||||||||||||||||||
Retirement Plans Progressive has a defined contribution pension plan (“401(k) Plan”) that covers most employees who are United States residents and have been employed with the company for at least 30 days. Under this plan, Progressive matches up to a maximum of 6% of an employee’s eligible compensation contributed to the plan. Employee and company matching contributions are invested, at the direction of the employee, in a number of investment options available under the plan, including various mutual funds, a self-directed brokerage option, and a Progressive common stock fund. The Progressive common stock fund is an employee stock ownership program (“ESOP”) within the 401(k) Plan. At December 31, 2013, the ESOP held 26.0 million of our common shares, all of which are included in shares outstanding. Dividends on these shares are reinvested in common shares or paid out in cash at the election of the participant and the related tax benefit is recorded as part of our tax provision. | |||||||||||||||||||||
Matching contributions made by the company for the 401(k) Plan were $69.9 million, $66.5 million, and $64.1 million for the years ended December 31, 2013, 2012, and 2011, respectively. | |||||||||||||||||||||
Postemployment Benefits Progressive provides various postemployment benefits to former or inactive employees who meet eligibility requirements, and to their beneficiaries and covered dependents. Postemployment benefits include salary continuation and disability-related benefits, including workers’ compensation and, if elected, continuation of health-care benefits for specified limited periods. The liability for these benefits was $24.0 million and $22.0 million at December 31, 2013 and 2012, respectively. | |||||||||||||||||||||
Postretirement Benefits We provide postretirement health and life insurance benefits to all employees who met requirements as to age and length of service at December 31, 1988. There are approximately 120 people who are eligible for these postretirement benefits. Our funding policy for these benefits is to contribute annually, to a 501(c)(9) trust, the maximum amount that can be deducted for federal income tax purposes. | |||||||||||||||||||||
Incentive Compensation Plans – Employees Our incentive compensation includes both non-equity incentive plans (cash) and equity incentive plans. Cash incentive compensation includes a cash bonus program for a limited number of senior executives and our Gainsharing program for other employees; the structures of these programs are similar in nature. Equity incentive compensation plans provide for the granting of restricted stock awards and restricted stock unit awards (collectively, “restricted equity awards”) to key members of management. The amounts charged to income for the incentive compensation plans for the years ended December 31, were: | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
(millions) | Pretax | After Tax | Pretax | After Tax | Pretax | After Tax | |||||||||||||||
Cash | $ | 234.5 | $ | 152.4 | $ | 207 | $ | 134.6 | $ | 196.1 | $ | 127.5 | |||||||||
Equity | 64.9 | 42.2 | 63.4 | 41.2 | 50.5 | 32.8 | |||||||||||||||
Our 2003 Incentive Plan, which provides for the granting of equity-based awards to key members of management, has 18.7 million shares currently authorized, net of restricted equity awards canceled. No new awards may be made under the 2003 incentive plan; 1.9 million shares remain available to issue dividend equivalents on outstanding awards. In addition, our 2010 Equity Incentive Plan had 18.0 million shares authorized as of December 31, 2013, and 11.1 million shares remain available for future awards, the reinvestment of dividend equivalents on outstanding awards, and adjustments to performance-based awards reflecting final vesting factors. | |||||||||||||||||||||
We have issued restricted equity awards since 2003. In March 2010, we began issuing restricted stock units in lieu of restricted stock as the basis for our equity awards. The restricted equity awards were issued as either time-based or performance-based awards. The time-based awards vest in equal installments upon the lapse of specified periods of time, typically three, four, and five years. All restricted stock unit conversions at vesting are settled in Progressive common shares from existing treasury shares on a one-to-one basis. | |||||||||||||||||||||
The performance-based awards were granted to our Chief Executive Officer as his sole equity award for 2013, 2012, and 2011, and to approximately 45 executives and senior managers in addition to their time-based awards, to provide additional incentive to achieve pre-established profitability and growth targets. Vesting for all awards is based upon the achievement of predetermined performance goals within specified time periods. The targets for the performance-based awards, as well as the ultimate number of units that may vest, vary by grant. All performance-based awards have a target of 100%. For awards granted in 2013, the maximum award amount for performance-based awards based on insurance results may vest from 0% to 250% . The performance-based awards based on insurance results granted in 2010 through 2012, and all performance awards based on investment results, may vest from 0% to 200% of the award amount. Performance-based awards made prior to March 2009 would either vest or be forfeited in full (i.e., no partial vesting). To the extent performance goals are not achieved within the contractual term, the awards will expire. For awards granted prior to 2009, the maximum contractual term is ten years from the grant date and for awards granted in or after 2009, the maximum contractual term is 5 years from the date of grant. | |||||||||||||||||||||
Generally, time-based and performance-based equity awards are expensed pro rata over their respective vesting periods based on the market value of the awards at the time of grant. Performance-based equity awards that contain variable vesting criteria are expensed based on management’s expected vesting percentage. These estimates can change periodically throughout the measurement period. | |||||||||||||||||||||
A summary of all employee restricted equity award activity during the years ended December 31, follows: | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Restricted Equity Awards | Number of Shares1 | Weighted | Number of | Weighted | Number of | Weighted | |||||||||||||||
Average | Shares1 | Average | Shares1 | Average | |||||||||||||||||
Grant | Grant | Grant | |||||||||||||||||||
Date Fair | Date Fair | Date Fair | |||||||||||||||||||
Value | Value | Value | |||||||||||||||||||
Beginning of year | 11,625,981 | $ | 17.8 | 12,296,847 | $ | 16.86 | 11,681,826 | $ | 16.55 | ||||||||||||
Add (deduct): | |||||||||||||||||||||
Granted2 | 2,738,809 | 22.73 | 2,680,229 | 19.11 | 2,483,461 | 20.03 | |||||||||||||||
Vested | (4,293,605 | ) | 15.54 | (3,188,111 | ) | 15.23 | (1,571,237 | ) | 19.88 | ||||||||||||
Forfeited | (152,610 | ) | 18.28 | (162,984 | ) | 17.93 | (297,203 | ) | 15.41 | ||||||||||||
End of year3,4 | 9,918,575 | $ | 20.13 | 11,625,981 | $ | 17.8 | 12,296,847 | $ | 16.86 | ||||||||||||
Available, end of year5 | 11,139,779 | 15,624,677 | 18,141,922 | ||||||||||||||||||
1 Includes both restricted stock units and restricted stock. Upon vesting, all units will be converted on a one-for-one basis into Progressive common shares funded from existing treasury shares. All performance-based awards are included at their target amounts. | |||||||||||||||||||||
2 In 2010, we began reinvesting dividend equivalents on restricted stock units. For 2013, 2012, and 2011, the number granted includes 161,077, 440,029, and 55,288 units, respectively, at a weighted average grant date fair value of $0, since the dividends were factored into the grant date fair value of the original grant. | |||||||||||||||||||||
3 At December 31, 2013, the number of shares included 2,935,985 performance-based awards at their target amounts. We expect 3,898,809 performance-based awards to vest, based upon our current estimate of the achievement of pre-determined performance goals. | |||||||||||||||||||||
4 At December 31, 2013, the total unrecognized compensation cost related to unvested equity awards was $84.6 million, which includes performance-based awards at their currently estimated vesting value. This compensation expense will be recognized into the income statement over the weighted average vesting period of 2.2 years. | |||||||||||||||||||||
5 Represents shares available under the 2010 Incentive Plan; the 2003 Incentive Plan expired on January 31, 2013, and the remaining 1,898,699 shares thereunder are no longer available for future issuance, however, dividend equivalents will be issued on outstanding awards up to the remaining authorization amount. | |||||||||||||||||||||
The aggregate fair value of the restricted equity awards that vested during the years ended December 31, 2013, 2012, and 2011, was $91.8 million, $57.7 million, and $31.3 million, respectively, based on the actual stock price on the vesting date. In 2013, 272,617 dividend equivalent units vested with no intrinsic value. In 2012, we also had 246,200 deferred liability awards vest with no intrinsic value since these awards were expensed based on the current market value at the end of each reporting period. | |||||||||||||||||||||
The following table is a summary of all employee stock option activity during the year ended December 31, 2011. All non-qualified stock options vested on or before January 1, 2007 and expired on December 31, 2011. All options granted had an exercise price equal to the market value of the common shares on the date of grant. | |||||||||||||||||||||
2011 | |||||||||||||||||||||
Options Outstanding | Number of | Weighted | |||||||||||||||||||
Shares | Average | ||||||||||||||||||||
Exercise | |||||||||||||||||||||
Price | |||||||||||||||||||||
Beginning of year | 1,916,416 | $ | 11.31 | ||||||||||||||||||
Deduct: | |||||||||||||||||||||
Exercised | (1,913,552 | ) | 11.31 | ||||||||||||||||||
Forfeited | (2,864 | ) | 11.28 | ||||||||||||||||||
End of year | 0 | $ | 0 | ||||||||||||||||||
Exercisable, end of year | 0 | $ | 0 | ||||||||||||||||||
The total pretax intrinsic value of options exercised during the year ended December 31, 2011, was $15.2 million, based on the actual stock price at the time of exercise. | |||||||||||||||||||||
Incentive Compensation Plans – Directors Our 2003 Directors Equity Incentive Plan, which provides for the granting of equity-based awards, including restricted stock awards, to non-employee directors of Progressive, had 1.4 million shares authorized as of December 31, 2013, net of restricted stock awards canceled; 0.5 million shares remain available for future restricted stock grants. | |||||||||||||||||||||
We grant restricted stock awards to our non-employee directors as their sole compensation for serving as members of the Board of Directors. We do not plan to change to restricted stock units as we have with our employees. The restricted stock awards are issued as time-based awards. The vesting period (i.e., requisite service period) must be a minimum of six months and one day. The time-based awards granted to date have typically included vesting periods of 11 months from the date of each grant. To the extent a director is newly appointed during the year, or his or her committee assignments change, the vesting period may be shorter but always greater than six months, one day per the plan’s specifications. The restricted stock awards are expensed pro rata over their respective vesting periods based on the market value of the awards at the time of grant. | |||||||||||||||||||||
A summary of all directors’ restricted stock activity during the years ended December 31, follows: | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Restricted Stock | Number of | Weighted | Number of | Weighted | Number of | Weighted | |||||||||||||||
Shares | Average | Shares | Average | Shares | Average | ||||||||||||||||
Grant | Grant | Grant | |||||||||||||||||||
Date Fair | Date Fair | Date Fair | |||||||||||||||||||
Value | Value | Value | |||||||||||||||||||
Beginning of year | 92,957 | $ | 21.41 | 94,106 | $ | 21.8 | 109,545 | $ | 20.86 | ||||||||||||
Add (deduct): | |||||||||||||||||||||
Granted | 93,254 | 26.19 | 92,957 | 21.41 | 94,106 | 21.8 | |||||||||||||||
Vested | (92,957 | ) | 21.41 | (94,106 | ) | 21.8 | (109,545 | ) | 20.86 | ||||||||||||
End of year | 93,254 | $ | 26.19 | 92,957 | $ | 21.41 | 94,106 | $ | 21.8 | ||||||||||||
Available, end of year1 | 476,884 | 570,138 | 663,095 | ||||||||||||||||||
1 Represents shares available under the 2003 Directors Equity Incentive Plan. | |||||||||||||||||||||
Prior to 2003, we granted nonqualified stock options as the equity component of the directors’ compensation. These options became exercisable at various dates not earlier than six months, and remain exercisable for up to ten years from the date of grant. All options granted had an exercise price equal to the market value of the common shares on the date of grant and, under the then applicable accounting guidance, no compensation expense was recorded. All option exercises were settled in Progressive common shares from existing treasury shares. | |||||||||||||||||||||
A summary of all stock option activity for both current and former directors during the years ended December 31, follows: | |||||||||||||||||||||
2012 | 2011 | ||||||||||||||||||||
Options Outstanding | Number of | Weighted | Number of | Weighted | |||||||||||||||||
Shares | Average | Shares | Average | ||||||||||||||||||
Exercise | Exercise | ||||||||||||||||||||
Price | Price | ||||||||||||||||||||
Beginning of year | 36,237 | $ | 12.51 | 120,125 | $ | 10.34 | |||||||||||||||
Deduct: | |||||||||||||||||||||
Exercised | (36,237 | ) | 12.51 | (83,888 | ) | 9.41 | |||||||||||||||
End of year | 0 | $ | 0 | 36,237 | $ | 12.51 | |||||||||||||||
Exercisable, end of year1 | 0 | $ | 0 | 36,237 | $ | 12.51 | |||||||||||||||
1 The 1998 Directors’ Stock Option Plan has expired. | |||||||||||||||||||||
The total pretax intrinsic value of options exercised, and the fair value of the restricted stock vested, during the years ended December 31, 2013, 2012, and 2011, was $2.3 million, $2.5 million, and $3.3 million, respectively, based on the actual stock price at time of exercise/vesting. | |||||||||||||||||||||
Deferred Compensation We maintain The Progressive Corporation Executive Deferred Compensation Plan (“Deferral Plan”) that permits eligible executives to defer receipt of some or all of their annual bonuses and all of their annual equity awards. Deferred cash compensation is deemed invested in one or more investment funds, including common shares of Progressive, offered under the Deferral Plan and elected by the participant. All Deferral Plan distributions attributable to deferred cash compensation will be paid in cash. | |||||||||||||||||||||
For all equity awards granted in or after March 2005, and deferred pursuant to the Deferral Plan, the deferred amounts are deemed invested in common shares and are ineligible for transfer to other investment funds in the Deferral Plan; distributions of these deferred awards will be made in common shares. For all restricted stock awards granted prior to that date, the deferred amounts are eligible to be transferred to any of the investment funds in the Deferral Plan; distributions of these deferred awards will be made in cash. We reserved 11.1 million common shares for issuance under the Deferral Plan. An irrevocable grantor trust has been established to provide a source of funds to assist us in meeting our liabilities under the Deferral Plan. | |||||||||||||||||||||
The Deferral Plan Irrevocable Grantor Trust account held the following assets at December 31: | |||||||||||||||||||||
(millions) | 2013 | 2012 | |||||||||||||||||||
Progressive common shares1 | $ | 57.1 | $ | 53.3 | |||||||||||||||||
Other investment funds2 | 113.1 | 73.4 | |||||||||||||||||||
Total | $ | 170.2 | $ | 126.7 | |||||||||||||||||
1 Includes 2.5 million and 1.3 million common shares as of December 31, 2013 and 2012, respectively, to be distributed in common shares. | |||||||||||||||||||||
2 Amount is included in other assets on the balance sheet. |
Segment_Information
Segment Information | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Segment Information | ' | ||||||||||||||||||||
SEGMENT INFORMATION | |||||||||||||||||||||
We write personal auto and other specialty property-casualty insurance and provide related services throughout the United States. Our Personal Lines segment writes insurance for personal autos and recreational vehicles. The Personal Lines segment is comprised of both the Agency and Direct businesses. The Agency business includes business written by our network of more than 35,000 independent insurance agencies, including brokerages in New York and California, and strategic alliance business relationships (other insurance companies, financial institutions, and national agencies). The Direct business includes business written directly by us online, by phone, or on mobile devices. We also sell personal auto physical damage insurance via the Internet in Australia. For the years ended December 31, 2013, 2012, and 2011, net premiums earned on our Australian business were $13.0 million, $7.1 million, and $3.5 million, respectively. | |||||||||||||||||||||
Our Commercial Lines segment writes primary liability and physical damage insurance for automobiles and trucks owned and/or operated predominantly by small businesses in the business auto, for-hire transportation, contractor, for-hire specialty, and tow markets. This segment is distributed through both the independent agency and direct channels. | |||||||||||||||||||||
Our other indemnity businesses manage our run-off businesses, including the run-off of our professional liability insurance for community banks, which was sold in 2010. | |||||||||||||||||||||
Our service businesses provide insurance-related services, including processing CAIP business and serving as an agent for homeowners, general liability, and workers’ compensation insurance through our programs with unaffiliated insurance companies. | |||||||||||||||||||||
All segment revenues are generated from external customers and we do not have a reliance on any major customer. | |||||||||||||||||||||
We evaluate profitability based on pretax underwriting profit (loss) for the Personal Lines and Commercial Lines segments and for the other indemnity businesses. Pretax underwriting profit (loss) is calculated as net premiums earned plus fees and other revenues less each of: (i) losses and loss adjustment expenses; (ii) policy acquisition costs; and (iii) other underwriting expenses. Service business pretax profit (loss) is the difference between service business revenues and service business expenses. | |||||||||||||||||||||
Expense allocations are based on certain assumptions and estimates primarily related to revenue and volume; stated segment operating results would change if different methods were applied. We do not allocate assets or income taxes to operating segments. In addition, we do not separately identify depreciation and amortization expense by segment, and such allocation would be impractical. Companywide depreciation expense was $101.3 million in 2013, $94.4 million in 2012, and $88.5 million in 2011. The accounting policies of the operating segments are the same as those described in Note 1 - Reporting and Accounting Policies. | |||||||||||||||||||||
Following are the operating results for the years ended December 31: | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
(millions) | Revenues | Pretax | Revenues | Pretax | Revenues | Pretax | |||||||||||||||
Profit | Profit | Profit | |||||||||||||||||||
(Loss) | (Loss) | (Loss) | |||||||||||||||||||
Personal Lines | |||||||||||||||||||||
Agency | $ | 8,601.50 | $ | 542.9 | $ | 8,103.90 | $ | 338.9 | $ | 7,627.40 | $ | 564.9 | |||||||||
Direct | 6,740.10 | 473.9 | 6,264.20 | 289.5 | 5,803.70 | 354.4 | |||||||||||||||
Total Personal Lines1 | 15,341.60 | 1,016.80 | 14,368.10 | 628.4 | 13,431.10 | 919.3 | |||||||||||||||
Commercial Lines | 1,761.60 | 114.1 | 1,649.00 | 86.3 | 1,467.10 | 133.5 | |||||||||||||||
Other indemnity | 0.2 | (10.8 | ) | 0.9 | (5.8 | ) | 4.6 | (5.5 | ) | ||||||||||||
Total underwriting operations | 17,103.40 | 1,120.10 | 16,018.00 | 708.9 | 14,902.80 | 1,047.30 | |||||||||||||||
Fees and other revenues2 | 291.8 | NA | 281.8 | NA | 266.5 | NA | |||||||||||||||
Service businesses | 39.6 | 0.8 | 36.1 | 0 | 22.8 | 3.4 | |||||||||||||||
Investments3 | 740.4 | 721.6 | 749.8 | 734.4 | 582.6 | 569.1 | |||||||||||||||
Gains (losses) on extinguishment of debt | (4.3 | ) | (4.3 | ) | (1.8 | ) | (1.8 | ) | (.1 | ) | (.1 | ) | |||||||||
Interest expense | NA | (118.2 | ) | NA | (123.8 | ) | NA | (132.7 | ) | ||||||||||||
Consolidated total | $ | 18,170.90 | $ | 1,720.00 | $ | 17,083.90 | $ | 1,317.70 | $ | 15,774.60 | $ | 1,487.00 | |||||||||
1 Personal auto insurance accounted for 91% of the total Personal Lines segment net premiums earned in 2013, 2012, and 2011; insurance for our special lines products (e.g., motorcycles, ATVs, RVs, mobile homes, watercraft, and snowmobiles) accounted for the balance of the Personal Lines net premiums earned. | |||||||||||||||||||||
2 Pretax profit (loss) for fees and other revenues are allocated to operating segments. | |||||||||||||||||||||
3 Revenues represent recurring investment income and total net realized gains (losses) on securities; pretax profit is net of investment expenses. | |||||||||||||||||||||
NA =font> Not Applicable | |||||||||||||||||||||
Progressive’s management uses underwriting margin and combined ratio as primary measures of underwriting profitability. Underwriting profitability is calculated by subtracting losses and loss adjustment expenses, policy acquisition costs, and other underwriting expenses from the total of net premiums earned and fees and other revenues. The underwriting margin is the pretax underwriting profit (loss) expressed as a percentage of net premiums earned (i.e., revenues from underwriting operations). Combined ratio is the complement of the underwriting margin. Following are the underwriting margins/combined ratios for our underwriting operations for the years ended December 31: | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Underwriting | Combined | Underwriting | Combined | Underwriting | Combined | ||||||||||||||||
Margin | Ratio | Margin | Ratio | Margin | Ratio | ||||||||||||||||
Personal Lines | |||||||||||||||||||||
Agency | 6.3 | % | 93.7 | 4.2 | % | 95.8 | 7.4 | % | 92.6 | ||||||||||||
Direct | 7 | 93 | 4.6 | 95.4 | 6.1 | 93.9 | |||||||||||||||
Total Personal Lines | 6.6 | 93.4 | 4.4 | 95.6 | 6.8 | 93.2 | |||||||||||||||
Commercial Lines | 6.5 | 93.5 | 5.2 | 94.8 | 9.1 | 90.9 | |||||||||||||||
Other indemnity1 | NM | NM | NM | NM | NM | NM | |||||||||||||||
Total underwriting operations | 6.5 | 93.5 | 4.4 | 95.6 | 7 | 93 | |||||||||||||||
1 Underwriting margins/combined ratios are not meaningful (NM) for our other indemnity businesses due to the low level of premiums earned by, and the variability of loss costs in, such businesses. |
Other_Comprehensive_Income_Los
Other Comprehensive Income (Loss) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||
Other Comprehensive Income (Loss) | ' | |||||||||||||||||||||||
OTHER COMPREHENSIVE INCOME (LOSS) | ||||||||||||||||||||||||
The components of other comprehensive income (loss) for the years ended December 31, were as follows: | ||||||||||||||||||||||||
Components of Changes in | ||||||||||||||||||||||||
Accumulated Other | ||||||||||||||||||||||||
Comprehensive Income (after tax) | ||||||||||||||||||||||||
(millions) | Pretax total | Total tax | After tax total | Total net | Net | Foreign | ||||||||||||||||||
accumulated | (provision) | accumulated | unrealized | unrealized | currency | |||||||||||||||||||
other | benefit | other | gains (losses) | gains on | translation | |||||||||||||||||||
comprehensive | comprehensive | on securities | forecasted | adjustment | ||||||||||||||||||||
income | income | transactions1,3 | ||||||||||||||||||||||
Balance at December 31, 2012 | $ | 1,340.00 | $ | (469.0 | ) | $ | 871 | $ | 862.7 | $ | 6.1 | $ | 2.2 | |||||||||||
Other comprehensive income (loss) before reclassifications: | ||||||||||||||||||||||||
Investment securities | 368.2 | (128.9 | ) | 239.3 | 239.3 | 0 | 0 | |||||||||||||||||
Net non-credit related OTTI losses, adjusted for valuation changes | 0.4 | (.1 | ) | 0.3 | 0.3 | 0 | 0 | |||||||||||||||||
Forecasted transactions | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Foreign currency translation adjustment | (2.5 | ) | 0.9 | (1.6 | ) | 0 | 0 | (1.6 | ) | |||||||||||||||
Total other comprehensive income (loss) before reclassifications | 366.1 | (128.1 | ) | 238 | 239.6 | 0 | (1.6 | ) | ||||||||||||||||
Less: Reclassification adjustment for amounts realized in net income by income statement line item: | ||||||||||||||||||||||||
Net impairment losses recognized in earnings | (5.7 | ) | 2 | (3.7 | ) | (3.7 | ) | 0 | 0 | |||||||||||||||
Net realized gains (losses) on securities2 | 245.5 | (86.0 | ) | 159.5 | 159 | 0.5 | 0 | |||||||||||||||||
Interest expense3 | 2.2 | (.7 | ) | 1.5 | 0 | 1.5 | 0 | |||||||||||||||||
Total reclassification adjustment for amounts realized in net income | 242 | (84.7 | ) | 157.3 | 155.3 | 2 | 0 | |||||||||||||||||
Total other comprehensive income (loss) | 124.1 | (43.4 | ) | 80.7 | 84.3 | (2.0 | ) | (1.6 | ) | |||||||||||||||
Balance at December 31, 2013 | $ | 1,464.10 | $ | (512.4 | ) | $ | 951.7 | $ | 947 | $ | 4.1 | $ | 0.6 | |||||||||||
Components of Changes in | ||||||||||||||||||||||||
Accumulated Other | ||||||||||||||||||||||||
Comprehensive Income (after tax) | ||||||||||||||||||||||||
(millions) | Pretax total | Total tax | After tax total | Total net | Net | Foreign | ||||||||||||||||||
accumulated | (provision) | accumulated | unrealized | unrealized | currency | |||||||||||||||||||
other | benefit | other | gains (losses) | gains on | translation | |||||||||||||||||||
comprehensive | comprehensive | on securities | forecasted | adjustment | ||||||||||||||||||||
income | income | transactions1 | ||||||||||||||||||||||
Balance at December 31, 2011 | $ | 1,065.40 | $ | (372.9 | ) | $ | 692.5 | $ | 682.8 | $ | 7.9 | $ | 1.8 | |||||||||||
Other comprehensive income (loss) before reclassifications: | ||||||||||||||||||||||||
Investment securities | 488 | (170.8 | ) | 317.2 | 317.2 | 0 | 0 | |||||||||||||||||
Net non-credit related OTTI losses, adjusted for valuation changes | 7.9 | (2.8 | ) | 5.1 | 5.1 | 0 | 0 | |||||||||||||||||
Forecasted transactions | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Foreign currency translation adjustment | 0.6 | (.2 | ) | 0.4 | 0 | 0 | 0.4 | |||||||||||||||||
Total other comprehensive income (loss) before reclassifications | 496.5 | (173.8 | ) | 322.7 | 322.3 | 0 | 0.4 | |||||||||||||||||
Less: Reclassification adjustment for amounts realized in net income by income statement line item: | ||||||||||||||||||||||||
Net impairment losses recognized in earnings | (.4 | ) | 0.1 | (.3 | ) | (.3 | ) | 0 | 0 | |||||||||||||||
Net realized gains (losses) on securities2 | 220.1 | (77.0 | ) | 143.1 | 142.7 | 0.4 | 0 | |||||||||||||||||
Interest expense | 2.2 | (.8 | ) | 1.4 | 0 | 1.4 | 0 | |||||||||||||||||
Total reclassification adjustment for amounts realized in net income | 221.9 | (77.7 | ) | 144.2 | 142.4 | 1.8 | 0 | |||||||||||||||||
Total other comprehensive income (loss) | 274.6 | (96.1 | ) | 178.5 | 179.9 | (1.8 | ) | 0.4 | ||||||||||||||||
Balance at December 31, 2012 | $ | 1,340.00 | $ | (469.0 | ) | $ | 871 | $ | 862.7 | $ | 6.1 | $ | 2.2 | |||||||||||
Components of Changes in | ||||||||||||||||||||||||
Accumulated Other | ||||||||||||||||||||||||
Comprehensive Income (after tax) | ||||||||||||||||||||||||
(millions) | Pretax total | Total tax | After tax total | Total net | Net | Foreign | ||||||||||||||||||
accumulated | (provision) | accumulated | unrealized | unrealized | currency | |||||||||||||||||||
other | benefit | other | gains (losses) | gains on | translation | |||||||||||||||||||
comprehensive | comprehensive | on securities | forecasted | adjustment | ||||||||||||||||||||
income | income | transactions1 | ||||||||||||||||||||||
Balance at December 31, 2010 | $ | 1,205.60 | $ | (421.9 | ) | $ | 783.7 | $ | 767.3 | $ | 14.7 | $ | 1.7 | |||||||||||
Other comprehensive income (loss) before reclassifications: | ||||||||||||||||||||||||
Investment securities | 75.4 | (26.4 | ) | 49 | 49 | 0 | 0 | |||||||||||||||||
Net non-credit related OTTI losses, adjusted for valuation changes | (5.5 | ) | 1.9 | (3.6 | ) | (3.6 | ) | 0 | 0 | |||||||||||||||
Forecasted transactions | (5.1 | ) | 1.8 | (3.3 | ) | 0 | (3.3 | ) | 0 | |||||||||||||||
Foreign currency translation adjustment | 0.2 | (.1 | ) | 0.1 | 0 | 0 | 0.1 | |||||||||||||||||
Total other comprehensive income (loss) before reclassifications | 65 | (22.8 | ) | 42.2 | 45.4 | (3.3 | ) | 0.1 | ||||||||||||||||
Less: Reclassification adjustment for amounts realized in net income by income statement line item: | ||||||||||||||||||||||||
Net impairment losses recognized in earnings | (.6 | ) | 0.2 | (.4 | ) | (.4 | ) | 0 | 0 | |||||||||||||||
Net realized gains (losses) on securities2 | 200.8 | (70.3 | ) | 130.5 | 130.3 | 0.2 | 0 | |||||||||||||||||
Interest expense | 5 | (1.7 | ) | 3.3 | 0 | 3.3 | 0 | |||||||||||||||||
Total reclassification adjustment for amounts realized in net income | 205.2 | (71.8 | ) | 133.4 | 129.9 | 3.5 | 0 | |||||||||||||||||
Total other comprehensive income (loss) | (140.2 | ) | 49 | (91.2 | ) | (84.5 | ) | (6.8 | ) | 0.1 | ||||||||||||||
Balance at December 31, 2011 | $ | 1,065.40 | $ | (372.9 | ) | $ | 692.5 | $ | 682.8 | $ | 7.9 | $ | 1.8 | |||||||||||
1 Entered into for the purpose of managing interest rate risk associated with our debt issuances. | ||||||||||||||||||||||||
2 During 2013, 2012, and 2011, we reclassified $0.8 million, $0.6 million, and $0.3 million, respectively, on a pretax basis, from accumulated other comprehensive income on the balance sheet to net realized gains on securities on the comprehensive income statement, reflecting the portion of the unrealized gain on forecasted transactions that was related to the portion of the 6.70% Debentures repurchased during the periods (see Note 4 – Debt for further discussion). | ||||||||||||||||||||||||
3 We expect to reclassify $2.1 million (pretax) into income during the next 12 months, related to net unrealized gains on forecasted transactions. |
Litigation
Litigation | 12 Months Ended | |
Dec. 31, 2013 | ||
Litigation Disclosures [Abstract] | ' | |
Litigation | ' | |
LITIGATION | ||
The Progressive Corporation and/or its insurance subsidiaries are named as defendants in various lawsuits arising out of claims made under insurance policies written by our insurance subsidiaries in the ordinary course of business. We consider all legal actions relating to such claims in establishing our loss and loss adjustment expense reserves. | ||
In addition, The Progressive Corporation and/or its insurance subsidiaries are named as defendants in a number of class action or individual lawsuits arising out of the operations of the insurance subsidiaries. Other insurance companies face many of these same issues. The lawsuits discussed below are in various stages of development. We plan to contest these suits vigorously, but may pursue settlement negotiations in some cases, if appropriate. The outcomes of pending cases are uncertain at this time. | ||
We establish accruals for lawsuits when it is probable that a loss has been or will be incurred and we can reasonably estimate its potential exposure, which may include a range of loss (referred to as a loss that is both “probable and estimable” in the discussion below). As to lawsuits in which the loss is not considered both probable and estimable, or is considered probable but not estimable, we do not establish an accrual in accordance with current accounting guidance. It is generally not possible to determine the exposure associated with our lawsuits for a number of reasons, including, without limitation, one or more of the following: liability appears to be remote; putative class action lawsuits generally pose immaterial exposure until a class is actually certified, which, historically, has not been granted by the courts in the vast majority of our cases in which certification has been sought; class definitions are often indefinite and preclude detailed exposure analysis; and complaints rarely state an amount sought as relief, and when such amount is stated, it is often a function of pleading requirements and may be unrelated to the potential exposure. The following is a discussion of potentially significant pending cases at December 31, 2013, and certain cases resolved during the three-year period then ended. | ||
As to the pending cases, although their outcomes are uncertain, in each case we do not believe that the outcome will have a material impact on our consolidated financial condition, cash flows, or results of operations. In addition, we do not consider the losses from the pending cases to be both probable and estimable (except as noted below), and we are unable to estimate a range of loss, if any, at this time, due to the factors discussed above. In the event that any one or more of these cases results in a substantial judgment against, or settlement by, Progressive, or if our accruals prove to be inadequate, the resulting liability could have a material effect on our consolidated financial condition, cash flows, and/or results of operations. | ||
Pending cases at December 31, 2013 that challenge certain of our insurance subsidiaries' practices, include: | ||
• | One certified class action lawsuit seeking interest on PIP payments that allegedly were late. | |
• | Two putative class action lawsuits alleging that Progressive’s denial of claims under collision coverage is improper by its interpretation of the duplicate recovery provision when the insured has not recovered all losses from another insurer, such as attorney fees. | |
• | One putative class action lawsuit alleging that Progressive’s website did not adequately disclose sufficient information concerning the PIP deductibles when customers indicated they are covered by private health insurance. | |
• | Two putative class action lawsuits challenging the labor rates our insurance subsidiaries pay to auto body repair shops. | |
• | One patent matter alleging that Progressive infringes on patented marketing technology. | |
• | One putative class action lawsuit alleging that Progressive steers customers to Service Centers and network shops to have their vehicles repaired. | |
• | Four putative class action lawsuits challenging Progressive’s practice in Florida of adjusting PIP and first-party medical payments. | |
• | Three putative class action lawsuits challenging our adjustment of medical bills submitted by insureds in bodily injury claims. | |
• | One putative class action lawsuit challenging our policy form with regard to rejecting uninsured motorist coverage. We have established an accrual for this matter because it is probable that a loss has been incurred on this lawsuit and we were able to estimate a loss. The case is ongoing and a settlement has not been reached. The amount of the accrual is not material to our consolidated financial condition, cash flows, or results of operations. | |
• | One putative class action lawsuit challenging the manner in which Progressive grants a discount for anti-theft devices. | |
• | Two putative class action lawsuits alleging that Progressive charged insureds for illusory uninsured motorist/underinsured motorist coverage. | |
• | One putative class action lawsuit alleging that Progressive undervalues total loss claims through the use of certain valuation tools. | |
• | One putative class action lawsuit alleging that Progressive applied auto insurance premium increases at double the approved rate increases. | |
• | One putative class action lawsuit alleging that Progressive negligently designed, manufactured, and deceptively advertised Snapshot® in that it purportedly drains a vehicle's battery to the point that the battery is non-functional or diminished in value. | |
• | One putative class action lawsuit alleging that Progressive violated the Telephone Consumer Protection Act in making cell phone calls to insureds. | |
• | One putative class action lawsuit alleging that Progressive fails to secure new waivers of stacking forms when additional vehicles are added to an auto or motorcycle policy and fails to make payment of stacked underinsured motorist benefits in an amount which is fair and reasonable. | |
• | One putative federal collective and state class action lawsuit challenging our exempt employee classification for certain claims employees under the federal Fair Labor Standards Act and/or state law. | |
For cases that have settled, but for which settlement is not complete, an accrual has been established at our best estimate of the exposure. Settlements that are complete are fully reflected in our financial statements. The amounts accrued or paid for these settlements were not material to our consolidated financial condition, cash flows, or results of operations. | ||
Cases settled during 2013 include: | ||
• | One putative class action lawsuit alleging that Progressive did not reimburse any of its insureds who incurred legal fees to recover money from another Progressive insured. This case was accrued for, settled, and paid in 2013. | |
• | One putative class action lawsuit alleging that Progressive improperly applies a preferred provider discount to medical payment claims. This case was accrued for and settled in 2013. | |
• | One putative class action lawsuit challenging the manner in which Progressive charges premium and assesses total loss claims for commercial vehicle stated amount policies. This case was accrued for, settled, and paid in 2013. | |
• | Two putative class action lawsuits challenging Progressive’s practice in Florida of adjusting PIP and first-party medical payments. Both cases were settled on an individual basis. | |
Cases settled during 2012 include: | ||
• | One putative class action lawsuit that challenged Progressive’s use of certain automated database vendors or software to assist in the adjustment of bodily injury claims where the plaintiffs alleged that these databases or software systematically undervalued the claims; an accrual was established during 2012, and the case was paid in 2013. | |
Cases settled during 2011 include: | ||
• | One putative class action lawsuit that challenged the labor rates our insurance subsidiaries paid to auto body repair shops; the case was settled and paid on an individual basis in 2011. | |
• | One class action lawsuit certified for settlement that alleged Progressive charged insureds for illusory uninsured motorist/underinsured motorist coverage on multiple vehicle policies; an accrual was established in 2012 and the majority of this settlement was paid in 2012 with the remainder paid in 2013. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Commitments and Contingencies | ' | |||
COMMITMENTS AND CONTINGENCIES | ||||
We have certain noncancelable operating lease commitments with lease terms greater than one year for property and computer equipment. The minimum commitments under these agreements at December 31, 2013, were as follows: | ||||
(millions) | Commitments | |||
2014 | $ | 46 | ||
2015 | 38.2 | |||
2016 | 27.6 | |||
2017 | 16.1 | |||
2018 | 9.5 | |||
Thereafter | 7.2 | |||
Total | $ | 144.6 | ||
Some of the leases have options to renew at the end of the lease periods. The expense we incurred for the leases disclosed above, as well as other operating leases that may be cancelable or have terms less than one year, was: | ||||
(millions) | Expense | |||
2013 | $ | 64.6 | ||
2012 | 71.9 | |||
2011 | 80.8 | |||
We also have certain noncancelable purchase obligations. The minimum commitment under these agreements at December 31, 2013, was $215.3 million. | ||||
As of December 31, 2013, we had no open investment funding commitments; we had no uncollateralized lines or letters of credit as of December 31, 2013 or 2012. |
Dividends
Dividends | 12 Months Ended |
Dec. 31, 2013 | |
Dividends [Abstract] | ' |
Dividends | ' |
DIVIDENDS | |
We maintain a policy of paying an annual variable dividend that, if declared, would be payable shortly after the close of the year. This annual variable dividend is based on a target percentage of after-tax underwriting income multiplied by a companywide performance factor (“Gainshare factor”), subject to the limitations discussed below. The target percentage is determined by our Board of Directors on an annual basis and announced to shareholders and the public. For 2013, the Board determined the target percentage to be 33-1/3% of annual after-tax underwriting income, which is unchanged from the target percentage in both 2012 and 2011. | |
The Gainshare factor can range from zero to two and is determined by comparing our operating performance for the year to certain predetermined profitability and growth objectives approved by the Compensation Committee of the Board. This Gainshare factor is also used in the annual cash bonus program currently in place for our employees (our “Gainsharing program”). Although recalibrated every year, the structure of the Gainsharing program generally remains the same. For 2013, the Gainshare factor was 1.21, compared to 1.12 in 2012 and 1.10 in 2011. | |
Our annual dividend program will result in a variable payment to shareholders each year, subject to certain limitations. If the Gainshare factor is zero or if our comprehensive income is less than after-tax underwriting income, no dividend would be payable under our annual variable dividend policy. However, the ultimate decision on whether or not a dividend will be paid is in the discretion of the Board of Directors. The Board could decide to alter our policy, or not to pay the annual variable dividend for future years, at any time prior to the declaration of the dividend for the year. Such an action by the Board could result from, among other reasons, changes in the insurance marketplace, changes in our performance or capital needs, changes in federal income tax laws, disruptions of national or international capital markets, or other events affecting our business, liquidity, or financial position. | |
In December 2013, the Board of Directors declared an annual variable dividend, which was paid in February 2014 to shareholders of record at the close of business on January 29, 2014. The amount of the dividend was $.4929 per common share, or $293.9 million. The 2012 annual variable dividend was declared by the Board in December 2012 and paid to shareholders in February 2013; the total amount of dividends was $172.0 million, or $.2845 per common share. The 2011 annual variable dividend was declared by the Board in December 2011 and paid to shareholders in February 2012; the total amount of dividends was $249.4 million, or $.4072 per common share. | |
In addition to the annual variable dividend, in February 2014 (declared in December 2013) and November 2012 (declared in October 2012), we returned $596.3 million and $604.7 million, respectively, to shareholders via special cash dividends of $1.00 per share each. |
Reporting_And_Accounting_Polic1
Reporting And Accounting Policies (Policies) | 12 Months Ended | |
Dec. 31, 2013 | ||
Nature of Operations | ' | |
Nature of Operations The Progressive Corporation, an insurance holding company formed in 1965, had 54 subsidiaries, 1 mutual insurance company affiliate, and 1 limited partnership investment affiliate (collectively the “subsidiaries”) as of December 31, 2013. Our insurance subsidiaries and mutual company affiliate (the Progressive Group of Insurance Companies) provide personal and commercial automobile insurance and other specialty property-casualty insurance and related services. Our Personal Lines segment writes insurance for personal autos and recreational vehicles through both an independent insurance agency channel and a direct channel. Our Commercial Lines segment writes primary liability and physical damage insurance for automobiles and trucks owned and/or operated predominantly by small businesses through both the independent agency and direct channels. We operate our businesses throughout the United States; we also sell personal auto physical damage insurance via the Internet in Australia. | ||
Consolidation Policy | ' | |
Basis of Consolidation and Reporting The accompanying consolidated financial statements include the accounts of The Progressive Corporation, its subsidiaries, which are wholly owned, and affiliates, in which we have a controlling financial interest. All intercompany accounts and transactions are eliminated in consolidation. | ||
Estimates And Assumptions Policy | ' | |
Estimates We are required to make estimates and assumptions when preparing our financial statements and accompanying notes in conformity with accounting principles generally accepted in the United States of America (GAAP). As estimates develop into fact (e.g., losses are paid), results may, and will likely, differ from those estimates. | ||
Investment Policy | ' | |
Investments Progressive’s fixed-maturity securities, equity securities, and short-term investments are accounted for on an available-for-sale basis. See Note 2 – Investments for details regarding the composition of our investment portfolio. | ||
Fixed-maturity securities include debt securities and redeemable preferred stocks, which may have fixed or variable principal payment schedules, may be held for indefinite periods of time, and may be used as a part of our asset/liability strategy or sold in response to changes in interest rates, anticipated prepayments, risk/reward characteristics, liquidity needs, or other economic factors. These securities are carried at fair value with the corresponding unrealized gains (losses), net of deferred income taxes, reported in accumulated other comprehensive income. Fair values are obtained from recognized pricing services or are quoted by market makers and dealers, with limited exceptions discussed in Note 3 – Fair Value. | ||
Included in the fixed-maturity portfolio are asset-backed securities. The asset-backed securities are generally accounted for under the retrospective method. The retrospective method recalculates yield assumptions (based on changes in interest rates or cash flow expectations) historically to the inception of the investment holding period, and applies the required adjustment, if any, to the cost basis, with the offset recorded to investment income. The prospective method is used primarily for interest-only securities, non-investment-grade asset-backed securities, and certain asset-backed securities with sub-prime loan exposure or where there is a greater risk of non-performance and where it is possible the initial investment may not be substantially recovered. The prospective method requires a calculation of future expected repayments and resets the yield to allow for future period adjustments; no current period impact to investment income or the security’s cost is made based on the cash flow update. Prepayment assumptions are based on market expectations and are updated quarterly. | ||
Equity securities include common stocks, nonredeemable preferred stocks, and other risk investments and are reported at fair values. Changes in fair value of these securities, net of deferred income taxes, are reflected as unrealized gains (losses) in accumulated other comprehensive income. To the extent we hold any foreign equities or foreign currency hedges, any change in value due to exchange rate fluctuations would be limited by foreign currency hedges, if any, and would be recognized in income in the current period. | ||
Short-term investments may include Eurodollar deposits, commercial paper, repurchase transactions, and other securities expected to mature within one year. In addition, short-term investments can include auction rate securities (i.e., certain municipal bonds and preferred stocks). Due to the nature of auction rate securities, these securities are classified as short-term based upon their expected auction date (generally 7-49 days) rather than on their contractual maturity date (which is greater than one year at original issuance). In the event that an auction fails, the security may need to be reclassified from short-term. Changes in fair value of these securities, net of deferred income taxes, are reflected as unrealized gains (losses) in accumulated other comprehensive income. | ||
Trading securities are securities bought principally for the purpose of sale in the near term. To the extent we have trading securities, changes in fair value would be recognized in income in the current period. Derivative instruments, which may be used for trading purposes or classified as trading derivatives due to the characteristics of the transaction, are discussed below. | ||
Derivative instruments may include futures, options, forward positions, foreign currency forwards, interest rate swap agreements, and credit default swaps and may be used in the portfolio for general investment purposes or to hedge the exposure to: | ||
• | Changes in fair value of an asset or liability (fair value hedge) | |
• | Foreign currency of an investment in a foreign operation (foreign currency hedge), or | |
• | Variable cash flows of a forecasted transaction (cash flow hedge). | |
To the extent we have derivatives held for general investment purposes, these derivative instruments are recognized as either assets or liabilities and measured at fair value, with changes in fair value recognized in income as a component of net realized gains (losses) on securities during the period of change. | ||
Derivatives designated as hedges are required to be evaluated on established criteria to determine the effectiveness of their correlation to, and ability to reduce the designated risk of, specific securities or transactions. Effectiveness is required to be reassessed regularly. Hedges that are deemed to be effective would be accounted for as follows: | ||
• | Fair value hedge: changes in fair value of the hedge, as well as the hedged item, would be recognized in income in the period of change while the hedge is in effect. | |
• | Foreign currency hedge: changes in fair value of the hedge, as well as the hedged item, would be reflected as a change in translation adjustment as part of accumulated other comprehensive income. Gains and losses on the foreign currency hedge would offset the foreign exchange gains and losses on the foreign investment as they are recognized into income. | |
• | Cash flow hedge: changes in fair value of the hedge would be reported as a component of accumulated other comprehensive income and subsequently amortized into earnings over the life of the hedged transaction. | |
If a hedge is deemed to become ineffective or discontinued, the following accounting treatment would be applied: | ||
• | Fair value hedge: the derivative instrument would continue to be adjusted through income, while the adjustment in the change in value of the hedged item would be reflected as a change in unrealized gains (losses) as part of accumulated other comprehensive income. | |
• | Foreign currency hedge: changes in the value of the hedged item would continue to be reflected as a change in translation adjustment as part of accumulated other comprehensive income, but the derivative instrument would be adjusted through income for the current period. | |
• | Cash flow hedge: changes in fair value of the derivative instrument would be reported in income for the current period. | |
For all derivative positions, net cash requirements are limited to changes in fair values, which may vary based upon changes in interest rates, currency exchange rates, and other factors. Exposure to credit risk is limited to the carrying value; collateral may be required to limit credit risk. We have elected not to offset fair value amounts that arise from derivative positions with the same counterparty under a master netting arrangement. | ||
Investment securities are exposed to various risks such as interest rate, market, credit, and liquidity risk. Fair values of securities fluctuate based on the nature and magnitude of changing market conditions; significant changes in market conditions could materially affect the portfolio’s value in the near term. We regularly monitor our portfolio for price changes, which might indicate potential impairments, and perform detailed reviews of securities with unrealized losses. In such cases, changes in fair value are evaluated to determine the extent to which such changes are attributable to: (i) fundamental factors specific to the issuer, such as financial condition, business prospects, or other factors, (ii) market-related factors, such as interest rates or equity market declines, or (iii) credit-related losses, where the present value of cash flows expected to be collected are lower than the amortized cost basis of the security. | ||
We analyze our debt securities that are in a loss position to determine if we intend to sell, or if it is more likely than not that we will be required to sell, the security prior to recovery and, if so, we write down the security to its current fair value, with the entire amount of the write-down recorded to earnings. To the extent that it is more likely than not that we will hold the debt security until recovery (which could be maturity), we determine if any of the decline in value is due to a credit loss (i.e., where the present value of future cash flows expected to be collected is lower than the amortized cost basis of the security) and, if so, we recognize that portion of the impairment as a component of net realized gains (losses) in the comprehensive income statement, with the difference (i.e., non-credit related impairment) recognized as part of our net unrealized gains (losses) in accumulated other comprehensive income. When an equity security (common equity and nonredeemable preferred stock) in our investment portfolio has an unrealized loss in fair value that is deemed to be other-than-temporary, we reduce the book value of such security to its current fair value, recognizing the decline as a realized loss in the comprehensive income statement. Any future changes in fair value, either increases or decreases, are reflected as changes in unrealized gains (losses) as part of accumulated other comprehensive income. | ||
Investment income consists of interest and dividends. In addition to the discussion above for asset-backed securities, interest is recognized on an accrual basis using the effective yield method. Depending on the nature of the equity instruments, dividends are recorded at either the ex-dividend date or on an accrual basis. | ||
Realized gains (losses) on securities are computed based on the first-in first-out method and include write-downs on available-for-sale securities considered to have other-than-temporary declines in fair value (excluding non-credit related impairments), as well as holding period valuation changes on derivatives, trading securities, and hybrid instruments (e.g., securities with embedded options, where the option is a feature of the overall change in the value of the instrument). | ||
Insurance Premiums and Receivables Policy | ' | |
Insurance Premiums and Receivables Insurance premiums written are earned into income on a pro rata basis over the period of risk, based on a daily earnings convention. Accordingly, unearned premiums represent the portion of premiums written that are applicable to the unexpired risk. We provide insurance and related services to individuals and small commercial accounts and offer a variety of payment plans. Generally, premiums are collected prior to providing risk coverage, minimizing our exposure to credit risk. We perform a policy level evaluation to determine the extent to which the premiums receivable balance exceeds the unearned premiums balance. We then age this exposure to establish an allowance for doubtful accounts based on prior experience. | ||
Deferred Acquisition Costs Policy | ' | |
Deferred Acquisition Costs Deferred acquisition costs include commissions, premium taxes, and other variable underwriting and direct sales costs incurred in connection with the successful acquisition or renewal of insurance contracts. These acquisition costs are deferred and amortized over the policy period in which the related premiums are earned. We consider anticipated investment income in determining the recoverability of these costs. Management believes that these costs will be fully recoverable in the near term. | ||
We do not defer any advertising costs. | ||
Reserve For Losses And Loss Adjustment Expenses | ' | |
Loss and Loss Adjustment Expense Reserves Loss reserves represent the estimated liability on claims reported to us, plus reserves for losses incurred but not recorded (IBNR). These estimates are reported net of amounts estimated to be recoverable from salvage and subrogation. Loss adjustment expense reserves represent the estimated expenses required to settle these claims and losses. The methods of making estimates and establishing these reserves are reviewed regularly, and resulting adjustments are reflected in income currently. Such loss and loss adjustment expense reserves are susceptible to change in the near term. | ||
Reinsurance Policy | ' | |
Reinsurance Our reinsurance transactions primarily include premiums ceded to state-provided reinsurance facilities (e.g., Michigan Catastrophic Claims Association and North Carolina Reinsurance Facility) and premiums written under state-mandated involuntary plans for commercial vehicles (Commercial Auto Insurance Procedures/Plans – “CAIP”). Prepaid reinsurance premiums are earned on a pro rata basis over the period of risk, based on a daily earnings convention, which is consistent with premiums written. See Note 7 – Reinsurance for further discussion. | ||
Income Tax Policy | ' | |
Income Taxes The income tax provision is calculated under the balance sheet approach. Deferred tax assets and liabilities are recorded based on the difference between the financial statement and tax bases of assets and liabilities at the enacted tax rates. The principal items giving rise to such differences are investment securities (e.g., net unrealized gains (losses), write-downs on securities determined to be other-than-temporarily impaired, and derivative instruments), loss and loss adjustment expense reserves, unearned premiums reserves, deferred acquisition costs, property and equipment, and non-deductible accruals. We review our deferred tax assets regularly for recoverability. See Note 5 – Income Taxes for further discussion. | ||
Property, Plant and Equipment Policy | ' | |
Property and Equipment Property and equipment are recorded at cost, less accumulated depreciation, and include capitalized software developed or acquired for internal use. Depreciation is recognized over the estimated useful lives of the assets using accelerated methods for most computer equipment and the straight-line method for certain computer equipment and all other fixed assets. The useful lives range from 2 to 3 years for computer equipment and laptop computers; 7 to 40 years for buildings, improvements, and integrated components; and 3 to 10 years for all other property and equipment. Land and buildings comprised 76% and 75% of total property and equipment at December 31, 2013 and 2012, respectively. | ||
Guaranty Fund Assessments Policy | ' | |
Guaranty Fund Assessments We are subject to state guaranty fund assessments, which provide for the payment of covered claims or other insurance obligations of insurance companies deemed insolvent. These assessments are accrued after a formal determination of insolvency has occurred, and we have written the premiums on which the assessments will be based. | ||
Fees and Other Revenues | ' | |
Fees and Other Revenues Fees and other revenues primarily represent fees collected from policyholders relating to installment charges in accordance with our bill plans, as well as late payment and insufficient funds fees. Other revenues may include revenue from the sale of tax credits, rental income, and other revenue transactions. | ||
Non-Insurance Service Business | ' | |
Service Revenues and Expenses Our service businesses provide insurance-related services. Service revenues generated from processing business for involuntary CAIP plans are earned on a pro rata basis over the term of the related policies. Service expenses related to these CAIP plans include acquisition expenses, which are deferred and amortized over the period in which the related revenues are earned. Other service business revenues and expenses are recorded in the period in which they are earned or incurred. | ||
Equity-Based Compensation | ' | |
Equity-Based Compensation We currently issue time-based and performance-based restricted stock unit awards to key members of management as our form of equity compensation, and time-based restricted stock awards to non-employee directors. Prior to 2010, we issued restricted stock awards, instead of restricted stock unit awards, to employees. Collectively, we refer to these awards as “restricted equity awards.” We currently do not issue stock options as a form of equity compensation. Compensation expense for time-based restricted equity awards with installment vesting is recognized over each respective vesting period. For performance-based restricted equity awards, compensation expense is recognized over the respective estimated vesting periods. | ||
We record an estimate for expected forfeitures of restricted equity awards based on our historical forfeiture rates. In addition, we shorten the vesting periods of certain restricted equity awards based on the “qualified retirement” provisions in our incentive compensation plans, under which (among other provisions) the vesting of 50% of outstanding time-based restricted equity awards will accelerate upon retirement if the participant is 55 years of age or older and satisfies certain years-of-service requirements. We modified our "qualified retirement" provisions for awards granted after February 2013 to vest and distribute 50% of the unvested portion of the award upon reaching eligibility for a qualified retirement and, thereafter, shortly after the grant date. | ||
Net Income Per Share Policy | ' | |
Net Income Per Share Basic net income per share is computed using the weighted average number of common shares outstanding during the reporting period, excluding unvested time-based and performance-based restricted equity awards that are subject to forfeiture. Diluted net income per share includes common stock equivalents assumed outstanding during the period. Our common stock equivalents include the incremental shares assumed to be issued for: | ||
• | outstanding stock options (all remaining stock options were exercised in 2012) | |
• | unvested time-based restricted equity awards, and | |
• | certain unvested performance-based restricted equity awards that satisfied contingency conditions for common stock equivalents during the period. | |
Cash Flow Supplemental Disclosure | ' | |
Supplemental Cash Flow Information Cash includes only bank demand deposits. Non-cash activity includes declared but unpaid dividends. | ||
Reclassifications | ' | |
Reclassification For the period ended December 31, 2012, we reclassified dividends payable out of "accounts payable, accrued expenses, and other liabilities" to be reported as a separate line item to conform with the current-year presentation. There was no effect on total liabilities. |
Reporting_And_Accounting_Polic2
Reporting And Accounting Policies (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Advertising Costs | ' | |||||||||
Total advertising costs, which are expensed as incurred, for the years ended December 31, were: | ||||||||||
(millions) | Advertising Costs | |||||||||
2013 | $ | 619.3 | ||||||||
2012 | 546.8 | |||||||||
2011 | 543 | |||||||||
Interest Capitalized | ' | |||||||||
Total capitalized interest, which primarily relates to capitalized software projects, for the years ended December 31, was: | ||||||||||
(millions) | Capitalized | |||||||||
Interest | ||||||||||
2013 | $ | 0.8 | ||||||||
2012 | 0.3 | |||||||||
2011 | 0.4 | |||||||||
Equity-based Compensation and Related Tax Benefits | ' | |||||||||
The total compensation expense recognized for our equity-based compensation for the years ended December 31, was: | ||||||||||
(millions) | 2013 | 2012 | 2011 | |||||||
Pretax expense | $ | 64.9 | $ | 63.4 | $ | 50.5 | ||||
Tax benefit | 22.7 | 22.2 | 17.7 | |||||||
Supplemental Cash Flow Information | ' | |||||||||
Non-cash activity includes declared but unpaid dividends. For the years ended December 31, we paid the following: | ||||||||||
(millions) | 2013 | 2012 | 2011 | |||||||
Income taxes | $ | 497 | $ | 389.1 | $ | 435 | ||||
Interest | 122.3 | 135 | 129.5 | |||||||
Investments_Tables
Investments (Tables) | 12 Months Ended | ||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||
Investment Portfolio by Major Security Type | ' | ||||||||||||||||||||||||||
The following tables present the composition of our investment portfolio by major security type, consistent with our internal classification of how we manage, monitor, and measure the portfolio: | |||||||||||||||||||||||||||
($ in millions) | Cost | Gross Unrealized Gains | Gross Unrealized Losses | Net Realized Gains (Losses)1 | Fair Value | % of Total Fair Value | |||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | $ | 3,630.40 | $ | 48.4 | $ | (16.6 | ) | $ | 0 | $ | 3,662.20 | 20.3 | % | ||||||||||||||
State and local government obligations | 2,247.30 | 27.1 | (18.4 | ) | 0 | 2,256.00 | 12.5 | ||||||||||||||||||||
Foreign government obligations | 15.6 | 0 | 0 | 0 | 15.6 | 0.1 | |||||||||||||||||||||
Corporate debt securities | 2,885.00 | 60.4 | (20.4 | ) | 1.6 | 2,926.60 | 16.2 | ||||||||||||||||||||
Residential mortgage-backed securities | 1,110.10 | 31.9 | (14.1 | ) | 0 | 1,127.90 | 6.2 | ||||||||||||||||||||
Commercial mortgage-backed securities | 2,154.40 | 43.9 | (37.8 | ) | 0 | 2,160.50 | 12 | ||||||||||||||||||||
Other asset-backed securities | 1,073.00 | 6.6 | (2.1 | ) | 0.2 | 1,077.70 | 6 | ||||||||||||||||||||
Redeemable preferred stocks | 299.5 | 24.1 | (9.7 | ) | 0 | 313.9 | 1.7 | ||||||||||||||||||||
Total fixed maturities | 13,415.30 | 242.4 | (119.1 | ) | 1.8 | 13,540.40 | 75 | ||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 445.7 | 258.7 | (4.5 | ) | 11.3 | 711.2 | 3.9 | ||||||||||||||||||||
Common equities | 1,451.10 | 1,081.80 | (2.4 | ) | 0 | 2,530.50 | 14 | ||||||||||||||||||||
Short-term investments: | |||||||||||||||||||||||||||
Other short-term investments | 1,272.60 | 0 | 0 | 0 | 1,272.60 | 7.1 | |||||||||||||||||||||
Total portfolio2,3 | $ | 16,584.70 | $ | 1,582.90 | $ | (126.0 | ) | $ | 13.1 | $ | 18,054.70 | 100 | % | ||||||||||||||
($ in millions) | Cost | Gross Unrealized Gains | Gross Unrealized Losses | Net Realized Gains (Losses)1 | Fair Value | % of Total Fair Value | |||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | $ | 2,806.40 | $ | 90.1 | $ | 0 | $ | 0 | $ | 2,896.50 | 17.6 | % | |||||||||||||||
State and local government obligations | 1,914.40 | 50.6 | (.6 | ) | 0 | 1,964.40 | 11.9 | ||||||||||||||||||||
Foreign government obligations | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
Corporate debt securities | 2,982.90 | 124.7 | (1.0 | ) | 6.4 | 3,113.00 | 18.9 | ||||||||||||||||||||
Residential mortgage-backed securities | 413.4 | 24 | (9.2 | ) | 0 | 428.2 | 2.6 | ||||||||||||||||||||
Commercial mortgage-backed securities | 1,963.90 | 84.9 | (.1 | ) | 0 | 2,048.70 | 12.4 | ||||||||||||||||||||
Other asset-backed securities | 936 | 12.9 | (.1 | ) | (.2 | ) | 948.6 | 5.8 | |||||||||||||||||||
Redeemable preferred stocks | 356.9 | 30.5 | (12.7 | ) | 0 | 374.7 | 2.3 | ||||||||||||||||||||
Total fixed maturities | 11,373.90 | 417.7 | (23.7 | ) | 6.2 | 11,774.10 | 71.5 | ||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 404 | 404.6 | 0 | 3.8 | 812.4 | 4.9 | |||||||||||||||||||||
Common equities | 1,370.30 | 539 | (10.3 | ) | 0 | 1,899.00 | 11.5 | ||||||||||||||||||||
Short-term investments: | |||||||||||||||||||||||||||
Other short-term investments | 1,990.00 | 0 | 0 | 0 | 1,990.00 | 12.1 | |||||||||||||||||||||
Total portfolio2,3 | $ | 15,138.20 | $ | 1,361.30 | $ | (34.0 | ) | $ | 10 | $ | 16,475.50 | 100 | % | ||||||||||||||
1 Represents net holding period gains (losses) on certain hybrid securities (discussed below). | |||||||||||||||||||||||||||
2 Reflected in our total portfolio are unsettled security transactions and collateral on open derivative positions, which collectively reflect a liability of $61.3 million at December 31, 2013, compared to an asset of $90.9 million at December 31, 2012. | |||||||||||||||||||||||||||
3 The total fair value of the portfolio included $1.8 billion and $1.4 billion at December 31, 2013 and 2012, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of any unsettled security transactions. | |||||||||||||||||||||||||||
Hybrid Securities | ' | ||||||||||||||||||||||||||
Included in our fixed-maturity and equity securities are hybrid securities, which are reported at fair value at December 31: | |||||||||||||||||||||||||||
(millions) | 2013 | 2012 | |||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
Corporate debt securities | $ | 164.2 | $ | 176.1 | |||||||||||||||||||||||
Other asset-backed securities | 14.8 | 16.4 | |||||||||||||||||||||||||
Total fixed maturities | 179 | 192.5 | |||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 60.3 | 52.8 | |||||||||||||||||||||||||
Total hybrid securities | $ | 239.3 | $ | 245.3 | |||||||||||||||||||||||
Composition of Fixed Maturities by Maturity | ' | ||||||||||||||||||||||||||
The composition of fixed maturities by maturity at December 31, 2013, was: | |||||||||||||||||||||||||||
(millions) | Cost | Fair Value | |||||||||||||||||||||||||
Less than one year | $ | 1,829.30 | $ | 1,857.60 | |||||||||||||||||||||||
One to five years | 8,554.80 | 8,693.60 | |||||||||||||||||||||||||
Five to ten years | 2,860.50 | 2,812.10 | |||||||||||||||||||||||||
Ten years or greater | 102.6 | 109 | |||||||||||||||||||||||||
Total1 | $ | 13,347.20 | $ | 13,472.30 | |||||||||||||||||||||||
1 Excludes $68.1 million related to our open interest rate swap positions. | |||||||||||||||||||||||||||
Gross Unrealized Losses by Major Security | ' | ||||||||||||||||||||||||||
The following tables show the composition of gross unrealized losses by major security type and by the length of time that individual securities have been in a continuous unrealized loss position: | |||||||||||||||||||||||||||
Total No. of Sec. | Total | Gross Unrealized Losses | Less than 12 Months | 12 Months or Greater | |||||||||||||||||||||||
Fair | |||||||||||||||||||||||||||
($ in millions) | Value | No. of Sec. | Fair | Unrealized Losses | No. of Sec. | Fair | Unrealized Losses | ||||||||||||||||||||
Value | Value | ||||||||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | 29 | $ | 1,444.30 | $ | (16.6 | ) | 28 | $ | 1,434.60 | $ | (16.3 | ) | 1 | $ | 9.7 | $ | (.3 | ) | |||||||||
State and local government obligations | 141 | 844.2 | (18.4 | ) | 119 | 759.3 | (17.1 | ) | 22 | 84.9 | (1.3 | ) | |||||||||||||||
Corporate debt securities | 51 | 997.6 | (20.4 | ) | 45 | 831.1 | (17.8 | ) | 6 | 166.5 | (2.6 | ) | |||||||||||||||
Residential mortgage-backed securities | 66 | 763.5 | (14.1 | ) | 45 | 597.6 | (7.9 | ) | 21 | 165.9 | (6.2 | ) | |||||||||||||||
Commercial mortgage-backed securities | 76 | 1,061.90 | (37.8 | ) | 60 | 809.2 | (19.7 | ) | 16 | 252.7 | (18.1 | ) | |||||||||||||||
Other asset-backed securities | 25 | 287.2 | (2.1 | ) | 22 | 233.3 | (1.8 | ) | 3 | 53.9 | (.3 | ) | |||||||||||||||
Redeemable preferred stocks | 4 | 122.7 | (9.7 | ) | 0 | 0 | 0 | 4 | 122.7 | (9.7 | ) | ||||||||||||||||
Total fixed maturities | 392 | 5,521.40 | (119.1 | ) | 319 | 4,665.10 | (80.6 | ) | 73 | 856.3 | (38.5 | ) | |||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 7 | 142.3 | (4.5 | ) | 7 | 142.3 | (4.5 | ) | 0 | 0 | 0 | ||||||||||||||||
Common equities | 24 | 59.7 | (2.4 | ) | 20 | 58.5 | (2.4 | ) | 4 | 1.2 | 0 | ||||||||||||||||
Total equity securities | 31 | 202 | (6.9 | ) | 27 | 200.8 | (6.9 | ) | 4 | 1.2 | 0 | ||||||||||||||||
Total portfolio | 423 | $ | 5,723.40 | $ | (126.0 | ) | 346 | $ | 4,865.90 | $ | (87.5 | ) | 77 | $ | 857.5 | $ | (38.5 | ) | |||||||||
Total No. of Sec. | Total | Gross | Less than 12 Months | 12 Months or Greater | |||||||||||||||||||||||
Fair | Unrealized | ||||||||||||||||||||||||||
($ in millions) | Value | Losses | No. of Sec. | Fair | Unrealized | No. of Sec. | Fair | Unrealized | |||||||||||||||||||
Value | Losses | Value | Losses | ||||||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | 0 | $ | 0 | $ | 0 | 0 | $ | 0 | $ | 0 | 0 | $ | 0 | $ | 0 | ||||||||||||
State and local government obligations | 44 | 162.8 | (.6 | ) | 37 | 123.1 | (.5 | ) | 7 | 39.7 | (.1 | ) | |||||||||||||||
Corporate debt securities | 8 | 128.2 | (1.0 | ) | 8 | 128.2 | (1.0 | ) | 0 | 0 | 0 | ||||||||||||||||
Residential mortgage-backed securities | 28 | 149.2 | (9.2 | ) | 5 | 40.2 | (.6 | ) | 23 | 109 | (8.6 | ) | |||||||||||||||
Commercial mortgage-backed securities | 10 | 7.1 | (.1 | ) | 5 | 2.1 | 0 | 5 | 5 | (.1 | ) | ||||||||||||||||
Other asset-backed securities | 4 | 25 | (.1 | ) | 3 | 20.8 | 0 | 1 | 4.2 | (.1 | ) | ||||||||||||||||
Redeemable preferred stocks | 5 | 155.7 | (12.7 | ) | 1 | 24.9 | 0 | 4 | 130.8 | (12.7 | ) | ||||||||||||||||
Total fixed maturities | 99 | 628 | (23.7 | ) | 59 | 339.3 | (2.1 | ) | 40 | 288.7 | (21.6 | ) | |||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Common equities | 97 | 118.2 | (10.3 | ) | 80 | 100.7 | (8.2 | ) | 17 | 17.5 | (2.1 | ) | |||||||||||||||
Total equity securities | 97 | 118.2 | (10.3 | ) | 80 | 100.7 | (8.2 | ) | 17 | 17.5 | (2.1 | ) | |||||||||||||||
Total portfolio | 196 | $ | 746.2 | $ | (34.0 | ) | 139 | $ | 440 | $ | (10.3 | ) | 57 | $ | 306.2 | $ | (23.7 | ) | |||||||||
Total Non-Credit Portion of Other-Than-Temporary Impairment Recorded in Accumulated Other Comprehensive Income, Reflecting Orginal Non-Credit Loss at the Time Credit Impairment | ' | ||||||||||||||||||||||||||
The following table shows the total non-credit portion of the OTTI recorded in accumulated other comprehensive income, reflecting the original non-credit loss at the time the credit impairment was determined: | |||||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||||
(millions) | 2013 | 2012 | |||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
Residential mortgage-backed securities | $ | (44.1 | ) | $ | (44.2 | ) | |||||||||||||||||||||
Commercial mortgage-backed securities | (.9 | ) | (.9 | ) | |||||||||||||||||||||||
Total fixed maturities | $ | (45.0 | ) | $ | (45.1 | ) | |||||||||||||||||||||
OTTI Credit Losses Recognized in Earnings | ' | ||||||||||||||||||||||||||
The following tables provide rollforwards of the amounts related to credit losses recognized in earnings for the periods ended December 31, 2013, 2012, and 2011, for which a portion of the OTTI losses were also recognized in accumulated other comprehensive income at the time the credit impairments were determined and recognized: | |||||||||||||||||||||||||||
(millions) | Residential | Commercial | Corporate | Total | |||||||||||||||||||||||
Mortgage- | Mortgage- | Debt | |||||||||||||||||||||||||
Backed | Backed | ||||||||||||||||||||||||||
Balance at December 31, 2012 | $ | 27.1 | $ | 0.6 | $ | 0 | $ | 27.7 | |||||||||||||||||||
Credit losses for which an OTTI was previously recognized | 0.1 | 0 | 0 | 0.1 | |||||||||||||||||||||||
Credit losses for which an OTTI was not previously recognized | 0 | 0 | 0 | 0 | |||||||||||||||||||||||
Reductions for securities sold/matured | 0 | 0 | 0 | 0 | |||||||||||||||||||||||
Change in recoveries of future cash flows expected to be collected1,2 | (7.8 | ) | (.2 | ) | 0 | (8.0 | ) | ||||||||||||||||||||
Reductions for previously recognized credit impairments | (.2 | ) | 0 | 0 | (.2 | ) | |||||||||||||||||||||
written-down to fair value3 | |||||||||||||||||||||||||||
Balance at December 31, 2013 | $ | 19.2 | $ | 0.4 | $ | 0 | $ | 19.6 | |||||||||||||||||||
(millions) | Residential | Commercial | Corporate | Total | |||||||||||||||||||||||
Mortgage- | Mortgage- | Debt | |||||||||||||||||||||||||
Backed | Backed | ||||||||||||||||||||||||||
Balance at December 31, 2011 | $ | 34.5 | $ | 1.3 | $ | 0 | $ | 35.8 | |||||||||||||||||||
Credit losses for which an OTTI was previously recognized | 0.1 | 0 | 0 | 0.1 | |||||||||||||||||||||||
Credit losses for which an OTTI was not previously recognized | 0.3 | 0 | 0 | 0.3 | |||||||||||||||||||||||
Reductions for securities sold/matured | 0 | (.2 | ) | 0 | (.2 | ) | |||||||||||||||||||||
Change in recoveries of future cash flows expected to be collected1,2 | (3.8 | ) | (.2 | ) | 0 | (4.0 | ) | ||||||||||||||||||||
Reductions for previously recognized credit impairments | (4.0 | ) | (.3 | ) | 0 | (4.3 | ) | ||||||||||||||||||||
written-down to fair value3 | |||||||||||||||||||||||||||
Balance at December 31, 2012 | $ | 27.1 | $ | 0.6 | $ | 0 | $ | 27.7 | |||||||||||||||||||
(millions) | Residential | Commercial | Corporate | Total | |||||||||||||||||||||||
Mortgage- | Mortgage- | Debt | |||||||||||||||||||||||||
Backed | Backed | ||||||||||||||||||||||||||
Balance at December 31, 2010 | $ | 32.3 | $ | 1 | $ | 6.5 | $ | 39.8 | |||||||||||||||||||
Credit losses for which an OTTI was previously recognized | 1.4 | 0 | 0 | 1.4 | |||||||||||||||||||||||
Credit losses for which an OTTI was not previously recognized | 1.1 | 0.4 | 0 | 1.5 | |||||||||||||||||||||||
Reductions for securities sold/matured | 0 | 0 | 0 | 0 | |||||||||||||||||||||||
Change in recoveries of future cash flows expected to be collected1,2 | 0.8 | 0.3 | (6.5 | ) | (5.4 | ) | |||||||||||||||||||||
Reductions for previously recognized credit impairments | (1.1 | ) | (.4 | ) | 0 | (1.5 | ) | ||||||||||||||||||||
written-down to fair value3 | |||||||||||||||||||||||||||
Balance at December 31, 2011 | $ | 34.5 | $ | 1.3 | $ | 0 | $ | 35.8 | |||||||||||||||||||
1 Reflects expected recovery of prior period impairments that will be accreted into income over the remaining life of the security. | |||||||||||||||||||||||||||
2 Includes $2.6 million, $1.4 million, and $2.0 million at December 31, 2013, 2012, and 2011, respectively, received in excess of the cash flows expected to be collected at the time of the write-downs. | |||||||||||||||||||||||||||
3 Reflects reductions of prior credit impairments where the current credit impairment requires writing securities down to fair value (i.e., no remaining non-credit loss). | |||||||||||||||||||||||||||
Components of Net Realized Gains (Losses) | ' | ||||||||||||||||||||||||||
The components of net realized gains (losses) for the years ended December 31, were: | |||||||||||||||||||||||||||
(millions) | 2013 | 2012 | 2011 | ||||||||||||||||||||||||
Gross realized gains on security sales | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | $ | 8.5 | $ | 20.2 | $ | 59.1 | |||||||||||||||||||||
State and local government obligations | 7.7 | 15 | 3.5 | ||||||||||||||||||||||||
Corporate and other debt securities | 47.7 | 58.1 | 23 | ||||||||||||||||||||||||
Residential mortgage-backed securities | 3 | 1.2 | 2 | ||||||||||||||||||||||||
Commercial mortgage-backed securities | 10 | 19.3 | 0.3 | ||||||||||||||||||||||||
Other asset-backed securities | 0 | 0.9 | 2.1 | ||||||||||||||||||||||||
Redeemable preferred stocks | 0 | 0.7 | 4.6 | ||||||||||||||||||||||||
Total fixed maturities | 76.9 | 115.4 | 94.6 | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 126.3 | 78.2 | 148.9 | ||||||||||||||||||||||||
Common equities | 68.6 | 167 | 11.6 | ||||||||||||||||||||||||
Subtotal gross realized gains on security sales | 271.8 | 360.6 | 255.1 | ||||||||||||||||||||||||
Gross realized losses on security sales | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | (3.7 | ) | (1.9 | ) | (9.3 | ) | |||||||||||||||||||||
Corporate and other debt securities | (6.2 | ) | (.6 | ) | (3.5 | ) | |||||||||||||||||||||
Commercial mortgage-backed securities | (1.8 | ) | 0 | 0 | |||||||||||||||||||||||
Redeemable preferred stocks | (.1 | ) | (.4 | ) | (2.2 | ) | |||||||||||||||||||||
Total fixed maturities | (11.8 | ) | (2.9 | ) | (15.0 | ) | |||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | (.1 | ) | (1.1 | ) | 0 | ||||||||||||||||||||||
Common equities | (.6 | ) | (27.1 | ) | (36.5 | ) | |||||||||||||||||||||
Subtotal gross realized losses on security sales | (12.5 | ) | (31.1 | ) | (51.5 | ) | |||||||||||||||||||||
Net realized gains (losses) on security sales | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | 4.8 | 18.3 | 49.8 | ||||||||||||||||||||||||
State and local government obligations | 7.7 | 15 | 3.5 | ||||||||||||||||||||||||
Corporate and other debt securities | 41.5 | 57.5 | 19.5 | ||||||||||||||||||||||||
Residential mortgage-backed securities | 3 | 1.2 | 2 | ||||||||||||||||||||||||
Commercial mortgage-backed securities | 8.2 | 19.3 | 0.3 | ||||||||||||||||||||||||
Other asset-backed securities | 0 | 0.9 | 2.1 | ||||||||||||||||||||||||
Redeemable preferred stocks | (.1 | ) | 0.3 | 2.4 | |||||||||||||||||||||||
Total fixed maturities | 65.1 | 112.5 | 79.6 | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 126.2 | 77.1 | 148.9 | ||||||||||||||||||||||||
Common equities | 68 | 139.9 | (24.9 | ) | |||||||||||||||||||||||
Subtotal net realized gains (losses) on security sales | 259.3 | 329.5 | 203.6 | ||||||||||||||||||||||||
Other-than-temporary impairment losses | |||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
Residential mortgage-backed securities | (.6 | ) | (1.6 | ) | (3.3 | ) | |||||||||||||||||||||
Commercial mortgage-backed securities | 0 | (.1 | ) | (.6 | ) | ||||||||||||||||||||||
Total fixed maturities | (.6 | ) | (1.7 | ) | (3.9 | ) | |||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Common equities | (5.5 | ) | (1.8 | ) | (.2 | ) | |||||||||||||||||||||
Subtotal other-than-temporary impairment losses | (6.1 | ) | (3.5 | ) | (4.1 | ) | |||||||||||||||||||||
Other gains (losses) | |||||||||||||||||||||||||||
Hybrid securities | 6.4 | 14.3 | 1.7 | ||||||||||||||||||||||||
Derivative instruments | 56.6 | (43.1 | ) | (98.9 | ) | ||||||||||||||||||||||
Litigation settlements | 2.2 | 9.6 | 0.3 | ||||||||||||||||||||||||
Subtotal other gains (losses) | 65.2 | (19.2 | ) | (96.9 | ) | ||||||||||||||||||||||
Total net realized gains (losses) on securities | $ | 318.4 | $ | 306.8 | $ | 102.6 | |||||||||||||||||||||
Components of Net Investment Income | ' | ||||||||||||||||||||||||||
The components of net investment income for the years ended December 31, were: | |||||||||||||||||||||||||||
(millions) | 2013 | 2012 | 2011 | ||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||
U.S. government obligations | $ | 50.2 | $ | 49.8 | $ | 58 | |||||||||||||||||||||
State and local government obligations | 48 | 51.1 | 60 | ||||||||||||||||||||||||
Foreign government obligations | 0.2 | 0 | 0 | ||||||||||||||||||||||||
Corporate debt securities | 98.8 | 107.5 | 106.7 | ||||||||||||||||||||||||
Residential mortgage-backed securities | 28.1 | 16.1 | 18.6 | ||||||||||||||||||||||||
Commercial mortgage-backed securities | 74.8 | 82.2 | 83.4 | ||||||||||||||||||||||||
Other asset-backed securities | 16.7 | 20.3 | 24.5 | ||||||||||||||||||||||||
Redeemable preferred stocks | 21.2 | 24.2 | 33 | ||||||||||||||||||||||||
Total fixed maturities | 338 | 351.2 | 384.2 | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||
Nonredeemable preferred stocks | 36.2 | 43.8 | 57.7 | ||||||||||||||||||||||||
Common equities | 45.8 | 44.9 | 35.7 | ||||||||||||||||||||||||
Short-term investments: | |||||||||||||||||||||||||||
Other short-term investments | 2 | 3.1 | 2.4 | ||||||||||||||||||||||||
Investment income | 422 | 443 | 480 | ||||||||||||||||||||||||
Investment expenses | (18.8 | ) | (15.4 | ) | (13.5 | ) | |||||||||||||||||||||
Net investment income | $ | 403.2 | $ | 427.6 | $ | 466.5 | |||||||||||||||||||||
Derivative Instruments | ' | ||||||||||||||||||||||||||
The following table shows the status of our derivative instruments at December 31, 2013 and 2012, and for the years ended December 31, 2013, 2012, and 2011; amounts are on a pretax basis: | |||||||||||||||||||||||||||
(millions) | Balance Sheet2 | Comprehensive | |||||||||||||||||||||||||
Income Statement | |||||||||||||||||||||||||||
Notional Value1 | Assets | Net Realized | |||||||||||||||||||||||||
(Liabilities) | Gains (Losses) | ||||||||||||||||||||||||||
Fair Value | on Securities | ||||||||||||||||||||||||||
Years ended | |||||||||||||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||||||||||||
Derivatives | 2013 | 2012 | 2011 | Purpose | Classification | 2013 | 2012 | 2013 | 2012 | 2011 | |||||||||||||||||
designated as: | |||||||||||||||||||||||||||
Hedging instruments | |||||||||||||||||||||||||||
Closed: | |||||||||||||||||||||||||||
Ineffective cash flow hedge | $ | 54 | $ | 31 | $ | 15 | Manage | NA | $ | 0 | $ | 0 | $ | 0.8 | $ | 0.6 | $ | 0.3 | |||||||||
interest | |||||||||||||||||||||||||||
rate risk | |||||||||||||||||||||||||||
Non-hedging instruments | |||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||
Interest rate swaps | 750 | 0 | 0 | Manage portfolio duration | Investments - fixed | 68.1 | 0 | 59.8 | 0 | 0 | |||||||||||||||||
maturities | |||||||||||||||||||||||||||
Corporate credit default swaps | 0 | 0 | 25 | Manage | Investments - fixed | 0 | 0 | 0 | 0 | (.2 | ) | ||||||||||||||||
credit | maturities | ||||||||||||||||||||||||||
risk | |||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||
Interest rate swaps | 0 | 1,263 | 1,263 | Manage | Other liabilities | 0 | (95.5 | ) | 0 | (42.7 | ) | (74.0 | ) | ||||||||||||||
portfolio | |||||||||||||||||||||||||||
duration | |||||||||||||||||||||||||||
Closed: | |||||||||||||||||||||||||||
Interest rate swaps | 1,263 | 0 | 350 | Manage | NA | 0 | 0 | (4.0 | ) | 0 | (25.5 | ) | |||||||||||||||
portfolio | |||||||||||||||||||||||||||
duration | |||||||||||||||||||||||||||
Corporate credit default swaps | 0 | 25 | 10 | Manage | NA | 0 | 0 | 0 | (1.0 | ) | 0.5 | ||||||||||||||||
credit | |||||||||||||||||||||||||||
risk | |||||||||||||||||||||||||||
Total | NA | NA | NA | $ | 68.1 | $ | (95.5 | ) | $ | 56.6 | $ | (43.1 | ) | $ | (98.9 | ) | |||||||||||
1 The amounts represent the value held at year end for open positions and the maximum amount held during the year for closed positions. | |||||||||||||||||||||||||||
2 To the extent we hold both derivative assets and liabilities with the same counterparty that are subject to an enforceable master netting arrangement, we expect that we will report them on a gross basis on our balance sheets, consistent with our historical presentation. | |||||||||||||||||||||||||||
NA =ot Applicable |
Fair_Value_Tables
Fair Value (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
Composition of Investment Portfolio by Major Security Type | ' | ||||||||||||||||||||||||
The composition of the investment portfolio by major security type was: | |||||||||||||||||||||||||
Fair Value | |||||||||||||||||||||||||
(millions) | Level 1 | Level 2 | Level 3 | Total | Cost | ||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
U.S. government obligations | $ | 3,662.20 | $ | 0 | $ | 0 | $ | 3,662.20 | $ | 3,630.40 | |||||||||||||||
State and local government obligations | 0 | 2,256.00 | 0 | 2,256.00 | 2,247.30 | ||||||||||||||||||||
Foreign government obligations | 15.6 | 0 | 0 | 15.6 | 15.6 | ||||||||||||||||||||
Corporate debt securities | 0 | 2,926.60 | 0 | 2,926.60 | 2,885.00 | ||||||||||||||||||||
Subtotal | 3,677.80 | 5,182.60 | 0 | 8,860.40 | 8,778.30 | ||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | 0 | 1,127.70 | 0.2 | 1,127.90 | 1,110.10 | ||||||||||||||||||||
Commercial mortgage-backed | 0 | 2,131.50 | 29 | 2,160.50 | 2,154.40 | ||||||||||||||||||||
Other asset-backed | 0 | 1,077.70 | 0 | 1,077.70 | 1,073.00 | ||||||||||||||||||||
Subtotal asset-backed securities | 0 | 4,336.90 | 29.2 | 4,366.10 | 4,337.50 | ||||||||||||||||||||
Redeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 0 | 102.8 | 0 | 102.8 | 84.2 | ||||||||||||||||||||
Utilities | 0 | 65.6 | 0 | 65.6 | 64.9 | ||||||||||||||||||||
Industrials | 0 | 145.5 | 0 | 145.5 | 150.4 | ||||||||||||||||||||
Subtotal redeemable preferred stocks | 0 | 313.9 | 0 | 313.9 | 299.5 | ||||||||||||||||||||
Total fixed maturities | 3,677.80 | 9,833.40 | 29.2 | 13,540.40 | 13,415.30 | ||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 240.8 | 414.6 | 39 | 694.4 | 431.5 | ||||||||||||||||||||
Utilities | 0 | 16.8 | 0 | 16.8 | 14.2 | ||||||||||||||||||||
Subtotal nonredeemable preferred stocks | 240.8 | 431.4 | 39 | 711.2 | 445.7 | ||||||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Common stocks | 2,530.00 | 0 | 0 | 2,530.00 | 1,450.60 | ||||||||||||||||||||
Other risk investments | 0 | 0 | 0.5 | 0.5 | 0.5 | ||||||||||||||||||||
Subtotal common equities | 2,530.00 | 0 | 0.5 | 2,530.50 | 1,451.10 | ||||||||||||||||||||
Total fixed maturities and equity securities | 6,448.60 | 10,264.80 | 68.7 | 16,782.10 | 15,312.10 | ||||||||||||||||||||
Short-term investments: | |||||||||||||||||||||||||
Other short-term investments | 987.8 | 284.8 | 0 | 1,272.60 | 1,272.60 | ||||||||||||||||||||
Total portfolio | $ | 7,436.40 | $ | 10,549.60 | $ | 68.7 | $ | 18,054.70 | $ | 16,584.70 | |||||||||||||||
Debt | $ | 0 | $ | 2,073.70 | $ | 0 | $ | 2,073.70 | $ | 1,860.90 | |||||||||||||||
Fair Value | |||||||||||||||||||||||||
(millions) | Level 1 | Level 2 | Level 3 | Total | Cost | ||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
U.S. government obligations | $ | 2,896.50 | $ | 0 | $ | 0 | $ | 2,896.50 | $ | 2,806.40 | |||||||||||||||
State and local government obligations | 0 | 1,964.40 | 0 | 1,964.40 | 1,914.40 | ||||||||||||||||||||
Foreign government obligations | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||
Corporate debt securities | 0 | 3,113.00 | 0 | 3,113.00 | 2,982.90 | ||||||||||||||||||||
Subtotal | 2,896.50 | 5,077.40 | 0 | 7,973.90 | 7,703.70 | ||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | 0 | 382.7 | 45.5 | 428.2 | 413.4 | ||||||||||||||||||||
Commercial mortgage-backed | 0 | 2,023.40 | 25.3 | 2,048.70 | 1,963.90 | ||||||||||||||||||||
Other asset-backed | 0 | 948.6 | 0 | 948.6 | 936 | ||||||||||||||||||||
Subtotal asset-backed securities | 0 | 3,354.70 | 70.8 | 3,425.50 | 3,313.30 | ||||||||||||||||||||
Redeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 0 | 129.7 | 0 | 129.7 | 110.7 | ||||||||||||||||||||
Utilities | 0 | 66.7 | 0 | 66.7 | 64.9 | ||||||||||||||||||||
Industrials | 0 | 178.3 | 0 | 178.3 | 181.3 | ||||||||||||||||||||
Subtotal redeemable preferred stocks | 0 | 374.7 | 0 | 374.7 | 356.9 | ||||||||||||||||||||
Total fixed maturities | 2,896.50 | 8,806.80 | 70.8 | 11,774.10 | 11,373.90 | ||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 259.6 | 494.5 | 31.9 | 786 | 383.3 | ||||||||||||||||||||
Utilities | 0 | 26.4 | 0 | 26.4 | 20.7 | ||||||||||||||||||||
Subtotal nonredeemable preferred stocks | 259.6 | 520.9 | 31.9 | 812.4 | 404 | ||||||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Common stocks | 1,887.00 | 0 | 0 | 1,887.00 | 1,367.20 | ||||||||||||||||||||
Other risk investments | 0 | 0 | 12 | 12 | 3.1 | ||||||||||||||||||||
Subtotal common equities | 1,887.00 | 0 | 12 | 1,899.00 | 1,370.30 | ||||||||||||||||||||
Total fixed maturities and equity securities | 5,043.10 | 9,327.70 | 114.7 | 14,485.50 | 13,148.20 | ||||||||||||||||||||
Short-term investments: | |||||||||||||||||||||||||
Other short-term investments | 1,679.90 | 310.1 | 0 | 1,990.00 | 1,990.00 | ||||||||||||||||||||
Total portfolio | $ | 6,723.00 | $ | 9,637.80 | $ | 114.7 | $ | 16,475.50 | $ | 15,138.20 | |||||||||||||||
Debt | $ | 0 | $ | 2,394.40 | $ | 0 | $ | 2,394.40 | $ | 2,063.10 | |||||||||||||||
Summary of Changes in Fair Value Associated With Level 3 Assets | ' | ||||||||||||||||||||||||
The following tables provide a summary of changes in fair value associated with Level 3 assets for the years ended December 31, 2013 and 2012: | |||||||||||||||||||||||||
Level 3 Fair Value | |||||||||||||||||||||||||
(millions) | Fair Value at Dec. 31, 2012 | Calls/ | Purchases | Sales | Net Realized | Change in | Net | Fair Value at Dec. 31, 2013 | |||||||||||||||||
Maturities/ | (Gain)/Loss | Valuation | Transfers | ||||||||||||||||||||||
Paydowns | on Sales | In (Out)1 | |||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | $ | 45.5 | $ | (28.6 | ) | $ | 125.1 | $ | 0 | $ | 0 | $ | (.4 | ) | $ | (141.4 | ) | $ | 0.2 | ||||||
Commercial mortgage-backed | 25.3 | (3.4 | ) | 0 | 0 | 0 | 7.1 | 0 | 29 | ||||||||||||||||
Other asset-backed | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||
Total fixed maturities | 70.8 | (32.0 | ) | 125.1 | 0 | 0 | 6.7 | (141.4 | ) | 29.2 | |||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials2 | 31.9 | 0 | 0 | 0 | 0 | 7.1 | 0 | 39 | |||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Other risk investments | 12 | (.5 | ) | 0.3 | (2.4 | ) | (36.0 | ) | 27.1 | 0 | 0.5 | ||||||||||||||
Total Level 3 securities | $ | 114.7 | $ | (32.5 | ) | $ | 125.4 | $ | (2.4 | ) | $ | (36.0 | ) | $ | 40.9 | $ | (141.4 | ) | $ | 68.7 | |||||
1 The $141.4 million was transferred out of Level 3 and into Level 2 due to an increase in liquidity and trading volume in the market. | |||||||||||||||||||||||||
2 The $7.1 million represents net holding period gains on a hybrid security which is reflected in net realized gains (losses) on securities in the comprehensive income statement. | |||||||||||||||||||||||||
Level 3 Fair Value | |||||||||||||||||||||||||
(millions) | Fair Value at Dec. 31, 2011 | Calls/ | Purchases | Sales | Net Realized | Change in | Net | Fair Value at Dec. 31, 2012 | |||||||||||||||||
Maturities/ | (Gain)/Loss | Valuation | Transfers | ||||||||||||||||||||||
Paydowns | on Sales | In (Out) | |||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | $ | 62.3 | $ | (17.3 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0.5 | $ | 0 | $ | 45.5 | ||||||||
Commercial mortgage-backed | 21.3 | (3.7 | ) | 0 | 0 | 0 | 7.7 | 0 | 25.3 | ||||||||||||||||
Other asset-backed | 2.6 | (2.6 | ) | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
Total fixed maturities | 86.2 | (23.6 | ) | 0 | 0 | 0 | 8.2 | 0 | 70.8 | ||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials1 | 0 | 0 | 28.5 | 0 | 0 | 3.4 | 0 | 31.9 | |||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Other risk investments | 11.5 | (.2 | ) | 0 | 0 | 0 | 0.7 | 0 | 12 | ||||||||||||||||
Total Level 3 securities | $ | 97.7 | $ | (23.8 | ) | $ | 28.5 | $ | 0 | $ | 0 | $ | 12.3 | $ | 0 | $ | 114.7 | ||||||||
1 The $3.4 million represents net holding period gains on a hybrid security which is reflected in net realized gains (losses) on securities in the comprehensive income statement. | |||||||||||||||||||||||||
Summary of Quantitative Information about Level 3 Fair Value Measurements | ' | ||||||||||||||||||||||||
The following table provides a summary of the quantitative information about Level 3 fair value measurements for our applicable securities at December 31: | |||||||||||||||||||||||||
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||||||
($ in millions) | Fair Value at Dec. 31, 2013 | Valuation Technique | Unobservable Input | Unobservable Input Assumption | |||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | $ | 0.2 | External vendor | Prepayment rate1 | 0 | ||||||||||||||||||||
Commercial mortgage-backed | 29 | External vendor | Prepayment rate2 | 0 | |||||||||||||||||||||
Total fixed maturities | 29.2 | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 39 | Multiple of tangible net book value | Price to book ratio multiple | 1.9 | |||||||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Other risk investments | 0 | ||||||||||||||||||||||||
Subtotal Level 3 securities | 68.2 | ||||||||||||||||||||||||
Third-party pricing exemption securities3 | 0.5 | ||||||||||||||||||||||||
Total Level 3 securities | $ | 68.7 | |||||||||||||||||||||||
1 Assumes that one security has 0% of the principal amount of the underlying loans that will be paid off prematurely in each year. | |||||||||||||||||||||||||
2 Assumes that two securities have 0% of the principal amount of the underlying loans that will be paid off prematurely in each year. | |||||||||||||||||||||||||
3 The fair values for these securities were obtained from non-binding external sources where unobservable inputs are not reasonably available to us. | |||||||||||||||||||||||||
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||||||
($ in millions) | Fair Value at Dec. 31, 2012 | Valuation Technique | Unobservable Input | Unobservable Input Assumption | |||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||
Residential mortgage-backed | $ | 0.2 | External vendor | Prepayment rate1 | 16 | ||||||||||||||||||||
Commercial mortgage-backed | 25.3 | External vendor | Prepayment rate2 | 0 | |||||||||||||||||||||
Total fixed maturities | 25.5 | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
Nonredeemable preferred stocks: | |||||||||||||||||||||||||
Financials | 31.9 | Multiple of tangible net book value | Price to book ratio multiple | 1.9 | |||||||||||||||||||||
Common equities: | |||||||||||||||||||||||||
Other risk investments | 11.2 | Discounted consolidated equity | Discount for lack of marketability | 20 | % | ||||||||||||||||||||
Subtotal Level 3 securities | 68.6 | ||||||||||||||||||||||||
Third-party pricing exemption securities3 | 46.1 | ||||||||||||||||||||||||
Total Level 3 securities | $ | 114.7 | |||||||||||||||||||||||
1 Assumes that one security has 16% of the principal amount of the underlying loans that will be paid off prematurely in each year. | |||||||||||||||||||||||||
2 Assumes that three securities have 0% of the principal amount of the underlying loans that will be paid off prematurely in each year. | |||||||||||||||||||||||||
3 The fair values for these securities were obtained from non-binding external sources where unobservable inputs are not reasonably available to us. |
Debt_Tables
Debt (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Debt Table | ' | |||||||||||||
Debt at December 31 consisted of: | ||||||||||||||
2013 | 2012 | |||||||||||||
(millions) | Carrying | Fair | Carrying | Fair | ||||||||||
Value | Value | Value | Value | |||||||||||
7% Notes due 2013 (issued: $150.0, October 1993) | $ | 0 | $ | 0 | $ | 149.9 | $ | 157.1 | ||||||
3.75% Senior Notes due 2021 (issued: $500.0, August 2011) | 497.6 | 509.1 | 497.3 | 549.1 | ||||||||||
6 5/8% Senior Notes due 2029 (issued: $300.0, March 1999) | 295.3 | 359.6 | 295.2 | 385 | ||||||||||
6.25% Senior Notes due 2032 (issued: $400.0, November 2002) | 394.6 | 473.7 | 394.5 | 513.5 | ||||||||||
6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 (issued: $1,000.0, June 2007; outstanding: $677.1 and $731.2) | 673.4 | 731.3 | 726.2 | 789.7 | ||||||||||
Total | $ | 1,860.90 | $ | 2,073.70 | $ | 2,063.10 | $ | 2,394.40 | ||||||
Aggregate Principal Payments on Debt Outstanding | ' | |||||||||||||
Aggregate required principal payments on debt outstanding at December 31, 2013, were as follows: | ||||||||||||||
(millions) | ||||||||||||||
Year | Payments | |||||||||||||
2014 | $ | 0 | ||||||||||||
2015 | 0 | |||||||||||||
2016 | 0 | |||||||||||||
2017 | 0 | |||||||||||||
2018 | 0 | |||||||||||||
Thereafter | 1,877.10 | |||||||||||||
Total | $ | 1,877.10 | ||||||||||||
Cash Flow Hedging | ' | |||||||||||||
Unrealized Gain (Loss) on Interest Rate Cash Flow Hedges Included in Accumulated Other Comprehensive Income | ' | |||||||||||||
The original unrealized gain (loss) at the time of each debt issuance and the unamortized balance at December 31, 2013, on a pretax basis, of these hedges, were as follows: | ||||||||||||||
(millions) | Unrealized Gain (Loss) | Unamortized Balance | ||||||||||||
at Debt Issuance | at December 31, 2013 | |||||||||||||
3.75% Senior Notes | $ | (5.1 | ) | $ | (4.1 | ) | ||||||||
6 5/8% Senior Notes | (4.2 | ) | (3.3 | ) | ||||||||||
6.25% Senior Notes | 5.1 | 4.1 | ||||||||||||
6.70% Debentures | 34.4 | 9.7 | ||||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | |||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||||||||
Components of Income Tax Provision | ' | |||||||||||||||||
The components of our income tax provision were as follows: | ||||||||||||||||||
(millions) | 2013 | 2012 | 2011 | |||||||||||||||
Current tax provision | $ | 460.2 | $ | 424.8 | $ | 440.2 | ||||||||||||
Deferred tax expense (benefit) | 94.4 | (9.4 | ) | 31.3 | ||||||||||||||
Total income tax provision | $ | 554.6 | $ | 415.4 | $ | 471.5 | ||||||||||||
Reconciliation of Provision (Benefit) for Income Taxes Reported in Consolidated Statements of Income with Tax at Statutory Rate | ' | |||||||||||||||||
The provision for income taxes in the accompanying consolidated statements of comprehensive income differed from the statutory rate as follows: | ||||||||||||||||||
($ in millions) | 2013 | 2012 | 2011 | |||||||||||||||
Income before income taxes | $ | 1,720.00 | $ | 1,317.70 | $ | 1,487.00 | ||||||||||||
Tax at statutory rate | $ | 602 | 35 | % | $ | 461.2 | 35 | % | $ | 520.5 | 35 | % | ||||||
Tax effect of: | ||||||||||||||||||
Dividends received deduction | (17.6 | ) | (1 | ) | (18.2 | ) | (1 | ) | (18.2 | ) | (1 | ) | ||||||
Exempt interest income | (13.1 | ) | (1 | ) | (14.7 | ) | (1 | ) | (17.5 | ) | (1 | ) | ||||||
Tax-deductible dividends | (13.6 | ) | (1 | ) | (11.9 | ) | (1 | ) | (3.8 | ) | 0 | |||||||
Tax credits | (2.3 | ) | 0 | 0 | 0 | (9.1 | ) | (1 | ) | |||||||||
Other items, net | (.8 | ) | 0 | (1.0 | ) | 0 | (.4 | ) | 0 | |||||||||
Total income tax provision | $ | 554.6 | 32 | % | $ | 415.4 | 32 | % | $ | 471.5 | 32 | % | ||||||
Components of Net Deferred Tax Assets | ' | |||||||||||||||||
At December 31, 2013 and 2012, the components of the net deferred tax asset/liability were as follows: | ||||||||||||||||||
(millions) | 2013 | 2012 | ||||||||||||||||
Deferred tax assets: | ||||||||||||||||||
Unearned premiums reserve | $ | 361 | $ | 344.3 | ||||||||||||||
Investment basis differences | 94.8 | 208.3 | ||||||||||||||||
Non-deductible accruals | 200.7 | 191.6 | ||||||||||||||||
Loss and loss adjustment expense reserves | 92 | 107.3 | ||||||||||||||||
Other | 14.7 | 3.9 | ||||||||||||||||
Deferred tax liabilities: | ||||||||||||||||||
Net unrealized gains on securities | (509.9 | ) | (464.5 | ) | ||||||||||||||
Hedges on forecasted transactions | (2.2 | ) | (3.3 | ) | ||||||||||||||
Deferred acquisition costs | (156.7 | ) | (152.1 | ) | ||||||||||||||
Property and equipment | (99.6 | ) | (103.6 | ) | ||||||||||||||
Prepaid expenses | (14.4 | ) | (12.2 | ) | ||||||||||||||
Deferred gain on extinguishment of debt | (4.8 | ) | (5.8 | ) | ||||||||||||||
Other | (4.0 | ) | (4.5 | ) | ||||||||||||||
Net deferred tax asset (liability) | $ | (28.4 | ) | $ | 109.4 | |||||||||||||
Loss_And_Loss_Adjustment_Expen1
Loss And Loss Adjustment Expense Reserves (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Activity in Loss and Loss Adjustment Expense Reserves | ' | |||||||||
Activity in the loss and loss adjustment expense reserves is summarized as follows: | ||||||||||
(millions) | 2013 | 2012 | 2011 | |||||||
Balance at January 1 | $ | 7,838.40 | $ | 7,245.80 | $ | 7,071.00 | ||||
Less reinsurance recoverables on unpaid losses | 862.1 | 785.7 | 704.1 | |||||||
Net balance at January 1 | 6,976.30 | 6,460.10 | 6,366.90 | |||||||
Incurred related to: | ||||||||||
Current year | 12,427.30 | 11,926.00 | 10,876.80 | |||||||
Prior years | 45.1 | 22 | (242.0 | ) | ||||||
Total incurred | 12,472.40 | 11,948.00 | 10,634.80 | |||||||
Paid related to: | ||||||||||
Current year | 8,095.00 | 7,895.30 | 7,289.30 | |||||||
Prior years | 3,919.90 | 3,536.50 | 3,252.30 | |||||||
Total paid | 12,014.90 | 11,431.80 | 10,541.60 | |||||||
Net balance at December 31 | 7,433.80 | 6,976.30 | 6,460.10 | |||||||
Plus reinsurance recoverables on unpaid losses | 1,045.90 | 862.1 | 785.7 | |||||||
Balance at December 31 | $ | 8,479.70 | $ | 7,838.40 | $ | 7,245.80 | ||||
Reinsurance_Tables
Reinsurance (Tables) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||
Reinsurance Disclosures [Abstract] | ' | |||||||||||||||||||||||
Effect of Reinsurance on Premiums Written and Earned | ' | |||||||||||||||||||||||
The effect of reinsurance on premiums written and earned for the years ended December 31, was as follows: | ||||||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||||||
(millions) | Written | Earned | Written | Earned | Written | Earned | ||||||||||||||||||
Direct premiums | $ | 17,562.80 | $ | 17,317.90 | $ | 16,558.80 | $ | 16,207.60 | $ | 15,333.10 | $ | 15,107.50 | ||||||||||||
Ceded | (223.1 | ) | (214.5 | ) | (186.1 | ) | (189.6 | ) | (186.5 | ) | (204.7 | ) | ||||||||||||
Net premiums | $ | 17,339.70 | $ | 17,103.40 | $ | 16,372.70 | $ | 16,018.00 | $ | 15,146.60 | $ | 14,902.80 | ||||||||||||
Prepaid Reinsurance Premiums and Reinsurance Recoverables | ' | |||||||||||||||||||||||
Our prepaid reinsurance premiums and reinsurance recoverables were comprised of the following at December 31: | ||||||||||||||||||||||||
Prepaid Reinsurance Premiums | Reinsurance Recoverables | |||||||||||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||
MCCA | $ | 29.5 | 40 | % | $ | 25.4 | 38 | % | $ | 875.9 | 80 | % | $ | 739.2 | 82 | % | ||||||||
CAIP | 21.1 | 28 | 15.4 | 23 | 79.3 | 7 | 66.3 | 7 | ||||||||||||||||
NCRF | 20.5 | 27 | 19.5 | 30 | 50.1 | 5 | 50.6 | 6 | ||||||||||||||||
State Plans | 71.1 | 95 | 60.3 | 91 | 1,005.30 | 92 | 856.1 | 95 | ||||||||||||||||
Non-State Plans | 3.8 | 5 | 6 | 9 | 84.9 | 8 | 44.9 | 5 | ||||||||||||||||
Total | $ | 74.9 | 100 | % | $ | 66.3 | 100 | % | $ | 1,090.20 | 100 | % | $ | 901 | 100 | % | ||||||||
Employee_Benefit_Plans_Tables
Employee Benefit Plans (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Amounts Charged to Income for Employees Incentive Compensation Plans | ' | ||||||||||||||||||||
The amounts charged to income for the incentive compensation plans for the years ended December 31, were: | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
(millions) | Pretax | After Tax | Pretax | After Tax | Pretax | After Tax | |||||||||||||||
Cash | $ | 234.5 | $ | 152.4 | $ | 207 | $ | 134.6 | $ | 196.1 | $ | 127.5 | |||||||||
Equity | 64.9 | 42.2 | 63.4 | 41.2 | 50.5 | 32.8 | |||||||||||||||
Assets Held in Deferral Plan Irrevocable Grantor Trust Account | ' | ||||||||||||||||||||
The Deferral Plan Irrevocable Grantor Trust account held the following assets at December 31: | |||||||||||||||||||||
(millions) | 2013 | 2012 | |||||||||||||||||||
Progressive common shares1 | $ | 57.1 | $ | 53.3 | |||||||||||||||||
Other investment funds2 | 113.1 | 73.4 | |||||||||||||||||||
Total | $ | 170.2 | $ | 126.7 | |||||||||||||||||
1 Includes 2.5 million and 1.3 million common shares as of December 31, 2013 and 2012, respectively, to be distributed in common shares. | |||||||||||||||||||||
2 Amount is included in other assets on the balance sheet. | |||||||||||||||||||||
Director | ' | ||||||||||||||||||||
Summary of Restricted Stock Activity | ' | ||||||||||||||||||||
A summary of all directors’ restricted stock activity during the years ended December 31, follows: | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Restricted Stock | Number of | Weighted | Number of | Weighted | Number of | Weighted | |||||||||||||||
Shares | Average | Shares | Average | Shares | Average | ||||||||||||||||
Grant | Grant | Grant | |||||||||||||||||||
Date Fair | Date Fair | Date Fair | |||||||||||||||||||
Value | Value | Value | |||||||||||||||||||
Beginning of year | 92,957 | $ | 21.41 | 94,106 | $ | 21.8 | 109,545 | $ | 20.86 | ||||||||||||
Add (deduct): | |||||||||||||||||||||
Granted | 93,254 | 26.19 | 92,957 | 21.41 | 94,106 | 21.8 | |||||||||||||||
Vested | (92,957 | ) | 21.41 | (94,106 | ) | 21.8 | (109,545 | ) | 20.86 | ||||||||||||
End of year | 93,254 | $ | 26.19 | 92,957 | $ | 21.41 | 94,106 | $ | 21.8 | ||||||||||||
Available, end of year1 | 476,884 | 570,138 | 663,095 | ||||||||||||||||||
1 Represents shares available under the 2003 Directors Equity Incentive Plan. | |||||||||||||||||||||
Summary of Stock Option Activity | ' | ||||||||||||||||||||
A summary of all stock option activity for both current and former directors during the years ended December 31, follows: | |||||||||||||||||||||
2012 | 2011 | ||||||||||||||||||||
Options Outstanding | Number of | Weighted | Number of | Weighted | |||||||||||||||||
Shares | Average | Shares | Average | ||||||||||||||||||
Exercise | Exercise | ||||||||||||||||||||
Price | Price | ||||||||||||||||||||
Beginning of year | 36,237 | $ | 12.51 | 120,125 | $ | 10.34 | |||||||||||||||
Deduct: | |||||||||||||||||||||
Exercised | (36,237 | ) | 12.51 | (83,888 | ) | 9.41 | |||||||||||||||
End of year | 0 | $ | 0 | 36,237 | $ | 12.51 | |||||||||||||||
Exercisable, end of year1 | 0 | $ | 0 | 36,237 | $ | 12.51 | |||||||||||||||
1 The 1998 Directors’ Stock Option Plan has expired. | |||||||||||||||||||||
Employee | ' | ||||||||||||||||||||
Summary of Restricted Stock Activity | ' | ||||||||||||||||||||
A summary of all employee restricted equity award activity during the years ended December 31, follows: | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Restricted Equity Awards | Number of Shares1 | Weighted | Number of | Weighted | Number of | Weighted | |||||||||||||||
Average | Shares1 | Average | Shares1 | Average | |||||||||||||||||
Grant | Grant | Grant | |||||||||||||||||||
Date Fair | Date Fair | Date Fair | |||||||||||||||||||
Value | Value | Value | |||||||||||||||||||
Beginning of year | 11,625,981 | $ | 17.8 | 12,296,847 | $ | 16.86 | 11,681,826 | $ | 16.55 | ||||||||||||
Add (deduct): | |||||||||||||||||||||
Granted2 | 2,738,809 | 22.73 | 2,680,229 | 19.11 | 2,483,461 | 20.03 | |||||||||||||||
Vested | (4,293,605 | ) | 15.54 | (3,188,111 | ) | 15.23 | (1,571,237 | ) | 19.88 | ||||||||||||
Forfeited | (152,610 | ) | 18.28 | (162,984 | ) | 17.93 | (297,203 | ) | 15.41 | ||||||||||||
End of year3,4 | 9,918,575 | $ | 20.13 | 11,625,981 | $ | 17.8 | 12,296,847 | $ | 16.86 | ||||||||||||
Available, end of year5 | 11,139,779 | 15,624,677 | 18,141,922 | ||||||||||||||||||
1 Includes both restricted stock units and restricted stock. Upon vesting, all units will be converted on a one-for-one basis into Progressive common shares funded from existing treasury shares. All performance-based awards are included at their target amounts. | |||||||||||||||||||||
2 In 2010, we began reinvesting dividend equivalents on restricted stock units. For 2013, 2012, and 2011, the number granted includes 161,077, 440,029, and 55,288 units, respectively, at a weighted average grant date fair value of $0, since the dividends were factored into the grant date fair value of the original grant. | |||||||||||||||||||||
3 At December 31, 2013, the number of shares included 2,935,985 performance-based awards at their target amounts. We expect 3,898,809 performance-based awards to vest, based upon our current estimate of the achievement of pre-determined performance goals. | |||||||||||||||||||||
4 At December 31, 2013, the total unrecognized compensation cost related to unvested equity awards was $84.6 million, which includes performance-based awards at their currently estimated vesting value. This compensation expense will be recognized into the income statement over the weighted average vesting period of 2.2 years. | |||||||||||||||||||||
5 Represents shares available under the 2010 Incentive Plan; the 2003 Incentive Plan expired on January 31, 2013, and the remaining 1,898,699 shares thereunder are no longer available for future issuance, however, dividend equivalents will be issued on outstanding awards up to the remaining authorization amount. | |||||||||||||||||||||
Summary of Stock Option Activity | ' | ||||||||||||||||||||
The following table is a summary of all employee stock option activity during the year ended December 31, 2011. All non-qualified stock options vested on or before January 1, 2007 and expired on December 31, 2011. All options granted had an exercise price equal to the market value of the common shares on the date of grant. | |||||||||||||||||||||
2011 | |||||||||||||||||||||
Options Outstanding | Number of | Weighted | |||||||||||||||||||
Shares | Average | ||||||||||||||||||||
Exercise | |||||||||||||||||||||
Price | |||||||||||||||||||||
Beginning of year | 1,916,416 | $ | 11.31 | ||||||||||||||||||
Deduct: | |||||||||||||||||||||
Exercised | (1,913,552 | ) | 11.31 | ||||||||||||||||||
Forfeited | (2,864 | ) | 11.28 | ||||||||||||||||||
End of year | 0 | $ | 0 | ||||||||||||||||||
Exercisable, end of year | 0 | $ | 0 | ||||||||||||||||||
Segment_Information_Tables
Segment Information (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Reconciliation of Revenue and Operating Income from Segments to Consolidated | ' | ||||||||||||||||||||
Following are the operating results for the years ended December 31: | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
(millions) | Revenues | Pretax | Revenues | Pretax | Revenues | Pretax | |||||||||||||||
Profit | Profit | Profit | |||||||||||||||||||
(Loss) | (Loss) | (Loss) | |||||||||||||||||||
Personal Lines | |||||||||||||||||||||
Agency | $ | 8,601.50 | $ | 542.9 | $ | 8,103.90 | $ | 338.9 | $ | 7,627.40 | $ | 564.9 | |||||||||
Direct | 6,740.10 | 473.9 | 6,264.20 | 289.5 | 5,803.70 | 354.4 | |||||||||||||||
Total Personal Lines1 | 15,341.60 | 1,016.80 | 14,368.10 | 628.4 | 13,431.10 | 919.3 | |||||||||||||||
Commercial Lines | 1,761.60 | 114.1 | 1,649.00 | 86.3 | 1,467.10 | 133.5 | |||||||||||||||
Other indemnity | 0.2 | (10.8 | ) | 0.9 | (5.8 | ) | 4.6 | (5.5 | ) | ||||||||||||
Total underwriting operations | 17,103.40 | 1,120.10 | 16,018.00 | 708.9 | 14,902.80 | 1,047.30 | |||||||||||||||
Fees and other revenues2 | 291.8 | NA | 281.8 | NA | 266.5 | NA | |||||||||||||||
Service businesses | 39.6 | 0.8 | 36.1 | 0 | 22.8 | 3.4 | |||||||||||||||
Investments3 | 740.4 | 721.6 | 749.8 | 734.4 | 582.6 | 569.1 | |||||||||||||||
Gains (losses) on extinguishment of debt | (4.3 | ) | (4.3 | ) | (1.8 | ) | (1.8 | ) | (.1 | ) | (.1 | ) | |||||||||
Interest expense | NA | (118.2 | ) | NA | (123.8 | ) | NA | (132.7 | ) | ||||||||||||
Consolidated total | $ | 18,170.90 | $ | 1,720.00 | $ | 17,083.90 | $ | 1,317.70 | $ | 15,774.60 | $ | 1,487.00 | |||||||||
1 Personal auto insurance accounted for 91% of the total Personal Lines segment net premiums earned in 2013, 2012, and 2011; insurance for our special lines products (e.g., motorcycles, ATVs, RVs, mobile homes, watercraft, and snowmobiles) accounted for the balance of the Personal Lines net premiums earned. | |||||||||||||||||||||
2 Pretax profit (loss) for fees and other revenues are allocated to operating segments. | |||||||||||||||||||||
3 Revenues represent recurring investment income and total net realized gains (losses) on securities; pretax profit is net of investment expenses. | |||||||||||||||||||||
NA =font> Not Applicable | |||||||||||||||||||||
Underwriting Margins and Combined Ratios for our Underwriting Operations | ' | ||||||||||||||||||||
Following are the underwriting margins/combined ratios for our underwriting operations for the years ended December 31: | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Underwriting | Combined | Underwriting | Combined | Underwriting | Combined | ||||||||||||||||
Margin | Ratio | Margin | Ratio | Margin | Ratio | ||||||||||||||||
Personal Lines | |||||||||||||||||||||
Agency | 6.3 | % | 93.7 | 4.2 | % | 95.8 | 7.4 | % | 92.6 | ||||||||||||
Direct | 7 | 93 | 4.6 | 95.4 | 6.1 | 93.9 | |||||||||||||||
Total Personal Lines | 6.6 | 93.4 | 4.4 | 95.6 | 6.8 | 93.2 | |||||||||||||||
Commercial Lines | 6.5 | 93.5 | 5.2 | 94.8 | 9.1 | 90.9 | |||||||||||||||
Other indemnity1 | NM | NM | NM | NM | NM | NM | |||||||||||||||
Total underwriting operations | 6.5 | 93.5 | 4.4 | 95.6 | 7 | 93 | |||||||||||||||
1 Underwriting margins/combined ratios are not meaningful (NM) for our other indemnity businesses due to the low level of premiums earned by, and the variability of loss costs in, such businesses. | |||||||||||||||||||||
Other_Comprehensive_Income_Los1
Other Comprehensive Income (Loss) (Tables) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||
Components of Other Comprehensive Income (Loss) | ' | |||||||||||||||||||||||
The components of other comprehensive income (loss) for the years ended December 31, were as follows: | ||||||||||||||||||||||||
Components of Changes in | ||||||||||||||||||||||||
Accumulated Other | ||||||||||||||||||||||||
Comprehensive Income (after tax) | ||||||||||||||||||||||||
(millions) | Pretax total | Total tax | After tax total | Total net | Net | Foreign | ||||||||||||||||||
accumulated | (provision) | accumulated | unrealized | unrealized | currency | |||||||||||||||||||
other | benefit | other | gains (losses) | gains on | translation | |||||||||||||||||||
comprehensive | comprehensive | on securities | forecasted | adjustment | ||||||||||||||||||||
income | income | transactions1,3 | ||||||||||||||||||||||
Balance at December 31, 2012 | $ | 1,340.00 | $ | (469.0 | ) | $ | 871 | $ | 862.7 | $ | 6.1 | $ | 2.2 | |||||||||||
Other comprehensive income (loss) before reclassifications: | ||||||||||||||||||||||||
Investment securities | 368.2 | (128.9 | ) | 239.3 | 239.3 | 0 | 0 | |||||||||||||||||
Net non-credit related OTTI losses, adjusted for valuation changes | 0.4 | (.1 | ) | 0.3 | 0.3 | 0 | 0 | |||||||||||||||||
Forecasted transactions | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Foreign currency translation adjustment | (2.5 | ) | 0.9 | (1.6 | ) | 0 | 0 | (1.6 | ) | |||||||||||||||
Total other comprehensive income (loss) before reclassifications | 366.1 | (128.1 | ) | 238 | 239.6 | 0 | (1.6 | ) | ||||||||||||||||
Less: Reclassification adjustment for amounts realized in net income by income statement line item: | ||||||||||||||||||||||||
Net impairment losses recognized in earnings | (5.7 | ) | 2 | (3.7 | ) | (3.7 | ) | 0 | 0 | |||||||||||||||
Net realized gains (losses) on securities2 | 245.5 | (86.0 | ) | 159.5 | 159 | 0.5 | 0 | |||||||||||||||||
Interest expense3 | 2.2 | (.7 | ) | 1.5 | 0 | 1.5 | 0 | |||||||||||||||||
Total reclassification adjustment for amounts realized in net income | 242 | (84.7 | ) | 157.3 | 155.3 | 2 | 0 | |||||||||||||||||
Total other comprehensive income (loss) | 124.1 | (43.4 | ) | 80.7 | 84.3 | (2.0 | ) | (1.6 | ) | |||||||||||||||
Balance at December 31, 2013 | $ | 1,464.10 | $ | (512.4 | ) | $ | 951.7 | $ | 947 | $ | 4.1 | $ | 0.6 | |||||||||||
Components of Changes in | ||||||||||||||||||||||||
Accumulated Other | ||||||||||||||||||||||||
Comprehensive Income (after tax) | ||||||||||||||||||||||||
(millions) | Pretax total | Total tax | After tax total | Total net | Net | Foreign | ||||||||||||||||||
accumulated | (provision) | accumulated | unrealized | unrealized | currency | |||||||||||||||||||
other | benefit | other | gains (losses) | gains on | translation | |||||||||||||||||||
comprehensive | comprehensive | on securities | forecasted | adjustment | ||||||||||||||||||||
income | income | transactions1 | ||||||||||||||||||||||
Balance at December 31, 2011 | $ | 1,065.40 | $ | (372.9 | ) | $ | 692.5 | $ | 682.8 | $ | 7.9 | $ | 1.8 | |||||||||||
Other comprehensive income (loss) before reclassifications: | ||||||||||||||||||||||||
Investment securities | 488 | (170.8 | ) | 317.2 | 317.2 | 0 | 0 | |||||||||||||||||
Net non-credit related OTTI losses, adjusted for valuation changes | 7.9 | (2.8 | ) | 5.1 | 5.1 | 0 | 0 | |||||||||||||||||
Forecasted transactions | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Foreign currency translation adjustment | 0.6 | (.2 | ) | 0.4 | 0 | 0 | 0.4 | |||||||||||||||||
Total other comprehensive income (loss) before reclassifications | 496.5 | (173.8 | ) | 322.7 | 322.3 | 0 | 0.4 | |||||||||||||||||
Less: Reclassification adjustment for amounts realized in net income by income statement line item: | ||||||||||||||||||||||||
Net impairment losses recognized in earnings | (.4 | ) | 0.1 | (.3 | ) | (.3 | ) | 0 | 0 | |||||||||||||||
Net realized gains (losses) on securities2 | 220.1 | (77.0 | ) | 143.1 | 142.7 | 0.4 | 0 | |||||||||||||||||
Interest expense | 2.2 | (.8 | ) | 1.4 | 0 | 1.4 | 0 | |||||||||||||||||
Total reclassification adjustment for amounts realized in net income | 221.9 | (77.7 | ) | 144.2 | 142.4 | 1.8 | 0 | |||||||||||||||||
Total other comprehensive income (loss) | 274.6 | (96.1 | ) | 178.5 | 179.9 | (1.8 | ) | 0.4 | ||||||||||||||||
Balance at December 31, 2012 | $ | 1,340.00 | $ | (469.0 | ) | $ | 871 | $ | 862.7 | $ | 6.1 | $ | 2.2 | |||||||||||
Components of Changes in | ||||||||||||||||||||||||
Accumulated Other | ||||||||||||||||||||||||
Comprehensive Income (after tax) | ||||||||||||||||||||||||
(millions) | Pretax total | Total tax | After tax total | Total net | Net | Foreign | ||||||||||||||||||
accumulated | (provision) | accumulated | unrealized | unrealized | currency | |||||||||||||||||||
other | benefit | other | gains (losses) | gains on | translation | |||||||||||||||||||
comprehensive | comprehensive | on securities | forecasted | adjustment | ||||||||||||||||||||
income | income | transactions1 | ||||||||||||||||||||||
Balance at December 31, 2010 | $ | 1,205.60 | $ | (421.9 | ) | $ | 783.7 | $ | 767.3 | $ | 14.7 | $ | 1.7 | |||||||||||
Other comprehensive income (loss) before reclassifications: | ||||||||||||||||||||||||
Investment securities | 75.4 | (26.4 | ) | 49 | 49 | 0 | 0 | |||||||||||||||||
Net non-credit related OTTI losses, adjusted for valuation changes | (5.5 | ) | 1.9 | (3.6 | ) | (3.6 | ) | 0 | 0 | |||||||||||||||
Forecasted transactions | (5.1 | ) | 1.8 | (3.3 | ) | 0 | (3.3 | ) | 0 | |||||||||||||||
Foreign currency translation adjustment | 0.2 | (.1 | ) | 0.1 | 0 | 0 | 0.1 | |||||||||||||||||
Total other comprehensive income (loss) before reclassifications | 65 | (22.8 | ) | 42.2 | 45.4 | (3.3 | ) | 0.1 | ||||||||||||||||
Less: Reclassification adjustment for amounts realized in net income by income statement line item: | ||||||||||||||||||||||||
Net impairment losses recognized in earnings | (.6 | ) | 0.2 | (.4 | ) | (.4 | ) | 0 | 0 | |||||||||||||||
Net realized gains (losses) on securities2 | 200.8 | (70.3 | ) | 130.5 | 130.3 | 0.2 | 0 | |||||||||||||||||
Interest expense | 5 | (1.7 | ) | 3.3 | 0 | 3.3 | 0 | |||||||||||||||||
Total reclassification adjustment for amounts realized in net income | 205.2 | (71.8 | ) | 133.4 | 129.9 | 3.5 | 0 | |||||||||||||||||
Total other comprehensive income (loss) | (140.2 | ) | 49 | (91.2 | ) | (84.5 | ) | (6.8 | ) | 0.1 | ||||||||||||||
Balance at December 31, 2011 | $ | 1,065.40 | $ | (372.9 | ) | $ | 692.5 | $ | 682.8 | $ | 7.9 | $ | 1.8 | |||||||||||
1 Entered into for the purpose of managing interest rate risk associated with our debt issuances. | ||||||||||||||||||||||||
2 During 2013, 2012, and 2011, we reclassified $0.8 million, $0.6 million, and $0.3 million, respectively, on a pretax basis, from accumulated other comprehensive income on the balance sheet to net realized gains on securities on the comprehensive income statement, reflecting the portion of the unrealized gain on forecasted transactions that was related to the portion of the 6.70% Debentures repurchased during the periods (see Note 4 – Debt for further discussion). | ||||||||||||||||||||||||
3 We expect to reclassify $2.1 million (pretax) into income during the next 12 months, related to net unrealized gains on forecasted transactions. |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Minimum Commitments under Noncancelable Operating Lease Agreements | ' | |||
The minimum commitments under these agreements at December 31, 2013, were as follows: | ||||
(millions) | Commitments | |||
2014 | $ | 46 | ||
2015 | 38.2 | |||
2016 | 27.6 | |||
2017 | 16.1 | |||
2018 | 9.5 | |||
Thereafter | 7.2 | |||
Total | $ | 144.6 | ||
Expense Incurred for Leases | ' | |||
The expense we incurred for the leases disclosed above, as well as other operating leases that may be cancelable or have terms less than one year, was: | ||||
(millions) | Expense | |||
2013 | $ | 64.6 | ||
2012 | 71.9 | |||
2011 | 80.8 | |||
SCHEDULE_I_Summary_Of_Investme1
SCHEDULE I - Summary Of Investments - Other Than Investments in Related Parties Summary Of Investments - Other than Investments In Related Parties (Detail) (USD $) | Dec. 31, 2013 | |
In Millions, unless otherwise specified | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | $16,584.70 | |
Fair Value | 18,054.70 | |
Amount At Which Shown In The Balance Sheet | 18,054.70 | |
Fixed maturities | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 13,415.30 | |
Fair Value | 13,540.40 | |
Amount At Which Shown In The Balance Sheet | 13,540.40 | |
Fixed maturities | Bonds | US Government and Government Agencies and Authorities | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 3,630.40 | |
Fair Value | 3,662.20 | |
Amount At Which Shown In The Balance Sheet | 3,662.20 | |
Fixed maturities | Bonds | State and local government obligations | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 2,247.30 | |
Fair Value | 2,256 | |
Amount At Which Shown In The Balance Sheet | 2,256 | |
Fixed maturities | Bonds | Foreign government obligations | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 15.6 | |
Fair Value | 15.6 | |
Amount At Which Shown In The Balance Sheet | 15.6 | |
Fixed maturities | Bonds | Public Utility, Bonds | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 96.3 | |
Fair Value | 100 | |
Amount At Which Shown In The Balance Sheet | 100 | |
Fixed maturities | Bonds | Corporate And Other Debt Securities | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 2,788.70 | |
Fair Value | 2,826.60 | |
Amount At Which Shown In The Balance Sheet | 2,826.60 | |
Fixed maturities | Bonds | Asset-backed Securities | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 4,337.50 | |
Fair Value | 4,366.10 | |
Amount At Which Shown In The Balance Sheet | 4,366.10 | |
Fixed maturities | Redeemable preferred stocks | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 299.5 | |
Fair Value | 313.9 | |
Amount At Which Shown In The Balance Sheet | 313.9 | |
Equity securities | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 1,896.80 | |
Fair Value | 3,241.70 | |
Amount At Which Shown In The Balance Sheet | 3,241.70 | |
Equity securities | Common Stocks, by Industry | Utilities | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 106.7 | |
Fair Value | 156.4 | |
Amount At Which Shown In The Balance Sheet | 156.4 | |
Equity securities | Common Stocks, by Industry | Financials | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 208.1 | |
Fair Value | 332.4 | |
Amount At Which Shown In The Balance Sheet | 332.4 | |
Equity securities | Common Stocks, by Industry | Industrials | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 1,136.30 | |
Fair Value | 2,041.70 | |
Amount At Which Shown In The Balance Sheet | 2,041.70 | |
Equity securities | Nonredeemable preferred stocks | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 445.7 | |
Fair Value | 711.2 | |
Amount At Which Shown In The Balance Sheet | 711.2 | |
Short-term investments | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 1,272.60 | [1] |
Fair Value | 1,272.60 | [1] |
Amount At Which Shown In The Balance Sheet | $1,272.60 | [1] |
[1] | Includes $6.3 million in treasury bills issued by the Australian government. |
SCHEDULE_I_Summary_Of_Investme2
SCHEDULE I - Summary Of Investments - Other Than Investments in Related Parties Summary Of Investments - Other than Investments In Related Parties (Parenthetical) (Detail) (USD $) | Dec. 31, 2013 | |
In Millions, unless otherwise specified | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | $16,584.70 | |
Fair Value | 18,054.70 | |
Amount At Which Shown In The Balance Sheet | 18,054.70 | |
Short-term investments | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 1,272.60 | [1] |
Fair Value | 1,272.60 | [1] |
Amount At Which Shown In The Balance Sheet | 1,272.60 | [1] |
Short-term investments | Foreign Government Debt | ' | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ' | |
Cost | 6.3 | |
Fair Value | 6.3 | |
Amount At Which Shown In The Balance Sheet | $6.30 | |
[1] | Includes $6.3 million in treasury bills issued by the Australian government. |
SCHEDULE_II_Condensed_Financia1
SCHEDULE II - Condensed Financial Information Of Registrant Condensed Statements Of Comprehensive Income (Parent Company) (Detail) (USD $) | 12 Months Ended | |||||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||
Revenues | ' | ' | ' | |||
Gains (losses) on extinguishment of debt | ($4.30) | ($1.80) | ($0.10) | |||
Total revenues | 18,170.90 | 17,083.90 | 15,774.60 | |||
Expenses | ' | ' | ' | |||
Interest expense | 118.2 | 123.8 | 132.7 | |||
Total expenses | 16,450.90 | 15,766.20 | 14,287.60 | |||
Income before income taxes | 1,720 | 1,317.70 | 1,487 | |||
Provision (benefit) for income taxes | 554.6 | 415.4 | 471.5 | |||
Net income | 1,165.40 | 902.3 | 1,015.50 | |||
Other comprehensive income (loss) | 80.7 | 178.5 | -91.2 | |||
Comprehensive income | 1,246.10 | 1,080.80 | 924.3 | |||
Parent Company | ' | ' | ' | |||
Revenues | ' | ' | ' | |||
Dividends from subsidiaries | 1,119.70 | 782.3 | 875.3 | |||
Undistributed income (loss) from subsidiaries | 117.5 | 193.1 | 225.7 | |||
Equity in net income of subsidiaries | 1,237.20 | [1] | 975.4 | [1] | 1,101 | [1] |
Intercompany investment income | 2.8 | [1] | 6.1 | [1] | 5.6 | [1] |
Gains (losses) on extinguishment of debt | -4.3 | -1.8 | -0.1 | |||
Other Income | 2.6 | [2] | 0 | [2] | 0 | [2] |
Total revenues | 1,238.30 | 979.7 | 1,106.50 | |||
Expenses | ' | ' | ' | |||
Interest expense | 121.2 | 126.3 | 138 | |||
Deferred compensation | 9.5 | [3] | 5.5 | [3] | 0.4 | [3] |
Other operating costs and expenses | 4 | 3.7 | 4.7 | |||
Total expenses | 134.7 | 135.5 | 143.1 | |||
Income before income taxes | 1,103.60 | 844.2 | 963.4 | |||
Provision (benefit) for income taxes | -61.8 | -58.1 | -52.1 | |||
Net income | 1,165.40 | 902.3 | 1,015.50 | |||
Other comprehensive income (loss) | 80.7 | 178.5 | -91.2 | |||
Comprehensive income | $1,246.10 | $1,080.80 | $924.30 | |||
[1] | Eliminated in consolidation. | |||||
[2] | Represents gain on net death benefit received on life insurance policies. | |||||
[3] | See Note 4 – Employee Benefit Plans in these condensed financial statements. |
SCHEDULE_II_Condensed_Financia2
SCHEDULE II - Condensed Financial Information Of Registrant Condensed Balance Sheets (Parent Company) (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | ||
In Millions, unless otherwise specified | ||||||
Assets | ' | ' | ' | ' | ||
Net deferred income taxes | $0 | $109.40 | ' | ' | ||
Other assets | 304.3 | 321.5 | ' | ' | ||
Total assets | 24,408.20 | 22,694.70 | ' | ' | ||
Liabilities and Shareholders' Equity | ' | ' | ' | ' | ||
Accounts payable, accrued expenses, and other liabilities | 1,785 | [1] | 1,683.50 | [1] | ' | ' |
Dividend payable | 890.2 | 172 | ' | ' | ||
Debt | 1,860.90 | [2] | 2,063.10 | [2] | ' | ' |
Total liabilities | 18,218.70 | 16,687.70 | ' | ' | ||
Common shares, $1.00 par value (authorized 900.0; issued 797.6 and 797.7, including treasury shares of 201.8 and 193.1) | 595.8 | 604.6 | ' | ' | ||
Paid-in capital | 1,142 | 1,077 | ' | ' | ||
Retained earnings | 3,500 | 3,454.40 | ' | ' | ||
Total accumulated other comprehensive income | 951.7 | 871 | 692.5 | 783.7 | ||
Total shareholders' equity | 6,189.50 | 6,007 | 5,806.70 | ' | ||
Total Liabilities and Shareholders' Equity | 24,408.20 | 22,694.70 | ' | ' | ||
Parent Company | ' | ' | ' | ' | ||
Assets | ' | ' | ' | ' | ||
Investment in affiliate | 5 | 1 | ' | ' | ||
Investment in subsidiaries | 6,923.50 | [3] | 6,648.60 | [3] | ' | ' |
Receivable from investment subsidiary | 1,648.40 | [3] | 1,322.90 | [3] | ' | ' |
Intercompany receivable | 307.6 | [3] | 296.2 | [3] | ' | ' |
Net deferred income taxes | 69.1 | 48.3 | ' | ' | ||
Other assets | 141.8 | 82 | ' | ' | ||
Total assets | 9,095.40 | 8,399 | ' | ' | ||
Liabilities and Shareholders' Equity | ' | ' | ' | ' | ||
Accounts payable, accrued expenses, and other liabilities | 154.8 | 156.9 | ' | ' | ||
Dividend payable | 890.2 | 172 | ' | ' | ||
Debt | 1,860.90 | 2,063.10 | ' | ' | ||
Total liabilities | 2,905.90 | 2,392 | ' | ' | ||
Common shares, $1.00 par value (authorized 900.0; issued 797.6 and 797.7, including treasury shares of 201.8 and 193.1) | 595.8 | 604.6 | ' | ' | ||
Paid-in capital | 1,142 | 1,077 | ' | ' | ||
Retained earnings | 3,500 | 3,454.40 | ' | ' | ||
Total accumulated other comprehensive income | 951.7 | 871 | ' | ' | ||
Total shareholders' equity | 6,189.50 | 6,007 | ' | ' | ||
Total Liabilities and Shareholders' Equity | $9,095.40 | $8,399 | ' | ' | ||
[1] | See Note 12 – Litigation and Note 13 – Commitments and Contingencies for further discussion. | |||||
[2] | Consists of both short- and long-term debt. See Note 4 – Debt for further discussion. | |||||
[3] | Eliminated in consolidation. |
SCHEDULE_II_Condensed_Financia3
SCHEDULE II - Condensed Financial Information Of Registrant Condensed Balance Sheets (Parent Company) (Parenthetical) (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, except Per Share data, unless otherwise specified | ||
Condensed Financial Statements, Captions [Line Items] | ' | ' |
Common Shares, par value (USD per share) | $1 | $1 |
Common Shares, authorized (shares) | 900 | 900 |
Common Shares, issued (shares) | 797.6 | 797.7 |
Common Shares, treasury shares (shares) | 201.8 | 193.1 |
Parent Company | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' |
Common Shares, par value (USD per share) | $1 | $1 |
Common Shares, authorized (shares) | 900 | 900 |
Common Shares, issued (shares) | 797.6 | 797.7 |
Common Shares, treasury shares (shares) | 201.8 | 193.1 |
SCHEDULE_II_Condensed_Financia4
SCHEDULE II - Condensed Financial Information Of Registrant Condensed Statements Of Cash Flows (Parent Company) (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Cash Flows From Operating Activities: | ' | ' | ' |
Net income | $1,165,400,000 | $902,300,000 | $1,015,500,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' |
Amortization of equity-based compensation | 64,900,000 | 63,400,000 | 50,500,000 |
(Gains) losses on extinguishment of debt | 4,300,000 | 1,800,000 | 100,000 |
Changes in: | ' | ' | ' |
Accounts payable, accrued expenses, and other liabilities | 165,000,000 | 123,600,000 | 35,500,000 |
Income taxes | 57,800,000 | 19,800,000 | 28,400,000 |
Other, net | -28,100,000 | -10,400,000 | 5,900,000 |
Net cash provided by operating activities | 1,899,900,000 | 1,691,400,000 | 1,497,900,000 |
Cash Flows From Investing Activities: | ' | ' | ' |
Net cash provided by (used in) investing activities | -1,356,500,000 | -264,900,000 | -744,900,000 |
Cash Flows From Financing Activities: | ' | ' | ' |
Proceeds from exercise of stock options | 0 | 500,000 | 22,400,000 |
Tax benefit from exercise/vesting of equity-based compensation | 10,300,000 | 5,800,000 | 6,400,000 |
Net proceeds from debt issuance | 0 | 0 | 491,900,000 |
Payment of debt | -150,000,000 | -350,000,000 | 0 |
Reacquisition of debt | -58,100,000 | -32,500,000 | -15,000,000 |
Acquisition of treasury shares | -273,400,000 | -174,200,000 | -997,800,000 |
Net cash used in financing activities | -646,800,000 | -1,404,100,000 | -755,700,000 |
Increase (decrease) in cash | -104,000,000 | 23,400,000 | -3,200,000 |
Cash, Beginning of year | 179,100,000 | 155,700,000 | 158,900,000 |
Cash, End of year | 75,100,000 | 179,100,000 | 155,700,000 |
Parent Company | ' | ' | ' |
Cash Flows From Operating Activities: | ' | ' | ' |
Net income | 1,165,400,000 | 902,300,000 | 1,015,500,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' |
Undistributed (income) loss from subsidiaries | -117,500,000 | -193,100,000 | -225,700,000 |
Amortization of equity-based compensation | 2,100,000 | 2,000,000 | 2,100,000 |
(Gains) losses on extinguishment of debt | 4,300,000 | 1,800,000 | 100,000 |
Changes in: | ' | ' | ' |
Intercompany receivable | -11,400,000 | -58,600,000 | -58,500,000 |
Accounts payable, accrued expenses, and other liabilities | 19,400,000 | 300,000 | 4,500,000 |
Income taxes | -55,800,000 | 21,700,000 | -3,400,000 |
Other, net | -16,300,000 | -9,900,000 | 4,200,000 |
Net cash provided by operating activities | 990,200,000 | 666,500,000 | 738,800,000 |
Cash Flows From Investing Activities: | ' | ' | ' |
Additional investments in equity securities of consolidated subsidiaries | -13,900,000 | -36,100,000 | -11,800,000 |
Payments for Advance to Affiliate | -4,000,000 | 0 | 0 |
(Paid to) received from investment subsidiary | -325,500,000 | 773,700,000 | 23,600,000 |
Net cash provided by (used in) investing activities | -343,400,000 | 737,600,000 | 11,800,000 |
Cash Flows From Financing Activities: | ' | ' | ' |
Proceeds from exercise of stock options | 0 | 500,000 | 22,400,000 |
Tax benefit from exercise/vesting of equity-based compensation | 10,300,000 | 5,800,000 | 6,400,000 |
Net proceeds from debt issuance | 0 | 0 | 497,000,000 |
Payment of debt | -150,000,000 | -350,000,000 | 0 |
Reacquisition of debt | -58,100,000 | -32,500,000 | -15,000,000 |
Dividends paid to shareholders | -175,600,000 | -853,700,000 | -263,600,000 |
Acquisition of treasury shares | -273,400,000 | -174,200,000 | -997,800,000 |
Net cash used in financing activities | -646,800,000 | -1,404,100,000 | -750,600,000 |
Increase (decrease) in cash | 0 | 0 | 0 |
Cash, Beginning of year | 0 | 0 | 0 |
Cash, End of year | $0 | $0 | $0 |
SCHEDULE_II_Condensed_Financia5
SCHEDULE II - Condensed Financial Information Of Registrant Condensed Financial Information Of Registrant - Additional Information (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Billions, unless otherwise specified | ||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | ' | ' |
Securities Held in Consolidated Non-Insurance Subsidiary | $1.80 | $1.40 |
SCHEDULE_II_Condensed_Financia6
SCHEDULE II - Condensed Financial Information Of Registrant Progressive Corporation Cash Paid (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Disclosure Progressive Corporation Cash Paid [Abstract] | ' | ' | ' |
Income Taxes | $497 | $389.10 | $435 |
Interest | $122.30 | $135 | $129.50 |
SCHEDULE_III_Supplementary_Ins1
SCHEDULE III - Supplementary Insurance Information Supplementary Insurance Information (Detail) (USD $) | 12 Months Ended | |||||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||
Supplementary Insurance Information, by Segment [Line Items] | ' | ' | ' | |||
Deferred policy acquisition costs | $447.60 | [1] | $434.50 | [1] | $433.60 | [1] |
Future policy benefits, losses, claims, and loss expenses | 8,479.70 | [1] | 7,838.40 | [1] | 7,245.80 | [1] |
Unearned premiums | 5,174.50 | [1] | 4,930.70 | [1] | 4,579.40 | [1] |
Other policy claims and benefits payable | 0 | [1] | 0 | [1] | 0 | [1] |
Premium revenue | 17,103.40 | 16,018 | 14,902.80 | |||
Net investment income | 403.2 | [1],[2] | 427.6 | [1],[2] | 466.5 | [1],[2] |
Benefits, claims, losses, and settlement expenses | 12,472.40 | 11,948 | 10,634.80 | |||
Amortization of deferred policy acquisition costs | 1,451.80 | 1,436.60 | 1,399.20 | |||
Other operating expenses | 2,350.90 | 2,206.30 | 2,088 | |||
Net premiums written | 17,339.70 | 16,372.70 | 15,146.60 | |||
Personal Lines | ' | ' | ' | |||
Supplementary Insurance Information, by Segment [Line Items] | ' | ' | ' | |||
Premium revenue | 15,341.60 | 14,368.10 | 13,431.10 | |||
Benefits, claims, losses, and settlement expenses | 11,194.60 | 10,745.30 | 9,615.20 | |||
Amortization of deferred policy acquisition costs | 1,257.50 | 1,250.40 | 1,231.90 | |||
Other operating expenses | 2,149.20 | 2,010.50 | 1,915.60 | |||
Net premiums written | 15,569.20 | 14,636.80 | 13,612.20 | |||
Commercial Lines | ' | ' | ' | |||
Supplementary Insurance Information, by Segment [Line Items] | ' | ' | ' | |||
Premium revenue | 1,761.60 | 1,649 | 1,467.10 | |||
Benefits, claims, losses, and settlement expenses | 1,267.30 | 1,196.60 | 1,010.70 | |||
Amortization of deferred policy acquisition costs | 194.3 | 186.2 | 166.6 | |||
Other operating expenses | 201.2 | 195.2 | 171.9 | |||
Net premiums written | 1,770.50 | 1,735.90 | 1,534.30 | |||
Other Indemnity | ' | ' | ' | |||
Supplementary Insurance Information, by Segment [Line Items] | ' | ' | ' | |||
Premium revenue | 0.2 | 0.9 | 4.6 | |||
Benefits, claims, losses, and settlement expenses | 10.5 | 6.1 | 8.9 | |||
Amortization of deferred policy acquisition costs | 0 | 0 | 0.7 | |||
Other operating expenses | 0.5 | 0.6 | 0.5 | |||
Net premiums written | $0 | $0 | $0.10 | |||
[1] | Progressive does not allocate assets, liabilities, or investment income to operating segments. | |||||
[2] | Excludes total net realized gains (losses) on securities. |
SCHEDULE_IV_Reinsurance_Reinsu
SCHEDULE IV - Reinsurance Reinsurance (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' | ' |
Gross Amount | $17,317,900,000 | $16,207,600,000 | $15,107,500,000 |
Ceded to Other Companies | 214,500,000 | 189,600,000 | 204,700,000 |
Property, Liability and Casualty Insurance Segment | ' | ' | ' |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' | ' |
Gross Amount | 17,317,900,000 | 16,207,600,000 | 15,107,500,000 |
Ceded to Other Companies | 214,500,000 | 189,600,000 | 204,700,000 |
Assumed From Other Companies | 0 | 0 | 0 |
Net Amount | $17,103,400,000 | $16,018,000,000 | $14,902,800,000 |
Percentage of Amount Assumed to Net | 0.00% | 0.00% | 0.00% |
SCHEDULE_VISupplemental_Inform1
SCHEDULE VI-Supplemental Information Concerning Property - Casualty Insurance Operations Supplemental Information Concerning Property - Casualty Insurance Operations (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Supplementary Insurance Information, by Segment [Line Items] | ' | ' | ' |
Losses and Loss Adjustment Expenses Incurred Related to Current Year | $12,427.30 | $11,926 | $10,876.80 |
Losses and Loss Adjustment Expenses Incurred Related to Prior Years | 45.1 | 22 | -242 |
Paid Losses and Loss Adjustment Expenses | $12,014.90 | $11,431.80 | $10,541.60 |
Reporting_And_Accounting_Polic3
Reporting And Accounting Policies Advertising Costs (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Advertising Costs [Line Items] | ' | ' | ' |
Advertising Expense | $619.30 | $546.80 | $543 |
Reporting_And_Accounting_Polic4
Reporting And Accounting Policies Interest Capitalized (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Capitalized Interest [Line Items] | ' | ' | ' |
Capitalized Interest | $0.80 | $0.30 | $0.40 |
Reporting_And_Accounting_Polic5
Reporting And Accounting Policies Equity Based Compensation (Detail) (Stock Compensation Plan, USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Stock Compensation Plan | ' | ' | ' |
Incentive Compensation Plans Expense [Line Items] | ' | ' | ' |
Pretax expense | $64.90 | $63.40 | $50.50 |
Tax benefit | $22.70 | $22.20 | $17.70 |
Reporting_And_Accounting_Polic6
Reporting And Accounting Policies Supplemental Cash Flow Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Schedule of Cash Flow, Supplemental [Line Items] | ' | ' | ' |
Income Taxes | $497 | $389.10 | $435 |
Interest | $122.30 | $135 | $129.50 |
Reporting_And_Accounting_Polic7
Reporting And Accounting Policies - Additional Information (Detail) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 |
Entity | Lower Limit | Upper Limit | computer equipment and laptop computers | computer equipment and laptop computers | Building, Building Improvements, and Integrated Components | Building, Building Improvements, and Integrated Components | Property, Plant and Equipment, Other Types | Property, Plant and Equipment, Other Types | Land and Building | Land and Building | |
Lower Limit | Upper Limit | Lower Limit | Upper Limit | Lower Limit | Upper Limit | ||||||
Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Subsidiaries | 54 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Mutual Insurance Company Affiliates | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Limited Partnership Investment Affiliates | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Auction Rate Securities, Period Between Auction Dates | ' | '7 days | '49 days | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | '2 years | '3 years | '7 years | '40 years | '3 years | '10 years | ' | ' |
Land and buildings as a percentage of total property and equipment | ' | ' | ' | ' | ' | ' | ' | ' | ' | 76.00% | 75.00% |
Investment_Portfolio_by_Major_
Investment Portfolio by Major Security Type (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Millions, unless otherwise specified | ||||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | $16,584.70 | [1],[2] | $15,138.20 | [1],[2] |
Gross Unrealized Gains | 1,582.90 | [1],[2] | 1,361.30 | [1],[2] |
Gross Unrealized Losses | -126 | [1],[2] | -34 | [1],[2] |
Net Realized Gains (Losses) | 13.1 | [1],[2],[3] | 10 | [1],[2],[3] |
Total investments at fair value | 18,054.70 | [1],[2] | 16,475.50 | [1],[2] |
% of Total Fair Value | 100.00% | [1],[2] | 100.00% | [1],[2] |
Fixed maturities | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 13,415.30 | 11,373.90 | ||
Gross Unrealized Gains | 242.4 | 417.7 | ||
Gross Unrealized Losses | -119.1 | -23.7 | ||
Net Realized Gains (Losses) | 1.8 | [3] | 6.2 | [3] |
Total investments at fair value | 13,540.40 | 11,774.10 | ||
% of Total Fair Value | 75.00% | 71.50% | ||
Fixed maturities | U.S. government obligations | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 3,630.40 | 2,806.40 | ||
Gross Unrealized Gains | 48.4 | 90.1 | ||
Gross Unrealized Losses | -16.6 | 0 | ||
Net Realized Gains (Losses) | 0 | [3] | 0 | [3] |
Total investments at fair value | 3,662.20 | 2,896.50 | ||
% of Total Fair Value | 20.30% | 17.60% | ||
Fixed maturities | State and local government obligations | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 2,247.30 | 1,914.40 | ||
Gross Unrealized Gains | 27.1 | 50.6 | ||
Gross Unrealized Losses | -18.4 | -0.6 | ||
Net Realized Gains (Losses) | 0 | [3] | 0 | [3] |
Total investments at fair value | 2,256 | 1,964.40 | ||
% of Total Fair Value | 12.50% | 11.90% | ||
Fixed maturities | Foreign government obligations | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 15.6 | 0 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | 0 | 0 | ||
Net Realized Gains (Losses) | 0 | [3] | 0 | [3] |
Total investments at fair value | 15.6 | 0 | ||
% of Total Fair Value | 0.10% | 0.00% | ||
Fixed maturities | Corporate debt securities | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 2,885 | 2,982.90 | ||
Gross Unrealized Gains | 60.4 | 124.7 | ||
Gross Unrealized Losses | -20.4 | -1 | ||
Net Realized Gains (Losses) | 1.6 | [3] | 6.4 | [3] |
Total investments at fair value | 2,926.60 | 3,113 | ||
% of Total Fair Value | 16.20% | 18.90% | ||
Fixed maturities | Residential mortgage-backed securities | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 1,110.10 | 413.4 | ||
Gross Unrealized Gains | 31.9 | 24 | ||
Gross Unrealized Losses | -14.1 | -9.2 | ||
Net Realized Gains (Losses) | 0 | [3] | 0 | [3] |
Total investments at fair value | 1,127.90 | 428.2 | ||
% of Total Fair Value | 6.20% | 2.60% | ||
Fixed maturities | Commercial mortgage-backed securities | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 2,154.40 | 1,963.90 | ||
Gross Unrealized Gains | 43.9 | 84.9 | ||
Gross Unrealized Losses | -37.8 | -0.1 | ||
Net Realized Gains (Losses) | 0 | [3] | 0 | [3] |
Total investments at fair value | 2,160.50 | 2,048.70 | ||
% of Total Fair Value | 12.00% | 12.40% | ||
Fixed maturities | Other asset-backed securities | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 1,073 | 936 | ||
Gross Unrealized Gains | 6.6 | 12.9 | ||
Gross Unrealized Losses | -2.1 | -0.1 | ||
Net Realized Gains (Losses) | 0.2 | [3] | -0.2 | [3] |
Total investments at fair value | 1,077.70 | 948.6 | ||
% of Total Fair Value | 6.00% | 5.80% | ||
Fixed maturities | Redeemable preferred stocks | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 299.5 | 356.9 | ||
Gross Unrealized Gains | 24.1 | 30.5 | ||
Gross Unrealized Losses | -9.7 | -12.7 | ||
Net Realized Gains (Losses) | 0 | [3] | 0 | [3] |
Total investments at fair value | 313.9 | 374.7 | ||
% of Total Fair Value | 1.70% | 2.30% | ||
Equity securities | Nonredeemable preferred stocks | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 445.7 | 404 | ||
Gross Unrealized Gains | 258.7 | 404.6 | ||
Gross Unrealized Losses | -4.5 | 0 | ||
Net Realized Gains (Losses) | 11.3 | [3] | 3.8 | [3] |
Total investments at fair value | 711.2 | 812.4 | ||
% of Total Fair Value | 3.90% | 4.90% | ||
Equity securities | Common equities | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 1,451.10 | 1,370.30 | ||
Gross Unrealized Gains | 1,081.80 | 539 | ||
Gross Unrealized Losses | -2.4 | -10.3 | ||
Net Realized Gains (Losses) | 0 | [3] | 0 | [3] |
Total investments at fair value | 2,530.50 | 1,899 | ||
% of Total Fair Value | 14.00% | 11.50% | ||
Short-term investments | Other Short-term investments | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cost | 1,272.60 | 1,990 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | 0 | 0 | ||
Net Realized Gains (Losses) | 0 | [3] | 0 | [3] |
Total investments at fair value | $1,272.60 | $1,990 | ||
% of Total Fair Value | 7.10% | 12.10% | ||
[1] | The total fair value of the portfolio included $1.8 billion and $1.4 billion at December 31, 2013 and 2012, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of any unsettled security transactions. | |||
[2] | Reflected in our total portfolio are unsettled security transactions and collateral on open derivative positions, which collectively reflect a liability of $61.3 million at December 31, 2013, compared to an asset of $90.9 million at December 31, 2012. | |||
[3] | Represents net holding period gains (losses) on certain hybrid securities (discussed below). |
Investment_Portfolio_by_Major_1
Investment Portfolio by Major Security Type (Parenthetical) (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Net unsettled security transactions offset in other liabilities | $61,300,000 | ' |
Net unsettled security transactions offset in other assets | ' | 90,900,000 |
Securities in the portfolio of a consolidated, non-insurance subsidiary of the holding company, net of any unsettled security transactions | $1,800,000,000 | $1,400,000,000 |
Investments_Hybrid_Securities_
Investments Hybrid Securities (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Hybrid Securities [Line Items] | ' | ' |
Hybrid securities | $239.30 | $245.30 |
Fixed maturities | ' | ' |
Hybrid Securities [Line Items] | ' | ' |
Hybrid securities | 179 | 192.5 |
Fixed maturities | Corporate debt securities | ' | ' |
Hybrid Securities [Line Items] | ' | ' |
Hybrid securities | 164.2 | 176.1 |
Fixed maturities | Other asset-backed securities | ' | ' |
Hybrid Securities [Line Items] | ' | ' |
Hybrid securities | 14.8 | 16.4 |
Equity securities | Nonredeemable preferred stocks | ' | ' |
Hybrid Securities [Line Items] | ' | ' |
Hybrid securities | $60.30 | $52.80 |
Investments_Composition_of_Fix
Investments Composition of Fixed Maturities by Maturity (Detail) (USD $) | Dec. 31, 2013 | |
In Millions, unless otherwise specified | ||
Available for sale, cost | ' | |
Less than one year | $1,829.30 | |
One to five years | 8,554.80 | |
Five to ten years | 2,860.50 | |
Ten years or greater | 102.6 | |
Total | 13,347.20 | [1] |
Available for sale, Fair value | ' | |
Less than one year | 1,857.60 | |
One to five years | 8,693.60 | |
Five to ten years | 2,812.10 | |
Ten years or greater | 109 | |
Total | $13,472.30 | [1] |
[1] | Excludes $68.1 million related to our open interest rate swap positions. |
Investments_Composition_of_Fix1
Investments Composition of Fixed Maturities by Maturity (Parenthetical) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Millions, unless otherwise specified | ||||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Open interest rate swap positions | $68.10 | [1] | ($95.50) | [1] |
Interest Rate Swaps | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Open interest rate swap positions | $68.10 | ' | ||
[1] | To the extent we hold both derivative assets and liabilities with the same counterparty that are subject to an enforceable master netting arrangement, we expect that we will report them on a gross basis on our balance sheets, consistent with our historical presentation. |
Investments_Gross_Unrealized_l
Investments Gross Unrealized losses by Major Security (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 423 | 196 |
Total Fair Value | $5,723.40 | $746.20 |
Gross Unrealized Losses | -126 | -34 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 346 | 139 |
Less than 12 Months Fair Value | 4,865.90 | 440 |
Less than 12 Months Unrealized Losses | -87.5 | -10.3 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 77 | 57 |
12 Months or Greater Fair Value | 857.5 | 306.2 |
12 Months or Greater Unrealized Losses | -38.5 | -23.7 |
Fixed maturities | ' | ' |
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 392 | 99 |
Total Fair Value | 5,521.40 | 628 |
Gross Unrealized Losses | -119.1 | -23.7 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 319 | 59 |
Less than 12 Months Fair Value | 4,665.10 | 339.3 |
Less than 12 Months Unrealized Losses | -80.6 | -2.1 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 73 | 40 |
12 Months or Greater Fair Value | 856.3 | 288.7 |
12 Months or Greater Unrealized Losses | -38.5 | -21.6 |
Fixed maturities | U.S. government obligations | ' | ' |
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 29 | 0 |
Total Fair Value | 1,444.30 | 0 |
Gross Unrealized Losses | -16.6 | 0 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 28 | 0 |
Less than 12 Months Fair Value | 1,434.60 | 0 |
Less than 12 Months Unrealized Losses | -16.3 | 0 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 1 | 0 |
12 Months or Greater Fair Value | 9.7 | 0 |
12 Months or Greater Unrealized Losses | -0.3 | 0 |
Fixed maturities | State and local government obligations | ' | ' |
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 141 | 44 |
Total Fair Value | 844.2 | 162.8 |
Gross Unrealized Losses | -18.4 | -0.6 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 119 | 37 |
Less than 12 Months Fair Value | 759.3 | 123.1 |
Less than 12 Months Unrealized Losses | -17.1 | -0.5 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 22 | 7 |
12 Months or Greater Fair Value | 84.9 | 39.7 |
12 Months or Greater Unrealized Losses | -1.3 | -0.1 |
Fixed maturities | Corporate debt securities | ' | ' |
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 51 | 8 |
Total Fair Value | 997.6 | 128.2 |
Gross Unrealized Losses | -20.4 | -1 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 45 | 8 |
Less than 12 Months Fair Value | 831.1 | 128.2 |
Less than 12 Months Unrealized Losses | -17.8 | -1 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 6 | 0 |
12 Months or Greater Fair Value | 166.5 | 0 |
12 Months or Greater Unrealized Losses | -2.6 | 0 |
Fixed maturities | Residential mortgage-backed securities | ' | ' |
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 66 | 28 |
Total Fair Value | 763.5 | 149.2 |
Gross Unrealized Losses | -14.1 | -9.2 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 45 | 5 |
Less than 12 Months Fair Value | 597.6 | 40.2 |
Less than 12 Months Unrealized Losses | -7.9 | -0.6 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 21 | 23 |
12 Months or Greater Fair Value | 165.9 | 109 |
12 Months or Greater Unrealized Losses | -6.2 | -8.6 |
Fixed maturities | Commercial mortgage-backed securities | ' | ' |
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 76 | 10 |
Total Fair Value | 1,061.90 | 7.1 |
Gross Unrealized Losses | -37.8 | -0.1 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 60 | 5 |
Less than 12 Months Fair Value | 809.2 | 2.1 |
Less than 12 Months Unrealized Losses | -19.7 | 0 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 16 | 5 |
12 Months or Greater Fair Value | 252.7 | 5 |
12 Months or Greater Unrealized Losses | -18.1 | -0.1 |
Fixed maturities | Other asset-backed securities | ' | ' |
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 25 | 4 |
Total Fair Value | 287.2 | 25 |
Gross Unrealized Losses | -2.1 | -0.1 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 22 | 3 |
Less than 12 Months Fair Value | 233.3 | 20.8 |
Less than 12 Months Unrealized Losses | -1.8 | 0 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 3 | 1 |
12 Months or Greater Fair Value | 53.9 | 4.2 |
12 Months or Greater Unrealized Losses | -0.3 | -0.1 |
Fixed maturities | Redeemable preferred stocks | ' | ' |
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 4 | 5 |
Total Fair Value | 122.7 | 155.7 |
Gross Unrealized Losses | -9.7 | -12.7 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 0 | 1 |
Less than 12 Months Fair Value | 0 | 24.9 |
Less than 12 Months Unrealized Losses | 0 | 0 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 4 | 4 |
12 Months or Greater Fair Value | 122.7 | 130.8 |
12 Months or Greater Unrealized Losses | -9.7 | -12.7 |
Equity securities | ' | ' |
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 31 | 97 |
Total Fair Value | 202 | 118.2 |
Gross Unrealized Losses | -6.9 | -10.3 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 27 | 80 |
Less than 12 Months Fair Value | 200.8 | 100.7 |
Less than 12 Months Unrealized Losses | -6.9 | -8.2 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 4 | 17 |
12 Months or Greater Fair Value | 1.2 | 17.5 |
12 Months or Greater Unrealized Losses | 0 | -2.1 |
Equity securities | Nonredeemable preferred stocks | ' | ' |
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 7 | 0 |
Total Fair Value | 142.3 | 0 |
Gross Unrealized Losses | -4.5 | 0 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 7 | 0 |
Less than 12 Months Fair Value | 142.3 | 0 |
Less than 12 Months Unrealized Losses | -4.5 | 0 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 0 | 0 |
12 Months or Greater Fair Value | 0 | 0 |
12 Months or Greater Unrealized Losses | 0 | 0 |
Equity securities | Common equities | ' | ' |
Investments, Unrealized Loss Position [Line Items] | ' | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 24 | 97 |
Total Fair Value | 59.7 | 118.2 |
Gross Unrealized Losses | -2.4 | -10.3 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | 20 | 80 |
Less than 12 Months Fair Value | 58.5 | 100.7 |
Less than 12 Months Unrealized Losses | -2.4 | -8.2 |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | 4 | 17 |
12 Months or Greater Fair Value | 1.2 | 17.5 |
12 Months or Greater Unrealized Losses | $0 | ($2.10) |
Investments_Total_NonCredit_Po
Investments Total Non-Credit Portion of Other-Than-Temporary Impairment Recorded in Accumulated Other Comprehensive Income, Reflecting Original Non-Credit Loss at Time Credit Impairment (Detail) (Fixed maturities, USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Other Than Temporary Impairment Non Credit Losses Recognized In Accumulated Other Comprehensive Income [Line Items] | ' | ' |
Non-credit portion of other-than-temporary impairments recognized in accumulated other comprehensive income | ($45) | ($45.10) |
Residential mortgage-backed securities | ' | ' |
Other Than Temporary Impairment Non Credit Losses Recognized In Accumulated Other Comprehensive Income [Line Items] | ' | ' |
Non-credit portion of other-than-temporary impairments recognized in accumulated other comprehensive income | -44.1 | -44.2 |
Commercial mortgage-backed securities | ' | ' |
Other Than Temporary Impairment Non Credit Losses Recognized In Accumulated Other Comprehensive Income [Line Items] | ' | ' |
Non-credit portion of other-than-temporary impairments recognized in accumulated other comprehensive income | ($0.90) | ($0.90) |
Investments_OTTI_Credit_Losses
Investments OTTI Credit Losses Recognized in Earnings (Detail) (USD $) | 12 Months Ended | |||||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward] | ' | ' | ' | |||
Beginning balance | $27.70 | $35.80 | $39.80 | |||
Credit losses for which an OTTI was previously recognized | 0.1 | 0.1 | 1.4 | |||
Credit losses for which an OTTI was not previously recognized | 0 | 0.3 | 1.5 | |||
Reductions for securities sold/matured | 0 | -0.2 | 0 | |||
Change in recoveries of future cash flows expected to be collected | -8 | [1],[2] | -4 | [1],[2] | -5.4 | [1],[2] |
Reductions for previously recognized credit impairments written-down to fair value | -0.2 | [3] | -4.3 | [3] | -1.5 | [3] |
Ending balance | 19.6 | 27.7 | 35.8 | |||
Residential mortgage-backed securities | ' | ' | ' | |||
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward] | ' | ' | ' | |||
Beginning balance | 27.1 | 34.5 | 32.3 | |||
Credit losses for which an OTTI was previously recognized | 0.1 | 0.1 | 1.4 | |||
Credit losses for which an OTTI was not previously recognized | 0 | 0.3 | 1.1 | |||
Reductions for securities sold/matured | 0 | 0 | 0 | |||
Change in recoveries of future cash flows expected to be collected | -7.8 | [1],[2] | -3.8 | [1],[2] | 0.8 | [1],[2] |
Reductions for previously recognized credit impairments written-down to fair value | -0.2 | [3] | -4 | [3] | -1.1 | [3] |
Ending balance | 19.2 | 27.1 | 34.5 | |||
Commercial mortgage-backed securities | ' | ' | ' | |||
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward] | ' | ' | ' | |||
Beginning balance | 0.6 | 1.3 | 1 | |||
Credit losses for which an OTTI was previously recognized | 0 | 0 | 0 | |||
Credit losses for which an OTTI was not previously recognized | 0 | 0 | 0.4 | |||
Reductions for securities sold/matured | 0 | -0.2 | 0 | |||
Change in recoveries of future cash flows expected to be collected | -0.2 | [1],[2] | -0.2 | [1],[2] | 0.3 | [1],[2] |
Reductions for previously recognized credit impairments written-down to fair value | 0 | [3] | -0.3 | [3] | -0.4 | [3] |
Ending balance | 0.4 | 0.6 | 1.3 | |||
Corporate debt securities | ' | ' | ' | |||
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward] | ' | ' | ' | |||
Beginning balance | 0 | 0 | 6.5 | |||
Credit losses for which an OTTI was previously recognized | 0 | 0 | 0 | |||
Credit losses for which an OTTI was not previously recognized | 0 | 0 | 0 | |||
Reductions for securities sold/matured | 0 | 0 | 0 | |||
Change in recoveries of future cash flows expected to be collected | 0 | [1],[2] | 0 | [1],[2] | -6.5 | [1],[2] |
Reductions for previously recognized credit impairments written-down to fair value | 0 | [3] | 0 | [3] | 0 | [3] |
Ending balance | $0 | $0 | $0 | |||
[1] | Reflects expected recovery of prior period impairments that will be accreted into income over the remaining life of the security. | |||||
[2] | Includes $2.6 million, $1.4 million, and $2.0 million at December 31, 2013, 2012, and 2011, respectively, received in excess of the cash flows expected to be collected at the time of the write-downs. | |||||
[3] | Reflects reductions of prior credit impairments where the current credit impairment requires writing securities down to fair value (i.e., no remaining non-credit loss). |
Investments_OTTI_Credit_Losses1
Investments OTTI Credit Losses Recognized in Earnings (Parenthetical) (Detail) (USD $) | 12 Months Ended | |||||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items] | ' | ' | ' | |||
Change in recoveries of future cash flows expected to be collected | ($8) | [1],[2] | ($4) | [1],[2] | ($5.40) | [1],[2] |
Residential mortgage-backed securities | ' | ' | ' | |||
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items] | ' | ' | ' | |||
Change in recoveries of future cash flows expected to be collected | -7.8 | [1],[2] | -3.8 | [1],[2] | 0.8 | [1],[2] |
Residential mortgage-backed securities | Actual Cash Flow Recovery | ' | ' | ' | |||
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items] | ' | ' | ' | |||
Change in recoveries of future cash flows expected to be collected | $2.60 | $1.40 | $2 | |||
[1] | Reflects expected recovery of prior period impairments that will be accreted into income over the remaining life of the security. | |||||
[2] | Includes $2.6 million, $1.4 million, and $2.0 million at December 31, 2013, 2012, and 2011, respectively, received in excess of the cash flows expected to be collected at the time of the write-downs. |
Investments_Components_of_Net_
Investments Components of Net Realized Gains (Losses) (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Gross realized gains on securities sales | $271.80 | $360.60 | $255.10 |
Gross realized losses on securities sales | -12.5 | -31.1 | -51.5 |
Net realized gains (losses) on securities sales | 259.3 | 329.5 | 203.6 |
Other-than-temporary impairment losses | -6.1 | -3.5 | -4.1 |
Total net realized gains (losses) on securities | 318.4 | 306.8 | 102.6 |
Fixed maturities | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Gross realized gains on securities sales | 76.9 | 115.4 | 94.6 |
Gross realized losses on securities sales | -11.8 | -2.9 | -15 |
Net realized gains (losses) on securities sales | 65.1 | 112.5 | 79.6 |
Other-than-temporary impairment losses | -0.6 | -1.7 | -3.9 |
Fixed maturities | U.S. government obligations | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Gross realized gains on securities sales | 8.5 | 20.2 | 59.1 |
Gross realized losses on securities sales | -3.7 | -1.9 | -9.3 |
Net realized gains (losses) on securities sales | 4.8 | 18.3 | 49.8 |
Fixed maturities | State and local government obligations | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Gross realized gains on securities sales | 7.7 | 15 | 3.5 |
Net realized gains (losses) on securities sales | 7.7 | 15 | 3.5 |
Fixed maturities | Corporate And Other Debt Securities | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Gross realized gains on securities sales | 47.7 | 58.1 | 23 |
Gross realized losses on securities sales | -6.2 | -0.6 | -3.5 |
Net realized gains (losses) on securities sales | 41.5 | 57.5 | 19.5 |
Fixed maturities | Residential mortgage-backed securities | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Gross realized gains on securities sales | 3 | 1.2 | 2 |
Net realized gains (losses) on securities sales | 3 | 1.2 | 2 |
Other-than-temporary impairment losses | -0.6 | -1.6 | -3.3 |
Fixed maturities | Commercial mortgage-backed securities | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Gross realized gains on securities sales | 10 | 19.3 | 0.3 |
Gross realized losses on securities sales | -1.8 | 0 | 0 |
Net realized gains (losses) on securities sales | 8.2 | 19.3 | 0.3 |
Other-than-temporary impairment losses | 0 | -0.1 | -0.6 |
Fixed maturities | Other asset-backed securities | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Gross realized gains on securities sales | 0 | 0.9 | 2.1 |
Net realized gains (losses) on securities sales | 0 | 0.9 | 2.1 |
Fixed maturities | Redeemable preferred stocks | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Gross realized gains on securities sales | 0 | 0.7 | 4.6 |
Gross realized losses on securities sales | -0.1 | -0.4 | -2.2 |
Net realized gains (losses) on securities sales | -0.1 | 0.3 | 2.4 |
Equity securities | Nonredeemable preferred stocks | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Gross realized gains on securities sales | 126.3 | 78.2 | 148.9 |
Gross realized losses on securities sales | -0.1 | -1.1 | 0 |
Net realized gains (losses) on securities sales | 126.2 | 77.1 | 148.9 |
Equity securities | Common equities | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Gross realized gains on securities sales | 68.6 | 167 | 11.6 |
Gross realized losses on securities sales | -0.6 | -27.1 | -36.5 |
Net realized gains (losses) on securities sales | 68 | 139.9 | -24.9 |
Other-than-temporary impairment losses | -5.5 | -1.8 | -0.2 |
Hybrid and Derivative Instruments and Litigation Settlements | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Other gains (losses) | 65.2 | -19.2 | -96.9 |
Hybrid and Derivative Instruments and Litigation Settlements | Hybrid Preferred Stock | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Other gains (losses) | 6.4 | 14.3 | 1.7 |
Hybrid and Derivative Instruments and Litigation Settlements | Derivative Instruments | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Other gains (losses) | 56.6 | -43.1 | -98.9 |
Hybrid and Derivative Instruments and Litigation Settlements | Litigation Settlements | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' |
Other gains (losses) | $2.20 | $9.60 | $0.30 |
Investments_Components_of_Net_1
Investments Components of Net Investment Income (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | $422 | $443 | $480 |
Investment expenses | -18.8 | -15.4 | -13.5 |
Net investment income | 403.2 | 427.6 | 466.5 |
Fixed maturities | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | 338 | 351.2 | 384.2 |
Fixed maturities | U.S. government obligations | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | 50.2 | 49.8 | 58 |
Fixed maturities | State and local government obligations | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | 48 | 51.1 | 60 |
Fixed maturities | Foreign government obligations | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | 0.2 | 0 | 0 |
Fixed maturities | Corporate debt securities | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | 98.8 | 107.5 | 106.7 |
Fixed maturities | Residential mortgage-backed securities | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | 28.1 | 16.1 | 18.6 |
Fixed maturities | Commercial mortgage-backed securities | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | 74.8 | 82.2 | 83.4 |
Fixed maturities | Other asset-backed securities | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | 16.7 | 20.3 | 24.5 |
Fixed maturities | Redeemable preferred stocks | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | 21.2 | 24.2 | 33 |
Equity securities | Nonredeemable preferred stocks | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | 36.2 | 43.8 | 57.7 |
Equity securities | Common equities | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | 45.8 | 44.9 | 35.7 |
Short-term investments | Other Short-term investments | ' | ' | ' |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ' | ' | ' |
Investment income | $2 | $3.10 | $2.40 |
Investments_Derivative_Instrum
Investments Derivative Instruments (Detail) (USD $) | 12 Months Ended | |||||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||
Derivative [Line Items] | ' | ' | ' | |||
Balance Sheet - Fair Value | $68.10 | [1] | ($95.50) | [1] | ' | |
Income Statement - Net Realized Gain (Loss) on Securities | 56.6 | -43.1 | -98.9 | |||
Designated as Hedging Instruments | Closed Positions | Ineffective Cash Flow Hedge | ' | ' | ' | |||
Derivative [Line Items] | ' | ' | ' | |||
Notional Value | 54 | [2] | 31 | [2] | 15 | [2] |
Purpose | 'Manage interest rate risk | ' | ' | |||
Balance Sheet - Fair Value | 0 | [1] | 0 | [1] | ' | |
Income Statement - Net Realized Gain (Loss) on Securities | 0.8 | 0.6 | 0.3 | |||
Non-hedging Instruments | Closed Positions | Interest Rate Swaps | ' | ' | ' | |||
Derivative [Line Items] | ' | ' | ' | |||
Notional Value | 1,263 | [2] | 0 | [2] | 350 | [2] |
Purpose | 'Manage portfolio duration | ' | ' | |||
Balance Sheet - Fair Value | 0 | [1] | 0 | [1] | ' | |
Income Statement - Net Realized Gain (Loss) on Securities | -4 | 0 | -25.5 | |||
Non-hedging Instruments | Closed Positions | Corporate Credit Default Swaps | ' | ' | ' | |||
Derivative [Line Items] | ' | ' | ' | |||
Notional Value | 0 | [2] | 25 | [2] | 10 | [2] |
Purpose | 'Manage credit risk | ' | ' | |||
Balance Sheet - Fair Value | 0 | [1] | 0 | [1] | ' | |
Income Statement - Net Realized Gain (Loss) on Securities | 0 | -1 | 0.5 | |||
Non-hedging Instruments | Assets | Interest Rate Swaps | Fixed maturities | ' | ' | ' | |||
Derivative [Line Items] | ' | ' | ' | |||
Notional Value | 750 | [2] | 0 | [2] | 0 | [2] |
Purpose | 'Manage portfolio duration | ' | ' | |||
Balance Sheet - Fair Value | 68.1 | [1] | 0 | [1] | ' | |
Income Statement - Net Realized Gain (Loss) on Securities | 59.8 | 0 | 0 | |||
Non-hedging Instruments | Assets | Corporate Credit Default Swaps | Fixed maturities | ' | ' | ' | |||
Derivative [Line Items] | ' | ' | ' | |||
Notional Value | 0 | [2] | 0 | [2] | 25 | [2] |
Purpose | 'Manage credit risk | ' | ' | |||
Balance Sheet - Fair Value | 0 | [1] | 0 | [1] | ' | |
Income Statement - Net Realized Gain (Loss) on Securities | 0 | 0 | -0.2 | |||
Non-hedging Instruments | Liabilities | Interest Rate Swaps | Other Liabilities | ' | ' | ' | |||
Derivative [Line Items] | ' | ' | ' | |||
Notional Value | 0 | [2] | 1,263 | [2] | 1,263 | [2] |
Purpose | 'Manage portfolio duration | ' | ' | |||
Balance Sheet - Fair Value | 0 | [1] | -95.5 | [1] | ' | |
Income Statement - Net Realized Gain (Loss) on Securities | $0 | ($42.70) | ($74) | |||
[1] | To the extent we hold both derivative assets and liabilities with the same counterparty that are subject to an enforceable master netting arrangement, we expect that we will report them on a gross basis on our balance sheets, consistent with our historical presentation. | |||||
[2] | The amounts represent the value held at year end for open positions and the maximum amount held during the year for closed positions. |
Investments_Additional_Informa
Investments - Additional Information (Detail) (USD $) | 12 Months Ended | ||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2007 | ||||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Open reverse repurchase commitments | $200,000,000 | $581,000,000 | ' | ' | |||
Principal amount of bonds and certificates of deposit on deposit to meet state insurance regulatory and/or rating agency requirements | 153,200,000 | ' | ' | ' | |||
Gross Unrealized Losses | 126,000,000 | 34,000,000 | ' | ' | |||
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 423 | 196 | ' | ' | |||
Trading securities | 0 | 0 | ' | ' | |||
Net realized gains (losses) on securities | 324,500,000 | 314,800,000 | 108,100,000 | ' | |||
Balance Sheet - Fair Value | 68,100,000 | [1] | -95,500,000 | [1] | ' | ' | |
Reclassification out of Accumulated Other Comprehensive Income | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Cash flow hedge gain recognized as an adjustment to interest expense | 2,100,000 | 2,100,000 | 2,600,000 | ' | |||
3.75% Senior Notes due 2021 | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Hedge gain (loss) included in accumulated other comprehensive income | ' | ' | -5,100,000 | ' | |||
Senior notes, issuance amount | 500,000,000 | 500,000,000 | 500,000,000 | ' | |||
6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Repurchase of debt, face amount | 54,100,000 | 30,900,000 | 15,000,000 | ' | |||
Cash flow hedge gain reclassification from accumulated other comprehensive income to net realized gains/losses on securities | 800,000 | 600,000 | 300,000 | ' | |||
Hedge gain (loss) included in accumulated other comprehensive income | ' | ' | ' | 34,400,000 | |||
Debt instrument fixed interest rate terms | ' | ' | ' | '10 years | |||
Senior notes, issuance amount | 1,000,000,000 | 1,000,000,000 | ' | ' | |||
6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | Net unrealized gains on forecasted transactions | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Cash flow hedge gain reclassification from accumulated other comprehensive income to net realized gains/losses on securities | 800,000 | 600,000 | 300,000 | ' | |||
Foreign Government Debt | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Treasury bills issued by the Australian government | 6,300,000 | 21,900,000 | ' | ' | |||
Corporate Credit Default Swaps | Financial Services Sector | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Derivative maturity, term | ' | '5 years | ' | ' | |||
Number of derivative positions closed during the period | ' | 1 | ' | ' | |||
Cash collateral received from counterparty | ' | ' | 700,000 | ' | |||
Number of derivative positions held during the period | 0 | ' | ' | ' | |||
Corporate Credit Default Swaps | Automotive Sector | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Derivative maturity, term | ' | ' | '5 years | ' | |||
Notional Value | ' | ' | 10,000,000 | ' | |||
Number of derivative positions closed during the period | ' | ' | 1 | ' | |||
Number of derivative positions held during the period | 0 | 0 | ' | ' | |||
Interest Rate Swaps | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Balance Sheet - Fair Value | 68,100,000 | ' | ' | ' | |||
Number of derivative positions closed during the period | 3 | ' | ' | ' | |||
Cash collateral delivered to the counterparties | ' | 105,000,000 | 81,700,000 | ' | |||
Cash collateral received from counterparty | 62,700,000 | ' | ' | ' | |||
Interest Rate Swaps | Opened in 2013 | Ten Year Time Horizon | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Number of derivative positions opened during the period | 3 | ' | ' | ' | |||
Derivative maturity, term | '10 years | ' | ' | ' | |||
Interest Rate Swaps | Opened in 2009 | Closed Positions | Nine Year Time Horizon | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Derivative maturity, term | '9 years | ' | ' | ' | |||
Interest Rate Swaps | Opened in 2011 | Closed Positions | Five Year Time Horizon | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Derivative maturity, term | '5 years | ' | ' | ' | |||
Number of derivative positions closed during the period | 2 | ' | ' | ' | |||
Categories of Investments, Marketable Securities, Trading Securities | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Net realized gains (losses) on securities | 0 | 0 | 0 | ' | |||
Fixed Income Securities | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Gross Unrealized Losses | 123,600,000 | ' | ' | ' | |||
Equity securities | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Gross Unrealized Losses | 6,900,000 | 10,300,000 | ' | ' | |||
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 31 | 97 | ' | ' | |||
Equity securities | Common equities | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Gross Unrealized Losses | 2,400,000 | 10,300,000 | ' | ' | |||
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 24 | 97 | ' | ' | |||
Equity securities | Nonredeemable preferred stocks | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Gross Unrealized Losses | 4,500,000 | 0 | ' | ' | |||
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 7 | 0 | ' | ' | |||
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Percentage Decline | 3.00% | ' | ' | ' | |||
Equity securities | Russell One Thousand | Common equities | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Percentage of common stock portfolio | 89.00% | ' | ' | ' | |||
Equity securities | Managed Equity Strategy | Common equities | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Percentage of common stock portfolio | 11.00% | ' | ' | ' | |||
Fixed maturities | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Gross Unrealized Losses | 119,100,000 | 23,700,000 | ' | ' | |||
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 392 | 99 | ' | ' | |||
Fixed maturities | Corporate debt securities | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Percentage which the issuer receives the security back at once the change of control is triggered | 1.00% | ' | ' | ' | |||
Realized investment losses | 11,100,000 | ' | ' | ' | |||
Gross Unrealized Losses | 20,400,000 | 1,000,000 | ' | ' | |||
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 51 | 8 | ' | ' | |||
Non-Income Producing Investments | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Fair value of fixed-maturity securities that were non-income producing during the preceding 12 months | 0 | ' | ' | ' | |||
Value Of Securities Of Any One Issuer Excluding US Government Obligations Exceeding 10 % Of Total Shareholders Equity | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Aggregate cost or fair value of securities | 0 | 0 | ' | ' | |||
Interest Rate Swaps | Non-hedging Instruments | Closed Positions | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Notional Value | 1,263,000,000 | [2] | 0 | [2] | 350,000,000 | [2] | ' |
Balance Sheet - Fair Value | 0 | [1] | 0 | [1] | ' | ' | |
Interest Rate Swaps | Non-hedging Instruments | Fixed maturities | Assets | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Notional Value | 750,000,000 | [2] | 0 | [2] | 0 | [2] | ' |
Balance Sheet - Fair Value | 68,100,000 | [1] | 0 | [1] | ' | ' | |
Interest Rate Swaps | Non-hedging Instruments | Other Liabilities | Liabilities | ' | ' | ' | ' | |||
Schedule of Investments [Line Items] | ' | ' | ' | ' | |||
Notional Value | 0 | [2] | 1,263,000,000 | [2] | 1,263,000,000 | [2] | ' |
Balance Sheet - Fair Value | $0 | [1] | ($95,500,000) | [1] | ' | ' | |
[1] | To the extent we hold both derivative assets and liabilities with the same counterparty that are subject to an enforceable master netting arrangement, we expect that we will report them on a gross basis on our balance sheets, consistent with our historical presentation. | ||||||
[2] | The amounts represent the value held at year end for open positions and the maximum amount held during the year for closed positions. |
Fair_Value_Composition_of_Inve
Fair Value Composition of Investment Portfolio by Major Security Type (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Millions, unless otherwise specified | ||||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | $18,054.70 | [1],[2] | $16,475.50 | [1],[2] |
Debt | 2,073.70 | 2,394.40 | ||
Fixed maturities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 13,540.40 | 11,774.10 | ||
Fixed maturities | Redeemable preferred stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 313.9 | 374.7 | ||
Fixed maturities | Redeemable preferred stocks | Financials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 102.8 | 129.7 | ||
Fixed maturities | Redeemable preferred stocks | Utilities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 65.6 | 66.7 | ||
Fixed maturities | Redeemable preferred stocks | Industrials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 145.5 | 178.3 | ||
Fixed maturities | Debt Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 8,860.40 | 7,973.90 | ||
Fixed maturities | Debt Securities | U.S. government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 3,662.20 | 2,896.50 | ||
Fixed maturities | Debt Securities | State and local government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,256 | 1,964.40 | ||
Fixed maturities | Debt Securities | Foreign government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 15.6 | 0 | ||
Fixed maturities | Debt Securities | Corporate debt securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,926.60 | 3,113 | ||
Fixed maturities | Asset-backed Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 4,366.10 | 3,425.50 | ||
Fixed maturities | Asset-backed Securities | Residential mortgage-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 1,127.90 | 428.2 | ||
Fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,160.50 | 2,048.70 | ||
Fixed maturities | Asset-backed Securities | Other asset-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 1,077.70 | 948.6 | ||
Equity securities | Nonredeemable preferred stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 711.2 | 812.4 | ||
Equity securities | Nonredeemable preferred stocks | Financials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 694.4 | 786 | ||
Equity securities | Nonredeemable preferred stocks | Utilities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 16.8 | 26.4 | ||
Equity securities | Common equities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,530.50 | 1,899 | ||
Equity securities | Common equities | Common Stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,530 | 1,887 | ||
Equity securities | Common equities | Other risk investments | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0.5 | 12 | ||
Total Fixed Maturities and Equity Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 16,782.10 | 14,485.50 | ||
Short-term investments | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 1,272.60 | 1,990 | ||
Fair Value, Inputs, Level 1 | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 7,436.40 | 6,723 | ||
Debt | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 3,677.80 | 2,896.50 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Redeemable preferred stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Redeemable preferred stocks | Financials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Redeemable preferred stocks | Utilities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Redeemable preferred stocks | Industrials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Debt Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 3,677.80 | 2,896.50 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Debt Securities | U.S. government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 3,662.20 | 2,896.50 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Debt Securities | State and local government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Debt Securities | Foreign government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 15.6 | 0 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Debt Securities | Corporate debt securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Asset-backed Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Asset-backed Securities | Residential mortgage-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Fixed maturities | Asset-backed Securities | Other asset-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Equity securities | Nonredeemable preferred stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 240.8 | 259.6 | ||
Fair Value, Inputs, Level 1 | Equity securities | Nonredeemable preferred stocks | Financials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 240.8 | 259.6 | ||
Fair Value, Inputs, Level 1 | Equity securities | Nonredeemable preferred stocks | Utilities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Equity securities | Common equities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,530 | 1,887 | ||
Fair Value, Inputs, Level 1 | Equity securities | Common equities | Common Stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,530 | 1,887 | ||
Fair Value, Inputs, Level 1 | Equity securities | Common equities | Other risk investments | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 1 | Total Fixed Maturities and Equity Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 6,448.60 | 5,043.10 | ||
Fair Value, Inputs, Level 1 | Short-term investments | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 987.8 | 1,679.90 | ||
Fair Value, Inputs, Level 2 | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 10,549.60 | 9,637.80 | ||
Debt | 2,073.70 | 2,394.40 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 9,833.40 | 8,806.80 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Redeemable preferred stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 313.9 | 374.7 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Redeemable preferred stocks | Financials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 102.8 | 129.7 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Redeemable preferred stocks | Utilities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 65.6 | 66.7 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Redeemable preferred stocks | Industrials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 145.5 | 178.3 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Debt Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 5,182.60 | 5,077.40 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Debt Securities | U.S. government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Debt Securities | State and local government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,256 | 1,964.40 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Debt Securities | Foreign government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Debt Securities | Corporate debt securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,926.60 | 3,113 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Asset-backed Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 4,336.90 | 3,354.70 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Asset-backed Securities | Residential mortgage-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 1,127.70 | 382.7 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,131.50 | 2,023.40 | ||
Fair Value, Inputs, Level 2 | Fixed maturities | Asset-backed Securities | Other asset-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 1,077.70 | 948.6 | ||
Fair Value, Inputs, Level 2 | Equity securities | Nonredeemable preferred stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 431.4 | 520.9 | ||
Fair Value, Inputs, Level 2 | Equity securities | Nonredeemable preferred stocks | Financials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 414.6 | 494.5 | ||
Fair Value, Inputs, Level 2 | Equity securities | Nonredeemable preferred stocks | Utilities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 16.8 | 26.4 | ||
Fair Value, Inputs, Level 2 | Equity securities | Common equities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 2 | Equity securities | Common equities | Common Stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 2 | Equity securities | Common equities | Other risk investments | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 2 | Total Fixed Maturities and Equity Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 10,264.80 | 9,327.70 | ||
Fair Value, Inputs, Level 2 | Short-term investments | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 284.8 | 310.1 | ||
Fair Value, Inputs, Level 3 | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 68.7 | 114.7 | ||
Debt | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 29.2 | 70.8 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Redeemable preferred stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Redeemable preferred stocks | Financials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Redeemable preferred stocks | Utilities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Redeemable preferred stocks | Industrials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Debt Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Debt Securities | U.S. government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Debt Securities | State and local government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Debt Securities | Foreign government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Debt Securities | Corporate debt securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Asset-backed Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 29.2 | 70.8 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Asset-backed Securities | Residential mortgage-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0.2 | 45.5 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 29 | 25.3 | ||
Fair Value, Inputs, Level 3 | Fixed maturities | Asset-backed Securities | Other asset-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Equity securities | Nonredeemable preferred stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 39 | 31.9 | ||
Fair Value, Inputs, Level 3 | Equity securities | Nonredeemable preferred stocks | Financials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 39 | 31.9 | ||
Fair Value, Inputs, Level 3 | Equity securities | Nonredeemable preferred stocks | Utilities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Equity securities | Common equities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0.5 | 12 | ||
Fair Value, Inputs, Level 3 | Equity securities | Common equities | Common Stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Fair Value, Inputs, Level 3 | Equity securities | Common equities | Other risk investments | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0.5 | 12 | ||
Fair Value, Inputs, Level 3 | Total Fixed Maturities and Equity Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 68.7 | 114.7 | ||
Fair Value, Inputs, Level 3 | Short-term investments | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0 | 0 | ||
Carrying (Reported) Amount, Fair Value Disclosure | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 16,584.70 | 15,138.20 | ||
Debt | 1,860.90 | 2,063.10 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 13,415.30 | 11,373.90 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Redeemable preferred stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 299.5 | 356.9 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Redeemable preferred stocks | Financials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 84.2 | 110.7 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Redeemable preferred stocks | Utilities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 64.9 | 64.9 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Redeemable preferred stocks | Industrials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 150.4 | 181.3 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Debt Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 8,778.30 | 7,703.70 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Debt Securities | U.S. government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 3,630.40 | 2,806.40 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Debt Securities | State and local government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,247.30 | 1,914.40 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Debt Securities | Foreign government obligations | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 15.6 | 0 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Debt Securities | Corporate debt securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,885 | 2,982.90 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Asset-backed Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 4,337.50 | 3,313.30 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Asset-backed Securities | Residential mortgage-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 1,110.10 | 413.4 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 2,154.40 | 1,963.90 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Fixed maturities | Asset-backed Securities | Other asset-backed securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 1,073 | 936 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Equity securities | Nonredeemable preferred stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 445.7 | 404 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Equity securities | Nonredeemable preferred stocks | Financials | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 431.5 | 383.3 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Equity securities | Nonredeemable preferred stocks | Utilities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 14.2 | 20.7 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Equity securities | Common equities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 1,451.10 | 1,370.30 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Equity securities | Common equities | Common Stocks | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 1,450.60 | 1,367.20 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Equity securities | Common equities | Other risk investments | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 0.5 | 3.1 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Total Fixed Maturities and Equity Securities | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | 15,312.10 | 13,148.20 | ||
Carrying (Reported) Amount, Fair Value Disclosure | Short-term investments | ' | ' | ||
Fair Value Measurements [Line Items] | ' | ' | ||
Portfolio | $1,272.60 | $1,990 | ||
[1] | The total fair value of the portfolio included $1.8 billion and $1.4 billion at December 31, 2013 and 2012, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of any unsettled security transactions. | |||
[2] | Reflected in our total portfolio are unsettled security transactions and collateral on open derivative positions, which collectively reflect a liability of $61.3 million at December 31, 2013, compared to an asset of $90.9 million at December 31, 2012. |
Fair_Value_Summary_of_Changes_
Fair Value Summary of Changes in Fair Value Associated With Level 3 Assets (Detail) (USD $) | 12 Months Ended | |||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ||
Beginning Fair Value | $114.70 | $97.70 | ||
Calls/ Maturities/ Paydowns | -32.5 | -23.8 | ||
Purchases | 125.4 | 28.5 | ||
Sales | -2.4 | 0 | ||
Net Realized (Gain)/Loss on Sales | -36 | 0 | ||
Change in Valuation | 40.9 | 12.3 | ||
Net Transfers In (Out) | -141.4 | [1] | 0 | |
Ending Fair value | 68.7 | 114.7 | ||
Fixed maturities | ' | ' | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ||
Beginning Fair Value | 70.8 | 86.2 | ||
Calls/ Maturities/ Paydowns | -32 | -23.6 | ||
Purchases | 125.1 | 0 | ||
Sales | 0 | 0 | ||
Net Realized (Gain)/Loss on Sales | 0 | 0 | ||
Change in Valuation | 6.7 | 8.2 | ||
Net Transfers In (Out) | -141.4 | [1] | 0 | |
Ending Fair value | 29.2 | 70.8 | ||
Fixed maturities | Asset-backed Securities | Residential mortgage-backed securities | ' | ' | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ||
Beginning Fair Value | 45.5 | 62.3 | ||
Calls/ Maturities/ Paydowns | -28.6 | -17.3 | ||
Purchases | 125.1 | 0 | ||
Sales | 0 | 0 | ||
Net Realized (Gain)/Loss on Sales | 0 | 0 | ||
Change in Valuation | -0.4 | 0.5 | ||
Net Transfers In (Out) | -141.4 | [1] | 0 | |
Ending Fair value | 0.2 | 45.5 | ||
Fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities | ' | ' | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ||
Beginning Fair Value | 25.3 | 21.3 | ||
Calls/ Maturities/ Paydowns | -3.4 | -3.7 | ||
Purchases | 0 | 0 | ||
Sales | 0 | 0 | ||
Net Realized (Gain)/Loss on Sales | 0 | 0 | ||
Change in Valuation | 7.1 | 7.7 | ||
Net Transfers In (Out) | 0 | [1] | 0 | |
Ending Fair value | 29 | 25.3 | ||
Fixed maturities | Asset-backed Securities | Other asset-backed securities | ' | ' | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ||
Beginning Fair Value | 0 | 2.6 | ||
Calls/ Maturities/ Paydowns | 0 | -2.6 | ||
Purchases | 0 | 0 | ||
Sales | 0 | 0 | ||
Net Realized (Gain)/Loss on Sales | 0 | 0 | ||
Change in Valuation | 0 | 0 | ||
Net Transfers In (Out) | 0 | [1] | 0 | |
Ending Fair value | 0 | 0 | ||
Equity securities | Nonredeemable preferred stocks | Financials | ' | ' | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ||
Beginning Fair Value | 31.9 | [2],[3] | 0 | [2] |
Calls/ Maturities/ Paydowns | 0 | [3] | 0 | [2] |
Purchases | 0 | [3] | 28.5 | [2] |
Sales | 0 | [3] | 0 | [2] |
Net Realized (Gain)/Loss on Sales | 0 | [3] | 0 | [2] |
Change in Valuation | 7.1 | [3] | 3.4 | [2] |
Net Transfers In (Out) | 0 | [1],[3] | 0 | [2] |
Ending Fair value | 39 | [3] | 31.9 | [2],[3] |
Equity securities | Common equities | Other risk investments | ' | ' | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ||
Beginning Fair Value | 12 | 11.5 | ||
Calls/ Maturities/ Paydowns | -0.5 | -0.2 | ||
Purchases | 0.3 | 0 | ||
Sales | -2.4 | 0 | ||
Net Realized (Gain)/Loss on Sales | -36 | 0 | ||
Change in Valuation | 27.1 | 0.7 | ||
Net Transfers In (Out) | 0 | [1] | 0 | |
Ending Fair value | $0.50 | $12 | ||
[1] | The $141.4 million was transferred out of Level 3 and into Level 2 due to an increase in liquidity and trading volume in the market. | |||
[2] | The $3.4 million represents net holding period gains on a hybrid security which is reflected in net realized gains (losses) on securities in the comprehensive income statement. | |||
[3] | The $7.1 million represents net holding period gains on a hybrid security which is reflected in net realized gains (losses) on securities in the comprehensive income statement. |
Fair_Value_Summary_of_Changes_1
Fair Value Summary of Changes in Fair Value Associated With Level 3 Assets (Parenthetical) (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ' |
Net realized gains (losses) on securities | $324,500,000 | $314,800,000 | $108,100,000 |
Equity securities | Nonredeemable preferred stocks | Hybrid Securities | Financials | ' | ' | ' |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ' |
Net realized gains (losses) on securities | 7,100,000 | 3,400,000 | ' |
Asset-backed Securities | Fixed maturities | Residential mortgage-backed securities | ' | ' | ' |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ' |
Transferred out of Level 3 into Level 2 | ($141,400,000) | ' | ' |
Fair_Value_Summary_of_Quantita
Fair Value Summary of Quantitative Information about Level 3 Fair Value Measurements (Detail) (USD $) | 12 Months Ended | |||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | ||
Investment | Investment | |||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Fair Value | $18,054.70 | [1],[2] | $16,475.50 | [1],[2] |
Fair Value, Inputs, Level 3 | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Fair Value | 68.7 | 114.7 | ||
External Pricing | Fair Value, Inputs, Level 3 | Fixed maturities | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Fair Value | 29.2 | 25.5 | ||
External Pricing | Fair Value, Inputs, Level 3 | Fixed maturities | Asset-backed Securities | Residential mortgage-backed securities | Prepayment Rate Sixteen Percent | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Number of securities | ' | 1 | ||
Fair Value | ' | 0.2 | ||
Valuation Technique | ' | 'External vendor | ||
Unobservable Input, prepayment rate | ' | 16.00% | ||
External Pricing | Fair Value, Inputs, Level 3 | Fixed maturities | Asset-backed Securities | Residential mortgage-backed securities | Prepayment rate zero percent | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Number of securities | 1 | ' | ||
Fair Value | 0.2 | ' | ||
Valuation Technique | 'External vendor | ' | ||
Unobservable Input, prepayment rate | 0.00% | ' | ||
External Pricing | Fair Value, Inputs, Level 3 | Fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities | Prepayment rate zero percent | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Number of securities | 2 | 3 | ||
Fair Value | 29 | 25.3 | ||
Valuation Technique | 'External vendor | 'External vendor | ||
Unobservable Input, prepayment rate | 0.00% | 0.00% | ||
Internal Pricing | Fair Value, Inputs, Level 3 | Fixed maturities | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Number of securities | 0 | 0 | ||
Internal Pricing | Fair Value, Inputs, Level 3 | Equity securities | Nonredeemable preferred stocks | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Number of securities | 1 | 1 | ||
Fair Value | 39 | 31.9 | ||
Internal Pricing | Fair Value, Inputs, Level 3 | Equity securities | Nonredeemable preferred stocks | Financials | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Fair Value | 39 | 31.9 | ||
Valuation Technique | 'Multiple of tangible net book value | 'Multiple of tangible net book value | ||
Unobservable Input, price to book ratio multiple | 1.9 | 1.9 | ||
Internal Pricing | Fair Value, Inputs, Level 3 | Equity securities | Common equities | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Number of securities | 0 | 1 | ||
Fair Value | ' | 11.2 | ||
Internal Pricing | Fair Value, Inputs, Level 3 | Equity securities | Common equities | Other risk investments | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Fair Value | 0 | 11.2 | ||
Valuation Technique | ' | 'Discounted consolidated equity | ||
Unobservable Input, discount for lack of marketability | ' | 20.00% | ||
Subtotal Level 3 Securities | Fair Value, Inputs, Level 3 | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Fair Value | 68.2 | 68.6 | ||
Third Party Pricing Exemption Securities | Fair Value, Inputs, Level 3 | ' | ' | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' | ||
Fair Value | $0.50 | [3] | $46.10 | [4] |
[1] | The total fair value of the portfolio included $1.8 billion and $1.4 billion at December 31, 2013 and 2012, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of any unsettled security transactions. | |||
[2] | Reflected in our total portfolio are unsettled security transactions and collateral on open derivative positions, which collectively reflect a liability of $61.3 million at December 31, 2013, compared to an asset of $90.9 million at December 31, 2012. | |||
[3] | The fair values for these securities were obtained from non-binding external sources where unobservable inputs are not reasonably available to us. | |||
[4] | The $7.1 million represents net holding period gains on a hybrid security which is reflected in net realized gains (losses) on securities in the comprehensive income statement. |
Fair_Value_Additional_Informat
Fair Value - Additional Information (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Millions, unless otherwise specified | Fair Value, Inputs, Level 1 | Fair Value, Inputs, Level 1 | Fair Value, Inputs, Level 1 | Fair Value, Inputs, Level 1 | Fair Value, Inputs, Level 2 | Fair Value, Inputs, Level 2 | Fair Value, Inputs, Level 2 | Fair Value, Inputs, Level 2 | Fair Value, Inputs, Level 2 | Fair Value, Inputs, Level 2 | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 3 | Investment Portfolio | Redeemable preferred stocks | Nonredeemable preferred stocks | Nonredeemable preferred stocks | Common equities | Common equities | ||||
Vendor Quoted Pricing | Vendor Quoted Pricing | Vendor Quoted Pricing | Vendor Quoted Pricing | Dealer Quoted Pricing | Dealer Quoted Pricing | Fixed maturities | Fixed maturities | Investment | Fixed maturities | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 3 | |||||||||||
Internal Pricing | Internal Pricing | Investment | Equity securities | Equity securities | Equity securities | Equity securities | ||||||||||||||||||
Internal Pricing | Internal Pricing | Internal Pricing | Internal Pricing | |||||||||||||||||||||
Investment | Investment | Investment | ||||||||||||||||||||||
Fair Value Measurements [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Number of security transferred out of Level 1 into Level 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 1 | ' | ' | ' | ' | ||
Transferred out of Level 1 into Level 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $25 | ' | ' | ' | ' | ||
Quoted prices percentage of fair value assets | 100.00% | [1],[2] | 100.00% | [1],[2] | ' | ' | 56.00% | 57.00% | ' | ' | 98.00% | 98.00% | 2.00% | 2.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of securities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | ' | ' | 1 | 1 | 0 | 1 | ||
Portfolio | $18,054.70 | [1],[2] | $16,475.50 | [1],[2] | $7,436.40 | $6,723 | ' | ' | $10,549.60 | $9,637.80 | ' | ' | ' | ' | $68.70 | $114.70 | ' | ' | ' | ' | $39 | $31.90 | ' | $11.20 |
[1] | The total fair value of the portfolio included $1.8 billion and $1.4 billion at December 31, 2013 and 2012, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of any unsettled security transactions. | |||||||||||||||||||||||
[2] | Reflected in our total portfolio are unsettled security transactions and collateral on open derivative positions, which collectively reflect a liability of $61.3 million at December 31, 2013, compared to an asset of $90.9 million at December 31, 2012. |
Debt_Detail
Debt (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Millions, unless otherwise specified | ||||
Debt Instrument [Line Items] | ' | ' | ||
Carrying Value | $1,860.90 | [1] | $2,063.10 | [1] |
Fair Value | 2,073.70 | 2,394.40 | ||
7% Notes due 2013 | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying Value | 0 | 149.9 | ||
Fair Value | 0 | 157.1 | ||
3.75% Senior Notes due 2021 | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying Value | 497.6 | 497.3 | ||
Fair Value | 509.1 | 549.1 | ||
6 5/8% Senior Notes due 2029 | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying Value | 295.3 | 295.2 | ||
Fair Value | 359.6 | 385 | ||
6.25% Senior Notes due 2032 | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying Value | 394.6 | 394.5 | ||
Fair Value | 473.7 | 513.5 | ||
6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying Value | 673.4 | 726.2 | ||
Fair Value | $731.30 | $789.70 | ||
[1] | Consists of both short- and long-term debt. See Note 4 – Debt for further discussion. |
Debt_Parenthetical_Detail
Debt (Parenthetical) (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Debt Instrument [Line Items] | ' | ' | ' |
Debt instrument, outstanding | $1,877,100,000 | ' | ' |
7% Notes due 2013 | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Debt instrument, face amount | 150,000,000 | 150,000,000 | ' |
Debt Instrument, Interest Rate, Stated Percentage | 7.00% | ' | ' |
3.75% Senior Notes due 2021 | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Debt instrument, face amount | 500,000,000 | 500,000,000 | 500,000,000 |
Debt Instrument, Interest Rate, Stated Percentage | 3.75% | ' | ' |
6 5/8% Senior Notes due 2029 | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Debt instrument, face amount | 300,000,000 | 300,000,000 | ' |
Debt Instrument, Interest Rate, Stated Percentage | 6.63% | ' | ' |
6.25% Senior Notes due 2032 | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Debt instrument, face amount | 400,000,000 | 400,000,000 | ' |
Debt Instrument, Interest Rate, Stated Percentage | 6.25% | ' | ' |
6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Debt instrument, face amount | 1,000,000,000 | 1,000,000,000 | ' |
Debt instrument, outstanding | $677,100,000 | $731,200,000 | ' |
Debt Instrument, Interest Rate, Stated Percentage | 6.70% | ' | ' |
Debt_Unrealized_Gains_Losses_F
Debt Unrealized Gains (Losses) From Debt Hedges Included In Accumulated Other (Detail) (USD $) | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | ||||
In Millions, unless otherwise specified | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 1999 | Dec. 31, 2013 | Dec. 31, 2002 | Dec. 31, 2013 | Dec. 31, 2007 | Dec. 31, 2013 |
3.75% Senior Notes due 2021 | 3.75% Senior Notes due 2021 | 6 5/8% Senior Notes due 2029 | 6 5/8% Senior Notes due 2029 | 6.25% Senior Notes due 2032 | 6.25% Senior Notes due 2032 | 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Unrealized Gain (Loss) | ($5.10) | ' | ($4.20) | ' | $5.10 | ' | $34.40 | ' |
Unamortized Balance | ' | ($4.10) | ' | ($3.30) | ' | $4.10 | ' | $9.70 |
Debt_Aggregate_Principal_Payme
Debt Aggregate Principal Payments On Debt Outstanding (Detail) (USD $) | Dec. 31, 2013 |
In Millions, unless otherwise specified | |
Debt Outstanding [Line Items] | ' |
2014 | $0 |
2015 | 0 |
2016 | 0 |
2017 | 0 |
2018 | 0 |
Thereafter | 1,877.10 |
Total | $1,877.10 |
Debt_Additional_Information_De
Debt - Additional Information (Detail) (USD $) | 12 Months Ended | 1 Months Ended | |||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jan. 31, 2012 | Oct. 31, 2013 | |
Discretionary Line of Credit | Line of Credit | 364-Day Secured Liquidity Credit Facility Agreement | 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | 6.375% Senior Notes due 2012 | 7% Notes due 2013 | ||||
Federal Funds Rate | Three Month LIBOR | Net unrealized gains on forecasted transactions | Net unrealized gains on forecasted transactions | Net unrealized gains on forecasted transactions | |||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt interest payments | 'Interest on all debt is payable semiannually at the stated rates. However, the 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 (the “6.70% Debenturesâ€) will only bear interest at this fixed annual rate through, but excluding, June 15, 2017. Thereafter, the 6.70% Debentures will bear interest at an annual rate equal to the three-month LIBOR plus 2.0175%, and the interest will be payable quarterly until the 6.70% Debentures are redeemed or retired | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest payment frequency | 'Payable semiannually | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basis points | ' | ' | ' | ' | 0.50% | ' | ' | ' | ' | 2.02% | ' | ' | ' | ' | ' |
Fixed interest rate term | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' |
Payment of debt | $150,000,000 | $350,000,000 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $350,000,000 | $150,000,000 |
Repurchase of debt, face amount | ' | ' | ' | ' | ' | ' | 54,100,000 | 30,900,000 | 15,000,000 | ' | ' | ' | ' | ' | ' |
(Gains) losses on extinguishment of debt | -4,300,000 | -1,800,000 | -100,000 | ' | ' | ' | -4,300,000 | -1,800,000 | ' | ' | ' | ' | ' | ' | ' |
Cash flow hedge gain reclassification from accumulated other comprehensive income to net realized gains/losses on securities | ' | ' | ' | ' | ' | ' | 800,000 | 600,000 | 300,000 | ' | 800,000 | 600,000 | 300,000 | ' | ' |
Line of Credit Facility, Maximum Borrowing Capacity | ' | ' | ' | 100,000,000 | ' | 125,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Interest Rate Description | ' | ' | ' | ' advances under the Line of Credit (if any) will bear interest at a variable rate equal to the higher of PNC's Prime Rate and the sum of the Federal Funds Open Rate plus 50 basis points. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Amount Outstanding | ' | ' | ' | 0 | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Consideration paid for revolving agreement | ' | ' | ' | ' | ' | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income_Taxes_Components_of_Inc
Income Taxes Components of Income Tax Provision (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Current tax provision | $460.20 | $424.80 | $440.20 |
Deferred tax expense (benefit) | 94.4 | -9.4 | 31.3 |
Total income tax provision | $554.60 | $415.40 | $471.50 |
Income_Taxes_Reconciliation_of
Income Taxes Reconciliation of Provision (Benefit) for income Taxes Reported in Consolidated Statements Of Income with Tax at Statutory Rate (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Income before income taxes | $1,720 | $1,317.70 | $1,487 |
Tax at statutory rate | 602 | 461.2 | 520.5 |
Dividends received deduction | -17.6 | -18.2 | -18.2 |
Exempt interest income | -13.1 | -14.7 | -17.5 |
Tax-deductible dividends | -13.6 | -11.9 | -3.8 |
Tax credits | -2.3 | 0 | -9.1 |
Other items, net | -0.8 | -1 | -0.4 |
Total income tax provision | $554.60 | $415.40 | $471.50 |
Tax at statutory rate | 35.00% | 35.00% | 35.00% |
Dividends received deduction | -1.00% | -1.00% | -1.00% |
Exempt interest income | -1.00% | -1.00% | -1.00% |
Tax-deductible dividends | -1.00% | -1.00% | 0.00% |
Tax credits | 0.00% | 0.00% | -1.00% |
Other items, net | 0.00% | 0.00% | 0.00% |
Total income tax provision | 32.00% | 32.00% | 32.00% |
Income_Taxes_Components_of_Net
Income Taxes Components of Net Deferred Tax Assets (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Deferred tax assets: | ' | ' |
Unearned premiums reserve | $361 | $344.30 |
Investment basis differences | 94.8 | 208.3 |
Non-deductible accruals | 200.7 | 191.6 |
Loss and loss adjustment expense reserves | 92 | 107.3 |
Other | 14.7 | 3.9 |
Deferred tax liabilities: | ' | ' |
Net unrealized gains on securities | -509.9 | -464.5 |
Hedges on forecasted transactions | -2.2 | -3.3 |
Deferred acquisition costs | -156.7 | -152.1 |
Property and equipment | -99.6 | -103.6 |
Prepaid expenses | -14.4 | -12.2 |
Deferred gain on extinguishment of debt | -4.8 | -5.8 |
Other | -4 | -4.5 |
Net deferred tax liability | 28.4 | 0 |
Net deferred tax asset | $0 | $109.40 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Taxes [Line Items] | ' | ' | ' |
Net taxes recoverable | $17.10 | ' | ' |
Net taxes payable | ' | 17.9 | ' |
Provision for income taxes | 554.6 | 415.4 | 471.5 |
Interest Expense or Benefit | ' | ' | ' |
Income Taxes [Line Items] | ' | ' | ' |
Provision for income taxes | $0.20 | $0 | $0 |
Loss_And_Loss_Adjustment_Expen2
Loss And Loss Adjustment Expense Reserves Activity in Loss and loss Adjustment Expense Reserves (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ' | ' | ' |
Balance at beginning of period | $7,838.40 | $7,245.80 | $7,071 |
Less reinsurance recoverables on unpaid losses | 862.1 | 785.7 | 704.1 |
Net balance at beginning of period | 6,976.30 | 6,460.10 | 6,366.90 |
Incurred related to: | ' | ' | ' |
Current year | 12,427.30 | 11,926 | 10,876.80 |
Prior years | 45.1 | 22 | -242 |
Total incurred | 12,472.40 | 11,948 | 10,634.80 |
Paid related to: | ' | ' | ' |
Current year | 8,095 | 7,895.30 | 7,289.30 |
Prior years | 3,919.90 | 3,536.50 | 3,252.30 |
Total paid | 12,014.90 | 11,431.80 | 10,541.60 |
Net balance at ending of period | 7,433.80 | 6,976.30 | 6,460.10 |
Plus reinsurance recoverables on unpaid losses | 1,045.90 | 862.1 | 785.7 |
Balance at ending of period | $8,479.70 | $7,838.40 | $7,245.80 |
Loss_And_Loss_Adjustment_Expen3
Loss And Loss Adjustment Expense Reserves Loss And Loss Adjustment Expense Reserves - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Insurance Reserves [Line Items] | ' | ' | ' |
Prior years reserve development | $45.10 | $22 | ($242) |
Accident Year 2011 | ' | ' | ' |
Insurance Reserves [Line Items] | ' | ' | ' |
Unfavorable development in loss and loss adjustment expense reserves | 80.00% | ' | ' |
Accident Year 2012 | ' | ' | ' |
Insurance Reserves [Line Items] | ' | ' | ' |
Unfavorable development in loss and loss adjustment expense reserves | 20.00% | ' | ' |
Commercial Lines | ' | ' | ' |
Insurance Reserves [Line Items] | ' | ' | ' |
Unfavorable development in loss and loss adjustment expense reserves | 55.00% | ' | ' |
Personal Lines | ' | ' | ' |
Insurance Reserves [Line Items] | ' | ' | ' |
Favorable development in loss and loss adjustment expense reserves | ' | ' | 70.00% |
Personal Lines | Agency Channel | ' | ' | ' |
Insurance Reserves [Line Items] | ' | ' | ' |
Favorable development in loss and loss adjustment expense reserves | ' | ' | 25.00% |
Personal Lines | Direct Channel | ' | ' | ' |
Insurance Reserves [Line Items] | ' | ' | ' |
Favorable development in loss and loss adjustment expense reserves | ' | ' | 75.00% |
Reinsurance_Effect_of_Reinsura
Reinsurance Effect of Reinsurance on Premiums Written and Earned (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' | ' |
Direct premiums written | $17,562.80 | $16,558.80 | $15,333.10 |
Ceded written | -223.1 | -186.1 | -186.5 |
Net premiums written | 17,339.70 | 16,372.70 | 15,146.60 |
Direct premiums earned | 17,317.90 | 16,207.60 | 15,107.50 |
Ceded earned | -214.5 | -189.6 | -204.7 |
Net premiums earned | $17,103.40 | $16,018 | $14,902.80 |
Reinsurance_Prepaid_Reinsuranc
Reinsurance Prepaid Reinsurance Premiums and Reinsurance Recoverables (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' |
Prepaid reinsurance premiums | $74.90 | $66.30 |
Percentage of Prepaid Reinsurance Premiums | 100.00% | 100.00% |
Reinsurance Recoverables | 1,090.20 | 901 |
Percentage of Reinsurance Recoverables | 100.00% | 100.00% |
State Reinsurance Plan | ' | ' |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' |
Prepaid reinsurance premiums | 71.1 | 60.3 |
Percentage of Prepaid Reinsurance Premiums | 95.00% | 91.00% |
Reinsurance Recoverables | 1,005.30 | 856.1 |
Percentage of Reinsurance Recoverables | 92.00% | 95.00% |
State Reinsurance Plan | Michigan Catastrophic Claims Association | ' | ' |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' |
Prepaid reinsurance premiums | 29.5 | 25.4 |
Percentage of Prepaid Reinsurance Premiums | 40.00% | 38.00% |
Reinsurance Recoverables | 875.9 | 739.2 |
Percentage of Reinsurance Recoverables | 80.00% | 82.00% |
State Reinsurance Plan | Commercial Auto Insurance Procedures Plans | ' | ' |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' |
Prepaid reinsurance premiums | 21.1 | 15.4 |
Percentage of Prepaid Reinsurance Premiums | 28.00% | 23.00% |
Reinsurance Recoverables | 79.3 | 66.3 |
Percentage of Reinsurance Recoverables | 7.00% | 7.00% |
State Reinsurance Plan | North Carolina Reinsurance Facility | ' | ' |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' |
Prepaid reinsurance premiums | 20.5 | 19.5 |
Percentage of Prepaid Reinsurance Premiums | 27.00% | 30.00% |
Reinsurance Recoverables | 50.1 | 50.6 |
Percentage of Reinsurance Recoverables | 5.00% | 6.00% |
Non-State Reinsurance Plans | ' | ' |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' |
Prepaid reinsurance premiums | 3.8 | 6 |
Percentage of Prepaid Reinsurance Premiums | 5.00% | 9.00% |
Reinsurance Recoverables | $84.90 | $44.90 |
Percentage of Reinsurance Recoverables | 8.00% | 5.00% |
Reinsurance_Additional_Informa
Reinsurance - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' | ' |
Reinsurance ceded | $347 | $230.70 | $219.70 |
State Reinsurance Plan | ' | ' | ' |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' | ' |
Percentage of Ceded Premiums | 97.00% | 98.00% | 94.00% |
State Reinsurance Plan | Michigan Catastrophic Claims Association And North Carolina Reinsurance Facility | ' | ' | ' |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ' | ' | ' |
Percentage of Ceded Premiums | 77.00% | 80.00% | 80.00% |
Statutory_Financial_Informatio1
Statutory Financial Information - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Statutory Accounting Practices [Line Items] | ' | ' | ' |
Consolidated statutory policyholders' surplus | $5,991 | $5,605.20 | ' |
Statutory net income | 1,086.30 | 808.3 | 1,001.70 |
Consolidated statutory policyholders' surplus, net admitted assets of insurance subsidiaries and affiliate that are required to meet minimum statutory surplus requirements in such entities' states of domicile | 524.8 | ' | ' |
Aggregate cash dividends paid to the parent company by subsidiaries | 1,119.40 | ' | ' |
Maximum aggregate dividend amount subsidiaries could pay without prior approval from regulatory authorities | $1,169.70 | ' | ' |
Employee_Benefit_Plans_Amounts
Employee Benefit Plans Amounts Charged to Income for employees Incentive Compensation Plans (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Incentive Compensation Cash Award | ' | ' | ' |
Incentive Compensation Plans Expense [Line Items] | ' | ' | ' |
Pretax | $234.50 | $207 | $196.10 |
After Tax | 152.4 | 134.6 | 127.5 |
Stock Compensation Plan | ' | ' | ' |
Incentive Compensation Plans Expense [Line Items] | ' | ' | ' |
Pretax | 64.9 | 63.4 | 50.5 |
After Tax | $42.20 | $41.20 | $32.80 |
Employee_Benefit_Plans_Summary
Employee Benefit Plans Summary of All Employee Restricted Equity Award Activity (Detail) (Employee Restricted Equity Awards, USD $) | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||||
Employee Restricted Equity Awards | ' | ' | ' | |||
Number of Shares | ' | ' | ' | |||
Beginning of year | 11,625,981 | [1],[2],[3] | 12,296,847 | [1],[2],[3] | 11,681,826 | [1] |
Add (deduct): | ' | ' | ' | |||
Granted | 2,738,809 | [1],[4] | 2,680,229 | [1],[4] | 2,483,461 | [1],[4] |
Vested | -4,293,605 | [1] | -3,188,111 | [1] | -1,571,237 | [1] |
Forfeited | -152,610 | [1] | -162,984 | [1] | -297,203 | [1] |
End of year | 9,918,575 | [1],[2],[3] | 11,625,981 | [1],[2],[3] | 12,296,847 | [1],[2],[3] |
Available, end of year | 11,139,779 | [1],[5] | 15,624,677 | [1],[5] | 18,141,922 | [1],[5] |
Weighted Average Grant Date Fair Value | ' | ' | ' | |||
Beginning of year | $17.80 | [2],[3] | $16.86 | [2],[3] | $16.55 | |
Granted | $22.73 | [4] | $19.11 | [4] | $20.03 | [4] |
Vested | $15.54 | $15.23 | $19.88 | |||
Forfeited | $18.28 | $17.93 | $15.41 | |||
End of year | $20.13 | [2],[3] | $17.80 | [2],[3] | $16.86 | [2],[3] |
[1] | Includes both restricted stock units and restricted stock. Upon vesting, all units will be converted on a one-for-one basis into Progressive common shares funded from existing treasury shares. All performance-based awards are included at their target amounts. | |||||
[2] | At December 31, 2013, the total unrecognized compensation cost related to unvested equity awards was $84.6 million, which includes performance-based awards at their currently estimated vesting value. This compensation expense will be recognized into the income statement over the weighted average vesting period of 2.2 years. | |||||
[3] | At December 31, 2013, the number of shares included 2,935,985 performance-based awards at their target amounts. We expect 3,898,809 performance-based awards to vest, based upon our current estimate of the achievement of pre-determined performance goals. | |||||
[4] | In 2010, we began reinvesting dividend equivalents on restricted stock units. For 2013, 2012, and 2011, the number granted includes 161,077, 440,029, and 55,288 units, respectively, at a weighted average grant date fair value of $0, since the dividends were factored into the grant date fair value of the original grant. | |||||
[5] | Represents shares available under the 2010 Incentive Plan; the 2003 Incentive Plan expired on January 31, 2013, and the remaining 1,898,699 shares thereunder are no longer available for future issuance, however, dividend equivalents will be issued on outstanding awards up to the remaining authorization amount. |
Employee_Benefit_Plans_Summary1
Employee Benefit Plans Summary of All Employee Restricted Equity Award Activity (Parenthetical) (Detail) (USD $) | Jan. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | |||
In Millions, except Share data, unless otherwise specified | Employee Restricted Equity Awards | Employee Restricted Equity Awards | Employee Restricted Equity Awards | Employee Restricted Equity Awards | Employee Restricted Equity Awards | Employee Restricted Equity Awards | Employee Restricted Equity Awards | ||||
Dividend Equivalent Units | Dividend Equivalent Units | Dividend Equivalent Units | Performance Based Restricted Equity Awards | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | |||
Number granted units | ' | 2,738,809 | [1],[2] | 2,680,229 | [1],[2] | 2,483,461 | [1],[2] | 161,077 | 440,029 | 55,288 | ' |
Weighted average grant date fair value | ' | $22.73 | [2] | $19.11 | [2] | $20.03 | [2] | $0 | $0 | $0 | ' |
Equity awards target amount | ' | ' | ' | ' | ' | ' | ' | 2,935,985 | |||
Equity awards to vest | ' | ' | ' | ' | ' | ' | ' | 3,898,809 | |||
Unrecognized compensation cost related to unvested equity awards | ' | $84.60 | ' | ' | ' | ' | ' | ' | |||
Period of recognition of compensation expense related to unvested equity awards | ' | '2 years 2 months 19 days | ' | ' | ' | ' | ' | ' | |||
Shares reserved under expired plan | 1,898,699 | ' | ' | ' | ' | ' | ' | ' | |||
[1] | Includes both restricted stock units and restricted stock. Upon vesting, all units will be converted on a one-for-one basis into Progressive common shares funded from existing treasury shares. All performance-based awards are included at their target amounts. | ||||||||||
[2] | In 2010, we began reinvesting dividend equivalents on restricted stock units. For 2013, 2012, and 2011, the number granted includes 161,077, 440,029, and 55,288 units, respectively, at a weighted average grant date fair value of $0, since the dividends were factored into the grant date fair value of the original grant. |
Employee_Benefit_Plans_Summary2
Employee Benefit Plans Summary of all Employee Stock Option Activity (Detail) (Employee Stock Option, USD $) | 12 Months Ended |
Dec. 31, 2011 | |
Employee Stock Option | ' |
Number of Shares | ' |
Beginning of year | 1,916,416 |
Deduct: | ' |
Exercised | -1,913,552 |
Forfeited | -2,864 |
End of year | 0 |
Exercisable, end of year | 0 |
Weighted Average Exercise Price | ' |
Beginning of year | $11.31 |
Exercised | $11.31 |
Forfeited | $11.28 |
End of year | $0 |
Exercisable, end of year | $0 |
Employee_Benefit_Plans_Summary3
Employee Benefit Plans Summary of all Directors' Restricted Stock Activity (Detail) (Non Employee Director Restricted Equity Awards, USD $) | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||||
Non Employee Director Restricted Equity Awards | ' | ' | ' | |||
Number of Shares | ' | ' | ' | |||
Beginning of year | 92,957 | 94,106 | 109,545 | |||
Add (deduct): | ' | ' | ' | |||
Granted | 93,254 | 92,957 | 94,106 | |||
Vested | -92,957 | -94,106 | -109,545 | |||
End of year | 93,254 | 92,957 | 94,106 | |||
Available, end of year | 476,884 | [1] | 570,138 | [1] | 663,095 | [1] |
Weighted Average Grant Date Fair Value | ' | ' | ' | |||
Beginning of year | $21.41 | $21.80 | $20.86 | |||
Granted | $26.19 | $21.41 | $21.80 | |||
Vested | $21.41 | $21.80 | $20.86 | |||
End of year | $26.19 | $21.41 | $21.80 | |||
[1] | Represents shares available under the 2003 Directors Equity Incentive Plan. |
Employee_Benefit_Plans_Summary4
Employee Benefit Plans Summary of all Stock Option Activity for both Current and Former Directors (Detail) (Non Employee Director Stock Option, USD $) | 12 Months Ended | |||
Dec. 31, 2012 | Dec. 31, 2011 | |||
Non Employee Director Stock Option | ' | ' | ||
Number of Shares | ' | ' | ||
Beginning of year | 36,237 | 120,125 | ||
Deduct: | ' | ' | ||
Exercised | -36,237 | -83,888 | ||
End of year | 0 | 36,237 | ||
Exercisable, end of year | 0 | [1] | 36,237 | [1] |
Weighted Average Exercise Price | ' | ' | ||
Beginning of year | $12.51 | $10.34 | ||
Exercised | $12.51 | $9.41 | ||
End of year | $0 | $12.51 | ||
Exercisable, end of year | $0 | [1] | $12.51 | [1] |
[1] | The 1998 Directors’ Stock Option Plan has expired. |
Employee_Benefit_Plans_Assets_
Employee Benefit Plans Assets Held in Deferral Plan Irrevocable Grantor Trust Account (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Millions, unless otherwise specified | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ||
Assets held in Deferral Plan Irrevocable Grantor Trust account | $170.20 | $126.70 | ||
Progressive common shares | ' | ' | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ||
Assets held in Deferral Plan Irrevocable Grantor Trust account | 57.1 | [1] | 53.3 | [1] |
Other Investment Funds | ' | ' | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ||
Assets held in Deferral Plan Irrevocable Grantor Trust account | $113.10 | [2] | $73.40 | [2] |
[1] | Includes 2.5 million and 1.3 million common shares as of December 31, 2013 and 2012, respectively, to be distributed in common shares. | |||
[2] | Amount is included in other assets on the balance sheet. |
Employee_Benefit_Plans_Assets_1
Employee Benefit Plans Assets Held in Deferral Plan Irrevocable Grantor Trust Account (Parenthetical) (Detail) (Progressive common shares) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Progressive common shares | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Common shares held in Deferral Plan Irrevocable Grantor Trust account to be distributed in-kind | 2.5 | 1.3 |
Employee_Benefit_Plans_Additio
Employee Benefit Plans - Additional Information (Detail) (USD $) | 1 Months Ended | 12 Months Ended | ||||||
In Millions, except Share data, unless otherwise specified | Feb. 28, 2009 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |||
Person | Person | Person | ||||||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Employee Stock Ownership Plan Shares held | ' | 26,000,000 | ' | ' | ' | |||
Postemployment benefits liability | ' | 24 | 22 | ' | ' | |||
Maximum Contractual Term Permformance-Based Awards Granted Prior to 2009 | ' | '10 years | ' | ' | ' | |||
Maximum Contractual Term Performance Based Awards Granted In or After 2009 | ' | '5 years | ' | ' | ' | |||
Employee Restricted Equity Awards | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Shares available for future awards | ' | 11,139,779 | [1],[2] | 15,624,677 | [1],[2] | 18,141,922 | [1],[2] | ' |
Aggregate fair value of the restricted equity awards that vested during the period | ' | 91.8 | 57.7 | 31.3 | ' | |||
Dividend equivalent units vested | ' | 272,617 | ' | ' | ' | |||
Deferred liability awards vested | ' | ' | 246,200 | ' | ' | |||
Employee Stock Option | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Total pretax intrinsic value of options exercised | ' | ' | ' | 15.2 | ' | |||
Non Employee Director Restricted Equity Awards | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Shares available for future awards | ' | 476,884 | [3] | 570,138 | [3] | 663,095 | [3] | ' |
Requisite service period, minimum | ' | '6 months 1 day | ' | ' | ' | |||
Vesting period of grants to date | ' | '11 months | ' | ' | ' | |||
Total pretax intrinsic value of options exercised and restricted stock vested | ' | 2.3 | 2.5 | 3.3 | ' | |||
Executive Deferred Compensation Plan | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Common shares reserved for issuance under executive deferred compensation plan | ' | 11,100,000 | ' | ' | ' | |||
2003 Incentive Plan | Employee Restricted Equity Awards | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Shares authorized | ' | 18,700,000 | ' | ' | ' | |||
Shares available for future awards | ' | 1,900,000 | ' | ' | ' | |||
2010 Equity Incentive Plan | Employee Restricted Equity Awards | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Shares authorized | ' | 18,000,000 | ' | ' | ' | |||
Shares available for future awards | ' | 11,100,000 | ' | ' | ' | |||
2003 Directors Equity Incentive Plan | Non Employee Director Restricted Equity Awards | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Shares authorized | ' | 1,400,000 | ' | ' | ' | |||
Shares available for future awards | ' | 500,000 | ' | ' | ' | |||
Other Postretirement Benefit Plans, Defined Benefit | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Number of employees, approximately | ' | 120 | ' | ' | ' | |||
Performance Based Restricted Equity Awards | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Number of employees, approximately | ' | 45 | 45 | 45 | ' | |||
Performance-based awards vesting range | 'either vest or be forfeited in full (i.e., no partial vesting). | ' | ' | ' | ' | |||
Performance-based awards granted vesting target percentage | ' | ' | ' | ' | 100.00% | |||
Performance Based Restricted Equity Awards | Upper Limit | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Performance-based awards granted vesting percentage of the award amount | ' | 250.00% | ' | ' | 200.00% | |||
Performance Based Restricted Equity Awards | Lower Limit | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Performance-based awards granted vesting percentage of the award amount | ' | 0.00% | ' | ' | 0.00% | |||
Defined Contribution Pension Plan 401k | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Matching contributions | ' | 69.9 | 66.5 | 64.1 | ' | |||
Defined Contribution Pension Plan 401k | Upper Limit | ' | ' | ' | ' | ' | |||
Employee Benefits Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Matching contribution to defined contribution pension plan | ' | 6.00% | ' | ' | ' | |||
[1] | Represents shares available under the 2010 Incentive Plan; the 2003 Incentive Plan expired on January 31, 2013, and the remaining 1,898,699 shares thereunder are no longer available for future issuance, however, dividend equivalents will be issued on outstanding awards up to the remaining authorization amount. | |||||||
[2] | Includes both restricted stock units and restricted stock. Upon vesting, all units will be converted on a one-for-one basis into Progressive common shares funded from existing treasury shares. All performance-based awards are included at their target amounts. | |||||||
[3] | Represents shares available under the 2003 Directors Equity Incentive Plan. |
Segment_Information_Operating_
Segment Information Operating Results (Details) (USD $) | 12 Months Ended | |||||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Revenues | $18,170.90 | $17,083.90 | $15,774.60 | |||
Pretax Profit (Loss) | 1,720 | 1,317.70 | 1,487 | |||
Underwriting Operations | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Revenues | 17,103.40 | 16,018 | 14,902.80 | |||
Pretax Profit (Loss) | 1,120.10 | 708.9 | 1,047.30 | |||
Underwriting Operations | Personal Lines | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Revenues | 15,341.60 | [1] | 14,368.10 | [1] | 13,431.10 | [1] |
Pretax Profit (Loss) | 1,016.80 | [1] | 628.4 | [1] | 919.3 | [1] |
Underwriting Operations | Personal Lines | Agency Channel | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Revenues | 8,601.50 | 8,103.90 | 7,627.40 | |||
Pretax Profit (Loss) | 542.9 | 338.9 | 564.9 | |||
Underwriting Operations | Personal Lines | Direct Channel | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Revenues | 6,740.10 | 6,264.20 | 5,803.70 | |||
Pretax Profit (Loss) | 473.9 | 289.5 | 354.4 | |||
Underwriting Operations | Commercial Lines | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Revenues | 1,761.60 | 1,649 | 1,467.10 | |||
Pretax Profit (Loss) | 114.1 | 86.3 | 133.5 | |||
Underwriting Operations | Other Indemnity | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Revenues | 0.2 | 0.9 | 4.6 | |||
Pretax Profit (Loss) | -10.8 | -5.8 | -5.5 | |||
Fees And Other Revenues | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Revenues | 291.8 | [2] | 281.8 | [2] | 266.5 | [2] |
Service Businesses | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Revenues | 39.6 | 36.1 | 22.8 | |||
Pretax Profit (Loss) | 0.8 | 0 | 3.4 | |||
Investments | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Revenues | 740.4 | [3] | 749.8 | [3] | 582.6 | [3] |
Pretax Profit (Loss) | 721.6 | [3] | 734.4 | [3] | 569.1 | [3] |
Gains (losses) on extinguishment of debt | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Revenues | -4.3 | -1.8 | -0.1 | |||
Pretax Profit (Loss) | -4.3 | -1.8 | -0.1 | |||
Interest Expense | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | |||
Pretax Profit (Loss) | ($118.20) | ($123.80) | ($132.70) | |||
[1] | Personal auto insurance accounted for 91% of the total Personal Lines segment net premiums earned in 2013, 2012, and 2011; insurance for our special lines products (e.g., motorcycles, ATVs, RVs, mobile homes, watercraft, and snowmobiles) accounted for the balance of the Personal Lines net premiums earned. | |||||
[2] | Pretax profit (loss) for fees and other revenues are allocated to operating segments. | |||||
[3] | Revenues represent recurring investment income and total net realized gains (losses) on securities; pretax profit is net of investment expenses. |
Segment_Information_Operating_1
Segment Information Operating Results (Parenthetical) (Details) (Personal Lines, Personal Auto, Underwriting Operations) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Personal Lines | Personal Auto | Underwriting Operations | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Personal auto insurance percentage of the total personal lines segment net premiums earned | 91.00% | 91.00% | 91.00% |
Segment_Information_Underwriti
Segment Information Underwriting Margins and Combined Ratios for our Underwriting Operations (Details) (Underwriting Operations) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Segment Reporting Information [Line Items] | ' | ' | ' |
Underwriting Margin | 6.50% | 4.40% | 7.00% |
Combined Ratio | 93.50% | 95.60% | 93.00% |
Personal Lines | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Underwriting Margin | 6.60% | 4.40% | 6.80% |
Combined Ratio | 93.40% | 95.60% | 93.20% |
Personal Lines | Agency Channel | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Underwriting Margin | 6.30% | 4.20% | 7.40% |
Combined Ratio | 93.70% | 95.80% | 92.60% |
Personal Lines | Direct Channel | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Underwriting Margin | 7.00% | 4.60% | 6.10% |
Combined Ratio | 93.00% | 95.40% | 93.90% |
Commercial Lines | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Underwriting Margin | 6.50% | 5.20% | 9.10% |
Combined Ratio | 93.50% | 94.80% | 90.90% |
Segment_Information_Additional
Segment Information - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Segment Reporting Information [Line Items] | ' | ' | ' |
Net premiums earned | $17,103.40 | $16,018 | $14,902.80 |
Depreciation | 101.3 | 94.4 | 88.5 |
Underwriting Operations | Personal Lines | Agency Channel | Lower Limit | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Independent insurance agencies and brokerages | 35,000 | ' | ' |
Australia | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Net premiums earned | $13 | $7.10 | $3.50 |
Other_Comprehensive_Income_Com
Other Comprehensive Income Components of Other Comprehensive Income (Loss) Including Reclassification Adjustments by Income Statement (Detail) (USD $) | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||||
Accumulated Other Comprehensive Income (Loss), before Tax [Roll Forward] | ' | ' | ' | |||
Pre tax total accumulated other comprehensive income, beginning balance | $1,340,000,000 | $1,065,400,000 | $1,205,600,000 | |||
Investment securities, pre tax | 368,200,000 | 488,000,000 | 75,400,000 | |||
Net non-credit related OTTI losses, adjusted for valuation changes, pre tax | 400,000 | 7,900,000 | -5,500,000 | |||
Forecasted transactions, pre tax | 0 | 0 | -5,100,000 | |||
Foreign currently translation adjustement, pre tax | -2,500,000 | 600,000 | 200,000 | |||
Total other comprehensive income (loss) before reclassifications, pre tax | 366,100,000 | 496,500,000 | 65,000,000 | |||
Total reclassification adjustment for amounts realized in net income, pre tax | 242,000,000 | 221,900,000 | 205,200,000 | |||
Total other comprehensive income (loss), pre tax | 124,100,000 | 274,600,000 | -140,200,000 | |||
Pre tax total accumulated other comprehensive income, ending balance | 1,464,100,000 | 1,340,000,000 | 1,065,400,000 | |||
Accumulated Other Comprehensive Income (Loss), Tax [Roll Forward] | ' | ' | ' | |||
Accumulated other comprehensive income loss tax (provision) benefit, beginning balance | -469,000,000 | -372,900,000 | -421,900,000 | |||
Investment securities, Total tax (provision) benefit | -128,900,000 | -170,800,000 | -26,400,000 | |||
Net non-credit related OTTI losses, adjusted for valuation changes Total tax (provision) benefit | -100,000 | -2,800,000 | 1,900,000 | |||
Forecasted transactions, Total tax (provision) benefit | 0 | 0 | 1,800,000 | |||
Foreign currency traslation adjustment, Total tax (provision) benefit | 900,000 | -200,000 | -100,000 | |||
Total other comprehensive Income (loss) before reclassifications, Total tax (provision) benefit | -128,100,000 | -173,800,000 | -22,800,000 | |||
Total reclassification adjustment for amounts realized in net income, Total tax (provision) benefit | -84,700,000 | -77,700,000 | -71,800,000 | |||
Total other comprehensive income (loss), Total tax (provision) benefit | -43,400,000 | -96,100,000 | 49,000,000 | |||
Accumulated other comprehensive income loss tax (provision) benefit, ending balance | -512,400,000 | -469,000,000 | -372,900,000 | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | |||
After tax total other accumulated comprehensive income, beginning balance | 871,000,000 | 692,500,000 | 783,700,000 | |||
Investment securities, after tax | 239,300,000 | 317,200,000 | 49,000,000 | |||
Net non-credit related OTTI losses, adjusted for valuation changes, after tax | 300,000 | 5,100,000 | -3,600,000 | |||
Forecasted transactions, after tax | 0 | 0 | -3,300,000 | |||
Foreign currency translation adjustment, after tax | -1,600,000 | 400,000 | 100,000 | |||
Total other comprehensive income (loss), before reclassifications, after tax | 238,000,000 | 322,700,000 | 42,200,000 | |||
Total reclassification adjustment for amounts realized in net income, after tax | 157,300,000 | 144,200,000 | 133,400,000 | |||
Other comprehensive income (loss) | 80,700,000 | 178,500,000 | -91,200,000 | |||
After tax total other accumulated comprehensive income, ending balance | 951,700,000 | 871,000,000 | 692,500,000 | |||
Net impairment losses recognized in earnings | -6,100,000 | -8,000,000 | -5,500,000 | |||
Net realized gains (losses) on securities | 324,500,000 | 314,800,000 | 108,100,000 | |||
Interest expense | 118,200,000 | 123,800,000 | 132,700,000 | |||
Net unrealized gains (losses) on securities | ' | ' | ' | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | |||
After tax total other accumulated comprehensive income, beginning balance | 862,700,000 | 682,800,000 | 767,300,000 | |||
Investment securities, after tax | 239,300,000 | 317,200,000 | 49,000,000 | |||
Net non-credit related OTTI losses, adjusted for valuation changes, after tax | 300,000 | 5,100,000 | -3,600,000 | |||
Forecasted transactions, after tax | 0 | 0 | 0 | |||
Foreign currency translation adjustment, after tax | 0 | 0 | 0 | |||
Total other comprehensive income (loss), before reclassifications, after tax | 239,600,000 | 322,300,000 | 45,400,000 | |||
Total reclassification adjustment for amounts realized in net income, after tax | 155,300,000 | 142,400,000 | 129,900,000 | |||
Other comprehensive income (loss) | 84,300,000 | 179,900,000 | -84,500,000 | |||
After tax total other accumulated comprehensive income, ending balance | 947,000,000 | 862,700,000 | 682,800,000 | |||
Net unrealized gains on forecasted transactions | ' | ' | ' | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | |||
After tax total other accumulated comprehensive income, beginning balance | 6,100,000 | [1],[2] | 7,900,000 | [1] | 14,700,000 | [1] |
Investment securities, after tax | 0 | [1],[2] | 0 | [1] | 0 | [1] |
Net non-credit related OTTI losses, adjusted for valuation changes, after tax | 0 | [1],[2] | 0 | [1] | 0 | [1] |
Forecasted transactions, after tax | 0 | [1],[2] | 0 | [1] | -3,300,000 | [1] |
Foreign currency translation adjustment, after tax | 0 | [1],[2] | 0 | [1] | 0 | [1] |
Total other comprehensive income (loss), before reclassifications, after tax | 0 | [1],[2] | 0 | [1] | -3,300,000 | [1] |
Total reclassification adjustment for amounts realized in net income, after tax | 2,000,000 | [1],[2] | 1,800,000 | [1] | 3,500,000 | [1] |
Other comprehensive income (loss) | -2,000,000 | [1],[2] | -1,800,000 | [1] | -6,800,000 | [1] |
After tax total other accumulated comprehensive income, ending balance | 4,100,000 | [1],[2] | 6,100,000 | [1],[2] | 7,900,000 | [1] |
Foreign Currency Translation Adjustments | ' | ' | ' | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | |||
After tax total other accumulated comprehensive income, beginning balance | 2,200,000 | 1,800,000 | 1,700,000 | |||
Investment securities, after tax | 0 | 0 | 0 | |||
Net non-credit related OTTI losses, adjusted for valuation changes, after tax | 0 | 0 | 0 | |||
Forecasted transactions, after tax | 0 | 0 | 0 | |||
Foreign currency translation adjustment, after tax | -1,600,000 | 400,000 | 100,000 | |||
Total other comprehensive income (loss), before reclassifications, after tax | -1,600,000 | 400,000 | 100,000 | |||
Total reclassification adjustment for amounts realized in net income, after tax | 0 | 0 | 0 | |||
Other comprehensive income (loss) | -1,600,000 | 400,000 | 100,000 | |||
After tax total other accumulated comprehensive income, ending balance | 600,000 | 2,200,000 | 1,800,000 | |||
Reclassification out of Accumulated Other Comprehensive Income | Accumulated other comprehesnive income pretax | ' | ' | ' | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | |||
Net impairment losses recognized in earnings | -5,700,000 | -400,000 | -600,000 | |||
Net realized gains (losses) on securities | 245,500,000 | [3] | 220,100,000 | [3] | 200,800,000 | [3] |
Interest expense | 2,200,000 | [2] | 2,200,000 | 5,000,000 | ||
Reclassification out of Accumulated Other Comprehensive Income | Accumulated other comprehensive income tax | ' | ' | ' | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | |||
Net impairment losses recognized in earnings | 2,000,000 | 100,000 | 200,000 | |||
Net realized gains (losses) on securities | -86,000,000 | [3] | -77,000,000 | [3] | -70,300,000 | [3] |
Interest expense | -700,000 | [2] | -800,000 | -1,700,000 | ||
Reclassification out of Accumulated Other Comprehensive Income | Accumulated other comprehensive income after tax | ' | ' | ' | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | |||
Net impairment losses recognized in earnings | -3,700,000 | -300,000 | -400,000 | |||
Net realized gains (losses) on securities | 159,500,000 | [3] | 143,100,000 | [3] | 130,500,000 | [3] |
Interest expense | 1,500,000 | [2] | 1,400,000 | 3,300,000 | ||
Reclassification out of Accumulated Other Comprehensive Income | Net unrealized gains (losses) on securities | ' | ' | ' | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | |||
Net impairment losses recognized in earnings | -3,700,000 | -300,000 | -400,000 | |||
Net realized gains (losses) on securities | 159,000,000 | [3] | 142,700,000 | [3] | 130,300,000 | [3] |
Interest expense | 0 | [2] | 0 | 0 | ||
Reclassification out of Accumulated Other Comprehensive Income | Net unrealized gains on forecasted transactions | ' | ' | ' | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | |||
Net impairment losses recognized in earnings | 0 | [1],[2] | 0 | [1] | 0 | [1] |
Net realized gains (losses) on securities | 500,000 | [1],[2],[3] | 400,000 | [1],[3] | 200,000 | [1],[3] |
Interest expense | 1,500,000 | [1],[2] | 1,400,000 | [1] | 3,300,000 | [1] |
Reclassification out of Accumulated Other Comprehensive Income | Foreign Currency Translation Adjustments | ' | ' | ' | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | |||
Net impairment losses recognized in earnings | 0 | 0 | 0 | |||
Net realized gains (losses) on securities | 0 | [3] | 0 | [3] | 0 | [3] |
Interest expense | $0 | [2] | $0 | $0 | ||
[1] | Entered into for the purpose of managing interest rate risk associated with our debt issuances. | |||||
[2] | We expect to reclassify $2.1 million (pretax) into income during the next 12 months, related to net unrealized gains on forecasted transactions. | |||||
[3] | During 2013, 2012, and 2011, we reclassified $0.8 million, $0.6 million, and $0.3 million, respectively, on a pretax basis, from accumulated other comprehensive income on the balance sheet to net realized gains on securities on the comprehensive income statement, reflecting the portion of the unrealized gain on forecasted transactions that was related to the portion of the 6.70% Debentures repurchased during the periods (see Note 4 – Debt for further discussion). |
Other_Comprehensive_Income_Com1
Other Comprehensive Income Components of Other Comprehensive Income (Loss) Including Reclassification Adjustments by Income Statement (Parenthetical) (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Pre Tax | ' | ' | ' |
Components Of Other Comprehensive Income Loss [Line Items] | ' | ' | ' |
Net unrealized gains on forecasted transactions, expected to reclassify into income within the next 12 months | $2.10 | ' | ' |
6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | ' | ' | ' |
Components Of Other Comprehensive Income Loss [Line Items] | ' | ' | ' |
Cash flow hedge gain reclassification from accumulated other comprehensive income to net realized gains/losses on securities | 0.8 | 0.6 | 0.3 |
6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 | Net unrealized gains on forecasted transactions | ' | ' | ' |
Components Of Other Comprehensive Income Loss [Line Items] | ' | ' | ' |
Cash flow hedge gain reclassification from accumulated other comprehensive income to net realized gains/losses on securities | $0.80 | $0.60 | $0.30 |
Commitments_and_Contingencies_1
Commitments and Contingencies Minimum Commitments under Noncancelable Operating Lease Agreements (Detail) (USD $) | Dec. 31, 2013 |
In Millions, unless otherwise specified | |
Commitments and Contingencies Disclosure [Line Items] | ' |
2014 | $46 |
2015 | 38.2 |
2016 | 27.6 |
2017 | 16.1 |
2018 | 9.5 |
Thereafter | 7.2 |
Total | $144.60 |
Commitments_and_Contingencies_2
Commitments and Contingencies Expenses Incurred for Leases (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Commitments and Contingencies Disclosure [Line Items] | ' | ' | ' |
Expense | $64.60 | $71.90 | $80.80 |
Commitments_and_Contingencies_3
Commitments and Contingencies - Additional Information (Detail) (USD $) | Dec. 31, 2013 |
In Millions, unless otherwise specified | |
Commitments and Contingencies Disclosure [Line Items] | ' |
Minimum commitment under noncancelable purchase obligations | $215.30 |
DividendsAdditional_Informatio
Dividends-Additional Information (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 28, 2013 | Feb. 29, 2012 | Nov. 30, 2012 | Feb. 26, 2014 | Feb. 26, 2014 |
In Millions, except Per Share data, unless otherwise specified | Annual variable dividend | Annual variable dividend | Special dividend | Subsequent Event | Subsequent Event | |||
Annual variable dividend | Special dividend | |||||||
Dividends Payable [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Target percentage used to determine annual variable dividend | 33.33% | ' | ' | ' | ' | ' | ' | ' |
Gainshare factor used to determine annual variable dividend range, minimum | 0 | ' | ' | ' | ' | ' | ' | ' |
Gainshare factor used to determine annual variable dividend range, maximum | 2 | ' | ' | ' | ' | ' | ' | ' |
Gainshare factor used to determine annual variable dividend | 1.21 | 1.12 | 1.1 | ' | ' | ' | ' | ' |
Dividend paid per share (USD per share) | ' | ' | ' | $0.28 | $0.41 | $1 | $0.49 | $1 |
Dividends paid to shareholders | ' | ' | ' | $172 | $249.40 | $604.70 | $293.90 | $596.30 |